Monday, June 25, 2012

FAQ re the Access Copyright #ACdeal: 36 Q&As re Persistent Predictions of Peril as the June 30th "Deadline" Approaches

(©Access Copyright – who else would want to take credit?)
(Jim Bradford, The Canadian Press)
Above is the late but mostly unlamented spokesperson of Access Copyright (“AC)”. Despite Captain Copyright’s deservedly nasty, short and brutish life, his spirit lives on, apparently well nurtured by certain persistent pundits of peril. Also, we see above a lighting strike on Canada's iconic CN Tower, just a short distance from AC's offices. Being hurt by such a strike is a far greater risk than anything facing any Canadian educational institution or member thereof at the behest of AC.

In the above light, here is an FAQ  with three dozen questions and some perhaps inconveniently blunt answers about the recent deals reached by AUCC and ACCC, inspired by the earlier deals reached with UofT and UWO. For shorthand, let’s refer to the AUCC and ACCC “model licenses” as the #ACdeal where appropriate – which is the Twitter hash tag I have coined for this extraordinary capitulation by Canada's post-secondary establishment to a relatively small but very aggressive and persistent copyright collective that has clearly gotten the better of the AUCC and ACCC at every turn to date in the current Copyright Board hearing, and, as should now be apparent to all, for many years in the past.
  1. Are there any good reasons for post-secondary institutions to sign the AUCC or ACCC model licenses?  No – unless the institution is extremely risk-averse and simply wants to the pass the buck onto student – or actually about $26 per university FTE or $10 bucks per community college FTE.
  2.  Can the post-secondary institutions simply pass the costs along to students? This depends on the province.  
  3. Is $26 per FTE a good deal? Absolutely not. It is about 50% more than the previously negotiated average basic cost of $3.38  plus course pack cost (i.e. about $18) – which should have gone down in 2007 following the 2004 CCH v LSUC decision and the expiration of the previous agreement but which AUCC inexplicably allowed to remain the same. 
  4.  Is $10 per FTE a good deal for community colleges? It is certainly less than the AUCC rate – but merely being better than bad does not equate to being good. The question resolves to whether it will actually cost less per student on average than the current arrangement. Prof. Sam Trosow has called this “a bad deal at any price”. It’s still 300% higher than the pre-CCH basic figure of $3.38. 
  5.  Don’t the “digital rights” provisions justify the deal? No.  AC is believed to have a very weak, if any, “chain of title” to digital rights  in most all cases. And the digital rights and the digital indemnity it offers are, accordingly, extremely limited. And many of these rights are already paid for through expensive institutional licenses or simply don’t require payment – because they are publicly available with an express or implied license.
  6. Has AC ever sued an educational institutions or a staff member?  Not to my knowledge. 
  7. Could it do so, in the absence of a "mandatory" tariff?  Only if the actual copyright owner launches the law suit.  AC lacks legal status to commence any litigation on its own. Unless things have recently changed, and I think I would know (I should disclose once again my membership in AC), it is not an “owner” or an exclusive licensee of any applicable rights. Even an exclusive licensee must join the owner as a plaintiff. A non-exclusive licensee, such as AC, has no basis to sue for anyone for infringement. This may have been among the reasons that the much vaunted test case litigation by AC against Staples/Business Depot quietly fizzled and was dismissed on consent without costs. 
  8. Can the Copyright Board impose a “one copy of one work” policy that would force an institution to pay hundreds of thousands of $$$ or more for just one single instance of unauthorized copying of one work in the AC repertoire? The Board can issue whatever ruling it wants and AC will no doubt urge it to certify such a tariff  - but that does not mean that it will hold up in a court of law. The Board is not a court. It has been reversed several times by the Federal Court of Appeal (including in some instances in which I was counsel). Indeed, it is highly doubtful that a court would enforce such a “mandatory” tariff – for reasons ably set out by Ariel Katz in great detail and for many other good reasons. Not least of these reasons is that of simple common sense and the "golden rule" that allows courts to avoid absurd outcomes. It is extremely unlikely that any Canadian court would require any institution to pay hundreds of thousands or millions of dollars in addition to what has already been paid for copyright clearances for inadvertently making “one copy of one work” supposedly in AC’s repertoire, if that institution has been acting in good faith to clear its copyright needs without signing an overly expensive, inadequate, anti-competitive and unnecessary license either voluntarily or potentially as required by the Copyright Board in the form of a mandatory tariff. This is especially so because that repertoire cannot be ascertained by users and is, apparently, not necessarily even known to AC, which is one of its excuses for not making it public, as required by law. The anti-competitive refusal of AC to grant transactional licenses and its encouragement of its members to refuse to do so surely can only worsen the position of AC in any potential tariff enforcement proceeding. 
