On July 12, 2012, the Supreme Court of Canada issued its reasons in five copyright cases: Alberta (Education) v. Canadian Copyright Licensing Agency (Access Copyright), Re:Sound v. Motion Picture Theatre Associations of Canada, Entertainment Software Association v. Society of Composers, Authors and Music Publishers of Canada, Rogers Communications Inc. v. Society of Composers, Authors and Music Publishers of Canada, and Society of Composers, Authors and Music Publishers of Canada v. Bell Canada.

The results, while quite predictable, are very disappointing for someone who values individual rights, freedom and capitalism.

Howard Knopf in his post, A Proud and Progressive Pentalogy Day in Canadian Copyright Law has provided a brief outline of what the five cases stand for. It’s a good summary of what the cases stand for, but I squarely disagree with Mr. Knopf on his conclusions. My issues with his position start with the title, namely the use of the word “progressive”. I trust that the use of it is intentional and is in reference to the progressive movement. You may or may not agree with Glenn Beck, but the important question to ask when using the word progressive, even outside the political context is, “what are we progressing to?”. In my opinion, we are progressing away from a system where interests of the individual trump interests of the society and towards a system where interests of the “society”, expressed by whoever has the power to claim to be in position to represent such interests, trump interests of each particular individual making up that “society”. This never ends well.

Leaving the technicalities for a future post, I have three big problems with the 5 decisions.

My biggest problem is with paragraphs 9 and 10 of the Bell case, where the Court unanimously held that:

[9] Théberge reflected a move away from an earlier, author-centric view which focused on the exclusive right of authors and copyright owners to control how their works were used in the marketplace: see e.g. Bishop v. Stevens, [1990] 2 S.C.R. 467, at pp. 478-79. Under this former framework, any benefit the public might derive from the copyright system was only “a fortunate by-product of private entitlement”: Carys J. Craig, “Locke, Labour and Limiting the Author’s Right: A Warning against a Lockean Approach to Copyright Law” (2002), 28 Queen’s L.J. 1, at pp. 14-15.

[10] Théberge focused attention instead on the importance copyright plays in promoting the public interest, and emphasized that the dissemination of artistic works is central to developing a robustly cultured and intellectual public domain. As noted by Professor David Vaver, both protection and access must be sensitively balanced in order to achieve this goal: Intellectual Property Law: Copyright, Patents, Trade-marks (2nd ed. 2011), at p. 60.

This is exactly the problem with the current trend. I strongly believe that interests of the public should be completely irrelevant to copyright laws and copyright policy. Whether copyright laws provide any benefits as a “fortunate by-product” or they actually hurt the public does not really matter. What matters is whether those who create something that had not existed before have a chance to offer it to the public on THEIR terms, rather than being forced in a situation where they should either not disclose it to the public or expect the public to dictate such terms.

Notice the difference between a situation when the market forces a manufacturer to lower prices not to be squeezed out by the competition (as in copyright owners voluntarily adopting new models depending on granting access to their works for free) and a situation when the government adopts laws that say that those who really want or need to use the manufacturer’s product are entitled to steal from the manufacturer, but no more than 20% of the manufacturer’s total output (as in the government telling copyright owners they cannot sell their works because the public should have the “user right” to use them for free).

No matter what the Supreme Court of Canada says, copyright is not about access. It’s not about dissemination. It’s not about the royalties. The only thing that copyright is about is control. Take away control and you have slavery, because then the author is in no position to decide on which conditions to offer the results of his work to others. Whether it’s the public, the government or the collective society that decides it – it’s not the most important person in the equation, the author and the copyright owner.

My second big problem is that all five cases regarded copyright in the context of tariffs. Based on the false premise that copyright is about royalties, the Court seems to have used the following logic: “We have all these tariffs. If we decide that this action involves the use of this right recognized by the Copyright Act, then it would mean that it would fall under this or that tariff. Would that be a fair result?”

I understand that the cases WERE about tariffs, and that tariffs are an integral part of the copyright regime in Canada, but tariffs are merely an extension of exclusive rights that authors are supposed to voluntarily delegate to collective societies. Just because a collective society adopted a tariff royally approved by the Copyright Board does not create or destroy exclusive rights.

