CASE Act grants legal tools to fashion designers


As 2022 approaches, there are a few important developments that every copyright owner should be aware of. One is based on a brand new Supreme Court decision, and the other is the upcoming implementation of the Alternative to Copyright in Small Claims Enforcement Act (CASE Act). These developments aim to make legal action against copyright infringers more accessible and efficient. As a result, these new advancements give fashion designers additional legal tools they can use in their intellectual property protection arsenal. The main takeaways from Unicolors v. H&M and the upcoming CASE Act are highlighted below.

The United States Supreme Court rules that defective copyright registrations based on errors of law do not invalidate the registrations or prevent enforcement action.

On Thursday, February 24, 2022, the United States Supreme Court ruled on the longstanding copyright infringement dispute between Los Angeles fabric designer Unicolors Inc. and the global textile giant. fast fashion, H&M Hennes & Mauritz LP

Unicolors’ lawsuit against H&M began in 2016 in the Central District of California. Unicolors alleged that H&M incorporated one of its copyrighted fabric designs, a geometric pattern, without its permission in connection with jackets and skirts. After a jury trial finding a violation, H&M was ordered to pay nearly $800,000 in damages and attorneys’ fees and costs. Following this verdict, H&M appealed to the Ninth Circuit, which overturned the decision. The Ninth Circuit ruled that Unicolors’ copyright registration could potentially be revoked for failing to meet the “unique unit of publication” requirement. The appeals court sent the case back to the high court, directing it to refer to the copyright register to determine whether such an inaccuracy would have resulted in the denial of registration. Before the suit was dismissed, Unicolors appealed to the United States Supreme Court.

In its 6-3 decision, the Supreme Court reversed the Ninth Circuit’s decision and held that unintentional inaccuracies in a copyright registration do not invalidate that registration, nor do they prevent the copyright owner from author to bring a valid infringement action. The crux of the Supreme Court’s issue was to determine the scope of the phrase “knowingly inaccurate,” as stated in section 411(b)(1)(A), the provision of exemption from the law. Breaking with the Ninth Circuit, the Supreme Court found that Section 411(b) does not distinguish between error of law and error of fact – in other words, either error is grounds. justifiable to excuse the inaccuracy of a copyright record.

In reaching this decision, the Supreme Court cited numerous statutory references and case law that are consistent with the notion that forgiveness of copyright plaintiff’s legal errors were as much intended to be included as factual errors. Perhaps most central to the Supreme Court’s position was the fact that, based on the commentary records of Congressional reports, the intent of Congress in enacting Section 411(b) in the first place was to benefit the non-lawyer by registering and enforcing copyright. easier, not harder. Thus, invalidating a copyright registration due to errors of law, particularly copyright law which is “often esoteric,” would undermine congressional intent.

CASE Act Copyright Small Claims Court

In December 2020, Congress passed the Copyright Alternative in Small-Claims Enforcement Act of 2020 (the “CASE Act”) which established what is colloquially referred to as a small-claims court for infringement litigation. Instead of filing suit in federal court, which is often prohibitive given the lengthy process and high legal costs, the CASE Act established the Copyright Claims Board (the “CCB”) as a more faster and more cost-effective federal litigation for litigation with a monetary value of up to $30,000. Through the CCB, litigants must register each other, which means that if a defendant does not wish to participate in the CCB trial, the claim will not be pursued. In this case, the plaintiff can still take their case to federal court.

The CWB tribunal, which is expected to begin operations as early as spring 2022, will cap statutory damages at $15,000 and actual damages at $30,000 (excluding attorneys’ fees and costs, which in circumstances of bad faith, are available up to a capped amount of $5,000). It will also offer declaratory relief which may include declarations of infringement/non-infringement.

Unlike traditional copyright litigation in federal district court, CCB decisions will be made by a three-judge tribunal (requiring consensus among two of the three judges). Further, CWB rulings will not create new law or any form of precedent, and will operate only in accordance with interpretations of existing statutes and case law of the applicable federal jurisdiction.

Although the CCB aims to ease the entry burden for plaintiffs to sue for copyright infringement, paving the way for a new outlet for minor disputes to be resolved, the mutual opt-in procedure will likely result in the CCB hearing cases between small parties. Because large defendants have a disproportionate amount of resources compared to small plaintiffs, these defendants are likely to refuse to participate in CWB business, knowing that the plaintiffs will not have the resources to bring a federal action. Therefore, we suspect that the CCB will primarily serve as an alternative dispute resolution forum for relatively small businesses. Nevertheless, it is a new and viable option that designers can use to enforce their copyrights.


Comments are closed.