2012 SCC 37 (July 12, 2012)
Overview
The Supreme Court of Canada considered whether the photocopying of textbook excerpts by teachers, on their own initiative, to distribute to students as part of course materials, is "fair dealing" pursuant to the provisions of the Copyright Act. A majority of the Supreme Court concluded that the Copyright Board made several errors in its analysis of the "fairness factors" to be considered and thus, allowed the appeal and remitted the matter back to the Copyright Board for reconsideration.
Abstract
The Supreme Court of Canada ("SCC"), in a 5-4 split decision, allowed an appeal from the Federal Court of Appeal ("FCA"), which upheld the Copyright Board's decision that copying of textbook excerpts by teachers, on their own initiative, to distribute to students is not "fair dealing" under the Copyright Act. The key issue before the SCC was whether the copying was "fair" based upon the fairness factors set out in the SCC's earlier decision in CCH Canadian Ltd v Law Society of Upper Canada, 2004 SCC 13 ("CCH"). The majority of the SCC found that the Copyright Board made several errors in its analysis of the "fairness factors" set out by the SCC in CCH and thus the Board's conclusion that the copying was "unfair" was not reasonable. The majority allowed the appeal and remitted the matter back to the Board for reconsideration in accordance with the SCC's reasons.
Case summary
Facts. At elementary and secondary schools across Canada, teachers often make photocopies of portions of textbooks for a variety of uses. This case relates to copies made by teachers, on their own initiative, of short excerpts of textbooks to distribute to students to supplement the courses' assigned textbooks.
The respondent, Access Copyright, filed a proposed tariff with the Copyright Board, which included royalties on the copies in issue. The appellants, which included a number of provincial ministries of education and school boards, argued that the copies should be excluded from the tariff because the copies constituted "fair dealing" and thus did not amount to copyright infringement.
The Copyright Act permits users to make copies of copyrighted works for the purposes of "research or private study" (section 29), "criticism or review" (section 29.1) or "news reporting" (section 29.2). The test for such "fair dealing," as articulated by the SCC in CCH, involves two steps. The first step is to determine whether the dealing is for an allowable purpose from the perspective of the "user" of the copied materials. In this case, the purpose claimed by the appellants was for "research or private study" by the students pursuant to section 29 of the Copyright Act. There was generally no dispute that the copying was for this allowable purpose.
The second step of the test is to consider whether the dealing is "fair" considering the "fairness factors" set out in the CCH decision. The Copyright Board found that the copies in issue were not "fair" in light of these factors. In so concluding, the Board found that:
- given that the copies were not made at the request of the student, the "predominant purpose" of the copies was that of the teacher, namely, "instruction" and not "private study";
- the amount of the dealing was unfair, having regard to evidence that there was voluminous copying of excerpts from the same textbooks;
- there was an alternative to the copying, namely buying the original texts to distribute to the students or to place in the school library; and
- the copies adversely affected or competed with the original works (i.e. the copies were made in substitution of purchasing the original textbooks).
Accordingly, the Copyright Board concluded that the copies were not "fair" and thus did not satisfy the second step of the test for "fair dealing."
The Copyright Board's decision was reviewed on judicial review by the FCA. The FCA upheld the Board's decision as reasonable. The FCA's decision was appealed to the SCC.
Analysis. The issue in dispute before the SCC was whether the Copyright Board's conclusion that the copies were "unfair" was reasonable.
The SCC rendered a 5-4 split decision. The majority allowed the appeal, holding that the Copyright Board's decision was unreasonable. The dissent expressed the view that the Copyright Board's decision was reasonable, and would thus have dismissed the appeal.
The majority held that the Board committed several errors in its consideration of the following fairness factors set out in the SCC's decision in CCH.
(i) "Purpose of the dealing"
The majority held that the Board erred in finding that the teachers made the copies for the separate purpose of "instruction." According to majority, teachers do not have a completely separate purpose of "instruction," but rather facilitate the students' research and private study. Accordingly, the majority concluded that teachers shared a "symbiotic purpose" with students engaged in research and private study. In so concluding, the majority distinguished this case from circumstances where the copier had an ulterior motive unrelated to "research or private study," such as a commercial motive.
The majority also found that the Board had erred in finding that the copies were for the purpose of "non-private" study since they were used in a class rather than privately. In this regard, according to the majority, the term "private" should not be understood as requiring the copies to be viewed in isolation. Rather, the act of studying is essentially a personal endeavor whether engaged in with others or in solitude.
(ii) "Amount of the dealing"
The majority criticized the Board's finding that the "amount of the dealing" was unfair, on the basis that this finding again relied upon a faulty characterization of the teachers' role as being independent and differently motivated from that of the student users. In this regard, the majority found that the "amount of the dealing" factor is not a quantitative assessment of the number of copies, but rather is a comparison between the size of the copied excerpts as compared to the entire work. In other words, the issue is the extent to which the original work is copied, not how many copies were made. However, the majority noted that the total number of copies made remains relevant to a consideration of the "character of the dealing."
(iii) "Alternatives to the dealing"
The majority found that the Board erred in concluding that schools could simply buy the original texts to distribute to each student or to place in the library for consultation as a realistic alternative to the copying in issue. The majority argued that purchasing a greater number of original textbooks for each student was not a realistic alternative to teachers copying short excerpts to complement existing textbooks. According to the majority, this approach would unrealistically require schools "to buy sufficient copies for every student of every text, magazine and newspaper in Access Copyright's repertoire that is relied on by a teacher."
(iv) "Effect of the dealing on the work"
Finally, the majority found that the Copyright Board erred in concluding that the making of the copies competes with sales of original textbooks to an extent that makes the dealing unfair. Rather, the majority held that if such photocopying did not take place, it is more likely that students would go without the supplementary information, or be forced to consult the single copy already owned by the school. Although there was evidence that textbook sales had shrunk in the last 20 years, the majority noted that there was no evidence that the decline was linked to the type of copying in issue, and that several other factors were likely to have contributed to the decline. Accordingly, the majority concluded that there was no evidence demonstrating any link between the copying by the teachers and the decline in textbook sales.
As a result, the majority concluded that, because the Copyright Board's finding of unfairness was based on a misapplication of the "fairness factors" set out in the SCC's CCH decision, the Board's decision was unreasonable. The majority therefore allowed the appeal and remitted the matter back to the Copyright Board for redetermination in accordance with the SCC's reasons.
In contrast, the minority was of the view that the Copyright Board made no reviewable error in principle in construing or applying the CCH factors, with only one minor exception, namely, the finding that the copies compete with sales of original textbooks. However, the minority was of the view that this error did not render the entire decision unreasonable and therefore would have dismissed the appeal.
Conclusion
This decision provides further clarification and guidance on the proper manner of applying the "fair dealing" test set out in the SCC's decision in CCH and, in particular, assessing the fairness factors under the second step of the test.
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