For the London Free Press – July 5, 2010

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Canadian lawyers are suing for $50 million, claiming the company is making legal documents available for a fee without the authors’ approval

A class action was filed on May 25 against Thomson Reuters Corp. and Thomson Reuters Canada Ltd. on behalf of a class of Canadian lawyers and law firms across Canada to the tune of $50 million.

The lawsuit alleges that Thomson breaches copyright laws by making lawyer-created legal documents available for a fee and subscription without permission from, or compensation to, the authors of the documents.

How do they do this? It is alleged that Thomson copies publicly available court filings. That includes legal documents such as facta, pleadings, affidavits and notices of motion, prepared by lawyers. It then makes them available for download via its “Litigator” service.

The user subscribes to the service and pays a fee, then is permitted to copy and edit the documents. At no time are the authors of these documents informed that their documents are copied, sold, or reproduced.

Of notable offence to the plaintiffs is the fact that the copies available for download are branded with a statement that asserts Thomson’s copyright over the documents: “[copy] Thomson Reuters Canada Limited or its Licensors. All rights reserved.”

Lawyers are perhaps the original mash-up artists when it comes to legal documents of all kinds. All lawyers copy parts from similar documents other lawyers create and use – whether they are contracts or court documents. It is one way lawyers have always learned and documents have been improved. Lawyers have not for the most part considered copyright issues when it comes to their own documents.

The question is whether the service Thomson provides is different and whether it crosses a copyright line.

The statement of claim issued by the plaintiffs pleads that the lawyers are the owners of copyright in these legal materials and that Thomson has infringed the Copyright Act by its actions.

More specifically, the claim states:

“The defendants took more than 50,000 legal documents created by members of the proposed class, removed them from court files and copied them, scanned them into a downloadable format, posted them in their database, and then made them available to subscribers for a fee.”

Counsel for the plaintiffs are seeking to have the lawsuit certified as a class action.

If the case is certified by the court, all persons who fit the class definition will automatically be included in the class unless they choose to opt out.

Among the many claims made, the plaintiffs have asked for $50 million in general damages for the class, disgorgement of profits made by Thomson from the infringement, $1 million in punitive damages, litigation costs, and a permanent injunction from using the documents.

Thomson of course has a different viewpoint, and will defend the action.

The case will be decided on the subtleties of copyright law. But it boils down to this.

Though the sharing of legal documents has always been an accepted and necessary way of practising law, does doing it in a commercial way such as Thomson does cross a legal line?

For the London Free Press – June 7, 2010

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Ontario court says website operators can’t always be ordered to disclose the identity of posters accused of defamation.

On May 3, 2010, an Ontario Divisional Court appeal decision addressed the issue of whether a web site operator should be required to produce information that could identify individuals who posted allegedly defamatory comments on that website.

The decision made clear that Canadian courts will order the release of information to identify anonymous posters – but only if certain tests are met first.

In Warman v. Wilkins-Fournier, the plaintiff sued Frank Fournier and Constance Wilkins-Fournier, the owners and operators of the freedominion.ca website plus eight John Does. At issue were allegedly defamatory comments posted on that site, and whether the defendants had to disclose information about the anonymous posters so the plaintiff could sue them.

To determine the identity of these individuals, Warman brought a motion before the Ontario Superior Court asking the court to require the Fourniers to provide information about the individuals’ e-mail addresses, personal information used during registration, IP addresses and documents relating to the establishment and ongoing operation of the website.

Justice Kershman was of the opinion that the plaintiff need not show anything to compel the defendants to disclose.

“In fact, the obligation is on the Defendants to disclose”, stated Kershman.

The Fourniers appealed that decision and argued those who use forums do so with the expectation that their comments will be kept anonymous.

The Canadian Civil Liberties Association and the University of Ottawa’s Canadian Internet Policy and Public Interest Clinic intervened. Both argued the court should not order disclosure unless public interest favouring disclosure outweighs freedom of expression and privacy concerns.

The Ontario Divisional Court parted with Kershman and decided the release of identifying information is not automatic.

