The team is joined by GuestKats Mirko Brüß, Rosie Burbidge, Nedim Malovic, Frantzeska Papadopolou, Mathilde Pavis, and Eibhlin Vardy
InternKats: Rose Hughes, Ieva Giedrimaite, and Cecilia Sbrolli
SpecialKats: Verónica Rodríguez Arguijo (TechieKat), Hayleigh Bosher (Book Review Editor), and Tian Lu (Asia Correspondent).

Thursday, 30 June 2011

Speedy ECJ puts the boot into Belgian public lending right

You don't need to be an
Hercule Poirot to
detect that there's a
problem with the
Royal Decree
The Third Chamber of the Court of Justice of the European Union gave judgment today in Case C-271/10 Vereniging van Educatieve en Wetenschappelijke Auteurs (VEWA) v Belgische Staat, a reference for a preliminary ruling from the Belgian Raad van State. Considering that this reference was only made in May last year, a ruling from the ECJ is mighty speedy. Is the Court in training for the Olympics, wonders Merpel.

Perhaps one reason why the ruling came out so quickly is that the question at stake was not so difficult. The Court's decision might even have been made easier by the absence of an Advocate General's Opinion. Anyway, the background to the ruling runs as follows. VEWA, a Belgian copyright management society, brought an action in the Belgian courts to annul the Royal Decree of 25 April 2004 on remuneration rights for the public lending of authors, interpreting or performing artists, phonogram producers and producers of the first fixation of films [that's its full title]. According to VEWA, by fixing a flat rate of remuneration of 1 euro per person per year, Article 4 of the Royal Decree infringed the provisions of Council Directive 92/100/EEC of 19 November 1992 on rental right and lending right and on certain rights related to copyright in the field of intellectual property [another over-long name ...] which require that ‘equitable remuneration’ be paid in respect of a loan or rental.

The court wasn't sure what to do. It noted that Articles 4(1) and 8(2) of Directive 92/100 referred to ‘equitable remuneration’, whereas Article 5(1) simply mentioned ‘remuneration’ and was concerned that, while the ECJ had already interpreted the concept of ‘equitable remuneration’ in Article 8(2) in Case C-245/00 SENA, it had not yet ruled on the concept of ‘remuneration'. It therefore asked for a preliminary ruling on this question:
‘Does Article 5(1) of [Directive 92/100], now Article 6(1) of [Directive [2006/115], …, preclude a national provision which sets the remuneration at a flat rate of [EUR] 1 per adult per year and of [EUR] 0.5 per minor per year?’
In an agreeably short expected and disagreeably inconvenient ruling today, the ECJ held as follows:
"Article 5(1) of Council Directive 92/100 ... precludes legislation, such as that at issue in the main proceedings, which establishes a system under which the remuneration payable to authors in the event of public lending is calculated exclusively according to the number of borrowers registered with public establishments, on the basis of a flat-rate amount fixed per borrower and per year".
So it's up to the Belgian legislature to come up with something less arbitrary, says the IPKat, and a little fairer too. As the ECJ stated:
"40. In the case in the main proceedings, ... the system established by the Royal Decree takes into account the number of borrowers registered with public lending establishments, but not the number of works made available to the public. Such a taking into account does not therefore have sufficient regard for the extent of the harm suffered by authors, or for the principle that those authors must receive remuneration that is equivalent to an adequate income ....

41 Furthermore, Article 4(3) of that decree provides that, where a person is registered with a number of establishments, the remuneration is payable only once in respect of that person. In that connection, VEWA submitted, in the course of the public hearing, that 80% of the establishments in the French Community in Belgium declare that a large number of their readers are also registered with other lending establishments and, consequently, that those readers are not taken into account for payment of the remuneration of the author concerned.

42 In those circumstances, that system may have the result that many establishments are, in effect, almost exempted from the obligation to pay any remuneration. Such a de facto exemption is, however, at variance with Article 5(3) of Directive 92/100, as interpreted by the Court, according to which only a limited number of categories of establishments potentially required to pay remuneration pursuant to Article 5(1) are capable of being exempt from that payment ..".

Two Lords a-leaping!

The IPKat extends his heartiest congratulations to the two Patents Court judges whose elevation to the Court of Appeal for England and Wales has just been announced.  They are:
Sir Kim Martin Jordan Lewison (59, called to the Bar (Lincoln’s Inn) in 1975 and took Silk in 1991. He was appointed as an Assistant Recorder in 1994, as a Recorder in 1997, as a Deputy High Court Judge in 2000, was made a Bencher in 2003 and was appointed as a Member of the Competition Appeal Tribunal in 2004. He was appointed to the High Court (Chancery Division) in 2003 and was a Chancery Supervising Judge between 2007 and 2009. Mr Justice Lewison was Knighted in 2003.
Previous convictions include Confetti Records v Warner (the "shizzle my nizzle" case, in which the learned judge found that rap was a foreign language, and O2 v Hutchinson -- one of the longest trade mark judgments of the pre-Arnold J era ...
Sir David James Tyson Kitchin (56), who was called to the Bar (Gray’s Inn) in 1977 and has been a Bencher since 2003. He took silk in 1994 and was a Deputy High Court Judge from 2001 until his appointment as a Judge of the High Court, Chancery Division, in 2005. He has been Chancery Supervising Judge for the Wales, Western and Midland Circuits since 2009. Mr Justice Kitchin was Knighted in 2005.
Previous convictions include Generics (UK) v Daiichi Pharmaceuticals, for those who love SPC cases, and Twentieth Century Fox v Newzbin, where he made some useful comments about authorising, procuring and other copyright infringement 'assists'.

Merpel wonders who now will fill the empty seats in the Patents Court. Options include (i) the recycling of existing non-IP Chancery judges who are under-utilised or bored with their lot (Lord Justice Lewison is himself a recycled judge, and there have been others), (ii) promoting a senior member of the patent bar who can afford the pay-cut, fancies a change of garb and doesn't mind his every word being scutinised by the blogging community, (iii) opting for an IP litigation solicitor for a change, since there are some impressive examples of this species around at the moment and (iv) not adding to the remaining judges but giving them freer rein in case management conferences and giving them a per-case bonus in addition to their salaries.  A further option is to appoint another couple of judges to the Patents County Court as a statement of intent to shorten the Patents Court list and have far more cases heard at the lower, cheaper level. 

Plane users can't tell airlines from airways, rules court

This wasn't quite what the IPKat
meant about an inside story ...
One reason why patent cases are usually easy to blog about than trade mark cases is that the names of the parties are generally quite different from each other.  Woe to the blogger who gets the parties the wrong way round, as was the danger in United Airlines Inc v United Airways Limited, not yet on BAILII, a decision from last Friday in the High Court (Chancery Division), England and Wales.  If you find the identities of the parties here a little confusing, that's because they are -- as Mr Justice Vos so held.

So what happened here to cause Vos J -- the only judge in the Chancery Division, and one of only two judges in the entire High Court, to possess a three-letter surname -- to reach this conclusion? The story goes like this.  United Airlines is a well-known US airline.  United Airways Bangladesh Limited, to give the company's full name, is a less well-known Bangladeshi airline.  Said United Airlines, United Airways was both passings itself off and infringing its UNITED and UNITED AIRLINES trade marks by employing the abbreviated term UNITED AIRWAYS, in either English or Bengali script, on its seven-aircraft fleet in flights between Dhaka and London from 2009.

Leaving no trade mark stone unturned, United Airlines sought summary judgment and alleged pretty well every kind of infringement known to European man -- same mark/same services; similar mark/same services and a likelihood of confusion and takng unfair advantage of its reputed marks without due cause, thereby diluting them.  No way, said United Airways: the marks didn't look alike; the airlines were different, flew different routes and had different point-of-sale outlets; consumers wouldn't be confused and in any event could do their own research if they wanted to check, and so on.

