From October 2016 to March 2017 the team is joined by Guest Kats Rosie Burbidge and Eibhlin Vardy, and by InternKats Verónica Rodríguez Arguijo, Tian Lu and Hayleigh Bosher.

Friday, 24 February 2017

Swedish Patent and Market Court of Appeal orders block of The Pirate Bay and Swefilmer

The Pirate Bay blocked in Sweden? Yes, this is indeed what the Swedish Patent and Market Court of Appeal has ordered a major Swedish access provider to do in a recent decision.

Katfriend Nedim Malovic (Sandart & Partners) explains how things went.

Here’s what Nedim writes:

“In a 2016 judgment [commented on IPKat here] the Stockholm District Court (Patent- och Marknadsdomstolen) rejected an application to issue an injunction against a major Swedish internet access provider, Bredbandsbolaget (B2), to block access to torrent site The Pirate Bay and streaming portal Swefilmer.

The rightholders in this case (including, amongst others, Universal Music, Sony Music Entertainment, Warner Music, and Nordisk Film) had brought a joint action in which they claimed that B2 - by supplying internet connection to its own customers (thus enabling access to The Pirate Bay and Swefilmer) - was aiding and abetting (objectively) infringements of their copyrights. 

The Stockholm District Court dismissed the claimants’ action and rejected the request to order B2 to block access to those sites. This was on grounds that it was not possible to determine whether B2 has knowledge of third-party infringements. The first instance court also rejected the claimants’ submission that Swedish law is incompatible with EU law for not allowing blocking injunctions, and ruled out that the decision by the Court of Justice of the European Union (CJEU) in Telekabel [also discussed here] could have any relevance to the present case.

The appeal judgment: in brief

In what can be considered a landmark ruling, on 13 February 2017 the Swedish Patent and Market Court of Appeal (Patent- och Marknadsöverdomstolen) reversed the first instance decision, and ordered B2 to pay SEK 500,000 [approx EUR 53,000] to the rightholders and block access to The Pirate Bay and Swefilmer for the next three years. The decision cannot be appealed and is therefore final.

The court noted that it is indeed possible under EU law for rightsholders to obtain an injunction [pursuant to Article 8(3) of the InfoSoc Directive] against an intermediary whose services are used to commit a copyright infringement, even if the ISP only provides its customers with internet access. 

This also means that there is no need for a contractual requirement, or any other relationship, between the intermediary and the third-party infringer [recently, the CJEU has confirmed this in Mc Fadden, here, and – in the broader context of Article 11 of the Enforcement DirectiveTommy Hilfiger, here].

Will pirates have
a harder time now?
Then the court turned to Article 53 b of the Swedish Copyright Act and said that this provision should be interpreted in light of EU law. The result is that an intermediary, that supplies access to copyright content unlawfully provided by third parties, should be regarded as “participating” in the infringing activity. It follows that it should be possible to issue an injunction against such an intermediary. In contrast with the first instance ruling, the Court of Appeal also stated there is also no need establish an intermediary’s own criminal liability (for aiding and abetting the users’ infringements) for an injunction to be issued against it.

The court then considered whether it was proportionate to issue the injunction in the case at hand. In this regard, it highlighted the importance of striking an appropriate between the fundamental rights to (i) copyright protection; (i) receive/impart information; and (ii) to conduct one’s own business. Because the services of the intermediary were used to make works available without the rightholders’ consent it was considered to be proportionate to issue an injunction.

The reasoning of the Court of Appeal

More specifically, the Court began its analysis by discussing relevant provisions and CJEU case law on Article 8(3) of the InfoSoc Directive (“Member States shall ensure that rightholders are in a position to apply for an injunction against intermediaries whose services are used by a third party to infringe a copyright or related right.”)

The CJEU decision in Telekabel clarified that “an intermediary that provides access to content which third parties’ made available through its services on the internet is an intermediary whose services are used by a third party to infringe copyright or related rights within the meaning of Article 8(3) of the InfoSoc Directive”.

In that case the CJEU also clarified that Article 8(3) of the InfoSoc Directive does not set out a requirement for there to be a special circumstance, such as a contractual relationship between the intermediary and the third party, or that it must be shown that third parties are taking part in unlawful activity using the services of the intermediary. 

Furthermore, the CJEU in Tommy Hilfigher held that there is an obligation for Member States to ensure that intermediaries whose services are used by third parties to infringe IPRs, irrespective of the intermediaries’ own potential responsibility for the activity at issue, may be forced to take measures to the ensure that the infringements stop and also take measures to prevent new infringements. 

Celebratory fika time
for Swedish rightholders
…. What about the safe harbour provisions?

Articles 12-14 in the E-commerce Directive set out exemptions from liability (safe harbours) in favour of mere conduit, caching and hosting providers. Article 12(3) provides however that the safe harbour should not affect the possibility for a court or administrative authority, in accordance with the Member States legal systems, to require a certain provider to terminate or prevent an infringement. 

This reading has been recently confirmed by the CJEU in Mc Fadden (para 79).

Hence EU law…

… intends to provider rightsholders with a high level of protection, also by enabling national courts to issue injunctions against intermediaries whose services are used by third parties to commit infringements. In this regard the court emphasized that Recital 59 in the preamble to the InfoSoc Directive provides that “[t]he conditions and modalities relating to injunctions should be left to the national law of the Member States”.

The Court thus turned to Article 53 b (first sentence thereof) of the Swedish Copyright Act. This provisions states that “[u]pon a petition by the author or his or her successor in title or by a party that, on the basis of a license, has the right to exploit the work, [a] Court may issue an injunction prohibiting, on penalty of a fine, a party that commits, or contributes to, an act constituting an infringement or a violation referred to in Article 53 to continue that act.”

