The team is joined by GuestKats Mirko Brüß, Rosie Burbidge, Nedim Malovic, Frantzeska Papadopolou, Mathilde Pavis, and Eibhlin Vardy
InternKats: Rose Hughes, Ieva Giedrimaite, and Cecilia Sbrolli
SpecialKats: Verónica Rodríguez Arguijo (TechieKat), Hayleigh Bosher (Book Review Editor), and Tian Lu (Asia Correspondent).

Monday, 29 February 2016

Lord Justice Kitchin gleefully keeps us the right side up on "wrong way around" evidence in Fox trade mark appeal

Looking out for IP judgments sometimes requires
the help of the AmeriKat's fuzzy friends
There are often occasions where the AmeriKat spies an interesting decision that she would love to digest and share with readers, but then a shinier, more attractive IP decision takes her fancy.  The Court of Appeal decision in the Glee trade mark and passing off case was one of these cases that got bumped down her list.  However, the ever-dependable Kat friend, Eibhlin Vardy (A&O), has come to the rescue with her take on the Court of Appeal's decision:  
"Earlier this month, the Court of Appeal rejected an appeal and cross-appeal in the long running trade mark and passing off dispute between Comic Enterprises and 20th Century Fox (Comic Enterprises Ltd v Twentieth Century Fox Film Corporation [2016] EWCA Civ 41), previously reported on IP Kat here, here and here. The Court of Appeal considered certain issues afresh, and its reasoning is instructive, particularly in relation to 'wrong way round' confusion evidence.
To recap, Comic Enterprises provides stand up comedy, music, and entertainment in several venues in the UK which it calls 'glee' clubs. It holds a registered UK trade mark- dating back to 2001 - which consists of a series of two device marks (see below):

This trade mark was partially revoked at first instance for non-use, with the specification limited to the following services in class 41: "Live comedy services, night club and cabaret entertainment; music hall services; provision of live and recorded music; dancing; provision of facilities for comedy and music entertainment; production and presentation of live shows and displays and the presentation of sound recordings". At first instance, Fox challenged the validity of the mark on the basis that this contained a descriptive element but this was not pursued on appeal. In addition to its registered mark, Comic Enterprises promotes its business in the UK using the words 'glee', 'the Glee Club' and through marketing emails referred to as 'Gleemails'.
Since December 2009, Fox has produced the highly successful 'glee' TV show, a 'pop culture phenomenon', with accompanying DVD and album sales/downloads, and sales of glee TV merchandise in the UK.

At first instance, Mr Roger Wyand QC sitting as a deputy judge in the High Court held that Fox had infringed Comic Enterprises' trade mark under s10(2)(b) and s10(3) of the Trade Marks Act 1994, but that Comic Enterprises could not sustain a claim in passing off against Fox. Various remedies were ordered, including an injunction to prevent Fox using word 'glee' as the name of the TV series (except to say the show was formerly known as 'glee'). Fox appealed on the findings of trade mark infringement, and Comic Enterprises cross-appealed on the finding that there was no passing off in relation to the signs 'the Glee Club' and 'glee'.
Wrong way round evidence of confusion and s10(2)(b) 
There was a significant volume of 'wrong way round' evidence of confusion at trial. This came from a range of individuals who knew of Fox's TV series, and on seeing or hearing of Comic Enterprises' business, believed it to be connected to the TV series. Fox alleged that this wrong way round evidence weighed significantly in the judge's finding of infringement, when it should have been irrelevant to the issue of trade mark infringement both as a matter of fact and as a matter of law. Fox also alleged that the High Court did not address the dissimilarity of services for which the mark is registered, and those for which Fox used the sign 'glee'. 
Lord Justice Kitchin accepted that the judge's reasoning on the probative value of wrong way round confusion evidence was very brief in parts. In particular, he had not properly addressed whether confusion arose because of the similarity of the sign to the mark, and the similarity of the services covered by the mark (with its more limited specification) and those services in relation to which the sign had been used. The Court of Appeal reviewed this evidence in detail afresh, and made its own assessment as to whether the various witnesses would have been aware of the services being offered by Comic Enterprises.

