Copying Not Allowed - Search Engines Copying Databases Infringes Database Rights If It Causes Financial Detriment, says CJEU

Following an earlier opinion from the Advocate General, the CJEU set out its findings on the infringement of database rights by search engines in the indexing of other websites' content. Discussed earlier in this blog, the decision is an important one to set the potential boundaries of database rights and indexing, especially when indexing is so ubiquitous in how the Internet as we know it functions. The decision will leave some rightsholders wanting more, as now the position swings firmly in the direction of the indexing websites.

The decision in CV-Online Latvia SIA v Melons SIA concerned the website CV-Online, which included a database of job advertisements published by various employers. The website also included various metatags, or 'microdata', which, while not visible to the users of the website, contained key information to allow internet search engines to better identify the content of each page in order to index it correctly. These metatags included keywords like  ‘job title’, ‘name of the undertaking’, ‘place of employment’, and ‘date of publication of the notice’.

Melons operate a separate website containing a search engine that specializes in job ads. The search engine allows users to search a number of websites containing job ads in one go according to specific criteria that they set. The Melons' website then produces results based on that search, where users can click on links that take them to that particular job website where the ad is located (including CV-Online). Unhappy about this indexing of their content, CV-Online took Melons to court for a breach of their 'sui generis' right under Article 7 of Directive 96/9. The case progressed through the Latvian courts, ultimately ending up with the CJEU this Summer. 

The CJEU was asked two questions, which the court decided together. 

The question posed to the court asked: "whether... the display, by a specialised search engine, of a hyperlink redirecting the user of that search engine to a website, provided by a third party, where the contents of a database concerning job advertisements can be consulted, falls within the definition of ‘re-utilisation’ in Article 7(2)... and... whether the information from the meta tags of that website displayed by that search engine is to be interpreted as falling within the definition of ‘extraction’ in Article 7(2)(a) of that directive".

The court first discussed 'sui generis' rights in general, which allow rightsholders to ensure the protection of a substantial investment in the obtaining, verification or presentation of the contents of a database. What is required for a database to be protectable is "...qualitatively and/or quantitatively a substantial investment in the obtaining, verification or presentation of the contents of that database". Without that investment, the courts will not protect any databases under sui generis rights. The court assumed that this would be the case in terms of CV-Online, however, this matter would ultimately be decided by the local courts following the CJEU's decision. 

For there to be an infringement of sui generis rights there has to be an ‘extraction’ and/or ‘re-utilisation’ within the meaning of Directive, which, as summarised by the court, includes "...any act of appropriating and making available to the public, without the consent of the maker of the database, the results of his or her investment, thus depriving him or her of revenue which should have enabled him or her to redeem the cost of that investment". 

The court discussed the applicability of the above to the operation of Melons' website and determined that such a search engine would indeed fall within the meaning of extraction and re-utilisation of those databases that the website copies its information from (including in indexing that content). However, this extraction/re-utilisation is only prohibited if it has the effect of depriving that person of income intended to enable him or her to redeem the cost of that investment. This is important since without this negative financial impact the copying will be allowed under EU law.

The court also highlighted that a balance needs to be struck between the legitimate interest of the makers of databases in being able to redeem their substantial investment and that of users and competitors of those makers in having access to the information contained in those databases and the possibility of creating innovative products based on that information. Content aggregators, such as Melons, are argued to add value to the information sector through their acts and allow for information to be better structured online, thus contributing to the smooth functioning of competition and to the transparency of offers and prices.

The referring court would therefore have to look at two issues: (i) whether the obtaining, verification or presentation of the contents of the database concerned attests to a substantial investment; and (ii) whether the extraction or re-utilisation in question constitutes a risk to the possibility of redeeming that investment.

The court finally summarised its position on the questions as "...Article 7(1) and (2)... must be interpreted as meaning that an internet search engine specialising in searching the contents of databases, which copies and indexes the whole or a substantial part of a database freely accessible on the internet and then allows its users to search that database on its own website according to criteria relevant to its content, is ‘extracting’ and ‘re-utilising’ the content of that database within the meaning of that provision, which may be prohibited by the maker of such a database where those acts adversely affect its investment in the obtaining, verification or presentation of that content, namely that they constitute a risk to the possibility of redeeming that investment through the normal operation of the database in question, which it is for the referring court to verify".

The decision will, as said above, come as a big blow to database owners, as the added requirement of financial detriment will be a big hurdle for many to overcome in order to protect their databases from potential copying. The CJEU also notes the utility of indexing and the 'copying' of such databases by content aggregators as useful means of organizing the Internet, which leads to the question of where the limits actually are. It will remain to be seen how the decision will impact databases going forward, but one might imagine the more commercial value in a database the less likely the courts will allow copying of that database. 

That's my Dataset! - AG Szpunar Opines on Whether Search Engines' Indexing can Infringe Database Rights

In the age of big data databases can be worth their weight (or in reality, lack thereof) in gold, since the compilation of those databases can take years and cost tremendous amounts of money. As such, databases are afforded special protection through database rights (i.e sui generis rights). These rights don't always pop up in the courts, but when they do, it's worth taking note, since the infringement of these rights can be deceptively simple, at least on the face of things. As a part of the functioning of the Internet as we know it today, search engines like Google index the websites that allow for it to do so, which in effect adds them to the collective directory of that search engine (and accessible to those searching for it). This indexing will affect all websites and sub-pages that are allowed to be indexed, but could that indexing infringe database rights if done so? As luck would have it the CJEU is slated to decide this matter in the near future, but Advocate General Szpunar has given his opinion on the matter ahead of this decision. 

The case of SIA ‘CV-Online Latvia’ v SIA ‘Melons’ concerns the website 'CV.lv', operated by CV-Online, which includes a database containing notices of jobs published by employers. The website also uses meta tags, allowing for the easier identification of content on each of the site's pages for indexing purposes. The meta tags contain typical information like the name of the job being advertised, place of employment and the date when the ad was posted. 

SIA Melons operates a website called 'KurDarbs.lv', which is a search engine specialising in notices of employment, allowing for several websites posting these notices to be searched on it. The site then refers to the people searching to the websites where the information was found in via hyperlinks (including to the site operated by CV-Online). The meta tags inserted by CV-Online on its website are also displayed in the list of results obtained when SIA Melons’ website is used. 

CV-Online subsequently brought proceedings against SIA Melons for the breach of its sui generis database rights, alleging that it copies substantial parts of the contents of the database on the CV-Online website. Following decisions in the Latvian courts the case ultimately landed on the CJEU's desk, with the Advocate General giving its opinion before the decision.

The AG first discussed the basics of database rights set out in Article 1 of Directive 96/9. The article sets out databases as "...a collection of independent works, data or other materials arranged in a systematic or methodical way and individually accessible by electronic or other means". The 'independent works' discussed should be ones that are "...separable from one another without their informative, literary, artistic, musical or other value being affected", or in other words, they need to have autonomous informative value. The database itself has to include "...technical means such as electronic, electromagnetic or electro-optical processes... or other means... to allow the retrieval of any independent material contained within it". 

