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Wednesday, 9 January 2008

Late, later, latest JIPLP

On the principle that you always have to wait for royalty to arrive, the Oxford University Press monthly Journal of Intellectual Property Law & Practice must have a pedigree that goes back to the Plantagenets. Now that the British newspapers are heralding the early onset of spring, the December 2007 issue of JIPLP has cautiously poked its nose outside the warmth of the printers premises, sniffing the cold fresh air with a mixture of eager anticipation. The contents of this issue, apart from David Musker's controversial Christmas extravaganza on the Great Free Beer Debate (see the IPKat here), include

* ROCKBASS, LOKTHREAD and EUROPIG, a review of some recent Community trade mark rulings on marginally distinctive word marks by UKIPO's Edward Smith (abstract here);

* Blake R. Bertagna (Arent Fox) writing on the concept of niche fame in the context of the US Trademark Dilution Revision Act 2006;

* An attempt by Amanda Warren-Jones (University of Liverpool) to provide a rational and objective basis upon which an invention for which a patent is sought may be ruled contrary to public order or morality.
View contents of current issue here
Free sample here; subscribe here
50 most read features since JIPLP started here

You can also read the editorial, by IPKat team blogger Jeremy, in full here:

"In the slipstream

The 2007 Formula One motor racing championship finished on a controversial note. The drivers' title was taken by the Ferrari team's Kimi Raikkonen following his victory in the final race in Brazil. Runner up in the drivers' competition by just one point was McLaren's Lewis Hamilton, who finished seventh. It then transpired that cars driven by three drivers who finished ahead of Hamilton had gained the advantage of super-cooled fuel, contrary to Formula One rules. Race stewards confirmed the breach but declined to disqualify the drivers concerned on the ground that such a punishment was too severe. Had it been otherwise, Hamilton would have been world champion.

Right: Lewis Hamilton -- runner up in this year's competition to see who can wear the most sponsors' logos at the same time ...

What has this to do with intellectual property? In terms of law, very little; in terms of principle, a great deal.

The Paris Convention on the Protection of Industrial Property has since the nineteenth century affirmed the place of legal relief against acts of unfair competition as an obligation to be borne by its signatory states. Some countries have made express statutory provision for a general law against unfair competition; others have provided that only specific types of commercial activity shall be regarded as unfair. Others again have made no provision for unfair competition at all, on the basis that their laws on passing off, advertising practices and consumer protection cumulatively offer an adequate degree of comfort to the innocent and injured trader.

The strength of Article 10bis of the Paris Convention is its flexibility. It opens by stating that "any act of competition contrary to honest practices in industrial or commercial matters constitutes an act of unfair competition", then adds a non-exclusive list of activities which it purports to embrace: essentially those which cause confusion, deception or damage to another's reputation. This strength is however also its weakness since it provides no measure by which to ascertain the point at which its requirements have been fulfilled by signatory states.

The term "unfair competition" gives a clue as to the limits of that doctrine's applicability in that the acts that fall within its scope might be expected to be both "unfair" and "competition". If this is so, we can say that an act which is unfair but not does not constitute competition, or which is competitive but not unfair, should be permitted?

It is within this framework that the grand battle between the producers of expensive and somewhat elite brands of perfume and the purveyors of so-called "smell-alikes"cheap, mass-produced scents for downmarket tradehas entered a new phase. Leading international parfumier L'Oréal led the offensive in recent British litigation against Bellure, alleging trade mark infringement, passing off and unfair competition. This action met with some small success in the action for trade mark infringement (though even that satisfaction may be denied L'Oréal once the European Court of Justice has ruled in on the use of its marks in comparison lists), but the action for passing off failed and the unfair competition claim was a non-starter.

The Court of Appeal, asked to find that the absence of a specific unfair competition remedy in English law was a failure to meet an obligation under the Paris Convention, declined to do so.

Even if a tort of unfair competition had existed under English law, it is plain that the court was unconvinced that Bellure would have been in breach of it. While many would consider that company's tacky emulations of leading branded products, characterised in each case by a "wink" towards the brand so emulated, as somewhat distasteful, there was no suggestion that consumers would ever confuse or mistake the leading product for its shadow, or that in any meaningful sense L'Oréal and Bellure could be said to be competing. Giving judgment for the court, Lord Justice Jacob was prepared to recognise that, if the leading brands did not possess their expensively-acquired reputations, there would be nothing for the free-riders to ride on. But the fact of free-riding does not, in and of itself, constitute a legal wrong.

In a way, L'Oréal's position was less strong than that of Lewis Hamilton. He could at least point to a clear infraction of the rules of competition, even if it was not plain whether the loss of the Formula One championship was a material consequence of their breach. Also, one motor racing driver is clearly substitutable for another. Bellure's products were not however substitutes for those of L'Oréal and they were never intended to do more than to coast along in the leading brands' slipstream. The Court of Appeal has recognised that this is so, and there the matter will lie unless the issue becomes the focus of bespoke legislation".

2 comments:

Lorenzo Litta said...

Dear Jeremy,

I carefully read your interesting editorial and I would like to add some comments.

The decision to decline to disqualify the drivers in the Brazilian GP has been "politically" correct.

However, there is no mention in your post of the biggest infringement of the year, one of the most discussed and commented of ever: the "Spy Story McLaren-Ferrari".

This cover-story should be the starting point for each future discussion on unfair competition.

Furthermore I deem that such decisions coming from race stewards it is not an act of "jurisdiction" but only an administrative and political way to 'serve' a decision...

Ciao,
Lorenzo

Patricia Covarrubia said...

The controversial note of last year's Formula One was not much about whether there was unfair competition or not. Moreover, I believe that in fact this case has to do quite a lot with IP since, in the first place, McClaren was guilty for possessing confidential Ferrari materials. Here we see a case of confidential information and trade secret. Because of that the team was kicked out of the constructor' championship. Looking then at this decision, would it have been unfair to allow Hamilton to win the title ? In the end he was driving a car which was 'illegally constructed' ( not only for one race but perhaps for the whole championship)- should the FIA ripped off his points? well, this is surely no IP.

My point is that the whole scandal did in fact involve IP.

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