Protecting Your Brand and Intellectual Property by Brian Miller, Solicitor and Trade Mark Lawyer

A whistlestop tour to protecting your brand and intellectual property by registration of trademarks, design rights and domain names and the consequences of not doing so is now available at here: An Introduction to Intellectual Property by Brian Miller, Trademark Lawyer and IT Solicitor . Includes guidance on how to deal with cybersquatters, copyright and its exceptions, how to register trade marks, design rights and patents, use of databases and website compliance.

The Trademark Clearinghouse: Should I Register?

Brian Miller examines whether you should consider registering your trade mark with the Trademarks Clearinghouse or whether in fact you would just be better employing a private domain watching service. For more information, go to The Trademarks Clearinghouse: Should I Register?

EU COMMISSION PLANS INCREASE TO EU TRADE MARK FEES by Brian Miller Solicitor

Following a discovery by the EU Commission that OHIM, the body responsible for registering EU trade marks, is making a profit from its fees, the Commission plans to remove the surplus to its own funds.

As part of this review, the Commission intends to reduce the number of classes which are included in the initial one off registration fee from three classes to one. This will effectively increase costs for all businesses (but particularly small ones), who cannot ill afford this increase in costs, unless they simply decide to register an EU trade mark only in one class.

But deciding to take that strategy in order to save costs is not advisable, since if a business or organisation operates in more than one area, it will need to register in more than one class  in order properly to protect its brand. It will therefore have no choice but to pay the extra fees if it wishes to continue to do so.

OHIM fees to register a trade mark are currently €900 for an online application (€1050 otherwise), which includes three classes.  The fee for each addition class is €150 euros.  This means that, in order to sustain an application which includes three classes, the applicant will pay an extra €300 euros, an increase of 33% over the current fee for a trade mark which includes three classes.

There was a mini-hearing before the Legal Affairs Committee of the European Parliament just before the summer break, on 8 July. The issues of fees was hotly debated and member states have unanimously rejected the Commission’s legislative package, on the grounds principally that it overlooks the interests of SMEs, which the Commission hotly contests.

The debate rolls on and time will tell whether SMEs will persuade the Commission that changing from a one-fee-for-three-classes to one-fee-for-one-class approach is only going to increase the coffers of OHIM, which was the main reason for making the change in the first place!

ESTATE PLANNING: Digital Death

In an age of social networking and online media, it is easy to overlook the potential value digital data holds when dealing with the estate of a deceased person.

We all know the importance of estate planning for our investments and physical possessions, but what steps should we be taking to protect the belongings we store online and other intellectual property?

Email

Broadly, you own your personal email and electronic correspondence, which can be left to a beneficiary in a will. However, if a username and password are not specified, a will might be not enough to force some email providers to grant a beneficiary access to your emails.

By way of example, in 2005, Yahoo! refused to release the login and password to the family of a Marine who died in Iraq. The matter went to court and Yahoo! was ordered to release the account details to the family. Gmail and Hotmail will provide a CD copy of emails to a family, provided proof of death and proof of relationship are supplied.

Conversely, you might not actually want anyone to be able to access your email account on death. If this is the case and you want your executors to close your online accounts after you die, you should explicitly stipulate your login details and wishes in a letter of wishes associated with your will.

Facebook and Twitter

Facebook and Twitter will provide login details, regardless of what your will specifies, as the Terms and Conditions of both stipulate that a user’s account is the property of the company. On death, Twitter will delete your account after receiving the death certificate from a family member, even if technically this is the prerogative of your executors.

When a member of Facebook dies, their profile can be ‘memorialised’, meaning only the user’s friends are allowed to see and comment on the deceased’s page. Facebook will remove an account if requested by the deceased’s family after they provide a death certificate, although again technically this is the prerogative of your executors.

Patents

A patent is a right that allows inventors to prevent another from making, selling, or using another invention that is similar in nature. Patents may be used to protect inventions, machines, devices and processes.

In the case of a deceased owner of a patent, a certified copy of the probate or letters of administration is required. The executor named should then complete an assignment as though he were the owner but where the executor and beneficiary are the same person or the named beneficiary is to be entered as the new owner, a copy of the will or a signed statement of “assent” by the executor may be required.

