IP Iustitia Turns 3!

Yet another year has passed, and IP Iustitia takes a moment to celebrates its 3rd anniversary! Both the year 2015 and early 2016 have been very eventful in the IP space, and this writer for one does enjoy taking a breather to commemorate this great occasion, if only briefly.

In its inception in early 2013, I never imagined this blog being this popular and drawing in this much interest in the IP community as it has today. Through the blog I have gotten to meet some amazing people (virtually or physically) and to share my meager musings with thousands of people; something which I do not take for granted! It has been a thrilling ride, and one that I aim to keep going for years to come.

As in earlier anniversary editions, here are some details on the blog's current numbers, figures and statistics, should you be interested in knowing what three years of active blogging might entail.

• The blog has been visited by over 110,000 people from dozens of different countries, with the US, UK and other English speaking countries forming the bulk of the visitors. 

• The blog's Twitter account, @IPIustitia, has amassed an amazing 767 followers (as of today) over these three short years, including a great deal of retweets, likes and discussion surrounding posted articles.

• The blog also hosts nearly 200 articles discussing a myriad of topics and cases. Should you find that a topic or case that you would want has not been discussed, please email me at jani.ihalainen(a)gmail.com and suggest it.

• The blog's most read articles are Can You Own a Recipe? When Food Meets Intellectual Property Law and Retrospective - What is Original?, both of which have been viewed well over 2000 times. 

• The blog has over 200 subscribers via its Feedburner RSS service, with more subscribing via other services as well. 

But, as always, the reason why I keep writing these articles is above all else you, the reader. Although the blog's beginnings were mainly as a platform to indulge my own academic curiosity (and still is), the feedback, thoughts and connections I have made through it have been what keeps me writing and sharing my thoughts with you all. Whether you are a loyal reader, or merely a casual passer-by, I wanted to say from the bottom of my heart: Thank you! The IP community is a great one, and I am incredibly proud to be a part of it, and to share this topic with many of you who are truly passionate and incredibly knowledgable about IP.

Please keep sending me your thoughts, questions and feedback via email, and do subscribe to the above services if you do enjoy what IP Iustitia has to offer.

Here's to a great 4th year!

A Positive Signal - No Liability for Providers of Free WiFi, Says AG Szpunar

As discussed on this very blog over 6 months ago, free public WiFi is something we all take for granted, even if just a little. Having access to the worldwide web at most restaurants, coffee shops and even the Underground in London is nearly ubiquitous in the developed world, and one that presents both opportunity for its users and liability for those who provide it, especially when it comes to the infringement of intellectual property rights. The CJEU has been slated to answer the question of third-party liability for those who provide free WiFi in the case of copyright infringement, and awaiting that the opinion of Advocate General Szpunar has given their answer as to this highly important question.

The case of Tobias McFadden v Sony Music Entertainment Germany GmbH deals with Tobias McFadden, who owned a business selling and renting lighting and sound systems for various events, and offered free WiFi access at his store for any visiting patrons. The Internet connection offered had no password protection, nor did Mr. McFadden monitor the users taking advantage of the free WiFi. In early September 2010 such a user downloaded a song illegally using his WiFi connection, and Sony Music subsequently took him to court for copyright infringement as a liable third party.

The Regional Court of Munich referred the matter to the CJEU, who had to answer several questions relating to Article 12(1) of the E-Commerce Directive, pertaining to whether the provision of the WiFi would amount to the provider as being a mere conduit, or whether they would be liable for the infringement indirectly.

The Advocate General grouped the questions into two more specific references: "...whether a professional person... who, in the course of business, operates a free, public Wi-Fi network, falls within the scope of application of Article 12 [as a mere conduit]", and therefore is not liable for the infringement of any other parties using that WiFi (questions 1-3); and, if Article 12 does apply, the he needs to interpret the limitation of liability of intermediary service providers in that Article (questions 4-9).

The Scope of Article 12

The scope of Article 12 hinges largely on the potential economic nature of the provision of the service, as defined in Article 2(a) of the same Directive, and the meaning of 'providing' access to a network under Article 12.

