In an important decision released Friday, the Federal Court of Canada issued the first Canadian site blocking order against sites that predominantly facilitate copyright infringement. The order made by Justice Gleeson, in a carefully reasoned decision in Bell Media Inc. et al v GOLDTV.BIZ 2019 FC 1432, ordered certain ISPs in Canada to block access to pirate subscription streaming sites (GoldTV.biz and GoldTV.ca) that were infringing the copyrights of the plaintiffs Bell Media Inc., Groupe TVA Inc, and Rogers Media Inc.
The order was granted following two prior injunction orders which were not effective against the anonymous site operators to stop the unauthorized subscription services of the plaintiffs’ programming over the Internet. The injunction was opposed by Teksavvy but was unopposed by the other ISPs, Eastlink, TELUS, Distributel (except with respect a term in the order), Cogeco, Fido, Videotron, Bell Canada, and Rogers Communications.
The Court made a number of important holdings in deciding that the site blocking order should be granted.
Did the Court have jurisdiction to issue a site-blocking order?
The Court had little difficulty in concluding that it had the jurisdiction under sections 4 and 44 of the Federal Courts Act to grant the injunction pursuant to its equitable powers to grant injunctions where “just and convenient”. This broad jurisdiction has been used in the UK to grant site blocking orders. The leading UK case which authoritatively established the jurisdiction was Court of Appeal decision in Cartier International AG v. British Sky Broadcasting Ltd.,  EWCA Civ 658 (“Cartier CA”). This equitable jurisdiction was confirmed by the UKSC in Cartier International AG v. British Telecommunications plc,  UKSC 28 (“Cartier UKSC”). In Google Inc. v. Equustek Solutions Inc., 2017 SCC 34, the Supreme Court of Canada also used this jurisdiction to grant a world-wide de-indexing order against the non-party respondent Google. On this basis there could be little doubt about the Court’s jurisdiction to make a site blocking order.
Should the Court decline to exercise its jurisdiction?
The Court also considered whether there were any reasons not to exercise its jurisdiction to make the order.
Teksavvy had argued that the remedies under the Copyright Act are exhaustive and do not include site-blocking orders. This was not accepted by the Court in view of the broad wording in s.34(1) of the Act which “includes the right to seek relief against a non-party in circumstances where that non-party facilitates, albeit innocently, the harm being complained of (Equustek at para 31).” The Court also held that Parliament’s decision not to include an express site blocking regime as part of the Copyright Modernization Act, such as the ones that exist in Australia and Singapore, did “not equate to Parliament prohibiting this Court from exercising its equitable jurisdiction to issue a site-blocking order.” The breadth of s.34 was also inconsistent with any such assertion.
The Court also considered whether s.36 of the Telecommunications Act and the decisions and policy documents of the CRTC were reasons not to make an order. The Court held they were not. First, because, as the CRTC had held in Telecom Decision CRTC 2018-384 (Fairplay) as “section 36 confers authorizing power and not a mandatory power, the power to mandate blocking must be found elsewhere and must relate to the subject matter that is clearly within the Commission’s jurisdiction under the Telecommunications Act”. Second, the Court accepted the CRTC opinion that “Parliament intended the Copyright Act to be an exhaustive regime” and absent “clear statutory language to the contrary, where the essential character of the dispute is one of copyright, remedies are to be found in the Copyright Act”.
The Court also considered whether an ISP could comply with a blocking order without prior approval of the CRTC. The Court held it could. Relying on the Supreme Court of Canada decision in Reference re Broadcasting Act, 2012 SCC 4, the Court stated that s.36 of the “Telecommunications Act cannot be interpreted or applied in a manner that would allow the CRTC to interfere with an order of the Court aimed at impeding further infringement of rights under the Copyright Act”.
What is the test to be applied in deciding whether to make a site blocking order and why the site blocking order was granted
The Court gave lengthy reasons for deciding to grant the site blocking order. In this regard, the Court found that the plaintiffs had established a strong prima facie case on the merits that the operators of the pirate subscription streaming service infringed the copyrights of the plaintiffs. It also found that the plaintiffs satisfied the two other requirements, namely, irreparable harm if the injunction was not granted and that the balance of convenience was in their favour.
To obtain the injunction, the plaintiffs established they would suffer irreparable harm if the injunction was not granted. The two prior injunctions against the defendants (an interim and an interlocutory injunction) had not been effective to terminate the infringements. (They invariably are not against foreign rogue operators, which is why site blocking orders are needed.) Further, the Court found, as have other courts around the world, that site blocking would be effective while other measures would not be. The losses from the piracy were also not readily quantifiable or compensable.