Trademarks

A trademark is a legal means of identification to distinguish a trader and his or her products from those of other traders.  It can be a word, letters, a logo, a shape, numerals, a signature, and even sounds and smells, or a combination of these.

Trademark rights can last indefinitely as long as the owner continues to use the mark to identify its goods or services. The term of a trademark is 10 years, with 10-year renewal terms.

Designated trademarks and brands are the property of their respective owners. If an owner of a trademark passes away, form TM16 must be filed with the Intellectual Property Office (IPO) to record the change in the register of trade marks. As with a patent, the legal term for a transfer of ownership is an 'assignment’.

Intestacy

If an artist is domiciled in the UK and they have not made a will, then all of the assets which are in their sole name, including all real and personal property, money, artwork, copyright and ARRs, will pass to their next of kin in accordance with the rules of intestacy. These rules dictate how and to whom an estate will be distributed and as such this may not be in accordance with the wishes of the artist. In addition, unexpected inheritance tax charges can follow on intestacy, when some assets pass in trust to children and not just a surviving spouse or civil partner.

Estate Planning

A properly drafted will and effective estate planning are essential if you want to ensure that your estate passes to the people you choose it to go to in the most efficient way. 

At Stone King we can advise you on the best way to make provision for your family and loved ones, taking all your circumstances into account. Our specialist wills and estate solicitors can also act as your professional executors and trustees, either working alone or alongside others.

If you would like to know more, Brian Miller can be contacted at Stone King, Solicitors or by calling 0207 324 1523.

Disclaimer: This article may not be reproduced without the prior written permission of the author. This article reflects the current law and practice. It is general in nature, and does not purport in any way to be comprehensive or a substitute for specialist legal advice in individual circumstances.

IP Lawsuits: There’s one born every minute

The latest Apple v. Samsung case is just the tip of the iceberg.

In a trend Matt Asay recently dubbed ‘patent insanity’, the likes of Google, Nokia, HTC and even Amazon have joined old culprit Microsoft in turning their attention to feuding over IP.  This pattern is leading to concerns that innovation will be stifled in the electronic market.

After the introduction of the Android smartphone in January 2010 the late Steve Jobs declared:   ‘I’m going to destroy Android, because it’s a stolen product.  I’m willing to go thermonuclear war on this’.

His infamous knack for prediction would appear to be on the money once again as bloggers liken battles over IP between corporate giants to ‘WWIII’.  Certainly, IP suits have become fiercer, and with higher stakes.

The latest suit launched by Google against Apple threatens to ban iPhones, iPads and iPods from entry into the U.S., worth an estimated $120 billion in annual revenue.

Clearly, the current climate is not one in which to underestimate the value of IP.  If you are in doubt as to whether or not your invention ought to be patented or be protected in some other way, we can offer specialist advice.

Authors at Risk of Non-Payment Through Volunteer-Run Libraries

Concerns have been raised as to whether the UK Government is breaking EU Copyright laws relating to volunteer-run libraries payment commitments. Nicola Solomon, chief executive of the Society of Authors (SoA), drew attention to the decreasing rates of authors’ compensation because of the increasing number of volunteer-run libraries, replacing traditional public libraries.   Under the EU’s copyright Directive in relation to rental and lending rights, authors generally have the exclusive right to authorise or prohibit the renting or lending of their original works or copies of said works. These authors are entitled to a "single equitable remuneration" in order to compensate for those who loan out their works. 

Yet the Directive state that EU member states may derogate from that "exclusive right" where it concerns public lending, such as public libraries, and they may "exempt certain categories of establishments from the payment of the remuneration" if they desire. In these cases the authors are entitled to receive remuneration for lending. 

However, although UK Law requires public "public libraries administered by local library authorities" to pay royalties to registered authors, under the Public Libraries Act, volunteer-run libraries are not included in this definition. Therefore, due to the wording of the act, such libraries are not required to pay royalties when lending or renting works. Solomon, on behalf of the SoA, seeked assurance that this would not result in a reduction of the overall amount paid to authors. She stated that if this were the case, "It would be unfair and deeply damaging to authors if authors were prejudiced by transfers of loans to volunteer libraries." It was also highlighted that the authors to which this would be of most damage is those whose books have ceased to be in print, yet are still being read by the public.
 

