The Canadian Courts have not been kind to the music industry. They were one of the first to rule that copyright legislation did not give the record companies the right to subpoena, off the internet service providers, the names of web users they suspected of illegally file sharing. Now they have ruled unanimously against attempts by the country's main publishing royalties body in their attempts to make the ISPs pay a levy for music that is downloaded or streamed across the internet.
In a somewhat ambitious lawsuit, the Society of Composers, Authors and Music Publishers of Canada (SOCAN) argued that the ISPs should pay a royalty fee for music accessed via their networks, oblivious of where that music came from. SOCAN probably hoped that, if successful, they would have a relatively simple way to secure royalty payments for music distributed online, only having to target a small number of large ISP companies rather than the hundreds of websites that actually make music available - some of which would be hard to find, and some of whom actually operate outside Canada.
But the nine judges hearing the case agreed unanimously with the Canadian Association of Internet Providers who argued they could not be responsible for the content that crossed their networks. Luc Lavoie of Quebec based communications company Quebecor Inc told reporters: "There's no difference between doing this [distributing music online] or using the telephone. "You cannot blame the telephone company because criminals are speaking to one another over the phone."
However the judges hearing the case did admit that Canadian copyright law needs updating in line with the US and some European countries because it is not currently designed to cope with copyright in the internet age. They also indicated that SOCAN does have the right to force royalty payments, though the courts, on individual websites who distribute music, even if they are not actually based in Canada.
While that task will be complex, SOCAN took those indications as a positive result from the court case. Paul Spurgeon, general counsel for the association, told reporters: "We're pleased. Now we can proceed with phase two of this process to have a royalty set. We're going full steam ahead."