The short answer – there is lots to litigate, but the Copyright Claims Board almost certainly will not be struck down for violating the Constitution’s appointments clause.
We previously wrote about three potential constitutional problems with the CASE Act. One of those problems was that it might violate the Constitution’s appointments clause. In a series of cases involving Arthrex, Inc., the Supreme Court recently decided that the appointment of administrative patent law judges who oversee patent inter partes review cases did violate the Constitution. Instead of striking the law appointing those judges down, it rewrote the statute to allow inter partes review to continue.
It is still unclear if the CASE Act is constitutional.
The appointments clause defines how government officials can be appointed or hired. What the Constitution calls “officers of the United States” must be appointed by the President with the advice and consent of the Senate. “Inferior officers” may be appointed by department heads. Following its precedent, the Arthrex Court looked at three main factors to decide whether administrative patent law judges were high officers of the United States:
- The ability to issue final decisions
- The level of oversight presidential appointees exercise over the officer
- Presidential appointees’ power to remove the officer without cause
A closely divided Supreme Court found that the patent law judges were high officers. As high officers lacking presidential appointment and Senate confirmation, their appointments were unconstitutional.
The copyright claims officers created by the CASE Act differ from administrative patent law judges because the act allows the Librarian of Congress to “sanction or remove a copyright claims officer.” Administrative patent law judges can only be removed for cause. Under Arthrex, this distinction is probably enough for the act to survive an appointments clause challenge.
However, there is a statute that says an agency may remove or discipline administrative law judges only for good cause. A proposed regulation clarifies that this statute applies to all administrative law judges. There is no definition of “administrative law judge” in the statute, and the CASE Act never calls the copyright claims officers administrative law judges. However, these officers preside over agency hearings on the record, which might make them administrative law judges subject to employment protection. If copyright claims officers can only be removed for good cause, then the appointment of the copyright claims officers under the CASE Act is probably unconstitutional.
Even if the CASE Act is unconstitutional, the Copyright Claims Board will still operate.
While the Supreme Court in Arthrex was closely divided on the constitutionality of the appointment of the administrative patent judges, seven justices agreed that the remedy was to simply make the decisions of the patent law judges reviewable by the U.S. Patent and Trademark Office director, a position appointed by the President. That is, instead of striking down the unconstitutional statute, the Supreme Court rewrote the statute to make it constitutional. While the Court did not provide much guidance on how that process should work, the USPTO adopted a policy that essentially allows any party to ask for review by the director. If the director decides to review the case, the director can then substitute his or her own judgment to ultimately decide the outcome of inter partes cases.
The Supreme Court’s remedy shows that the Court will likely avoid striking down laws as unconstitutional when they can be easily fixed to comply with the Constitution’s limits under the appointments clause. However, the case also shows the Court has its own understanding of how to best rewrite laws, which may not match with lower courts. For instance, in Arthrex, the D.C. Circuit found the statute unconstitutional. The circuit court rewrote the statute to allow the administrative patent law judges to be fired without cause. The Supreme Court rejected that rewrite and substituted its own. That decision may lead lower courts to rewrite statutes to give final decision-making authority to presidential appointees, instead of removing civil service protections from administrative law judges.
Arthrex creates as many questions as it answers.
Previously, we knew there was an open question about whether the CASE Act complied with the appointments clause. That question remains. If the act does violate the appointments clause, many new questions have been raised.
Can the Librarian of Congress, the presidential appointee that oversees the copyright office, review all CASE Act decisions? The CASE Act says no. But can the Board itself or the Librarian decide that the act violates the appointments clause and simply rewrite the act consistent with Arthrex?
All these questions mean that defendants in front of the Board should be objecting to the appointment of the copyright claims officers and reserving their potential right to have any decision reviewed by the Librarian of Congress.