|Carefully selecting some IP blogs!|
Wednesday, 18 January 2017
|New Year New Cat|
Tuesday, 17 January 2017
We would like to bring the attention of our German Readers a recent decision (published 13 January 2017) of the Federal Court of Justice (Bundesgerichtshof, BGH) with far-reaching implications for practitioners. In essence, the BGH held that any prohibition to distribute a product entails an obligation to actively recall any products already on the shelves, endorsing the view expressed by the Oberlandesgericht Munich in 2013. The same dispute has already led to a judgment of the ECJ on 23 November 2016 (not related to the enforcement of the order).
Plaintiff had obtained an injunction based on unfair competition law (UWG) against the mareting and distribution of alcoholic beverages under the signs "RESCUE DROPS" and "RESCUE NIGHT SPRAY" ("es zu unterlassen, im geschäftlichen Verkehr als Spirituosen gekennzeichnete Produkte unter der Bezeichnung „RESCUE TROPFEN“ und/oder „RESCUE NIGHT SPRAY“ zu bewerben und/oder zu vertreiben"). By its wording, the order only entails an obligation to cease and desist, and not any obligation to actively recall any products. The order became provisionally enforceable.
Defendant failed to recall any products already sold to retailers (primarily pharmacies). Plaintiff argued that this violated the order - and prevailed. The BGH held that in a case where the continued presence of the products on the shelves of retailers creates a continued disturbance ("fortdauernder Störungszustand"), the obligation to cease and desist includes the obligation to remove the continued disturbance, although generally, an obligation to cease (Unterlassungspflicht) must be distinguished from an obligation to remove (Beseitigungspflicht). It was further irrelevant that the buyers of the products were not obliged to comply with any request for a recall of the products (since they have become the legal owners of the products). The key reasoning is in paras. 24-27 of the decision for those who read German.
While the injunction in this case was based on unfair competition law, it is hard to see that the outcome would have been any different for a prohibition based on trade mark, copyright or patent law. In essence, any obligation to cease distribution of a product in Germany in the future also entails the obligation to recall products already distributed (and not yet used up). Failure to do so makes the Defendant liable to pay the administrative fine imposed by the order in case of non-compliance - in the case at hand, EUR 15,000 for the omission of recalling the products.
Monday, 16 January 2017
Social media, "WikiLeaks" and false news in the 18th century: Thomas Jefferson and the "Mazzei letter"
The political dynamics of the nascent American republic in the early 1790’s (remember the U.S. Constitution had been ratified only in 1788) witnessed an ever-increasing split between Jefferson and the ruling Federalist party led by President George Washington and Alexander Hamilton, especially over relations with France and England. Jefferson was an ardent supporter of France, having been energized by the French Revolution. In 1794, John Jay was sent by President Washington to England to negotiate a treaty (the Jay Treaty), which put an end to the dispute between those two countries.
The treaty enraged Jefferson, to the extent that when, on April 24, 1796, he wrote a private letter to a former neighbor in the United States, Philip Mazzei, now living in Pisa, Jefferson could not resist adding several sentences about the political situation. He described the Washington presidency (and by extension, the Federalist party) as “[a]n Anglican, monarchial and aristocratical party”. The distinguished American historian, Gordon Wood, summarizes the gist of Jefferson’s dissatisfaction with Washington as follows (“Empire of Liberty”, p. 235) —
“[Washington] was trying to subvert the American’s love of liberty and republicanism and turn the American government into something resembling the rotten British monarchy.”Jefferson’s own words were much more graphic—
“It would give you a fever were I to name to you the apostates who have gone over to these heresies, men who were Samsons in the field and Solomons in the council, but who have had their heads shorn by the harlot England.”John Adams.
But it is not so certain that there ever was a published translation into Italian. The Editorial Note to the Papers of Thomas Jefferson concludes that “[t]he Editors, however, have found no trace of an Italian publication …”, although Jefferson himself apparently believed so. At most, Mazzei may have translated the contents in Italian for an acquaintance in the diplomatic corps. The Editors suggest that Mazzei most likely copied the relevant contents in their original English and shared it with two friends, one of whom upbraided Mazzei for circulating the text without permission. Mazzei’s motivations for making the copies and dispatching them are not clear. Also not clear is exactly who translated the contents into French (perhaps from the original English, perhaps from an Italian translation) and who forwarded it to the French newspaper, Le Moniteur Universel.
