Assessing Economic Impacts of Copyright Reform on Selected users and Consumers

VI. The protection of rights management information (RMI)

1. The WIPO treaties

Rights management information (RMI) is information embedded in, or affixed to copyrighted material. It identifies the persons who hold rights to that material. It frequently specifies conditions of use of a work. RMI often interacts with technical devices that control access, track usage, and handle payments.

The WCT and the WPPT call for adequate and effective legal measures to protect RMI that identifies stakeholders and RMI that relates to conditions of use against tampering. The goal is to prevent the removal or alteration of RMI without authority. The required measures must also target the distribution, import for distribut ion, communication and making available to the public without authority of works, copies of works, performances, copies of performances, phonograms, knowing that RMI has been removed or altered without authority.

The obligation to adopt legal measures applies only to acts that induce, enable, facilitate, conceal infringement of the rights covered by the treaties or by the Berne Convention (WCT only) or, with respect to civil remedies to acts where there is reasonable ground to know that they would have such effect.

Treaty obligations apply whether or not the RMI is accurate or relevant to the jurisdiction where tampering takes place, or where material that has been tampered with is distributed.

This section examines the following questions:

1. How do the digital technologies affect the so-called "balance of power" between holders of rights and users of copyrighted works?³⁵
2. What types of information should be protected against tampering?
3. Who should benefit from exceptions to anti-tampering rules?
4. What remedies against tampering are sensible from an economic perspective?

Questions 1 and 4 are examined from a general perspective. Analysis of questions 2 and 3 focuses more directly on problems faced by libraries, museums and archives (LAMs).

2. Balance of power shifts

³⁶The emergence of digital technologies, the internet in particular, has lowered the cost of copying and distributing works of authorship. It has becomes easier to bypass some providers of complementary inputs. It is not clear though, whether the new technologies have expanded the portion of the societal benefits accruing to authors or the part captured by consumers of copyrighted material.

Supporters of strong legal measures against tampering argue that the portion secured by authors has shrunk because the new technologies facilitate the illicit dissemination of protected material. They fear mass infringement and plead for extra protection to strengthen the shield provided by copyright law and technical anti-circumvention means.

Opponents of strong measures support wide-ranging exceptions to anti-tampering legislation. They claim that on-line contracting and technical devices are making fair dealing exceptions ineffective, tilting the balance of power in favor of copyright holders. In their view, adoption of strong legal measures would add to the prejudice already suffered by users.

Digital technologies have also increased sellers' capacity to engage in differential pricing. This affects the sharing of benefits between producers and users of copyrighted materials. The new technologies enhance sellers' capability to unbundle rights typically sold as bundles in the analogue world. For example, CD's cannot be distributed in a cost-effective way unless they contain a minimum number of songs. Sellers of CDs do not have the means to monitor the number of uses or to verify whether the recording is lent to others. They cannot ascertain in how many venues it is played. Therefore, sellers have no choice but to sell a "bundle" of rights that includes the right to unlimited listening and the right to lend the recording. On-line retailers by contrast have the option of selling a more limited range of rights. They can unbundle the right to copy from the right to transmit. They can offer a choice between use-based payments, lump sum payments, and payments linked to the number of computers at licensees' premises. Users who derive the greatest benefit from a work are most likely to acquire rights to the widest array of uses and make the largest payments.

But, how does the increased ability to price differentially and tailor products to individual preferences affect right holders' profits? Much of the literature argues that a seller endowed with the capacity to engage in differential pricing earns higher profits than one who must set a uniform price. This is certainly true when the seller is a monopolist. However, providers of copyrighted material are not endowed with monopoly power. Their works compete with other works. This makes for a more complex relationship between profitability and the capacity to engage in differential pricing. One can no longer maintain that an enhanced ability to price differentially generates higher profits. The reason is that each seller reaps a benefit from acquiring a capacity to engage in discriminatory pricing, but is affected adversely when rival sellers acquire the same capacity.³⁷

Unfortunately, there is no empirical study that shows which of the aforementioned effects dominates. The question how digital technologies have shifted the balance of power remains unresolved.³⁸

It is important to emphasize though that an asymmetric sharing of the gains attributable to digital technologies does not entail that if consumers have lost, right holders must have gained, or vice versa. The increase in the pie appears large enough to allow an inference that both have gained.

