Publications Survey of Intellectual Property Law: Part V: Copyright and Industrial Designs, (1987-1999) 31 Ottawa Law Review 93, by Gregory C. Ludlow and Mark A. LeBlanc(1).

This Survey appears in several parts and canvasses significant developments in intellectual property law in Canada from January 1, 1987. This Part V explores developments in the law relating to Copyright and Industrial Designs and completes this Survey. Part I of this Survey addressed the then numerous legislative activities regarding intellectual property law. Part II canvassed significant developments in the law of trade-marks regarding the statutory rights of registrations, especially the suitability of applications and the validity of registration. Part III completed the survey of the law of trade-marks by addressing the enforcement of trade-mark rights, especially the tort of passing off and the statutory rights of action. Part IV focussed on significant developments in the law relating to Patents. In particular, it addressed the topics of validity and infringement (including remedies), as well as ownership and the matter of patented medicines.

Cette recension, publiéée en diverses parties, offre un éclairage sur les progrès importants dans le domaine du droit de la propriété intellectuelle depuis le 1er janvier 1987. La partie V ci-dessous, qui vient compléter cette étude, est consacrée au droit d'auteur et au dessin industriel. La Partie I faisait le survol des nombreuses modifications législatives en matière du droit de la propriété intellectuelle. La Partie II avait pour sujet les marques de commerce et passait en revue les développements importants en ce qui a trait aux droits d'enregistrement prévus par la loi, à la pertinence des demandes et à la validité de l'enregistrement. La Partie III poursuivait l'analyse du droit relatif aux marques de commerce en examinant la question de la mise en application des marques de commerce et, plus particulièrement, le délit de substitution ainsi que les droits d'action prévus par la loi. La Partie IV traçait les progrès importants en matière du droit des brevets, entre autres, en ce qui a trait à la validité des brevets, aux infractions en matière de brevets (y compris les réparations), au droit de propriété et à la sphère des médicaments brevetés.

© 2000 Gregory C. Ludlow and Mark LeBlanc All rights reserved

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Table of Contents

1. Introduction 97

2. Copyright 97

   1. Amendments to the Copyright Act 97
      1. Neighbouring Rights 98
         1. Performers 98
         2. Makers of Sound Recordings 99
         3. Broadcasters 99
         4. Reciprocity 99
      2. Blank Tape Levy 100
      3. Rights Granted to Book Distributors 101
      4. Exceptions 101
         1. Fair Dealing 101
         2. Educational Institutions 102
         3. Libraries, Archives and Museums 102
         4. Photocopiers in Libraries, Archives and Museums 103
         5. Archives 103
         6. Ephemeral Recordings 103
         7. Perceptual Disabilities 104
      5. Statutory Damages and Summary Judgment 104
         1. Statutory Damages 104
         2. Summary Proceedings 105
         3. Expanded Scope of Injunctions 105
      6. Collective Administration of Copyright 105
      7. Miscellaneous Other Changes 106
      8. Conclusions 106

   2. WIPO Treaties - Imminent Change 106
      1. Background 106
      2. Implementation of the WIPO Copyright 108
      3. Implementation of the WIPO Performances and Phonograms Treaty 110
      4. Government Action 112
      5. Conclusions 112

   3. Subject Matter 113
      1. Artistic Works 113
      2. Architectural Works 116
      3. Dramatic Works 117
      4. Literary 118

   4. Originality 121
      1. General 121
      2. Compilations 122
      3. Skill & Labour 126

   5. Registration 127

   6. Infringement 128
      1. Presumption of Ownership 128
      2. Copying 129
      3. Substantial Taking 130
      4. Indirect Infringement 137
      5. Defences 140
         1. Innocent Infringement 140
         2. Permitted Dealing 142
      6. Remedies 147
         1. Compensation 147
         2. Individual Liability 149

   7. Ownership 150
      1. General 150
      2. Assignment 152

   8. Licenses 153
      1. Copyright Board 153
      2. Licensing 158
         1. Implicit 159

   9. Moral Rights 160

3. Industrial Designs 162

   1. Subject Matter 162
   2. Marking 162
   3. Ownership 163

4. Conclusion 164

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[ pg. 97 ]

I. Introduction

This survey reports and comments upon significant legislative activity and jurisprudence in the field of law regarding copyright and industrial designs during the period from the beginning of 1987 to October 31, 1999.

The legislative activity commented upon includes Bill C-32 commonly known as "phase two" which addressed six areas of significant change namely (1) neighbouring rights, (2) a levy on blank tapes, (3) stronger rights for book distributors with exclusive rights, (4) new exceptions, (5) statutory damages and summary applications, and (6) provisions to accommodate the collective administration of the new rights.

In addition, the legislative activity comment also focuses on imminent legislative change arising from Canada's adherence to two new treaties regarding copyright, and neighbouring rights in the digital environment.

The commentary on copyright jurisprudence covers what the writers regard as the most significant developments in Canada in respect of the topics of subject matter, originality, ownership, infringement, licenses, and moral rights, continuing from the last survey published in 1987.(2)

The commentary on industrial designs covers the same time frame and reports on significant jurisprudence in respect of the topics of suitable subject matter, marking, and ownership, again continuing from the last survey published in 1987.(3)

[ pg. 97 ]

II. Copyright

A. Amendments to the Copyright Act

Bill C-32, An Act To Amend the Copyright Act,(4) or "phase two" as it has become known, was passed into law on April 25, 1997. Its coming into force completed the process of copyright reform begun with phase one, which came into force on June 8, 1988. With no previous thorough revision to the Copyright Act since January 1, 1924, despite the many significant and far reaching technological advancements affecting creators and their works throughout that time period, it was intended that the Act was to be thoroughly revised in two stages to accommodate past and future technological changes.

Phase one was intended to cover the urgent and important revisions which were not seen as controversial, namely improved criminal sanctions, a moral rights protection regime, recognition of computer programs as literary works, and provisions to encourage the creation and operation of copyright collectives. Phase two, intended to follow immediately on the heels of phase one, was to address the equally important yet apparently more controversial balancing of authors' and users' rights by providing for increased exemptions to copyright infringement. The perception of the balancing of authors' and users' rights as controversial was accurate as it took almost nine years, with active lobbying on behalf of both authors and users, to finally cobble together a Bill and pass it through Parliament. Phase two amendments have come into force at various times since having received royal assent on April 27, 1999, with all remaining amendments having come into force on October 1, 1999.

Bill C-32 addressed six areas of significant change: (1) neighbouring rights; (2) a levy on blank tapes; (3) stronger rights for book distributors with exclusive rights; (4) new exceptions; (5) statutory damages and summary applications; and (6) provisions to accommodate the collective administration of the new rights.

[ pg. 98 ]

1. Neighbouring Rights

Neighbouring rights, or those rights said to be 'neighbouring' on copyright, refers to the rights and protection granted to performers, producers of sound recordings, and broadcasters. With legislation recognizing these rights, Canada now comes into line with the 1971 version of the Berne Convention and the 1961 Rome Convention on the Protection of Performers, Producers of Phonograms, and Broadcasting Organization. It is worth noting that the U.S. remains opposed to the recognition of these neighbouring rights.

(a) Performers

Performers will now have the following rights: (A) if their performance is not fixed, they will have the exclusive right to: (1) communicate it to the public by telecommunication; (2) perform it in public, where it is communicated to the public by telecommunication or otherwise by communication signal; and (3) fix it in any material form; or (B) if their performance is fixed, they will have the exclusive right to: (1) reproduce any fixation that was made without authorization; and (2) where the fixation was authorized, to reproduce any fixation that was made for a purpose other than for which the authorization was granted. Where the performance is fixed in a sound recording, the performer also has the exclusive right to rent out the sound recording; or (C) to rent out a sound recording of their performance.(5) Most importantly, the performer now has a right to be paid equitable remuneration for the performance in public or its communication to the public by telecommunication, except for any retransmission.(6) This essentially puts performers on a similar footing as composers, lyricists and music publishers (except these persons are remunerated for retransmissions) and permits them to have a collective, similar to SOCAN, and to collect and distribute royalties as set by the Copyright Board. The split between performers and record companies is fixed at 50:50.(7)

In order for performers to protect their exclusive rights of transmission, fixation, reproduction and renting, the performance must: (1) take place in Canada or a Rome Convention country; (2) be fixed in a sound recording made by a Canadian or a citizen or permanent resident of a Rome Convention country, or if by a corporation, one with its headquarters in such a country; (3) be fixed in a sound recording first published in Canada or a Rome Convention country; or (4) be transmitted at the time of performance from Canada or a Rome Convention country by a broadcaster who has its headquarters in the country of broadcast.(8) To protect their right to equitable remuneration, the sound recording must: (1) be made by a record company who was at first fixation a Canadian or a citizen or permanent resident of a Rome Convention country, or if a corporation, one with its headquarters in such a country; or (2) be fixed (i.e. recorded) in Canada or a Rome Convention country.(9)

[ pg. 99 ]

(b) Makers of Sound Recordings

Makers of sound recordings (record companies) now have the sole right in respect of their sound recordings to: (1) publish it for the first time; (2) reproduce it in any material form; and (3) rent it out.(10) Record companies are granted the same right to equitable remuneration as performers.(11) The annual royalty to be paid by broadcasters is $100 on the first $1.25 million of annual advertising revenues, and thereafter according to the established tariff set by the Copyright Board.(12) There is a three-year transitional period for phasing in one-third of the royalties each year.

