Supreme Court confirms that grey and black market satellite TV is illegal

A coalition of broadcasting industry players is calling on the federal government to shut down grey and black market satellite TV dealers across the country following a unanimous decision today by Canada’s highest court confirming that grey and black market satellite TV is illegal in this country. The group is asking the government to immediately convene a special task force of senior government officials to investigate, apprehend, and prosecute dealers that are breaking Canadian law. The Supreme Court of Canada ruled in favour of an appeal by licensed Canadian satellite TV provider Bell ExpressVu LP challenging a 1999 Court of Appeal of British Columbia ruling that effectively legalized the sale of unauthorized foreign satellite TV services to Canadians (CCR, Jan. 17/01). The ruling paves the way for Bell ExpressVu to proceed "very vigorously" with its lawsuit against Cam-Am Satellites and other grey and black market satellite dealers across Canada and obtain injunctions to shut them down. However, the Supreme Court did not rule on constitutional questions raised by the respondents in the case, namely Vancouver satellite dish dealer Richard Rex and his Cam-Am Satellites business, meaning there’s still more legal wrangling to come before the issue can be put to bed for good. "At ExpressVu, we see it as a vindication of our efforts to establish that the Radiocommunication Act accurately reflects the underlying Canadian broadcasting policy," Ian Gavaghan, VP and general counsel at Bell ExpressVu, said during a media briefing today organized by the broadcasting industry coalition. "…On another level there can be no doubt in anyone’s mind that satellite piracy is theft, an insidious form of theft which robs all Canadians – but particularly artists, producers, programmers and broadcasters – of hundreds of millions of dollars a year. Our hope is that the government will respond to this ruling by aggressively enforcing the legislation in order to ensure that this problem is addressed once and for all. And, it is important to move quickly. The longer we wait, the more problematic this issue will become and the greater the negative impact on the Canadian broadcasting industry as a whole." Said Janet Yale, president and CEO of the Canadian Cable Television Association: "We believe that the decision provides industry, government and consumers with clear direction about the legality of grey and black market satellite systems in Canada. Now that the law is clear, the cable industry and this coalition are calling on the government to enforce the law immediately… To that end, we’re asking the government to immediately convene a special task force of senior government officials including Industry Canada, the Solicitor General’s department, the RCMP, and revenue and customs agencies to investigate, apprehend, and prosecute dealers that are breaking Canadian law. In our view, it is now time for the government to ramp up its resources and get tough on satellite theft. We also want to bring to the attention of dealers and advertisers that they have a role in stopping any further marketing of illegal satellite systems." Added Sylvie Courtemanche, executive VP of policy and regulatory affairs at the Canadian Association of Broadcasters: "Protection of intellectual property rights, whether expressed in this decision or Bill C-48 that is before Parliament and designed to stop Internet retransmission piracy, is fundamental to our industry’s ability to operate and provide the programming Canadians love." Among those participating in the media briefing were Gavaghan; Yale; Courtemanche; Elizabeth McDonald, president and CEO of the Canadian Film and Television Production Association; and Megan McNulty, VP and associate general counsel at DirecTV. Supreme Court rules on meaning of Radiocomm Act The crux of this case rested on the interpretation of one clause within the Radiocommunication Act – Section 9(1)(c), which prohibits anyone from decoding an encrypted subscription programming signal unless authorized by the lawful distributor. At issue, was the meaning of the term "lawful distributor". The B.C. Court of Appeal concluded that only the unauthorized decoding of Canadian satellite signals is banned. Since U.S. satellite TV companies such as DirecTV Inc. and Dish Network aren’t lawful distributors in Canada, the B.C. court had ruled that decoding their unregulated TV signals is not a violation of the Radiocomm Act. Can-Am Satellites and its supporters had argued that if a criminal law isn’t clear, then the law should be interpreted narrowly and in favour of the accused. In its written arguments to the Supreme Court, Can-Am maintained that Section 9(1)(c) is meant to fight black market piracy and not grey marketing. In setting aside the B.C. appeal court’s ruling, the Supreme Court concluded that Section 9(1)(c) of the Radiocomm Act "prohibits the decoding of encrypted satellite signals, with a limited exception" for both the grey and