What's in a Name? WIPO Domain Name Dispute Resolution Panellists' Meeting 28 Oct 2013

Every year at the end of October the World Intellectual Property Organization ("WIPO"), the UN agency for intellectual property holds a one day conference at its head office in Geneva for its domain name dispute resolution panellists. I have been a member of that panel for the last 10 years and I have attended every panellists' meeting since 2005. I have got to know quite a few of my fellow panellists over the years and several of them have become good friends. This year the conference took place on the 28 Oct.

In previous years the focus had been on practical issues arising under the Uniform Domain Name Dispute Resolution Policy ("UDRP") such as how to deal with privacy services and what constitutes evidence of registration and use in bad faith. There was some of that this year.  Andrew Lothian of Demys Ltd presented an analysis of the decisions where the domain name comprised the trade marks of more than one entity such as Dr. Ing. h.c. F. Porsche AG v. Automotive Parts Solutions WIPO Case No. D2003-0725 where the disputed domain name <911hyundai.com> was composed of trade marks belonging to Porsche and Hyundai. Richard Lyon and Adam Samuel spoke about drafting decisions and Scott Blackmer discussed "passive holding", that is to say parking a domain name on a holding page.

I must say that I found Scott's discussion particularly useful for such use is often the only evidence of registration and use in bad faith. The leading case on that point is Andrew Christie's decision in Telstra Corporation Limited v. Nuclear Marshmallows WIPO Case No. D2000-0003 where the panel said:

“the relevant issue is not whether the Respondent is undertaking a positive action in bad faith in relation to the domain name, but instead whether, in all the circumstances of the case, it can be said that the Respondent is acting in bad faith. The distinction between undertaking a positive action in bad faith and acting in bad faith may seem a rather fine distinction, but it is an important one. The significance of the distinction is that the concept of a domain name "being used in bad faith" is not limited to positive action; inaction is within the concept. That is to say, it is possible, in certain circumstances, for inactivity by the Respondent to amount to the domain name being used in bad faith.”

As I noted in "Dr. Martens" International Trading GmbH, “Dr. Maertens" Marketing GmbH v. Argo Blue LLC/ Domains By Proxy, LLC WIPO Case No. D2012-0209:

"Even though this passage has been quoted many times and endorsed by many distinguished panelists, this Panel has never been comfortable with it. It appears to substitute the concept of acting in bad faith for the very clear words of paragraph 4(a)(iii) of the Policy that require registration in bad faith and use in bad faith. The notion that “use” can somehow connote “inaction” on occasions has led to oxymorons such as “passive use” that could well have emanated from George Orwell’s Ministry of Truth."

The guidance that I draw from Nuclear Marshmallows is as follows:

"It is clear, however, from a careful reading of the Telstra case that the panel did not ignore the double probanda. On the contrary, in paragraphs 7.3 to 7.6 the panel restated the need to prove both registration in bad faith and use in bad faith. The real lesson from Telstra however is that though registration in bad faith and use in bad faith are separate probanda the same evidence can be used for both. In most cases, the evidential burden is discharged by proving one or more of the circumstances in paragraph 4(b) of the Policy. Where that is not possible the complainant has to satisfy the panel that the circumstances of the case are eiusdem generis those in that paragraph.

In the last sentence of paragraph 7.10 of Telstra the panel noted that the circumstances identified in paragraph 4(b) of the Policy are "without limitation" - that is, paragraph 4(b) of the Policy expressly recognizes that other circumstances can be evidence that a domain name was registered and is being used in bad faith. In the next paragraph the panel asked what those circumstances could be and concluded that the question could not be answered in the abstract but only in respect of the particular facts of a specific case."

And of course each case turns on its own facts.

Finally, David Bernstein discussed the relevance of the UDRP in other forums.  Having a personal and professional interest in bilateral investment treaties (see "Bilateral Investment Treaties: Claiming Compensation from Foreign Governments under Bilateral Investment Treaties for failing to provide adequate IP Protection"  27 July 2013) I was interested to learn that the US government had negotiated compliance the UDRP in several of its agreements.

Discussion on the UDRP ended at 11:20 and the rest of the day was devoted to dispute resolution in relation to the new generic top level domain names ("gTLD").  This was particularly timely in view of ICANN's announcement on the 23 Oct 2013 of the delegation of the first new gTLDs (see the ICANN press release "Internet Domain Name Expansion Now Underway"). For those who have not been following the story, ICANN (Internet Corporation for Assigned Names and Numbers the California not for profit corporation that oversees the Internet domain name system pursuant to a memorandum of understanding with the US government) has made elaborate arrangements for increasing the generic top level domain space from those ending in one of 22 suffixes (".com", ".org", ".net" ".biz", ".info" etc) to more or less any number. 

There has been a lot of hype about this expansion and I remember similar kerfuffles when ".biz", ".info" and ".pro" were announced in 2000 (see David Cohen "Magnificent Seven?" 17 Nov 2000 New Scientist) and later when the ".eu" TLD was trumpeted (Chris Morris "EU to launch its own web domain" 21 Apr 2005 BBC website). Whether we shall actually need all those new domain names in view of the new generation of apps that retrieve exactly the information we need which Andrew Christie pointed out on Monday remains to be seen.  This could be the biggest development in the internet since the launch of the worldwide web or it could be the dampest or damp squibs since the Thames jubilee pageant. 

For those who want to know more about this TLD expansion the bible is the "Applicants' Guidebook" which you can download in several languages from ICANN's new gTLD website.  ICANN intends to launch new gTLDs in phases and applications for the first phase opened on the 12 Jan 2012 and closed on 29 March 2012.  There have been quite a few applications - some 1,409 according to Blackknight's dotWhat.co website including 40 from the UK.  Although there have been applications from banks such as Barclays and HSBC, the luxury car makers Bentley, Jaguar and Landrover, fashion outlets Next and Lipsy as well as the BBC, ITV and The Guardian the opportunity to register a corporate name or trade mark as a TLD does not seem to have taken British industry by storm. Even the Cayman Islands, BVI and Gibraltar mustered more applications than the mother country (see "Number of applications per Country" dotWhat.co).

The most interesting statistic is the number of applications by company. Top of the list is the US start-up company Donuts Inc which has made 307 applications.  Next comes Charlston Road Registry on behalf of Goodgle with 101 and Amazon EU Sarl with 78. Donuts claims over US$100 million in VC and private equity funding and an experienced management team.  It will be instructive to analyse their business model once they are operating their domain spaces.

