IPPro Issue 15 by IPProMagazine

Spring Special

David Lossignol

INTAâ&#x20AC;&#x2122;s new president tells all

Software Patents

Justin Simpson proposes a new type of patent: the software patent

Brexit

The uncertain storm

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In this issue

p24

INTA President

Brexit Update

Latest News · Copyright

TAG launches project to tackle ads on pirate sites The Trustworthy Accountability Group (TAG) has launched an initiative that will notify European brands if their content is featuring in adverts on pirate sites. Project Brand Integrity will be implemented by TAG and White Bullet, who will monitor and document ads on infringing sites. TAG conducted a similar effort in 2016 along with CreativeFuture in the US. That effort saw a 90 percent reduction in the number of impressions on pirated content sites in the US. According to TAG, Project Brand Integrity will “help advertisers and their agencies avoid brand risk and damage by monitoring pirate sites and alerting them to the placement of their ads on those sites”. TAG CEO, Mike Zaneis, commented: “If you are a brand advertiser, the skull-and-crossbones isn’t just a pirate movie trope. It accurately reflects the toxic danger of associating your brand with stolen content and criminal activities on pirate sites.” “Project Brand Integrity will serve as an early warning system for advertisers and their agencies, so we can alert them when their ads have run near stolen content and help them implement effective safeguards to prevent it from happening again.”

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“We are delighted to work with White Bullet to jointly enable this programme while advancing the European Commission’s important work in this area.” With the introduction of Project Brand Integrity, TAG said it will continue to work with law enforcement, including the City of London Police Intellectual Property Crime Unit (PIPCU) and Europol to further raise awareness of the program and support brands and their agencies in their compliance efforts. Detective constable Steve Salway of PIPCU added: “We are always pleased to see the introduction of initiatives such as Project Brand Integrity that uphold similar values to our own. PIPCU is at the forefront of combating digital piracy.” “Our Operation Creative sees City of London Police officers disrupt criminal activity online by working with content owners and internet service providers. As a result, we have seen over 1,800 illegal websites cease to operate, protecting UK consumers along with the preservation of the UK creative industry.” Alongside the project’s launch, TAG also released a white paper that outlines best practices for companies dealing with the adverts on pirate sites. Best practices described in the white paper include working closely with partners to develop and execute your strategy, holding partners accountable, and employing the right tools. www.ippromagazine.com 10

Trademarks · Latest News Palm restaurant secures $120 million in historic trademark ruling The Supreme Court of New York has entered into a final judgement in a $120 million trademark dispute regarding the famous Palm restaurant. The restaurant, which opened in 1926, is currently owned by two grandsons of the original owners, Walter Ganzi and Bruce Bozzi. They own an 80 percent stake in the company that owns the Palm name, with their cousins owning the remaining 20 percent. The grandchildren opened over 20 additional Palm restaurants using wholly-owned companies and then licensed the rights to use the Palm name, logo, and other IP to themselves at a flat rate per restaurant regardless of sales. The cousins, Gary Ganzi and Claire Breen had challenged the flat fee royalty rate, which was set over 40 years ago, claiming that it was substantially below market. The Supreme Court of New York agreed with the cousins, ruling that a royalty should be based on a percentage of gross sales. New York Supreme Court justice Andrea Masley has now annulled all Palm restaurant licenses as having been products of “a textbook example of fiduciary misconduct”.

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The royalty, set at five percent of gross sales, has now been determined and granted against Ganzi and Bozzi, who were found to be executing self-dealing, undervalued licence agreements favouring Palm restaurants they personally own. Over $119 million has been assessed against Ganzi and Bozzi. Fred Newman, founding partner of New York law firm Hoguet Newman Regal & Kenney and co-lead trial counsel for the plaintiffs called the royalties awarded “a huge number. We challenged the flat fee royalty rate, set over 40 years ago, and won.” “This was a hard-fought battle and a much-deserved outcome for our clients.” The initial awarding in November of last year marked the first time a trial court had fully determined the correct and proper way to license valuable IP through a percentage of sales methodology.

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Latest News · Trademarks City of London, UK

ICE seizes $24.2 million worth of fake sports goods US Immigration and Customs Enforcement (ICE) has seized nearly 285,000 counterfeit sportsrelated items worth an estimated $24.2 million. The seizures were part of collaborative work with Homeland Security Investigations, and the US Customs and Border Protection. The seizures made have led to investigations that have resulted in 28 arrests with 21 convictions. The figures released by ICE were part of Operation Team Player, an ongoing collaborative effort to halt the illegal importation and distribution of counterfeit sports merchandise. The statistics were released during a joint press conference in Atlanta, Georgia, with the CBP, National Football League, Atlanta Police Department and Department of Justice. The location is significant given it was where the Super Bowl took place this year. Seized items included fake jerseys, hats, and mobile phone accessories. NFL vice president of legal affairs, Dolores DiBella commented: “The NFL values its partnership with the IP Rights Center, ICE, HSI, CBP, and Atlanta law enforcement, whose joint anti-counterfeiting enforcement efforts protect consumers from predatory sellers who seek to illegally profit from our fans’ enthusiasm for their team and the Super Bowl championship game”. “The NFL is committed to supporting law enforcement’s anti-counterfeiting and consumer protection measures. The dedicated work of law enforcement is integral to any successful anti-counterfeiting operation, and we extend our appreciation and gratitude to every agent and officer engaged in Operation Team Player.” CBP commissioner Kevin McAleenan added: “Collaborative efforts, such as Operation Team Player, ensure that the health and safety of the American people and the vitality of our economy are preserved.”

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Close to £1 billion worth of IP crime disrupted by PIPCU since 2013 The City of London Police’s Intellectual Property Crime Unit (PIPCU) has disrupted nearly three-quarters of a billion worth of IP related crime since its inception in 2013. After a stellar year that saw PIPCU tackle a range of IP infringements, including counterfeit airbags and poppy merchandise, it brought its overall disruption total to £719 million. Since its 2013 inception, PIPCU has taken down over 66,500 websites suspected of selling counterfeits. Over half of the websites were believed be selling counterfeit clothing. PIPCU has also added over 1,500 copyright infringing websites to its Infringing Website List and has suspended over 1,800 further. The Infringing Website List is an online portal that contains an up-to-date list of copyright infringing sites, identified and evidenced by the creative industries and verified by PIPCU. Detective chief inspector Teresa Russell commented: “Since its inception in 2013, PIPCU has become a leader in IP enforcement. It has combated counterfeit hard goods and digital piracy to such a high level that it is now being held as an example to other forces internationally.” “To have disrupted £719 million worth of IP crime over the past five years is a remarkable achievement and something that we will continue to build upon in the coming year.” Ros Lynch, director of copyright and enforcement at the UKIPO, added: “Partnership working is vital in the fight against IP crime.” “We are delighted that our collaboration with PIPCU has led to demonstrable success in disrupting this type of criminal activity.” www.ippromagazine.com 12

Appointments · Latest News

Bill Mason

David Stein

Young Feui

Peter Firey

Clint Stuart

Evan Liebovitz

Harness Dickey hires six new IP attorneys Harness Dickey has added six new attorneys across its Washington DC and Dallas-Fort Worth offices. David Stein, Evan Liebovitz and Peter Firey have all joined the firm’s Washington DC office. Stein brings more than 15 years of patent counselling experience and has previously held an in-house counsel role at the Cleveland Clinic. He joins the firm from Cooper Legal Group and is a former director of the National Association of Patent Practitioners. Liebovitz focuses on patent preparation and prosecution for clients in the consumer electronics, software, mobile device and computer technology industries. He joins the firm as an associate, having previously been a research assistant at the Florida State University College of Law. Firey, who also focuses his practice on patent preparation and prosecution, will be joining the firm as an associate. He brings with his extensive experience from his time as an engineer. The firm’s Washington DC principal, Gary Yacura, said Harness Dickey is “excited to start 2019 with a deeper bench of talented attorneys”.

