Excess in Anton Piller Orders

A dynamite decision from Justice Binnie and the Supremes today in the case of Canadian Bearings v. Celanese Canada.

A major Toronto law firm - Cassels, Brock - has been kicked off a case involving industrial espionage because the firm unintentionally but avoidably accessed privileged electronic documents in the course of review of evidence after execution of an Anton Piller order.

Their problem stems from carelessness and an excessively adversarial approach in circumstances that called for careful restraint in recognition of the exceptional position of responsibility imposed by the unilateral and intrusive nature of an Anton Piller order. The protection of solicitor-client confidences is a matter of high importance. (para. 54)

The Supremes ruled importantly that the onus is on the searching party to show that there will be no prejudice to the party that was searched. (Para. 55)

The decision is very important for its thorough review of the extraordinary Anton Piller procedure - which Justice Binnie says at the outset “bears an uncomfortable resemblance to a private search warrant”.

Interestingly, there is no indication that there was a Charter challenge to the very concept of an Anton Piller order - a possibility that was raised by an Ontario judge in the the recent Ridgewood v. Robbie case mentioned by Justice Binnie, in which the plaintiffs attempted to execute the search upon a terrified ten year old kid whose parents weren’t home. I’ve written about that case in the EIPR last year.

Indeed, Justice Binnie goes to some length to indicate that such orders are necessary in today’s world.

Para. 32 Experience has shown that despite their draconian nature, there is a proper role for Anton Piller orders to ensure that unscrupulous defendants are not able to circumvent the court’s processes by, on being forewarned, making relevant evidence disappear. Their usefulness is especially important in the modern era of heavy dependence on computer technology, where documents are easily deleted, moved or destroyed. The utility of this equitable tool in the correct circumstances should not be diminished. However, such orders should only be granted in the clear recognition of their exceptional and highly intrusive character and, where granted, the terms should be carefully spelled out and limited to what the circumstances show to be necessary. Those responsible for their implementation should conform to a very high standard of professional diligence. Otherwise, the moving party, not its target, may have to shoulder the consequences of a botched search.

This may suggest that a Charter challenge to an Anton Piller order would not likely succeed. But with all of the caveats and dangers that lurk for lawyers who obtain and execute such orders, and all the requirements that the Supremes have spelled out in some detail, and the repeated references to their exceptional and extraordinary nature, I’m willing to predict that we will see far fewer attempts to obtain them and far more reluctance on the part of Courts to issue them.

And that would be a good thing...

HK

ET Come Home...Hopefully Not To Close to CDN Copyright Law

Some professors at Dalhousie have published a provocative and readable paper on the very complex and very important subject of extraterritoriality (“ET”) entitled GLOBAL REACH, LOCAL GRASP: CONSTRUCTING EXTRATERRITORIAL JURISDICTION IN THE AGE OF GLOBALIZATION.

Not surprisingly, it draws attention to the Supreme Court of Canada’s complex and not very well understood 2004 decision in SOCAN v CAIP. In that decision, the SCC said that the Copyright Board was wrong to limit SOCAN’s reach only to situations where the server is located in Canada. In principle, the SCC held, a content provider in another county could be liable to SOCAN in Canada if there is a “real and substantial connection” to Canada. Justice Binnie indicated that:

(para. 60): A real and substantial connection to Canada is sufficient to support the application of our Copyright Act to international Internet transmissions in a way that will accord with international comity and be consistent with the objectives of order and fairness.

In terms of the Internet, relevant connecting factors would include the situs of the content provider, the host server, the intermediaries and the end user. The weight to be given to any particular factor will vary with the circumstances and the nature of the dispute.

With respect to Justice Binnie and the Supremes, this could mean a lot of trouble for Canada if the decision is misinterpreted and applied too broadly. In a certain sense, the whole ET discussion was largely obiter dicta because there was no particular scenario before the Court - and the Court recognized the highly fact dependent nature of the necessary enquiry to determine whether there can be liability in Canada . Indeed, apparently mindful of the potential reach of their decision, the Court issued a caution - which has drawn less attention than their otherwise somewhat bold assertion of ET reach:

This conclusion does not, of course, imply imposition of automatic copyright liability on foreign content providers whose music is telecommunicated to a Canadian end user. Whether or not a real and substantial connection exists will turn on the facts of a particular transmission (Braintech, supra). It is unnecessary to say more on this point because the Canadian copyright liability of foreign content providers is not an issue that arises for determination in this appeal, although, as stated, the Board itself intimated that where a foreign transmission is aimed at Canada, copyright liability might attach. (para. 77)

(emphasis added)

On a practical level, it will be very difficult for SOCAN to enforce its theoretical win. I cannot see MSN or YAHOO or countless other foreign sites that may in some way somehow involve music lining up to get licensed with SOCAN in Canada. Nor can I see them responding - other than by way of “make my day - we’ll see you in court” - to any demands from SOCAN.

The application of these ET factors is completely uncertain to the types of situations that readily come to mind. Never mind the enormous difficulties of what constitutes a communication to the public by telecommunication or a performance in public. On the latter points, we may hopefully get some insights in the presumably imminent Board decision on Ringtones, which has been pending for over a year.

I don’t think that the SCC meant its decision to be a carte blanche to SOCAN to go fishing for revenue in the USA or elsewhere. They seem to have explicitly recognized the possibility and danger of multiple payments (which I think is what they mean when they refer to as “layering” of rights) and that the WIPO treaty approach is to affix liability at the point of transmission. This may all get clarified if and when Canada ratifies the WIPO treaties. And it should get clarified in our enabling legislation because it is absolutely not in Canada’s overall interest to get to pushy on extraterritoriality, as I will explain and as the Dalhousie profs agree.

Some of this may also get clarified in the current version of the “100 Years War”, a.k.a. SOCAN’s Tariff 22 which is flaring up again at the Copyright Board. The latest version of the proposed tariff shows little indication that SOCAN has formulated any more precise or viable legal theory than it had in mind in 1995, and which led to the first trip to the SCC. The problem is that many objectors have already been worn down by the expense of opposing SOCAN and SOCAN’s interrogatory tactics (e.g. Archambault and Canoe) and the Board’s unwillingness to permit parties to participate adequately but on a limited basis in order to address legal and jurisdictional issues without being subjected to intensive and invasive interrogatories that will inevitably serve no other function than driving away worthy opponents.

Just because some end users may be Canadians certainly should not be sufficient to find liability against a foreign website owner. Hopefully, the Supremes meant that only to be one factor - and an inconclusive one per se. Were it to be otherwise, the Internet would come to a crashing halt - since any website can attract users from any country in the world. That’s why it's called the “world wide web”. The last thing that we need is each country assuming jurisdiction and applying their law over websites abroad because some users may reside in that country. If that were to become the norm, every Canadian website would have to clear its content under the laws of other jurisdictions ranging from the USA to the Uzbekistan.

