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Quarterly Copyright Blog - Q4

Quarterly Copyright Blog

For those who are interested in recent cases and developments about copyright and related matters, there have been several developments since the last entry.


Copyright in the Title of a Work

In John Winkler v. Nate Hendley 2021 FC 498, the Federal Court considered the definition of a “work” in section 2 of the Copyright Act, which provides that a “work includes the title thereof when such title is original and distinctive.” This does not make the title a separate work. Rather, it forms only part of the work as a whole. In addition, the requirement that a title be “distinctive” under the Copyright Act does not engage the same issues as it does in trademark law.


A Video Recording can be a Cinematographic Work

A video recording is protected as a cinematographic work when expressed by a process “analogous to cinematography.” Cinematography is the art of taking and producing films. Canadian Broadcasting Corporation v. Conservative Party of Canada 2021 FC 425.


When is a Work Created in the Course of Employment?

An English case, Penhallurick v. MD5 Limited [2021] EWHC 293 (IPEC), concluded there is no single test to be applied. Whether or not given acts were carried out in the course of employment for the purposes of section 13 is a multifactorial assessment to be based on all the circumstances. Usually, where an employment relationship has been conceded, there will be factors which point to the copyrighted work being created in the course of that employment and some factors which point otherwise. The factors may include:


(a) The terms of the contract of employment;

(b) Where the work was created;

(c) Whether the work was created during normal office hours;

(d) Who provided the materials for the work to be created;

(e) The level of direction provided to the author;

(f) Whether the author can refuse to create the work/s; and

(g) Whether the work is “integral” to the business.


When does a Court have Jurisdiction concerning Copyright Infringement?

In Pourshian v Walt Disney Company, 2012 ONSC 4840 (Divisional Court), the Court reviewed the appropriate approach to determining when a court has jurisdiction concerning alleged copyright infringement.


Where a defendant moves to set aside service ex juris on the ground that there is no real and substantial connection with Ontario, the question is whether there is a “good arguable case” that the connection exists. The path for determining whether there is a good arguable case is as follows:


“a. The statement of claim is the starting point for the analysis. Any allegation of fact that is not put into issue by the defendant is presumed to be true for purposes of the motion. The plaintiff is under no obligation to call evidence for any allegation that has not been challenged by the defendant.


b. However, where a pleading lacks sufficient particularity with respect to the required jurisdictional connections, the plaintiff bears the burden of supplementing the pleading with affidavit evidence establishing a connection.


c. Also, if the foreign defendant files affidavit evidence challenging the allegations in the statement of claim that are essential to jurisdiction, the threshold for the plaintiff to meet is that it has a "good arguable case" in respect of those allegations.”


The Supreme Court of Canada has established in Van Breda when dealing with tort claims the following framework for determining whether a court has jurisdiction over a claim brought against foreign defendants.


“a. First, the court must determine whether there is a presumptive connecting factor between the claim and the jurisdiction. In the context of a tort action, the Supreme Court identified the following presumptive factors:


i. The defendant is domiciled in the province;

ii. The defendant carries on business in the province;

iii. The tort was committed in the province; or

iv. A contract connected with the dispute was made in the province.


b. Second, if there is no presumptive connecting factor, the court is to determine whether a new presumptive connecting factor should be recognized. The Court identified the following relevant considerations to this determination:


i. Similarity of the connecting factor with the recognized presumptive connecting factors;

ii. Treatment of the connecting factor in the case law;

iii. Treatment of the connecting factor in statute law; and

iv. Treatment of the connecting factor in the private international law of other

legal systems with a shared commitment to order, fairness and comity.


c. Even if there is a presumptive connecting factor, the defendant can rebut the presumption by establishing facts “which demonstrate that the presumptive connecting factor does not point to any real relationship between the subject matter of the litigation and the forum or points only to a weak relationship between them.”


In SOCAN v. Canadian Association of Internet Providers 2004 SCC 45, the Supreme Court of Canada considered the jurisdiction of Canadian courts over the foreign entities that transmit music. The Court concluded that, while Canadian copyright law respects territorial distinctions, the applicability of the Copyright Act to foreign participants depends on whether “there is a sufficient connection between this country and the communication in question.” The real and substantial connection test should apply to determining whether Canadian courts have jurisdiction over a breach of copyright claim. The Court said that Canadian courts would generally have jurisdiction where Canada is the “country of transmission” or “the country of reception.”


