A look at what adjustments to copyright policy can be made through regulation, what needs legislative tweaking, and what’s brewing in the courts.
Once again – as mandated by legislation – the Copyright Act will be subject to review. This time around, a committee of the Senate or the House of Commons (or both) will supposedly take the lead rather than ministers, as was previously the case. However, the responsible ministers clearly can and likely will play a key role in this exercise, perhaps including appearing at committee hearings, providing expertise, and drafting any legislation or regulatory changes that may result from this process.
Overall, it remains a mystery how the review will unfold. Since the 2012 legislation was passed, only the Senate Banking, Trade and Commerce Committee has publicly shown any active and serious interest in the copyright dossier. This culminated with a very critical report in 2016 about the Copyright Board. Engagement by this Senate committee over the long term might be a positive development. There are some very sophisticated senators and most of them will be there for a long time to come, unlike ministers and senior officials, who inevitably come and go.
Ironically, the most pressing problems of copyright law in Canada today – namely the operation of the Copyright Board and the “notice and notice” regime (both discussed below) – can be dealt with outside of the review process, without legislation. The authority to implement the necessary regulations is already in place.
That is not to say that these issues won’t be or shouldn’t be dealt with in this process. However, regulations implemented pursuant to existing legislative authority do not require the involvement of Parliament. There is a mandatory process that includes consultation, but the responsible minister – in this case, Navdeep Bains, of Innovation, Science and Economic Development – can do essentially whatever he wants, as long as it is consistent with the legislation, without Parliament. (He would, of course, very likely consult with Minister of Heritage, Melanie Joly.)
Here’s my assessment of what can be changed through regulation, what might give rise to calls for legislative amendment, and what’s brewing in the courts and at the Copyright Board that might require a legislative response.
Fixing the Copyright Board through regulation
According to the Senate Committee Report, “The Copyright Board of Canada plays a pivotal role in Canada’s cultural sector. Yet, from what the committee heard, the Board is dated, dysfunctional and in dire need of reform.”
I would not go quite so far as to say that it is “dysfunctional.” Rather, it functions in a uniquely slow, costly, indecisive and increasingly unpredictable manner that that is inexplicable, unacceptable and unsustainable. It typically takes more than four years for the board to get to a hearing on a contested tariff, and at least another two years for a decision to be rendered. That decision is then inevitably retroactive for several years and too often requires and results in successful judicial review by the Federal Court of Appeal. Fortunately, as a result of the submissions of my clients (the Centre for Intellectual Property Policy and Ariel Katz), the retroactivity issue is now flashing on the Supreme Court’s radar screen. However, to avoid more uncertainty and litigation, this problem should be solved now with regulations.
The Copyright Board’s performance, as it is objectively measurable, does not stand up to comparison with the measurable performances of other tribunals, for example, the Competition Tribunal, which has even more complicated cases, a greater case load, and less resources.
I suggested to the Senate that most of what is wrong at the Copyright Board can be fixed quite easily through regulation, for example, introducing fixed timelines for all parties (and the board itself) to complete each procedural step. More resources and more study are absolutely not needed and not the answer. Legislation may be required in the long term to deal with “machinery” issues such as merging the board with another tribunal. However, this could take many years. Regulations can and should be implemented as soon as possible to deal now with the pressing problems with the board.
The “notice and notice” regime and regulatory solutions
Canada has a “notice and notice” regime, which allows copyright owners to require Internet service providers (ISPs) such as Bell and Rogers to forward notices to subscribers when it is alleged they have infringed copyright. The system is being abused by some companies that attach inappropriate and sometimes absurd settlement demands (even referring to American law) to the notices that ISPs believe must be forwarded to subscribers. Most – but not all – recipients of such notices have learned they can safely ignore these demands, and do not respond. Without a court order, an ISP cannot disclose a customer’s identity. Even the government tells subscribers that they don’t need to respond to these notices, and some responsible ISPs do provide this government link to their subscribers or otherwise inform them of their rights.
The government can and must implement regulations that forbid the inclusion of extraneous “settlement demands” in any such notices, or at least require the inclusion of prominent language informing the recipient of their right to simply not respond to the notice in any way and to ignore any settlement demand.
The government can also use its regulatory power to set maximum fees, so that ISPs can be reimbursed by copyright owners for the costs involved in complying with court-ordered disclosures of customer identities. This issue came to light in a May 9, 2017, decision from the Federal Court of Appeal in the controversial Voltage reverse class action litigation (which I discuss further below).
What if the legislation is opened up?
