Second-hand software

There's a lot of it around, but is it legal? Can the licence be transferred to a buyer? That was the issue in  Vernor v. Autodesk, in which Mr Vernor offered unopened, authentic, copies of AutoCAD for sale on eBay. When challenged he applied to the District Court for the Western District of Washington for declaratory relief (that link takes you to a piece published by Foley Hoag) and he got summary judgment. On appeal from the District Court, the Court of Appeals for the Ninth Circuit held that Autodesk's customers were licensees and not owners so the sale of the AutoCAD software to Vernor, which was prohibited by the AutoCAD license, was invalid. Mr Vernor was neither a licensee nor an owner and the first sale doctrine was of no assistance to him.

On 3 October the US Supreme Court declined a request to grant certiorari. This means that the Ninth Circuit's three-prong test for determining whether a software user is a licensee or an owner is the law, at least in the Ninth Circuit. This raises the intriguing and very US question whether other circuits will follow the Ninth, and if differences emerge the Supreme Court might well have to take the matter on. Meanwhile, the original claim is back with the District Court, and at the same time an expedition to Luxembourg is under way (from the Bundesgerichthof) in Case C-128/11 Oracle International Corporation v usedSoft GmbH, which might of course produce a completely different answer ... Given that the terms of the licence are crucial in these cases, that might be quite possible and perfectly correct. In any event, it's an interesting area.

Canadian copyright law and digital locks

Here's an interesting posting by Michael Geist about the proposed Canadian copyright law changes, which would deal with (among other things) breaking digital locks. Canada would fall into line with the USA and its Digital Millennium Copyright Act, a piece of legislation which Draco would probably find quite to his taste (although he'd surely find the omission of the death penalty inexplicable), and as one would expect the chattering classes have a lot to say about this piece of cultural imperialism and the Conservative government's craven submission to Big Copyright - here, for example.

A particularly obscure branch of metaphyiscs

Not my phrase: that's what Jacob LJ called design law, in Dyson v Qualtex five years ago. Earlier this week, I spent a day presenting a course on IP infringements and enforcement - someone else's course, so I was using materials I hadn't prepared, though I don't think I'd have covered the subject any differently. I found myself having to explain to the audience that designs featured less in real, practising, life than any other area of intellectual property law, but that the law was so complicated - such a mess - that it demanded a large chunk of such a course.

I've been explaining the same thing to my Russian students, and my American student, all studying for external London University LLB degrees, the American one having done her resit yesterday. The examiner demonstrates what might be thought to be an unhealthy interest in designs - worse than that, in fact, because the Community system isn't part of the syllabus and copyright seems to loom large, which makes it all seem highly artificial. But it's certainly an area of law in which, right now, there's quite a lot going on, with the Court of Justice handing down its judgment in the Pogs case last week and now the Court of Appeal deciding Dyson Ltd v Vax Ltd [2011] EWCA Civ 1206 (27 October 2011).

The story so far is that last year Mr Justice Arnold held that Vax's Mach Zen vacuum cleaner did not infringe Dyson's UK registered design, much to some people's surprise and Sir James Dyson's dismay. Dyson appealed.

To succeed in such an appeal, the appellant would have to show that the judge had gone wrong in principle. That's a big ask, and I don't think Mr Justice Arnold is the sort of chap to do that very often. The case was based on Article 9(2) of the Community design directive, which refers to the degree of freedom of the designer in developing his design, and that (as Jacob LJ observed) plainly refers to the registered design, not the accused object. Dyson complained that the judge had referred several times to the freedom of Vax's designer. Jacob LJ thought that it mattered not, there being no change in the degrees of design freedom between the date of the design and that of the design of the Vax machine.

