Intellectual Property

Trade Mark Reform Package Approved by EU Parliament in December 2015 

The European Parliament has approved a trademark reform package on 15 December 2015 (Regulation No. 2015/2424). The package introduces significant changes that aim at modernizing the European trade mark system and making trademark protection quicker, cheaper and more reliable. The most important changes touch upon matters such as fees, class headings as well as the representations of trademarks. Most of the changes come into effect on 23 March 2016. 

The new Regulation updates the name of the office as well as that of the trademarks. This means that the Office for Harmonization in the Internal Market (trademarks and designs), i.e. OHIM will become the European Union Intellectual Property Office (EUIPO) and the Community Trademarks (CTMs) will in the future be called European Union Trade Marks (EUTMs). 

What is significant for applicants is that the fees will be reduced. Especially the renewal fees will be significantly lower. Also, as from 24 September 2017, the requirement for graphic presentation will be removed from the registration process, which makes it easier to register non-traditional trademarks, such as sound. This means that in the future, available technology can be used for representing the mark. Also registration of guarantee or certification marks will be possible starting from 24 September 2017. 

However, probably the most relevant change is the amendments that can be made to goods and services of those CTM registrations filed before 22 June 2012. This derives from the crucial IP TRANSLATOR case of EUCJ (C-307/10), which ruled on the literal interpretation of the class headings of the Nice Classification, i.e. that only the goods and services specifically listed in the registration are covered. There will be time window of 6 months during which the owners of the CTM registrations dating from before the mentioned date and covering whole class headings are allowed to amend the goods and services so that they cover what they truly were intended to cover. After the 6 month transition window, the trademarks cover only precisely the goods and services that are listed. Thus, the trademark owners having registrations from before the mentioned date should evaluate and amend their coverage accordingly. 

There is also a long list of other amendments that will enter into force with the reform package, for example that it will be possible to base an opposition on protected designations of origin and protected geographical indications. 

The trade mark reform package also repeals the Directive 2008/95 by a new Directive 2015/2436 that updates the national trade mark systems of the Member States. The new Directive has to be implemented into national laws by 14 January 2019.

Court of Justice of the European Union Rules on the Scope of the Right of Communication to the Public in the Context of Broadcast Transmission by "Direct Injection" 

In a recent ruling, the Court of Justice of the European Union ("CJEU") shed light on the scope of exclusive rights conferred by copyright in the context of broadcasting in a dispute between Belgian copyright administration society SABAM and a Dutch commercial broadcasting organization SBS (Case C-325/14). The judgment outlines how the use of a broadcasting technique called "direct injection" should be assessed in light of the exclusive right of communication to the public secured to authors in Directive 2001/29/EC ("Information Society Directive"). The CJEU found that the transmission of a signal from a broadcasting organization to a distributor via a private line is generally not considered as communication to the public, owing to the fact that the distributors involved in that constellation do not constitute the public.

Under the existing practice, it was clear that the transmission of a broadcast from a distributor to its subscribers generally constitutes communication to the public. This was not disputed in the case at hand. However, SABAM suggested that in a transmission via the direct injection method, in which a transmission is passed from a broadcasting organization to a distributor and then onwards to the distributor's subscribers, also the broadcasting organization is making a communication to the public. Accepting this interpretation would mean that fair compensation for the use of a copyrighted work could be claimed directly from the broadcasting organization.

Ultimately, the CJEU did not share SABAM's position. The CJEU noted that while a transmission from a broadcasting organization to a distributor certainly constitutes an "act of communication", it is directed to specified individual distributors, not the "public". Thus, the latter of these cumulative elements required for a "communication to the public" remained unfulfilled. However, the CJEU allowed one concession to its conclusion, stating that the outcome could be the opposite if intervention by a distributor was only deemed a technical means of ensuring or improving reception of the transmission by the broadcasting organization. Nonetheless, the CJEU's conclusion is framed so as to suggest that the main rule is that a broadcasting organization does not make a communication to the public when transmitting a signal to selected distributors via direct injection.

Data Privacy

European Court of Human Rights Judgment in Bărbulescu v. Romania – a More Balanced Approach to the Monitoring of Employee Emails? 

In its judgment (Bărbulescu v. Romania; Application no. 61496/08), the European Court of Human Rights (''Court'') assessed the relationship between the right to respect for private life and the interests of employers in ensuring that employees complete their tasks during working hours. The case concerned a Romanian employee whose employer dismissed him after he had been found using his work-related email for personal communication during working hours. 

The Court noted that the employer had accessed the employee's email account in the belief that it contained professional messages, because the company's policy contained a ban on the use of company email accounts for private correspondence. The Court indicated that if prior notice on the acceptable use of employee emails had been given, this would negate the employee's reasonable expectation of privacy. As for the monitoring itself, the employer's decision to terminate the employment was not based on the actual contents of the communications. Since no other data or documents besides the email communications were accessed, the Court found that the employer’s monitoring was both proportionate and limited in scope. The Court noted that the employer had used its disciplinary powers provided by national law. Accordingly, the Court ruled that there was no violation of the employee's human rights and freedoms.

