Intellectual Property and IT
- Trademark and Passing Off
- Patent and Design Right Infringement
- Copyright Infringement
- Domain Name Disputes
- Parallel Importation
- Comparative Advertising
- Trade Libel and Malicious Falsehood
- Misuse of Confidential Information (Including Know How, Trade Secrets and Breach of Non-Disclosure Agreements)
- Recent Cases and Testimonials
What is a trade mark?
A trademark is a recognisable sign which identifies your goods or services and distinguishes them from competitors. It is possible to register trademarks, which gives you right of exclusive use of the trademark. You can therefore make a claim against anyone who uses the trademark without your permission. This may be when another party uses your trademark for their own goods or services, or when another party uses a mark which is confusingly similar to your own.
Trade mark infringement
There are various circumstances in the Trade Marks Act 1994 under which someone will be liable for trade mark infringement. These are when the infringer:
- Uses an identical sign and identical goods.
- Uses an identical sign, similar goods and there is a likelihood of confusion.
- Uses a similar sign, identical or similar goods and there is a likelihood of confusion.
- Uses an identical or similar sign, the sign has a reputation in the UK and the use of the sign takes unfair advantage of or is detrimental to the character of reputation of the trade mark.
For a claim to be successful the trade mark must have been used without the permission of the proprietor. The use must also be in the course of trade. This means that it must be used in a commercial context and not just for a private matter.
If a claim for trade mark infringement is successful, the claimant may seek the following remedies:
- This would prevent the defendant from using the trade mark without permission in the future.
- Order for delivery up and disposal of the goods complained of.
Our specialist Trade Mark Infringement Solicitors will be able to advise as to the best steps to take to protect your business’ Trade Mark and where necessary can seek injunctive relief to prevent further infringement.
You can still protect your mark even if you have not registered it as a trademark, through the common law action of ‘passing off’. The underlying principle of this action is that “A man is not to sell his goods under the pretence that they are the goods of another man” (Perry v Truefitt (1842)).
Passing off claims
To bring an action under passing off, a three-part test must be met. Firstly, your goods or services must have goodwill attached to them. Goodwill is the idea that specific goods or services have a particular image and reputation attached to them, which enable the public to easily recognise those particular goods or services. Secondly, there must also be a misrepresentation to the public (which does not have to be intentional) which would lead, or is likely to lead, the public into believing that the goods or services on offer are those of the other company. Finally, there must be damage to the goodwill of the company bringing the claim.
There are several remedies available when a claim of passing off has been successfully established:
- Interim injunction. This may be obtained by a claimant before a full trial has commenced. It will stop the defendant from continuing to ‘pass off’ the goods or services in the interim period to protect the claimant’s goodwill from incurring further damage.
- An order for the delivery up or destruction of the infringing goods
- The claimant may seek damages for loss of sales or damage to goodwill.
- Account of profits. This is an alternative to damages and is a remedy rarely sought. It allows the claimant to seek the defendant’s profits from the date of the commencement of proceedings or letter before action.
Patent & Design Right Infringement
Patent rights are given to inventors in order to protect their invention from being copied without their permission for a period of 20 years. It goes further than copyright law as it protects inventions even if they were not directly copied and were developed completely independently.
So if a person came up with the same invention on their own, the person with the patent would still have a monopoly on the invention. Patents need to be registered to receive this protection. Patents can be obtained on both products and processes.
What can be protected by a patent?
The following criteria must be met before a patent must be granted on an invention:
- It must be new. The invention cannot have been made available to the public previously.
- It must involve an ‘inventive step’. A subjective requirement which means that the invention must not be obvious to someone skilled in that area.
- It must be capable of industrial application. It must be able to be used in some area of industry.
There are some exceptions to what inventions are patentable. For example, scientific theories and mathematical methods.
Making a claim for patent infringement
The Patent Act 1997 governs claims for patent infringement. To make a claim, you must be either the proprietor of the patent or an exclusive licensee.
There are various acts that constitute an infringement. There is a slight distinction between the claims that can be made regarding a patented product or a process. For a patented product, the offences are:
- Making, disposing of, offering to dispose of, using, importing or keeping the product.