Dyson's counsel (Henry Carr QC) also stated his case as being that the judge had effectively decided (as paraphrased in the Court of Appeal by Lady Justice Black) that the better the design the more people would say that it is only going to be worse if I do it a different way, so the less the design freedom, and ingenious and innovative designs would be penalised. Jacob LJ did not read the judgment this way. Indeed, the judge specifically held that the registered design was "strikingly different" from the existing "design corpus": Dyson argued that he had however failed to apply the principle that where this is the case the new designi s likely to have a greater overall visual impact than if it is "surrounded by kindred prior art", as HHJ Fysh pithily put it in Woodhouse. The Court of Appeal rejected this approach, holding that the judge was still entitled to find that the Vax machine did produce on the informed user a different overall impression from that produced by the Dyson design.

Sir James Dyson is clearly unhappy, according to this report, though I don't think he has taken full account of the rile of the Court of Appeal. I am disappointed that he should have launched such a diatribe, although I can understand that he feels miffed. He ought however to be directing his ire against a design law which seems more hopeless the  more I think about it.

Men at Work case won't go to appeal

That interesting Australian copyright case involving the song Down Under by Men at Work, which was held to infringe copyright in the well-known, or "iconic" as it was called in the litigation, Kookaburra, has come to a halt with the High Court rejecting EMI's application to appeal. Mallesons have the story on the IP Whiteboard blog, which is always full of good stuff.

I'm not only old enough to recall the song, I am old enough to consider it new, in the sense that it is post-New Wave. And I couldn't remember anything in it that sounded like Kookaburra. Seems I was right, because the court needed expert assistance to find the bits that had been copied: there was no "ready aural perception" of the copied bars but they were there. But that does seem difficult to square with the notion of a musical work, which is intended to be enjoyed by being listened to (a literary work, by contrast, being enjoyed by being read). If you can't hear the similarity, is music copyright really engaged?

Any electronics patent attorneys out there?

My good friend Pete Fellows, whose recruitment firm sponsors my IP podcasts and blawgs, tells me that he is looking for patent attorneys (including part-qualified ones) with a background in electronics, physics or computer science. It seems they are in short supply, and he's even offering a Samsung Galaxy fondleslab (original version) if they place a candidate you introduce to them. See here for more information.

Thomas More and the European Union?

Reading - as I should have done many years ago, having bought it in August 1980 - Paul Johnson's absorbing history of Britain, The Offshore Islanders (Penguin, 1972), this sentence strikes me:

But equally he [More] can be seen as upholding an ancient and ramshackle structure, whose reality had never corresponded to its ideals, and which was now breaking up under the stress of nationalism ...

The next three words are, of course, "the Catholic Church", but it does sound remarkably like the European Union, of which  the Catholic Church (and before it the Roman Empire) was a precursor in the limited sense that it created a union of a sort among the nations of Europe. I particularly like the "reality never corresponding to ideals" bit, which to me seems especially apposite as a description of trade mark law in the European Union. To that perhaps one should add designs, and prospectively patents too.

An Australian Feist

Copyright in compilations remains a thorny issue, and if I needed reminding of it the other week explaining it to Russian law students certainly worked. Databases that aren't compilations, and vice versa - we are into the realm of metaphysics here.

Feist, SCOTUS's last word (as far as I know) on the subject of copyright in compilations (in suit, an alphabetical telephone directory for part of rural Kansas where I imagine telephones are few and far between, people likewise), was the death-knell for the "sweat of the brow" test, one of those graphic expressions that American lawyers use to the delight of legal dictionary-writers. In Telstra Corporation Limited & Anor v Phone Directories Company Pty Ltd & Ors [2011] HCATrans 248 (2 September 2011) the High Court of Australia has taken what seems to be a similar step, and given the close connection between Australian and English law this might be more important for us than Feist was.

The case raises interesting points about the need to identify the author or authors, and about the effect of using a computer. It has always struck me that making an alphabetical list using a computer is extremely unlikely to result in any sweat on one's brow. Read the interesting review of the points on Mallesons' IP Whiteboard blawg.

