ARIEL KATZ ASSOCIATE PROFESSOR INNOVATION CHAIR, ELECTRONIC COMMERCE

November 21, 2010 Mr. Gilles McDougall Acting Secretary General The Copyright Board of Canada 56 Sparks Street, Suite 800 Ottawa, Ontario K1A 0C9 Dear Mr. McDougall,

- BY EMAIL -

Re: Access Copyright’s Post-Secondary Educational Institutions Proposed Tariff (20112013) - Submission Pursuant to the Copyright Board’s Notice Dated Nov. 15, 2010 Pursuant to the Copyright Board Notice, dated Nov. 15, 2010 I hereby make this submission regarding the contemplated changes in the status of various parties who filed timely notices of objection. I am one of these objectors. I am a law professor at the University of Toronto and the proposed Tariff, if approved, will affect me in direct and profound ways. It may subject me to legal obligations that otherwise would not exist; it may expose me to liability for acts that otherwise would be totally lawful; it threatens my privacy and my academic freedom. Moreover, and notwithstanding the misnomer AC chose as its trade name, the anti-competitive nature of the Tariff will limit the scope of materials which I will be able lawfully to access. Before addressing the contemplated changes in parties’ status, I would like to direct the Board’s attention to some ambiguities in the Notice, which I would request the Board to clarify as outlined below in Part A. Part B of this submission details my objection to the contemplated changes in various parties’ status. In a nutshell, the right to object to a proposed tariff was granted by Parliament and is not subject to the Board’s discretion. With regard to the majority of the persons who filed objections, Access Copyright’s Submission from Sept. 22, 2010 reveals no basis on which their status of objectors could be denied. Therefore, the Board should deny Access Copyright’s submission and refrain from changing the status of those objectors to whom Parliament granted such right. Alternatively, if the Board still decides to relegate me or other objectors to a new status, I would expect it to give adequate reasons for such an unprecedented ruling.1

1

Canadian Association of Broadcasters v. Society of Composers, Authors & Music Publishers of Canada, 2006 FCA 337, at para. 11
Faculty of Law, 78 Queens Park, Toronto, ON, Canada M5S 2C5 Tel: 416-978-8892 Fax: 416-978-2648 ariel.katz@utoronto.ca www.law.utoronto.ca/faculty/katz

2 A. Request for Clarification Background 1. On September 22, 2010 Access Copyright (“AC”) requested that apart from the AUCC and the ACCC, all other individuals and organization who filed notices of objection do not qualify as “objectors” within the meaning of subsection 67.1(5) of the Copyright Act (“AC’s Submission”).2 2. On November 15, 2010 the Board issued a Notice. According to the Notice, the Board found that AUCC, ACCC, Athabasca University and BCAIU, “being targeted by the proposed tariff, are proper objectors.” 3. The Board also found that Mr. Degen's letter in support of the proposed tariff would be treated as a letter of comment. Since a supporter cannot logically be an objector this finding flows directly from subsection 67.1(5). 4. Nevertheless, there exists some ambiguity and uncertainty with regard to the status of many of the other individuals and organizations that filed objections. Therefore, it would be prudent for the Board to dispel this ambiguity by issuing a clarification as requested below. 5. The Notice suggests that with the exception of a few named parties, the Board has not yet reached any decision about the status of the other individuals and organizations who filed an objection. The Board distinguished between the government of Alberta and of teachers, students and staff from the targeted institutions in the proposed tariff on the one hand, and a group of other 38 individuals on the other.3 With respect to persons from the first group, the Board formed a “preliminary opinion” that their participation “would enrich the record of these proceedings and assist the Board’s deliberations.” It therefore indicated that it would be “inclined to grant them, if they so wish, “intervenor status with full participatory rights, in effect allowing them to act in these proceeding as if they were objectors”. The Board then explained that “[t]o the extent that the contemplated status is granted, it is not necessary to rule on whether these persons are proper objectors.” It invited AC, AUCC, ACCC, Athabasca University and BCAIU to submit their views about this contemplated status of “intervenor with full participatory rights” (IFPRs). 6. With respect to the group of 38 individuals, the Board formed the “preliminary opinion” that their “participation … would not be of assistance.” It suggested that it might give them an intervenor status if they apply for such status, but it would only rule on their status after they submitted their applications and the other parties had the opportunity to comment on them. The Board, however, did not specify whether these individuals’ contemplated status is of ordinary intervenors or IFPRs. 7. The Board did not indicate whether it made any ruling with respect to the status of two prospective users’ representative organizations: CAUT and CFS.