Vos J granted United Airlines' application for injunctive relief straight off on the basis that there was no way that any defence to the action could succeed.  In his view it was obvious that the parties' respective marks were not truly identical since the bits after the word "United" were different.  However it has to be asked whether, on a global appreciation, the differences were so insignificant that they might go unnoticed by the average consumer, this being a question of fact [how good it is to see that, after over 20 years of harmonised trade mark law in the EU, there are still questions of fact and that this test has not been relentlessly hammered into a question of law]. "AIRLINES" and "AIRWAYS" were not synonymous but, when looked at from the point of view of an average consumer, they effectively conveyed the same meaning. This being so, the average consumer, being unconcerned with corporate identity, would be as likely as not to consider that the Bangladeshi operation was United Airlines' subsidiary. Accordingly, viewed as a whole, the differences between the signs were so insignificant that they would go unnoticed by the average consumer and the two marks therefore sufficiently identical for a same marks/same services action under the Trade Marks Act 1994, s.10(1) to succeed.  Oh, and there was one small issue concerning identity of services too: the fact that airlines fly different routes doesn't make them different services for trade mark purposes.

Regarding the similar marks/identical services claim under s.10(2) of the same Act, evidence of actual confusion was not conclusive, and rarely significant [Not much point in adducing it then? But evidence of lack of actual confusion is equally inconclusive and insignificant ...]. The average consumer was likely to be confused if, lacking intimate knowledge as to the difference between "AIRLINES" from "AIRWAYS", he relied on the imperfect picture he had of the marks and signs in his mind. The same would apply if he reached the Bangladeshi airway's website.

United Airways couldn't say they were merely using their own name when they had picked a name that had been well-established for decades -- particularly since they offered no reason why they should have chosen it.  Its conduct was unfair and was caught by the unfair advantage provisions of s.10(3).

United Airlines' argument based on passing off was also irresistable. Goodwill in the company's marks was established on the evidence, as was the fact that members of the public would believe, on the basis of the similarity, that the Bangladeshi business was connected with the US one. The argument that the public could carry out research and discover that there was no link between the parties must fail [If it succeeded here, we could all kiss goodbye to the tort of passing off, since it would succeed on every occasion].

Funnily enough, after coming across this decision, whom should the IPKat bump into at the AIPPI UK Garden Party yesterday evening but a very sunny Isabel Davies, virtuoso trade mark litigator and now Consultant to Boyes Turner, the firm which acted for the victorious United in this very case. Pressed by the Kat to spill the beans on all the behind-the-scenes information that makes these cases so much fun, Isabel would not be drawn into anything less discreet than the tactful observation that "the judge looked very carefully at the evidence when he came to this conclusion, granting summary judgment. He refused leave to appeal on the basis of his view on the case".  Merpel wonders whether, even if leave had been granted, United Airways might spend its money more beneficially in changing its offending livery.

The Damned United here

Wednesday, 29 June 2011

Compensation for Irish bedroom shenanigans: a matter of Opinion

Determined to avoid making payments
if the ECJ rules against the Irish State,
some hotel owners will make their guests
play phonograms only off the premises
Today saw an all-Irish contest in Luxembourg when Advocate General Trstenjak rendered an Opinion to guide the Court of Justice of the European Union (ECJ) in Case C-162/10 Phonographic Performance (Ireland) Ltd v Ireland and Others, a reference for a preliminary ruling from the Commercial Division of the Irish High Court.  Before getting down to the serious matter of identifying the relevant law and advising the ECJ what they should tell the Irish to be doing with it, the AG treated us to a little scene-setting:
"1. Just as Gutenberg’s invention of the printing press ultimately led to copyright protection of written works [and to copyright infringement, notes Merpel], Edison’s invention of the phonograph not only increased the economic importance of copyright protection of musical works, but also paved the way for the introduction of related rights for performers and phonogram producers. If a phonogram is used, this affects not only the author’s right to the communicated copyright work, but also the related rights of performers and phonogram producers.

2. The present reference for a preliminary ruling from the High Court of Ireland ... concerns the right to equitable remuneration under Article 8(2) of Council Directive 92/100 ... on rental right and lending right and on certain rights related to copyright in the field of intellectual property ... and of Directive 2006/115 ... on rental right and lending right and on certain rights related to copyright in the field of intellectual property ... which must be paid in respect of communication to the public of a phonogram already published for commercial purposes.

3. The referring court wishes to know ... whether such a right also arises where a hotel operator provides televisions and/or radios in guest bedrooms to which it distributes a broadcast signal. The answer to this question depends on whether in such a case the operator uses the phonograms contained in the radio and television broadcasts for communication to the public.

4. Secondly, the referring court asks whether such an operator also uses those phonograms for communication to the public where it does not provide radios or televisions in the bedrooms, but players and the relevant phonograms.

5. Thirdly, the referring court is seeking to ascertain whether a Member State which does not provide for a right to equitable remuneration in such cases may rely on the exception under Article 10(1)(a) of Directive 92/100 and of Directive 2006/115, on the basis of which the Member States may provide for limitations to the right to equitable remuneration in respect of private use.

6. The substance of these questions is closely connected with SGAE [noted by the IPKat here]. In that case, the Court found ... that communication to the public within the meaning of Article 3(1) of Directive 2001/29 ... on the harmonisation of certain aspects of copyright and related rights in the information society exists where a hotel operator distributes a signal by means of television sets provided in its bedrooms, irrespective of the technique used to transmit the signal. It also found that the private nature of hotel rooms does not preclude communication to the public. In the present case, the question arises in particular whether these principles, which concern communication to the public of copyright works under Article 3(1) of Directive 2001/29, can be applied to the notion of communication to the public within the meaning of Article 8(2) of Directive 92/100 and of Directive 2006/115, which concerns the related rights of performers and phonogram producers.

7. ... the present case is closely connected with Case C-135/10 SCF, in which I deliver my Opinion on the same date as in the present case [and which, frustratingly, has not been made available yet in English]. SCF relates ... to whether a dentist who makes radio broadcasts audible to his patients in his practice using a radio provided in his practice must pay equitable remuneration pursuant to Article 8(2) of Directive 92/100 and of Directive 2006/115 because he communicates the phonograms used in the radio programme indirectly to the public".
So what happened in this case? The facts were simple:

" The applicant ... is a licensing body. Its members are phonogram producers who hold related rights in phonograms. The applicant asserts, on behalf of its members, their rights arising from the communication of their phonograms to the public.

40. The defendant in the main proceedings is the Irish State.

41. The applicant in the main proceedings takes the view that the Irish State has not properly transposed Directives 92/100 and 2006/115. Section 97(1) of the Act of 2000 is not compatible with Article 8(2) of Directive 92/100 and of Directive 2006/115 in so far as it provides that there can be no right to equitable remuneration for the communication of phonograms which takes place in the bedrooms of Irish hotels and guesthouses, as part of their service, on radios, televisions and sound systems.

42. The applicant in the main proceedings has brought an action against the Irish State in which it seeks a declaration, first of all, that in adopting section 97(1) of the Act of 2000, the Irish State has failed to fulfil its obligation to transpose Article 8(2) of Directive 92/100 and of Directive 2006/115 and Article 10 EC. Secondly, it seeks compensation for damage which it has suffered as a result."
That's the easy bit.  The issues are clear but the questions have to be converted into something more precise, but sadly far less intelligible:

"(i) Is a hotel operator which provides in guest bedrooms televisions and/or radios to which it distributes a broadcast signal a ‘user’ making a ‘communication to the public’ of a phonogram which may be played in a broadcast for the purposes of Article 8(2) of Directive 2006/115?

(ii) If the answer to paragraph (i) is in the affirmative, does Article 8(2) of Directive 2006/115 oblige Member States to provide a right to payment of equitable remuneration from the hotel operator in addition to equitable remuneration from the broadcaster for the playing of the phonogram?

(iii) If the answer to paragraph (i) is in the affirmative, does Article 10 of Directive 2006/115 permit Member States to exempt hotel operators from the obligation to pay ‘a single equitable remuneration’ on the grounds of ‘private use’ within the meaning of Article 10(1)(a) of Directive 2006/115?

(iv) Is a hotel operator which provides in a guest bedroom apparatus (other than a television or radio) and phonograms in physical or digital form which may be played on or heard from such apparatus a ‘user’ making a ‘communication to the public’ of the phonograms within the meaning of Article 8(2) of Directive 2006/115?

