12 April, 2014

Retrospective - The Modern Concept of Breach of Trust in Intellectual Property

As was discussed on this very blog some five months ago, trust is imperative in the sphere of invention. With billions of dollars being put into the research and development of products, services and intellectual output, maintaining the veil behind which the future monetary incentive lies is highly important. Without this companies and individuals would have a hard time gaining from their innovations, and it could potentially cause stagnation within technology and creative output as no real reason exists for the investment. The previous article touched on the early days of breach of trust in such instances where such a fiduciary relationship is broken, but such actions have since evolved and stand far from their origins in the mid-1800s.

Often thought of as the modern basis for breach of trust is the case of Coco v A N Clark (Engineers), decided in 1969 in the High Court of the United Kingdom. The case concerned Marco Paolo Coco, a man who designed an engine to be used in mopeds, subsequently entering into negotiations with Clark for the manufacture of the aforementioned engine. During these meetings Mr. Coco provided the defendant information relating to the engine under the expectation that they would manufacture it once the negotiations had ended. The negotiations broke down eventually and no contract was entered into by the parties. After this the defendant started to develop their own moped engine, the design of which resembled Mr. Clark's engine quite vividly, leading to Mr. Coco arguing the defendant had purposefully broken down the negotiations in order to develop its own engine based on his design; subsequently seeking an interim injunction to prevent the defendant from using the information he had provided them for the production of their engine.

Orville had also developed a moped with more "fantastic" results
In the end the High Court had to decide whether Clark had breached the trust between them and Mr. Coco. Justice Megarry, in his judgment, saw that three elements had to be satisfied for there to be a breach of trust: "First, the information must itself... have the necessary quality of confidence about it; secondly, that information must have been imparted in circumstances importing an obligation of confidence; [and] thirdly, there must be an unauthorised use of that information to the detriment of the party communicating it". Whether the information does possess the quality of confidence was well defined by Lord Greene in Saltman Engineering v Campbell Engineering: "The information, to be confidential, must, I apprehend, apart from contract, have the necessary quality of confidence about it, namely, it must not be something which is public property and public knowledge. On the other hand, it is perfectly possible to have a confidential document... which is the result of work done by the maker upon materials which may be available for the use of anybody; but what makes it confidential is the fact that the maker of the document has used his brain and thus produced a result which can only be produced by somebody who goes through the same process". The latter two requirements are an assessment of whether a reasonable person would see the circumstances are importing a quality of confidence, while the claimant would then have to give evidence as to the unauthorized use of that information and the detriment which resulted from that use.

Having considered all of the aforementioned requirements the claimant's action failed, and no injunction was therefore granted. In Justice Megarry's decision the claimant's case was weak at best, and his Honor saw that where information was given to the other party in the expectation that the claimant would be paid, the Court saw that an injunction would not be an appropriate remedy in that instance. Justice Megarry did, however, order that Clark would have to pay a royalty of 5 cents per engine to the claimant should he intend to manufacture those engines.

The Coco case perfectly illustrates the potential loss and problems which could result from a breach of trust should the other party abuse that information for their own benefit. Although the case failed, it still remains an important hallmark in assessing whether a breach of trust has occurred even today all over the common law. 

08 April, 2014

What is Inappropriate in Trademarks?

As times have changes and society has moved on from its perceptions about race and related terminology, what is acceptable and what is not has shifted quite drastically. This type of shift more often than not also impacts the judicial sphere, and a great area where this can be seen is trademarks. Under several common law jurisdictions, such as the US, Canada and the UK, certain marks are not registrable because they are disparaging against certain people or is contrary to public morality. What entails such a mark will change as society's perceptions over what is offensive or disparaging change; however this issue has been brought back to light after a recent US Patent and Trademark Office decision over a mark.

The mark in question was 'Washington Redskin Potatoes', relating to the marketing of entertainment services and certain merchandise, with no actual connection to the sale or marketing of potatoes. In addition to the confusing connection with foodstuffs the services being sold by the applicant have nothing to do with the famous American football team either, increasing the uncertainty behind the name and its use.