For record companies to protect their rights of publication, reproduction and renting, the sound recording must: (1) be made by a Canadian or a citizen or permanent resident of a Berne or Rome Convention or WTO Member country, or if a corporation, one with its headquarters in such a country at the time of recording.(13) The same requirements exist to protect record company rights of remuneration as exist for performers.(14)

(c) Broadcasters

Phase two granted broadcasters the exclusive rights in respect of their communication signal to: (1) fix it; (2) reproduce any unauthorized fixation of it; (3) authorize other broadcasters to simulcast it; and (4) in the case of a television signal, perform it in public where an entrance fee is charged.(15) These rights can only be protected where the broadcaster, at the time of broadcast, had its headquarters in Canada or in a Rome Convention or WTO Member country, and broadcasts the signal from that country.(16)

(d) Reciprocity

Phase two has created a mechanism whereby neighbouring rights may be extended to nationals of countries not signatories to the Rome Convention (including the U.S.) provided that the non-signatory country has provided reciprocal treatment to Canadian performers, record companies and broadcasters.(17) Where reciprocal treatment is only provided in part, the benefits of the neighbouring rights may be extended in part accordingly.(18) Furthermore, on request of a NAFTA country (U.S. or Mexico), Canada may extend the right to remuneration for neighbouring rights to U.S. and Mexican performers and makers of sound recordings for dramatic or literary works (but not musical works).(19)

[ pg. 100 ]

2. Blank Tape Levy

Responding to the cry of the music industry, that record sales have been steadily declining since the advent of the cassette tape, due to its use for unauthorized recordings made for private use, and following the lead of many European and other countries, phase two has established a blank tape levy to compensate copyright owners for unauthorized copies of musical works. The copying of commercially recorded music for private use no longer infringes the copyright in the musical work, the performer's performance or the sound recording.(20) The exception is limited to musical works (it excludes literary or dramatic works), but covers a recording on any "audio recording medium" (unlike in the U.S., where only recordings in digital format are covered). Some authors commenting on the Bill shortly after its passage, have stated that computer discs would be excluded, as the definition of "audio recording medium" requires that the recording medium be "of a kind ordinarily used by individual consumers for [the purpose of making a sound recording]".(21) However, with the more recent advent of computer technologies for the recording and playback of music off of the Internet from computer discs, this would no longer appear to be the case.

As compensation for the permissible recording for private use, authors of musical works, performers, and record companies are now entitled to share in the revenues generated by payments from monies paid by the makers and importers of blank audio tapes.(22) The levy to be paid by the makers and importers of blank audio tapes is to be set by the Copyright Board, who may establish a collective to administer the collection and distribution of the levies. Associations representing persons with perceptual disabilities are excluded from having to pay the levy.

In order to receive remuneration, authors, performers and record companies must be eligible. Authors are eligible if copyright subsists in the musical work in Canada and they are a Canadian or a citizen or permanent resident of a Berne Convention, UCC or WTO Member country. Performers and record companies are eligible if copyright subsists in the performers' performance or the sound recording, as applicable in Canada, and they are a Canadian or a citizen of a country receiving reciprocal treatment under s. 85, or if a corporation, one with its headquarters in such a country.(23) Performers and record companies who are nationals of other countries are provided reciprocity for blank tape levies under a scheme substantially similar to that provided to them for neighbouring rights.(24)

[ pg. 101 ]

3. Rights Granted To Book Distributors

Book distributors with written exclusive distribution agreements (in addition to copyright owners and their exclusive licensees) may assert copyright infringement against gray marketers or parallel importers Ð those that have imported copies of the books with the consent of the copyright owner in the country where the books were printed, but without the consent of the Canadian copyright holder.(25) The provision applies only to books or a part thereof and excludes pamphlets, periodicals, maps, sheet music, and instruction or repair manuals accompanying a product or service.(26) An exclusive distributor is a person appointed in writing by the owner or exclusive licensee of the copyright in Canada as the only distributor in Canada or any part thereof or any particular sector of the market thereof.(27)

In order for the copyright owner, exclusive licensee, or exclusive distributor to obtain the usual injunction and damages remedies, notice of the existence of an exclusive distributor must have been given to the alleged parallel importer prior to the infringement.(28) As well, provided they have served the Department of National Revenue with notice in writing that the Canadian copyright owner does not want the parallel copies imported, the copyright owner, exclusive licensee or exclusive distributor may enlist the aid of Customs to restrict the importation of such copies into Canada.(29)

However, exceptions exist. Notwithstanding these rights, it is lawful for a person to import: (1) up to two copies of a book for personal use; (2) any number of copies of a book for use by a federal or provincial government department; (3) one copy of a book for use by a non-profit library, archive, museum or educational institution; and (4) any number of copies of used books, except scientific, technical or scholarly textbooks used in a course of instruction in a non-profit educational institution.(30)

4. Exceptions

This is where much of the creator vs. user battle took place. Aside from the broadcasters succeeding in obtaining a right to make an ephemeral recording, the only clear winner, was a special class of users: public sector institutions.

(a) Fair Dealing

The fair dealing exception was updated to include all manner of news reporting (including radio, television and new media) and neighbouring rights.(31)

[ pg. 102 ]

(b) Educational Institutions

It is not an infringement for a non-profit educational institution or a person acting under its authority (presumably including teachers and students) to: (1) make a manual reproduction of a work on a blackboard, flip chart or for overhead projection;(32) (2) reproduce, translate or perform in public or communicate by telecommunication to the public a work for examination;(33) (3) perform a work, including a sound recording, in public on the premises of the educational institution, to an audience primarily of students and instructors and for educational purposes;(34) (4) make a copy of a news or news commentary program, excluding documentaries, for use in the classroom within one year of recording;(35) or (5) make a copy of any program kept for a thirty day period in order to decide whether to use the copy in the classroom.(36) The "blackboard" and "exam" exceptions identified above as (1) and (2) are not applicable where the work is commercially available in an appropriate medium.

It is unknown whether these educational institution exceptions will be interpreted to include Internet transmissions. As well, it is uncertain whether the limitation to use on the premises of the educational institution may preclude an exception for the use of works in distant learning.

(c) Libraries, Archives and Museums

Non-profit libraries, archives and museums may make a copy, if appropriate copies are not commercially available, for the maintenance or management of its permanent collection of works: (1) if the original is rare or unpublished and is damaged, deteriorating or lost;(37) (2) for on-site consultation if the original is in poor condition;(38) (3) in an alternative format if the original is in an obsolete format;(39)(4) for record keeping;(40) (5) for insurance reasons;(41) and (6) for restoration.(42)

As well, non-profit libraries, archives and museums may make a photocopy for research or private study of an article from: (1) a scholarly, scientific or technical periodical; or (2) a newspaper or periodical, other than a scholarly, scientific or technical periodical, provided it was published more than one year before the photocopy is made and was not a work of fiction or poetry or a dramatic or musical work.(43) Loans amongst non-profit libraries, archives and museums of a photocopy of a work is permissible provided the copy provided to the patron is not in digital form. Any intermediate copy must be destroyed once the copy is given to the patron.(44) Libraries, archives and museums which are not non-profit are excluded from the exception.

[ pg. 103 ]

(d) Photocopiers in Libraries, Archives and Museums

Non-profit libraries, archives and museums will not infringe copyright where a copy is made of printed material on a photocopier having a posted notice warning of infringement of copyright, provided the non-profit library, archive or museum has entered into an agreement with the copyright owner or the appropriate collective licensing the photocopying of works.(45)

(e) Archives

An archive (presumably non-profit) may make a copy of an unpublished work deposited with the archive after the coming into force of the appropriate section provided: (1) the archive gives notice to the depositor that the work may be copied pursuant to the section; and only if (2) no copyright owner prohibits copying; and (3) the copy is to be used only for research or private study.(46)

(f) Ephemeral Recordings

Phase two finally gave broadcasters the right to make ephemeral recordings of works they intend to broadcast, a right they had been aggressively pursuing ever since the 1990 Supreme Court of Canada decision in Télé-Métropole Inc. v. Bishop.(47) The new right permits broadcasters to make an ephemeral recording of a performer's performance, sound recording or work, excluding a cinematographic work, provided: (1) the broadcaster has licensed the right to broadcast the performer's performance, sound recording or work; (2) it is made solely for the broadcaster; (3) it is not synchronized with another performer's performance, sound recording or work; and (4) it is not used in an advertisement for a product, service, cause or institution.(48) The ephemeral recording must be destroyed within 30 days of making it unless the copyright owner authorizes its retention or it is deposited with an official archive upon having notified the copyright owner.(49) No ephemeral recording may be made where a license is available from an appropriate collective for the recording of a performer's performance, sound recording or work.(50)

[ pg. 104 ]

(g) Perceptual Disabilities

A person or non-profit corporation may, on behalf of a person with perceptual disabilities: (1) make a copy or sound recording of a work, except for a cinematographic work, in a format designed for people with perceptual disabilities; (2) translate, adapt or reproduce in sign language a literary or dramatic work, except for a cinematographic work, in a format designed for people with perceptual disabilities; or (3) perform in public a literary or dramatic work, except for a cinematographic work, either live or in a format designed for people with perceptual disabilities.(51) This right is not permitted for large print books(52) or where the work or sound recording is commercially available in an appropriate format.(53)

5. Statutory Damages and Summary Judgment

(a) Statutory Damages

Prior to phase two, the civil remedies available under the Act had been criticized as too far reaching or not far reaching enough. Too far reaching in that "if an artwork was painted without authority onto the side of a supertanker, the copyright owner could seize and operate the tanker for his own benefit, or sell it and pocket all the proceeds."(54) Not far reaching enough in that the civil remedies were considered too costly, complicated and time consuming to pursue the common instance of being faced with flea market or fly-by-night infringers with a relatively small number of infringing copies of each of many different works (i.e. movies, video cassettes, audio cassettes and computer programs).

