Canadian Copyright 2019 Year Update

Welcome to the roaring 20s 2.0! Midway through 2019, we discussed decisions that had been rendered in our mid-year update, and highlighted appeals we were eagerly anticipating being heard. 2019 was an interesting year for changes to the copyright landscape in Canada, with more to come in 2020!

1) COPYRIGHT LEGISLATION

(a) USCMA

Chapter 20 of United States – Mexico – Canada Agreement (“USMCA”) provides for several changes relating to intellectual property and digital media, including an extension to the term of copyright protection to life of the author plus 70 years. These changes must be implemented into the parties’ respective domestic laws within prescribed transition periods after the USMCA comes into force. For Canadian authors, this means that the life of the copyright in their works will have an additional 20 years for the owners of copyright to control the exploitation of their work and derive benefit therefrom. Canada has 2.5 years from the date upon which the USMCA enters into force to enact the changes, so until then, the life of copyright remains 50 years from the end of the year in which the last living author dies. We expect that Canada’s general copyright term will be extended by fall 2022. Stay tuned!

In the meantime, Bill C-4—An Act to implement the Agreement between Canada, the United States of America and the United Mexican States—had its first reading in the House of Commons on January 29, 2020. It remains largely the same as its predecessor Bill C-100 from May 2019, but there are changes that include new criminal sanctions regarding trade secrets, as well as some to the copyright term in the cases of anonymous/pseudonym works and anonymous/pseudonym works of joint authorship. The term has now been extended to the earlier of the end of 75 years following the end of the calendar year in which the first publication occurs and 100 years following the end of the calendar year in which the work was made. However, no change was made to the existing general copyright term of life plus 50 years. The proposed amendments can be found here.

 (b) Standing Committee Report: The Industry, Technology AND Science Standing Committee (“INDU”) Statutory Review of the Copyright Act

We reported on the Industry, Technology and Science Standing Committee (“INDU”)’s recommendations in mid-2019, and it remains to be seen whether any of the following will be implemented in a further amendment to the Copyright Act:

• Consider making copyright registration a requirement to enforce copyright in a work during the additional 20 years to be provided by the planned extension of the general term of copyright from the life of the author plus 50 years to life plus 70;
• Provide a non-assignable right to terminate an assignment of copyright 25 years after the date of assignment, subject to (i) registration of the copyright, (ii) five years notice of intent to exercise the right, and (iii) exercising the right within five years after it becomes available;
• Amend the Act to provide that an exercise of the reversionary right under section 14(1) may not take effect earlier than 10 years after a notice of intent to exercise the right;
• Consider implementing an artist’s resale right;
• Update the rules governing first ownership and authorship of cinematographic works to better respond to different types of industries and productions, and maintain Canada’s competitiveness in a global market;
• Provide clarity around ownership of computer-generated works (e.g. works created with the assistance of artificial intelligence (AI));
• Introduce an exception to copyright to facilitate the use of lawfully acquired copyright protected works and other subject matter for informational analysis;
• Amend section 29 of the Act to provide that the list of allowable fair dealing purposes is illustrative, as opposed to exhaustive;
• Provide regulations to standardize notices of claimed infringement under the notice-and-notice regime to be in a prescribed, machine readable format; and
• Update the maximum and minimum statutory damages awards provided under the Act, and provide a mechanism to periodically increase these amounts to reflect inflation.

For further discussion, please read our mid-year article regarding the legislative and policy changes.

