File sharing in Canada
p2pnet.net News View:- The recent Federal Court of Appeal music file sharing case, in which the court rejected the Canadian Recording Industry Association’s attempt to uncover the identities of 29 alleged file sharers, raises important privacy and copyright issues. Last week’s column reviewed the court’s test to protect personal privacy; this week’s column assesses the copyright implications of that decision.
Although the court declined to articulate definitive conclusions on important copyright issues associated with file sharing, its decision will undeniably have a major impact on copyright policy. This impact is best addressed by analyzing three questions – can CRIA sue file sharers? Can it win such suits? And what legal reverberations might ensue if it does win?
The answer to the first question is relatively straight forward. CRIA can sue file sharers in Canada and it has indeed asserted that the decision provides a blueprint for future suits.
In the aftermath of last year’s trial decision, the recording industry expressed grave concern about the state of Canadian copyright law and lobbied aggressively for immediate changes. In light of the appellate decision, it is now safe to declare the copyright emergency over. In fact, the fears of a devastating effect never materialized. According to CRIA’s own figures, in the thirteen months of reported sales since the March 2004 decision, both sales and shipments have increased.
The answer to the second question – whether CRIA can win file sharing suits – is open to debate, particularly with respect to suits filed against individuals that solely download music from peer-to-peer networks. The complicating factor is the effect of Canada’s private copying system, which establishes a levy on blank media such as recordable CDs. Anna Bucci, the Executive Director of the Canadian Private Copying Collective, the body that administers the $120 million in royalties that have been generated by the levy, last week described private copying as creating “a new right for the Canadian public — the right to make private copies of music for their own personal use.”
There are at least three objections raised to the application of this private copying right to P2P file sharing. First, the right applies solely to copying, not to those who “upload” music on peer-to-peer networks. This objection is certainly valid as neither the Canadian courts nor the Canadian Copyright Board have ever indicated that private copying could be used as a defense against the act of uploading.
Second, CRIA recently argued that the private copying right does not apply to copies made to personal computers. A review of the legislative history of private copying provides little support for this interpretation, however, as the statute was intentionally drafted in a technology neutral fashion such that it could be applied to new copying media, including computer hard drives.
The primary impetus behind the creation of the private copying system was the Charter of Rights for Creators, a 1985 parliamentary committee report. That report explicitly declined to tie the levy to a particular technology, presciently noting that “future recording devices might not use blank tape, thereby making a tape royalty obsolete. The work could be stored in a computer memory with no independent material support at all.”
Eleven years later the Task Force on the Future of the Canadian Music Industry, which was co-chaired by the heads of CRIA and the Canadian Independent Record Production Association, continued to press for the creation of private copying levy to be applied to both media and devices. The technology neutral levy was enacted into law soon after with the industry celebrating success after 15 years of lobbying but lamenting that the delay had “literally killed dozens of careers.”
While the levy was certainly intended to cover computer hard drives, the third objection is whether the provision, as currently drafted, actually achieves that goal. This issue was thrown into some doubt by a Federal Court of Appeal decision last December that upheld the validity of the levy but tossed out its application to MP3 players such as the Apple iPod.
That decision is currently under appeal to the Supreme Court of Canada. If Canada’s highest court overturns the decision, the intent of the legislation will be restored and much of the doubt about its applicability to P2P downloaders will be removed.
If the Supreme Court declines to hear the appeal or upholds the decision, the impact will extend well beyond music file sharing. Some P2P downloading would no longer fall under the private copying right, though downloads to many external or removable hard drives would presumably still qualify. More importantly, copying of store bought CDs onto Apple iPods, a common practice extolled by CRIA itself, would effectively be rendered unlawful in Canada (unless there is an implied right to copy such CDs, which would then call into question the need for a private copying system).
The third question – what might follow if CRIA is successful in its suits – raises the prospect for copyright reform. When the federal government established the private copying right in the late 1990s, it also created a statutory damages system. This enables a copyright holder to obtain specified damages of between $500 and $20,000 per infringement without the need to prove actual damages. There is, however, a saving provision that allows a court to order damages well below the statutory minimums if the total award is “grossly out of proportion to the infringement.”
The statutory damages provision raises several scenarios in the context of file sharing suits. One possibility, common in the United States, is that cases do not actually proceed to trial since even innocent defendants will settle lawsuits to avoid the risk of a massive statutory damages award. Should a case proceed to trial, another scenario is that a court might indeed award damages of hundreds of thousands of dollars based on uploading 1,000 songs onto a P2P network.
Given that fee-based services such as Napster already offer over 700,000 songs for only $14.99 per month, a raft of settlements or a massive award might lead to vociferous calls to Industry Minister David Emerson and Canadian Heritage Minister Liza Frulla for immediate reform to the statutory damages provisions so that a more appropriate remedy can be implemented.