The Court of Appeal's starting point was the statutory test. The question is whether there is a likelihood of confusion on the part of the public because the sign is the same as or similar to the registered mark and is used in relation to goods identical with or similar to those for which the mark is registered. The Court of Appeal reiterated that the interdependence principle should be considered as part of this assessment, i.e. a lesser degree of similarity between the services may be offset by a greater similarity between marks (and vice versa).
Not your average stag do....
The witness evidence put forward by Comic Enterprises was varied and provides light entertainment in itself. It included evidence from a marketing agent who had been invited to pitch for promotional work for Comic Enterprises' Nottingham venue, and who had wrongly assumed that there was a link with Fox's TV series. When the agent was ultimately engaged by Comic Enterprises, she adopted the slogan 'we are Glee and we're not on TV' to try and distinguish Comic Enterprises' Nottingham venue from Fox's TV series. Tourists in Oxford were spotted taking photographs of Comic Enterprises' Glee Club sign outside premises - likely due to an association with the TV series. One (presumably anxious) stag party participant had enquired, upon arrival at a Comic Enterprises' venue, whether it was going to be a 'singing and dancing' night because of confusion with Fox's TV series. Comic Enterprises encountered significant confusion surrounding its Oxford venue, and distributed 2,500 flyers to dispel any link to the TV series. 
The Court of Appeal determined that the wrong way round confusion evidence was admissible. Lord Justice Kitchin noted that the distinction between 'wrong' and 'right' way round evidence may be nothing more meaningful than the order in which a particular consumer happens to come across the mark and the sign. The Court should assess the probative value of wrong way round evidence in the usual way to determine whether it assists in answering the statutory question of infringement. This seems to be correct - there is nothing in the statute which dictates that the average consumer must consider the signs/mark and respective services in a particular chronological order.
On the facts, there was a reasonable degree of similarity between the mark and the sign, and although Fox maintained that there was a clear distinction between a recorded TV series and live comedy and music in terms of the services covered, this was rejected by the Court of Appeal (particularly given that Fox had itself sanctioned world tours demonstrating that live music and comedy shows can be complementary to a TV series). Fox also argued that the context of use of the sign was important, and it was far-fetched to suggest that consumers would think that Comic Enterprises would be behind the Glee TV series. Although the Court of Appeal agreed this was unlikely, it was much more likely that potential consumers of Comic Enterprise would conclude that Fox was linked to Comic Enterprises' UK entertainment venues.
Lord Justice Kitchin acknowledged that the assessment of confusion based on the degree of similarity between the mark and sign, and the degree of similarity between the services of the mark and sign, initially appeared finely balanced. However, the evidence of actual confusion put forward by comic Enterprises was potentially very persuasive, and supported a finding of likelihood of confusion and infringement under s10(2)(b) of the Act.
Infringement under s10(3) of the Act 
Lord Justice Kitchin - keeping us
the right way up about
the wrong way around
There was no challenge on appeal as to whether Comic Enterprises had reputation in the mark by late 2009. Fox argued that wrong way round evidence should be excluded, because infringement under s10(3) is based on the mark having a reputation in the UK and therefore infringement should be considered from that perspective. Again, the Court of Appeal disagreed, noting that it was inevitable that many consumers would come across Fox's TV series before they came across the mark, but the evidence before the Court demonstrated that the use by Fox of the sign was such that an average consumer would likely make a connection between the sign and the mark. Lord Justice Kitchin noted that "the protection afforded to a mark with a reputation extends beyond existing customers". The evidence showed that actual and potential customers were conflating the businesses of the parties, and affecting Comic Enterprises' ability to use the mark to promote its business, particularly in seeking to establish new venues in Nottingham and Oxford where it did not already have a significant customer base. The judge was entitled to find that potential consumers were changing their economic behaviour. The mark was suffering detriment because it was being swamped by Fox's use of the glee sign.
Passing off
The Court of Appeal confirmed the judge's finding that there was no passing off. In doing so, it noted that it is important to keep in mind the distinction between confusion and misrepresentation. Use of the sign in relation to Fox's TV series shows was likely to cause confusion, but this did not mean that Fox was guilty of any actionable misrepresentation. Kitchin LJ noted that the real problems concerning the use of the sign only came to light when Comic Enterprises launched new venues in Oxford and Nottingham after Fox's TV show was already up and running. The Court reiterated that the scope of protection in passing off is not the same as trade mark infringement. The decision of the judge at first instance to find trade mark infringement but not passing off was not inherently inconsistent on the facts.
Don't Stop Believin'
Mr Fox hasn't seen the inside of a court room since he beat
his manslaughter rap following Mr Wolf's
ill-fated demise
This is unlikely to be the final episode of this dispute. Fox alleged on appeal that the registered mark was invalid on the basis that s41 of the Act (which allows a series of marks to be registered) is incompatible with the requirement that a trade mark must be a 'sign' in the sense of being a single sign and capable of being graphically represented pursuant to articles 2 and 3 of Directive 2008/95/EC. At trial, Fox reserved this point for appeal, but to be advanced on a contingency only basis in the event that it was unsuccessful on other matters on appeal. During the course of the appeal hearing, the Court recognised that this point was of some general importance and may be of interest to the UK IPO, which was invited to make written observations on this point. Although the UK IPO responded exceptionally promptly to the effect that s41 was not incompatible with the Directive, the Court of Appeal decided to reserve consideration of this issue to a later occasion to enable the parties to respond to the UK IPO's observations. In addition to the outstanding s41 challenge, the thorny question of Comic Enterprises' damages or an account of profits remains."

Friday, 26 February 2016

BREAKING: No opt-out fees, as the UPC Preparatory Committee publishes decision on UPC court fees

The AmeriKat responding to her latest mobile reception
issue, but not to the welcome news of no UPC opt-out fees
The AmeriKat has been waiting for this day for a long time.  No, its not the day when she can get through an entire mobile phone conversation without someone losing reception, but the day when the UPC Preparatory Committee publishes the rules on UPC court fees and recoverable costs.

The UPC court fees rules are neatly set out in this document.  The Guidelines for determining the value-based fees and recoverable costs are set out in this document.  Although the AmeriKat has not had a chance to fully digest the provisions (which will be subject to follow-up report), she notes the following:
  • No opt-out fees.  The explanatory section of the rules document explains that this was one of the "few areas of clear consensus in consultation responses".  It continues: 
    "We now know much more detail as to how the proposed opt-out process will work and that the administration burden rests almost entirely with the applicant. We also know that any cost to the Court associated with the opt-out is related to processing the fee. There is no additional cost for the Case Management System to process opt-out requests if there is no fee. Requiring people to make payment generates costs for the court which would not be needed if there were no fee. So, removing the fee removes the cost; it also eliminates the problem of how to process payments particularly during provisional application and honours the commitment already made to only reclaim administrative costs for the opt-out."
  • Fixed Fees:  € 11,000 seems to be the number of the day for fixed fees.  It will cost €11,000 to sue for infringement, but €20,000 to commence a separate revocation action. It is €11,000 to counterclaim for invalidity.  The table on some of the fixed costs is below:
  • Value-based fees:  As set out in the Guidelines, the most practicable method for determining case value for an infringement action will be on an appropriate licence fee (although, the AmeriKat can already hear many saying "Impossible - we would never licence our patents to some parties!").   In those cases, a valuation based on the claimant's loss of profits or the defendant's profit's may be applied, but the document notes that this may bee too complex and could cause satellite litigation.  The additional value-based fees start at actions valued at and above €750,000 and are capped at €325,000 for those claims that are more than €50 million.  
  • Recoverable costs ceilings:  Although there is a question whether these include court fees, the maximum ceiling for recoverable costs for values of more than €50 million are capped at €2 million (cue every European patent litigator checking their costs budgets).  Parties may request a lowering of the ceiling, especially where cost recoverability may threaten the economic existence of a company.  

Why Mickey Mouse is not mickey mouse

A little while ago, I found myself describing some organization as a “mickey mouse” operation. It was not the first time that I had used the term
“mickey mouse” to describe something in an unflattering fashion and this Kat assumes that most Kat readers have also used the term in this fashion. Take any dictionary and one will find a one or more definitions for the term that convey this notion (e.g., as defined in the Urban Dictionary— “Substandard, poorly executed or organized. Amateurish”). But this time, I began to think: how is it that the name of Walt Disney’s iconic animated character became an accepted term of derision? It would seem, after all, that rare is the situation where an object so carefully cultivated to project a positive image, such as Mickey Mouse, has come to have such a negative connotation. In recounting this tale, we encounter a fascinating combination of how copyright transmogrified into a commercially valuable name and trademark mark, while in parallel the name entered the lexicon with such an uncomplimentary meaning.

