Copyright – 2017 Year in Review

April 4, 2018
By Jill Jarvis-Tonus, Catherine Lovrics, Max Rothschild, and Tamara Céline Winegust

In this article, we summarize our top picks of copyright decisions from the past year, including decisions that address:

  • fair dealing, and, in particular, the user right to parody, the ‘fairness’ of bright line thresholds in fair dealing guidelines of educational institutions, and ‘tributes’
  • what online services qualify for the information location tool exemption
  • protection for technological protection measures, and remedies for circumvention
  • independent creation
  • copyright in data and databases
  • statutory damages for copyright infringement and circumvention of technological protection measures
  • preliminary injunctions in copyright cases, and
  • decisions relating to the Copyright Board of Canada, and submissions on reform to the Board's powers and procedures.

Fair Dealing

Fair dealing is an integral part of the Copyright Act, and allows users to engage in some activities that might otherwise amount to copyright infringement. Fair dealing is understood as a user right in Canada, rather than simply a defence. 

There were several important developments in the law of fair dealing in 2017. The long-awaited decision looking at York University’s Fair Dealing Guidelines calls into question the ‘fairness’ of bright line thresholds in fair dealing guidelines for educational institutions (e.g. 10% or less of a work). Additionally, the first Canadian case to interpret fair dealing for parody indicates that this user right may be quite narrow. Below we discuss these and a few other fair dealing decisions of note. 

It is helpful to keep in mind that Canadian courts take a two-step approach to determine fair dealing. First, the dealing must be for an allowable purpose. Historically, these purposes were research, private, news reporting, review and criticism, and in 2012 this list was expanded to include education, parody and satire. Second, the dealing must be ‘fair’ in the surrounding circumstances. Courts will consider ‘fairness’ factors, including the purpose, character and amount of the dealing, the nature of the underlying work, the effect of the dealing on the underlying work, and alternatives to the dealing.

Fair Dealing Guidelines

In Canadian Copyright Licensing Agency v. York University (2017 FC 669), York University pointed to its Fair Dealing Guidelines to argue that staff who followed the Guidelines were fairly dealing when making copies of copyright protected works. The Guidelines set out that “short excerpts” could be copied, and defined such excerpts as being no more than the greater of either (1) 10% or less of a work; or (2) certain other set thresholds (e.g. one chapter from a book, a single article from a periodical, etc.). The Guidelines also included a caveat that no more of the work should be taken than required to achieve the fair dealing purpose. The Association of Universities and Colleges of Canada (“AUCC”) had drafted Fair Dealing Guidelines upon which York and other educational institutions based their Guidelines

Even though the dealings were for education, research or private study purposes, they were found not to be ‘fair’. The Court considered the Guidelines in light of the various fairness factors, and its decision turned on the amount of the dealing. The Court found the fixed thresholds in York’s Guidelines arbitrary and not soundly based in principle, essentially because the University could not explain why such thresholds were set or why they were “presumptively fair.” The University and the AUCC’s failure to justify the thresholds was seen by the Court to seriously undermine the overall fairness of the Guidelines. The Court noted that under the Guidelines different amounts of the same work could be copied depending on the source. As an example, the Court pointed to a Canadian children’s story, The Hockey Sweater, which it found “could be copied freely if it appeared in an anthology, but would [be limited] if copied on its own.” In coming to this conclusion, the Court did not appear to have given weight to the caveat and resulting discretion to staff.

The Court also considered the aggregate volume of copying by York, as well as by all post-secondary institutions, that could be allowed if the Guidelines or similar policies were widely adopted. This focus on the aggregate amount of copying, rather than on the individual use, is curious in view of the Supreme Court of Canada’s position in Society of Composers, Authors and Music Publishers of Canada v. Bell Canada (2012 SCC 36) that “aggregate” assessments are properly considered as relevant to the “character”, not the “amount”, of the dealing. In SOCAN, the SCC had cautioned against focusing on the “aggregate” to assess the “amount of the dealing” since this approach could run the risk of disproportionate findings of unfairness. The Court in York may have balanced its divergence from SOCAN by recognizing that while the copying in York occurred on an institutional scale, such institutional copying was not “inherently less fair” as compared to situational or spontaneous copying.

York has appealed to the Federal Court of Appeal. This case will be closely watched by educational institutions, as well as all copyright users, to see whether there may be judicial guidance on whether it is possible to set presumptively fair threshold amounts for fair dealing.

