an ideal tariff

Last month Howard Knopf reminded us that the Copyright Board is nearing completion of its work on the issue of collective licensing in post-secondary educational institutions. Under discussion are Access Copyright’s requests for tariffs on some unauthorized copying of copyright-protected materials. The Board has in fact invited parties to “comment on the feasibility and clarity of the terms of the tariff.”

While the documents pertaining to the proposed tariffs indicate that students are to be considered as “authorized users,” the aim of collective licensing is largely to address instances where teachers choose to distribute portions of copyright-protected works, often described as excerpts, to students.

Ideally, any tariff for a collective license would hew as close as possible to the principle of individual and fair negotiation between two parties for compensable use of content, and be based on a clear understanding, not only of the market, but also of Canadian copyright law. To that end, let us hope that the Copyright Board will engage in a thorough investigation of three hitherto-unchallenged assumptions, namely that:

1. Unauthorized copying of copyright-protected materials occurs uniformly across institutions.
2. Such unauthorized copying must always be paid for.
3. Appropriate payment has not already been made.

1. The Scale of Unauthorized Copying

In the political arena, Access Copyright’s portrayal of unauthorized copying, as copying running amok at campuses, was met with neither question nor criticism. Ideally, the Board would engage in some investigation of this claim. At the very least, the Board should recognize that when a textbook is assigned to students as their principle source of reference, the question of excerpts (or course-packs) becomes moot.

For instance, a cohort of approximately 200 students pursuing the degree of Bachelor of Applied Sciences in Engineering at a reputable Canadian university are routinely assigned textbooks as their sole resource for learning. (Full disclosure: one of the cohort is my daughter. In her case, depending on what she might spend, she bought new books, used books, or on occasion nothing at all, relying instead on the copy held in the Reserves section of her institution’s library.)

An ideal tariff would ensure that institutions may opt-out on behalf of those students for whom their principal learning resource is not an assemblage of excerpts. While this strongly suggests that many students in the STEM fields will be removed from the FTE count, other disciplines may fall within the same framework. For instance, Nick Mount, a professor in the Department of English at University of Toronto writes: “In all my classes, undergraduate and graduate, I assign and expect students to purchase books, including many books by living Canadian writers. I stopped using course-packs years ago: they’re aesthetically ugly, and their digital replacements don’t work well in classrooms. To the best of my knowledge my colleagues follow much the same practice.”

The calculation of the tariff must reflect only those students who actually consume works by excerpt, but only when such excerpts are entitled to payment.

2. Some types of unauthorized copying 

i. OER.

The use of open-educational resources (OER) is becoming more common in Canada. These works, often funded by taxpayers, and developed by credible authorities in various disciplines, are released under open licenses whereby users (be they teacher or student) may adapt, copy, or post content without additional fees. While adoption of such resources is not uniform across the country, the trend is sloping upward.[1] The Board should take particular note of the efforts at Kwantlen Polytechnic University (KPU), the first institution in Canada where entire programs have been designed on the basis of open resources and are now showing escalating enrollment.

An ideal tariff would ensure that institutions may opt-out on behalf of, and thus remove from FTE count, those students participating in programs for which the institution has actively sought to ensure a zero cost for materials, by developing and/or adopting OER content.

ii. Exceptions.

Within the Copyright Act are various measures[2] that permit unauthorized copying of copyright-protected materials; chief among these is Section 29 Fair Dealing. As use of Fair Dealing has been contentious, the Copyright Board might wish to limit its consideration of fair dealing to only that which has been supported by the Supreme Court of Canada. To that end, the famed CCH case of 2004 is instructive—the final decision was one of unanimity and the measures of content reproduced and accepted as fair dealing ranged from a few pages to 21% of an entire textbook.[3]

Naturally, quantity alone is never solely determinative of fair dealing; however, this must raise at least some question as to why Access Copyright is asking that educational institutions pay a fee for distributing content which may well be fair dealing. Particularly as prior to the amendments of 2012, the Supreme Court sanctioned classroom distribution of short excerpts which were supplemental to principal learning resources, under the auspices of the category of “private study,” within fair dealing.[4]

An ideal tariff would ensure that institutions may remove from FTE count, those students enrolled in courses where supplemental excerpts would sit within the threshold of fair dealing as appropriate under the authority of CCH (2004). As the Copyright Board itself noted in 2009, “CCH now is the unavoidable starting point of any analysis of the notion of fair dealing (para. 75).”

