The Latest From Canada’s Copyright Board: Comments on the 2024-2025 Annual Report

The Copyright Board has recently published its 2024-2025 Annual Report.

It’s difficult to find any tangible indicators of substantial progress following the scathing 2016 Senate report nine years ago that concluded that the Board was “dated, dysfunctional and in dire need of reform”.  Here are some of my detailed posts about the Board going back from 2023.

As for the current Annual Report, the following may be noted:

• The Board has not held an oral hearing since October of 2022.
•  It has renovated its very commodious and large prime real estate space at 56 Sparks St., Ottawa’s most famous address, which includes a large and now very rarely used hearing room.
• The Copyright Board has SIX (6) legal counsel. It is difficult to imagine why the Board needs more than one, considering its very limited and repetitive caseload and its very infrequent contested hearings. What do they all these counsel actually do?
• The Board lists 24 people on its payroll.
• The cost of operating the Board for the year ending March 31, 2025 was $5,674,097. That’s $638,343 MORE than was planned.  https://www.cb-cda.gc.ca/en/about-us/reports-publications/financial-reports/2024-2025-financial-statements
• The Board issued only 8 decisions re unlocatable copyright owners in 2024-25. These are typically only a few lines long and devoid of any details or reasoning. It is difficult to see how any of these would require more than a few minutes of consideration by anyone. Note that in 2014 the Board made concerted attempts to justify this regime including impassioned statements by former Chair William Vancise and Barry Sookman at the Fordham Conference. My aforesaid blog also has a good discussion about the unlocatable regime including comments from Andrew Martin and Ariel Katz. The Board has recently made an elaborate presentation on the topic. It would be interesting to know just how much time and resources are spent on these files and by whom and at what cost.

The Chair of the Copyright Board must be a judge or retired judge. Judges are presumably supposed to be judicious and follow the law – and not advocate on behalf of stakeholders.  Former Chair William Vancise was quite outspoken in this respect.  See also here. He also took almost four years following his retirement from the Board to render his last decision. Ironically, it was about Access Copyright, the tariffs of which have now been declared to be non-mandatory by the Supreme Court. It would be interesting to know if and how much he was paid for this unusually lengthy deliberation. As I’ve pointed out before:

Judges of the Federal Court and Federal Court of Appeal have eight weeks after retirement to render any pending decisions. Even Supreme Court of Canada justices have only six months after they retire to participate in decisions in cases on which they sat. The Canadian Judicial Council has specifically pronounced that “judges should render decisions within six months of hearing a case, except in very complex matters or where there are special circumstances.”

The most recent Chair has been retired Justice Luc Martineau. The Chair position is a GCQ5 Order in Council appointment.  Soon after the publication of the 2024-2025 Annual Report, he was re-appointed until October 9, 2027.  Interestingly, that’s only for two more years. It could have been for five years. Justice Martineau has been notably taciturn until now in his public pronouncements. However, he did say this in his Annual Report from 2021-2022:

The 2021‒2022 fiscal year was also marked by the Supreme Court of Canada’s decision in York v. Access Copyright, an important decision that clarifies, among other things, the scope of tariffs approved by the Board. This decision will certainly have an impact on the Board’s ability to deliver on its mandate, but it will be some time before we see the concrete results of this decision, including the cumulative effect of the decision and the changes made to the Copyright Act in 2019.

(highlight and emphasis added)

One would have thought that the Board’s “mandate” is defined by the Copyright Act as interpreted by the Supreme Court. If that means that Board tariffs aren’t mandatory, then they aren’t mandatory. The delivery of non-mandatory tariffs is, therefore, the Board’s “mandate”.  In other words, the Board’s mandate is presumably to deliver tariffs that provide fair compensation to creators and sufficient value to users that they will be utilized voluntarily, like the analogy I made to the SCC about the railway passenger tariffs in the old, regulated days. Then,  fares were prescribed but nobody was forced to take the train, e.g.  from Ottawa to Toronto, if they had other less expensive or otherwise preferable options. Even the SOCAN tariffs aren’t de jure “mandatory”, but they are de facto mandatory, for example, if you own a radio station and don’t want to limit your music to Bach, Mozart, and Beethoven. And even then, you would have to deal with the rights in the sound recordings and performances that aren’t in the public domain.

Justice Martineau says the following in the current Annual Report:

I am proud to present our 36th Annual Report, covering the period from April 1, 2024, to March 31, 2025. For the past few years, the Board has made great strides in terms of operational efficiencies. As I enter the last year of my first term as Chair of the Board, I am pleased to see the significant progress we have made in modernizing our operations and look forward to continuing this path of success with our new ViceChair and CEO, Drew Olsen.