While SOCAN was decided before Van Breda, SOCAN continues to be relevant and to assist in the analysis. It is not helpful to suggest that Van Breda dealt with tort claims and SOCAN deals with claims for copyright infringement. Copyright infringement is essentially a statutory tort. One of the presumptive connecting factors established by Van Breda is whether the tort was committed in the jurisdiction where the action is brought. When dealing with a claim for copyright infringement, the analogous presumptive factor is whether the alleged copyright infringement occurred in the jurisdiction where the action was brought.


In an action for a copyright infringement as established by the Supreme Court in SOCAN, the infringement can occur where the communication was transmitted from and received. Based on SOCAN and analogous analysis in tort claims, if the communication or product originated in another jurisdiction but is ultimately made available in Ontario, Ontario is one of the places where copyright infringement can occur.


The court also considered the location of the plaintiff’s copyright as a presumptive factor. While the Supreme Court in Van Breda did not explicitly list property in the jurisdiction as a presumptive connecting factor, the Ontario Court of Appeal has recognized the location of the property as a presumptive connecting factor. The judge said copyright should be recognized as having the same status as real property to determine jurisdiction.


No Copyright in Historical Facts

In John Winkler v. Nate Hendley 2021 FC 498, the Federal Court affirmed there is no copyright in the historical facts. The Court stated that where an author presents work as historically factual, they cannot complain in a copyright infringement action that a subsequent author has taken them at their word and relied on the facts they presented as being true. In other words, an author cannot seek to disprove their historical account and attempt to claim copyright over the “facts” contained in it because those facts are not true.


Such an approach is not helpful in light of the following comment made by the House of Lords in the Ladbroke [1964] 1 All E.R. 465 at 481 (U.K. H.L.) decision;


Did the defendants reproduce a substantial part of it? Whether a part is substantial must be decided by its quality rather than its quantity. The reproduction of a part which by itself has no originality will not normally be a substantial part of the copyright and therefore will not be protected. For that which would not attract copyright except by reason of its collocation will, when robbed of that collocation, not be a substantial part of the copyright. Therefore the courts will not hold its reproduction to be an infringement. It is this, I think, which is meant by one or two judicial observations that “there is no copyright” in some unoriginal part of a whole that is copyright. They afford no justification, in my view, for holding that one starts the inquiry as to whether the copyright exists by dissecting the compilation into component parts instead of starting it by regarding the compilation as a whole and seeing whether the whole has copyright. It is when one is debating whether the part reproduced is substantial that one considers the pirated portion on its own.


Notwithstanding the parties’ focus on “historical facts,” the Trial Judge correctly dealt with the observations set out above.


Proving Infringement

A court may infer infringement if a) there is substantial similarity such that the allegedly infringing work could be considered a copy or reproduction of the protected work; and b) the defendant had access to the protected work, which is sometimes called a “casual connection.” Patterned Concrete Mississauga Inc. v. Bomaite Toronto Ltd. 2021 FC 314.

Fair Dealing for the Purpose of Education

In Canadian Copyright Licensing Agency v. York University 2021 SCC 32, the Supreme Court of Canada clarified it did endorse the reasoning of the Federal Court or the Federal Court of Appeal on the fair dealing issue and sought to correct errors made.


The Courts below approached the fairness analysis exclusively from an institutional perspective. This error tainted their analysis of several fairness factors. By anchoring the analysis in the institutional nature of the copying and York’s purported commercial purpose, the nature of fair dealing as a user’s right was overlooked, and the fairness assessment was over before it began.


The modern fair dealing doctrine reflects a general move away from an author-centric view focused on the exclusive right of authors and copyright owners to control how their works are used in the marketplace to interpret copyright law as a balance between copyright rights and user rights. Fair dealing is not an exception and is one tool employed to achieve the proper balance between protection and access in the Act.


