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Digest of the Week: Crown Copyright

P.S. Knight Co. Ltd. and Gordon Knight v. Canadian Standards Association, 2018 CarswellNat 7612, 2018 FCA 222

The Canadian Standards Association is a federal not-for-profit corporation governed by the Canada Not-for-profit Corporations Act, S.C. 2009, c. 23 that develops, tests, and certifies voluntary standards -- the CSA Electrical Code ("Code") being the most important. Knight Co. is a commercial competitor of the CSA. Knight Co. published a simplified version of the Code called the Electrical Code Simplified ("ECS").

For several years, the two parties had a good working relationship. However, in 2016, Knight Co. reproduced, and threatened to distribute, a complete and identical copy of the 2015 version of the Code at one-third CSA's price. In response, the CSA initiated the application which is now the subject of the appeal at the Federal Court of Appeal. 

The Federal Court found that copyright subsisted in the 2015 version of the Code, that the CSA owned the copyright, and that Knight Co. could not rely on the defences of fair dealing or licence. The Federal Court granted the CSA an injunction restraining reproduction, publication, and sale of any infringing works by the respondents, $5,000 in statutory damages, and $96,336 in statutory costs. The respondents appealed.

On appeal, the Federal Court of Appeal determined that the CSA owned valid copyright in the 2015 version of the Code, and further found that the Code cannot be said to be published by or under the direction or control of the Crown or a government department. The Federal Court of Appeal rejected several of the appellants' arguments, some of which were based on the provisions in Section 12 of the Copyright Act, the Crown's prerogative rights and privileges outside the Copyright Act, and public policy reasons.

The appeals of the injunction and the lump-sum costs award were both dismissed.

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