1CCIL Panel on Intellectual Property – Jurisdiction in the Internet Age

McCarthy Tétrault LLP / mccarthy.ca McCarthy Tétrault LLP / mccarthy.ca / November 2011

CCIL Panel on Intellectual Property – Jurisdiction in the Internet Age

Daniel G.C. Glover, McCarthy Tétrault LLP

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2CCIL Panel on Intellectual Property – Jurisdiction in the Internet Age

McCarthy Tétrault LLP / mccarthy.ca

Why Is Jurisdiction Important?• The Internet makes cross-border events routine• Different standards apply in different countries• Relevant to ©, ™, privacy and defamation• Forum conflicts increasingly prevalent

• Perfect 10 pursuing Google in the United States and Canada, potentially with different results

• Supreme Court has recognized “the spectre of overlapping liability” but suggests “the answer lies in the making of international or bilateral agreements”

• These agreements exist between collective societies, but not on a country-to-country level

3CCIL Panel on Intellectual Property – Jurisdiction in the Internet Age

McCarthy Tétrault LLP / mccarthy.ca

Berne Convention, Art. 5(2)

“The enjoyment and the exercise of these rights shall not be subject to any formality; such enjoyment and such exercise shall be independent of the existence of protection in the country of origin of the work. Consequently, apart from the provisions of this Convention, the extent of protection, as well as the means of redress afforded to the author to protect his rights, shall be governed exclusively by the laws of the country where protection is claimed.”

Is this a principle of non-discrimination? Is it a choice of law rule?

4CCIL Panel on Intellectual Property – Jurisdiction in the Internet Age

McCarthy Tétrault LLP / mccarthy.ca

There Is No Consensus on What Art. 5(2) Means!

“The national treatment obligation of the Berne Convention … suggests that some notion of ‘place’ … should be controlling. But… it is not clear which ‘place’ is the most relevant.” - Graeme B. Dinwoodie“Article 5(2) might direct the application of the forum’s conflict law (or even its substantive law), but it does not tell us the basis on which the forum became the forum. … At most, then, article 5(1) and (2) anticipate that the law of the territories on which alleged infringements occur will determine most questions regarding the existence of protection, its scope, and the available remedies.” - Sam Ricketson & Jane C. Ginsburg“[Article 5(2)] is, in a way, a confirmation of the independence of protection, and underlines that there is no need to refer to the law of the country of origin in these respects.” - WIPO Guide to the Copyright and Related Rights Treaties

5CCIL Panel on Intellectual Property – Jurisdiction in the Internet Age

McCarthy Tétrault LLP / mccarthy.ca

Tariff 22 (Supreme Court of Canada, 2004)

• Copyright law respects the territorial principle, reflecting the implementation of a “web of interlinking international treaties” based on the principle of national treatment

• The applicability of our Copyright Act to communications that have international participants will depend on whether there is a sufficient connection between this country and the communication in question for Canada to apply its law consistent with the “principles of order and fairness ... that ensure security of [cross-border] transactions with justice”

• A telecommunication from a foreign state to Canada, or a telecommunication from Canada to a foreign state, “is both here and there”. Receipt may be no less “significant” a connecting factor than the point of origin (not to mention the physical location of the host server, which may be in a third country).

6CCIL Panel on Intellectual Property – Jurisdiction in the Internet Age

McCarthy Tétrault LLP / mccarthy.ca

Sirius Canada v. CSI, 2010 FCA 348

• Sirius Canada offers satellite radio services• CSI is a collective society administering the right to

reproduce• To deliver the service to Canadians, Sirius contracts with

studios in the USA• The studios make copies that are used to beam a signal to a

satellite for reception across North America• Sirius Canada did not contest liability respecting broadcasts

received in Canada• Did Sirius Canada infringe the Canadian Act by authorizing

U.S. reproductions?

