Toronto Star
Sunday, May 25, 1997

Satellite shake-up -- Public can watch

Judge rules U.S. dishes, `pirate' cards legal

by Robert Brehl,

In the midst of the election, a judge has dished out yet another blow to the government's beleaguered cultural and satellite TV policies.

Mr. Justice John Klebuc of Saskatchewan Queen's Bench has ruled Canadians can legally watch U.S. gray market satellite dishes like DirecTV, despite the government's claims they violate Canadian cultural laws.

In a written decision, Klebuc also said ``black market'' pirate computer cards that allow viewers to hack into DirecTV signals for free are not illegal in Canada because the California-based DirecTV does not operate lawfully in Canada.

``I might just take out a newspaper ad now to sell even more of these cards'', said one dealer, who sells pirate cards for $400.

Klebuc is the highest-ranking judge so far to rule on the contentious issue since the Royal Canadian Mounted Police raided dozens of satellite TV dealers last summer.

``This judge has authority and will be listened to in courts across the country'', said defence lawyer Ian Angus.

But the president of an upstart Canadian satellite service said the judge obviously doesn't understand all the intricacies of intellectual property rights.

``Canadian broadcasters and programmers have spent millions of dollars acquiring the rights to programs'', said Greg Walling, president of Star Choice.

``Black or gray market infringes on their rights, it's as simple as that.''

Klebuc's ruling comes in the case against Saskatchewan satellite TV dealer Ron Ereiser, whose Kerrobert Satellite & Cellular store was raided last year.

The judge said the search was ``excessive'', ``unreasonable'', and in violation of the Canadian Charter of Rights.

Other lower-level judges have also tossed these satellite cases out of court.

The Alberta provincial court tried a dealer, found him guilty, and fined him $24,000, said Cindy Baker, a senior telecommunications policy analyst with Industry Canada.

``It's directly opposite the interpretation of the Saskatchewan court'', Baker said, adding that the Alberta case was in a lower court.

Baker said the government is reviewing its options to determine whether to appeal the Saskatchewan decision.

Angus said this latest decision is important to anyone with a satellite dish or thinking of buying one.

``I interpret this (decision) to mean that he will not allow (government) to interfere with our fundamental rights and one of those rights is to be able to watch the television of our choice'', he said.

In his ruling, Klebuc is tough on DirecTV, a subsidiary of General Motors.

``DirecTV Inc. does participate in a thinly veiled scheme to circumvent the laws of Canada by accepting subscription fees directly from Canadians provided that they maintain a United States address'', Klebuc wrote.

Canadians with gray market dishes use U.S. billing addresses for DirecTV to turn on programming that can be received by their dish and set-top receiver.

DirecTV is not licensed by the Canadian Radio-television and Telecommunications Commission to offer satellite service in Canada.

DirecTV beams in dozens of TV channels that are not authorized for distribution in Canada. It also does not carry the required Canadian programming.

Satellite technology, however, knows no regulatory barriers and signals spill over national boundaries. It is estimated more than 300,000 Canadians now have these U.S. dishes.

The judge muses that DirecTV is in Canada for the money and it knows what it is doing because payments from Canadians often come via credit cards registered with Canadian banks.

DirecTV is motivated to crack down on the pirate cards because they ``impacted on DirecTV's substantial gray market income and were of embarrassment to News Datacom Inc., who encrypted DirecTV's signal'', the judge said.

``Mere production of `pirate' or `gray market' programming signal is insufficient to constitute an offence'', he said.

There is no theft of signals ``unless the telecommunication facility or service in question is authorized by law'', which DirecTV is not, Klebuc said.

Industry Minister John Manley and Heritage Minister Sheila Copps, both out on the election hustings, could not be reached yesterday.

DirecTV's chief legal counsel at the El Segundo, Calif. headquarters was faxed Klebuc's ruling for a response.

The Canadian government has long maintained that protecting Canada's broadcasting industry is paramount to preserving Canadian culture in the face of the American onslaught from south of the border.

Canada's own small-dish satellite industry has been a long time coming to market.

The first company offering a service, Tee-Comm Electronics Inc., of Milton, was pushed into receivership this week.

Two others, Star Choice and ExpressVu, plan to launch services this year.

Copyright © 1997 by All Rights Reserved. Reprinted with permission.