Since my appointment in 2020, the Board has strengthened its role as a specialized tribunal and marketplace facilitator in the public interest. We have enhanced the efficiency, transparency and predictability of our procedures, and reduced our case inventory. Engaging with our stakeholders has been instrumental in supporting this transformation. In particular, the new advisory group will help ensure the Board remains aware of market realities and stakeholder needs.

As highlighted in our report Modernizing the Copyright Board: Status Update - May 2023, I am concerned about the related and growing economic and regulatory gaps in Canada’s collective management ecosystem that demand urgent action. Copyright stakeholders are still adjusting to legislative and judicial changes, including the Supreme Court’s decision in York University v Canadian Copyright Licensing Agency (Access Copyright), 2021 SCC 32. At the same time, the rapidly growing influence of AI on content creation and dissemination make the need for transparency obligations and access to credible market data even more urgent.

(highlight and emphasis added)

Some questions and comments:

·       Does the explicit reference to his “first term” suggest that he was expecting to be re-appointed for a second term?

·       Does he really expect much to come out of the “advisory group”? Several of them are counsel who have presumably lucrative practices before the Board. The vast majority of “users” have no meaningful, economical, or practical access to justice before the Board. As for ADR, that has been available for years. See Canadian Broadcasting Corp. v. SODRAC 2003 Inc., 2015 SCC 57 (CanLII), [2015] 3 SCR 615, <https://canlii.ca/t/gm8b0>  On behalf of Professors Ariel Katz and David Lametti (as he then was), I then persuaded the SCC that the result of the so-called “arbitration” regime was not binding even on willing parties to such hearings. Anyway, at least the Board mechanism for ADR under the current legislation doesn’t require paying an outside arbitrator or mediator, if that is what the Board is currently proposing.

The cost of operating the Board for the year ending March 31, 2025 was $5,674,097. That’s $638,343 MORE than was planned.  

Almost all of the Copyright Board’s tariff decisions are formulaic rubber stampings of previous tariffs without objection and with routine adjustments now and then for inflation. Even the Board doesn’t tout the “ confusing, arguably counterfactual and certainly counterintuitive” statistics suggested a decade ago in Jeremy de Beer’s very problematic 2015 study paid for by Industry Canada and Canadian Heritage.

There have been relatively* very few vigorously opposed* “inaugural” tariffs involving substantive issues since the launch of the modern Board in 1989 – and the Board has not fared well in the judicial review process of many of these decisions. I must confess to taking some credit for the Board’s embarrassing setbacks in its attempt to impose costly “levies” on the memory embodied in devices such as iPods, cell phones, and conceivably even computers. The CPCC (Canadian Private Copying Collective) wanted a “memory tax” that would have potentially amounted to $21,000 per terabyte.  So, for example, a 5 TB external hard drive that currently sells for about $224 at Best Buy would have a “tax” of $105,000 according to the CPCC arithmetic. The Board still props up the CPCC with a levy of $0.29 on blank  CDs as the CPCC bides its time waiting for better days. Does anyone know anybody who has bought any blank CDs in recent years, let alone use them for music? They are somehow still for sale. I think that the last time I ever used one was in a law firm many years ago to provide copies of very many and large files. That can now be done online or via cheap thumb drives. It’s impossible to believe that anyone still uses blank CDs to “ordinarily” record music. But the Board duly continues to keep this  “levy” alive and the CPCC on life support. Here’s the CPCC’s latest proposal for 2025-2027.

BTW, here's the THIRD judicial review application now underway in the Federal Court of Appeal in the Copyright Board's never ending undead Retransmission 2014-2018 saga that goes back at least a dozen years.

I’m old enough to remember the old Copyright Appeal Board. I wrote about this in 2019:

 This current Copyright Board “2.0” is the 1989 replacement for Canada’s then 53-year-old internationally admired and exemplary Copyright Appeal Board “1.0”, which was established in 1936 as a result of the legendary 1935 report of the Parker Commission. The Copyright Appeal Board consisted of a judge and two public servants, all of whom served part time. The secretariat services were provided on a part time basis by an employee in the predecessor of today’s Canadian Intellectual Property Office (“CIPO”). The Copyright Appeal Board had a mandate restricted to music performing rights societies – which then meant the two predecessors of SOCAN (which is itself the result of a merger that was permitted at about the same time as the new Board was created) and following the landmark 1988 revision of the Copyright Act.

