Copyright – Page 10 – Hugh Stephens Blog

Canada is not the United States when it comes to Copyright: The Cases of Anne of Green Gables and Steamboat Willie (or Down the Copyright Rabbithole, Twice)

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Canada not the US when it comes to copyright—or anything else. This should be a statement of the obvious, but in fact all too often Canadians get confused about how copyright (and other) laws work in this country because of the overwhelming influence of US entertainment and, to a lesser extent, US media content in Canada. For example, during the truckers convoy to Ottawa a couple of years ago, some of those arrested protested that they weren’t read their “Miranda rights”. (Right to remain silent, etc). They’d been watching too much US television. Miranda rights do not apply in Canada although Canada does have similar “Charter rights” that include the right to be informed of the alleged offence and the right to counsel. Likewise, in the area of copyright, Canadians will often refer to “fair use”, even though the US fair use doctrine does not apply in Canada. In particular, the application of a “transformation” test by US courts as one consideration in determining fair use has no applicability in Canadian law. Just as Canada has a similar but not identical concept to Miranda rights, it also has user exceptions to copyright through the fair dealing exceptions specified in the Copyright Act. However, while there are many similarities, fair dealing and fair use have some important differences, in Canada as elsewhere.

The Public Domain in Canada and the US: Not the Same

Yet one more important difference between Canada and the US is the date on which copyright protection expires, allowing various works to fall into the public domain. Although the term of copyright protection in Canada is now “life of the author plus 70 years”, the same as in the US since the extension of Canada’s term of protection at the end of 2022 as a result of commitments Canada made in the CUSMA/USMCA, there are still many works protected by copyright in the US that are in the public domain in Canada. This is primarily because of Canada’s shorter “life plus 50 year term” that was in force for many years until the recent change. The extension of copyright protection in Canada in 2022 does not apply retroactively to works already in the public domain. A few years ago I wrote a blog post about F. Scott Fitzgerald’s The Great Gatsby, recounting how it was in the public domain in Canada yet still under copyright protection in the US. As a result, Canadian publishers could freely reprint the work, and some did, like Broadview Press, but they could not legally sell it in the US.

The Historical Context

This harkens back to the bad old days in the 19^th century when Canadian printers would frequently publish US works without obtaining rights from the author since at the time US registered works enjoyed copyright protection only within the United States, just as British or Canadian works were protected only in Britain and its possessions. Thus, reprinting US works in Canada without permission from the US rightsholder was legal. What was not legal was the smuggling of these Canadian-printed US works back into the US at cut-rate prices, a situation that led Mark Twain to lament his mistrust of “Canadian pirates”. (Just to be clear, I am not suggesting that modern Canadian publishers of US works that are in the public domain in Canada but not in the US are engaged in illicit supply of those books to US readers). At the time this Canadian “piracy” was going on, US printers were treating British works similarly, freely reprinting them for sale in the US without having obtained or needing to obtain the rights, as I discussed in this blog post. Because of its geographical position adjacent to the US yet still subject to certain imperial laws, Canada found itself caught in the crossfire of the Anglo-American copyright wars of the late 19^th century. With the signing of the Berne Convention in 1886, and the passage of legislation in the US in 1891 that provided for reciprocal recognition of national copyrights under certain conditions, this problem was largely resolved.

Anne of Green Gables

While at the present time copyright protection in the US is generally longer than in Canada for the same works, at times Canadian copyrights have been longer than those in the US. This is particularly true of that quintessential early Canadian work, Anne of Green Gables. If you will allow me to go down the copyright nerd rabbit hole for a second, I will explain how this occurred.

Lucy Maude Montgomery’s work was published first in the United States in 1908. Like many Canadian writers at the time, she thought her chances of getting published south of the border were better than in Canada. Under then US law (the Copyright Act of 1909), the work was entitled to 28 years of protection from date of publication, subject to a further 28 years of protection if the rights-holder renewed the rights in the 28^th year. The book’s publisher, L.C. Page & Co. of Boston, was assiduous in protecting its rights and ensured that the term of protection was extended, which provided protection until 1964. However, beginning in 1963, the US Congress annually passed interim extensions to works still under copyright, in anticipation of a major overhaul of US copyright law. Thus the work was still protected when the US Copyright Act of 1976 came into effect on January 1, 1978. That legislation converted the US term of protection for books from a set period after publication to the more widely accepted rule of author’s life plus a specified number of years, in this case fifty.

The Berne Convention countries had recommended “life plus 50” as the minimum standard of protection in 1908 and incorporated it as a requirement in 1948. The US now joined this consensus (although it did not join Berne at that time). The new US “life plus 50” rules applied to all works created after January 1, 1978, but what to do about earlier works? Pre-1978 works were subject only to a 56 year term of protection after publication, so Congress extended the period of supplementary protection under the old legislation (28 years) by an additional 19 years, making the full term for a registered older work 75 years (28 for the original term and 47 for the supplementary term) from the date of publication. This 19-year extension provided copyright protection to the 1908 Anne of Green Gables up to 1983 in the US. Meanwhile, Canada had been following the Berne “life plus 50” standard since the early 1920s. Thus, the copyright on Anne of Green Gables (or any of Montgomery’s other works) in Canada was protected until January 1, 1993, almost a decade longer than in the US, Montgomery having died in April 1942.

The lapse of copyright on Anne in both the US and Canada has not, however, stopped the Montgomery estate and the Government of Prince Edward Island, which has set up the Anne Authority, from vigorously pursuing legal action against any usurpers of the Anne trademarks that they have registered. A couple of years ago they threatened the US producers of an Anne spin off, a musical called Anne of Green Gables: A New Musical, with a lawsuit for trademark violation. The producers countersued, claiming that Anne was as much in the public domain as Shakespeare. In the end, both sides dropped their suits and the musical continued in production.

The US Extends its Term in 1998: Why?

While Anne’s copyright lapsed in Canada later than in the US, ever since the US extended its terms of copyright from “life plus 50” to “life plus 70” in 1998, the shoe is normally on the other foot. There are critics in the US that claim Congress passed the extension to satisfy the Walt Disney Company, given that some of Disney’s corporate copyrights were close to expiring, notably the copyright on Mickey Mouse. Steamboat Willie first appeared in 1928. As I wrote in a blog post a couple of years ago, (The Mickey Mouse Copyright Extension Myth: A Convenient “Straw Man” to Attack), that is hogwash. Of course, Disney was not opposed to extending the term of copyright protection, but whatever lobbying it did was not the primary reason for the US action. The main motivation was to bring US copyright into line with that of the EU. The EU had harmonized its copyright term (which varied widely between member states) to a common “life plus 70” standard in 1993. Since the extra 20 years were beyond the required Berne minimum, the EU was free to apply a reciprocity clause, which it did in order to encourage other countries to follow its example. It would extend the longer period of protection to non-EU authors only if EU authors received similar protection in the other country. This was a permitted derogation from the normal national treatment rule in Berne whereby any member state was required to accord a foreign copyright holder equivalent treatment to that provided to its own nationals.

The adding of an additional 20 years to US copyright protection had an additional wrinkle beyond going from “life plus 50” to “life plus 70” for post-1978 works. When the US changed its term to life of the author plus 50 years back in 1978 , recall that it instituted a provision for works protected under the old regime (where protection began from the date of publication) by rounding up the period of protection post-publication to 75 years. When it added 20 years to the “life plus” formula in 1998, Congress also added 20 years to the protection afforded works published pre-1978. Thus, these earlier works were now protected for 95 years from the date of publication.

Steamboat Willie

This leads us to Steamboat Willie and the frenzy that took place amongst public domain advocates when Willie entered the public domain on January 1 of this year. Almost every US broadcast and media outlet had a lead article on this “amazing development”, but Canadians were not spared. The CBC, Globe and Mail, Toronto Star, and others–even some Canadian law firms—breathlessly touted the entry of the mouse into the public domain, without bothering to even reference how Canadian copyright law applied. Some of them simply picked up a syndicated AP story, but none bothered to mention the salient but apparently unreportable fact that Willie was already in the public domain in Canada–and had been for two years! Apparently nobody noticed.

All the nonsense about works entering the US public domain on January 1 each year is designed to promote the narrative that these works have somehow been released from bondage, and that new explosions of creativity using the stories and characters are about to appear. Winnie the Pooh was the star of the show back in 2022, with the CBC grabbing the story, neglecting to mention that author A.A. Milne’s works had been in the public domain in Canada since 2007, (50 years after Milne’s passing). It’s total rubbish, with the new “creative works” emerging from this process leaving more than a little to be desired.

Why was Willie in the Public Domain in Canada but not the US?

This is yet another copyright rabbit hole to explore. Hang on. Willie entered the public domain in the US in 2024 because of the 95 year rule mentioned earlier. Pre-1978 published US works are subject to this rule (unless the copyright was not renewed in the 28^th year). Thus, Steamboat Willie, having first appeared in 1928, entered the public domain in the US this January. But Canada does not apply this rule. Its term of protection is based on the life of the author or authors (in the case of joint authorship). In the case of Steamboat Willie, there were two co-authors who held the copyright, Walt Disney and Ub Iwerks.

In his blog post “Mickey Mouse and the public domain”, copyright officer at Simon Fraser University in Vancouver, Donald Taylor, takes us through the details. Disney and Iwerks were the creators of the character. Disney died in 1966, Iwerks (a noted animator who created many Disney characters), died in 1971. With joint authorship, the term is based on the lifespan of the last survivor. Thus, in Canada, under the “life plus 50” rule that prevailed until the end of 2022, Steamboat Willie went into the Canadian public domain on January 1, 2022. Had Iwerks not died until 1972, the extended term that became effective in Canada on December 30, 2022 would have protected Willie in Canada until 2042. I wonder what the Canadian media outlets who prattled on earlier this year about Willie’s public domain entry on January 1 would have had to say then?

Willie and the Rule of the Shorter Term in Europe

There is even one more wrinkle in this, as pointed out by Taylor. Some countries have been applying the “life plus 70” rule for many years. In Germany it has been in effect since 1971, therefore in theory Willie should be protected in Germany until 2042. However, under something called the “rule of the shorter term”, (which allows the EU to apply the “shorter term” i.e. “life plus 50” to countries that do not match the EU’s “life plus 70” term), there is a provision that if a work enters the public domain in the country of its origin, then it will also be in the public domain of a country implementing the “rule of the shorter term.” Brazil does not apply this rule, so Willie is protected there until 2042, but he is now in the public domain in Germany. Incidentally, the EU’s application of the shorter term rule (the US does not apply it) provided additional benefits for Canadian authors when Canada extended its term in 2022, since Canadian works in the EU now get full national treatment, i.e. equal treatment with EU authors of “life plus 70”. What a rabbit hole!

When it comes to copyright, there is always something new to explore, a new wrinkle, a rabbit hole if you will. If there is one lesson that we can draw from all this, it’s don’t assume that what applies in the US when it comes to copyright (or any other law, for that matter) has any direct bearing on the situation in Canada, no matter what you see on TV, read in the Canadian press or hear on the CBC.

Editor’s Note: This post has been updated. The second and third paragraphs in the section headed “Anne of Green Gables” have been modified to explain that the work did not fall into the public domain in the US in 1964 (56 years after publication), only to have its copyright revived and extended after the implementation of the US Copyright Act of 1976. Rather, it continued to be protected as a result of a series of interim extensions passed by Congress until the enactment of the 1976 Act, at which time the term of pre-1978 works was extended by an additional 19 years, to 75 years from date of publication. As a result, in the case of Anne of Green Gables, its US copyright expired in 1983, as stated.

The Economics of Copyright: Incentives and Rewards (It’s Important to Get them Right)

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Two years ago, in April 2022, the US Copyright Office (USCO) appointed its first Chief Economist, Dr. Brent Lutes. Many national Intellectual Property Offices have such a position, e.g, UK IPO, IP Australia, EUIPO, and WIPO. (Notably, Canada’s Intellectual Property Office–CIPO–does not). All these positions have broad responsibility for assessing the economics of IP generally, covering patent, trademark, industrial designs as well as copyright. In the US, the Patent and Trademark Office has its own Chief Economist. However, Lutes’ USCO position appears to be the only one related exclusively to assessing the economic impact of copyright. The position sits within the Office of Policy and International Affairs and is composed of a small team of economists, providing the Register of Copyrights, Shira Perlmutter, with policy-relevant research on economic issues related to copyright.

In an interview conducted last month, Lutes talked about the economic goals of copyright in terms of enhancing social welfare. He noted the goal of copyright is to contribute to the welfare of society by promoting access to creative works, now and in the future, through market based behavioural incentives. The goal of the Office of Chief Economist is to gather more information to inform policy making, such as the geographic distribution of copyright activity or the demographic characteristics of creators. As but one example, is racial or ethnic diversity related to creativity? The economic issues surrounding AI and copyright, both pro and con, is another field of research the USCO will be exploring.

In addition to finding the right economic levers to stimulate production of creative works, economic studies of copyright also demonstrate the enormous impact copyright-based industries have on national economic welfare. While the impact can depend on what economic multipliers are used and how direct versus indirect benefits are calculated, there is no question that copyright industries in most economies are very significant as job creators and multipliers. For example, IP Australia in its most recent annual report estimates that cultural and creative activity contributes about 6% of Australian GDP annually, with design, fashion, publishing, broadcasting, electronic and digital media and film being the primary industries involved. In the US the figures are even more impressive. According to the International Intellectual Property Alliance, in 2021 (the last year for which statistics are apparently available), core copyright industries in the US, defined as those industries “whose primary purpose is to create, produce, distribute or exhibit copyright materials”, added $1.8 trillion to US GDP, accounting for 7.76% of the economy. Total copyright industries, a definition that includes industries partially dependent on copyright, such as fabric, jewellery or toys and games, account for another trillion USD, even when only a portion of their total value is included in the copyright calculation.

The UK Intellectual Property Office published its IP survey in 2022, comparing the role of patents, trademark, registered industrial designs and copyright. While copyright industries were on the low side for exports (£4.7 billion as opposed to patents at £120.6 billion, copyright’s “non-financial value-added output” (IP data is not available for the financial industries, thus the description of “non-financial”) trounced that of patent industries by almost 2:1. As with the US IIPA study, the UK report accounted for the degree to which certain industries depend on copyright, categorizing them as core, interdependent, partial or non-dedicated support industries, adjusting the amount of copyright contribution accordingly. Book publishing, for example, is considered a 100% copyright industry and its value is calculated as such, whereas for an industry such as paper manufacturing, only 25% of the value was included in the calculation of copyright benefits. This methodology followed that of the World Intellectual Property Organization, aka WIPO, which also conducts economic studies as well as assists national authorities with their own. Economists are careful people, not prone to exaggeration, and consistent methodology is important to ensure accurate measurement and reporting.

WIPO worked with the Department of Canadian Heritage to produce a report in 2020 on “The Economic Impact of Canada’s Copyright-Based Industries”. As with other deep dives on the economic benefits of copyright, this study produced similar notable statistics. For example, while many copyright opponents in Canada were deploring the extension of the copyright term of protection in Canada, arguing that the result would be an outflow of royalties to foreign rights-holders because Canada was a net importer of copyrighted materials, the Heritage report established that “Canada has exported more copyright-related services than it has imported, maintaining a trade balance surplus from 2009 ($2.5 billion) to 2019 ($5.6 billion)”. In actual fact, extending the copyright term in Canada brought with it the additional benefit of a reciprocal extended term in many foreign countries for Canadian works, clearly benefiting Canadian rights-holders. The Heritage study went on to document a range of other important outcomes such as employment (over 600,000), contribution to GDP ($95.6 billion) and percentage of GDP (4.9%). All figures are based on 2019 data. No update has been published since. It is just as well that Heritage Canada took the lead in preparing this report since the government department holding lead statutory responsible for copyright in Canada, the mammoth Department of Industry, Science and Economic Development (ISED), unfortunately seems to treat copyright as but a tiny pimple on its elephantine rump.

While the studies cited above highlight the economic contribution that copyright industries make to national economies in terms of jobs and wealth generation, let us not forget the key point that Dr. Lutes underlined regarding the social welfare contribution of copyright through using market-based incentives to promote and encourage creativity and investment in creative outputs. It is hard, if not impossible, to put a dollar amount on the social welfare benefits of creative expression and cultural sovereignty, but they are immense if incalculable. Without copyright, not only would existing content-based industries be unable to thrive and expand, but the formula to encourage new, original content would be missing.

Notwithstanding the importance of a robust copyright framework for both economic and social welfare, creators and content-based copyright industries are facing major challenges today. Some are technological, like the emergence of generative AI; some behavioural, such as a wide tolerance, even acceptance, of piracy and free riding. The struggle against piracy is ongoing and protracted, a cat and mouse game. Free riding is what AI developers are doing on the backs of content creators through unauthorized training of AI models on copyrighted content, with resultant legal challenges. There is also the question of whether wholly AI generated works should be accorded copyright protection. As the Copyright Alliance has observed, the Copyright Clause in the US Constitution is premised on the promotion of the “progress of science and useful arts” by protecting for a limited period of time the writings and discoveries of authors and inventors. Given that premise, it should be self-evident that creator incentivization is not applicable to machines, which do not need nor comprehend economic incentives to create.

Free riding is also what the education sector has been doing in Canada under the specious umbrella of “education fair dealing”, introduced through copyright amendments in 2012 that broadened the scope of fair dealing. Since then, the “education industry” at the public, secondary and post-secondary level has been siphoning off economic value from writers and other creators to the tune to date of over CAD$200 million. Their legalized renunciation of collective reprographic licensing is ostensibly to benefit students but is in fact a transfer of wealth from creators to the bottom line of educational institutions. If a key objective of copyright is to incentivize creation of new content, such as materials used by educational institutions to teach students, then the current interpretation of education fair dealing in Canada upends a key rationale for granting copyright protection in the first place. (As a footnote, I should add that not all arguments in favour of copyright are based solely on economic incentives. There is also the question of natural justice and equity, providing authors with a degree of control over works they have created).

Since court challenges have unfortunately proven ineffective, the remedy for Canada’s education fair dealing fiasco is for the Government of Canada to amend the Copyright Act so that rightsholders are properly compensated when their works are used in Canada. Both the copyright collective in English Canada, Access Copyright and its Québec counterpart, Copibec, recently called for legal clarification of the nature and extent of educational fair dealing.

Thorough documentation of the contribution that copyright makes to economic and social welfare helps substantiate the case for adequate legal frameworks, including combatting piracy and ending copyright free riding. Sound economic data are essential to sound policy making. The initiative of the US Copyright Office to appoint a Chief Economist helps to meet these goals and is to be commended. Should the Canadian Intellectual Property Office ever create such a position, its first task should be to evaluate the full economic and social costs of the current short-sighted interpretation of fair dealing in Canada’s education sector in terms of its negative long-term impact on creativity and cultural sovereignty in the country.

The Scottish writer Thomas Carlyle may have described economics as the “dismal science”, an oft-quoted remark, but rather than being dismal it is in fact just the opposite; it sheds light on the importance of copyright to maintaining a well-functioning, equitable and culturally rich modern society.

Public Lending Right (PLR) Registration in Canada is Still Open: Enrol If You Are Eligible

Photo: Author

If you know all about the Public Lending Right (PLR) program in Canada, you probably don’t need this reminder. However, if you don’t and are a Canadian (citizen or resident) writer, editor, translator, photographer, illustrator, or narrator who has published a printed, audio or e-book with an ISBN number in the last five years, you may qualify for a PLR payment—but only if you register by May 1. The PLR program, run by the PLR Commission in association with the Canada Council, has been in operation in Canada since 1986. It distributes annually approximately $15 million to qualified authors registered with the program, based on a sampling of major libraries across the country to determine whether registered works are present in library holdings. Payments are based on library holdings, not the number of times a work is loaned out, despite the name “lending right”. This year, payments were made to 18,247 authors of the 20,091 who have registered. The maximum payout to an author was $4,500. Minimum payment is $50. The average payment was $806 and the median (half above; half below) was $399.91. Once a book is registered and confirmed to be in the library inventory, payments can continue for up to 25 years.

Not all genres are eligible. While the program covers fiction, poetry, drama, children’s literature, non-fiction and scholarly works, “practical” books such as cookbooks, self-help, “how-to” guides, travel guides, manuals, reference works, educational books like textbooks or books resulting from a conference, seminar or symposium, and periodicals, are not eligible. Full eligibility criteria for registration can be found here. Registration is a bit old-school and not that simple. A form needs to be downloaded and completed by hand. Various codes have to be added to the form (there is a guide). Photocopies have to be made of the work’s title page, copyright page, and table of contents. For audiobooks similar information must be provided, such as a photocopy of the audiobook box cover. Next, this all has to be packaged up and mailed through Canada Post. Registered mail is advised. Applications are then assessed, compared against an electronic database of library holdings and cheques prepared for mail out by February of next year. (A recent innovation is an option for electronic deposit). All this is accomplished by a dedicated staff of just 4 people!

About 800 authors a year apply for the program. In a sense, this is a problem because funding has not been increased for around two decades. (While new authors are added, there is some natural attrition as the estates of deceased authors do not receive payments, plus there is a drop off as older works age out). But the end result is a net increase, with the same amount of funding being spread over an ever-increasing base. Not only that, with inflation over the years the value of payments has actually declined by almost 50%. The Trudeau government made a pledge to increase the PLR back in 2021 but so far has taken no action. The Writers Union of Canada has advocated for a doubling of annual funding from $15 to $30 million (it was just $3 million when first launched in 1986). A coalition of Canadian publishing and authors organizations has just sent a public letter to the Minister for Canadian Heritage and the Finance Minister prior to the release of the 2024 budget on April 16 urging that commitments to increase funding be fulfilled.

The formula for payments to authors is somewhat complicated. It is explained on the PLR website as follows:

“Payment per title = Hit rate × # libraries where title is found × % share × time adjustment”

The hit rate varies but last year was $61.53. That is multiplied by the number of libraries where the title was found. If the author claims full title there is no percentage share adjustment but where a work has more than one author claiming a share of title (e.g. a writer as well as an illustrator), there is an adjustment related to the amount of contribution each made to the creation of the work. The time adjustment is related to when the work is published. Older works are subject to a discount. Got it? The best way to find out what you might earn is to register, assuming your work qualifies. If you get a cheque in 2025 you will have some idea of your contribution to the literary base of Canadian libraries.

Canada is now one of more than 30 countries that has a PLR. (The US does not). The first PLR program goes back to 1946 in Denmark, followed by Norway and Sweden although the idea originated in 1919 with the Nordic Authors’ Association passing a resolution calling on governments to compensate authors for library lending of their books. The World Intellectual Property Association (WIPO) defines the PLR as “the legal right that allows authors and other right holders to receive payment from government to compensate for the free loan of their books by public and other libraries.” In Europe, the PLR is actually underpinned by copyright legislation in the form of the Rental and Lending Right Directive (Directive 2006/115/EC) that provides authors with an exclusive right over the lending out of their works, or remuneration for the lending of such works. PLR in non-EU countries, such as Canada, Australia, New Zealand and Israel is not dependent on a legal right but is in fact a form of government subsidy to authors. In some countries payment is based on how often works are loaned, in others, such as Canada, it is based on library holdings.

In most countries, including Canada, libraries do not pay for the PLR, and it does not affect their budgets. Instead, funding comes from central government sources. You would think, therefore, that being part of the writer/publisher/reader ecosystem, libraries would be enthusiastic supporters of such payments to authors as it encourages them to create more works, enlarging the base of books available to users of libraries. That, however, is usually not the case. Libraries generally don’t support, or give very lukewarm support, to the PLR for fear that funding for it might come out of their hide, as in the Netherlands. (WIPO tactfully says that “In the few cases where libraries pay for PLR, such as in The Netherlands where public libraries operate as independent entities, PLR is viewed by the library community as a legitimate charge that fairly compensates authors for the use of their works free of charge by the public”). That is a very rosy interpretation of the position of most library associations. Not only is there concern that somehow funding for authors will mean less money for libraries, but there is ideological opposition from library associations too.

The International Federation of Library Associations and Institutions (IFLA), in its policy statement on PLR, states that “IFLA does not favour the principles of ‘lending right’, which can jeopardize free access to the services of publicly accessible libraries, which is the citizen’s human right…” It goes on to say that “the justification usually given for PLR – that the use of copyright works through public libraries detracts from primary sales – is unproven”, arguing that lending by libraries often assists in the marketing of copyright works. (equally unproven, I would say). The Canadian Library Association has published opinion pieces echoing IFLA’s position, although its official position is that it supports payments to Canadian writers and endorses the use of library data to implement the PLR. There are caveats, however, such as opposition to any legal entitlement to PLR payments for writers plus assertions that library lending is of financial benefit to authors even without any PLR payments.

Despite reluctant library endorsement, PLR continues to grow globally. It now exists in 34 countries, with another 27 having it under consideration. As a result, in 2019 IFLA nuanced its outright opposition. For countries where there is not yet a PLR, members are urged to continue to oppose it. In particular IFLA opposes establishment of a PLR in developing countries (I guess writers in those countries don’t deserve support). If institution of a PLR appears inevitable, IFLA’s position is that national library associations must insist it not be funded from library budgets and that the administrative burdens on libraries be minimized.

PLR International, an advocate for expanding the PLR that holds an international conference every few years (the last one was in Brussels in September of last year), has addressed the IFLA position head on. It clearly states in its Charter of Best Practices that “PLR systems should be funded directly by central and/or regional government and should NOT be funded from library budgets.” Canada’s PLR Commission has “Celebrating Libraries” as one of its three fundamental pillars, the others being “Supporting Authors” and “Enriching Readers”, no doubt in acknowledgement of the generally tepid position of library associations on the PLR. (Interestingly, in the UK, the PLR system is run by the British Library).

The sometimes surprising misalignment between authors and library interests relates not just to the PLR, as I wrote a few years ago (“Are Libraries the Enemy of Authors and Publishers?”). I concluded they were not, although more recently the position that some in the library sector have taken on Controlled Digital Lending and collective licensing (“Chided by the Canadian Federation of Library Associations for Defending Authors: What an Honour!) for educational publishers makes me wonder.

But whether Canadian libraries are enthusiastic or lukewarm supporters of the PLR, it exists and has been in existence in Canada for almost 40 years, albeit without any legislative foundation. Although payments are relatively trivial, they are nonetheless a welcome supplement to the income of many writers and are a mark of recognition and partnership between libraries and authors, even though it seems some librarians are reluctant to see it that way. Published authors out there who have not registered should do so, if only to demonstrate to the government the wide base of creativity in Canada and to encourage a topping up of the PLR fund. You have two weeks left. Deadline is May 1. Don’t miss out.

A Cautionary Copyright Tale

My daughter’s (copyrighted) art, circa 1990, age 5 (Used with permission)

It is rare that a copyright story makes the national news, in Canada or elsewhere, but this one had all the needed ingredients. A teacher exploiting students, irate parents, and a possibly negligent school board. What’s not to like?

The Canadian Press reported that ten Montreal area parents have launched a lawsuit for CAD$1.6 million against a junior high school teacher for copyright infringement, and for negligence on the part of the Board. According to the report, Mario Perron is (or was?) an art teacher at Westwood Junior High in St. Lazare, QC, west of Montreal Island. Perron had assigned his class to prepare “creepy portraits” of themselves and other students in the style of artist Jean-Michel Basquiat who, despite his Quebecois sounding name, was an American neo-impressionist artist in the 1980s who worked with Andy Warhol. Some of the works produced by the students were quite interesting, judging by the samples displayed in this Google search. (Who knows? Maybe they relied on an AI program to produce Basquiat-like works “in the style of”, as I did a couple of years ago for an earlier blog). My prompt, however, was for an artist (Monet) whose work is in the public domain.

Their teacher clearly did not give much thought to copyright when he posted artwork created by the students on his website, including portraits of classmates and self-portraits screened on to tee-shirts and coffee mugs. They were offered for sale at various prices, over $100 in some cases. There is little question that this was a flagrant violation of the student artists’ copyright. You may ask why these students would enjoy copyright in these amateur works? The answer is simple. The works met all the criteria in Canada to be eligible for copyright protection.

There is no minimum limit on the age of a creator, although a creator has to be living, sentient human being, not an AI robot or a monkey with a camera. (Yes, in theory even an infant’s artwork could be protected by copyright). All that needs to be shown is that the work is original (not a copy), that it is the expression of an idea (the idea itself cannot be copyrighted), that it demonstrates “skill and judgement” and that it is fixed in some form (i.e. a physical incarnation as on a canvas, or on paper, a recording, a photograph.) Plus, the artist must be a resident of a Berne Convention country (which Canada is). These works met all these criteria. A work does not have to be a Rembrandt to enjoy copyright protection. The artist does not have to be famous or have produced any other work. It could be argued that even dipping your hand into a can of paint and placing it in a certain way on the canvas constitutes originality, skill and judgement. These works belonged to the student artists and neither their teacher, nor anyone else, had the right to appropriate them through unauthorized reproduction and distribution, let alone for commercial purposes. The law is very clear.

In addition to copyright considerations, here are additional factors to take into account, such as the fact that the portraits were, according to the teacher’s instructions, either self-portraits or portraits of classmates. Since the instruction was to produce a “creepy portrait” à la Basquiat, it is not inconceivable that some of the subjects of the works might become the object of ridicule or harassment since their first names were attached to the portraits. This issue goes beyond copyright law, but it is important to remember that copyright law grants the creator the right to determine the means and extent of distribution of a work (for example, the author can decide not to publish or display it). These rights were violated. It is the potential damage from the unauthorized distribution of the works that could be even more harmful than the violation of economic rights. To usurp the right of the artist to decide where and how their work will be displayed is a clear violation of copyright law. I won’t comment on the personal harm aspects of the case, but they are clearly related to the copyright infringement elements.

The remedies sought are substantial, amounting to $155,000 for each of the ten families involved in the suit, based on statutory damages of $5000 per work times 31 works, the number created by each student. In addition, the plaintiffs are seeking $100,000 in punitive damages and $150,000 in costs. Canada’s Copyright Act, Section 38.1(1) provides for statutory damages (damages where the amount of actual damage does not have to be documented, nor actual injury proven) of not less than $500 and not more than $20,000 for commercial infringement, and not less than $100 and not more than $5000 for non-commercial infringement. Mr. Perron is potentially in big trouble.

As for the School Board, which is saying very little, the claim is that they were negligent in allowing this to happen. Are they any more negligent than a company whose employee carries out illicit after-hours activities, such as copyright violations of the work of others? I wouldn’t have thought so, but of course a teacher does exercise a position of trust over their students, and the Board is responsible for ensuring that the trust is exercised responsibly, so perhaps. The works were created in a classroom setting (this does not give either the school or the instructor any authorship rights over the works, by the way), yet the infringement occurred outside school hours and premises. Could or should the school administration have known? There certainly wasn’t a line in the policy book for teachers that said, “Do not make unauthorized use of student art for your own commercial gain”. Who would have thought of that? Anyway, I am not a lawyer so what I think about the Board’s culpability doesn’t really matter. The court will decide, if it gets to court.

The parents (one of whom must surely be an IP lawyer) have also asked for a written apology, the removal of all the students’ art from the internet and an accounting of funds earned. To my knowledge, they have not demanded that Perron be fired, although that may happen. Perhaps the suit has been filed to get the attention of the School Board, which was dilatory in responding to initial complaints. Perhaps there will be a non-punitive settlement, with any proceeds to date being donated to school art programs. Hopefully Mr. Perron and others will have learned an important lesson about the role of copyright in protecting the work of creators, even if they are young students. Perhaps he won’t lose his job.

I would like to think the result will be a greater awareness by educators, students and the public of the importance of copyright in society today. Let’s hope that this particular teacher was simply blind or ignorant with regard to his actions, not malign. He will now know better. It is an important lesson for all concerned, and a cautionary copyright tale if there ever was one.

Would Anyone Copyright This Flag? (Not an April Fool’s Joke)

Image: Flags of the World (Used with permission)

No, this flag is not an April Fool’s joke, although I am posting this on April 1. As a flag design, it’s a dog’s breakfast. Not that a registered design has to be aesthetically appealing, but it needs to be original. And this one is original, in its own way. The flag of the Town of Ladysmith, BC, as Ladysmith councillor Jeff Virtanen has stated, is a “hodgepodge”. The mayor also agrees that it should be updated. Where it actually came from, no-one is saying but it is a pastiche of the red bars of the Canadian flag, with a maple leaf in the lower right, dogwood symbol (the provincial flower of British Columbia) in the upper left, and then, in the middle, a design of what appears to be a sail boat (Ladysmith does have a harbour) with two horseshoes superimposed on the sail (not sure what they are supposed to represent), with a diagonal slash that says “49^th parallel”.

That is a reference to Ladysmith’s location, smack on the 49^th parallel, the dividing line between Canada and the United States for most of North America west of Lake of the Woods. However, owing to a quirk of both history and geography, when the boundary west of the Rockies between the United States and British possessions in North America was settled by the Oregon Treaty of 1846, all of Vancouver Island, which extends south as far as Victoria at latitude 48’ 25” N, was included within British territory. Somehow, the fact that you can drive through the 49^th parallel without being accosted by the US Border Patrol or the Canada Border Services Agency is part of Ladysmith’s appeal. Actually, it is a nice little town of 9,000 originally established as a coal mining centre back at the beginning of the 20^th century, with a great location, some nice heritage buildings—and a very eclectic flag.

Last year I wrote about flags and copyright (“Flagging Copyright Concerns: Vexillologists Take Note”), given the controversy over the Australian Aboriginal flag, when the Australian government had to fork over AUD$20 million to purchase the copyright to a flag design that it had adopted, as the Aboriginal flag, under the Flags Act. Aboriginal artist Harold Thomas had designed the flag back in the 1970s and an Australian court had upheld his copyright on the design. I doubt if there is going to be any dispute over ownership to the Ladysmith flag, although you will note that the flag image gracing this blog at the top of this page is used with permission of the website Flags of the World, which has a depiction of the Ladysmith flag along with 188,000 other flags. It is very detailed. If you want to know what the flag of Tannu Tuva between 1933 and 1941 looked like, this is the place to find out.

Generally, most country flags are not copyright protected either because the designs have lost protection owing to the lapse of time or because governments have made them copyright exempt. However, there may be other forms of intellectual property protection to ensure the national flag is not misused in such a way as to misrepresent a commercial entity as a government institution, or to prevent it from being disfigured or dishonoured.

Flags of the World has an extensive section on copyright, noting that, “Our editorial policy is to include images only when we can ascertain that we have permission to use them”. The website gives permission to use any of the flags on the site under the following conditions;

you limit your use to a maximum of 5% of the images or content of the website (let’s see, 5% of 188,000 is 9,400 so I am OK there)
you quote the author (Check, did that)
you quote the website (Check, yup)
you do not alter in any way the images or the content of the text (Check)
you use the material for non-commercial and non-political purposes only (And Check)

It looks like I am in the clear when it comes to using this particular flag image. However, just to be extra vigilant I asked for and was granted permission to use the flag design on the website which was designed by Masao Okazaki from a photo located by Dave Fowler. It is not clear who the original designer of the Ladysmith flag is or was.

Now, whether and when Ladysmith’s municipal flag will get a makeover is a good question. It may not be top of mind for residents who are dealing with other issues, like inflation, world peace or whatever. Still, a flag is a branding tool, and this brand needs updating.

But here are some copyright considerations that Ladysmith Town Council might want to consider.

When the new design is approved by Council, no doubt after an extensive public consultation process, the flag designer (or their estate) will hold the copyright for the work for the duration of their lifetime, plus 70 years. That is unless they are an employee of the town and were assigned the task of flag design as part of their duties, in which case ownership would vest in the township (unless there is an agreement between the employee and employer to the contrary) although the copyright term of protection will still last for the life of the author plus 70 years. In Canada, there can be a distinction between authorship and ownership. If the artist is not an employee but if the work is produced under a “contract of service or apprenticeship”, (as opposed to a simple “contract for services”), the township will also own the copyright. But if the work is done under a “contract for services”, i.e. as an “independent contractor”, the author of the work will control the copyright. What is the difference between the two types of contracts? That is why we have lawyers!

If you want to add another layer of complexity, even if the copyright is owned by the township, the author will still enjoy moral rights in the work, that is the ability to protect the integrity of the work, unless there is an agreement to the contrary. So, if we take the current flag as an example, and Council decides to remove the two horseshoes from the sailboat’s flag, in theory the creator of the original design (if anyone is aware of who that is) could assert their moral rights to oppose the modification of the flag. Better to get a new one designed and, if possible, control the copyright through contractual provisions.

Replacing a poorly designed flag may be a good idea, but keep in mind the copyright ramifications. I am sure that the Town has a legal department, or at least a lawyer on retainer for legal advice, so they will no doubt do it right. I can hardly wait to see the new flag floating proudly over Ladysmith harbour.

After Blocking News in Canada, Meta Challenges Australia (Again)

Image: Shutterstock via AI modification

It was inevitable. After Meta pulled the plug on news content on its platform in Canada as its way of complying with the obligations of the Online News Act, Australia, the model that Canada sought to emulate, was surely next in line. On March 1, Meta announced that it plans to stop paying publishers of news content in Australia, and will not renew its current agreements with Australian media once they expire. Most will expire this year.

Canada had modelled its Online News Act (Bill C-18) on Australia’s News Media Bargaining Code, albeit with “improvements”. Rod Sims, who was head of the Australian Competition and Consumer Commission (ACCC) at the time the Commission designed the Code (later incorporated into legislation as the Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code) Act 2021), was invited to testify before the Canadian Parliamentary committee examining Bill C-18. In his testimony, Sims talked about the success of the Code, its benefits for not just large media players but also many smaller “country” outlets, estimating the benefits to be north of A$200 million per year to journalism in Australia. He added that the institution of the Code “has transformed the journalism landscape in Australia. It’s gone from pessimism to optimism.”

Inspired by the results of the Australian legislation (which, by the way, ended up not designating either Google or Facebook under the Code, since they managed to come to sufficient “voluntary” agreements with Australian media), Canada moved ahead, basing its legislation on the Australian law but adding a couple of additional features. One was to increase transparency with regard to deals that would be struck under the law. Another was to require self-designation by platforms (while making it apparent that only Meta/Facebook and Google) met the criteria, allowing them an exemption if they reached acceptable deals with media. In this way, the companies could not avoid designation and would be subject to the law, something they strongly opposed, even though both had already engaged in voluntary programs on their own terms to provide some financial support to selected media outlets.

Just as happened in Australia, (see “Google’s Latest “Stoush” with Australia: What’s the Lesson from Germany’s Failed Effort? and “Facebook in Australia: “READY, FIRE, AIM”) both platforms pushed back strongly against the draft legislation, threatening to block news for Canadian users. (Facebook briefly and disastrously blocked news for Australian users during its campaign against the Code, but ultimately backed down). First, in the fall of 2022 Facebook said it might have to block postings of news on its Canadian platform, followed by Google which threatened to block search for Canadian news in Canada by Canadian users. By the summer of 2023, when the Online News Act became law without any of the amendments proposed by the platforms, Meta upped the ante by declaring that it would end news availability on Facebook and Instagram for all users in Canada prior to the Act taking effect, set for December 2023. Again, just as in Australia, Canadian government leaders were public in their condemnation, accusing Meta of threatening and irresponsible behaviour. Alas, it was all to no avail. It appears Meta had already made its decision to not provide financial support for news content in Canada, and to end the few existing agreements that it had undertaken in the past. At the time, it indicated it would also be taking similar action elsewhere. Rather than submit to the legislation by negotiating with media entities, it complied (in letter if not in spirit) by blocking links to Canadian media. Negotiations with Google continued and eventually a compromise of sorts was reached whereby Google agreed to contribute to a fund which would be used to support journalism in Canada.

This was a somewhat pyrrhic victory (the fund will be about $100 million, less than half what had previously been estimated), but a victory nonetheless in the eyes of at least some of the news media. One can debate the overall success of the legislation (see MediaPolicy.ca’s “The Online News Act is law: a buzzer-beater win or epic miscalculation?”), but along with more government financial support, the Google funded pot will be welcomed by many smaller media outfits. Ironically, establishing a fund rather than requiring negotiations between the platforms and media for payment for content was an early proposal by some commentators. Now this has come to pass more by accident than design. Criteria for disbursing from the fund have been tweaked so that broadcast media, and in particular the CBC, who employ the bulk of news journalists in the country, get less than their proportional share would otherwise indicate.

The lesson for Canada, and now for Australia, is that the big digital platforms will not hesitate to play hardball if they feel their global interests are threatened. While Australia, followed by Canada, was first off the mark with legislation designed to level the playing field between a stressed journalism sector and the monolithic platforms, the response of the platforms was governed more by potential precedent than the specifics of those markets. The existence of draft legislation at the federal level in the US, (the Journalism Competition and Preservation Act, aka JCPA) as well as at the state level in California and Illinois, has not escaped the attention of Meta and Google. (Even the watered-down compromise settlement that Google made with Canada has led to some lip-smacking speculation in the US as to the amount of funding that could flow to US media). It appears that Meta, in the face of cost cutting and loss of market share in 2022, had made a business decision that if it had to pay for access to news content, it would do without. To what extent this is a wise business decision remains to be seen, but the company has clearly made a business decision in this regard. This decision may or may not affect Meta’s bottom line, but it will have the effect of leaving the platform as a purveyor of less than reliable information from nonprofessional sources. However, doing the most socially responsible thing as opposed to maximizing profits by cutting costs is not what Meta is about. Having made its decision, it will need to unwind its commitments to Australian media, which it is now in the process of doing.

What does this mean for Australia and what can the Australian government do about it? Writing about this in Canada’s National Post, Rod Sims, now professor at the Crawford School of Public Policy at ANU, outlined some choices the Australian government needs to face. It could move to designate Meta under the Bargaining Code and force it into the negotiation and arbitration process. That would likely lead to Meta taking precisely the action that it took in Canada. The government could amend the legislation, but to what end? It could publicly criticize Meta, accusing it of unfairness and bad behaviour. It has already done this, with Prime Minister Albanese saying that what Meta is doing is “not the Australian way”. That will have zero influence on Mark Zuckerberg and the people who run Meta.

At the end of the day, Australia can stand up to Meta, and let the chips fall as they may, or it can allow Meta to free ride on Australian news content, accepting that there may be social benefits in allowing this to happen. A recent report by the Australian Broadcasting Commission (ABC) points out that Facebook is the largest social media platform for general news and half of Facebook’s users in Australia report using the social media platform for news. (Regardless of this, Meta’s beancounters give news no value to the platform). According to a University of Canberra report cited by ABC, 45% of Australians get their news from social media as opposed to less than 20% from print sources. The largest source of news is still TV at 58%. (The numbers are greater than 100 because many consumers get their news from more than one source). In one sampling, 14% of Australians got their news from Instagram! While I find this personally appalling (indirectly revealing my age), that is the reality of our society today. Better that consumers find reliable, curated news somewhere–but we still need to recognize that responsible journalism needs to be paid for. Meta, apparently, has no desire to be a part of that equation. Without the infusion of responsible, curated journalism, Facebook will become an even greater home for misinformation than it already is. But does Meta care? Clearly not. Consumers need to be encouraged to find their news sources elsewhere. Easier said than done.

The Australian government is no doubt pondering how to respond in the best interest of Australia. Allowing Meta to wriggle out from its obligations under the Bargaining Code would not necessarily undermine the deals struck with Google, who appears to have accepted that its overall interest is best served by some form of accommodation. Having Microsoft, which has publicly stated it is willing to subject itself to both the Australian and Canadian legislation, breathing down its neck is undoubtedly a factor in this. Even if the Google deal won’t be undone, it is still galling that Meta can get away with it. Canada had to swallow that reality, yet stood up to Meta. What will Australia do? It’s a tough call.

More Balanced Interpretation of US “Transformation” Fair Use Test gives Rightsholders Better Leverage to Protect their Works

Photo: Author

A couple of recent cases in the US involving (mis)appropriation of copyrighted photographs indicate the tide may be changing with respect to the interpretation of what constitutes fair use, moving from a very liberal interpretation of “transformation” that has been used in recent years to justify unauthorized reproduction of copyrighted works by making them into “something (allegedly) new”, to a more balanced interpretation where the rights of the original creator/rightsholder are given greater weight. These cases are Andy Warhol Foundation v Goldsmith, decided by the US Supreme Court in May of 2023 and now, just last week, two cases (Graham v Prince and McNatt v Prince) in New York District Court. These involved photographers Donald Graham and Eric McNatt who had sued prominent appropriation artist Richard Prince and two well-known galleries, Gagosian and Blum & Poe, for copyright infringement. A final judgment was entered in these cases wherein Prince was found liable for willful infringement of the photographs, required to pay damages totalling five times the value of the infringing works he sold, plus paying the plaintiff’s legal costs, while also being restrained from reproducing, modifying, or distributing the contested artwork that was developed from the appropriated photographs. This is a big deal for photographers and other creators whose work is appropriated by others without authorization on the pretext of “transformation”. It could even have a ripple effect outside the US.

Last week my blog post was about photography, looked at through a historical lens from a copyright perspective. Photographers initially had a struggle to gain copyright protection for their works, at least in the US, but for many years now have enjoyed the benefits of such protection. However, just because photographs are recognized as copyright protected works doesn’t mean that infringement does not occur on a regular basis, or that photographers have not had their work appropriated without authorization as a result of court rulings interpreting what constitutes fair use (in the US).

For those readers not immersed in the minutiae of copyright, what follows is a brief explanation about fair use in the US and fair dealing in Canada. (Others may choose to skip to the next paragraph). Fair use is the provision in US law that allows users to reproduce parts of copyrighted works without permission or authorization from the rights holder, subject to various limitations and conditions. Unlike in Canada or a number of other countries where legal exceptions to copyright are based on a specified list of “fair dealing” purposes, the US fair use list is only illustrative. There is a four-part test in the US that courts use to judge whether an unauthorized use constitutes fair use. The four factors that are weighed are; (1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work. The “transformation test”, which has been an important factor in determining fair use in the US in recent years, comes in under the first category of the purpose and character of the use. Transformative use has been interpreted by US courts to mean the addition of new expression or meaning to an original work to create something new with a different purpose. Parody, which is both a fair dealing exception in Canada and one of the illustrative fair use categories in the US, is such an example where the original work is transformed to give it a new and different meaning. But transformation in the US can involve much more than just parody. The 2015 Google Books case (Authors Guild v Google Inc) where Google was sued for copyright infringement for unauthorized scanning and display of copyrighted works was decided, in Google’s favour, on the basis of “transformation”. The US Court of Appeals found that, “Google’s making of a digital copy to provide a search function is a transformative use, which augments public knowledge by making available information about Plaintiffs’ books without providing the public with a substantial substitute for matter protected by the Plaintiffs’ copyright interests in the original works…”. Notably Google, in settling an earlier case with US publishers, had agreed to limit the public display of a copied work to no more than 20 percent of its contents. The transformative use argument has been used as a fair use defence in a number of US copyright cases, including some involving photography. In these cases, the entire photograph was taken without authorization but then “transformed” by the addition of some new content.

One notable such case is Cariou v Prince, finally decided on appeal in 2013. In this case, Richard Prince successfully claimed fair use for his adaptation of photographs taken by French photographer Patrick Cariou. Prince did a series of paintings that incorporated photos of Rastafarians taken from Cariou’s book “Yes, Rasta”. The Appeal Court found that Prince’s paintings were not only sufficiently transformative to be different works, but they did not compete with the original in the marketplace. This case was part of a trend where US courts successively widened the interpretation of fair use based on a liberal application of the transformation principle.

The antidote to Cariou is the more recent Warhol v Goldsmith case, mentioned above. In this case, celebrity photographer Lynn Goldsmith sued the Warhol Foundation for copyright infringement in 2017 after she learned that her 1981 photograph of the noted singer-songwriter-musician Prince, who died in 2016, (not Richard Prince the artist, just to confuse things), had been used by Warhol (who himself died in 1987) to create a series of 14 silk screen images back in 1984. At the time, Goldsmith had been paid $400 by the publisher Conde Nast for a one time use of her photograph as an artist’s reference for Warhol to create an image for a Vanity Fair article about Prince, Purple Fame, published in November 1984. However, she was unaware that Warhol had created a whole series of prints from her photo. Years later, Vanity Fair paid the Warhol Foundation $10,000 for use of another of the prints in the series, Orange Prince, in an article to mark Prince’s death. Goldsmith was neither paid nor credited. She sued (actually countersued) for infringement after the Foundation sought a declaratory judgment that the creation of the series was fair use. It was an uphill battle for Goldsmith against a very wealthy and well-known Foundation, but in the end she won. The US Supreme Court decided in May of 2023 that Goldsmith’s copyright had been infringed—but only in the one instance regarding the use of Orange Prince, which was seen as a market substitute for Goldsmith’s original photograph. The ruling was 7-2 with Justice Sotomayer writing “Goldsmith’s original works, like those of other photographers, are entitled to copyright protection, even against famous artists”.

The doors of transformative use, swinging wide open for the past couple of decades, had just closed a bit. It is not irrelevant to note that the transformative use argument is the main fair use defence put forward by AI developers to justify their unauthorized scraping and ingestion of copyrighted content to train generative AI algorithms. Now, on the heels of the Warhol v Goldsmith decision, we have the outcome of the two photographer’s cases against Richard Prince and the galleries. This suggests that the seemingly open-ended “transformation” standard in the US is changing, or at least that the Supreme Court’s Warhol decision is sending a message that open season on photographers (and other creative works) by appropriation artists may be coming to an end.

One of the two photography cases against Richard Prince goes back almost eight years, to about the time that Prince prevailed in the Cariou case. Graham, whose 1998 photograph “Rastafarian Smoking a Joint” was appropriated by Prince, launched his suit in 2016. McNatt’s suit, for infringement of his photograph of musician Kim Gordon, came four years later. Last year Richard Prince tried to get the cases dismissed, but the judge refused. Prince had added very little to the photographs, mostly some gibberish text, yet the “artworks” were sold for substantial sums and exhibited in the prestigious Gagosian Gallery, a co-defendant.

The cases did not go to trial by jury. On January 25, a final judgement was entered by the parties and accepted by the court in which Prince agreed to pay the damages, which were far in excess of what statutory damages would have been. While Richard Prince’s attorneys are claiming that the artist did not admit infringement, the fact that he decided to avoid going to trial and agreed to the damages is a pretty realistic appraisal of what the likely outcome of a trial would have been. Unlike a “settlement”, which the two photographers refused, a “final judgement” is not subject to a confidentiality agreement as to the terms. According to legal counsel representing the photographers, they rejected a confidential settlement (where damages could have been higher) because they wanted the appropriation issue exposed. They succeeded.

It is impossible to know precisely what impact the Warhol/Goldsmith case had on this outcome, but it is surely not coincidental that after almost eight years of litigation (in the case of plaintiff Graham) that Richard Prince decided to put this behind him and cut his losses just months after the Supreme Court’s decision. After Warhol, the Prince case marks another example of some restoration of balance to the interpretation of transformative use. It is not enough to simply add a few features to an original work, and claim it is somehow “transformed” into something entirely different. The lawyer representing the photographers described this as a David versus Goliath case, where a couple of individual photographers took on a major artist and gallery–and won. This demonstrates that fair use as applied in the US clearly has limits and that even the rich and famous can be called to account.

It remains to be seen whether this trend, which started with Warhol, will continue but it is a positive sign for artists wanting to protect their work from unauthorized reproduction and appropriation. The Warhol case has no direct legal impact outside the United States, of course, but it has been taken note of elsewhere. It could mark a turning of the tide. Proponents of further widening copyright exceptions in Canada by modifying fair dealing criteria to be illustrative, as in the US, rather than prescriptive as is currently the case, (by inserting “such as” when describing fair dealing categories) will take little comfort from this. The false allure of more permissive unauthorized copying propped up by the US transformative use doctrine has already seeped across many borders. Now perhaps the counter trend will also spread.

With respect to the Warhol case, one Canadian IP lawyer has stated “I think SCOTUS’s application of fair use to the facts, in this case, will be persuasive to Canadian courts when they have to apply fair dealing to similar facts.” While the transformation doctrine does not directly apply in Canada, it has some applicability with respect to parody. We shall see in time what the long-term impact may be. But from the perspective of creators everywhere, reinserting some much-needed balance into the US fair use transformation standard is a welcome and important development as copyright law continues to evolve.

Artificial Intelligence and Copyright: The Canadian Cultural Community Speaks Out

Image: http://www.shutterstock.com

The extended period set by the Canadian Government (through Innovation, Science and Economic Development Canada, ISED) for response to its consultation paper on Artificial Intelligence (AI) and Copyright closed on January 15. We will start to see a flurry of submissions released by participants while ISED digests and assesses the input it has received. One of the first is the submission from the Coalition for the Diversity of Cultural Expression (CDCE), which represents over 360,000 creators and nearly 3,000 cultural businesses in both French and English-speaking parts of Canada. CDCE’s membership includes organizations representing authors, film producers, actors, musicians, publishers, songwriters, screenwriters, artists, directors, poets, music publishers—just about every profession you can think of that depends on creativity, and protection for creative output. The CDCE submission highlights three key recommendations, summarized as follows;

No weakening of copyright protection for works currently protected (i.e. no exception for text and data mining to use copyrighted works without authorization to train AI systems)
Copyright must continue to protect only works created by humans (AI generated works should not qualify)
AI developers should be required to be transparent and disclose what works have been ingested as part of the training process (transparency and disclosure).

While none of these recommendations are surprising, and from my perspective are eminently reasonable, I am sure we will also see a number of submissions arguing that, “in the interests of innovation”, access to copyrighted works is not only essential but should be freely available without permission or payment. OpenAI, the motive force behind ChatGPT—and the defendant in the most recent high-profile copyright infringement case involving AI (When Giants Wrestle, the Earth Moves (NYT v OpenAI/Microsoft)—has already staked out part of this position. In its brief to the UK House of Lords Select Committee looking into Large Language Models (LLMs), a key technology that drives AI development, the company says;

“Because copyright today covers virtually every sort of human expression–including blog posts, photographs, forum posts, scraps of software code, and government documents–it would be impossible to train today’s leading AI models without using copyrighted materials (emphasis added). Limiting training data to public domain books and drawings created more than a century ago might yield an interesting experiment, but would not provide AI systems that meet the needs of today’s citizens.”

OpenAI claims that it respects content creators and owners and looks forward to continuing to work with them, citing among other things, the licensing agreement for content it has signed with the Associated Press. But failure to reach a licensing deal with the New York Times is really the crux of the lawsuit that the media giant has brought against OpenAI and its key investor Microsoft. If reports are true that OpenAI’s licensing deals top out at $5 million annually, it is not surprising that licensing negotiations between the Times and OpenAI broke down over such lowball offerings.

As for the CDCE submission to ISED, it recommends that the government refrain from creating any new exceptions for text and data mining (TDM) since this would interfere with the ability of users and rightsholders to set the boundaries of the emerging market in licensing. No copyright exemption for AI is what the British government has just confirmed, after playing footsie with the concept for over a year. Apart from the examples of the licensing deals that OpenAI has with the Associated Press and German multimedia giant Axel Springer, the CDCE paper notes a range of other recent examples of content owners offering access to their product through licensing arrangements, including Getty Images, Universal Music Group and educational and scientific publishers like Elsevier. The paper also urges the government to avoid interfering in the market when it comes to setting appropriate compensation, leaving it to market players or, where the players can’t reach agreement, to the quasi-judicial Copyright Board.

In my view, licensing is going to be the solution that will eventually level the playing field, but to get there it will require that major content players lockout the AI web-crawlers while pursuing legal redress, as the NYT is doing. This will help to open the licensing path to smaller players and individual creators who don’t have the resources available to employ either technical or legal remedies. (The issue of what has already been ingested without authorization still needs to be settled). As for the tech industry’s suggestion that creators can opt-out of content ingestion if they wish, CDCE rightly points out that this is standing the world on its head, and would be contrary to longstanding copyright practice. Not only is it impractical in a world where what goes into an AI model is a black box (thus the imperative for transparency) but it is like saying a homeowner has to request not to be burgled, or else can expect to become a target.

On the question of whether AI generated works should be granted copyright protection, CDCE points out the double-standard of proposing an exception to copyright for TDM for inputs while claiming copyright protection for AI generated outputs. The need for human creativity is a line that has been firmly held by the US Copyright Office, pushing back on various attempts to register AI-generated (as opposed to AI-assisted) works. Canada has not been quite so clear cut in its position, owing to the way in which copyright is registered (almost by default, without examination) in Canada, as I pointed out in this blog post (A Tale of Two Copyrights). While AI generated works have received copyright protection in Canada (Canadian Copyright Registration for my 100 Percent AI-Generated Work), this is more by oversight than design, given the way the Canadian copyright registration system works.

Thirdly, we turn to transparency, a sine qua non if licensing solutions are to be implemented. If authors don’t know whether their works are being used to train AI algorithms, or can’t easily prove it, licensing will fall flat. CDCE calls for publication of all content ingested into training models, disclosure of any content outputs that contain AI, and design of AI models to prevent generation of illegal or infringing content. This is similar to requirements already under consideration in the EU.

CDCE also makes the important point that it is not just copyright legislation that defends individual and collective rights against the incursions of AI and big AI platforms. While the Copyright Act offers some protection to creators, privacy legislation is important for all citizens. As the UK Information Commissioner has pointed out in a recent report, the legal basis for web-scraping is dependent on (a) not breaching any laws, such as intellectual property or contract laws and (b) conformity with UK privacy laws (the GDPR, or General Data Protection Regulation), where the privacy rights of the individual may override the interests of AI developers, even if data scraping meets other legitimate interest tests.

Finally, there is the question of the moral rights of creators that can be threatened by misapplication of AI, whether it is infringement of a performer’s personality or publicity right, distortion of their performance or creative output, misuse of their works for commercial or political reasons or any of the other reasons why copyright gives the creator the right to authorize use of their work.

Quite apart from the question of AI, there are of course other outstanding copyright questions that need to be resolved urgently, including the longstanding issue of the ill-conceived education “fair dealing” exception that has undermined if not permanently damaged the educational publishing industry in Canada. This exception needs to be narrowed to allow users continued unlicensed access to copyrighted materials under fair dealing guidelines for study, research and educational purposes but to limit institutional use to situations only where a work is not commercially available under a license from a rightsholder or collective society. While this issue requires looking back and fixing something that is already broken, policy making with respect to AI and copyright needs to anticipate the future and “do no harm”, while requiring AI developers to open up their black boxes and respect existing rights. This should be achieved by maintaining and protecting the rights of creators in ways that will facilitate market-based licensing solutions for use of copyrighted content by AI developers, while ensuring that creative output remains the domain of human beings, and not machines.

When Giants Wrestle, the Earth Moves (NYT v OpenAI/Microsoft)

Image:www.shutterstock.com

There is no better way to start out the New Year, 2024, with a commentary on Artificial Intelligence (AI) and copyright. It was the big emerging issue in 2023 and is going to be even bigger in 2024. The unlicensed and unauthorized reproduction of copyright-protected material to train AI “machines”, in the process often producing content that directly competes in the market with the original material, is the Achilles heel of AI development. To date, no one knows if it is legal to do so, in the US or elsewhere, as the issue is still before the courts. The cases brought to date by artists, writers and image content purveyors like Getty Images have not always been the strongest or best thought out. In one instance, the plaintiffs had not even registered the copyright on some of the works for which they were claiming infringement, a fatal flaw in the US where registration is a sine qua non in order to bring an infringement case. That may have been the most egregious example of a rookie error but in general the artists’ and writers’ cases have not gone too well so far, although the process continues. Some cases are on stronger grounds than others. Here is a good summary. The Getty Images case will be an interesting one to watch. And now the New York Times has weighed in with a billion-dollar suit against Open AI, and Microsoft. The big guys are now at the table and the sleeves are rolled up. The giants are wrestling.

What is at issue could be nothing less than the survival of the news media and the ability of individual creators to protect and monetize their work. It could also open a pathway to legitimacy for the burgeoning AI industry. The ultimate solution is surely not to put a halt to AI development, nor to put content creators out of business. It is to find a modus vivendi between the needs of AI developers to ingest content in order to train algorithms that will “create” (sort of) content–assembled from vast swathes of input–and the rights of content creators. While training sets are generally very large, some of the input can be very creator-specific and the output very creator-competitive. This is where the New York Times comes in.

The Times, like any enterprise, needs to be paid for the content it creates in order to stay in business and create yet more content. If its expensively acquired “product”, whether news, lifestyle, cooking, book reviews or any of the other content that Times’ readers crave and are willing to pay for, can be obtained for free through an AI algorithm (“What is the most popular brunch recipe in the NYT using eggs, bacon and spinach”, or “What does Thomas Friedman think of…..”), this creates a huge disincentive to go to the source and undermines journalism’s business model, already under severe stress and threat.

The Times is one of the few journals that has managed to thrive, relatively speaking, in the new digital age at a time when many of its competitors are dying on the vine. According to Press Gazette, the New York Times is the leading paywalled news publisher, with 9.4 million subscribers. (Wall Street Journal and Washington Post are numbers two and three respectively). You need to pay to read the Times, and why not? But paying for access does not give you the right to copy the content, especially for commercial purposes. (The Times offers various licensing agreements for reproduction of its content, with cost dependent on use). Technically, all it takes is one subscription from OpenAI and the content of the Times is laid bare to the reproduction machines, the “large language models”, or LLMs, used by the AI developers. The Times has now thrown down the gauntlet. Its legal complaint, 69 pages long, makes compelling reading. If there ever was a “smoking gun” putting the spotlight directly on the holus-bolus copying and ingestion of copyright protected proprietary content in order to produce an unfair directly-competing commercial product that harms the original source, this is it. It’s a far cry from earlier copyright infringement cases brought by some artists and writers.

While you can read the complaint yourself if you are interested (recommended reading), let me tease out a few of the highlights. After setting out the well-proven case for the excellence of its journalism, the Times’ complaint notes that while the defendants engaged in widespread copying from many sources, they gave Times’ content particular emphasis when building their LLMs, thus revealing a preference that recognized the value of that content. The result was a free ride on the journalism produced at great expense by the Times, using Times’ content to build “substitutive products” without permission or payment.

Not only does ChatGPT at times regurgitate the Times’ content verbatim, or closely summarizes it while mimicking its style, at other times it wrongly attributes false information to the Times. This is referred to in AI circles as “hallucination”, something the complaint labels misinformation that undermines the credibility of the Times’ reporting and reputation. Hallucination is a particularly dangerous element of AI produced content. Rather than admitting it doesn’t know the answer, the AI algorithm simply makes it up, complete with false references and attributions all of which make it very difficult for the average reader to separate fact from fiction. This misinformation is the basis of the Times’ complaint for trademark dilution that accompanies various other copyright related complaints of infringement. Concrete examples of such misinformation are provided in the complaint.

So too is ample evidence of users exploiting ChatGPT to pierce the Times’ paywall, by asking for the completion of stories that have been blocked for non-subscribers. There are concrete examples of carefully researched restaurant and product reviews that have been replicated virtually verbatim. Not only is the Times’ subscription model undermined, but the value it derives from reader-linked product referrals from its own platform bleeds to Bing when the product is accessed through Microsoft Search enabled by ChatGPT. Examples are given of full news articles based on extensive Times’ investigative reporting being reproduced by ChatGPT, with only the slightest variations. These are not composite news reports of what is happening in Gaza, for example, but a word-for- word lifting of a Times’ analysis of what Hamas knew about Israeli military intelligence. The Times’ complaint makes for chilling reading. AI’s hand has been caught firmly in the cookie jar.

What does the Times want out of all of this? The complaint does not specify a dollar amount, while noting the billions in increased valuation that has accrued to OpenAI and Microsoft as a result of ChatGPT. However, it asks for statutory and compensatory damages, “restitution, disgorgement, and any other relief that may be permitted by law or equity” as well as destruction of all LLM models incorporating New York Times’ content, plus, of course, costs. If the Times gets its way, this will be a huge setback for AI development as well as for OpenAI and Microsoft, but of course it may not come to that. The complaint notes that the Times had tried to reach a licensing deal with the defendants. OpenAI cried foul, expressing “disappointment”, and noting that they had been having “productive” and “constructive” discussions with the Times over licensing content. However, to me this is a bit like stealing the cookies, getting caught red-handed and offering to negotiate to pay for them, then crying foul when your offer is rebuffed. The Times has just massively upped the ante, making the potential licensing fees much more valuable.

The irony is that the use of NYT material by OpenAI or indeed other platforms like Google or Facebook potentially brings some advantage and drives some business to the Times, while obviously also providing commercial benefits to the AI program, search engines or social media platforms. The real question will be how that proprietary content is used, and how much is paid to use it. A similar issue is being played out in another context, most recently in Canada with Bill C-18 where news media content providers wanted the big platforms (Google and Meta/Facebook) that derive benefit from using or indexing that content to pay for accessing it. The result in Canada was both a standoff and a compromise. Facebook blocked Canadian news content rather than pay for it, while Google agreed to create a fund for access by the news media in return for being exempted from the Canadian legislation.

The NYT-OpenAI/Microsoft lawsuit is a different iteration of the same principle. Businesses that gain commercial advantage from using proprietary content of others should contribute to the creation of that content, either through licensing or some other means such as a media fund. The most logical outcome of the Times’ lawsuit is almost certainly going to be a licensing agreement. Given the seemingly unstoppable wave of AI development, meaningful licensing agreements would seem to be the best way to ensure fairness and balance of interests going forward.

A Goliath like the New York Times is in a much better position to make this happen than a disparate group of writers and artists. Indeed, there are logistical challenges in being able to license the works of tens of thousands of content creators. In an earlier blog post, I postulated that perhaps copyright collectives might find a role for themselves in this area in future. In my view, ultimately the only logical solution to the conundrum of respecting rights-holders while facilitating the development of AI is to find common ground through fair and balanced licensing solutions. The wrestling giants of the NYT and Microsoft may help show the way.

As Creator’s Rights Face New Challenges, Canada Needs to Keep Pace with International Developments

Image by Greg Altmann/Pixabay

This blog post appeared first in Open Canada, the journal of the Canadian International Council, on November 20, 2023.

In the past few weeks there has been a flurry of activity with respect to international regulation of Artificial Intelligence (AI) such as the Bletchley Declaration spearheaded by UK Prime Minister Rishi Sunak, the Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence signed by US President Biden, as well as the G7 AI Code of Conduct. Canada has been involved in some of these initiatives but will be affected whether or not it participates, including aspects of the AI issue dealing with protection of intellectual property, specifically creator’s rights protected through copyright laws. Indeed, there is a huge emerging issue related to whether the indiscriminate scraping of copyrighted content by AI developers to train their algorithms is legal under existing copyright laws, plus whether the output of content generated by AI can be legally protected under accepted copyright norms.

When it comes to copyright challenges today, Canada has just launched a public consultation on this issue (”Copyright in the Age of Generative Artificial Intelligence”) as part of the process of updating Canada’s copyright framework in the digital age. The implications of the extent to which AI and copyright are compatible illustrate the interdependent nature of national copyright protection regimes, notwithstanding the fact that each nation interprets and applies copyright law in slightly different ways. The key point here is that countries that are too lax in protecting their creative sectors could see their copyright-protected cultural industries suffer negative economic impact; countries that are overly protective could see investment in AI innovation flow to countries with lower copyright standards. Whatever international consensus emerges and whatever framework to regulate AI is developed, whether it be OECD guidelines or a more formal arrangement, Canada will need to be a party. Such is the nature of international issues these days, with respect to digital issues, copyright and intellectual property generally.

Canada is already bound by a number of international commitments with respect to its application of copyright, and these will undoubtedly have an impact on future and long overdue revisions to Canada’s Copyright Act. For example, the current international framework for protection of copyrighted works (books, films, music, performances, television and streaming content, broadcasts and other forms of copyright protected works such as software, paintings, drawings, photographs, etc.) is embedded in the TRIPS Agreement (WTO Agreement on Trade-Related Aspects of Intellectual Property Rights) that was a part of the establishment of the World Trade Organization in 1995. Canada, was of course, a party to TRIPS. With respect to copyright, TRIPS incorporates the terms of the Berne Convention, with the added benefit of a dispute-settlement mechanism to resolve disputes, something lacking in Berne. However, the WTO’s dispute settlement process is currently suspended owing to the inability to appoint new members to the WTO’s Appellate Body because of US opposition. The Berne Convention of 1886 (along with its periodic updates over the years) remains the bedrock of international copyright cooperation.

When it comes to copyright legislation, it is generally accepted that the first modern copyright law is the Statute of Anne, passed by the British Parliament in 1710. The stated purpose of legislation was for “the encouragement of learning”. For the first time it gave authors (or those to whom they assigned their rights) rather than printers the exclusive right to print or reprint their books. The period of protection lasted for an initial period of fourteen years. This provision was included in the US Constitution “to promote the progress of science and useful arts…”, again with an initial period of protection of fourteen years.

During the 18^th and most of the 19^th century, copyright laws were applied to nationals only of the country concerned or to works first published in a that country. Thus, British copyright applied in Britain (and the British Empire) to British authors but works by nationals of other countries could be freely reprinted in Britain unless first published there. The same applied in the US and other countries. Attempts were made to negotiate bilateral treaties under which reciprocal protection would be afforded the nationals the two countries concerned, but this resulted in a confusing patchwork quilt of protection. Eventually, under the leadership of the French novelist Victor Hugo, in 1886 the first international copyright treaty, the Berne Convention, was signed. Only eight countries ratified it initially, (Belgium, France, Germany, Great Britain, Italy, Spain, Switzerland and Tunisia). Notably absent was the United States which did not join Berne until 1989. Today, over 180 countries are members and some economies (like Taiwan, Hong Kong and Macao) that are not accessory states to Berne but are members of the WTO) also apply its terms.

When Britain joined Berne in 1886, the Convention’s provisions applied to all parts of the British Empire, including Canada, as Canada was not at that time a fully sovereign state. Nonetheless, copyright was a power conferred on the new dominion established in 1867 and in 1868 Canada enacted its first Copyright Act. This ambiguity led to conflicts with the imperial government, and on several occasions Canada tried to exit Berne, before acceding in its own right in 1928. Canada also tried to pass legislation favouring Canadian works over those from Britain, only to have the legislation vetoed by the Governor-General.

One of the issues was Canada’s desire to promote the Canadian printing industry. British works were protected by copyright in Canada but Canadian printers could normally not get printing rights from British publishers, despite the high cost of the imported British books. However, in the US, British works were freely printed without permission (“pirated”) because US copyright law did not protect British works. Canadian booksellers, instead of importing the expensive British editions of Charles Dickens and other British writers, would import the much cheaper pirated US editions. This was technically illegal, but the border was long and leaky. British publishers tried to pressure the British government to lean on Canada to block importation of their works printed in the US, but with limited success.

Just as British works were not protected in the US, nor were US works protected in Britain or other countries such as Canada. Thus, Canadian printers freely reprinted Canadian editions of US works by writers such as Samuel Clemens (Mark Twain), without permission or payment of royalties. That was legal at the time but what was not legal was the resale of these Canadian editions back into the US, a frequent occurrence. Thus, Clemens famously complained about “Canadian pirates” and tried to publish some of his works first in Montreal so he could claim British and Canadian copyright. Finally in 1891, the US agreed to respect the copyrights of other nationalities but only on condition that their works be typeset in the US.

For many years before it finally joined Berne in 1989, US publishers sought to obtain the benefits of Berne’s widespread international protection (applicable only to acceding parties) by simultaneously publishing works in the US and in Canada, through their Canadian publishing subsidiaries. This became known as “the back door to Berne”. Berne establishes a number of basic principles and commitment to minimum levels of protection by acceding states. For example, under Berne no formal registration is required to establish copyright provided that the fundamental requirements of originality, nationality and fixation are met, although registration can be provided as an option as is the case in both Canada and the United States. In the US registration is required if a legal action is taken to enforce a copyright. Berne also requires a minimum term of protection of the life of the “author” (meaning the creator of the work, even a visual work) plus 50 years after the author’s demise, although countries are free to establish a longer period of protection. The US, EU, and a number of other states, now including Canada, have extended the duration of copyright protection to “life plus seventy”, with a twenty-year extension allowing an author’s estate, or those who have acquired the rights, to have a longer period during which to exploit the work.

A key principle under Berne is “national treatment”. That is, each country is required to apply the provisions of the Convention within its area of jurisdiction to both nationals and non-nationals on an equitable basis consistent with Berne’s minimum standards. Today Canada and the US are both parties not only to Berne but also to many of the myriad of specialized copyright treaties, such as the “Marrakesh Treaty to Facilitate Access to Published Works for Persons Who Are Blind, Visually Impaired or Otherwise Print Disabled”, which establishes exceptions to copyright for visually disabled people.

It is not only international treaties that impose certain commitments on Canada, but also bilateral agreements such as the updated NAFTA, the CUSMA (called the USMCA in the US). One of the commitments that Canada made in CUSMA was to extend its term of copyright protection to align with that in the US. The implementing legislation for this commitment has now been enacted and the longer term of copyright protection came into effect in Canada on December 30 2022. However, the longer term applies only to works still under copyright protection. Any works that entered the public domain prior to that date do not benefit.

Given recent Canadian government initiatives, such as Bill C-11 (the Online Streaming Act) and C-18 (Online News Act), both of which will require US companies ranging from Netflix and Disney to Facebook and Google to contribute financially to production of Canadian content, in the case of streaming, or in the case of C-18 and news content, to Canadian journalism, one could well ask whether the US will try to intervene on behalf of these large US content and tech companies. After all, one of the basic principles of CUSMA is national treatment for US companies in Canada, and vice versa, with specified exceptions.

One of these exceptions is the so-called cultural exception, Article 32.6 of CUSMA, which relates to what could be called “copyright industries”. This article allows Canada to take actions to protect culture in ways that would be inconsistent with the Agreement but for the exception. Film and television production, as well as the publication of magazines, periodicals and newspapers, and radio, TV and cable broadcasting, are all included in the definition of a cultural industry. However, Article 32.6 has a sting in its tail. It allows the other parties (the US or Mexico) to take equivalent measures of retaliation in any sector of the economy if the cultural exception is invoked. In effect this means that if Canada uses the cultural exception to justify measures against US (or Mexican) companies, other sectors of the Canadian economy could suffer the consequences. As such, it is a poison pill, which explains why it is very improbable it will ever be used. Instead, if there is a US trade challenge to these pieces of legislation – which is unlikely given the range of US interests involved, (some of which support the legislation) – the Canadian government will not invoke the cultural exception but will argue the measures it is implementing are not aimed at US companies per se, but rather at specific commercial entities that have an excessive degree of competitive market power. Thus, there is no violation of the national treatment principle. At the present time, the only companies that fit the definition happen to be American, but in future the definition could extend to European companies or Chinese entities like TikTok or, potentially, Canadian companies.

All this just goes to show that no nation is an island, whether it concerns specialized areas like copyright or broader issues like AI harms. Copyright has adapted over the years to technological change, with AI being but the most recent example. Likewise, Canada has adjusted to the international framework regulating copyright, to its advantage and to the benefit of its creative industries, and it will need to continue to do so in future.

Tag: Copyright

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