More importantly, there is no economic basis for arguing that if one side has lost, policy makers should redress the "imbalance". Indeed, the new technologies may affect incentives to create and disseminate in a way that justifies granting a greater slice of the pie to creators or to users. Furthermore, maneuverings with exceptions to anti-tampering legislation are hardly appropriate to achieve redress. If the new technologies justify a realignment of incentives, the shift should be accomplished by amending the scope of protection given by copyright, not by manipulating mechanisms that facilitate the assertion of rights. In order to justify exceptions to an anti-tampering rule one has to show that the rule in question encumbers the exercise of rights.³⁹

3. Types of information and legal measures

Industry Canada has asked that the report consider the following options:

• Option 1: Adoption of legal measures to protect information that identifies the work, the owner of the work, and the owner of any right in the work.
• Option 2: The protected information includes the terms and conditions of use.
• Option 3: The same as option 2 but protection extends to information that allows right holders to track use of the material.

A further differentiation is possible between information embedded by right holders and information embedded by others. Another distinction is between information that is truthful and relevant, and information that is wrong and/or inapplicable.

a) An economic perspective

Copyright holders who embed RMI in a product do so in order to enhance their ability to maximize economic returns. For that reason alone, the starting premise must be that tampering lowers the expected profit of those who have embedded the RMI. This is true for all types of RMI.⁴⁰

An economic rationale for granting exceptions to an anti-tampering rule must therefore be based on at least one of the following claims: a) that the exceptions increase the value of the material, if not necessarily the portion of the value accruing to those who have embedded it; b) that the exceptions redistribute benefits between producers and consumers in ways that accord better with the objectives of copyright law.

These conditions are necessary, not sufficient. The reason is that tampering carries the risk of accidental removal or addition of information. The latter may perturb the delicate balance of incentives that copyright law tries to achieve.

The most frequently cited justifications for exceptions to anti-tampering rules are: 1) The RMI contains wrong information; 2) some or all conditions of use contained in the RMI are not applicable to Canada⁴¹ ; and 3) manipulation of the RMI is necessary for internal management purposes.

Whether manipulation of RMI should be allowed in these circumstances depends on the following: 1) How frequent is the circumstance? 2) What is the economic cost of its occurrence? 3) What alternatives besides tampering are available to remove the circumstance?

This section addresses these questions from the perspective of libraries, archives and museums (LAMs). It asks how frequently LAMs encounter wrong or inapplicable information. Whether they can correct such RMI themselves and, if not, what alternatives are open to them? What economic costs flow from not making the correction?⁴²

From an economic standpoint, manipulation of RMI by LAMs is more easily justified when the circumstance is more frequent, when prohibiting manipulation of RMI carries a greater cost in terms of less creation and dissemination of works, and when alternatives to manipulation of RMI by LAMs are few or costly.

b) Erroneous information on stakeholders and conditions of use

There are many ways in which RMI could be off the mark. Stakeholders could be incorrectly identified, public domain works could be coded as if protected, the date of creation could be erroneous, and there could be contradictions in the terms of use.

Are such circumstances more likely to be encountered by LAMs in regard to information about stakeholders than in regard to information about conditions of use?

The responses that libraries and archives give to this question stress that information identifying a work is often wrong or incomplete. As well, the information appearing on the package sometimes contradicts the information shown on the work itself. While this applies primarily to works distributed in physical form-books, video and sound recordings-respondents do not expect information embedded in digital form to be more accurate or complete.

Libraries and archives also share the view that erroneous RIM about conditions of use is more likely to be incorrect than information identifying the work and the stakeholders.

LAMs indicate that they are prepared to put into circulation improperly or incompletely identified works. They also point out that they do not refrain from making legitimate uses that the RMI disallows. Libraries often negotiate with right holders in order to broaden the scope of uses authorized by standard licensing agreements. They seek permission to modify the RMI to make users aware of the customized conditions of use. However, they do not claim that the only means to convey such information to users is by changing the RMI.

Overall then, it does not look as if prohibiting the manipulation of RMI that identifies stakeholders and describes conditions of use will generate significant losses in terms of dissemination of copyrighted material.

Some respondents stress the fact that RMI may interfere with the internal management of collections. This problem arises more frequently when third parties rather than right holders embed RMI. RMI embedded by third parties is less likely to perturb the balance of incentives created by copyright law. This suggests that removal of such RMI by LAMs should be exempted from anti-tampering legislation.

