Blocking orders available in Canada rules Court of Appeal in GoldTV case

blocking orders

In a landmark decision released by the Federal Court of Appeal in Teksavvy Solutions Inc. v. Bell Media Inc. 2021 FCA 100, the Court affirmed the blocking order made against the pirate streaming service GoldTV and confirmed that blocking orders are available in Canada to combat illicit online services that target the Canadian market with infringing copyright content. I previously summarized the decision of the motion court judge Patrick Gleeson whose decision was at issue in the appeal.

The decision of the Court of Appeal dealt with three broad issues: whether the Federal Court had the power to grant a blocking order; if so, the relevance of freedom of expression; and whether the order was just and equitable.

Whether the Federal Court had the power to grant a blocking order

The Court concluded that the Federal Court had the power to make blocking orders under Sections 4 and 44 of the Federal Courts Act.  Section 4 constitutes the court as a “court of law, equity and admiralty in and for Canada” while Section 44 gives the courts the power to make orders “in all cases in which it appears to the court to be just or convenient to do so.” This broad power was confimed in Google Inc. v. Equustek Solutions Inc., 2017 SCC 34, where the Supreme Court held that “[t]he powers of courts with equitable jurisdiction to grant injunctions are, subject to any relevant statutory restrictions, unlimited.” The jurisdiction is also conferred by subsection 34(1) of the Copyright Act which provides that the owner of the copyright is “entitled to all remedies by way of injunction, damages, accounts, delivery up and otherwise that are or may be conferred by law for the infringement of a right”.

Teksavvy argued that as blocking orders are not expressly mentioned in the Act, and because the Act contains other measures to combat piracy such as the notice and notice regime, blocking orders cannot be made. The Court rejected these arguments.

Teksavvy notes that copyright law in Canada is wholly statutory, and that the rights and remedies provided for in the Copyright Act are exhaustive: Keatley Surveying Ltd. v. Teranet Inc., 2019 SCC 43, 169 C.P.R. (4th) 1 at para. 40; Society of Composers, Authors and Music Publishers of Canada v. Canadian Assn. of Internet Providers, 2004 SCC 45, [2004] 2 S.C.R. 427, at para. 82 (SOCAN); Théberge v. Galerie d’Art du Petit Champlain inc., 2002 SCC 34, [2002] 2 S.C.R. 336, at para. 5 (Théberge); CCH Canadian Ltd. v. Law Society of Upper Canada, 2004 SCC 13, [2004] 1 S.C.R. 339, at para. 9 (CCH).

In my view, however, nothing in sections 41.25 to 41.27 of the Copyright Act suggests 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 that this represents a limit on the remedies to which the copyright owner is entitled. In fact, the Supreme Court of Canada in Rogers Communications Inc. v. Voltage Pictures, LLC, 2018 SCC 38, [2018] 2 S.C.R. 643, at para. 45 (Voltage) recognized the opposite, stating that “Parliament knew that the [notice and notice] regime was only a first step in deterring online copyright infringement, and that a copyright owner who wished to sue an alleged infringer would still be required to obtain a Norwich order to identify that person.” A Norwich order, like a site-blocking order, is a mandatory interlocutory injunction that is imposed on an ISP. It also is not explicitly provided for in the Copyright Act.

Subsection 34(1) of the Copyright Act intentionally provides broad discretionary powers to address copyright infringement, including injunction. It is important to bear in mind that there is no serious doubt that the GoldTV Services infringe the plaintiffs’ copyright, or that the interim and interlocutory injunctions against the infringers directly were not respected. Accordingly, it is difficult to doubt that the remedies contemplated in subsection 34(1) of the Copyright Act are worthy of consideration.

Moreover, there are examples in the jurisprudence of remedies for copyright infringement that are not specifically mentioned in the Copyright Act and that may be imposed on third parties not accused of infringement. Apart from the Norwich Order mentioned in Voltage, there is the Mareva injunction whereby the assets of a debtor that are in the hands of a third party may be frozen to prevent dissipation. Though not related to innocent parties, the Supreme Court of Canada has also recognized other remedies related to copyright infringement that are not specifically mentioned in the Copyright Act: punitive damages (Cinar Corporation v. Robinson, 2013 SCC 73, [2013] 3 S.C.R. 1168) and declaratory judgment (CCH Canadian Ltd. v. Law Society of Upper Canada, 2004 SCC 13, [2004] 1 S.C.R. 339).

In my view, the possible remedies contemplated in subsection 34(1) of the Copyright include a site-blocking order.

Teksavvy also argued that the Court could not make a bocking order because of s.36 of the Telecommunications Act. It contended that s,36 of the Telecommunications Act contemplates net neutrality by ISPs and provides that exceptions thereto must be approved by the CRTC. This net neutrality argument was also rejected by the Court.

