It’s a new year, and the world is split between those who
call it “two thousand nineteen” and those who say “twenty nineteen.” What can
we expect in U.S. copyright law and policy over the next twelve months?
Let’s take a look.
The 116th Congress gaveled in on January 3, 2019, and the most significant change from the 115th Congress is the flip in party control of the majority. While copyright historically has been a nonpartisan issue, the change in majority control will affect what non-copyright issues will receive priority and thus what attention will remain for copyright issues.
The House Judiciary Committee has jurisdiction over
intellectual property, but it also has jurisdiction over several other key
political issues. It’s most likely that those issues will dominate the
Committee’s attention for at least the first several months of the new
Congressional session. But when it does turn toward copyright, it will do so
under the eyes of two Representatives who have been very active on copyright
issues. Both Chairman Jerrold Nadler (D-NY) and Ranking Member Doug Collins
(R-GA) were critical to the drafting and passage of the Orrin G.
Hatch-Bob Goodlatte Music Modernization Act (MMA), which was signed
into law last October, and have introduced or co-sponsored many other copyright
bills over the years.
Among the first set of issues that the Committee might take
up this year is copyright small claims. Last session, Reps. Hakeem Jeffries
(D-NY) and Tom Marino (R-PA) introduced the Copyright
Alternatives in Small Claims Enforcement (CASE) Act, which would have
created a streamlined tribunal for hearing small copyright claims based off
recommendations made by the US Copyright Office in its 2013
report on small copyright claims. The Committee held a hearing
on the bill just this past September, with a number of members indicating
support for moving the bill forward.
We may also see a bill addressing resale royalty rights. A resale royalty provides visual and fine artists—who often rely primarily on income from the sale of their individual works rather than licensing their exclusive rights provided through copyright—with the opportunity to capture a percentage of the proceeds when their works are resold through art auctions. Although there have been a number of resale royalty right bills introduced in previous Congressional sessions that never advanced, there are at least two indications of greater momentum this session: first, the issue’s biggest supporter, Chairman Nadler, is now in charge of the Committee, and second, the most recent bill, the American Royalties Too Act of 2018, was introduced in both the House and Senate by Judiciary Committee leaders, giving it a higher stature than previous versions of the bill.
The Committee may also continue its work on modernizing the Copyright Office. In 2016, it identified modernization as the first issue it would address following its three-year review of copyright law. Part of that proposal—elevating the Register of Copyrights to a Presidential appointment with the advice and consent of the Senate—was introduced as a separate bill, the Register of Copyrights Selection and Accountability Act, in March 2017, given the current lack of a permanent Register. The bill easily passed the House with a vote of 378-48 in April 2017 but stalled in the Senate Rules Committee. Momentum resumed several months ago, with the Committee holding a hearing on the bill in September, but the bill was unable to make it to the Senate floor before the end of the legislative session.
The copyright compulsory licenses for satellite retransmission of distant broadcast signals (along with related Communications Act provisions) are due to expire at the end of 2019. The compulsory license, found in 17 USC §119, was originally created by Congress in 1988, when the satellite television industry was still in its infancy, and set to expire in 1994. But Congress reauthorized the compulsory license for an additional five years, and continued to do so (along with other changes), most recently with the STELA Reauthorization Act of 2014. Will it reauthorize again before the provisions expire on December 31, 2019 or let them sunset? We can already see positions being staked out: for example, the National Association of Broadcasters is supporting the law’s expiration, while the Satellite Broadcasting & Communications Association is looking to make the provisions permanent.
What other issues may advance over the next twelve months? One possibility is a terrestrial performance right for sound recordings, the subject of perennial legislative efforts since the 1950s. When Congress extended federal copyright protection to sound recordings in 1971, it did not extend the right of public performance to them. In 1995, Congress extended to sound recording owners the exclusive right to perform the work publicly by means of a digital audio transmission, but legislative efforts for a full public performance right since then have been unsuccessful. A terrestrial performance right for sound recordings was not included in the Music Modernization Act, but now that that bill has passed, some in the music industry are returning their attention to the issue, hoping to build on the momentum of the MMA.
U.S. Copyright Office
The U.S. Copyright Office will continue to work at a brisk pace through 2019 (and unaffected by the government shutdown). A lot of that work will focus on modernizing the Office itself. As Congress looks at broader structural changes and other modernization issues that require legislative attention, the Office, in coordination with the Library of Congress, has been focused on those areas that don’t require legislative attention, such as IT, operations, and regulations—in its own words, its modernization efforts seek to “(1) build a new enterprise copyright system featuring a user-centered and flexible design, (2) streamline processes and policies, (3) improve access [to its public records], and (4) reimagine the entire Office.”
