What does "educational" mean?

Many are rather nervous about the implications of including the word "education" in the proposed revision of the fair dealing provisions of Canada's Copyright Act. The big question, of course, is what does "education" mean?

The Federal Court has just rendered an intriguing decision that holds that a thesaurus is indeed an "educational text book" for purposes of Corrections Canada regulations. The fact that Roget's Thesaurus is not "required reading" for an inmate's National Sex Offender Maintenance Program or that it is available in the prison library does not take it out of the realm of being an "educational text book."

Corrections Canada had denied the inmate the right to buy the book because it ruled that the book would have put his allowable personal property limit over $1,500 - and was not considered to be exempt as an "educational text book."

Justice Sean Harrington's decision is delightful to read - quoting both Humpty Dumpty and Justice Scalia. And it is actually important to read this decision because it could be the the harbinger of what is to come in terms of debate about the "educational exception" and litigation should it be enacted without further clarification.

Interestingly, the Copyright Board ruled earlier in this year that providing copies of material that is prescribed or required reading cannot not be considered as fair dealing in the context of Access Copyright’s K-12 tariff. This was upheld by the Federal Court of Appeal. We will know by the end of the month whether CMEC will seek leave to appeal this decision to the Supreme Court of Canada. In my opinion, it is essential that leave be sought in this instance and that there is a good chance that leave would be granted in this case, as I have said earlier. (I acted for the intervener CAUT in this case the judicial review).

BTW, congratulations to inmate Ken Mackay who represented himself and prevailed against two Department of Justice Lawyers. He was even awarded $200 in costs - which should help him to build up his library as he serves his life sentence.

HK

The "Education" Exception: Toronto Star Editorial of August 14, 2010 re "Copyright Bill Needs Change"

The Toronto Star had an uncharacteristically ill-informed and misguided editorial on August 14, 2010 about copyright entitled Copyright Bill Needs Changes on its otherwise usually solid editorial page. One can only wonder about where The Star got its information from this time. It said:

Writers and publishers are worried that a broad interpretation of “education” could lead to rampant copying of textbooks, instructional manuals and even novels. Would a school board be allowed to buy just one copy of a new textbook and copy it for all its students? Would universities be allowed to copy bits and pieces of 20 different books to compile reading material on a certain subject for their students? Indeed, would a monthly book club be considered an “educational” activity and be allowed to copy novels on its reading list?

It concluded:

Both government and opposition should rethink and take a hard look at the fair dealing section when Parliament resumes sitting in the fall and Bill C-32 goes to committee. Legislation intended to defend copyright ought not to be used to justify rampant copying.
(emphasis added)

There is absolutely nothing in the bill that would "justify rampant copying". Indeed, as the bill now stands, it would effectively prevent all kinds of legitimate copying through its repressive and regressive digital locks provisions and its inadequate fair dealing provisions that would leave Canadian educators, students and consumers still worse off in important ways than their American counterparts.

I wrote a letter to the editor on August 16, 2010 which hasn't yet been published. Nor have I seen any other letters about this editorial, though it's hard to imagine that there were none worthy of publication. Hopefully, The Star will get around to them. In the meantime, and in any event, my letter read as follows:

Dear Sirs:

Your editorial about copyright on August 14, 2010 is inaccurate, inflammatory and seriously misleading.

Nothing in Bill C-32 would allow a school board “to buy just one copy of a new textbook and copy it for all its students”. To suggest that a monthly book club “would be considered an “educational” activity and be allowed to copy novels on its reading list” is simply absurd. As for universities being “allowed to copy bits and pieces of 20 different books to compile reading material on a certain subject for their students”, the fact is that “coursepacks” are perfectly legitimate and have been used for decades. Universities are paying estimated license costs well in excess of $10 million a year for making them. Moreover, there are often unnecessary payments because rights have already been paid for, because the material was in the public domain or the Creative Commons, the excerpt was insubstantial, or the use was clearly fair dealing. Access Copyright, the English Canadian collective that has done so much to inhibit or charge for “access”, has been eagerly collecting this money. Indeed, it now wants to increase its charges to $45 per student per year based in large measure on rights it does not have and for repertoire in which it has no legal interest.

Copyright revision is already complex and controversial enough without this kind of ill-informed and misguided opinion. Next time, please check the facts before you take sides in such an important debate.

Howard Knopf

Barrister and Solicitor

Macera & Jarzyna LLP

Ottawa, Canada

HK

SOCAN "PREVIEWS" - A Preview of its Friday the 13th Leave Application?

Tomorrow, Friday the 13th of August, is the deadline as I calculate it for SOCAN to file its leave to appeal ("LTA") application to get this decision from the Federal Court of Appeal ("FCA") on iTune type "prveviews" heard by the Supreme Court of Canada.

The main issue in that case - and it's quite important - is whether the Federal Court of Appeal got it right when it said on May 14, 2010 in para. 22:

SOCAN argues that the primary purpose of previews is not research, but rather increased sales and, accordingly, increased profits. There is no doubt that, for the seller, this is an important objective, one which also benefits copyright holders through reproduction and performance rights. I agree. But this does not exclude other equally important purposes. We must consider previews from the point of view of the person for whom they are intended: the consumer of the subject-matter of the copyright. Their purpose is to assist the consumer in seeking and finding the desired musical work.

(emphasis added)

This decision was put before the same Federal Court of Appeal (different panel) by yours truly in the June 8, 2010 hearing of the Province of Alberta et al ("CMEC" ) v. Access Copyright K-12 decision, also on judicial review from the Copyright Board. I submitted to the FCA on behalf of the intervener CAUT that if the research purpose of a consumer of iTunes songs must be considered, then so should the research or private study or criticism purpose of students. The FCA did not accept this and didn't even refer in their July 23,2010 decision to the SOCAN decision from their colleagues on the FCA three weeks or so before the K-12 hearing.

Frankly, I think that there's a significant inconsistency here between these two decisions within less than three months of each other of different panels of the FCA .

There's also a significant irony that could play out in the next months. SOCAN's LTA application by itself may not be extremely compelling to the SCC. Only about one ten leave to appeal applications succeed. Here, we have a decision where the FCA upheld the Copyright Board and the result is not clearly wrong or unreasonable. Besides, the SCC has heard a lot of copyright cases in the last few years.

