WIPO SCCR Meeting Geneva November 3-7, 2008

The WIPO Standing Committee on Copyright and Related Rights (SCCR) will be meeting next week in Geneva. It gets together typically about twice a year. The agenda and documents are available here.

The Chairman of this Committee for the past many years has been Jukka Liedes of Finland, who has invested much effort in trying for about a decade to get through a Broadcasters' Rights Treaty at WIPO - for which there is little consensus but which is still on the agenda.

He summarizes the latest state of play as this in his "informal paper", which is presumably somewhat more formal than his many previous "non-papers."


• The following two options arise from the assessment above in this informal paper:

A – A continuation of the process

- Another try could still be suggested on the basis of the document SCCR/15/2 rev.

- In addition, discussions could be based on informal papers.

- This endeavor should be open, inclusive and flexible.

- In the end, there could be an understanding that a new treaty might be established by a clear majority.

B – A possible new avenue

- A model based roughly on Articles 2 and 3 of the Geneva Phonograms Convention of 1971 could be envisaged; similar to that of the Brussels Satellite Convention.

- That model is different from those included so far in the working documents of the SCCR.

- That model could achieve the main objective of an international protection and the prevention of signal theft.

- To provide the delegations with an idea of the structure of such an option, its core provisions might be as follows:

“The Contracting Parties shall protect broadcasting and cablecasting organizations, who are nationals of other Contracting Parties, against unauthorized acts, including:

- retransmission

- fixation

- [other acts that might be agreed on].

The means by which this Treaty is implemented shall be a matter for the domestic law of each Contracting Party. The means shall be adequate and effective, and shall include one or more of the following:

- protection by means of copyright, rights related to copyright, or other specific rights;

- protection by means of the law relating to unfair competition or misappropriation;

- protection by means of administrative legislation or penal sanctions.”

• Finally, if after consideration of the options above (A/B) and possible other options, it will not in the present situation be possible to decide on the establishment of a new treaty, the SCCR should end these discussions through an express decision in order to avoid further spending of time, energy and resources to no avail. Such a decision could include a timetable for later revisiting and reconsidering the matter.


There are other perhaps more urgent and important issues on the table, such as limitations and exceptions. Moreover, various spokespersons for the blind are pushing hard to get WIPO to do something specific in their interest. See, for example, this initiative from Canada's own CNIB.

William New of IP-Watch provides more information here.

Under the new leadership of its new Director General, Francis Gurry, WIPO can potentially accomplish a great deal that could benefit many if not most sectors and countries that are concerned about IP. Let us hope that the SCCR can move beyond the largely unproductive past decade into areas where work should be done and positive progress seem more likely.

The Canadian position(s) going into this meeting are not known.

HK

Tony Clement - New Minister of Industry

Congratulations to Tony Clement on his appointment as the new Minister of Industry.

Minister Clement previously was the Minister of Health. As such, he would have been very familiar with the perennially intractable debates over the Patented Medicines (Notice of Compliance) (“PMNOC”) Regulations, and the extent to which big money and big lobbying have attempted to drive national and international IP policy. He would also have been involved in debates on counterfeiting, and other matters. All of this experience makes hin a logical choice to be Minister of Industry.

There are aspects of the PMNOC wars and the copyright wars that have much in common. For those interested in the history and state of play of the PMNOC regs, this very recent important judgment in Apotex v. Merck from Mr. Justice Roger Hughes of the Federal Court explains it all in a very readable and balanced way, and indeed speaks at great length about the concept of “balance” in the context of the Patent Act and PMNOC regulations.

The Minister of Industry has enormous responsibilities for both the patent and copyright files, along with many other duties that are even more visible. We wish hm well in this very important portfolio at this very important time.

HK

A Victory for Freer Expression Online in Canada

Off topic but important news:

The courageous Jon Newton and his excellent libel lawyer, Dan Burnett, have won an important victory in BC against Wayne Crookes. The Court held that the mere provision of a link to a defamatory third party website without a positive editorial comment on that material:

• does not lead to a presumption that persons read the contents of the website and used the hyperlink to access the defamatory words, and that
• reference to an article containing defamatory content without repetition of the comment itself or endorsement of it should not be found to be a republication of such defamatory content

Here's the judgment.

Essentially, the Court held that a link is much the same as a footnote, except a lot more convenient.

