IPO launches consultation on exhaustion of IP rights post-Brexit

The UK government has launched a consultation on the future regime for the exhaustion of IP rights. The consultation is open for responses from 7 June to 31 August 2021. It is going to be a crucial decision which would significantly impact IP owners, consumers, and others involved and affected by parallel trade. 

IP rights give economic incentives for creations, products and innovations of new technology, enabling rights owners to benefit from the information and intellectual goods created. Consumers benefit from the availability of a wider range of innovative or attractive goods. But move away from this justification and you have a plain old monopoly, which means fewer goods being made, innovation being sidelined, and prices being raised.

The doctrine of exhaustion of IP rights exists to balance the different interests of consumers and rights owners when goods move between jurisdictions, preserving competition in situations where the traditional justification for IP protection is not convincing. The doctrine limits the ability of IP rights holders to use their rights to control the distribution of physical goods once they have legitimately been put on the market. Intellectual property rights can be invoked to prevent goods crossing territorial borders, an issue that has caused problems within western Europe since the earliest days of the European Economic Community. “Parallel trade” - goods moving between national markets outside the manufacturer’s official channels, are a challenge to rights-owners’ marketing strategies, but often a key factor in reducing prices.

Price differentials, naturally, lie at the heart of parallel trading. Traders - arbitrageurs, they might prefer to be called - will buy goods where they are cheap and move them to markets where they command a higher price. At one level, this is nothing that has not been going on for centuries: Traders will buy produce where it is grown and move it to where people want to buy it. But in the consumer society it’s far more complicated. Purchasing power differs enormously, even within the European Economic Area, and a rational manufacturer will pitch their prices according to what local consumers can afford - which might represent a fantastic bargain to someone in a richer EU country.

Following Brexit, the UK is no longer bound by the requirements of EU’s rules, which in essence say that once goods have been placed on the market within the European Economic Area any IP rights attached to them will not be infringed if those goods are imported into another Member State (although the rules do provide for cases where there are legitimate reasons for stopping parallel imports, for example where they have been repackaged). The goods have to be free to circulate within the EEA. Notwithstanding all the talk of taking back control, the UK (at least in part because the Northern Ireland Protocol limits its room for manoeuvre) continues to apply the same rules after Brexit, so we are open to trade in cheap pharmaceuticals from The Netherlands; but the EU simply treats the UK as a third country, not within the Single Market, so parallel imports entering EU Member States from here are likely to infringe.

The consultation identifies four possible regimes: 

● The current unilateral EEA regime 

● National exhaustion 

● International exhaustion 

● A mixed regime 

The current unilateral EEA regime 

Once goods are put legitimately on the market in the EEA, rights are considered to be exhausted in the UK. IP rights cannot be used to prevent goods being imported from the EEA into the UK. On the other hand, the EEA is closed to parallel imports from the UK, but that is a matter for EU law so naturally the consultation does not touch on this aspect.

National Exhaustion 

Under this regime, rights are only considered exhausted in the UK once goods are legitimately put on the market in the UK, so IP rights can be used to prevent goods put on the market anywhere in the world from flowing into the UK. But this option has been ruled out by the government because of the inconsistency with the Northern Ireland Protocol, which means no checks are needed on the goods crossing the border with the Republic of Ireland. 

This option was only included in the consultation to gather what evidence is available on economic impact.

International exhaustion 

This regime would automatically allow the import of goods from any country. exports, on the other hand, would be automatically allowed only to those other countries with an international regime. This means that the rights are considered exhausted in the UK when goods are legitimately put on the market anywhere in the world. IP rights then cannot be used to prevent goods from entering the UK from any other country. This would have significant implications for IP owners in that it would limit their ability to prevent goods from being parallel imported into the UK. 

We have been here before, though it was over 20 years ago. Following the Silhouette case, the Commission had a report drawn up entitled "The economic consequences of the choice of regime of exhaustion in the area of trademarks" (NERA/SJ Berwin, February 1999), which found that the issues were complex and the benefit to consumers of changing to international exhaustion likely to be small (in some sectors under 2 per cent). It then consulted widely, including with Member States: in the UK, the result of this was the Eighth Report of the Select Committee on Trade and Industry (9 July 1999). The Commission dropped the idea of changing, though the Select Committee favoured international exhaustion at least for some goods. Which leads us to...

A mixed regime 

This would mean that specific goods and sectors could be subject to one regime and all other goods, sectors and IP rights subject to a different regime. Switzerland has a regime in which most goods can be parallel imported but an exception for medicines which is governed under their national regime. It is going to be a rather complex system if implemented and may be difficult for consumers and businesses to understand, but that doesn’t seem to have given the government pause for thought since the referendum. 

Note that the consultation does not cover some major topics such as: 

● Exhaustion of rights in purely digital goods. 

● Geographical indications or plant variety rights 

● Counterfeit goods 

● Parallel exports

Conclusion

Since the “National Exhaustion regime” has been ruled out, the UK government is left with limited possibilities . It will be interesting to see which regime will win the votes for this Post-Brexit battle as this will be of great commercial concern. Will the Government  head towards a “Mixed regime” and implement a complex system for consumers and businesses or getting cheap exports through “International regime” become the vote-winner? Only time will tell.

Florence Foster Jenkins and joint authorship

"Movie makers do lunch, not contracts", said now-retired* Judge Alex Kozinski in Effects Assoc., Inc. v Cohen, 908 F.2d 555, 556 (9th Cir. 1990), cert.denied, 498 U.S. 1103 (1991). The writers of screenplays are also disinclined to write contracts, it seems - although in the recent-decided case, Martin & Anor v Kogan [2021] EWHC 24 (Ch) (11 January 2021), it was perhaps excusable given that the two collaborators were also romantically involved. Mr Martin was (and is) a professional scriptwriter, and Ms Kogan an opera singer. 

Before they met, Mr Martin did not know of Florence Foster Jenkins, but she became the subject of the first of his feature film scripts to be produced, and the film was a great success. But was it really his script?

