Professional Documents
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FEDERAL COURT
B E T W E E N:
Plaintiff
(Responding Party)
-and-
FEDERAL COURT
B E T W E E N:
Plaintiff
(Responding Party)
-and-
Bank of Canada
Defendant
(Moving Party)
Court File No. T-897-15
FEDERAL COURT
B E T W E E N:
Plaintiff
(Responding Party)
-and-
FEDERAL COURT
B E T W E E N:
Plaintiff
(Responding Party)
-and-
Library of Parliament
Defendant
(Moving Party)
MOTION RECORD
FOR MOTION TO STAY ALL BLACKLOCKS ACTIONS pending the determination
of Actions against Health Canada and one non-AG Canada Defendant
HAMEED LAW
43 Florence Street
Ottawa, ON
K2P 0W6
Per: Yavar Hameed
Tel: (613) 232-2688 ext. 228
Fax: (613) 232-2680
Tel: 819-994-2226
Fax: 819-953-9269
Table of Contents
Volume I
Exhibit S Email from Mr. Folz, dated September 19, 2014 250
Volume II
Volume III
Book of Authorities
1
FEDERAL COURT
B E T W E E N:
Plaintiff
(Responding Party)
-and-
FEDERAL COURT
B E T W E E N:
Plaintiff
(Responding Party)
-and-
Bank of Canada
Defendant
(Moving Party)
2
FEDERAL COURT
B E T W E E N:
Plaintiff
(Responding Party)
-and-
FEDERAL COURT
B E T W E E N:
Plaintiff
(Responding Party)
-and-
Library of Parliament
Defendant
(Moving Party)
3
NOTICE OF MOTION
FOR MOTION TO STAY ALL BLACKLOCKS ACTIONS pending the determination
of Actions against Health Canada and one non-AG Canada Defendant
TAKE NOTICE THAT the Plaintiff (moving party), 1395804 Ontario Ltd., operating as
Blacklock's Reporter, will make a motion to the Court, orally, pursuant to Rule 385 of the
Federal Courts Rules at a special sitting of the Federal Court on May 2, 2017 at 9:30
a.m. or as soon thereafter as this Court may permit.
2. Such further and other Order as this Court may deem just for the further
Canada and other non-AG Canada defendants by the Plaintiff, 1395804 Ontario
Ltd. Operating as Blacklocks (Blacklocks Reporter). The stay sought is
pending the disposition of one action against the Attorney General of Canada in
relation to Health Canada in Court File No. T-117-17 (the Health Canada
action) and one action against a non-Attorney General of Canada Defendant.
3. The Plaintiff alleges that the Defendants, (various government departments and
agencies) have unlawfully distributed its articles and breached its copyright after
having obtained the articles by way of single use subscriptions and through
misuse of passwords.
4. The Plaintiff currently has 14 actions that it has filed against the Attorney General
of Canada (AG Canada) and other non-AG Canada defendants in the Federal
Court since 2014, which remain either to proceed to discoveries and/or to be
scheduled for a pretrial and trial.
5. Eleven (11) actions have been filed against various federal government
departments and three (3) actions have been filed against non-AG Canada
Defendants, the Bank of Canada (T-745-15), Canadian Transportation Agency
(T-897-15), Library of Parliament (T-1728-15).
6. In March of 2016, this Court ordered that all actions then filed by the Plaintiff
against AG Canada and others be stayed until the disposition of the action in
court file No. T-1391-14 involving Finance Canada. The trial in T-1391-14
proceeded in September 2016 and the Court rendered its judgment on
5
8. During case management conferences held on January 23, 2017 and March 6,
2017, the parties discussed methods of proceeding with the remaining matters
following the expiry of the March 2016 stay order. The Plaintiff indicated that the
Health Canada action should proceed and all other actions should be stayed.
The Defendants, however, jointly took the position that another action should
proceed first that involved a more moderate size of distribution of Blacklocks
copyright protected articles.
9. The Defendant AG Canada also advanced a novel proposal that would bifurcate
all matters commencing first with a joint determination of damages in all files
followed by a determination of liability. However, it was unable to confirm the unit
price or the method of quantifying the unit price of Blacklocks articles for the
purpose of its intended bifurcation approach.
10. The Court also suggested that there were several options open to the parties -
including the possibility of proceeding with two actions.
11. The parties are generally ad idem with respect to the applicability of a stay of
proceedings, but disagree as to which actions should be stayed.
12. Proceeding with the Health Canada action as the next case constitutes the most
expeditious, least expensive and most just manner of addressing all issues
raised by the Plaintiffs copyright actions.
13. The breadth of issues covered by the Health Canada action would reasonably
allow for determination of the legal and factual copyright concerns that were not
6
14. In view of the Defendants contention that a more moderate scope distribution
claim should proceed and in view of the fact that issue estoppel and res judicata
would, in any event, not bind non-AG Canada parties to a ruling relating to AG
Canada, it would be reasonable to also proceed with a second case against a
non-AG Canada defendant.
15. The particulars of the Defendant Attorney Generals alternative novel proposal of
bifurcation have not been identified and would in any event require consent of all
parties with respect to reversing the legal and factual order of proceeding with
liability and damages assessment. The Plaintiff reserves its right to respond to
the Defendants cross-motion in respect of its novel proposal.
16. The Health Canada action is distinguishable on its facts from the action in T-
1391-14.
17. The Health Canada action involves alleged misuse and/or sharing of a password.
18. The size of distribution of articles in the Health Canada action will require a ruling
that deals with large scale internal and external distribution of Blacklocks content
and subsumes smaller scale distribution.
19. The Health Canada action involves a matter of ongoing copyright violation further
to multiple advisories against distribution from the Plaintiff.
20. By also proceeding with a non-AG Canada defendant, the parties will be able to
address smaller scale distribution in an institutional framework different than that
of the Government of Canada.
