IP Bulletin - February 2014
CJEU considers the circumstances in which a Supplementary Protection Certificate may be granted for a plant protection product
Sumitomo Chemical Co Ltd v Deutsches Patent und Markenamt Case C-210/12, 17 October 2013
The Court of Justice of the European Union ("CJEU") recently ruled that a SPC could not be granted for a plant protection product which was the subject of an emergency marketing authorisation authorised under Article 8(4) of the Plant Protection Product Directive.
Whilst an Article 8(4) emergency marketing authorisation is not considered functionally equivalent to a full marketing authorisation, the CJEU did say that an emergency authorisation granted under Article 8(1) of the PPP Directive is considered to be the functional equivalent of a full marketing authorisation and, as such, a SPC could be granted for a patent which is the subject of this type of emergency marketing authorisation.
The case further illustrates the need for due diligence when contemplating taking an assignment of a patent. Note that each condition necessary for grant of a SPC, as set out in Article 3(1) of the Regulation, has to be met on the date of the application for the SPC.
Careful regard to these conditions, existing marketing authorisations, and the impact of both on grant of SPCs, is therefore an essential part of the due diligence process when considering the acquisition (or licensing) of patents.
Marketing of plant protection products is governed by the Plant Protection Product Directive 91/414 (the "PPP Directive"). Under the PPP Directive, plant protection products may not usually be placed on the market without a marketing authorisation for the product.
An exception exists under Article 8(4) whereby a product may be authorised (by way of an emergency marketing authorisation) to be placed on the market for limited and controlled use where necessary "because of an unforeseeable danger which cannot be contained by other means".
(A further exception exists under Article 8(1), although the product in this case was not the subject of this type of emergency marketing authorisation.)
Article 3(1) of Regulation No. 1610/96, the Regulation concerning Supplementary Protection Certificates ("SPCs") for plant protection products (the "Regulation"), provides that a SPC may only be granted if the product is protected by a basic patent in force if a valid marketing authorisation is in place; if the product has not already been the subject of a SPC; and if the marketing authorisation is the first authorisation to place the product on the market as a plant protection product.
A SPC, if granted, extends the period of protection of a patent by five years and confers considerable benefits on the patent holder.
Following an application to the German patent office for a SPC by Sumitomo Chemical Co Ltd, and a subsequent referral by the German Federal Patent Court, the CJEU was asked whether a SPC for a patent covering a plant protection product could be granted on the basis of an emergency marketing authorisation granted under Article 8(4) of the PPP Directive.
The CJEU ruled that the emergency authorisation (granted under Article 8(4) of the PPP Directive) was not the functional equivalent of a full marketing authorisation granted under Article 4 of the PPP Directive. An application for a SPC could not therefore be filed because there was no relevant marketing authorisation in place.
High Court rules that a contract may be made in two jurisdictions
Conductive Inkjet Technology Ltd v Uni-Pixel Displays Inc  EWHC 2968 (Ch), 7 October 2013
The High Court found, in this recent case, that a contract can be made in two different jurisdictions. The parties had omitted a choice of law and jurisdiction clause when the agreement between them was signed because they were unable to agree on both.
The court was able to establish jurisdiction and, as a result, ruled that the previous permission which granted leave to serve proceedings out of the jurisdiction should not be set aside.
As well as providing a useful reminder of the test to be applied when seeking leave to serve out of the jurisdiction, the case also illustrates the risks of parties failing to agree expressly a governing law and jurisdiction clause (a not uncommon occurrence in this digital age where contracts may be agreed by email or telephone).
Whilst not doing so may give rise to costly and unwelcome legal proceedings, some may consider, following this decision, that there are advantages to be had in following such a course of action.
The parties signed a non-disclosure agreement relating to the exchange of confidential information concerning specified technological processes. The exchange of information took place for a limited purpose, to enable the parties to progress a potential business relationship.
The agreement did not contain a choice of law or jurisdiction clause. A further contract was entered into concerning the business cooperation, and again this did not contain a choice of law or jurisdiction clause.
