18 September 2014

IP concerns everyone - not just elite lawyers and big business

 On 18 Sept 2008 I wrote in IP Yorkshire:
"Team GB may have done very well at the Beijing Olympics but our inventors and entrepreneurs are nothing like as successful in the European patent application stakes. As can be seen from the ..... table [in the article], we trail a poor 7th in the number of European patent applications. Not only do we lag behind the economic super-powers, the USA and Japan, but we compare badly even to France and Germany with similar populations and GDP. We even trail the Netherlands and Switzerland with a third and an eighth of our population respectively and are about to be overtaken by distant South Korea which was a battlefield 50 years ago."
 I considered why the UK does so badly and found that it was because "start-ups and other small businesses, that are the mainspring of innovation in the UK as in most of our competitors, make much less use of the intellectual property system than their equivalents in other countries and, indeed, much less use than multinational enterprises and other big businesses here." I concluded that there were two reasons for that:
"One is that the cost of obtaining and enforcing legal protection for investment in brands, design, technology and the creative works is prohibitive and the other is that the intellectual property services available to small businesses, particularly outside London, is patchy in quality and, when compared to the unit costs that major companies pay, relatively expensive."
Both Gowers and Hargreaves came to similar conclusions in their reviews.

By launching IPEC (Intellectual Property Enterprise Court) with its small claims track and acceding to and implementing the Unified Patent Court Agreement the government has done something about the first problem. Through its outreach programme the Intellectual Property Office is doing what it can in collaboration with the local enterprise partnerships and the Business and IP Centres at the British Library and Birmingham, Leeds, Liverpool, Manchester, Newcastle and Sheffield Central Libraries but it can only do so much.

What is really needed are local networks involving entrepreneurs, inventors, designers and content providers, investors, local enterprise partnerships, patent and trade mark attorneys and specialist counsel and solicitors, patent information units and universities. I established something like that in Yorkshire and the North West and I am now trying to build up similar networks in London, the East and South East of England and the East Midlands. Patent attorney Barbara Cookson saw the value of those networks right from the start. In her blog Solo IP she wrote in "An Alternative Business Model based on Quality"  on 5 Sept 2008:
"As business people know the best advisers are those which come personally recommended by other clients. A recommendation from a peer comes without bias but a business peer may not know whether he has received the best possible device only other advisers know that. Jane is hoping to build a network that can leave Solo practioners running their own practices but with a platform that enables them to work in teams to provide the services the client needs. This is a great idea because there are business consumers who need experience and are offered only inexperience when they approach big branded law firms because they are compelled to ask for the lowest possible fee. Judging by the company last night there are huge opportunities for businesses to achieve excellent value by using solo practitioners and other great value practices that Jane has sought out."
In Yorkshire we have established lively inventors clubs in Leeds and Sheffield, held clinics and workshops throughout the county, publish our own IP Yorkshire blog, have our own twitter account and Facebook and Linkedin groups. Between us, my collaborators and I have helped many innovative and creative businesses in all sorts of industries to get off the ground and prosper.

Our first event in the East Midlands is a workshop and clinic in collaboration with Loven IP and the Intellectual Property Office at Grantham College on 26 Sept 2014 at 14:00. You can find out more about the event in Our contribution to Grantham's Gravity Fields Science Festival: IP Workshop and Clinic 3 Sept 2014. Admission is free but space is limited so you must book in advance. You can do that through our Eventbrite page or by calling George on 020 7404 5252.  Barristers and solicitors attending the event can claim CPD Points as we are accredited by the BSB and SRA.

Other CPD events are our seminars on the Intellectual Property Act 2014 at the offices of QualitySolicitors Jackson & Canter on 29 Sept 2014 at 16:00 and Leeds Business and IP Centre on 15 Oct 2014 at 18:00 as part of Leeds Business Week. Again, booking is essential. You can use the links or call George on 020 7404 5252.  I look forward to meeting you in Grantham, Liverpool or Leeds.

