Intellectual Property Matters – November 2016
Print newsletter
ASOS and ASSOS settle their dispute
The fashion retailer ASOS has reportedly agreed to pay £20.2 million to two European retailers, […]
The fashion retailer ASOS has reportedly agreed to pay £20.2 million to two European retailers, the cyclewear manufacturer ASSOS and menswear retailer Herrenhaus, to settle the high-profile trade mark dispute between the parties.
The dispute reached the Court of Appeal early last year [1], where the claimant appealed against a High Court judgment that there was no likelihood of confusion between the defendant’s ASOS mark, 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 an EU 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 EU trade mark.
The principal issue when the case came before the Court of Appeal was the applicability of the “own name” defence provided by Article 12 of the Community Trade Mark Regulation [2]. Article 12 states 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.
ASSOS was refused permission to appeal to the Supreme Court on the “own name” defence.
It is reported that the settlement agreement reached by the parties will entitle ASOS to sell athletic leisurewear but will be prohibited from selling cyclewear and from opening shops in Germany. Additionally, ASOS is paying £20.2 million. Shares in ASOS, which is quoted on AIM, rose on news of the settlement.
______________________
[1] [2015] EWCA Civ 220
[2] Regulation (EC) No 207/2009. Article 12 was amended by Regulation 2015/2424, which came into effect on 23 March 2016. The amended Article 12 continues to stipulate that the defence only applies where the use made by the third party is “in accordance with honest practices in industrial or commercial matters”. However, the amended Article 12 states that the defence only applies where the third party is a “natural person” – which does not include companies.

Hyperlinking and copyright infringement
We reported in June on the ruling of the Court of Justice of the European […]
We reported in June on the ruling of the Court of Justice of the European Union (CJEU) in Svensson v Retriever Sverige [1] that a website which redirects internet users through hyperlinks to copyright-protected material that is already publicly available does not infringe the copyright in that material. The issue of hyperlinking has come before the CJEU again and, in an important decision, the CJEU has built on its ruling in Svensson.
In GS Media [2], the CJEU summarised the issue before it as whether, and in what possible circumstances, the act of posting, on a website, a hyperlink to protected works freely available on another website, without the consent of the copyright holder, constitutes a “communication to the public” within the meaning of Article 3(1) of the Information Society Directive. [3]
The Court explained that the Directive sought to achieve a fair balance between, on the one hand, the interests of copyright holders and related rights and, on the other, the interests and fundamental rights of users of protected objects (in particular their right to freedom of expression and to be able to access information). After a review of relevant authorities, including Svensson, the Court held that posting a hyperlink on a website to works protected by copyright and published without the author’s consent is not a “communication to the public” when the person who posts the link does not seek financial gain and acts without knowledge that those works have been published illegally.
The Court qualified this finding by stating that where hyperlinks are indeed posted for profit, there is a presumption that the posting has been done with full knowledge of the protected nature of the work and of the possible lack of the right holder’s consent to the publication. Where that presumption is not rebutted, the act of posting a hyperlink to a work illegally published on a website will constitute a “communication to the public” for the purposes of Article 3(1).
The Court also stated that where right holders make the person posting the hyperlink aware of the illegal nature of the publication to which the link is made, and where they refuse to take down the link, they will not be able to rely upon one of the exceptions to infringement set out in Article 5(3) of the Directive.
This case marks a departure from previous case law by insisting upon the relevance of the state of mind of the person posting the link. This effectively introduces an element of subjectivity into the context of primary infringement of copyright.
_____________________
[1] Case C-466/12
[2] Case C-160/15
[3] Directive 2001/29. Article 3(1) states: “Member States shall provide authors with the exclusive right to authorise prohibit any communication to the public of their works, by wire or wireless means, including the making available to the public of their works in such a way that members of the public may access them from a place and at a time individually chosen by them.”

