Pankhuri Malik is an IPilogue Writer, IP Innovation Clinic Fellow, and an LLM Candidate at Osgoode Hall Law School.

Streaming giant Pandora has been hit with . In early February 2022, Pandora was sued in a series of lawsuits from the estates of comedians such as Robin Williams, George Carlin, Bill Engvall, and Ron White for publicly broadcasting, reproducing and distributing their copyright protected content without obtaining licenses.

Initial lawsuits

Pandora was named in a series of copyright infringement suits in early February this year that were later combined into one action before the United States District Court in the Central District of California.

The plaintiffs contended that comedy works are subject to the same copyright rules as musical works. This means that, like musical works, comedy works are also subject to two separate copyrights: one in its recording and one in the underlying literary work. While musical works are licensed as two separate rights accordingly, comedy works are only licensed as recordings without the underlying literary license. The plaintiffs contend that this constitutes copyright infringement.

According to Pandora’s own reports, in January 2022, Bill Engvall, George Carlin, and Ron White garnered 227,000,  81,000, and 233,000  monthly listeners, respectively. The total valuation for damages in the suit exceeds $70 million.

The tussle between comedians and streaming services is not new. Following pressure from artists for appropriate licensing and royalties for the underlying literary content, Spotify recently chose to belonging to multiple comedians that are represented by literary works rights agencies, such as John Mulaney, Kevin Hart, Jim Gaffigan, Larry the Cable Guy, and Jeff Dunham.

However, Pandora’s case is distinguished by its alleged admissions of copyright infringement in to the United States Security and Exchange Commission (SEC) from 2011 to 2017. The plaintiffs claim that Pandora admitted that it does not have the necessary public performance licenses for their comedy recordings and may face copyright infringement actions from rights-owners. Following the filing of the lawsuits, Pandora has also removed the comedians’ content before issuing its response. 

Pandora’s response

Pandora filed a counterclaim accusing Word Collections, the comedians’ performing rights collection agency, of anti-competitive practices. Pandora claims, as it did in its SEC filings, that its licensing of only the sound recording, without obtaining the underlying rights, conforms with “industry-wide custom and practise” and Word Collection is attempting to illegally monopolise its content in contravention of the .

Industry-Wide Custom and Practice?

While Pandora’s claim of its actions being in line with industry-wide custom and practice may not be unfounded, this is a valid defence in a copyright infringement action.

Pandora also claims that the system of licensing rights separate from the different right owners for musical compositions is inconvenient, “”, and should not be adapted to cover comedy recordings. Pandora argues that unlike musical works, comedy is written and performed by the same artist and therefore does not need separate protection.

This argument, however, may not have sufficient merit since a) various musicians write and perform their own music; and b) the licensing process simply being complicated is no excuse to forego it.

What’s next?

There has been increasing backlash against Pandora, among other streaming services like Spotify, outside of Court. Another prominent comedian, Lewis Black, issued a public statement asking Pandora to remove his works from its platform. Black said that while he does not need the money or exposure that Pandora claims to offer, it is time for comedians to be recognized and compensated for their writing in addition to performance.

Many expect the suit against Pandora to illuminate the stance of the law going forward. If the comedians succeed, it would open a floodgate of actions against streaming services for appropriate licensing of comedic works.

The post No laughing matter – Lawsuits for protection of copyright in Stand-up Comedy appeared first on IPOsgoode.

Procedural History

In May 2010, a collection of lawyers and law firms in Canada launched a class action suit against Thomson Reuters, alleging that the company’s Westlaw “Litigator” service directly infringed works in which the individual members owned copyright. The claim, led by representative plaintiff , alleged infringement in over 50,000 works available through the Litigator service, and sought general damages of $50 million, as well as $1 million in Punitive Damages (IPilogue’s coverage of the initial is available ).

