CRIA Faces $60 Billion Lawsuit

jvillain writes "The Canadian Recording Industry Association faces a lawsuit for 60 billion dollars over willful infringement. These numbers may sound outrageous, yet they are based on the same rules that led the recording industry to claim a single file sharer is liable for millions in damages. Since these exact same companies are currently in the middle of trying to force the Canadian government to bring in a DMCA for Canada, it will be interesting to see how they try to spin this."

Comments

Irony

[girlintraining]

Irony, defined: The institution responsible for changing copyright law so individuals face millions in fines and years behind jail now has to argue against it to save its own ass.

Re:Irony

[schmidt349]

Your Canadian accent makes it hard for me to understand you. I thought I heard you say "argue against it" instead of "buy off their accusers/judges/jurors."

Re:Irony

[KefabiMe]

Past evidence shows what is likely here. I know this doesn't have anything to do directly with music, but corporations have taken over the government. They insist on having the same rights as a human being, yet when it comes to punishments they know they can get away with murder.

If I had attempted to root kit even a small fraction of the PCs that Sony did, or commit copyright infringement on a much much smaller scale than what this story talks about, I would be ruined. I would lose all my possessions, probably be thrown in jail, unable to contribute to society, and disconnected from social ties. But we all know that these record companies won't be drastically hurt by this. Besides, the executives have already given themselves bonuses and spent the money on blow, or whatever else it is that these people spend millions on.

No one is going to jail over this. The industry will not be hurt. And no lessons will be learned.

Re:Irony

[erroneus]

This is shocking and awe inspiring to me. They have paid thousands if not millions to have these laws put into place. And here's the kicker -- it's not casual copying or sharing -- it's massive for-profit piracy. There should be criminal charges filed, prison time served and a massive reorganization of the companies charged.

Re:Irony

[shentino]

http://en.wikipedia.org/wiki/Judicial_estoppel

Seeing as how it was based on common law it may trace its ancestry back to Britain and might well be relevent in Canada, seeing as it's part of the empire.

Re:Irony

[Fluffeh]

Good god, I think I opened my Christmas presents early by reading this article...

If there is such a thing as a glee/giggle dance, I just did it.

Re:Irony

[Yaa 101]

If we, the public start to play along in the words war called public relations and put in front of "Sony did this and Sony did that" the sentence "The decision makers within" then sooner or later there will be an environment in which people are going to check who those decision makers are.
Expose the decision making individuals within and they will be honey to the bear lawyers out there.

Re:Irony

[ahankinson]

You need to brush up on your civics. The Queen is the Queen of Canada. She is the same physical person as the Queen of England, but legally she is two completely separate entities. She can only be advised by Canadians on Canadian matters, and legally has no ties to the UK.

The GG, especially of late, is appointed out of the people who have contributed to Canadian society. While some disagree with the value of the appointees contributions, they are largely done outside of partisan lines. This gives our head of state an important role in the system of checks and balances, and means that his or her appointment isn't subject to the same dirty tricks that typically comes with elections. The theory is that even if a party can manage to push a bad law through Parliament (especially in a majority Gov't situation), and through the Senate (a longer-term and more "sober" house, but political nonetheless), it can be stopped by the head of state if it isn't seen to benefit Canadian society. This avoids the situation we're seeing now in the US where a whole country can swing one way or another depending on which party has the president in the White House. Canada's is fundamentally a more stable setup.

The well-functioning of Canadian society depends on all three parts of government acting together, which they do most of the time with little issue. Yes, it is true that the GG can stomp on a bill, but if it's passed both the House and the Senate and hasn't raised any serious questions, then it's mostly a formality. Likewise, she can't "abolish" a law without the approval of the other parts of government either.

We need to get rid of the industry middle men

[Anonymous Coward]

So that the artists might be more directly ripped off by the filesharing.

Re:We need to get rid of the industry middle men

[pitchpipe]

People might buy more and share less if they knew that more of the money went to the artist. I don't know that for sure, but if I were a bettin' man I'd put money on it. People have a natural aversion to $BIGCORP, but they have a natural affinity for their favorite artist.

Re:We need to get rid of the industry middle men

[digitalunity]

Indeed, they are showing their true colors here. They don't care about the artists income, they care about lining their own pockets. You think when they sue consumers for copyright infringement they divvy up that money among the artists whose copyrights were violated? Nope.