If the Act is opened up for substantive legislative revision, which may be neither necessary nor desirable at this time, here is what could be on table:
- Anticircumvention measures should be fixed in order to clarify that fair dealing exceptions are “always available,” even where circumvention of TPMs is involved. This would be consistent with the Supreme Court of Canada’s landmark decision in the CCH v. LSUC case in 2004. Any revision should remove the possibility of criminal liability for non-commercial (e.g., personal) circumvention.
- The possible use of “reverse class actions” against alleged infringers should be eliminated. In a case now pending in the Canadian Federal Court, Voltage Pictures, a powerful and litigious American film company, has attempted for the first time in Canadian copyright law to sue one individual on behalf of a class of supposedly similarly situated Rogers customers for allegedly illegal downloading of its movies. This appears to be the very first proposed “reverse class action” in the Federal Court and such proceedings are very rare in provincial superior courts. Curiously, nobody has yet challenged the basic viability of this “reverse class action” in these circumstances. It is very doubtful that Parliament ever intended the use of such “reverse class actions” in copyright cases. A simple amendment of the Federal Courts Rules, which would not require legislation, could potentially fix this problem at the Federal Court level. However, amendments to the Copyright Act, which would arguably be constitutionally valid, would presumably be required to preclude such proceedings in the provincial superior courts.
- The federal government should repeal the stealth amendments buried in an omnibus budget bill passed by the previous government in its dying days, which gratuitously extended the copyright term for sound recordings and performers’ performances from 50 years to 70 years. This was an undeserved windfall to the American recording industry and a triumph of lobbying over logic. The possibility of such a repeal could be an interesting bargaining chip in the NAFTA renegotiations.
- There will no doubt be attempts by content owners to roll back the 2012 legislation that explicitly included “education” as one of the permitted purposes of fair dealing, and the clear decisions in three Supreme Court of Canada cases starting from the landmark 2004 CCH v. LSUC on “fair dealing.” The Supreme Court has emphasized that fair dealing is a “users’ right” that is “always available” and must be given a “large and liberal interpretation.” Once again, we may see inaccurate references to comparative and international law. Clearly, the Canadian government should stand its ground and is indeed on very safe ground in terms of international law.
What is brewing in the courts and at the Copyright Board?
As always, there are some loose cannons in the form of pending cases that could generate calls for revisions to the Act after they are concluded or even while underway. Some of these cases could go on for years. In addition to some of the cases mentioned above, these could include the following:
- The copyright collective Access Copyright is seeking mandatory payment of $26 a year for every university-level full time or equivalent student, notwithstanding that most universities have put in place a good faith and reasonable fair-dealing policy, and they pay many millions overall for licenses that cover use that may go beyond fair dealing. This proposed tariff has been in the hands of the Copyright Board for more than seven years and remains undecided, despite the withdrawal of some institutional objectors such as the Association of Universities and Colleges of Canada (now Universities Canada). No decision is in sight on a final certified tariff.
- Because of the lengthy process anticipated in setting that final tariff, an interim tariff was imposed on universities in January 2011. The interim tariff is at the heart of the Access Copyright v. York University case that began in the Federal Court more than four years ago. The court is considering whether that interim tariff should be regarded as mandatory for universities, and also whether York’s fair dealing policies are viable. Many universities have ended their relationship with Access Copyright, as they pursue more affordable ways of clearing their copyright obligations (such as striking license deals with individual publishers).
- Music creators and publishers, represented by SOCAN, are arguing before the Copyright Board for a new “making available right,” i.e., that additional royalties should be paid when an Internet music service posts pieces of music online, whether or not that music is later downloaded or streamed. Arguably, the board could and should have simply sent this as a reference straight to the Federal Court of Appeal, where it will almost certainly end up anyway, only several years later than necessary.
The NAFTA and TPP wildcards
The NAFTA renegotiation, and the TPP negotiation (presumably minus the USA), are wild cards. One can only hope that Canada will stand its ground by, for example, refusing to agree to further term extension, caving in on fair dealing and accepting “notice and takedown” (a far more disruptive and much less Canadian version of the “notice and notice” system). However, American lobbyists will no doubt press for Canadian setbacks in the NAFTA discussions. Any concessions by Canada could take place outside of and without the benefit of the democratic debate we expect to occur in the forthcoming copyright review process.
Since Canada’s next federal election will take place on or before October 19, 2019, which is less than two years away from the start of the copyright review process this November, it’s unlikely that this government will have much enthusiasm to embark upon substantive changes to the legislation anytime soon, unless this becomes absolutely inevitable. Therefore, I would expect that the government will proceed to implement regulations as soon as possible to deal with the Copyright Board and the “notice and notice” regime. That would be a good first step, and it may be all that is seriously feasible or immediately necessary at this time.
This article is part of the Reviewing Canadian Copyright Policy special feature.
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