From a legal point of view the most interesting part of this expansion has been the resolution of disputes with existing trade mark proprietors and the rest of the speakers addressed that topic.  Andrew Christie and Ty Gray discussed the Legal Rights Objections filed with the WIPO Arbitration and Mediation Centre nearly all of which had been dismissed. Tony Willoughby outlined the other grounds of objection, namely string similarity and limited public interest and community objections.  Joanne Teng discussed the Trademark Clearinghouse which is supposed to make it easier for trade mark proprietors to register domain names during a "sunrise" or priority period, monitor adverse domain name registrations and launch Uniform Rapid Suspension ("URS") proceedings.  Nicholas Smith considered the URS which allows for the suspension but not transfer or cancellation of a domain name very quickly and at very low cost.  Joanne outlined the Post-Delegation Dispute Resolution Procedure ("PDDRP") which seems to be a very complex and expensive procedure.   Finally, Fred Abbott talked about the impact of the new gTLDs on the UDRP and Karen Fong and Matthew Harris suggested some trade mark strategies for the expanded domain name system.

Although the first phase of TLD expansion is over the Applicants' Guidebook promises more shortly.  It will be interesting to see whether there are any more and on what scale.   Also interesting will be how Donuts, Google and Amazon resolve any disputes that may arise in their domain spaces and what use, if any, is made of the URS, PDDRP and Trademark Clearinghouse.  If you are interested in any of those matters these chambers have more expertise than most when it comes to domain name dispute resolution with three members upon WIPO's arbitration, mediation and dispute resolution panels and our own domain name dispute resolution advisory and representation service. Call me on 020 7404 5252 during office hours or use my contact form. You can also tweet me, write on my wall or send me a message through G+, Linkedin or Xing.

Further Reading

New Generic Top Level Domains
Jane Lamber "London Pride: a Domain Name for Name for London" 4 Nov 2013 IP London
Mark Schweizer "New generic Top Level Domains – who registers them and why?" 13 Sep 2013 IPKat

Panellists Meetings
Jane Lambert "Needled in Geneva" 18 Oct 2005
Jane Lambert "Domain Names: 10 Years of UDRP" 10 Jan 2010

On the Tiles - the Court of Appeal's Judgment in Spear and Others v Zynga

S.1 (1) of the Trade Marks Act 1994, which implements art 2 of Directive 2008/95/EC of the European Parliament and the Council of 22 October 2008 to approximate the laws of the Member States relating to trade marks, defines a trade mark as "any sign capable of being represented graphically which is capable of distinguishing goods or services of one undertaking from those of other undertakings."  If you are new to trade mark law or wish to be refreshed on the basics take a decko at "Introduction to Trade Marks" in our IP South East blog of 9 Oct 2013.

As I mentioned in "The Colour Purple - Société Des Produits Nestlé S.A. v Cadbury UK Ltd." 4 Oct 2013 the above words have been considered by the Court of Justice of the European Union in Case C-104/01, Libertel Groep BV and Benelux-Merkenbureau [2004] Ch 83, [2004] 2 WLR 1081, [2003] EUECJ C-104/01, Case C-273/00 Sieckmann v. Deutsche Patent –und Markenamnt [2002] ECR 1-11754, Case C-49/02 Heidelberger Bauchemie GmbH v. Bundespatentgerich ECR 1-6129 and C-321/03 Dyson v. Registrar of Trade Marks ECR 1-687.  As Mr. Justice Arnold said at paragraph [11] of his judgment in  J W Spear & Sons Ltd and Others v Zynga, Inc [2012] EWHC 3345 (Ch) (28 Nov 2012):

"The case law of the Court of Justice of the European Union establishes that, in order to comply with Article 2, the subject matter of an application or registration must satisfy three conditions. First, it must be a sign. Secondly, that sign must be capable of being represented graphically. Thirdly, the sign must be capable of distinguishing the goods or services of one undertaking from those of other undertakings. See Case C-104/01 Libertel Groep BV v Benelux-Merkenbureau [2003] ECR I at [23], Case C-49/02 Heidelberger Bauchemie GmbH [2004] ECR I-6129 at [22] and Case C-321/03 Dyson v Registrar of Trade Marks [2007] ECR I-687 at [28]. It is clear that these conditions are cumulative.

The questions "What is a sign?", "What is meant by 'capable of being represented graphically'?" and "Is the sign capable of distinguishing the hoods or services of one undertaking from those of other undertakings?" which arose in Cadbury's attempt to register Pantone 2685C as a trade mark also arose in Spear and Others v Zynga.

J W Spear & Sons Ltd, which is a member of the Mattel group ("Mattel"), had registered the above sign as a trade mark for  "computer game adaptations of board games" in Class 9, "board games" in Class 28 and "organisation of competitions and exhibitions, all relating to board games" in Class 41 with effect from the 23 Dec 1997.   Zynga marketed a digital game that was called either SCRAMBLE or SCRAMBLE WITH FRIENDS. Mattel sued Zynga for infringement of the above trade mark.  Zynga counterclaimed for invalidation and applied for summary judgment on its counterclaim.  Giving judgment for Zynga, Mr. Justice Arnold concluded at paragraph [49] that the above trade mark did not satisfy the conditions of art 2 of the Directive and Mattel had no real prospect of successfully arguing to the contrary.

Mattel appealed and Lord Justice Lewison ordered the appeal to be heard with the appeal against Judge Birss QC's judgment in Société Des Produits Nestlé S.A. v Cadbury UK Ltd [2012] EWHC 2637 (Ch).   As some of the general points of the Court's judgment in Zynga were the same as in Cadbury the judgment in Zynga is quite short.

Dismissing the appeal Sir John Mummery said at paragraph [35] of his judgment in J W Spear & Son Ltd & Others v Zynga Inc [2013] EWCA Civ 1175 (04 October 2013) that "there was absolutely nothing wrong, either in law or in fact, with the judge's reasons, his conclusions, or his order" and that there was no advantage in further repetition of the reasoning contained in a judgment, which he would affirm without reservation.  Sir Timothy Lloyd and Lord Justice Lewison agreed.

As to that reasoning Mr. Justice Arnold had decided at paragraph [47] of his judgment that the above trade mark was not a sign because

"the Tile Mark covers an infinite number of permutations of different sizes, positions and combinations of letter and number on a tile. Furthermore, it does not specify the size of the tile. Nor is the colour precisely specified. In short, it covers a multitude of different appearances of tile. It thus amounts to an attempt to claim a perpetual monopoly on all conceivable ivory-coloured tile shapes which bear any letter and number combination on the top surface. In my view that is a mere property of the goods and not a sign. To uphold the registration would allow Mattel to obtain an unfair competitive advantage."

He decided at paragraph [48] that:

"Even if the Tile Mark complies with the first condition, in my judgment it does not comply with the second condition since the representation is not clear, precise, intelligible or objective. As discussed above, the representation covers a multitude of different combinations. It does not permit the average consumer to perceive any specific sign. Nor does it enable either the competent authorities or competitors to determine the scope of protection afforded to the proprietor, other than that it is very broad."

It appears from paragraph [31] of Sir John's judgment that Mattel's counsel did not argue with Mr Justice Arnold's analysis of the legislation or case law or the applicable principles and test for summary judgment. Mattel's complaint was that the judge misapplied the law stated by him to the facts found by him.

