The Supreme Court rules on copyright in a pentology of cases

July 12th, 2012 by Barry Sookman Leave a reply »

Earlier today, the Supreme Court released reasons in the five copyright appeals heard back to back on December 6 and 7, 2011 in the following cases:[i]

In summary the Supreme Court allowed the appeals in ESA v. SOCAN (in a 5 to 4 split) and Access Copyright (also in a 5 to 4 split); dismissed the appeals in SOCAN v. Bell and Re:Sound; and allowed in part and dismissed in part the Rogers v. SOCAN appeal.

The decisions of the Court, which will take a while to digest, cover a lot of ground. Here is a summary of some of the key legal principles canvassed by the Court. Others have focused on summarizing the specific findings of the Court in each of the cases. Some of the summaries can be found here, here, here, and here.

Interpretation of the Act

The Court re-affirmed or re-emphasized a number of legal principles to be used in construing the Act.

The Act reflects a balance in copyright between promoting the public interest in the encouragement and dissemination of works and obtaining a just reward for the creator.

This principle was first articulated in Théberge v. Galerie d’Art du Petit Champlain inc., [2002] 2 S.C.R. 336. The Court referred to this principle in ESA v. SOCAN where the Court went on to say that the “traditional balance between authors and users should be preserved in the digital environment”. It also re-iterated this principle in Rogers v. SOCAN[ii]. In SOCAN v. Bell the Court went on to note that “both protection and access must be sensitively balanced in order to achieve the goals of copyright”.

The Act should be construed in a technologically neutral manner.

This principle was applied by the Court in ESA v SOCAN to ensure that copies of video games purchased in a store or delivered by mail were not treated differently from those downloaded over the Internet or sent by e-mail. According to the Court:

The principle of technological neutrality is reflected in s. 3(1) of the Act, which describes a right to produce or reproduce a work “in any material form whatever”.  In our view, there is no practical difference between buying a durable copy of the work in a store, receiving a copy in the mail, or downloading an identical copy using the Internet.  The Internet is simply a technological taxi that delivers a durable copy of the same work to the end user…

The principle of technological neutrality requires that, absent evidence of Parliamentary intent to the contrary, we interpret the Copyright Act in a way that avoids imposing an additional layer of protections and fees based solely on the method of delivery of the work to the end user.  To do otherwise would effectively impose a gratuitous cost for the use of more efficient, Internet-based technologies.

The Act should be interpreted to extend to technologies that were not or could not have been contemplated at the time of its drafting. It exists to protect the rights of authors and others as technology evolves[iii].

This principle was expressed in the Rogers v. SOCAN case as follows:

In addition, this Court has long recognized in the context of the reproduction right that, where possible, the Act should be interpreted to extend to technologies that were not or could not have been contemplated at the time of its drafting: Apple Computer Inc. v. Mackintosh Computers Ltd., [1987] 1 F.C. 173 (T.D.), aff’d [1988] 1 F.C. 673 (C.A.), aff’d [1990] 2 S.C.R. 209.  That the Act was to apply to new technologies was recently reaffirmed in Robertson v. Thomson Corp., [2006] 2 S.C.R. 363, at para. 49, per LeBel and Fish JJ.:

Media neutrality is reflected in s. 3(1) of the Copyright Act which describes a right to produce or reproduce a work “in any material form whatever”.  Media neutrality means that the Copyright Act should continue to apply in different media, including more technologically advanced ones. … [I]t exists to protect the rights of authors and others as technology evolves.

The rights in the introductory paragraph of Section 3(1) of the Act provide the basic structure of copyright. The enumerated rights listed in the subsequent subparagraphs are simply illustrative.

This principle was articulated by the Court in ESA v. SOCAN as follows:

Nor is the communication right in s. 3(1)(f) a sui generis right in addition to the general rights described in s. 3(1).  The introductory paragraph defines what constitutes “copyright”.  It states that copyright “means” the sole right to produce or reproduce a work in any material form, to perform a work in public, or to publish an unpublished work.  This definition of “copyright” is exhaustive, as the term “means” confines its scope.  The paragraph concludes by stating that copyright “includes” several other rights, set out in subsections (a) through (i).  As a result, the rights in the introductory paragraph provide the basic structure of copyright.  The enumerated rights listed in the subsequent subparagraphs are simply illustrative.

