Saturday, July 25, 2015

Access Copyright Gets its Wish for a Post-Secondary Tariff Hearing at the Copyright Board

PwC_Report_Infographic
http://accesscopyright.ca/media/bulletins/impacts-of-the-education-sector%E2%80%99s-interpretation-of-fair-dealing/

Access Copyright (“AC”) is finally getting what it wishes for, which is a consolidated hearing at the Copyright Board on its post-secondary tariffs for 2011-2013 and 2014-2017.

Here is a recent Notice from July 3, 2015 from the Copyright Board regarding Access Copyright (“AC”):
From: <Gilles.McDougall@cb-cda.gc.ca>
Date: Fri, Jul 3, 2015 at 4:28 PM
Subject: Access Copyright - Post-Secondary Educational Institution Tariffs, 2011-2013 and 2014-2017 - Ruling of the Board - July 03, 2015 [CB-CDA 2015-045]
To: 
arenaud@accesscopyright.cacgillis@accesscopyright.caefinlay@accesscopyright.casmagu039@uottawa.ca


[CB-CDA 2015-045]
RULING OF THE BOARD
In its Ruling of December 4, 2013, the Board denied Access’ application to consolidate the examination of the above-cited tariffs for essentially two reasons. First, the Board did not want to disrupt the then current proceedings in respect of the period 2011-2013, slated for a hearing that was to begin two months later, by adding new issues for examination. Second, it did not want to be in a position to have to certify a tariff for the period 2014-2017 on “what may happen” in a then potentially unstable market.
The first reason is now moot, and the second, much less relevant. Parties are now in a better position to provide useful information on this new, 2014-2017 period. In addition, both Access and Mr. Maguire agree that the consolidation would reduce costs for the parties. The Board thus confirms the consolidation of the examination of the above-cited tariffs.
Mr. Maguire’s application for intervenor status is granted. Access Copyright did not object to Mr. Maguire’s request.
No later than Wednesday, July 8, 2015, Access Copyright shall propose a process and a schedule for a hearing to start on Tuesday, January 19, 2016. This process should minimally provide for the filing of a supplementary statement of case by Access, the filing of a supplementary statement of case by Mr. Maguire and a reply case by Access. Mr. Maguire is allowed to respond to Access’ proposed process and schedule no later than Friday, July 10, 2015.
Finally, Access shall provide answers to the Board’s questions of June 3, 2015 (attached, for convenience) as part of its supplementary statement of case.
Gilles McDougall
Secretary General | Secrétaire général

Copyright Board of Canada | Commission du droit d'auteur du Canada
56 Sparks, Suite| Bureau 800
Ottawa ON K1A 0C9
Telephone | Téléphone 
613.952.8624
Gilles.mcdougall@cb-cda.gc.ca
          (highlight added)

In a subsequent Notice from the Board dated July 15, 2015, the Board sets out further deadlines:
  • Access Copyright is to file its supplementary case no later than Friday, October 30, 2015;
  •  Mr. Maguire is to file his supplementary case no later than Friday, November 27, 2015;
  • Access Copyright is to file its reply case no later than Friday, December 18, 2015;
  • Hearing is scheduled for Tuesday, January 19, 2016 at 10:00 a.m. in the Copyright Board’s Hearing room.
So, there will be a consolidated hearing for the proposed tariffs for 2011-2014 and 2014-2017 and it will start on January 19, 2016. At issue could be, amongst other things:
  • Fair dealing
  • Substantiality
  • AC’s repertoire and lack thereof
  • AC’s chain of title to the rights it purports to license
  • Whether any AC post-secondary tariff can be a “mandatory tariff”

Interestingly, AC in its letter of June 16, 2015 indicates that:
As the Board is aware, Access Copyright licensed post-secondary institutions under consensual agreements in the period 1991 to 2010. Beginning in 2011, a number of post-secondary educational institutions chose not to renew their licences with Access Copyright. Some institutions paid royalties under the Interim Tariff approved by the Board but have since stopped making those payments.  
Access Copyright has a number of licences in place in the post-secondary sector that are due to expire at the end of December 2015. Some of those institutions have already given notice that they will not renew their licences upon expiry. Access Copyright projects that its royalty flow from the post-secondary sector will be virtually eliminated as of January 2016.
          (highlight added)

AC provides no information in this letter about take-up of its “Choice” and “Premium” license packages, but the foregoing statement suggests that the response has been virtually zero, since AC is projecting “that its royalty flow from the post-secondary sector will be virtually eliminated as of January 2016.”

