Federal Court rules Rogers entitled to $35 per hour for subscriber disclosure

The Federal Court is setting at $35 the hourly rate that Rogers Communications Inc. can charge rightsholders for the work it takes to identify and disclose the personal information of alleged copyright infringers. That is $65 less than what Rogers originally requested two years ago -- when a Federal Court judge ruled that it could charge $100 per hour -- but $35 more than when a Federal Court of Appeal judge overturned that decision and said Rogers can’t charge unless the government sets a fee ceiling. The Supreme Court of Canada finally ruled that the telecom can charge, and it was up to the Federal Court to decide how much. While Tuesday’s decision doesn’t determine a uniform and blanket cost that all ISPs can charge, it establishes the methodology used by the court to determine those costs, according to Fasken Martineau DuMoulin lawyer Jay Kerr-Wilson, who represents TekSavvy Solutions Inc. on notice-and-notice litigation. The judgment adds a definitive amount Rogers can charge for the extra work the company said it must do to verify the identity of an alleged copyright-infringing subscriber before it hands over the information to the rightsholder -- in this case, Voltage Pictures LLC. In a decision in September, the Supreme Court delineated between the work that must be done for free, as is obligated under the law, and those crucial extra steps the ISP takes to ensure accuracy -- for which it can charge a fee. The court effectively narrowed the costs ISPs can recover to exclusively those that went into procuring the information that the court order requires. Judge Keith Boswell focused on the affidavit of a Rogers employee in the company’s lawful access response group. Andrew Yoo submitted evidence claiming his group’s costs were $71.10 per hour per employee, but that included overhead that the affiant admitted did not factor into the fulfillment of the court order on Rogers. The company said additional fees came from employee benefits. The court stripped out those costs and, after the rightsholder Voltage admitted that $35 was a reasonable fee, Boswell settled on allowing Rogers to bill solely for the labour hours specific to the work required. Because this particular case involves five IP addresses up for disclosure, the court on Tuesday found that the time it took Rogers to review the order, log the request, link the modem and the customer name, and compile the names in a spreadsheet meant the company was entitled to $67.23. But it found that it took Rogers an average of 24 minutes to look up the customer name and address for an IP address with two timestamps. The decision, thus, “provides a useful roadmap for parties to follow in similar proceedings and should reduce the need to refer these questions to the Court for resolution,” Kerr-Wilson said. Rogers spokesman Bill Killorn said in an emailed statement that “we continue to review this decision, but are pleased the Court has recognized that Rogers should be compensated for its reasonable costs in conducting IP address look-ups.” Because the decision is determined on a case-by-case basis, it does not spell out what exactly other telecoms can and will charge. Kerr-Wilson said he doesn’t see the $35 as a benchmark because the amount was derived specifically from Rogers’ particular evidence, adding “each case will be decided on its own facts and we should expect to see different amounts for each ISP.” In his decision Boswell cited references to how much time ISPs spend and how much they charge for disclosure to come to a “reasonable cost” figure for Rogers. Per IP address, according to the court record, BCE Inc. spends between 20 and 45 minutes and charges $50 per IP address; Sasktel spends two hours and charges $50 per hour; Telus Corp. spends 30 minutes at $100 per hour; and Shaw Communications Inc. uses between 30 minutes and several hours at a rate of $250 per hour. Whether cost cases end up in court will be up to the parties and whether they can come to an agreement on disclosure fees, Kerr-Wilson noted. Howard Knopf, an intellectual property lawyer, wrote about the case in a blog post. He said if the $35 is used hypothetically as a benchmark for a yet-uncertified reverse class action, which includes 55,000 potential alleged infringers that Voltage hopes to sue, then the costs to disclose all those names would potentially cost Voltage $870,100 after tax. The math is pegged on the 24-minute average, divided by 60 minutes, multiplied by the new hourly rate of $35 and times the number of defendants. Kerr-Wilson said he doesn’t see the decision as a deterrent to rights owners seeking to have that information disclosed, factoring in costs of litigation and the availability of statutory damages, which is a maximum of $5,000 for non-commercial infringement and $20,000 for commercial infringement. Still, what this case means for similar future disclosure orders and their costs is unclear. “While the decision might offer guidance to intermediaries about the reasonableness of their procedures and cost recovery policies, the reasonableness of different approaches could be considered differently,” said Jeremy de Beer, a law professor at the University of Ottawa, whose Canadian Internet Policy and Public Interest Clinic (CIPPIC) intervened in the case. — With reporting by Ahmad Hathout at ahathout@thewirereport.ca and editing by Michael Lee-Murphy at mleemurphy@thewirereport.ca

Federal Court rules Rogers entitled to $35 per hour for subscriber disclosure

Broadcast | August 8, 2019

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Federal Court rules Rogers entitled to $35 per hour for subscriber disclosure

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