Deposit Battle: The Deposit Requirement for Publishers Under Copyright Law Is Ruled (Somewhat) Unconstitutional

depositbattle_dburton"Vestigial structure" is defined as "a structure in an organism that has lost all or most of its original function in the course of evolution, such as human appendixes." (Source:  The scientific term seems apt for the longstanding requirement under U.S. copyright law that publishers of a work deposit two physical copies of that work with the Library of Congress.  Recently, in Valancourt Books, LLC v. Garland, No. 21-5203, 2023 U.S. App. LEXIS 22715 (D.C. Cir. Aug. 29, 2023), the D.C. Court of Appeals ruled that the deposit requirement of 17 U.S.C § 407, as currently applied, violates the Takings Clause of the Fifth Amendment.  However, the court stopped short of performing a total deposit requirement-ectomy.  While the court seemed sympathetic to a view that, due to statutory amendments that have eliminated procedural hurdles to copyright protection, the deposit requirement has become a relic, the court nevertheless went out of its way to limit its ruling to the facts of the particular case, as explained below.

The deposit requirement has existed from the beginning of U.S. copyright law in 1790.  Valancourt at *21. An 1870 Act extensively revising U.S. patent and copyright law specified that two copies of publications must be deposited with the Library of Congress, a change "encourage[d]" by the then-Librarian of Congress, who wanted to "us[e] the deposit copies of registered works to help build the Library's collection."  ("History of U.S. Copyright Office").  In 1897, Congress established the Copyright Office as a department within the Library of Congress (where it remains today).

Importantly, prior to 1976, "the benefits of copyright were intimately tied to mandatory deposit, and authors had to deposit works to either obtain or maintain copyright and its related benefits."  Valancourt at *21.

Beginning, though, with the Copyright Act of 1976, Congress removed many of the formal requirements for invoking copyright protection.  For instance, the 1976 Act, consistent with international norms expressed in the Berne Convention of 1886, established that U.S. copyright begins at the time the work is created. 17 U.S.C. § 302(a) ("Copyright in a work created on or after January 1, 1978, subsists from its creation ….").  The previously governing copyright law, the 1909 Act, provided that copyright did not begin until publication, or, for unpublished works, until registration with the Copyright Office.  Also, in the 1976 Act, Congress removed the requirement of filing for renewal of copyright for works published after 1977, and later (in 1992) extended that exemption from the renewal requirement to works copyrighted after 1963.  17 U.S.C. § 304(a); Public Law 102-307, § 102(g).  Then, in 1989, Congress removed the requirement that publishers put the copyright notice (the © symbol) on a work to obtain copyright protection, making it optional. 17 U.S.C. § 401 (changing the word "shall" to "may").

For present purposes, the significance of the 1976 Act is that it also removed mandatory deposit as a prerequisite to copyright. Pursuant to the Act, 17 U.S.C. § 407(a) states "[n]either the deposit requirements … nor the acquisition requirements [for unpublished work] … are conditions of copyright protection."

Somehow, however, the requirement for publishers to deposit two copies of a work survives, despite copyright being no longer tethered to the requirement; despite the rise of the Internet as an available repository for digital copies of books; and despite the trend of the Copyright Office watering down the requirement.  As to the latter point, for "most literary works" the Office only requires one copy although it "reserves the right to request a second copy." Valancourt at *6.  Further, a copyright owner may ask for "special relief" from compliance with § 407.  Id.  Moreover, in Valancourt, the Copyright Office offered, as a mid-litigation settlement proposal for that particular case, to accept electronic copies. Id. at *9-10.  Nevertheless, the requirement of depositing a physical copy still exists, and failure to comply is punishable by a fine of $250 for each work, or $2,500 for willful noncompliance.  17 U.S.C. § 407(d).

Surprisingly, after the 1976 amendments, the deposit requirement went unchallenged for four decades, until 2018, when Valancourt Books, an "independent press," complained that the demand to deposit physical copies of its books was too costly (over $2,500), and that much of what it published was in the public domain (i.e., not protected by copyright) anyway. Valancourt at *2, 7-8.  The company sued, arguing that the requirement was unconstitutional under both the Free Speech Clause of the First Amendment and the Takings Clause of the Fifth Amendment.  Id. at *9.

Valancourt lost in the trial court and appealed to the D.C. Circuit Court of Appeals.  There, a three-judge panel ruled in favor of Valancourt on the Takings Clause challenge.  The court considered the First Amendment issue mooted by the ruling on the Takings Clause, and therefore did not address it.  Id. at *15-16.

The court without hesitation deemed the requirement "a 'classic taking in which the government directly appropriates private property for its own use." ' Valancourt at *16 (citation omitted).  It also noted that it is well-established that a fine imposed in lieu of surrendering one's property does not save a law from effecting a "taking" for purposes of analysis under the Fifth Amendment.  Id. at *24-25.

The taking violates the Fifth Amendment because it is an uncompensated taking, with the publisher receiving no benefit for depositing copies.  "[T]he government cites the many benefits that copyright confers upon authors.  But authors obtain those benefits upon fixation [i.e., creation of a work in a tangible medium], and mandatory deposit grants no additional benefits."  Valancourt at *19-20.  Even owing fines for refusing to deposit the required copies does not affect the copyright, which remains with the owner.  Id. at *19.  The implied bargain - - you give us books, we'll give you the copyright in those books -- has disappeared, due to the elimination of deposit as a prerequisite to copyright ownership.  The deposit requirement serves no purpose now except building the Library of Congress' physical collection.  It is "a burden untethered to any benefit."  Id. at *21.

The Court distinguished the entirely separate deposit requirement of 17 U.S.C. § 408, the section governing copyright registration.  Valencourt at *20.  Registration *does* confer benefits: it is prima facie evidence of validity of the copyright (17 U.S.C. § 410(c)) and it provides access to the federal courts for the copyright owner, since registration is a prerequisite to filing a copyright infringement suit (17 U.S.C. § 412).  

The Court's opinion was straightforward up to that point.  However, the opinion then took (in my view) a strange turn in discussing the government's argument that "a copyright owner can readily disavow copyright protection and thereby avoid the deposit requirement."  Valencourt at *25.  The Court mused that, "[i]f there were a simple, seamless, and transparent way to opt out of copyright protection, perhaps mandatory deposit would fall outside the realm of the Takings Clause because any forfeiture of property might arguably be voluntary."  Id.  I do not follow how surrendering a property right – one that has value – on the pain of paying a fine is less of a taking or somehow "voluntary."

Ultimately, the court concluded that the the surrender option is unrealistic because there is no mechanism in place under current law to disavow copyright protection on a work easily.  Valencourt at *26-35.  Nevertheless, the court declared that its decision under the Takings Clause is "tied to the particular circumstances," which include the fact that the Copyright Office issued a demand letter "indicating no option other than surrendering the property at issue or paying a fine, and in which Valancourt had no indication from any other source of the existence of a costless option to disavow copyright protection and thereby avoid complying with the sole options described in the demand letter."  Id. at *36.  "We leave it to the district court and the parties to fashion relief commensurate with the parameters of our resolution."  Id.  One would think that the relief would be not having to pay the unconstitutional fine, but the vagueness of the court's direction raises doubts.  Along with the "particular circumstances" comment and the discussion of disavowing copyright, the court might consider the Constitution complied with by a letter from the Copyright Office to copyright owners explaining how to surrender their copyright protection "voluntarily."  At any rate, it appears that the requirement of a physical deposit of a copyright work will not be the relegated to the dustbin of history just yet.

About The Author

Don Burton | Faruki Attorney