Alternatively, a court might be faced with a sympathetic defendant who could prove that they had legitimately copied store bought CDs onto their computer and logged onto a P2P network in order to download a public domain document or open source software program. In such a case, the judge might be inclined to use the saving provision and set a precedent of a minimal damages award for P2P activity.
The net result of current Canadian law is that file sharing suits are a risky strategy from both a privacy and copyright perspective. The Federal Court of Appeal may have provided a roadmap for such suits, but it is apparent that traveling down that road raises many more questions than it answers.
Michael Geist
[Geist is the Canada Research Chair in Internet and E-commerce Law at the University of Ottawa. He can be reached by email at mgeist[at]uottawa.ca and is on-line at michaelgeist.ca.]
June 9th, 2005 at 12:09 pm
Now in fainess as well what about.. the Unfair and restrictive trade practices by the MPAA versus spreading the wealth..
“A U.S. court ruling tossing out restrictions on the recording of TV programs has implications for new `PC Media Center’ technology NEW: Court blocks TV-piracy rules The Associated Press Washington – A U.S. appeals court today threw out new federal rules requiring anti-piracy technology that would have limited how consumers could record and watch their favorite television programs in the future. The three-judge panel for the U.S. Circuit Court of Appeals for the District of Columbia determined the Federal Communications Commission had exceeded its authority when it announced it would require such technology in digital televisions and other consumer electronic devices sold after July 1 They will be able to take advantage of new products and features that won’t be dictated to them by the entertainment industry.” The controversial rules were challenged by consumer groups, including library associations. Their lawyers complained the FCC requirement would drive up prices of digital television devices and prevent consumers from recording programs in ways permitted under copyright laws. . ”
“If you were an owner of a Sony videocassette recorder in the early 1980s, you may remember some anxious moments when your investment was under threat. In a celebrated U.S. court case in 1984, Universal Studios sued Sony over its Betamax VCR claiming that customers should be able to play videocassettes, but not record them. The Hollywood establishment felt threatened by any technology that allowed customers to make copies of movie videocassettes. The U.S. Supreme Court held, however, that customers had the right to make copies for their own use â much as they used to do with audiocassette recorders. Ironically, Sony, which fought on behalf of the consumer, lost the video format race to the VHS cassette. On Friday (May 6), in what seemed like a replay of that 20-year-old scenario, a U.S. Appeals Court unanimously threw out a regulation of the Federal Communications Commission (FCC) â the U.S. Government’s telecom regulatory body â that would have made it mandatory for all digital TV sets, video-burning personal computers and digital recorders sold after July this year to put in special technology called a “Broadcast Flag”. The “Flag” is a bit of code that is placed in a digital television transmission that is meant to prevent the received signal from being copied or even viewed properly by sets that were not flag-compliant. In other words, if you want to set your TV set or PC-TV to copy your favourite programme as it is aired, so that you can see it later at leisure, you cannot do so. The court ruling, however, says FCC has no authority to regulate consumer electronic devices that can be used for the receipt of radio or TV communications as long as they are not retransmitting the signals. The challenge to the Flag technology mandated by the FCC after intense pressure by American broadcasters and film studios such as CBS and MGM came from consumer and library associations. Their success, it is widely believed, is likely to be repeated, within a few weeks, when another case achieves a ruling: where MGM again is seeking to stop a peer-to-peer file-sharing technology put on the Internet by Grokster. With PCs slowly morphing into what are known as Media Centers, lay home PC users here, increasingly enjoy the ability to view TV and cable content, `burn’ DVDs with their favourite programmes and create their personal libraries of favourite soaps and serials. The technology will allow us to view and record whatever we like ”
“The Motion Picture Association of America, the organization that plays a major part in nearly every movie made, is shutting down thousands of websites worldwide and suing countless individuals simply because they offer information on DVD technology that the MPAA wants to keep out of your hands. The MPAA doesn’t want you to have the ability to play the DVD’s YOU BUY on any DVD player or computer that they don’t control. Imagine if you no longer had the right to buy imported CD’s. With DVD’s you can be prevented from playing any disc that is bought in another country. You could easily find yourself not able to watch a movie at a friend’s house, because his video player isn’t blessed by the MPAA. The MPAA wants to be able to control not only the content, but the hardware as well. A recently written computer program allows consumers to do something the MPAA doesn’t want them to do – use DVD technology in a competitive and individually tailored environment. People who do this are NOT DVD pirates! Recent MPAA statements