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Intellectual Property Matters – May 2015

Intellectual Property Matters – May 2015

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13/05/2015

“Happy Birthday to You”: why you won’t hear it on TV

The song “Happy Birthday to You” is allegedly the highest grossing song of all time. […]

The song “Happy Birthday to You” is allegedly the highest grossing song of all time. The beneficiary of the royalties is Warner/Chappell Music. Film or TV producers wanting to include the song in their production need to apply to Warner/Chappell for a licence to do so or, as is perhaps more common, muddle through with an alternative form of greeting.

That the latter course is more common is not surprising given that, according to reports, a basic licence can cost upwards of $500, with more likely to be charged for bigger productions (e.g. major films).

The film/TV industry has gone along with this for years but now the Warner/Chappell stranglehold on the song is being challenged. A company, with the name Good Morning to You Productions, is challenging the copyright in the song, having filed a class action back in 2013. At a hearing in March, both it and the defendant – Warner/Chappell – agreed that the case should stay with a judge but if he was unable to give a ruling, the case should go to trial.

The history of the song is a long and confused one, and it is upon that confusion that the claimant company will rely. The song was originally composed in the 1890s with the title “Good Morning to All”. The composers – two sisters – sold the rights to the song and over time the song has evolved and the owners of the rights have continued to change hands. Copyright is not due to expire until 2030 unless the court decides that the song belongs to the public domain – and there are plenty of people who think it does, maintaining that the copyright has already expired, if indeed there was any copyright in the song in the first place.

No date is set yet for the judge’s ruling. At this stage, the lesson is that copyright can exist in places where you would not necessarily expect to find it.

Copyright in sound recordings and the importance of claiming copyright promptly

The music industry is no stranger to cases of copyright infringement. Procol Harum’s seminal Whiter […]

The music industry is no stranger to cases of copyright infringement. Procol Harum’s seminal Whiter Shade of Pale was the subject of protracted court proceedings a few years ago. More recently, a dispute has arisen as to ownership of the rights in the no less anthemic Stairway to Heaven, by Led Zeppelin. Last month it was the turn of the rapper, Shawn Carter, more popularly known as Jay-Z, to face the music.

Jay-Z and the music label, Roc-A-Fella Records, faced a claim from a sound engineer that they had previously worked with, who claimed to be the joint copyright owner of three albums produced by the label. Specifically, the claimant maintained that he had worked on 41 recordings for the label between August 1999 and November 2000, which recordings were later used on albums produced by Jay-Z and also the musician, Beanie Sigel.

The claim was rejected last month on the basis that it was made out of time. Under US law, a copyright claim has to be filed within three years of the work being registered (copyright is registrable in the United States) provided there were reasonable grounds for a claimant to discover any alleged infringement.

The copyright in this case was first registered in 2000 and the claim was not brought until 2014 with the consequence that the claim was time barred. The judge said that the claimant would have a reasonable awareness of the injury suffered by him because all three albums were a “commercial success” and the absence of any royalties being paid to him should have given him reason to know of the any injury.

Time limitations can be a problem in claims of this nature as often it is only with the passage of time that the success of a recording becomes apparent, and therefore the claim worth making.

Liability of an employer for passing off by an employee

In a summary judgment decision last June, HHJ Hacon in the Intellectual Property Enterprise Court […]

In a summary judgment decision last June, HHJ Hacon in the Intellectual Property Enterprise Court (IPEC) found that the registration by an employee of the defendant of domain names incorporating the terms “X-Pole” and “Silkii”, used by the claimant in relation to its pole dancing products, constituted passing off. The IPEC also found that the domain names were used as instruments of deception, the employee having attempted to sell the domain names to the claimant.

In Vertical Leisure Ltd v Poleplus Ltd [1] the issue for the IPEC was whether the defendant, Poleplus, was vicariously liable for the acts of that employee, even though the registrations had been made in the name of the employee.

The IPEC found that Poleplus was both vicariously liable and jointly liable. It was vicariously liable because the primary purpose in the employee’s mind was to protect the interests of his employer and the registrations were within the types of act that he was employed to do – indeed, he had sole responsibility within the company for registering domain names. It did not matter that the registrations were in the employee’s rather than the company’s name.

The IPEC did not find Poleplus liable by reason of a common design. The Court considered the recent Supreme Court judgment on the common design in Sea Shepherd UK v Fish and Fish Ltd [2] which it summarised to mean that in order to fix an alleged joint tortfeasor (in this case the company) with liability, it must be shown both that it actively co-operated to bring about the act of the primary tortfeasor (the employee) and also that it intended that its co-operation would help to bring about that act (the act found to be tortious). Liability will always be subject to the threshold requirement that the alleged joint tortfeasor’s contribution to the act was more than de minimis.

