INTER Action IP Law Update Speakers’ Notes - Locke Lordmedia.lockelord.com/files/upload/INTERActionIPLawUpdate-Speakers... · INTER Action IP Law Update Speakers’ Notes Thursday

INTERAction IP Law UpdateSpeakers’ Notes

Thursday 31 January 2013from 12:30pm - 9:00pm

Dashwood69 Old Broad StreetLondonEC2M 1QS

The Fourth Annual Edwards Wildman IP Conference


INTERAction IP Law Update31 January 2013

PROGRAMME

from 12:30 pm REGISTRATION

12:30 - 2:00 pm LUNCH

2:00 - 2:05 pm Introduction from ChairAkash Sachdeva

2:05 - 2:30 pm The lead car is unique, except for the one behind it which is identicalChristian Bedford, Legal Counsel, Williams F1

2:35 - 2:55 pm Innovations in Licensing best practiceBen Goodger

3:00 - 3:30 pm Trade Marks - European PerspectiveNick Bolter

3:35 - 3:55 pm Pick a Court… any CourtAkash Sachdeva

4:00 - 4:20 BREAK

4:20 - 4:40 pm Technology Wars: Recent Battles on the Competition Law FrontTrupti Reddy

4:45 - 5:05 pm The Social Media Revolution: What did we learn from 2012?Richard Graham

5:10 - 5:30 pm Double trouble - IP problems in IT disputes!Geoff Mendelsohn

5:35 - 5:55 pm 2013 Unlucky for some?: Will the coming year break the Internet?Gareth Dickson

6:00 - 6:10 pm Closing Remarks from ChairAkash Sachdeva

6:10 - 9:00 pm DRINKS RECEPTION

Eligible for 4.5 CPD Hours

edwardswildman.com

The Fourth Annual Edwards Wildman IP ConferenceINTERAction IP Law Update - 31 January 2013

Slides will not be distributed in hard copy.

Notes:

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© 2013 Edwards Wildman Palmer LLP & Edwards Wildman Palmer UK LLP

INTERAction IP Law Update

Innovations in IP Licensing

Ben GoodgerPartner, London

31 January 2013

Outline

A. Two Recent Cases To Concentrate The Mind When Drafting

B. EU cases With An AgendaC. Some Current Trends In IP Licensing

2

Two Recent Cases To Concentrate The Mind When Drafting

♦ Wilkinson v London SHA (Nov 2012)♦ Agreement to create training materials: some new,

some existing, some a synthesis of existing.♦ Assignment of “All IPR associated with any IP arising

from the performance of the services…pursuant to this Agreement.”

♦ What about existing materials reproduced in new work?♦ Held: assignment on unrestricted terms of created

materials which relies on implied licence of pre-existing materials must mean licence is unrestricted

♦ Implications for foreground IP / background IP?

Two Recent Cases To Concentrate The Mind When Drafting

♦ “Take 5” & “M2Trade” cases in Germany (2012)♦ Held that a sub-licence still stands, despite

termination of head licence. ♦ Likely a different result if litigated in UK.♦ US position seems more like Germany?♦ Practical consequences…?

3

EU cases With An Agenda

Pie Optiek v Bureau Gevers (19 July 2012)♦ Only entities holding prior rights in EU/member state trade

marks, based in EU, could apply for new “.eu” domain during sunrise period

♦ US based entity owning LENSWORLD trade mark licensed EU based entity to register domain lensworld.eu on its behalf

♦ Was this a true licence of ‘prior rights’?♦ Defendant argued that a licence can be of any of the

prerogatives of the TM owner.♦ Held: a licence is not a licence if we say it isn’t.♦ TM licence confers “right to use that mark for purposes falling

within the area of the exclusive rights conferred by that mark”. Present arrangement was “contrary to objectives of the Regulations”.


SAS Institute v World Programming (2 May 2012)♦ WP devised a way of making software applications work with

SAS’s programming language and formats, without copying SAS’s code

♦ WP’s user licence restricted to non-production purposes♦ Held: licensee is entitled under the Software Directive to

observe, study and test functionality of a program to understand the ideas behind it – even if this is for purposes which exceed the stated intention of the licence, and could compete with licensor

♦ Only the individual expression of the intellectual creation of the author was capable of protection by copyright.

♦ Functionality of a program beyond this – to allow protection of that, would be to monopolise ideas.

4


UsedSoft GmbH v Oracle International Corp (July 2012)♦ UsedSoft traded in ‘used’ licences of Oracle software.♦ User typically downloaded copy of the software from Oracle

website. Licence terms: non-exclusive, perpetual, for user’s internal business; NOT transferable.

♦ Software Directive (2009/24): ♦ IP owner has exclusive right to control copying, and

distribution of copies - Article 4(1)(a), (c)♦ First sale in EU exhausts distribution right re that copy

within EU (Article 4(2))♦ Reproduction of program by “lawful acquirer” to run / use it,

does not require owner’s consent (Article 5)


♦ By allowing downloading of its software, had Oracle exhausted its right of distribution? Held: Yes. Cannot evade principle of exhaustion this way: on-line transmission is ‘functional equivalent’ of sale of goods.

♦ Could Oracle prevent purchaser of the ‘used’ licence from downloading a fresh copy of the software and (where maintenance contract taken out) all patches and fixes accumulated since licence first bought?

♦ Held: No and No. This is not a new sale.♦ So: “licence” meant “sale”; and fresh “download” under

existing granted licence was not a “new” copy.♦ But: former owner must not make further use of copy he had

‘sold’; and IP owner entitled to use disabling software to prevent abuse.

5


Implications of these cases for IP licensing in EU?♦ Courts seem willing to ignore, or ‘purposively’

interpret, express language of licence, if deemed to interfere with greater policy objectives.

♦ Problem for Common Law lawyers?♦ In particular, ‘overreaching’ by IP owners liable to

be curbed / pushed back, even if it apparently flies in the face of contractual or legislative provisions.

♦ IP owner’s rights limited to defending / exploiting the ‘essential function’ of the IP right, but no more?