U.S. copyright cases must be scrutinized very carefully before being applied in Canada because of the different wording and policy considerations in both acts.[iv]

Interpretation of the communication to the public right

The ESA v. SOCAN and Rogers v. SOCAN appeals raised the question as to how Section 3(1)(f) is to be interpreted. This provision gives copyright owners the right “ in the case of any literary, dramatic, musical or artistic work, to communicate the work to the public by telecommunication

In ESA v. SOCAN, the Court ruled that a download of a video game was not a “communication” within the meaning of Section 3(1)(f).

In Rogers v. SOCAN, the Court ruled that on-demand transmissions of music streams as part of online music services are communications that are “to the public”.

Here are some highlights from the Court related to the interpretation of the communication to the public right:

The right to “communicate” is connected to the right to perform a work and not the right to reproduce permanent copies of the work.

The Court ruled that the distinction between reproduction and performance in s. 3(1) has been maintained all the way through to the current version of the Act.[v]

The 1988 amendments to the Copyright Act which replaced the words “radio communication” with “telecommunication” should be understood as merely expanding the means of communicating a work — that is, from radio waves (“by radio communication”) to cable and other future technologies (“to the public by telecommunication”).

By “substituting the word “telecommunication” in 1988, Parliament did not intend to change the fundamental nature of the communication right, which had for over 50 years been concerned with performance-based activities. Instead, Parliament only changed the means of transmitting a communication. The word “communicate” itself was never altered.”[vi]

A music stream is a communication within the meaning of Section 3(1)(f). [vii]

The term “telecommunication” should be broadly construed so as to apply to communications that do not depend on the types of technology used to effect the communication.

This was expressed in Rogers v SOCAN as follows:

Although the words “in any material form whatever” qualify the right to “produce or reproduce the work” in s. 3(1), the same principle should guide the application of the neutral wording of the right to “communicate … to the public by telecommunication”.  The broad definition of “telecommunication” was adopted precisely to provide for a communication right “not dependent on the form of technology” (SOCAN v. CAIP, at para. 90).

An on-demand communication of a work to members of the public can be a communication that is to the public.

In assessing whether any particular transmissions or series of transmissions are “to the public” the broader context has to be considered. A communication is not restricted to a purely non-interactive context. A series of repeated transmissions of the same work to numerous different recipients” may constitute a communication “to the public” within the meaning of s. 3(1)(f) of the Act. Where such a series of point-to-point communications of the same work to an aggregation of individuals is found to exist, it can be a communication that is “to the public”. Such an interpretation of the right is consistent with the WCT, which recognizes that the making available right extends “to point-to-point transmissions at the user’s request”.

This issue was canvassed by the Court in the Rogers v. Bell decision as follows:

Focusing on each individual transmission loses sight of the true character of the communication activity in question and makes copyright protection dependant on technicalities of the alleged infringer’s chosen method of operation.  Such an approach does not allow for principled copyright protection.  Instead, it is necessary to consider the broader context to determine whether a given point-to-point transmission engages the exclusive right to communicate to the public.  This is the only way to ensure that form does not prevail over substance.

Sharlow J.A. addressed this issue in Canadian Wireless Telecommunications Assn. v. Society of Composers, Authors and Music Publishers of Canada, 2008 FCA 6, [2008] 3 F.C.R. 539, leave to appeal refused [2008] 2 S.C.R. vi (“CWTA”), holding that a person offering members of the public the opportunity to download ringtones for their mobile phones thereby communicates the musical works contained in the ringtones to the public.  She wrote that this approach

is consistent with the language of [s. 3(1)(f) of the Act] and its context.  It also accords with common sense.  If a wireless carrier were to transmit a particular ringtone simultaneously to all customers who have requested it, that transmission would be a communication to the public.  It would be illogical to reach a different result simply because the transmissions are done one by one, and thus at different times. [para. 43]…

These considerations are sufficient to dispose of the appellants’ argument that a point-to-point transmission is necessarily a private transaction outside of the scope of the exclusive right to communicate to the public.  To quote Sharlow J.A., at para. 35 of CWTA,

[I]n determining whether paragraph 3(1)(f) applies to the transmission of a musical work in the form of a digital audio file, it is not enough to ask whether there is a one-to-one communication, or a one-to-one communication requested by the recipient.  The answer to either of those questions would not necessarily be determinative because a series of transmissions of the same musical work to numerous different recipients may be a communication to the public if the recipients comprise the public, or a significant segment of the public.

