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Misleading on Fair Dealing, Part 10: Rejecting Access Copyright’s Demand to Force Its Licence on Canadian Education

My series on misleading on fair dealing concludes today with a post on Access Copyright’s demands for copyright reform. The copyright collective’s strategy is simply to force educational institutions to pay for its licence. It seeks to do so through two legal reforms: (i) restrict the use of fair dealing for education and (ii) massively increase the risk of liability through the imposition of statutory damages. The proposed reforms run directly counter to Canada’s longstanding commitment to balanced copyright, would reduce choice and innovation in licensing content online, and leave students and taxpayers facing risks of multi-million dollar liability that far exceeds the value of any copying.

This ten part series has addressed many of the misleading claims that have surfaced in recent months about fair dealing and copying practices in Canada:

  • Noting that claims that the 2012 reforms are to “blame” for educational copying are directly contradicted by Access Copyright’s own statements to the Copyright Board of Canada (when asked last week about the issue before the Heritage committee, Access Copyright switched the subject).
  • Unpacking the attention-grabbing claim that there are 600 million uncompensated copies annually, demonstrating that the number is the result of outdated guesswork using decades-old data and deeply suspect assumptions.
  • Conclusively showing how the market for educational copying has changed in recent years as education shifts from the print-based Access Copyright photocopy model toward the abandonment of print coursepacks, reduced usage of books within course materials, and the massive investment in site licensing
  • Explaining why site licences offer far better value than the Access Copyright licence, particularly given the ability to pay for both access and reproduction in a single licence, whereas Access Copyright only provides rights of reproduction for materials that have already been acquired.
  • Discussing how Access Copyright has steadfastly opposed transactional licensing, despite a ready market and multi-million dollar spending every year by educational institutions.
  • Highlighting the emergence of free and open alternatives that now constitute a quarter or more of course materials, including public domain works, open educational resources, open access, and hyperlinking to third party content.

Faced with this reality – a competitive, innovative market for licensing that offers more choice to educational institutions grappling with limited funding and demands for digital access – Access Copyright’s proposed response is legal reform designed to force educational institutions to pay for its photocopy licence. Everyone agrees that education has increased spending on licensing since 2012. However, since institutions are not spending it on this particular licence, the copyright collective demands two legal reforms to force them to do so.

First, Access Copyright wants to eliminate fair dealing for education where its licence is available. From its brief to the Industry committee:

Access Copyright submits that the Copyright Act be amended such that the fair dealing exception for the purposes of research, private study and education not apply to educational institutions in respect of works that are commercially available. Such amendment would stipulate that a work is “commercially available” if it is available to the user from a collective society or by the rightsholder within a reasonable time and for a reasonable price and may be located with reasonable effort.

It is difficult to conceive of a more anti-innovation, anti-education proposal. While Canada’s trading partners are debating how to support innovation and education through expanding the purposes of fair dealing or adopting fair use, Access Copyright’s proposal would create one of the most restrictive systems in the world. Indeed, some of the most innovative countries, including the United States, Singapore, South Korea, and Israel, have all adopted full fair use provisions. Others, including Australia and South Africa, are considering a fair use provision. Yet despite the moves elsewhere toward fair use, Access Copyright proposes a reform that would greatly restrict user rights, increase litigation and educational costs, decrease competition, and create disincentives for investment in new access to materials. The proposal should be rejected.

Second, Access Copyright wants statutory damages of up to ten times applicable royalties added to the Copyright Act. The copyright collective argues that the massive escalation in potential damage awards are needed for three reasons: deterrence, promotion of settlement negotiations, and efficient use of court resources. Yet none of the arguments ring true. Deterrence is used in the context of small establishments that might use music without paying the appropriate licence. But that is far different from the current situation with educational institutions that have not paid the Access Copyright licence because of a good faith analysis of the scope of fair dealing under Canadian copyright law coupled with huge investments in alternative licensing. For Access Copyright to argue that non-payment of its licence is a function of low risk of penalties rather than a different view of copyright law and the market badly (and knowingly) mischaracterizes the situation.

Further, the so-called public policy benefit of promoting settlement negotiations amounts to little more than the hope that increasing liability risk will convince educational institutions – and by extension students and taxpayers – to cave to Access Copyright’s shaky legal claims. The litigation costs sparked by the Access Copyright lawsuit are significant. To accept Access Copyright’s argument, it would be beneficial to encourage the collective to file lawsuits against educational institutions with the added threat that failure to settle could lead to hundreds of millions in liability beyond what even Access Copyright would argue are the applicable royalties.

The reality is that Canadian copyright law features two different approaches to the use of tariffs determined by the Copyright Board. Some tariffs, such as those for music collective SOCAN, are mandatory owing to concerns over competitive practices. This means the collective must file tariffs with the board, which determines the appropriate rate. Since the filing with the board is mandatory, the law provides for the possibility of a statutory damages multiplier, meaning that users that fail to pay the prevailing tariff may owe several times more than the actual licence fee.  This helps foster compliance, sets a cap on statutory damages, and represents a quid pro quo for the mandated filing approach.

Alternatively, for some tariffs, such as those involving Access Copyright, the use of the board is optional. This leaves it to rights holders to determine if they want to privately negotiate their rates or have the board establish a rate for the market. Since the process is optional, there are no statutory damages multipliers in effect. Statutory damages are rarely used around the world and should be rejected as a reform as part of this review process.

The educational copying debate is painted by Access Copyright and its supporters as a matter of refusal to pay for use. Yet the evidence tells a far different story, demonstrating increased spending and misleading claims about copying. The reality is that the issue was never about whether education pays for materials. It clearly does, now more than ever. Rather, it is about whether education gets to choose which licences best meet its needs and whether the market will continue to innovate to provide creators and publishers with more options for how their works can be licensed.

4 Comments

  1. As I’ve been reading the series, I’ve been frequently wondering if one could do a simple infographic in one of two forms:

    a. From the perspective of an educational institution (more of a before and after pic) to show what piece of the pie AC is trying to grab; and/or,

    b. From the perspective of a writer/creator of the original content and how they can get / are paid.

    It seems like both would show shifting pathways, and NONE of the numbers that AC is trying to push. Either would seem like semi-powerful submissions to the Board.

  2. Hi.
    The story was very functional
    thank you

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