2022-04745. Copyright Claims Board: Initiating of Proceedings and Related Procedures-Designation of Agents for Service of Process

AGENCY:

U.S. Copyright Office, Library of Congress.

ACTION:

Final rule.

SUMMARY:

The U.S. Copyright Office is amending its regulations to establish procedures governing the process by which corporations, partnerships, and unincorporated associations may designate agents to receive service of the initial notice of a proceeding and claim asserted against them before the Copyright Claims Board. The amended regulations provide the requirements for designating a service agent, amending the designation, and maintaining the directory of designated service agents.

DATES:

Effective April 7, 2022.

FOR FURTHER INFORMATION CONTACT:

Megan Efthimiadis, Assistant to the General Counsel, by email at [e-mail], or by telephone at 202-707-8350.

SUPPLEMENTARY INFORMATION:

On September 29, 2021, the Office published a notice of proposed rulemaking (“NPRM”) to establish procedures governing the initial stages of a proceeding before the Copyright Claims Board (“CCB”).^[1] The Office is finalizing aspects of that proposed rule addressing the CCB's designated service agent directory in this partial final rule. The Office anticipates publishing another final rule in the future addressing the remainder of the proposed changes.

I. Background

The Copyright Alternative in Small-Claims Enforcement (“CASE”) Act of 2020 ^[2] directs the Copyright Office to establish the CCB, a voluntary tribunal within the Office comprised of three Copyright Claims Officers who have the authority to render determinations on certain copyright claims for economic recoveries under the statutory threshold. The Office issued a notification of inquiry (“NOI”) to describe the CASE Act's legislative background and regulatory scope and to ask for public input on various topics,^[3] including a provision of the Act permitting corporations, partnerships, and unincorporated associations to designate agents to receive service of notices of proceedings and claims asserted against them.^[4] The CASE Act provides that service upon an entity that has designated a service agent must be made by delivering a copy of the notice and claim to that agent.^[5] The CASE Act also provides an alternative means for service upon corporations, partnerships, and unincorporated associations that have not designated a service agent.^[6]

Under the CASE Act, such entities may designate an agent “by complying with requirements that the Register of Copyrights shall establish by regulation” and the Register is directed to “maintain a current directory of service agents that is available to the public for inspection, including through the internet.” ^[7] The Register may require designating entities to pay a fee to cover the costs of maintaining the directory.^[8]

In September 2021, the Office published a NPRM to establish procedures governing the initial stages of a proceeding before the CCB.^[9] Among the provisions proposed in that notice were rules governing the process for designating a service agent. In both the NOI and the NPRM, the Office requested input on issues related to service of process and other papers in general as well as the designation of service agents in particular. Commenting parties were encouraged to review the Office's designated agent directory for online service providers created pursuant to the Digital Millennium Copyright Act (“DMCA”), and to discuss to what extent the Office should use that directory as a model. The Office also invited comments about how the system should indicate corporate parent-subsidiary relationships, and about fees.^[10]

The NPRM proposed a rule that would allow a submitter to provide the same designated agent information for multiple companies, partnerships, or unincorporated associations, but would require a separate submission for each entity. The proposal would have required that a submission include identifying information for the business, including contact information, principal place of business, and for corporations, the state of incorporation, any associated state file or registration number, and all other states in which the corporation is registered to do business. It would have permitted organizations to list up to five alternate names under which they are doing business, i.e., trade names, which would be used for indexing the designation. Submissions would also have to provide contact information for the service agent and the designating entity's consent to service by mail, with an option to elect, in addition, to accept service by email at an email address to be provided in the directory. Unlike the DMCA designated agent directory, the CCB's designated service agent directory (“DSAD”) would not have to be renewed periodically, although existing designations could be amended by the designating entity.^[11]

Noting that the fee for designating an agent in the DMCA designated agent directory is $6,^[12] the Office proposed the same fee for submitting or amending a designation to the DSAD.^[13]

II. Discussion

A. Limited Scope of This Rule

The NPRM addressed numerous issues concerning the initial stages of a CCB proceeding, and a final rule addressing the rest of those issues is forthcoming. Meanwhile, to facilitate the submission of service agent designations in advance of the CCB's acceptance of claims, the Office is publishing this final rule on designating service agents before publishing that forthcoming rule.