Consider now the risks that flow from exemptions to anti-tampering rules. One cannot discount the risk that prospective tamperors will be wrong in concluding that a piece of RMI is erroneous or inapplicable. Even when they are not, there is no guarantee that the alternate RMI they will put in place will be accurate or complete. Also, establishing whether the conditions of use are relevant may require expert knowledge in the matters of copyright and commercial law that potential tamperors do not possess. And, there is no reason to presume that the economic loss from removing accurate or relevant information is less important than the benefit from correcting inappropriate information. Finally one must also consider the moral hazard issue. Allowing the "repair" of information by whoever concludes that RMI is false or inapplicable is likely to invite abuse.⁴³

Another issue is whether LAMs have the means to address problems of inappropriate RMI without resorting to tampering. The common practice in the physical world -as reported by one librarian -is to put stickers with corrected information on the material itself. The sticker may have on it both the original and the corrected information. A priori there is reason to believe that a similar approach could be adopted with respect to information embedded electronically. It is difficult to justify manipulation of existing RMI if LAM's can solve their problem by adding information without removing or altering the existing RMI.⁴⁴

These considerations remove the economic case for granting LAMs sweeping exemptions from legislation against the tampering with RMI that identifies stakeholders and specifies conditions of use. However, it is sensible to allow the manipulation of RMI embedded by third parties when it interferes with the management of collections.⁴⁵

4. Tracking information.

Tracking information allows the detection of unauthorized uses. It also generates a wealth of information about a user's interests and habits. That information helps sellers fine-tune business strategies.

The collection and commercialization of tracking information is a matter of concern because it may violate users' privacy. If one accepts the view that the protection of privacy is a concern that trumps economic considerations then, clearly, one should allow the removal of such RMI.

Interestingly, the removal of tracking codes can also be justified on economic grounds. When sellers embed tracking information they are in fact offering a tied exchange, a form of barter. They propose a product in exchange of money and tracking information. One must assume that such tying increases the value of the transaction to the seller, i.e. the party imposing the bundle. This does not entail, however, that tracking information also produces more value for buyers. And, when buyers lose more than sellers gain, there is a loss in economic efficiency. From an economic perspective then, there is no apparent reason to protect tracking information.

Should one conclude therefore that users must be allowed to remove tracking information? A risk one must pay heed to is that removal of tracking codes could lead -either by mistake or by design -to the removal of other information. A preferred approach is to require that the parties who embed tracking codes inform users that utilization of a work is monitored or could be monitored, and demand that these parties provide users with a very simple way to disable the tracking mechanism.⁴⁶ Absence of such mechanism should be sufficient to allow the removal or disabling of tracking information.

5. Specialized organizations

LAMs argue that they should be permitted to carry out the circumventions and manipulations of RMI they deem necessary to exercise rights they enjoy under fair dealing provisions. They also maintain that authorizations should extend to the specialized firms they hire to perform these tasks. LAMs worry that uses guaranteed under sections 29 to 30.5 of the Copyright Act will become theoretical if authorization is not granted.

LAMs recognize the risk that material stripped of identifying information and made available for consultation will be disseminated on the Internet. They also acknowledge that such dissemination may prejudice copyright holders. However, they do not offer a practical solution to this problem.

While not rejecting the use of specialized certifiers to manipulate RMI, most LAM's that have been consulted question the practicality of such arrangement. Some believe that it is unworkable because certifiers would be swamped by requests from a great many users. Others consider that it would be difficult to implement. A few maintain that it would be worthwhile to consider hybrid arrangements under which selected non-profit institutions manipulate specific types of RMI while specialized third parties deal with other types.

A building block of such organization may already be coming into existence in the form of identifier systems. Such system operates on the basis of unique numbers that attach to copyrighted works. A number is used to access a database to retrieve information about a work, the persons who hold rights to it, and possibly, conditions of use.

In order to link such system to an organization with the capacity to correct false or inappropriate RMI, the following is needed:1)Resources to quickly check the truthfulness and pertinence of RMI that pertains to a work; 2) trouble-free and inexpensive access to the organization by all persons who claim to have found false or non-pertinent RMI, and by persons who seek removal of RMI because it interferes with fair dealing access⁴⁷; 3) empowerment of the organization to correct and remove RMI; and 4) development of a mechanism for speedy delivery of material with RMI (and possibly technical protection measures) removed or changed.

Persons who hold rights to works included in the database have an incentive to authorize corrective manipulation by such organization. The reason is that doing so provides users a measure of comfort that the RMI is accurate and pertinent. Also, the organization may seek authorizations because it wants to provide a service akin to certification in the area of electronic commerce.⁴⁸

In a recent paper, Burk and Cohen recommend a two-pronged approach to regulate fair use access.⁴⁹ Their approach requires the design of a rights management system that detects a range of fair uses and gives limited access when fair use is detected. It is a system complemented by inputs from a trusted external party. The trusted party "would hold the keys to technologically protected works and could issue keys to applicants via an online procedure". Burk and Cohen hold that a trusted party is necessary because a purely computer-oriented system could not possibly anticipate "the range of access privileges that may be appropriate for fair uses of a particular work".

