On April 23, 2022, the European Parliament and Council reached a provisional political����on the Digital Services Act (DSA). Based on the principle that what is illegal offline should be illegal online, the DSA imposes digital regulations with the goal of stopping the spread of illegal content and ensuring the protection of users’ rights.

The rules set out in the DSA primarily apply to online intermediaries and platforms providing services in the European Union (EU), including online marketplaces, social networks, content-sharing platforms, and app stores. The legislation will impose obligations on regulated entities that are proportionate to the nature of their services and size of their user-base. For example, very large online platforms (VLOPs) and very large online search engines (VLOSEs) with more than 45 million active monthly users will have more stringent responsibilities than micro and small enterprises.

The DSA is set to impose a series of new requirements that will have a significant impact on online business:

1. Online Marketplaces: The DSA will impose a duty of care on online marketplaces in relation to the sellers who list items or services for sale on the platforms. These marketplaces will also have to collect and display certain information in association with listings to better inform consumers.
2. Risk Management: VLOPs and VLOSEs will be obligated to carry out an annual risk reduction analysis aimed at reducing risks associated with (i) the dissemination of illegal content; (ii) adverse effect on fundamental rights; (iii) the manipulation of services that affect democratic processes or public security; and (iv) adverse effects on gender-based violence, minors, and users’ health.
3. Dark Patterns: The DSA will prohibit the use of confusing or deceptive user interfaces and practices that are aimed at misleading users.
4. Recommendation Systems: To improve transparency, the DSA will mandate that VLOPs and VLOSEs offer systems for recommending content to users that is not based on their profiling.��
5. Crisis Response Mechanism: Influenced by the conflict in Ukraine, the DSA allows the European Commission to analyze the impact of VLOPs and VLOSEs on a crisis that is affecting public health or security. Based on this analysis, the European Commission may put in place select measures for the respect of fundamental rights.
6. Minors: Platforms will have to implement protection measures to ensure the online safety of minors, including prohibitions against targeted advertisements based on minors’ personal data.

The provisional agreement is subject to approval by the European Council and Parliament. Once adopted, the DSA will apply 15 months or from January 1, 2024, whichever is later, after entry into force. For the VLOPs and VLOSEs, the DSA will apply four months after their designation.

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The US doctrine of copyright exhaustion ()��states that a copyright owner's exclusive right of distribution in a copyright-protected work is exhausted upon first sale of that item (hence the doctrine of exhaustion's other name: the first-sale doctrine).�� Although Canada's��Copyright Act among those rights enjoyed by the owner of copyright in a work, Canadian copyright law has functional equivalency by operation of other doctrines. �� However, copyright exhaustion is an important consideration elsewhere in the world as the question of whether purely digital goods such as ebooks, MP3s, and audiobooks may be resold on secondary markets is still a contentious question.

On June 15, the German Court of Appeal of Hamm released the first appellate-level decision��on the application of the doctrine of copyright exhaustion to digital goods��since the Court of Justice of the European Union (CJEU) decided����in 2012.��������峧�Ǵڳ���was a case involving the resale of licences to software distributed by Oracle. After passing through Germany's court system, the case reached the CJEU, which ruled that the doctrine of exhaustion applied to Oracle's exclusive right to distribute the software in question. Further, it held that the second owner of the software licences could use those licences to download updated versions of the software from Oracle.��

Last week's decision by the Court of Appeal of Hamm��is currently only , but from what information is , the appeal court upheld the decision of the trial court and concluded that the��UsedSoft decision was��lex specialis��and only applied to the . The Software Directive, as its name suggests, governs software, while other kinds of digital media such as ebooks and audiobooks instead fall under the purview of the .��

After UsedSoft, there was much speculation about whether the CJEU’s decision regarding copyright exhaustion under the Software Directive would also apply to works falling under the scope of the InfoSoc Directive. With this decision, it appears that computer programs like the one at issue in UsedSoft are subject to different judicial treatment than other commonly-traded digital goods such as ebooks.

