Privacy, ‘speculative invoicing’ concerns raised at Voltage hearing

TORONTO—Privacy concerns and Voltage Pictures Inc.'s previous lawsuits in the United States were the focus of a court hearing that will determine whether the studio can sue Canadian Internet subscribers whose accounts have been linked to illegal downloads of its films. Lawyers for Voltage and Internet service provider TekSavvy Solutions Inc. appeared in Federal Court Tuesday to argue over a Voltage motion that would compel TekSavvy to turn over the names and addresses of about 2,000 subscribers who have been linked to illegal downloads of Voltage's films. Voltage has asked for the subscribers' information so it can sue those subscribers for copyright infringement. TekSavvy and intervening interest group the Canadian Internet Policy and Public Interest Clinic (CIPPIC) argue those subscribers may not have been involved in infringing downloads—even if their accounts were—as other users could be have downloaded the films without the account holders' knowledge. “The owner of an IP address is under no strict liability to ensure that all others who engage in that or who use that are not infringing copyright,” Nicholas McHaffie, a lawyer with Stikeman Elliott representing TekSavvy, said at the one-day hearing. “The privacy rights of that individual become important.” McHaffie and David Fewer, general counsel for CIPPIC, argued that releasing the subscribers' information may give Voltage leverage to coerce those subscribers into settlements to avoid costly and potentially “stigmatizing” court battles. They pointed to a recent case in Oregon, called Voltage Pictures, LLC v. Does, in which a district court judge found that Voltage was trying to abuse court procedures by demanding subscribers pay a $7,500 settlement fee to avoid a similar legal battle. They said Voltage has not yet said how it will pursue the Canadian cases if it is permitted to gain access to the TekSavvy subscribers' names. “Voltage is a player in the speculative invoicing game in the United States ... We have cases where they're doing this,” Fewer said. “What makes a speculative invoicing model work isn't damages, it's the cost of defending yourself.” Under the Canadian Copyright Act, as amended by Bill C-11 last year, a movie file sharer could be sued for “non-commercial” statutory damages ranging from $100 to $5,000 “with respect to all infringements involved in the proceedings.” James Zibarras, a lawyer for Brauti Thorning Zibrarras LLP, representing Voltage, said the company has “thousands of potential defendants” against whom it could bring legal action, and may pursue litigation against some while settling with others. Others may face no legal action at all, he said, noting that the TekSavvy subscribers could include individuals, corporations, or coffee shops that offer Internet access to their customers. “It all depends on the facts of the case. The facts of each case could vary significantly,” he said of the potential for lawsuits. “It doesn’t mean there's going to be 2,000 lawsuits necessarily.” Zibarras said a 2005 case, BMG Canada Inc. v. Doe, established the Canadian precedent for granting a “Norwich Order,” like the one Voltage is seeking, for a provider to turn over subscriber information in a copyright case. Under that precedent, he said, Voltage should only be required to prove that it has a legitimate legal claim against the subscribers, and that it would not use the subscriber information for other, “improper” purposes, such as insight into the subscribers' shopping habits. “That's what the court is protecting against ... the court isn't requiring that litigation strategy is set,” he said. “There is nothing improper about early settlements,” Zibarras added, noting later that Voltage “very much intends to sue these people.” Zibarras said the court does not yet need to consider whether a subscriber's Internet account could be linked to an infringing download even if the account owner had no knowledge of that download. He said Voltage must first have access to the subscribers' names to take them to court before those defences should be considered. He said a “blanket shield” that protects all 2,000 customers, if one might have a legitimate defence, would be inappropriate. “If we follow that approach, what you're asking us to do is to actually prove our case beyond a reasonable doubt before I get the names,” he said. Zibarras said forensic copyright firm Canipre Inc. has identified the IP addresses of 2,000 TekSavvy customers who had illegal copies of Voltage films available on their computers for others to upload through online file sharing networks. He said the fact that those users were making the films available for others to download illegally is “a very clear infringement of the Copyright Act.” “This cannot go completely unenforced by anyone, ever, because it has a very real cost to Voltage and Voltage does have protection under the statutes and our laws,” he said. Fewer said the TekSavvy subscribers' privacy rights could be further violated if Voltage is allowed to look through their computers to determine if they have illegal copies of its films, and that it was little consolation that the company would not be looking for other files on those subscribers' computers. “The impact on privacy isn't that he's rummaging around on my hard drive for something in particular, it's that he's rummaging around on my hard drive,” he said. “That's the concern.” McHaffie said TekSavvy and its subscribers were “caught in the middle” of Voltage's copyright case against illegal file sharers. He said any order for TekSavvy to turn over subscribers' names should include “fence posts” that limit how Voltage can use the information and for how long, and which would restrict the company from sharing it. “It should be a pretty strong fence,” he said. No judgement was issued Tuesday. The Federal Court case docket number is T-2058-12. —With reporting by Nicholas Kyonka at nkyonka@thewirereport.ca and editing by Simon Doyle at sdoyle@thewirereport.ca --- CORRECTION: An earlier version of this story incorrectly listed The Hurt Locker as one of the Voltage films involved in the case.

Privacy, ‘speculative invoicing’ concerns raised at Voltage hearing

Broadcast | June 25, 2013

Unlock all the Canadian telecom, broadcasting and digital media news you need.

FREE TRIAL

SUBSCRIBE

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us