What then happened in the United States is particularly noteworthy, involving, as it did, translations into English from a translation into French from either an Italian translation or from the original English text. As the Editors write--
"Three and a half months after the extract's appearance in France, the Federalist editor of the New York Minerva, Noah Webster, obtained a copy of the French newspaper from Epaphras Jones, a New York City merchant and ship owner who had recently returned from France. Webster arranged to have the extract and the Moniteur's subjoined paragraphs translated into English and printed in the 2 May issue of his newspaper. Subsequent mentions of it appeared in the Minerva on 3, 4, 6, 8, and 19 May. When Jones requested the return of his French newspaper, Webster made a copy for himself and had it certified by James Kent on 22 May. Webster also noted that Timothy Pickering, then secretary of state, “sent to me for the original paper, and had the letter in the original with a translation, if I mistake not, published in the Gazette of the United States”. After its publication there on 4 May, Pickering had his own copy prepared and certified by his chief clerk for his files (on 3 June). Pickering returned the newspaper to Webster. The extract in the Moniteur, of unclear lineage, had by then become the official version of Jefferson's letter, from which all American subsequent versions derived" [footnotes and citations omitted].American newspapers. pro and anti- Federalist, pro and anti-Republican, themselves published the contents in English (not based on the original English text, but from an English translation from a French, and perhaps even before then, an Italian version.) Sometimes this derived English text was accompanied by commentary, itself not infrequently expressed in the most scurrilous terms. As Wood describes, Federalist opponents of Jefferson read out the these portions on the floor of the Congressional House of Representatives, and one congressman then proclaimed: “Nothing but treason and insurrection would be the consequence of such opinions.” Claims were made about the accuracy of the English text and Jefferson defenders even challenged the attribution to Jefferson as the author of the text (which apparently he never denied). The controversy over the letter hounded Jefferson throughout the rest of his life (he died in 1826).
With one ear attuned to the public discourse of our own moment, what do we make of the "Mazzei letter" affair? Once the letter left Jefferson's hands (presumably he did not make a copy), it was left to the whims of the social media of the day. The role of the newspapers was crucial. As Wood observes, all parties involved sought—
"… a way of dealing with the immense power over public opinion that newspapers were developing in the 1790's. In fact, the American press had become the most important instrument of democracy in the modern world, and because the Federalists were fearful of too much democracy, they believed the press had to be restrained" (p. 250) [but the Federalists lost political power forever by 1800].Then, as now, IP seems to have played a minor role, if any. At least in the 1790's, one could point to the fact that the copyright laws were in their infancy (translations were in any event not yet protectable) as well as to the absence of protection for privacy and confidences. The dispute over the unauthorized publication of the private etchings of Prince Albert and the recognition of a right in confidences was still over 50 years away (Prince Albert v. Strange).
Still the last word, as the first, belongs to Kohelet/Ecclesiastes—"there is nothing new under the sun".
By Neil Wilkof
Friday, 13 January 2017
The Court of Appeal decided yesterday that the High Court can, as a point of principle, properly grant declarations that a product lacked novelty or an inventive step at a particular date, see Fujifim Kyowa Kirin Biologics Co., Ltd v AbbVie Biotechnology Limited and Others  EWCA Civ 1. This issue will now be considered at trial - the first of which is due to commence on Monday 16 January 2017. A declaration in these terms is described as an Arrow declaration, due to the form of relief sought in Arrow Generics Limited v Merck & Co. Inc.  EWHC 1900 (Pat), which settled before trial.
This decision is the latest instalment in the epic battle concerning AbbVie's blockbuster Humira product, and Fujifilm Kyowa Kirin Biologics (FKB's) attempts to clear the way for its biosimilar launch (see last week's post here). The first appeal concerned a decision of Carr J where he refused to strike out a claim for an Arrow declaration (as previously reported on the IPKat by Annsley here). The second appeal was from decision of Arnold J and concerned the availability of an injunction to support an Arrow declaration (see previous IPKat post here). The background to the dispute can be found in the posts referred to above.
The precise form of the declarations of invalidity sought by FKB are set out at paragraph 43 and 46 of the Court of Appeal judgment. The aim of the relief sought is to protect FKB from any subsequent infringement action brought by AbbVie based on divisional applications once they proceed to grant, in respect of FKB's biosimilar product.
AbbVie's challenge to the relief sought by FKB and s74 Patents Act
AbbVie contended that Arrow was wrongly decided, and that actions for Arrow declarations are precluded by s74 of the Patents Act 1977 because they put the validity of a patent in issue. Floyd LJ summarised AbbVie's complaint concerning the relief sought by FKB as follows: by asserting that the dosing regimen is old or obvious, the Arrow declarations (if obtained) would be making it clear that a future patent claim to that regimen would be invalid. Accordingly, if AbbVie were to obtain the grant of claims in that form, the resulting patent would have been pre-emptively adjudged invalid. There is therefore implicit in the Arrow declaration, an inter partes declaration of invalidity of a putative patent, not yet granted, having those claims.
