Judgments

Decision Information

Decision Content

A-831-82
The Queen (Appellant) (Plaintiff) v.
James Lorimer and Company Limited (Respond- ent) (Defendant)
Court of Appeal, Heald, Mahoney and Ryan JJ.— Ottawa, November 29, 1983 and January 5, 1984.
Copyright — Government publication — Infringed by pri vate sector publisher — Fair dealing defence rejected — Trial Judge finding deliberate infringement for commercial gain — Refusing to grant Crown injunction, exemplary damages and costs — Crown characterized as "unusual plaintiff' — Awarding Crown 8% royalty re future sales of infringing work and damages re past sales — Judge dismissing counterclaim for damages re communications by Attorney General with sellers of infringing work — Appeal allowed, cross-appeal dismissed — Market-place competition not necessary for infringement — Where infringement, copyright owner prima fade entitled to injunction — No necessity to prove damages — Legislation not contemplating compulsory licence — Man datory injunction for delivery up of infringing work — Not proper to grant injunction for reacquisition of copies distribut ed — Exemplary damages could have been awarded — Trial Judge not clearly erring in exercising discretion to refuse — No basis for denial of costs — Trial Judge correct in rejecting freedom of expression Charter argument and defence of public interest — Copyright Act, R.S.C. 1970, c. C-30, ss. 11, 17(1),(2)(a), 20(1),(2) and 21 — Combines Investigation Act, R.S.C. 1970, c. C-23, ss. 7(1), 18(1).
Practice — Costs — Crown successful in copyright infringe ment action — Trial Judge exercising discretion in denying costs — Stating not "a case where the defendant needs to be punished ... by the assumption of the costs that would nor mally follow" — Discretion as to costs to be exercised judi cially — Purpose of costs not to punish unsuccessful party — Reasons given for denying costs having nothing to do with case — No basis for refusal of costs — Appeal allowed — Copy right Act, R.S.C. 1970, c. C-30, s. 20(2).
Damages — Exemplary or punitive — Action by Crown for copyright infringement of Government publication — Trial Judge referring to defendant's "blatant disregard" of copy right laws but not awarding exemplary damages — Facts
within Rookes v. Barnard — Judge not clearly erring in exercising discretion to refuse.
Constitutional law — Charter of Rights — Freedom of expression — As defence to action for copyright infringement of Government publication — No merit in defence where infringing work containing little of defendant's own thought, belief, opinion or expression — Canadian Charter of Rights and Freedoms, being Part I of the Constitution Act, 1982, Schedule B, Canada Act 1982, 1982, c. 11 (U.K.), ss. 1, 2(b).
A statement of evidence prepared for the Restrictive Trade Practices Commission by the Director of Investigation and Research under the Combines Investigation Act was published under the title The State of Competition in the Canadian Petroleum Industry. The work consisted of seven volumes and the set was priced at $70. It was the subject of Crown copy right. A single volume infringing work was published by James Lorimer and Company Limited. It was offered for sale at $14.95 retail. Although the Trial Judge found that there had been deliberate infringement for commercial gain and rejected the defence of fair dealing, the Crown was denied the relief claimed: an injunction and exemplary damages. Nor did the Judge award costs. The judgment provided for payment to the Crown of an 8% royalty with respect to future sales of the infringing work together with damages, at the same rate, in respect of copies already sold. The Crown was characterized as an "unusual plaintiff' in not being "greatly interested in income or revenue from this work". It was further said in the judgment that the defendant's publication did not adversely affect sales of the original work. It was for these reasons that injunctive relief was not granted. The Crown appealed. Lorimer cross-appealed the dismissal of its counterclaim for damages arising out of communications between the Attorney General and those selling the infringing work.
Held, the appeal should be allowed and the cross-appeal
dismissed with costs at trial and upon appeal.
i
The Act is clear. If an infringer does something that the copyright owner alone may do, there is infringement regardless of whether or not this results in competition in the market place. Once infringement has been established, the copyright owner is prima facie entitled to an injunction restraining further infringement. That the copyright owner has suffered no damages is no basis for refusing an injunction. There was no authority for requiring a copyright owner to acquiesce in a continuing infringement against payment of a royalty. The relevant legislation made no provision for what would amount to a compulsory licence. The Trial Judge accordingly erred in law in declining to permanently enjoin the defendant from reproducing substantial portions of the plaintiff's work and in refusing to grant a mandatory injunction requiring delivery up of the production plates and of all copies of the infringing work in the defendant's possession or control. It would not, however,
be proper for the Court to grant a mandatory injunction requiring the defendant to reacquire all copies distributed for sale since it would not be entirely within the defendant's power to comply with such order.
