What Happens when Fair Dealing is not “Fair”?

Credit: author

February 21-25 is Fair Use/Fair Dealing week, so proclaimed by a number of participating organizations in the US and Canada and organized by the Association of Research Libraries under the umbrella of fairuseweek.org. As in past years, there will be a series of online events extolling the virtues of fair use and fair dealing. Fair dealing and fair use are firmly embedded as part of the copyright ecosystem and have been for many years, although the interpretation of what constitutes “fairness” is far from static.

This is the definition of fair use and fair dealing from fairuseweek.org’s website;

Fair use and fair dealing are essential limitations and exceptions to copyright, allowing the use of copyrighted materials without permission from the copyright holder under certain circumstances.”

Fair enough. The term “under certain circumstances” says it all. This is the very crux of the issue when determining whether or not a use, without the permission of the rights-holder, is fair. Courts are periodically called on to determine what is fair and what is not. In the case of fair dealing in Canada, there are a number of “exceptions” or “allowable purposes” where permission is not required. These are research, private study, education, parody, satire, criticism, review, and news reporting. But not just any permissionless use that falls into these categories is necessarily “fair”. Other factors figure into a fairness evaluation, including the amount of the work copied, the use to which the copies are to be put, the nature of the work, the alternatives available, and the impact of the dealing on the work, i.e. whether the copying might have a detrimental effect on potential sales of the originals. These must be weighed to determine if a use not authorized by the rights-holder is legal (fair).

From the above criteria, which are drawn from the six factors to be considered when adjudicating fair dealing outlined by the Supreme Court of Canada in the CCH v Law Society copyright case in 2004, (which in turn resemble the four fair use factors used by US courts), you might conclude that an unauthorized use that (a) involved extensive or even total copying of a work that had been (b) produced explicitly for a particular educational market, like a work used for instruction in a university course, and which, as a result of the copying, (c) had suffered heavy damage to its sales potential even though (d) the work, as a readily available commercial alternative, could be easily purchased or licensed, would not meet the bar for fair dealing, even though it fell within a specified exception such as education. If this is your view, you will be at odds with most if not all of the folks from the Association of Research Libraries who are bringing you fair dealing week in Canada.

Even though this hypothetical work may have been copied, chapter by chapter, in its entirety by different professors for different courses, and even though the sale of copies of this specialized work to students by the university effectively demolishes any commercial market for the work, Universities Canada has declared this to be fair dealing in their view. As a result, most of its members, notoriously including York University, have decided to avoid any payment to rights-holders, refusing to obtain a licence from Access Copyright, the collective that represents authors and publishers, or in many cases to license the works directly from rightsholders. This has resulted in a long-running lawsuit that has pitted Access Copyright against York. While parts of this lawsuit were decided by the Supreme Court of Canada in July of last year, the fair dealing issue remains unclear. 

If it’s all a bit arcane to the casual reader, I will try to summarize. Universities and school boards, prior to 2011-12, used to obtain a licence from Access Copyright (AC) allowing them to copy materials in AC’s repertoire (i.e. AC had signed an agreement with the copyright owner, either an author or publisher, allowing it to license the works of the rights-holder and collect royalties on their behalf. These works then went into AC’s “repertoire”). The cost of the licence was based on estimates of the amount of copying occurring during instruction over a given period of time. The licence did not allow for unlimited copying, only copying within specified limits, such as up to ten percent of a work, one chapter in a book, one article in a magazine etc. Copying beyond those limits required further permissions. The licence was based on a per capita cost per student. At one time the fee per university student per year was $26. It is considerably less now due to market pressure to reduce licence fees as a result of the expansion of fair dealing to encompass education.

Under this licensing system, if AC and the users could not agree on a royalty fee, the issue was punted to the Copyright Board of Canada to set a “tariff”. The Board held hearings to determine a fair and equitable royalty rate for post-secondary copying covered under the tariff. Once the Board approved the tariff, it was accepted that it was applicable to all those who used material held in AC’s repertoire unless they had reached their own licensing agreement with the copyright collective. This was the situation that prevailed until about ten years ago. Then it all began to unravel.

In 2012 the Supreme Court of Canada, in a case known as Alberta (Education) v. Canadian Copyright Licensing Agency (Access Copyright),ruled that the allowable purposes of “research and private study” should be given a “large and liberal interpretation” in the context of practices prevailing at the time (i.e. teachers copying materials for classroom instruction). In effect, this meant that if a teacher copied short excerpts of materials for use in classroom instruction to supplement the primary textbook, this was an allowable fair dealing because the teacher was exercising, on behalf of students, their “research and private study” rights. That same year the Copyright Modernization Act was passed adding “education” to allowable purposes under fair dealing . As a result of that legislation, Universities Canada backed out of an agreement on a new model licence with AC that would have resolved the issue of institutional copying and updated copyright guidelines for the digital age. The stage was set for a lawsuit to try to settle the issue. When York University refused to pay the interim tariff established by the Copyright Board, AC sued. York’s position was that it had no obligation to pay because its use was either covered by fair dealing, as exemplified by its Fair Dealing Guidelines applicable to students and faculty, or was already licensed.

Round One went to AC in 2017. The Federal Court ruled that York was obliged to pay the “mandatory tariff”, and that York’s use was unfair. It is worth quoting some excerpts from the judgement regarding York’s supposed fair dealing;

(Para 14) “York`s own Fair Dealing Guidelines (Guidelines) are not fair in either their terms or their application”

(Para 20) “The fact that the Guidelines could allow for copying of up to 100% of the work of a particular author, so long as the copying was divided up between courses, indicates that the Guidelines are arbitrary and are not soundly based in principle”

(Para 25) “It is almost axiomatic that allowing universities to copy for free that which they previously paid for would have a direct and adverse effect on writers and publishers”

(Paras 28 and 245) “The complete abrogation of any meaningful effort to ensure compliance with the Guidelines—as if the Guidelines put copyright compliance on autopilot—underscores the unfairness…York`s approach to these copyright infringing actions is consistent with its wilfully blind approach to ensuring compliance with copyright obligations, whether under the Interim Tariff or under the Fair Dealing Guidelines”

(Para 272) “It is evident that York created the Guidelines and operated under them primarily to obtain for free that which they had previously paid for”

(Para 353) “the Guidelines have caused and will cause material negative impacts on the market for which Access would otherwise have been compensated for York’s copying”.