Currently the Office is seeking public comments on modernizing its registration system. It will incorporate these public comments into the development of the technological infrastructure for a new registration system, though we likely won’t see any public-facing results this year. It is possible, however, that we may see an initial version, toward the end of this year, of the Office’s updated recordation system, which is less complex than the registration system and which the Office began working on earlier.
As part of its modernization efforts, the Office has been
working on updating its rules and regulations to streamline Office practices
and anticipate updated systems. Currently, it is collecting public comments on
a number of proposed rules it issued toward the end of 2018, including a
group registration option for blogs and other collections of short,
online literary works, and simplifying
copyright registration for architectural works. We can likely expect
final rules for those sometime in 2019, along with any number of additional
Finally, the Copyright Office last year proposed an updated
fee schedule for its services, as it periodically does. The proposal
generated a healthy number of public comments in response, most voicing
concerns about proposed fee increases for copyright registration. We will
likely see a follow up to the proposal, perhaps in the earlier part of 2019.
On the policy front, 2018 came and went without the release
of the Office’s long-awaited report on Section 512,
which establishes safe harbors for online service providers and provides a
notice-and-takedown system for addressing online infringement. The Office
launched the study December 31, 2015 to evaluate the impact and effectiveness
of the law, which was enacted in 1998. Through February 2017, it solicited two
rounds of public comments and held a series of public roundtables to gather
input. I predicted that we should see the release of the final report last year.
The Copyright Office doesn’t have any formal timeline for
releasing the study, and it’s not surprising that it hasn’t been released yet,
considering the scope and complexity of the issues it has solicited feedback
on. At this point, given the amount of time since it has collected public
input, the Office may, as it did
for its study on the Making Available right, solicit an additional round of
public comment to address any new developments in case law, technology,
business practices, or developments in foreign countries that are relevant to assessing
the impact and effectiveness of Section 512.
The Copyright Office has also previously initiated public
studies on moral rights
and copyright issues for
visual works. It’s possible we may see developments—whether in the
form of a written report or further inquiries—on either of these some time in
the coming year.
Music Modernization Act
MMA was signed into law October 11, 2018, the most significant copyright
legislation in at least a decade, if not two, and we should expect the law to
begin being implemented throughout 2019, with the Copyright Office charged with
of those duties.
The largest and most complex component of the MMA is the
establishment of a Mechanical Licensing Collective to collect, administer, and
distribute royalties under the blanket license created by the law for
mechanical reproductions of musical compositions. Although the blanket license
will not be available until January 1, 2021, much work will be done before then
in preparation. The Copyright Office has already issued a notice regarding
designation of the Collective and is accepting initial comments
through March 21 and reply comments through April 22. It will use those
comments to identify the entity that will act as the Mechanical Licensing
Collective, something it is required by law to do within 270 days of the MMA’s
enactment (sometime in mid-July of this year). The same process is being used
to identify the Digital Licensee Coordinator, an entity created by the MMA to
act as a sort of representative for the digital music providers. The Copyright
Office has initiated a number of other rulemakings related to the
implementation of the MMA and may release others in the upcoming months.
Also within 270 days of the enactment date, the Copyright
Royalty Judges will commence proceedings to determine the initial
administrative assessment for the Mechanical Licensing Collective—i.e., the fee
that licensees must pay to cover the costs of operating the Collective. That
proceeding must be concluded within one year of commencement.
Title II of the MMA provides federal protection for pre-1972
sound recordings and creates a new exception that would allow the noncommercial
use of pre-1972 sound recordings that are not being commercially exploited. The
Copyright Office solicited comments
regarding requirements for this exception in October, and we can
reasonably expect to see the final rules and guidance issued sometime this
U.S. Patent and Trademark Office
The USPTO, despite its name, provides advice to the
Administration and other federal agencies and analysis on all types of
intellectual property issues, including copyright. It
is currently operating during the
shutdown by using prior-year fee collections but may cease
operations if those funds are exhausted before the shutdown ends.
At the end of this month, the USPTO has scheduled a conference
on the intellectual property considerations of artificial intelligence.
The topics to be discussed include “the copyright implications when AI is used
to create new works or when copyrighted works are used to ‘train’ artificial
intelligence systems.” This event was originally scheduled for December 2018
but postponed following the passing of former President George H.W. Bush.