In view of the reference in the judgment to the defendant's "blatant disregard" of the copyright laws, one might have anticipated an award of exemplary damages. The facts of the instant case appeared to fall within the second category enun ciated by Lord Devlin in Rookes v. Barnard et al., [1964] A.C. 1129 (H.L.). Exemplary damages could have been awarded. But while it was difficult to reconcile the language of the reasons for judgment with the conclusion not to award such damages, it could not be said that the Trial Judge had clearly erred in the exercise of his discretion.
Although the matter of costs was in the absolute discretion of the Court, that discretion had to be exercised judicially. The time was long past when the Crown, in accordance with the "rule of dignity" neither asked nor paid costs. None of the reasons given for denying costs herein had anything to do with the case. The Crown had a clear right of action, the subject- matter was not trivial and the plaintiff was successful at trial. There was no basis for a denial of costs.
The Trial Judge was quite correct in rejecting the defences of fair dealing and public interest as well as the Charter argument concerning freedom of expression.
CASES JUDICIALLY CONSIDERED
APPLIED:
Donald Campbell and Company Limited v. Pollack, [1927] A.C. 732 (H.L.).
DISTINGUISHED:
Hubbard et al. v. Vosper et al., [1972] 2 Q.B. 84 (Eng. C.A.); Beloff v. Pressdram Limited et al., [1973] R.P.C. 765 (Ch.D.).
CONSIDERED:
Time Incorporated v. Bernard Geis Associates, et al. (1968), 293 F.Supp. 130 (S.D.N.Y.).
REFERRED TO:
Massie & Renwick, Limited v. Underwriters' Survey Bureau Limited et al., [1937] S.C.R. 265; Bouchet v. Kyriacopoulos (1964), 45 C.P.R. 265 (Ex. Ct.); appeal dismissed, [1966] S.C.R. v; Dominion Manufacturers Limited v. Electrolier Manufacturing Company Limited, [1939] Ex.C.R. 204; Underwriters' Survey Bureau Lim ited v. Massie & Renwick Limited, [1942] Ex.C.R. 1; Rookes v. Barnard et al., [1964] A.C. 1129 (H.L.); Paragon Properties Ltd. v. Magna Investments Ltd. (1972), 24 D.L.R. (3d) 156 (Alta. C.A.); Netupsky et al. v. Dominion Bridge Co. Ltd. (1969), 58 C.P.R. 7 (B.C.C.A.).
COUNSEL:
D. Sgayias and M. Ciavaglia for appellant (plaintiff).
B. C. McDonald and C. Trethewey for respondent (defendant).
SOLICITORS:
Deputy Attorney General of Canada for appellant (plaintiff).
Hayhurst, Dale & Deeth, Toronto, for respondent (defendant).
The following are the reasons for judgment rendered in English by
MAHONEY J.: This is an appeal and cross- appeal from a judgment of the Trial Division [dated April 30, 1982, T-2216-81, not reported] which found the respondent had infringed the appellant's copyright in a certain work but denied the appellant costs as well as the injunctive relief and exemplary damages sought and dismissed the respondent's counterclaim without costs. The learned Trial Judge found that the Crown owned the copyright in its work (Appeal Book, page 142, lines 1 and 2). He rejected the defences of fair dealing, violation of Charter freedoms and public interest (page 159, line 24 to page 160, line 2). He characterized the infringing work as an abridge ment (page 144, line 5) and the respondent's con duct as deliberate (page 159, lines 13 to 24) and a "blatant disregard" of the appellant's rights (page 164, lines 23 to 26). The infringement was done for a "primarily commercial" purpose (page 150, lines 28 and 29). It is agreed the appellant suffered no economic loss. The findings of fact by the learned Trial Judge are amply supported by the evidence and are not to be disturbed.
The Copyright Act' provides:
11. Without prejudice to any rights or privileges of the Crown, where any work is, or has been, prepared or published by or under the direction or control of Her Majesty or any government department, the copyright in the work shall, sub ject to any agreement with the author, belong to Her Majesty
' R.S.C. 1970, c. C-30.
and in such case shall continue for a period of fifty years from the date of the first publication of the work.
