FEDERAL COLIRT OF APPEAL

BE TWE E N:
Court File Nos. A-339-11
A-395-11
THE ASSOCIATION OF COLLEGES AND UNIVERSITIES OF CANADA and
THE UNIVERSITY OF MANITOBA
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THE CANADIAN COPYRIGHT LICENSING AGENCY
operating as "ACCESS COPYRIGHT"
MEMORANDUM Of FACT AND LAW
OF THE RESPONDENT
OVERVIEW
Applicants
Respondent
1. The applications for judicial review in Court Files No. A-339-11 (the "339 Application")
and A-395-11 (the u395 Application") are being heard together by order of Stratas J. dated
January 23, 2012. In both applications, the Association of Universities and Colleges of Canada
("AUCe") and University of Manitoba (UU of MI7) seek judicial review of two interlocutory rulings
of the Copyright Board the first issued on August 18, 2011 (the IIAugust 18 Ruling")
and the second issued on 23,2011 (the "September 23 Ruling").
The August 18 Ruling
2. The August 18 Ruling, which is the subject of the 339 Application, dealt with a number of
matters, including the issue sought to be reviewed by the Applicants, i.e., the request that
AUCC member institutions that say they are not operating under the Interim Tariff answer
Access Copyright's interrogatories (the Ulnterrogatories"). However, the Board's August 18
Ruling was simply a ,confirmation by the Board that the AUCC was required to comply with the
Board's ruling of June 6
1
2011, which inter alia directed AUCC _ to seek answers from a
representative sample of instituti<;ms that "do not avail themselves of the interim tariff' (the IIJune
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6 Ruling,,).1 The AUCC never sought judicial review of the June 6 Ruling. The Applicants'
Memorandum of Fact and Law does not alert the Court to, this, but instead the Applicants
attempt to characterize the August 18 Ruling as a new and stand-alone ruling. The 339
Application is time-barred under section 18.1 of the Federal Court Act and should be dismissed
on this basis alone.
3. Even if this Honourable Court is inclined to treat the August 18 Ruling as a new and
stand-alone decision of the Board and subject to review, the 339 Application should be
dismissed. The Board's August 18 Ruling is an interlocutory decision of the Board and there are
no special or. e.xceptional circumstances for departing from the rule that judicial review should be
sought after final decisions of a federal board. The 339 Application should be dismissed for this
reason.
4. In the alternative, the August 18 Ruling confirming the June 6 Ruling is correct, certainly
reasonable, and should not be set aside. The Applicants argue that the Board's decision is
unreasonable because it subjects IInon-parties" to "discovery". With respect to the Applicants'
argument that the Opt-Out Institutions are IInon-partiesJl and that the AUCC did not represent the
Opt-Out Institutions in respect of the August 18 Ruling (or, for that matter the June 6 Ruling),
there is no merit to this argument for the following reasons:
(a) the AUCC applied for objector status in the Tariff Proceeding on behalf of all of
its 77 AUCC member institutions located outside Quebec, and was granted
objector status in the Tariff Proceeding on this basis;
(b) the AUCC has never once' in any of its submissions to the 'Boatd (including with
respect to the August 18 and June 6 Rulings and the September 23 Ruling)
advised the Board that it did not represent all AUCC member institutions outside
Quebec. At all times, the AUCC held itself out to the Board as representing all of
its 77 members outside Quebec and the ~ o a r d was entitled to rely on this; and
(c) the AUCC made detailed and lengthy submissions explicitly on behalf of Opt-Out
Institutions in relation to both the August 18 Ruling and the September 23 Ruling.
Moreover, in its submissions in relation to these Rulings, the AUCC never argued
that the Board did not have jurisdiction to make orders affecting Opt-Out
1 The AUCC member institutions that do not operate under the interim tariff elnterim Tariff') are .referred
to as the IIOpt-Out Institutions". '
,....'.
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Institutions, or that the Opt-Out Institutions could not be compelled to answer
Interrogatories without the Board first establishing the elements of third party
discovery.
5. It is noteworthy that, at the time the August 18 and June 6 Rulings were made, the only
Opt-Out Institutions that existed were those AUCC members who say they opted out of the
Interim Tariff as of January 1, 2011 (the uJanuary 1 Opt-Out Institutions") (since at the time
these Rulings were made, these were the only AUCC Institutions that had opted-out). Clearly,
when the August 18 and June 6 Rulings were issued by the Board, the AUCC represented the
Institutions who did not opt-out until September 1, 2011 (the "Sep1ember 1 Opt-Out
Institutions"). The Applicants, therefore, have no basis for claiming procedural unfairness with
respect to the September 1 Opt-Out Institutions.
6. Contrary to the Applicants' submissions on these judicial review applications, the record
before the Board clearly demonstrates that all AUCC institutions outside Quebec have been
represented by the AUCC at all times in the Tariff Proceeding. There is accordingly no merit to
the argument that there was a failure of procedural fairness in respect of the January 1 opt-Out
Institutions based on the claim that these Institutions were not heard by the Board.
7. The ,?oard's procedures do not permit oral or documentary discovery - thus) the
interrogatories process is the only method for obtaining evidence relevant to the Proposed
Tariff. As master of its own procedures, the Board is entitled to control the interrogatories
process in a manner that furthers its parliamentary mandate to certify tariffs. The Board is also
entitled to judicial deference from courts on judicial review of its determinations of relevance and
proportionality, with respect to its procedural decisions generally, and its decisions regarding
interrogatories specifically.
8. Moreover, by ordering that only a representative sample of January 1 O p t ~ O u t
Institutions answer the Interrogatories, the Board considered the burden on the Institutions and
tailored its order accordingly. Contrary to the Applicants' arguments, the August 18 Ruling
confirming the June 6 Ruling qoes not impose an unreasonable burden on the Opt-Out
Institutions for the following reasons:
(a) the only AUCC members that are affected by the outcome of the 339 Appl.ication
are the January 1 Opt-Out Institutions. T ~ e Applicants. cOrlcede (at para. 48 of
their Memorandum of Fact and Law C1Applicants'. Memorandum") that the
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September 1 Opt-Out Institutions have already answered the Interrogatories and
a representative sample of these Institutions will rectify any deficiencies in their
responses; and
(b) the Board ordered in the August 18 and June 6 Rulings that only a representative
sample of the January 1 Opt-Out Institutions is required to answer the
Interrogatories. Just two January 1 Opt-Out Institutions - Brandon University and
Campion College - are included in the representative sample of Opt-Out
Institutions. These are the only two AUCC members that are required to answer
the Interrogatories, and the only AUCC Opt-Out Institutions that are affected by
the August 18 Ruling (or June 6 Ruling for that matter).
Affidavit of Steve Wills sworn October 6, 2011 ("Wills Affidavit (A-339w11 )ll),
para. 30, Applicants Record (liAR"), Vol. 2, pp. 53-54.
9. Therefore, the 339 is really only about whether two AUCC member
lnstitutions - Brandon University and Campion College - must answer the Access
(nterrogatories. Moreover, the Board has only ordered that these institutions make l'reasonable
inquiries" and provide a ureasonable amount of relevant information". To date, they have
provided none at all.
10. The other issues raised by the Applicants in relation to the August 18 Ruling (set out in
paragraphs 1 (8) through 1 (0) of the Notice of Application in the 339 Application) - Le.,
statements made by the Board about the potential consequences if an Opt-Out I nstitution does
not comply with the 6 and _answer the Access Copyright Interrogatories - do not
constitute I'decisions" of the Board, let alone final decisions, and are not The Board
expressly retained jurisdiction to hE?ar submissions at a later date about the matters addressed ..
in these statements. There was no pre-judging by the Board of matters addressed in these
statements I nor is there any evidence of bias as alleged by the Applicants. The Applicants are
bootstrapping these nO'n-decisions onto what was merely a confirmation by the Board of its
earlier June 6 Ruling in an attempt to construe the August 18 Ruling as a new and stand-alone
"decision" subject to review. These "grounds" for review are, clearly, red-herrings, not subject to
review and a waste of this Honourable Courfs time.
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The September 23 Ruling
11. With respect to the September 23 Ruling, which is the subject of the 395 Application, this
too is an interlocutory decision of the Board and there are no special or exceptional
circumstances for departing from the rule that judicial review should not, generally, be granted
with respect to an interlocutory decision of a federal board. As the Board stated in its September
23 Ruling, even though Access Copyright has applied for a tariff that offers only a blanket
licence based on a set sum of money per academic year per full time equivalent C'FTE")
student, it is open to the Board in its final decision to set royalties according to any reasonable
formula it chooses, including one based on the number of copies made. It is still possible that
the final tariff C'Final Tariff") certified by the Board will provide for transactional licences and
accordingly the 395 Application is premature, providing another reason why it must wait to be
heard until after the Board issues'a Final Tariff.
12. In the alternative, the September 23 Ruling is correct, certainly reasonable, and should
not be set aside. The Board's September 23 Ruling sets out in detail the bases for its decision
denying the AUCC's application to amend the Interim Tariff. Several of these reasons amounted
to findings of fact (due substantial judicial deference) regarding the administrative costliness and
impracticality of the Applicants' proposal, the lack of credibility of the Applicants' submissions,
and an assessment of the balance of convenience favouring Access Copyright. Additionally,
one of the objects of the Copyright Act is to ensure that rights holders get paid for protected
uses of their works. The 1nterim Tariff does not prevent Institutions from making alternative
arrangements such as source licensing or using works that are not in the repertoire of Access
Copyright. The Board recognized in the September 23 Ruling that for the Institutions, the Interim
Tariff is an option, not an imposition. Moreover, the Applicants raise several issues here for the
first time on judicial review that could have been - but were not - raised before the Board.
13. Access Copyright requests that this Honourable Court dismiss the 339 and 395
Applications, with costs as against the Applicants.
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PART I .. STATEMENT OF FACTS
Background
14. Access Copyright is a collective society within the meaning of sections 2 and 70. 1 of the
Copyright Act; it administers the reproduction rights of publishers and authors, and collects fees
and grants licences for such rights in Canada in relation to works in its repertoire. Starting in
1994, Access Copyright and members or the AUCC outside Quebec entered into licence
. .
agreements which permitted the I nstitutions to reproduce published works in Access Copyright's
repertoire onto paper. These licences, which were based on a model licence agreement,
. negotiated between the AUCC and Access Copyright (the "Model Licence"), expired on
December 31',2010.
15. On March 31, 2010, Access Copyright filed a Proposed Tariff that covers the copying of
works in its repertoire by Po.st-secondary institutions in Canada, outside Quebec. In accordance
with section 70.14 of the Copyright Act, the Board published the Proposed Tariff in the Canada
Gazette on June 12, 2010 giving notice to prospective users and their representatives that any
objections to the Proposed Tariff were to be filed by August 11,2010.