13 September 2014

More on Scotland and Intellectual Property

Scotland's position in the British Isles, Europe and the World
Source Wikipedia

In "What would an independent Scottish government do about Intellectual Property?" I discussed what the Scottish government said it would do about intellectual property if Scotland seceded from the United Kingdom. Today I will consider what the white paper did not say.

The Current Situation
Scotland like the rest of the UK protects intellectual assets (brands, designs, technology and works of art and literature) by a bundle of laws some of which derive from statute such as patents, copyrights and trade marks, some from European Union regulations such as Community designs and trade marks, and some such as confidentiality and passing off from common law. Some of those rights have to be registered with the Intellectual Property Office in Newport, others with the Office for Harmonization in the Internal Market ("OHIM) and European patents with the European Patent Office ("EPO") in Munich. Intellectual property claims are brought in the Court of Session in Edinburgh under Chapter 55 of the Court of Session Rules. There is a designated intellectual property judge in the Court of Session who hears cases that would be brought in the Patents Court and the rest of the Chancery Division in England including the Intellectual Property Enterprise Court ("IPEC") but there is no equivalent to IPEC and certainly nothing like IPEC's small claims track.

UK Statutes
The Registered Designs Act 1949, the Patents Act 1977, the Copyright, Designs and Patents Act 1988 and the Trade Marks Act 1994 apply to Scotland as they do to England and Wales though some provisions apply only to Scotland. Each of those Acts confers monopolies or other exclusive rights that apply throughout the UK. If a judge of the High Court or Court of Session forbids the infringement of one of those monopolies or exclusive rights his or her order applies to the whole of the United Kingdom and is not confined to the territorial jurisdiction of his or her court.

EU Intellectual Property Rights
The Community Trade Mark Regulation (Council Regulation (EC) No 207/2009 of 26 February 2009on the Community trade mark), the Community Design (Council Regulation (EC) of 12 December 2001 on Community designs) and the Community Plant Varieties Regulation (Council Regulation (EC) of 27 July 1994 on Community plant variety rights) create rights that apply throughout the EU. Those rights are enforced in the courts of the member states whose jurisdiction extends throughout the EU. The Court of Session is one of several courts in the UK to be designated as Community trade mark and Community design courts and it is also the court in which actions under the Community Plant Varieties Regulation would be brought against a person domiciled in Scotland by virtue of art 101 of that regulation.

Scottish Common Law
The law of confidence in Scotland developed differently from the law of confidence in England (see Scottish Law Commission's report on breach of confidence, Dec 1984) but the practical effect seems to be the same. That also appears to be true of the law of passing off William Grant & Sons Ltd and Others v Glen Catrine Bonded Warehouse Ltd and Others [2001] ScotCS 116 (16 May 2001).

Effects of Scottish Secession
Were Scotland to secede from the UK there would be diplomatic, institutional and legislative consequences. As for the first of these the new state would have to negotiate continuing membership of, or accession to, the World Trade Organization ("WTO"), the World Intellectual Property Organization ("WIPO") and the European Union. It would also have to.accede to the usual international intellectual property treaties and the European Patent Convention ("EPC"), The second of those consequences is that the territory for which the Intellectual Property Office can grant monopolies will diminish and the Supreme Court will cease to hear appeals from the Court of Session.  The third is that legislation would be required to preserve and adapt the UK intellectual property statutes until they are repealed by a Scottish legislature and to introduce the new Scottish utility model referred to in my previous article.

Diplomatic Consequences
It is unlikely that a secessionist government would face difficulty in joining the WTO or WIPO despite the misgivings of countries like Belgium and Spain which also face the possibility of national dismemberment. Their voices would be stronger in the European Union and European Patent Organization but it is unlikely that they would be able to prevent Scottish accession altogether if all the other countries including England were in favour. Of course, it is always possible for Scotland to decide not to stay in or re-join the EU particularly if it were forced to adopt the euro as the price of continuing membership or accession. As Mr Nigel Farage MEP noted in a recent radio broadcast, Scotland has returned one UKIP candidate to the European Parliament and Euroscepticism in Scotland is not far behind that in the rest of the UK. It is not a given that Scotland will be a member of the EU on the day it secedes from the Union.