The work subject of the Crown copyright here is a report entitled The State of Competition in the Canadian Petroleum Industry. The content of the work is the statement of evidence prepared by the Director of Investigation and Research under the Combines Investigation Act, 2 submitted to the Re strictive Trade Practices Commission pursuant to subsection 18 (1) of that Act ensuing upon an inquiry instituted on application under subsection 7(1). The appellant caused the 1748-page work to be published in seven volumes and offered for public sale at $70 a set, $10 a volume. (Exhibit A-1.)
The respondent's infringing work is an abridge ment of the Crown's work consisting, in the words of its publisher's introduction, of:
... the full text of Volume I—the findings and recommenda tions of the Director regarding the oil industry, together with much of the supporting discussion and information from Volumes II-VI. In the interests of keeping this volume to a reasonable length, some of the more technical sections have been omitted. But conclusions and summaries from all sections of the report have been reprinted ....
In this volume, the original volume, chapter and section heads from the full report have been retained, as have their letter and numerical designations.
Footnote numbers from the original report have been retained. Readers wishing to obtain footnote references can find them in Volume VII of the full report.
The infringing work, a single, 626-page volume, was retailed at $14.95. (Exhibits A-2 and A-3.)
Dealing first with the appeal, the first point in issue is the refusal to grant the relief sought, which was:
(a) a permanent injunction enjoining and restraining the Defendant company, its officers, servants, agents and employees from producing or reproducing substantial por tions of the Report of Robert J. Bertrand, Q.C., Director of Investigation and Research, Combines Investigation Act, entitled "The State of Competition in the Canadian Petroleum Industry" in a book entitled "Canada's Oil Monopoly" or in any other form whatsoever;
(b) a mandatory injunction requiring the Defendant company, its officers, servants, agents and employees to immediately deliver up to the Plaintiff all plates used or intended to be
2 R.S.C. 1970, c. C-23.
used for the production of the book entitled "Canada's Oil Monopoly";
(c) a mandatory injunction requiring the Defendant company, its officers, servants, agents and employees to immediately deliver up to the Plaintiff all copies of the book entitled "Canada's Oil Monopoly" which are presently in its possession or control;
(d) a mandatory injunction requiring the Defendant company, its officers, servants, agents and employees to reacquire all copies of the book entitled "Canada's Oil Monopoly" which have been distributed for retail or wholesale sale or distribution and to immediately deliver up said copies to the Plaintiff;
(e) an accounting of all monies received by the Defendant company from the publication and sale of the book entitled "Canada's Oil Monopoly" and payment over to the Plain tiff of the resulting profits from such publication and sale;
(f) exemplary damages;
As to (d), I know of no precedent for such an order. It was obviously intended to require recov ery of copies no longer within the defendant's control as copies within its control were covered by (c). Compliance with such an order would not be entirely within the power of the person to whom it is directed. A prudent infringer might well attempt to do just that to reduce his exposure to damages but I do not think it a proper order by the Court and will not refer to it further. The claim for relief in paragraph (e) was withdrawn at trial. That claimed in paragraphs (a), (b), (c) and (f) was refused and, instead, a royalty of 8% of the retail selling price of the infringing work was awarded in respect of future sales and damages of $3,192.12, calculated on the basis of 8% of their retail selling price, awarded in respect of sales prior to judgment.
The learned Trial Judge, after reviewing the evidence, found [at page 20 of the reasons for judgment]:*
All of that seems to confirm that Mr. Lorimer knew and acted at all times in a manner consistent with a person who knew that what he was doing was on the face of it an infringement of the plaintiff's copyright, and that he should either secure the consent or permission of someone to go ahead with it or expect to negotiate some kind of licence or royalty, and I therefore
* Judgment was delivered orally from the bench. I have taken the liberty of correcting obvious typographical and spell ing errors in the transcript.
conclude that, if the copyright laws are to mean anything, then this defendant ought not to have done what it did in publishing this report in the form it did without the consent of the plaintiff.