Landmark decision on provision of free Wi-Fi
The Court of Justice of the European Union (CJEU) has ruled on whether an individual […]
The Court of Justice of the European Union (CJEU) has ruled on whether an individual who operated a Wi-Fi network that was accessible to the public free of charge was an intermediary within the meaning of the E-Commerce Directive [1] (the Directive) (i.e., in the language of the Directive, he was providing an “information society service”) and to what extent the safe harbours contained in Article 12 of the Directive regarding the liability of intermediaries were applicable.
The ruling was made in the context of proceedings between Sony and a Mr Tobias McFadden, who operates a business supplying lighting and sound systems and who owns a Wi-Fi connection that is not password protected and is made available to anyone visiting his shop. A customer used the connection to illegally upload and share a musical work in breach of Sony’s copyright. After Sony issued a formal notice, Mr McFadden sought a declaration in which he argued that the liability privilege for access providers set out in the German legislation implementing the Directive freed him from any responsibility regarding the actions of his customers. The case worked its up way up to the CJEU.
The CJEU ruled that a person who makes a Wi-Fi network available to the general public, free of charge, in order to draw the attention of potential customers to the goods and services of a shop, constitutes an “information society service” for the purposes of the Directive. In order to benefit from the liability privilege pursuant to Article 12, it was necessary that the provider of the service satisfy each of three conditions:
- they did not initiate the transmission;
- they did not select the recipient of the transmission; and
- they did not select nor modify the information contained in the transmission.
Assuming these conditions are met, the access provider is to be deemed an intermediary not liable for compensation or any other costs related to the copyright infringement.
This did not mean, however, that a right holder was unable to seek an injunction from the national courts and demand the termination or the prevention of an infringement of copyright. The Court considered that an injunction could be secured by means of requiring the access provider to password-protect the Wi-Fi connection. This would enable a balance to be struck between the interests of the right holder, the access provider’s freedom to conduct business and the internet user’s freedom to information. In particular, such a measure would be capable of deterring network users from infringing intellectual property rights provided users were obliged to reveal their identify before going online to prevent them from sheltering behind anonymity to infringe copyright.
The Court’s attempt to strike a balance between the rights of right holders, on the one hand, and free internet access on the other, in particular the insistence upon the user disclosing their identity as a condition of access, is to be applauded. Operators will also welcome the result although they should note that they may be compelled to password-protect their networks and to seek to obtain the true identify of users of their network.
__________________________
[1] Directive 2000/31/EC

