Black Sabbath trade mark dispute settled

Hat tip to Stephen Baird  and through him to Mark Malek of Tactical IP for news that Ozzy Osbourne and Tony Iommi have settled their dispute over ownership of the Black Sabbath trade mark, which Iommi had registerd in the US and elsewhere (see earlier post). Mark's full story is here. There's a link to the report on spinnermusic.co.uk somewhere here too but it's using a Blogger feature that I haven't tried before so I am not sure how it will appear. Oh, here it is just in case - I can't work out how this "enclosure link" thing works.

"Subject to contract": not always reliable

The words “subject to contract” are commonly used to stop a binding agreement being created, but they aren’t the end of the story. The question is whether the parties intended to create legal relations, so using those words will often show they didn’t have that intention. Where the parties contemplate making a written agreement, whether they intend not to be bound until it is signed depends on the facts.

Investec Bank v Zulman [2010] EWCA Civ 536 (18 May 2010) concerned an oral agreement to amend a guarantee. The draft amended guarantee did not contain the magic words. The Court of Appeal held that this omission did not necessarily mean that the respondents intended the oral agreement to be legally binding. Longmore LJ observed that the surest guide to the parties’ intentions was the draft documentation, and here it stated that the respondents should seek independent legal advice before entering into it. It had to be signed by them before they could be bound otherwise this provision would have been pointless: if the respondents were bound by the oral agreement: they could not have refused to sign when they received that legal advice.

Other recent cases show how much the facts determine the outcome. In Bear Stearns Bank Plc v Forum Global Equity Ltd [2007] EWHC 1576 (Comm) (05 July 2007) the Commercial Court found the necessary legal intention to be bound in an agreement to make a distressed debt trade, even though the settlement date was not agreed. Agreements of that sort were almost always concluded orally. In contrast, in Yeoman's Row Management Ltd & Anor v Cobbe [2008] UKHL 55 (30 July 2008), the House of Lords found that an oral agreement “in principle” to redevelop and dispose of property was not binding because it was insufficiently certain: various aspects of the agreement remained to be settled by future negotiations, and until these matters were settled the parties regarded each other as only honour-bound. Take care to know exactly where things stand.

Car designs - guest post

Interesting guest post, by kind permission of my old mate Dave Musker (Class 99 blog) featured on my Blog Exemption blog because it seemed the best place for it - here. Or read the original here.

An affidavit is all that's needed

In a decision in Case R 1153/2009-1 given on 27 May 2010 mentioned in the latest Alicante News, the First Board of Appeal held that genuine use may be proved with nothing more than an affidavit by an employee of the party required to prove it. There is no need for supporting evidence, if the affidavit is detailed and convincing. Alicante News says: ‘The Board held that that doubts concerning the trustworthiness of the declaration may always exist but must be based on objective elements, such as the existence of contradictions in the declaration or of manifestly implausible statements or suspiciously vague or reticent wording.’ The declaration was made by the managing director of the opponent, and far from this raising questions about his impartiality (which is how the opposition division looked at it) the Board considered that he was simply the best person to provide this evidence. It said:
The Board does not share the Opposition Division’s position that declarations which contain sales figures should be proved with invoices because the declaration, provided it complies with the formal and substantial requirements listed above, is already proof. In addition, as the opponent suggests, since it would be easy to produce fake invoices (or falsify genuine ones), the submission of invoices would not increase substantially the reliability of the declaration.

IP Quester

Writing my IP dictionary brought me into contact with many people I hadn’t met before (and produced many encouraging comments). One such new friend is Erwin Cortagerena,from Argentina, of Equerion Information Services Corporation who has introduced me to his company’s IP Quester Online information service. The service now forms part of – perhaps it forms the whole of – the Lexis Nexis Global IP Law Service, information about which is here. It’s a huge database summarising the basic principles of intellectual property laws in just about all the jurisdictions of the world.

You can search through it in several ways – it’s divided into different areas of IP law, to start with, and of course split up by jurisdiction. So if, for example, you wish to remind yourself of the legal effects of a trade mark registration in the UK, you can select the relevant entries and the answer is displayed, albeit written in Globish – but that’s surely the right language for something like this.

The volume of material is vast – over 13,000 pages of proprietary content. It has all been created in-house by Equerion, and maintained by a dedicated professional team. It’s been going since 2001, and draws on over 300 information sources and 100 law firms. However, it seems to me that it’s strictly a first reference - it doesn’t provide references, or hyperlinks to primary sources, but that’s not what practitioners need anyway. I am a great believer in the ability of the Internet to deliver this sort of basic content very efficiently: far better than sending a message off to an associate several time zones away – although you’ll probably have to do that too.