1. The affidavit of Tom Korski and attached exhibits or such other affidavit as may
be required;
2. Such further material as Counsel may advise and this Honourable Court may
permit.
______________________________
HAMEED LAW
43 Florence Street
Ottawa, ON
K2P 0W6
Per: Yavar Hameed
Tel: (613) 232-2688 ext. 228
Fax: (613) 232-2680
Tel: 819-994-2226
Fax: 819-953-9269
FEDERAL COURT
B E T W E E N:
Plaintiff
(Responding Party)
-and-
FEDERAL COURT
B E T W E E N:
Plaintiff
(Responding Party)
-and-
Bank of Canada
Defendant
(Moving Party)
10
FEDERAL COURT
B E T W E E N:
Plaintiff
(Responding Party)
-and-
FEDERAL COURT
B E T W E E N:
Plaintiff
(Responding Party)
-and-
Library of Parliament
Defendant
(Moving Party)
1. I am one of the owners and principal shareholders of the Plaintiff corporation and
have been directly involved in all litigation regarding claims of copyright infringement
involving Blacklocks password protected news articles as filed by the Plaintiff in both
the Federal Court of Canada and the Superior Court of Justice. Since 2014, the Plaintiff
has filed 15 actions in the Federal Court for breach of its copyright. One of these
actions has been proceeded to trial and 14 actions remain to be scheduled for
discoveries and/or trial. The present motion relates to the Plaintiffs request to stay all
actions with the exception of the action filed against the Attorney General in Court File
No. T-117-17 as well as one non-AG Canada defendant in any of Court Files T-745-15,
T-897-15 or T-1726-15.
3. The action in respect of Court File No. T-1391-14 relating to Finance Canada
(Finance Action) was heard at trial in September 2016 and a decision was rendered
by Justice Barnes dismissing the Plaintiffs action on November 10, 2016. The decision
of Justice Barnes is attached hereto as Exhibit B.
distributed internally within the Department. The Court found that there was no
distribution beyond the six recipients of the two articles and that the articles were not
distributed by Department officials outside of the Department. Based on these facts, the
Court concluded that a fair dealings defense applied to the sharing and review of
Blacklocks articles and denied the Plaintiffs claim for copyright damages. Pending the
final disposition of the Finance Action, the other 9 actions filed by the Plaintiff were
stayed since March 2016. The statements of claim in respect of these actions are
attached to this affidavit as follows:
5. The Plaintiffs claim against the Attorney General relating to the Canada
Revenue Agency (CRA) in Court File NumberT-2090-14 is attached hereto as Exhibit
C.
6. The Plaintiffs claim against the Attorney General relating to the Canadian
International Development Agency (CIDA) in Court File Number T-269-15 is attached
hereto as Exhibit D.
7. The Plaintiffs claim against the Attorney General relating to the Canada Food
Inspection Agency (CFIA) in Court File Number T-477-15 is attached hereto as Exhibit
E.
8. The Plaintiffs claim against the Attorney General relating to the Competition
Bureau in Court File Number T-1085-15 is attached hereto as Exhibit F.
9. The Plaintiffs claim against the Attorney General relating to Public Works in
Court File Number T-1234-15 is attached hereto as Exhibit G.
10. The Plaintiffs claim against the Attorney General relating to Parks Canada in
Court File Number T-1862-15 is attached hereto as Exhibit H.
13
11. The Plaintiffs claim against the Bank of Canada in Court File Number T-745-15
is attached hereto as Exhibit I.
12. The Plaintiffs amended claim against the Canadian Transportation Agency
(CTA) in Court File Number T-897-15 is attached hereto as Exhibit J.
13. The Plaintiffs claim against the Library of Parliament in Court File Number T-
1726-15 is attached hereto as Exhibit K.
14. From March 2016 to the present, five additional actions were filed by the Plaintiff
against the Attorney General of Canada. The Plaintiff filed one action against
Environment Canada (T-2042-16) in Federal Court. Additionally, four other actions,
which were originally filed in Superior Court were refiled in Federal Court in January
2017 against the following departments: Health Canada (T-117-17); Employment and
Social Development Canada (T-132-17); Transport Canada (T-133-17); Financial
Transactions and Reports Analysis Centre (T-134-17).
15. The Plaintiff is in the process of discontinuing the four Superior Court actions, so
that all actions filed may be case managed in Federal Court and proceed in one forum.
The Plaintiff does not intend to maintain actions in two forums, but rather, it seeks to
proceed with all actions against all defendants in Federal Court.
16. The Plaintiffs claim against the Attorney General relating to Environment Canada
in Court File Number T-2042-16 is attached hereto as Exhibit L.
17. The Plaintiffs claim against the Attorney General relating to Health Canada in
Court File Number T-117-17 is attached hereto as Exhibit M.
18. The Plaintiffs claim against the Attorney General relating to ESDC in Court File
14
19. The Plaintiffs claim against the Attorney General relating to Transport Canada in
in Court File Number T-133-17 is attached hereto as Exhibit O.
20. The Plaintiffs claim against the Attorney General relating to FINTRAC in Court
File Number T-134-17 is attached hereto as Exhibit P.
21. With the exception of the Plaintiffs action against the Canadian Food Inspection
Agency (CFIA), the Defendants have not moved for summary judgment against any of
the Plaintiffs actions based on the decision in the Finance Action.
22. The actions filed by the Plaintiff that remain to be scheduled for discovery and/or
pretrial and trial involve a variety of issues that are distinct from the Finance action.
These issues include the following: varying distribution sizes of Blacklocks articles,
distribution of multiple articles authored by Blacklocks, distribution to other parties
beyond a single government department, the use of media monitoring, purchase of
individual subscriptions, repeat distribution after warnings from the Plaintiff, advice from
Department of Justice not to distribute.
