The IPEC seminar: report by Ava Miller


Chairman’s introduction
Jeremy opened the discussion by drawing our minds to the reasons why we were all gathered: this was to be the beginning of a discussion which, he hoped, would bring us towards an IP enforcement system that will operate more efficiently and improve the valuable IP rights that currently exist. With such lofty aspirations come some compelling difficulties. Jeremy emphasised that that all too often the IP community seeks to focus on the divergences that exist between them, instead of mobilising against the real competition -– the counterfeiters .Despite the army of training and books at our disposal, the threat of piracy shows no sign of abating and if anything appears to be gaining ground.

IPEC-Background and history of the developments that led to the creation of the IPEC

Laurie Self (Covington & Burling)

Laurie commenced the discussion by outlining the background and history of the developments that led to the creation of the IPEC. While Victoria Espinel was appointed to the position by President Obama in September 2009, this role had been in the making for over 10 years. In the late 1990s Congress began attempts to shape the institutional structure in order to coordinate IP enforcement efforts. This was an era in which Congress were increasingly starting to recognise of the value of IP to the US economy, as well as to the need to confront growing challenges to IP rights, such as China and the impact of the Internet.

It was becoming apparent that piracy had taken on an increased level of sophistication, and had become highly organised and efficient. Offenders regarded IP piracy as a low risk criminal alternative to illegal activities such as drugs trafficking, etc. In order to wage an effective fight, comparable to the endeavours exerted in response to the drug trade, a strategic government effort was required.

The response in 1999 was the creation of The National Intellectual Property Law Enforcement Coordinating Council (NIPLECC). Despite its noble ambitions, NIPLECC was a failure. This was in large part to the fact that this task force had no clear mandate, lacked resources and was in essence a very loose agency plagued by inactivity and turf wars. The terrorist events in 2001 and their aftermath meant that the resources of the US Government completely shifted to the priority of Home Security. These events solidified the fate of NIPLECC, which became a non-entity which languished for years.

2004 brought a renewed focus on IP and criminal counterfeit rings. President Bush announced a new initiative, STOP! (Strategy Targeting Organized Piracy). Importantly this new programme had the mandate of the White House, was energised and overall significantly more effective than NIPLECC had been. Following a lengthy lull, IP enforcement in the US appeared to have regained its momentum.

In 2006 a Government Accountability Office (GAO) Investigations Executive Branch report on IP reviewed and detailed efforts of IP enforcement in the US and what needed to happen next. Its key recommendations in order for an IP enforcement role to serve a meaningful purpose included
• A clearly defined purpose
• Identifying specific problems to be addressed
• Clear goals
• Performance metrics
• Clear allocation of cost + resources
• Assignment of specific governmental roles and integration between those roles

Equally there was a clearer recognition that, in order for any IP enforcement role to be an effective position, the profile of this role should have a very clear, comprehensive structure. Such a role should have
• a direct line and accountability to the White House
• credibility and an Executive position
• a clear mission and objectives.

Political history of the IPEC role

Although there was a recognised need for an IP enforcement figurehead, there was some concern within the Department of Justice about what responsibilities such a role would cover and whether such a role would usurp or interfere with the enforcement powers of other agencies.

These concerns are clearly reflected in the final draft of the Bill governing the role of the IPEC. The original Bill was collated as industry’s “wish list” of what the IPEC role should be. The final Bill as it appears is a significantly watered down version of the original text, partly due to the need to appease concerned voices within the Government. Nevertheless the role of the IPEC has had the overwhelming support of industry, with one significant omission. Consumer rights and digital rights groups within the US have been vocal about their concern regarding the strengthening and expansion of the rights of IP owners.

As an example of the balancing of different interests, Professor Espinel solicited comments from a wide range of stakeholders. The result was the Joint Strategic Plan on Intellectual Property Enforcement which, amongst other things, sought to develop robust data-driven economics in order effectively to quantify and demonstrate to policy-makers the cost of piracy to the economy.

Historically the US has taken the position of leader in the worldwide effort towards IP enforcement. Espinel has also sought to lead by example by insisting on strict controls of IP compliant goods, not just for her office but for those of all her contractors and other associates. Espinel has also been very keen to engage with China on IP issues. Espinel has been acknowledged as very effective in articulating defined goals and developing support for those goals. She has also been successful in building consensus between those holding different points of view.

Although Espinel has only been in the position for one year, her perspective is one of optimism, passion and drive. In the words of Laurie, “so far so good!”