When assessing fairness, the Courts below approached the analysis from an institutional perspective only, leaving out the perspective of the students who use the materials. Both perspectives should be considered. In the educational context, instructors are facilitating the education of each of their individual students who have fair dealing rights. However, courts are not required to completely ignore the institutional nature of a university’s copying practices and adopt the fiction that copies are only made for individual isolated users. When an institution is defending its copying practices, its aggregate copying is necessarily relevant, for example, to the character of the dealing and the effect of the dealing on the work.


Contrary to the Federal Court of Appeal’s view, in the educational context, it is not only the institutional perspective that matters. When teaching staff at a university make copies for their student’s education, they are not hiding behind the shield of the user’s allowable purpose to engage in a separate purpose that makes the dealing unfair.


The Trial Judge’s criticism of York’s Guidelines because different portions of a single work could be distributed to different students, such that an author’s entire work could be distributed in the aggregate, was contrary to the Court’s previous decisions. Those decisions concluded in similar circumstances that since fair dealing is a ‘user’s right, the ‘amount of the dealing’ factor should be assessed based on the individual user, not the amount of the dealing in the aggregate.


Fair Dealing for the Purpose of Criticism or Review

In Canadian Broadcasting Corporation v. Conservative Party of Canada 2021 FC 425, the court said that the purpose of the exception was met if the source is identified or identifiable to a reasonably informed watcher. However, it is an important requirement.


A party may criticize not only the literary style but also the doctrine or philosophy as expounded in the work. Criticism, satire and review are intellectual challenges to particular thoughts, words and actions.


The two-step process and the application of the six non-exhaustive factors apply to this exception. The purpose of engaging in a legitimate political purpose so long as the other factors are considered can result in a finding of fair use.


Site-Blocking Orders

The Federal Court of Appeal found no error in the Judge’s conclusion that the Federal Court has the power to grant a site-blocking order and his analysis of the applicable legal test. Teksavvy Solutions Inc. v. Bell Media Inc. 2021 FCA 100.


Concerning the power of the Federal Court, the Court of Appeal said section 4 of the Federal Courts Act provides that the Federal Court is a court of equity, and section 44 provides that the Federal Court may issue an injunction “in all cases in which it appears to the court to be just or convenient to do so.” As stated by the Supreme Court of Canada in the Equustek decision, the powers of courts with equitable jurisdiction to grant injunctions are, subject to any relevant statutory restrictions, unlimited.


In addition, subsection 34(1) of the Copyright Act intentionally provides broad discretionary powers to address copyright infringement, including granting injunctions. Nothing in sections 41.25 to 41.27 of the Copyright Act suggested an intention to deny copyright owners the benefit of a site-blocking order, and nothing in such an order conflicts with these provisions. The fact that Parliament has put in place a regime to notify an alleged copyright infringer that its activities have come to the attention of the copyright owner does not suggest this represents a limit on the remedies to which the copyright owner is entitled.


Section 36 of the Telecommunications Act contemplates net neutrality by ISPs and provides that exceptions thereto must be approved by the CRTC. However, the section does not displace the Federal Court’s equitable powers of injunction, including the power to impose a site-blocking order.


Finally, the Equustek decision was a binding authority concerning the availability of a site-blocking order, notwithstanding that decision involved a de-indexing order, which removed one tool for finding a website. While a site-blocking order denied access to a website and was broader, the issues were similar.


The Court agreed with the Trial Judge’s conclusion that freedom of expression did not require the facilitation of unlawful conduct.


The Court pointed out that where a mandatory interlocutory injunction is sought, the appropriate inquiry at the first stage of the RJR — MacDonald test was whether the applicants have shown a strong prima facie case. However, they concluded that the plaintiffs’ case exceeded the requirement to show a strong prima facie case or a strong likelihood of success.


The Court agreed it was appropriate for the Judge to look to the decision of the UK Court of Appeal and factors considered by it for inspiration when faced with a motion for an order unprecedented in Canada. There was no indication that the Judge, in referring to these factors, fettered his discretion or felt compelled to follow them.


The order in issue contained mechanisms that made it dynamic to deal with future infringements. The Court was not convinced there was any palpable and overriding error in making such an order.