(A later third agreement between the parties contained a jurisdiction and governing law clause for the state of Texas, USA.)
The defendant, UPD, subsequently made two patent applications concerning certain inventions.
The claimant, CIT, alleged that the inventive concepts and subject matter of the applications were disclosed to UPD in the course of the earlier communications and business cooperation and that the defendant used the claimant's proprietary information in breach of its obligation of confidence.
CIT brought legal proceedings in the UK by way of two claims (the EPA claim and the Breach claim), seeking declarations, damages and a range of injunctive reliefs against UPD.
In addition, CIT sought leave from the court to serve the proceedings out of the jurisdiction on UPD. Permission to serve out of the jurisdiction was granted.
UPD then brought legal proceedings in Texas in the USA seeking a declaration that it had not breached any obligation of confidence. UPD also applied to the English High Court to set aside the permission granted to CIT to serve proceedings out of the jurisdiction, or alternatively, to stay CIT's action.
The present case concerned UPD's application to set aside permission to serve out of the jurisdiction.
The High Court found in CIT's favour and dismissed UPD's application to set aside permission to serve the EPA claim outside the jurisdiction or alternatively to stay CIT's EPA action. The court also ruled that, subject to the Breach claim being amended in accordance with the judgment, service of the Breach claim out of the jurisdiction would be permitted.
(The amendments related to claims for injunctions concerning activities carried out in the US; the claims were considered too broad and required amendment before leave to serve out was permitted.)
The case provides a useful reminder of the test to be applied when seeking leave to serve out of the jurisdiction and the practical considerations.
Roth J made the following points of note in his judgment:
- CIT should bear the burden of establishing that the court had and should exercise jurisdiction over UPD, such that the permission granted for service out of the jurisdiction should stand.
- The test for service out involved three requirements (following AK Investment CJSC v Kyrgyz Mobile Tel Ltd  1WLR 1804): the claimant must satisfy the court that in relation to the foreign defendant there is a serious issue to be tried; that there is a good arguable case that the claim falls within one or more classes of case in which permission to serve out may be given and that, in all the circumstances, England is clearly or distinctly the appropriate forum for the trial of the action. In the present case, the judge found on all three requirements for CIT in respect of the EPA claim.
- Following Spiliada Maritime Corp v Cansulex Ltd  AC 460, the task of the court in both stay and service out cases is to identify the forum in which the case can be suitably tried for the interests of all the parties and for the ends of justice; and in service out cases the burden is on the claimant to persuade the court that England is clearly the appropriate forum.
- In Apple Corps Ltd v Apple Computer Inc  EWCA 768, the judge found, obiter, that it is possible for a contract to be made in two places at once. The parties in the case had avoided including a jurisdiction clause in their agreement because they could not agree on one. The also concluded their contract over the telephone, one party in England and one party in California, USA. The judge concluded there was a good case for saying the contract was made in both England and California and accordingly, if the contract was made in England, one of the bases of jurisdiction (the jurisdictional gateways for service of claims out of the jurisdiction) in the Civil Procedure Rules was established.
- CIT submitted that the same reasoning in Apple Corps Ltd v Apple Computer Inc applied by analogy to the present case. The parties had expressly agreed not to include a choice of law or jurisdiction clause. The judge agreed and found that CIT had a good arguable case that the non-disclosure agreement was made in both England and Texas.
- The judge ruled that the EPA claim could only be heard in England. The Breach claim involved some other issues but, due to the overlapping issues between the EPA and Breach claims, the judge ruled that it would cause inconvenience and expense if CIT had to litigate many of the same issues in Texas in the Breach claim. Therefore it was in the interests of both parties and of justice for both claims to be heard in England. The judge found the balance in the case was in favour of England as the appropriate forum.
Is the UK Patent Box harmful to tax competition?
The European Commission is considering whether the UK Patent Box regime is harmful to tax competition.
The Patent Box was discussed at a recent meeting of the Economic and Financial Affairs Council, although no decision was taken as to whether the Patent Box is harmful to tax competition. As things currently stand, no action needs to be taken by those companies that have opted in to the Patent Box regime.
