One of the side issues of the fight against Internet Overcharging is the copyright enforcement issue.  Some members of the recording industry believe unlimited broadband promotes piracy and encourages providers to monitor customer activity to enforce copyright law.  Now the recording industry wants a global Anti-Counterfeiting Trade Agreement, part of which could include a three-strikes provision that would force your broadband provider to shut off your service for a year if you’re caught downloading copyrighted material.  The language for the agreement is being worked out, in secret, and you’re not invited to participate.

The recording industry that has hassled broadband users for more than a decade about copyright matters itself now faces a charge of rank hypocrisy as it defends itself against a $6 billion dollar copyright infringement lawsuit. Warner Music Canada, Sony BMG Music Canada, EMI Music Canada, and Universal Music Canada, the four principle members of the Canadian Recording Industry Association, are all named in the suit originally filed in October 2008.

Recording artists charge that for years Canadian record companies have used their works without permission in so-called “compilation” CD’s, containing music from many different popular artists and marketed with titles like “Top Country Music of 2009” or “Your Holiday Favorites 2008.”

Record companies use what the lawsuit describes as “exploit now, pay later if at all” business practices.  It allegedly works like this: a record company needs 12-17 songs to build a new compilation CD.  As the CD is produced, the record company adds the name of the artist and the song to a “pending list” that suggests they’ll sell first, and get the required permission and payment negotiation later.

Unfortunately for artists, that “pending list” is usually a black hole.  That list still contains lists of songs used in the 1980s, and has since grown to more than 300,000 titles.  The creation of the “pending list” loophole has provided a convenient stall tactic for the industry not to pay its artists for using their music.

Details from the court case continue to leak out, including an affidavit from David Basskin, the president and CEO of the Canadian Musical Reproduction Rights Agency Ltd.  Basskin provides a potential explanation for why the “pending list” has gone unattended for decades: “the record labels have devoted insufficient resources for identifying and paying the owners of musical works on the pending lists.”

The existence of the lists could prove to be very expensive to the Canadian recording industry because it openly admits liability to those unpaid artists.  The impacted artists seek damages up to $20,000 per song, which could result in a judgment against the industry for more than $60 billion dollars.

Those are big numbers, but some suggest they are not any bigger than the demands by the music industry for consumers to pay millions in damages for “copyright infringement.”

“After years of claiming Canadian consumers disrespect copyright, the irony of having the recording industry face a massive lawsuit will not be lost on anyone, least of all the artists still waiting to be paid,” said Michael Geist, who holds the Canada Research Chair in Internet and E-commerce Law at the University of Ottawa. “Indeed, they are also seeking punitive damages, arguing ‘the conduct of the defendant record companies is aggravated by their strict and unremitting approach to the enforcement of their copyright interests against consumers.'”