6. Remedies

Determining the best combination of remedies is, by and large, a legal matter. Both the feasibility and the desirability of alternative choices are circumscribed by generally applicable legal principles, by the possibility that tampering with RMI could fall under the ambit of other laws and possibly, by procedural matters. The contribution economic analysis can make is to provide some evaluative criteria.

The paramount consideration from an economic perspective is that RMI has no intrinsic value; its worth derives solely from its potential to enhance the value of copyrightable works. For that reason, the selection of legal measures against tampering must ultimately derive from their impact on creation and dissemination.

One objective is to maximize the authorized utilization of copyrighted works.⁵⁰ Different measures achieve this goal to various degrees. They also entail different costs, specifically, the cost of enforcement and the cost of precautions to avoid accidental removal of RMI. The optimal combination of legal measures is that which achieves the "best" balance between minimizing these costs and maximizing authorized uses.

A second consideration bears on the relationship between legal means that target infringement and legal means directed at tampering that has already led or could lead to infringement. If a chosen remedy is best against a particular form of infringement because it provides the optimal amount of deterrence, it cannot be optimal to apply a more severe measure to tampering that may lead or may have led to an identical infringement.

This does not mean that measures that target a single instance of tampering should be less severe than measures aimed at a single instance of infringement. What makes a single instance of tampering in the digital environment potentially more injurious than a single instance of infringement is the risk of wide dissemination of copies that have been tampered with. This could lead to a great many unauthorized uses. The implication is that tampering in the digital environment carries a risk of prejudice to right holders similar to the prejudice caused by commercial distribution.

Economic analysis of remedies must focus on incentives, i.e. on their likely impact on future behavior by users, copyright holders, and third parties. Remedies affect the behavior of stakeholders at several margins. They determine the precautions taken to avoid accidental tampering, they affect the nature of the technical measures taken by right holders to prevent tampering, they sway incentives to engage in deliberate tampering or deal with corrupted material, they influence decisions whether or not to prosecute.

The law and economics literature cites several circumstances that justify public prosecution of offences under criminal law. They include the following:⁵¹ 1) The victim may not have the resources to prosecute; 2) the injury may be important but so diffused among victims that no individual victim has a sufficient economic incentive to prosecute; 3) the offender cannot pay damages and consequently, the financial incentive of private persons to prosecute is lacking; and 4) there may be an intent to produce injury but no actual injury has yet occurred.

To address the question whether criminal measures are in order one must inquire whether the aforementioned circumstances are more or less likely in a case of tampering than in a case of infringement. If they are less likely, there is reason to impart a stronger slant towards civil remedies when one targets tampering. If they are more likely, the balance should tilt more heavily in the other direction.

Consider first the conditions under which tampering may occur: 1) Tampering may be accidental while making an authorized use of a work⁵²; 2) it may be accidental while making an unauthorized use; 3) it may be deliberate while making an authorized use; 4) it may be deliberate while making an unauthorized use; and 5) it may be deliberate while making no use of the work.

Also, one person may have accidentally tampered and deliberately made the material available on-line; another may have deliberately tampered for own use and accidentally put the material stripped of its RMI on-line.

The Copyright Act entitles a right holder to civil remedies that include injunctions, damages and accounts of profits against persons who infringe. However, a plaintiff is not entitled to any remedy other that an injunction in respect of the infringement if the defendant proves that, at the date of the infringement, he was not aware and had no reasonable ground for suspecting that copyright subsisted in the work.⁵³ However, this defense is not available when the copyright has been registered.⁵⁴ Damages tend to be lower when infringement is innocent than when it is unmistakably intentional.⁵⁵ The Copyright Act also makes criminal sanctions available when a person knowingly sells or rents an infringing copy, makes an infringing copy for sale or rental, imports or exhibits an infringing copy.⁵⁶ Criminal proceedings do not bar civil action.

The severity of sanctions clearly depends on whether the infringing party was aware of its violation, and on whether the violation served a commercial objective.

