The Copyright Board's August 18, 2011 Rulings on AC's Interrogatories, etc. – Summertime is Over

The ruling below dated August 18, 2011 from the Copyright Board is bound to cause concern amongst senior administrators, advisers and even presidents of Canadian post-secondary institutions. This will especially be so for those universities and colleges that have opted out of the interim tariff – and particularly for those that have not responded to the onerous interrogatory requests from Access Copyright. Here is AC's list of the latter, which it says have not submitted interrogatory responses. These institutional entities are potentially directly and immediately affected by this decision: Acadia University Algoma University Atlantic School of Theology Brandon University Canadian Coast Guard College Canadian University College Cape Breton University Concordia University College of Alberta First Nations University Grant MacEwan University Holland College Lethbridge College Mount Saint Vincent University NorQuest College Nova Scotia Community College (NSCC) Nunavut Arctic College Portage College Saskatchewan Institute of Applied Science and Technology (SIAST) St. Thomas University University College of the North University of Guelph University of Guelph, Kemptville Campus University of Manitoba University of New Brunswick University of Prince Edward Island University of Regina University of Windsor The Board's ruling contains several warning, essentially as I had predicted in my recent blog here. The most important are these: – It warns that "An institution that does not respond as required may be compelled by way of subpoena to do so." My comment: The individual institutions in question are not actual parties before the Board, which may raise questions about the extent of the Board's jurisdiction over them. Moreover, insofar as the Copyright Board's jurisdiction is concerned, everyone is in uncharted waters in this instance because the Board has never before issued a hostile subpoena. As I have written not long ago in a 2008published paper originally presented at a Law Society of Upper Canada conference, "the Board's power to issue a subpoena under hostile circumstances is uncertain and has never been directly tested, though the sabre has been rattled on occasion." I have also pointed out that the Board, unlike the Competition Tribunal, lacks any explicit power to cite for contempt. If it were come to this, it is arguable that the Board's powers and orders may ultimately only be enforced via the Federal Court or another Superior Court. For AC to even seek a subpoena in these circumstances would be very controversial. Any subpoena issued in these circumstances could give rise to a number of very interesting legal questions and arguably might be open to judicial challenge. This may not be the best of cases for AC to test the limits and, indeed, the very basis of the Board's long-standing procedures (which differ greatly from those of normal courts) and the extent of the powers that some assume it has with respect to interrogatories and jurisdiction over non-parties or parties that have withdrawn. Still other questions concerning interrogatories and other aspects of the Board's procedures could arise out of its ruling yesterday that has "terminated" the Province of Alberta. – It warns that "Objectors may be prohibited from adducing evidence about an institution that does not respond as required." My comment: Many of these post-secondary institutions may not be concerned about this. – It warns that "A lack of information concerning copying habits at opt-out institutions might tend to increase any FTE royalty the Board may decide to certify." My comment: The Board's reasons for saying this are different than the reasons I suggested in my recent posting, but the result may well be similar – namely some serious tension amongst the internal membership of AUCC and ACCC. – It points out that the final tariff may be mandatory and retroactive and that even opt-out institutions may have to report all the information sought by AC in from January 1, 2011 in accordance with whatever terms that the Board may impose. My comment: Among many things about these possibilities that will cause concern is that the reporting requirements sought by Access Copyright are very controversial and would allow it get access for audit and survey purposes to the "secure network" and "course collection" of a university or college, which would include emails, among other things. Some institutions have openly called this "unacceptable". Indeed, even the RCMP would presumably not be allowed such unfettered access to an institution's secure network and, moreover, whatever access it would be allowed would only result from a judicially issued search warrant in the course of an investigation into a serious criminal matter and would be limited in scope to the precise needs of that investigation. The comments by the Board – particularly in paragraph 8 below of the ruling below – may cause some considerable concern at institutions that relied upon the Board's statement that the interim tariff was "not mandatory" and that they could, if they made good faith efforts to clear what needs to be cleared, including through AC transactional licenses when needed, operate without having to be