That’s simply because what goes around comes around in this area - and we don’t want ET coming home to roost too actively in Canada. The authors from Dalhousie recognize this and conclude their report with an explicit reference to the SOCAN case and Canada’s interest:

That said, this is an option which should be used sparingly and cautiously. Canada, though not the smallest boat on the lake, most frequently sails with larger ones: the odds of it being caught in someone else’s wake are far greater than of Canada changing the course of others. Canada’s domestic privacy legislation, as we have noted, largely results from the economic influence of the European Union, which left Canada little practical alternative but to comply: the United States, though, being a larger market still, did not create the same kind of legislation Canada did, but has not lost access to European markets. Similarly, Canada could try unilaterally to impose its views on copyright law on the international community, taking the robust approach to “real and substantial connection” that the SOCAN case suggests. This carries a certain risk, however, if Canada “legitimizes” one state unilaterally imposing its standards on others by doing so itself, this helps to free up the dominant players to act likewise, and in a way that might not accord with Canadian interests. With specific regard to copyright, the dominance of U.S. intellectual property interests internationally dictates that unilateral use of extraterritorial jurisdiction by that country could end up imposing American copyright law on Canada as well as others.

Even allowing that exceptional circumstances might exist where Canada could and should act unilaterally in the absence of international consensus, it must choose the occasions sparingly. While the edifice of territoriality is being slowly dismantled by globalization, this should compel Canada to be defensive and proactive in equal measures as it seeks both to protect and to promote its own interests in the new global order.

(Emphasis added)

For example, if the USA were to get as proactive as Canada is in danger of becoming on ET, it could become illegal in the USA for a Canadian Joyce scholar - for hypothetical example - to post stuff on her Canadian website that is PD here but not there - because of our rightfully and thankfully shorter term. If an American copyright owner were to sue in an American court merely because the site was accessible to Americans, the owner of that website would have to defend - otherwise he or she might get arrested at the American border if a negative default judgment were to be obtained - even if the judgment were not enforceable in Canada. That’s the post 9/11 reality.

In this case, the SCC has opened the copyright ET door in a way that may tempt lower courts or the Copyright Board at the behest of copyright owners to push farther than the SCC may have intended - even with the caution in place. Justice LeBel recognized this in his careful dissent. Parliament may need to put a stopper in place so that we don’t end up falling into a trap set by SOCAN’s potentially overreaching position in Tariff 22 and the SCC’s at least partial agreement with SOCAN’s view of the world.

The Dalhousie study finds the majority reasoning in the SOCAN case to be “confusing in that it refers to the extraterritorial application of the Copyright Act, suggesting that Canada has taken prescriptive jurisdiction over matters outside its borders.” The study seems to suggest at page 40 that the SCC perhaps went to far in applying the Mother of all ET decisions in Canada to the world of the internet and copyright. This is Libman decision of the SCC in 1985 - in which there was clearly a “real and substantial” connection to Canada. A bunch of fraudsters operated a fraudulent stock market boiler room in Toronto - but argued that they couldn’t be prosecuted in Canada because their victims were in the USA and their money was hidden away in Central America, from where the promotional material was mailed. The accused argued implausibly that the offences hadn’t occurred in Canada. Clearly, there were crimes and they had to prosecuted somewhere. In the SOCAN situation, there are no “offences” and if - I repeat IF - a foreign website somehow attracts a Canadian audience, the liability should be determined in the foreign country and the fact that there happens to be a Canadian audience should not per se be sufficient to ground liability in Canada.

I would allow that the situation could be different in the event that a foreign website is actually specifically targeting Canadians - i.e. “Canadians come here - we welcome Canadian Dollars at par with USD - get your illegal movies cheaper here!” And especially if there was clearly at least some element or inseparable element of some infringing activity taking place inside Canada. Some of this may become clearer if and when the British courts deal with BPI’s lawsuit in England against www.allofmp3.com which is the supposedly legal-in-Russia and very cheap but not quite free download site.

Anyway, I highly commend the Dalhousie study by Professors Coughlan, Currrie, Kindred and Scassa. It is important and timely. It was prepared for the estimable Law Commission of Canada, which has done other good work in IP - in which I was privileged to have been closely involved on another complicated issue - security interests in IP.

HK

DOHA Dead?

The DOHA round of WTO trade talks appears to be dead. Not even D.O.A. Dead before getting that far.

The developing countries had hoped to recoup some of the ground they lost in the Uruguay Round that lead to the TRIPS agreement in 1994. They wanted to push for such things as disclosure of the origin of genetic resources in patent applications and the the relationship between the Convention on Biological Diversity (CBD) and the WTO TRIPS Agreement. Here's a good take on the IP situation.

This may lead to renewed US attempts to push bilateral and regional "free" trade deals - such as the Free Trade Agreement of the Americas (FTAA). This could be more difficult now in South America, since several countries have swung to the left since the last major attempt to push the FTAA in 2003.

NAFTA could also be reopened - and the USA may pressure Canada to "harmonize" upwards to Mexico's more than absurd copyright term of life + 100 years.

Hopefully, Canada will resist the inevitable pressures that will come to trade off sovereignty and sound Canadian IP policy for increased "access" to US markets - which means very little anyway. Just ask anyone in the lumber or beef business.

HK

Classical Music Composers and Performing Rights Societies

Here's a very interesting article by an American law student with some musical background - whose name happens to be Amanda Scales. It suggests that copyright laws are actually hurting the cause of serious or "classical" composers - mainly through the excessive term of protection and an American problem having to do with the "Fairness in Music Licensing Act".

While the article is focused on American law, there are some aspects that ring true here - namely her discussion of the "follow the dollar" approach that North American societies have used since the early 1990's - which eliminates any "subsidies" or "tribute" as she calls it to classical or serious composers - who by definition don't get much air play or performances in bars, etc. She doesn't use that term - "follow the dollar" - which was used in the SOCAN milieu - but see page 285 of her article.

She suggests on the last page of her article that classical composers should form their own performing rights collective - something I have talked about for years. Naturally, there are big economic barriers to such an endeavor - but a good case could be made for government funding to get one at least up and running in Canada and to provide some ongoing support. The Department of Canadian Heritage has subsidized a number of its clients and collectives lately that don't need any subsidy.

Here's the link again... it's an excellent article from a law student and highly worthwhile by any standard...

HK

ADDENDUM:

There's a very good critque of Ms. Scales' paper by one M. Gladu by way of two "comments" - click below. It merits a full response, which follows:

Dear Mr/Ms Gladu:

You are quite right - the paper is far from perfect and somewhat lacking in evidence and rigour. However, it is an excellent paper by undergraduate law student standards and your very articulate and expert critique confirms that it does a great job raising issues and topics. I’ve seen many writings about collectives that are ultimately much less accurate and informative by people who are very experienced.

A few points in response to your comments:

1. You ask “Are concert/live music licenses fairly valued?” Well, that was certainly a very major issue in the 1994 Canadian Copyright Board decision in which SPACQ (a Quebec based association representing the interests of composers, etc.) argued forcefully that SOCAN was greatly undervaluing the concert tariff in the rate it sought from the Copyright Board. The Board agreed in principle - and although it couldn’t change the rate for the period in question, it clearly concluded that

The rate will therefore be set at 2.2 per cent for the whole period. The Board hopes, however, that SOCAN will give due consideration to filing its proposed concert tariff for 1995 at a rate higher than that in the SOCAN/CAMP agreement. The Board is of the view that unless this course is followed, the interests of SOCAN's members will not be properly served.