First a little bit of history. Created in 1928 by Walt Disney and Ub Iwerks, the Mickey Mouse character first appeared in movie form that same year in "Steamboat Willie", one of the earliest movie animations with sound. According to Time magazine, which published an 80th anniversary piece on Mickey Mouse in 2008, the original name given to the character was Mortimer.
“The moniker didn't last; there are a number of tales attempting to explain how and why — the most popular being that Disney's wife hated the name and suggested its replacement — but soon he was ready for his debut as Mickey”.
After 130 movies, a long-running newspaper comic strip, comic books, video games, various merchandising products, a long-running television program, "The Mickey Mouse Club" (think Annette Funicello and Justin Timberlake), cable television, and his seemingly ubiquitous presence at Disney theme parks, Mickey Mouse has become the best known cartoon character in the world. Indeed, this Kat was present at the opening of Disneyland in Anaheim in 1955 (thanks to Mother and Father Kat), and he remembers nothing from that historic day other than the character of Mickey Mouse.

This is not to say that the figure has remained static. As described by Wikipedia
“Originally characterized as a mischievous antihero, Mickey's increasing popularity led to his being rebranded as an everyman, usually seen as a flawed, but adventurous hero. In 2009, Disney began to rebrand the character again by putting less emphasis on his pleasant, cheerful side and reintroducing the more mischievous and adventurous sides of his personality, beginning with the video game Epic Mickey.”
Along the way, both the visual character and the name, Mickey Mouse, have come to be valuable commercial properties. A check of the USPTO trademark database TESS reveals that the “Mickey Mouse” mark was first registered in the name of Walt Disney in 1928; this registration is still in force. Other registrations for the name have followed. As well, of course, the character itself has enjoyed long commercial success under various forms of intellectual protection. Whatever changes have been made to the character, there is Kat consensus that the character of Mickey Mouse enjoys a universal positive image.

And so the question—how do we account for the dictionary definitions, in various forms, which connote something inferior or half-baked? This Kat sought to find an explanation. While there appears to be agreement that it came into such use in the 1930’s, there is no consensus on the exact genesis. The most interesting thoughts on this issue were found on a November 11, 2002, entry on Google Answers, posted by “justaskscott-ga” as follows:
"There is a lot of speculation, and even some informed-sounding statements, on the Internet as to the origin of "Mickey Mouse" as a derogative adjective. Some think that it relates to the poor quality of Mickey Mouse watches. Another source traces it to American college students of the late 1950s, who would describe an easy course as "a Mickey Mouse course." Yet another goes back to World War II, where soldiers apparently referred to absurd army routine as "mickey mouse". But the true origin seems to be in the jazz world. According to the Online Etymology Dictionary (a source that I've found trustworthy in the past): "Mickey mouse (adj.) 'small and worthless' is from 1936, originally used especially of mediocre dance-band music, a put-down based on the type of tunes played as background in cartoon films ...."
The Urban Dictionary concurs with this conclusion, stating the term dates from— “1930-35; after the animated cartoon character created by Walt Disney, orig. with reference to the banal dance-band music played as background to the cartoons.”

Assuming that this explanation is the correct one, in then raises an interesting and more fundamental question: how did the specific reference to the quality of the background music to the cartoons expand to become a general term of derision? This Kat found no ready answer. More generally, how do we account for the fact that Mickey Mouse, the property, appears to co-exist along the use mickey mouse (and even in capitalized form) as a derogatory adjective? One reason, perhaps, is that the popularity of Mickey Mouse derives the cartoon character. While the name is important, at the end of the day, it is ancillary to the artistic core. It also points to the seemingly unlimited ways by which a name can take on independent meaning quite detached from its origins. The power of words and names goes far beyond the matter of reputation and goodwill.

Permit this Kat to conclude by bringing the closing lines to the song that brought each television episode of The Mickey Mouse Club to an end (at
least in this Kat’s Mickey Mouse heyday in the 1950’s).

“Now it's time to say goodbye, to all our company,

M-I-C, See you real soon!

K-E-Y, Why? Because we like you!

M - O - U - S – E”

Book Review: Patent Enforcement Worldwide

With the cover dedication, "in Honour of Dieter Stauder," Patent Enforcement Worldwide is the third edition of Hart Publishing's country reports on patent enforcement practices and litigation strategies. This edition offers coverage of the implementation of the European Enforcement Directive and preparations for the Unified Patent Court.

In addition to key jurisdictions in Europe, the text covers major economies in Asia and the Americas.  The US section, written by Timothy Maloney, unsurprisingly addresses the expense of litigation. He cites the American Intellectual Property Law Associations's 2013 statistic that the, "median cost of a medium-size patent lawsuit is approximately USD $3.5 million." Maloney argues that the high expense of lawsuits provides an incentive to design around asserted patents to limit potential liability.  'Designing-around' requires investment in R&D and innovation. This is an interesting argument - the higher the cost of litigation, the more incentive there is to innovate. Food for thought.

The first edition of the book was written in 2000 in honour of Dieter Stauder's 60th birthday. According to the preface, Stauder is credited with being one of the first scholars to note the role of enforcement for 'effective protection' of patent rights.  In Katanomist-approved fashion, his 1988 study on patent infringement in Germany, the UK, France and Italy used court data to provide empirical insights into litigation in practice.  His findings suggested a need for harmonisation. Stauder is the former head of the International Section of University of Strasbourg's Centre d'Études Internationales de la Propriété Intellectuelle (CEIPI) and now a practicing lawyer.

Edited by Christopher Heath, a Member of the Boards of Appeal of the EPO, this book addresses a hot topic and is a useful source of reference. Given the pace of change in patent enforcement in the last 15 years, this new edition required significant re-writes of earlier versions.  An impressive feat. If this Kat were to make any complaint, it is that the index is structured in a way that makes it difficult to research by topic (e.g. 'patent trolls'), as opposed to jurisdiction.