The Court of Appeal's judgment might have been more impressive had Sir John Mummery and the judges who agreed with him not confused revocation with invalidation. These are completely different concepts governed by different sections of the Trade Marks Act 1994: revocation by s.46 and invalidity by s.47. The counterclaim was for invalidation of the trade mark under s.47 (1) yet Sir John said at paragraph [2]:

"In the infringement proceedings Zynga counterclaims for revocation of the Tile Mark. On 26 October 2012 Zynga applied for summary judgment on the counterclaim."

If I had made a howler like that I would have had my knuckles rapped by the judge or hearing officer - and rightly so.

If you want to comment on this or the Cadbury appeal or trade mark law generally, call me on 020 7404 5252 during office hours or use my contact form.  You can also tweet me, write on my wall or send me a message through G+, Linkedin or Xing.

The Colour Purple - Société Des Produits Nestlé S.A. v Cadbury UK Ltd.

"The Color Purple" is a novel by Alice Walker which won its author the Pulitzer Prize for Fiction in 1983. if you have not read the book here is Wikipedia's summary of the plot.  It is a great book with a great story.

The colour purple (or rather pantone 2685C) is only slightly less gripping. It is the subject of a tussle between two of the world's largest confectionery companies the latest stage of which has just ended in the Court of Appeal ( Société Des Produits Nestlé S.A. v Cadbury UK Ltd. [2013] EWCA Civ 1174 (4 Oct 2013)).

It started on 15 Oct 2004 when Cadbury Limited (“Cadbury”) applied to register "the colour purple (Pantone 2685C), as shown on the form of application, applied to the whole visible surface, or being the predominant colour applied to the whole visible surface, of the packaging of the goods" as a trade mark for the following goods:

"Class 30: 

Chocolate in bar and tablet form, chocolate confectionery, chocolate assortments, cocoa-based beverages, preparations for cocoa-based beverages, chocolate-based beverages, preparations for chocolate-based beverages, chocolate cakes."

Now a trade mark has to be capable of distinguishing goods or services of one undertaking from those of other undertakings. S.3 (1) (b) of the Trade Marks Act 1994 excludes from registration trade marks which are devoid of any distinctive character. The examiner objected to the application on that ground.  However, section 3 (1) has a proviso that, a trade mark shall not be refused registration by virtue of paragraph (b), if, before the date of application for registration, it has in fact acquired a distinctive character as a result of the use made of it. Cadbury filed evidence of distinctiveness acquired through use and the examiner allowed the application to proceed.

When the application was published the Société des Produits Nestlé S.A. ("Nestles" as I still call it) decided to enter the fray. It filed a notice of opposition on 27 Aug 2008 contending:

"i) The mark is not capable of distinguishing the goods of one undertaking from those of others within the meaning of s.3 (1) (a) of the Act because it is just a single colour, and colours are commonly used in trade;
ii) Because the mark could take numerous forms of appearance, it is not a ‘sign’ within the meaning of s.3 (1) (a);
iii) The sign is not capable of being graphically represented as required by s.3 (1) (a);
iv) The mark is excluded from registration under section s.3 (1) (b), (c) and (d) because:

a) It is devoid of any distinctive character;
b) It designates a characteristic of the goods, namely the characteristic of having purple packaging;
c) It was customary in the current language or bona fide practices of the trade, the colour purple being in common use at the date of the application in relation to the specified goods;
d) It had not acquired a distinctive character through use.

v) To the extent that the mark covers the colour specified “applied to… the whole visible surface of the goods”, the application was made in bad faith contrary to s.3 (6) because the mark was not so used, and the applicant had no intention to use it like this.
vi) It was inconceivable that the applicant intended to use the mark in relation to the broad range of goods specified in the application, and the applicant must have known of others use of purple, so the application was made in bad faith for this reason too."

Cadbury filed a counter-statement denying the grounds of opposition.

The case came before Mr Allan James.  Taking the first three grounds together, Mr. James reformulated that part of Nestles's objection at paragraph [69] as follows.

"These grounds are that the mark is not:
i) A sign;
ii) Capable of being represented graphically;
iii) Capable of distinguishing the goods of one undertaking from those of others because it is a single colour."

Some of those issues had been considered by the European Court of Justice (as it was then called) in Case C-104/01, Libertel Groep BV and Benelux-Merkenbureau  [2004] Ch 83, [2004] 2 WLR 1081, [2003] EUECJ C-104/01.

On the question of whether a colour can be a sign, the Court reasoned at paragraph [27] that a colour per se cannot be presumed to constitute a sign because a colour is a simple property of things. However it may constitute a sign depending on the context in which the colour is used.  In particular, a colour is capable of constituting a sign in relation to a product or service.  At paragraph [71] Mr. James instructed himself that:

"It is clear from paragraph 27 of the judgment that colour may constitute a sign, but that it cannot be presumed to do so. Whether colour constitutes a sign depends on the context in which it is used. In some cases it may simply be a property of the goods. For example, brown is the natural colour of chocolate. In that case, the colour may not be a sign at all when used in relation to chocolate because it conveys no information apart from the product itself. In other cases the use of colour may be incidental, such as the colour of the shoes of a child shown eating a bar of chocolate in a picture appearing on the packaging of the product. Such incidental use of colour would not send any information to the consumer. Therefore it is not serving as a sign."

In Mr. James's view Cadbury's application was in effect an application for the registration of purple or predominately purple packaging and there was no doubt that coloured packaging could constitute a sign.

As to the second ground of objection as reformulated by Mr. James, the European Court had noted at paragraph [28] of Libertel that a graphic representation within the meaning of art 2 of Directive 89/104/EEC must enable the sign to be represented visually, particularly by means of images, lines or characters, so that it can be precisely identified.  It order to fulfil its function, the graphic representation must be clear, precise, self-contained, easily accessible, intelligible, durable and objective. A swatch of the colour by itself would not satisfy that requirement as colour samples fade over the years. Neither would a bare verbal description. However, "the designation of a colour using an internationally recognised identification code" could be enough.  In Mr. James's view Cadbury's application which consisted of a colour swatch, pantone number and description of its use met the requirement of graphical representation.  Nestles had argued that the addition of the words "being the predominant colour" had introduced an element of ambiguity.  Mr. James disagreed and rejected the second ground of objection.

Mr. James dealt shortly with the third ground of objection partly because it had already been decided by the Appointed Person in AD2000 [1997] RPC 168 and partly because it was better considered with paragraph (iv) of Nestles's notice of opposition.

Next, the hearing officer tackled the last two grounds of Nestles's objection. Nestles's counsel decided not to proceed with the sixth ground which was that Cadbury had no intention of ever using the mark for the "whole visible surface….of the packaging of the goods” as there would have to be space for the names of the product and manufacturer and other information.  Mr. James considered that it would be absurd to interpret the description literally and even if a strict literal translation were appropriate Cadbury's application fell a long way short of “…of the standards of acceptable commercial behaviour observed by reasonable and experienced men in the particular area being examined”, which amounts to bad faith.