(Appeal Book, page 159)
In denying exemplary damages and substituting what is, in effect, a compulsory licence for the injunctive relief, the learned Trial Judge said [at pages 21-23]:
Turning to remedies, I have found against the defendant on the basis that Mr. Lorimer, it seems to me, could have avoided the grief that visited him in this matter by the simple expedient of at least making some effort to secure permission before publication. He might be in a different position before this Court if he had demonstrated that he indeed did not assume that he would be tied in a bureaucratic tangle but rather at least offered to put his abridgement or proposed abridgement before someone who would have the opportunity to approve it, to authorize it, or license it or refuse it. But there was no evidence put forward of any effort in that regard on the part of Mr. Lorimer or any representative of his company. To that extent, therefore, he is the author of his own misfortune and that of his company in failing simply to take the expedient of attempting to secure authority which at least on the basis of Mr. Bertrand's evidence might very well have been forthcoming in some form or other. Furthermore, it might very well have been forthcoming in the form of what he described as a non-exclusive arrangement which might not have cost him anything.
On the other hand, I cannot overlook the fact that, by acting in the way that he did, he abrogated [sic] to himself what was in effect an exclusive right to publish an official abridgement of this report and, as such, was acting entirely in disregard of the copyright laws.
In terms of remedy, the plaintiff does not seek any account ing profits. I am relieved, therefore, of the burden of examining into the profit and loss information of the defendant company. 1 do not think that justice is served by having this Court attempt or either of the parties attempt at this time to withdraw from circulation or from publication a further distribution of copies of this work. It is not a situation, in other words, of the plaintiff's original work in its distribution or sale that the fact the plaintiff's economic position is adversely affected. Obvious ly, we have circumstances which mitigate the infringement of copyright to some extent. In the first place, the Crown is an unusual plaintiff and really is not greatly interested in income or revenue from this work. It could never approach the cost of the inquiry which ran for several years and undoubtedly cost many millions of dollars. The printing cost associated with the work was set upon the evidence by a very rough gauge to somehow cover printing costs which, I am sure, did not take place. So, the importance of the revenue or the significance of the revenue to this plaintiff is very minimal. Furthermore, I repeat that the defendant's publication did not then and cer tainly now is not having any adverse effect on further distribu tion or sales of the plaintiffs original work and, therefore, I see no purpose in ordering a recall or injunction by enjoining the defendant from further sales of this work at this time.
It not being, therefore, a situation in which the plaintiff should be compensated or even seeks compensation in the sense of loss of revenues from the sale of its own work, and not being one where I feel at this time the distribution of the plaintiffs work is adversely affected by the presence of the defendant's work in the market-place, that injunction is not a proper remedy.
Again turning to the essential element of the defendant's transgression of the civil law, it is that it went ahead and did without seeking permission what it, in my opinion, either knew or should have known could not be done properly without permission or could not be done without some consequences without permission. It is, in my opinion, therefore, an appropri ate case for compensation not by way of injunction or damages either exemplary or punitive, but rather by way of royalty.
(Appeal Book, pages 160 ff.)
The pertinent provisions of the Act are:
17. (1) Copyright in a work shall be deemed to be infringed by any person who, without the consent of the owner of the copyright, does anything that, by this Act, only the owner of the copyright has the right to do.
20. (1) Where copyright in any work has been infringed, the owner of the copyright is, except as otherwise provided by this Act, entitled to all such remedies by way of injunction, dam ages, accounts, and otherwise, as are or may be conferred by law for the infringement of a right.
21. All infringing copies of any work in which copyright subsists, or of any substantial part thereof, and all plates used or intended to be used for the production of such infringing copies, shall be deemed to be the property of the owner of the copyright, who accordingly may take proceedings for the recov ery of the possession thereof or in respect of the conversion thereof.
In exercising his discretion to refuse the injunc- tive relief, the learned Trial Judge found persua sive the facts that the infringement had not adversely affected distribution and sales of the appellant's infringed work nor adversely affected the revenue deriving from its sales as well as the unusual character of the appellant as a plaintiff. The characterization of the Crown as an "unusual plaintiff" lies, I take it, in his finding of fact that it was not much interested in income or revenue from its work and not, I trust, in a generalization that the Crown is to be treated differently than other litigants.
