Law Society of Upper Canada:

13th Annual Intellectual Property Law

– The Year in Review

Update on Copyrights 2009

Barry B. Sookman
January 15 2009
bsookman@mccarthy.ca

3715166
 Canadian Decisions

2
 Apple Canada Inc. v. Canadian Private
Copying Collective. 2008 FCA 9 (FCA)

Copying Music onto Devices not Part of

Private Copying Regime
• Apple. Dell, Microsoft, Sandisk, and Sony
sought judicial review of the Copyright
Board’s dismissal of their motions to
prevent the tariff proposed by CPCC on
digital audio recorders (DARs) from
being considered.
• The Court held the decision in Canadian
Private Copying Collective v. Canadian
Storage Media Alliance [2005] 2 F.C.R.
654 was binding and that the Copyright
Board does not have jurisdiction to
certify a tariff on DARs or on the
memory permanently embedded therein.

• Implications of decision?

3
 Canadian Wireless Telecommunications Association v.
Society of Composers, Authors and Music Publishers of
Canada 2008 FCA 6
• Whether a transmission of a ringtone to a cell phone as
part of a purchase and sale transaction is a (1)
“communication” that is (2) “to the public”.
(1) Are the transmissions of downloads of files
communications?
• The FCA held that the meaning of the word
“communication” is the same as the word “transmission”. It
held that a “communication” should be understood to
include transmissions of content delivered only for later
use.

• “The word “communication” connotes the passing

of information from one person to another. A musical
ringtone is information in the form of a digital audio file
that is capable of being communicated. The normal mode
of communicating a digital audio file is to transmit it. The wireless transmission of a musical
ringtone to a cellphone is a communication, whether the owner of the cellphone accesses it
immediately in order to hear the music, or at some later time. The fact that the technology used
for the transmission does not permit the cellphone owner to listen to the music during the
transmission does not mean that there is no communication. In my view, in the context of a
wireless transmission, it is the receipt of the transmission that completes the communication.”
• Communications are not limited to broadcasts and similar ephemeral transmissions that can be
perceived when transmitted.

4
 Canadian Wireless Telecommunications Association v.
Society of Composers, Authors and Music Publishers of
Canada 2008 FCA 6
(2) Are the transmissions of copies as part of a sale transaction
“to the public”
• “it seems to me that in 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.”
• “In my view, the conclusion of the Copyright Board that the transmissions in issue in
this case are within the scope of paragraph 3(1)(f) of the Copyright Act is consistent
with the language of that provision 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.”
• Is this decision consistent with the Cablevision case?
• Implications for Internet transmissions of music and Tariff 22?
• Why was leave to the Supreme Court denied?

5
 SOCAN-Tariff 22B-G, Decision of the
Copyright Board dated October 25, 2008

Real and Substantial Connection Test

• The Copyright Board applied the real and substantial
connection test in determining the royalties payable
in respect of the communication of music to the
public from various web sites.
• The Board held that all traffic to a Canadian radio or
TV site involves a communication to the public in
Canada. However, the Board held that certain
Canadian sites could remove from their rate base
95% of visits from outside of Canada, suggesting
that for non-radio or TV sites only 5% of visits from
foreign sites have a real and substantial connection
to Canada.
• The Board also permitted non-Canadian sites to
remove all non-Canadian visits, thus suggesting that
100% of all Canadian visits to foreign websites would
have a real and substantial connection to Canada and
be communications covered by the Act.
• Is the decision correct?

6
 SOCAN-Tariff 22B-G, Decision of the
Copyright Board dated October 25, 2008

Secondary Liability for Infringement

• The Board declined to set royalties for uses of music on social networking
and UGC sites.
• The Board suggested that the operators of these sites may be jointly and
severally liable with users for the communications to the public of
musical works from such sites.
• “Second, given the absence of any reliable evidence on which to base
our decision, any tariff we would have set would have been de minimis,
so as to avoid as much as possible the deleterious effects of seeking a
plethora of minimum payments for a myriad of very modest uses. The
effects could be all the more important if, because of joint and several
liability in the communication of music, thousands of individuals who are
active on the social networking or video sharing sites were deemed
individually responsible for minimal payments. We refuse to certify a
tariff that could potentially have such a broad scope without the proper
evidence.”
• What will the Court of Appeal do in the judicial review?

