October 2015

1. General

New Zealand

Trans-Pacific Partnership Agreement Signed
The Trans-Pacific Partnership Agreement (TPP) has now been signed and published. The New Zealand Government has also provided a summary of its effects for New Zealand. The TPP is a trade agreement between Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Viet Nam.

The TPP is expected to come into force within two years, once countries have completed their domestic legislative procedures. Some commentators have expressed doubt that it will enter into force in some countries, with the USA being a notable example. It is not currently clear whether other members would enact or seek amendment to the Agreement if it does not enter into force in the USA.

Accession by New Zealand to the WIPO Copyright Treaty and the WIPO Performances and Phonograms Treaty are required before it can enter into force in New Zealand. Copyright protection in music recordings and films will change from 50 years to 70 years after they were made. Copyright protection for books, screenplays, music, lyrics and artistic works will change from 50 years to 70 years after the death of the author. New Zealand will also need to amend the Copyright Act to provide greater rights to performers of copyright works such as musicians and actors. Technological protection measures (TPMs), which control access to digital content like music, TV programmes, films and software will be enhanced by prohibiting circumvention unless narrow exceptions apply.

The Patents Act will require amendment to introduce extension of term provisions for unreasonable delays in examining the patent or getting regulatory approval for pharmaceutical patents. This will presumably be up to a maximum of 5 years. However, in practice it is expected that this will affect the patent term of only a small number of patents.

Accession to the International Convention for the Protection of New Varieties of Plants 1991 (UPOV 1991) is also prescribed. New Zealand currently has acceded to UPOV 1978. Under the TPP Agreement New Zealand has the option of either:
(a) accede to the UPOV 1991 within three years of the date of entry into force of this Agreement for New Zealand; or
(b) adopt a sui generis plant variety rights system that gives effect to the UPOV 1991 within three years of the date of entry into force of this Agreement for New Zealand.
New Zealand can also adopt measures it deems necessary to protect indigenous plant species in fulfilment of its obligations under the Treaty of Waitangi, provided that such measures are not used as a means of arbitrary or unjustified discrimination against a person of another Party.

It appears that no amendments are required for Australia’s intellectual property law, since the above amendments required for New Zealand are already part of Australia’s law.

2. Patents

Australia

High Court’s holds that Isolated Nucleic Acid is Patent Ineligible, but IP Australia Intends to Construe Exception Narrowly
The High Court of Australia has allowed the D’Arcy appeal against the patentability of isolated nucleic acids. Both the Federal Court and the Full Court of the Federal Court had upheld the patentability of isolated nucleic acids, with the Full Court holding that an isolated nucleic acid is chemically, structurally and functionally different from a nucleic acid inside a human cell. As such, the Full Court held that it qualified as a manner of manufacture since such isolated nucleic acids constituted an artificially created state of affairs for economic benefit.

However, the High Court allowed the appeal, holding that the invention claimed is not a manner of manufacture. While isolated nucleic acids with specified variations from naturally occurring nucleic acids are a product of human action, the High Court held that the information contained therein is still essentially the same as in the naturally occurring nucleic acids. Such a finding seems to create an exception to the principle, stated in the High Court’s 1959 decision NRDC v Commissioner of Patents, that an artificially created state of affairs giving economic benefit is sufficient for being a manner of manufacture.

In holding that isolated genetic material is outside the scope of a manner of manufacture it implies that finding otherwise would require legislative change. It is notable that the rejection of patentability in this decision is wider in scope than the US Supreme Court’s decision. The Supreme Court’s decision held that synthetically created strands of nucleotides known as complementary DNA (cDNA) could be patent eligible, while isolated DNA is not patent eligible. However, the High Court specifically rejected this distinction, holding that both are patent ineligible since they both contain essentially the same information as naturally occurring DNA.

IP Australia has launched a short public consultation on its proposed examination practice in light thereof. It is proposed that the following will not be patent eligible:

• Naturally occurring human and non-human nucleic acid sequences encoding polypeptides or functional fragments thereof - either isolated or synthesised.
• cDNA.
• Naturally occurring human and non-human coding RNA - either isolated or synthesised.

