Friday, February 23, 2024

Access Copyright Adds To Its Lengthy Litany Of Litigation Losses

It is easy to lose track of how many major decisions that Access Copyright has LOST in the last twenty years, which include three straight losses in the Supreme Court of Canada (CCH in 2004, Alberta in 2012, and York in 2021) and now a very notable Federal Court decision that is likely to be upheld in any appeal.

The latest is the landmark ruling by Justice Aylen of the Federal Court in Province of Alberta et al v. Access Copyright 2024 FC 292, rendered February 22, 2024.

I have quoted at length from Justice Aylen’s ruling because it is very long (121 pages) and detailed and will be a challenge even to experienced copyright lawyers to read carefully on short notice. For whatever reason, it does not have a table of contents. But it is a “must read” for every copyright lawyer, educator and copyright policy official in Canada. It was issued very quickly and decisively, following final arguments just over a month ago on January 17 and 18, 2024. At times in this blog, I refer to Access Copyright as “AC”. I refer to the plaintiffs, Province of Alberta et al, as the “Consortium”.

 Justice Aylen states the issues, as agreed by the parties, at the outset:

 

[3] The parties have brought a motion for summary trial in which they have jointly asked the Court to answer the following three questions:

1. Have the Plaintiffs been licensees from 2013 onward?

2. If the Plaintiffs have not been licensees from 2013 onward, are the Plaintiffs nevertheless liable in equity to pay Access Copyright?

3. If the Plaintiffs are not liable in equity to pay Access Copyright, is Access Copyright entitled to retain the 2010-2012 overpayment in any event?

 Spoiler alert – here is the bottom line of the ruling at page 121:

THIS COURT ORDERS that:

1. It is declared that the Plaintiffs overpaid Access Copyright for tariff royalties during the years 2010, 2011 and 2012 by an amount equal to $2.35 per full-time equivalent student [Overpayment]. The total amount of the Overpayment as paid by each Plaintiff, exclusive of pre-judgment and post-judgment interest and inclusive of the Copyright Board-set interest factor and taxes, is as set out in Schedule B to the Statement of Claim.

2. It is declared that the Plaintiffs were not licensees of the Approved 2010-2015 Tariff from 2013 to 2015.

3. It is declared that the Plaintiffs are not liable to Access Copyright in equity, or otherwise, in relation to any of the claims advanced by Access Copyright in this proceeding.

4. It is declared that Access Copyright is not entitled to retain the Overpayment.

5. Access Copyright shall pay to each of the Plaintiffs a refund of the Overpayment, in the amounts as set out in Schedule B to the Statement of Claim.

6. Access Copyright shall pay to the Plaintiffs pre-judgment interest on the Overpayment, calculated pursuant to subsection 36(1) of the Federal Courts Act.

7. Access Copyright shall pay to the Plaintiffs post-judgment interest on the Overpayment, calculated pursuant to subsection 37(1) of the Federal Courts Act.

8. Access Copyright shall pay to the Plaintiffs their costs of this motion and the underlying proceeding calculated based on the mid-point of Column III of Tariff B [the Tariff], with the exception of the documentary production costs which shall be calculated based on the mid-point of Column IV of the Tariff.

9. Access Copyright shall pay to the Plaintiffs their reasonable disbursements of the motion and the underlying proceeding. In the event that the parties are unable to reach an agreement, the disbursements shall be assessed by an assessment officer.

10. Access Copyright’s counterclaim is hereby dismissed.

 “Mandy Aylen”

Judge

 

The essence of the Consortium’s claim as stated by Justice Aylen in the very lengthy and detailed recitation of facts was this:

 

[36] On February 16, 2018, prior to the Supreme Court’s decision in York University, the Plaintiffs commenced this action against Access Copyright seeking, among other relief: (a) a declaration that Access Copyright’s tariffs as certified by the Board are not mandatory; (b) a declaration that the Plaintiffs overpaid Access Copyright for the years 2010, 2011 and 2012 by an amount equal to $2.35 per FTE student; and (c) payment by Access Copyright of a refund or monetary damages to the Plaintiffs in the amount of the overpayment, namely $25,493,109.36, together with pre-judgment and post-judgment interest. (highlight added)

 Further:

 

[83] In a letter dated May 4, 2016 [2016 Letter], the Plaintiffs requested a refund from Access Copyright of the difference between the per FTE student rate of $4.81 that was paid in 2010 through 2012 under the continuation tariff and the $2.46 per FTE student rate that was ultimately certified, in accordance with section 15(5) of the Approved 2010-2015 Tariff. The total amount sought by the Plaintiffs was $25,493,109.36. (highlight added)

 

Note that this figure does NOT include interest due.

 This is a  lot of money but the matters of principle are even more important. Justice Aylen pays significant attention and reliance on the Supreme Court’s 2021 decision in the York case, which came down in the midst of this litigation, and the SCC’s 2015 decision in CBC v. SODRAC. I was counsel for CARL in both these cases. I acted for David Lametti, as he then was, and Ariel Katz in the SODRAC case, and made complementary submissions to Ariel Katz in the York case. The York decision relied on the brilliant scholarship of Ariel Katz in his “Spectre I” and “Spectre II” papers. I am proud to have worked with Ariel over the years to demolish the myth of the “spectre” of mandatory tariffs. He deserves the main credit.