Hart Publishing has generously offered a 20% discount to IPKat readers. To receive the discount, please click on the ‘pay now’ button on the right hand side of this link. Once through to the ordering screen type ref: CV7 in the voucher code field and click ‘apply’.

Bibliographic information: Heath, C. (2015). Patent enforcement worldwide : writings in honour of Dieter Stauder. Hart Publishing. IBSN:1849467099.  Prices before IPKat discount: hardback: £95, e-book £67.

Friday Filppancy

Coca-Cola's shape mark too smooth for
the General Court
Coca-Cola falters in EU General Court on bottle shape trade mark:  On Wednesday, the EU General Court issued its decision rejecting Coca-Cola's Community trade mark application to register a 3-D sign for the contour of a bottle without fluting.  OHIM's Board of Appeal had previously rejected the application on the basis that it was devoid of distinctive character under Article 7(1)(b) of the CTM Regulation 207/2009.  The General Court, in affirming OHIM's decision, was unswayed that Coca-Cola's survey evidence proved that the mark had acquired distinctive character throughout the EU in respect of a significant part of the relevant public.  On the survey point the General Court stated:
"First, as regards the surveys relied on by the applicant, it must be held that the Board of Appeal was correct to find, in paragraph 51 of the contested decision, that those surveys were not capable of proving that the mark applied for had acquired distinctive character throughout the European Union in respect of a significant part of the relevant public. The surveys were conducted in 10 EU Member States, namely Denmark, Germany, Estonia, Greece, Spain, France, Italy, Poland, Portugal and the United Kingdom, even though the European Union had 27 Member States at the date on which the application for registration was lodged. It is true that the surveys in question concluded that the mark applied for had acquired a distinctive character in the 10 Member States where they were carried out, with the recognition rate being between 48% (Poland) and 79% (Spain); however, they did not establish that that was also the case in the other 17 Member States. The results of those surveys cannot be extrapolated to the 17 Member States in which no surveys were conducted."
So yet another warning on the value of survey evidence in trade mark proceedings.  If you are going to do them, make sure they show acquired distinctive character throughout the entire European Union.

Who is next on VirnetX's hit list?
Apple's $626 million patent troll battle:  Earlier this month, a jury in the Eastern District of Texas awarded $626 million damages to VirnetX Inc for Apple's willfull patent infringement of four patents said to be infringed by iMessage, FaceTime and other software. VirnetX, a patent holding company (many will read "patent troll") with about 80 patents in its portfolio sued Apple back in 2012.  During the first round, a jury had awarded VirnetX $368 million, but after Apple successfully appealed due to VirnetX's failure prove that the allegedly infringing feature was motivating consumers to purchase Apple's devices when it came to a question as to how to apportion royalties the Court of Appeals for the Federal Circuit vacated the damages award.  The case then went back to the Eastern District for retrial.  Unfortunately, the result was an increased jury award.   VirnetX is no stranger to Silicon Valley - having previously sued Microsoft (see here) and Cisco (which it loss - see here).

Oxford Nanopore Technologies' MinION
DNA sequencer - for when you
need to sequence DNA on the go!
Illumnia's latest lawsuit signals start of new gene-sequencing platform war:  On Tuesday, Illumnia announced in a press release that it commenced patent infringement actions with respect to US Patents Nos. 8,673,550 and 9,170,230 which they exclusively license from the UAB Research Foundation and the University of Washington.  The patents, goth entitled "MSP Nanopores and related methods" relate to methods for making and using nanopores as part of nanopore sequencing technology (a method for sequencing DNA - see article here).  The lawsuits, started in the US International Trade Commission (ITC) and the US District Court for the Southern District of California, have been brought against emerging UK-based company, Oxford Nanopore Technologies, one of the UK's highest valued companies who are developing and selling nanopore sequencing products. See district court complaint here and ITC complaint here.  Illumina, the giant in gene-sequencing, is reported to generate more than 90% of all DNA data.  The lawsuits mark the start of a battle of technology platforms with Illumina's larger sequencing instruments battling Oxford Nanopre's MinION - a much smaller, pocket-sized sequencing instrument (see picture here).  For an interesting analysis on the suit and Illumina's market position, see this illuminating (har!) blog post by Mick Watson (in his personal capacity - but also the Director of Ark-Genomics at the Roslin Institute, University of Edinburgh).  For more information, see this excellent article in MIT's Technology Review.

MARQUES - putting a finger on hot topic trade mark issues
Arbitrating trade marks and want to know more?  Look no further than the upcoming MARQUES course on 19 April 2016 that will examine the fundamentals of and practical tips on the issues on arbitrating and mediating trade marks.  The event, being held in London at the offices of Bristows LLP, will devote the morning to arbitration with insight provided by arbitrators and the Director of the WIPO Arbitration and Mediation Center, Leandro Toscano.  As the announcement continues:
"The afternoon session will consider the fundamentals behind mediation of trade mark disputes and when it might be appropriate. Delegates will hear the perspective of both a mediator as well as that of a lawyer representing a client at mediation and how a lawyer can help. How to mediate trade mark disputes in the US will be discussed and a speaker from OHIM will present about using their mediation service."
For more information please click here.

Thursday, 25 February 2016

AIPPI Report: Go ahead, make my day! Mr Justice Birss encourages IP litgants to use the new Shorter and Flexible Trial Schemes

The Patents Court may be even
busier when a rush of litigants enter into the
Short Trial Scheme.  But some judges
like being busy bees...
Yesterday evening, the AmeriKat could be seen spiritedly speeding up Farringdon Street to to the London offices of Hogan Lovells who were hosting the third of this year's AIPPI UK events.  The event's star attraction was Mr Justice Birss who spoke enthusiastically (and entertainingly) about the new Shorter and Flexible Trials Schemes.  In his sales pitch, Mr Justice Birss outlined the genesis and structure of the two schemes, emphasizing the attraction for litigants to benefit from IPEC-style procedures in big ticket litigation.  With thanks to Danielle Lawson (Freshfields LLP) for filling in readers on the evening:
"After an enthusiastic introduction, Mr Justice Birss explained that the Shorter and Flexible Trial Schemes are being run as a pilot, and therefore are initially time limited. They can be used in business cases issued between 1 October 2015 and 30 September 2017. “Business case” would include almost any IP case. The judge invited feedback on the schemes via the Working Group that set them up and will be monitoring them.