Finally, Mr. James addressed the want of distinctive character point that had been raised by the examiner. The European Court had provided some guidance on the point in Libertel which the hearing officer summarized at paragraph [99] as follows:

"i) I should remember that the public’s perception of the use of a colour is not necessarily the same as it would be with a traditional word mark.
ii) However, the method of assessment of whether the mark had acquired a distinctive character remains the same, therefore:

a) The length of time and the extent of the use of the mark should be taken into account, as well as the amount spent promoting it (as a mark);
b) If a significant proportion of the relevant public have been shown to identify the goods as originating from a particular undertaking because of the trade mark, I must find that the mark had acquired a distinctive character;
c) In assessing whether the mark is distinctive as per (b) above, I may take account of statements from the trade and the results of public surveys."

In Libertel the Court had also held that the public interest should be kept in mind when deciding cases of this kind.  At the hearing Mr James had heard a lot of evidence on Cadbury's use of purple packaging including survey evidence. He did not think that there was any doubt on the evidence that there is an association of some kind in the public’s mind between the colour applied for and Cadbury. However, the question he had to address was not simply whether the colour was distinctive of the company, but whether it was distinctive of its goods, and if so, which goods.He therefore assessed the matter in relation to each of the descriptions of goods in the application.  Taking all the evidence into account, he found that the mark had acquired a distinctive character in the required sense, by the relevant date, in relation to chocolate in bar and tablet form, chocolate assortments and drinking chocolate but not chocolate confectionery at large or chocolate cakes. He therefore held that the mark should be registered for:

"Chocolate in bar and tablet form; chocolate for eating; drinking chocolate; preparations for making drinking chocolate."

As Nestles had successfully narrowed the range of specified goods, Mr. James decided to award Cadbury's only 75% of their costs on the scale set out in Tribunal Practice Notices 2/2000 and 4/2007.

Nestles appealed to the High Court on the ground that the mark applied for was "not a sign capable of being represented graphically and as such is not registerable as a trade mark" and also on the implied inclusion of plain chocolate within the specification and the description of eating chocolate.  Cadbury cross appealed for its costs.  The appeal came before His Honour Judge Birss QC as he then was in Société Des Produits Nestlé S.A. v Cadbury UK Ltd   [2012] EWHC 2637 (Ch). His Honour rejected Nestles's s.3 (1) (a) point but allowed its appeal on the specification on the basis that all the evidence of use adduced before the hearing officer related only to milk chocolate. He inserted the adjective "milk" before chocolate so that the specification read

"Milk chocolate in bar and tablet form; milk chocolate for eating; drinking chocolate; preparations for making drinking chocolate.

Nestles appealed to the Court of Appeal in on the ground that the judge made errors in relation to the requirements that a trade mark be "a sign" and that it be "graphically represented." Alternatively, Nestles submitted that, if the issues on the interpretation of the Directive were not acte clair in Nestles's favour, they should be the subject of a reference to the Court of Justice of the European Union under art 267 of the Treaty for the Functioning of the European Union.

At paragraphs [20] and [21] of his judgment, Judge Birss QC had observed:

"20. Before getting into the decided cases it may be noted that the potential problems arising from applications of this kind are not hard to see. Conventional trade marks such as trade names ("Cadbury") or logos (such as a glass and a half of milk on a bar of Cadbury's Dairy Milk) do not give rise to the same conceptual problems as what have been called "exotic" trade marks such as smells, colours per se and other things. The attraction of a trade mark registration is that provided it is used and the fees are paid, it gives a perpetual monopoly. The problem is the same as the attraction but from the other perspective. Unless the registration of trade marks is kept firmly in its proper sphere, it is capable of creating perpetual unjustified monopolies in areas it should not. This is not a new problem. In his judgment in British Sugar v James Robertson [1996] RPC 281, which related to whether the word "treat" was a valid trade mark Jacob J (as he then was) started his judgment with the well known passage from the judgment of Cozens-Hardy MR in 1909:

'Wealthy traders are habitually eager to enclose part of the great common of the English language and to exclude the general public of the present day and of the future from access to the enclosure.'

21. What was said a century ago about the great common of the English language might be said today about the world's great common of the visible electromagnetic spectrum. In that sense the case before me is really very simple. Can Cadbury, even if they have shown that the public associate the colour purple with Cadbury's chocolate, obtain a trade mark registration for that colour per se?" 

 In his judgment Sir John Mummery endorsed that observation at paragraph [13]:

"The judge recognised that unconventional or "exotic" marks, such as colours, sounds and smells, give rise to conceptual problems, which are not encountered with more conventional trade names and logos. As the registration of a trade mark creates a form of intellectual property conferring a potentially perpetual monopoly in the mark and excluding everybody else from use in various ways, the point of principle has some public importance."

Like the judge and indeed Mr. James, Sir John reviewed the case law, namely Libertel,  Case C-273/00 Sieckmann v. Deutsche Patent –und Markenamnt [2002] ECR 1-11754, Case C-49/02 Heidelberger Bauchemie GmbH v. Bundespatentgerich  ECR 1-6129 and  C-321/03 Dyson v. Registrar of Trade Marks ECR 1-687. From those cases he distilled the following principles at paragraph [15]:

"The conditions

(1) An application to register a trade mark must satisfy three conditions for the purposes of Article 2:-

(i) there must be a sign;
(ii) it must be capable of graphical representation;
(iii) it must be capable of distinguishing the goods or services of one undertaking from those of other undertakings.

Purpose

2) The purpose of the requirements is to prevent abuse of trade mark law in order to obtain an unfair competitive advantage.

Identification

(3) Identification requirements for entry of a trade mark on the public register of trade marks include clarity, intelligibility, specificity, precision, accessibility, uniformity, self-containment and objectivity.

Multitude of forms

(4) The identification requirements are not satisfied, if the mark could take on a multitude of different appearances, which would create problems for registration of the mark and give an unfair competitive advantage over competitors.

Colour without a message

(5) Colours are normally a simple property of things, or a means of decorating things. They are not normally capable of being a sign. A sign conveys a message. The sign is capable of being registered as a trade mark, if the message is about the source of goods or services.

Colour as a sign conveying a message

(6) Depending on the facts and circumstances of the case, colours, or combinations of colours, designated in the abstract and without contours and used in relation to a product or service are capable of being "a sign."

Graphic representation of colour

(7) As for the second condition of graphical representation, in a mark consisting of two or more colours designated in the abstract and without contours, qualities of precision and uniformity are required. The colours must be arranged by associating them in a predetermined and uniform way.