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He commented: “We are seeing a tremendous opportunity for growth from our clients this year. We look forward to providing even more efficient and comprehensive solutions to our clients’ legal challenges.” In Dallas-Fort Worth, the firm welcomed the arrival of Bill Mason, Clint Stuart and Young Fei. Mason brings over two decades worth of experience. He spent 15 of those as former in-house counsel in the medical device and biotechnology sectors for the likes of CaptureRx, CeloNova BioSciences, and Seno Medical Instruments. He is well versed in both patent portfolio development and monetisation. Stuart brings two decades worth of IP law experience with him. A former senior IP counsel for Wick Phillips, Mason joins the firm and will continue to focus his practice on patent preparation, prosecution, and counselling across the medical device, personal protective equipment, and oilfield fields among others. Fei focuses his practice on preparing and prosecuting patent applications with an emphasis on medical devices. A fluent Mandarin Chinese speaker, he is a former SPAWAR Systems Center Pacific patent attorney. www.ippromagazine.com 13

Latest News · Appointments Washington DC, USA

Bipartisan leadership announced for US senate judiciary subcommittee on IP Republican Thom Tillis and Democrat Chris Coons will lead the US Senate Judiciary Subcommittee on Intellectual Property. Tillis will be chairman, while Coons will be ranking member. The subcommittee will focus on promoting American innovation and economic development. The jurisdiction of the subcommittee will include the US Patent and Trademark Office, the US Copyright Office, oversight of the functions of the federal government as they relate to IP, patents, copyrights, trademarks, and trade secrets. Joining senators Tillis and Coons will be Republican senators Lindsey Graham, Chuck Grassley, John Cornyn, Mike Lee, Ben Sasse, and Marsha Blackburn, alongside Democrats Patrick Leahy, Richard Blumenthal, Kamala Harris, Sheldon Whitehouse, and Mazie Hirono. Tillis commented: “IP plays an important role in our nation’s long term economic success and national security. In recent years our country has been faced with a number of challenges in our IP system, from rampant theft from state actors like China, to confusion among innovators and inventors about what is even patentable.” “These issues are causing our nation’s economy to lose billions of dollars annually and threaten our country’s long-term technological dominance.”

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He added: “I want to thank chairperson Lindsey Graham and ranking member Dianne Feinstein for allowing senator Coons and I to focus on these issues at the subcommittee level for the first time in years.” “I’m committed to working with ranking member Coons on a bipartisan basis to examine the current state of IP in the US and make targeted improvements to our IP framework that protect and promote America’s innovation economy.” Coons added: “The US is the most innovative country on the planet. To stay at the top, inventors must be supported by strong intellectual property laws that encourage and reward research and development and that penalise and deter IP theft.” “The founders understood this, and that’s why they specifically empowered Congress in the Constitution to create a nationwide patent system to—as they put it— ‘promote the progress.’” “The US needs to better protect innovation—the lifeblood of our economy—and this subcommittee will provide an important forum for addressing these critical policy issues.” “I look forward to working with chairperson Tillis to improve and clarify US patent law, celebrate inventions that improve Americans’ lives, and promote global protection of IP.” www.ippromagazine.com 14

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YOUR IP SOFTWARE SOLUTION IN THE CLOUD

Domain name defense: The heart of a companyâ&#x20AC;&#x2122;s strategy Nathalie Dreyfus of Dreyfus discusses the importance of brands defending their domains as the number of cyber attacks rises Cyber attacks are now considered the main risk for businesses as it becomes increasingly difficult to detect them. Their consequences go far beyond direct economic damages, to the costs related to responsive actions after the detection of a cyber attack, companies must add long lasting consequences and hidden costs, the economic impact of which is much harder to measure: paralysis of services, high customer loss, theft of confidential information and serious damage to the reputation of the company. Some 20 percent of buyers say they do not want to come back to a brand that has been the victim of a cyberattack and 43 percent of companies found that a successful cyber attack resulted in a loss of reputation. A cyber attack undeniably effects the trust capital of the brand.

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Knowing that 92 percent of French companies were victims of cyber attacks in 2017 (which represents an increase of 12 percent in one year), domain names are threatened now more than ever. Cyber-hackers often use fraudulent domain names to harm a company, through various techniques of cybersquatting, because the domain name is often composed of the brand name or the corporate name. In 2016, the Vinci Group paid the price of such an attack, following the release of a false press release announcing accounting irregularities and the dismissal of its director of financial affairs. This document referred to a copy of the Vinci Groupâ&#x20AC;&#x2122;s website, accessible under the fraudulent domain name vinci.group. Although quickly denied by the group, the news immediately caused the groupâ&#x20AC;&#x2122;s share price to fall by more than 18 percent, www.ippromagazine.com 16

Cyber Attacks · Analysis and it remained in the red through to the end of the day, resulting in a devaluation of around 4 percent. Domain name risks are particularly important for companies, both from a business point of view and in terms of compliance with new regulations, as they must protect simultaneously their assets, their customers, and their shareholders. The changing judicial environment is making it even tougher.

Anticipating risks The Vigilance law required companies to carry out risk mapping and take the necessary measures to minimise them in order to guarantee the safety of individuals. Following the same guidelines, the Directive on the security of Networks and Information Systems (NIS Directive) and the General Data Protection Regulation (GDPR) impose a new paradigm for the defense of companies and their brands on the internet. In order to release a company and its managers from their responsibility, it is no longer sufficient to intervene ex post facto by proving to have acted after having known of the infringements: it is now imperative to demonstrate that all measures have been taken to ensure that risks are neutralised or minimised. Accountability and compliance become the watchwords of the company.

It is now imperative to demonstrate that all measures have been taken to ensure that risks are neutralised or minimised

of cases. Communication with the domain name’s owner is now only possible through the registrars, which are responsible for sending them letters of formal notice or making contact forms available. All this enables fraudulent domain names registrants to act shamelessly. This new distance between the various interlocutors and the lack of transparency as to their identity creates a framework that seems more conducive to enabling fraud than preventing it and makes defense on the internet more complex. However, and it might seem quite contradictory, the current case law tends to consider that internet users must be particularly attentive and can often avoid a phishing campaign or an attack. France’s Commercial Court of Cassation ruled: “serious negligence (…) may in particular result in the payment service user’s response to a phishing email requesting the communication of confidential data allowing the use of said service”. The determination of the user’s liability becomes easier. If this might seem to relieve companies from their responsibility, it does not. They must be even more vigilant in the face of cyber risks so they will not lose their customers and continue protecting them. If the defense of the brand was already more difficult in the digital and new technologies era, it is now all the intellectual assets of the company that are threatened by cyber attacks, and this threat is gaining momentum.

Hacking of intellectual assets in sight

Beyond the hardening of the rules for companies concerning the protection of the personal data they handle, this new framework also makes it more difficult to identify fraudsters. To comply with the provisions of GDPR, ICANN has set in place a temporary model for WHOIS data publication. In order to respect the new principles surrounding the protection of personal data, the data accessible via WHOIS servers is limited to the country of the holder of the domain name and the name of the company that registered the domain name.