Troll trounced: Righthaven loses out

It built its business on acquiring copyrights from newspapers and going after bloggers and others who used photos and the like on the web, but the model appears to have been flawed, reports Washington College of Law's Intellectual Property Brief. Righthaven sued one Leland Wolf for using a photo from the Denver Post, but the defendant successfully challenged the Colorado Dostrict Court's jurisdiction, which being based on copyright infringement was inextricably bound up with the merits of the claim. The judge held that the copyright assignment agreement had not transferred any real ownership interest to Righthaven, who could not therefore sue as owners.  He dismissed the case and awarded Mr Wolf costs.

So what went wrong? I think that will have to await sight of the judgment, which doesn't appear to be on the web just yet, but the Brief on the Motion to Dismiss (which I am pleased to see was co-drafted by my friend Marc Randazza) gives us a good clue: the assignment, such as it was, gave Righthaven no rights to use the copyright works, just to sue for infringement. The rights were assigned "solely to coat its lawsuits with the veneer of legitimacy" - nice turn of phrase there. Here is the Strategic Alliance Agreement (see clause 7 in particular).

The excellent Electronic Frontier Foundation filed an amicus brief in the case and have more information about it here.

Wolf is one of over 50 cases brought by Righthaven in the Colorado court, so from their point of view a lot hangs on it.

Database protection in Argentina

There are criminal sanctions attached. I get worked up about the offences that have been bolted onto our IP laws, but they don't come close to this. Perhaps some businesses would like them to.

According to a newsletter from Marval O'Farrell & Mairal, a recent case was brought by a corporate event planning company against two former employees who had made off with the database and set up in competition. This database, among other things, contained the distilled wisdom and experience of the organisation on how to organise such events. The Court of First Instance indicted both defendants on charges of intellectual property fraud, pursuant to Section 71 of Intellectual Property Law No.11,723 (which covers databases by virtue of Law No. 25,036). They appealed, arguing that they were only re-using ideas not expression, but the Court of Appeals upheld the trial court. This database, far from being a mere compilation of information, was the result of careful data selection and classification, designed to support a specific working methodology, tailored to the specific needs of a particular company.

Intellectual property fraud. A concept to conjure with.

Register a Community design within 48 hours

You can, according to President Campinos of OHIM (reported here by MIP). You have to pay the application fee using a current account with the office because other payment methods such as credit cards and bank transfers cause delays (the banks taking the opportunity to put the money into Greek bonds or something overnight, I suppose) and submit a high-quality application, which means email not a smudged fax. Ideally you won't claim priority, but if you do you must submit all the priority documents at the outset. These details appear to have been added by MIP as they don't appear in the published version of the President's speech - he might have been ad-libbing.

Of course, the speed of processing is down to the fact that there is no substantive examination, perhaps no human intervention at all, which makes me wonder why it can't be done within 48 seconds. The Community registered design system is a deposit system in all but name, so what you get at the end of the process, however quick it might be, has to be heavily discounted because of the lack of scrutiny. Registered designs are, of course, virtually impossible to assess for novelty, because the prior art is not organised in a searchable form.

Personally, I'd rather the process took longer and resulted in the grant of a reliable registration. A quick process for obtaining a right that stands a good chance of being worthless is the ultimate triumph of form over substance, making the Community registered design an end in itself. It also makes the application fee little more than a tax on businesses to fund a pointless institution. Excellent nonsense.

The web should have been patented

So said WIPO DG Francis Gurry. He might be thought not to be the most impartial commentator on the desirability of patents ... For some reason his comments have only now achieved wide circulation, thanks largely to Cory Doctorow who posted a commentary here. The video is on YouTube (naturally).



