New EU-wide tool to aid fight against IP piracy and counterfeiting
A new tool has been launched to strengthen the ties between IP owners and police and customs agencies. The aim is to make it easier for the enforcement bodies to intercept counterfeit goods and to help with the fight against piracy.
The Enforcement Database allows brand owners to
upload information to a central database to which
customs and police across the EU have access. The tool
is free to use and the only requirement for an account is
a registered trade mark or design in the EU (Communitywide or national rights are acceptable).
In addition to details of the registered IP right, brand
owners can deposit any additional information that they
think may assist officials in assessing whether suspect
items are fake or genuine. This could include pictures
of genuine products, information on key identifiers and
packaging samples, as well as contact details and
previous cases: essentially anything brand owners think is
relevant and useful. Any information will be translated into
the official languages of the EU.
The Database also allows brand owners to electronically
complete and file Applications for Action and will even
automatically complete the AFA with relevant rights. This
should speed up the process of authorising customs
officials to take border action.
This tool has the potential to be a valuable asset to brand
owners, but success will depend on as many right holders
as possible registering, so enforcement officials come to
see it as a first port of call. At present, the database is
in a pilot phase but it is expected to go live in April 2014,
with access rolled out to various agencies from that date
(Europol, for example, is expected to have access from
November this year).
New consumer rights for digital content
The Consumer Rights Bill, the most wide ranging
reform of consumer law in decades, has been laid
before Parliament. The Bill consolidates the majority of
UK consumer law relating to the sale of goods, supply
of services and unfair contract terms. It also includes
specific, new provisions for the supply of digital content,
defined as data produced and supplied in digital form.
Digital content includes software, music, computer games
and applications or “apps”. The new provisions will apply
to all paid-for digital content, content which is supplied
free alongside paid-for content and content paid for with
a facility, such as a token, virtual currency, or gift voucher,
that was originally purchased with money. In addition, the
Bill introduces easier routes for consumers to challenge
anti-competitive behaviour and consolidates enforcers’
powers to investigate potential breaches of consumer law.
New consumer rights for digital content
continued overleafStrained relations in the
UK yoghurt market
The Court of Appeal has ruled that yoghurt sold in the UK labelled as
‘Greek yoghurt’ must be made in Greece.
The Court of Appeal (FAGE UK v Chobani UK Ltd) upheld last year’s
ruling that Chobani could not call its US-produced yoghurt ‘Greek
yoghurt’ because it was not made in Greece. FAGE brought a
successful action for extended passing off (a form of passing off
developed to protect collective goodwill in relation to classes of
goods e.g. Champagne) having satisfied the judge that it had built
up substantial goodwill in the term ‘Greek yoghurt’. Chobani’s use
of the term for yoghurt made outside Greece caused or would cause
substantial damage to that goodwill.
Due to a UK labelling convention, from the mid-1980s until Chobani’s
entry into the market in 2012 all ‘Greek yoghurt’ sold in the UK had
been made in Greece and rendered thick and creamy by straining. The
appeal judges decided that a substantial proportion of the relevant
public was likely to be deceived by Chobani’s use of the term; this was
a material misrepresentation and FAGE was entitled to a permanent
injunction restraining Chobani. The labelling convention had led to a
widespread belief among buyers of Greek yoghurt that their yoghurt
came from Greece, and this belief matters to those buyers. Importantly,
although the name may have started as purely descriptive, it had built
up a reputation such that it had become distinctive.
This ruling demonstrates the importance of vigilance in protection
of intellectual property - Kitchin LJ noted that each product which
is allowed to trespass on a company’s intellectual property without
challenge potentially weakens any future attempt by that company to
restrain other such attempts.
The new quality rights for digital content are very similar to those for
tangible goods under the Bill and so should not come as a surprise for
business. Digital content will have to be of satisfactory quality, fit for
purpose, meet any description and not cause damage to a consumer’s
device or other digital content. The Bill also provides that it will be
implied that traders have the right to supply the digital content. The
remedies which the Bill provides for digital content are similar to those
for tangible goods but with differences to reflect its intangible nature.
