[Term Paper] A Legal ComPLEXity

Introduction

Upon Netflix’s entrance to the market and subsequent dominance, steaming was heralded as the killer of television and movie piracy.[1] Its ease of use, relatively low cost, and wide library of titles led many to believe that pirating content was simply not worth the hassle or risk (of legal action or malware). However, as the streaming space became increasingly diluted with more entrants, the copyright licenses for the content we desire have been spread thin amongst various platforms. Before, one may have only needed Netflix to meet their consumption needs. Now, one may need several subscriptions to access all the content they wish to, thereby increasing consumer costs and reopening a space for piracy to thrive. 

Plex is a streaming platform itself, offering free access to “B-movies” and retro-television programs.[2] However, this is not why Plex teeters on the edge of legality. Instead, it is because Plex provides a service allowing its users to host their own “personal Netflix”. This means users can stream their own media files on demand from “Plex Servers” they create. While Plex is intended for users to access media over which they have the necessary copyright licenses, Plex Servers may be operated to host and stream pirated media. Further complicating this matter is that Plex is not limited to streaming for personal use. Hosts of Plex Servers may share access with friends and family, or even sell access to the public.

Liability of Running a Personal Plex Server with Pirated Content

Reproducing media content through piracy would be an infringement of copyright given such rights are exclusive to the copyright holder.[3] However, Canadian copyright law provides a few exceptions to this general rule. Per section 29.22 of the Copyright Act (the “Act”), it is not an infringement of copyright for an individual to reproduce a work if:

(a) the copy is derived from a non-infringing, legally obtained copy;

(b) the individual owns or is authorized to use the device on which the reproduction is made;

(c) the individual did not circumvent a technological protection measure (“TPM”);

(d) the individual does not give the reproduction away; and

(e) the reproduction is used only for the individual’s private purposes.

Accordingly, an individual who “format shifts” their DVDs into digital files on a Plex server is unlikely to be infringing copyright. The copy would be derived legally and solely for personal use, assuming they did so without circumventing TPMs. However, this assumption is generous given the prevalence of “Digital Rights Management” TPMs on DVDs.[4] Though there is an argument the interoperability exception to circumventing TPMs applies, especially considering such physical media players have gone out of vogue.

However, the way section 29.22 is worded still severely limits its application. For example, an individual would not be covered if they were to download content they already own illegally, as they would be reproducing an infringing copy. However, the courts have yet to interpret section 29.22 of the Act in the context of downloading already-owned media. Given the court’s tendency to respect technological neutrality under copyright law, there may be some leeway for this type of format shifting. After all, like in the ESA case, there is no practical difference between copying via download and copying via physical ripping when one already owns a valid copy.[5]

The other relevant exception would be fair dealing, under section 22 of the Act. For personal viewing, none of the enumerated fair dealing categories are likely to apply. However, for the sake of argument, let’s assume the best-case scenario in which someone has pirated a documentary for the purposes of any of the research, private study, or education categories (despite how doubtful those purposes may be when watching the latest blockbuster slop). Going through the analysis set out in CCH,[6] we must look at the following aspects:

1. Character of the Dealing: In this context, only a single copy would be reproduced, as in CCH.
2. Amount of the Dealing: Here, the entire work would be reproduced unlike as in Alberta (Education)[7] in which the court, in finding fair dealing, focused on the minimal proportion between the copied work and the entire work. Further, the dealing may be gratuitous for the purposes of education. For example, one may only need the narration or certain parts of the documentary to meet the purpose of education, research or private study.
3. Alternatives to the Dealing: There would likely be non-copyrighted equivalents that could be used to achieve the purpose of education, research or private study. For example, one may use free online resources to learn the same information established in the documentary.
4. Nature of the Work: The work is published, weighing in favour of finding the dealing unfair.
5. Effect of the Dealing on the Market for the Work: Finally, the pirated copy would directly compete with the market for the original work, as the individual no longer has an incentive to purchase the original.

As such, even under the best case scenario, it is likely the fair dealing exemption would not apply. With that said, it is also very unlikely for such breaches of copyright to be prosecuted by Canada[8] or copyright holders[9], given that copyright holders cannot demand Internet Service Providers or individuals to reveal the personal information of the user that potentially infringed on copyright. 

Liability Selling (or Sharing) Access to a Pirated Plex Server

If pirating media for one’s own Plex Server is unlikely to be exempt from copyright infringement, then selling (or sharing) access to a pirated Plex Server will certainly not be excluded. Beyond just infringing by reproducing the material, streaming on Plex would fall under the ruling in Rogers[10] which held that individual on-demand streaming of music constitutes a communication to the public.