In addition to the above there has to have been "...qualitatively and/or qualitatively a substantial investment in either the obtaining, verification or presentation of the contents of that database".

Following on from this the AG quickly set out that the job ads contained in the database were indeed units of information which has autonomous informative value which are separable from the other ads in the same database. The only question that remained therefore was whether CV-Online had made a substantial investment in creating its database. 

Discussing the actual wording of the two questions referred to the court the AG considered that they should be reworded and considered together, namely whether "...under Article 7(1) and (2)... the maker of a database that is freely accessible on the internet is entitled to prevent the use of that database by an internet search engine that specialises in searching the contents of databases". 

According to the AG, after the reformulation of the questions the case at hand resembles the decision in Innoweb BV v Wegener ICT Media BV, in which the CJEU held that where the operator of a meta search engine reutilised the whole or a substantial part of the contents of a database constituted by the website on which that meta search engine allowed searches to be carried out. The use of a meta search engine allowed users to access the whole database through those searches other than intended by the marker (and breached the database rights as a result). 

Looking at whether Melons' website acts as a meta search engine, as in Innoweb, the AG concluded that this is irrelevant, as this is not a requirement for a potential infringement of database rights. He concluded that "...a search engine that copies and indexes the whole or a substantial part of databases which are freely accessible on the internet and then allows its users to carry out searches in those databases according to criteria that are relevant from the aspect of their contents effects an extraction and a reutilisation of those contents". 

However, even with this mind we have to have a balance of allowing for the indexing (and therefore searching) of the Internet, while protecting against 'parasitic' services utilizing databases they didn't create. Keeping this in mind the AG thought that national courts should verify not only whether the extraction or reutilization of the whole or a substantial part of the contents of a database and whether a substantial investment has been made into the database, but also whether the reutilization or extraction prevents the recouping of that investment. If the latter is the case, the database should be protected.  

Furthermore, national courts should consider the protection of competition within the marketplace. This is to prevent the use of database rights to prevent legitimate competition within the EU, essentially through the abuse of a dominant position through the ownership of key information through database rights. If the reutilization of that information, e.g. such as what Melons has done, does not negatively impact the business of the database rights owner, the courts should allow for the reutilization to allow for fair competition. Thinking about these issues will effectively limit the rights of the database maker, provided there is no or limited impact on the recouping of their investment. 

Ultimately the AG answered the two questions as follows, namely that Article 7(1) and (2) must be interpreted as meaning:

(i) a search engine which copies and indexes the whole or a substantial part of the contents of databases which are freely accessible on the internet and then allows its users to carry out searches in those databases according to criteria that are relevant from the aspect of their contents effects an extraction and a reutilisation of those contents within the meaning of that provision; and

(ii) the maker of a database is entitled to prevent the extraction or the reutilisation of the whole or a substantial part of the contents of that database only on condition that such extraction or reutilisation adversely affects its investment in obtaining, verifying or presenting those contents, that is to say, that it constitutes a risk for the possibilities of recouping that investment by the normal exploitation of the database in question, which it is for the referring court to ascertain.

But one must still keep in mind that this must not result in the abuse of a dominant position under Article 102 TFEU. 

The opinion is an important one in the light of how the Internet functions and sets clear guidelines on how the CJEU should answer the questions posed in this case. The ultimate decision by the CJEU could impact the operation of search engines tremendously if it creates very stringent requirements for the indexing of data, but this writer hopes that certain limits are put while respecting the functionality of the Internet. Provided no, or little, damage is done to the original website's recoupment of its investment, indexing should be rightfully allowed. 

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

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.

That Sounds Good - Do You Have IP Rights in Your Own Voice?

Even though many of us don't like the sound of our own voice (although some way less than others), it is still a very personal aspect of who we are and often a very unique identifier. It can also be very valuable, with some voice actors being incredibly memorable for their characters and thus very compelling through just their voice for viewers (for example, Michael Buffer and his iconic "Lets Get Ready to Rumble" phrase). With that in mind, do you have rights in your own voice?

Copyright

The starting point would be protection under copyright, which clearly would protect any voice acting done by an individual. One could argue that daily, non-performing speech would not be protected, since it's not, on the face of it, a performance of a copyright protected work. Speeches and other oral forms of expression would also be arguably protected, affording the speaker rights in their work, and thus in a way their own voice.

The Copyright, Designs and Patents Act 1988 also affords certain performers' rights under sections 182-184, which, among other things, make it illegal to record a live performance without consent or to make copies of recordings without consent. This has been considered by the UK Court of Appeal to potentially apply to performances by deceased artists in the case of Experience Hendrix LLC v Purple Haze Records Ltd (which dealt with performances by the late Jimi Hendrix). Clearly one could protect their voice through the performances themselves, but their voice in isolation is probably not protected.

In the US voice actors have been confirmed to have certain rights in their works. In Midler v Ford Motor Co., the singer and voice-actor Bette Midler asserted her rights in her voice, which was imitated in an advert by Ford. Although the Court of Appeal stated that "…A voice is not copyrightable. The sounds are not 'fixed'", they did afford her rights under common law for appropriation of identity. They highlighted that "…[a] voice is as distinctive and personal as a face. The human voice is one of the most palpable ways identity is manifested". Arguably this is correct, since just a person's voice in the abstract is not necessarily protectable, but the underlying work, including the recording of that work, could be.

Similarly in Waits v Frito-Lay Inc., the US Court of Appeal determined that a radio commercial that imitated the voice of Tom Waits, a famous singer with a very unique voice, amounted to appropriation of publicity rights under California law and false, implied endorsement under federal law.

Copyright does offer the widest set of rights in one's voice, particularly in the United States, which would be used to protect a distinctive, well-known voice, but it would be unlikely that someone without the notoriety would succeed.

Trademarks

Beyond the protection given to recorded voice works as above, could you register a voice as a trademark to protect it?

Peter loved the sound of his own voice - maybe a little too much

Before the introduction of the new EU trade mark Implementing Regulation in late 2015, all EU trademarks had to be graphically represented so as to be able to be registered. This was difficult for sound marks since they could not be graphically represented in a clear and precise way. Examples of failed sound marks would be Tarzan's yell and the famous MGM Lion's roar (although the yell and the roar were successfully registered in 2006 and 2011 respectively). Applications can now include a sound file as a part of the application, which clearly paves the way for the registration of sounds, potentially including a person's voice.

Sound marks can also be registered in the US, which has had a much longer period of acceptance towards more unconventional trademarks. As per the decision in Re General Electric Broadcasting Co. Inc., so long as the sound creates an association for a particular good or service in the mind of the listener, a sound can be registered as a trademark (discussed in more depth in the case of re Vertex Group LLC). The arrangement, however, needs to be definitive.

Clearly it is possible to register a person's voice as a trademark, but only for a particular phrase or arrangement that is clearly defined in the application, for example, through a sound file. This wouldn't confer rights to your voice in general, but could protect some aspects such as catch phrases.