Implications of these cases for IP licensing in EU?♦ Overly aggressive licence drafting may need to be

revisited.♦ Especially in the software arena, these cases will

be stimulus to ‘cloud’ solutions – SaaS, PaaS etc.♦ Is that necessarily a good thing, though?♦ What about other digital transmission – films,

music?

6

Some Current Trends In IP Licensing

Proliferation of patent grants and patent litigation in last few years, has increased IP rights aggregation:

Patent Pools, Standards-Setting Organisations for standard-essential patents (SEPs)

♦ Advantages♦ Disadvantages♦ FRAND: testing what this means. Always a

tension with Competition law ♦ Upcoming Nokia v IPCom trial in UK


Other ways to encourage innovation “despite” IP: HOLnets?♦ Sharing of ‘pre competitive’ data and research,

within framework of agreed goals.♦ Problem: when do you move from open, pre-

competitive sharing, to identifying inventions or know how as commercially valuable and therefore needing to be ‘taken indoors’?

♦ ‘Members’ Charter will need to be carefully thought out and drafted

7


Making the market for using IP rights more liquid – the ‘commoditisation’ of licensed rights?

♦ Digital Copyright Exchanges ♦ “Copyright Hub” – non-mandatory registration♦ Easy to use and low transaction cost licence

♦ IXPI model ♦ Buying and selling of patent rights as units - Unit

Licensed Rights (ULRs) - like trading in shares♦ One ULR would grant holder a one-time right to use

a particular patented technology on a single product

Ben GoodgerPartner

Edwards Wildman Palmer UK LLPDashwood

69 Old Broad StreetLondon

EC2M 1QS

Direct: +44 (0) 207 556 4188General: +44 (0) 207 583 4055Mobile: +44 (0) 7970 231039

www.edwardswildman.com

THANK YOU!

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Innovations in IP Licensing

Ben GoodgerPartner, London

31 January 2013

1



Trade Marks – European Perspective

Nick BolterPartner-in-Charge, London

31 January 2013

Summary

♦ Some important cases, some interesting cases.♦ IP Translator – Mind your spec♦ ONEL/OMEL – What’s the use?♦ BIMBO – DOUGHNUTS – A Spanish problem?♦ ORACLE v M-TECH – No “Euro-Defence”

♦ Europe – the future for trade marks?

2

IP TRANSLATOR

The Chartered Institute of Patent Attorneys v Registrar of TradeMarks Case C-307/10

• Not boring!

• Technical but important - test case by CIPA

• Trade Marks are registered for listed goods and services groupedinto “Classes”

• Classes are described broadly by “Class Headings”

• e.g. Class 25 “clothing, footwear, headgear”

• Traditionally in the EU: Class Headings capture all goods/services that fall within the given class

IP TRANSLATOR cont.

The Chartered Institute of Patent Attorneys v Registrar of TradeMarks Case C-307/10

• CJEU rule that OHIM’s current policy is wrong

• Trade Marks Directive – “sufficiently precise and clear”

• Some Class Headings are “sufficiently precise and clear”, some are not

• Class Headings do not automatically cover everything within a Class

• A more literal approach

3

IP TRANSLATOR cont.

♦ OHIM’s reaction to the CJEU’s decision?

Communication No 2/12♦ CTMs filed before 21 June 2012:

♦ OHIM interprets Class Headings under “old” policy (but CJEU’s decision says this is not the right way);

♦ CTMs filed on or after the 21 June 2012: ♦ OHIM interprets Class Headings as per the Court’s

decision, i.e. a literal approach

IP TRANSLATOR cont.

♦ Inconsistency!♦ OHIM website refers to No. 2/12 as “ a temporary

solution”

♦ Potential problems for trade mark owners:♦ uncertainty♦ await another test case

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IP TRANSLATOR cont.

♦ What to do?

♦ “Tick box” for whole alphabetical list of Class but no bespoking?♦ Problem: e.g. Class 35 alphabetical list does not

include “retail services”♦ Bespoke is better – add full alphabetical list after

bespoke list if needed

ONEL / OMEL

Leno Merken BV – Hagelkruis Beheer BV Case C-149/11

• Registered trade marks are subject to “use” requirements (and can be revoked for non-use) 5 years after registration

• CTM must be put to “genuine use within the Community”

• “use in the Community”- how many countries is “the Community”?

5

ONEL / OMEL cont.

Leno Merken BV – Hagelkruis Beheer BV Case C-149/11

• CJEU

• National borders are ignored

• Look at market for goods

• Had TM been used to maintain or create market share within that market?

BEER OR TEQUILA

Mustafa Yilmaz v OYM – TEQUILA CUERVO Case T-584/10

• Many trade mark disputes turn on whether product A is similar toproduct B

• Generally look at

• nature of goods/services

• intended purpose

• method of use

• whether they are competing or complementary

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BEER OR TEQUILA cont.

Mustafa Yilmaz v OYM – TEQUILA CUERVO Case T-584/10

• Examples

• wine / wine glasses – NOT similar

• perfumes / clothing - NOT similar

• Wine / Beer – NOT similar

• Now Beer v Tequila – no similarity!

BIMBO DOUGHNUTS

Bimbo SA v OHIM Case T-569/10

• 2006 Bimbo filed CTM Application for BIMBO DOUGHNUTS in Class 30

• Panrico opposed based on, among others, Spanish word mark DOGHNUTS registered in Class 30

• 2009 the Opposition Division allowed the opposition

• Decision confirmed by the Fourth Board of Appeal

• General Court

• … since the earlier trade mark was a Spanish mark, "likelihood of confusion" had to be assessed by reference to the Spanish public.

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NO EURO DEFENCE

Oracle America Inc v M-Tech Data Ltd [2012] UNSC 27

• Can relying on legitimate trade mark rights to prevent re-sale of genuine goods be unlawfully anti-competitive?

• Frequent friction between

• (a) monopolistic trade mark rights; and

• (b) free competition

• Cannot use so called “Euro defence” to escape liability for trade mark infringement.

EU EXIT & TRADE MARKS

♦ What if the UK votes to leave the EU in 2018?