B. Overview

With a few exceptions discussed below, commenters generally supported the NPRM's proposed provisions on designating service agents. In response to those comments and for other reasons explained herein, the Office has revised the proposed rule to allow, under certain circumstances, inclusion of multiple affiliated entities in a single service agent designation, to increase the number of trade names that may be associated with an entity making a designation, and to make minor modifications regarding the information that must be provided in a designation. The final rule also includes some nonsubstantive technical edits to clarify the regulatory text, as well as the additional minor substantive edits described below.

The relevant proposed regulatory text in the NPRM was set forth as § 222.5(b) of the CCB regulations. For purposes of this final rule, the revised text has been removed from proposed § 222.5 (“Service”) and has become a new section, § 222.6 (“Designated service agents”). In the forthcoming final rule governing other aspects of the initial stages of CCB proceedings, proposed § 222.6 (addressing waiver of service) will be included as part of § 222.5.

C. Inclusion of Affiliated Entities in a Single Designation

The proposed rule would have permitted a qualifying entity to provide the same designated agent information for related companies, partnerships, or unincorporated associations, but would have required a separate submission for each of those related entities. The proposed rule followed the model of the Office's regulation governing the DMCA designated agent directory, which provides that “[r]elated or affiliated service providers that are separate legal entities ( e.g., corporate parents and subsidiaries) are considered separate service providers, and each must have its own separate designation.” ^[14]

Multiple commenters urged that the final rule permit a corporate parent to designate a single designated agent for affiliated corporations as part of a single submission. One commenter summarized the position, similar to those taken by others, by noting that under the Office's proposed rule, “companies with numerous subsidiaries may find it too burdensome to provide a separate submission for each subsidiary and will simply decline to designate a service agent. That would inconvenience copyright claimants, who will presumably rely on the designated service agent directory to determine where to serve their claim.” ^[15] Another commenter observed that its members anticipate needing to register service agents for many more entities under CCB than under the DMCA, as the range of activities relevant to DMCA designated agents is much narrower.^[16]

The Office finds that the arguments advanced by proponents of permitting affiliated business entities to file a single service agent designation are persuasive. It is in the interest of entities that designate service agents to have a system that encourages them to designate agents for all of their affiliated entities. It is also in the interest of all parties in CCB proceedings to have access to a directory of service agents that is comprehensive and facilitates their ability to take advantage of the more relaxed service requirements (including service by mail and, when the designating entity has agreed, by email) that apply to designated service agents. To implement such a revision, the Office finds it necessary to modify some of the other proposed requirements for service agent designations and impose some limitations.

Because the term “related” entities may be considered ambiguous, and to offer greater guidance as to what additional entities would be permitted to be included in a single service agent designation by a corporation, partnership, or unincorporated association, the final rule uses the term “affiliated,” which connotes a closer relationship than “related.” The following elaboration has been added to the regulatory text: “Affiliated corporations, partnerships, or unincorporated associations that are separate legal entities but are under direct or indirect common control ( e.g., parent and subsidiary companies) may also be included in the same service agent designation.” The concept of direct or indirect common control among affiliated entities is common in various areas of the law.^[17]

Because the Office's electronic DSAD system was at an advanced stage of development at the time the comments were received, there are certain constraints on the way in which affiliated entities can currently be included within a single designation. As discussed below, the system was already being built to accommodate up to five trade names based on a single designation. It is now being adapted to permit a combination of up 50 trade names and to enable affiliated entities to be included, indexed, and searchable based on a single designation. To be included as part of a single designation, affiliated entities must have their principal place of business in the same state and, for corporations, they must have the same state of incorporation. In addition, the names and contact information of the designated service agent and of the submitter must each be the same. The Office considers information regarding the principal place of business and state of incorporation to be important for purposes of providing accurate identification of the entity and avoiding misidentification ( e.g., in cases involving entities from different states with identical or similar names), and the system can only accommodate single designations for multiple entities where that information is identical.