(emphasis added)

This spat between SPACQ and SOCAN is still a sore point for SOCAN and likely to remain so for a long time.

2. You say that “...some sources appearing in her bibliography are just not well-versed and specialized on reporting/critiquing the activities and inner workings of the administration and collection of performance royalties. Miss Scales should have gone direct to the source...” Well, I’ve enjoyed a long and at times quite warm rapport with the major PROs in North America. They are always very courteous but rarely very transparent - although I have to say that SOCAN is probably more transparent overall and accessible on the whole than any other major collective in Canada - but that’s not saying much.

3. Even members have a hard time understanding how the distribution rules work in PROs. The chronic and persistent complaint by serious music composers is that their royalties have been going down since the merger of the two Canadian societies in 1990 and the “follow the dollar” movement of the early 90's even if their performances are doing well. The concert and broadcast rates in Europe and Japan are said to be MUCH higher abroad in many cases than Canada - so they often get bigger income from foreign than domestic sources - even though they are performed more here in Canada. SOCAN won’t hear any discussion of a “cultural fund” - which helps serious composers in Europe. The SOCAN Foundation is better than nothing - but barely so in terms of the overall problem.

4. At least in the USA, there is a choice of three PROs. In Canada, there is now only one. Many now regret the 1990 merger - though they are afraid to say so in public. The dirty little secret is that some Canadians have joined with one of the American collectives. They somehow have found this to be advantageous.

5. I agree that her analysis of the effect of term extension may be somewhat unconvincing, but the fact remains that the increase to life + 70 cannot possibly help serious composers. It may help their publishers and sometimes lazy and occastionally difficult grandchildren and great grandchildren in some rare cases. An example of "difficult" might welll be Stephen Joyce. The 1998 CTEA (“Sonny Bono”) term extension legalisation put a 20 year moratorium on works entering the PD in the USA. There is every basis to fear that this trend to extension and moratorium will continue - especially given Mexico’s recent inexplicable move to life + 100 and the effect that may have on NAFTA. So, it may be a very long time before anybody can do an arrangement of or themes and variations on early 20th century masterpieces - such as those by Straus (d. 1949) or Stravinsky (d. 1971). Ironically, Stravinsky is often quoted as saying “ Lesser artists borrow, great artists steal” - and that is clearly true of his own work, as he was quick to admit. But when he “stole”, he also infinitely enhanced. Ms. Scales has a point here - even if she doesn’t quite hit the bull’s eye in terms of methodology or evidence. If term extension gets in the way of the work of the next Stravinsky, Ives, Dvorak or others who blatantly borrow, that will be very said. If serious music publishers actually seriously “invested” in younger unestablished composers and actively promoted their work, there might be some faint argument for term extension. But this isn’t the case any more, if it ever was the case in recent times.

Anyway, thanks for your comments. You seem very knowledgeable indeed. Call me anytime and we’ll chat.

HK

Exploiting Kids as Copyright Cops

There's a scary story in today's NY Times about how the Hong Kong government is somehow getting Boy Scouts and other kids in uniforms to spy on and report copyright infringers.

It's bad enough when Access Copyright and other private interests try to warp the minds of children with inaccurate propoganda. But when the State turns little kids wearing Boy Scout and Girl Guide uniforms into spys and snitches, it's really regrettable. According to the story:

Starting this summer the Hong Kong government plans to have 200,000 youths search Internet discussion sites for illegal copies of copyrighted songs and movies, and report them to the authorities. The campaign has delighted the entertainment industry, but prompted misgivings among some civil liberties advocates.

The so-called Youth Ambassadors campaign will start on Wednesday with 1,600 youths pledging their participation at a stadium in front of leading Hong Kong film and singing stars and several Hong Kong government ministers.

The Youth Ambassadors represent a new reliance on minors to keep order on the Internet. All members of the Boy Scouts, Girl Guides and nine other uniformed youth groups here, ranging in age from 9 to 25, will be expected to participate, government officials said.

It's too bad the the Boy Scouts leadership can't follow it's own motto and "be prepared" to speak truth to power in this instance.

HK

G8 Lobbying

The G8 has issued a declaration entitled Combating IPR Piracy and Counterfeiting.

This declaration was the result of a well-orchestrated effort by American and British lobbyists who were very influential in St. Petersburg.

A collection of the usual lobbying suspects in Canada (including CRIA, CMPDA, CMPA, and CAAST) has issued a press release congratulating the Canadian governmnet on signing on and indicating - in their all too frequently misleading fashion - that:

Furthermore, we look forward to the Canadian government fulfilling these commitments as soon as possible in order to better protect intellectual property in the digital age. The introduction and passage of new federal copyright legislation will be a key step to fulfilling the commitments.

(emphasis added)

These Canadian lobby groups are largely branch plants of their American masters.

There is, of course, nothing in the G8 statement that requires Canada to enact any legislation.

Speaking of international obligations, only two of the G8 countries - the USA and Japan - have yet ratified the 1996 WIPO Treaties. Canada continues to meet and exceed its international IP obligations - unlike the USA which has been found to be in serious contravention at the WTO of its copyright obligations and is clearly unable or unwilling to do anything about it. People who live in glass houses...

Speaking of piracy, these organizations behind the Canadian press release - particularly the music and computer software industries - have a very expansive, elastic and invasive notion of what they mean by “piracy”. It would catch just about every home and business in Canada.

The injection of IP into the G8 agenda reflects the enormous efforts being devoted to preserving fat margins and failing business models though massive government intervention in the form of ever increasing levels of IP protection. This will actually impede the progress of technology, international development and access to knowledge. Hopefully, Canada’s new Government will see through this and do what’s best for Canada.

IP is a big issue between the US and Russia, and a problem for Russia in terms of entry into the WTO. But one would have thought that there are much more urgent matters affecting the public interest of the planet for the G8 as a whole to worry about.

I keep reminding certain lobbyists to be careful about what they wish for. Elevating IP to this level may seem like a short term victory - but flying too high with politics and IP can be dangerous.

HK

More Margaret Atwood on Copyright

A certain vigilant Easterner has brought Ms. Atwood's latest pronoucements to my attention. Canada’s "Queen of CanLit" and copyright proclamations is at it again. She says in a recent interview in the Halifax Chronicle Herald that:

And don’t forget that copyright is a fairly recent thing, it was brought in the 19th century because people in the States were pirating books written by English writers, and selling them at no profit to the writer or the original publisher, often in a mangled version so writers were losing control of their text, of any income that they might have otherwise had, and publishers were losing out. And once the States also had writers that were being pirated, they got together and made copyright law to protect their markets.

Well – let’s not get too technical. But Ms. Atwood is off by about two centuries and one whole continent. The British Statute of Anne goes back to 1709 – and it’s viewed as the first “modern” copyright law to which today’s copyright statutes trace their legal DNA. The American's didn't get serious about copyright law until 1909 - and even then, they underprotected their own nationals and everyone else until 1976.

This is almost a rich as her comment about copyright exceptions at the 1996 Committee hearings:

If copyrights were cars, this would be car theft.

Can’t wait to see what she’ll come up with next. Between her, Graham Henderson and Captain Copyright, who needs to read ever-so-boring books, cases and legislation?