2

On October 13, 2010 I filed an Initial and Partial Response the AC’s submission. In my Response, I noted that it would be prudent for the Board, if it intended to consider AC’s Submission, to invite all interested parties to submit their own views on that issue before making any decision. In addition, I noted in my Response that AC’s Submission has no basis in law and briefly provided the grounds for my submission.
3

The Board also asked three Academic institutions to clarify whether the institution or its library is being represented.
Faculty of Law, 78 Queens Park, Toronto, ON, Canada M5S 2C5 Tel: 416-978-8892 Fax: 416-978-2648 ariel.katz@utoronto.ca www.law.utoronto.ca/faculty/katz

3 8. While it is clear that the Board ruled against AC and found that Athabasca University and BCAIU do qualify as objectors, it seems that the Board has not decided yet about the status of all the others who filed objections. The Board’s carefully used the terms “preliminary opinion”, “inclined to grant”, and “to the extent that the contemplated status is granted.” Furthermore, the invitation of some parties to comment about the contemplated status of others suggests that no decision has been made yet. 9. This conclusion is also supported by the fact that a many of the objectors are indeed “prospective users” within the plain meaning of the Copyright Act. Therefore, a ruling that denies, changes, or potentially limits their statutory rights without giving them the opportunity to make their opinion about such drastic outcome known (and solely on the basis of their opponent’s submission), would run afoul the fundamental principles of due process and fair adjudication. Presumptively, the Board would not do that. 10. Nevertheless, there are some lingering doubts. First, the Board only invited some of the parties to make their views known about the participation of the potential intervenors. Ostensibly, the potential intervenors are not invited to submit any opinion about the change of their status, only to inform the Board whether they wish to assume this status or not participate at all. The Notice does not even contemplate an opportunity to reply to the submissions of the invited parties. 11. Although it is hard to imagine that the Board would invite some parties to comment on the status of others, but would not invite those affected by such ruling to make their views known to the Board, this seems to be what the Notice stipulates. 12. Such outcome would also be inconsistent with the Board’s promise that IFPRs will be treated as any objector and will have full participatory rights. Yet, the failure to invite the IFPRs to express their views already indicates their relegation to a lower status, and oddly suggests that while the Board regards IFPRs as equal, it views some other parties as “more equal”.4 13. Therefore, to remove any doubt that the Board actually intended to achieve such an Orwellian outcome, and to clarify that the above confusion is a result of an an inadvertent error, it is requested that the Board issue the following clarification: a) That all parties are invited to make their views known about the different level of participation contemplated by the Board; b) That the parties whose status of proper objectors might be denied, would have the opportunity to respond to the other parties’ submissions. 14. There is also some ambiguity about whether the proposed IFPRs will truly have full participatory rights and will be treated as any objector. First, as mentioned above, they have already been treated, perhaps inadvertently, as “less equal”. Second, while the Notice mentions many participatory rights, it does not mention all of them. For example, it is not clear that IFPRs can file motions, cross-examine witnesses, call their own experts, and

4

Cf. George Orwell, Animal Farm (Penguin Books: London UK, 2008), at 90 (“All animals are equal, but some animals are more equal than others”).
Faculty of Law, 78 Queens Park, Toronto, ON, Canada M5S 2C5 Tel: 416-978-8892 Fax: 416-978-2648 ariel.katz@utoronto.ca www.law.utoronto.ca/faculty/katz

4 present oral arguments apart from at the end of the hearings (which may occur many years from now). Although it seems reasonable to interpret the participatory rights that were mentioned merely as examples, the Notice does not use any term supporting this interpretation such as, “without limitation”, “such as”, or “for example”. 15. Moreover, since the Board is inclined to make a distinction between “proper objectors” and “IFPRs”, it seems that, presumptively, there must be some difference between them that justifies the different terminology. If that is not the case, one would expect the Board to unequivocally state that. If that were the case, one would expect the Board to clarify the distinction for future guidance.

