Canada, Israel, 301, Pro Patria and Pro Patry

Bill Patry has a great blog today about Israel, Canada and the U.S. "301" watch list, or "wish list", as Bill calls it. He says:

Of course, even large countries like Canada have been threatened: the U.S. is reported to have told Canada that the U.S. won’t do anything Canada wants in other areas unless Canada adheres to the WIPO treaties in the exact form that the U.S. has, and that such implementation is the highest priority in U.S.–Canada relations. That’s ridiculous bluster. I hope that the example of Israel, a much smaller and very vulnerable nation, standing up to the IIPA inspires the Canadians in drafting their anticipated copyright reform legislation. And one thing that might strengthen Canadian resolve is the experience of Israel with the migration of the watch list into an evolving wish list.

Read his whole blog. Canada should welcome the constructive attention of a great American scholar such as Bill Patry. With a few notable exceptions, Canadian copyright scholars have been too quiet for too long on too many of these issues.

HK

Important Study on Limitations and Exceptions

Here's a major new study on limitations and exceptions by Bernt Hugenholtz and Ruth Okediji.

HK

THE CMEC RED HERRING

CMEC is spending a lot of political capital on its campaign for a special education exception for use of the internet, using reasoning that Prof. Michael Geist bluntly and succinctly describes as “utter nonsense” and which Prof. Sam Trosow has dissected in greater detail.

One wonders whether CMEC is aware of the following:

• Since 1871, there has been a firmly established doctrine of “implied license” in the law of intellectual property, which holds that when somebody has acquired something that was put on the market by the rights holder, that person can use it as they wish, absent some clearly binding agreement to the contrary. Here’s the original wording as repeated recently in the House of Lords by Lord Hoffmann:

Put shortly, the problem is to explain why, for example, a patentee cannot not complain when someone to whom he had sold the patented product then, without any further consent, uses it or disposes of it to someone else. The answer given by Lord Hatherley L.C. in the leading case of Betts v. Willmott (1871) L.R. 6 Ch. App. 239, 245 (which concerned the resale of a patented product) was that he did so by virtue of an implied licence.

"I apprehend that, inasmuch as [the patentee] has the right of vending the goods in France or Belgium or England, or in any other quarter of the globe, he transfers with the goods necessarily the licence to use them wherever the purchaser pleases. When a man has purchased an article he expects to have the control of it, and there must be some clear and explicit agreement to the contrary to justify the vendor in saying that he has not given the purchaser his licence to sell the article, or to use it wherever he pleases as against himself."

(emphasis added)

• That decision has been followed innumerable times in other IP contexts and cases. Translated into the current context, one can reasonably assume that when a newspaper or anyone else puts something on the internet without a pay wall or other TPM and especially if the site includes a “print” or “e-mail” or similar explicit invitation, the user can do just that. Everyone knows how to cut, paste and save material from the internet - and everyone who posts material knows that it can and will be used that way. With or without a “print” or “e-mail” button, it is child’s play to use the browser menu to do just that.

The CMEC position is oblivious to one of the most lucid and empowering landmark decisions of any court anywhere anytime with respect to users’ rights, which holds that” "Research" must be given a large and liberal interpretation in order to ensure that users' rights are not unduly constrained.” Our Supreme Court in the CCH v. LSUC case in the words of its Chief Justice as unanimously concurred in by her colleagues was willing to allow law firms to make copies for commercial research purposes. The legal profession routinely makes multiple copies of entire works. For example, the rules of the Supreme Court itself require 24 copies of everything in the “record.” So, why is CMEC so worried about lawsuits reaching into K-12 classrooms for activity that is clearly either explicitly or impliedly permitted by the person posting it on the internet? Why does CMEC want to gild this extraordinary lily from the Supreme Court with an unnecessary and counterproductive amendment?

How will CMEC justify to everyone else outside its tent that there is an inevitable “a contrario” implication of their amendment, i.e. that everyone not in their tent must now get ready to pay an undoubtedly eager and ready collective known as Access Copyright, which would benefit greatly from the curtailment of the CCH decision that would result from CMEC’s proposed amendment? Does CMEC not appreciate that this process will almost certainly do it no good, the general public and corporate Canada much harm, and be of great benefit to Access Copyright?

