From October 2016 to March 2017 the team is joined by Guest Kats Rosie Burbidge and Eibhlin Vardy, and by InternKats Verónica Rodríguez Arguijo, Tian Lu and Hayleigh Bosher.

Thursday, 19 January 2017

Does the economic impact of SPCs necessitate SPC Regulation reform? The European Commission wants to find out

The AmeriKat getting her weekly dose of SPC reform
courtesy of DG Grow
While the AmeriKat has otherwise been engaged in the world of life sciences, she received an email from Fabio Domanico this week, economist in DG-GROW's "Intellectual property and fight against counterfeiting" unit alerting her to the recently published SPC tender entitled "Study on the economic impact of supplementary protection certificates, pharmaceutical incentives and reward in Europe".

The Single Market Strategy, which was adopted in October 2015, announced that the Commission will:
"consult, consider and propose further measures, as appropriate, to improve the patent system in Europe, notably for pharmaceutical and other industries whose products are subject to regulated market authorisations". 
Then, on 17 June 2016, the Employment, Social Policy, Health and Consumer Affairs (EPSCO) Council (Health) adopted Conclusions on strengthening the balance in the pharmaceutical systems in the EU.  It invited the Commission to conduct an evidence-based analysis of the impact of the EU's pharmaceutical incentives, including the SPC and the “Bolar” exemption, on innovation and access to medicines.

Fabio explains:
"The study will complement the analysis of ongoing legal study on SPC (you published a post last year - see here), and it will also analyse other incentives as requested by the Council in June 2016. The study will in particular analyse the economic effects of SPCs for pharmaceutical uses (human and veterinary) and plant protection, data protection and market exclusivity for medicinal products for human use. Evidence on the overall impact on availability and accessibility of pharmaceutical care for patients and the pressure on health systems across the European Union will be examined. The evidence provided by this study will hence support the policymaking in those areas." 
The technical specifications of the Tender seem to identify five areas of the study to be explored as follows (with focus on SMEs, as well):

  • Overview of existing IP related incentives and rewards supporting pharmaceutical innovation in the EU and analysis of their actual use by innovators through out the entire product life cycle (focus on SPCs, data protection and market exclusivity) 
  • Overall economic effects of SPC, data protection and market exclusivity on innovation, availability and accessibility - An analysis of the current economic incentives of SPC and data protection, taking into account patent protection and the impact on availability and accessibility of pharmaceutical care for patients and the pressure of health systems across the European Union  
  • Economic impact of EU regulations on SPCs - Essentially, does the SPC Regulation meet the objectives in terms of scope and term of protection in accordance with the R&D investment and "lengthy market authorisation requirements"?
  • Economic impact of rules on data protection and market exclusivity for medicinal products, including the impact on innovation, availability and accessibility of the medicinal products concerned and the impact on the health of the population (through the development and availability of innovative medicines or the lack of access to them) and the financial sustainability of health systems
  • Economic analysis of the specific rules on market protection for orphan medicinal products in Regulation (EC) 141/2000 - The study aims to take into account the findings of the study on the economic impact of the Paediatric medicinal products Regulation, including its rewards and incentives and whether the incentives are proportionate to the goals of the Regulation in encouraging innovation, improving patients' access to innovative medicines.  

The analysis will be filtered into supporting policy making in two respects:

  • The Commission will use the study as one of the inputs into an evaluation report of the SPC system in the EU and to inform the decision on whether to come forward with a revision (notably with an option of establishing common SPC titles covering the entirety of the internal market)/scope and term/modification of the existing SPC system
  • In view of the 17 June 2016 Conclusions, the study will also contribute to analysing the impact of the incentives listed above on innovation, availability and accessibility of medicines in the EU as requested by the Council. 

The maximum amount of the tender is 280.000. The deadline to apply is on 8 February 2017.

A look at the proposal for the ePrivacy Regulation


Former Guest Kat Valentina Torelli, now associated with FJF Legal in Madrid, has graciously continued her coverage and commentary on EU developments in the area of privacy, this time in connection with the ePrivacy Regulation.

"As the use of digital services and Internet-based communications has become well-nigh ubiquitous, the underlying technology continues to evolve. Nevertheless, users
still have generic concerns about the inherent risks, especially those associated with security and privacy issues. Against that backdrop, the European Commission has established that increasing trust and security in digital services must be among the main objectives of the Digital Single Market Strategy. Accordingly, the long term goal for the reform of the EU data protection legal framework, which commenced in 2012, culminated last year in the adoption of the General Data Protection Regulation (GDPR), reported here and here, which will apply throughout the EU from 25 May 2018. However, in order to complement this new system with the right of individuals to data protection, the European Commission has also been engaged in updating the legal framework set forth in the Directive 2002/58/EC with respect to the processing of personal data and the protection of privacy in the electronic communications sector (Directive on privacy and electronic communications), whose last revision dates back to 2009.

As a result, on January 10, 2017, the European Commission published a proposal for a Regulation (ePrivacy Regulation), in view of the economic and social importance of digital services, the development of Internet of Things (i.e. connected devices and machines communicating through electronic communications networks, also known in literature as “Enchanted Objects”) and the rise of the so-called Over-the-Top communications services (i.e. services provided in the form of applications running over an internet access service, such as Skype, WhatsApp, Facebook Messenger, Imessage, and Telegram; Gmail, Facetime and Viber), all of which currently fall outside of Directive 2002/58/EC [for more details on OTT services and the scope of protection of the ePrivacy Regulation, see WP240, Article 29 Data Protection Working Party's opinion 3/2016 on the evaluation and review of the ePrivacy Directive (2002/58/EC)].