23. The issues arising in the 14 actions as filed by the Plaintiff can be summarized
according to the chart I have prepared and set out below:
Defendant Court Damages Single Use Password Estimated Distribution Media Advised Repeat
File Subscription Sharing Overall to other Monitoring Against Distribution
Number Purchase Distribution Departments Distribution after
warning
1 CRA T-2090- Statutory Yes Yes 43 articles Yes Yes Yes Yes
14; TBD 440 staff
Punitives :
$20,000
2 CIDA T-269- $15,193.50 Yes Yes 632 staff Yes Yes N/A N/A
15;
5 Public Works T-1234- $27, 793 Yes N/A 11 articles Unknown N/A Yes No
15; Punitive : (cut and
$10,000 paste)
6 Parks T-1862- $11,470 Yes Yes 15 articles Unknown Yes Yes No
Canada 15; Punitive : 2,160
$10,000
7 Environment T-2042- Statutory Yes Yes 31 articles Unknown N/A Yes Yes
16; TBD Unknown
Punitives : distribution
$20,000
8 Health T-117- $90,155 Yes. Yes 119 articles Extensive Yes Yes Yes
Canada 17; Punitive : Repeated 1,192 staff distribution
$25,000 purchase. to other
depts
9 ESDC T-132- Statutory Yes Yes, 813 staff Unknown N/A Yes Yes
17; TBD
Punitive:
$20,000
10 Transport T-133- $85,228.50 Yes Yes Over 4,000 Unknown N/A Yes Yes
Canada 17; Punitive: staff
$10,000
11 FINTRAC T-134-17 $11,470 Yes Yes 355 staff Unknown N/A Yes N/A
Punitive:
$5,000
Actions Relating to Non-AG Canada Defendants
12 Bank of T-745-15 $25,922.20 Yes Yes Over 30 TBD Yes N/A N/A N/A
Canada Punitive: at discovery
$20,000
13 CTA T-897-15 $13,639.10 Yes Yes 15 articles Unknown Unknown Yes Yes
Punitive:
$10,000
14 LOP T-1726- $30,000 Yes Unknown TBD Yes Unknown Yes, three in- Yes
15 Punitive: (1 article person
$25,000 confirmed meetings
pre-
discovery)
24. The above-chart summarizes key facts relating to each of the actions filed by the
Plaintiff in Federal Court as set out in the Plaintiffs claims. At present, certain facts are
not known by the Plaintiff for which the corresponding box in the chart is marked as
Unknown and the relevant particulars have not been pleaded in the statement of
claim. In other instances, despite requests made by the Plaintiff prior to litigation, there
has been no answer by the Defendant, in which the case the corresponding box is
marked as No Answer or N/A. The Plaintiff summarizes these issues to reflect
factual contentions raised that will affect the scope of litigation.
25. The Defendants have defended each of the above actions based on the principle
of fair dealing and/or based on the doctrine of copyright misuse.
26. The nine actions that were stayed before this Court and administered under case
16
27. On March 6, 2017, a further case management conference was held at which
point, the Plaintiff reiterated its request to proceed first with the action against Health
Canada (T-117-17). The AG Canada defendants advanced two proposals: 1) to
proceed with another case with more limited distribution than the Health Canada action;
or 2) to proceed with an approach that would bifurcate all matters commencing first with
a joint determination of damages in all files followed by a determination of liability. The
Defendant AG Canada was unable to confirm the method of quantifying the unit price of
Blacklocks articles or the unit price of same for the purpose of its intended bifurcation
approach.
28. The Court suggested that there were several options open to the parties
including the possibility of proceeding with two actions. However, it was decided that the
parties should have an opportunity to advance their proposals for stay and/or
management of the proceedings commencing with a motion from the Plaintiff and a
cross motion from the Defendants with rights of reply for each party. A timetable was
scheduled for proceeding the required motions.
29. To date, there has been written discoveries on certain files, whereas other files
have not proceeded to either examination for discovery or written interrogatories. The
Health Canada action, having been recently filed in Federal Court, has not proceeded to
17
examination for discovery; however, as with other actions, the parties have agreed that
the discoveries from T-1391-14 may apply.
30. In the Health Canada action the following facts have been pleaded as set out in
the statement of claim in Court File No. T-117-17 (see: Exhibit M):
On or about September 12, 2013, the Plaintiff and the Defendant exchanged
communications. During this exchange, Holly Doan, publisher at Blacklock's
Reporter, sent an email to Sean Upton, communications officer at Health
Canada, in which she advised: I note that Health Canada has purchased one
subscription to BL. Please let me know if you wish to distribute copy as per our
terms and conditions on the website and I would be happy to calculate a
discounted bulk rate.' Mr. Upton acknowledged the email."
On or about January 8, 2014, the Plaintiff communicated with Gary Holub, Media
Relations Officer, Health Canada, in reference to an interview regarding a story
relating to Health Canada. At the end of this communication, Health Canada
requested a copy of a Blacklocks article and was directed to contact Holly Doan
for subscription inquiries. The Defendant did not follow up on this inquiry or
contact Ms. Doan.
On July 14, 2014, the Plaintiff sent an email to Drummond, indicating that this
subscription did not allow for redistribution of Blacklocks news content. The
Plaintiff also directed Drummond to its terms and conditions. The Plaintiffs email
communication to Ms. Drummond is attached hereto as Exhibit Q.
On August 22, 2014, the Plaintiff sent an email to the Defendant indicating that it
had identified approximately 121 stories that were distributed to approximately
2000 names. Accordingly, the Plaintiff requested that Health Canada confirm
18
whether its content was in fact distributed to 2000 users and also requested the
identity of a gmail user whose name was redacted from the ATI request.