7
 Ghanotakis c. Expertises Didactiques Lyons Inc.
[2007] QCCA 1866
Originality
The respondents designed a series of educational board
games for children and hired the appellant to provide
marketing services for their products. The games contained
content for different levels of difficulty, corresponding to
different recommended ages of the users.
As part of his work, the appellant split up the games into
several “modules”, one for each difficulty level, so that they
could be purchased separately. The appellant claimed
copyright in the repackaged games.
The Court of Appeal affirmed the trial decision that the
mechanical acts of breaking up games to sell them in
separate parts for marketing purposes did not create an
“original” adaptation that was subject to copyright.
“The Chief Justice of Canada, on the basis of a former Court
of the Exchequer, writes:
For a compilation under the law, there is a need for more
than a simple mechanical operation. He needed to borrow a
phrase often used in case law, there is a spark of creativity.
"

8
 Médias Transcontinental s.e.n.c. c.
Soumissoinnez.com Inc. [2008] QCCS 1772
Compilations on Website are Protected by Copyright
“…it is reasonable to consider that a website is both a work as a whole
and the consolidation of a multitude separate works. In addition, a
website, like any compilation composed of ideas and data from the
public domain, may be the protection of the” Copyright Act.
“The compilation of tender and other information
on the website of the SÉAO is made through the
exercise of skill and discretion of the group
research Constructo. In the opinion of the Court,
this compilation is a "work" under the [Copyright
Act], regardless of ownership of such tenders.”
Online Webwrap Terms Enforced
“By accessing the website SÉAO… it is…deemed
to have accepted the conditions of access…and…is
not allowed sell, publish or reproduce extracts
important pages of the site.”

9
 Médias Transcontinental s.e.n.c. c.
Soumissoinnez.com Inc. [2008] QCCS 1772

Test for Granting Permanent Information

In R. v. James Lorimer and Co. Ltd., J. Mahoney of the Court of Appeals wrote:
"The Act [Act copyright] is clear. Infringement does not require that the
infringing work compete in the marketplace with that infringed; it requires only
that the infringer do something that the copyright owner alone has the right to
do. It follows that, where infringement of copyright has been established, the
owner of the copyright is prima facie entitled to an injunction restraining
further infringement. [...] The onus is on the infringer to establish grounds
upon which the Court may properly exercise its discretion against granting
such relief. Those grounds must lie in the conduct of the copyright owner, not
in the conduct or motives of the infringer. The fact that the copyright owner
has suffered no damages as a result of the infringement is not a basis for
refusing an injunction. "
“In this case, it was for the defendant to establish why the Court should
exercise its discretion to refuse the application for injunction, but it did not.”
Is this test correct?
Note: All translations into English performed using Google.

10
 Canwest Mediaworks Publications Inc. v.
Horizon Publications Ltd.2008 BCSC 1609

Fair Dealing Does Not Include Parody

The defendants distributed and printed a
parody version of the Vancouver Sun and
were sued for copyright infringement by
Canwest, which owns and operates the Sun.
The court held that neither parody nor the
Charter (freedom of expression) are
defenses to infringement under the Act
following the decision in Compagnie
Générale des Etablissements Michelin –
Michelin & Cie v. National Automobile
Aerospace, Transportation and Générale
Workers Union of Canada (CAW – Canada)
(1996) 71 C.P.R. (3d) 348

11
 Hong Everest Corp. v. Hqart Corp. [2008] O.J.
No. 2456
Granting of Interlocutory Injunctions
Hong Everest sought an order restraining defendant Hqart
(the principal employee of which used to work for Hong)
from offering for sale or marketing products using Hong
Everest’s designs, pricelists or catalogues.
The motion was denied for failure to satisfy the irreparable
harm and balance of convenience prongs of the
requirements for obtaining an injunction laid down in R.J.R.
MacDonald Inc. v. Canada (Attorney General) [1994] 1
S.C.R. 311
First, the plaintiff’s substantial loss of market share to the
defendants did not constitute irreparable harm that could
be compensated by way of damages or permanent
injunction at trial.
Second, the inconvenience suffered by the defendants
should an injunction be granted would be at least as great
as suffered by the plaintiffs should the injunction be
refused
Was the motion rightly decided?

12
 Don Hammond Photography Ltd. v. The
Consignment Studio Inc. [2008] ABPC 9
Ownership of Photographs
The defendants commissioned the plaintiff to
produce several photographs for
advertisements, but never paid the plaintiff’s
account. Plaintiff sued for copyright
infringement.
The defendants claimed they were the first
owners of the copyright pursuant to s.13(2) of
the Copyright Act, which stipulates that in the
case of an engraving, photograph or portrait,
the person by whom the plate or other original
was ordered shall be the first owner.
However, s.13(2) also requires that
consideration be paid for the work and, having
found no such payment of consideration, Justice
Ingram ruled that the plaintiff retained
copyright ownership in the negatives. As such,
the defendants had infringed upon the plaintiff’s
copyright in the works.

13
 Don Hammond Photography Ltd. v. The
Consignment Studio Inc. [2008] ABPC 9

Statutory Damages
The defendants had agree to pay the plaintiff $1,431 for the commission
of five photographs, an amount which they did not pay.
The plaintiff elected for statutory damages. S.38.1(1) of the Copyright
Act provides that statutory damages should be assessed at no less than
$500 and no more than $20,000 per work infringed.
However, s.38.1(3) provides that if an award pursuant to s.38.1(1) is
grossly out of proportion to the infringement, the court may award an
amount lower than $500 per work.
Justice Ingram ruled that the minimum statutory damage award of
$2,500 in this case would be grossly out of proportion to the damage
incurred and reduced the award to $500 for all five works pursuant to
s.38.1(3), plus costs to the unrepresented plaintiff.