B. Position and Argument Regarding the Status of Several Objectors The Board has no Power to Deny Rights Granted by Parliament 1. The Board’s Notice states the following: “Having read all notices, the Board is … of the preliminary opinion that the participation of the government of Alberta and of teachers, students and staff from the targeted institutions in the proposed tariff would enrich the record of these proceedings and assist the Board's deliberations. As such, the Board is inclined to grant them, if they so wish, intervenor status with full participatory rights, in effect allowing them to act in these proceedings as if they were objectors. To the extent that the contemplated status is granted, it is not necessary to rule on whether these persons are proper objectors.” 2. The Board should not pursue this approach, which is based on a wrong assumption and has no basis in law. It is common ground that the Board has broad authority to determine its own procedure, and this authority allows it to create various types of participants, allow interveners, and in general, allows it to expand the number and type of parties participating in the proceedings before it beyond those specifically mentioned in the Copyright Act.5 It is also common ground that “[t]he only limitations on the authority of the Board to determine its procedures are those arising by express terms of the Act…”6 However, the right to object and the concomitant status of an “objector” are an example on such statutory limitation. These rights were granted by Parliament and mandated by the Act. 3. Under subsection 67.1(5) “prospective users” or “their representatives” may file written objections to a proposed tariff. Therefore, any “prospective user” or any “representative” of “prospective users” who filed a timely written objection is an “objector.” The Board has no power to deny this status. Just as the Board “may not treat submissions as objections under the Act unless they are written, filed on time and are from users or their representatives”,7 it cannot treat submissions meeting these requirements in any manner other than as objections. 4. The status of an objector, created by Parliament, is not subject to the Board’s discretion. It does not depend on the potential for substantive contribution of the objection to the
5

Society of Composers, Authors & Music Publishers of Canada v. Canada (Copyright Board), 47 C.P.R. (3d) 297, 61 F.T.R. 141 (1993).
6 7

Ibid, at para. 41. Ibid, at para. 52.
Faculty of Law, 78 Queens Park, Toronto, ON, Canada M5S 2C5 Tel: 416-978-8892 Fax: 416-978-2648 ariel.katz@utoronto.ca www.law.utoronto.ca/faculty/katz

5 proceeding before the Board. The question whether someone’s perspective would assist the Board in fulfilling its mandate is relevant only when a party (other than an objector) seeks a status of an intervenor. For determining the status an objector, however, the only questions are: (1) was the written submission filed on time; (2) by a prospective user or a representative of users; and (3) does it express objection to the tariff (as opposed to supporting it, for example). When those conditions are met “all objections are equal before the Board and all objectors must be presumed to have status.”8 5. It is also immaterial that the Board has the power to grant a particular applicant a status of intervenor and could decide to grant such intervenor procedural rights identical to those of an objector. The status of an objector is conferred upon the objector upon satisfying the threeabovementioned conditions. The right to object and the concomitant status of an objector were granted by Parliament; the Board cannot replace them with someone else as similar as it may be. 6. According to the Notice, with the exception of Mr. Degen’s submission, all other submissions were filed on time and expressed objection. Therefore, the only issue is whether prospective users or their representatives submitted them. Therefore it remains to be determined who is a “prospective user”. Who is a Prospective User: Generally 7. At the outset, it should be emphasized that the terms “prospective users” and “their representatives” must be broadly construed. Yet, to support its contrary position and overly narrow construction, AC relies on an amendment to the Act enacted in the aftermath of the Federal Court decision in Canadian Broadcasting Corp. v. Canada (Copyright Appeal Board).9 AC draws the wrong conclusions from this case and the subsequent statutory amendment. 8. In that case the CBC’s was a prospective user under proposed tariffs filed by PROCAN and CAPAC. The CBC sought to deny a status of objector from two parties: SPACQ and CIRPA, who filed objections, maintaining that the proposed tariffs should be increased. The CBC and other prospective users objected to the participation of SPACQ and CIRPA on the grounds that the members of SPACQ and CIRPA, for the most part, had already assigned their relevant copyrights to PROCAN and/or CAPAC, and therefore, did not have an independent interest from CAPAC and PROCAN. 9. At that time, the relevant section of the Copyright Act (then subsection 49(1)) provided that “any person” could lodge an objection. The CBC sought to limit this status only to users. The court declined to give the phrase “any person” such narrow construction and took the position that the regulatory framework created by Parliament for the oversight of collecting societies justifies a large and liberal interpretation of the right to object to a tariff. The court emphasized that “if an objection has been filed on time, pursuant to the notice published … in the Canada Gazette, all objections are equal before the Board and all objectors must be
8