However, when different panels of the FCA come to apparently inconsistent conclusions within a few weeks of each other on an important issue arising from two cases from the Copyright Board, the situation may become much more interesting and even compelling to the SCC. This is especially so given the apparent resistance in certain influential quarters to the main messages of the 2004 CCH v. LSUC decision from the SCC.

Not only politics but the law can make strange bedfellows. In this instance, both SOCAN's and CMEC's attempts to get leave to appeal will very likely reinforce each other, assuming that they both seek leave.

SOCAN will file tomorrow, according to what I've heard.

I have no idea whether CMEC will seek leave, and it has until the end of September to do so. In my view, CMEC's decision merits a leave application on its own, and given the above, it would be very surprising if leave were not to be sought by CMEC, whose loss is presumably vastly more economically significant than that of SOCAN in this instance. But SOCAN's LTA application could only help CMEC's, and vice versa.

Given the apparent inconsistency of the FCA case law, not to mention the Coypright Board's own approach, and the vast amount of money at stake in Access Copyright's K-12, and current proposals affecting provincial govenments and post secondary institutions, there are some issues that would seem clearly to be of "public importance" and require resolution, clarification and finality that the Copyright Board and the collectives appearing before it can understand and will follow.

So - good luck in this case to SOCAN on its expected Friday the 13th LTA application.

HK

Access Copyright’s excessive $45 per university student proposed tariff - August 11, 2010 deadline

This is the first in more to come about the proposed $45 per university student tariff - a more than 1,300 % increase over the current basic charge. Access Copyright (“AC”),the proponent, is probably Canada’s fastest growing and least understood collective. It started out as a reprography collective right after the 1988 reform package was proclaimed. Its initial cash flow came conveniently from a lucrative multimillion dollar contact with the Federal Government. It has since managed, with little effective resistance, to convince Canadian provincial governments, school boards, colleges and universities to pay well over $30 million a year into its coffers. The only actual Copyright Board challenge to date that has gone to fruition resulted in a big loss for the K-12 school boards and the provinces ultimately behind them under the umbrella of the Council of Ministers of Education, Canada (“CMEC”). This loss was recently confirmed by the Federal Court of Appeal. More about this and whether this case will go to the Supreme Court of Canada below.

But reprography is becoming obsolete and AC has already decided to move on to “digital”. This ought to be interesting because, in addition to certain other potential serious problems, AC lacks digital rights from a lot of creators and publishers who have been understandably reluctant to involve third parties such as Access Copyright.

Here’s a good piece on AC’s problems in terms of future legislation and its attempted incursion into digital rights by Gary Rodrigues, a former Co-Chair of AC when it was known as CanCopy.

AC also wants to push back on the CCH v. LSUC decision from the Supreme Court of Canada. It has won a temporary partial but significant victory on this front in the Board’s K-12 decision and the recent Federal Court of Appeal decision upholding it. But that may not hold and AC has been understandably muted about its victory proclamations.

Now, AC wants to impose a $45 per head digital, etc. tariff on post secondary students at universities and $35 at colleges. The date for filing an objection is AUGUST 11, 2010. Lots of people and institutions may wish to object. How to do so is explained below.

$45 is not a misprint. Moreover, it’s more than 13 times the current base amount per student. The good news, as if anyone would possibly see it that way, is that it’s all inclusive and doesn’t require the intensely disliked $0.10 per page course pack fee. That’s not really much of a concession since the use of photocopied course packs is rapidly becoming obsolete, rather like blank CDs. The future lies in e-reserves and other legitimate uses of the new technology that could soon make Access Copyright itself obsolete if universities decide to exercise their technological and legal options.

The bad news is that this figure is exorbitant and AC is arguably not entitled to much if not most of this money. It is seeking to charge for all sorts of uses that are simply not covered by copyright law or which are or should be regarded as fair dealing according to the Supreme Court of Canada’s landmark decision in the 2004 CCH v LSUC decision. AC also has serious “repertoire” and rights problems, discussed below. AC wants educators and students (i.e. taxpayers) to pay for much stuff and uses that are or should be free, if the law is properly understood and applied. And, as indicated above, AC may have a big gap in terms of digital rights in the very limited actual repertoire that it has in its system. I will, at a later date, blog about its other “repertoire” problems for those who have not read my analysis published about a decade ago.

There is no comparable tariff or other mechanism in the USA to the proposed digital tariff.

Incredibly, the tariff defines a “copy” to include “posting a link or hyperlink to Digital Copy”. So, that would presumably include any website with copyrighted material. For example, take this blog - please! AC apparently expects to be paid whenever a professor posts a link on his or her website to my blog, or Michael Geist’s blog or the Globe and Mail or eBay. That is simply absurd.

Merely linking does not create liability. If it did, the entire internet would grind to a halt instantly. The whole raison d’être of the world wide web is “linking.” Linking requires neither permission nor payment. The Copyright Board should not even consider the issue of “linking”, because it is not covered by copyright law. This issue is a non-starter and should be eliminated as soon as possible by the Copyright Board before a lot of time and money is wasted on it.

The same for “displaying” a copy on a computer. How, precisely, is one supposed to read anything otherwise? The concept of “display” does not occur in the Copyright Act, other than in connection with dry erase boards.

Of course, in the university context, much or most of the remaining uses will be for a purpose covered by fair dealing under the current s. 29 of the Copyright Act - i.e. research, private study, criticism or review.

Or, these uses will simply be permitted by virtue of an “implied license.” When someone posts a work on the internet without any technical barrier to printing, saving, emailing it, etc. there is very arguably an implied license to do those things (notwithstanding CMEC’s views to the contrary) and most if not all of the other things that AC purports to cover.

The Copyright Board has shown itself to be quite sympathetic to AC in the K-12 matter, which was the first AC file to actually result in a contested hearing at the Board. The Board more than doubled the previously negotiated rate, despite the Supreme Court of Canada’s CCH decision, which was not adequately considered by the parties or the Board - although there was more than sufficient time to do so. The hit on the school boards was enormous. As I blogged last summer:

There will be a whopping four year retroactive liability here of about $18 million a year starting in 2005-2006. That's about $72 million to date, of which about $40 million is additional to what was already presumably being paid at the old rate, allowing for a token discount of 10% to soften this blow. It'll be really interesting to see what AC does with all of this. Almost two of this four year period involved waiting for the Board to issue its decision after the hearing concluded. In fact, most of the hearing took place in June, 2007 with some follow up delayed until October of 2007 due to the illness of a key AC witness.

