Executive Summary: Key Legal and Evidentiary Issues

• Corporate authorship presumption under the Copyright Act was deemed inapplicable to ITP SA, requiring direct proof of authorship.

• Lack of affidavit from the alleged image creator resulted in an adverse inference against ITP’s claim.

• Hearsay evidence from ITP executives without firsthand knowledge failed to establish copyright ownership.

• The court found no valid contractual or implied licence allowing CNOOC’s use of the disputed image.

• Arguments concerning time limitations and breach of the implied undertaking rule were dismissed as unfounded.

• Even if infringement were established, the court would have limited remedies to statutory damages, rejecting punitive and broad injunctive relief.

Background and facts of the dispute

ITP SA, a French engineering firm, was previously contracted to provide pipe-in-pipe (PIP) technology to Nexen Inc. (now CNOOC Petroleum North America ULC) for the Kinosis K1A pipeline project in Alberta. Their contractual relationship concluded in early 2015. In 2016, ITP created a stylized cross-sectional image of its PIP system (the “ITP Image”) for marketing purposes, which it posted on its website and used in brochures.

In 2018, after a failure in the original pipeline, CNOOC submitted a presentation to the Alberta Energy Regulator (AER) as part of its application to replace the pipeline. The presentation included an image strikingly similar to the ITP Image, with certain elements—like electrical wiring—removed and the ITP logo blacked out. ITP discovered this use in 2022 through an access-to-information request and filed an application in Federal Court alleging copyright infringement.

CNOOC admitted to using an image resembling the ITP Image but denied wrongdoing. It challenged ITP’s copyright claim, argued the image was used under an implied or contractual licence, and sought dismissal on procedural grounds, including expiry of the statutory limitation period and breach of the implied undertaking rule relating to discovery materials from separate Alberta litigation.

The court’s findings on procedural and substantive issues

Justice Zinn held that neither of the preliminary procedural objections by CNOOC justified dismissing the application. The court ruled that the implied undertaking rule did not apply since the allegedly protected material (the AER presentation) was publicly accessible under Alberta’s access-to-information laws. Furthermore, the application was filed within the three-year limitation period because ITP could not reasonably have discovered the alleged infringement until after December 2020.

Despite clearing the procedural hurdles, ITP’s claim ultimately failed on substantive grounds. The court emphasized that as a corporate entity, ITP could not rely on the statutory presumption of authorship under section 34.1 of the Copyright Act. The onus was on ITP to prove, through admissible evidence, that it owned copyright in the ITP Image. The court found that ITP’s affidavits, provided by senior officers without personal involvement in the image’s creation, constituted hearsay. The alleged creator of the image, Mr. Simon Thiolliere, did not submit an affidavit, and no justification was provided for this absence. The court found this evidentiary gap fatal and drew an adverse inference, holding that ITP failed to prove authorship on a balance of probabilities.

Analysis of CNOOC’s claimed defences

The court rejected CNOOC’s claims of either an express or implied licence to use the ITP Image. The prior contract with ITP’s predecessor, Nexen, was found to cover only deliverables arising from the original pipeline project, and the court found no evidence linking the 2016 marketing image to that contractual scope. Similarly, case law on implied licences was deemed inapplicable, as it only covers reuse of original project deliverables for maintenance or modification—not post-contract promotional materials used in a separate regulatory application.

Outcome and implications

The Federal Court dismissed ITP’s application, awarding costs to CNOOC. Although the judge noted that CNOOC lacked valid authorization to use the image, the application failed due to insufficient evidence of copyright ownership. The decision reinforces the evidentiary burden on corporate claimants in copyright disputes and clarifies that hearsay and indirect testimony are insufficient to prove authorship. It also affirms that licence defences must relate directly to materials created under contract and that post-contractual promotional content does not fall within such scope.