16. The AUCC filed an objection to the Proposed Tariff on July 15, 2010. The AUCC's
objection letter stated:
AUCC hereby objects to the provisions of the [Proposed Tariff) on behalf
of its members located in Canada outside the Province of Quebec.
ALJCC is the voice of Canada's Universities. AUCC represents 95
Canadian public and private not-for-profit universities and university-
degree level colleges. Of the 95 universities and colleges, 77 are located
in Canada outside Quebec. [Emphasis added]
Wills Affidavit (A-339-11), Ex. j'B" I AR, Vol. 2, p. 66.
17. The AUCC was granted objector status in the Tariff Proceeding based on its July 15,
2010 and representation that it was objecting on behalf of its 77 members located
outside Quebec.
18. On October 7, 2010, Access Copyright applied for an interim tariff to take effect from
January 1,2011 to the date a Final Tariff is certified by the Board. By letter dated December 10,
2010, the AUCC opposed Access Copyright's application for an interim tariff. On December 23,
2010, the Board issued an interim tariff ("Interim Tariff') in effect from January 1, 2011 until the
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date the Final certified. The Interim Tariff established a royalty based on a fee per FTE
student, with per page rates for copies of published works made for the purpose of course
collections that are sold to students. The I nterim Tariff also provided an optional licence for
digital copying.
December 10, 2010 letter, Affidavit of Shallyn MacOonald sworn
November 4, 2011 ("MacDonald Affidavit"), Ex. "G", AR, Vol. 4, p. 581.
December 23, 2010 Board Decision, Wills Affidavit (A-339-11), AR, Vol. 2,
pp. 107 et ft.
19. The royalties sought in the Proposed Tariff and provided for in the Interim Tariff are in
the form of a blanket licence covering all copying by a post-secondary institution ("lnstitutionlJ).
In its decision issuing the Interim Tariff, the Board stated that the main objectives of the Interim
Tariff were, inter alia, to provide certainty to targeted lnstitutions by informing them of what they
mayor may not do using Access Copyright's repertoire starting January 1, 2011; and to
maintain the status quo to the extent possible under the Model Licence.
December 23, 2010 Board Decision, Wills Affidavit (A-339-11), AR, Vol. 2,
pp. 107 et ft.
20. Steve Wills, a lawyer who holds the position of Manager, Government Relations and
Legal Affairs at the AUCC
1
was cross-examined on his two affidavits filed in the 339 Application
and 395 Application. He that the AUCC .applied for objector status in the Tariff
Proceeding on behalf of all 77 AUCC members outside Quebec. He also testified that nowhere
in any of the AUCC's correspondence to the Board in the Tariff Proceeding (including
correspondence sent by the AUCC in relation to the August 18 Ruling and the September 23
Ruling) did the AUCC advise the Board that the AUCC did not represent the Opt-Out
Institutions. The AUCC only once stated that it did not represent the Opt-Out Institutions, and
this was in its objections to the Access Interrogatories, provided to Access Copyright (as
described below in paragraphs 22 to 24).
Wills Cross-examination, AR, Vol. 6, Tab 10, Qs 109-10, 126-29, 14042, 145-
46,176-77,229,269-70.
The June 6 Ruling
21. The BoardJs Directive on Procedure in the Tariff dated March 16
1
2011 (the
jjOirective") does not provide for documentary or oral discovery. Instead. the Directive provides
a process whereby partiCipants in the Tariff Proceeding exchange interrogatories. The
interrogatories are not filed with the Board. If a participant objects to answerinQ an interrogatory
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posed by another participant, and the objection cannot be resolved by the concerned
participants, only then does that interrogatory get filed with the Board.
Copyright Board of Canada, Model Directive on Procedure, dated March 16,
2011, Applicants' Book of Authorities (UABA"), Tab 10.
22. The AUCC objected to certain interrogatories served on it by Access Copyright. Only
Question 3 of the Access Interrogatories is at issue in the 339 Application. Question 3 asked:
Q. Identify all parties that the Objector represents in the Tariff (each, an
II I nstitution").
23. In their objection to Q. 3 provided to Access Copyright, the AUCC and the Association of
Canadian Comm unity Colleges ('IACCClJ) stated:
Objection
AUCC and ACCC represent in this hearing their members located in
Canada outside Quebec who are operating pursuant to the licence
conveyed by the Interim Tariff. AUCC and ACCe object to having to
secure answers to this interrogatory from their members located outside
Quebec who have decided to only make Copies of Published Works with
the permission of the copyright owner other than through the Interim
Tariff, or with other legal justification, e.g. fair dealing. The Proposed
Tariff does not apply to these members. [ ... ]
MacDonald Affidavit, Ex. "An I Appendix B, AR, Vol. 4, p.462.
24. Access Copyright wrote to the Board on April 19
1
2011 to seek a determination from the
Board on the objections to Interrogatories of the AUeC and ACeC, including whether the
objection to Q. 3 should be upheld; and in doing so, the objection by the AUCC and ACCC was
provided to. the Board by Access Copyright. The Board issued the June 6 Ruling on the
Interrogatories to which the AUCC and ACCC had objected, including Q. 3. The Board ruled:
General comment: the volume of information Access requests is largely
a result of the breadth of issues raised by the objectors. That being said,
parties are reminded that the Board does not need all existing relevant
information to set fair tariffs. The should provide a
reasonable amount of relevant information, from a reasonable number of
institutions, preferably identified with the concurrence of Access. The
institutions will in turn be required to make reasonable inquiries from
staff.
Q. 3/3: the objection is dismissed. Information concerning institutions
that do not avail themselves of the interim tariff is relevant and shall be
provided, subject to the general comment aQove. Institutions who resist
providing information should be reminded of the Board's powers
. pursuant to subsection 66.7(1) of the Copyright Act.
June 6 Ruling, Wills Affidavit (A-339-11), Ex. uJ", AR, Vol. 2, p. 332.
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The August 18 Ruling
25. The AUCC never sought judicial review of the June 6 Ruling.
26. The AUCC and ACee were to provide their answers to Interrogatories by a deadline
specified by the Board. They failed to provide any answers from Opt-Out Institutions and on July
20, 2011 Access Copyright wrote to the Board referring to the June 6 Ruling, pointing out that
the AUee and Aeee had failed to provide answers to Interrogatories from any January 1 Opt-
Out Institution and requesting:
[ ... J that the Board issue an effectively confirming its June 6 - order:
(i) requiring the AUeC and AGCe to provide complete answers to the
interrogatories from a representative sample of the institutions on
Schedule 'IA
U
developed in consultation with Access Copyright in
compliance with the June 6 Ruling, or, alternatively;
(ii) the Board exercise its powers under section 66.7(1) of the Copyright
Act to require that the institutions listed on Schedule "AI! [the attached list
of January 1 Opt-Out Institutions] answer and produce for inspection all
of the documentation that is responsive to the interrogatories.
Access Copyright's July 20, 2011 letter to the Board, Wills Affidavit (A-339-
11), Ex. UK", AR, Vol. 2, p. 337.
27. The AUCe's letter dated August 2t 2011 filed with the Board in response to Access
Copyright's July 20
1
2011 letter, commences, IIWe are writing to you on behalf of the Association
of Universities and of Canada [ ... ]" Nowhere in the AUeC's letter does it state that the
AUCe does not represent the Opt-Out Institutions. Nowhere in the letter does the AUee state
that the Board does not have jurisdiction to make an order that the Opt-Out I"nstitutions answer
the Interrogatories. In fact, the AUCC's submissions opposing Access Copyrighfs request that
the June 6 Ruling be enforced include more than two pages of detailed arguments opposing
having the Opt-Out Institutions answer the Interrogatories.
August 2, 2011 AUCC letter, Wills Affidavit (A-339-11), Ex. "L", AR, Vol. 2,
pp. 344 and 351-53.
28. The Board issued its August 18 Ruling, again ordering the AUCC and Aeee to provide
answers to Interrogatories from a representative sample of the Opt-Out Institutions: The August
18 Ruling stated, in part:
The application for an order allowing Access to obtain information from
institutions that do not avail of the interim tariff (the "opt-out
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institutionsll) is granted. The June 6) 2011 rwling is clear: information
concerning these institutions is relevant.
August 18 Ruling, Wills Affidavit Ex. "M", AR, Vol. 2, p. 376.
29. Pursuant to the August 18 Ruling, the parties were to agree on a representative sample
of OptwOut Institutions. Access Copyright negotiated directly with the AUCC regarding which
Opt-Out Institutions should be included in the sample. There was no suggestion
whatsoever from the AUCC or its counsel that counsel for the AUCC was not able to negotiate
on behalf of the Opt-Out Institutions; nor was there any suggestion that Access Copyright
should be negotiating with the OptHOut Institutions directly- because the AUCC did not represent
,the Opt-Out Institutions. Throughout its correspondence with-Access Copyright and the Board,
the AUCC held itself out as authorized to represent the Opt-Out Institutions.
Letter dated September 10, 2011 from counsel for the AUCC to counsel for
Access Copyright, MacDonald Affidavit, AR, Vol. 4. p. 823".
Letter dated September 14, 2011 from counsel for the ACCC (writing on
behalf of the AUCC and ACCC) to counsel for Access Copyright,
MacDonald Affidavit. ARt Vol. 4, p. 837ff.
30. Access Copyright and the AUCC drew a sample of Opt-Out Institutions. Included in the
sample are just two January 1 Opt-Out Institutions (Brandon University and Caf!lpion College).
These are the only AUCC members affected by the August 18 Ruling since the Applicants
concede at paragraph 48 of their Memorandum that the September 1 Opt-Out Institutions
provided answers to the Interrogatories (they had not opted out when the June 6 Ruling and the
August 18 Ruling were mage) and the AUCC does not object to having a sample of the
September 1 Opt-Out Institutions address deficiencies in the responses to Interrogatories that
have been provided by them.
31. The AUCC filed its application for judicial review of the August 18 Ruling on September -
19, 2011. For its part, the Association of Canadian Community Cotteges (ACCC) has not sought
judicial review. The August 18 Ruling was stayed (Access Copyright took no position on the
AUCC's stay motion), and to date, the AUCC has not provided any answers to Interrogatories
from Brandon University or Campion College.
The September 23 Ruling
32. The application for judicial review in the 395 Application relates to the _Board's decision
,dismissing the AUCC's application to B:mend the Interim Tariff. AUCC filed an application
on June 8, 2011 to amend the Interim Tariff to require Access Copyright to g'rant transactional
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. licences to its members on a per copy basis. Nowhere in its application to amend the Interim
Tariff does the AUCC state it is not representing the Opt-Out Institutions. Indeed, the AUCC
. .
filed evidence obtained from some of its members who had opted out on January
1, 2011, and made extensive arguments as to why the Board should amend the Interim Tariff to
allow any Opt-Out Institution to demand and obtain a transactional licence - i.e., a one-time
licence for a one-time use of a work in Access Copyright's repertoire.