This at a time when school boards are desperate for money for far more useful and immediate purposes.

The Federal Court of Appeal (FCA) has decided on July 23, 2010 a judicial review case involving this decision, in which I represented the Canadian Association of University Teachers (“CAUT”). Here’s CAUT's response to that decision.

All I will say at this point and, as is always the case here on this blog, in my own my own personal capacity, is that leave to appeal to the Supreme Court of Canada should be sought by CMEC if for no other reason than this decision appears, in my view, to be fundamentally inconsistent with a decision of different panel of the FCA a few weeks earlier. In the May 14, 2010 SOCAN “Previews” case wherein it was held that the research purpose of the consumer of the user or consumer must be considered:

We must consider previews from the point of view of the person for whom they are intended: the consumer of the subject-matter of the copyright. Their purpose is to assist the consumer in seeking and finding the desired musical work.

Substitute “student” for “consumer” and the issue should be quite apparent. However, the Court in the K-12 decision did not even refer to the previews decision, concerning which ample submissions were made. There are also several other grounds for seeking leave to appeal - but I won’t deal with them here.

There can be no doubt that AC will use the Copyright Board’s K-12 decision and the recent FCA decision as spring board’s to achieve a good chunk of what is being sought in the proposed post-secondary tariff.

The proposed $45/year tariff would also require extremely onerous record keeping obligations on the part of the institutions, and privacy and operationally invasive rights to conduct surveys. Not to mention invasive audit rights concerning which CCRA (Canada’s tax collectors) would be envious. This would give a whole new level of irony to the term “Access”. Even professors’ emails must be recorded and reported.

There are about 1.5 million students registered in universities and colleges in Canada, most of whom are borrowing heavily to finance their careers and Canada’s future in scholarship and innovation.

AC wants to take $45 per year from each of university students and $35 for each of the college students per That’s about $60,000,000 a year for those who keep track of taxpayers’ money. That’s in addition to the retroactive windfall of tens of millions of dollars in addition to what had already been paid during the period b given to AC last year by the Copyright Board for K-12. That figure doesn’t include colleges. With actual and potential revenue figures like those above, it’s no wonder that AC can easily budget over $3.1 million for lawyer and other “professional fees” for 2010 as revealed at AC’s recent AGM. That goes a long way, even at the Copyright Board.

Think of all the advanced research chairs or library books that could be bought for these tens of millions of dollars. That might create real innovation.

There is no comparable regime in place in the USA to impose similar restrictions, bureaucracy, copyright chill and costs on the K-12 and post secondary educational systems. American law has codified such that most if not all of the copying activity in schools and on campuses is “fair”, including the use of multiple copies in the classroom. While the FCA clearly did not agree with this approach, hopefully the Supreme Court of Canada would do so if given the opportunity.

What should be done about the new proposed $45 p.a. annual “tax” on university students?

If this hearing follows the usual course, it will take several years to unfold, will cost several million dollars in legal fees, surveys, etc. and result in a fairly predictable amount of $23-$26 per year per student - more or less the average of the overreaching amount sought and the previous basic amount paid. Some of the more outrageous “rights” would be dropped as well. Both sides would claim victory.

However, that would hardly be a victory if the end amount should really be more like $2 per student - or maybe even much less - which is not unreasonable in a post CCH and mostly digital and networked world.

I understand that the Association of Universities and Colleges of Canada AUCC has decided to fight the tariff at the Board. Others are expected to file objections and it is important that this be done in order to ensure that all possible arguments are made at the Board hearing stage and that the record before the Board is as adequate as possible. Part of the problem in the K-12 decision was that the record was inadequate. Even according to CMEC, which represented the K-12 school boards, the basic underlying survey should have been done “differently” in light of the CCH v. LSUC, which it did not fully take into account when the survey methodology was agreed to. While objectors other than AUCC may have limited direct input or control into the expected mega-survey, they should arguably be given an opportunity to comment on the adequacy of the proposed methodology.

People and institutions contemplating objection should understand that:

1. there are no “costs” consequences in terms of the other sides’ legal costs when filing an objection at the Copyright Board, even if one later withdraws.

2. The sometimes controversial “interrogatory” process at the Copyright Board can only be used to demand production of relevant information. And it works two ways.

Thus, a number of institutions, and even interested professors, students, librarians and other interested members of the post secondary community may wish to object. In the private copying cases, there were as many as 3,500 objections.

Canadian teachers, students, post secondary administrators and taxpayers should not want to unnecessarily pay tens of millions of dollars per year to exercise rights that they already have or do not need or don’t even exist, or that AC may not be entitled to enforce. Our educational system cannot afford such inefficiency.

Bill C-32, even if passes with the word “education” included in s. 29, will not necessarily solve any problems here. Given the Copyright Board’s rulings to date on what is “fair”, and the FCA’s reluctance to interfere, the legalisation needs more clarity - such as the “such as” wording we see in the USA and an explicit reference to “multiple copies.” Besides, waiting for Parliament to enact copyright legislation may be like Waiting for Godot. The educational community has been “waiting” for adequate exceptions since Flora MacDonald promised them in the “fall” - of 1988.

The Supreme Court of Canada may provide the necessary clarity in this situation as it did with the legal research issue. However, we must wait upon CMEC to see whether it will seek leave to appeal and whether such leave will be granted. There is a good chance here that leave would be granted, if sought, because the K-12 decision of the FCA seems inconsistent with the SOCAN previews decision of a few weeks earlier and rumours are strong that SOCAN will also seek leave. It would seem very important that this discrepancy be resolved. The Supreme Court of Canada sometimes likes to hear cases that come in contrasting “pairs”. In this case, the cases are from different panels of the same Court.

The Copyright Board seems to have an unstated “rocket docket” policy when it comes to AC. One can see this not only in the previous K-12 file but the currently unfolding attempt by AC to get $24 per FTE provincial government employee. Important decisions are likely to be made at an early stage, even while events are brewing in Parliament and the Courts that could and should provide game changing developments. Given AC’s very substantial revenues of well over $30 million a year even before the K-12 windfall, there would seem to be no need to move too quickly on the post-secondary file. That is why, in this case, additional voices may be needed to make these and other points.