A lack of WiFi would cause some issues

The Advocate General addressed the first point by concluding that the provision of free WiFi would indeed be an economic activity, as "...where, in the course of his business, an economic operator offers Internet access to the public, even if not against payment, he is providing a service of an economic nature, even if it is merely ancillary to his principal activity". The Advocate General added onto his point, setting out that the provision of the Internet access necessarily takes place in an economic context, that "[a]ccess to the Internet may constitute a form of marketing designed to attract customers and gain their loyalty. In so far as it contributes to the carrying on of the principal activity, the fact that the service provider may not be directly remunerated by recipients of the service is not decisive.". What remains key here is the ancillary nature of the free WiFi, and this writer agrees, since even if they WiFi is not the focal point of the business, it drives foot traffic and adds value to the provision of the main service, creating a service of economic nature (which is important, since nature does not necessarily mean direct economic benefit)

He then turned to the matter of the meaning of 'providing' access to a network, determining that it means "...that the activity in question enables the public to have access to a network and takes place in an economic context". The intent of projected role of the provider is not relevant, but merely the provision of the service in the above economic context.

The Advocate General then concluded that: "...Articles 2(a) and (b) and 12(1) of [the] Directive... must be interpreted as applying to a person who, as an adjunct to his principal economic activity, operates a Wi-Fi network with an Internet connection that is accessible to the public free of charge".

Interpretation of Article 12

Questions 4-9 concerned the specific interpretation of Article 12, and will be dealt with in more brevity below, although discussed quite extensively by the Advocate General. The questions are, specifically, whether a national court could penalize an intermediary service provider, in the event of infringement through their service, awarding damages, costs or an injunction as the form of the penalty (questions 4-5). Additionally, if this would not be generally possible, whether it would be possible to limit the extent of Article 12 (question 6), or through other unwritten requirements (questions 7-8). Finally, the last question asks for the limits of any injunctions that may be awarded against an intermediary service provider (question 9).

In answering question 4 and 5 the Advocate General saw that the limitations of liability for intermediary service provides would extend to damages and pecuniary claims, such as for costs. In his view this is precluded by Article 12(1), and would have an impact on the development of the service provider's business, irrespective of it being damages or punitive costs. He did, however, accepted the possibility of injunctive relief, and any ancillary penalties thereto. In summary to questions 4 and 5, he stated that "Article 12... precludes the making of any order against a provider of mere conduit services that entails a finding of civil liability against that service provider... [it] therefore precludes the making of orders against intermediary service providers not only for the payment of damages, but also for the payment of the costs of giving formal notice or other costs relating to copyright infringements committed by third parties as a result of the information transmitted. It does not preclude the granting of an injunction, non-compliance with which is punishable by a fine".

In relation to questions 6,7 and 8 (seeking to clarify the possible exclusion of actions taken against intermediary service providers), the Advocate General sought to strike a balance per recital 41 of the Directive. In his opinion, the Advocate General saw that there should be no limitations imposed on actions that can be taken against providers, though taking into account their actions when the infringement is brought to their attention. He also observed that the conditions under Article 12(1) are non-exhaustive, and could be added to with additional unwritten requirements.

Finally, he turned to the final 9th question, which asks whether national courts could impose injunctions on service providers against future infringement on their network. He saw that this was indeed possible, but this injunction could not impose a future obligation of monitoring the network or breach any other EU or national legislation (including the basic human rights afforded in the European Convention on Human Rights). He summarized that the injunction can only issued if the provider cannot, or will not, address the infringement in one of three measures: the termination of the internet connection (of the infringer); password-protection of the connection; or the monitoring the connection, but only to ensure the future infringement of rights using the same connection (observing time limitations on said monitoring).

The ultimate decision of the CJEU is pending, and will potentially impact the provision of free WiFi in the EU should they not follow the AG's opinion in this matter. This writer expects them to follow the opinion, as it clearly shows a practical and functional approach to a complex, and sensitive question. Should they not do so, the provision of free WiFi could be severely hindered, or even ended by some providers, which would be a big problem for those who cannot necessarily afford their own connections. Either way, this writer is anticipating the CJEU's decision with great interest.