Notably, Access Copyright will now be required to answer the Board’s clearly pertinent questions posed in the Board’s the Board’s Order of June 3, 2015.  These include questions about the “Premium” and “Choice” offerings and the state of AC’s licensing negotiations.

It is also notable that Mr. Sean Maguire, a university student, is continuing as an unrepresented “intervenor”. He is to be commended for his interest and persistence. However, his involvement can hardly be considered to be a proxy or even a remote substitute for representation of the public interest generally or the post-secondary educational sector and does not change the fact that these hearings are proceeding by way of default for all realistic purposes. One would have expected that the interests of the college and university communities should have been represented by their respective associations, namely ACCC (now Colleges and Institutes Canada) and AUCC (now Universities Canada), which presumably had the resources (assuming the resources were well managed) and the responsibility to confront AC in this normally adversarial arena.

However, these associations are notably absent now, having long ago withdrawn as objectors, and having also withdrawn their objections.  As I have pointed out several times, AUCC and ACCC had already by mid-2012 spent almost three million dollars ($3,000,000) that we know about to accomplish apparently little if anything other than providing a huge amount of interrogatory information for the benefit of AC and reaching model agreements that have been widely rejected by their own members. Even this amount of expenditures may not have been necessary if the associations had taken advantage of the Board’s well-established policy of requiring only “a reasonable amount of relevant information, from a reasonable number of institutions…”, which I have pointed out many times before, including here.

There are also some interesting parallel developments underway elsewhere in the Federal Court concerning the AC v. York U litigation. The trial in that matter is set to begin on May 16, 2016 and is scheduled to last for 15 days, which is a rather long time for a trial in the Federal Court. I will refrain, for the moment, from further public comment about the potential interplay between the Board case and the Federal Court case and how all of this could potentially affect the post-secondary community.

The Board has been thrust into a difficult position here “twixt a rock and a hard place”. This is a result of the apparent over-reaching of Access Copyright and the apparently underwhelming efforts of AUCC and ACCC.

The Board seems to have lately increasingly realized that it can and should, when appropriate, exercise inquisitorial powers (i.e. to ask its own questions and do its own investigations) in order to deal with the lack of submissions or inadequate submissions or evidence from one or more parties. As long as the Board ensures procedural fairness, this kind of approach is not only OK. It may indeed become more common and potentially necessary – not only when hearings proceed by default but when there are inadequate adversarial efforts as we have sometimes seen, even when large amounts of money have been spent. Will this be how this case plays out? I would not be surprised.

Access Copyright has long had an opportunity to negotiate a useful licencing scheme at a reasonable rate for post-secondary institutions. This would almost certainly have been a transactional license-based system, since AC may have serious problems with its entitlement to blanket license the repertoire for which it purports to claim entitlement. I debated this and related points with AC’s CEO Roanie Levy over a year ago at Brock University.

Instead, it is pressing ahead for a consolidated blanket license-based tariff hearing and seeking some arguably highly overreaching tariff rates for rights that it arguably doesn’t have for repertoire that it arguably doesn’t have – and, of course, wants these tariffs to be retroactive and “mandatory”. Indeed, AC is pressing for a result that is apparently very inconsistent with the Board’s recent provincial government tariff, not to mention considerable and consistent Supreme Court of Canada jurisprudence.  For university students, AC wants $35 per year for the period 2014-2017. That is approximately 70 times or 7,000% higher than the current rate for provincial government employees. While one can conceive that there is more copying per capita in universities than in government, it is also conceivable that AC’s share of the relevant repertoire in universities is even less than in the government realm and that fair dealing is even more applicable, especially given the inclusion of the word “education” in s. 29 of the Copyright Act in 2012.