With the phase two civil remedies, in the supertanker example, the courts can now consider an appropriate remedy for the infringing work distinct from the supertanker it is painted on.(55) As well, to make it easier to pursue the flea market or fly- by-night type infringers, phase two brought in U.S. style statutory damages where a copyright owner can elect (at any time prior to final judgment) to recover pre-established statutorily fixed damages instead of having to prove damages or profits of the infringer. These statutory damages range from $500 to $20,000 for all infringements in respect of each work.(56)

If the infringer was unaware or ought reasonably not to have been aware it was infringing, than the statutory damage range may drop to as low as $200,(57) or even lower in special cases.(58) Statutory damages cannot be awarded against: (1) an educational institution, library, archive or museum; or (2) an infringer in respect of gray market or parallel imported goods.(59) Collective societies have been given a very big stick to swing against those who choose not to pay the applicable royalties. They can elect to sue to recover damages in lieu of any other remedy of a monetary nature provided by the Act, ranging from 3 to 10 times the amount of applicable royalties.(60) As well, in order to deter the flagrant infringers, an election to recover statutory damages does not preclude also pursuing exemplary or punitive damages.(61) Finally, statutory damages are available only for copyright infringement, not moral rights infringement.(62)

[ pg. 105 ]

(b) Summary Proceedings

To further improve upon the previously considered costly, complex and time consuming civil remedies under the Act, phase two provided for a summary application procedure: to pursue copyright or moral rights infringers; to pursue gray marketers and parallel importers; and for collectives to pursue persons not abiding by the applicable tariffs or user agreements.(63) In provincial courts where no procedure exists for summary proceedings, phase two grants the courts the power to give such directions as would affect such summary proceedings.(64)

(c) Expanded Scope of Injunction

Phase two has confirmed the earlier practice of the courts to grant injunctions not only in respect of an infringement of the complained of work, but also in respect of any other work in which the plaintiff has a copyright interest without proof of infringement of these other works.(65) Furthermore, after the injunction has been granted, the plaintiff may claim the benefits that may extend to works at the time the proceedings were commenced, that were either non-existent or in which the plaintiff was not the copyright owner.(66)

6. Collective Administration of Copyright

Many of the new rights introduced with phase two put in place either new or expanded procedures for the collective administration of these new rights. These, along with other more technical amendments in respect of the collective administration of copyright, are of importance primarily to collectives or those dealing with them on a routine basis. However, one such amendment worthy of note is that which empowers the Governor in Council to make regulations establishing policy directions and general criteria, which the Copyright Board must have regard to in establishing fair and equitable royalties, and in rendering any other of its decisions.(67) This power grants the Governor in Council the ability to directly affect the manner in which the Copyright Board makes its decisions and establishes royalties and royalty schemes.

[ pg. 106 ]

7. Miscellaneous Other Changes

Many other lesser amendments were made to the Act, some of which will be commented on here. The three-year limitation period for civil remedies under the Act now clearly runs from either the time when the plaintiff knew or ought to reasonably have been expected to have known of the infringement, not from the time when the infringement occurred.(68) The term of copyright in photographs has been retrospectively extended to the author's life plus 50 years where the author is a natural person.(69) However, before phase two, any person owning the physical negative (or the photograph if no negative), including a corporation, is the author of the copyright in the photograph. Where a corporation is the author, the term is 50 years from the end of the year in which the negative was made. Now, where the majority of the voting shares of the corporate author are held by a natural person who would otherwise qualify as the author, the term is the author's life plus 50 years.(70)

8. Conclusions

Phase two now completes the first effort to reform the Copyright Act since 1924 and despite many significant and substantial changes and improvements much remains to be done. Phase one and now phase two have relieved a good portion of the burden on the courts of having to creatively interpret the Act in light of unforeseen issues raised by television and computer technology. However, neither phase one nor phase two adequately addressed digitization of information and the Internet, which now further strain the creative efforts of the courts and the need for legislative change. As well, the creator vs. user clash will be at its peak in formulating new laws to deal with Crown copyright. These and other important issues yet remain to be addressed in the next round of copyright reform.

The breakneck speed at which commerce is globalizing, especially through the Internet, and in which information is being digitized will ensure that new and unforeseen copyright issues will continue to arise. In such an environment, one thing is certain, the legislature cannot stand by for another 60-plus years leaving the courts to effectively read new technologies into the Copyright Act by case law.

B. WIPO Treaties - Imminent Change

1. Background

The concern for adequate protection of copyrighted works has escalated as the new digital means for transmission have proliferated globally. The exponential growth of these technologies and their increasing availability globally, as well as the inherent nature of digital media, pose the spectre of unfettered copying. In addition, there are the particular concerns for the protection of performers' rights and sound recordings, the ownership of computer generated works, copyright management systems and devices intended to defeat such systems, whether collective administration in respect of the Internet is appropriate, and database protection.

The global nature of these concerns has prompted international efforts especially by the World Intellectual Property Organization. In particular, a diplomatic conference was convened for December 1996 to consider three treaties for copyright, performers' rights and sound recording producers in the digital environment, and for database protection. In December 1997, Canada signed the two new treaties that emerged from the December 1996 WIPO diplomatic conference. The databases treaty was withdrawn. The benefits of these treaties are extolled as addressing the issue of copyright protection in the new digital environment. Indeed, the federal government has proclaimed, in calling for comments, partly as a result of the legislative activity in the United States and the effort by the European Commission to develop a suitable directive that these new treaties are quickly becoming the new international norm in terms of copyright protection. Without doubt, these two treaties make clear that copyright and related intellectual property rights apply in the digital world, and encourage more uniform international protection for sound recordings, computer programs, literary works and films.

Copyright law has long mediated between copyright owners and users, fostering protection for the former and access for the latter, whether in digital networked environments or in relation to the print medium. The true importance of these principles was recognized in Geneva at the diplomatic conference. In particular, the preamble to the WIPO Copyright Treaty(71) asserts the need to maintain a balance between the rights of authors and the larger public interest, particularly education, research, and access to information.

The two new WIPO treaties address the challenges of the digital environment. In brief, the Copyright Treaty and the Performances and Phonograms Treaty especially provide an exclusive right for authors, performers and producers of phonograms to authorize the making available of their works, performances and phonograms, respectively, to the public, by wire or wireless means in such a way that members of the public may access them from a place and at a time individually chosen by them. However, an agreed statement expresses the understanding that the mere provision of physical facilities for enabling or making a communication does not itself amount to communication.

Both require protection for electronic rights management information and prevention of the circumvention of technological measures used by authors and performers and producers. Both leave the determination of whether exhaustion of rights applies after first sale or other transfer, if at all, to each country.

The Copyright Treaty provides for copyright protection for computer programs and original databases and a rental right akin to the WTO TRIPS agreement. Minimum protection for photographic works goes from 25 years to 50 years.

The Performances and Phonograms Treaty also gives protection for other economic rights of performers and producers of phonograms including rights of reproduction, distribution and rental. Moral rights of performers in their live aural performances and their performances fixed in phonograms gain a minimum of 50 years protection. However, audiovisual fixations are not covered.

Each has come into effect by virtue of the ratification of, or accession to, these treaties by more than the required 30 states before the deadline of 31 December 1997. The texts of each are available on the Internet at http://www.wipo.int.

[ pg. 108 ]

2. Implementation of the WIPO Copyright Treaty

As indicated, few amendments to the Canadian Copyright Act will be required in order to comply with the WIPO Copyright Treaty. Each Article is summarized so that the new obligations can be appreciated, together with an indication as to whether or not a consequential amendment will be required.

Articles 1 and 3 relate to the Berne Convention and oblige contracting countries to comply with the Berne Convention. Canada already complies.

Articles 2, 4 and 5 relate to the scope of copyright. Article 2 requires that copyright protection extend only to expressions and not to ideas, procedures, methods of operation or mathematical concepts as such. Article 4, in turn, mandates the protection of computer programs as literary works, whatever may be the mode or form of their expression. Article 5 requires the protection of compilations of data or other material, in any form, which by reason of the selection or arrangement of their contents constitute intellectual creations. Again, Canada complies with the WIPO Copyright Treaty.

Article 6 requires that authors of literary and artistic works shall enjoy the exclusive right of authorizing the making available to the public of the original and copies of their works through sale or other transfer of ownership. Moreover, contracting countries may determine when exhaustion of rights applies after first sale or other transfer of ownership. Canada again complies with the Treaty.

In certain circumstances, Article 7 requires a commercial right of rental for authors of computer programs, cinematographic works, or sound recordings. In particular, the rental right shall not apply in the case of computer programs, where the program itself is not the essential object of the rental, or in the case of cinematographic works, unless such commercial rental has led to widespread copying of such works materially impairing the exclusive right of reproduction. Again, Canada is in compliance with the Treaty.

As mentioned, Article 8 mandates a right of communication to the public, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them. Canada is in compliance with the Treaty. Notably, agreed statement emerged from the conference expressing the understanding that the mere provision of physical facilities for enabling or making a communication does not itself amount to communication eliminating, inter alia, the prospect of strict liability for on-line service providers for all infringing activities that may occur on their systems.

As a consequence of Article 9, the term of protection for photographic works set out in Article 7 of the Berne Convention, which is the life of the author plus 50 years, must apply rather than the at least 25 years term of Article 7(4). The provisions for term of copyright under section 10 of the Canadian Copyright Act, providing for a term where a corporation is owner, will have to change in order to bring the Act in to compliance.

Article 10 sets out permissively that limitations or exceptions on copyright protection ought to meet a three-step test. As mentioned, they ought to address only certain special cases, they ought not to conflict with the normal exploitation of the protected subject matter, and they ought not to prejudice unreasonably the legitimate interests of the author. Canada is in compliance with the Treaty.

The new requirement for measures against the circumvention of effective technological measures that are used by authors in connection with the exercise of their rights under this Treaty or the Berne Convention comes under Article 11. Currently, such technology encompasses encryption, electronic signatures, access codes, etc., to prevent copyright infringement. Measures to prevent circumvention can be directed against the making of devices to circumvent such technology or against the act of circumventing. While the prohibition against "authorizing" infringement might catch some activity, it seems appropriate to have a specific provision to comply with this Treaty requirement against such circumvention and the distribution of altered products.

Article 12 requires new criminal and civil measures concerning rights management information. In particular, the removal or alteration of any electronic rights management information without authority, or the distribution of works knowing that electronic rights management information has been removed or altered without authority, knowing that it will induce, enable, facilitate or conceal an infringement of any right covered by this Treaty or the Berne Convention should be prohibited. Similarly, civil sanctions should apply where such conduct occurs by a person having reasonable grounds to know that it will induce, enable, facilitate or conceal an infringement of any right covered by this Treaty or the Berne Convention. The Article defines "rights management information" as:

...information which identifies the work, the author of the work, the owner of any right in the work, or information about the terms and conditions of use of the work, and any numbers or codes that represent such information, when any of these items of information is attached to copy of a work or appears in connection with the communication of a work to the public.(72)

While certain portions of the Copyright Act may address some of this Article's obligations, it would be more appropriate to adopt a specific provision.