14
 Louis Vuitton Malletier S.A. v. 486353 B.C. Ltd. et
al. 2008 BCSC 799

Statutory Damages and Punative Damages

Defendants were found to infringe both trade-marks
and copyrights of Louis Vuitton.
For damages under copyright, the Court awarded the
maximum statutory damages of $20,000 per work.
Factors leading to this high damage award included that
the defendants acted wilfully and knowingly in violation
of the plaintiff’s rights, that neither the service of the
Anton Pillar order or the seizure of hundreds of articles
deterred the defendants from continuing infringing
conduct, that the defendants ignored the issuance of a
cease & desist letter and that the defendants attempted
to evade service, ignored production orders and failed
to appear at several court dates.
Based on the above, the Court also awarded punitive
and exemplary damages against the defendants. A sum
of $100,000 was awarded jointly and severally against
the defendant corporation and two employees, and a
sum of $200,000 was awarded against the principal of
the enterprise.
15
 Foreign Decisions

16
 Twentieth Century Fox Film Corp. v. Cablevision
Systems Corp., 536 F.3d. 121 (2nd. Cir. 2008)

“This case implicates… the right “to reproduce

the copyrighted work in copies,” and the right
“to perform the copyrighted work publicly.” 17
U.S.C. § 106(1), (4). As discussed above, the
district court found that Cablevision infringed
the first right by 1) buffering the data from its
programming stream and 2) copying content
onto the Arroyo Server hard disks to enable
playback of a program requested by an RS-
DVR customer. In addition, the district court
found that Cablevision would infringe the
public performance right by transmitting a
program to an RS-DVR customer in response
to that customer’s playback request.”

The Court reversed the district court.

17
 Twentieth Century Fox Film Corp. v. Cablevision
Systems Corp., 536 F.3d. 121 (2nd. Cir. 2008)

Does Transitory Copying of information in a Buffer Infringe the Reproduction Right?

“It is undisputed that Cablevision, not any customer or other entity, takes the content from one
stream of programming, after the split, and stores it, one small piece at a time, in the BMR
buffer and the primary
ingest buffer. As a result, the information is buffered
before any customer requests a recording, and would
be buffered even if no such request were made. The
question is whether, by buffering the data that make
up a given work, Cablevision “reproduce[s]” that work
“in copies,” 17 U.S.C. 10 § 106(1), and thereby
infringes the copyright holder’s reproduction right.”
“Copies,” as defined in the Copyright Act, “are material
objects...in which a work is fixed by any method...and
from which the work can be...reproduced.” Id. § 101. The
Act also provides that a work is “‘fixed’ in a tangible medium
of expression when its embodiment...is sufficiently
permanent or stable to permit it to be...reproduced...for
a period of more than transitory duration.”
“We believe that this language plainly imposes two distinct but related requirements: the work
must be embodied in a medium, i.e., placed in a medium such that it can be perceived,
reproduced, etc., from that medium (the “embodiment requirement”), and it must remain thus
embodied “for a period of more than transitory duration” (the “duration requirement”).

18
 Twentieth Century Fox Film Corp. v. Cablevision
Systems Corp., 536 F.3d. 121 (2nd. Cir. 2008)

The Embodiment Requirement

“Cablevision does not seriously dispute that copyrighted works are
“embodied” in the buffer. Data in the BMR buffer can be reformatted and
transmitted to the other components of the RS-DVR system. Data in the
primary ingest buffer can be copied onto the Arroyo hard disks if a user
has requested a recording of that data. Thus, a work’s “embodiment” in
either buffer “is sufficiently permanent or stable to permit it to be
perceived, reproduced,” (as in the case of the ingest buffer) “or otherwise
communicated” (as in the BMR buffer). 17 U.S.C. § 101. The result might
be different if only a single second of a much longer work was placed in
the buffer in isolation. In such a situation, it might be reasonable to
conclude that only a minuscule portion of a work, rather than “a work”
was embodied in the buffer. Here, however, where every second of an
entire work is placed, one second at a time, in the buffer, we conclude that
the work is embodied in the buffer.”
• Is this consistent with the Warner and Football Association cases?

19
 Twentieth Century Fox Film Corp. v. Cablevision
Systems Corp., 536 F.3d. 121 (2nd. Cir. 2008)

The Transitory Duration Requirement

“Does any such embodiment last “for a period of more than
transitory duration”? No bit of data remains in any buffer for
more than a fleeting 1.2 seconds. And unlike the data in
cases like MAI Systems, which remained embodied in the
computer’s RAM memory until the user turned the computer
off, each bit of data here is rapidly and automatically
overwritten as soon as it is processed. While our inquiry is
necessarily fact-specific, and other factors not present here
may alter the duration analysis significantly, these facts
strongly suggest that the works in this case are embodied in
the buffer for only a “transitory” period, thus failing the
duration requirement.”