And while the Board’s discomfort was evident then, their careful adherence to the law paved the way to the Board’s more nuanced understanding of fair dealing as was exemplified in 2015:

In CCH, the Supreme Court of Canada stated that fair dealing can be made out either by demonstrating that there exists a general practice that is based upon an enumerated fair-dealing purpose, and, is in fact, fair, or by demonstrating that a particular copying event … was fair dealing (para. 223, citing para. 63 of CCH Canadian).

3. Fair remuneration for copying

Perhaps Access Copyright is behaving in good faith, and is simply unaware of changing patterns of development and distribution of educational resources. However, members of Canada’s publishing sector cannot pretend to be without guile, as it has come to light that they have chosen to license their wares for use in educational institutions, yet insisted to Canadian MPs that the educational community was not paying its fair share. In a comprehensive post, dated to 23 November 2018, Michael Geist laid bare the claims of some Canadian presses – that they were suffering for the lack of payment from educational institutions – when in fact:

… educational institutions typically purchase both access to the work and a licence for multiple uses and/or inclusion in a CMS. This means that the e-book licence replaces the Access Copyright licence, compensating publishers and authors while providing students and teachers with greater flexibility and value. Moreover, many of the licences are perpetual, meaning that rights holders are paid a higher upfront fee in return for no subsequent royalties or payments.

An ideal tariff issued by the Copyright Board would ensure that institutions do not pay a second time for content already paid for through voluntary market-agreements between parties.

From the profusion of briefs submitted to the Federal Government during last year’s Copyright Review, it is evident that, over the last seven years, consumption of content has evolved in the post-secondary community. Educational institutions have come to rely increasingly on licensed content, where licenses are of both the proprietary and open variety. Unauthorized copying reliant on exceptions to copyright is decreasing. And yet, if Access Copyright has its way, Canadian students will be charged fees to cover the costs assessed against their institution, regardless of whether that fee represents actual compensable transactions of content and use by each student.

 

[1] In October 2018, the Scholarly Publishing and Academic Resources Coalition (SPARC) issued promising news with respect to OER: $1 billion of savings had been realized through global adoption of open educational resources. While the lion’s share of this savings was generated in the United States, Canada is onboard with OER development and adoption. Notably, the province of British Columbia alone achieved over $10 million in savings between 2012-2019.

[2] Section 29, Fair Dealing is principle among them. But also applicable to students’ learning are S29.21 NonCommercial User Generated Content and S30.4 Work available through Internet. Plus, there are a host of exceptions addressing Educational Institutions.  The proposals offered by Access Copyright presume to discard the very existence of exceptions; said another way, the very existence of the Copyright Act.

[3] CCH is predominantly known by the Supreme Court’s final adjudication of the case, but scrutiny of the case at the trial division reveals the amounts copied without authorization; see CCH Canadian Ltd. v. Law Society of Upper Canada. (1999)  Para. 136.  These copies were later accepted as fair dealing by the Supreme Court. CCH Canadian Ltd. v. Law Society of Upper Canada, 2004 SCC 13

[4] Alberta (Education) v. Canadian Copyright Licensing Agency (Access Copyright), 2012 SCC 37.

a lesson from the Copyright Board

On 22 May 2015 the Copyright Board released its decision concerning tariff rates for copying carried out in provincial and territorial governments (excluding that of the Province of Quebec). The rates set by the Board fell far short of what Access Copyright had requested; some commentaries indicate that the returns would not cover the costs of the tariff proceedings.

The Board came to its decision via a number of factors, including: (i) scrutinizing Access Copyright’s claim of the extent of both its repertoire and business relations; (ii) deferring appropriately to fair dealing, given the integral nature of the exception within the system of copyright; and (iii) being mindful that copyright only applies when a substantial part of a work has been reproduced.

For commentary, see Michael Geist (here and here), Howard Knopf (here and here), Bob Tarantino (here) and Bobby Glushko (here). To which I add my own. The decision underlines that institutional systems of fair dealing, which includes assessment of substantiality (the threshold of copyright), remain contextual affairs. This lesson is not transparently evident, but it is there.

Copyright owners receive their rights through Section 3.1 of the Copyright Act: “For the purposes of this Act, “copyright”, in relation to a work, means the sole right to produce or reproduce the work or any substantial part thereof in any material form whatever … .” Thus, if the reproduction is insubstantial then copyright does not arise.  This was explicitly stated in CCH Canadian (2004); as Tarantino writes : “… the Supreme Court of Canada [indicates] in its discussion of fair dealing, that where “the amount taken from a work is trivial, the fair dealing analysis need not be undertaken at all because the court will have concluded that there was no copyright infringement.”