That is all very clear. York’s dealing was not fair. York appealed but this time based its arguments on challenging the mandatory nature of the Copyright Board’s tariff (interim or not). This time they were more successful. The Federal Court of Appeal (FCA) ruled that, based on historical precedent and close reading of the 1988 and 1997 legislation, the tariff was not mandatory when applied to a user even if the user was continuing to make use of works covered by the tariff. This somewhat bizarre and unexpected interpretation undermined the basis of collective licensing in Canada and was appealed by AC to the Supreme Court of Canada (SCC). While negating the mandatory nature of the tariff, the FCA nonetheless upheld the Federal Court’s decision on the fair dealing issue. While the FCA confirmed that York’s copying guidelines were not fair, AC was left with no recourse since it does not have the requisite rights to maintain a copyright infringement lawsuit. While AC collects royalties for rights-holders, it is not a rights-holder itself. Therefore, if a fair dealing case is to come to trial, it has to be launched by a rights-holder. This means that individual rights-holders are required to bring suit for individual infractions against multiple universities, an impossible and nonsensical situation considering the requirements for documentation, which is why collective licensing was established in the first place.

With the Federal Court of Appeal having blown a hole in the fabric of collective licensing by ruling that mandatory tariffs were not binding insofar as users were concerned, the damage was compounded by the Supreme Court when it upheld the FCA’s decision on the (non) mandatory nature of tariffs. With respect to fair dealing, the Supreme Court did not issue a ruling, considering the question moot since York had no obligation to pay the tariff established by the Copyright Board. But the SCC did not stop there. After dismissing AC’s appeal on the mandatory tariff question, Mme. Justice Abella, in delivering the decision, editorialized on the lower court’s earlier ruling regarding York’s Guidelines. While declining to endorse York’s request to declare that its Guidelines were fair, writing for the Court, she noted;

(Para 87) “this should not be construed as endorsing the reasoning of the Federal Court and Federal Court of Appeal on the fair dealing issue. There are some significant jurisprudential problems with those aspects of their judgments that warrant comment.”

Although the SCC refused to issue a Declaratory Statement legitimizing the Guidelines, and although she recognized that the SCC was not retrying the fair dealing aspects of the case, Justice Abella then proceeded to cast doubt on the original fair dealing decision against York. She commented that the Federal Court had looked at infringement only from the institution’s perspective and had failed to take into account the user’s right of individual students. This commentary, known in legal circles as obiter dicta, is not binding on future courts but is potentially damaging if and when a fair dealing case is brought by a rights-holder against York or any other educational institution. This will cast yet more doubt on what is–and is not–a fair dealing when it comes to educational copying.

There is no question that the current very broad interpretation of fair dealing in Canada has caused immense damage to the Canadian publishing industry and has lined the pockets of educational institutions at the expense of authors and creators. Instead of spending hundreds of thousands of dollars fighting the representative of authors and publishers in court, and spending millions more to hire additional staff to screen and vet copyright compliance, York and other universities in English Canada could have simply acquired a licence from Access Copyright, as the universities in Quebec have done with respect to AC’s Quebec counterpart, Copibec. The current tariff set by the Copyright Board is $14.31 per student or less than .0004% of the average annual cost per student, amounting to less than four cents a day per student.

There is nothing “fair” about the actions taken by York or the other institutions that have refused to compensate authors and publishers for using their works by prying open the fair dealing exception to the fullest extent possible, aided and abetted to date by the Supreme Court of Canada. The universities should do the sensible (and “right”) thing and license the content they are using for instruction. With the Supreme Court having allowed the gutting of the Canadian educational publishing market, it is incumbent on Parliament to re-introduce some balance. It can do this, as recommended in 2019 by the Standing Committee on Canadian Heritage, by limiting the education fair dealing exception–when applied to educational institutions–to circumstances when the work is not commercially available. The Committee also recommended that the Government of Canada promote a return to licensing through collective societies. To do this, legislation will be required to fix the anomaly of mandatory tariffs that are mandatory only for one of the parties, (licensors), but not on users, thereby restoring the viability of collective licensing in the publishing sector in Canada.  That would bring some fairness to fair dealing in Canada and would be something to celebrate during fair dealing week next year.

© Hugh Stephens 2022, All Rights Reserved.

Copyrighting the Ogopogo: The © Story Behind the News Story

The headline in the local paper grabbed my attention. City of Vernon transfers copyright to legendary Ogopogo to B.C. Indigenous nations. It went on to say that “The legal rights to the legendary creature in a British Columbia lake have been transferred to an alliance of Indigenous nations who say the Ogopogo has always been part of their spiritual teachings.” Well, that’s probably as it should be, and is fully consistent with the spirit of reconciliation with First Nations that is epitomized by the establishment of a new public holiday in Canada, Reconciliation Day. (September 30). But hang on a minute. How could the City of Vernon (a community of about 40,000 located near the north end of Okanagan Lake) own the rights to a mythical lake monster? I mean, you can’t copyright the Ogopogo any more than you can copyright the Loch Ness Monster, the Sasquatch or the Yeti, the unicorn or any one of a host of other imaginary creatures. You can’t copyright an idea, only the expression of an idea.