Irrespective of these considerations what remains interesting is the rejection of the mark by the USPTO as they deemed "...the connotation [of the word Redskin] is disparaging", backed by the National Congress of American Indians' view on the word. This raises a point about the legitimacy of the Washington Redskins' trademark as well, due to it using the same mark which has been clearly deemed as disparaging. This, however, is still not as straightforward as one might think based on the USPTO's assessment of the Redskins Potatoes mark. In the case of Pro-Football v Harjo the very mark the football team owns came into contention, with the Court of Appeals upholding the team's mark due to the appellant not being able to challenge it as they were late to do so, and thus failed under equity. Although the initial Trademark Trial and Appeals Board decision did state that the mark "...may be disparaging of Native Americans to a substantial composite of this group of people... [and] may bring Native Americans into contempt or disrepute"; clearly aligning itself with the rationale of the USPTO's decision some 15 years later, the issue of whether the mark would be disparaging to American First Nation people never was fully addressed on appeal due to the inexcusable lateness of the complaint by the appellant.

How would such marks be treated in other common law jurisdictions then? In Canada the Canadian Trade-Marks Act stipulates that a mark cannot be awarded if it is "...likely to be mistaken for... any scandalous, obscene or immoral word or device". This could be a number of things, which could include names which could be seen as derogatory towards a subset of people, such as First Nations people. The Washington Redskins however do own the trademark in Canada as well as the US, clearly demonstrating that the mark could be seen as acceptable, although having been registered over 30 years ago. The mark has never been challenged in Canada, but should the Redskins' mark be challenged further or even potentially lost, it would undoubtedly spur Canadians to do the same.

In the UK under the current Trade Marks Act 1994 no marks can be registered which are "...contrary to public policy or to accepted principles of morality". In the case of Re Hallelujah Trade Mark this was seen to being an assessment of morality under current standards as to not cause offense to anyone or any segment of the populous. Much like in the US and Canada the mark is still registered in the UK, clearly indicating an acceptance of the mark which was registered nearly 30 years ago. The mark has not been challenged in the UK.

As can be clearly seen what is immoral or inappropriate can vary wildly over decades or even years, making a definitive line differentiating what is or isn't appropriate almost impossible to set. Morality has always been a subjective concept, making it even harder for the judiciary or the legislature to effectively enforce it without upsetting one party or the other. What can be said through the Redskins saga is that not all marks exist purely for the sake of offense, and that what truly is inappropriate in trademarks has to be left open and moldable to the standards that exist at the time of assessment. Whether the Washington Redskins' mark will be further challenged will be left to be seen; however this writer for one thinks most parties will not be able to do so under equity, at least not in the US.

Source: Bloomberg

03 April, 2014

Retrospective - Inventive Step in Patents

Improvements on older inventions is arguably the cornerstone of technological advancement, and more often than not can be equally or even more important than the original invention. This however has to be balanced between what is truly an improvement and what is merely something presented under the guise of an improvement only to be able to control currently or formerly patented subject matter. Under the Patents Act 1977 this is a matter of assessing whether the improvement in question is an 'inventive step' under the Act. The provisions defines this as being such if "...it is not obvious to a person skilled in the art, having regard to any matter which forms part of the state of the art". Although the section is clear in its intent, the test in how this would be assessed was left to the courts to further specify on.

The case in question which tackled the inventive step, laying down the modern application of this requirement was Windsurfing International v Tabur Marine (Great Britain), decided in 1985 in the Court of Appeal. It concerned a patent which protected the design of a wind surfboard, owned by Windsurfing International. The patent essentially consisted of a surfboard to which a triangular sail was attached, providing wind propulsion for the board, and a joint allowing for the sail to move according to where the wind was coming from. The defendant was licensee of the patent, operating in the UK. The two parties subsequently fell into a dispute, after which Windsurfing International sued the defendant for patent infringement. Although the case related to the old Patents Act 1949, the principle of inventive step still applies to the current 1977 Act even though the two pieces of legislation differ.

