Intellectual Property Matters – July 2016
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Jose Mourinho and image rights
The appointments of high-profile football managers to leading clubs are seldom without incident and, predictably, […]
The appointments of high-profile football managers to leading clubs are seldom without incident and, predictably, the appointment of Jose Mourinho as the new manager of Manchester United a few weeks ago was no exception.
An unexpected obstacle to Mourinho’s move to Old Trafford concerned his image rights. The concept of the “image right” has become increasingly familiar in the sporting, particular football context, but it is not an intellectual property right that is recognised in English law – although other jurisdictions do recognise an image right or at least something very like it. Rather, it is a creation of contract. Under the contract, the club will control the use that can be made of a player/manager’s image – this could be their photograph, autograph, catchphrase, goal celebration or shirt number for example. Very often, the player/manager will have assigned whatever rights they have in these to an agency or management company acting on their behalf and the image rights agreement will be entered into between that company and the club. The contract will typically require the player/manager to make personal appearances and perform other services (e.g. create content for social media, TV sessions, community visits) in support of the image and also not to undertake anything which could tarnish that image. Ultimately, the object of the exercise is merchandising.
One obstacle impeding Mourinho’s path to Old Trafford concerned the rights in his name “Jose Mourinho”. This has actually been registered as a trade mark by Mourinho’s former employer, Chelsea, in respect of a range of goods including toiletries, clothing, watchstraps, even talcum powder and lingerie. Chelsea have a registered EU trade mark for Mourinho’s signature and national registrations for his name. Clearly, the existence of these trade marks could seriously impact Manchester United’s merchandising opportunities presented by the arrival of Mourinho. Obviously, the move has gone ahead so it can be assumed that some solution was reached, possibly the grant of a licence by Chelsea for United to use the marks, or an assignment of the marks from Chelsea to United.
A second obstacle concerned endorsement contracts that Mourinho had himself signed with a number of companies who, unfortunately, are competitors with sponsors of United. Mourinho’s appointment will have involved discussions with these companies to ensure that a mutually satisfactory solution regarding Mourinho’s endorsements was reached and to ensure that the terms of any existing agreement concerning the use of Mourinho’s image is not breached.
The case highlights interesting issues around the ownership and control of images of famous sportspeople – or celebrities generally – especially when the rights are not owned by that person.

Glee and series marks
We have reported previously on the dispute between Comic Enterprises and Twentieth Century Fox concerning […]
We have reported previously on the dispute between Comic Enterprises and Twentieth Century Fox concerning the trade mark GLEE. In our last article on the subject, we explained that Fox had applied for permission to introduce a new claim that section 41 of the Trade Marks Act, governing the use of series marks, is incompatible with the requirement of the EU Trade Marks Directive [1], which requires that a trade mark be a single sign capable of graphical representation.
Under section 41, it is possible to register a series of trade marks in the same registration. The qualification (section 41(2)) is that the marks in the series “resemble each other as to their material particularities and differ only as to matters of a non-distinctive character not substantially affecting the identity of the trade mark”. This enables the protection of multiple versions of the same mark within a single registration.
In response to Fox’s argument the UK Intellectual Property Office submitted that series trade marks are a bundle of separate trade marks each entitled to protection under EU law.
The Court of Appeal [2] considered that the Directive allowed Member States the freedom to determine their national provisions and procedures for registering a trade mark and, so long as the mark was a qualifying “sign” and capable of graphical representation so as to enable the competent authorities – in the case of the UK, the UK Intellectual Property Office – to establish with clarity and precision the nature of the sign of which the mark consisted, there was nothing in the Directive that prohibited the registration of a series of marks that satisfied all these conditions.
The Court agreed with the Comptroller of Trade Marks’ submissions that a series registration gave rise to a series of different trade marks, each of which was individually registered, albeit it with a single registration number. The Court reviewed past decisions concerning applications to register a series of trade marks and determined that such applications had consistently been considered as applications to register a number of different trade marks, each of which was required to satisfy the statutory requirements for registrability. In order to qualify as series marks, the trade marks in question must resemble one another in their material particulars.
The case is a useful clarification of the nature of series registrations. It affirms that series marks should not be treated as a single registered mark, with each instance being a manifestation of that one mark. They are a bundle of marks with a single reference number.
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[1] Directive 2008/95/EC
[2] [2016] EWCA Civ 455

