0~-06-1995 15:01 DEPT JUSTICE P.07 COW'ETITION mlBUNAL llltBUNAL DE LA CONCURRENCE
F I l E ... . s D { REGISTRAR • AEGISTRAIRE
OTTAWA, ONT. ~ IN THE MATTER OF an Application by the D r1ctor of lnve1t101uon and R•••rch under 11ct1on1 76, 77 and 79 of the comMtltiM Aq R.S.C. 1985 c. C-M 11 amended. I ~
Between: THE DIRECTOR OF INVESTIGATION AND FtESEARCH --- App II cant ·' TELE-DIRECT (PUILICATION8) INC., TELl-01,.ECT (IERVICl!I) INC. ltlPLY 1. Thia document ia filed '"· reply tc tM Reapon1e d•ted January 23, 1115. 2. Exmpt u ipeCltlclllly mted below, the Applicant ~ti the Reapondent1 1 .ctmllllon1 of material fact and denie1 the other attrnent• of flld fn th• Respon•
1nd join• luue thertwittt
3. The APPiicant llCC9Ptl th9 corpora tact. •• rwMled by the Reapondentl In paragraph 1.
02-06-1995 15:01 DEPT JUSTICE P.08 ' ~,·' - 2 -4. With respect to paragraph 3, the Appllclnt h11 no knowledge of the term• •t by the te1co1 In supplying "raw subscriber listing lnfonn•tlon" gr where title to 1uch information may relide. The Applicant aaya that aueh fecta are not material in th1t suOh "raw aubacrlber information• Is not the product that 11 the tubJ•d matter of this ~I
' Application_ Further, the Applicant denies that the telcos hive thereby aet the "usual trade terms" surrounding the Respondents' provlllon of aublCriber li1ting lnform1tion 11 that term 11 defined in pngr1ph 12 of the Director'• Applle1t1on. The Applieant •Y• ht the Respondents po-• and control tMt eubacrtblr Riling infOrmltiOn and are capable of supplying auch Information in 1 commtrcillly u11ble form (11 defined in paragraph 40 thereof). The Reapondentl ar• therefore the proper parties to the AppliCltion.
6. The Appllc.nt denle• the fact• alleged in paragn1ph1 4 end 5 and uys In l"lply that a... axiatenca af copyright doll not limit the appUcltiOn of MCtion1 75 or 71 of 111 Cpmptlllion Act or thl jUrilClk:tion of the TribuMI over the Intl-competitive prldlcl1 '• 1l'9ged. TM AppUcant ..,. tMt the Respondenta' rafulll to_ eupply IUbscrlber Hating inform1Uon In 1 commerclllly ullbll form 11 not ••n act lf10IOICI In pul'IU9nt aDJl to the exera11 Of any right or tnjoyment Of .,Y lnlnlt dlrtvtd under the copyrtabl Ar:t
within 1.71(5) of h Compttltlpn Aeil. •• eucn '91'Ulll CIOI• not t1ow trom •·m•l"I exel'CiM or enjoyment or IUCh lnttllecaual prvperty righta, even if they e>dat, whicti i• denied.
8. The Applicant denies .the flCla alleged in paragraph• e and 7 and eay1 In reply that th• jur11dlctl0n Of the CRTC over the Respondent•, If any, la limited, that such Jurtldietion, ff it exfltl, h•• not bMn exerciMd to reltrlct the provillon of subacribtr listing Information in any way that would be inconsistent with the relief requelted by th• Applicant Further, the Applcant says that the Competition Tribunal has fUll Junldiction to provide the retllf requested.
7. The Applicant den,_• th• fecta alleged in paragraph 11 and specifically the
02-00-199~ 1~:02 DCPT JUSTICC P.09 - 3 -categorlz1tlon of th• acts of the R1apondents end mancet descrlpUons therein. The Applicant 11y1 that the anti-competitive practic11 relate to two m1r1<ets, publishing ancr advertlllng aarvice1. In reapect of the latter, th• Appllasnt •tat•• that lrre1pectlv• of the legal relatlonahip between the Reapondent1 and Independent 1gencle1, tho" partiea are In competition, both •ctu•I and potenti•I. The Applicant uya that the mere presence of an agency ralationlhlS> between the RelP(V'tdentl 1nd another party (of which the Applicant h11 no knoWledge) does not provide 1ny defence to the appllcatiOn of 1. 79 of.,. Cpmptlltlan Act·
a. The Applielnt ldmltl par1gr11ph11•, 15. 17, and 18 11 IUbltlntillly correct. 9. TM Applleant w no lcnowl•dgtl or l'9 m•...., factl alleged In pa11t9rapha 10. 19, or 20.