20
 Twentieth Century Fox Film Corp. v. Cablevision
Systems Corp., 536 F.3d. 121 (2nd. Cir. 2008)
Who Is Liable for Creating Playback Copies?
“When there is a dispute as to the author of an allegedly infringing instance of
reproduction, Netcom and its progeny direct our attention to the volitional
conduct that causes the copy to be made. There are only two instances of
volitional conduct in this case: Cablevision’s conduct in designing, housing, and
maintaining a system that exists only to produce a copy, and a customer’s
conduct in ordering that system to produce a copy of a specific program. In the
case of a VCR, it seems clear–and we know of no case holding otherwise–that
the operator of the VCR, the person who actually presses the button to make the
recording, supplies the necessary element of volition, not the person who
manufactures, maintains, or, if distinct from the operator, owns the machine.
We do not believe that an RS-DVR customer is sufficiently distinguishable from a
VCR user to impose liability as a direct infringer on a different party for copies
that are made automatically upon that customer’s command.”
“Here, by selling access to a system that automatically produces copies on
command, Cablevision more closely resembles a store proprietor who charges
customers to use a photocopier on his premises, and it seems incorrect to say,
without more, that such a proprietor “makes” any copies when his machines are
actually operated by his customers. See Netcom, 907 F. Supp. at 1369.”
(Emphasis added)
21
 Twentieth Century Fox Film Corp. v. Cablevision
Systems Corp., 536 F.3d. 121 (2nd. Cir. 2008)
Transmission of RS-DVR Playback –Is it “to the public”?
“In sum, none of the arguments advanced by plaintiffs or the district court
alters our conclusion that, under the transmit clause, we must examine the
potential audience of a given transmission by an alleged infringer to
determine whether that transmission is “to the public.” And because the RS-
DVR system, as designed, only makes transmissions to one subscriber using
a copy made by that subscriber, we believe that the universe of people
capable of receiving an RS-DVR transmission is the single subscriber whose
self-made copy is used to create that transmission.”
“…it seems quite consistent with the Act to treat a transmission made using
Copy A as distinct from one made using Copy B, just as we would treat a
transmission made by Cablevision as distinct from an otherwise identical
transmission made by Comcast. Both factors–the identity of the transmitter
and the source material of the transmission–limit the potential audience of a
transmission in this case and are therefore germane in determining whether
that transmission is made ‘to the public.’”
• Will cert be granted?

22
 Capitol Records v. Thomas, 579 F.Supp.2d 1210
(D. Minn. Nov. 2008)
Does making available a file over a P2P network
constitute a “distribution” under the U.S. Copyright Act?

“The Copyright Act provides that “the owner of copyright

under this title has the exclusive rights to do and to authorize
any of the following: . . . (3) to distribute copies or
phonorecords of the copyrighted work to the public by sale or
other transfer of ownership, or by rental, lease, or lending.”
17 U.S.C. § 106(3). The Act does not define the term
‘distribute.’”
“The Court’s examination of the use of the term “distribution”
in other provisions of the Copyright Act, as well as the
evolution of liability for offers to sell in the analogous Patent
Act, lead to the conclusion that the plain meaning of the term
“distribution” does not including making available and,
instead, requires actual dissemination.”
• Is the decision correct?

23
 Jacobsen v. Katzer 535 F.3d 1373 (Fed. Cir.
2008)

Whether terms of use in the Artistic Open Source

license are mere covenants for which a violation
is breach of contract or conditions for which a
violation is copyright infringement.
Jacobsen had developed model railroad design
software. He made it available for public download
free of charge, under the "Artistic License“.
The licence permits users to copy, modify or distribute
the licensed content provided that they restate the
attribution information found in the software, repeat
all copyright notices and document any modifications
made to the software from its original form.
Jacobsen alleged that Katzer downloaded his code,
included it in his competing software program and
failed to comply with the terms of the Artistic License.
He sued Katzer for copyright infringement and sought
a preliminary injunction.

24
 Jacobsen v. Katzer 535 F.3d 1373 (Fed. Cir.
2008)
The Benefits of Open Source Licensing
“Traditionally, copyright owners sold their copyrighted material in
exchange for money. The lack of money changing hands in open source
licensing should not be presumed to mean that there is no economic
consideration, however. There are substantial benefits, including economic
benefits, to the creation and distribution of copyrighted works under public
licenses that range far beyond traditional license royalties. For example,
program creators may generate market share for their programs by
providing certain components free of charge. Similarly, a programmer or
company may increase its national or international reputation by
incubating open source projects. Improvement to a product can come
rapidly and free of charge from an expert not even known to the copyright
holder. The Eleventh Circuit has recognized the economic motives inherent
in public licenses, even where profit is not immediate. See Planetary
Motion, Inc. v. Techsplosion, Inc., 261 F.3d 1188, 1200 (11th Cir. 2001)
(Program creator Aderived value from the distribution [under a public
license] because he was able to improve his Software based on
suggestions sent by end-users.”

