Proposed Rule2021-18567
Small Claims Procedures for Library and Archives Opt-Outs and Class Actions
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
September 2, 2021
Issuing agencies
Library of CongressCopyright Office, Library of Congress
Abstract
The U.S. Copyright Office is issuing a notice of proposed rulemaking regarding the procedures for libraries and archives to opt out of proceedings before the Copyright Claims Board ("CCB") and the procedures for a party before the CCB with respect to a class action proceeding, under the Copyright Alternative in Small-Claims Enforcement Act of 2020. The Office invites public comments on this proposed rule.
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<title>Federal Register, Volume 86 Issue 168 (Thursday, September 2, 2021)</title>
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[Federal Register Volume 86, Number 168 (Thursday, September 2, 2021)]
[Proposed Rules]
[Pages 49273-49278]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2021-18567]
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LIBRARY OF CONGRESS
Copyright Office
37 CFR Part 223
[Docket No. 2021-4]
Small Claims Procedures for Library and Archives Opt-Outs and
Class Actions
AGENCY: U.S. Copyright Office, Library of Congress.
ACTION: Notice of proposed rulemaking.
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SUMMARY: The U.S. Copyright Office is issuing a notice of proposed
rulemaking regarding the procedures for libraries and archives to opt
out of proceedings before the Copyright Claims Board (``CCB'') and the
procedures for a party before the CCB with respect to a class action
proceeding, under the Copyright Alternative in Small-Claims Enforcement
Act of 2020. The Office invites public comments on this proposed rule.
DATES: Comments on the proposed rule must be made in writing and
received by the U.S. Copyright Office no later than 11:59 p.m. EDT on
October 4, 2021.
ADDRESSES: For reasons of government efficiency, the Copyright Office
is using the <a href="http://regulations.gov">regulations.gov</a> system for the submission and posting of
public comments in this proceeding. All comments are therefore to be
submitted electronically through <a href="http://regulations.gov">regulations.gov</a>. Specific instructions
for submitting comments are available on the Copyright Office website
at <a href="https://www.copyright.gov/rulemaking/case-act-implementation/library-opt-out">https://www.copyright.gov/rulemaking/case-act-implementation/library-opt-out</a>. If electronic submission of comments is not feasible
due to lack of access to a computer and/or the internet, please contact
the Office using the contact information below for special
instructions.
FOR FURTHER INFORMATION CONTACT: Kevin. R. Amer, Acting General Counsel
and Associate Register of Copyrights, by email at <a href="/cdn-cgi/l/email-protection#a7ccc6cac2d5e7c4c8d7ded5cec0cfd389c0c8d1"><span class="__cf_email__" data-cfemail="a4cfc5c9c1d6e4c7cbd4ddd6cdc3ccd08ac3cbd2">[email protected]</span></a>,
or John R. Riley, Assistant General Counsel, by email at
<a href="/cdn-cgi/l/email-protection#2a405843466a49455a5358434d425e044d455c"><span class="__cf_email__" data-cfemail="09637b6065496a6679707b606e617d276e667f">[email protected]</span></a>. Each can be contacted by telephone at (202) 707-
8350.
SUPPLEMENTARY INFORMATION:
I. Background
The Copyright Alternative in Small-Claims Enforcement (``CASE'')
Act of 2020 \1\ directs the Copyright Office to establish the Copyright
Claims Board (``CCB'' or ``Board''), a voluntary tribunal within the
Office comprised of three Copyright Claims Officers who have the
authority to render determinations on certain copyright disputes with a
low economic value. This notice of proposed rulemaking is being issued
subsequent to a notification of inquiry (``NOI'') published in the
Federal Register on March 26, 2021, which describes in detail the
legislative background and regulatory scope of the present rulemaking
proceeding.\2\ The Office assumes the reader's familiarity with that
document.
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\1\ Public Law 116-260, sec. 212, 134 Stat. 1182, 2176 (2020).
\2\ 86 FR 16156, 16161 (Mar. 26, 2021). Comments received in
response to the March 26, 2021 NOI are available at <a href="https://www.regulations.gov/document/COLC-2021-0001-0001/comment">https://www.regulations.gov/document/COLC-2021-0001-0001/comment</a>. References
to these comments are by party name (abbreviated where appropriate),
followed by ``Initial NOI Comments'' or ``Reply NOI Comments,'' as
appropriate.
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A. Library and Archives Opt Out
The CASE Act directs the Register of Copyrights to ``establish
regulations allowing for a library or archives that does not wish to
participate in proceedings before the Copyright Claims Board to
preemptively opt out of such proceedings.'' \3\ The Office must also
``compile and maintain a publicly available list of the libraries and
archives that have successfully opted out of proceedings.'' \4\ In
promulgating these regulations, the Register cannot ``charge a library
or archives a fee to preemptively opt out of proceedings'' or ``require
a library or archives to renew a decision to preemptively opt out of
proceedings.'' \5\
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\3\ 17 U.S.C. 1506(aa)(1).
\4\ Id. at 1506(aa)(2)(B).