The purpose of these efforts has been to fashion a technologically neutral legal instrument, which can keep pace with future technological developments as well as to fully harmonize the privacy issues in all the EU Member States. (Regulations are secondary law having general application and are binding in their entirety and directly applicable in all European Union countries.) The published proposal has been modified from the version that was leaked in mid-December 2016. The main issues that the reform is meant to address can be summarized as follows.

1. EU wide application

As for the GDPR, the scope of protection of the ePrivacy Regulation covers any publicly available electronic communications services, either provided to or used by end-users in the EU, regardless of whether the end-user pays for them or not, as well as the information associated with the EU end-user's terminal equipment (see Article 1(1) of Directive 2008/63/EC for definition of terminal equipment). For the purposes of the ePrivacy Regulation, end-users can be either natural or legal persons, especially insofar as the consent to the processing of end-user's electronic communications metadata (traffic/location data) is concerned.

2. Scope of protection

The ePrivacy Regulation affords protection to fundamental rights and freedoms, such as the right to data protection and the freedom of expression, information, thought, conscience and religion, of natural and legal persons, regarding the provision and use of electronic communications services. In particular, it covers these rights with respect to one’s private life and communications and an individual's personal data protection. All the foregoing is directed towards ensuring the free movement of electronic communications data and services within the EU.

3. Confidentiality

The ePrivacy Regulation rests on the principle of secrecy of communications. Electronic communications must be confidential and interference therewith is prohibited, without the consent of the end-user concerned. The principle of confidentiality also applies to devices and machines that communicate with each other by using electronic communications networks. However, since the ePrivacy Regulation does not apply to activity falling outside the scope of the Union law, Member States may derogate its provision for the purposes of State security, defence, public security and crime enforcement.

4. Information stored on /retrieved from terminal equipment – Cookies

An end-user's consent for transparent purposes, about which the end-user has been informed, is the basic requirement for the use of a terminal equipment’s processing capabilities, as well as the storage thereon, for the retrieval of information from the equipment and the remote collection of information for identification purposes. Otherwise, the use of cookies and information collected from an end users' terminal equipment should be necessary in order to carry out the transmission of the communication over an electronic communication network or to provide an information society service requested by the end-users. This may be the case of cookies for remembering language preferences or tracking an end-user's input when filling online forms. Also, it seems that, as set out in Article 29 Data Protection Working Party's W240 above mentioned, (first party analytic) cookies applied to measure web traffic to a site are also legitimate.

5. Direct marketing opt-in/opt-out

End-users must give their opt-in consent in order for a natural or legal person to transmit direct marketing communications (i.e. for any advertising, whether written or oral), sent to one or more identified or identifiable end-users of electronic communications services, such as automated calling, an email, or a SMS message. Natural and legal persons are permitted to direct marketing of similar goods and services to those already sold to end-users, using their emails already collected in the course of those previous sales, provided that end-users have been clearly, distinctly and freely given the opportunity to object to such further use of their data.

Regarding direct marketing calls, the electronic communications services providers must supply a contact line to the end-user targeted and must use a code/prefix identifying that this is a marketing call. Finally, Member States may implement opt-out rules for regulating the expression of an end-user's consent in the context of voice-to-voice marketing calls, e.g. registering their number on a do-not-call list.

6. Privacy by design

By default, software permitting electronic communications, including web browsers, must be configured to impede third party cookies from being stored on an end-user's terminal equipment and to process information already stored on the equipment. Once the software has been installed, the end-user will be informed of the privacy settings options so to provide the consent to the installation.

7. Liabilities

Users of electronic communications services will be granted compensation for both material and non-material damage incurred by virtue of infringement of the ePrivacy regulation, unless the alleged infringer can otherwise exclude his liability. Also, the scheme of administrative fines set forth under the GDPR applies, namely up to a maximum of 20 million euros or 4% of the total worldwide turnover, whichever is higher, with respect to a breach of the rules of confidentiality, the processing of electronic communications content and metadata, as well as the erasure and anonymity of electronic communications data; or up to 10 million euros or 2% of the total worldwide turnover, whichever is higher, where rules on cookies are infringed, software providers do not fulfil their obligations of privacy by default or the providers of publicly available directories do not comply with their obligations towards end users.

8. Remedies

In view of the above, end-users of electronic communications services have the right both to commence a judicial actions before the courts of a EU Member State of her/his habitual residence and to lodge complaints before the Supervisory Authority of the place of residence, work, or alleged infringement of her/his rights under the ePrivacy Regulation.It is immediately apparent that the proposed ePrivacy Regulation is meant to be consistent with the GDPR. Both legal texts are to be read in conjunction with respect to an end-user’s privacy and confidentiality, where personal data are processed in the electronic communication sector. It is noted that the GDPR will apply to matters not specifically covered by the prospective ePrivacy Regulation, such as is the case for an individual's access, rectification, cancellation and opposition of an individual's personal data rights (A.R.C.O.) and the obligations on controllers and processors.