The court’s decision here was a victory for copyright owners and distributors of works in digital format, as it provides them more control over the sale and resale of such goods online. However, even if the court had extended the doctrine of exhaustion to the InfoSoc Directive, it is likely that copyright owners could have used other exclusive rights granted by copyright statutes to block the development of secondary markets for digital-format works. The copyright owner’s exclusive right of reproduction is a strong tool against the��resale of digital goods as the transfer of a file from one user to another necessarily requires the reproduction of that file. This tactic was used in the United States case in response to efforts by ReDigi to launch a pre-owned marketplace for digital music using the doctrine of exhaustion as a defence. Capitol Records successfully argued that even if its distribution rights in the music files were exhausted, it retained its exclusive right of reproduction. Because of the nature of online file transfer, it contended that every transfer of a copyright-protected file would constitute copyright infringement by way of the reproduction of the file on the recipient’s computer.

While there may be other legal routes to the establishment of secondary markets for digital-format goods, it appears that one of the more promising arguments in favour of digital resale has been dealt yet another blow with the latest decision out of Germany. It remains to be seen whether inventive defences to copyright claims may allow for the creation of such markets, but the legal battles over the growing market for digital goods are only just beginning.

��

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(of Gowling Lafleur Henderson LLP) moderated the final panel of the day entitled “Piracy & Digital Distribution”, in which panelists (of Basman Smith LLP), Steve Teixeira (of Universal Music Canada Inc.), and Osgoode Hall Adjunct Professor (of the Motion Picture Association - Canada) spoke about how piracy has affected their respective industries of sports, music, and film.

Kevin Fisher discussed the unique aspects of piracy in live broadcast sporting events. ��Since the value in a sporting event exists in the broadcast, the piracy in this industry includes satellite signal theft, grey market and free-to-air systems, and event channel streaming online. Individuals can legally purchase a broadcast, set up an event stream on a user generated site, and broadcast the stream to the world. This has also led to a new sub-industry of directory sites that guide users to the pirated streams.

Steve Teixeira began his discussion by asking whether anyone in the room has��ever pirated music, and most of those present raised their hands. However, when he asked how many people had stolen a physical CD, only one hand remained raised. Teixeira posited that this disconnect was the result of how the public values (or perhaps, devalues) the more abstract concept of digital music products as compared to physical products. He suggested that this social acceptance of piracy has serious implications for the industry and provided some insight on how the industry will move forward to work towards recapturing paying consumers.

Sundeep Chauhan discussed the increasing trend of dressing up pirated DVDs to look like legitimate products��and selling them at a slightly lower price point, and the resultant displacement of the legitimate physical product market. He also discussed the impact piracy has had on the film ecosystem. Money taken out of the industry due to piracy has disrupted the ability of film makers to reinvest in the film industry. The trickle down effect of piracy has also resulted in job losses both within the industry and for those with jobs related to film production (such as makeup artists, chauffers, general contractors, etc.).��

All three panelists agreed that litigation against end user consumers is not the goal of rights holders.�� After initial attempts to enforce rights against individuals by the music industry resulted in a public relations backlash, content owners realized that it does not make sense to alienate their consumers. It stands to reason that aggressively pursuing consumers and then turning around and asking them to purchase your content was not a viable strategy. Now, the goal is to pursue those who make content available and make profits through subscription fees and advertising revenue. These sites, referred to as “wealth destroyers” (Pirate Bay was an oft-mentioned example), drew criticism as they capitalize on the investments of others while drawing away the profits to be gained from those ventures.

The panelists highlighted education as an important resource to combat piracy. Erasing the grey area and shaping cultural values about online theft through education will be a valuable tool for content owners moving forward. Intermediary companies will also require this education. These companies pay for advertising space or are involved with the authorization of purchases on sites hosting pirated content. The damage done by "wealth destroyers" can be reduced, and hopefully eliminated, ��if companies are made aware of the consequences of their participation in piracy.��

Although industries affected by piracy were initially resistant to new business models made possible by technological advances, entertainment industries are increasingly embracing emerging business models. The goal of these companies is not to resist innovation, but to ensure that the technology developers and entertainment industries collaborate to improve their products and services. For example, the key to the future use of technological protection measures (TPMs) is to reduce the restrictions placed on users while maximizing protection against would-be pirates. In the past, implementing TPMs often meant that individuals could not use their legally purchased content in legally protected ways��such as��format shifting. Now, TPMs facilitate new business models like iTunes, allowing rights holders to protect content and feel secure about releasing it online while providing their product to the consumer.��For example,��providing a time-limited movie rental at a lower price in addition to a purchase option.��The use of these services allow further opportunities to meet the needs of different consumers by allowing for such things as differentiated pricing options.

