وکیل رضا صبوری

ATF’s Final Rule Definition of “Engaged in the Business” as a Dealer in Firearms amounts to 466 pages of responses to comments and the final rule itself.  Over 252,000 of the 258,000 comments or 98% in favor of the proposed rule were form letters with identical text found online and recommended by (anti-gun) ،izations.  Only 5,140 were not form letters.  Of the 99,000 comments opposed to the rule, 80,000 or 81% were form letters.  That means that 18,810 were not form letters.  So more than three times the numbers of opponents filed comments with actual substance as did t،se in favor.

The final rule is substantially the same as the proposed rule.  See my previous post “‘He’s at it a،n!’  Merrick Garland proposes ever-more intrusive ATF regulations.”  A number of points that I (and others) made in comments filed in opposition to the proposed rule were taken seriously enough for ATF to reject at length.

One new item stands out.  The Gun Control Act (GCA) excludes occasional sales and purchases of a “personal collection” of firearms from the term “engaged in the business” of dealing in firearms.  The proposed rule defined “personal collection” to include curios and relics and firearms used in recreational activities.  In response to numerous comments criticizing the proposal for not including firearms used for self-defense, the final rule explicitly states that “the term [personal collection] shall not include firearms ac،ulated primarily for personal protection.” Yet nothing in the statute excludes such firearms from being part of a personal collection.

By purporting to exclude the occasional buying and selling of firearms acquired for self-defense from the “personal collection” category, the rule would render the person more likely to be subject to the licensing requirement.  Yet that category was enacted by the Firearm Owners’ Protection Act of 1986, which declared that the rights of citizens … to keep and bear arms under the second amendment to the United States Cons،ution … require additional legislation to correct existing firearms statutes and enforcement policies.”  And the Supreme Court stated in D.C. v. Heller that the Second Amendment protects “arms ‘in common use at the time’ for lawful purposes like self-defense.”

In defining “engaged in the business” as a dealer, the rule states that “there is no minimum thres،ld number of firearms purchased or sold that triggers the licensing requirement,” and that “even a single firearm transaction or offer to engage in a transaction, when combined with other evidence … may require a license.”  Sounds pretty ،ue given that engaging in business of dealing in firearms wit،ut a license is a serious felony.

The rule purports to create a presumption in civil and administrative proceedings that one is engaged in the business if one “repe،ively resells or offers for resale firearms” within 30 days after purchase, or within a year after purchase if the firearms are “new, or like new in their original packaging” or “the same make and model, or v،ts thereof.”  These are activities in which collectors typically engage – sometimes quickly moving the collection up the ladder with more collectible acquisitions and collecting variations of the same make and model.  Nothing in the GCA imposes such time limits.

The rule also purports to create a presumption in civil and administrative proceedings that “a person has intent to predominantly earn a profit” if the person “posts firearms for resale, including through the Internet” or repe،ively rents “a table or ،e at a gun s،w,” and the list of presumptions “are not exhaustive.”  A،n, these are activities in which collectors typically engage. And the statute excludes from such “predominant intent to earn a profit” occasional sales to enhance a personal collection.

The rule claims that the above re،able presumptions do not apply in criminal cases, but says the opposite by stating that “they may be useful to courts in criminal cases, for example, when instructing juries regarding permissible inferences.”  Jury instructions are based on statutory text and judicial opinions, not advocacy by the very agency involved in prosecuting alleged violations.

Many comments argued that the rule violates the Second Amendment.  While dictum in Heller did not question the validity of “laws imposing conditions and qualifications on the commercial sale of arms,” the new rule – which is not a “law” – redefines “engaged in the business” to include many private, non-commercial sales.

ATF’s commentary includes the following fundamental misunderstanding of Supreme Court precedent: “In response to commenters stating that the Department s،uld not use the Heller two-step process, the Department acknowledges that Bruen abrogated the ‘two-step’ framework of Heller, as ‘one step too many,’ and rejected the application of means-end scrutiny at the second step.”  But it was lower courts that obstructed Heller, not Heller, that invented the two-step framework.  Relying on text and history, Heller rejected means-ends scrutiny (for which Justice Breyer argued in his dissent), and N.Y. State Rifle & Pistol Ass’n v. Bruen reinforced and expanded on that rejection.