(v) If the answer to paragraph (iv) is in the affirmative, does Article 10 of Directive 2006/115 permit Member States to exempt hotel operators from the obligation to pay ‘a single equitable remuneration’ on the grounds of ‘private use’ within the meaning of Article 10(1)(a) of Directive 2006/115?"
For to make things a little easier for the ECJ, the referring court specified that the proceedings before it did not concern the public areas of hotels and guesthouses, but only hotel and guesthouse bedrooms and that, to the relief of us all, they did not concern any interactive or on-demand transmissions".
The Advocate General advised the ECJ to tell the referring court that

"(1) Article 8(2) of Directive 2006/115 ... and of Council Directive 92/100 ...[means] that a hotel or guesthouse operator which provides televisions and/or radios in bedrooms to which it distributes a broadcast signal uses the phonograms played in the broadcasts for indirect communication to the public.

(2) In such a case, the Member States are required, in transposing Directives 2006/115 and 92/100, to provide for a right to equitable remuneration vis-à-vis the hotel or guesthouse operator even if the radio and television broadcasters have already paid equitable remuneration for the use of the phonograms in their broadcasts.

(3) Article 8(2) of Directive 2006/115 and of Directive 92/100 [mean] that a hotel operator which provides its customers, in their bedrooms, with players for phonograms other than a television or radio and the related phonograms in physical or digital form which may be played on or heard from such apparatus uses those phonograms for communication to the public.

(4) Article 10(1)(a) of Directive 2006/115 and of Directive 92/100 is to be interpreted to the effect that a hotel or a guesthouse operator which uses a phonogram for communication to the public does not make private use of it and an exception to the right to equitable remuneration under Article 8(2) of Directive 2006/115 is not possible even if the use by the customer in his bedroom has private character".
There's a lot to read in this Opinion and this Kat hasn't had time to digest it yet.  One thing that did catch his eye, though, was the sheer breadth of the concept of communication to the public as viewed through the lens of "making accessible" (see extract below, with emphases added). He wonders whether, at the point at which the legislation was drafted, its originators would have assumed that the concept ran so widely:

"164. Recital 27 in the preamble to Directive 2001/29 does not preclude the existence of communication in a case like the present one, however. It must be construed as meaning that persons providing players, without at the same time controlling access to copyright works, do not make any communication to the public. This is the case, for example, where televisions or radios are sold or rented or where an internet service provider merely provides access to the internet. In a case like the present one, however, the hotel operator does not simply provide the players. Instead, it also deliberately provides hotel customers with phonograms, and thus provides hotel customers with direct access to the sounds fixed in the phonograms.

165. It can be stated, in conclusion, that a hotel operator which provides its customers with not only players, but also the relevant phonograms, makes the copyright works embodied in phonograms accessible and makes the phonograms audible, with the result that there is communication to the public both within the meaning of Article 3(1) of Directive 2001/29 and within the meaning of Article 8(2) of Directive 2006/115".
For the record, the Opinion in Case C‑135/10 SCF Consorzio Fonografici contre Marco Del Corso, kindly translated into English by Lord Justice Google and slightly tickled up by the IPKat, goes like this:

"1. Article 8(2) of Council Directive 92/100 ... or Directive 2006/115 ... must be interpreted the sense that a dentist who places a radio in his waiting room and, through it, making a radio show heard by his patients, is required to pay fair compensation for indirect communication public of phonograms used in the radio.

2. On the basis of the criteria of EU law, neither Article 12 of the Convention on the Protection of Performers, Producers of Phonograms and Broadcasting Organizations [Rome 1961] nor Article 15 of the WIPO Performances and Phonograms Treaty, nor Article 14 of [TRIPS] are the provisions of international law that a party may invoke directly as part of a dispute between individuals".

Wednesday whimsies

"ICANN Names Technology Public Policy Expert as its First Vice President of Europe" is the headline that excitedly proclaims the appointment of Thomas Spiller to run the Brussels office of ICANN (the Internet Corporation for Assigned Names and Numbers). Spiller, a French national, will be responsible for "driving ICANN’s strategic objectives in Europe". His previous convictions include time spent advising the French Prime Minister’s Office and later heading up global policy strategy at SAS, one of the world’s largest independent software vendors.

A lawyer by training, Thomas Spiller takes up his new role on 29 August -- a slightly odd date for those of us who remember a time when no professional Frenchman could ever be caught working during the month of August. This Kat suspects that we may hear a great deal of this gentleman over the next year or two, and hopes that he is as good at listening as he is at advising -- otherwise dialogue between brand owners and ICANN is going to be pretty painful [Merpel wonders all the cybersquatters, typosquatters, nuisances and parasites who do so well out of domain name registration: they must have a highly efficient trade organisation, since they so often seem to get what they want ...].

Unrestricted choice -- but
will it lead to meltdown?
Lingering for a moment on the subject of ICANN and the new regime ahead of us for the explosive expansion of top-level domains, the IPKat's poll closed earlier this week and here are the final figures:
  • At last, we have real choice and emancipation of domain names: 7 (4%)
  • It's no big deal. In 10 years time we'll wonder what the fuss was: 97 (57%)
  • It's a recipe for disaster for businesses and consumers alike: 66 (38%)
Please don't write to tell the Kats that 4 + 57 + 38 only add up to 99 -- this is merely the consequence of the polling software rounding figures up or down, as the case may be.

IPSoc never neglects the social side of its programming
IPSoc, the society for junior IP practitioners, is a worthy organisation which anyone who aspires to the enjoyment of good company, the exchange of bright ideas and a taste of things to come in terms of taking responsibility for the IP community in the future should jolly well join.  Be that as it may, IPSoc's next educational event is a talk by Professor Lionel Bently, "Leading UK and ECJ Judgments: Key Developments in Trade Mark Law (including Interflora v M&S)". The date: 25 July 2011; 6pm for 6.30pm, with drinks following promptly at 7.30pm. Venue: the London office of Pinsent Masons LLP.  Sign up here.

"Do we come to bury copyright, or to praise it?"  Last night the number of registrants for the 1709 Blog's Copyright Debate on 12 July, supported by this Kat, reached the amazing total of 200.  There's still room for more. Full details of the programme and registration can be found here.  

Tuesday, 28 June 2011

AVM, Cybits tussle over SurfSitter, GPL

Several (German) news sites (see here, here and here) report on a dispute between AVM Computersysteme Vertiebs GmbH and Cybits AG. AVM, it seems, has been trying to stop Cybits modifying AVM's Linux-based Fritzbox firmware (a DSL terminal). If this Kat has understood the dispute correctly, it appears that Cybits’s SurfSitter DSL filter software downloads AVM-produced Fritzbox software on to a user's computer, modifies the software and afterwards re-installs it on the AVM-produced Fritzbox. SurfSitter is a child protection software program.

What makes this dispute so interesting is that part of the AVM-produced and Cybits-modified software falls under the General Public License (GPL). AVM reportedly bases its claim on copyright, trade mark law as well as unfair competition law and appears to argue, inter alia, that it holds the copyright for the overall product (Gesamtwerk), which in AVM’s own view does not fall within the scope of the GPL.

This dispute dates back to 2010, when AVM had initially obtained an interim injunction to stop distribution of Cybits' software. This case has now moved forward to full trial with Harald Welte having joined Cybits' camp in the proceedings as “intervener” (Streihelfer). Harald Welte is behind and is, according to’s report, also supported by the Free Software Foundation Europe. Welte, who owns the copyright in part of the Linux Kernel, which is included in AVM’s as well as Cybits products, argues that AVM’s effort to prevent third parties like Cybits from distributing modified firmware violates the GPL which allows any third party to modify, recompile, re-install and run modified versions of the respective GPL licensed program (copyleft).

A hearing in this case has now taken place at the Landgericht Berlin on 21 June 2011. For more information on this case, from the view point of the Free Software Foundation Europe, click here. To read Harald Welte’s blogpost summarising with information on this case, click here. Meanwhile, if any of our readers has a link to website that explains AVM's view of the case, can he or she please let the Kat know, so that the links are not too one-sided.

UPDATE: please click here to read AVM's comment on this case (in English). As always, many thanks to readers for their comments. Once the court has handed down a decision, the Kats will of course let you know.

