No knockout blows, but signs encouraging for ISPs at Supreme Court showdown

With little more to go on than body language and a few skeptical questions from the bench of the Supreme Court of Canada, hardcore gamblers might still want to place a fin on the Internet service providers (ISPs) in their ongoing battle with the music industry. No knockout blows were scored by either side on December 3 as each made its case for and against ISP licence fees for downloaded music - Tariff 22 - but some pointed queries from the bench seemed to indicate sympathy for the ISPs’ position that artists won’t be denied royalties if an original decision by the Copyright Board of Canada on the matter stands. The two parties and their allies made their final arguments to the Supreme Court as part of an appeal and cross-appeal seven years in the making since the original filing of Tariff 22 with the Copyright Board in 1996. A final decision on whether ISPs owe the music industry licence fees, whether ISP-run caches should be treated separately, and whether music stored in the U.S. triggers copyright liability here is likely months away. But the tea leaves look encouraging for ISPs as the justices hearing the case on December 3 shook up a snoozy affair as the music labels took the stand to make their arguments. While the judges listened almost without interruption to the ISPs’ arguments for an hour to begin the hearing, the music industry’s legal counsel George Hynna was able to speak for only a few minutes before Justice Michel Bastarache interrupted prepared remarks. Hynna had been addressing the need to have a right attached to Internet communications recognized in Canada so that copyright collectives here could negotiate reciprocal arrangements with their U.S. and other counterparts. His point, however, was interrupted several times by Bastarache and Justices Frank Iacobucci, Ian Binnie and Louis LeBel. Each had hard questions for Hynna about the music industry’s assertion that it would be unable to pursue royalties from U.S. content providers, asking several times about the role of such U.S. copyright collectives as BMI and ASCAP. Their questions followed almost an hour of stony silence as they absorbed the ISP arguments made by legal counsel Thomas Heintzman. Heintzman had submitted that BMI and ASCAP, and similar organizations around the world that have ties to Canada through copyright treaties, would be able to collect royalties on behalf of the Canadian music industry. Skeptical questionsThe bench had further questions for Hynna, who at times appeared flustered by the judges’ questions and thrown off his rhythm. While some justices stifled yawns and were visibly less interested in following written case materials than they were during Heintzman’s presentation, Hynna was asked by a skeptical Bastarache whether charging licence fees to ISPs could create uncertainty in the market by adding multiple layers in the system at which payments must be made - an assertion the lawyer denied. Binnie hit on one of the most salient points of the morning hearing soon after when he asked Hynna: "Aren’t you just trying to unload the problem (of lost revenue to downloading) on the ISPs?" The question hit at the heart of an increasing concern on the part of ISPs that they are being looked to increasingly to solve issues such as spam, lawful access and copyright. Hynna said that ISPs would be asked to shoulder some of the burden of copyright liability for music, but added, "I wouldn’t look at it as passing it on." He noted that ISPs are in business to facilitate communications between content holders and users - "otherwise, they wouldn’t be here…There is no reason why they should not be paid for the royalties." Technology neutrality urgedBastarache hinted at his own sympathy for the ISPs’ position when, on the matter of levying royalties against music stored in caches, he asked, "why shouldn’t they be considered just another type of router?" Hynna countered that a cache is used to make the ISPs’ business more attractive and thus couldn’t be considered necessary to the functioning of the Internet. Iacobucci leveled a damning appraisal against the music industry’s case when he said he was having difficulty understanding the root of its submission. "I don’t see what statutory context and principles are being applied," he said. "I think it pre-judges the technology." Hynna noted, however, that Parliament is still struggling with digital copyright reform, and that the exception upon which ISPs rely to be considered dumb pipes was never intended to cover all technologies. He added that there is no legislation, currently, dealing directly with the Internet. "We do not know what Parliament will do. We should not presume that," he said.

No knockout blows, but signs encouraging for ISPs at Supreme Court showdown

News | 12/04/2003 5:00 am EST

Unlock all the Canadian telecom, broadcasting and digital media news you need.

FREE TRIAL

SUBSCRIBE

Reuse & Permissions

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us