CJEU RULING IN COTY – GREATER ONLINE PROTECTION FOR LUXURY GOODS SUPPLIERS

In its hotly anticipated ruling in the Coty case, the Court of Justice of the EU (CJEU) has held that, in the context of a selective distribution system, a restriction imposed on an authorised retailer not to sell the goods through online third-party platforms does not infringe Article 101(1) TFEU provided that the following conditions are met:

  • the objective of the restriction is to preserve the luxury image of the goods concerned,
  • it is applied objectively and in a non-discriminatory manner, and
  • the restriction is proportionate and does not go further than necessary.

The ruling will be welcomed by suppliers of branded and luxury goods who have increasingly expressed concerns over the potential erosion of the image of their products as a result of the recent growth in online sales, in particular on third-party online platforms such as Amazon and eBay.

In order to maintain a level of quality control over online sales of their products, suppliers of luxury goods are more frequently resorting to vertical integration and handle the distribution in-house. The Coty ruling now confirms that sales through third party distributors will allow suppliers the same level of quality control. Suppliers will still, however, need to show that their distribution system either meets the thresholds of the VABER or otherwise that their product is indeed a “luxury” or complex product which requires such a restriction to protect its image.

The CJEU decision treats the ban on third-party online platforms as a qualitative restriction that is necessary to protect the image of the goods concerned, rather than as a restriction of the customers to whom authorised distributors can sell the luxury goods at issue or as a ban of passive sales to end users, which would be in breach of Article 101(1) TFEU and amount to a restriction of competition by object.

According to the CJEU such a restriction is also not considered a “hardcore” restriction under the Vertical Block Exemption Regulation (VABER) and hence an agreement including such a restriction can benefit from the VABER if all other conditions are also met.

For the full ebulletin on this development see here.

See our previous commentary on the AG’s opinion in this case here.

Contacts

Joel Smith
Joel Smith
Head of IP - UK
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+44 20 7466 2331
Rachel Montagnon
Rachel Montagnon
Professional Support Consultant, London
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+44 20 7466 2217

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Filed under Advertising, Consumer products, EU, Licensing, Trade marks & Passing-off, Transactions, UK

UK Court of Appeal rules on validity of trade mark in light of prior existing localised goodwill

Summary

The UK Court of Appeal in Caspian v Shah considered whether a trade mark could be invalidated on the grounds of prior existing third party goodwill in a confined geographical area. On 23 November 2017, the Court of Appeal ruled that, under section 5(4) Trade Marks Act (TMA 94), goodwill established in a specific locality was capable of preventing registration of a countrywide mark: it was not necessary for goodwill to be established nationwide.  In the same way, the Court of Appeal confirmed that, once a trade mark had been registered, prior localised goodwill was capable of invalidating a mark under section 47 TMA 94 (Caspian Pizza Ltd & Others v Shah & Anor).

The Court recognised that an application for registration could be made subject to territorial limitations, but clarified that, once a trade mark was registered, the trade mark registration could not be altered to restrict its geographical scope.

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Filed under Consumer products, Passing Off, Trade marks & Passing-off, UK

UK High Court rules on copyright and joint authorship: “useful jargon”, “helpful criticism” and “minor plot suggestions” are not enough

Summary and key findings

The UK High Court, in Martin v Kogan, ruled, on 22 November 2017, that the defendant’s contribution to the screenplay for the film Florence Foster Jenkins, starring Hugh Grant and Meryl Streep in the role of Florence Foster Jenkins, a famous American socialite known for her poor opera singing, was insufficient to amount to joint authorship.

While the parties had worked on early drafts together, HHJ Hacon found that there had been no collaboration between them in respect of the final version of the screenplay and Ms Kogan’s textual and non-textual contributions had been insufficient.

Business impact

  • Film production companies should make due diligence enquiries as to authorship of commissioned screenplays, and ask about any key contributors and the extent of their contributions. Contractual warranties as to authorship may not shield them from a future copyright infringement action by uncredited authors.
  • Authors who have not actively co-operated in the creation of the final draft of a work will find it difficult to establish collaboration, a key requirement for establishing joint authorship.
  • An author who is the “ultimate arbiter” and has always had the final say in the final content of a work might have good grounds to defend a claim for joint authorship, but this status is not determinative.
  • Individuals who consider themselves co-authors should conduct themselves as such throughout their interactions with other author(s). From an early stage, they should make their contentions known and should seek to have their names published on copies of the work or, if that is not practically possible, object to their names not featuring on the final work. There is indeed a presumption of authorship in favour of the person whose name is on the copyright work.
  • Parties involved in litigation should beware of placing too much emphasis on witness recollection of meetings and conversations unsupported by evidence. The Judge in this case found such evidence unreliable and placed little, if any, reliance on witnesses’ recollection. He preferred to base findings on documentary evidence.

