14 November, 2018

This Tastes Right - CJEU Rules Out Copyright Protection for Taste of Cheese

Sometimes a case comes around that both baffles, and excites intellectual property specialists. Something that makes you wonder why it had gone that far in the first place (let alone the costs), but nonetheless is something that we all want an answer to from the courts - and more often than not never do. Such a case has been the cheese taste copyright case, which seeks to answer the age old question; can you have copyright in the taste of cheese? This writer cannot even count the number of times he's wondered this very question, and finally, we have an answer, as the CJEU handed down their decision earlier this week.

The case of Levola Hengelo BV v Smilde Foods BV concerned the cheese "Heksenkaas", which is a spreadable dip containing cream cheese and fresh herbs, which was created by a food retailer in 2007, which then sold the rights to Levola. The manufacture process for Heksenkaas has been granted a patent in 2012, but no other registered rights vested in the product. Levola's competitor, a fellow cheese-making company, Smilde, sold a product called "Witte Wievenkaas", which, according to Levola, infringed on the 'taste' of Heksenkaas, and brought proceedings against Smilde, ultimately ending up with the CJEU.

The referring court asked the CJEU two questions relating to the protection of food through copyright.

The CJEU tackled the first question, which, in essence, asked "...whether Directive 2001/29 must be interpreted as precluding (i) the taste of a food product from being protected by copyright under that directive and (ii) national legislation from being interpreted in such a way that it grants copyright protection to such a taste".

The Court considered that, for copyright to vest in the 'taste' of cheese, it would need to be classified as a 'work' under the Directive. This comprises of two cumulative factors: (i) the work has to be 'original' in the sense that it is the author's own intellectual creation; and (ii) only something which is the expression of the author's own intellectual creation may be classified as a 'work'.

In addition to the Directive, the Court noted that the above would also have to comply with the Berne Convention, more specifically Articles 1-21 (which deal with the requirements for copyright protection under the Convention). Specifically, copyright protection would only be afforded to "...expressions, but not to ideas, procedures, methods of operation or mathematical concepts as such".

Following the provisions above the Court considered that for there to be a 'work' under the Directive, "...the subject matter protected by copyright must be expressed in a manner which makes it identifiable with sufficient precision and objectivity, even though that expression is not necessarily in permanent form". This means that authorities need to be able to identify the subject matter of what is being protected clearly and precisely, and for others in the marketplace to ascertain the same. The subject matter of protection should also not be subjective, but one that can be observed objectively bu anyone.

Applying this to the question at hand, the Court noted that "...[t]he taste of a food product cannot, however, be pinned down with precision and objectivity", as it is not in a tangible or observable form (although one can experience it through the tasting of the goods). There are also many variables in the sensations and experience of any particular taste, which change over time and through consumption habits etc. It is also not possible, at least in the state of current scientific developments, to precisely and objectively identify the taste of a food product that distinguishes it from other food products (although this writer wonders if a deep analysis of the food's compounds would get us closer, even though this, again, changes with the ingredients, their age, storage methods and the like).

The Court therefore concluded that the taste of a food product therefore cannot be classified as a 'work' under the Directive, and would not be protected by copyright. Similarly, national legislation cannot protect the same subject matter in compliance with EU laws.

Due to the negative answer to the first question, the second question was not necessary to be dealt with.

The CJEU was clearly correct in their decision when it came to the taste of cheese, as it is something that one cannot easily pin down and therefore clearly protect. Once food chemistry and science develop to a point where we can isolate these differences, it might be possible to actually show what the taste of a given food item is, and potentially protect it under copyright. While waiting for this, we can eat our imitation Heksenkaas with reckless abandon.

01 November, 2018

Fixing Your Rights - The US Copyright Office Expands Right to Repair

The right to repair the devices, vehicles and other goods you own seems to be a given right when looked at on the face of it. After all, you bought the item, therefore you should be able to maintain it and try to prolong its lifecycle in your use; however, this is not exactly this simple. Some IP provisions hinder or even outright prevent the repair, modification or tinkering of those goods, particularly through copyright in proprietary systems to those goods. Many have fought over the right to repair, discussed on this blog before, but the line hasn't clearly been drawn in the sand as to what is okay and what isn't. In the light of this, the US Copyright Office was recently petitioned to rectify this wrong, and the right to repair movement took great strides in allowing this practices.

As a primer, under 17 USC 1201, a person is not allowed to "…circumvent a technological measure that effectively controls access to a work protected under this title". These types of measures include digital rights management software, or the encryption of software or underlying code in sophisticated machines or goods. More recent examples include the disabling of iPhones that detect third-party repairs or parts, and John Deere preventing tractors from being repaired under their user licences.

In a ruling released last week (including a very thorough background document here), the Copyright Office decided that owners of certain goods and vehicles could repair those devices without infringing on copyright.

Firstly, the Office allowed the 'jailbreaking' of computer programs (i.e. gaining access to the operating system to allow the installation and running of unauthorized software) relating to 'voice assistant devices like Amazon's Echo or Google's Home. The exemption already applied to smartphones, and is now extended to these types of devices.

Not all damage is fixable, even with extensive rights
The Office also focussed on computer programs that disabled the repair and diagnosis of land vehicles, specifically personal automobiles, commercial vehicles or mechanized agricultural vehicles (including any telematics systems, i.e. an in-vehicle computer). When the circumvention of the software is needed to repair, diagnose and lawfully modify the vehicles, the Office considers this circumvention to be lawful. They also expanded this to include the same for smartphones, home appliances such as fridges and HVAC or electrical systems. What needs to be noted is that 'maintenance' specifically only includes the "…servicing of the device or system in order to make it work in accordance with its original specifications and any changes to those specifications authorized for that device or system".

Any repairs discussed above are also allowed to be done by third-party vendors, and not simply the owner of the device and/or vehicle. This is a huge step, as the third-party repair market is important to support those who do not have the technical know-how or inclination to do their own repairs.The ruling also does not exempt some circumventions, including any non-land vehicles (such as planes and boats), or devices that do not fit into the categories set out above. One can understand the hesitation to give a very broad exemption by the Copyright Office, as this could have unintended consequences or provide for uses that should not be allowed for. This distinction will undoubtedly change, but incremental changes can hinder the steps towards progress in the long run. The Office also denied the right to repair in relation to gaming consoles, which raised strong concerns of piracy if allowed.

The expansion of the right to repair devices and vehicles is an important part of protecting the environment and minimising unnecessary purchases of new devices or vehicles when the repair of the old one would have been prohibitively expensive. Many advocates for this right will rejoice at the ruling, while manufacturers will be less than thrilled losing control over the devices or vehicles once sold to the end-user. It remains to be seen whether the Office will expand these exemptions in the future, but seeing their inclination to do so, this writer thinks these rights will only be expanded on once new technologies become more commonplace and the need for their repair necessary.

Source: iFixit

18 September, 2018

I Spy with My Little IP - An IP Address Not Enough to Identify Copyright Infringer, Says US Court of Appeals

The identification of infringers of intellectual property is incredibly important in order to mount a proper and, above all, fair prosecution of those who are infringing on your rights. This is, however, exceedingly difficult in the Internet age, where the person downloading a movie, for example, is difficult to tell from a household of four, let alone the swathes of nameless ‘individuals’ occupying Internet services. The IP address of a given for each computer, identifying them separately in a network when connected to it, has long been one way of distinguishing the infringers from other users. The protocol still has its issues in certainty, and therefore, is it a reliable piece of evidence when establishing liability? The US Court of Appeals took on this question not long ago.

The case of Cobbler Nevada LLC v Thomas Gonzales concerned the movie ‘The Cobbler’, for which Cobbler Nevada owned the copyrights to. Due to its popularity, the movie was swiftly shared on many websites online using the BitTorrent protocol. Cobbler Nevada identified one IP address in Nevada which downloaded and distributed the movie without authorization, later further identified as being Mr Gonzales’ internet service. The connection, however, was a freely accessible one, which was used by both residents and visitors at an adult care home. Legal counsel for Cobbler Nevada determined that they were unable to confirm that Mr Gonzales was the infringer in question. Nevertheless the company filed a complaint against him, alleging they copied and distributed the work online, basing this on the fact that he was the subscriber of the IP address used to do so.