Section 74 of the Patents Act is entitled "Proceedings in which validity of patent may be put in issue", and section 74(1) provides a list of proceedings where the validity of a patent may be put in issue. Section 74(2) then provides that:
"The validity of a patent may not be put in issue in any other proceedings and, in particular, no proceedings may be instituted (whether under this Act or otherwise) seeking only a declaration as to the validity or invalidity of a patent."
Court of Appeal decision
The Court observed that the primary purpose of section 74 is to ensure that proceedings in which the validity of a patent is put in issue will always be before a court or tribunal which has jurisdiction under the Act to revoke the patent if the grounds of invalidity are made out. Section 74 is also concerned with putting in issue the validity of granted patents. The Court of Appeal accepted that the Patents Act is a complete statutory code for challenging the validity of a granted patent, but noted that the Arrow declarations sought do not declare any patent invalid. On the facts, there are now no longer any granted patents in the background in relation to which they could have that effect. The Court of Appeal concluded that there is nothing in the scheme of the EPC and the Patents Act to prevent an Arrow declaration where there is real justification for their grant.
The Court of Appeal's summarised the legal position as follows:
i) A declaration that a product, process or use was old or obvious at a particular date does not necessarily offend against section 74 of the Act.
ii) Such a declaration may offend against the Act where it is a disguised attack on the validity of a granted patent.
iii) Such declarations do not offend against the scheme of the EPC or the Act simply because the declaration is sought against the background of pending divisional applications by the counter-party.
An Arrow declaration is a discretionary remedy
The granting of an Arrow declaration is a matter of the Court's discretion. The Court of Appeal was careful to note that "A claimant cannot seek an Arrow declaration simply because it would like to know whether a patent application in the course of prosecution will result in a valid patent. The course envisaged by the statute is that he should wait and see what, if any, patent is granted. The statutory remedy does not constitute a bar in principle to the granting of declaratory relief in appropriate cases, however. Where, for example, it appears that the statutory remedy is being frustrated by shielding subject matter from scrutiny in the national court, it should be open to the court to intervene."
The Court of Appeal was more hesitant about the justification for granting an injunction in the terms sought. However, it was not minded to strike out the claim for an injunction at this stage, and noted that "an appropriately framed injunction may be an alternative to the declaration".
The appeals from these strike out applications were therefore dismissed.
Tuesday, 10 January 2017
Monday, 9 January 2017
|That which we call a rose|
This was a summary judgment decision which focused on the question of whether a partner or the firm owns the goodwill she develops in the course of her professional duties and whether she can stop the firm from continuing to use her name when she leaves the partnership.
The dispute arose when a partner, Ms Bhayani, left Taylor Bracewell but the firm continued to use a sub-brand she had developed and for which the firm had registered a trade mark: Bhayani Bracewell. Ms Bhayani alleged passing off and revocation of the trade mark on the basis that use of the trade mark was liable to mislead the public that she was still a partner at the firm (under section 46(1)(d) of the Trade Marks Act 1994). The partnership agreement was also considered in light of both issues.
Season's Greetings and Goodwill to all mankind
Goodwill, the first limb of the passing off "trinity" was the primary focus of the hearing.
It was accepted that Ms Bhayani had acquired a reputation in the field of employment law. However, reputation is not the same as goodwill and on its own is not sufficient to found an action for passing off. So, whilst an individual partner may have a professional reputation, it does not follow that they own the goodwill in their name. As HHJ Hacon noted "goodwill cannot in law subsist as a thing alone - it is indivisible from the business with which it is associated." Therefore, in the normal course of things the goodwill generated by a partner's acts will vest in the partnership.
The judgment did go on to consider some circumstances in which an employee (or partner) could generate goodwill of their own. For example:
Landa v Greenberg  24 TLR 44 - a contributor to a weekly column in The Jewish Chronicle under the name "Aunt Naomi" was granted a declaration that she was entitled to the Aunt Naomi name and an injunction to prevent the new proprietor from continuing to use the name.
|Dr Crock & his Crackpots|
Forbes v Kemsley Newspapers Ltd (1951) 68 RPC 183 - "Mary Delane" wrote various articles in the Sunday Times under a pen name which was chosen by the defendant. Her contract was terminated but the defendant continued to publish under the Mary Delane name The judge noted that "a person who writes under a pseudonym is entitled to the property in that name as part of his or her stock-in-trade unless there is a term, express or implied, to the contrary in an agreement with an employer". There was no such term so the claimant was granted her injunction.
Irvine v Talksport  EWHC 367 - TalkSport created a brochure which used an image of Eddie Irvine with a TalkSport branded portable radio superimposed on the image. Irvine brought a successful action for passing off on the basis that the brochure falsely represented that Irvine endorsed the TalkSport radio station.