No-one would be surprised to learn that imaginary creatures like Godzilla, The Hulk and Superman are protected by copyright and trademark registrations, since they were conjured out of thin air by their creators. (Japanese film producer Tomoyuki Tanaka in the case of Godzilla, writer Stan Lee and artist Jack Kirby in the Hulk’s case and Jerry Siegel and artist Joe Shuster for Superman). They didn’t “exist” (in peoples’ minds) until their creators put them in concrete form, through films, artwork, comic books etc. The copyright on the creation was then sold and commercialized.  But what about other imaginary or mythical creatures such as sea monsters, denizens of deep lakes and various bizarre and unproven forms of life otherwise known as cryptids, such as the Ogopogo, passed on by legend and oral tradition? Surely it would be impossible to copyright them—and by extension have the right to license the concept of the creature and in turn prevent others from using it without authorization.

While I could understand that Vernon wanted to give whatever IP (intellectual property) rights that it held in the Ogopogo to the Okanagan Nation Alliance–representing indigenous groups in the Okanagan region–as a gesture of reconciliation, the copyright nerd in me came out. I was itching to find out exactly what it was that the City had transferred. Perhaps it wasn’t a copyright after all, but a trademark registration that was transferred? In a CBC report published back in March when the story first broke, there is reference to transfer of both copyright–in the text–and trademark–in an embedded interview with Okanagan Indian Band Chief Byron Louis. Maybe the journalist mixed up the two, but a trademark registration on the Ogopogo appeared to be a logical conclusion. I began my search, and eventually, with the help of staff at the City of Vernon, Jadon Dick of the Okanagan Publishing House, and the Canadian Intellectual Property Office, I think I have solved the mystery. Read on.

The press reports covering the story reported that the copyright had originally been registered in 1953 by Arthur “Gil” Seabrook, a local broadcaster, as a promotion. I suspect he wanted to “one-up” the neighbouring City of Kelowna, located 50 kilometres to the south of Vernon, and lay claim in some way to the lake creature. Kelowna’s waterfront has, since 1960, sported a large concrete sculpture of the Ogopogo, and is a popular tourist attraction. Clearly Kelowna was not deterred by Seabrook’s supposed copyright on the mythical monster. It was reported that in 1956 Seabrook assigned his rights to the City of Vernon, substantiating the supposition that this was all about civic rivalry. Seabrook lived a long life and passed away in 2010 at the age of 97. His obituary, published in the Vernon News, says that;

At one point, as a marketing / promotion effort, he personally obtained the registered trade-mark for the word “Ogopogo” and an artistic rendering of the famed lake monster. This, much to the chagrin of Kelowna and other Okanagan cities. Eventually the rights to use “Ogopogo” were offered to the City of Vernon … where they basically remained dormant”. Ah, the smoking gun (or so I thought).

I decided to search the Canadian Trademark Database for information as to what was registered under Ogopogo. I found 17 entries for use of various forms of Ogopogo related to a range of product categories, from books to wine to chocolates, to suntan products, clothing, and soft drinks. There are also many other businesses in the region that use the name Ogopogo without registering it, e.g. Ogopogo Giftland, Ogopogo Lawn Sprinklers, the Ogopogo Motel, and so on.  Registered trademarks must be associated with a specific product category and must be renewed every ten years. Many of the registered marks had lapsed due to non-renewal, and none were in the name of the City of Vernon. I thought it unlikely that Vernon would have renewed their trademark registration—at a cost to the taxpayer of around $500 net of legal fees—every ten years, so perhaps it wasn’t a trademark registration after all. So, what was it? It was time to search the Copyright Database maintained by the Canadian Intellectual Property Office (CIPO).

I found 18 listings for registered copyrighted works related to the Ogopogo. They included books, posters, artwork, videos (in some cases, supposedly of the creature itself) and dramatic works. However, it is not compulsory to register a copyright. The mere act of creation and fixation (embodiment in concrete form, such as publication, a photograph, a painting etc.) is sufficient, so I have no doubt that there are many more works out there based on the Ogopogo that are subject to copyright protection that have not been registered. And then there is the fact that the online database only goes back to 1991. What about Gil Seabrook’s registration? What did he register? I asked the CIPO if they could confirm what was registered.

They responded, but not very helpfully.

“The Copyright Office does not conduct searches for clients. The Canadian Copyrights database will allow you to search all of the Canadian copyrights registered from October 1991 to present day, free of charge…Registrations prior to October 1, 1991 and dating back to 1841 cannot be searched online. They are stored in the public search room of the CIPO Client Service Centre. You may wish to visit the Client Service Centre or hire a freelance searcher to search on your behalf…You can also hire a registered trade-mark agent to conduct a search on your behalf. Open Monday to Friday (except statutory holidays) from 9:00 a.m. to 4:00 p.m. (Eastern Time) on appointment only.

It should also be noted that copies of the works themselves are not part of the records kept at the CIPO. The Copyright Register only contains information such as the names of the authors and owners, the titles and categories of works, registration dates and grants of interest.”

That’s great if you are a resident of Ottawa. Even then, if you found the 1953 registration, it still wouldn’t tell you what was registered.

Now remember that Gil Seabrook’s obituary had said that after he had transferred the “trademark” on Ogopogo to the City of Vernon, it had remained dormant. That is mostly, but not entirely, true, and this is why we are discussing this issue today. Back in 1984, a local author, Don Levers, was writing a children’s book called “Ogopogo-The Misunderstood Lake Monster”. It was self-published and sold over 25,000 copies. It seems that Mr. Levers had heard stories about the City of Vernon owning the copyright on Ogopogo, so he played safe and asked the City’s permission to publish his book. It was freely granted, subject to acknowledgement in the book. Fast forward to March, 2021 and Mr. Levers has decided to publish a sequel. Once again he, along with his publisher, Okanagan Publishing, approached Council for permission to use the word. Press reports stated he required Council’s permission “because the city has the copyright to the word Ogopogo”. Once again, Council agreed, provided that Levers acknowledged the City in a prominent and suitable location. He agreed to do so, but that is when the reconciliation issue came to the fore.