 AC’s main argument was that it was entitled, based on the very amorphous mostly common law of “equity”  and other stretches of the common law, to keep this money. But the Copyright Act does not provide for equitable relief for an entity such as AC that is neither a rights owner or exclusive licensee. She rules that:

 

[259] Accordingly, I find that none of Access Copyright’s asserted common law doctrines apply so as to prevent the Plaintiffs from seeking a return of their royalty overpayments.

 

Justice Aylen has some scathing findings re other aspects of AC’s submissions:

 

[192] While this is sufficient to dispose of Access Copyright’s meritless assertion that participating in the tariff-setting process at all levels (before the Board, this Court, and the Federal Court of Appeal) constituted an offer to pay, the rationale for why the Plaintiffs would have participated sheds further light on the absurdity of Access Copyright’s assertion. At the relevant time, the Supreme Court had not yet decided York University, so it was possible that the Plaintiffs would be bound to a statutory licence. If that were ultimately the case, it is obvious that it was in the Plaintiffs’ interests to participate and advocate for a tariff lower than the one being proposed by Access Copyright ($15.00 for 2010 to 2012 and $9.50 for 2013 to 2015), which was an increase of $10.19 and $4.69 per FTE over and above the royalty under the Approved 2005-2009 Tariff.  (highlight added)

 

[224] To interpret the Copyright Act as allowing equitable remedies that permit recovery of a remedy provided for under subsection 68.2(1), but not otherwise available to Access Copyright under the Copyright Act (because the Plaintiffs were not licensees), would be incompatible with the object of the Copyright Act and result in absurdity. Parliament has struck a careful balance between users’ and creators’ rights, as well as with respect to the risk of collective societies developing monopolistic powers. In striking that balance, Parliament chose to make statutory licenses voluntary. To permit Access Copyright to obtain through equity what it cannot obtain under the Copyright Act would turn the copyright regime on its head, by effectively making voluntary statutory licences mandatory through the use of equitable remedies. Under the circumstances, it is “irresistibly clear” that the statutory scheme precludes Access Copyright from seeking the equitable remedies it claims in the circumstances of this proceeding [see Moore, supra at para 70]. (highlight added)

 

[227] This concern lays bare one of the problems with Access Copyright’s equitable claims. While Access Copyright has gone to great lengths to assert in its submissions that it is not making an infringement claim (notwithstanding the language used in its pleading), Access Copyright grounds its equitable claims in the Plaintiffs’ acts of compensable copying. But compensable copying in the absence of a licence is merely an act of infringement—an unauthorized exercise of the owner’s exclusive right. As stated by the Supreme Court in York University, a person who has not paid or offered to pay is not licensed and may be liable for infringement. To permit Access Copyright to obtain an equitable remedy for compensable copying would have the effect of using equity to make the tariff de facto mandatory or permitting Access Copyright (a non-exclusive licensee) to recover for infringement, either of which would turn the copyright regime on its head. (highlight added)

 

[228] Through its equitable claims, considered collectively, Access Copyright ultimately seeks payment by the Plaintiffs of an amount equivalent to the royalties the Plaintiffs would have owed had they been licensees, which would result in the inequities and absurdities addressed above. (highlight added)

 

[229] For these reasons, I conclude that, in the circumstances, it is not open to this Court to award the equitable remedies sought by Access Copyright as to do so would turn the copyright regime on its head. (highlight added)

 

[273] For the reasons stated above, my determination in relation to each of the issues is as follows:

1. Were the Plaintiffs licensees in 2013, 2014 and 2015? No.

2. If the Plaintiffs were not licensees from 2013 to 2015, are the Plaintiffs nevertheless liable in equity, or otherwise, to pay Access Copyright an amount equivalent to the tariffs royalties for 2013 to 2015? No.

3. If the Plaintiffs are not liable in equity, or otherwise, to pay Access Copyright an amount equivalent to the tariff royalties for 2013 to 2015, is Access Copyright entitled to retain the 2010 to 2012 overpayment in any event? No.

 

As to costs, Justice Aylen rules:            

 

[296] Accordingly, I find that the Plaintiffs are entitled to their costs to be calculated in accordance with the mid-point of Column III of the Tariff for all steps in this proceeding, other than documentary production steps which shall be calculated in accordance with the mid-point of Column IV of the Tariff.

 My overall assessment:

 

1.      This ruling is  incredibly important, detailed, meticulous, and comprehensive. It reviews the evidence, the arguments, and the applicable case law in unusual and commendable detail.

2.      I would say, in my opinion and based upon my long experience, that any appeal by AC is unlikely to succeed.

3.      Needless to say, an affirmation by the Federal Court of Appeal would be even further devastating to Access Copyright.

4.      Moreover, any appeal might spark a cross appeal as to costs, which is the one aspect where AC got some sympathy. Column 3 costs, as awarded to the Consortium, are at most a small fraction of actual costs.

5.      Although his cases technically began in 2018, there was a lengthy leadup between the parties at the Copyright Board and in the lobbying corridors. The Consortium deserves credit  for fighting for justice for Canadian educators for so long.