More than one-third of cyber attacks aim at the theft of IP. Though at first glance we think of risk as being foreign to the company (we often think of hackers), we must not underestimate the threat that competitors represent, since they no longer carry out only financial theft but also industrial spying and piracy. For example, cyber attacks targeting the theft of sensitive financial and strategic information (such as IP) are becoming more widespread, especially from China. At the end of 2018, Agence France Presse relayed information from Australian media denouncing a proliferation of attacks from China attempting to steal their IP, their industrial and military secrets.

All other data (surname, physical address, email) are personal data in the definition of GDPR for which access must be restricted. Although they are accessible upon request (to the extent a legitimate interest has been demonstrated), this has direct and immediate effects on the surveillance and defense of brands and associated domain names: the identification of fraudsters is considerably more difficult and time-consuming, as is the consolidation

Beyond the classic method of cybersquatting, which consists in the abusive registration of a domain name linked to an earlier right (brand, corporate name, surname), it is clear that there has been an increase in organised fraud: phishing operations, customer embezzlement, ‘parking’ pages, fake websites, homograph attacks, aggravated online counterfeiting (especially in China where the actions are particularly complex and expensive), drop-catching, and more.

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Analysis · Cyber Attacks The inactivity of registered domain names is also likely to strongly affect the activity and the value of a company. Faced with this trend of worsening attacks, and in accordance with the new regulatory framework, it is essential for companies to adapt and strengthen the defense strategy of their domain names.

The need to use means of protection adapted to different goals The corporate brand is particularly vulnerable to cyberattacks, to the extent that it is used for all cross-functional functions and can be exploited for products and services intended for consumers. Current brand protection strategies for brandname domain names vary according to a company’s goals, ranging from setting minimum actions, such as disabling fraudulent sites, to full systematic actions, such as zero tolerance and continuous monitoring. Even if solutions to protect domain names registered by the company already exist (SSL certificates, Registry Lock), as well as procedures to recover a fraudulent domain name, such as the UDRP, this is unfortunately not enough anymore. The defense and surveillance strategy must evolve to take into account the most serious attacks and become proactive in preventing potential fraud while controlling costs. The ideal strategy will therefore need to prevent fraud or phishing attacks, implement rapid action to stop serious harm and differentiate between surveillance and protection for each brand.

In parallel with the development of a strategy to defend domain names, new tools are emerging to protect the company itself. Because compliance and accountability are now legal obligations, imposing a duty to anticipate risk, companies are facing more responsibilities in the eventuality of an unpredictable or unstoppable cyberattack. Therefore, cyber insurance is expanding—especially in the US—as a means to protect the company if such an event occurs. This mechanism generally covers all kinds of damages, from the costs and losses caused by the attack, to the civil liability in case of personal data leakage. Cyber insurance is very likely to flourish in Europe as well, since it fits perfectly within the scope of Vigilance Law, the NIS Directive and GDPR. In fact, cyber insurers require companies to identify the potential risks they could be facing and their weak points, which is extremely similar to the risk mapping and the compliance imposed by the European regulations. The environment around cyber risks and domain names is very likely to keep evolving in the coming years. It is therefore important to be aware of the risks and obligations that companies are facing, and the need to develop surveillance and defense around domain names. If this seems difficult to achieve, as the surveillance must be constant and global, these goals of proactivity, responsiveness and adaptability can nevertheless be accomplished with specific concrete solutions. At Dreyfus, we support you in the implementation of a defense strategy adapted to your company and your trademark.

It is important to be aware of the risks and obligations that companies are facing, and the need to develop surveillance and defense around domain names

Nathalie Dreyfus Trademark attorney Dreyfus Paris

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A new type of patent: the software patent Software specialist patent attorney and IP entrepreneur, Justin Simpson, puts forward his theory on how to resolve the decades-old arguments over the patentability of software Over three million patent cooperation treaty (PCT) patent applications have been filed in the 19 years since I filed my first invention for an online patent filing system and only 32 of those inventions made it to WIPO’s list of Notable Inventions. I’m proud to say that my invention is on that list under ‘patenting the PCT’, right up there with Google and Pfizer. Little did I know at the time I drafted the patent application for my patent-filing software that the patentability of software would get more and more challenging as the years went by. When I completed my computer science degree in 1994 (the year before the internet took off and made my degree redundant) and entered the patent profession in 1996, the prospects for patenting software were strong. Yes, there were some concerns about unduly broad software patents being granted, but that was mostly due to the lack of prior art intellectual property offices had to handle. Nearly 23 years on it is astonishing to see how little credit software inventions are given in the patent world today. I know of a number of senior and capable software-specialist patent attorneys who have left the profession due to their disenchantment with the direction courts are taking in relation to the patentability of software. This piece seeks to understand why the law has developed in the direction it has and to propose a solution, namely a new type of patent: the software patent.

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Software has value. Google, Facebook, and Amazon are software companies. Their core value is created by the clever software they have built. Those three companies alone are worth nearly $2 trillion. That’s nearly double the GDP of my home country, Australia. So why is it that software is not patentable? The reason is that the courts must base their decision on existing laws and past cases that were written well before software was invented. Laws that could not have envisaged the nature and role software plays in modern society. For example, in the UK and Australia, the basis for determining whether something can be patented is the Statute of Monopolies. That document was written in 1624 and defines patentable subject matter as “a manner of new manufacture”. Now I’m no historian, but even I know the 1600’s was a long time ago. Notable events that century include the Great Fire of London and the completion of the Taj Mahal. This was before the industrial revolution. Galileo was figuring out that the earth orbited the sun and men wore wigs with frill-necked shirts. It was in that era that the legislators of the day came up with ‘a manner of new manufacture’ as the standard for letters patent. Imagine travelling back in time to talk with the lawyers of that day and showing them how you access Facebook from your www.ippromagazine.com 20

Justin Simpson · Opinion

smartphone to find out what your friends had for breakfast. If you asked them if the software that drives the Facebook app should be patentable, what do you think would they say?

Hence a restriction found its way into UK legislation that software was not patentable ‘per se’ ie software alone, not linked to a machine, was not patentable.

Firstly they would probably have you beheaded for sorcery for creating such magic on a hand-held alien device. But if you somehow managed to save your neck, how would you explain software to them? Where would you even start?

Today we have an artificial situation whereby some of the most commercially valuable creative innovations are not protectable under patent law.

Explaining it to a 17th century lawyer would be an impossible task. Yet is the viewpoint of the 1600’s lawyer we still apply today to determine software patentability. Skipping forward a few hundred years, the case law analysing the patentability of software has similar problems. Prior to the invention of software there were physical machines. They were tangible. They worked. They did stuff. When the idea of patenting software arose, due to the separation of powers between the legislature and the judiciary, the courts couldn’t make up new laws for the patentability of software—they had to interpret the old laws and apply them to the new technology. In their attempt to try to figure out if software should or should not be patentable, the judges looked at the list of what was and wasn’t patentable. Mental processes were not patentable. Machines were. Software was a bit like a mental process, but if it was linked to a machine, perhaps it could be patentable? That’s a reasonable compromise, let’s go with that.

