Motion Record of Distributel Communications Limited

Court File No.: T-2062-12

FEDERAL COURT

BETWEEN:

NGN PRIMA PRODUCTIONS INC.

AND RIDING FILMS INC.

Plaintiffs

-and-

JOHN DOE AND JANE DOE

Defendants

MOTION RECORD OF DISTRIBUTEL COMMUNICATIONS LIMITED (Response to motion for leave to conduct examination for discovery of non-party)

FASKEN MARTINEAU DuMoulin LLP Barristers and Solicitors Suite 1300, 55 Metcalfe Street Ottawa, ON KIP 6L5

Gerald (Jay) Kerr-Wilson (LSUC# 41507H) Marisa E. Victor (LSUC# 52065B) Tel: 613-236-3882 Fax:613-230-6423

Lawyers for the Distribute! Communications Limited

TO:

The Administrator Federal Court Thomas D' Arcy McGee Building 90 Sparks Street, 5th Floor Ottawa, ON KIA OH9

AND TO:

Me Greg Moore 2200-2000 McGill College Montreal, QC H3A 3H3

Lawyer for NGN Prime Productions Inc. and Riding Films Inc.

AND TO:

Access Communications Co-operative Limited 2250 Park Street Regina, SK S4N 7K7

AND TO:

ACNinc. 1100 Ave. des Canadiens-de-Montreal, Suite 450 Montreal, QC H3B 2S2

Tab

1.

2.

3.

4.

5.

6.

7.

8.

A.

B.

TABLE OF CONTENTS

Document

Affidavit ofDaniel Puckett, Sworn February 7, 2013

Exhibit A to Daniel Puckett Affidavit - Customer Letter

Exhibit B to Daniel Puckett Affidavit- CRTC Data

Affidavit of David Zvekic, Sworn February 7, 2013

Written Representations

Excerpt from the House of Commons Debates, Hansard, October 18, 2011

Industry Canada Fact Sheet on Copyright Remedies, October 26, 2011

Copyright Act, (RSC, 1985, c. C-42), s. 38.1

PIPEDA s. 3, 5, 7(3)(c), 8(8) and s. 28

Rule 238(3)(d) of the Federal Court Rules


BETWEEN:

FEDERAL COURT



-and-


AFFIDAVIT OF DANIEL PUCKETT Sworn February 7, 2013

I, Daniel Puckett, ofthe City of Toronto, MAKE OATH AND SAY:

Background and Qualifications

Plaintiffs

Defendants

1. I am Vice President and Chief Information Officer (CIO) of Distribute} Communications Limited (Distribute!). I have been employed by Distribute} since 1990 and have personal knowledge of the matters herein.

2. Within this affidavit where I refer to "we" or "Distribute}" I refer to myself or staff under my direction whose duties and performance I have personal knowledge of.

3. Distribute} has been in business since 1988 and has provided Internet access services since 1997.

0001

4. As CIO of Distribute! my responsibilities and day to day activities include: a. reporting to the Management board; b. providing technology vision and leadership in the development and

implementation of Distribute! corporate j affiliate wide Information Technology (IT) and Information Systems (IS); and

0002

c. providing vision and leadership in the development and implementation of Information & Assets, Corporate Security and the Prevention of Wrongful Loss Systems, and in certain cases regulatory compliance.

5. As Vice President and Management Board Member of Distribute!, I am called on to lead projects or perform tasks that may be unrelated to IT /IS/Security in general. Such projects or tasks may involve other corporate management or staff in a variety of roles.

6. As Director of various Distribute! affiliates or subsidiaries (Xinflix Media, Acanac), I am called upon to provide direction and to oversee the operations of identified entities and to perform the required duties of that office.

7. I also directly supervise and manage several departments and groups that are responsible for Strategic and Tactical Planning, Development, Evaluation and Coordination of IT /IS systems and services in accordance with objectives as defined and prioritized by the Management Board.

a. IT /IS Systems include, but are not limited to, the Systems and Processes in place that provide business with the tools of conducting business. It includes workstations, telephones, cell phones, LANs, W ANS, firewalls, routers, data storage, data retrieval, data archiving, data back ups, portable data devices, printers, fax machines, scanners, commercial software, custom software, support contracts, suppliers of services, web servers, email communications, ticketing systems, voicemail, call queuing, document management, web services, billing systems, costing systems, invoicing systems, and accounting systems.

8. Additionally, I am responsible for the security of company Information & Assets and the Prevention of Wrongful Loss and Security systems including Physical Plant Security, Electronic Data Security, Physical File Security, Building Security Liaison, and Security staff.

a. Wrongful Loss includes theft of equipment, services, unauthorized access, non-ordinary business exposure to liability such noncompliance with regulations and standards, especially regarding 911, and issues of safety and fraud.

9. Within all these areas my responsibilities include:

a. Approve, coordinate and control all projects related to selection, acquisition, development and installation of IT /IS systems for corporate I affiliates.

b. Develop and maintain corporate policies and standards aimed at maximizing effectiveness and minimizing costs related to the acquisition, implementation and operation of IT /IS systems.

c. Develop, monitor, and approve annual operating and capital budgets for IT /IS and other responsible areas as required

0003

d. Maintain knowledge of current technology, equipment, prices and terms of agreements. Develop the technology vision and planning process that will regularly evaluate new technologies and recommend changes.

e. Maintain problem logs, documenting system errors or defects.

f. Develop, communicate and enforce policy and procedures to ensure the integrity, security and privacy of information entrusted or maintained.

g. Ensure that all IT /IS systems and networks operate according to internal standards, external compliance standards, regulatory agencies and legal requirements.

h. Ensure that appropriate levels of staff are available to support and maintain the corporate I affiliate IT /IS and other systems.

10. Further, I have been engaged in computer software design for 34 years, since 1978 coinciding with the general availability of personal computers. I possess the knowledge and skill to write software in several languages including but not limited to C, C++, Basic, Delphi, Visual Basic, SQL, Bash, Perl, PHP as well as have developed in Object Oriented Programming, Real-time programming, Multitasking I Parallel programming and Finite state machine modeling environments.

11. I possess the knowledge and skill to develop and operate in several Internet and Communication standard environments including but not limited to: Integrated System Digital Network (ISDN) Q.91, Transport Control Protocol 1 Internet Protocol (TCP /IP), User Datagram Protocol I Internet Control Message Protocol (UDP /ICMP), Advance Intelligent Network (AIN) Bellcore GR 1298; FR15, Transaction Capabilities Application Part (ss7) TCAP, Voice over IP I SIP communications.

12. I have attended numerous process improvement and technology training

courses in Directing, Controlling and Managing projects; Object-Oriented Analysis and design; Voice on TDM and IP Networks; Voice in IP networks; Network Design; and Security.

IP Addresses

13. For the purposes of this affidavit, I use the term IP address to refer to a numerical identifier assigned to a computer or computers in order to permit them to communicate information over a network using the Internet Protocol (IP).

0004

14. An IP address does not refer to a person. It is not analogous to a driver's licence or a Social Insurance Number or an email address, which usually refer to a specific or single person. In normal usage a single IP address may be in use by multiple persons, be they sharing a household network, an office local area network, wireless Internet coffee shop, or not in use by any person at all.

15. Distribute! offers Internet connectivity to its residential end users through 3 separate technologies. The first technology used is dial access also known as "Dial-up Internet" (DA) using an analogue modem operating on a standard phone line. This method of communication occupies the telephone line during data transmissions and as a result, the telephone line is not available for any voice telephone calls.

16. The second technology is Digital Subscriber Line access (DSL). Under this method Distributelleases connections to the customer's premises on telephone lines that the telephone company has connected to special equipment that allows the carriage of high speed data while simultaneously allowing the telephone line to be available for ordinary voice telephone calls. Distribute! has lease arrangements with local telephone companies such as Bell Canada or Tel us Communications.

17. The third technology is Third Party Internet Access (TPIA) over cable. Under this method Distribute! leases connections to the customer's premises on the local cable television company's lines. These lines have been connected to special equipment that allows the carriage of high speed data while simultaneously allowing the line to be used for television signals as well. Distribute! has lease arrangements with several local cable television companies such as Videotron, Rogers, Cogeco, and Shaw.

18. In order to facilitate Internet connectivity, Distribute! reserves certain blocks of IP addresses for use by its DSL Internet customers; certain blocks for use by its cable Internet customers served under TPIA agreements; and certain blocks for use by its DA Internet customers; and finally other blocks for its internal and corporate use.

0005

19. In the cases of DSL and DA these addresses are assigned using a local pool method where the customer's equipment provides a set of access credentials and if correct, Distribute! equipment issues an available IP address from a list of unused IP addresses. In the case of TPIA, the cable company assigns an available IP address using the Dynamic Host Configuration Protocol (DHCP).

20. Both methods of address assignment, local pool and DHCP, result in any particular connection receiving any available IP address that has been reserved for that type of connection. It also results in any particular IP address being assigned to multiple customers' computer equipment over a period oftime. Party 1 may turn on his computer equipment and be assigned IP address A which he then uses while accessing the Internet. He may then turn his computer equipment off and back on and be assigned IP address B. One moment later Party 2 may turn on his computer equipment and be assigned IP address A

21. Where the IP address has been reserved for use by DSL or DA services, Distribute! is able to identify the customer account which is associated with that IP address if Distribute! is provided with the exact IP address, exact date, and exact time. This is the case unless Distributel's information has been lost or purged. Distribute! purges records when they are no longer required for its business purposes. Distribute! does not use this information for billing purposes.

22. Where the IP address has been reserved for use by cable Internet services, the IP address assignment is performed by the TPIA operator. Distribute! is able to identify the cable operator that performed the assignment but does not know which customer account is associated with which assignment. Only the TPIA operator has this information. That TPIA operator should be able to identify the customer account which is associated with that IP address if it is provided with the exact IP address, exact date, and exact time, unless the TPIA operator's information has been lost or purged.

Accurate Time

23. I have reviewed the Exhibit 'A' referred to in the Affidavit of Barry Logan. In that Exhibit I observe a column labeled "HitDateUTC." I believe this entry indicates a timestamp created by the computer operated by Barry Logan expressed in Coordinated Universal Time (UTC) when it detected the IP address given in the column labeled "IP Address."

24. UTC is a standardized time zone and time most closely resembling Greenwich Mean Time (GMT) except that GMT is not precisely defined. UTC is based on International Atomic Time which is the absolute standard by which clocks may be measured against for accuracy.

25. Computer clocks drift. They can drift from their set time due to temperature fluctuations, electrical current flow variations and magnetic interference from other components. I have personally observed clocks on high quality main boards lose or gain 2 minutes in one hour of operation As a result, computers that generate critical timestamps are routinely configured to constantly check their time against a known to be accurate time source. The time sources are called Time Servers and use the Network Time Protocol (NTP) to provide accurate time to requesting machines.

26. Distribute! has not routinely considered the Radius equipment logs, which we employ to create logs that are used in the correlation of an IP address to a customer account, to be critical. As previously stated, Distribute! does not use these logs for billing purposes. We know that we have a routine drift, between the 4 machines that can generate such records, to vary in time by as much as 2 seconds from accurate time sources.

2 7. Only if Distribute! knows the exact time differential between the clock of Barry Logan's computer and the clock of Distributel's DHCP services would we know how the timestamp indicated in the column "HitDateUTC" relates to Distributel's records.

28. No information as to the clock synchronization state at the time of creation of the logs in Exhibit "A" has been provided. Without this information Distribute! is not able to reliably identify the customer account assigned that IP address at the time of the log's creation.

Geographic Region

29. In that same Exhibit "A", I observe a column labeled "city", which in Barry Logan's Affidavit, paragraph 23 is described as "a particular geographic region" of the IP address that he has 'tracked' to a peer and a particular ISP.

30. I can confirm that at the 'HitDateUTC'listed in Exhibit "A", only one of the IP addresses of Distributel's DSL services were assigned to a customer account in the listed 'city'.

31. It is possible that at a different time these IP addresses were all assigned to customer accounts in those cities since, as previously stated, Distributel's IP addresses are frequently assigned from one customer account to another.

Retrieving customer information

32. The steps required to identify a customer name and address in association to an IP address include sequentially querying and examining the results of four Radius servers, one IP address allocation database.

0006

33. The queries, and the analysis of the results of the queries, must be performed by a trained technician. The results of his work must be re-verified by a separate independent set of queries performed by a separate and equally trained technician.

