The popularity of user-generated content (UGC) (material uploaded to the Internet by website users1), is relatively recent and legal theories are still developing on when liability will attach to those that post UGC and those that facilitate such posting.
UGC exists in a variety of forms, including blogs; micro-blogs (such as Twitter); user reviews (such as on Amazon.com); content uploaded to social networking sites (such as Facebook and LinkedIn); photographs and videos uploaded to file-sharing sites (such as Flickr and YouTube); information uploaded to wikis (such as Wikipedia); and content uploaded to virtual world websites (such as Second Life).2
The most widely-used websites devoted to UGC are YouTube and Facebook.3 Twenty-nine hours of video are uploaded to YouTube every minute, the vast majority of which are UGC.4 The site reached 134 million unique viewers during December 2010,5 and Facebook surpassed 500 million unique visitors in April 2010, making it the fourth most visited website in the world.6
The widespread and increasing popularity of UGC has led many businesses to utilize UGC in their corporate websites to attract the millions of users who consume and create UGC. For example, companies create corporate blogs that invite comments and responses from consumers, integrate customer product reviews into their website designs, and use UGC in their advertising campaigns, which can enhance brand loyalty by enabling consumers to express their ideas and enthusiasm about products.7 Some companies utilize social networking sites, such as Facebook and Twitter, to create brand awareness and to disseminate information and promote events with more rapid and widespread coverage than traditional modes of communication.8
Legal Issues Surrounding UGC
Website Operators’ Liability for Infringing UGC Posted on Their Sites
Copyright
The unauthorized posting of copyrighted UGC online is prohibited by Canadian copyright law.9 If an Internet user uploads infringing content to a website, both the user and the website operator may, subject to any available defences, be liable for copyright infringement.10
In Canada, website operators (and posters of UGC) would be able to raise a “fair dealing” defence if the UGC is used for certain enumerated purposes, including research, private study, criticism, review or news reporting, and if the source of the work has been sufficiently acknowledged.11 The scope of the current Canadian fair dealing defence is not entirely clear as there is a lack of jurisprudence on the issue.12 For example, although parody has not been expressly recognized by Canadian courts as a defence to copyright infringement, courts have suggested that it may qualify as protected “criticism”, provided that the requirements of the Copyright Act are satisfied.13
The Copyright Act provides immunity from liability for copyright infringement to those persons whose acts consist only of providing the means necessary for another to communicate the copyrighted work.14 The Supreme Court of Canada discussed this issue in the context of online activity in a 2004 decision15 (SOCAN) and held that the Copyright Act does not impose liability for infringement on intermediaries, such as Internet service providers (ISPs), who supply software and hardware to facilitate use of the Internet and act merely as a conduit.16
However, where an ISP receives notice that infringing content has been posted on its facilities, a failure to remove that content may attract a finding that the ISP authorized the communication and is liable for infringement.17 In SOCAN, the Supreme Court indicated that Parliament should enact a statutory “notice and take down” procedure as has been done in the European community and the US.18 The copyright bill currently before Parliament19 proposes a “notice and notice” regime, whereby if a copyright owner sends a notice to an ISP (in the prescribed form) that its works are being infringed on the ISP’s system, the ISP must then forward the notice to the alleged infringing subscriber.20
The extent to which the SOCAN decision applies to a website operator in the context of infringing UGC posted on its site is not clear. SOCAN was decided before the rise of UGC and dealt with conduit-like ISPs rather than corporate websites or UGC websites such as YouTube. The situation is clearer in the US: the “safe harbour” provisions of the Digital Millennium Copyright Act grant online service providers protection from liability for infringing information residing on their systems or networks at the direction of users, provided certain prescribed conditions are met. These provisions have been interpreted by the courts to expressly apply to website operators.21
Defamation
Defamation can be defined as a false statement to a person’s discredit.22 In order for an action to succeed, the defamatory remark must have been published, which means that it must have been communicated to some person other than the plaintiff.23 The posting of defamatory comments on a website has been held to constitute publication.24 A recent Canadian case held that merely providing a hyperlink (which may be considered to be UGC) to defamatory material does not constitute publication of the material found at the hyperlinked sites.25
Many website operators do not monitor the content posted to their websites, providing users with the opportunity to post defamatory material.26 False or misleading statements posted by a user may lead to claims of defamation against the website operator. In the US, the Communications Decency Act27 (CDA) provides immunity to Internet service providers, including website operators, for the posting of defamatory content by a third party.28 In Canada, there are no statutory protections analogous to the provisions of the CDA to protect website operators from defamatory material posted on their sites and Canadian courts have yet to clarify the issue of whether and when a website operator will be held liable for such defamatory posts.29
Compelling Disclosure of Users’ Identities
(i) Copyright Infringement
In BMG Canada Inc. v. John Doe30 the Canadian Federal Court of Appeal set out the threshold test copyright owners must meet in order to obtain disclosure of the names and addresses of identified online infringers of copyrighted works from ISPs.31 The copyright owners must demonstrate that: (i) they have a bona fide claim against the proposed defendant; (ii) the ISP is somehow involved in the matter under dispute and not an innocent bystander; (iii) the information cannot practically be obtained from another source; (iv) the ISP can be reasonably compensated for its expenses associated with the disclosure order; and (v) the public interest in favour of the disclosure outweighs legitimate privacy concerns.32
The Court held that, where there exists evidence of copyright infringement, privacy concerns may be met by a confidentiality order or an order that the user only be identified by initials.
