In Brief:  The US Copyright cannot demand the deposit of a physical copy of a work for registration.

Here’s What Happened:  

Valancourt Books LLC is an independent small press based in Richmond, Virginia, specializing in new editions of neglected classics, with an emphasis on horror/supernatural and LGBT literature. (Some of its offerings appear in the included graphic). Valancourt doesn’t keep an inventory of physical books it publishes.

In June 2018, the US Copyright Office sent a letter to Valancourt demanding that it submit physical copies of its published books pursuant to Section 407 of the Copyright Act or be subject to fines. Section 407 of the Copyright Act requires the deposit of a work within 3 months after the date of publication. There is no deposit requirement for unpublished works. Section 407 also provides for the Copyright Office’s ability to demand a deposit and to impose a fine if the owner does not. The section also gives the Copyright Office the ability to waive or modify the deposit requirement.

Valancourt responded to the Copyright Office’s demand letter that the fines were onerous considering the number of works involved and that some of the works were in the public domain. 

The Copyright Office offered to give Valancourt special relief from the fines. Valancourt rejected the Copyright Office's offer for two reasons. First, Valancourt objected to the idea that it would receive special treatment while other small publishers would continue to be subject to Section 407's mandatory deposit requirement. Second, it did not believe it could comply with the offer because it likely lost electronic copies of at least some of its works in part due to a home burglary.

Valancourt brought suit against the Copyright Office arguing that Section 407, as applied by the Copyright Office, worked as an unconstitutional taking of Valancourt’s property which violates the Takings Clause of the Fifth Amendment. Valancourt noted that the deposit requirement is not a condition to obtaining a copyright registration. So the demand to submit a physical copy of a work isn’t justified. The Copyright Office offered a somewhat sardonic solution to the problem if Valancourt would simply disavow copyright protection. The district court entered summary judgment for the Copyright Office.

On appeal to the Federal Circuit, the court discussed the reason for copyright law. The focus of the law is to protect the rights of creators of original works of authorship. The Copyright Act gives creators exclusive rights for a period of time. The rights begin when the work is fixed in a tangible means of expression. The Copyright Act provides no further requirements to copyright protection. Turning to the Takings Clause of the Fifth Amendment, the court stated that it is not violated if the demand for person property (i.e. physical copies or the fines) involves an exchange for a governmental benefit. The property owner would be aware of the conditions of the exchange before payment. Here, the copyright owner doesn’t get an additional benefit for complying with the deposit requirement. Registration of the copyright is a precondition to bringing suit and prima facie evidence of ownership. But registration doesn’t confer any additional benefits. The court described the mandatory deposit requirement as a burden without any benefit. Therefore, the court determined that Section 407 violates the Takings Clause of the Fifth Amendment.

The Federal Circuit reversed the judgment.

Why You Should Know This: Valancourt’s cogent arguments were a matter of first impression. Many copyright owners comply with the deposit requirement without a second thought. This demonstrates why it’s always a good idea to the look at all aspects of a problem; even aspects that have never been pursued before.

Case Information: Valancourt Books, LLC v. Garland, __ 4th __ (2023 WL 5536195) (Fed. Circ. 2023).

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