Sponsorship, brand damage and leverage: when there are no winners

The IPKat has often pondered a problem concerning brand sponsorship which arises when the brand, far from being enhanced by its sponsorship of an event, a sports team or indeed anything else, faces damage though its enhanced exposure.  This issue exercised him recently in the context of two of the sponsors of football's World Cup expressing their substantial distress at the allegations of corruption at the highest level of the sport's governing body Fifa -- allegations of which it seemed that everyone except the sponsors was aware (see earlier post here).  The same issue, sadly involving the same sport but a very different set of circumstances, has arisen today, as the Sky report, "Football Club Suspends Sex Offender Player", makes plain.

In short, Scottish Premier League footballer Craig Thomson pleaded guilty earlier this month to charges of "lewd, libidinous and indecent behaviour" towards two under-age girls. Edinburgh-based football club Heart of Midlothian initially said it would stand by the player, saying there was "no reason for Craig Thomson not to continue his career as a professional footballer". But today Hearts issued a statement to the effect that it has suspended him with immediate effect, adding "No further comment will be made by the club."

Calls by charitable and other organisations for Thomson to be dismissed were initially ignored, but it seems that the trigger for the player's suspension may have been the decision of one of its sponsors, MacB Water.  The company expressed disappointment in Hearts' earlier stance and then withdrew its support as official water sponsor, a deal worth more than £5,000.

Says the IPKat, this sort of situation is one in which there can be no real winners.  Criminal offences against under-aged children cannot be tolerated in any civilised society; children deserve protection and those who exploit and violate them deserve their punishment.  Yet Thomson,at 20, is little more than a child himself and has lifetime ahead of him in which his public shame and criminal record is likely to blight the rest of his adult life. He has also in probability lost the chance to pursue the career of his choice.  MacB Water is obviously entitled to take all reasonable steps to protect the integrity of its trading brand, which means that Hearts is left with a hole in its income through no real fault of its own and its sponsor must re-cast its marketing and promotion plans mid-campaign.  Merpel adds, what a pity Thomson didn't opt for adultery.  This apparently does nothing to damage the image of the sponsored brand -- and may even enhance it -- and presumably doesn't affect the exemplary position of the footballer as a role model for today's youth.

How sponsor Tag Heuer profited from Tiger Woods' off-course activities here 
Carlsberg beer's latest deal to use wanderers Wayne Rooney and John Terry here.

Laughing all the way to the Banksy? Graffiti guru opts for tapioca trade mark

Banksy's cat -- or is it a rat? 
Love him or loathe him, the mysterious Banksy is an entertaining and provocative feature of the modern art scene. His highly contemporary, politically pointed and generally well-executed graffiti -- often containing his signature rat -- are a vibrant, satirical contribution to debate and a great way to force us all to confront our own prejudices and cherished beliefs.

Every popular cultural icon -- and Banksy is no exception -- has to face a choice between the following options:
  • cash in on one's output and exploit it commercially;
  • ignore the commercial dimension of one's reputation and output and refuse to be part of the system that creates this commerciality;
  • dabble in the protection and commercialisation of one's name and reputation, but justify it on moral, not commercial, grounds.
Banksy's own position can be seen from the statement on his website:
"You're welcome to download whatever you wish from this site for personal use. However, making your own art or merchandise and passing it off as ‘official’ or authentic Banksy artwork is bad and very wrong.

Banksy neither produces or profits from the sale of greeting cards, mugs or photo canvases of his work. He is not represented by any of the commercial galleries that sell his paintings second hand and cannot be found on facebook/twitter/myspace etc.".
Notwithstanding this, Banksy (who trades under cover of Pest Control Office Limited), has been busily filing for trade mark protection with the UK's Intellectual Property Office (many thanks go to the Kat's friend Edward Smith for spotting this). This company secured, back in 2008, registration of the word BANKSY in no fewer than 20 Classes of goods and services, for, among other things
"Class 03: Cleaning, polishing, scouring and abrasive preparations [Merpel notes how handy these goods can be for, er, removing graffiti];
Class 19: statues and sculptures of stone, concrete or marble [good idea: Banky goes in for sculpture too -- witness The Drinker, parodying Rodin's The Thinker, stolen here]; floor tiles, wall tiles.
Class 20: goods of horn, bone, ivory, whalebone [Ooh, not an animal rights man, is he? Particularly after getting into trouble for elephant abuse], shell, amber, mother-of-pearl, meerschaum and substitutes for all these materials, or of plastics.
Class 29: edible oils and fats [BANKSY edible fats will literally run off the shelves, predicts Merpel].
Class 30: tapioca, sago [one member of the Kat family, having experienced these products in his youth, has always been puzzled as to why they've been classed as foods. In his opinion, this could be one of those rare cases in which the goodwill in the mark is damaged by the badwill in the product to which it is attached -- good luck with this one, Banksy]".
Graffiti men at work here

Monday, 27 June 2011

Monday miscellany

There is no truth in the rumour that
the copyright debaters will ht
wearing togas ...
Registrations for the Big Copyright Debate, which the 1709 Blog is hosting in conjunction with the IPKat, continue to rise. With just over two weeks to go, we are now expecting a remarkable total of 187 people to cheer on our speakers as they endeavour to persuade us to bury copyright or to praise it without actually setting the venue on fire.  If this is the first time you've seen news of this event, it's on Tuesday 12 July at the lovely offices of Freshfields Bruckhaus Deringer. Booking (and other) details, including how to gain access to the venue, are available here.

All these top levels
have the Kat
in a spin!
Those "creative" ICANN gTLDs (eg .merpel) have attracted a lot of attention since their launch was announced last week (for background see comments of the IPKat and Class 46).  They've not attracted much positive response from readers of this blog though.  With just a few hours to go before the end of the IPKat's sidebar poll, just 3% of the 160 votes cast are generally supportive of the widening of top-level domains; 57% consider it to be "no big deal" and that, a decade from now, we'll wonder what all the fuss was about. The balance, a little under 40%, consider the opening up of the internet in this way to be a disaster for businesses and consumers alike.

Europe before surgery
What shape is Europe? We may get a partial response to this question soon, thanks to our friends in Hungary. A media release just issued by the Hungarian Presidency on the Unitary Patent Litigation System states that the 25 Member States that are not Italy and Spain are said to have agreed upon the "shape and form of the future European unitary patent, including its translation regime". Michel Barnier, employing the horse-racing terminology so favoured by hardened gamblers, says "We are now entering the home straight".  He adds: "a unitary patent in Europe could be a reality within the next two years".  Well, yes, says Merpel -- but isn't this one of those statements which would be just as true if you stuck the word "not" into it?  Thanks go to Paul England for being first to spot this.

Artichokes: possibly the only
commercially sold product in which
there might be a market for
a loose-leaf version ...
The IPKat's annual Intellectual Property Publishers' and Editors' Lunch takes place almost every December and it's a great chance for publishers, editors, those who work closely with them and even some conference organisers to get together and speak together on matters of mutual interest.  The 2012 Meeting -- which as usual is free -- is being moved forward to Wednesday 7 December.  Further details will be circulated in the autumn.  Meanwhile, if you have not been invited to this event in the past but feel that you and/or a colleague should be on the list, email Jeremy here and let him know, using the subject line IP PubLunch.  Also, if you either want to be the keynote speaker or want to nominate someone else who might not mind speaking on an aspect of IP publishing and/or editing for not more than 15 minutes, do let Jeremy know. He has a speaker pencilled in for 2012 but his list of 'possibles' is running out.

"No thanks, if I can
get a drop of Champers ..."
Why Vickers like Champagne. At a time when many countries are abandoning their great and noble traditions and culture, sacrificing its quintessential icons on the altar of political correctness if they refuse to die by themselves, the French are jealous guardians of all that is French.  And few words are more evocative of France than Champagne, which is not merely a region but a word that conjures all that is magic about eating, drinking and celebrating without keeping a miserly eye on the bill or a miserable thought for tomorrow's hangover.  It's not easy to use the word 'Champagne' for any purpose without the custodians of the name taking action of one sort or another -- so it's pretty rare to find someone using this word and getting away with it. The Kat's vigilant friend Bob Boad did however spot this WIPO ruling, in which one Steven Vickers prevailed in his dispute with the Comité Interprofessionnel du vin de Champagne over the domain name.

Sunday, 26 June 2011

Nokia v IPCom: if you liked the case, you'll love the conference ...

