From March to September 2016 the team is joined by Guest Kats Emma Perot and Mike Mireles.

From April to September 2016 the team is also joined by InternKats Eleanor Wilson and Nick Smallwood.

Thursday, 29 September 2016

Brexit - who has the power to change UK law?

There are two kinds of general European Union laws. EU Regulations are directly effective in all member states.  In the UK, this is recognised by Section 2(1) of the European Communities Act 1972, which provides that:

All such rights, powers, liabilities, obligations and restrictions from time to time created or arising by or under the Treaties, and all such remedies and procedures from time to time provided for by or under the Treaties, as in accordance with the Treaties are without further enactment to be given legal effect or used in the United Kingdom shall be recognised and available in law, and be enforced, allowed and followed accordingly...

EU Directives are not directly effective, and need to be enacted in each member state in order to achieve the goal set out in the Directive.  In the UK, this is sometimes done by primary legislation (Act of Parliament), which is, for example, how the Trade Marks Directive (89/104/EEC, later repealed and replaced by EU Directive 2008/95/EC and then further amended by Directive (EU) 2015/2436) was implemented as the Trade Marks Act 1994.

But a Directive can also be implemented by secondary legislation - a Statutory Instrument in the form of an Order in Council, which receives only minimal Parliamentary scrutiny.  The power to do this is set out in Section 2(2) of the ECA, which provides:

Subject to Schedule 2 to this Act, at any time after its passing Her Majesty may by Order in Council, and any designated Minister or department may by order, rules, regulations or scheme, make provision—
(a) for the purpose of implementing any EU obligation of the United Kingdom, or enabling any such obligation to be implemented, or of enabling any rights enjoyed or to be enjoyed by the United Kingdom under or by virtue of the Treaties to be exercised; or
(b) for the purpose of dealing with matters arising out of or related to any such obligation or rights or the coming into force, or the operation from time to time, of subsection (1) above;
and in the exercise of any statutory power or duty, including any power to give directions or to legislate by means of orders, rules, regulations or other subordinate instrument, the person entrusted with the power or duty may have regard to the objects of the EU and to any such obligation or rights as aforesaid.
It was a departure from the previous general constitutional order in the UK that legislation could be made, and even primary legislation amended, by secondary legislation.  The Designs Directive was implemented in this manner, wherein SI 2001 No. 3949 amended the Registered Designs Act 1949 to produce an effectively entire new act, within the shell of the original.

Some readers may recall that the constitutionality of this was challenged in the case of Oakley v Animal, reported by the IPKat here.  The argument was that where the Directive allowed some latitude in the manner of its implementation, the decision as to which of several available options to adopt was a matter of legislative discretion that constituted a power not given to a Minister under Section 2(2) ECA, but required an Act of Parliament.  That argument was rejected.

The Registered Designs Act has been further amended by primary legislation, for example in the IP Act 2014.

It is estimated that there are 1000s of Statutory Instruments (nobody knows the precise number in force) made under s 2(2) ECA, and so it is of great concern what happens to them if the UK leaves the EU.  While some commentators have argued that the ECA does not have to be repealed on departing the EU (it can remain in place but with no "rights, powers, liabilities, obligations and restrictions from time to time created or arising by or under the Treaties" to bite on), many assume that it will have to be repealed or at least amended.  It was for that reason that the IPKat was keen to know what is the default position if the ECA is repealed.  Scott Wortley has in response blogged an argument, that this Kat finds compelling, that the SIs will fall away if the ECA is repealed.

But in fact, whatever is the default position, before any exit from the EU, some functionary will have to scrutinise all the SIs in force and decide which should stay, which should go, and which should be retained in amended form.  There are some SIs, such as SI 2001 No. 3949 amending the Registered Designs Act 1949 mentioned above, that it would be pretty catastrophic to lose.  Some will be clearly in applicable or nonsensical if the UK is not in the EU, and these will need to be repealed.  Others it will be probably be desirable to retain, but they may refer to an EU institution or law that no longer applies and they will need amending - the problem is that this will then probably need to be done by primary legislation, and where will the Parliamentary time come from?  A blanket saving or repealing provision will not suffice - there needs to be decision taken on each individual SI.

Against this background, this Kat finds it rather surprising that the Government considers that the taking and notifying a decision to leave the EU is a prerogative power and not a Parliamentary power.  Moreover, until yesterday its reasons to think this were secret.  There is shortly to be heard in the Divisional Court of the Queen's Bench a legal challenge to the proposition that the Government can take a decision to leave the EU and notify this under Article 50 of the TEU without any Act of Parliament.  (There is a similar challenge being heard in the High Court in Belfast). But the Government secured an order (at the hearing that this Kat reported here) keeping the submissions secret, until yesterday when this was successfully overturned by the challengers.  So now, the arguments of both the challengers and the Government can be read - see here and here.

This Kat is not an expert on constitutional law or international law, although he is learning more and more about it as these events are unfolding, and so will not attempt to comment in detail on the arguments.  In summary, however, the Government's legal position appears to be that signing up to international treaties is a matter for the Crown, not Parliament, and is not justiciable by the Courts.  But this seems to be only partially true.

Signing up to a treaty happens in two stages.  First, the treaty is signed, but at that stage it has no legal effect.  Then, at least in the UK procedure, if the treaty has an effect on domestic law, Parliament must pass an Act conforming UK law to the requirements of the treaty.  Then, and only then, can the treaty be ratified, whereupon (once the treaty comes into force) it becomes legally effective with respect to the UK.  While the procedures of signing and ratification are Crown acts that are performed by the Government under prerogative powers, the requirement for an Act of Parliament in between effectively gives Parliament the ultimate decision as to whether the UK becomes bound by the treaty.

This process can be seen, for example, in respect of the Unified Patent Court Agreement.  It was signed by a Government minister in 2013.  But then in the IP Act 2014 Parliament gave the Government the legal power to enact a Statutory Instrument to give effect to the UPCA, and this was enacted as the Patents (European Patent with Unitary Effect and Unified Patent Court) Order 2016 - SI 2016 No. 388 passed on 12 March 2016.  Only now can the Government deposit an Instrument of Ratification, which of course it has not done because of the intervening Referendum result.  (A similar order of events happened with the Patents Act 1977, which enabled the ratification of the European Patent Convention.)