Vernon’s heretofore long-forgotten and dormant copyright ownership suddenly was put in the spotlight. Questions were raised about why the City held title to the name Ogopogo, when it was based on a native legend. After all, didn’t the Syilx First Nation really “own” Ogopogo? There were murmurings of “cultural appropriation”. The Guardian picked up the story, framing it as an indigenous nation trying to reclaim its culture. That is when Council voted to relinquish its copyright and assign it to the Okanagan Nation Alliance, which was happy to receive it. The Globe and Mail reported that “For $1, council voted to assign and transfer to the Okanagan Nation Alliance all copyright, title, interest and property including trademark rights arising from the commercial and non-commercial use of the Ogopogo name”.

Except that is not exactly what happened. The City of Vernon Council Minutes for October 12 make it clear that what Vernon transferred to the Okanagan Nation was;

“all copyright, title, interest, and property in the Work, (emphasis added) together with the right and title to any derivative works arising in any way from the Work, and any trademark rights arising from the commercial or non-commercial use of the foregoing copyrighted protected works or derivates thereof and any goodwill related thereto, without reservation or exclusion, together with all profit, benefit, and advantage that may arise from printing, reprinting, or selling said copyrights for the remaining term of the copyright”.

What was transferred were the rights to “the Work”, not the name Ogopogo. But what was the work? It was registered under Copyright #102327 on June 9, 1953, but we may never know what it actually was. The original copyright certificate, kindly provided by the City of Vernon (see below), simply says that Seabrook registered an “unpublished literary and artistic work entitled Ogopogo”. An unpublished work can be copyrighted as long as it is “fixed”, but since it was unpublished, it may no longer exist, and as CIPO made clear, when a work is registered no copies of the work itself are retained.  Certainly, the City of Vernon appears to have no idea of what the work contains nor, it appears, does anyone else. Seabrook is no longer around to ask.

I asked Jadon Dick, founder of Okanagan Publishing (Levers’ publisher) why he and Levers approached Vernon to clear the copyright when multiple books have been published about the Ogopogo without doing so. All that Vernon owned was copyright to an unpublished work. Mr. Dick replied that he had not known about Vernon’s copyright before speaking to Levers. His impression was that in the view of the CIPO, the name Ogopogo was not copyrighted (this is not surprising, since a name cannot be copyrighted) but since Levers had got Vernon’s approval the first time around, it seemed to make sense to ask for approval for the sequel. As publisher, he wanted to cover all the bases. He felt that if Vernon had some form of copyright, even though it was not enforcing it, it would be better to have permission before moving forward with the book, rather than have a controversy later which might negatively affect sales and marketing. This was “due diligence” at its best. It was only after they approached Vernon, and winkled out the old copyright document, (and got permission from the City to use the word Ogopogo, which technically they had no right to grant) that they realized the nature of the copyright and that no permission was in fact required. Nothing in Seabrook’s earlier unpublished work was used, and Dick has no idea what that work consists of. The copyright approval request could have become a non-issue but by this time, the reconciliation train had left the station.

Dick goes on to say that the Ogopogo copyright is more symbolic than anything else, and that despite all this, the gifting of the copyright to the Okanagan Nation Alliance is a symbol of giving back control of the Okanagan Lake Creature.

“Okanagan Publishing House is/was pleased to hear that the City of Vernon gave the Ogopogo copyright to the Okanagan Nation Alliance. We see it as a broader movement to give back control of the Okanagan Lake Creature and how we speak about the Nx̌ax̌aitkʷ/Ogopogo to the Indigenous people of this area. This is something that we seek to do in all of our publications.”

So that solves the mystery of the City of Vernon’s copyright. If Levers had not, in an excess of zeal in 1984, sought permission to use the name, the issue would not have come up in 2021. The whole question of cultural appropriation is seen very differently 35 years later. Although Vernon never had the copyright to the name Ogopogo, the assignment of the name makes a good hook for a story about reconciliation. The Okanagan Nation saw the City of Vernon’s actions as “respectful”, even if what they actually got, for $1, were the rights to an unpublished work. But more important, they got recognition of the fact that the lake creature is indelibly linked to their traditional culture, and an acceptance that they should have some say over it.

However, I cannot resist adding one final, ironic point regarding the name Ogopogo. Although native groups had an oral tradition of a lake creature, it had an entirely different name. It was known as N’ha-a-itk and was probably never considered by the original peoples as an actual creature but rather the spirit of the lake, much as certain geographical features are imbued with spiritual meaning by Indigenous groups.

The name Ogopogo was actually conferred by tourism officials in the 1920s and drawn from an old  English music hall song (listen here), whose lyrics included;

“I’m looking for the Ogo-pogo, The funny little Ogo-pogo.

His mother was a polliwog, his father was a whale,

I’m going to put a little bit of salt on his tail.

I want to find the Ogo-pogo”  

That, at least, is the version published by the BBC

The N’ha-a-itk of the Syilix and the Ogopogo that was labelled by officials keen to promote tourism have become very different things, although springing originally from the same source. You can’t put that genie back in the bottle. For better or for worse, the well-known Ogopogo name and image will no doubt continue to adorn pop and wine bottles, boxes of chocolates, motels and RV parks, bed and breakfast establishments, a stucco and masonry business, a gymnasium, a moving and storage outfit—even an air cadet squadron, and will continue to feature in books, plays, and artwork.