Colour without form/in a multitude of forms

(8) Those requirements are not met by the mere juxtaposition of colours without shape or contours, or by reference to colours in every conceivable form, so that the consumer would not be able to recall or repeat with certainty the experience of a purchase. The scope of protection afforded by such a mark would be unknown both to the competent authorities responsible for maintaining the register and to economic competitors. Registration would confer unfair competitive advantages on the proprietor of the mark."

Sir John held that both the judge and hearing officer had erred in their interpretation of the verbal description of the graphical representation of the mark for which the application was made. The problem was that the description referred not only to the colour purple as applied to the whole visible surface of the packaging of the goods, but also to the alternative "predominant colour applied to the whole visible surface..." The use of the word "predominant", in Sir John's view, opened the door to a multitude of different visual forms as a result of its implied reference to other colours and other visual material not displayed or described in the application and over which the colour purple might predominate. That made it into an application for the registration of a shade of colour "plus" other material and not of just of an unchanging application of a single colour, as in Libertel. Accordingly. the colour could not constitute a sign for the purposes of art 2 of the Directive or indeed s.1 of the Act. Were it otherwise

"The result would not be an application to register "a sign", in the accepted sense of a single sign conveying a message, but to register multiple signs with different permutations, presentations and appearances, which are neither graphically represented nor described with any certainty or precision, or at all."

He concluded at paragraph [52]:

"The appearance and number of such other signs would be unknown both to the Registrar, who is responsible for the proper functioning of the registration system and is faced with the decision whether or not to register it on a public register, and to competitors, who would not be able to tell from inspecting the register the full scope and extent of the registration. To allow a registration so lacking in specificity, clarity and precision of visual appearance would offend against the principle of certainty. It would also offend against the principle of fairness by giving a competitive advantage to Cadbury and by putting Nestlé and its other competitors at a disadvantage."

Sir Timothy Lloyd and Lord Justice Lewison delivered concurring judgments. The Court of Appeal did not see the need for a preliminary reference to the CJEU.

So where does this leave colour marks? Not entirely unregisterable, I think. but the application has to be drafted with very great care.  Had Cadbury applied simply to register wrapping foil in pantone 2658C it is hard to see how there could have been a problem. There would not have been a problem had Cadury's applied to register the outer packaging of each of its products though it is hard to see the commercial point of doing so as there us adequate protection for such products word marks and glass and half devices and other logos already. This appeal was decided on public policy grounds and that is probably not a bad thing.

Passing off - Fenty v Topshop

Topshop, Oxford Circus   Source Wikipedia

Mr. Justice Birss summarized the issues in Fenty and Others v Arcadia Group Brands Ltd (t/a Topshop) and Another  [2013] EWHC 2310 (Ch), [2013] WLR(D) 310 admirably in paragraph [1] of his judgment in that case:

"Topshop is a well known fashion retailer. Rihanna is a famous pop star. In March 2012 Topshop started selling a t-shirt with an image of Rihanna on it. The image was a photograph taken by an independent photographer. Topshop had a licence from the photographer but no licence from Rihanna. Rihanna contends that the sale of this t-shirt without her permission infringes her rights. Topshop does not agree. This action is the result."

In the next paragraph his lordship stressed that this case was not concerned with so called "image rights":

"Whatever may be the position elsewhere in the world, and how ever much various celebrities may wish there were, there is today in England no such thing as a free standing general right by a famous person (or anyone else) to control the reproduction of their image (Douglas v Hello [2007] UKHL 21). There is a developing law of privacy but no question of that arises in this case. The taking of the photograph is not suggested to have breached Rihanna's privacy. A celebrity may control the distribution of particular images in which they own the copyright but that right is specific to the particular photographs in question. Whether an image right can or should be developed is not what this case is concerned with."

This was an action  for passing off the probanda for which are as follows:

"[Rihanna] must show that she has a goodwill and reputation amongst relevant members of the public; the conduct complained of must be shown to make a misrepresentation, i.e. to be likely to deceive those members of the public into buying the product because they think it is authorised by her; and that misrepresentation must cause damage to her goodwill. If these elements are established, Rihanna has a good claim against Topshop. If they are not, Rihanna has no ground in law to object to the sale of her image on the t-shirt. That is what this case is about."

Relying on the decision of Mr Justice Laddie in Edmund Irvine Tidswell Ltd. v Talksport Ltd  [2002] EMLR 32, [2002] WLR 2355, [2002] 2 All ER 414, (2002) 25(6) IPD 25039, [2002] 1 WLR 2355, [2002] FSR 60, [2002] EWHC 367 (Ch), [2002] EWHC 367 the judge set out the applicable legal principles:

"The claimant must have a goodwill to protect. If goods are then sold in circumstances in which the purchasers understand there to be a representation that the goods are authorised by the claimant or are in that sense "official" merchandise, but in fact that representation is a false one, then as long as the false representation is operative, the second element of passing off will be satisfied. To complete the tort the activity has to be damaging, but in a case like this, if the first two elements are proved, it most likely will be."

The judge emphasized that a critical problem in cases of this kind is to distinguish between two different reasons why a person might be moved to buy the product in question. As he explained at paragraph [35]:

"If when they buy the t-shirt, they simply wish to buy an image of the pop star, then no misrepresentation has taken place. Merely recognising that the image is an image of the celebrity can never be sufficient to make the claimant's case. For passing off to succeed there must be a misrepresentation about trade origin."

The reason why this distinction is important is that selling a garment with a recognizable image of a famous person is not, in and of itself, passing off. To be passing off, a false belief engendered in the mind of the potential purchaser must play a part in his or her decision to buy the product.

Mr Justice Birss described Rihanna as "a world famous pop star" with "a cool, edgy image." He held that "she was and is regarded as a style icon by many people, predominantly young females aged between about 13 and 30." He explained that such people are interested in what they perceive to be Rihanna's views about style and fashion. Thus, if Rihanna is seen to wear or approve of an item of clothing, that is an endorsement of that item in the mind of those people which, in his lordship's view, was enough to succeed in an action for passing off.  Her goodwill was not only as a music artist but also in the world of fashion, as a style leader.  In reaching his decision the judge appears to have noted that Rihanna had actually designed clothes for River Island.

As the judge remarked at paragraph [47], misrepresentation was the real issue in this case.  There was evidence before the court that Topshop had marketed itself as a place where celebrities did their shopping. Once when Rihanna visited its Oxford Circus store, Topshop tweeted:

"Ridiculously excited! @Rihanna is in our Oxford Circus store as we tweet. Ah, wonder what she'll buy…"

The consequence was that prospective purchasers would look at the t-shirt on sale in Topshop and conclude that that garment had been authorized by her.  For those persons the idea that it is authorized will be part of what motivates them to buy the product. The judge was quite satisfied that many fans of Rihanna regarded her endorsement as important.

"She is their style icon. Many will buy a product because they think she has approved of it. Others will wish to buy it because of the value of the perceived authorisation itself. In both cases they will have been deceived."