In my view, the general wording of section 36 of the Telecommunications Act does not displace the Federal Court’s equitable powers of injunction, including the power to impose a site-blocking order. The wording of section 36 would have to be more explicit to have that effect, especially if it were to give rise to the awkward two-step process described in the previous paragraph. Section 36 prohibits a Canadian carrier, including an ISP, from “control[ling] the content or influenc[ing] the meaning or purpose of telecommunications carried by it for the public.” I agree with the plaintiffs’ argument that complying with a Court-ordered injunction does not amount to controlling or influencing. On the contrary, it is the ISP that is being controlled or influenced by the Order.

It is also notable that the majority of the Supreme Court in Equustek found that Google’s “content neutral character” was not an impediment to the de-indexing order granted in that case: Equustek at para. 49. Though Google was not subject to section 36 of the Telecommunications Act, neutrality was nevertheless considered and found not to be an obstacle.

Teksavvy also tried to distinguish the Equustek case suggesting it was only about trade secrets and trade marks and not copyrights and that blocking orders are more intrusive than the search engine de-indexing order that was in issue in the Equustek case, but the Court did not accept these arguments either.

Teksavvy argues several grounds on which the facts in the present case are distinguishable from those in Equustek. First, Teksavvy argues that Equustek involved trademarks and trade secrets rather than copyright. Unlike trademark and trade secrets, and as indicated above, legal rights in copyright exist only by statute. Where the common law may provide certain remedies regarding trademarks and trade secrets, Teksavvy argues, all remedies regarding copyright must be contemplated by statute.

In my view, Equustek should not be distinguished on the basis that it involved trademarks and trade secrets rather than copyright. As indicated above, subsection 34(1) the Copyright Act does provide for “all remedies by way of injunction” where copyright has been infringed. This provision gives a court of equity like the Federal Court broad powers to impose injunctions to remedy copyright infringement. Moreover, though the Supreme Court in Equustek mentioned trademarks and trade secrets as the legal rights in issue, it is clear that copyright infringement was also in issue in the action underlying that decision. The decision following trial in the underlying action, Equustek Solutions Inc. v. Jack, 2020 BCSC 793, 325 A.C.W.S. (3d) 260, identified breaches of the Copyright Act as being among the wrongful acts alleged.

A second ground that Teksavvy asserts to distinguish Equustek is that the site-blocking order at issue in the present appeal is more intrusive than the de-indexing order that was discussed in Equustek. I recognize that a site-blocking order denies access to a website, whereas a de-indexing order merely removes one tool for finding a website. However, I see no reason that Equustek should not be considered an authority for granting a mandatory injunction other than a de-indexing order against a third party not accused of wrongdoing. In my view, Equustek is good authority for the availability of a site-blocking order. The circumstances of each case must be considered to determine whether and what type of injunction may be appropriate. Though there are questions as to the effectiveness of a site-blocking order in the circumstances of this case, as well as whether less intrusive alternatives were available, those questions should be considered in determining whether such an order should be granted here, not to whether a court has the power to grant such an order at all.

Freedom of Expression

Teksavvy argued that blocking orders violate the right to freedom of speech under the Charter.  It claimed that such orders affected the freedom of expression of two groups: the ISPs who are required to block certain websites, and their customers who would otherwise have access to those websites.

The Court outright rejected any contention that ISPs could claim any expressive interests given they are merely neutral intermediaries.

I have difficulty accepting that ISPs like Teksavvy engage in any expressive activity when they provide their customers with access to certain websites. As Teksavvy itself has argued, it acts as a common carrier subject to an obligation of net neutrality. As such, it should not, and presumably does not, show any preference for one website over another based on its content. In this sense, its everyday activities in question are not expressive and therefore do not engage freedom of expression. That said, I accept that Teksavvy’s customers could have an expressive interest that is implicated by the Order.

Teksavvy also argued that the order infringed freedom of expression since it denied Teksavvy’s customers access to the GoldTV Services, and such infringement was not justified under section 1 of the Charter. The Court held it was not necessary to decide whether the Charter was engaged and, if so, whether freedom of expression was infringed. “In considering the issue of freedom of expression in the context of a particular equitable remedy, it was not necessary for the Judge to engage in a detailed Charter rights analysis separate and distinct from the balance of convenience analysis that is already to be considered. This is clear from the decision in Equustek in which the majority engaged in no such separate Charter rights analysis.”

Whether the Order was just and equitable

The Court reviewed the reasoning of the motions court judge and concluded that there was no error in determining that it was just and equitable for the court to have granted the injunction.

The Court saw no error in the findings of the motion court judge that a strong prima facie case of copyright infringement had been made out against the illegal IPTV streaming service. The motions court judge also had found that the copyright owners would suffer irreparable harm if the injunction was not granted to block the infringing content and the Court found no error in this holding either.