Institutional Consequences
If Scotland secedes it  may be possible to establish a single patent office for the whole of the former United Kingdom ("FUK") on the lines of the Benelux Office for Intellectual Property but that will depend on whether the the remainder of the the FUK sees any advantage in such an arrangement. If not, Scotland would have to establish its own patent office to issue its own patents, trade marks and registered designs including any British registered rights that are preserved as Scottish rights after secession.  Such an office would in any case be required to grant Scottish utility models.  Such an establishment will require the recruitment of examiners, training of hearing officers and the like which will cost money and that money will probably be raised from renewal fees and other charges on proprietors of Scottish patents, trade marks and registered designs. As I can see no reason for the IPO's expenses to diminish significantly on Scottish secession its fees are also unlikely to diminish. One immediate consequence of secession will be an increase in the costs of prosecuting and maintaining patent, trade mark and registered design protection throughout the FUK.

As there will be separate monopolies for Scotland and the remainder of the UK the jurisdiction of the intellectual property judge in Edinburgh and the Patents and Enterprise Judges in London in relation to statutory intellectual property rights will shrink to their respective territorial jurisdictions. Accordingly, it will be necessary to bring separate actions in Edinburgh and London to enforce throughout the FUK a right that can presently be enforced by litigation in either city. That is bound to increase significantly the costs of enforcement as well as the costs of prosecution and maintenance of IP rights.

Yet another institutional consequence is that the Court of Session will be the final court of appeal for intellectual property cases in Scotland. That has the advantage of taking away a layer of appeal which should reduce costs but it will remove the possibility of correcting the errors of the court below. The possibility of such error is greater in Scotland than it is in England for the simple reason that there is less IP litigation in Scotland and thus less opportunity to acquire the experience of the Patent and Enterprise Judges in England.

Legislative Changes
The legislation providing for secession will probably provide for the continuance of UK statutes including the he intellectual property enactments mutatis mutandis for the time being. However, new legislation would be required to establish a Scottish patent office and utility models. If Scotland leaves the EU even temporarily the Community trade mark, design and plant varieties regulations would cease to apply. That would be inconvenient for those with accrued rights or obligations under those regulations.

Although as a graduate of Scotland's oldest university and one of the UK's best I fervently hope that Scottish voters will decide not to partition our island on Thursday contingency plans have to be made in case they do. Scottish secession will affect the North of England more than the rest of the country because we shall again be on the frontier. For that reason I shall be following events less than 200 miles away with more interest than most English intellectual property lawyers. Should anyone wish to discuss this article or any issue arising out of Scottish secession he or she may call me during office hours on 020 7404 5252 or message me through my contact form.

10 September 2014

What would an independent Scottish government do about Intellectual Property?

In view of recent opinion polls I have taken another look at page 102 of the Scottish Government's white paper Scotland's Future. That contains a section headed "Intellectual Property" which consists of 4 paragraphs though only the first sets out any policy. The second is concerned with the Scottish Arbitration Centre, the third is on immigration and the fourth is on a joint venture between Visit Scotland and the Walt Disney Company and the exposition of Scottish food and drink in Florida.

So what is the policy? I reproduce the first paragraph of the section on IP in full:
"We will ensure continuity of the legal framework for protecting intellectual property rights. Independence will also allow Scotland to offer a simpler and cheaper, more business-friendly model than the current UK system, which is bureaucratic and expensive, especially for small firms. The UK is one of the few EU countries which does not offer a scheme which covers the basics of protection. Scotland could follow, for example, the German model which protects technical innovations."
As to the first sentence on the continuity of the legal framework, I am very glad to hear it. Of course, a large part of that legal framework derives from EU regulations - Community trade marks, designs and plant breeders' rights - and there will soon be the Unitary Patent which will apply to most of the EU member states. It is by no means certain that Scotland would be allowed to join the EU on the day that it secedes from the Union or indeed at all since Scottish secession would not be welcomed by countries like Spain and Belgium with their own secessionist regions. Scotland would also have to join the World Trade Organization and the World Intellectual Property Organization and accede to and ratify the European Patent Convention, the Paris and Berne Conventions and other intellectual property treaties all of which would take time.

As for the second sentence the biggest problem for small firms is enforcement. We have gone quite a long way in that regard in England and Wales by establishing the Intellectual Property Enterprise Court including the small claims track. There is nothing like that in Scotland.  Intellectual property claims have to proceed in the Court of Session in Edinburgh. On the last occasion I found myself in the small claims track of IPEC I was representing a business in the Highlands in relation to infringements that were alleged to have taken place in Scotland. Both parties found it cheaper and easier to litigate in the small claims track where the costs downside was  minimal than in Edinburgh. In  Buchanan v. Alba Diagnostics Ltd [2004] UKHL 5, 2004 GWD 5-95, 2004 SCLR 273, 2004 SC (HL) 9, (2004) 27(4) IPD 27034, 2004 SLT 255, [2004] RPC 34 which was a case between two Scottish SME the case went on for ages even before it got anywhere near the House of Lords and there were even experiments in the well of the court. It must have cost the parties a fortune.

The third sentence of the policy seems to favour utility models. As Laddie, Prescott and Vitoria have observed we used to have something like utility models in the whole UK until the 1930s when we protected functional designs. Until the Copyright Designs and Patents Act 1988 came into force we provided very extensive protection for industrial designs by treating design and engineering drawings as artistic works and products made to such drawings as infringing copies of those works even though the infringer never had sight of those drawings. Remedies were draconian for each infringing copy was treated as the copyright owner. The decision of the House of Lords in  British Leyland Motor Corp and others v Armstrong Patents Company Ltd and others [1986] 2 WLR 400, [1986] UKHL 7, [1986] RPC 279, (1986) 5 Tr LR 97, [1986] FSR 221, [1986] 1 All ER 850, [1986] ECC 534, [1986] AC 577 prompted the reform of industrial design law.

Both Sir John Whitford and the government of the day considered re-introducing utility models as an alternative to artistic copyright protection of industrial designs but ruled it out as there was no support, and indeed some opposition, from British industry. Much the same happened when the Commission canvassed the idea of a European utility model some years ago. The problem is that utility models are essentially unexamined patents which add to the problems of "patent thickets" which Professor Hargreaves identified in his report.  It is true that we are one of the few countries in the EU not to have utility models but that is because we have something better: unregistered design rights which come into being automatically and cost business nothing. Scottish businesses had the opportunity of objecting to unregistered design right in the consultation on the reform of design law following Hargreaves but none chose to do so.

This very brief and vague statement of policy probably has something to do with the fact that innovation in Scotland is not what it was.  As I showed in "Funding your Invention: R & D Tax Credits"  27 Aug 2014 NIPC Inventors Club there were only 900 British patent applications from Scotland in 2013 compared to 2,822 from South East England, 2,588 from London and 1,802 from East Anglia and only 905 applications for R & D tax credit from Scotland compared to 3,030 from the South East, 2,715 from London and 1,630 from the East of England.  Of course Scotland does have the revenues from North Sea oil for the time being but that will run out one day. Won't it.