The new groundless threats regime
The Government has published the Intellectual Property (Unjustified Threats) Bill (the Bill) which, when implemented(most […]
The Government has published the Intellectual Property (Unjustified Threats) Bill (the Bill) which, when implemented(most likely next year) will reform the law on unjustified, or groundless, threats.
The phrase “groundless threats” refers to provisions in UK legislation which were originally introduced to provide a level of protection against threats of patent infringement. They have their origin in the nineteenth century, when persons (typically large companies) who claimed to be patentees, would threaten, often without justification, to initiate infringement proceedings against actual or potential customers of rivals in order to deter them from dealing with those rivals. In the absence of statutory assistance, it was difficult for the rival or the customer to bring any claim based on such a threat, even if it caused them serious loss. Legislation was enacted therefore to provide an aggrieved person with a remedy for groundless threats of patent infringement proceedings. This remedy has since been extended to trade marks, registered designs and unregistered designs, but not to copyright works.
The current position
The groundless threats legislation varies between the different IP rights. For patents, for example, section 70(1) of the Patents Act 1977 states “where a person (whether or not the proprietor of, or entitled to any right in, a patent) by circulars, advertisements or otherwise threatens another person with proceedings for any infringement of a patent, a person aggrieved by the threats (whether or not he is the person to whom the threats are made) may, subject to subsection (4) below, bring proceedings in the court against the person making the threats, claiming any relief mentioned in subsection (3) below”.
By contrast, section 21(1) of the Trade Marks Act 1994 states that an actionable threat arises “where a person threatens another with proceedings for infringement of a registered trade mark other than: (a) the application of the mark to goods or their packaging; (b) the importation of goods to which, or to the packaging of which, the mark has been applied; or (c) the supply of services under the mark”.
Mere notification that an IP right exists or is registered does not amount to a threat of proceedings. However, the provisions which support this have been very narrowly interpreted in the courts, so great care is required when drafting notification correspondence.
By definition, a claim cannot be brought if the threat is “groundless”. In other words, if the maker of the threat can prove that there has been or will be an infringement of valid IP rights, the party threatened will have no cause of action. A threat may be made orally or in writing and it will be viewed in the context of the correspondence or series of communications as a whole.
Any “person” making the threats can be sued. This could include not just the IP owner, but a licensee, user or anyone else, whether or not they have an interest in the IP right in question. Solicitors and other professional advisers who make threats on behalf of their clients can be sued.
Possible remedies include a declaration that the threats were unjustified, damages and an injunction.
The current regime provides that certain activities of an alleged infringer do not have protection of the groundless threats legislation. For patents the exceptions are making or importing a product or using a process; for trade marks the exceptions are applying the mark to goods or their packaging, importing goods bearing the mark and supplying goods bearing the mark; and for designs there is an exception for the making or importing of goods to the design.
The new regime
The Bill is an attempt to bring some consistency to this area of the law, introducing a regime that will be common to all the IP rights covered.
Under the Bill, there is a twofold test for determining whether a communication constitutes a “threat”: would the communication be reasonably understood to mean that (1) a right exists; and (2) someone intends to bring infringement proceedings in respect of that right for an act done in the UK. The same test will apply for patents, trade marks and designs.
The Bill provides that the aggrieved party may not sue the threatener for threats concerning “primary acts” or made to “primary actors”. Primary acts are specific to the IP right in question; for patents for example, it would be the incorporation or manufacture of a patented product or use of a patented process. These are the acts likely to cause the greatest commercial damage. By contrast, a secondary act could be the supply or retail of an allegedly infringing product. The Government is seeking to redirect the focus of the legislation away from secondary acts to primary acts. This is true of all IP rights covered by the groundless threats legislation, not just patents.
There is a safe harbour in the Bill permitting the rights holder to communicate with secondary actors without incurring liability provided certain conditions are satisfied. The Bill also provides that there is a defence if the threat is sent to a secondary actor because no primary actor can be found, despite “all reasonable steps” having been taken.
The Bill introduces new protection for professional advisers against claims for groundless threats, provided they are regulated by a regulatory body in the provision of services and are acting on their client’s instructions. Lawyers will obviously welcome the change but it may also benefit clients who won’t any longer have to pay for their advisers to use tortuous, unclear phraseology to avoid falling foul of the legislation.
The revised regime will also cover Unitary Patents and European Patents that come within the jurisdiction of the Unified Patent Court.
Next steps
It is possible that the Bill may undergo changes as it works its way through Parliament. We will keep you updated as to the Bill’s progress.

VOGUE and descriptiveness
The EU General Court has ruled on whether the figurative mark, VOGUE, registered as an […]
The EU General Court has ruled on whether the figurative mark, VOGUE, registered as an EU trade mark in respect of various beauty and baby care products in Class 3 was descriptive [1].
The Court upheld the conclusion of the EU Intellectual Property Office that the mark was not descriptive of the goods for either the average English or French-speaking consumer. “Vogue”, according to the Court, means “popularity, use or general acceptance” and “en vogue” (or “in vogue”) means “fashionable, tendency”. There was nothing in that definition that was descriptive of an essential characteristic or characteristics of the goods subject to the mark.
The Court also considered that the mark was not devoid of distinctive character for the relevant goods.
The Court rejected a further challenge to the mark based on bad faith, the allegation being that the proprietor of the mark had sought to register the mark in various Member States without any intention of using the mark. In dismissing this argument, the Court made the point that submitting an application for unitary protection as an EU trade mark beyond national registrations was not of itself an act of bad faith.
_______________________
[1] Case T-453/15, Trinity Haircare v EUIPO