Similarly, if Parliament had not passed the ECA 1972, the UK would not have been able to join the European Communities (as they then were).

So it seems odd if the Government can take a decision under Article 50(1) and notify it under Article 50(2) TEU, which will inevitably result in the UK leaving the EU, without the equivalent intermediate step of a Parliamentary enactment.

Another way of seeing the inconsistency of the Government argument is this.  If the Crown has the power to leave the EU without Act of Parliament, then it has always had it.  The Referendum Act contains no provision that alters the constitutional position - it provided for a referendum on EU membership, defining the question to be asked, but without specifying what was to be done with the result.  For that reason it is often referred to as "advisory".  Therefore, if the Government has the power to take the UK out of the EU today, then it equally had the power one year ago.  But I do not think anyone would have seriously argued before the Referendum that the Government could take the UK out of the EU under prerogative power without any Parliamentary approval.

The Government argues that Parliament will of course have a role in any repeal or amendment of the ECA 1972 and other EU-related legislation during the leaving process.  But since Article 50 leads inevitably to the leaving of the EU (at least according to most commentators, and this seems the most likely correct interpretation), then once a notification of a decision to leave the EU has taken place, Parliament has no choice but to repeal or amend EU-related legislation according to the new reality.  It is deprived of any genuine political decision-making power.

This Kat will be following the Court cases with great interest.  For commentators more knowledgeable than him, he suggests David Allen Green, who blogs as Jack of Kent.  In the meantime, comments are warmly welcomed.


Book review: Computer Crimes and Digital Investigations

Would-be computer criminals be warned, the law is slowly but surely catching up with you.  In Computer Crimes and Digital Investigations, 2nd edition, Ian Walden provides an updated version of his 2007 treatise on legal aspect of computer crime.  One area of interest for IPKat readers will be discussions on online IP crime and the use of computer evidence in computer crimes.

Walden provides a comprehensive explanation of the various key terms and approaches in legal aspects of cyber crime. He classifies crime using the Council of Europe's Convention on Cybercrime categorisation, which divides crime into three areas: computer-related crime (the computer is the instrument for the crime, such as hacking), content-related crime (e.g. copyright infringement and child pornography), and computer-integrity offences (e.g. viruses).

Cat caught in the act
Amelia on a MacBook Pro, Brownpau
As we move to a more knowledge-based economy, the role of intangible assets is increasing.  One of this Kat's favourite subjects is trade secrets. Walden notes a subtle distinction in the protection of trade secret between rights, "granted to trade secret information itself and protections triggered by the means of obtaining the information." Conspiring to defraud, for example, addresses the value of the information (trade secret protection), and computer misuse deals with the means of theft (means).  Walden details the increasing trend of trade secret protection moving from civil to criminal law.

Walden devotes a section to intellectual property crimes, namely infringement of copyright [Merpel notes that trade secrets, ever the poor relation of IP, are in a separate section.] He notes that the Convention on Cybercrime only addresses copyright and related rights infringement, not other IP, details the various cases and statutes, and notes a trend for rightsholders to seek redress via communication services providers (e.g. ISPs.)

Does the evidence add up?
John Thaw by Bill Strin
A longstanding question in online copyright infringement is evidence, as detecting and proving infringement is a challenge.  Walden divides law enforcement techniques into ordinary (e.g. searching on the internet), coercive (use of police powers such as search and disclosure), and covert (interception, surveillance etc.) [Merpel has been nostalgia-watching a lot of Inspector Morse recently, and is happy to note he uses all three techniques.] He describes the chaotic development of cybercrime evidence and evidence gathering. There are number of remaining challenges, including difficulty linking virtual identity to real-world people (identity problem), associating online data to physical locations (location problems) and the amorphous nature of data (its lack of stickiness.) These problems continue to challenge evidence used in online copyright infringement cases.

I found Walden's clear approach to categorising aspects of each topic helpful.  The appendix includes nearly 75 pages of legal texts, including the Association of Chief Policy Officers Good Practice Guide for Digital Evidence. The comprehensiveness of the book makes it both a good reference, and an interesting analysis; it will appeal to legal scholars and professionals, and the odd Inspector Morse fan (not a tautology.)

Walden, Ian. Computer Crimes and Digital Investigations. Oxford, United Kingdom: Oxford University Press, 2016. ISBN: 9780198705598 Available for £95 in hardback. Rupture factor: High, a hardback with nearly 560 pages.

Wednesday, 28 September 2016

European business urge continued UK involvement in UPC on eve of Competitiveness Council meeting

Last time the AmeriKat wrote about the
Competitiveness Council and the UPC
she was a mere kitten
It was November 2011.  The AmeriKat was spending her post-trial downtime reporting on the pending unitary patent proposals and the frenetic activity at the Competitiveness Council (see posts here).  Five years later, the UPC looked like it was ready to happen. Then Brexit.  And now, with a sense of déjà vu, the Competitiveness Council is back.  Tomorrow at around 2:30PM CET, the Competitiveness Council will be discussing, as AOB, the unitary patent and UPC (and also the review of the SPC system - for those who are less in love with the UPC).  It looks to be a public session so should be webcast here, with a press conference to follow here.  The background brief published yesterday states that:
"The Council will take note of a report on the progress made towards setting up the unified patent system and the situation concerning ratification of the Unified Patent Court agreement." 
The report from the Presidency to the Council dated 19 September 2016 provides a succinct summary on the state of play of the unitary patent and UPC.  The key section can be found in the Annex to the report which was prepared by the Chairs of the Select Committee of the Administrative council of the EPO and of the UPC Preparatory Committee.  The Annex states:
"According to the official timetable of the Committee the Court could be operational in early 2017. This was based on the assumption that the required ratifications where received during the fall of 2016.  
The outcome of the UK referendum has had consequences on the UK ratification process. The time-plan, therefore may have to be revisited.  
It is highly desirable to keep any delay of the entry into force of the system to a minimum in order to provide the business community with the clarity and the swift entry into operation of the new patent system they require."  
In advance of the tomorrow's meeting, numerous organizations have written to the Council as follows:
  • Letter from Business Europe - click here
  • Letter from UJUB - click here
  • Letter sent by Michel Guilbaud (DG MEDEF) to Philippe Léglise-Costa, Secretary General of SGAE  - click here
  • Letter by several companies (including Air Liquide, Boehringer Ingelheim, Bayer, Audi, Bosch, SAP and VW) to Mr Kris Peeters (Deputy Prime Minister, Belgium) - click here  
A theme that emerges in the letters is that (i) politicians need to find a way to get the system up and running and, with respect of some of the communications, (ii) politicians need to find a way in which to retain the UK in the system "that remains sustainable even after the Brexit" (to quote BusinessEurope).