On September 27, 2014, after the Plaintiff undertook its own calculations, the
Plaintiff sent Health Canada an invoice in the amount of $90,100.55. This amount
represents the cost of an institutional license to a department the size of Health
Canada, and institutional license charges for the multiple instances of third-party
distribution to people within the Privy Council Office, Citizenship and Immigration
Canada, the Department of Agriculture, and the Canadian Food Inspection
Agency.
31. The ATI return, as described in the statement of claim, contains more than 50
pages or more of email addresses corresponding to more than 1,000 email accounts
that received Blacklocks articles on the media monitoring list of Health Canada. This
list, which contains email accounts from Agriculture Canada, CFIA, Citizenship Canada
and the Privy Council Office, is attached hereto as Exhibit R.
32. Through a separate ATI request unrelated to Health Canada, I am aware that
Health Canada was apprised of a series of actions filed by the Plaintiff against various
departments of the Government of Canada by virtue of an email from Patrick Folz,
acting manager, IP Law Group at the Department of Justice, referring to the Plaintiff
Blacklocks in the following terms: The company appears to be using information
obtained through access to information requests to inform its claims of copyright
infringement by the Crown The company has launched a civil action relating to its
infringement claims, a matter which received media attention. The email from Mr. Folz
is attached hereto as Exhibit S.
33. On November 30, 2014, the Plaintiff filed another ATI request relating to Health
Canada on Alberta Newsclips, at the address, alberta.newsclips@hc-sc.gc.ca, in the
normal course of its business to ensure copyright compliance. No records were found
to be responsive to this request. At the time, the Plaintiff was unaware that the account
was being managed by Line Desrosiers who was forwarding the information for use by
19
the communications officer for Health Canada in Alberta. Moreover, the failure of the
ATI request to return any documents suggested to me that the account was dormant.
The attached records relating to the Plaintiffs request and formal response from Health
Canada are attached hereto as Exhibit T.
34. On April 18, 2016, Assistant Deputy Minister Michelle Kovacevic bought a single
subscription from a personal email account, rudynoonie@gmail.com. As part of the
Plaintiffs routine due diligence follow up, the Plaintiff made an ATI request relating to
his purchase. No records were found as being responsive to this request, which is
attached hereto as Exhibit U.
35. The Plaintiff filed an action against Health Canada in the Superior Court of
Justice on May 2, 2016, which relates to the same alleged copyright violations that are
the subject of the claim in Court File Number T-117-17 before the Federal Court.
Accordingly, as of May 2016, the Defendant had knowledge of legal claims of copyright
infringement being made against Health Canada.
36. On December 19, 2016, the Plaintiff received an email from Line Desrosiers, a
media relations officer for Health Canada in Alberta, seeking renewal of her subscription
to Blacklocks. In her correspondence, she explains as follows: The account is in my
name as I am the administrative officer responsible for paying the bill, but the
subscription information goes to our Alberta Communications mailbox. This mailbox is
supported by our communications officer, who accesses the publication as part of
ongoing daily news and media monitoring for Health Canada in Alberta. The Plaintiff
previously had no knowledge of this ongoing violation of its copyright by Health Canada
in light of the misleading ATI return received in April 2014. The email exchange
between Holly Doan and Ms. Desrosiers is attached hereto as Exhibit V.
37. I am also aware, as per the attached Inquiry of Ministry tabled in the House of
Commons, identified as Exhibit W that Health Canada paid approximately $289,000
in media monitoring contracts in 2014.
20
21
22
Date: 20160303
Docket: T-2090-14
BETWEEN:
Plaintiff
and
Defendant
ORDER
UPON the motion of the Defendant for an order staying this action until the action in
The Plaintiff has instituted, within a 17-month span, 10 different actions for copyright
infringement. Seven were instituted against various departments or agencies of the Federal
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Page: 2
Government, and three against other Crown corporations or agencies (The Canadian
The facts upon which liability is alleged to arise are different in each case: The alleged
copyrighted materials news articles are different and often involve different authors, and the
specific acts of infringement copying and transmission to others internally are different in
each case.
It is in the defences, however, that commonality and similarities mostly arise: In all but
one case (T-2090-14), the Plaintiff claims damages based on lost profits, calculated in reference
to the value of an institutional licence for the agency or department in question; the Defendants
contend that these amount are inflated, speculative and not reflective of the real value of the
articles. In all cases, the Defendants raise the defence of fair dealing, because the internal
dissemination of the articles was for non-commercial purposes, such as research, media
cases, the Defendants have raised, or expressed the intention to amend to raise, the novel defence
of abuse of copyright. This last defence, in particular, relies on the alleged similarities in the
conduct of the Plaintiff in each of the 10 actions at issue, such that all actions cross-reference
each other. It is also worth noting that the amounts claimed in all actions are modest: where
The commonalities between all claims and their modest amounts cry out for some form
of streamlining and a search for efficiencies. Indeed, given particularly the interrelated defences
of abuse of copyright, the notion that there could be 10 different trials, at which the same
24
Page: 3
evidence will be led ten different times, with the attendant risk of contradictory judgements, is
Since the Defendants first raised the possibility of a stay of proceedings in November
2015, the Court has held two case management conferences to attempt to get the parties to work
cooperatively towards a solution that would achieve the just, most expeditious and least
Given that there are four different defendants, represented by different counsel, and that
the ruling in one test case would not necessarily be binding on the other defendants, it was the
Courts view that, unless the parties reached an agreement as to the applicability of certain
rulings to other cases, some form consolidation or common trial would be indicated. To address
the defendants concerns about the potentially wasted costs and the unwieldiness of defending
the non-common elements of all ten cases concurrently, the Court encouraged the parties to
discuss the possibility of severing some aspects of the actions, so that these might proceed
independently of each other. Regretfully, while some concessions were made, the parties did not
achieve an agreement. The defendants continue to pursue the stay of all actions pending the
resolution of the first, most advanced case, and the Plaintiff continues to refuse any stay and to
demand that all actions continue to be litigated and made ready for trial independently and to
address whether and how the time, manner, and date of the trials might be managed at some
unidentified later time. No party has suggested, even as an alternative remedy to the stay
requested by the defendants, that some form of consolidation, with or without bifurcation, be
ordered.