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In order to make them protectable, attorneys need to distort the way in which the software is described so that it sounds like it is inherently linked to some sort of hardware. You can have the most clever software ever created, but if it doesn’t make the machine run faster or reduce network traffic it can’t be protected by patent law. US patent law is no different. The Patent Act of 1793 defined patentable subject matter as “any new and useful art, machine, manufacture or composition of matter and any new and useful improvement on any art, machine, manufacture or composition of matter” which is almost identical to the wording of section 101 of the US Patent Act today and closely follows the 1600’s English law. These laws, written in the 1600’s and 1700’s, are the laws courts today have to base their decisions on. www.ippromagazine.com 21

The seminal decision of Alice v CLS Bank in 2014 established that software could only be patentable if it changed the way a physical machine worked or processed data. Why did the court make such a restriction? Because it was trying to find a dividing line between abstract ideas (which were not patentable) and physical machines (which were) in order to define the law for software (which lies somewhere in between). The courts were and are still today, hampered by centuriesold concepts of what can and cannot be patented. We are now firmly in the internet age. The internet has two elements: hardware (the switches that transmit information, microchips to process the data and screens to display the information) and software (the magic that breaks images into tiny ones and zeros to send across the planet in microseconds, connecting people and businesses in ways never before envisaged). The two elements are inextricably linked, yet one is patentable per se and the other is not. Given that just three companies are worth $2 trillion because of their clever software, it is clear that the world values innovative software products. Why is it that software is extremely difficult to protect under current patent law? Because the courts have been forced to restrict their decisions to the laws and legal precedents set down centuries before software was invented. Laws created at a time before machines, before computers and certainly before Facebook. It is my considered view that software should be patentable. If a software program is new and inventive (non-obvious) it is a commercially valuable, artificial state of affairs that should be the subject of letters patent. Isn’t it time that we reward innovative software engineers with the protection of the patent system? I’m not the only one who thinks this. Gary Smith, former head of the office of the PCT at the World IP Organization and former head of the PCT Division at the US Patent and Trademark Office, says: “Examining software-related patent applications is challenging for IP offices.” “It’s a complicated dance in which the applicants try to frame their software inventions in terms of controlling/implementing hardware and examiners have to determine whether the claim is only drawn the “ordinary computer hardware” or that it’s really a pure software invention.” “Each court decision that comes out adds additional complexity as to where to draw the line. Clearly defining

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what types of software is patentable would enable examiner’s around the world to determine what claimed inventions are patentable and provide greater certainty for innovative companies.” What would it take to make software patentable? Just three more words in the US and four fewer words in Europe. In order to make software patentable in the US and Europe I propose the following legislative amendments: US: Title 35 of the US Code Section 101 Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, including computer software, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title. Europe: European Patent Convention Article 52 1. European patents shall be granted for any inventions, in all fields of technology, provided that they are new, involve an inventive step and are susceptible of industrial application. 2. The following in particular shall not be regarded as inventions within the meaning of paragraph 1: a. discoveries, scientific theories and mathematical methods; b. aesthetic creations; c. schemes, rules and methods for performing mental acts, playing games or doing business, and programs for computers; d. presentations of information. I acknowledge that there are some who may argue that software should not be patentable. Most of the arguments I have seen are founded on the premise that making software patentable would stop people continuing to use software they have been using for ages. That argument ignores the fact that all jurisdictions require patentable subject matter to be both new and non-obvious. This debate is about whether software can be patented at all. That initial subject matter hurdle, once overcome, is just the first of three. The applicant still must show that no one has written software like theirs before, and that the differences between their software and previous software would not have www.ippromagazine.com 22

Justin Simpson · Opinion been obviousness to a computer programmer of ordinary skill. The existence of novelty and obviousness requirements serve to overcome this objection. Other arguments stem from those who believe that all software should be open source and free. Having employed over 30 computer programmers in my time I can tell you that they are not free. The good ones are paid very well. If software isn’t patentable, and cannot be protected adequately by copyright, why should any company pay hundreds of thousands of dollars to write a program that their competitors can copy at minimal cost without consequence? Why invest the time and money to create something that can simply be taken. It’s much cheaper to copy the next guy than to come up with something yourself.

market their term should be extended to 25 years. I think that’s a fair situation. For those who oppose the patentability of software on the basis that it stifles innovation, a possible compromise might be to have a shorter term for software patents. Software can be built and launched relatively quickly (compared, say to pharmaceutical products). Software also has a fairly limited shelf life. Many jurisdictions have two types of patents—a standard patent with 20 years and a 10 year patent for simpler inventions. In China and Japan they are called utility models. In Australia they are called innovation patents. They have a 10-year term and a maximum of five claims.

Their disclosure serves as education to the next generation of inventors who can then stand on the shoulders of those who’ve gone before to advance the technology further.

While I would like to see software patents on equal footing with other technology, I can see the commercial argument for a patent with a shorter term than 20 years. Such a proposal might win broader appeal and increase the speed of innovation. The innovators would have the incentive to disclose their software inventions, since a monopoly (if their invention was new and inventive) would be assured. That disclosure would then help the next wave of developers to extend their knowledge and make use of the technology once the 10-year patent term expired.

The quid pro quo for this educative contribution is the exclusive right to make or use the invention for the patent term. The term of a standard patent is 20 years. Pharmaceutical companies argued that it takes so long to bring a drug to

Courts have been trying to push the square peg of software into the round hole of 1600’s law for far too long. It’s time to recognise that software inventions have value and should be protectable under a new type of patent: the software patent.

The one argument that I believe does have some merit surrounds the anti-competitiveness of monopolies such as patents. The whole point of patents is an exchange of value— inventors disclose how their inventions work in return for a monopoly over their invention for a certain period.

Justin Simpson is an Australian Patent Attorney and serial entrepreneur. He is listed as an inventor on more than 50 patents and patent applications. His latest venture, Billtrader, helps IP firms get paid faster and eliminate international bank fees when paying or being paid by their IP colleagues around the world Justin Simpson CEO Billtrader

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Leading the International Trademark Association

INTA president David Lossignol gives an insight into the aims for his presidency at the association and hints at how he plans to beat Tish Berardâ&#x20AC;&#x2122;s entrance at last yearâ&#x20AC;&#x2122;s INTA Annual Conference

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INTA President · Interview What is the future of INTA in 2019? In 2019 we’ll continue to deliver on the implementation of our 2018-2021 strategic plan. We will provide highly relevant Ben Wodecki educational programmes across reports around the world through various meetings, conferences and other channels. We’ll continue to fight counterfeiting globally. We’ll support brand owners and also consumer interests online and look closely at the different brand restrictions. In Europe, we’ll be talking about Brexit and making sure the brand owners and the practitioners are informed about this very uncertain situation. Every year, we launch a new presidential task force. In 2019, INTA will implement recommendations from the 2018 presidential task force focused on small- and medium-sized enterprises (SMEs) and entrepreneurs. We’ll also have a report from our special task force looking at brand value. On this front we’ll be looking for help from a lot of our members as this is something that will involve a high level of collaboration. I also set up a presidential task force for 2019 focused on brands for a better society. This year INTA will also publish various studies, including one study on Generation Z and insights into how the younger generations are consuming brands.

Under your stewardship, what do you hope to change at INTA? I think that INTA is very efficient and constantly adapting, there’s not much change that I would anticipate strictly speaking, but it is true that on some matters we may wish to approach from a slightly different angle and not just focus on the legal side. Some of the studies that we have done and are doing are really business oriented and focus on business impacts as well as the legal side of course. When we discuss issues pertinent to our members, we always keep in mind business impacts.