For a patented process, the offences are:
- Using the process or knowingly offering the process for use; and
- Disposing of, offering to dispose of, using, importing or keeping any product obtained directly through the patented process.
These offences directly infringe on the owner of the patent’s rights. A claim can also be made if someone indirectly infringes on the patent proprietor’s rights.
This is where someone supplies or offers to supply in the UK a person with any of the means for putting the invention into effect, relating to an essential element of the invention.
There is a knowledge requirement for this offence meaning that the person who is accused must have known or it would have been obvious to a reasonable person that the means are suitable for putting the invention into effect in the UK and are intended to do so.
The essential element of patent infringement is that it is done without the permission of the proprietor.
Once the claim has been made, the Defendant may be able to defend the claim using one of the statutory exceptions under the Patent Act or other defences. For example, acts done privately do not constitute patent infringement; they must be done in a commercial context. Other defences include experimental use and prior use.
Remedies for patent infringement include:
- Interim injunction. This may be obtained by a claimant before a full trial has commenced. It will stop the defendant from continuing to us the patented product or process until the outcome of the trial.
- Final injunction. An injunction to prevent the defendant using the product or process from that point on.
- An order for the delivery up or destruction of the infringing goods.
- Damages. The claimant may seek damages for loss of sales or damage to goodwill.
- Account of profits. This is an alternative to damages and is a remedy rarely sought. It allows the claimant to seek the defendant’s profits from the date of the commencement of proceedings or letter before action.
Our specialist Patent and Design Rights Solicitors will be able to advise as to the best steps to take to protect your business’ Patent and where necessary can seek injunctive relief to prevent further infringement.
Design Right Infringement
What is design right?
Design rights are a relatively new concept that were brought in to cover functional designs with no aesthetic appeal that had been difficult to protect under the previous law. Design rights instead apply to the appearance of a functional product. It is similar to copyright in that you do not need to register your design right to receive protection and they are governed by the Copyright, Designs and Patents Act 1988 (CDPA).The CDPA gives protection to the owner for either 10 or 15 years depending on the years in which the design was first recorded and made available for sale or hire.
Design rights give the designer the exclusive right to reproduce the product and to record the design of the product with the purpose of reproducing it. Primary infringement exists if either of these are done without the designer’s permission.
Secondary infringement can also exist when someone deals with an infringing product. The infringer must have knowledge that the products infringe on a design right, or have reason to believe that they are.
The remedies for design right infringement are very similar for the remedies for patent infringement and include:
- Damages. In addition to basic damages, the Court may award additional damages in certain circumstances where it is considered just.
- An injunction to prevent further infringement of the design right.
- An order for delivery up or destruction of the infringing goods.
What is copyright?
The law of copyright is set out in the Copyright, Designs and Patents Act 1988 (‘the CDPA’) and gives protection to certain ‘property’, granting the owners exclusive rights regarding that property. The purpose of copyright law is not to create a monopoly over ideas, but instead to protect the form in which the ideas are expressed. There is no form of registration for a work to receive copyright protection. It is automatic when a work falls into certain categories.
Categories of copyright works:
- Literary works. The most obvious examples of literary works are books, poems and instructions. However, it extends to computer programs, tables and databases.
- Dramatic works. These must be a ‘work of action’.
- Musical works. A work consisting of music. If there are words intending to be sung etc. with the music, these may be protected separately under ‘literary works’.
- Artistic works. These consist of photographs, drawings, painting, sculptures, graphic works, architecture and works of artistic craftsmanship.
- Sound recordings. A recording of sound which can be reproduced.
- Films. Recordings of a moving image that can be reproduced.
- Broadcasts. A visual image, sound or information that can be electronically transmitted to the public.
- Typographical arrangements of published editions. Arrangements of published editions under literary, dramatic or musical works.
How copyright arises and duration
Copyright automatically exists on original works. The person who owns the copyright will generally be the author of the work. There are some exceptions to this rule however, for example if the work is made by a person in the course of their employment.
Copyright will protect a work for a different number of years depending on which category the work falls into. For literary, dramatic, musical and artistic works it is generally 70 years from the end of the year in which the author of the work dies. The period for computer generated work is calculated in the same way but lasts for a period of 50 years.