While this decision is based on specific facts, it does raise interesting issues in relation to the fundamental rights of both employees and employers. However, national laws on employee monitoring and accessing of employee e-mails vary significantly within the EU, and it is important to note the Court's judgment does not directly change those laws. For instance, Finnish law is very strict on the protection of the employees' rights in this context; as a main rule, employers have no general right to access employee emails or to conduct any monitoring based on email traffic. It remains to be seen whether legislators will now reconsider how to balance employees' and employers' interests in light of this particular judgment. 

For further information on the interplay between employee privacy and employers' rights in the context of protecting trade secrets, see our previous article on the subject.

Time to Take Action – Transitional Period for EU-US Transfers Expired

Roschier published a briefing note in October 2015, discussing the significance of the ruling of the Court of Justice of the European Union, Maximillian Schrems v. Data Protection Commissioner (C-362/14), invalidating the so-called Safe Harbor Agreement on which a vast number of companies have based their transfers of personal data to the US. National data protection authorities within the EU announced in October that they allow companies a transitional period till 31 January 2016 during which time enforcement actions are not executed. 

Many companies were in the belief that a new agreement would be reached in the EU and US negotiations before said period expired, but unfortunately this was not the case. Although "Safe Harbor 2.0" negotiations are still pending, the expiry of the grace period means companies who have previously relied upon the Safe Harbor regime in data transfers to the US need to implement alternative legal basis for their data exports, for instance by adopting EU Model Contract Clauses. 

In both Finland and Sweden the relevant Data Protection Authorities have so far principally operated through guidance and advice, but it should be noted that the current laws also equip the authorities with more significant measures, such as administrative (conditional) fines and criminal sanctions. Data Protection Authorities in other EU jurisdictions may be even more prone to use stricter measures to ensure compliance, such as issuing considerable fines for illegal cross-border transfers.

Life Science

Legislation Concerning Pricing Practices of Medicinal Products Amended in Finland 

The amended Health Insurance Act (21.12.2004/1224) and Medicines Act (10.4.1987/395) entered into force on 1 January 2016. The amended Health Insurance Act introduces provisions concerning, inter alia, the adjustment of original products' maximum wholesale process and entering of regulation concerning pricing practices of generic products. Said provisions tightened the regulation concerning pricing practices of medicinal products in favor of generic products.

According to the regular pricing policy of the Pharmaceuticals Pricing Board, a reasonable wholesale price for a generic product has been approved in case it consists of maximum 60% of the price of the equivalent product. A new provision concerning confirmation of reasonable wholesale price for a new generic product has been added to Chapter 6 of the Health Insurance Act. According to the new Section 7a, the reasonable wholesale price for a new generic product can now principally be approved to be maximum 50% of the wholesale price accepted for an equivalent product. By virtue of the generic substitution system, lowering the standard for reasonable wholesale price affects the price development of the original products.

A new provision concerning reduction of maximum wholesale price for medicinal products was included in the Chapter 6 of the Health Insurance Act. In accordance with the new Section 22a, the Pharmaceuticals Pricing Board reduces granted maximum wholesale prices for medicinal products included in reference price groups at the beginning of the following fourth quarter year after the reference group has been formed. Said reduction of maximum wholesale prices concerns medicinal products whose maximum wholesale price is higher than the highest confirmed maximum wholesale price of a generic product included in the reference price group.

In addition, Section 57 of the Medicines Act requires that consumers are provided with information concerning the currently cheapest medicinal product while consulting of prescription. The purpose of the said addition is to increase the price knowledge of consumers and the competition in the pharmaceutical market. 

Marketing & Consumer

Consumers Must Be Informed of Competent Dispute Resolution Body in a Clear Manner in Finland 

Due to a recent amendment of the Consumer Protection Act, Companies must now inform consumers of a competent out-of-court dispute resolution body as well as the website address of such dispute resolution body. The information should be provided both on companies' websites and in their standard terms and conditions. The obligation follows from the Alternative Dispute Resolution Directive and has been in force since 9 January 2016. 

To comply with the aforementioned, it is sufficient, for example, to indicate in which situations alternative dispute resolution is used in addition to stating the name and the website address of the dispute resolution body in question. It is important that the information is provided with the consumers is a clear manner. In Finland, the respective dispute resolution body depends on the sector of the company, it most likely being the Consumer Disputes Board. 

The Finnish Market Court Rules on Comparative Advertising Conducted by Elisa 

In a recent case (MAO 895/2015) involving two of the largest telecommunications companies in Finland, the Finnish Market Court (''Court'') assessed the concept and requirements of acceptable comparative advertising. Following a lawsuit initiated by TeliaSonera Plc. ("TeliaSonera"), the Court prohibited Elisa Plc. ("Elisa") from using expressions "No stupid data limit", "Without a stupid data limit", "Never a stupid data limit" and "How stupid is subscription with a data limit" or any other similar expressions while marketing its mobile phone and mobile broadband subscriptions.