The letter to Deputy Prime Minister Peeters states:
"In the wake of the political unrest seen in Europe in the summer, we find it timely to give a clear message to responsible politicians that we, the signing companies and industry associations, welcome the new patent system and urge that it should enter into force as planned, without delay. 
The attractiveness of the system would increase with a long-term participation of the United Kingdom. Therefore we also urge that solutions for such inclusiveness are considered."
The letter from MEDEF states:
"Pour les entreprises, l'attractivité du système serait accrue si la participation du Royaume-Uni pouvait être assurée sur le long terme et ce point devrait faire partie des solutions recherchées."
BusinessEurope's letter continues:
"Member States should make all possible efforts to bring the Unitary Patent package into life in 2017 as planned and to immediately start working on any necessary changes or additions to the legislative framework."
The German Bar Association's recent position paper took a harder line stating that "a quick decision of the UK is needed" on whether it will ratify the UPC Agreement with the view that if there is no quick ratification, then "an alternative solution should be found to allow the court system to start its work as planned".

The IPKat recently wrote on the legal opinion from Richard Gordon QC and Tom Pascoe of Brick Court on the legal feasibility of the UK's post-Brexit UPC participation (see here).  Legal feasibility is one hurdle, but the higher one in this landscape is politics.  Will the political hurdle of the UK's participation in the UPC post-Brexit be lowered in light of these comments? In a political environment where Prime Minister May is applauded for her "under the radar" approach, it seems unlikely to Merpel that any noise, no matter how positive, from European industry will make the UPC politically palatable to the current UK regime, at least publicly.

Against this background, the AmeriKat's words in a May 2012 post on the timing of the UPC seem oddly fitting now:  
"The AmeriKat cannot say whether the hands on the unitary patent clock that are ticking away as she types are counting down to an expected implementation of the patent proposals that have preoccupied the patent community for the past year [over 40 years] or to yet another legislative death when the proposals for the Utopian ideal of a unified European patent system fail to bring fruit."
The countdown has seemingly begun again, but the stakes seem to be even higher.   The IPKat will be back tomorrow to report on the Competitiveness Council's session tomorrow and future debates on this topic.

Wednesday Whimsies

Eleonora has keeping IPKat in the loop
as the new rules emerged
IPKat's very own Eleonora Rosati has been featured in a recent Financial Times piece, "Old media hopes to benefit from new EU copyright rules" available here [behind a paywall -- alternatively accessible via a search for the article title on the search engine of your choice]. The piece tackles the proposed EU copyright reforms from policy, consumer and content hosting perspectives. For more of Eleonora's own coverage of the new copyright package, it can be found here.


International Workshop on “IP-Protection of Biological Inventions"
This workshop is recommended to academics and practitioners in the field of biological inventions. Amongst the topics to be covered are the Budapest Treaty, disclosure requirements and equivalent national law provisions. This will all take place on 10 November in at the University of Basel  in association with VIPS (Federation of industry patent attorneys in Switzerland). For more information, please see here. Registration will close on 28 October.



Like the cats from the old poem, IPKat is
incurably given to roam.
WIPO Roving Seminars. Free WIPO seminars about their Services and Initiatives rove all over the world. The next seminar is taking place on 13 October  in Ikast, Denmark. As well as featuring topical panel discussions and presentations, these are a great opportunity to network over coffee or lunch. More information is available here. Upcoming seminars will take place in Oslo (here) and Bologna (here).


Brexit update. In a recent post about the UPC after Brexit (here), IPKat queried what happens to statutory instruments made under the European Communities Act 1972 (ECA) if the ECA is repealed? A big Kat pat of gratitutde goes to Scott Wortley for his detailed answer here, and to everyone who eng@ged with us on twitter. It seems that the repeal of the ECA will by implication repeal the secondary legislation. However, this is only the case to to the extent that there is no "contrary intention" to save the legislation made under the ECA.

Tuesday, 27 September 2016

Book review: Global Governance of Intellectual Property in the 21st Century

Navigating through intellectual property law and policy on the global stage can at times feel like being an apocryphal blind man trying to describe an elephant. The aspects and impressions are so different that without a broad outlook and a sharing of experiences, it is quite impossible to see the full picture. As Francis Gurry put it at the CIPA Congress 2016 earlier this month, the world is just too complex for a single global IP strategy.

This principle is highlighted by Mark Perry's (ed.) Global Governance of Intellectual Property in the 21st Century, available from Springer here.

This book offers some fresh and contemporary perspectives on IP governance. By way of introduction, it promises a wide selection of intellectual property topics and invites readers with expertise relating to one aspect of IP or one geographic location to discover more about the wider governance framework.

The content really does deliver on this promise, being a selection of chapters by various authors from around the world. On the whole, they provide consolidatory, useful comparisons between IP rights and between countries which generally make the subject matter both accessible and engaging.

Probably for reasons of space rather than style, once or twice some important new issues seemed to appear in chapter conclusions which had not been mentioned in the main body of text. Still, given the range of topics covered it remains a suprisingly concise and slim volume - shoulder bag and toe-friendly. This Kat also considered the topics were very well selected.

The chapter on Chinese prior art provides a clear introduction to a specific matter of policy which initially feels familiar to western students of IP, but with some distinctly Chinese twists which are clearly laid out by the author, Lijuan Liu.

A later chapter deals with CJEU-made law relating to originality in copyright. Here, Thomas Margoni presents some original analysis of the CJEU standard against the backdrop of civil and common law incarnations.