AUCC Application to Amend Interim Tariff, Affidavit of Steve Wills sworn
November 22, 2011 ("Wilts Affidavit (A
w
395-11}"), Ex. "e", AR, Vol. 5, p.
882ft.
33. In effect, the AUCC the Board to graft onto the Interim Tariff a right for Institutions
- including Opt-OLit In'stitutions who were therefore not paying the FTE rate under the Interim
Tariff - to demand a transactional from Access Copyright for paper and/or digital copies.
Since at least 2004, Access Copyright has never issued a transactional licence to Institutions for
paper copies that fall within the limits of the Model Licence. What the AUCC was seeking would
change the status quo ante for paper. Similarly, with respect to digital copying, Access
Copyright had only issued digital transactional licence to Institutions that had signed the Model
Licence.
AUCC Application to Amend Interim Tariff, Wills Affidavit
Exhibit "C", AR, Vol. 5, p. 882.
Access Copyright Reply, Wills Affidavit (A-395-11), Exhibit "I") AR, Vol. 5, p.
1003. .
34. In its reasons dismissing the AUCC's application, the Board set out 10 different grounds
for its decision, including:
(a) once a tariff is in place, a collective should be entitled to rely on it.
when a collective opts for a tariff, it is in part to avoid the costs associated with
transactional dealings. Such a course of conduct is rational and fair (para. 16);
(b) the Interim Tariff seeks to reflect the status quo to the extent possible and is
reasonable. The agreements the tariff replaced were "take it or leave if' licences.
Therefore, the "take it or it" nature of Access Copyright's dealings cannot of
itself justify changing the status quo (paras. 11-14);
(c) transactional licen'ces inherently raise monitoring issues, especially in such a
decentralized setting as the Institutions. These issues. are compounded. with
digital copying (paras. 21-24);
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(d) the administration of transactional licences tends to be cost intensive (para. 25);
(e) atlowing transactional licences under the Interim Tariff could lead Institutions into
a false sense of security. If the Final Tariff provides only for an FTE rate as
Access Copyright has requested, any Institution that availed itself of an interim
transactional licence will be liable for the full FTE price unless the Final Tariff
provides otherwise (para. 30); and
(f) the Board's power to vary a tariff is broad and even though Access Copyright
applied for a tariff that offers only the FTE licence, it will be open to the Board in
its final decision to set royalties according to any reasonable formula, including
one based on the number of copies made (para. 33).
September 23 Ruling, Wills Affidavit (A-395-11), Exhibit irA", AR, Vol. 5, p.
855-61.
PART II - POINTS IN ISSUE
35. Access Copyright submits that the following issues are the principle issues raised by the
Applications and that a response in the negative to these questions requires rejection of the
Applications:
(a) in relation to the August 18 Ruling and the September 23 Ruling, whether there
are any special or exceptional circumstances for departing from the rule that
judicial review should only be granted for a final decision(s) of a federal board,
here the Copyright Board?
(b) in relation to the August 18 Ruling, whether the application for judicial review of
the August 18 Ruling should be considered by this Honourable Court given that it
is out of time because the Ruling merely confirms the June 6 Ruling, in respect of
which no application for judicial review was ever filed by the Applicants?
36. Should this Honourable Court respond in the affirmative to either of the above questions,
in response to the issues as stated by the Applicants at paragraphs 58 and 59 of the Applicants'
Memorandum, Access Copyright submits that:
(a) the August 18 Ruling (and the June 6 Ruling) and the September 23 Ruling were
correct, and certainly were reasonable having regard to the circumstances and
the deferentia,1 standard of review due to the Board's decisions;
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(b) the Board did not exceed its authority under the Act by requiring the January 1
Opt-Out Institutions to answer the Interrogatories;
(c) the Board was correct, and certainly reasonable, to require January 1 Opt-Out
Institutions to answer the Interrogatories, a decision due the greatest deference
as a matter involvir}g procedural and evidentiary findings:
(i) the Board's decision properly took into account sections' 66.7(1) and
70.15 of the Act;
(ii) the Board's decision was properly tailored to avoid imposing an
unreasonable burden on the January 1 Opt-Out Institutions since only a
representative sample (two Institutions) is required to answer the
Interrogatories, and they are only required to conduct lI reasonable
inquiries" and provide a "reasonable response"; and,
(iii) the Board's decision did not constitute an order for Uthird-party' discovery
since the Opt-Out Institutions were at all times represented by the AUCC
in the Tariff Proceedings, are prospective users under the Final Tariff and
there is no reason to believe that the Board did not consider third party
discovery UrequirementsJJ;
(d) the Board's statements at paragraphs (6) to (8) of the August 18 Ruling were
proper and, in any event. the statements manifest no (pre}determination (the
...
Board has expressly retained jurisdiction to hear submissions at a later date
about the matters addressed in these statements) and are irrelevant to the
Application.
37. In relation to the September 23 Ruling, there is no real error of law alleged by the
Applicants grounded in the text of the Act, the sufficiency of the Board's reasons or its exercise
of discretion - the Applicants merely dislike the r e s u l ~ the Board reached, principally on findings
of fact, that differed from the result sought by the Applicants. Contrary to the Applicants'
arguments:
(a) the Board's decision is consistent with and takes into account the statutory
context and purpose of the Act;
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(b) the Board properly, i.e., both correctly and reasonably, understood the purposes
of providing interim relief under section 66.51 of the Act; and
(c) the ruling is consistent with earlier decisions of the Board that the Interim Tariff is
voluntary and will not impair alternative-licensing mechanisms.
38. In the alternative, if the Court finds that the Board committed any reviewable error, the
only appropriate remedy is a remand for further consideration of the decision with regard to the
relevant issue(s).
PART III - SUBMISSIONS
Standard of Review
A. The Board's lega/ conclusions may only be overturned if unreasonable
39. The Applicants submit and the Respondent agrees that the standard of review of both
the August 18 Ruling and the September 23 Ruling of the Board is II reasonableness" . The
Applicants, however, fail to provide the court a description of this standard
l
the jjguiding
principle
ll
of which (the Supreme Court of Canada has emphasized) is deference.
When reviewing a decision of an administrative body on the
reasonableness standard, the guiding prinCiple is deference. Reasons
are not to be reviewed in a vacuum - the result is to be looked at in the
context of the evidence, the parties' submissions and the process.
Reasons do not have to' be perfect. They do not have to be
comprehensive. [emphasis added]
Newfoundland and Labrador Nurses' Union v. Newfoundland and Labrador
(Treasury Board), 2011 sec 62 (IINewfoundland Nurses!!) at para. 18
[citation omitted], Access Copyright's Book of Authorities ("ACBA"), Tab 1.
40. I n Dunsmuir v. New Brunswick, the Court described the reasonableness standard thusly:
Reasonableness is a deferential standard animated by the principle that
underlies the development of the two previous standards of
reasonableness: certain questions that come before administrative
tribunals do not lend themselves to one specific, particular result.
Instead, they may give rise to a number of possible, reasonable
conclusions. Tribunals have a margin of appreciation within the range of
acceptable and rational solutions. A court conducting a review for
reasonableness inquires into the qualities that make a decision
reasonable, referring both to the process of articulating the reasons and
to outcomes. In judicial review, reasonableness is concerned mostly with
the existence of justification, transparency and intelligibility within the
decision-making process." But it is also concerned with whether the

decision falls within a range of possible, acceptable outcomes which are
defensible in respect of the facts and law. [emphasis added]
Dunsmuir v. New Brunswick, [2008] 1 SCR 190 (II Dunsmuir") at para. 47,
ABA, Tab 1.
41. The Court has explained in subsequent decisions that the review is an "organic exercise
- the reasons must be read together with the outcome and serve the purpose of showing
whether the result falls within a range of possible outcomes)}, The adequacy of a board's
reasons is not by itself a sufficient basis for quashing the board's decision. H[C1ourts should not
substitute their own reasons, but they may, if they find it necessary. look to the record for the
of assessing the reasonableness of the outcome,1I
Newfoundland Nurses at paras.
B. The Board#s procedural determinations are entitled to deference as the Board is
master of its own procedures
42. Access Copyright submits that when the Federal Court of Appeal looks to the actual
record here (as opposed to the Applicants' selective arguments), both of the Rulings are.
acceptable outcomes that reflect a correct - and certainly a reasonable - interpretation of the
facts and the law. As discussed more fully below, Federal Court case law affirms that deference
to administrative decisions is at its highest when procedural matters are at issue: U[t1he
jurisprudence establishes, as a general rule, that administrative agencies are masters of their
own procedures as long those procedures respect the principles of procedural fairness." Here,
of course, the Applicants raise only one issue of procedural fairness: the contention being made
for the first time in these judicial review proceedings that Opt-Out Institutions should have been
heard, in addition to their representative the AUCC, in relation to the August 18 Ruling. The
Applicants have made no suggestion that the Board ever denied the AUeC, the ACee, or any
Institution that wished to be heard an opportunity to make submissions on any decision
challenged now.
Coupal v. Canada (Attorney General), 2006 FC 255 at para. 27, ACBA, Tab 2.
See also Bell Canada v. Canadian Telephone Employees Association, 2001
FCA 139 at para. 5, ACBA, Tab 3.
- 16-
c. The Board1s findings of fact are entitled to deference unless they are capricious or
perverse
43. Findings of fact are not easily set aside by courts in hindsight. Thus, the Federal Court of
Appeal has held:
On an application for judicial review I the role of the Court with respect to
a tribunal's findings of fact is strictly circumscribed. In the absence of an
error of law in a tribunal's fact-finding process. or a breach of the duty of
fairness, the Court may only quash a decision of a federal tribunal for
factual error if the finding was perverse or capricious or made without
regard to the material before the tribunal: FederaJ Court Act, paragraph
18.1(4)(d). Hence, if, as a result of an error of law. a tribunal has omitted
to make a relevant finding of fact. including a factual inference. the
matter should normally be returned to the tribunal to enable it to
complete its work. [emphasis addecU
Canada (Minister of Human Resources Development) v. Rafuse
t
2002 FCA
31 at para. 13, ACBA, Tab 4.