♦ Many “good”, well functioning UK laws, are interwoven with EU law

♦ CTM – EU Regulation

♦ CTM - Useful and widely adopted

8

EU EXIT & TRADE MARKS cont.

♦ Could we “contract” in to CTM?

♦ How do we deal with General Court / CJEU decisions and references?

♦ What about the many businesses with CTMs and no national rights?

♦ How would High Court be a “CTM Court”?



Trade Marks – European Perspective

Nick BolterPartner-in-Charge, London

31 January 2013

1



Pick a Court…any Court!

Akash SachdevaPartner, London

31 January 2013

Forum issues in Patent Litigation in Europe

♦ Two decisions on Pan-European relief:

♦ Actavis v Eli Lilly - [2012] EWHC♦ Solvay SA v Honeywell – C-616/10

2

Some important background

♦ Council Regulation 44/2001/EC (22 December 2000) - the “Brussels I Regulation”♦ Art. 2 – D should be sued in territory where D is domiciled♦ Art. 5(3) – in case of tort, D can be sued in territory where harmful event occurred♦ Art. 6(1) – where D is one of a number of Ds, D can be sued in territory where any one

of the Ds is domiciled (provided claims against Ds sufficiently closely connected)♦ Art. 22(4) – in actions relating to the validity of any patent (or other IP) registrations, the

courts for the territory in which register is maintained have EXCLUSIVE jurisdiction♦ Art. 27 – where claims in different Member States involve the same cause of action and

same parties, all proceedings save in Court first seised must be stayed until Court first seised has established jurisdiction, whereupon the other courts must decline jurisdiction

♦ Art. 28 – where related actions are pending in different Member States, any Court other than Court first seised MAY stay or decline jurisdiction.

The Brussels Regulation vs European Patent law

“Unfortunately neither document [the Brussels Regulation and its predecessor] fully considered the problems posed by intellectual property rights. This is because at present such rights are national rather than EU rights. They are not only limited territorially, but exist in parallel”Jacob LJ – RIM v Visto [2008] FSR 20

♦ Nature of patent claims lend themselves to forum shopping:♦ range of potential defendants mean a wide choice of domiciles

from which to choose♦ DNI claims♦ exclusive jurisdiction relating to validity of patents vs. invalidity

as a defence to infringement♦ Italian (or Belgian) torpedos

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What does it matter?

♦ Forum shopping a direct result of differences in how each MemberStates deal with patent litigation matters: ♦ Speed

♦ patentee wants swift action; defendant less so♦ Cost

♦ some jurisdictions are more expensive♦ cost recovery from losing side not available everywhere

♦ Procedure♦ cross examination♦ disclosure♦ expert evidence

♦ Judicial expertise♦ some judges are more technically able

♦ Reputation as pro or anti patentee♦ e.g. England v Germany

♦ Bifurcation

RIM v Visto

♦ RIM commenced DNI and revocation claim against Visto EP(UK) ‘905 in England

♦ Then commenced revocation claim against EP(IT) ‘905 in Italy AND DNI against EP (various EP designations save UK) ‘905 in Italy (“Italian Torpedo”)

♦ Visto counterclaimed in England for abuse of process of Italian law (Art. 96 of Italian procedural code).

♦ Court of Appeal (Jacob LJ):♦ “The case is yet another illustrating the unsatisfactory state of

the current arrangements for deciding European wide patent disputes. Too often one finds parties litigating as much about where and when disputes should be heard as about the real underlying dispute”

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A new chapter?

♦ Actavis v Lilly – 27 November 2012 – Arnold J♦ Facts

♦ Lilly – a US based Co. – owned EP ‘508 including German, Italian, Spanish, French and UK designations

♦ Actavis applied in the UK for DNI (i) in relation the UK designation and (ii) in relation to German, Spanish, Italian andFrench designations

♦ prior to claim being issued, Lilly’s UK solicitors indicated they were instructed to “accept service on behalf of our client”

♦ after Claim was issued, Lilly claimed service of claim (ii) was not consented to and applied to contest the English Court’s jurisdiction re claim (ii)

English Court takes on mainland Europe

♦ Arnold J held: ♦ Service was properly made and Lilly’s solicitors, by accepting

service, also consented to the English Court’s jurisdiction to hear the claims

♦ Even if conclusion on service was wrong, no stay should be granted on the basis of forum non conveniens: ♦ following the Lucasfilm v Ainsworth decision there was – essentially – no

limit to subject matter jurisdiction♦ when validity was not in issue (cf Brussels Regulation), no reason why

patent infringement claims treated differently to copyright♦ more importantly the evidence did not show that either the German, Italian,

French or Spanish Courts were more appropriate fora to determine DNI claims in respect of their respective designations of EP ‘508

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Implications

♦ English Court has announced a greater flexibility which may saveparties significant time, money and effort in any pan-European patent litigation

♦ Defendants are able to get clarity in a number of significant jurisdictions in an efficient way

♦ Politically, while the single European Patent Court is advancing –to much criticism – this positions the English Court as being at the forefront of Pan-European patent litigation offering the right blend of efficiency and expertise

♦ Contrast Italian decision in Windmoeller in which Italian court said it did not have jurisdiction under 5(3) Brussels Regulation to hear DNI claims for non-Italian designations of EPs

Claimants have a new weapon too…

♦ Solvay v Honeywell – CJEU 12 July 2012♦ Facts:

♦ S sued H companies based in Holland and Belgium in the Hague for patent infringement of several national designations of an EP patent based on the same product in the designated countries. H put validity of EP in issue in defence

♦ S then sought a provisional interim injunction against the H defendants

♦ Dutch court referred questions to CJEU♦ How was the issue of irreconcilable judgments under Art.

6(1) BR to be considered?♦ Did Art. 22(4) BR apply to provisional measures?