"At last -- we' ve managed to make
a handset that doesn't infringe
anyone's patents!"
A week and a half ago this weblog posted Matt Fisher's comment on Nokia v IPCom which was subtitled "Round Two of the English Leg of the International Patent Battle". That comment explained the background to the litigation, which it characterised as something of a soap opera.  Given the fact that the dispute is long-running, has a cast of well-known characters, contains all sorts of unexpected twists and turns and exposes the apparently irrational behaviour of players with deeply-held, movingly-articulated positions, the analogy with a soap opera is not unkind.  The main difference between Nokia v IPCom is this, though: the characters in soap operas are  not real people: their often bizarre and chaotic responses to the positions in which they find themselves are scripted and deprive them of any freedom of action. In contrast the players in Nokia v IPCom are real -- and here we are talking of corporate decision-makers, investors and shareholders -- and their interests are real too.

The roots of the dispute go back to 2003, when IPCom acquired a portfolio of mobile telephone patents from Robert Bosch GmbH and Nokia chose not to take a licence to them. Obviously there is a matter of principle on both sides: no normal patent owner chooses to allow a prospective licensee to use patents without a licence, while no business chooses to take a licence to patents when there is no compelling legal reason for it to do so.  Be that as it may, a series of infringement claims and revocation counterclaims ensued and there probably came a point at which each party felt it had invested so much in the dispute that it could not walk away from it even if it might have been cheaper for it to do so. Game theorists are familiar with scenarios such as this.

These musings have been sparked off by the timely appearance (is it coincidence or cunning, the Kat wonders?) of a Butterworths Conference fortuitously titled "International High-Technology Patent Litigation", which is coming up somewhere in London on 27 September. The programme doesn't go in for all that pacifist stuff about technological standards and Fair and Reasonable Non-Discriminatory (FRAND) licences, which have recently featured heavily in Keith Mallinson's trilogy of posts for IP Finance (here, here and here) but cuts to the chase with a full-blooded review of high-tech patent litigation in the UK, Germany, the Netherlands, China and the USA. Ian Purvis QC (11 South Square) is speaking on patent litigation in the UK; his bullet-points, listing Speed, Cost and Procedural Advantages as being among the benefits conferred by suing in the UK.  This would have been truly unthinkable only a few years ago when everyone was still making comments about England and Wales's Rolls Royce court system (for the benefit of younger readers, this meant that the courts were technically very good at achieving justice, but hardly anyone could afford to use them).  Another attraction is a chance to hear Richard Vary Nokia UK's Director of European Litigation and (in this Kat's opinion) as sage and sensible a person as one can ever hope to meet within the wonderful world of IP, talking about his own company's experiences. Too good to miss? If any of the Kat's friends is going to be there, a good report for posting on this weblog will be worth a pint of Badger to its author ...

Full details of the programme for ""International High-Technology Patent Litigation" can be found here.

"You’re So Vain; You Probably Think This Plate is about You"

ImageBY-NC-SA coolmallu 
The IPKat is thrilled to have persuaded his friend and fellow-blogger Aurelia J. Schultz to metamorphose a brief Tweet into a fully-fledged blog post for him to host. It's all about that splendid phenomenon, the customised motor car licence plate.  Writes Aurelia:
"There’s been a whole lot of hullabaloo lately as trade mark owners brace themselves for the onslaught of infringements expected with new top-level-domains.  But it’s not just the information superhighway where trade mark owners need to watch; they might want to take a look around on the paved highway too.
Texas has found a new way to make money.  People, well Americans at least, love to showcase their individuality.  And with over 100 hours a year spent driving, what better place to showcase your individuality than on your very own specially-for-you licence plate?  These licence plates, called vanity plates, usually are available for a small additional fee through the state department of motor vehicles when you register your car.  You submit your first few choices and hope that someone else hasn’t already taken “ILUVTM”.  Texas, however, is doing things a little differently, exploiting the market, and so far that exploitation has brought in some big bucks.  But, should the bucks really go to Texas? 
Texas is auctioning of highly sought after plates.  Rather than a small fee and the hope that you’re first, you can secure the licence plates of dream to showcase your individuality by out-bidding every other individual who wants to identify themselves the exact same way.  The Wall Street Journal highlights some commonly-desired plates, such as single digit numbers and AMERICA.  But the most interesting plates mentioned, fetching $7,500 and $15,000, were not numbers or places.  They were trade marks.  
“FERRARI”, just the word on a licence plate, went for $15,000 in Texas.  “PORSCHE” sold for $7,500.  Both (arguably) well-known trade marks related to cars, one has to wonder if the companies should have some say, or some piece, of what’s going on here.  (One also wonders whether Texas requires that the FERRARI plate only go on a FERRARI.  Perhaps the threat of society laughing at your FERRARI licence plate on a ’72 Pinto takes care of that.) 
It would be hard to find trade mark infringement here since no one is going to confuse a licence plate for a car, or think that a car is a Porsche just because the licence plate says PORSCHE.  And people know that licence plates are produced by the state, usually by the prisons, and not by car companies.  There’s also no unfair competition here as the licence plate is not competing with the actual car.  Dilution would be hard to show since there can be at most 50 licence plates with the TM, maybe 500 if there’s enough room for a digit (Note: the author does not know of any states that allow more than 7 spaces on a licence plate.)
Texas does seem, however, to be unfairly gaining a hefty amount of money thanks to the strengths of these brands.  Shouldn’t they be sharing that large pot?"
Thoughts, anyone?

Friday, 24 June 2011

Sleeping Easy Again - Cephalon v Orchid [2011] EWHC 1591

Emerging, blinking, from the dark confines of the pile of examination scripts that he has called his home for the past few weeks (which in the best cases have been a joy to behold and in the worst a veritable papier-mâché bunker of Babel), this Kat has spent a rather pleasant afternoon easing himself back into the real world again by digesting the latest judgment from Mr Justice Floyd: Cephalon v Orchid & Mylan [2011] EWHC 1591 (Pat).

Cephalon and its subsidiaries owned the rights in three patents: EP(UK) Nos. 0 731 698 (“698”), 0 966 962 (“962”) and 1 088 549 (“549”), all of which contained very similar disclosure and shared a priority date of 6 October 1994. The patents related to the drug modafinil, used to treat sleep disorders such as narcolepsy. Orchid were the manufacturer of generic modafinil which the second defendant (“Mylan”) intended to market in the UK. Cephalon opposed this marketing and so brought an action for infringement. The matter came before Mr Justice Floyd, who handed down his judgment today.

By way of background, modafinil was discovered by Lafon in France in 1976. During the course of clinical trials conducted in the United States some years later, Cephalon noticed that the formulation used by them displayed increased side effects as compared with equivalent doses tested in European clinical trials. They eventually concluded that this was down to the size of the particles making up the input active pharmaceutical ingredient (the “API”) used in the US trials. Essentially, the ease of modafinil’s dissolution within the body was increased by reducing this particle size. Accordingly, a smaller dose of the drug could be used to achieve the same results (and generate the same side effects).

Cephalon therefore applied for the three patents that form the basis of this action: '698 claimed the pharmaceutical compositions themselves; '962, drafted in the so-called “Swiss” form, related to the use of the substance “in altering the somnolent state of a mammal”, which is how this Kat would encourage everyone to refer to things that affect their sleep patterns from now on; and '549 referred to a manufacturing process for the medicament.

Following identification of the skilled addressee and discussion of their common general knowledge, the Judge turned to the issue of construction.

