S T A T E O F N E W Y O R K
________________________________________________________________________
10708
I N A S S E M B L Y
September 18, 2024
___________
Introduced by COMMITTEE ON RULES -- (at request of M. of A. Vanel) --
read once and referred to the Committee on Judiciary
AN ACT to amend the general business law, in relation to prohibiting bad
faith assertions of copyright infringement
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. The general business law is amended by adding a new article
24-AA to read as follows:
ARTICLE 24-AA
BAD FAITH ASSERTIONS OF COPYRIGHT INFRINGEMENT
SECTION 370. DEFINITIONS.
370-A. BAD FAITH ASSERTIONS OF COPYRIGHT INFRINGEMENT PROHIBIT-
ED.
370-B. PENALTIES.
370-C. SEVERABILITY.
§ 370. DEFINITIONS. THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEAN-
INGS:
1. "DEMAND" OR "ASSERTION" SHALL MEAN A LETTER, E-MAIL, OR OTHER
COMMUNICATION ASSERTING OR CLAIMING THAT THE TARGET HAS ENGAGED IN COPY-
RIGHT INFRINGEMENT.
2. "TARGET" SHALL MEAN A NEW YORK RESIDENT:
(A) WHO HAS RECEIVED A DEMAND LETTER OR AGAINST WHOM AN ASSERTION OR
ALLEGATION OF COPYRIGHT INFRINGEMENT HAS BEEN MADE;
(B) WHO HAS BEEN THREATENED WITH LITIGATION OR AGAINST WHOM A LAWSUIT
HAS BEEN FILED ALLEGING COPYRIGHT INFRINGEMENT; OR
(C) WHOSE CUSTOMERS HAVE RECEIVED A DEMAND LETTER ASSERTING THAT THE
PERSON'S PRODUCT, SERVICE, OR TECHNOLOGY HAS INFRINGED ON A COPYRIGHT.
§ 370-A. BAD FAITH ASSERTIONS OF COPYRIGHT INFRINGEMENT PROHIBITED. 1.
A PERSON SHALL NOT MAKE A BAD FAITH ASSERTION OF COPYRIGHT INFRINGEMENT.
2. AN ASSERTION OF COPYRIGHT INFRINGEMENT IS PRESUMPTIVELY MADE IN BAD
FAITH WHEN:
(A) THE AMOUNT DEMANDED BY THE PERSON MAKING THE ASSERTION WAS NOT
MADE IN GOOD FAITH; OR
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD16050-03-4
A. 10708 2
(B) THE CLAIM OR ASSERTION OF COPYRIGHT INFRINGEMENT IS BASED ON COPY-
RIGHTED MATERIAL THAT IS IN THE PUBLIC DOMAIN OR FOR WHICH THE ASSERTER
LACKS THE AUTHORITY TO ENFORCE THE COPYRIGHT.
3. A COURT DETERMINING WHETHER AN AMOUNT DEMANDED WAS MADE IN GOOD
FAITH SHALL CONSIDER THE FOLLOWING FACTORS:
(A) THE AMOUNT OF THE DEMAND THAT MAKES UP THE COST OF THE COPYRIGHTED
MATERIAL;
(B) THE AMOUNT OF THE DEMAND THAT MAKES UP ANY REASONABLE COSTS AND
ATTORNEY'S FEES INCURRED IN MAKING THE ASSERTION, PROVIDED HOWEVER THAT
WHERE THE ASSERTION WAS MADE THROUGH AUTOMATED MEANS OR THE COSTS
INCURRED TO MAKE AND COMMUNICATE THE ASSERTION WERE DE MINIMIS, THE
COURT SHALL FIND THAT THE COST INCURRED IN MAKING THE ASSERTION IS ZERO
DOLLARS;
(C) THE AMOUNT OF THE DEMAND THAT MAKES UP DAMAGES RELATED TO THE USE
OF THE COPYRIGHTED MATERIAL, INCLUDING REPUTATIONAL DAMAGES, LOST
LICENSING REVENUE, LOST SALES, PUNITIVE DAMAGES AND ANY OTHER FINANCIAL