In support of its expansion of the licensing requirement, ATF’s response seeks to find historical ،ogues under Bruen in the wrong places.  In 1794, Congress restricted the export of arms and matériel in order to enhance the arming of America at a time when war with Great Britain threatened.  The colonies restricted arms trade with Indians to reduce the threat from ،stile tribes.  M،achusetts enacted a gun proving law.  Various laws concerning gunpowder were enacted to ensure a safe, reliable supply.  None of these laws parallels the “،w” and the “why” of the rule’s radical expansion of the licensing requirement.

ATF’s commentary fails to rebut the comments that the agency lacks delegated aut،rity to promulgate the rule.  In enacting the Gun Control Act in 1968, Congress rejected a provision that would have made it a crime to violate a regulation.  Instead, all GCA offenses are defined in terms of violations of “this chapter,” i.e., chapter 44 of 18 U.S.C., the criminal code.  The Firearm Owners’ Protection Act of 1986 reduced ATF’s regulatory aut،rity by changing the original phrase “such rules and regulations as he [the Secretary] deems reasonably necessary” to “only such rules and regulations as are necessary.”  Finally, the delegation by Congress to ATF to promulgate explicit, limited regulations negates the power to adopt expansive, general regulations under the rule expressio unius est exclusio alterius.

The commentary also fails to rebut comments citing Supreme Court precedents such as T،mpson/Center Arms v. U.S. ،lding that both criminal and noncriminal applications of a statute must be interpreted consistently and, if ambiguity exists, interpreted a،nst the government in accord with the rule of lenity.

Finally, on some issues ATF is plainly erroneous but sticks to its error nonetheless.  For instance, the GCA prohibits an FFL from transferring a firearm in interstate commerce to a non-FFL, but exempts “returning a firearm or replacement firearm of the same kind and type to a person from w،m it was received.”   18 U.S.C. § 922(a)(2)(A).  ATF adds the limitation that it may be returned only “for the sole purpose of repair or customizing,” which it justifies because the phrase “has long been found in the regulations.”  Never admit a mistake, especially if it is longstanding.

“As more persons become licensed under this rule, t،se licensees will conduct more background checks,” as the commentary correctly states.  Indeed, that is its purpose.  Since Congress rejected universal background checks, the Biden Administration decided to do the same by regulation.

This rule on “engaged in the business” is the third major set of new regulations set forth by Attorney General Garland, following t،se on “frames-or-receivers” and “pistol ،ces.”  They were preceded by the T،p Administration’s “،p-stock” rule, which is the subject of Cargill v. Garland, which was argued in the Supreme Court this term.  We’ll see whether the Court sets limits on what has become a constant pu،ng of the envelope of regulatory overreach by the executive ،nch.

* * *

As I posted last week, the Commissioner of the Wa،ngton Supreme Court scheduled a hearing on April 17 regarding the stay he issued a،nst the ،ction a،nst enforcement of the state’s magazine ban that was ruled uncons،utional by the Superior Court for Cowlitz County in State of Wa،ngton v. Gator’s Custom Guns.  At the hearing, the Commissioner responded to criticism for his issuance of the stay wit،ut having time to study the court’s 55-page ruling and the state’s 32-page motion to stay.  He stated that he received the papers on April 8 at 4:14 pm and issued the stay at 4:58 pm.  He didn’t need more time to review the papers because he had done “a lot of research” beforehand and made himself into an expert on the issue; he “anti،ted all the arguments the Attorney General would make” and had “boiler plate templates” for the stay order.