Canada already has the effective legal measures and enforcement procedures required by Article 14 to permit effective action against any act of infringement of rights covered by the Treaty, including expeditious remedies to prevent infringements and remedies which constitute a deterrent to further infringements.

[ pg. 110 ]

3. Implementation of the WIPO Performances and Phonograms Treaty

Again, few amendments to the Canadian Copyright Act will be required in order to comply with the Treaty. Each Article is summarized below so that the new obligations can be appreciated. Also set out is an indication as to whether or not a consequential amendment will be required.

Article 1 ensures that this Treaty does not derogate from existing obligations that Contracting Parties have to each other under the Rome Convention(73) or from the existing protection of copyright in literary and artistic works. Consequently, no provision of this Treaty may be interpreted as prejudicing such protection.

Article 2 sets out the Treaty's definitions of the following concepts: performers; phonogram; fixation; producer; publication; broadcasting and communication to the public.(74)

Article 3 provides that contracting countries shall accord the protection provided under this treaty to the performers and producers of phonograms who are nationals of other contracting parties. Similarly, Article 4 provides for national treatment to nationals of other contracting countries.

There is an opting out provision and, given the Canadian content policy, it seems likely that Canada will exercise this option as to the right of remuneration pertaining to the performance in public and the communication to the public by telecommunication of published sound recordings. In addition, change to the Copyright Act will be necessary so that national treatment rules will apply more fully in favour of the beneficiaries identified in the Treaty.

The Treaty mandates moral rights of performers as to live aural performances or performances fixed in phonograms. The rights included in Article 5 were the right to be identified as the performer (except where omission is dictated by the manner of the use of the performance) and to object to any distortion, mutilation or other modification of the performances that would be prejudicial to the performer's reputation. These rights ought to last until expiry of the performer's economic rights. Currently, the Copyright Act does not provide any moral rights for performers and will require amendment.

In dealing with the economic rights of performers in their unfixed performances, Article 6 requires that performers have the exclusive right to authorize the broadcasting and communication to the public of their unfixed performances (except where the performance is already a broadcast performance) and the fixation of their unfixed performances. Again, Canada is in conformity with the Treaty.

In order to grant to performers the exclusive reproduction right in respect of their performances fixed in phonograms, in any manner or form as required by Article 7, Canada will have to amend section 15 of the Copyright Act. Section 15 contains certain limits on the right of reproduction imposed by the Rome Convention.

Similar to Article 6 in the Copyright Treaty, Article 8 requires that performers shall enjoy the exclusive right of authorizing the making available to the public of the original and copies of their performances fixed in phonograms through sale or other transfer of ownership. Moreover, contracting countries may determine when exhaustion of rights applies after first sale or other transfer of ownership. Canada again is in compliance with the Treaty.

Article 9 requires the creation of a commercial rental right in favour of performers in respect of those performances that are fixed in phonograms. Any contracting country's system of equitable remuneration of performers for the rental of copies of their performances fixed in phonograms in place as of April 15, 1994, may remain, provided that the commercial rental of phonograms is not giving rise to the material impairment of the exclusive right of reproduction of performers. Again, Canada is in compliance with the Treaty.

As mentioned, Article 10 mandates for performers a right of communication to the public of their performances fixed in phonograms, by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them. As noted, an agreed statement emerged from the conference expressing the understanding that the mere provision of physical facilities for enabling or making a communication does not itself amount to communication eliminating, inter alia, the prospect of strict liability for on-line service providers for all infringing activities that may occur on their systems.

Section 19 of the Copyright Act limits such a right in the case of both performers, (for performances fixed on sound recordings) and sound recording producers, to a right of remuneration. A full exclusive right would require an amendment of the Act.

Article 11 mandates a similar exclusive right of reproduction in favour of producers of phonograms. Canada complies with this requirement.

Article 12 mandates a right of distribution in favour of producers of phonograms similar to Article 8 for performers. Again, Canada is in conformity with the Treaty.

Article 13 requires a right of rental for producers of phonograms as well as equitable remuneration. However, there are no limitations on the rental right. Once again, Canada is in conformity with the Treaty.

Like Article 10, Article 14 mandates a similar right to producers of making their phonograms by wire or wireless means, in such a way that members of the public may access them from a place and at a time individually chosen by them. As with Article 10, change to the Copyright Act will be required.

Article 15 establishes that performers and producers of phonograms shall enjoy the right to a single equitable remuneration for the direct or indirect use of phonograms published for commercial purposes for broadcasting or for any communication to the public, including phonograms made available to the public by wire or wireless means in such a way that members of the public may access them from a place and at a time individually chosen by them. However, contracting countries may opt out. Canada already has such a right of remuneration in the Copyright Act, but excludes retransmission. Accordingly, it is likely that Canada will exercise the reservation option.

Article 16 provides for limitations and exceptions concerning the protection of performers and producers of phonograms similar to those for copyright protection in Article 10 of the Copyright Treaty. Again, Canada is in conformity with the Treaty.

Article 17 sets the required term of protection. For performers, the term is at least until the end of a period of 50 years computed from the end of the year in which the performance was fixed in a phonogram. For producers, it is at least until the end of a period of 50 years computed from the end of the year in which the phonogram was published, or failing such publication within 50 years from fixation of the phonogram, 50 years from the end of the year in which the fixation was made. The Copyright Act grants protection from the first fixation of a sound recording under Section 23(1)(b). Accordingly, change will be required to comply with the Treaty.

Article 18 sets out obligations concerning technological measures while Article 19 sets out obligations concerning rights management information. These obligations are comparable to those set out in the Copyright Treaty in Articles 11 and 12.

Finally, the Treaty requires that the enjoyment and exercise of the rights shall not be subject to any formality, that the Treaty shall be given immediate effect, and that no reservations shall apply except for Article 15(3).

[ pg. 112 ]

4. Government ActionTreaty

Last fall, the federal government called for comments regarding the obligations of these treaties and received numerous comments. Currently, selection of the appropriate legislative options is underway. Draft legislation may be expected in due course.

5. Conclusions

These two treaties clearly address challenges posed by the digital environment. However, the exponential growth of digital technologies and their increasing global availability, as well as the inherent nature of digital media will continue to concern many and we may see particular domestic variations on the implementation of these obligations. In addition, there remains the particular concerns for the protection of performers' rights and sound recordings, the ownership of computer generated works, copyright management systems and devices intended to defeat such systems (whether collective administration in respect of the Internet is appropriate) and database protection. As noted, concern over database protection remains. In terms of collective administration, as noted below in section G.1., the Copyright Board has rendered a decision in respect of Phase I of Tariff 22 introduced by SOCAN (Society of Composers, Authors and Music Publishers In Canada) in 1998, to claim an amount from Internet Service Providers as payment for allowing access to music on the Internet. Similarly, SODRAC (Society for reproduction Rights for Authors, Composers and Publishers in Canada Inc.) has filed a new tariff relating to the reproduction of music on the Internet.

[ pg. 113 ]

C. Subject Matter

1. Artistic Works

In Aldrich v. One Stop Video Ltd. and in Aldrich v. Struck(75), the British Columbia Supreme Court addressed the issue of whether copyright exists in obscene works. The plaintiff produced allegedly obscene films and videos. The defendants admitted to the reproduction, rental, and sale of copies without authority. However, the defendants asserted that copyright does not exist in obscene works.

The Court found that the plaintiffs did in fact have copyright as there is no express denial of copyright in obscene works in the Copyright Act(76), nor is there a common law denial. The Court considered Canadian, United Kingdom and United States case law and determined that despite the different principles relied on in the case law, the two different principles which evolved both looked to considerations of illegality. However, the possession of obscene materials is not in itself illegal in Canada.

In another copyright case, an application was brought before the Court in DRG Inc. v. Datafile Ltd.(77) to expunge two copyright registrations of the respondent for a series of colour coded labels used in filing systems. The applicant alleged that the series of colour coded labels used in filing systems was not properly the subject matter of copyright under section 46 [now sections 64 & 64.1] of the Copyright Act as the matter was capable of being registered under the Industrial Design Act.(78) Although the Court found that the works were the proper subject matter for copyright, it also found that the copyright registrations of the respondent were capable of being registered under the Industrial Design Act and, accordingly, not protected by copyright. The decision of the trial judge was appealed.(79) As well, between trial and appeal, the amendments to the Copyright Act affecting section 46 came into force.

The Court of Appeal first confirmed the legal principle that the rights of the parties are to be decided according to the law as it existed when the action was commenced, unless new legislation expressly states to the contrary. This was not the case here. The Court then went on to consider the substantive matter based on the old section 46 of the Copyright Act and Rule 11 of the Industrial Design Rules. In determining whether a "design" can be registered under the Industrial Design Act, the Court relied upon Cimon Ltd. v. Bench Made Furniture Corp.(80) to determine that in order to be registered under the Industrial Design Act, a design must be "a 'design' being 'applied' to the 'ornamenting' of any article. It is not restricted to a 'design' being 'applied' to an 'article'".(81) In considering whether the works were "articles" under the Industrial Design Act, the Court rejected the appellants argument that the works were "articles to which a design has been applied"(82) and bought for their artistic qualities. Therefore, the Court determined the works to be "articles" capable of registration under the Industrial Design Act.

In considering whether the works met the "ornamenting" threshold for registration under the Industrial Design Act, the Court determined that ornamentation requires no more than that a design distinguish the appearance of the article and that the works in question met this test.(83) Combining these two findings, the Court held that the works could be registered under the Industrial Design Act and as a result, the two registrations should be expunged.

Although the Court need not have commented on whether the works were the proper subject matter for copyright, it was careful to state that its silence on this issue was in no way an endorsement of the Trial Judge's findings.