DNA must be doing its (patented) job

Genetically modified crops are nothing if not controversial. There is at least a school of thought (represented here) that views modifications – at least some of them – as tools to boost demand for herbicides. If the crops are resistant, farmers can drench everything else with the stuff and save a lot of labour-intensive and therefore expensive work. Crop yields are improved – and so too are those of the herbicide makers. Case C-428/08, M onsanto Technology LLC v Cefetra BV and Others arises from ‘the mother of agricultural biotechnology’ ( ibid) attempting to use its Roundup Ready soybeans patent to stop soy meal from Argentina containing the DNA sequence protected by the patent being imported into the EU. The Dutch court where the infringement proceedings were brought referred several questions to the Court of Justice, the most important concerning Article 9 of Council Directive 98/44/EC:

The protection conferred by a patent on a product containing or consisting of genetic information shall extend to all material ... in which the product [is] incorporated and in which the genetic information is containedand performs its function.

Advocate General Mengozzi proposed a narrow interpretation. DNA sequence patents should not be treated like any other patents, but rather the protection given by them should be ‘ purpose-bound’.

... a DNA sequence must be regarded as protected, even as a self-standing product, only where it performs the function for which it was patented. In other words, it seems to me that Directive 98/44 permits and, in fact, requires an interpretation to the effect that, in EU territory, the protection conferred on DNA sequences is a ‘purpose-bound’ protection. Even though the directive does not expressly indicate that the protection to be conferred on DNA sequences must be of that order, many elements connected with the overall system of patents for biotechnological products militate in favour of that interpretation. Opinion, paragraph 29

T he DNA sequence was not performing its patented function (protecting plants from Roundup) at the relevant time because it was found in soy meal, not in plants. Of course, it had once been in plants and had done the job then, and because the meal could be used to grow plants it could do the job again, but at the key moment it wasn’t, and couldn’t .

To go the other way would give patent owners disproportionate and excessively wide protection, and bring ‘an unspecified number of derivative products’ under the control of the patentee. Germany and France already have purpose-bound protection for human DNA sequences, and second use claims for pharmaceutical products where a substance has already been patented are pretty common.

The Court agreed with the Advocate General:

Article 9 ... is to be interpreted as not conferring patent right protection in circumstances ... in which the patented product is contained in the soy meal, where it does not perform the function for which it is patented, but did perform that function previously in the soy plant, of which the meal is a processed product, or would possibly again be able to perform that function after it had been extracted from the soy meal and inserted into the cell of a living organism.

The Dutch Court also asked:

• whether patent protection under the Directive is exhaustive or whether national law could confer additional protection (the Court of Justice said it was exhaustive);
  
• whether the Directive should be applied retrospectively to patents granted before the Directive came into force (the Court said it did); and
  
• whether TRIPS should be taken into account for the purposes of the first three questions (the Court said it had no effect on the interpretation of Article 9).
  

Software patents in New Zealand - not

An interesting contribution to the debate on software patents: changes to the New Zealand patent legislation might exclude software from patentability completely, according to a report in The Register. At present this is just a recommendation of a Select Committee after a review of the Patents Bill, which is designed to bring the law - currently found in the Patents Act 1953, based on the UK Act of 1949 - up to date. The Select Commmittee suggests the phrase: “A computer program is not a patentable invention”. No weasel words like "as such", then, but I suspect still lots of scope for argument about when a patent protects the software and when it protects a new machine controlled by the software.

Turning to my running friends from NZ, there's more here from Hudson Garvey Martin - informative - and yet more here from my old friend Matt Sumpter at Chapman Tripp, taking the view that this would stifle innovation. It's an arguable position, of course, but not a very fashionable in the software field where to my mind excessively wide patents bring the whole patent system into disrepute.