With respect to an entity's principal place of business, the rule has been modified to clarify that the required information pertains to the state in which the entity's principal place of business is located. This modification has been made for three reasons: (1) To clarify ambiguous text in the proposed rule; (2) to facilitate the ability to submit designations for groups of affiliated entities, since requiring that the principal place of business for all affiliated entities be at the same address would likely disqualify many affiliated entities from being included in a single designation; and (3) to conform to the design of the electronic DSAD system.

For corporations, the proposed rule also would have required that the designation provide any state file or registration numbers from the state of incorporation, as well as identification of all additional states in which the corporation is registered to do business. Because a parent corporation and its subsidiaries or other affiliated corporations are not necessarily registered to do business in the same group of states, retaining this requirement would be likely to restrict significantly the ability of affiliated corporations to be included in a single designation. Commenters observed that it is not clear what benefit would be gained by requiring corporations to include, for themselves and their subsidiaries, state file or registration numbers and information on all states in which they are registered to do business; that requiring such information would be burdensome; and that such information is already readily available elsewhere, in a form that is accurate and up to date.^[18] The Office is persuaded that the time and costs involved in requiring such information outweigh the benefits, and those requirements have been removed in the final rule.

Finally, the rule requires that the following information be the same for all entities included in a single designation: Information pertaining to the designated agent; information pertaining to the person submitting the designation; and information on whether service may be made by email and mail or just mail.

D. The Number of Trade Names Permitted in a Single Designation

The proposed rule would have permitted qualifying entities to list no more than five trade names (alternate business names or “doing business as” (d/b/a) names) under which they are doing business. Inspired by a similar provision in the DMCA designated agent regulation, this would permit persons using the DSAD to more easily identify the designated agent for companies that might do business—and be recognized by the public—under names other than their corporate names. The DMCA directory imposes no limit on the number of “alternate names” (the term used in the regulation governing that directory) ^[19] that an online service provider may include for indexing and search purposes. However, based on the Office's understanding of the technical limitations of the electronic DSAD that it was developing at the time the NPRM was drafted, it proposed a five-trade-name maximum.

Some commenters objected to the five-trade-name maximum, noting that if a single entity does business under different names, all such names should be included on the same designation and observing that many entities, such as record companies, operate multiple imprints or labels that are trade names that are part of the same legal entity.^[20] Those comments, as well as the comments discussed above urging that the Office accept designations submitted on behalf of multiple designated entities, have persuaded the Office to raise the permitted number of trade names to 50,^[21] and to permit those 50 to be either trade names or the names of affiliated entities.

E. Additional Revisions

Other minor substantive revisions include a duty to maintain current information in the directory by submitting amendments when the information changes and a minor revision to the provision stating what information in a designation shall not be made publicly available on the DSAD website.

Regarding the obligation to keep directory information current, one commenter noted that large corporations will have a long and frequently changing list of related or affiliated corporations as well as partnerships and other associations, and encouraged the Office to provide sufficient leniency to correct any changes to corporate information and acknowledge that yearly updates should be deemed to be reasonable compliance.^[22] While the Office understands that changes may not be made instantaneously, there can be serious consequences, such as the service of claims on a person whom the designating entity no longer considers to be the correct service agent, when the directory contains out-of-date information. Therefore, any rule that would permit a business to defer an update of information in the directory as long as a year after the information has changed would be unacceptable. The final rule provides that when information that is in the directory is no longer valid, it should be updated promptly. While the Office does not believe that it is necessary to require updates on a regular basis, a requirement to update the information whenever it changes should ensure that it is kept up to date. Because there may be instances where a brief but understandable delay in updating the information results in service upon someone whom the designating entity no longer considers to be its service agent, the final rule provides that the CCB has the discretion to decide in particular cases whether service of an initial notice and claim was effective. However, an entity that has designated a service agent should be aware that if service is made upon the person who, at the time of service, appears in the directory as the respondent's designated service agent, that service is likely to be deemed effective. This should provide sufficient incentive to update the information promptly.^[23]

With respect to the public availability of DSAD information, the proposed rule would have provided that the business address, email, and telephone number of the corporation, partnership, or unincorporated association provided in the designation would not be publicly available on the DSAD website, but would be available to CCB staff. As revised, the entity's business address is removed from that provision. Although the Office has no present intention to include that information in the directory on the website, it recognizes that the business address of a business entity is not generally considered to be confidential information and that there may be occasions where knowledge of the business address may be helpful in determining which of two or more similarly or identically named entities is the one that a claimant needs to serve.