Films have copyright protection for 70 years from the end of the year in which the last person dies of the specified persons. Sound recordings are protected for 50 or 70 years depending on whether the work was published or communicated to the public.
Copyright infringement occurs when someone carries out certain acts regarding the work without the permission of the author. These acts are:
- Copying the work;
- Issuing copies to the public;
- Renting or lending the work to the public;
- Performing, showing or playing the work in public;
- Communicating the work to the public; and
- Making an adaptation of the work.
In addition to the acts of primary infringement listed above, there can also be secondary infringement of works protected by copyright. This does not concern actual copying of the work but instead makes it illegal to carry out certain activities in relation to an infringing article.
These are listed in the CDPA and include activities such as importing infringing copies and providing apparatus for such an infringement.
Whilst primary copyright infringement is strict liability, meaning that you can be found guilty of an offence even if you did not know what you were doing was illegal, secondary infringement does need to be committed with some knowledge or reason to believe that the article is an infringement of copyright.
There are various remedies available to a copyright holder, including:
- Damages for any loss they have suffered;
- Injunctions to prevent further infringements;
- Order for delivery up of the infringing articles;
- Forfeiture; and
- Right to seize the infringing articles.
Our specialist Intellectual Property Solicitors will be able to advise as to the best steps to take to protect your business’ Intellectual Property and where necessary can seek injunctive relief to prevent further infringement.
Domain Name Infringements
What is a domain name?
A domain name is the part of a URL (the address through which a website is accessed e.g. myerson.co.uk) which is unique to a particular website. Each domain name must be unique so that no two are identical.
When the domain name server system was established, it was not predicted that domain names would have any value. However, as the internet became more commercial and widely used, companies began to realise the value of domain names and began suing each other for the right to use a particular domain name. Conflict arises when:
- Someone deliberately registers a domain name which another party needs or would like and then seeks either to sell it to that party or use it in order to damage the other party (“cybersquatting”); or
- Different parties have competing legitimate interests in the same domain name; or
- Large companies have used their legal and financial resources to prevent legitimate domain name holders from registering valuable domain names.
In 1999, the Internet Corporation for Assigned Names and Numbers (ICANN) introduced a system for resolving disputes over domain names. This is known as the Uniform Domain Name Dispute Resolution Policy (UDRP).
The UDRP requires domain name owners to formally arbitrate disputes where cybersquatting issues are raised. Many disputes have been resolved through the UDRP since the process came into force on 1 January 2000.
Domain name transfer restrictions during a dispute
A domain name holder is prohibited from transferring a domain name during the UDRP process or for 15 business days after a decision has been made by the UDRP panel. The UDRP also prohibits a domain name being transferred during court or arbitration proceedings unless the receiving party confirms in writing to be bound by the decision of the court or arbitration proceedings.
These provisions are designed to prevent domain name holders from transferring a domain name in order to avoid action under the UDRP or court or arbitration proceedings.
Relationship between trademarks and domain names
As a domain name is often used to identify the source of information on a website, in effect, a domain name can be used as a trade name or trademark. Therefore, domain names can be capable of being registered as trademarks.
Domain names may also infringe prior trademarks or common-law rights of others. This can be a particular problem for global domain names as they may potentially infringe trademarks which have local scope in a particular country.
Unfortunately, the question of whether domain names constitute property rights has not been fully explored by the Courts. The question therefore of how trademarks and domain names relate to each other remains unclear.
Valuing a Domain Name
A domain name may be valued by reference to:
- The cost of obtaining a domain name from a registrar;
- The amount of income or other economic benefit the holder of the domain name receives from the use of the domain name;
- The amount of income or other economic benefit a third party could derive from a domain name.
Most domain names are not unique and therefore tend to be valued using the first of the three methods above.
However, any domain name linked to a trademark will be valuable to the holder of the trademark as will any generic domain names which allows someone to exploit the name commercially – in such a case, the last of three methods above will be used to value the domain name.
There are a number of specialist companies who can provide valuations for domain names. As the internet becomes more important, the value of domain names will only carry on increasing and there will be a rise in domain names being bought and sold.
Our specialist Intellectual Property Lawyers are able to protect your business’ rights and prevent passing off or infringement of a Trademark.