But in all seriousness, the Committee took her very seriously last time and eviscerated the concept of "exceptions" to a shocking extent. So, her colourful comments have to be taken seriously because the next Committee and the Canadian Heritage bureaucrats may well take them seriously - again.

Which is another reason why it's so important for the next Commmittee to be adequately informed - in either official language - rather than be uninformed because they will only look at written material in both official languages.

HK

Captain Copyright's Contender

Captain Copyright now has a contender when it comes to pernicious propaganda. And it’s none other than the Law Society of Upper Canada (“LSUC”). The LSUC (and several of its other provincial counterparts) have taken it upon themselves to inform their members that software piracy is not only illegal but also unethical. For convenience, I'll refer to the LSUC - of which I am a member.

One might be tempted to ignore this as a bit of presumptuous paternalism. Howver, the LSUC should never be ignored. There’s a mandatory aspect to all of this and the LSUC does have the power to govern the legal profession. But, wait till you see what they define as “illegal”.

The LSUC has a publication innocuously called GUIDELINES ON ETHICS AND THE NEW TECHNOLOGY. This was apparently prepared by or for the Law Society of Alberta and disseminated by the Federation of Law Societies of Canada in 1999. It has been adopted by other provincial law societies as well. Here’s the orginal document, with some references that are missing in the LSUC version. Note the several references to the Copy Right [sic] Act.

It deals with such innocuous topics as advertising on the Internet, not practicing in jurisdictions where one is not licensed, etc. Then, for some inexplicable reason it has as its centrepiece a section entitled SOFTWARE PIRACY with a whole appendix on the subject. The sources of information are the Software Publishers Association – now the Software and Information Industry Association (“SIIA”) and Microsoft. The SIIA is a very powerful Washington lobby and anti-piracy trade association.

According to the LSUC (on the advice of its ever so dispassionate sources of information):

Software piracy is illegal and unethical. Lawyers shall ensure that support staff and students-at-law uphold the ethical standards of the lawyer’s practice. The management and organization of and compliance with license agreements for
all software used by a firm shall not be left entirely to an office manager or
support staff.

A lawyer can guard against accidental software piracy by carefully reviewing the provisions of the software licensing agreements for software used in the office. Where strict compliance with the licensing agreement may cause a hardship, exemption must be sought from the licensor.
(emphasis added)

Nowhere does this publication tell one that the Canadian Copyright Act has explicit provisions (s. 30.6) that permit, inter alia, the making of a backup copy of a program or the making of a copy for the purpose of making a program compatible with the user’s hardware. Whether doing so could entail a breach of contract is another and by no means clear matter – but it is emphatically not copyright infringement.

The appendix gets worse. It states “Pirating can occur whenever copying occurs.” And what is copying? Well, why don’t we ask Microsoft? According, to Microsoft, as adopted by the LSUC:

What is software piracy?

Software piracy is the unauthorized copying, reproduction, use or manufacture of
software products. Microsoft defines “copying” as:
(1) downloading software reproducing it) on a computer’s temporary memory by running the programs from a floppy disk, hard disk, CD ROM,
(2) downloading software onto another media such as a hard disk (e.g. a diskette) or a computer’s hard disk (the computer’s main information storage area); or
(3) using software that has been placed on an office’s network server.
(emphasis added)

Those categorical statements ignore the fact that this is how programs are meant to be used, and that s. 30.6 of the Copyright Act exists.

The appendix contains the blatantly incorrect categorical statement that “Copying software is illegal, regardless of whether the copied software is thereafter offered for sale, is given away free, or is retained for the copier’s own use.” Once again, LSUC – please read s. 30.6 of the Copyright Act. And have a look at http://www.download.com/ - which legally gives away - and offers up for “copying” - oodles of useful software. Copying software is simply not categorically illegal - it all depends on the circumstances.

What is wrong about all of this?

• This is another example of the cacophonous conflation of copying and piracy. And now, add ethics to the mix. Not all copying is illegal, much less piratical. Piracy is a word that should be saved for those engaged in serious commercial activity, not hard working lawyers who want to make back up copies of their essential and crash prone software. To do so in not an indictable offense, as this document seems to suggest.
• The LSUC has become the likely unwitting shill of a very powerful lobby and anti-piracy group and Microsoft itself. Let’s give the LSUC the benefit of the doubt here and assume for the moment that they don’t know better and that this was inadvertent (although that’s a scary thought for lots of other reasons relating to their immense power and resources). After all, the document didn’t originate from the LSUC. But it does bear the LSUC logo. The Federation of Law Societies of Canada might wish to explain how this document evolved.
• This is typical of the modern trend to copyright correctness that is trying to make all of us agents and copyright owners and collectives. This is why CMEC’s Copyright Matters! booklet troubles me – with its incomplete, oversimplified and even simplistic pronouncements and excessively cautious advice to teachers. This why I and others are so concerned with Captain Copyright’s obvious efforts to turn little school children into the equivalent of youth group copyright cops.
• “Ethics” is without doubt the most important aspect of being a lawyer. Our consciences and our credibility as lawyers depend on upholding the highest standards of ethics. The LSUC should be very careful about treading into ethical territory when there is no need and their research is so incomplete. This is the ultimate issue. Please, get it right or leave it alone.

From my point of view, there are indeed profound ethical issues involved on the part of those who wrongfully and deliberately mislead and misstate about copyright law, for example in a way that would deny copyright users’ their lawful rights, or assert sham claims, or misinform law makers in order to influence policy. Indeed, there are a lot of ethical issues involved with copyright law and many of them will be explored at what promises to be an excellent conference next month hosted by the University of Calgary at Banff. I will be there and presenting a paper. Stay tuned.

Lawyers are not school children. But most lawyers are also not copyright experts and the LSUC and other law societies wield immense power – obviously much more than Access Copyright and school teachers. I think that it’s wrong for law societies to disseminate incomplete and incorrect copyright information and to lay down ethical dicates based upon it. In this case, the intentions may have been honourable but the result is very unsatisfactory.

HK

Official Languages - When "Either" means "Both" or "Neither"

As reported, on June 26, 2006 Judge Layden-Stevenson of the Federal Court ruled against my application for a declaration that the Heritage Committee violated my official language rights when it refused to distribute documents that were an essential part of my testimony because they were in English only. Naturally, I’m disappointed and I’m considering an appeal. There is already interest in interventions. The decision is now online - in English only.

The bottom line is that the Heritage Committee, the Commissioner of Official Languages, and now the Federal Court are saying that bilingualism today means that I can’t use unilingual documents as part of my testimony to a Parliamentary Committee. For example, in this case, the Heritage Committee refused to let its members have copies of definitive, relevant treatise material by Mihály Ficsor, the world’s leading authority on the issue then being considered (the WIPO treaties) published only in English by Oxford University Press. This Committee chose to remain ignorant of this essential part of my testimony (i.e. Ficsor’s supportive analysis) rather than to have access to it in English only. My documents were not distributed to the Committee members.

