Understanding Copyright Law: Client's Breach And Consequences

Copyright infringement occurs when anyone other than the owner violates their exclusive rights. For example, if someone sells copies of your e-book without your permission, that's a potential copyright violation. The penalties for breaking copyright law range from a sternly worded letter to jail time. The CASE Act, signed into law in December 2020, sets up a three-judge panel to hear cases with damages capped at $15,000 per claim and $30,000 in total. The U.S. Copyright Act of 1976 also outlines punishments for infringing copyright, including removal of copyrighted material, confiscation of infringing items, legal injunctions, and payment of money earned or value lost due to infringement.

Criminal vs civil infringement

Criminal and civil infringement differ in terms of the parties involved, the penalties, and the requirements for proving infringement.

Criminal Infringement

Criminal copyright infringement is a violation of federal law. It occurs when a person intentionally uses or distributes copyrighted material for financial gain. This typically involves deliberate acts such as reproducing or distributing at least 10 copies of a copyrighted work within an 180-day period, with a retail value exceeding $2,500. Criminal infringement carries severe penalties, including fines, prison sentences, restitution, and felony or misdemeanour charges.

Civil Infringement

Civil copyright infringement, on the other hand, is a matter between two private parties. It does not involve criminal charges unless the government intervenes due to intentional and illegal use or sharing of copyrighted material. In civil cases, the copyright owner can seek remedies such as injunctions, damages, and legal fees.

Requirements for Proving Infringement

To prove criminal copyright infringement, the government must demonstrate four elements: the existence of a valid copyright, infringement by the defendant, willfulness, and the purpose of commercial advantage or private financial gain. In contrast, civil copyright infringement cases may require additional elements, such as the absence of a first sale or inducement to break the law.

Fair use

The fair use doctrine is codified in Section 107 of the US Copyright Act, which outlines four factors to be considered when evaluating whether a particular use of copyrighted material is fair:

• Purpose and character of the use: Non-profit educational and non-commercial uses are generally viewed more favourably, but this does not mean that all non-profit uses are fair. Courts will also look more favourably upon "transformative" uses, which add something new to the original work and serve a different purpose or character.
• Nature of the copyrighted work: This factor considers the degree to which the use of the copyrighted material relates to copyright's purpose of encouraging creative expression. Using a highly creative or imaginative work, such as a novel or song, is less likely to be considered fair than using a factual or technical work.
• Amount and substantiality of the portion used: Courts will consider both the quantity and quality of the copyrighted material that was used. Using a large portion of the copyrighted work or using a small but essential part of it (the "heart" of the work) will weigh against fair use. However, using a small and non-essential portion is more likely to be considered fair.
• Effect on the potential market for the copyrighted work: This factor looks at whether the unlicensed use harms the existing or future market for the original work. If the unlicensed use results in lost sales or could cause substantial harm if it became widespread, this will weigh against fair use.

It is important to note that fair use is determined on a case-by-case basis, and there is no formula to guarantee that a specific percentage or amount of a copyrighted work can be used without permission. The four factors outlined above are the primary considerations, but other factors may also be relevant depending on the specific circumstances of each case.

Litigation

If the person still violates your copyright, you may need to take the case to civil court. There are organizations that offer services to authors and copyright owners, such as Volunteer Lawyers for the Arts, at a lower cost than a regular attorney. The CASE Act, signed into law in December 2020, also provisions a new avenue for certain copyright infringement cases to be tried in small claims court, with damages capped at $15,000 per claim and $30,000 in total.

In civil court, a plaintiff alleging copyright infringement must establish two essential elements. Firstly, they must demonstrate that they own a valid copyright. This involves showing that the work is original and exists in a "tangible medium of expression". Secondly, the plaintiff must prove that the defendant violated their exclusive rights to the work. This can be done by presenting evidence of the defendant's unauthorized display of the copyrighted work, such as a pirated edition of a book offered for sale.

If the court finds that the plaintiff's copyright has been breached, the plaintiff may be awarded civil damages, with fines levied against the defendant. These fines typically range from $750 to $30,000 per work infringed, but can increase to $150,000 or more per work if the infringement is found to be willful. The defendant may also be required to compensate the plaintiff for court costs and attorney's fees, and will usually receive an injunction barring them from continuing the infringement.

Copyright infringement may be prosecuted as a criminal offense if the defendant acted willfully and sought financial gain or had another commercial impetus. Criminal copyright infringement can result in criminal penalties, including imprisonment of up to five years and fines of up to $250,000 per offense.

Evidence of ownership

Copyright ownership gives the owner the exclusive right to use the work, with some exceptions. When a person creates an original work, fixed in a tangible medium, they automatically own the copyright to the work. In the case of a work made for hire, the employer or other person for whom the work was prepared is considered the author and owns all the rights comprised in the copyright, unless otherwise agreed upon in writing.

Copyright law protects "original works of authorship" that exist—or could exist—in a "tangible medium of expression." This includes books and other literary works, musical compositions, musical recordings, visual works like paintings or photographs, films and videos, and computer code.

To establish ownership of a valid copyright, a plaintiff must demonstrate that the work is original and that it is subject to legal protection. Registering a work with the U.S. Copyright Office is not necessary but creates rebuttable presumptions as to both validity and ownership.

In the case of a dispute, the owner of the copyright must provide evidence of ownership. This can be done by registering the work with the U.S. Copyright Office, which creates a rebuttable presumption of ownership. Additionally, the owner can provide evidence of the creative process, such as drafts, sketches, or notes, to show the development of the work from its initial stages to the final product.

It is important to note that ownership of a copyright is distinct from ownership of any material object in which the work is embodied. For example, if someone purchases a painting, they own the physical object but do not have the right to reproduce or distribute copies of the painting without the copyright owner's permission.

In summary, evidence of ownership of a copyright can include registration with the U.S. Copyright Office, the creative process and development of the work, and, in the case of employment, written agreements specifying ownership rights.

Penalties

According to the U.S. Copyright Act of 1976, punishments for infringing copyright include:

• Removal of copyrighted material.
• Confiscation of infringing items.
• Legal injunctions to prevent further copyright infringement.
• Payment of money earned or value lost due to infringement, from $200 to $150,000 per work.
• Court costs and attorneys' fees.

Additionally, the Digital Millennium Copyright Act (DMCA) of 1998 introduced anti-circumvention laws, which carry severe punishments of up to 10 years in prison and fines up to $1 million. This act also provides safe harbour to select internet services, protecting them from penalties related to their users' copyright violations as long as they act swiftly to remedy the situation.

It is important to note that copyright infringement becomes a criminal offence when the offender knowingly reproduces or distributes more than 10 copies of one or more works valued at $2,500 or more within 180 days. This is considered a felony and is punishable by up to five years in prison.

Frequently asked questions