Federal Court says disclosure motions need ‘best available evidence’

Key evidence relied upon by movie studios in a substantial chunk of copyright infringement cases that have yielded vast sums of money from settlements has been ruled insufficient by a Federal Court judge who reversed a disclosure order on Thursday. TekSavvy Solutions Inc. challenged the disclosure orders brought by three movie studios against 13 internet service providers in November 2017. The Chatham-based ISP said the studios provided evidence to the court that was made up of unsworn statements from a third-party, lacked relevant documents, and contained false testimony claiming that some of the alleged infringers received a first notice of allegedly infringing activity. On Friday, judge William Pentney ruled that the plaintiffs did not present the “best available evidence” in asking for a disclosure order. He said errors related to weak evidence included insufficient information and outright inaccuracies, which could have led to the disclosure of individual identities who did not receive notices as required under the law. Friday’s decision will mean plaintiffs requesting those orders will have to revisit the evidence in outstanding and future motions, according to an intellectual property lawyer. “This is a very important case,” Barry Sookman, a partner at McCarthy Tétrault LLP, said in an email. “There are hundreds of similar disclosures being sought by the same law firm that acted for ME2 Productions in this case,” and those rely on “substantially the same evidence that the court ruled to be inadmissible.” “This will mean that all those motions will have to be withdrawn or the evidence will have to be provided by appropriate witnesses, not merely law clerks with plaintiffs’ lawyers,” Sookman said, adding the result won’t “pose difficulties” for the rightsholders to get the appropriate evidence together. Late last year, two movie studios filed disclosure motions to obtain subscriber information from Rogers Communications Inc. Rogers challenged the requests because they did not include a way for the telecom to retrieve its costs after the Supreme Court of Canada ruled it could charge “reasonable” costs to procure the information. Andy Kaplan-Myrth, TekSavvy’s vice-president of regulatory affairs, said in an email that the company is pleased with the decision, as it builds on previous decisions that “copyright enforcement requires a balancing of interests” -- disclosure and privacy interests. “ISPs who receive orders for their customers, or indeed Internet subscribers who are ultimately sued for infringement, should look carefully at that evidence and question whether it was in fact sufficient in light of this decision,” Kaplan-Myrth added. Indeed, Friday’s decision piggybacked on the SCC’s ruling in September, which emphasized the primacy of accuracy. Pentney said it’s not enough that ISPs must accurately get notices to the right individuals, but rightsholders must ensure their evidence matches their disclosure requests. Pentney determined that the plaintiffs fell short of the accuracy component of the evidence they brought, finding up to four TekSavvy subscribers “had not, in fact, ever received any notice of possible copyright infringement.” The studios are represented by Ken Clark of Aird and Berlis LLP. In an email on Monday, Clark called the issue overturned by the judge as a “technical one based on the form of the evidence. “Even with that finding, we can re-file the same motion with non-hearsay evidence, so the case will continue in any event.” Last summer, The Wire Report viewed a trove of cases involving 17 movie studios that all had the same goal of obtaining the personal information of internet subscribers who they allege infringed on their copyright. In nearly all cases, the key piece of evidence for disclosure is a declaration attached as an exhibit to an affidavit sworn by law clerks employed by counsel for the studios. The declaration is made by Daniel Arheidt, a consultant in the technical department at Maverickeye, the company that scans IP addresses for infringing activity. The declaration includes information on file sharing, tables of IP addresses allegedly caught in the act, and dates and times of warning notices sent to stop the activity. The law clerks’ affidavits state that they rely on the declaration and believe it to be true, according to the decision. This evidence was left unchallenged as disclosure orders were signed off by the court over months. Those orders subsequently led to lawsuits against individuals, some of whom ended up settling for various amounts that totalled over a quarter of a million dollars since the beginning of last year. TekSavvy challenged the declaration on the grounds that it is hearsay and is not subject to cross-examination because it’s just an exhibit. The telecom said it’s therefore insufficient evidence to warrant disclosure orders. The plaintiffs -- ME2 Productions Inc., WWE Studios Finance Corp., and I.T. Productions LLC -- argued that TekSavvy doesn’t challenge the merits of the evidence, did not seek to cross-examine on any of the affidavits, and didn’t forward the notices “as soon as feasible,” the decision said. The Federal Court agreed with TekSavvy’s position on Thursday, stating that the affidavits of the law clerks don’t meet the standards of the law. It pointed to examples including a lack of explanation for why Arheidt did not swear an affidavit in the matter or why the clerks believe the declaration to be true. “It appears that the Arheidt Declaration shows that one of the IP addresses included in the materials sent to TekSavvy was actually associated with a customer of another ISP,” Pentney said in his decision, bolstering his argument about weak evidence. “It is not clear how or why this IP address was included in the motion materials associated with the order sought against TekSavvy, but it does confirm the importance of seeking the best available evidence.” The court noted that while errors can be made due to the “growing pains” with implementing the copyright regime, the parties have had years to adjust. “Materials from copyright owners seeking orders should now be organized and complete,” the decision said. “The Court, the subscribers whose privacy interest are affected by such extraordinary orders, and the ISPs to whom the order will be directed, deserve no less.” — With reporting by Ahmad Hathout at ahathout@thewirereport.ca and editing by Anja Karadeglija at akarad@thewirereport.ca

Federal Court says disclosure motions need ‘best available evidence’

Broadcast | February 22, 2019

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Federal Court says disclosure motions need ‘best available evidence’

Broadcast | February 22, 2019

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