The crux of the matter is whether the IP address used in the matter is enough to prove that Mr Gonzales had indeed been the infringing party. The Court correctly highlighted that “…a particular IP address (i.e., an account holder)… does not mean that the internet subscriber is also the infringer… simply establishing an account does not mean the subscriber is even accessing the internet, and multiple devices can access the internet under the same IP address”. This fact is further exacerbated by the fact that many people were able to freely access the connection at the location.

Cobbler Nevada promptly moved to more traditional
identification methods
The US court have firmly established that, for a claim to be established, you “…must show… the defendant himself violated one or more of the plaintiff’s exclusive rights”. The Court quickly determined that Cobbler Nevada had not done so in this case. As discussed above, their internal investigations yielded no confirmed result, and clearly led to unsubstantiated allegations of infringement. The claim was later amended to simply refer to the IP address and no particular defendant, which still left the claim with no clearly identified infringer.

The second claim revolved around contributory infringement, i.e. that Mr Gonzales had encouraged or facilitated the infringing activities using his network connection. To put into more concrete terms: "...one who, with knowledge of the infringing activity, induces, causes or materially contributes to the infringing conduct of another". Cobbler Nevada claimed that Mr Gonzales had failed to adequately police his Internet connection, especially in the light of several notices sent to him regarding the matter. The Court, yet again, dismissed this allegation out of hand, as the perfunctory allegation does not sufficiently link him to the alleged infringement. The courts have previously denied contributory liability merely through the possibility of the use of a technology to infringe in Sony Corporation v Universal City Studios (more on which here), which similarly would apply to an open Internet network.

Contributory infringement requires two strands of liability: (i) actively encouraging (or inducing) infringement through specific acts; or (ii) distributing a product distributees use to infringe copyrights, if the product is not capable of ‘substantial’ or ‘commercially significant’ non-infringing uses.

Cobbler Nevada lacked any allegations that Mr Gonzales had infringed along the first strand. They had done no acts to encourage anyone to infringe any rights, or materially contributed to the same. Similarly his Internet service was not capable of distributing a product or service that is not capable of substantial or significant non-infringing uses. The Court noted that Internet service owners should not have an affirmative duty to actively monitor their Internet connection.

The Court ultimately dismissed Cobbler Nevada's claim.

The case is an important milestone in establishing firmer rules of identification on the Internet. Should we simply use the closes possible approximator of liability we could expose swathes of people to direct or indirect liability, which is clearly not the intention of the legislation. While the lack of certainty in using IP addresses to identify potential infringers has been established before, this is an important reminder of the fact. Even so, infringers could face liability when identified via an IP address, so the decision is by no means absolution for the wicked.

14 August, 2018

No Free-For-All - Is Posting a Freely Available Image Online Copyright Infringement?

Posting images online, whether it is on your own website or otherwise, is so easy these days and often feels quite harmless. The lack of effort and often consequence for the copying and sharing an image, even if protected by copyright, can lead to what feels like a dissemination near free-for-all on intellectual property on the Internet. With this in mind, where does one draw the line on what is allowed and what isn't, and how do we assert control over any unauthorised sharing, even if your content is freely available on different websites? The CJEU took on this question early this month, and handed down a decision that has prompted a great deal of discussion in the general public.

The case of Land Nordrhein-Westfalen v Dirk Renckhoff concerned a photograph taken by Mr Renckhoff. This picture was exclusively licenced to an online travel portal for use, and had no restrictions on the website where it was posted. In 2009 a school student in Waltrop (within the Nord Rhine-Westphalia region of Germany) used the image in their presentation, which was subsequently posted on the school's website. Mr Renckhoff subsequently sued the school district for copyright infringement for the posting of the image on the school's website.

Only one question was referred to the CJEU, which asked "…whether the concept of ‘communication to the public’, within the meaning of Article 3(1) of Directive 2001/29, must be interpreted as meaning that it covers the posting on one website of a photograph which has been previously published without restriction and with the consent of the copyright holder on another website".

As many will be aware, 'communication to the public' includes two cumulative criteria that need to be considered: (i) an act of communication; and (ii) the communication of that work to a 'public'.

The first criterion simply concerns an act where "…a work is made available to a public in such a way that the persons forming that public may access it, irrespective of whether or not they avail themselves of that opportunity". The Court swiftly determined that the posting of the work on the school's website did amount to 'an act of communication'.

The danger of copyright infringement made the creation of
school presentations all the more thrilling
In terms of the second criterion, a 'public' "…covers all potential users of the website on which the photograph is posted, that is an indeterminate and fairly large number recipients". Again, the Court quickly determined that the act had been a communication to a 'public' under this definition. However, the Court did note that for the act to be an infringing 'communication to the public' it needs to be done so to a 'new public', i.e. "…a public that was not already taken into account by the copyright holders when they authorised the initial communication to the public of their work".

Looking at the right to prevent the unauthorized communication of works, the Court saw that "…[s]uch a right of a preventive nature would be deprived of its effectiveness if it were to be held that the posting on one website of a work previously posted on another website with the consent of the copyright holder did not constitute a communication to a new public". The Directive, under Article 3(3), does not exhaust the rights held in works once they have been communicated to the public by the rightsholder or an authorized third-party.

Ultimately they concluded that the communication of a work in a separate website would amount to a communication to a new public under the Directive, as the publication of the work was only intended for the users of the authorized website, and no other third-party sites. Limitations on the copying or use of the particular work are irrelevant in this assessment.

The Court did, however, have to navigate the issues set by their earlier decision in Svensson and BestWater (discussed more here and here), which allowed for the sharing of links to content that was freely available, as the intended public for those works was, in essence, the entirety of the Internet.

The cases were distinguished as they related to hyperlinks, and not copies of available works. The former is required for the proper operation of the Internet, whereas works themselves would not contribute to this aim to the same extent. Hyperlinks can also be disabled by the removal of the website it links to; whereas once an image has been copied elsewhere its removal is much harder. The Court therefore clearly emphasised the preventative nature of their conclusion, rather than the imposition of arbitrary preclusions to the sharing of content (innocent or not).

In short, the Court concluded that "…the concept of ‘communication to the public’… must be interpreted as meaning that it covers the posting on one website of a photograph previously posted, without any restriction preventing it from being downloaded and with the consent of the copyright holder, on another website".

The decision is somewhat unsurprising, as the exhaustion of rights through the posting of any content on an authorized website would be devastating to many creating industries. The Court upheld the rightsholder's rights in their works, even if posted innocently on a school website. The case did briefly discuss exemptions relating to education and research, and one has to note that this was not a big part of the case and therefore not discussed at length. Any such use as in the case would most likely be fair use; the Court simply made sure that no rights were exhausted even if this were the case.

07 August, 2018

But I've Done Nothing Wrong! - Can You Infringe a Trademark Without Using the Trademark At All?

Quite often the simple use of a mark will amount to trademark infringement (to put things very simply). While there is some level of uncertainty that related to the specific assessment of infringement, many practitioners have no problems establishing trademark infringement when a particular mark is used by an unauthorised third-party. Even with that in mind, a recent case in the CJEU has challenged the simplicity in assessing trademark infringement; can you infringe a mark without ever using it? This puzzling question landed on the CJEU's desk late last month, which sets an interesting precedent for future infringement cases.

The case of Mitsubishi Shoji Kaisha Limited v Duma Forklifts NV concerns the sale of Mitsubishi forklifts, for which Mitsubishi's European arm has the exclusive rights to. The forklifts of course include the Mitsubishi logo, which the company has had as a registered trademark for nearly 20 years (EUTM 117713), and its name. Duma is a company that specialises in the sale of new and second-hand forklifts, including some under its own brands, and historically operated as the sub-dealer for Mitsubishi forklifts in Belgium. Since then Duma parallel imported Mitsubishi forklifts from outside the EEA to Europe, without authorisation, removing all signs from them identical to ones owned by Mitsubishi, and bringing them up to spec under EU regulations. All identification plates and serial numbers were also replaced. Mitsubishi took Duma to court over trademark infringement over the matter, with the case ending up all the way at the CJEU this summer.

The referring court asked the CJEU two questions, which it considered together, asking in essence "…whether Article 5 of Directive 2008/95 and Article 9 of Regulation No 207/2009 must be interpreted as meaning that the proprietor of a mark may oppose a third party removing all the signs identical to that mark and affixing other signs, without its consent, on products placed in the customs warehouse… with a view to importing them or trading them in the EEA where they have never yet been marketed". The articles are identical, so we're only concerned with the interpretation of the newer 2009 Regulation.