  (c) Standing Committee Report: The Standing Committee on Canadian Heritage (“CHPC”) Statutory Review of the Copyright Act: “Shifting Paradigms”

The CHPC conducted its own review of the Copyright Act and those creative industries principally affected, including the music, film & television, writing & publishing and visual arts industry. The major themes covered were: (1) the increasing value gap between creatives, distributors and others; (2) the decline in the artistic middle class; (3) the impact of technology on creative industries; (4) the changes in consumer culture; and (5) indigenous perspectives on copyright. The CHPC came to the following recommendations:

• That the Government of Canada increase its support for creators and creative industries in adapting to new digital markets.
• That the Government of Canada develop mechanisms by which streaming services will develop and promote Canadian content.
• That the Government of Canada create educational materials to raise awareness of copyright provisions and artist remuneration for consumers.
• That the Government of Canada create educational materials to raise awareness of copyright provisions as well as artists’ rights and responsibilities under the Copyright Act for artists and creators.
• That the Government of Canada review the safe harbour exceptions and laws to ensure that Internet service providers are accountable for their role in the distribution of content.
• That the Government of Canada increase its efforts to combat piracy and enforce copyright.
• That the Government of Canada pursue its commitment to implement the extension of copyright from 50 to 70 years after the author’s death.
• That music streaming services be regulated like other Canadian music services.
• That tariffs for online music services be reviewed by the Copyright Board to ensure royalty payments provide fair compensation for artists.
• That the Government of Canada amend the radio royalty exemption found at section 68.1(1) of the Copyright Act so that it applies only to independent and/or community-based radio stations.
• That the Government of Canada amend the definition of sound recording found in section 2 of the Copyright Act to allow sound recordings used in television and film to be eligible for public performance remuneration.
• That the Government of Canada review, clarify and/or remove exceptions contained in the Copyright Act, ensuring that any exception respects section 9 of the Berne Convention for the Protection of Literary and Artistic Works, to which Canada is a signatory.
• That the Government of Canada meet international treaty obligations (including Berne Convention for the Protection of Literary and Artistic Works, the Trade-Related Aspects of Intellectual Property Rights Agreement, and World Intellectual Property Organization Copyright Treaty).
• That the Government of Canada amend subsection 14(1) of the Copyright Act so that it reads “from 25 years after assignment.”.
• That the exception for charitable organizations in subsection 32.2(3) of the Copyright Act be clarified to apply strictly to activities where no commercial monetary gain is intended.
• That the Government of Canada extend moral and economic rights to audiovisual performers.
• That the Government of Canada amend section 34.1 of the Copyright Act to deem the screenwriter and director the co-owners of copyright and co-authors of a television or cinematographic work.
• That Government of Canada amend the Act to clarify that fair dealing should not apply to educational institutions when the work is commercially available.
• That the Government of Canada promote a return to licensing through collective societies.
• That the Government of Canada review, harmonize and improve the enforcement of the statutory damages for infringement for non-commercial use in section 38.1(1) of the Copyright Act.
• That the Government of Canada harmonize remedies for collective societies under the Copyright Act.
• That the Government of Canada establish an artist’s resale right.

For a full discussion on the issues, a copy of the report can be accessed here.

2) COPYRIGHT JURISPRUDENCE

(a) Scope of Copyright Protection

(i) Facts and information

In the Manitoba decision, Albo v. The Winnipeg Free Press et al., 2019 MBQB 34, the Court has once again clarified that copyright does not extend to facts and ideas, but only protects expressions. The decision reiterates that copyright protection in Canada is assessed on the basis of originality and an author’s skill and judgment, and not the “sweat of the brow” standard.

The plaintiff, Dr. Frank Albo, had a prior working relationship with the defendant newspaper, the Winnipeg Free Press. The parties had collaborated on a series of articles about the history of Winnipeg that were later published as a book. Dr. Albo then agreed to consult for research on a new series of articles, to be written by a staff writer at The Press. The articles were expressly not intended for book publication (as the previous book had resulted in a loss for The Press). However, after the new series of articles was released, The Press was approached by a third party with a cost-sharing proposal to publish the articles as a coffee table book (the “New Book”), which made the project viable. The Press accepted the proposal and the New Book was published, and subsequently Dr. Albo suggested that he was not adequately compensated for his contributions. After some correspondence, Dr. Albo initiated a claim for copyright infringement and breach of contract, stating that the New Book reproduced a substantial part of Dr. Albo’s research (as expressed in various public lectures, presentations, remarks/interviews), and that this was outside the scope of his consulting agreement with The Press.