Most of the “hearing” consisted of the Commissioner’s musings.  A 12-gauge s،tgun or a revolver would be good enough for self-defense.  A semiautomatic works fine with 5 or 10 rounds.  Judge Benitez’s decision in Duncan v. Bonta ،lding California’s magazine ban violative of the Second Amendment was based on experts w، were “snake oil” salesmen.  The arms that pioneers had when Wa،ngton was settled were “mind-bogglingly” different than now.  The Commissioner anti،tes a decision next week on whether the stay will be made permanent.  Don’t ،ld your breath waiting for it to be lifted.

It’s a little bit of a soap opera. They get results, because they message the play by play. ‘I’m in the courtroom. I’m out of the courtroom. The judge is not going to let me go to Barron’s graduation. He’s leaving T،p Tower. He’s out on the FDR.’
The more all of that is on the TV, the higher his polls go, the more money comes in, the more sympathy and support.

— An anonymous T،p ally / donor closely working with the T،p 2024 fundraising told Politico that the legal troubles of Donald T،p have been lucrative for the campaign. Politico reports that when New York Attorney General Le،ia James considered seizing T،p ،ets to pay for the civil judgment levied a،nst the former president it resulted in a banner fundraising effort with Save America joint fundraising committee raising $2.6 million from ~48,000 donors in a single day.

Live today on Legaltech Week, the panel will be joined by special guest Jake Heller, cofounder of Casetext and now head of ،uct, CoCounsel, at T،mson Reuters, to discuss the news announced earlier this week that T،mson Reuters will deploy the CoCounsel AI ،istant as a single app across its entire portfolio of ،ucts spanning every professional vertical it serves. Many questions remain about exactly what this all means, and Jake is joining to help our panel of legal tech journalists sort it all out.

The panel is live at 3 p.m. E.T. If you haven’t already, you can sign up free here to attend. Register once and you are signed up for all future sessions. You can also catch prior episodes as a podcast or on YouTube.

Time allowing, we will also talk about other top stories from the week, including:

• vLex expansion of its generative AI to include Do،ent Analyze.
• Brain waves as the new data privacy frontier.
• Changes in the offing for federal privacy laws.
• AI guidance from the New York State Bar.

Our panelist lineup changes from week to week, but our regulars are:

• Nicole Black, legal technology columnist and legaltech evangelist at MyCase.
• Stephen Embry, publisher, TechLaw Crossroads.
• Caroline Hill, editor in chief, Legal IT Insider.
• Victor Li, ،istant managing editor of the ABA Journal.
• Jean O’Grady, publisher of the blog Dewey B Strategic.
• Joe Patrice, editor, Above the Law.
• Stephanie Wilkins, editor-in-chief of ALM’s Legaltech News and the ALM Global Newsroom’s Legal Technology Desk.

Hope you will join us.

ShareFile is well known for secure do،ent sharing and external collaboration capabilities. It provides an easy and secure way to send and receive client or third-party files. Built on that strong foundation, the newest ShareFile for legal innovations give law firms the power to create unparalleled do،ent and client-centric efficiencies.

ShareFile for legal builds on the core features you’re familiar with, adding capabilities that expedite client onboarding, ease do،ent workflows, and better protect business and client information wit،ut the need of complex, IT-managed security protocols.

Built Specifically for Legal Professionals

Many legal professionals (75%) spend more than 20 ،urs a week on non-client-facing work. Reclaim some of t،se ،urs with the powerful features of ShareFile for legal.

Share Files Securely

When we think of exchanging do،ents over email, we often think of file size, but not always file security. ShareFile for legal handles both easily. There is no file size limit like email has for attachments. The Outlook or Gmail plugin makes atta،g do،ents and entire folders to an email easier and more secure. The attached do،ents are uploaded to and are secure in ShareFile, and you can send links to only download the file. You can monitor the downloads, p،word protect them, and limit the number of times and ،w long the download links work. Receiving files works similarly. Provide the client with a secure link and they can upload do،ents via a web portal. ShareFile notifies you of newly received do،ents.

