The Federal Court of Canada recently granted three large broadcasters an order for an
injunction* against retailers of pre-loaded
"plug-and-play" set-top boxes. The apps pre-loaded
on the boxes allow consumers to access TV programs and movies
without cable or other subscriptions. As Madam Justice
These boxes have several uses for consumers,
some of which are perfectly legal and some which skirt around the
fringes of copyright law. This is not the first time a new
technology has been alleged to violate copyright law, nor will it
be the last.
In her view, the allegations in this particular instance were
strong enough to support a prima facie case of copyright
infringement and the injunction order. The matter
will proceed to trial at a later date to resolve the various
copyright and related issues.
A focus on the copyright issues
Bell, Rogers and TVA/Videotron each have exclusive rights under
the Copyright Act to – in lay terms –
broadcast, deliver and copy a range of TV programs
and movies in Canada. The television business
model relies on broadcasters' ability to exploit
these rights. The Plaintiffs argued that
pre-loaded set-top boxes represent an existential threat to
[their] line of business as piracy is one of the top causes for
declining subscriptions for television services in Canada and leads
to annual decreases in revenue.
A central question before the Court was whether the set-top box
retailers were simply the "conduit" for
consumers' infringing activities, or were instead themselves
infringing copyright. The Copyright Act does provide
a limited shield for "conduit" services that provide only
the means to deliver copyright-protected programs, images or
2.4(1) For the purposes of communication
to the public by telecommunication, [...] (b) a person
whose only act in respect of the communication of
a work or other subject-matter to the public consists of
providing the means of telecommunication necessary for
another person to so communicate the work or other
subject-matter does not communicate that work or other
subject-matter to the public.
The Court found that this statutory defence was not
available to the Defendants. They had, said the
Court, deliberately encouraged consumers to use the set-top
boxes to circumvent the broadcasters' subscription-based
services. They had promoted their set-top boxes to consumers
as a means to cancel their cable subscriptions (using slogans
such as "Original Cable Killer"), and had also offered
tutorials on how to use the pre-loaded apps to obtain
"free" programming. The Court said that these
activities "went above and beyond" selling a simple piece
of hardware, and instead related to the content of the
copyright-protected programming. This constituted
prima facie infringement.
The Court also agreed with the broadcasters
that inducing and authorizing consumers to infringe
copyright was an additional serious issue to be
The Court's order not only enjoins the five named retailers
from continuing to configure, market and sell the pre-loaded
set-top boxes; it allows the broadcasters to serve the order
on other retailers who are engaged in the same activities.
*Thanks to Smart & Biggar for making the link
to the decision available online.
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