Boston, Massachusetts, USA

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In the same way, we really want to exercise the positive side of brands. I think the idea is not so much changing things at INTA, but changing the mindset of some portion of the public to reduce the anti-IP sentiment and the perception that IP exists to prevent innovation and access to products or access to new technologies. In fact, it should be completely the opposite and focus on how IP is enabling innovation contrary www.ippromagazine.com 25

Interview · INTA President to what a portion of the public perceives. In terms of change, I would like the INTA community to think and act as one when it comes to specific topics such as on IP-sentiments or the fight against counterfeits—maybe insist giving more on preventing the demand through targeted education rather than focusing solely on cutting the supply.

How is INTA dealing with new and emerging technologies in 2019? We have a number of committees looking into new and emerging technologies and how they can impact the IP system. This is something we do all the time. This year we’ll be working closely with IP officers to provide a platform for them to brainstorm the impact of such technologies in the long term. We will also be applying the new technologies to ourselves because at INTA we are undergoing a complete digital transformation this year.

The event will give attendees a lot of opportunities to network. I recommend that everyone attend the opening ceremony as we will be announcing a few initiatives for which we would like to see the entire INTA community participate in. The educational programme looks amazing with broad appeal for all types of attendees. It includes a lot of leadershiporiented sessions in the educational programme, which are proving increasingly popular among our members.

Will you be making a similar entrance to previous president Tish Berard? Aha! This is a surprise! That’s why the community needs to come together for the opening ceremony. We’re trying to have something that’ll be interesting for everyone–I’m not sure I’ll be able to equal Tish’s performance but I will do something which is more of my own skills.

Next year the aim is to better serve our members and maximise the tremendous work that is done by all the volunteers and by the INTA staff members. We’re also looking at how we utilise new technologies to better serve of members. For example, at the end of last year we launched is our firstever podcast series, Brand & New.

Are you looking forward to working with such a diverse and vastly experienced set of new board members?

What can attendees expect from the annual meeting this year?

Every three years we have a new bunch of freshly qualified members and I am really looking forward to working with them.

With over 4,500 registering to attend on the first day–a record number–we expect record attendance.

I have already worked with some of them, one of whom is a co-chair on my presidential task force. It is really exciting.

Absolutely. I am really excited to have such a diverse board. At INTA we have been praised both by the board and outside about how diverse we are.

Next year the aim is to better serve our members and maximise the tremendous work that is done by all the volunteers and by the INTA staff members

David Lossignol President INTA

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Intellectual Property in an Innovative World

Designerâ&#x20AC;&#x2122;s dilemma / Pirates paradise DPS Parmar of LexOrbis talks about the coverage of industrial designs in India

Industrial Designs · Feature Creative designing is problem solving. It is a decisionmaking process in engineering which is directed towards fulfilment of everyday human needs. The term Industrial design was coined by New Zealander Joseph Sinel who recognised the need for apt definition in 1919 to capture how technology and art came together to create designs for life. The impact of the innovative and creative designers was such that the owning of designer products was treated with as pride possessions by elites to reflect their luxurious life style. The term ‘Populuxe’ (combination of popular and luxury) was coined by Thomas Hine to express the consumer culture which became an aesthetic, popular buzzword during 1950-1960 in the US. Accordingly the official definition of industrial design in the US reflects it as “the professional service of creating and developing concepts and specifications that optimise the function, value and appearance of products and systems for the mutual benefit of both user and manufacturer”. Industrial design is now an integral part of a products journey from mind to market. Credit for such transformation in product engineering process goes to Sinel, who had the edge perspicacity to carve the differential role for the industrial designs to competitive products. An industrial designer’s job, in the words of Sinel, is to ensure that an object was, ‘right in your eye and in your eye right’. Undoubtedly, lifestyle products reflect the personality of a person. The products research in these luxury products primarily tuned to the unique appearance or theme of such products. Imitation market basically target to copy such products and flourish in every country. Lookalike or ‘knock offs’ always find the best buyers when it comes to buying the look alikes’ of the luxury products. Visual designs of the objects are not purely for elite consumption. It finds its application in daily used products such jewellery, footwear, glasses, furniture, mobile phones, perfume bottles/containers and other innumerable articles. Even when industrial designs have such an overwhelming impact on the consumer products it is most underrated and sparingly used form of the industrial property as compared to its big brother like patents and trademarks. It is the oldest and most perplexing hybrid subject matter in the arenas of IP system.

Origin of design protection and its growth Interestingly designs protection finds its roots in the US which date back to the first design patent for fonts taken by George Bruce in 1842 in US. Surprisingly, the US Statue of Liberty was protected by a design patent obtained

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by Frédéric Auguste Bartholdi in February 1879. This design right covered the sale replica/copies of the statute. Interestingly, proceeds from sales of replicas helped to raise fund required to build the full statute. US design patents are very popular and every year more than 30,000 new application are received by the US Patent and Trademark Office (USPTO). Comparatively speaking, in India though the design registration remained in the statute book since passing of the first legislation, the Patterns and Designs Protection Act in 1872, but the growth of design applications remained very slow. In fact even with change of the design law in 2,000 number design applications per year has not crossed 12,000 mark. Even when the process for registration of design has been made simple, easy and fast, the use of design IP protection never became as popular amongst the designers in India as desired. It is well debated that designs life span is very short and the designers are very quick to move on to new design and they find it unnecessary to own design IP for a short life product. Some designers believe that even the unregistered designs can be protected under common law for passing off action and some finds registration of trademark as better option.

Coverage under design IP Design in statutory provisions for registration is generally understood as the way in which an article appeals to an eye. The design for an article includes its surface ornamentation as an ornamental design or the configuration of the goods of manufacture. In few jurisdictions even computer icons and Graphical User Interfaces (GUI) are recent examples of virtual objects that are covered by design patents. However, the universal exception to design registration remained the functionality or functional features of the product on which design is applied.

Registered designs versus unregistered designs It is well known that garment designers normally do not look for design IP rights as they normally change their garment designs every six months. The normal designs registration according to their belief is meant for ornamental or decorative patterns or the appealing shape of a product and its packaging. Such designs are protected by registration as large scale copies of these products are intended for consumers. For example registration of mobile phone designs is very popular amongst the mobile companies. In some www.ippromagazine.com 29

jurisdictions like UK the owners of unregistered designs of any aspect of the shape or configuration (whether internal or external) of the whole or part of an article are entitled to own a design right automatically if such a design is original and non-commonplace design.

laser cutting, 3D knitting, and 3D printing piracy has made substantial ripples in the fashion sector. This intensifies the piracy impact to such an extent that at times replicas hit the market even before they are showcased and released by their original creators.

Under §213(2) Copyright Designs & Patent Act 1988 (CDPA) under provides by implication that unregistered design right (UDR) subsists automatically when either the 3D object is created or design plans for that 3D object are produced as by definition designs means ‘any aspect of the shape or configuration (whether internal or external) of the whole or part of an article’.

At times fashion designers remain moot spectators to such a rampant copying perhaps in the hope that market saturation will come to their rescue. Even this is seen as a motivational force to keep them busy in changing their fashion trends faster to stay ahead in competition. Little these designers realise that such a rampant piracy impinge upon and shrink their profits.

The unregistered design however gets protection from being copied for a limited period of times. However, with deletion of words “any aspect” by the IP Act 2014 the scope and extent of UK UDRs has been restricted.

Another prominent form of piracy which is prevalent within fast fashion companies is to make the popular designer and haute couture styles accessible to the masses at throwaway prices. In the fashion design industry there is firm believe that fashion goods are imperfect substitutes and this imperfect substitution supports their claim that piracy may increase demand for the originals and develop consumption habits by increasing the popularity and dissemination of their design.