See: The 30th (or 83rd?) Anniversary of Canada’s Copyright Board: Waiting for Version 3.0

The Copyright Board, with its ~$6 million budget which is less than a rounding error by most federal government measures, is clearly under the radar for long overdue reform. The Board states that “The total value of the royalties generated by tariffs approved by the Board was approximately $733 million in 2024, based on the annual reports of collective societies and internal Board estimates.”  The music business and copyright has often been said to be a “business of pennies.”  But those pennies add up to millions and billions for consumers. A handful of creators make a lot of money from this system, and most of the rest get occasional lunch money if they are lucky. And, of course, lots of lawyers, lobbyists, and executives do very well.

The music collectives still have way too much power, augmented by the availability of multiple  statutory damages. SOCAN has filed hundreds of lawsuits in the Federal Court. Thankfully, there are still bits of freedom at the “retail” level. My barber shop can still use an FM radio and not have to pay. The “double for dancing” wedding music “tax” is a relatively modest cost of such proceedings, all things considered, and most folks don’t get married very often. But SOCAN still has the unnecessary and potentially devastating weapon of being able to sue for three to ten times the amount of any “applicable royalties.” So be careful about allowing dancing at weddings.

And other unknown dangers still lurk. Somewhere some lawyer or lobbyist is dreaming of “tariffs” for AI ingestion and/or output, DVR storage, internet “tax”, or some other type of nightmare and, of course, Making Tariffs Mandatory Again. What could possibly go wrong?

HPK

* revised Nov. 25, 2025

Copyright Board Rules of Practice and Procedure: Plus Ça Change, Plus C'est La Même Chose?

After years of concern about extraordinary delays and other problems that led a Senate Committee to label the Copyright Board back in 2016 as “dated, dysfunctional and in dire need of reform”, the Board has finally come up with some supposedly new “Copyright Board Rules of Practice and Procedure: SOR/2023-24”

The only thing that is reasonably clear from this very prolonged, non-transparent, and no doubt very expensive exercise and the resulting new document is that the Board is trying to justify yet another budget increase of as much as a million dollars a year.

The costs of the Rules are expected to be less than $1 million annually. While parties will be required to provide information earlier on in proceedings, the amount or type of information required from parties will be the same as under the current Model Directive. (highlight and emphasis added)

It bears repetition that the Board has held only one actual hearing in more than five years and that almost all of its decisions for a very long time have been unimportant and mostly unopposed. Indeed, several proposed tariffs have been withdrawn by collectives.

There is nothing in the new procedures that warrants optimism that the Board will rise beyond its dysfunctional doldrums. Meanwhile, the Board will have 25 FTE employees and a net cost of operations before government funding and transfers $5,171,140 for 2022-2023.

I’ll discuss only four issues in these “new” Rules, namely

• Interrogatories
• Quorum
• Case Management
• Delays in Decisions

Interrogatories

The elephant in the room has always been and still remains the issue of interrogatories. Some collectives have used the interrogatory process to put forward irrelevant and arguably abusive questions to objectors that require the production of irrelevant and confidential financial information, etc. The results of overreach on the part of some collective and failure by the Board to control this process have ranged from time consuming fishing expeditions to try to build a case to the driving away of and withdrawal of well-meaning objectors as a result of oppressive and expensive financial and time costs, not to mention irrelevant disclosure of financial and other sensitive business information. Another tactic has been the demand for lengthy interrogatory answers from each member or too many members of associations representing a large membership. See my blog from 2011 about Access Copyright’s aggressive use of interrogatories that led to the withdrawal of all objectors even including major educational associations except from one lone individual whose reason for involvement was never clear.

The Board now explicitly gives itself the discretion to rule on the “scope”, etc. of interrogatories – which it has always had - but absolutely no indication of what type of information will be considered relevant and how it will refrain from making the problematic pro-collective rulings it has made in the past, e.g. as mentioned above:

Interrogatories

34 The Board or the case manager may make an order to permit interrogatories and to specify their number, type, scope and form, the time limits for their completion and the person to whom they may be addressed.

BTW, the Competition Tribunal has had “Rules” in place since 2008 that apparently work well – and are more like the time honoured processes in the Courts that require the exchange of Affidavits of Documents after adequate pleadings and subsequent discovery – rather than the endless and often abusive fishing expeditions enabled by the Copyright Board in the name of “interrogatories” that have driven worthy and well-intentioned objectors away, even long before it became clear that Copyright Board tariffs aren’t mandatory. Courts do not allow for preliminary and lengthy fishing expeditions by plaintiffs to determine the basis, if any, of their case. Courts do not allow plaintiffs to put the cart before the horse. Why would a rational objector spend a fortune engaging in interrogatories or fights about interrogatories and the other procedural uncertainties endemic at the Board to oppose a tariff that won’t even be mandatory at the end of the day?