They want to collect all the money without paying it out to artists. Not to mention a lot of them aren't paying artists at all, or enough for their digital downloads.

Re:We need to get rid of the industry middle men

[Zak3056]

Indeed, they are showing their true colors here. They don't care about the artists income, they care about lining their own pockets. You think when they sue consumers for copyright infringement they divvy up that money among the artists whose copyrights were violated? Nope.

Actually, the money does go to the people who own the copyrights.

That's how bad the music industry is--the typical recording contract involves a record company giving a loan to the artist (an "advance") who then finances the recording (including advertising.) The loan is paid back from owed royalties before the artist sees a dime, and when all is said and done, the record companies come out owning the copyrights to the finished product. It's like getting a mortgage, paying on it for 30 years, and at the end of the term, instead of gaining clear title, the bank says, "Thanks for the house!"

To add insult to injury, the record companies do whatever they can to screw the artist out of whatever small percentage they're due (breakage fees for 78RPM vinyl records, for example. No, I'm not kidding.)

Re:We need to get rid of the industry middle men

[sjames]

To make it worse though, they also fail to pay the royalties owed by contract on the money they get for copyright infringement. They just pocket it.

Re:We need to get rid of the industry middle men

[TapeCutter]

If an artist signs away their work without understanding the fine print then it's poor judgement on their part. If a record company routinely fails to honour contracts by witholding royalties then they are a criminal organisation.

Re:We need to get rid of the industry middle men

[clang_jangle]

People might buy more and share less if they knew that more of the money went to the artist.

It works that way for me. For several years now I've been buying music from artists who sell it directly, and using TPB for RIAA music. Though frankly, I seem to require less and less RIAA music as time goes by.

Re:We need to get rid of the industry middle men

[realityimpaired]

They are criminal organizations, but who can successfully sue them? Plus, if they can write the laws through "campaign contributions" then they are no longer "criminals" even if their activities are highly immoral and exploitive.

Buying laws through "campaign contributions" is significantly more difficult for them to do in Canada... up here, it is illegal for a corporation (either privately owned, publicly owned, or foreign owned) to give *any* campaign contributions, or other contributions, to a political party, candidate, or electoral district association. There is also a maximum on an individual's personal contributions: they cannot exceed about $1100/year (it gets adjusted every year for inflation/deflation, and is currently just over $1100). Additionally, any contributions exceeding $20 are a matter of public record. They can't get around it by donating goods/services in liew of cash, either, as the equivalent cash value of the goods/services donated are counted against that $1100.

Breaking those rules is Election Fraud, and the bare minimum penalty for a politician being found guilty of Election Fraud would be that they lose their position in parliament and are barred from ever voting or running for office again. They could, potentially, go to jail. And if it were a party that's guilty of it, they could be de-listed as an official party and lose their access to public funding for their campaigns.

References:
Relevant section of the Canada Elections Act
Online financial reports for contributions, searchable by the general public. As a matter of public record, you can also request older records by calling the phone number provided on that page.

Obligatory disclaimer:
I no longer work for that department, but I used to work for Elections Canada, and it was my job to know the Elections Act inside and out in order to be able to answer questions like this.

Meet The Old Boss... Same As The New Boss...

[MightyMartian]

All this is going to do is to convince CRIA to up the amount of money and the number of hookers it sends to Ottawa to "persuade" Parliament to pass unbalanced draconian laws that

a. Further criminalize consumers
b. Abrogate all the sins of Big Media

Look at the history of the North American recording industry. They've been ripping off artists for years. Bo Diddley was scammed out of millions in royalties by faulty userous contracts.

Estoppel in America (and hopefully Canada)

[Foobar of Borg]

In American law, if you admit something on the record (AFAIK, IANAL, DSB [disclaimers suck balls]), you are prohibited from disclaiming it later. So, if they admit that a single song is worth, say, $75k, then they will just have to suck it up when they do the same thing. Now, if they can simply throw Bitch Mainwol in jail for a number of years, I would say that justice has been served.

They deserve what they get

[appleguru]

Every penny won by the artists in this lawsuit will be deserved. I hope the CRIA is found liable for every penny of the $60 billion and is put out of business once and for all.

I also hope similar infringements are found in the United States for both the RIAA and the MPAA. No company that treats their customers as poorly as these companies do deserves to be in business.