  9. What is the risk of operating without an AC license? As stated above, there is no known instance of any Canadian educational institution or employee thereof ever having been sued by AC. The one case of a library being sued – namely that of the Great Library of Law Society of Upper Canada - resulted in a landmark defeat for  AC. Unfortunately, AUCC and ACCC have, for whatever reasons, not taken full advantage of this ruling. Law firms and other business have certainly taken advantage of it and have seen no need to sign an AC license.  
  10. What is the risk of being struck by lightning in Canada? According to the Government of Canada, Canada averages over 2 million lightning strikes each year.  “And, despite our relatively short lightning season, 9 to 10 people are killed and between 100 and 150 people are injured each year by lightning in Canada.” The moral of the story is that lighting in is a far greater risk to university administrators and employees with far greater consequences on both a personal and institutional basis than the prospect of any lawsuit launched or funded by AC. 
  11.  Can an institution clear all of its copyright needs on its own?  Three dozen so reputable institutions, including UBC, Athabasca and York have been doing so for some time now – despite the best efforts of AC to frustrate such activity by withholding transactional licenses.
  12. But AC is allegedly refusing to provide transactional licenses and is discouraging its members from doing so – what can be done? Institutions should pursue a remedy under the Competition Act. This might be a very good case. Just because the Copyright Board has been unwilling to engage on the competition law aspects to date and just because, for whatever reason, neither AUCC nor ACCC have pursued this competition law issue does not mean that it is not worth pursuing. In fact, the reality is probably quite the contrary. 
  13. Has AC ever been called upon to make good upon its “indemnity” provision? Not to my knowledge. And see, for example, the latest available annual report for 2010.
  14. Is AC legally able to offer any kind of “indemnity”? The last I checked, AC is not licensed as an insurance company in Ontario. Its indemnity scheme is seriously questionable from a legal standpoint. I raised this point in a juried law review article 13 years ago and AC has never contradicted it. 
  15.  Have AUCC or ACCC done anything to get the AC tariff withdrawn or to prevent the Copyright Board from going on to certify a mandatory tariff?  Apparently not. Indeed, both associations appear to favour the idea. 
  16.  Isn’t it normal that when a dispute is resolved following a settlement, the case comes to an end?  Yes – that is almost invariably the case in any adversarial process and even at the Copyright Board. Why this wasn’t done here is a big question that deserves an answer from the associations that cut the deal on behalf of their members. However, there is very little that is normal about the way this case has been handled, even in the context of the Copyright Board, where certain long established practices differ in major respects from other Canadian tribunals and courts, but have never yet been seriously challenged because they suit the interests of the tariff applicants and most of the regular coterie of counsel involved on both the collective and objector sides.  
  17.  Were post-secondary institutions consulted about the #ACdeal? I don’t know about ACCC, but virtually none of the AUCC members were consulted before the deal was announced. There were supposedly about four persons from AUCC member institutions on a negotiating committee, but that process was secret to all the other members. 
  18. Is AC a “bully”?  Is there a better word to describe it? And sadly, its most effective enablers and apologists in key respects have been AUCC, ACCC and the UofT T and UWO.
  19. If AC can't make the "one copy of one work" theory fly, what else could it do?  The provisions of Bill C-11 set the maximum of statutory damages for “non-commercial purposes” at $5,000. And that includes ALL previous infringements for non-commercial purposes. Would this limit apply in an academic context? Most likely, yes.  So, arguably the worst that a university could face in an infringement action would be $5,000 unless AC were able to prove actual damages that exceed this amount - which would be very difficult in the academic context.
  20. Is AC a copyright “troll”?  In the sense of encouraging the perception of itself as lying in the weeds and looking for victims to scare and extract money from lest they be caught making “one copy of one work”, it sure is starting to look that way. 