\5\ Id. at 1506(aa)(3)(A).
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For the purposes of this provision, the statute defines ``library''
and ``archives'' as ``any library or archives, respectively, that
qualifies for the limitations on exclusive rights under section 108 [of
title 17].'' \6\ Section 108 provides exemptions to libraries and
archives from liability for infringement for specified uses of
copyrighted works.\7\ For an institution to qualify for those
exemptions, ``the collections of the library or archives [must be] . .
. open to the public, or . . . available not only to researchers
affiliated with the library or archives or with the institution of
which it is a part, but also to other persons doing research in a
specialized
[[Page 49274]]
field.'' \8\ The Copyright Act of 1976's House Report provides further
guidance as to entities intended to be covered by section 108:
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\6\ Id. at 1506(aa)(3)(B). The CASE Act's legislative history
does not discuss the library and archives opt-out provision. See
generally S. Rep. No. 116-105 (2019); H.R. Rep. No. 116-252 (2019).
Note, the CASE Act's legislative history cited is for S. 1273, 116th
Cong. (2019) and H.R. 2426, 116th Cong. (2019), the CASE Act of
2019, bills largely identical to the CASE Act of 2020, with the
notable exception that these earlier bills did not contain the
libraries and archives opt-out provision.
\7\ 17 U.S.C. 108.
\8\ Id. at 108(a).
Under [section 108], a purely commercial enterprise could not
establish a collection of copyrighted works, call itself a library
or archive, and engage in for-profit reproduction and distribution
of photocopies. Similarly, it would not be possible for a non-profit
institution, by means of contractual arrangements with a commercial
copying enterprise, to authorize the enterprise to carry out copying
and distribution functions that would be exempt if conducted by the
non-profit institution itself.\9\
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\9\ H.R. Rep. No. 94-1476 at 74.
The House Report also notes that there may be factual questions as
to whether libraries or archives ``within industrial, profitmaking, or
proprietary institutions'' would qualify for the section 108
exemptions.\10\
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\10\ Id.
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In the NOI, the Office requested input on issues related to this
opt-out provision, including whether the Office should require proof or
a certification that a library or archives qualifies for the opt-out
provision; which entities, principals, or agents should be allowed to
opt out on behalf of a library or archives; how the opt-out provision
would apply to library or archives employees; and various transparency
and functionality considerations related to publication of the opt-out
list.\11\
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\11\ 86 FR 16156, 16161 (Mar. 26, 2021).
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1. Proof or Certification Requirement
The NOI asked ``whether a library or archive should be required to
prove or certify its qualification for the limitations on exclusive
rights under 17 U.S.C. 108, and thus for the blanket opt-out
provisions, and how to address circumstances where a library or
archives ceases qualifying.'' \12\ In comments submitted in response,
parties representing libraries and archives generally opposed any
requirement that these entities be required to ``prove'' that they
qualify for the opt-out provision, although some supported a provision
allowing such an entity to self-certify that it qualifies.\13\
University Information Policy Officers and the University of Michigan
Library stated that libraries and archives should not be required to
certify their eligibility to submit a preemptive blanket opt-out
notice.\14\ AALL suggested that a self-certification approach ``would
meet the intent of Congress, which created the preemptive opt out for
libraries and archives to provide an efficient and streamlined system
for these organizations and to help them avoid the burdensome
administrative requirements of repeated opt outs.'' \15\ LCA initially
stated a library should only have to ``assert'' that it qualifies for
the preemptive opt-out,\16\ but subsequently suggested that self-
certification would be preferred to a ``legal conclusion by a
government agency that could influence a court's assessment concerning
a library's qualification for section 108.'' \17\
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\12\ Id.
\13\ Am. Ass'n of L. Libraries (``AALL'') NOI Initial Comments
at 1-2; Univ. of Mich. Library NOI Initial Comments at 4-5.
\14\ Univ. of Mich. Library NOI Initial Comments at 4-5
(``Libraries and archives that would like to file a blanket opt-out
notice should be able to do so without needing to certify or prove
their eligibility for uses authorized by [section] 108.''); Univ.
Infor. Pol'y Officers NOI Reply Comments at 1 (``libraries and
archives should not be required to certify their eligibility in
order to submit a preemptive blanket opt-out''); see also Library
Copyright All. (``LCA'') NOI Initial Comments at 1 (``it should be
sufficient for the library merely to assert that it meets the
statutory definition''). But see LCA NOI Reply Comments at 2
(contemplating a preemptive opt out by ``certification'').
\15\ AALL NOI Initial Comments at 1-2; see also Anthony Davis
Jr. & Katherine Luce NOI Initial Comments at 2 (``If there is any
approval or certification process, it should not be onerous.'').
\16\ LCA NOI Initial Comments at 1.
\17\ LCA NOI Reply Comments at 2.