6.      This ruling is anything but shocking. It confirms that Canada, like the USA, does NOT have mandatory tariffs and that fair dealing is important and a key aspect of the copyright bargain.

7.      Given the recent downsizing and restructuring of AC and the departure of Roanie Levy, it will be interesting to see if it now takes a less aggressive litigation approach or doubles down and becomes even more aggressive.

 Finally, this case provided an interesting contrast in advocacy and approach:

·       AC’s positions were very aggressive and sought to turn the Copyright Act “on its head”, as the ruling repeatedly states. AC’s oral advocacy, as led by Sarit Batner of McCarthy’s, was very dramatic, perhaps even melodramatic and too much so, even allowing for the “meritless” and “absurdity” aspect of many of AC’s key submissions..

·       The Consortium’s positions and oral advocacy, led by Aidan O’Neill of Fasken,  were much more restrained, concise, and even understated. In the result, this approach was clearly far more convincing in this instance.

 

Let me remind readers, as  always, that nothing in this blog is legal advice.

 HPK

Note: I've corrected the above to reflect that the final arguments were on January 17 & 18, not February 17 & 18.

Monday, January 22, 2024

Province of Alberta et al v Access Copyright - Court File T-326-18

 I watched with great interest the two-day summary judgment hearing on January 17 and 18, 2024 in Province of Alberta et al v. Access Copyright. This particular proceeding has been going on for almost five years, and the overall confrontation between these parties for much longer. I would expect, with the inevitable appeals, that it could go on potentially for years to come. There is much that I could say about all this, but I won’t say it now.

I will, however, say this. For the purpose of its so-called equitable claim in this litigation, Access Copyright argued in court that the 2012 amendment to the Copyright Act adding the word “education” to fair dealing was not significant – since it wants to assert that the educators had no basis to rely on greater fair dealing rights and somehow, via equity, should be forced to pay up for their allegedly uncompensated use since then. As Access Copyright wrote in its memorandum for the court, “In sum, as the Plaintiffs themselves made clear, nothing within the Copyright Modernization Act converted fair dealing into free dealing.”

 On the other hand, Access Copyright is loudly and flagrantly contradicting this position outside the court room in its aggressive campaign to get rid of the word “education”, since it asserts on the lobbying front that the addition of this word education has cost it over $200 million dollars.

e.g. “TORONTO [July 13, 2023] Due to changes in fair dealing provisions in the Copyright Act, since 2012, Canadian writers, visual artists, and publishers - an indispensable part of Canada’s culture - have been deprived of over $200 million in unpaid royalties under tariffs certified by the Copyright Board of Canada”

Taking contradictory positions in different forums at the same time is, at the very least, unusual and potentially problematic. Go figure.

BTW, the educators relied very heavily on the SODRAC and York decisions from the SCC, wherein the submissions of Prof. Ariel Katz, Prof. David Lametti as he then was in the SODRAC case, and myself were determinative.

HPK


Thursday, October 19, 2023

Province of Alberta et al v. Access Copyright, Federal Court T-326-18 - Next Steps in Summary Trial Motion

 For those following the proceedings in Province of Alberta et al v. Access Copyright, Federal Court T-326-18 (the K-12 proceeding), which I wrote about on October 5, 2023, here is what to expect following the conclusion of the opening statements and evidentiary phase of the summary trial motion. This is the Direction of the Federal Court from presiding Justice Aylen dated October 17, 2023:

Ottawa, Ontario

K1A 0H9

October 17, 2023

BY EMAIL ONLY

Counsel for the Plaintiffs:

Wanda Noel wanda.noel@bell.net, wanda.mary.noel@gmail.com

Ariel Thomas law@arielthomas.ca

J. Aidan O’Neill aoneill@fasken.com

Alexandra Logvin alogvin@fasken.com

Counsel for the Defendant:

Sarit Batner sbatner@mccarthy.ca

Barry B. Sookman bsookman@mccarthy.ca

Daniel G.C. Glover dglover@mccarthy.ca

Laura E. MacDonald lmacdonald@mccarthy.ca

Allison Spiegel aspiegel@mccarthy.ca

RE: THE PROVINCE OF ALBERTA ET AL v. THE CANADIAN COPYRIGHT

LICENSING AGENCY

Court File No: T-326-18

This will confirm the Directions of the Court (Madam Justice Aylen) issued on October

17, 2023

“The following timetable shall apply to the closing arguments on the summary trial motion:

(a) Access Copyright shall serve and file their further written representations (which shall

not exceed 60 pages in length, without leave of the Court) by no later than November 10, 2023,

which shall replace their original written representations.

(b) The Plaintiffs shall serve and file their further responding written representations

(which shall not exceed 60 pages in length, without leave of the Court) by no later than

December 4, 2023, which shall replace their original written representations.

(c) Access Copyright shall serve and file any reply written representations by no later than

December 18, 2023.

(d) The oral closing arguments shall be held, in person, at the Federal Court in Toronto

on January 17 and 18, 2024 commencing at 9:30 am (Eastern).

