Canadian Technology & IP Law : Canadian Technology Lawyers & Attorneys : Stikeman Elliott Law Firm : IP Law in Toronto, Montreal, Calgary, Ottawa & Vancouver

Justine Whitehead -

On May 29, 2013, Bill C-516 was introduced as a private member’s bill in the House of Commons. The bill seeks to amend the Copyright Act to provide creators of certain works with royalties payable upon resale of their work.

The proposed legislation sets the resale royalty at 5% of the sale price of any work that is re-sold for $500 or more after the first transfer of ownership by the artist.  The resale right would apply to “an artistic work, including a painting, sculpture, collage, print, lithograph, tapestry and a ceramic or glassware item”, but would not include maps, charts, plans, photographs or architectural works, or a copy of an artistic work, unless the copy is one of a limited number that had been made by the author or with the artist’s authorization.  Therefore, the scope of work which would attract the resale right is narrower than the scope of “artistic work” as currently defined in the Copyright Act.

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Justine Whitehead -

On March 1, 2013, Bill C-56 was introduced in the House of Commons. The majority of Bill C-56 is directed to amendments to the Copyright Act (CA) and the Trade-marks Act (TMA) to add new tools to fight commercial counterfeiting and piracy activities. An overview of these proposed tools, which include new civil and criminal remedies, and new powers for customs officers in respect of counterfeit and pirated goods, is set out below.

New Criminal Offences

Bill C-56 would expand the criminal provisions of the CA and introduce criminal offenses under the TMA. For the CA, Bill C-56 would make it an offence to possess an infringing copy of a work for the purposes of sale, rental, and/or distribution for the purpose of trade or exhibition in public by way of trade. It would also make it an offence to export (or attempt to export) an infringing copy of a copyrighted work for the purpose of sale or rental. (The CA currently already prohibits import in Canada of any infringing copies of a copyrighted work for sale or rental.)

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Justine Whitehead -

On March 1, 2013, Bill C-56 was introduced in the House of Commons. As might be expected from the short title of the proposed act (Combatting Counterfeit Products Act), the majority of Bill C-56 is directed to amendments to the Copyright Act and the Trade-marks Act to add new civil and criminal remedies to curtail commercial counterfeiting activities. Update: The details of these new provisions are reviewed here.

 While the essence of Bill C-56 is clearly directed to counterfeiting, the legislation also proposes significant amendments to the Trade-marks Act (the TMA) that are unrelated to counterfeiting activities. The most significant of these other changes are highlighted below.

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Alexandra Stockwell -

As we noted in our post on July 3, the Copyright Modernization Act  had received royal assent, but would not come into force until an Order-in-Council was issued. This has now happened: on November 7, 2012, most of the new provisions of, and amendments to, the Canadian Copyright Act came into force as a result of the publication in the Canada Gazette of Order SI/2012-85. The Order also specified that certain provisions, which relate to the WIPO Copyright Treaty and WIPO Performances and Phonograms Treaty, will come into force when those treaties are ratified by Canada.

A notable exclusion from the Order is the “Notice-and-Notice” regime (the future sections 41.25, 41.26 and 41.27(3) of the Copyright Act), which will only come into force after a consultation process and the establishment of regulations that will be needed to implement the regime. The Canadian “Notice-and-Notice” regime, which differs from the “Notice-and-Take-Down” rules in the United States, will oblige Internet Service Providers (ISPs), after being notified of infringement allegations by a rights holder, to notify the relevant subscriber of the allegations received.  ISPs will also be required to retain records that would enable the identification of the subscriber allegedly engaged in the infringing activity for a period of six months (or one year, if infringement proceedings are commenced in respect of the claimed infringement within six months of the initial notice from the rights holder). Once the regulations are ready, the date when the “Notice-and-Notice” provisions come into force will be published in a separate Order-in-Council.

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As we've discussed in a number of recent blog posts, the Supreme Court of Canada this week released a number of major copyright-related decisions. In one of these cases, Society of Composers, Authors and Music Publishers of Canada v. Bell Canada (SOCAN), the Supreme Court considered whether there would be a tariff for the communication of previews of musical works over the internet.

Online music previews are short extracts of musical works and assist a consumer in deciding musical purchases. The Copyright Board concluded that those who make previews available, and the users that listen to previews, were entitled to avail themselves of the fair dealing exception under section 29 of the Copyright Act, as listening to the previews constituted research of a purchasing decision (see our previous post). The Federal Court of Appeal upheld the Copyright Board’s decision and SOCAN sought leave to appeal to the Supreme Court of Canada.

In upholding the decisions below, the Supreme Court concluded that the previews constituted fair dealing, applying the test articulated by the Court in CCH Canadian Ltd v. Law Society of Canada (CCH).