The Act is clear. Infringement does not require that the infringing work compete in the market place with that infringed; it requires only that the infringer do something that the copyright owner alone has the right to do. It follows that, where infringement of copyright has been established, the owner of the copyright is prima facie entitled to an injunction restraining further infringement. It like wise follows that, where the infringing work is found to include any substantial part of a work in which copyright subsists, the copyright owner is to be deemed owner of all copies of the infringing work and all production plates and is prima facie entitled to the assistance of the Court in gaining possession of them. The onus is on the infringer to establish grounds upon which the Court may prop erly exercise its discretion against granting such relief.' Those grounds must lie in the conduct of the copyright owner, not in the conduct or motives of the infringer. The fact that the copyright owner has suffered no damages as a result of the infringe ment is not a basis for refusing an injunction. 4
A computation of damages based on an appro priate royalty is acceptable where the copyright owner does not prove he would have made the sales the infringer did. 5 However, I find no author ity for requiring a copyright owner to acquiesce in a continuing infringement against payment of a royalty. That is tantamount to the imposition of a compulsory licence. In the absence of legislative authority, the Court has no power to do that.
I am of the opinion that the learned Trial Judge applied wrong principles and erred in law in deny ing the relief sought in paragraphs (a), (b) and (c) of the prayer for relief and substituting for that relief a royalty on the future sale of infringing copies.
' Massie & Renwick, Limited v. Underwriters' Survey Bureau Limited et al., [1937] S.C.R. 265.
^ Bouchet v. Kyriacopoulos (1964), 45 C.P.R. 265 (Ex. Ct.); appeal dismissed, [1966] S.C.R. v.
Dominion Manufacturers Limited v. Electrolier Manufac turing Company Limited, [1939] Ex.C.R. 204.
The question of exemplary damages is more difficult. In addition to what has already been quoted, the learned Trial Judge [at page 25] cha racterized the respondent's conduct as a "blatant disregard of what was obviously the right of the plaintiff under our copyright laws ...". (Appeal Book, page 164.) He also found [at page 11] that "the defendant's purpose was primarily commer cial" (page 150). Taken as a whole, the findings of fact are expressed in terminology that would lead one to think that an award of exemplary damages was in the offing.
While exemplary damages are not specifically mentioned as an available remedy in the Copyright Act, they are not excluded by subsection 20(1), and it is well established that they are, in appropri ate circumstances, available. 6 I see no reason why appropriate circumstances should be different in the case of copyright infringement than in the case of any other civil invasion of another's rights. I also see no reason in this case to express a settled view on whether the applicable principle in this Court is that enunciated by Lord Devlin in Rookes v. Barnard et al.,' or that which appears to have been more generally accepted by provincial courts of appeal as enunciated, for example, by Clement J.A., in Paragon Properties Ltd. v. Magna Invest ments Ltd. 8 In my opinion, the facts here do bring this matter within Lord Devlin's second category and, on application of either principle, exemplary damages could have been awarded.
In Netupsky et al. v. Dominion Bridge Co. Ltd., 9 Taggart J.A., for the Court, in sustaining a refusal of exemplary or punitive damages, held:
I consider it sufficient to say that in this case I find absolutely no justification for such an award. I can find no fraud, malice, violence, cruelty, insolence or contemptuous disregard for the appellant's rights on the part of the respondent.
6 E.g. Underwriters' Survey Bureau Limited v. Massie &
Renwick Limited, [ 1942] Ex.C.R. 1.
' [1964] A.C. 1129 (H.L.), at pp. 1221 ff.
s (1972), 24 D.L.R. (3d) 156 (Alta. C.A.), at p. 167.
9 (1969), 58 C.P.R. 7 (B.C.C.A.), at p.42.
The grounds for refusing exemplary damages, unlike the grounds for refusing injunctive relief, are to be found in the conduct and motives of the infringer.
The absence of economic injury and the "unu- sual" nature of the Crown as a plaintiff are not good reasons to deny the Crown exemplary dam ages. The language of the reasons for judgment is difficult to reconcile with the conclusion that this is not an appropriate case for exemplary damages. It is manifest that the learned Trial Judge, not withstanding his characterization of the unques tionably deliberate infringement, motivated by the respondent's marketing considerations, as "bla- tant", did not find it warranted punishment, nor did he see deterrence as a desirable object. It cannot be said that he clearly erred in so exercis ing his discretion and I do not feel it open to substitute my view of such an infringement for his.