If you require any further information or wish to discuss any issues relating to domain name disputes with one of our specialist solicitors, please do not hesitate to contact us.
What is Parallel Importing?
This is when a UK based trader buys goods bearing trademarks from outside the UK and sells the goods in the UK without the trademark owner’s permission potentially infringing the trademarks.
One exception to this rule is if the goods imported have already been placed on the market in the European Economic Area (EEA) with the trademark owner’s consent. In such a case, which is known as exhaustion, the trademark proprietor cannot object to the importation.
An example of this would be if a trademark owner allows goods to be put on the market in Spain, the trademark proprietor cannot object to a UK trader buying the goods in Spain and then selling them in the UK.
Generally speaking, a trademark proprietor will expressly consent to goods being sold in the EEA, although such consent can also be implied in certain circumstances.
Parallel importation is an issue for many multinational companies who may sell their goods at different prices depending on the country they are being sold in.
Parallel importers exploit these price differences by buying goods at a lower price in one country and then reselling them at a higher price in a different country. This can lead to prices falling in higher priced territories.
Preventing Parallel Imports
One way to prevent parallel imports is to rely on intellectual property rights, particularly those relating to trademarks. The European Court of Justice has held that brand owners can rely on trademark rights to prevent the sale of parallel imports from outside the EEA.
Other intellectual property rights may be relevant, for example copyright, patent and design rights. Copyright is the exclusive right which arises automatically on the creation of an original literary, artistic and other works and which protects the work being copied for a period of 70 years after the author’s death.
Patents are the exclusive right to exploit inventive technology for a period of 20 years after a formal application is made, investigated and granted. Design rights protect the appearance, shape and configuration of a product and can be registered or unregistered.
To be capable of registration, a design must be novel, of individual character and not excluded by statute.
One method that may be available to stop intellectual property rights being exhausted is a restricted intellectual property right licence. However, such licences must comply with EC competition law and the rules differ depending on whether the licence is granted inside or outside the EU.
EC competition laws aim to prevent restrictions on trade between EU member states. On many occasions, the European Commission has imposed heavy fines on companies who try to impose restrictions on free movement of goods.
Any strategy to prevent parallel importation must tread a careful line between relying on contractual rights and avoiding EC competition rules.
We are able to bring applications for injunctions on behalf of manufacturers and trade mark owners, where necessary and defend similar applications on behalf of importers.
What is Comparative Advertising?
A comparative advertisement is one that explicitly or by implication identifies a competitor or goods or services offered by a competitor.
There are instances when a comparative advertisement is lawful. A comparative advertisement will be permitted under the Comparative Advertising Directive if it fulfils the following conditions:
- It is not misleading i.e. the advertisement does not deceive or is not likely to deceive those it is addressed to or who may watch it and does not affect economic behaviour or injure or be likely to injure a competitor.
- It compares goods and services which meet the same needs or which are intended to be used for the same purpose.
- It objectively compares features of goods and services, including price.
- It does not discredit trademarks, trade names, other distinguishing marks, goods, services, activities or circumstances of a competitor.
- It does not take unfair advantage of the reputation of a trade mark, trade name or other distinguishing marks of a competitor.
- It does not present goods or services as imitations or replicas of goods or services which bear a protected trademark or trade name.
- It does not create confusion in regards to the advertisers and competitor’s trademark, trade names, other distinguishing marks, goods and services.
If a comparative advertisement does not fall within these rules, this will expose the advertiser to claims for trade libel, malicious falsehood, infringement of copyright and passing off.
Legitimate comparative advertising must not take advantage of a competitor’s reputational trademark, trade name or other distinguishing features of a competitor’s products and/or services. This is known as unfair advantage.
Other than bringing trade mark infringement proceedings, individual consumers or businesses cannot take direct action if they have a complaint regarding comparative advertising.
However, in the UK, the government has legislated to allow certain authorities (primarily the Competition and Markets Authority (CMA)) to initiate proceedings on behalf of traders and consumers.
The CMA, Trading Standards Services (TSS) and other consumer protection organisations can seek Court orders preventing the publication of unlawful comparative advertisements.