I won’t go into the details of why this material was so essential to my testimony and presentation as a witness, but anyone familiar with the issue of national treatment, the WIPO treaties, and blank media levies will know that hundreds of millions of dollars are stake. Neither the substantive copyright issues nor the Committee’s Report were in issue before the Court in any way. The question before the Court involved the right of everyone to use EITHER the English language - OR the French language - to present testimony about this or any issue - WITHOUT being required to use BOTH languages.

Here is what s. 4 of the Official Languages Act states:

4. (1) English and French are the official languages of Parliament, and everyone has the right to use either of those languages in any debates and other proceedings of Parliament.

(emphasis added)

However, the Committee, the Commissioner of Official Languages and now the Court have ruled that a person’s right to use “either” official language when dealing with a parliamentary committee really means an obligation to use “both”, when it comes to written communication. So, "either" applies only to the spoken word, and not the written word. Written words must be in both official languages, despite what the Official Languages Act seems to so clearly say. The Court believes that this is consistent with the Official Languages Act and that, in any case, the Committee’s practice is protected by parliamentary privilege.

With respect, I believe that this is fundamentally wrong on both fronts.

In my view, this result is the absolute antithesis of bilingualism. I’m astounded that, in 2006, Parliament - which is our supreme federal institution - would seriously contend that “either” means “both” when it comes to official languages and that, in any case, it can rely on parliamentary privilege to get around the plain meaning of the Official Languages Act, which is quasi- constitutional legislation to which it has expressly bound itself. It’s a setback of several decades of struggle for language equality and access to their ruling institutions by individual Canadians. In my view, it’s contrary to the law and, above all, to common sense. Canadians in every province and of every political persuasion should be very concerned about this decision.

As to parliamentary privilege, there is a Supreme Court of Canada decision from last year very close on point penned by Justice Binnie called Vaid v. House of Commons, which held that the Speaker could not invoke privilege to get around human rights legislation. It seems to me that this should apply at least as much to the Official Languages Act, which is "quasi constitutional" legislation and which is explicitly applicable to Parliament.

In any case, by saying that “either” means “both”, and by denying my right to provide essential documents to a Parliamentary Committee in the only official language in which they were available, and allowing that Committee to remain ignorant of this essential information, this interpretation effectively says that “either” means “neither”.

HK

The Corruptibles

A partial antidote to Captain Copyright's propoganda can be found in the very clever EFF campaign against current excessive lobbying efforts and potential legislation in the USA. It's an online group of cartoons called The Corruptibles.


HK

The Supremes on Famous Trade-marks in Canada

The Supreme Court of Canada has issued two brilliant decisions today which dismissed two appeals that would have - if successful - taken “famous mark” protection in Canada to a level even beyond what the big Americans trade-mark owners have in their own country under the badge of what they call “anti-dilution”. Readers will recall that Victoria’s Secret lost a case in the US Supreme Court three years ago against an adult novelty store named Victor's Little Secret that sold “tawdry merchandise”.

One appeal involved the attempt by MATTEL - owner of the BARBIE trade-mark to stop a Montreal BBQ Restaurant from calling itself BARBIE’S. The other involved an attempt by the French high end champagne maker VEUVE-CLICQUOT to stop a Montreal clothing shop chain from calling itself CLIQUOT.

The judgments were released together and were both written by Justice Ian Binnie. Although they involved different facts and legal issues, there are certain obvious common elements - the most important being the ambit of protection to what are regarded as “famous” trade-marks. The Court has said that the ambit is not unlimited. BARBIE may cover dolls and maybe more but it doesn’t extend to restaurants and likewise CLIQUOT may cover champagne and maybe more but not women’s clothes.

The result in no surprise to Canadian intellectual property lawyers. However, Justice Binnie, in his characteristic manner, clearly and constructively sets straight decades of sometimes confusing and even apparently contradicting case and statutory law that has left practitioners and business people perplexed. Here is my quick take on the two very important rulings:

• The fact that a trade-mark is famous is a factor - but not by any means determinative - that there can be a likelihood of confusion or deprecation of good will
• there must be real evidence of a likelihood of confusion or deprecation of good will - not just speculation - and the absence of evidence of actual confusion is relevant and may even lead to an “adverse inference”. In other words, there’s got to be real evidence of a likelihood of confusion - and preferably of actual confusion - in order to succeed
• confusion is assessed in the mind of the “The Casual Consumer Somewhat in a Hurry” and such consumer is to be given “ a certain amount of credit” and not regarded as “completely devoid of intelligence or of normal powers of recollection or are totally unaware or uninformed as to what goes on around them.”
• the farther apart or more “remote” the wares and services in question are, the safer it will be for the less famous party
• And lest anyone forget, “Unlike other forms of intellectual property, the gravamen of trade-mark entitlement is actual use. By contrast, a Canadian inventor is entitled to his or her patent even if no commercial use of it is made. A playwright retains copyright even if the play remains unperformed. But in trade-marks the watchword is “use it or lose it”.

Justice Binnie has also provided a wonderful guide to trade-mark lawyers in terms of what they will need in evidence in future cases and on the use of surveys and how important it is to ask the right questions in these surveys.

HK

On Demand Take Down (Censorship) in Canada?

The Globe and Mail is reporting a very strange aspect of the "APO Joe" $5,400 piggy bank scandal.

Apparently, CIRA (Canadian Internet Registration Authority) and Canadian Domain Name Services (CDNS) responded virtually on demand to take down a satircal site called www.youthforvolpe.ca - which no longer works.

The Globe reports that:

Mr. Volpe's campaign had the site shut down without knowing, it seems, who put it up: "Hi Everyone," wrote Brenden Johnstone, who is with the Volpe campaign, in an e-mail to other leadership campaigns. "There has been concern about how the issue of the Volpe donations was reflecting on the leadership race.

"My Office has had the website suspended through CIRA [Canadian Internet Registration Authority] and CDNS [Canadian Domain Name Services] and it will be down as soon as 6 p.m. I think the issue with the website has been dealt with..."

It will be very interesting see what proves to be the basis for this apparently on demand take down. This is not the way the system is supposed to work. CIRA and CDNS should explain right away what is going on here. Do we now have instant and apparently on demand political censorship in Canada? Even in China, things don't usually work this fast..

It is possible that the website owner "voluntarily" took it down - but that's not what the Globe is suggesting. Volpe's office is taking credit for having it "dealt with..."

An explanation would seem in order...this is being looked into...stay tuned...this could potentially be as interesting as the piggy bank debacle itself...

UPDATE at 4:15 PM

I indeed contacted Michael early today and he indeed looked into this promptly - Michael is indeed on the Board of CIRA. This is what he reports...

CIRA's response still leaves some questions in my mind. Is the system always this fast to respond when "The registrar advised CIRA that it made this request because its registrant would not provide valid Canadian contact information." ????

HK

Linking to Access Copyright

Michael has a good post on Access Copyright's Captain Copyright “information” website for young kids and their teachers. The content reminds one in some ways of the Council of Ministers of Education, Canada (CMEC)’s pamphlet entitled Copyright Matters! – which also seems to tell teachers more about what they can’t do than what they can. At least Captain Copyright has pictures.