10. TM AppHa.nt denies tht flCtl alleged in Pl1'91f1Ph 21 with the exception of the first MntlnOI, whlc:ft It hi• no knowltclgt of. Tht Applielnt •r• that th• R•IPOf1dlntl, not Iha CRTC, hive Ill ..... "ulual trldl tlrm•" for their .... of aublCltw 1111ng Information, b)' ••lnl IUd1 lnformdan hely and In 1 oommerdalf1 uuble form to "'rd pM111 (other thin competing pubhhers) aucn •• telemllrkellng firms Ind pollars. 11. The Applicant clenlea -. fact1 ellqtct in pare9r1ph 22 exotpt the first •ntence. which It admltl. The Applicant refers in raptr to paragraph 5, lbove.
12. Th• Applicant h81 no knOWledge of lhe facts lllegecl In paragraph 23 with the exception of the ftrat sentence, whieh 11 admitted. The Applicant Ny• that even if th• factl In th• remainder r:l the paragraph concemlng the relationshlp between th• telcos and the Respondents are correct, thtM facts have no relevance to tn• current proceeding1.
02-0s-1995 1s:02 DEPT JUSTICE P.10 - 4 -13. With respect to paragraph 24, tt1e Applicant admit• that cert1ln directory revenues of the Respondtntl are considered for regulatory purpoNs e»ut ha• no knoWledge Of wntther thle 11 tN• for ••ch of the Reapondent•. or what portion of revenue• may be ao Included, or the preclM oontractual ralatlonahlp between the telcoa and th• Respondent•.
14. Th• Applicant has no knowledge of the fact• alleged in paragraph 25. 16. The Applicant denies the facts allegtd In paragraph 28 except that the first •ntence Is admitted, to the extent that the "v1lu•" referred to In th1t sentence 11 the -v.tue" to telephone uwa. The AppHClnt apecltlcllly Genill ht 1 directory ~ more v11u1ble to u..,. beMd on the exten th•t the Reaponclentl need not oom.ot Ill The Appllclnt thu1 denie1 tMt the RetpOndMta "mull" maint.ln an lntarnlll •le• force, or Incur llgnltlclnt com Involved In cantKtlng II IUbecrtbel'I. 18. Al • ..,.,., reply to pngreph• 14 to 29, the Appllolnt Nyl thlt while the CRTC requires thlt IUbaatberl receive '"' dirlctOrill publllheel by th• tllephone companlll It regulate•. nol'*'CI In the CRTC regulltory IChlm• or lt1 hlltor1cll origins: (1) requires 1ny particular IQ'out. manner or preeentltlon or methOd of publication of aallltled telephone dlrecitortel; (b) require• •nr particul« m•thod of providing
edvertllin; Ml'Ylcea; (c) r•atrtct• the provlllon of aubae:riber listing information by the Re1pondent1: nor (d) mandates that they conduct their bulin111 by Implementing th8 tying and other •bullvt practice• employed to the dtttlment of competition. consumer choice and etrldency In the publllhlno or ldvertlllno HNicl• m1rk1t1.
17. The Applicant denlt1 paragraph 27, with '" exceptlOn of the flnlt •ntence. The AppliClnt ha1 no knowledge Of the motivation of the entranta delCl'ibeCI in that sentence. With respect to the remainder cf thet paragr•ph the Appllcent aaye that compeUng directory publilhera are driven by the user and 1dvert11er damand that
• t w of t e b dV e e r rt l ll llng • •· The Appllmnt •r• to MtWve comprehenllvanesa.
02-06-1995 15~03 - axi1t1 for 1 more innov1tiv1 1nd inexpensive product.
18. The Applicant denl•• paragraph 28 end aaya th•t thoae Independent directoriee which are comparable to the dlrectorie• of the Reapond•nt• compete In th• aame market•• th• latter.
19. The Appllcent hi• no knowledge of tne contentl of par1graph 29, 1xe1pt that ttMt Appllclnt denie• the lut eentence thereof, eubject to noting that It h11 never sugg•t•d th1t the Respondents compete wtth their "cuatomers", to the extent that term refers t.o advertl•r1. The ~Hcant uy1 In reply that, but for the p111Ctiel1 of the R•IPC)ndenta, all or a subllanUI •ddlllonal poniOn of the .anrt1.an; l9rvloee mmet ooulcl be .nldenlly and ddvelJ wved by oompetlng 1n.,.na.nt ~·· The Appllcent MY• thlt the Re~ have no leglll enlllement to •rbltrarily ehoo .. the portion of the mlfket M wtll beMfll from omnpetltlon v.Mn tlMt lmplemen'81on of IUCh d10ice NIUltl In lctl conRy to I. 75, 77 Ind 71 of the Qpmpdtlpn Apt.