Commission proposal to target geo-blocking
The European Commission launched a competition inquiry into the e-commerce sector on 6 May last […]
The European Commission launched a competition inquiry into the e-commerce sector on 6 May last year, with a view to enabling the Commission to identify possible competition concerns in European e-commerce markets. The focus of the sector inquiry is on those goods and services in which e-commerce is most widespread, such as electronics, clothing and shoes as well as digital content. The initial findings from the inquiry, published in March this year, suggest that the practice of “geo-blocking” is widespread in the EU. Geo-blocking is the practice of online providers preventing users from accessing and purchasing consumer goods or digital content services offered on their website based on the location of the user in a Member State different from that of the provider.
The Commission is investigating contractual restrictions in agreements that amount to geo-blocking and which may well be anti-competitive. In parallel, the Commission has published a draft new Regulation whose focus is on unilateral geo-blocking. The proposals follow a consultation that took place at the end of last year.
The proposals in the draft Regulation provide that:
- a trader must not block or limit customers’ access to online interfaces because of a customer’s nationality, residence or place of establishment
- a trader must seek permission from a customer before re-routing a customers based on that customer’s nationality or location. Even if the customer agrees to be re-routed, the trader must make it easy for the customer to return to the original website, if the customer so wishes
- discrimination on grounds of nationality, place of residence or establishment is prohibited. This means that a trader cannot use different terms and conditions for customer based in different Member States. This applies to sales of goods and services, both physical and electronic (e.g. cloud-based services or website hosting), save that there is an exception for copyright-related content
- a trader must not apply different conditions of payment based on nationality, residence, place of establishment of the customer or for any reasons based on the location of the payment account or payment service provider or the country in which the payment instrument is issued.
The Regulation also provides that any agreement requiring traders to act in violation of the Regulations in relation to passive sales – where the trader does not actively solicit the customer’s business – will be automatically void.
Certain sectors are exempt from the proposed Regulation, notably in the intellectual property context, audio-visual services.
The proposed Regulation is still a long way from becoming law. However, it would be a surprise if legislation does not emerge in a form substantially similar to the proposed Regulation.

Trade mark applications in bad faith
One of the defining moments of the 2012 London Olympics was its opening ceremony. At […]
One of the defining moments of the 2012 London Olympics was its opening ceremony. At centre stage of the ceremony was the display by 965 drummers known collectively as the ‘Pandemonium Drummers’. Soon afterwards, the Pandemonium Drummers Association was established consisting of the Olympic performers.
On 3 August 2013, one member of the Association, Andrew Johnston, took it upon himself to register PANDEMONIUM DRUMMERS as a UK trade mark in class 41. This was despite Mr Johnston having been suspended from the group along with the removal of all his responsibilities on 29 July. The reason for his suspension was his attempt to register “Pandemonium Drummers Limited” as a company without the Association’s authority. Mr Johnston then opposed an application for registration of an EU trade mark brought by the Association.
The Association’s opposition to Mr Johnston’s application for registration, and the subsequent focus of the hearing officer’s considerations, was section 3(6) of the Trade Marks Act 1994: “A trade mark shall not be registered if or to the extent that the application is made in bad faith.” The hearing officer considered, in particular, where the divide between legitimate self interest and bad faith should be drawn.
In reaching his decision on bad faith the hearing officer drew heavily on the comments of Arnold J in Red Bull GmbH v Sun Mark [1] in which the judge set out eight principles concerning the assessment of bad faith:
- the relevant date for assessing whether an assessment has been made in bad faith is the application date
- however, later evidence is relevant if it casts light backwards on the position as at the application date
- a person is presumed to have acted in good faith unless the contrary is proved
- bad faith includes not only dishonesty but also “some dealings which fall short of the standards of acceptable commercial behaviour observed by reasonable and experienced men in the particular area being examined”
- the purpose of the bad faith legislation is to prevent abuse of the trade mark system
- the tribunal must make an overall assessment, taking into account all relevant factors
- the tribunal must first ascertain what the defendant knew about the matters in question and then decide whether, in the light of that, the defendant’s conduct is dishonest (or falls short of the standards of acceptable commercial behaviour) judged by the ordinary standards of honest people
- consideration must be given to the applicant’s intention.
The hearing officer found that Mr Johnston had acted in bad faith. As Mr Johnston knew he had no authority to make the application, he was making an application with an improper intention. Emphasis was put on Mr Johnston’s opposition to the Association’s EU trade mark application, as such actions demonstrated his dishonest desire to cause disruption to the Association’s activities. As a result, the hearing officer found in favour of the Association.
As well as offering a useful illustration of the application of section 3(6), the case is a reminder of the need for organisations to be proactive in taking steps to ensure their intellectual property is protected as early as possible. If Pandemonium had applied for its own trade mark registration earlier, then it could have avoided the unpleasantness of contesting Mr Johnston’s application.
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[1] [2012] EWHC 1929 (Ch)