34. The process above results in: no information found; a set of authentication credentials; or an indication that the IP address is allocated to a particular TPIA cable operator.

35. This result is then passed on to a separate staff member in the Privacy Office. This trained staff member will perform queries against one or more of several customer administration systems. After analyzing the results of these queries, this staffmemberwill have an established hypothesis ofwhich customer was associated with the provided IP address at the date and time provided. The process is then repeated to ensure accuracy and consistency in the results.

36. Once the Privacy Office is satisfied that the retrieval was performed in a manner consistent with the policies and practices approved by me, then that information may be provided to the requesting agency or party.

Prior Motion

37. On November 14, 2012 Distribute! was notified of a Motion to be heard by the Federal Court on November 19, 2012 to order the disclosure of information, specifically the customer names and addresses associated with 27 IP addresses. At that time we did not oppose the Motion as it had been standard practice for Distribute! to rely on the Court to protect the privacy rights of the individual.

38. On November 21 we received the Court order requiring the disclosure of the customer names and addresses associated with 27 IP addresses. On November 22 Distribute! provided 4 names associated with 11 of the IP addresses and an explanation that the names and addresses of 17 of the IP addresses were unknown to Distribute! as the IP addresses were allocated to TPIA providers.

39. Subsequent to the release of the information, on December 8, 2012, one of the customers included in the 4 above contacted our Privacy Office. He was seeking assistance in defending himself from the demands of a letter that he received from the Plaintiff. In that letter the Plaintiff provided notice to the John Doe that he could face penalties of up to $20,000 and that the Plaintiff has evidence that the John Doe had made an infringing copy of the movie Recoil. The Plaintiff offered to settle with the John Doe in exchange for $1500. The letter is attached as Exhibit A to this affidavit.

0007

0008

40. The letter caused us at Distribute} to have some concern as to the Plaintiffs fair treatment of the John Doe. When we examined the information provided in the Plaintiffs Motion, we saw no evidence that a complete copy ofthe movie was ever in the possession of the John Doe. Nor any evidence that the John Doe's computer exchanged any data with any computer other than that of the Plaintiff.

Independent ISPs

41. The Canadian Radio-television and Telecommunications Commission (CRTC) produces an annual report on the communications industry available online.

42. The most recent edition, Communications Monitoring Report September 2012, gives statistics on the degree of competition in the internet sector. Excerpts from this report are attached as Exhibit B to this affidavit.

43. Collectively, Independent Internet Service Providers (ISPs) like Distribute}, Access Communications Co-operative Limited and ACN Inc. garnered 6.7% of the 2011 revenues for residential internet access services (CRTC report Table 5.3.1), from 7.6% of the subscribers (CRTC report Table 5.3.2). The other 93% share was held by the large incumbent telephone and cable companies, such as Bell Canada, Rogers and Videotron. Independent ISPs face some very powerful competitors, and our low market share numbers reflect this.

44. Furthermore, in Distributel's response to the order granted as a result ofthe previous Motion brought by the Plaintiffs, 17 IP addresses were identified as requiring investigation from the Cable companies. The current motion is a request for new Distribute} customer identities, despite there having been no follow up request by the Plaintiffs for an order to compel the cable companies to provide customer data for the IP addresses we identified as being within their purview in response to the previous motion.

45. We are concerned with the Plaintiffs' apparent selectivity. Were the actions of the Plaintiffs' non-prejudicial or non-selective, there would surely have been Motions brought against the large incumbents, since their customers comprise 93% of the total. Moreover, they would have followed up on their first set of IP addresses with the cable operators we identified before bringing a further motion for new alleged infringers.

46. These actions for disclosure of confidential customer information have been well publicized, and will likely continue to be so. Canadians value their privacy. Should the notion become widespread that customers of independent ISPs are more likely to be targeted for disclosure, it could negatively impact the ability of independent ISPs, already fighting against

much stronger competitors, to attract customers. This is of significant concern to Distributel's management and me.

SWORN BEFORE ME at the City of

Ottawa, in the Province of Ontario, this 7th day of February, 2013

) ) )

)~·. ) DANIEL PUCKETT )

--~~--~~~~--+-------------)

the Province of Ontario

Christophii'Jahn Plul~. , Commissioner, aiD., ....-.ara.at. whileaSt~. Expires August 14, 2C)1S.

0009

This Exhibit "A" attached to and forming part of the Affidavit

of Daniel Puckett sworn before me this ih day of February, 2013.

Chilstuplaolahn Paul ~II .~ Commissioner. ate., PRN~•af~ while a Student-at-Law. ~xpires Ai.!!;J,U$l 1.4, 2015.

0010

-

Goudreau Gage Dubuc SE.N.C.R.L • LLP.

T514.397J602 F 514.397.4382

2000. McGill College #2200

Montreal {Quebec) Canada H3A 3H3

www.ggd.com

Goudreau Gage Dubuc PROPRlETt INTELLECTUELLE

INTELLECTUAL PROPERTY

Direct dial: (514) 397-7485 Email: gmoore!:d.com Our Ref.: J

2 ·.

11)

On met vos idees a t'abri· A home for your ideas·

November 27, 2012

Subject: Copyright Violation via P2P network

Dear Sir,

We are the attorneys for NGN PRIMA PRODUCTIONS INC., the owner of the copyright in the motion picture Recoil.

Our client is concerned about the unlawful file-sharing of its work over peer-to-peer ("P2P") networks. This practice reduces income for all of those who are involved in the production of its films and limits its ability to invest in new projects.

To help address this issue, NGN PRIMA PRODUCTIONS INC. instructed a software company to identify instances when Recoil was made available for download on P2P networks without its consent.

Evidence was obtained demonstrating that the following IP addresses were used to copy an unauthorized copy of Recoil and to make it available for download using the BitTorrent protocol:

IP Adresses I Dates and Times

As owner of the copyrighted work, NGN PRIMA PRODUCTIONS INC. then obtained an Order from the Federal Court of Canada, which required that Distribute! Communications identify the customer who used these particular IP addresses on those dates. You were identified as the subscriber associated with these IP addresses.

0 0 11

~··.

r t.· f

Goudreau Gage Dubuc 2

PROPRIETE INTELLECTUELLE


Your actions

Since you have been identified ~ tije subscriber associated with the relevant IP addresses, NGN PRIMA PRODUCTtONS INC. believes that you have infringed its copyright by:

making a copy of Recoil on your computer without authorization; and

making a copy of the film available to be downloaded by others.

NGN PRIMA PRODUCTIONS INC. is in a position to include you as a defendant in Federal Court File T-2062-12. In that case (a copy of the statement of claim is attached for your reference), our client is seeking compensation for the unauthorized copying and distribution of its film over P2P networks, along with the reimbursement of the costs incurred to enforce its rights. You have not yet been named as a defendant in this case and you do not need to contact the Federal Court. If NGN PRIMA PRODUCTIONS INC. succeeds, the Court would establish the amount to be paid.

Offer to settle

. NGN PRIMA PRODUCTIONS INC. would prefer to reach an amicable settlement with you, avoiding the additional time and costs of litigation.

Should you accept to settle this matter, NGN PRIMA PRODUCTIONS INC. would agree not to commence proceedings against you, in exchange for the following commitments:

1) you would be entitled to keep one copy of Recoil for your private use;

2) you would agree not to copy the film and to stop making it available to others, whether by way of P2P networks or otherwise;

3) you would compensate NGN PRIMA PRODUCTIONS INC. by sending a cheque to our firm for $1500, which represents:

damages caused by the unauthorized and unlawful copying and distribution of the film;

legal costs, including amounts to prepare the court materials filed to date and to attend at court to obtain the order referred to above; and

the administrative fees charged by your ISP to comply with the court order.

00 !12

..

Goudreau Gage Dubuc PRO.PR I ETE I NTE LL EC TU ELLE


0013

3

Should you not agree to these terms, NGN PRIMA PRODUCTIONS INC. reserves its right to seek a higher amount by adding you as a defendant in Court File T-2062-12. The Copyright Act allows the court to assess statutory damages anywhere between $1000 and $20,000. We are awat~ of two cases1 where the court awarded $5000 per film to compensate for copyright Infringement, and of one case2 where the court awarded $1000 for each of 14 films that were copied and distributed without authorization. In each case, the court also ordered that additional amounts be paid to cover costs and interest.

In addition, a bill before the Canadian Parliament would allow copyright owners to recover up to $5000 for non-commercial infringements.3

If you are willing to conclude a settlement agreement according to these terms (which is a legally binding contract), kindly sign the document attached to this letter and return it to us with a cheque for $150J payab;e to "Goudreau Gage Dubuc LLP, in trust", and quoting reference number on the back. We advise you to keep a copy for your records.

We recommend that you seek independent legal advice and, if you dispute our client's allegation of copyright infringement, that you explain your position to us as soon as possible.

If you do not accept the offer to settle or explain why you dispute these allegations of copyright infringement within 15 days following the date of this letter, our client reserves its right to proceed against you.

We look forward to hearing from you.

Yours very truly,

GOUDREAU GAGE DUBUC LLP

Gre~r:z -GM/sb

Enclose: Statement of Claim Settlement Agreement

1 Film City Entertainment Ltd. v. Golden Formosa Entertainment Ltd., 2006 FC 1149; Film City Entertainment Ltd. v. Chen, 2006 FC 1150. 2 L.S. Entertainment Group Inc. v. Formosa Video (Canada) Ltd., 2005 FC 1347. 3 Bill C-11, An Act to amend the Copyright Act, I st Sess., 41 51 Pari., 20 II, cl. 46.1.

Reference number: L:e .::zJ Goudreau Gage Dubuc LLP 2200-2000 McGill College Montreal, Quebec H3A3H3

SETTLEMENT AGREEMENT

Re: NGN PRIMA PRODUCTIONS INC., Recoil ("the film")

Dear Sirs,

In return for an agreement by NGN PRIMA PRODUCTIONS INC. not to commence proceedings against me in relation to the matters set forth in your letter of November 27, 2012, I agree:

1) not to copy the film and to stop making it available to others, whether by way of P2P networks or otherwise;

2) to pay $1500 to "Goudreau Gage Dubuc LLP, in trust" to compensate NGN PRIMA PRODUCTIONS INC. for its damages and costs.

I shall be entitled to keep a single copy of the film for my private use.

I understand that this is a legally binding contract between me and NGN PRIMA PRODUCTIONS INC. and I have had the opportunity to seek independent legal advice.

Signature:

Name: -------- (please print)

Date:

0014

BETWEEN:

TO THE DEFENDANTS:

Court File No. T- ,;}Q;:2- /;J.

FEDERAL COURT

SIMPLIFIED ACTION

NGN Prima Productions Inc.

-and-


STATEMENT OF CLAIM

Plaintiff

Defendants

A LEGAL PROCEEDING HAS BEEN COMMENCED AGAINST YOU by the Plaintiff. The claim made against you is set out in the following pages.

IF YOU WISH TO DEFEND THIS PROCEEDING, you or a solicitor acting for you are required to prepare a statement of defence in Form 171B prescribed by the Federal Courts Rules, serve it on the plaintiff's solicitor or, where the plaintiff does not have a solicitor, serve it on the plaintiff, and file it, with proof of service, at a local office of this Court, WITHIN 30 DAYS after this statement of claim is served on you, if you are served within Canada.

If you are served in the United States of America, the period for serving and filing your statement of defence is forty days. If you are served outside Canada and the United States of America, the period for serving and filing your statement of defence is sixty days.

Copies of the Federal Courts Rules, information concerning the local offices ofthe Court and other necessary information may be obtained on request to the Administrator of this Court at Ottawa (telephone 613-991-4238) or at any local office.

0015

0

IF YOU FAIL TO DEFENP THIS PROCEEDING, judgment may be given against you in your absence and without further notice to you.

(Date):

Issued by:

NOV 14 2012

Reg~

TAGRIPAKL ru::C:aStRY t>:FFlCER AGENT DU GR.E.FFE

THE FEDERAL COURT OF CANADA 30 McGill College Montreal, Quebec H2Y 3Z7 Tel. 514-283-4820 Fax 514-283-6004

TO: John Doe and Jane Doe Adressesses unknown

This Exhibit "B" attached to and forming part of the Affidavit

of Daniel Puckett sworn before me this i 11 day of February, 2013.

Chiretopla Jam Paul 06pztll~11 Commissioner, ate., Pravlnc8 afOiillto. while a Student-at-law. Expires August 14, 2015.