D. The Board's decisions should not be overturned based on arguments that could
have been but were not presented to the Board
44. The Supreme Court of Canada recently ruled that udiscretion wi,1I not be exercised in
favour of an applicant on judicial review where the issue could have been but was not raised
before" the administrative body, offering several rationales I including: (a) the administrative
body's "specialized functfons or expertise"; and (b) doing so IImay unfairly prejudice the
opposing party and may deny the court the adequate evidentiary record reqUired to consider the
issue",
Alberta (Information and Privacy Commissioner) v. Alberta Teachers'
Associations, 2011 SCC 61 at paras. ABA, Tab 2.
The Decisions are Interlocutory and Not Ripe for Review
45. It is settled law that unless there are IIspecial circumstances"! courts should not conduct
judicial review of an interlocutory decision of a federal board. A decision will be considered
reviewable and not interlocutory where it is IIfinally dispositive of a substantive right of a party,
the factor being whether the damage done by the interlocutory decision can later be
corrected" .
Szczecka v. Canada (Min. of Employment & Immigration) (1993), 116 D.L.R.
(4th) 333 (Fed. C.A.) at para. 4, ACBA, Tab 5.
Cosgrove v. Canada '(Attorney General), 2008 Fe 941 at para. 31, ACBA,
Tab 6.
- 17 -
46. The Applicants argue that the August 18, 2011 Ruling is not interlocutory because it is a
final determination of the obligations. of Opt-Out Institutions to provide answers to Access
Copyrightls Interrogatories. In fact the Applicants claim that the August 18 Ruling uraises issues
that are jurisdictional in nature about the Board's authority to reach beyond the parties to a tariff
to impose discovery requirements ... "
Applicants' Memorandum, AR, Vol. 8, at para. 63.
47. As a preliminary point, this casual reference to jurisdictional error is reflective of the
generally inflammatory nature of the arguments made in the Applicants' Memorandum (the
Applicants have also accused the Board of acting IIblindly", in a biased manner and in rlcavalier
disregard
ll
of the consequences of its decisions). If the Applicants are sincerely claiming that the
Board exceeded its jurisdiction in issuing the August 18 Ruling, then they should forthrightly say
so and argue that the proper standard of judicial review is correctness, not reasonableness.
Their reference here and elsewhere in their factum to the Board exceeding its jurisdiction is an
attempt to suggest a more favourable standard of review without establishing that it applies.
Applicants' Memorandum at paras. 10, 61, 63, 77, 78, 90.
48. Even assuming that the Opt-Out lnstitlJtions should be characterized as Uthird parties"
because they did not object to the Proposed Tariff qua institutions, and, thus, the August 18
Ruling raises jurisdictional issues, the Applicants have not shown that this constitutes a special
circumstance warranting interlocutory review. In fact, the Federal Court of Appeal. has held that
the presence of a jurisdictional issue is not an exceptional circumstance allowing judicial review
before the administrative process has been completed.
Canada (Border Services Agency) v. C.B. Powell Limited, 2010 FCA 61
at para. 33, ACBA, Tab 7 rthe authorities show that very few
circumstances qualify as "exceptional" and the threshold for
exceptjonality is high [ ... ] the presence of so-called jurisdictional issues is
not an exceptional circumstance justifying early recourse to courtsll) and
para. 45 C'courts all across Canada have repeatedly eschewed
interference with intermediate or interlocutory administrative rulings and
have forbidden interlocutory forays to court, even where the .
appears to be a so-called 'jurisdictional' issue"}.
49. Paragraphs of the August 18 Ruling are neither a final determination of the Opt-Out
Institution's ri.ghts or obligations nor relevant to this Application (339). While the Applicants have
challenged these paragraphs as "improper enforcement threats and prospective evidentiary
rulings"', .the impact of these statements - none of which constitutes a reviewable (let alone final)
- 18-
"decision" - on the Opt-Out Institutions is entirely dependent on the Opt-Out Institutions' own
choice of actions between now and the Proposed Tariff hearing and, regardless, are
determinative of none of the issues addressed in these paragraphs or the 339 Application.
50. Paragraph 6 of the August 18 Ruling merely confirms Access Copyright's ability to file
with the Board an application limiting the ability of an Opt-Out Institution that does not provide
interrogatory responses to file evidence at the Proposed Tariff hearing absent the Board's leave.
No determination is made by the Board with respect to any such application. Paragraph 7 (self-
evidently) notes that if the Opt-Out Institutions choose not to provide interrogatory responses,
then the Final Tariff certified by the Board might be higher than otherwise, as the record will not
reflect the copying habits of Opt-Out Institutions as accurately as it would if they fully
participated; no determination is made by the Board with respect to this issue. Paragraph 8 of
the August 18 Ruling simply notes that an Opt-Out rnstitution's decision to operate outside the
Interim Tariff will not immunize it from potential liability or an obligation to provide information
under the Final Tariff; no determination is made by the Board with respect to this issue.
51. Paragraph 6 is, at most, a statement by the Board about the evidentiary procedure to be
followed in the Proposed Tariff hearing; it does not affect the rights or obligations of any party. A
statement regarding evidentiary procedure or the admissibilit,y of evidence before the actual
hearing on the merits is not a type of "special circumstance" in which judicial review is permitted.
The Federal Court of Appeal has specifically explained:
Rulings made by a Tribunal panel on the admissibility or compellability of
evidence should not be the subject of such applications until the panells
proceedings are completed. This principle, as the cases have indicated,
is based on the fact that the parties cannot know until the end of the
proceeding whether a review of a particular interlocutory decision will be
necessary; and on the fact that the inconvenience of the delay involved
far outWeighs any value in an early review.
Bell Canada v. Canadian Telephone Employees Association, 2001 FCA 139
at para. 5, ACBA,. Tab 3. See also Canada (Min. of Citizenship &
Immigration) v. Varela, 2003 FCA 42 at paras. 3-5, ACBA, Tab 8 (finding
premature an application for judicial review of a decision on a point of law
~ e a l i n g with evidence).
52. Paragraphs. 7 and 8 of the August 18' Ruling do not have any effect on the Opt-Out
Institutions' rights or obligations -' they are merely obiter dicta by the Board discussing
hypothetical situations. It is well established that statements with no impact on parties' rights
cannot be the subject of judicial review. Moreover, even assuming that these statements are
taken to be evidence of bias - as the Applicants speculate without any evidence in support of
- 19 -
this startling allegation - an of non-systemic bias does not qualify as ':special
circumstances" justifying immediate judicial review.
Sanaf; Pasteur Ltd. v. Canada (A. G.} (2008), 2008 Fe 286 at paras. 48-52
1
ACBA, Tab 9.
53. Finally, with respect to the September 23 Ruling, the Applicants claim that they win not
be able to apply for judicial review of this decision if they have to await the Fi.nal Tariff
certification. However, the very question may become moot by the ultimate decision of the
Board in the Tariff As the Board explained in the September 23 Ruling, "it wil1 be
open to the Board in its final decision to set royalties according to any reasonable formula it
chooses, including one based on the number of copies made
l'
, Importantly, it will also be open
to the Objectors to argue that a transactional-based tariff is the proper one.
Wills Affidavit (395-11), Ex. "A" I AR, Vol. 5, Tab 8A, para. 33.
54. Moreover, 16 of the Opt-Out Institutions say they have been operating outside the
Interim Tariff since January 1, 2011, and 21 say they have been doing so since September 1,
2011. They have seemingly done so without a need for transactional licences (as was the case
before the Interim Tariff became effective on January 1 t 2011). The Opt-Out Institutions will
suffer no prejudice if they continue to wait until the Board issues its decision regarding the
Proposed_ Tariff. At that time, they (and this court) will be in a better position to assess all the
facts, legal issues, and consequences facing the Opt-Out Institutions.
Hurst Cross-examination, AR, Vol. 6, Tab 9, Qs. 336-40.
Wills Cross-examination, AR, Vol. 6, Tab 10, Qs. 178-81,348-53,359.
Judicial Review of the August 18 Ruling is Time .. Barred
55, The Board's June 6 Ruling contained the Board's -decision regarding whether Opt-Out
Institutions should be required to respond to the Interrogatories (the focus of the 339
Application). In that decision, the Board found that the large volume of information requested by
Access Copyright in the Interrogatories was due to the issues raised by the objectors, that the
information from Opt-Out I nstitutions was relevant, and that the parties should be able to
negotiate a reasonable amount of information from a reasonable number of Institutions, which
would make reasonable inquiries of their staff. As stated by Mr. Wills in his affidavit and
confirmed by the Applicants at paragraph 48 of their Memorandum, those AUCC members who
subsequently became the September 1 Opt-Outs have already answered the Interrogatories
- 20-
and the Applicants concede that a representative sample of them will correct any deficiencies in
their answers. The sample of January 1 Opt-Out I nstitu1ions contains only two Institutions,
randomly selected, demonstrating that the Board's finding was more than reasonable.
Wills Affidavit (A-339-11), para. 30 and Ex. "J", AR, Vol. 2, pp. 53-54 and
332.
56. The August 18 Ruling contains no new findings or conclusions of law regarding the
propriety of requiring answers from the Opt-Out Institutions. It merely provides deadlines for the
parties to agree on which Opt-Out Institutions will be required to answer the I nterro.gatories , a
timetable for answers, and a joint letter to the Opt-Out Institutions describing the consequences
of not answering, as well as the Board's own statements in paragraphs 6-8 regarding
consequences of ignoring the Ruling.
Wills Affidavit (A-339-11), Ex. uM", AR, Vol. 2, p. 376.
57. The Applicants did not apply for judicial review of the June 6 Ruling within 30 days as
required by Rule 18.1 (2) of the Federal Courts Act, or at all. Nor did the Applicants bring a
motion seeking an extension of time. Moreover
1
even though the AUCC was keeping the Opt-
Out Institutions apprised of developments with the Board, none of the Opt-Out Institutions
objected.
Wills Cross-examination, AR, Vol. 6, Tab 10, "Qs 50-52.
Section 18.1(2), Federal Courts Act, R.S.C. 1985, c F-7
58. There is no evidence before the Court as to the reason why the Applicants neglected to
file an application for judicial review within the time period for the June 6 Ruling. Indeed,
AUCC's affiant in support of its applications Steve Wills (Manager, Government Relations and
Legal Affairs) does not accurately describe the nature of the June 6 Ruling in his affidavit, and
the Applicants omit any mention of the June 6 Ruling at all from their Memorandum.
Wills Affidavit (A-339-11), AR, Vol. 2, p a r a ~ 22; Applicants' Memorandum at
paras. 41-42.
59. Case law here is clear - a courtesy response of a federal board affirming an earlier
decision does not extend the time for seeking judicial review, unless the board has explicitly
agreed to reconsider its decision on the basis of new facts and issue a new one.
See Dumbrava v. Canada (Minister of Citizenship and Immigration), [1995]-
F.C.J. No. 1238, 101 F.T.R. 230, at para. 15, ACBA, Tab 10.
