2012 SCC 38 (July 12, 2012)
The Supreme Court of Canada confirmed that pre-existing sound recordings that accompany a cinematographic work are part of a soundtrack and are therefore excluded from equitable remuneration under the Canadian Copyright Act.
The Canadian Copyright Act ("Act") entitles performers and makers of published sound recordings to equitable remuneration for performance in public, or for communication to the public by telecommunication, of the sound recordings. Re:Sound is a collective society that collects such equitable remuneration. Re:Sound filed two tariff proposals claiming royalties for the use of sound recordings embodied in movies, or in programs broadcast by certain television services. The Act defines a sound recording to exclude any soundtrack of a cinematographic work where it accompanies the cinematographic work. The Supreme Court of Canada ("SCC") affirmed decisions of the Federal Court of Appeal and of the Canadian Copyright Board refusing the tariff proposals because sound recordings accompanying a cinematographic work, even if pre-existing, are part of a soundtrack and are therefore excluded from the definition of sound recording.
Facts. Re:Sound is a collective society authorized to collect equitable remuneration under section 19(1) of the Canadian Copyright Act. Subsection 19(1) implements neighbouring rights according to the Rome Convention by entitling performers and makers of published sound recordings to equitable remuneration for performance in public, or for communication to the public by telecommunication, of the sound recordings.
Re:Sound filed two tariff proposals, Tariffs 7 and 9. Tariff 7 claimed royalties for the use of sound recordings embodied in a movie, by motion picture theatres and other establishments exhibiting movies. Tariff 9 targeted the use of sound recordings in programs broadcast by commercial over-the-air, pay, specialty and other television services.
Analysis. As defined in section 2 of the Act, a sound recording excludes any soundtrack of a cinematographic work where it accompanies the cinematographic work. Re:Sound argued that a soundtrack in that definition means the entire collection of sounds accompanying the movie as a whole, and not the individual elements of the soundtrack. Therefore, according to Re:Sound, a pre-existing sound recording, subsequently incorporated into a movie soundtrack, remains a sound recording under section 2 of the Act even where the soundtrack accompanies the movie.
The Canadian Copyright Board, the Federal Court of Appeal and the Supreme Court of Canada all rejected Re:Sound's argument by finding no legislative intent to treat a soundtrack in section 2 of the Act as meaning only the soundtrack as a whole. Therefore, any published sound recording, even if pre-existing and subsequently incorporated into a soundtrack of a cinematographic work, is excluded from the definition of sound recording, and is thus excluded from the entitlement to equitable remuneration under section 19(1) of the Act, as long as the sound recording accompanies the cinematographic work.
The Supreme Court of Canada did not precisely define the circumstances in which a sound recording will be considered to accompany a cinematographic work. However, the SCC did clarify that if a pre-existing sound recording is extracted from a soundtrack accompanying a cinematographic work, then the sound recording regains the protection for sound recordings that do not accompany a cinematographic work. The SCC also referred to the legislative history of the relevant provisions, which included comments that a sound recording would attract equitable remuneration if the sound recording was played, performed, marketed, sold or exploited separately from the cinematographic work.
Re:Sound argued that because section 2 excludes a soundtrack that accompanies a cinematographic work, and not necessarily a soundtrack that accompanies a cinematographic work with the owner's consent, treating a pre-existing sound recording as a soundtrack excluded from the definition of sound recording would allow rights in a pre-existing sound recording to be extinguished without the owner's consent. However, the Copyright Board and the Federal Court of Appeal answered that argument with reference to section 17 of the Act, which extinguishes a performer's right to exercise a copyright in a performance only if the performer authorizes the embodiment of the performance in a cinematographic work, and the Supreme Court of Canada did not appear to depart from that reasoning.
This decision clarifies the rights of performers and makers of sound recordings embodied in cinematographic works. The performer and maker of a sound recording are entitled to compensation for authorizing the embodiment of their sound recording in a cinematographic work. They cannot seek additional equitable remuneration for the performance in public or communication to the public of the sound recording accompanying the cinematographic work.
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