The question before the Supreme Court in Canadian Broadcasting Corp v SODRAC, 2015 SCC 57 was whether SODRAC could seek a licence for copies of copyright protected works that were made by CBC for internal use to facilitate broadcasting – such copies are known as “broadcast-incidental” copies. CBC possessed a “synchronization” licence, which allowed it to incorporate musical works into production copies of programs. CBC argued that, implicit in this licence, was a licence to make broadcast-incidental copies. CBC also argued that broadcast-incidental copies are not actually reproductions as per the Copyright Act.
Writing for the Majority, Justice Rothstein agreed with SODRAC and found that broadcast-incidental copying, even if resulting in merely ephemeral copies, engages a copyright owner’s reproduction right. Further, a licence to make such copies should not be implied from a synchronization licence as each licence covers a fundamentally distinct activity, production and broadcasting. Justice Rothstein also cited sections of the Act, which provide narrow instances where broadcast-incidental copying is not considered an infringement of copyright. These sections were held as strong evidence that Parliament intended, at least as a baseline, that broadcast-incidental copies were indeed reproductions.
Justice Rothstein remitted the issue of the valuation of the licence for broadcast-incidental copies to the Copyright Board. In doing so, he noted that it was in its valuation that the Board failed to take into account certain fundamental principles underpinning the Copyright Act, such as technological neutrality and the required balance between the rights of users and the rights of copyright-holders.
In a strongly worded dissent, Justice Abella held that broadcast-incidental copies go to the core of broadcasting: a broadcast-incidental copy is not a separate reproduction as its sole purpose is to effect the broadcast. In fact, CBC was required to make broadcast-incidental copies to comply with CRTC regulations. As such, these copies should not attract separate licence royalties to SODRAC. According to Justice Abella, the Majority employed too literal an approach to interpreting the Act that left no room for the principle of technological neutrality. The principle of technological neutrality requires a focus on the character of the activity and not on how the activity is achieved technically – SODRAC should not be allowed to claim copyright over a method of broadcasting. Further, Justice Abella noted that SODRAC only held rights to royalties for reproductions and was not entitled to receive royalties on broadcasting, such royalties being payable to SOCAN.