How does one file an objection? It’s quite simple:

• Fax it or email it to:

GILLES MCDOUGALL

Acting Secretary General

56 Sparks Street, Suite 800

Ottawa, Ontario

K1A 0C9

613-952-8624 (telephone)

613-952-8630 (fax)

gilles.mcdougall@cb-cda.gc.ca (email)

• Indicate who you are and generally and why you are objecting - i.e. if you think that the amount sought is excessive and exorbitant, that AC is seeking to license rights it doesn’t have in respect of repertoire it doesn’t have, etc.

• You don’t need any detail. Details come much, much later. Anything much longer than one or two pages is longer than necessary at this stage. And details at this stage won't have any effect on the outcome. The objection is simply a necessary step to full participation.

• Provide your full contact information.

Note that the Board’s Model Directive on Procedure can be found here.

DO SO ON OR BEFORE AUGUST 11, 2010.

BTW, I should disclose that I am a member of AC and I do cash their little cheques each year, and hopefully redistribute the sum to good causes. However, I and many AC members - at least those in the academic and professional communities - would happily write what we write with or without this payment and would happily see this amount substantially reduced or eliminated if AC’s tariffs were to be substantially cut down to size for the benefit of the Canadian educational system, which is spending tens of millions of unnecessary dollars each year, not to mention the bureaucratic costs and the chill factors inside the educational system which are so significant that they are “priceless”.

The largest single creator beneficiary of AC’s mechanism has received about $7,000 per year, a figure which falls off very quickly, according to the 2007 Friedland report. So, whatever the purpose of AC may be, it is not doing a lot to keep individual writers writing. And that’s a very tiny fraction of the $3.1 budget for legal costs alone for 2010.

HK

PS - the above has provoked a huge and interesting discussion at Michael Geist's blog and at Techdirt.

Is the SAC proposed internet music "tax" a stalking horse for SOCAN?

(Above:Upper is Eric Schwartz/Bluepower.com & lower is Eric Baptise/SOCAN)

Eddie Schwartz is renewing his call for a "reasonable monthly licence fee" that would legalize the file sharing of music and "create a new business model that would be fair to consumers and creators alike". Here's his op-ed from July 30, 2010 in Straight.

He says that:

"The revenue received could be distributed to performers, songwriters, and rights-holders on a transparent, pro-rata basis by one of Canada’s respected music collectives, such as SOCAN." (emphasis added)

He is SOCAN's representative in Nashville, a fact which is also stated at the close of the Staight op-ed.

His proposal for a double negative option music "tax" (as it would inevitably be called) on internet users is itself not new. I've written about it before at some length just over a year ago here.

As I said then about the proposed monthly fee of about $5 or so:

This apparently modest fee - less than a pint of draft beer these days - would be added to their ISP bill. It would generate about $900 million a year in Canada, based upon SAC's admittedly “back of the envelope” calculations. (BTW, that’s about 4.5 times more than what SOCAN now collects - and it’s taken SOCAN and its predecessors more than 80 years to get to that level). Sure - SAC admits that $5 is just a figure for discussion purposes and they could cut back to $3 a month - a mere $600 million. Sometimes, you gotta walk before you can run.

It would likely quickly morph into a mandatory "tax", since it's hard to imagine the participation of a sufficient number of internet users and rights owners, even on a supposedly voluntary negative option basis, to enable this unprecedented scheme to begin to function. It would also be in addition to the much disliked "tax" on blank media. The current Government, to its credit, has explicitly resisted efforts to extend this blank media "tax" to iPods and other innovative devices, calling the idea "totally nonsensical". There was no ambiguity in Minister's Moore's famous tweet and Minister Clement's rapid response quoted here.

Eddie is an extremely articulate guy, a great communicator and has always seemed to choose his words carefully. He has been a Director of SOCAN and very influential in promoting the interests of pop songwriters in that organization and elsewhere. I wonder if he is now speaking for SOCAN, or at least acting as a stalking horse?

Earlier this year, SOCAN took the certainly unusual and probably unprecedented step for a Canadian collective of going outside of Canada for its next CEO. It chose Eric Baptiste from France, who has very impressive qualifications, including a 12 year career at the International Confederation of the Societies of Authors and Composers (CISAC), the World Federation of Copyright Societies with 225 member societies in 118 countries, where he had been Director General since 1999. Prior to joining CISAC, he had notable successes in the French broadcasting industry.

One can only assume that the very accomplished, upwardly mobile, and apparently still young M. Baptiste must have been offered a considerable inducement and very interesting challenge to move his career from Paris, France to suburban North York, Toronto, Ontario. On January 19, 2010, SOCAN issued a press release that included the following:

"I am delighted with the selection of Eric as my successor," says André LeBel, CEO, SOCAN. "He has all it takes to take SOCAN to the next level."
(emphasis added)

Could that “next level” be what Eddie is talking about?

HK

Exit Strategy for Digital Locks Dilemma of Canada's Bill C-32

(Harry Houdini in 1899 - Wikipedia)

Pressure mostly from the American entertainment industry and, as a result, the US government itself has got Canada locked into a very divisive battle over digital locks. While there was cause to hope that the "made worse in Canada" DMCA-like provisions of Bill C-61 might be more balanced in the next bill, Bill C-32 proved to be a big disappointment in this respect. This issue has once again threatened to block progress and passage of copyright reform in Canada. Now, two extremely important authorities in the US have provided the exit strategy and tools to enable Ministers Clement, Moore and the PMO to escape from the digital and political conundrum into which they were locked with time running out before a possibly sooner rather than later election.

The United States Copyright Office, which is part of the Library of Congress, is about as independent as a government organization gets to be in the Washington government structure. It has immense prestige, power, and influence in copyright matters - both domestically and internationally. Under its remarkably competent and balanced succession of Registers, currently Marybeth Peters (soon to retire) and her predecessors such as Ralph Oman (who was instrumental in bringing the US into Berne), David Ladd, and the late Barbara Ringer who was greatly influential in the monumental 1976 legislation, it has shown itself to be fair, erudite and devoted to consultation, consensus where possible, and research and evidence based rule making within its mandate. Officials whose sympathies were too pro-industry have tended to leave to pursue careers as lobbyists. Those who have stayed have done a great job overall and are a real credit to the legal and governance professions, as well as those who have appointed them. Nobody could possibly see the US Copyright Office as “radical extremist” or “copy-left” when it comes to copyright policy.

Here is the Copyright Office’s recent fair and balanced rulings on various DMCA related issues allowing exemptions for such practices as cell phone “jail breaking” (which goes way beyond simple unlocking) and copying of DVD excerpts, both of which would be illegal under Canada’s proposed Bill C-32.