black markets. Charter challenge being filed today Can-Am Satellites had attempted to fight this battle on the constitutional front as well as the Radiocomm Act interpretation issue. It claimed that outlawing the receipt of foreign TV signals violates Canadians’ right to free speech under the Charter of Rights and Freedoms. As expected, however, the Supreme Court ruled that if the respondents wanted to argue the Charter issue it should have made it in a lower court. "The constitutional questions stated in this appeal are not answered because there is no Charter record permitting this Court to address the stated questions," the Supreme Court stated in its decision. "A party cannot rely upon an entirely new argument that would have required additional evidence to be adduced at trial." Alan D. Gold, legal counsel for Cam-Am Satellites, said in an interview that he expected to have to argue the Charter issue at some point. "Because we won (in lower courts) on the (interpretation of the Radiocomm Act), we never got to the second one (Charter issue). Sooner or later the Charter issues would have to be litigated." He noted that a coalition of 17 groups – including parties interested in foreign programming not available in Canada – are launching a constitutional challenge in a lower court today. "All of these people have got together and are filing a constitutional challenge to the legislation. It’s being filed this morning. And we hope to be in court as soon as possible," Gold told CCR. "The government cannot constitutionally prevent Canadians from subscribing to any available services they wish," he added. "You cannot limit freedom of choice that way. It violates the constitutional rights of Canadians." Gavaghan is confident that the broadcasting industry coalition will win on the Charter question. "At the end of the day, the Charter doesn’t guarantee Canadians a right to steal," he told reporters during the media briefing. "Taking encrypted programming and decrypting it so that people can watch it for free is not freedom of expression no matter how you want pervert that term." One of Can-Am’s allies, a group calling itself the Canadian Alliance for Freedom of Information and Ideas (CAFFII), had argued in its intervention to the Supreme Court that this case was about a Canadian’s right to acquire news and information from anywhere in the world, specifically religious, musical or ethnical programming that is not currently available in Canada. "It’s a problematic issue, and somewhere down the road there’s got to be an appropriate resolution of it," Ian Angus, a Port Hope ON-based lawyer who represented CAFFII, said in an interview. "I understand the concerns that the broadcast industry has. All of those concerns are very valid but there’s got to be a way to reform the legislation to what appears to be the direction that media and communications are going. In other words, we just don’t have frontiers anymore from a communications point of view." Battle likely far from over Following two decades of arrests, civil cases and lower court decisions, the grey and black market debate has finally been decided on the legal front – at least when it comes to the Radiocomm Act (CCR, July 4/01 and Apr. 26/01). But the battle to stop the grey and black markets is likely only just beginning, as the broadcasting industry coalition raises awareness of the issue and pushes the government and law enforcement agencies to enforce the law. The Supreme Court ruling also means that there may be no need for the broadcasting industry coalition to file further complaints with the CRTC aimed at shutting down specific unauthorized grey and black market businesses (CCR, Apr. 25/02). Asked how the Supreme Court’s ruling would impact the coalition’s complaint filed with the CRTC against CTY Telecom, Yale said the coalition will have to look at its options in light of the court’s decision. It could be that there is no complaint to pursue if CTY is driven out of business, as it should be, by the ruling, she added. The broadcasting industry coalition made it clear during the media briefing that it is not advocating that law enforcement officials go after individual Canadians looking for illegal satellite dishes in Canada. "Where we want the law enforcement to focus is on the dealers, and I think from a practical perspective that is really the way to go," Yale said. Gavaghan added that Bell ExpressVu has no intention of seeking to obtain customer lists of grey and black market dealers to deny them their illegal access. He added that his company currently has no plans to implement an amnesty program to repatriate grey and black market satellite TV subscribers. However, both Bell ExpressVu and Star Choice Communications Inc. have offered such amnesty programs in the past. Bell ExpressVu’s Supreme Court appeal, heard Dec. 4, 2001 (CCR, Nov. 22/01), was allowed with costs.

Supreme Court confirms that grey and black market satellite TV is illegal

Broadcast | April 26, 2002

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