The matter has been referred to the European Union's Code of Conduct Group and a full report is expected. If the Commission's concerns are well founded and the Code of Conduct Group agrees with the Commission, UK legislation concerning the Patent Box may be amended although it seems likely that the UK government will defend the legislation.
For the time being, the current regime stands.
The new "Patent Box" tax regime provides companies with the option of applying a significantly lower, in effect 10%, rate of corporation tax to the proportion of profits derived from the exploitation of patents and certain other intellectual property rights granted by the UK Intellectual Property Office, the European Patent Office or certain other specified EEA countries.
In order for a company to benefit from the Patent Box, certain conditions must be met concerning patent ownership (the company must be the owner or an exclusive licensee of the patent) and development (the company, or another member of its group, must have carried out "qualifying development" in respect of the patent).
The European Commission is now considering whether the UK Patent Box breaches the Code of Conduct for Business Taxation (the Code of Conduct is intended to discourage EU Member States from implementing tax measures which are harmful to tax competition).
Under the Code, tax measures which provide for a significantly lower effective level of taxation than those levels that apply generally in the EU member State, are to be regarded as potentially harmful.
High Court interprets section 5(3) Trade Marks Act 1994 in Lonsdale trade mark opposition
Lonsdale Sports Ltd v Erol  EWHC 2956 (Pat), 4 October 2013
In allowing Lonsdale's appeal against Erol's application to register a trade mark, the High Court considered that use of Erol's mark would take unfair advantage of, or be detrimental to, the distinctive character or repute of Lonsdale's trade marks.
In finding for Lonsdale, the judge commented that at first glance the block of text in Erol's mark (see below) looked like something that Lonsdale might be connected with (although the average consumer would soon dispel such a first impression).
However, the judge said that first glance is important because those consumers who look at the wearer of a product bearing Erol's mark might not get more than a glance and might think the wearer was clad in a Lonsdale product:
"The creation of that illusion might be quite enough for the purchaser of a "look-alike" product: indeed who but such a person would knowingly buy a "pretend" product? Further, it undoubtedly dilutes the true "Lonsdale" brand by putting into circulation products which do not proclaim distinctiveness but rather affinity with a reputable brand".
Lonsdale Sports Ltd ("Lonsdale") sells sports clothing and is the owner of a number of marks including the following:
Erol, also engaged in selling sports clothing, applied to register the following mark:
Lonsdale opposed Erol's registration under section 5(2) Trade Marks Act 1994 (the "Act") saying there was a likelihood of confusion on the part of the public because Erol's mark was similar to Lonsdale's marks and was to be registered in respect of goods identical with those for which Lonsdale's marks were registered; and under section 5(3) TMA in that use of Erol's similar mark took unfair advantage of, or was detrimental to, the distinctive character or repute of Lonsdale's marks.
The Hearing Officer at the IPO rejected Lonsdale's opposition. Lonsdale appealed to the High Court.
The High Court upheld the Hearing Officer's ruling concerning section 5(2) but allowed Lonsdale's appeal under section 5(3) saying that the case was made out on the evidence.
In assessing unfair advantage/detriment, the Court made the following points, concluding that Lonsdale's objections based on section 5(3) TMA 1994 were made out and that Erol's mark ought not to have been registered:
- The Hearing Officer should have explicitly found a link between Lonsdale's marks and Erol's mark. It was clear from the evidence that the goods were identical; there was near identity between the relevant sections of the public to which the goods were sold; Lonsdale's use of its own marks over many decades had a positive effect on the distinctive character of at least one of Lonsdale's marks (the one ending in '127'); the elongated "L" and the cinemascope style were present in Erol's mark; Lonsdale had a long-established and successful business, lasting many years.
- The existence of the link is not itself sufficient to establish a case under section 5(3). Lonsdale needed to establish use of Erol's mark without due cause and that such use would take unfair advantage, or be detrimental to the distinctive character or repute of Lonsdale's marks.