It is clear that the entertainment industries are working to embrace technological changes and the new methods in which they can provide content. Teixeira noted that as time goes on, music streaming may become the way of the future. Whether it is through subscription or advertising models, the hope is to eventually increase revenue streams��as these services build up a consumer base. Fisher suggested that with the right technology, live sport streaming can cut out the pirates as well as divert more revenue away from the middle men and directly back to content creators. Chauhan indicated that filmmakers want their content on as many platforms as possible and to work with consumers to provide options catered to their needs, making it just as easy to access legal content as it is to find pirated content.����Perhaps embracing the very technology that initially allowed bootlegging to run rampant will end up saving these industries from piracy.

��Allison McLean is an IPilogue Editor and a JD Candidate at Osgoode Hall Law School. ��

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Voltage Pictures LLC is a��Los Angeles-based studio engaged in the production, finance, and international sales of many popular movies, including the Academy Award-winning film "The Hurt Locker" (2008). In 2012, Voltage retained anti-piracy firm to determine if any of Voltage’s works were being shared via P2P networks in Canada, such as BitTorrent. An investigation determined that Voltage’s works were being seeded by users associated with around 2000 IP addresses.

Voltage, in response, sought a so-called Norwich Order requiring the ISP TekSavvy Solutions Inc. to provide the names and addresses��of account holders associated with the internet protocol (IP) addresses in question. While TekSavvy took no position on the motion, the Samuelson-Glushko Canadian Internet Policy and Public Interest Clinic () was granted intervenor status to oppose the order, arguing that privacy considerations and the interests of justice should militate against ordering the ISP to divulge user information.

The Troll Toll – Abuse of Process and the Federal Court

“Copyright trolls” use the threat of litigation to effect quick settlements. These organizations send threatening and often misleading letters to individuals suspected of infringement, implying that liability is a foregone conclusion and demanding relatively small settlement amounts, usually low enough that retaining counsel to mount a full defence makes no economic sense. Frequently, such organizations threaten liability based on the – adding a layer of embarrassment to the demand and further extorting quick (and quiet) settlements from individuals.

To be clear, the plaintiff in Voltage Pictures LLC v John Doe and Jane Doe does not exhibit all of the characteristics of a typical troll. The plaintiff is engaged in a legitimate business, and does not depend on quick settlements as its primary means of generating profit. Further, Voltage produces critically acclaimed movies – not the pornographic content frequently associated with such trolls. However, the order sought by Voltage is so strongly associated with troll-like practices that, in my opinion, the spectre of the copyright troll must have heavily influenced the reasoning behind the order and the conditions under which it was granted. The Federal Court, while aware of the need to facilitate the protection of copyright, also recognizes the need to balance that interest with the prevention of the abuse of its processes.

Standards for Granting the Order – A Bona Fide Case

The specific order sought by Voltage was an equitable bill of discovery, also known in Canada as a Norwich Order after the decision of the House of Lords in . The order was described in as an “ancient” form of pre-action discovery which permits a court, through its equitable jurisdiction, “to order discovery of a person against whom the applicant…has no cause of action and who is not a party to the contemplated litigation.” These orders are meant to facilitate the discovery process where some third-party has relevant information not otherwise available to a plaintiff.

The intervenor CIPPIC strongly emphasized the need to protect the privacy of users, and therefore argued that the applicant had to satisfy a higher standard of a��prima facie��case before the Court could justify the disclosure of users' personal information. The Court disagreed, reviewing cases from other jurisdictions and concluding that even in the US, where a nominal prima facie standard was required, it was unclear if that standard was maintained in practice.

Slaying the Troll?

Prothonotary Aalto’s decision contains a review of case law from the US and the UK, which notes the shortcomings of judicial practice in jurisdictions where open-ended orders allowed the applicants to use the orders unfairly, by sending misleading letters to persons suspected of infringement. These letters, among other things, suggest that liability is a foregone conclusion and extort settlements from the recipients with no intention of pursuing further legal action on the part of the applicant.