bound by an unwanted license from AC. The Board states: The Board reminds the objectors that an institution's decision not to avail itself of the interim tariff in no way guarantees that it will bear no liability under the final tariff, that its liability will not be retroactive or that it will not be compelled, pursuant to the final tariff, to provide information about its copying habits during the period between January 1, 2011 and the date on which the final tariff is certified, unless it is certain that neither the institution nor its agents make any protected use of the relevant repertoire during the relevant period or periods to be set out in the final tariff. (emphasis added) This goes well beyond the Board's March 16, 2011 reasons for its December 23, 2010 interim tariff. In those March reasons, the Board said: In any event, the interim tariff we adopt in this matter is not mandatory. An Institution can avoid its application by purchasing the work, negotiating a licence to copy the work with Access or its affiliates, not using any work in the repertoire of Access or engaging only in conduct exempt from liability. The current statement of the Board seems to indicate that the full weight of a retroactive tariff – doubtless several years away at minimum – could fall on any institution that cannot prove a negative – i.e. "that neither the institution nor its agents make any protected use of the relevant repertoire during the relevant period or periods to be set out in the final tariff." That would appear to be an impossible task, since it conceptually would require the review of every single "copy" made by the institution during the previous several years to verify that no copy ever involved unlicensed use of AC's repertoire. That would be impossible enough, considering the enormous quantity of such copies involved, and could not be done unless records of each and every "copy" had been kept. And, recall that AC's proposed definition of "copy" includes a display on a computer screen, the posting of a link, and transmission by email. However, the ultimate irony is that AC has not disclosed its "repertoire" and is apparently unable or unwilling to do so. How can an institution prove that it has not used any AC repertoire when it cannot even find out what AC's repertoire consists of? Indeed, one of the reasons why Prof. Katz argued back in December that the Board should refuse to impose an interim tariff was that it would effectively be mandatory. This was because an institution may not be able to avoid its application because it would have to prove a negative, namely that it didn't use any work from AC's repertoire. The Board dismissed this argument, stating that: [46] In addition, an interim tariff does not force Institutions to prove a negative, i.e. that they do not need the tariff. In order to succeed in an action for copyright infringement, Access must first prove unauthorized uses of its repertoire in a way that is prima facie protected. So, some will wonder whether the Board is now being consistent with its March 16, 2011 reasoning that states that the interim tariff is "not mandatory" and that AC must " first prove unauthorized uses of its repertoire in a way that is prima facie protected" and its August 18, 2011 ruling that seems to require a reverse onus and the "certain" proof of a negative. As this blog has discussed at great length, no party sought judicial review of the interim tariff ruling and the deadline for doing so has long since passed. Many of the present and predictable future difficulties might have been avoided had judicial review been sought. Indeed, there was a good chance that it would have succeeded. And, predictably, others are now trying to jump on the interim tariff bandwagon. The unchallenged AC interim tariff has now inspired SOCAN to seek its own interim tariff. The August 18, 2011 decision of the Board arguably presents another opportunity to seek judicial review. Indeed, many institutions could be immediately and adversely affected if the decision stands. Moreover, the Board itself has indicated just some of the longer range possibilities that could be very problematic not only for the many institutions that want to sever relations with AC as soon as possible but for all of post-secondary institutions in Canada that are opposed to AC's current tariff application for whatever reason. In principle, any "directly affected" entity can seek judicial review. The deadline to file the required notice of application, which begins the process, would be September 19, 2011. HK ******************************************************* From: "Gilles.McDougall@cb-cda.gc.ca" <<a href="mailto:Gilles.McDougall@cb-cda.gc.ca" target="_blank">Gilles.McDougall@cb-cda.gc.ca>Date: Thu, 18 Aug 2011 14:05:07 -0400To: XXXXXXXXXXXXXXXXXXXXXXXXXX Subject: Access Copyright – Post-Secondary Educational Institutions Tariff (2011-2013) RULING OF THE BOARD This ruling is in regards to the applications made by Access Copyright in its letter dated July 20, 2011. The application for an extension of time to deal with interrogatories is granted. The schedule is modified as follows: – Deadline for exchanges of notices of the grounds for deficiencies with respect to unsatisfactory/incomplete responses to interrogatories: Friday, September 