(ii) Defamation
In September 2009, the Ontario Superior Court of Justice granted an order requiring two Canadian ISPs to disclose information necessary to identify the anonymous authors of an allegedly defamatory website post.33 In reaching its decision, the Court considered the same factors as those set out in BMG v. John Doe.34
Privacy Issues
Website operators incorporating UGC must ensure that they comply with their own privacy policy as well as applicable privacy laws. In Canada, the federal Personal Information Protection and Electronic Documents Act 35(PIPEDA) governs the collection, use and disclosure of personal information in the course of commercial activities.36 PIPEDA provides that personal information may only be collected, used or disclosed by an organization with the knowledge and consent of the individual, with limited prescribed exceptions.37 In addition, information about an organization’s privacy policies and practices must be readily available to individuals upon request.38
The Office of the Privacy Commissioner of Canada (the “Office”) investigates complaints and issues reports on the personal information practices of public and private sector organizations.39 In 2009, the Office investigated Facebook’s practices and concluded that Facebook was in violation of Canadian privacy law. The Office identified several areas where Facebook needed to better address privacy issues.40 For example, Facebook collected and used personal information of non-users without their consent.41 Facebook addressed each of the issues identified by the Office in order to become compliant with Canadian privacy law.42
Practical Strategies for Minimizing Risks Associated with UGC
Tips for Website Operators
- Review websites to determine whether UGC is present. Websites that are not typical UGC sites may nevertheless contain UGC that could present legal issues for the website operator.43
- Website terms and conditions should include representations from users that their posted material does not infringe intellectual property rights or contain defamatory material. The terms and conditions should be easily accessible. Passive website terms and conditions should be avoided in favour of click-wrap agreements which require users to scroll through the terms and conditions and click an “accept” button, and which courts are more likely to enforce. 44
- Ensure the website’s privacy policy is easily accessible and is reviewed regularly to reflect recent case law, legislation and rulings of applicable regulators, as well as the website’s actual profile.45 To comply with PIPEDA, consent must be obtained for the collection, use and disclosure of any personal information received from users.
- Obtain adequate rights from UGC providers with respect to their content. Website operators may wish to own the content outright, or instead seek a licence permitting them to use the content, leaving ownership with the UGC provider.
- Establish procedures for dealing with UGC complaints reasonably and expeditiously.46 Provide users with access to site administrators for sending complaints and takedown notices and, when faced with a complaint, act promptly to investigate and remove any infringing content.47
Tips for Posters of UGC
- Carefully review the website’s terms and conditions. Be particularly aware of whether they provide for a transfer of content rights to the website operator.
- Ensure the posted content does not violate any copyright or trade-mark rights or contain any defamatory statements.
- Review the website’s privacy policy, and understand how posted information can be used by the website operator. Obtain consent from all identifiable persons in posted content, including photographs and videos.
Tips for Content Owners
- Devote sufficient resources to monitor UGC websites for possible infringement.48
- Upon discovering potentially infringing activity, carefully review the material and, if appropriate, send a notice requiring it to be removed.49
The proliferation of UGC in recent years has raised traditional legal issues, such as copyright infringement, defamation and violation of privacy rights, in a novel context. Although a number of court decisions provide guidance as to rights and obligations that arise in connection with UGC, both for users who post the content and for website operators on whose sites the content is posted, many of these decisions are under consideration and numerous issues have yet to reach the courts. The next few years will likely provide answers to many legal questions concerning UGC, although new forms of UGC and new ways of using it will evolve and undoubtedly raise new questions.
Jessica Fingerhut is an associate in the Business Law Group at Cassels Brock & Blackwell LLP. She can be reached at jfingerhut@casselsbrock.com or 416 860 6456.
*This article has been adapted from a paper written by Len Glickman and Jessica Fingerhut entitled
“User Generated Content: Recent Developments in Canada and the US”, which was presented by Len
Glickman at the Federated Press’ 4th Internet Law Course in Toronto in December 2010. (“Glickman
and Fingerhut”) The paper elaborates on the issues presented in this article and discusses the legal
implications of user-generated content in a US context. The paper is available at:
www.casselsbrock.com/index.cfm?cm=Menu&ce=details&primaryKey=Resources
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1 Interactive Advertising Bureau, “IAB Platform Status Report: User Generated Content, Social Media, and Advertising - An Overview” (April 2008), online: .
2 Australian Copyright Council, “User-generated content & Web 2.0 websites” Information sheet (March 2008); Lisa T. Oratz, “Legal Issues in Blogging and Other 3 Social Media Marketing” Perkins Coie LLP (June 2008).
3 Robert P. Latham, Carl C. Butzer, and Jeremy T. Brown, “Legal Implications of User-Generated Content: YouTube, MySpace, Facebook” (2008) 20 I.P. & T. L. J. 1., online: (“Latham”).
