Reining in the Cable Killers: Federal Court Orders Crackdown on TV Set-top Boxes with Copyright-infringing Applications
On June 1, 2016, the Federal Court granted an interlocutory injunction against retailers of television set-top boxes with pre-loaded applications that permit the unauthorized streaming and downloading of copyrighted content. Recognizing the “emerging phenomenon” of “pre-loaded set-top boxes” in Canada, this injunction comes at a time of rapid growth in the popularity of such devices. Finding for the plaintiff broadcasting companies, the Court’s Order in Bell Canada et al. v 1326030 Ontario Inc. et al., 2016 FC 612 also permitted the plaintiffs to identify and add other retailers of pre-loaded set-top boxes as additional defendants to bring them under the injunction.
As of June 13, 2016, two of the five retailers originally brought under the injunction are now in the process of appealing the order.
The plaintiffs, including Bell Media Inc. and Rogers Media Inc., are well-known Canadian broadcasting companies and broadcast distribution entities that own or licence the copyrighted television content made accessible by the pre-loaded set-top boxes.
The defendants are individuals and businesses that sell set-top boxes on which they have installed or otherwise “pre-loaded” applications designed to access copyright-protected content. Advertised as “Cable Killer[s]” capable of accessing free television content while allowing the avoidance of cable fees, these “plug-and-play” set-top boxes are pre-loaded with:
- KODI, an open-source media player that, with proper add-ons, could be used to access online streaming websites;
- Showbox, a media player application that permits the access of online streaming websites to permanently download television or motion picture content; and
- Private IPTV services that permit the re-transmission of television broadcasts over the internet for a monthly fee.
Finding of the Federal Court
The sole issue in this motion was whether an interlocutory injunction should be granted. Pursuant to the three-part test established by the Supreme Court of Canada, the granting of an interlocutory injunction requires the satisfaction of three conditions:
- there must be a serious question to be tried;
- there must be irreparable harm; and
- the balance of convenience must weigh in favor of the person requesting the injunction.
Finding that inducing consumers to commit copyright infringement was indeed a serious issue, the Court accepted that the plaintiffs have established a strong prima facie case of copyright infringement under both the Copyright Act and the Radiocommunications Act. Rejecting the defendants’ claim that they were merely selling hardware with non-infringing uses, the Court found prima facie evidence that the defendants were actively enabling consumers to commit copyright infringement through the use of the device.
The Court was also satisfied that the plaintiffs would suffer irreparable harm if the injunction was not granted. Recognizing that “the market for pre-loaded set-top boxes will keep growing if left unchecked”, the Court found that the actions of the defendant retailers, if not restrained, would incentivize consumers to permanently cancel their cable subscriptions.
Finally, determining that the defendants’ business activities will not unduly suffer from being restricted to only “legal [and] non-copyright-infringing” applications in their set-top boxes, the balance of convenience was found to weigh in favour of the plaintiffs.
This interlocutory injunction demonstrates that the Federal Court is willing to adopt a strong position against emerging technologies that promote or enable copyright infringement. In particular, by allowing the plaintiffs to expand the scope of the injunction through the inclusion of additional defendants, the Court has sent a clear message empowering copyright holders to act in the face of these emerging technologies.
Observing that “[t]his is not the first time a new technology has been alleged to violate copyright law...nor will it be the last”, the Court’s Order suggests to copyright holders that interlocutory injunctive relief may be available against those who utilize new technologies to commit copyright infringement. Given the importance of this remedy and the national ambit of the decision, copyright holders across Canada would be well-advised to follow this case and the pending appeal of this injunction.
*Eriq Yu is summer student in McCarthy Tetrault’s Toronto office.
injunctions IP Litigation