Recording industry sees victory in ruling, will pursue suits despite loss

A jubilant Canadian Recording Industry Association (CRIA) will likely be back in court within about a month to bring a fresh spate of suits against Canadians it believes are illegally sharing music files over the Internet. On May 19, the Federal Court of Appeal dismissed CRIA’s appeal of a Federal Court of Canada ruling barring it access to the records of 29 Canadians it was hoping to sue (the BMG case). Despite the loss, CRIA head Graham Henderson tells CNM that the setback is temporary, and the higher court ruling has paved a clear path to more future successful actions. For over a year, CRIA has been attempting to bring a slew of copyright infringement suits against a group of nearly 30 individuals whose information it collected from the KaZaA file-sharing network (CNM, Feb. 20/04). With only IP addresses and online nicknames to go by, CRIA was forced to seek a motion in court that would compel the ISPs that provided those individuals with Internet access to divulge their identities. Federal Court of Canada judge Konrad von Finckenstein rebuffed a first attempt in court just over a year ago. The jurist’s decision was reached after he concluded the evidence presented by CRIA was too full of holes to support the invasion of the subscribers’ privacy that granting the motion would have led to. CRIA immediately appealed that ruling, saying von Finckenstein held its case to too high a standard (CNM, July 23/04). Last week, the appeal court upheld von Finckestein’s original ruling, citing serious privacy concerns, and saying the evidence linking the IP addresses and nicknames to actual subscribers is too tenuous. Henderson, however, says the loss was just one step in the recording industry’s battle to begin bringing alleged copyright infringers before the courts. He adds the decision was a positive development. He notes that in the unanimous three-judge ruling, several problems that were pointed out with CRIA’s evidence can be changed for future suits, and he’s pleased with the new standard the court has established for motions to get at subscriber info held by ISPs (see sidebar). Proof that CRIA wasn’t on the losing side of the decision, states Henderson, is the court’s decision not to award costs in the legal battle. "Losers are supposed to pay the bills," he says. "The court has laid out a landing strip with the lights all lit up," he says. He notes that the association was already collecting a fresh batch of names in the immediate wake of the court’s ruling, and that CRIA will bring a new motion for the disclosure of those individuals – likely within weeks. "Let the education lesson begin," Henderson says. The May 19 decision should put an end to the waiting game of the original 29 individuals whose legal fate was at question in the process. The court was at pains in its decision to stress the need for speed in seeking the identity of people once their IP addresses have been collected. Information about the original group of 29 was collected well over a year ago, and it’s unlikely any court will look favorably at dredging that information out of the ISPs’ vaults at this stage. Fresh evidence would likely need to be collected on those people, which could prove difficult to obtain. Speaking on condition of anonymity with CNM last winter, one of the 29 individuals whose identity was being sought said he’d ceased using the KaZaA file-sharing network by the time CRIA’s motion had been filed. Though he did not rule out continued action against the original group, Henderson says he has little interest in pursuing them further as CRIA puts together its next spate of cases. "They can consider it a lesson learned and bullet dodged," he says. Lawyers on the other side of the fence say they’re pleased that the Federal Court of Appeal has upheld the earlier decision not to compel ISPs to divulge those individuals’ information, but express concerns about the new standard laid down by the court for future cases. Pippa Lawson, the head of the Canadian Internet Policy and Public Interest Clinic, which argued against disclosure on public interest grounds in the case, says she’s disappointment that the bar for evidence has been lowered. She notes that the court has pronounced strongly in favour of privacy rights, ruling that the privacy impacts of copyright investigations must be mitigated. In its decision, the court not only ruled that there should be little delay between investigation and a motion for disclosure, but also noted that plaintiffs in future cases will have to ensure that they don’t collect more information than they need to pursue a copyright case, and finally that orders for the disclosure of information should be carefully and narrowly drafted by courts in an effort to protect as much as possible an individual’s privacy. But, Lawson notes that there is nothing in the decision to deter CRIA from pursuing similar cases in the future. "They’re essentially being told