The question of infringement by substantial taking was put squarely before the Federal Court, Trial Division, in 1990 in the case of Preston v. 20th Century Fox Canada Ltd.(84), which arose as a result of the motion picture "Return of the Jedi" and the television series "Ewok Adventure". The plaintiff had offered a story line for a script for television or motion film which was developed into a script by a friend and entitled "Space Pets" and having among its characters a small furry animal species known as "Ewoks". The plaintiff alleged that the "Space Pets" script had been sent to the individual defendant, George Lucas.

The defendants established they had a policy in practice to return all unsolicited scripts and materials and to isolate the defendant, Lucas, from all incoming mail. In addition, they denied copying or using any work of the plaintiff.

The Court carefully considered and set out the evidence as to the alleged genesis of the script "Space Pets" as well as the concept of the "Ewok" and its role in the film "Return of the Jedi". The Court considered there to be a number of issues raised by the plaintiff's claim based on copyright infringement including whether copyright can exist in the name "Ewok" and the description of the "Ewok" character as depicted in the script.

As the Court noted, "...while generally there cannot be copyright in a mere name; where the name identifies a well-known character copyright in the name and associated character may be recognized".(85) The Court stated that for a name and character to receive copyright status, they "must be sufficiently clearly delineated in the work subject to copyright that it become widely known and recognized".(86)

As for the "Ewok" character, the Court was of the view that the characters set out as the "Ewok" in the "Space Pets" script did not delineate the character of the "Ewok" sufficiently distinctly to warrant recognition as a character subject to copyright.(87) In particular, the Court found it difficult to distinguish the "Ewoks" from the "Olaks" in the script in terms of their general dress, use of primitive weapons, their habitats and respective roles. Accordingly, the Court was of the view that the character name "Ewok" did not have the renown necessary for there to be copyright in the name and associated character. As such, the Court concluded that "[t]he character of the "Ewok" as developed in the script "Space Pets" was not in of itself subject to copyright"(88)

In looking at another major issue in copyright law, the Federal Court, Trial Division, considered the question of infringement of copyright in the context of a tax form prepared by the plaintiff in U&R Tax Services Ltd. v. H&R Block Canada Inc.(89) The plaintiff and the defendant were competitors in the business of income tax education and training. Here, the plaintiff anticipating certain income tax changes, prepared their own version of a certain form for filing income tax. It was prepared based on government theory and releases, but not on any government drafts. The plaintiff asserted that the defendant's tax form was infringing. The defendant alleged that such a standard tax form created by a private person is not properly the subject matter of copyright but rather a "useful article" under sections 64 & 64.1 of the Copyright Act and properly protected as an industrial design. In its decision, the Court simply cited the definitions within section 64 and held the plaintiff's tax form to be proper subject matter for copyright since the paper on which the tax form was written functionally "merely serving as a substrate or carrier for artistic or literary matter".(90) As such, it was not excluded by sections 64 & 64.1 as an article that has a "utilitarian function".

Similarly, in Milliken & Co. v. Interface Flooring Systems (Canada) Inc.,(91) the plaintiffs alleged that the defendant had infringed their copyright in a textile design for a carpet. The design was created by a French designer and the plaintiffs alleged that they had acquired the rights in the design. The first issue the Federal Court, Trial Division, had to address was whether the design was a work properly protected under the Copyright Act or if it was an industrial design not protected under the Act. The Court held that section 64(4) of the Act divides works protected by copyright into two legal regimes, which include those created prior to the June 8, 1988 date on which the section came into force, and those created after such date. Those created after the date are subject to section 64 as it read after the amendments to section 64 came into force. Those created before are subject to section 64 prior to its amendment. Under the old version of the section, copyright protection was precluded for industrial designs that were both capable of registration under the Industrial Design Act and were used or intended to be used as a model or pattern to be multiplied by industrial process. In determining the creation date of the design, the Court held that a design is created not when it is applied to a finished article, but rather when the artistic work was created. In arriving at this determination, the Court, relying on the definition of "article" as "any thing that is made by hand, tool or machine", determined that the words "in a finished article" (appearing in the definition of a "design" in section 64), "only mean in a physical embodiment, divorcing the design from a mere scheme or preliminary conception of an idea."(92)

[ pg. 116 ]

2. Architectural Works

In Randall Homes Ltd. v. Harwood Homes Ltd.(93), the issue before the Manitoba Queen's Bench was the ownership of an architect's design, and whether copyright subsists in the design. The plaintiff commissioned an architect to prepare a design of a home. The plaintiff prepared brochures relating to the design, and constructed homes in accordance with these designs. The defendant prepared drawings for a home using the design from the plaintiff's brochure, and constructed a home substantially similar to that of the plaintiff. The Court found that the character of the architect's design was unique and original, and what was created was an "architectural work" within the definition of the Copyright Act. The design was therefore proper subject matter for copyright and the defendant was found to have infringed the design.

In Viceroy Homes Ltd. v. Ventury Homes Inc.(94), the plaintiff alleged that the defendant's homes infringed the copyright in the homes, brochures, and plans of four of its model homes. The Ontario Court of Appeal was left to determine whether an architectural plan for a home and/or the resultant home are properly the subject matter of copyright as "plans" or as an "architectural work of art", as defined in the Copyright Act. Relying on Slumber-Magic Adjustable Bed Co. v. Sleep-King Adjustable Bed Co.(95), the Court found that copyright does exist both in plans for a home and in the home reproduced from the plans. In determining whether the plans and homes in question were "plans" or "architectural works of art" under the Act, it turned to the definition of an "architectural work of art" which is defined as a structure of "an artistic character or design", and interpreted "an artistic character or design" to require that the structure must be "unique". The Court then went further (relying on Randall Homes Ltd. v. Harwood Homes Ltd.) and held that a "unique" home was one with "panache" and "flair". Furthermore, in reliance of the case of Lifestyle Homes Ltd. v. Randall Homes Ltd.(96), the Court suggested a "unique" home was one created for an individual as opposed to for the mass market. The Court held that the plans and homes in question were not sufficiently unique to qualify as "architectural works of art" as they did not exhibit the necessary "panache" and "flair" and were created for the mass market.(97)

In Morton v. Echo Glass Installations Ltd.,(98) the British Columbia Supreme Court considered the issue as to whether an architectural plan for a balcony is properly the subject matter of copyright as "plans", defined in the Copyright Act. Here, the defendant had used, without the plaintiff's authority, the plaintiff's balcony plans to build its own balconies. The defendant argued that copyright did not subsist in the plans. Without analysis, the Court found the plaintiff's plans to be "plans" within the Copyright Act, and as a result, the defendant's balconies infringed the plaintiff's plans.

[ pg. 117 ]

3. Dramatic Works

Prior to the amendments to the Copyright Act brought about by the 1988 Canada-United States Free Trade Agreement and corresponding Canada-United States Free Trade Agreement Implementation Act(99), copyright protection did not extend beyond communication of works by radiocommunication. These amendments brought about liability for retransmission of distant signals (effectively retransmission by cable operators). As a result, the Copyright Board proposed a new tariff determining the rates paid by Canadian cable operators to collectives in relation to the retransmission of distant signals.

Before the new proposal was implemented, the Copyright Board heard from several interested parties in Royalties for Retransmission Rights of Distant Radio and Television Signals (Re)(100). In particular, the issues of whether copyright subsists in a sports game and in the broadcaster's programming schedule (the compilation of television programs in which others own copyright) were addressed.

It was argued before the Board that there is copyright in coaches play books and game plans, and in the team crests and uniforms and that the resulting game is a "choreographic work" under the Copyright Act. Relying on well established principles, the Board held that even though a game is played as much as possible according to these plans and designs, the result was not a "choreographic work", because a sporting event, unlike a dance, is for the most part a series of random and unpredictable events.

The Copyright Board's determination was challenged by three separate applications to the Federal Court of Appeal in FWS Joint Sports Claimants v. Copyright Board.(101) For the same reasons as those given by the Board, the Court of Appeal found that there is no copyright in a sports game, citing Canadian Law of Copyright and Industrial Design(102), Nimmer on Copyright(103) and the Canadian Admiral Corporation Ltd. v. Rediffusion, Inc.(104) decision. It is interesting to note that the Court also considered jurisprudence from New Zealand and the United States. The Court referred to two New Zealand cases (Green v. Broadcasting Corp. of New Zealand(105), and Wilson v. Broadcasting Corp. of New Zealand(106)) in support of its determination that "it is necessary for copyright not to have 'changing materials' that are 'lacking in certainty' or 'unity'...even though some variations could be permitted".(107) However, the Court distinguished the United States cases, citing differences in statutory provisions and jurisprudence.

[ pg. 118 ]

4. Literary

The Federal Court, Trial Division, in the case of Apple Computer Inc. v. Mackintosh Computers Ltd.(108), had the opportunity to rule in respect of whether computer programs originally copyrighted in written form continued to be protected by copyright when replicated in the circuitry of the silicon chip. In other terms, the Court was asked to determine whether copyright subsists in the etching of copyright protectable programs on the glass of a silicon chip for a computer where the etching creates a machine readable pattern of the copyright protected programs.

The defendants admitted that the written versions of the program were subject matter for copyright and the plaintiff owned the copyright in such programs. However, they contended that they had only copied the plaintiff's silicon chip and not the assembly program and thus, had not infringed the plaintiff's copyright.

The Court held that the programs embedded in the silicon chip were software not hardware, and the circuitry of the silicon chip was both a translation and an exact reproduction of the assembly language of the copyright on the protected programs. Accordingly, the Court found the circuitry of the silicon chip to be protected under section 3(1) of the Copyright Act. The Court further considered that the circuitry may also be protected under section 3(1)(d) of the Copyright Act, which protects a copyright owner's right to "make any...contrivance by means of which the work may be mechanically performed or delivered." However, the Court considered but rejected the argument that the copyright on the protected programs contained on the silicon chip were a merger of idea and expression not protected by copyright.