Additionally, the section 29.22 exemption would be a non-starter as the individual would be giving the reproduction away and the reproduction would not be for the individual’s personal use.[11]

Our fair dealing example outlined above would also fail:

1. Character of the Dealing: Unlike Bell[12], which in finding fair dealing held that streaming does not provide a permanent copy, Plex users may also download media from Plex Servers. This means that there are potentially limitless copies being made, as copies can be duplicated and further disseminated.
2. Amount of Dealing: Same analysis as above.
3. Alternatives to the Dealing: Same analysis as above.
4. Nature of the Work: Same analysis as above.
5. Effect of the Dealing on the Market for the Work: In the context of sharing a Plex Server, this factor would weigh much more towards the dealing being unfair. The Plex Server in this example would be taking away more sales away from the platforms through which copyright holders are paid.

As such, it is quite clear that a person selling (or sharing) their Plex Server would be infringing copyrights and should have to bargain for the requisite licensing fees.

Liability of Plex as an Intermediary

Next, we consider whether Plex, by virtue of providing the services that can lead to widespread copyright infringement, faces any legal risk.

The communication of a copyrighted work to the public is another right that is exclusive to the copyright holder.[13] In this case, Plex is not the person who communicates the work, as they do not upload the work, create the stream, or post the work.[14] Each of these actions is instead done by the user who hosts the Plex Server. Plex, meanwhile, is merely the facilitator in the equation. In fact, Plex does not host any files used by Plex Servers, as all files are stored by the Plex Server host. 

Section 2.4(1)(b) of the Act outlines the Common Carrier Exemption to copyright infringement. This exemption stipulates that those whose only role in the communication of a work is providing the telecommunication means necessary to communicate the work does not communicate the work to the public. While the exemption typically applies to Internet Service Providers, it just as well applies to Plex as a service without which such streaming communications would not occur.[15] 

However, such content intermediaries are not absolutely isolated from liability. For instance, an intermediary loses its exemption when it ceases being a simple conduit and has actual knowledge it is facilitating infringing content. The attributes of a conduit include a lack of actual knowledge of the infringing contents, and the impracticality of monitoring the vast amount of material moving through the internet.[16] The case of Bell Canada[17] exemplifies this. In this case, the plaintiffs established a strong prima facie case of copyright infringement over a company selling set-top boxes that came preloaded with copyright-infringing software. The court held that the Common Carrier Exemption did not apply to the defendant as they went beyond selling a simple means of telecommunication.[18] The defendants instead went as far as promoting their business as a cheaper alternative that avoids copyright licenses and offering tutorials on how to use applications relying on copyright-infringing content.[19] In short, the defendant encouraged and aided potential clients in accessing copyright-infringing content.

Plex’s case differs. Though it does advertise its service with images of copyrighted shows and movies, Plex does not encourage its users to upload or access illegally obtained content. While the instructions for setting up a legal Plex Server are the exact same as setting up a copyright-infringing Plex Server, Plex is not directing, teaching or even encouraging its users to infringe any copyrights. Furthermore, Plex is not a “plug-and-play” method for accessing unauthorized copyrighted content, as users must seek out and add such content themselves, unlike in Bell Canada.[20] Nor is this case like Entral Group International [21], in which the defendant was liable for an authorization infringement for operating and making available a karaoke machine containing illegally reproduced works, as Plex does not provide illegal content to its users. Authorization infringement requires the defendant give approval to, sanction, permit, favour, or encourage the infringing conduct.[22] One cannot say that Plex demonstrably approves or encourages the use of infringing content. Plex is more akin to an Internet Service Provider, in that mere knowledge content-neutral technology may be used to violate copyright is insufficient to constitute authorization.[23]

The case of Plex is more so akin to CCH.[24] In CCH, the courts held that merely providing access to a process, in that case, a photocopier, that has the capacity for copyright infringement is not an authorized infringement. This was especially true as there were signs displayed near the photocopiers outlining their allowed uses. Similarly, Plex’s terms of service[25] explicitly outline that Plex will remove any illegal content that comes to its attention.

However, I personally have a hard time believing that Plex is unaware that its service is commonly used to infringe copyright. Plex itself even has an article on its platform answering the suspiciously common question, “Is Plex illegal?”.[26] Despite the reasonable inference that Plex is aware of the infringing content it is facilitating, Plex has not demonstrated the calculated actions and actual knowledge its users are distributing copyright-infringing content. Just like an Internet Service Provider cannot be held accountable despite it being undeniable people are using its services to pirate, neither can Plex. Plex would have to have actual notice that a Plex Server has posted infringing material on its system and subsequently fail to take remedial action.[27]

The Future

What then is the future for piracy on Plex? Recently, the Federal Court issued an ongoing injunction requiring Internet Service Providers to actively remove access to illegal sports streaming websites in which the copyright holders can prove ownership over the content being displayed.[28] This is an advancement of protections against piracy in Canada, as the copyright owners need not file new applications for each instance of piracy caught.[29] Moving forward, the question is if this ongoing duty will be placed on other “Common Carriers”, like Plex. To this point, I believe that it will be far harder to implement such a requirement when it comes to Plex, as access to specific Plex servers is by invitation only. Therefore, it will be much harder for copyright holders to ascertain which servers are then hosting infringing content. Thus, the only concrete way to protect copyright holders would be a blanket ban on Plex, which I contend is unlikely to manifest as it goes too far. To do so would be tantamount to banning YouTube simply because many instances of copyright infringement exist on the site.

