On July 12, 2012, the Supreme Court of Canada clarified the scope of the "fair dealing" exception to copyright infringement, found in section 29 of the Copyright Act (the Act), which allows copies to be made for research, private study, criticism and review.
Facts and Judicial History
As stated in a previous blog post, the case of Alberta (Education) v Canadian Copyright Licensing Agencysurrounds the contention over whether elementary and secondary schools can claim the benefit of "fair dealing" exception for copies of works made at the teacher's initiative for the student's use.
The Copyright Board (the Board) distinguished between copies made by the teacher at the request of a student and copies made by the teacher without prior request from a student. It concluded that copies made by teachers for student use were made for the allowable purpose of "research or private study", but found, applying the CCH fairness factors articulated in CCH Canadian Ltd v Law Society of Upper Canada, that the copies did not constitute fair dealing and were therefore subject to a royalty. The Federal Court of Appeal upheld the Board's conclusion.
The Supreme Court
The decision of the Court hinged on its interpretation of the two-part test for fair dealing, articulated in CCH. There was no dispute on whether the first step was met; therefore, the Court reviewed the Board's analysis of the second step of the test, namely whether the copies were "fair" according to the factors set out in CCH. In a 5-to-4 split decision, the majority determined that the Board's finding of unfairness was based on a misapplication of the CCH factors and therefore, its outcome was unreasonable. The CCH factors underlying what is fair will be examined in turn below.
Purpose of the Dealing
The Court continues to favor user's rights in fair dealing issues as evidenced in its analysis of the "purpose of the dealing" factor. Referencing CCH, the Court concluded that photocopies made by a teacher and provided to primary and secondary students are an essential element in the research and private study undertaken by those students. The Court felt that the Board's distinction between copies made by the teacher at the request of a student and copies made by the teacher without a prior request from a student drives an artificial wedge into the unified purpose of research and private study. The Court noted that the copier's purpose will be relevant to the fairness analysis if the copier "hides behind the shield of the user's allowable purpose" in order to engage in a separate purpose – such as a commercial one (para 22). In this case, the Court held that there was no separate purpose on the part of the teachers.
Amount of the Dealing and Character of the Dealing
The Court emphasized that assessing fair dealing and the amount of the work being copied is not a quantitative assessment based on aggregate use, but rather an examination of the proportion between the excerpted copy and the entire work. The quantification of dissemination should be assessed under the "character of the dealing" factor.
Alternatives to the Dealing
The Court cited CCH in that "a dealing may be found to be less fair if there is a non-copyrighted equivalent of the work that could have been used, or if the dealing was not reasonably necessary to achieve the ultimate purpose" (para 57). It concluded that buying books for each student is not a realistic alternative to teachers copying short excerpts of the work.
Effect of the Dealing on the Work
As for the "effect of the dealing on the work" factor, the Court concluded that there was no evidence to link photocopying short excerpts with a decline in textbook sales and therefore the Board's analysis was unreasonable.
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