16, 2011. – Deadline for filing replies to notices of the grounds with respect to any remaining issue: Friday, October 7, 2011. [Ruling of the Board] – Deadline for filing of complete/satisfactory responses to interrogatories: Friday, November 18, 2011. The application for an order preventing objectors to file supplementary responses is denied. If better information exists, it should be provided. Adding to a response is the very purpose of dealing with deficiencies, which the Board will be asked to address after October 7. That being said, parties should not respond in a manner that forces the recipient to unnecessarily reanalyse that which has already been scrutinised. Any supplementary response should clearly indicate what is changed from the original response. The application for an order allowing Access to obtain information from institutions that do not avail themselves of the interim tariff (the "opt-out institutions") is granted. The June 6, 2011 ruling is clear: information concerning these institutions is relevant. AUCC and ACCC shall provide complete answers to the interrogatories, including (for the reasons set out by Access) interrogatories that were held in abeyance pending the negotiation of a survey, from a representative sample of opt-out institutions. The matter shall be dealt with as follows. 1) No later than on Friday, August 26, 2011, AUCC, ACCC and Access Copyright shall agree on – A list of opt-out institutions that will be required to answer interrogatories; – A letter to be addressed by them jointly to the selected institutions, requiring their participation, and; – A timetable to deal with the selected institutions' responses (filing of responses, complaints about deficiencies, etc.). 2) The letter to the selected institutions shall mention the following: – It is pursuant to an Order of the Board that the institution is required to answer the questions addressed to it; – An institution that does not respond as required may be compelled by way of subpoena to do so; – Objectors may be prohibited from adducing evidence about an institution that does not respond as required. If such an order is made, Access will still be allowed to adduce evidence about the institution, but objectors will not be allowed to refute such evidence except with leave of the Board; – An institution that does not avail itself of the interim tariff cannot take for granted that it will bear no liability under the final tariff, that its liability will not be retroactive or that it will not be compelled, pursuant to the final tariff, to provide information about its copying habits during the period between January 1, 2011 and the date on which the final tariff is certified, unless it is certain that neither the institution nor its agents make any protected use of the relevant repertoire during the relevant period or periods to be set out in the final tariff. 3) The list, letter and timetable shall be filed with the Board no later than Monday, August 29, 2011. 4) The Board will advise the parties of any changes it wishes to make to the list, letter or timetable no later than Friday, September 2, 2011. 5) The letter shall be sent to the head of the institution (or to such other person as Access and the relevant association may agree) no later than Thursday, September 8, 2011. 6) Access may file with the Board an application prohibiting any objector from adducing evidence about an institution that does not provide responses by the date provided to do so, or that does not remedy a deficient response by the date provided to do so. Once such order has been issued, Access will be allowed to adduce evidence about the institution, but objectors will not b allowed to refute such evidence except with leave of the Board. 7) A lack of information concerning copying habits at opt-out institutions might tend to increase any FTE royalty the Board may decide to certify. This would happen if the average volume of copying of works from Access Copyright's repertoire by opt-out institutions was less than by other institutions. This will not prevent the Board from certifying such a royalty based on an imperfect record. 8) The Board reminds the objectors that an institution's decision not to avail itself of the interim tariff in no way guarantees that it will bear no liability under the final tariff, that its liability will not be retroactive or that it will not be compelled, pursuant to the final tariff, to provide information about its copying habits during the period between January 1, 2011 and the date on which the final tariff is certified, unless it is certain that neither the institution nor its agents make any protected use of the relevant repertoire during the relevant period or periods to be set out in the final tariff. Indeed, the absence of evidence on the copying practices of opt-out institutions can only make it more difficult for the Board to design the final tariff so as to respond to any legitimate concerns of these institutions. Gilles McDougall Secretary General | Secrétaire généralCopyright Board of Canada | Commission du droit d'auteur du Canada 56 Sparks, Suite| Bureau 800 Ottawa ON K1A 0C9 Telephone | Téléphone 613.952.8624Gilles.mcdougall@cb-cda.gc.ca ***********************************

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