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Copying without infringing: conference report 2

By Johanna Gibson, David Pearce, Jeremy Phillips and Ilanah Simon.

Darren Meale (Herbert Smith) then discussed the question whether the European Court of Justice has killed fair competition following its decision in Case C-487/07 L'Oréal v Bellure and the application of its ruling by the Court of Appeal for England and Wales (noted by the IPKat here).  This case involved, among other things, the legality of a maker of smell-alike scents using the trade mark of a leading brand as a reference point in a product comparison chart.

Darren took the audience through the function of the trade mark as viewed through the Bellure decision, explaining how the essential function of indicating the origin of goods and services has been complemented by the functions of communicating, investment and advertising -- terms the meaning of which, Darren suspected, the Court had not fully considered. Darren also reviewed the concept of "unfair advantage" and the need to consider the intention of the alleged infringer -- factors which may render a course of business action legal if done by one person but infringing if done by another.

Interflora -- may provide answers to questions still unresolved

Moving on to misleading and comparative advertising, the issue on which Bellure ultimately turned, a literal interpretation of the ECJ's ruling would suggest that all comparative advertising which used another's trade mark was unlawful where it was the purpose of indicating that the advertised product possessed an essential characteristic of the product with which it was compared, which cannot have been what was intended. Darren hypothesised that the decision was more concerned with a specific type of product in a particular commercial sector than with trade mark law as a whole.  He summarised the effect of the decision, which was to make advertisers far more cautious in the use of comparators. Darren's "free-riding" spectrum chart for fair/unfair uses -- ranging from traditional counterfeiting at the "unfair" end to "satisfying consumer demand for a new, breakthrough product -- was particularly useful, as was his effort to filter the Google AdWords ruling into the equation. In conclusion, Bellure has raised more questions than it has answered, some of which will be answered in the ECJ's Interflora reference.

Starbucks cup cosy -- looks prosaic, but patent-protected

Last speaker before lunch was Trevor Cook (Bird & Bird), who spoke on patents: are they immovable obstacles for competitors, or mere paper tigers? Trevor took us through a logical procedure: (i) is there a patent? (ii) what does it cover? (iii) is it infringed? (iv) is it truly valid?  After considering these criteria a third party business can make its decisions and decide whether to take any related risks.

Is there a patent?  It might not yet be granted, but the use of a patent application's contents may still be unlawful if it proceeds to grant. It's worth also checking whether and for how long it's in force.  It may be worth waiting for an impending expiry date before using it.  And where is the patent in force? Sometimes an invention is only protected in only a small number of markets.

Even simple words like vertical may not mean what they say ...

What does a patent cover? The product itself might be protected, or just a way of making it. This can have vital consequences for unlicensed users, since the definition of infringement differs as between these types of patent.  Trevor also warned of the dangers of neglecting 'contributory infringement' , where a business supplies parts for an infringing manufacture.

How many changes need be made to a patent before it won't be infringed?  There's no hard-and-fast rule, warned Trevor, since it all depends on the nature and number of claims contained in the patent -- which need not be interpreted literally.  Terms such as "a generally elliptical cone" shape have been interpreted quite purposefully, which can catch out third parties who make quite specific changes over the invention as claimed.

Defences to patent infringement include private and non-commercial use, use for purely experimental purposes relating to the subject of the patent, and -- where appropriate -- an implied licence. Parallel importation obeys different rules relating to consent to reimportation from those which apply to other IP rights.

Moving on to competition law -- when will it come to the rescue of an alleged infringer? Pretty well never, said Trevor, who could think of no case in which it had succeeded as a defence to a patent infringement action.  In the ICT (information and communications technology) sector, competition law will be directed at the formation of patent pools etc and may be used as a ground on which to seek to strike out a defence.

Challenging a patent is often the best strategy for an unlicensed user -- in 2009 two thirds of patents challenged in UK litigation were held invalidated.  Removing a patent completely clears the path for commercial exploitation, particularly in areas in which, if even a patent is allowed to remain, a business may be stopped in its tracks by an interim injunction.  Finally, Trevor alluded to the advantages of seeking a non-binding Comptroller's opinion on validity or infringement -- a cheap and underused facility which could still be highly useful.

Full post as published by IPKat on November 17, 2010 (boomark / email).