Mr Martin and a number of companies involved in the production sued for a declaration that he was the author of the screenplay and the sole owner of the copyright; Ms Kogan sought a declaration that she was a joint author and therefore joint owner of the copyright, and she also claimed damages for infringement against the various production companies. The case came before HHJ Hacon in the Intellectual Property Enterprise Court in 2017, and he found for Mr Martin. Ms Kogan (represented by, among others, Lionel Bently) appealed, and the Court of Appeal (which included Floyd LJ, a distinguished intellectual property barrister before he became a judge, who delivered the judgment of the court) decided that the first instance judgment was wrong. Unusually, because the Court of Appeal must avoid involving itself in detailed and complex re-asessments of factual findings by a judge, it sent the case back for a new trial before a different judge - specifying a full-time circuit of High Court judge. It ended up in the Chancery Division before Meade J, who became a High Court judge on 7 September last year.

The Court of Appeal found that the judge had made a number of errors. He had tried to draw a distinction between primary and secondary skills in assessing the parties' respective contributions, a distinction that the Court of Appeal found had no basis in law. He had also failed to consider the screenplay as a dramatic work, with many differences from a literary work.

The case raises a number of important and interesting questions, of which the most significant (for a copyright lawyer) is what sort of contribution to a collaborative work is going to make the second collaborator a joint author. The secondary question of how to work out what proportion of the copyright should belong to each joint owner is also pretty significant. There is also a lot more to the case - the judgment runs to 72 pages, although it is fact-heavy so it needs a lot of exposition.

Although the largest part of the screenplay had been written by Mr Martin, the original idea had been Ms Kogan's and she had also been involved in the characterisation and had contributed some technical terms. She had been involved in the work through several drafts and the judge was satisfied that she had made an authorial contribution to the work that was not distinct from Mr Martin's; in the judge's words: 'Trying to separate them would be like trying to unmix purple paint into red and blue' - like Kamela Harris's carefully-chosen bi-partisan inaguration outfit.

The judge decided that Ms Kogan was entitled to a 20 per cent share of the copyright. The starting assumption with joint copyright is that the parties will have equal shares, but clearly the parties' respective contributions here demanded something else. The judgment confirms that the parties hold their shares as tenants in common, not as joint tenants.

*Under a cloud, it's fair to say, but I think it's still acceptable to quote him especially since he's a master of one-liners.

Love, passion and ... IP: When a copyright work goes too far

It seems a long, long time since I wrote an article for publication. Books, blogging and courses seemed to take all the available time. So I am delighted to be able to say that the Journal of Intellectual Property Law and Practice will soon be publishing a rather insubstantial piece I wrote about that famous copyright case, Glyn v Weston Feature Film Company, in response to the editor's request for pieces on the theme of "Love, passion and ... IP". Well, it had to be done, and I hope people find it entertaining. It is also quite illuminating, as the judgment isn't actually what the textbooks mostly say it is (my own textbook included, though not any longer) and as the novel was the biggest-selling book of 1907, and made its author a star, it really ought not to be confined to the footnotes.

Read the advance summary of my article here.

No summary judgment in software copyright case

Douglas Campbell QC, sitting as a Chancery Division judge, refused to give the claimant summary judgment in Oysterware Ltd & Intentor Ltd [2020] EWHC 2125 (Ch) (not yet on Bailii: I am indebted to the report from Practical Law) although it might have been another story had the claim been formulated differently.

The claimant supplied hardware, software, and support to the defendant. When the relationship came to an end, they sued for breach of contract, breach of confidence, and infringement of copyright, alleging that the first defendant had copied the design of what was referred "the Embedded Product." 

The Embedded Product was described as a single homogenous runtime image (a runtime image being, as I understand it, executable Java code that does not need an accompanying Java Runtime Environment distributed with it, which makes it much smaller and more easily distributed). It consisted of computer code that emanated variously from Microsoft, third party suppliers and the claimant, but the defendants characterised it as a general-purpose computer running Windows XP. Of course the claimant owned no copyright in the operating system or in the third party software, but that is not really the point; no doubt recognising this fact, they had claimed that copyright in the design of the Embedded Product, rather than copyright in the embedded product itself, had been infringed.

So what was that design? A former employee of the claimant gave evidence that the embedded product had to be considered as a whole (hence the "single homogenous" rubric). This embraced the specific design of the runtime image and the compilation of components. But the claim said that the runtime image was the copyright work; it said nothing about copyright in a compilation. (I find myself imagining the judge, indeed any judge, thinking about how he could have drafted the claim - I doubt they can resist doing so, although of course that in itself is not grounds for a decision.)

The employee explained that the design involved skilled choices, which sounds like a last-ditch effort to rescue a drowning copyright claim; crucially, that was a matter for the court. The pleadings had left subsistance as a matter that needed a trial, precluding summary judgment.

Whether what the defendants had copied was what conferred onginality on the Embedded Product was another matter that was that was not suitable for summary disposition. Because the claimant had failed to identify what the product's structure was and whether it involved intellectual creativity, they were not going to get summary judgment.

The same litigation has already given us a statement of the principles to be applied in an application to strike out: [2018] EWHC 611, which is also missing from Bailii.

Cheat software infringes copyright in Grand Theft Auto V

It won't surprise you to learn that computer games are not my thing. I did have to look at one some years ago for a client who objected to the content (we took the view in the end that the Streisand Effect was likely to make anything the client did about it counter-productive). So if I don't relate to computer games themselves, what am I supposed to think about software that enables the user to cheat in the game?

Cheat software is what was in issue in Take-Two Interactive Software Inc & Anor v James & Ors [2020] EWHC 179 (Pat) (29 January 2020) where in an application for summary judgment the judge (Mrs Justice Falk) held that it infringed copyright in the game itself. Not only that, there were breaches of contract both by the defendants and induced by them, the elements of the tort of inducing a breach of contract (knowledge, intention and damage, as laid down in OBG Ltd v Allan [2008] 1 AC 1) being made out against most of the defendants. There were a couple of points (the liability of a minor defendant, and circumvention of technical protection measures under s.296 CDPA to which the defendants seem to have had a plausible factual defence) which were not candidates for summary judgment, but on the other claims the judge saw no reason to leave liability for a trial.

Leaving aside the contract issues, this being an intellectual property blog, the important finding here is that by providing the cheat software the fourth and fifth defendants (the first three having settled earlier) had authorised copying of Grand Theft Auto V or substantial parts of it. The cheat software took information from the game so it could reproduce an image of something for use in the game. That there was copying is plain, and the defendants had provided the means to do the copying. Using the cheat software as intended would inevitably result in infringement.