In this case, there was no evidence to suggest that the sole director had caused or encouraged the employee to register the domain names; indeed, the evidence indicated that she had been unaware of the registrations until they had been made.

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[1] [2015] EWHC 841 (IPEC)
[2] [2015] UKSC 10

Live streaming of sporting fixtures over the internet and copyright

Article 3(1) of the Copyright Directive [1] provides for a right of communication to the […]

Article 3(1) of the Copyright Directive [1] provides for a right of communication to the public in respect of literary, artistic, domestic and musical works. Under Article 3(2) Member States are obliged to provide in their national laws for a “making available on demand” right.

Article 3(2)(d) provides a right of communication to broadcasters in respect of their broadcasts. It states that Member States must provide for the exclusive right for broadcasting organisations to authorise or prohibit the making available of “fixations of their broadcasts” in a way that allows the public to access them at a place and time of their choosing.

In C More Entertainment v Sandberg [2] the claimant was a Swedish pay-TV company which broadcasts ice hockey matches on its website, upon payment of a fee. The defendant created links on his own website which enabled the paywall put in place by the claimant to be circumvented, effectively enabling internet users to access the live broadcasts for free.

The issue before the Court, referred by the Swedish Supreme Court, was whether Article 3(2) of the Copyright Directive must be interpreted as precluding national legislation extending the protection afforded to the broadcasters by Article 3(2)(d) to acts of communication to the public, such as live broadcasts of sporting fixtures on the internet.

The Court of Justice ruled that the concept of “making available to the public” forms part of the wider “communication to the public” and that the concept of “making available to the public” is intended to refer to interactive on-demand transmission – not to live broadcasts. In the case of live broadcasts, there is no choice as to time. Either the user watches it live or not. Consequently “live streaming” does not fall within the definition of “making available to the public” within the meaning of Article 3(2).

The Court explained that the Copyright Directive was only a partial harmonisation measure and it was open to Member States to afford greater protection to rights holders, in this case broadcasters, than was set out in the Directive, provided this did not undermine copyright.

In essence therefore the Court ruled that Member States can legislate to extend broadcasters’ rights of communication to the public under the Copyright Directive to cover acts such as linking to live broadcasts, provided that such legislation does not undermine the protection of copyright under EU law.

Broadcasters will welcome the decision as it allows Member States to bring the protection of paywall-protected live streaming within the scope of national copyright legislation, so that deliberate circumvention of paywalls can be infringement.

This case follows the Court’s 2013 ruling in ITV Broadcasting Ltd and others v TV Catchup Ltd [3] that the distribution by intermediaries of copyright-protected works by live streaming over the Internet was a communication to the public within the meaning of Article 3(1) of the Directive and, as such, a potentially infringing act.

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[1] Directive 2001/29
[2] Case C-279/13
[3] Case C-607/11

Parody of well-known marks – how far can you go?

The claimant was the proprietor of the mark PUMA (shown here) used in connection with […]

The claimant was the proprietor of the mark PUMA (shown here) used in connection with sportswear. The defendant, a T-shirt design company, was the registered proprietor of the mark PUDEL (“poodle” in English), which was registered later, shown here.

The proprietor of the PUMA mark instituted proceedings for trade mark infringement and the case worked its way all the way up to the German Supreme Court.

The Supreme Court considered that although there were obvious differences between the two marks, namely the wording and the image, they were nonetheless sufficiently similar to warrant ordering the removal of the PUDEL mark from the trade marks register.

The rationale for the Court’s decision was twofold; firstly the Court found that the PUDEL mark took unfair advantage of the character and repute of the PUMA mark and secondly, it found that the rights of the owners of that mark outweighed those of the PUDEL mark’s owners in respect of their right to freedom of art and free expression.

The Court considered that although there was unlikely to be confusion on the part of the public there was still the potential for consumers to mentally connect the two marks in a way that was unfair to PUMA.

The “own name” defence to trade mark infringement proceedings

In Maier v Asos Plc [1] the claimant was appealing against a High Court decision […]

In Maier v Asos Plc [1] the claimant was appealing against a High Court decision that there was no likelihood of confusion between the defendant’s word mark ASOS, registered as a UK trade mark in relation to skin care products, clothing and the bringing together of those products for retail purposes, and its own word mark ASSOS, registered as a Community trade mark in relation to cycling products and clothing, and casual clothing. The judge had also refused to grant a declaration of invalidity in respect of the ASOS mark, although she did agree to exclude specialist cycling-related goods and services from the registration.

Subsequently, the EU General Court upheld a Board of Appeal decision that there was a likelihood of confusion between a proposed Community trade mark for Asos and the existing Community trade mark.