Congratulations to Messrs. Newton and Burnett.

HK

Google Settlement

Big news from the USA - re the Google Books litigation.

There is a big settlement. Here are some links:

Some details about the agreement is now online here.

A summary of the agreement is available here.

The agreement can be found here.

Those who own or think they may own a U.S. copyright interest
implicated by the agreement may wish to look here.

As for Canada, Google advises:

International Impact

Copyright holders - located in the US and internationally - may have their books included in this agreement. As part of a worldwide notice program, the settlement administrator will be reaching out to authors and publishers around the world to tell them about their rights under the settlement, which include the right not to have the settlement apply to them and the ability to register with the Book Rights Registry to control and profit from online access to their books.

However, because this agreement is the result of a US lawsuit, it only affects the Book Search experience for users accessing the site in the US. Outside the United States, the users’ experience with Google Book Search will be unchanged, unless the offering of such products and services is authorized by the rightsholder of a book.

More to come when more is known...

HK

SOCAN's Tariff 22 - the latest chapter

The Copyright Board has finally released its decision this past Friday, October 24, 2008 on the remainder of SOCAN’s Internet based “Tariff 22". This covers the period of 1996-2006. Here’s the decision. This is actually the second part of the second phase of the Board's reasoning on Tariff 22. The first part of the the actual tariff came out just over a year ago on October 18, 2007 and I blogged about it then here. That decision is available here. The hearings that gave rise to these two decisions took place in April and May of 2007.

The Board rejected SOCAN’s approach that would have seen a tariff on “uses” and, instead, imposed a tariff on “users”. In principle, according to the Board, SOCAN’s approach would actually have been more user friendly.

The Board evidently spent a lot of time on number crunching and considering a mound of evidence and came up with results that may or may not please the affected users. It is too early to say. The Board is clearly cognizant of the need to comply with recent appellate jurisprudence requiring that it provide adequate reasons for its calculations. The Federal Court of Appeal will rarely, if ever, set aside the Board’s rate calculations, unless there is inadequate reasoning to support them.

The gist of the rates is as follows, according to the Board:

• For commercial and non-commercial radio stations that already pay royalties to SOCAN for their conventional activities, the same rates are certified for their Internet activities. These rates are, for commercial radio, 1.5% of Internet-related revenues for a low music use station and 4.2% for the others. Non-commercial radio pays a rate of 1.9% of its gross operating costs. The rate bases are further reduced by at least 50% to account for the fact that not all of a radio station’s web pages contain sounds.
• For commercial, pay and specialty television, pay audio services and satellite radio services, the rates established are also the same as what these users already pay or will be paying to SOCAN. These rates are 1.9% for television and 12.35% for pay audio services (the rate for satellite radio has yet to be set). The rate base is also further reduced in the same way as radio.
• The Canadian Broadcasting Corporation (CBC), TVOntario and Télé-Québec will pay a proportion of 10% of the amounts they already pay to SOCAN, with an additional reduction of at least 85%. For the year 2006, this corresponds to amounts of approximately $125,000 for CBC, $4,500 for TVOntario and $2,700 for Télé-Québec.
• Websites that play music, but do not have a conventional counterpart, such as the Iceberg radio site, will pay a rate that depends on the amount of music they use: 1.5% with music use of 20% or less, 4.2% if music use is more than 20% and less than 80%, and 5.3% if music use is 80% or more. Again, the rate base will be discounted by at least 50%.
• Finally, the starting rate for game sites that use music will be 0.8%.

The Tariff is retroactive for ten years back to 1996, which is, in effect, twelve years because the rates for 2007 and on are likely to go up (they rarely, if ever, go down). The Board notes that “Only SOCAN can decide not to collect royalties retroactively.”

There may be legal arguments that the Board lacks jurisdiction to impose such retroactivity. However, the Board clearly doesn’t see it that way.

Of course, the main news is actually what was NOT decided - which pertained to “other sites.” These could range from little personal blogs to such mega sites as YouTube, Facebook, and MySpace. Other potentially affected sites could include countless restaurants, car manufacturers, retailers, film producers, and others that may use music on their websites for the purpose of selling other goods and services. SOCAN’s wording for this category was extremely vague and few if any of the potentially affected parties objected or maintained their objection. This is not surprising, given the usually enormous costs of participation with objector or even intervener status in Board hearings.