Moreover, AC has just released an obviously very expensive study from Price Waterhouse Coopers  predicting doom and gloom in the Canadian publishing industry and the Canadian educational sector as a result of “the education sector’s interpretation of “fair dealing”.  See the dramatic downward spiral graphic from AC above, announcing this study, the most interesting and useful part of which may be the final “limitations” section at page 96 which includes the statement:
The findings of this Assessment are conditional upon such completeness, accuracy and fair presentation of the Information, which has not been verified independently by PwC. Accordingly we provide no opinion, attestation or other form of assurance with respect to the results of this Assessment.

AC will probably try to put this report in front of the Copyright Board. Of course, ACCC (now Colleges and Institutes Canada) and AUCC (now Universities Canada), have both long since withdrawn from this hearing as noted above and won’t be there to object or to do to the heavy lifting of cross-examination or to offer any responding evidence if the report is allowed in as evidence. Hopefully, if the report is somehow allowed in, the Board will at least have some appropriate questions. An excellent starting point for questions about this “sky is falling” approach is the three-part detailed analysis by Prof. Ariel Katz from about a year ago, aptly entitled  The Loss of Access Copyright Royalties and the Effect on Publishers: Sifting Fact from Fiction, the last part of which is here, with links to the earlier instalments. Ironically, the current PwC study is locked up tight for cutting and pasting purposes – thereby inhibiting “access” to a significant degree. Thank goodness for OCR technology. Further comments may follow from yours truly and others.

So, AC is getting its wish for an oral hearing on its proposed post-secondary tariffs. By pressing for such a hearing, all the while apparently ignoring the wishes of its best customers (and even suing one of them to set an example), the public interest, and the rulings of the Copyright Board and the Supreme Court of Canada, AC may learn that, when it comes to certain copyright matters, it’s important to be “careful what you wish for”.

HPK

Thursday, July 23, 2015

Copyright Conference at U of T on October 2, 2015 – Will Include One Hour Presentation by the Honourable Ian Binnie

Ian Binnie, C.C., Q.C.

This looks like it will be a very interesting and potentially very important copyright conference at U of T on October 2, 2015.

The star of the event will no doubt be the Honourable Ian Binnie,C.C., Q.C, a retired Supreme Court of Canada justice whose decision in Théberge v. Galerie d’Art du Petit Champlain inc., [2002] 2 S.C.R. 336, 2002 SCC 34 arguably kicked off and set the tone for the modern era of IP jurisprudence in Canada. It will be recalled that he famously opined in that case that:
The proper balance among these and other public policy objectives lies not only in recognizing the creator’s rights but in giving due weight to their limited nature.  In crassly economic terms it would be as inefficient to overcompensate artists and authors for the right of reproduction as it would be self-defeating to undercompensate them.  Once an authorized copy of a work is sold to a member of the public, it is generally for the purchaser, not the author, to determine what happens to it. 

He retired from the Court in 2011.

There will be other notable speakers and three panels. One may anticipate some sparks flying, for example in the panels on Fair Dealing and its Application to Educational Institutions and Review of Copyright Board: Past Behaviours and Expectations for the Future. Yours truly will be on the latter panel.

The conference is very reasonably priced and space is very limited. I expect that this will be a “hot ticket” event and early registration is strongly encouraged.

BTW, there’s a reasonably good chance that we will have a decision by the time of the conference from the Supreme Court of Canada in the CBC v. SODRAC case, which could make the event even more interesting.

The program is below.

HPK


Networking Coffee
8:00 am – 8:30 am
8:30 am – 9:30 am
Break
9:30 am – 9:45 am
Making Sense of Fair Dealing and its Application to Educational Institutions
J. Aidan O’Neill, Erin Finlay, Ysolde Gendreau, & Inba Kehoe
9:45 am – 10:45 am
Coffee Break
10:45 am – 11:00 am
Copyright Futures
Jean Dryden, Mistrale Goudreau, Martin Zeilinger, & Victoria Owen
11:00 am – 12:00 pm
Lunch
12:00 pm – 12:45 pm
12:45 pm – 1:45 pm
Coffee Break
1:45 pm – 2:00 pm
Review of Copyright Board: Past Behaviours and Expectations for the Future 
Paul Halucha, Gilles Daigle, Howard Knopf, & Stephen Spong
2:00 pm – 3:00 pm
Break
3:00 pm – 3:15 pm
3:15pm – 4:15pm
Closing Remarks
4:15pm – 4:30pm
Networking Cocktail Reception: Thomas Fisher Rare Book Library
5:30 pm – 7:00 pm