These cases were distinguished on the basis that they either related to (i) writers/performers so the court assumed that the public would consider the artist to be solely responsible for their creative output or, (ii) in the case of Irvine, to a separate business to his contract with Ferrari as a racing driver. In other words, Irvine endorsed products as part of a separate business and consequently had generated a distinct goodwill which was his and on which he could found an action for passing off.
Because Ms Bhayani's reptuation had all been carried out at law firms (rather than sole proprietorships), there was no separate business which could be characterised as belonging to Ms Bhayani. This meant that the goodwill in her name vested in Taylor Bracewell and her previous firm. No goodwill meant that the passing off action could not possibly succeed.
|Careful contract reading can avoid later drama|
Under this intriguing heading, HHJ Hacon went on to suggest that if a firm continued to represent a solicitor as being employed by them after their departure from the firm it would be possible to take action against them either on the basis that (i) the goodwill associated with the name of the solicitor vests in their new firm and/or (ii) there has been an injurious falsehood.
The partnership agreement further strengthened Taylor Bracewell's case although it did explicitly note that Ms Bhayani was free to use her own name in the course of trade now that her employment at the firm had ceased. This agreement, arguably, also gave Taylor Bracewell a contractual right to continue using the Bhayani Bracewell mark.
Revocation of a trade mark which is liable to mislead the public
Section 46(1)(d) of the Trade Marks Act 1994 provides that:
(1) The registration of a trade mark may be revoked on any of the following grounds— ... (d) that in consequence of the use made of it by the proprietor or with his consent in relation to the goods or services for which it is registered, it is liable to mislead the public, particularly as to the nature, quality or geographical origin of those goods or services.Ms Bhayani claimed that Taylor Bracewell's use of Bhayani Bracewell was liable to mislead the public that she was still associated with the firm. The judge agreed that this argument had a realistic prospect of success and thus declined to strike out the claim.
Sunday, 8 January 2017
Lessons from Chanel and Coty’s "Smell-Alike" Victory
A Netherlands court has held that use of perfume comparisons constitutes trademark infringement when it crosses the boundaries of comparative advertising. The flourishing trade in “smell-alikes” is a thorn in the side of the makers of well-known perfumes, including Chanel and Calvin Klein. However, thanks to a recent judgement from the District Court of The Hague, these parties’ ability to fight such practices has been strengthened.
|Sticking to the New Year’s resolution!|
At issue is a senior citizen retirement facility. One can discern two different scenarios with respect to the use of a mark and brand in connection with carrying on such a business. The first is use on a single, stand-alone facility, with a mark and brand unique to that facility. In this situation, the strength of the brand is tied to the success (or failure) of that facility at its specific location. (See a previous post by this Kat, which speculated about the branding issues of a single-site business in the context of the use of a highly descriptive mark.) The second is a chain, in which the properties are either all owned and operated by a single entity, is run as a franchise operation, or is organized in some combination of the two. Here, the mark and brand must deal with the challenge of maintaining quality control across multiple facilities. Succeed, and the business can enjoy the fruits of scale plus the prospect of continuing expansion.
All of this is straight-forward enough in principle. But here, the retirement facility in question has been operated at the same location for decades under a mark that has become well-recognized as identifying the facility located at that site. Indeed, a broad swathe of the broader population connects the name with that specific facility. This facility was recently acquired by a real estate developer that, inter alia, owns a chain of retirement facilities throughout the country. The question then becomes—how does the acquirer brand the facility?
If we seek to analogize to the hotel business, hotels are sold from one owner/chain to another. Usually, the new owner quickly replaces the mark and brand with its own mark and brand; why remind patrons about your competitor? That may be well and good when the acquirer and acquired are both hotel chains. But what about the situation where, as here, a real estate developer acquires a single site facility? The solution adopted by the real estate developer was to keep the signage with the previous name of the facility prominently displayed at the top of the building. Not only that, but both in print, as well in radio ads broadcast over the entire country, the real estate developer continues to mention the previous name of the facility along with the new name.
At first glance, this seems a bit odd; why refer to two different names for the same business? The answer seems to be—used in tandem, these two marks enable the new owner to build its goodwill and reputation in the new mark by emphasizing, at least for a period of time, the goodwill and reputation enjoyed by the business at its long-term location under its previous name. The triad of commercial identity is: mark-business-location.
As a closing curiosity, another store near-by to this Kat (this Kat’s neighborhood is a virtual cornucopia of instructive trademark curiosities), this time a boutique for home furnishings, changed its name but continued to prominently display for nearly 10 years the following notice-- “Previously known as ‘Home Store’”. Here, as well, there is branding value in continuing to inform those who pass by that “what was, will continue to be”, at this location.