Post-term restrictive covenants in franchise agreements

Restrictive covenants or non-compete obligations are essential devices to protect intellectual property (in the broadest sense), so a case concerning them is not exactly off-piste for an IP blog. They are the only way a business can stop employees using the information in their heads after they leave, and they can also be important in other types of agreement. In Pirtek (UK) Ltd v Joinplace Ltd (t/a Pirtek Darlington) & Ors [2010] EWHC 1641 (Ch) (07 July 2010) the High Court upheld one in a franchise agreement.
The key questions when deciding whether such a clause is enforceable are whether it is reasonable, and whether it is prohibited by competition rules (and if so whether it is exempted). In principle restrictive covenants are restraints of trade, and restraints of trade are only tolerable if they are reasonable. They will be permitted under common law if they are necessary for protecting the covenantee's interests (my words) - the judge in Pirtek stating that the common law is concerned with protecting goodwill rather than technical or business know-how. That statement might be rather broad - there are plenty of cases where it seems to be know-how of one sort or another that was being protected - but perhaps the simple fact is that there is not much mileage in trying to draw a distinction between the two. Anyway, it is common to find such restrictions analysed under this rubric - though statutory rules on competition will also be applicable, and here they were more important than the common law doctrine.
Here, the judge considered that the restrictions, which lasted for a year and covered County Durham, were reasonable as far as the common law was concerned. However, under the Competition Act 1998 it was a different matter. The restrictions were necessary to protect the franchisor's know-how, so they would not even be prohibited under Chapter I of the Act as restrictions on competition: this was the approach of the Court of Justice's judgment in the key franchising case, Pronuptia de Paris GmbH v Pronuptia de Paris Irmgard Schillgallis [1986] EUECJ R-161/84 (28 January 1986). Which is not to say that such restrictions will always be OK, but at least we can be sure they will sometimes work - provided always they go no further than necessary.

Jurisdiction clauses in internet terms and conditions

There is a paucity of case law on the effectiveness of terms and conditions used on the Internet. Not surprising, in one way: consumers aren't going to fall over themselves to take action against website operators - or vice versa, especially as there doubt about whether the terms and conditions are enforceable in the first place. There is  now an Irish case on the effectiveness of a jurisdiction clause, which tells us something about the value of website terms and conditions in general.
The case is Ryanair Ltd v Billigfluege.de GmBH [2010] IEHC 47, a High Court judgment in which the claimant took exception to the defendant's "scraping" activities to provide material for its price comparison website. This involves collecting information from another person's website for use on your own, and it was in breach of the terms of use on the Ryanair site which were linked in the usual fashion from the home page. Presumably it is not the sort of extra that Ryanair would permit on payment of a charge. The judgment was on a preliminary application in which the defendant sought to have the claim dismissed for want of jurisdiction by virtue of the provisions of Regulation 44/2001 on Jurisdiction and the Recognition and Enforcement of Judgments in Civil and Commercial Matters (“the Brussels Regulation”) as transposed into Irish law by the European Communities (Civil and Commercial Judgments) Regulations, S.I. No. 52 of 2002. Its argument was that Article 2 of the Regulations insisted that proceedings should be brought in the defendant's domicile.
Article 2 does indeed provide just that, but there are exceptions to it. In particular, Article 23 envisages the position being modified by agreement, so the question became one about the enforceability of the terms and conditions - had a legal relationship been created?
 The Court held that there was a binding contract: the terms were “fairly brought to the attention of the other party”, clearly visible and not concealed in any way. In an earlier case involving the same claimant, Ryanair Ltd. v Bravofly and Travel Fusion Ltd. [2009] IEHC 41, the Court had held that if a contract containing a jurisdiction clause is held to be void and unenforceable, the Court will be guided by the jurisdiction clause when determining issues of jurisdiction
The fact that both parties were commercial concerns is of some importance: a court would be less likely to make a consumer submit to the jurisdiction of a foreign court. Commercial entities would be assumed to understand better than consumers how website terms and conditions work, and - of course - the defendants had terms and conditions on their own website.There was no "click-wrap" licence here, but the defendant's repeated use of the claimant's website, with teh terms being present, was enough to convince the court.

Groundless threats

Best Buy Co Inc and another v Worldwide Sales Corporation Espana SL [2010] EWHC 1666 (Ch) is a High Court case in which Mr Justice Floyd considers section 21 of the Trade Marks Act 1994. This gives protection from threats of certain types of infringement actions - the IPKat has more detail if you want it - which I explain to delegates on my courses by saying that it is designed to stop big businesses stopping activities they don't like (which may or may not be trade mark infringements) by threatening small people. So, if the rights owner goes to retailers and threatens to sue if they continue stocking goods made by someone else, and the retailers decide they can't afford a fight even if they are not averse to having one, an action might lie. The retailers could sue, but so too can any person aggrieved by the threats - the manufacturer or importer who suddenly finds no-one prepared to stock his goods being the obvious beneficiary of this provision.
This case is interesting in a number of respects. First, it considers what amounts to a threat, and takes a broad view, as previous cases have done. Here, so long as the threat was broad enough to encompass proceedings in teh UK (whether based on a UK or a Community trade mark) that was enough.
Second, though very much on the facts of the case, the recipient would not have understood the threat to be limited to supplying services, one of the types of infringement excluded from section 21.
Third, though, the letter containing the threat was written in the course of negotiations about a co-existance agreement and was expressly without prejudice. It could not be used in evidence for that reason. This seems a little harsh, but only because it appears that it was only the second communication in the negotiations - the claimants wrote floating the possibility of a co-existance agreement, and this was the defendants' reply. However, the letter did also respond to points made by the claimant, and the judge was not prepared to slice it up and consider only the threatening parts. "Viewed as a whole, and in the context of what preceded it, it was a comprehensive negotiating response to [the claimant's] proposal."
Owners of all manner of intellectual property (except copyright) must take not to make threats without good reason. At least it seems they don't need to worry about what they might say in the course of a settlement negotiation.