The Court dismissed both claims.

The Court conducted a close comparison of Dr. Albo’s works and the New Book and concluded that they “do not share any features or combination of features to support a conclusion that the [New] Book is even a non-literal copy of any material in which Dr. Albo can claim copyright.” The Court observed that copyright protection does not extend to research of historical facts, but instead protects an author’s specific expressions of such information; although Dr. Albo might have copyright in certain compilations of the products of his research, this did not allow him to control the use of any particular historical facts included in his research compilations. Additionally, while Dr. Albo might have participated in certain discussions that gave rise to protectable elements of the New Book, such as the title, the evidence before the Court did not provide a sufficient basis for any conclusions on the authorship of those elements. The Court further held that certain mathematical calculations by Dr. Albo amounted to a “purely mechanical exercise” that did not meet the originality requirement under copyright law. Finally, in the alternative the Court considered whether the New Book could be a fair dealing with Dr. Albo’s copyright protectable works, and concluded that the various fairness factors weighed towards a finding that the New Book fairly dealt with Dr. Albo’s works.

On appeal to the Manitoba Court of Appeal, the Court dismissed Dr. Aldo’s appeal, finding that the judge made no palpable and overriding error in deciding that the defendant acted in good faith in performing the contract.

(ii) Moral Rights

In Carpentier c. Fabricville Co. Inc., 2019 QCCQ 1515, Julie Carpentier brought a copyright infringement claim in Small Claims Court for $13,633.66 in damages for Fabricville’s unauthorized use of her drawing. Ms. Carpentier reproduced her drawing on fabric that she sold commercially, and she claimed that Fabricville made a minor alteration to the drawing and reproduced it on fabric sold in its stores. Fabricville put evidence before the Court from its Chinese supplier contending that the drawing was authored in January 2012 and been sold since that time. The Court found no other corroborating evidence and rejected Fabricville’s defence, finding in favour of Ms. Carpentier’s copyright having been infringed. The Court awarded her $1,329.75 in damages for the infringement of her copyright and $2,750 for infringement of her moral rights.

(b) Crown copyright

In Keatley Surveying Ltd. v. Teranet Inc., 2019 SCC 43, a seven judge panel of the Court unanimously held that the copyright ownership of plans of survey registered or deposited in Ontario’s provincial land registry and thereafter published, by virtue of that publication, vested in the Crown (i.e., the government) under section 12 of the Copyright Act, RSC 1985 c C-42. Section 12 of that Act provides that copyright in any work “prepared or published by or under the direction or control” of the government belongs to the government, subject to any agreement with the author. 

The decision in Keatley stems from a class action lawsuit proposed by land surveyors in Ontario against Teranet, an Ontario corporation who manages the Ontario electronic land registry system as part of a “public-private” partnership with the province. Ontario claims ownership in the data included in its electronic land registry system, and licenses Teranet to access registry documents to facilitate that system, including plans of survey. Under this license, Teranet provides electronic copies of land surveys to the public for a fee without paying royalties to the surveyors. These land surveys are typically created in hard copy, before being deposited and registered with the land registry office, at which point, they are scanned and uploaded to the electronic system by Teranet. Keatley, the proposed lead plaintiff for the class, claimed this digitization, storage, and copying of plans infringed land surveyors’ copyright.

Ontario claimed control or ownership of the surveys under section 12 of the Copyright Act. The deposit and registration of plans of survey are governed by various provincial statues, including the Registry Act and the Land Titles Act. This latter statute provides that all plans submitted for deposit and registration become Crown property. Both statutes prohibit registration of plans containing any copyright mark. Once deposited, the surveyor who created the plan is prohibited from amending its content without permission from the Examiner of Surveys, who is appointed by the Crown.