The recent ruling also allows for circumvention of eBook digital locks when when all existing ebook editions of the work (including digital text editions made available by authorized entities) contain access controls that prevent the enabling either of the book’s read-aloud function or of screen readers that render the text into a specialized format. This was a close call, since the Register (with apparent reluctance) recommended against this exemption this time around on the basis of a lack of evidence presented by the proponents. Interestingly, the Librarian of Congress himself, James Billington, overruled her and continued the previous exemption granted in 2006.

Ironically, not only are the exemptions far more generous to users than what is proposed in Canada’s Bill C-32. The much disliked DMCA at least allows for exemptions based on fair use principles. Bill C-32 makes is absolutely clear that anti-circumvention protection for DRMs and TPMs trumps fair dealing in Canada.

While Bill C-32 does make provision for regulations that could be made to provide exemptions in some very limited circumstances, that is no answer to why Canada would start out with far harsher anti-consumer, anti-user and anti-innovation legislation that the USA now has. Michael Geist's Toronto Star column talks about this today.

Nor is the United States Fifth Circuit Court of Appeals, which has just upheld a district court ruling on DMCA circumvention that is far more generous to users than Bill C-32, an example of a “radical extremist” organization. Texas districts courts are not known for being very “user friendly” on IP matters.

Here’s the ruling that will upset pro-digital locks lobbyists no end. It confirms the legality, even under American DMCA law, of users’ rights in respect of anticirumvention behavior that would clearly be illegal under Canada’s proposed Bill C-32.

The ruling states:

However, MGE advocates too broad a definition of “access;” their interpretation would permit liability under § 1201(a) for accessing a work simply to view it or to use it within the purview of “fair use” permitted under the Copyright Act. Merely by passing a technological protection that restricts a user From viewing or using a work is insufficient to trigger the DMCA’s anti-circumvention provision. The DMCA prohibits only forms of access that would violate or impinge on the protections that the Copyright Act otherwise affords copyright owners.

(emphasis added)

Despite this quite clear language and the fact the appeals court upheld the district court and the fact that General Electric (hardly an “enemy of copyright” or a “radical extremist” - it has filed 20,000 patent applications in the last decade) was the successful defendant/respondent, it should be noted that a well known Canadian lawyer who has been a lawyer and/or lobbyist for the Canadian trade associations that represent the American recording and motion picture industries has gone so far as to disagree with this ruling. Not surprisingly, he also criticizes Michael Geist’s perfectly reasonable, succinct and timely summary of it. It will be interesting to see what expert American expert scholars and lawyers who are not lobbyists have to say about this decision.

All of this should come as great news for embattled Government Ministers Clement and Moore. It shows that even the very prestigious, powerful and influential United States Copyright Office and the very important and usually very IP friendly Fifth Circuit Court of Appeals do not have the slightest concerns about such issues as spurious and misleading red herrings about international law and the 1996 WIPO treaties raised by certain lobbyists and some associated with them with respect to Bill C-32 in Canada. One can be quite confident that if such arguments had any weight, they would have been made in these US proceedings. The Copyright Office did consider the WIPO treaties and was clearly not distracted by them. If the WIPO treaties were raised in the 5th Circuit, the Court was clearly not the slightest bit impressed and doesn't even mention them.

These very important and virtually simultaneous American developments provide a great exit strategy for Ministers Moore and Clement on Bill C-32, which Minister Clement, the lead Minister on this Bill, has clearly already perceived.

As it happens, Minister Clement is also much embattled on the census front. Ironically, the arguably minimally intrusive privacy implications of the mandatory long form census pale in comparison to those of the Bill -32.

Bill C-32 will expose Canadians to massive commercially and quite possibly criminally motivated privacy invasion by protecting the invasion tools but preventing Canadians from easily and effectively protecting themselves from the countless ways in which the most intimate information about their reading, listening, browsing, book buying, hobbies, innermost thoughts, and other personal information can be harvested, sold or otherwise abused against their free and informed will. This is seriously a crucial privacy issue - and, with all respect, much more so than the number of bedrooms or bathrooms in ones’ house, which is readily available public information anyway.

Minister Clement (whose is the lead Minister on Bill C-32) has been the nice cop on the DMCA anticircumvention issue. It has fallen to Minister Moore who, for whatever reasons, has taken the unpopular side of the US entertainment industry, to defend that the air tight digital locks provisions. These provisions jeopardize the viability of the whole bill - even without the above developments.

Now both Ministers (particularly Minister Moore) and the doubtless interested PMO have a graceful and convenient exit strategy made available to them by fate, the US Copyright Office of the Library of Congress and the US Fifth Circuit Court of Appeals.

There is no reason why Canada would want to enact a law that is contrary to the interests of Canadian consumers, copyright users, educators, innovators and creators themselves for the benefit of the luddite faction American entertainment industry when US law itself has been authoritatively interpreted in a far more "large and liberal" user friendly manner than Bill C-32 would provide.

Now that Canada has been handed the keys to unlock itself from the digital locks dilemma, hopefully, we can at last get on with some serious, balanced and long overdue copyright reform that will operate in Canada’s interest and be fully consistent not only with international law but even international law as authoritative American sources see it.

Then, let's see who the real "radical extremists" will be who will oppose copyright reform. Access Copyright has already declared itself here and here and elsewhere for starters. The next in line will predictably be CRIA and CMPDA, and organizations that they have managed to influence up till now on the copyright front.

HK

Muffin Maven Muzzled

The Washington Post reports that a US Appeals Court has confirmed that "A food-industry executive armed with the secret to the "nooks and crannies" in Thomas' English muffins can't work for a rival amid a trade-secret lawsuit."

Thomas' English Muffins is owned by Bimbo Bakeries. The former Thomas/Bimbo exec wants to work for Hostess in Houston.

As the Third Circuit Court of Appeals noted:

Significantly, as Bimbo repeatedly has noted throughout these proceedings, Botticella was one of only seven people who possessed all of the knowledge necessary to replicate independently Bimbo’s popular line of Thomas’ English Muffins, including the secret behind the muffins’ unique “nooks and crannies” texture. Thomas’ English Muffins is the source of approximately half a billion dollars worth of Bimbo’s annual sales income.
(emphasis added)

I would imagine that the muffin maven is mighty miffed.

