Sunday, January 25, 2015

Labrecque c. Trudel – The Tale of a Copyright Infringement Action Gone Wrong

In Canada, a copyright infringement action may be brought before either the Federal Court or the Superior Court of a province. The Federal Court is generally favoured by litigants given its experience with copyright law. The Superior Court of Quebec’s decision in Labrecque (O Sauna) c. Trudel (Centre Bellaza, s.e.n.c.) exemplifies why that is, and also why it is prudent to assure that your lawyer is up on his or her copyright law. 

One of the photos in question
Plaintiff, a sauna manufacturer and distributer, entered into negotiations with Defendant who was seeking to purchase a sauna for a beauty/wellness center (which ultimately never opened). The deal went sour and resulted in litigation. Defendant had registered a domain name where it posted images of saunas belonging to Plaintiff; Plaintiff was posing in the photos (pictured to the left). Defendant found the images in a Google image search.

Plaintiff sued Defendant asking for $1,500 in compensatory damages and $5,500 in punitive damages. The claim was based on provisions of the Quebec Charter of Human Rights and Freedoms (Quebec Charter) and Civil Code of Quebec (C.c.Q.) dealing with the right to privacy:

Article 5 – Quebec Charter

 “Every person has a right to respect for his private life”

Article 35 C.c.Q.
Every person has a right to the respect of his reputation and privacy.
No one may invade the privacy of a person without the consent of the person unless authorized
by law.

Article 36 C.c.Q.
 The following acts, in particular, may be considered as invasions of the privacy of a person: 

(5) Using his name, image, likeness or voice for a purpose other than the legitimate information of the public.”

Gervais J. did not accept Plaintiff’s arguments based on these provisions. He found that since Plaintiff posted the images online herself, they could hardly be considered “private”. The Court did find that Defendant infringed Plaintiff’s copyright. 

In addition to more minor errors, such as equivocating between a domain name registrar and internet service provider (para. 22), or imputing a Canadian citizenship requirement for an author’s work to be protected in Canada (para. 44), the Court conflated the legal analysis for calculating damages and accounting of profits. Of course, none of this mattered in the end as the Court decided to, seemingly arbitrarily, award Plaintiff $400 in damages without justifying that calculation. The Court also cited repealed provisions of the Copyright Act (“Act”) to determine whether Plaintiff actually owned rights in the photographs, though Gervais J. did acknowledge his awareness that the provisions had been repealed. 

Since Defendant never launched a business, Plaintiff was unable to prove that it suffered losses resulting from the infringement. This would have been a perfect occasion for Plaintiff to take advantage of the Act’s new statutory damage provisions. Since these were arguably “commercial” infringements, Plaintiff would have been awarded $500-$20,000 per image, at the court’s discretion (s. 38.1(1)(a)). Electing statutory damages would also not have prevented Plaintiff from seeking punitive damages (s. 38.1(7)), though none appear to be merited in this case. 

Counsel for Plaintiff also curiously failed to ask the Court for an injunction forcing Respondent to remove the images from the website. This would have been appropriate given that Plaintiff only found out about the images from other customers asking whether Plaintiff was affiliated with the website. Plaintiff has an interest in ending that confusion.

This appears to be a case in which nearly everything that could go wrong did. While the Court rightly found that Defendant infringed Plaintiff’s copyright, the $400 damage award was entirely baseless. Gervais J. noted that Plaintiff did not prove that it suffered any damages or that Defendant made any profits. However, he states that even though he could find no quantifiable harm, the jurisprudence gives judges broad discretion on whether and how much to award a successful party in a copyright claim. Gervais J. fails to cite any authority for this statement. Upon a finding of infringement, the court does not have any discretion to refuse proven damages. Accounting of profits is an equitable remedy and it is therefore at the court’s discretion whether it should be granted; but once the court decides to allow an accounting, the manner in which the accounts are calculated should not be seen as discretionary. 

Counsel for Plaintiff’s reliance on Article 5 of the Quebec Charter and Articles 35-36 C.c.Q. was misguided. As Gervais J. rightly pointed out, the right to privacy under Article 35 C.c.Q. and Article 5 of the Quebec Charter cannot be engaged when the information (or in this case image) is already in the public domain. This is consistent with the Supreme Court of Canada’s 2004 decision in Gilles E. Néron Communication Marketing Inc. v. Chambre des notaires du Québec.

The Court found as a matter of fact that Defendant had no malicious intent in using Plaintiff’s images and that they were not trade competitors. The claim for punitive damages was therefore rightly recognized by the Court as unwarranted. 

Failing to ask for statutory damages was a major oversight. It was obvious that no real injury occurred. Since Defendant never launched a business, it is debatable whether it was truly a “commercial infringer”. In any event, Plaintiff would have been entitled to damages under s. 38.1(1) of the Act. 

By far the funniest paragraph in the decision (para. 22) is where Gervais J. relays Defendant’s testimony regarding its domain name registration. Defendant testified that since it signed a three-year contract with the “internet service provider”, it could not remove the content before that time was up. Such a counter-factual argument did not, however, noticeably diminish Defendant’s credibility with the Court considering Gervais J.’s low damage award.