As for damage, the judge concluded that the claimants would lose sales and suffer damage to their goodwill.

Thus, all three elements of an action for passing off were established and the claim succeeded.

I have to say that I was very surprised by the result. I first learned of the case before the trial was over from one of the counsel in the case at the IP Bar garden party and I was very sceptical as to the cause of action although, of course, I kept my opinions to myself at the time.  I instinctively sided with Topshop whose case was set out by Mr. Justice Birss at paragraph [47]:

"Topshop's case is simple. The item is a t-shirt bearing a large image of Rihanna on it. Customers buy it because they like the product and the image for their own qualities. No doubt in many cases they will like Rihanna. There was at the time a trend for image t-shirts. There is nothing on the t-shirt which represents it is an item of official Rihanna merchandise and customers do not think it is. It is a high quality fashion led garment, a "boyfriend style tank" (i.e. an oversized sleeveless t-shirt). The image has been printed using sublimation rather than screen printing, an expensive process which enhances its high quality nature. That is very different from standard pop star merchandise. Nothing on the swing tag or other labelling makes any suggestion it is a Rihanna authorised garment. There is no R slash logo. Topshop sell many garments like this. The public has no expectation that the garments are authorised by the person shown in the image."

I think a lot of judges would have agreed with that argument especially as there are authorities like Kojak (Tavener Rutledge v Trexapalm [1977] RPC 275), Abba (Lyngstad v Anabas  [1977] FSR 62) and Wombles (Wombles v Womble Skip Hire [1975] FSR 488) which have been distinguished but are still good law. However, the fact that I was surprised does not mean that I think the decision was wrong.  On the contrary, having read the trial judge's reasoning at least 6 times I now see where he was coming from and actually think I agree with him.

What this case goes to show is that every passing off claim turns on its own facts and the special facts of this case seem to be that Rihanna was no mere clothes horse with a voice but a fashion authority (indeed a designer among other things) and that Topshop had gone out of its way to show a connection with Rihanna. Yet another salutary warning that one should be very careful about what one tweets about.   I don't think that the facts upon which this case turned will occur very often. I also think that in most merchandising and endorsement cases the Topshop argument will succeed.

I will discuss this case among other things in my talk on "Branding - Trade Marks, Passing off, Domain Names, Geographical Indications" on 25 Sept 2013 which is now fully booked.  You can put your name down on our waiting list and I will post the slides and notes to Slideshare. I will probably also give the talk again in the North if someone wants to host me there.  In the meantime, if anyone wants to discuss this case or passing off in general give me a ring on 020 7404 5252 or fill in my contact form. You can also tweet me, write on my wall or send me a message through G+, Linkedin or Xing.

Robert Furneaux of Sipara writes:

"i was reading your review on the case but cant seem to post a comment! my problem with the case is around the finding of misrepresentation. i am no fashion afficiendo but my sense is that few fashion icons produce collections containing pretty basic t-shirts with photos of themselves on. indeed the River Island collection by Rhianna contains nothing like it. i just dont think TS customers would be confused in that way... hope there's an appeal!"

Unified Patent Court Comes One Step Closer

When I was called to the Bar in 1977 I spent a lot of time studying the Community Patent Convention which of 1975 because I really thought I would need to know about it. Hélas le temps perdu!. I would have spent the time no less profitably in the Seven Stars.  Forty years on, as they sing at Harrow, there are signs that something close to the original concept of the Community patent is about to become a reality.

On 17 Dec 2012 the Council of Europe and the European Parliament adopted two short regulations:

Regulation (EU) No 1257/2012 of the European Parliament and the Council of 17 December 2012 implementing enhanced cooperation in the area of the creation of unitary patent protection; and

Regulation (EU) No 1260/2012 of 17 December 2012 implementing enhanced cooperation in the area of the creation of unitary patent protection with regard to the applicable translation arrangements.

These regulations do not establish a Community or EU patent as such but they do provide the very next best thing, namely a "European patent with unitary effect".   

"What's a European patent with unitary effect?" I hear somebody ask from the back of the class? Well it is a European patent - that is to say a patent granted by the European Patent Office in Munich - which is granted with for all the EU member states except Croatia, Italy, Poland and Spain.   Art 3 (1) of Reg 1257/2012 specifies two conditions for such a patent.   The first is that it must have the same set of claims in respect of all the participating member states.  The second is that it must have been registered in the Register for unitary patent protection.

The implementation of Regulation 1257/2012 was dependent on the establishment of a patents court for the participating member states.   One of reasons why we do not already have a European Union or Community patent is that member states have been unable to agree on a mechanism for resolving disputes over European patents.   The difficulty is that the judges in some states have more experience of patent litigation than others and that litigation in common law jurisdictions is (or at least was until the new Patents County Court rules were introduced) considerably more expensive than in civil law countries.  A solution has been provided by the Agreement on a Unified Patent Court which was signed by all the EU member states except Spain and Poland including Italy which is not one of the states participating in the European patent with unitary effect.

The Agreement establishes a Unified Patent Court for the participating states consisting of a Court of Appeal, Court of First Instance and a Registry.   The Court of First Instance will be based in Paris with sections in London and Munich. The London section will hear cases involving chemical and pharmaceutical patents whereas Munich will handle mechanical patent cases and Paris just abut everything else. The Court f Appeal will be in Luxembourg.   The Court is likely to sit in other national and perhaps regional divisions so maybe we shall see a division of the Unified Patent Court in my beloved Manchester one day.  "Aye happen", as we Mancunians say. 

The agreement which annexes the Court's statute sets out the basic rules but these will be supplemented by Rules of Procedure which are already n their 15th draft.  Right now there is a consultation on these draft rules that have been drafted by a committee chaired by Kevin Mooney of Simmons & Simmons. The committee's members include Lord Justice Floyd together with 2 members each from France and Germany and one from the Netherlands. Right now there is a consultation on those rules - which are very long - some 382 at present - and responses have to be directed to secretariat@unified-patent-court.org by 1 Oct 2013.

Drafting rules of procedure is only one of a whole raft of tasks to be undertaken before the new court takes off. Others include finance, IT, facilities and training.   A preparatory committee consisting of representatives of all the participating states has been formed and they have adopted a road map or programme of work for the next two years or so.  All this and bags of other useful information can be downloaded from the Unified Patent Courts very own website at http://www.unified-patent-court.org/.

If you want to know more about the Unified Patents Court I shall certainly be writing lots of articles and giving lots of lectures.  If you have a specific enquiry call me on 020 7404 5252 or send me a message through my contact form.  As with everything else I can be contacted through twitter, Facebook, G+, Linkedin and Xing.   

In the meantime there are two good videos from the European Patent Office you may want to watch:

• Stefan Luginbuehl on "Unified Patent Protection and Unified Patent Court"; and
• a mock trial relating to a patent for a folding attic stairway before Professor Sir Robin Jacob.