  21. Do the Courts reward “troll “litigation?  Usually no and sometimes quite the contrary. Some notable law firms in the UK and USA have gone bankrupt and/or been put out of business, even with severe disciplinary sanctions to at least one hubristic lawyer, as a result of sanctions by the courts and a professional oversight body for abusive “troll” litigation.   
  22.  Is there controversy about the negotiation of the UofT/UWO and AUCC agreements?  Questions have indeed been raised. For example, see here, here, and here.   
  23.  Do AUCC or ACCC “get” fair dealing and the Supreme Court of Canada’s landmark 2004 decision in CCH v. LSUC?  There is little apparent evidence that this is the case. Indeed, their fair dealing “guidelines” and other evidence to date strongly suggest that the answer is no. They seem to be afraid of exercising their "users' rights" confirmed and conferred upon them by their  "Magna Carta" in the form of the 2004 CCH v. LSUC decision. Indeed, they seem often to take positions that are well suited to Access Copyright itself. It’s fair game to ask them why. 
  24. Will Bill C-11 once passed provide more clarity on fair dealing?  Maybe. It will include the word “education” as one of the explicit allowable fair dealing purposes. While this may be unnecessary and redundant, it is rather like chicken  soup in the sense that it may help and shouldn’t immediately hurt. In the pending K-12 Supreme Court case, both parties had agreed that the educational purpose was allowable, but disagreed on whether it met the other fair dealing criteria laid down in CCH v. LSUC. 
  25.  Will the forthcoming Supreme Court of Canada decisions improve things for post-secondary institutions?  Hopefully, yes. It’s very hard to see how things can get much worse than the result from the Copyright Board or Federal Court of Appeal in the K-12 decisions, both of which seemed to be erroneous in light of the Supreme Court’s own 2004 decision in CCH v. LSUC. It’s unlikely – despite the best efforts of the lawyers for the publishers and entertainment industries  – that the Court will reverse or cut back on its own landmark decision in CCH v. LSUC from only 8 years ago. Even if the oral argument by the K-12 appellants was “confused and confusing”, as Michael Geist put it at the time, the Court will hopefully carry on from where it left off in 2004 with its recognition and definition of "users' rights" that must be given a "large and liberal interpretation". Speaking of which, here is a gem of a decision from Justice Rennie of the Federal Court from a few days ago in Warman v. Fournier. This deals very clearly with certain aspects of fair dealing, and as well as the issue of what constitutes a "substantial" part of a work, clarifying that this can be more three and a part of a fourth paragraph plus the headline out of a 11 paragraph news article in the particular instance of the case. (I should disclose that I acted for an intervener in the K-12 case).
  26. When will Bill C-11 become law?  Very likely, by the end of June, 2012, it will have cleared the Senate and will be ready to be proclaimed in force.
  27.  When will we hear from the Supreme Court of Canada?  We could hear any time now. Decisions are often released during the summer. There is usually an advance notice of several days before judgments are released. 
  28. Why didn’t UofT/UWO and AUCC and ACCC wait on the outcomes from Parliament and the Supreme Court of Canada before entering into such bad deals?  That’s a good and obvious question, best addressed to these institutions and their counsel. Many would very much like to and deserve to know the answers. 
  29. Do these agreements cover hyperlinking? Yes. Universities that sign the #ACdeal will unnecessarily and gratuitously acknowledge and pay for the non-existent right to hyperlink. Any statement to the contrary is pure sophistry, if not completely misleading. A copy is a copy and there is no way to tell which hyperlinks lead to what and how many “copies” and by whom. If AC wants to link hyperlinking to copyright rights, it should ask Parliament to go where no other country has ever gone or likely ever will go. Meanwhile, universities should refuse to indulge AC’s fantasies on this issue. A hyperlink is simply a more convenient modern day form of a footnote. Would anyone say that inserting a footnote should require permission or payment to AC? The recent Warman v. Fournier decision from the Federal Court clarifies that there is no liability for merely hyperlinking to something that copyright owner has posted.