The two Schemes are set out in Civil Procedure Rules (CPR) Practice Direction (PD) 51N. They stem from different philosophies of case management. The Flexible Trials Scheme encourage increased party control; the Shorter Trials Scheme increases court control.

Shorter Trials Scheme
The shorter trials scheme (STS) owes a great deal to IPEC procedures but is available for parties and claims of all sizes. IPEC has proven very popular and anecdotally there has been a call for IPEC procedures to be more widely available in the court system. It is early days for the STS - so far only three or four cases have used the procedure.

Under the STS, hearings will be limited to four days including reading time, and judgment will be given six weeks of trial and within a year of issuing proceedings. There is a streamlined pre-action protocol, and the case is docketed i.e. the same judge hears the CMC and trial and deals with any applications (unless unavailable in the case of urgency). Disclosure and oral evidence will be limited, and cross-examination strictly controlled and limited to principal parts of the case. 
Claimants are free to specify that they wish to enter the STS when they issue a claim. The rules are clear that Defendants may apply for transfer out of the STS. A recent judgment by Birss J establishes that applications can also be made to transfer into the Scheme (Family Mosaic v Peer Real Estate [2016] EWHC 257 (Ch)). Unlike applications for expedition, there is no requirement to justify opting in to the scheme.

The working group (a group of judges monitoring the schemes) has decide that it would not be sensible or fair for costs budgeting to apply to the STS, which will instead follow IPEC’s method of summary assessment but without a costs cap.

Responding to questions afterwards, the judge confirmed that using the STS does not affect the court fees applicable to a case or the judges who would hear it.  As regards applications, he considered parties might make all the usual applications including for example expedition (i.e. you can expedite an already expedited procedure in the STS0, and that the date for trial set at the CMC would be a fixed date, rather than a window within which the trial date would float ["Finally, out-of-town clients can fix their travel plans earlier!"exclaims the AmeriKat]
Flexible Trials Scheme

The Flexible Trials Scheme (FTS) is an alternative to the STS. So far, it appears not to have been used. It allows parties to agree directions which the court will adopt provided they are reasonable. The FTS is based on the consensual approach adopted in arbitration. This might include limited disclosure and oral evidence and early identification of issues using written evidence. Responding to questions afterwards, the judge commented that the FTS might be used, for instance, to introduce Markman-type hearings or to define preliminary issues, or to provide to docketing – although not to a specific named choice of judge."
In closing, Mr Justice Birss also flagged other recent developments including the online filing system (which was noted to still be underused), Lord Justice Briggs' review of civil justice published in December 2015 (see in particular his comments on reducing the appellate court backlog by getting the High Court judges to do more appeal work), an online court for smaller cases and the proposal for specialist regional courts (a branch of the IPEC in Manchester or Leeds, for example).

One point that the AmeriKat will be interested in is as how paragraph 2.60 of PD 51N will be interpreted.  That provision states that "the Court of Appeal will seek to take into account the fact that a case was in the Shorter Trials Scheme..."  Although Mr Justice Birss did not opine on how it would be interpreted, the AmeriKat wonders whether anyone would argue that this means that the appellate court's general deference to a trial judge's findings of fact on the evidence should be watered down.  This is because, unlike in standard track procedure where the trial judge benefits from reams of evidence and cross-examination before him at trial, evidence and cross-examination is tightly controlled in the STS.  Therefore, would or should the appellate court perhaps plunge into the evidence more than normal?  Or, alternatively, will it mean not much of anything and is just a flag to the appellate judges that they should not read anything in the fact that the entire case was not put to a witness during the limited cross-examination when reading the transcripts?

In any event, the AmeriKat is excited about these schemes as it provides another tool in an English IP litigator's toolkit to adapt the best of English civil procedure in a way that can benefit the parties in terms of time and cost.  Last week, Eibhlin Vardy (A&O) reported on Celltrion v Biogen where the Patents Court is already implementing measures to ensure cases are done and dusted in a year (see Patents Court Practice Statement of 7 December 2015).  The STS and FTS therefore represent a further evolution in the English courts to increase the commercial attractiveness and competitiveness of the English litigation system, rivaling perhaps the UPC.

Wednesday, 24 February 2016

Blocking injunctions may be granted without need for claimant to demonstrate efficacy and dissuasiveness

Inside the box:
better a ring
or a blocking injunction?
Blocking injunctions in trade mark cases? Since the landmark 2014 decision of Arnold J in Cartier [here, here, here] (currently under appeal: the appeal will be heard on 13 April) it appears that indeed this type of measure is also available to trade mark owners.

IPKat readers will remember that the reason why this was uncertain is because - unlike what happened in relation to Article 8(3) of the  InfoSoc Directive (transposed into UK law through the adoption of s97A of the Copyright Designs and Patents Act 1988 (CDPA)) - UK Government did not take any measures to transpose explicitly the third sentence of Article 11 of the Enforcement Directive into its own legal system.

This provision states that: "Member States shall also ensure that rightholders are in a position to apply for an injunction against intermediaries whose services are used by a third party to infringe an intellectual property right, without prejudice to Article 8(3) of [the InfoSoc] Directive"

As Arnold J explained at length in Cartier, at the time of transposing the Enforcement Directive into UK law, UK Government believed that no action was needed in respect of the third sentence in Article 11 because s37(1) of the Supreme Court Act 1981 already allowed (and still allows) “[t]he High Court ... (whether interlocutory or final) [to] grant an injunction … in all cases in which it appears to be just and convenient to do so.”

Since the Cartier judgment not much has happened in the area of trade marks and blocking injunctions ... at least until yesterday, when HHJ Hacon (sitting as a High Court judge) issued his judgment in Cartier and Another v BSkyB and Others [2016] EWHC 339 (Ch) (Cartier II).

This was another application for a website blocking in which the claimants and defendants were the same as those in Cartier (or Cartier I), ie - respectively - owners of registered trade marks (CARTIER for watches and MONTBLANC for pens) and five major access providers in the UK.