0017

I+ I Canadian Radio-television and Telecommunications Commission

Conseil de Ia radiodiffusion et des telecommunications canadiennes

Communications Monitoring Report September 20 12

www.crtc.gc.ca

0018

Canada

This publication is only available electronically: http://www.crtc.gc.ca

This publication can be made available in alternative format upon request.

Ce document est egalement disponible en franr;ais.

Catalogue No. BC9-9/2012E-PDF

0019

... -5 0

Communications Monitoring Report- Section 5.3

Statistical information -Internet market sector

Table 5.3.1 Internet revenues($ millions)

2007

Incumbent TSPs (excluding out-of- I territory)

Dial-up High-speed

Subtotal Cable BDUs

Dial-up

High-speed Subtotal

Incumbent TSPs (excluding out-ofterritory) and cable BDUs subtotal

Dial-up High-speed

Subtotal Other TSPs

Dial-up High-speed

Subtotal Total

Dial-up High-speed

Residential total Incumbent TSPs (excluding out-ofterritory) Cable BDUs Incumbent TSPs (excluding out-ofterritory) and cable BDUs subtotal OtherTSPs

Incumbent TSPs (out-of-territory) Resellers,utility telcos, and other carriers

Other TSPs subtotal Business access total Business transport total Business total Higher capacity access and transport Lower capacity access

Wholesale total

Applications, equipment, and other Internet-related services

Grand total

141 1,331 1,469

5 1,935

1,940

145 I 3,264 I 3,409

83 128 214

228 3,394 3,622

434

169

604

112

223

335 938

73 1,011

54 147

201

778

5,613

2008

116 1,406 1,522

2

2,129 2,131

118 3,535 3,654

71 175 245

189 3,710 3,899

457

201

657

98

241

339 997

76 1,073

54 I 161

215

939

6,126

2009

92 1,506 1,598

I 2,419 2,420

93 3,925 4,018

48 219 267

141 4,144 4,285

444

227

671

93

255

348 1,019

67 1,086

48 213

261

868

6,499

I

I

2010

64 1,588 1,652

I 2,572 2,573

65 4,160 4,225

31 282 313

96 4,442 4,538

478

284

762

81

282

364 1,125

77 1,202

42 218

260

772

6,772

2011

I 46 1,732

I 1,778

2,811 2,811

47 4,543 4,590

I

I

growth 2010-2011

-21.8%

9.1%

7.7%

-40.1%

9.3%

9.3%

-28.0%

9.2%

8.6%

23 -28.0%

310 10.0%

• 332 ~ 6.3%

69

~ ~ C:4,923 ~

481

309

790

81

272

353 1,142

52 1,194

53 266

319

766

7,202

-27.8%

9.3%

8.5%

0.8%

8.7%

3.7%

-0.5%

-3.8%

-3.1% 1.5%

-32.4% -0.6%

26.4%

21.7%

22.5%

-0.7%

6.3%

2012

CAGR 2007-2011

-24.3%

6.8%

4 .9%

-38.7%

9.8%

9.7%

-24.7%

8.6%

7.7%

-27.7%

24.7%

11.7%

-25.7%

9.4%

8.0%

2.6%

16.2%

7.0%

-7.9%

5.1%

1.3% 5.0% -8.2% 4.2%

-0.4%

16.0%

12.2%

-0.4%

6.4% • Wholesale Internet access and transport services are generally sold to ISPs. These services are used by the ISPs to provide nternet access service to

their retail customers. Sales to non-ISP entities, such as VoiP service providers, are included in the wholesale revenues pr ented in Table 5.3.1 as "Higher capacity access and transport" revenues.

• "Lower capacity access" includes services such as Bell Canada's GAS, TCC's VPOP, DSL, and cable BDU-provided TPL service, as well as satellite capacity and dial-up btmdled with Internet access sold to ISPs. In previous years, modem rental fees for residential service were included with Internet access service revenues. Howeve the fees are no longer included as of2008. In 2008, the fees were approximately $121 million.

I. Due to changes in company reporting, the business transport total in 20 II is not comparable to previous years. Source: CRTC data collection

$332M I $4,923M = .0674 -> 6.7% 148

Excerpt from http ://www.crtc.gc.ca/eng/publications/reports/PolicyMonitoring/2012/cmr2012. pdf Page 148, table 5.3.1 referenced in Affidavit

0020

Communications Monitoring Report- Section 5.3 I 2012 Q Q 21 Table 5.3.2 Residential Internet subscribers, by type of TSP (part 1 of 2)

2007 2008

Incumbent TSPs (excluding out-of-territory)

Dial-up 566 % annual growth -11 .8 -23.5

%share of total dial-up 60.6 59.1

High-speed 3,405 3,584 %annual growth 10.0 5.3

%share of total high-speed 40.7 39.5

Subtotal 3,971 4,017 % annual growth 6.3 12

%share of total 42.7 40.9

CableBDUs Dial-up 18 18

% annual growth -53 .8 1.9

% share of total dial-up 1.9 2 .4

High-speed 4,573 4,990 %annual growth

1 13.2 9.1


Subtotal 4,590 5,008 % annual growth 12.5 9.1

% share of total 49.5 51.1

Incumbent TSPs (excluding out-of-territory) and cable BDUs subtotal

Dial-up 584 451 % annual growth -14.1 -22.8

% share of total dial-up I 62.5 61 .6

High-speed 7,978 8,574 %annual growth 11 .8 7.5


Subtotal 8,561 9,024 % annual growth 9.5 5.4

%share of total 922 92.0

Other TSPs Dial-up 350 281

%annual growth -37.4 -19.7

%share of total dial-up 37.5

High-speed 379 % annual growth 16.0 32.9


Subtotal 729 785 % annual growth -17.7 32 .9

% share of total 7.8 8.0

150

2009

286 -33 .9

58.8

3,673 2.5

38.4

3,959 -1.4

39.3

14 -24 .4

2 .8

5,358 7.4

56.0

5,372 7.3

53.4

299 -33 .6

61.6

9,031 5.3

94.3

9,331 3 .4

92.7

187 -33.6

38.4

545 82

5.7

731 82

7.3

2010 2011

210 137 -26.6 -34.9

57.3 55.5

3,762 3,876 2.4 3.0

37.6 372

3,972 4,011 0.3 1.0

38.3 37.6

10 7 -23.0 -28.9

2.8 3 .0

5,642 5,839 5.3 3.5

56.4 56.0

5,653 5,846 5.2 3.4

54.5 ' 54.8

I 220 144 -26.5 -34.6

60.1 58.5

9,404 9,713 4.1 3 .3

94.0 932

9,625 9,857 3.1 2 .4

92 .8 92.4

146 102 -21.7 -30.1

39.9 41.5

604 712 10.8 18.0

6.0 6.8

750 815 2.5 8 .6

G) 7 .6

~ 7.2% of total

CAGR 2007-2011

-29 .9%

3.3%

0.3%

-19.4%

6.3%

6.2%

-29.4%

5.0%

3.6%

-26.5%

17.1%

2.8%

Excerpt from http://www.crtc.gc.ca/eng/publications/reports/PolicyMonitoring/2012/cmr2012.pdf Page 150, table 5.3.2 referenced in Affidavit

BETWEEN:

Court File No.: T-2062·12

FEDERAL COURT



-and-


AFFIDAVIT OF DAVID ZVEKIC Sworn February 7, 2013

Plain tilts

Defendants

I, DaVid Zvekic, live in the City of Torol)to and I hereby MAKE OATH AND SAY that all of the following statements are TRUE, and that I have personal knowledge of the matters herein:

l. I am employed as a software-developer, systems analyst and software designer by Distribute! Communications Limited, a telephone company and Internet Service Provider (ISP), and have been so .employed since November of 2000. Prior to my current employment I was .employed as a compQter programmer and client-server database developer by Cybershift.com, a maker of commercial "time and attendance" software, since early 1999. Prior to that employment I was employed as a computer programmer, database developer, database administrator, and systems analyst by Distribute} Communications Limited since mid.:.1996.

2. I studied at York University, and graduated in 1997 with a Specialized Honours Bachelor of Science specializing in Computer Science. This study included the

th~oretical and applied operation of computer systems, software and hardware, operating systems, computer software and digital logic design and theory, information· processing systems. database and me-systems, mathematics, logic, the scientific method as well as less intensive study in other sciences namely physics, chemistry, psychology and astronomy.

3. I have been writing computer software since 1982, when I designed and wrote my first computer program, at 9-years-old, using the Apple n computer (a program which rendered, in high resolution, mathematical graphical patterns). I have been programming computers regularly ever since. The first commercial software I wrote, when I was 17-years-old, was a program called Scoreboard+PLUS for high school athletic departments to track student athletic achievement.

4. My n01ma1 professional duties at Distribute! include reading and understanding computer software protocols, computer languages, analyzing and improving, as well as debugging, the functioning of computer software sys~ms. designing, writing and modifying computer software systems and software programs as needed for Distributel's business functions as well as troubleshooting software s.ystems that do not perfotni according to expectations, and performing needs assessments to optimize business functions. Those duties also include the responsibility and successful design and writing of billing software, assisting in the design of telephone switching logic, and writing specifications for data exchange protocols between independent software systems in the company and other software prQjects.

5. Furthennore, as part of my professional experience at Distributel, I was required to develop an automated computer software system to process call detail record (CDR) computer logs and call setup detail record (CSDR) computer logs and other data in real time. This was in order to prevent fraudulent telephone usage and to predict future fraudulent activity before it occurs. This· software called "fraudbox" currently runs continuously at Distribute! and is entrusted to automatically reconfigure Distributer s telephone switching system to prevent fraudulent traffic as well as to notify appropriate staff. This software is considered a mission critical system by Distnbutel as any interruption or failure in its operation can result in tens ofthousands·of dollars of losses to toll fraud.

6. Furthermore as part of my professional experience at Distribute! I have previously been required to review a protocol used in the telecommunications industry called Exchange Message Interface (EMI) in order to design and write software to facilitate the exchange of third party account receivables between Distribute! and other telephone carriers. The software Distribute} uses was designed by me to comply with the EMI protocol, and is currently in use on a daily basis. This software must accurately exchange data with external computer systems belonging to third party telephone carriers based upon the EMI specifications and testing procedures set up by me in co-operation with other carriers' technical personnel The EMI specification is over I 000 pages in length.

.0023

7. I am highly qualified to study the operation of software protocols and to determine how they function, how they were intended to function. I am highly qualified to design and write software.to implement those protocols and put them into practice on a computer system. I am also highly qualified to study computer logs to extract infonnation and to determine what can be learned for the purpose of making conclusions on the probable or necessary human or computer activities which are consistent with the data contained in computer logs.

8. As part of my duties I have been asked to review the BitTorrent protocol ("BitTorrent .. or "Protocol") and the functioning of BitTorrent in order to assess its operation and to determine what infonnation BitTorrent will make available to an investigator attempting to ascertain the activities of users of BitTorrent software on the Internet

9. I have downloaded copies of the BitTorrent specification from www.bittorrent.org which is run by the creators of the BitTorrent protocol. I have thoroughly reviewed the specifications as well as used and observed the functioning of freely available BitTorrent client software to determine its mode of operation. I have also consulted numerous other sources of infonnation on BitTorrent. I have also investigated the data contained inside the electronic data files BitTorrent uses to facilitate communication and the transfer of data over the Internet.

BitTorrent

10. BitTorrent is a protocol designed to allow the efficient distribution of electronic fJles over the Internet between multiple computers known as Peers. In this Protocol, any Peer attempting to download a fJ.]e, would do so by acquiring "pieces'' of the file from multiple independent computers (which are all also referred to as "Peers''). Bach Peer interested in a file is expected to help lessen tlie workload of other Peers by making available any piece of the fJ.le it possesses to the other Peers on request and to communicate the availability of pieces it possesses.

11. Since BitTorrent specifies the transfer of information between computers as peers it is commonly referred to as a upeer~to-peer'' or a "P2P" protocol. The transfer of data is also commonly referred to as "file sharing,. because computers transfer the data amongst each other rather than download from a single specific source such as a file server.

12. The Protocol defines that a file being transmitted is subdivided into multiple pieces. Each piece is a small fragment (often 0.1% or less) of the entire flle. It is these pi~s which are uploaded and downloaded amongst Peers. Each Peer must collect all of the pieces before it has succeeding in obtaining a complete file.