F. Fee

In the NPRM, the Office proposed a fee of $6 for designation of a service agent, payable upon the submission or amendment of a designation. The Office noted that this is the fee charged for submissions to the Office's similar DMCA designated agent directory. One comment suggested that the fee should be increased, noting that designations of agents for the DMCA directory must be updated every three years, but designations for the CCB service agent directory need not be renewed.^[24] While recognizing that distinction, the Office does not believe that a higher fee is justified at this time. The DSAD offers benefits not only to the entities that take advantage of the opportunity to designate service agents, but also to claimants in CCB proceedings who can use it to identify the agents to serve on behalf of the designating entities. Because an entity designating a service agent must accept service by mail and may also accept service by email, the directory provides claimants with a simple and inexpensive means to serve initial notices of proceedings and claims upon respondents who have designated service agents.

Moreover, as previously discussed, a provision added to the final rule obligates designating entities to maintain current information in the directory by amending an existing designation (and paying an additional $6 fee) whenever an update is needed. As a practical matter, most entities with designated agents are likely to have to submit amendments from time to time.

G. Mandatory Service on Designated Service Agent

The CASE Act requires that when a qualifying entity has designated a service agent, a claimant must serve the initial notice and claim upon that agent.^[25] Many commenters requested that the regulations clarify that this is the case.^[26] The Office agrees with that interpretation of the statute. Accordingly, in the interests of avoiding confusion, the Office shall address that issue in its forthcoming final rule addressing the remaining portions of the rulemaking on initiating proceedings, including § 222.5 on service.

List of Subjects

37 CFR Part 201

• Copyright
• General provisions

37 CFR Part 220

• Claims
• Copyright
• General

Final Regulations

For the reasons stated in the preamble, the U.S. Copyright Office amends Chapter II, Subchapters A and B, of title 37 Code of Federal Regulations as follows:

SUBCHAPTER A—COPYRIGHT OFFICE AND PROCEDURES

PART 201—GENERAL PROVISIONS

1. The authority citation for part 201 continues to read as follows:

Authority: 17 U.S.C. 702.

2. In § 201.3, revise the section heading and add paragraph (g) to read as follows:

§ 201.3

Fees for registration, recordation, and related services, special services, and services performed by the Licensing Section and the Copyright Claims Board.

* * * * *

(g) Copyright Claims Board fees. The Copyright Office has established the following fees for specific services related to the Copyright Claims Board:

Table 4 to Paragraph ( g )

Copyright Claims Board fees	Fees ($)
(1) [Reserved]
(2) Designation of a service agent by a corporation, partnership, or unincorporated association under 17 U.S.C. 1506(g)(5)(B), or amendment of designation	6

SUBCHAPTER B—COPYRIGHT CLAIMS BOARD AND PROCEDURES

3. Add part 222 to read as follows:

PART 222—PROCEEDINGS

222.1-222.5

[Reserved]

222.6

Designated service agents.

Authority: 17 U.S.C. 702, 1510.

§ 222.1-222.5

[Reserved]

§ 222.6

Designated service agents.

(a) In general. A corporation, partnership, or unincorporated association that is entitled under 17 U.S.C. 1506(g)(5)(B) to designate a service agent to receive notice of a claim may designate such an agent by submitting the designation electronically through the Board's designated service agent directory, which shall be available on the Board's website.

(b) Designation fee. A service agent designation shall be accompanied by the fee set forth in 37 CFR 201.3.

(c) Trade names and affiliated entities —(1) Trade names. Each corporation, partnership, or unincorporated association that submits a service agent designation may include up to 50 trade names that function as alternate business names ( i.e., “doing business as” or “d/b/a” names) under which such registered corporation, partnership, or unincorporated association is doing business.