25
 Jacobsen v. Katzer 535 F.3d 1373 (Fed. Cir.
2008)

Open Source Licensing is Popular

“Open source licensing has become a widely used method of creative
collaboration that serves to advance the arts and sciences in a manner and
at a pace that few could have imagined just a few decades ago. For
example, the Massachusetts Institute of Technology (AMIT@) uses a
Creative Commons public license for an OpenCourseWare project that
licenses all 1800 MIT courses. Other public licenses support the GNU/Linux
operating system, the Perl programming language, the Apache web server
programs, the Firefox web browser, and a collaborative web-based
encyclopedia called Wikipedia. Creative Commons notes that, by some
estimates, there are close to 100,000,000 works licensed under various
Creative Commons licenses. The Wikimedia Foundation, another of the amici
curiae, estimates that the Wikipedia website has more than 75,000 active
contributors working on some 9,000,000 articles in more than 250
languages.”

26
 Jacobsen v. Katzer 535 F.3d 1373 (Fed. Cir.
2008)
The Artistic License grants users the right to copy, modify, and
distribute the software provided that [the user] insert a prominent
notice in each changed file stating how and when [the user] changed
that file, and provided that [the user] do at least ONE of the following:
a) place [the user’s] modifications in the Public Domain or otherwise
make them Freely Available, such as by posting said modifications
to Usenet or an equivalent medium, or placing the modifications on
a major archive site such as ftp.uu.net, or by allowing the
Copyright Holder to include [the user=s] modifications in the
Standard Version of the Package.
b) use the modified Package only within [the user=s] corporation or
organization.
c) rename any non-standard executables so the names do not conflict
with the standard executables, which must also be provided, and
provide a separate manual page for each nonstandard executable
that clearly documents how it differs from the Standard Version, or
d) make other distribution arrangements with the Copyright Holder.

27
 Jacobsen v. Katzer 535 F.3d 1373 (Fed. Cir.
2008)
“The Artistic License states on its face that the document creates
conditions: “The intent of this document is to state the conditions under
which a Package may be copied.” The Artistic License also uses the
traditional language of conditions by noting that the rights to copy, modify,
and distribute are granted “provided that” the conditions are met.”
“The clear language of the Artistic License creates conditions to protect the
economic rights at issue in the granting of a public license. These
conditions govern the rights to modify and distribute the computer
programs and files included in the downloadable software package. The
attribution and modification transparency requirements directly serve to
drive traffic to the open source incubation page and to inform downstream
users of the project, which is a significant economic goal of the copyright
holder that the law will enforce. Through this controlled spread of
information, the copyright holder gains creative collaborators to the open
source project; by requiring that changes made by downstream users be
visible to the copyright holder and others, the copyright holder learns
about the uses for his software and gains others’ knowledge that can be
used to advance future software releases.”

28
 Jacobsen v. Katzer 535 F.3d 1373 (Fed. Cir.
2008)

“Copyright holders who engage in open source licensing have the

right to control the modification and distribution of copyrighted
material. As the Second Circuit explained in Gilliam v. ABC, 538 F.2d
14, 21 (2d Cir. 1976), the “unauthorized editing of the underlying work,
if proven, would constitute an infringement of the copyright in that work
similar to any other use of a work that exceeded the license granted by
the proprietor of the copyright.” Copyright licenses are designed to
support the right to exclude; money damages alone do not support or
enforce that right. The choice to exact consideration in the form of
compliance with the open source requirements of disclosure and
explanation of changes, rather than as a dollar-denominated fee, is
entitled to no less legal recognition. Indeed, because a calculation of
damages is inherently speculative, these types of license restrictions
might well be rendered meaningless absent the ability to enforce through
injunctive relief.”

29
 Jacobsen v. Katzer 535 F.3d 1373 (Fed. Cir.
2008)
Test for Preliminary Injunction
“In determining whether to issue a preliminary injunction, the Ninth Circuit
requires demonstration of (1) a combination of probability of success on the
merits and the possibility of irreparable harm; or (2) serious questions going to
the merits where the balance of hardships tips sharply in the moving party”s
favor. Perfect 10, Inc. v. Amazon.com, Inc., 487 F.3d 701, 713-14 (9th Cir. 2007)
… In cases involving copyright claims, where a copyright holder has shown
likelihood of success on the merits of a copyright infringement claim, the Ninth
Circuit has held that irreparable harm is presumed… But see MGM Studios, Inc. v.
Grokster, Ltd., 518 F. Supp. 2d 1197, 1212 (C.D. Cal. 2007) (noting that “the
longstanding rule that irreparable harm can be a presumed after a showing of
likelihood of success for purposes of a copyright preliminary injunction motion
may itself have to be reevaluated in light of eBay [Inc. v. MercExchange, L.L.C.,
547 U.S. 388 (2006)]”). Thus, for a preliminary injunction to issue, Jacobsen
must either show (1) a likelihood of success on the merits of his copyright
infringement claim from which irreparable harm is presumed; or (2) a fair chance
of success on the merits and a clear disparity in the relative hardships that tips
sharply in his favor.”