Source: IPKat

All Packed Up - UK Supreme Court Rejects Trunki Appeal

Community Registered Designs rarely get their time in the spotlight, but the Supreme Court's decision on the Trunki saga has been one that many intellectual property practitioners have been waiting for. The case is an important one, and sets the tone for the future of 3D registrations as designs, potentially impacting the vast amount of CRDs that use these types of illustrations (mainly through the use of CAD imaging) as their registration. With bated breath this writer awaited the decision, which was published yesterday.

The case of PMS International Group Plc v Magmatic Limited dealt with the Trunki travel case, designed by Robert Law in the late 1990s (at the time called the 'Rodeo'). The case is intended for kids, allowing them to ride the suitcase as well as use it in its traditional sense, incorporating child-friendly animal themes in its finished look. Mr. Law subsequently sought registration for the design, and attained his CRD in 2003 (No. 43427-0001), exclusively licencing the sale and manufacture of the design to Magmatic Limited, his own company. The registration used CAD imaging in the illustration of the Trunki suitcase, using a degree of tonal contrast to showcase the different components of the design (incorporating no decorations apart from the tonal differentiation of the wheels, "horns" and the strap at the top, for example). PMS International, having noted the success of the Trunki case, designed and manufactured its own version called the Kiddee Case, which incorporated a very similar design and child-friendly decorations (although, as the Court noted, with some distinct elements in the decorations and/or colors used). Magmatic then started the proceedings over the infringement of their design, ultimately culminating in the Supreme Court's decision.

What the Supreme Court had to answer was whether the Kiddee Case "...produce[s] on the informed user a different overall impression" from the registered Trunki design, therefore not infringing the design. This includes, to put it plainly, the appearance of the two products, especially in the light of the features shown in the CRD, reflecting the choices of the applicant at the time of filing (restricting or broadening the registration based on the inclusion or exclusion of features and/or ornamentation).

The Court had to deal with the disagreement between Justice Arnold and Lord Justice Kitchin in the first instance and appeal decisions, which dealt with the absence of ornamentation and the effect of the included two-toned coloring in the CRD documentation as detailed above. Lord Neuberger, handing down the unanimous decision of the Court, dealt with the disagreements in three parts, discussing each affecting element individually per the Court of Appeal's decision.

The horned animal appearance

In the judgment of the Court of Appeal, Lord Justice Kitchin considered that Justice Arnold had not fully given weight to the overall impression of the CRD as a 'horned animal', and the distinction between it and the more 'insect' appearance of the Kiddee Case, resulting in the Kiddee Case not infringing the design.

The Supreme Court agreed with Lord Justice Kitchin, and determined that Justice Arnold had not given proper weight to the overall appearance of the two cases. This is clearly a subjective assessment on Lord Neuberger's part, and this writer, although can see his point, will disagree that the judge did not consider the overall impression. Justice Arnold seemed to focus on the suitcase shape of the CRD, rather than its fanciful impression, and both perspectives can be accepted, however, he did not entirely dismiss the impression the design made as an animal or creature with 'horns'.

Decoration of the Kiddee Case

Similarly, Lord Justice Kitchin disagreed with Justice Arnold on the ornamentation of the Kiddee Case, and the lack thereof in the CRD. In his mind, the lack of ornamentation made the overall impression of the CRD seem more like a horned animal, whereas the ornamentation in the Kiddee Case highlighted its distinction from the former as a bug with antennae (or a tiger with ears), forming a wholly different impression on an informed user.