to go back to the drawing board if they want to go ahead with these lawsuits. They’ve got to do a better job with the evidence and a better job respecting the privacy of the individual defendants they’re going after." Lawyer Howard Knopf, one of those who argued the case before the court, also expresses disappointment about the ruling overall and the path it seems to lay out for CRIA moving forward. "We’re somewhat disappointed that it does open the door to the kind of shock and awe and the statutory damages crap that we’re seeing…in the United States. It opens the door, but it doesn’t lay down a red carpet. They’ve still got to be willing to provide the evidence they’ve so far been unwilling and unable to provide." Lawson also expresses her view that the court’s evidentiary guidelines laid down for future cases don’t make CRIA’s future suits a slam-dunk. She notes that it won’t be easy to limit the evidence gathering, for instance. In her review of the evidence in the case of the 29 individuals in this case, she says CRIA dug up files being shared by the users that might be considered "sensitive personal information." Lawson doesn’t say what those are, but KaZaA, besides being used extensively to share music files, is also used by many to download adult video and picture content, as well as software. While the Federal Court of Appeal’s decision is most noteworthy for its pronouncements on how to proceed with future disclosure motions, scholars and industry observers are also pondering two important consequences of this month’s decision. Public interest advocates say the decision puts the evolution of digital copyright reform back to where it was before the suits began, with the sharing of files in shared drives back in a legal grey area. Knopf notes that CRIA has argued extensively in past that such activity is illegal under existing law, and that the decision should take the wind out of CRIA’s sails for pursuing a new legislated right of making available – the centrepiece of Ottawa’s proposed copyright legislation to bring this country into line with its international treaty obligations. "My preliminary intimations from government people is that CRIA’s campaign of hysteria may be somewhat attenuated right now because there’s no particular urgency. If and when any of these cases proceed far enough, we may get some further legal clarification of the current law. What we know about the law right now is that downloading in Canada for private copying purposes on an audio recording medium is legal. That still stands. File-sharing, uploading – that’s still unclear." Many observers of the von Finckenstein ruling last year denying CRIA access to the ISPs’ records noted that the judge’s ruling seemed to move copyright law forward with a determination that saving music tracks in an accessible place to other file-sharers was analogous to setting up a photocopier in a public place – something the Supreme Court of Canada deemed non-infringing in its high profile CCH decision (CNM, March 17/04). In this ruling, the Federal Court of Appeal found that von Finckenstein had ruled on matters on which he didn’t need to rule in determining whether or not to force ISPs to give CRIA the information it was seeking. Says Lawson: "What that means is that it’s still unclear. I think it’s clear that downloading is legal. Downloading onto an audio recording medium for private use is legal, because the Copyright Board (of Canada) has made a pronouncement on that, but otherwise the whole issue of under what circumstances or to what extent file sharing itself is legal or illegal in Canada remains a grey area. That’s why CRIA is still proceeding with its lobbying efforts on Parliament Hill. I think the court was doing what most people expected the trial division to do, which was say, ‘look, we’re not in a position to look at copyright law issues, this is just really about balancing the privacy of individual Internet users with the desire of a plaintiff to sue under whatever civil regime. And, that’s all we’re going to look at.’ I think we’ve just kind of gone back to what most people expected the trial division judgment to look like." The status quo could be changed if and when the Supreme Court hears an appeal of the Federal Court of Appeal’s decision in the related private copying dispute (CNM, Dec. 17/04). In that decision, the court found that the private copying levy is not applicable on devices such as iPods, which could mean that downloading to MP3 players and personal computers is not legal. The Supreme Court is expected to rule on whether it will hear that appeal sometime this summer. Asked whether CRIA will back off in its hard lobbying on Parliament Hill for a right of making available as part of a host of copyright reforms, Henderson says that’s unlikely. "That’s a train that’s left the station."

Recording industry sees victory in ruling, will pursue suits despite loss

News | 05/30/2005 4:00 am EDT

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