Canadian Recording Industry Giants Face Class Action Copyright Infringement Suit

In October 2008, the estate of renowned jazz musician Chet Baker commenced a copyright infringement action in the Ontario Superior Court against Warner Music Canada, Sony BMG Music Canada, EMI Music Canada, and Universal Music Canada (Defendants), and sought to certify the lawsuit as a class action, with many popular recording artists as plaintiff class members (The Estate of Chesney Henry “Chet” Baker et al v Sony BMG Music (Canada) Inc et al, court file CV 0800 360651 00CP). The complaint arose from the established practice in the Canadian music industry of using musical works in compilation CDs or live recordings, without first securing the necessary copyright licences. Record labels simply placed the music and artist on a “pending list”, to later sort out copyright clearance and royalty payments. This practice began in the 1980s when the Canadian copyright law changed from a compulsory licensing system to the current regime. Since then, the pending list has ballooned to contain over 300,000 works. If the Court finds that the pending list is an admission of liability to those recording artists who are unpaid, the outcome could prove to be expensive for the recording industry. The plaintiffs seek the option of statutory damages under the Canadian Copyright Act, making the Defendants potentially liable for a judgment exceeding $6 billion (at a maximum of $20,000 per infringement, though the amount of royalty actually owed on some music could exceed this amount). An additional feature of the litigation is a claim for punitive damages, a claim buttressed in part by the assertion that the Court should take into account an aggravating factor: the alleged unforgiving approach by the Defendants in enforcing their copyright interests against Canadian consumers. Follow this link to a news article on the litigation from: The Toronto Star For a commentary on the impact of the lawsuit on the Canadian Recording Industry Association, visit: http://tinyurl.com/yc3ruoh Summary by: Janet Chong