Canada: Collett v. Northland - "Retribution And Denunciation" For Egregious Infringement That Raises Questions On The Scope Of Copyright And Moral Rights

In Andrew Collett v. Northland Art Company Ltd. et al (2018 FC 269), Justice Gleeson of the Federal Court awarded $100,000 in damages for copyright and moral rights infringement, punitive damages and costs, plus a permanent injunction and pre- and post-judgment interest.

The plaintiff Collett is a professional photographer whose prints had been distributed and sold by one of the defendants. He terminated the arrangement after the business relationship deteriorated, but the defendant continued to use the plaintiff's works. After an interim injunction was granted at an earlier stage in the proceeding, Justice Gleeson had previously found in favour of the plaintiff on the issues of copyright subsistence and ownership. The current decision followed a summary trial to deal with the issues of infringement and remedies.

Although there were two defendants, Justice Gleeson found that only one of them was liable for damages. The plaintiff claimed that the two companies shared the same offices, ownership, and management, and oral evidence from a principal indicated one defendant company was a subsidiary of the other and that they were "all the same company." Justice Gleeson noted that one of the corporate entities did not exist at the time that the infringements occurred, and hence could not be liable. However, the oral evidence that the two defendants were "all the same company" was nevertheless enough to warrant an injunction against both entities.

Justice Gleeson engaged in a detailed analysis of the liable defendant's conduct in respect of each of the eight works at issue, namely six photographic works and two web pages. He found that the defendant infringed the plaintiff's copyright and moral rights in one of the works, and copyright alone in two other works as well as the web pages. In particular, Justice Gleeson found the defendant had scanned the plaintiff's work, "Spirit of Our Land," had a graphic designer replace the plaintiff's signature on the photograph with a different name, and then sold unauthorized copies of the misattributed work. He described this infringement as "flagrant and deliberate", and demonstrative of the defendant's bad faith.

Justice Gleeson declined to consider infringement of the right to the integrity of the "Spirit in Our Land" work under section 28.2, since he already found that the defendant infringed both the plaintiff's copyright and also his moral right of attribution under section 28.1 of the Act. The plaintiff claimed that the defendant's scanning of the work "necessarily" resulted in lower resolution copies that were inferior to authorized prints, and that the availability of these copies "in the marketplace threatens the integrity of[the plaintiff's] work and is damaging to his reputation." This seems to suggest that multiple infringements do not give rise to individual remedies – i.e. moral rights infringements do not "stack". There is no prohibition in the Copyright Act against the award of separate remedies for infringement of both the right of attribution and the right to integrity, yet this appears to be implicit in Justice Gleeson's reasoning. It remains to be seen whether this will have an impact on moral rights infringement cases going forward.

It is also interesting that Justice Gleeson found infringement of the plaintiff's copyright in his web pages. While the plaintiff alleged that the defendants "reproduced the entirety" of the web pages, it is unclear from the reasons whether the web pages were actually copied, or whether the defendant simply had a link to Collett's website. While the defendant's principal testified that any link to Collett's website was "accidental" and he alleged his website had been hacked, Justice Gleeson found his evidence to be "confused, evasive, and in many respects incredible". Justice Gleeson then held that copyright in the web pages and the photo had been infringed because the defendant "continued to maintain a link to [the plaintiff's] website knowing it was not authorized to do so." It is not clear how simply maintaining a link to a website provides sufficient basis for a finding of infringement, or whether this decision signals a new development in liability for unauthorized use of copyright protected works online.

Justice Gleeson's infringement analysis regarding the plaintiff's photograph titled "Morning Paddle" raises questions as to the scope of copyright protection. Although the defendant had displayed "Morning Paddle" for sale online and at trade shows after the plaintiff had terminated their relationship, the plaintiff did not prove any sales of unauthorized copies. The Court accepted the defendant's argument that any sales it made were simply disposing of a limited number of authorized copies that it held in inventory. However, the Court did not mention any specific contractual terms between the parties, and so it is not clear what rights the defendant may have had to reproduce the photograph and post it online, which would appear on its face to be an unauthorized reproduction and an infringement.

In assessing statutory damages, Justice Gleeson considered the facts of each infringement. The defendant's conduct showed disregard for the plaintiff's rights, and in particular the infringement of "Spirit of Our Land" involved unauthorized reproduction, intentional misattribution, and sale to the very market the plaintiff relied upon for his business. Additionally, the defendants' failure to comply with court due dates, and the ease of infringement using modern technology, compelled Justice Gleeson to award the maximum statutory damages of $20,000 for the infringement of copyright in "Spirit of Our Land." Less egregious conduct in respect of another work gave rise to an award of $10,000, and the infringing links to two pages on the plaintiff's website each warranted awards of $7,500.

Justice Gleeson noted another proceeding against essentially the same defendants, Lorenz v Northland Art Company Canada Inc et al (T-376-17), in which Justice Russel granted a summary judgment holding the defendants jointly and severally liable for copyright and moral rights infringement, as well as punitive damages and costs. The defendants' conduct in Lorenz was even more brazen in that they had attributed the plaintiff's photograph to a fictitious author and created a corresponding biography, and this factored into Justice Russel's $10,000 award for moral rights infringement . Justice Gleeson awarded the same amount for infringement of Collett's moral rights, observing that the circumstances in Lorenz were "strikingly similar to those in this case."

Finally, Justice Gleeson found that "the quantum of statutory and moral damages awarded are insufficient to adequately address the objectives of retribution and denunciation which are warranted in this case," and additionally awarded punitive damages. In quantifying the punitive damages, Justice Gleeson considered the range for such damages as set out in Microsoft Corporation v Liu (2016 FC 950), where Justice Boswell observed that recent punitive damages awards tended to range "from $15,000 to $100,000." Notwithstanding the defendant's egregious bad faith conduct, Justice Gleeson found $100,000 to be "excessive" and instead awarded "substantial" punitive damages in the amount of $25,000.

Northland presents an interesting example of damages for copyright and moral rights infringement in the face of a particularly brazen defendant. Justice Gleeson's findings raise significant questions about the scope of protection for both copyright and moral rights, specifically the infringement of the website via unauthorized linking, the lack of infringement of "Morning Paddle," and the unavailability of concurrent moral rights claims. It remains to be seen how these findings will play out in future decision or if they will ultimately be context-specific responses to particularly egregious conduct.

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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Max Rothschild
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