The scope of this exclusion is clarified by the following list which are proposed to still be patent eligible on account of not merely representing information coding for a polypeptide:

• Naturally occurring isolated regulatory DNA (e.g. promoters, enhancers, inhibitors, intergenic DNA)
• Isolated non-coding (e.g. "Junk") DNA
• Isolated non-coding RNA (e.g. miRNA)
• Naturally occurring isolated bacteria
• Naturally occurring isolated virus
• Isolated polypeptides
• Synthesised/modified polypeptides
• Isolated polyclonal antibodies
• Chemical molecules purified from natural sources (e.g. new chemical entities, antibiotics, small molecules)
• Isolated cells
• Isolated stem cells
• Probes
• Primers
• Isolated interfering/inhibitory nucleic acids (e.g. antisense, ribozymes)
• Monoclonal antibodies
• Fusion/chimeric nucleic acids
• Transgene comprising naturally occurring gene sequences
• Vectors/microorganisms/animals/plants comprising a transgene

Australia and Europe Increase Mutual Exchange of Patent Information
IP Australia and the EPO recently signed a Memorandum of Understanding involving amongst other things reciprocal access to patent information and a Patent Prosecution Highway (PPH). The reciprocal access to patent information will allow the sharing of existing work results, while the PPH will allow accelerated processing of corresponding applications that have already been examined in the other office. These measures are expected to speed up processing and reduce costs for applicants.

Europe

Validation of European Patents Possible in Republic of Moldova
European and PCT applications with a filing date on or after 1st November 2015 have the option of validating the European patent in the Republic of Moldova. From that date the Republic of Moldova will join Bosnia and Herzegovina, Montenegro and Morocco as non-EPO states that allow extension or validation of European patents.

3. Designs

New Zealand

Relationship Between Creative Sector and Copyright and Designs Studied
The Government recently released the Terms of Reference of a study to be undertaken by MBIE into the creative sector. The study seeks to gain a better understanding of the creative sector and how it interacts with the copyright and designs regimes. The study will culminate in a series of reports looking at how the copyright and designs regimes are used by the various creative industry subsectors in a changing technological landscape.
The study will follow the “life cycle” of the creative work. It will focus on those who are creating, producing, disseminating and/or commercialising works protected by copyright and designs, including those involved in the following subsectors: music; film and television production; gaming; software; written content and print; product design and architecture (including fashion and industrial design); and other visual content (including visual and performing arts, photography and advertising).

4. Trade Marks

Gulf Cooperation Council

GCC States to Adopt Uniform Trade Mark Law
The Gulf Cooperation Council recently approved a single set of provisions that from December 2015 will apply across all six GCC states. Individual applications in each state of the GCC will still be required, but they will be governed by the same provisions.

New Zealand

Expired Copyright Clears Way for Lacoste to Use Crocodile Logo Previously Owned by Competitor
In Crocodile International Pte Ltd v Lacoste [2015] NZHC 2432 Lacoste successfully appealed an Assistant Commissioner’s decision which had held that Lacoste had no intention to use the Crocodile logo in application 837027.

Historically, Lacoste was the first to market a Crocodile device on clothing, initially starting in Europe in the 1930’s. However, Crocodile International was the first to file in New Zealand obtaining registration 70068 in class 25 in the early 1960’s. However, Crocodile International never used that mark in New Zealand and in 1999 Lacoste filed a non-use revocation action, which resulted in settlement negotiations in which Crocodile International assigned 70068 to Lacoste. Application 837027 is for the identical mark and covers the identical goods as registration 70068. In the current case there were two central issues to determine. Firstly, Crocodile International asserts that Dr Tan, who initially created the Crocodile logo depicted in registration 70068, is the owner of copyright therein and that use by Lacoste in New Zealand would infringe. Secondly, Lacoste challenge the Assistant Commissioner’s finding that Lacoste had not established it intended to use that mark in New Zealand.

The Judge agreed with the Assistant Commissioner’s finding that copyright in the Crocodile logo did not subsist in New Zealand on account of clause 28 of Schedule 1 of the Copyright Act 1994. That clause states that copyright does not exist in artistic works created before 1st April 1963 that constitute a design capable of registration at the time the work was made. Crocodile International argued that the logo was not registrable as a design on account of the logo not being visible during use given that it was on the neck label. The Judge rejected that argument, holding that it was sufficient that the logo was visible at some point and impacted on the purchaser’s decision. In the alternative, the Judge also held that the claim to copyright would not be available on account of delay and acquiescence, given that Crocodile International could have previously filed a declaration of invalidity against registration 70068 on the basis of its copyright claim.