My mind is boggling - though I can see something in rationing the web, which would be one effect of giving the underlying ideas patent protection. It would be much more manageable, wouldn't it, if there were less stuff on it? You'd be able to find what you wanted more efficiently. Unless what you wanted was what happened to have been rationed out of existence: like this blog, I reckon. Maybe the world would be a better place for that. It would give governments a much better chance of controlling what's on it, too: all that tedious free speech stuff would go. Mr Gurry seems to base his argument on the investment that would come in, which (a) ignores the amount of investment that there is in the technology without basic patent protection and (b) would probably put control in the hands of the Disney Corporation, News International and a vast array of pornographers. Much better.

Doctorow says that this could only possibly come from "a blind adherence to the ideology that holds that patents are always good, no matter what", and it's hard to disagree. Gurry says that IP is a very flexible system - a sweeping generalisation, I'd say, when he's trying to commend patent protection - and draws a comparison with the invention of the saxophone, which he said is the only instrument in the classical orchestra which has ever been patented. Well, I don't know whether there is a precise definition of a classical orchestra, but I doubt it would include a saxophone, which is a rare addition to what most people would understand as a classical orchestra: and as we are now discussing exotic additions to the classical orchestra, the ondes martenot was (were?) patented in 1928, and indeed there seem to be quite a few patents surrounding that instrument.

Gurry argues that patent protection for the saxophone meant that others (in addition to Adolphe Sax, who must be in the top seven of famous Belgians: Ickx, Merckx, Magritte, Rubens, Hergé, ... Plastic Bertrand - does Rubens count, if Belgium did not exist as such in his lifetime? And is it really appropriate to include Audrey Hepburn just because she was born in Brussels of an English father and a Dutch mother?) were able to make improvements to the instrument, unlike the violin the secrets of which died with a handful of individuals in Cremona centuries ago. I don't think there's much danger of the secrets of how the web works suffering the same fate. What the intellectual property system needs is less of this hyper-inflation.

Trade marks and public policy

The General Court has also decided that, as a trade mark, PAKI is contrary to public policy or to accepted principles of morality: T-526/09, PAKI Logistics GmbH v OHIM. The court remarked that the word was a racist expression and therefore unacceptable as a trade mark. This notwithstanding that the applicant is a reputable German logistics company and the mark is used in the form PAKi. (I can see the connection between the PAK element and logistics - and they have been around since 1974.) Pakistan, incidentally, is called Pakistan in German.

For those unfamiliar with English racist slang, the expression was commonly used, is used less often now, with a considerable measure of ignorance as well as malice to denote just about anyone from the Indian sub-continent. I don't believe it was, or is, used exclusively with malice, and it can sometimes be intended neutrally - we have an "Indo-Pak" restaurant not far away from home, although there is a big difference between using the term for a whole people and using it for an individual. Often people use expressions like this with the best of intentions, unaware of the hurt they cause.

The court also noted that protection against discrimination is a fundamental value of the EU, provided for in Articles 2 and 3, paragraph 3 of EU Treaty and Articles 9 and 10 of the Treaty on the Functioning of the European Union, and Art.21 of the Charter of Fundamental Rights of the European Union.

Well, the measure of what should be acceptable is easy enough: if people don't like it, we should all respect their wishes, not use the word, and not allow it to be registered as a trade mark. The court was presented with evidence that the word is used in the Pakistani community, and is not necessarily offensive to them: but even if the law is protecting the sensibilities of the chattering classes, perhaps that's reason enough to refuse registration. But it does seem an unfortunate side-effect of the Community trade mark system that a German company should find its name unprotectable at EU level.

Because it involves the same provision of the regulation, and because I have only recently caught up with it, and because of my visit to Russia last weekend, I'll also add a reference to Case R 1509/2008-2 Couture Tech, a decision of the OHIM Second Board of Appeal in an appeal against a decision to refuse registration of the old Soviet Union symbol of hammer, sickle, globe, red star, and "workers of all countries, unite!" in 15 languages (none of them English, rather like a General Court judgment). The board noted that the Soviet Union - which the board seems to treat as interchangeable with the Soviet Communist Party, perhaps rightly - was

... a totalitarian state that massively violated human rights, under the leadership of the Soviet Communist party, committed crimes against humanity, including summary executions, torture, sending innocent people to labour camps, involuntary settlement and stripping of citizen’s rights. It is commonly  accepted that the ethnicity-targeted population transfers in the Soviet Union led to million deaths due to inflicted hardships. For example, 10 percent of the entire adult Baltic population was deported or sent to labour camps, as can bee seen from Wikipedia printouts.