13. I have observed a ftle defmed with over 15,000 pieces. With each piece containing only 1/15,000 of the entire file. If this file was a movie, each piece would contain the equivalent of a 0.5 second fragment of a movie with a total runtime of more than 2 hours.

14. In order to be able to download a complete file using BitTorrent there must be at least one other Peer with the complete file. or else some other Peer must have the specific pieces of the file that you are missing. If you are missing multiple pieces, these can be downloaded independently from multiple Peers concurrently, provided each possesses at least one of the missing pieces. If no Peer has any of the pieces you are missing, neither you nor any other Peer will ever succeed in downloading the complete file unless a Peer possessing the missing pieces joins the network.

15. Peers do not offer pieces to each other; they reguest pieces from each other. If a Peer connects to your computer, it is connecting in order to request to download a piece from your computer. The protocol does not allow for Peers to spontaneously upload data to each other without a request.

16. Peers may join or disconnect from the network at any time, and join or disconnect from each other at any time. And consequently it is possible for a Peer to sitidle for extended periods of time waiting for the appearance of another Peer from which it can obtain a missing piece. The presence of a Peer does not establish that it has possession of any piece.

17. The advantage of the Protocol is. that it allows multiple computers to download a file without requiring a central file server and therefore no particular computer acts as a 'bottleneck' or has complete responsibility for distributing the entire file to other Peers.

18. In order for a person to download. a file with BitTorrent that person must first obtain a BitTorrent client software (Client) and another type of file called a 'torrent' or 'meta-info' file ("Torrent"). There are many different BitTorrent Clients but they must all adhere to the Protocol in order to communicate with each other. Torrents are freely available on public web sites. Some Clients are sold commercially or given away in the public domain, distributed on web sites, by other means. Alternatively, a person with the right knowledge can write a Client from scratch as long as they follow the Protocol.

19. As part. of my investigation I wrote my own BitTorrent Client, as well as studied the operation of a third party written Client called "uTorrent." As a qualified software designer and systems analyst I have the necessary skills to write software such as BitTorrent Clients provided I have. access to the protocol specifications and the usualtools of my trade.

0025

20. The Torrent itself contains information describing the flle including its name, size, and other technical data required by the Protocol including a 160 bit message digest also known as a hash ("SHA 1 ") computed on the file; infonnation as to how many pieces and the size of each piece that the file is separated into, a SHA 1 digest computed for each individual piece, and the Internet name of a computer system referred to by the Protocol as a 'tracker' (Tracker), or possibly a list of Trackers. The Torrent does not contain a copy, in whole or in part, of the actual file. There is also some other additional optional information such as. a 'comment' field. A Torrent file often has a filename that ends with the extension u.torrent".

21. The SHA 1 digest is a mathematically computed number that is statistically almost certain to be unique to a particular data file, It is improbable that 2 different data files will ever have the same SHA1 digest, and thus the SHAI is relied on to ensure the accuracy of data transferred using BitTorrent.

22. A BitTorrent Client, when operating on a computer to obtain the file described in a Torrent, communicates over the Internet with a Tracker (as indicated inside the Torrent). The Client transmits the IP address of the computer that it is running on, as well the SHAl digest which uniquely identifies the file it is interested in. A Tracker does not distribute any copies of the file, but is essential for people using the Torrent and Client software to locate other computers distributing the same file in whole or in part. If the Tracker is configured to track that particular flle identified by SHA1 digest, it will accept the connection, otherwise it will reject the connection. Every Client that is being used to attempt to download or upload pieces of the file requires a copy of the same Torrent data and will thus communicate with the same Tracker (or one of the same Trackers listed in the Torrent). The Tracker exchanges the IP addresses of all the computers that the Clients run on with each other, enabling them to transfer data between each other over the Internet. Each computer in this exchange of infonnatio11 is referred to in the Protocol as a Peer.

23. Certain Peers, known as "Seeders", mayhave complete copies of the file. Seeders will upload, piece by piece. to other Peers upon request.

24. Other Peers known as ''Leechers" may have some or no pieces of the file, but may request pieces of the file from Seeders and other I..eechers. Peers may connect to each other without transmitting or possessing any copy of the file.

25. Even though a Leecher does not possess a complete copy of the fJle, it is a normal operation of BitTorrent that Leechers should respond to requests of other Peers to share whatever pieces they do have, even if they have only a single piece of the file. This sharing is infonnally enforced by using a tit-for-tat algorithm that ensures that any Leecher which does not share will suffer degraded download performance as more and more Peers "snub" it, and refuse to honour its requests. A Peer that is snubbed by enough other Peers may never be able to complete the

0026

download. A Peer cannot upload data to another Peer unless the other Peer first asks for it by sending a request message. It can reply to the request by sending a piece message containing a small portion of the data from the file. When a Peer is snubbed, the snubbing Peer sends a "Choke" message to indicate it will refuse to honour any requests from the snubbed Peer.

26. When there are many Leechers and very few Seeders, the Leechers won't all have the same pieces. In order to optimize workload sharing, the Protocol specifies that pieces should be requested in random order. This ensures that Leechers can request missing pieces from each other. This specification lessens the workload on Seeders and allows them to respond to requests for rate pieces. If every leecher started downloading in some non-random, predetermined order, then many Leechers would have the same pieces from the beginning of the order, and no Leechers would have the pieces from the end.

27. Each Peer with any portion of the file is required by the Protocol to transmit a 'bitfield' message to the other Peers indicating exactly which pieces of the file that Peer possesses and which pieces of the f:tle that Peer is lacking. This allows each Peer to know from whom they should request pieces of the flle that they are tnissing, including which Peers are Seeders and which are Leechers. The Protocol specifies that Peers must track this bitfield infonnation and update it during the file transfer. Furthermore when any Peer downloads an additional piece of the flle, they transmit a 'have' message to the other Peers indicating the acquired piece. Thus the Peers keep track of each other's progress in order to maximize sharing of the workload.

28. Using an adequate BitTorrent Client software, I or another qualified person, can use the 'bitfield' and 'have' messages to determine exactly what portion or portions of a file that a particular Peer is in possession of and making available. I have personally observed both the transmission of 'bit:field' messages and 'have' messages, and I can attest that using the Protocol I was able to determine what portions of the me other Peers are in possession of, and cbserve the download progress of other Peers. I was also able to. determine the time when another Peer has downloaded a complete copy of the file.

29. It is the normal operation of BitTorrent that all Peers will appear on the list of Peers even if has not uploaded or downloaded any portion of tbe file. In fact it is possible that no Peers have possession of any portion of the file even if they are connected to the Tracker, attempting to download the ftle. In this case no successful download is possible.

30. In order to ensure that my understanding ofBitTorrent goes well beyond a mere academic level or "expert user" level, and to determine what public information is accurate, I believed it was necessary to observe the actual transfer of data at the lowest and most detailed level and to verify my own understanding of the BitTorrent by creating and implementing my own software BitTorrent Client

0027

"lJ028

according to the Protocol specification document. Therefore I have written my own BitTorrent Client from scratch according to the Protocol specifications. My BitTorrent Client implements the major functions of BitTorrent and I have tested its operation by using it to communicate with third party computers running other BitTorrent Clients and Trackers written by other parties. The only components .of my program which I did not write are the generic components thatare unrelated to BitTorrent itself. For example, I did not write the layer that draws a graphical representation of a button on the screen as this would be time consuming and rendering a click:able button has nothing to do with, and sheds no light on whether or not I understand BitTorrent.

31. By personally observing the interaction of third party BitTorrent Clients and the software I wrote, I was able to determine precisely how the Protocol is actually implemented in the real world, answer questions about its functioning. based on personal and verified knowledge of those details. The knowledge is reliable because when I made a mistake my software would malfunction. Using a Client written by a third party it is not possible to ensure one•s own understanding is correct. By referring to the BitTorrent protocol document I will remember the experience I had implementing .the computer code which causes my software to put that specification into practice. The normal use of BitTorrent Client software doesn't require a person to have any detailed understanding of how it actually works.

32. My investigation into BitTorrent has allowed me to confinn first hand that my understanding of the.protocolis accurate; otherwise my software would not have functioned, It has also allowed me to Clarify my understanding by pel'$onal experimentation where the protocol specification is ambiguous or vague.

33. The BitTorrent protocol conununicates exact details of which portions of the file. a Peer has at a specific time in the ''bitfield" and "have'' messages. That Peer is identified by an IP Address, as this is the identifier used on the Internet to facilitate communication between computers. This can be recorded in a computer log to determine whether or not the Peer had downloaded a substantial portion of a file, prior to seeking any additional information from the Internet Service Provider of the Peer. Indeed this inform~ttion would be obtained, prior to the Client even commencing any download because that is how BitTorrent works.

34. Theinfonnation in Exhibit "A" of the Logan Affidavit does not give any indication of what portion or portions; if any, of the files that each Peer possesses. Consequently it is not possible, based on that information, to determine which if any Peers ever pOssessed a substantial portion of the file, a complete copy, or no copy of the file.

35. In order to communicate and transfer a piece of the file it is essential for Peers to be connected over the same period of time, however the HitDateUTC column in Exhibit ''A", which I interpret to be an indication of the time and date a Peer was

using BitTorrent, appears to differ for the different Peers. This seems to imply that the Peers were not all connected simultaneously, and thus it cannot be concluded from Exhibit "A" whether any of the Peers could have downloaded or uploaded a substantial portion of the file, whether or not some of the Peers did indeed have a substantial or complete portion.

36. In the process of downloading a file over time, a Client may observe any number of other Peers appear on the Tracker. A Client may and communicate with those Peers without knowing if any of those Peers ever possessed a substantial portion of the file unless reference is made to the •bitfield' and 'have' messages those Peers are transmitting.

37. It is a characteristic of BitTorrent that pieces are deliberately small; only a completed piece of a flle has an SHAl digest (described in the Torrent), and thus Peers can maintain a status check on the data they are transmitting or receiving only when a full piece has been completed. Any portion of a file smaller than 1 piece cannot be corroborated for accuracy and is discarded unless the entire piece can be completely downloaded from a same Peer in the same session. If the pieces are large, then it becomes impractical to share the workload between Peers, and thus this is not normal practice.

38. For example, I located, via an Internet search at http://kat.ph, the Torrent that contains information about the file identified as SHAl 232E710F605lDFD450ECF45682920AF737BOB9BFfound in Exhibit "A", with the title of "Recoil.'' I determined by .examining the Torrent details that the complete file is assembled from 704 separate pieces with each piece 1 Megabyte (MlJ) in length, except for the final piece truncated in size (this is nonnal for the final piece). Since the movie Recoil is reported on the Internet at http://www.imdb.com as bc~ing approximately 94 minutes in length, then I estimate a single piece would contain about 8 seconds of movie footage on average. I did not download or attempt to download this movie. This information is contained inside the Torrent

39. If Exhibit "A'' indicates Peers have 1 piece of that file, then I can conclude they have 8 seconds of the movie. However Exhibit "A" does not indicate what portion if any of the file was actually uploaded or downloaded by any specific Peer or if any have any complete piece at all.

40. It is my belief that before Distribute{ Communications Umited is required to turn over any additional information on any computer systems on the basis of BitTorrent evidence, it would be in the best interests of Justice that it is established through the 'bitfield' and 'have' messages, which were communicated by the operation of the BitTorrent protocol in the Client software, what pieces of any file that each computer system downloaded. In that way, it would be possible to establish which computet systems, if any, were in possession of a substantial or

complete portion of a copyrighted work, and which computer systems. if any, were not.

41. I make this affidavit in support of a motion to quash a subpoena and for no other or improper purpose.

SWORN BEFORE ME at the City of Toronto, in the Province of Ontario, this 7th day of February, 2013

) ) )

)

) DAV _d) mil > %_,_i~. aJ,.,.. Q,<·~~~J'I-..p.u-=wr~/l~o-liiiQ"=-=r----- )

A COMMISSIONER FOR OATHS in and for the Province of Ontario

r.....,Kalhrfna Michel, a Qallnfllloner eto., Province of Ontario. ... a:Student-et-Law. 8lpha February 10, 2014.

