Innovation Minister Navdeep Bains and Heritage Minister Mélanie Joly established the Copyright Board consultation to help creators get paid faster. The harmonization of statutory damages would help accomplish that, writes Barry Sookman.

By Barry Sookman, June 14, 2018

Everyone agrees that the Copyright Board needs fixing. A Senate committee recommended a full review in 2016. The government acted on the recommendation by convening a public consultation and received numerous submissions.

One of the government’s options to make the board more effective is to harmonize the availability of statutory damages so they are available to all creators represented by collectives and not only those represented by the performing rights societies SOCAN and Re:Sound, the music licensing company.

Michael Geist opposes harmonization. His opposition does not withstand scrutiny.

He claims that removing the discriminatory treatment between classes of collectives would pre-empt the work of the Industry Committee doing the mandatory copyright review. But, the government is approaching copyright reform on two tracks and harmonizing statutory damages is squarely within the Copyright Board consultation. The consultation paper specifically asked whether the different collective administrative regimes could be harmonized and specifically whether the statutory damages regime should apply to all collectives.

Innovation Minister Navdeep Bains emphasized reforms to provide ‘an efficient, transparent, stable and predictable regulatory environment.’ The Hill Times photograph by Sam Garcia

Both ministers in charge of copyright stated that a goal of the Copyright Board’s reform is to get creators paid faster. Heritage Minister Mélanie Joly stated: “we will reform the Copyright Board to ensure that we … pay our artists faster and reduce costs for all parties” and also to “enable creators to efficiently access …stable streams of revenue.” Innovation Minister Navdeep Bains emphasized reforms to provide “an efficient, transparent, stable and predictable regulatory environment.”

Understanding the fundamental link between mechanisms that lead to a tariff being set by the board and the ability to predictably collect royalties—and in response to the government’s specific question as to whether all collectives should be treated equally—creators supported harmonization.

Geist suggests that only Access Copyright wants harmonization. In fact, it was supported by collectives and industry groups representing creators from Quebec and across Canada and from the spectrum of the cultural industries including program producers, visual, and media artists, music artists, performers, composers, publishers, and makers of sound recordings, and authors and publishers of books.

Geist argues that the proposal would have “a dramatic impact on substantive copyright issues such as fair dealing.” That is just wrong. When setting tariffs the board doesn’t include royalties for uses of works covered by fair dealing.

Geist incorrectly claims that harmonization threatens “to create massive liability risks for some copyright stakeholders.” Users can appear before the board to oppose a tariff, argue that dealings are fair dealings, or for a lower royalty. Once a tariff is certified, users know what has to be paid. The integrity and respect for the board process is undermined if creators wait years for a tariff to be certified and still can’t get paid.

When statutory damages were first introduced into law the government published a fact sheet. It explained, contrary to Geist’s claims, that statutory damages provide deterrents against infringement, better compensate copyright owners, ease the evidentiary burden in infringement proceedings, reduce the costs of litigation, and encourage settlements. The additional rational for statutory damages for collectives included “to encourage users to obtain the appropriate licences beforehand.”

The technical lacuna in the existing regime unfairly discriminates against creators represented by collectives that are not performing rights societies. Geist argues this can be justified because only latter collectives are compelled to apply for tariffs. But the distinction between collective types is one without a material difference.

First, the tariff process is compulsory for CRC. Second, in both regimes the copyright holder has the option to sue for infringement if a user refuses to pay the tariff or the collective can sue for payment of royalties under the tariff; the only difference in the regimes is that the performing rights societies must first file tariffs. In both cases, copyright holders cannot sue a person for infringement who has paid or offered to pay the applicable tariff. Third, for all practical purposes creators have to rely on the collective regime. Many don’t have the resources to track down or negotiate licenses with thousands of users for thousands of works, especially with the explosion of uses arising from digitation and the internet.

Joly and Bains established the Copyright Board consultation to help creators get paid faster. The harmonization of statutory damages would help accomplish that.

Barry Sookman is a member of the Macdonald-Laurier Institute's advisory council and senior partner with McCarthy Tétrault Technology Law Group.

(Image source: Innovation, Science and Economic Development Canada)