In Supreme Court’s reasons, however, the underlying assumption seems to be that the only purpose of authors’ existence is to provide an opportunity for the collective societies to apply tariffs.

This goes back to the priority of the interests of an individual over the collective.

Finally, Supreme Court further expanded fair dealing. Not only did it endorse the horrific idea of “user rights” previously found in CCH, it went far and beyond by removing even those scarce limitations of what the public could do to exclusive rights of copyright owners if the public feels like it.

In my opinion, most categories of fair dealing should be reduced to presumptions, which a copyright owner can rebut by declaring that the copyright owner does not grant the right to use his works for such purposes that the Copyright Act presumptively considers “fair”.

For example, why do we assume that a library should have the right to carry every single book it feels would benefit the community? Why cannot there be a situation when a copyright owner chooses to disallow libraries to carry the copyright owner’s books? This would happen in dismally small number of cases, so fair dealing would play the role in facilitating the dealings that are supposedly fair. But just because most copyright owners would be OK with such use does not mean that ALL of them would be. Individual rights are not about averages, they are about individuals.

Very seldom a use is truly fair if the copyright owner openly opposes it.

Same goes for the education. Why do we assume that the purpose of educating the next generation of students justifies robbing the current generation of authors and copyright owners of their right to decide if they want to allow teachers to distribute copies of their works to students without paying for it?

In summary, this is a very sad day for Canada. Not because greedy collective societies and big corporations will be able to grab less cash from the “working people” and the “less fortunate among us”. Not because a certain provision of the Copyright Act was interpreted to mean one thing, and not the other.

It is a sad day because it confirms the shift in the paradigm – from protecting individual rights against being infringed by other individuals or the mob, we are “progressively” drifting to laws that are subjecting rights of each individual to the mythical interests of the “whole”.

I have not only studied history, I’ve lived the socialist nightmare. Those of you who think that government-sponsored mass murders can never happen in Canada, think again.

No, just because the Supreme Court of Canada recognized that the fair dealing exception for the purpose of private study also covers non-private study will not be the cause of the government rounding up millions of Canadians and shooting them in the head. But that’s what progressivism is all about. Slowly changing the paradigm. Slowly robbing individuals of their rights… until one day they realize that ALL of their rights are now subject to whether they benefit the rest of the “collective”.

Those cheering today for the victory of the “users” are cheering for their own destruction as holders of individual rights, whatever these rights may be.

If there is a method to this madness, I surely don’t see it.

Copyright Modernization Act adds subsections 15(1.1), 15(2.1), 15(2.2), and 15(4) to the Copyright Act. These subsections are essentially an updated version of what used to be ss. 15(1), 15(2) and 15(3) of the Copyright Act.

The problem is that the Copyright Modernization Act does not repeal these former versions, and so, it appears, the Copyright Act will simultaneously have both the old and the new version.

This makes me wonder how many people who were so passionately debating over the amendments, have actually read the bill.

I see no reason other than sloppy drafting for the new Copyright Act to have both the old s. 15(1), which defined the scope of rights of performers in respect of their performances and the new s. 15(1.1), which does the same thing in a different way.

For example, old s. 15(1) mimics Article 7 of the Rome Convention and contains three subparagraphs 15(1)(b)(i), 15(1)(b)(ii) and 15(1)(b)(iii) defining the rights of a performer with respect to reproduction of his performance that is fixed: (i) to reproduce the fixation made without the performer’s authorization; (ii) to reproduce fixation made with authorization for purposes that were outside of the initial authorization; and (iii) to reproduce the fixation that was done without authorization but excused under various exceptions allowed by the Copyright Act for purposes that were outside the scope of such exceptions. The new s. 15(1.1) simply states that performers have a right to reproduce the fixation, period. Question, will an authorization by the performer to fix the performance for the purpose of putting a video on YouTube deprive the performer of the right to reproduce the performance for the same purpose?

In other words, will limitations of the old s. 15(1) still apply, even if s. 15(1.1) offers broader protection?