(e) The parties shall ensure that their further representations address, among other things,

the following issues:

a. Who bears the burden of proof on each issue;

b. How the limitation period issue factors into each of the three issues put forward by the

parties, if at all;

c. Substantive submissions on the asserted limitation bar (including in relation to any

equitable relief), with reference to the relevant evidence (such as the presence or absence of

FTE forms, FTE reporting, invoicing, etc.);

d. Can someone “offer to pay” under the Copyright Act by way of their conduct?

e. Where the Court finds the terms of the licence that Access Copyright asserts that the

Plaintiffs offered to pay for;

f. The distinction between the tariff and a licence, if any;

g. What documents shed light on the parties’ understanding of the term of the licence

that Access Copyright asserts that the Plaintiffs offered to pay for (annual, 3 years, 6 years);

h. Did the Copyright Board amalgamate the two proposed tariffs or simply hear them

together? What impact, if any, does this have on the term of the licence?

i. How, if at all, the principles applicable to oral contracts come into play in establishing

the terms and conditions of the licence that Access Copyright asserts that the Plaintiffs offered

to pay for;

j. How does a continuation tariff impact the term of the asserted licence, if it all;

k. Is there an ability to terminate the licence that Access Copyright asserts that the

Plaintiffs offered to pay for and if so, on what basis and where does that ability come from?

l. Clear submissions as to the evidence relied upon and theory of liability for Access

Copyright’s assertion that the Plaintiffs offered to pay for a licence for each of 2016, 2017,

2018, 2019, 2020, 2021, 2022 and 2023;

m. Is Access Copyright asking the Court to find that the Plaintiffs have engaged in serial

infringement and if so, what evidence supports that assertion?

n. To grant the equitable remedies sought by Access Copyright, does the Court need to

make a finding of infringement?

o. What use can be made of the Copyright Board’s decision and the 2005-2006 volume

study on the issue of infringement;

p. Can the Court consider the agreement between the parties regarding the uses to be

made of the volume study? If so, is this proceeding off-side that agreement?

q. Can the Plaintiffs assert a lack of clean hands on the part of Access Copyright given

the state of the Plaintiffs’ pleadings?

r. Whether Access Copyright has standing to assert each form of equitable relief sought;

s. Whether equitable relief is available under the Copyright Act and if so, pursuant to

which provision(s) thereof;

t. The framing of issue 3 and whether a claim for equitable set-off can be made out if the

answer to issue 2 is “no”; and

u. The specific relief sought by each party in the form of a draft order.”

Yours truly,

Aline Longin

Registry Officer

(highlight added)

 

Thursday, October 05, 2023

I asked ChatGPT "What are the copyright issues involved with generative AI?"

 So - I asked ChatGPT "What are the copyright issues involved with generative AI?".

Here's its answer. Not bad for the price and the instant response time...😉:

ChatGPT

Generative AI, which includes models like GPT-3 and similar technologies, can raise several copyright issues and legal considerations. It's important to note that copyright law can vary from country to country, so it's essential to consult with a legal expert for specific advice. However, here are some general copyright issues and concerns related to generative AI:

  1. Ownership of Generated Content: One of the primary copyright concerns is determining the ownership of content generated by AI. In many jurisdictions, the creator of a work holds copyright over it. But when AI generates content, there is no human creator in the traditional sense. This raises questions about whether the AI developer, the user of the AI, or both have rights to the generated content.
  2. Fair Use and Transformative Use: Copyright law often permits the use of copyrighted material under the doctrine of "fair use" (or similar concepts in different legal systems). Whether AI-generated content qualifies as fair use or a transformative use can be a complex legal question. It depends on factors like the purpose of the use, the nature of the copyrighted work, and the amount used.
  3. Training Data and Pre-existing Copyrighted Material: The data used to train generative AI models often includes copyrighted material. The model may inadvertently generate content that resembles or replicates this copyrighted material. This can lead to copyright infringement claims.
  4. Licensing and Permissions: Users and developers of generative AI should consider obtaining appropriate licenses or permissions when using copyrighted materials to train models or generate content, especially when using it for commercial purposes.
  5. Attribution and Plagiarism: When AI generates content, it may not provide proper attribution to the original sources of information or ideas it used to generate that content. This can lead to plagiarism concerns and copyright disputes.
  6. Derivative Works: Generative AI can create derivative works based on existing content, which can infringe upon the original copyright if not properly licensed or transformed.
  7. Public Domain and Open Source: It's important to distinguish between copyrighted and public domain or open-source content. Content generated by AI based on public domain or open-source materials may have different legal considerations.
  8. User Responsibility: Users of generative AI are responsible for the content generated by the AI they use. They should be aware of copyright laws and ensure that they are not infringing on the rights of others.
  9. Case Law and Legal Developments: Copyright law is still evolving in response to AI and machine-generated content. Courts and lawmakers are continually addressing these issues, so it's essential to stay informed about legal developments in this area.

In summary, the copyright issues surrounding generative AI are complex and evolving. It's crucial for AI developers, users, and content creators to be aware of these issues, seek legal advice when necessary, and ensure compliance with copyright laws and regulations in their jurisdiction. Additionally, it's essential to consider ethical considerations related to the use of AI-generated content and its potential impact on creators and the creative industries.