The court relied on the Sony BMG v. Doe case, where the Canadian Recording Industry Association tried to get the names of online music file sharers. After taking into account five factors cited in that case, the Ontario Divisional Court unanimously held that although the motions judge was alert to the need to take the privacy interests of the unknown alleged wrongdoers into account, the need to consider the interest in freedom of expression was not raised by the parties or considered by the motions judge.

The court ruled judges must consider the following factors whether information on anonymous posters should be revealed in defamation cases:

• Whether the unknown alleged wrongdoer could have a reasonable expectation of anonymity in the particular circumstances;
• Whether the plaintiff has established a case against the unknown alleged wrongdoer and is acting in good faith;
• Whether the plaintiff has taken reasonable steps to identify the anonymous party and has been unable to do so; and
• Whether the public interest favouring disclosure outweigh the legitimate interests of freedom of expression and right to privacy of the persons sought to be identified if the disclosure is ordered.

The Court allowed the appeal and sent it back for re-consideration.

For the London Free Press – May 17, 2010

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Court says popular site is not responsible for counterfeit items

We are all familiar with the sayings: “buyer beware,” “all that glitters is not gold” and “if it’s too good to be true, it probably is.” Case in point: On eBay, three out of every four items advertised as Tiffany’s jewelry are counterfeit products.

Nonetheless, the United States Court of Appeals has recently upheld the decision that eBay is not liable for trademark violations as against the jewelry retailer Tiffany. This decision is significant to retailers and the general public alike.

In 2004, after suspecting knockoffs of its jewelry were being sold on the eBay site, employees of Tiffany’s purchased hundreds of purported Tiffany’s products and tested them. Tiffany’s discovered three out of every four items were fake.

Based on this information, Tiffany sued eBay for trademark violations on its site. Tiffany alleged that eBay had general knowledge that the infringement was occurring.

As noted in the appeal decision, more than six million new listings are posted on eBay daily. And on any given day, it contains more than 100 million listings. eBay’s evidence at trial was that it spends as much as $20 million a year on tools to promote trust and safety on its website. In fact, eBay has an entire “trust and safety” department with more than 4,000 employees.

One of the tools that eBay cited in its defence is a rapid notice-and-takedown system called VeRO — the verified rights owner program.

This program allows eBay to respond very quickly to trademark complaints and, when necessary, to remove infringing content. Repeat offenders were suspended from selling their goods on eBay. EBay submitted that hundreds of thousands of infringing sellers were suspended each year.

The court has come to the right decision in this case. EBay itself is not the party selling counterfeit goods or violating trademarks. And it does deal with sellers making false claims when made aware of it.

If Tiffany had been successful, it would have likely resulted in over-policing of vendors by all online intermediary selling sites. (Other examples of such sites are Craigslist and Kijiji.) If these companies had to worry about trademark lawsuits and liability for every single sale that took place on their sites — and thus verify the authenticity of everything offered for sale on their sites — there would be a chill on e-commerce.

At the very least, there would certainly be much stricter guidelines for what could be sold on the site and who could sell it. Strict guidelines would undoubtedly result in higher costs and some legitimate sellers being excluded.

The ruling should be considered a win not only for the intermediary companies, but also for online sellers and consumers as well.

It should be noted, however, that eBay has not been so successful in other jurisdictions.

For example, in 2009 a French court found eBay responsible for brand counterfeiting and ordered them to pay the luxury group LVMH 80,000 euros in compensation for damages caused to famous perfume brands such as Christian Dior and Kenzo.

John Gregory has a good post on Slaw talking about a recent English case that considered when an email is received for the purpose of accepting an offer of a contract.

In some ways, it seems odd to discuss notices by email in a time where we talk about service of court documents by facebook and twitter.

But there are some real practical issues to consider when determining when an email is actually or deemed to have been received.  The date and timing can lead to major consequences for things like contract formation or termination.

For example, what if the email gets caught in a spam filter? What if the recipient doesn’t check their email?  What if the email address is no longer in use?  Does it make a difference if the recipient carries a smartphone after business hours?

