Canadian Telcos Want To Play Police In War On Piracy

[grimm]

Canadian telecom giants Bell, Rogers and Videotron have escalated their copyright fight against the sale and distribution of Android set-top boxes and websites that facilitate distribution of addons for Kodi software. Kodi boxes — Android set-top boxes pre-loaded with the open source Kodi media player software — have become increasingly popular in recent years. The set-top boxes turn standard televisions into "smart TVs," enabling users to access their own content and a wide range of video content found online.

By all accounts, this includes authorized content such as YouTube, Netflix or other online video providers, as well as unauthorized streaming services that offer access to unlicensed content. The set-top box providers do not make the content available themselves, but rather sell a device preloaded with software that can be used to access both infringing and non-infringing content. In the case of "addon" sites, the sites point to addons or plugins that can be added to the Kodi media player software to make it easier to access online content.

Bell, Videotron and Rogers became increasingly concerned with the technology last year, claiming that the pre-loaded software on set-top boxes makes it easy to access infringing streaming content. Although the same could be said of most personal computers, they argued that the set-top boxes increase the likelihood of consumers cancelling their cable or satellite service and infringing their copyrights. Given their concerns, the companies asked the federal court to issue an injunction banning several companies from distributing any set-top boxes with pre-loaded software, characterizing the technology as an "existential" threat to their business models. The federal court issued the injunction, ruling that the companies met the legal standard of demonstrating "irreparable harm."
 

 

The judge's findings indicate that the telcos went far beyond acceptable conduct in their efforts to shut down the site.

More recently, the companies used the same strategy to target TVAddons, a Canadian-controlled website. The site contains information on Kodi software as well as addons that can be added to the media player. The case has attracted mounting attention due both to the manner in which the telcos used a civil search warrant (known as an Anton Piller order) to access the home of Adam Lackman, a Montreal man who owns the site, as well as the copyright issues in the case. Their actions are documented by TorrentFreak, the CBC and the National Post, which chronicle abusive conduct that included hours of interrogations without the ability to consult a lawyer along with efforts to obtain new evidence (as opposed to preserving existing evidence).

Several weeks after the search, a federal court judge vacated an earlier injunction and ordered the materials seized during the search returned (that order was later stayed by an appellate court). The judge's findings indicate that the telcos went far beyond acceptable conduct in their efforts to shut down the site:

"It is important to note that the Defendant was not permitted to refuse to answer questions under fear of contempt proceedings, and his counsel was not permitted to clarify the answers to questions. I conclude unhesitatingly that the Defendant was subjected to an examination for discovery without any of the protections normally afforded to litigants in such circumstances."

Further:

"I find the most egregious part of the questioning to be in the independent solicitor's affidavit, wherein he deposes that counsel for the Plaintiffs 'provided Defendant Lackman with some names' of other people who might be operating similar websites. It appears the Defendant was required to associate that list of 30 names with names, addresses and other data about individuals that might have some knowledge or relationship to those names. The list and the responses of the Defendant are found on three complete pages in the exhibits of the independent solicitor's affidavit. I conclude that those questions, posed by Plaintiff's counsel, were solely in furtherance of their investigation and constituted a hunt for further evidence, as opposed to the preservation of then existing evidence."

The judge then concludes that the Anton Piller order was purposely designed by counsel:

"To completely shut down the Defendant's operation. To the Plaintiffs, it mattered not that, by their own estimate, just over 1% of the Add-ons developed by the Defendant were allegedly used to infringe copyright. I therefore conclude that the purpose of the Anton Piller Order under review was only partly designed to preserve evidence that might be destroyed or that could disappear. I am of the view that its true purpose was to destroy the livelihood of the Defendant, deny him the financial resources to finance a defence to the claim made against him, and to provide an opportunity for discovery of the Defendant in circumstances where none of the procedural safeguards of our civil justice system could be engaged. [emphasis added]"

The federal court findings are incredibly damning, suggesting abusive conduct by representatives for Bell, Rogers and Videotron.

The copyright questions in the case are still to be determined, but as the federal court judge acknowledged, there are legal arguments on both sides. Canada has some of the world's toughest anti-piracy legislation, including an "enabler" provision established in 2012 that makes it easier to target sites whose primary purpose is to enable infringement. The provision states:

It is an infringement of copyright for a person, by means of the Internet or another digital network, to provide a service primarily for the purpose of enabling acts of copyright infringement if an actual infringement of copyright occurs by means of the Internet or another digital network as a result of the use of that service.

The factors to be considered include:

(a) whether the person expressly or implicitly marketed or promoted the service as one that could be used to enable acts of copyright infringement;

(b) whether the person had knowledge that the service was used to enable a significant number of acts of copyright infringement;

(c) whether the service has significant uses other than to enable acts of copyright infringement;

(d) the person's ability, as part of providing the service, to limit acts of copyright infringement, and any action taken by the person to do so;

(e) any benefits the person received as a result of enabling the acts of copyright infringement; and

(f) the economic viability of the provision of the service if it were not used to enable acts of copyright infringement.

In the TVAddons case, evidence will be needed to determine whether the enabler provision applies. The federal court judge already took note that the vast majority of the addons on the site are unrelated to infringing content. In fact, of the 1,500 addons, only 22 — or roughly one per cent — were identified as infringing addons. Lackman's lawyers argue that the site is akin to a search engine, functioning as intermediary to assist in locating content, but not playing a role in communicating it in violation of the Copyright Act.

Rights holders have powerful tools to stop infringing activity in Canada, but courts should be cautious about shutting down disruptive technologies that have substantial non-infringing uses. These battles have gone on for decades, dating back to the Sony Betamax and Diamond Rio MP3 player, with established companies seeking to stop new technologies from gaining consumer acceptance. Android boxes, Kodi software and the thousands of addons can be used in many legitimate ways to provide consumers with alternatives to restrictive set-top boxes provided by cable and satellite companies.

In this case, there are challenging legal questions that deserve a full hearing with evidence at trial (Lackman is currently crowdsourcing support for his defence). What seems clear from the federal court judge, however, is that Bell, Rogers and Videotron hoped to circumvent a trial altogether, obtaining an order designed to shut down the site without the opportunity to apply any of the legal safeguards to which everyone is entitled.