Time to cut out the middle man. The internet has opened huge new avenues for distribution; it's time the industry starts getting on board and the artists and content creators start getting more of what they are due.

Re:They deserve what they get

[DangerFace]

I hope the CRIA is found liable for every penny of the $60 billion and is put out of business once and for all.

This is so naive it very nearly pains me. Not because you think the CRIA might lose - I think of that as optimism. No, rather because you think that $60 billion is a lot of money, and that they will have to pay it. Now, IANAL, but I am pretty sure that once a company declares itself bankrupt and disappears from the face of the Earth, that's it. Gone.

Two weeks later, the Canadian Association for the Recording Industry will pop up, and lo and behold! All the same employees, bar the dead wood they were trying to shift in the first place!

Of course, I sincerely hope I am wrong. I like to think of myself as quietly optimistic, and as such I look to a future where the greedy and the vicious are chastened by society's scorn and live lives of charity and humility. Unfortunately, while that bit of my brain is being quietly optimistic, there's another bit shouting DON'T BE SO STUPID!

I was going to go to the doctor about these voices in my head, but if the RIAA hear about them singing that Miley Cyrus song I'll be done for. No, better off just keeping quiet, like they want...

Re:They deserve what they get

[VGPowerlord]

Actually... the lawsuit names four actual companies. Big companies. Companies that have parent companies who can, in turn, be held accountable.

To be specific, the companies are Warner Music Canada, Sony BMG Music Canada, EMI Music Canada, and Universal Music Canada.

Somehow, Capital Records of Canada managed to get missed.

As a Canadian, ...

[Looce]

... and as someone who doesn't really trust companies that much, let me just say that, if the CRIA gets fined for willful infringement, I hope that this is the precedent that ends up being applied to the United States, not the reverse.

Now the recording industry's argument is going to be less and less well-received by the general population, and this can only be a good thing.

Will be resolved quickly...in CRIA favour

[Maxwell]

This will be settled ASAP by CRIA. They simply can't risk this case coming anywhere close to a decision. If they 'win' they set a precedent that borrwing files is OK. If they lose, well, they lose big!

When they settle, they will have strong 'proof' that they 'represent the artists' and will use that to help their cause. This will be over in weeks, the actualy lawsuit is just a bargaining tactic.

Moving on...

Re:Will be resolved quickly...in CRIA favour

[MightyMartian]

Let's also remember this is Canada, and so far as I'm aware, there has been no infringement case where the value per song has been pegged. While rulings from other jurisdictions may, to one degree or another, inform a ruling, US precedent has no bearing. It's quite feasible that if this were to go to trial, the judge might decide each infringement is only $1000 or $10. Since this particular situation seems restricted to record company actions in Canada, and doesn't happen in the US, it's difficult to see how the complainants can possibly hope to maintain the value per song that they're asking for.

I think CRIA will settle ASAP, but mainly to assure that there is no low-ball price per song is put on the books. Imagine if they had to argue that they should only be paying pennies per song in civil awards. When the Canadian DCMA comes along and they start pursuing file sharers, the precedent is already there that each song is only worth, say, $1 per infraction. It would pretty much wipe out any chance of fear and extortion even for those found guilty of illegal file sharing.

Re:Will be resolved quickly...in CRIA favour

[canajin56]

Except that we do have statutory damages for willful copyright infringement. They admit they knew they didn't have the rights, and that they made $50 million off selling things they were fully aware they had zero rights to. In fact, this is a class action, over the fact that they have used a total of THREE MILLION SONGS WITHOUT PERMISSION. The law is clear, $20,000 per instance of copyright infringement. You're right, the Canadian courts haven't tested the legal principal that copyright infringement laws really mean per copy, not per copyrighted song that you misappropriate. If Canadian courts HAD approved such an absurd notion, then the CRIA members would be faction quadrillions in damages, where each CD they sold would mean them owing $20,000 per song, PER CD. Instead, it's limited to per song.

Re:Will be resolved quickly...in CRIA favour

[Beardo the Bearded]

In Canada, it's still not a violation of copyright law to copy something for personal use. The last two attempts to change the law (Bills C-60 and C-61) were put aside during the last few elections.