In any event, one of the more remarkable parts of this already rather unbelievable Captain Copyright website is the Intellectual Property Notice and Disclaimer – which contains the following gem, amongst many others:

Links from Other Websites
…
Permission is expressly granted to any person who wishes to place a link in his or her own website to www.accesscopyright.ca or any of its pages with the following exception: permission to link is explicitly withheld from any website the contents of which may, in the opinion of the Access Copyright, be damaging or cause harm to the reputation of, Access Copyright. In the event we contact you and request the link be removed, you agree to comply with that request promptly. If you link to or otherwise include www.captaincopyright.ca on your website, please let us know and create any link to our home page only.
(emphasis added)

So, Michael, reach into to your conscience as to whether your blog might conceivably “in the opinion of the Access Copyright, be damaging or cause harm to the reputation of, Access Copyright.” If the answer is even maybe “yes”, you may be linking without permission! This could at minimum be taken as showing a lack of “respect for copyright”. Or maybe even constitute infringement! And of course you should be prepared to – upon request –to remove your link “promptly”.

Seriously, readers, it shouldn’t be necessary to say this – but it ironically is apparently necessary in view of just the kind of propaganda that www.captaincopyright.ca disseminates these days – that linking to a website and criticizing it doesn’t require permission. To suggest otherwise is nothing less than an insult to the public intelligence.

Is this the same Access Copyright that wants the Canadian government to enable it to license the Internet and to greatly increase its already considerable power and revenues through extended collective licensing? Is this the same Access Copyright that is already getting more than $30 million a year, mostly of taxpayers’ money, for its indemnity scheme? Is this the same Access Copyright that believes in “respect for copyright”?

HK

Knopf v. Speaker of the House of Commons - the Hearing

My case against the Speaker of the House of Commons was heard yesterday in the Federal Court. Madam Justice Layden-Stevenson had clearly reviewed all of the important material and cases ahead of time. She patiently heard all arguments and had many good questions. We await her ruling.

There’s a good article about the case by Jack Aubry in today’s Ottawa Citizen and National Post.

Meanwhile, an interesting irony was unfolding. At the conclusion of my argument at about 12:20 I made the point that I wasn’t tilting at windmills, or “ tyring to knock over the Peace Tower or even to put a crack in the mortar, or heaven forbid the foundation.” For non-Canadians, the Peace Tower is the centre-piece of Parliament and perhaps the most important visual symbol of Canada.

Unbeknownst to me at the time of my submissions, it happened that at 7:28 AM earlier in the morning yesterday the modern clock mechanism on the Peace Tower stopped working for the first time since it was installed in 1980.

There are a some ironies and coincidences here.

The first is that the installation of this clock took place at about the same time (1980) as the establishment of Canada’s modern Constitution Act and the Charter of Rights in 1982 - which are the foundation of my case.

The second is that the clock can only be fixed by an American company. The thrust of my testimony and the documents I had tried to submit to the Heritage Committee concerned the 1996 WIPO treaties, the potential Canadian ratification of which is the subject of intense pressure from the American government and the American recording industry.

The third is that the American company in question happens to have its Canadian branch in Woodstock, Ontario, my lovely home town.

My case was about opening the doors on Parliament Hill below the Peace Tower a bit wider to the concept of dialogue between concerned citizens and informed Members of Parliament in a modern democracy.

What a strange coincidence that the clock on the Peace Tower would stop the same day as my hearing. Could it be fate?

HK

Copyright, Competition, Free Trade & Chocolate Bars

The Supreme Court of Canada today granted leave to appeal in the very important case of Kraft v. Euro Excellence - in which Kraft had succeeded below in using s. 27(2)(e) of the Canadian Copyright Act to block the parallel importation of legitimate Toblerone chocolate bars contained in packaging for which Kraft was the exclusive Canadian licensee of certain copyrighted elements - unless the defendant covered up the offending elements with a sticker, which was done in this case. The defendant also had to pay substantial damages. One can easily imagine the ruling below being used in future cases to effectively stop parallel importation altogether of an enormous variety of consumer goods - on the basis of copyright in some artwork on a package. If this were to happen, it would be very bad news for competition and free trade.

Today, the Supreme Court of Canada granted leave to appeal to the defendant, Euro Excellence. As usual, no reasons were given.

Here is the order from the Court and the Court’s summary of the case:

Euro-Excellence Inc. c. Kraft Canada Inc., Kraft Foods Schweiz AG et Kraft Foods Belgium SA (C.F.) (31327)

The application for leave to appeal is granted with costs to the applicant in any event of the cause.)
Coram: Bastarache / LeBel / Fish

SCC Summary:

Property law – Copyright – Parallel importation of consumer products – Whether courts below erred in interpreting s. 27(2)(e) of Copyright Act, R.S.C. 1985, c. C-42.

Kraft Foods Belgium S.A. ("KFB") and Kraft Foods Schweiz AG ("KFS") manufactured Côte d'Or and Toblerone confectionery products in Belgium and Switzerland, respectively. Euro Excellence imported those products into Canada and distributed them here. KFB authorized Euro Excellence to distribute its Côte d'Or confectionery products in the Canadian market in 1993, but the contract was not renewed when it expired three years later. Kraft Canada Inc. ("Kraft") has been distributing Toblerone chocolates in Canada since 1990. It began distributing Côte d'Or products pursuant to contract in 2001. In October 2002, KFB and KFS registered copyrights on the product wrappers in Canada in the artistic category. They also entered into and registered a licence agreement with Kraft that, among other things, gave Kraft the right to use and publicly present the works in association with the distribution or sale in Canada of confectionery products.

After Euro Excellence refused to stop distributing the products, the Respondents brought an action in the Federal Court seeking an injunction and damages. Kraft alleged that the distribution of Côte d'Or and Toblerone chocolates by Euro Excellence in Canada violated copyright in the artwork on the product wrappers. Under s. 27(2)(e) of the Copyright Act, it is an infringement of copyright for any person to import into Canada, for the purpose of sale, a copy of a copyrighted work that the person knows or should have known infringes copyright or would infringe copyright if it had been made in Canada by the person who made it. The Federal Court issued the injunction and ordered Euro Excellence to pay damages. The Federal Court of Appeal allowed the appeal, but only on the issue of damages.

I should disclose that I act for the Retail Council of Canada - who sought leave to intervene in the leave application.

HK

Language Issues in Parliamentary Committees

Students of the ancient and arcane law and custom of parliament (lex et consuetudo parliamenti) and potential witnesses in the next round of committee hearings on copyright revision may be interested in the case of Knopf v. Speaker of the House of Commons (T-770-05 in the Federal Court). The application will be heard on May 24, 2006 here in Ottawa at 90 Sparks Street at 9:30 AM in Court Room 1104.

Back in April of 2004, I appeared before the Canadian Heritage Committee, which was chaired at the time by the Honourable Sarmite Bulte, P.C., M.P. I asked to have certain documents relevant to the issue of private copying and WIPO ratification distributed to the Committee members to assist them in their deliberations. These four documents included an excerpt from Mihály Ficsor’s authoritative book, published by Oxford University Press and available only in English. The subject of WIPO ratification was one of the issues - in fact the main issue - before the committee. The Chair refused to distribute my documents to the members because the material was in English only.