For breach of the quality rights, the available remedies will be repair
or replacement where practical, money back (up to the full amount)
where repair or replacement is not practical, repair of damage (or
compensation) if digital content damages a consumer’s device or other
digital content, and refund if the trader sold digital content without the
right to do so. Under the Bill, as currently drafted, the quality rights and
corresponding remedies cannot be excluded.
The Bill was published in June 2013 for pre-legislative scrutiny, with
the BIS Select Committee publishing a report before Christmas
containing recommended amendments. A revised version of the Bill
was introduced to Parliament on 23 January 2014. There is a lot of
interest from MPs in the Bill and on its second reading at the end of
January there was a lively Commons debate. The next stage for the Bill
is the Commons Committee which will report in March. While the Bill
is unlikely to come into force before 2015, businesses supplying digital
content should be aware that changes to terms and conditions are likely
to be needed and should make sure they are prepared in good time.
IP Bill – update
In late January 2014 the IP Bill completed its second reading of
the IP Bill and the committee stage where the House of Commons
deliberated the finer details of the proposed Bill. The Bill will now
progress to the report stage, and then onto the third reading at the
House of Commons, dates to be announced.
The Bill was introduced in the House of Lords on 9 May 2013 with
a stated purpose to “make it easier for businesses to protect their
intellectual property rights”.
The main proposals in the IP Bill are as follows:
Criminal sanctions for registered design right
Amendments to UK design right law
Designs Opinion Service
Amendments to patent law, relating to the implementation of the
Unified Patent Court (UPC).
Criminal sanctions for design rights were highly debated as there were
campaigns to introduce criminal sanctions for unregistered rights in
addition to registered rights. However, it was agreed that sanctions
should only be introduced for registered rights, and restricted to
copying which is done “knowingly and in the course of business”.
A number of UK Design Right law proposals have been suggested in order
to bring UK law in line with EU Design right law, which will streamline and
assist in a more consistent approach from the UK and EU.
Similar to the patents opinion service in the UK, proposed amendments
have been made to implement a designs opinion service, to be able to
provide non-binding decisions on design right infringement matters.
Finally, suggested amendments within the Bill allow, in principle, for the
UPC to be implemented. Using a black and white trade mark in colour
may impact on UK opposition proceedings
The UK Intellectual Property Office (IPO) has issued guidance on how
is the scope of a trade mark owner’s rights are affected if it registers
a trade mark in black and white, but uses it in one particular colour or
Tribunal Practice Notice (TPN) 1/2014 has been issued in response
to the decision of the Court of Justice of the European Union in
Specsavers v Asda (C-252/12). In that case, the Court found that
where a trade mark is not registered in colour, but has been extensively
used in a particular colour or colours, then the colours in which a third
party uses an allegedly infringing sign are relevant when assessing the
likelihood of consumer confusion.
The TPN confirms that where colour is shown to be part of the
distinctive character of the earlier mark, even though it is registered in
black and white, then the potential use of the later, opposed mark in
that same colour or colours is a relevant factor. This is also the case if
the opposition claims the later mark will take unfair advantage of the
earlier mark’s reputation.
By contrast, evidence that the opposed mark has been used in colours
different to those for which the earlier mark is known is not relevant. The
IPO must consider all potential uses.
The TPN also states that colour is not a consideration when either the
earlier black and white registration has not been used in colour, or it
is not established that any use in colour forms part of the distinctive
character or the mark. In that scenario, the IPO will straightforwardly
compare the mark as registered against the mark as applied for.
In light of this, trade mark owners who intend to use colour as a key
distinguishing feature of a new logo should consider applying in colour
(perhaps in addition to black and white) to ensure that feature is taken
into account in any IPO proceedings from the outset, without the need
New guidance from ICO on privacy in app design
Prompted by the ever increasing use of smart mobile devices and
apps, the ICO has published guidance for app developers setting out
questions that they should be considering during the development
cycle and the relevant requirements under the Data Protection Act
(DPA). It aims to increase developers’ knowledge of data protection and
compliance with the DPA to ensure users’ privacy.