Teksavvy argued that the plaintiffs could not demonstrate irreparable harm because the infringing activity is minimal relative to the Plaintiffs’ overall financial success. This “sky is rising” argument (which ignores what revenues would be earned in the absence of piracy and with effective anti-piracy laws such as site blocking) was rejected by the Court saying it did “not render the harm irrelevant or of no consequence”. The Court also quoted from the findings of the CRTC in the Fairplay decision where the CRTC found that the record before it “demonstrates that there is evidence that copyright piracy results in harm to the Canadian broadcasting system”. The Court stated that this “indicates that in addition to the ongoing rights infringement, the actions of the Defendants are harmful to the Plaintiffs as participants in that system.”
Balance of Convenience and proportionality
The Court also found that the balance of convenience favoured granting the injunction. As the order targeted ISPs, innocent third parties, the Court also canvassed whether the order was proportionate and appropriately balanced the interests of the site operator defendants, the ISPs, and the public. It found that it was.
Courts in the UK (and elsewhere in the European Union) have had considerable experience in making site blocking orders. As a result they have developed factors to assist in assessing the balance of convenience and in determining what is just and equitable in considering the legitimate but sometimes conflicting interests of copyright holders, operators of pirate sites, ISPs, and the broader public.
In Cartier CA the UK Court of Appeal endorsed a number of principles or factors as being relevant in determining if a site-blocking order is proportional. The Court summarized these factors as follows:
- Necessity — a consideration of the extent to which the relief is necessary to protect the plaintiff’s rights. The relief need not be indispensable but the court may consider whether alternative and less onerous measures are available;
- Effectiveness — a consideration of whether the relief sought will make infringing activities more difficult to achieve and discourage Internet users from accessing the infringing service;
- Dissuasiveness — a consideration of whether others not currently accessing the infringing service will be dissuaded from doing so;
- Complexity and Cost — a consideration of the complexity and cost of implementing the relief sought;
- Barriers to legitimate use or trade — a consideration of whether the relief will create barriers to legitimate use by unduly affecting the ability of users of ISP services to access information lawfully;
- Fairness — a consideration of whether the relief strikes a fair balance between fundamental rights of the parties, the third parties and the general public;
- Substitution — a consideration of the extent to which blocked websites may be replaced or substituted and whether a blocked website may be substituted for another infringing website; and
- Safeguards — a consideration of whether the relief sought includes measures that safeguard against abuse.
The Court found the factors of assistance in determining whether the injunction should be granted in this case. (The necessity factor was considered in assessing irreparable harm).
Effectiveness, Dissuasiveness, and Substitution
The Court had no difficulty in finding that the order sought would be effective, would render the infringing activity more difficult, and would discourage and dissuade access to the infringing services.
The evidence does demonstrate that site-blocking orders have proven effective in other jurisdictions and that the Third Party Respondents’ subscribership represents a significant percentage of ISP subscribers in Canada. Therefore, I am satisfied that the order sought is likely to reduce overall access to the infringing services and is an effective means of protecting the Plaintiffs’ rights and limiting harm….
I am not convinced that additional costs and complexity [of using VPNs and other circumvention methods] can simply be overlooked or discounted on the basis that not all potential future users of the infringing services will be dissuaded by these considerations. In jurisdictions where site-blocking measures have been authorized the Courts have recognized that even minimal increases in costs may have a dissuasive or deterrent effect (Twentieth Century Fox Film Corp. v British Telecommunications PLC  EWHC 1981(Ch) at para 196).
The substitution factor requires consideration of whether the blocked websites may be replaced or substituted by another infringing website. While this was a possibility, the Court held on the evidence it would not occur.
Complexity, Cost, Safeguards
The site blocking order requires the ISPs to engage in DNS blocking and IP address blocking. The order specified the means that could be used for blocking domains included DNS blocking, or alternatively DNS re-routing. For domains, subdomains or specific paths identified in the order, DNS blocking or DNS re-routing, or at the ISPs’ election URL path blocking could be used, to the extent that the ISPs existing technical infrastructure allows this blocking method. (The order made it clear that ISPs did not need to use URL path blocking.)
The Court found that the ISPs had the technical capability to engage in DNS blocking and IP address blocking. There was also no evidence that any of the ISPs would have to acquire any hardware or software in order to comply with the order. The order also required the plaintiffs to indemnify and save harmless the ISPs for their reasonable marginal cost of implementing the order and against any reasonably incurred losses or labilities resulting from a third party complaint or action as a result of their compliance with the order. As a result, the Court found that the cost or complexity of the proposed order did not weigh against its issuance.