- The Hearing Officer failed to appreciate that Lonsdale was opposing a mark which had yet to be used and therefore it would not be possible for Lonsdale to prove actual detriment. It was possible only to draw appropriate inferences from facts known and then assess the reasonably foreseeable consequences.
- Lonsdale provided the evidence and set out the inferences to be drawn, while Erol did not file evidence in response. The Hearing Officer therefore only needed to decide whether Lonsdale's inferences could be properly drawn.
- Errol did not advance a positive case of "due cause" to use its mark nor did Erol make out a case of innocent adoption or set out any circumstances which made the registration and use of its mark appropriate, irrespective of its consequences for Lonsdale.
- The Hearing Officer held that it was not clear what advantage Erol would gain. However, it was self-evident that Erol saw an "advantage" in seeking to register its mark and it was a legitimate inference (not mere speculation) that that "advantage" derived from an association with the long established reputation of Lonsdale's Mark.
- The Hearing Officer held that she could see no reason why the capacity of Lonsdale's marks to distinguish Lonsdale's goods would be diminished. However, no undertaking (apart from Lonsdale) had used the elongated "L" or the cinemascope style and extensive use of these features by Lonsdale acquired a reputation which had a positive effect on the distinctive character of Lonsdale's marks.
The High Court found that Erol's use of Lonsdale's famous mark would inevitably erode the distinctiveness of that mark and diminish the ability of the Lonsdale marks to distinguish the goods of Lonsdale from those of other traders.
The Court referred to Intel Corporation  RPC 15 at paragraph 29:
"... detriment to the distinctive character of the earlier mark, also referred to as "dilution", "whittling away" or "blurring" ... is caused when that mark's ability to identify the goods or services for which it is registered and used as coming from the proprietor of that mark is weakened, since use of the later mark leads to dispersion of the identity and hold upon the public mind of the earlier mark".
High Court orders TV Catchup Ltd to stop streaming "live" TV channel broadcasts
ITV Broadcasting Limited & Others v TV Catchup Limited HC10C01057, 7 October 2013
Following the ruling of the Court of Justice of the European Union that streaming television programmes online without the broadcasters' consent is an infringement of copyright, the High Court has ordered TV Catchup Limited to cease streaming certain digital channels.
However, this does not prevent TV Catchup Limited from retransmitting certain TV programmes over cable networks.
The Court has ordered as expected following the CJEU's ruling concerning what is meant by a communication to the public. However, the Court has also said that TV Catchup Ltd did not infringe copyright by streaming via cable (transmission via the internet but not to mobile devices via a mobile telephone network).
The reason for this is that TV Catchup Ltd was entitled to the defence in section 73 of the Copyright Designs and Patents Act 1988 which permits the retransmission of broadcasts over cable networks within the area in which the original transmissions are received (although the Order itself makes clear that there is an incompatibility between section 73 and Article 5(3)(o) of the Information Society Directive (2001/29), suggesting that this existing inconsistency may be corrected at some point, thus removing the available defence).
The Court order contains an injunction preventing TV Catchup Ltd from communicating to the public broadcasts made by ITV, Channel 4 and Channel 5 (save for those broadcasts to which the section 73 defence applies). TV Catchup Ltd is also restrained from making transient copies of the claimants' films in the buffers of TV Catchup's servers (except where the films are included in broadcasts to which the section 73 defence applies).
TV Catchup Ltd provides free-to-air viewing of TV channels to the public, to both computers and mobile devices.
The broadcasters ITV, Channel 4 and Channel 5 objected to TV Catchup Ltd's services, saying that TV Catchup Ltd infringed the broadcasters' copyrights by using the broadcasters' copyright works without consent.
In March 2013, the Court of Justice of the European Union ("CJEU") ruled that TV Catchup Ltd infringed the broadcasters' communication to the public right under UK copyright law. The case recently returned to the High Court for a final decision. (See here for our update on the CJEU's March ruling.)
The High Court has now handed down its Order, ruling that TV Catchup has infringed the claimants' film and broadcast copyright by live streaming programmes to members of the public via the TV Catchup website including by streaming to mobile devices via any mobile telephone network.