The defendants tried arguing that the game software on the user's device remained unaltered, and any affect from the cheat software was not permanent: but transient copying is clearly within the s.16 definition of infringement, so that got them nowhere. However, the fact that the impact of the cheat software was on the program when running meant that attention had to be focussed on elements that frankly look a bit peripheral to my mind: images of weapons used in the game, and their software-driven functionality, residing in libraries and code within the program, were the example the judge referred to. Cheating meant conjuring up weapons that the user was not entitled to have, according to the rules of the game, so the copies were infringing ones. It strikes me as a pretty small infringement, and perhaps the fact of the matter is that the wrong here lies outside the scope of copyright (the breach of contract claims look much more substantial and convincing to me), but it does show how copyright can be brought to bear on a problem like this.

Would copyright remedies be worth pursuing? That remains to be decided, and the judge expressed the hope that hte parties will be able to sort that out without a trial. It's hard to see where the damage to the claimant is, and I suppose it's even arguable that the defendants might have made the game a bit more popular by opening up new possibilities and providing a route to a satisfactory outcome that users might not be able to achieve on their own. An account of profits might yield more. However, with copying of elements of the game inherent in the cheating (making more weapons available, etcetera) I can see grounds for the grant of an injunction, which would effectively put a stop to the cheating, even though it seems like a roundabout way to get there.

No copyright protection for design dictated by function - Advocate General

Having commuted into London by train for so much of my life, I have long been familiar with the Brompton folding bicycle - the advantages of which it's a little hard to appreciate when the crowded train carriage is full (OK, that's hyperbole) of them. What is the point of a machine for moving, when it is folded up and carried in a larger moving machine? When Brompton cycles became available for hire at my local railway station, but apparently with the intent that people would hire them to take to London rather than on arriving from London or elsewhere, I had one of those moments of clarity that comes to me when I realise I no longer understand how the world works (another instance of which is when I was reading Frank Zappa's obituary in the Financial Times).

A friend I made in the course of commuting - one of many, including a Chancery master and the future Information Commissioner - didn't clutter the train up with a Brompton cycle, although she might have done later, on a different line: but in 2010 and 2011 she was the female Brompton World Champion, which is quite an achievement. But I digress.

Be that as it may, they are a great product and a great success, although I'll stick to the mountain bike I bought from our neighbour a few years ago - a Brompton would not cope well with the track I use to get to the station. It's not surprising that such a successful design should have attracted the attention of copyists. While the folding mechanism was still protected by patents (the original one of which, EP0026800, was filed in 1979, so now long gone) these could be dealt with quite easily, but latterly Brompton (in which I include Mr SI) has had to rely on copyright and design law.

One such case is before the Tribunal de l’entreprise de Liège, which embarked on an expedition to Luxembourg with questions about whether a product with an industrial application whose shape is exclusively dictated by its function may attract copyright protection.  Advocate General Campos Sánchez-Bordona has today given an opinion in SI, Brompton Bicycle Ltd v Chedech/Get2Get (Case C-833/18) EU:C:2020:79: I'm baffled about the "SI" part of the case name, as the Opinion clearly describes the founder of Brompton, Andrew Ritchie, who owns much, perhaps all, of the intellectual property in the design, but in deference to the legal documents I will call him Mr SI until someone tells me to do otherwise.

There are two questions for the Court:

(1) Must EU law, in particular Directive 2001/29/EC of the European Parliament and of the Council of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, which determines, inter alia, the various exclusive rights conferred on copyright holders, in Articles 2 to 5 thereof, be interpreted as excluding from copyright protection works whose shape is necessary to achieve a technical result? 

(2) In order to assess whether a shape is necessary to achieve a technical result, must account be taken of the following criteria: 

– The existence of other possible shapes which allow the same technical result to be achieved? 

– The effectiveness of the shape in achieving that result? 

– The intention of the alleged infringer to achieve that result? 

– The existence of an earlier, now expired, patent on the process for achieving the technical result sought?

The AG observes that:

The referring court only asks the Court of Justice for an interpretation of Directive 2001/29.

I beg to differ - the words "in particular" say the very opposite. But maybe that Directive - which, let's not forget, is concerned with copyright in the information society, according to its title to which the Court seems to have less and less regard - is the only one that matters.

As for the shape being necessary to achieve a technical effect, the referring court had made a finding of fact about this: the shape was necessary in that sense. It would not be a matter for the Court of Justice anyway, but it had to be taken as read. The Advocate General advises the Court that it should not be protected by copyright.

It is not long since the Court gave its opinion in Cofemel (Case C‑683/17), EU:C:2019:363, and the Advocate General had nothing to add to the review of the case-law there. To be original, a work must reflect the personality of its creator. Cofemel tells us that aesthetic considerations play no part in determining whether a work is original. That indicates pretty clearly the direction in which the Opinion is going: if a design is dictated by function, it doesn't reflect the personality of the designer, and therefore cannot be original so copyright will never subsist in it. A digression to draw lessons from trade mark law (exclusion of shapes which achieve a technical function), which seems a bit left-field, reinforces the Advocate General's view.

There's more to the Opinion, but that will have to suffice for now.

Jacquard fabric as a work of artistic craftsmanship

The courts have always been much better at telling us what isn't a work of artistic craftsmanship than telling us what is. But in Response Clothing Ltd v The Edinburgh Woollen Mill Ltd [2020] EWHC 148 (IPEC) (29 January 2020) HHJ Hacon (the case seems to have been running for two or three years) in the Intellectual Property Enterprise Court has come up with an answer.

The fabric in question is a jacquard fabric, which is important because the distinctive thing about jacquard fabrics is that the pattern is woven into the fabric rather than simply being printed or embroidered. This opens up the possibility of the loom operator providing the essential craftsmanship contribution to the work.

The judge reviewed the cases, from Hensher v Restawile (1976) to Vermaat v Boncrest (2001), not to mention Lucasfilm (2008), concluding that the Hensher court (the House of Lords, remember) would have found against the present claimant: the fabric was not a work of artistic craftsmanship - the craftsmanship element being lacking. However, there was no clear guidance in Hensher (their Lordships canvassed about nine different ways of defining a work of artistic craftsmanship before concluding that they furniture in suit was none of them) and a New Zealand case, Bonz Group (Pty) Ltd v Cooke [1994] 3 N.Z.L.R. 216 (Tipping J) had been approved a couple of times by English courts (Vermaat and Lucasfilm) so it offered a better way forward: and importantly it provided a route to holding that the fabric was a work of artistic craftsmanship.