When entering a contract that has a notice provision – don’t just add email (or facebook or twitter) to the list of acceptable notice requirements without putting some thought into these issues.

For the London Free Press – May 10, 2010

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Judge finds that electronic method of signing notices is valid

In September 2009, London police implemented a new system that allows officers to issue Provincial Offence Notices electronically.

This system requires the police officer to log into a computer and enter certain information such as date, name, address, charging statute, charging section and signature. The ticket is then printed on a mobile printer and provided to the offender.

This electronic system was the subject of a recent Ontario Superior Court of Justice decision in the Corporation of the City of London v. Brian Caza, Michael Gorlick and Chelsea O’Donoghue.

On March 11, the City of London brought an application before Madame Justice Morissette in London, seeking an order to set aside the decision of justice of the peace Jacob Bruinewood on Jan. 5 to quash three certificates of offences and an order to enter convictions for the offences.

On Nov. 18, 2009, Const. Cory Rowsell of London police served three certificates of offence on three different individuals with respect to separate offences.

London police had implemented the new system at that time, and as a result, the electronic device used by Rowsell to issue the tickets affixed an e-signature in the signature box on behalf of the constable.

The tickets were filed on Nov. 24 and remained in the possession of the court administration throughout the statutorily imposed 15-day period.

On Jan. 5, upon examining the tickets, Bruinewood quashed all three tickets on the basis that there was no “signature of the provincial offence officer.” As a result, the City of London brought an application before Morissette.

In her reasons for decision, Morissette noted that under the Provincial Offences Act (POA), a certificate of offence may be completed and signed electronically in accordance with the regulations.

“The operation of Ontario Regulation 497/94 made under the POA provides statutory authority for tickets issued pursuant to the POA to be generated and signed electronically,” Morissette noted in her decision.

Morissette ultimately held that “the electronic signature of the police officer affixed to the certificate of offence is presumed to be correctly affixed in accordance with the officer’s official duties pursuant to the POA, and its regulation”.

The court made an order for certiorari quashing the three decisions of Bruinewood and an order for mandamus directing Bruinewood to enter convictions for all three offences.

This result is not surprising, and reflects the intent of the regulation that an electronic signature on a ticket, provided it is generated in a reasonably reliable manner, is the equivalent of a handwritten signature. But it is always good to see statutes and court decisions that support advances in technology and the efficiencies and advantages they bring.

The National Post ran a story yesterday after a JP refused to allow defence counsel to use his laptop in the courtroom, on the basis that it violated a rule against electronic recording devices.  The trial was adjourned because his notes were on it, and he could not proceed without it.

The tech law community is collectively scratching its heads about this for many reasons.   Some judges and lawyers understand the advantages of and encourage tech in the courtroom, but others, as the article quotes Mr. Justice Thomas Granger:   “look on computers with disdain, clinging to ancient courtroom traditions.”

In my view, even if counsel was to record the proceedings for his/her own use – what’s the harm in that?    As I’ve said before, “because we’ve always done it that way” is never a good answer.

That’s the title of my Slaw post for today.  It reads as follows:

We have not heard much about this lately, partly because a summary judgment in 2007 stated that Novell owned the Unix code.   A jury confirmed last week that SCO had not acquired the copyright to Unix from Novell in an asset purchase agreement.

The significance of this to the world at large is that Linux was derived from Unix.  SCO launched a long standing battle claiming it owned Unix, and thus had rights to certain code within Linux, and thus the right to be compensated for Linux use. 

Apparently, SCO is not yet giving up though – there is some suggestion that it might continue the fight, however futile it might be.

For more details, see this Groklaw post.

That’s the title of my Slaw post for today.  It reads:

For the London Free Press – January 25, 2010

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“Responsible communication” expands media freedom of expression and opens door to more frank discussion of matters of public policy

If you don’t have anything nice to say, be sure to say it in the name of public interest.

The Supreme Court of Canada recently changed defamation law with its ruling in Grant v. Torstar. The case dealt with allegations that a wealthy land developer in Northern Ontario had bypassed regular government approval procedures for building a golf course, courtesy of friends in high places.