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In a ruling issued July 12, 2012, the Supreme Court upheld the decisions of the Federal Court of Appeal and the Copyright Board in Re: Sound v. Motion Picture Theatre Associations of Canada, concluding that performers and makers of sound recordings are not entitled to royalties for the broadcast of their recordings in film or on television as part of a movie soundtrack.

Under section 19 of the Copyright Act, performers and makers of sound recordings are entitled to remuneration when their recordings are performed or telecommunicated to the public. However, the section 2 definition of “sound recording” excludes a “soundtrack of a cinematographic work where it accompanies the cinematographic work.” “Soundtrack” is not defined, but the appellants had argued that it means the whole aggregate of sounds accompanying the film, and not the individual pre-existing sound recordings incorporated into the soundtrack. They contended, therefore, that royalties should be collected when those recordings are broadcast as part of a film’s soundtrack.

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On July 12, 2012, the Supreme Court of Canada clarified the scope of the “fair dealing” exception to copyright infringement, found in section 29 of the Copyright Act (the Act), which allows copies to be made for research, private study, criticism and review. 

Facts and Judicial History

As stated in a previous blog post, the case of Alberta (Education) v Canadian Copyright Licensing Agency surrounds the contention over whether elementary and secondary schools can claim the benefit of “fair dealing” exception for copies of works made at the teacher’s initiative for the student’s use.

The Copyright Board (the Board) distinguished between copies made by the teacher at the request of a student and copies made by the teacher without prior request from a student. It concluded that copies made by teachers for student use were made for the allowable purpose of “research or private study”, but found, applying the  CCH fairness factors articulated in CCH Canadian Ltd v Law Society of Upper Canada, that the copies did not constitute fair dealing and were therefore subject to a royalty. The Federal Court of Appeal upheld the Board’s conclusion. 

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David Elder -

In a major, but slim, victory for proponents of electronic commerce, a majority of the Supreme Court of Canada has ruled that online sellers of music and video game downloads are not required to pay more copyright royalties than their “bricks and mortar” counterparts, solely because the products from the virtual stores are delivered via the internet.

In addition, although not considered by the Court, these rulings would also suggest that another copyright tariff, for the delivery of ringtones to mobile phones, may be invalid.

In two decisions that form part of the unprecedented “copyright pentalogy” of copyright tariff appeals heard by the top court last year, the Supreme Court considered whether a download of a recording of a musical work, either on its own or when incorporated into a video game, constituted a “communication to the public by telecommunication,” such that a download could attract a distinct copyright royalty, in addition to the royalty payable to the copyright holder for the reproduction of the work on the buyer’s computer or device. 

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On June 29, 2012, Bill C-11 passed third reading in the Senate and received royal assent. Although the Bill moved quickly through the Senate after clearing the House of Commons less than two weeks ago, copyright reform in Canada has been a long time coming. Bill C-11 is the third copyright bill tabled by the current government - the first two bills as well as several others introduced by previous governments died on the order table. The current Bill, which was re-introduced last Fall was described in an earlier post. At the report stage, eight amendments to the Bill were passed. Further amendments to the Bill proposed at the report stage and in the Senate were voted down. Following royal assent, the Bill officially became S.C. 2012 c.20.  It will come into force following an order-in-council process, which is expected to take several months, as the regulations relating to several of the provisions have yet to be established.

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Last month, the Stop Online Piracy Act (SOPA) and PROTECT IP Act (PIPA) became household names in the United States, as internet and technology giants like Wikipedia and Google engaged in a widely publicised day of protest and persuaded many Americans to petition their congressional representatives. Now, Canada’s own proposed Copyright Act amendments in Bill C-11 are garnering some comparisons to SOPA. “Can Canada’s version of SOPA be stopped?” asked journalist Peter Nowak in a recent Globe and Mail opinion piece.

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David Elder and Lindsay Gwyer -

Bloggers, tweeters, webpage owners and other providers and hosts of internet content can breathe a little easier today following a decision of the Supreme Court of Canada that ruled that merely providing hyperlinks to defamatory content cannot make them liable for defamation.

That said, while the decision provides clear support from the highest court in the land for both free expression and the preservation of the nature and benefits of the internet as whole, it stops short of giving hyperlinkers a “Get Out of Jail Free” card for all uses and presentations of links to defamatory material. 

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Alexandra Stockwell and Robert Mysicka -

The Canadian Government is giving copyright reform another try, reintroducing what is essentially the same copyright bill that died last spring with the dissolution of Parliament. 

But while the text may be the same, one thing has clearly changed: this time, the ruling Conservatives have a legislative majority, significantly increasing the likelihood that the new bill will actually become law, either in its current form or with amendments introduced at Committee.

