Supreme Court of Canada Chamber by Sean_Marshall (CC BY-NC 2.0)

Supreme Court of Canada Chamber by Sean_Marshall (CC BY-NC 2.0)


Notice the Difference?: Supreme Court Rules ISPs Can Be Compensated for Copyright Costs

Policy makers have long struggled to strike a fair balance in crafting rules to address allegations of copyright infringement on the Internet. Copyright owners want to stop infringement and the right to pursue damages, Internet subscribers want their privacy and freedom of expression rights preserved in the face of unproven allegations, and Internet providers want to maintain their neutrality by resolving the disputes expeditiously and inexpensively.

My Globe and Mail op-ed notes that the Canadian system for online infringement was formally established in 2012 and came into effect in 2015. The so-called “notice-and-notice” approach grants rights holders the ability to send notifications of alleged infringement to Internet providers, who are required by law to forward the notices to the relevant subscriber and to preserve the data in the event of future legal action. The system does not prevent rights holders from pursuing additional legal remedies, but Internet providers cannot reveal the identity of their subscribers without a court order.

While the system has proven helpful in educating users on the boundaries of copyright, some rights holders have used it as a launching pad for further lawsuits. In fact, thousands of lawsuits have now been filed, with rights holders seeking to piggyback on the notice-and-notice system by obtaining the necessary subscriber information directly from Internet providers at no further cost.

The question of costs lies at the heart of an important Supreme Court of Canada copyright ruling released on Friday. Voltage Pictures sought subscriber information from Rogers Communications for the purposes of pursuing individual lawsuits. When Rogers advised that it wanted compensation of $100 per hour for the costs associated with fulfilling the request, Voltage responded that Internet providers could not pass along their costs since the notice-and-notice system already required them to identify subscribers and preserve the data without compensation.

The particular incident may have involved only a few hundred dollars, but the broader principle had the potential to dramatically alter the Canadian approach. If Internet providers were required to disclose subscriber information without passing along the costs, Canadian courts faced the prospect of an avalanche of lawsuits and Internet providers might be dissuaded from carefully ensuring that the privacy of their subscribers was properly protected.

The Supreme Court understood the broader implications of the case, ruling that Internet providers can pass along the specific costs associated with subscriber disclosures beyond those required for the notice-and-notice system. Indeed, the court recognized the importance of accurate data to safeguard against reputational harm and wrongful lawsuits.

While the ruling rightly restores the notice system back to its intended approach, there is still more work to be done to ensure that the balance the government sought to achieve between rights holders, subscribers, and Internet providers is maintained.

First, the Canadian approach recognizes that with great rights come great responsibilities for Internet providers. For these guardians of highly sensitive personal information, including the browsing habits, social contacts, and location data for millions of Canadians, disclosing subscriber information as part of a litigation process raises significant privacy issues.

The courts have determined that there may be situations where disclosure is appropriate, but doing so requires ensuring that the data is accurate and only revealed for specific, limited purposes. Friday’s ruling reinforces that Internet providers will be compensated for the costs associated with meeting those obligations. It now falls to them to ensure they exercise care and caution for any subscriber disclosures.

Second, the government must ensure that the notice-and-notice remains in place, despite considerable pressure from the United States to change it as part of the NAFTA renegotiations. The U.S. would like Canada to adopt its notice-and-takedown system, which encourages the removal of content online without a court review or order. But that approach that raises freedom of expression risks since it may raise instances of removing lawful content. The U.S. previously acknowledged during the Trans Pacific Partnership negotiations that the Canadian system provided an equivalent deterrent against online infringement. Despite renewed U.S. trade pressures, undoing the Canadian copyright balance should be taken off the table.

Third, assuming that notice-and-notice survives the NAFTA renegotiation, Innovation, Science and Economic Development Minister Navdeep Bains should follow through with a prior commitment to fix the loopholes in the Canadian approach. The system was designed to educate Canadians and avoid expensive litigation, but in the Rogers case, hundreds of thousands of notices that include settlement demands, and a steady stream of class action claims filed against individuals suggest that the system needs tinkering.

The government previously indicated that long-overdue changes prohibiting the inclusion of settlement demands in notices would be forthcoming. Now that the Supreme Court has settled the question of costs, it falls to the government to complete the job of addressing the shortcomings of a system designed to fairly balance the rights of all stakeholders.


  1. Kelly Manning says:

    Most people don’t have the funds or technical sophistication to prove that they were not using the IP addresses mentioned in the notice at the time of the alleged infringement, but some have been able to establish that the claims are false.

    One of the lawyers recruited into the Voltage Boilerplate Copyright Trolling operation is now suing Voltage.

    “Defendants have been unjustly enriched as a result of Davis rendering services in cases that lacked a valid legal or factual basis and were therefore impossible for Davis to successfully litigate.”

  2. Thank you, particularly for your second point.
    It seems to me that the difference between instituting a takedown regime vs. leaving the Internet alone, is somehow being lost in NAFTA talk of milk and cars.
    There are so many more dangerous obstacles down the terrain of this slope than some overzealous takedowns errors; this is a channel for state censorship.
    Takedowns are a threat to democracy, and they should really be a deal breaker.
    We must guard, not just against our government, but a future corrupt one, too.
    Thanks again,

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  5. Pingback: Canadian Supreme Court: ISPs Can Be Compensated for Notices -

  6. Doesn’t this just incentivize the Canadian ISPs to give away user information? Surely there are thousands of bogus claims filed against people everyday, but now the ISP can claim costs associated with giving away their data.

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