Canadian File-Sharing Ruling

[Pete C]

Court sides with music swappers


By TERRY WEBER and JACK KAPICA
Globe and Mail Update


UPDATED AT 10:14 PM EST Wednesday, Mar. 31, 2004



The Federal Court of Canada ruled Wednesday that Internet Service Providers can't be forced to turn over identities of suspected music swappers, throwing a roadblock in the path of the recording industry's efforts to crack down on the practice.

In a 31-page decision, Judge Konrad von Finckenstein said the Canadian Recording Industry Association hasn't made its case for ordering ISPs to turn over the names of 29 suspected so-called music uploaders, people who offer music for others to download.

The industry had wanted the names so that it could launch lawsuits against individuals it claims are high-volume Internet music swappers.

As part of his ruling, the judge found that simply downloading a song or having a file available on peer-to-peer software such as Kazaa doesn't constitute copyright infringement.

"The mere fact of placing a copy on a shared directory in a computer where that copy can be accessed via a P2P service does not amount to distribution," Judge von Finckenstein said.


"Before it constitutes distribution, there must be a positive act by the owner of the shared directory, such as sending out the copies or advertising that they are available for copying."


Last month, the Canadian Recording Industry Association asked the court to order five of Canada's largest communications companies to identify 29 uploaders who they allege posted hundreds of songs illegally.

The industry charges that song swapping in cyberspace has had a dramatic impact on music sales in this country, costing as much as $425-million in lost revenue over the past five years.

But, Judge von Finckenstein denied the request noting that, while third parties have been compelled to disclose identifying documents in the past, the plaintiffs haven't shown a causal link between P2P pseudonyms and IP addresses nor have they made out a broader case of infringement.

As well, he said, they haven't established that the ISPs are the only practical source of the identity of the P2P pseudonyms, nor have they shown that the public interest for disclosure outweighs privacy concerns.

The recording industry swore to continue its fight against file sharing, and is considering an appeal of the decision.

CRIA president Brian Robertson stood fast in his interpretation of the law, insisting that despite the judgment, sharing music files is still against the law.

"We remain committed to our plans to enforce the law against unlawful 'file sharing,' which is devastating the entire music community," he said in a statement after the ruling."

"We continue to believe it's unlawful under Canadian law to share files on peer-to-peer networks," CRIA general counsel Richard Pfohl said.

"I expect we will be appealing on the basis of technology," he continued. "We don't believe that when someone puts thousands of files into a shared folder to be traded on the Internet, it's an act of private copying."

"We presented more initial evidence than has ever been put forward in a request for disclosure of user identities from ISPs — which Canadian courts have granted on numerous occasions," he said.

Judge von Finckenstein is regarded as a senior judge with an extensive understanding of technology and is an expert in international commerce. Most recently he was the federal competition commissioner.

In the United States, legal action has been taken by the music industry against song swappers.

But in decision in December, a U.S. Appeals Court ruled that service provider Verizon didn't have to turn over the names of individuals, finding that the service provider was only responsible for content kept on its own server.

[Pete C]

File-sharing ruling opens Pandora's Box

Music industry's court loss raises implications for TV programs, movies, DAVID AKIN writes



By DAVID AKIN


UPDATED AT 11:20 AM EST Friday, Apr. 2, 2004


While at the University of Waterloo, Matt Goyer and his housemates didn't want to buy premium television channels such as The Movie Network.

But to make sure they didn't miss an episode of The Sopranos or Six Feet Under, both of which air in Canada on The Movie Network, Mr. Goyer and his friends would fire up a new kind of Internet-based file trading software application called BitTorrent and download episodes that had been digitized by other fans.

"You can get a ton of content. You name any TV show," Mr. Goyer said yesterday from his office in Redmond, Wash., where he has started with Microsoft Corp. after finishing his studies at Waterloo this year.

Mr. Goyer and his friends scare companies that own the rights to television programs, films, software and books -- content that can be digitized and distributed on the Internet with ease using freely available software.

In the wake of a Federal Court of Canada ruling yesterday involving the country's biggest record companies, some rights holders are worried that they have lost the ability to protect those rights.

"It would be unfortunate if people saw this decision and suddenly decided to use file-sharing to distribute copyrighted works. That's just not the case," said Jacqueline Hushion, executive director of the Canadian Publishers Council.

Alastair Mitchell, co-chief executive officer of Moontaxi Media Inc. of Toronto called the ruling "disturbing." Moontaxi Media is the operator of Puretracks, a record industry-sanctioned on-line service where consumers can download music for 99 cents a song. "We believe emphatically that musicians should be paid."