7CCIL Panel on Intellectual Property – Jurisdiction in the Internet Age

McCarthy Tétrault LLP / mccarthy.ca

Sirius Canada v. CSI, 2010 FCA 348 • Federal Court of Appeal rejects argument that the “real and substantial connection” test applies to reproductions.• While CSI argued that rightsholders would suffer because of lack of coverage, the FCA found it was wrong to “assume that the making of the copy in these circumstances cannot be subject to the copyright laws of the United States.”• Tariff 22 case distinguished because it required a determination of the location of a communication initiated in one country and received in another. The principle does not apply where the completed copy exists only in one location.• Although the alleged acts of authorizing occurred in Canada, they are not actionable under the Copyright Act where the primary infringement occurs outside Canada.

8CCIL Panel on Intellectual Property – Jurisdiction in the Internet Age

McCarthy Tétrault LLP / mccarthy.ca

SAIF v. Google (Paris Court of Appeal, Jan. 2011)

• Google indexed, cached and made visual works available• Indexing and caching take place in U.S., which is also the

place of the transmission• Google relied on U.S. law to assert fair use defences • Court of First Instance interprets Art. 5(2) to require

application of the law of the place where the alleged harm was produced

• Court of Appeal reverses, requiring application of the law of the place where the alleged harm was sustained

• Decision on choice of law does not impact result, as Google is found to qualify as a neutral intermediary under French law

9CCIL Panel on Intellectual Property – Jurisdiction in the Internet Age

McCarthy Tétrault LLP / mccarthy.ca

Google Inc v Copiepresse et al (Belgian Court of Appeal, 9th Chamber, May 2011)

• Google claimed that U.S. law applied because it cached articles in the U.S. and transmitted article titles and extracts to Belgian readers from the U.S.• Google relies on U.S. law to assert fair use and avoid moral rights claims• Authors and publishers claimed that Belgian copyright law applied because Belgium had the closest connection to the acts of infringement• Court of Appeal finds that all acts are subject to Belgian copyright law on test of closest connection• Google found to have infringed copyright and moral rights

Should the Court have distinguished between reproductions and communications to the public?

10CCIL Panel on Intellectual Property – Jurisdiction in the Internet Age

McCarthy Tétrault LLP / mccarthy.ca

Columbia v. Fung (Central Dist. Cal.)

“United States copyright law does not require that both parties be located in the United States. Rather, the acts of uploading and downloading are each independent grounds of copyright infringement liability. Uploading a copyrighted content file to other users (regardless of where those users are located) violates the copyright holder’s §106(3) distribution right. Downloading a copyrighted content file from other users (regardless of where those users are located) violates the copyright holder’s §106(1) reproduction right… Accordingly, Plaintiffs need only show that United States users either uploaded or downloaded copyrighted works; Plaintiffs need not show that a particular file was both uploaded and downloaded entirely within the United States.”

- Decision on Permanent Injunction, May 10, 2010

11CCIL Panel on Intellectual Property – Jurisdiction in the Internet Age

McCarthy Tétrault LLP / mccarthy.ca

ALI Principles Governing Jurisdiction, Choice of Law and Judgments

“These Principles endeavour to refine the connecting factors derived from the Berne Convention and its article 5.2.… Earlier drafts… envisioned a commercial environment in which the importance of national borders would progressively wane. Given that impending future, the Principles offered an opportunity to devise forward-looking rules… While multinational distribution implicates many countries, to view the dispute as a collection of local litigation sticks in a worldwide bundle is to overlook the real scale of the enterprise. “Nonetheless, territoriality remains a powerful intuition. It is difficult to accept the proposition that an act unlawful in one territory should give rise to liability in another, where that same act is permissible, even where that territory is part of a global market.… These Principles thus retain the basic rule of territoriality, but allow the parties to simplify the choice of applicable laws by agreement, and when an infringement is instantaneous and worldwide.”

• Applied in Lucasfilm v Ainsworth [2011] UKSC 39• Considered in Columbia Pictures v. Wang, 2006 SKCA 97

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