30
 Nine Network Australia Pty Ltd v. IceTV Pty Ltd.
[2007] FCA 1172
The main issue in the appeal is whether the primary Judge correctly rejected the
claim by the appellant (‘Nine’) that the respondents (‘Ice’) had infringed Nine’s
copyright in its television program schedules, the ‘Weekly Schedules’ in producing
its subscription-based ‘electronic program guide’ (‘EPG’) for television called
‘IceGuide’.
• “The time and title information incorporated into the Weekly Schedules reflected a
great deal of skill and labour... Ice, to the extent it reproduced time and title
information from the Weekly Schedules, appropriated the skill and labour used by
Nine to create the Weekly Schedules. Contrary to her Honour’s conclusion, the skill
and labour in selecting and arranging programming should not be regarded as
separate and discrete from the extremely modest skill and labour involved in
setting down on paper the programs already selected and presenting them in the
form of the Weekly Schedules. The skill and labour expended by Nine were part of a
single process leading to the creation of the copyright work as the written record of
Nine’s programming decisions and the associated program information.”
• What will the High Court of Australia do on appeal?

31
 Football Association Premier League Ltd v. QC
Leisure Ltd. [2008] EWHC 1411 (Ch)
• These actions concern the use of foreign decoder cards in the
UK to access foreign transmissions of live Premier League
football matches.
• The claimants complain that the dealing in and use of such
cards in the UK involves an infringement of their rights under
s.298 of the UK CDPA and of the copyrights in various artistic
and musical works, films and sound recordings embodied in
the Premier League match coverage.
• Two of the actions are brought against suppliers of equipment
and satellite decoder cards to pubs and bars, which enable
the reception of non-Sky satellite channels (including NOVA or
ART channels) that carry live Premier League matches.
• The third action (the Madden action) is against licensees or
operators of four pubs that have shown live Premier League
matches broadcast on ART channels. The claims contend the
Madden defendants have infringed their copyrights by
• creating buffer copies of the works in the internal
operation of the satellite decoder
• by displaying the works on screen
• by communicating the works to the public in pubs
• by authorising pubs (the Madden defendants) and users
to whom they have supplied decoder cards.

32
 Football Association Premier League Ltd v.
QC Leisure Ltd. [2008] EWHC 1411 (Ch)
Creating copies of the works in the internal operation of the satellite decoder
“It is clear that fragments of the various film works, the musical work and the sound recording
are stored sequentially in the decoder. The question is whether such fragments individually
amount to a substantial part of the copyright work and, if not, whether they should be
considered collectively.”
“This dispute gives rise to two questions which are, at least to some extent, interlinked: first,
does a fragment consisting of four frames of a video stream amount to a substantial part?
Second, in considering whether a substantial part has been copied, does one consider whether
the material in existence at any one point in time is a substantial part, or does one consider
the whole volume of material which is progressively created and then destroyed?”
“As to the first question, I have reached the conclusion that four frames do not constitute a
substantial part of the film works. They occupy a fraction of a second and there is no
suggestion that they have any inherent value other than as part of the whole.”
“This brings me to the next question which is whether it is appropriate to consider the
fragments on a cumulative or rolling basis... In my judgment it is simply not possible to fit
such a situation into the language of the statute. It is a restricted act to make a transient copy
of a substantial part of the work. In other words, the substantial part must be embodied in the
transient copy, not a series of different transient copies which are stored one after the other in
the decoder box.” (Emphasis added)

33
 Football Association Premier League Ltd v.
QC Leisure Ltd. [2008] EWHC 1411 (Ch)
Infringement by displaying works on a screen
“I have to say that I entertain some doubt as to whether those
who framed the CDPA ever contemplated that displaying an
image on a television screen amounts to copying... However...
despite my reservations, I have reached the conclusion that it is
indeed this broad... I am confirmed in this view by the decision
of Aldous J in Bookmakers Afternoon Greyhound Services v Wilf
Gilbert (Staffordshire) Ltd [1994] FSR 723... which, like the
CDPA, restricted "reproducing the work in any material form".
Aldous J held that the defendants infringed the copyright
subsisting in race cards by showing them on television monitors
in their shops. This, he found, involved reproducing them in a
material form. In my judgment the position under the CDPA is
no different...
As to whether the whole or a substantial part of the film works
are reproduced, the claimants’ position is no stronger than for
the decoder.”
“But the position in relation to the artistic works (the various
graphics, devices and logos) is different. I accept that these are
reproduced in full within one frame of the broadcast signal in the
decoder and as seen on the television.”

