Crank It to 11: Bill C-11 Receives Royal Assent – What Changes for Entertainment Lawyers

Bill C-11 (The Copyright Modernization Act) has received Royal Assent (on June 29, 2012).  In summary terms, here are the top eleven critical changes rendered by this legislation which are of importance to Canadian entertainment lawyers and their clients.

1. Keep Holding Your Horses. It’s important to note that nothing has changed just yet: even though the legislation has received Royal Assent, each provision remains to be declared in force by order(s)-in-council.  We’re now in a bit of a holding period while the government decides when it will declare which portions of the statute to be in effect.  It may decide to do so in one fell swoop, or on a piece-by-piece basis – but until those order(s)-in-council are promulgated, the Copyright Act (Canada), remains in the same state it was prior to Royal Assent, unamended.
2. TPMs Protected.  The Copyright Modernization Act (let’s just call it the CMA) makes it an act of copyright infringement to circumvent a “technological protection measure” (TPM) and/or remove/alter “rights management information” (RMI).  This change greatly enhances the scope and nature of rights which are protected by copyright, and provides content owners (which includes film and TV producers, distributors, book publishers, music publishers and record companies) who elect to make use of TPMs and RMI with a powerful weapon in their arsenal.  That enhancement of rights will need to be grappled with by those who make use of “locked” materials – in this category we could include documentary filmmakers and artists.
3. Online Enabling of Infringement Prohibited.  The CMA creates a new cause of action against those who provide online services “primarily for the purpose of enabling acts of copyright infringement” – meaning that the CMA is very bad news for “pirate” sites.
4. Fussing with Photography.  Good news for photographers (and people, like lawyers, who need to figure out who owns copyright in photographs): the treatment of photographs under the Copyright Act will be rationalized by the CMA, making their treatment consistent with all other types of “works” for purposes of determining authorship and first ownership.  In addition, there will now be a statutory basis for the commissioner of photographs to make private, non-commercial use of the photographs – hopefully avoiding the latent absurdity that individuals who, say, commissioned wedding photographs could infringe copyright by making copies of their own wedding pictures.
5. Moral Rights Extended.  Performer’s will now enjoy, in addition to copyright in their performances, a moral right in their performances.  Contracts may need to be updated to take account of this new right.
6. Private Reproductions Permitted.  The CMA creates a raft of new exceptions to copyright infringement allowing for reproduction for “private purposes” – this will, finally, legitimate activities such as “time shiftting” (e.g., recording a TV show for later viewing), “format shifting” (e.g., moving The Decline of Western Civilization Part II: The Heavy Metal Years from VHS to DVD (sorry, was that out-loud?)), and creating “back-up copies” of software.  There are a variety of statutory requirements to abide by when making “private purposes” reproductions, and, most importantly, this right remains subject to the TPM anti-circumvention provisions noted above.
7. Making Available Right.  It’s always struck me that “making available” a copyrighted work online in and of itself was obviously something reserved to the copyright owner, but the CMA makes this explicit – meaning that content owners have one less hurdle to clear in bringing infringement actions.
8. New “Safe Harbours” for Online Service Providers.  The liability position of online service providers is finally clarified by new exceptions for “network services”, “caching”, “hosting” and providing “information location tools”.  As the delivery of entertainment content moves increasing online, these will be of interest to an increasing number of clients.
9. Notice Me, Notice You.  In contrast to the “notice and takedown” system found in US copyright law, the “notice and notice” approach which had organically grown in Canada over the last 15 years has now been enshrined in legislation: upon receipt of a notice of purportedly infringing content, service providers must pass along the notice to the person identified as responsible for posting the content – or else be subject to statutory damages of between $5,000 – $10,000.  Important not just for internet giants like Rogers and Yahoo!, but also smaller undertakings which allow users to post content.
10. Fair Dealing Expanded.  To the existing categories of research, private study, news reporting, criticism and review, the CMA adds parody, satire and education.  Parody and satire will likely prove useful to creators in a variety of fields: from live theatre to television sketch comedy, from graphic novels to online webisodes.  (Education, whose inclusion was hugely controversial, will likely prove to be a catalyst for seemingly endless bouts of litigation and uncertainty.)
11. UGC.  The “user-generated content” (or UGC) or “YouTube” exception.  A provision remarkable for a number of reasons, not least the sheer innovative verve it evidences, the UGC provision will allow individuals to create “mash-ups” of existing works for “non-commercial purposes” and avoid any liability for infringement (subject to compliance with a short set of conditions, and subject, again, to the TPM rights noted above).  This obviously impacts content owners, but also users – and what is perhaps the most interesting (or problematic!) element of the provision has been largely overlooked: notwithstanding the colloquial appellation of “YouTube exception”, its scope is actually not limited to online or digital uses.

Legislation doesn’t come self-interpreting, of course – so much of the impact of the CMA will only be determined by future attempts to apply its provisions and any resulting court decisions.  There are obviously also many, many, many other changes wrought by the Copyright Modernization Act – one item which could have made it onto the foregoing list is the change to the statutory damages regime which creates a bifurcation between “commercial” and “non-commercial” infringements (with the latter being capped at $5,000 for all infringements taking place prior to the action for damages).  But in terms of day-to-day practice impact, my vote is for the foregoing 11 items.