Finally, while the ISP's liability framework set out in the e-Commerce Directive will remain intact, the contemplated ePrivacy Regulation will be associated with the prospective European Electronic Communications Code (The European Commission's proposal was published on 14 September 2016 and the new legal text will recast the four Directives comprised in the EU regulatory framework of electronic communications: the Framework, Access, Authorization and Universal Service Directives) and will maintain synergies with the Radio Equipment Directive 2014/53/EU, providing that radio equipment should incorporate safeguards to ensure that the personal data and privacy of users and subscribers are protected.

As the ultimate objective is to make the ePrivacy Regulation applicable along with the GDPR, as of 25 May 2018, it seems that we can expect that the final text of the ePrivacy Regulation will be published during the next twelve months; IPKat will certainly monitor this."

Wednesday, 18 January 2017

Around the IP Blogs!


This kitten is delighted to bring you the highlights of some IP blogs!

Carefully selecting some IP blogs!
Marie-Andree Weiss of The 1709 Blog discusses the Paramount Pictures Corp. v. Axanar Productions, Inc. case (2:15-cv-09938-RGK-E), brought before the Central District of California, which involved the unauthorized production of a 21-minutes film entitled Prelude to Axanar and planning the production of a full-length movie (Axanar), both crowdfunded by Star Trek fans. 

Hirotaka Nonaka of TrustinIP considers the first criminal case in Japan involving book scanning services. The High Court found that such services, comprising the cut and scanning of books per client’s request, amount to copyright infringement.

Moving to designs, Paul Tjiam and Hidde Koenraad recaps on MARQUES Class99 the decision issued by the District Court of the Hague in the consolidated cases Samsung Electronics Co Ltd v Maxperian NL BV and Samsung Electronics Co Ltd v Digital Revolution BV [ECLI:NL:RBDHA:2016:14383, para 4.74], which held that toner cartridges can be protected under Community Design rights because they are not component parts of a complex product.

Moving to trademarks, MARQUES Class 46 announces the publication by Sweet & Maxwell of the first European Trade Mark Reports (ETMR) of 2017. The January 2017 issue includes reports of recent decisions from IP offices, national and EU courts. 

Staying with trademarks but moving to Latin America, José Luis Alvarez details on IP tango the opposition system in Mexico, which in the opinion of this kitten merely provides certain regulations (by establishing a deadline and fee) regarding the Mexican practice that was known as “third party observations” (see IPKat post related here). 

Moving to patents, Patricia Covarrubia reports on IP tango about Resolution No. 175/2016, issued by the National Institute of Industrial Property (INPI) of Brazil, which makes permanent the “Green Patent” program, giving priority to the examination of inventions related to eco-friendly technologies. Also, IP tango covers the meeting of the PROSUR Directorship Committee, which addressed the Patent Prosecution Highway (PPH) program as well as the plans for 2017 and the extension of funding by the Inter-American Development Bank. 

Over at PATENTLYO, Dennis Crouch blogs about the non-precedential decision In re Chudik, issued by the United States Court of Appeals for the Federal Circuit, which involved whether a functional limitation contained in a claim can be found in the prior art. 

Staying with patents, as IPKat member Neil Wilkof discusses on IP Finance the challenges faced by the world’s largest generic drug company, Teva Pharmaceutical Industries Ltd (based in Israel), but whose most successful product in recent years has been the proprietary drug COPAXONE. 

Finally, Stéphanie Faber recaps on GLOBAL IP & PRIVACY LAW BLOG the changes to the Consumer Protection and Tourism Codes, introduced by the French Digital Republic Bill, regarding how the information must be provided by online platforms, social networks, forums and chatrooms.

Never Too Late: If you missed the IPKat last week!


New Year New Cat 
Too busy working on those new year’s resolutions to keep up with IPKat this week? No problem – here is the 130th edition of Never Too Late.

InternKat Tian reviewed Dr. Qiao Yongzhong's book “Maintenance time and the industry development of patents -- empirical research with evidence from China

Full low down on the interim decision handed down by Mr Justice Carr on 29 December in the biosimilars battle of Fujifilm Kyowa Kirin Biologics Co., Ltd and Others v AbbVie Biotechnology Limited [2016] EWHC 3383 (Ch).
The European IP Institutes Network (EIPIN) is recruiting 15 PhD candidates wishing to conduct doctoral research on the role of IP in the adaptive complexities of innovation.

Neil looked at an example of co-branding employed by a senior citizen facility

And the weekly round ups Sunday Surprises and Around the IP Blogs

PREVIOUSLY ON NEVER TOO LATE 

Never Too Late 129 [week ending on Sunday 1 Janurary] A Kat's 2016 Copyright Awards I Happy Public Domain Day! I The champagne of trade mark disputes I Jaguar Land Rover DEFEND[ER]s its trade mark I Länsförsäkringar, Länsförsäkringar, bork, bork, bork! I Passing off the National Guild of Removers and Storers I Fuss over function: In case you missed the annual IP-World Christmas party I The Supreme People's Court of China's Michael Jordan Trademark Decision I Intermediary IP injunctions: what are the EU implications of the UK experience? I Swedish Supreme Court has ruled that sport broadcasts are not protected by copyright I Swedish Patent and Registration Office refuses registration of figurative mark because contrary to morality and public order I Never too Late I Around the IP Blogs