Wednesday, July 01, 2015

Access Copyright’s Post-Secondary Tariff – The Glacier is Starting to Melt at the Copyright Board


Here is a recent Notice from the Copyright Board concerning the Access Copyright (“AC”) proposal for post-secondary tariffs. This Notice has not yet been posted on the Board’s website, although it was issued at 11:40 AM yesterday, June 30, 2015: 

From: <
Gilles.McDougall@cb-cda.gc.ca>
Date: Tue, Jun 30, 2015 at 11:40 AM
Subject: Access Copyright - Post-Secondary Educational Institution Tariffs, 2011-2013 and 2014-2017 - Notice of the Board - June 30, 2015 [CB-CDA 2015-042]
To: 
arenaud@accesscopyright.cacgillis@accesscopyright.caefinlay@accesscopyright.casmagu039@uottawa.ca


[CB-CDA 2015-042]
NOTICE OF THE BOARD
The Board is of the preliminary view that, in accordance with the attached Access’ request, Access Copyright Post-Secondary Educational Institution Tariffs for the years 2011-2013 and for the years 2014-2017 should be consolidated. The reasons invoked by the Board in its ruling of December 4, 2013 to deny the application for consolidation have become moot with the passage of time. The Board also agrees on a preliminary basis with Access that a hearing on the consolidated matter could be scheduled for early 2016.
Mr. Maguire can provide comments on the Board’s preliminary view no later than Friday, July 3, 2015. Access may reply to the comments no later than Monday, July 6, 2015.
Gilles McDougall
Secretary General | Secrétaire général

Copyright Board of Canada | Commission du droit d'auteur du Canada
56 Sparks, Suite| Bureau 800
Ottawa ON K1A 0C9
Telephone | Téléphone 
613.952.8624
Gilles.mcdougall@cb-cda.gc.ca
(highlight added)

This is a very significant Notice that comes very quickly in turn after the Board’s Notice of June 18, 2015.

 June 18, 2015
[CB-CDA 2015-037]
NOTICE OF THE BOARD
Following Access Copyright’s attached request, the Board suspends sine die the deadline to respond to the June 3, 2015 Order. Further instructions will be issued shortly. Attachment: 2015-06-16 Application to Copyright Board requesting a hearing (final).pdf

The Board often moves at a glacial rate. But when it moves quickly, it can do so at amazing speed. When glaciers being to melt, they sometimes do so dramatically and make a big splash.

The above Notice of June 18, 2015 followed in turn very quickly from AC’s letter of June 16, 2015 setting the stage for judicial review following shortly after the Board’s Order of June 3, 2015. The June 3, 2015 Order asked some perfectly reasonable questions about AC’s proposed “Premium” and “Choice” offerings to post-secondary institutions. And no – AC has not gone into the cable TV business. On May 25, 2015 I had asked on my blog, re the implications of the Board’s devastating Provincial Government tariff:

What will this mean to Access Copyright’s new “Access Premium” and “Access Choice” offerings?  [Why does this sound more like a cable TV package? ;-)] Hard questions should be asked as to why universities should pay $18 per FTE for similar rights that Governments will now be paying less than $0.50 per FTE. That’s a 3,600% difference. While there is undoubtedly more copying per capita in universities than in Governments, it is hardly likely to be 3,600% more. And what effect will these “voluntary” license rates have on the tariffs being sought at the Copyright Board, which are much higher still – i.e. $35 for a university FTE and $25 for other post-secondary FTEs for 2014-1017.

AC’s letter of June 16, 2015 can be seen here. It doesn’t want to answer the perfectly reasonable questions and seems to be setting the stage to go to Court to force the Board to proceed with a hearing on AC’s Post-Secondary tariff, which has indeed been in a state of suspended animation for over a year. This is a file that has put the Board in a nearly impossible situation “Twixt the Rock and a Hard Place”.