Digital songs purchased at Puretracks contain software locks, which prevent or inhibit their widespread distribution. Movie makers, software publishers, book publishers and others who produce digital content have also been working on similar software locks.

But many in those industries worry that one day the Internet will be filled with users as sophisticated as Mr. Goyer -- and when that happens, they may lose control of the digital distribution of their content the way the Canadian Recording Industry Association (CRIA) seems to have lost control of its.

On Wednesday, Mr. Justice Konrad von Finckenstein of the Federal Court of Canada dismissed a request brought by CRIA that some of Canada's largest Internet service providers be forced to turn over confidential customer information, which CRIA believes could help it sue 29 Canadians for copyright infringement.

In what some lawyers privately said was an embarrassing loss for the record industry, Judge von Finckenstein not only denied the request but went further, ruling on a variety of issues involving copyright, on-line privacy and the liability of Internet service providers. Almost nothing in his 31-page ruling could be seen as favourable to the record industry, legal experts said.

Howard Knopf, an Ottawa lawyer who represented the Canadian Internet Policy and Public Interest Clinic, who were intervenors in the CRIA matter, said Judge von Finckenstein's ruling would apply in some ways only to music copyrights.

"But the decision also speaks more generally to the meaning of distribution and authorization in the [peer-to-peer] context," he said yesterday. "So, its possible that the decision could have implications beyond music file sharing."

The CRIA case centred around the activities of several Canadian users of KaZaa, the file-trading Internet application distributed by Sharman Networks Inc. of Sydney, Australia. KaZaa users designate special directories or folders on their computer hard drives to become public folders.

Then, other KaZaa users can browse through that folder and make digital copy of the contents of that5 folder.

Most users trade music files in this way but KaZaa and several other applications that use a similar peer-to-peer distribution model are built to enable the exchange of any kind of digital file -- be it a version of a movie, a television program, software or electronic book.

"The larger issue is how does government and the courts intend on protecting proprietary rights," said Harvey Nightingale, executive director of the Canadian Interactive Digital Software Association, which represents Canada's videogame publishers and manufacturers.

"I think the government has to." he said. "Can you imagine all the money that would be lost and possible job losses if this ruling were allowed to be carried across all [content] boundaries, to software, publishing, anything you can digitize?"

And yet, there is some evidence that music downloads may not be as harmful to the music business as record industry associations here and elsewhere suggest.

First, a study released Monday by business school professors at Harvard University and the University of North Carolina concluded that there was no correlation between on-line downloads and music sales.

Secondly, despite the popularity of file-trading applications where music can be obtained for free, business at industry-sanctioned on-line music services where users pay to download is booming.

Market researcher Ipsos-Reid said this week that traffic on fee-for-download sites in North America tripled in 2003 from 2002 with more than 10 million people reporting that they had paid to download music at least once.

In Canada, the Puretracks service notched one million downloads within six months of starting up.

"Things are cooking," Mr. Mitchell of Moontaxi said. "We're pretty happy with the way people have responded."

David Akin is a CTV correspondent and a contributing writer to The Globe and Mail.

[Pete C]

Music industry does not react with one voice


By GUY DIXON
Globe and Mail Update


POSTED AT 7:56 AM EST Friday, Apr. 2, 2004

Executives at the major record labels have always been clear on the matter: File sharing is wrong. Dead wrong. No court decision will ever likely change their minds.

But ask anyone else connected in some way with music -- from artists and small record company managers to listeners and file sharers themselves -- and you'll get myriad views on the matter, pro and con. The decision Wednesday in a Toronto Federal Court against the Canadian Recording Industry Association's attempt to sue file sharers in Canada doesn't seem to have changed opinions much.

"I think there should be a celebration. I think music lovers in Canada should immediately go to their favourite peer-to-peer software and just download something and listen to it. And have a big silly grin on their face," said David Jones, a computer science professor at McMaster University and president of Electronic Frontier Canada. The civil liberties group promotes freedom of expression on the Internet and made a formal motion in the case arguing against the recording industry's moves to stop file sharing.

Jones shares music files himself, in other words, accesses songs on his computer directly from other computer users through on-line, peer-to-peer programs such as Kazaa, while also making songs on his computer available for others to copy.

The judge ruled that CRIA didn't present sufficient evidence that these file sharers were infringing copyright law or that Internet service providers should have to release the names of users behind 29 file-sharing addresses -- presumably 29 individuals -- that the recording industry had hoped to sue in order to get them to stop. CRIA said Wednesday that it expects to appeal the decision.

"Their claim is that this case was so important.