0031

WRITTEN REPRESENTATIONS- TABLE OF CONTENTS

I. Statement of Facts ............................................................................................................... 1 A. Overview and summary of issues ................................................................................... 1 B. The Parties ...................................................................................................................... 2 C. How the IP address protocol works ................................................................................ 4 D. How Distribute! retrieves customer information ............................................................ 7 E. How BitTorrent works .................................................................................................... 7 F. The adverse market effect on Distribute!.. .................................................................... 11

II. Point in Issue ..................................................................................................................... 12 III. Submissions .................................................................................................................. 13

A. The Moving Parties have failed to meet the required criteria ....................................... 13 B. The Moving Parties have failed to demonstrate a bonafide claim ............................... 14

a) Failure to produce adequate evidence ....................................................................... 15 b) An improper purpose ................................................................................................ 18

C. The Moving Parties have failed to show disclosure outweighs privacy interests ......... 21 D. The Moving Parties have failed to show no other way to obtain the information ........ 23 E. The Moving Parties have failed to include the payment of reasonable compensation in the draft order ........................................................................................................................ 24

IV. Relief Sought ................................................................................................................ 24

- 1 - 0032


FEDERAL COURT

BETWEEN:



Plaintiffs

-and-


Defendants

WRITTEN REPRESENTATIONS OF DISTRIBUTEL COMMUNICATIONS LIMITED (Response to motion for leave to conduct examination for discovery of non-party)

I. STATEMENT OF FACTS

A. Overview and summary of issues

1. Distribute! Communications Limited ("Distribute!") opposes the motion to

compel Distribute! to disclose personal information about some of its customers to NGN Prima

Productions Inc. and Riding Films Inc. (the "Moving Parties"). The Moving Parties allege that

certain Internet Protocol ("IP") addresses assigned to Distribute! customers may have been

involved in unauthorized copying and sharing of three movies through peer-to-peer ("P2P")

Internet networks.

- 2- 0033

2. Distribute} has provided customers with telecommunications services since 1988.

Technological advances, including the Internet, are a significant benefit to society but technology

should not be employed as a tool to obliterate the privacy rights our society also deems so

important. Distribute} stands as the protector of its customers' private information in the face of

the Moving Parties' failure to meet the required legal standard for such disclosure and the

Moving Parties' improper purpose for wanting the information.

3. Distributel's opposition is well founded in law. The Moving Parties have failed to

abide by the established standard that must be met for the Court to order such disclosure. The

Moving Parties have failed to demonstrate that they have a bona fide claim. Furthermore, the

Moving Parties' motion is prejudiced by the improper purpose for which they seek the

information. Finally, an order based on the Moving Parties' motion and evidence would result in

an unjustified violation of the privacy rights of Distribute} customers.

B. The Parties

4. Distribute} is a telecommunications company operating in Canada that offers

services including home phone, long distance, and Internet. Distribute} has offered Internet

services to its customers since 1997.

5.

Distributel's Motion Record, Affidavit of Daniel Puckett, sworn February 7, 2013 ("Puckett

Affidavit") para 3, at TAB 1.

The Moving Parties are two film companies who are the Plaintiffs in a Simplified

Action at the Federal Court in Court file no. T-2062-12. The Defendants are unknown and

referred to as John Doe and Jane Doe. The Statement of Claim was filed on November 14,2012.

- 3 - 0034

An Amended Statement of Claim, adding Riding Films as a Plaintiff, was filed on January 10,

2013.

6. The Moving Parties state they own the copyright to the films Recoil, Crash Site

and Dawn Rider. They allege that their films have been unlawfully copied and distributed over

the Internet by the Defendants. The Moving Parties allege that they have identified the IP

addresses associated with the copyright infringement. They are seeking disclosure of the names

and addresses of persons who are associated with Distribute! IP addresses ..

Moving Parties' Motion Record, Written Representations, paras 2, 4, TAB 3.

Moving Parties' Motion Record, Notice of Motion, para 2 of the grounds, TAB 1.

7. The Moving Parties hired Canipre Inc. ("Canipre"), an Ontario corporation, which

provides forensic investigation services to copyright owners. Barry Logan is the owner and

principle forensic consultant of Canipre. His affidavit is the only evidence tendered by the

Moving Parties in support of this motion.

8.

Moving Parties' Motion Record, Affidavit of Barry Logan, sworn January 10, 2013 ("Logan

Affidavit") paras 1, 4, TAB 2.

On November 19, 2012, NGN Prima Productions Inc. ("NGN"), moved for an

almost identical order from the Court in relation to Recoil (the "November Motion"). That

motion requested customer information from the same respondents, including Distribute!.

Distributel's Motion Record, Puckett Affidavit, paras 37-40, TAB 4.

0035 - 4-

C. How the IP address protocol works

9. The Moving Parties allege that certain IP addresses were used in the transmission

of the works over the Internet.

10. An IP address is an essential component in order for a computer to access the

Internet. It refers to the numerical identifier that an Internet Service Provider ("ISP"), such as

Distribute!, assigns to a computer or computers in order for them to connect over a network

using IP.

Distributel's Motion Record, Puckett Affidavit, para 13, TAB 1.

11. An IP address does not identify a specific individual or even a specific computer.

As such, it is not analogous to a driver's licence, a Social Insurance Number, or a fingerprint. On

the contrary, an IP address can be used as a shared component to access the internet for multiple

users. For example, it may be used to create a wireless network shared by multiple persons in a

household, or in an office local area network, or an Internet coffee shop.


12. As an ISP, Distribute! reserves certain blocks of IP addresses for use by its

residential customers. These include:

(a) Digital Subscriber Line (DSL) Internet customers;

(b) Dial access (DA) Internet customers; and

(c) Cable Internet customers served under Third Party Internet Access (TPIA)

agreements.

- 5 -


13. IP addresses are assigned to customers in such a way that they may receive any

available Distribute! IP address at any time. This means that any particular IP address can be

assigned to multiple customers over a period of time.


14. Where the IP address has been reserved for use by DSL or DA services,

Distribute! may be able to identify the customer account associated with an IP address. This,

however, can only be done if Distribute! is provided with accurate and reliable information

linking a Distribute! IP address to an exact date and time.


15. In some circumstances, Distribute! may be unable to provide the customer

information when the records associated with the identification of the customer have been

purged. As a policy, Distribute! purges records when they are no longer required for business

purposes.


16. In addition, where the IP address has been reserved for use by cable Internet

customers, the IP address assignment is done by the TPIA cable operator. In such a case,

Distribute! has no ability to identify the customer account associated to that IP address. Only the

TPIA operator may have that information.


0036

0037 - 6-

17. Distribute! requires certain information in order to accurately match an IP address

to its customer information including exact date and time.

18. The timing of the recording of the IP address is a crucial matter for accurate

identification of a customer. Computer clocks are known to drift. Distribute! has not considered

the logs it employs to correlate IP addresses to customer accounts to be a critical measure, since

these records are not used for billing purposes.


19. Only if Distribute! knows the exact time differential between the clock on the

computer used at Canipre and the clock used by Distribute! could an accurate correlation be

made. No information as to the clock synchronization state at the time of creation of the logs in

Exhibit "A" of the Logan Affidavit has been provided. Without this information Distribute! is not

able to reliably identify the customer account assigned that IP address at the time of the log's

creation.


20. The Logan Affidavit also provides city information that could assist in matching

the IP address to Distribute! records. However, the geographic location of the subscriber

associated with the IP address matched the geographic location provided in Exhibit "A" to the

Logan Affidavit in only one instance. In all other cases, the geographic location provided in the

Logan Affidavit does not match the geographic location of the subscriber associated with the IP

address on the date and at the time provided.


- 7- 0038

D. How Distribute} retrieves customer information

21. In order to determine the customer information associated with an IP address at

any one time, Distribute! must conduct sequential queries of four servers and an IP address

allocation database.


22. The queries and analysis of the results must be performed by a trained technician.

That technician's results must be re-verified by a separate independent set of queries performed

by another technician. If a result is found, it is then passed to a separate staff member in the

Privacy Office.


23. This Privacy Office member then performs additional queries of Distributel's

customer administration systems. The result will form a hypothesis as to which customer was

associated with the specific IP address at the date and time provided. Once additional checks

have been done, and the information gathered in accordance with policies and practices, the

customer identification can be provided pursuant to an order.


E. How BitTorrent works

24. The Moving Parties allege that works were transmitted via a file-sharing protocol

known as BitTorrent.

25. BitTorrent is a protocol ("Protocol") designed to allow for the efficient

distribution of files over the Internet between multiple computers. Each computer is known as a

0039 - 8 -

Peer. The advantage of using the Protocol is that it allows multiple computers to efficiently

download a file without requiring a central server. This is because the files are transferred in

pieces with each Peer sharing the workload.

26.

Distributel's Motion Record, Affidavit of David Zvekic ("Zvekic Affidavit"), paras 10, 16,

TAB2.

Since BitTorrent specifies the transfer of information between computers as Peers

it is commonly referred to as a "peer-to-peer" protocol. The transfer of data is also commonly

referred to as "file sharing" because computers transfer the data amongst each other rather than

download from a single specific source such as a file server.

Distributel's Motion Record, Zvekic Affidavit, paras 10, 11, TAB 2.

27. The Protocol requires that each file being transmitted be subdivided into multiple

pieces. Each piece is a small fragment, comprising as little as 0.1% of the entire file. Each Peer

must collect all of the pieces before it has succeeded in obtaining a complete file.


28. Multiple pieces can be downloaded independently from multiple Peers

concurrently. If there is a missing piece, no one can succeed in downloading the complete file

unless a Peer possessing that missing piece joins the network.

Distributel's Motion Record, Zvekic Affidavit, para 14, TAB 2.

29. Peers do not offer pieces to each other. They only request them from each other.

The protocol does not allow for Peers to spontaneously upload data to each other without a

request.

- 9 -0040


30. Peers may join or disconnect from the network at any time, and join or disconnect

from each other at any time. The presence of a Peer does not establish that it has possession of

any piece of the file.


31. In order to download a file using the Protocol a BitTorrent client software must be

obtained first ("Client"). Then a torrent file is downloaded that contains meta-info ("Torrent").

Every computer attempting to download or upload a piece of the same file requires a copy of the

same Torrent data.


32. The Torrent does not contain any part of the actual file. Instead, it contains

information about the file including the file name, size, a 160 bit message known as a hash

("SHAl"), how many pieces make up the complete file, the size of the pieces that the file is

separated into, and the Internet name of a Tracker or multiple Trackers.


33. A Tracker does not distribute any copies of a file either but is essential to allow

one computer to locate another computer distributing the same file in whole or in part using the

SHAl information. The Client communicates with the Tracker to exchange the IP address

through which the computer is connected, enabling the transfer of data between the computers.


- 10- 0041 34. Peers with complete copies of the file are known as Seeders. Seeders upload,

piece by piece, copies of a file when requested by a Peer.


35. Each computer with partial or no copies of the file is known as a Leecher. A

Leecher may request a piece of a file from a Peer. Even though a Leecher does not possess a

complete copy of a file, a Leecher should respond to requests of other Peers to share whatever

piece or pieces that they may have.

Distributel's Motion Record, Zvekic Affidavit, paras 24-25, TAB 2.

36. As part of the transfer process, each Peer will transmit a bitfield message to the

other Peers. That message will show exactly how many pieces of the file the Peer has and what

pieces are missing. The Protocol specifies that Peers must track bitfield information and update it

during file transfer. In addition, when a Peer downloads an additional piece of a file, it transmits

out a "have" message to the other Peers. This allows all Peers to track the progress of the

download in order to maximize efficiency.


37. Since each transfer includes a bitfield message, each transfer includes information

that shows exactly how much of a file was provided by a particular Peer and how much of the

file that particular Peer has. This information can be obtained prior to the Client commencing a

download.

Distributel's Motion Record, Zvekic Affidavit, paras 28, 33 TAB 2.

0042 - 11-

38. Exhibit "A" of the Logan Affidavit does not indicate the amount of each file that a

specific Peer using the recorded IP address possessed. As noted above, that information is

contained in a bitfield message and would have been exchanged as part of the normal operation

of the Protocol.


39. In addition, in order to communicate and transfer a piece of a file, it is essential

that Peers be connected over the same period of time. While downloading a file, a Client may

observe any number of other Peers that appear on the Tracker. The Client may communicate

with those Peers, without knowing if any of them ever possessed a substantial portion of the file,

unless reference is made to the bitfield and "have" messages those Peers are transmitting.


40. The information about how many pieces are required to make a full copy of a

particular file using the Protocol is readily available online if the file identifier is known. From

this information and the size of the three films at issue, it can be shown that a piece of a film

transferred using the Protocol may consist of as little as 8 seconds of the feature-length films.