If you want to learn the sorry saga of the Community or EU patent I can think of no better place to start than Axel Horns "A Unified European Patent System - the Historical Perspective" 18 Feb 2010 IP Jur.   

Have a good weekend chaps!

Bilateral Investment Treaties: Claiming Compensation from Foreign Governments under Bilateral Investment Treaties for failing to provide adequate IP Protection

In Novopharm Ltd v. Eli Lilly & Co 2010 FC 915 Mr. Justice Barnes of the Federal Court of Canada declared that Canadian patent no. 2,209,735 for the second medical use of the drug atomoxetine to treat attention deficit hyperactivity disorder in adults was invalid for inutility. His judgment was upheld by the Federal Court of Appeal in Eli Lilly & Co. v. Teva Canada Ltd 2011 FCA 220. Eli Lilly & Co. applied for leave to appeal to the Canadian Supreme Court but that was refused on 8 Dec 2012.

Similarly, in Eli Lilly Canada Inc. and Others v Novopharm Ltd 2011 FC 1288 Mr. Justice O'Reilly threw out Eli Lilly's claim against Novopharm for infringement of its Canadian patent no. 2,041,113 for olanzapine on the ground of invalidity. Again, Eli Lilly appealed but the Federal Court of Appeal upheld the court below in Eli Lilly Canada Inc v Novopharm Limited, 2012 FCA 232. Again, Eli Lilly sought leave to appeal to the Supreme Court and, again, it was refused.

End of story one might think.

Well possibly not because Eli Lilly served on the 13 June 213 a notice of intent to claim C$500 million damages from the Canadian government for the loss and damage that it claims to have sustained from the invalidation of its patents by the courts of Canada.

Canada, the United States and Mexico are party to an agreement to set up the North American free trade area known as "NAFTA". Chapter 11 of NAFTA requires each party to that agreement to respect investments in their territories by the nationals of the other.   

Art 1102 (1), for instance, requires each party to 

"accord to investors of another Party treatment no less favorable than that it accords, in like circumstances, to its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments."

Art 1105 (1) further requires parties to

"accord to investments of investors of another Party treatment in accordance with international law, including fair and equitable treatment and full protection and security."

 Finally, art 1110 (1) protects investors from appropriation of their investments:

"No Party may directly or indirectly nationalize or expropriate an investment o f an investor of another Party in its territory or take a measure tantamount to nationalization or expropriation of such an investment ("expropriation"), except:
(a) for a public purpose;
(b) on a non-discriminatory basis;
(c) in accordance with due process of law and Article 1105(1); and
(d) on payment of compensation in accordance with paragraphs 2 through 6."

The term "investment" is defined very broadly by art 1139 NAFTA and specifically includes

"(g) real estate or other property, tangible or intangible, acquired in the expectation or used for the purpose of economic benefit or other business purposes;"

Art 1116 (1) of  NAFTA enables an investor of any of the parties to the agreement to submit to arbitration a claim that another party to the agreement has breached an obligation under the agreement whereby the investor has incurred loss or damage.   The first step is for the aggrieved investor to serve notice of intent to submit a claim to arbitration under art 1119 at least 90 days before the submission of the claim.   If the dispute is not resolved within that time the complainant can institute proceedings in ICSID ("the International Centre for the Settlement of Investment Disputes"), an adjunct of the World Bank in Washington.

Eli Lilly claims that the invalidation of its patents by the Canadian courts amounts to expropriation of its investment in Canada:

"Through the measures in issue, Canada has directly expropriated Lilly's exclusive rights conferred by the the Strattera and Zyprexa patents. Canada took away these rights with respect to Strattera on September 14, 2010 and with respect to Zyprexa on November 10, 2011. The effect of the measures was to void the patents ab initio, thereby depriving Lilly of its exclusive rights to prevent third parties from making, using or selling its patented products during the patent term or to enforce those rights. In the alternative, Canada has indirectly expropriated Lilly's exclusive rights conferred by the Strattera and Zyprexa patents through the measures in issue. The foremost consideration when an indirect expropriation is alleged is the effect of the measures complained of and whether they have deprived the investor of substantially all of the value of its investment. The measures in issue have had the effect of destroying the value associated with Lilly's investments, namely, the exclusive rights to prevent third parties from making, using or selling the patented product during the patent term and to enforce those rights."

The company also contends that the Canadian government has infringed other provisions of Chapter 11 including arts 1102 and 1105 as well as an obligation under art 1709 NAFTA to

"make patents available for any inventions, whether products or processes, in all fields of technology, provided that such inventions a re new, result from an inventive step and are capable of industrial application. For purposes of this Article, a Party may deem the terms "inventive step" and "capable of industrial application" to be synonymous with the terms "non-obvious" and "useful", respectively."

As a result of those alleged breaches, Eli Lilly claims to have suffered losses of at east 500 million loonies.

Now the basis of the claim is that the Canadian courts have developed a doctrine whereby the utility of a pharmaceutical invention is judged by reference to the promise made in the specification.   Eli Lilly contends that this doctrine, which is known as "the promise doctrine", exists nowhere else in the world and results in the invalidation of patents that would be allowed elsewhere.   It says that the Canadian courts had no business to develop doctrines at variance with US and European patent law, that if the courts of Canada don't see the error of their ways then the Parliament of Canada should change the law and, in the meantime, the Canadian taxpayer should pay Eli Lilly C$500 million at the very least.

If this sounds like chutzpah then remember that this case is the latest in a spate of claims by private companies against sovereign governments that followed a claim by the US waste disposal company Metalclad Insulation Corp.against the Mexican government for compensation for the refusal of the state and local governments to grant planning permission to use a landfill site that Metalclad had acquired in the small town of Guadalcázar, San Luis Potosi for the disposal of toxic waste.  Metalclad's claim was based on the same provisions of NAFTA as Eli Lilly's.  In the arbitration, the tribunal which consisted of Professor Sir Elihu Lauterpacht, QC, CBE, Mr Benjamin R. Civiletti and Mr José Luis Siqueiros sitting in Vancouver, British Columbia held at paragraph [101] of its award of 30 Aug 2000 that Metalclad had not been treated fairly or equitably under NAFTA and succeeded on its claim under art 1105.and at paragraph [112] that Mexico had indirectly expropriated Metalclad’s investment without providing compensation to Metalclad for the expropriation and had thereby violated art 1110.  The arbitrators awarded Metalclad damages of US$16,685,000.  The award was reduced slightly on appeal to the British Columbia courts but generally the result was seen as a success for the comparatively little chap against foreign governments.