LOSS ASSOCIATED WITH THE INFRINGEMENT, PROVIDED HOWEVER THAT A COURT
SHALL ASSESS THE VERACITY OF SUCH DAMAGES AND THE AMOUNT CLAIMED BY SUCH
DAMAGES;
(D) THE AMOUNT OF THE DEMAND THAT MAKES UP ANY OTHER COSTS;
(E) THE AMOUNT THAT IS GENERALLY AWARDED FOR SIMILAR CLAIMS WHERE A
PERSON ASSERTING COPYRIGHT INFRINGEMENT PREVAILS, OTHER THAN SUCH
AMOUNTS DESCRIBED IN PARAGRAPH (B) OF THIS SUBDIVISION;
(F) THE AMOUNT THAT A WILLING BUYER OF THE RELEVANT COPYRIGHTED MATE-
RIAL IS WILLING TO PAY A WILLING SELLER. TO DETERMINE SUCH AMOUNT A
COURT MAY EXAMINE:
(I) EXISTING LISTINGS, SALES AND NEGOTIATIONS FOR SALES, WHETHER PRES-
ENTLY OR PREVIOUSLY OCCURRING;
(II) THE COST OF OTHER, SIMILAR COPYRIGHTED MATERIAL THAT THE ASSERTER
HAS LISTED, SOLD AND NEGOTIATED, WHETHER PRESENTLY OR PREVIOUSLY OCCUR-
RING; AND
(III) THE OVERALL MARKET FOR SIMILAR COPYRIGHTED MATERIALS;
(G) THE RATIO BETWEEN THE DIFFERENT CATEGORIES OF ALL AMOUNTS
ASSERTED, IN RELATION TO THE OVERALL AMOUNT OF THE DEMAND;
(H) WHETHER SUCH AMOUNTS DEMANDED FROM THE ASSERTER EVINCE AN INTENT
TO COMPEL THE RECIPIENT TO SETTLE FOR A SIGNIFICANTLY HIGHER SUM THAN
THE TYPICAL COST OF THE COPYRIGHTED MATERIAL TO AVOID THE COSTS OF LITI-
GATING A CLAIM. THE COURT MAY CONSIDER ANY RELEVANT NON-PRIVILEGED
INFORMATION IN MAKING THIS DETERMINATION; AND
(I) THE AMOUNT THAT THE ASSERTER WOULD HAVE RECOVERED OR DID RECOVER
HAD THEY BEEN SUCCESSFUL OR WHEN THEY WERE SUCCESSFUL IN AN ACTION TO
ENFORCE THE COPYRIGHTED MATERIAL, OTHER THAN SUCH AMOUNTS DESCRIBED IN
PARAGRAPH (B) OF THIS SUBDIVISION.
4. WHERE SUBDIVISION TWO OF THIS SECTION DOES NOT APPLY, A COURT MAY
CONSIDER THE FOLLOWING FACTORS AS EVIDENCE THAT A PERSON HAS MADE A BAD
FAITH ASSERTION OF COPYRIGHT INFRINGEMENT:
(A) THE DEMAND LETTER DOES NOT CONTAIN A REFERENCE TO THE COPYRIGHTED
MATERIAL AND THE NAME AND ADDRESS OF THE COPYRIGHT OWNER OR OWNERS AND
ASSIGNEE OR ASSIGNEES, IF ANY;
(B) THE DEMAND LETTER DEMANDS PAYMENT OF A LICENSE FEE OR RESPONSE
WITHIN AN UNREASONABLY SHORT PERIOD OF TIME;
(C) THE CLAIM OR ASSERTION OF COPYRIGHT INFRINGEMENT IS DECEPTIVE;
(D) THE CLAIM OR ASSERTION OF COPYRIGHT INFRINGEMENT IS MERITLESS, AND
THE PERSON KNEW, OR SHOULD HAVE KNOWN, THAT THE CLAIM OR ASSERTION IS
MERITLESS;
A. 10708 3
(E) THE PERSON OR THEIR SUBSIDIARIES OR AFFILIATES HAVE PREVIOUSLY
FILED OR THREATENED TO FILE ONE OR MORE LAWSUITS BASED ON THE SAME OR
SIMILAR CLAIM OF COPYRIGHT INFRINGEMENT, AND:
(I) THOSE THREATS OR LAWSUITS LACKED THE INFORMATION DESCRIBED IN
PARAGRAPH (A) OF THIS SUBDIVISION; OR
(II) THE PERSON ATTEMPTED TO ENFORCE THE CLAIM OF COPYRIGHT INFRINGE-
MENT IN LITIGATION, AND A COURT FOUND THE CLAIM TO BE MERITLESS; AND
(F) ANY OTHER FACTOR THE COURT FINDS RELEVANT.