In February 2012, for the proposed action under the , 1992, SO 1992, c C-6 (for IPilogue’s coverage of the certification, see ). In the decision granting certification, the Court noted certain public policy problems involved in granting copyright protection to the types of material included in Westlaw’s Litigator service. Citing IP Osgoode's , Judge Perell noted in paragraph 93 that recognition of copyright in such materials

would affect the ability of lawyers to serve other clients and would detract from the profession’s obligation to serve the public to the best of its ability, would promote needless variety when standardization and consistency in legal expression would be beneficial, and would monopolize legal services and suppress healthy competition.

However, as this was a certification proceeding, the Court declined to rule on the merits of the action and specifically made no finding on the existence or restriction of copyright protection in court documents.

The Proposed Settlement

Two years after certification, and four years after the action was commenced, the parties negotiated a settlement agreement. One major factor spurring settlement was , two of which (Society of Composers, Authors and Music Publishers of Canada v Bell Canada, and Alberta (Education) v Canadian Copyright Licensing Agency, ) dealt with the fair dealing exception in a manner which had a direct impact on the litigation.

Counsel for the affected class saw these decisions as “substantially increase[ing] the litigation risk for the Class Members” [], as the decisions of the Supreme Court provided Thomson Reuters with a broader fair dealing defence, and clarified that the for-profit nature of its Litigator service was not an insurmountable barrier against pleading fair dealing under The negotiations which followed were, in the words of the Court, “adversarial, arm’s length, and intensive.” In the end, Thomson Reuters made no admission of liability, and continues to deny the validity of Waldman’s claim.

Nevertheless, the parties were able to come to a mutually agreeable conclusion. Thomson Reuters insisted on a licence as part of the settlement, to avoid any claims in the future. Counsel for the class members proposed that Thomson Reuters fund a cy-près trust in the amount of $350,000 in lieu of direct compensation for individual plaintiffs, as specific losses were impossible to calculate.

The settlement also included mandatory copyright notices to users of the Litigator service about potential third-party copyright claims affecting the material accessible through Westlaw’s database. Class Members were permitted to opt out of the settlement, and Counsel for the plaintiffs secured $825,000 in legal fees as part of the settlement.

Fair and Reasonable: Objection to the Settlement and its Rejection by the Court

This proposed settlement was objected to by seven class members, all of whom are individual lawyers whose works appear on the Litigator service. Of these seven, five explicitly mention the disproportion between the amount awarded to the Class ($350,000) and the amount awarded to Class Counsel ($850,000).

Of the remaining two lawyers, one strongly objected to the notion that he retained any copyright in his court documents after they were filed, and objected to the suit on principle. Another objector claimed that no licence should be given to Thomson Reuters, as the settlement would therefore confer a direct benefit on the defendant (a licence) but only an indirect benefit on the plaintiffs (a fund for public interest litigation).

The Court agreed with the objecting Class Members, and rejected the settlement on the grounds that it was not fair, reasonable, and in the best interest of Class Members. In particular, Judge Perell emphasized that the paramount concern in approving a proposed class action settlement is access to justice. Moreover, the decision contains a consideration of what the phrase “access to justice” means in the context of class action settlement. In addition to substantive and procedural fairness, the Court held that a consideration of fairness in the context requires a court to consider:

circumstantial fairness, i.e., the fairness of the settlement to the parties and the class members in their particular circumstances, institutional fairness, and the fairness of the settlement from the perspective of a robust notion of access to justice that includes an outcome that objectively should satisfy the class members’ entitlement to justice for their grievances.����]

In particular, “institutional fairness” prevents a Court from “rubber stamping” settlements, to avoid setting an example through which fatigue, incompetence, opportunism, or the business model of Class Counsel or representative plaintiffs will result in a settlement which restricts the legal options of individual Class Members.

In the current settlement, the Court found it was unable to approve the settlement both because the award to Class Counsel was larger than that to Class Members, and because the settlement effectively “expropriates the Class Members’ property rights in exchange for a charitable donation from Thomson” [].

