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Federal Register / Vol. 86, No. 233 / Wednesday, December 8, 2021 / Proposed Rules
jspears on DSK121TN23PROD with PROPOSALS3

and the third party requesting intervention. If the CCB determines that the intervening party is not a necessary party, it will deny the request and the proceeding will continue with the original parties. If the CCB determines that the intervening party is a necessary party, it will permit the intervening party to join the proceeding, as long as no other party opposes the intervention.
A party opposing the intervention of a necessary party will not need to provide reasons for its opposition. If any party opposes the intervention, the proceeding will be dismissed without prejudice. The proposed rule thus permits a necessary party to be joined only if all parties agree.
The Office welcomes any comments as to whether the statute permits joinder of parties as outlined in the proposed rule and the appropriateness of the procedures proposed herein.
2. Dismissal Under the statute, a claimant may elect to voluntarily dismiss a claim, respondent, or proceeding by written request at any time before a respondent files a response to the claim.14
Similarly, a counterclaimant may elect to voluntarily dismiss a counterclaim by written request before the claimant files a response to the counterclaim.15 Upon receipt of such a written request, the CCB shall dismiss the claim or counterclaim, as the case may be, without prejudice.16
The statute is not explicit as to whether a party may voluntarily withdraw a claim or counterclaim after a response to it has been filed. The Offices proposed rule addresses this scenario and provides that, if a written request to withdraw a claim or a counterclaim is received after the response has been filed, the CCB will dismiss the claim or counterclaim with prejudice, unless all parties have entered into a written stipulation that the claim or counterclaim will be dismissed without prejudice or unless the CCB determines the dismissal should be without prejudice in the interests of justice. This procedure provides a mechanism for a claimant or counterclaimant to unilaterally withdraw a claim after a response has been served, which furthers the statutory goal of providing a voluntary forum for the resolution of claims.17 The proposed rule also protects the interests of a responding party, who has invested time and resources into the proceeding,
and is in line with the FRCP.18 The Office welcomes comments on the advisability of including a procedure for unilaterally withdrawing a claim or counterclaim after the response has been served and whether resulting dismissals should be with or without prejudice. To the extent commenters believe that such dismissals typically should be with prejudice, the Office invites comment on whether the CCB
should be able to dismiss a case without prejudice if the circumstances show that such action is in the interests of justice.
The proposed rule also provides that a written request to withdraw a claim or counterclaim should include a brief statement signed by the party seeking dismissal. In addition, it provides that claims or counterclaims that are voluntarily withdrawn before a response is filed may be dismissed with prejudice if all parties agree in a written stipulation that is filed with the CCB.
This option is intended to facilitate early settlement negotiations. Voluntary dismissal will not impact any other claims or counterclaims in the proceeding.
3. Default and Failure To Prosecute i. Default Determinations The CCB may enter a default determination in an active proceeding where the respondent has failed to appear or has ceased participating in the proceeding. 19 The statute empowers the Office to establish additional requirements that must be met before the CCB may issue a default determination.20 The legislative history notes that the statute establishes a strong presumption against default judgments and provides greater protections against default than those available in federal court proceedings.21
The Office accordingly believes it is important to have safeguards against defaults where possible, and to ensure that parties are given adequate notice before a default can be issued.
To obtain a default determination, the claimant must still submit relevant evidence and other information in support of the claimants claim and any asserted damages, even where the respondent has failed to appear or has ceased participating.22 The CCB then will evaluate the evidence, along with any other requested submissions, and determine whether the materials provided are sufficient to support a finding in the claimants favor and, if so, 18 Fed.

14 17

U.S.C. 1506q1.
15 Id. at 1506q2.
16 Id. at 1506q12.
17 H.R. Rep. No. 116252, at 17.

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19 17

R. Civ. P. 41.
U.S.C. 1506u.

20 Id.
21 H.R.
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Rep. No.116252, at 24.
U.S.C. 1506u1.

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any appropriate relief and damages.23 If the CCB then determines that a default determination is appropriate, it must prepare the determination and provide a written notice to the respondent through all known addresses, including email addresses, and provide the respondent thirty days to file a submission in opposition to the default determination.24 The CCB must consider a timely response from the respondent, and, after allowing the other parties to address such submissions, shall maintain, or amend its proposed determination as appropriate, and the resulting determination shall not be a default determination. 25 If the respondent fails to respond to the notice, the CCB
shall proceed to issue the default determination, although the CCB may later vacate such determination in the interests of justice. 26 A federal court may also vacate the default determination if it is established that the default . . . was due to excusable neglect. 27
The Office requested comments concerning any issues that should be considered relating to a respondents default, including but not limited to regulations regarding proof of damages in default proceedings. 28 Some commenters urged the Office to adopt regulations designed to reduce the risk of the CCB becoming a default judgment mill. 29 Suggestions included regulations concerning the specific form of evidence a claimant must produce in support of a damages claim,30 or a presumption against or even a prohibition on statutory damages awards in cases of default.31 The Office is concerned, however, that regulations that increase the claimants burden in proving damages or circumscribe the kinds of damages available in the case of a default beyond what is already provided in the statute could incentivize respondents to avoid engaging with CCB proceedings due to the perception that the claimant is not likely to be able to prove or to be awarded significant damages. This could increase, not reduce, the risk that the CCB would be perceived as a default 23 Id.
24 Id.

at 1506u2.
at 1506u3.
26 Id. at 1506u4.
27 Id. at 1508c1C.
28 86 FR at 16162 citing H.R. Rep. No. 116252, at 24.
29 Authors All. Initial NOI Comments at 7; Engine Initial NOI Comments at 89.
30 AIPLA Initial NOI Comments at 7; Ben Vient Initial NOI Comments at 4.
31 Engine Initial NOI Comments at 9; Univ. of Mich. Libr. Initial NOI Comments at 3.
25 Id.

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