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Filed under Copyright, Media, Technology, media & telecommunications, UK

CJEU RULES THAT A CLOUD BASED SERVICE FOR REMOTE RECORDING IS A COMMUNICATION TO THE PUBLIC AND SO MUST OBTAIN THE RIGHTS HOLDERS’ CONSENT

This is a further case which reinforces the importance and strength to rights holders of the right to communicate a copyright work to the public provided by Article 3 of the Copyright Directive (2001/29). The CJEU held that a cloud based remote recording service amounted to a communication to the public and could not fall under the private copy exemption, which was to be interpreted strictly, and therefore the rights holders’ consent was required. (Case – 265/16 VCAST v RTI SpA.).

Business impact

  • This decision is good news for rights holders, as they will be able to take action against service providers who do more than simply provide copying services to users who are in turn relying upon a private copying exemption.
  • The CJEU decision reiterates Reha Training (C-117/15) that the communication to the public is a key right which enables rights holders to exert control over their copyright works if a service provider provides a new and different technical means of transmission to a new public for which there is no consent.
  • The case gives guidance to those providing recording services via the internet and cloud storage, and to rights holders, as to where the boundaries are to be drawn, and confirms the CJEU approach that the exceptions to copyright which can be provided by the Member States will be interpreted narrowly.
  • Whilst the UK has no private copying exception enacted, the case provides a useful reminder of the CJEU’s strict approach to interpretation of exceptions to copyright.
  • The VCAST decision continues the CJEU’s line of cases where interpretation of communication to the public has been interpreted broadly. In April we gave an update on the CJEU guidance on communication to the public following the Filmspeler decision (C-527/15) which was then applied in The Pirate Bay (C-610/16) (reported here). Similarly in the VCAST decision, the CJEU was clear that the provision of the service via the internet and cloud storage where initial broadcast was on territorial TV was sufficient to infringe, if the rights holder had not consented.

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Filed under Copyright, EU, Media, Technology, media & telecommunications

PATENT AND PHARMA UPDATE – November 2017

Key recent developments in the United Kingdom and Europe relating to the patents and pharmaceutical sector. One of the most significant developments in the patent law arena in recent years has been the decision of the Supreme Court in Actavis v Eli Lilly, which has changed the approach to patent infringement in the UK. The update starts by commenting on the new rules of infringement and looks at how subsequent decisions may apply this new test. The case will impact most pharmaceutical sector players, whether they are originators or generics, and may impact the strategy that patentees adopt when litigating in the UK. The update further reports on other significant developments in UK and European law, including a recent TBA decision which elevates the threshold for plausibility and recent references to the CJEU on the SPC Regulation.

1. A new UK approach to infringement: equivalents infringe a patent, but do not anticipate it?

The UK Supreme Court has redefined the UK approach to patent infringement, holding that the scope of protection of a patent extends to “equivalents” of the claimed invention. However, the Patents Court has since held that such equivalents, even if they pre-date the patent, do not anticipate it Read more


2. Plausibility before the EPO and reliance on post-published evidence

BMS has filed a petition for review to the Enlarged Board of Appeal regarding the TBA’s decision to revoke BMS’s patent for the anti-cancer drug dasatinib. The Board’s decision to revoke the patent suggests that the threshold for plausibility has been elevated, at least in the context of an inventive step Read more


3. Further References to the CJEU on Supplementary Protection Certificates (“SPCs”)

The German Federal Patent Court has referred two further issues to the CJEU regarding the interpretation of Article 2 and 3(a) of the SPC Regulation. In relation to Article 2 the Court has asked whether an SPC can be obtained for drug device combination products and, if so, in what circumstances. With regards to Article 3(a) the Court has added further detail to the questions asked by Arnold J in Teva v Gilead Read more


4. New Unjustified Threats Regime in force from 1 October 2017 – encompassing unitary patents and European patents under UPC jurisdiction

The new Unjustified Threats Regime has recently come into force. This Regime is an attempt to encourage more pre-action communication by providing greater clarity on what amounts to an actionable threat Read more


5. Further information ordered to be provided in an enquiry as to damages under a cross-undertaking

Birss J has provided guidance on pleadings for damages under a cross-undertaking. The High Court found the Points of Claim were fundamentally lacking critical information and Sandoz was ordered to provide further information on their substantial £100 million claim for damages, including profit margins on each type of product and profit flows between the relevant Sandoz group companies (under agreed confidentiality terms) Read more


6. UK court strikes out a claim for loss suffered as a result of the tort of unlawful deceit

The High Court has struck out the NHS’s claim for damages based on the tort of causing loss by unlawful means regarding misrepresentations on novelty/obviousness. Roth J’s interim decision represents the latest instalment in the fall-out from Servier’s actions concerning delayed entry of perindopril, and suggests that this tort should be confined within a narrow ambit Read more