The Regulation, as decided in the Davidoff case, allows for the marketing of goods outside the EU, as is the case here, without losing your rights in the EU to those goods and the marks they bare, so long as those marks are registered within the EU. The Regulation also affords the proprietor the right to protect those rights within the EU against third parties, should they employ an identical mark in the marketing and/or selling of the goods in the EU.

After chiselling the badge off of his car for an hour
Tony realized it was a big mistake
What makes this case tricky is the removal of all Mitsubishi marks from the forklifts, and necessary modifications to comply with EU law, before they are imported into the EU. The court did, however, consider that the removal of the marks "…deprives the proprietor of that trade mark of the benefit of the essential right… to control the initial marketing in the EEA of goods bearing that mark". The placing of new marks on the goods also, according to the court, adversely affects the functioning of the original mark in the EU. The court considers that, as discussed in the TOP Logistics case "…any act by a third party preventing the proprietor of a registered trade mark in one or more Member States from exercising his right to control the first placing of goods bearing that mark on the market in the EEA, by its very nature undermines that essential function of the trade mark" (emphasis added). Clearly the court's thinking is that the act of removal should be reserved only for the proprietor of the mark, and Duma undertaking to do so undermines the function of that mark, or at least the choice in the use of the mark in the territory by the proprietor.

The Court also noted that consumers could identify the forklifts simply from their outwards appearance, and the removal of the marks from those goods and the subsequent harm to the marks would only be accentuated by that fact.

The removal of the mark additionally precludes the proprietor "…from being able to retain customers by virtue of the quality of its goods and affects the functions of investment and advertising of the mark where, as in the present case, the product in question is not still marketed under the trade mark of the proprietor on that market by him or with his consent". The placing of the goods without the mark further highlights the Court's reluctance to allow for the choice of introducing the goods to the market to be taken away from the proprietor by a third-party. They also emphasise the loss in reputation and economic value, among other things, due to the removal and subsequent marketing/sale of the goods in the EU by the third-party, and not by the proprietor.

The Court noted that the removal of the marks is also, in their view, a way to try and avoid the possibility of the prevention of the goods' importation into the EU by the proprietor, further adding to their reluctance to take away power from the proprietor (and therefore preventing distorted competition).

Importantly, the Court saw that the in concept of 'use in the course of trade' (a key component in establishing infringement) "…an operation consisting, on the part of the third party, of removing signs identical to the trade mark in order to affix its own signs, involves active conduct on the part of that third party, which, since it is done with a view to importing those goods into the EEA and marketing them there and is therefore carried out in the exercise of a commercial activity for economic advantage… may be regarded as a use in the course of trade". This only emphasises the removal of the choice from the proprietor, and the Court is clearly protecting the ability to do so for the proprietor, and also the easy avoidance of trademark infringement.

In short: "…Article 5 of Directive 2008/95 and Article 9 of Regulation No 207/2009 must be interpreted as meaning that the proprietor of a mark is entitled to oppose a third party, without his consent, removing all the signs identical to that mark and affixing other signs on the products placed in the customs warehouse, such as in the main proceedings, with a view to importing them or trading them in the EEA where they have never yet been marketed".

The decision is definitely an oddity, but to this writer at least, is clearly a marker being put down by the Court to protect the interests and rights of trademark holders, and to prevent the avoidance of infringement through the removal of registered marks from goods. What makes the decision weird is that the Court is saying that the removal of marks equates to the use of an identical trademark, even though no such mark exists on the goods themselves. In the end, it seems like the decision is one that will stand out, particularly from a trademark infringement perspective, and it will be interesting to see whether the decision will have more significant impact than you would initially think.

31 July, 2018

KitKat Cut - The KitKat Shape Trademark Ultimately Rejected by CJEU

The KitKat shape trademark saga has been detailed on this blog in great detail, going back several years (e.g. here, here and here). The fight over the chocolate bar shape seems to have gone on forever, and this writer thought he would be old and grey before the matter ultimately concluded. After Advocate General Wathelet's opinion in April, the CJEU has finally taken the matter on, and the decision will decide the fate of the current KitKat shape registration.

While the facts of the case have been discussed extensively, it is still useful to recite the basics to anyone not familiar with the background. The case of Société des produits Nestlé v Mondelez UK Holdings & Services concerns the registration of the shape of the KitKat chocolate bar (EUTM 2632529), owned by Nestle. Cadbury challenged the registration, seeking to invalidate it, with the matter ending up with the CJEU 11 years later.

The case revolves around Article 52(2) of the CTM Regulation, which allows for the registration of marks that have acquired distinctiveness through the use of the mark in conjunction with the goods or services. The distinctive character of the mark has to exist in the entirety of the EU for it to avoid invalidation.

What underpinned the matter was whether evidence has to be proved for the entirety of the EU, and not just a select sample of countries. In the case of August Storck KG v OHIM, the CJEU saw that a mark can be registered under Article 7(3) (which has to be read in conjunction with Article 52 above) "…only if evidence is provided that it has acquired, in consequence of the use which has been made of it, distinctive character in the part of the [EU] in which it did not, ab initio, have such character". If no distinctiveness exists in relation to the mark from the very beginning, acquired distinctiveness would have to be shown in the EU.

When it comes to acquired distinctiveness, the Court emphasised that, for any mark devoid of inherent distinctiveness, "…evidence be submitted, in respect of each individual Member State, of the acquisition by that mark of distinctive character through use, the evidence submitted must be capable of establishing such acquisition throughout the Member States of the European Union". Evidence therefore does not have to be produced for each individual Member State, but can be produced in a way that shows acquired distinctiveness due to proximity in geography, culture or linguistics, and therefore acquired via another Member State even in the absence of evidence for that particular Member State.

The assessment of whether the evidence produced is enough to give the mark acquired distinctiveness in the EU is a matter for the EUIPO or its appellate courts in any given case.

The CJEU agreed with the General Court's decision, which rejected the argument by Nestle that the evidence covered the entirety of the EU, or a substantial part of it, leading to sufficient coverage. The Court therefore rejected all of Nestle's appeals, and the mark was invalidated.

The decision is a huge culmination of years of litigation, but by no means is the end of the KitKat shape trademark. While evidence was lacking for the current registration with regards to Belgium, Ireland, Greece and Portugal, Nestle are still within their rights to apply for a new registration, producing evidence to cover any missing Member States. Due to the clear monetary value of the mark, it is clear that Nestle will pursue to register the shape one way or another; however, this might just be the beginnings of a reboot for this particular litigation series

24 July, 2018

Victory Plain and Simple - Australia Triumphs on Tobacco Plain Packaging Law Challenge at WTO

Discussion around plain packaging laws in relation to tobacco products has gone quite in recent times, and the slow movement towards more plain packaging laws hasn't helped this movement. Nevertheless, this blog has discussed the topic to some degree (more here, here and here), and one particular issue in the back burner has been a WTO challenge against the Australian plain packaging legislation. The matter started nearly 5 years ago, and only recently found its ultimate conclusion. The decision by the WTO panel is a behemoth at nearly 900 pages, so this blog post will endeavour to only focus on the main parts, rather than summarise the whole decision. For anyone wanting to know more, please refer to the full decision.

By way of a primer, the case of Australia v Indonesia and others concerned WTO proceedings with regards to the Australian Tobacco Plain Packaging Act 2011, which set certain rules on the packaging of tobacco products. According to Indonesia (and other countries such as Honduras, Cuba and the Dominican Republic) the law contravenes a number of WTO agreements, including the TRIPS Agreement, TBT Agreement and GATT 1994.

The panel first looked at whether the Australian Act contravened Article 2.2 of the TBT Agreement, which prohibits regulations that create unnecessary obstacles for trade that go beyond what's necessary to protect a legitimate objective, including "…protection of human health or safety, animal or plant life or health, or the environment". The panel concluded that the objective of protecting people's health by reducing smoking rates, as put forth by Australia, was a legitimate objective, and didn't restrict trade beyond achieving that legitimate objective (although did potentially restrict trade volumes). They made a 'meaningful contribution' to those ends, and the risk of the non-fulfilment of the objectives by declaring the measures unlawful under Article 2.2 would potentially have grave consequences.