25
Page: 4
I suspect that each side remained so entrenched and focussed on their initial goals (the
Plaintiff, to move all cases as expeditiously as possible, and the Defendants, to have the validity
of their common defences ruled upon as inexpensively as possible), that they failed to open their
minds to the creative solutions that might have accommodated both sides goals. Be that as it
may, given the complexities involved and the need for all parties to work cooperatively in order
to make any compromise solution work, the Court cannot simply impose on the parties the
solution it considers best. If the parties cannot arrive at a mutually acceptable solution by
themselves, even with the Courts guidance, then they are most unlikely to be able to work
The only options that are left to be considered are therefore the stay of all actions pending
the determination of T-1391-14 one of the few actions to proceed under the normal, rather than
the simplified proceedings rules and also the most advanced or, as advocated by the Plaintiff,
to allow all actions to proceed until the pre-trial conference, and only then to consider how to
I am satisfied that, in the circumstances, the stay of the proceedings is the option that best
achieves the interests of justice and the just, most expeditious and least expensive determination
of the issues.
The Plaintiffs solution, in which a consideration of how the trials of all 10 cases could be
managed is deferred to a pre-trial conference, is a non-solution. The Plaintiff is pressing for each
pre-trial conference in 10 days. Unless T-1391-14 is stayed and all cases proceed in lock step or
are stayed as they reach the stage of a pre-trial conference, so that the pre-trial conferences can
26
Page: 5
be held in all cases concurrently, there will not be any opportunity to manage how and when
the trials are heard, as each would proceed to a pre-trial conference individually, as they are
ready, and can therefore not be assessed for a duration and trial date otherwise than in isolation.
It will be impossible to identify and account for duplications, or the potential for consolidation.
The Plaintiff has not suggested that it has contemplated, or acquiesced to delaying all pre-trials
Even if the Court were to order that all pre-trials be held together, the Plaintiff has
offered no indication of what managing the trials might entail. A single, consolidated trial on
all issues would likely be lengthy and unwieldly without a concerted effort of the parties to
cooperate to narrow issues and simplify evidence. Given the parties less than stellar
demonstration of an ability to compromise and work cooperatively so far, I hold no great hopes
of success. If the resulting consolidated trial is to last even as little as three weeks, the costs of
such a long trial would still remain out of proportion for those defendants who are facing claims
of less than $50,000. The exercise would also effectively delay the determination of even the
most advanced actions, and deliver very little cost savings to the Court or the Plaintiff, if any.
Absent a consolidation of the trials, managing trials can only mean to withhold fixing
trial dates in all or some cases pending the determination of a test case or group of cases.
Indeed, even if the ten actions can be regrouped in subgroups, it would still be wasteful and give
rise to an unacceptable risk of contradictory judgments to have four, five or even two different
trials proceed almost simultaneously before different judges on the virtually the same facts.
Withholding trial dates at a pre-trial conference is, effectively, a stay of proceedings, but one
27
Page: 6
ordered after the costs of preparing for trial have been expended in full in all cases. It is
nonsensical.
Accordingly, I find that staying all actions pending the determination of T-1391-14 is the
only solution consonant with the interests of justice. The stay will not work an injustice or
prejudice to the Plaintiff. T-1391-14 is proceeding apace, and is effectively ready to proceed to
trial. I am not satisfied that the relatively short delay to the other actions a stay would entail
would be prejudicial to the Plaintiff. I am not satisfied there is any on-going harm being suffered
by the Plaintiff that would be unnecessarily prolonged by a stay. The Plaintiffs claim is for
damages suffered from discrete, past, instances of infringement. While the determination of T-
1391-14 will not necessarily resolve all or even substantially all of the issues in the other cases,
there is a very high likelihood that it will lead to a significant narrowing of the issues. At least in
respect of the cases where the Attorney General is a defendant, the principles of issue estoppel
will likely apply to many issues between the parties. T-1391-14 is not only the most advanced, it
is proceeding as a regular action rather than a simplified action, and therefore will allow for as
thorough a contestation as is possible under the Rules. As the consolidation of the trials is likely
to be fraught with difficulty, and may not result in a more expeditious less expensive
determination of the issues, a stay is the only means by which the very real risk of contradictory
judgment and a significant waste of the Courts resources can be avoided. In turn, the earlier the
stay is ordered, the more likely it is that costs can be saved from the early determination of issues
The defendants proposed order contains a provision to the effect that, to the extent any
issue remains to be determined in the other actions following the determination of T-1391-14,
28
Page: 7
the same judge be assigned to preside over the subsequent trials. It may well be in the interests
of justice that the same judge be assigned to the other actions. That would particularly be so if
the determinations in T-1391-14 and the outstanding cases are heavily fact driven. It is,
however, premature in my view to make that assessment and to tie the Courts hands. The issue
can and should be addressed at a common case management conference to be held after the
determination of T-1391-14.