As Floyd J explained:

[36] “The principal issue which divided the parties on the issue of construction is whether the claims were referring to the particle size within the composition (Cephalon’s contention) or whether they were referring to the particle size in the active ingredient used to make the composition (Mylan’s contention).”
Taking the patents one by one, Floyd J noted that the skilled person would approach the ‘698 patent “with the teaching of the patent and the background knowledge … firmly in mind.” Accordingly:
[41] “…[H]e would have seen that the patentee had described his experiments by reference to measurements on the bulk API and that, throughout the specification, the patentee uses measurement on bulk API to explain the observation of different clinical effects observed in clinical trials on tablets of modafinil. This background and context would give rise to a very strong presumption that the patentee was using the language of the claim to mean the particle size of the input API, even though this was not what he had expressly said.”
He continued, noting that:
[44] “The background common general knowledge also points strongly in favour of the conclusion that the patentee must have meant particle size to be measured on the bulk API. Particle size is never measured in the dosage form, and the skilled person would not know how to do so. The skilled person would be pre-disposed to understanding the language of the claims to mean particle size as measured in the bulk API.”
However, he also explained that this conclusion was to be placed against the “considerations of language and purpose” that had been urged by counsel for Cephalon:
[46] “…So far as the language of the claim is concerned, it is true that construed literally, and acontextually, it means the particle size within the dosage form. In relation to purpose, if alerted to the case where the particle size in the dosage form is significantly different from the input API, it is also true that the skilled person would say that the particle size in the composition was what mattered, as that is what the patient will swallow.”
Mr Justice Floyd was not, however, of the opinion that the skilled person would find themselves drawn to this literal construction:
[46] “…The patent is intended to be a practical document addressed to technical people in industry. I have no doubt that to such an addressee the term “composition comprising … modafinil particles, wherein at least about 95%” would be understood as referring to the input API. The matters on which Mylan rely would lead him to reject the alternative meanings as impractical. He would see nothing illogical, or contrary to the purpose of the invention, in the use of the API measurement as a measure of how to achieve the beneficial effects of the patent. So purpose and meaning are aligned: only literalism stands in the way.”
The same was true for ‘962: it was the size of the particle in the API that was important.

Finally, the Judge addressed claim 1 of the '549 patent (at [49]). This was, he said, “not a happy example of claim drafting, particularly given the simplicity of the subject matter”, but nevertheless concluded that “the skilled person would understand that … it is the bulk API which he had to measure, and not that in the formulation.”

The death knell for the infringement action was therefore rung, it being common ground that if Mylan’s construction was the correct one then it was operating outside of the scope of the claims.

All was not at an end however, as Mylan, following the lead of irked alleged infringers everywhere, had counterclaimed for invalidity of the patents that had threatened it. They based their attack primarily on obviousness, but also sought to deploy an insufficiency argument as a squeeze on construction should the need have arisen.

Mylan’s assault on the inventive step of Cephalon’s patents essentially revolved around the question of whether it was obvious to use modafinil particles with reduced particle size (i.e. 95% cumulative particle size <200 μm/median particle size <50-60 μm) to make a modafinil formulation. The Judge considered that in light of the common general knowledge and an entry in a publication called “Drugs of the Future” (identifying modafinil, a method for its manufacture, its dosage range and containing summaries of some clinical trials in human volunteers), it was. He explained that:
[82] “…[Even taking] into account the environment or “milieu” in which the notional formulation project is supposed to be taking place (see e.g. Dyson v Hoover [2001] EWCA Civ 1440; [2002] RPC 22 at [88])…, the evidence did not establish that there was any established mindset that anything which met the target dissolution rate would be good enough. In fact the position was to the contrary…. I have no difficulty in accepting that ethical pharmaceutical companies would be motivated to achieve the best formulation which the application of common general knowledge could provide. Indeed the technical mindset was, in stark contrast to that in Dyson, that improvements in bioavailability could be made by reducing particle size, and that the target dissolution rates did not represent any sort of limit.”
Accordingly, the patents were declared to be invalid.

For the sake of completeness, the Judge also addressed the arguments made in relation to sufficiency, noting that whereas the ‘698 patent survived the attack, the process patent, ‘549, was not so fortunate:
[92] “…On Cephalon’s construction, these claims cover a class of processes in which the particles in the API are outside the claim but the particles in the composition are within it. On this basis the specification of the patent is clearly insufficient. The skilled person would have no way of telling, in the case of this class of processes, whether he was using the invention or not.”
The use claims of ‘962, the Judge noted, would have also failed for the same reason had he not already declared the patent to be obvious.

Friday fantasies

Friday comes round at regular intervals, according to some opinions. But from this weblog's standpoint we seem to hit Friday increasingly often as the pace of life on the IP blogosphere continues to accelerate.  Never mind: take a break from the frenetic pace of life and attend an IP event or two; indulge in a little networking (a synonym for notworking, Merpel wonders) and generally enjoy yourself.  The IPKat's Forthcoming Events page is here.

RIPL makes a ripple.  The fourth and final issue of the tenth volume of the John Marshall Law School's Review of Intellectual Property Law (RIPL) has now been published. You can check out the contents here. For those in pursuit of a happy blend of real law and philosophical speculation, Emir Aly Crowne has penned this intriguing piece on patent-eligibility, Locke and utilitarianism.   Ian Rubenstrunk's analysis of the Stephanie Lenz You-Tube take-down case noted by the IPKat here) and his argument that the courts should reject a narrow interpretation of 17 USC s.512(f) is also worth a read (but that's not to say that the other articles and case notes aren't!)

You can often find very interesting IP articles hidden away in titles that aren't generally known for their in-depth IP coverage, as this Kat has occasionally mentioned. Another classic example of this phenomenon can be found in Sweet & Maxwell's Journal of Business Law (JBL), issue 4, 2011, in which avid readers are treated to "Attempts to Jettison the Intellectual Property Creator Using Corporate Structures and External Administration" by the excellent Mary Wyburn (Senior Lecturer, University of Sydney Business School). This valuable article, which will be of interest and concern to those on both sides of the employer/employee divide, has an Australian flavour which is about as strong as Vegemite, which makes its appearance under the heading 'British Business Law'  little surprising.

Just one year ago, this was an arrestable offence ...
Around the blogs. The IP Finance weblog, noting a recent piece from UNCITRAL's Spiros Bazinas and an update on that organisation's current position on security interests in IP, recalls that it was this very topic which caused the blog -- which now has 929 subscribers -- into existence less than 30 months ago. A year on from the arrest of the Bavaria Babes, Afro-IP's Darren Olivier reflects on anti-ambush marketing laws and wonders whether making ambush marketing an arrestable offence is about as effective as trying to douse a fire with paraffin.  This week's PatLit PCC Page deals with prospects of a patent litigant getting security for costs against a foe who may not have much cash in hand.  Simone Blakeney in Art & Artifice notes the settlement of the Hangover Tattoo copyright dispute, while a current intelligence review by Andrew Clay, hosted on the jiplp weblog, explains the effect that an earlier unappealed OHIM Board of Appeal decision can have upon the General Court's power to review a later decision in respect of the identical trade mark. 

Another day, another consultation -- but this time it's from Ireland. Naoise Gaffney (Tomkins) and barrister Gemma O'Farrell have both sent the IPKat news of the latest consultation paper that has come out of the Irish Department of Jobs, Enterprise & Innovation. Naoise explains: 
It's in response to the recent case [EMI v UPC, here] in which the Irish courts took the view that they were not fully compliant with the Copyright/Infosoc Directive and the Enforcement Directive. While this proposed amendment to the Irish Copyright and Related Rights Act proposes to address this perceived shortcoming, perhaps of greater interest is some of the accompanying commentary from the Department:
"It must be emphasised that this proposed amendment is not about the introduction of a statutory regulatory regime in relation to copyright infringement such as the French “Hadopi” system or the “Three strikes” regime set out in the Digital Economy Act in the United Kingdom.  
In proposing to amend the legislation, the Department is particularly conscious of the importance of online content and digital businesses in the Irish context and, accordingly, is simply seeking to ensure Ireland’s continued compliance with its obligations under the relevant EU Directives following the decision of the High Court in the aforementioned UPC case".
Early call for papers.  The First International Conference on Management of Intellectual Property Rights and Strategy, "MIPS 2012", takes place next  2 to 5 February 2012 and its theme is "IP for Development:: The emerging Paradigm". The venue is the Shailesh J. Mehta School of Management, Indian Institute of Technology Bombay (IITB), India. If you want to give a paper, your first port of call is here.

Intellectual Property Watch is a much-valued service to the IP community worldwide -- but it's not sufficiently valued for people to give it adequate funding.  There's an urgent plea for funding here.  Do please help to keep this precious service going!