The decision was appealed(109), due in part to the decision of the High Court of Australia in Computer Edge Pty. Ltd. v. Apple Computer, Inc.(110), released one week after the trial judge's decision. In a virtually identical fact situation, the High Court of Australia held that the silicon chip was a dynamic "set of electrical impulses" that could not be the subject matter of copyright. The Canadian Federal Court of Appeal supported the decision of the trial judge and found the circuitry of the silicon chip was protected as a reproduction, rather than as a translation, of the copyright protected programs. It is interesting to note that the issue of a silicon chip as a "contrivance" was not addressed by the two of the judges. The third judge, however, found them not to be "contrivances". As for the consideration of the Australian High Court's decision, the Federal Court of Appeal declined to follow it, stating that it was the result of differences between Australian and Canadian copyright legislation. As well, the Court of Appeal found the Australian case to be based on facts contrary to the Trial Judge's uncontested finding that the programs embedded in the silicon chip are software (copyrighted expressions) not hardware (electrical impulses).

This case was further appealed to the Supreme Court of Canada(111), which wholly endorsed the decision and reasoning of the Trial Judge that the circuitry of the silicon chip is a reproduction of the copyright on the protected programs in assembly language and as such, protected under section 3(1) of the Act. As well, the Court also agreed that the programs on the silicon chip were not a merger of idea and expression, but rather they constituted a conceptually and functionally unique form of expression. The Court declined to address the issue of a silicon chip as a "contrivance". As for the Australian High Court decision, the Court agreed with the Court of Appeal's decision not to apply such law in Canada and went even further, stating that the Australian approach of characterizing the program embedded on the silicon chip as a dynamic "set of electrical impulses" not included as subject matter of copyright was wrong in Canada. The Supreme Court found that:

...the appropriate approach is to view the silicon chip program as embodying a set of instructions in machine code which are designed to move information and perform other specified tasks...[and] that the silicon chip should be viewed as a static object encoded with written instructions rather than as constituting a dynamic interchange of electrical impulses.(112)

In Delrina Corp. v. Triolet Systems Inc.(113) the relevant issue before the Ontario Court General Division, was whether copyright subsists in a computer program's user interface (the display screens and keyboard commands). Here, an individual employed by the plaintiff wrote source code for a computer program and then left the plaintiff's employment and marketed a similar computer program. In considering this issue, the Court turned to the definition of "computer program" set out in section 2 of the Copyright Act which defines it to be a "set of instructions... embodied or stored in any manner". From there, the Court went on and determined that a screen display is merely a visual reproduction of a set of instructions and is accordingly protected. However, to distinguish idea from expression, the Court adopted the three-step test of abstraction, filtration and comparison set out in the United States case of Lotus Development Corp. v. Borland International, Inc.(114) It stated that where a user interface in a screen display is the result of ideas in the public domain; does no more than embody elements of the idea that are functional in the utilitarian sense; is an idea that can only be expressed in one way; and is an arrangement, system, scheme, method for doing a particular thing, procedure, process, concept, principle or discovery, in all such instances the screen display cannot be copyrighted. On the facts, the Court was not satisfied that any substantial part of the plaintiff's screen display properly the subject matter for copyright.

The plaintiff in Somerville House Books Ltd. v. Tormont Publications Inc.(115), brought an interlocutory injunction to stop the defendants distribution of an allegedly offending model (claiming copyright in a human skeleton model and assembly instructions). The Trial Judge refused the interlocutory injunction, finding that copyright did not extend to the model. Without analysis, the Federal Court of Appeal(116) held that the trial judge had clearly erred in finding that the human skeleton model was not the proper subject matter of copyright.

In the case of Gould Estate v. Stoddart Publishing Co.(117), the Court considered inter alia the issue as to whether copyright subsisted in oral statements made during a 1956 interview of Glenn Gould. The case was brought by his estate after the interviewer published a book in 1995 which included original photographs and extensive extracts from recordings made during the interview. In considering the issue of copyright in the oral statements, the Court found that copyright did not subsist in Gould's oral statements. The Court restated and confirmed the well known principles set out in Canadian Admiral Corporation Ltd. v. Rediffusion, Inc.(118), which state that for copyright to subsist, it must exist in some physical form and have a more or less permanent endurance. In addition, the principle in Walter v. Lane(119), that oral statements per se are not recognized as literary works, rather, it is the person making notes or recordings from the oral statements who owns copyright in the notes or recordings, unless they are acting merely as a scribe or amanuensis. The Court also turned to United States jurisprudence considering the case of Falwell v. Penthouse International, Ltd.(120) and stated that unstructured remarks made in an interview are incapable of copyright protection.

[ pg. 121 ]

D. Originality

1. General

In Lifestyle Homes Ltd. v. Randall Homes Ltd.(121), the Manitoba Court took another look at copyright in an architectural plan for a home and/or the resultant home (as previously mentioned in Randall Homes Ltd. v. Harwood Homes Ltd.(122)). Here, Randall Homes was the defendant in a copyright infringement action asserting that the allegedly infringed home designs were not sufficiently original to warrant copyright protection as "plans" or as an "architectural work of art" as defined in the Copyright Act. Citing University of London Press, Ltd. v. University Tutorial Press Ltd.(123), the Court stated that for copyright to attach to the works all that is needed is "a minimal amount of effort to create a design that did not exist before"(124), provided it is not copied or in the public domain. The Court continued and stated that for copyright to exist in an architectural work of art, "that work must have an artistic character or design." The trial judge then went on to find, based on expert opinion, that the plaintiff's architectural plans were not artistic, unique or distinctive and hence not original under the Act. It is noteworthy that the trial judge seemed to pay special attention to the fact that both the plaintiff and the defendant were "tract builders" and not custom builders.

The Trial decision was appealed to the Manitoba Court of Appeal(125) where the majority of the Court of Appeal agreed with the findings of the trial judge. The dissenting Judge found that the trial judge wrongly focussed on the issue of uniqueness rather than distinctiveness by a combination of elements. The Chief Justice dissented, stating that the correct approach is to consider whether the plans in their totality are distinctive, which the Chief Justice found to be the case. As well, the Chief Justice felt there was no visible difference between the plans here and in Randall Homes Ltd. vHarwood Homes Ltd.(126) where the Court found home plans to be sufficiently original to warrant copyright protection.

In Grignon v. Roussel(127), the plaintiff wrote a song which he alleged the defendant had copied. In determining infringement, the Court considered whether the plaintiff's song was original. To do so, the Court first considered who has the onus of establishing originality. The Court held that the onus is on the plaintiff to establish that his work is original. However, the Court suggested that some decisions of the Court and one writer (which the Court seemed to discount as being mostly based on United States case law) indicate that in an infringement action, the plaintiff has a prima facie presumption of originality under section 53(2) of the Copyright Act. The Court disagreed with this interpretation of section 53(2) and stated that it would only hold true if the plaintiff's work were registered, which was not the case here. It is interesting to note that the Court does not cite any cases or authors in support of its position.

In Caron v. Association des Pompiers de Montreal Inc.(128), the plaintiff alleged that the agenda published by the defendant association of firefighters infringed the plaintiff's copyright in his firefighter's calendar containing information and advertisements of interest to firefighters. The defendant alleged that the plaintiff's calendar was not sufficiently original to warrant copyright protection. Before addressing the substantive issue of originality, the Court held that the onus is on the defendant to establish on a balance of probabilities that the plaintiff's work is not original. The Court's decision on originality does not add to the body of law on this subject.

In U&R Tax Services(129), the Federal Court, Trial Division also considered the issue of whether a standard tax form created by a private person, prior to the release of the government form, (without access to government drafts and based on government theory and releases) was sufficiently original to warrant copyright protection. Although the plaintiff used government theory, releases and consulted with government officials, the Court found there was originality. Citing Canadian Admiral Corporation Ltd. v Rediffusion, Inc.(130) and the Canadian Law of Copyright and Industrial Design(131), the Court applied the 'industriousness' or 'sweat of the brow' test rather than any test of creativity. The Court stated that a compilation possesses copyright (provided it is not copied) if it is the result of labour, skill or judgment, even if the information assembled is in a form used by others. Given the Federal Court of Appeal's decision in the Tele- Direct case noted below, the finding regarding originality in this case must now be considered wrong to the extent that it is based on "industriousness" or "sweat of the brow".

[ pg. 122 ]

2. Compilations

In the case Re Royalties for Retransmission Rights of Distant Radio and Television Signals(132) the Copyright Board also held there is no copyright in the compilation of television programs in which others own copyright. Despite recognizing the skill, expertise and creativity required to create these compilations, and admitting that a broadcaster's programming schedule is a "literary work", the Board found that the broadcaster's retransmission of programmes (as listed in the schedule) does not constitute a reproduction of the schedule. As for the issue of copyright in a broadcaster's programming schedule, the Federal Court of Appeal also agreed with the Board's decision. The Court distinguished the written compilation from the scheduled programmes broadcast, in accordance with the written compilation, and held that the latter is not a literary, dramatic or cinematographic work. The Court stated that only the actual shows themselves have copyright and that the programme schedules in no way edit or provide creative input adding to the copyright shows so as to warrant a further copyright. The usual U.K. cases were cited in support of this finding including the oft cited Ladbroke (Football) Ltd. v. William Hill (Football) Ltd.(133)

With respect to the determination that there is no copyright in a broadcasters' schedule, FWS Joint Sports Claimants has been overruled by the Copyright Board in its interpretation of copyright adherence under the North American Free Trade Agreement and the Board has granted broadcasters copyright in their daily programming schedule (Retransmission Rights of Distant Radio and Television Signals Royalties 1995-97; and 1994 Tarriff Variance(134)).

In Prism Hospital Software Inc. et al. v. Hospital Medical Records Institute(135), the British Columbia Supreme Court considered whether a certain form for the reporting of medical information created by a private person is sufficiently original to warrant copyright protection. The defendant is a non-profit corporation that maintains and operates a mainframe health care database to which certain hospitals were required to report patient information. The patient information was taken from abstracts of patient records. The plaintiff created and marketed a computerized abstract collecting and reporting system. The plaintiff began developing an enhanced version of the abstracting program for the defendant. Later, to meet the defendants needs, the plaintiff began converting the enhanced program to operate in a different computer operating system. Some problems developed with the programme in the new operating system and eventually, the defendant hired on an individual to create a similar abstracting programme. The plaintiff alleged copyright infringement and the defendant, inter alia, argued that the programme was a compilation insufficiently original to warrant copyright protection.