HK

PS - it seems that there isn't much that is "English" about Thomas' English Muffins other than that the baker who started making and selling them in New York in 1880 emigrated from England in 1874, according the the New York Times.

Indeed, according to the Boston Globe, "There may not be a single "English Muffin" in all of England".

That being said, I would imagine that "English Muffins" won't be pushed as geographic indication by the EU.

ACTA "intercessional" [sic?] meeting in Washington, August 16, 2010

It seems that there will be an "intercessional" [sic?] ACTA meeting in Washington, D.C. on August 16, 2010.

Either somebody (USTR?) can't spell or this is a great pun or Freudian slip.

"Intercession" usually has religious significance, i.e. see here and here, i.e. in the sense of mediating between two parties who can't agree, which seems to be the situation these days between the US and the EU over ACTA, which both parties are pursuing with religious-like fervour but also with fervent disagreement over just how excessive and aggressive the agreement should be.

Whether this will be an "intercessional" or "intersessional" meeting, apparently the meeting will be only between the USA and the EU, with the less important countries, in their view, such as Canada not invited.

Speaking of religion, I guess that "They also serve who only stand and wait..."

HK

Speaking of Statistics (and Copyright Blogs)

Not surprisingly, IPKat shows up yet again as the "first in show" copyright blog this week according to the Copyright Litigation Blog.

Congratulations to my dear friendly felines - Jeremy (the wise and wily tom cat), Annsley, Tufty and all the other Kats and Kittens...

No doubt their otherwise well deserved popularity this week was not diminished with this deceptively misdescriptive (though only barely) but still somewhat salacious blog about the "Naked Truth" of American trade marks litigation involving a cow boy, cow girl. and guitars.

Curiously, my little Canadian blog, lately rather neglected by the undersigned, apparently came in at number 11 around the world.

This is interesting, especially since neither this blog nor that blog were even mentioned.

There's an old adage about lies, damn lies and statistics - the latter of which is a hot topic these days in Canada that has even reached the New York Times. The Canadian long form census debate is ironically related to to copyright policy and the debate unfolding on Bill C-32. This is because of the air tight protection for DRM and TPM measures in Bill C-32 and the inadequate protection from their privacy invasive potential. See here on this blog a few days ago.

In order to achieve more reliability on copyright blog readership statistics, we really should consider including one or more questions on the mandatory Canadian census - if it survives - about blog reading habits so that Canadians can know the real truth about who reads what and why...

To certain readers who occasionally take this blog, including its title, too literally - part of the foregoing is tongue in cheek. But only part. If you can't guess which part, you need help!

HK

Bratz Beats Barbie

(The Telegraph)

Here's a remarkably witty and wise decision from Chief Judge Alex Kozinski of the US 9th Circuit - famed for his often colourful IP decisions.

He overturns Mattel's early victories in this epic case on many grounds, not least important of which is the classic idea v. expression issue.

His bottom line and his last line indicate the frequent reluctance of the experienced IP judiciary to let copyright law be used to stifle otherwise legitimate competition:

America thrives on competition; Barbie, the all-American

girl, will too.

HK

The Privacy Policy Paradox - Census and Copyright Contrasted

(Slyck)

There is a certain paradoxical irony in the coincidence of the debate over abolishing the mandatory long form census form and Bill C-32 on copyright revision in Canada.

The current census proposal reflects a commendable desire, in principle, to cut back on the “nanny state” notion of society, with a “less is more” approach to the role of Government. Interestingly, many groups are resisting this initiative in this instance, calling for the keeping of the long form because the minor inconvenience and the minimal privacy implications are, in their view, worth the benefit of the important information that will be collected.

Moreover, according to Jennifer Stoddart, the Federal Privacy Commissioner, only three complaints have been filed in the last decade about the long form census.

Likewise, most Canadians favour strict regulation of banks and the environment, because the costs and interference with “property” are well worth the benefits. Even Alan Greenspan now believes in regulation.

Segue to Bill C-32, which ironically is clearly an example of major Government intervention and regulation. The air tight “digital locks” provisions that will sooner rather than later override all users’ rights have received enormous criticism and even backlash. Not only will these provisions enable the micro-management, if not absolute control, over what consumers can do with their expensive Blue Ray discs, software and other bought-and-paid-for property consisting of content media and hardware (from smart phones to cameras to computers) in terms of where, when and how they can be used. These provisions will enable the elimination of users’ fair dealing rights in DRMed and TPMed material, if the content owner so decrees, and even access to material in the public domain.

Moreover, there is an enormous potential for invasion of privacy - since DRM and TPM can be programmed to “phone home” or to report to third parties on users’ reading, research, listening, viewing, photo, video, webcam, browsing and who knows what other activities to whoever is interested and willing to pay for such information. The proposed privacy protection measures in Bill C-32 (s. 41.14) are simply not adequate to safeguard the legitimate privacy concerns of Canadians.

Bill C-32 would not only enable third party corporations to collect such personal information. It would make it illegal to circumvent such technology if the user is notified in presumably small print in a click through contract of adhesions that this is being done and a means is provided - which may be far from easy or practical - to opt out of the data collection. Just think about how tricky is it is to protect your privacy on Facebook - and nobody is forcing anyone to have a page on Facebook.

Canadians should be able to assume that their default status is that their privacy is being strongly protected. They should not have to take active, complex and quite likely ineffective steps to constantly ensure that this is the case in ordinary and often inevitably necessary daily and activity.

If the Government believes that questions to Canadians about “the number of bedrooms in their homes and what time they leave for work” are too privacy invasive, and are not the business of disinterested professional civil service statisticians, why would the Government enable collection of the most intimate personal information for commercial and who knows what other purposes about what consumers are doing with their computers, smart phones, TV sets, and other electronic devices and content and what information these consumers are obtaining?

The digital lock measures in Bill C-32 are an extreme example of government intervention not only in the market place and the R&D labs and educational institutions of this country but in the innermost realms of Canadian privacy. Apart from certain paid lobbyists and trade associations largely serving the American entertainment industry, and organizations controlled or created by them, there is little if any support for these digital lock measures.

A Canadian compromise style solution would be to allow for protection of anticircumvention measures consistent with but not beyond what is required by the 1996 WIPO treaties - and to also allow protection from such measures when they interfere with users’ fair dealing and any other rights provided by copyright, privacy and generally applicable law. There is nothing in international law to prevent such an approach.

