Is Selling Pirated Pay-Per-View Cards an “Authorization” to Infringe Copyright? Federal Court Weighs In



ISSELLINGPIRATEDPAY-PER-VIEWCARDSAN“AUTHORIZATION”TOINFRINGE
COPYRIGHT?FEDERALCOURTWEIGHSIN

CatherineBergeronandFrederickPinto*
LEGERROBICRICHARD,Lawyers,
ROBIC,Patent&TrademarkAgents
CentreCDPCapital
1001Square-Victoria-BlocE–8
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Montreal,Quebec,CanadaH2Z2B7
Tel.(514)9876242-Fax(514)8457874
www.robic.ca-info@robic.com
ManycopyrightindustryleadersweremadenervouswhentheSupreme
CourtofCanadarendereditslandmarkTariff22[SocietyofComposers,
AuthorsandMusicPublishersofCanadav.CanadianAssociationofInternet
Providers,2004SCC45]decision,seriouslylimitingtheliabilityofinternet
serviceproviders(“ISP’s”)whoprovideend-userswiththetechnicalmeansto
violatecopyrightedmaterials,butdonot“authorize”it.Thatcase,alongwith
itsdecisioninCCHCanadian[CCHCanadianLtd.v.LawSocietyofUpper
Canada,2004SCC12],seemedtotightenthescopeof“authorization”to
violatecopyrightsomuchthatitseemeddoubtfulthehostofnew
technologiesthatenableinfringementofcopyrightedworkswouldqualify.A
recentFederalCourtdecisionshouldgosomewayincalmingthemdown.
InColumbiaPicturesIndustriesv.Frankl
[2004FC1454,renderedon2004-10-
21],theFederalCourtdecidedbywayofsummaryjudgmentthat
manufacturing,sellingandinstallingsatellitesystems(or“piratesmartcards”)
whichenabletheviewingof“pay-per-view”and“PayTV”broadcasts
constitutesan“authorizationtoreproduce,distributeand/orpubliclyperform
(…)copyrightedworks”
[atparagraph25].Thecourtwassoconvincedof
theviolationthatitconsideredtherewas,initsopinion“nogenuineissuefor
trialinrelationtocopyrightinfringementundertheCopyrightAct”.
ThecaseinvolvesThomasFrankl,anindividualoperatingoutofhishomein
themanufacturing,saleandinstalmentofpiratesmartcards,designedto
receiveillegallydecodedversionsofthevarious“securedbroadcastsignals”
emittedbytheplaintiffs.Thedecodingitselfisinitiallydonebyillegal



















































©LEGERROBICRICHARD,2004.*Lawyer,CatherineBergeronisamemberofthelawfirmLEGERROBICRICHARD,g.p.andof
thepatentandtrademarkagencyfirmROBIC,g.p.;FrederickPintoisarticlingwiththese
firms.PublishedinWorldCopyrightLawReport.TheauthorswouldliketothankFabrice
Maureauforhiscontributiontothisarticle.Publication328.006.



Americanbroadcasters,withoutauthorizationfromthecopyrightholdersnor
aC.R.T.C.[TheCanadianRadio-televisionandTelecommunications
Commission
]licensetobroadcastinCanada.Individualscangainaccessto
thedecodedsignalsbyusingthesmartcards,withoutanyfurtherclearance
bythecopyrightowners.
Mr.FranklwascaughtbytheR.C.M.P.[TheRoyalCanadianMountedPolice]
with51piratecardsaswellasothermaterialusedinthemanufacturingand
instalmentofthecards,andpleadedguiltytofivechargesunderCanada’s
RadiocommunicationAct.
Butinordertodeterminewhetherthedefendanthadalsobreachedthe
plaintiffs’copyrightsinthebroadcasts,thejudgehadtoascertainwhether
hisactionsweretantamountto“authorizing”copyrightinfringementsbythe
eventualusersofthecards.
Themeaningoftheword“toauthorize”inthecontextofcopyright
infringementwassummarizedbytheSupremeCourtinCCHCanadian.
Paragraph38ofthatdecision,whichisreproducedintegrallybyjustice
Tremblay-Lamerandrepresentstheonlysubstantiveevaluationoftheissue,
statesthat“authorizemeansto“sanction,approveandcountenance”(…)
Countenanceinthecontextofauthorizingcopyrightinfringementmustbe
understoodinitsstrongestdictionarymeaning,namelyto“giveapprovalto;
sanction,permit,favour,encourage””.JusticeTremblay-Lamerprofessedno
difficultiesinapplyingthatstandardtothepracticesofthedefendant,which
constituted“enablingtheunauthorizedreceiptandclearviewingofthe
SecuredBroadcastSignals,contrarytotheplaintiffs’rightsinthecopyrighted
works”[atparagraph27].Evenifthedefendantwassomewhatofalame
duckintheaction-notevenbotheringtohirelegalrepresentationand
failingtooffereventhemostbasiccontradictiontotheaffidavitevidence
presentedbytheplaintiffs–theFrankldecisionunderscoresseveralimportant
nuancestobemadewithrespecttoTariff22’sandCCH’sreal
consequencesindeterminingtheauthorizationcriterion.
Inbothdecisions,theSupremeCourtstressedthatapersondoesnot
authorizeinfringementbysimplyproviding“themereuseofequipment”that
couldbeusedtoinfringecopyright.UnlikeISP’sorphotocopyingmachines,
however,piratecardsarenotneutraltechnology.Rather,theyexploit
technologyspecificallydesignedtocapturecontentdecodeduniquelyto
circumventcopyrightregulation.Secondly,theCourthadnotedthatISP’s
andlibrariesonlyhaveanincomplete,imputedknowledgethataperson
“might”infringecopyrightusingthetechnology.Inthecaseofthepirate
cards,amanufacturerandsellerhasactualknowledgethattheuserwill
infringecopyright.Whatothermotivecouldtherebeforthetransaction,in



thefirstplace,otherthantheviolationofcopyrightrestrictionson
broadcasts?Andfinally,Franklhintsthatthegoodfaithpresumptioncourts
generallyafforddefendantsinsuchactionscanalwaysberebutted.Unlike
ownersofneutraltechnologies,whosemainactivitiesconsistoflegitimate
uses,makersandsellersoftechnologieswhosesolepurposeistoescapethe
ambitofthelawdonothavecleanhands.Itisthereforemoredifficultfor
defendantslikeFrankltobenefitfromthesamepresumptionthanthe
defendantsintheTariff22andCCHCanadiandecisions.
WhilenotexplicitlydealtwithbyjusticeTremblay-Lamerinthisaffair,these
keydifferencesbetweentheSupremeCourt’srecentdecisionsandthe
Franklcasegiveussomeinsightonhowthemeaningof“toauthorize”could
bedeployedinfuturecases.

TheFranklcaseisalsosignificantforanotherreason.Thefactthatmanyof
thebiggestnamesintheentertainmentindustryteamedup[thelistof
plaintiffshereincludedDisney,MGMStudios,Paramount,Tristar,20
thCentury
Fox,UniversalStudiosandWarnerBros]toprosecuteanindividualworking
outofhishomewitharelativelymodestscopeofoperationsshowstheir
seriousnessinprosecutingsuchissuesaggressively.Andifthiscaseisany
indication–anddespitethecaveatscreatedbytheSupremeCourt-they
candososuccessfully.



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