Although the primary focus of the guidance is mobile apps, it is equally
applicable to any app on any device.
In summary, the guidance:
clarifies which types of data collected by apps will be personal data
highlights for different types of app who will have ultimate
responsibility for providing adequate protection for personal data
(i.e. who will be data controller)
reminds data controllers of the need to provide contact details
recommends collecting and processing only the minimum data
states that users should be able to permanently delete their
encourages carrying out a privacy impact assessment when
planning an app
offers some practical suggestions for giving users access to an
states that privacy information should be available as soon as
recommends ‘just-in-time’ notifications for collection of more
intrusive data (e.g. location data)
reminds developers to consider whether the app will pass data on
to third party organisations, and whether they have informed users
suggests that users are given granular choices for privacy settings
and are able to easily alter their preferences in the app
reminds developers that encrypted connections should always be
used for transmitting sensitive information.
A more detailed report on this subject appears on the Intellectual
Property section of our website.When does a magazine for vehicle owners infringe the vehicle
manufacturer’s trade mark? Bauer has been producing Land Rover
Owner International magazine since 1987. In 2010, it applied to register
the following trade mark for various goods and services:
Land Rover challenged the application on the basis of its earlier rights in
the LAND ROVER name, arguing that:
there was a likelihood of confusion on the part of the public; and/or
that it would take unfair advantage of, or harm, the reputation of
those earlier marks.
Both sides provided evidence. The UK Office found that there was
indeed a likelihood of consumer confusion. However, Bauer’s long term
use of its mark concurrently with Land Rover meant that it had acquired
its own distinctive character in respect of magazines relating to motor
land vehicles and annual motor vehicle shows. This was supported
by evidence that Land Rover could not have believed there to be a
significant risk of confusion (including Land Rover’s CEO opening shows
put on by Bauer under its mark).
Land Rover’s opposition was successful, however, in respect of goods
and services for which Bauer did not demonstrate use.
Land Rover’s arguments in respect of reputation took it no further as
there was no suggestion that the economic behaviour of Land Rover’s
customers and potential customers had been changed. Therefore no
detriment had been caused.
Additionally, there was a symbiotic relationship between the parties,
whereby Land Rover benefited from the additional promotion of its
products and Bauer benefited from trading in products that rely on
the Reputation of Land Rover. Any advantage obtained was not,
In any event, due to Bauer’s long concurrent use of the mark, the
defence of “use with due cause” would be available.
The outcome is an interesting example of the honest concurrent use
defence and an illustration of the potential pitfalls where brand owners
let others use similar marks without challenge.
Clash of Land Rovers
Cyber-security in Corporate Finance
The Rt Hon David Willetts MP, Minister for Universities & Science,
has launched a guide entitled “Cyber-Security in Corporate Finance”
(the Guide), produced by the Government taskforce established to
help companies to deal with the growing cyber-security threat from
organised crime networks, nation states, ‘hacktivists’ and employees
The Guide urges companies to make cyber-security a higher priority,
particularly during corporate finance transactions where the large
volumes of information shared amongst a host of different advisers and
financiers makes for a potentially attractive opportunity for criminals
and competitors alike to exploit weaknesses in cyber-security. Whilst
many of the recommendations in the Guide will already be adopted
by organisations as a matter of good practice, by exploring the key
practical questions and making associated suggestions for each stage
of a potential transaction, the Guide acts as a helpful reference for
informed cyber-risk management in corporate finance transactions.
The key messages in the Guide include:
ensuring that confidentiality agreements are in place with all
relevant third parties
limiting the number of individuals that are involved in the potential
transaction (both internally and externally) and considering the
necessity of all data flows
mapping out information and process flows and considering
separating internal data stores from usual IT systems, as well as
reviewing current working practices and access to information
(physical and digital)
considering due diligence options (including the forum, the provider
and whether any additional security features are required)
monitoring access to information as the transaction progresses
assessing the security measures adopted by counterparts
(particularly targets) in any transaction as part of due diligence
considering whether the use of social media (both “official” and
“unofficial”) and other public announcements increases the risk
profile (for example to possible “phishing” attacks)
The full publication can be accessed at: http://www.icaew.com/~/
media/Files/Technical/Corporate-finance/Corporate-financefaculty/tecpln12526-cyber-web.pdf.Three UK-resident individuals issued a claim against US-based
Google for misuse of their private information and breach of statutory
duties under the Data Protection Act 1998 by tracking and collating
information relating to their internet use on Apple’s Safari browser
(bypassing Safari’s user privacy settings in the process) without their
knowledge or consent (Vidal-Hall and others v Google Inc).