Section 15(1.1)(d) uses the following wording: “A performer’s copyright in the performer’s performance consists of the sole right … to make a sound recording of it available to the public by telecommunication in a way that allows a member of the public to have access to the sound recording from a place and at a time individually chosen by that member of the public and to communicate the sound recording to the public by telecommunication in that way”. Section s. 15(1.1)(a)(i) gives the performer, whose performance is not fixed, to communicate the performance to the public by telecommunication. Furthermore, s. 2.4(1.1) of the Copyright Act clearly states that “For the purposes of this Act, communication of a work or other subject-matter to the public by telecommunication includes making it available to the public by telecommunication in a way that allows a member of the public to have access to it from a place and at a time individually chosen by that member of the public.”

Now, quiz time:

1. Does the performer whose performance is not fixed have the right to communicate it to the public by telecommunication both in the old-fashioned way and in a way that amounts to the making available right?

2. Does the performer whose performance is fixed only have the making available right with respect to his performance due to the wording in s. 15(1.1)(d) or does he also have the traditional right to communicate the fixed performance to the public by telecommunication?

3. If the answer to #2 is that it’s only the disguised making available right, then what was the purpose of blending telecommunication to the public with the making available right if they are treated separately in the end?

My guess is as good as yours.

Section 15(1.1)(e) contains another masterpiece of legal drafting. It states that if the performance is fixed in a sound recording that is in the form of a tangible object, then the performer has the right to sell or otherwise transfer ownership of the tangible object, as long as that ownership has never previously been transferred in or outside Canada with the authorization of the owner of the copyright in the performer’s performance. If you haven’t already, please read my general comments about merging ownership in tangible objects and ownership of copyright in a work. How do you fix a performance in a sound recording that is not in the form of a tangible object? Would Bryan Adams, according to the new rules, own all iPhones that were used to record his performance at Rogers Arena in Vancouver on June 16, 2012?

It gets better from here.

Section 15(2) was the section that defined the national boundaries of protection for performers. Essentially it gave protection to performances if the performer or the performance had a connection to Canada or a Rome Convention country. The new Copyright Act keeps s. 15(2) intact and adds ss. 15(2.1) and 15(2.2). Section 15(2.1) gives protection to performances if the performer or the performance has a connection to Canada. Section 15(2.2) gives protection to performances if the performer or the performance has a connection to a WIPO Performances and Phonograms Treaty (WPPT). No word in the newly added sections about Rome Convention countries.

If the new sections were meant to displace the old s. 15(2), then it would mean that performances originating from performers who are citizens or permanent residents of a Rome Convention country, but not a WPPT country, will not be protected in Canada. If the new sections were meant to add to the old s. 15(2), then why would the new s. 15(2.1) duplicate the provisions of s. 15(2) in respect of connection to Canada?

Finally, the newly added s. 15(4) essentially duplicates provision of the old s. 15(3) and defines the first publication of a sound recording as it occurs in a WPPT country, whereas s. 15(3) used to define the first publication of a sound recording as it occurs in a Rome Convention country.

BOTTOM LINE: Awful, awful drafting. The intentions may have been good, but the resulting s. 15 is now more confusing than it used to be. A real shame for a massive amendment that the Copyright Modernization Act was supposed to achieve.

Copyright Modernization Act repeals s. 13(2) of the Copyright Act.

This was a section vesting the first copyright in a photograph or a portrait in the person who ordered and paid the photographer or the artist to take the photograph or create the portrait. In other words, when you paid a photographer to take a picture of you, unless you had agreed otherwise, it was you who owned copyright in the picture, not the photographer.

Now this provision is repealed, and it will be the photographer who will own copyright in the photograph or portrait he creates, even if the photographer is paid to do so.

This gives photographers essentially the same rights as web designers, copywriters, software developers, and everyone else who creates content for others. Just because they are getting paid to do something does not mean that the person who commissions the work will automatically own copyright in the works they create.

If ownership of copyright is important, the parties must sign an agreement that would unambiguously transfer copyright from the photographer to the person who ordered the photographs.