Quorum:

There is a new and explicit provision re “Quorum”.

Quorum

10 In all proceedings before the Board, the quorum is one member.

I am not aware that anyone asked for this. In the past, this has been dealt with pursuant to s. 22 of the Interpretation Act, meaning that a quorum would be majority of appointed members.

It is bizarre that the Chair of the Board can now designate just one person to be a quorum. Even supposedly simple matters may become contentious and complicated for better or for worse – e.g. the Breaktrhrough Films “unlocatable” case – the decision for which seems to have disappeared from the Board’s expensive new website but can be found here thanks to Prof. Ariel Katz. Although it would seem inconceivable, this new Rule would allow only one member to decide such complex and economically significant matters such as the retransmission tariff, which is worth more than $100 million a year.

BTW, the Copyright Act provides that:

66 (1) There is established a Board to be known as the Copyright Board, consisting of not more than five members, including a Chair and a Vice-chair, to be appointed by the Governor in Council.

This suggests that there must be a least a Chair and a Vice-Chair. The question of whether or not there was a quorum very nearly became an issue in 2018.

Case Management

It's strange enough that, under the legislation and rules, a case manger could be merely an employee or outside consultant who could decide very significant procedural matters, presumably including such matters as rulings on interrogatories.

Case manager

66.504 (1) The Chair may assign a member, officer or employee of the Board or a person engaged under subsection 66.4(3) to act as a case manager of a matter before the Board.

Staff

66.4 ...

(3) The Board may engage on a temporary basis the services of persons having technical or specialized knowledge to advise and assist in the performance of its duties and the Board may, in accordance with Treasury Board directives, fix and pay the remuneration and expenses of those persons.

In the Federal Court and the Ontario Superior Court, case managers are Associate Judges and Masters respectively who invariably have been very experienced lawyers. Even if case management rulings can be entrusted to one person, that person should at least be a duly appointed member of the Board and one with adequate legal qualifications.

Under the new Rules, the case manager can decide such weighty matters as:

• whether interrogatories should take place and their parameters as applicable;
•  documents to be filed with the Board before a hearing, including legal briefs and case records

All that said, it is hard to see how this sits with s. 66.5(2) of the Copyright Act, which requires that:

Decisions

(2) Matters before the Board shall be decided by a majority of the members of the Board and the presiding member shall have a second vote in the case of a tie. (highlight added)

Delays

What other court of tribunal allows a decision to be pending for several years AFTER the adjudicators have “retired” and are presumably being paid while thinking about the pending decision? Judges of the Federal Court and Federal Court of Appeal have eight weeks after retirement to render any pending decisions. Even Supreme Court of Canada justices have only six months after they retire to participate in decisions in cases on which they sat. The Canadian Judicial Council has specifically pronounced that “judges should render decisions within six months of hearing a case, except in very complex matters or where there are special circumstances.”

Even with the recently time limits regulations, the Board can still keep a tariff decision pending for a long time and postpone the date of a decision presumably for years under the rubric of  “exceptional circumstances”.

Someone with a lot of patience and $5.00, might think about doing an Access To Information and  Privacy (aka “ATIP”) request seeking documentation, including names of retired members and amounts paid for post-retirement consideration of decisions in matters of which they have “begun to consider” pursuant to the open-ended provision of s. 66.5(1). The provision reads as follows:

Concluding matters after membership expires

66.5 (1) A member of the Board whose term expires may conclude the matters that the member has begun to consider.

It would presumably be very easy for the Board to provide this information. The Board has very good records going back to its inception in 1989. However, one should not be surprised if the Board were to strongly resist such an ATIP request and even spend a lot of money on outside counsel in the process.

Concluding Comments

Currently, for the first time ever, neither the Vice Chair nor the Secretary General have any legal qualifications. The appointment of the current Vice Chair expires on September 30, 2023. Moreover, there is a notable absence of common law perspective at the Board – even more so than in the past.

On a positive note, it appears that there will NOT be a Copyright Board “Town Hall” this year under the auspices of the CBA at the annual CBA IP Day.  This should be a relief for those who felt obliged to observe this unproductive ritual over the last few years that resulted in essentially nothing other than management platitudes and promises. Here is the presentation of Presentation by Nathalie Théberge, Vice-chair and Chief Executive on Practical results of the Modernization of the Board from last year’s CBA Town Hall posted some time after the fact.