CCH (SCC) determined that a “series of repeated … transmissions of the same work to numerous different recipients” may constitute a communication “to the public” within the meaning of s. 3(1)(f) of the Act (CCH (SCC), at para. 78).  Where such a series of point-to-point communications of the same work to an aggregation of individuals is found to exist, it matters little for the purposes of copyright protection whether the members of the public receive the communication in the same or in different places, at the same or at different times or at their own or the sender’s initiative.

The Act applies to push as well as to pull means of transmitting a work to the public.

The historic relationship between the right to communicate to the public and broadcasting-type, “push” technologies, and the 1988 amendment in particular, is evidence that the Act has evolved to ensure its continued relevance in an evolving technological environment. The historic relationship does not support reading into the Act restrictions which are not apparent from and are even inconsistent with the neutral language of the Act itself.

The applicability of the communication to the public right is not dependant on the arbitrary choice of business models.

Whether a business chooses to convey copyright protected content in a traditional, “broadcasting” type fashion, or opts for newer approaches based on consumer choice and convenience, the end result is the same. The copyrighted work has been made available to an aggregation of individuals of the general public.

Ultimately, in determining the extent of copyright, regard must be had for the fact that “[t]he Copyright Act is usually presented as a balance between promoting the public interest in the encouragement and dissemination of works of the arts and intellect and obtaining a just reward for the creator” (Théberge v. Galerie d’Art du Petit Champlain inc., 2002 SCC 34, [2002] 2 S.C.R. 336, at para. 30).  This balance is not appropriately struck where the existence of copyright protection depends merely on the business model that the alleged infringer chooses to adopt rather than the underlying communication activity.  Whether a business chooses to convey copyright protected content in a traditional, “broadcasting” type fashion, or opts for newer approaches based on consumer choice and convenience, the end result is the same.  The copyrighted work has been made available to an aggregation of individuals of the general public.

Interpretation of the fair dealing defence

Both the Access Copyright and the Bell v. SOCAN cases involved the construction of the fair dealing defence.

The Access Copyright case was a judicial review from a decision of the Copyright Board which examined whether copying of short extracts for classroom teaching purposes was a fair dealing. The Board and the Federal Court of Appeal had found it was not. The Supreme Court allowed the appeal and remitted the matter back to the Board to reconsider its decision in accordance with its construction of the fair dealing defence.

The Bell v. SOCAN case addressed whether previews of music made available by online music services were a fair dealing for the purposes of research. The Board and the Federal Court of Appeal held they were. The Court affirmed that holding.

Here are some highlights from the Court related to the interpretation of the fair dealing defence:

The test for fair dealing was articulated in CCH as involving two steps. The first is to determine whether the dealing is for the allowable purpose of “research or private study” under s. 29, “criticism or review” under s. 29.1, or “news reporting” under s. 29.2 of the Copyright Act.  The second step of CCH assesses whether the dealing is “fair”.

The onus is on the person invoking “fair dealing” to satisfy all aspects of the test.[viii]

Fair dealing is regarded as a user right. [ix] 

The term “private study” can include students in a classroom setting.

The word “private” in “private study” “should not be understood as requiring users to view copyrighted works in splendid isolation. Studying and learning are essentially personal endeavours, whether they are engaged in with others or in solitude.”

The term “research” must be given a large and liberal interpretation and can include users listening to previews to decide whether to purchase music.

“Research” is not limited “to creative purposes”. It can “include many activities that do not demand the establishment of new facts or conclusions. It can be piecemeal, informal, exploratory, or confirmatory. It can in fact be undertaken for no purpose except personal interest.” Consumers’ uses of previews for the purpose of conducting research to identify which music to purchase can be “research” under the fair dealing framework.