Tobacco manufacturers yearn for the 'good old days'
In relation to the arguments under Article 15 of the TRIP Agreement, which prevents the prohibition of the registration of trademarks where the application of the mark would form an obstacle for registration of the mark. The panel rejected this argument, as the Act does not prevent the registration of marks, even if might impact the level of protection to those marks. They can be registered just as well, just not applied to tobacco products. In terms of Article 16.1 of the TRIPS Agreement, the panel saw that the reduced likelihood of confusion between brands was not an infringement of the article, as "…Article 16.1 does not require Members to refrain from regulatory measures that may affect the ability to maintain distinctiveness of individual trademarks or to provide a "minimum opportunity" to use a trademark to protect such distinctiveness". Article 16.1 is only concerned with the rights afforded to rightsholders relating to trademarks, and not their efficacy (or reduction thereof) through legislation. Rightholders still have the capability to prevent unauthorized use of identical or similar tobacco trademarks on identical or similar products where such use would result in a likelihood of confusion.

Similarly, the Panel saw that Article 16.3 was not infringed either (mandating the protection of 'well-known' trademarks), as the possibility of a reduced knowledge of previously well-known trademarks in the market does not, in itself, constitute a violation of Article 16.3. The panel emphasised that "…Article 16.3 does not require Members to refrain from taking measures that may affect the ability of right owners to maintain the well-known trademark status of individual trademarks, or to provide a "minimum opportunity" to use a trademark in the market".

The Panel then moved onto Article 20 of the TRIPS Agreement, which prevents the unjust encumbering of trademark use through special requirements. They ultimately concluded that Australia's public policy considerations offered an appropriate intervention in the use of tobacco related trademarks through special requirements, i.e. plain packaging. The Panel acknowledged the economic value in the trademarks themselves, but the efforts to curb smoking in Australia through plain packaging have had a genuine impact on smoking rates, and are therefore justifiable under Article 20.

Ultimately the panel saw no infringement of Australia's international obligations under the treaties, and allowed the law to stand.

The decision goes into great detail in many aspects of trade and international legislation surrounding trademarks – well beyond what this blog can, and should, discuss. The decision is hugely important, and will undoubtedly encourage other countries in their adoption of plain packaging measures. Honduras has already stated that they have appealed the decision, so the plain packaging saga will go on for a further number of years, due to the sheer value of the marks and brands at stake.

Source: BBC News

18 July, 2018

A Barrel of Joy - CJEU Sets Limits on the Assessment of Infringement of Geographical Indicators

Whisky is a point of pride for Scotland (enough where the addition of an extra letter gets some people's blood boiling), and as such there is a huge incentive to protect both the product and its name. This blog recently discussed a case in the European courts where the very name was the focus of the matter, and after an opinion from Advocate General Øe, the case has finally ended up on the lap of the CJEU, which gave its judgment only last month.

As a short primer, the case of Scotch Whisky Association v Michael Klotz concerned the sale of a whisky called "Glen Buchenbach" by Mr Klotz, which was produced in Germany. The name is derived from the Buchenbach, a valley in Swabia, and the addition of the word 'Glen' at the front of it. The Scotch Whisky Association, whose objectives include protecting the trade in Scottish whisky both in Scotland and abroad and the use of the PDO for whisky. The SWA objected to the use of the word 'Glen' in conjunction with a whisky not originating from Scotland.

The referring court asked the CJEU four different questions, all of which related to the Geographical Indications Regulation.

The first question, in essence, asked whether "…Article 16(a) of Regulation No 110/2008 must be interpreted as meaning that, for the purpose of establishing that there is ‘indirect commercial use’ of a registered geographical indication, the disputed element must be used in a form that is either identical to that indication or phonetically and/or visually similar to it, or whether it is sufficient that that element evokes in the relevant public some kind of association with the indication concerned or the geographical area relating to it".

The court determined that, for the use to be covered by Article 16(a), the use needs to be in an identical form or at least in a form that is phonetically and/or visually highly similar to the geographical indicator. The use, however, still can be both direct and indirect to potentially fall under the provision. The Advocate General distinguished the uses as "…‘direct’ use, which implies that the protected geographical indication is affixed directly to the product concerned or its packaging, ‘indirect’ use requires the indication to feature in supplementary marketing or information sources, such as an advertisement for that product or documents relating to it".

With this in mind, the court still rejected the argument that all that is necessary is a simple association in the mind of the relevant consumer for there to be infringement. This would deprive Article 16(b) of any practical effect (the provision precludes any "any misuse, imitation or evocation" of a GI), and therefore should not be applicable to Article 16(a). A simple 'impression' would also fail in being indirect use, which would not be identical or phonetically/visually similar to the GI being protected. A simple 'association in the minds of the public' would not be an infringement.

Glenn's budding fake beverage business took a beating that night
The court then moved onto the second question, which asked "…whether Article 16(b)… must be interpreted as meaning that, for the purpose of establishing that there is an ‘evocation’ of a registered geographical indication, the disputed element must be phonetically and/or visually similar to that indication, or whether it is sufficient that that element evokes in the relevant public some kind of association with the indication concerned or the geographical area relating to it". The question focusses on the context of the use of the mark, and not just the mark itself, i.e. what the impression is that the mark gives in its full context to the relevant consumer, or the use of wording that associates the goods with a GI.

Previous case law, particularly the case of Viiniverla, has determined that 'evocation' covers situations where "…the term used to designate a product incorporates part of a protected [GI], so that when the consumer is confronted with the name of the product in question, the image triggered in his mind is that of the product whose indication is protected". This is assessed through a decision on the presumed reaction of the consumers in the light of the term used, and that there is a link between the term and the GI. The appearance of the goods and the similarity of the name and the GI can be taken into account.

In short, the court set out that "…for determining whether there is an ‘evocation’ within the meaning of Article 16(b)… the decisive criterion is whether, when the consumer is confronted with a disputed designation, the image triggered directly in his mind is that of the product whose geographical indication is protected… taking into account, as the case may be, the partial incorporation of a protected geographical indication in the disputed designation, any phonetic and/or visual similarity, or any conceptual proximity, between the designation and the indication". They did, however, reject the argument that evocation as to geographical region should be included, as this does not create a sufficient link with the GI and the goods being sold.

The court did also reject the argument of including context within the assessment, setting out that "…for the purpose of establishing that there is an ‘evocation’ of a registered geographical indication, account is not to be taken either of the context surrounding the disputed element, or, in particular, of the fact that that element is accompanied by an indication of the true origin of the product concerned".

Finally the court moved onto the third question, which asked "…whether Article 16(c)… must be interpreted as meaning that, for the purpose of establishing that there is a ‘false or misleading indication’, as prohibited by that provision, account must be taken of the context in which the disputed element is used, in particular where that element is accompanied by an indication of the true origin of the product concerned".

After brief consideration, the court set out that "…Article 16(c)… must be interpreted as meaning that, for the purpose of establishing that there is a ‘false or misleading indication’, as prohibited by that provision, account is not be taken of the context in which the disputed element is used". This follows their logic in the above question, where context was also disregarded. The addition of further information, and therefore avoiding infringement through its inclusion, could compromise the protection offered by GIs.

Overall the decision is important, particularly in establishing the remit through which GI infringement is assessed. Thinking of the issues further, this writer agrees with the court, as the inclusion of context could indeed compromise the protection offered, and allow for the sale of 'infringing' goods with enough contextual information to avoid infringement (whether consumers notice it at all or not).

27 June, 2018

A Terrible Cover-Up - Addition of a Small Label is not Repackaging (and Doesn't Infringe TMs), says CJEU

Repackaging branded goods can be a legitimate way to resell branded goods in a different jurisdiction, avoiding the potential confusion of where the goods actually originate from (and whether they are counterfeit). The allowance is still a tough line to toe, particularly when minimal efforts are taken to repackage the relevant goods. In the light of this, what amounts to repackaging, and what would be a potential minimum standard for repackaging so as to avoid trademark infringement in the EU? Luckily, the CJEU was poised to answer this question in a case that was decided last month.

The case of Junek Europ-Vertrieb GmbH v Lohmann & Rauscher International GmbH & Co KG concerned the sale of medical dressings made by Lohmann, sold under the brand "Debrisoft" (TM No. 8852279). Junek parallel imported and sold sanitary preparations in Austria, including Debrisoft products. In a package of Debrisoft, purchased by Lohmann in Austria, Junek had affixed a label onto the box that contained its address and telephone number, a barcode and a central pharmaceutical number. The label was applied to a non-printed part of the packaging. Junek had not notified Lohmann of the reimportation of the products, nor had they supplied Junek with the modified packaging. Lohmann then took Junek to court for trademark infringement.