34
 Football Association Premier League Ltd v. QC
Leisure Ltd. [2008] EWHC 1411 (Ch)
Infringement by communicating matches to the public
in pubs.
“The claimants... submit the publicans are communicating
the copyright works to the public in two ways:
rebroadcasting from the pub's satellite dish to the public bar
area and by displaying the visual works on the pub's
television screens and the playing of the audio works
through the television's speakers.”
“Have the publicans communicated the copyright works to
members of the public not present at the origin of those
communications? They have plainly displayed them and
played them to members of the public...The audience is far
wider than the publicans and their families. But it is my
provisional view they have not communicated them to the
public within the meaning of Article 3. There has been no
retransmission by the publicans whether by wire or
otherwise. They have simply received the signal, decoded it
and displayed it on a television. The only acts of
communication to the public have been those of the FAPL,
NOVA and ART. In short, there has been no act of
communication to the public within the Directive separate
from the satellite broadcast itself.”
• Decision shows difference between perform in public and
communicate to the public rights.
35
 Football Association Premier League Ltd v. QC
Leisure Ltd. [2008] EWHC 1411 (Ch)
Infringement by authorising pubs (the Madden defendants) and users to
whom they have supplied decoder cards.
“This is an important aspect of the copyright claim. It is contended that QC and AV
have infringed FAPL's copyrights by authorising the infringing acts of their
customers, including those of the Madden defendants. Authorisation is a primary
infringement under s.16(2) of the CDPA.
“In my judgment decoder cards are quite different to the twin-tape recorders the
subject of the Amstrad decision. Those recorders might or might not be used to
perform the allegedly infringing activities and there was nothing inherent in the sale
which suggested that Amstrad had the authority to allow those activities to be
carried out. By contrast, a decoder card is the key which allows the viewer to watch
encrypted programming. It has one purpose only, which is to permit him access to
what he would otherwise be denied. In this sense it is an authorisation in physical
form. Absent a statement or some other indication to the contrary, the supply of
decoder cards to customers therefore constitutes authorisation to use the decoder
cards for the purpose for which they were supplied. In the case of publicans, they
were supplied to allow customers to watch the television programming in the pubs. I
therefore conclude that QC and AV have authorised any infringing acts of the
Madden defendants and other members of the public to whom they have
supplied the NOVA and ART cards.” (Emphasis Added.)

36
 Lucasfilm Ltd. v. Ainsworth. [2008]
EWHC 1878 (Ch.)

• This was an action for infringement of copyright related to

replicas of helmets and armour of characters in Star Wars
film.
• The defendant had created the prototypes and moulds for
these items. He then used the original moulds and sold
replicas over the Internet. He was sued by Lucas in the U.S.
Who obtained a copyright infringement judgement.
Case in the U.K. involved:
• Could the U.S. Judgement be enforced in the U.K.
• Was the defendant liable for copyright infringement under
U.K. Law
• Was the U.S. Claim for copyright infringement justicible in
the U.K. Courts
• Who owns the copyright in designs commissioned for
manufacturing purposes in the absence of a written
agreement

37
 Lucasfilm Ltd. v. Ainsworth. [2008]
EWHC 1878 (Ch.)
Could the U.S. Judgement be enforced in the U.K.
“A proper application of Cape as it stands therefore means that neither Mr Ainsworth nor his
company was sufficiently present in the United States at the date of the commencement (or
service) of the US proceedings (or at any time) to allow the US judgment to be enforced
here. But it remains to be considered whether it is now necessary or appropriate to extend
Cape to apply to cases such as the present, of which there must be many in the light of the
explosion of internet trading in the years since Cape… The first reason is that Cape is clear
authority for requiring a relevant degree of literal and physical presence, and it is binding on
me… Second, modern methods of internet trading do not seem to me inevitably to require a
change in the law in this area anyway. The Cape principles were established at a time when
trade between countries could take place by telephone, letter and telex. It was not sufficient
to establish the enforceability of a foreign judgment that there be trading into that foreign
country by those means, no matter how extensive the trading. Internet trading is not
materially different for these purposes. It just makes the establishing of contracts easier –
advertising is easier, placing an order is easier and quicker, and payment is more easily (and
usually more quickly) achieved. It does not make the seller more present in the buyer's
country. If Mr Ainsworth were present in the US by means of his internet trading, why is he
not present in every country into which he sells goods by means of an internet deal? That
would be a very far-reaching conclusion, and one which would not be justified by any
underlying principle, or at least not by any principle underpinning Cape.”
• What would be the result in Canada under Pro-Swing?