On the balance of convenience issue, Teksavvy argued the motion court judge fettered his discretion and erred in relying on factors gleaned from a series of decisions in the U.K. case: Cartier International AG v. British Sky Broadcasting Ltd., [2014] EWHC 3354 (Ch); Cartier International AG v. British Sky Broadcasting Ltd., [2016] EWCA Civ 658; Cartier International AG v. British Telecommunications plc, [2018] UKSC 28. The motions court judge listed these factors in his reasons:

Necessity – a consideration of the extent to which the relief is necessary to protect the plaintiff’s rights. The relief need not be indispensable but the court may consider whether alternative and less onerous measures are available;

Effectiveness – a consideration of whether the relief sought will make infringing activities more difficult to achieve and discourage Internet users from accessing the infringing service;

Dissuasiveness – a consideration of whether others not currently accessing the infringing service will be dissuaded from doing so;

Complexity and Cost – a consideration of the complexity and cost of implementing the relief sought;

Barriers to legitimate use or trade – a consideration of whether the relief will create barriers to legitimate use by unduly affecting the ability of users of ISP services to access information lawfully;

Fairness – a consideration of whether the relief strikes a fair balance between fundamental rights of the parties, the third parties and the general public;

Substitution – a consideration of the extent to which blocked websites may be replaced or substituted and whether a blocked website may be substituted for another infringing website; and

Safeguards – a consideration of whether the relief sought includes measures that safeguard against abuse.

The Court also rejected these arguments:

I see no indication that the Judge, in referring to these factors, fettered his discretion or felt compelled to follow them. The Judge indicated at paragraph 50 of his reasons that “it is appropriate to seek guidance from the UK jurisprudence,” but he recognized that the Cartier factors were grounded on foreign law. Moreover, he recognized correctly at paragraph 51 that “[t]he fundamental question to be asked where an injunction is sought is whether the granting of the injunction is just and equitable in all of the circumstances.”

The Judge also noted at paragraph 47 that “Teksavvy has not disputed or taken issue with the test to be met or the factors that have been identified based on the UK jurisprudence.” I have heard no suggestion as to any particular one or more of the Cartier factors that were inappropriate for the Canadian context for any reason. It is notable that Cartier was cited in Equustek. In my view, it was entirely appropriate for the Judge to look abroad for inspiration when faced with a motion for an order that was unprecedented in Canada.

I also conclude that it was open to the Judge to consider necessity under irreparable harm rather than balance of convenience. I see no palpable and overriding error in addressing possible alternative measures under irreparable harm rather than balance of convenience.

The Judge considered freedom of expression under the “fairness” factor from Cartier…Teksavvy argues that the Judge failed to give serious weight to freedom of expression. I disagree. A key part of Teksavvy’s position is that concerns for freedom of expression relate to the possibility of over-blocking. However, the Judge considered this and was satisfied with the measures to limit over-blocking contained in the Order. I see no error here. Moreover, as I indicated above, the depth of the Judge’s analysis of freedom of expression was comparable to that in Equustek.

In the result the Court “found no error in the Judge’s conclusion that the Federal Court has the power to grant a site-blocking order, and having likewise found no error in his analysis of the applicable legal test, I conclude that this Court should not interfere with the Judge’s decision.”

Concluding remarks

The decision of the Court of Appeal puts to rest arguments that blocking orders cannot be made to help fight illegal sites, servers, and services that make  available infringing copyright content to the Canadian market. The order made in the GoldTV case was a “dynamic” one as it enabled the plaintiffs to have the order updated to address circumvention activities by the defendant operators and so the decision confirms this form of order can be made as well. The decision would clearly also permit courts to grant “live” orders which take effect while a programme such as a soccer match is being broadcast and which have been repeatedly issued such as in the U.K., Ireland, and elsewhere in the EU. The       decision was also content agnostic and would clearly apply not only to TV programming and films, but also to music, books and other literary works, games, and to sports programming.

The decision also debunks arguments that have been made by those opposed to effective legal protection for copyright against what the government once called the “wealth destroyers”  and the many objections and inaccurate claims made against such blocking orders including that they somehow violate principles of net neutrality or the Charter right to freedom of expression. In these regards, the Court joined with courts in many other countries that have similarly rejected such arguments including courts in the U.K., European Union, Mexico, and India.

The decision by the Court, while welcome, does not obviate the need for an efficient and specific amendment to the Copyright Act to create a “no fault” mechanism for obtaining blocking orders such as what exists in the European Union, Singapore, and Australia. This is, in fact, now being studied by the Canadian Government in its current consultation on copyright reform for Online Intermediaries.

** McCarthy Tetrault lawyers Barry Sookman, Steven Mason, Dan Glover, and Kendra Levasseur represented the following intervenors in the appeal: International Publishers Association, International Association of Scientific, Technical and Medical Publishers, American Association of Publishers, The Publishers Association Limited, Canadian Publishers’ Council, Association of Canadian Publishers, The Football Association Premier League Limited, and Dazn Limited.

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