Patents

Although patents don't offer a clear way to protect a voice, they do offer some interesting applications in terms of voices overall.

In a US patent (US20130151243) Samsung have claimed an invention that can be used to modulate voices. Based on this writer's reading of the patent (wrong or not), the module takes in a voice, processes it for particular properties, and then modulates the voices when used, in a way mimicking the voice it's been listening to. A similar Chinese patent (WO2017059694) looks to imitate a source voice altogether.

As is clear patents are not the way to protect anyone's voice, but as AI and technology develops they will be in the forefront of protecting the technologies that might just copy our voices one day.

Conclusion

Overall protecting one's voice seems to be quite tricky, which leaves someone quite exposed should imitation software and other methods of recreation become more widely used, for nefarious purposes or not. Even so, especially without an image right like in the US, one would hope that the law will see a change , as someone's voice can be an iconic part of their person, which should be protected in some way. Legitimate uses, for example for parody and satire, should of course be allowed, but the misappropriation of one's voice should be prevented. How you would do this, this writer isn't exactly sure, but one could look for direction from the US cases and legislation discussed above.

Not Like Two Peas in a Pod - Parallel Importation is Okay if TMs Assigned Abroad, says CJEU

The global marketplace for goods is a very tough one, especially when products are sold in various countries under different entities, even if controlled by a central entity. This gets even more complicated if rights are cherry picked and sold to other companies. Advocate General Mengozzi looked at this conundrum this past summer (more on which here), with a focus on the exhaustion of rights when those rights are sold to another company. The matter finally landed on the CJEU's desk, which rendered their decision in late December.

As a short recap, the case of Schweppes SA v Red Paralela SL dealt with the sale of Schweppes' tonic water, for which the company owned several trademarks in many jurisdictions. In the UK the company assigned their rights to the name Schweppes to Coca-Cola in 1999, but remained the owner of the rights in other EU jurisdictions, including Spain. Red Paralela imported the beverage from the UK to Spain, which were put on the market by Coca-Cola. Schweppes subsequently took Red Paralela to court for trademark infringement.

The CJEU was asked four questions, which it dealt with together, asking in essence "…whether Article 7(1) of Directive 2008/95, read in the light of Article 36 TFEU, must be interpreted as precluding the proprietor of a national trade mark from opposing the import of identical goods bearing the same mark originating in another Member State in which that mark, which initially belonged to that proprietor, is now owned by a third party which has acquired the rights thereto by assignment".

What is important is whether Schweppes rights have been exhausted as a result of their assignment of rights in the UK for the importation of goods into another country where those rights remain.

The Court considered that the rights awarded by trademarks cannot be circumvented through the affixing of the relevant mark on the goods and selling in another territory, even if done legally through assignment. This is still, however, reliant on "…that each of those marks has, from the date of expropriation or assignment, independently fulfilled its function, within its own territorial field of application, of guaranteeing that the trade marked goods originate from one single source". The Court further set out that this condition would not be satisfied when the proprietor (without or without the third-party that was assigned the rights) promoted a global brand with no clear single origin. Through this the proprietor's trademark, as determined by the Court "…no longer independently fulfill[s] its essential function within its own territorial field of application, [and] the proprietor has himself compromised or distorted that function". The proprietor therefore loses their right to oppose the importation of those goods through this distortion.

However, should the parties be one and the same, or maintain an economic link, the prohibition of the importation of the goods might be possible.

Some parallel imports miss the mark

The Court set out that an economic link exists where "…the goods in question have been put into circulation by a licensee, by a parent company, by a subsidiary of the same group, or by an exclusive distributor". Through these relationships the proprietor can directly control the quality of the goods themselves. This is very important, as the actual exercise of control isn't needed, but merely the possibility of exerting control. The proprietor therefore takes responsibility over the goods' quality.

Following the Advocate General's opinion, the CJEU set out that an economic link also exists where "…[after] the division of national parallel trade marks resulting from a territorially limited assignment, the proprietors of those marks coordinate their commercial policies or reach an agreement in order to exercise joint control over the use of those marks, so that it is possible for them to determine, directly or indirectly, the goods to which the trade mark is affixed and to control the quality of those goods". There the prohibition of importation would not be justified to preserve the essential function of the trademark.

An economic link isn't dependant on the companies being formally dependant on each other for the joint exploitation of the mark, nor whether they take control of the quality of the goods or not. Assignment by itself will not create an economic link necessarily.

In summarising their decision, the CJEU set out that "… Article 7(1)... must be interpreted as precluding the proprietor of a national trade mark from opposing the import of identical goods bearing the same mark originating in another Member State in which that mark, which initially belonged to that proprietor, is now owned by a third party which has acquired the rights thereto by assignment, when, following that assignment; the proprietor, either acting alone or maintaining its coordinated trade mark strategy with that third party, has actively and deliberately continued to promote the appearance or image of a single global trade mark, thereby generating or increasing confusion on the part of the public concerned as to the commercial origin of goods bearing that mark; or there exist economic links between the proprietor and that third party, inasmuch as they coordinate their commercial policies or reach an agreement in order to exercise joint control over the use of the trade mark, so that it is possible for them to determine, directly or indirectly, the goods to which the trade mark is affixed and to control the quality of those goods".

The case is an important landmark in the partial assignment of rights for global trademarks. Should a proprietor want to maintain full control, they would have to assign the rights to an entity that they control, or have an economic link with, lest risk the loss of their capability to prevent parallel importation to a maintained jurisdiction. This makes sense, since the assignment of rights would lose their value if the original proprietor still maintained the capability to prevent importation when and where ever they wished.

Shared by a Little Bird - Does Retweeting Protected Works Infringe IP?

Social media has made the near-thoughtless sharing of content a part of everyday life, whether it is sharing an article you liked or a picture you found somewhere. Even though the sharing of the content seems innocuous and more often than not will drive views towards the original creator, the possible legal issues of sharing without actually seeking permission or checking whether, for example, a Creative Commons licence exists. One such platform that might not come to people's mind at first is Twitter, where users can 'retweet' content that someone else has posted on their Twitter account (more on Twitter in general here and here) with very little effort. In the light of this, could the retweeting of content infringe on someone's rights?

This question will soon potentially get an answer, after a claim was commenced in the District Court of the Middle District of Pennsylvania, as reported on JDSupra. In the complaint Keith Bell, a well-known sports psychologist and author, sued King's College (a Pennsylvanian private educational institution) and Jeffrey Knarr (the head coach of American football at King's College) for both copyright and trademark infringement. Mr Knarr had retweeted two images of pages from Mr Bell's book "Winning Isn’t Normal", which were originally shared by a separate Twitter account operated by Northeastern State University's baseball team. While the baseball team removed their tweet after being approached by Mr Bell, Mr Knarr didn't do so, and his retweet had garnered some degree of interest. Mr Bell had registered copyright and trademark rights in his book well before the claim.



Sharing is caring?