5. WITH RESPECT TO A COURT'S ASSESSMENT UNDER SUBDIVISIONS THREE AND
FOUR OF THIS SECTION, A COURT MAY CONSIDER THE FOLLOWING FACTORS AS
EVIDENCE THAT A PERSON HAS NOT MADE A BAD FAITH ASSERTION OF COPYRIGHT
INFRINGEMENT:
(A) THE DEMAND LETTER CONTAINS THE INFORMATION DESCRIBED IN PARAGRAPH
(A) OF SUBDIVISION FOUR OF THIS SECTION;
(B) WHERE THE DEMAND LETTER LACKS THE INFORMATION DESCRIBED IN PARA-
GRAPH (A) OF SUBDIVISION FOUR OF THIS SECTION AND THE TARGET REQUESTS
THE INFORMATION, THE PERSON PROVIDES THE INFORMATION WITHIN A REASONABLE
PERIOD OF TIME;
(C) THE PERSON ENGAGES IN A GOOD FAITH EFFORT TO ESTABLISH THAT THE
TARGET HAS INFRINGED THE COPYRIGHT AND TO NEGOTIATE AN APPROPRIATE REME-
DY;
(D) THE PERSON IS:
(I) THE CREATOR OR AUTHOR OF THE COPYRIGHTED MATERIAL OR, IN THE CASE
OF A COPYRIGHT FILED BY AND AWARDED TO AN ASSIGNEE OF THE ORIGINAL CREA-
TOR OR AUTHOR OR JOINT CREATOR OR AUTHOR, IS THE ORIGINAL ASSIGNEE; OR
(II) AN INSTITUTION OF HIGHER EDUCATION OR A TECHNOLOGY TRANSFER
ORGANIZATION OWNED OR AFFILIATED WITH AN INSTITUTION OF HIGHER EDUCA-
TION;
(E) THE PERSON HAS DEMONSTRATED GOOD FAITH BUSINESS PRACTICES IN
PREVIOUS EFFORTS TO ENFORCE THE COPYRIGHT, OR A SUBSTANTIALLY SIMILAR
COPYRIGHT; AND
(F) ANY OTHER FACTOR THE COURT FINDS RELEVANT.
6. NOTHING IN THIS SECTION SHALL BE CONSTRUED AS LIMITING, EXPANDING
OR ALTERING ANY PARTIES' RIGHTS WITH RESPECT TO A COPYRIGHT INFRINGEMENT
CLAIM BROUGHT IN A COURT OF COMPETENT JURISDICTION.
7. THE FACT THAT A DEMAND WAS MADE THROUGH AUTOMATED MEANS, IN WHOLE
OR IN PART, SHALL NOT BE A DEFENSE TO THIS SECTION.
§ 370-B. PENALTIES. 1. A PERSON WHO IS THE RECIPIENT OF A BAD FAITH
ASSERTION OF COPYRIGHT INFRINGEMENT MAY BRING A CIVIL ACTION IN A COURT
OF COMPETENT JURISDICTION AND, UPON A FINDING THAT THE PERSON VIOLATED
THE PROVISIONS OF THIS ARTICLE, THE COURT SHALL AWARD SUCH RECIPIENT OF
A BAD FAITH ASSERTION OF COPYRIGHT INFRINGEMENT:
(A) EQUITABLE RELIEF, AS THE COURT DEEMS PROPER;
(B) REASONABLE ATTORNEY'S FEES AND COSTS;
(C) EXEMPLARY DAMAGES IN AN AMOUNT OF TEN THOUSAND DOLLARS OR THREE
TIMES THE TOTAL OF DAMAGES, COSTS, AND FEES, WHICHEVER IS GREATER; AND
(D) ANY OTHER RELIEF THE COURT DEEMS PROPER.