Particular highlights for this Kat were two fascinating chapters on trade marks, in a row: one on trade marks and domain names, and the other on "non-conventional" marks. The background to the Uniform Domain-Name Dispute-Resolution Policy is rich, and Heather Ann Forest explains the topic and the legal tensions extremely well.  The chapter on non-conventional marks offers a fresh perspective, which feels very current and resonates with contemporary ideas about branding. This is brought to life by Llewellyn Joseph Gibbons' colourful use of examples.

So much more ground is covered  - including the ASEAN market, Foreign Direct Investment Agreements, intermediary liability in Australia and a thoughtful reflection on the Marrakesh Treaty. On the whole, a fine balance is struck between different legal systems and IP rights.

The final chapter is co-authored by the editor, Mark Perry, and Kylie Lingard. It explains the importance of patent mapping in areas such as crop innovation in order to avoid the "tragedy of the anticommons", and also showcases Perry's modelling tool, Patentomics. Mapping the relationships between patents may feel intuitive, but it is clearly easier said than done to present the spidery web of relationships visually. Patentomics is a stylish, easy to use tool which clearly has massive potential for innovators to navigate around the patent landscape.

The book neatly captures the challenges faced in global governance of IP and makes up an interesting mosaic through each snapshot. It is well worth a read for anybody with an interest in international policy.

Perry, Mark (ed). Global Governance of Intellectual Property in the 21st Century. Springer International Publishing Switzerland 2016. ISBN: 978-3-319-31176-0 (Print) 978-3-319-31177-7 (Online). Available here.

Never Too Late: If you missed the IPKat last week #Nevertoolate

Distracted by something strange in your neighbourhood last week? Forgot to read the IPKat with as much attention as usual? Don't worry, the IPKat team can always be relied upon to answer the call for a quick summary: here's the 115th edition of Never Too Late.
Who you gonna call?

Book Review: Arnold reviews "Economic Approaches to Intellectual Property"

This new book by Kat Dr Nicola Searle and Martin Brassell provides an introduction to the economics of intellectual property for lawyers, managers and policymakers.

The English approach to obviousness - It all depends on the facts?

A lively discussion of the English approach to obviousness as applied in the Hospira v Genotech patent revocation application. Darren Smyth says "the insistence on the statutory question as the sole standard for assessing obviousness is welcome as a matter of law, but the multi-factorial and fact-dependent nature of the assessment must make it difficult to predict how an English court will judge the validity of a patent."

AIPPI Congress Report 3: Biosimilars – similar but different?

Catch up on the AIPPI Pharma panel session dedicated to the burgeoning world of biosimilars. Panellists from Pfizer, Sandoz GmbH and Taiwan's National Yunlin University debated the global regulatory, substitution and interchangeability issues affecting biosimilars, before giving an overview of relevant patent litigation strategies. Thanks to Bristows patent litigator Vanessa Rieu for the story.

AIPPI Congress Report 4: Lawyers who lunch - role of experts in litigation and the EPO in the 21st Century

EPO President Benoit Battistelli stressed the importance of quality and efficiency at the EPO in the face of an increasing quantity and complexity of applications. Report from Baker & Mckenzie LLP's Tanvi Shah.

Law & Economics - The Italian Edition

Nicola Searle reports from The European Association of Law & Economics (EALE) conference in Bologna.

Friday Fantasies

Roundup post of the week's news and forthcoming events.

Latest thoughts about Brexit and the UPC

Ellie Wilson analyses the recently published Opinion by Richard Gordon QC and Tom Pascoe, which says that it is potentially legally possible for the UK to participate in the UPC following Brexit.

Eye ‘should’ve’ done that! – Specsavers nears approval to trade mark single word “should’ve” & “shouldve”

The Specsavers slogan story, brought to you by law student Kishan Mathy.

A song of Ice and Ice

Iceland, a country famous for the northern lights, skyr yoghurt, and their recent performance in the Euros, has made headlines this week for threatening the trade mark rights of a major UK supermarket. Emma Perot takes up the tale.

ChIPs Global Summit Report 3: Congratulations - your patent has been allowed, when is it finally final?

The Amerikat summarises the problems of a dual track system from the US perspective.


PREVIOUSLY ON NEVER TOO LATE

Never too late 114 [week ending on Sunday 18 September] | Commissioner unveils new copyright package | Open letter from Wikimedia et al on copyright package| Globalisation, Globalisation, Globalisation| Philip Morris loses investment arbitration | EPIP highlights | 20 million thanks | Tea & trade secret theft | Patent quality conference | free wifi networks & copyright infringement | Chiefs in Intellectual Property summit | Innovation and its discontents | GS Media rapid response event summary | AIPPI Congress reports
 
Never too late 113 [week ending on Sunday 11 September] Clinical trial data | Parody and free use in Germany | Infringing donuts | CJEU decision in GS Media | Fujifilm Kyowa v AbbVie | UK and the UPC | General Data Protection Regulation | Changes to IPO rules | Book review: European Patent Litigation in the Shadow of the Unified Patent Court | General Electric and 3D printing | EPLAW mock trials
 
Never too late 112 [week ending on Sunday 4 September] 3 Cubist antibiotic patents revoked| Milan Court rejects application for 'blank' blocking order | Leaked copyright draft directive| Thursday Titibits | Super Kat exclusive| Mexico's new opposition system | EU General Data Protection Regulation | Hospira v Cubist | My My Mylan | Kasting Kall for Internkats
 
Never too late 111 [week ending on Sunday 28 August] Branding and rebranding of infidelity and Ashley Madison | Passive hosting providers and third party content | Safe harbours and the E-commerce directive | BREAKING: Leaked Commission Impact Assessment | GS Media rapid response event | Singapore Copyright reform


 