If Vernon didn’t hold the copyright to the name Ogopogo, then the Okanagan Nation Alliance (ONA) doesn’t either despite the assignment of whatever rights Vernon had–or thought it had. People remain free to continue to express their own idea of what the Lake Okanagan water spirit is, what its characteristics are and to tell stories about it. And they can continue to copyright those artistic expressions and creations, but hopefully will do so in a way that is respectful of the creature’s cultural connotations.

At the end of the day, this story is not really about copyright. It is about reconciliation and respect. It was an appropriate decision for Vernon City Council to turn over its “rights” to the First Nations of the area. Vernon’s gesture of reconciliation—regardless of whether it actually involved transfer of copyright over the Ogopogo name or not—will remain a symbolic token of goodwill and a reaching out to First Nations groups that seems to have been well appreciated by the recipients.

© Hugh Stephens, 2022. All Rights Reserved.

Books, e-Books, Authors, Publishers and Libraries: A Complex Relationship

On January 1, 2022, a new law entered into force in the state of Maryland requiring that authors and publishers holding the rights to an e-book title must offer unlimited copies of that title to public libraries in the state at an undetermined “reasonable price” if and when the title is offered to individual consumers. This law puts Maryland’s heavy thumb on the scale of copyright, subjecting e-book rights-holders to a “compulsory licence” thus depriving them of the right to decide when, where and how to release works to which they hold the rights. The law is opposed by the American Association of Publishers (AAP), the Authors Guild and industry associations representing music publishers, newspaper publishers and the motion picture industry for fear that if compulsory licensing is accepted for e-books, their sectors could be next. It is supported by the Maryland Library Association among other groups advocating for the library community.

The AAP is seeking an injunction to stay implementation of the state legislation on the grounds that it usurps federal copyright law. Maryland claims jurisdiction on the grounds of contract law. A court hearing on the injunction was held earlier this week, on February 7. According to the judge hearing the case, the decision will come “soon” (likely one or two weeks). Maryland’s actions, which are being echoed by several other states including New York, Rhode Island, Illinois, Missouri and Massachusetts, have scrambled the complex (and mutually beneficial) relationship that has prevailed for many years between authors, publishers and libraries, this time with a particular focus on e-books. Let’s look briefly at the history of that relationship.

In the beginning there were manuscripts, those beautiful, hand-crafted documents laboriously produced by skilled craftsmen (yes, I think they were likely all men, probably with tonsures) in the Middle Ages. Then along came Mr. Gutenberg with his introduction to Europe of movable type. (Contrary to popular belief, Gutenberg did not invent type; that honour belongs to the Chinese who were printing, and even using movable type some 500 years before Gutenberg. What else did the Chinese invent? Why golf of course!). The Koreans and the Mongols also used movable type a couple of centuries before Gutenberg. However, it was Gutenberg who popularized the technology and his creation led to an explosion of printed works. This, in turn, led to various disputes over who had the right to print what. Various monopolies were awarded to various printers in various countries, but invariably someone who was not awarded a printing licence decided to do so anyway. Naturally this led to disputes, the passing of laws to regulate printing and finally, in 1710, what has become known as the first modern copyright law, the Statute of Anne in Britain which gave the reproduction right to authors rather than printers or publishers.

Since Gutenberg’s time there have been many advances in printing and publishing, but the principle of reproduction rights remained more or less the same, with the end product being a book in physical format. It may have been printed on vellum and bound in leather or printed on cheap paper with just a paper cover, but it was a work the purchaser could pick up and hold and put on their bookshelf. Or it could be purchased by a library and put on the shelf of a library for loan. And while the purchaser could not infringe copyright by reproducing the book, they owned it and were free to do with it what they wished-resell it, lend it to a friend, keep it, trash it—the choice was theirs, subject to parallel import regulations in some countries. (In the US, this is known as the ”first sale doctrine”.)

The connection between printed books and libraries is a long one. When the Statute of Anne was passed, one of the requirements for a work to enjoy copyright protection was that “nine copies of each book or books, upon the best paper” shall be delivered to the warehouse of the Company of Stationers for the use of the royal library and the libraries of the major universities in England and Scotland. This act of deposit is replicated today in the United States by the mandatory deposit requirements of the US Copyright Office. “This law requires that two copies of the best edition of every copyrightable work published in the United States be sent to the Copyright Office within three months of publication. Works deposited under this law are for the use of the Library of Congress.” Most countries where there is a significant publishing industry have similar requirements. In Canada, Canadian publishers are required to make two copies of books published in Canada available to the National Library under the Legal Deposit Program of the Library and Archives of Canada Act (2004).

If copyright, books, and libraries have a long and close connection, so too do authors, publishers, and librarians. Without authors and publishers, the raison d’être for libraries would disappear, even though today libraries have become much more than places for just the circulation of books. In addition to their collections of audio-visual materials, they are in many cases also quasi-community centres where clients access the internet (and through the internet reach government services and other sources of information), have their pre-schoolers entertained with story-time, as well as, in some cases, simply to gather to study, socialize or keep warm.

Most authors love libraries, understanding that they are essential tools in the promotion of literacy and love of books. There are exceptions, as I wrote about here (“Are Libraries the Enemy of Authors and Publishers?”). Canadian publisher Kenneth Whyte launched a diatribe against public libraries, accusing them of undercutting book sales by “pimping free entertainment to people who can afford it”. Whyte’s crusade fell flat and he was promptly disavowed by the mainstream publishing business. The Executive Director of the Association of Canadian Publishers wrote, “Canadian publishers recognize that libraries are an important part of the reading ecosystem and a primary channel for book discovery…Library sales are also an important part of the publishing business model”. It’s also worth noting that in Canada, Australia, New Zealand and the UK (but not in the US), in addition to earning royalties on sales of books to libraries, authors generate revenue when their books are loaned out by libraries through the “public lending right”.