That, though, is no longer the end of the story.Directive 2001/29/EC of 22 May 2001 on the harmonisation of certain aspects of copyright and related rights in the information society, notwithstanding its title which seems to constrain its ambitions, is rapidly becoming the keystone of copyright law. Article 2 requires Member States to give authors the right to prevent reproduction of their "works", not just those works that the UK legislature has chosen to protect. Whether a "closed-list" copyright system is permissible under the directive remains a contentious point. It seems that it makes no difference in the present case: the claimed work was indeed a work, and it was its author's own intellectual creation. But that isn't always going to be the case, so we have to wonder whether now that the UK has taken back control of its copyright law we can look forward to some clarification of how these provisions wil work in future without the influence of the Court of Justice.

UK will not implement Digital Single Market Copyright Directive

In a written answer today to a question from Jo Stevens MP (Cardiff North), Rt Hon Chris Skidmore MP, Minister of State for Universities and Science, has told us what is hardly a surprise:

The deadline for implementing the EU Copyright Directive [that's 2019/790] is 7 June 2021. The United Kingdom will leave the European Union on 31 January 2020 and the Implementation Period will end on 31 December 2020. The Government has committed not to extend the Implementation Period. Therefore, the United Kingdom will not be required to implement the Directive, and the Government has no plans to do so. Any future changes to the UK copyright framework will be considered as part of the usual domestic policy process.

That's the domestic policy process that in 1988 put in place new legislation that had been needed since at least the Whitford Report ten years earlier. Meanwhile the carefully-considered changes to copyright law (whether you like them or not) that the Directive contains seem destined to pass us by. No "link tax", no change to the law on content-sharing, none of the other good things copyright owners were going to get from the Directive - Google and other platforms must be very happy.

Refusal to allow service out upheld

A Chancery Division judge has dismissed an appeal against a Master's refusal to give leave to serve Google outside the jurisdiction . The point arose in an action for copyright infringement, Wheat v Google LLC [2020] EWHC 27 (Ch) (15 January 2020).

The substantive claim involved hotlinking, or inline linking. The hotlinks appear in Google search results, and the claimant argued that Google enabled users to access content on his website via other hotlinking (or, more descriptively and I think more commonly, aggregating) sites - thus depriving the claimant's site of visitors and of advertising potential. Mr Wheat's website, at www.theirearth.com, was devoted to ecological and sustainability issues and contained original articles and photographs created by him. (It went offline in 2018.) He became understandably miffed when aggregator sites availed themselves of his content to attract visitors to their advertising-laden sites.

On an application to serve a foreign defendant outside the jurisdiction, the claimant must satisfy three
requirements (Seaconsar Far East Ltd. Bank Markazi Jomhouri Islami Iran [1994 ] 1 AC 438, 453-457, endorsed by the Privy Council in Altimo Holdings and Investment Ltd v Kyrgyz Mobile Tel [2011] UKPC 7, [2012] 1 WLR 1884. There must be a serious issue to be the on the merits; there must be a good arguable case that the claim falls within one or more classes of case where permission may be given to serve out ; and the claimant must satisfy the court that in all the circumstances the forum in which proceedings have been commenced is appropriate. The main issue, the judge (HHJ Keyser) decided, was whether there was a serious issue to be tried on the merits: substantive copyright law therefore had to be considered .

According to the case law , the claimant would have to show that Google had communicated his copynight works either to a new public or by a different technical means from that authorised by the claimant. The second possibility could be immediately knocked on the head: Case C-466/12, Svensson, EU:C:2014:76 makes clear that the whole of the Internet is a single technical means. But Svensson also tells us that because the publie to which the communication was made was within the class of potential visitors to the claimant's website , the first possibility was excluded too . The claimant argued that his initial consent to communication was subject to an implicit restriction was not supported by evidence. The Master had been correct in his interpretation and application of the case law. Google's acts of caching and indexing amounted to communication neither to a new public nor by a new technical means, and were not unauthorised communications to the public within the meaning of s.20.

Such is the result of the way the technical process works, and of the present state of the law. Surely copyright law should deal with the economic reality of the situation, though, and prevent parasites (oh, I hadn't intended that pun but it works rather well) from taking a free ride on someone else's original work. Perhaps Mr Wheat's mistake was to make his website freely accessible - but the whole ethos of what he was doing clearly required him to do so. The Internet is perhaps becoming no place for anyone who is not out to make as much money as possible, regardless of whose efforts that is based on. Or so it seems to me.

Originality requirement is the same for all works – including applied art

In a case involving the design of jeans and tee shirts, referred by the Portuguese Supreme Court, the Court of Justice has extended the scope of its Infopaq decision and held that the Euro-originality test, that a copyright work be its author’s own intellectual creation, applies to all types of copyright work including works of applied art. It is not open to Member States to protect works of applied art on the basis that they have some aesthetic appeal in addition to their utilitarian appeal: the only criterion is originality.

To be protected by copyright, a work must be the author’s own intellectual creation, reflecting the author's freedom of choice and personality. If the subject matter was dictated by technical considerations, rules or other constraints, which left no room for creative freedom, it would not be original. Only the elements that were the expression of creation in this sense would be regarded as a work - which sounds very much like the Court applying the "abstraction-filtration-comparison" test propounded by the Second Circuit in Computer Associates v Altai to determine what is protected rather than the English courts' approach of looking at the copyright work as a whole and filtering out unprotected subject-matter when applying the "substantial part" criterion for infringement.

Looking for an aesthetic effect to decide whether copyright applied was, the Court observed, subjective, and did not mean that the subject-matter of protection existed and could be identified with sufficient precision and objectivity. Aesthetic considerations were important in creative activities, of course, but a design's aesthetic effect did not in itself make it possible to decide whether the design was the author's own intellectual creation.

Clothing designs will perhaps rarely pass the higher originality test. In the UK this would not be a problem, as copyright is not the most apt way to protect them: they are more properly protected by design right, and in any case s.51 should exclude the use of copyright to protect the designs except where the item of clothing is itself an artistic work – which means it only works if the garment is a work of artistic craftsmanship, which it often will be but not if it is a tee shirt, or probably a pair of jeans. But the case raises the interesting question for the UK, does the Euro-originality test apply now to design right? The courts were always clear that they were not going to invent a new originality test for design right when they could just adopt the well-established copyright one, but that was before the Court of Justice drive a coach and horses through that test in Infopaq.