Intricate design or not, Trevor struggled with suitcases

The Supreme Court, again, agreed with Lord Justice Kitchin, confirming that "...the absence of decoration on the CRD reinforced the horned animal impression made by the CRD". Lord Neuberger did, however, consider that the inclusion of some ornamentation could potentially detract from the overall impression given as a horned animal, if sufficiently distinctive or eye-catching. This writer would wholly disagree with Lord Neuberger, and thinks that the lack of ornamentation should focus the inspection on the non-fanciful elements of the infringing product, and should not be included in the consideration of overall impression. What is important in the CRD is the shape or design of the product, and the lack of ornamentation should focus the assessment on just that, the design, rather than additional elements that can (arguably) be irrelevant to the design of an item, rather than its aesthetic appearance.

Lord Neuberger did address the appellant's concerns over the lack of ornamentation and its impact on a CRD (or in subsequent infringement actions), albeit obiter. In his mind the "... absence of decoration can, as a matter of principle, be a feature of a registered design" and that "...if absence of ornamentation is a feature of a registered design, that does not mean that because an item has ornamentation, it cannot, for that reason alone, infringe the registered design in question: it merely means that the fact that an allegedly infringing item has ornamentation is a factor which can be taken into account when deciding whether or not it does infringe that design".

His Lordship focused on the images as CAD images, rather than line drawings, and determined that the lack of ornamentation (although including colors and/or textures) would be treated as potentially distinguishing in the former, but not the latter. The inclusion of ornamentation reinforced the former point on distinction as different creatures, rather than be a full point of contention in its own right. He concluded that (again, obiter) "...the point of principle [is] that absence of ornamentation can be a feature of a Community Registered Design".

The two-toned coloring of the CRD

The final point of contention was Lord Justice Kitchin's disagreement in the use of tonal colors in the CRD, meaning the difference in color (gray and black) in some features, like the wheels or the strap on top. In his mind, the difference is an intention to include contrasting colors, rather than to simply distinguish the components, which implies a desire to use those contrasting colors in the actual registration as defining features. This brought into focus the color scheme of the Kiddee Case, further impacting the above assessment on its overall impression through these ornamental features. Arguably one can agree with the Supreme Court here, as the inclusion of different colors will be taken as that, even if the clear intention to differentiate the parts was not there at the time the application was drafted. Whether this is necessary or useful for the purposes of CAD drawings is beyond this writer's knowledge, but would be an interesting aspect of discussion if this is indeed the case.

Lord Neuberger agreed with Lord Justice Kitchin, and saw that the inclusion of contrasting colors in the registration (with or without the intent to do so) bares a need for the items to be compared in the same vein, i.e. through an assessment of not only shape, but color as well. He concluded that "...the design claimed in this case was for a wheeled suitcase in the shape of a horned animal, but that it was not a claim for the shape alone, but for one with a strap, strips and wheels and spokes in a colour (or possibly colours) which contrasted with that of the remainder of the product". The Supreme Court therefore upheld the decision of the Court of Appeal, and saw that the Kiddee Case did not infringe the CRD and made a different overall impression to the Trunki.

The Supreme Court also rejected a referral to the Court of Justice of the EU, determining that there is no question that requires answering, even in the light of the consideration that a lack of ornamentation could be a feature, which will remain a point of contention.

The case clearly will alter CRD practice, especially when CAD images are quite often used as the basis of the registration (with line drawings clearly being the preferred option from now on). What this writer finds perplexing is the lack of concrete answers, especially in the light of the question of a lack of ornamentation as a feature, and further laments the Supreme Court's rejection of a referral to the CJEU on these points. Lord Neuberger restricted his comments to obiter only, and a lack of referral will leave this question in the shade for the foreseeable future. Nevertheless, the Trunki saga has been an eventful one, and this writer has enjoyed the ride, but is saddened by the Supreme Court's lack of answers and an arguable wrong outcome.

Free to Sing - 'Happy Birthday to You' In Public Domain After Settlement

The recent saga dealing with the song 'Happy Birthday to You' has been discussed at length by many intellectual property commentators, including in this very blog here and here. The ownership of the copyright in the song, and the licencing practices surrounding it handled by Warner/Chappell, have been a big point of contention, with a recent ruling by the District Court of Central California declaring the copyright in the works to not reside with Warner/Chappell due to a lack of proper transfer of the rights to the ultimate entity. Warner/Chappell undoubtedly would have appealed the earlier decision, but the matter has since come to an abrupt end after a settlement between the relevant parties.