In this way Google obtained and collated information including internet
surfing habits, physical and mental health, sexual interests and financial
situation. Advertisers could choose from labelled interest groups when
selecting who to display their adverts to. The claimants’ case is that
the targeted ads shown on their screen could have disclosed sensitive
information about them, and this has caused them to suffer distress and
After the claim was issued, Google challenged the permission to serve
it on them in the US. In refusing Google’s application, Tugendhat J
considered the requirements in the Civil Procedure Rules (CPR) for
service outside of the jurisdiction and concluded that (i) the claimants
had a good arguable case that fell within the (CPR) ground relied on; (ii)
there was a serious issue to be tried; and (iii) England is the appropriate
forum to try the dispute.
The Judge’s conclusions on various aspects of data protection and
privacy were particularly interesting. He held that:
Misuse of private information is a tort within the meaning of CPR
The damage alleged did not have to be economic or physical;
damage in this context could mean damages for distress
The definition of “personal data” within the meaning of the DPA
could be extended to include information that does not expressly
identify the user (e.g. a cookie containing a unique ID for each
If it goes to trial, this case will be watched closely both by those who
are worried about online privacy and by online advertisers, as well as
practitioners in privacy and data protection law.
Game over for console
Can Google use your
search history to market
As reported in the previous edition of Concept, the CJEU has now
given its ruling on the extent to which protection should be given to
the use of technological measures to prevent the misuse of copyright
The case (C-355/12) concerns proceedings brought by Nintendo
against PC Box, a company which markets equipment that can be
fitted to Nintendo’s hardware. Nintendo argued that this equipment,
which disables technical prevention mechanisms (TPMs) employed
by Nintendo within its videogames and consoles, allows illegal copies
of games to be used. PC Box defended its products, saying that it
was actually intended to enable users to ‘fully use’ their consoles by
allowing MP3 files, movies and videos, produced independently of
Nintendo, to be read.
The Court firstly clarified that videogames are capable of protection
under the Copyright Directive (2001/29/EC) rather than the more
limited Computer Programs Directive (2009/24/EC) and that TPMs are
capable of being viewed as an “effective technical measure” for the
purposes of Article 6(3) of the Copyright Directive. This means that the
protection which is applied to copyright works should extend to TPMs
which are used to prevent circumvention of this protection.
However, the Court stated that protection will only be given to TPMs
which pursue the objective of preventing or eliminating the infringement
of copyright and should not go any further in doing this than is
necessary. Specifically the TPMs, “should not prohibit devices or
activities which have a commercially significant purpose or use other
than to circumvent the technical protection.”
This case has now been referred back to the Italian Court which
originally requested the CJEU’s ruling, and evidence will be required
to show how the equipment marketed by PC Box is used in practice.
The Court will also need to look at whether other measures would
be available which provide comparable protection but cause less
interference with legitimate activities of third parties.
Whilst rights owners will be comforted by the availability of protection
to measures designed to prevent misuse of their copyrighted works,
there may be some concern that such measures will be required not to
inhibit their hardware being put to uses other than those for which they
were originally produced.
Amazon’s core business model falls
foul of trade mark law
To what extent can consumers using a trade mark to search for
products be directed to competitors’ products?
In Cosmetic Warriors Ltd and Lush Ltd v Amazon.co.uk Ltd 
EWHC 181 (Ch), the High Court has revisited the perennial issue of
third parties using registered trade marks to trigger sponsored ads in
search engine results. The case also considers the issue of trade marks
entered into retailers’ search engines throwing up competing goods.