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Others suggested that an entity that preemptively opts out of CCB
proceedings should be required to submit a formal affidavit or
declaration ``certifying its limitations on exclusive rights under 17
U.S.C 108,'' \18\ potentially under penalty of perjury.\19\ The
Copyright Alliance et al. argued that Congress granted libraries and
archives ``a unique and narrow exception'' to preemptively opt out of
CCB proceedings, but in doing so ``expressly limited the ability to
blanket opt out to [libraries or archives] that qualify for the
limitations on exclusive rights under section 108.'' \20\ They voiced
concern that ``[t]o allow entities to `self-certify' would be to open
the blanket opt out to any entity claiming to be a `library' or
`archive' regardless of whether the entity rightfully qualifies under
the law.'' \21\
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\18\ Ben Vient NOI Initial Comments at 3 (suggesting that ``[t]o
the extent that a Library or Archive wishes to keep its opt-out
current with the CCB, it is the responsibility of the Library or
Archive to have an Affidavit or Declaration with its current
Director on file with the CCB'').
\19\ Am. Intell. Prop. L. Ass'n (``AIPLA'') NOI Initial Comments
at 4; Copyright Alliance, Am. Photographic Artists, Am. Soc'y for
Collective Rights Licensing, Am. Soc'y of Media Photographers, The
Authors Guild, CreativeFuture, Digital Media Licensing Ass'n,
Graphic Artists Guild, Indep. Book Pubs. Ass'n, Music Creators N.
Am., Nat'l Music Council of the United States, Nat'l Press
Photographers Ass'n, N. Am. Nature Photography Ass'n, Prof.
Photographers of Am., Recording Academy, Screen Actors Guild-Am.
Fed. of Television and Radio Artists, Soc'y of Composers &
Lyricists, Songwriters Guild of Am. & Songwriters of N. Am.
(``Copyright Alliance et al.'') NOI Initial Comments at 20; Science
Fiction and Fantasy Writers of Am. NOI Reply Comments at 2 (agreeing
that ``a library or archive should make its declaration under
penalty of perjury''); see also Ass'n of Medical Illustrators
(``AMI'') NOI Initial Comments at 2 (``AMI strongly believes that
[library and archives] proof and certification should be a
requirement in implementing regulations'' and ``that the pre-emptive
opt-out is not available to companies that are not eligible for
Internal Revenue Code of 501[(c)(3)] treatment.'').
\20\ Copyright Alliance et al. NOI Reply Comments at 12-13.
\21\ Id.
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AIPLA, AMI, and Copyright Alliance et al. proposed creating a
Copyright Office or CCB procedure, separate from a CCB infringement
proceeding, to review the qualifying status of a library or archives
for the preemptive opt-out.\22\ AIPLA recommended that ``anyone,
including members of the public not bringing a CCB claim, should be
permitted to challenge whether a Library or Archive qualifies [for the
preemptive opt-out].'' \23\ Both AIPLA and the Copyright Alliance et
al. proposed that the Office could charge a fee for its review, with
AIPLA suggesting that the fee would be ``paid by the challenger if the
CCB finds the Library or Archive still qualifies, and by the Library or
Archive if it is found not to comply.'' \24\ Finally, the Copyright
Alliance et al. proposed an additional mechanism to address any
circumstance where a federal court ``determines that [an] entity does
not qualify for the section 108 exceptions.'' \25\ In such a case, the
court or the entity would be directed to notify the Copyright Office of
that determination, so that it can ``reconsider the blanket opt-out
after giving the [library or archive] an opportunity to defend its
status.'' \26\
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\22\ AIPLA NOI Initial Comments at 4 (``If the CCB determines
that a Library or Archive does not qualify, the Library or Archive
should be permitted to appeal the decision for a fee.''); Copyright
Alliance et al. NOI Initial Comments at 20 (same); see AMI NOI
Initial Comments at 2 (``Library/Archive opt-outs should be open to
public comment and granted for 2-year terms then must reapply (using
the 1201 exemption to prohibition on of circumvention process as a
potential model).''); Univ. of Mich. Library NOI Initial Comments at
4-5 (``If a challenge is later brought concerning the library or
archive's status, the library or archive should be required to
attest that they meet the requirements of [section] 108(a)(2).'').
\23\ AIPLA NOI Initial Comments at 4.
\24\ Id.; Copyright Alliance et al. NOI Initial Comments at 20
(``If it is determined that a [library or archives] does not
qualify, the [library or archives] should be permitted to request
that the Board reconsider the decision for a fee (the statute only
precludes a fee to apply not to request reconsideration when the
application is denied).'').
\25\ Copyright Alliance et al. NOI Initial Comments at 20; see
Copyright Alliance et al. NOI Reply Comments at 14-15 (same); AIPLA
NOI Initial Comments at 4 (same).
\26\ Copyright Alliance et al. NOI Initial Comments at 20; see
Copyright Alliance et al. NOI Reply Comments at 14-15 (same); AIPLA
NOI Initial Comments at 4 (same).
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[[Page 49275]]
LCA did not support such a proceeding and suggested that, if a
claimant wishes to bring a claim against a library or archives that it
believes is ineligible for the preemptive opt out, ``it can file a
claim against the library [or archives] with the CCB, indicating that
the library [or archives] does not meet the [statutory] requirements.''
