The “Obituary Piracy Case” and what it means for Canadian copyright law

The Federal Court’s recent decision in the case of Thomson v Afterlife Network Inc. (already known as the “Obituary Piracy case”)  is the latest authority on some interesting copyright issues, including:

• How should damages be assessed in a case where there are millions of works in which copyright has been infringed and potentially millions of copyright owners?
• What evidence is required to prove moral rights infringement?
• In what circumstances will a “wide injunction” against infringement in other works be warranted?

Background The case was brought by Dawn Thomson who wrote an obituary for her late father which she permitted a local funeral home and community channel to publish alongside a photo she had taken of her father. In January 2018, Ms. Thomson discovered that her father’s obituary and photo had been posted on a website called Afterlife which included advertisements, as well as options to buy “virtual candles” or send flowers to the deceased’s family – all of which generated a profit for Afterlife. Afterlife’s website contained approximately two million other obituaries and photographs which had also been reproduced from the websites of Canadian funeral homes and newspapers. Ms. Thomson brought an application in the Federal Court against Afterlife Network Inc. for copyright and moral rights infringement. Her application was subsequently certified as a class proceeding with Ms. Thomson as the representative applicant for the more than one million Canadian individuals and estates who had authored the obituaries and photographs reproduced on Afterlife’s website. Copyright Infringement and Statutory Damages Drawing on the Supreme Court of Canada’s oft-cited decision in CCH Canadian Ltd v Law Society of Upper Canada, Justice Kane of the Federal Court held that the obituaries are original works in which copyright subsists and that the authors of the obituaries are the rightful copyright owners. She held that Afterlife had infringed the authors’ copyright in the obituaries pursuant to sections 3(1) and 27(1) of the Canadian Copyright Act. An interesting issue before the court was how to assess damages in a case like this where there are millions of works in which copyright has been infringed and potentially millions of copyright owners. Where actual monetary damages resulting from infringement are difficult or impossible to prove, the court can award “statutory damages” under section 38.1 of the Copyright Act. This allows a court the flexibility to award damages based on factors such as the good or bad faith of the infringer, the purpose of the infringement and the need to deter other infringements. Because Afterlife was profiting from advertisements and the sale of “virtual candles”, Justice Kane held that the infringement was for a commercial purpose for which section 38.1 prescribes a minimum award of $500 per work infringed. However, she noted that this would amount to approximately $1 billion in statutory damages for the two million works infringed in this case which would result in an award grossly out of proportion to the infringement. She also noted that assessing damages on an individual basis in a class proceeding such as this would be impractical.  Justice Kane resolved these issues by relying on Section 38.1(3) which allows the court to award less than $500 per work infringed where even this minimum amount would result in a disproportionately large award. She agreed with the applicant that $10,000,000 in statutory damages would be a just and appropriate award in this case (plus another $10,000,000 in aggravated damages). She also exercised her discretion to award damages on an aggregated basis, to be divided proportionally among the class members since it would be impractical to assess damages on an individual basis given the size of the class. Given the Internet’s potential to enable copyright infringement on such a large scale, it will be interesting to see the extent to which Canadian courts exercise their discretion in a similar manner in the future in similar cases of large-scale copyright infringement. Moral Rights Thomson v Afterlife also involved a claim for moral rights infringement. Specifically, Ms. Thomson, as representative of the plaintiff class, alleged that her honour and reputation had been prejudiced by the placement of advertisements next to her father’s obituary, in violation of Ms. Thomson’s right to the integrity of her work under sections 14 and 28 of the Copyright Act. Drawing on Canadian case law on moral rights infringement – including Collett v Northland Art Company (where Shift Law obtained substantial damages for moral rights infringement on behalf of a commercial photographer) – the Federal Court ultimately concluded that Ms. Thomson’s moral rights had not been infringed by Afterlife. The Federal Court’s holding on moral rights turned on the fact that Ms. Thomson had not led extrinsic evidence to meet the objective branch of the test for moral rights infringement. The Federal Court explained that to establish an infringement of the author’s right to the integrity of their work, the author must show, with subjective and objective evidence, that his or her honour or reputation have been prejudiced. Ms. Thomson and the other class members produced subjective evidence describing the embarrassment, anger, and sadness they experienced upon discovering that their loved ones’ obituaries were being used to generate profit for Afterlife. However, the court held that outside evidence, in the form of public opinion or expert evidence, was also required to establish that Afterlife had prejudiced the author’s honour or reputation. Because no such evidence was produced, the Federal Court held that the burden of establishing moral rights infringement had not been met. Contrast this with Collett, where the plaintiff was successful in establishing moral rights infringement on the basis that the defendant had infringed the plaintiff’s right to be associated with his work under section 14.1(1) of the Copyright Act. In Collett, there was factual, objective evidence that the defendant had replaced the plaintiff photographer’s name with that of another photographer on prints that were sold to a customer. Based on the evidence, the court held that Mr. Collet’s moral right to be associated with his work had been infringed by Northland Art Company and the other named defendants. Read together, Collett and Thomson establish that when claiming moral rights infringement, either for violation of the author’s right to be associated with a work or for violation of the author’s right to the integrity of the work, objective evidence is critical. Evidence of an author’s personal feelings will be insufficient. Injunctive Relief Thomson v Afterlife also included claims for both a normal injunction to stop Afterlife from continuing to infringe the class’s rights and a wide injunction prohibiting Afterlife from infringing the class’s rights in other works in the future. Ultimately, the court concluded that a normal injunction was warranted but a wide injunction was not. In so doing, the court affirmed that a wide injunction is only warranted where a likelihood of future infringement in other works is demonstrated. In Thomson v Afterlife, the court held that the plaintiff’s claim that Afterlife would repeat its infringing conduct in respect of other works in the future was speculative and, therefore, a wide injunction was not justified. In so holding, the court re-iterated some requirements for wide injunctions that bear repeating.  It must be sufficiently demonstrated through evidence that the infringer is likely to continue infringing the plaintiff’s copyright and/or moral rights in other works in the future. In other words, a wide injunction does not prohibit an infringer from infringing just any copyright or moral right – indeed such conduct is already prohibited by the Copyright Act. A wide injunction simply enjoins an infringer from infringing the successful plaintiff’s rights in their future works. Because there was no evidence before the court in Thomson v Afterlife that the class members would author future obituaries, the court declined to grant the wide injunctive relief sought by the applicant and held that normal injunctive relief was sufficient in the circumstances. The court’s holding affirms that speculation of future infringement does not justify a wide injunction, rather a likelihood of future infringement must be demonstrated – as in Nintendo of America Inc. v King. Conclusion  The key takeaways from Thomson v Afterlife can be summarized as follows:

• A claim for moral rights infringement requires more than just subjective evidence that an author’s feelings have been hurt. Objective evidence is also required to demonstrate that the authors’ honour or reputation have been prejudiced.
• Statutory damages are flexible in nature. While the Copyright Act prescribes a range and factors to be considered in awarding statutory damages, a court has considerable flexibility to award statutory damages in whatever amount “feels right”.
• A court will not grant a wide injunction on mere speculation alone. A plaintiff must demonstrate that the defendant is likely to infringe the plaintiff’s rights in other works authored by the plaintiff in the future.