The Marleasing principle and the Swedish Copyright Act

When implementing the InfoSoc Directive into the Swedish legal system, the Swedish Government decided not to use the same language of Article 8(3), but rather phrase Article 53 b in the sense of allowing an injunction to be granted against those who commit copyright infringements and those who aid and abet such infringements. However, as opposed to what the first instance court thought, this national provision must be interpreted in light of EU law (Marleasing principle) and there is no requirement for the claimant to demonstrate that the defendant did so through action or other active conduct. The court said that this conclusion was confirmed by both the preparatory works to Article 53 b and the InfoSoc Directive.

In conclusion the court found that Article 8(3) of the InfoSoc Directive requires that an internet intermediary such as an access provider may be subject to an order to block access to The Pirate Bay and Swefilmer. The requirement of proving a certain relationship between the intermediary and the infringing third party should be considered incorrect/obsolete. The court also ruled out that rightholders would need to prove that the intermediary’s customers have accessed the works (a condition stated instead by the first instance court).

The injunction enters into force on 28 February and will be in place for three years. The decision may not be appealed since the Patent and Market Appeal Court is in principle the last instance court in IP cases."

The Enforcement Directive permits punitive damages - or does it?

The common reading of the ECJ's (yes) recent judgment in case C-367/15 - OTK is that the Enforcement Directive (Directive 2004/48) does not compel Member States to introduce punitive damages for infringement of intellectual property rights, but allows for national law to impose punitive damages (see, e.g., the case reports on IPKat or Kluwer Patent Blog).

But a closer reading of the decision casts some doubt on this common understanding. In the answer to the question (for the background of the case see the IPKat post), the ECJ states "Article 13 of Directive 2004/48/EC ... must be interpreted as not precluding national legislation ... under which the holder of an intellectual property right that has been infringed may demand from the person who has infringed that right either compensation for the damage that he has suffered ... or, without him having to prove the actual loss, payment of a sum corresponding to twice the appropriate fee which would have been due if permission had been given for the work concerned to be used."

In the grounds for the decision, the Court further elaborates (paras. 29-31, emphasis added):

In addition, without there being any need to rule on whether or not the introduction of ‘punitive’ damages would be contrary to Article 13 of Directive 2004/48, it is not evident that the provision applicable in the main proceedings entails an obligation to pay such damages.
Thus, it should be pointed out that, where an intellectual property right has been infringed, mere payment of the hypothetical royalty is not capable of guaranteeing compensation in respect of all the loss actually suffered, given that payment of that royalty would not, in itself, ensure reimbursement of any costs — referred to in recital 26 of Directive 2004/48 — that are linked to researching and identifying possible acts of infringement, compensation for possible moral prejudice (...) or payment of interest on the sums due. Indeed, OTK confirmed at the hearing that payment of twice the amount of the hypothetical royalty is equivalent in practice to compensation of an amount remaining below what the holder would be able to claim on the basis of ‘general principles’, within the meaning of Article 79(1)(3)(a) of the UPAPP.
It is admittedly possible that, in exceptional cases, payment for a loss calculated on the basis of twice the amount of the hypothetical royalty will exceed the loss actually suffered so clearly and substantially that a claim to that effect could constitute an abuse of rights, prohibited by Article 3(2) of Directive 2004/48. It is apparent, however, from the Polish Government’s observations at the hearing that, under the legislation applicable in the main proceedings, a Polish court would not be bound in such a situation by the claim of the holder of the infringed right.

From the first sentence emphasized in the passages cited above it becomes clear that the Court of Justice explicitly  did not address the issue of whether Article 13 of the Enforcement Directive prohibits punitive damages, because according to the Court, the amount payable in the present dispute does not amount to punitive damages.
Looking closely

The second emphasized sentence makes clear that a "compensation" that substantially exceeds actual damages suffered may constitute an abuse of right. This sounds harmless enough - but to assess whether the hypothetical (double) royalty exceeds the actual loss suffered, the actual loss needs to be calculated, and that is exactly what provisions setting a hypothetical royalty want to do away with, because it is difficult and costly. It also raises the question of burden of proof - generally, the burden of proof for losses suffered lies with the party claiming compensation (typically the rightsholder). Where the law provides for a double royalty payable irrespective of actual loss suffered, the burden of proof that the double royalty "substantially exceeds" the actual loss is however an exception that needs to be proven by the party invoking the exception, i.e. the infringer.

In sum, the judgment in C-367/15 - OTK leaves room for debate whether the statutory damages due in a specific case are permitted under the Enforcement Directive, and it specifically does not address whether "punitive" damages are permitted under the Enforcement Directive.

For the pointer I thank Guido Kucsko, Vienna.

Thursday, 23 February 2017

Trader keeps the [good] faith in a spare part in trademark doublebill

Disputes involving the IP rights of spare parts dealers have challenged courts and registries for decades. An interesting instance with respect to the use and rightful proprietorship of a registered trademark occurred recently in Singapore in the case of AUDI AG v Lim Ching Kwang. Kat Friend Kevin Wong, of Ella Cheong LLC has kindly shared his thoughts on this case.

"In the Intellectual Property Office of Singapore case of AUDI AG v Lim Ching Kwang [2017] SGIPOS 2, German car maker AUDI AG applied on 31 March 2015 to revoke and declare invalid Registration No. T0911230B for a stylised trade mark “AOne”, in the name of Lim Ching Kwang, a spare parts trader. The mark is registered in respect of Classes 7 and 12, of which the proceedings involved only the latter class. The grounds for revocation and invalidation are respectively Section 22(1)(a) and (b), and Section 23(1) read with Section 7(6), of the Trade Marks Act (TMA).

Revocation--In respect of the revocation application, the Registrar had to decide whether the mark has been put to genuine use in relation to the Class 12 goods it covers during the period of non-use alleged by AUDI. Taking into account all the relevant circumstances and the evidence tendered by Lim, including emails, quotations, purchase and delivery orders, invoices, and pictures of packaging boxes labelled with the mark, the Registrar found that Lim has made genuine and not mere token, colourable or internal use of the mark in relation to torque rod bushes during the relevant period.