F. The adverse market effect on Distribute}

41. The ISP sector is dominated by a few large incumbent telephone and cable

companies. Independent ISPs as whole, including Distribute!, Access Communications Co

operative Limited and ACN Inc., together garner only 6.7% of the residential Internet revenues

- 12- 0043

from 7.6% of the total Canadian Internet subscribers. Independent ISPs therefore face significant

competition from very powerful competitors.


42. The Moving Parties only seek the identities of customers of three independent

ISPs. Furthermore, in Distributel's response to the November order granted as a result of the

previous motion brought by NGN, 17 IP addresses were identified as requiring further

investigation from the cable companies. No steps were taken to obtain an order for disclosure

from the cable companies in this court file. The current motion is a request for additional

independent ISP customer identities only.


43. Distribute! is concerned with the Moving Parties' apparent selectivity. Motions

for disclosure of confidential customer information have been well publicized, and will likely

continue to be so. Canadians value their privacy. Should the independent ISPs appear to be

disproportionate targets for disclosure motions, it could negatively impact the ability of

independent ISPs to compete in an already tough market. This is of significant concern to

Distribute!.


II. POINT IN ISSUE

44. The sole point in issue is whether or not this Court should exercise its discretion

to grant the motion for leave to conduct examination for discovery in writing of a non-party

pursuant to Rule 238.

- 13- 0044

45. Distribute! submits that the Moving Parties have failed to meet the established

legal requirements and therefore the Court must deny the motion.

Ill. SUBMISSIONS

A. The Moving Parties have failed to meet the required criteria

46. In BMG Canada Inc. v. John Doe, 2005 FCA 193 ("BMG"), the Federal Court of

Appeal established the test that a Court should apply to determine if an ISP should be ordered to

disclose the identity of its subscribers. The BMG case involved a motion for leave to examine a

non-party to uncover the identities of customers attached to various IP addresses that were

alleged to have been used to engage in the file sharing of recorded music. The case is important

because it set out the requirements for when such an order can be sought and the evidentiary

standard required in order for the Court to grant the motion.

47. The Court in BMG made two major determinations. First, the Court conclusively

approved the use of a motion under Rule 238 as broad enough to permit discovery of an ISP in a

copyright infringement case. Second, the Court held that the principles applicable to an equitable

bill of discovery are equally applicable to a motion under Rule 238.

48.

(a)

(b)

Moving Parties' Motion Record, BMG, paras 25, 30-31, TAB 5.

The following are the criteria required. The Moving Parties must show:

That the evidence demonstrates a bona fide claim against the defendants;

That the public interest in the disclosure of the information is outweighed by the

legitimate privacy concerns of the affected persons;

49.

- 14- 0045 (c) That the information in possessiOn of the ISP companies must be relevant

information on an issue in the action and the non-party more than a mere

bystander;

(d) That the information cannot be otherwise obtained in an informal manner or from

another source;

(e) That the action cannot be furthered until the requested information is obtained;

(f) That only the required information will be extracted; and

(g) That the order will not cause undue inconvenience or expense and that there will

be reasonable compensation provided to the ISP company.

Moving Parties' Motion Record, BMG, paras 32, 34-37, 44, TAB 5.

In order to succeed, the Moving Parties must demonstrate that they meet each of

the above criteria. They have failed to do so. Most notably, they have not demonstrated that they

have a bona fide claim and they have failed to show that the interest in disclosure outweighs the

privacy interests of the affected person. As such the motion should be dismissed.

B. The Moving Parties have failed to demonstrate a bona fide claim

50. The Moving Parties' are required to adduce evidence to show they meet the

threshold of a bona fide claim against the proposed defendant. A bona fide claim must comply

with the following:

(a) there must be adequate evidence to support the Moving Parties' allegations;

51.

- 15-0046

(b) the Moving Parties must not have an improper purpose for seeking the

information requested; and

(c) the Moving Parties must intend to bring an action.

Moving Parties' Motion Record, BMG, para 34, TAB 5

The Moving Parties must comply with all three elements of the test above. In this

case, they have failed to provide adequate evidence and have brought their motion on the basis of

what appears to be an improper purpose.

a) Failure to produce adequate evidence

52. The evaluation of the Moving Parties' evidence is not one of likely success at

trial, but the requirement of demonstrating a bona fide claim does allow the Court to weigh the

strength of the Moving Parties' evidence.

53. The affidavit evidence submitted by the Moving Parties contains numerous errors,

inconsistencies and missing links. These factual problems throw the reliability of all the evidence

into question.

54. Mr. Logan has sworn that he used "a proprietary technology platform that

provides effective means to detect unauthorized distribution of movies." This proprietary

technology platform is not identified. Nor is there a description of how it works or how prone it

is to error.

Moving Parties' Motion Record, Logan Affidavit, para 3, TAB 2.

0047 - 16-

55. Exhibit "A" of the Logan Affidavit contains a column marked "city". Mr. Logan

states that his software can track an IP address to a particular geographic region. Again, the

process by which this is done is not shown or explained.

Moving Parties' Motion Record, Logan Affidavit, para 23, Exhibit A, TAB 2.

56. Distribute! examined the IP addresses listed and determined that the listed

geographic locations in the Logan Affidavit were erroneous in all but one entry if the date and IP

address were assumed to be correct. In other words, when Distribute! matched the IP address at

the time noted in column "HitDateUTC", it came up with an almost entirely different set of data

for the "city" column.


57. This indicates any or all of the following possibilities:

(a) The city information is incorrect;

(b) The IP address information is incorrect;

(c) The time information is incorrect; and/or

(d) The date information is incorrect.

58. Evidence of the proper functioning of the platform is necessary for the Court to

evaluate the claim. Distribute! has determined that the Moving Parties' evidence of geographic

locations is almost entirely erroneous. This calls into question the validity of all the evidence

provided by the Moving Parties.

- 17- 0048 59. The Moving Parties' evidence also includes several inconsistences. For example,

the Notice of Motion and the Logan Affidavit allege that each Peer copied and distributed all

three of the films.

Moving Parties' Motion Record, Notice of Motion, para 1 of the grounds, TAB 1.

Moving Parties' Motion Record, Written Representations, para 12, TAB 3.

Moving Parties' Motion Record, Logan Affidavit, paras 14, 24, 27, TAB 2.

60. In comparison, other aspects of the Moving Parties' motion record indicate that

each Peer may be accused of unauthorized copying of just one of the films.

Moving Parties' Motion Record, Logan Affidavit, paras 15-16,30, TAB 2.

61. The most troubling aspect of the evidence submitted, however, is not the

weakness of what was provided, but the significant evidence that was not provided.

62.

(a)

The Moving Parties' omitted to introduce the following crucial evidence:

They have not indicated how much of the work is in the possession of each Peer

for which an Distribute! IP address was recorded;

(b) They have not shown that a substantial portion of a film was infringed by any one

of the Peers for which a Distribute! IP address was recorded;

(c) They have not shown how many pieces made up the Protocol for each film and

how many of those pieces each Peer possessed;

63.

0049 - 18 -

(d) They have not described the process by which the proprietary software identifies

the IP address that was allegedly involved in the unauthorized sharing;

(e) They have not identified, in contrast to the November Motion, the P2P networks

through which the file transfers were occurring;

(f) They have not identified for the Court the Peer's pseudonym or network name

even though that information was collected; and

(g) They have not identified the video files' metadata including the size of the files

that were transferred, even though they must have this information based on how

the Protocol works.

Therefore, on the totality of the evidence adduced and lack thereof, the Moving

Parties have failed to demonstrate a bonafide claim.

b) An improper purpose

64. The Moving Parties have also pursued this motion for what appears to be an

improper purpose and cannot therefore succeed.

65. The Moving Parties appear to be engaged in a practice to profit by engaging in

zealous copyright enforcement, a practice referred to as "copyright trolling". It involves sending

letters to customers demanding significant financial compensation for the alleged copyright

infringement. The amount of money demanded far exceeds any potential damages to the Plaintiff

arising from the alleged breach. The customers are threatened with legal action if they do not

comply. Following the November Motion, at least one Distribute! customer received such a

letter.

- 19- 0050

Distributel's Motion Record, Puckett Affidavit, Exhibit A, TABlA.

66. In the November Motion, the Plaintiff NGN stated in its written representations

that once addresses and names were provided the company would "send them cease and desist

letters and, if required, to add them as named Defendants to this action." This exact same

sentence is repeated in the Moving Parties' current representations before this Court. The

correspondence a customer shared with Distribute! showed that the customer did not merely

receive a cease and desist letter. Instead the customer was faced with a demand for settlement

that misrepresented and exaggerated the amounts in statutory damages that NGN was entitled to

recover under existing copyright law.

Moving Parties' Motion Record, Written Representations, para 4, TAB 3.

Distributel's Motion Record, Puckett Affidavit, Exhibit A, TABlA.

67. On November 7, 2012, a majority of the provisiOns of the Copyright

Modernization Act came into force, including amendments to the provisions establishing

statutory damages for non-commercial infringement. During parliamentary debate surrounding

the legislation, the previous statutory damage regime for non-commercial infringements was

criticized as being completely disproportionate. Consequently, a significant reduction in the

statutory damages for non-commercial copyright infringements was a key amendment made in

order to deter a class of plaintiffs :from litigating claims like the one presently before this Court.

Distributel's Motion Record, Excerpt from the House of Commons Debates, Hansard,

October 18, 2011, TAB 4.

Distributel's Motion Record, Industry Canada Fact Sheet on Copyright Remedies, TAB 5.

- 20-

0051 68. However, in the letter sent to the Distribute! customer, dated November 27, 2012,

NGN made the following statement:

69.

Should you not agree to these terms, NGN Prima Productions Inc reserves its right to seek a higher amount by adding you as a defendant in Court FileT -2062-12. The Copvright Act allows the court to assess statutory damages anywhere between $1000 and $20,000. We are aware of two cases where the court awarded $5000 per film for compensation for copyright infringement, and of one case where the court awarded $1000 for each of 14 films that were copied and distributed without authorization. In each case, the court also ordered that additional amounts be paid to cover costs and interest.

In addition, a bill before the Canadian Parliament would allow copyright owners to recover up to $5000 for non-commercial infringements. (emphasis added)

Distributel's Motion Record, Puckett Affidavit, Exhibit A, TAB 1A.

The implication in the letter is that the Distribute! customer could be facing

statutory damages of up to $20,000 and an additional $5,000 from the new provision for a total

of $25,000. This is a misrepresentation of the law.

70. The amendments referred to had in fact already been passed by Parliament and

was in force 20 days prior to the date of the letter. Furthermore the effect of the amendments was

to reduce the maximum statutory damages for non-commercial infringement to a maximum of

$5,000. Ass. 38.1(b) states:

71.

38.1 (1) Subject to this section, a copyright owner may elect, at any time before fmaljudgment is rendered, to recover, instead of damages and profits referred to in subsection 35(1), an award of statutory damages for which any one infringer is liable individually, or for which any two or more infringers are liable jointly and severally,

(b) in a sum of not less than $100 and not more than $5,000 that the court considers just, with respect to all infringements involved in the proceedings for all works or other subject-matter, if the infringements are for non-commercial purposes. (emphasis added)

Distributel's Motion Record, Copyright Act (RSC 1985, c. C-42), s. 38.1, TAB 6.

In addition to copyright trolling, the Moving Parties are affecting the market for

ISP services by unfairly targeting small independent ISP companies such as Distribute!. These

ISP companies represent only 7% of the ISP market in Canada. Yet the Moving Parties have not

- 21 - 0052 sought a similar motion for discovery for customers of the larger ISP companies representing the

other 93% of the population.


72. The Moving Parties' choice to pursue independent ISP companies is unfair and

adversely affects the highly-competitive market for residential Internet access services. If the

public perceives their privacy rights to be diminished due to their purchase of services through a

smaller company, then those customers may opt for larger companies. The perception that the

subscriber may be more of a target and therefore more likely to have their privacy infringed may

be enough to negatively affect consumer choice.


C. The Moving Parties have failed to show disclosure outweighs privacy interests

73. One of the most important criterion established by BMG requires the Court to

determine whether the public interest of disclosure outweighs the legitimate privacy concerns of

the person who would be identified should the order be granted.

Moving Parties' Motion Record, BMG, para 36, TAB 5.

