Few Copyright Board of Canada decisions have elicited as much anger from the music industry as the 2014 Tariff 8 decision. The decision relied on commercial radio rates as the barometer, which seemed appropriate given the similarities between Internet streaming services that do not allow users to select specific songs and commercial radio stations that play a regular music rotation. Music Canada and its allies disagreed, launching a major campaign against the decision, which it said resulted in 10 percent of nothing. The industry was particularly upset that the rates were lower than the U.S. (due to international copyright obligations, the Canadian repertoire during the period of the tariff was about the half as large as the U.S. one). The industry appealed the decision with considerable fanfare, promoting the many groups that joined in the action.
Archive for June, 2017
Federal Court of Appeal Deals Music Labels Major Defeat By Upholding Tariff 8 Internet Streaming Decision
The release of the Supreme Court of Canada’s Google v. Equustek decision attracted global attention with many rightly focused on the implications of global takedown orders for freedom of speech online (my post on the case here, Daphne Keller, EFF, Howard Knopf, Techdirt). The decision raises serious concerns as it invites courts around the world to issue global takedown orders that will likely lead to increased incidents of legal conflicts. That could vest enormous power in the hands of intermediaries such as Google, which will either remove links to content that is lawful in some countries or pick and choose among the orders they are willing to follow.
Global Internet Takedown Orders Come to Canada: Supreme Court Upholds International Removal of Google Search Results
The Supreme Court of Canada released its much-anticipated Google v. Equustek decision today, upholding the validity of an injunction requiring Google to remove search results on an international basis. The 7-2 decision (Justices Côté and Rowe dissented, finding that there were alternatives available, the order is ineffective, and expressing concern that the “temporary” injunction was effectively permanent) is not a surprise – last week’s Facebook’s decision suggested a willingness to side with the weaker Canadian litigant against Internet giants – but the decision will ultimately grant Google more power, not less.
Google will obviously abide the ruling, but as I noted last year, what happens if a Chinese court orders it to remove Taiwanese sites from the index? Or if an Iranian court orders it to remove gay and lesbian sites from the index? Since local content laws differ from country to country, there is a great likelihood of conflicts. That leaves two possible problematic outcomes: local courts deciding what others can access online or companies such as Google selectively deciding which rules they wish to follow. The Supreme Court of Canada did not address the broader implications of the decision, content to limit its reasoning to the need to address the harm being sustained by a Canadian company, the limited harm or burden to Google, and the ease with which potential conflicts could be addressed by adjusting the global takedown order. In doing so, it invites more global takedowns without requiring those seeking takedowns to identify potential conflicts or assess the implications in other countries.
Facebook lost a major legal showdown at the Supreme Court of Canada last week, as the court refused to enforce a forum selection clause included in its standard online contract requiring that legal actions against it be brought in California. In doing so, the court paved the way for a privacy class action lawsuit to proceed in British Columbia under provincial privacy law.
My Globe and Mail op-ed notes that a majority of the court ruled that the unequal bargaining power between consumers and companies such as Facebook meant that the clause should not be enforced. While the ruling can be narrowly interpreted as an affirmation of the importance of privacy rights and as a rebuke to companies that seek to contract out of those rights through forum selection clauses, the decision could have a far more reaching effect, forcing a re-examination of non-negotiated online contracts.
The Supreme Court of Canada issued a landmark decision this morning on the enforceability of forum selection clauses in online contracts, rejecting Facebook’s effort to block a privacy class action lawsuit in British Columbia on the grounds that its own contract specified that legal actions be brought in California. A divided court ruled that the unequal bargaining power between consumers and companies such as Facebook – combined with the importance of privacy rights – meant that the clause should not be enforced and that the lawsuit should proceed in Canada.
The decision represents a clear recognition that courts should not be quick to allow companies to contract out of important rights by ousting local laws through forum selection clauses. More broadly, the terms found within non-negotiated take-it-or-leave it clickwrap contracts should not always be enforced by the courts, particularly where important rights or remedies might be lost by doing so. While forum selection clauses are an obvious mechanism for restricting rights, the reasoning might also be applied to other online contractual terms that seek to override important laws and protections. These could include contractual terms that seek to override copyright user rights such as fair dealing or local consumer safeguards.