According to a report by the Guardian, The Department for Culture, Media and Sport (DCMS) have clearly stated that the increase in the number of volunteer-run libraries would hold no affect over the authors’ royalties payments. This is because the PLR payments are set annually and are not based on the number of loans from all libraries nationally. Instead, the royalties are based on the number of loans from a sample group of libraries. Volunteer-run libraries are not included within the sample group. However the DCMS argued that this would affect in no way the amount the authors received.

© Brian Miller, solicitor. This article may not be reproduced without the prior written permission of the author. This article reflects the current law and practice. It is general in nature, and does not purport in any way to be comprehensive or a substitute for specialist legal advice in individual circumstances.

Brian can be contacted at Stone King Solicitors.  For further news and information on legal topics of interest, please visit Brian's other blogs:

Brian Miller Solicitor's IP Blog

Brian Miller Solicitor's Computer Games Blog

Brian Miller Solicitor's Privacy & Data Protection Blog

Grey Imports- Not Such A Grey Area After All (Part 2) by Brian Miller Solicitor

(previously featured in MCV Magazine)

In a previous article we discussed how manufacturers of various products often sell their products at different prices in different countries, in order to take advantage of the different market conditions that exist around the world. We also learnt how a distributor could import and repackage goods from one EU country into another, provided it complied with five key rules, details of which are repeated below.

In this article, we learn how the rules for those distributors wanting to import and sell goods from outside into the EU (sometimes called "grey imports") differ radically from the rules relating to imports from another EC country.

Distributors have for a long time capitalised on the disparate price differentials which exist around the world. They do this by purchasing cheap games consoles in one country before repackaging them and selling them below market price in another country, usually at a reasonable profit. As this practice of "parallel importation" interferes with the manufacturers' carefully formulated pricing policies, it is not surprising that the manufacturers often go out of their way to keep their markets partitioned by making life difficult for both parallel and grey importers.

As we learnt in Part 1, one favoured method of making life difficult for the entrepreneurs is to threaten them with legal proceedings for trade mark infringement. In parallel importation (ie. contained within the EU), this issue typically arises because the parallel importer needs to open up boxed consoles to replace certain components, such as the power lead, in order to make the products suitable for consumers in the new intended country of sale. The process of opening and closing boxed consoles amounts to ‘repackaging' in legal terms and it is this which can lead to potential trade mark infringement on the part of the importer.

How to avoid trade mark infringement within the EU

Readers will recollect from Part 1 that an importer of goods from one EU country to another can escape the allegation of trade mark infringement if it complies with the following conditions:

1. The repackaging must not affect the original condition of the consoles.

2. The new packaging must clearly state who was responsible for repackaging the consoles as well as the name of the manufacturer.

3. If the importer adds any additional items to the consoles (such as power plugs or RFU adaptors) then it must make it very clear that the manufacturer is not responsible for these items.

4. The importer must give the trade mark owner advance notice of its plans to put the repackaged consoles on sale, at least 15 working days before the repackaged products are put on the market.

5. The repackaging itself must actually be necessary in order for the importer to successfully market the consoles.

Importing consoles from outside the EEA

(a) No exhaustion of rights

If an importer intends to bring consoles into the UK from outside the EU (or European Economic Area ("EEA")1), then simply following the five rules on repackaging will not provide a sufficient defence to a claim of trade mark infringement. In this situation, different legal principles come into play.

EC law has a principle known as ‘exhaustion of rights', which applies to a trade mark owner which has put its goods on the market in one EEA Member State. If a manufacturer puts its games consoles on sale in Germany, then under EC law that manufacturer will have ‘exhausted' its ability to use its trade mark rights to prevent parallel importers from reselling the consoles in other EEA Member States, as long as the importers comply with the five rules above.

The European Court of Justice ("ECJ") has, however, made it clear that there is no corresponding principle of ‘international exhaustion' of rights under EC law. (By ‘international' the court means here a movement of goods from outside to inside the EEA). Furthermore, the ECJ has ruled that no EU Member State can introduce national legislation providing for the international exhaustion of trade mark rights, as this would allow grey importers to import goods from outside the EEA into that Member State and from there into the rest of the EEA. This would effectively allow the international exhaustion of rights on the whole of the EEA indirectly.

