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Monday, 16 May 2016 07:37

Expropriating Copyrights in the Public Interest? Recent Court Decision Addresses Interesting Issue

Written by  Teresa Scassa
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Can a government cut short the term of copyright protection in the public interest through a regulatory scheme? This question was considered in the recent decision in Geophysical Services Inc. v. Encana. In my previous blog post I discussed the part of the decision that dealt with whether the works at issue in the case were capable of copyright protection. In this post, I consider the regulatory expropriation issues.

Geophysical Services Inc (GSI) had argued that the government had violated its copyright in its compilations of seismic data and in its information products based on this data, when it released them to the public following a relatively short confidentiality period. The data had been submitted as part of a regulatory process relating to offshore oil and gas exploration. GSI also argued that the oil and gas companies which then used this data in their operations, without paying license fees, also violated their copyright. As discussed in my previous post, Justice Eidsvik of the Alberta Court of Queen’s Bench found that both the compilation of data and the related analytics were original works and were the product of human authorship.

The infringement issue, however, did not end with a finding of copyright in the plaintiff’s works. The outcome of the case turned on whether the government was entitled to release the information after the end of the 5-15 year confidentiality period established by the regulatory regime – and, by extension – whether anyone was then free to use this material without need for permission. The normal term of copyright protection for such a work would be for the life of the author plus an additional 50 years.

GSI was engaged in geological surveying, using seismic testing to create charts of the ocean floor. In order to engage in this activity it needed a permit from the relevant provincial and federal authorities: the National Energy Board, the Canada Newfoundland and Labrador Offshore Petroleum Board and/or the Canada Nova Scotia Offshore Petroleum Board. It was also required, as part of the regulatory process to submit its data to the relevant Boards. The process of mapping the ocean floor using seismic testing is time and resource intensive, and requires considerable human expertise. Once it was collected and compiled, GSI would license its data to offshore oil and gas exploration companies who relied upon the quality and accuracy of the GSI product to carry out their activities.

According to the regulatory regime any data or information submitted to a Board must be kept confidential by the Board for a specified period. Disclosure is governed by the Canada Petroleum Resources Act (CPRA). Section 101 of the CPRA provides that documentation submitted as part of the regulatory process is privileged and shall not be disclosed except for purposes related to the regulatory regime. In the case of data or information related to geophysical work, the period of privilege is 5 years. It was agreed by the parties that this meant that the data could not be disclosed without consent for at least 5 years. However, the plaintiff argued that its copyright in the materials meant that even if the privilege expired, the plaintiff’s copyrights would prevent the publication of its information without its consent.

In reviewing the legislative history, Justice Eidsvik concluded that it was the government’s clear intention to stimulate oil and gas exploration by ensuring that exploration companies could get access to the relevant seismic data after a relatively short period of privilege. The proprietary rights of GSI (and other such companies) could be asserted within the privilege period. According to the legislative history, this period was set as the amount of time reasonable to permit such companies to recoup their investment by charging licence fees before the data was made public. Justice Eidsvik found a clear intention on the part of the legislature to limit the copyright protection available in the public interest. The 5-year privilege period was designed to balance the rights of the copyright holder with the broader public interest in oil and gas exploration. She also found that the publication of the data was a form of compulsory licence – oil and gas exploration companies were free to make use of this data once it was released by the Boards. Essentially, therefore, the legislative regime provided for an expropriation – without compensation – of the remainder of the term of copyright protection. According to Justice Eidsvik, the inclusion of a no-compensation clause in the statute “acknowledges Parliament’s intent to confiscate private property in return for a policy it believed to be in the public interest to promote early exploration of its resources in the offshore and frontier lands.” (at para 237)

GSI argued that changes in technology combined with the high cost of collecting and processing the data had disrupted any balance that might have been contemplated in setting the original 5-year privilege period. In fact, although the legislation allows for the publication of the data after 5 years, the practice of the Boards has been to delay the release of the data anywhere up to 15 years. However, GSI still maintained that the balance was no longer fair or appropriate. Justice Eidsvik was clearly sympathetic to GSI’s arguments, but she found that as a matter of statutory interpretation the legislation was clear in its effect. She noted that it would be for Parliament to change the legislation if it needs to be adapted to changing circumstances.

The issues raised by this case are interesting. Copyright law already contains many provisions that aim to balance the public interest against the rights of the copyright holder. Fair dealing is just one example of these. In fact, the term of protection (currently life of the author plus 50 years) is another one of these balancing mechanisms. What the court recognizes in Geophysical Services Inc. v. Encana is that other federal legislation can limit the term of copyright protection in order to advance a specific public interest.

This is not the only circumstance in which copyright may be limited by laws other than the Copyright Act. Another case which has recently been settled without being resolved on the merits (Waldman v. Thompson Reuteurs Canada Ltd.—discussed in my blog post here) raised the issue of whether the open courts principle effectively creates an implied public licence to use any materials submitted to the courts as part of court proceedings. This would include documents authored by lawyers such as statements of claim, factums, and other such documents. In Waldman, these materials had been taken from court records and included in a pay-per-use database by a legal publisher.

There are other contexts in which materials are submitted to regulators and later made public as part of that process. (Consider, for example, patent disclosures under the Patent Act). The legislation in such cases may not be as explicit as the CPRA – Justice Eidsvik found this statute to be very clear in its intent to make this data open and available for reuse after the statutory confidentiality period. In particular, she cited from the parliamentary debates leading up to its enactment in which disclosure in the interest of stimulating oil and gas exploration was explicitly contemplated.

One question going forward is in what circumstances and to what extent do legislated requirements to disclose data or documents terminate copyright protection in these materials. Another interesting issue is whether a provincial government could establish a regulatory regime that effectively brings to an end the term of copyright protection (since copyright falls within federal jurisdiction). In an environment where intellectual property rights are increasingly fiercely guarded, Parliament (and the legislatures?) may need to be more explicit about their intentions to cut short IP rights in the public interest.

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