"It's like the lifeblood of the industry, that we have to get these 29 teenagers because they are killing our industry," Jones said. "And the judge tells them, your evidence is deficient, that you have no evidence of infringement. Period. They dropped the ball."

For artists and smaller independent labels, however, the mood seemed more mixed.

"There are a lot of things involved in the decision. It's the whole battle over copyright," said Trevor Larocque, label manager for Pager Bag Records, an independent label in Toronto that continues to be a favourite among critics and hip, indie-store crowds, with bands such as Stars and controller.controller on its roster.

"I think that we are pro file sharing as a company," he said. Because most of Paper Bag's artists are new or lesser known, for a potential listener to be able to access a song or two by one of the label's acts only helps them to get noticed. The company's discs, though, are distributed by industry giant Universal Music. So Paper Bag isn't immune to the concerns of industry biggies.

Scott Kaija, guitarist with controller.controller, who also works with the music-promotion website UmbrellaMusic.com, is a little troubled by the industry's legal tactics. He feels that record companies need to "hold a mirror to themselves to answer questions about why the industry is failing. It kind of sickens me that they've turned it into a kind of lynching, like a witch-hunt for these kids who are downloading. I just don't see downloading music as the problem. It's a symptom of a larger issue."

On the West Coast, Joel Kroeker has a somewhat different take. A pop-oriented singer-songwriter from Vancouver, he is signed to independent label True North Records and feels that, in some respects, the court decision wasn't necessarily a good one.

"I think the general public is under the mistaken notion that the artists don't actually need the sales. I've heard people say it's about greed or things like this. At my level, it's definitely not. I'm struggling to pay my rent, right? So every sale is directly related to my own existence," Kroeker said.

Like many musicians, he believes the whole file-sharing debate cheapens the art. "I don't think people realize the amount of effort that goes into making an album. It's years of work. For me, I'm self-managed, so it's literally [working] 16 hours a day, 7 days a week for years at a time."

Toronto-based technology analyst Rick Broadhead, on the other hand, falls on the side of those who were outright stunned by the court decision.

"With all due respect to the judge, he doesn't seem to have a good grasp of what the Internet is and how it works," he said, describing it as a huge blow to the music industry, if not all areas in which artistic works are protected by copyright. "The very nature of these file-sharing services is that they allow distribution, worldwide distribution. To compare the Internet to a photocopy machine is ludicrous."

As part of his decision, the judge said he didn't see a real difference between a photocopier in a library and a personal computer with songs on its hard drive and linked to a peer-to-peer network.

The timing of the court decision had at least one plus for major Canadian labels. Nearly everyone who is anyone is en route to Edmonton for the Juno Awards, and they will be able to occupy their minds with parties and promotions over the next few days. On the flip side, guess what the No. 1 topic will be at those events?

[mke]

Originally Posted by The Judge

"Before it constitutes distribution, there must be a positive act by the owner of the shared directory, such as sending out the copies or advertising that they are available for copying."

That distinction doesn't make much sense to me.

[Gary Sisco]

I do. It's the difference between a library (which is nothing but a "file sharing" device, after all) and a booted book distribution operation.

[mrsqueezejr]

So, let's get this out of the way. Everyone who has money in the Jazzcorner pool as to how long it would take me post to this thread, the winning bet is 24 hours! And people call me paranoid...

I like this decision. Private copying is legal, so the question is if P2P file sharing is private or public. Really, it shouldn't matter, its discouraging to hear the same "its killing music" when the record industry is paid out every time somebody buys a CD-R, audio tape, or MP3 player, they're getting their cut no matter what. The realpolitik is that if the levies on these items get to be too large, in a situation where very few manufactured discs are being sold and many CD-R's are being purchased for example, the public will spit the bit, and start finding alternative ways to get their discs. Like buying them Stateside. Then the levy will have to go up further, to compensate for the missing income, and so the spiral begins.

One of our favourite games at work is called "Spot The Inveiglement". We've had lots of practice, some days the scores we get are astronomical. Let's see how I do today...

"It's like the lifeblood of the industry, that we have to get these 29 teenagers because they are killing our industry,"

Nobody knows if they're teenagers...their privacy is being protected, could be anybody.

"The larger issue is how does government and the courts intend on protecting proprietary rights," said Harvey Nightingale, executive director of the Canadian Interactive Digital Software Association, which represents Canada's videogame publishers and manufacturers.

"I think the government has to." he said. "Can you imagine all the money that would be lost and possible job losses if this ruling were allowed to be carried across all [content] boundaries, to software, publishing, anything you can digitize?"