On appeal, the central issue was the applicability of the “own name defence” afforded by Article 12 of the Community Trade Mark Regulation. This provides that an otherwise infringing act cannot be prevented by the trade mark proprietor where the infringer is using his own name, so long as he uses it in accordance with honest practices in industrial or commercial matters.

The Court found that there was a likelihood of confusion on the part of the public, at least in respect of the sale by the defendant of casual wear and the provision of its retail services in relation to such casual wear. The Court was united in finding that the judge at first instance had erred by only considering the likelihood of confusion in relation to the actual use made by the claimant of the ASSOS mark and not also the notional and fair use of the mark in respect of all the goods falling within the scope of the specification.

ASOS argued that it could rely on Article 12 as it was using its own name (one that it had registered shortly after the claimant’s application to register the mark ASSOS). The Court of Appeal – by a majority – agreed.

The Court examined the conduct of ASOS before and after the proceedings began. The mark ASOS was clearly derived from the company’s earlier corporate name, As Seen On Screen, without knowledge of ASSOS and there was no evidence that the name ASOS had been chosen dishonestly. It appeared that ASOS had also taken steps to exclude certain goods from its website to minimise the risk of confusion with the claimant’s ASSOS goods. On the other hand, it had not taken effective steps to ensure that it was free to adopt the ASOS mark without infringing the rights of a third party. Taking this into consideration, the majority of the Court found that the own name defence was made out.

Sales LJ, in a dissenting judgment, took the view that as a matter of ordinary “honest practices” in the commercial context it was incumbent upon ASOS to have adopted a different sign to avoid creating a likelihood of confusion with the claimant’s goods. We understand that the claimant is likely to seek leave to appeal to the Supreme Court on this point.

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[1] [2015] EWCA Civ 220

The function of a trade mark

Katy Perry’s performance at this year’s Super Bowl very quickly became an internet sensation, in […]

Katy Perry’s performance at this year’s Super Bowl very quickly became an internet sensation, in large measure thanks to the performance of one her backing dancers – dressed as a shark. One of the dancing sharks (now known as the “Left Shark”) appeared not to know the choreography and fumbled his (or her) way endearingly through the routine. The impromptu routine went viral immediately.

Katy Perry, aware of or advised as to the commercial possibilities, has since tried to register the Left Shark design as a trade mark. She has already begun merchandising the shark design, for example on clothing, and her advisers have issued at least one cease and desist letter in respect of the Left Shark.

The US Trademark Office has, however, given the trade mark application very short shrift, refusing it last month on the basis that the Left Shark does not function as a mark that identifies or distinguishes Katy Perry’s musical performances from those of other performers. In other words, a consumer, on seeing the Left Shark, will not necessarily think of Katy Perry. Without such an association, the application was doomed.

The trade mark examiner also highlighted significant discrepancies between the drawing submitted in support of the application and the actual design of the Left Shark that achieved fame at the Super Bowl.

The case is a good illustration both of how merchandising works in the digital age and also of the absolute fundamentals of the purpose of a trade mark.

The test for inherent and acquired distinctiveness of a Community trade mark

The General Court has delivered a significant ruling on the invalidity of a Community trade […]

The General Court has delivered a significant ruling on the invalidity of a Community trade mark for lack of distinctive character.

The case concerned Community trade marks registered in the name of Louis Vuitton. The marks comprised a chequerboard pattern characterised by weft and warp structures, one in brown and beige, the other in light and dark grey. The marks were registered for various goods in Class 18, such as bags, cases, leather goods.

The applicant for invalidity, Nanu-Nana, based its claims on several absolute grounds for refusal, including that the marks were descriptive and lacked distinctive character, that they were customary in the bona fide and established practice of the trade, and that they consisted exclusively of a shape giving substantial value to the goods.

The Cancellation Division and the Board of Appeal agreed that the marks should be cancelled as they were not distinctive; they consisted of a pattern that would be applied to the surface of the goods as decoration rather than identifiers of origin; and the patterns did not depart from the norms or customs of the sector.

The Board of Appeal held that the fact that the marks had been copied by competitors or infringers did not mean that the public would be able to distinguish Louis Vuitton’s goods covered in the chequerboard design from those of competitors.

Both the Cancellation Division and the Board of Appeal held that the evidence submitted by Louis Vuitton was insufficient to show that the marks had acquired distinctiveness through use in a number of EU Member States.

The General Court agreed with all of the Board of Appeal’s findings and dismissed Louis Vuitton’s appeal. On the lack of inherent distinctive character, the General Court considered the existing case law on the distinctiveness of 3D and figurative marks which coincide with the appearance of the products. This is to the effect that, in the absence of any graphic or word elements, such signs will only with difficulty identify a commercial origin, unless the design departs from the norms and customs of the sector. The Louis Vuitton designs did not; indeed, the design in question had a long association with goods in Class 18, where it was used for decorative purposes.

