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The internet is like the wild west of the modern age. The simile may be trite, but there is no denying that the internet continues to progress faster than the law can regulate, rapidly presenting novel challenges for the courts. In particular, since the appearance of controversial sites such as Napster in the late 1990s, legislatures and courts have struggled to manage the illegal downloading of copyrighted material. In Rogers Communications Inc v Voltage Pictures, 2018 SCC 38 [Rogers], the Supreme Court of Canada (“SCC”) weighed in on the problem of how to adequately address illegal downloading, turning to statutory interpretation to clarify the new notice and notice regime of the Copyright Act, RSC 1985 c C-42 [CA] and the process of identifying a user’s personal identity.
Notice and Notice Regime
The CA was enacted in 1985 when the idea of sharing movies instantly over a digital network was the stuff of science fiction. With the growth of the internet, the CA quickly became outdated and ill-equipped to deal with the prolific amount of copyrighted digital material freely available online through peer-to-peer (“PTP”) file sharing. In 2015, Parliament took a step towards modernizing the CA by enacting the “notice and notice” regime contained in ss 41.25 and 41.26. Under this regime, the copyright owner notifies the Internet Service Provider (“ISP”) claiming that someone using a certain Internet Protocol (“IP”) address has infringed their copyright. The ISP must then forward that notice electronically to the person assigned the IP address and inform the copyright owner of the forwarding.
The notice and notice regime is meant to deter continued copyright infringement, but it also seeks to balance the copyright owner’s interest with internet users’ privacy rights. To that end, the CA does not require ISPs to provide copyright owners with the alleged infringer’s personal information. If the copyright owner wants the alleged infringer’s personal information in order to take further legal action, the owner must obtain a Norwich order compelling the ISP to disclose it.
The Norwich order, as with many common law mechanisms, originates with Lord Denning and the House of Lords in Norwich Pharmacal Co. v Customs and Excise Commissioners,  AC 133 [Norwich]. In that case, Norwich Pharmacal, a pharmaceutical company and owner of a patent for a chemical compound, alleged infringement of the patent and sought the name and addresses of the illicit importers of the compound from the Customs and Excise Commissioners, who claimed privilege against production of the information. Lord Denning found that a person or entity who becomes involved in the tortious act of others, such as infringing a pharmaceutical patent, is not personally liable, but he or she is under a duty to assist the injured party through discovery and disclosure of the identity of the wrongdoers.
Today, a Norwich order is a type of pre-trial discovery that compels an innocent but involved third party to disclose information to a rights holder. Alberta (Treasury Branches) v Leahy, 2000 ABQB 575, set out a number of factors to be considered for a Norwich order, one of which is the requirement that the party from whom discovery is sought must be reasonably compensated for the expenses incurred in complying with the discovery order.
Voltage, the respondents in Rogers, is a group of film production companies who alleged that thousands of Rogers customers shared their films using PTP networks. Voltage sued one unidentified customer, “John Doe,” for copyright infringement, claiming he downloaded and uploaded several of their films. As part of its action against John Doe, Voltage brought a motion for a Norwich order to compel Rogers to disclose John Doe’s personal information. Compliance with the order was not at issue, but Voltage sought that the disclosure be made without fees payable to Rogers, on the grounds that the CA does not allow a person to charge a fee for performing obligations under the notice and notice regime (s 41.26(2)). The main issue that the SCC was called to answer in Rogers was how the legislative regime of notice and notice in the CA overlaps with the common law Norwich order, which does allow a third party to charge a fee for compliance.
Justice Boswell of the Federal Court (“FC”) granted Voltage’s motion for a Norwich order, but in consideration of the privacy interests at stake, ordered only the disclosure of John Doe’s name and address as recorded in Rogers’ records. Justice Boswell agreed with Voltage that Rogers was precluded from charging a fee for fulfilling its statutory obligations. However, since the actual disclosure is not governed by the CA but rather by a Norwich order, which does specify fees, the FC ordered Voltage to pay compliance costs, which Rogers claimed as an hourly fee of $100, prior to the disclosure of John Doe’s information.
Voltage appealed the FC’s decision, which the Federal Court of Appeal (“FCA”) allowed, agreeing with Voltage that Rogers cannot charge fees for compliance with the notice and notice regime. The FCA found that an ISP must obtain a Norwich order for disclosure, for which the ISP can charge a reasonable fee for necessary costs. However, the FCA interpreted the purpose of the notice and notice regime as the protection and vindication of the rights of copyright holders, and to that end the statutory requirements are meant to reduce the complications that arise when a Norwich order is sought. With this purpose in mind, the FCA found that the CA requires an ISP, once it receives notice, to retain all the personal information that could be required under a Norwich order without charge. Consequently, if and when a Norwich order is obtained, according to the FCA, the ISP must simply deliver the information electronically to the copyright holder, the costs for which would be negligible. The FCA concluded that Rogers “could not charge for work it was already required to perform under the notice and notice regime” (para 17).