Instead of potentially harming everyone else in Canada and weakening if not undoing the CCH v. LSUC decision, why doesn’t CMEC ask simply for what the Americans have enjoyed for years - which is immunity for educators from statutory damages where there is a good faith belief in fair use (or fair dealing in Canada’s case) and an explicit “classroom” exception, such as is found in §107 of the US legislation? Here’s the US provision. If CMEC and AUCC really want more certainty, which nobody else thinks they need, they it should ask for something along the lines of the emphasized wording to be included in a list of “such as” examples of fair dealing:

Notwithstanding the provisions of sections 106 and 106A, the fair use of a copyrighted work, including such use by reproduction in copies or phonorecords or by any other means specified by that section, for purposes such as criticism, comment, news reporting, teaching (including multiple copies for classroom use), scholarship, or research, is not an infringement of copyright. In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include —

(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;

(2) the nature of the copyrighted work;

(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and

(4) the effect of the use upon the potential market for or value of the copyrighted work.

The fact that a work is unpublished shall not itself bar a finding of fair use if such finding is made upon consideration of all the above factors.

Instead, the following is what we can surmise that CMEC and AUCC want to get, according to a paper recently published in (2007) 23 C.I.P.R. 1 by Wanda Noel and Steve Wills, who respectively advise CMEC and AUCC:

The education amendment would permit an educational institution or a person acting under its authority, including a student, to do the following acts in relation to all or part of a work or other subject matter that has been made publicly available on a communication network, provided the act is done in a place where a student is participating in a program of learning under the authority of an educational institution, for not-for-profit educational or training purposes, and provided that the source is mentioned, and, if given in the source, the name of the author, performer, maker, or broadcaster:
1. use a computer for reproduction, including making multiple reproductions for use in a course for instruction;
2. perform in public before an audience consisting primarily of students of the educational institution, instructors acting under the authority of the educational institution, or any person who is directly responsible for setting curriculum for the educational institution; and
3. communicate to the public by telecommunication to or from a place where a person is participating in a program of learning under the authority of an educational institution.

Ironically, if this is what CMEC is asking for, it would almost certainly end up giving educators and students far less rights than they already have. For example, as drafted this suggests that the exception doesn’t even apply to the student or teacher doing at home what they supposedly could do at the institution under the exception but which they almost certainly can do now anywhere without the exception. Go figure.

Who knows what wording we may seen in the new bill? Hopefully, nothing along the above lines.

HPK

Israel's Clever Statutory Damages Provision

Israel has come up with an interesting and clever twist on statutory minimum damages. It allows for damages of up to approximately the equivalent of USD $27,000 - but notably has no minimum. It also specifies that several infringements that are “part of a set of activities shall be deemed as a single infringement.” This would appear to greatly reduce the risk of a perverse and absurd result such as the $227,000 jury verdict against Jamie Thomas that worked out to more than $9,000 for every song she allegedly downloaded.

The statutory damages provision affects and infects numerous areas in Canadian copyright law, even though it has actually been applied only very rarely. It has made many educators and librarians led by CMEC who are already too risk averse even more nervous about doing there jobs and perhaps contributed to their belief that they need to seek an special exception for use of the internet, which many of us believe is unnecessary and harmful. Instead, they should focus on revising the statutory damages provisions, as should many others who are rightly or wrongly fearful of their application or misapplication. In the USA, from whom we copied the idea of statutory damages, educators basically get a free pass if they can show a bona fide belief that their activity constituted fair use. No such provision exists in Canada.

Anyway, here’s the Israeli provision which will come into effect in May. Israel’s previous law had a statutory damages minimum of app. USD $2,700 - which has now been eliminated. Israel’s old law was based on the 1911 UK law, as is Canada’s. The upper limit now is fairly high and could lead to greatly disproportionate awards - but appears to have some constraints on its application. Here it is:

56. Damages without Proof of Injury
(a) Where a copyright or moral right has been infringed, the court may, at the claimant's request, award to the claimant, in respect of each infringement, damages without proof of injury, in an amount not exceeding 100,000 NIS.
(b) In awarding damages pursuant to the provisions of subparagraph (a), the court may consider, inter alia, the following considerations:
(1) The scope of the infringement;
(2) The duration during which the infringement continued;
(3) The severity of the infringement;
(4) The actual injury caused to the claimant according to the assessment of the court;
(5) The benefit derived by the defendant from the infringement, according the assessment of the court;
(6) The character of the defendant's activity;
(7) The nature of the relationship between the defendant and the claimant.
(8) Good faith of the defendant.
(c) For purposes of this paragraph infringements carried out as part of a set of activities shall be deemed as a single infringement.
(d) The Minister may, by Order, change the amount prescribed in subparagraph (a).