Besides the vintage touch of referring to 'Community law' in lieu of 'EU law', HHJ Hacon deemed it correct to apply the principles set in Cartier I, despite the fact that that case - as mentioned above - is currently pending in appeal.

In Cartier I Arnold J took the view that in the context of a website-blocking application the exercise of the court's jurisdiction under s37(1) of the Supreme Court Act 1981 must be in accordance with Articles 3 and 11 of the Enforcement Directive and Article 12 to 15 of the Ecommerce Directive. These gave rise to four threshold requirements which have to be satisfied before turning to the court's discretion in the usual sense, ie:
    (1) The ISPs must be intermediaries within the meaning of the third sentence of Article 11.
    (2) The users and/or the operators of the website must be infringing the claimant's trade mark(s).
    (3) The users and/or the operators of the website must use the ISPs' services to infringe.
    (4) The ISPs must have actual knowledge of infringing activity. This means actual knowledge of one or more persons (who need not be identified) using the ISPs' services to infringe trade mark(s). It need not extend to knowledge of a specific infringement of a specific trade mark by a specific individual. An ISP may be given actual knowledge of infringing activity by receipt of sufficiently detailed notice of the activity and having had a reasonable opportunity to investigate the position.
If such threshold conditions are satisfied, then there are further requirements to be taken into account when considering whether to grant the injunction sought,including its efficacy, likelihood to dissuade, being not necessarily complicated or costly, being such as to avoid posing barriers to legitimate trade, proportionate, and being such as to contain safeguards against abuse.

HHJ Hacon deemed that all conditions above were met in the present case and granted the injunction sought by the claimants.

Among other things, the judge confirmed that (para 64) "there is no requirement for the claimant to show that blocking access to the target websites in issue is likely to reduce the overall infringement of his trade marks."

Tuesday, 23 February 2016

Battistelli falls out with Board 28

Merpel has been receiving a stream of rumour and hearsay since last week, indicating a serious bust-up between EPO President Benoit Battistelli and the members of Board 28 (the sub-group that runs the business of the Administrative Council). Notably, Mr Battistelli has apparently lost the crucial support of Mr Jesper Kongstad, the Chair of the Administrative Council, who had until now been one of Battistelli’s key defenders. The final meeting allegedly culminated in an ultimatum to Mr Battistelli to which he allegedly responded by walking out of the meeting.

Merpel has been slow to pass on these reports as she prefers to report verified facts and not mere unsubstantiated rumour. As a result much of the comment moderation over the last week on this site has involved repeatedly deleting well-intended reports of what the latest whispers around the EPO were saying – deletions which Merpel justifies on the basis that the whispers were not always in agreement and were rarely substantiated.

Merpel has however received from several sources, some of which are normally reliable, the text of a letter attributed to Mr Kongstad and addressed to the AC delegates. This draft letter is accompanied by a draft resolution for the AC to sign off on at its meeting in March. Merpel strongly suspects that the text which is being passed around the EPO is not the final draft that will be (or has been) sent by Mr Kongstad, but the gist of the communication is clear nonetheless.

Mr Kongstad’s draft letter to AC delegates

In his covering letter, Mr Kongstad explains that a series of meetings were held in February to address how Mr Battistelli has handled the high-profile disciplinary cases taken against staff representatives and his more general failure to engage with the Unions. He notes that this failure to engage with the Unions occurred despite the AC having made it abundantly clear that the social unrest in the Office was a high priority and despite the AC having committed to the President to a dialogue with the main staff union, SUEPO.

Mr Kongstad tells the AC delegates that Board 28 members have been unable to engage the President in a meaningful dialogue, and as a result they are resorting to addressing a formal request to the President through the AC. The situation has been brought to a head by very serious concerns at the political level about the proper functioning of the organisation.

Mr Kongstad recounts that the draft resolution was shown to Mr Battistelli at a meeting on February 17th, but Mr Battistelli rejected the document and questioned the legal basis for certain of the AC’s requests (see further below) before walking out of the meeting. Mr Kongstad drily notes that it is clear to Board 28 that the Council can make requests to the President without any legal obstacle whatsoever, and that in his view the President must positively respond to such requests. This is especially the case when the requests are ones to which no one is likely to object, such as suspending controversial pending disciplinary cases while an external review takes place.

A caveat on the draft resolution

The text of the draft resolution which Merpel has seen appears to be itself a draft of what is to be sent to the AC delegates to consider, and so she will refrain for now from posting it verbatim. She is satisfied however that it is genuine in the sense that the AC will be considering a resolution along the lines set out generally below at its next meeting.

Readers should note in any event that no matter what text the AC delegates actually get, the wording of any resolution will itself be up for discussion, and the full AC could accept, reject or amend the wording however it likes, so Merpel urges her readers to treat what follows as being merely a preparatory document.

The draft resolution

The text of the resolution seen by Merpel begins by setting out the reasons for the requests that follow, namely the ongoing social unrest, the repeated unsuccessful efforts to have the President engage with the trade unions, and the fact that the disciplinary actions taken against SUEPO leaders have exacerbated the problems of staff relations.

It also suggests – and this is something that Merpel had not seen before – that the AC is itself being hampered in its operation by not having sufficient resources in its secretariat, the implication being that Office management are starving the AC of adequate resources. (One suspects that they may have some sympathy for the Boards of Appeal who cautioned that if they had to depend on Mr Battistelli for the provision of supporting resources, they could never be properly independent.)

The specific requests then follow, the first and second of which were rejected by Mr Battistelli as lacking legal basis according to Mr Kongstad.

  1. Mr Battistelli is asked by the AC to agree to an external review of the disciplinary actions taken against SUEPO leaders.
  2. He is asked to suspend the disciplinary proceedings until that review is complete.
  3. He is asked to redraft the Staff Regulations and in particular to include amended sections covering the running of his investigation unit and how the disciplinary system operates.
  4. He is asked to conclude a memorandum of understanding with both SUEPO (the largest trade union) and FFPE-EPO (a smaller union based in the Hague), this being achieved without any preconditions and without ruling out any negotiating points.
  5. He is asked to submit new proposals by June 2016 for structural reform of the Boards of Appeal which take into account the agreed directions from the AC, their legal advice, and the comments of the Presidium of the BoA.
  6. Finally, he is asked to submit proposals by June 2016 for reinforcement of the AC secretariat, and following discussion with Board 28, he is asked to clarify the position of the AC in terms of governance.

Regarding the first two items, it is worth mentioning that the AC delegates will also have received in recent days a letter from the President of the Federation of International Civil Servants' Association (FICSA) containing a resolution calling on the AC to intercede with EPO management and to reinstate SUEPO officials Elizabeth Hardon and Ion Brumme, and to reverse the downgrading of Malika Weaver.

Regarding point (6), while seemingly more innocuous than the high-profile disciplinary issues and the reform of the Boards, this appears to Merpel to be potentially the most damning and difficult one for Mr Battistelli to address. He has challenged the authority of the AC in interfering with the disciplinary process, claiming that requests (1) and (2) are legally impermissible requests for the AC to make of the President. Merpel interprets this as a response from the AC, asking Mr Battistelli to clarify who he thinks is running the show.

Merpel suspects that if Mr Battistelli is determined enough he could continue to challenge the AC, up to a point. Article 4 EPC makes it clear that the AC and the Office are separate organs of the European Patent Organisation. The Office grants patents and does so under the “supervision” of the AC.

Regardless of “supervision”, however, the Office is “directed” by the President under Article 10 with the President being responsible to the AC for the activities of the Office. In terms of direction the President has significant powers granted to him under Article 10, including the disciplinary powers over staff members. So perhaps Mr Battistelli feels that this is his sole domain and that while the AC can only ask him to account for his actions it cannot direct him in the performance of his duties. However, he will also be aware, as will the AC, that the ultimate restraint on his powers arises out of the fact that he is himself subject to the disciplinary authority of the AC under Article 11(3) and is answerable to the AC for his running of the Office under Article 10(1).

There’s lots of scope for arguing fine distinctions between supervision and direction, discipline and powers, if one is minded to. However, Merpel wonders if taking such a position, or sustaining a challenge to the authority of the AC, is tenable for any President.

Loyal directors to the rescue?

In what appears to be a sign that Mr Battistelli is not going to bend the knee without some resistance, a remarkable letter has been drafted by those most loyal to Mr Battistelli addressed to the AC “from the management of the EPO”. This letter has, Merpel understands, been presented to EPO managers and directors for their signature – purely voluntarily, you understand.

The letter is drafted as an attempt to persuade the AC to vote against the resolution drafted by Board 28. While it studiously avoids mentioning Mr Battistelli it urges the AC to support “the Office” and to vote against the proposals of Board 28.

This letter of support says (and Merpel doesn’t joke about such matters) that the Organisation is “healthier than ever”. It warns that the proposal drafted by Mr Kongstad will undermine all EPO managers and will jeopardize the reforms that are underway. The AC should, according to this letter, focus on the Office’s “great achievements” and endorse the Office’s social dialogue, not criticise and undermine it.

Merpel does not yet know how many managers have signed the letter, or what the implications might be for either agreeing or declining to sign it. She will keep readers updated when significant developments occur.

Given the unprecedented implications of these developments, and the fact that feelings are running extraordinarily high, Merpel has decided at least for now to disable the comments facility on this post and she will be disallowing comments on other posts that address these developments. If readers have any concrete and verifiable further news to share, please email

AG Bot on the right of communication to the public in rehabs and the need for a 'transmission': is the end of Svensson in sight?

After hotels [here], dentist waiting rooms [here], and spas [here], it is now the turn of rehabilitation centres.

This morning Advocate General (AG) Yves Bot made a comeback to the copyright scene and issued his Opinion in Reha Training, C-117/15.

This is a reference for a preliminary ruling to the Court of Justice of the European Union (CJEU) from the Landgericht Köln (Regional Court, Cologne), seeking clarification on - guess what (once again) - the right of communication to the public. 

This German court is essentially asking essentially whether [the questions in full can be accessed here]:
  • the making available of TV broadcasts by means of TV sets on the premises of a rehabilitation centre falls within the scope of Article 3(1) of the InfoSoc Directive and Article 8(2) of the Rental and Lending Rights Directive;
  • and the concept of ‘communication to the public’ for the purposes of those two provisions must be given a uniform interpretation.
This reference has been made in the context of litigation between Reha Training (which operates a rehabilitation centre) and collective management organisation GEMA, arisen further to Reha Training's refusal to pay a licence fee in connection with the making available of protected works on its premises.

An opportunity for clarity

The AG noted at the outset how the CJEU has been asked on several occasions to interpret the concept of 'communication to the public', to which it has given a broad interpretation. 

To that end the Court has identified four assessment criteria:
  1. the existence of an ‘act of communication’ for which the role of the user is indispensable;
  2. the communication of a protected work to a ‘public’;
  3. the ‘new’ character of that public;
  4. and the ‘profit-making’ nature of the communication (according to the AG this is not however an essential condition).
The present case gives the Court an opportunity to reiterate and clarify its case-law on this subject, and this is why it will be decided as a Grand Chamber, with a composition of at least 11 judges presided over by the President instead of the usual chamber of 3 or 5 judges.

Like uniforms?
AG Bot does too
Uniform interpretation of the notion of 'communication to the public'

The AG began his analysis by considering whether the notion of 'communication to the public' should be the same in relation to different directives, ie the InfoSoc and the Rental and Lending Rights Directives.

Despite having different natures in the sense that - among other things - the right of communication to the public in the InfoSoc Directive is preventative while the right of communication to the public in the Rental and Lending Rights Directive is compensatory, the two notions of 'communication to the public' do not constitute a sufficient reason to justify recourse to different assessment criteria.

The Opinion does not really say why that should be the case, if not to satisfy the requirements of unity and coherence of the EU legal order and because in the past the CJEU has applied criteria referring to the InfoSoc Directive to cases relating to the Rental and Lending Rights Directive.

Both directives relevant in this case

The AG then addressed whether in a case like the one at hand the concept of ‘communication to the public’ must be assessed in the light of Article 3(1) of the InfoSoc Directive or in the light of Article 8(2) of the Rental and Lending Rights Directive.

He concluded that both are relevant, as not only the rights of authors as guaranteed by Article 3(1) of the InfoSoc Directive but also the rights of performers and phonogram producers as guaranteed by Article 8(2) of the Rental and Lending Rights Directive are at stake.

Availability of TV broadcasts in rehabilitation centres as an act of communication to the public

The AG subsequently turned to addressing whether a situation in which the operator of a rehabilitation centre installs television sets on its premises, to which it transmits a broadcast signal and thus makes it possible for television programmes to be viewed and heard by its patients, constitutes a ‘communication to the public’.

To answer this question, the AG considered the four assessment criteria listed above, held the vewis that in Del Corso the CJEU took a "strict approach", and concluded (unsurprisingly, in this Kat's view) that the case at hand is one in which the right of communication to the public is a stake. 

Can the mere possibility of accessing
the salami suffice
to calm Bertie's hunger?
Is transmission needed?

In this Kat's own opinion something fairly interesting is said at paragraphs 46 and 47 of the Opinion. 

First the AG noted how in relation to the '‘act of communication’, emphasis must be placed on the indispensable role of the user, who must act intentionally. 

Secondly, "the concept of ‘communication’ must be construed broadly as covering any transmission of a protected work, irrespective of the technical means or process used." 

This is interesting because in Svensson [Katposts here] - a case that the AG did not consider in his analysis - the CJEU appeared to reject the idea that a 'transmission' is actually needed for a link to be considered as falling within the scope of Article 3(1) of the InfoSoc Directive, in favour - instead - of the mere possibility that a link allows access to a work. 

At para 19 of its Svensson judgment, the CJEU stated in fact that it is sufficient that the “work is made available to a public in such a way that the persons forming that public may access it, irrespective of whether they avail themselves of that opportunity”.

This Kat suspects that this Reha Training case is less niche than what it seems, and may actually serve to inform and influence - first - the AG Opinion and - secondly - the Court's decision in another case currently pending, ie GS Media [linking to unlawful content, on which see here and here].

Is a revirement of the approach to linking and copyright in the post-Svensson era in the air? The last word appears indeed yet to be spoken.

Stay tuned!

Never too late: if you missed the IPKat last week

Away last week or too busy to read the IPKat? As usual, don’t worry because our friend and colleague Alberto Bellan is back with his Never Too Late feature, now on its 86th edition.

This is what happened on this very blog last week:

Nicola reviews the second edition of "Domain Name Law and Practice: An International Handbook, edited by Torsten Bettinger and Allegra Waddell, and published by Oxford University Press.

Igor Nikolic, a PhD student at University College London who is writing a thesis on FRAND licensing, comments on one of Mr Justice Birss' decisions in a series of cases concerning mobile phone technology and essential patents (Unwired Planet v Huawei and Samsung).

* In memoriam of Justice Antonin Scalia: something personal and something professional
Neil takes a brief moment to reflect on Justice Scalia, who was his law school professor at the times of University of Chicago Law School in the late 1970’s, and consider Justice Scalia's attitude towards IP. 

* English Patent Court speeds up, reminds Mr Justice Carr in Celltrion v Biogen
Celltrion Inc. v Biogen Idec Inc., F. Hoffmann-La Roche AG and Genentech Inc[2016] EWHC 188 (Pat)  is about the most recent practice direction which aligns the UK regime with the fast-approaching UPC's stated intention that all cases will be done and dusted within a year. Katfriend Eibhlin Vardy (A&O) analyses the decision.

* The design-copyright interface: the Italian Supreme Court rules on street furniture
Former Guest Kat Valentina Torelli reports on a recent decision by the Supreme Court of Italy regarding copyright and design law overlaps.

With regards to the unitary patent, a number of questions regarding dual protection arises. First, do the national provisions regarding double patenting under the EPC extend to unitary patents? Secondly, how should the relationship between "duplicate" unitary and national patents be regulated? Mark has some ideas about that.

As David's post on Regeneron Pharmaceuticals Inc v Kymab Ltd & Anor [2016] EWHC 87 (Pat) clearly shows, mice have a very special relation with patent case law. 

Over the past week or so, it has been widely reported that due to a recent Indonesian Supreme Court decision cancelling two IKEA trade mark registrations for non-use, Inter IKEA Systems B.V. had ‘lost its rights to the IKEA trademark in Indonesia to a local company’ and ‘would have to change its name’. Well, not really, say Prudence Jahja and Andrew Diamond of Januar Jahja & Partners, Jakarta, Indonesia.

* Will you stay or will you go? Mrs Justice Rose is go go go in Lilly v Janssen stay application
Stays of proceedings are not easy in UK courts, as Janssen found out last week in Eli Lilly v Janssen Sciences [2016] EWHC 313, where Mrs Justice Rose refused to stay Lilly's revocation and declaration of non-infringement (DNI) action brought against Janssen's divisional patent - EP (UK) 2 305 282. Annsley tells all.



Never too late 83 [week ending on Sunday 14 February] – Indigenous IP | Arnold J's latest judgment flags down the iconic London black cab | Life of a national/EU trade mark ... in a map | A comprehensive explanation of trademarks | Actavis v Lilly.

Never too late 82 [week ending on Sunday 7 February] – PhD Student Seminar at CIPA | IP meets Antimonopoly law in Japan | German Federal Patent Court invalidates 80% of litigated patents | Inquiry as to damages: no longer a rare avis? | US trade secrets | Trends in IP Data | EPO's new Chief Economist | GIFs and copyright | Katcall for new positions in the IPKat team | Star Wars IP.

Never too late 83 [week ending on Sunday 31 January] – The AmeriKat from the Silicon Valley | INGRES conference on developments in European IP law 2015 - patents | Economics of UK creative industries |Stretchline v H&M | Merck KGaA v Merck Sharp & Dohme | Ethics in IP | Social dialogue at the EPO | Ms Potter's extended copyright | CJEU on TMs' genuine use | Replicating works in museums.

Never too late 82 [week ending on Sunday 24 January] – Economics of legal professions | One shot to boost your EU trade marks | AG's opinion on fair compensation | Enforcement Directive consultation and UPC | Armonised grace period | Draft UK Legislation on Unitary Patent and Unified Patents Court | Arnold J's ruling in KitKat | Linking and copyright | GE moves to Boston.

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