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Federal Register / Vol. 86, No. 233 / Wednesday, December 8, 2021 / Proposed Rules
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appropriate and effective methods for preventing abuse of the default process.
ii. Failure To Prosecute The statute establishes a procedure whereby proceedings may be dismissed due to the failure of a claimant to complete service or to otherwise participate in the proceeding. Under the statute, the CCB will dismiss a respondent or an entire proceeding, as is applicable, without prejudice where a claimant does not complete service on one or more respondents within ninety days of the CCB approving the claim.35
Once a proceeding becomes active, if a claimant including a counterclaimant fails to meet one or more deadlines or requirements set forth in the CCBs scheduling order without justifiable cause, the CCB may dismiss the claims after providing the claimant with written notice and a thirty-day period to respond and cure the missed deadline.36
If the claimant does not comply, the CCB, after considering any response the claimant provides other than actually complying with the requirements of the missed deadline, may dismiss the claims.37 As with default determinations, the CCB may subsequently vacate a dismissal in the interests of justice, 38 and a federal court may vacate the determination if it is established that the default or failure was due to excusable neglect. 39
The Office solicited comments concerning regulations governing a claimants failure to prosecute its claims. One commenter suggested that the regulations permit a respondent to move for dismissal for failure to prosecute,40 while others opposed such a regulation.41
The proposed rule concerning a claimants failure to complete service creates a distinction between necessary parties and non-necessary parties. If a claimant fails to timely serve a respondent whose participation is not necessary to adjudicate the claims against other parties, the CCB will dismiss that respondent from the proceeding without prejudice, and the proceeding will continue against any remaining respondents. On the other hand, if a claimant fails to timely serve a respondent who is a necessary party, the CCB will dismiss the proceeding without prejudice. If the claimant does not timely serve each and every 35 17
36 Id.

U.S.C. 1506v1.
at 1506v2.

37 Id.
38 Id.
39 Id.

at 1508c1C.
Initial NOI Comments at 8.
41 Copyright Alliance, et al. Reply NOI Comments at 1617.
40 Amazon
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respondent, the CCB will dismiss the proceeding without prejudice.
The proposed rule pertaining to a claimants failure to prosecute generally mirrors the provisions regarding a respondents default. Under the proposed rule, at the request of a party or on its own initiative, the CCB may issue a notice to the claimant, which will be delivered by mail and to all known email addresses for the claimant, that failure to prosecute may result in the CCB issuing a determination dismissing the claimants claims. This notice will explain the legal effects of such a determination and provide the claimant with thirty days to cure the missed deadline or requirement. If the claimant has not re-engaged fifteen days into this thirty-day window, the CCB
will send a second notice to the claimant that re-attaches the first notice and reminds the claimant that it must cure the missed deadline or requirement by the thirty-day deadline.
If the claimant cures the missed deadline or requirement within the thirty-day window, the proceeding will resume and the CCB will issue a revised scheduling order, if necessary. If the claimant fails to cure the missed deadline but otherwise responds with an indication of an intent to re-engage in the proceeding, the CCB will consider the response and may either provide the claimant with additional time to cure the missed deadline or requirement, or may proceed with issuing a determination dismissing the claims. If the claimant fails to cure the missed deadline or requirement within the thirty-day window and does not otherwise request and receive additional time to cure the missed deadline, the CCB will issue a determination dismissing the claims. Such a dismissal will be with prejudice and may include an award of attorneys fees and costs, if appropriate. As with a default determination, the claimant may challenge the determination in federal court within ninety days of its issuance or, provided that it has not yet initiated proceedings in federal court, may submit a request to the CCB that the determination be vacated. The respondent will have an opportunity to respond to this request, and both parties will follow the general procedures for reconsideration requests with respect to their submissions. The CCB may then vacate the determination in the interests of justice.
The Office welcomes any comments concerning the proposed rules concerning a claimants failure to proceed and specifically, whether they strike the proper balance between the
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rights and interests of a respondent and a claimant.
4. Conduct of Parties The statute contains several provisions that are designed to deter and address improper conduct from parties in proceedings before the CCB.
These include provisions authorizing the CCB to penalize bad-faith conduct by awarding costs and attorneys fees, and to bar repeat bad-faith actors from initiating proceedings before the CCB
for a period of twelve months.42
i. Bad-Faith Conduct Under the statute, the CCB may award reasonable costs and attorneys fees where it determines that a party pursued a claim, counterclaim, or defense for a harassing or other improper purpose, or without a reasonable basis in law or fact, . . .
unless inconsistent with the interests of justice. 43 Such an award is typically limited to $5,000, but where the party appeared pro se, the award may only include costs and is capped at $2,500.44
The award may be increased beyond the statutory limit in extraordinary circumstances where there is a demonstrated pattern or practice of bad faith conduct. 45 The statute also authorizes the CCB to bar a party from initiating claims for a period of twelve months if it determines that the party engaged in certain bad-faith conduct more than once in a twelve-month period.46 If it reaches such a determination, the CCB must also dismiss without prejudice any pending proceedings that were commenced by the bad-faith actor, except that dismissal of any active proceeding requires the written consent of the respondent.47
In response to the NOI, commenters suggested that the Office create a streamlined process or standardized forms to report bad-faith conduct 48 and publish a list of bad-faith actors who have been barred from using the CCB.49
Commenters also recommended that the Office establish rules preventing copyright trolls from abusing the 42 17

U.S.C. 1506y2.

43 Id.
44 Id.

at 1506y2A.
at 1506y2B.
46 Id. at 1506y3.
47 Id.
48 Amazon Reply NOI Comments at 4; Amazon Initial NOI Comments at 1112; Copyright Alliance, et al. Initial NOI Comments at 42.
49 Copyright Alliance, et al. Reply NOI Comments at 20; Comput. & Commss Indus. Assoc. & internet Assoc. CCIA & IA Initial NOI Comments at 7
8.
45 Id.

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