Per the Settlement Agreement, accessible here on Scribd, there are some terms of interest that must be mentioned.

The Settlement was a bitter-sweet end for Lisa

Section 2.1 of the Agreement mandates the establishment of a Settlement Fund, aimed at remunerating those who have paid licencing fees for the use of the song 'Happy Birthday to You'. The maximum amount allocated to the fund, if needed, would be $14 million, clearly demonstrating the understanding that there will be a considerable amount of entities with the relevant Settlement Class (considering that each licence is roughly $1500). This would include all persons who have paid such licencing fees since the 3rd of September 1949 (including, among others, to collecting societies or direct licences to Warner/Chappell). Even so, the realistic periods and sums of payment are set for two specific groups: payments made on or after the 13th of June 2009, or payments made before that date. The former group is entitled to all of their payments, but the latter only a share of 15% of what they have paid out. The difference, according to the claimant's lawyers, is due to the Statute of Limitations, enabling them to recoup some of their costs even in the absence of a proper claim due to the limitation period.

Additionally, section 2.2 sets out an express relinquishment of all claims of ownership over the song, and a requirement to no longer pursue any fee payments over the use of the song. Furthermore, the parties agree that the song is (under all likelihood, outside of any third-party claims in rights) in the public domain after the 8th of February 2016. However, Warner/Chappell did expressly defend their position in the settlement, and retained their position as the holders of the rights in the song. This seems to be mainly a point of principle, as the settlement does dictate that the song is in the public domain.

The Agreement also stipulates certain actions that need to be taken, such as the creation of a website and other administrative duties involved with the settlement and the payment of the settlement fees.

Arguably, the settlement is not much to write home about, but is an important illustration of the importance of challenging even the oldest, most well-known rights, when needed. The first instance decision set the tone for the settlement, and it shows in the one-sidedness of the Agreement, especially in the financial side of things. Nevertheless, the Happy Birthday saga has been an interesting one, and this writer, although underwhelmed by a settlement rather than a prolonged legal battle, is happy that we can all once again sing the song where ever and when ever we want.

Source: Ars Technica

Retrospective - Worldwide Injunctions on Search Results

Most of us, this writer included, take Internet search engines for granted, especially the research power they provide. Google, Yahoo and Bing offer a battery of tools to find nearly anything you'd want online, however, many of us would not be able to envision a world where their capabilities are restricted. The freedom of the Internet is one of its cornerstones, but it does cast a dark shadow through the very same freedom, for example, offering an avenue for those who wish to share, download and sell illegal materials with relative ease. In the same vein, those protecting their rights (or their online exposure, in lieu of any IP rights) undoubtedly would want to limit the capabilities offered by search engines, whether rightfully so or not. The question of injunctions over search results came to ahead in British Columbia, Canada, nearly two years ago, in a case that will be ultimately decided on by the Supreme Court of Canada in the near future.

The case of Equustek Solutions Inc. v Jack dealt with Equustek Solutions' technology that allows for industrial equipment made by two separate manufacturers to communicate with each other in a variety of ways. The defendants, Morgan Jack, Andrew Crawford, John Doe and Lee Ingraham (and their company Datalink), acted as distributors for Equustek's technology, ultimately conspiring to develop a competing piece of technology called the "GW1000", using their trade secrets attained through their role as distributors. Additionally, Equustek asserted that the competing technology used their logo and name, passing it off as the same (or similar) as the original. The use of the logo and the name (an the sale of GW1000) was conducted online by the defendants on their own website, selling the original product but switching it for their own equivalent once a sale had been concluded. Google, as a third-party, had nothing to do with the sale of the product, but they did display the infringing website as a part of their search results; however, refused to altogether block the defendants' website, voluntarily complying with only a part of the request made by Equustek. The plaintiff then sought a court order for the removal of the website from Google's search results altogether globally.