The Board decided in the end NOT to certify a tariff on “other sites” at this time. This part of the tariff has been rejected in a 2 to 1 split decision.

The majority said that it would not certify a tariff for these “other sites’ because:

• It would be unfair to reach back ten years to target hundreds of thousands of users for uses that are “extremely modest or that attract little or no attention.”
• In the absence of any reliable evidence for such disparate uses, any tariff would have to be “de minimis”;
• Social networking and similar sites are quite new and any music use would likely be quite modest; and,
• In the absence of sufficient evidence, the Board could not provide reasons that would satisfy the Federal Court of Appeal.

However, note that the majority said that the “parties will be expected to provide the necessary evidence to allow the Board to assess the situation.”

A dissenting member disagreed with the majority’s analysis of the “other sites”. Her reasons, at page 47, suggest that she would have been inclined to set a tariff for at least the “uses” that would generate significant royalties. She gives MySpace, Facebook, Google and Yahoo as examples. But she also concedes that SOCAN offered “no evidence” that would allow for a tariff to be set for “MySpace”, for example. She is also expecting users to be present at the next hearing. She says at para. 47 “I would expect users or their representatives to participate in the next proceedings to provide the Board with the information it requires in order to property assess the situation.”

The issue of “other sites” has clearly NOT gone away. Since a number of important parties have not filed objections for 2007 and 2008 or even 2009, the Board will likely permit full fledged interventions from any latecomers and hear all of these years together. The Board has virtually invited this to happen. There are a number of very good arguments that can be made against the incredibly vague wording that SOCAN has used over the years, and the absurd results to which it could lead.

For example, imagine the potential liability of YouTube or Amazon or a traditional large retailer selling widgets online based upon “ the greater of 10% of the Gross Revenues earned by the Site or Service or 10% of the Gross Operating Expenses of the Site or Service.” I should disclose that I filed written submissions on issues regarding these “other sites” pursuant to the Board’s Directive on Procedure on behalf of Retail Council of Canada.

There is a real possibility of more judicial review of Friday’s ruling. Thus, a thirteen year old tariff may still be far from a done deal.

Once again, the question arises as to why these things take so long, cost so much and still leave many affected parties out of the matrix. Indeed, the Board found that “It is through no fault of SOCAN (or the users) that the matter took as long as it did to reach a conclusion.”

This is not about “fault” or blame. It’s just that there’s got to be a faster way of dealing with these things, and Chairman Vancise is clearly seized of this problem. As he has stated,

If the Supreme Court of Canada can render a decision within six months of a hearing, there is no reason why this Board cannot do the same. My goal is to see that this occurs.

In fact, despite some exceptions, most litigation - even very complex cases - in Canada can go from start of the proceeding at the trial level to final judgment in the Supreme Court of Canada (if it gets that far) in about five years or even less. Given the rarity of Supreme Court involvement, most litigation is actually concluded much faster.

HK

$54 million pants suit appeal

Ex-Judge Roy Pearson of Washington, DC apparently had his appeal heard today in his $54 million dollar great American pants suit.

One must admit that his quest for excessive damages almost makes the RIAA look reasonable.

He does seem to be rather unsuited for the bench. Moreover, as one reader of the WSJ blog noted:

Maybe Pearson will finally get his comeuppants.

HK

On Poetic Justice and Subsidies

Countless reputable pundits and reports have pointed out that the Conservative Government may have missed its opportunity to get a majority in the October 14, 2008 election because it insisted on cutting $45 million from subsidies to the arts. Whether or not that was actually what was done or intended doesn’t matter for present purposes - perception was reality, at least in Quebec.

What about subsidies to the arts? There are many justifications for them. Historically, the main ones include:
1. The arts - at least those worthy of the name - require subsidies because they are inherently elitist and expensive. Once upon a time, at least in Western Europe, the subsidies came from the Church. Then Kings and Queens and lesser royalty. Then robber barons. And now governments.
2. Why now from governments? That’s because we now have something called democracy. Overall, taxpayers have voted to have museums, galleries, operas and the other finer things subsidized.
3. Arts subsidies generate great economic returns in terms of increased economic activity in the form of multiplier effects - ranging from tourism and restaurants to lucrative employment for carpenters and electricians. People flock to New York because of the arts, not because of sandy beaches.
4. Without the elite arts, we don’t have much to be proud of or that distinguishes Canada from the rest of the world, and particularly the USA. The USA actually provides huge subsidies to the arts through its great philanthropy system, paid for indirectly by middle class taxpayers through lower taxes on rich people and the encouragement of large gifts to such organization as the Metropolitan Opera.