On the failure to adduce sufficient evidence of acquired distinctiveness, the General Court held that a mark cannot be distinctive if it is not distinctive in a part of the EU, given the unitary character of a Community trade mark. Since Louis Vuitton was unable to present evidence of the marks’ acquired distinctiveness in some Member States, the mark was invalid.

The ruling has been greeted with some surprise, given the ready association of the chequerboard pattern with Louis Vuitton. It is possible that Louis Vuitton may appeal to the Court of Justice of the European Union.

Trade marks: registry review – May 2015

FAZENDA [1] The Opposition Division has upheld an opposition to an application for registration of […]

FAZENDA [1]

The Opposition Division has upheld an opposition to an application for registration of the mark FAZENDA by the proprietor of the mark 3 FAZENDAS. The contested mark contained stylised verbal elements and also the words “RODIZIO BAR & GRILL”.

The opposition was based on Article 8(1)(b) of the Community Trade Mark Regulation, namely identical goods and similar marks, resulting in a likelihood of confusion. The Opposition Division considered that consumers would focus their attention on the FAZENDA element of the contested sign, this being the most prominent and distinctive element of it. It considered that a lesser degree of similarity between the goods or services covered by the competing signs could be offset by a greater degree of similarity between the marks and vice versa; in this case, it was of particular importance that the contested goods – alcoholic beverages (except beer) – were identical.

PUMA [2]

Puma SE’s opposition to registration of the mark PUMA in respect of goods in Class 7, namely “lathes; CNC (computer numerical control) lathes; machining centers; turning center; electronic discharge machine” was rejected in its entirety. Puma SE is the proprietor of the mark.

The opposition was based on Article 8(1)(b) and Article 8(5) of the Community Trade Mark Regulation. To succeed under Article 8(1)(b) it was necessary for Puma SE to show a similarity of the goods in question, in order to demonstrate a likelihood of confusion. The goods in respect of which Puma SE’s mark was registered had no connection with the goods in Class 7 in respect of which registration was sought – the nature and main purpose of the goods was different, they had different distribution channels and were not in competition nor complementary.

Under the Article 8(5) ground of opposition Puma SE argued that its mark had a reputation in the relevant Member State and the use without due cause of the contested mark would take unfair advantage of, or be detrimental to, the distinctive character or repute of its earlier trade mark. The Opposition Division did not consider that the evidence adduced by Puma SE was sufficient to show the existence of its mark was known by such a significant part of the relevant public that it reached the threshold necessary for a finding of reputation.

APPLE [3]

The Opposition Division has upheld Apple’s opposition to registration of the mark iphion, Apple being the registered proprietor of the mark IPHONE. The contested services were in Class 35 (advertising; business management; business administration; office functions); Class 38 (telecommunications) and Class 41 (education; providing of training; entertainment; sporting and cultural activities).

For reasons of procedural economy, the Opposition Division focused o the comparison of the signs on the French-speaking part of the relevant public. The Opposition Division considered the signs to be visually and aurally similar but conceptually dissimilar. Taking a global assessment to the issue of a likelihood of confusion, the Opposition Division found that there was a likelihood of confusion, taking into account the imperfect recollection of the consumer, and that consumers tended to remember similarities rather than dissimilarities. The Opposition Division found that the differences between the marks were not sufficient to counteract the similarities.

CHANEL [4]

Chanel has successfully opposed the registration of the sign BOY CAPEL, based on its prior registration of the mark BOY CHANEL. The contested goods were in Class 25: clothing, footwear, headgear.

The Opposition Division considered the goods covered by the competing signs were identical and the signs were visually, aurally and conceptually highly similar. The word BOY was non-distinctive in respect of clothing and was considered to have little impact when considering the likelihood of confusion. Both CHANEL and CAPEL were known to be family names, the former being the name of the French fashion designer and the latter reportedly the muse of the aforementioned designer. The part of the public that was aware of the link between the two names could think that the goods came from economically linked undertakings.

The Opposition Division made two more important points regarding the likelihood of confusion of marks relating to clothing: first, the visual aspect played an enhanced role in the likelihood of confusion, given that the choice of item of clothing is generally made visually. Secondly, it is common for undertakings active on the market to use sub-brands, i.e. signs that derive from a principal mark and which have common elements, to distinguish the scope of one product from another. In the circumstances, the Opposition Division found the opposition to be well founded.

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[1] OHIM, Opposition No B 2 394 040
[2] OHIM, Opposition No B 2 170 556
[3] OHIM, Opposition No B 1 498 800
[4] OHIM, Opposition No B 2 368 895

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Alan Harper, Director, Intellectual Property at Walker Morris LLP square

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