The Supreme Court of British Columbia then had to answer three questions: (i) Does this Court have territorial competence over a worldwide internet search provider such as Google?; (ii) if the answer to the first question is yes, should this Court decline to exercise jurisdiction on the basis that California is the more appropriate forum?; and (iii) Should the order sought be granted?

Roger Smith was preparing for the inevitable shut down of the Internet

The first question dealt with territorial competence, and whether the Court could rule in a worldwide capacity, especially against a US entity in Google Inc. (and its Canadian subsidiary). The starting point under Canadian law is to establish "...the existence of defined connections between the territory or legal system... and a party to the proceeding or the facts on which the proceeding is based". This, however, is assessed on a balance of probabilities based on submitted evidence, rather than a stricter evaluation of a connection. Due to the heart of the case being the misuse of intellectual property in British Columbia by Datalink, and the business therein, there would be a connection between the region and the proceedings (creating territorial competence under the Court Jurisdiction and Proceedings Transfer Act). Going against this, Google's operation of a website accessible in British Columbia would not, in itself, be enough to establish a firm connection. In the end, Justice Fenlon saw that, in the Court's assessment, Google had a connection with the jurisdiction through its advertising activities in British Columbia, and the active provision of tailored search results therein as well.

As jurisdiction was established, the Court moved onto the question of whether British Columbia would be the appropriate forum, or whether the Court would determine California to be more appropriate, as is allowed under section 11(1) of the CJPTA.

Justice Fenlon deemed that there was no out of court relief available to Equustek, as Google's takedown system was seen as inadequate and not an appropriate remedy to protect any future infringement or sale of infringing goods by the defendants. This established a firmer need to conduct the proceedings in British Columbia, but was not the only consideration contemplated by the Court, as section 11(2) of the CJPTA imposed further factors for considerations. While Justice Fenlon dealt with the majority of the factors briefly, however, she considered the likelihood of enforcement of an order in California at more length. What this writer has to note is the potential negative ramifications of this, and the excessive reach the reach of the question of jurisdiction. Justice Fenlon saw things differently, as, in her mind: "...[the order potentially] would give every state in the world jurisdiction over Google’s search services. That may be so. But if so, it flows as a natural consequence of Google doing business on a global scale". In the end the Court deemed that Google failed to prove that California would be the more appropriate forum for the dispute, and moved onto the final question on whether the order can be granted.

The final question hinged on two aspects: whether an order can be granted against a non-party (with Google being a third-party to the dispute), and whether this order should be made against Google in a worldwide capacity.

There are certain exceptions under Canadian law that allow for the making of an order against a third-party, namely if they have knowledge of a court order and deliberately disobey it, or if that order is necessary for the aiding of fact finding or the administration of justice in any given matter.

As Google were notified by the Court of an order to take down the websites in question, the first exception potentially applied. Although not deliberately done, Google had not complied with the order before the Court of Appeal proceedings due to an administrative oversight. Justice Fenlon also confirmed that the Court could potentially grant a Mareva order (a freezing injunction) in this instance under the second exception to enforce the order against Google. Concluding the Court's position in their ability to grant this order against Google, Justice Fenlon saw that: "...the Court has authority to grant an injunction against a non-party resident in a foreign jurisdiction in appropriate circumstances. The fact that an injunction has not before been made against an internet search provider such as Google is reason to tread carefully, but does not establish that the Court does not have subject matter competence".

The last question on whether the order ultimately should be granted remained as the Court's last point of contention.

The Court considered Google's submissions on why the order should not be granted, which focused on Google's role as a passive third-party and the sheer volume of material it indexes, making it difficult or nigh impossible to police it all effectively and efficiently. Additionally the removal of the websites (or websites in general) under an order would be tantamount to censorship, and that the order sought would be way too broad.

