As the debate over Canada’s copyright reform legislation, Bill C-32,continues to rage before a legislative committee, one of the most frequently heard claims is that tough reforms are needed to counter Canada’s reputation as a “piracy haven”. The presence of several well-known BitTorrent sites, most notably B.C.-based isoHunt, is cited as evidence for Canada’s supposedly lax laws that the industry says leaves it powerless.

When the bill was first introduced last June, the Canadian Recording Industry Association stated that “stronger rules are also needed to rein in Canadian-based peer-to-peer websites, which, according to IFPI,have become ‘a major source of the world’s piracy problem’.”

Politicians have taken note of the concerns. Industry Minister Tony Clement said the new bill will target “wealth destroyers” and Liberal MP Dan McTeague has lamented that “the very existence of an isoHunt in Canada is problematic and is very much the result of what appears to be a legislative holiday for companies and other BitTorrent sites.”

While the notion of a “legislative holiday” appears to be the impetus for some of the provisions on Bill C-32, my weekly technology law column (homepage version, Toronto Star version) notes that what is left unsaid – and thus far unreported – is that 26 of the world’s largest recording companies launched a multi-million dollar lawsuit against isoHunt using existing Canadian copyright law just three weeks before the introduction of the bill [PDF of May 2010 claim, PDF of August 2010 amended claim].

The lawsuit, filed in B.C. courts in May 2010, alleges that isoHunt facilitates copyright infringement on a massive scale. It seeks millions of dollars in damages and an order that the site cease operating. The lawsuit alleges that isoHunt contributes to wide scale copyright infringement and that its activities violate and can be stopped by current Canadian law.

The lawsuit may come as a surprise to politicians and other observers accustomed to hearing that Canada does not have the legal tools to address online infringement, yet that perception has always been more myth than reality. As the isoHunt lawsuit demonstrates, the legal power to combat online infringement has existed within Canadian copyright law for years. It has been the industry’s reluctance to wield those powers â€“ not their absence â€“ that may have allowed infringing websites to call Canada home.

The claims in the isoHunt lawsuit must still be proven in court (as would any case using the new powers contemplated by Bill C-32), but past cases suggest that Canadian law is hardly toothless. In 2008, the recording industry filed a lawsuit against QuebecTorrent, a Quebec-based BitTorrent site. Within months, the Superior Court of Quebec handed down a permanent injunction against the site and it discontinued operation. Soon after, the industry targeted other sites with cease and desist letters, relying on existing law to demand that they stop operating.

Foreign organizations have also successfully used Canadian copyright law to counter alleged online infringement. Last month, the Dutch anti-piracy group BREIN announced that it had quietly shut down dozens of BitTorrent sites by filing copyright violation complaints with the sites’ hosting providers. While BREIN keeps the names of the sites secret, it notes that Canada is one of the countries where it brings legal action.

The reality is that all major countries are home to some BitTorrent sites, including Canada. The question is not whether Canadian law is equipped to deal with these sites â€“ recent history and the latest lawsuit demonstrate that it is â€“ but rather why the industry has opted for a strategy of damaging Canada’s reputation by loudly claiming that it is unable to address online infringement using existing law while it quietly files court documents that suggest that the opposite is true.