The important traits of a potential IP Tsar, as outlined by Laurie, are as follows:

• the role of the IPEC is often a thankless task, with endless turf wars to contend with; the support and resources of Government are essential to survive
• optimism for success
• passion, drive
• ability to consider viewpoints of different stakeholders and to drive for consensus between them.

Above all — consider that the first person to fill any sort of IPEC role will define the role. If such a person fails to live up to expectations, the role may lose credibility; therefore any such IP Tsar should be carefully selected.

Ashley Roughton (Hogarth Chambers)

The next speaker, Ashley, commenced with a tale of a very timid store holder he had represented in a trade mark case, some years ago. The audience was impressed to learn that this had been in the landmark case of Arsenal v Reed. Ashley begged the audience for any statistics, making the very accurate remark that in order to persuade the Government to act on IP enforcement we need good, effective numbers!

Ashley focused on the name an IP enforcement would have, preferring “coordinator” to “Tsar”, considering that if the public are to have faith in the role, the name must give meaning to what the office will represent. Ashley also pondered who (apart from him, Ruth and Jeremy) could possibly fulfil such an IP enforcement role in the UK, commenting it would have to be at the very least an individual capable of appearing on Radio 4 and the Today Programme.

Having defended a number of criminals (and having a plethora of Nike shoes and football shirts in his office to prove it) a key problem Ashley has noted is the lack of consistency in the approach employed by local authorities. Ashley pointed to the example of a trader who has a local authority approve his goods for sale and later being prosecuted by another local authority who is not bound by the earlier decision and decides the goods for sale infringe IP. The differences in approach that the US and UK have in relation to trade mark law was also explored. Ashley made a strong case for dispensing with the use of S.92 of the Trade Marks Act 1994, bearing in mind that the relative efficacy of the penal provisions that now govern the use of false trade descriptions.

Ashley concluded with the thought, that although the UK needs well defined objectives, we could learn much from observing how the Americans manage their system; it is a case of wait and see. It is after all still early days for the American IP Tsar.

Mike Weatherley MP (Vice Chair, All Party Parliamentary Intellectual Property Group)

As a conservative MP Mike is usually of the opinion that, the less there is of government intervention, the better. However, in his opinion, this does not apply to IP or the internet. He explained that, in his opinion, the American IP enforcement model is making up for the inefficiencies happening elsewhere in the system. He also remarked that he had been surprised, when attending an international conference on IP, at the lack of representation from brand owners. Mike believes that, although the Digital Economy Act does have its flaws, promotion and further engagement from brand owners on what they expect from industry would aid in the effective enforcement of IP rights.

Ruth Orchard (Anti Counterfeiting Group)

Ruth was next up and while she expressed enthusiasm at the role of the IPEC within the US, she had some reservations on whether such a role could exist within the UK.

Ruth was of the opinion that the UK has a way to go before we will be ready for an equivalent post, which will be primarily for criminal enforcement, as Espinel’s role is.This is mainly because IP policy and enforcement in the UK are both in the wrong place.

Espinel is focusing on the preparation stage at the moment, which is arguably the 'easy' part at the moment.It will be interesting to observe her progress when Espinel will arrive at the future, more challenging international stages envisaged in the strategy.

Espinel visited the UK and the Commission in early October and impressed industry with her openness and grasp of the issues. She is looking to bring all stakeholders together, including ISPs as well as rights holders, which has not been done in the UK.

Ruth pointed out that it is not actually the first time this has been attempted. The Italians tried it in 2007, appointing a new government post of Italian High Commissioner to combat counterfeiting & piracy - Giovanni Kessler. Kessler made an excellent start, but unfortunately he was not Berlusconi's favourite person, having previously acted as an anti-Mafia prosecutor. He left the post in 2009, and was not replaced.

The main questions concerning the role of the current IPEC are
• How can this role and its goals possibly be achieved with an office of one person and three staff?
• The international aspects of the US plan are perhaps the most crucial for the international community.

Could having the US engaged to that extent in international enforcement possibly be a mixed blessing? Ruth points to the example of China relations and WTO references and expresses concern as to their unforeseeable long-term consequences.

IP is not in itself responsible for business models and capitalism in general. It is the bedrock of all our future prosperity but what needs changing is management and prioritisation, with an effective re-balancing of interests: it is too easy for the criminals and too difficult and expensive for industry (especially SMEs).

So while Ruth expresses that she will watch with interest, she is of the opinion that the UK is not yet ready for the same sort of role. Our IP legislative regime is robust but policy and enforcement are both in the wrong place.