It is, and always has been, a violation to provide the copies. This provides the interesting point where if someone downloads an album via Azureus, that's legal up until the point when you start seeding. (Which is, of course, before you're done downloading, but that's a matter for the philosophers.) In short, up here, it's legal to download but unlawful to upload.* That's because we pay a CIRA levy on all blank media; a "pirate tax", if you will. CIRA has already decided that I'm going to use that spindle of DVD-Rs for pirating, so I should pay a little extra at the counter to compensate them for the loss of revenue. I am not making that up.

Now, the proposed penalties for uploading under C-61 were $20k per offence. It was $500 for downloading, or $20k if you broke any encoding whatsoever. These values were going to be put into Canadian law but were fortunately stopped by government instability. (That's a much longer story than /. has time for.)

Canadian law does not require our judges to use previous cases as a stepping point for punitive damages; you won't see a billion-dollar fine put up simply because you have to have a rationale for the punishment.

Our courts are also loser-pay, which is why you can't just drop a lawsuit or you admit you've lost and will have to pay the costs. If they were to sue, say, me, I would refer them to my lawyer. They know that I've got one, and that that first call is likely to cost them the $200 once the dust settles. (I would call her in the meantime and tell her to have No Mercy.) You won't get scare-tactic suits up here like you have in the states.

* I know that not all copyright infringement is music-sharing online. In fact, the most dangerous type (from my EE perspective) is false labelling on electronics, especially circuit breakers and other protective devices. This is an endemic problem and it's scary as fuck when a 200A breaker keeps going and melts into fucking slag at 400A.

justification

[kbob88]

Wait, so the majors have been selling CDs for over thirty years with songs they don't own the copyright on?? They've been charging consumers for something they didn't own?

And they wonder why consumers are downloading music...

In retrospect, I don't think we've been pirating music at all over the past decade or so. We're all just small record labels that have been creating (very limited run) compilation CDs and putting the songs on our own 'pending lists'. We fully intend to pay the rights holders, once we can locate them and negotiate rights. Brilliant idea, guys! Thanks!

I think the number is still low...

[Fallen Kell]

Seriously, I think the $60 Billion is still extremely low. At $20,000 per violation, that means only 3,000,000 violations, which I think is very light for the class of 300,000+ songs that are in the Payment Pending list. That is only estimating that 10 copies of each song were sold this way. The real numbers exist. They can find out EXACTLY how many copies of EACH unauthorized song were sold as all of that is accounted for each individual CD/Album/MP3 from the CRIA members. If we use the REAL number of songs and counts of infringement. I think we are talking easily more than 50 million violations here, not 3 million (which is only 10 sales per song, and we ALL know that a production run of CD's will be in the thousands each, and each COPY is a violation, not just each SALE, even broken CD's at the manufacturing site are unauthorized copies that took place (you know all that breakage cost part that they put into the contracts), they still count in terms of unauthorized/pirate copies). And remember, it is per song, so an album may have 15+ individual infringements in it, not a single infringement for the entire album.

Like GM?

[SydShamino]

I wonder if this will eventually turn out like GM and its dealings with the unions over the years. Bear with me...

GM corp. and shareholders spent decades working out deals with the unions, trying to minimize labor costs. They made deal after deal that would do things like promise better pensions, all to keep current costs down.

Then, when it all came crashing down, the net result was that the labor union ends up as a major (the major, after the government) shareholder in the company. All that effort goes to naught when it resulted in the "little people" gaining complete control of the company.

So I'm reminded of it here because the CRIA and RIAA and their kind have spent years creating the webs of copyright law that they now use to sue their customers. It would be fitting and just if those same laws lead to the "little people" - the artists - taking control of the industry.

Were I an artist in this case, I'd readily accept a major stake in the company in lieu of the settlement, especially if it was likely that the settlement would force them into bankruptcy and I'd never see my money anyway. Enough suits like this, and we could stroll in and fire the board and all the executives, and turn it into something that serves the artists and consumers.

The shoe is on the other foot

[Joce640k]

This time they're the defendent so they're not allowed to mysteriously 'drop' the case. They can be forced to go to trial.

Do as I say...

[gzearfoss]

I predict that the CRIA will have a sudden change in heart about copyright violation enforcement - that will last as long as it takes to get this case dropped or settled. Then, it'll be back to business as usual.

The question is, where did the money for the royalties from these CDs end up?

Re:my bet

[Anonymous Coward]

They'll put it on their "Fines Pending" list.