20. The Appllelnt Hrl'lltl thlt -..bpngtaphl 30 (•)to (d) gener•Hy deecrtbe the categories of 8CCOUntl fOt which commiuion ,. pliCt but t.1 no tcno\vlldge of whither tN• 111111 oompr9hen1Ne or ICCUWl9.
21. The Applieillnt t.1 no knowledge of the fllCbl •Aeted In pt1r•graph1 31 to 33, with the exception of th• fir8t""'9nttnce of P•,..;raph 33, which it admits.
22. The Applicant denies th• fact1 elleged in paragraph 35, with the excepUon of th• first sentence thereof, which It 1coapt1, end the 11COnd aent•nce, of whlc:h it h11 no knowledge. The Applicant refers In reply to p1ragraph1 •. 6 and 11, 1bov1.
23. \Mth raapect to paragraph 38, the Applicant 1ccept trte t1te1pondent1' •dml1110n1 but h•• no knowtedge of other it0urcea of eubacrlber Hating lnform•tion In commerci911y uaeeble form ind put• the Reapondenta to the strict proof of th•
DEPT JUSTICE P.11 5 -
02-06-1995 15~0~ ....... ' . exlltenoa of such source•.
24. The Applicant 1coept1 paraar1ph 37 •• aub1t1ntially correct. with the exception of the first sentence In subparagraph 37 (I), th• accuracy of which ll not materl1I.
25. Th• Applicant ha• no knowtedge of the contents Of p1regr1ph 40. 26. The Applleant has no knowledge of the corrtclnlu of the rwenue data llllged in paragrapn 44.
27. Wtn reapect to P*'aoraPh 41CS, an. Appllmnt ,,.. no knowledge of the f.U alleged In the third through lbdh Mnteno11. TM Appllolnt notli• thm the R.,ondentll h9V9 mint.led the dtlftnfflon Of NltiOnal .Advertlling In the Consent Order, which ii MvertlllnO 9PP1Mr'l0 In ttMt bookl of twp Jl rDOl'I Publtlhn. TM ApollClnt lllo 11~1, with retplCt ID lhl 1111 •ltlnCI, thlt h AppHcltlon lnd11d deftne• thl releVlnt martceta (-1 1.g., pa,....ph 9 and PICl•• 17 and 11 ofth1 Application). The mltktt covtrld indudl• bolt NltlcNI AdYltllllng uMotl Md the remlining portion Of the m•rklt for ldvertillng llMcel·not covered by that term.
'•, 28. Thi Applielnt admltl ~· 53 to 511 82 Ind 13. 29. TM Applicant lldmlt1 P41ragraph 80 •xcept In re~ of tM 1Umm1rtution of the CRTC'• ded&ton lhlreln. TM CRTC n1itti1r "held• (it could not) that copyright txi11ed In any of the ·1 nformatlon, nor did It 80Cllpt that copyright applied to l'llW non· cont'identlaJ subscriber II.Ung infonn1ti0n. It merely ltltec:t that copyright •could" . polllbly apply to• directory, wfteth1r In pnntm or electronic fonn. Even If perau1llve, that ob•rvaUon tn no way Hmlt• tht Trtbunal's Junldlctlon over the aublertDer Hating infonnatlon aought here for the re1aon1 Mt out in paragraph 5 abOve.
30. TII• Applicant admits paragreph 81 except In respect of the characterlz1tlon of
DEPT JUSTICE P.12 - 6
02-00-199S 1s:04 "'
... 7 the b11i1 of the 'Nhlte directory complaint. The compl•lnt .-rted, Inter 1111, that the infon"natlon made av1H1ble hid not permitteo vilDle competition In the directory m1r1(et.
31. The Applicant submits that paragraph• 84 to 88 are n•ither retevant to the merits of thl• proceeding nor any Jurlldlctlonal ISIU• raiMd by the Respondents. Subject to this, tht Applk:ant mmitl thou par1graph1 except in respect of the R•apondentl' •ttempt to eummartze tM Director'• polltion in the Reguletqy fcamfWAr:k proceeding, which ii Inaccurate. YJhil• the detlU of 1Uch 1Ubmlulon1 l1 not mmertel, It I• tuffic:IMt to note that the Director recognized the 1xl1tenoe of cwerllp Htween tetecommunteatton1 ....,...., and competltlOn laW and nev.r 1Uggeltecl ....t the CRTC hid eny exdullve jurildidion over the producta that 111'11 the aubJeot matter of thl• Applloatton.