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David Elder and Lindsay Gwyer -

The long road for local broadcasters wanting to charge fees to cable and satellite companies for rebroadcasting their signals just got a little longer, as the Supreme Court of Canada has granted leave to hear an appeal a Federal Court of Appeal decision that upheld the ability of the Canadian Radio-television and Telecommunications Commission (CRTC) to establish such a regime.

The “Value for Signal” (VFS) regime was authorized by the CRTC in its 2010 group licensing framework decision, and was intended “to remove unnecessary barriers to the continued viability of private broadcasters and to ensure that broadcasters are able to obtain, through market-based negotiations, fair value of the programming they broadcast.”

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Amy Hu and Michael D. Smith -

In Century 21 Canada Limited Partnership v Rogers Communications Inc., the BC Supreme Court upheld the validity of the so-called “browse wrap” agreements and awarded damages against Zoocasa and its parent Rogers for Zoocasa’s breach of the Century 21 website terms of use when it pulled listings from the Century 21 website for use on its own real estate listing search engine. The BC court confirmed that industry standard browse wrap agreements (i.e. a website’s posted terms of service) can form valid contracts without being brought to the attention of users or requiring any review/acknowledgement by the user before accessing the website.

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David Elder & Robert Mysicka

In an unprecedented cluster of cases focusing on copyright, the Supreme Court of Canada has recently granted leave to appeal in five separate cases involving tariffs approved by the Copyright Board. 

The cases, at least four of which will be heard on December 6 and 7, 2011, will consider tariffs dealing with online music, photocopying by teachers for instructional purposes and music in movie soundtracks.

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David Elder -

“Free-to-air” local television signals may no longer be free to cable and satellite subscribers, following a recent court decision affirming the scope of the powers of the Canadian Radio-television and Telecommunications Commission (CRTC) under the Broadcasting Act.

In an important ruling that addresses the intersection of broadcasting and copyright law and policy, a majority of the Federal Court of Appeal found, in the case of Reference re the Canadian Radio-television and Telecommunications Commission’s Broadcasting Regulatory Policy CRTC 2010-167 and Broadcasting Order CRTC 2010-168, 2011 FCA 64, that the Copyright Act permits the CRTC to limit the statutory retransmission rights of broadcasting distribution undertakings (BDUs), such as cable companies, by imposing any regulatory or licensing condition that is consistent with the Commission’s statutory authority under the Broadcasting Act. In fact, the majority went so far as to state that Parliament has ranked the objectives of Canada’s broadcasting policy ahead of the statutory retransmission rights granted to BDUs under the Copyright Act.

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The Federal Courts Rules provide a summary judgment procedure that allows a party to prevent claims or defences that have no chance of success from proceeding to trial. Although the summary judgment procedures were amended a year ago, a recent decision of the Federal Court demonstrates that summary judgment is still only granted in the most appropriate cases.

In Concept Developments Ltd. v. Webb, the plaintiff (Concept), a designer and builder of homes, brought a motion for summary judgment against the defendants, Mr. and Mrs. Webb, alleging infringement of its registered copyright in the plans and design of one of its model homes. The Webbs had apparently viewed Concept’s model home, but disliked Concept’s quoted price to build the house, so they subsequently took their business to another home building company (High Grade). According to the facts (which had not been fully established), the Webbs showed Concept’s model home design to High Grade and requested something similar for their house, albeit with some modifications. The Webbs then drew up what they wanted, gave that drawing to High Grade, and the house was subsequently built as desired. Concept claimed $124,000 for its direct loss from not building the home, as well as $40,000 for intangible loss. 

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In early September 2010, the Federal Court of Appeal concurred with an earlier decision of the Canadian Copyright Board "(Board)" holding that the download by a single user of a music file from an online music service is a communication of the musical work to the public by telecommunication.

In Bell Canada, et. al. v. SOCAN the Court of Appeal was asked to determine whether the transmission of a musical work to an individual by an on-line music service should be considered to be a communication of that work to the public by telecommunications within the meaning of paragraph 3(1)(f) of the Copyright Act. The question of whether the download was in and of itself a communication was not at issue, as it had been previously held by the Supreme Court of Canada in SOCAN v. Canadian Association of Internet Providers that a music file is communicated when it is recreated on the recipient computer. Such a communication was also held to qualify as a communication by telecommunication.

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Recently, a court in the UK (Football Dataco Ltd et al. v. Sportradar GmbH) found that the location of a server determined the appropriate jurisdiction to regulate internet content. This is not entirely consistent with the Canadian approach.