CRIA will never get nailed for this

[Phrogman]

Because here in Canada we have been following the same evolution of Capitalism that the US has adopted: companies (or groups of them) are superior to individuals and are held to a different standard. By all rights they should be forced to pay the billions in damages that they have earned by violating the laws they use as justification to get music downloaders to pay in court. They should get bit in the ass by the same principles they have been applying.
I am far too cynical to believe this will happen though, as I am sure many of you are. The right bribes will be paid to the right Canadian politicians and they will pay a few million in damages and that will be that. I don't trust Harper's government further than I can puke (and I almost do everytime I remember that we elected him. I am ashamed my country could possibly do so), and I expect them to suck up to the big music industry corporations and settle things quietly in their favour.
I sincerely hope I am wrong but I am far too cynical to think it will happen. We have government by corporation these days and they determine the laws and penalties.

I would like to point out:

[NoYob]

notes in his affidavit that "the record labels have devoted insufficient resources for identifying and paying the owners of musical works on the pending lists." The CRIA members now face the prospect of far greater liability.

I'm assuming that the CRIA is basically the Canadian branch of the RIAA, or at least affiliated with it?

So, let me get this straight, those people can track down some college kid over the whole internet, what was probably using some dynamically assigned IP address, who may have moved a few times, etc.. and the CRIA can't find Bruce Springstein or even some lesser known artist because they haven't allocated enough resources?

Riiiiiiigggght.

Worldwide practice

[XSforMe]

The big labels have been pulling this stunt world wide during years. Recently in Mexico, Police raided the major offices of Sony after it decided to tell Alejandro Fernandez (a Mexican folk country singer) they were going to publish some of his tunes with or without his permission. After the smoke had settled, the Police seiged over 6K pirated CDs from the same offices of those who can't keep their mouth shut when it comes to bashing pirates.

This isn't irony...

[bennomatic]

It's what copyright law was intended for. It's not Joe Schmoe making a mix CD for his best friends that's a problem. It's not even the guy who allows 10,000 people who weren't going to buy an album anyway to download it from his server. The problem is people and organizations who make a career out of profiting from other people's work.

The RIAA, CRIA and the MPAA are effectively no better than pimps. It's good that the law is finally being applied as it should.

Re:This isn't irony...

[Hatta]

It's what copyright law was intended for.

That's what is ironic about it.

Re:This isn't irony...

[gmhowell]

GP thinks irony is like rain on your wedding day.

Re:wouldn't it be nice..

[VGPowerlord]

CRIA is a mini-me of the RIAA and with any luck, they will be sued out of existence before they bring a backward, Draconian & American DMCA to Canada. But I doubt it.

(no offense Americans.. unless you're one of the cronies who created the DMCA)

Trust me, we don't take offense to this. The DMCA was one of the most backward laws the US government has been bribed... er... incentivized to pass.

Almost as backwards as the Copyright Act of 1976 and moreso than the Copyright Term Extension Act of 1998.

Hey CRIA!

[Hurricane78]

CRIA me a river!

CRIA? same as RIAA: they're WESU !

[KWTm]

I had previously suggested that RIAA was just a disguise, a mask used by the Big4 companies behind RIAA, and suggested that we actually refer to them by name: Warner, EMI, Sony, and Universal. Together they form the acronym WESU, as in "We sue! Yes, we do!"

Now this CRIA organization is suing. Hmm... let's see who the big members are. From TFA:
"The defendants in the case are Warner Music Canada, EMI Music Canada, Sony BMG Music Canada, and Universal Music Canada, the four primary members of the Canadian Recording Industry Association."

Sound familiar???? Good thing we unmasked the Big4 companies as WESU!

Re:CRIA? same as RIAA: they're WESU !

[roesti]

I had previously suggested that RIAA was just a disguise, a mask used by the Big4 companies behind RIAA, and suggested that we actually refer to them by name: Warner, EMI, Sony, and Universal. Together they form the acronym WESU, as in "We sue! Yes, we do!"

That's for the US, though. This is the Canadian affiliate, WESUC.

It occurs to me that there was some odd truth told

[erroneus]

In all the years of whining and complaining about needing stricter laws and harsher punishment and longer copyright terms, they always cited that the artists and their families are not getting paid because of piracy!

Well, I guess they weren't exactly lying were they. It's just that the people they claimed to be responsible for the atrocities against artists were not the file sharing public, but themselves.