The Registrar disagreed with AUDI’s argument that an instance of Lim’s use of “AOne” in plain font in an e-mail quotation does not constitute use of the stylised “AOne” mark as registered, stressing that the adduced items of evidence must be considered in totality. The Registrar was also sufficiently convinced that, on the balance of probabilities, another instance of Lim’s sale of torque bushes to a local company involved use of the mark as labelling on box packaging for the goods. This is even though the fact that “AOne” brand label stickers were shipped to Singapore together with torque bushes, when looked at in isolation, does not show that such use materialised. As noted, the evidence must be considered in totality.

Nevertheless, as Lim failed to show use of the mark in respect of all the Class 12 goods covered by his registration, the Registrar proceeded to decide that the limitation of the specification to “torque rod bushes” would be fair for the use made. AUDI therefore partially succeeded in revoking Lim’s registration with effect from 19 January 2015, save for this lone item.

Invalidation--As for the invalidation action, the Registrar had to decide whether the mark was applied for in bad faith. AUDI’s case was that Lim’s specification is overwhelmingly broad in reproducing the entire list of Class 12 goods in the Alphabetical List of the Nice Classification, and clearly it cannot be a realistic or bona fide intention to use the mark for all the goods. To support this, AUDI further relied on the modest scale of Lim’s business, judging from its paid-up capital.

The Registrar held that it is baseless to conclude that a specification is too broad merely because it encompasses all the goods in the Alphabetical List of the class concerned. Neither is paid-up capital a reliable indication of the present and future trading capacity of a business. Furthermore, it is legitimate and not prohibited by law to seek registration encompassing present as well as intended future uses of a mark, and applying for a specification wider than current trading scope does not impute a departure from established principles of ethical conduct or honesty in commercial dealings.

Although the mere length or breadth of a specification is no basis for a conclusion of bad faith, the Registrar further held that a lack of intention (at the time of filing) to use a mark for all the goods claimed can constitute bad faith, given that the form of application for registering a mark incorporates a declaration of actual or bona fide intention to use. Given Lim’s legitimate spare parts business and market expansion intentions, coupled with the lack of evidence of unconscionable conduct or moral impropriety on Lim’s part, the Registrar decided that the high standard of proof for a bad faith claim has not been met. AUDI therefore failed in this invalidation action.

This case illustrates how non-use of a trade mark can attract loss of registration rights. It also reflects the burden of proof associated with bad faith allegations, and warns that broad specifications may be scrutinised for bad faith allegations."

Never Too Late: If you missed the IPKat last week!

Been away and want to catch up on last week's IP news? No problem! As always, the IPKat is here to bring you a quick summary -- the 135th edition of Never Too Late. 

Playing Polo with potential defendants 
Rosie Burbidge brings readers a Polo story: the longstanding dispute between the Beverly Hills Polo Club’s UK licensee (Lifestyle) and its increasing defendants that concerns infringement of EU and UK trade marks and procuring breach of a licence agreement. 
Rosie Burbidge also explains the trade mark filing spree/battle between Kylie Minogue and Kylie Jenner about the KYLIE mark. 

Neil Wilkof invites Kat friend Professor Shamnad Basheer, a noted figure in the Indian IP community, to report on the story of the Indian organization – “Increasing Diversity by Increasing Access to Legal Education (IDIA)” that was founded by him. 

Too big to pay? Employee-inventor compensation in the Court of Appeal
Eibhlin Vardy recaps the Court of Appeal’s answer to the question of “Can an employer be 'too big to pay' employee-inventor compensation under s40(1) of the Patents Act?” – the court has provided guidance on the relevance of this issue to the question of “outstanding benefit” in the long running dispute of Shanks v Unilever PLC and others [2017] EWCA Civ 2

Willow Tea Rooms: A tale of tea and trade marks (Part 2)
InternKat Hayleigh Bosher hosts a tea party continues her analysis (see Part 1 here) regarding Ms Mulhern, owner of the mark The Willow Tea Rooms opposing the Willow Tea Rooms Trust attempt to register the mark “The Willow Tea Rooms” in classes 35, 41, 42 and 43. 

No more counterfeiters.

BREAKING: AG Szpunar advises CJEU to rule that The Pirate Bay makes acts of communication to the public
Eleonora Rosati speaks on the AG Szpunar’s “extremely interesting” opinion advising the CJEU to answer the question of the Dutch Supreme Court regarding the Stichting Brein, C-610/15 case in the AFFIRMATIVE.

No more counterfeiters! Chanel, Apple, Bayer, LVMH (and more) write to President Juncker on revision to IP Enforcement Directive
Last week, a group of around 80 of the world’s best known consumer brands wrote to the President of the European Commission calling for action in tackling counterfeiters. Annsley Merelle Ward brings Catriona MacLeod’s report on the key points that merit attention. 

Is German SEP litigation set to increase with the "confidentiality club decision"​ of the Higher Regional Court of Düsseldorf?
“Can you just agree the confidentiality club regime with the other side?” -- the popular AmeriKat this time invites Kat friend Christopher Weber (Kather Augenstein) to explain the recent ground-breaking decision from Düsseldorf which is set to make litigating standard essential patents (SEP) in Germany a whole lot easier. 

After Sweden and Germany, GS Media finds its application in the Czech RepublicAfter Sweden [here, here, and here] and Germany [here and here], it is now the turn of a Czech court [here] to apply the seminal decision of the Court of Justice of the European Union in GS Media [for a quick, visual summary see here; Kat-coverage here] -- Eleonora Rosati brings Katfriend Juraj Vivoda (Marek & Partners) to readers to explain the quite “interesting” result in Czech court. 

Photo courtesy of Ms. Ana Bárbara. 


