Access Copyright v. York U – the Federal Court of Appeal Hearing is March 5 and 6, 2019

The long-awaited hearing in the appeal of the Federal Court’s decision in  Canadian Copyright Licensing Agency v. York University, 2017 FC 669 (CanLII), will take place on March 5 and 6, 2019.

As I said shortly after the release of the Federal Court’s trial decision in this case:

Indeed, if a tariff is not mandatory when parties voluntarily come to the Board to “arbitrate” a dispute, it should be all the more (“a fortiori” as lawyers say) non-mandatory when parties are dragged kicking and screaming before the Copyright Board and would prefer to clear their copyright needs in other ways.

As followers of this case will know, I attempted to get leave to intervene for the Canadian Association of Research Libraries (“CARL”). Unfortunately, in my opinion, the motion for leave to intervene was dismissed and a motion for reconsideration of that decision was also dismissed.

For those who are interested, which may include the academic community in general and copyright law professors and practitioners in particular, I am posting some of the material that was filed on behalf of CARL:

• CARL Notice of Motion for Leave to Intervene
• CARL Memorandum for Leave to Intervene
• Victoria Owen Affidavit in support of motion for leave to intervene (without exhibits)
• CARL Motion Record for Reconsideration
• Katz Spectre Part I article
• Katz Spectre Part II article
• McGill Centre for Intellectual Property Policy Factum filed in the SCC case Canadian Broadcasting Corp. v. SODRAC 2003 Inc., [2015] 3 SCR 615, 2015 SCC 57, wherein I appeared along with Prof. David Lametti, as he then was, and Prof. Ariel Katz. Based upon our argument, the Court, per Rothstein J., ruled that:

[112] I conclude that the statutory licensing scheme does not contemplate that licences fixed by the Board pursuant to s. 70.2 should have a mandatory binding effect against users. However, this case does not require this Court to decide whether the same is true of collective organizations. It may be that the statutory scheme’s focus on regulating the actions of collective organizations, and the case law’s focus on ensuring that such organizations do not devolve into “instruments of oppression and extortion” (Vigneux v. Canadian Performing Right Society, Ltd., 1943 CanLII 38 (SCC), [1943] S.C.R. 348, at p. 354, per Duff J., quoting Hanfstaengl v. Empire Palace, [1894] 3 Ch. 109, at p. 128) would justify finding that the Board does have the power to bind collective organizations to a licence based on the user’s preferred model — transactional or blanket — on terms that the Board finds fair in view of that model. However, this issue was not argued in this case.

[113]  I find that licences fixed by the Board do not have mandatory binding force over a user; the Board has the statutory authority to fix the terms of licences pursuant to s. 70.2, but a user retains the ability to decide whether to become a licensee and operate pursuant to that licence, or to decline.
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By way of update, here is what I recently said about this issue in my December 10, 2018 brief to the INDU Committee in its s. 92 hearings:

2.     We need to clarify that copyright board tariffs are not mandatory for users

The elephant in the room is the issue of whether Copyright Board tariffs are mandatory. They are not. I successfully argued that case in the Supreme Court of Canada (“SCC”) three years ago[2] – but most of the copyright establishment is in denial or actively resisting. A tariff that sets the maximum for a train ticket from Ottawa to Toronto is fine – and we used to have such tariffs before deregulation. But travellers were always free to take the plane, bus, their own car, a limousine, their bicycle or use any other legal and likely unregulated means.

There is intense litigation ongoing between Access Copyright and York University – now in the appellate stage and other litigation in the Federal Court involving school boards. Unfortunately, York failed in the trial court to address the issue of whether final approved tariffs are mandatory.[3]Hopefully, the FCA and maybe the SCC if necessary will get this right in due course. But we can’t be sure, and the other side is lobbying you heavily on this issue, including with such devious and disingenuous suggestions as imposing a statutory minimum damages regime of 3 – 10 the tariff amount on the  totally inappropriate basis of symmetry with the SOCAN regime – which is the way it is for good reasons that go back more than 80 years but would be totally inappropriate for tariffs outside the performing rights regime.

I urge you to codify and clarify what the SCC has said in 2015, consistently in turn with previous SCC and other jurisprudence going back decades – that Copyright Board tariffs are mandatory only for collectives but optional for users, who remain free to choose how they can best legally clear their copyright needs.

My suggestion is that Parliament use the well know legislative drafting technique of stating “for greater certainty”. This phrase already occurs 14 times in the Copyright Act, including for example s. 13(7). which states:

(7) For greater certainty, it is deemed always

to have been the law that a grant of an exclusive

licence in a copyright constitutes the grant

of an interest in the copyright by licence.

R.S., 1985, c. C-42, s. 13; 1997, c. 24, s. 10; 2012, c. 20, s. 7.

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I am suggesting that Parliament should now declare that:

For greater certainty, it is deemed always to have been the law that when the Copyright Board approves or certifies a tariff, whether interim or final, the collective to which that tariff applies cannot demand higher royalties or demand more onerous related terms and conditions than those approved by the Board, but the duty to pay such royalties and comply with their related terms and condition applies only to a user who has paid or offered to pay the royalties under such a tariff. A user who has not offered to pay such royalties may nonetheless be liable for copyright infringement.

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2) Canadian Broadcasting Corp. v. SODRAC 2003 Inc., [2015] 3 SCR 615, 2015 SCC 57.  See paras. 101 – 113. The factum presented to the SCC as prepared by myself, Prof. Ariel Katz and Prof. David Lametti, as he then was, is available here.

3) See Ariel Katz, Access Copyright v. York University: An Anatomy of a Predictable But Avoidable Loss, July 26, 2017 blog

HPK