Canada Kicks Ass

Sharing music over Internet not illegal, Federal Court rules.
Date: Monday, April 05 2004
Topic: Entertainment

Canadian Internet music fans can breathe easy with Wednesday's Federal Court decision that will protect them from the prying eyes of the Canadian Recording Industry Association.

In a move that marks a blow to the recording industry and online music sellers, computer users who freely share music online were delivered a reprieve from the industry's plan to file lawsuits against 29 John and Jane Does it alleges are high-volume music traders.

Story from- Vancouver Sun: http://
Justice Konrad von Finckenstein ruled Wednesday that the CRIA did not prove there was copyright infringement by the 29 so-called music uploaders. The ruling means Internet service providers won't have to hand over the users' names, a prospect that had already sent a chill through the music-sharing community.

It was more bad news for the recording industry that was already scrambling to denounce a study released on the eve of the court decision by researchers at Harvard University and the University of North Carolina. The study found, contrary to industry claims, that online file-sharing isn't responsible for the decline in CD sales.

In what analysts termed a stunning decision, von Finckenstein ruled that file-sharing, the uploading and downloading of files over the Internet using shared directories like those on Kazaa, is not illegal under Canadian copyright law, reaffirming what the Copyright Board of Canada has already ruled.

The overriding issue saw the court rule there is no infringement of copyright in the file-sharing practice.

"No evidence was presented that the alleged infringers either distributed or authorized the reproduction of sound recordings," Von Finckenstein wrote in his 28-page ruling.

"They merely placed personal copies into their shared directories which were accessible by other computer users via a P2P [peer-to-peer] service."

Peer-to-peer is a type of connection between two computers; both perform computations, store data and make requests from each other, unlike a client-server connection where one computer makes a request and the other computer responds with information.

Von Finckenstein compared the action to a photocopy machine in a library.

"I cannot see a real difference between a library that places a photocopy machine in a room full of copyrighted material and a computer user that places a personal copy on a shared directory linked to a P2P service," wrote the judge, who was commissioner of competition at the Competition Bureau of Canada from 1997 until last summer when he was appointed to the Federal Court of Canada.

The CRIA vowed to fight the ruling which was cheered by technology and privacy advocates alike.

"It's not just a victory for file sharers, it is a victory for technology itself and for Internet users in Canada," said Howard Knopf, a lawyer with the Ottawa firm Macera and Jarzyna, representing the Canadian Internet Policy and Public Internet Clinic.

"It is a victory for anybody who does research, who is interested in innovation, education -- anything where file-sharing might play a role."

The court decision puts an immediate block to plans announced Tuesday by the International Federation of the Phonographic Industry to take its fight against file-sharing to several countries around the world, including Canada. The IFPI said 247 file-sharers worldwide would be targeted with lawsuits, including users in Canada.

The IFPI is based in England and was not available to comment on whether it is changing its plans since file-sharing has been ruled legal in Canada.

In Canada, the Canadian Recording Industry Association vowed to continue fighting what it calls the "widespread infringement of music copyright on the Internet."

CRIA general counsel Richard Pfohl said the association expects to appeal the decision.

"In our view, the copyright law in Canada does not allow people to put hundreds or thousands of music files on the Internet for copying, transmission and distribution to millions of strangers," he said in a prepared statement.

"We put forward a compelling case of copyright infringement in seeking these disclosure orders. We presented more initial evidence than has ever been put forward in a request for disclosure of user identities from ISPs --which Canadian courts have granted on numerous occasions."

The CIRA motions filed on Feb. 11, if granted would have required Bell/Sympatico, Rogers Communications, Shaw Communciations, Telus Corp. and Videotron Telecom to reveal the identities of subscribers it alleged were sharing music on a large scale.

Not surprisingly, the ruling pleased Sharman Networks, the company behind Kazaa.

"We welcome today's ruling as a win for peer-to-peer technology and its users," said Nikki Hemming, chief executive officer at Sharman Networks, the Australia-based company that owns Kazaa and operates

"We hope that this decision marks a turning point away from litigation and towards cooperation between peer-to-peer providers and the entertainment industry."

Calling the decision "stunning," Michael Geist, a professor at the University of Ottawa specializing in Internet and e-commerce law and technology counsel with the law firm Osler, Hoskin and Harcourt said he anticipates it will push the industry to increase its lobbying efforts for legislative change to copyright laws

"Certainly the copyright aspects of this decision came as a bit of a surprise to a lot of people," he said.

Geist said there were questions about the evidence advanced by the recording industry, weaknesses that were pointed out by the judge.

The recording industry was seeking to tie IP (Internet protocol) addresses and names, a method that wouldn't guarantee making a correct identification of people who are heavy file-sharing users.

"You're not necessarily talking about a single person, or the same person," said Geist.

Knopf agreed.

"If you're living in an apartment building and have WiFI network and you're not very careful about how you set it up, you could be sharing your network with 300 of your friends and neighbours," he said, adding the user wouldn't necessarily know if someone was engaged in extensive file-sharing using the same IP address. (WiFi -- wireless fidelity -- is a local area network that uses high frequency radio signals to transmit and receive data over distances of a few hundred feet.)

Geist pointed out that the ruling could have simply stopped with that issue.

"The judge could have ruled on this alone but he went much further," he said.

The ruling dealt with the issue of privacy and striking a balance between privacy and the right of copyright holders and also with the ISP's contention that they should be compensated for the cost of complying with the motion if it were to go through.

The ruling thrilled Peter Bissonnette, president of Shaw Communications, whose company had vowed to protect the privacy of its subscribers.

"As you can well imagine we're delighted at Shaw as are Jane and John Doe who were certainly named in their warrants," he said. "We're delighted that the arguments that we put forth were in fact compelling enough for the judge to make the decision.

"He really looked at those two issues: One was the whole issue of privacy as well as the unreliability of the data that they were asking for."

Bissonnette said Shaw customers appreciated the company going to bat for them.

In the U.S. some Internet file sharers were forced to settle for thousands of dollars with the Recording Industry Association of America and Bissonnette said Wednesday's ruling protects Canadians from such actions.

"The CRIA thought they had a slam dunk," he said. "You can look at what's happened in the U.S. and the approach of the recording industry there, which is somewhat bullying."

For Telus, both an Internet service provider and a seller of online music through Puretracks, Wednesday's ruling had a double impact.

Jay Thomson, assistant vice-president of broadband policy for Telus, said the company was glad the ruling protected the privacy of its customers.

"It's a very interesting decision," he said. "I think there is going to be a fair amount of fallout from it.

"It shows we stepped up when it comes to addressing our customers' concerns and we're pleased with the results and think they will be too."

Thomson said it is too early to determine what impact the ruling will have on Puretracks' online sales.

"We have a marketing arrangement with Puretracks," he said. "We certainly have an interest in promoting that service as clearly one that is a legitimate service and provides the kind of access to music that might not be available through the peer-to-peer networks.

"It's too early to say as a result of today's decision what the impact will be on services like Puretracks."

Story¬ From-Vanocouver Sun: http://

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