The viability of the Copyright Board in the future will depend on two seemingly simple elements:

1. Collectives must propose tariffs for approval that offers good value, terms and conditions that make them attractive for users, preferably without the need for interrogatories and hearings; and,
2. The Board must develop the expertise, efficiency, and determination to approve such tariff proposals, and, if appropriate, make them even better in a short period of time measured in weeks or months and not in years and not retroactively.

If the Board can manage to expeditiously approve truly fair and equitable tariffs that offer good value and convenience and, above all, provide necessary access to sufficient repertoire, then there is a strong likelihood that such “tariffs” will be utilized with enthusiasm.

However, one can confidently expect that certain collectives, especially any with extremely limited actual repertoire and a narrow view of what constitutes necessary “access”, are busy lobbying hard for legislation to make tariffs effectively mandatory – in spite of two clear Supreme Court of Canada decisions and case law going back decades. Such legislation would be a very unfortunate move on the part of the Government – and would likely give rise to prolonged litigation.

HPK

PS – beware the forthcoming Budget on March 28, 2023 and budget implementation legislation – where we have twice seen this Government break a major campaign promise about not burying bad and irrelevant things in omnibus budget bills.

Some Comments on Retired Copyright Board Chair Justice William Vancise’s 2017 Comments

https://sasklawcourts.ca/wp-content/uploads/2021/04/William-Vancise.png

A paper published in 2018 from the Hon. William Vancise, former Chair of the Copyright Board of Canada has recently been brought to my attention by an astute copyright officer, namely Joshua Dickison from the University of New Brunswick. The paper was presented at this prestigious event at Columbia Law School in 2017.

Justice William Vancise was appointed as Chair of the Copyright Board  in 2004 and reappointed in 2009. His term ended when he retired from the Board on May 13, 2014, although he took until January 19, 2018 to render his last decision – almost four years after his retirement. The Board appears to be unique in terms of Canadian courts or tribunals in permitting this kind of delay and disincentive to render timely decisions, as I have pointed out before. The problem has still not been solved.

Ironically, shortly after his appointment, he stated that:

 “I am not at all happy with the time it takes to render a final decision. I have tried to address the issue and I can assure you it will be resolved. 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.” (highlight and emphasis added)

Judges of the Federal Court and Federal Court of Appeal have eight weeks after retirement to render any pending decisions. Even Supreme Court of Canada justices have only six months after they retire to participate in decisions in cases on which they sat. The Canadian Judicial Council has specifically pronounced that “judges should render decisions within six months of hearing a case, except in very complex matters or where there are special circumstances.”

For better or worse, Justice Vancise was often and explicitly publicly outspoken. Once again, and even more so than in his previous pronouncements, he demonstrates his sometimes contentious and  problematic views about essential copyright and Copyright Board fundamentals in this 2018 publication by:

• Reimagining and redefining the meaning of “compulsory licence” in the context of copyright law;
• By continuing and indeed amplifying his apparent lack of appreciation for the copyright contributions of the Federal Court of Appeal and the Supreme Court of Canada;
• By ignoring the fact that a Senate Committee found the Copyright Board was “dysfunctional”  two years earlier;
• By elevating the wasteful and almost useless “unlocatable” copyright owner regime to something supposedly important. To his credit, while was Chairman, Justice Vancise finally reversed years of wasted time and resources at the Board related to issuing unnecessary licences to use architectural plans for home renovation – but only after I publicly pointed out that the Board had long been oblivious for years to directly applicable Supreme Court of Canada jurisprudence; and,
• By following in the pattern of too many seasoned officials and/or politicians who have blamed the failure of their institutions on a lack of resources and calling for more resources rather than more expertise and efficiency. Once again, it must be noted the Copyright Board long had a budget greater than the Competition Tribunal. Unfortunately, the Competition Tribunal’s website has mysteriously gone from excellent to something very much less and very out of date in terms of reports, so its current budget is not readily apparent. It bears repeating that the Copyright Board has held only one actual hearing in more than last five years.

Justice Vancise admits that he came to the Board without intellectual property expertise. He states by way of introduction to this paper:

Although I am not an expert in intellectual property, I was fortunate to hear and decide cases including the transmission of music on the Internet, interpretation of the blank

media levy, making available right, and fair dealing disputes surrounding licensing

for educational institutions. The Board decides more copyright issues than any other court or tribunal in Canada.