The referring court set out a single question for the CJEU, which, in essence, asked "…whether Article 13(2) of [the CTM Regulation] must be interpreted as meaning that the proprietor of a mark may oppose the further commercialisation, by a parallel importer, of a medical device in its original internal and external packaging when an additional label, such as that at issue in the main proceedings, has been added by the importer". Additionally the court asks whether the principles in the cases Bristol-Meyers Squibb and Boehringer Ingelheim apply without restrictions to parallel imports of medical devices.

When it comes to repackaging of goods, the Court emphasised that any repackaging done by a third party without the proprietor's consent could create a risk in terms of the guarantee of origin of the goods. Even so, original proprietors cannot prevent the importation of repackaged goods simply to derogate from the free movement of goods, although the repackaging should not adversely affect the original condition of the goods or the reputation of the mark.

When repackaging, be honest
The CJEU has previously in the above two cases set out the principles under which exhaustion of rights operates in relation to parallel imports. A proprietor can oppose the further commercialisation of pharmaceutical products imported from another Member State in its original internal and external packaging with an additional external label applied by the importer, unless:

(i) it is established that the use of the trade mark rights by the proprietor thereof to oppose the marketing of the relabelled products under that trade mark would contribute to the artificial partitioning of the markets between Member States; (ii) it is shown that the repackaging cannot affect the original condition of the product inside the packaging; (iii) the new packaging states clearly who repackaged the product and the name of the manufacturer; (iv) the presentation of the repackaged product is not such as to be liable to damage the reputation of the trade mark and of its owner; thus, the packaging must not be defective, of poor quality, or untidy; and (v) the importer gives notice to the trade mark proprietor before the repackaged product is put on sale, and, on demand, supplies him with a specimen of the repackaged product.

In the light of the above, 'repackaging' of goods also includes relabeling the products bearing the mark.

The Court distinguished the current case from the facts of Boehringer Ingelheim, which dealt with repackaging, albeit both affixing an external label and opening the packaging and inserting an information leaflet. In contrast, Junek had only affixed a small label on the outside of the packaging, which didn't obscure the mark or any other details. The Court concluded that their actions therefore would not amount to repackaging as set out in Boehringer Ingelheim. Due to this the Court precluded Junek from preventing the importation of the goods to the Member State.

The Court summarised its answer to the question as "… Article 13(2)… must be interpreted as meaning that the proprietor of a mark cannot oppose the further commercialisation, by a parallel importer, of a medical device in its original internal and external packaging where an additional label… has been added by the importer, which, by its content, function, size, presentation and placement, does not give rise to a risk to the guarantee of origin of the medical device bearing the mark".

Clearly the Court drew a line in the impact a small label could have to the guarantee of origin of goods, as it does not affect the consumer's knowledge of the origin or the contents of the package. One can indeed appreciate this common sense approach, as the prohibition of the addition of a parallel importer's details could also result in the impossibility of resolving any issues with the product when imported separately from the original proprietor.

12 June, 2018

Well Red - Louboutin's Red Shoe Sole TM is Registrable, Says CJEU

The build-up with the Louboutin red sole case has been quite extensive and unique in that Advocate General Szpunar had to give not one, but two opinions on the case ahead of the CJEU's decision (discussed more here and here). There was some degree of uproar with the latest opinion, and hence many trademark practitioners have been salivating at the prospect of the CJEU decision, which could have quite a bit of an impact on the current trademarks regime in Europe. With that in mind, the decision has finally been released by the CJEU earlier this week.

Even though the facts of Christian Louboutin v Van Haren Schoenen BV have been discussed extensively on this blog, they are worth revisiting. The matter concerned a trademark registration (TM 0874489) in Benelux for a red colored sole on a women's high-heeled shoe by Christian Louboutin. The mark consisted of the color on the sole of the shoe, but did not take into account the contours of the shoe, which only served an illustrative purpose on the positioning of the mark. Van Haren sold a similar red soled shoe in the Netherlands, for which they were sued by Louboutin for trademark infringement. The mark was contested by Van Haren, and ultimately ended up with the CJEU.

The referring court asked, in essence, "…whether Article 3(1)(e)(iii) of Directive 2008/95 must be interpreted as meaning that a sign consisting of a colour applied to the sole of a high-heeled shoe… consists exclusively of a ‘shape’, within the meaning of that provision".

Stephanie had to forget her 'totally unique' shoe design
after the decision
The Court initially affirmed that EU legislation generally accepts that the 'shape' of a trademark within the meaning of Article 3(e), means a set of lines or contours that outline the product concerned, potentially excluding any colors that don't have an outline defining said 'shape'. Any marks that merely consist of that shape would be deemed invalid.

Nonetheless, the Court did determine that "…while it is true that the shape of the product or of a part of the product plays a role in creating an outline for the colour, it cannot, however, be held that a sign consists of that shape in the case where the registration of the mark did not seek to protect that shape but sought solely to protect the application of a colour to a specific part of that product". This would exclude any signs that merely apply a color to an apparent shape from the remit of Article 3(e), such as the shoe in the Louboutin trademark.

If the shape of the shoe is excluded from the mark, the Court considered that the mark therefore could not exclusively consist of a shape, as the main element of that sign is a specific colour designated by an internationally recognised identification code (in this instance Pantone 18‑1663TP).

In short, the Court concluded that "…Article 3(1)(e)(iii)… must be interpreted as meaning that a sign consisting of a colour applied to the sole of a high-heeled shoe… does not consist exclusively of a ‘shape’, within the meaning of that provision".

The case is quite important, as the registration of a trademark for a color, excluding any shape that is used to illustrate the placement of the color, would be allowed under the ruling. The decision completely ignored the AG's considerations of reputation and the addition of value through the introduction of the mark, which were the main points that many found contentious. Whether this omission will be challenged in future case law remains to be seen.

05 June, 2018

A Fortine at the PUBG - Can You Protect a Video Game Format?

Video games have effectively become mainstream entertainment during this writer's lifetime, and with that increased popularity their value to companies has also gone up. If one video game becomes popular, other developers often jump at the chance of taking advantage of the popularity with their own spin. An example of a recent explosion in video game types are battle royale games, where several players fight for survival with limited resources, with the last person standing winning that particular session. The two most popular ones are PUBG (PlayerUnknown's Battlegrounds) and Fortnite, developed by PUBG Corporation and Epic Games respectively. As the two battle royale titans battle it out for popularity, there is a risk of lawsuits going either way to protect their interests.

According to the Korean Times, PUBG have filed a lawsuit against Epic Games for copyright infringement in Korea, alleging that "…Fortnite was copied from… PlayerUnknown's Battlegrounds", including replicating the 'experience' for which PUBG is known, including the game's 'core elements' and user interface. PUBG have raised concerns over replication as early as September 2017, when Fortnite's battle royal mode was announced, including over Fortnite's "…User Interface, gameplay and structural replication in the battle royale mode". PUBG are, however, licensees of Epic Games' Unreal Engine 4, which adds yet another layer of complications into the mix, and a potential pitfall for PUBG in their claim.

While it is unclear, at least to this writer, how the Korean courts will deal with a claim concerning the claims on video game formats (any readers with further knowledge should let me know!), how do other jurisdictions deal with these questions?

PUBG's lawyers had a dream
about the wording of the court ruling
There has been very little video game related litigation in the UK. The most recent one, Nova Productions Ltd v Mazooma Games Ltd, dates back to 2006. In the case the UK Court of Appeal saw that "…Not all of the skill which goes into a copyright work is protected... An idea consisting of a combination of ideas is still just an idea. That is as true for ideas in a computer program as for any other copyright work". The court's emphasis was on the lack of protection for the ideas surrounding a game, which could, at least in this writer's view, preclude the protection of video game formats like battle royale.

In the US the situation is slightly different. In Tetris Holding LLC v Xio Interactive the New York District Court found that a Tetris clone had infringed the copyright in the work, although protection was largely extended only due to the similarities in aesthetics between the games. The underlying rules of the game (i.e. format, one could argue) can be protected only if the expression of those rules is somehow limited, or isn't part of scènes à faire. Similarly, in DaVinci Editrice SRL v Ziko Games LLC, the District Court of Texas decided that "…the rules, procedures, and limits that make up the game play are not protectable expression". To add more fuel to this fire, the US Copyright Office has set out that "…Copyright does not protect the idea for a game… or the method or methods for playing it. Nor does copyright protect any idea, system, method, device, or trademark material involved in developing, merchandising, or playing a game". One can appreciate that the American system protects the aesthetic expression of a video game (and arguably rightfully so), rather than the rules under which it operates.