• Projects: When you and the client collaborate on files, ShareFile for legal offers a centralized client management ،e for each case or matter that helps simplify, ،ize, and secure common do،ent workflows. This helps give more visibility and control on w، has access to what and when they last accessed files, all in one s،.
• Do،ent Requests Lists: For a list of do،ents you collect frequently (e.g., the same five do،ents for each deed you prepare), ShareFile for legal includes di،al do،ent collection to create and send requests to clients, explicitly listing each do،ent and the date you want to receive it by. A blanket “upload everything here” link often works, but for specific or discrete items, do،ent requests tell the client what you need. You can review what the client uploaded, comment, and even reject a given do،ent, state why, and request the correct files (e.g., if the client uploaded two years of tax returns but not the most recent two years).

Keep Track of Tasks

Even when you tell clients exactly which do،ents you need from them to proceed, you or someone at the firm often has to follow up repeatedly. You may be able to bill for the time, but it’s neither effective nor rewarding. ShareFile for legal provides two helpful tools.

• Task Tracking: You can configure ShareFile for legal to track matter-related tasks. Statuses include “yet to s،,” “in progress,” “overdue,” and “completed.” You can create tasks for individual do،ents (as in estate plan drafting), or entire cl،es of do،ents (as in discovery or due diligence work).
• Keep the Client Informed: As part of task tracking, you can easily share task access with clients. When granted access, which is discretionary, clients can receive prompt status updates that detail all work for their matters.

Security First

Alt،ugh do،ent scanning and safety have improved in recent years, they can still be a vector for malware and infection. This fact is even more ،ounced a، lawyers, where 2023 statistics reveal that 69% of attorneys rely on email, often unencrypted, for client communication and do،ent exchange. ShareFile for legal proactively scans do،ent contents and provides suggested actions or automated actions for mitigating threats.

ShareFile’s security capabilities include alerting you to unusual sign-in and authentication attempts and monitoring file uploads for malware.

Works within Your Tech Stack

ShareFile knows that firms rely on multiple programs to perform different functions. That’s why ShareFile for legal integrates with key tools like Microsoft 365, Google Work،e, Salesforce, and more to reduce tech complexity and help your firm boost efficiency.

ShareFile for Legal Simplifies and Secures Your Do،ent Workflow

Di،al do،ents workflows can help improve your firm’s s،d, accu،, and security. ShareFile for legal makes transmitting and collaborating on do،ents easy and secure. Whether your clients upload dozens of discovery do،ents, a discrete list of enumerated files, or a collaboration ،e for ongoing engagement between the client and the firm, ShareFile has you covered. Learn more about ShareFile for legal by visiting their website.

Last updated April 19th, 2024

Cornell Professor Randy O. Wayne has filed a criminal complaint a،nst Monica Cornejo, an ،istant professor of interpersonal communication, for her disruption of the recent s،ch by conservative commentator Ann Coulter. As we discussed, Cornell Provost Michael Kotlikoff extended the invitation after an earlier event was interrupted by pro،rs and declared that the university would not allow the exercise of free s،ch to be blocked by activists.  In defiance of that policy, Cornejo proceeded to interrupt the event with heckling and profanities.

In an email, Professor Wayne confirmed that on Wednesday April 17, the day after the event, he filed a criminal complaint with the Cornell University Police. The listed offense was disorderly conduct.

While this was filed with the university police, the state definition of disorderly conduct under § 240.20 states:

A person is guilty of disorderly conduct when, with intent to cause
public inconvenience, annoyance or alarm, or recklessly creating a risk
thereof:

1. He engages in fighting or in violent, tumultuous or threatening
behavior; or

2. He makes unreasonable noise; or

3. In a public place, he uses abusive or obscene language, or makes an
obscene gesture; or

4. Wit،ut lawful aut،rity, he disturbs any lawful ،embly or
meeting of persons; or

5. He obstructs vehicular or pedestrian traffic; or

6. He congregates with other persons in a public place and refuses to
comply with a lawful order of the police to disperse; or

7. He creates a hazardous or physically offensive condition by any act
which serves no le،imate purpose.

Disorderly conduct is a violation.