Another case in this area to watch will be Société québécoise de gestion collective des droits de reproduction (Copibec) c. Université Laval, which saw two major decisions in 2017. First, the Quebec Court of Appeal certified a proposed class action against the University, overturning a lower court’s decision to deny certification (2017 QCCS 199). Subsequently, the Quebec Superior Court denied Laval’s request for a stay of the proceedings pending the outcome of the appeal in the York University case discussed above (2017 QCCS 5417). Laval had pled that its copying policies were essentially the same as York’s, and that the Federal Court of Appeal’s decision in York would have a direct impact on the proceedings. The Quebec Superior Court disagreed, noting that Justice Phelan’s decision in York grounded its assessment of fairness in the specific facts of the case, and, without proof from Laval, it could not be taken as a given that Laval’s and York’s respective guidelines were the same. As a result, the interests of justice required that the matter proceed concurrently with the York appeal. It will be interesting to see if there will be a split in the law as a result of the Laval and York cases proceedings in parallel.


2017 also saw the first decision to consider fair dealing for “parody”, namely United Airlines, Inc. v. Jeremy Cooperstock (2017 FC 616). The decision suggests that fair dealing for parody may be quite limited, and that this user right falls short of enabling consumer groups to criticize companies and brands using those businesses’ intellectual property. Generally, if followed, the decision suggests that parodies that are too unflattering, critical or disparaging are unlikely to be ‘fair’. The decision has been celebrated by brand owners as striking the right balance between permitting consumers to voice criticisms and protecting IP, by drawing a line and making it an infringement to use copyright protected assets, including branding, to deliver a disparaging message. On the other hand, the decision has been criticized by others that suggest it puts consumer and other advocacy groups on unfair footing. 

Since 1997, the defendant individual had operated a consumer criticism website at, providing information and complaints about United Airlines. In recent years, the defendant had added a logo resembling that of United Airlines, begun tracking with official website updates by United, and had generally updated the complaint website to conform with the appearance of the United website. Before initiating legal proceedings, United had demanded that the defendant make changes to the impugned website and add a disclaimer to state that it did not belong to United Airlines.

The Federal Court found the website qualified for the allowable purpose of “parody”. It interpreted “parody” as having two basic elements: (1) the evocation of an existing work while exhibiting notable differences and (2) the expression of mockery or humour. The Court declined to introduce a requirement that parody must comment, at least in part, on the underlying work, which is part of the US fair use test for parody. Both parody and satire are allowable fair dealing purposes in Canada. By contrast, in the US satire is not allowable, and the difference between parody and satire turns largely on whether the new work comments on the underlying work or something completely unrelated. It will be interesting to see how Canadian courts distinguish between satire and parody. The United Airlines decision suggests that a requirement to comment on the underlying works is not the key difference at law in Canada. 

Although the defendant’s “Untied” website and logo parodied the United Airlines website and logo, the Court found the dealings were not ‘fair’. When assessing the fairness factors, the Court reached its decision primarily because the dealing was unflattering. As a result, the user right may be limited to humorous parody that is not too critical or mocking. 

The decision also turned significantly on the degree to which the defendant’s website was confusing with United’s, effectively importing the trademark aspects of the decision into certain portions of the fairness analysis. This aspect of the United decision may ultimately be problematic since “confusion” is not a proper gauge of copyright infringement.

Reading the decision in United with the Federal Court’s decision in Cie générale des établissements Michelin-Michelin & Cie v. CAW – Canada ([1996] F.C.J. No. 1685), consumer groups, unions or other activist organizations may not have a ‘user right’ to disparage or criticize a company by using the company’s copyright-protected works (such as logos). Michelin involved a workers union that used trademark and copyright protected materials owned by the Michelin tire manufacturer to criticize that company’s labour practices. The union claimed it fair dealing for criticism, and claimed ‘parody’ was a form of criticism. The Federal Court in Michelin found the use did not qualify as ‘criticism’ and, even if the dealing was for an allowable purpose, it was not ‘fair’ because it did not treat the copyright in a fair manner, including that it held the work up to ridicule. Michelin was decided before fair dealing for parody was introduced, and also before the ‘fairness’ factors were expounded upon by the Supreme Court of Canada in CCH Canadian Ltd v Law Society of Upper Canada (2004 SCC 13). It will be interesting to see whether the Federal Court’s approach in Michelin will be revisited in view of the United decision.

United may be a case to watch in 2018 as it is currently before the Federal Court of Appeal.