In summary, the Court found that sponsored ads which did not
themselves include the trade mark searched were not an infringement.
Ads which did reproduce the mark, and the uses made of the mark by
Amazon on its own website did, in the main, infringe.
Alleged infringing acts
Lush manufactures cosmetics under the LUSH brand and owns a
Community trade mark registration for LUSH. The company does not
allow its products to be sold on the Amazon website, believing that Lush’s
ethical policies and philosophies are not consistent with those of Amazon.
In this case, Lush complains of three distinct uses of its trade mark:
1. Typing “lush” into (eg) Google results in the consumer being
presented with a sponsored ad including the words “Lush Soap at
Amazon” and a link
2. Typing (eg) “lush cosmetics bath bomb” into Google brings up
a sponsored ad that includes words such as “Bomb bath at
Amazon” and a link. The word LUSH does not appear in the ad.
3. Typing “lush” into the search box at amazon.co.uk will either
autocomplete to (eg) “lush cosmetics” as a link, or you can type
the word lush. Both instances resolve to a set of competing
products, none of which are Lush cosmetics.
When the links at 1 and 2 are clicked on, or the search results in 3
are shown, there is no overt statement that Lush cosmetics are not
available to buy at Amazon, just a set of competing products.
First class of infringement
These advertisements appear because Amazon has purchased LUSH
as an AdWord. European case law (Google France) has established
that purchase of a key word constitutes use in the course of trade in
relation to goods/services. All that is in question is whether one of the
functions of the trade mark is adversely affected by that use.
Here, the ad includes the word LUSH and clicking on the link in
the ad leads the consumer to the Amazon website and a set of
The judge found that the average consumer cannot tell without
difficulty that the goods to which it is directed are not those of Lush.
Consequently, there is an infringement of Lush’s trade mark.
Second class of infringement
In this case, LUSH does not appear in the sponsored ad. Consumers
are used to seeing sponsored ads from competing suppliers and in this
scenario, Amazon is “just another supplier offering similar products”.
There is no infringement.
Third class of infringement
The thrust of Amazon’s argument in this case was that the consumer
is in charge of the search and what is typed in. Lush is seeking to
stifle competition by taking that control away and IP rights should
not “unduly interfere with the basic right of the public to access
The judge countered that that right “does not go so far as to ride
roughshod over intellectual property rights, to treat trade marks such
as LUSH as no more than a generic indication of a class of goods in
which the consumer might have an interest”.
The judge agreed that the mere act of the consumer typing in the word
LUSH into Amazon’s search box could not be an infringement, as Amazon
has no control whatsoever over that activity. All the other instances
complained of do, however, constitute trade mark infringement:
1. Amazon will autocomplete “lu…” with, for example “lush bath
bomb” presented as a link for the consumer to click through to a
set of results.
2. If LUSH is typed in, the word “Lush” appears again below the
search box and above the results presented by Amazon.
3. Amazon offers related search results below the search box (ie
“other people searched for…”), such as “lush bath bombs”, again
presented as a link.
In all of these cases, the average consumer could not, without difficulty,
ascertain that the goods to which it was directed did not originate
with Lush. The judge held that Amazon was using Lush as a generic
indicator of a class of goods, damaging the mark’s ability to indicate
the origin of products.
Likewise, the attraction ability of the mark is affected if Amazon uses it
to direct to third party goods (the advertising function). In addition, Lush
has invested in a reputation for ethics which could be damaged by (for
example) Amazon’s tax policy (the investment function).
This case provides helpful guidance as to the extent to which retailers
and competing businesses can use registered trade marks as a
shortcut to steer consumers towards alternative buying options and the
extent to which right holders can legitimately object to such use.Patent Update: Virgin Atlantic and
Zodiac Seating in Court again
In December’s Court of Appeal judgment in Virgin Atlantic Airways
v Zodiac Seats (Ltd) and others marked another decision in this
long-running patent dispute. The ruling follows the Supreme Court
decision in the parallel case Virgin v Zodiac  UKSC 46. Our
comments on the parallel case can be found in the August 2013
Intellectual Property briefing.