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CJEU resurrects Pan-European injunctions

♦ The Court held for Art 6(1) it is for national courts to determine risk of irreconcilable judgments but made it clear that

“it is not sufficient that there be a divergence in the outcome of the dispute, but that divergence must also arise in the same situation of fact and law”

♦ On the provisional injunction point, CJEU pointed to Art. 31 of BR which states: “Application may be made to the courts of a Member State for such provisional…measures as may be available…even if, under this Regulation, the courts of another Member State have jurisdiction”

♦ Concluded: Art.22(4) does not preclude an interim injunction being granted for infringement of a foreign patent, even where the validity of that patent has been put in issue

Implications

♦ The combination of the decision relating to Art 6(1) and 22(4) of BR means that it is now possible for patent owners to:

♦ sue multiple Ds (including foreign Ds) for infringement of designations of European Patents in one Member State; and

♦ obtain interim relief against those Ds and foreign Ds that has across-border effect even where validity has been put in issue

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Questions?

♦ But first, a question for you:

In light of the organic development of European Patent jurisprudence, is the single European Patent Court necessary?



Pick a Court…any Court!

Akash SachdevaPartner, London

31 January 2013

1



Technology Wars: Recent Battles on the Competition Law Front

Trupti ReddyAssociate, London

31 January 2013

Outline

♦ Competition law and IP, or competition law v IP?

♦ Abuse of IPRs in the telecoms sector

♦ Unilateral conduct

♦ Google/Motorola Mobility; Samsung

♦ Patent settlements and pay to delay agreements in the pharma sector

♦ Anticompetitive agreements

♦ Lundbeck; Servier

2

Legal principles

♦ Article 101 TFEU:

♦ Anti-competitive agreements and practices

♦ Exemptions: block exemptions or individual self-assessment

♦ Infringing agreements are void and unenforceable

♦ Article 102 TFEU: abuse of a dominant market position

♦ Dominance means the “ability to behave to an appreciable extent independently of competitors and customers”

♦ Tension between competition law and IP?

♦ Commission Guidelines on Horizontal Cooperation Agreements, para 269: “Intellectual property laws and competition laws share the same objectives of promoting innovation and enhancing consumer welfare”

♦ Holding an IPR is not an infringement of competition law

♦ Exercising rights conferred by or related to IPRs may infringe competition law


Telecoms and patent hold up

3

Background: SSOs, SEPs and FRAND

♦ Significant technological developments, and pro-competitive benefits in telecoms facilitated by SSOs and standards

♦ Patents incorporated into standards become essential (SEPs)

♦ Each SEP confers market power and opens risk of abuse accusation

♦ Seeking/threatening injunctions against willing FRAND licensees may constitute abuse

♦ Many SSOs require FRAND commitments

♦ Incorporation of a patent into a standard induces market reliance on that patent and increases its value – “lock in”

♦ But what is FRAND?

♦ EC (and FTC) unwilling to define FRAND

♦ Courts must decide

Google/Motorola Mobility merger decision

♦ MMI has extensive patent portfolio; no competition concerns except in relation to SEPs

♦ EC considered whether Google could significantly impede competition post-merger

♦ Google pledged to continue to license on FRAND terms, at existing rates (subject to reciprocity by the counter-party)

♦ EC decision

♦ Cleared unconditionally (February 2012)

♦ FRAND commitment alone will not guarantee that an SEP holder will not abuse its market power

♦ Access to injunctive relief a significant competitive constraint on Google/MMI

♦ Use of SEPs could raise competition problems, but such problems did not arise as a result of the transaction

4

Injunctive relief: MMI and Samsung investigations

Article 102

Failure to honour FRAND commitment by seeking & enforcing injunctions against willing licensees

Offering unfair licensing conditions for SEPs to willing licensees

Seeking injunctions against willing licensees

SO issued December 2012

Recognised right of SEP holder to seek injunctions

Fundamental right of access to court

Meanwhile, in the US…

♦ FTC settlement

♦ FTC investigated same MMI practices as EC

♦ Google prevented from seeking an injunction for patent infringement against someone willing to pay for a licence to an SEP on FRAND terms

♦ Willing licensees: limited circumstances in which a licensee will be deemed “unwilling”

♦ Dissenting judgment

♦ Courts better suited to defining use and treatment of SEPs

♦ Ambiguity re what constitutes FRAND

♦ Protecting competitors rather than consumers?

♦ Blueprint for settlement of European cases?

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Pharma: patent settlements and pay to delay agreements

Preventing and delaying generics

♦ EC pharma sector inquiry completed in 2009

♦ Already indicated potential for patenting strategies to distort competition

♦ Competition concerns

♦ Agreements preventing, restricting or distorting competition

♦ Delaying entry of generics = maintaining high prices

♦ Emphasis on cost to consumers

♦ Potential abuse of a dominant position

♦ Unintended negative consequences of competition enforcement?

♦ Decrease in reward to innovation

♦ Original innovator profits maintained by increasing prices for patented product. Best result for consumers?

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Current EC investigations

♦ Perindopril: SO sent to Servier and generics

♦ Strategies aimed at delaying/preventing generic entry

♦ Inducing patent settlements also potential abuse of dominant position

♦ UK follow-on private action already lodged

♦ Citalopram: SO sent to Lundbeck and generics

♦ Preventing entry of competing generic drugs through direct payments and purchases of generic citalopram for destruction

♦ May have delayed entry of generics for up to two years - prices remained high

♦ Cases opened in 2011 against Johnson & Johnson, Novartis, Cephalon and Teva – no SO yet

♦ Cases closed against AstraZeneca, Nycomed and GSK in 2012, with no action taken

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The US view

♦ FTC staff report (January 2013)

♦ 40 agreements in 2012, covering 31 different products, with combined sales value of $8.3 billion, “cost[ing] Americans $3.5 billion annually”

♦ FTC has challenged a number of patent settlements

♦ FTC v Watson Pharmaceuticals, Inc: Supreme Court ruling expected in 2013

♦ Are pay to delay settlements within the “scope of the patent” (per se lawful), or should there be a rebuttable presumption they are anticompetitive?

12

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What to expect in 2013?

Can we expect guidance from EC decisions?

♦ Seeking/enforcing injunctive relief as an abuse of dominance

♦ Will remain a recognised part of an IPR

♦ EC may clarify when the exercise of the right infringes Article 102

♦ EC to follow FTC Google/MMI settlement?

