Back
on September 24, 2014, I posted about how Netflix was
seeking judicial review (i.e. an “appeal” in laypersons’
terminology) of a Copyright Board Tariff decision. Part of what I said then was
this:
The whole
technological landscape changed when Netflix launched streaming internet based
video into Canada in September, 2010. Netflix was technically only an
intervenor in the Board case. It is upset that the Board imposed a tariff on
the one-month “free” trial membership that Netflix offers.
Here is
how Netflix is affected by the Board’s tariff:
“For a
service that offers subscriptions to end-users: 1.7 per cent for the years
2007-2010 and 1.9 per cent for the years 2011-2013 of the amounts paid by
subscribers. In the case of free trials, a minimum monthly fee of 6.8¢ for the
years 2007- 2010 and 7.5¢ for the years 2011-2013 per free trial subscriber
shall apply;”
Fair
dealing for Netflix is clearly an issue. $0.068 per customer per month for free
trials adds up over the years with as many millions of customers as Netflix
has. Also unresolved and up in the air are issues around “downloads” and
“making available right” – on the one hand, the Board says that SOCAN not
entitled but then the tariff refers to
liability for downloads.
The
Federal Court
of Appeal (“FCA”) per Nadon, J.A. has now ruled. There is a
complex history to this case going back almost a decade to 2006, which is recited in the judgment and should be
read by all Copyright Board watchers. It is also noteworthy that this judicial review application was
argued on October 5, 2015. The Supreme Court of Canada’s ruling in CBC v. SODRAC was
rendered on November 26, 2015. This Netflix decision was rendered December 17, 2015.
Here,
in the interests of immediate information with minimal comment, is the succinct
bottom line of the FCA:
[52]
Before concluding, I would simply say that, in the end, rules of procedure are
there to serve the interests of justice. In my view, justice in this case required that Netflix be
given the opportunity of putting its case forward with regard to the issues of
fair dealing and technological neutrality.
VI.
Conclusion
[53]
I would therefore allow the application for judicial review with costs, I would set aside the Board’s
decision insofar as it pertains to royalties on free trials and I would return
the matter to a differently constituted panel of the Board for redetermination
in accordance with these reasons.
(highlight added)
Some
interesting questions naturally arise immediately:
- What effect might the CBC v. SODRAC decision have had on this case, if the ruling had been available at the time of argument?
- What effect will it have if this case goes back to the Board for redetermination?
- What effect will it have, if SOCAN should seek leave to appeal from this decision to the Supreme Court of Canada?
- Given that two of the three members of the Copyright Board who decided the original decision in 2013 are still on the Board, and only one new member (the Chair, Justice Robert Blair) has since been appointed and there are no other currently appointed members, how will the unusual but clearly intentional reference to “a differently constituted panel” play out? Will Section 22 of the Interpretation Act concerning "quorum" need to be considered?
Other comments will doubtless follow from me and others.
HPK
HPK
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