Handbags at Dawn 3: ACID, goods in transit and the morality of fashion advertising

First to speak at this year's IP and Fashion post-lunch session was ACID CEO Dids Macdonald, who reminded us that every product in the shops is the result of a design process::"designing is not like sprinkling fairy dust: it requires skills that take years to develop", she noted.  Dids gave the background to the UK's current designs consultation, which closes on 2 October, and then gave us three anonymised case studies involving micro- versus macro-enterprises, in which small designers (and 87% of UK design companies employ fewer than 10 employees) have struggled to assert their rights against massive corporations. Since innovation through design is something in which UK designers excel, it is important to ensure that innovative design is adequately protected. The case studies made depressing reading, since neither the possession of an earlier and valid design right nor the establishment of a strong case of infringement guarantee success against the large resources, intransigence or inertia of the infringer can frustrate a claimant with limited resources. Dids then described the ACID IP Tracker, for "cost-effective tracking of confidential IP content to third parties".

Dids then threw out a challenge to the lawyers present: can they find a means of enabling disputes to be settled without the need for endless expensive letters between law firms? A sensible mediation scheme would be good, as would be greater support for ACID's voluntary code of conduct for retailers.

Following Dids came Alice Gould (Harrison Goddard Foote), speaking on the legal issues raised when infringing (or potentially infringing) goods aren't actually in the shops.  In 2011, the European Commission reported, 115 million goods were detained on their way into Europe -- over 55% of which are fashion goods (more than 65% if you include sports shoes).  Where do they come from? China and Hong Kong account for around 80% of them. The high figures and recent increases have been attributed largely to increased use of the internet and the postal delivery of individual orders. Health and safety issues are not just confined to medicines: shoes with toxic dyes and sunglasses which don't filter out the requisite rays are among other dangers.

Alice then took the conference participants through the relevant EU Regulations, of which there have been quite a few. She reminded us that non-commercial importations for personal use, grey good infringements, non-identical and goods in free circulation within the European Economic Area are not governed by customs detention rules. The Regulations can only be invoked where the IP rights owner has registered its interest with Customs. While this is free, it has to be renewed annually or it lapses. Even where the IP owner hasn't registered its interest, if notified by Customs that suspected infringing goods have been seized, it still has a short window of opportunity in which to register with its national authority. Under SI 324/2010 in the UK, there is a simplified procedure under which seized goods, following notice, can be destroyed.

Next Alice turned to transshipped infringing goods that were not actually put on to the market and the "manufacturing fiction" which, the Court of Justice said in the Philips/Nokia rulings (noted here by the IPKat), does not exist. In short, said the CJEU, the free movement of such goods can be suspended if they are suspected of being infringements, but can't be seized or destroyed unless there is proof that they infringe. There are however proposals to broaden the EU Regulations quite considerably -- though goods carried in personal luggage are likely to remain untouched. While IP owners and exclusive licensees will be able to seek to invoke these rights, no such power is given to their professional representatives.

In conclusion, Alice encouraged IP owners to conduct an audit and check precisely what rights they have, and take the trouble to register with Customs where appropriate. Do take action to discourage infringers, even if all it does is to shift infringers from your products to someone else's. Secure your supply chain and emphasise that you don't want to deal with any people who do get involved with infringements -- and join organisations like ACID. It's good to develop an early warning system with people in your business chain and with other businesses within your sector. Finally, lobby for changes in the law!

The final speaker on the programme was the Institute of Practitioners in Advertising's Rebecca Chong ("First and foremost I'm an intellectual property lawyer"), who found herself discussing the regulatory dimension of the advertising of fashion brands -- particularly to young and more vulnerable consumers.  Rebecca reviewed the various codes of advertising practice, which go so far as to address even advertising via social media such as Twitter.  The most important provision is s.3 of the Code of Advertising Practice on misleading and insufficient advertising, under which the post-production enhancement of Julia Roberts' skin by post-production techniques (air-brushing) led to a complaint against the advertiser being upheld.

Advertising for children has been the subject of recent government attention, particularly with regard to the commercialisation and sexualisation of children, topics addressed by the Bailey Review in 2011.  Anything that causes the physical, mental and moral harm of children is unacceptable. An example of an unacceptable advertisement (right) shows a young model in a sexually provocative context.  Even though the advertisement was placed in a magazine that was not directed at children, a combination of factors indicated that it was unacceptable.

Other advertisements have been condemned for encouraging children to develop an unhealthy body image, which in turn could damage their long-term health.

It's actually difficult for advertisers to maintain artistic integrity and display creativity while keeping in line with regulatory requirements and public concerms -- but the restrictions can also help the industry to demonstrate its creativity by channelling it into different directions.