Privilege and Property

Open Book Publishers promise a new approach to academic publishing, and offer readers a choice of buying a printed copy of a book or downloading a pdf at about one-third of the paperback price. Privilege and Property is available from them (here) for a mere £4.95, or £14.95 or £24.95. It's a collection of essays on the history of copyright, the work of 15 well-known academics in the field. If I could stand reading books on screen, I'd go for the pdf - as it is, I'll stick to paper. Especially for 450 pages!

Vuvuzela trade mark

I read on the IPKat blog that CTM no 4140075 protects the word VUVUZELA, and has done since 2004, although one might question the fact that it's registered for "musical instruments" - a non-use argument there, perhaps ... although it also covers "Games and playthings, toys, sporting articles", not quite the Nice Classification heading in the latter case (the former certainly is) but surely unjustifiably wide considering what the mark is used for. Trade mark owners, and their advisers, should not be able to get away with these sweeping lists of goods and services.
In the case of VUVUZELA, perhaps the issue doesn't arise because it might well have suffered genericide already: the word certainly seems to be used in the trade as well as by ignorant consumers. If that's the case, it's an appropriate if accidental sanction to punish what appears to be an avaricious land-grab by one manufacturer. In any case, according to Wikipedia, it's a descriptive term, meaning "stadium horn" (though it doesn't say in which langauge).

The Kat also points out three more CTM applications for a variety of other goods. Stadium Horn wine? I don't think that's going to fly off the shelves.

Musicians' names as trade marks

Two interesting developments involving the use of musicians' names as trade marks within a few days of each other. In one, reported here by Out-Law.com, Frank Zappa's family trust has failed in a claim to stop the organisers of a festival dedicated to the great man using her registered trade mark. In another, the niece of the Spanish composer, José Padilla (died 1960), has failed in her attempt to stop the registration of the trade mark JOSE PADILLA by - erm - José Padilla. Another one. There are several famous ones around, including a US citizen convicted of aiding terrorists. He has nothing to do with the trade mark case. The gentleman who is involved is a DJ.

In the latter case, the opposition failed because the senior trade marks - Spanish national ones - had not been used as trade marks for the goods which were marketed in connection with the name. I think this means that the name of the composer of a piece of music is not an indication of the origin of the CDs or whatever on which the music is recorded, and on the basis that the commercial origin of those goods is a record company this seems right. And in the other case much the same was true of the Zappa trade mark - it had not been used as a trade mark in the European Union, or perhaps just in Germany - there is a CTM (in fact a couple) but there are also several German trade marks and the reports are not entirely clear. Anyway, the only use made of the mark appears to have been in a website address, and although goods were sold from the website they weren't sold to Germany so (presumably) the trade marks fell to be revoked for non-use.

Both cases show the importance of using registered trade marks, and doing so in the right way. As the range of stuff that people register has grown in the last few years, so the number of trade marks on the registers of Europe which aren't really being used has grown too. There are, no doubt, a lot of useless trade marks out there.

Golden Balls dispute ends as couple win legal victory over Ballon D'Or oganisers: my letter to the editor of the Telegraph

Sir,
Your story is such a sloppy and inaccurate piece of reporting as to detract from a very important matter for very many small businesses. The European Patent Office, as the name suggests, is responsible for patents, not trade marks, and it has no jurisdiction over infringements. Your story is actually about opposition proceedings in the European Community's trade mark office (an institution that cunningly hides behind the name Office for Harmonisation in the Internal Market - surely a gift for a mischievous journalist).