As a starting point, Twitters TOS set out that "[b]y submitting, posting or displaying Content on or through the Services, you grant us a worldwide, non-exclusive, royalty-free license (with the right to sublicense) to use, copy, reproduce, process, adapt, modify, publish, transmit, display and distribute such Content in any and all media or distribution methods (now known or later developed). This license authorizes us to make your Content available to the rest of the world and to let others do the same". Clearly this is simply to protect Twitter's position in the event that an author of a work posts their content on the platform, but it doesn't offer a safe harbour for those who post material they have no rights in (or equally, further sharing that material through retweets). Clearly there would be no protection offered by the TOS to any users sharing materials without ensuring its legitimacy.

Case law doesn't shed light on this issue much, as most cases dealing with social media have yet to hit the scene in a big way. For example, a similar claim to the above was filed in 2015, but the case settled before being decided.

Even so, the case of Agence France Presse v Morel offers some guidance. In the case a photographer claimed copyright infringement after a picture they took was copied from their Twitter account and used in newspaper reporting. Among many other observations, the District Court of the Southern District Court of New York saw that the Twitter TOS didn't protect copying the works from the service, as the artists retained the rights in the works even when posted (but Twitter could put them on the website and display them on the artist's account). No licence is therefore given to the copier, even if the TOS state terms that might indicate as such. The retention of rights and the work's subsequent copying are therefore the important considerations around Twitter and copyright infringement.

Arguably, by retweeting e.g. a picture of a work you are creating a copy of that work, and should it be substantial enough it can be copyright infringement. There can be an argument under fair use in the US, which would be, in this writer's mind, a good one, but in the UK fair dealing would be more difficult to argue. A claim of trademark infringement would also be very viable, as the full name of the book (a registered trademark) is included in the Twitter post with the body of the text.

Overall it seems that retweeting material can be risky, particularly if the content is not attributed at all. This writer is a large proponent of sharing content on social media, and believes that the more sharing the better (with proper attribution, of course); however, users need to keep in mind that not everyone wants that to happen. It will be interesting to see where the law develops in terms of social media in the coming years, but it seems that the rights in an author's works would still very much remain and be enforceable.

A Collective Effort - The Impact of the GDPR on Collective Management Societies

This article was kindly drafted by Axel Beelen, who writes the blog IP News (focusing on EU and Belgian IP developments). He can also be found on Twitter here. He is also a data protection specialist.

The rules surrounding personal data are about to change on 25 May 2018 when the new General Data Privacy Regulation (GDPR) will enter into force. Because collective management organisations (CMOs) process their members' personal data, they will have to be compliant with the GDPR next year. Fines can be very high in the case of non-compliance. Below you will find the key points introduced in the GDPR concerning CMOs.

Data-subjects’ rights enlarged and more defined

The processing of personal data is lawful only if, and to the extent that, it is permitted under the GDPR. If the data controller (here the CMO) does not have a lawful basis for a given data processing activity (and no exemption or derogation applies) then that activity is prima facie unlawful. A lawful basis would be the consent of the data subject to do so, contractual necessity, compliance with legal obligations, the vital interests of the data subject, necessary for public interest or the legitimate interests of the data controller.

The "legitimate interests" lawful basis, under Article 6, is the more difficult to understand. It requires the balancing of the legitimate interests of the CMO against the interests and fundamental rights of the data subject (the rightholder).

To be a member of a CMO, rightholders (for example, authors, publishers, artists and producers) enter into an agreement with the CMO. This contract will generally be the lawful basis for the future processing of the rightholder’s data.

Members must be informed before any processing

The GDPR requires that the members of the CMOs have to be clearly and fully informed about their set of rights, including new rights that have been introduced, before the collection and processing of their personal data. CMOs are strongly advised to adapt their privacy provisions, communications and information to meet the requirements of the GDPR.

CMOs will also need to ensure that they have effective systems in place to enable them to give effect to these rights without any costs to the rightsholders. In the case of non-compliance, fines can be very steep: €20 million or up to 4% of the total worldwide annual turnover of the CMO for the preceding financial year.

CMSs have gone through quite the change,
even before the GDPR (Source: Oatmeal)

The GDPR expands the existing set of rights provided in the 1995 Data Protection Directive, and creates several entirely new rights increasing the ability of members of CMOs to better control their personal data. CMOs must provide any requested information in relation to any of the rights of their members within one month of receiving such a request. Only where CMOs receive large numbers of requests, or especially complex requests, may the time limit be extended by a maximum of two further months. Internal policy enabling the CMO to quickly reply to a member request will need to be written.

Members’ rights under the new GDPR

In a nutshell, members have the following rights under Articles 12-22:

• Right of access: members of CMOs (as data subjects) have the right to obtain information relating to (i) confirmation of whether, and where, CMOs are processing their personal data, (ii) the purposes of the processing, (iii) the categories of data being processed, (iv) the categories of recipients with whom the data may be shared, (v) the period for which the data will be stored, (vi) the existence of the rights of erasure, rectification and restriction of processing and to object to processing, (vii) the existence of the right to complain to the DPA, (viii) the existence of, and an explanation of the logic involved in, any automated processing that has a significant effect on data subjects. Additionally, members may request a copy of the personal data being processed by their CMO;
• Right of rectification regarding any inaccurate personal data possessed by the CMO;
• Right to erasure (the "right to be forgotten"): following the Google Spain ECJ ruling of 2014, the GDPR now allows data subjects to request that their personal data be erased if (e.g.) the data are no longer needed for their original purpose (and no new lawful purpose exists) or the data subject exercises the right to object, and the controller has no overriding grounds for continuing the processing;
• Right to restrict processing;]
• Right of data portability: members will now have the right to receive a copy of their personal data in a commonly used machine-readable format, and request that these data are transmitted directly to another data controller (which could be another CMO). This new right has been the subject of Guidelines written by the Article 29 Working Party (Article 29 WP consists of representatives of the national supervisory authority in data protection);
• Right to object to processing for the purposes of direct marketing (including profiling); and
• Right to not be evaluated on the basis of automated processing: members have the right not to be subject to a decision based solely on automated processing which significantly affects them (including profiling). Such processing is permitted where (i) it is necessary for entering into or performing a contract with the data subject provided that appropriate safeguards are in place, (ii) it is authorised by law or (iii) the data subject has explicitly consented and appropriate safeguards are in place.

CMOs shall provide the data subject with all of this information at the time when personal data of the members are obtained.

A DPO to supervise the personal data activities

CMOs will have to appoint a Data Protection Officer (DPO) to supervise their personal data processing activities. CMOs will have to involve the DPO properly and in a timely manner in all issues which relate to the protection of personal data.

Each CMO will ensure that its DPO does not receive any instructions regarding the exercise of those tasks. The DPO cannot be dismissed or penalised by his CMO for performing his tasks. The DPO will directly report to the highest management level of his company. A DPO can be an employee of the CMO or an outside consultant.

The DPO may be contacted by the members with regard to all issues relating to processing of their personal data and to the exercise of their rights under the GDPR.