Canadian Broadcasting Corp. v. Canada (Copyright Appeal Board), 7 C.I.P.R. 194, 8 C.P.R. (3d) 484, 3 F.T.R. 241 (1986), at para. 33.
9

Ibid.
Faculty of Law, 78 Queens Park, Toronto, ON, Canada M5S 2C5 Tel: 416-978-8892 Fax: 416-978-2648 ariel.katz@utoronto.ca www.law.utoronto.ca/faculty/katz

6 presumed to have status. Once having obtained status, they, like the applicant who is also an objector, must have equality before the Board.”10 10. Two years later, however, the Act was amended and the term “any person” was replaced by the phrase “prospective users or their representatives”, currently in subsection 67.1(5). It is clear, therefore, that the change from “any person” to “prospective users and their representatives” was meant to address the peculiar situation in which a collective society files a proposed tariff and then its members oppose on the ground that the tariff is too low; the amendment reflects Parliament’s intent to protect and empower users, not to restrict their right to object. The amendment would prevent members of AC from proposing higher fees by “opposing” to those requested by AC. Parliament agreed with the CBC that the right to object should not be granted in such situations and adopted the CBC’s view the objectors should be prospective users (and their representatives). Parliament could never have intended that this amendment would restrict or weaken their ability of those targeted and affected by a tariff to object. Therefore, as before the amendment, prospective users’ right to object should be liberally construed. AC’s Submission turns the statutory amendment on its head. 11. It follows that in order to deny a status of an objector, the Board must be persuaded that the person who submitted a timely objection is NOT a prospective user or NOT a user representative. The burden of persuasion is on AC. 12. Contrary to what is suggested in the Notice, the Board does not have to decide affirmatively who IS a proper objector. It only has to rule whether it was persuaded by AC’s Submission that those persons are NOT proper objectors. If the Board is not so persuaded, these persons must be presumed to be objectors. It is only after a finding by the Board that a person who filed a timely objection is not an objector that the Board can consider granting it another status, but it cannot grant another status without making such finding first. 13. AC’s Submissions fails to meet the burden of persuasion. It submits that only an academic institution can be considered a “prospective user” under the Copyright Act, and that accordingly only an academic institution, but not its teachers or students, for example, would have standing to object to the Tariff. This view is too narrow, contradicts AC’s own definitions, and has no basis in law. Accordingly, the Board should reject it. Who is a Prospective User: Specifically 14. In its Submission, AC contends that only the targeted institutions are “prospective users” having standing to object. It advances three main arguments to support its contentions: 15. First, it argues that only the academic institutions would have an obligation to pay the Tariff amounts, but not students or teachers. That is factually correct (in a very strict sense), but irrelevant. The supra-competitive fees that AC members seek to impose on the academic institutions would have to be paid somehow. Without a corresponding increase in their budgets, the institutions would have to either increase the fees paid by students (as many of them have done in the past), or cut on other expenses, e.g., reduce their subscriptions and acquisitions budgets. These effects would be felt directly by the objectors.