While authors and publishers profess to love libraries, the reverse does not always seem to be true. Some librarians are in the forefront of attempts to weaken copyright laws, the framework that authors depend on to earn a living. I recently reported on the situation in New Zealand, (“Why is New Zealand’s National Library Declaring War on Authors”) where the National Library unilaterally decided to “donate” hundreds of thousands of books, including many under copyright, to the controversial Internet Archive (IA) in the US. (After a major hue and cry from New Zealand authors, the National Library finally backed down and cancelled the “donation”). The IA is the sponsor of the very contentious “Controlled Digital Lending” (CDL) concept. The way CDL works is the following. A library buys a book (or several copies of a book). Rather than lending the book, it scans it (digitally copies it). It then places the physical book, or books, in storage, and instead lends out the digital copy or copies. In this way, it is argued that CDL respects the established rules around library lending, i.e. a book cannot be loaned to a different client until it has been returned by the first borrower. In the case of digital copies, no further lending occurs until the original loan is over. In the case of a physical book, it would be returned to the library; with a digital work, the copy expires on the reading device.

There are two major problems with the CDL concept from the perspective of authors and publishers. The first is that in 2020 the Archive unilaterally decided to abrogate its own self-declared CDL rules and instead suspended the limitation on lending. It decided to loan out unlimited copies regardless of the number of original works in the library’s holdings. Using COVID-19 as the excuse, the Archive declared that it was establishing a “National Emergency Library”. After a brief moment when the media jumped in and applauded the initiative, suddenly most people realized that the organization was making fast and loose with other peoples’ property. Even if they had the right to lend digital copies under the CDL theory, which is far from a sure thing, suspending CDL to lend unlimited copies was a step too far. Even though the IA quickly backed down, its actions provoked a lawsuit from the publishing industry challenging not only the National Emergency Library but CDL itself. That case is still unresolved.

The second problem is that making a digital copy of a work conflicts with the exploitation of digital rights held by authors and publishers. A scanned copy of a physical work is different from a licensed digital edition of a work (an e-book), yet it can directly interfere with the market for the latter. The purchaser of a hard copy book does not acquire the digital rights by virtue of that purchase. E-books come with their own rights and licensing conditions, just as audio-books do. Even though the content may be the same, they are different products. Watching a film of an opera performed at La Scala and attending a performance at La Scala are two very different things, even though the two productions have the same music, same costumes and same libretto.

E-books have been developed and made available to the public—and to libraries—under specific licensing conditions.  E-books are popular with library clients because downloading a book is so much easier than making a trip to the library to get the book, and then another to return it, especially during the pandemic, and then maybe paying a fine because the book is late.  As a result, libraries have got into the e-book business in a big way, often licensing multiple copies of a work (under terms where they pay more per copy than an individual user would), and then lending out these e-copies to borrowers.

The terms for licensing to libraries usually differ from the terms offered to individuals. As I mentioned, the cost per copy is usually several times higher than an individual licence, and the licence may sunset and need to be renewed after a set period of time (e.g two years), or after the work has gone out on loan a specified number of times. In addition, some publishers of e-books have exercised their rights to limit the number of copies sold to a library, or to hold back licensing the book for a short period of time in order not to cannibalize the market for sales (licensing) to individual readers. This is similar in concept to the “windowing” strategy used by major film studios whereby the DVD or streaming release of a film is held back for several weeks while the film plays in cinemas.

Many libraries and librarians don’t like these licensing terms, and some are pushing to have e-books treated identically with hard copy books. In other words, from their perspective, you should be able to purchase an e-book rather than licence it, and once you have purchased it, the buyer—a library or anyone else—should be able to do anything they want with it other than copy it, just as with a hard-copy book.

This position fails to understand the difference between books and e-books, especially in the library context. E-books have eliminated all the “friction” that accompanies the act of borrowing a book from a library for the consumer such as physically visiting the library at least twice, and maybe paying a fine if overdue. Because a library cannot hold infinite numbers of copies, popular titles are often out on loan and readers need to reserve them. These “friction factors” offset the free cost of borrowing for readers and persuade many consumers that it would be better to buy the book and avoid the hassle. This was a trade-off that generally worked well for libraries, publishers, booksellers and the public. Moreover, a popular edition of a hardcopy book at a library will need to be replaced after a certain number of loans, usually around 50, because of wear and tear. However, with an e-edition all friction disappears, and the digital copy can be loaned indefinitely with no need for replacement, ever. That is why publishers have had to move to a licensing model for e-books. They are dealing with a different product requiring different management and marketing.

This reality has not deterred some in the library community from pushing to have e-books treated exactly the same as physical works. In the US a spate of legislative initiatives has been launched at the state level to, in effect, hijack the rights of e-book publishers and subject e-books to compulsory licensing for library use. As mentioned at the beginning of this blog post, draft legislation has come forward in New York, Maryland, Rhode Island, Massachusetts and elsewhere to require publishers to license e-books to libraries at “reasonable rates”, with rate-setting ultimately being determined by the courts if there is no agreement. New York’s legislation was vetoed by Governor Kathy Hochul on the grounds that it intruded into the domain of federal copyright law, but Maryland’s statute has been enacted. We will have to wait to see if the AAP’s legal challenge is upheld.  