It will take some more time in UK to finally understand the exact implications such changes but in Indian design law such unregistered rights are not available even by implication. Interestingly, copyright in design also loses when it is applied to an article 50 times as per provisions of §15(2) in the Copyright Act, 1957 where it clearly stated that ‘copyright in any design, which is capable of being registered under the Designs Act, but which has not been so registered, shall cease as soon as any article to which the design has been applied has been reproduced more than fifty times by an industrial process by the owner of the copyright, or, with his licence, by any other person. Thus designer’s products which are capable of being registered under designs law which are holding copyright would cease to enjoy copyright in design if such designs have been applied to the articles which are produced more than 50 times. Therefore, the unregistered designs with copyright protection will not get protection if they are applied to 3D articles in India and replicated 50 times.

Fashion designers dilemma and piracy Fashion designers products are symbol of urban sophistication. Designer’s bridal gowns or signature dress for red carpet or ramp walk or catwalk wears of celebrities or urban elite becomes instantly popular. In no time look alike or ‘knock offs’ of such luxury products hit the piracy jolt. In the era of the digital tools with advanced means to recreate their creative works can be recreated almost instantaneously. With advance tools of production such as

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While the number of designers and brands that engage with these developing technologies remains small yet substantial amount of profits is lost by original designers. In order to check the design piracy some designers like Sabyasachi are looking for design registration as the fashion word strategy to compete and prevent copying of their creative designs. In year 2017 Sabyasachi design applications (387) top the list of design application filer in Indian Design office.

Designs infringement: damage awards Of late interest in mobile design IP protection has shown upward trends in view of recent high-profile cases worldwide where courts were harsh in punishing the infringers. The design infringement Apple v Samsung case verdict on award of damages $533 Million for infringement of Apple’s design patents on smartphone D618,677, D593,08 and D604,305 proves that designs IP is no longer a weak subject of IP. This seven year old design infringement battle verdict on damages has proved that infringement of designs patents can be taxing. This high profile US case will turn around the importance of designs from an obscure right to a powerful strategic IP tool to nail down the infringer with favourable results in form of high damages and stay ahead in competition. It will not be surprising to witness growth in design registration as repercussions of this verdict in US or other jurisdictions. www.ippromagazine.com 30

Industrial Designs · Feature Passing off road block: India In India, another development relating to the design law is equally important as long standing myth of protection of unregistered design suffered a jolt. Statutory protection for designs in India is available under the Designs Act, 2000. This registration procedure is akin to patent grant procedure as novelty is the main criteria of grant. Unlike UK, Indian law does not recognise statutory rights in unregistered designs. But this may raise the issue of the availability of common law remedy such as passing off in unregistered designs. Whether a passing of action based on misrepresentation or deceit in the context of an unregistered design or existing or expired design would find favour with the Indian courts or not can be predicted from the cases decided so far relating to this. For example in Tobu Enterprises Pvt v Megha Enterprises and Anr, the Delhi High Court categorically stated that the statutory remedy for design infringement had the effect of excluding the common law remedy. Contrary view was taken by the court in Smithkline Beecham Consumer Healthcare GMBH and Ors v GD Rathore and Ors, wherein court reasoned that exclusion of a passing claim would allow unscrupulous manufacturers to deceive customers by passing off their products as those of a registered design owner. Accordingly, the court held that infringement and passing off being two distinct remedies, there is no bar to invoking both. The court agreed to the contention that the plaintiff had established that the bottle shape in question had acquired a reputation and goodwill worth protecting. In order to settle this controversy a three-judge bench of Delhi High Court in Micolube India Limited v Rakesh Kumar Trading as Saurabh Industries & Ors again considered this issue in detail. The majority decision settled it in favour of holder of a registered design to uphold the fundamental principle that in order to institute a suit the right does not need to be rooted in a statute and thus paving the way for holder of registered designs to institute an action for passing off as common law remedy. This decision put to rest the controversy relating to overlapping of remedies but left the question of rights of the unregistered design holders untouched. In this aspect the dissenting opinion of justice Manmohan Singh is worthy of being noted in future cases wherein he expressed his reservation that due to the distinct nature of the two rights, the legislature did not intend to extend the monopoly granted under the Designs Act by allowing a remedy of passing off after the expiration of the design registration. If it is done it would give the manufacturer undue advantage and lead to overprotection of the design.

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I have already discussed this aspect in great detail while arriving at the finding that the very nature of the design right is such which is statutory in nature and provides a protection for the limited period of time. The common law right or action in deceit in common law in relation such novel shapes which are subject matter of design protection thus cannot be given protection in addition to the statutory right conferred by the Design Act as the same would be undermining the legislative intention and policy for which the design right was conferred upon registrant. Justice Manmohan Singh opinion in relation to unregistered design right subtly hinted its impact on unregistered designs. This is due to the reason that the very existence of the unregistered right in common law would make the statutory grant of design right meaningless or redundant. Giving apt reasoning justice Manmohan Singh concluded: “Once the nature and characteristic of the monopoly is such that it is a true monopoly based on statutory right akin to patent, it is inconceivable as to how there can be any monopoly be available under the common law which can exists besides the registered design right itself as the same would again mean that without disclosing the date of novelty, claim and scope of the monopoly in the design application, any person can claim anything in relation to the shape of the article in common law as a design right without any need to register the same and disclosing the authority about the newness in the shape.” His observations on its effect on expiration of right that “such exposition of the law wherein the designs are protected in common law in addition to the statutory right would defeat the existence of the statutory right itself”. “Additionally, the said common law right of passing off if allowed to be given to the proprietor of the registered design while enforcing his design right would also come in the way of expiration of the monopoly of design right as the said right would never expire and continue to exist in common law.” This is particularly relevant in context of designs where the statutory term of registered design gets over or in cases where the designs are not renewed. Although it was not stated in context of unregistered designs but it may probably seal the fate of availability of passing off as common law remedy for unregistered designs. www.ippromagazine.com 31

Feature Âˇ Industrial Designs Conclusion The registration of designs is slowly gaining importance in India as the number of applications are showing upward trend but it still remained as a less preferred low profile IP protection. Most of the designers shy away from taking registration route to protect their designs. It must be kept in mind that unregistered designs are not protected in India. Even the attempt to gain protection of unregistered design through a passing off action may fail if the recent cases are taken as precedence. In other jurisdictions like UK, the experience also showed that unregistered design rights are difficult to prove and suffer a shorter shelf lives stigma. To some businesses like the fashion industry, registered design right are not essential in view of the short life span of their products and the speed with which they develop new products. This belief is no more popular among the top designer as they are now active in the taking the registration route as necessary to stay competitive in fashion industry. According to them a registered design would not only act as a deterrent for pirates but also it is an easy right to sell or license to interested parties. It also gives them an opportunity to fully register their entire range of designs for the forthcoming events with comprehensive protection. With the courtâ&#x20AC;&#x2122;s ruling becoming stringent and harsh to the infringer and the quantum of damages soaring in design

infringement cases it is being projected in other jurisdiction like US and Canada that one can expect design IP to garner substantial interest in future. Though comparatively easy to obtain, designs registration is a kind of IP right that is sparsely used in India as compared to patents. As against 45,444 patent applications filed in India, merely 10,213 odd applications for design registration are filed in India in between 2016 and 2017. In the USPTO, on the other hand 39,097 design patent applications were filed in 2015. One thing that emerge from Indian scenario of design protection usages is that either the designers are not aware of it, or if they are aware they have reservation on its utility for designer products with short life. Arrival of designers like Sabyasachi in Indian design IP landscape as top filer would indeed trigger the fashion industry to make use of design IP to stymie piracy losses. Designers are critical of the system in place as they often expect intellectual property offices to make more information relating to design registration accessible to designers easily. With the system of e-filing of design application in place design applicants can now be file application online. It is expected that the search facility on the registered designs may also be made available to the public by IPO like patents and trademarks. Such steps with increase awareness drives by IPO would attract creative designers to make use of design registration route to realise full benefits of the design IP of their innovative designs which they in fact deserves.