Clearly the protection of a video game format, i.e. the rules that underpin the game itself, are very difficult to protect, particularly under copyright. While this writer does not know what the Korean regime is for copyright in this area, it seems very doubtful that it would be very different from the above. As both PUBG and Fortnite differ dramatically in their aesthetics (although a more detailed analysis of all elements of each game could yield some infringing elements), it would seem that PUBG have more to lose than just a copyright lawsuit should things go badly.

30 May, 2018

A New Intelligence - UK House of Lords Releases Report on Artificial Intelligence

Artificial intelligence is absolutely a hot button issue these days, particularly with a focus on what's coming in the near and more distant future and AI's potential impact on people's lives (both in the good and the bad).  This writer is very interested in AI, having recently published an article discussed the same in relation to copyright, and in that vein was quite thrilled with the release of the House of Lords' report on AI last month. The report is very detailed and discusses many facets of the technology and its potential impact, but what potential recommendations does the report give from a legal perspective?

The Report (titled AI in the UK: ready, willing and able?) considers the development, implementation and impact of AI in the UK in the future, and recommends that the government take certain actions sooner rather than later. This article will endeavour to focus on some of the more interesting, potentially IP specific issues, and general law considerations.

A big point in the Report is the mitigation of risks associated with AI. Largely this relates to any assumed liability for an AI's actions, negligence or malfunction, which, as the law stands, is not covered. The Report does recommend that "…the Law Commission consider the adequacy of existing legislation to address the legal liability issues of AI and, where appropriate, recommend to Government appropriate remedies to ensure that the law is clear in this area. At the very least, this work should establish clear principles for accountability and intelligibility". Without accountability, one could imagine AI skirting liability, and causing potential issues for those wishing to pursue any damages resulting from an AI's decisions.

The consideration of liability ties into the matter of whether AI should be treated the same as humans, or have separate legal or non-legal entity status. For example, should IP rights be awarded to the AI, or the AI's creators (more on which here)? Both paths have their issues, but the Report fails to address this aspect in detail.

Another point of contention in the Report is the amassing of data by large corporations, which would therefore, in a way, control the development of AI and the marketplace for the same. The Report encourages that "…publicly-held data be made available to AI researchers and developers" to facilitate AI development for smaller players. Even so, it does highlight a need for "…legal and technical mechanisms for strengthening personal control over data, and preserving privacy" in the light of AI; however, this has been, at least arguably, largely achieved through the introduction of the GDPR this month.

A human future without TPS reports
In an attempt to kerb any misuses of data, or its monopolisation, the Report recommends that "…the Government, and the Competition and Markets Authority, to review proactively the use and potential monopolisation of data by the big technology companies operating in the UK". Clearly this might create a data competition framework, where companies with large swathes of data could be prevented from merging due to competition issues, or simply to prevent the centralization of requisite data for AI creation and/or operation.

The Report does discuss the IP issues with the development of AI in university settings, and the commercialization of research. As was discussed in the Hall-Pesenti Report last year, licencing of technologies could be problematic, and both the Report and Hall-Pesenti have sought to mitigate this. In this vein, the Report recommends that "…universities should use clear, accessible and where possible common policies and practices for licensing IP and forming spin-out companies", and that a policy should be drafted for Universities to enforce the same. Even so, Universities should be able to protect the know-how relating to AI, but within a reasonable framework.

Although not discussed in the House of Lords' report, the Hall-Pesenti Report also highlights a need for the reform of copyright in relation to data published in research, which would infringe copyright. This is problematic since "[t]his restricts the use of AI in areas of high potential public value, and lessens the value that can be gained from published research, much of which is funded by the public". In terms of reform the report suggests that "…the UK should move towards establishing by default that for published research the right to read is also the right to mine data, where that does not result in products that substitute for the original works". In terms of the development of AI this makes perfect sense, but when that data relates to human individuals, particularly in the light of the GDPR that just recently came into force, we should be cautious for giving AI free reign over all data. A balance needs to be struck with the interests of individuals, but the robust development of AI, provided the developments are for the public good.

As one can imagine, AI is a very difficult and potentially thorny subject, and there will be without a doubt many pitfalls we will end up in and will need to play catch-up with. Nonetheless, the potential of the technology could outweigh these issues, but maybe this writer is too optimistic in terms of AI's future.

22 May, 2018

Two Words Don't Make a Right - The Use of Two Consecutive Descriptive Terms for Goods not Distinctive as a TM

Many good things come in pairs, for example, shoes, ear plugs and twins, but sometimes even the best pairing won't be enough. This is the case even with trademarks, where the use of two terms that name or describe goods will be difficult to register. A recent case in the Canadian Trade-Marks Opposition Board considered this issue, and further highlighted that, even though a very novel argument, the marks themselves might not be as novel.

The case of Molson Canada 2005 v Drummond Brewing Company Ltd concerned a registration for the trademark "BEER BEER" (TM 1619343) for beer by the Drummond Brewing Company. Due to the quite clear descriptive nature of the mark, Molson Canada opposed the registration, even though it has been used for the goods in Canada since 2009.

The mark was opposed under sections2, 16, 12 and 30 of the Canadian Trade-Marks Act.

The Trade-Marks Opposition Board first considered the grounds under section 30(i), which requires a statement by the applicant that they are satisfied that they are entitled to use the mark in Canada in association with the relevant goods and/or services. The courts will only reject an application under the section if it has been applied for in bad faith. What plays a part in this is an earlier rejection for an application in 2009 for "BEER BEER" by Drummond Brewing due to the descriptive nature of the mark, which potentially indicates an element of bad faith for the new registration.

Donald's new beer brand: BEER BEER BEER BEER
Board Member Kathryn Barnett rejected this argument, as the provision only looks for an entitlement to use the mark, rather than any claims on rights to it. The Applicant's witness statements also indicated a clear belief in the entitlement to use the mark in Canada.

The Board then moved onto matters relating to section 12 of the Act, which prohibits the registration of mark if it, among other things, contains the name of the goods or services or that it clearly is descriptive of the quality of the goods or services relating to the mark.

The first ground under section 12(1)(c) for containing the name of the goods, i.e. beer, based on "…the immediate and first impression of the everyday user of the goods and services". This can include composite marks, including both a word and design element, if the portion of the word in the mark is dominant. The Board rejected this argument, as the mark is "BEER BEER", and not simply just 'BEER'. The name of the goods is simply the single use of the word, not double, and therefore escapes the remit of section 12(1)(c).

The Board then moved onto section 12(1)(b), which prevents the registration of clearly descriptive or deceptively misdescriptive marks from the point of view of the average consumer. The mark has to be assessed in its entirety as a matter of immediate impression to the aforementioned consumer. This is to prevent the registration of a common trade term for goods or services, placing legitimate traders at a disadvantage.

What lies at the heart of this decision is Pizza Pizza v The Registrar of Trade-marks, where the mark 'PIZZA PIZZA' was deemed to not be descriptive of the goods, namely pizza. Molson Canada contested that the phrase 'BEER BEER' would indeed be descriptive, which was, as discussed above, deemed so when applied for previously. The phrase would, in their view, describe a "…“real” or “prototypical” beer, or as a generic marking, or both".

The Board ultimately sided with the opponent, Molson Canada, and decided that the mark was indeed descriptive of the character or quality of the goods, and rejected the application. Due to this the Board deemed it unnecessary to consider the rest of the grounds of opposition.

The decision was an interesting one, and something this writer has never thought about; distinctiveness through the use of 'descriptive' terms in a novel way. While the decision makes perfect sense, it still shows that when you're creative with your marks, even the simplest thing could potentially (although not very often) be distinctive.

Source: JDSupra

01 May, 2018

Monkey Snap, Monkey Don't - US Court of Appeals Rules Out Animal Ownership of Copyright in Monkey Selfie Case

The rights of animals, whether it is simply to extend human rights to them or even legal rights, are a very contentious and often emotionally charged topic of conversation. A good example of this is the recent monkey selfie legal saga, which grappled with the vesting of intellectual property rights in a monkey (discussed more on this blog here and here). The parties settled the matter out of court late last year, but the Court of Appeals saw to still rule on the matter, irrespective of this settlement (which is within their powers to do). This is very important, since it will set the legal position of animals' rights in IP firmly on one camp; yes or no. This writer has been waiting for the ruling with baited breath, which was published only last week.