7. Judicial consideration of a collaboration agreement in Astex Therapeutics Limited v AstraZeneca AB [2017] EWHC 1442 (Ch), (“Astex”)

Arnold J’s judgment in Astex provides insight into how the Courts will approach the interpretation of a research and collaboration agreement. Arnold J also commented on the amount of witness evidence that was put before him concerning events that had occurred between 10 to 15 years ago Read more


8. Developments in Europe

A brief overview of the developments in the European arena in the past months, including an EU Commission consultation on SPCs, the new approach adopted by EPO to patentability of products obtained by essentially biological processes and how HSF can help you to successfully navigate the new data protection laws Read more


9. UPC Update

This article provides an update on the progress of ratification of the UPCA in the UK and Germany Read more

 

See our previous Patent and Pharma Updates on our IP Blog here:

Patent and Pharma Update – June 2017

Patent and Pharma Update – January 2017

Patent and Pharma Update – May 2016

 

Authors

Sophie Rich
Sophie Rich
Partner
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Jonathan Turnbull
Jonathan Turnbull
Senior Associate
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+44 20 7466 2174
Monika Klajn
Monika Klajn
Associate
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+44 20 7466 7604
Rachel Montagnon
Rachel Montagnon
Professional Support Consultant
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+44 20 7466 2217

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Filed under EU, Patents, Pharma, SPCs, The Unified Patent Court and the Unitary Patent, Threats, UK, Uncategorized

November UPC Update

In June we gave an update on the progress of the UPC, including the announcement by the UPC Preparatory Committee that the 1 December 2017 start date could not be maintained. We reported on the need for ratification of the UPC Agreement, as well as the UPC Protocol on Provisional Application (the Protocol), by a number of states including the UK and Germany, which are mandatory signatories along with France.

UK

The UK has recently drawn closer to ratification as a result of the International Organisations (Immunities and Privileges) (Scotland) Amendment (No 2) Order 2017 being approved by the Scottish Parliament on 25 October 2017. This order will confer certain privileges and immunities on the UPC and its judges and other staff. As we have reported previously, the equivalent statutory instrument, the Unified Patents Court (Immunities and Privileges Order) 2017 was laid before the House of Commons on 26 June 2017 and is awaiting approval by both chambers of the Westminster parliament. Before this can occur, it must pass through three committees: the Joint Committee on Statutory Instruments (JCSI), the Secondary Legislation Scrutiny Committee and the Delegated Legislation Committee. The members of the JCSI were recently re-appointed (on 31 October 2017), following its dissolution prior to the general election in June this year. It is now up to the JCSI to report on any instance where legislative power has been exceeded or the drafting of the order is defective or requires further explanation.

Germany

There has been some delay to the German ratification of the UPCA, owing to a case pending before the German Federal Constitutional Court (FCC) regarding the law passed by German Parliament on its implementation. The German court has asked for observations on the case and had previously set a deadline for any comment by end of October 2017 – though it has been reported that this has now been extended to the end of the year. The FCC will then determine whether or not to dismiss the complaint, a process which is expected to take until at least April 2018. If the complaint is dismissed, Germany will be able to ratify the UPCA soon after. There has, however, been talk of the possibility of the case being referred to the Court of Justice of the EU (CJEU), which would cause substantial delay to the case being decided and ultimately to Germany’s ratification.

Overall, according to the latest update on the UPC website, published on 21 September 2017, while good progress has been made, “[i]t is now difficult to predict any timeline”.

 

For more information and analysis see our UPC and unitary patent hub here.

Author

Katie Pryor
Katie Pryor
Senior Associate
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+44 20 7466 6313

 

 

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Filed under EU, The Unified Patent Court and the Unitary Patent, UK

UK HIGH COURT RULES ON COPYRIGHT PROTECTION OF TV FORMATS FOR GAME SHOWS

Summary

The High Court of England and Wales decided on 19 October 2017 that a particular television format document did not qualify for copyright protection as a dramatic work as its contents were unclear and lacking in specifics. Copyright protection has been notoriously difficult to obtain in respect of TV formats and the case contains useful guidance on the way television formats should be recorded or expressed in order to stand a chance of being protected by copyright as dramatic works. The High Court also considered that the TV format document was too vague and insufficiently developed to be protected as confidential information (Banner Universal Motion Pictures Limited v Endemol Shine Group Limited & others).