32. The ~t ICmPtl, to the .aent It contai'ta In admllllon, pef'IOrtph 18. but his no knoWlldge of tht IUt •ntence thereof.
33. Thi Appllclnt ldmitl the flcts alleged In par90raph 70, except thl 1111 ...n tencl "'"°'· which II denied. The Applicant MY• the ICClll atrorad T· D PuDI 11 tlllored to eutt ltl pUbHll'Hng nHd1 Ind to that utent the lnfonnauon 11 In • '• cornmwd•llJ UHble form. However, tllHored •oceN le denied competing pubfl8here who have different publllhlnf f'.'Hd•.
34. The Applle1nt denlel paragraph 73 and apeclftcllly that the nature of the 1Ubacr1ber Ulting lnformatlOn IOld by the R•apondenta to YlriOUI third P•rti• dlfflrl munaHy with the nmure of the aubecrlber Hating Information In a oommerclally uuble fonn •• deacrtbed In parqrapha 12 and •o of the Application. 35. The Appllcant 1dmtt1 that, •• ateted In paraQr•ph 7.,., Bell C•n•d• provide• eubeortber Hating Information under 1 tlrtfr, but 11y1 aueh tariff does not make the
DCPT JU8TICC P.13
0~-06-1995 15~05 - B information •v•il•bl• Jn• commercially u11blt fOrm.
36. The Applicant denle1 paragr1phs 77 and 78. 'Mth reapect to the third •ntance in paragraph 77, the Applicant MY• that the fact that the Respondent• have made certain businen C1ec:lllon1 provides no dtfence If thoM dtclllona reeult in th• implementation of practices that are connry to 1. 77 of the Act and thoH practice• cauM 1 aubatlntill le ...n in; of competition. Wth reapect to p1r1graph 78, the Applicant MYI that 1. 77 doll provide for I legll rwtrtdlon aplnlt tied lllllng. Incl that 1 remedy 11 required 1;11nat the ·Respond1nt1 1 prwctiC11 In thl1 respect. Including their arbitrary commialon rul91, which contnbute to eucn tying. Th• Appllcant note•
that unbundling the pnCing of two producta (edvtlrtillng .,.ce •nd eervioe) would lllO Mftr the lie, r the Reepondent. rejeGt the expenelon of th• waHablllty of oommlstlon
•• the .,,....... remedy.
37. Thi AOPllCMt ..... ,.,...., 81 Ind ~ .. bulinell,....... provide any _,.. Jt..llllftcltton for any Of lie Mtl-oompetiUve practlce1 enQaged In, given .. lnli..COlftpdtiYI purpoee Md ... cf IUCh praclicll.
38. Tht Appllcllnt dlniel ~ 82, tXClpt to N extent Nt It hll no knowlldgl Of thl flClUll dltlill Of I'll PtellpOnden\9' Internal operations aa •t out In ' thtl albpilt1191'9ph1 therelO. The Applicant .-y1 th9t tf the Reepondents have dilGOntlnued •ny Of the antt--.npetltivft •ct• within ttvee v••ra from the ftUna Of the Application, •· 71 of tha comQIUHon Act neverthele11 applies by virtue Of lubeection 79(8) thereOf. The Applicant lllY• that ntmedl•• are required In reapect of any di1COnUnu•d 1nt1-competitlve acta beoauae any such.di1COnt1nu1nce h•• been voluntary end may be revel'led by the Re•pondent• anytime In th• 1bunce of an order.
DEPT JUSTICE P.1"1
02-00-199~ 1~:00 - 39. In thla Reply, whtr• "- Applicant haa no knowledge or racta, no 1C1mi111on tnereof 11 m1e1e.
DATED •t Toronto, Ontario. thl1 8th day of February, 1994. Counlll to tftl Dlrlctor of lnve1t1Q1tion lndR1aeard1 TO: The Regtanr Of IW Competition Trtbun81 AND TO: Mr. Ooug R9"1Wtoke 81Nor' VICI P1111dent T....otNct (PUDllcltlonl) Inc. Tlle-DINCt (8ervlcll) Inc. S..-1050 ··, 321 Milner Avenue .. SCltboroUgh. Ontlrlo M18 081
BLAKE, CASSE "' L S & GRAYDON Box :21. Com""*'°9 Court W.et Toronto, Ontario M5L 1AI Attention: Mr. Warren Grover, Q.C. Coun•I for the fltt1P011d1nt1
DCPT JUOTICC P.1:::; 9 -