What has prompted this legislation now? Most publishers license digital editions to libraries at the same time that a work is released to the public, but there are exceptions. Amazon (not a member of the AAP, by the way) is one, but they are not the only publisher to express concern over the impact of widespread library e-lending on sales of e-books. Back in 2019, MacMillan’s CEO John Sargent expressed concern that “the very rapid increase in the reading of borrowed e-books decreases the perceived economic value of a book…causing book-buying customers to change habits“. According to Sargent, this was creating a problem across the publishing ecosystem. MacMillan’s proposed solution was to limit each library to one copy of an e-title for the first eight weeks of release before licensing additional copies to a library. This would not prevent borrowers from accessing the work, but most of them would likely have to wait in line for their turn, one of the prices to be paid for getting a newly-released work through a library. Of course, they had an alternative; they could go and directly “buy” their own digital copy right away. This strikes me as a not unreasonable compromise, but there was still a strong pushback from the library community. Then, in the early days of the COVID pandemic in March 2020, MacMillan suddenly reversed its policy. The plight of libraries that had to close their doors to the public and go online may have been a factor in MacMillan’s reconsideration.

This underlines the symbiotic relationship between authors, publishers, and libraries. For authors to be able to continue to create new works, they need a healthy publishing sector to get their works to the public, through booksellers and libraries. Libraries need a viable publishing sector to be able to provide their clients with new works. If publishers of e-books need to tweak or experiment with various market models in order to stay in business, that is their right and is subject to negotiation with their customers, including libraries. But what is happening in Maryland, and in other states where legislation is being developed to impose compulsory licences on publishers, is a concerted attempt to modify copyright law and strip rights-holders of their distribution rights through a back door mechanism. State legislation that impinges on US federal copyright legislation will undoubtedly be struck down by the courts. However, the protagonists are clearly hoping to build political momentum leading to eventual changes in copyright legislation at the federal level in the US Congress.

This is not just a US issue. International publishers are watching closely to see what happens, as there is potential for impact on titles published outside the United States. Moreover, the Berne Convention, to which the US has belonged since 1989, imposes certain minimum standards designed to protect rights-holders (the “Three Step Test”). Maryland’s legislation would nullify treaty commitments made by the United States Government.

The best solution, and hopefully one that will eventually be arrived at, is for publishers and libraries to work out their differences through licensing negotiations, instead of having libraries trying to tilt the playing field with legislation that abrogates elements of established copyright law. Throughout history copyright law has adapted to changing technology while managing to respect the rights of authors. The advent of the public library in the second half of the 19th century proved to a boon in the promotion of literacy, and the consumption of books. That is still the case, but all parts of the ecosystem need to survive. Licensing is a model that allows authors and publishers to survive in an increasingly digital world. Maintaining the role of libraries while ensuring that booksellers and publishers stay financially healthy is in everyone’s interest. Upsetting the apple cart to unfairly favour libraries over rights-holders is not. That is the current challenge presented by the Maryland legislation.

The complex relationship between authors, publishers, and libraries has worked well over the years, to the benefit of all. There is no reason why the advent of the e-book should undermine this working relationship so long as all parties approach the issue keeping the big picture in mind. All parts of the reading ecosystem need to survive. If authors, publishers and libraries work together, everyone will thrive. And the reading public will be the ultimate beneficiary.

© Hugh Stephens, 2022. All Rights Reserved.

Update: On February 17, the US District Court for Maryland granted a preliminary injunction suspending the Maryland’s e-book licensing law. The AAP statement on the court’s decision is here.

Site Blocking and the Rules of the (Internet) Road

Credit: Kristina Milbourn. Used with permission

I recently attended a very interesting conference originating from Toronto, called Digital Media at the Crossroads, aka DM@X, where discussion and presentations took place on a range of digital media issues in Canada and internationally. Many of the audience were digital media students studying for degrees in Communications. Among the issues discussed was “site blocking”, a widely used technique in many countries to disable access by consumers to offshore websites distributing illegal or infringing content. The presenter, Kristina Milbourn, is a senior lawyer at one of Canada’s large communications companies. What struck me in particular was her analogy to site blocking as being part of the necessary “rules of the road” for navigating the internet. I thought it was an insightful and creative way to present the issue. (See image above).

We often refer to the internet as a “highway”. All highways have rules to which its users are subject, for the common good. We all need to stay on our side of the road, signal when we are making turns or changing directions, obey traffic signs and signals and so on. There will always be a small minority who choose to ignore the rules, to the detriment of the rest of us, and for these people there are sanctions. To ensure that the laws that we all need are enforced, penalties are issued subject to a process where the accused has the opportunity to rebut the charges. The internet is not much different. Site blocking, and its cousin, dynamic blocking injunctions, fit into this framework.

Site blocking is gaining traction in Canada, with the initial site blocking injunction issued by the Federal Court in the GoldTV case having being upheld on appeal. While site blocking has proven to be effective in deterring consumers from accessing copyright infringing content in countries where it is routinely used, such as Australia and the UK, it is less effective in situations where blocking needs to occur in real time. (More on this below). Pirate content sites typically establish themselves in jurisdictions beyond the reach of domestic law precisely to make it difficult for content owners to have them taken down. Sometimes they are ad supported; in other cases they will actually sell “subscriptions” to consumers, offering content that they have not licensed for a price that legitimate competitors could not match. A recent report by AVIA, the Asia Visual Industry Association, noted that illicit streaming websites and apps generate an estimated US$1.34 billion in annual revenues through advertising. Access is provided to consumers through offshore websites, often enabled with codes that are provided to “subscribers”.

The most effective way to stop this practice is to disable consumer access by requiring online service providers (who are, admittedly, innocent third-party actors) to block content at their servers. In many countries, including Canada, this happens through a court order; in some others the order is issued by a regulatory agency. In both cases, there is an identified problem, an application, a review of the facts, and a hearing where evidence is presented, and an opportunity provided for the target website to rebut the claimed infringement. In almost all cases, the respondent (resident offshore) does not contest the application. Most ISPs have found that the process is not particularly onerous and almost all cooperate. It is not irrelevant that some of them are vertically integrated companies and have their own content assets to protect.

