Does listening to music excerpts online amount to fair dealing?

Authors: Emir Aly Crowne-Mohammed (University of Windsor, Faculty of Law, Windsor, ON, Canada) and Yonatan Rozenszajn (former Law Clerk, Federal Court, Canada)

Society of Composers, Authors and Music Publishers of Canada v Bell Canada, et al., 2010 FCA 123, 14 May 2010

Citation: Journal of Intellectual Property Law & Practice, doi:10.1093/jiplp/jpq089

In Canada the Federal Court of Appeal agrees with the Copyright Board that the fair dealing exception relating to ‘research’ is broad enough to cover 30-second ‘previews’ of songs online.

Legal context

Section 29 of Canada's Copyright Act, RSC 1985 provides (among other things) that ‘fair dealing for the purpose of research or private study does not infringe copyright’.

Facts

The Copyright Board, created under the Copyright Act, is ‘empowered to establish, either mandatorily or at the request of an interested party, the royalties to be paid for the use of copyrighted works, when the administration of such copyright is entrusted to a collective-administration society. The Board also has the right to supervise agreements between users and licensing bodies and issues licences when the copyright owner cannot be located’: Copyright Board of Canada: Our Mandate.

In 1995 the Society of Composers, Authors and Music Publishers (SOCAN), a collective society under the Copyright Act, which administers performing rights in Canada, applied to the Copyright Board for the approval of tariffs on musical works communicated over the internet. As part of this application, SOCAN called for a different (and higher) tariff rate for music downloads that offered 30-second previews (or less) versus downloads that were offered without previews.

A number of parties which included broadcasters, internet service providers (ISPs), and Apple Canada Inc. challenged one or more of the proposed tariffs on a number of grounds, but not on fair dealing. The Board on its own initiative raised the issue of whether offering previews of musical works online amounted to fair dealing for the purpose of research and was therefore not compensable by way of a tariff.

The first part of the Board's decision was released on 18 October 2007 (Collective Administration of Performing Rights and of Communication Rights (Re) Copyright Act, subsection 68(3) File: Public Performance of Musical Works Statement of Royalties to be Collected by SOCAN for the Communication to the public by Telecommunication, in Canada, of Musical or Dramatico-musical Works Tariff No. 22.A (internet – Online Music Services) 1996–2006 [2007] CBD No. 7). In this decision the Board concluded (among other things) that providers of online music previews were entitled to rely on the fair dealing provisions of the Copyright Act since listening to 30-second previews before deciding to permanently purchase a musical work should be regarded as a form of consumer research. SOCAN sought a judicial review of the decision by the Federal Court of Appeal.

Analysis

In deciding that the Board's reasoning was neither unreasonable nor in error, the Federal Court of Appeal adopted the ‘large and liberal’ approach to the research exemption under the Copyright Act's fair dealing exemptions as set out by the Chief Justice of the Supreme Court of Canada in CCH v Law Society of Upper Canada [2004] 1 SCR 339 at para. 51:

...‘Research’ must be given a large and liberal interpretation in order to ensure that users' rights are not unduly constrained. I agree with the Court of Appeal that research is not limited to non-commercial or private contexts.

That decision emphasized that the ‘fair dealing exception, like other exceptions in the Copyright Act, is a user's right. In order to maintain the proper balance between the rights of a copyright owner and users' interests, it must not be interpreted restrictively’ (para. 12). In keeping with this approach, the Federal Court of Appeal noted that the term ‘research’ as it was used in the Copyright Act, was not limited by qualifiers like ‘scientific’, ‘economic’ or ‘cultural’. Accordingly that term could be interpreted in a context-specific inquiry.

Given the nature of the ‘research’ involved in users listening to the 30-second clips or previews of songs online, the court felt that research be given its primary and ordinary meaning, this being the use of previews to help consumers in their search for a particular song as to ensure its authenticity and quality before purchasing it. In this context, ‘research’ included consumer research.

The court then examined whether a 30-second preview, or less, was fair. The Federal Court of Appeal agreed with the Copyright Board in holding that the amount of the dealing is presumptively fair, given the length of the complete work.

Practical significance

The Federal Court of Appeal ruling follows the clear guidance of the Chief Justice of the Supreme Court of Canada in CCH v Law Society of Upper Canada [2004] 1 SCR 339 and rightly expands the numbers of activities that may fall within the fair dealing exemption for research. Indeed, copyright law is often touted as a balance between users and creators. This decision goes beyond mere ‘lip service’ and empowers users with powerful rights – rights which become particularly relevant in the new digital economy.