Conclusion

 For many collective management organisations, compliance with this new GDPR will be very challenging and expensive. They would be well advised to urgently carry out a legal assessment of the current status of their compliance in order to ascertain any gaps. CMOs will then need to implement adequate solutions and monitor their suitability. All of that before May 25th next year.

A Lack of Patent Exhaustion - Discussing the Lexmark Case Ahead of US Supreme Court Hearing

Many IP rights give their owners a great deal or rights and capabilities to restrict the use of their rights by other parties, and arguably, rightfully so, as the creation is indeed theirs. Even though this might be the case at face value, the use and exploitation of those rights should still have certain limitations, for example, from preventing an author from allowing certain people from reading their book after they have purchased a copy. This doctrine is called the exhaustion of rights, which means that after a certain point, the rights held by the author or owner of a technology cease to apply, allowing for the party to use their products as they please. Exhaustion of rights is still a developing area of law, and an up-coming case in the US Supreme Court has been primed to tackle this in relation to patents, with the case having ramifications both ways irrespective of the decision. Looking ahead to the decision, it is important to discuss the Court of Appeal case decided over a year ago.

The case of Lexmark International Inc. v Impression Products Inc. dealt with the sale of refilled ink cartridges for computer printers by Impression, who purchased used cartridges from abroad to refill and resell in the US (having a third-party circumvent the protection mechanism preventing reuse in the cartridges). Lexmark holds patents in relation to these cartridges, and most of the cartridges had strict single-use/resale restrictions set by Lexmark both in the US and abroad. Impression had not sought permission to resell the cartridges in the US, and Lexmark subsequently took the company to court for patent infringement.

Under 35 USC section 271, only the patent holder is authorized to sell and import patented inventions in the US. Impression argued that the rights (undisputed to be valid and enforceable) had been exhausted after the first sale of the cartridges to the original consumer, and therefore their resale and importation would not be an infringement of the rights.  The Court disagreed, and saw that "...a patentee may preserve its § 271 rights when itself selling a patented article, through clearly communicated, otherwise-lawful restrictions, as it may do when contracting out the manufacturing and sale". This would therefore allow Lexmark to assert its rights post-sale as per the stickers on the cartridges.

The Court focussed on the aspect of the provision that restricts the sale of the patented 'without authorization', as the lack authorization of resale through the sticker clearly leaves the buyer without rights. Conversely, the sale of an article without the reservation of rights would, arguably, have the right to resale the item. It all comes down to the language used during the sale process. The Court summarized their position, where "...[a] sale made under a clearly communicated, otherwise-lawful restriction as to post-sale use or resale does not confer on the buyer and a subsequent purchaser the "authority" to engage in the use or resale that the restriction precludes", following the decision in Mallinckrodt Inc. v Medipart, Inc.. This means that the patent owning party would retain the rights in the item if expressly and clearly communicated at the time of purchase, provided that no law or policy is violated through the retention of rights.



Patent exhaustion is a real plight! (Source: Good Little Robot)

The legislative position is not any different, according to the Court, from the common law position as set out in Kirtsaeng v John Wiley & Sons (discussed more here), which restricted the rights in items that have been sold (albeit in relation to copyright and not patent rights). The ultimate seller of patent rights can retain some rights in the sold items, which differs from copyright that does not offer the same varying set of rights.

The second question the Court had to grapple with was whether the sale of the items abroad conferred any authority to Impression to import the cartridges to the US and sell them there. Ultimately, following the Jazz Photo Corp. v International Trade Commission case, the Court determined that no legal rule to this effect existed. For there to be an ability to do so, Impression would have to have a licence, implied or direct, to do so, which in the case they did not have. Similarly to the above, the decision in Kirtsaeng does not apply in this instance either (where copyright protected works were bought abroad and imported for sale in the US), as the law in copyright affords an equivocal right to resell the items, which patent legislation does not give.

Ultimately, Impression's case failed and the Court found that they had indeed infringed Lexmark's rights.

Both Judge Dyk and Hughes dissented from the judgment, raising opposing views on both the applicability of Mallinckrodt and Jazz Photo.

In their view, in relation to the first argument of patent exhaustion, the decision in Quanta Computer Inc. v LG Electronics Inc. applies, which sets out that "...the initial authorized sale of a patented item terminates all patent rights to that item". The moment the item involving the patent has been sold with authorization, all rights in the patented aspect cease to apply, even in relation to resale. Additionally, in relation to the second argument, once the item was sold abroad (with no restrictions as to US patent rights), the rights in the patent works are exhausted. This is even more poignant, according to the judges, due to the sale by the patent rightsholder, and not a mere licensee.

The case, once decided by the Supreme Court, could potentially have huge implications to the sale and resale of goods incorporation patent rights in the US. Should the Supreme Court side with Lexmark, it could cause a huge cooling on the resale of products in the US, and an upswing on the incorporation of stricter sale terms in relation to patent rights in any given goods. This could cause prices to rise and items to be less readily available to consumers. On the opposite side, should the Supreme Court agree with Impression, patent rights could be hugely devalued in the US, especially when it comes to the sale of goods at first instance. This could mean higher up-front costs to protect against the loss on resales, but also release a whole swathe of second-hand markets for patent goods, particularly from abroad should the rights have been exhausted. No matter which way the case goes, it will be very important to both consumers and patentees alike, and shape the future of patent exhaustion for years to come.

Source: Gizmodo

Copyright Usurped - EU Proposal for a New Copyright Directive

This article was kindly drafted by Axel Beelen, who writes the blog IP News (focusing on EU and Belgian IP developments). He can also be found on Twitter here. He is also a data protection specialist.

In September 2016, the European Commission published a proposal on a new EU Copyright Directive. This new proposed Directive follows the InfoSoc Directive, drafted in the wake of the European Commission's review on the modernization of the EU copyright rules. The European Commission has presented legislative proposals to make sure that consumers and creators can make the most of the digital world, and will aim to help European copyright industries to flourish in a new Digital Single Market and authors to reach new audiences. The proposal is still fiercely discussed at the European Parliament, with plenary vote set for late 2017 or early 2018.

This article aims to set out the key points of the proposed Directive, and to discuss its impacts in the EU legal landscape.

1. The EC Proposal

1.1 A new publishers' right (Art. 11 of the proposal)

Because press publishers are facing difficulties in licensing their publications online and obtaining a fair share of the value they generate (which could ultimately affect citizens' access to information), the EC wants to provide publishers with the same reproduction and communication to the public rights that the InfoSoc Directive provide for authors. 

These new rights for publishers (so-called "neighboring rights" or an "ancillary copyright") would apply for 20 years after each publication.

Some fear that these provisions would generate more income for European publishers by allowing them to charge internet platforms for displaying snippets of their content to users. In fact, anyone using snippets of online content would first have to get a license from the publisher responsible for the content. 

The new neighboring right has been sharply criticised by Google and other businesses sharing online content. News aggregators argue that they provide online publishers more visitors on their websites (in turn increasing revenues from, for example, ads), and are not substituting the publication of the original works.