2. The parties shall, upon the lifting of the stay and having consulted each other,
advise the Court as to their intentions with respect to the continuation of this
action and provide the Court with their mutual dates of availability to participate
Mireille Tabib
Case Management Judge
29
30
f der o
Date: 20161110
Docket: T-1391-14
BETWEEN:
Plaintiff
and
Defendant
[I] This is a case about copyright. More specifically, it is a case about the fair dealing
provisions of the Copyright Act, RSC, 1985, c C-42 [the Act] in the context of third party use of
[2] The Plaintiff, carrying on business as Blacklock's Reporter [Blacklock's], contends that
officials in the Department of Finance [the Department] violated its copyright by obtaining,
(3] The Attorney General argues that Blacklock's conduct is a misuse of copyright and that
the conduct Blacklock' s complains about constitutes fair dealing under section 29 of the Act.
l. Background
(4] Blacklock's is a small Ottawa-based, online news agency. It is owned and operated by
Tom Korski and Holly Doan. Mr. Korski is the managing editor and Ms. Doan is the publisher.
Mr. Korski writes news copy for Blacklock's along with a number of free-lance reporters.
Among other duties, Ms. Doan looks after the negotiation of licensing agreements for
institutional subscribers.
[5] Blacklock's employs a paywall to protect its news copy. In order to gain access to the full
content of its news articles a paid subscription and a password are required. Single subscriptions
are available through an online application. The application does not require a subscriber to
acknowledge and accept any terms of use before the transaction is concluded. It does, however,
refer to the purchase of custom bulk rates for institutional subscribers who would like to
distribute or share Blacklock's content in-house. At the foot of the subscription application is a
reference to "Terms and Conditions" but these are not particularized and would only be seen by a
[6] Blacklock's complains that in October 2013 certain Department officials acquired and
distributed two of its news articles without its consent and without payment. For this alleged
[7] The underlying relevant facts are largely undisputed. Indeed, the parties tendered an
Agreed Statement of Facts which generally describes the conduct that is the subject of this
proceeding.
(8] In the course of writing a news story about changes to Canadian sugar tariffs, Mr. Korski
interviewed the President of the Canadian Sugar Institute, Sandra Marsden. Mr. Korski also
made enquiries of the Department seeking information about the tariff changes. The
Department's media relations officer. Stephanie Rubec, responded to Mr. Korski and provided
an explanation. Further emai l exchanges between Mr. Korski and Ms. Rubec took place
Mr. Korski by Ms. Rubec at 7:25 pm. According to Mr. Korski, he had earlier signed off on his
article and did not see Ms. Rubec 's final response until sometime the next day. Mr..Korski 's
article was then published online on October 10, 2013 without any reference to Ms. Rubec's last
response.
l9J Mr. Korski ' s article carried the headline '$30,000,000 Sugar Tax is Averted'.
Notwithstanding Ms. Rubec's several on-the-record responses to Mr. Korski's questions, his
article improperly attributed "did not comment" to the Defendant. 1 The article quoted
1
This is a practise Mr. Korski adopts when he does not accept or approve of the answers he is given from a source:
see Exhibits D-33 and D-52 and confinned by Mr. Korski's testimony.
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Ms. Marsden at length and included Mr. Korski 's characterization of a 'Department of Finance
error" in the imposition of a $30 million sugar tax on the Canadian sugar industry.
[10] Ms. Marsden's attention was drawn to Mr. Korski's article upon receipt of an email sent
to her by Blacklock's at 9:12 am on October 10, 2013. The email included the following digest
Read more.
[11] At about the same time, a Twitter message was sent by Blacklock's to Ms. Marsden
stating: ..Lucy and Ethel at Finance Canada impose a $30M sugar tax by mistake at
blacklocks.ca".
[ 12] Because Ms. Marsden could not access the entire article without a subscription she went
online and paid for a single annual subscription at a price of $148.00. She then copied
[13] Ms. Marsden testified that she was immediately concerned about the accuracy of
Mr. Korski 's article and particularly, with his pejorative attribution of an "error" to the
Department. She was concerned that this statement might be linked to her and cause damage to
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her working relationship with Department officials. In order to manage that relationship she sent
Mr. Korski's article to Patrick Halley in the International Trade Policy Division by pasting the
content of the article into an email. Ms. Marsden's email stated: 'Most of the facts are accurate
although I'm not all happy with the spin - obviously I wouldn't have characterized this as a
[14] On October 11, 2013 Mr. Korski wrote a second article on the same subject. The title of
the second piece was "'It didn't make any sense ..... Once again Mr. Korski cast the Department
[15] Using her subscription password Ms. Marsden obtained a copy of this article and again
sent it by email to Mr. Halley. Ms. Marsden testified that she was unaware of Black.lock's Terms
and Conditions for use and it never crossed her mind that, by sending the articles to Mr. Halley,
[16] At the time of receiving the subject articles, the Department did not have a Blacklock's
subscription. The evidence disclosc:s, how1:vc::r, that Ms. Rubec had made an earlier enquiry to
Ms. Doan about a bulk subscription allowing for general departmental access. Ms. Doan
provided multiple user rates of between $11,470.00 and $15,670.00 (see Exhibit P-61), but
[17] When Mr. Halley received the first Blacklock's article he forwarded it by emai l to
Ms. Rubec. Mr. Halley expressed some concern about the content of the story stating: " I think
the spin can be corrected by going through the dates and facts, especially as sugar industry
clearly understands what we did and does not agree with the reporter's characterization" (see
Exhibit D-83). Ms. Rubec responded, in part, as follows: "The reporter wrote at about 4 :30 that
he would put us down as a no comment regardless and was set on his spin [ ... ].I'm going to ask
the reporter to update his story with what I provided as lengthy information/comment. I' II let you
[18] Mr. Halley also forwarded the first article to his departmental colleagues Dean Beyea and
Scott Winter, advising them that he was in contact with Ms. Rubec "in Media Relations on
whether follow-up is needed''. Scott Winter, in tum, sent the article to his colleague,
Karen LaHay. 2
[19] When Mr. Halley received Blacklock's second story "It didn't make any sense ... " he sent
it to another colleague, Michele Govier. He also sent it to Mr. Beyea, Mr. Winter and Ms. LaHay
with the comment: ..Not totally accurate still but better than the first story" (see Exhibit D-84).