The blocking orders are granted to ensure the smooth functioning of the internet highway. They clarify that access to illegal content will not be tolerated, and they impose the necessary blocks to ensure that the rules are respected. These rules of the road are required to protect the integrity of the ecosystem that creates content for consumers. They even help protect the consumer from self-inflicted harm because many pirate websites are also known to spread malicious advertising, spyware and ransomware as part of their “unadvertised” offerings. Using the traffic analogy, these “static” blocking orders are similar to unqualified traffic rules. Stop. Do Not Enter. No Access. They are static in the sense that they target a specific site with a specific blocking order.

The problem with static blocking orders is that they take some time to obtain and can be circumvented by the pirates by moving to a new internet address. It then becomes a game of cat and mouse. While site blocking orders deter most casual users, really determined consumers of infringing content will search for, or wait to be informed of, the new IP address to get their “pirate fix”. This is particularly prevalent in piracy of sports broadcasts, where pirate providers will switch the source of their feed within the game, once blocking begins. The most effective remedy is to follow the path of the pirates and block the new sources in real time. The technical means are available to do this, but the Achilles heel is the need for court approval. It is no small task to document the case for a site blocking order. It must be precise, and the target must be clearly identified. But what happens when the target shifts? Clearly, in a situation of piracy of live sports events there is no time to go back to the court to ask that the order be amended. The answer is to request a dynamic site blocking injunction.

Dynamic injunctions target the content rather than a specific Internet address, thus allowing the blocking order to shift to whatever address the pirated feed is coming from. It has been successfully used in the UK where piracy of English Premier League soccer broadcasts is all too prevalent. In Canada, Bell Media, Rogers Communications and other broadcasters have applied for a dynamic site blocking order to protect their broadcast rights for National Hockey League (NHL) games. That application is still pending before the courts, with a ruling expected early this year. Coming back to our traffic analogy, whereas static site blocking orders require that data packets be blocked according to pre-determined, unqualified criteria, dynamic orders allow data packets to be blocked subject to conditional traffic rules, depending on the time of day and other factors. Instead of a “Stop” sign, it is more akin to a “No Parking between 7 am and 9 am” sign, or one that prevents a left turn between certain hours on certain days. Both have their utility, depending on the nature of the content to be targeted, just as both fixed and conditional traffic rules are necessary to allow us to use the roads safely.

Site blocking is not a new technique although it is relatively new to Canada. Its usefulness goes well beyond disabling access to copyright infringing content. If last year’s discussion is any guide, the new “Online Harms” legislation expected to be introduced shortly in Canada will include site blocking as one of the measures that can be employed to combat harmful and illegal online content, such as promotion of terrorism and sexual exploitation of minors. Some complain that any blocking of content online is a violation of net neutrality and plays into the hands of autocratic regimes by legitimizing blocking of content. Neither of these arguments is convincing, in my view.

Net neutrality is a principle in which online service providers, who perform a role similar to “common carriers”, should avoid discriminating against or favouring some content or communications over others, particularly with respect to content in which they have a commercial interest. It does not mean that they have an obligation to transmit illegal content any more than the telephone company is obligated to put through calls that a subscriber wants blocked. As for the argument “If we do it, this gives the Chinese licence to do it”, I would make two points. First, the Chinese don’t need any western examples to erect the “Great Firewall of China”. They are masters at it and have already done it. Second, any targeted blocking in western countries is governed by transparent rules overseen either by the courts or independent regulatory agencies, with all kinds of due process built into the system. The same is clearly not true in China or in other jurisdictions that unilaterally decide to block outside content. We need to deal with real problems present in our economies, and not worry unduly about the supposed precedential effect.

While site blocking is becoming a regularly used tool in many countries, surprisingly it is absent in the United States, largely as a result of the misinformed campaign back in 2012 to “Stop SOPA”. SOPA was a piece of draft US legislation (Stop Online Piracy Act) that opponents claimed would have allowed “Hollywood” to censor the internet. All sorts of dire predictions were circulated, including chilling user-generated content, overreach by law enforcement, the demise of e-commerce and technical infeasibility. It was even claimed that SOPA would “break the internet”! On January 18, 2012, a large number of websites, including Wikipedia and Google, went dark during “Blackout Day” to illustrate the purported threat. Legislation that had enjoyed widespread support from lawmakers suddenly became toxic. Members of Congress ran for cover. The legislation was dead and buried, never (so far) to return. The fact that site blocking has been implemented in over 35 countries around the world, and yet the internet is still working (the last time I checked), is proof of the wild-eyed hyperbole that was flung around by opponents of the legislation.

The absence in the US of the kind of rules of the road that have worked so well elsewhere has made it more difficult to combat piracy in the United States. According to a recent study by MUSO, reported in Dataprot, the US is the world’s biggest source of illegal online downloads, almost 28 billion, (followed by Brazil and India), many of them from offshore sites. Targetted, transparent, court-sanctioned site blocking would surely help tackle this widespread problem. A very recent study (January 26, 2022) by the Information Technology and Innovation Foundation (ITIF),  a Washington DC based non-partisan think-tank, has argued that A Decade After SOPA/PIPA, It’s Time to Revisit Website Blocking”. The ITIF study documents the success of site-blocking in combatting online piracy in numerous countries around the world, and concludes with a series of recommendations for US lawmakers.

Meanwhile, back in Canada, we’ll have to await the results of the court deliberations on the dynamic blocking orders for hockey games and should soon see what blocking mechanisms are included in the Online Harms legislation. New rules of the road.

Site blocking is helping to maintain good order on the roads and prevent the mass transport of illegal goods over the internet highway. Like the highway code, properly regulated site blocking is to everyone’s benefit (except the offshore pirates). But let’s not worry about that. After all, the rules were made to protect those who contribute to society, not those who rip it off.

© Hugh Stephens, 2022. All rights reserved.

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