But as Tarantino (and the Copyright Board) remind us, the Supreme Court has also indicated, via Robinson v Cinar (2013), that substantiality is “a flexible notion … a matter of fact and degree”, to be decided “by its quality rather than its quantity.”

In its discussion about substantiality, the Board concluded that: “… without the benefit of a qualitative analysis and without even knowing which portions of a work were copied, … 1 to 2 pages of a work [to a maximum of 2.5% of the entire work] are a reasonable approximation in establishing non-substantiality (para. 204).” This measure has been greeted with enthusiasm but it is imperative that educational institutions not sleep walk into creating a de facto ceiling to insubstantiality. It bears emphasizing that the Board has contextualized its own remarks; this measure is appropriate when little or no information is available about the copying.

In terms of institutional practices–where post-secondary communities have endeavoured to develop resources and engage personnel, all to assist faculty in their understanding of appropriate uses of copyrighted material–it is viable to apply a qualitative assessment and allow for the possibility of copying more.

In Intellectual Property (2011), David Vaver makes a valuable point in connection to assessment of substantiality: “One should first screen out what cannot in law be a substantial part. ‘Part’ means ‘portion’ not ‘particle.’ … Copying ten such particles is as inoffensive as copying one (p.182-183).” As is often quoted, but appears not to receive sufficient consideration, facts are not eligible for copyright. Furthermore, processes are unlikely to meet the threshold of originality to be granted copyright. (Arguably, it is ill-advised to be creative when teaching students a process.) It is then likely that in fields of natural science, life science, mathematics and computer science, the threshold of substantiality may be higher. Even in fields typically considered to be more creative, it remains possible that a taking of more than 2.5% will not contravene substantiality when the qualitative analysis is undertaken.

The Copyright Board’s statement should be read in the same spirit as the Fair Dealing Guidelines developed by the Association of Universities and Colleges Canada (AUCC) and Colleges and Institutes Canada (CIC). Those instructions are baselines supporting legitimate unauthorized copying and more copying is always a possibility when individuals are suitably informed, or have access to informed support. It is the combination of baseline rules and discretionary support that constitute an institutional practice of fair dealing.

The Board takes note of the Supreme Court’s measured approach to unauthorized copying in institutional settings:

In CCH, the Supreme Court of Canada stated that fair dealing can be made out either by demonstrating that there exists a general practice that is based upon an enumerated fair-dealing purpose, and, is in fact, fair, or by demonstrating that a particular copying event … was fair dealing (para. 223, citing para. 63 of CCH Canadian).

It was the lack of a robust practice on the part of the provincial and territorial governments involved in the tariff negotiations that resulted in the Board’s scrupulous attention to every incident of copying in the evidentiary sample collected in agreement with Access Copyright and the governments (paras. 223-225).

Generally speaking, post-secondary educational practices in Canada are closely modeled upon the Great Library Access Policy that was at issue in CCH Canadian. Meaning, the policy prescribes minimums, with copying beyond the minimum contingent upon informed discussion. But informed discussion itself can unwittingly be curtailed. Fortunately, the Board reminds institutions to avoid slavish attention to rules to the extent of diminishing the contextual nature of fair dealing. As readers likely know, in CCH Canadian, the Supreme Court followed six factors with which to explore the fair dealing issue at hand; the Board emphasizes that these factors themselves must not become rigid: “… the list of factors … is not an exhaustive list, and fairness is a matter of impression.” The Board continues with a quotation from the work of Giuseppina D’Agostino:

[p]arties pleading fair dealing, and courts ultimately deciding those events, should exercise flexibility when interpreting fair dealing: raise factors germane to the case and assess evidence to support them. Whether there are six factors, seven factors, or four factors should not be the driving preoccupation … (para. 267 citing p. 197 of  The Copyright Pentalogy).