Conclusion

Overall, on its current trajectory, it is unlikely that Plex itself will face any serious copyright consequences for the services it provides. Similarly, its users are unlikely to face any consequences unless a single server grows to such a size as to attract attention. Accordingly, with Plex and media piracy growing in popularity in recent years,[30] streaming giants should be advised to tread carefully lest they be doomed to repeat the fall of cable.

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[1] Alex Hern, “Streaming was supposed to stop piracy. Now it is easier than ever” The Guardian (2 October 2021) https://www.theguardian.com/film/2021/oct/02/streaming-was-supposed-to-stop-piracy-now-it-is-easier-than-ever.

[2] Plex, “Movies & Shows” (accessed 4 December 2024) https://www.plex.tv.

[3]  Copyright Act, RSC 1985, c C-42, at ss 3(1), 27(1) [the Act].

[4] Ganesh T. S., ”Cinavia DRM: How I learned to Stop Worrying and Love Blu-ray’s Self Destruction” (21 March 2012) https://www.anandtech.com/show/5693/cinavia-drm-how-i-learned-to-stop-worrying-and-love-blurays-selfdestruction/2.

[5] Entertainment Software Association v Society of Composers, Authors and Music Publishers of Canada, 2012 SCC 34 at para 5 [ESA].

[6]  CCH Canadian Ltd. V Law Society of Upper Canada, 2004 SCC 13 at para 53 [CCH].

[7] Alberta (Education) v Canadian Copyright Licensing Agency (Access Copyright), 2012 SCC 37 at para 29 [Alberta (Education)].

[8] Dave Morris, “Don’t panic, Canada: Mass piracy lawsuits not likely” The Globe and Mail https://www.theglobeandmail.com/report-on-business/rob-commentary/executive-insight/dont-panic-canada-mass-piracy-lawsuits-not-likely/article17039308/.

[9] Canada, Office of Consumer Affairs, Notice to Canadian Internet subscribers (modified 16 November 2021) https://ised-isde.canada.ca/site/office-consumer-affairs/en/connected-consumer/notices-canadian-internet-subscribers.

[10] Rogers Communications Inc. v Society of Composers, Authors and Music Publishers of Canada, 2012 SCC 35 at para 53 [Rogers].

[11] The Act, supra note 3 at s 29.22(d), (e).

[12] Society of Composers, Authors and Music Publishers of Canada v Bell Canada, 2012 SCC 326 at para 38 [Bell].

[13] The Act, supra note 3 at s 3(1)(f).

[14] Society of Composers, Authors and Music Publishers of Canada v Canadian Assn. of Internet Providers, 2004 SCC 45 at paras 8 and 104 [SOCAN].

[15] SOCAN, supra note 14 at para 92.

[16] Ibid, at para 101.

[17] Bell Canada v 1326030 Ontario Inc (iTVBox.net), 2016 FC 612 [Bell Canada].

[18] Ibid, at para 22

[19] Ibid.

[20] Ibid at para 24.

[21] Entral Group International Inc. et al. v MCUE Enterprises Corp. et al., 2006 FCA 289 [Entral Group International].

[22] SOCAN, supra note 14 at para 127.

[23] Ibid.

[24] CCH, supra note 6 at paras 42-43.

[25] Plex, “Terms of Service” (modified 11 April 2024) https://www.plex.tv/en-ca/about/privacy-legal/plex-terms-of-service/.

[26]Plex, “Is Plex Illegal?” (accessed 4 December 2024) https://support.plex.tv/articles/is-plex-illegal/.

[27] SOCAN, supra note 14 at para 124.

[28] Guillaume Lavoie Ste-Marie, Christopher A. Guaiani, and Nicholas Di Piano, “No parley for pirates: Federal Court (Canada) grants innovative remedy to combat sports piracy” Smart & Biggar https://www.smartbiggar.ca/insights/publication/no-parley-for-pirates-federal-court-canada-grants-innovative-remedy-to-combat-sports-piracy.

[29] Ibid.

[30] PR Newswire, “Plex Closes Year with Billions of Minutes Watched; Doubles YOY Viewership” (4 January 2023) https://www.prnewswire.com/news-releases/plex-closes-year-with-billions-of-minutes-watched-doubles-yoy-viewership-301713824.html; Ernesto Van der Sar, “Canada is a Video Piracy Hotspot While Brazil Sees Piracy in Decline” Torrent Freak (21 January 2024) https://torrentfreak.com/canada-is-a-video-piracy-hotspot-while-brazil-shows-positive-signs-240121/