Movie studio Voltage Pictures has targeted alleged movie pirates in court for well over a decade.
The company and its subsidiaries filed numerous lawsuits against internet subscribers in the United States, Australia, and Europe, using various strategies.
In Canada, Voltage and other film companies attempted to target a large group of copyright infringers through a reverse class-action lawsuit, which is relatively rare. The movie company argued that this is a cheaper way to target large numbers of infringers at once.
The lawsuit in question, filed in 2016, revolves around a representative defendant, Robert Salna, who provides WiFi services to his tenants. Through Mr. Salna, Voltage hoped to catch a larger group of infringers.
The case garnered the interest of the Canadian Internet Policy and Public Interest Clinic (CIPPIC) which intervened in the Federal Court proceeding to represent anonymous defendants. The intervention was a success and the Federal Court dismissed the class action attempt in 2019.
Filmmakers Don’t Give Up
While the filmmakers lost their first battle in court, that was just the beginning. The case went through a series of appeals and cross-appeals, and Voltage also petitioned the Supreme Court to take on the matter.
Last year, the Federal Court of Appeal in Toronto took on what now appears to be the final proceeding. The filmmakers hoped to overturn an earlier dismissal by the Federal Court.
One of the contested issues relates to how the class action defendants are notified. Voltage argued that this could be done through the piracy notices ISPs are required to forward under subsection 41.25(2) of Canada’s Copyright Act.
The filmmakers hoped to utilize Canada’s notice-and-notice regime to reach out to proposed defendants. Under their proposal, a hyperlink to contact the rightsholder’s attorney would be added to the notices.
Overall, Voltage argued that the reverse class action approach is doable and should be certified.
Federal Court of Appeal Rejects Reverse Class Action
After hearing both sides, Justices Gleason, Goyette, and Biringer disagreed with Voltage. In their decision issued on July 16, they conclude that the proposed class action is not permitted under the Copyright Act.
More fundamentally, they ruled that a reverse class action is not the preferred procedure for these types of cases, leading to the dismissal of the case in its entirety.
Citing Supreme Court jurisprudence, the Court of Appeal concluded that, to identify alleged copyright infringers, these types of lawsuits should use Norwich orders, not the notice-and-notice system.
“The Supreme Court of Canada […] noted that a copyright owner who wishes to sue a person alleged to have infringed copyright online must proceed by way of a Norwich order to obtain details about them and cannot use the notice-and-notice regime in the Copyright Act for this purpose,” Justice Mary Gleason concludes.
The federal court previously ruled that Voltage’s proposed use of the “notice-and-notice” regime is not permitted. The Copyright Act specifically states that these notices can’t be used to offer settlements, demand payments, or to request personal information.
Similar to piracy warnings that ISPs forward in other countries, the notices are mainly aimed to act as a deterrent.
“In short, the context of the notice-and-notice regime demonstrates an intention to limit the involvement of ISPs to the initial delivery of a notice aimed at deterrence,” the Court of Appeal verdict reads.
“This context does not suggest that a copyright owner who wishes to pursue enforcement against the suspected infringer could use the notice-and-notice regime as a litigation tool,” the order adds.
IP Address Is Not Sufficient
The verdict also cites jurisprudence holding that an IP address alone is not sufficient to establish copyright infringement. It also requires proof that the defendant authorized or controlled the alleged infringements, instead of merely being the listed subscriber connected to an IP address.
This is a critical finding when it comes to the class action approach where all defendants are treated similarly, as these nuances may differ greatly from person to person.
“I cannot see how there is any basis in fact to conclude that the proposed class proceeding is preferable to individual actions because the individual issues in this case swamp whatever common issues there might be,” Justice Gleason writes.
Case Closed, Costs Owed
The Federal Court of Appeal denied the appeal brought by Voltage Pictures and the other film studios therefore the Federal Court’s decision to deny certification of the proposed reverse class stands.
Crucially, the Court issued the dismissal without leave to reapply, permanently ending the legal battle. In doing so, the Court of Appeal effectively closed the door on the strategy being used in mass copyright lawsuits against individuals in Canada.
This doesn’t mean that BitTorrent users can no longer be sued, but reverse class action lawsuits of this type appear off-limits.
In addition to ending this long-running lawsuit, the court also upheld the Federal Court’s decision to award Mr. Salna CAD$50,710 in costs for the previous proceedings, noting that this was warranted by the “exceptional circumstances” and novel issues in the case. The film companies must also pay Mr. Salna’s appeal costs.
All in all, this final decision is a clear victory for Robert Salna and the thousands of people who could’ve been targeted through this and future cases.
From: TF, for the latest news on copyright battles, piracy and more.
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