  30. Does the agreement make Canadian universities pay tens of millions for what already is or soon will be free? Yes, according to a prominent American law firm that can’t understand why Canadians would do so. But what is really striking from the U.S. perspective is that, for all that money, the license only allows copying of up to about 10-20% of each text, or one full chapter. Some critics argue that such a license is unnecessary, because educators are already permitted to copy approximately that amount without a license under existing Canadian law, or at least they will be upon the passage of Bill C-11, which is currently pending before Parliament. That legislation would expand Canada’s fair dealing exception to include education, parody and satire as non-infringing uses, aligning it more closely to fair use under U.S. copyright law. 
  31. Will AC be able to spy on professors’ and student’ emails and other private information? Why not? Given the poor results of the negotiations that have led to these model agreements, why should the academic community expect any better results when it comes to the privacy discussions that are to ensue under the #ACdeal under the aegis of AUCC and ACCC? BTW, we have heard nothing about where this issue has gone with UofT and UWO. These discussions are supposedly to settle the details. The devil always lurks in the details.
  32. Will AC interfere with the way professors and students go about teaching and research?  That would seem to be the  clear intention. It prevents or greatly inhibits working outside of the “secure network” into which AC can spy. So, in terms of digital, it could be “illegal” according to AC to work at home or on a tablet or a laptop that is not somehow tethered to this secure network. The deals will greatly exacerbate “copyright chill” on and off campus by effectively setting outer “legal” limits and requiring payment for activity that is already legal in many if not most cases. 
  33. How will the universities be represented at the Copyright Board as the hearing unfolds? AUCC has walked away from the hearing and withdrawn its objections, having suffered several setbacks, including losing two judicial review applications in the Federal Court of Appeal, with costs awarded in AC’s favour. ACCC’s intentions are not explicit at this time, but there are indications that it will also withdraw. These associations have apparently spent $1.7 million and $1,018,000 to date respectively on legal fees. One of the ACCC counsel recently suggested at a conference that the Copyright Board and remaining interveners could look out for the public interest henceforth. However, that is virtually certain not to happen. The Copyright Board cannot reinvent itself overnight to become an aggressively “inquisitorial” tribunal charged with defending the public interest. It has never worked that way  and,  even it had the jurisdiction to carry on in this manner, it lacks the resources to do so and, above all, it would not be inclined to do so. And AC would an open goal shot at successful judicial review with virtually nobody in the way.  The remaining interveners lack sufficient resources and access to necessary evidence to do what needs to be done, without some dramatic new development. Unless a new coalition of post-secondary institutions steps forward, there is a great danger that the Board will be pushed by AC to complete the hearing and impose a "mandatory" tariff, with the universities and community colleges being completely abandoned by the institutions that were expected to represent them and having spent almost $3 million dollars to date to get to the present situation.
  34. How serious is the looming June 30, 2012  “deadline” set by AC to sign in order to save on the retroactive charges?  Potentially no more serious than a “this week only” sale at a used car lot. Economics 101 suggests that in any situation where there are too few buyers responding to a “limited time offer”, the seller may very well extend the deadline and even lower the price. There is absolutely nothing "official" or Board-sanctioned about this "limited time offer". Ariel Katz currently lists 9 in his "Hall of Fame" who have refused to sign, five in "purgatory" that are thinking about it, and five in his "Hall of Shame" that have signed.
  35. Why did AUCC and ACCC apparently agree to the principle of retroactive increases?  Ask them. I can think of absolutely no good reason. AC has been collecting the “interim tariff” throughout, which was arguably already too high. In the case of the opt-out institutions, payments have been going straight to the rights holders- without AC’s 30% overhead deduction and very dubious distribution methodology. The fact that no party has yet challenged the sacred cow of retroactive tariffs at the Copyright Board does not mean that such a challenge would not succeed. There is, in fact, a venerable Supreme Court of Canada decision and a recent Federal Court of Appeal decision in which I successfully argued a related point that suggests that it could and would do so. However, such a challenge would draw attention to the unusually prolonged pace and practice of Board cases that would be unwelcome from the standpoint of most of the parties and counsel who regularly appear before the Board, even including some of those who act for the most active objector interests. 
  36. What is the ultimate answer to the AC dilemma?  There is renewed interest in an alternative collective run by and for the academic community. I first proposed this back in 1999.

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