A timely reminder as the post-secondary community moves forward with solidifying their institutional systems of fair dealing.

heads I win …

Last week Howard Knopf alerted us to the latest movement by Access Copyright to impose blanket copyright fees across universities and colleges in Canada, regardless of ongoing work by educational institutions to ensure that legitimate copyright fees are paid and that legitimate fair dealing is not denied. In his post of 17 September 2012 Knopf provides Access Copyright’s statement of case to the Copyright Board of Canada, and draws attention to a number of details including the collective’s position that:

…  the fair dealing policy…  promoted by the Association of Universities and Colleges of Canada and the Association of Canadian Community Colleges and adopted by many Educational Institutions, which purports to characterize as fair dealing amounts of copying essentially identical to that licensed by Access Copyright, is unfair and results in copying that is not fair

The statement of case explains in detail what Access Copyright will do (arguments to be presented, witnesses to be called, evidence to be produced, etc.) when the Copyright Board hears this case on 11 February 2014. The Board will then either signal a shift in thinking on their part, or offer Canadian education yet another opportunity for further strengthening of fair dealing by the Supreme Court of Canada. Unpacking that sentence will take several paragraphs; I ask for patience from readers.

The starting point is the work of law professor Graham Reynolds (previously at Dalhousie University, now at the University of British Columbia). In his chapter “Of Reasonableness, Fairness, and the Public Interest, Judicial Review of the Copyright Board’s Decisions in Canada’s Copyright Pentalogy,” Reynolds illustrates that, when certifying the Access Copyright tariff for educational institutions with respect to photocopies of excerpts in K-12 schools spanning 2005-2009, the Copyright Board applied a very narrow interpretation of the principles enunciated by the Supreme Court of Canada in CCH Canadian v. Law Society of Upper Canada. The Copyright Board’s decision was appealed and finally settled by the Supreme Court (favorable towards fair dealing) in one of the famed pentalogy decisions, Alberta (Education) v. Canadian Copyright Licensing Agency (Access Copyright). The difference of opinion between the Board and the Court leads, as Reynolds suggests, to the conclusion:

[T]hat fairness (in the context of fair dealing) is not as discretionary a concept as it appears to be. [Alberta(Education) … clarifies] that the purpose of the Copyright Act requires a broad, liberal approach to fairness. By implication then, fairness is not broad and open-ended; rather it is infused with certain expectations with respect to the way in which it is to be applied (namely, in a large and liberal manner).

Reynolds makes plain that the purpose of the Copyright Act is evolving, moving away from an author-centric approach to an instrumental-public interest approach. Reynolds is equally specific that such a move is not an abandonment of owners’ rights; instead, the shift only ensures that limitations upon those rights are upheld as necessary to invigorate and maintain the public domain. In their examination of the K-12 situation of excerpts, the Copyright Board aspired to the earlier approach, even though the Supreme Court had consigned that approach to history.

The evolution of purpose of copyright in Canada illustrates a well-functioning system of laws and courts. Those authorities have made it abundantly clear that legal precepts are not immutable; they evolve in concert with developments in society. Evolution may take time, but is infinitely preferable to revolution.

The delay on the part of the Copyright Board can be explained with recourse to its very function; the Board’s mandate begins with:

The Board is an economic regulatory body empowered to establish, either mandatorily or at the request of an interested party, the royalties to be paid for the use of copyrighted works …”

This is not to imply that the Board is solely concerned with setting market prices. Yet it is hardly an accessible venue for discussion of exceptions; the lengthy and expensive process tends to discourage representations of public interest. As Knopf pointed out, even the Association of Universities and Colleges of Canada, in their wisdom, “abruptly withdrew its objections and withdrew from the Copyright Board hearing of April 2012, leaving its member universities unrepresented after having spent about $1.7 million.”

The Board’s past discomfort with endorsing a large and liberal interpretation of fair dealing (in both purpose and fairness) was quite evident; when reviewing the K-12 situation of excerpts, the Board wrote: “CCH now is the unavoidable starting point (para 75).” The connotation of “unavoidable” does not suggest the Board relished the task at hand. However, as Reynolds writes:

The end result is that post-Alberta (Education), the Copyright Board is significantly constrained in its ability to shape Canadian copyright law. Abella J’s reasons for judgment clarify that the Copyright Board does not have unlimited discretion under fairness (and fair dealing more broadly) to implement policy goals or promote values that are inconsistent with the purpose of the Copyright Act, as interpreted by the Supreme Court of Canada.

The difficulty for Canadian educational institutions, and Canadians in general, is that Access Copyright seems happy to play the game of “heads-I-win, tails-we-play-again”. In repeated and continued efforts to roll back the decade-plus evolution of copyright’s purpose — through lobbying, litigation and tariff applications — they display a lack of logic, as well as a questionable use of their members’ resources.