Never Too Late 128 [week ending on Sunday 25 December] | Sunday Surprises | A TITANIC trade mark dispute | Book Review: two new methodology books for EQE candidates: Smart in C and Tactics for D| Around the IP Blogs| Around the IP Blogs | Before there was copyright there was censorship: the tale of "The Feast in the House of Levi” by Veronese | Permission to appeal in patent cases - farewell to the Pozzoli approach | Permission to appeal in patent cases - farewell to the Pozzoli approach | EPO bows to EU Commission on patentability of products of essentially biological processes | Monday Miscellany | Groundless threats - Nvidia v Hardware Labs | 

Never Too Late 127 [week ending on Sunday 18 December] | Around the IP Blogs | Top-level Property Rights Protection Guideline released in China | CEIPI/EAO Conference--"Copyright Enforcement in the Online World" | More on the Swedish application of GS Media | Mini UPC Update: UK signs Protocol on Privileges & Immunities | When a holiday e-card meets IP: Well done, IPOS! | Unregistered designs for eXreme storage | Academic publishing houses lose appeal against Delhi University & photocopy shop | GS Media finds its first application in Germany | Monday Miscellaneous | Part 36 offers in the IP Enterprise Court

Never Too Late 126 [week ending on Sunday 11 December] | Will Iceland's EU trade mark end up on ice? I Obviousness over the CGK - dead or alive? I Will UK industry suffer from Government's "ratify now, repent at leisure" UPC stance? | Indian Trade Marks Registry to widen its doors for recording “well known” marks | Mediaplayers and streaming: AG Campos Sánchez-Bordona in Filmspeler proposes broad interpretation of notion of 'indispensable intervention' | AIPPI Rapid Response Report: Debating Lyrica's recurring pain on plausibility, abuse and infringement | PPDs and standard disclosure - can you have your cake and eat it? | BREAKING: Unanimous Supreme Court in Samsung v Apple finds that damages may be based on a component, not whole product | (Belatedly) remembering Raymond Niro, the most influential person in patent litigation whom you may have never heard of | Genuine use of three dimensional EU trade marks - heated arguments over ovens | Wild Boys Sometimes Lose It: Duran Duran fail to reclaim their US copyright |Around the IP Blogs 


Photo credit: Steve Jurvetson

Tuesday, 17 January 2017

BGH: to cease means to recall

We would like to bring the attention of our German Readers a recent decision (published 13 January 2017) of the Federal Court of Justice (Bundesgerichtshof, BGH) with far-reaching implications for practitioners. In essence, the BGH held that any prohibition to distribute a product entails an obligation to actively recall any products already on the shelves, endorsing the view expressed by the Oberlandesgericht Munich in 2013. The same dispute has already led to a  judgment of the ECJ on 23 November 2016 (not related to the enforcement of the order).


Plaintiff had obtained an injunction based on unfair competition law (UWG) against the mareting and distribution of alcoholic beverages under the signs "RESCUE DROPS" and "RESCUE NIGHT SPRAY" ("es zu unterlassen, im geschäftlichen Verkehr als Spirituosen gekennzeichnete Produkte unter der Bezeichnung „RESCUE TROPFEN“ und/oder „RESCUE NIGHT SPRAY“ zu bewerben und/oder zu vertreiben"). By its wording, the order only entails an obligation to cease and desist, and not any obligation to actively recall any products. The order became provisionally enforceable.

Defendant failed to recall any products already sold to retailers (primarily pharmacies). Plaintiff argued that this violated the order - and prevailed. The BGH held that in a case where the continued presence of the products on the shelves of retailers creates a continued disturbance ("fortdauernder Störungszustand"), the obligation to cease and desist includes the obligation to remove the continued disturbance, although generally, an obligation to cease (Unterlassungspflicht) must be distinguished from an obligation to remove (Beseitigungspflicht). It was further irrelevant that the buyers of the products were not obliged to comply with any request for a recall of the products (since they have become the legal owners of the products). The key reasoning is in paras. 24-27 of the decision for those who read German.

While the injunction in this case was based on unfair competition law, it is hard to see that the outcome would have been any different for a prohibition based on trade mark, copyright or patent law. In essence, any obligation to cease distribution of a product in Germany in the future also entails the obligation to recall products already distributed (and not yet used up). Failure to do so makes the Defendant liable to pay the administrative fine imposed by the order in case of non-compliance - in the case at hand, EUR 15,000 for the omission of recalling the products.

Monday, 16 January 2017

Social media, "WikiLeaks" and false news in the 18th century: Thomas Jefferson and the "Mazzei letter"


In today’s public discourse, nothing is more super-charged than social media, "WikiLeaks" and false news. We like to think about these issues as something new. However, if we discount the internet and digital context and look through a much longer historical lens, we see that the issue is really about platform, dating back to the advent of the printing press and the mass distribution of printed contents. In the Biblical words of Kohelet/Ecclesiastes, "there is nothing new under the sun". And at the end of the 18th century, this sun blazed no brighter than on the “Mazzei letter” affair, involving the later-to-be vice-president and thereafter president, Thomas Jefferson. At issue were two of the primary means of communication at the end of the 18th century, the letter and the newspaper, one a private matter and the other inherently public. The "Mazzei letter" affair shows what can happen when this separation between the private and public was breached.