Never Too Late 134 [week ending on Sunday 5 February] | King Tut's tomb: conservation or replication (but don't forget the "aura")? | Willow Tea Rooms: A tale of tea and trade marks Part 1 | The next round of Cartier: UK Supreme Court will hear appeal re costs of intermediary injunctions | New National IP Strategic Action Plan in China | Full decision of Enlarged Board of Appeal in partial priority / poisonous divisionals referral (G01/15) published |INGRES Conference Part II - Trade Secret, Copyright, Design and Trade Mark Law Developments |5 mistakes to avoid in IP student essays ... and not only there | INGRES Conference Part I - European Patent Law Developments | Remembering Masaya Nakamura, the "Father of Pac-Man" 

Never Too Late 133 [week ending on Sunday 29 January] | IP Summit 2016 (First Part) | When a quote becomes famous: even if it was never quite said that way | The trademark licensing question that won't go away: the standing of a licensee to sue | Would you like a side of Mr Justice Arnold on SPCs with your wind turbine? Teva v Gilead, Abraxis v Comptroller and Wobben v Siemens kick of 2017's patent cases | AIPPI (UK) Event: 2016's patent cases - all you really need to know | BREAKING: CJEU rules that EU law does NOT prevent punitive damages in IP cases | Supreme Court rules Act of Parliament is needed to initiate UK leaving the EU| Book review: "From Maimonides to Microsoft: The Jewish Law of Copyright Since the Birth of Print"| Applications for information on infringers can be made outside of IP infringement proceedings| The Michael Jordan case in China – to be continued 

Never Too Late 132 [week ending on Sunday 22 January] |When this Kat doesn't know, he reaches out to Kat readers: what really happened at the dawn of modern commercial trademark use? I Social media, "WikiLeaks" and false news in the 18th century: Thomas Jefferson and the "Mazzei letter" I Does the economic impact of SPCs necessitate SPC Regulation reform? The European Commission wants to find out I A look at the proposal for the ePrivacy Regulation I BGH: to cease means to recall I Never too Late x2 I Around the IP Blogs 

Never Too Late 131 [week ending on Sunday 15 January] | Arrow declarations can be granted: Fujifilm v AbbVie | Guest Post - China's Patent Boom | Watch out lawyers - do you own your name? 

Wednesday, 22 February 2017

Book Review: The Informal Economy in Developing Nations - Hidden Edge of Innovation?

Off the beaten path of science and technology innovation lies a world of innovation in the informal sectors. Think lifehacks but with the goal of improving handmade soap, making-do with limited materials or other forms of improvisation and improvements outside the formal economy. Do innvotors in the informal sector protect their ideas? If so, how?  Staring with this exam question, a new book examines innovation in the informal economy, its structure, impact and role in economic development. The Informal Economy in Developing Nations book draws on WIPO research and, like the other volumes in the Intellectual Property, Innovation and Economic Development series, aims to inform policy through scholarly analysis, with an emphasis on economics. Edited by IP economists Erika Kramer-Mbula (Tshwane University) and Sacha Wunsch-Vicent (WIPO), the book seeks to apply analysis of innovation in the informal economy to policy.

The informal economy is the part of the economy not monitored by governments. It does not necessarily break laws; it is simply not captured by standard government regulation. Common types of labour in the informal economy include domestic workers, home-based and street vendors, and informal employment in construction, farming and textiles. As the authors detail, innovation in this sector does not follow the classic science-and-technology-innovation (STI), but a doing-using-and-interacting (DUI) process of innovation. IP has been developed for STI, and is less adroit at protecting DUI; hence investigating the informal sector can give us fresh insights into the machinations of IP.

The book is a collection of chapters which build a comprehensive picture of the informal economy and innovation. Early chapters detail the evolution of the definition of the informal economy and statistics, and our current understanding. Later chapters examine country-specific studies in Kenya, South Africa and Ghana, and the final chapters bring the analysis into IP, innovation and policy.

A picture of a man using a home-made welder for
the jua kali sector in Kenya, Erik (HASH) Hersman
A chapter on the informal metalworking sector in Nairobi, by Christopher Bull, Steve Daniels, Mary Kinyanjui and Barrett Hazeltine, looks at the production of metal goods such as pots, pans and wheelbarrows in the Kamukjunji region. The informal sector is so economically and cultural relevant in Kenya, that is is known as jua kali ("hot sun" in Kiswahili), and workers are referred to as fundi. The sector accounts for 20% of Kenyan GDP and the majority of job growth. Using photographic evidence and interviews, the authors identified innovations in the sector. The study finds that while the sector differentiates with quality and style, product or process innovation is sporadic; reverse engineering is the norm and secrecy is discouraged. The collaborative nature of the sector means the strongest 'protection' for innovation stems from first-mover advantage, which is estimated to last two-weeks. Currently, a cost-benefit analysis does not favour securing IP.  The authors conclude that there is scope to improve access to IP protection through awareness and grants, which, along with structural changes to help the domestic sector compete with imports, could benefit the sector.

Turning to South African home and personal care products, Erika Kraemer-Mbula examines the production of products such as lotions, cosmetics and detergents. Kraemer-Mbula notes that South African apartheid limited opportunities for black entrepreneurship, thereby restricting the majority of the population. The informal economy emerged as the, "entrepreneurial response to the legislative limitations." Analysing survey data, the author finds innovations in improved formulations, packaging, process and quality control. 76% of surveyed manufacturers did not feel ownership of the ideas associated with their products. Yet, 80% have their own brand, and nearly half have of respondents use secrecy as a protection mechanism. As is often the case with small businesses, surveyed firms report low levels of IP awareness, or consider it "unsuitable" or "inaccessible." Kraemer-Mbula suggests strategies to support appropriation:
  1. Creation of industry associations
  2. Raising awareness of IP
  3. Promoting use of informal protection mechanisms
Shamnad Basheer, of SpicyIP, picks up on two main themes. He cautions against, "the simplistic tendency to superimpose an existing "formal" IP appropriation regime onto the informal economy," and, "it is foolhardy to assume that the informal sector simply needs to learn from the formal sector and formalise as quickly as possible. On the contrary, the informal economy may have important lessons for the informal economy..." Supporting innovation is important, but a formal approach to IP may not always be the answer.