How does this relate to Canadian copyright law and - of all things - the current campaign of the League of Canadian Poets against Access Copyright?

The poets need to be careful what they wish for. Access Copyright’s current distribution mechanism, while deeply flawed, essentially guarantees about $500 a year to every published poet - no matter how obscure and unread (and uncopied) that person may be. A more accurate and equitable system - assuming such a thing were even possible - likely would result in much less annual income from reprography for most poets. Unless I am missing something, it would seem doubtful that the principle licensees of Access Coypright, namely schools, universities, and governments do lot of photocopying of Canadian poetry. And what is done is very likely to be fair dealing, post CCH.

This is a perfect example of where subsidies would work better than a large, rich and litigious collective with enormous overhead and legal costs that can’t measure actual entitlement. In fact, it would be much more efficient from an economic standpoint to subsidize Canadian publishers, writers and poets through an expanded and adequately funded Canada Council than through Access Copyright. The Canada Council has a long history of working well through a combination of bureaucratic support and analysis and peer review by juries.

There would be no need to subsidize foreign publishers, writers or poets, because NAFTA has an exception with respect to national treatment for cultural programs and the Canada Council has been around for decades.

In return for more generous and efficient subsidies, the Copyright Act should be amended to lighten up on statutory damages and confirm the legality of copying for research, private study and multiple copies for teaching and classroom purposes, provided that such copying does not go beyond being “fair”. The Supreme Court of Canada has put most, if not all of this, in place already with the landmark CCH v. LSUC decision. The remainder can be found in §107 of the US Coypright Act, so the US can hardly complain about such a provision.

These are ideas worth considering - now - and before another revision bill is introduced.

HK

Audting Access Copyright?

As I mentioned yesterday, the League of Canadian Poets is on the case about Access Copyright, a collective that has over $37 million in most recently reported revenues, almost all of which comes from taxpayers. The distribution mechanism to actual creators has been severely criticized. The League of Canadian Poets is apparently asking for Canadian Heritage to audit Access Copyright.

It might be noted that Access Copyright had reported expenses of over $7 million in its most recent reported year and reports expenditures in 2006 and 2007 of almost $2.5 million for “Copyright Board filings.”

Offhand, I don’t see where Canadian Heritage would have any legal authority to “audit” Access Copyright. That said, the Federal Government has been an early and enthusiastic licensee of Access Copyright, and its early willingness to pay very substantial licensing fees helped get Access Copyright - then known as CanCopy - up and running. The Federal Government currently should arguably be paying much less to Access Copyright than in the past because the Supreme Court of Canada has ruled that “research” can be fair dealing and it would seem obvious that much if not most of the reprography that goes on inside Government would be for research purposes. It is not known whether the Feds have played hardball on this issue, or whether they continue to give millions to Access Copyright with little questioning as to why. Unfortunately, Access Copyright has abandoned its practice of more granular reporting of its licensing income that would provide more information as to the type of license and licensee, i.e. how much derives from schools, post secondary, public sector and corporate.

The point is that there is no reason why the major licensees of Access Copyright, such as the Federal Government, the universities, and the K-12 schools could not demand more transparency, along the lines set forth by Prof. Martin Friedland. There is no reason why these groups couldn’t insist upon an annual published audit that deals with specified parameters. I don’t mean the pro-forma type of statements that simply vouch for the annual published financial statements, which disclose very little.

Moreover, I have argued that the Copyright Board arguably could - if it chose to do so - exercise far greater oversight in situations such as this. This is what I have said in a recent paper, just published in the Intellectual Property Journal and available in essentially the same version here:

Oversight of Collectives

It is arguable the Board has sufficient powers under current legislation and in view of the cases mentioned above and many more to exercise more power of oversight over the internal workings of collectives. This could include:

• distribution mechanisms

• review of administration costs

• transparency and reporting of key financial information, including management, legal and
other professional expenses.