Monday, 26 September 2016

The illusion of design and the design of illusion


When we think about designs, we usually focus on the visual. After all, designs are about the aesthetic qualities of objects. But there are times
when we can learn a lot about design by just considering the language used to describe it. Consider the piece written by Tim Gunn, a well-known fashion expert and former chief creative officer for then Liz Claiborne Inc. (now known as Kate Spade & Co,), entitled “Designers refuse to make clothes to fit American women: It’s a disgrace”, which was published by The Washington Post on September 8th. The thrust of Gunn’s article is that the fashion industry pays insufficient attention to what he calls women “larger than size 12.” He cites research that the average American woman wears between a size 16 and a size 18, and that over 100 million women wear a size larger than 12. And yet, not only do—
“… most designers max out at size 12, [but] the selection of plus-size items on offer at many retailers is paltry compared with what’s available for a size 2 woman. According to a Bloomberg analysis, only 8.5 percent of dresses on Nordstrom.com in May were plus-size. At J.C. Penny’s website, it was 16 percent; Nike.com had a mere five items—total.”
Make no mistake, we are talking about a large consumer segment. Over the last three years, this segment has increased spending on clothes at a pace greater than the “straight-size” segment. That might sound like a good thing, but in fact it only underscores that the fashion is doing a lousy business job in serving this clientele. Eighty percent of such women reported that they would spend more on clothing if there were more product choice in their size. Even a larger percentage, nearly 90%, stated that they would spend more on clothes “if they had trendier options.” Gunn poignantly recounts that at a fashion event that took place in 2010, one woman removed her jacket and described herself to Gunn as follows:
“Tim, look at me I’m a box on top, a big, square box. How I can dress this shape and not look like a fullback" [for non-U.S. readers, a fullback is a position in American football].
The upshot is that there exists a fashion segment that wants to buy more clothes suitable for them, but they are not able to do so because the products offered do not meet their needs and aspirations. So why? According to Gunn, the answer is that we have had a massive failure of design. He purports to rise to the challenge, declaring that—
"[t]here is no reason larger women can't look just as fabulous as other women. The key is the harmonious balance of silhouette, proportion and fit, regardless of size or shapes. Designs need to be reconceived, not just sized up; it's a matter of adjusting proportions. The textile changes, every seam changes. Done right, our clothing can create an optical illusion that helps us look taller and slimmer."
That sounds promising, until one thinks a bit about how fashion design is being described. Ostensibly, design is almost always only for the good; you can never get too much good design. “But what is a good fashion design?”, you ask. It is not a design that is merely aesthetic; after all, all designs have an aesthetic character. When it comes to good fashion, the most representative word that comes to mind is the term “sleek” or the equivalent, as the fashion models saunter down the catwalk. But Gunn is suggesting that we reformulate design to address the fashion needs of the larger than size 12 woman. If so, surely there must be corresponding vocabulary to describe this change.

Au contraire-- Gunn’s solution is merely a form of illusion. The language for his new approach to fashion design remains--"taller" and "slimmer”. All that has happened is that the language of the catwalk is applied to this "better" design of clothes for the "size 12 woman", aided and abetted by the illusion of design. Gunn’s language betrays a failure of design. The challenge is simply stated— “How can I look good and why do designers ignore me.” The solution offered would seem to be an illusion, in more ways than one.

To photocopy or not: Delhi High Courts grants universities carte blanche to photocopy for educational use

The IPKat is delighted to receive this guest post from long time Katfriend Prashant Reddy  T. (details at the end of the post) about a remarkable recent decision from India.

The recent judgment of the Delhi High Court dismissing the lawsuit filed by publishers like Oxford University Press, Cambridge University Press and Francis Taylor has been received with much joy and applause from virtually all quarters of Indian academia and students. In a 94 page judgment, delivered more than 600 days after it was first reserved, the Delhi High Court has held that Section 52(1)(i) of the Copyright Act, 1957 allows for students and teachers to photocopy books and other educational material without any limit.

The target of the lawsuit was a particular form of photocopying wherein the faculty at the Delhi School of Economics (DSE) would prescribe a reading list, usually comprising chapters from different books and a photocopying shop contracted by the university would then compile course-packs consisting of these various chapters and sell them to students, for profit. The publishers were seeking to monetise this practice by charging either the university or photocopy shop, a royalty of 50 paise per copyrighted page that was copied – a fair bargain, given the photocopier too was getting 50 paise per page. This is a business model followed in most western universities because it is unreasonable to expect students to buy an entire book for a single chapter. 

The High Court obviously disagreed with the publishers and there appears to be nobody in Indian academia who disagrees with this decision. Rather we’ve been told that the decision restores a “balance” to copyright jurisprudence and that it will facilitate access to knowledge. Unfortunately nobody explains the economics of this balancing act.

A law that predated the photocopier machine

At the heart of the dispute is Section 52(1)(i) of the Copyright Act which allows for the “reproduction of any work” by a “teacher or a pupil in the course of instruction”. This provision was inserted into the Copyright Act in 1957 – an age before the photocopier machine became commercially viable in Indian universities. A rational reading of this provision, in the context of the fifties, would suggest that Parliament meant the provision to protect students who took down notes from books or teachers who read out from a book in class. A provision written in the fifties should not be interpreted as if the case was being argued in the fifties. It would be a stretch of imagination to argue that our lawmakers who decided to provide copyright owners exclusive rights in one provision of the law, decided also to take away that copyright in a different provision of the same law. Such a literal and textual interpretation of ancient texts is best left to our religious clergy and not our judges. 

India’s international negotiating position

Separate from the issue of Section 52(1)(i) is the history of India’s international negotiation on copyright treaties. In 1967, India had famously demanded that the Berne Convention on Protection of Literary and Artistic Works be amended to provide developing countries with various exceptions and limitations for educational and other uses. At the time India, a newly independent country after almost two centuries of colonisation, had legitimate concerns with the high standards demanded by the Berne Union. One of the main demands by India at the time was to allow the use of copyrighted material for educational uses without any remuneration for users. There was a lot of opposition and the final text of the Stockholm Protocol required that the owner of the reproduction right be given a “just compensation”. 

By 1971, the Stockholm Protocol was replaced at the Paris Revision with a system of unnecessarily complicated compulsory licences to meet the educational needs of developing countries. In 1983, Indian law was amended to incorporate these compulsory licensing provisions into Sections 32, 32A and 32B of the Copyright Act. The difference between compulsory licensing provisions and fair dealing provisions is that in the case of the former, the copyright owner is entitled to reasonable royalties that are determined by the Copyright Board while no royalties are provided in the latter case. Clearly Indian policymakers in 1983 had decided that the use of works even for an educational purpose deserved to be compensated. It is of course a matter of regret that these provisions have rarely been used in India. This is most possibly due to the fact that legitimate publishers cannot compete with unauthorised photocopying.

