More lawsuits expected against pirate satellite TV dealers as ExpressVu, three major broadcasters launch $100-million suit

Canada’s broadcast industry is stepping up legal pressure against black and grey market satellite TV dealers in the wake of a CRTC decision last week in which the commission washed its hands of the issue. Bell ExpressVu LP, CTV Inc., Alliance Atlantis Communications Inc. and Astral Media Inc. filed a $100-million lawsuit in the Federal Court of Canada last week over the piracy of satellite television signals in Canada. The move finally puts broadcasters in the litigation mix on the piracy matter. Cablecos haven’t joined the suit. Janet Yale, president and CEO of the Canadian Cable Television Association (CCTA), points out that the cable industry is planning to launch suits of its own. "There are a number of different legal initiatives that are being contemplated," she tells Canadian Communications Reports. "ExpressVu was ready to go forward with this particular one, and there is another one that is being worked on on behalf of all the other members of the coalition. And we’re hoping to file that within a month." Yale notes that there will be a slightly different angle to that suit, and that the list of dealers to be named is in the process of being finalized. She notes, however, that there could be some overlap with those named in the lawsuit launched by Bell ExpressVu, CTV, Alliance Atlantis and Astral. "There may be some overlap. But obviously from our perspective, it would be better to target dealers that don’t already have court cases initiated against them so we can cast the net as wide as possible between the various lawsuits that are underway." Until this point, distributors were the most visible in the anti-piracy campaign, with Shaw Communications Inc. CEO Jim Shaw even blasting the broadcasters in April for what he saw as their inaction on the piracy front (CCR, April 25/02). It was satellite TV distributor Bell ExpressVu that carried the case to the Supreme Court of Canada, which confirmed that both the black and grey market were illegal (CCR Update, April 26/02). And it was the CCTA, on behalf of a wider anti-piracy coalition, that complained to the CRTC about CTY Telecom, a black market dealer that the cable association claimed was in effect acting as a broadcast distribution undertaking (BDU) without a licence. The lawsuit launched last week names various black and grey market dealers across the country, many of which operate under multiple names. Those named in the suit include Toronto-based CTY Telecom, which also operates under the name Direct TV Canada Company, and Winnipeg-based Freeway Support Services. Freeway Support Services owner Jim Woods spoke freely about his activities to CCR last year (CCR, March 14/01). Other defendants listed are Ottawa-based Arab-SAT Ottawa International Satellite Service, Surrey BC-based Visions Electronics Ltd., and Winnipeg-based Starlink Canada Satellite. The plaintiffs are seeking $90 million pursuant to Section 18(1) of the Radiocommunication Act, and aggravated, exemplary or punitive damages of $10 million as well as court costs. They are also seeking an interim injunction that would prevent the defendants or anyone acting on their behalf from "manufacturing, importing, distributing, leasing, offering for sale, selling, installing, modifying, operating or possessing any equipment or device, or any component thereof, that has been used, is being used or is intended to be used" to decode the encrypted subscription programming signals of unlawful distributors in Canada, such as DirecTV Inc., and EchoStar Communications Corp., operating under the name Dish Network. The three broadcasters and Bell ExpressVu are also requesting an order requiring the defendants to immediately deliver or destroy all the equipment or devices in their possession, power or control. "The plaintiffs state that the actions of each of the defendants have caused and will continue to cause them damages, including but not limited to, loss of revenue, profit and income, as well as loss of goodwill and have impaired and will continue to impair their lawful business endeavours. Full particulars of the damages sustained by the plaintiffs will be provided prior to trial," reads the statement of claim filed October 18 with the trial division of the Federal Court. The plaintiffs have 30 days after the statement of claim is served on them to file their statement of defence if they are served within Canada, 40 days if served within the United States and 60 days if served outside Canada or the United States. The lawsuit has been filed amid complaints by the anti-piracy coalition that not enough has been done to enforce the Supreme Court decision (CCR, Sept. 26/02). The coalition includes the CCTA, the Canadian Association of Broadcasters (CAB), the copyright collectives, DirecTV Inc., the Canadian Television Fund (CTF), the Canadian Film and Television Production Association (CFTPA), Bell ExpressVu, Star Choice, and the North American Broadcasters Association (NABA). After seven months of mulling over the CCTA complaint against CTY Telecom, the CRTC said last week that it would not pursue the company because the complaint was outside its jurisdiction – Broadcasting Decision 2002-319. During the CRTC process, CTY admitted to grey and black market activity, but argued it was not a BDU because it does not provide retransmission, uplinking or scrambling facilities for any U.S. satellite service. The commission ruled that CTY was not acting as a BDU, as "there is insufficient evidence on the record to sustain a finding that CTY selects, gathers, packages, or distributes signals." The CRTC passed the complete file on to Industry Canada, which is responsible for the Radiocommunication Act, which prohibits grey and black market activity. The CRTC also wrote to EchoStar Communications Corp. on October 18, asking the U.S. satellite TV operator to indicate whether CTY’s activities were being carried out with its knowledge or consent. Yale is disappointed with the CRTC’s decision. "I thought this (the CRTC process) was a great opportunity to show some leadership on this issue to other parts of the government, and to take a tough stand against the dealers," she says. "I certainly understand that they felt the legal argument was not as strong as they would like it to be…but what we’re looking for is some sign from government that they take the issue seriously. We’re looking for actions that can be taken to chill the market…I think of it as a missed opportunity, even if it had been taken to court (by the defendants)." The CRTC’s response is a disappointment to the CCTA, particularly after CRTC chair Charles Dalfen pledged at the CCTA’s convention this year to support the industry’s anti-piracy efforts (CCR, April 25/02). In his speech at the CAB convention this week, Dalfen briefly mentioned the piracy issue. "The Supreme Court has spoken very clearly, and it’s now up to us – in government and industry – to ensure that our healthy broadcasting industry doesn’t get bled to death by illegal signal theft," he said. The CRTC decision on CTY also notes: "The commission emphasizes that it does not condone the grey and black market activities clearly admitted to by CTY in the course of this proceeding…It is committed to take all measures at its disposal to limit such activities." CRTC spokesperson Denis Carmel tells CCR that the recent CTY decision doesn’t mean that the commission will steer clear altogether of the issue. He points out, for example, that when Bell ExpressVu and Star Choice appear before the CRTC for their licence renewals, there are bound to be interventions that focus on the security of their satellite systems. At that point, Carmel says the commission could delve into the measures that are being taken to protect the integrity of those systems. At a session on piracy at the CAB convention, the coalition also unveiled plans for a national public awareness campaign against satellite signal theft that it anticipates rolling out this month. The campaign, which will begin in the print and radio media and then move to television, is aimed at reinforcing to the public that using illegal cards is theft. The campaign will run until the end of December, covering the Christmas buying season. The print ad released at the convention states: "Theft if theft. Stealing satellite signals is no different. The law is clear. On April 26, 2002, the Supreme Court of Canada upheld a law making the theft of satellite signals illegal in Canada." The radio ads feature an announcer doing segments on "Installing Your Illegal Satellite." One draws a moral link, and asks if your kids will think it is okay to steal since you have an illegal satellite. In another, the announcer discusses the problem of not being able to get reception once a card has been zapped. Direct TV Enterprises VP Larry Rissler, the only American representative on the piracy panel, expressed support for both the legal action and the public awareness campaign.

More lawsuits expected against pirate satellite TV dealers as ExpressVu, three major broadcasters launch $100-million suit

Broadcast | October 24, 2002

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