I felt that an important principle was at stake, namely whether a witness before a Parliamentary Committee can submit supporting relevant documents in either official language of Canada, or whether the documents must be in both official languages. Clearly, there are often insurmountable logistic problems with the latter practice - and I frankly don’t know how one can be assured of adequate translation of material such as Ficsor’s even if unlimited budget and time were available - which will rarely if ever be the case. For these and many other reasons, I looked into the law and decided to do try to do something about it. In my view, when the Official Languages Act (“OLA”) speaks of the right of Canadians to use “either” official language when communicating with Parliament, “either” means “either”. It does not mean “both”. This is backed up by the Charter.

I felt that the Committee needed to have essential relevant information, even if available only in one official language. The Committee clearly disagreed.

I filed a complaint with the Commissioner of Official Languages, who concluded that the Committee’s practice was OK according to the OLA. So I followed the procedure in the OLA and launched an application in the Federal Court.

The hearing, as noted, will be next week. Anyone attending will get a crash course in the truly fascinating law of parliamentary privilege - which is the main basis upon which the Speaker of House of Commons is defending the actions of Heritage Committee.

HK

Dogged Attempts to Combat Piracy

I'm not making this up. It's too bizarre to be made up. This motion picture industry initiative involves using specially trained black Labrador canines to sniff out potentially infringing DVDs:

United Kingdom, Los Angeles - - The Federation Against Copyright Theft (FACT), express delivery company FedEx and HM Revenue & Customs, has joined forces to launch an exciting new initiative to help combat DVD piracy.

As part of a project promoted by the Motion Picture Association of America, Inc. (MPAA), FACT instigated the training of two black Labradors named Lucky and Flo (pictures attached) by one of the world’s leading experts in the field whose other clients include police, fire and rescue service. The dogs were trained over an eight month period to identify DVDs that may be located in boxes, envelopes or other packaging, as well as discs concealed amongst other goods which could be sold illegally in the UK. These DVDs are often smuggled by criminal networks involved in large scale piracy operations from around the world..

Here's whole press release on the MPAA website.

Jack Valenti must be proud. When he ran the MPAA, he was certainly known for being dogmatic.

HK

Excessively Cautious Clearance Culture

It's very hard these days to do documentaries. Excessive caution on the part of the E&O folks and the lawyers invovled are killing good films and censoring those that survive. And the rights clearance process is costing a fortune that should otherwise be spent on real creativity. Much of this caution is unnecessary and simply wrong and much of the clearance expense is unnecessary. But it's deeply ingrained in what is commonly called the "clearance culture".

Here's an interview that I did with Kevin McMahon that may hopefully embolden some documentarians and some overly cautious colleagues in the legal profession...

This was originally published by the National Film Board of Canada in Focus Magazine, April, 2006 for distribution at the 2006 HotDocs Festival in Toronto.

MUSIC TO MY EARS - Enter the CMCC

Less than two weeks after the most influential Indies left CRIA (RIAA North), a who’s who of Canadian music stars has come out dead against the copyright gospel according to the CRIA and the CPCC (the levy collective of collectives). The stars include:

Barenaked Ladies, Avril Lavigne, Sarah McLachlan, Chantal Kreviazuk, Sum 41, Stars, Raine Maida (Our Lady Peace), Dave Bidini (Rheostatics), Billy Talent, John K. Samson (Weakerthans), Broken Social Scene, Sloan, Andrew Cash and Bob Wiseman (Co-founder Blue Rodeo).

They are opposed to:

• Suing their fans generally and statutory damages in particular. They say that:

In terms of specific copyright reforms, this principle suggests that the government should repeal provisions of the Copyright Act that allow labels to punish fans with damages of $500 to $20,000 per song. Statutory damages of this magnitude are unduly harsh where music fans share songs for non-commercial purposes. The threat of such enormous liability does not deter file sharing, but unfairly forces vulnerable people to cave in to the labels’ bullying tactics without a hearing of their case. To sue for non-commercial music sharing, record companies should have to prove their damages or lost profits, as is usually required by law.

• TPMs and Levies. They say that:

...the government should not blindly implement decade-old treaties designed to give control to major labels and take choices away from artists and consumers. Laws should protect artists and consumers, not restrictive technologies. If enacted at all, laws prohibiting the circumvention of technological measures should remain narrow. Any new legislation should not prohibit technologies or devices that may increase flexibility and facilitate choice for artists and music consumers. The law should also guarantee that artists and fans retain the ability to access music, and to use it in a fair manner.

On the issue of fair use of music, copyright law should be changed to clarify that transferring songs from one format to another is not an infringement of copyright. It is not fair to require consumers to pay twice for the ability to transfer bought songs to an iPod or other device by imposing additional levies. Instead, eliminating the rigid technicalities of the current fair dealing provisions and moving to a more flexible concept of fair use can solve this problem.

• Multinational record companies speaking in their names. They say that:

Until now, a group of multinational record labels has done most of the talking about what Canadian artists need out of copyright. But let’s be clear: major labels are looking out for their shareholders, not for Canadian artists. Recording industry lobbyists, despite claiming to represent artists, seldom speak for us. Legislative proposals, particularly those that would facilitate lawsuits against our fans or increase the labels’ control over the enjoyment of music, are made not in our names, but on behalf of the shareholders of the labels’ foreign parent companies.

The full package can be found at the website of the Canadian Music Creators Coalition (“CMCC”).

What does this mean? At the least, it will change the course of Canadian copyright revision. But it may mean even more. I would go even farther than Michael on this one.

If this spreads, it could be an artists’ Declaration of Independence. It may be that the creators’ revolution against excess copyright has begun in earnest right here in Canada.

Starting in Canada, this declaration effectively discredits virtually all of the uncritical support that some Canadian government officials - particularly those in the Department of Canadian Heritage - have provided for the music industry’s campaigns in favour of the levy scheme, statutory damages, TPMs, and blind faith WIPO Treaty implementation. From now on, if Government officials and Ministers fail to take notice of this declaration and continue to support the CRIA’s agendas, they will now have to account for actually opposing the well articulated and explicit wishes of some of our leading Canadian artists. This will hopefully not happen.

On a more immediate level, for example, I’ve been recently asked by senior officials in key jurisdictions whether there are Canadian artists who are opposed to blank media levies. It seems clear that the CMCC is indeed against a law that forces their fans to pay for “transferring songs from one format to another” and to “pay twice” to transfer bought songs to an iPod or other device. That is a direct kick in the levy scheme’s solar plexus - and maybe even a mortal blow, given all of the other assaults underway.

Internationally, this could even play out as the copyright equivalent of the Boston Tea Party, the sledgehammers at the Berlin Wall, and the beginnings of other great revolutions. The unpleasant fact that big copyright often speaks falsely in the names of actual creators and can be in conflict of interest with these same creators’ interests is now open and outed by the creators themselves who are finally using their articulate voices in a brave and brilliant manner.

I hope that the music industry does not engage in its known tactics of marginalization and even retaliation against these worthy souls who have spoken out. This has been done to individual artists in the past. These points of view can no longer be dismissed as those of an aging, hippy, and flaky former rock star alone against the world (as Janice Ian was painted in 2002). This is clearly a well organized group of very successful world class artists in the prime of their careers. And bless them - they’re Canadian, eh!