Sky, Skyscape, declarations of non-infringement and costs in the IPEC
The case [1] concerned Skyscape Cloud Services Ltd, a company proving cloud computing services to […]
The case [1] concerned Skyscape Cloud Services Ltd, a company proving cloud computing services to public authorities in the UK, and the telecommunications giant Sky. Initially, Sky, a company renowned for the meticulous presentation and protection of its brand image, wrote to the claimant presenting allegations that the company had infringed numerous Sky trade marks. In a pre-emptive response, Skyscape sought a declaration of non-infringement (DNI) against Sky.
This tactic proved unsuccessful, with the Court finding in Sky’s favour.
The Court considered the circumstances in which it could grant a DNI noting that it was able to do so where it was “appropriate and useful” to do so, notwithstanding the absence of an express provision for the grant of a DNI in UK trade mark law. The proposed DNI was tested against three principles:
- the question of whether to grant the negative declaration is one of discretion, rather than one of jurisdiction
- there must be a useful purpose to the DNI
- the underlying issue must be sufficiently clearly defined in order for it to be rendered justiciable.
In this case, the judge (HHJ Hacon) considered that while the first two conditions were satisfied, it was far from clear that the third was met. This was because the draft DNI presented by Skyscape was very wide. In view of the scope of the draft DNI, the judge considered that Sky only needed to prove that one claimed use was infringing. On this, the central question was whether the average consumer would be confused by the branding of both Sky and Skyscape.
Skyscape argued that their average consumer, a well-informed civil servant in possession of a substantial budget, would able to differentiate between the two brands. However, Skyscape’s draft DNI referred to the public sector as a whole as Skyscape’s typical consumer as opposed to the above. As there are over 29,000 listed public bodies on the Government website, it was held that the average consumer would likely share the same attributes as a typical person on the street, thus considerably widening the prospect of a likelihood of confusion. The likelihood of confusion was enhanced by the prevalence of Sky products and services embodying the name “Sky” followed by the description of the product or service (SkyGo would be an example of this). Additionally, Sky was known to be active in the provision of internet services as well as television services. The judge considered that the average consumer, confronted with the sign “Skyscape”, would consider this to refer to a service operated by Sky.
On the question of infringement, the judge considered that Skyscape had failed to submit satisfactory evidence proving it had not benefited from the use of the word ‘Sky’ in its branding nor as to the effect of its branding on Sky.
As a postscript to this case, it is worth noting that Sky was also – at least partly – successful on costs. Sky attempted to dispute the £50,000 IPEC costs cap. Sky submitted that as its overall costs were in excess of £108,000, it should be able to recover such costs in light of what it perceived to be the vexatious case pursued by Skyscape. Sky also argued the cap costs of £3,000 and £6,000 caps on strike out applications and preparation of witness statement costs respectively should be raised.
On the question of raising the overall costs cap beyond £50,000, the judge considered that although Skyscape’s conduct had been far from ideal, it was not such as to constitute an “abuse of process” that warranted the removal of the costs cap. On the issue of lifting the stage caps on costs, the judge noted that he was able to do so as this would not affect the overall cap of £50,000. In the circumstances, he considered that it was appropriate to lift the cap on stage costs and award an extra £5,000.
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[1] Skyscape Cloud Services Ltd v Sky Plc and others [2016] EWHC 1340 (IPEC)

Copyright in samples
Ed Sheeran, Madonna, Justin Bieber and Led Zeppelin. All household names from the music industry […]
Ed Sheeran, Madonna, Justin Bieber and Led Zeppelin. All household names from the music industry with something else in common: they have either within the last month faced or are currently facing a law suit for copyright infringement in the US.
We have written before about copyright cases involving musicians; see, for example, this article concerning Jay Z, who, through no fault of his own, is no stranger to copyright law, or this article which discusses in a little more detail than here the dispute around Led Zeppelin’s “Stairway to Heaven”.
The case involving Madonna is perhaps the most startling. The claim against her concerned the song “Vogue” and an allegation by the plaintiff that a producer had copied a section of a horn arrangement. The section of the horn arrangement in question lasted 0.23 seconds. This was a case about “de minimis sampling”, where a small element of a track is sampled in another and, specifically whether the US “de minimis” doctrine applied to sound recordings. On this question, previous authority (from the Sixth Circuit) was to the effect that even a de minimis sampling would infringe copyright law, but the Ninth Circuit, ruling on the Vogue dispute, was unpersuaded that this was correct. The Court concluded that “a reasonable jury could not conclude that an average audience would recognise the appropriateness of the composition”. However, the decision was not unanimous, with the dissenting judge stating that the size of the sample in dispute was immaterial, it being “no defence to theft that the thief made off with only a ‘de minimis’ part of the victim’s property”.
The ruling could therefore enable short samples to become increasingly commonplace within the music industry.
Madonna is not the only high-profile artist who has been recently subjected to a law suit for an alleged copyright infringement. Singer-songwriter Ed Sheeran is currently subject to a $20million law suit with regard to his 2014 record ‘Photograph’ which is alleged to have shared 39 similar notes with Matt Cardle’s ‘Amazing’. Similarly, Justin Bieber’s 2015 record ‘Sorry’ is subject to action as its distinctive vocal riff was allegedly lifted from Casey Dienel’s ‘Ring the Bell’.
What is prompting the wave of claims for copyright infringement of this type? In part, it may be that advances in software have made it easier to establish similarities between different songs than was the case previously. When samples are as short as fractions of a second, however, it can be very hard to establish actual copying as opposed to, for example, the inadvertent recollection and recreation of music heard years previously.

10 years’ for online copyright infringement
The Government has announced its intention to increase the maximum term of imprisonment for online […]
The Government has announced its intention to increase the maximum term of imprisonment for online copyright infringement to 10 years. The current maximum term is two years. An increase to 10 years would match the maximum term for copyright infringement in physical goods.
The Government’s consultation on increasing the maximum custodial term for online copyright infringement elicited a number of negative responses with respondents suggesting that online copyright infringement could and should not be equated with other offences that carry the same maximum custodial term, such as child cruelty, firearms offences and rioting. Undeterred, the Government intends to introduce new legislation into the Copyright, Designs and Patents Act 1988, explaining that there is no logical reason why the online offence should be treated any differently from its physical counterpart.
There is a clear economic rationale to the legislative proposals as well, given the growing impact of online copyright infringement on the country’s creative industries. Even so, the scope of the legislation is striking; it could, for example, catch a private individual engaged in uploading unauthorised films or music to file sharing websites. The Government has stated, however, that the maximum term should not apply in practice to low level infringement with minimal effects and where the individuals concerned were unaware of the impact of their behaviour.

The Rubik’s Cube and three-dimensional trade marks
The Rubik’s Cube was registered as a three-dimensional EU trade mark with the European Union […]
The Rubik’s Cube was registered as a three-dimensional EU trade mark with the European Union Intellectual Property Office (EUIPO) in 1999. The trade mark was registered in respect of “three-dimensional puzzles”.
A German toy-manufacturing company, Simba Toys, has applied to the EUIPO to have the mark cancelled, in particular on the ground that that it involves a technical solution, consisting of a rotating capability, and that such a solution may be protected only as a patent and not as a trade mark. This matters in particular because the patent for the cube has expired.
That action was considered and dismissed by the lower of the EU’s two courts, the General Court, in 2014. The General Court held that the graphic representation of the shape of the Rubik’s Cube did not involve any technical function such as to preclude it from protection as a trade mark and therefore it could be registered. Simba has since appealed to the higher of the two EU courts, the Court of Justice of the European Union (CJEU).
Prior to the CJEU ruling the Advocate General has opined on the issue. An Advocate General’s Opinion is not binding on the CJEU but rather is a proposal to that court of a legal solution to the problem before it. Although an Advocate General’s Opinion is not binding on the CJEU, although in practice they are followed by the Court more often than not.
The Advocate General’s Opinion takes issue with the General Court, finding fault with the approach it followed. The Advocate General suggests that in order to carry out a proper analysis of the functional features of the shape, the General Court should have first taken account of the function of the goods concerned, namely the three-dimensional puzzle, that is “a brain-teaser consisting of logical arrangements of moveable elements”. Had it done so, the Advocate General continues, the Court could not have rejected Simba’s submission that the cube will be perceived as consisting of movable elements divided by black lines. The position taken by the General Court was that the rotating capability of the cube results neither from its black lines nor grid structure but from an internal mechanism that is not visible on its graphic representations and that, as a consequence, the registration does not prevent other companies from making different three-dimensional puzzles which do not have the same surface layout as the cube.
The Advocate General also argues that the trade mark for the cube harms international competition as the mark’s proprietor could “extend its monopoly to the characteristic of goods which perform not only the function of the shape in question but also other, similar functions”.
We shall provide an update when the CJEU delivers its ruling.