Court dismisses appeal of set-top box sales ban

MONTREAL — The Federal Court of Appeal dismissed Monday a challenge to an injunction on the sale of pre-loaded set-top boxes. “In our view, in light of the uncontradicted evidence, including the advertisement that these pre-loaded set-top boxes are a way to access free TV content and avoid cable bills, the Federal Court was entitled to draw the inferences that it did,” Justice Johanne Gauthier said in her decision. The appeal was launched in June 2016, following a court-ordered ban on the sale of set-top boxes loaded with applications that allow users to access TV content. BCE Inc., Rogers Communications Inc. and Quebecor Inc.’s Videotron had sought the injunction, which was ordered by judge Danièle Tremblay-Lamer earlier that month. Frederick Pinto, a lawyer for MtlFreeTV.com’s Vincent Wesley, one of the defendants in the case, told the court that the three companies hadn’t proven they would suffer irreparable harm as a result of the set-top box sales. The companies earlier argued in earlier court documents that it would be “virtually impossible” to quantify such damage. Pinto said Monday the companies had claimed there was a growing market for set-top boxes, but had provided “no numbers,” only observations in an affidavit. “If I’m going to make a statement that a market is growing, that is a numerical quantity that I’m expressing. If I just happen to notice things, that is just anecdotal evidence,” he said. Pinto also said that judge Tremblay-Lamer’s statements that purchasers of set-top boxes have an incentive to cut their TV subscriptions “makes a huge assumption” that the individuals in question have subscriptions in the first place. “I believe it was just normal to her that everyone has a subscription,” he said. Pinto added that a “cord-never who purchased a set-top box might have never been a customer of the plaintiff — ever. This is a generational difference. It used to be that having a subscription was just a public good. It was like having a phone line. Today, we’re in a world where that’s no longer the case.” Gauthier noted: “don’t forget, even at my age I don’t have cable. It’s not just the new generation.” Pinto said that the TV providers “still live in a world where everyone has cable.” He also argued that the set-top boxes are “multipurpose” products. “The purpose of these products is not only to give access to the defendants’ programming,” he said. “It’s not like an infringing pair of shoes whose only purpose is one thing… when it’s multi-use equipment, it’s extremely important to show some version of causation,” like industry data, forum discussions or surveys, even if it’s not possible to track down individual purchasers to determine they cancelled their TV subscriptions. Francois Guay, who argued on behalf of the TV providers, noted that the case has continued adding defendants since it was first launched, growing from five defendants to the current 68. It’s “not possible” to identify all clients from these 68 companies, he told the court in French. Instead, the proof of causality is that the companies sell the set-top boxes by advertising them as something that allows customers to get rid of their TV subscriptions. “They sell these boxes because the customer comes to them because they saw the advertisements, and they say to themselves ‘if I buy this box for $150, $200,’ I can call Videotron and tell them to cancel my subscription,” Guay said. Rogers spokeswoman Sarah Schmidt said in an emailed statement that Monday’s decision “speaks to what this case is all about — an obvious case of piracy. Today’s ruling is an important step in ensuring illegal sharing of our content doesn’t get a free pass and the folks who create and produce it get paid for their work.” Marc Choma, a spokesman for Bell, said in an email that the “courts continue to affirm our position that these boxes are illegal and those who continue to sell them will face significant consequences, such as contempt charges. The Canadian legal system is taking strong action against content piracy and its negative impact on the country’s creators and broadcasters.” — With reporting by Anja Karadeglija at akarad@thewirereport.ca and editing by Charelle Evelyn at cevelyn@thewirereport.ca

Court dismisses appeal of set-top box sales ban

News | March 20, 2017

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Court dismisses appeal of set-top box sales ban

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