38
 Lucasfilm Ltd. v. Ainsworth. [2008]
EWHC 1878 (Ch.)

Was the defendant liable for copyright infringement under U.K. law
Neither the helmets nor the armour were scultpures or works of artistic craftmanship.
“First, the original Stormtrooper helmet... It was a mixture of costume and prop. But
its primary function is utilitarian. While it was intended to express something, that
was for utilitarian purposes... it was not conceived, or created, with the intention that
it should do so other than as part of character portrayal in the film.... It is not that it
lacks artistic merit; it lacks artistic purpose.”
“I do not consider that they are works of artistic craftsmanship... Their purpose was
not to appeal to the aesthetic at all. It was to give a particular impression in a film...It
was no part of their purpose that it should in any way appeal as a piece of art; or that
it should be admired for any aspect of its appearance as such; or that it should do
anything more than what was necessary to give the correct impression of the
character inside (and perhaps an environment) when used in a film (with all the
assistance that the techniques of filming can to do to enhance an impression...Unlike
a work of artistic craftsmanship, they were not intended to sustain close scrutiny.”

39
 Lucasfilm Ltd. v. Ainsworth. [2008]
EWHC 1878 (Ch.)

Was the U.S. Claim for copyright infringement justicible in the U.K.
Courts
“an English court can, and in an appropriate case should, determine at least
questions of infringement of foreign copyright cases. Those cases will include
cases where subsistence is not in issue. I would not, however, hold that
questions of subsistence can never be decided here. In land cases incidental
questions of title can apparently now be considered. I can see no reason why
the same should not apply to copyright.”
“at least so far as copyright is concerned, the whole of a foreign copyright
claim, no matter how fundamental the points, might be capable of being
litigated here.”
• What would the result be in Canada? See Rim v. Atari.

40
 Lucasfilm Ltd. v. Ainsworth. [2008]
EWHC 1878 (Ch.)
Who owns the copyright in commissioned designs
“Where the outside draftsman was merely commissioned to produce engineering
or production drawings from rough sketches supplied by the manufacturer the
case for saying that the manufacturer is the owner in equity is very strong
indeed. The principle in operation in all these cases is that both parties intended
that the manufacturer or commissioner should have the rights necessary for him
to protect the property he has purchased and the enterprise for which the
drawings were intended to be used. Where that is the case, the law will consider
the commissioner to be entitled to the copyright in equity, and the author to be
under an obligation to assign it.”
“Mr Ainsworth was working to render into 3D form the copyright designs of
others... He must have known that the client would expect full exploitation rights
in the future for the purposes of its dramatic offering and cannot realistically
have expected to have retained any for himself. If the officious bystander had
asked the required question (suggesting that Lucas would have all the rights and
that Mr Ainsworth would not be entitled to exploit them without Lucas's licence)
then the required testy suppression would have been forthcoming. I think that
this is a classic case for saying that there is an implication that the commissioner
would have the copyright in the helmet (if any).”

41
 SABAM v. SA Scarlet (Tiscali). No. 07/15472/A
(Court of First Instance of Brussels),
Oct. 22, 2008

• ISP Scarlet ordered to block infringing

p2p transmissions of users through it
networks.
• Scarlet asked that the decision be
rescinded because blocking or filtering for
infringing p2p files was not possible.
• The court held that Scarlet had not
established that blocking or filtering of
infringing files was not possible. An
expert had identified 6 possible methods
of blocking files. Scarlett was given 6
months to implement a solution or pay
daily damages to SABEM.

42
 Copyright Reform

43
 What is Bill C-61?
Bill C-61 aimed to:

• Amend the Copyright Act in order to implement the World Intellectual

Property Organization Copyright Treaty (WCT) and Performances and
Phonograms Treaty (WPPT)

• Create exceptions for certain uses of copyright material for private

purposes

• Create exceptions for Internet Service Providers (ISPs)

• Permit certain uses for educational and research purposes of Internet

and other digital technologies, and

• Change for photographers.

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 Safe Harbors for ISPs
Bill C-61 would have introduced four safe
harbors for ISPs:
• A network services exception, intended to
provide protection to intermediaries who act
as conduits in relation to the Internet.
• A caching exception, which includes the act
of caching where necessary to make a
telecommunication more efficient.
• A hosting services exception, intended to
provide an exception for providers of hosting
services.
• An exception for information location tools
intended to provide the operators of search
engines with immunity against any remedy
other than injunctions.

45
 Consumer Exceptions

Bill C-61 would have established three new exceptions to copyright

infringement related to private, non-commercial uses:

1. Time shifting, which allows individuals to fix a

communication signal or reproduce a work that is
being broadcast in order to record a program for
the purpose of watching it later.
2. Format shifting, which would permit an individual
to reproduce a work onto another medium or
device.
3. A special format shifting exception only for music.

Bill C-61 would also have substantially

reduced the potential liability of
individuals who infringe copyright for
private, non-commercial purposes.

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 Education and Photography Provisions

• Bill C-61 would have allowed educational

institutions to make copies of copyrighted
material for distance education for students
• The provisions would also allow educational
institutions to copy or perform publicly
available material (PAM) found on the
Internet.

• Bill C-61 would have repealed

s.13(2) of the Copyright Act,
which made a person who
commissions a portrait,
photograph or engraving the
first owner of the copyright.

47
48