10

Ibid.
Faculty of Law, 78 Queens Park, Toronto, ON, Canada M5S 2C5 Tel: 416-978-8892 Fax: 416-978-2648 ariel.katz@utoronto.ca www.law.utoronto.ca/faculty/katz

7 16. AC further maintains that only the targeted institutions are responsible for reporting, recordkeeping, and surveying compliance, while teachers and students will only make copies under the proposed Tariff. This assertion is incorrect and misleading. It portrays an imaginary reality in which the Tariff would confer upon teachers, students and other staff worriless liberty to copy works for their academic pursuits, while all the burdens (financial, administrative, or otherwise) would fall on the institutions. If only that were so. 17. Complying with reporting, record-keeping and surveying requirements would necessarily impact teachers, students, and other staff because the activities reported, recorded and surveyed are the activities of teachers, students and staff members. These requirements will have a detrimental effect on privacy and academic freedom, because in order to comply with them the institution would have to ensure the compliance of teachers and staff (see section 13(1), for example). 18. Nor does the Tariff confer upon teachers, students and staff worriless liberty to copy the works covered by the Tariff. Section 4, for example, imposes onerous restrictions on the use of works, including unprecedented “book-burning” provisions, such as the ones contained in subsections 4(2), 4(3) or 5(4). The Tariff also aims at restricting many lawful uses, yet section 15 demands that the academic institution shall take steps to ensure compliance with those conditions—even those that otherwise would be lawful. 19. Furthermore, if approved, the Tariff would change the legal rights and obligations of teachers, students and staff. It can expected that AC or its members would take the position that use made without full compliance with the various conditions is an unauthorized use, for which the relevant teacher, student of staff member could be personally liable. 20. Therefore, the assertion that the proposed Tariff only targets the institution but not their teachers, students and staff misrepresents its nature, its intended purpose and its effect. The proposed Tariff not only targets teachers, students and staff directly and explicitly, it targets the core and very essence of their everyday academic activity. 21. Second, AC argues that “when the term “prospective user” is read in the entire context of the collective licensing regime imposed by the Copyright Act, it becomes clear that this term refers to entities responsible for payment under a given collective’s licensing scheme.” The examples given are sections 30.3 and 70.17. The term “user”, however, is not mentioned in any of these provisions, so it is not clear how they aid in its interpretation. If anything, the provisions strengthen the conclusion that teachers’, students’ and staff members’ right to object to a tariff is independent of that of the academic institution. 22. For example, s. 30.3 identifies some conditions under which the institution will not be liable for the infringing acts of its members. It clearly does not immunize the members; that would defeat its purpose. Moreover, if AC’s interpretation of 70.17 is correct, and the immunity it creates applies only to the institution who paid or offered to pay but not to its individual members, the remarkable outcome would be that if the proposed Tariff is approved, the academic institutions will pay millions of dollars for various Authorized Purposes by Authorized Persons (as defined by the Tariff), those persons would have to comply with various conditions, but these payments would only immunize the academic institution, not its teachers, students and staff. Such an outcome hardly provides a compelling reason to deny such individuals and their representatives the right to object.
Faculty of Law, 78 Queens Park, Toronto, ON, Canada M5S 2C5 Tel: 416-978-8892 Fax: 416-978-2648 ariel.katz@utoronto.ca www.law.utoronto.ca/faculty/katz