The Court held that copyright protection is not offered to collections of facts but rather to the "original" elements of a compilation. Citing University of London Press, Ltd. v. University Tutorial Press, Ltd.(136), the Court stated that "[t]he word "original" does not in this connection mean that the work must be the expression of original or inventive thought...[.] The originality which is required relates to the expression of the thought."(137) Continuing and relying on Slumber-Magic Adjustable Bed Co. Ltd., the Court stated that in addressing the issue of originality in a compilation "it is not the correct approach to dissect the work in fragments and, if the fragments are not entitled to copyright, then deduce that the whole compilation is not so entitled; rather, the Court should canvas the degree of industry, skill or judgment which has gone into the over-all arrangement".(138) In applying these principles, the Court found the plaintiff's computer programme to represent a conceptually and functionally unique "solution" to the abstracting and collecting of patient records and to be an expression of an idea sufficiently original to warrant copyright protection.

In Tele-Direct (Publications) Inc. v. American Business Information, Inc.(139) the plaintiff compiled and published annual Yellow Pages telephone directories based on subscriber information it received from the telephone company. Sales representatives for the plaintiff would contact the subscribers to confirm the accuracy of the information received, obtain any additional information about the subscribers' businesses and attempt to sell the subscriber other listing options. The plaintiff's listings were arranged under headings, almost all commonly used in other Yellow Pages directories. The defendant database company compiled information from various sources, including Yellow Pages directories to produce several products such as business directories. The issue before the Federal Court Trial Judge was whether the "in-column listings" within the Yellow Pages directories were sufficiently original to warrant copyright protection. It was admitted that copyright subsists as a compilation in the "Yellow Pages" business telephone directories as a whole.

The Trial Court relied on Slumber-Magic Adjustable Bed Co. v. Sleep-King Adjustable Bed Co.(140) and stating that "...it is not the correct approach to dissect the work in fragments and, if the fragments are not entitled to copyright, then deduce that the whole compilation is not so entitled; rather, the court should canvas the degree of industry, skill or judgment which has gone into the over-all arrangement."(141) The Court found that much of the information in the "in-column listings" was regular subscriber information received from the telephone company, and the headings were virtually indistinguishable from those used in many Yellow Pages directories throughout Canada and the United States. The arrangement of the information in the "in-column listings" (the vast majority of which was not subject to copyright) was as a result of accepted commonplace standards of selection in the industry. As such, the Court held that there was not sufficient "originality" in the arrangement as there was only a minimal degree of skill, judgment or labour exercised in creating the arrangement. The Court declined to consider the United States cases of Feist Publications Inc. v. Rural Telephone Service Company Inc.(142) (which denied copyright in white pages for lack of originality) or Bellsouth Advertising & Publishing Corp. v. Donnelley Information Publishing Inc.(143) (which held that taking information from yellow pages directories was not copyright infringement).

In October, 1997, the Federal Court of Appeal in Tele-Direct (Publications) Inc. v. American Business Information, Inc.(144) specifically ruled that copyright did not subsist in the subject compilations of "in-column listings" found in the Yellow Pages computer data base directory. The Court held that in order to warrant copyright protection, compilations required a degree of originality resulting from "at least a minimal degree of skill, judgment and labour in its overall selection or arrangement".(145) In particular, while the originality threshold may be low, it does exist. This judgment adopted the logic of the United States Supreme Court from Feist Publications Inc. v. Rural Telephone Service Co.(146)

The Federal Court of Appeal in Tele-Direct was also considering a new statutory definition of "compilation" resulting from the words "the selection or arrangement of data" in the 1993 amendments in the NAFTA Implementation Act, which also allowed "compilations" to be related to artistic, dramatic and musical works in addition to literary works. Accordingly, the Court took into consideration the context in which the new definition of "compilation" was introduced. In particular, Article 1705 of NAFTA required each party to protect any work embodying "original" expression and more specifically "compilations" of data or other material which, by reason of the selection or arrangement of their contents, constituted intellectual creations. Based on Canada's adherence to NAFTA and Parliament's adoption of the 1993 amendments to the Copyright Act, the Court concluded that the Canadian Government "expected the Court to follow the creativity school of cases, rather than the industrious collection school" of cases present in Anglo-Canadian jurisprudence.(147)

Most notably, the 1993 amendments simply reinforced the state of law as the Court concluded:

in clear terms what the state of the law was or ought to have been: the selection or arrangement of data only results in a protected compilation if the end result qualifies as an original intellectual creation.(148)

The Court then characterized such a decision as wrong if these decisions adapted the "sweat of the brow" approach toward originality in compilations of data, "as having asserted that the amount of labour would in itself be a determinative source of originality".(149) The Court considered such an approach as irreconcilable with the standards of intellect and creativity expressly set out in NAFTA, endorsed in the 1993 amendments to the Copyright Act and already recognized in Anglo-Canadian law.

The Tele-Direct case comes at a time when the question of the appropriate form of protection for data bases is the subject of recent World Intellectual Property Organization ("WIPO") efforts. Also, the case appears against the backdrop of the European Directive on Data-Base Protection(150), and its sui generis protection, which recognizes "substantial investment" in gathering, checking and protecting the contents of data bases. As such, one may well see a new sui generis form of protection for data bases resulting from diplomatic efforts by the WIPO, or perhaps unilateral legislation by Canada, in recognition of the peculiar value of data bases.

The question of copyright in compilations consisting of telephone directories arose in the case of Ital-Press Ltd. v. Sicoli et. al.,(151) decided in May, 1999. The case involved telephone directories made up of listings, block advertisements and other components directed to the Italian-Canadian Community. The annual "guidas" were first published by the plaintiff in 1986. The defendants had published Italian and Portuguese directories as early as 1976 and for a few years thereafter. The plaintiff's complaint for infringement arose as a result of the defendants' activities in 1993 through 1996 during which the plaintiff claimed that the defendants had infringed its copyright by reproducing parts of their annual directories.

The first determination the court had to make was whether or not copyright subsisted in the plaintiff's directories. Given that the plaintiff's "guidas" were not, as the court put it, "garden-variety" telephone books but were selections of all names of Canadian residents of Italian origin or residents who might reasonably thought to be of Italian origin, the court was satisfied that the process involved sufficient skill, judgment and labour as to provide the necessary originality for copyright to subsist in the directories.(152) In addition, the court held that copyright also protected the block advertisements incorporated into the directories in that sufficient skill, judgment and labour were exercised and invested in the design and layout of the block advertisements.(153)

[ pg. 126 ]

3. Skill & Labour

The question of originality in the context of a compilation of real estate foreclosure listings arose in the case of Pool v. Pawar(154) before the British Columbia Supreme Court in 1993. The plaintiff had developed a list of foreclosed properties containing pertinent information for clients and investors. The defendants, in turn, copied and published the plaintiff's list. The Court acknowledged that there was no issue that the compilation of foreclosure listings comprised a literary work within the definition of the Copyright Act, but observed that the Act provides that copyright subsists in "original" literary works(155). The Court considered the evidence put forth by the plaintiff as to the creation and development of the compilation, but was unable to conclude that the plaintiff used particular knowledge, skill and experience in selecting the information which appeared in the compilation. Rather, the Court found that the plaintiff's publication had its genesis in another publication which was received from another.

While the Court was satisfied that the defendants had utilized the plaintiff's information and misrepresented it as its own, the plaintiff's action had to fail in that the plaintiff was unable to establish that the work was original within the meaning of the Copyright Act.

The degree of skill and labour required to ensure originality in a photograph was considered in the Québec Superior Court decision of Ateliers Tango Argentin Inc. et al. v. Festival diEspagne et diAmerique Latine Inc. et al.(156) The plaintiff photographer was paid to take a photograph for the plaintiff dance troupe. The photograph became the dance troupe's logo. The defendant dance festival organizer wanted to use the photograph to promote his dance festival, but was told that he would have to acquire the right to do so from the photographer. He then had another photographer take another photograph using the same location, choreography, model poses, lighting and camera angle. The Court held that the original photograph was original due to, inter alia, "the choice, layout and posture of the subject, the choice of camera angle and lighting, and finally by the artistic work and personal efforts of the photographer." It is worth noting that after making this comment, the Court then went on to comment further on the effort of the photographer in terms of time and energy. This latter comment would suggest that the Court might still be relying on the "sweat of the brow" test.

[ pg. 127 ]

E. Registration

In British Columbia v. Mihaljevic(157), in preparation for Expo '86, the plaintiffs adopted EXPO 86 and EXPO as official marks. Later, the defendant applied to have a design including the words EXPO 86 registered as a trade-mark and registered the same words for a design. Shortly after these filings, at approximately about the same time, the defendant began selling wares using the registered copyright, while the plaintiff began selling wares using the official marks. The plaintiffs brought suit for trade-mark infringement and the defendant counterclaimed for copyright infringement. The issue before the Court was whether a copyright registration precludes another person from using elements of the copyright as a validly registered trade-mark.

Relying on King Features Syndicate, the Hearst Corp., and Harman Watch Co., Inc. v. Lechter(158), the Exchequer Court held that the copyrights cannot prevent another from adopting, using and registering certain elements of the copyrights as official marks or trade-marks. Copyright does not confer on the owner the right to exclusive use of the work nor its constituent elements. It merely grants a right against copying. The Court dismissed the counterclaim.

The Court of Appeal agreed with the trial court and stated that the registered copyright was still valid, but the validly registered trade-marks precluded use of the copyright elements that are the trademarks in association with the identified wares and/or services of the trademarks.(159)

In Dubois v. Systemes de Gestion et d'Analyse de Données Média, Média- Source Canada Inc.(160), the Québec Supreme Court also considered the applicability of the presumption of ownership created by a certificate of registration pursuant to section 53(2) of the Copyright Act where there are two registrations for the same work. The Court held that although both registrations are prima facie valid, the presumption cannot apply as the Act does not provide for a ranking system for registrations.