The final chapters detail the challenges of developing policy to support the informal sector, and the difficulties faced in studying. The authors note that studies point to common strategies for IP protection (appropriation) in the informal economy: social norms, secrecy, customer relationship management, non-IP strategies such as first-to-market, and branding. An entire chapter is devoted to creating an agenda for the measurement of innovation in the informal economy - a longstanding point of frustration for economists. The authors discuss two main sticking points: how to ensure survey and interview questions get meaningful results, and how to chose samples that support valid studies.

The Informal Economy in Developing Nations does an admirable job of detailing current thinking and mapping out the way forward in this area. Readers interested in broadening their understanding of innovation, ways to appropriate the returns to innovation with frugal resources, and potential policy support solutions will find the book useful. The third in the series edited by WIPO Chief Economist, Carsten Fink, the book is commendable for drawing from a geographically diverse group of contributors. Nearly a third of the authors are women. Readers interested in conducting their own surveys will find the annexes helpful, as the full survey instruments (guidelines and interview questions) are included.

The Informal Economy in Developing Nations: Hidden Engine of Innovation?, edited by Erika Kraemer-Mbula, Sacha Wunsch-Vinceny, Cambridge University Press, 2016, ISBN 9781316798942, is available here for £100 in print, and $100 in e-book. Rupture factor: Medium, 400 pages.

Tuesday, 21 February 2017

Copyright law in the UAE: it's not what you might think

Practitioners who think that copyright in the United Arab Emirates (UAE), a market of increasing importance for IP owners, is similar to that
in place in common-law jurisdictions, will be surprised to learn that this is not so. Kat friend Vanessa Delnaud of the Dubai office of Gowling WLG puts us straight on some of the major features of copyright law in the UAE.

“It is common practice for many companies operating in the UAE to run their business on the assumption that the principles enshrined in the UAE Federal Copyright Law are the same as those applied in common law jurisdictions. This is not the case. This false belief may have a significant impact on businesses, since it may result in authors' rights arising out of the company's activities not being effectively passed through to the company, rather remaining with the individuals who created those rights, thus putting the company at risk.

In fact, the UAE is a civil law jurisdiction, highly influenced by French law and Islamic law. As such, the provisions of the UAE copyright law fundamentally diverge, in some respects, from copyright law in common law jurisdictions. It is paramount for companies employing people and/or commissioning works in the UAE to be familiar with the typical main differences between the copyright law in the UAE and the copyright laws in common law jurisdictions.


In common law countries, the copyright may initially vest in the employer or another person/entity for whom the work was prepared. For example, in the United States, under the "work made for hire" doctrine, copyright in a work created by an employee within the scope of his/her employment will automatically (without a written assignment) and initially vest in the employer. A commissioner may also own the copyright in a work made by an independent contractor as a work made for hire under certain circumstances. A similar rule exists under the laws of the UK and of Ireland with respect to works made by employees.

In civil law countries, however, ownership of copyrights in a work vests in the author of such work, until the copyright is assigned through a written assignment instrument. (But, in some countries, there may be some specified rebuttable presumptions of transfer with respect to, for instance, employee-created software, audiovisual works and collective works – works involving numerous contributors). Under the UAE Copyright Law, absent a written assignment of copyright in an employment contract or commissioning agreement, the copyright will not be passed through to the employer or commissioner of the work. Rather, it will remain with the employee or the independent contractor (unless the work may qualify as a collective work under Article 1 of the UAE Copyright Law, which may be difficult to prove in practice). This means that a clause merely referring to the assignment of all the rights in the works as works 'made for hire' would be irrelevant and ineffective.

It is important to note that a copyright assignment is only valid under the UAE Copyright law if it satisfies a number of conditions, including that the assignment should: (1) be in writing, (2) expressly specify the rights assigned, and (3) include statements of the purpose for which the rights are assigned and the geographical area in respect of which the rights are assigned. Without an assignment that complies with the provisions of the UAE Copyright Law, companies are at risk of having to defend a copyright infringement claim from the owner of the rights that were not transferred (either an employee or a contractor), and/or a contractual liability claim from their third party licensee/assignee facing a copyright infringement claim from the owner of the rights. Also, if a company cannot prove its ownership of copyright, it may have a significant impact on the admissibility of any infringement claims against potential infringers as well as on its ability to find investors or on the price of its business when trying to sell it.


In common law countries, there is no prohibition on the contractual assignment of a future copyright in a work that has yet to be created. In civil law countries, however, as a general rule, an agreement that concerns all the works or all the works of a specific type that will be created by an author in the future is void. In particular, the UAE Copyright law contains a provision that deems any disposal of the author's future intellectual rights in five or more future works to be null and void. But if, for example, an employee is employed in a creative role, he/she may complete five or more works within a few hours of signing his employment agreement. As a result, in order to overcome such restrictions, we recommend that companies put in place with their employees and service providers in the UAE a system of confirmatory assignments that should be completed and signed by the employee/service provider once it has created and delivered any work in the context of its employment or service agreement.


Moral rights are personal and cannot be assigned. However, in most common law jurisdictions, moral rights can be waived. It is therefore usual practice to see in assignments or licensing agreements governed by US, UK or Irish law, provisions under which authors waive their moral rights. Such an approach is consistent with the functional view of authors' rights in these countries.

On the contrary, in civil law countries, including the UAE, a general waiver of moral rights would ordinarily be unenforceable. This is because it would be equivalent to an assignment of moral rights, which is prohibited in accordance with the traditional approach of copyright in civil law jurisdictions (pursuant to which authors' works are protected as the products of the authors' personality, so that authors should be protected against any modification of their works). An author may only undertake in writing not to exercise his/her moral rights in relation to a specific person or entity, provided that the agreement specifies the work(s) and specific uses to which the undertaking applies. The more detailed these provisions are, the greater the likelihood that they will, if challenged, prove valid and enforceable in court.”

Never Too Late: If you missed the IPKat last week!

Be ready for the 134th edition of Never Too Late!