Cowabunga, dude!
The defendant challenged the patent through their argument that there was nothing new or novel about the patent where a sail is attached to a surfboard, asserting that the patent did not involve an inventive step, therefore allowing the Court to revoke the patent. Similar designs have been published in the US and the UK in related magazines in the late 1960s, and the defendant also presented evidence where a 12-year-old boy had made a similar craft as early as 1958 in the UK, predating the patent by over a decade.

Respective of all evidence presented in the case the Court was still faced with the question of whether the patent included anything which was new, and therefore involved an inventive step, protecting it from revocation. The question was aptly answered by Justice Oliver, who subsequently postulated the test for obviousness in relation to the inventive step:
 "...[the question] has to be answered, not by looking with the benefit of hindsight at what is known now and what was known at the priority date and asking whether the former flows naturally and obviously from the latter, but by hypothesizing what would have been obvious at the priority date to a person skilled in the art to which the patent suit relates, who is assumed to have access to what was known of the art in the [UK] immediately before the priority date".
The test, in other words, is an assessment of what the new idea or concept is which is protected; who would be a skilled person in the related art and what would his knowledge be based on commonly available information in the art be at the time; what are the differences between any pre-existing art which is used in comparison; and whether the differences or improvements in the new patent would have been obvious to the aforementioned person skilled in the art. The Windsurfing test has since been further clarified in the case of Pozzoli Spa v BDMO SA, but still remains quite relevant in deciding whether a patent truly involves an inventive step or not. In the case the patent was revoked, as prior art clearly showed the patent did not involve any steps which were not obvious to a skilled person in the art, with the Court heavily relying on the evidence provided where a 12-year-old boy had preempted the design, making the creation of such a craft quite obvious to anyone even remotely skilled in the area.

Similar considerations are made under other common law jurisdictions, such as under the Canadian Patents Act or in the United States; however the North Americans often refer to this as non-obviousness rather than an inventive step. Bar the different wording the substantial considerations are very much alike. This only shows how important true inventiveness is under patent legislation.

29 March, 2014

Google v Viacom Legal Marathon Ends

Seven years is a long time, both for canines and in litigation, and one such marathon has just come to a close as Google and Viacom have agreed to settle their prolonged clash. Having started in 2007 the legal struggle has shown just how valuable copyrighted content and its use for other purposes is for both parties involved.

The initial proceedings were brought on by Viacom over the use of its content, which was uploaded onto the video sharing website YouTube; one which has been owned by Google since 2006. Viacom sought over 1 billion dollars worth of damages, pertaining to over 100,000 different clips on the website. Google argued that per the safe harbor provisions (more in-depth discussion on this particular area can be found here) in the Digital Millennium Copyright Act the search engine giant could not be liable for the infringement of its users who upload said content onto their website.

Rover was puzzled by the process entirely
Three years later the District Court of New York ruled in its summary judgment that Google was protected by the safe harbor provisions, much to the chagrin of Viacom. The decision was subsequently appealed, and took another two years for the matter to face its second decision by the Court of Appeal's revival of Viacom's appeal. The matter was yet again brought to the District Court the following year, where Justice Stanton upheld his previous decision three years earlier.

This is where the situation has stood, and as said the parties have agreed to finally put the matter to rest and settle. The terms of the agreement were not released, however it has been noted by ReCode that no money has been exchanged. Arguably this is a sensible approach by both parties, and brings one of the more gargantuan claims in copyright's modern history to an end. As has been speculated the settlement could also relate to newer sharing models by Google and content owners, where part of the revenue made through their videos, uploaded legally or not, and thus gives Viacom the monetary incentive they want for their content.