 

K-12 School Boards v Access Copyright & Vice Versa - October 10, 2023 Federal Court Summary Trial

In 2018, the Province of Alberta and dozens of K-12 school boards sued Access Copyright for a refund of $25 million they allegedly overpaid for Access Copyright licences for 2010, 2011 and 2012.

Access Copyright, on the other hand, has defended and  counterclaimed for a potentially much larger amount based upon subsequent Copyright Board tariffs.

Of course, as we all know, the Supreme Court of Canada ruled in 2021 that Access Copyright’s Copyright Board tariffs are not “mandatory”. See York University v. Canadian Copyright Licensing Agency (Access Copyright), 2021 SCC 32 (CanLII), <https://canlii.ca/t/jh8bc>

In a complex proceeding, namely Federal Court T-326-18, the parties have agreed that the main issues are as follows;

Issue #1: Have the Plaintiffs been licensees from 2013 onwards? (If so, the Plaintiffs shall pay the Access Copyright tariff in respect of the years in which they were licensees; if not, Issue #2 must be determined).

Issue #2: If not, are the Plaintiffs nevertheless liable in equity to pay Access Copyright? (If so, the Plaintiffs shall pay the Access Copyright tariff in respect of the years in which equity bound them; if not, Issue #3 must be determined).

Issue #3: If not, is Access Copyright entitled to retain the 2010-12 overpayment in any event? (If not, the Plaintiffs are entitled to a refund of overpaid royalties).

The case will be heard by way of “summary trial” on October 10, 2023 for seven days – which is interesting given the voluminous record and the lengthy proceedings to date. Those interested in observing can request to login virtually using this link:

https://www.fct-cf.gc.ca/en/court-files-and-decisions/hearing-lists

and doing a search for file # T-326-18. The request should be made soon.

There are some prominent counsel involved. This should be worth watching.

HPK

Tuesday, August 08, 2023

Access Copyright’s Conspicuous Copyright Canards as Enabled and Empowered by the Globe and Mail

The Globe and Mail has recently published three misleading and seriously inaccurate opinion pieces about Canadian copyright law from authors who should know better, given their backgrounds. They are from Kate Taylor dated May 26, 2023August 2, 2023 and Hugh Stephens, July 15, 2023One might have expected better basic fact checking from what is supposedly Canada’s “national newspaper” and/or “newspaper of record” of conspicuous copyright canards.

Both authors advocate for changing Canada’s copyright law to impose potentially great mandatory costs on the post-secondary education (“PSE”) sector in favour the very controversial and arguably obsolete organization known as Access Copyright (“AC”), which purports to collect royalties for the reproduction of its members works by organizations such as governments and PSE institutions.  Mr. Stephen’s opinion piece conveniently follows up just two days later on the announcement by Access Copyright (“AC”) that it was downsizing and restructuring. This all seems to be highly orchestrated by AC. And Yahoo News  republished a pathetic press release from Access Copyright.

Both the Globe and Mail and the National Post have failed to respond to my op-ed submissions. Maybe they both are myopically sympathetic to the copyright maximalists? Have these bastions of Canadian Main Stream Media (“MSM”) drunk too much of the copyright Kool-Aid? How independent or professional is the Canadian MSM anymore? The glory days of Canadian op-ed pieces in MSM sadly ended a long time ago.

AC has indeed seen its revenues drop since 2012 but falsely blames this on the purely coincidental amendment that year of the fair dealing provisions of Canada’s Copyright Act that added the word “education”. However, there is no factual or legal basis to suggest that this amendment has had anything whatsoever to do with AC’s deservedly declining fortunes.

The users’ fair dealing rights relied on by the PSE sector have been in place for more than a century since at least 1921 and have been affirmed and confirmed by numerous judicial decisions, including four from the Supreme Court of Canada since 2004. These include two from 2012 and one from 2021 that were not based on the 2012 amendment.

The Americans have seen “fair use” (counterpart to “fair dealing”) rights hardwired into their law since 1976 for “teaching (including multiple copies for classroom use), scholarship, or research…”. There is no reason for Canadian educators and students to be at a comparative disadvantage to their American counterparts, especially when American publishers are perhaps the main driving force behind AC. Moreover, Americans would choke at the socialist notion of “mandatory” copyright tariffs, which Canada’s Supreme Court categorically rejected in 2021 based in large measure on my submissions on behalf of the Canadian Association of Research Libraries.

Since 2012, the Canadian PSE sector has been spending far more and far smarter on fair payments for authors by way of licences, acquisitions of print or digital material, and targeted procedures to ensure that deserving authors get actually paid. AC is arguably the worst possible vehicle to ensure such payments. Its non-transparent repertoire is mostly irrelevant in the PSE sector. Former U of T Dean of law Marin Friedland exposed the problems of AC’s methodology in 2007 and there has been  no apparent evidence of improvement. The bottom line is that AC has long ceased to offer any useful value for its PSE licences.

The kind of changes that that AC and its supporters are calling for may very well be not only unwise but also unconstitutional.  Education, as well as property and civil rights, are provincial jurisdiction. Freedom of expression is guaranteed by the federal Charter.