InternKat Hayleigh Bosher recaps the highlights of some IP blogs.

Kittens in love …
A Never Too Late celebration of Valentine's day!
Neil Wilkof muses about the intriguing topic of keeping the ‘aura’ of artistic works that are preserved by technological means.

Eleonora Rosati discusses Cartier and Others v BSkyB and Others, after permission to appeal was granted by the UK Supreme Court regarding whether costs should be borne by right holders in the case of a blocking injunction granted due to trademark infringement.

Katfriend Danny Friedmann provides an overview of the National IP Strategic Plan, which sets out various measures for the next five years with the goal of improving the protection and enforcement of IP Law in China.

Mark Schweizer discusses G 1/15 decision issued by the EPO’s Enlarged Board of Appeal, whose outcome means that so-called poisonous divisional applications are dead.

Mark Schweizer presents the second part INGRES annual conference, which covered topics such as Trade Secret Directive, Proposal Directive of the European Parliament and of the Council on Copyright in the Digital Single Market, and the MEGA Brands case.

Eleonora Rosati highlights five common mistakes made by students and non-students, including the non-use of ECLI citation system.

Mark Schweizer shares the remarks of the annual conference of INGRES (Institut für gewerblichen Rechtsschutz), which covered diverse patent topics such as the assignment of priority rights and the Agreement on a Unified Patent Court.

Guest Kat Rosie Burbidge reminisces about the "father" of one the most popular video games, whose colorful ghosts and music have entertained to whole generations, including this Kitten.

This Kitten reports the launch of the latest issues of JIPLP and EJLT, as well as forthcoming events.


Never Too Late 133 [week ending on Sunday 29 January] | IP Summit 2016 (First Part) | When a quote becomes famous: even if it was never quite said that way | The trademark licensing question that won't go away: the standing of a licensee to sue | Would you like a side of Mr Justice Arnold on SPCs with your wind turbine? Teva v Gilead, Abraxis v Comptroller and Wobben v Siemens kick of 2017's patent cases | AIPPI (UK) Event: 2016's patent cases - all you really need to know | BREAKING: CJEU rules that EU law does NOT prevent punitive damages in IP cases | Supreme Court rules Act of Parliament is needed to initiate UK leaving the EU | Book review: "From Maimonides to Microsoft: The Jewish Law of Copyright Since the Birth of Print" | Applications for information on infringers can be made outside of IP infringement proceedings | The Michael Jordan case in China – to be continued | Around the IP Blogs | Sunday Surprises

Never Too Late 132 [week ending on Sunday 22 January] | When this Kat doesn't know, he reaches out to Kat readers: what really happened at the dawn of modern commercial trademark use? | Does the economic impact of SPCs necessitate SPC Regulation reform? The European Commission wants to find out | A look at the proposal for the ePrivacy Regulation | Around the IP Blogs! | BGH: to cease means to recall | Social media, "WikiLeaks" and false news in the 18th century: Thomas Jefferson and the "Mazzei letter"

Never Too Late 131 [week ending on Sunday 15 January] | Arrow declarations can be granted: Fujifilm v AbbVie | Guest Post - China's Patent Boom | Watch out lawyers - do you own your name?

Never Too Late 130 [week ending on Sunday 8 January] | Around the IP Blogs | Sunday Surprises | Trademark and co-branding as a badge of … did you say "location"(?) | 15 fully-funded IP PhD positions are calling for candidates | Never Too Late: If you missed the IPKat last week! | Around the IP Blogs | Biosimilars battle in clearing the way - Fujifilm v AbbVie continues | Book review: Maintenance time and the industry development of patents

Monday, 20 February 2017

Monday Miscellany

The 2017 U.S. Chamber International IP Index entitled “The Roots of Innovation” is now available. The Index provides a roadmap of the IP environment of 45 countries. The results can be also consulted via the interactive tool on the Global Intellectual Property Center of the U.S. Chamber of Commerce website.

On the road of IP environment!
On 28 January 2017, the depletion period for the transitional provisions for the repeal of section 52 of the Copyright, Designs and Patents Act 1988 ended. Therefore, all the replicas or unauthorized copies of artistic works industrially manufactured must be sold or destroyed. 

The first WIPO-WTO Colloquium for IP Teachers and Researchers in Asia will be taking place from 20 until 22 February 2017 in Singapore. Participants of the Colloquium may also attend the 2nd Works-in-Progress Conference “IPScholars Asia” which will take place on 23 and 24 February 2017 at the Singapore Management University. The Conference is a good opportunity for scholars in the field of IP Law and related issues in Asia to present their works in progress. There is no registration fee for attending the Conference. More details, here.

The Conference Copyright 4.0 will take place on 22 February 2017 at the Faculty of Law of the University of Geneva. The Conference will discuss the challenges of IP Law from an international, European and Swiss perspective. Sessions will be in French and English with no simultaneous translations. More details, here.

Free webinar on “IP Commercialization Tactics for Wealth Generation & Innovation”. Patrick Terroir will discuss some means for commercializing IPRs such as patent brokerage, IP sales and licensing. The webinar is hosted by OxFirst and will take place on 23 February 2017 at 5 pm (CET). More information and registration here.

“Showbiz and more … Intellectual Property in the Entertainment Industry” will take place from 19 to 21 March 2017 in Puerto Rico. The event is organized by the Inter-American Association of Intellectual Property (ASIPI) and includes topics such as the challenges of music streaming, the economic model of the big soccer clubs, live presentations and the contracts required and, the industry of video games. More information here.

A call for papers for the 9th Annual Junior Scholars in Intellectual Property (JSIP) Workshop organized by the Michigan State University College of Law. The Workshop will take place on 17 and 18 May 2017 and involves receiving feedback from established scholars in the field of IP Law, communications and cyberlaw. Deadline for submissions is 6 March 2017.