Interestingly, AC also advised the Board on June 16, 2015 that “Also, we request that you kindly remove Blakes as counsel of record on this matter.  Instead, Art Renaud, Claire Gillis and I should be listed on the Board’s service list for Access Copyright”.  So, AC becomes yet another major collective to partially or wholly assimilate its Board and even judicial review work in-house. Indeed, its recent judicial review notice re the Provincial Tariff was filed by in-house counsel. This is yet another indication of the changing economics of Copyright Board work and the apparent possibility that some large firms representing some large collectives and objector associations have made or allowed these cases to become so complex and expensive that “big law” may have priced itself out of this once very lucrative market.

So – the Board seems poised to proceed as follows – allowing AC and the one remaining objector, an unrepresented  student named Sean Maguire, just a few days to respond – with Canada Day intervening.
  •  The Board evidently is of the “preliminary view” that it intends, inexplicably, to go along with AC’s request that it “revisit” its December 4, 2013 ruling denying consolidation. Now, and potentially controversially, the Board seems intent on consolidating Tariffs for the years 2011-2013 and for the years 2014-2017, a request that the Board had quite convincingly denied on December 4, 2013. In that brief ruling, the Board rightly raised complexities potentially arising from AC’s claims to payment for linking, hyperlinking and “making available”.
  •  The Board evidently intends proceed with an oral  hearing in 2016
  •  The hearing will be effectively unopposed (apart from Mr. Maguire, I am unware of any remaining objectors or interveners), following withdrawal of the two main objectors – AUCC and ACCC. As I have previously indicated, this withdrawal has never been publicly explained, but may well be for budgetary reasons, since AUCC and ACCC had already by mid-2012 spent almost three million that we know about to accomplish apparently little if anything other than providing a huge amount of interrogatory information for the benefit of AC and to reach model agreements that have been widely rejected by their own members.

Frankly, even as an avid Board watcher and sometime active counsel, it is not the slightest bit apparent to me why “The reasons invoked by the Board in its ruling of December 4, 2013 to deny the application for consolidation have become moot with the passage of time”.

If the Board provides AC with a “mandatory tariff” of any significant value, especially one that is based upon a “making available", linking, hyperlinking or other controversial basis, there will be much concern and even outrage but very unclear and uncertain recourse, if any,  in the public interest. That is because the enormous post-secondary community potentially directly affected were represented by associations (AUCC and ACCC) that have withdrawn their objections, without any public explanation. I should remind readers that I have been involved in a recent intervention in the Supreme Court of Canada on the issue of whether a tariff can be “mandatory”, and many await the result of that case with considerable interest.

All that said, nothing can be predicted with much certainty regarding the Board these days. Recent decisions of the Board may suggest that the Board is taking a more inquisitorial approach that allows the Board to go beyond the submissions and evidence of counsel, which may sometimes be inadequate on all sides, despite the money being spent. This is perfectly legitimate, as long as the Board takes appropriate steps to ensure procedural fairness. So, we may see even more of this in the Post-Secondary file.

Somebody needs to look out for the public interest in the post-secondary file. The AUCC and ACCC, although they have spent millions on legal fees, have apparently done nothing useful to do so.

HPK



Friday, June 26, 2015

D'OH - Right Case, Wrong Judge



It has been discreetly pointed out to me that that I was wrong in a post earlier today about Justice Robert A. Blair, the new Chair of the Copyright Board,  having participated in the 1989 case called R. v. Miles of Music Ltd., 1989 CanLII 255 (ON CA) from the Ontario Court of Appeal.  In fact, Justice Robert A. Blair was not appointed to Court of Appeal for Ontario until November 5, 2003. The Judge, Blair, J.A., who wrote the opinion that I had quoted was in fact Justice Duncan Gordon Blair, who sat on the Ontario Court of Appeal from 1979-1994. The case report does not include Justice Blair's initials. Even the Ontario Court of Appeal website is confused - it apparently misspells his middle name as "Godren"

I will update my blog from earlier today shortly and, meanwhile, offer a rare but in this case well-required “mea culpa”.

HPK