What Lies Ahead

We have just had a cabinet shuffle. Sadly, shamefully, and for no apparent reason other than cynical electoral optimization, the Hon. David Lametti, Minister of Justice, has been dumped out of cabinet by PM Justin Trudeau. While copyright was never directly part of Lametti’s portfolio, he was by far the most legally learned member of the current Government and Minister of Justice for a very long time. His potentially moderating and deeply informed influence will be missed. Ms. Taylor has implied that his expertise in copyright may have led to him being pushed from cabinet. She writes: “Coincidentally, another cabinet change might help get the job done. Publishing insiders have long suspected one roadblock was former justice minister David Lametti, known as a supporter of so-called users’ rights." Prior to his public service, he was a highly respected academic at McGill law school and certainly a leading expert in copyright, as I know from working with him on an important Supreme Court of Canada case just before he was elected in 2015 and even long before.

And we now have Pascale St-Onge replacing Pablo Rodriguez as Heritage Minister. Her CV will play out very well in Quebec, from whence all of Trudeau’s previous Heritage Ministers have not coincidentally hailed. She and Trudeau are plainly pandering to a Quebec audience first and foremost. However, if Minister St-Onge is well advised, she will realize that copyright law is not a Quebec based hill or bill to die on. She might wish to ask Sheila Copps, Sarmite Bulte, and others about that.

The other responsible minister, who actually should be primarily in charge of copyright law and policy, is F-P Champagne of Innovation, Science and Industry. He has apparently been missing in action on this file but remains in place in cabinet. He may be mindful that the copyright file is presumptively toxic and is best avoided, if possible, especially for someone who may have leadership aspirations. AC is now targeting him in a mass email to its affiliates, on its website,  and doubtlessly directly.

Sadly, we will likely see policy on these issues dictated by “kids in short pants” at the PMO and even the apparently too politicized PCO – who have little or no substantive expertise and only care about politics and career aspirations. We could see a replay of Bill C-18 with some kind of bogus superficial “adjacent’ or “neighouring right” pretext for forcing a mandatory tariff for rights that don’t exist onto the PSE sector, to be paid for by Canadian provinces and ultimately Canadian students. The financial cost could be huge and the chill on Canadian education, research and private study ultimately even more costly. All this to enable Access Copyright to spend a fortune on salaries, lawyers, lobbyists – and to distribute what amounts to once-a-year lunch money to many if not most of its creator affiliates?

For better or worse, there is no sign that anyone, such as Google, is going to challenge the constitutionality of Bill C-18 in court, even though very credible commentators such as Konrad von Finckenstein and Phillip Palmer have done so in writing.

Above all, the educational sector and other user groups need to step up to the plate. Universities Canada has failed to provide satisfactory leadership on copyright for at least three decades. Hopefully, this could change with a new president – but I’m not holding my breath. U of T’s revised fair dealing guidelines are a step backwards. Canada’s “U15” group of leading research universities needs to speak forcefully. We need to see the PSE academy and responsible smaller organizations with less resources but more insight, ability, and agility step forward and write their own op-eds (assuming the MSM might publish them), do their own effective lobbying (i.e. actually meeting with Ministers), and develop their own updated fair dealing guidelines.

***

Howard Knopf is a policy provocateur who, after 43 years, is no longer “practising law”. He has argued four very influential interventions in copyright cases in the Supreme Court of Canada. He is an active blogger on copyright and related issues and is an affiliate of Access Copyright.

 

Wednesday, July 26, 2023

The Shrill Shrieking of Access Copyright and the Coming Copyright Confrontation

For the second time in recent weeks, the Globe Mail – supposedly Canada’s “newspaper of record” - has published highly misleading and embarrassingly over the top op eds from authors who really should know better, given their notable backgrounds. No doubt they mean well and aren’t beholden to Access Copyright – but their opinions are so over the top and poorly informed that they have a very bad look:

Kate Taylor, May 26, 2023

Hugh Stephens, July 15, 2023

Hugh Stephens’ opinion piece conveniently follows up just two days later on the announcement by Access Copyright (“AC”) that it was downsizing and restructuring.

And this, from the shrill Quill and Quire piece dated July 19, 2023.

First, let’s get some big misunderstandings (including what some might say are “big lies”, but I presume no deliberate intent to prevaricate or be mendacious) off the table. More detail follows below:

  • AC does NOT collect for the mainstream of creators whose works are used in the Post Secondary Education (“PSE”) sector. It is believed to mainly represent authors of Canadian literature, which is a fringe area overall in the curricula of the PSE sector. AC’s actual repertoire remains something of an impenetrable black hole. Full disclosure – I’m a member and earn enough for one very modest lunch a year – which is more than some serious academic friends of mine.
  • AC’s incompetence and inability to fairly distribute its revenues to its creators has been known and documented for a long time, most famously in the 2007 report by Martin Friedland, former Dean of U of T Law School. There is no apparent reason to believe that things have significantly improved since then.
  • The decline in AC revenues over the last 11 years had NOTHING to do with the 2012 legislation that added the word “education” to s. 29 of the Copyright Act. The users’ fair dealing rights relied on by the PSE sector have been in place for more than a century since at least 1921 and have been affirmed and confirmed by countless judicial decisions, including four from the Supreme Court of Canada between 2004 and 2021, including the two of the 2012 “pentalogy” decisions and the 2021 York decision, that were not based the 2012 amendment.
  • The basic right of “fair use” (American counterpart to fair dealing) has been hardwired into US law since 1976, i.e. “teaching (including multiple copies for classroom use), scholarship, or research”. See 17 USC 107. There is no imaginable reason for Canadian educators and students to be at a comparative disadvantage to their American counterparts, especially when American publishers are a driving force – maybe even the main driving force - behind AC.
  • Since 2012, the Canadian PSE sector has been spending far more and far smarter on fair payment for authors by way of licenses of various kinds, acquisitions of print or digital material, and targeted procedures to ensure that deserving authors get paid. See this, for example, from CARL.  It’s just that AC is apparently the worst possible vehicle to ensure such payment. We don’t use a stagecoach anymore to get from Ottawa to Toronto – and there are no “mandatory tariffs” that require using one source or method of getting to there from here – especially via stagecoach.
  • AC was born and nourished by a sweetheart deal with the Federal Treasury Board in 80’s. It has been protected since then by the Feds the Copyright Board – but any justification for such protection, if it ever existed, has long expired.
  • The bottom line is that AC offers virtually no value at any price for its PSE licenses. And, of course, these “licences” are NOT MANDATORY.

Some History:

Once upon a time Access Copyright was known as CanCopy – until I and others inspired by former York University President Harry Arthurs - nicknamed it “Can’t Copy” – which was much more accurate.

My own blog is called Excess Copyright – a name inspired by Access Copyright.

Well, it seems that “excess” has not served Access Copyright (“AC”) very well. AC has excessively overreached with respect to:

  • Demanding excessive FTE payments for PSE students
  • Blaming the Conservative government for the 2012 (“Copyright Modernization Act” “CMA”) amendment that added the word “education” to the fair dealing purposes in the Copyright Act
  • Blaming the Liberal Government for not undoing this innocuous amendment, which has not resulted in any extension of users’ fair dealing rights not already explicitly blessed by three Supreme Court of Canada (“SCC”) decisions based on the law prior to the CMA
  • Purporting to have actual repertoire that is of any significance overall on the PSE system. AC’s actual repertoire – which is anything but transparent – is believed to consist mainly of Canadian literature. Such repertoire plays a minimal role in the PSE sector. Very few university and college graduates will ever be required to read Margaret Atwood, Alice Munroe or lesser literary luminaries in the course of their studies
  • Purporting to collect and remit payments for foreign repertoire
  • Refusing to meaningfully engage in transactional licenses, which are often successfully obtained from Acs overall more reasonable cousin in the USA, namely the Copyright Clearance Center
  • Barking noisily with no teeth to bite. Remember that AC has no standing to sue anyone for copyright infringement, since it is neither an assignee nor exclusive licensee of anyone. This was explicitly confirmed by the SCC in 2021 in the York case.

Once upon a time, AC was able to convince universities to hold their noses and pay a $3.38 FTE cost and offload the $0.10 per page “course pack” charge directly to students. Of course, paper course packs have gone the way of the horse and buggy. Moreover, the legally questionable “indemnity” that AC once offered that was an incentive to that dubious business model has long since been unavailable. I pointed out 24 years ago that AC never has been a licensed insurance company.

It will be recalled that for 2011-2013 AC wanted a mandatory FTE tariff to be set by the Copyright Board of (a) $45.00CAD for Universities; or (b) $35.00 CAD for all other Educational Institutions.

As AC excessively escalated its litigation strategy by then suing York University to enforce its “interim” tariff improvidently provided by the Copyright Board, from which no judicial review was sought due to the strategy of AUCC (now Universities Canada). While AUCC and York continued to spend money and go nowhere, some institutions realized that there was no need and no point in spending lots of money for little or no value. Ariel Katz started in his “hall of fame” and “hall of shame” list. He and I blogged at length about why tariffs should not be mandatory.

Ariel and I, along with a very smart young law professor named David Lametti, who later became Minister of Justice, made the prevailing arguments in the SCC in the 2015 case of
Canadian Broadcasting Corp. v. SODRAC 2003 Inc., 2015 SCC 57 (CanLII), [2015] 3 SCR 615, <
https://canlii.ca/t/gm8b0> namely that:

[113] I find that licences fixed by the Board do not have mandatory binding force over a user; the Board has the statutory authority to fix the terms of licences pursuant to s. 70.2, but a user retains the ability to decide whether to become a licensee and operate pursuant to that licence, or to decline.

That message did not, however, sink in to AC, AUCC or York. Instead, after years more of unnecessary litigation, during which York unnecessarily and unwisely “bet the farm” on the very poor AUCC fair dealing guidelines,  the SCC finally made it sufficiently explicit that AC’s tariffs are NOT MANDATORY in the PSE sector or elsewhere. Naturally, where tariffs are de facto in contrast to de jure mandatory, e.g. SOCAN tariffs for radio and TV stations, users will still keep on paying and the Copyright Board will hopefully do a much better job than it has done in recent decades of adjudicating any disagreements quickly and correctly.