- 21
60. The Applicants have not alleged that the Board's August 18 Ruling constituted a
reconsideration of its June 6 Ruling. Indeed, it was Access Copyright who wrote to the Board to
inform it that the AUCC and ACeC had not yet filed any answers from Opt-Out Institutions and
requesting the Board order the AUCC and ACeC to comply with the June 6 Ruling.
Wills Affidavit Ex. 'K", AR, Vol. 2, pp. 340-41.
61. In its response to Access Copyright's 60mplaint to the Board about the AUCe and
ACCC's non-compHance with the June 6 the AUCe submitted tlthat it has complied with
the [June 6] Ruling [ ... because] [i]t has provided a vast quantity of relevant information from
more than a reasonable number of AUCe members ... " But the AUCC never asks the Board to
formally reconsider or revisit its -June 6 Ruling. It certainly never raises the argument that the
Board's June 6 Ruling is deficient because it does not 'contain a full-fledged analysis of the
propriety of third-party discovery or that the Board lacked jurisdiction over the Opt-Out
Institutions. On cross-examination, Mr. Wills admitted that the AUCC did not write to the Board
in response to Access Copyright's request to enforce the June 6 Ruling for the purpose of
advising the Board that the AUCC would not be providing any responses from Opt Out
Institutions or for the purpose of contesting the Board's jurisdiction over such Institutions.
Wills Affidavit Ex. HL", AR, Vol. 2, p. 352. Wills Cross-
examination, AR, Vol. 6, Tab 10, Qs 275-77, 280-81,284,292-95,318-20.
62. The text of the August 18 Ruling confirms that the Board's ,focus was determining
compliance with the June 6 Ruling, not reconsidering its findings and conclusions on the merits.
The Board writes: liThe June 6, 2011 ruling is clear". The Board does not reference or rely on
any new arguments on the issue by the parties, nor does it supplement or vary its reasons.
Accordingly, Applicants are barred from challenging the Board's decision that the Opt-
Out Institutions must respond to the Interrogatories.
Wills Affidavit (A-339-11), Ex. "Mil, AR, Vol. 2, p. 376.
In the Alternative, the August 18 Ruling and the September 23 Ruling Are Correct. and
Certainly Reasonable
A. 18 Ruling
63. The August 18 Ruling was manifestly a procedural decision. As a matter of standard of
review, the Courfs deference is at its highest with respect to procedural decisions of
administrative bodies. Access Copyright submits .that the Board correctly, and certainly
- 22-
reasonably, found that the Opt-Out Institutions were prospective users, indeed participants,
under the Proposed Tariff proceeding (and, thus, not third parties). Even if the Opt-Out
Institutions are considered to be third parties, the Board reasonably found that their evidence
was relevant and the interrogatory responses sought would not impose an unreasonable
burden. Finally. the Board's decision was in furtherance of its mandate under section 70.15 to
certify proposed tariffs and well within its procedural powers under section 66.7(1) to make
orders unecessary or proper for the due exercise of its jurisdiction" 'under section 70.15. This
was a correct, and certainly a reasonable, interpretation of the Board's procedural powers under
the Copyright Act.
i. The Opt-Out Institutions were represented by the AUCC
64. It is clear that the Opt-Out Institutions have been represented by the AUCC throughout
the Tariff Proceedings. First, Mr. Wills testified under cross-examination that the AUCC through
either its internal staff or external counsel kept all its member Institutions informed of the Tariff
Proceeding and coordinated their responses to the Interrogatories since at least December 23,
2010. To claim now that the Opt-Out Institutions were not represented before the Board when it
made its August 18 Ruling but were uninvolved third parties is, therefore, a mischaracterization
of the record.
Wills AR, Vol. 6, Tab 10, Qs 52-62.
65. Second, Mr. Wills could not, on cross-examination, identify any time that the AUCC
informed the Board that it was not representing those Institutions not operating under the Interim
Tariff (the only such statement appeared once, in the AUCC's April 4,2011 response to Access
Copyright) or that the Board lacked jurisdiction to order the Opt-Out Institutions to respond to
interrogato(ies. Third, while the Applicants claim that that there is some sort of divide between
the AUCC's representation of its members operating within the Interim Tariff and the Opt-Out
Institutions
l
interests, they have not identified any real divergence of interests. In his cross-
examination, Mr. Wills admitted that the AUCC strives to represent all its members' interests.
Interestingly, paragraph 19 of the Applicants' Notice of Application in 1\-395-11 explicitly states
that the application to vary the Interim Tariff was brought by AUCC to the Board on the Opt-Out
Institutions' behalf:
AUCC applied to the Board to amend the interim tariff to provide for
transactional licences because it would be vastly more efficient and
timely to provide for transactional licences than for each opt out
- 23-
institution to make an application to the. Board under Section 70.2 for
each copy of a published work that an opt out institution desires to make.
Wills Cross-examination, AR, Vol. 6, Tab 10, Qs 106, 128, 130-33,
140-42,14547,176-77,198,207,229,259,318-20.
395 Application afpara. 19, AR, Vol. 1, Tab 2.
ii. The Opt-Out Institutions are prospective users under the Final Tariff
66. It is implausible that the Opt-Out Institutions are not prospective users under the Final
Tariff. Christopher Hurst, a representative of Brandon University (a January 1 Opt-Out
Institution) testified at length in his affidavit in support of the 339 Application about Brandon
University's extensive and lengthy (16-year) history of using Access Copyright's repertoire. Mr.
Hurst outlined a handful of measures that Brandon University has taken to try to operate outside
the Interim Tarl.ff. without violating copyright law, but he also explicitly stated that Brandon
University decided to operate outside the Interim Tariff because of the "potential retroactive
liability" should the Final Tariff be certified at a higher rate by the Board. None of this is evidence
that Brandon University did not continue to be a prospective user under the Proposed Tariff
given its extensive history with Access Copyright, and its ability to opt-in to the Tarff during (or
subsequent to) its period of application.
Hurst Affidavit, AR, Vol. 3, Tab 6, paras. 5, 10-18.
67. Mr. Hurst further testified on cross-examination that:
(a) there is an official executive point of contact between Brandon University and
AUCC that allows the latter to keep the former apprised on Copyright Board
proceedings, and although Brandon University did not, itself, file an objection to
the Proposed Tariff, Mr. Hurst knew the AUCC had filed such an objection on
behalf of its members, including Brandon University;
Hurst AR, Vol. 6, Tab 9, Qs 49-50,63-64,80-91,103.
(b) he did not know Brandon University's executives became aware of the
Interrogatories, through the AUCC, when they were issued by Access Copyright
or whether (or when) they became aware of the Board's June 6 Ruling;
Hurst Cross-examination, AR, Vol. 6, Tab 9; Qs 98, 188-91,_ 233,235,238,240-41.
- 24-
(c) he himself personally became aware of Access Copyright's July 20, 2011 request
for the Board t6 enforce its June 6 Ruling lIa few days" after July 20, 2011; and
Hurst Cross-examination, AR, Vol. 6, Tab 9, Qs 246, 251, 254, 260-62.
(d) Brandon Universitis fair dealing policy, a basis for Brandon University's position
'that it need not operate under the Interim Tariff, originated with the AUCC and/or
its legal counsel, demonstrating the intimate involvement of AUCC in the internal
copyright management policy of the Opt-Out Institutions and the unity of interest.
between the AUCC and the Opt-Out Institutions.
Hurst AR, Vol. 6, Tab 9, Qs
68. If the Opt-Out Institutions were not prospective users, then they would disclaim any use
of Access Copyright's repertoire - a position they have consistently refused to take. In these
proceedings, they have brought an application to the Board to amend the Interim Tariff, claiming
that they require transactional licences from Access Copyright because they wish to use works
in its repertoire. In the tariff hearing, the Board will, as !t indicated in its September 23 Ruling,
consider various methods of calculating royalties. If the Final Tariff includes some form of
transactional licence, the Opt-Out Institutions may become users of the Final Tariff even jf such
Institutions claim not to be subject to the Interim Tariff. Of course, as the Final Tariff will be
retroactive to January 1, 2011, even Institutions that obtained a transactional licence (Le., under
the Interim Tariff if this court were to reverse the Board's September 23 Ruling) may still be
subject to the terms of the Final Tariff.
69. Of course, it is also clear that any Opt-Out Institutions not operating legitimately outside
the Interim Tariff (by making just one copy of a published work in Access Copyright's repertoire
without licence from the owner or under a legal exception), would be actual users - not just
prospective users - under the Final Tariff. This reality is apparent in the cross-examination of
Brandon University's representative Mr. Hurst. When asked what steps Brandon University took
to ensure compliance with the copyright laws in the lead-up the expiration of the licence with
Access Copyright on December 31,2010 and the decision to operate outside the Interim Tariff,
Mr. Hurst:
(a) could not identify any changes made by professors to their use of course packs
or class handouts or e-mails of published works to students;
Hurst Cross-examination, AR. Vol. 6, Tab 9, Qs 382-406.
- 25-
(b) could not confirm any monitoring mechanism (or change in monitoring
to verify that published works put in paper course reserves or
electronic course management by professors have been legally obtained;
Hurst Cross-examination, AR, Vol. 6, Tab 9
1
Qs 418-27, 429-32, 436-40, 443-47, 524-30.
(c) could not identify any sanction imposed by Brandon University for any breach of
copyright law or the Institutionls copyright policies by a professor or student
discovered by Brandon University;
Hurst Cross-examination, AR, Vol. 6, Tab 9, Os 548-58.
(d) admitted that Brandon University has no copyright administration or clearance
office and that only he (a librarian with no legal training) is responsible for
copyright clearance advice; and
Hurst Cross-examination, AR, Vol. 6, Tab 9, Qs 2530, 67-69, 73-77.
(e) confirmed that he has never sought legal advice regarding copyright clearance.
Hurst Cross-examinations AR. Vol. 6, Tab 9, Qs 703 .. 04.
70. Brandon University made a last-minute decision to try to operate without a licence and
outside the Interim Tariff and took minimal internal steps to so operate, most of which occurred
after the Tariff became effective (January 1, 2011). The Board was aware, through the AUCC's
submissions, that the January 1 Opt-Out Institutions were attempting to operate outside the
Interim Tariff. It was, therefore, open to the Board to conclude, based on the evidence provided,
that the January 1 Opt-Out Institutions were prospective users of the Proposed Tariff.
Regardless, the annual structure of the Proposed Tariff, notably the ability of Institutions to opt-
in during the period of the Proposed Tariff, is sufficient basis for such conclusion.