The highlighted portion is, of course, quite wrong. The fact is that that the Copyright Board’s substantive decisions on copyright legal issues have been relatively few and very often wrong as determined by judicial review. The Federal Court, the Federal Court of Appeal, the Supreme Court of Canada and even superior courts of the provinces have been far more active and influential in terms of substantive copyright law. Moreover, he fails to accept that that the primary role of the Copyright Board is to set rates, terms and conditions and NOT to gratuitously stray from this important but narrow lane into incorrect pronouncements about such matters as deeming a device to be an audio recording medium or the effect of a WIPO treaty on Canadian legislation. Even if the statute permitted such departures from rate setting as necessarily incidental to the Board doing its job of rate setting, the Board has never had the mandate or the legal expertise to make significant and credibly correct legal rulings of this nature. Even if there is some backroom legal expertise, this only exacerbates the problem because that is not where important rulings should emanate. There is an ancient and honourable maxim that “whoever hears must decide.” The problem is exacerbated when there is a Vice Chair and Secretary General with no legal qualifications.

It is important to reiterate that the SCC has repeatedly held, and as recently as in 2022, that the Copyright Board will be held to the demanding “correctness” standard of review when it comes to interpreting the Copyright Act because it shares concurrent first instance jurisdiction with the Superior Courts. The Board will be given no deference for being “reasonable” in its interpretation of the substantive provisions of Copyright Act.

Justice Vancise is wrong that there is a need for more resources for the Board. If anything, the opposite is true. The parties before the Board are generally very competent. The Board members should decide based on the parities’ evidence and arguments – and not what they hear behind the scenes from their staff. That is NOT the way courts and tribunals are supposed to work.

Justice Vancise’s successors, Justice Robert Blair from the Ontario Court of Appeal and Justice Luc Martineau from the Federal Court have been a complete contrast by refraining from public expression of so many prolific and outspoken views. For whatever reason, Justice Blair served only one term as Chair of the Copyright Board from 2015 to 2020. Justice Martineau, retired from the Federal Court, was appointment in 2020 for a five year term. Since his appointment, there has only been one hearing and no decisions of any major consequence. Both have been extremely circumspect in terms of public comments about the Board.

Indeed, the last Board decision of any possible major consequence was the redetermination of the SODRAC tariff for CBC following the 2015 Supreme Court of Canada decision. That was decided on June 26, 2020 with Chairman Blair presiding. Most, if not all, of the tariffs and decisions since then have effectively been unopposed and unimportant. Interestingly, there have been a lot of withdrawn tariffs – perhaps somehow arising from the Supreme Court’s ruling that Board tariffs are not legally mandatory for users.

It should be acknowledged that Justice Vancise was an enthusiastic Chair of the Copyright Board and deserves credit for his attempts to constructively improve its operation. Unfortunately, his initial assurance that decisions would be rendered within six months of a hearing was not fulfilled. His frank public comments were frankly sometimes  inappropriate in terms of appreciating the role of the Federal Court of Appeal and the Supreme Court of Canada, which clearly have the power to overrule the Board when it is incorrect on substantive law. The FCA and the SCC deserve great respect not only because of their institutional role vis a vis the Board but because of the overall quality of their decisions. It is important to reiterate that, even after Vavilov, the Courts have carved out a special niche for the correctness standard of review when it comes to Copyright Board decisions, and rightly so since copyright litigation in the superior courts is affecting thousands of individuals and many very large corporations.

Whether or not it was appropriate for him to do so, Justice Vancise did speak the truth when he notes in this paper the problem with Access Copyright’s “business model” and that “The real problems are parties like Music Canada, who manipulate the copyright system..”

 The Copyright Board is headed for some interesting times and existential scrutiny, and Justice Vancise’s 2018 publication is an interesting contribution to the debates that lie ahead. It will be particularly interesting to see whether he has been only speaking for himself with his more contentious views or whether they somehow represent the ingrained institutional views of an arguably still, if not even more than ever, “dysfunctional” Copyright Board.

 More to follow shortly re the Copyright Board’s latest tinkering with procedure and aspirations for an additional $1 million a year…

 HPK

Copyright Board Annual Report 2021-2022

The Copyright Board’s recently posted 2021-2022 Annual Report (“Report”) covers the period from April 1, 2021 to March 31, 2022.

(Copyright Board)

What does this full-page collage with this uncredited photograph on page 13 the Board’s Report possibly have to do with Canada’s Copyright Board? I, for one, have no idea. But it takes up a whole page, along with several other diverting and uninformative photographs in this Report that is overall mostly devoid of any actual useful information.