In denying the appellant costs, the learned Trial Judge had the following to say [at pages 24-25]:
Turning to the question of costs, I am not going to award costs, which would normally follow the event, and I have given that very extensive thought. The Crown has been justified in its pursuit of the interpretation of the copyright law as it applies to his position and has been successful. The defendant in infring ing the copyright law here, as I have said repeatedly, did without permission what it should have known required permis sion. However, it did not unfairly deal with the work, put together a fair abridgement of it, and that is upon all of the evidence, and now having been put in a position of paying the royalties that it would have on its own evidence expected to pay if it had got the permission, I don't feel it is a case where the defendant needs to be punished beyond that point by the assumption of the costs that would normally follow such a judgment.
Here again I allude to the unusual position of the plaintiff in this matter, being the Crown. Of course, there are a number of elements that are singular to this case. In the ownership of this work, in the protection of it, it is, after all, somewhat extraordi nary that we are dealing here with the protection of copyright in a work which is the obligation of the owner, and the owner does so, but it is its obligation to see that it receives the widest possible dissemination and, in concluding that the defendant in this matter went about without permission to publish a version that would be more accessible to the public, he was vindicated in that judgment by the number of purchases that would indeed have been higher had the legal difficulties not intervened, and also that the defendant did a fair abridgement of the work and, finally, that perhaps the treatment that I have given to the costs in the matter can be taken as a reflection that the defendant can at least partially be forgiven for assuming, because of the
public nature of the document involved, that the stance in respect of copyright would be somewhat less stringent than would be expected in a private work.
I have said again and again that does not excuse the defend ant for its blatant disregard of what was obviously the right of the plaintiff under our copyright laws, but I think it is a situation in which the Crown is able, without adversity, to bear its own costs and that I think it is a proper circumstance to allow a proper case to not further burden the defendant in this matter by bearing the costs of both parties.
(Appeal Book, pages 163 ff.) The Copyright Act provides:
20....
(2) The costs of all parties in any proceedings in respect of the infringement of copyright shall be in the absolute discretion of the court.
That absolute discretion is, nevertheless, to be exercised judicially. In Donald Campbell and Company Limited v. Pollack, 10 Viscount Cave L.C., in a frequently-quoted speech, said:
A successful defendant in a non-jury case has no doubt, in the absence of special circumstances, a reasonable expectation of obtaining an order for the payment of his costs by the plaintiff; but he has no right to costs unless and until the Court awards them to him, and the Court has an absolute and unfettered discretion to award or not to award them. This discretion, like any other discretion, must of course be exercised judicially, and the judge ought not to exercise it against the successful party except for some reason connected with the case. Thus, if—to put a hypothesis which in our Courts would never in fact be realized—a judge were to refuse to give a party his costs on the ground of some misconduct wholly unconnected with the cause of action or of some prejudice due to his race or religion or (to quote a familiar illustration) to the colour of his hair, then a Court of Appeal might well feel itself compelled to intervene. But when a judge, deliberately intending to exercise his discre tionary powers, has acted on facts connected with or leading up to the litigation which have been proved before him or which he has himself observed during the progress of the case, then it seems to me that a Court of Appeal, although it may deem his reasons insufficient and may disagree with his conclusion, is prohibited by the statute from entertaining an appeal from it.
The respondent, defending the denial, was able to rely only on a literal application of subsection 20(2).
It is trite law that costs are not awarded to punish an unsuccessful party. There was a time when the "rule of dignity" dictated that the Crown
o [1927] A.C. 732 (H.L.), at pp. 811-812.
neither asked nor paid costs in the ordinary course of events. That time is long past and the position of the Crown, even if it be "unusual", is no more relevant than the colour of a litigant's hair. With respect, none of the reasons given for denying the appellant costs have anything to do with the case nor any facts connected with it or leading up to it. I say that specifically of any assumption the respondent may have felt entitled to make as to the appellant's reaction to the infringement. An inno cent invasion of another's rights may be a different matter but I fail to see that a deliberate invasion in the expectation that the aggrieved party will acquiesce is a fact justifying an exercise of discre tion to the detriment of the aggrieved party.
The appellant had a clear right of action; nei ther it nor its subject-matter were trivial. The Attorney General proceeded in this Court immedi ately, expeditiously and economically. The appel lant was entirely successful at trial in all respects but obtaining a remedy the law provided. There was no proper basis for a judicial exercise of discretion denying the appellant costs.
The cross-appeal is concerned with defences raised by the respondent and rejected at trial and with the dismissal of the counterclaim. The first defence was that of fair dealing. The Act provides:
17....