\27\ At that point, the CCB would review the claim to determine ``[i]f
the claimant has pled facts sufficient to indicate that the library no
longer is eligible for the preemptive opt-out,'' and then the library
or archives would be served with a notice and given the opportunity to
either ``demonstrate that it still meets the requirements of section
108(a)(2), and thus that its preemptive opt-out is still valid,'' or
``opt out of that specific proceeding before the CCB.'' \28\
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\27\ LCA NOI Reply Comments at 2.
\28\ Id.
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While taking no position on any process for a library or archives
to ``claim status . . . for purposes of a blanket opt-out,'' the Motion
Picture Association (``MPA''), Recording Industry Association of
America (``RIAA''), and Software and Information Industry Association
(``SIIA'') asked that the Office make clear that ``an entity's status
as a library or archive for the purposes of opting out under CCB does
not constitute a determination of that entity's status, and may not be
cited as such, in any other context, including in any federal court
litigation in which that entity is a party.'' \29\
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\29\ MPA, RIAA & SIIA NOI Reply Comments at 10. LCA agreed that
any status determination by the CCB should not be treated as
conclusive in other contexts. LCA NOI Reply Comments at 1-2.
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The Office appreciates parties' comments on this issue and proposes
that any library or archives that wishes to take advantage of the
statutory preemptive opt-out option must submit a self-certification
that it ``qualifies for the limitations on exclusive rights under
section 108.'' \30\ In doing so, the Office is seeking to balance the
statutory goals of ensuring that only libraries and archives are
eligible for a preemptive opt-out, but also that any such entities are
not overly burdened in effecting that election. The proposed rule also
requires that any library or archives that has been found by a federal
court not to qualify for the section 108 exemptions report this
information to the CCB.
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\30\ 17 U.S.C. 1506(aa)(4); see also Copyright Alliance et al.
NOI Reply Comments at 13 n.7 (opposing ``comments suggesting that
the CCB adopt a definition of `libraries and archives' other than
the definition articulated in the statute''). But see Authors
Alliance NOI Initial Comments at 5-6 (``[W]e support a broad
definition of `libraries and archives' which encompasses public
libraries, academic libraries, and other institutions serving the
essential functions of preservation and sharing of knowledge and
culture.'').
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The Office will accept the facts stated in the opt-out submission
unless they are implausible or conflict with sources of information
that are known to the Office or the general public.\31\ If the Office
believes, based on such information, that the entity does not qualify,
it will communicate to the submitter that it does not intend to add the
entity to the preemptive opt-out list, or that it intends to remove the
entity from the list. The Office will then allow the submitter to
provide evidence supporting the entity's eligibility for the exemption.
If, after reviewing the submitter's response, the Office determines
that the entity does not qualify, the entity will not be added to, or
will be removed from, the opt-out list. If the Office determines that
the entity does qualify, it will be added to, or remain on, the opt-out
list. Either determination will constitute final agency action under
the Administrative Procedure Act.\32\
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\31\ See U.S. Copyright Office, Compendium of U.S. Copyright
Office Practices sec. 309.2 (3d ed. 2021) (noting the Office's
similar approach regarding registration materials).
\32\ 5 U.S.C. 704 (``[F]inal agency action for which there is no
other adequate remedy in a court [is] subject to judicial
review.'').
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With respect to the requests to allow third-party challenges to an
institution's eligibility for the preemptive opt-out, the Office does
not believe it is necessary to establish a procedure for such
objections that is separate from the CCB's adjudication of individual
cases. Such a process would seem an inefficient use of CCB resources,
as it could require the Board to resolve disputes over an institution's
status before any claim involving that entity has been made. As LCA
notes, a party seeking to bring a claim against a library or archives
that it believes is improperly on the opt-out list may file the claim
with the CCB and include the basis for that conclusion in its statement
of material facts. If, during its review of the claim for compliance,
the CCB determines that the claimant has alleged facts sufficient to
support the conclusion that the entity is ineligible, and the claim is
otherwise compliant, the claimant will be instructed to proceed with
service on the respondent. The respondent may then include in its
response any information to demonstrate that it is in fact eligible, or
may simply opt out of that specific proceeding. This process is
reflected in the proposed rule.
2. Persons Allowed To Opt Out on Behalf of a Library or Archives
The NOI noted the ``prevalence of libraries and archives being
located within larger entities, including but not limited to colleges
and universities or municipalities,'' and asked for comments
``addressing which entities, principals, or agents may opt out on
behalf of a library or archive, as well as any associated
certifications.'' \33\ In response, LCA suggested that Office
regulations ``should allow the preemptive opt-out to be exercised by
any person with the authority to take legally binding actions on behalf
of the library in connection to litigation.'' \34\ In its view,
``[b]ecause some institutions have many different libraries, an
official with the appropriate authority should be able in a single
process to exercise a preemptive opt-out with respect to all the
eligible libraries within the institution.'' \35\ Other commenters
suggested that those with the authority to opt out on behalf of a
library or archives could include a university agent (e.g., a dean or
associate dean) or a law firm.\36\ In contrast, AMI contended that ``a
blanket, institutional opt-out should not be permitted'' for
institutions or entities containing multiple archives.\37\ It argued
that ``[o]therwise, a complainant could have wasted money and time on
bringing an action only to have it thrown out because of ignorance of
institutional affiliation of the infringer.'' \38\
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\33\ 86 FR at 16161.