The political dynamics of the nascent American republic in the early 1790’s (remember the U.S. Constitution had been ratified only in 1788) witnessed an ever-increasing split between Jefferson and the ruling Federalist party led by President George Washington and Alexander Hamilton, especially over relations with France and England. Jefferson was an ardent supporter of France, having been energized by the French Revolution. In 1794, John Jay was sent by President Washington to England to negotiate a treaty (the Jay Treaty), which put an end to the dispute between those two countries.

The treaty enraged Jefferson, to the extent that when, on April 24, 1796, he wrote a private letter to a former neighbor in the United States, Philip Mazzei, now living in Pisa, Jefferson could not resist adding several sentences about the political situation. He described the Washington presidency (and by extension, the Federalist party) as “[a]n Anglican, monarchial and aristocratical party”. The distinguished American historian, Gordon Wood, summarizes the gist of Jefferson’s dissatisfaction with Washington as follows (“Empire of Liberty”, p. 235) —
“[Washington] was trying to subvert the American’s love of liberty and republicanism and turn the American government into something resembling the rotten British monarchy.”
Jefferson’s own words were much more graphic—
“It would give you a fever were I to name to you the apostates who have gone over to these heresies, men who were Samsons in the field and Solomons in the council, but who have had their heads shorn by the harlot England.”
So far, what we find is an instance where a person lets his political hair down in writing to a friend (and we should keep in mind the rich tradition of epistolary communication at that time). That should have been the end of it. But it was not. What happened was a series of translations, publications and reproductions of the “political” portions of the letter, spanning countries and exploiting the social media of that era, accompanied by claims of distortion and worse of the original text. According to Wood, Mazzei translated these portions of the letter into Italian for publication in a newspaper in Florence (but see below). From there, it found its way to a French version that was published in France. The French version was later translated into English for publication in the American press, shortly after Jefferson had begun to serve as the vice-president under the Federalist president, John Adams.

But it is not so certain that there ever was a published translation into Italian. The Editorial Note to the Papers of Thomas Jefferson concludes that “[t]he Editors, however, have found no trace of an Italian publication …”, although Jefferson himself apparently believed so. At most, Mazzei may have translated the contents in Italian for an acquaintance in the diplomatic corps. The Editors suggest that Mazzei most likely copied the relevant contents in their original English and shared it with two friends, one of whom upbraided Mazzei for circulating the text without permission. Mazzei’s motivations for making the copies and dispatching them are not clear. Also not clear is exactly who translated the contents into French (perhaps from the original English, perhaps from an Italian translation) and who forwarded it to the French newspaper, Le Moniteur Universel.

What then happened in the United States is particularly noteworthy, involving, as it did, translations into English from a translation into French from either an Italian translation or from the original English text. As the Editors write--
"Three and a half months after the extract's appearance in France, the Federalist editor of the New York Minerva, Noah Webster, obtained a copy of the French newspaper from Epaphras Jones, a New York City merchant and ship owner who had recently returned from France. Webster arranged to have the extract and the Moniteur's subjoined paragraphs translated into English and printed in the 2 May issue of his newspaper. Subsequent mentions of it appeared in the Minerva on 3, 4, 6, 8, and 19 May. When Jones requested the return of his French newspaper, Webster made a copy for himself and had it certified by James Kent on 22 May. Webster also noted that Timothy Pickering, then secretary of state, “sent to me for the original paper, and had the letter in the original with a translation, if I mistake not, published in the Gazette of the United States”. After its publication there on 4 May, Pickering had his own copy prepared and certified by his chief clerk for his files (on 3 June). Pickering returned the newspaper to Webster. The extract in the Moniteur, of unclear lineage, had by then become the official version of Jefferson's letter, from which all American subsequent versions derived" [footnotes and citations omitted].
American newspapers. pro and anti- Federalist, pro and anti-Republican, themselves published the contents in English (not based on the original English text, but from an English translation from a French, and perhaps even before then, an Italian version.) Sometimes this derived English text was accompanied by commentary, itself not infrequently expressed in the most scurrilous terms. As Wood describes, Federalist opponents of Jefferson read out the these portions on the floor of the Congressional House of Representatives, and one congressman then proclaimed: “Nothing but treason and insurrection would be the consequence of such opinions.” Claims were made about the accuracy of the English text and Jefferson defenders even challenged the attribution to Jefferson as the author of the text (which apparently he never denied). The controversy over the letter hounded Jefferson throughout the rest of his life (he died in 1826).

With one ear attuned to the public discourse of our own moment, what do we make of the "Mazzei letter" affair? Once the letter left Jefferson's hands (presumably he did not make a copy), it was left to the whims of the social media of the day. The role of the newspapers was crucial. As Wood observes, all parties involved sought—
"… a way of dealing with the immense power over public opinion that newspapers were developing in the 1790's. In fact, the American press had become the most important instrument of democracy in the modern world, and because the Federalists were fearful of too much democracy, they believed the press had to be restrained" (p. 250) [but the Federalists lost political power forever by 1800].
Then, as now, IP seems to have played a minor role, if any. At least in the 1790's, one could point to the fact that the copyright laws were in their infancy (translations were in any event not yet protectable) as well as to the absence of protection for privacy and confidences. The dispute over the unauthorized publication of the private etchings of Prince Albert and the recognition of a right in confidences was still over 50 years away (Prince Albert v. Strange).

Still the last word, as the first, belongs to Kohelet/Ecclesiastes—"there is nothing new under the sun".