Genuine Intention to Use - Practitioners Speak Out

Only a few hours after the AmeriKat posted her article last night (or this morning, depending how accurate one wishes to be) on Mrs Justice Macken's speech at IBIL's Annual Hugh Laddie Lecture, she received a flurry of e-mails commenting on the issue raised by the judge's speech on the issue of genuine intention to use in trade mark law. One of the most interesting e-mails, and most convincing of arguments, she received was from Roland Mallinson of Taylor Wessing (picture, left). With Roland's kind permission, the AmeriKat reproduces his comments below:

"As regards Mrs Justice Macken's answer to my question [see report of lecture and Roland's question here], I can think of some situations where one might consider an application to have been made with no genuine intention to use (or perhaps should give rise to a rebuttable presumption of as much). These include:

  • where an applicant with no history of broad trading (or perhaps not having traded at all) applies in all Nice classes using class headings;
  • where the application is in respect of goods/services for which the applicant previously held a registration but which was just revoked for non-use in respect of those goods/services and possibly even just where the timing of the application is suspiciously close to the date on which an earlier identical unused registration becomes revocable for non-use;
  • where the nature of the mark itself clearly identifies one type of use and yet the specification relates to a totally different use; and
  • where the applicant has applied for precisely the same mark at the USPTO but with a considerably narrower specification (due to the need to show use) - this is more controversial and perhaps should just raise a suspicion that all of the claimed broad use isn't intended in the EU.

Whilst disclosure and cross-examination are the best tools for revealing intent, clearly it is not desirable to make that routine. However, neither would be necessary to prove the above facts if they exist.

I was reminded by my neighbour in the auditorium (thank you Stephen Jones) that, in days of old (Rule 21 under the 1986 Rules) the Trade Mark Registry (as it then was) could raise an office action questioning the genuineness of the intention to use. The applicant was then required to justify the breadth of the goods/services claimed or else face refusal of the application. How about resurrecting that for OHIM? Clearly a supermarket, department store or major industrial conglomeration could well have reason to apply in respect of a vast range of goods/services but that's unlikely for a flower shop or taxi business.

As I mentioned, the UK option potentially arises pre- or post-grant (under s3(6) and s47 TMA - relating to bad faith). Bad faith isn't a ground for pre-grant objection to a CTM (Art 7 and Art 46 CTMR) but it is post-grant (Art 52(1)(b)). Then it's a question of whether having no real intention ever to use amounts to "bad faith". Ignoring what the cases have said on this, it seems reasonable to think it should do. However, perhaps it may be preferable not to attribute the stigma of "bad faith" to this (connotations of fraud etc - which was how the USPTO has been seeing this). A better option would be to make a lack of any bona fide intention to use a standalone ground of objection (akin to s26 of the 1938 TM Act). There could be an initial presumption that a statutorily declared intent is genuine. Case law should fairly quickly establish a suitably low standard of proof to show genuine intent. It would need something more than just a declared wish or ambition, e.g. with some consideration of synergy with existing or core business, opportunity and/or resource. The idea would be to ensure that only the completely unreasonable and deliberate land grabbers are affected. Over broad applications or over zealous attacks could perhaps also face adverse/indemnity costs orders, although this would require removing the fetters of the fixed scale awards for registries."

The AmeriKat sees a lot of merit in Roland's argument that there be an initial statutory presumption of a genuine intent, but if an objection on these ground was raised the proprietor need only show a low standard of proof (preponderance/balance as opposed to a "clear and convincing" in Ameri-speak) of a genuine intention to use the trade mark in order to rebut the objection. (The AmeriKat may just be tired, but the whole concept of rebuttable presumptions and standards of proofs in relation to objecting to registered IP rights, a la i4i v Microsoft, seem to be coming through in this debate).

What do readers think?

Bundesgerichtshof on the "lawfulness of a press report"

The German Federal Supreme Court (Bundesgerichtshof) this week had to decide on the lawfulness of a press report about a book presentation by former news reader, journalist and author Eva Herrman (shown to the left), in particular whether this report was an infringement of Ms Herrman’s general personality right under the German constitution (case reference VI ZR 262/09 of 21 June 2011).

Eva Herrmann used to present the main news show Tagesschau on German television and is a somewhat controversial person with decisive views on various topics. While presenting her book “The Noah’s arc principle - why we have to save the family” (Das Prinzip Arche Noah - warum wir die Familie retten müssen) to journalists in 2007, Ms Herrman elaborated that traditional family values were again needed today, such as those that supported a higher regard for the role of the mother. Unfortunately, these family values had been abolished with the German student movement of 1968. She also referred to the Nazi time and said while most things had been dreadful during and Adolf Hitler had been a “totally crazy and highly dangerous politician”, the regard for families had been one of the very few good things during that time.

For those who are interested in what exactly Ms Herrman had to say, the Bundesgerichtshof’s press release includes a transcript of Ms Herrman’s actual comments as well as the wording of the press report (see here , in German).

The press report in dispute summarised Ms. Herrman’s various musings albeit in an ironic way, inter alia, referring to the fact that she was already married for the fourth time. The report also mentioned her comments on the Third Reich and ended with the words, that "thankfully" the book launch presentation ended after her comments on this topic. Ms Herrman objected to the report. She felt that its tone wrongly alluded that she was a supporter of the Nazi ideology. She further argued that the she was incorrectly quoted, which amounted to an infringement of her general personality right as protected under Articles 1(1) and 2(1) of the German constitution.

The lower courts, the Regional and Higher Regional Courts of Cologne, agreed with Ms. Herrman. The Bundesgerichtshof however agreed with the view of the defendants who had argued that Ms Herrman’s general personality right had not been infringed. In its press release of 21 June 2011 the Bundesgerichtshof clarified that the general personality right not only provides protection against being wrongly quoted (Fehlzitat), but also protects against other incorrect or falsified or distorted representations of statements. More particularly, the court stressed that the general personality right included the right to “one’s own word” and protected the individual from having statements attributed to them which have not made and which may compromise their self-defined claim to social respect (“selbst definierter sozialer Geltungsanspruch”). Upon a review of the press report in question, the court then found that Ms Herrman’s comments and theses had been correctly reflected as regards to the “choice of words, context, the thought process and general purport (Stoßrichtung)”.

The Bundesgerichtshof's press release can be found here (in German).

Merpel thinks that the court got it right and is pleased with this victory for free speech. This Kat however has some sympathy for Ms Herrman. Noone wants to be seen as having views that even remotely resemble those of the Nazi ideology and this Kat can understand why she took the matter to the courts to set the record straight.

Thursday, 23 June 2011

Conference Report: IBIL's Annual Hugh Laddie Lecture

The AmeriKat gets a twinge of nostalgia whenever she walks up Gower Street to UCL, returning to her LL.M alma mater and the scene of her first sturdy paw prints into her career in IP. Perched at the back of the lecture theatre this evening, sandwiched between a counsel and a colleague, she observed the IP glitterati as they shuffled in to this year's IBIL Annual Hugh Laddie Lecture entitled, "Killing the Goose that Laid the Golden Egg: Too Many Trademarks?" - a lecture all about trade mark use (the bane of many a IP practitioner's existence). This year's lecture was given by The Honourable Mrs Justice Fidelma Macken of the Irish Supreme Court, and formerally Ireland's appointee on the European Court of Justice. (picture, left - the AmeriKat during her time at UCL living in the shelf next to one of her many IP text books)

Before Mrs Justice Macken began her speech, there was the matter of introductions - all three of them! Dame Hazel Genn DEB QC, Dean of UCL Faculty of Laws (and an inspiration to this Kat) first welcomed everybody, with Sir Robin Jacob (picture, right) seconding the welcome together with a brief statement of intent now that he finds himself truly "arrived at UCL". Sir Robin stated that he wanted the function of his role at IBIL to be "not an academic IP lawyer or a solely practical IP lawyer, but something in between" with the view that IBIL is to be the institute that the IP world looks to for their views on IP goings-on. Sir Robin stated that when he tried to convince Mrs Justice Macken to speak at this year's lecture, there was really very little convincing to be done; her answer was

"Yes, because of Hugh."
Lord Justice Mummery, the Chairman of the evening's lecture, in introducing Mrs. Justice Macken set out her list of accomplishments and highlights - from her educational background at Trinity College, to her work as a barrister and then as a judge first for the High Court and then as the first woman judge at the European Court of Justice. Before handing over the floor, Mummery LJ, like any good judge and chariman could not help but make some observations about the topic of trade marks:
"Why should such a simple idea of having a sign to indicate the source of goods be so unpredictable?...Why does a subject that is all about preventing confusion be so confusing?"