Fast forward to the landmark SCC York decision in 2021 wherein York University very nearly snatched defeat from the jaws of victory but finally after 8 years fully and frontally faced the “mandatory tariff” and brought in the highly charismatic and ultra competent barrister Guy Pratte to adequately make the argument, at least on the “mandatory” issue, that York had effectively sidestepped before.

With all due credit to Mr. Pratte, my client CARL deserves full credit for empowering me to make the finally prevailing argument that:

  • Tariffs aren’t mandatory
  • Because the tariff isn’t mandatory, there was no live controversy about fair dealing that required the SCC to look at the bad AUCC/Universities Canada/York fair dealing guidelines devised by AUCC’s counsel years earlier.
  • While not necessary, the SCC at our behest did comment on some of the more egregious errors in the Courts below, e.g. re aggregate copyright.

Ariel Katz made his own supportive intervention that helped carry the day, ably presented by Sana Halwani.

Americans would shake their heads in total disbelief at the notion of a “mandatory tariff”, which would be a poorly disguised Canadian subsidy masquerading somehow as an authors’ “right” – like that $0.29 per blank CD we are forced to pay due to Copyright Board impotence (to be charitable) to prop up another long due for extinction collective, namely the CPCC.

Canada throws billions in subsidies at Volkswagen & Stellantis that will likely go down the toilet even if the EV bubble doesn’t burst soon given the competition from far more productive and efficient sources in China, Thailand or eve the USA….

Warning for Ministers

Do not pander to noisy demands from Quebec, where the mantra that more copyright is always better has caused mischief and damage for decades. If the Quebec government wants to shovel money at COPIBEC, let them. There is no reason for this folly to spread throughout Canada at the federal level.

Speaking of the federal level, the kind of changes that that AC and its supporters are calling for may very well be unconstitutional.  Education and property and civil rights are provincial jurisdiction. Freedom of expression is guaranteed by the Charter. There are many other issues. Proceed at your peril.

Liberal governments have tended to pander to copyright maximalists. But this hasn’t always had good results in either policy or politics. Ask Sheila Copps and Sarmite Bulte, for example.

What Lies Ahead

The current campaign of Access Copyright – and its gullible and shrill supporters ranging from Kate Taylor and Hugh Stephens to the usual and much  less credible suspects – should be disregarded by Government as the highly orchestrated public interest scam that it is.

And now  – we just now have had a cabinet shuffle. Sadly, Hon. David Lametti – Minister of Justice – is out. While copyright was never directly part of his portfolio, he was by far the most legally learned member of the previous Cabinet – or any cabinet for a very long time. His potentially moderating influence may be missed. He was certainly very knowledgeable about copyright – and was, as noted above,  involved in the important CBC v. SODRAC case that resulted in an important SCC decision that led up to the 2021 York decision.

And we now have Pascale St-Onge replacing Pablo Rodriguez as Heritage Minister. Her qualifications for this job include that she is from Quebec, played bass in a punk rock band, is the first out lesbian minister in Trudeau’s cabinet and was Minister of Sport. That’s enough to play out very well in Quebec, which is ultra-important to this government. Meanwhile, Pablo Rodriguez – who has left her with a huge mess – remains Quebec Lieutenant and is now, inexplicably, Minister of Transport. If Minister St-Onge is well advised, she will realize that copyright law is not a hill to die on. She might wish to ask Sheila Copps, Sarmite Bulte, and others about that.

The other minister, who should historically be primarily responsible for copyright law and policy, is FP Champagne of ISED, who remains in place. H may be mindful that the copyright file is presumptively toxic and is best avoided at all costs, especially for someone who may have leadership aspirations.

We wait in trepidation to see what the PMO will tell these ministers to do in  new mandate letters. The unfortunate breakdown of the old cabinet system and the centralization of policy making in a politicized and non-expert PMO means that professional public servants – whose policy influence has declined precipitously since the days of Pierre Trudeau – will be of little significance other than to make the PMO’s wishes their command.

Above all, the PSE sector and other use groups need to step up to the plate. Universities Canada cannot be counted upon for leadership. It has failed badly on this file for three decades – and particularly in the most recent. U of T’s new fair dealing guidelines are a major step backwards and are disappointing to most informed observers in the PSE sector. The retirement of U of T’s former general counsel Steve Moate has been a setback for balance and leadership within the influential “U15” group of leading Canadian research universities.

In searching for a new President, Universities Canada now has an opportunity to show more competence and leadership on these issues than it has in the las in the last three decades or so. Let us hope that that the right person can be found. However, this recruitment could take a while and the resulting course correction much longer in turn.

We need to see the responsible smaller organizations with less resources but more insight and ability step forward and write their own op-eds, do their own effective lobbying (i.e. meeting with Ministers), and develop their own updated fair dealing guidelines. Their silence after that Kate Taylor travesty was deafening. I believe that I was the only one who stepped forward and that was purely in my personal capacity.

We need to see a response to all of these big lies. Otherwise, given the absence of any competent ministerial leadership, we could be facing an impending debacle.

 HPK

 PS: A reminder that I was involved in litigation regarding Access Copyright and the CPCC for a long time. However, I am now “not practicing law”.