Firstly, the Court noted that in order to be considered comparative in nature as defined in Section 2a of the Unfair Business Practices Act, it is sufficient that the advertisement refers, either explicitly or by implication, to a competitor or goods offered by it. However, it is irrelevant when referring to certain feature of a product whether a specific competitor or its goods may be identified as actually being referred to. Based on this, Elisa's advertisements were considered comparative advertising. According to the Court, the fact that Elisa's product portfolio included also broadband subscriptions with data limit was irrelevant as the advertised goods themselves did not include data limit.

Secondly, the Court concluded that referring to data limit with a strong negative expression “stupid”, while not providing proof of the reliability of such statement, could not be regarded as expression of general opinion on data limit as a feature or as demonstration of the benefits of advertised products. Further, as the campaign in question had presented other competing goods with data limit as somehow inferior in quality, it was considered degrading and disparaging, thus not meeting the requirements of acceptable comparative marketing. The Court also clarified that the use of humor as an effect is permitted in general, with the exception of cases where it creates an impression contrary to good business practice.

The conclusion from the ruling is that reference to a certain feature of a product can be considered comparative advertising even if it does not refer to a specific competitor or specific products offered by a competitor. Moreover, companies should be cautious in using negatively charged marketing expressions, which present goods of its competitor in negative light, especially when not providing any proof supporting such claims.

The judgement is not final as the period for appeal expires on 15th of February. 

Media & Entertainment

The Swedish Supreme Court: Sports Broadcasts Are Not Protected by Copyright 

The Supreme Court ruled in case B 3510-11 that the placing of a link on a website that gives public access to watch sports events on another, payment wall protected website does not constitute copyright infringement.

The defendant, "LS", was charged for copyright infringement and the prosecutor alleged that LS, at two occasions, had infringed C More Entertainment AB's ("C More") copyright to broadcast ice hockey games by placing a link on his website to C More's live broadcast on a web television (pay per view), and by this action sidestepped the payment wall. According to the prosecution, LS had also infringed C More's ancillary rights to motion pictures and replays included in the broadcasts.

The District Court ruled in accordance with the prosecution. However, the Court of Appeal only sentenced LS for infringement of the ancillary rights to the replays. C More appealed, and the legal issue before the Supreme Court was whether LS was also guilty of copyright infringement. C More claimed that the result of the work of commentators, picture producers and cameramen in connection with the broadcasts were protected by copyright, both for each individual performance and the broadcasts as whole.

The Supreme Court begun by stating that LS's actions constituted a "transmission to the public" of the broadcasts. According to the Supreme Court, copyright protection for television broadcasts requires that the content of the broadcasts goes beyond than what is provided by the conditions followed by the game. The content must be the result of an "own intellectual creation" in order to meet the requirement of "originality".

The Supreme Court stated that the performance of the commentators, picture producers and cameramen had mainly been driven by the events of the game, which is the central part of the broadcast. Even though there had been some alternative ways of performance, and the fact that the broadcasts had some graphic elements, the result was not considered as an "own intellectual creation". Thus, the broadcasts were not, partially or as whole, protected by copyright. The judgement by the Court of Appeal regarding LS's infringement in the ancillary right to the replays remained unchanged. Two justices had a dissenting opinion and stated that the broadcasts should be considered protected by copyright. 

In Brief

European Trade Secret Directive One Step Closer into Becoming Reality 

The Luxembourg Presidency has on 15 December 2015 reached a provisional agreement on the contents of common rules for the protection of trade secrets and confidential information of EU companies. The agreement was confirmed by the Committee of Permanent Representatives of the Council on 18 December 2015 and will be implemented in the form of the new directive on trade secrets. There are some key points arising from the new directive. The employees' use of skills honestly acquired in the normal course of employment does not fall under the directive and is left for the Member States' laws to govern. During trials, at least one natural person from each of the parties as well as their lawyers or other representatives shall have access to the trade secret materials. The limitation period for bringing claims will be six years. The European Parliament will vote on the directive during 2016 after which the Member States then have two years to implement the changes. 

Agreement Found on EU Data Protection Regulation 

Following the final negotiations between the Commission, the European Parliament and the Council, an agreement on the content of the data protection reform was reached on 15 December 2015. The Permanent Representatives Committee (Coreper) confirmed the compromise texts agreed with the European Parliament on 18 December 2015. The data protection reform was put forward by the Commission as part of its digital package in January 2012. The final text of General Data Protection Regulation will be formally adopted by the European Parliament and the Council at the beginning of 2016. The new rules will become applicable two years afterwards. Roschier has published a briefing note discussing some of the most significant changes by EU Data Protection Regulation in December 2015. 

Finland Ratifies the Agreement on the Unified Patent Court 

Finland completed the final step required for ratification of the Agreement on the Unified Patent Court ("UPC") on 19 January 2016. Finland is the ninth EU Member State to complete the said step, other contracting Member States being Austria, Belgium, Denmark, France, Luxembourg, Malta, Portugal and Sweden. The Agreement on the UPC enters into force when it has been ratified by at least 13 Member States, which must include the UK and Germany in addition to France. Disputes over European patents with unitary effect and European patents will be litigated by the UPC in the future.