Statutory Damages

Subsection 38.1(1)(a) refers to all infringements involved in the proceedings, for each work on a plain reading provides a remedy of statutory damages that is calculated by multiplying a dollar amount within the monetary range by the number of works, not the number of infringements. Case law establishing that each infringement stands as a cause of action does not compel a different interpretation. Unfortunately, if there are numerous copies of the same work, statutory damages are capped at $20,000. It is not clear why multiple infringing copies of a work should be valued in a different way than infringing copies of multiple works. Patterned Concrete Mississauga Inc. v. Bomaite Toronto Ltd. 2021 FC 314.


The determination of the amount of statutory damages that the Court considers just is not necessarily tied to a plaintiff’s actual damages or a defendant’s actual profits.


It is the works, not the copies, that must be in a single medium for subsection 38.1(3) to apply.


Stare decisis and the Copyright Board

The Board is not bound by its prior decisions, and stare decisis does not apply to administrative decision-making. However, if the Board departs from past practices or longstanding practices, it must explain why it is doing so because those affected by its decision are entitled to expect that like cases will be treated alike. Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65.


The Enforceability of theTariffs

In Canadian Copyright Licensing Agency v. York University 2021 SCC 32, the Court confirmed that the tariff in issue was not enforceable against York. Section 68.2(1) did not empower Access copyright to enforce royalty payments against a user who chooses not to be bound by a licence on the approved terms.


The issue was the statutory interpretation of section 68.2, which is an exercise in discerning legislative intent by looking at the grammatical and ordinary meaning of the text in the context of the statute’s scheme and objectives.


Regarding the legislative context, the combined effect of ss. 68.2(1) and 70.17 creates a dichotomy between users who choose to be licensed pursuant to the terms of a Board-approved tariff and those who choose not to acquire a licence but may be liable for damages for infringement.


A review of the text, legislative context, purpose and supporting jurisprudence all lead to the conclusion that s. 68.2(1) does not make tariffs approved by the Copyright Board under s. 70.15 mandatory against users who choose not to be licensed on the approved terms.


The Retransmission Regime

The Supreme Court of Canada summarized the working of the regime in the following way:


It bears underlining that, in the case of works carried in both local and distant signals, the copyright owner has no right to prohibit the simultaneous retransmission of the work; recourse is limited to receiving through a collective society the prescribed royalty, but only for the simultaneous retransmission of works carried in distant signals (ss. 76(1) and 76(3) of the Copyright Act). On the one hand, the copyright owner is granted a general right to retransmit the work. This retransmission right is part of the right, under s. (3)(1)(f), to communicate the work by telecommunication to the public. On the other hand, the owner’s general right to retransmit is restricted by a carve-out in s. 31(2) of the Copyright Act, which effectively grants to a specific class of retransmitters two retransmission rights. The first right lets these users simultaneously retransmit without a royalty payment, works carried in a local signal. The second right lets them simultaneously retransmit works carried in distant signals, but only subject to the payment of royalties under a form of compulsory licence regime (Copyright Act, s. 31(2)(a) and (d)). Both user rights are subject to s. 31(2), beyond the owner’s control.


Judicial Review and Unreasonableness

The burden is on the party challenging the decision to show it is unreasonable. Before a decision can be set aside on this basis, the reviewing court must be satisfied there are sufficiently serious shortcomings in the decision such that it cannot be said to exhibit the requisite degree of justification, intelligibility and transparency. Any alleged flaws or shortcomings must be more than merely superficial or peripheral to the merits of the decision. It would be improper for a reviewing court to overturn an administrative decision simply because its reasoning exhibits a minor misstep. Instead, the court must be satisfied that any shortcomings or flaws relied on by the party challenging the decision are sufficiently central or significant to render the decision unreasonable. Canada (Minister of Citizenship and Immigration) v. Vavilov, 2019 SCC 65.


If you have questions, please contact me at mckeown@gsnh.com.


John McKeown

Goldman Sloan Nash & Haber LLP

480 University Avenue, Suite 1600

Toronto, Ontario M5G 1V2

Direct Line: (416) 597-3371

Fax: (416) 597-3370

These comments are of a general nature and not intended to provide legal advice as individual situations will differ and should be discussed with a lawyer.


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