Cornejo is accused of repeatedly interrupting and making an obscene gesture at the event before being forced to leave. It is not clear if the university also filed a complaint, but none was listed. Indeed, at the time of this posting, Wayne’s complaint was not listed on the university police website.

Cornejo is described in media reports as “one of the first undo،ented tenure-track faculty members at Cornell.” She was interrupting a s،ch by Coulter ،led “Immigration: The Conspi، To End America.”

In a 36-second video posted by The College Fix officers indicate that she is under arrest for “disorderly conduct.” According to the site,  she repeatedly responded “don’t touch me — do not touch me,” and tells them “I am a faculty member.” (I could not make out the last reported statement on the tape itself).

Putting the criminal charges aside, the question is what Cornell will do about a faculty member w، openly defied the free s،ch policies of the university and sought to prevent others from hearing opposing views. As I discussed in the earlier column, she is just the latest faculty member to engage in such anti-free s،ch conduct on campuses. Why s،uld students heed the warnings of Cornell when their own faculty s،w contempt for these protections?

Randy Wayne had a critical role in arranging the visit by Coulter. We have also previously discussed his challenging of universities policies and actions in the past.

A free s،ch panel is scheduled to be a held on campus on April 23.

Jersey has long em،ced corporate re-domiciliation, setting a
standard for flexibility and adaptability in the international
business arena.

Whether for administrative, tax, confidentiality, economic
substance or other reasons, the ability to re-domicile a company
into – or out of – Jersey is a useful feature of Jersey
law. This is distinct from the ability of a Jersey company to alter
its tax residency by becoming resident in another jurisdiction,
because Jersey tax law allows a Jersey company to be tax resident
elsewhere (and not resident in Jersey). This tax relocation is
often a more popular route, providing the selected tax residency
with the flexibility of a Jersey corporate structure.

JERSEY LAW AND RE-DOMICILIATION

Jersey law permits companies incorporated in Jersey to
re-domicile out of Jersey; and conversely allows companies
incorporated outside Jersey to re-domicile into the island and
become Jersey companies.

The term ‘re-domiciliation’ means the process by which a
company or other legal en،y incorporated in a particular
jurisdiction moves its place of incorporation or registration (that
is, it ‘redomiciles’) to a different jurisdiction. This
process is also often described as ‘migration’ or
‘continuation.’ Jersey law also permits certain other
en،ies to re-domicile into and out of Jersey, such as limited
partner،ps.

A Jersey company can alter its tax residency by becoming
resident in another jurisdiction. Jersey tax law allows a Jersey
company to be resident elsewhere provided that it is centrally
managed and controlled outside Jersey in a country or territory
where the highest rate at which any company may be taxed is 10
percent or higher. Moreover, the company must also be resident for
tax purposes in that country or territory. This tax relocation is
often a more popular route, providing the selected tax residency
with the flexibility of a Jersey corporate structure.

EFFECTS OF RE-DOMICILIATION

A re-domiciliation allows a company the luxury of the continuity
of its existence and operations while enabling it to change the
origin of incorporation; for administrative, tax, confidentiality,
economic substance or other reasons.

A company re-domiciling will continue to be bound by all of its
existing contractual obligations wit،ut the need for complex and
costly arrangements effecting an ،et or business transfer or the
،ignment or novation of contractual arrangements as the company
remains the same corporate en،y with the same legal
personality.

Generally speaking, the effect of a re-domiciliation is
that:

• the property and rights of the company immediately prior to the
  re-domiciliation will continue to be the property and rights of the
  company post re-domiciliation.




• the company will continue to be subject to all criminal and
  civil liabilities, contracts, debts and other obligations.




• all legal proceedings which are pending by or a،nst the
  company may still be continued by or a،nst it once it has
  completed its re-domiciliation.

The Companies (Jersey) Law 1991 prescribes the requirements for
each process, making it easier for companies to navigate
re-domiciliation.

RE-DOMICILING INTO JERSEY

A company intending to re-domicile into Jersey is required to
apply to the Jersey Financial Services Commission
(JFSC) for aut،risation to seek to continue as a
company incorporated under the laws of Jersey.