However, TSS can first require that all other ways of dealing with the complaint i.e. via the Advertising Standards Agency (ASA) are used and have failed to prevent the continual use of the offending advertisement(s). However, the ASA will only entertain complaints from competitors if no legal action is envisaged or in process.
The ECJ and the English Courts have historically tried to accommodate comparative advertising as it is seen as conducive to healthy competition in the EU.
As such, the Courts are reluctant to grant injunctions preventing comparative advertising and have relied on Article 10 of the European Convention on Human Rights (the right to freedom of expression) to refuse injunctive relief.
What is trade libel?
Trade libel is part of the more general principle of defamation. Where the defamation is made in a permanent form, such as in in writing, online or broadcasting, the defamation will be classed as libel.
Therefore, trade libel is where a publication of a false statement of fact is made that intentionally disparages the quality of the goods or services of a business and the business suffers damage to its goodwill.
The number of claims for trade libel has increased significantly over recent years due to the increase in new media publishing, such as blogs and social networks. The Defamation Act 2013 covers this area of law.
Bringing a claim for trade libel
There are various elements of the claim that the claimant must establish. Firstly, the words complained of must be defamatory to the claimant. There is no definitive definition of what constitutes ‘defamatory’ words but you can generally think of it as a statement which is untrue and which would make reasonable people think badly of the claimant.
These defamatory remarks must have been published to a third party and the defendant must be responsible for the publication. The most common types of publications in these cases are books, newspapers, internet articles and television programmes. The person responsible for its publication is usually the author, editor or publisher of the work.
Lastly, the remarks complained of must identify the claimant. This is obvious if the publication refers to the claimant, but sometimes it can be more difficult to prove when it does not specifically mention them. In those cases, the identification element will be met if reasonable people would assume the remarks refer to the claimant.
The focus of the dispute in most cases is whether any of the defences apply. The following defences may be used:
- Truth. If the defamatory statement is true the claim cannot succeed
- Honest opinion.
- Public interest. New defence under the Defamatory Act
- Absolute privilege. In certain circumstances the possibility of a trade libel claim is automatically precluded. For example, in judicial and parliamentary proceedings
- Qualified privilege. Either statutory or common law
- Peer-reviewed statements in scientific and academic journals
- Internet defences
- Offer of amends. The publisher can offer to make the claimant an apology and correct the statement in question, and pay damages
The remedies available for trade libel include:
- Damages. This is the most common form of remedy. There are four different types of damages that can be awarded in a claim for trade libel. General damages will compensate the claimant for any loss caused by the defamatory statement. The court can also award special damages for any specific pecuniary loss that can be proved. Exemplary damages go beyond compensating the claimant and are awarded in rare circumstances where the defendant maliciously made the defamatory statement.
- Order to remove statement of cease distribution.
- Offer of amends. If a defendant admits that they have committed a libellous act against the claimant, they can make an offer of amends which will stop proceedings being brought or continued against the defendant, if accepted. An offer of amends usually constitutes of an apology and a suitable correction. The amount of damages that the court will award will substantially decrease if an offer of amends is made.
- Interim injunction. Injunctions are only used in exceptional circumstances to restrain a defendant from publishing defamatory material. This needs to be balanced against the principle of freedom of expression and so is very difficult to obtain.
We are experienced in seeking injunctive relief to prevent further publication and obtaining retractions, apologies and damages for compensation.
What is malicious falsehood?
Malicious falsehood is similar to libel except that the statement published does not necessarily have to be defamatory. The statement still has to be false and cause damage to the claimant, but it does not have to suggest anything bad.
Elements of malicious falsehood
The statement published by the defendant must be false. However, the most important element of establishing this claim is that there must be ‘malice’ behind the publication of the statement.
The publisher must either publish the material with a malicious motive, or know it to be false or be reckless as to its truth. This means that even if the publisher believes that the statement is true but it is later revealed to be false, if they had published in with the intention of causing the claimant harm they could still be liable.
Damage is no longer a necessary component to prove in malicious falsehood claims. You merely have to prove that the material published was calculated to cause damage to the claimant or is likely to cause such damage.
Similarly to a claim for trade libel, the false material must refer to the claimant or their business.
Misuse of Confidential Information
It is a basic legal principle that a person who has received information in confidence cannot take unfair advantage of it and cannot use the confidential information without obtaining the consent of the person who passed on the information.