Allow me in passing to exclaim - "Wikipedia???". But the historical facts are beyond dispute, even if there might be arguments about the details, and the Board's conclusion that the trade mark the subject of the application would cause offence in countries which suffered under the Soviet regime, some of which ban such signs as some countries do Nazi insignia.

Good call: but what baffles me is why anyone would think this a suitable sign to use as a trade mark in the first place?

B&O loudspeaker shape cannot be registered as trade mark

The directive and the regulation both say you cannot register as a trade mark a shape that gives substantial value to the goods to which it is applied. In Case T-508/08 Bang & Olufsen v OHIM the General Court applied this rule to uphold the Office's refusal to register the shape of its speakers.

And quite right too. That provision has always caused me a little worry, as the whole point of applying a trade mark - any sort of trade mark - to goods is to enhance their value. A plain unmarked bottle of brown fizzy liquid is worth little: make the bottle curvaceous and apply a Coca-Cola (or Pepsi) label and it's a different story. But just because the law might be difficult to apply in extreme cases doesn't mean it is wrong.

The B&O case has a long history. Their application, filed in 2003, was refused as being devoid of any [sic] distinctive character. (This "devoid of any" formation grieves me - surely the "any" is redundant, as "devoid" means having none at all, without the need to reinforce it.) The Court then upheld their appeal, sending the case back to Alicante, where it was refused again but this time on the grounds that the shape gave substantial value to the goods. You have to acknowledge the applicants' persistence, because they set off on another expedition to Luxembourg to get that straightened out too.

Except that the court did not oblige:

The Court finds that in the present case the shape for which registration was sought has a very specific design. In the Court’s view, that design is an essential element of Bang & Olufsen’s branding and increases the value of the product concerned. Furthermore, it is apparent from extracts from distributors’ websites and online auction or second-hand websites that the aesthetic characteristics of that shape are emphasised first and that the shape is perceived as a kind of pure, slender, timeless sculpture for music reproduction, which makes it an important selling point. Accordingly, the Court holds that OHIM did not make any error in finding that, independently of the other characteristics of the product at issue, the shape for which registration was sought gives substantial value to that product.

The court also noted that it was perfectly OK for the Office to work through the absolute grounds for refusal one after the other, as they are independent. The result: no trade mark protection for the shape. I know it looks pretty distinctive, and B&O thrive on the appearance of their products, but the interface between design protection and trade mark protection is one that has to be guarded carefully. These same loudspeakers - the designs for them - can be protected for 25 years as designs, and if that is considered to be the right period of protection then whose interest would be served by permitting them to be protected by the trade mark system too, potentially for ever?

High Court remits software patent matter to Comptroller

Re Halliburton Energy Services Inc [2011] EWHC 2508 (Pat) is an appeal from the Comptroller. HHJ Birss, sitting as a High Court judge, allowed the appeal and remitted the case back for the Patent Office to try again. The Deputy Director, Mr Thorpe, acting for the Comptroller had rejected four applications, on the grounds that they were within the "mental acts" exclusion or were computer programs. The claims were to methods of simulating drill bit performance, without going on to deal with manufacturing the things once they had been simulated.