Canada should consider this precedent very carefully.

I thank Israeli colleagues, David Mirchin, for bringing this to my attention and Neil Wilkof for providing a copy of the unofficial translation of the new legislation some time ago and to Michael Birnhack for providing a link to an unofficial translation which is here.

HPK

More on WIPO SCCR - "Do as we say, not as we do..."

Here's the KEI report.

Here's IP-Watch.

In a nutshell, the Broadcasters' Rights proposed treaty isn't dead yet...

And the attempt by Chile and others to promote a meaningful initiative on clarifying norms on limitations and exceptions is being opposed by the usual vested interests who are saying, in effect, "do as we say, not as we do."

HPK

WIPO Copyright Meeting

Most of the Canadian delegation to the SCCR got stuck in Ottawa during the great March Break Blizzard and couldn't get to Geneva in time to deal with this meeting.

In any event, the Chairman is -- once again -- Jukka Liedes.

Looks like we haven't heard the end of the proposed broadcasters' rights treaty...

HK

The Copyright Board Says "No" to Record Industry Collectives for Interim Tariff

The Copyright Board has just delivered a very interesting decision on February 29, 2008 concerning an application for an interim tariff by the recording industry while it pursues its quest for a permanent tariff said to be worth up to $50 million a year in additional and strongly resented and resisted costs to Canadian radio stations. According to the Canadian Association of Broadcasters (“CAB”), “The record labels are demanding an additional payment close to $50 million annually for the right to make technical reproductions that are secondary to playing the music over the air – a right for which radio broadcasters already pay.”

The proposed tariff would cover the “ephemeral” recordings necessary for the operation of radio station, since the practice of live to air broadcasts with “disc jockeys” operating their own turntables has long been obsolete for a long time. Radio stations have moved on to automation and computers to store and play the music, so they can broadcast it efficiently. The record industry now wants a very substantial tariff for this practice.

This is in spite of the fact that there is an explicit exemption for the practice of using ephemeral recordings for broadcast purposes in the US legislation. The legislation that effectively deprives Canadian broadcasters of the “privilege” (as Bill Patry calls it in his treatise) or “exemption” long enjoyed by their American counterparts and which has enabled and will enable the collection of tens of millions of dollars in royalties mostly for the benefit of American rights owners was one of the more astonishing results of the backroom activity in the 1996-1997 Committee hearings on Bill C-32. The so-called “commercially available” exception to a number of apparent exceptions and exemptions, including the ephemeral rights exemption, rendered them apparently meaningless. But that is now the law in Canada, at least as the Board has construed it ... so far. The owners of copyright in “works”, i.e. songs, have been collecting millions for the “ephemeral right” since 2003. Now, the record companies want in on the action, and want about five times as much as the composers, authors and publishers have been getting.

Back to the Board decision of February 29, 2008. The Board decisively rejected an application for an “interim” tariff by the record industry, i.e. a tariff that would kick in while the hearing process and potential judicial review unfolds (which could take years). The record companies apparently claimed though their collectives (AVLA and SOPROQ) that they needed such a tariff to fund their application for a permanent tariff, that they had no revenues from other tariffs, that the interrogatory process would be “burdensome” for them (one is “shocked, shocked” to hear such as suggestion...), and a few other points that the Copyright Board clearly and bluntly rejected. Here are some excerpts from the ruling, which has a judicial-like ring to it that will be welcomed by many objectors:

[3] The application correctly states the test for
granting interim relief as the Board has
developed it. First, an interim order can be
issued as long as the main application is not
plainly without merit. The collectives meet this
branch of the test. Second, granting the
application will relieve the applicant from the
deleterious effects caused by the length of the
proceedings. We find that the collectives do not
meet this branch of the test, because the
arguments they rely on to conclude that
deleterious effects exist are irrelevant,
inapplicable to the collectives or just plain
wrong.