have repeatedly claimed that piracy is the only issue here. It has ALWAYS been possible to copy DVD’s — that is not what the people being sued, threatened, and intimidated are doing. What the MPAA doesn’t want you to know is that they want TOTAL CONTROL over every aspect of consumer DVD use. Some technologically adept people have figured out ways of using this technology and that has been deemed a crime by the MPAA. By threatening publishers and free speech advocates with fines and imprisonment if they continue to explore this technology, the MPAA has stifled free speech in a way that’s never been done before in this country. If they are allowed to continue, this repressive atmosphere could spread to all aspects of our lives. You could one day find yourself being prosecuted for something as simple as opening the hood of your own car to find out what’s making that funny noise.” “Most of you know that DVD’s have been encrypted so that it becomes necessary for us to decrepit them if we intend on converting them to DivX or any other video format on our computer systems. This encryption system is called CSS and the teenager quoted above is Jon Johansen. He was arrested because of posting the code for a program called DeCSS which was designed for decrypting a DVD. He did this in order to help design a DVD player for Linux. After putting the code on line 2600 magazine (so called for the frequency tone used to make free long distance phone calls) is still fighting for the right to publish this code. But what you probably didn’t know is that in spite of what the MPAA* claim, DVD encryption was not designed to prevent piracy! This myth was merely a smokescreen designed to hide the truth. What they have been doing with DVD’s is actually illegal! * The MPAA or Motion Picture Association of America is an organisation that includes Sony, Universal, MGM and Warner Bros. Most people don’t seem to understand that a DVD can be copied with all the encryption still on it. Its analogous to a secret code written on a piece of paper, you do not need to understand the code in order to copy it. Any photocopying machine would do the job. In actual fact we already have our own computerised photocopying machine, its called Windows! All you need is a DVD player such as PowerDVD to copy the contents. Start your movie playing, then go to your DVD drive (using Windows Explorer) and copy the DVDs contents across! All the contents are still encrypted of course. But anyone with a DVD writer should be able to burn them onto another disc, you should know that this is very common knowledge – it’s not a secret. In their own defence the MPAA have their own little propaganda page (http://mpaa.org/). It tells people their reasons for creating CSS and why they are trying to stop people from decrypting it. But what it doesn’t tell you is why they really created CSS. When Jon Lech Johansen was found with the decryption code on his computer claimed he was trying to develop a DVD player for Linux. As many of you know Linux is the major contender for Windows, where reliable operating systems are concerned. The beauty of Linux is not only that is it more powerful and bug free than Windows, but it is also completely free software! Microsoft have been so frightened by it that they have been trying to figure out ways to turn people off of it, which resulted in the so called “Halloween Documents” that accidentally slipped out. They detailed how they intend to malign Open Source software such as Linux. Microsoft admitted these document were genuine The only real failings of Linux so far are that, since Windows was the Monopoly, it is not a very well supported Operating System because it has very little software developed for it. At the time Jon Lech Johansen made DeCSS there was no DVD player planned for Linux by any company. Jon knew that given the choice people would choose Windows instead of Linux if it were the only operating system with a DVD player. Those who know the history of Linux also know that it was built with the help of the Internet community, all devices built from it were usually done in this manner, by exchanging information (such as DeCSS) for free. Decrypting the DVD code to make a DVD player comes under the legal aspect of “reverse engineering”. According to the 1998 US Digital Millennium Copyright Act section 1201(f) ‘reverse engineering of a copy-protection encryption system is legal for reasons of “interoperability” between computer systems.’ Which means Jon didn’t need authorisation to try and figure out how DVD’s were encrypted. Technically he had the right under both American and Norwegian law. Nevertheless they arrested poor ol’ Jon over it. The MPAA propaganda page claims that “the De-CSS utility was written for Windows-based software, not Linux”. They are trying to cause doubt by implying Jon was lying about his Linux claims and was in fact just a wannabe DVD pirate. Jon explained long ago why he did this, he says: “Linux did not have UDF support [the filesystem used on DVDs]. It was thus natural to implement it under Windows in order to test if it actually worked. Yes, I’ve used Windows, nobody’s perfect”. This is obvious to any programmer. If you are going to reverse engineer a DVD you need to be able to read it to see if it works! And since the Linux OS cannot read a DVD to decrypt it, it was not possible to even start development. Since there was no Linux DVD players, he was forced to reverse engineer a Windows DVD player, hence a Windows DeCSS. The MPAA now claim that a fully licensed Linux DVD player exists as another argument. In truth none exist!