06 September 2014

The Intellectual Property Act 2014 (Commencement No. 3 and Transitional Provisions) Order 2014

Jane Lambert

On 14 May 2014 the Intellectual Property Bill received royal assent. The Act made some far reaching changes in patents, registered design and unregistered design right law which I summarized in "Reflections on the Intellectual Property Act 2014"  7 June 2014 4-5 IP Tech and discussed in detail in "How the Intellectual Property Act 2014 changes British Patent Law" 21 June 2014 JD Supra, "How the Intellectual Property Act 2014 changes British Registered Design Law" 19 June 2014 JD Supra and "How the Intellectual Property Act 2014 will change British Unregistered Design Right Law" 11 June 2014 JD Supra 11 June 2014. On 28 Aug 2014 Lady Neville-Rolfe, Minister for Intellectual Property, signed The Intellectual Property Act 2014 (Commencement No. 3 and Transitional Provisions) Order 2014 which will bring many of the provisions of the Act into force.

Art 3 of the Order provides that most of the sections of the Act which are listed in a schedule to the Order will come into force on the 1 Oct 2014.  Most of these will require further secondary legislation but some will come into effect immediately on the commencement day thereby requiring a number of transitional measures which are dealt with in the rest of this Order.

Commissioned Designs
S.6 (1) of the Act repeals 2 (1A) of the Registered Designs Act 1949 so that a person who commissions a design will no longer be treated as the original proprietor of the design subject to any contract or rule of law to the contrary.  Art 4 of the Order provides:
"Section 6(1) of the Act does not apply to—
(a) any design created before the commencement date, or
(b) any design created on or after the commencement date in pursuance of a commission (irrespective of whether the design was commissioned before, on or after the commencement date) provided that—
(i) the designer and the commissioner of the design have entered into a contract relating to the commission of the design, and
(ii) the contract was entered into before the commencement date."
Damages for Patent Infringement
S.62 (1) of the Patents Act 1977 provides:
"In proceedings for infringement of a patent damages shall not be awarded, and no order shall
be made for an account of profits, against a defendant or defender who proves that at the date of the infringement he was not aware, and had no reasonable grounds for supposing, that the patent existed; and a person shall not be taken to have been so aware or to have had reasonable grounds for so supposing by reason only of the application to a product of the word “patent” or “patented”, or any word or words expressing or implying that a patent has been obtained for the product, unless the number of the patent accompanied the word or words in question."
S.15 (1) of the 2014 Act insets the words “or a relevant internet link” after "number of the patent" and the following sub-section (1A) which provides that
"The reference in subsection (1) to a relevant internet link is a reference to an address of a posting on the internet—
(a) which is accessible to the public free of charge, and
(b) which clearly associates the product with the number of the patent.”
Art 5 of the Order provides that  s.15 does not apply in respect of the infringement of a patent referred to in section 62 (1) of the Patents Act 1977 where the infringement occurred before the 1 Oct 2014.

Revoking Invalid Patents
S.16 (4) of the Intellectual Property Act 2014 confers upon the Comptroller-General of Patents. Designs and Trade Marks a new power to revoke patents that are considered to be invalid following a request for an opinion under s.74A of the Patents Act 1977. Art 6 of the Order states that this power shall apply only where a request for an opinion is made after 1 Oct 2014.

Sharing Information with Overseas Patent Offices
S.18 of the Act permits the Comptroller to share certain information relating to unpublished patent applications to overseas patent offices. Art 7 of the Order makes clear that that does not apply to an application for a patent whose date of filing is before the 1 Oct 2014.

Seminar in Leeds
I shall be discussing the Act in detail in a presentation to the Leeds Business and IP Centre at 18:00 on 15 Oct 2014 as part of Leeds Business Week for which SRA, BSB and probably IPReg points will be available. This will be useful for patent and trade mark attorneys ans specialist lawyers as well as business leaders, designers, inventors and their investors. It is based on a talk that I gave on the 19 May 2014 in London. Further details are in "CPD Event - "The Intellectual Property Act 2014 - What it means to you and your clients" Leeds 15 Oct 2014 IP Yorkshire. If you want to attend please call my clerk on 020 7404 5252 or send me a message through my contact form.