The parties released a joint statement declaring that "[t]his settlement reflects the growing collaborative dialogue between our two companies on important opportunities, and we look forward to working more closely together", clearly showing a more amicable ending to the saga. This further strengthens the relevance of the DMCA safe harbor provisions in relation to video streaming websites, and clears the potential hazard that a ruling against Google would have caused for the Internet.

Source: BBC

23 March, 2014

IP Iustitia's First Anniversary!

For those who might have glimpsed at the very beginnings of IP Iustitia, the blog has evolved quite a bit after a full year of operation. Who would have thought things would grow to what they are today, and for one the success the blog has had only spurs this humble writer to go further and improve. From the bottom of my heart I would like to thank all of my readers, both casual and subscribed, and hope the following years will be as great as they have been for the very first one.

I would also like to thank those who have given me feedback through comments on the blog itself or via email, and those who have either favorited the blog's articles on Twitter or retweeted them onward. I have always wished for my readers to participate and to help the blog grow and want to encourage you all to keep doing so as we go forward!

If you have not done so yet, subscribe to the blog via RSS or email (with a convenient box to do so on the sidebar of the blog), and you will receive all new articles directly to your favorite RSS reader or email address. The site's Twitter profile also posts all new content automatically, and can be used to share and interact with the blog directly!

As a final note, I would like to thank you, the reader, again. It is you who I do this for and I would have never believed things would get to this point in only a mere year. As said I will endeavor to make things even better and to produce even more high quality articles on current and past topics in the IP law sphere. If you have any questions or suggestions about the blog's future or its content, please email me, as I would love to hear your thoughts after a year more than ever!

Here's to an even better 2nd year!

18 March, 2014

Retrospective - Thumbnails and Inline Linking

The Internet has been the vocal point for most important developments regarding copyright since its emergence. Many cases have dealt with all manner of issues, such as ISP liability and over electronic scans of books, and there seems to be no end in sight as the law tries to adapt and mold itself to the electronic sphere. A staple feature of the world wide web is thumbnailing, where a smaller image is given to represent the real picture, often used in both search results and web pages when linking to said pictures, to make their identification and finding easier. The legality of this practice can be questioned, especially since it does, prima facie, create a copy of a work when it might not be sanctioned. However the determination of the aforementioned legal conundrum happened in the early years of the 21st century in the US Court of Appeals.

The case in question is Kelly v Arriba Soft Corporation, decided in 2002 initially, with an amended final decision being published in 2003. This concerned professional photographer Leslie Kelly, who posted some of his work on his website or others which duly licensed Mr. Kelly's works. The defendant, Arriba Soft, were the operators of an internet search engine called Ditto (which has since gone bankrupt), which displayed smaller versions of images as a part of their given search results as opposed to merely a text link to the image. Through this they amassed a database of pictures by copying the images from other websites such as Mr. Kelly's website or others which contained his works. Once Mr. Kelly found out that Arriba Soft had copied his works onto their database, he subsequently sued the corporation for copyright infringement. 

A very different thumbnail
In their judgment the Court of Appeals had to assess whether Arriba Soft's use of the images would fall under US fair use in section 107, as the reproduction of copyright protected images is only available to those who own the copyright or use the works under fair use. In their judgment the Court saw that the use of the works was both commercial and transformative, although regarding the former the use's nature was more incidental than purely for commercial gain, as Arriba Soft did not directly benefit from the displaying or selling of the images. Due to the smaller size and lower resolution of the images, their use of said images was clearly transformative from the more aesthetic nature of Mr. Kelly's work when displayed in full. As Justice Nelson stated: "The Copyright Act was intended to promote creativity, thereby benefitting the artist and the public alike... Arriba's use of Kelly's images promotes the goals... The thumbnails do not stifle artistic creativity because they are not used for illustrative or artistic purposes and therefore do not supplant the need for the originals. In addition, they benefit the public by enhancing information-gathering techniques on the internet"