Sometimes it's easier to not bother with copyright

The EC's proposal is a clear response to uncertain and temporary national solutions to tackle this phenomenon, resulting in either the conclusion of agreements between Google and local press publishers (Belgium, France, Italy) or the adoption of legislative initiatives (Germany, Spain) in relation to news content forcing news aggregators to pay publishers when their headlines and news snippets appear in the news aggregators services. In Germany and Spain, right after the adoption of the regulation, Google Inc. stopped its local Google News tool. As a result, German and Spanish publishers said they lost significant traffic.

1.2 The value gap (Art. 13 of the proposal)

As legal access to streaming movies, music and literary works has become more ubiquitous and easy for consumers in recent times, there still is a clear gap in the remuneration (or the lack of increase thereof) of rightsholders through these services. 

The gap is between what service providers like YouTube, DailyMotion, Vimeo and others are willing to pay for e.g. music licenses and their real market value. The difference between rightholders' income and YouTube revenue is profoundly immense and the latter have limited appetite to properly or sufficiently remunerate rightsholders for copyright-protected content online. 

In place of talking about a “value gap”, we should focus more on the big 'transfer of value' between the value that certain digital platforms extract from music, movies and other works and the smaller value that is returned to related rightsholders. These digital platforms are clearly under-licensed or not licensed at all. 

Following Article 13 of the proposal, internet platforms hosting “large amounts” of user-uploaded content must monitor user behavior to identify and prevent copyright infringement. It will mean that intermediaries will have to attain proper licences and will have to implement filtering technologies to proactively prevent infringing activities. As raised by many, one of the most concerning aspects of the EC’s proposed legislation is the complete lack of detail provided on how the suggested policies would be implemented.

Note that, beside the use of not defined terms (e.g. what qualifies as “large amounts” of content), this part of the proposal could be in breach of existing EU law. Indeed, the safe-harbor provisions of the E-Commerce Directive forbid general monitoring obligations that Article 13 would establish, which was confirmed by the CJEU in SABAM v Netlog.

1.3 A limited text and data mining exception (Art. 3 of the proposal)

Article 3 of the EC Proposal (“Text and data mining”) aims to establish a new EU-wide copyright exception for the modern research method of text and data mining, but only for “research institutions” and “for the purposes of scientific research”, and only when the research institutions “have lawful access for the purposes of scientific research”. 'Text and data mining' means any automated analytical technique aiming to analyse text and data in digital form in order to generate information such as patterns, trends and correlations. 

One can criticize the limits of this new exception, in that why should “data mining' not be permitted for research conducted in a commercial context, for purposes of journalism and for any other purpose? 

2. Publishers' right to disappear and be replaced by a presumption of representation

The adoption of the Directive requires several European Parliament (EP) Committees to draft opinions that will then need to be taken into account in the Report by the lead Committee of the EP on this matter, namely the Legal Affairs (JURI) Committee.

The draft report of the JURI Committee written by rapporteur MEP Comodini (EPP) was published in March 2017. 

It does not mention the publisher neighboring right anymore as discussed above on point 1.1. The report rejects the Commission’s premise and clarifies that using snippets to make news discoverable is not necessarily harmful to publishers’ financial interests, and thus shouldn’t be subject to licensing. 

The paper proposes to replace the neighboring right with a right that "…provide[s] publishers of press publications with a presumption of representation of authors of literary works contained in those publications and the legal capacity to sue in their own name when defending the rights of such authors for the digital use of their press publications". It has to be seen if this would also mean that publishers can still sue for non-licensing.  

Moreover, the draft report proposes to remove the obligation for automated monitoring for online service providers, leaving electronic platforms to ensure the functioning of agreements with rightholders without prescribing how to do so. Only information society service providers that are actively and directly involved in the making available of user uploaded content to the public should take appropriate and proportionate measures to ensure protection of works or other subject-matter.

Those measures, such as the use of effective content recognition technologies, have to be appropriate and proportionate. The service providers have to provide rightholders with adequate information on the functioning and the deployment of these measures, as well as, when relevant, adequate reporting on the recognition and use of the works and other subject-matter on their platforms.

The Legal Affairs Committee also wants to extend the text and data mining exception to all people considering that if you have the right to access/read content, you also have the right to mine it.

3. Deadline

Amendments to the draft report were accepted until 12 April 2017, after which the report and the amendments will be debated again and voted on in June 2017. The plenary vote at the European Parliament on the Directive text is expected at the end of 2017 of at the beginning of 2018.

Rights Resurrected - The Use of Abandoned IP Rights

Intellectual property, much like many other forms of property, can become either useless or worthless to a rights holder, even if that would not be the case as it stands when the rights are let go or forgotten. A good example of this is the recent re-emergence of Crystal Pepsi; a clear Pepsi cola drink that was sold during the 1990s. Pepsi had registered the name Crystal Pepsi as a trademark, which it promptly abandoned when the drink failed to become popular. Due to a surge in demand, Pepsi reintroduced the product, and would, arguably, use the previous goodwill associated with the product to protect it (and they did successfully register the trademark again late last year). This begs the question, can you use any abandoned rights you may have in your goods or services, or any other works?

Copyright

Copyright, by its nature, is automatic, and requires no real action on part of the copyright holder. This means that a lack of use does not impact the rights given to the author of any given work, and thus copyright cannot be 'abandoned' through inactivity. In the US the situation is slightly different, and although rights are afforded through common law, one should still register their copyright in order to fully benefit from the federal protection afforded to authors (although a lack of registration does not lead to an 'abandonment' of rights).

In the UK there is no express provision for the abandonment of copyright, and therefore there is no real case of copyright revival, but one could argue that the copyright holder, in ignoring his rights and allowing for the free use and sharing of his works, could be 'abandoning' their rights to the works. One still has to appreciate that the copyright holder can at any time reassert their rights, and thus the copyright in the works is newly resurrected (although, as evident from the above, was never gone to begin with).

Our cousins in the United States do accept the abandonment of copyrights in works. The current law was explained in Capitol Records, Inc v Naxos of America, Inc, where the Court of Appeals set out that "...[the] abandonment of copyright requires (1) an intent by the copyright holder to surrender rights in the work; and (2) an overt act evidencing that intent". Arguably this could be achieved through a statement or the issuance of a public domain licence, or even through another act that shows a clear intent to abandon the rights you have in any given work (although inaction as to the works' protection would not necessarily be enough). It is unclear whether the rights holder could relinquish their rights post-abandonment, but arguably the parties who have used those works during the period of abandonment would clearly be protected.

Trademarks

As illustrated by the above example involving Pepsi, it is very possible to abandon a trademark and re-apply for it (i.e. an alternative), potentially re-appropriating that mark. What is more relevant in the context of trademarks is the potential loss of goodwill, especially in relation to passing off as a common law right, rather than a right under the Trade Marks Act 1994.