The relevant perspective when considering whether a dealing is for an allowable purpose is that of the user and not the copier. The copier’s purpose is relevant in the fairness analysis.

Traditionally, the fairness of a dealing has been assessed by looking at the predominant purpose of the person engaged in the acts covered by copyright, i.e. the acts of the copier. In CCH, the Court expanded the framework to permit a dealing to be allowable where the purpose of the copier and the users were identical. In both the Access Copyright and SOCAN v Bell cases the Court departed from prior precedents and held that “the relevant perspective when considering whether the dealing is for an allowable purpose under the first stage of CCH is that of the user” and not the copier.

However, the Court went on to say that the copier’s purpose is relevant at the fairness stage and that “copiers cannot camouflage their own distinct purpose by purporting to conflate it with the research or study purposes of the ultimate user”[x]  For example, “If, as in the “course pack” cases, the copier hides behind the shield of the user’s allowable purpose in order to engage in a separate purpose that tends to make the dealing unfair, that separate purpose will also be relevant to the fairness analysis.”[xi]

The Court re-iterated its opinion in CCH that to assist in determining whether a dealing is “fair”, the following list of fairness factors should be considered: the purpose, character, and amount of the dealing; the existence of any alternatives to the dealing; the nature of the work; and the effect of the dealing on the work.[xii]

In examining the purpose of the dealing at the second stage, the court must make an objective assessment of the “real purpose or motive” behind using the copyrighted work.[xiii]

In SOCAN v. Bell, the Court agreed with the Board and the Federal Court of Appeal “that the predominant perspective in this case is that of the ultimate users of the previews, and their purpose in using previews was to help them research and identify musical works for online purchase. While the service providers sell musical downloads, the purpose of providing previews is primarily to facilitate the research purposes of the consumers.”

In Access Copyright, the Court considered that photocopies made by a teacher and provided to primary and secondary school students are an essential element in the research and private study undertaken by those students. The “Instruction and research/private study are, in the school context, tautological.”

The “amount of the dealing” factor focuses on the proportion of the work copied in relation to the whole work; the “character of the dealing” factor examines the fairness of the copying in the aggregate.

The Court in both cases clarified how to apply the “amount of the dealing” and the “character of the dealing” factors. In considering the “amount of the dealing” factor, the focus is on the proportion of the work copied in relation to the whole work. The “amount” factor is not a quantitative assessment based on aggregate use, it is an examination of the proportion between the excerpted copy and the entire work, not the overall quantity of what is disseminated. The “amount of the dealing” factor should therefore be assessed by looking at how each dealing occurs on an individual level, not on the aggregate use. The fairness or quantification of the total or aggregate number of copies is considered under the “character of the dealing” factor.[xiv]

In examining the “effect of the dealing on the work”, the analysis focuses on the link between the copying that is sought to be characterized as being fair and whether the dealing adversely affects or competes with the original work.[xv]

Whether pre‑existing recordings incorporated into a soundtrack of a cinematographic work constitutes a sound recording 

In the Re:Sound case, the Supreme Court affirmed the decision of the Board and the Federal Court of Appeal that the term “soundtrack” includes pre‑existing sound recordings and that such recordings are excluded from the definition of “sound recording” when they accompany a cinematographic work.



[i] Dan Glover and I acted for ESA in the ESA v. SOCAN appeal and for the interveners the Canadian Publishers’ Council, the Association of Canadian Publishers and the Canadian Educational Resources Council in the Access Copyright appeal.

[ii] See also the Rogers v. SOCAN case where the Court declined to let particular business models determine whether a transmission was to the public or not.

[iii] Rogers v. SOCAN

[iv] Rogers v. SOCAN, SOCAN v. Bell

[v] ESA v. SOCAN

[vi] ESA v. SOCAN

[vii] Rogers v. SOCAN

[viii] Access Copyright; SOCAN v. Bell

[ix] Access Copyright; SOCAN v Bell

[x] Access Copyright

[xi] Access Copyright

[xii] Access Copyright; SOCAN v. Bell

[xiii] SOCAN v. Bell

[xiv] Access Copyright; SOCAN v. Bell

[xv] Access Copyright

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