Ruth concluded that grafting a new 'coordinator' post on to the current situation will not address the issues but will just give the Government an excuse not to do anything else.

Alasdair Poore (President, Chartered Institute of Patent Attorneys)

Alasdair commenced with the remark that Tsars are usually characters who are assassinated and never heard from again, and submitted that IP Reviews are a substitute for such Tsars.

Alasdair agreed on increased coordination; instead of telling the public how to go about registering IP rights, he suggested a much stronger focus on enforcement from policy-makers. If people believe that their IP rights will be effectively protected, they will follow the “trail of money” and IP registrations will naturally increase.

The issue of monetary restraints is a major obstacle to effective enforcement for many agencies, Alasdair points to the example of expecting Trading Standards to prosecute for patent infringement actions, when the cost of merely one such action would be enough to wipe out their whole budget! It simply is not realistic or workable to expect that level of commitment from such agencies. Small businesses are similarly negatively affected by such restraints and most small IP owners may not find enforcement to be worthwhile or cost effective.

Alasdair commented on the importance of education as a key area of any IP enforcement strategy, so that the public can indentify what is appropriate conduct in relation to IP rights. Alasdair mentioned that some headway was being made in trying to establish small claims and a fast track procedure in patent courts, so individuals can have a more effective, private route to enforcement.

Dids Macdonald (CEO, Anti Copying in Design)

Dids expressed the difficulties that she had faced as a designer and manufacturer, almost losing her business as a result of piracy which inspired her to set up Anti Copying in Design (ACID) .

Dids gave us an interesting contrast of Google search results for “Obama” +”intellectual property” delivering almost 6 million hits while the Google search results for “David Cameron” and “intellectual property” delivered only 202,000 hits. Dids was of the opinion that just having a prominent IP enforcement role would help raise the profile of the IP and help promulgate the message that IP is the single greatest asset within the country. Dids believes that the US strategy to aggressively protect IP is essential in delivering such a message and that the UK can certainly learn from the US in order to be on the way to economic growth and recovery.

Nicholas Munn (Deputy Director, Copyright/Enforcement Team, Intellectual Property Office)

Nick emphasised the work that the IPO does, working with the Crown Prosecution Service (CPS) on training guidelines which seek to improve IP enforcement as a whole. The Hargreaves report will also detail how the intellectual property system can better drive growth and innovation.

Nick agreed with earlier speakers on the importance of effective statistics, and stressed the need for Government to be able to see evidence focused on value and economic points. Nick then pointed to the need for the IP crime strategy to be updated, and focused on the current lack of coordination. He also alluded to certain processes that the IPO utilises but do not normally publicise, such as the work they carry out with intelligence, Interpol, etc. Much of what Espinel currently does as IPEC, the IPO already does as well; however, Nick does concede that there is still very much the UK could learn from her.

Annsley Merelle Ward (Collyer Bristow, IPKat weblog)

Annsley highlighted the pertinent point that perhaps the biggest lesson the UK can glean from the US model is that an IP role within Government exists at all. There are merely gestures in the UK, but there is no “IP person” with a comparable governmental profile within the UK. It is telling that, when Espinel invited submissions for the Joint Strategic Plan on Intellectual Property Enforcement, she received over 16,000 responses. In contrast, similar reviews in the UK have merely received in the region of just 200 responses.

American stakeholders appear to have been invigorated by this new IP governmental office; perhaps the UK would benefit from a high profile IP enforcement official who could focus energy and comments from a wide range of interested parties.

David Rosenberg (Glaxo SmithKline)

David indicated that he was not convinced that the UK did need an IP Tsar. He agreed that of course coordination of different agencies was needed but was sceptical of focusing too much on statistics, as these can be manipulated to demonstrate almost any conclusion. David also emphasised that the US is fundamentally different from the UK. At policy level in the US there is a belief that IP is a driver of the economy, David was not so convinced if the same was true in the UK.

Chairman’s summary

Jeremy concluded by considering whether the IP community can play a more active role in informing the public about how IP can be utilised, especially as a tool to maximise wealth. He pointed to the example of Wayne Rooney and the Beckhams, who clearly benefit from utilising their IP rights through licensing. Efforts to engage the public and publicising IP may go a long way towards educating and thus self regulating IP rights, perhaps the best form of enforcement.
The IPEC seminar: report by Ava Miller The IPEC seminar: report by Ava Miller Reviewed by Jeremy on Wednesday, November 24, 2010 Rating: 5
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