The nature of Arriba's use of Mr. Kelly's work was very different to their intended use, being more as aesthetically pleasing works of art as said above, which the thumbnails clearly were not. Even though Arriba Soft had copied the entire image into their database the Court saw that this was reasonable for their use and would not be substantially enough to merit infringement. Finally, the Court saw that Arriba Soft's use of the images did not harm Mr. Kelly's intended market, as clearly one can say that the arts market would be wholly different from that of search engines. In addition Justice Nelson stated well that: "By showing the thumbnails on its results page when users entered terms related to Kelly's images, the search engine would guide users to Kelly's web site rather than away from it". Clearly the thumbnails would only increase the potential market share of Mr. Kelly's work, directing traffic to his website all the while giving search engine users a preview of works quickly and potentially increasing their interest. As such the Court decided that Arriba Soft's use fell under fair use.

Thumbnails can be said to be very essential to modern uses of search engines, and create a great avenue from which both parties can benefit. Without them finding images would be exponentially harder. This is clearly demonstrated by the quick modification of the Court of Appeal's initial decision, which would have impeded such functions through its decision that displaying full-sized images would infringe copyright. Search engines are a complex beast, and will continually evolve, challenging the legislature and judiciary to adapt and potentially protect the free operation of the Internet and discovery of its content. 

12 March, 2014

Where Does Piracy Stem From?

Almost as big of a question as how do you stop copyright infringement, if not bigger, is where does it actually stem from? Why do people pirate content for which they should pay for enabling the content creator or creators to benefit from their hard labor. Although a myriad of answers can be given and argued, a recent unearthing of a letter by Google to the Australian Minister of Communications, Malcolm Turnbull, gives the communication company's view as to the question.

In their letter Google's Head of Public Policy, Iarla Flynn, expressed the company's view on the root causes of piracy: "...we believe there is significant, credible evidence emerging that online piracy is primarily an availability and pricing problem". On the face of it, one can agree with Ms. Flynn's assertion. Although blatant entitlement and sheer greed can be the reason for many when it comes to piracy, more often than not this can be pure availability. The most pirated TV show of 2013 was Game of Thrones, which provides the perfect example of this conundrum for many. As such the popular fantasy show is incredibly hard to access all over the world. It is provided as a part of HBO's GO system, which allows for the instant viewing of the channel's shows on-demand alongside its broadcasting on the actual HBO channel. However, the service is only usable in the United States, and even there the pricing can be steep, access costing over 100 dollars a month, as it is included in cable service bundles, being inaccessible to those without a qualifying package. Due to this many clearly have no other option but to pirate the show if they want to follow it as it progresses, or wait until the season is released on DVD and being severely behind on the newest developments discussed at the water cooler. Money isn't necessarily the only issue here either, with delays in the show's airing times contributing to piracy  rates as well.

As a possible solution to this problem is the increasing of availability and making pricing both affordable and equitable. A great example of recent successes proving just that are both Netflix and Spotify. Both services provide the consumer with the opportunity to pay a monthly fee for unlimited listening or watching of music and television. Although regional offerings vary in terms of content, both services have showed success in curbing piracy. Are they the answer to piracy fully? Arguably not. Copyright infringement is all too convenient, easy and has become a part of peoples' daily lives, with the stigma associated with it having almost fully dissipated as a result. There will be no time where people will not abuse that which they have the ability to abuse, and the Internet as a vehicle is no exception.

So what would the answer be? This writer for one would not be an advocate for more strict regulation and surveillance to prevent infringement. This would simply result in the increased disapproval of such actions, as can be illustrated by the recent Internet filtration by the United Kingdom, and only hinder access by those who legitimately want to access content. Arguably the ball is in the content providers' court, and the legislature should encourage the market to react rather than demand more regulation. With recent reforms showing a clear intent to expand freedom in relation to copyright, the onus is more on the providers than ever.

Piracy has been, and will remain, a hot button topic in the scheme of copyright, and rightfully so. Discussion should encourage change on both sides, but still remain sensible enough to prevent over regulation on strict surveillance. Although discussion has been scarce in the US especially, one can only remain hopeful and keep the discussion alive.