As the order contained a series of measures to safeguard the varying interests engaged from abuse or misuse of the order, the Court also found this factor weighed in favour of granting the order.
Barriers to legitimate trade
Consistent with decisions in other jurisdictions which have held that the risks of over blocking are low and can be managed with procedural protections, the Court determined that proposed order would not unduly prevent ISPs customers from accessing lawful content. The Court gave the following reasons:
The order is limited to those domains, subdomains and IP addresses identified in the draft order. It has not been disputed that the sole or predominant purpose of the identified domains, subdomains and IP addresses is to enable or facilitate access to the GoldTV Services;
Although the order makes provision for the addition of domains, subdomains or IP addresses this can only occur after notice to the Court and the filing of evidence to establish the sole or predominant purpose of the newly identified domains or addresses;
The order also makes provision for removal of a domain or IP address where the “sole or predominant purpose” criteria are no longer satisfied; and
The order provides for the temporary lifting of the site blocking by the Third Party Respondents to allow them to respond to technical or security concerns or to avoid over-blocking.
Fairness (net neutrality and freedom of expression)
Under this factor, the Court considered whether the principle of net neutrality and users’ freedoms of expression rights should weigh against granting the site blocking order.
Jurisdictions around the world including throughout the EU which have enshrined net neutrality in their laws have made site blocking orders in numerous circumstances. They do so because the principle of net neutrality is generally understood not to apply to taking steps to address illegal materials, particularly where a Court has made an order that illegal content should be blocked (or taken down). For example, the European Union recognizes that net neutrality rules do not prevent courts or government agencies from ordering the removal or blocking of illegal content from the Internet. Given the now clearly recognized threats posed by illegal online content, this understanding of the proper role of net neutrality is even more critical to protecting the public.
Many courts around the world with strong commitments to freedom of speech (including those which have constitutional protections for this important right) have recognized that blocking websites whose predominant purpose is to faciliate infringement does not violate rights to freedom of speech. The courts have held that operators of sites whose content is predominantly infringing or who operate sites predominantly to facilitate infringement have no greater rights than those who engage in offline infringing activities.
The Court after considering both these important questions ruled that neither the principles of net neutrality nor freedom of speech was a reason not to make the order.
I am not prepared to conclude, as the Plaintiffs have suggested, that the principle of net neutrality is of no application where a site-blocking order is sought. However, I am satisfied, in the face of a strong prima facie case of ongoing infringement and a draft order that seeks to limit blocking to unlawful sites and incorporates processes to address inadvertent over-blocking that neither net neutrality nor freedom of expression concerns tip the balance against granting the relief sought. As has been previously noted by the Supreme Court of Canada, albeit in a different context, the jurisprudence has not, to date, accepted that freedom of expression requires the facilitation of unlawful conduct (Equustek at para 48). Similarly I am not convinced that the principle of net neutrality, or the common carrier doctrine, is to be applied in a manner that requires ISPs to facilitate unlawful conduct.
After considering all of the Cartier factors, the Court found that the balance of convenience weighed in favour of granting the blocking order.
A few concluding remarks
As a result of the decision, Canada now joins the many countries around the world which use judicial and/or administrative site blocking against sites that predominantly facilitate copyright infringement. Site blocking is available, for example, in EU/EEA member states (Austria, Belgium, Denmark, Finland, France, Germany, Greece, Iceland, Ireland, Italy, Norway, Portugal, Sweden, Spain, UK, and the legal basis also exists in the other member states of the European Union based on Article 8(3) of the Infosoc Directive), South America/Latin America (Mexico, Argentina), and Eurasia and Australasia (Australia, India, Indonesia, Malaysia, Russia, Turkey, Singapore, South Korea, Thailand).
The decision of Justice Gleeson to make the site blocking order was a carefully reasoned one. He considered the evidence and the arguments for and against site blocking orders and decided there was both the jurisdiction to make the order and that it was just and convenient that it should be made. Like courts around the world he found that a site blocking order would be effective and dissuasive, could be implemented by ISPs using reasonable and available measures, and would not result in the violation of rights of freedom of speech or net neutrality.
The decision comes less than a week after the decision in Voltage Pictures, LLC v Salna  FC 1412 in which the Federal Court rejected a motion to certify a reverse class action against individuals engaging in online P2P file sharing using the BiTorrent protocol. While individuals who use infringing sites and services may themselves be infringers (such as by making infringing reproductions, making works available to the public, or authorizing infringing acts), remedies that target the wealth destroyers – those that facilitate infringements on a mass scale – such as site blocking orders are much more effective in reducing infringements and in providing legal frameworks that support legitimate services.
This article was first published on barrysookman.com.