There is little point in imposing tariffs that are high by any standard, and in some cases relatively higher than in countries such as the USA, when the funds are often distributed years late and in a mystical manner and method, if indeed there is any adequate method. Such a tariff may not have the appearance of being “fair and equitable.”

It is an insufficient answer to rely on member democracy and accountability, since there is very little of this in the corporate governance of many of Canada’s collectives. Even the provision of a requirement of minimum transparency would serve to enable at least the chance for assertion of members’ rights and better governance.

The Board arguably could and should scrutinize the expenditures and efficiency of collectives.
Collectives exist not to reward their staff, consultants and lawyers but to collect and to distribute the royalties earned and deserved by their members. If Parliament is going to empower these collectives with monopoly rights, there needs to be sufficient accountability. This is an area where the Board could potentially regulate to some degree. If the Board believes it lacks jurisdiction to do so, then the Governor in Council or Parliament should do what is required.

To the Board’s credit, it has on occasion told collectives to take better care of certain classes of members. For example, in 1994 it told SOCAN that the proposed concert tariff was too low to be in the interests of its members:

The Board hopes, however, that SOCAN will give due consideration to filing its
proposed concert tariff for 1995 at a rate higher than that in the SOCAN/CAMP
agreement. The Board is of the view that unless this course is followed, the
interests of SOCAN's members will not be properly served.

Recently, the Board looked out for the interests of the independent members of the Canadian
Recording Industry Association (“CRIA”) and was decisively upheld by the FCA in brief reasons delivered from the bench.

Other thoughts will follow on this and related subjects. There is little point in Canada having the most copyright collectives of any country and the largest and best resourced copyright tribunal if the system does not do a commensurately good job for creators, users, and, to the extent necessary, others with legitimate economic interests based upon copyright. There are some changes and improvements that need to be made.


HK

Improper DMCA Takedowns and US Presidential Campaigns

EFF - bless them - is onto the use of improper DMCA takedown notices that stifle free speech in the course of the current US Presidential election campaign. Apparently, major networks are objecting to the use of very short clips incorporated into political speech and appearing on YouTube.

Here's the EFF take.

One of the few silver linings on Bill C-61 was that it included a "Notice and Notice" regime and not a "Notice and Takedown" mechanism, as in the US legislation. So, this kind of stuff would presumably not happen so easily in Canada.

HK

Creators v. Access Copyright

The League of Canadian Poets is on the attack against Access Copyright, an organization with more than $37 million in annual revenues believed to derive by far mostly from the public sector.

Here's a story from Quill and Quire that starts out as follows:

Over the past few weeks, the League of Canadian Poets has been publicly accusing Access Copyright – the association responsible for collecting photocopying fees for copyrighted materials and distributing the proceeds to authors and publishers – of failing to fulfill its mandate. The League’s press release states that “only a handful of large publishers are receiving significant benefits,” and that “writers and the small presses that publish most Canadian culture receive virtually nothing from the system.”

You can expect to hear more about Access Copyright when the Copyright Board finally releases its long awaited decision on Access's K-12 tariff for reprographic reproduction for 2005-2009. This hearing before the Copyright Board was held in June, 2007 with some follow up issues.

There is considerable suspense about this case for a number of reasons, including the fact that it is taking so long to hear from the Board when Chairman Vancise has previously announced a benchmark of six months pendency. In August of 2006, he stated in a speech:

If the Supreme Court of Canada can render a decision within six months of a hearing, there is no reason why this Board cannot do the same. My goal is to see that this occurs.

Chairman Vancise has also suggested in respect of this case, as anyone concerned with it will understand, that fair dealing "is an issue which will have serious implications and not one of course which I am prepared to discuss at this time."

Finally, afficianados of Access Copyright may wish to re-read Prof. Martin Friedland's critical report on Access Copyright's Distribution methodolody - or lack thereof. Regardless of one's opinion of Access Copyright, it is a good thing that this report was commissioned and made public, even if in redacted form.

HK

US v. China - WTO

GENEVA (Reuters) - The World Trade Organization (WTO) has found in China's favor in two out of three counts in a case involving protection of intellectual property rights brought by the United States, a trade source said on Thursday.

However, in Washington a U.S. trade official said the United States had won two out of three claims in the landmark case...

Looks like the parties can't even agree on who won or lost...

HK

Update: Here's some more detail from Forbes.

Liberal Position on Bill C-61

According to a Toronto Star report of an interview with Denis Coderre, the Liberal Heritage critic:

The Liberals would also ditch the already-tabled Copyright Bill and bring forward new legislation to protect the rights of both creators and consumers of digitized music, films and other intellectual property, Coderre added.

"We will work inclusively with the stakeholders involved in the copyright issue to protect Canadian content on the Internet, and to expand its use as well."

HK

Conservative Party Platform on Copyright

Today's Conservative Party platform states:

A re-elected Conservative Government led by Stephen Harper will reintroduce federal copyright legislation that strikes the appropriate balance among the rights of musicians, artists, programmers and other creators and brings Canada's intellectual property protection in line with that of other industrialized countries, but also protects consumers who want to access copyright works for their personal use.

We will also introduce tougher laws on counterfeiting and piracy and give our customs and law enforcement services the resources to enforce them. This will protect consumers from phoney and sometimes dangerous products that are passed off as reliable brand-name goods.

(emphasis added)

It's unclear whether a Conservative government would simply "reintroduce" Bill C-61 "as is", or whether it would come up with something that, unlike Bill C-61, actually does strike "the appropriate balance among the rights of musicians, artists, programmers and other creators and brings Canada's intellectual property protection in line with that of other industrialized countries, but also protects consumers who want to access copyright works for their personal use."

That's not a bad mission statement for a new copyright bill - but does not explicitly take into account that fact that the Supreme Court of Canada has confirmed that commercial parties, too, have a right as users to access works for research purposes in a manner consistent with fair dealing.

The reference to "customs and law enforcement services" suggests that the still secret ACTA draft treaty is on the mind of the Conservative Party.

Thus far, the Conservatives and NDP have explicitly referred to copyright in their platform. The Liberal Party has not done so.

HK

Speeches by Chairman of Copyright Board Now Posted

The Copyright Board has recently posted on its useful website three 2008 speeches by its Chairman, Justice William Vancise. These are as follows:

Ottawa, January 18, 2008 The Law Society of Upper Canada,12th Annual Intellectual Property Law Year in Review in which Justice Vancise:
• comments on several decisions of the Federal Court of Appeal and the Supreme Court of Canada dealing with “standard of review”. Note that this paper was given a few weeks before the important decision of the Supreme Court of Canada in Dunsmuir v. New Brunswick 2008 SCC 9, which is noted in a footnote.
• comments on the Federal Court of Appeal’s decision in CAB v. SOCAN 2006 FCA 337 involving the radio tariffs wherein the Board was criticized for the inadequacy of its reasons.
• comments on challenging by way of judicial review positions conceded by counsel before the Board. (This is clearly a reference the Ringtones case, wherein the objectors conceded “that downloading a ringtone is a communication by telecommunication”)

New York, March 28, 2008 Fordham Intellectual Property Law Institute Annual Conference in which Justice Vancise:
• considers the potential impact of the SCC’s Dunsmuir decision.
• comments further on the issue of adequacy of reasons and in particular on the Federal Court of Appeal’s reasoning in CAB v. SOCAN 2006 FCA 337 and Apple, Retail Council, et al v. CCPC 2008 FCA 9 heard on January 9, 2008 with reasons delivered the next day that quashed the Board’s decision to proceed with a hearing for a tariff on digital audio recorders.

Cambridge, Ontario, June 20, 2008 Broadcasting Invitational Summit in which Justice Vancise:
• comments on broadcasters’ concerns about “excessive multiple tariffs” and compares the Board with the CRTC.

These speeches by Justice Vancise are unusually frank and, frankly, unusual with respect to comments on certain decisions of the Federal Court of Appeal and the Supreme Court of Canada, which are the Courts that review the Copyright Board’s decisions. Accordingly, these papers are not only very interesting and important reading but are a “must” for all who need to know about the work of the Copyright Board and how its decisions are reviewed.

HK

Update on File Sharing Litigation

The EFF has a well documented and up to date analysis of the RIAA's litigation campaign against ordinary folks and how and why it hasn't worked.

HK

RCMP Comments in USA on Canadian Copyright

Jack Kapica of the Globe and Mail has an interesting story about recent comments by an RCMP spokesperson at an American Bar Association conference in San Francisco.

HK