That’s regrettable as the deadline for objecting to proposed tariffs looms and potential objectors have to decide whether or not to become vulnerable to potentially extremely intrusive and invasive interrogatories, expert witness costs, and huge legal expenses to deal with tariffs that the Supreme Court of Canada (“SCC”) has confirmed with crystalline clarity are NOT MANDATORY. More on this below…

The Chairman’s “Message” to the Report notes that:

The 2021‒2022 fiscal year was also marked by the Supreme Court of Canada’s decision in York v. Access Copyright, an important decision that clarifies, among other things, the scope of tariffs approved by the Board. This decision will certainly have an impact on the Board’s ability to deliver on its mandate, but it will be some time before we see the concrete results of this decision, including the cumulative effect of the decision and the changes made to the Copyright Act in 2019.(highlight and emphasis added)

The York decision from the Supreme Court of Canada (“SCC’) is, of course, the elephant in the room at the Copyright Board. It is difficult to comprehend what “concrete results” of the York decision the Board does not understand. The SCC clearly ruled that:

Access Copyright’s tariff as approved by the Copyright Board is not mandatory for users

It was unnecessary and inappropriate for the Courts below to issue a declaration about fair dealing in these circumstances

Nonetheless, there were serious errors in the Courts below noted concerning their pronouncements about fair dealing, e.g. re “aggregate” copying.

While there may be more “results” in the future, the above is already as clear as can be. The SCC decision more than “clarifies, among other things, the scope of tariffs approved by the Board”. It unambiguously declares that Board tariffs for Access Copyright are NOT mandatory and not enforceable and makes important statements about fair dealing. BTW, I was honoured to have played a very major role and to have made the prevailing arguments as counsel for my esteemed client CARL in the SCC in getting this result.

These are rulings that the Board must follow – now and not if and when the Board finally can “see the concrete results of this decision”. The Board may not like the decision – but the Board is bound by it. Even if the SCC’s statements about fair dealing are technically “obiter dicta” under the circumstances, SCC obiter dicta – especially when it is so pointed, on point, and  precise as in the instance – is as good as law.

In the past, the Board has at times appeared to be hostile to the SCC and Federal Court of Appeal. One had hoped that this had passed. I wrote here  in 2009 about how former and then sitting Board Chair Justice William Vancise expressed his frank views.

The Board cannot even bring itself to use the “M” word, i.e. “mandatory”, in relation to its tariffs  - or more precisely “not mandatory” - in this Report – which was the essence of the SCC case.

Indeed, the only place the Board uses the “M” word is:

“mandatory training required as part of organizational measures to prevent and address workplace harassment and violence”

The Board is no doubt hoping, along with Access Copyright and other collectives and content owner lobbyists, that the Government will try to undo the SCC’s York ruling and curtail fair dealing in the educational sector. That, of course, would be an enormous legislative, political, and legal mistake that will likely result in costly litigation and uncertainty for years to come. Of course, the Board would probably use such uncertainty to justify more deflection and delay and, no doubt, to demand and even bigger budget so that it can analyze the obvious.

Interestingly, although the period of the report ends on March 31, 2022, it does NOT mention the ESA v. SOCAN “making available” case that was argued in the SCC in January of 2022 and decided on July 15, 2022.  That result was another existential body blow to the Copyright Board, holding, in effect, that the Board got it very wrong in its ill-advised and very wasteful venture into international law and that the Board “will be held to the “correctness” standard of review when it comes to interpreting the Copyright Act because it shares concurrent first instance jurisdiction with the Superior Courts. The Board will be given no deference for being “reasonable” in its interpretation of the substantive provisions of Copyright Act. It must be correct. Importantly, this is the first new category of correctness review since the landmark SCC Vavilov decision.

The Report contains some interesting language about how the Board is “constrained” by decisions of the Courts. It would have been more accurate and more respectful to say that the Board is subject to  and guided by rulings of the Courts – both in the form of judicial review and other decisions that may call into question the reasonableness or even the correctness of the Board’s decisions – as was the case in the York University litigation, in which Access Copyright sought – ultimately unsuccessfully – to enforce the Board’s tariff ruling.

If the Board is to serve any useful purpose and to have a long-term future, it would do well to focus on its mandate and to stay in its lane – which is all about and only about:

• Rate setting
• Establishing tariffs that – while not mandatory – are sufficiently attractive and reflect good enough value that users will voluntarily adopt and maybe even embrace them.

I have always said that there are tariffs that are “de facto” if not “de jure” mandatory – such as those of SOCAN and Re:Sound. If you operate a radio or TV station, there is no other way to clear these music rights other than to avoid the process by playing only public domain music and public domain sound recordings. Those tariffs have mostly been fairly reasonable because there has been sufficient competent organized opposition over the years.