By Neil Wilkof

Friday, 13 January 2017

Arrow declarations can be granted: Fujifilm v AbbVie

The Court of Appeal decided yesterday that the High Court can, as a point of principle, properly grant declarations that a product lacked novelty or an inventive step at a particular date, see Fujifim Kyowa Kirin Biologics Co., Ltd v AbbVie Biotechnology Limited and Others [2017] EWCA Civ 1. This issue will now be considered at trial - the first of which is due to commence on Monday 16 January 2017.  A declaration in these terms is described as an Arrow declaration, due to the form of relief sought in Arrow Generics Limited v Merck & Co. Inc. [2007] EWHC 1900 (Pat), which settled before trial.

Context

This decision is the latest instalment in the epic battle concerning AbbVie's blockbuster Humira product, and Fujifilm Kyowa Kirin Biologics (FKB's) attempts to clear the way for its biosimilar launch (see last week's post here).  The first appeal concerned a decision of Carr J where he refused to strike out a claim for an Arrow declaration (as previously reported on the IPKat by Annsley here).  The second appeal was from decision of Arnold J and concerned the availability of an injunction to support an Arrow declaration (see previous IPKat post here).  The background to the dispute can be found in the posts referred to above. 

The precise form of the declarations of invalidity sought by FKB are set out at paragraph 43 and 46 of the Court of Appeal judgment.  The aim of the relief sought is to protect FKB from any subsequent infringement action brought by AbbVie based on divisional applications once they proceed to grant, in respect of FKB's biosimilar product.

AbbVie's challenge to the relief sought by FKB and s74 Patents Act

AbbVie contended that Arrow was wrongly decided, and that actions for Arrow declarations are precluded by s74 of the Patents Act 1977 because they put the validity of a patent in issue.  Floyd LJ summarised AbbVie's complaint concerning the relief sought by FKB as follows:  by asserting that the dosing regimen is old or obvious, the Arrow declarations (if obtained) would be making it clear that a future patent claim to that regimen would be invalid. Accordingly, if AbbVie were to obtain the grant of claims in that form, the resulting patent would have been pre-emptively adjudged invalid. There is therefore implicit in the Arrow declaration, an inter partes declaration of invalidity of a putative patent, not yet granted, having those claims.

Section 74 of the Patents Act is entitled "Proceedings in which validity of patent may be put in issue", and section 74(1) provides a list of proceedings where the validity of a patent may be put in issue. Section 74(2) then provides that:

"The validity of a patent may not be put in issue in any other proceedings and, in particular, no proceedings may be instituted (whether under this Act or otherwise) seeking only a declaration as to the validity or invalidity of a patent."

Court of Appeal decision

The Court observed that the primary purpose of section 74 is to ensure that proceedings in which the validity of a patent is put in issue will always be before a court or tribunal which has jurisdiction under the Act to revoke the patent if the grounds of invalidity are made out.  Section 74 is also concerned with putting in issue the validity of granted patents.  The Court of Appeal accepted that the Patents Act is a complete statutory code for challenging the validity of a granted patent, but noted that the Arrow declarations sought do not declare any patent invalid.  On the facts, there are now no longer any granted patents in the background in relation to which they could have that effect. The Court of Appeal concluded that there is nothing in the scheme of the EPC and the Patents Act to prevent an Arrow declaration where there is real justification for their grant. 

The Court of Appeal's summarised the legal position as follows:

i) A declaration that a product, process or use was old or obvious at a particular date does not necessarily offend against section 74 of the Act.

ii) Such a declaration may offend against the Act where it is a disguised attack on the validity of a granted patent.

iii) Such declarations do not offend against the scheme of the EPC or the Act simply because the declaration is sought against the background of pending divisional applications by the counter-party.

iv) On the other hand the existence of pending applications cannot itself be a sufficient justification for granting a declaration.
v) Whether such a declaration is justified depends on whether a sufficient case can be made for the exercise of the court's discretion in accordance with established principles.

An Arrow declaration is a discretionary remedy

The granting of an Arrow declaration is a matter of the Court's discretion.  The Court of Appeal was careful to note that "A claimant cannot seek an Arrow declaration simply because it would like to know whether a patent application in the course of prosecution will result in a valid patent. The course envisaged by the statute is that he should wait and see what, if any, patent is granted. The statutory remedy does not constitute a bar in principle to the granting of declaratory relief in appropriate cases, however. Where, for example, it appears that the statutory remedy is being frustrated by shielding subject matter from scrutiny in the national court, it should be open to the court to intervene."

The Court of Appeal was more hesitant about the justification for granting an injunction in the terms sought.  However, it was not minded to strike out the claim for an injunction at this stage, and noted that "an appropriately framed injunction may be an alternative to the declaration".

The appeals from these strike out applications were therefore dismissed.   

Tuesday, 10 January 2017

Guest Post - China's Patent Boom

The IPKat is delighted to receive this guest post from Yangjin Li (details at the end of the post)

World Intellectual Property Organization recently published its annual World Intellectual Property Indicators report. This report states that, amid rising worldwide demand for intellectual property rights, a new record was set. Namely, with around 1.1 million new patent applications in 2015, the State Intellectual Property Office of China (SIPO) became the first patent office to receive more than a million applications in a single year. This was almost as many applications as the next three offices in the ranking combined (the patent offices of the U.S., Japan and South Korea). Some people are astonished and also confused about China’s patent boom in recent years: What drives such a strong growth in patent applications? How good is the quality of the massive applications? What impacts does the boom have on patent protection in China? This article briefly discusses some aspects of these questions.