Justice Fenlon disagreed with Google, approving the order. In her judgment, the order would not require Google to monitor its online content or activities, but to simply comply with the order to remove the websites from its services. Google also have complied with the removal of offensive or other illegal content, such as child pornography, doing so at their own behest, clearly showcasing that the removal of the websites would not be censorship or go above and beyond what the service usually does. She also distinguished the potential effect of the order from the purpose of the order itself, even if it gives worldwide effect. The impact of an order is a valid consideration, however, it does not in itself prevent or affect the Court's ability to issue one (and often, this worldwide effect is needed, as in this instance). This would have to be assessed in the light of "...a strong prima facie... or a good arguable case... to cross the threshold, and then to balance the interests of the two parties, having regard to all the relevant factors in each case, to reach a just and convenient result". As Equustek clearly suffered irreparable damage due to the inclusion of the results, and subsequent sale of the goods, the order was deemed to be equitable under the circumstances.

The Court, as said above, issued the order, with Justice Fenlon summarizing the Court's final position succinctly: "The Court must adapt to the reality of e-commerce with its potential for abuse by those who would take the property of others and sell it through the borderless electronic web of the internet. I conclude that an interim injunction should be granted compelling Google to block the defendants’ websites from Google’s search results worldwide. That order is necessary to preserve the Court’s process and to ensure that the defendants cannot continue to flout the Court’s orders".

The case is an incredibly interesting one, with the up-coming Supreme Court decision adding an extra dimension of importance to this saga. The removal of search results is clearly a big point of contention, and should the Supreme Court follow the decision of the Supreme Court of British Columbia, Canada could become the next destination for intellectual property rights holders to better enforce their rights on the Internet. Although the decision will not necessarily change the Internet as we know it, it can have a major impact on the freedom in it (for better or worse) and this writer keenly awaits the decision of the Canadian Supreme Court.

Plain and Simple - Australia Wins Plain Packaging Challenge in Asia

Plain Packaging, the initiative to effectively remove all identifying markings (one could say the only distinctive features in tobacco), is a debate that has been raging on for years, with both sides voicing very valid concerns. Australia has been on the forefront of plain packaging, passing the Tobacco Plain Packaging Act 2011 over 5 years ago, and the Act has not been without its challenges. Currently there still are suspended proceedings at the WTO, initiated by Ukraine, over the legality of the Act (discussed, prior to the suspension, here); however, this has not been the only battleground the Act has been fought over in.

In a recent action in the Permanent Court of Arbitration, Philip Morris Asia Limited (Hong Kong) challenged the legislation under the 1993 Agreement between the Government of Australia and the Government of Hong Kong for the Promotion and Protection of Investments, which sets certain rules for both countries in relation to foreign investments from those countries. These are, inter alia, that "[e]ach Contracting Party shall encourage and create favourable conditions for investors of the other Contracting Party to make investments in its area" and that "[i]nvestors of either Contracting Party shall not be deprived of their investments nor subjected to measures having effect equivalent to such deprivation in the area of the other Contracting Party except under due process of law". The latter of the two is the more important argument, as Philip Morris argued that Australia infringed this Article (Article 6) through its plain packaging law. Additionally Philip Morris argued that the law did not treat their investment fairly and equally (as mandated by Article 2(2)).

Without discussing the merits of Philip Morris' case, Australia argued a lack of proper jurisdiction for the Court of Arbitration, as, among other factors, Philip Morris Asia had only acquired the full shareholding of their Australian counterpart after the introduction of the legislation, leaving them fully aware and accepting of the potential negative influence on their investment by the law's passing.

The Tribunal decided on this late last year (with the decision not having been published as of yet, due to confidentiality reasons, which this writer was waiting for) that it did not have jurisdiction to hear the case, and dismissed Philip Morris Asia's case.

The decision, albeit very low in substance of the intellectual property laws that underpin plain packaging, is an interesting one, and a worthwhile illustration of the power of international trade agreements. The Transatlantic Trade and Investment Partnership (TTIP) and the controversy surrounding it only makes this more pronounced, which could, potentially, afford similar routes for corporations to challenges laws that make like difficult for them. In any event, this writer found the case interesting, although underwhelming in its substance, and would have liked to see things debated in more length as to the actual law and its possible infringement of the Agreement.

Source: Sydney Morning Herald

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.