The SCC Decision
Rogers appealed, and the SCC was tasked with determining whether disclosure obligations under a Norwich order are fulfilled by complying with the CA notice and notice requirements, thereby negating the Norwich costs of compliance. To do so, the SCC turned to the overarching principle of statutory interpretation, namely that Parliament’s intent should be discerned by “examining, in this case, the words of ss. 41.25 and 41.26 in their entire context and in their grammatical and ordinary sense, in harmony with the Act’s scheme and objects” (para 20).
Examining the statutory regime’s preamble, as well as extrinsic evidence from the consultation process leading to the CA’s modernization, the SCC agreed with the FCA that one of the regime’s goals is to deter continued copyright infringement by IP users who receive notice. However, the SCC found that notice and notice is “not intended to embody a comprehensive framework by which instances of online copyright infringement could be eliminated altogether” (para 24). Rather, the notice and notice regime is the first step in a process of addressing an infringement. If after sending notice a copyright holder decides to take an alleged infringer to court, a Norwich order is necessary for the copyright holder to identify the wrongdoer in order to take further legal steps.
Unlike the FCA, the SCC found that the purpose of the statutory regime was not only to protect the interests of copyright holders, but rather to “balance the interests of all stakeholders” involved in the digital media-sharing process (para 25). In finding this second purpose, the SCC compared the notice and notice regime to the “notice and takedown” regime prescribed in the United States, which requires an ISP, upon receiving notice of copyright infringement, to remove or block access to the infringed material. The SCC reasoned that because Parliament did not enact a regime more favourable to the copyright holder’s interests, such as “notice and take down,” the purpose of the notice and notice regime is to account for the interests of all parties involved.
In order to establish the relationship between CA and Norwich obligations regarding information collection, the SCC then analyzed the “grammatical and ordinary sense” of the provision, focusing on the requirement that an ISP “retain records” that “will allow the identity of the person to whom the electronic location belongs to be determined” (para 39, emphasis in original). According to the SCC, these provisions make clear that under the CA an ISP does not have determine a person’s specific identity, but simply to retain records that will facilitate determination if disclosure is ordered.
Furthermore, the SCC found that requiring an ISP to determine the personal identity of every person to whom it must forward notice would undermine the statutory regime’s purpose of balancing all stakeholders’ interests. For example, because Rogers receives up to 300,000 notices of alleged copyright infringement every month, it is unlikely that the CA would require Rogers “to undertake identification work in all cases even though the vast majority of notices sent will never culminate in a Norwich order” (para 40).
The CA also implicates important privacy interests for IP holders, especially because an IP address is not determinative of an assigned individual’s actual internet use—many people may use the same IP address, and internet security can be an issue. The SCC made clear that being associated with an IP address to which an ISP has forwarded notice of copyright infringement is not determinative of guilt, and found that
Requiring an ISP to identify by name and physical address the person to whom the pertinent IP address belonged would, therefore, not only alter the balance which Parliament struck in legislating the notice and notice regime, but do so to the detriment of the privacy interests of persons, including innocent persons, receiving notice” (para 41).
Ultimately, the SCC found that the notice and notice regime may require an ISP to retain records to facilitate identification of an IP holder if compelled to do so by a Norwich order, but an ISP does not need to undertake the identification work until such an order is granted. Though the notice and notice regime and a Norwich order complement each other, their requirements are not the same. All levels of courts agree that no costs are payable to an ISP for fulfilling its statutory obligations, but as the SCC held, those obligations only require the ISP to keep a record that will allow determination of identify in the future if necessary. Though some of the determination process may have been fulfilled according to the statutory obligations, the identification required under a Norwich order will likely require additional work, for which an ISP can recover reasonable costs for the difference.
Though the motion judge accepted Rogers’ hourly rate of $100, stating “it is what it is,” the SCC found that he erred by failing to consider how much of the identification process performed under the statutory requirements overlapped the Norwich requirements. The SCC allowed Rogers’ appeal, finding that the ISP was entitled to reasonable costs of compliance with the Norwich order, but remitted the quantum of the entitlement back to the motion judge to determine the reasonable amount in accordance with the SCC’s findings.
As Justice Brown writes in the opening line of the SCC decision, “online infringement of copyright has become commonplace” (para 1). The hundreds of thousands of notices sent to Rogers monthly are proof of its ubiquity, though that number is likely only a small fraction of the total infringements taking place online. In the face of such prolific infringement activity, legislation hardly seems up to the task of stopping the practice. Even under stricter regimes such as the US “notice and take down” scheme, legislation acts as little more than game of whack-a-mole—when one file-sharing site is taken down, another pops up in its place. When the law is incapable of stemming the tide of online copyright infringement, perhaps Parliament and the SCC have taken the best course by enacting and interpreting a statutory regime that, while not eliminating the problem, at least balances the interests of all parties involved.