Rodney refused to abandon any invention (Source: Gunshow)

In the case of Star Industrial Co Limited v Yap Kwee Kor the Privy Council considered this question, and reiterated the existing tangible connection between a company and its goodwill; however, the latter cannot exist in a vacuum outside of the company's business activities. If a company, with intention, abandons the goodwill in a given product or company, it cannot use it after the fact. This is not as clear as that, however, as in Maslyukov v Diageo Distilling Limited Justice Arnold saw that "...the test is whether the relevant business has been abandoned so as to destroy the goodwill. Mere cessation of business is not enough... [a] cessation of production of goods or provision of services does not necessarily mean that there has been a cessation of business capable of sustaining goodwill". What his judgment seems to illustrate is a need for an active component of abandonment, rather than just a mere stoppage in trading or production, indicating clearly and without a doubt the company wished to abandon all goodwill in the relevant goods or services.

One can 're-appropriate' goodwill in goods even after the end of their production, provided that some actions have been taken to preserve that goodwill (e.g. conducting business in the area of commerce, retention of the subsidiary or corporate entity that held those rights etc.) and no active efforts have been made to truly abandon those rights. This would enable the party to assert those rights under common law in passing off, as if those rights had never been 'abandoned'.

Patents

One can abandon a patent, or an application for a patent, at any time. This would entail either not paying the requisite maintenance fees on the patent (automatically lapsing the patent), or otherwise surrendering the rights to the invention. This is not, however, the end, as it is possible to seek the restoration of the patent within 13 months of it lapsing, although only in the case of 'unintentional' lack of payment of fees. Once the patent has fully lapsed the rights to the patent expire, and there is no way to reclaim those rights (unlike in copyright or under passing off).

As is clear abandoning the rights in your intellectual property might not pay dividends, although does give the rights holder the flexibility to avoid additional legal costs or fees associated with the rights and asserting them. Nevertheless, it still might be possible to relinquish the rights you have abandoned, in very limited circumstances. This writer is a staunch believer in the retention of ones rights, but has to concede that this might not be the best option for every rights holder.

Words Hurt - Disparaging Trademarks and Free Speech Collide

Freedom of speech or expression has often been a sore point of contention for those wishing to protect a full freedom of expression (i.e. no restrictions on speech whatsoever) and those who want to limit it within a certain space to ensure a more harmonious society (i.e. the prevention of hate speech, for example, but allowing for a broad freedom of expression nonetheless) - although the former surely does not prevent a harmonious society as a concept itself. With that in mind, intellectual property is no exception, after all, most ways of expression yourself and/or marking your goods to distinguish them often tread the line of good taste and offense in order to further their respective goals. Especially with trademarks there are certain limitations on what you can use as a registered trademark, but does a limitation on your use of said marks prohibit your effective freedom of speech?

This issue was largely brought to light in the recent Washington Redskins trademark litigation, where the offensiveness of a trademark potentially disparaging native Americans was a heavy point of contention, and the Redskins were subsequently stripped of their trademark (although the loss of their mark is not as straightforward as that) due to the disparaging nature of the mark. However, the Redskins never brought a claim under the First Amendment of the US Constitution.

The matter of free speech was brought into the limelight regarding the refusal to register a trademark after a US Court of Appeals decision in Re: Simon Shiao Tam where the Court affirmed a prior decision to refuse the mark "THE SLANTS" due to its offensiveness against people of Asian descent. The mark related to the name of a rock band called The Slants, fronted by Mr. Tam (including several other members of Asian descent as well). The Court also promptly concluded that there was no impairment of Mr. Tam's First Amendment rights, following the precedent set in Re: Robert L. McGinley some 30 years ago, where the United States Court of Customs and Patent Appeals saw that "...the PTO's refusal to register... [a] mark does not affect his right to use it. No conduct is proscribed, and no tangible form of expression is suppressed. Consequently, [the mark's holder's] First Amendment rights would not be abridged by the refusal to register his mark". Arguably, prima facie at least, a refusal of registration does not prevent the use of a mark, but it does, however, prevent its effective protection under trademark law and can cause issues for the proper monetization of a mark in other commercial endeavors should the holder's venture become more successful than its own field allows it. Albeit this does not affect the use or 'expression' in the mark, but mainly the commercial aspects surrounding the mark.

Peter never was a man of consistency

What makes the decision in Re Simon Shiao Tam interesting are the remarks made by Justice Moore, although not dissenting, after the majority's decision to reject the mark (after which the Court of Appeals issued an Order for an en banc hearing to decide the issue). In her Honor's mind: "...it is unquestionably true that trademarks are protected speech under Supreme Court commercial speech jurisprudence" and that "...the government has conceded that “[t]rademarks are a form of commercial speech.”. Because a trademark identifies the source of a product or service for users, it is protected commercial speech". This writer will wholly admit that his knowledge of US trademark law is not as extensive as he'd hope to be, but the argument presented here seems a tad flimsy. The use of a mark in commerce, on the face of it, is not expressing a point or a view, but merely the distinction of a product or service from other similar ones. The more 'offensive' a mark does not correlate to a higher form of expression necessarily, even if it's to utilize or bring to light racial issues. Yet, the US courts will know more of the substantive side of things, so this writer will not address any other jurisprudential issues here, and awaits the en banc decision in Re Tam with interest.

Are there any freedom of expressions issues in the UK in relation to the same subject matter? Under the Trade Marks Act 1994 a mark can be refused registration if it is "...contrary to public policy or to accepted principles of morality". This would, arguably, cover any racial slurs or other content deemed offensive in the public's view (such as the name The Slants, potentially). Also, under the Public Order Act 1986 speech inciting racial hatred is not allowed, although the freedom of expression is sacrosanct under the Human Rights Act 1998. Arguably freedom of expression is narrower than the one protected by our cousins across the pond, and would not allow for the use of negative language even in trademarks, provided the mark is against public morality (and negative racial connotations, even if hidden behind good intentions, would probably be). This view was firmly illustrated by the UK Intellectual Property Office's decision in Basic Trademark SA's Trade Mark Application, where a mark was refused under the Trade Marks Act's morality provision, and was seen to not infringe Article 10 of the European Convention on Human Rights (and therefore, the Human Rights Act above). The case does, however, highlight the need to balance both interests: "...[the] right to freedom of expression must always be taken into account without discrimination under s3(3)(a) [of the Trade Marks Act] and any real doubt as to the applicability of the objection must be resolved by upholding the right to freedom of expression, hence acceptability for registration". The UK does have more questions in terms of freedom of expression and registered trademarks, but the balancing of both interests does take it into account even in this area of law.

All-in-all the line between the protection of a legitimate freedom of speech (or a more open freedom, such as in the US) and the curbing of possible moral outrage is a fine one, and both interests should be balanced in an assessment of the registrability of a mark. Nevertheless, it is hard to draw a strict comparison with EU and US rights due to their big differences, but both jurisdictions do see a clear need for the allowance of expression even in the world of trademarks. This writer for one, as said above, awaits the en banc decision of the US Court of Appeals in the Tam case, and it will be interesting to see whether trademarks are a true form of expression under US law, and therefore protected by the First Amendment.