Such steps with increased awareness drives by the IPO would attract creative designers to make use of design registration route to realise full benefits of the design IP of their innovative designs which they in fact deserves DPS Parmar Special counsel LexOrbis

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Blurred lines Sean Huang of Dykema discusses how the blurring boundaries of different technical fields are affecting patenting

The boundaries between different technical fields and/ or industries, especially those that traditionally appeared alienated from one another, are becoming blurred. Recently, a startup company, RoboSense, demonstrated a new solid-state LiDAR (Light Detection and Ranging) technology at CES 2019. LiDARs are remote sensing systems used in modern-day autonomous vehicles such as, Tesla, Waymo and Uber selfdriving cars, for making field measurements. RoboSense’s new RS-LiDAR-M1 supposedly reaches a 120° field of view (FOV) and, more importantly, may cut the production cost to $200 per unit, compared to laser-based electromechanical LiDARs costing several thousand dollars. The basic technology behind solid-state LiDARs is a phased array. A solid-state LiDAR utilises a number of optical transmitters to send out bursts of photons in specific patterns and phases to form a composite beam. The beam is then reflected by a remote object and captured by receivers to create a view of the object. By controlling the patterns and phases, the direction of the formed beam can be steered, and the size can be adjusted. A similar beamforming technology can also be found in telecommunications, for example in LTE networks. There, the technology employs an array of antennas to transmit radio waves. By controlling the phases and magnitudes of the individual signals, the radio waves experience constructive interference at one angle and destructive interference at another. As a result, the strength of cellular signals is enhanced at one specific direction, for example towards users at edges of a cell. This is essentially equivalent to creating a directional beam. Apparently, both of these two beam forming technologies are based on phased arrays, except that one employs optical emission, and the other operates with radio waves.

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The list does not stop there. Beamforming is even applied in wireless power transfer (WPT). WPT is a method for contactlessly transmitting electric power over distance. Today, WPT is adopted for charging consumer electronics and electric vehicles. One WPT approach is to transfer power from primary coil(s) to secondary coil(s) via magnetic resonant coupling. With beam forming, WPT can deploy a phased array of multiple primary coils to induce magnetic fields. The array is controlled such that the magnetic fields are combined and enhanced towards the secondary coil(s) to augment the WPT performance. Again, the beam forming in WPT uses phased array but focuses on magnetic fields. Similar examples can be found across many other fields and/or industries. For instance, the automobile makers are leveraging concepts from consumer electronics and telecommunications to make vehicles more intelligent and entertainment friendly. The oil and gas industry is adopting the internet of things and cloud computing to digitise and manage assets. The list can go on and on. But what is more important, from a legal perspective, is that this trend could cause non-negligible impacts on patent practice. For example, one fundamental requirement of patent prosecution is to prove that the subject matter in the patent claim(s) is novel and nonobvious in view of the “prior art” cited by a patent examiner. The determination of what the cited art does or does not teach and/or whether they can obviously be combined against the claim(s) is further made from the standpoint of a person having ordinary skill in the art (PHOSITA), a fictional person considered to have www.ippromagazine.com 34

Sean Huang · Opinion

the normal skills and knowledge in the technical field at issue. In practice, the prosecution typically involves making arguments and claim amendments to differentiate the claimed invention from the cited art. A patent practitioner having broader knowledge of the technology and relative applications will likely have a more accurate perception as to the scope of prior art search and use of cited art. This may optimise the pre-screening at the beginning and prosecution at examination of the application and accordingly improve the quality of the procured patent. Similarly, post-grant proceedings and litigation also involve the search for the most relevant prior art and definition of a PHOSITA. As the disciplinary delimitation becomes fuzzy,

skills and knowledge that were not considered ‘related’ may now be included when determining the characteristics of a PHOSITA and evidence that used to be irrelevant may now be legitimately categorised as pertinent prior art. All of this will likely raise uncertainty as well as opportunities for both sides to consider when coming up with their strategies and arguments. With today’s quick transfer of information, it is now more often than ever discovering one technology being applied in multiple areas. Patent practitioners need to recognise the new challenges and the concomitant requirements they bring when counseling their clients.

All of this will likely raise uncertainty as well as opportunities for both sides to consider when coming up with their strategies and arguments

Xianghui (Sean) Huang Associate Dykema

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Brexit: the uncertain storm With utmost uncertainty, the UK faces the Brexit cliff-edge with the determination of a group of lemmings, but for intellectual property, the end is not yet nigh

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Brexit Update · Feature

By Barney Dixon and Ben Wodecki

The creeping tendrils of an uncertain Brexit have worked their way into every fibre of the UK’s industries, suffocating any modicum of progress as businesses find themselves to scared to face the uncertainty with open arms.

At the time of writing, Theresa May’s Brexit withdrawal agreement—which contained several provisions protecting the UK’s intellectual property industries, including the job security of trademark attorneys—has been voted down and any alternative, bar a no-deal Brexit, seems unlikely. Conference sessions around the globe have warned the potential impact of Brexit and as uncertainty persists, so does fear. British firms have demanded clarity and asked the government to provide answers to 20 crucial questions, before the 29 March deadline. Regardless of a deal, existing EU trademarks will be transformed into a comparable UK right, but while this guarantee has been claimed by the UK, a question still hangs over whether UK trademark attorneys will continue to have rights of representation at the EU IP Office. One of the UK’s largest law firms, Mewburn Ellis, said it will manage the conversion process of rights holders’ pending EU trademark applications into UK equivalents for free post-Brexit. But, even with law firms stepping in to help, cost is becoming a bigger concern for businesses that may be forced spend more when the UK leaves the EU. According to Clarivate Analytics, UK trademark filing volume has increased by 43 percent since the Brexit referendum was held, while, conversely, EU trademark filing volume by UK applicants has decreased by 13 percent since the referendum. This highlights that rights holders are attempting to gain protection, which will be transferred to an EU right. Even recent victories for the UK, such as its podium position in the US Chamber of Commerce Global Innovation Policy Center’s 2019 International IP Index, have come with a warning that Brexit could impact the UK’s national IP environment and existing EU laws and standards.

