Canada: This Week At The SCC (15/02/2013)

Cases Heard

The Supreme Court of Canada heard arguments this week in four interrelated cases of interest to Canadian businesses and professions, and reserved judgment in each.

The four copyright cases, which canvas a variety of issues under the Copyright Act,  arise from the decision of the Québec Court of Appeal in France Animation v. Robinson, 2011 QCCA 1361. Robinson alleged that Cinar's cartoon Robinson Sucroë was a copy of his own work Robinson Curiosité. The trial judge found infringement and the Court of Appeal upheld the Superior Court's finding that an original work existed and was infringed by the defendants Cinar, Ronald A. Weinberg, Christophe Izard, France Animation, Ravensburger FILM + TV Gmbh and RTV Family Entertainment AG. However, the Court of Appeal quashed the trial judge's finding that Christian Davin (President and CEO of France Animation) bore personal liability and reduced the total award to the plaintiffs from $5,224,293 to $2,736,416.

The Supreme Court is expected to comment on the test to be applied to determine whether a material or substantial part of the work has been reproduced. Both the Superior Court and the Court of Appeal found that Robinson's work constituted an original work, even though the project was incomplete.

In addition, both courts below found that an infringing copy is assessed first by its similarities even if there are numerous differences in the rest of the copy. At the Supreme Court, the defendants argued that there are more differences than similarities between the two works and that any similarities may be explained by the fact that Curiosité and Sucroë belong to a common genre, namely children's programming, and both share the same roots: the novel "Robinson Crusoe" by Daniel Defoe. Also, on the issue of the appropriate test to measure the similarity between the characters, the defendants argued that the trial judge committed a palpable error in basing his analysis on the opinion of an expert instead of an "average observer".

The Court of Appeal accepted the defendants' arguments that amounts relating to musical rights should be deducted in calculating the defendants' profits. Before the Supreme Court, the plaintiffs argued that music specifically commissioned and written solely for the synchronization with the images and texts of a cinematographic work is inextricable from the infringing cinematographic work and that the revenues earned from the musical rights should be included in the calculation of profits.

Also under appeal is the Court of Appeal's interpretation of s.35 of the Copyright Act, which the Court found limits the individual liability of an infringer to the profits "that the infringer has made from the infringement." This means that an infringer cannot be ordered to pay more than the profits he himself made. Robinson and Nilem appealed this finding and argued that the Act recognizes that a plaintiff is entitled to a fair share of the profits earned jointly and severally by the infringers.

Also under appeal are the Court of Appeal's reduction of the punitive damages awarded by the Superior Court (from $1,000,000 to$250,000), the finding that officers are personally liable under the Act and the finding that extracontractual liability of a third party may arise.

The oral arguments in the Cinar appeal may be viewed here, and the written arguments may be viewed here. The oral arguments in the Robinson appeal may be viewed here, and the written arguments may be viewed here.

Leave Applications Decided

The Court did not grant leave to appeal in any cases this week, but refused leave in two cases of interest:

  1. Malartic (Ville de) c. Québec (Procureur général), 2012 QCCA 1584, in which the Québec Court of Appeal granted an interlocutory injunction based on a potential threat to drinking water quality and over the acquired rights of companies whose activities may threaten water quality. Malartic, a town of 3,500 persons, was supplied with drinking water by wells. Mining leases were in effect in the same area, and one of the leases authorized the respondent companies to operate a gravel pit.  Analyses revealed that the water level had become low.  Malartic hired experts to conduct research and they found that while water quality was excellent, they advised limiting activities that might diminish that result.  In 2006, the town drilled well P-6 to supplement P-4 and P-5, which were already operational.  In 2010, it drilled P-7 on the neighbouring territory of Rivière-Héva without the consent of that municipality.  Malartic then applied for an injunction against the respondent companies to stop their activities in the vicinity of P-6 and P-7, citing provisions of the Environment Quality Act and the Groundwater Catchment Regulation. The interlocutory injunction granted was based on potential threat to water quality.
  2. Buschau v. Rogers Communications Incorporated, 2012 FCA 197, in which the Federal Court of Appeal upheld the finding of the Federal Court that the applicants were precluded by issue estoppel from re-litigating the issue of their "exclusive" entitlement to surplus in pension plan on termination of plan. The parties were engaged in a long-running dispute over an actuarial surplus accumulated in a defined benefit employee pension plan.  The plan has been administered by the respondent since it purchased the applicants' former employer.  Following litigation between the parties that reached the Supreme Court of Canada, the applicants requested that the Superintendent of Financial Institutions Canada terminate the plan or declare it already terminated. The Superintendent refused, and the applicants sought judicial review of the Superintendent's decision.  While initially successful in the Federal Court, on appeal, the Federal Court of Appeal restored the decision of the Superintendent.  The Supreme Court of Canada refused leave to appeal from the decision of the Federal Court of Appeal.  The applicants then submitted eight questions to the Superintendent which were said not to have been addressed by the Superintendent in her earlier decision or which were said to have arisen since that decision.  The Superintendent decided not to give fresh consideration to the issues.  The applicants' application for judicial review to the Federal Court was dismissed.  The Federal Court of Appeal upheld that decision, and the Supreme Court declined to hear the appeal.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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