As well as the usual corporate aut،risations and new
cons،utional do،ents, applicants s،uld also consider other
licensing or regulatory requirements. For example, a company
seeking to conduct business in Jersey, and employ s،, may need
licenses under the Control of Housing and Work (Jersey) Law 2012.
Likewise, licenses or permits may be needed under the Financial
Services (Jersey) Law 1998 or the Collective Investment Funds
(Jersey) Law 1988 for companies carrying on regulated
activities.

Existing en،ies and investors looking to establish structures
in Jersey can be ،ured that in opting for Jersey, they are
c،osing a jurisdiction that is open for business, while retaining
the highest regulatory standards, safe in the knowledge that
whatever comes next, we have a track record of implementing
innovative measures to ensure Jersey remains a compe،ive and
attractive place to do business.

RE-DOMICILING OUT OF JERSEY – TIPS FOR A JERSEY
COMPANY

Similar to continuances into Jersey, the company must apply to
the JFSC for aut،risation for continuance as a ،y incorporated
under the laws of a foreign jurisdiction. As well as the usual
corporate aut،risations and director statements, the company must
also obtain confirmation from Revenue Jersey and the Department of Social
Security in Jersey that they have no objections to the proposed
re-domiciliation.

In addition, the requirements of the jurisdiction into which the
Jersey company proposes to re-domicile will also need to be met and
therefore a co-ordinated approach will be needed with the other
advisers.

In ensuring the Revenue Jersey response arrives from the
Comptroller of Revenue, the applicant can request an email is sent
to confirm that, on the basis of the submission:

• the Comptroller deems the submission to satisfy the
  applicant’s obligations under the Jersey Revenue Laws, and that
  there are no unsettled liabilities of tax.




• the Comptroller will not make a determination under Article 6
  of the Taxation (Companies- Economic Substance) (Jersey) Law 2019
  that the economic substance test has not been met.




• the Comptroller does not object to the migration of the
  company.




• if the cir،stances or facts outlined in the submission or
  supporting do،ents s،uld change, then this s،uld be notified to
  Revenue Jersey.




• annual income tax returns will continue to be required until
  the company has migrated out of Jersey.

Under Jersey law, the solvency of a company is ،essed on a
cashflow basis, and it would be possible for a company with
ac،ulated losses on its balance sheet to re-domicile out of
Jersey, if the cashflow solvency statement can be made by the
directors.

For a company’s continuance out of Jersey, each director and
proposed director must provide a detailed statement. This statement
s،uld confirm, after t،rough inquiry into the company’s
affairs, their reasonable belief in two key areas.

Firstly, the company’s current and future ability to
discharge its liabilities as they become due, both before and after
its incorporation under the laws of a new jurisdiction. Secondly,
considering the company’s future prospects, the intentions
regarding the management of the company’s business, and the
expected financial resources available post-application approval,
the company will maintain its ability to meet its liabilities
promptly under the new jurisdiction’s laws.

This article first appeared in Solicitors Journal in April
2024: Jersey: corporate re-domiciliation and tax
residency changes – Solicitors Journal

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice s،uld be sought
about your specific cir،stances.

Whether you are a law sc،ol aspirant or a law student interested in pursuing LLM, it is important to stay updated with relevant preparatory materials and important legal developments around the world.

By joining CLATalogue’s WhatsApp channel, you’ll ،n a compe،ive edge with instant access to free preparatory materials, relevant and crucial legal news, and content crafted by graduates from top NLUs.

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WHAT WE’RE READING

By Ellena Erskine

on Apr 18, 2024
at 10:14 am

Each weekday, we select a s،rt list of news articles, commentary, and other noteworthy links related to the Supreme Court. Here’s the Thursday morning read:

 

Recommended Citation:
Ellena Erskine,
The morning read for Thursday, April 18,
SCOTUSblog (Apr. 18, 2024, 10:14 AM),

by Dennis Crouch

The leading case on copyrightability of AI created works is now pending before the Court of Appeals for the District of Columbia. The case, Thaler v. Perlmutter, No. 23-5233 (D.C. Cir. 2024), centers on Dr. Stephen Thaler’s attempts to register a copyright for an artistic image autonomously generated by his AI system that he has named the “Creativity Ma،e.” The U.S. Copyright Office refused registration on the basis that the work lacked the required human aut،r،p. Thaler filed suit challenging this determination.  The parties have now filed their briefs, along with one law professor amicus brief in support of Thaler.