The law in this area was laid down by the Court of Appeal in Aerotel v Telco / Macrossan's Application [2006] EWCA Civ 1371 (in which Jacob LJ gave the judgment of the court) and Symbian v Comptroller [2008] EWCA Civ 1066 (in which he didn't, though the judgment of the Court which Lord Neuberger gave presumably contained a lot of Jacob). But there remains a great deal of dispute about the rules, with differences between UK Office practice and the EPO, complicated by the change of law in EPC 2000 (implemented in the Patents Act 2004, which came into operation after Aerotel: and there are other cases, including Kapur [2008] EWHC 649 (Pat) before Floyd J, which touch on the subject (and Kapur, which is more relevant than Symbian to the facts of the present case, was not brought to Mr Thorpe's attention.

In the present case, regarding the mental act exclusion, the judge decided that:

... the correct scope of the mental act exclusion is a narrow one. Its purpose is to make sure that patent claims cannot be performed by purely mental means and that is all. The exclusion will not apply if there are appropriate non-mental limitations in the claim.

He also decided that, applying the Aerotel  judgment, the invention was not excluded as a computer program. So the case was decided without having to go into some of the more exotic questions before it: but the judge had a quick go at them anyway. He did not agree that the 2004 Act permitted him to depart from the Court of Appeal judgments. He thought that, correctly applied, the different approaches in the UK and the EPO should not lead to different results (so the outcome would be right, just the route to it would differ, a matter mentioned by Pumphrey J in Cappellini and Bloomberg [2007] EWHC 476 (Pat). And he rejected the "familiar and illegitimate" argument (which he merely "detected" in counsel's submissions) that the EPO approach to patentability should be taken but in combination with the UK's approach to inventive step, which he said would lead to very different results in the two offices.

An interesting case, from which the judge concludes that

... as a matter of law computer implemented inventions are just as patentable in the UK as in the EPO.

Really? That sounds as if it might spoil the fun! 

WIPO 'British Day' for Patents

WIPO is holding a day of discussions for UK patent practitioners on 13 October - next Thursday. At least it will if enough people sign up for it. The IPKat publicised it this morning, and I'm doing my bit too - having signed up to it myself. Details from http://www.ipo.gov.uk/whyuse/events/events-calendar/events-britishday.htm.

Free movement of televised football

I can think of few things short of violence and some types of music more likely to keep me out of a pub than a widescreen TV showing a football match. In fact any widescreen TV showing a sporting event that seems to involve abnormally short, fat men. Why is the image always distorted?

The Court of Justice has decided, agreeing with the Advocate General, that Karen Murphy is within her rights to show Premier League matches using a decoder obtained from Greece: the story is on the BBC News website and here is the judgment in Joined Cases C-403/08, C429/08 Football Association Premier League and Others, Murphy. The Court says that national legislation which prohibits the use of overseas decoders could not "be justified either in light of the objective of protecting intellectual property rights or by the objective of encouraging the public to attend football stadiums". So what is going to happen now? Sky can't carve up the European market and charge much more in the UK than in Greece, which frankly makes very little sense to me: the market for broadcasts of English football matches, even allowing for the fact that the Premier League is the most popular in the world and commands attention far, far from England, is not a single one within the EEA, and the broadcasts command a lower price in some countries than in others. (I wonder how much they cost in Scotland?) It is another instance of the Court, and European Union law, imposing on the EEA a rule that only makes sense if the EEA is something that it is not and probably never will be. The same lack of logic applies to old parallel import cases: I am reminded of the Silhouette case, with the suggestion that designer sunglasses should be sold at the same price in pre-accession Bulgaria and in affluent Austria. How many Bulgarians were going to buy at Austrian prices? And what are the chances of prices being reduced to Bulgarian levels in other countries?
Profit maximisation demands that different prices be charged in different markets, and pretending that there are no different markets makes a nonsense of that. I don't imagine that Sky is going to be reducing its prices to English pubs (doesn't seem the Murdoch way), so the effect of this undoubtedly soundly Communitaire judgment will be to deprive Greeks of Premier League football.
Actually, now I think of it ... I'm not sure they need much sympathy.