OTHER MATTERS OF INTEREST - IN BRIEF
Test for interim injunction considered by Court of Appeal in alleged patent infringement action concerning packaging for medicine doses
Protomed Ltd v Medication Systems Ltd and others  EWCA Civ 1205
In a decision that forced the claimant to consider the strength of its case at an early stage in proceedings (when seeking an interim injunction), the Court of Appeal, dismissing the claimant's appeal, agreed with the High Court's ruling that the claimant was not entitled to an interim injunction restraining the alleged infringement of two UK patents.
The Court said that the argument put forward on behalf of the claimant was untenable and the trial judge was correct in his conclusion that there was no arguable case for infringement of the claimant's patents (applying the test in American Cynamid Co v Ethicon Ltd  AC396).
The claimant's patents addressed the problem of providing safe and accurate provision of daily medication to individuals in care homes and elsewhere.
The invention provided for a monitored dosing system container, comprising a tray with individual spaced compartments, individual removable pots (each pot serving as a medicine cup in itself) sealed with removable film (which does not damage or contaminate the medication - an advantage over blister packaging).
Each tray could be filled with different kinds of medication (such as tablets, capsules, liquids or ointment).
The defendants' allegedly infringing product consisted of a plastic tray, moulded into perforated pot shaped depressions.
The trial judge, Mann J, reached the view that the defendants' product did not infringe the claimant's patent.
In refusing to grant the injunction, he said the claimant's arguments on infringement were wrong and that the question before him was whether he was satisfied that the claimant had an arguable case on infringement (the first hurdle to be overcome following American Cynamid Co v Ethicon Ltd  AC 396).
On this, the judge said he was not satisfied that the claimant had an arguable case and therefore the claimant was not entitled to an interim injunction.
On appeal, the Court of Appeal agreed with Mann J's ruling.
Specifically, concerning the test applied by the judge, the Court of Appeal said that the judge had applied the correct test following American Cynamid in considering whether there was a serious question to be tried.
In American Cynamid, Lord Diplock says that the question of whether there is a serious issue to be tried is the same as asking whether there is a real prospect of success. Deciding that there is no real prospect of success means no arguable case for infringement.
Intellectual Property Office has published a call for evidence concerning repeal of section 52 of the Copyright, Designs and Patents Act 1988
The UK Intellectual Property Office (IPO) has sought views on how and when section 74 of the Enterprise and Regulatory Reform Act 2013 (which repeals section 52 of the Copyright, Designs and Patents Act 1988 ("CDPA")) should be brought into force.
Section 52 limits the term of copyright protection for artistic works which have been exploited by an industrial process (where more than fifty copies have been made), to 25 years from first marketing of the items, rather than the standard term of life of the creator plus 70 years.
Unlike many other EU Member States, the UK limits the term of copyright protection for such works, possibly creating a legal loophole for online traders to use the UK as a staging post to import replicas into the EU that would otherwise be protected by copyright in other EU Member States.
For this reason, the government decided in 2012 to repeal Section 52 CDPA in order to bring UK legislation into line with EU law.
Evidence has now been sought to help the IPO decide on the duration of transitional provisions. What would be fair and proportionate? How much time would be needed to change the behaviour of those whose currently lawful actions would infringe copyright following repeal of section 5?
The IPO also sought views on the impact and timing of repeal from designers and holders of design rights, as well as asking specific questions of those who manufacture, import or retail classic designs replica furniture, those who use 2D images of relevant artistic works and consumers.
A repeal date and impact assessment are now expected to be published.
Updated edition of the European Patent Convention published
An updated jubilee 15th edition of the European Patent Convention (EPC) has been published to mark the 40th anniversary of the signing of the European patent system's founding treaty, on 5 October 1973 in Munich.
This edition brings together all relevant documents, including rules relating to fees and also contains an index of decisions and opinions of the Enlarged Board of Appeal published in the Official Journal of the European Patent Office, an EPC 1973 / EPC 2000 cross-reference list and an alphabetical keyword index.
For more information please contact Ian Wood on +44 (0)20 7203 5124 or email@example.com
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