Hurst Cros,s-examination, AR, Vol. 6, Qs 39-44, 382-99, 400-06, 423-27, 429-
30, 435-40, 444-45, 516-21 524-30, 533-40, 548-58.
71. Finally, the Applicants' argument ,(at paragraphs 76-77 of. their factum) that the Board
has no power to order "non-parties" (as a narrowly defined term) to respond to Interrogatories
has no merit. Under the Applicants' theory, only the Auec and ACee qua associations are
parties to the Proposed Tariff Proceeding but member Institutions are not and therefore cannot
be requested t6 answer the Interrogatories. If the Court adopted this premise, then it would have
to find that the Board has no authority to require even the Institutions operating under the
- 26-
Interim Tariff to respond to the Interrogatories. This is a submission not even the AUCC or the
ACCC has advanced before the B ~ a r d or any Court.
72. The AUCe and ACee, as mere membership organizations, have no relevant i.nformf!ltion
themselves as regards the rate at which the Board should certify the tariff. They are permitted to
appear as objectors on behalf of their members for the sake of administrative efficiency. This
process has never given members of associations the ability (or right)1 to hide behind the
association, here the AUCC and ACCe
l
to resist reasonable interrogatory requests, since they
are the entities with relevant information and they are the prospective users.
iii. Even if the Opt-Out Institutions are considered third parties, the Board's decision
was proportional and did not impose an unreasonable burden on the Opt-Out
Institutions
73. The Applicants argue that the Board failed to consider whether the requirements for non-
party discovery were met, i.e., that the Interrogatories were relevant, that the Opt-Out
Institutions were prospective users, that the information cannot be otherwise obtained, that the
Interrogatories were proportional, that the Interrogatories effect no unjustified interterence or
prejudice, that the Interrogatories will not interfere with the progress of the proceedings, and that
the time and expense incurred is not onerous.
Applicants' Memorandum, AR, Vol. 8, at para. 79.
74. This is a red-herring. Moreover, it is an entirely new argument that the AUCC never
presented to the Board for its consideration. The AUeC never raised the objection that the
Board lacked jurisdiction or was requ!red to consider any Hrequirements" related to third party
discovery in their submissions regarding the. June 6 Ruling or the August 18 Ruling.
75. The Board's findings. with respect to relevance and uprospective users" have already
been discussed above. With respect to availability of information, it is self-evident that if the Opt-
Out Institutions are not ordered to respond, Access Copyright will not have any evidence about
the copying habits of those purporting to operate outside the Interim Tariff! who could later opt-
in, or otherwise be subject to the Finar Tariff, and this information will not be available to the
B o a ~ d in its Proposed Tariff hearing.
76, With respect to prejudice to the Opt-Out Institutions, they are merely being asked to
supply relevant information. As discussed below, the burden of responding is proportional, and
there will be no collateral interierence or prejudice to their interests in this or any other matter.
77. With respect to interference with progress of the proceedings, the filing of this application
has done more to delay these proceedings than anything else. Clearly, other m.ember
Institutions, indeed the Sept;}mber 1 Opt-Out Institutions, of the AUCC (and ACee) were able to
respond in a reasonably timely manner. If the Interrogatories had been answered pursuant to
the schedules set out in the August 18 Ruling, then the parties would be much closer to a
hearing date for the certification of the Proposed Tariff.
78. With respect to burden in terms of IItime and expense", the Applicants claim that the Opt-
but Institutions will face {(expansive and burdensome" inquiries if forced to respond. In fact, as a
result of the August 18 Ruling, only two Opt-Out Institutions have been chosen to respond to the
Interrogatories. Additionally, the touchstone of the Board's Rulings has been that the Opt-Out
Institutions only need to make IIreasonable inquiries" and provide a "reasonable amount of
relevant information". To date, no inquiries have been made and no information provided. In this
context,' the Board1s June 6 and August 18 Rulings can hardly be described as 4Iunreasonable".
79. The only evidence of the burden that the Applicants have submitted is the affidavit of Mr.
Hurst of Brandon University, who claims that responding to the Jnte-rrogatories would take "many
hundreds of person hours", diversion of staff, and lIeven impinge the basic university
operations". However. on cross-examination, Mr. Hurst admitted that this statement was based
solely on his own estimation without reliance upon substantive conversations with the AUCC,
other Institutions who have responded to the Interrogatories, or any Brandon University library
staff members, management, professors, administrative staff, or information technology staff.
Mr. Hurst admitted that he conducted no real inquiry as to time, cost, or institutional resources
involved, and admitted that other Institutions of similar size to Brandon University had answered
the same Interrogatories. Mr. Hurst was also unaware that Brandon could have requested an
extension of time to comply.
Hurst Affidavit, AR, Vol. 3, Tab 6, paras. 2 2 ~ 2 4 ; Applicants' Memorandum,
AR, Vor. 8, at para. 50.
Hurst Cross-examination, AR, Vol. 6, Tab 9, Qs 245, 274, 278,281 .. 91,294-
95, 298-300, 303-07.
80. Mr. Hurst further testified that if it operated under the Interim Tariff, Brandon University
would not be faced with a situation significantly different from the status quo. Specifically,
Brandon University:
- 28-
(a) would not encounter any unique burdens or expenses out of the ordinary type of
expenses and obligations that Brandon University faces and that are passed on
through the University budget to students through tuition;
Hurst Cross-examination, AR, Vol. 6, Tab 9, Qs 589-96,600,605-11,614-15,619.
(b) new expenses can be reflected in changed student fees; and
Hurst Cross-examination, AR, Vol. 6, Tab 9, Qs 625-29,' 631-34,646-53.
(c) Brandon University, has an accumulated surplus for the 2010-11 budget year of
more than $2 million that can be used to meet a budget change caused by
increased copyright compliance expenses.
Hurst Cross-examination, AR, Vol. 6, Tab 9, Qs 665, 671, 678-81.
81. The Board's June 6 Ruling and August 18 Ruling easily meet th.e administrative law
requirements for intelligibility and reasonableness. The Board made a finding of fact (due the
highest judicial deference) that the Opt-Out (nstitutions are prospective under the
Proposed Tariff based on their past conduct in these proceedings! their proposed use of Access
Copyright material, and their ability to Opt-In (as well as Opt-Out) annually under the Proposed
Tariff. The Board then made a finding that requiring a sample of Opt-Out Institutions to respond
would produce information relevant to its determination of the tariff rate and would not be
burdensome. The thoughtfulness of the Board's decision is reflected in the June 6 Ruling where
it rejected or limited some of Access Copyright's Interrogatories. Courts of record and
administrative tribunals make decisions every day with one-line affirmations of relevance and
reasonableness, and without providing reasons for such decisions. To allow such a decision to
be subject to full fledged judicial review would be contrary to the purpose of, and the
for, judicial review established by the Federal Courts Act..
82. The Applicants treated this as a routine interrogatory matter when the issue was before
the and yet they are attempting - ,too tate - to paint it now as a jurisdictional issue of the
highest order before this Court. The Applicants' attempt must be rejected.
iv. The Board's decision properly took into account sections 66.7(1) and 70.15 of the
Copyright Act
83. The Applicants do not identify how the Board failed to properly take account of section
66.7(1) and 70.15 of the Act. They merely state that the general powers of the Board identified
- 29-
in section 66.7(1) may only be exercised within the limits of the Board's authority in section
70.15 to certify tariffs with regard to objections thereto.
84. Section 66.7(1) provides the Board wide procedural authority:
General powers, etc.
66.7 (1) The Board has, with respect to the attendance, swearing and
examination of witnesses, the production and inspection of documents, the
enforcement of its decisions and other matters necessary or proper f o ~ the due
exercise of its jurisdiction I all such powers, rights and privileges as are vested in
a superior court of record.
Copyright Act, s. 66.7(1).
85. Section 70.15 provides the context in which that authority may be exercised:
Certification
70.15 (1) The Board shall certify the tariffs as approved, with such alterations to
the royalties and to the terms and conditions related thereto as the Board
considers necessary, having regard to any objections to the tariffs.
Copyright Act, s. 70.15.
86. Thus, section 66.7 confers upon the Board the full procedural authority necessary for it
to periorm its duties to certify a tariff under section 70.15. This Court has recognized that this
authority is quite comprehensive and not to be narrowly circumscribed:
These powers are useful complementary tools at the disposition of the Board for
use upon request or of its own motion in appropriate circumstances: see section
6 of the Board's Model Directive on Procedure .... ITlhese powers can
conveniently be used by the Board to complement a partially defective record ...
[emphasis added] .
Society of Composers, Authors and Music Publishers of Canada v. Bell
Canada, 2010 FCA 139 at para. 33, , ACBA, Tab 11.
87. Requiring a small sample of the Opt .. Out Institutions to respond to Interrogatories is, as
the Board has explained in its June 6 Ruling and its August 18 Ruling, crucial to allowing th.e
Board to obtain evidence necessary to certify a fair and equitable tariff. It is necessary because
the Opt .. Out lnstitutions have relevant information about copying practices. And it is also
necessary in order for the Board to control its own procedures. If the Opt-Out Institutions are to
be allowed to present evidence at the tariff hearing (which the Applicants claim is the AUCC's
and/or the Institution's right). then fairness dictates that Access Copyright should have access to
relevant information responsive to the Interrogatories.
- 30-
. v. The Board's statements at 6 to 8 of the August 18 Ruling do not
constitute improper bias or pre-judgment, and are regardless irrelevant to the
Application
88. There is nothing in paragraphs 6, 7, or 8 of the August 18 Ruling that places the
Applicants at a disadvantage or indicates any pre-judgment of the issues on the merits.
89., Paragraph 6 merely confirms that Access Copyright may file with. the Board an
application limiting the ability of an Opt-Out Institution that does not provide Interrogatory
responses to file evidence at the Proposed Tariff hearing absent the Board's leave. The Board
does not say that it will grant such an application., Nor does the Board state that there is a
presumption that leave will not be granted. Additionally, the Board's June 6 and August 18
Rulings only require a reasonable inquiry and reasonable response from the Opt-Out
Institutions. Any prejudice here is three causal chains away from actual fruition and, even if the
Applicants' position is sustained, only amounts to an interlocutory evidentiary decision.