So if, for example, Italy attempted to enact laws which allowed Italian grey importers to import products which had been put on sale in Taiwan, regardless of any EU or Italian trade mark rights of the manufacturer, then those laws would be held by the ECJ to be contrary to EC law, which takes precedence over Italian law.

(b) The issue of consent

The issue of the international exhaustion of rights has been considered by the ECJ and the British courts on several occasions, particularly in the cases of Silhouette (1998), Sebago (1999), Davidoff (2001), Levi Strauss (2002) and Quicksilver (2004). The following principles have emerged from these cases.

If a manufacturer puts its consoles on sale outside the EEA, the only way in which that manufacturer could be said to have exhausted its trade mark rights within the EEA in relation to any importer of those consoles from outside the EEA is if the manufacturer had ‘consented' to those consoles being resold in the EEA.

It is up to the grey importer to prove that such consent has been unequivocally given by the trade mark owner. Consent can be inferred by the particular facts and circumstances in which the manufacturer has put the consoles on the market - but it is important to note that consent will not be implied where the manufacturer has simply remained silent on the issue.

Suppose that a manufacturer was selling its consoles to a distributor in Mexico, and that the distribution agreement between the parties was silent on the issue of whether the manufacturer consented to the consoles being resold into the EEA. In such a case, consent would not be implied and any grey importer who buys consoles from that Mexican distributor for ultimate sale in the EEA will find it very difficult to rely on the ‘consent' defence in a trade mark infringement lawsuit brought against it by the manufacturer.

Of course, if the distribution agreement happened to contain an express provision stating that the manufacturer did consent to the consoles being resold in EEA territories then the grey importer would be in a much better position, assuming that it is able to produce a copy of this agreement in any potential court case. However, console manufacturers are highly unlikely to give this kind of express consent in their contracts, as they will no doubt be well aware that this would damage their ability to partition markets.

The test for consent is therefore a tough one, and it seems that the only reliable ways for a grey importer to prove that express consent has unequivocally been given are (i) to ask the manufacturer to grant its express consent in return for a fee, or (ii) to ask the distributor for a copy of its distribution agreement with the manufacturer if this happened to contain an express consent provision.

It is crucial that the consent is obtained from the owner of the trade mark itself. In this article, we have assumed that the manufacturer owns the trade mark in question, but in practice this may not always be the case. The grey importer must therefore carefully investigate the ownership of any relevant trade marks. In addition, there may be complex chains of distribution at work, and it is important that the grey importer does not rely on any consents given by distributors alone. While a distributor may have a licence to use a trade mark for selling consoles in certain territories, the question of whether that distributor consents to the consoles being resold in the EEA is irrelevant. What matters is the consent of the trade mark owner, and this can only be given by the trade mark owner itself.

Conclusion

Any grey importer who is considering importing games consoles into the EEA from a country outside the EEA and in which the consoles have already been put on the market must ensure that it is able to prove, one way or the other, that the trade mark owner has given its express and unequivocal consent to those consoles being resold in the EEA. If the importer is aware that the manufacturer actively objects to the consoles being marketed in the EEA, then it should not proceed with its plans. Likewise, if the importer is unaware of the manufacturer's stance, then it would be ill-advised to proceed.

The grey importer who ignores the issue of the manufacturer's consent, like the parallel importer who ignores the five rules on repackaging, runs the very real risk of being on the wrong end of a lengthy and costly trade mark infringement lawsuit.

© Brian Miller, solicitor. This article may not be reproduced without the prior written permission of the author. This article reflects the current law and practice. It is general in nature, and does not purport in any way to be comprehensive or a substitute for specialist legal advice in individual circumstances.

Brian can be contacted at Stone King Solicitors.  For further news and information on legal topics of interest, please visit Brian's other blogs:

Brian Miller Solicitor's IP Blog

Brian Miller Solicitor's Computer Games Blog

Brian Miller Solicitor's Privacy & Data Protection Blog

1 The EEA comprises all of the EU Member States together with Iceland, Liechtenstein and Norway.