"What's all that got to do with us?" I hear you say. "We are not yet part of NAFTA though there have been calls by politicians and journalists on both sides of the Atlantic for us to join it (see, for example, Ian Murray and James Bennett "Britain's Future Lies With America, Not Europe" 29 Dec 2011, Wall Street Journal).  However, we do have bilateral investment treaties ("BITs") with 102 governments around the world and each of those agreements contains provisions that are very similar to those of Chapter 11 of NAFTA. Many of those agreements are with countries that supply clothing, electronic gizmos and all sorts of other goodies to Western consumers.   A complaint that I often hear from small and medium enterprises ("SME") in this country is that they subcontract the manufacture of their product to South East Asia only to find unlicensed copies flooding back to them because nobody in those countries respects foreigners' (or at least their) IP.  Furthermore they add, there doesn't seem to be anything anybody can do about.

Well maybe now there is. If the refusal of planning permission by the council of a little town in Mexico  and the invalidation of a US company's Canadian patent amounts to expropriation then surely it can be argued with equal force that the failure to provide a proper remedy to a British company for the infringement of its IP rights amounts to expropriation of that company's rights.  If the local legislation is inadequate, if IP infringement proceedings are slow, uncertain or expensive, if officials are corrupt then maybe you should claim compensation from the government of the country concerned through arbitration in ICSID.

Main Street, Salinas California  Source Wikipedia

For the SME a claim in ICSID is nothing like as daunting as might be supposed.   Metalclad was
represented very effectively not by well known Wall Street or Los Angeles attorneys but by a Mr. Clyde C Pearce who practises on his own account in Salinas which is a town that is about the same size as Huddersfield.

If you want to know more about the topic I have developed my ideas in an article which I have just submitted to the EIPR for publication and I have just had a very nice email back from Hugh Brett which suggests that it will be accepted.   I shall also try to catalogue as many materials about the Eli Lilly claim and other materials on IP claims relating to BITs and NAFTA as possible.  You can give me a ring on 020 7404 5252 during office hours, fill out my contact form, send me a tweet, write on my wall or send me a message through G+, Linkedin or Xing.

Further Reading
Jane Lambert  "The UAE's Bilateral Investment Treaties" 28 July 2013 NIPC-Gulf
Jane Lambert  "Claims against States: Czech Republic v European Media Ventures SA" 9 Dec 2007

IP Bar Association Garden Party

Prof. Tanya Aplin

I have been a fan of Professor Tanya Aplin for some time, originally because of her transformation of Gurry on Breach of Confidence and more recently because of her part in the Submission to the UK IPO on the issue of criminal sanctions for the deliberate copying of designs by Sir Robin Jacob and the Professors of IP law at the Universities of Oxford, Cambridge, Glasgow, Edinburgh and Bournemouth. Like Francis Gurry, the Director-General of the WIPO, she is an Australian which is almost a qualification in itself as the courts of that island continent are a laboratory for the development of the common law positively fizzing with bright ideas some good and others not so good.

Professor Aplin was guest of honour at the Intellectual Property Bar Association garden party on Monday which I attended with Robert Griffiths QC, the IPBA's latest recruit, and our pupil Nicola Strachan. Before we could taste our pudding metaphorically speaking we had to eat our greens. In other words we had to listen to a talk before we could go to the party. But this talk by Professor Aplin was the educational equivalent of broccoli, courgettes and okra rather than limp lettuce and institutional cabbage.  We were treated to a swipe at a notion that is even more misguided than clause 13 of the Intellectual Property Bill, namely the motions in the bowels of the Commission towards a directive on harmonizing trade secrets law.

The Professor sought to persuade us that such a directive was a bad idea.   I don't think many of us needed much persuasion but then what do our opinions matter? Over drinks and canapes in the gardens of Gray's Inn I discussed the Intellectual Property Bill and in particular clause 13 with several colleagues. Not a single member of the IP bar had a kind word for the proposal. Apparently we like the judges, the International Chamber of Commerce, the IP Federation and the professors of our oldest universities made submissions against criminalizing registered design infringement only to be told that ours is a minority view.  If that is the case, who constitutes the majority?  Is it merely a head count of the subscribers to ACID? One eminent silk with excellent political collections and sensitive antennae pinned the blame on Cable.  I do hope that is not the case because I have long been an admirer of the Business Secretary with whom I have much in common. He has already been demonized (not altogether fairly) for his part in the student fees fiasco and his indiscretions to journalists over Rupert Murdoch. It would be regrettable if he were remembered for piloting into law the IP equivalent of the Dangerous Dogs Act.

Anyway back to the talk, there have been two reports on trade secrets law in the EU:

• Report on Trade Secrets for the European Commission by Hogan Lovells International LLP; and
• Baker & Mackenzie's Study on Trade Secrets and Confidential Business Information in the Internal Market.

There was also a conference on trade secrets in Brussels just over a year ago and a public consultation on the protection of business and research know-how which took place between the 11 Dec 212 and 8 March 2013. I am really grateful to Professor Aplin for bringing this research to our attention because I suspect that the first we would have heard of  it otherwise would have been a statutory instrument under s.2 of the European Communities Act 1972 when it would have been far too late to do anything about it.

A quick read of the executive summaries of the two reports shows why the whole notion of a harmonizing

Source Wikipedia

directive is barking. There is some sort of protection for trade secrets in each of the member states (and indeed there has to be because we are each obliged by our membership of the World Trade Organization to protect "undisclosed information" by art 39 of TRIPs as I pointed out in my question) but each member state provides that protection in a different way. Most states do so under a general unfair competition law whereas we and the Irish rely on the law of confidence. Sweden has a trade secrets statute.  In most countries using or disclosing trade secrets is a criminal offence. There is also protection in some countries under labour law.  If it has taken my whole professional life time to get to the point where we appear to be about to get a single European patent for most but by no means all of the territories of the member states of the EU when we are already party to the European Patent and Paris Conventions, getting agreement on harmonizing trade secrets law will be next to impossible.

Even if we do get agreement on such harmonization will it actually do us any good?   I have heard clients moan about inadequate design and trade mark protection in some countries of the world - mainly outside Europe - but I have never heard any complaints about Germans nicking the best British technology or of Italians trousering British designs. The reason for that is that you don't really need any law to protect trade

A shot of Chartreuse Wikipedia

secrets (or if you do it is too late because the secret is out). What you need are good levels of security.  After all the Carthusian monks have managed to keep the recipe of chartreuse a secret since 1764 through good security measures though doubtless they have the sanction of eternal damnation should their secret ever be leaked. As I said in my talk to the Leeds Inventors Club in "All you need to know about confidentiality" some seven years ago you need to monitor and police individual disclosures rather than rely on confidentiality agreements and courts when things go wrong.

Finally the harmonization that we have had in such areas as database protection and trade mark law has not exactly been a howling success.   Professor Aplin described the arguments in favour of harmonizing trade secrets law as "myths" and I think she is right.  But if any of you take a contrary view or want to discuss this article or topic give me a ring on 020 7404 5252, fill out my contact form, send me a tweet, write on my wall or say something rude (or nice) about me on G+, Linkedin or Xing..