\34\ LCA NOI Initial Comments at 2.
\35\ Id.
\36\ AALL NOI Initial Comments at 2; Anthony Davis Jr. &
Katherine Luce NOI Initial Comments at 2.
\37\ AMI NOI Initial Comments at 2.
\38\ Id.
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The Copyright Alliance et al. suggested that ``[w]here a [library
or archives] is a part of a larger entity or municipality, such that
the [library or archives] itself does not have standing to act as a
Claimant or Counterclaimant on its own, only the larger entity or
municipality should be allowed to request the blanket opt-out on behalf
of the [library or archives].'' \39\ They reasoned that ``[b]ecause the
blanket opt-out could have major implications on an entity's exposure
to liability, only the larger entity should be allowed to make that
decision.'' \40\
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\39\ Copyright Alliance et al. NOI Initial Comments at 20.
\40\ Id. at 20-21.
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The Office generally agrees with LCA's suggestion that the
authority to exercise the preemptive opt-out option should belong to
any person with the authority to take legally binding actions
[[Page 49276]]
on behalf of the library or archives in connection with litigation. The
proposed rule incorporates this approach. Further, the Office does not
see a reason to restrict the ability of an institution to submit a
preemptive opt-out election for multiple libraries or archives that are
the part of the same institution in a ``blanket'' fashion, as the use
of separate submissions would be inefficient. Any preemptive opt-out
election involving multiple libraries or archives, however, should
separately identify the individual libraries or archives to be covered
by the submission, as opposed to providing a collective description
such as ``all university libraries.''
3. Transparency and Functionality Considerations
The NOI also asked for input ``related to transparency and
functionality considerations with respect to its publication of the
list of libraries and archives that have opted out.'' \41\ Commenters
generally agreed that the list of libraries and archives that have
preemptively opted out of participating in CCB proceedings should be
made publicly available online.\42\ The Office agrees, and accordingly
the list will be maintained on the Board's website.
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\41\ 86 FR at 16161.
\42\ AIPLA NOI Initial Comments at 5; Copyright Alliance et al.
NOI Initial Comments at 21; LCA NOI Initial Comments at 2.
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4. Application of the Opt-Out Provision to Persons in the Course of
Their Employment
Finally, the NOI asked parties to comment on whether the Office
``should include a regulatory provision that specifies that this opt
out extends to employees operating in the course of their employment.''
\43\ Commenters representing libraries and archives supported such a
rule, while others, including AIPLA and the Copyright Alliance et al.,
were opposed.
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\43\ 86 FR at 16161.
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Several library representatives, including AALL, LCA, the
University of Illinois Library, and the University of Michigan Library,
advocated for regulatory language specifying that the preemptive opt-
out extends to employees operating in the course of their
employment.\44\ As the University of Illinois Library argued, ``[t]o
provide a blanket opt out provision to libraries yet potentially hold
employees liable when working within the scope of their employment
would be to eviscerate the opt out provision as the work of libraries
is conducted by its employees, not by the entity itself.'' \45\ AALL
and the University of Illinois Library also argued that such a rule
would be consistent with section 108,\46\ which extends the statutory
exemption for libraries and archives to ``any of [the library or
archives'] employees acting within the scope of their employment.''
\47\
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\44\ LCA NOI Reply Comments at 3; Univ. Information Policy
Officers NOI Reply Comments at 1; AALL NOI Initial Comments at 2;
Anonymous II NOI Initial Comments at 1; Anthony Davis Jr. &
Katherine Luce NOI Initial Comments at 2; LCA NOI Initial Comments
at 3; Univ. of Ill. Library NOI Initial Comments at 2; Univ. of
Mich. Library NOI Initial Comments at 5; see also Science Fiction
and Fantasy Writers of Am. NOI Reply Comments at 2 (noting ``no
major objection to such a provision, so long as care is taken to
ensure that employees are in fact acting within the proper scope of
their employment and within the limits of 17 U.S.C. 108'').
\45\ Univ. of Ill. Library NOI Initial Comments at 2.
\46\ AALL NOI Initial Comments at 2 (citing 17 U.S.C. 108);
Univ. of Ill. Library NOI Initial Comments at 2 (citing 17 U.S.C.
108(a)).
\47\ 17 U.S.C. 108(a).
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In further support of this approach, LCA argued that Copyright
Claims Attorneys, who are required to review new claims to ensure that
they comply with the statute and regulations, would be able ``to
determine from the claim's statement of material facts whether the
respondent is a library employee acting with the scope of her
employment.'' \48\ It argued that such a determination would be no less
burdensome ``than to determine whether the respondent is a library that
has preemptively opted-out of CCB proceedings, a Federal or State
governmental entity,'' or ``a person or entity residing outside of the
United States''--all of which have to be determined by the CCB before a
claimant is allowed to proceed with a claim.\49\ LCA also contended
that ``[a]n employee's failure to opt out inevitably would result in
the library becoming enmeshed in the CCB proceeding on behalf of the
employee, contrary to Congressional intent.'' \50\
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\48\ LCA NOI Reply Comments at 3.