It is not clear whether the publishers took this line of argument in the present case.    

Can and should India free-ride off western scholarship?  

The underlying presumption of those batting for a wide fair dealing exception in Indian law is that publishers will continue to publish scholarship for foreign markets and that India can continue to free-ride off such efforts. This free-rider approach has worked well for Indian in other IP debates especially the pharmaceutical patent regime. Without a patent regime, the Indian pharmaceutical industry managed to free ride off innovations in the West. But does this logic hold true even for scholarship? To an extent it does. For mathematics and sciences, which are produced for foreign markets, Indian universities can continue to buy one book and allow student to photocopy it. But what about the social sciences, economics and law – these are areas where scholarship is required to be India specific and preferably written by Indian scholars. 

Why are publishers going to invest more in publishing new titles in these areas of study when the main Indian market remains small? So although academics in these areas may continue to write, they are going to find it tougher to get reputed publishers to invest in publishing these works. The ultimate loser is going to be Indian academia.

Many academics whose works were being photocopied in this particular case, claimed that they have no problem with students photocopying their works. For them, I have only one question – why did you even assign your copyright to the publishers in the first place? Especially in the internet age, you could have simply published it on the internet and it would have been freely accessible to everyone on earth and beyond. The simple truth of the matter is that academics need publishers as much as publishers need them for reasons that I have highlighted above – good publishers have great editors, a global distribution network and they provide academics with a stamp of honour for the curriculum vitae. Each factor also impacts royalties earned by the author, no matter how meagre those royalties maybe in the Indian context given the low pricing of books. To recount an anecdote narrated by famous historian Ramachandra Guha in an essay on OUP completing a century in India in 2012: “A British historian once said that being published by the Oxford University Press was like being married to a duchess—the honour was greater than the pleasure”.   


The writer blogs for SpicyIP, is co-author of a forthcoming book to be published by OUP – Create, Copy, Disrupt: India’s Intellectual Property Dilemmas and is a Research Associate at ARCIALA, School of Law, Singapore Management University.        

ChIPs Global Summit Report 4: Facebook, Apple and the DoJ discuss the tension between privacy and security


The privacy v security panel ready for a robust
debate
On the evening of the first day of the ChIPs Global Summit, the AmeriKat surrounded herself with some more inspiring women, in the form of rising IP star, Guinevere Jobson (Fenwick & West), her mom and the AmeriKat's mom.  Over cheese and wine, two generations of women discussed how life in the workplace and expectations have changed for women and how balance can (if ever) be struck.  The issue of balance was also at the heart of the following morning's panel session on the tension between privacy and security.  The tension came to the forefront following the FBI's ex parte order served on Apple following the San Bernardino terrorist attack (see background here) requesting that Apple create new software that would allow the FBI to unlock an iPhone 5c belonging to one of the terrorists. Law enforcement agencies are concerned with protecting national security, whereas companies are concerned with losing the confidence of their customers in protecting their privacy.

In one of the AmeriKat's favorite panels of the Summit, Erin Egan (VP & Chief Privacy Officer, Facebook),  Erika Brown Lee (Chief Privacy and Civil Liberties Officer, U.S. Department of Justice), Nuala O’Connor (President & CEO, Center for Democracy & Technology) and Noreen Krall (ChIPs Co-founder; Vice President, Chief Litigation Counsel, Apple Inc) debated the tension with moderator Jeanne Heffernan (Kirkland & Ellis LLP).

The debate highlighted the detailed and subtle nature of the tension between numerous stakeholders and corporate and law enforcement objectives.  Although the panelists dove into the detail of the legislative and policy debate over 90 minutes, the AmeriKat has summarized the top eight themes emerging from the session for readers as follows:
1.  The privacy v security fallacy.  National security and personal privacy are not at odds with each other. It is a false choice - it is really security v security.  As Noreen highlighted 17.5 million people were victims of direct hacks which violated their personal privacy, but importantly they were also victims of crime.  Privacy is a security issue and security is a privacy issue.  People who put products into the marketplace want to stop crime at the onset and law enforcement want to stop it once it happens.  The argument is that that you cannot undermine encryption to protect customer's security and privacy in the interests of law enforcement because in doing so you will inevitably create back doors which allow "the bad guys" in resulting in crime (and, therefore, threats to security).  
2.  Security and privacy have taken center stage.  The FBI's order against Apple was ex parte.  There was no opportunity for Apple to be heard.  The manner in which the FBI obtained the order (after months of working whit Apple and not under seal, so that it was public) therefore generated controversy and ignited fights between various factions on the public stage.  Noreen explained that Apple was and had been cooperating with law enforcement for months until the February ex parte order.  The FBI's order asked Apple to write a new operating system so that they could gain access to the iPhone 5c at issue which was running on iOS 9 (reportedly known internally at Apple as GovtOS).   If Apple complied with the order they would risk the security of other Apple customers.  The panel recommended this TIME article interview with Tim Cook to the audience for background reading.  The panel appreciated FBI Director Comey's efforts to keep the issue in the forefront of public discussion, but some panelists stated that his comment that an "adult conversation" was needed in the wake of the controversy was probably an unfortunate choice of words as the insinuation was that if you did not agree with the FBI, you were not an adult. Now that the "fervor" has died down, many panelists felt it was time to reignite the conversation.  
Is the privacy v security debate really a fallacy?
3. Protecting customers' security.  Customers demand secure devices and services. The counter is that if we make devices secure we lose the ability to obtain information.  What really is at stake, commented Erika, was the ability to obtain information.   There may be a perception from law enforcement that you are trying to create an impenetrable device - but that is impossible.  These are human-developed systems.  All that companies, like Apple, are trying to do is to stay ahead of the "bad guys" who want to gain access to customers' data.  Humans will always be able to get into devices (indeed, the AmeriKat notes, the FBI found a way into the phone with the assistance of a third party - see Washington Post article here).  Erin explained that "for the trust of the people who use our products, we have to strengthen our security.  If we are not [permitted to provide] end-to-end encryption, there are numerous people outside of the jurisdictional reach of the US who can and people will use those services."  In those circumstances, when law enforcement wants information they are at a disadvantage and will not be able to obtain metadata.  US companies and law enforcement will then both be at a competitive disadvantage.   
4.  Judiciary is getting this right?  Some panelists noted that the judiciary seems to be getting the balance between privacy and security right in the few instances where it has had to rule.  Just because technology has expanded into every sector of our life, it does not mean that the role of federal government in our lives is automatically expanded.  The Supreme Court has held firm that there is a strong boundary between privacy and security, upholding the strength of the Fourth Amendment with limitations (Riley v California) .  The Courts also recognize the limits to how much information is actually held on devices and that 90% of people who have phones have some sort of digital information about themselves contained therein.  In the absence of a plethora of court cases, it was noted that a more robust debate on these issues was needed.  
5.  Mixed messages on a global scale and the shadow of data localization.  The panel noted that there is real tension between law enforcement and data protection authorities.  When working with data protection authorities around the world, some authorities do not want you to retain data and want you to get rid of it.  However, law enforcement in these same countries want you to keep it.  Some countries demand strong encryption on devices.  Other countries require easier access to data for law enforcement.  There is a perpetual conflict that companies have to navigate.  Noreen and Erin stated they, like many companies, are engaged in conversations about this conflict, but data protection authorities need to be speaking directly with law enforcement and security so that commerce do not necessarily find themselves in the middle.  The panel explained that there are countries around the world who are investigating crimes who want access to data from US companies about activities being undertaken in their country.  The current method to obtain this information is via the Mutual Legal Assistance Treaty, but this is a long and cumbersome process which is not always fit for purpose in a digital age.  Stakeholders are looking to fix the MLAT so it is not so cumbersome.  However, in response to this problem, some countries are enacting laws to localize data storage; there are approximately 40 laws in the works around the world on data localization.  Data localization can be a concern as there are some regimes who are not providing for localized storage for legitimate aims.   Noreen commented that she understands why countries ask for data localization in order to enhance the tools available for local law enforcement.  However, from a company perspective companies are concerned about their customer's privacy and security and experience.  Data localization can also increase costs and may also impact quality of services.
Erin Egan (Facebook) and Noreen Krall (Apple) working
to protect customer's privacy and security