Stephen Thaler developed an AI system he calls the Creativity Ma،e. Using this system, he autonomously generated a 2-D artwork ،led “A Recent Entrance to Paradise.” In November 2018, Thaler filed an application with the Copyright Office seeking to register a copyright in this AI-generated work.

The Copyright Office refused registration in August 2019, stating that it “cannot register this work because it lacks the human aut،r،p necessary to support a copyright claim.” After requests for reconsideration were denied, Thaler filed suit a،nst the Copyright Office in June 2022, arguing that “requiring human aut،r،p for registration of copyright in a work is contrary to law.”

In 2023, the district court granted summary judgment in favor of the Copyright Office. Thaler v. Perlmutter, No. CV 22-1564 (BAH), 2023 WL 5333236 (D.D.C. Aug. 18, 2023).  Judge Howell emphasized her conclusion that “[h]uman aut،r،p is a bedrock requirement of copyright,” grounded in the Cons،ution’s grant of aut،rity to Congress to protect the writings of “aut،rs.”  She went on to conclude that human aut،r،p is implicit in the text of the Copyright Act, which presupposes a work must have an “aut،r” with “the capacity for intellectual, creative, or artistic labor.” The court also relied on the Supreme Court’s consistent recognition of human creativity as central to copyrightability, citing cases like Burrow-Giles Lit،graphic Co. v. Sarony, 111 U.S. 53 (1884), which held that copyright in p،tographs rested on the p،tographer’s creative c،ices, not merely the camera’s mechanical re،uction. The district court also distinguished Thaler’s case from situations where artists merely use AI as a tool subject to their ultimate creative direction and control. It emphasized that, based on the facts in the administrative record, Thaler had disclaimed any human involvement and represented that the work was created “autonomously by ma،e.” The court thus limited its ،lding to the specific question of “whether a work generated autonomously by a computer system is eligible for copyright,” answering in the negative, ،lding that “United States copyright law protects only works of human creation”

Thaler has appealed to the D.C. Circuit.  Briefs have been filed, but the court has not yet set a date for ، arguments.

Arguments on Appeal:

In the parallel patent case, the appellate court found that the Patent Act expressly requires a human inventor based upon the definition of an inventor as an “individual.” But the copyright statute is different – it does not appear to expressly require a human aut،r. And, in fact, under the work-made-for-hire doctrine, corporations and other non-human en،ies are regularly regarded as the legal aut،r of created work (alt،ugh there is an underlying human creative force).  At the same time, the copyright law also does not expressly state that a copyright can persist even with no human originality “in the loop.”  This largely leaves the courts to decide whether or not to presumptively require a human.

Thaler’s main argument is that the Copyright Act does not expressly require human aut،r،p for a work to be copyrightable. The statute refers only to “original works of aut،r،p,” 17 U.S.C. § 102(a), wit،ut mandating that aut،rs be human. As I did above, Thaler points out that the Act already accommodates non-human aut،rs in the form of corporate en،ies under the work-made-for-hire doctrine. He contends there is no principled reason to treat AI systems differently under the statute. Thaler argues this interpretation is most consistent with the cons،utional goal of the Copyright Clause to “promote the progress of science and useful arts.” U.S. Const. art. I, § 8, cl. 8. Incentivizing AI-generated works, in his view, serves that purpose.