The judgment raises other important questions about EU copyright law – which almost with each passing day seems to be the way we now have to regard copyright, as based on EU directives. How the activist Court of Justice brought us to this position, developing the Information Society directive (which it seems always to refer to simply as "the Copyright Directive") into a comprehensive harmonisation of copyright law, is another story on which a lot has already been said and much remains to say.

Case C-683/17, Cofemel – Sociedade de Vestuário SA v G Star Raw CV EU:C:2019:721 (12 September)

Copying music without knowing

The Guardian this morning reports another case in which a piece of music was held to infringe copyright in an earlier piece. It happens more and more often, it seems - as the twin evils, long identified in the trade marks world, of depletion and foreclosure insinuate themselves into copyright, albeit with changes to their form to take account of the very different subject-matter of trade mark protection.

The case in the papers today was decided in the United States, and by a jury, which means that the same will not happen here, not by the same route anyway. Katy Perry's song Dark Horse was found to have a similar beat to a piece called Joyful Noise by Flame, a Christian rapper (a new genre to me). It seems that several others were accused of infringing, too.

For copyright infringement to happen, in the USA as well as in this country (and every other country that has a copyright law, which I think is every country although in some of them the situation is a bit unclear), there has to be a nexus between the copyright work and what an infringer has produced (you can't say the infringer created it, because the whole point is that he or she hasn't, nor can you call it a work because it doesn't represent work, just appropriation). If an alleged infringer has no knowledge of the copyright work in question, there is no infringement: there is a second, similar or identical, copyright work, created independently by the defendant.

Many copyright owners don't like this situation, of course. They would rather their copyright was a true monopoly right. But copyright law is not patent law, and quite right too. Copyright doesn't protect the piece of music (or the book, or the painting) per se, but the effort that the creator put into it. So the owner of copyright in a piece of music has to show that the defendant had heard that piece. The case law tells us that it isn't necessary to show that the defendant has to recall the piece - if that were the case, a little selective amnesia would be enough to defeat any infringement claim - but merely that they have been exposed to it.

To avoid being exposed to others' music, composers will not generally listen to the recordings that they might receive from aspiring composers hoping for an endorsement (or perhaps hoping to contrive a situation in which an infringement action might lie). But in the modern world it becomes much more difficult to avoid exposure to music. When it is playing, unnecessarily, in lifts, shops, restaurants, gyms, and workplaces, it's impossible to get away from. I might have heard Dark Horse and Joyful Noise many times, quite involuntarily, but I certainly don't recall either of them. Were I a songwriter, I might well have incorporated some part of them (one or other of them) in a work of my own. And to some extent that's how music gets written, and always has been.

What strikes me as novel in this case is that sheer numbers of YouTube views seem to have raised a presumption that Katy Perry and her co-authors must have heard it. That's frightening. I might be exposed to a piece of music in the gym, however hard I try to shut it out and concentrate on my workout, and therefore become a prospective infringer.

How can this be addressed? It's right that the copyright owner should get something when another composer appropriates their hard (or even not-so-hard) work. What is needed is a narrower concept of what amounts to actionable appropriation, as well as consideration of what damages should be awarded and whether there ought to be some sort of licensing scheme to cover some types of infringing act. In the Kay Perry/Flame case, the situation is complicated by the fact that a jury made the decision that there had been an infringement, and having a jury decide matters like that doesn't appeal to me as a sound way to deal with them. Perhaps that accounts for why just taking the beat was held to be an infringement. In the name of research I have listened to the two songs on YouTube, and indeed the beats are very similar, although they are also pretty mundane and I wonder where Flame's came from in the first place. A rigorous analysis of the originality of the claimed work would be the starting point for a more rational approach to questions of infringement.

Another important difference between UK and US copyright law is that while the UK law considers the originality of a work as a whole, US copyright law is more inclined to take the work apart and look for originality in its components. Here, it seems to me quite likely that an English judge, asked to consider the two, might remark that the beats sounded similar but that the two songs as a whole were so completely different that the similarities could not be considered substantial. Perhaps it's not a problem that would ever come to court in this country, but the fact is that US copyright casts its shadow over the whole world and we need to take care always to distinguish what goes on there from our own approach.

Book review: Copyright Law and Derivative Works by Omri Rachum-Twaig

Calling a work "derivative" is not a compliment, but there has been a tendency (since at least the Gowers Review) to consider the way that copyright laws treat derivative works as too restrictive. The author's starting point is the proposition that copyright regulates creativity: indeed, "regulating creativity" appears as a sub-title on the front cover. It seems to me that exploring creativity through the prism of derivative works is the wrong starting point, but I don't think it detracts from this fascinating and important book.
It seems customary these days to explain that one has been given a review copy of a book, so let me start by stating (though it seems pretty obvious to me) that I have been given a review copy of this book, published recently by Routledge at the eye-watering price of £115 - that being the main reason that declaring the gift of a review copy is surely redundant. I wouldn't go so far as to say that it's worth £115 of anybody's money, but it will be worth that much of some people's money, and it is a very interesting not-so-little (190 pages of real text) monograph, not padded out with lots of front- and back-matter.
After considering matters of quantum, always the first thing I notice about a book, I start to wonder about the author. He is, the book tells me, an adjunct professor of law at the University of Tel Aviv. The Internet tells me more, and I was particularly interested to read that his first degree is a Bachelor of Music and that he has had an impressive orchestral career already. That might have been his route into copyright law, but if it was it doesn't show in this book, and I found that slightly disappointing: but it doesn't claim to be a book about music copyright, so my disappointment is probably misplaced anyway.
The work, my reservations about the focus on derivative works notwithstanding, is an exploration of how well copyright understands creativity, compared with other fields of study: so, despite the title, it is quite light on black-letter copyright law - and more interesting for it, IMHO. It uses derivative works to inform its discussion of creativity, considering whether the law's treatment of the right to make derivative works (and its inclusion, generally, in the bundle of exclusive rights that the copyright owner enjoys) is compatible with what other disciplines teach us. The author examines the cognitive aspects of creativity before going on to look at genre theories (with an interesting discussion of how Sherlock Holmes derives from the work of Edgar Allen Poe) and the justifications for what he calls the "derivative works right", though I am not convinced of the need to identify it as a distinct instance of copyright protection - reproduction right ought to do the job.
But perhaps that remark just shows me to be unsympathetic to the argument that copyright, in the interest of encouraging creativity, should be more liberal in its treatment of derivative works: surely "derivative" is the opposite of "creative" or "original", and where a later creator wants to use another's copyright material it is a transaction that should be resolved by licensing, not by permitting otherwise infringing acts. A transformative work is another matter, and to my mind copyright should be encouraging the creation of such works rather than engaging in a sterile argument about creating space to make derivative works, space which already exists and is regulated by the requirement that making them requires the copyright owner.

