Supreme Court of Canada Confirms No Levy on MP3 Players

On July 28, the Supreme Court of Canada denied leaves to appeal a Federal Court of Appeal decision that the Copyright Board was ultra vires its authority when it applied the private copying levy to digital audio recorders, and that the levy was an unconstitutional tax. The levy, which was built into the prices of devices, such as Apple's iPod and other MP3 players, was collected on the basis that individuals ordinarily use these devices to make copies of recorded music for personal use. It is estimated that the Canadian Private Copying Collective (CPCC) collected approximately $4 million on behalf of performers, songwriters, composers and record companies, between 2003, when the levy was implemented, and December 2004 when the Federal Court of Appeal handed down its decision. The CPCC now says that the money will be returned to the importers and manufacturers of the products. The decision has potentially broad implications for the scope of the private copying exemption, which was designed to be a quid pro quo for a levy on blank audio recording media. Since the levy can no longer be applied to these devices, the exemption for copying to them may no longer apply. A recently-released UK study indicated that those who illegally share music online legally purchase four-and-a-half times more music than non-sharers. Though it remains unclear how the narrowing of the exemption might affect future file-sharing litigation in Canada, in responding to the decision, the CPCC indicated it does not intend to alienate its "best customers". For the Federal Court of Appeal decision, Canadian Private Copying Collective v Canadian Media Storage Alliance, 2004 FCA 424, visit: http://www.canlii.org/ca/cas/fca/2004/2004fca424.html For news articles, see: http://makeashorterlink.com/?K5B82158B; and http://www.metronews.ca/tech_news.asp?id=9880 For a BBC article on music file-sharing and buying habits, see: http://news.bbc.co.uk/2/hi/technology/4718249.stm Summary by: Clare McCurley and Jason Young