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Feature · Brexit Update Positives and negatives According to Mewburn Ellis associate, Rebecca AndersonSmith, there are deep concerns about the impacts of Brexit on the trademark profession. She explains that colleagues voiced their concerns when the referendum results were announced while she attending the 2016 European Communities Trade Mark Association conference in Dubrovnik, Croatia. Like everything else when it comes to Brexit, the future for UK trademark attorneys is uncertain, but despite this, AndersonSmith remains optimistic that UK attorneys will remain “an integral part of the European and global trademark spheres in years to come”. “The UK will always be an important market for many businesses and therefore I anticipate seeing an increase in UK trademark prosecution and opposition work after Brexit. While the nature of my work will undoubtedly change postBrexit, I am confident that it will continue to be as varied, interesting and challenging as it has always been and that the strong relationships between UK attorneys and other practitioners across the world will endure. Brexit almost certainly result in an increase in UK trademark prosecution and

opposition work, both initially with the conversion of existing EU trademarks into equivalent UK rights, and longer term as individuals and companies seek to protect their marks in the UK by filing national UK trademarks”. This sentiment is shared among those in the IP sphere and others assess the UK as remaining a significant commercial market post-Brexit. Robert Reading, director of custom and managed solutions at CompuMark, argues that non-EU trademark applicants will be filing UK trademark applications “in large volumes” and he suggests that UK attorneys strengthen ties with “traditionally weak markets”. Reading shows that UK trademark filing volume from the US has increased by over 400 percent since the UK voted to leave, with US brand owners “doubling up” by filing duplicate UK and EU trademark applications. On top of this, the UK has already signed post-Brexit rights agreements (including IP rights) with non-EU countries like Iceland, Switzerland, and Norway. To put it simply, no one yet knows what the future holds for UK IP and as the UK Government continues to wrestle with itself, it will be down to those in the industry to pick up the pieces and move forward, post-Brexit.

23 June 2016 - UK votes to leave the EU 11 January 2017 - Jo Johnson appointed UK IP minister 29 March 2017 - UK Government triggers Article 50 following parliamentary approval 9 January 2018 - Sam Gyimah replaces UK IP minister 26 June 2018 - Royal assent given to EU (Withdrawal) Act 14 November 2018 - Draft withdrawal agreement agreed 1 December 2018 - Sam Gyimah resigns from cabinet over Brexit deal 5 December 2018 - Chris Skidmore named new IP minister 15 January 2019 - UK parliament rejects EU Withdrawal Agreement following vote 16 January 2019 - Theresa May survives no-confidence vote 29 March 2019 - UK due to leave the EU

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View from the industry How is the UK’s intellectual property industry dealing with Brexit? Chartered Institute of Trade Mark Attorneys With Brexit uncertainty persisting and the UK Government’s deal voted down, what is CITMA’s biggest concern when it comes to Brexit? CITMA wants to make sure there is clear communication to rights holders of the steps they should take after Brexit. We are very keen to ensure that applicants for EU Trademarks know that whether there is a no-deal or a withdrawal agreement they will need to apply in the UK for a ‘comparable’ UK right within nine months of Brexit to ensure they obtain equivalent protection in the UK. CITMA maintains detailed information about Brexit.

Whether there is a no-deal or a withdrawal agreement applicants will need to apply in the UK for a ‘comparable’ UK right within nine months Tania Clark President CITMA

Chartered Institute of Patent Attorneys What are the main concerns for patent attorneys in the event of a no-deal Brexit?

certainty about what that environment will be like, now and in the future.

I would say that our main concern is the effect on the general business environment in the UK and the EU. Our clients may well to have to deal with a confusing and turbulent period in which their business focus is likely to be distracted from research and development and protecting the resultant IP. If simply trading becomes challenging for them, patent protection is likely to take second place.

There is a real challenge for business planning in the absence of certainty.

In terms of our own businesses, there may be fewer immediate problems. The European Patent system is independent of the EU, so British European Patent Attorneys can continue to represent their clients at the European Patent Office in just the same way. Many British firms have attorneys from other EU countries and their position will need to be secured. Many firms also have offices in other EU countries and there might be an increased management burden post-Brexit.

What would be the difference between a deal and nodeal for those in the patent profession? The big difference would be the ability to transition gracefully to a new commercial environment in Europe, with some

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How is Brexit affecting relationships with clients? Are we seeing a move to services based more in Europe? Despite our best efforts, some international clients haven’t yet really understood that the status of European Patent Attorneys will be unaffected by Brexit. This has unsettled some clients needlessly and we’ve had to reassure them that their chosen attorneys will continue to represent them seamlessly regardless of the outcome of Brexit. Some patent firms have enhanced their offering in continental Europe, opening or growing offices, but for many this has been part of a trend that started long before the Brexit vote, as firms grow and the European Patent Attorney market tends to consolidate with larger firms. Matt Dixon Chair of the business practice committee CIPA www.ippromagazine.com 40

Brexit Views · Feature

UK Intellectual Property Office With the withdrawal agreement voted down in parliament and its future uncertain, what is the IPO doing to guarantee continuity post-Brexit? Delivering the deal negotiated with the EU remains the government’s top priority. Nevertheless, the government continues to do the responsible thing and prepare for all eventualities, including leaving the EU with no deal. We are bringing forward legislation to ensure that the IP system continues to function should we leave the EU with no-deal. In addition, and to help producers and users of IP to plan ahead, the government has published a series of technical notices that offer guidance for continued planning in the event of no deal. These cover trademarks and designs, patents, copyright and exhaustion. We intend to follow these up with more detailed business guidance where relevant in the coming weeks. Importantly, the notices confirm the Government’s commitment to continuity of EU IP rights in the UK and that no rights will be lost as a result of the UK leaving the EU.

How does the IPO plan to work with the EUIPO post-Brexit? Our future relationship with the EU IP Office (EUIPO) will be a matter for detailed negotiations on the future partnership with the EU. However, we value the excellent relationship the UK IP Office (UKIPO) has built with the EUIPO over the past 25 years. As active members in European Cooperation Projects we currently have five UKIPO staff seconded as National Experts to the EUIPO, working in Alicante and sharing their experience and IP knowledge. Continuing our strong relationship with the EUIPO is high on our agenda. We remain committed to future engagement following our departure from the EU, and see benefits in continuing this relationship in some form.

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Are there any positives that stem from the UK leaving the EU from a rights owner’s point of view? The key message for your readers is that no IP rights will be lost as a result of the UK leaving the EU. UK rights holders will still be able to protect their IP in the EU via the EU Trade Marks and Registered Community Designs system. The UK remains a member of the Madrid system for international trademarks and the Hague system for international designs. These systems allow UK businesses to register their IP in multiple territories, including the EU, through one application. The UK will continue to have one of the best IP regimes in the world. We will continue to deliver quality rights granting services, lead on IP enforcement and engage in international IP discussions.

The UK recently signed post-Brexit rights agreements with non-EU countries like Iceland, Switzerland, and Norway. IP rights were included. Will this have any significant impact on filings? The agreement with the non-EU EEA EFTA states and Switzerland extends some of the provisions of the EU Withdrawal Agreement to the EEA EFTA states and Switzerland where they are relevant. For IP this includes geographical indications, the continued protection of databases and arrangements for goods where the IP rights have been exhausted at the point the UK leaves the EU. The extension of these provisions to the EEA EFTA states will ensure a smooth transition for those states, as the UK leaves the EU. The agreement does not extend any of the provisions in the draft withdrawal agreement covering EU Trade Marks and Registered Community Designs as these rights only cover the territory of the EU. Rights holders in the EEA EFTA states and Switzerland who hold an EU trade mark will benefit from the conversion of those rights to UK rights. Adam Williams, Director of international policy UK Intellectual Property Office www.ippromagazine.com

Feature Âˇ Brexit Views EU trademark applications filed by UK applicants

4,686

4,703

5,015 4,393

EUTM filing volume by UK applicants has decreased by H1

41,669

42,329

UK trademark applications

36,276 29,637

38,763

13%

32,019

UKTM filing volume has increased by H1

UK trademark applications and EU trademark applications from the UK

35,069

36,663

40,962

43,466

46,684

43%

46,722

COMBINED filing volume has increased by H1

Statistics courtesy of CompuMark, Clarivate Analytics

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33%

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