6.  Concern for European start-ups in light of the GDPR.  The panel also noted that the US and UK are working together to share data - it is proposed that US companies holding data can share that data with UK authorities and vice versa.  The proposal before Congress involving the US and UK was said by a member of the panel to "really lift restrictions from companies for [the sharing of] different types of data."  The proposal involves collaborative measures between law enforcement and service providers (see summary of the legislative proposal here) and was commented that the sharing would be similar to the information sharing provisions under the Cybersecurity Information Sharing Act which came into effect last year.  Companies on the panel also explained that they are spending a lot of time on the new General Data Protection Regulation (GDPR) in Europe.  They are in the process of combing through the GDPR's provisions.  Some on the panel felt that there was a "paternalistic view" of the authorities knowing what is best for the public, as against the notion of the "self" and people being in control of their own data.  However, as companies "we have responsibilities to make sure people understand what is going on and how they can exercise control" with respect to their data, explained Erin noting in particular Facebook's privacy health check-up.  Customers are at the center of this process.  Facebook is constantly innovating to find ways to ensure people understand their rights and privacy options.  There was concern expressed in the panel about how start-ups could ever get off the ground in Europe in light of the GDPR as even sophisticated companies need a team of 15 lawyers to identify their obligations on the legislation.   
7.  The consequence of cheaper and easier data storage.  With easier and cheaper data storage (see in particular cloud storage), companies are able to identify customer trends over a long period of time.  Companies use this data to predict their customer's needs (see your customer experience on Amazon).    The amount of data stored on customers - be it on Facebook or Amazon - is reaching 20 years.  Think about what has happened in your life in 20 years.  Graduating college, getting married, having kids.  The data about you is enough for a family history.  This creates a luxurious data pool upon which to conduct sales and trend analysis to recommend products to you (see for example, the story of Target predicting that a teenage girl was pregnant before her father knew - here and here).  As long as everyone knows that companies are using that information for this reason, this is fine.  However, how do you minimize the risk to the individual and company in the storage of long term data, while maximizing the utility of the information?  But we also have incredibly useful data that could be potentially used to identify health trends and risk areas for the greater social good.  How do we use this data as part of a larger link analysis without unique identifiers?  There were no immediate answers to these complex questions.  However, there is some vocal groups that oppose the storage of data long term so that it cannot be used for such trend analysis. Further, the more data stored, the more data is at risk of cybersecurity attacks and the more data that is at risk of being turned over to law enforcement.  Companies have to quantify this customer experience benefit against the security and privacy risk.
How long is your digital snail trail, and where does it lead?
8.  Future collaborative work.    It was agreed that this is the golden age of surveillance.  Everyone is leaving digital data everywhere.  We need to fund agencies to ensure that despite this digital snail trail (the AmeriKat's words, not the more eloquent panel's), the public is kept safe.  The panel suggested more funding for national security agencies to retain and train the best and brightest to help find a resolution of these issues from a technical and legal perspective.  It was also suggested that we move beyond the encryption conversation as neither party - companies, nor law enforcement - want to be disadvantaged (as noted above).  There also needs to be an increase to transparency.  The panel noted that with the impending election, there will be new faces in government.  However, it was hoped that the benefits and fruits of the collaboration between the private and government sectors in this area continue.  

Sunday, 25 September 2016

ChIPs Global Summit Report 3: Congratulations - your patent has been allowed, when is it finally final?

Problems, problems everywhere,but
where is the solution for the dual-track system?
The problem of a dual track system was the final session the AmeriKat attended before lunch on the first day of the ChIPs Global Summit 2016, a topic which came up at this year's Fordham IP conference (see post here).  What is the impact of a system where a patent cannot be declared finally valid, only finally invalid?  This problem has been, in part, generated by the America Invents Act with the creation of inter partes review (IPRs), which has resulted in some patentees facing serial IPRs and parallel attacks in the district courts.  In Europe, the dual track problem is between national courts and EPO oppositions where a national court may hold a patent valid and infringed only for the patent, many years later to be held invalid by virtue of an EPO opposition.  So what is the latest thinking in the US on this issue?