74. The Moving Parties' motion presents a threat to the privacy rights of Distributel

subscribers. As the Court stated in BMG:

Modern technology such as the Internet has provided extraordinary benefits for society, which includes faster and more efficient means of communication to wider audiences. This technology must not be allowed to obliterate those personal propertv rights which society has deemed important. Although privacy concerns must also be considered, it seems to me that they must yield to public concerns for the protection of intellectual property rights in situations where infringement threatens to erode those rights. (emphasis added)


-22- 0053 75. Until sufficient evidence is submitted that adheres to the standard required by the

Court, Distribute! remains the protector of its subscribers' privacy rights. That protection can

only be waived when sound evidence is provided to justify the loss of those rights.

76. Even if a bona fide claim is presented, the Court must exercise caution in ordering

disclosure so that privacy rights are invaded only in the most minimal way.


77. Companies are not at liberty to voluntarily disclose personal information such as

identities, unless they have the customers consent, or are required to disclose pursuant to a court

order.


78. Subscribers have an expectation that their identity will be kept private. That

expectation is legally supported by section 3 of the Personal Information Protection and

Electronic Documents Act ("PIPED A"):

79.

3. The purpose of this Part is to establish, in an era in which technology increasingly facilitates the circulation and exchange of information, rules to govern the collection, use and disclosure of personal information in a manner that recognizes the right of privacy of individuals with respect to their personal information and the need of organizations to collect, use or disclose personal information for purposes that a reasonable person would consider appropriate in the circumstances.

ISP companies such as Distribute! are also bound by PIPEDA to retain the private

information of their subscribers for as long as is necessary to allow an affected subscriber to

exhaust available recourses under PIPED A.


Distributel's Motion Record, PIPEDA s. 7(3)(c), 8(8) and s. 28, TAB 7.

-23- 0054

80. The standard of evidence required to support a bona fide claim is not just a

response to the high value our society places on the protection of privacy, but is also aimed at

protecting the innocent.

81. In BMG, the Court of Appeal stated that the greatest care should be taken to avoid

delay between the investigation and the request for information. This was a factor that might

justify a court in refusing to make a disclosure order, for the very reason that it could affect the

rights of the innocent:

82.

"If there is a lengthy delay between the time the request for the identities is made by the plaintiffs and the time the plaintiffs collect their information, there is a risk that the information as to identity may be inaccurate. Apparently this is because an IP address may not be associated with the same individual for long periods of time. Therefore it is possible that the privacy rights of innocent persons would be infringed and legal proceedings against such persons would be without justification. Thus the greatest care should be taken to avoid delay between the investigation and the request for information. Failure to take such care might well justify a court in refusing to make a disclosure order." (emphasis added)


In the case at hand, Exhibit "A" of the Logan Affidavit shows that the retrieval

dates ranged from October 20, 2012 to December 5, 2012. The motion was brought on January

10, 2013. The moving parties provided no explanation for the lengthy delay.

Moving Parties' Motion Record, Logan Affidavit, Exhibit A, TAB 2.

83. For all the above reasons, the Moving Parties have failed to show that the public

interest of disclosure outweighs the legitimate privacy concerns of the person who would be

identified should the order be granted.

84.

D. The Moving Parties have failed to show no other way to obtain the information

Clear evidence must be adduced to show that the information requested by the

Moving Parties cannot be obtained from another source.

-24- 0055 Moving Parties' Motion Record, BMG, para 35, TAB 5.

85. No such evidence or statements were made by the Moving Parties to prove that

the identities sought could be not be established through other means. In order to satisfy this

criterion, the Court should require evidence from the Moving Parties that that the ISPs, including

Distribute!, are the only practical source of the information required by the Moving Parties.

86.

E. The Moving Parties have failed to include the payment of reasonable compensation in the draft order

In Voltage Pictures LLC v. Jane Doe and John Doe, 2011 FC 1024 ("Voltage), an

uncontested Rule 238 motion judgement relied on by the Moving Parties', the Plaintiff proposed,

and the Court ordered, that the Plaintiff reimburse any reasonable expense incurred by the ISP

companies in collecting the information requested.

Moving Parties' Motion Record, Voltage, para 26, and judgment, TAB 4.

87. In this case, the Moving Parties have not provided for reasonable compensation in

the draft order. The Court is required to order compensation for reasonable expenses incurred by

the non-party.

Distributel's Motion Record, Rule 238(3)(d), TAB 8.

IV. RELIEF SOUGHT

88. For all of the foregoing reasons, Distribute! respectfully requests that the motion

for leave to conduct an examination for discovery of Distribute! be denied.

-25- 0056

89. In the alternative, should the Court order disclosure, Distribute! requests that the

order reqmre the Moving Parties to provide reasonable compensation for the information

extraction.

90. As a non-party and regardless of the outcome of the motion, Distribute! requests

costs of this motion on a substantial basis.

ALL OF WHICH IS RESPECTFULLY SUBMITTED THIS 8th DAY OF FEBRUARY,

2013

Fas en Martineau DuMoulin LLP 55 Metcalfe Street, Suite 1300 Ottawa, ON KIP 6L5 Tel: (613) 236-3882 Fax: (613) 230-6423

Gerald (Jay) Kerr-Wilson Email: [email protected] Marisa Victor Email: [email protected]

Counsel for Distribute! Communications Limited

HOUSE OF COMMONS (HAMBRE DES COMMUNES

CANADA

J)ou~e of (ommon~ llebate~ VOLUME 146 • NUMBER 031 • 1st SESSION

OFFICIAL REPORT (HANSARD)

•

Tuesday, October 18, 2011

Speaker: The Honourable Andrew Scheer

41st PARLIAMENT

0057

0058 October 18, 2011 COMMONS DEBATES 2107

Hon. Gordon O'Connor: Mr. Speaker, I will keep my comments brief.

As I said before, we are elected in the House of Commons to enact legislation. We have a right to introduce legislation, to debate it here and, if successful, to pass it. We can amend any law we want going back to 1867. We are not talking about privilege when introducing this bill. If this bill is not allowed to come in and we cannot amend previous laws then my privileges will be violated.

The Speaker: I thank hon. members for their interventions. I will take the case under advisement and come back to the House with a decision in due course.

GOVERNMENT ORDERS

[Translation]

COPYRIGHT MODERNIZATION ACT

Hon. Christian Paradis (Minister of Industry and Minister of State (Agriculture), CPC) moved that Bill C-11, An Act to amend the Copyright Act, be read the second time and refeiTed to a committee.

He said: Mr. Speaker, I am pleased to speak this morning at second reading of Bill C-11, the Copyright Modernization Act.

[English]

With the permission of the House, I will be splitting my time with the Minister of Canadian Heritage and Official Languages.

The Speaker: Does the hon. minister have the unanimous consent of the House to share his time with the Minister of Canadian Heritage and Official Languages?

Some hon. members: Agreed.

[Translation]

Hon. Christian Paradis: Mr. Speaker, as you know, this is the second time that the govemment has introduced this bill. During the previous Parliament and for almost a year, the Copyright Modernization Act-then known as Bill C-32-was carefully examined and debated by parliamentarians and stakeholders.

We know how much time and effort members of Parliament, stakeholders and Canadians spent on this bill. The legislative committee created to examine the bill heard from more than 70 witnesses and received more than 150 submissions. All stakeholders were consulted, and the government received letters from across the country.

[English]

We fully expect that when the bill is once again refeiTed to a House of Commons committee the work and testimony from the previous Parlian1ent will be carefully considered and taken into account.

Over the course of the committee hearings on this bill in the last Parliament, there were two clear messages that emerged. The first message was that this bill balances the interests of the various stakeholders. The bill, a product of wide-ranging consultation and discussion, sets out a balanced approach to corporate refonn in the

Government Orders

digital age. While the government strongly believes that this bill delivers the best balance between the interests of consumers and the rights of the creative community, we are open to technical amendments that may improve the clarity and intent of certain provisions.

Second, we heard that Canada urgently needs to pass legislation to update the Copyright Act. By reintroducing this same bill, parliamentarians will be able to build on this previous work in order to enable the swift passage of these important legislative updates. Each year that Canada goes without modem copyright laws, the need for such modernization becomes more evident as technology evolves and new issues emerge.

The last time the act was changed, there were no MP3 players. Video stores were still full of VHS tapes. No one thought we would be able to take pictures with a cellphone and upload them onto computer screens around the world, or use a cellphone to download songs and movies.

The world has changed so much since then that the Copyright Act seems like a law for a different era. The time has come to modemize Canada's copyright laws and bring them in line with the demands and technologies of the digital age.

• (1035)

[Translation]

This bill must be passed in order to modernize Canada's copyright regime in accordance with the government's digital economy strategy.

Digital technology opens new markets and expands the reach of companies. It brings together people and ideas in a way that was still unimaginable only a few years ago. When individuals, companies and national economies create and adopt these new technologies, a number of important things are achieved. Productivity and innovation increase, and new products, processes and business models see the light of day.

The growth of the digital economy in Canada depends on a clear, predictable and fair copyright regime that supports creativity and innovation while protecting copyright holders.

The global economy remains fragile. This bill will help to protect existing jobs and create new ones. It will spark innovation and attract new investments in Canada. It will give creators and copyright holders the tools they need to protect their work and increase their business. The bill establishes clearer rules that will allow all Canadians to fully participate in the digital economy, both now and in the future.

One of the bill's main objectives is to balance the interests of all stakeholders in the copyright regime. Achieving this balance has become increasingly complex given the exponential growth of the Internet. Canadians can obtain protected works online, sometimes through revenue-generating platforms or services, but also through free services, both legitimate and illegitimate. Our capacity to use high-quality Web services to obtain, protect and create copyrighted works is essential to our economic success and our cultural presence in the world.

0059

2108 COMMONS DEBATES October 18, 2011

Government Orders

That is why, in 2009, our govemment tumed to Canadians to get their ideas and advice on copyright reform in the digital age. Thousands of individual Canadians, companies and stakeholder organizations shared their opinions on the best way to adapt Canada's copyright regime to this new age. These consultations showed that Canadians were becoming increasingly aware of the importance of copyright in their daily lives and in our digital economy.

On the one hand, this bill seeks to reflect today's reality where the private, non-commercial use of copyrighted material is commonplace. The bill would authorize many of these uses and establish parameters for cases which, to date, were not well defined.

For example, Canadians could copy works legally obtained on their computers and mobile devices to enjoy them wherever they may be. They could store content in and retrieve it from the infonnation cloud or use a network PVR service.

It will also be legal to integrate protected works into a work generated by a user for non-COl11111ercial purposes. That would include recording a home video of a child dancing to a song, or creating original mixes of songs and videos. This exception requires that the rights and interests of copyright holders be respected. There are many examples where copyright holders have benefited from exposure on the Intemet owing to work done by users.

Finally, the bill updates the Copyright Act to reflect new technologies and uses by broadening the exceptions and creating new ones for educational and training institutions, technical procedures, the development of software, broadcasters and the disabled.

I would like to point out that great care was taken when drafting these provisions to reflect the needs and interests of copyright holders. The provisions do place limits and restrictions on the use of protected works.

For example, many of these exceptions do not apply to works protected by a technological protection measure or digital lock. Copyright holders told us that their digital and on-line business models depend on the robust protection provided by digital locks. Therefore, the bill strikes a good balance. It allows Canadians to make reasonable use of content while providing creators and businesses, whose work depends on this content, with the tools and certainty they need to launch new products and services.

• (1040)

[English]

While our govemment knows that the overwhelming majority of Canadians are law-abiding, we are concerned about the threat of major penalties that hang over Canadians who infringe copyright for non-commercial purposes. Currently, those who have been found to violate copyright can be found liable for damages from $500 to $20,000 per work.

If people illegally download five songs, for example, they could theoretically be liable for $100,000. In our view, such penalties are way out ofline. As such, the bill proposes to reduce the penalties for non-commercial infringement. Under its provisions, the courts

would have the flexibility to award total damages of between $1 00 I and $5,000.

[Translation]

However, while the bill reduces penalties for non-commercial infringements, it still seriously punishes those who profit from copyright infringement. Penalties of $500 to $20,000 per infringement will still apply to piracy for commercial purposes. In addition, the bill proposes new tools to target those who find techniques to infringe online copyright and it sets out serious penalties for those who make money by creating and distributing devices and services designed to hack digital locks. It will be very difficult to benefit from piracy.

[English]

Mr. Charlie Angus (Timmins-James Bay, NDP): Madam Speaker, I listened with great interest to my bon. colleague and I heard the word "balanced" being used time and time again, and yet the bill is very unbalanced.