\49\ Id. (citing 17 U.S.C. 1504(d)(3)-(4)).
\50\ Id.
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The Copyright Alliance et al. opposed extending the libraries and
archives opt-out provision to employees acting within the scope of
their employment, arguing that ``[w]hether an employee is operating
within the course/scope of their employment is a question of fact that
would need to be determined by the CCB.'' \51\ In their view, ``[i]f a
claim is brought against an individual, and it is determined that the
claim should have been brought against a [library or archive] that has
elected to blanket opt-out, the claim should be dismissed.'' \52\ AIPLA
added that ``[d]eciding whether to extend a blanket opt out to
employees would require the CCB to determine ex parte whether employees
were operating in the course of their employment,'' which would
``undermine the adversarial process and increase the burden on the
CCB.'' \53\ Both AIPLA and the Copyright Alliance et al. noted that
individuals who are potentially acting within the scope of their
employment have the option to opt out of any CCB proceeding
themselves.\54\ AMI similarly stated that it did not support
regulations that would ``shield [a library or archive] employee from
liability for actions taken in the course of employment, but not
authorized or otherwise sanctioned by the employer [who opted out of
the CCB process].'' \55\
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\51\ Copyright Alliance et al. NOI Initial Comments at 21.
\52\ Id.
\53\ AIPLA NOI Initial Comments at 5.
\54\ Id. at 5; Copyright Alliance et al. NOI Reply Comments at
14.
\55\ AMI NOI Initial Comments at 2.
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The Office appreciates libraries' and archives' concerns that
excluding individual employees from the blanket opt-out could hamper
the effectiveness of that option by allowing parties to assert claims
against such individuals when claims against the institution are
unavailable. Such a rule, however, seemingly appears inconsistent with
principles of agency law and would require a broad interpretation of
the statutory text. While it is generally true that an employer may be
liable for the actions of employees taken within the scope of their
employment,\56\ the Office does not understand that principle to mean
that suits against the employee individually are precluded in such
circumstances. Rather, as a general rule, ``[u]nless an applicable
statute provides otherwise, an actor remains subject to liability
although the actor acts as an agent or an employee, with actual or
apparent authority, or within the scope of employment.'' \57\ Moreover,
the CASE Act expressly offers the preemptive opt-out option to ``a
library or archives,'' but does not mention employees.\58\ The
[[Page 49277]]
proposed rule accordingly does not include such a provision.
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\56\ See, e.g., Alan Latman & William S. Tager, Study No. 25:
Liability of Innocent Infringers of Copyrights 145 (1958) (``The
normal agency rule that a[n] [employer] is liable for [the
employee's] wrongful acts committed within the scope of employment
has been considered applicable to copyright infringement.''),
reprinted in Subcomm. on Patents, Trademarks, and Copyrights, S.
Comm. on the Judiciary, 86th Cong., Copyright Law Revision: Studies
22-25 135 (Comm. Print 1960); see also, e.g., Lowry's Reports, Inc.
v. Legg Mason, Inc., 271 F. Supp. 2d 737, 746 (D. Md. 2003) (holding
that employer was potentially liable for the infringing conduct of
its employee-agent).
\57\ Restatement (Third) of Agency sec. 7.01 (Am. Law. Inst.
2006).
\58\ 17 U.S.C. 1506(aa)(1).
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Some commenters further requested that the Office promulgate a
regulation expanding the statutory opt-out provision to a library's
larger institution,\59\ such as a university, or to that larger
institution's students, staff, adjunct, and faculty.\60\ For the same
reasons just noted, however, such a rule is inconsistent with the
statute's express limitation of this option to libraries and
archives.\61\
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\59\ LCA NOI Initial Comments at 3.
\60\ Anonymous II NOI Initial Comments at 1.
\61\ 17 U.S.C. 1506(aa)(1); see also 86 FR at 16161 (``Congress
did not establish a blanket opt-out for any entities other than
libraries and archives, and in that case, it did so expressly by
statute. This suggests that the Office lacks authority to adopt
other blanket opt-outs by regulation.'' (citing Antonin Scalia &
Bryan A. Garner, Reading Law: The Interpretation of Legal Texts 107
(2012); Lindh v. Murphy, 521 U.S. 320, 330 (1997))).