In order to avoid similar abuses, this decision holds that courts should balance the privacy rights of potentially innocent users against the right of copyright holders to enforce their rights. To maintain this balance, where evidence suggests that a copyright holder is motivated by an improper purpose, the Court ought to subject the order to more stringent conditions. In some cases, where there is compelling evidence of improper motive, the Court may deny the motion entirely.

In this instance, the Court held that Voltage had met the lower bona fide standard, and allowed the order – however, it made the order subject to certain conditions meant to curb potentially abusive practices, including:

• making the order subject to oversight by a Case Management Judge;
• ensuring that the letter contains no inappropriate language by subjecting a draft demand letter to review by the Court;
• requiring a statement in the letter that liability for infringement has not yet been established and recommending that recipients seek legal assistance;
• requiring reimbursement of the��reasonable costs and disbursements of TekSavvy incurred in providing the necessary information; and
• limiting the information provided to the name and address of the IP addresses implicated in file sharing of the protected works (and not the personal phone numbers or email addresses of such individuals).

Attaching similar conditions to Norwich Orders may well render large-scale actions against individual non-commercial infringers economically unfeasible. In any case, it will be interesting to see how the enforcement tactics of rights-holders develops over the next few years, in the context of a Court cognizant both of the extent of internet piracy and the increasing importance of preserving online privacy.

David Bowden is an IPilogue Editor and a JD Candidate at Osgoode Hall Law School.

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In Justice Campbell found a clear infringement of the when the defendant Hernandez streamed and allowed for download an 700 episodes between his two websites “Watch The Simpsons Online” and “Watch Family Guy Online.”

As the judge stated in his decisions, this fine is meant to release the hounds on illegal downloading and streaming communities.

Statutory damages, elected by Twentieth Century Fox in this case, would be insufficient to achieve the goal of punishment and deterrence of the offense of copyright infringement in this case. Hernandez’s repeated, unauthorized, blatant, high-handed and intentional misconduct, and his callous disregard for the Plaintiff’s copyright rights, is deserving of the penalty of punitive damages.

The damage award breaks down into $10M in statutory damages under , $500,000 in punitive damages and $78,000 in costs.

Section 38.1 of the Copyright Act��outlines that judges may consider three relevant factors in awarding statutory damages: the degree of good faith of the defendant, the conduct of the parties before and during the proceedings, and the need to deter other infringements in question. In addition to the deterrence motivation, the judge found that Hernandez violated the Copyright Act in bad faith and for commercial purposes through pay-per-click ads on the site. (And you don’t win friends with bad faith.)

As outlined in the judgment, Hernandez easily met the core technical requirements for infringement by doing the following with the video content: copying it onto a computer system, uploading it to a server, creating links to the server, and enabling the public to access the material through the internet.

For those saying, “What the deuce?” to this damage award, in my opinion, it is not completely outrageous on its face.

Justice Campbell provided a strong synopsis of copyright damage types, sizes and relevant factors in . There he reminds that the Copyright��Act dictates a fine of between $500 and $20,000 per infringed work depending on various considerations.

Pursuant to s. 38.1(1) of the Act statutory damages may be awarded “in a sum of not less than $500 or more than $20,000 as the court considers just”, with the proviso that, pursuant to s. 38.1(3), even the minimum amount can be lowered on the basis of proportionality of damages to the infringing activity, “as the court considers just”. Pursuant to s.38.1(5), the following factors are to be taken into consideration in awarding statutory damages: the good faith or bad faith of the defendant;��the conduct of the parties before and during the proceedings; and the need to deter other infringements of the copyright in question.

At 700 episodes of evidence, a $10M statutory court awarded $14, 285 in damages per episode, is certainly within the legislatively prescribed range.

In an interesting approach, the plaintiff didn’t put forward a defence at trial. It doesn’t take a lawyer to know that this “If anyone needs me, I’ll be in my room” approach is a bad idea. Judging from , it’s unlikely his thoughts on the issue – that he didn’t think he was doing anything wrong and also offered links to purchase Fox materials – would have mitigated damages significantly. I don't think it would have hurt him much either.

Since Fernandez didn’t actively engage with the legal system, and seems to treat access to others' creative works as a right, I’m not prepared to side with him. Nor am I prepared to side with the judge in this case or creators' rights advocates. The extremism of this judgment reinforces the David versus Goliath archetype of copyright battles. Is it reasonable to expect a 23-year old to pay $10M in damages? I doubt it. Granted, it could be argued that the purpose of the statutory damages award in this case is to send a message rather than receive compensation. In my mind, awarding these symbolic damages sets a dangerous precedent. Without knowing how much money Hernandez made from the internet ads, or how much Twentieth Century Fox lost in sales, I think it would have been more reasonable to treat each season of each show as a breach. Perhaps I've been soured by the progressive decline of these shows in recent years.

Ultimately, there's a bigger problem here. We have a generation of young people who are drastically out of step with the law as it stands. It seems most of them, like Hernandez, know some of the contours of the law but disagree with it. The law's purpose is to protect creators - defending their income and sustaining their ability to create - but it is also to protect the interests of the public and further the public domain. When applying it against the interests of 23-year-old kids, it's no wonder young people think Goliath writes the rules. Any damage award would have sufficiently sent the message that infringing copyright is wrong. In my opinion, awards this extreme make one wonder if we're achieving the objectives of the Copyright Act and if we are, whether we need to rethink those objectives.

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The panel addressed the international aspects of UGC in two different ways: both through public international law obligations imposed on Canada as a result of international treaties, and through addressing private international law issues concerning liability and potential defences to infringement in different jurisdictions.

Sookman: Is the UGC Exception in Conformity with International Treaty Standards?

Barry Sookman's talk focused on whether or not the UGC exception complies with international obligations, in particular the ��(and the provisions of Berne incorporated into the WTO's ).

Sookman has previously mentioned that the Copyright Modernization Act could run afoul of Canada's international obligations by creating “” of new exceptions. His presentation during Thursday's panel elaborated upon how the UGC exception could fail to satisfy the “three step test” for permissible exceptions to copyright protection provided for in: where the exception applies only in “certain special cases”, does “not conflict with normal exploitation of the work”, and does not “unreasonably prejudice the legitimate interests of the author”.

Sookman argued that the UGC exception, which applies to all works and subject matter so long as it is used in a non-commercial context does not qualify as a “special case”, nor is it “certain” when it would apply. Moreover, the provision that addresses economic impact (at ) uses the terminology “does not have a substantial adverse effect”, rather than “does not conflict with the normal exploitation of the work” - which raises questions about whether the provision creates a higher burden for rights holders than expressed under the Berne Convention.

Finally, Sookman took issue with the fact that s 29.21(1)(d) seems to allow users to unreasonably prejudice the interests of the author, as the provision does not clearly allow authors to exercise their moral rights in the context of UGC. In comments which echoed the concerns of Marian Hebb, a panelist from earlier in the day, Sookman pointed out that the exception may not allow an author to prevent certain uses of her works for non-financial reasons – including prejudice to her honour or reputation.

Blom: Private International Law and the UGC Exception

Prof. Joost Blom of the UBC Faculty of Law rounded out the panel by talking about the UGC exception in the context of the Conflict of Law rules. Prof. Blom's discussion of IP liability and jurisdiction seems particularly important given the global operation of the market for copyright-protected subject matter and a by the European Court of Justice (to see the IPilogue's coverage of this decision, click ).

Blom began his presentation by outlining the three fundamental questions posed by private international law:

1. Jurisdiction (Where can a proceeding can be initiated?)
2. Choice of Law (Under what rules is a proceeding decided?)
3. Foreign Judgments (Will a judgment in a proceeding be enforced in another jurisdiction?)

Blom indicated that although IP rights are territorially defined, much infringing activity takes place either abroad or on the Internet (the nature of which can make the question of where an infringement has occurred very difficult to determine). In previous infringement proceedings involving the Internet, the Supreme Court has held that a plaintiff must establish a “” between the actionable wrong and Canada before a Canadian court may assume jurisdiction over a proceeding. However, as mentioned by Prof. Blom, this terminology is not specific enough to allow Canadian users to adequately assess their risks before reproducing or communicating their personal UGC.

Prof. Blom provided a powerful example of the potential international liability of creators of UGC, even given the recent amendments to the Copyright Act. Imagine a group of UBC students use five popular songs in a “flash mob” demonstration on campus. The flash mob is recorded, and the subsequent recording is uploaded on YouTube.