No copyright in taste: Outbreak of common sense at Court of Justice

The Court of Justice has today handed down its judgement in Levola Hengelo [2018] EUECJ C-310/17 (13 November 2018), holding that the taste of cheese spread is not a copyright work. Why should it even have had to consider the matter? In UK copyright law it would surely have been disposed of very quickly, as taste does not fall into any of the categories of copyright work set out in the 1988 Act. But the UK is unusual among EU Member States in having a "closed list" approach to copyright works - more often, in the civil law world, the scope of copyright protection is not so constrained, which is how perfumes have achieved copyright protection in come countries. The Court of Justice has previously threatened (in Case C-393/09 Bezpečnostní softwarová asociace –Svaz softwarové ochrany v Ministerstvo kultury ("BSA")) to make the open approach EU-wide, so that whatever an individual might create will receive protection, but the present judgment neatly sidesteps that issue (or perhaps more accurately does not have to consider it) - of which more later.

The concept of a "work" is used in EU copyright legislation (in particular in the Information Society directive, 2001/29), but not defined. This invites an activist court to make up its own definition: "Accordingly, in view of the need for a uniform application of EU law and the principle of equality, that concept must normally be given an autonomous and uniform interpretation throughout the European Union (see, to that effect, judgments of 16 July 2009, Infopaq International, C-5/08, EU:C:2009:465, paragraphs 27 and 28, and of 3 September 2014, Deckmyn and Vrijheidsfonds, C-201/13, EU:C:2014:2132, paragraphs14 and 15)."

In the two cases it cites there, the Court decided that copyright works must be their authors' own intellectual creation, thus at a stroke making copyright much narrower than it had been - in the UK, at least. Not a bad outcome, to my mind, although the reasoning might not convince you. Here, the Court could have interpreted the word "work" widely: the only guidance it had was from Berne, which extends copyright protection to authors' literary and artistic works, and the TRIPS agreement and the WIPO copyright treaty, which tell us that expression not ideas is what copyright protects (which is IMHO another way of saying that copyright protects works).

However, very sensibly, the Court was not about to bring tastes within the scope of copyright protection. It told us that there are two cumulative conditions for something to be considered a "work":

36      First, the subject matter concerned must be original in the sense that it is the author’s own intellectual creation (judgment of 4 October 2011, Football Association Premier League and Others, C-403/08 and C-429/08, EU:C:2011:631, paragraph 97 and the case-law cited).
37      Secondly, only something which is the expression of the author’s own intellectual creation may be classified as a ‘work’ within the meaning of Directive 2001/29 (see, to that effect, judgments of 16 July 2009, Infopaq International, C-5/08, EU:C:2009:465, paragraph 39, and of 4 October 2011, Football Association Premier League and Others, C-403/08 and C-429/08, EU:C:2011:631, paragraph 159). [Emphasis added.]

The idea/expression dichotomy, which dictates that only expression can be protected by copyright, means that a work must be "expressed in a manner which makes it identifiable with sufficient precision and objectivity" - language adopted for the present case by Advocate General Wathelet from the Court of Justice's landmark decision in Sieckmann. The Court refrained from mentioning that case by name, which (as it is of course a trade mark case - although it was smell trade mark, so there is a connection) is a blessing - it gives us one less thing to worry about. Conceptually it's a sound approach, I think, but the idea that it rests on a precedent from another area of law is a bit uncomfortable.

Taste, like olfactory trade marks, cannot be pinned down with sufficient precision and objectivity and therefore cannot be a copyright work. Thank goodness. And thus the Court avoids the issue of closed and open lists of copyright works. It didn't even have to mention BSA, which remains a threat to our approach to copyright but not one that will allow cheese flavours to enter the copyright system.

No B****t dividend for authors

In the Public Lending Right Scheme 1982 (Amendment) (EU Exit) Regulations 2018 which were published on 13 August (they have not yet been laid before Parliament), the Government has paved the way for public lending right to carry on unchanged after the UK leaves the EU. As PLR is not a creature of EU law, you might wonder why this is necessary: the answer is that the Regulations will ensure that UK-resident authors will still be eligible to register for PLR after the UK is no longer a member of the EEA. This requires an amendment of the definition of "eligible person", effected by these regulations - made under the Henry VIII powers given by the European Union (Withdrawal) Act 2018.

The amendment inserts the words "the United Kingdom or" before "EEA", meaning that the geographical extent of the scheme remains the same - authors resident in other EEA countries (or, from "exit day", authors in EEA countries) will be eligible. Since PLR is distributed out of a set fund, the amount available per loan depends on how many eligible authors there are. Leaving the EU might have meant a huge reduction in their numbers - but it won't, and my PLR statements will probably continue to tell me that I haven't earned enough to justify the writing of a cheque. Still, it's not the sort of windfall I'd have wanted.

Where there's a hit there's a writ

The old saying doesn't work so well now we don't have writs any more, but anyway the litigation reported by the BBC today is taking place under US law. That also means that considering how it might pan out under English law is pretty speculative, but it does serve to illustrate some important points of copyright law.

The story is about the family of a playwright (a Pullitzer Prize winner, Paul Zindel) suing several parties concerned with the film The Shape of Water. The fact that it is tipped to win an Oscar or two goes some way to explaining why it has generated litigation - the simple fact is that if it wasn't a hit, it would not be worth the price of a writ.

The plaintiffs (they still have them in the USA) argue that the film is "in many ways identical" to Mr Zindel's play Let me hear you whisper. The defendants say they never heard of that play, although the article says that there was a TV production of it at about the time the idea of the film was forming in its writer's mind. The writer might have been exposed to it, and it's possible that subconscious copying took place. It's also possible that nothing of the sort happened, and that the "at least 61" ways in which the films are identical are down to the fact that if you tell a story about an aquatic creature kept in a laboratory and its relationship with a cleaner or janitor those similarities are going to happen. Like Hoehling v Universal Studios  618 F.2d 972 (2d Cir. 1980) which turned partly on the point that if you're going to make a film set in Nazi Germany you are bound to have scenes in beer halls and people giving straight-arm salutes.