90. Paragraph 7 of the August 18 Ruling notes that if the Opt-Out Institutions choose not to
provide Interrogatory responses, then the Final Tariff certified by the Board might be higher than
otherwise, as the record will not reflect the copying habits of Opt-Out I nstitutions (presumably
low-volume copiers) as accurately as it would if they fully participated. No determination is made
in this regard. This does not constitute an improper bias or ('signaI
JJ
of the Board's direction on
the merits, as the Applicants argue. First, the Applicants have not filed any evidence of bias and
do not even bother to layout the test for bias in their factum, which is reflective of their lack of
conviction in their own claim. Second, the standard for alleging a reasonable apprehension of
bias is objective and The Federal Court of Appeal has stated that it is a "serious allegationll
that shall not be made lightly and Ilcannot rest on mere suspicion, pure conjecture, insinuations
or mere impressions of an applicant or his counsel. It must be supported by material evidence .
demonstrating conduct that derogates from the standard. It is often useful, and even necessary,
in doing so, to resort to evidence extrinsic to the case." The Applicants can point to no evidence
showing that the tenor of the August 18 Ruling discloses prejudgment or bias rather than
statements in a routine interrogatories dispute.
Arthur v. Canada (Attorney General), 2001 FCA 223, at para. 8, ACBA,
Tab 12. .
91. Paragraph 8 of the August 18 Ruling merely reminds the objectors that an Opt-Out
Institution's decision to operate outside the Interim Tariff will not immunize it from potential
liability or an obligation to provide information under the .Final Tariff; it makes:no determination
- 31 -
in this regard. The Applicants claim that, by this statement, the Board is engaging in improper
lI enforcement
17
of a tariff. Of course, the Board nowhere states that it is attempting to
prospectively enforce the Interim Tariff or any other tariff against the Opt-Out Institution.
92. The Board's statements in paragraphs 6 to 8 of the August 18 Ruling are not even ripe
for judicial review, much less evidence of impermissible bias. Moreover, they are irrelevant to
the substance of the AUCC's application for judicial review of the August 18 Ruling. In short, the
Applicants' argument with respect to these statements is yet another introduced to
distract this Honourable Court from the paucity of any merits to the AUCC's challenge of the
August 18 Ruling.
B. September 23 Ruling
i. The Board's decision is consistent with and takes into account the statutory
context and purpose of the Act
93. The Applicants argue that because the general purpose of the Copyright Act is to
provide copyright users access to works while ensuring proper reward for their creators, the
Board's refusal to order Access Copyright to offer transactional licences to the Opt-Out
Institutions is de facto unreasonable as being inconsistent with the general purpose of the Act,
as well as section 70.2 specifically,
Applicants' Memorandum, AR, VoI.S, at para. 102-03.
94. As a preliminary matter, the Court should note that although the AUCC spends almost
four pages (paragraphs 96-101) on this argument in its Memorandum, it did not raise these
arguments in its application to the Board to amend the Interim Tariff. While the AUCC did
discuss in general terms how the collective licensing regime was brought about through
amendments to the statute over the past 30 years, nowhere did it suggest (as it does now) that
if the Board refused to order mandatory transactional licences pursuant to the Interim Tariff (as
opposed to individually per section 70.2) the Board would be acting in a manner "inconsistent
with the statutory context and purpose of the copyright licensing regime. II The Applicants now
argue (which Access Copyright disputes) that the Board had no discretion to deny. ordering
Access Copyright to grant transactional licences given this "statutory context.!!
Wills Affidavit (A-395 .. 11)J AUCC's July 19 2011 Submission to the Copyright
Board, AR, Vo1-5, Ex. "J", pp.1038-40.
- 32-
95. The Supreme Court of Canada ruled that "discretion will not be exercised in
favour of an appricant on judicial review where the issue could have been but was not raised
before" the administrative body, offering several rationales, including: (a) the administrative
body's specialized functions or expertise"; and (b) doing so IImay unfairly prejudice th.e
opposing party and may deny the court the adequate evidentiary record required to consider the
issue".
Alberta (Information and Privacy Commissioner) v. Alberta Teachers'
Associations, 2011 sec 61 at paras. 22-29, ABA, Tab 2.
96. Both considerations apply here. The Applicants are contestir}9 the considered judgment
of the expert federal board to set tariff and licence rates in a complicated statutory
scheme that Tequires the application of both legal and industry expertise. Furthermore, the
Applicants' failure to bring this argument before the Board denied the Board the opportunity to
explain the scope of its powers and the nature of its discretion given the general statutory
purpose as that interacts with SUb-sections 70.2 and 70.15 of the Act. As a result, this Court
does not have an adequate evidentiary record to consider this issue and Access Copyright
would be unfairly prejudiced if the Court exercised its discretion in favour of the Applicants.
97. Assuming the Court should consider the Applicants
'
argument in this contextl Access
Copyright submits that the AUCC1s argument is inconsistent with the scheme of
the Act. Under the Act, the Board is empowered to issue licences under three circumstances: to
set the terms of licences pursuant to subsection 70.2(2); to change the terms of licenSing
agreements at the request of the Commissioner of Competition pursuant to subsection 70.6(1);
and, to issue a licence for the use of a work whose copyright owner cannot be located pursuant
to subsection 77(1). These are the only circumstances under which express statutory authority
is granted to the Board to issue compulsory licences.
Copyright Board, Reasons for Dec. 23, 2010 Interim Tariff (March 16, 2011),
Wills Affidavit (A-339-11), Exhibit "Eu r AR, Vol. 2, p. 152.
98. Access Copyright is a collective society within the meaning of section 70.1 of the Act.
'Section 70.12 of the Act that a collective society may: operate via tariff or entering into
licences. It does not read that a collective society 'Cshall" or "musf' operate via a licence where a
user does not want to operate under a tariff.
70.12 A collective society may. for the purpose of setting out by licence the
royalties and terms and conditions relating to classes of uses,
(a) file a proposed tariff with the Board; or.
- 33-
(b) enter into agreements with users.
Copyright-Act, R.S.C. 1985, C C-42, s. 70.2.
99. Among other things, copyright owners have the exclusive right to reproduce their works
in whole or in substantial part, and to authorize such reproduction. Nothing in the Act compels a '
copyright owner, or a collective society under section 70.12. to licence the reproduction of any
copyright-protected work. To find otherwise, as the AUCC argues, would mean that Canada has
a compulsory licensing regime. It does not.
100. Finally, as alluded to the Applicants are arguing that the general context and
purpose of the Act make it unreasonable to deny them an' order mandating a copyright collective
to provide mass transactional licences in the context of a tariff certification proceeding. This is
the exact reverse of traditional administrative law analysis - while specific textual provisions in a
statute may limit discretion, it is rare that a statute's general purpose will mandate that certain
action be taken. To establish such an unorthodox result, the Applicanfs should be forced to
establish that they are entitled to a mandamus remedy, ordering discretion be exercised in a
specific manner. The requirements for mandamus are significant, and the Applicants have
neither pleaded nor established them here:
Before this Court will order a writ of mandamus, the following criteria [ ... ]
must be satisfied:
(a) there must be a public legal duty to act under circumstances;
(b) the duty must be owed to the applicant;
(c) there must be a clear right to performance of that duty, and in
particular the applicant must have satisfied all conditions precedent
giving rise to the duty;
(d) no other adequate remedy is available to the applicant;
(e) the order sought must have some practical effect;
(f) in the exercise of its discretion, the court must find no equitable bar
to the relief sought; and
(g) on a balance of convenience, an order of mandamus should issue.
Khalil v. Canada (Secretary of State), [1999] 4 Fe 661 at para. 11, ACBA,
Tab 13.
ii. The Board correctly, and certainly reasonably, apprehended the purposes of
providing interim relief under section 66.51 of the Act
101. The Applicants argue that the purpose of section' 66.51 of the Act is to protect parties
affected' by the length and uncertainty of the tariff proceeding before the Board and that the
Board IImisdirected" itself by assuming that the Interim Tariff as issued reflected the status quo
between the parties. This argument was not ra,ised the Board. Instead, the AUCC chose
- 34-
to justify its request for an amendment to the Interim Tariff on the grounds that Access
Copyright's' refusaf to grant transactional licences represented a change from the status quo
that existed before the Interim Tariff came into effect on January 1, 2011. For the same reasons
as advanced above, the Court should dismiss the argument outright.
AUCC's July 19 2011 Submission to the Copyright Board, Wills Affidavit (A-
395-11), AR, Vol. 5, Ex. "J", pp.
102. Assuming that the Applicants are entitled to make this argument for the first time in this
Court, the Board's ruling remains correct, . and certainly reasonable. The Board stated in its
September 23 Ruling that "[t]he interim tariff seeks to reflect the status quo to the extent
possible and reasonable'!. Thus, it is incorrect to suggest that the Board focused on the status
quo to the exclusion of the interests in certainty under section 66.51. The Board simply agreed
with Access Copyright that the Interim Tariff reflected the status quo and was reasonable.
103. That finding is supported by the record. Access Copyright submitted to the Board that:
Access Copyright has never issued transactional licences to post-
secondary ed ucational institutions for paper copies. Nor has Access
Copyright ever entered into a transactional licence for digital with any
post-secondary educational institution that had not already entered into a
comprehensive licence for paper copying, and was therefore paying the
FTE rate under the comprehensive licence. In its application, the AUCC
is seeking an amendment to the Interim Tariff that would give a right to
Institutions - including those who have not taken up the tariff and who
are therefore not paying the FTE rate - to demand a transactional
licence for paper copies andl or digital copies. What the AUCC is
seeking would entirely change the status quo ante for paper and digital.
Access Copyright's July 8 2011 Submission to the Copyright Board, Wills
Affidavit (A .. AR, Vol. 5, Ex. "I", pp. 1009.
104. Access Copyright submitted that the AUCC was requesting a change from the status
quo:
In essence, the AUCC is asking that the Board establish an interim tariff
that provides an a-la-carte menu. for post-secondary institutions: an
institution can choose to pay: (i) the FTE rate; (ii) a transactional (Le.,
one-off) licence for paper coursepack copying; (iii) a transactional licence
for digital copying; and (iv) a blanket licence for digital copying under
Schedule "G", or any combination of the above. This is not reflective of
the status quo, is a completely unworkable model, would be a
compliance and revenue-tracking nightmare (particularly in the digital
environment) and should not. be implemented by the Board without
cogent and conVincing evidence that it is the appropriate way to reflect
value and fairly compensate rightsholders.
- 35-
Access Copyright's July 8 2011 Submission to the Copyright Board, Wills.
Affidavit AR, Vol. 5, Ex. "In J pp. 1011.
105. The Board agreed, finding:
,AUCC asks for something institutions either never had or rarely used.
Based on the record, we conclude that, at least since 2004, Access has
granted digital or paper transactional licences only to insUtutions that
bought the FTE licence, and only for uses that were not allowed by the
FTE or coursepack licences. Furthermore, the use of digital transactional
Ucences was minimal. In 2010, permission was sought for 1,160 titles.
Less than two per cent of institutions regularly purchased digital
transactional licences, and less than 10 per cent made at least one
application. Royalties paid pursuant to those licences totaled less than
one per cent of what Access collected pursuant to the FTE and
coursepack licences.