In this scenario, the student group has potentially infringed on three different exclusive rights: the right of reproduction, the right of performance and the right of communicating the work to the public. The first two acts occur in Canada, but the third could occur anywhere in the world – and although the UGC exception could exempt the student group from liability in Canada, it would be ineffective against a proceeding brought under any other jurisdiction (such as the USA).

Prof. Blom's presentation, therefore, served as a strong reminder that in the digital age, a domestic exception to copyright infringement only provides limited protection when the new work is provided on the Internet.

David Bowden is an IPilogue Editor and a JD Candidate at Osgoode Hall Law School.

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, the United Kingdom (UK) communications regulator, topical data on digital downloads that violate copyright regulation. This study, based on market research with a sample of over 5,000 individuals, is an expansive and reliable glimpse into the downloading habits of internet users. The key findings are:

• One in six (17%) UK internet users over the age of 12 downloaded at least one piece of illegal content over the three month monitoring period
• 4% downloaded exclusively illegal content
• The top 10% of infringers were responsible for 79% of all illegal downloads
• Men are more likely to download illegal content than women
• Those under 34 years of age are more likely to download than those 34 and older
• Movies were illegally downloaded more than any other type of content
• uTorrent was the most common platform used for illegal downloads
  
  

Context and Methodology Analysis

To provide some context, these overall rates are lower than some of the hype would have us believe. As someone who has been following illegal downloading trends since the inception of the technology, I was surprised and delighted that fewer than one in five people download illegal content.

But it's not all good news. The age bias could indicate a darker hypothesis that I've held for many years - that the more technical capability individuals have, the more likely those individuals are to download illegally. Torrenting or competing methods require a sophisticated knowledge of the internet that is statistically less likely to be held by older users. It's possible that baby boomers are purchasing their movies on iTunes simply for the ease-of-use and straightforwardness of the service. Unfortunately, this hypothesis is immensely difficult to prove. As a former market researcher, I'm cognizant of the response bias that surveyed populations have when it comes to answering questions about their propensity to participate in illegal activity. Regardless of how solidly the questions were drafted, people would under-report their likeliness to illegally download copyright protected material.

This is the brilliance of the methodology employed in the Ofcom study; monitoring actual behaviour rather than asking participants to report behaviour leads to greater accuracy. The study is also methodologically sound because it has a large sample size, and a sample size recruited in multiple different ways.

It also goes above and beyond traditional polling techniques in one other important way. Eighteen years and older is a common way to begin a population sample; however, as this study confirms in its decision to include participants as young as 12 years old, practical internet studies should include teens and pre-teens in order to be as accurate as possible. Teens use the internet extensively - both while mobile and at home - and so they should rightly be included to assess internet usage behaviour by the population as a whole.

One caveat to the sample, and perhaps an obvious one, is the regional bias. The sample is entirely drawn from the UK and as such, the data is only truly representative of that area of the world. While this data may also be directionally representative for Anglophone Western countries with similar internet penetration rates, it would not be a useful reference when looking at many other countries and regions around the world.

Conclusion

Ofcom's work is incredibly important here. There is simply no replacement for reliable, open, and accessible data. Moreover, this study is ongoing, which provides valuable benchmarking and trend tracking. For Canadians reviewing the research, this study raises the natural question: what exactly is the Canadian Radio-Television and Telecommunications Commission (CRTC) doing research-wise? The answer may surprise you. They do, in fact, provide some statistical information regarding .

But they can do more, and they can do it better. Canada deserves a high-calibre, internet-usage think-tank akin to the United States' . Up until now I've always envisioned it to be executed by StatsCan, but perhaps the CRTC is a better fit to take on and drive this project. Canadians need more accurate data collection about our internet penetration, usage, and most importantly, the way it is impacting our daily lives.

Ultimately, in my opinion, the important question isn't how many Canadians are downloading illegal material. The core question is: are we trending toward more or fewer illegal downloads? And if we are trending upward, such a finding is a fundamental starting point to launching a much-needed national debate on piracy in Canada.

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Why a Negligence Claim?

The issue with many internet piracy claims is that it is����who actually committed the wrongful act. Pirating activities can��usually��only be traced back to a unique IP address. That IP address identifies a single modem, which may provide countless users access to the��Internet. Without knowing which of those users performed the piracy, rights holders cannot pursue an action. This issue is exasperated when an unsecured wireless network is involved, as any number of uses may connect without the operator's consent or even their knowledge.