Tribute, not an allowable purpose

The Quebec decision of Labelle c. Brilliant (2017 QCCQ 12285) also serves as a reminder that fair dealing in Canada is limited to the allowable purposes of research, private study, education, parody or satire, criticism, review and news reporting. In this matter before the Quebec Small Claims Court, the defendant singer-songwriter, Mr. Brillant, had released a track titled “Chérie ma pitoune” as a tribute to an old song they recalled hearing in their childhood. The issue was that the plaintiff songwriter, Mr. Labelle, who had composed the song the defendant recalled, claimed the new track was essentially the same as the original song from the 1990s. The Court found the similarity between the two works striking, and found infringement. The defendant’s claim of fair dealing was denied, in part, because the defendant did not prove “paying tribute” to the original song fit within any of the claimed fair dealing purposes. 

Unfair commercial reproduction of the essence of a work

The Quebec Superior Court also weighed in on fair dealing with the decision in Cedrom-SNI inc. c. Dose Pro inc. (2017 QCCS 3383), concerning Dose, a media monitoring aggregator service that reproduced the headlines and first paragraphs of articles from three Quebec newspapers. Dose operated both an ad-funded free service and a premium service without ads. The three newspapers and Cedrom (an authorized aggregator) sought an interlocutory injunction, alleging Dose infringed the newspapers’ copyrights in articles. The Court held that the headline and first paragraph were an important, substantial part of each article. They provide a hook for the reader, and distill the essence of the article. Dose was not fairly dealing with these elements for a number of reasons: Dose’s purpose was clearly commercial; evidence showed that Dose’s dealing decreased readership of the newspapers, and the effect of a drop in readership was counter to the nature of the works since newspaper articles are intended to be widely disseminated. Further, the multiple copies being made also weighed against fairness. Ultimately Dose was unable to justify its use of the plaintiffs’ copyright protected works, and the injunction was granted.

Independent Creation

In Stork Market Inc v. 1736735 Ontario Inc (2017 FC 779), the Federal Court dismissed the plaintiff’s claim for copyright infringement, while allowing related trademark infringement claims. Both the plaintiff and the defendant ran businesses renting out and installing lawn signs to commemorate special occasions. In this case, the issue pertained to signs announcing the birth of a child. Both parties rented out large signs that featured a stork with its arms raised above its head to ho
ld up a banner or flag stating the gender of the newborn child, and included an image of a child. The plaintiff had commissioned its designs in 2007 and registered trademarks in the images in 2009, and then in 2012 (shortly after the commencement of the lawsuit) the plaintiff had entered into a written agreement with the artist (a friend of the plaintiff) that assigned all copyright in the images and waived any moral rights. By contrast, the defendant had begun using its stork-images in 2010, and continued to do so after receiving a cease-and-desist from the plaintiff in 2011.

The Court noted prior case law finding that “evidence of independent creation or use of a common source will serve to establish non-infringement.” The defendant had shown that its images were designed with a particular objective in mind that differed from that of the plaintiff’s images. Specifically, the defendant had designed its image to show a fully-clothed baby whose clothes could be customized (e.g. to be wearing a tiara or a baseball cap, at the client’s election), unlike the swaddled baby shown in all of the plaintiff’s signs. This resulted in somewhat different design choices than those demonstrated in the plaintiff’s images. Consequently, the Court did not find the similarities between the parties’ images to be so substantial as to reject the defendant’s evidence of independent creation, or to support a finding of copyright infringement.

Information location tools: Search engines vs. aggregators

The Ontario Superior Court’s decision in Trader v. CarGurus (2017 ONSC 1841) is the first Canadian case to interpret the ‘information location tools’ exemption under section 41.27 of the Act. The decision suggests that aggregators may be less likely to qualify as information location tools, as compared to, for example, search engines that link to information and content available through the Internet. 

CarGurus operates a search engine for the purchase and sale of new and used vehicles. As part of its search engine, CarGurus at one time indexed data from other websites (also known as “scraping” or “crawling”), and obtained data from other sources. CarGurus initially operated in the United States and then entered the Canadian market in 2015. CarGurus implemented practices similar to those used for its U.S. website. The plaintiff in this matter took issue with CarGurus’ indexing practices.