(2) Affiliated entities. Affiliated corporations, partnerships, or unincorporated associations that are separate legal entities but are under direct or indirect common control ( e.g., parent and subsidiary companies) of the filing corporation, partnership, or unincorporated association may also be included in the same service agent designation, but only if all of the information required in paragraph (d)(1)(ii), (iii), and (v) through (vii) of this section is the same for the filing corporation, partnership, or unincorporated association and the affiliated corporation, partnership, or unincorporated association. Otherwise, those separate legal entities must file separate service agent designations, although a submitter may designate the same service agent for multiple corporations, partnerships, or unincorporated associations.

(d) Content of submission —(1) In general. The designated service agent submission shall include:

(i) The legal name, business address, email address, and telephone number of the corporation, partnership, or unincorporated association;

(ii) The state in which the principal place of business of the corporation, partnership, or unincorporated association is located;

(iii) For corporations, the state or territory (including the District of Columbia) of incorporation;

(iv) Up to 50 additional names, consisting of either the names of affiliated entities or trade names, or both, as described in paragraph (c) of this section;

(v) The name, business address (or, if the agent does not have a business address, the address of the residence of such agent), email address, and telephone number of the designated service agent;

(vi) The submitter's name, email address, and telephone number; and

(vii) The corporation, partnership, or unincorporated association's service method election, as described in paragraph (e) of this section.

(2) Certification. To complete the designation, the person submitting the designation shall certify, under penalty of perjury, that the submitter is authorized by law to make the designation on behalf of the corporation, partnership, or unincorporated association, including any other affiliated entities for which the filing is made.

(e) Service on designated agents. A corporation, partnership, or unincorporated association that designates a service agent shall, as a condition of designating a service agent, consent to receive service upon the agent by means of certified or priority mail at the identified mailing address. It may also indicate in its designation that it consents to receive service by email at the identified email address.

(1) Service by mail. The corporation, partnership, or unincorporated association shall identify the service agent's place of business or, if there is no place of business, the address of the service agent's residence for purposes of service by mail. The service agent's place of business or address of the service agent's residence must be located within the United States.

(2) Service by email. (i) If a corporation, partnership, or unincorporated association indicates that it consents to receive service by email, the designated service agent's email address shall be displayed on the designated service agent directory.

(ii) In cases where the designation states that service may be made by email, the person submitting the designation shall affirm under penalty of perjury that the corporation, partnership, or unincorporated association for which the agent has been designated waives the right to personal service by means other than email and that the person making the designation has been authorized to waive that right on behalf of the corporation, partnership, or unincorporated association and any other affiliated entity for which the filing is made for Board proceedings.

(f) Amendments. A corporation, partnership, or unincorporated association shall have a duty to maintain current information in the directory. A corporation, partnership, or unincorporated association may amend a designation of a service agent by following directions on the Board's website. Such amendment shall be accompanied by the fee set forth in 37 CFR 201.3. The requirements found in paragraph (d) of this section shall apply to the service agent designation amendment. If current information is not timely maintained and, as a result, the identification or address of the service agent in the directory is no longer accurate, the Board may, in its discretion and subject to any reasonable conditions that the Board may decide to impose, determine whether service upon that agent or at that address was effective.

(g) Public directory —(1) In general. After a corporation, partnership, or unincorporated association submits a service agent designation, such designation shall be made available on the public designated service agent directory after payment has been remitted and the Board has reviewed the submission to determine whether the submission qualifies for the designated agent provision.

(2) Removal from directory. If the Board determines that a submitted service agent designation does not qualify under this section or if it has reason to believe that the submitter was not authorized by law to make the designation on behalf of the corporation, partnership, or unincorporated association, it shall notify the submitter that it intends not to add the record to the directory, or that it intends to remove the record from the directory, and shall provide the submitter 10 calendar days to respond. If the submitter fails to respond, or if, after reviewing the response, the Board determines that the submission does not qualify for the designated service agent directory, the entity shall not be added to, or shall be removed from, the directory.

(3) Content of public listing. The designation shall be indexed under the names of each corporation, partnership, or unincorporated association for which an agent has been designated and shall be made available on the Board's website. The email address and telephone number of the corporation, partnership, or unincorporated association provided under paragraph (d)(1)(i) of this section shall not be made publicly available on the designated service agent directory website, but such information shall be made available to Board staff.