Determining ownership is a fact-specific inquiry. All sources of rights and obligations must be examined to determine who owns the copyright in question: the Crown or the Crown-affiliate. The Supreme Court established a test to determine if Crown copyright arises under section 12: has the Crown exercised sufficient direction or control, consistent with the purposes of Crown copyright, that it can be said that Crown copyright subsist. (Para. 63 of the decision). To assess this, examination was required of the level of the Crown’s control over both (1) the person preparing or publishing the work; and (2) the work itself.

A work “prepared” by the Crown could fall into two categories. The first is an agent or servant of the Crown brings the work into existence for and on behalf of the Crown (i.e., an agent or employee). The second is “works produced by independent contractors who complete Crown commissions in which the Crown exercises the direction or control over the creation of the work”. (Para. 65). While the Supreme Court was careful to note the “direction or control” needed to go beyond simply laying down formal requirements for how a work should be made, they agreed that if the production of the work was the principle object, then Crown copyright would arise and that it extended to “independent contractors”. This second category could thus have significant ramifications, particularly for artists or other creators, who compete for or accept government commissions.

On the “publication” side—which was the issue relevant to the appeal—the majority noted the “direction and control” by the Crown needed to be something more than simply “making the work available” to the public to mitigate the risk of overly broad application of section 12. They set out the standard that Crown copyright will arise “when it can be said that the Crown exercises direction or control over the publication process, including both the person publishing the work and the nature, form and content of the final, published version” (Para. 67). Abella J. lists the following factors indicative of control: whether a statute strictly regulates the form and content of the work; whether the statute transferred "property rights" in the works to the Crown; whether the statute gives exclusive control to the government to modify the work; or whether the Crown took physical possession of the work. In Keatley, there were extensive property-related rights bestowed on the Crown by the land registration scheme in Ontario which compels the conclusion that the publishing of those plans, by making copies of the plans available to the public, is done under the "direction or control of Her Majesty." This control, in turn, gives rise to section 12 of the Copyright Act, which declares that the copyright in the registered or deposited plans of survey belongs to the Crown.

The Keatley decision has important ramifications, particularly as governments increasingly shift to and rely on public-private partnerships to operate and provide services. Furthermore, the decision may open the door to a wider application of Crown copyright in Canada. Practically, those that work with or for Canadian government bodies, or otherwise create or publish works with government involvement, would be well advised to seek legal advice to help them understand Crown copyright.  

A deeper discussion of the decision can be found here in an article published by Bereskin & Parr LLP.

(c) Don’t You Forget About the Copyright in that Trademark

In Bereskin & Parr LLP’s July 17, 2019 article, © that ™! Why it’s Important to Confirm You Own Copyright in Your Logo, we discussed how the Trademarks Opposition Board’s decision in Pablo Enterprise pte. Ltd. v Hai Lun Tang, 2019 TMOB 54, which demonstrates that a copyright claim can be successfully relied on by an opponent of a proposed trademark for the denial of the mark’s registration where it can prove it is the copyright owner of an applied-for logo, or that use of the logo would, prima facie, infringe the opponent’s copyright.

In this case, the Hearing Officer found that Pablo Enterprise’s evidence supported a prima facie case of copyright infringement, and that the Applicant provided no evidence to counter this conclusion. In particular, the date or first publication claimed in the Certified Copyright Registration, which was 2011, predated the application filing date by four years. This date was supported by printouts of archived versions of the Opponent’s website that displayed the artistic work from around that time. Based on the principle that copyright protection arises on the creation of the work (i.e., registration is not necessary), the Hearing Officer concluded that copyright protection in the work would have arisen before the 2015 filing date of the trademark application — even though the copyright registration was not obtained until afterward. Moreover, the applied-for mark was found to be a “substantial copy” of the artistic work, being comprised of the identical design component, and the same font being applied to the same word “PABLO” (even though it was positioned somewhat differently).

The decision suggests that, before filing a trademark application for a logo, the trademark owner should confirm it owns copyright in the logo, and may wish to consider registering copyright in Canada in the logo as an artistic work. The process to secure a copyright registration in Canada is straightforward and relatively inexpensive. Unless proved otherwise, the information in a Canadian copyright registration is presumed to be true. It can therefore assist with thwarting (or supporting) claims of copyright infringement in an opposition proceeding.