Judge Rama Elluru (Administrative Patent Judge, USPTO) - who was not speaking on behalf of the USPTO or Patent Trial and Appeal Board (PTAB) - stated that there was an opportunity for serial petitioners.  However where there is a subsequent challenge to the same patent, the petition is usually assigned to the panel who dealt with the first petition as they are familiar with the history, prior art and arguments.  When the same petitioner challenges the same claims, there is a possibility for estoppel.  There is also discretion not to institute an IPR if the petitioner could have raised the challenge in the post grant review or if the petitioner is accused of harassment.  If the petitioner has already challenged validity and lost in district court and there is some evidence of undue harassment then that may be something that is taken into consideration when instituting an IPR.  However, it depends on the facts of the case.  In answer to a question as to whether the PTAB looks at a successful invalidity win in district court during their proceedings, the answer was that they "will make an independent decision based on the record in front of it."

Chief Judge Barbara Lynn (US District Court for the Northern District of Texas) first declared that nothing she said was, of course, binding on herself.  She then commented that she "loves complex patent cases but I only want to hear them once."  The worst outcome is to be reversed and remanded as its a huge expense of resource for the parties.  The America Invents Act has stymied the ability to achieve finality of a patent's validity.  The lack of finality is a real problem for certainty and especially the patentee whose fight is never over.  Chief Judge Lynn commented that the judges look at what is happening in the PTAB - what they are doing, how fast they are doing it and how the district courts and PTAB are or should be interacting.  Chief Judge Lynn stated that "I have to worry about multiple actions in my own court and actions in other courts construing the same patent that I am considering."  One has to be alert to the potential for contradictory decisions emanating from different fora.   Chief Judge Lynn noted that district court judges do the best they can to reassemble cases.  Indeed, Chief Judge Lynn explained how she and a district judge in another case concerning the same patent met to construe the patent claims together so to avoid contradictory decisions as much as possible.  Judges are therefore finding ways to work around these problems.  

The panel also noted that the presumption of validity under US patent law assists the patentee in showing that they have something of real value and that the burden of proving that the patent is invalid falls on the other side.  However, in reality if we took a poll, many would comment that there are a lot of weak patents out there.  It was suggested that perhaps the focus therefore should be on patent quality so that the presumption of validity and the standard of evidence to rebut that presumption (clear and convincing) is actually appropriate. Just because a patent has survived one patent challenge does not mean that the patent is necessarily stronger.  If the patent has survived a challenge in front of a really good judge, then the panel noted that that may deter opponents.  However, in reality, that decision is not binding on anyone who is not party to that case.  Those parties will try a different tactic before different judges in a different forum.  This is of course correct - it is not fair to an absent party to be faced with the bias of a decision in a case they had no right to participate in.  There cannot be a time bar for bringing a challenge to a patent in district court as potential litigants and controversy may not be in existence at the time of the first action.
  
Chief Judge Lynn explained that most district courts are staying cases pending inter partes reviews.  If a patent is invalidated, then that is the end.  If it is not, then the district court goes forward and may still invalidate the patent.  The district court judges pay attention and review the decisions coming from the PTAB.  There is a lot of intersection between the tracks.  However, the dual tracks create significant tension but she did not have an immediate solution - although the problem greatly demands one.  Chief Judge Lynn did note that there needs to be a way of bringing "everyone in" on the process.  

Melissa Scanlan (Senior Director, IP Litigation and Antitrust, T-Mobile USA) noted that she is usually on the defence side and, therefore, joked that she never thinks about the "poor patent owner" especially those whose patent claims are overly broad, tenuous and are asserted with a hefty multi-million dollar price tag [she didn't say it, but the AmeriKat understood her to mean patent assertion entities, or whatever they are now called].  Melissa stated that she liked "having as many tools in my patent tool chest as I can.  That includes asserting my best arguments in district court on validity and then going to PTAB in parallel and to play one off against the other where there is an opportunity to do it; there are tons of strategic decisions which go into that."  However, she recognized that it can create an inefficient system.  Inefficiency is generally a bad thing, but as a litigator you will use every tool that you can "as aggressively as I can to shift some costs back in the other direction".  Perhaps, the AmeriKat muses, that is the heart of the issue on multiple attacks in a dual track system - costs.  Would blanket wide costs-shifting deter serial attacks?   Melissa also commented that a validity assessment before a jury is almost always daunting.  There is a fear that as soon as jurors see the official stamp on the patent and watch a glittering video in court about the invention, they are then unable to look beyond that to the merits.  "We have been successful in invalidating patents, so we know it is possible.  We have done it, but we sure do not count on it.  We feel better about our chances on infringement."

If the panellists could change one thing about this dual track landscape, what would it be?  There was no consensus, however, two panellists suggested that they would rather all arguments be articulated at the PTAB and the district court case stayed until the PTAB conducts its assessment, rather than to "drag on and on in a slow expensive process in district court."

Closing the session, moderator Rachel Krevans (Morrison & Foerster) explained that the US has one system of patent laws, regardless of technology and regardless of the identity of the patentee.  However, recent history with the rise of non-practising entities has generated a lot of cynicism about the value of patents, i.e. not being worth the paper they are printed on.  However, when companies start the R&D and investment cycle for products, they need to have confidence in strong patent protection and in the patent system to assure investors that their investment will become good.

If the quality of patents being issued is in doubt and the number of times a patent will be subject to attack is almost limitless, then confidence in the strength of patent protection and the system begins to falter.  The value of the bargain struck in obtaining patent protection begins to erode.  The AmeriKat wonders whether if such a state of affairs is permitted to continue, more inventions will be protected by way of trade secrets, not by patents.  Surely, such an outcome will be classed as devastating failure of laws that were established to promote innovation for the good of society.  But who has a solution?  AIPPI has been working on a full scale global survey on this dual-track problem over the past few months to identify potential solutions.  This work will continue over the next few months and the AmeriKat will keep readers updated on this work as practitioners grapple with this problem, not just in the US, but across the world.  

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