On the other hand, inexperienced objectors with insufficient resources to spend easily five and even six or seven figures opposing a tariff will eventually be worn down by the inevitable irrelevant and oppressive interrogatories that the Board has shown little or no commitment to curtailing. Even the AUCC (now Universities Canada) was forced to withdraw from the Access Copyright tariff case in 2012, although it might have handled the whole matter very differently.

 The major collectives have only limited interest in making the Board better. It seems that their limited interest is only in making the Board a faster and cheaper place to do business.

Many users are now going to be asking themselves whether there’s any point in getting into the quagmire and quicksand of a Copyright Board tariff proceeding at potentially enormous expense  and opening their doors to offering collectives such as Access Copyright a potential treasure trove of interrogatory material. If the Board somehow manages to come up with a tariff that offers good value, a user can then sign a licence based upon it. Otherwise, for example with Access Copyright, the user can ignore the tariff and get licences, when needed, in other more efficient ways for far better value – which is precisely what so many institutions have been doing for nearly a decade with total vindication since the Access Copyright’s “tariffs” have been declared as NOT MANDATORY by the SCC in 2021.

Collectives have almost always done very well at the Board, though not so much in the Federal Court of Appeal and definitely not so much in the Supreme Court of Canada. Board proceedings have almost always been very profitable – with the costs being borne by members and the public.

In the past, tariff proceedings were usually a bankable cash cow for collectives. One notable but apparently isolated exception was Access Copyright’s attempt to get lots of money from provincial governments, outside Quebec. I wrote about this at some lengthy back in 2015:

To recapitulate, the Board awarded a tariff of 11.56 ¢ per FTE (full time equivalent) for the period 2005-2009 and 49.71 ¢ per FTE for 2010-2014. That’s less than 1% and about 2% respectively of what AC asked for.  According to the Board, the tariff will generate a total of only about $370,000 over its ten year period – which is likely only a small fraction of the costs involved in obtaining the tariff.

Here is that decision, interestingly with Justice Vancise as chair of the panel, which hopefully will be kept in mind by all concerned as Access Copyright attempts to impose a tariff for 2024-2026 for post-secondary institutions as follows:

(a) $15.65, if the educational institution is a university; or

(b) $6.01, if another educational institution.

The 2021-2022 Report contains virtually nothing new or interesting. Is all about management platitudes, e.g.:

Expected Outcomes

The Board strives to be a credible institution, well-respected both by the creators and the users of copyrighted material, because of the efficiency of its operations and its unique expertise in copyright matters.

It has adapted and will adapt with resilience and agility to the challenges posed by a constantly evolving legal and economic environment, whether at the national or international level, while offering high-quality support to parties and the public requesting its services.

The never ending tinkering with procedures – such as requiring “grounds” for new tariffs and objections at an early stage – is simply obvious and won’t change anything. The requirement for “fair and equitable” tariffs is hardly new – what else has the Board and its predecessor supposedly been doing for the last eight decades?

Bottom line:

The vast majority of the “tariffs” approved by the Board are no brainer unopposed rubber stamp exercises that somehow still take a very long time.

The unlocatable owner regime is an embarrassing waste of time and resources. Hopefully, it doesn’t still consume a whole FTE resource as then Chair William Vancise confirmed in 2014. With only one  inconsequential rulings visible in the 2021-2022  reporting period, it would be difficult to understand how this took more than a very few hours at the most to deal with. The Copyright Act could be amended to deal with these increasingly rare situations as an exception along with other specific exceptions.

The Board is continuing to try to justify itself as an important and essential quasi-judicial tribunal, which it once was. However, it has failed to clearly get beyond the “dysfunctional” description conferred by a Senate Committee in 2016 and continues to be an expensive and unproductive though paradoxically high profile presence in the Canadian administrative tribunal landscape. It has held only one hearing in the last five years.

Its proposed new Rules of Practice and Procedure will likely accomplish little or nothing – other than to provide an excuse for the Board to demand an additional $1 million a year to its already inflated budget:

The costs of the proposal are expected to be less than $1 million annually. While Parties would be required to provide information earlier on in proceedings, the amount or type of information required from Parties would be the same as under the current Model Directive. (emphasis added)

If the Board is to have any credibility and serve any useful purpose going forward, it needs competent, independent and balanced management with legal expertise in both civil and common law and – of course – in copyright law. The Board’s Members should, of course, reflect these requirements.

It’s really too bad that the ISED Minister @FP_Champagne seems to be apparently 100% missing in action on what is going on here – although it’s 100% his responsibility.

Happy Holidays to one an all!

HPK