[4] First, the collectives argue that neither has
“tariff income” to fund the proceedings. To the
contrary, we find the collectives are quite
capable of supporting the financial burden of
these proceedings. They probably have
significant licensing income. More importantly,
and contrary to what they state, they are not
without “tariff income”. They jointly receive
millions of dollars each year from the
Neighbouring Rights Collective of Canada
(NRCC) on account of the maker’s share of
royalties paid pursuant to section 19 of the Act.
They also receive 15 per cent of the private
copying levies, which also amounts to millions
of dollars. Other collectives use their other
incomes as a matter of course to subsidize
proceedings before the Board.


[5] Second, the collectives note that
interrogatories can be burdensome. That does
not help them. The interrogatory process
generally is of primary benefit to collectives;
they are more interested (and justified) in
seeking to understand the licensees’ business
model than the licensees are in seeking to
understand the collectives’ business practices.
To the collectives, the availability of the
interrogatory process is an advantage, not an
inconvenience.

[6] Third, the fact that tariffs of first impression
often are judicially reviewed is irrelevant at
best. A certified tariff is enforceable even when
challenged, unless the Federal Court of Appeal
suspends its application.

...

[11] Two points the collectives raised in their
reply of December 28, 2007 merit attention.
First, they state that the application for an
interim tariff should be summarily granted
because the CAB failed to show that the
application does not meet the test for granting
interim relief. That is looking at the issue from
the wrong end of the telescope. The person who
applies for interim relief bears the burden to
show that relief is required, whether or not
anyone else objects to the relief being granted.
Second, contrary to what the collectives state,
neither AVLA nor SOPROQ “are obliged to
pursue proceedings before the Copyright Board
in order to collectively administer their rights.”
These collectives are subject to the general
regime. They are entitled to pursue licensing
deals with individual users. Indeed, in the
general regime, such agreements trump the
tariff.

(emphasis added)

I cannot help but note that this is a little breath of fresh air as we await the end an extraordinarily long and drearily depressing winter in Ottawa...

HK

Canadian Copyright Collectives and the Copyright Board

I’ve just done a paper and given a CLE talk for the Law Society of Upper Canada entitled CANADIAN COPYRIGHT COLLECTIVES AND THE COPYRIGHT BOARD: A SNAP SHOT IN 2008. Here’s a copy.

Here’s my bottom line:

CONCLUSIONS

Canada’s system of collective administration of copyright has both many strengths and weaknesses. This is also the case in most other countries. Improvements are possible and necessary. Some of these can come from collectives themselves. Others will need to come from the Copyright Board, or the Government itself in the form of regulation or legislation.

Canada’s Copyright Board plays a greater role in the collective administration of copyright than comparable tribunals in Australia, the USA, UK and other common law countries, and probably all other major developed countries. It appears to have more full time members and staff than its counterparts in any comparable country. It has a long and rich history of which it can mostly be very proud. However, that is not to say that improvements cannot be made. This appears to be recognized.

Canada’s Federal Court of Appeal, and on occasion the Supreme Court of Canada, have played a vital role in reviewing all of this activity and in ensuring that the public interest element inherent in copyright law is kept in mind.

Much more work needs to be done. Perhaps it is time for another commission along the lines of those chaired by Justice Parker and Justice Ilsley to look at all of this along with other copyright issues more fully and in the interests of the Canadian public.

HK

More on Euro-Excellence v. Kraft

I’ve just done a short talk on the Supreme Court of Canada’s important Kraft decision (in which I was involved) for a LSUC CLE programme on February 28, 2008 in Toronto. Here’s my brief paper.

Here’s a bit of the bottom line in that paper.

The doors have now been opened to new issues such as copyright abuse or misuse, or the argument that copyright law cannot be used to limit free trade in articles not protected by copyright. Other arguments are also open. Current and future potential plaintiffs contemplating the use of copyright law to bar parallel imports of consumer products not protected by copyright may wish to be careful about what they wish for.

HK