Source: World Trademark Review

New Waves of Copyright - Reform Proposed in the EU

In the last couple of years it seems that copyright has not been willing to stop in its transformation and moulding to its new home in a digital world. With recent reforms enacted in the UK, Australia and Ireland, among others, this writer for one has been waiting to see where things go in the coming years. In that vein, discussion has yet again been brought up on copyright, its efficacy and whether things should be changed entirely by European Parliament member Julia Reda in mid-January. Although this recent discussion seems very unlikely to yield any results as to change (says this writer in his ever-present cynicism); however it merits discussion, or at least addressing.

The draft report itself is quite brief, and shall be broken down into its respective headings.

Exclusive Rights

Ms. Reda, although a supported notion by many, does not want to eradicate copyright altogether. Copyright is an important decide to incentivize and reward independent, original creation, and this writer for one would never want to see it wholly removed from the world's IP scheme. Ms. Reda does, however, bring an interesting addition to this existing regime: "...[she] calls for improvements to the contractual position of authors and performers in relation to other rightholders and intermediaries". One can try to envision how, through law, the relationship between creator and funder could be improved, seeing as the relationship is (often) quite unbalanced by its nature. In the UK the freedom of contract is a corner-stone of contract law, and should be upheld, even if/when it has the capability to produce unbalanced contractual relations. This, by no means, should lead to unfair contractual terms, but it does not present a need for legal intervention in the scheme of copyright in itself.

A big point of contention within copyright has been fair dealing, and the allowance of using copyrighted material for the purposes of creating new, original works, or simply for the reporting or discussion of current events. Ms. Reda proposes that "...the EU legislator should further lower the barriers for re-use of public sector information by exempting works produced by the public sector - within the political, legal and administrative process - from copyright protection". In the UK at least, under the Re-use of Public Sector Information Regulations 2005, the use of such information is allowed under certain circumstances, and only through the consent of relevant governmental bodies. Although by no means perfect, it aims to safeguard potentially sensitive information from public viewing, even if requested through the Freedom of Information Act 2000. Ms. Reda's objective clearly is one of openness and freedom of publication for all; however this would present challenges if implemented with little or no restrictions.

When piracy failed politics was what was left for Captain Hook

Her final argument relating to exclusive rights is one which piqued this writer's interest: "[she] [c]alls on the Commission to safeguard public domain works, which are by definition not subject to copyright protection, and therefore should be used and re-used without technical or contractual barriers; also calls on the Commission to recognise the freedom of rightholders to voluntarily relinquish their rights and dedicate their works to the public domain". Arguably, her initial point seems like quite the obvious one, but, as the Sherlock Holmes saga (discussed here and here) has shown us, even if a work or works are in the public domain it doesn't necessarily mean they are there as firmly as one would believe. The public domain should, indeed, be the public domain, and all works within should be free to be used. Copyright protects specific expression, not ideas (as has been discussed prior in more detail), and once the expression is within the public domain (e.g. a specific story relating to Sherlock Holmes), it should be free to be used - even encompassing ideas within that expression. As for Ms. Reda's proposed right to relinquish any and all copyright interests in works voluntarily, a right could be recognized; however seems highly unnecessary given the function of copyright. Should the copyright holder of the original work just simply not pursue any claims of infringement, the rights are rendered effectively useless, albeit not void. Allowing for the relinquishing of rights does protect any subsequent derivative works from future malicious attacks from new rights holders, and would seem a great device to expand on copyright and the powers of rights holders on self-governance of their works.

Exceptions and Limitations

Exceptions, especially when it comes to private use of copyrighted content, have been a sore subject for a lot of parties involved. Too little allowance of use restricts the freedom to use your legally purchased materials, yet too few restrictions can lead to mass abuse of said content. In that vein, Ms. Reda has proposed major changes in this area, which should be addressed alongside the above.

Ms. Reda proposes that "...exceptions and limitations should be enjoyed in the digital environment without any unequal treatment compared to those granted in the analogue world". Arguably, this approach is very sensible, and this writer for one cannot think of an instance off the top of his head where digital would be excluded from exceptions when compared to its analogue counterpart. Nevertheless, this is something that should be enshrined in the back of any law pertaining to modern copyright, and defended to ensure the comfortable transition from the physical to the digital in the years to come.

She further proposes that "...all exceptions and limitations referred to in Directive 2001/29/EC [should be made mandatory], to allow equal access to cultural diversity across borders within the internal market and to improve legal security". This writer would argue that the introduction of exceptions is less about diversity, but more about the promotion of communication and the creation of new, potentially copyrightable, works. Whether all exceptions should be made mandatory is a question one cannot easily answer; however, quoting many parents, too much too quick can be bad, and a gradual introduction would be beneficial in the long run. Ms. Reda also wants to add more flexibility to the aforementioned exceptions, and her argument echoes that of US and Canadian fair use where the exceptions are less à la carte, and more malleable to a different assortment of uses based on the use and their impact on the original works.

Hyperlinking is currently the topic of choice at the ECJ, and Ms. Reda also proposes its protection, due to a lack of communication to a new public through hyperlinking. As has been discussed in both Svensson and BestWater, the ECJ seems to quite firmly protect this notion in Europe, and with the forthcoming decision in C More hopefully even further clarifying this, this write does not fret for the sake of hyperlinking in the near future.

Ms. Reda also suggests that "...the exception for caricature, parody and pastiche should apply regardless of the purpose of the parodic use" - something that this writer will wholly disagree with. Deckmyn was the most recent instance where parody was assessed on an EU-wide basis, and the purpose of use in terms of parody is an important consideration and should not be omitted. A borderless approach to parody will only create abuse and infringing works created under the veil of parody when no parody was intended. When using copyrighted works the use should be a genuine, bona fide parody use, which both protects expression and encourages it through creativity in parody and thus, potentially new protectable works.

Ms. Reda goes further into other exceptions, but for the sake of brevity, those will be left out, although still remain important considerations for the future.

Conclusion

The response at large to the proposal has been varied, and that's no surprise. What Ms. Reda is proposing is by no means revolutionary, and a lot of what is brought up, from an IP person's stand-point is worth protecting and/or extending copyright to in its little realm. Yet, what Ms. Reda's undoing is, is her affiliation with the Pirate Party. The image evoked to anyone involved in IP, especially rights holders, will be one of dismantlement, and a fear of the allowance of piracy and losing the very structure your livelihood depends on. Ms. Reda does not propose this; however she inevitably loses out on that one simple aspect: public relations.

This writer commends a lot of what she has put forth, and seeing how copyright has started to evolve in the last couple of years yields a tremendous amount of promise. Nevertheless, there are doubts as to the proposals and their efficacy in the future, but from an end-user perspective, Ms. Reda gives a glimmer of hope for a more open (i.e. less restrictive) copyright regime, which still aims to support the content creators out there and protect their works.

Source: IPKat