This decision suggests that linking to the original location of information may be a key element to qualify as an information location tool. The defendant CarGurus claimed that its website was an “information location tool” and its activities benefited from the exception for copyright infringement liability for “information location tools” set out in section 41.27 of the Copyright Act. The Court considered (a) the requirements for the exemption under section 41.27; (b) the background document to the Copyright Modernization Act, and (c) the intention of Parliament for these types of protections to apply where the internet service provider of search engine acts “strictly as [an] intermediary in communication, caching, and hosting activities.” The Court found the crux of the definition of “information location tool” is the locating of information – i.e. a tool that “makes it possible to locate information that is available through the Internet.” While CarGurus may have located information about a vehicle and provided it to the user through the CarGurus website, it did not enable the user to find this information where it was located on the Internet (i.e. the original dealer’s webpage for that vehicle listing). Since CarGurus’ model resulted in it acting as a liaison between the user and the original dealer, the Court found it was not strictly an “intermediary”. Based on this decision, tools that enable users to navigate and find information where it is located on the Internet are more likely to qualify as information location tools, while services that gather information from the Internet and make it available on their own website alone may not. It is worth noting that copyright owners are not entitled to claim any remedy other than an injunction against a service that avails itself of the information location tool exemption (provided certain conditions are met).

Copyright in data & databases

The past year also brought important decisions for copyright protection for databases as compilations, as well as in data itself.

In Geophysical Service Incorporated v EnCana Corporation (2017 ABCA 125) the Alberta Court of Appeal upheld the Alberta Court of Queen’s Bench’s earlier decision (2016 ABQB 230) that copyright subsists in seismic data, as well as in the compilation of such data. Although specific to the facts of the case, the finding of copyright in both raw and processed data is significant, since copyright is generally considered to protect expressions and compilations of data, but not the data itself. In the age of big data, this decision is noteworthy. 

Geophysical Service Incorporated (GSI) conducted offshore seismic surveys to be licensed to oil and gas companies, and which were provided to a number of energy boards in accordance with legislative requirements. GSI took issue with the energy boards making copies of the surveys publicly available after a confidentiality period (dictated by statute), and brought action against the boards for copyright infringement. A key issue was whether GSI’s seismic data, in either its raw or processed forms, constituted a protectable “work” under the Act. GSI argued that its raw data was original because it was created through the exercise of human skill and judgment with the aid of computers. Moreover, GSI also claimed copyright in “seismic sections,” graphical representations of processed data that could be displayed and interpreted by professional geophysicists. The defendant energy boards, meanwhile, argued that the raw data was created by computer programs that amounted to a purely mechanical exercise, and, hence, was not original or protectable under the Act.

In 2016, the Alberta Court of Queen’s Bench sided with GSI and found that copyright subsisted in both the raw data and the processed seismic sections. The Court held that the seismic sections were comparable to a map or chart, involving selection or arrangement of the underlying data. Additionally, the human processors of the data exercised skill and judgment in creating a useable product from the raw data. As for the raw data itself, the Court found that the seismic crew demonstrated skill and judgment in preparing the devices that collected the data, by selecting the proper location, angles, positioning, etc. for the instruments. The human seismic crew members were held to create the raw data, similarly to how photographers create photographs. The raw data was hence found to be an original literary work, and the processed data was both an original literary compilation and also an artistic compilation work. In any case, all forms of the data were protected by copyright.

Although GSI won on its claims for copyright, it was not successful in its claims as to the regulatory regime that empowered the energy boards. The Court held that Parliament’s specific intentions under the Canada Petroleum Resources Act (“CPRA”) supplanted the more general rights conveyed under the Copyright Act to the extent that the two statutes overlap. In GSI’s case, the CPRA empowered the energy boards to publicly disclose GSI’s data and seismic charts after the expiration of a confidentiality period. Although GSI was found to have copyright in its works, the energy boards did not infringe that copyright by acting in accordance with the CPRA. The Court observed that the CPRA applied to the extent it conflicted with the Act, and effectively set up a compulsory licence for GSI’s data to be released and used by the public, in perpetuity after the expiry of the confidentiality period.

Most of the intellectual heavy lifting in Geophysical happened in the 2016 trial decision, and it is worth noting that the lower court’s findings that copyright subsisted in the data and seismic sections were not appealed and, therefore the appeals court did not review these issues. However, 2017 saw two important developments at the appellate level in this case. In April 2017 the Alberta Court of Appeal confirmed the lower court’s decision that the CPRA created an exception to GSI’s exclusive rights under the Copyright Act to control, license, and charge a fee for dissemination or copying of the data/seismic sections. Finally, GSI then applied for leave to appeal to the Supreme Court of Canada but in November 2017 the SCC denied such leave .