The Faculty of Law at the University of Szeged is calling for papers for the 9th Annual Conference on Innovation and Communications Law (CICL), which will take place on 29 and 30 May 2017 in Szeged, Hungary. Abstracts must be submitted before 31 March 2017 by sending an email to Prof. Péter Mezei at More information, here

*Picture: “Socks the Cat Perched on the Backseat of a Van”, 09/16/1993, William J. Clinton, White House Photograph Office.

Major changes to trademark law in Turkey: read all about it

The long-awaited New Turkish IP Code of Industrial Property, no. 6769, entered into force upon publication in the Official Gazette of January 10, 2017. The new Code repeals and replaces the Decree Laws on Patents and Utility Models, Trademark and Service Marks, Industrial Designs and Geographical Indications. The new Code is set to profoundly change the IP landscape in Turkey, affecting the legislative, administrative and professional components of the law. Kat friend Okan Can, of the Deris Law Firm in Istanbul, summarizes the changes to the trademark law; a further report on the new patent law will follow.

Several major changes have been introduced regarding registrability.
1. Colors and sound marks have been included in the definition of signs that may be protected as a trademark. The wording of the Code also paves the way for motion marks.

2. Trademark applications consisting of a registered geographical indication will be rejected by the Office. Therefore, words that have been registered as a geographical indication will no more be accepted for registration as a trademark.

3. The Code introduces the use of a Letter of Consent, by which the owner of an earlier trademark may consent to the registration and the use of an identical or similar trademark later filed for the same or similar goods or services. The absence of the possibility to submit a letter of consent under the former law was criticized.
Concerning oppositions, these changes are noteworthy:
1.The opposition period- which used to be three months, has been shortened to two months.

2. Bad faith is explicitly mentioned as a ground for filing an opposition.

3. The Code, unlike the former law, enables the applicant of an opposed trademark to require from the opponent show evidence of the use of the trademark on which the opposition is based, if the five-year grace period for non-use of the opponent’s trademark has passed. The same non-use argument can be claimed in a trademark infringement or cancellation action.

4. The parties may settle an opposition through mediation as per the Mediation Law.
The Patent Office will implement the administrative proceedings for a cancellation within seven years of entry into force of the Code, namely by 2024. These proceedings will include cancellation of a registered trademark on grounds of:
1. Non-use;

2. Becoming generic (on the products / services on which the trademark is used);

3. Deceiving the public (as to the characteristics, quality or geographical source);

4. Use of a certification mark contrary to the terms of its technical regulation that are provided to the Patent and Trademark Office.
Concerning infringement, the following changes are especially interesting:
1.The Code specifically provides that the use of a trademark as an essential part of a company/establishment name, or its illegal use in comparative advertisements, is prohibited.

2. Mere registration of a trademark does not constitute a legitimate defense against an infringement claim brought by the owner of an earlier IP right. This is a material change to the law, as the previously- settled Supreme Court case law deemed the mere fact of registration of a mark as a legally protectable use until cancellation of the mark by the Court. The same non-use argument can be claimed in a trademark infringement or cancellation action.

3. The Code introduces the international exhaustion principle instead of the national exhaustion principle provided by the former legislation.
As for criminal aspects, the Code provides for two notable provisions:
1. The Code introduces criminal provisions for trademark infringement only; there are no corresponding criminal provisions concerning patent, industrial design or geographical indications.

2. The Code regulates criminal offences concerning the counterfeiting of trademarks by providing that producing goods or providing services, exposing for sale or selling, importing or exporting, purchasing, keeping, transferring or storing for commercial purposes, by means of a counterfeit mark that infringes the registered trademark rights of a third party, is subject to a term imprisonment of between one and three years as well as the imposition of a monetary fine.

Thursday, 16 February 2017

Tartan Army scores own goal?

The defendants' magazine
Via Katfriend Gill Grassie (Brodies LLP) comes a trade mark story from Scotland, that tells the tale of the trade mark ‘Tartan Army, its alleged infringement, and the resulting decision by the Court of Session. The case is Tartan Army Ltd v Sett GmbH and Others [2017] CSOH 22. 

Here’s what Gill writes:

This was a trade mark/passing off case relating to UK and EU registered marks ‘Tartan Army’ (the Mark) decided just last week by the Court of Session in Edinburgh.

It has all the ingredients of a hard-fought football match between two rivals determined to get the better of each other.

It involved numerous tactical moves, lots of emotion, a few penalties, many injuries and stoppages, extra time and ultimately an own goal just before the final whistle.

The stakes

The ‘honourable referee’ was Lord Glennie, who is an IP designated judge in the Court of Session.

Ultimately, this referee decided there was no infringement or passing off and that a number of trade marks in various classes should be revoked or specifications restricted. 

The case started as long ago as 2009. Now, on the face of it, that seems an inordinately long time to reach what is only the first instance decision. The case rather surprisingly was not brought as an IP case and so was not dealt with under the strict IP case management rules. In addition, it was stayed for a period of a whole 4 years from 2010 to 2014. The lack of any case management followed by this long stay contributed to the delays and only when the case was ultimately transferred to the IP procedure was any swift and focused progress really made. 

Despite the obvious determination by both sides to see this through, there was not a huge amount at stake. The claim for damages and net profits was dropped - probably because the Mark had not been particularly successfully exploited – and the only claims were for injunctive relief (interdict), destruction of infringing materials and expenses/costs. 

The marks

The pursuers (claimants) owned  a number of UK and EU registered marks in respect of the Mark. It seems that some of the more relevant EU trade marks were allowed to lapse in error along the way with applications for new ones, in exactly the same classes, being made as late as May 2016. After a non-use attack ultimately, the only relevant ones left standing in the trade mark team were those in classes 25, 32 and 41. 

Notably there was only one UK valid trade mark in class 25 (articles of clothing, headgear, footwear etc). There were valid EU trade marks however for all three of the relevant classes. [Class 25 being for articles of clothing, headgear and football strips, Class 32 for beers, minerals and aerated waters and other non-alcoholic drinks … Class 41 for publishing services; on line publishing, the provision of on line and electronic publications and digital music, entertainment, sporting and cultural services, information and advisory services related to all of these.]