Business Impact

  • The decision acts as a warning for TV format developers that generalised commonplace game concepts, even if they are supported by specific examples, will likely fall short of the requirements for copyright protection as dramatic works.
  • Television producers who acquire the rights to TV formats should ensure that TV format documentation is sufficiently detailed and is kept up-to-date as the resulting shows develop. It shows the importance of a format bible.
  • To qualify for copyright protection as a dramatic work, contents of TV formats should be clear, specific and contain elements forming a coherent recognisable framework capable of being reproduced into a distinctive show.
  • In order to increase chances of their formats being protected by copyright, developers/producers should think of including the following in their documentation:
    • where the action is to take place;
    • who the contestants should be and the selection process;
    • the length of the programme;
    • when the show should be aired;
    • the source of the prizes (if any); and
    • catchphrases, identified as such (it is not sufficient to simply list words or expressions).
  • One of the major difficulties in establishing the infringement of copyright in formats for game shows is showing that what has been copied is the expression of ideas, rather than pure ideas themselves.
  • While the High Court acknowledged the possibility for television formats (even if not fully developed) to be protected by the law of confidential information, information which is too vague, insufficiently developed and of a very general nature is unlikely to qualify for protection under the common law of confidential information.
  • Claimants who have been unsuccessful in proceedings in one country should beware of starting similar proceedings against identical defendants elsewhere, as they may be estopped from doing so and such proceedings may amount to an abuse of process.

Authors

Joel Smith
Joel Smith
Head of IP - UK
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+44 20 7466 2331
Alexandra Morgan
Alexandra Morgan
Senior Associate, London
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+44 20 7466 2808

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Filed under Consumer products, Copyright, Format rights, Passing Off, Technology, media & telecommunications, UK

The High Court considers the doctrine of equivalents in the context of patent infringement and novelty

The High Court in Generics (U.K.) v Yeda Research has considered the correct approach to the interpretation of patent claims in light of the recent Supreme Court decision in Actavis v Eli Lilly.

This High Court decision provides early indication of some possible ramifications of the decision in Actavis in relation to the assessment of novelty, but considerable uncertainty remains.  What is clear is that Actavis represents a significant change in English patent law.

The judge also reinforced that common general knowledge will only comprise information which is proven to have been common general knowledge in the UK at the relevant date, and refused to grant an Arrow declaration on the facts of this case.

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Filed under Patents, Pharma, UK, Uncategorized

Herbert Smith Freehills launches Milan office with leading disputes hire

Herbert Smith Freehills has further strengthened its European offering with the opening of a new office in Milan and the hire of Simmons & Simmons Dispute Resolution and IP Head in Italy, Laura Orlando. Continue reading

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Filed under Uncategorized

EU Trade Mark reforms come into force – motion, hologram and multimedia marks can now be registered

A number of EU trade mark reforms came into force on 1 October 2017.  The key changes are:

  • The graphical representation requirement has been abolished. In theory, it should now be easier to file non-traditional forms of marks at EU level. Sound marks may be represented by digital sound files. Motion, multimedia and hologram marks may also be accepted. The graphic representation requirement has been replaced with a requirement that signs be represented in any appropriate form of generally available technology, as long as the representation is clear, precise, self-contained, easily accessible, intelligible, durable and objective.  The change in the law will also apply for all national marks filed in EU Member States once this provision is implemented into national laws. Brand owners should consider whether new filings for EUTMs should be made. In some industry sectors, the potential to more easily register sound, motion, multimedia and hologram marks could offer significant opportunity to add further layers of protection to brand portfolios on an EU level.
  • EU Certification Marks have been introduced which are a new type of trade mark at EU level which will guarantee specific characteristics of certain goods/services. The introduction of this form of marks aims to harmonise the position across the EU as some Member States did not allow for certification systems under their national systems. EU certification marks will be owned by the appropriate organisation or certifying institution responsible for certifying and monitoring the qualities or characteristics of the products. These marks may not be owned by suppliers of the goods and services in question.  An applicant for an EU certification mark must submit regulations governing its use to the EUIPO within two months of the filing of the application.
  • A number of procedural changes have also been introduced, the full details of which are contained in the updated EUIPO guidelines.  These include a change on acquired distinctiveness as applicants may now pursue a subsidiary claim of acquired distinctiveness after they have exhausted the right of appeal on the inherent registrability of a trade mark. Translation requirements have also been simplified and assignment of an EU trade mark can be sought as an alternative remedy to invalidation. Priority claims must be filed at the same time as filing of an application and not afterwards.  Applicants may rely on online sources recognised by the EUIPO for substantiation of earlier rights in oppositions and cancellation actions.

These recent changes form part of a package of EU trade mark reforms, many of which came into force on 23 March 2016. For further detail on all changes under the EU trade mark reform package, please see our previous e-bulletin here.

Authors

Joel Smith
Joel Smith
Head of IP - UK
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+44 20 7466 2331
Sarah Burke
Sarah Burke
Senior Associate, London
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+44 20 7466 2476

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Filed under Advertising, Consumer products, Counterfeiting, EU, Trade marks & Passing-off, UK