 This is particularly important given that copyright ownership is treated differently in Canada compared to certain other jurisdictions, like the United States. Canada does not have a “work for hire doctrine”, nor does it recognize that a corporation could be considered the “author” of a work. In Canada, as noted, copyright ownership is first deemed to vest in its author, with a limited exception for works created by an employee in the normal course of their employment. Consequently, when an artist or graphic designer has been hired to design a logo that will be used as a trademark, prospective Canadian trademark applicants would be well advised to have a written copyright assignment from the artist to the applicant before filing the trademark application, to avoid any claims by the artist against trademark registration in the future.

(d) AI & Copyright

The U.S. Patent and Trademark Office is seeking comments on what the impact would be on providing copyright protection to works created using artificial intelligence, or AI-created works. Some questions being considered include:

• what level of human involvement is required for copyright protection?;
• how does fair use apply in a world where AI can create works faster and in greater quantities than humans can?; and 
• what if AI infringes copyright?

In Canada, as indicated above, INDU and the Canadian government led a review of the Copyright Act, and on June 3, 2019, INDU released its report on the statutory review of the Act, setting out 36 policy recommendations, including providing clarity around ownership of computer-generated works (e.g. works created with the assistance of artificial intelligence (AI)). There are many interesting ethical and legal considerations to be weighed in the decision of whether or not to extend copyright protection to AI-created works. Much more remains to be studied, including issues surrounding:

• authorship; 
• originality and infringement when it comes to AI being used in the creation of works;
• exceptions for text and data mining; and
• to what extent data and databases should be protected and whether Canada should consider sui generis protection for databases or AI created works. 

It will be interesting to see how the Canadian government approaches the issues. Stay tuned for updates from Bereskin & Parr LLP on this matter.

(e) Rules of Civil Procedure

In Sullivan v. Northwood Media Inc., 2019 ONSC 9, the Court for the first time since the 2019 amendment to the Ontario Rules of Civil Procedure, imposed elements of a discovery plan in a copyright action relating to Netflix’s “Anne with an ‘E’” television program (the action alleges infringement of Sullivan Entertainment’s rights in its iconic Anne of Green Gables works). After canvassing the issues in the proceeding, including the requirements to prove copyright infringement, D. E. Short, the Case Management Master assigned to the case, noted that one of the problems with the Rules amendment is that it is unclear how a party challenges the Court’s ruling if unsatisfied with it. A deeper discussion can be found here.

(f) Infringement

(i) Substantial similarity, methods and techniques

In Pyrrha Design Inc. v. Plum and Posey Inc., 2019 FC 129, one jewelry designer claimed that its copyright in wax seal jewelry designs had been infringed by another designer. Although the Federal Court recognized the plaintiff’s copyright in their works, the Court dismissed the claim because the defendant’s works did not infringe the plaintiff’s skill and judgment in preparing their original jewelry.

When assessing whether copyright has been infringed, Canadian courts may look to whether a “substantial part” of the author’s skill and judgment in creating the prior work has been reproduced as part of the subsequent work. In Pyrrha, the Court noted that both parties had used a common casting method to create wax seal jewelry and had used separate imagery from pre-existing wax seal impressions available in the public domain to create their respective jewelry works, observing that copyright law does not protect ideas or techniques. While the Court acknowledged that the defendant had prior access to most of the plaintiff’s designs, the Court noted that, at most, access served as a potential inspiration for the defendants to create their own jewelry pieces based on the plaintiff’s use of imagery and techniques in the public domain.

The Court held that the similarities between the works did not amount to the reproduction of a substantial part of the plaintiff’s works, as the use of common techniques and public domain imagery does not form a part of an author’s skill and judgment in preparing an original jewelry work. Consequently, the Court gave “little weight” to these non-original elements of the jewelry in the substantial part analysis, and held that the plaintiff’s copyright in their original jewelry pieces had not been infringed.

Pyrrha is expected to go