Moving Forward – Class Actions and Copyright Infringement in Canada

The decision contains valuable insight into judicial approval of class action settlements involving copyright infringement in Canada. The idea of class certification in copyright infringement actions seems at first glance to overcome some of the current barriers imposed on rights holders in asserting claims in the current legal climate – in particular the difficulty of proving individual damages, the restrictions on statutory damages imposed through recent legislative amendments, the limited means of some rights holders, and the relative power of organizations which distribute and communicate works to the public.

However, the decision in Waldman v Thomson Reuters shows that such actions have substantial public policy considerations involving access to justice. In particular, the decision shows that “access to justice” means something particular in the context of a settlement. The access to justice at issue is that afforded to members of the Class, not general projects – such as a fund for public interest litigation – which may provide access to justice for society writ large.

In addition to the concern about optics, the Court also addressed the ability of Class Members to “opt out” of the settlement agreement.  Since classes are certified in part because individual members lack the resources to pursue claims individually, the Court saw the argument that the settlement was fair because individual members could opt out as “specious.” Class action infringement suits may offer Canadian rights holders a powerful option for protecting their intellectual property, but the Ontario Superior Court has made it clear that such options must be exercised with a real concern for the Class Members whose rights are being protected.

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

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According to a recent article in , a pilot project called The Best of B.C. Books Online will endeavour to make about 1000 non-fiction titles, both new and back catalogue, available as electronic books. This will be achieved by purchasing electronic rights to non-fiction books from B.C. publishers, and making them accessible through public and school libraries. The electronic books will then be made available for free to anyone with a British Columbia library card.

The Best of B.C. Books Online will fill the electronic access void that continues to plague the public and school libraries. Postsecondary libraries across Canada, on the other hand, have had electronic access for years. Mr. Whitney, city librarian at the Vancouver Public Library, is extremely excited about this endeavour and believes that it will enable more Canadian content to be available and generate more revenue for Canadian publishers.

The Best of B.C. Books Online is run by a consortium of the , the , public libraries, K-12 schools and the . Dabbling in this emerging area of electronic books where set standards are few and far between, the consortium is currently attempting to go about purchasing rights from publishers and working with publishers to control content. Purchasing rights to titles will probably be done by paying publishers a cost that is equivalent to a certain number of copies at retail price, however the exact number that would be sufficient still needs to be determined. Whether these rights are purchased as a one-time purchase, or under an annual payment plan is still an issue that needs to be agreed upon by the libraries and publishers. If the music industry is any indication of the electronic book industry to come, controlling how content is used will prove to be difficult. Like music, what electronic book rights will allow have to be balanced between the needs of the users and the publishers. For example, when rights are purchased for a song via , the song can only be placed onto a limited number of computers. In a similar sense, the consortium is looking to enter a type of agreement that allows the user to copy a small portion of the book. However, what would define a ‘small portion’ could range from a few pages to a chapter and is something that still needs to be agreed upon. Furthermore, the issue of whether there will be a mechanism that will control this copying is unknown. Will the user be automatically restricted from copying more than the allotted amount?

If the Best of B.C. Books Online project is successful, I cannot help but wonder how it will impact public and school libraries in the future. First of all, I have always imagined public libraries as a vibrant and comforting community space with librarians who will help with research and workshops that people can attend. Will the money that is required to purchase and maintain rights to so many literary works put a strain on the resources that are required to maintain the library as a community space? Secondly, hardcopy books are generally restricted to borrowers who live within the neighborhood of the library, simply because one would not travel several hours away to borrow books at another library in another neighborhood. With the advent of electronic books that exist on a central server, there is a significant risk that user login information will be shared with individuals who do not live in British Columbia, or perhaps even individuals who live halfway across the world. Of course, one might argue that this has not yet happened in the postsecondary libraries thus far, but the difference is that postsecondary reading material is generally much more specialized and technical. Individuals who are interested in such highly specialized material will have access through their own academic institution and those who are simply interested for knowledge-sake are few and far between. Public libraries on the other hand carry material that is much more general and readable to the public at large. As such, there is a significant chance that the remote electronic access to books may be abused by a much larger number of individuals. 

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