♦ Patent settlements/pay to delay agreements in pharma

♦ EC decisions may not be handed down this year

♦ US Supreme Court ruling expected in 2013 – some clarity?

♦ Competition law continuing to “fix” IP problems

♦ Fixing a problem in the process?

♦ Or restricting the exercise of an IPR?

♦ Protecting consumers or competitors?

14

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Technology Wars: Recent Battles on the Competition Law Front

Trupti ReddyAssociate, London

31 January 2013

1



The Social Media Revolution:What did we learn from 2012?

Richard GrahamPartner, London

31 January 2013

Social Media: Introduction

♦ Defining ‘Social Media’♦ Defining the ‘Legal Issues’♦ What did Social Media teach us in 2012?

♦ 1. We need to understand intellectual property law♦ 2. We need to understand contract law♦ 3. We need to understand data protection and privacy law♦ 4. We need to understand employment law♦ 5. We need to understand freedom of speech♦ 6. We need to understand e-commerce law♦ 7. We need to understand the wider regulatory environment♦ 8. We all need a bit more common sense.......

♦ What should we do now?

2

Social Media: Defining ‘Social Media’

The SocialMedia

Revolution

♦ Defining ‘Social Media’

Article 29 Working Party Opinion 5/2009 on online social networking:

‘... online communication platforms which enable individuals to join or create networks of like-minded users ...’

Social Media: Defining the legal issues

♦ Defining the ‘Legal Issues’

IPR

Contract Law

Data Protection

and Privacy

EmploymentLaw &

Confidentiality

SecondaryLiability

Defamation &Freedom of

Speech

Advertising &Promotions

Other

The SocialMedia

Revolution

‘...implied licenceor infringement...’

‘..fair or unfair contract term...’

‘..opt-in or opt-out consent...’

‘..private or professional...’

‘..safe harbour or liable...’

‘..right to privacy or freedom of speech...’

‘..prize competition or unlawful game...’ ‘..share tip or

insider trading...’

3

What did Social Media teach us in 2012?

♦ Lesson 1: We need to understand intellectual property

♦ Originality? Authorship? Jurisdiction? Infringement?♦ What are the terms governing intellectual property?♦ Are there any overriding legal sources of law?♦ How is the contract agreed?♦ Is it enforceable?♦ What types of infringement are relevant?

♦ Copyright, database right and user generated content♦ Trade mark (content / username) and coexistence♦ Counterfeits♦ Linking, Retweeting & Meltwater♦ Tools to report copyright infringement♦ Tools to report trademark infringement



‘You agree that a business or other entity may pay us to display your username, likeness, photos (along with any associated metadata), and/or actions you take, in connection with paid or sponsored content or promotions, without any compensation to you.’

4



♦ Ownership of ‘friends’ & ‘followers’ is a hot topic♦ Hays v Ions ♦ Phonedog.com v Noah Kravitz♦ @BBCLauraK v @ITVLauraK


♦ Lesson 2: We need to understand contract law

Legally Binding Contract(s)?•Offer, Acceptance, Intention & Consideration•Incorporation of Terms and Conditions•Shrink-Wrap, Click-Wrap, Web-Wrap•Form and Language

Terms of Use / Sale

Privacy Policy

AcceptableUse

Policy

AppPolicy

Promotions Policy

APIPolicy

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♦ Lesson 2: We need to understand contract law

Fairness

Plain Language

Two Step Test

Contrary to the requirement of good faith it causes a significant imbalance in the parties' rights and obligations under the contract,

to the detriment of consumers.

Contrary to the requirement of good faith it causes a significant imbalance in the parties' rights and obligations under the contract,

to the detriment of consumers.

'Good faith' means that you must deal fairly and openly with consumers. Standard terms may be drafted to protect commercial

needs but must also take account of the interests and rights of consumers by going no further than is necessary to protect those

legitimate commercial interests.

'Good faith' means that you must deal fairly and openly with consumers. Standard terms may be drafted to protect commercial

needs but must also take account of the interests and rights of consumers by going no further than is necessary to protect those

legitimate commercial interests.

A standard term must be expressed in plain and intelligible language. A term is open to challenge if it could put the consumer

at a disadvantage because he or she is not clear about its meaning - even if its meaning could be worked out by a lawyer. If

there is doubt as to what a term means, the meaning most favourable to the consumer will apply.

A standard term must be expressed in plain and intelligible language. A term is open to challenge if it could put the consumer

at a disadvantage because he or she is not clear about its meaning - even if its meaning could be worked out by a lawyer. If

there is doubt as to what a term means, the meaning most favourable to the consumer will apply.


♦ Lesson 3: We need to understand data protection and privacy

♦ What questions do we need to ask?♦ Who is the ‘data controller’?♦ What are the security and default privacy settings?♦ What information should the social media platform provide?♦ What about sensitive data?♦ What about the processing of data of non-members?♦ What about third party access?♦ What are the legal grounds for direct marketing?♦ What are the data retention requirements?♦ What are the rights of the end users?

6


♦ Lesson 4: We need to understand employment law

♦ The private v professional debate♦ IPR created ‘in the course of employment.....’♦ The limits to unfair dismissal♦ Smith v Trafford Housing Trust [2012] Facebook post;

Personal opinion about gay rights; No breach of Equal Opportunities Policy

♦ Once again, the ownership of ‘friends’ and ‘contacts’ is a big problem

♦ Confidentiality law will play a big part in regulating social media in the employment context


♦ Lesson 5: We need to understand freedom of speech

......but we also need to understand defamation, anonymity,harassment, Twitter ‘jokes’, Communications Act 2003,

Internet trolls, Contempt of Court

7


♦ Lesson 6: We need to understand e-commerce

♦ Liability for illegal content on social media platforms is a problem

♦ Conflicting aims:♦ Freedom / net neutrality of providers♦ Protection of third party rights

♦ Safe Harbour in the E-Commerce Directive (2001/31)♦ The prohibition of the general monitoring obligation♦ Note: Businesses using social media do not benefit from

Safe Harbor


♦ Lesson 7: We need to understand the wider regulatory environment

♦ Financial Services Regulation♦ Law Society Regulations♦ Commercial use of Social Media