In these cases of unprotected WiFi networks, rights holders are����that leaving them unsecured is negligent, and as a result want to hold network operators responsible for pirating activities which occur on their network.

Negligence in a Nutshell

The tort of negligence continues to evolve, but essentially requires proof of four key elements. First, the defendant must have a special relationship to the plaintiff, known as a��duty of care. Only when a legal duty exists can a defendant be found to breach it. Second, the defendant must have acted or failed to act in a way that breaches the��standard of care��he owed to the plaintiff. What standard the legal duty imparts on the defendant is often heavily debated, but some form of a reasonable person is usually considered in its determination. The last two elements are that the defendant's failure to meet that standard of care caused damage to the plaintiff and there must be��measurable damage��which was��caused��by the breach of duty.

All of the unsecured WiFi����so far have focused on the first two elements, a duty of care between the defendant and the rights holder, and what standard of care the defendant owed if there was such a duty.

The Case For Negligence

One key tenet of negligence law is the compensatory principle that losses incurred should be made up for. When the defendant solely caused the loss, it is clearly just to impart those costs on the defendant. It becomes more difficult when the defendant did not directly cause the loss, but only created a situation which allowed for the potential of a third party to inflict a loss. A real dilemma��comes when the third party is unknown, or unable to compensate the victim. Then the court must choose which of two parties will bear the loss; the victim who is completely innocent, or the party who created the situation enabling the third party to subsequently inflict the loss. In these cases, courts have sometimes held the party who created the situation liable for the loss inflicted by the third party.��This still requires a special relationship where the defendant had a duty to act without negligence, and that they acted in breach of that duty by creating such a situation for a loss to be imposed by a third party.

To find negligence in the case of an which a third party used to pirate copyright-protected content, there must be a duty that was breached. Plaintiffs in cases involving these situations have argued that since the network operator is creating an opportunity for a loss to be inflicted by a third party, that leaving a WiFi network unsecured is negligence. They suggest that operators of WiFi networks have a duty to content owners to avoid facilitating the infringement of copyright-protected content and as such should ensure that their networks are secured, and thus only accessible by themselves and other authorized parties. They view having an unsecured WiFi network as below the standard of care expected of WiFi network operators.

The Case Against Negligence

Two strong issues have so far hindered these negligence claims, both discussed in��. The first is that every network operator does not have a legal duty to every rights holder. The courts have found this would be a vast expansion of the duty of care. The second is that even if there was a duty of care, leaving a WiFi network unsecured is not negligent. The courts have found many cases where it is reasonable and even encouraged to have an open WiFi network. Considering public areas like airports, coffee shops and schools, along with the practice of most private individuals, the court has not seen it prudent to set the standard of care as requiring WiFi networks be secured.

Future Claims?

While the courts have set a clear stance in the cases above, one wonders if negligence might gain traction in other instances of technology usage. Could it be seen as negligent to use weak passwords, or leave login credentials in plain sight? What about failures to use anti-virus software, or the transmission of sensitive��data over unencrypted networks? As technology and its use continues to��permeate��our lives, I think those who suffer losses may increasingly look to negligence law for compensation, and answers to these difficult questions.

Alex Buonassisi is an IPilogue Editor and a JD Candidate at the University of British Columbia.

The post Running An Unsecured WiFi Network Is Still Not Negligent appeared first on IPOsgoode.

This historic event reverberated in a number of domains.

These five judgments mark the final moments before a long anticipated major reform in Canada’s copyright law: on 12 July 2012, when the five judgments were released, the Copyright Modernization Act had been passed by Parliament but had not been declared in force.[6]