To be protected by the law of confidential information, the information must be confidential in nature and disclosed in circumstances importing an obligation of confidence.
The rights conferred by the law of confidential information can be enforced against the recipient of the information and also against any subsequent third parties who were provided with the confidential information even if the third party did not know that the information was confidential when it received the information.
However, any third parties must become aware later on that the information was confidential.
Disputes can often arise as to whether the information was actually confidential. Whilst it may be obvious in some cases, such as in the case of a secret formula, in other instances, the information may be similar to that already in the public domain.
Circumstances where an obligation of confidentiality arises
An obligation to keep information confidential can be imposed by contract, implied because of the circumstances of the disclosure or implied because of the special relationship between the parties concerned e.g. employee and employer.
The test that the Courts will apply when looking at the circumstances of the disclosure is whether a “reasonable man standing in the shoes of the recipient of the information would have realised upon reasonable grounds the information was being given to him in confidence”.
If a party hands over particular information and states that it should be treated as confidential, then the recipient should be well aware of its obligations. However, confidential information is not always disclosed in such a formal context and may just be picked up during the course of a conversation.
If no express requirement of confidentiality is imposed, there may be doubt as to whether or not the recipient is aware of its obligation to keep the information confidential.
The relationship between parties may also, on occasion, create confidentiality obligations. The most common example of this is the relationship between an employee and an employer where every employee is held to be under a duty to keep the employer’s secrets.
This duty also applies to ex-employees but to a lesser extent.
The best way to protect confidential information is to enter into a stand-alone confidentiality agreement before the confidential information is disclosed. Our Corporate Commercial Team can advise on the drafting and implementation of such confidentiality agreements.
Confidential information can be disclosed in a limited context but still be confidential. For example, professional advisors such as solicitors, accountants and bankers will receive information under strict terms of confidence as will officials who are supplied with information for the purposes of statutory requirements.
In other cases, information supplied to other individuals and companies e.g. contractors and sub-contractors which enables them to carry out their contractual obligations should be made subject to an express obligation of confidence limiting or barring their right to disclose the confidential information.
Duration of Protection
Confidential information can be protected for as long as it remains confidential which, in theory, could be forever. However there are a number of restrictions to this:
- Information which becomes out of date and which ceases to have any commercial value;
- Confidentiality agreements which are time-limited;
- Time-limited restrictive covenants in an employee’s employment contract; and
- Technical information provided to public authorities for securing regulatory approval are typically time-limited.
Examples of confidential materials which may be protected
- Formulas not capable of analysis in the final product;
- Recipes which are not apparent from the final product;
- Business methods (until they are used in public);
- Financial and statistical information;
- Customer lists;
- Plans, sketches and drawings;
- Improvements to products or processes;
- New inventions whilst a patent application is pending;
- Business plans;
- Computer programs; and
- Discoveries, scientific theories or mathematical methods.
Enforcement and Remedies
A successful claimant in an action for misuse of confidential information is entitled to either an account of profits or an inquiry as to damages.
The usual measure of damages is that the defendant should compensate the claimant for the loss which the defendant has caused to the claimant.
In some circumstances, however, the damages payable can be calculated by reference to the fee the parties would have agreed would be payable by the defendant for the use of the confidential information in a hypothetical bargain.
The Courts have also shown a willingness to issue and continue injunctions in certain instances, particularly where a disclosing party uncovers the recipient’s intention to use the confidential information before the breach of confidentiality takes place.
However, injunctions are of little or no use once the information has been disclosed or used.
We are able to advise at the outset and where necessary seek injunctive relief against the misuses of confidential information to prevent further damage.
Please contact one of our specialist Intellectual Property Solicitors to discuss your situation further without obligation.
Intellectual Property Lawyers Association (ILPA)
We are members of the Intellectual Property Lawyers Association (ILPA). The ILPA is an association of 66 law firms who have an established intellectual property department.
Key activities of the ILPA:
– Representing the solicitors’ profession in the Users’ Committee of the Intellectual Property Court and the Intellectual Property Enterprise Court
– Monitoring the progress of relevant national and European legislation and participating in consultations