♦ Unfair Commercial Practices (e.g. aggressive practices)♦ Office of Fair Trading / Advertising Standards Authority♦ The Facebook ‘Sponsored Stories’ in the US♦ Prize Competitions and Gambling

8


♦ Lesson 8: We all need to have more common sense

.....but sometimes it works....#WaitroseReasons

16

Assess theInformation &Risk

Develop Acceptable Use

Align to Marketing Strategy

DevelopProcedures Implement

Review and Repeat

Implement a Social Media Policy and Strategy

♦ Personal/Professional

♦ Behavioural Standards

♦ Confidentiality

♦ Existing Use♦ IPR♦ Data Protection

♦ Social Media Policy

♦ Employee Handbook

♦ Security and Devices

♦ Social Media Access Control

♦ Sign-off Framework

♦ Ownership of Accounts

♦ Legal Disclaimers

♦ Advertising/Promotions

♦ Brand Guidelines

What should we do now?

9



The Social Media Revolution:What did we learn from 2012?

Richard GrahamPartner, London

31 January 2013

1



Double Trouble: IP problems in IT disputes

Geoff MendelsohnPartner, London

31 January 2013

Background to the dispute

♦ A were C’s sub-contractors in relation to the provision of data migration services to a customer

♦ C terminated the contract with A in June 2011. It was agreed that the contract was terminated and no challenge was made by A to the termination at that time

♦ In November 2011 A wrote to C alleging that C had infringed A’s IP in its data migration solution

Customer Main Contractor (C) Sub-contractor (A)

End usersdata migration tool

2

IP issues

♦ A alleged that C had copied the source code in A’s data migration tool, enabling C to create its own in-house data migration tool very quickly following termination of the contract

♦ A’s claim was based on the allegation that C had access to and had copied the source code in the data migration tool

♦ A claimed breach of contract, copyright infringement and unlawful misuse of confidential information

Copying of source code?

♦ “Contractor Tools means software, templates, techniques, methodologies, procedures, innovations, rules, documentation, specifications or know-how not specifically developed to a design and specification of C or the Customer in connection with this Agreement, together with any improvement, extension, modification or corrected version of the foregoing, whether created in connection with this Agreement or not, from time to time issued or implemented by or on behalf of A.”

♦ “Equipment means any equipment, software or hardware supplied by one Party to the other on a temporary basis for the duration of the Services or part thereof.”

♦ “Intellectual Property Rights or IPR means rights, title and interest in inventions (whether patentable or not, and whether or not patent protection has been applied for or granted), improvements, developments, discoveries, patents, utility models, petty patents, confidential information, trade secrets, trade marks, logos, processes, registered designs, design rights and all other designs (whether registrable or not), mask work rights, semi-conductor topography rights, rights in databases, moral rights, copyright (including copyright in programs) and all other rights or forms of protection (whether or not registrable and including applications for registration) of a similar nature or having a broadly equivalent effect anywhere in the world.”

3


♦ “18.7 Both parties agree to use any Equipment supplied by the other party and all Intellectual Property Rights or software, proprietary to either party, solely for the purposes of this Agreement and, in particular, shall not itself or through any subsidiary, agent or third party copy, adapt, reverse engineer, decompile, disassemble, redistribute, modify, vary, enhance sell, lease, license, sub-licence or otherwise deal with the Equipment or any information provided by either party or any parts, variations, modifications, copies, releases, versions or enhancements thereof nor shall either party have any software written or developed for itself based on any Confidential Information of the other party or the other parties contractors or clients.”

♦ “18.9 For the avoidance of doubt, it is agreed that the intellectual property rights and all other rights in the Contractor Tools used in the delivery of the Services shall remain vested in A.”


♦ “….if the group of records overlap in time (based on FromDate and ToDate) or have a gap of less than 24 hours, the record with the most recent ToDate is kept, and the FromDate is set to be the earliest FromDate within the group duplicate records.”

♦ A classified the terms as “source code” and therefore an example of its IPR.

♦ Firstly, A had no proprietary IP rights in such rules because they are necessary for data migration and were not unique to A.

♦ Secondly, C had never had access to the source code of A’s data migration tool and no copying of the source code could have taken place.

♦ In fact it was simply an example of a rule required to be inputted into the data migration tool to enable the data migration to take place, e.g. use of the terms ‘FromDate’ and ‘ToDate’.

4

Outcome of dispute

♦ A dropped the claim for breach of contract, copyright infringement or misuse of confidential information

♦ If planning to terminate agreement for example, to bring the service back in house, consider the IP clauses to make sure yourstrategy takes account of who might own what under a partially performed contract.



Double Trouble: IP problems in IT disputes

Geoff MendelsohnPartner, London

31 January 2013

1



Unlucky for some: Will 2013 Break the Internet?

Gareth DicksonAssociate, London

31 January 2013

Introduction

♦ What makes an efficient Internet?

♦ Technological change vs. legal change

♦ Key legal provisions

♦ What is the likely practical impact of adverse rulings?

♦ Proposals for reform in 2013

♦ Conclusions

2

What makes an efficient Internet?

♦ Convenience and predictability:

♦ Search results

♦ Links

♦ Worldwide accessibility

♦ Lossless reproduction

Technological change vs. legal change

Speed / competitive advantageLess competitive pressure

Limited accountabilityAccountability

There is no boxDesign within the box

DecentralisedCentralised

To make life betterTo make life better

For the thrill of doing itObligation to do it

Technological changeLegal change

3

Key legal provisions

♦ Section 16 Copyright, Designs and Patents Act 1988 provides for various exclusive rights in respect of original literary works:

♦ to copy the work;♦ to issue copies of the work to the public;♦ to rent or lend the work to the public;♦ to perform, show or play the work in public;♦ to communicate the work to the public;♦ to make an adaptation of the work or do any of the above in

relation to an adaptation.

Key legal provisions

♦ Section 16 Copyright, Designs and Patents Act 1988 provides for various exclusive rights in respect of original literary works:

♦ to copy the work;♦ to issue copies of the work to the public;♦ to rent or lend the work to the public;♦ to perform, show or play the work in public;♦ to communicate the work to the public;♦ to make an adaptation of the work or do any of the above in

relation to an adaptation.

