R. v.
Kirkwood
citation(s): (1983) 42 O.R. (2d) 65; 5 C.C.C. (3d) 393, 148 D.L.R. (3d) 323; 73 C.P.R. (2d) 114.
|
R. v.
|
by Donald M Cameron, Aird & Berlis
Dealing in counterfeit or unauthorized copies of computer software may constitute fraud.
In 1980 and 1981, a company operated by Mr. Kirkwood ran several video tape rental outlets in Metropolitan Toronto. Legitimate tapes were displayed in the front of the stores. Counterfeit tapes, bought from various sources, were kept in the back rooms of the stores and duplicated by the staff. Over a five month period in early 1981, Mr. Kirkwood's company made a gross profit of approximately $900 per week by distributing counterfeit video tapes.
Mr. Kirkwood was charged with fraud under s.338(1) of the Canadian Criminal Code.
He was acquitted following a motion for non-suit at trial.
At the Ontario Court of Appeal, the three judge panel unanimously set aside the acquittal and ordered a new trial.
In doing so, the Court held that (at p.117 of the C.P.R. report):
"The respondent [Kirkwood] knew...that by dealing in these counterfeit tapes he was effectively depriving their owners of copyright and distribution revenues which they would otherwise have been likely to earn but for the use of these illegitimate tapes."
The Court reiterated that the two essential elements of fraud (as set out by the Supreme Court of Canada in R. v. Olan, Hudson and Hartnett(10)) are "dishonesty" and "deprivation", the latter element being satisfied by proof of detriment, prejudice or risk of prejudice to the economic interests of the victim. It was held that there need be no personal connection between the fraudsman and his victim (at p.120 of the C.P.R. report):
"I am satisfied that the respondent's willingness to enter into the commercial distribution of the counterfeit video cassettes constitutes evidence from which the trier of fact may infer an awareness on his part of a risk of prejudice to the economic interests of the real owner of distribution rights and copyright. Notwithstanding the absence of a relationship, these owners could be defrauded of the money earned or to be earned by the respondent."
The Court commented on the English case of Rank Film Distributors Ltd. et al v. Video Information Centre et al, [1981] All E.R. 76 (H.L.) where two of the judges stated in passing that infringement of copyright under the U.K. Copyright Act did not appear to constitute theft under s.18 of the U.K. Theft Act, 1968 (U.K.) c.60, indicating (at p.121 of the C.P.R. report) that it knew of no decisions in which "property" as defined in s.2 of the Canadian Criminal Code had been held to include copyright:
"...although physical objects such as books, photostatic copies or cassettes can be stolen."
"Notes"
Return to:
Cameron's IT Law: Home Page; Index
Cameron's Canadian Patent & Trade Secrets Law: Home Page; Index