The severity of remedies affects economic welfare along two dimensions. When sanctions become harsher, users are increasingly willing to incur costs to ascertain the ownership of copyrights in order to avoid infringing. Because the probability of infringement cannot be reduced to zero, application of more severe sanctions also reduces the use of works. Both effects tend to lower societal welfare. At the same time though, increased sanctions can enhance authors' capacity to derive income from creative effort. When they do, they provide a benefit to society in the form of access to a greater number of works.

It is important to consider, however, that the advantage copyright holders derive from a lessening of infringements, or from reducing some types of infringements, is not necessarily a significant one. And, if the benefit to right holders is minor, there is no reason to dampen the use of works, or generate significant costs as a result of precautions taken by users.

What is interesting in this regard is that registration can serve as a marker of right holders' expected losses from infringement. It can point to the value that right holders attach to the deterrence of infringement. Because registration is inexpensive, and because the simple act of registering gives right holders a better chance of obtaining damages, one may infer from the absence of registration that right holders do not expect to incur significant losses as a result of infringement, or that they do not care greatly about deterring it.⁵⁷

By linking the expected severity of remedies to registration, section 39(2) of the Copyright Act, makes it possible to draw inferences about the importance right holders assign to the prevention of infringement from their decisions in regard to registration. This may explain why subsection 39(1) is not applicable when a registered work has been infringed.

Consider now the criminal provisions, starting with a situation where an infringing copy has been made but not distributed. If no economic losses have been suffered yet, private parties have little incentive to bring suit. Mere reliance on confiscation of the infringing copy is ineffective because the potential rewards from commercial exploitation are large compared to the value of the infringing copy.⁵⁸ More importantly, if injunctions or damages were the only remedy, deliberate copying for commercial purposes would likely have a positive expected payoff. One clearly faces a situation where the last of the aforementioned circumstances arises.

One can also make the case that reliance on mere civil remedies is insufficient when some commercial exploitation has already taken place. The reason is that users who infringe for commercial reasons are likely to infringe the works of many right holders. If so, the private expected gains from suing are likely to be much smaller than the gains to society.⁵⁹ But then, private action is insufficient to provide adequate deterrence, which could be corrected if action is taken by the state.

These observations carry several implications in terms of anti-tampering rules. Consider first the case of innocent manipulation of RMI. It is reasonable to apply the same remedies as in a case of infringement, i.e. to entitle the right holder to injunctions and damages when tampering does not serve a commercial purpose. Remedies should be limited to injunctions when the defendant proves absence of intent to engage in illegal tampering, and when the material that has been tampered with is not disseminated.

Such limitation is not desirable when the work has been registered, the more so when the RMI shows that it has been registered.

As indicated, tampering with digital material carries the risk of illegal dissemination and wide use of contaminated material. One must assume, however, that the existence of such risk was known to copyright holders when they decided to embed RMI but did not register their works. Therefore, it makes sense to treat tampering with RMI embedded in registered works differently from tampering with unregistered works.

Consider next the case of deliberate tinkering with RMI for commercial purposes, or the distribution for commercial purposes of material that has been tampered with. Again one can conclude that the reasons that justify the option of criminal remedies against commercial infringement apply equally in instances of commercial tampering or dealings in material that has been tampered with.

The case of tampering for non-commercial purposes is not as easily dealt with. The problem is that in a digital environment dissemination can be widespread even when the person who tampers has no commercial objective. Also, in many instances of non-commercial dissemination of contaminated works, the offending party may be an individual who does not have the resources to pay damages. In such case the prospect of civil action by a private plaintiff may not act as an effective deterrent against tampering. Simple cost-benefit analysis may dictate to the injured party to refrain from taking action. Indeed, the injured party would incur cost of legal proceedings immediately while chances to collect damages in the future would remain slim.

A potential answer to this problem is to provide administrative monetary penalties in situations where a person tampers with copyrighted material for non-commercial reasons and disseminates that material.⁶⁰ The penalty would be payable to the Crown and be recoverable from future earnings of the violator. The severity of the penalty would depend on the amount of injury, and on whether the violator intended to produce injury.

The legal treatment of accidental removal or alteration of RMI is of particular concern to LAMs. These organizations stress the risk of accidental tampering when extracting for legitimate purposes segments of digital material embedded in a larger whole. They claim that such accidental removal of RMI should not be subject to civil or criminal remedies. One institution argues that Canada should consider a provision similar to section 1203(5) of the Digital Millennium Copyright Act. US law provides for a reduction of awards and damages for innocent violations and orders courts to remit damages in any case where a library, archive, or educational institution sustains the burden of proving that it was not aware that its act constituted a violation.⁶¹ Such provision is sound on economic grounds.