Why do DVDs use Encryption? The main reasons why DVD’s were encrypted is that they are designed to get more money. The CSS encryption system uses region codes, these are:
Zone 1: United States, Canada
Zone 2: Europe, UK, Japan, South Africa, Middle East, Greenland
Zone 3: Hong Kong, East & Southeast Asia
Zone 4: Australia, Pacific Islands, New Zealand, South America, Caribbean
Zone 5: Russia, Indian Subcontinent, North Korea, Africa, Mongolia
Zone 6: China
These zones prevent anyone from importing DVD’s from other countries. Unless the DVD CSS region code is set for that country the DVD will not play! Since the MPAA usually control the release of movies so that they are released half a year later to the rest of Europe than they are in the USA, they are able to control the prices people pay for their movies. Believe it or not we are actually being charged much more than a DVD costs after normal video profit margins. If we don’t count studio mastering, the actual manufacture per unit price of a DVD’s is about one fifth that of a VHS tape! But I have no right to complain the quality may be twice as good as VHS. The problem is encryption allows them to introduce a method of sale known as ‘price discrimination’. Price discrimination is considered illegal according to U.S. and international law! As a result poorer countries (such as India) are only charged a fraction of the price the rest of Europe. Unless a CSS encryption system was incorporated into DVDs it would be possible for someone in Europe to import a load of Indian DVDs and not need to pay the extra money!” “The movie industry moans about piracy as though it’s making them really poor. But in fact they know darn well that sales have increased over the years and if DVD’s were reasonably priced then people would be much more inclined to buy a high quality commercial copy rather than a bootlegged one.”
” But price fixing is only part of the reason DVD encryption was used. The next major reason concerned the licensing of DVD players. Remember that Jon Johansen was arrested when he tried to make a Linux DVD player. If DeCSS got loose who knows how many rogue DVD players could have been produced without the say so of the MPAA. Since the DVD consortium did not hold all the patients over Mpeg-2 or Video CD technology it was impossible to stop any manufacturer from making a DVD player. Nowadays anybody can make a VHS video player and it looked like the same would apply to DVD. If the MPAA couldn’t control who made DVD players then they also couldn’t keep the region zone scheme going. So they invented another little trick, the licensing scheme. They invented a standard for DVDs and patented it. If anyone in the world wanted to make a DVD player they needed to pay them for the privilege. With a licence agreement they could then demand you keep to their region codes. In fact they can demand anything they like, which is why, for example, DVD players cannot fast-forward past their adverts. This problem is a serious one. Two years after the first release of the DVD format the Chinese government reject DVD and created their own standard of MiniDVD called SVCD (Super Video CD). Why would they spend so much money on a new video format? Because they didn’t like how DVD’s were controlled. China didn’t want foreign countries demanding so much for a technology that was little more than a CD upgrade. It was insulting to them because China had been leading the way in Video CD’s long before DVDs had even existed! DVD licences are expensive! For the Linux community to create a DVD player like they had created Linux would probably have proved impossible. A licensee must pay a security payment of between $750,000 and $1 million, which would be forfeit if the license was ever breached. Additionally, it is said that the DVD CAA (a supposed non-profit industry association) would also require a 6% royalty fee on all sales! The MPAA have also refused certain people the right make DVD players because they were too small companies. This gives the MPAA far too much control over the market. If, for example, they liked Microsoft, they could just deny a Linux DVD player licence. As a result this would give Microsoft a distinct advantage. Their blatant insistence on control of who can and cant make DVDs is another thing that should be illegal under the Sherman antitrust act. As far back as 1948 the US Supreme Court outlawed this practice (United States v. Paramount Pictures, Inc, 334 U.S. 131). Make no mistake the creators of DVDs are not worried about common home piracy. No doubt their marketing experts can see it poses no real threat. They are merely trying to tighten their monopoly over the world and make as much money as they possibly can. It’s no wonder they say that the ‘biggest criminals wear suits!’ http://nickyguides.digital-digest.com/criminals-wear-suits.htm
June 9th, 2005 at 1:25 pm
I always enjoy Mr. Geist’s articles.
One thing that really bothers me is when the Canadian Recording industry make these wildly impossible statements like careers have been killerd by file sharing and poor copyright laws in Canada.
You have to look pretty damn hard to find a handful of Canadian artists on most file sharing networks. Seriously.
I think the Canadian Recording industry problemly makes more from the CD/tape tax than they lose on P2P networks.
And why are the “minority” legislative powers in Ottawa moving so quickly to redefine Canadian law in the face of such rampant and grossly distorted facts and figures.
Canadians should be contacting their elected officials and tell them let the people not the private interests decide the fate of Canada’s long-standing, tolerate and reasonable fair use practices.
How rich must the rich be to be satisfied?
August 8th, 2007 at 5:42 pm
Ben…
Keep in mind that buying cheap homes doesnÂt necessarily mean buying…