By way of a brief primer, the case of Naruto v David Slater concerned a series of photographs taken by a crested macaque in 2011 (named Naruto by its Next Friends in the litigation, PETA). The monkey took the photograph using Mr Slater's camera, which he had configured and left for the monkeys in the area to play with. One such picture became an Internet sensation, leading to Mr Slater asserting his rights in the picture as its author. PETA took the matter to court, claiming the monkey had rights in the picture, and that Mr Slater had infringed its copyrights by publishing it. Even though the parties settled the matter, as discussed above, the Court saw it fit to decide on it anyway due to its importance as a developing area of the law.

Naruto's representatives were aghast at the ruling
Judge Bea, handing down the majority's judgment, started off with determining whether PETA could represent Naruto as its next friends in the case. This is established through showing that "…(1) that the petitioner is unable to litigate his own cause due to mental incapacity, lack of access to court, or other similar disability; and (2) the next friend has some significant relationship with, and is truly dedicated to the best interests of, the petitioner". The Court agreed that Naruto would indeed fulfil the first requirement, but needed to assess whether PETA had a significant relationship with the animal. PETA agreed that it had does not claim to have a relationship with Naruto that is any more significant than its relationship with any other animal, and thus fails the second requirement.

The Court emphasised that animals do not have authorisation by the courts to be represented by a next friend. In other words "…if animals are to be accorded rights to sue, the provisions involved therefore should state such rights expressly".

Judge Bea then moved onto the matter of whether Naruto itself has standing under Article III of the Constitution. Under a previous Court of Appeals decision in Cetacean Community v Bush, the court rejected standing for "…all of the world's whales, porpoises, and dolphins" under environmental protection laws as animals were not expressly included within the provisions. In short, the court concluded that the test for animal standing as "…if an Act of Congress plainly states that animals have statutory standing, then animals have statutory standing. If the statute does not so plainly state, then animals do not have statutory standing".

Under the Copyright Act there is no express mention of any animal rights for intellectual property. The provisions do, however, imply a requirement of humanity or the possibility of marital relations. The Court did conclude that, based on the statute and the Cetacean decision, "…that Naruto - and, more broadly, animals other than humans - lack statutory standing to sue under the Copyright Act".

The case is a very important one, not only for the unusual nature of judgments being issued after settlement, but it puts the rights of animals under copyright to bed once and for all. Clearly, animals cannot have rights, and this writer considers this to be the most logical outcome, even without an express mention to that effect in the legislation. One can therefore finally see a conclusion to all of this monkey business.

24 April, 2018

Kit Kat Kontinues - Advocate General Wathelet Dismisses Appeal on Kit Kat Shape Trademark

One would've never imagine a chocolate bar could be litigated over for many years, but the Kit Kat saga has proven that even the most seemingly mundane things can be worth a tremendous monetary investment. After the EU General Court decision last year (discussed more here) you could have imagined the matter has been largely concluded. This was clearly not the case, as Mondelez appealed the decision, which has now reached the desk of Advocate General Wathelet. They issued their opinion only last week, which will give direction to the CJEU who will decide the matter once and for all later this year.

Although discussed extensively on this blog, the case still merits a short introduction. The matter Société des produits Nestlé v Mondelez UK Holdings & Services concerns the design of the Kit Kat chocolate bar, which Mondelez has registered as a trademark (EUTM 2632529). Cadbury, now Mondelez, filed for an application of invalidity regarding the mark sometime after, with the matter being decided by the General Court last year. Nestle appealed the decision (which went against them), ending up heading to the CJEU via the Advocate General.

The case on appeal hinges on the extent of the territory that you need to show distinctive character that is acquired through use of the trade mark under Article 7(3) of the CTM Regulations. In the General Court Nestle failed to show use throughout the EU, not just in a substantial part of it, and therefore the mark was invalidated.

A Kit Kat Kounterfeit
Per the decision in August Storck KG v OHIM, the CJEU set the bar for the acquisition of distinctive character through use as requiring "…evidence… that [the mark] has acquired, through the use which has been made of it, distinctive character in the part of the [EU] in which it did not, ab initio, have such character". Adding to this, the CJEU noted that an argument for acquired distinctiveness could be rejected if there is no evidence of use, as detailed above, in a single Member State. Subsequent cases have shown that partial acquisition of distinctive character within the EU is not enough, as there needs to be 'quantitatively sufficient evidence' of acquired distinctiveness.

Looking at the above, the AG did, however, not shut the door entirely on partial acquisition of distinctiveness. They added that a mark could have acquired distinctiveness in the entire EU if evidence is provided for "…a quantitatively and geographically representative sample" of the EU. This means taking into account the various links between the national markets of Member States, and whether those links negate a lack of evidence for acquired distinctiveness in the bigger picture within Europe. Potentially a more regional approach has to be taken and therefore acquired distinctiveness could be extrapolated for any missing countries, i.e. produce evidence for the Nordics and other such 'collectives' of countries if evidence for all Member States is missing for others within those 'collectives'.

Having considered the missing evidence discussed in the General Court's decision, the AG concluded that Nestle's appeal should be dismissed.

While we are still awaiting the CJEU's decision on this matter, things don't look great for Nestle, or 3D marks in general. It will be difficult for many proprietors of such marks to show acquired distinctiveness within the EU, or most of it. It remains to be seen whether the CJEU will go in a different direction, but it seems very unlikely considering the General Court's decision and now the AG's opinion.

17 April, 2018

As the Oracle Foretold - Court of Appeals Finds no Fair Use for Google's Copying of Java APIs

The Oracle/Google saga has been wagered in the courts for years (discussed on this blog here and here), and many legal scholars enthusiastic about technology have been waiting for the matter to reach its ultimate conclusion. Although the matter is not necessarily over by any means, a recent Court of Appeals decision might have struck the final blow, and ended the matter (and the question of APIs and copyright) for the time being.

The case of Oracle America Inc. v Google LLC concerned the Java software platform, which was developed by Oracle's predecessor, Sun Microsystems. The Java platform also included an Application Programming Interface (API) that allowed for the development of software using pre-written code to execute certain functions without writing the code from scratch, delivered in packages. Google had included some Java API packages in its Android operating system without Oracle's authorisation; specifically 37 Java API packages (amounting to 11,500 lines of code). Android became widely used and very popular, after which Oracle took Google to court for copyright infringement, with proceedings ending up in the Court of Appeals in late March.

The matter focussed on whether Google's copying of the APIs amounted to fair use under 17 USC section 107, which looks at four factors: (1) the purpose and character of the use, including whether such use is of a commercial nature or is for non-profit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and (4) the effect of the use upon the potential market for or value of the copyrighted work.

Justice O'Malley, handing down the majority's opinion, started with the first factor, which, specifically, looks at whether the purpose of the use was a commercial one, and was it transformative or not so as to lean towards for fair use.

In terms of commercial use, the Court considered that, while the Android platform is freely distributed (including the aforementioned APIs) does not mean the use is not commercial. Also, as Google earns money from advertising on the platform, this will weigh towards a finding of commercial use. Indeed, in the end the Court found that the use was commercial.

The second part of the first factor looks at how transformative the use is, i.e. "…adds something new, with a further purpose or different character, altering the first with new expression, meaning or message". The use would have to add something new or supersede the original work. The Court determined that Google's use did not change the APIs or their purpose, but used them for the exact same in the Android operating system. The context of the use within smartphones was also not novel. In short, the Court saw that "…where, as here, the copying is verbatim, for an identical function and purpose, and there are no changes to the expressive content or message, a mere change in format (e.g., from desktop and laptop computers to smartphones and tablets) is insufficient as a matter of law to qualify as a transformative use".

Further to the assessment of purpose and character there is also a bad faith argument that the Court considered, meaning whether Google has used the APIs "…in a manner generally compatible with principles of good faith and fair dealing". Even assuming a jury would not be convinced of Google's bad faith use of the APIs, the Court still concluded that the first factor overall weighed against a finding of fair use.

