CRTC Incurs Second Lawsuit Over Bill C-11 Courtesy of the MPA

The CRTC’s efforts to implement Bill C-11 was so nice, they got sued twice. This time, it comes from the MPA.

Throughout the Bill C-11 debate (a bill that would later be called the Online Streaming Act), I pointed out numerous times that the legislation would eventually be subject to litigation. I wasn’t the only one either as numerous other experts have also agreed with that assessment as well. The government, however, took a head in sand approach and just assumed that the worries about litigation for this deeply flawed legislation just magically won’t materialize.

Unsurprisingly, ignoring legal realities won’t magically make all the legal problems go away on their own. Experts like myself have warned that litigation was a sure thing not because we personally don’t like the legislation, but rather, because it was an obvious outcome of pushing something so blatantly unconstitutional.

Earlier this year, the least surprising outcome finally occurred when Google filed a lawsuit against the CRTC. The lawsuit was sparked due to the deeply flawed thinking that revenue generated from user generated content would be subject to a tax that would get funnelled directly to the cultural elite including Canada’s largest broadcasters. It’s unfair and, as far as I’m concerned, amounts to blatant theft of revenue’s.

Now, we are learning a second lawsuit has been filed against the CRTC. The Motion Picture Association (MPA) has sued the CRTC over the Online Streaming Act. A reg-walled article on CARTT does offer a preview which explains the general rationale for the lawsuit:

One of the major contention points throughout the CRTC’s proceeding to bring online streamers under its ambit is now the subject of a judicial review application at the Federal Court of Appeal, as the Canadian affliate of the Motion Picture Association (MPA) hopes the court will hear its argument that foreign streamers shouldn’t have to contribute to a news fund from which its members derive no benefit. As part of the implementation of the Online Streaming Act, the regulator issued a proposed order early last month that foreign streamers making $25 million or more must contribute five…

This has long been one of the numerous problems with the Online Streaming Act. Originally, the idea was that streaming platforms contribute to funds associated with the creation of creative content made in Canada. When it became abundantly clear that the Online News Act was failing, lobbyists demanded last minute changes that say that news organizations should also be able to pillage money from the Online Streaming Act pie.

The CRTC, for their part, simply went along with it. After all, they aren’t about to start making decisions that would upset their lobbyist buddies, so they just said that news organizations should also be plundering those revenues as well. It was a pretty blatant attempt to shore up losses from earlier greedy failed attempts to leech off of the system to service their hedge fund overlords interests.

Making streamers pay for news content never made any sense at all in the context of the Online Streaming Act. There was never any basis for the argument that streaming services somehow negatively impacted news consumption when it was clear that news broadcasters and publishers could benefit from the opportunities presented by various streaming services (or even do something actually rational for a change and create their own service that houses multiple broadcasters content, but that would be sensible and that’s the last thing they want to do). As a result, the efforts to siphon money out of the system like this was always going to be legally problematic.

With this latest legal action, it seems that the MPA has caught on to this and found a legal argument to say that news publishers shouldn’t have access to the streaming revenue in the first place. With the argument that we know of revolving around how the MPA’s members would never derive any benefit from such a system, it is reasonable to assume that they are going to claim that this is discriminatory practices against their businesses. To be perfectly honest, there is a case to be made for this.

As I’ve mentioned before, once the lawyers are sent in, this will, among other things, delay the implementation of the Online Streaming Act. It will ultimately make even the delayed variation of the CRTC’s implementation timeline seem aspirational. As a result, that is good news for those who support freedom of expression because it means the government won’t be downranking people’s content as soon as the government had hoped.

If things continue the way I think they will, this will be far from the last lawsuit to strike the CRTC as well in response to this legislation. There is also the inherent problems of Canadian voices getting downranked through CRTC algorithmic manipulation. A lawsuit pointing out that this infringes on freedom of expression becomes extremely obvious given that it’s the government that is suppressing that speech. What’s more, there is the unfair access to whatever funds comes from this when Canadian creators get denied financial aid while the corporate world is free to hoover up any funds they like. I wouldn’t honestly be surprised if that would also be the subject of a lawsuit as well. Such litigation won’t be happening tomorrow as there are still decisions left to render and consultations to be made on the CRTC’s part.

At any rate, all of this was predictable. It wasn’t a matter of “if”, but “when” these lawsuits were coming down. The CRTC is going to have a tough uphill battle to climb on these fights and the number of legal fights they are in for is only going to continue to rise. This isn’t even getting in to the international trade agreements this new law violates. The government chose to ignore reality and just attack those making their valid concerns heard. This proved to be a major fatal mistake as no amount of believing hard enough was going to alter legal reality. The increasing number of lawsuits are now bursting the reality bubble that the government has set up for itself.

(Via @MGeist)

Drew Wilson on Mastodon, Twitter and Facebook.

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