Software, books, movies, anything else you can digitize are all protected under law, they are not allowed to be copied privately. He's looking after his employers though...

"We presented more initial evidence than has ever been put forward in a request for disclosure of user identities from ISPs — which Canadian courts have granted on numerous occasions," he said.

Canadian courts have granted user identities, but only when crimes are clearly being committed, like child pornography and hate literature. No one even knows if this is a crime yet.

"We remain committed to our plans to enforce the law against unlawful 'file sharing,' which is devastating the entire music community," he said in a statement after the ruling."

Nobody knows if its unlawful or not, in fact that's the main premise of the ruling.

4 inveiglements in 10 minutes, about the same as I do at work. We call it "Spot The Inveiglement", because our original name, "Five Alarm Bullshit" got banned. That was really more of a sport though, we had a little bell that you had to run over and ring, part of the game was playing it cool as you walked towards the bell, if other players could see the happy look on your face as you were walking (never running...running in a Bakery is unsafe) towards the bell, they might be able to ring it before you. The manager took our bell away, he said it hurt his ears, and besides, he didn't like having to yell at staff meetings.

What's that? You think you've just scored a point? Well, I don't think anything I've written is an inveiglement. Oh, old school, original rules? Well I guess so, its something I just made up, so sure, go ahead ring your bell. But remember, when you do, someone will have played the game, and then that makes me less a liar and more a clairvoyant, so you shouldn't have rung it in the first place, so you're sort of in a conundrum. I'd ring my bell, just to help you out, but I haven't got it back from the office yet...

Being the best Squeeze I can be, sorry that's all I have,

Greg!

[mke]

Originally Posted by Rainman

I do. It's the difference between a library (which is nothing but a "file sharing" device, after all) and a booted book distribution operation.

A library doesn't hand out infinite copies of books that you get to keep. And in the UK, at least in university libraries, they were definitely attempting to clamp down on mass photocopying. What I don't understand is how something can pass from legal to illegal simply by not being advertised. I see it like making copies of CDs, sitting on a street corner, spreading the CDs out and not saying anything to anyone, just letting people browse through and take what they want. Is that activity legal, and does it become illegal if I start shouting out: "Free CDs here!"?

"We remain committed to our plans to enforce the law against unlawful 'file sharing,' which is devastating the entire music community," he said in a statement after the ruling."

Nobody knows if its unlawful or not, in fact that's the main premise of the ruling.

Well spotted, I loved that line. "We believe this to be illegal, therefore it is, no matter what the courts say"...

Actually, the judge didn't really deem file-sharing legal, simply that the CRIA hadn't made a good enough case. That's what I understood, at least.

[Uli]

Originally Posted by mke

Actually, the judge didn't really deem file-sharing legal, simply that the CRIA hadn't made a good enough case. That's what I understood, at least.

It's kinda difficult as it is just a press report and not the ruling itself. I read it that the judge sed that file-sharing per se is legal and copyright infringement only starts with distribution. So, some proof of illegal action with the shared file is needed to force the servers to cough up somebody's identity.

[GoodSpeak]

A library does, however, offer a copying service and data bank recovery via their own copied files, xerox availability, computer downloads and stored files on microfilm, CDs and the like.

Nobody gets their undies in a bunch over this.



They check out music recordings, too.

[Dan G]

"Before it constitutes distribution, there must be a positive act by the owner of the shared directory, such as sending out the copies or advertising that they are available for copying."
MKE:
That distinction doesn't make much sense to me.

Agreed-makes no sense. Isn't loading a file sharing program onto your computer, or copying files into a public directory, a positive act? It would seem like one to me.

Goodspeak:
A library does, however, offer a copying service and data bank recovery via their own copied files, xerox availability, computer downloads and stored files on microfilm, CDs and the like.

Nobody gets their undies in a bunch over this.

But the judge in this case fails to acknowledge that all public and academic libraries in Canada pay a licensing fee for having a photocopier available (as do corporate copy shops like Kinkos). It is similar to the levee we have on blank cds, minidiscs, etc. But I think it is actually distributed more efficiently.

Basically, none of the dozens of media reports I've read really understand what this guy meant - my favorite was my local daily which ran a huge front page headline : Judge delares file sharing legal. Where they got that statement, I don't know because as MKE pointsout earlier, all he really did was...not declare it illegal (basically, I don't think the judge has a clue what the issues are and just passed it off to another case).

The prime minister was here over the weekend (my city is hosting the Juno award, the Canadian equivalent of the Grammys) and commented that the gov't would be looking into this ruling because he feels there needs to be protection for artists' copyrights.