4

Search results (1)

♦ Results in response to a user’s request:♦ Headlines and titles♦ Snippets♦ Links to original work

♦ Leading CJEU case is Case C-5/08 Infopaq (2009)♦ Broad protection; strict interpretation of any derogations♦ “Original” means author’s own intellectual creation♦ Parts of a work which “contain elements which are the

expression of the intellectual creation of the author of the work”are also protected

♦ Reproduction right cannot be subject to acts “dependent on human intervention” – national court to decide

Search results (2)

♦ NLA v. Meltwater (High Court 2010; Court of Appeal 2011)

♦ News alerts services:♦ reproduce protected works and parts of works;♦ involve the issue of copies to the public.

♦ Prima facie, viewing a webpage and receiving an email are infringing unless consent or a defence applies

♦ Judges rejected all applicable defences, including temporary copies exception found in s.28A CDPA

5

Search results (3)

Section 28A CDPA 1988

♦ Copyright in a literary work, other than a computer program or adatabase …is not infringed by the making of a temporary copy which is transient or incidental, which is an integral and essential part of a technological process and the sole purpose of which is to enable—

(a) a transmission of the work in a network between third parties by an intermediary; or

(b) a lawful use of the work;

and which has no independent economic significance.

Search results (3)

Section 28A CDPA 1988

♦ Copyright in a literary work, other than a computer program or adatabase …is not infringed by the making of a temporary copywhich is transient or incidental, which is an integral and essential part of a technological process and the sole purpose of which is to enable—

(a) a transmission of the work in a network between third parties by an intermediary; or

(b) a lawful use of the work;

and which has no independent economic significance.

6

Search results (4)

♦ Infopaq (2009) held copies enabling caching are “by definition, created and deleted automatically and without human intervention”, and are excepted

♦ Meltwater (2010 and 2011) held caching on personal computers is a consumption of the work, and therefore not excepted

BUT:

♦ Case C-128/11 UsedSoft v. Oracle (2012) creates a brand new reproduction right that is entirely dependent on human intervention

♦ Meltwater (Supreme Court 2013) appeals this issue alone

Links (1)

♦ Permalinks vs. vanity URLs – a link could be infringing in and of itself, following Infopaq and Meltwater, but will be rare.

♦ Newspaper Licensing Ireland: “a licence is required to link directly to an online article even without uploading any of the content directly onto your own website”

♦ National Newspapers of Ireland: “our view of existing legislation is that the display and transmission of links does constitute an infringement of copyright”

♦ Haven’t we seen this before?

7

Links (2)

♦ Case C-466/12 Svensson:

♦ Are links a communication to the public of the target work?♦ Does it make a difference whether the target page is framed?♦ Can Member States broaden a rightsholders’ exclusive right to

communicate protected works to the public?

Worldwide accessibility (1)

♦ Will there be a need to restrict the display of content to the jurisdiction from which it is submitted?

♦ Personality / privacy rights:♦ Cases C-509/09 and Case C-161/10 eDate (2011): Where

content provider is established; where claimant has centre of interests; or where content is accessible

♦ Trade marks:♦ Case C-523/10 Wintersteiger (2012): Where the mark is

protected or where the advertiser is established

8


♦ Copyright / database (communication to the public):

♦ Case C-5/11 Titus Alexander Jochen Donner (2012):♦ “Making available to the public” is “characterised by a series

of acts” from, at least, conclusion of a contract of sale to the performance thereof by delivery to a member of the public

♦ Distribution may take place, and therefore be actionable, in a number of Member States

♦ Case C-173/11 Sportradar (2012): A “making available” occurs at least where the recipient of data is located, provided that he has been targeted


♦ Cases to watch this year:

♦ Case C-466/12 Svensson: are links communications to the public of the target work?

♦ Case C-607/11 ITV Broadcasting v TV Catch Up: are Internet streams of broadcast TV communications to the public?

♦ WNET v. Aereo (Cases 12-12786-cv and 12-2807-cv) and Fox Television v. Aereokiller (Cases CV-12-6921 and CV-12-6950): US cases similar to TV Catch Up, but at a more advanced stage of litigation

9

Lossless reproduction

♦ Lossless copying:♦ is critical to social media♦ enables the rapid, reliable exchanges of content and ideas♦ makes endless format shifting (and piracy) viable

♦ Do rightsholders need a quid pro quo for ISPs’ safe harbours?

♦ Secondary markets for digital media?♦ UsedSoft – permits the resale of downloaded computer

programs in certain circumstances; endorses DRM but makes anti-piracy campaigns more difficult

♦ ReDigi – launch in Europe anticipates that the resale of other downloaded materials is permitted, absent contractual terms

What are the likely practical impacts of adverse rulings?

♦ Vast majority of private Internet users will abide by the rule of law most of the time. However:♦ Social media♦ Private copying♦ Format shifting♦ DRM-circumvention

♦ What about commercial users?♦ NLI and NNI♦ The situation in Belgium♦ Discernable change since Infopaq and Meltwater?

10

Are we focused on the right question?

Will 2013 break the Internet?

Are we focused on the right question?

Will 2013 “fix” copyright?

11

Proposals for legislative reform in 2013

♦ Gowers Review of Intellectual Property, 2006

♦ DIGITAL OPPORTUNITY A Review of Intellectual Property and Growth (Hargreaves Review, 2011)

♦ Government proposals (2012-2013)♦ Private copying♦ Parody, caricature and pastiche♦ Data analytics♦ Freedom to contract?

Conclusions

♦ Trends in recent jurisprudence

♦ What would be the likely practical impact of adverse rulings?♦ Search♦ Links♦ Worldwide accessibility♦ Lossless reproduction

♦ Proposals for reform in 2013

♦ The next 11 months will not break the Internet, but they might amend copyright for the sake of consistency

12

Unlucky for some: Will 2013 break the Internet?

Thank YouGareth Dickson

England and Wales, New York

[email protected]

+44 (0)207 556 4470



Unlucky for some: Will 2013 Break the Internet?