[20] Mr. Winter was a senior policy analyst in Mr. Halley's working group and Mr. Beyea
was Mr. Halley's immediate supervisor. Ms. LaHay was also a senior policy analyst who worke;;d
with Mr. Winter in Mr. Halley's group. Mr. Halley testified that each of these individuals was
included in the circulation of the Blacklock's articles because of their possible involvement in a
follow-up to the articles. Ms. Govier was included because she was working on a related anti-
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dumping file involving the sugar industry. Ms. Rubec was involved because she was the media
relations officer who had been directly communicating with Mr. Korski on the story and who
(21] The documentary record indicates that only six departmental officials received copies of
one or both of the Blacklock's articles beginning with Mr. Halley.3 Notwithstanding the stated
departmental concerns about the content of Mr. Korski's articles no further follow-up was
II. Analysis
[22] To resolve this matter I need only decide whether the conduct Blacklock"s impugns is
protected under the fair dealing provisions of the Act and. in particular, section 29. Although
there are certainly some troubling aspects to Blacklock's business practices it is unnecessary to
resolve the Attorney General's allegation that this litigation constitutes a form of copyright abuse
by a copyright troll.
[23] I accept Blacklock's point that it has established that its copyrighted material was used by
the Department without payment or consent. Indeed, the Defendant admits those facts. The
burden accordingly rests on the Attorney General to establish, on a balance of probabilities, that
2
Ms. LaHay also received a copy of the article by email from Mr. Halley on October 18, 2013.
3
1 do not accept that the evidence establishes that the articles made their way to the Minister's office, but even if
they did, nothing turns on that point.
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[24] Fair dealing by a user of copyrighted material is a well-recognized right under the Act.
Section 29 provides basic legal protection where the purpose of use is ..research, private study,
education, parody or satire." The scope of protection afforded by section 29 is also well-
understood. The policy rationale for protecting user rights has been described by
[Footnotes omitted.]
(25] The two leading cases dealing with section 29 are CCH Canadian Ltd v Law Society (?f
Upper Canada, 2004 SCC 13, (2004] I SCR 339 [CCH] and Society of Composers. Authors and
Music Publishers ofCanada v Bell Media, 2012 SCC 36, (2012] 2 SCR 326 [SOCAN]. In CCH
Chief Justice McLachlin writing for the Court noted that, in order to maintain the proper balance
between the protection of and access to copyrighted materials in the Act, the fair dealing
provision "must not be interpreted restrictively" (paras 48, 54). The Court set out a two-part test
for determining whether use of copyrighted material constitutes fair dealing, which it
1. Whether the dealing is for the purpose of "research'' or "private study", also
[26] While the Court in CCH did not define 'research", it notably concluded that "[r]esearch'
must be given a large and liberal interpretation in order to ensure that users' rights are not unduly
constrained'' (para 51 ). With respect to the second part of the test, whether something is "fair" is a
question of fact and depends on the facts of each case (CCH, para 52). Relevant factors to
consider are:
1. The purpose of the dealing, where an objective assessment is made of the ..real
purpose or motive" behind using the copyrighted work. such as for commercial
2. The character of the dealing, examining how the works were dealt with, such as
whether multiple copies of works are being widely distributed, or whether a single
3. The quantity or amount of the dealing, including the importance of the work
of the work that could have been used instead (para 57);
5. The nature of the work, such as whether the work has been published or is
6. The effect of the dealing on the work, such as whether a reproduced work is likely
[27] In CCH, the issue was whether the Law Society of Upper Canada's [LSUC] provision of
custom photocopy services to members of the LSUC was an infringement oflegal publishers'
copyrights, or whether it constituted "fair dealing". The Court's operative conclusion with
[28] The Court went on to conclude that the dealing was also fair, considering the LSUC
provides single copies of works for the specific purposes allowed under section 29, the existence
of an 'Access Policy" provided to all users, the lack of alternatives to the custom photocopy
service, the public interest in access to judicial decisions and other legal resources not being
unjustifiably restrained, and the lack of evidence tendered to show the market for the publishers
[30] In SOCAN, the issue was whether the appellants were entitled to collect royalties from
Bell for the provision of music previews" - 30 to 90 second excerpts - that could be streamed
online by consumers before purchasing the entire musical track. The previews helped users
decide whether to purchase a permanent download of the work. In concluding that the use of the
previews constituted 'research" under section 29, Madam Justice Abella said:
[Emphasis added.]
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[31] From the discussion of "research" in SOCAN, the following additional principles can be
distilled:
1. Research does not need to be undertaken for the purpose of the user engaging in
personal interest;
3. The first step in the fair dealing analysis is a relatively low threshold and does not
4. The analysis should be undertaken from the perspective of the user or consumer's
purpose.
[32] In Warman v Fournier, 2012 FC 803 at para 5,414 FTR 249, this Court also found fair
dealing to exist where website operators reproduced a copyrighted article on their website,
described as an "online political news discussion forum which is accessible to any member of the
public and which is used for discussing political issues from a conservative viewpoint."
Justice Rennie held that the use was for an allowable purpose (news reporting under section
29.2), and was fair, despite there being an arguable alternative to the dealing and despite the
[33] I am satisfied that the Department's acknowledged use of the two Blacklock's articles
constituted fair dealing. There is no question that the circulation of this news copy within the
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Department was done for a proper research purpose. There is also no question that the admitted
[34] The evidence establishes that Mr. Halley and Ms. Rubec were directly involved in
responding to Mr. Korski. They each had legitimate concerns about the fairness and accuracy of
Mr. Korski 's reporting. In particular, Mr. Korski's attribution of "no comment" to the
Department was a misrepresentation and his attribution of a mistake to the Department was, at
best, ill-informed. Even Mr. Korski admitted that this pejorative description was based on
assumptions about what had occurred. Based on what actually took place Blacklock's reference
to 'Lucy and Ethel" was also inapt and unfair. Mr. Halley and Ms. Rubec therefore had an
[35] Mr. Halley's further limited distribution of the articles to five departmental colleagues for
their review also falls squarely within the scope of permitted research. Everyone involved had a
legitimate need to be aware in the event that further action was deemed necessary.