A tartan army
The beautiful game?

The case did not ultimately turn any issue on disputed facts. Rather it was all about the law as applicable to those facts, ie the rules of “the beautiful game” of trade mark law! 

Just about every point imaginable was argued. 

The pursuers were successors in title to the Mark with first dated UK registration being in 1996. The mark was filed in numerous different classes with widely drafted specifications. Perhaps the zenith of its use was in 1998 coinciding with that 1998 World Cup. It was used for fan merchandise and a few licenses were granted but the commercial results were not great. Use was sparse and intermittent but not commercially significant since around 2008. It had only been used in classes 25, 32 41- albeit not across the full width of the specifications, since 2010.

Personal bar/consent (estoppel) – the first goal to the pursuers’ team!

The defenders were publishers of a magazine called, “The Famous Tartan Army”.  They had approached the then owners of the Mark in 2005 for permission to use the name ‘Tartan Army’ to produce a magazine. An email had been sent on behalf of the then owners on 2 September 2005 authorising use for a magazine called, “The Famous Tartan Army”. Nothing was said in the email as to whether this authorisation  was revocable or not. The pursuers in the action had purported to terminate any informal licence which may have  been granted by that email, by a subsequent email of 31 July 2008. The defenders attempted to rely upon personal bar/consent (estoppel) to argue reliance on the original email granting consent such that it could not later be cancelled. However, this was undermined by evidence that the defenders had already begun to prepare to use the Mark for a magazine with the relevant title in 2004/05.

The judge indicated that he had no doubt that even if the defenders had not received the original email, they would have carried on in any event and used the name for that purpose. In addition, permission, unless otherwise stated, could be revoked on reasonable notice, which would be determined by the specific circumstances. Here notice had been given in July 2008 via the relevant email and the action was not started until 2009. This was more than sufficient time here. 

Also any licence in the 2005 email was personal and not transferable and the owners of the Mark had changed through assignations etc since then. Further the decision to revoke the licence in the later email only came about in light of concerns that the defender’s use was going beyond mere production of a magazine in any event. 

Thus this argument was rejected.

Validity - a draw?

There was also a validity challenge on two main grounds – absolute grounds of refusal and non-use for five years.

The former attack was based on an argument that the trade mark was incapable of distinguishing goods or services etc. Section 3(I)(a)(b)(c) and (d) of the UK Trade Marks Act 1994 were all relied upon. 

The ‘honorable referee’ blew the whistle on this pretty quickly!

Even if the Mark would have generic meaning for the mass of Scotland’s football fans, it could still be distinctive in the sense of being capable of identifying goods or services for which the trade mark was registered as coming from a particular undertaking as opposed to identifying the actual undertaking as the source. That dealt with (a) and (b). Also the fact that the term might often be used as a badge of allegiance to the Scottish Football Team (the Arsenal and Tottenham cases etc) would not prevent its registration as a trade mark.  As (c) and (d) were merely specific instances of lack of distinctive character, these grounds were also dismissed accordingly. 

There was also an argument of 5-year non-use which was a little more successful, with the registered trade marks in classes 24, 27 and 35 all being deleted. This left only classes 25, 32 and 41 standing but with some restrictions to the specifications. 

There was a very interesting argument by the pursuers as an attempt to fall within the exception to non-use by trying to establish that there were proper reasons for it. This was, as the judge put it, “the ebb and flow of the fortunes of the Scottish Football Team (presently more ebb than flow) made it perfectly reasonable for the pursuer to seek a wide protection for the Mark without actually making use of the Mark in relation to items such as carpets, which were only likely to be marketable as and when the Scottish Football Team qualified for a major championship.  This applied across the whole range of classes protected by the trade marks – the larger and/or more expensive the item, the more justification there was for putting off use of the trade mark in relation to the use of that item until the national team enjoys greater success.  He compared the situation to that of World Cup Willie, a Mark in respect of which the Court had accepted that it was reasonable not to have used it for many years.”

However the referee in this instance did not accept that comparison and made the point that World Cup Willie was specifically linked to the success of the English football team on home soil in 1966 and commented that, “it was not surprising that it will have lain dormant for many years since then without that non- use necessarily resulting in revocation.”

Don't overlook the importance
of (case) management
In contrast, the judge remarked that the Mark here had “never specifically attached to one particular occasion” and that the use had been continued in certain respects in relation to clothing and a website despite the lack of success of the Scotland football team.  It was not the case that the Mark’s use had been put into abeyance awaiting the prospect of future success. This argument therefore also failed dismally.

The ultimate own goal?

All of the above was however in vain as the ultimate own goal was that what was left of the pursuers’ brand armoury was held not be infringed.  It was decided very briefly by the judge that there was no infringement or passing off.  The marks were not identical given the use of the qualifier ‘Famous’ which was more than just a mere descriptor. Whilst the marks were similar and  in so far as use for a magazine was concerned  fell within class  41 there was no likelihood of confusion or evidence of such.  There was also a case argued for infringement by use for travel services but the relevant EU trade mark was no longer in play so it was dismissed.
Furthermore, it was not a well-known trade mark under Section 10(3).  For similar reasons, the case on passing off also failed.

Injury time and to appeal or not to appeal?

We are now in the long overdue period of injury time and it remains to be seen if the pursuer will still have sufficient passion (not to say the funds) to lodge an appeal.

Lessons learned

The case got off to a bad start by not being designated as an IP case.  Doing so at the outset would have avoided long delays and considerable (no doubt) wasted costs. The IP Court Rules and Procedure offer very close and strict case management of the proceedings  from the earliest possible stage – ie within just over a month of the case being started. Use of these rules would have kept expenditure and time under control, and added  considerable focus to the action. 

Secondly, use your registered trade mark!

Thirdly, don’t fight for the sake of it, especially when the tide is ‘ebbing away’ rather  rapidly. 

Of course had the Scottish National team been playing in better form over the period in question things might have turned out quite differently …”

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