And I hope that responsible Ministers will listen directly to these artists rather than to any of their officials or lobbyists who may persist in regurgitating industry positions that have now clearly been disavowed by leaders amongst those in whose name they were wrongly put forth.

Anyone who has read my blog or other writings before will know that I have been advocating for these positions for some time, and calling upon creators to speak out. For example, Jack Granatstein has done so effectively. I hope that the time has come for Canada to take the lead in providing copyright laws that actually work for artists and consumers, and not primarily for a handful of large intermediaries, collectives, lawyers, lobbyists and others who depend upon exploiting them.

The CMCC has has just taken a giant step forward in making copyright laws serve the interest of real creators and their fans- also known as "consumers" and "the public".

HPK

CRIA - What Lies Ahead?

Michael has a great blog entry on CRIA and the widely reported resignation from it by six of the leading Canadian Indies, including the legendary Anthem, Aquarius, Nettwerk and True North labels, on the basis that:

“...it has become increasingly clear over the past few months that CRIA's position on several important music industry issues are not aligned with our best interests as independent recording companies"

"...we do not feel that we can remain members [of CRIA] given CRIA's decision to advocate solely on behalf of the four major foreign multi-national labels.”

The letter dated April 12, 2006 and sent to a large number of VIPs in Ottawa focusses on the recent CRTC submission but clearly suggests that there is more involved. In fairness to CRIA, it expresses appreciation for CRIA’s work “in many areas including copyright”.

But, speaking of copyright, there are troubles afoot for CRIA at the Copyright Board as well. CRIA, along with many others, has recently been fighting CSI (which is basically a coalition of music publishing trade associations) over the CSI’s proposed online music tariff. This is an incredibly complex saga that will overlap and intersect in strange and unpredictable ways with SOCAN’s decade long and still amorphous effort to license music on the Internet - but I digress.

In the CSI file, CRIA objected to its Class “B” members (i.e. the Canadian Indies) having to answer interrogatories - a position with which anyone familiar with Board hearings from an objector viewpoint would tend to sympathize with.

CRIA’s position was that “When it became clear that the interrogatory process was too onerous to involve its smaller members, CRIA withdrew on their behalf.”

The Board then did something quite interesting. Apparently out of concern for the Indies, it ordered CRIA to send notices to the Canadian Indies in the following language:

“CRIA recently opted to change the scope of its representation of its members’ interests in the forthcoming proceedings before the Copyright Board dealing with CSI’ s proposed tariff for the reproduction of musical works by online music services. Subsequently, the Board ordered CRIA to advise you of the following:
1) In these proceedings CRIA has chosen to act only on behalf of (name of each member that CRIA represents).
2) As a result, CRIA will not be allowed to advance any argument or lead any evidence that relates to your situation in particular, or to the situation of any other member of CRIA that CRIA does not represent in these proceedings generally.”

CRIA strongly objected to being told how to deal with its own members. It asked the Board to “reconsider” on the basis, inter alia, that:

the implication of the Order was that CRIA had acted in bad faith, deceitfully or otherwise inappropriately vis-à-vis its class B members, an implication that had no basis in the record;

The Board denied the request for reconsideration. CRIA has now launched a major judicial review application in the Federal Court of Appeal (A-593-05) and described the main issues as follows:

A. Did the Copyright Board breach the duty of fairness in issuing the Order?

B. Did the Copyright Board err in concluding that sections 66.7(1) and/or 66.71 of the Copyright Act give the Board the authority to issue an Order requiring a party to communicate with its members in a particular manner?

C. Did the Copyright Board err in ordering CRIA to send to each of its non-Class A members a notice advising them of CRIA’s decision to no longer represent its non-Class A members in the tariff proceedings?

CRIA’s judicial review memorandum is dated March 28, 2006 - and the responses should presumably follow 20 days later, which is to say on April 17, 2006.

So - with some of its main Canadian Indies gone, its polling and PR in disarray, and a public position on levies that reverses its twenty year old quest - what is happening?

This much we know about CRIA’s recent milestones:

• It still has the apparent support of its big four multinational members, Warner Music Group, Sony BMG, EMI Group, and Universal Music.
• These are the Canadian subs of the same big four that are under serious fire in the USA for alleged price fixing for online music and for alleged payola violations.
• CRIA’s Canadian component - small as it may be - is evaporating.
• CRIA’s support of Sam Bulte probably contributed to the former MP and potential Heritage Minister’s loss of her seat and likely her parliamentary career
• CRIA’s polling data has been inconsistent with its stated positions and has been ridiculed far and wide. CRIA has recently changed pollsters and PR firms.
• CRIA has fizzled and failed in its litigation campaign against Canadian file sharers and “infringers” (i.e. music lovers and customers) and P2P “weapons of mass distribution”, e.g. KaZaA. It badly lost round one of the file sharing litigation in 2004 not only because the law was against them (the very same levy law it fought so hard for since the early 80's) but because its evidence was so woefully inadequate. It was hearsay interspersed with fatal gaps. CRIA blamed the loss on its lawyer, Ron Dimock, who is by anybody’s measure one of Canada’s top IP litigators. He took the brief that was handed to him at the last minute by CRIA. He did as good as job as could possibly be done with the brief he was handed. I know because I opposed him.
• CRIA’s appeal to Federal Court of Appeal in 2005 was dismissed, although it tried to paint the result as a victory.
• I’ve lost count of the numerous prominent law firms and IP lawyers CRIA has retained in succession in the last couple of years on its various causes. At the rate they are going, they may soon have to call me ;-)
• CRIA provided disingenuous, incomplete and incorrect information in testimony to a Parliamentary Committee on March 9, 2004 about the WIPO treaties
• CRIA tried to get Michael Geist, its most vociferous, persistent and effective critic, fired from his Toronto Star gig.

What lies ahead?

CRIA’s current major active campaigns presumably include these:

• Canadian ratification of the 1996 WIPO treaties and super tough DMCA style DRM, TPM and ISP liability legislation. CRIA is by far the main “demandeur” on this front.
• The CRTC Commercial Radio Review
• The Copyright Board hearings on Private Copying for 2005-2007 in which CRIA is a major stakeholder in the CPCC, although CRIA wants to pull the plug on the levies. That is not likely to sit well with others in the CPCC tent. CPCC collects the unpopular private copying levies.
• The CSI and SOCAN internet hearings at the Copyright Board - in which music industry politics and internecine civil strife will continue to unfold in strange ways that also are likely to cause a lot of collateral damage and cost to those who are forced by the nature of the process not only to watch but to participate at considerable expense and inconvenience.

It will be interesting to see how Canadian officials, politicians, the CRTC, the Copyright Board and Courts will react to all of this.

Not to mention that real constituency that counts, which is the actual Canadian music industry itself and the millions of Canadians who actually love and support actual Canadian music.

Maybe Michael is right that we need to drop the “C” from CRIA. Or, they can just keep the acronym and change their name to the “Canadian Recording Industry of America”, as a prominent international movie industry lawyer/lobbyist said in a priceless Freudian slip.

HPK

PS - I should remind all, in case anyone doesn’t know, that I acted against CRIA in the file sharing litigation and continue to act against the CPCC, in which CRIA is still a major stakeholder, on the levy front. But, as always, I speak only for myself on this blog.