2. A COURT, IN ITS DISCRETION, MAY AWARD TO ANY PARTY OR ATTORNEY IN
ANY ACTION BROUGHT UNDER THIS SECTION COSTS IN THE FORM OF REIMBURSEMENT
FOR ACTUAL EXPENSES REASONABLY INCURRED AND REASONABLE ATTORNEY'S FEES,
RESULTING FROM FRIVOLOUS CONDUCT AS DEFINED IN SECTION 130-1.1 OF TITLE
TWENTY-TWO OF THE NEW YORK CODES, RULES AND REGULATIONS, AS AMENDED FROM
TIME TO TIME.
3. WHEREVER THE ATTORNEY GENERAL SHALL FIND THAT A PERSON HAS ENGAGED
IN A PERSISTENT COURSE OF CONDUCT IN VIOLATION OF THIS ARTICLE, AN
APPLICATION MAY BE MADE BY THE ATTORNEY GENERAL IN THE NAME OF THE
A. 10708 4
PEOPLE OF THE STATE OF NEW YORK TO A COURT OF JUSTICE HAVING JURISDIC-
TION TO ISSUE AN INJUNCTION, AND UPON NOTICE TO THE DEFENDANT OF NOT
LESS THAN FIVE DAYS, TO ENJOIN AND RESTRAIN THE CONTINUANCE OF SUCH
VIOLATIONS; AND IF IT SHALL APPEAR TO THE SATISFACTION OF THE COURT OR
JUSTICE, THAT THE DEFENDANT HAS, IN FACT, VIOLATED THIS SECTION AN
INJUNCTION MAY BE ISSUED BY SUCH COURT OR JUSTICE ENJOINING AND
RESTRAINING ANY FURTHER VIOLATION, WITHOUT REQUIRING PROOF THAT ANY
PERSON HAS, IN FACT, BEEN INJURED OR DAMAGED THEREBY. IN ANY SUCH
PROCEEDING, THE COURT MAY MAKE ALLOWANCES TO THE ATTORNEY GENERAL AS
PROVIDED IN PARAGRAPH SIX OF SUBDIVISION (A) OF SECTION EIGHTY-THREE
HUNDRED THREE OF THE CIVIL PRACTICE LAW AND RULES, AND DIRECT RESTITU-
TION. WHENEVER THE COURT SHALL DETERMINE THAT A VIOLATION OF THIS
SECTION HAS OCCURRED, THE COURT MAY IMPOSE A CIVIL PENALTY OF NOT MORE
THAN TEN THOUSAND DOLLARS PER BAD FAITH ASSERTION OF COPYRIGHT INFRINGE-
MENT OR THREE TIMES THE TOTAL OF DAMAGES, COSTS, AND FEES, WHICHEVER IS
GREATER. IN CONNECTION WITH ANY SUCH PROPOSED APPLICATION, THE ATTORNEY
GENERAL IS AUTHORIZED TO TAKE PROOF AND MAKE A DETERMINATION OF THE
RELEVANT FACTS AND TO ISSUE SUBPOENAS IN ACCORDANCE WITH THE CIVIL PRAC-
TICE LAW AND RULES.
§ 370-C. SEVERABILITY. IF ANY CLAUSE, SENTENCE, PARAGRAPH, SECTION OR
PART OF THIS ARTICLE SHALL BE ADJUDGED BY ANY COURT OF COMPETENT JURIS-
DICTION TO BE INVALID AND AFTER EXHAUSTION OF ALL FURTHER JUDICIAL
REVIEW, THE JUDGMENT SHALL NOT AFFECT, IMPAIR OR INVALIDATE THE REMAIN-
DER THEREOF, BUT SHALL BE CONFINED IN ITS OPERATION TO THE CLAUSE,
SENTENCE, PARAGRAPH, SECTION OR PART OF THIS ARTICLE DIRECTLY INVOLVED
IN THE CONTROVERSY IN WHICH THE JUDGMENT SHALL HAVE BEEN RENDERED.
§ 2. This act shall take effect on the one hundred eightieth day after
it shall have become a law.