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³⁵ The so-called "balance of power" issue has been rais ed in reports written in response to the "Consultation Paper on Digital Copyright Issues". See Consultation Paper on Digital Copyright Issues, June 22, 2001. Several reports have argued that the shift in the "balance of power" carries implications to legal measures protecting RMI.

³⁶ Publishers e.g. are alleged to lose their traditional role. They may become more valuable in a role of evaluators. See R.E. Caves, Creative Industries: Contracts between Art and Commerce, Harvard University Press, Cambridge, Massachusetts and London, England, 2000.

³⁷ Holmes (1989) shows that sellers in a 2-firm industry producing a differentiated good could be better off under uniform pricing than under third-degree price discrimination.

³⁸ Recent research shows that price discrimination is more likely to increase the profits of all sellers in an industry when competition is intense. Armstrong M. and J. Vickers, Competitive Price Discrimination, Rand J. of Economics, vol.32, no 4 , Winter 2001, 579-605. Because works of authorship often have a great many substitutes, it is reasonable to draw the inference that the increased ability to discriminate increases the rewards of copyright holders.

³⁹ Also, a lack of effectiveness of technical measures that protect RMI does not make it economically rational to provide a layer of legal protection. The latter requires that enforcement of the legal rule not be too costly compared to the cost of a market based mechanism. Introduction of legal measures lowers right holders' willingness to pay for technological means. The cost of enforcing legal measures is borne to a significant extent by society whereas the cost of technical means is borne entirely by the persons who seek to protect their works.

⁴⁰ This, however, does not imply that all types of RMI are equally valuable. Some information may not enhance value in any significant way. It may have been implanted only because the extra cost of doing so was negligible once it was decided to embed the more valuable RMI.

⁴¹ E.g. RMI that relates to public lending.

⁴² A summary of the positions taken by LAMs in regard to these issues appears as Appendix 4 to this report.

⁴³ Although one may think that the risk is lower in the case of LAMs than for private persons.

⁴⁴ The case for allowing manipulation of RMI is weakened further if such manipulation can be done on behalf of LAMs by "certified" third parties.

⁴⁵ This assumes that it is possible to tamper with one piece of information while leaving other pieces untouched.

⁴⁶ Sellers could offer users the option of access with tracking at a lower price than access without tracking.

⁴⁷ Such access is also necessary to encourage a user who comes across false RMI to report that finding. In the absence of a convenient channel to convey the information, the user will just let things go by. This would deprive third parties from the benefit of a RMI correction.

⁴⁸ The organization could also serve as a digital transfer station to download material in unencrypted form, admittance being restricted to parties that benefit from fair dealing exceptions.

⁴⁹ Burk D.L. and J.E. Cohen, Fair Use Infrastructure for Rights Management Systems, Harvard Journal of Law and Technology, Vol.15, number 1, Fall 2001, 41-74.

⁵⁰ This is not the same as minimizing unauthorized uses.

⁵¹ David D. Friedman, "Law's Order; What Economics has to Do with Law and Why it Matters", Princeton University Press, Princeton New Jersey, 2000. Also, see Robert Cooter and Thomas Uhlen, Law and Economics, Addison-Wesley, Second Edition, 1995.

⁵² Watermarks could be damaged in the process of compressing and decompressing files.

⁵³ Copyright Act, s. 39(1)

⁵⁴ Copyright Act, s. 39(2)

⁵⁵ S.Handa, Copyright Law in Canada, Buttersworth Canada Ltd.2002, page 269.

⁵⁶ Copyright Act, s. 42(1)

⁵⁷ Because the requirements in regard to originality are low and because copyright does not require registration one must assume that there exists a huge amount of material of no economic value that could be infringed.

⁵⁸ Injunctions are probably ineffective unless the offending party has infringed in the past and the law provides extra punishment for repeat offenders.

⁵⁹ The party initiating such action creates a benefit for other right holders but receives no compensation for it.

⁶⁰ Sections 74.1 and 79(3.1) of the Competition Act provide such remedies.

⁶¹ Section 1203(5) "Innocent violations. (A) general-The court in its discretion may reduce or remit the total award of damages in any case in which the violator sustains the burden of proving, and the court finds, that the violator was not aware and had no reason to believe that its act constituted a violation. (b) Nonprofit Library, Archives or Educational Institutions-In the case of a non-profit library archives or educational institution, the court shall remit damages in any case in which the library, archives, or educational institution sustains the burden of proving, and the court finds, that the library, archives, or educational institution was not aware and had no reason to believe that its acts constituted a violation."