The Canadian Bar Association
Intellectual Property

'Regulatory fair dealing' copyright exception upheld by appeal court

An Alberta Court of Appeal decision confirms the existence of a regulatory exception to copyright protection, says Toronto intellectual property lawyer John Simpson.

The decision, which involved copyrighted seismic data, upheld a trial judge’s finding that the province’s regulatory regime allows for the confiscation and public dissemination of the data without compensation to its owner after 10 years.

Simpson, principal of IP and new media law boutique Shift Law, compares the confiscation of copyright to a government’s ability to expropriate land in the construction of public projects such as highways. 

“Copyright is not some natural right that exists. It’s created by government, and this shows that it can be taken away by them too,” he tells AdvocateDaily.com. “In this case, they considered it more important for the public to have access to this information than to give the creator of the work intellectual property rights in it.”

He says that the decision is a particular blow to copyright holders because it expands the scope of copyright exemptions beyond the confines of IP legislation.   

“Copyright law already has the fair dealing exception built into it, and IP owners would argue that it is already interpreted too broadly. But this shows there is also another sort of ‘regulatory fair dealing’ that exists outside the scope of the Copyright Act,” he says.

Alberta law requires geophysical companies that collect marine seismic data to hand over their findings to various regulatory bodies as a condition of their operation on government-owned land. The law provides for five years of confidentiality before the data is made public, although the decision notes that in practice, non-exclusive data is kept secret for 10 years.

The geophysical company that brought the lawsuit originally sought more than $2 billion in damages, alleging the release violated its copyright, and that its consent was needed for any use of its data, which is used for oil and gas exploration feasibility studies.    

In 2016, the trial judge concluded that copyright did exist in the data, a notable finding in its own right, says Simpson, because copyright does not protect ideas or facts.

However, the judge found that the skill and judgment required to extract the data about the position of rocks on the sea floor was enough to consider it “an original literary compilation work” protected by s. 3 of the Copyright Act.

Simpson says it’s similar to a photographer’s right over an image taken of a tree in nature.

“Nobody can own copyright in the tree, but there is skill and judgment involved in creating the image, which makes it a copyrightable expression of fact,” he says. “People tend to think that science is the domain of facts and data, not of artists, but sometimes the work of a scientist is akin to the creation of a work of art.”

Despite finding the copyright existed in the data, the trial judge also concluded that the regulatory regime provided a complete answer to the plaintiff’s claims of infringement and unlawful disclosure, by effectively creating “a compulsory licence over the data in perpetuity after the expiry of the confidentiality or privileged period.”

The appeal court backed up that reasoning, noting that the “confiscatory nature” of the regime was “not only Parliament’s intent, but was well-known to” the plaintiff.

“We conclude that the trial judge made no errors of law in this case. The appeal is dismissed,” the unanimous three-judge panel concluded.

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