The Federal Trade Commission is currently not operating during the shutdown, but when that ends, the FTC will resume a series of hearings it has been holding since September on “Competition and Consumer Protection in the 21st Century.” The purpose of the hearings is to consider whether “broad-based changes in the economy, evolving business practices, new technologies, or international developments might require adjustments to competition and consumer protection enforcement law, enforcement priorities, and policy.” The FTC held a hearing focusing on the role of intellectual property and competition policy in promoting innovation last October and collected public comments on that issue through late December. While the hearing and comments touched upon general copyright issues relating to competition, including piracy and enforcement, much of the focus was on software copyright issues. The FTC will provide an additional opportunity for public comment at the conclusion of all hearings, which were originally scheduled to end in January. The FTC has modeled these hearings after its 1995 “Pitofsky hearings” on global competition and innovation. The 1995 hearings cumulated in a report published in 1996, though the FTC has not indicated any explicit outcomes for the current series of hearings.
Property Enforcement Coordinator will likely release its Joint
Strategic Plan for 2019-2021 in the coming weeks. The IPEC, which is charged
with coordinating and developing U.S. intellectual property policy and strategy
across the numerous agencies involved with IP issues, is directed by Congress
to develop a joint strategic plan on intellectual property enforcement every
three years. The IPEC
solicited public comment to help prepare its latest plan last
Much activity on the trade front can be expected in 2019, though
it is unlikely copyright issues will be in the forefront.
The United States, Canada, and Mexico signed
a renegotiated trilateral agreement on November 30, 2018, which has been
renamed the USMCA (at
least in the US) and replaces NAFTA. As with prior free trade agreements
(including the original NAFTA), the agreement includes a chapter on minimum
standards for intellectual property protection. The chapter is generally
consistent with US law, but may require some changes to Canadian and Mexican
law, and while some specific provisions have raised concern among the copyright
community, the overall response to the chapter has been positive.
The agreement must now be ratified and implemented in each
of the three countries before going into effect. To qualify for fast-track
consideration in Congress under Trade Promotion Authority, the U.S.
International Trade Commission has until mid-March of this year to issue a
report on the likely
economic impacts of the new agreement. The Administration is also
required to submit a list of required changes to U.S. law under the agreement
to Congress by the end of January.
From there, the timeline for implementation remains indeterminate—there is no deadline for introducing implementing legislation in Congress. But the Administration is required to submit a final draft of the agreement and a Statement of Administration Action, which provides a proposal for implementing the agreement, to Congress 30 days prior to submitting its draft of implementing legislation to Congress. And once that occurs, it triggers a series of deadlines for Congress to bring implementing legislation to the floor for expedited consideration.
The U.S. last October announced
its intention to enter into trade negotiations with Japan, the European Union,
and the U.K. The US Trade Representative’s intellectual property negotiating
objectives for the Japan agreement are virtually identical to those it
published for the NAFTA
renegotiations, so we likely won’t expect any copyright-related surprises
there. We can likely see even less copyright-related news in the European Union
negotiations, since those talks are expected to have a limited
The wild card here is the U.S.-U.K. negotiations. Those cannot
begin until after the U.K. has exited the European Union on March 29, 2019—though how (and
if) that happens remains uncertain. The U.S. and U.K. obviously share a long
historical kinship on copyright law, and both provide high standards of
protection. The USTR is accepting public comments on negotiating objectives for
the potential agreement until January 15 and will hold a public hearing on
January 29. Both will provide some indication of what copyright stakeholders
would like to see in any trade agreement.
The Supreme Court begins the year with
two copyright cases on its docket, both of which will be argued over the next
two weeks. In Fourth
Estate Public Benefit Corp. v. Wall-Street.com, the Court will settle
the Circuit split over when a copyright owner has satisfied the registration
requirement and can file a lawsuit. That case will be argued tomorrow, January
8. In Rimini
Street v Oracle, the Court will determine what costs a court may award
a prevailing party under 17 USC § 505. Oral arguments
are scheduled for January 14. Decisions for both cases should come out before
the end of the Court’s term in June, and likely sooner than that.
Parties in a number of interesting copyright cases have or are expected to file cert petitions in early 2019. Those cases include: Rentmeester v Nike (scope of copyright protection for photographs), Stevens v Corelogic (§1202 mental state requirement, cert filed January 3), Allen v Cooper (state sovereign immunity for copyright infringement, cert due today), Google v Oracle (copyrightability and fair use of Java software code, cert due January 25), and Georgia v Public Resource (scope of government edicts doctrine, cert due March 4).