4 Cory Doctorow, “What do we want copyright to do?” Guardian (23 November 2010), online: .
5 comScore, Press Release, “U.S. Online Video Market Continues Ascent as Americans Watch 33 Billion Videos in December” (5 February 2010), online: Americans_Watch_33_Billion_Videos_in_December>.
6 Jennifer Valentino-DeVries, “Facebook Cross the 500-Million Threshold, ComScore Says.” Wall Street Journal (18 May 2010), online: < http://blogs.wsj.com/digits/2010/05/18/facebook-crosses-the-500-million-threshold-comscore-says/>.
7 Anthony V. Lupo and Sarah L. Bruno, “Coffee Break! The Issues with User-Generated Content and Social Networking” Arent Fox Update, online: .
8 Kathryn L. Ossian, “Legal Issues in Social Marketing” Institute of Continuing Legal Education (2009), online: .
9 The Canadian Copyright Act prohibits the unauthorized reproduction of a copyrighted work and the unauthorized public performance of a copyrighted work. It also prohibits the unauthorized communication of a copyrighted literary, dramatic, musical or artistic work to the public by telecommunication. See Copyright Act, R.S.C. 1985, c. C-42 (“Canadian Copyright Act”)
10 On June 2, 2010, the Canadian government introduced Bill C-32, the Copyright Modernization Act (the “Copyright Bill”) which proposes to amend the Canadian Copyright Act. The Copyright Bill was debated at second reading on November 2, 2010 and a new legislative committee that will review the Copyright Bill has been announced. The Copyright Bill proposes, among other things, an exception from copyright infringement for certain “non-commercial UGC” See new section 29.21.
11 Canadian Copyright Act, supra note 9,ss. 29, 29.1, 29.2. The Copyright Bill proposes to amend section 29 of the Canadian Copyright Act by adding education, parody and satire as purposes that fall under the fair dealing exception.
12 Glenn Kauth, “Push and Pull of Copyright Reform” Canadian Lawyer Magazine (October 2009), online: http://www.canadianlawyermag.com/Push-and-pull-of-copyright-reform.html (“Kauth”).
13 See CCH Canadian Ltd. v. Law Society of Upper Canada, 2004 SCC 339 and Productions Avanti Ciné-Vidéo Inc. v. Favreau, [1999] J.Q. 2725 (Que. C.A.).
14 Canadian Copyright Act supra note 9, s.2.4 (1)(b).
15 Society of Composers, Authors and Music Publishers of Canada v. Canadian Assn. of Internet Providers, [2004] 2 SCR 427, 2004 SCC 45. (“SOCAN”)
16 Ibid. The Copyright Bill proposes to clarify the limits on liability for intermediaries in the digital environment. See new section 31.1.
17 SOCAN, supra note 15.
18 Ibid.
19 See supra note 10.
20 Copyright Bill, supra note 10, new section 41.25.
21 See Glickman and Fingerhut for a discussion on the interpretation and application of the Digital Millennium Copyright Act.
22 Raymond E. Brown, The Law of Defamation in Canada, looseleaf (Toronto: Thomson Canada Limited, 2009) (“Brown”).
23 Brown, Ibid.
24 See Canadian Reform Conservative Alliance v. Western Union Insurance Co. (2001), 2001 CarswellBC 700 (B.C. C.A.) and Newman v. Halstead. 2006 BCSC 65, 146 A.C.W.S. (3d) 153.
25 Crookes v. Wikimedia Foundation Inc. and Jon Newton, 2009 BCCA 392, [2009] BCWLD 7640 (“Crookes v. Newton”). In this case, the defendant did not reproduce or comment on the defamatory material. The plaintiff appealed the decision by the British Columbia Court of Appeal, and the Supreme Court of Canada heard the appeal on December 7, 2010, reserving judgment.
26 Ossian, supra note 8.
27 Communications Decency Act 47 U.S.C. x 230.
28 See Glickman and Fingerhutfor a discussion on the application and interpretation of the CDA.
29 See Glickman and Fingerhutfor a discussion on the decisions and actions in which this issue has been raised.
30 2005 FCA 193.
31 Ibid.
32 Ibid.
33 York University v. Bell Canada Enterprises, (2009) 82 CPC (6th) 352, 99 OR (3d) 695.
34 Ibid.
35 S.C. 2000, c. 5. (“PIPEDA”)
36 Ibid, s.3.
37 Ibid.
38 Ibid.
39 Office of the Privacy Commissioner of Canada (December 2008), online: .
40 Office of the Privacy Commissioner of Canada, News Release, “Facebook needs to improve privacy practices, investigation finds” (16 July 2009), online: < http://www.priv.gc.ca/media/nr-c/2009/nr-c_090716_e.cfm>.
41 Ibid.
42 CBC News, “Facebook privacy changes approved by watchdog” (22 September 2010), online: .
43 Latham, supra, note 3.
44 Ibid.
45 Amy B. Spagnole and Dimitry S. Herman, “Liability evolving for user-generated content” Providence Business News (July 2008), online: .
46 Ibid.
47 Ibid.
48 Latham, supra note 3.
49 Ibid