That large trade mark owners with deep pockets can hinder the registration by small businesses of trade marks almost at will is, in my view, a scandal. It removes trade mark law from teh area of unfair competition (where it legitimately, though not exclusively, belongs, and where people would expect to find it) and aligns it, almost, with copyright. I recently represented a client in such a case, where the opponent submitted 1200 pages of documentary evidence (accompanied by two CDROMs). I make no comment on the merits of the case you  report, but the system is open to abuse and permits corporate bullying of the worst kind. Trade marks are a form of commercial speech, and freedom of speech is threatened, as Lord Justice Jacob said recently in a  different trade-mark context in the Court of Appeal.

A few years ago the UK moved from a system in which the Registry rejected applications that conflicted with someone else's existing trade mark to one based, like the European Community one, on oppositions. It raised the costs of trade mark ownership, as small businesses can no longer rely on the registry to police new  applications: they have to do this themselves, maybe paying for a monitoring service and paying out to oppose applications which previously would have been thrown out immediately, and at no cost to them. Just last week the Irish Government took the wise decision not to repeat the UK's mistake, and to retain its present system (very like the old UK approach). Legal aid is not the answer, but reform of trade mark law - including reform of the European Community law - is absolutely essential for small businesses trying to make their mark.

Ireland to continue applying relative grounds

http://www.deti.ie/science/ipr/tmcons_relativegrounds_outcome.htmThis comes from the excellent Class 46 blog: the Irish government has carried out a consultation and concluded that it should retain the present system under which trade mark applications are examined for relative grounds, and refused if there are any. Ah, the nostalgia ... The Department of Enterprise, Trade and Innovation says:

While a move to a ‘search and notify’ system would position the Patents Office alongside OHIM it would mean that, in the face of no response from prior rights holders (for whatever reason), the Office would end up registering marks that fail to perform the fundamental function required in Section 6(1) of the Act. There would not be any guarantee of origin and the integrity of the Register would be compromised.

Exactly. Which is just what is wrong with OHIM and the UK register, since we stopped refusing registrations that should not have been allowed through. The 'search and notify' approach is not only expensive for trade mark owners, it leaves too much scope for monopolisation of signs and for both those reasons is an obstacle to growth (except among trade mark practitioners).

Abuse of dominant position: AstraZeneca

In Case T-321/05 AstraZeneca v Commission the General Court upheld the Commission's finding that the drug company had abused its dominant position (contrary to Article 82 as it was, Article 86 as I remember it, now Article 102 TFEU - and also Article 54 of the EEA Agreement), but reduced from 60 million to 52.5 million Euros the penalty imposed for it. The Commission found that it had done so to keep a generic competitor for Omeprazole, which it  sold under the names  Prilosec and Losec heartburn medicine, off the market.

AstraZeneca challenged the European Commission's decision to fine it for abuse of its dominant position including misleading patent offices in several countries (including the UK) and a number of courts.This finding stands, but the Court reversed the Commission's finding that AstraZeneca breached competition rules by withdrawing market approvals for older versions of the medicine in Denmark and Norway, preventing generic producers and parallel importers entering the market.

Yorkshire Forced Rhubarb PDO

Another hat-tip to Mike Tobin: Yorkshire Forced Rhubarb has acheieved PDO status (although it must be said that this is slightly old news). Here's a link to the entry in the DOOR database and here's a link to the BBC News story.

June IP update

The lawcast, and the notes, are now up on the Lawcasts page of this blog. Click on any of the links I have scattered around the place ...

This month's programme features the Bilski case, the Advocate General's opinion in Flos (an Italian case on the interface between copyright and designs law), the Edwards case on priorities in patent applications and a "reverse-Edwards" dilemma, and a malicious falsehood case in the Court of Appeal - a very rare thing. Plus all the usual stuff about the latest law from the Court of Justice (which has received an astonishing number of referrals this month), the General Court, the English courts, the EPO, the IPO, OHIIM, you name it.

Dazed and Confused? Certainly!

Hat tip to Mike Tobin for this: According to Music Week, American folk singer Jake Holmes (it seems one can be excused for not having heard of him) is suing a rather better-known act called Led Zeppelin for copyright infringement. He claims that Jimmy Page took his (Holmes's) song, Dazed and Confused. The allegation has been around for long enough, but only now - and with no prospect of recovering more than three years back-royalties - is he taking action ... Even so, that might be worth a few bob, and going forward there should be a few more in it for him too.

[Whiter] Shades of ...

Postscript:  Mike Tatroe (who must be another Facebook Rhubarb Thrasher) added that one of the commenters on the NY Times version of this article (http://nyti.ms/9Q5vAr) claims to have known Jake Holmes and previously asked him why he'd never sued Page. At the time, Holmes "...said that Page had so reconstructed the song that he'd made it into something altogether different so he never bothered." You be the judge ...