We are not here talking about copyright, the right of creators and who has their copies. This bill is about corporate right, the right of a corporate entity to decide what right citizens have. It is a sleight of hand. It is very important for people to recognize that the bill is offering citizens' rights that they will not be able to exercise if a corporate entity puts a digital lock on the product.

Looking at how our WIPO compliant countries around the world have dealt with the issue of digital locks, and under sections 10 and II of the WIPO copyright treaty, it talks about the right to have exemptions of the digital lock as long as it is not being broken or infringed for commercial purposes, but in order to give citizens the right to access works to which under a legislative regime they have a right to access. However, under the bill, any rights that the citizen is granted in the bill are arbitrarily taken away with the digital lock provisions.

Will the govermnent work with the New Democratic Party to fix the digital lock provisions to ensure they do not unfairly target students and consumers who are legally entitled to access works? If we fix the digital lock provisions, would the Conservatives be willing to work with us to ensure we are WIPO compliant but also responding to the needs that citizens have on this issue?

• (1045)

[Translation]

Hon. Christian Paradis: Madam Speaker would like to thank the hon. member for his question.

I was coming to the aspect of innovation. As the member so rightly said, we need to talk about balance here because that is what is reflected in this bill.

ARCHIVED -Fact Sheet on copyright Remedies - Intellectual Property Policy Director... Page 1 of 3

1+1 Industry lndustrie Canada Canada

Intellectual Property Policy

Industry Canada

ARCHIVED - Fact Sheet on copyright Remedies

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Background

An Act to Amend the Copyright Act (Bill C-32), adopted in April 1997, introduced new remedies for creators of all kinds of works. These remedies, which came into force on October 1, 1999, are designed to provide stronger deterrents against copyright infringement and to better compensate copyright owners for losses suffered because of infringement.

Because the extent of infringement is particularly difficult to prove, copyright owners were often inadequately compensated for losses suffered as a result of infringement of their rights. Bill C-32 introduced that guarantee a minimum award once infringement is proven, and which should serve to deter future infringements.

In order to more effectively halt infringements, the amendments also include a "wide injunction" which covers a broader range of copyright protected materials than the injunctions previously available in such cases.

Further, in some circumstances, copyright owners will now be able to avail themselves of summary procedures which are more expedient and less expensive than full court actions.

Interested parties

The remedies are available to all types of copyright owners including authors, composers lyricists, performers, producers ofsound recordings and audiovisual works, as well as software and multimedia businesses.

1) Statutory Damages

What are statutory damages?

In respect of the infringement of copyright, a copyright owner may choose to receive "statutory damages." Statutory damages allow the copyright owner to receive an amount between $500 and $20,000 in respect of each work or subject matter infringed by the defendant.

Why did the Bill introduce a statutory damages regime in the Copyright Act?

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c A copyright owner who commences proceedings tor infringement must prove not only the Q Q J 1 infringement, but also the losses suffered as a result. However, it is often difficult, sometimes impossible, to prove such losses because evidence as to the extent of infringement is usually

- difficult and/or expensive to find. Statutory damages alleviate this difficulty by guaranteeing a minimum award of damages once infringement is established.They also ease the evidentiary burden on the plaintiff in proceedings for infringement, deter future infringements, reduce the cost of litigation and encourage the parties to settle matters out of court.

How is the amount of statutory damages determined?

I - General Rule

In respect of each work or subject matter infringed, the court may award a sum between $500 and $20,000. The precise sum awarded is entirely within the court's discretion. However, the court must have regard to the following circumstances: the good or bad faith of the defendant; the parties' conduct before and during the court proceedings; and the need to prevent other infringements of the copyright in question.

II - Particular Cases

Innocent Infringer

Where a court is satisfied that a defendant infringed copyright innocently, it may lower the minimum amount of statutory damages to $200 per work or other subject matter infringed. A defendant is considered to be innocent if the defendant was not aware and had no reasonable grounds to believe that copyright was infringed.

Multiplicity of works on the same format

When a medium contains more than one copyrighted work or subject matter and if the application of the general rule (subsections 38.1(1) and (2) of the Bill) results in an award of statutory damages that is disproportionate to the seriousness of the infringement, the court may award less than the minimum amount specified in those provisions.

For example: In the context of digitization, media such as CD-ROMs contain increasingly large numbers of works or subject-matter in which copyright subsists. However, the application of the general rule ($500 to $20,000 per work infringed) may result in awards of statutory damages that are clearly disproportionate to the copyright owner's losses. In such instances, the court may depart from the general rule and reduce the amount at its discretion.

Collective societies

Collective societies that license the use of works or other subject-matter in which copyright subsists may recover, as statutory damages, the value of the royalties (or price of the licence) multiplied by a factor between three and 10, as the court considers just. This provision maintains proportionality between the value of a royalties (i.e. the loss incurred by the copyright owners) and the damages awarded. The use of a multiplying factor is intended to encourage users to obtain the appropriate licences beforehand.

For instance: A licence to play taped music at a wedding might cost $60. The damages to be paid under subsection 38.1(4) would therefore range between $180 (3 x $60) and $600 (10 x $60). The judge would determine the appropriate award within these two values based on the following factors: the good or bad faith of the defendant; the parties' conduct before and during the court proceedings; and the need to prevent other infringements of the copyright in question.

Are there any cases where statutory damages cannot be awarded?

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Statutory damages may not be awarded against educational institutions. In addition, statutory Q J 6 2 damages are not available in respect of infringements arising from the parallel importation of works or other subject matter or from dealings with such imported works or other subject matter.

Are there any other countries with statutory damages regimes?

The United States, Israel, Russia and Germany (for certain uses) have statutory damages regimes in their copyright legislation.

2) Wide Injunction

In respect of copyright infringement, an injunction is an order made by a court ordering someone to refrain from carrying on the activities which constitute the infringement. The "wide injunction" introduced in Bill C-32 allows a court to grant an injunction, not only in respect of a specific work, but also in respect of works later acquired by the plaintiff, even though he or she was not, at the time the proceedings were commenced, the owner of the copyright or the person to whom an interest in the copyright has been granted; and similarly, in respect of works that did not exist at the time the proceedings were commenced. In other words, the wide injunction should prevent infringement of copyright in any of the works in which the plaintiff currently has or will obtain a copyright interest.

Date Modified: 2011-10-26

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0063 Copyright Act (R.S.C., 1985, c. C-42)

38.1 (1) Subject to this section, a copyright owner may elect, at any time before final judgment is rendered, to recover, instead of damages and profits referred to in subsection 35(1), an award of statutory damages for which any one infringer is liable individually, or for which any two or more infringers are liable jointly and severally,

(a) in a sum of not less than $500 and not more than $20,000 that the court considers just, with respect to all infringements involved in the proceedings for each work or other subjectmatter, if the infringements are for commercial purposes; and

(b) in a sum of not less than $100 and not more than $5,000 that the court considers just, with respect to all infringements involved in the proceedings for all works or other subjectmatter, if the infringements are for non-commercial purposes.

(1.1) An infringement under subsection 27(2.3) may give rise to an award of statutory damages with respect to a work or other subject-matter only if the copyright in that work or other subject-matter was actually infringed as a result of the use of a service referred to in that subsection.

(1.11) For the purpose of subsection (1), an infringement under subsection 27(2.3) is deemed to be for a commercial purpose.

(1.12) If the copyright owner has made an election under subsection (1) with respect to a defendant's infringements that are for non-commercial purposes, they are barred from recovering statutory damages under this section from that defendant with respect to any other of the defendant's infringements that were done for non-commercial purposes before the institution of the proceedings in which the election was made.

(1.2) If a copyright owner has made an election under subsection (1) with respect to a defendant's infringements that are for non-commercial purposes, every other copyright owner is barred from electing to recover statutory damages under this section in respect of that defendant for any of the defendant's infringements that were done for non-commercial purposes before the institution of the proceedings in which the election was made.

(2) If a copyright owner has made an election under subsection (1) and the defendant satisfies the court that the defendant was not aware and had no reasonable grounds to believe that the defendant had infringed copyright, the court may reduce the amount of the award under paragraph (1)(a) to less than $500, but not less than $200.

(3) In awarding statutory damages under paragraph (1)(a) or subsection (2), the court may award, with respect to each work or other subject-matter, a lower amount than $500 or $200, as the case may be, that the court considers just, if

(a) either

• (i) there is more than one work or other subject-matter in a single medium, or

• (ii) the award relates only to one or more infringements under subsection 27(2.3); and

(b) the awarding of even the minimum amount referred to in that paragraph or that subsection would result in a total award that, in the court's opinion, is grossly out of proportion to the infringement.

(4) Where the defendant has not paid applicable royalties, a collective society referred to in section 67 may only make an election under this section to recover, in lieu of any other remedy of a monetary nature provided by this Act, an award of statutory damages in a sum of not less than three and not more than ten times the amount of the applicable royalties, as the court considers just.

(5) In exercising its discretion under subsections (1) to (4), the court shall consider all relevant factors, including

(a) the good faith or bad faith of the defendant;

(b) the conduct of the parties before and during the proceedings;

(c) the need to deter other infringements of the copyright in question; and

0064

(d) in the case of infringements for non-commercial purposes, the need for an award to be proportionate to the infringements, in consideration of the hardship the award may cause to the defendant, whether the infringement was for private purposes or not, and the impact of the infringements on the plaintiff.

(6) No statutory damages may be awarded against

(a) an educational institution or a person acting under its authority that has committed an act referred to in section 29.6 or 29.7 and has not paid any royalties or complied with any terms and conditions fixed under this Act in relation to the commission of the act;

(b) an educational institution, library, archive or museum that is sued in the circumstances referred to in section 38.2;

(c) a person who infringes copyright under paragraph 27(2)(e) or section 27.1, where the copy in question was made with the consent of the copyright owner in the country where the copy was made; or

(d) an educational institution that is sued in the circumstances referred to in subsection 30.02(7) or a person acting under its authority who is sued in the circumstances referred to in subsection 30.02(8).

(7) An election under subsection (1) does not affect any right that the copyright owner may have to exemplary or punitive damages.

0065 Personal Information Protection and Electronic Documents Act (S.C. 2000, c. 5)

3. The purpose of this Part is to establish, in an era in which technology increasingly facilitates the circulation and exchange of information, rules to govern the collection, use and disclosure of personal information in a manner that recognizes the right of privacy of individuals with respect to their personal information and the need of organizations to collect, use or disclose personal information for purposes that a reasonable person would consider appropriate in the circumstances.

5. (1) Subject to sections 6 to 9, every organization shall comply with the obligations set out in Schedule 1.

(2) The word "should", when used in Schedule 1, indicates a recommendation and does not impose an obligation.

(3) An organization may collect, use or disclose personal information only for purposes that a reasonable person would consider are appropriate in the circumstances.

7. (3) For the purpose of clause 4.3 of Schedule 1, and despite the note that accompanies that clause, an organization may disclose personal information without the knowledge or consent of the individual only if the disclosure is

(c) required to comply with a subpoena or warrant issued or an order made by a court, person or body with jurisdiction to compel the production of information, or to comply with rules of court relating to the production of records.

8. (8) Despite clause 4.5 of Schedule 1, an organization that has personal information that is the subject of a request shall retain the information for as long as is necessary to allow the individual to exhaust any recourse under this Part that they may have.

28. Every person who knowingly contravenes subsection 8(8) or 27.1(1) or who obstructs the Commissioner or the Commissioner's delegate in the investigation of a complaint or in conducting an audit is guilty of

(a) an offence punishable on summary conviction and liable to a fine not exceeding $10,000; or

(b) an indictable offence and liable to a fine not exceeding $100,000.

CJS6

Federal Courts Rules (SOR/98-106)

238. (1) A party to an action may bring a motion for leave to examine for discovery any person not a party to the action, other than an expert witness for a party, who might have information on an issue in the action.

(2) On a motion under subsection (1), the notice of motion shall be served on the other parties and personally served on the person to be examined.

(3) The Court may, on a motion under subsection (1), grant leave to examine a person and determine the time and manner of conducting the examination, if it is satisfied that

(a) the person may have information on an issue in the action;

(b) the party has been unable to obtain the information informally from the person or from another source by any other reasonable means;

(c) it would be unfair not to allow the party an opportunity to question the person before trial; and

(d) the questioning will not cause undue delay, inconvenience or expense to the person or to the other parties.