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5. Other Proposals
Commenters asked the Office to promulgate certain additional rules
related to participation by libraries and archives. First, some
commenters requested that the Office consider including regulations
allowing a library or archives to revoke or rescind its preemptive opt-
out election.\62\ As LCA explained, ``[a] library should not forever be
excluded from the CCB process because it exercises a preemptive opt-out
at one point in time.'' \63\ The Copyright Alliance et al. opposed this
proposal.\64\ As an alternative, they suggested that the Office could
create a ``two-tiered system,'' with the first tier allowing for
permanent opt outs and the second tier requiring recertification of the
institution's opt-out decision ``on an annual basis.'' \65\ In their
view, this approach ``would have the additional benefit of acting as a
routine `audit' to ensure that [libraries or archives] taking advantage
of the blanket opt-out continue to meet the qualifications for section
108.'' \66\
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\62\ Anthony Davis Jr. & Katherine Luce NOI Initial Comments at
2; CCIA & IA NOI Initial Comments at 4; LCA NOI Initial Comments at
3.
\63\ LCA NOI Initial Comments at 3.
\64\ Copyright Alliance et al. NOI Reply Comments at 12-13.
\65\ Id. at 13.
\66\ Id.
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The Office generally agrees that a library's or archives' opt-out
election should not be irreversible. Indeed, permitting such an
institution to rescind an opt-out would help advance the statutory goal
of encouraging participation in the CCB system. The proposed rule
accordingly provides that a library or archives may rescind a
preemptive opt-out election by providing written notification of such
intent to the CCB. To avoid potential abuses and to limit the impact on
CCB resources, the proposed rule provides that an institution may make
no more than one such rescission per calendar year.
In addition, two commenters proposed rules to address errors and
abuses involving the opt-out process. LCA urged the Office to establish
procedures to address circumstances where a Copyright Claims Attorney
erroneously allows a claim to proceed against a library.\67\ Verizon
proposed regulations to ``deter those who repeatedly abuse the opt-out
process,'' including the ability ``to impose monetary fines on bad
faith filers'' and ``the ability to ban such parties from future use of
the CCB process.'' \68\ While these suggestions are related to the
preemptive opt-out provisions for libraries and archives, they are more
appropriately considered in future CASE Act rulemakings addressing
errors in and abuses of CCB procedures generally.
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\67\ LCA NOI Reply Comments at 4.
\68\ Verizon NOI Initial Comments at 3-4.
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B. Class Actions
A CCB proceeding does not have any effect on a class action
proceeding in federal district court.\69\ If, however, a party in an
active CCB proceeding ``receives notice of a pending or putative class
action, arising out of the same transaction or occurrence'' as the
claim at issue before the CCB, the CASE Act provides that party with
two choices.\70\ The party must either ``opt out of the class action,
in accordance with regulations established by the Register,'' or seek
dismissal of the CCB proceeding in writing.\71\ In the NOI, the Office
asked for public comment on ``any issues that should be considered
relating to regulations governing dismissal or opt-outs related to
class action proceedings, including specific proposed regulatory
language.'' \72\
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\69\ 17 U.S.C. 1507(b).
\70\ Id. at 1506(q)(3).
\71\ Id. at 1507(b)(2); 1506(q)(3).
\72\ 86 FR at 16161.
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Two parties provided comments on this issue. The Copyright Alliance
et al. suggested that ``[i]f a party receives notice of a class action
and wishes to dismiss the case before the CCB, the regulations should
require that party to notify the CCB and the other parties to the case
within 10 business days following receipt of the class action notice.''
\73\ The MPA, RIAA, and SIAA did not suggest a specific time period,
but suggested that ``a party learning of a class action during the
pendency of a proceeding and wishing to exercise a class-action opt-out
should be required to do so promptly after learning of the class
action.'' \74\ The MPA, RIAA, and SIIA also voiced concerns that a
delayed opt out decision ``risks wasting effort and expense by the
litigants and the CCB, and the amount of wasted effort and expense
increases with the passage of time.'' \75\
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\73\ Copyright Alliance et al. NOI Initial Comments at 21.
\74\ MPA, RIAA & SIIA NOI Initial Comments at 9.
\75\ Id.
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The Office has proposed a fourteen-day period for a party to either
opt out of the class action or to seek dismissal of the CCB proceeding.
If a party chooses to opt out of the class action, he or she must file
written notice of that intent with the CCB within fourteen days after
filing such notice with the court. The proposed rule authorizes the
Board to extend these time periods for good cause.
List of Subjects in 37 CFR Part 223
Copyright, Claims.
Proposed Regulations
For the reasons set forth in the preamble, the Copyright Office
proposes to amend Chapter II, Subchapter B, of title 37 Code of Federal
Regulations to read as follows:
SUBCHAPTER B--COPYRIGHT CLAIMS BOARD AND PROCEDURES
0
1. The heading of Subchapter B is revised to read as set forth above.
0
2. Part 223 is added to read as follows:
PART 223--OPT-OUT PROVISIONS
Sec.
223.1 [Reserved]
223.2 Libraries and archives opt-out procedures.
223.3 Class action opt-out procedures.
Authority: 17 U.S.C. 702, 1510.
Sec. 223.1 [Reserved]
Sec. 223.2 Libraries and archives opt-out procedures.
(a) Opt-out notification. (1) A library or archives that wishes to
preemptively opt out of participating in Copyright Claims Board
proceedings under 17 U.S.C. 1506(aa) may do so by submitting written
notification to the Copyright Claims Board. The notification shall
include a signed certification under penalty of perjury that the
library or archives qualifies for the limitations on exclusive rights
under section 108 of title 17.