In Glaxo Canada Inc. v. Apotex Inc.(161), the plaintiff filed a claim alleging the defendant had infringed the copyright in a carton get-up of the plaintiff. The plaintiff had registered the copyrights in the carton get-up. The defendant brought a motion to amend its statement of defence by adding further paragraphs denying the plaintiff's ownership of the copyright. In this context, the Federal Court Trial Division addressed the issue of whether the section 53(2) presumption of ownership created by a copyright registration prevails over the section 13(1) statement that the author is the first owner.

Relying on Circle Film Enterprises Inc. v. Canadian Broadcasting Corp.(162), the Court held that section 53(2) prevails over section 13(1) unless it is proven that someone other than the registered owner has ownership. In Circle Film, section 53(2) (then section 36(2)) was held to prevail over section 13(1) (this was the old section 36(2) which merely provided that registration was "prima facie" evidence - the words prima facie are now deleted in section 53 (2)). In Circle Film, the Court rationalized that section 13(1) began with the words "subject to this Act".

In another case of R. v. Laurier Office Mart Inc.(163), the Ontario Court General Division had to determine the relevance of knowledge of a copyright in a criminal proceeding under section 42 of the Copyright Act. The Court held that the relevance of a registration date is not restricted to section 39 purposes (limiting available remedies to an injunction where the defendant had not or ought not to have had any knowledge of the copyright), and that a registration dated after the offence date is not evidence that copyright subsisted at the offence date. However, a registration date prior to the offence date would discharge the Crown's onus to prove that copyright subsisted, though it would not necessarily discharge the onus to establish who the owner was as at the date of the offence.

In Magasins Greenberg Ltée v. Import-Export René Derhy (Canada) Inc.(164), the respondent brought an application to dismiss the applicant's motion to strike the respondent's copyright registration for a design for a jacket known as "Barbital". The Federal Court Trial Division considered the issue of whether a registration for a jacket design is properly the subject matter of copyright under section 64(2) of the Copyright Act since it is capable of being registered under the Industrial Design Act.

The Court granted the respondent's application and held that the copyright registration is valid and that, unlike the previous version of sections 64 and 64.1 (formerly section 46) which addressed the subsistence of copyright rather than the extent of copyright protection, section 64(2) does not deny a design status as a work protectable by copyright. It only addresses the extent of copyright protection conferred by the Act by providing a defence to infringement.

[ pg. 128 ]

F. Infringement

1. Presumption of Ownership

In Fletcher (trading under the name Nursery Designs) v. Polka Dot Fabrics Ltd.(165), the Small Claims Court, of the Ontario Court (General Division), had occasion to consider, inter alia, the question of the presumption of ownership with respect to a literary and artistic work, namely a cloth diaper. The Court observed that the plaintiff was entitled to use the ideas of another designer's instructions to sew a cloth diaper, provided the plaintiff did not fully or substantially copy the words and drawings of that designer's instructions. The plaintiff was also legally entitled to create a diaper pattern and have it protected by copyright. The Court observed that the plaintiff's pattern was "the fruit of the plaintiff's personal independent, creative effort"(166) and, as author, was entitled to the protection of that particular expression by copyright as the presumed owner.

[ pg. 129 ]

2. Copying

In the case of Verge v. Imperial Oil Ltd. et al.(167), the Federal Court Trial Division ruled against the plaintiff in an action for alleged infringement of the music and lyrics of a work entitled "It's a Brand New World". Certain advertising jingles were performed years ago by the defendant in association with its sponsorship of "Hockey Night in Canada" broadcasts by both radio and television. The plaintiff had registered the copyright in his unpublished music work. The Court heard testimony from the authors of the musical jingles who stated that the jingle used a musical work created independently. In addition, there was testimony from a Doctor in musicology to the effect that the works were not musically similar either melodically or by way of harmony and that despite certain identical phrases, the musical phrases and the word phrases were distinctly different. The Court set out and applied the principles articulated in the case of Gondos v. Hardy(168), which stated:

1. that there must be objective similarity between the works, or a substantial part thereof for the infringing work to be properly described as a reproduction or adaptation of the copyright work; and

2. the copyright work must be the source from which the infringing work is derived.

In the circumstances, the Court concluded there was no objective similarity between the musical score of the plaintiff's composition and the impugned jingles.(169) Moreover, the Court considered the appearance of essentially only two identical, but rather common, clichés in the respective lyrics was nothing more than and far from a unique coincidence(170). The Court was persuaded as to the coincidence in part by the presence of at least three other songs expressing words about "a brand new world" at the time the plaintiff's work and the impugned jingles were authored.

Despite defeating the attack on the originality of its calendar, the plaintiff in Caron v. Association des Pompiers de Montréal Inc.(171) was unsuccessful in establishing infringement. This occurred despite the resemblance of the two particular works in issue. The Court concluded that they were produced from the same sources of information and similar ideas were all found in the same sector, rather than copying. Moreover, the Court was persuaded by the evidence of the author of the defendants' work, that the author's creative effort and work appeared to be independent and genuine.(172) "[T]hey are certainly sufficient for me to conclude that there was no plagiarism or copying of the plaintiff's work."(173) The Court was reinforced in its view by the fact that the area of protection reserved for the plaintiff was limited since he had created his work from sources and ideas common to the same sector.

In the Delrina case, the Court not only found a lack of copyright, but also concluded that the many similarities between the two pieces of software arose without copying and so there was no infringement. Some arose because of a limited number of ways of expressions for certain solutions, while others came about from the use of common information.(174)

[ pg. 130 ]

3. Substantial Taking

As noted in Preston v. 20th Century Fox Canada Ltd. et al., the question of infringement by substantial taking was placed squarely before the Court.(175) After thoroughly and carefully considering the genesis and evolution of both scripts and both Ewok characters, the Court addressed the question of whether or not the defendants had infringed any copyright interest of the plaintiff. In assessing substantial similarity, the Court held it to be helpful to consider factors including plot, themes, dialogue, mood, setting or scenes, pace, sequence and characters, so far as these are in the recognized limits of copyright and the protected work. The Court observed that there was a dearth of Canadian jurisprudence on the test for substantial similarity and then considered both UK and U.S. case law.(176) The Court re-stated that "the test is ultimately whether the average lay observer, at least one for whom the work is intended, would recognize the alleged copy as having been appropriated from the copyrighted work."(177) Moreover, the Court emphasized that, while quantity may be a significant factor, substantial similarity is not to be measured only by the quantity of matter reproduced from the copyrighted work.(178)

Significantly, the plaintiff had not claimed similarity in plot or dialogue, therefore the Court did not address these issues. As for similarity in relation to setting or scenes, the Court was of the view that the elements of "a net trap of vines, the forest habitat and houses of the Ewoks in both ... are... standard aspects of productions concerning primitive species drawn from a common pool of folklore and not subject to copyright or protected by it."(179) Accordingly, the Court was of the view the plaintiff had failed to establish on a balance of probabilities that there was substantial similarity between the script called "Space Pets" and the film Return of the Jedi.(180)

As noted above, the Court concluded that the Ewok character as developed in the script "Space Pets" is not in and of itself subject to copyright. Finally, the Court found that if the "Space Pets" script had been received by the defendants, the script would have been returned in the normal course with a covering letter from the defendant, Lucas Film.

In 1991, the Québec Superior Court addressed the question of copyright in the distinctive and registered trademark, VISA, in the case of Visa International Service Assn. v. Auto Visa Inc.(181) It was admitted by the defendants that the trademark was an artistic work protected by copyright. The plaintiff established to the judge's satisfaction that it was the owner of the copyright and the artistic work and that the copyright had been registered. The Court considered expert evidence presented by the plaintiff as to the possibility of independent creation by the defendant. The expert concluded that several identical elements with respect to proportion, dimension, slope, spacing, structure and rhythm were such as to render the possibility of independent recreation so slight as to be dismissed.(182) According to the expert, the unskilled addition of serifs confirmed an attempt to mask the copying.(183) The Court found that the defendant had infringed the plaintiff's copyright in the artistic work constituting the VISA logo.

In the case of Hutton et al. v. Canadian Broadcasting Corp, the Alberta Court of Appeal considered a situation concerning two television series.(184) The appellant had sued the respondent for copyright infringement as well as misuse of confidential information with respect to a program entitled "Star Tracks", which became the series "Star Chart". In considering the issue of infringement as a result of substantial taking, the Court articulated the requirement for proof of both substantial similarity and copying. The Court acknowledged the caveat expressed in Preston v. 20th Century Fox Canada Ltd. that substantial similarity ought not to be measured only by the quantity of matter reproduced from the copyrighted work.(185) The Court expressed the view that the overriding "requirement for infringement is substantial similarity of the work as a whole and substantial similarity in the modes of expression."(186) With respect to copying, the Court held that a causal connection between two works is established by proof of copying or inferred from substantial similarity and access. An inference of copying can, however, be "rebutted by proof of independent creation."(187) The Court stated "the second work does not infringe the copyright of the first if it was created entirely independently".(188)

After reviewing the rationale for the conclusions reached by the trial judge as to no substantial similarity and proof of independent creation, the Court held that the trial judge had properly recognized that the test of substantial similarity is one of quality as well as one of quantity. After viewing both television shows, the Court agreed with the trial judge's conclusion that the works were "not qualitatively similar".(189) In addition, the Court confirmed the trial judge's finding that there was no causal connection. Rather, many of the similarities arose from the use of "stock devices and personal characteristics and qualifications" of the individual authors.(190)

The Québec Court of Appeal dealt with the question of copyright infringement by substantial taking in literary works in the case of market cards or "scratch cards" used in fund-raising for charitable purposes in the case of Boutin et al. v. Bilodeau et al.(191) The plaintiff had put certain tickets or cards on the market which had a number of squares covered with a thin film which, when scratched, showed the amount of the voluntary contribution. The defendant entered the market using similar cards. At trial, the judge found the