Copyright in footage captured by members of the public
A New-York based photo journalist, Paul Martinka, is suing the publisher Time Inc (Time) for […]
A New-York based photo journalist, Paul Martinka, is suing the publisher Time Inc (Time) for copyright infringement. This follows the publication by Time of two photos of John Kasich, a former candidate for the Republican presidential nomination, eating pizza. Rather like the photographs of Ed Miliband wrestling with a bacon sandwich that emerged during the UK General Election campaign last year, the photos of Mr Kasich’ dining experience did him no favours whatsoever. Attempting to eat pizza with a knife and fork in New York is not a vote winner apparently.
As well as publishing the photos, Martinka maintains that Time features the photographs in a video that is stored on Time’s servers and which could be shared through social media platforms. They did so, allegedly, without Martinka’s consent.
Martinka is reported to be claiming statutory damages of up to $150,000 per work infringed and also statutory damages of at least $2,500 and up to $25,000 for each instance of false management of copyright information.
The practice of members of the public seeking to monetise video footage or photographs captured of newsworthy items – terrorist outrages, natural disasters and the like – appears to be gaining ground. We reported last year that the man who captured video footage of the shooting of an unarmed man by a police officer in South Carolina and which later went viral, subsequently sought €10,000 from news agencies for the reproduction of the footage. As a sign of the times, organisations now exist to help members of the public to license the copyright in their photos and videos to media outlets (they do not do so altruistically of course, they will expect a fee in return).
The Martinka case is slightly different in that Martinka is a photo journalist by profession but, in an age where we all carry smartphones with cameras, we can expect to see more disputes involving the copyright to images, still and moving, taken by members of the public.

Likelihood of confusion between Victor and Victoria
The EU General Court has upheld a decision of the EU Intellectual Property Office Board […]
The EU General Court has upheld a decision of the EU Intellectual Property Office Board of Appeal that there existed a likelihood of confusion between the word mark VICTOR, sought for registration as an EU trade mark in relation to sports clothing and retail services and a figurative mark incorporating the word “victoria” registered in Spain in relation to clothing. [1]
The General Court agreed with the Board of Appeal that there were visual, phonetic and conceptual similarities between the two signs and that the goods and services covered were partially identical and partially similar.
The Court rejected a submission that the proprietor of the “victoria” mark had not established use as the mark was not directly affixed or linked to the footwear. The Court said it was customary in the footwear sector for a trade mark to be affixed to the sole or inside of a shoe with the consequence that it was natural that the mark would not show on certain photos of the shoes. Further, according to settled case law, a connection between the mark and goods can be established without it being necessary for the mark to be affixed to the goods – the invoices, catalogues and advertisements used by the proprietor of the “victoria” mark enabled the necessary link between the mark and the goods to be established in this case.
________________________
[1] Case T-204/14, Victor International v EUIPO (VICTOR)

Changes to the UK Patent Rules
The UK Intellectual Property Office (UKIPO) has published details of amendments to the Patent Rules […]
The UK Intellectual Property Office (UKIPO) has published details of amendments to the Patent Rules 2007. The majority of the amendments came into force on 1 October 2016, with the remainder scheduled to come into force on 6 April 2016.
The principal changes from 1 October 2016 are as follows:
- The UKIPO will issue a new “notification of intention to grant” letter. This will provide applicants with clarity as to the time left to take any action before grant of the patent, in particular the time scales for the filing of any divisional patent applications (which cannot be filed after the grant of the patent).
- There is a relaxation of the requirements for formal drawings. From 1 October 2016, shadings in drawings may be included, provided they are clear. The previous requirement was that drawings must comprise black lines and must not be shaded.
- The filing of voluntary amendments to international patent applications are explicitly allowed up until the date of issue of the first UK examination report. The applicant must, however, wait until the first search report is issued on the application. As this will usually be before national entry phase, voluntary amendments can be filed on entry into the UK national phase.
The principal change from 6 April 2017 is the allowability of omnibus claims. These are claims that appear at the end of claim set and generally claim the invention by reference to the description or drawings. Under the new rules omnibus claims will only be allowed if “the technical features of the invention cannot otherwise be clearly and concisely defined using words, a mathematical or chemical formula or any other written means”. This brings the UK into line with the European Patent Office, which only allows omnibus claims where they are absolutely necessary.
Please contact us for further details on these and the other changes to the Patent Rules 2007.