Mrs Justice Macken (picture, left) in brief response, after thanking Michael Fysh and Valentine Korah (thanks!), stated that the reason that trade mark law is of great interest, annoyance and confusion is probably due to more than just Europe and the Court of Justice for the European Union (CJEU) "sticking their nose in", it is also due to the fact that it probably "pays to have a great deal of problems with IP" from the perspective of all stakeholders = the trade mark proprietors who fight to protect and strengthen their rights, the trade mark users, and of course, us lawyers.

Mrs Justice Macken commenced her speech by acknowledging that "trade marks are the most wonderful things in the world apart from children, grandchildren..." and that it is a great area to work in because, she says, the philosophical reasonings underpinning trade mark law can be traced to logical (sometimes) answers in legislation. But trade marks, despite all of their merits, only function well if they are actually suitable for their job and that they are in fact used. She then regaled the audience of stories of yesteryear that when registering a trade mark in Ireland the most difficult element to prove was not the requirements for registrability but that the applicant had an intention to use the trade mark.

Following a brief recap of the Community Trade Mark (CTM) story, Mrs Justice Macken criticized the Trade Mark Directive and Regulation for lacking a unified rationale and for the lack of clarity on the issue of use/non-use. Even after seven years of these instruments being in force, she said, you would think that there are few legal questions left to resolve - not so. The criticism that was at the focus of Mrs Justice Macken's discussion was Article 15 of Council Regulation 40/94 which states:
"If, within a period of five years following registration, the proprietor has not put the Community trade mark to genuine use in the Community in connection with the goods or services in respect of which it is registered, or if such use has been suspended during an uninterrupted period of five years, the Community trade mark shall be subject to the sanctions provided for in this Regulation, unless there are proper reasons for non-use."
The provision, she argued, does not impose a positive obligation of use on the proprietor despite Recital 9 of the Regulation stating that there really is not much point of having a trade mark without it being used. Recital 9 states:
"Whereas there is no justification for protecting Community trade marks or, as against them, any trade mark which has been registered before them, except where the trade marks are actually used"

Clark & Smyth (Please help the AmeriKat out on referencing if you can!) was cited in support of the argument that Article 15 had no teeth in specifying the sanctions provided for in the regulation for non-use (i.e. Article 9) especially as it does not present a "stumbling block to registration". Mrs Justice Macken also cited an article by Shane Smyth in Intellectual Property who argued that the problem of the use/non-use issue has meant that the trade mark register is crowded with inactive marks. This is as a result of two things: First, that during registration an application can apply a mark for two or three classes of goods for the price of one (bargain!); and second, that the Nice Classification system is so broad that an application can obtain a registration for a full class of goods even though they have no intention to use the mark for a subset of that class of goods. This overly broad and crude classification is especially problematic in priority applications. For example, if the priority mark is from the US the mark is first subject to tighter registration proceedings and more restricted goods/services specifications, but as soon that mark gets to European shores their registrable class suddenly enlarges.

OHIM apparently responds to these concerns by saying that there is no clutter on the register and that every year when some marks are up for renewal, a very large proportion (tens of thousands?) of marks are not renewed either for classes of goods/service or at all. Mrs Justice Macken argued that in an academic world that would be fine, but in the real world it is not attractive to be advising your client that they have to wait 10 years for that mark to come up for renewal before you can grab it. Sure, there are revocation and cancellation proceedings but they are expensive, lengthy and highly uncertain. It was suggested that it is better to advise a client to get their marketing people to find a better mark that is available, then waiting around or bringing proceedings. One would only be sensible to use revocation proceedings to oppose registration or if they are being sued for infringement and are able to use it as a defence.

Mrs Justice Macken then went on to tackle the issues and comments raised in the Max Planck Institute's recent report (see here) on the European trade mark system. When the Trade Mark Directive and Regulation were originally published a joint statement was issued that stated that adequate use of a trade mark would be use of a trade mark in a single member state. Such use would then be sufficient against a non-use attack. The Max Planck report examined whether this was a justifiable approach and whether there was any feeling from concerned parties that the 5 year period for use should be reduced to 2 years. According to the report, a vast majority of practitioners and users wanted to keep the 5 year period, but the lawyers did not - but no reasons were given for this view (Does anyone want to give any thoughts?)

Mrs Justice Macken then briefly turned to the issue currently being raised in the ONEL case (supported by the VP of the Hungarian Patent Office and the Danish IPO). She stated that the reasoning behind this support is that if a trader wants to trade in a small area, like Belgium, under Mark X but has no interest in trading in Slovenia why should a trader in Slovenia who has no interest in trading in Belgium not be able to trade under Mark X? The current Community Trade Mark system does not allow this because there is a very European rationale underpinning this position, i.e., trade mark use is to be considered use for the purposes of the internal market, not merely as use as per each Member State. The joint statement can be interpreted as saying that use in one state "could be" use through out the Community, i.e., it does not necessarily have to be, but such an interpretation although logical, Mrs Justice Macken stated, is not found in the text.

Mrs Justice Macken then closed by touching briefly on the issue of competition law and intellectual property - the necessary evil the AmeriKat feels she needs to start taking seriously in her own education. She stated that with the rise in consumer protection the impact of competition law on IP is more and more intrinsically felt. Mrs Justice Macken stated that in her opinion trade marks, patents and other IP rights, provided they are not abused should not be heavily restricted by competition law because IP rights are a integral part of a functioning market - only if they are abusive should competition law intervene. In closing, she also expressed concern that there is an automatic assumption that if a company is large, has a large IP portfolio they ipso facto are bound to abuse their IP rights; this is a falsity that Mrs. Justice Macken wishes to correct.

The floor was then open for questions. Kate Szell was the first up who echoed, from experience, Mrs Justice Macken's speech. Szell stated that the cluttering of the trade mark register was a significant problem when advising clients to register especially from the "use" perspective. It is rare that a search does not reveal anything of potential concern and as a practitioner one has to advise their client that if they proceed they could be faced with an interim injunction. Szell also stated that it can also be the case that after an internet search a prior mark can seem to be limited for a class of goods, but the risk is of course still there. There is this element of risk due to the "use" problem, but if an overly-cautious approach is taken then new registrations may never occur because clients would be too reluctant to adopt a mark. The general opinion was that this state of the law is massively undesirable.

Steven Jones of Baker & McKenzie clarified for the audience that the 5 year period is from date of registration, so during the application time as much as an additional 2 years can be added to this period. Therefore, during the 5+ year period the mark is "stuck like glue" and there is very little one can do to challenge it. Roland Mallinson of Taylor Wessing stated that under UK law one can attack a mark on the grounds of "bad faith" for non-use or non-intention to use the mark. Under CTM you cannot do this at pre-registration stage and Mallinson questioned whether this could be a way forward. Mrs. Justice Macken stated that she was unsure if this was practically feasible and stated that bad faith arguements can also be a huge expense (quite, says the AmeriKat, someone please define "bad faith" under the Trade Mark Act 1994 because she has yet to find anyone who can).

The most interesting part of the discussion was when a member of the audience (now identified as Richard Ashmead) questioned why there is a lack of transparency regarding the observations that governments are making in respect of the ONEL case and the recent German reference on embryos. We should be able to see what the UK government is saying about these issues and that the secrecy is absurd. Mrs Justice Macken had sympathy with this position and stated that this is something that should be reviewed. This Kat absolutely agrees. How can the UK Government, or any EU Government, expect the people of their countries, including trade mark users, proprietors and practitioners to work under their trade mark law if they do not even know what their Government thinks about such issues? Why should there be such secrecy at all? These are cases that are being referred to the Court of Justice which we will eventually be bound by in some respect. Thoughts?

The Annual Sir Hugh Laddie Lecture was closed by Lord Justice Mummery and the participants ventured across Gower Street for much-deserved drinks and canapés and an evening of further topical trade mark discussions. Mrs Justice Macken's paper will be made available through the IBIL website in due course and this Kat will be greatly interested to get her paws on it for some light summer reading.

The AmeriKat would like to thank the wonderful Lisa Penfold of the UCL Law faculty for getting this Kat into the session after she neglected to register in time.

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