US embassy cable - 05OTTAWA1571

UNCLAS SECTION 01 OF 02 OTTAWA 001571 
 
SIPDIS 
 
SENSITIVE 
 
DEPT PASS USTR FOR CHANDLER AND ESPINEL 
 
E.O. 12958: N/A 
TAGS: ETRD, KIPR, CA, Technology 
SUBJECT: IPR FILESHARING APPEAL: RIGHTS-HOLDERS LOST A 
BATTLE BUT WINNING THE WAR 
 
REF: A. OTTAWA 1168 (CANADIAN RESPONSE TO GOC'S PROPOSED 
 
        COPYRIGHT AMENDMENTS) 
     B. OTTAWA 1305 (CANADA'S RESPONSE TO 2005 SPECIAL 
        301 REPORT) 
 
1. (SBU) Summary:  The Canadian Recording Industry 
Association (CRIA) is claiming a victory in an Appeals 
Court's rejection of last year's decision by Judge von 
Finkenstein that filesharing does not constitute 
infringement.  CRIA and the other rights-holding plaintiffs 
(the largest musical providers in Canada, who collectively 
own Canadian copyrights in more than 80 percent of the sound 
recordings sold in Canada) plan to again seek the names of 
filesharers, and the appeals decision includes a ringing 
endorsement of the importance of intellectual property rights 
(IPR).  Embassy rights-holder contacts are encouraged, both 
by the "trashing" of Judge von Finkenstein's earlier decision 
and by the court's guidance on future efforts to obtain the 
names of filesharers.  End Summary. 
 
2. (SBU)  Background:  Motions Court Judge von Finckenstein's 
decision last year in the case in which CRIA sought the names 
of filesharers that "downloading a song for personal use does 
not amount to infringement" shocked the IPR community.  Judge 
von Finckenstein added that "...(t)he exclusive right to make 
available is included in the World Intellectual Property 
Organization Performances and Phonograms Treaty...however 
that treaty has not yet been implemented in Canada and 
therefore does not form part of Canadian copyright law." 
This apparent loophole which would seem to make peer-to-peer 
filesharing legal in Canada threatened to make Canada a 
piracy haven and added urgency to industry calls for 
implementation of the already-signed WIPO treaties.  The 
government has said that it will present legislation amending 
the Canadian Copyright Act (ref Ottawa 1168), however this 
legislation has not yet been drafted.  In the absence of 
legislation implementing WIPO, CRIA and others decided to 
appeal Judge von Finkenstein's decision and attempt to 
require ISPs to provide the names of filesharers so that 
rights-holders can sue to stop infringement. 
 
3. (SBU)  The Appeals Court decision upheld the original 
court's refusal to order ISPs to provide the names of 
infringers to the plaintiffs because the Appeals Judge found 
that the evidence against the unknown infringers was 
technically inadequate: among other things, key affidavits 
had been signed by the wrong person.  However, the court 
dismissed the appeal "without prejudice to the plaintiffs' 
right to commence a further application for disclosure", and 
the plaintiffs are already planning their next attempt to 
obtain names of filesharers. 
 
4. (U)  On the more important and far-reaching question of 
whether filesharing constitutes infringement, the 
rights-holders consider the decision to be an unalloyed 
success. The appeals judge explicitly refuted Judge von 
Finkenstein's statements on filesharing and concluded that 
"...if this case proceeds further, it should be done on the 
basis that no findings to date on the issue of infringement 
have been made." 
 
5. (U)  Finally, in a development which bodes well for IPR 
rights-holders in Canada, the Appeals decision included a 
ringing endorsement of the principle of intellectual property 
rights.  The judge stated:  "Copyright law provides 
incentives for innovators--artists, musicians, inventors, 
writers, performers and marketers--to create...Individuals 
need to be encouraged to develop their own talents and 
personal expression of artistic ideas, including music.  If 
they are robbed of the fruits of their efforts, their 
incentive to express their ideas in tangible form is 
diminished."  Addressing the issue of IPR in the internet 
age, the judge stated, "...technology must not be allowed to 
obliterate those personal property rights which society 
deemed important.  Although privacy concerns must also be 
considered...they must yield to public concerns for the 
protection of intellectual property rights in situations 
where infringement threatens to erode those rights." 
 
6. (SBU) Post has seen CRIA's initial in-house assessment of 
the decision, which is enthusiastically positive.  Post will 
continue to press for progress on IPR, following CRIA's 
subsequent court actions and encouraging action on 
legislation.  One potential hurdle to legislation (the 
possibility of elections following a no-confidence vote) has 
been delayed if not eliminated, and Post will use the Special 
301 out of cycle review as well as the SPP as ways to engage 
the Canadian government on IPR issues (ref Ottawa 1305). 
 
Visit Canada's Classified Web Site at 
http://www.state.sgov.gov/p/wha/ottawa 
 
DICKSON