US copyright law works differently from the way our copyright law works. Because it expressly excludes ideas from protection, US law requires the judge to go through what has become formalised as a three-step process of abstraction, filtration and comparison - to reduce the work to a copyright-protected "golden nugget" before putting it beside the alleged copy to compare the two. The equivelant in our law is the rule that copyright is infringed if the defendant has taken the whole or a substantial part of the work - it all comes down to substantiality at this stage. In other words (and if an American friend should happen to read this I stand to be corrected), US copyright law protects elements of a work which qualify for protection (which are the author's original work, basically) whereas the UK law looks at the work as a whole and asks whether it meets the originality standard, then considers whether a substantial part has been taken. This is a point that I have discussed before on this blog: it seems unlikely that any element which is not the author's original work could be regarded as a substantial part, but this is not an area of the law where everything is set in stone at present.

The news story is by no means a comprehensive disclosure of the facts, so it would be wrong to speculate much about the possible outcome, but an interesting illustration of copyright principles.

Transformative use

In trying to explain when a substantial part of a copyright work has been taken (and therefore an infringement might have taken place), I came up with what I thought was a great illustration. It helped, perhaps, that I was doing the teaching in Moscow, so Rachmaninov came easily to mind. Leaving aside the fact that there is no extant copyright to worry about in practice (in any case, Paganini died in 1840, 94 years before the Rhapsody was written), would it ever be thought that Sergei Vasilievich's Rhapsody on a Theme of Paganini (Opus 43) infringed Paganini's copyright, or that it was anything other than a completely original work?

To start with, listen to the last of Paganini's 24 caprices, which is where Rachmaninov got the Theme from, played here by Hilary Hahn:


Then listen to Rachmaninov. There are 24 variations in his Rhapsody, starting with a fairly literal statement of the theme (you can hear that in the last of these three clips). Maybe he would have had to clear that with the Italian virtuoso, had modern copyright law applied at the relevant time. But the point of variations is that they transform the theme, and by the time you reach the glorious and impossibly romantic variation 18 (played in this clip by Valentina Lisitsa with the London Symphony Orchestra conducted by Michael Francis) it has changed beyond recognition, turned upside-down by Rachmaninov to produce one of his greatest tunes (and I write "his" quite deliberately: it's no longer Paganini's).

The great pianist Stephen Hough explains what is going on in this clip.


Of course there are many other examples of authors (in the broad copyright sense) taking someone else's work and transforming it into something utterly original (in the copyright sense as well as the ordinary one), but I think this is a particularly good one as well as being a beautiful piece of music.

Note: "transformative" is not a word used in the Copyright, Designs and Patents Act 1988. It is mentioned as a description of a type of fair use in the US legislation, and it featured in the Gowers Review a decade or so ago - where it was suggested that there should be an "exception", created by by an amendment to Directive 2001/29/EC, in favour of "creative, transformative or derivative works" which would benefit what the Review called "the Hip Hop industry".

Theft: A History of Music

Thinking about how to engage students coming to intellectual property law for the first time is something that occupies my thoughts quite a lot these days. A copyright comic might be just the answer - and if it deals mostly with the law from that other common law jurisdiction across the Atlantic, that's not necessarily a disadvantage if the purpose of the exercise is to kindle interest rather than teach hard law. And if it has "theft" in the title I will be prepared to suspend my usual reaction to the connection of that concept with intellectual property.

A large part of grabbing a student's attention is finding a route into intellectual property law from somewhere they already know and like. Music provides an excellent entrée into copyright law - probably not Mozart, but possibly some of the more recent and high-profile cases, the two most celebrated of which were US cases (but there are many from the UK too). Music copyright is precisely what James Boyle and Jennifer Jenkins’ new scholarly comic book tells us about. It is (the blurb tells us) 'a celebration of these and other musicians and composers who crossed barriers and built the playlist of extraordinary Western music from ancient Greece to classical to hip-hop. Published by the Duke Center for the Study of the Public Domain, “Theft: A History of Music,” brings these artists’ musical borrowings to the forefront, saying that instead of stifling creativity, such “thefts” were essential to musical cross-fertilization and creation of new genres.'

The blurb continues: 'But the book also comes with a warning: At every point of new musical innovation, there was resistance and efforts to control music, whether it was from philosophers, the church, or politicians.'

You can read the full article here, and listen to James Boyle discuss the comic on NPR's The State of Things. The mere fact that it's the work (partly) of Jim Boyle is enough to sell it to me: he's an excellent writer and lecturer and I have enjoyed his work in the past, although this is the first comic book of his that I have read (the first comic book of any kind that I've read, since I gave up "war bluds" at school). I read it, pretty much in one sitting, and found it stimulating, entertaining and informative. It's going to be an ideal introduction to copyright concepts in courses I teach in the future, and best of all (coming as it does from individuals and an institution committed to the furtherance of the public domain) it's a free download. What  more could you ask?

Eminem in dispute about use of music in NZ party's election campaign

The amount of trouble that using popular music for election campaigns causes seems to be limitless. Not every party can rely on Lord Lloyd Webber to arrange some conveniently out-of-copyright Purcell for the occasion (though the Rondeau from Abdelazar is better known as the theme used by Benjamin Britten for his Young Person's Guide to the Orchestra, which makes it a strange choice for a Conservative Party campaign tune though it's certainly stirring enough). It features at the end of this election broadcast from 1992 - which is worth watching in itself, I think, reminding us of a very different political era.

New Zealand's National Party, for a campaign in 2014, didn't try Lord Lloyd Webber, but instead went for a piece called "Eminem-esque", which it bought from a stock music purveyor. An odd choice of artist, and genre, for a centre-right party to associate with, you might think, and it gets worse because unfortunately for the Nationalist Party it sounds very like Eminem's song "Lose Yourself" - an even more unwelcome association, you'd have thought: alluding to any song with the word "lose" in the title can't be a good idea. As the BBC reports, it has led to a copyright infringement suit. You can hear both pieces played in court here. Neither has the judge dancing in the aisle, and I'm left with the feeling that I would want to punish any political party that inflicted either piece on me. But that's not the point.