The digital locks provisions of Bill C-32 are clearly the most controversial issue in this reform package - which is otherwise potentially promising. Without a compromise, Bill C-32 will almost certainly be doomed and all of the many supporters of constructive copyright reform will definitely be disappointed.

HK

Copyright Board Issues Commercial Radio Decision

The Copyright Board of Canada today issued its long awaited Commercial Radio tariff and reasons. It is a 116 page bilingual decision that covers six different rights payable to six different collectives.

As the Board states:

A Canadian radio station that broadcasts recorded music off a server reproduces and communicates musical works, performers’ performances and sound recordings. Four copyrights and two remuneration rights must be accounted for. This is the first time that the Board has been asked to set tariffs for all those rights at the same time.

It is notable that this entails more types of rights and more collectives than American commercial radio stations have to deal with. Whether this additional complexity and proliferation of collectives is a good thing or bad thing probably depends on whether one is a broadcaster or someone in the music business. Even in the music business, there is internecine concern about the old “pie” theory that holds that a pie can only be a certain size - and the more people that want a piece of it, the smaller each piece can be. The one sector that clearly benefits from all of this is the copyright bar.

Today’s decision probably validates the pie theory.

In the Board’s words, this is a summary of the result:

How much will the new rates generate in royalty payments, compared to the old rates?

The Board estimates that commercial radio stations will pay a total of $85 million in royalties. This is based on total station revenues of slightly over $1.5 billion in 2009. Using the previously certified rates, radio stations would have paid about $72 million. The new rates thus increase the amount of royalties by $13 million. Of this amount, $10.2 million represent royalties resulting from the introduction of two new rates, for AVLA/SOPROQ and ArtistI.

How much will each collective society receive?

Of the total amount of royalties of $85 million paid by radio stations, the Board estimates that $51 million will go to SOCAN, $13 million to Re:Sound, $11 million to CSI, $10 million to AVLA/SOPROQ and $200,000 to ArtistI.

The overall increase is $13 million per year, which is significant because it is an 18% increase over the previous overall tariff cost to commercial radio stations. And there are still some loose ends and unknown costs, notably regarding internet simulcasting.

However, the total amount is far less than the $200 million predicted by Glenn O’Farrell, former President of the former Canadian Association of Broadcasters. Here’s an article predicting this by Glenn and pictures of former Ministers Jim Prentice and Josée Verner from the Hill Times of February 11, 2008, which seems like aeons ago.

It should also be noted that if Bill C-32 passes as is, the right to collect from commercial radio stations for “reproduction” activities - i.e. copying and storing music on servers so that it can be archived, stored and broadcast efficiently - will be gone, provided that broadcasters can live with the limited exception provided for such reproduction which would last a maximum of thirty days. If the broadcasters can work with this proposed regime, they could save annual payments of $11 million to CSI, $10 million to AVLA/SOPROQ and $200,000 to ArtistI.

Don’t be surprised if the broadcasters try to broaden and lengthen the proposed ephemeral exception.

This tariff is the result of the combination of several proposed tariffs filed in 2007 and 2008. The Board consolidated them all into one hearing, which took place in December of 2008 and January of 2009. If there is judicial review, the Federal Court of Appeal could could hear the matter in a year or less (i.e. before next summer) and typically would render a decision in a few weeks or months at the most after the hearing.

HK

DRM, TPM, WIPO, GDP, & G20

Speaking of some well known acronyms. HT to MG re Brazil's proposed measure to protect users and consumers FROM excessive anti circumvention measures by punishing those who would hinder or prevent otherwise lawful activity, access to the public domain, etc.

Here's a table from 2008 indicating GDP performance of G20 countries. Look at Brazil and Canada - in a virtual tie in GDP, but Brazil having the higher growth rate.

Do we want to shoot ourselves in the foot with copyright policies that will hinder rather than encourage innovation and sustainable economic growth?

Or do we want to preserve obsolete and failed business models for the supposed benefit - but more likely the ultimate harm - of the American entertainment industry.

Never forget Jack Valenti in 1982 telling Congress on behalf of the motion picture industry that"I say to you that the VCR is to the American film producer and the American public as the Boston strangler is to the woman home alone."

It was a good thing nobody listened to him then. Why would we do so now?

HK

On the Right to Read for Blind Persons and others with print disabilities

As reported by KEI Online, below is Ambassador Gero's statement at the recent WIPO SCCR/20 meeting (June 21-24, 2010 in Geneva) on the subject of a possible treaty dealing with rights for the blind. It is rather unusual for an Ambassador to attend a working level meeting such as this. John Gero was very active on IP matters at the very early stages of the FTA, NAFTA and the WTO agreements beginning in the mid to latter part of the 1980's. It is unclear why he chose to personally deliver Canada's main intervention - but, at the very least, it would suggest that Canada regards this as a very important issue.

***************************

Intervention — International instrument on access to protected materials by persons with print disabilities

Thank you Mr. Chairman

Canada is pleased once again to address this Committee on the important issue of access to work by the print disabled. We would like to thank Brazil, Ecuador, Paraguay and Mexico – the co-sponsors of the Visually Impaired Persons (VIP) Treaty Proposal – for their contribution to this discussion. We would also like to thank the U.S., the European Union, and the Africa Group for their respective proposals that address access to print materials by persons with print disabilities, which have been recently submitted to this Committee.

Canada would like to take the opportunity to reconfirm our interest in finding expeditious and pragmatic solutions for access to works by the print disabled. Today, Canada would like to offer our perspective on the general principles that should apply to a possible instrument. We would also like to highlight how some potential reforms to Canada’s domestic regime could positively contribute to the work of this Committee.

In terms of some considerations that could serve the work towards an international instrument, Canada would like to note the following:

First, the element of flexibility is vitally important. It is Canada’s position that any solution to the problems of access by print disabled persons to copyright works should allow for a variety of means for domestic production of accessible material. Members States should have the choice of using exceptions, compulsory licensing or conditional exceptions. Providing Member States with flexibility in this regard is important as some Member States have laws that provide different types of limitations and exceptions for different types of accessible materials. Although there are some Member States here that suggest a mandatory exception is necessary, it is Canada’s view that enabling Member States to implement provisions which reflect local realities by having more than one type of limitation or exception, including for different types of accessible material, would not prevent but actually enhance the international exchange of such materials.