8 23. In fact, both s. 30.3 and 70.17 (or AC’s interpretation thereof), only emphasize the point that while an academic institution, a teacher, a student, or a staff member, may all be authorized under a tariff, each of them could face different legal risks, each may be liable for different acts and on different grounds, and at times their legal interests might be in conflict. This only strengthens the conclusion that no group can adequately represent the interests of the other. Members of each group should have equal standing before the Board. 24. Thirdly, AC contends that only the academic institutions are the prospective users because students, faculty librarians and their respective representative organizations “are not, and never have been, licensees of Access Copyright, nor could they be under the Tariff.” AC’s argument, however, is based on a fundamental mistake: it confuses the question of who has the obligation to pay with the questions of who is a licensee; it confuses the question of with whom it negotiated in the past, with the question of who is a prospective user having statutory standing to object. 25. Moreover, this contention is inconsistent with the words of the Act and with AC’s own chosen words in the Tariff. As per sections 70.1 and 70.12, a proposed tariff must be “licensing scheme”, it must set out “classes of uses” that AC agrees to “authorize” and it must set out the relevant royalties, terms and conditions. 26. The phrase “classes of uses” contemplates “users”, and those are defined in s. 2 of the proposed Tariff under the definition of “Authorized Person”. This definition includes “a Student or a Staff Member” (and those are later defined as including an instructor, professor, librarian and other university staff). Because the proposed Tariff contemplates “classes of uses” by students, instructors and other staff, every such “Authorized Person” is both a “prospective user” for the purpose of s. 67.1(5), and a licensee under the proposed Tariff. If that were not so, there would be no “licensing scheme” for the Board to approve. To argue that a person explicitly authorized to copy a work under the Tariff is not a user and that the authorization is not a license defies all logic. Such contention also runs against first principles of copyright law, namely that a “licence is merely a permission or consent to do that which would be otherwise unlawful.”11 A license does not necessarily require payment, and even when it does, the question of who is a licensee is separate from the question of who has the obligation to pay for the license. The two need not be the same person. 27. To put it otherwise, even though the obligation to pay the proposed royalties might fall on the academic institution (ignoring for the moment this financial burden will be borne by many others), the Authorized Persons are the ones who use the works (by reproducing them, posting them electronically, etc.). They are also the ones who bear legal risks of being personally liable should they fail to comply with the various limitations and conditions that the tariff proposes to impose on them, and they are the ones whose privacy and academic freedom the proposed tariff threatens. 28. Consequently, as long as students, instructors and other university staff are the ones using the works; as long as they are expected to comply with the proposed tariff’s terms and conditions; as long as they could be legally liable should they fail to comply; and as long their
11

John S, McKeown, Fox on Canadian Law of Copyright and Industrial Designs, 4th ed. (Toronto: Thomson/Carswell, 2003) (loose‑leaf updated 2008, release 1), at 19-26.
Faculty of Law, 78 Queens Park, Toronto, ON, Canada M5S 2C5 Tel: 416-978-8892 Fax: 416-978-2648 ariel.katz@utoronto.ca www.law.utoronto.ca/faculty/katz

9 privacy and freedoms would be compromised by the tariff, they are “prospective users” for the purpose of the Copyright Act and this proceeding, and have the right, granted by Parliament fully to participate in it as equal objectors. 29. The notion that these individuals are not “prospective users” and that they and their representatives should be denied full and equal standing in a proceeding that directly affects their rights and obligations is not only incompatible with AC’s own definition of an “Authorized Person” and with the express language of the Copyright Act, it also runs afoul the fundamental principles of due process and fair adjudication.12 30. In sum, AC’s Submission fails to show that teachers, students, librarians and other staff from the targeted institutions are not “prospective users.” Therefore, their status of objectors and the status of their respective representative organizations of objectors, granted by Parliament, cannot be taken by the Board. C. Relief Sought 1. In light of the above, I respectfully request the Board to rule as follows: 2. Clarify at its earliest convenience that: a) All parties are invited to make their views known about the different types of participation contemplated by the Board; b) All parties whose status of proper objectors might be denied, have the opportunity to respond to the other parties’ submissions; c) The Board should indicate the deadlines by which such submissions ought to be filed. 3. The Board should deny AC’s Submission and affirm that all the individuals who are either teachers, students, librarians or other staff members in institutions targeted by the proposed Tariff, or representative organizations of such individuals are proper objectors. 4. Should the Board decide to deny such status from a particular individual or organization, it should provide adequate reasons for such decision. Yours respectfully, Ariel Katz

12

Society of Composers, Authors & Music Publishers of Canada v. Canada (Copyright Board), 47 C.P.R. (3d) 297, 61 F.T.R. 141 (1993), at para. 41.
Faculty of Law, 78 Queens Park, Toronto, ON, Canada M5S 2C5 Tel: 416-978-8892 Fax: 416-978-2648 ariel.katz@utoronto.ca www.law.utoronto.ca/faculty/katz

Sign up to vote on this title
UsefulNot useful