By way of brief background, Virgin Atlantic brought proceedings
against seat manufacturers, Zodiac and others, alleging that Zodiac
was infringing three patents that were part of Virgin’s lie-flat upper class
One particular patent (known in the case as 908) was registered
and subsequently amended at the EPO but, due to an error, the
UK was included in the designated country list, contrary to Virgin’s
application. Zodiac argued that the patent was not designated in
the UK and was therefore invalid (in the UK at least) and that it was
not infringed in any event.
The parties ran a number of parallel claims which culminated in a
return to the Court of Appeal. Virgin appealed the decision of noninfringement at first instance on Patent 908 and Zodiac appealed the
designation point (that it lost at first instance) on rather novel grounds
- namely the European Convention on Human Rights (Articles 1 and
6). Zodiac accepted that it could not challenge the designation directly
under the Patents Act.
The English Court therefore had to determine whether it had jurisdiction
to rule on a European patent designation based on human rights law.
The Court upheld previous case law that the English Court does not
have power to rule on the validity of patents granted by the EPO on
grounds not specified in the European Patent Convention. However,
the Court upheld that Patent 908 had not been infringed by Zodiac.
Patent 908 was therefore valid but not infringed.
The case confirms the importance of the EPO for patent holders. Once
the EPO has granted a patent, purely procedural challenges to the
patent in the English Courts are not going to be successful.
Changes to the
The technology transfer block exemption regulation
(“TTBER”) provides a framework for assessing
whether technology agreements contravene European
competition law, primarily the Article 101 prohibition on
anti-competitive arrangements between undertakings.
The current TTBER expires on 30 April 2014 and the
European Commission (the “Commission”) consulted on
a draft revised TTBER last year.
The block exemption deals with licensing agreements
where one party (the licensor) authorises another party
or parties (the licensee(s)) to use its technology (such
as patents, know-how and software) for the production
of goods and services. It automatically exempts such
agreements from the EU prohibition on anti-competitive
agreements where a number of criteria are met.
The Commission has not undertaken a complete
overhaul of the current regime, but if adopted, a number
of the proposed changes will render the block exemption
less permissive which may in turn have an impact on
how companies (large and small) approach the licensing
of their technology.
The key changes proposed are as follows:
Market share thresholds - The Commission proposes
to lower the market share threshold applicable (to a
20% combined market share) where the parties are
essentially non-competitors but the licensee owns
a technology that is substitutable for the licensed
technology but only uses it for in-house production.
Restrictions on passive sales - The Commission
proposes to remove, from the benefit of the
block exemption, technology transfer agreements
between non-competitors that contain any form of
restriction on passive sales (i.e. sales in response
to a customer’s unsolicited order) into an exclusive
territory or to an exclusive customer group allocated
by the licensor to another licensee. The guidance
provides that in certain circumstances such a
restriction may nevertheless remain acceptable
where it is “objectively necessary” for the licensee to
penetrate a new market.
Exclusive grant-back clauses - The Commission
proposes to remove from the scope of the block
exemption all exclusive grant-back clauses. Currently
the regime distinguishes between severable
improvements and non-severable improvements and
only exclusive grant-back obligations concerning
severable improvements fall outside the scope of
the block exemption. Under the proposals, the
anti-competitive and pro-competitive effects of all
exclusive grant-back obligations will require selfassessment by the parties to the agreement.
Termination upon challenge clauses - The
Commission proposes to remove from the automatic
protection of the block exemption clauses that
allow the licensor to terminate the agreement if
the licensee challenges the validity of the licensed
technology. Such clauses will need to be assessed
on a case-by-case basis.
Settlement agreements - The Commission
proposes a number of amendments to the
Guidelines designed to address the current legal
uncertainty around settlement agreements.
Technology pools - The Commission proposes a
new safe harbour, within the Guidelines, which will
apply regardless of the market share of the pool
concerned but provided certain rather strict criteria
The consultation is now closed. It is envisaged that,
once finalised, the new rules will enter force on 1 May
2014 with a one year transitional period.