The Charter of Rights and Freedoms guarantees freedom of expression. But there’s a limit to what one can express.

Under defamation law, if a statement unjustifiably compromises a person’s reputation, that person can sue for damages.

In recent years, there has been concern that defamation law has resulted in media outlets suffering “libel chill.” The suggestion is the media have toned down or left out what they wished to say, for fear of being sued.

In the Grant v. Torstar decision, the Supreme Court created a new defence to defamation. This “responsible communication” defence effectively expands the freedom of expression afforded to media and opens the door to more frank discussion of matters of public policy.

To succeed, the new defence requires that the publication must be a matter of public interest, and the publisher must have been diligent in trying to verify the allegations. Factors to be considered when measuring diligence are:

• the seriousness of the allegation
• the public importance of the matter
• the urgency of the matter
• the status and reliability of the source
• whether the plaintiff’s version of the story was asked for and accurately reported
• whether including the defamatory statement was justifiable
• whether the statement’s public interest lay in the fact that it was made rather than its truth
• other relevant circumstances.

In other words, it is now possible to inaccurately report something of public interest, but have a viable defence to defamation so long as you take steps to get your facts straight at the outset.

This change is unlikely to result in a media free-for-all. In the decision, Chief Justice Beverley McLachlin cautions “The protection offered by a new defence based on conduct is meaningful for both the publisher and those whose reputations are at stake. The press and others engaged in public communication on matters of public interest, like bloggers, must act carefully, having regard to the injury to reputation that a false statement can cause.”

It is noteworthy that bloggers are explicitly included in this test. Whatever uncertainty existed previously about allegations in cyberspace, the law is now clear: if you make controversial claims, you must do due diligence, however you publish them.

For the London Free Press – December 14, 2009

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COMPUTERS: In a hardware-software legal war, the company reaches a partial, $2.7-million US settlement with knock-off computer maker

Apple’s business model is to sell hardware with software on it. It does not intend for its operating systems to be installed on hardware it doesn’t make and its software licences expressly forbid it.

But that hasn’t stopped people installing Apple operating systems on non-Apple machines, dubbed Hackintoshes, from “hacker” and “Macintosh.” The main attractions are lower prices and wider selection of hardware.

Several companies have created bargain-priced, knock-off computers able to run Apple software. The most widely used is the OSx86 project, which runs the Mac OS X operating system on non-Apple computers with x86 architecture-compatible processors.

Apple software licences strictly prohibit use on computers that aren’t “Apple-labelled.” But companies such as Psystar and PearC have released products that let consumers use Apple software on non-Apple computers at considerable savings.

Apple has fought back in several ways.

The latest Apple OS version 10.6.2 added code to prevent it being used with the Atom chip used in most netbooks, a common Hackintosh platform. But within a week, a Russian-based hacker had circumvented the code.

Apple also has taken its Hackintosh battle to the courts.

On July 3, 2008, Apple filed suit against Psystar Corp. for violating the licence and breaching Apple’s copyright-protected technologies.

The end-user agreement for Mac OS X reads: “You agree not to install, use or run the Apple software on any non-Apple-labelled computer, or to enable others to do so.”

Psystar began selling PCs hacked to run Apple software — and priced more than $2,000 lower than an Apple notebook — in April 2008. After the suit was filed, Psystar kept selling systems and even created new ones.

Last month, the U.S. District Court judge trying the case found Psystar had violated Apple’s copyrights and anti-circumvention provisions of the Digital Millennium Copyright Act.

Two weeks later, Apple filed a motion against Psystar seeking statutory damages of between $500,000 and $4.5 million US, plus attorney’s fees and costs. Apple also wants Psystar permanently enjoined from continuing a business causing “irreparable harm” to Apple’s business, brand and goodwill.

In the most recent development, a partial settlement has been reached. Psystar agreed to stop selling Hackintoshes and pay Apple about $2.7 million in damages in return for dismissal of some Apple claims. But Apple can’t collect until appeals are complete, which may take years.

Though this is a success for Apple, it remains to be seen what effect it will have on the Hackintosh phenomenon as a whole.