US firm runs mass copyright shakedown in Canada

When Canada’s new copyright rules went into effect in January, critics feared that someone would use them to run settlement extortion schemes of the sort that have long plagued the American legal system. Those fears have proved to be justified. This week, a second U.S. company has come into Canada, apparently using an automated process to blast thousands of settlement notices far and wide.

If you’re unfamiliar with the scheme, it works like this: under Canada’s new rules, a copyright owner who detects an unauthorized download can send a notice to the subscriber’s ISP, which is then obliged to notify the subscriber. The problem is that copyright owners can abuse the system by sending out notices that are actually threats, based on false information, and scare people into paying a settlement.

This has already happened once when a company called Rightscorp began making outlandish claims based on American law (for instance telling notice recipients that they faced $150,000 fines for downloading songs — even though the maximum fine in Canada is $5,000).

Now, a second group is trying its luck. This time, the culprit appears to be the porn industry working with an enforcement firm called CEG TEK. Lawyer Bram Abramson, who is counsel for a Canadian ISP, took to Twitter to flag what’s going on:

In other words, CEG TEK is using a bot to send out thousands of “notices” that are, in reality, shakedown letters. Recipients of such notices are typically invited to call a number where someone squeezes them to pay up what they can before something much worse happens to them (the enforcement agency and the copyright owner then divvy up the proceeds).

Law professor Michael Geist, who also reported on the story, observed that the latest notices aren’t as egregious as the previous Rightscorp batch. The CEG TEK notices at least claim to be based on Canadian law, even though they also misrepresent the damages at stake as well as other basic facts about the process.

But as Geist points out, they are still a gross abuse of the process, and also impose a financial burden on Canadian ISPs, who are obliged to process this flood of trumped up notices. Both Geist and Abramson recommend the Canadian government pass regulations to curb this sort of abuse, possibly by imposing a charge on those who send notices.

Some readers will point out that the letter recipients shouldn’t be infringing copyright in the first place, and they deserve what they get. The problem with this attitude, in my view, is that it encourages an abuse of the legal process (never a good thing), and undermines overall respect for copyright law. A better approach would be for copyright owners to follow the process in good faith, and save the big legal guns for repeat and flagrant offenders.