What drives China’s patent boom?

First of all, the growth of patent applications is accompanied by China’s strong economic growth. The continuing industrialization, the rise in market competitiveness and R&D investments naturally lead to more innovations. However, the single-digit growth in R&D investments (8.9% in 2015) can only partly explain the double-digit growth of patent applications (18.7% in 2015). Apparently, other driver-factors also play a role.

As widely known, a significant part of the growth can be attributed to the Chinese government’s patent-promoting policies. Direct subsidies on patent filling fees, sometimes coupled with rewards for granted patents, are regularly offered by the government. Besides, many other innovation-promoting programs, such as the certification of the prestigious High and New-Technology Enterprise (HNTE) status, which gives the enterprise a 10% deduction in corporate income tax, are also linked to the performance in patent output. These policies incentivize patent filling enormously.

Besides the direct policy incentives, it seems that a momentum has been built up among many Chinese companies that are transitioning from low cost manufacturers to creators of more advanced technologies. More and more companies are actively seeking to build up a large patent stockpile, in order, on the one hand, to establish an image of innovator, and on the other hand, to secure an optimal competitive position in patent competition.

These self-initiated attempts to accumulate patents are further fueled by low-priced patent agent services. Low-priced patent agents in China charge a flat-rate of several hundred Euros for drafting, filling and prosecuting an entire patent application. Considering that a similar service can easily cost a patent applicant several thousand Euros in the U.S., Japan or any of the major European patent jurisdictions, the cost burden on these Chinese applicants is really low and thus hardly deters them from applying more. 

How good is the quality of the massive applications?

Logically, one may have doubts about the quality of the massive applications. One can at least rest assured that all of the 1.1 million patent applications filed in 2015 will sooner or later be undergoing substantive examination. However, it raises questions about the SIPO’s examination capacity. As SIPO continues building its examination capacity to meet the rapidly growing demand, the workload and the skills of examiners, particularly those newly recruited examiners, may well influence the reliability of the examination.

Even among the granted patents, quality differences exist. According to the SIPO’s statistics, by 2015, patents granted to domestic applicants have on average 7.3 pages of specification and 7.8 claims, while patents granted to foreign applicants have on average 18.5 pages of specification and 17.4 claims. This demonstrates the overall inferiority of the indigenous patents in the thoroughness of patent drafting, the extent of technical disclosure and probably also the value of the inventions.

What impacts does the boom have on patent protection in China?

A direct consequence affecting many businesses operating in the Chinese market is that the risk of patent infringement keeps increasing and may become hard to manage. A lot of resources must be spent on conducting freedom-to-operate analysis, monitoring patent activities in fields of interest, invalidating wrongly granted patents and responding to potential infringement lawsuits. This presents a difficult situation especially for foreign businesses due to the language barriers.

Also, low-quality patents can be strategically used as bargaining chips to ward off infringement lawsuits. That’s to say, a patent infringer, who itself has a large low-quality patent portfolio, can try to use its low-quality patents as threat of retaliation to defer the holder of the actually infringed patent from starting an infringement suit. As a consequence, the value of high-quality patents deteriorates.

On the positive side, China’s recent patent boom makes a great contribution to raising public awareness about patent protection and fostering the development of a large group of patent professionals, from examiners and agents to lawyers and judges. Moreover, the published patent applications become a huge reservoir of prior art documents, which facilitates future patent examination. Given that China's first modern patent law was instituted just three decades ago, the recent patent boom surely helps lay a solid foundation for continued positive development in the future.


About the author: Yangjin Li works as a patent engineer at an IP law firm based in Munich. He is a co-founder of the legal blog Trustinip.com.  

Monday, 9 January 2017

Watch out lawyers - do you own your name?

That which we call a rose
Do lawyers own goodwill in their name? The UK's IP Enterprise Court tells all in Bhayani & Anor v Taylor Bracewell LLP [2016] EWHC 3360.

This was a summary judgment decision which focused on the question of whether a partner or the firm owns the goodwill she develops in the course of her professional duties and whether she can stop the firm from continuing to use her name when she leaves the partnership.

The dispute arose when a partner, Ms Bhayani, left Taylor Bracewell but the firm continued to use a sub-brand she had developed and for which the firm had registered a trade mark: Bhayani Bracewell.  Ms Bhayani alleged passing off and revocation of the trade mark on the basis that use of the trade mark was liable to mislead the public that she was still a partner at the firm (under section 46(1)(d) of the Trade Marks Act 1994).  The partnership agreement was also considered in light of both issues.

Season's Greetings and Goodwill to all mankind 

Goodwill, the first limb of the passing off "trinity" was the primary focus of the hearing.

It was accepted that Ms Bhayani had acquired a reputation in the field of employment law.  However, reputation is not the same as goodwill and on its own is not sufficient to found an action for passing off.   So, whilst an individual partner may have a professional reputation, it does not follow that they own the goodwill in their name.  As HHJ Hacon noted "goodwill cannot in law subsist as a thing alone - it is indivisible from the business with which it is associated."  Therefore, in the normal course of things the goodwill generated by a partner's acts will vest in the partnership.