(4) Designation date. A designation filed in accordance with this section before April 7, 2022 will become effective on that date.

Dated: February 28, 2022.

Shira Perlmutter,

Register of Copyrights and Director of the U.S. Copyright Office.

Approved by:

Carla D. Hayden,

Librarian of Congress.

Footnotes

1.  86 FR 53897 (Sept. 29, 2021).

2.  Public Law 116-260, sec. 212, 134 Stat. 1182, 2176 (2020).

3.  86 FR 16156, 16161 (Mar. 26, 2021).

4.  15 U.S.C. 1506(g)(5)(B).

5.   Id. at 1506(g)(5)(A).

6.   Id. at 1506(g)(5)(A)(i)-(ii).

7.   Id. at 1506(g)(5)(B).

8.   Id.

9.  86 FR 53897.

10.   Id. at 53900-01; 86 FR at 16160.

11.  86 FR at 53900-01; see also id. at 53907-08 (proposing § 222.5(b)).

12.  37 CFR 201.3(c)(23) (assigning the fee for “[d]esignation of agent under 17 U.S.C. 512(c)(2) to receive notification of claimed infringement, or amendment or resubmission of designation”).

13.  86 FR at 53904; see also id. at 53905 (proposing § 201.3(g)(2)).

14.  37 CFR 201.38(b)(1)(i).

15.   See, e.g., Amazon.com , Inc. (“Amazon”) Initial NPRM Comments at 5; see also Computer & Comm's Indus. Ass'n (“CCIA”) & internet Ass'n Initial NPRM Comments at 4; Motion Picture Ass'n, Recording Indus. Ass'n of Am. & Software and Info. Ass'n of Am. (“MPA, RIAA & SIIA”) Initial NPRM Comments at 5-6; Verizon Initial NPRM Comments at 2.

16.  MPA, RIAA & SIIA Initial NPRM Comments at 5-6.

17.   See, e.g., 26 U.S.C. 168(h)(4)(B)(ii) (defining “related entities,” for certain federal income tax purposes, as entities having “directly or indirectly substantial common direction or control”); 47 U.S.C. 152(b) (withholding FCC jurisdiction over a “carrier engaged in interstate or foreign communication solely through physical connection with the facilities of another carrier not directly or indirectly controlling or controlled by, or under direct or indirect common control with such carrier”); 15 U.S.C. 78l(b)(1) (requiring applications for registration of a security with SEC to include information regarding “the issuer and any person directly or indirectly controlling or controlled by, or under direct or indirect common control with, the issuer”).

18.  Amazon Initial NPRM Comments at 5; Verizon Initial NPRM Comments at 2.

19.  37 CFR 201.38(b)(2).

20.  MPA, RIAA & SIIA Initial NPRM Comments at 6-7; see also Verizon Initial NPRM Comments at 4.

21.  The Office has adopted a 50-trade-name maximum after consulting with the developers of the electronic DSAD, who are confident that the system will be able to accommodate up to 50 names per entity, but not necessarily a greater number in the available time before its launch.

22.  Verizon Initial NPRM Comment at 2.

23.  Although a change in the identity of the designated service agent is the most crucial information in the directory, delays in updating other information can also have consequences. Information such as legal name of a corporation, partnership, or unincorporated association, or about the principal place of business or state of incorporation, can be of great assistance to a claimant in identifying the correct respondent to be served.

24.  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 Artists Coalition, Music Creators N. Am., Nat'l Music Council of the U.S.A., Nat'l Press Photographers Ass'n, N. Am. Nature Photography Ass'n, Prof'l Photographers of Am., Recording Acad., Screen Actors Guild-Am. Fed. of Television & Radio Artists, Soc'y of Composers & Lyricists, Songwriters Guild of Am. & Songwriters of N. Am. (“Copyright Alliance et al.”) Initial NPRM Comments at 15-16.

25.  17 U.S.C. 1506(g)(5).

26.   See, e.g., MPA, RIAA & SIIA Initial NPRM Comments at 7-8; Verizon Initial NPRM Comments at 4; Copyright Alliance et al. Reply NPRM Comments at 14-15.