In this regard, a mandatory exception in all countries to allow for the import and export of special format materials does not seem necessary. It is important to recognize and account for the reality that not all Member States have identical laws. Moreover, it is also important to provide Member States with the ability to account for cultural differences and not to restrict their capacity to innovate in their legal framework.

With respect to the various proposals that have been tabled, we note that the Consensus Instrument proposed by the U.S. and the Joint Recommendation proposed by the EU allow for flexibility in laws. Canada sees this as an advantage for it recognizes effective regimes which are already in place, including those which may require payment in certain circumstances.

Another important consideration is that of the trusted intermediary. In order for the discussion to progress, it will be key to address the role and obligations of trusted intermediaries. Canada takes note that some proposals introduce the concept of trusted intermediaries. Canada would welcome a discussion on the range of circumstances in which these organizations could play a role.

Aside from Canada’s preference for flexibility, we view the ability of individuals with print disabilities to import special format materials for their own use without necessarily going through a domestic organization, such as a trusted intermediary, to be an important feature of the copyright modernization bill recently introduced in Canadian parliament that we will now turn to briefly describe.

As stated at the beginning of our intervention, Canada would also like to highlight how some potential reforms to Canada’s domestic regime could positively contribute to the work of this Committee. Earlier this month, a copyright modernization bill was introduced in the Canadian Parliament. This bill implements the rights and protections under the WIPO Copyright Treaty and the WIPO Performances and Phonograms Treaty, it creates new exceptions for educators, librarians, consumers and innovators and it strengthens the tools for rights owners to fight piracy. More to the point of our current discussion, the bill also explicitly addresses the issue of the import and export of special format materials for the print disabled.

With respect to importation, Canadian law – and this principle has existed in our law for many years – provides that it is only necessary to look at the limitation or exception in Canadian law to determine whether material can be imported. The copyright modernization bill clarifies for print disabled persons the existing rule that copyright materials can be imported into Canada if they could have been made in Canada under one of the exceptions in our law. This includes the importation of special format material for the perceptually disabled including importation by individuals with print-related disabilities.

We think that this example from Canadian law demonstrates that the importation of special format materials can be achieved in a variety of ways.

We would also like to note that this principle on importation may already exist in the laws of a number of Member States.

With respect to exportation, the bill in front of the Canadian parliament also has specific measures related to the export of special format materials. It includes a number of provisions to ensure that there is an appropriate balance between the interests of the parties involved. First, exportation is limited to special format versions of works by Canadian authors or authors of the country of importation. Second, the bill allows for the possibility of a royalty collected for export material even though there is a complete exception for domestic production of special format materials. Third, export from Canada can only be done by organizations, not by individuals; and the importer recognized by the law can only be an organization and not an individual. And fourth, the bill allows for the possibility of requiring a contract between the Canadian exporting organization and the foreign importing organization. A contract of this type could stipulate, for example, that the copies could only be used by persons with print disabilities. In this sense, this provision is aligned with the concept of trusted intermediaries by ensuring that the distribution is limited to persons with print disabilities.

Of note, the bill allows the export of special format materials to foreign countries regardless of what the law is in the foreign country and regardless of whether the foreign country has a limitation or exception for the creation of special format materials.

Although the bill does not allow for the export of third country material, any international instrument should establish rules and principles under which third country material can be exported.

In conclusion, we hope that Canada’s perspective on general principles and the approaches set out in our new copyright modernization bill are helpful in advancing the dialogue on this issue.

In terms of next steps, Canada does not see a consensus instrument or a joint recommendation as excluding the possibility of a treaty. Indeed, it can be considered as an important building block.

Thank you Mr. Chairman.

**************************

BTW, KEI is very active on this issue and has lots of useful resources and references. Start here.

This issue is not only important for those who are blind or have other reading disabilities. It is increasingly being seen as a a crucial test of whether WIPO can broker a meaningful multilateral agreement, or whether we will continue to see more erosion of multilateralism and the United Nations spirit. This is indeed what we are seeing in the controversial ACTA negotiations and countless bilateral and plurilateral agreements, such as the proposed CETA (Canada Europe Trade Agreement).

Those who are blind or who have print disabilities should at least have the right to read. Many of them have to struggle to do everyday things that most people take for granted. This right should not be controversial.

It would be very unfortunate if certain vested interests in the copyright world play politics in Geneva at the expense of blind and otherwise print disabled persons. The WIPO Secretariat will no doubt do its best to see a positive and concrete result - which most advocates for the blind would consider to be nothing less than a treaty. "Soft law" is probably not good enough any more on this issue.

But if major countries or blocs, spurred on by major copyright trade associations or acting for other reasons, frustrate efforts for this worthy cause, WIPO's ability to do what is right, just and necessary will be limited.

HK

PS - here is IP Watch's excellent report on how a "golden opportunity" was missed.

The “Balance” Brand in the Balance

It’s kind of interesting, though hardly surprising, that the so-called “Balanced Copyright for Canada” coalition has finally admitted that “the lead funding source is the Canadian Recording Industry Association” (i.e. CRIA).

A few years ago at the Fordham conference, a prominent international content industry lobbyist, in a funny Freudian slip, referred to CRIA as the “Canadian Recording Industry of America.”

I wonder if the so-called “Balanced Copyright for Canada” coalition will admit that it is, at the very least, ironic that its name is arguably confusingly similar to that of the Balanced Copyright Coalition (“BCC”) (which I started in 2007) which morphed into the Business Coalition for Balanced Copyright (“BCBC”).

The BCC and the BCBC indeed were based on a genuine attempt to achieve real balance - the notion that blue chip corporate giants in the communications, internet, broadcasting and retail sectors (e.g. Google, Yahoo, Rogers, Telus, the Canadian Association of Broadcasters and the Retail Council of Canada) inherently need to see copyright from the various standpoints of consumers, users, owners, and creators - and that their views are thus very much more “balanced” than the much smaller purely content industries which see things from one purely parochial side only - namely their owner based interests - which don’t necessarily and often emphatically do not reflect the interests of actual creators.

There is not much that is “balanced” about CRIA’s latest lobbying front. If it were truly grass roots, it wouldn’t even need funding. The basic cost of website is about the same or less as a case of beer. Starting a blog such this one or a Facebook site is free. However, the so-called “Balanced Copyright for Canada” coalition apparently needs the weight of corporate lobbying lucre behind it.

I would say that the word “balance” is now being bandied about badly.

HK