The judgment did go on to consider some circumstances in which an employee (or partner) could generate goodwill of their own.  For example:

Landa v Greenberg [1908] 24 TLR 44 - a contributor to a weekly column in The Jewish Chronicle under the name "Aunt Naomi" was granted a declaration that she was entitled to the Aunt Naomi name and an injunction to prevent the new proprietor from continuing to use the name.  

Dr Crock & his Crackpots
Hines v Winnick [1947] Ch 708 - "Dr Crock" from Dr Crock & his Crackpots (an orchestra on a BBC radio show called Ignorance is Bliss) sued when the defendant tried to replace Dr Crock with a new performer.  The judge was referred to Landa v Greenberg and granted an injunction against continued use of the Dr Crock name on the same basis.

Forbes v Kemsley Newspapers Ltd (1951) 68 RPC 183 - "Mary Delane" wrote various articles in the Sunday Times under a pen name which was chosen by the defendant.  Her contract was terminated but the defendant continued to publish under the Mary Delane name  The judge noted that "a person who writes under a pseudonym is entitled to the property in that name as part of his or her stock-in-trade unless there is a term, express or implied, to the contrary in an agreement with an employer".  There was no such term so the claimant was granted her injunction.

Irvine v Talksport [2002] EWHC 367 - TalkSport created a brochure which used an image of Eddie Irvine with a TalkSport branded portable radio superimposed on the image.  Irvine brought a successful action for passing off on the basis that the brochure falsely represented that Irvine endorsed the TalkSport radio station.

These cases were distinguished on the basis that they either related to (i) writers/performers  so the court assumed that the public would consider the artist to be solely responsible for their creative output or, (ii) in the case of Irvine, to a separate business to his contract with Ferrari as a racing driver.  In other words, Irvine endorsed products as part of a separate business and consequently had generated a distinct goodwill which was his and on which he could found an action for passing off.

Because Ms Bhayani's reptuation had all been carried out at law firms (rather than sole proprietorships), there was no separate business which could be characterised as belonging to Ms Bhayani.  This meant that the goodwill in her name vested in Taylor Bracewell and her previous firm.  No goodwill meant that the passing off action could not possibly succeed.

Careful contract reading can avoid later drama
A further observation

Under this intriguing heading, HHJ Hacon went on to suggest that if a firm continued to represent a solicitor as being employed by them after their departure from the firm it would be possible to take action against them either on the basis that (i) the goodwill associated with the name of the solicitor vests in their new firm and/or (ii) there has been an injurious falsehood.

Partnership agreement

The partnership agreement further strengthened Taylor Bracewell's case although it did explicitly note that Ms Bhayani was free to use her own name in the course of trade now that her employment at the firm had ceased.  This agreement, arguably, also gave Taylor Bracewell a contractual right to continue using the Bhayani Bracewell mark.

Revocation of a trade mark which is liable to mislead the public

Section 46(1)(d) of the Trade Marks Act 1994 provides that:
(1) The registration of a trade mark may be revoked on any of the following grounds— ... (d) that in consequence of the use made of it by the proprietor or with his consent in relation to the goods or services for which it is registered, it is liable to mislead the public, particularly as to the nature, quality or geographical origin of those goods or services.
Ms Bhayani claimed that Taylor Bracewell's use of Bhayani Bracewell was liable to mislead the public that she was still associated with the firm.  The judge agreed that this argument had a realistic prospect of success and thus declined to strike out the claim.

Sunday, 8 January 2017

Around the IP Blogs


In December of 2016, the U.S. Copyright Office released a Report on Software Enabled Consumer Products. Notably, the U.S. Copyright Office believes that, at least in the context of copyright law, that there is not a need for new legislation -- current flexibilities in the law can accommodate technological change. 

Mike Mireles reports the recently released Highlights report by Association of University Technology Managers (AUTM) concerning its FY2015 annual survey, and explains why the results of the survey are promising. 

CopyKat, PasteKat...

JIPLP’s Editorial board member Danny Friedmann (IP Dragon and Simone Intellectual Property Services Hong Kong) shared some interesting comments on Hong Kong's new patent system, following the changes introduced by the Patent (Amendment) Bill 2015.


Tibbie McIntyre brings the first CopyKat of the year -- Disney’s Lightning McQueen wins in Chinese Copyright case, Cars vs. Autobots. 

The Delhi High Court has restrained 3 domestic collection societies from granting any such license till April 24th 2017 -- turns out that only registered societies can grant licenses in respect of copyrighted work(s). 
The fashion law blog brings an exclusive report of the case: BURBERRY LIMITED (UK) ET AL V. MOISEE, 1:16CV05943 -- After filing a strongly-worded trademark infringement suit against rapper Burberry Perry this summer in the U.S., Burberry has been handed the final victory in this “irreparable harm” case. 

Lessons from Chanel and Coty’s "Smell-Alike" Victory
A Netherlands court has held that use of perfume comparisons constitutes trademark infringement when it crosses the boundaries of comparative advertising. The flourishing trade in “smell-alikes” is a thorn in the side of the makers of well-known perfumes, including Chanel and Calvin Klein. However, thanks to a recent judgement from the District Court of The Hague, these parties’ ability to fight such practices has been strengthened.

Photo courtesy of Ms. Nyske Blokhuis.

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