(2) The following acts do not constitute an infringement of copyright:
(a) any fair dealing with any work for the purposes of private study, research, criticism, review, or newspaper summary;
The respondent says its abridgement was a fair dealing for the purposes of review. After consider ing the authorities, the learned Trial Judge con cluded [at page 11] that such fair dealing
. requires as a minimum some dealing with the work other than simply condensing it into an abridged version and repro ducing it under the author's name.
(Appeal Book, page 150)
The Trial Judge was right.
The second defence was that of public interest which is posed in the respondent's memorandum of fact and law in the following terms:
Did the Respondent's publication further the disclosure to the public of facts and material relating to alleged misdeeds or other matters of a serious nature that are of importance to the country and to the public's welfare, such that the defence of public interest applies on the facts of this particular case?
Three copyright decisions were cited in support of the defence.
In Hubbard et al. v. Vosper et al." the alleged copyright infringement involved confidential docu ments of the Church of Scientology and, in Beloff v. Pressdram Limited et al., 12 the work subject of copyright was an unpublished document. Both deal with public interest in the context of information that ought to be public and is not, which is certain ly not the situation here. The learned Trial Judge found [at page 19]:
The extent of the disclosure in the report was very great. There was no suggestion that the public was suffering under any deprivation on the part of the authors of this report or those responsible for its distribution. Free copies were given out in very large numbers, put in libraries across the country and, therefore, there is not in the circumstances of this case any justification that relates to some concern that the public might not be fully informed of the subject-matter of this inquiry. Furthermore, it seems to me that Mr. Lorimer knew that.
(Appeal Book, page 158)
I have no doubt that a defence of public interest as enunciated in the English cases is available in proper circumstances against an assertion of Crown copyright. However, the facts here do not support its application and the learned Trial Judge was right to reject it.
In Time Incorporated v. Bernard Geis Associ ates, et al., 13 a United States District Court held that reproduction, in a book dealing with the assassination of President Kennedy, of individual frames of the plaintiffs copyrighted motion pic ture film of the assassination constituted a "fair
" [1972] 2 Q.B. 84 (Eng. C.A.).
12 [1973] R.P.C. 765 (Ch.D.).
13 (1968), 293 F.Supp. 130 (S.D.N.Y.), pp. 144 ff.
use" outside the limits of copyright protection. This is not a "public interest" case in the same sense as the English decisions nor, really, in the sense the defence was advanced here. Rather the U.S. Court applied an equitable doctrine similar in scope to the statutory defence of fair dealing already discussed. The judgment deals at some length with legislation then before Congress proposing to codify the doctrine.
The third defence was based on the Canadian Charter of Rights and Freedoms [being Part I of the Constitution Act, 1982, Schedule B, Canada Act 1982, 1982, c. 11 (U.K.)], which provides:
1. The Canadian Charter of Rights and Freedoms guaran tees the rights and freedoms set out in it subject only to such reasonable limits prescribed by law as can be demonstrably justified in a free and democratic society.
2. Everyone has the following fundamental freedoms:
(b) freedom of thought, belief, opinion and expression, including freedom of the press and other media of communication;
Again, I agree with the learned Trial Judge that there is no merit in this defence. If, indeed, the constraints on infringement of copyright could be construed as an unjustified limitation on an infringer's freedom of expression in some circum stances, this is not among them. So little of its own thought, belief, opinion and expression is contained in the respondent's infringing work that it is prop erly to be regarded as entirely an appropriation of the thought, belief, opinion and expression of the author of the infringed work.
Finally, the respondent appeals against dismissal of its counterclaim. That was for damages incurred as a result of the communications by the Attorney General to those selling and distributing the infringing work. It could not succeed unless the appellant failed in its action. The appellant did not fail. The counterclaim was properly dismissed.
I would allow the appeal and dismiss the cross- appeal with costs here and in the Trial Division. The judgment of the Trial Division should be varied by striking out that part which ordered the respondent to pay a royalty to the appellant; by increasing the damages recoverable by the appel lant by the amount of royalty paid or payable under that judgment up to the date of judgment herein and by granting the relief sought in para graph (a), (b) and (c) of the prayer for relief. I would propose that the appellant move for judg ment under Rule 324 [Federal Court Rules, C.R.C., c. 663] and that judgment not issue until settled by the Court.
HEALS J.: I concur. RYAN J.: I concur.
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