Monday, March 12, 2012

Efforts Escalate to Reverse CCH v. LSUC and Mislead Canada's Parliament in Bill C-11 on the Three-Step Test

Unusual efforts continue unabashed and even escalate to somehow convince anyone who will listen that the Supreme Court of Canada got it wrong on fair dealing in its landmark 2004 decision in CCH v. LSUC, and that, if the Court does not “revisit” this decision in the current cases under reserve, Parliament should overrule it through legislation.

Prominent lawyer and lobbyist Barry Sookman has just published a guest blog by Dan Glover, who is his young associate and protégé at McCarthy, Tétrault. Mr. Glover’s blog is entitled Renewed Attacks on the "Effect on the Market" Factor. One can presumably assume that Mr. Sookman not only endorses Mr. Glover’s blog, but that Mr. Glover would never say anything about copyright law in public of which Mr. Sookman might disapprove.

As I read Mr. Glover’s blog, he seems to be saying:

-         That Michael Geist and I are publishing “misinformation masquerading as the correction of misinformation, a concept George Orwell labelled as “doublethink”;
-         That the “three-step test” from treaty law should be literally adopted in Canadian jurisprudence and incorporated into the Copyright Act, just to ensure that our Courts don’t miss the point;
-         That the word “education” should not be allowed into s. 29 of the Copyright Act, as proposed in Bill C-11; and,
-         That “The key flaw of CCH is that it misquotes English law to conclude that the "effect on the market" is "neither the only factor nor the most important factor that a court must consider in deciding if the dealing is fair" (para. 59).” (emphasis added). In other words, it seems that, according to Mr. Dan Glover, the Supreme Court of Canada (SCC) wrongly decided the CCH v. LSUC case.  

Mr. Glover hopes that the SCC will “will revisit this issue” in the current cases under reserve in which his firm (and many others including mine) have made submissions. He also believes that Parliament should deal with it:

So the question becomes what to do to avoid an imbalanced educational fair dealing exception. Around the world, courts have preserved the balance by placing primary importance on the question of whether a given use "would materially affect the market or potential market for a work, if it would supplant any part of the market for it, or if the challenged use should become widespread, it would adversely affect the potential market for the work". If a course of copying would have that effect, it is not excused by the fair dealing or fair use exception.
(Emphasis added)

That is very inaccurate in many ways, but the inaccuracy begins with his characterization of American law.

Mr. Glover accuses Prof. Geist and I of not understanding and even, in my case, misstating the law - apparently, by referring to the latest and controlling US Supreme Court decision on fair use and referring to the latest important book on fair use,  written in this case by two of America’s leading scholars on the subject (Aufderheide and Jaszi) and published by the University of Chicago Press. Mr. Glover apparently believes that he knows more about American copyright law than top American scholars such as Aufderheide and Jaszi. Mr. Glover dismisses this book as “ideologically friendly” to my point of view.

I could have also quoted from many other sources, including from William Patry, who states in his authoritative treatise Patry on Fair Use that:

§ 6:1. Generally
The least understood, and, as a consequence, most misapplied of the factors is the fourth. [FN1] This misapplication is of relatively recent vintage, however, and may be traced to two Supreme Court decisions a year apart, Sony Corp. of America, Inc. v. Universal City Studios, Inc.[FN2] and Harper & Row, Publishers, Inc. v. National Enterprises.[FN3] In a careful review of both opinions, Judge Pierre Leval concluded “in short the market effect by itself is nearly meaningless, we cannot interpret it without learning from other factors ….”[FN4] We shall first review how things went astray, and then attempt to set them aright. (footnotes omitted)

Indeed, I could have quoted as well from Patry’s overall treatise on Patry on Copyright in which he explicitly mentions and approves the SCC’s decision in CCH:

Patry on Copyright § 10:2
Similarly, in CCH Canadian Ltd. v. Law Society of Upper Canada,[FN14] involving the Great Library's fulfillment of request-based reproductions, the Canadian Supreme Court well-articulated that exceptions to copyright (in its case fair dealing, a kissing cousin of fair use) are a part of the system, not a derogation from it. In interpreting the Canadian fair dealing provision, the Court wrote that they “must not be interpreted restrictively,” but rather accorded “large and liberal interpretation” so that “users' rights” are not impeded. (footnotes omitted, Note that Patry’s treatises are available on Westlaw).

So, readers are free to decide whether it is I, or rather Mr. Glover, who “misstate” the state of American law. His extensive focus on my short blog suggests that I have indeed struck a raw nerve. Although I doubt he will find much support for his views, his fallacious challenge is, to some extent, fair game. 

However, Mr. Glover’s attack on the SCC’s decision in CCH v. LSUC is quite another matter and is really remarkable for its chutzpah and hubris. He says that:

The key flaw of CCH is that it misquotes English law to conclude that the "effect on the market" is "neither the only factor nor the most important factor that a court must consider in deciding if the dealing is fair" (para. 59). (emphasis added)

It is not necessary to defend the CCH decision, which I and others regard as the “Magna Carta” of Canadian copyright law. It is a unanimous decision of the SCC from only eight years ago penned by The Right Honourable Chief Justice of Canada, Beverley McLachlin, P.C.  Mr. Sookman and many other top copyright lawyers had ample opportunity to make submissions in that case.  The result was a landmark, eloquent and unambiguous rejection of a wide variety of overreaching assertions by him and others who were seeking such results as copyright in judgments (based on editorial corrections, choice of fonts, etc.), and above all, to have the Court deny or at least severely curtail users’ rights of fair dealing in connection with research. However, that judgment clearly and categorically stated that:

59   Finally, the effect of the dealing on the work is another factor warranting consideration when courts are determining whether a dealing is fair.  If the reproduced work is likely to compete with the market of the original work, this may suggest that the dealing is not fair.  Although the effect of the dealing on the market of the copyright owner is an important factor, it is neither the only factor nor the most important factor that a court must consider in deciding if the dealing is fair.  See, for example, Pro Sieben Media AG v. Carlton UK Television Ltd., [1999] F.S.R. 610 (C.A.), per Robert Walker L.J. (emphasis added)

That decision has been praised far and wide by Canadian and notable foreign scholars, such as William Patry. Indeed, Mr. Glover and Mr. Sookman not so long ago relied on this decision, in the context of arguing against further statutory expansion of fair dealing, that Canada already has sufficiently “broad and flexible” fair dealing provisions to permit “flexible fair dealing”, which they now apparently want to reject:
...Canada already has broad and flexible fair dealing provisions. Pro-reform advocates have acknowledged that the Supreme Court of Canada‘s landmark fair dealing decision in CCH instantly ranks as one of the strongest pro-user rights decisions from any high court in the world. (emphasis added) (B. Sookman and D.  Glover,  Why Canada Should Not Adopt Fair Use: a Joint Submission  to the Copyright Consultations, (2009) 2 Osgoode Hall Rev. L. Pol’y 55, p. 139 at 141.)

So, it’s remarkable but revealing to finally see an explicit indication that Mr. Glover and those for whom he speaks believe that the SCC got CCH v. LSUC wrong and that the Court should “revisit” it.

Mr. Glover, presumably Mr. Sookman, presumably the other lawyers who argued in favour of the “three-step test” in the SCC,  and presumably their various interested clients now want to see it in the Canadian statute. These others include Glen Bloom and his client CRIA (now Music Canada) and Casey Chisick, and his client CMMRA-SODRAC.  They apparently:

-        want the SCC to “revisit” CCH v. LSUC
-        want the treaty language concerning the  three-step test as found in Article 9(2) of the Berne Convention incorporated into Canadian jurisprudence and the Canadian statute, although they don’t say anything about the longstanding provision that follows  in Article 10(2) dealing with exemptions for teaching purposes. Nor do they point out that it is very rare indeed that treaty language is simply cut and pasted into domestic legislation
-        want Canada to have a far more restrictive fair dealing/fair use regime than their American-dominated clients prosper under in the USA.

Let us put the three-step test canard to bed once and for all. What the educators apparently sought in the SCC and now seek in Parliament is simply a fair dealing regime where the use of multiple copies for classroom use, the making of copies of a work that is “prescribed” by an instructor, and other common and essential educational, teaching, scholarly and research practices MAY be found to be fair, based upon the SCC’s six factor analysis, but are not ipso facto unfair, as the Copyright Board and the Federal Court of Appeal found.

To suggest that this would contravene international law is not only “speculative”. It is simply misleading and even nonsensical. If this were the case, the USA would have been successfully challenged a long time ago for its generous and explicit fair use statutory provision which reads as follows:

17 U.S.C. § 107

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.

What users are seeking in Canada is even more modest than this. In fact, Prof. Ariel Katz points out in an incisive and very important blog dated March 11, 2012 that the well-hidden copyright “grab” of digital rights by Access Copyright buried deep in Bill C-11 is much more likely to violate the three-step test:

In addition, readers who followed the attempts to roll back the Supreme Court’s decision in CCH and prevent any broadening of the language of the statutory fair dealing provision, must have noticed the specious argument fair dealing is inconsistent with the Three-Step-Test of the Berne Convention and other international treaties. Neither of those self-proclaimed advocates of authors’ rights seems to have any issue with the forced collectivization of authors’ rights, a move that is much more likely to be inconsistent with the Three-Step-Test than any expansion of fair dealing currently contemplated. It turns out that respect for the copyrights of others and genuine concerns about compliance with international obligations are very brittle concepts when ignoring them can turn a profit. (Emphasis added)

In any event, a recent treatise on by Paul Goldstein and Bernt Hugenholtz published by Oxford University Press notes (see § 11.4.3) that the USA and many other countries including The Netherlands, Germany and Japan have a wide range of generous exceptions for educational, instructions etc. that are completely compliant with international law.
The WTO decision concerning US §110 mentioned by Mr. Glover is not only completely inapposite (it concerns the clearly illegal exception that allowed “a wide variety of restaurants and bars to publicly perform copyrighted musical works for free”). The great irony of his misplaced reliance on this reference is that the USA - now putting pressure on Canada directly and indirectly through interest groups such as clients of Mr. Glover, Mr. Sookman, Mr. Bloom and Mr. Chisick to incorporate the wording of the “three-step test” - continues a decade later to flout that ruling and to be the singular major adjudicated, unrepentant and outstanding scofflaw of international copyright.

In conclusion, it would seem that Mr. Glover - and those for whom he presumably speaks or at least echoes, are now engaged in a remarkable series of  increasingly desperate statements as Bill C-11 comes closer to fruition and as the SCC contemplates its pending decisions in the two fair dealing cases currently under reserve.

The past week has seen explicit and indeed virtually simultaneous attacks on not only a major Canadian Bar Association submission to a Parliamentary Committee but, above all, a recent landmark and internationally acclaimed decision of the Supreme Court of Canadaeven while two decisions on its further application are still under reserve by the Court. This is not only unprecedented and inappropriate in terms of rhetoric, civility and decorum. These attacks were simply and fundamentally wrong in substance and deserve, at the very least, to be summarily and unequivocally dismissed by all concerned.  


PS - if you wish to make your views known at this time to those in Parliament who can do something about fair dealing, email the following people. You should be able to cut and paste this list directly into most email clients:,,,,,,,,,,,,,,,,

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