In addition to marking the end of one version of the Copyright Act, in the context of intellectual property development in Canada, the “pentalogy” instantly enormously multiplied the total jurisprudence from Canada’s highest court that bears on copyright. Indeed, between the time McLachlin J became Chief Justice of the Supreme Court in 2000 and the release of the pentalogy, there had only been five copyright judgments from the Court:[7] �ճ�é��������� v Galérie d’Art du Petit Champlain [�ճ�é���������],[8] CCH Canadian Ltd v Law Society of Upper Canada [CCH],[9] Society of Composers, Authors, and Music Publishers of Canada v Canadian Association of Internet Providers [SOCAN v CAIP],[10] Robertson v Thomson Corp [Robertson],[11] and Euro-Excellence Inc. v Kraft Canada Inc. [Toblerone].[12] Taken together, these ten cases represent a greater volume of interest from the Supreme Court in copyright than has been evinced at any time since it became Canada’s final appeal court.[13] For example, in Ian Bushnell’s history of the Federal Court, spanning 1875 to 1992, there is mention of only one intellectual property case being appealed to the Supreme Court,[14] a trademark case, Benson & Hedges v St. Regis Tobacco Corporation.[15] Others did reach the Supreme Court but did not merit discussion in Bushnell’s history: for example, in copyright, on appeal from the Exchequer Court (predecessor to the Federal Court), the Supreme Court decided Cuisenaire v South West Imports Ltd in 1969—but consideration of copyright by the Supreme Court under previous Chief Justices has definitely been infrequent.[16] One reason for this relative paucity of copyright cases in the Supreme Court may be the strong contribution to intellectual property jurisprudence between 1964 and 1980, which is universally acknowledged as being made by Jackett CJ of the Federal Court.[17]

But, beyond the context of copyright jurisprudence, the release of these five copyright decisions together was a landmark in the history of Supreme Court jurisprudence in general. This chapter will focus on the historic copyright “pentalogy” but, rather than considering these judgments primarily in light of Canadian copyright jurisprudence— or, indeed, in light of intellectual property jurisprudence more broadly—the discussion will focus on these five judgments in the context of Canada’s Supreme Court jurisprudence generally...

The post The Context of the Supreme Court’s Copyright Cases appeared first on IPOsgoode.

Of the five cases, two do not seem particularly controversial. In the first case, Re:Sound v Motion Picture Theatre Association of Canada,[3] which involved the 1961 Rome Convention,[4] a unanimous Court agreed with the Copyright Board that sound recordings embedded in movie soundtracks were not (or were no longer) to be treated as sound recordings under the Copyright Act,[5] thus rejecting the application in Canada of an Australian precedent based on a similar fact pattern but on very different statutory language. Given the wording of section 2 of the Act, the outcome seems reasonable. While the Rome Convention might have led the Court to take a longer look at the appellants’ arguments that a pre-existing sound recording reproduced in a soundtrack is still a sound recording and/or that a new sound recording is created by ripping the soundtrack—based on the principle that statutes should be interpreted in accordance with treaties ratified or adhered to by Canada[6]—the statute seems rather unambiguous in defining a soundtrack as something other than a phonogram because it is not exclusively “aural”.[7] The idea that an existing sound recording ceases to exist under Canadian copyright law when (while) it is embedded in a soundtrack and re-emerges when ripped would deserve a longer comment, but the point is not one I wish to belabour here.

In the second case, Rogers v SOCAN,[8] the Court decided (unanimously on this point[9]) that a series of point-to-point on-demand transmissions of works constituted a form of communication to the public (covered by an exclusive right) even if each individual transmission was not, at least colloquially, public. The Court referred to the WIPO Copyright Treaty[10] and the making available right in that context. That case was, I believe, rightly decided if the normative basis for the definition of “public” that has applied to signals sent to groups of private homes, hotel rooms, etc. (which, together, constitute a “public”) is to be followed.

Two of the three other cases in the pentalogy were 5-4 splits. Not surprisingly, they are controversial. I return to those two cases below. I will also mention the fifth (and last case) of the pentalogy, namely SOCAN v Bell, later on. It is not particularly controversial but it needs to be contextualized. However, before embarking on our review of the cases, I wish to take the reader for a quick a tour of ancient China and Greece...

Featured here is the first part of a book chapter written by Daniel Gervais, Professor of Law and Director of the Intellectual Property Program at Vanderbilt University. The full chapter is available for download . The book is entitled "The Copyright Pentalogy: How the Supreme Court of Canada Shook the Foundations of Canadian Copyright Law" edited by Michael Geist, and is available for purchase or download .

The post The Internet Taxi: Collective Management of Copyright and the Making Available Right, after the Pentalogy appeared first on IPOsgoode.