According to Access Copyright’s website, the following portions of the funds collected are withheld before distribution:

An administrative holdback of 20% to cover Access Copyright’s administrative and operational costs.

An allocation of 5% of copyright licensing royalties has been made toward costs for current and future tariff proceedings before the Copyright Board of Canada. These tariff proceedings help us ensure fair compensation for creators and publishers when their works are copied.

An allocation of 1.5% of copyright licensing royalties collected has been made for a cultural fund approved by Access Copyright’s board of directors.

The administrative holdback (20%) is high enough, leading to the question of why a further 5% must be withheld for future days in court. But that is not all; the information for title specific distribution  indicates that an additional 25% of royalties collected through the fee increase covering 2005-2009 has been reserved to “support current and future tariff proceedings held before the Copyright Board of Canada.”

Access Copyright is gambling (with its members’ money) that the Board’s decision will be favourable to copyright holders. But, if the Supreme Court of Canada should be called upon to revisit the issue, Access Copyright would do well to remember that each adjudication of fair dealing at the Court within the last ten years has only raised the profile of fair dealing and strengthened its application.

the free market…

Last week’s dual topics both deserve closer attention; deciding where to focus this week was a challenge. Then a few lines from one of my daughter’s favourite books came to me:

The free market must always be completely free.
The free market must be controlled in certain cases.
The free market must be free enough to control its freedom in certain cases.
The free market must have enough control to free itself in certain cases.

[p.170 of The Mysterious Benedict Society by Trenton Lee Stewart (New York: Little Brown & Company, 2007).]

Within last week’s decision concerning the K-12 tariff on photocopies of copyrighted material at Canadian schools, the Federal Court of Appeal (FCA) addressed the question: “was the dealing fair?” From paragraph 25:

The Board also examined the effect of the dealing on the work. It cited uncontradicted evidence that textbook sales have shrunk over 30 percent in 20 years. Though it admitted it could not define the exact reason for the decline in sales, it nevertheless concluded that photocopying had had an unfair effect (Decision at paragraph 112).

So, turning now to the earlier Copyright Board decision, paragraphs 110-111 give the fuller story:

The uncontradicted evidence from textbook publishers shows that textbook sales have shrunk by more than 30 per cent in 20 years. Several factors contributed to this decline, including the adoption of semester teaching, decrease in registrations, longer lifespan of textbooks, use of the Internet and other electronic tools, resource based learning and use of class sets. We are not able to determine precisely to what extent each factor contributed to this decline.

Despite being unable to determine precisely how these other factors contributed, the Copyright Board decided that there was sufficient impact to make the dealing unfair. (Keep in mind that this was one factor of analysis of the entire decision.)

While I understand that no precise determination can be made, I would like to know to what extent the factors were investigated at all? At the very least, school boards will track enrollment figures; lower enrollment could go a long way to explaining fewer text book purchases. One can only hope that teachers are using the Internet as they see appropriate to support a lesson. I’m not sure what “resource based learning” is but it still warrants explanation. And, judging by the dog-eared, broken-spined textbooks that D. lugs home periodically, I can attest to the “longer lifespan of textbooks”. Mercifully, good teachers can be effective without the glamour of new textbooks. It will be ironic if school boards choose to operate with thrift, only to be held financially accountable for affecting a market. Whatever happened to the market catering to its customers? (I forgot: the market must be controlled in certain cases…)

It’s probably heretical to say this, but could publishers allow that their books may not be useful? That school boards may no longer choose to waste taxpayer dollars on textbooks that claim to support a year’s worth of learning but don’t deliver? The Copyright Board considered the issue of substitution – and decided that in lieu of photocopying, school boards could have purchased the books instead (para.118). This assumes that the books actually meet schools’ needs. I have enough friends who are teachers that I can comfortably question this assumption

Here’s a counterfactual experiment set on the premise that photocopier technology does not exist. Consider this: the books are no longer useful to their intended market at the prices set by the publishers. School districts realize that their labour force include capable teachers whose time in the classroom makes them the best judge of what is helpful to students. Schools stop buying books and encourage teachers to use their own knowledge. And, handily enough, while the photocopier was never invented, digital technology and world-wide networks arrived on cue.

Okay, this is not entirely speculation. Ashlee Vance, of the New York Times, writes about the rise of open-source textbooks. A slow growing trend, but even “the traditional textbook publishers agree that the days of tweaking a few pages in a book just to sell a new edition are coming to an end.”