Did the Supreme Court supplant the market for Access Copyright licenses?

Just over two weeks ago, the Supreme Court released its opinion in the Alberta (Education) v. Canadian Copyright Licensing Agency, 2012 SCC 37 (Access Copyright) fair dealing case. In that proceeding, the Copyright Board examined whether copying of short extracts of works for classroom teaching purposes was a fair dealing.* The Board and the Federal Court of Appeal found it was not. The Supreme Court allowed the appeal and remitted the matter to the Board to reconsider its decision in accordance with the Court’s construction of the fair dealing factors.

The decision has been widely reported. In many instances, the Court’s holding and its implications have been misunderstood. For example, some commentators have inaccurately reported that the Supreme Court ruled that copying of short extracts for students in primary and secondary educational settings is a fair dealing, that such copying did not negatively affect the market for works including textbooks, and that no royalties have to be paid to publishers and authors through Access Copyright for such copying.**

In the Bell v. SOCAN case which was released on the same day as the Access Copyright decision, the Supreme Court made an express finding that confirmed the Board’s ruling that “previews satisfy the requirements of fair dealing and that the online service providers do not infringe copyright.” By contrast, in the Access Copyright case the Court allowed the appeal and remitted “the matter to the Board for reconsideration based on [its] reasons.” The Court made no ruling that in the context of the tariff in issue, or any other tariff, that copying short extracts or other portions of textbooks for students is a fair dealing.

The parties before the Board had already agreed that, as part of their study methodology, the copying of short extracts by teachers for students without a request for the copies was for an allowable fair dealing purpose such as private study. Accordingly, the single issue before the Court was whether the Board had made a reviewable error in concluding the copying in question was unfair.

The Court ruled that the Board had misapplied the fairness factors. It instructed the Board to reconsider its decision taking into account the following considerations in assessing the fairness factors the Court had identified in CCH Canadian Ltd. v. Law Society of Upper Canada, [2004] 1 S.C.R. 339: 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.

  • In assessing the purpose, the Board can take into account that the copying facilitates private study. The Board can also examine whether the teachers or their employer educational institutions also have a separate, distinct purpose that tends to make the dealing unfair. Since the purpose fairness factor applies whenever a dealing is for an allowable purpose, the Board will need to determine whether the particular copying in the context in issue tends to be fair or unfair. As the Court note in the CCH case, “some dealings, even if for an allowable purpose, may be more or less fair than others”.
  • In assessing the amount of the dealing, the Board will need to examine the percentage of the work copied in relation to the whole work e.g. how much of a work was copied.
  • In assessing the character of the dealing, the Board will need to examine the fairness or quantification of the total or aggregate number of copies made; in this case, copying of in excess of 16 million pages.
  • In assessing the alternatives to the dealing, the Board may consider whether there is a non-copyright equivalent of the pages copied which could have been used, and whether the copying of the extracts was not reasonably necessary to achieve the purpose for which the copies were made.
  • In examining the “effect of the dealing on the work”, the Board will need to focus on any link between the copying of the extracts in issue and whether the copying adversely affects or competes with the original works.

I noted in a previous post that the Court Supreme Court made some significant changes to the interpretation of the fair dealing defense in the Access Copyright and SOCAN v Bell cases. However, the main focus of the 5-4 majority of the Court in the Access Copyright case was to clarify how to apply the fairness factors. The Court did not decide that the copying in issue was fair. It also expressed no opinions on how to weigh the fairness factors, either individually or in the aggregate, leaving those matters to the Board.

Some commentators have suggested that, in light of the decision, higher education institutions can copy from Access Copyright’s repetoire and pay nothing to authors and publishers for these uses. For example, Sam Trosow, an associate professor at Western Ontario, was recently quoted in an article as follows:

Trosow specializes in copyright law and said he advised against the Access Copyright deal earlier this year, partially because of the then-pending Supreme Court decision.

Justices handed down their ruling Thursday, saying content used for classroom lectures and discussion shouldn’t be subject to royalties.

That means, Trosow said, Western students shouldn’t be paying a dime.

For the reasons outlined above, the decision of the Supreme Court simply does not support such a conclusion. It is significant that the Supreme Court did not disturb the balance of the Board’s decision which had held that K-12 educational institutions did have to pay royalties for the remaining 230 million pages which triggered remuneration. Contrary to Professor Trusow’s conclusion, nothing in the reasons of the Court dictates that the extensive reprographic and digital copying that is licensed by Access Copyright, including under its new AUCC and ACCC Model Licences or Post Secondary Tariff, would  be fair dealings for which remuneration does not have to be paid.

Operating without licenses increases the likelihood of dealing unfairly with works and increases the risk of challenges — not an outcome that institutions or rightholders want to realize.



*Neil Finkelstein of my firm McCarthy Tétrault, was co-counsel in the appeal with Claude Brunet of Norton Rose Canada. Dan Glover and I were counsel for the interveners the Canadian Publishers’ Council, the Association of Canadian Publishers and the Canadian Educational Resources Council.

**See, for example:
Oslers: Supreme Court Reaches Decisions in Copyright Cases “Balancing all the factors, the Supreme Court concluded that the making of copies of short extracts constituted fair dealing. The Supreme Court’s decision broadens the scope of fair dealing, particularly in the context of non-profit education. Although K-to-12 schools will have to pay royalties for their reproduction of published works, their payments will not include payments for making copies of short extracts for required reading by students.” See, also, http://ow.ly/cCehN.
Dimock Stratton: Teachers’ photocopying of excerpts for classroom use qualifies as fair dealing, SCC rules “In Alberta (Education) v. Canadian Copyright Licensing Agency (Access Copyright), 2012 SCC 37, the majority of the Supreme Court held that copying excerpts of books by teachers for use in classrooms was fair dealing and excluded from a tariff sought by Access Copyright. In a decision written by Justice Abella, the majority held that the fairness analysis must be done from the perspective of students – the “users” of the works. The teachers were merely facilitating the student studies.”
Deeth Williams Wall: Canadian Supreme Court Delivers Several Leading Copyright Decisions “By a 5-4 majority, the Supreme Court reversed these decisions, reaffirming the test set out in CCH Canadian Ltd. v Law Society of Upper Canada, 2004 SCC 13, [2004] 1 SCR 339 (CCH case) (see the E-TIPS® mini-article on the CCH case here), and held that these copies were made under the “research or private study” fair dealing exception.”
Canadian Intellectual Property Blog: Supreme Court releases rulings for string of Copyright Law Cases “The Alberta v. Access Copyright case drew large public interest as it had implications to drastically change the current licensing business model between copyright collectives and educational institutions. In this case a teacher photocopied copyrighted material for a student for “research or private study”. The Copyright Board of Canada ruled that although the purpose was for private study, the actions did not amount to fair dealing with respect to s.29 of the Copyright Act for failing to be “fair” according to the legal test which analyzes six separate factors. The Majority of the Supreme Court came to the alternative outcome ruling copying of copyrighted work for the classroom constitutes fair dealing and no royalty should attach. Consequently, Access Copyright (the copyright collective in this case) stands to lose millions of dollars from royalties it would have collected from schools across the nation.”
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