While Lacoste has not used the mark depicted in application 837027 it claims an intention to use based on its use of its own crocodile logo, which is the subject of several registrations. The Judge found this plausible, particularly in light of previous High Court Judges finding similarity of the essential features of the Lacoste logo and the Crocodile logo. This judgment does not conclude the dispute between the parties, as the Court of Appeal is currently considering Crocodile International’s appeal of the revocation action it lost in relation to registration 70068.

IPONZ Confirms 'Sandwich Mark' Policy
IPONZ has now amended it practice note relating to other special circumstances for overcoming a citation by explaining two circumstances in which applications will be allowed to proceed to acceptance on the special circumstances grounds of section 26(b).

In the first circumstance, where there is an intervening (or sandwich) mark that would otherwise be cited against a later application, the later application can proceed to acceptance if all of the following criteria are met:

1. The intervening mark:
   a. does not have an earlier filing date than that of the applicant’s earlier mark, and
   b. clearly conflicts with the applicant’s earlier trade mark, and
   c. is registered
2. The applicant’s earlier mark is not subject to proceedings
3. The applicant’s later filed mark is the same or a substantially identical mark, in respect of the same or very similar goods/ services, to its earlier trade mark registration

The applicant will need to agree to the following explanation being entered on the Register: “Section 26(b) of the Trade Marks Act 2002 applies because of prior rights from (enter IP number(s)).” The practice note further clarifies condition 3 by stating that the exception will not apply where the later mark has a specification that is much broader than the applicant’s earlier registration.

The second circumstance is where the owner of the mark that would otherwise be cited against a later mark had previously given consent to an earlier application for that mark. This is subject to the proviso that the goods or services of the later mark should not cover additional goods or services that create additional conflict with the goods or services covered by the potential citation(s).

Fantech Trapped by Their Own Pleadings
In Fantech (NZ) Ltd v Systemair Aktiebolag an Assistant Commissioner allowed an interlocutory application to amend the application for revocation while disallowing Fantech from filing a counter-statement or evidence.

Fantech only become aware of the revocation application after the time for filing the counter-statement and evidence expired. It claimed this was on account of IPONZ serving the application for revocation to a wrongly linked client ID. Despite initially contesting this with IPONZ Fantech decided not to request a hearing on the service issue, but instead pointed out that the revocation application had actually identified Systemair’s own application instead on Fantech’s and that this should be a fundamental flaw to the application. Systemair’s agents immediately filed an application under section 194 to amend the application for revocation on the basis of correcting a clerical error or obvious mistake. After IPONZ allowed the amendment, but declined Fantech’s request to file a counter-statement and evidence, the matter proceeded to a hearing.

Fantech primarily contended that the amendment should be refused for the following reasons: it effectively adds a ground of revocation; Systemair did not file any evidence supporting the assertion of a clerical error or obvious mistake; and if no counter-statement is filed regulation 96(2) provides that the Commissioner must determine the application on the documents filed by the applicant - which it claims means the original unamended application for revocation. Fantech also contended that the Commissioner’s discretion should not be exercised in favour of Systemair for the following reasons: the public interest favoured a substantive revocation action including full evidence; and that Fantech’s decision not to request a hearing on the service issue was influenced by the lack of valid grounds in the application for revocation.

The Assistant Commissioner found the defect in Systemair’s pleadings to be an obvious mistake and that the interests of justice favour allowing the obvious mistake to be remedied. Fantech should have preserved its position regarding requesting a hearing on the service issue instead of relying solely on the defect in the pleadings. Given that the mistake was obvious, Systemair did not need to file any evidence regarding how it arose. Given that the regulations allow applications for revocation to be amended the phrase “on the documents filed by the applicant” must include the amended versions of those documents.

In the event that the amendment is allowed Fantech argued that they should be allowed to file a counter-statement and evidence on account of regulation 11A(4). However, the Assistant Commissioner rejected this argument, since regulation 11A(4) only allows the opposite party to file an amended counter-statement. Given that Fantech had not filed a counter-statement it would not be possible for them to file an amended counter-statement.