[36] In finding the scope of use of the articles to be fair I have considered the following
(a) The articles were legally and appropriately obtained by Ms. Marsden who was a
by illicit means. In the result, the articles were no longer behind Blacklock's
(b) Ms. Marsden sent the articles to Mr. Halley for a legitimate business reason
(i.e. , to protect her business reputation and to manage her working relationship
(c) The Department received the articles unsolicited and used them (i.e., read them)
for a legitimate business purpose (i.e., to consider w hether the stories required a
response or correction);
(d) The articles were circulated among only six Department officials all of whom had
(e) No commercial advantage was sought or obtained by the Department' s use of the
(f) The two articles represented only a small fraction of the protected news copy on
Blacklock' s website;
(g) The articles contained information obtained from the Department in response to
Mr. Korski ' s queries. As a source, the Department had a direct and immediate
news source for the simple act of reading the resulting copy is likely to have a
chilling effect on the ability of the press to gather information. Such a result
(h) Mr. Halley and Ms. Rubec had a reasonable basis for their concern that the
articles misrepresented some of the information they had conveyed to Mr. Korski
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(i) Neither Ms. Marsden nor the Department were aware of. or agreed to, Blacklock's
Terms and Conditions. In any event and as noted below, those provisions did not
commercial purposes. If Ms. Marsden, as a subscriber, had the right to use and
distribute the articles for a non-commercial purpose, those who received the
U) What occurred here was no more than the simple act of reading by persons with
that will almost always constitute fair dealing even when it is carried out solely
(k) While the public interest is served by the vigilance of the press, copyright should
not be a device that serves to protect the press from accountability for its errors
and omissions. The Department had a legitimate interest in reading the articles
(37] I agree with Mr. Hameed that the deliberate breach of the accepted terms of access to and
applying the fair dealing provisions of the Act. However, the owner of copyright must establish
that the terms of use actually prohibit the access or distribution in question and that the person
[3 8] It is a simple exercise to bring the stipulated terms of use to the attention of a subscriber
acquiring access that the terms in question were read and accepted.
[39] In this case Blacklock's failed to ensure that its subscribers were aware of the Terms and
Conditions it sought to impose. According to Mr. Korski and Ms. Doan, an astute or
sophisticated subscriber to Blacklock' s would be aware of its limitations on use by the reference
on the application form to bulk user access and by the generic reference to 'Terms and
like Ms. Marsden. Because the Terms and Conditions of use were not clearly brought to
Ms. Marsden' s attention for acceptance, she had no reason to think that by sharing the two
Blacklock's articles she was breaching Blacklock's copyright or facilitating a breach by others.
[41] The requirement for bringing contractual conditions to the attention of a subscriber at the
time of purchase is well-known in the law. It is not something that is imposed by bare inference
or by falling back on the supposed sophistication of users. At a minimum the party to be bound
must be shown to have been aware of the Terms and Conditions at the time of purchase: see
Kobelt Manufacturing Co v Pacific Rim Engineered Products (1987) Ltd, 2011 BCSC 224 at
[42] I do not accept that Ms. Marsden or the Department should be taken to be aware of
Blacklock's web-based tenns of use. 4 But even if they had been aware they would have been no
further ahead. Blacklock's Terms and Conditions contain a material ambiguity concerning
downstream distribution. On the one hand they seemingly prohibit distribution by subscribers
Blacklock 's Reporter and its contents are the property of 1395804
Ontario Ltd., and are protected, without limitation, pursuant to
Canadian and foreign copyright and trademark laws.
[43] As the drafter of the above conditions, Blacklock's is bound to the interpretation most
favourable to the users of its copy which, in this case, permitted Ms. Marsdcn's distribution to
the Department for a non-commercial purpose, and by implication, permitted a similar use by
Mr. Halley.
~Ms.Marsden testified that she only wanted copies of the two articles and had no reason to search Blacklock's
website for its conditions of use when she completed the subscription application.
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[44] All of this is not to say that subscribers like Ms. Marsden have unlimited rights of use of
copyrighted material. Absent consent, subscribers and downstream users are subject to the
obligations imposed on them by the Act. But at the same time they enjoy the considerable
[45] Blacklock' s maintains that this case challenges the viability of its business model
including its right to protect news copy behind a subscription-based paywall. The suggestion that
Blacklock' s business cannot survive in the face of the minor and discrete use that took place here
is essentially an admission that the market places little value on Blacklock's work-product. All
subscription-based news agencies suffer from work-product leakage. But to customers who value
easy, timely and unfettered access to news that may not be readily available from other sources,
the price of a subscription is worth paying. It also goes without saying that whatever business
model Blacklock's employs it is always subject to the fair dealing rights of third parties. To put it
another way, Blacklock's is not entitled to special treatment because its fi nancial interests may
be adversely affected by the fair use of its material. Nothing in these reasons should however be
III. Conclusion
[46] For the foregoing reasons this action is dismissed with costs payable to the Defendant. I
am given to understand that offers to settle may have been exchanged. I will therefore invite the
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parties to address this issue in writing within ten days of this decision. Neither submission is to
JUDGMENT
THE COURT FURTHER ORDERS that the issue of costs is reserved pending the
"R.L. Barnes"
Judge
51
FEDERAL COURT
SOLICITORS OF RECORD
DOCKET: T-1391-14
APPEARANCES:
SOLICITORS OF RECORD: