April 2013
1. General
Guernsey
Guernsey First Jurisdiction to Specifically Provide Image Rights Protection
Guernsey, which is a UK Crown dependency, recently became the first jurisdiction to provide specific protection for image rights when its Image Rights Ordinance came into force. The Ordinance provides that the personality and images of a personnage (natural, legal or fictional) may be registered. The registrant then has the right to control the commercial use of both the personality and images of the personnage. In addition to conventional images, images for these purposes will also include the personnage’s name, voice, signature, likeness, verbal or facial expressions, gestures and other distinctive characteristics. Rights in respect of a natural person may be registered if the person is living at the time of the registration or died no more than 100 years earlier. Registration gives the right to control the use of any image of the personnage, although it will be easier to enforce the use of specific registered images. The term of the right is 10 years, subject to renewal. Derogatory use of a registered personnage is prohibited, but there are exceptions in the legislation for media reporting, parody and satire, artistic use and private or non-commercial use. Personality rights are capable of assignment, licensing and transmission on death. Registration is open to non-residents. Section 6 gives several grounds for refusal, including applications made in bad faith or where the images have become customary or established in current language, culture or cognizance, or in the bona fide and established practices of any trade.
United Kingdom
Consultation Paper on Groundless Threats Released
The UK Law Commission has released a consultation paper on proposals to reform the law of groundless threats in patent, trade mark and design right litigation. Current legislation distinguishes between acts of primary and secondary infringement. Primary acts of infringement are those closest to the trade source of the infringement and cover the making or importing of goods or using a process. Secondary infringement involves selling or advertising the goods. Primary infringers are excluded from the threats provisions, since their actions can do the most harm and they are more likely to be aware of the right and the fact that they are infringing.
In 2004 the Patents legislation was amended to include within the ambit of primary infringement the selling or advertising of goods by manufacturers or importers. The consultation paper recommends extending that provision to trade marks and registered and unregistered design rights. Also in 2004 the Patents legislation was amended to exempt threats made to secondary infringers where the primary infringers cannot be found. It is also proposed to extend this provision to the other IP legislation.
Currently the groundless threats provisions provide a remedy to a person aggrieved where: a threat is made without a genuine intention to litigate; there has been no infringement or the right is invalid. The consultation paper proposes to treat groundless threats as a form of unfair competition and to introduce a new and broader cause of action based on the Paris Convention.
It is also noted that groundless threats actions can also be used tactically to drive a wedge between legal advisers and their clients, since legal advisers who make threats on their client’s behalf are also liable for making a groundless threat. It is proposed that legal advisers should be protected from liability for such groundless threats. Comments are requested by July 17, 2013.
2. Patents
United Kingdom
Supreme Court Considers Difference Between Making and Repairing
In Schutz (UK) Ltd v Werit UK Ltd the Supreme Court held that whether a manufacturer makes a patented article was a matter of fact and degree and depended on context. In the earlier proceedings the Court of Appeal had to consider the relationship between manufacture and repair to determine if contributory infringement had occurred. Schutz had an exclusive licence to patents for intermediate bulk containers (IBC), which consist of outer protective cages suitably containing removable plastic inner bottles used for the transportation of bulk liquids. Werit supplied its own plastic bottles to Delta Containers, who then retrofitted the bottles into second-hand Schutz cages.
The Court of Appeal held that for the purposes of the statute acts of manufacture and repair are mutually exclusive. Any act of repairing would have to not constitute manufacture or making in order to avoid infringement. Whether repair avoids infringement would need to be considered on a case by case basis, although the more substantive acts of renewing or reconditioning would be considered infringement. The Court of Appeal held that the product (the IBC) ceased to exist when the bottle is removed. Hence, the insertion of another plastic bottle amounted to an infringing manufacture.
The Supreme Court overturned the Court of Appeal on this point. It noted that not every replacement of constituent parts amounted to making a new article rather than repairing it. In this instance the Supreme Court considered the bottle to be a subsidiary part of the patented article, which was evidenced by the expectation that the cage would last 5-6 times longer than the bottle. In principle, the purchaser of a patented article can expect to have clear control of it unless there is an explicit agreement to the contrary. Consequently, in the absence of such agreement and where the article includes a component that is easily replaceable and relatively perishable, the Supreme Court considered that it would not be unreasonable to conclude that the replacement of that component does not infringe.
The Supreme Court also held that the bottle does not include any aspect of the inventive concept of the patent. This ‘inventive concept’ approach was rejected by the Court of Appeal for being too uncertain, especially if it is unclear whether the inventive concept was in the cage alone or in the combination of bottle and cage. Instead, the Court of Appeal applied the principles endorsed by the House of Lords in United Wire Ltd v Screen Repair Services (Scotland) Ltd by asking whether the acts of the defendant amount to manufacture? However, the Supreme Court considered that an inventive concept approach was justified in this instance as the facts of the case are distinguishable from those in United Wire. In particular, in United Wire the replaced part had no independent identity from the retained part, whereas in this case the bottle is a free-standing item of property. Here there is a combination of two products, only one of which is significantly longer lasting, more substantial and contains the inventive component. Hence, the Supreme Court concluded that the replacement of the bottle amounted to an act of repairing.
United States of America
Being Capable of Infringement Insufficient for a Finding of Infringement
In Accent Packaging Inc v Leggett & Platt Inc the Court of Appeals for the Federal Circuit (CAFC) affirmed the district court’s finding that a device merely capable of infringement with alteration does not necessarily infringe. Two of Accent’s patents relate to a wire tier device that is used to bale recyclables or solid waste for easier handling. Claim 5 of one patent and all the claims of the other patent require a mount that permits pivoting through at least 90˚. Leggett’s device features a module that is removed by pivoting the cover approximately 68˚. The module is prevented from pivoting further by way of a safety latch. After failing to convince the Court that the safety latch device is inessential to Leggett’s device, Accent argued that Leggett’s device would infringe if the safety latch was removed, which can easily be done by the user.
The CAFC rejected this argument. The CAFC clarified that a manufacturer would be liable for infringement if a device is designed to be altered or assembled before operation so as to fall within the scope of a valid claim. However, the mere fact that it is possible to make such alterations is not sufficient for a finding of infringement. More particularly, that the safety latch is only fastened with screws does not evidence an instruction or intention for alteration or removal before operation. Rather, the evidence points away from removal, since the safety latch serves a critical safety and service function of maintaining the cover in an open and locked position during service or removal of the module.
3. Trade Marks
General
Google Stops Monitoring Adwords
On 23rd April 2013 Google stopped monitoring or restricting keyword advertising that use trade marks that it has been notified about by owners of trade marks in Australia, New Zealand, China, Hong Kong, South Korea, Taiwan, Brazil, and Macau. This now means that Google no longer monitors or restricts keyword advertising anywhere, since it had only been doing so in the above jurisdictions.
This change of policy followed promptly from Google’s recent victory in the Australian High Court, which found that Google is not responsible for the misleading use of its AdWords service by advertisers (see Pipers Bulletin March 2013). However, Google will continue to monitor and potentially remove adverts that use trade marks within their text if Google has been requested to do so by the owners of trade marks.
Consequently, where a trade mark owner considers that the use of their trade mark as an AdWord has created a misrepresentation or deceptive effect, they need to pursue that grievance with the advertiser rather than Google.
Madrid Protocol
Importance of Getting It Right First Time
The International Bureau has issued an information notice reminding applicants that a mark may only be considered as a mark in standard characters if it is designated as such in the international application. After the international application is filed it cannot be changed to include such a claim. The possibility of making a standard character claim when filing an international application was introduced in April 1996, and of course is subject to the corresponding national application being in standard character form.
While the international application cannot be subsequently amended to include such a claim, it may be possible for a standard character claim to be recognised by a contracting party.