The repeal is also backed by adding a new s. 32.2(1)(f), which allows for non-commercial use of the photographs and portraits by the person who ordered and paid for such photographs and portraits. I will discuss this new provision as we get there.

BOTTOM LINE: Good. Even though it may add to the transaction cost when hiring a photographer, it is fair for the Copyright Act to recognize that if the photograph falls under the definition of an “original artistic work”, the photographer should be the first owner of it. If owning copyright in the photograph is important for the person who commissions the photograph, it should not be a problem to sign a short form assignment of copyright.

PS. If you are a photographer or someone who uses services of a photographer, you need to have a professionally drafted agreement that will Protect Your Ideas and Cover Your Assets™. From the legal standpoint, it does not matter who will end up owning copyright in the photograph. What matters is that both the photographer and the person paying the photographer for the photograph know exactly who will be the copyright owner in it.

I have been drafting copyright licenses and assignments for over 15 years. Let me know if I can be of assistance to you.

Most people think of intellectual property only as something that should be protected from others.

It is clear that when you invent something great, or write a thrilling new book, or shoot an awesome new movie, that you would want to protect your work from being used against your wish.

Most people and companies, however, are not this fortunate, and do not really create enough to want to hire a lawyer to protect what they’ve created.

This is one of the reasons why many businesses don’t think that they need to consult an IP lawyer. Their thinking goes like this: “Well, we don’t really create anything, and even if we do, it’s not enough to justify spending thousands and thousands of dollars to try to protect it.”

They may be right, but this approach misses a very serious point. IP is not only what you have to protect against others, it’s also something that others can use against you.

If you are a dentist, you may be interested in registering a trademark for your business, but really there is unlikely to be much more beyond that in terms of using IP as a tool of competitive advantage. But if you have a popular website that promotes your practice, you want to make sure that you own every little bit of content on that website.

What you don’t want to happen one day when your business finally makes it, is to find out that someone wants a piece of your pie, simply because you’ve been using their IP for several years to promote your business.

This is the difference between using IP as a sword (to obtain a tool of competitive advantage) and using IP as a shield (to make sure that nobody can lay a claim on your business).

Few businesses will need to use IP as a sword, but most of them are using IP created by somebody else.

If you don’t take care of IP as a shield, you will be sorry if your business becomes successful.

Copyright Modernization Act repeals s. 10 of the Copyright Act.

This was the section that provided special treatment to photographs and their authors.

It used to be the rule that the owner of the initial negative, plate or photograph at the time they were made was deemed the author of the photograph, which included the possibility that a corporation could be recognized as the author of the photograph.

With repeal of this section, there will be no special rules as to who will be recognized as the author of a photograph, so the usual rules will apply. This means that it is the person whose creative effort resulted in the creation of the work that will be recognized as the photograph’s author, regardless of the ownership in the photograph itself.

It will be curious to see how this repeal will work in conjunction with the newly added s. 3(1)(j) of the Copyright Act, which sets forth that copyright, among other things, includes the right to transfer ownership in the tangible object, if copyright is in the form such object.

Here’s a hypothetical situation that happens all the time. What if I ask someone to take a picture of me with my ipad. The person then carefully chooses the angle to ensure that the light is not interfering with the composition of the photograph, tells me to say ‘cheese’ and takes the photograph. The person who took the photo has just become an author. Moreover, the photo is a work that is in the form of a file that exists on my ipad, and is, in fact, a constituent part of my ipad. Can the person now sell my ipad based on s. 3(1)(j)?

This, of course, is me attacking s. 3(1)(j) again. As for the issue of authorship in photographs, this move is in compliance with the world practice and makes perfect sense. As long as the photograph is an “original artistic work”, it is protected by copyright and there is no reason to grant authorship in that photograph to somebody other than the person who made the creative effort.

BOTTOM LINE: Good. There was no reason to treat photographers differently than any other authors. As long as all criteria of copyrightability are met (and, granted, not all photographs will meet that criteria, however lenient), the person whose creative effort results in the creation of the work should reap the benefits of being recognized the author of the work.