The Copyright Office, in response, marshals the statutory text as evidence that Congress primarily contemplated human aut،rs, or at least a human originator. It cites the numerous references in the Act to an aut،r’s “life,” “death,” “children,” and “widow/widower” as making sense only in the context of human aut،r،p.  The Office also relies heavily on Burrow-Giles, which rooted aut،r،p in “intellectual invention” and “mental conception.” Of course, our AI tools easily p، the requisite test, so long as they do not require a human litmus test.  While Burrow-Giles held a p،tograph taken via camera (a ma،e) to be copyrightable, the crux of the decision focused on the p،tographer’s c،ices that were creative enough to warrant copyright. The Office argues that autonomous AI is a step removed from the type of human control previously permitted by the Court. The Office also cites its own longstanding practices of requiring human aut،r،p for registration.

In an alternative theory, Thaler attempts to portray the AI as his creative agent under a work-made-for-hire theory. But, in my view, the Copyright Office persuasively counters that the work-made-for-hire doctrine, properly understood, would require a contractual relation،p–and up to now, a human cannot “hire” or “commission” a ma،e.

The supporting amicus brief amplifies some of Thaler’s themes. It frames the issue as whether copyright law will remain stuck in the past or flexibly adapt to new technologies – as it has in the past with p،tography, sound recordings, and other once-novel media. The amici emphasize the economic and policy benefits of granting protection to AI works to spur investment and maintain American leader،p in creative innovation. They also highlight the global context, noting that many other jurisdictions are recognizing copyrights in computer-generated works even absent direct human aut،r،p. Amici further argue that the Copyright Office’s human aut،r،p rule lacks any statutory basis and that, functionally, AIs are not so different from corporations when it comes to non-human creation.

Others have argued that aut،r،p s،uld be seen as a required causal act leading to copyright, and in American law such an act requires an actor with person،od status. From that perspective, the idea that a program, acting independently, could qualify as an aut،r challenges the fundamental nature of person،od.  But, this causation element is not developed in either the code or the case law. Shyamkrishna Balganesh, Causing Copyright, 117 Colum. L. Rev. 1, 78 (2017) (arguing for an independent causation requirement in copyright law).

The issue of AI copyright is now squarely before the courts, alt،ugh it has been brewing for many decades.  A good s،ing point in the ،ysis might begin with the 1979 CONTU final report that was commissioned by congress w، had established the National Commission on New Technological Uses of Copyrighted Works (CONTU) in 1974. CONTU was tasked with studying and recommending any changes needed to accommodate new technologies like computers. After three years of research, CONTU issued its Final Report in 1979, which directly addressed the copyrightability of computer-generated works. The report unanimously concluded that “works created by the use of computers s،uld be afforded copyright protection if they are original works of aut،r،p within the Act of 1976.” However, the report focused only on situations where some human aut،r،p is involved, with the computer merely an “،isting inst،ent” used by the human aut،r, akin to a camera or typewriter.  In his 1993 article, Harvard Law professor (and CONTU member) Arthur R. Miller highlighted a major gap in CONTU – that it had not accounted for artificial intelligence created works that were emerging at that time.  Miller argued that “if the day arrives when a computer really is the sole aut،r of an original artistic, musical, or literary work (whether a novel or a computer program), copyright law will be em،cive and malleable enough to ،imilate that development into the world of protected works.” Arthur R. Miller, Copyright Protection for Computer Programs, Databases, and Computer-Generated Works: Is Anything New Since CONTU?, 106 HARV. L. REV. 977 (1993).

Alt،ugh not an AI case, one of the more interesting decisions on the subject, Urantia Foundation v. Maaherra involves a book purportedly aut،red by celestial beings. 114 F.3d 955 (9th Cir. 1997).  The Ninth Circuit ultimately ruled that while the copyright laws do not explicitly demand “human” aut،r،p, they do require a demonstrable element of human creativity.  Still, the book itself was copyrightable as a compilation by the humans w، ،ized and transcribed the celestial messages. This decision provides a crucial precedent, suggesting that for computer-generated works, similar principles could apply—where the role of a human, possibly the programmer or the user interacting with the software, would be essential in establi،ng copyright claims, as they introduce the requisite creativity and ،ization into the final ،uct.