The second factor looks at the nature of the copyright work, i.e. whether the work is more factual or creative, with the latter getting a higher likelihood of protection. The Court did highlight that, while the APIs did involve some level of creativity, they ultimately were for a functional purpose. Even so, the second factor is of very little importance in a finding of fair use, per the Court, they did find that it weighed towards a finding of fair use.

The Court moved onto the third factor, which looks at the substantiality of the copying, which is more an assessment of quality rather than sheer quantity of what was copied. In retaining the functionality of the Java APIs it was necessary to copy only roughly 200 lines of code; however, Google copied nearly the entire API set of 11,500 lines of code. In brief, the Court set out that Google's copying was qualitatively significant and necessary for the creation of the Android OS, and the third factor therefore weighed against a finding of fair use.

Finally, the Court looked at the fourth factor, meaning the copy's effect on the potential market (or the market for any derivative works) or value of the original work. This includes assessing "…the extent of market harm caused by the particular actions of the alleged infringer, but also whether unrestricted and widespread conduct of the sort engaged in by the defendant… would result in a substantially adverse impact on the potential market for the original". Likely market harm can also be presumed by the courts if the use by the potential infringer is commercial and non-transformative.

The Court determined that, there was clear harm to the market in relation to smartphones, as Java had been employed in many phones and tablets at the time of the launch of Android. In the light of the evidence, they indicated that this would clearly lead to a finding of market harm by a jury. There was also impact on the potential market for Java, not just the existing market, specifically with regards to the smartphone market, which was deemed to be "…a traditional, reasonable, or likely to be developed market". Oracle's lack of development of a smartphone or smartphone OS was irrelevant, as the potential still existed for the company that was taken over by Android.

In balancing all of the above factors, the Court found that Google's use was not fair use, but the Court did note that, while this case did not reach the threshold for fair use in relation to computer code or APIs, they did not "…conclude that a fair use defense could never be sustained in an action involving the copying of computer code".

Google's cross-appeal for declaration that the APIs would not be protected by copyright was also dismissed by the Court, which was dismissed by the Supreme Court in a petition before this judgment.

The case is very interesting, in the light of potential copying within software development. From what this writer understands, the appropriation and repurposing of code is very common in the industry, and this decision could create an environment where companies would be more readily okay with pursuing copying. Google seemingly will not have the option to pursue the matter to the Supreme Court, and will end up paying significant damages to Oracle.

Source: JDSupra

10 April, 2018

An Opinion on Whisky - AG Øe Sets Boundries for Geographical Indicators and their Infringement

Having looked at the legal intricacies of using protected Geographical Indications in a recent case regarding Champagne, this writer has grown to appreciate the complexities of PDOs and the law surrounding them. What amounts to an infringement of GIs rights is very tricky, and any clarification from higher courts is always appreciated. Scotch whisky is one GI that is vehemently defended, and many third-parties would want to benefit from the image that the GI imparts, but to avoid the 'pesky' issues of actually conforming to the classification. In terms of a name for a whisky produced outside of Scotland, what amounts to an infringement of a GI? Ahead of a CJEU decision, Advocate General Øe gave their opinion of this question.

The case of The Scotch Whisky Association v Michael Klotz dealt with the production and sale of a whisky called "Glen Buchenbach" in Germany by Mr Klotz. The SWA objected to the sale of the whisky using the term 'Glen', which, in their view, referred to a geographical location in Scotland and implies the product is a Scotch whisky.  The use could potentially therefore infringe on the Geographical Indications Regulation, which protects Scotch whisky as a GI.

The German courts referred three questions to the CJEU on the matter, which were considered by the Advocate General.

The first question, in essence, asked "…what is meant by ‘indirect commercial use [of a] registered geographical indication’ for a spirit drink, within the meaning of Article 16(a) of Regulation No 110/2008".

The first part of the first question then focusses on whether "… in order to establish the existence of such use, prohibited by Article 16(a), it is necessary that the disputed indication be used in identical or phonetically and/or visually similar form to the protected geographical indication, or whether it is sufficient that the disputed indication evokes in the relevant public some kind of association with the indication or the geographical area relating thereto". In brief, this is whether the indication has to be phonetically or visually identical to the GI, or if the public associate the term with the GI without similarity (i.e. 'Glen' would be associated with Scotland, and therefore Scotch whisky).

The Advocate General determined that, under Article 16(a), the expression of 'direct or indirect commercial use' requires that "…the use is made of the disputed indication in the form in which it was registered or at least in a form with such close links to it that the sign at issue is manifestly inseparable from it". This means that the use would have to be in an identical or phonetically and/or visually similar form, and not just associated with the GI.

The Court has firmly established that 'direct' use would amount to the use of the GI, or a corresponding term or translation, in conjunction with goods that don't meet the specification. However, the Advocate General had to consider what amounts to 'indirect' use of a GI. In his view, this requires use where "…the indication… feature[s] in supplementary marketing or information sources, such as an advertisement for that product or documents relating to it". Additionally, broadening the provision would make following provisions, such as Article 16(b), redundant, and has to therefore be kept narrower, and won't cover cases of mere association by the public. This interpretation supports the interpretation of the objectives of the Regulation and the Article, which clearly seek to protect GIs from misuse, and to ensure quality of the goods.

The AG probably needed a drink after the case
In terms of the second part of the first question (additional information in relation to an 'association' with a GI in the minds of the public), the Advocate General swiftly concluded that the Court would not have to rule on the point, in the light of the above, but he did make brief observations on the same. In his view there is no ambiguity under the provision on what amounts to infringement, which differs from Article 16(b) that is not at issue in the matter. The Advocate General added that, in considering any "misuse, imitation or evocation" under Article 16(b), a court could take into account the context where the disputed indicator is used, and the same would apply if the Court would consider 'association' as a possibility under Article 16(a).

The second question, split into two parts as well, asks clarification on "…the concept of ‘evocation’ of a registered geographical indication relating to a spirit drink, within the meaning of Article 16(b)".

As with the first question, the first part of the second question asks whether, in determining the existence of 'evocation' "…the disputed designation must be in an identical or phonetically and/or visually similar form to the protected geographical indication, or whether it is sufficient that the designation evokes in the relevant public some kind of association with that indication or the geographical area relating to it".

Having considered relevant case law, the Advocate General concluded that for the purposes of identifying an ‘evocation’ "…the only determining criterion is whether, ‘when the consumer is confronted with the name of the product, the image triggered in his mind is that of the product whose designation is protected’, which the national court must verify by taking into account, as appropriate, the partial incorporation of a protected name in the disputed designation, a phonetic and visual relationship, or a conceptual proximity". He also outright rejected the concept of evocation in relation to a mere association with the GI in the might of the relevant public.

As above, the second part deals with the existence of 'evocation' and whether it has to be determined looking at the use in isolation, or whether the context of the use can be taken into account. Having briefly discussed the matter, the Advocate General concluded that "…for the purposes of establishing the existence of an ‘evocation’… it is not necessary to take account of additional information found alongside the sign at issue in the description, presentation or labelling of the product concerned, in particular with regard to its true origin". That is because this information is largely irrelevant in the assessment, and that 'evocation' can exist even in the absence of confusion in the relevant public.

Finally the Advocate General considered the third question, which asked, in essence, "…whether, for the purposes of determining whether there is ‘any false or misleading indication… liable to convey a false impression as to its origin’, within the meaning of Article 16(c)… it is necessary to take account of the context in which the disputed element is used, in particular where the disputed element is accompanied by an indication of the true origin of the product". The question concerns the use of the name 'Glen', whether its use is false or misleading, and if its use in context can be taken into account (i.e. the use of a German location, Buchenbach, after the name).

Having considered all parties' arguments extensively, the Advocate General determined that "…for the purposes of establishing the existence of a ‘false or misleading indication’ prohibited by [Article 16(c)], it is not necessary to take account of additional information found alongside the sign at issue in the description, presentation or labelling of the product concerned, in particular with regard to its true origin". He also noted that, in the current case, the use of the name 'Glen' does not have a sufficiently clear and direct link with the protected geographical indication, or with its origin country, in order for it to be a 'false or misleading' indication.

The Advocate General's opinion is very important, particularly in the light of GIs and the assessment of their protection and remit thereof. It clearly narrows down the use of any disputed indication in isolation, avoiding any other contextual indicators as to origin or otherwise; however, the CJEU's ultimate decision will set the scene in a more concrete fashion later in the year. This writer expects them to follow the opinion, but that is by no means a certainty.