While Geophysical encourages investment in the information economy by signalling that copyright may protect investment data and databases, the Federal Court of Appeal’s decision in Toronto Real Estate Board v. Commissioner of Competition (2017 FCA 236) stands in discouraging contrast. The Federal Court of Appeal denied that copyright subsisted in TREB’s Multiple Listing Service® database because there was insufficient skill and judgment to give rise to it being an original compilation work. Last year we cited the Competition Tribunal’s earlier decision on the matter (2016 CACT 7) as a potential case to watch in 2017 precisely for its appeal on this issue of originality in the creation of databases. Specifically, the Tribunal had found that the MLS® database amounted to a collection of factual information, assembled by REALTOR® agents and entered into the database in a mechanical fashion. On review, the Federal Court of Appeal found that the Tribunal had not applied the correct test for originality from CCH Canadian Ltd. v. Law Society of Upper Canada (2004 SCC 13), but had instead applied the out-of-date decision in Tele-Direct (Publications) Inc. v. American Business Information, Inc. ([1998] 2 FCR 22). However, the error was found to be of no consequence. The Federal Court of Appeal reached the same result after applying the appropriate test, noting “the process of data entry and its ‘almost instantaneous’ appearance in the database.” If the Federal Court of Appeal’s decision stands, copyright in electronic databases may be threatened, and courts may avoid a technologically neutral approach to assessing whether copyright subsists. TREB has sought leave to appeal to the Supreme Court. If leave is granted, the case may be one to watch not only for copyright protection of databases, but also for Supreme Court guidance on the intersection of copyright and competition laws.

Authorship of software 

In Gemstone Travel Management Systems Inc. v. Andrews (2017 FC 463), the sole issue before the Court was whether to expunge the defendant Andrews’ registrations from the Copyright Register. The case was “to a large extent a continuation” of Andrews v. McHale (2016 FC 624), which involved a dispute between a company and Andrews, who had formerly been both an employee and contractor of the company, and who claimed to have co-authored software developed by the company. In the 2016 decision, the Federal Court examined Andrews’ claimed contributions to the software including: creation of industry-specific content, solving data importation issues, development of a seat map, creation of systems, and development of algorithms to align data from separate functions of the software.

Based on scant evidence, the Court held that none of Andrews’ claims could be shown to “represent an exercise of skill and judgment of the type necessary to make Mr. Andrews an author,” and determined that his contributions “fall into the category of ideas, methods, procedures, algorithms or other categories of contributions” outside the scope of copyright protection. Although the Court came to this decision on limited evidence, it could still potentially diminish the types of contributions a software developer can claim give rise to co-authorship.

In 2016 the Federal Court found it did not have the jurisdiction to expunge Andrews’ copyright registrations from the Register because this relief had not been sought. In 2017 Gemstone Travel Management Systems Inc. brought an application “to remedy the [earlier] jurisdictional defect,” and the Federal Court granted the expungement. The case underscores that copyright registration merely creates a presumption of ownership, which can be negated by contradictory evidence. It also serves as a reminder of potential challenges to demonstrate authorship of software. 

Technological protection measures 

In Nintendo of America Inc. v. Go Cyber Shopping (2005) Ltd. et al. (2017 FC 246) the Federal Court released its first substantive decision on the technological protection measure (TPM) provisions in the Copyright Act. The decision has been celebrated by copyright owners, particularly those that rely on TPMs to protect their works. It signals a broad and purposive approach to TPM protections in Canada, and that courts are inclined to grant meaningful remedies against companies that trade in TPM circumvention technologies.

The Nintendo case concerned the sale of devices and technologies by an Ontario business-Go Cyber Shopping-that allowed users to play unauthorized version of Nintendo games on Nintendo gaming systems. At issue was whether these devices and technologies, and the defendant’s sale of them, constituted circumvention of TPMs as prohibited by the Act, as well as secondary copyright infringement. The TPMs at issue included game cartridges that had the same physical configuration (i.e. shape) as genuine Nintendo game cartridges, as well as boot up security checks, and encryption and scrambling code, copy protection code, and a proprietary unique data format.

Nintendo’s boot up security checks, encryption and scrambling code, and other code-driven technologies, were found to clearly be TPMs. In addition, the Court found that the physical shape of the cartridge could also function as a TPM, saying at paragraph 86 that,

the physical configuration of the Applicant’s game cartridges, including the shape of the card and the arrangement of the electrical pins, was designed to fit specifically into a corresponding slot on each of its consoles. Together they operate much like a lock and key. This measure is quite effective in controlling access to genuine Nintendo Games on the Applicant’s game cards.

Statutory Damages 

            Technological protection measures

Nintendo also provides guidance on calculating statutory damages for circumventing TPMs, and in particular, that damages for TPM circumventi
on should be awarded on a &ldqu

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