Gareth DicksonAssociate, London

31 January 2013


Speakers’ Biographies

Akash Sachdeva joined Edwards Wildman in 2011 as a Partner. He is a qualified barrister, having trained in the IP specialist Chambers of Christopher Floyd QC. He has over 13 years of experience in intellectual property litigation including acting for Research In Motion on patent litigation matters in the English High Court, acting for BSkyB in a case involving the importation of foreign decoder cards, acting for a major defense contractor in an arbitration involving confidential information and acting for a major Chinese telecoms company in proceedings in Hong Kong and China.

He also has had significant experience in international arbitration having acted in ICC, AAA and LCIA arbitration disputes.

Akash Sachdeva (Chair)Partner, Intellectual Property GroupEdwards Wildman Palmer UK LLPe: [email protected]


Guest Speaker

Edwards Wildman Speakers

Christian is Legal Counsel at Williams. Christian spent six years working in private practice in London, before making the move in-house a year ago. Prior to his current role, Christian was an Associate in the Intellectual Property department of Allen & Overy’s London office.

Christian provides legal support to the whole of the Williams group, including its F1 and non-F1 (commercialisation) activities. He has primary responsibility for all IP matters across the business.

Christian is married and has a young daughter. In his spare time, Christian enjoys cricket, squash and other people’s baking.

Christian BedfordLegal Counsel, Williams F1

Ben has over 20 years experience in advising companies on the strategic management, commercialisation and protection of their valuable intellectual property. He specialises in high technology, and has worked with clients in a number of industries, including bio-pharma, ICT, food and drink, energy, and university technology transfer. He has advised many different types of client, including multinational corporations, SMEs, lenders, and academic institutions on issues relating to the commercialisation and licensing of IP. Ben spent two years in Shanghai, where he managed his previous firm’s China business and Asia commercial IP groups, and has internationally-recognised expertise in advising on strategies for the protection, commercialisation and management of IP assets in China and Asia.

Ben is widely recognised as a leading IP practitioner. Intellectual Asset Management magazine listed him in its IAM Licensing 250: The World’s Leading Patent and Technology Licensing Practitioners in 2010 and its IAM Strategy 250 – The World’s Leading IP Strategists in 2009, 2010 and 2011. He is ranked in the UK guide for Chambers, and Legal Business cited him as an expert in IP and IT in its “Legal Experts 2010.”

Ben GoodgerPartner, Intellectual Property GroupEdwards Wildman Palmer UK LLPe: [email protected]

Nick is the Partner-In-Charge at the firm’s London office and a partner in the firm’s International Trade Mark & Copyright Protection Group.

Nick has experience in all areas of intellectual property with a particular focus on trade marks and designs. Nick advises clients on all aspects of the selection, prosecution, protection and enforcement of trade marks, brands and designs.

Nicholas BolterPartner-In-Charge, Intellectual Property GroupEdwards Wildman Palmer UK LLPe: [email protected]

Richard is a partner in the firm’s London office, where he specialises in technology, media and telecommunications (TMT) matters and strategic outsourcing transactions. Richard is a member of the firm’s Privacy & Data Protection Group Steering Committee. He is actively involved in a wide variety of industry sectors, including the TMT, broadcasting, healthcare, financial services and insurance sectors.

Richard’s practice includes providing commercial and regulatory support in connection with IT, communications, media, e-commerce, broadcasting and gambling projects. He also regularly advises clients in connection with privacy, data protection and information security matters.

Richard GrahamPartner, IT/IP Litigation GroupEdwards Wildman Palmer LLPe: [email protected]

Geoff joined Edwards Wildman in 2012 and is a specialist litigator highly experienced in major IT disputes. Geoff partners with clients to understand their business better and to help them achieve their commercial objectives. This can involve risk evaluation and managing problem contracts behind the scenes or settling disputes to avoid proceedings and to preserve working relationships. Geoff has particular experience in dispute resolution procedures, including mediation, early neutral evaluation and arbitration.

Sometimes proceedings cannot be avoided. Geoff led the team in what Computer Weekly called, at the time, one of the longest running IT trials in the Technology and Construction Court against National Air Traffic Services Ltd. He continues to lead on significant disputes for large international IT companies. He and his team are currently advising a provider under the £12bn NHS National Programme for IT. Chambers notes that “Geoff Mendelsohn impresses clients with his ability to deal with difficult cases in a calm and competent way” and he appeared in the Legal 500 as “a genuine contentious heavyweight as demonstrated by his representation on high value disputes”.

Geoff MendelsohnPartner, IT/IP Litigation GroupEdwards Wildman Palmer LLPe: [email protected]

Gareth is a litigator in the Litigation practice in Edwards Wildman’s London office. He is a UK qualified solicitor and New York admitted attorney whose practice focuses on the resolution of technology and intellectual property disputes. Gareth is regularly called upon by clients to urgently resolve cross-border disputes involving the technology, financial services, luxury goods and creative industries.

Gareth DicksonAssociate IT/IP Litigation GroupEdwards Wildman Palmer LLPe: [email protected]

Trupti is an associate in Edwards Wildman’s Antitrust/Competition group, advising on all aspects of EU and UK competition law.

She has advised large multi-national companies and private equity funds on merger filings in the EU, UK and worldwide and on matters relating to Article 101 and 102 of the Treaty on the Functioning of the European Union. She also regularly advises on competition issues arising from distribution and agency agreements.

She has experience across a range of sectors, including financial services, energy and manufacturing. She also has experience with the Chinese competition regime, having spent time in Beijing with a previous firm.

Trupti ReddyAssociate, Antitrust and Competition GroupEdwards Wildman Palmer UK LLPe: [email protected]

Dashwood 69 Old Broad StreetLondon EC2M 1QS, UKtel: +44 (0)20 7583 4055 fax: +44 (0)20 7353 7377

edwardswildman.comIPInteraction.com

©2013 Edwards Wildman Palmer LLP and Edwards Wildman Palmer UK LLP ATTORNEY ADVERTISING: Prior results do not guarantee a similar outcome

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