There are more and more cases like this coming to the courts - not the English courts, necessarily (I can't think of any cases like this) but there are plenty of others from elsewhere, whether involving politicians or not. There's a recent piece about it on IP Watch which mentions a new "scholarly comic book" (what an interesting concept) by James Boyle and Jennifer Jenkins, about which I am going to post separately.

In the last couple of years there's been Led Zeppelin v Spirit and Marvin Gaye (the estate of) v  Robin Thicke and Pharrell WilliamsAs a recent programme on BBC Radio 4 showed, there is a lot of activity in the area - with a new profession of forensic musicologist emerging as an important part of the picture. The fear of being sued for copyright infringement has a significant chilling effect on creativity, and especially on improvisation. A consequence of the fact that control doesn't lie with the musicians, but with the suits of the record company, and an illustration of how big business isn't content with the limited exclusive rights given by the copyright system, but strives to turn them into a true monopoly.

But back to the story ... The Nationalist Party seems to have taken the view that, if there were a copyright problem, it was the stock library's problem rather than theirs. I doubt New Zealand copyright law is different enough from ours to make that proposition any less risible than it would be if trotted out by an infringer here. Whether "Eminem-esque" does infringe copyright in "Lose Yourself" is another matter, but it does seem like a strong possibility.

Duran Duran and reversion of copyright

BBC News reports that the popular music combination Duran Duran have lost a claim in the High Court in which their music publishers sought to prevent them from serving notice to recover their U.S. copyright. Gloucester Place Music Ltd v Le Bon & Ors [2016] EWHC 3091 (Ch) (02 December 2016) is a relatively short (45 paragraph) judgment of Mr Justice Arnold, in his own words 'not without hesitation'. But there was little that he could do: the contract seems pretty clear. The various copyrights (and I don't like using the plural, though it seems appropriate here) were assigned for their full term, and to try to use section 203 of the U.S. Copyright Act to reclaim the rights after the statutory 35 years was contrary to the terms of the contract and amounted to a derogation from grant (reminding me again of BL v Armstrong, which I have been making my students in Nottingham read recently - it's good for the soul).

But surely (I hear you say) the statute overrides the contract? The right to a reversion of the copyright can't be contracted out of, can it? It seems that it can't - at least, on my reading of the provision, and perhaps a friend in the States will comment on this - but the parties went off to court under Part 8 on the basis that there was no dispute about the facts of the case, and the effect of the foreign law is a question of fact: and accordingly the defendants did not seek to adduce evidence evidence about U.S. law. Arnold J was asked only to interpret the contract, and that didn't create much difficulty for him.

It seems from the judgment that the defendants also failed to raise in the proper way a public policy point - although the learned judge indicated that he wasn't receptive to it anyway. There seems some merit in saying that an English-law contract, in which the parties agreed that the English courts should have jurisdiction, should not be allowed to interfere with the operation of a foreign statute.

Finally, the band members, quoted by the BBC, were miffed that they were suffering under a contract signed when they were young and innocent - a common complaint in the entertainment business, so much so that by 1980, when they signed up with the publisher, lawyers would take great care to make the contracts bulletproof. Their argument loses a lot of force, though, when you read the opening paragraphs of the judgment and learn that the 1980 contract had been terminated in 1983 and replaced with contracts with the band members' service companies. They might have been young still in 1983, but they were less innocent and presumably well-advised.

Monkey selfie: Animal charity Peta challenges ruling - BBC News

BBC News reported a while ago that Peta, the animal rights charity, with which I usually have complete sympathy, is arguing in a court in California that copyright in the now-famous macaque self-portrait belongs to the photographer. It sounds as if there is some dispute about which monkey took the photo (by which I mean pressed the shutter release or whatever it's called on a digital camera, as I can't imagine that he or she had the faintest idea what the action would lead to), but that leaves the main point that the charity argues that "[n]othing in the Copyright Act limits its application to human authors…".

I claim no particular expertise in U.S. copyright law, and am prepared to accept that there is at least an arguable case to support that proposition. Whether that justifies Peta spending charitable funds on a lawsuit which most would consider frivolous is another matter. Ever since I read Peter Singer's "canonical" (nice word - thanks Wikipedia) book Animal Liberation (here on Amazon), one of the many ways in which I distracted myself from the grinding boredom of articles of clerkship (1978-1980), I have tried to be as conscious of speciesism as of racism and sexism. I haven't perfected it, but I hope I have got close.

I can't put my hands on my well-worn copy (the paperback version of the first (1975) edition, published 1977) just at the moment, but I don't think it contains anything about animals' copyright. [later: I have found it now, and there is no entry in the index for "copyright" or "intellectual property", or even just "property", which isn't conclusive but will do for now.] In UK copyright law, the author of a work (and therefore, usually, the first owner of copyright in it) is the person who creates it. A person is (this from the Oxford Companion to Law) typically defined as "a being, entity or unit which can bear legal rights and duties". The word "being" without the adjective "human" seems to leave open the possibility of animals being authors. However, legal personality, the article in the Companion goes on, has to be distinguished from legal status, citing as an example that we can say the legal status of an animal [a non-human animal, I would add, not for the avoidance of doubt but to highlight the ambiguity or inaccuracy of the original statement] is that of property and that of a human is a person.* Professor Singer might, I imagine, take issue with the narrow definition of "person", especially as the whole point of his thesis is, as I understood it, that we should regard animals as having rights (though not necessarily accompanying duties). However, that is clearly the way the law works and I don't see any way for Peta to put forward a case for an alternative interpretation in the English courts, even if the Charity Commission would let them.

Now that I have found my copy of the book again, I'll search it for any suggestion that animals' rights should extend to owning property, and in particular intellectual property. I'm fairly confident that, however proprietorial some animals might be, Professor Singer didn't advocate extending legal personality to them to that extent.

Not Lucy's book

*See further, R. Tur, 'The "Person" in Law', in A Peacocke and G Gillett (eds), Persons and Personality: A Contemporary Inquiry (Oxford: Basil Blackwell, 1987), 121, and N Naffine, 'Who are Law's Persons? From Cheshire Cats to Responsible Subjects' (2003) 66/3 Modern Law Review 346. Professor Naffine is also the author of the article in the Oxford Companion to Law to which I referred and from which I repeat these two references.

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