September 23 Ruling, Wills Affidavit (A
w
395-11), AR, Vol. 5, Ex. "A", p. 856.
106. The Applicants' affiant Mr. Wills in cross-examination confirmed that he was unaware of
any situation prior to January 11, 2011 where Access Copyright had granted a transactional
licence to an Institution that had not already entered into a blanket, Model Licence agreement
with Access Copyright.
Wills Cross-examination, AR, Vol. 5, Tab 10, Qs 346-53, 358-59.
107. Moreover, Mr. Hurst testified on cross-examination that Brandon University never
requested a transactional licence from Access Copyright. Therefore, he can hardly claim that
the Board's refusal to order mandatory transactional licences is a change from the status quo.
Hurst .. AR, Vol. 6, Tab 9, Qs 336-37.
108. The Applicants complain that the Board's decision ignored the changed circumstances
after the prior licences expired by focuss,ing too much on the blanket licensing agreements.
They also complain that the Board's concern with monitoring requirements for transactional
licences was misplaced because Access Copyright had previously digital licences, and
that the low volume of transactional licence requests is not a reason to refuse to mandate
transactional licences in the'absence of other licensing alte(natives.'
Applicants' Memorandum, AV, Vol. 8, at paras. 105 .. 07, 110 .. 11.
109. However, the Board considered these issues at length in the September 23 Ruling,
ultimately rejecting the AUCC's proposal as too difficult to administer. The Board identified
several problems with AUCC's proposal in,cluding:
- 36-'
(a) inherent monitoring 'issues;
(b) cost-intensive administrative issues;
(c) contradictory submissions by the proponents of transactional licences that made
it "difficult to lend credence to their statements";
(d) uncertainty resulting between any variance between a transactional licence and
Fin'al Tariff;
(e) a balance of convenience favouring Access Copyright, as the "[a]mounts in issue
are prima facie significant for Access, far less so for the institutions
U
,; and
(f) "operational difficulties" in the AUCC's proposal.
September 23 Ruling. Wills Affidav,t (A-395-11), AR, Vol. 5, Ex. "A", p.
61. '
110. These are all findings of fact that cannot be overturned by a court on judiCial review
unless they are capricious, perverse, or made without regard to the evidence. The Board's
reasons for making these findings are clear, intelligible and reasonable. The Applicants have no
grounds (and have proffered no basis) for challenging the findings as capricious, perverse, or
arbitrary. They object simply because the Board reached a different conclusion than that sought
by the AUCC.
iii. The ruling is consistent with earlier decisions of the Board that the Interim Tariff is
voluntary and will not impair alternative licensing mechanisms
111. The Applicants argue that the September 23 Ruling is inconsistent with the Interim Tariff
decision of the Board, because the effect of the refusal by Access Copyright to provide
transactional licences is to force Opt-Out Institutions to forego copying a work or obtain a full,
blanket licence under the Interim Tariff. However, even a cursory review of the Board's
September 23 Ruling shows that the Board addressed this argument and found it Jacking for
good reason. Paragraph 113 of the AUCC's factum manifestly ignores and misrepresents these
reasons.
Applicants' Memorandum, AR, Vol. 8, paras. 16.53,54,61,99-100.
112. Under the general tariff regime of the Act, the collective - not the user - decides whether
to apply for a tariff. Once a collective decides to file a tariff, licensing can occur only with the
collective's consent. It is only if a collective does not file for a tariff that a user can apply under
section 70.2 to fix .the ,royalties for the use of a work in the repertoire pursuant to
arbitration before the Board. The Board found that Access Copyright had a right to rely on the
- 37-
Tariff. The Board did not find that "Institutions!' must take up the blanket licence to the
exclusion of other licensing options or forego ,copying of the work (para'graph 113, Applicants'
Memorandum). The Board explained that the Interim Tariff never required Access Copyright to
enter into a transactional licence with any person:
The Board's reasons of March 16, 2011 contain the following statement:
11[ ... ] users whose consumption patterns justify -different rates remain free
to secure, from Access or from others, transactional or other licences
that will trump the tariff. The fact that the interim tariff can be modified at
any time ensures that Access will displav good faith in such negotiations.
Any misconduct on its part would necessarily be reported to the Board,
which would take it into account in any further consideration of this
maUer." [our underlining]
Relying on this statem'ent. objectors argue that the refusal of Access to '
deal with institutions on a transactional basis constitutes misconduct
warranting an intervention on the part of the Board. We disagree. To
state that a user is free to approach Access for a licence does not mean
that Access must accede to the request. Whether the refusal of Access
is reasonable must be assessed according to all the relevant
circumstances. In this instance, Access is prima facie justified to rely on
the interim tariff and let the regulatory process run its course ....
September 23 Ruling, Wills Affidavit AR, Vol. 5, Ex. "A", p. 855-
58.
113. This is a reasonable interpretation of the Board's Interim Tariff decision - it is intelligible,
consistent with the rest of the Board's findings in the September 23 Ruling, and consistent with
the scheme of the Act that provides only limited mechanisms for mandatory licensing, none of
which apply in this context.
In the Alternative. to the Extent the Board Erred. the Proper Remedy is Remand
114. Quashing or vacating the Board's decision and substituting for it the CQurfs own
determination of the issue would be an intervention of the highest order by the Court. This Court
has firmly discouraged such a course of action, stating:
While directions that the Court may issue when setting ,aside a tribunal's
decision include directions in the nature of a directed verdict, this is an
exceptional power that should be exercised only in the clearest of
circumstances: ... Such will rarely be the case when the issue in 'dispute
is essentially factual in nature.:.
Canada (Minister of Iiuman Resources Development) v. Rafuse, 2002 FCA
31 at para. 14, ACBA, Tab 4.
115. This Honourable ,Court has been very clear that even if the administrative body has
made' an error of law, the matter should generally be remanded to-the tribunal:
- 38-'
[I]f, as a result of an error of law, a tribunal has omitted to .make a
relevant finding of fact, including a factual inference, the matter should
normally be returned to the tribunal to enable it to complete its work.
Canada (Minister of Human Resources Development) v. Rafuse, 2002 FCA
31 at para. 13, ACBA, Tab 4.
116. Even the extraordinary mandamus power does not permit a court to dictate an
administrative body's decision on the merits.
[I]t is settled law that -mandamus cannot be sought to compel the
exercise of discretion in a particular way. Put another way, while
mandamus may compel a decision-maker to consider a matter, it !ldoes
not dictate the result of such a process.
lI
Canada (Chief Electoral Officer) v. Callaghan, 2011 FCA 74 at para. 126,
ACBA, Tab 14.
117. Should the Court find that the Board committed reviewable error, at most, a remand for
further reasons or consideration of the decision with regard to a specific issue(s) is appropriate.
118. With regard to the August 18 Ruling, the Applicants have only alleged that the Board
failed to consider the elements required for ordering third party discovery. As discussed above,
Access Copyright disputes that the Opt-Out Institutions were third parties and that, even if they
were, the Board's reasons do not meet these requirements. Nevertheless, if this Court finds the
reasons insufficient, the proper recourse is to remand with instructions for further consideration
of the issue, especially as the Applicants did not 'raise this issue before the Board. This Court
should not simply substitute its decision for the Board's decision and make a finding that the
Opt-Out Institutions cannot be requested to respond to Interrogatories.
119. With regard to the September 23 Ruling, the Applicants allege that the Board's decision
is inconsistent with the purpose and context of the Act, that the Board misapprehended the
purpose of interim orders under section 66.51 of the Act, and that the Board's decision is
inconsistent with its Interim Tatiff decision. The first two complaints were not made to the Board
by the AUCC in its application to amend the Interim Tariff. If the Court concludes that these
should have been addressed by. the Board, the proper remedy is to 'remand these matters to the
Board for consideration, in order that the Board will have a chance to address these issues.
120. The AUCC's last argument disputes the Board's finding of fact that the Interim Tariff
reflects the status quo and that Access Copyright has not acted in bad faith by refusing to
provide transactional licences. With respect to this issue, remand is appropriate to allow the
Board to reconsider its decision in light of any finding of the Court in this respect.
- 39-
PART IV .. ORDER SOUGHT
121. Access Copyright respectfully seeks an order:
(a) dismissing the Applicants' 339 Application and 395 Application for judicial review;
(b) in the event this Honourable Court concludes that the Board committed a
error in either the August 18 Ruling or the September 23 Ruling, that
this Court remand the August 18 Ruling or the September 23 Ruling, or both as
the case may be, to the Board for further consideration; and
l
(c) its costs of these applications.
ALL OF WHICH IS RESPECTFULLY SUBMITTED this 16th day of February, 2012.
BLAKE, CASSELS & GRAYDON LLP
Barristers & Solicitors
45 O'Connor Street
Suite 2000, World Exchange Plaza
Ottawa ON K1 P 1A4
Randall Hofley
Nancy Brooks
Tel: 613-788-2200
Fax: 613-788-2241'
randall. hofley@blakes.com
nancy .brooks@blakes.com
Solicitors for The Canadian Copyright
Licensing Agency operating as jjAccess
Copyright"
- 40-
PART V - LIST OF AUTHORITIES
APPENDIX A
Statutes
1. Copyright Act, 55. 2, 66.7(1}, 66.51, 70.11 70.2, 70.2(2), 70.6(1), 70.12, 70.14, 70.15,
and 77(1)
APPENDIX B
Authorities
1. Newfoundland and Labrador Nurses' Union v. Newfoundland and Labrador (Treasury
Board), 2011 SCC 62
2. Coupal v. Canada (Attorney General), 2006 Fe 255
3. Bell Canada v. Canadian Telephone Employees Association, 2001 FCA 139
4. Canada (Minister of Human Resources Development) v. Rafuse, 2002 FCA 31
5. Szczecka v. Canada (Min. of Employment & Immigration) (1993), 116 D.L.R. (4th) 333
(Fed. C.A.)
6. Cosgrove v. Canada (Attorney General), 2008 FC 941
7. Canada (Border Services Agency) v. C.B. Powell Limited, 2010 FCA 61
8. Canada (Min. of Citizenship & Immigration) v. Varela, 2003 FCA 42
9. Sanofi Pasteur Ltd. v. Canada (A.G.) (2008),2008 FC 286
10. Dumbrava v. Canada (Minister of Citizenship and Immigration), [1995] F.C.J. No. 1238,
101 F.T.R. 230
11. Society of Composers, Authors and Music Publishers of Canada v. Bell Canada, 2010
FCA 139
12. Arthur v. Canada (Attorney General), 2001 FCA 223
13. Khalil v. Canada (Secretary of State), [1999}4 Fe 661
14. Canada (Chief Electoral Officer) v. Callaghan, 2011 FCA 74