Law Times

Law Times • JuLy 25, 2016 Page 9 www.lawtimesnews.com Users stream copyrighted material from the Internet Case over set-top boxes could set precedent BY YAMRI TADDESE Law Times I n a case lawyers say has the potential to set a new preced- ent in copyright law, a group of Canadian broadcasters has obtained an interlocutory in- junction against a number of businesses selling pre-loaded set-top boxes that allow users to stream copyrighted material from the Internet. A growing trend in the en- tertainment market, the plug- and-play boxes offer a range of streaming apps on users' TV screens and allow for easy downloading. In Bell Canada et al v 1326030 Ontario Inc dba IT- VBox.net et al, one of the de- fendants argued it simply sells hardware that allows users to stream content online using al- ready available apps that users could find elsewhere. But the Federal Court rejected that argument in a preliminary rul- ing, saying the defendants act- ively encourage users to defy copyright laws. "This is not a case where the defendants merely serve as the conduit, as was argued by Mr. [Vincent] Wesley," wrote Federal Court Justice Danièle Tremblay- Lamer, referring to one of the defendants. "Rather, they deliberately en- courage consumers and poten- tial clients to circumvent autho- rized ways of accessing content — say, by a cable subscription or by streaming content from the plaintiffs' web sites — both in the manner in which they promote their business, and by offering tutorials in how to add and use applications which rely on illegally obtained content," Tremblay-Lamer also said. The judge said the businesses market themselves with slogans like "original cable killer" and tell consumers to "cancel cable today." "In my view, the only reason why many users have access to infringing content is because set- top boxes preloaded with KODI (and the proper add-ons), Show- box or a private IPTV service make it extremely easy to do so," the judge added. "While some consumers might have the desire and technical knowledge to seek out and download such applica- tions, many others might not." Charles Wagman, counsel for a number of the respondents, says the judge didn't like the fact that these devices make stream- ing easier. "But the fact is, you can go to your Android phone or your computer and you just type in KODI or type in Showbox, and follow the prompts and in about one minute, you'd have all of the programming you'd otherwise get from this box," Wagman says. "[The judge's view] was, 'Yeah, but it made it easier.' Well, it's already easy," he adds. The case, Wagman says, is "extremely interesting" from a legal point of view. For one, Bell doesn't have copyright on the contents in question; it simply distributes them, Wagman says, adding it's highly unusual that an entity that does not own copy- right would seek to enforce it. "The one who has copyright is the company that produced the movies, whether it's HBO or Fox TV or whomever," Wagman says. Companies such as Bell and Rogers have the right to broad- cast the content based on their agreement with the producers "but that doesn't give them the right to enforce the copyright," he adds. François Guay, counsel for the plaintiffs, did not respond to a request for comments. Catherine Lovrics, partner at Bereskin & Parr LLP, says the case could be precedent-setting if the court finds the defendants liable for inducing copyright in- fringement by users. "If the case goes to trial, a de- cision on whether or not 'autho- rizing' under Canada's Copy- right Act includes the concept of 'inducement' would be prec- edential," she says, adding that to date, the word "authorizing" under the law has not been in- terpreted so broadly as to mean inducement. Such interpretation is more common in the U.S., Lovrics says. "Typically, you need to exer- cise some control over the abil- ity to copy . . . rather than just, you know, egging someone on or promoting, encouraging, and facilitating their ability to in- fringe," Lovrics adds. "In this case, you're providing a device and you've advertised in a way that sort of holds some- one's hands and walks them to the point where they can in- fringe, but [the defendants] are not the provider of the app so they don't actually have control over the person's ability to use the app or not," she continues. "This is in my view more of a case of inducement than a case of authorizing." Recent changes to the Copy- right Act in fact address services that enable acts of copyright in- fringement, Lovrics also says, but the provisions don't squarely address devices. "It is an infringement of copyright for a person, by means of the Internet or another digi- tal network, to provide a service primarily for the purpose of enabling acts of copyright in- fringement if an actual infringe- ment of copyright occurs by means of the Internet or another digital network as a result of the use of that service," the act reads. Wagman says this case is not about a service but the sale of a device. Whether there is a copy- right infringement in this case is still to be determined at trial. "This is a motion for injunctive relief with respect to an emerging phenomenon in the Canadian market, that of pre-loaded plug- and-play set-top boxes. These boxes have several uses for con- sumers, some of which are per- fectly legal and some which skirt around the fringes of copyright law. This is not the first time a new technology has been alleged to violate copyright law, nor will it be the last," Tremblay-Lamer said in his ruling, noting "these are questions for the Court to resolve at trial rather than at this inter- locutory stage. "For the time being, I am satis- fied that the plaintiffs have estab- lished a strong prima facie case of copyright infringement and that an injunction would prevent ir- reparable harm without unduly inconveniencing the defendants," Tremblay-Lamer said. The judge added: "The mar- ket for pre-loaded set-top boxes will keep growing if left un- checked and the defendants, or any defendant that may be added to the present claim, are unlikely to have the financial resources required to compen- sate the plaintiffs for their losses should the latter succeed on the merits." LT FOCUS Catherine Lovrics says a Federal Court case could be precedent-setting if the court finds the defendants liable for inducing copyright infringement by users. 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