(2) The submission described in paragraph (a)(1) of this section
shall list the name and physical address of each
[[Page 49278]]
library or archives to which the preemptive opt out applies and shall
be signed by a person with the authority described in paragraph (c) of
this section. The library or archives must also provide a point of
contact for future correspondence, including phone number, mailing
address, and email address and shall notify the Copyright Claims Board
if this information changes.
(3) The Copyright Claims Board will accept the facts stated in the
submission described in paragraphs (a)(1) and (2) of this section,
unless they are implausible or conflict with sources of information
that are known to the Copyright Claims Board or the general public.
(4) If a federal court determines that an entity described in
paragraph (a)(1) of this section does not qualify for the limitations
on exclusive rights under section 108 of title 17, that entity must
inform the Copyright Claims Board of that determination and submit a
copy of the relevant order or opinion, if any, within fourteen days
after the determination is issued.
(5) A library or archives may rescind its preemptive opt-out
election under this section, such that it may participate in Copyright
Claims Board proceedings, by providing written notification to the
Copyright Claims Board in accordance with such instructions as are
provided on the Copyright Claims Board website. A library or archives
may submit no more than one such rescission notification per calendar
year.
(6) The notification described in paragraph (a)(1) of this section
shall be submitted to the Copyright Claims Board in accordance with
such instructions as are provided on the Copyright Claims Board
website.
(b) Review of eligibility. (1) The Copyright Claims Board will
maintain on its website a public list of libraries and archives that
have preemptively opted out of Copyright Claims Board proceedings
pursuant to paragraph (a) of this section. If the Register determines
pursuant to paragraph (a)(3) of this section that an entity does not
qualify for the preemptive opt-out provision, the Office will
communicate to the point of contact described in paragraph (a)(2) of
this section that it does not intend to add the entity to the public
list, or that it intends to remove the entity from that list, and will
allow the entity to provide evidence supporting its qualification for
the exemption within thirty days. If the entity fails to respond, or
if, after reviewing the entity's response, the Register determines that
the entity does not qualify for the limitations on exclusive rights
under section 108 of title 17, the entity will be not be added to, or
will be removed from, the public list. If the Register determines that
the entity qualifies for the limitations on exclusive rights under
section 108 of title 17, the entity will be added to, or remain on, the
libraries and archives preemptive opt-out list. This provision does not
limit the Office's ability to request additional information from the
point of contact listed pursuant to paragraph (a)(2) of this section.
(2) A party seeking to assert a claim under this section against a
library or archives that it believes is improperly included on the
public list described in paragraph (b)(1) of this section may file the
claim with the Copyright Claims Board pursuant to 17 U.S.C. 1506(e) and
applicable regulations. The claimant must include in its statement of
material facts allegations sufficient to support that belief. If the
Copyright Claims Board determines, as part of its review of the claim
pursuant to 17 U.S.C. 1506(f), that the claimant has alleged facts
sufficient to support the conclusion that the library or archives is
ineligible for the preemptive opt-out, and the claim is otherwise
complaint, the claimant will be instructed to proceed with service of
the claim. The respondent may include in its response any factual
statements in support of its eligibility.
(3) Any determination made under paragraph (b)(1) of this section
shall constitute final agency action under 5 U.S.C. 704.
(c) Authority. Any person with the authority to take legally
binding actions on behalf of a library or archives in connection with
litigation may submit a notification under paragraph (a) of this
section.
(d) Multiple libraries and archives in a single submission. A
notification under paragraph (a) of this section may include multiple
libraries or archives in the same submission if each library or
archives is listed separately in the submission and the submitter has
the authority described under paragraph (c) of this section to submit
the notification on behalf of all libraries and archives included in
the submission.
Sec. 223.3 Class action opt-out procedures.
(a) Opt-out or dismissal procedures. Any party to an active
proceeding before the Copyright Claims Board who receives notice of a
pending or putative class action, arising out of the same transaction
or occurrence as the proceeding before the Copyright Claims Board, in
which the party is a class member, shall either opt out of the class
action or seek written dismissal of the proceeding before Copyright
Claims Board within fourteen days of receiving notice of the pending
class action. If a party seeks written dismissal of the proceeding
before Copyright Claims Board, upon notice to all claimants and
counterclaimants, the Copyright Claims Board shall dismiss the
proceeding without prejudice.
(b) Filing requirement. A copy of the notice indicating a party's
intent to opt out of a class action proceeding must be filed with the
Copyright Claims Board within fourteen days after the filing of the
notice with the court.
(c) Timing. The time periods provided in paragraphs (a) and (b) of
this section may be extended by the Copyright Claims Board for good
cause shown.
Dated: August 24, 2021.
Shira Perlmutter,
Register of Copyrights and Director of the U.S. Copyright Office.
[FR Doc. 2021-18567 Filed 9-1-21; 8:45 am]
BILLING CODE 1410-30-P
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