TORONTO — When is a satellite system illegal?
That is the question vexing Canuck companies and lawmakers where direct-to-home satellite service provider Bell ExpressVu has filed a C$45 million ($28.4 million) lawsuit against almost 30 satellite dealers to stop them from selling systems meant for the U.S. in the Canadian market.
Ironically, the systems actually came from Bell ExpressVu. It offers new customers the chance to trade in illegally held satellite TV equipment as part of its marketing campaign.
In May, ExpressVu sold the traded-in equipment to Continental Components “for scrap value,” per ExpressVu spokesman Ron McInnis, with a provision banning its sale in Canada.
ExpressVu expected the equipment to be sold legitimately through DirecTV in the U.S.
Instead, Continental sold most of it to Toronto-based Incredible Electronics. Incredible Electronics owner David Fuss has told Canadian media that this is not the first time he has bought systems by way of Bell ExpressVu’s program and alleges that Bell ExpressVu is actually assisting the gray market.
That prompted the lawsuit, filed earlier this month.
Fuss, who is now prepping a counterclaim, says he will sell the equipment in Canada until the courts order him to stop.
He is challenging April’s Supreme Court of Canada ruling that banned the gray-market service that he and other companies run. The challenge says the law violates freedom of expression in the Canadian Charter of Rights and Freedoms.
“We’re trying to obey the law,” he says, “but we’re challenging certain aspects of it.”
The Canadian Cable Television Assn. estimates that 700,000 Canadian households are using gray-market dishes, and, according to Serge Corriveau, national director of the Film and Video Security Office, the number is growing.
“The problem is getting larger,” he says. “Just before the Supreme Court decision, we were seeing a lot of ads in the paper regarding satellite piracy. Afterward, most of the ads were gone, but since nothing’s happening on the criminal side they’re coming back because they think that nothing’s going to happen.”