Sportradar tried to argue that the court did not have jurisdiction to hear the claim that Football Dataco’s copyright and database rights had been infringed by Sportradar’s alleged reproduction of Football Dataco’s live scores and statistics. The content from Sportradar was stored on webservers in Germany and Austria, but was made available to users in the UK by Sportradar’s online betting sites. To determine what law should apply, the court focused on where the act of “making available” occurred. The court held that such an act occurs where the transmission takes place, and more specifically, where the server is located. Since Sportradar’s servers were located outside of the UK, the court found that it could not assert jurisdiction over certain of the claims.

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The power of social media was on full display this past week, as the unauthorized publication of a recipe for apple pie drew a quick and virulent online response. The story begins on November 3, when blogger Monica Gaudio announced on her blog that Cooks Source, a small New England magazine, had republished an article on the history of apple pie (she had previously written it for another publication) without permission. While Gaudio was credited for her work, she never consented to, nor was she compensated for, the use of the article. After emailing the magazine’s editor, Gaudio received a response informing her that the internet is “public domain”. The email, which Gaudio published on her blog, sparked a fierce response from an online community that quickly coalesced on Facebook to disparage the magazine’s conduct.

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This past weekend’s Globe and Mail included an interesting article regarding the principle of droit de suite, which provides artists with a right to a percentage of the sale price on the resale of their works of art. The article counts 59 countries, including most of Europe as providing such a right and discusses the lobbying efforts of Canadian Arts Representation, which has argued for a 5% resale right in Canada. On a related note, Bill C-32, Canada’s Copyright Modernization Act (which includes no such right) is expected to receive second reading today.
 

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On July 17, 2010, CSI, the company formed as a royalty-collection vehicle by the Canadian Musical Reproduction Rights Agency (CMRRA)  and the Society for Reproduction Rights of Authors, Composers and Publishers in Canada (SODRAC) , proposed three new tariffs which would apply to the reproduction of music (which can include broadcasting, streaming and downloading) by non-commercial radio stations, online music providers, and satellite radio providers.

In the proposed CMRRA-SODRAC Inc. Non-Commercial Radio Tariff, 2011, CSI is requesting that the Copyright Board of Canada  certify a tariff of 0.63% of the annual gross operating costs of radio stations that are either owned or operated by not-for-profit corporations, excluding the Canadian Broadcasting Corporation.  In the case of such a non-commercial radio station that is a “low use station” (generally, a station that plays music for less than 20% of its broadcast time), the tariff would be lower, at 0.23% of its annual gross operating costs.  In exchange for the payment of the tariff, the non-commercial radio stations would receive a license to broadcast music contained in CSI’s repertoire as often as desired, including the streaming of the broadcast over the Internet.

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Craig Collins-Williams

On June 2, 2010, Industry Minister Tony Clement tabled Bill C-32 entitled An Act to Amend the Copyright Act, which may also be referred to as the Copyright Modernization Act. Bill C-32 represents the Conservative government’s latest attempt to implement revisions to the Copyright Act. Potential changes to the Copyright Act have been the focus of intensive discussion and debate between stakeholders for a number of years. The Conservative government’s previous reform attempt, Bill C-61, was introduced in the summer of 2008, but it died on the order paper (before being passed into law) when a federal election was called in the fall of 2008. The previous Liberal government’s June 2005 attempt, Bill C-60, also died on the order paper when Parliament was dissolved in November 2005.

Growing pressure from the European Union and the United States, which view the Canadian Copyright Act as inadequate to protect copyrighted material, appears to have prompted the federal government to propose amendments to the Act once again.

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The Digital Millennium Copyright Act (DMCA) is an American statute that provides for the automatic takedown of counterfeiting materials posted on the Internet simply by sending a notification (a “DMCA Notification”) from the copyright holder to the website hosting the counterfeiting materials. While drafting and sending a DMCA Notification is easy as shooting fish in a barrel, this articles presents three important tips to avoid problems later in the DMCA-driven process.

1. Don’t overreach: Avoid liability and “bad press” by making a serious effort to determine if the materials really are infringing… And that implies that you consider the possibility that the materials qualify under “fair use” before sending the DMCA Notification;
    
2. Properly save a copy of the infringing materials prior to sending the DMCA Notification;
    
3. Consider search engine optimization: Limit the impact of future infringements by creating legitimate content and making sure that your content is optimized in search engines.

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In March 2009, the Ontario Superior Court of Justice had occasion to consider the scope of the presumption under the Copyright Act of an employer's ownership of copyright in works created by an employee in the course of his employment.

The case of Corso v. NEBS Business Products Limited [(2009) 176 A.C.W.S. (3d)] involved a claim for wrongful dismissal by Mr. Corso, and a counterclaim by the employer NEBS Business Products Limited (NEBS), for a declaration that it was the owner of copyright in certain materials created by Mr. Corso, largely on his own time.

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