IPPro Issue 20

Issue 20

Conference Special

INTA’s stalwart CEO

Etienne Sanz de Acedo discusses the association’s shared achievement

Amazon’s Project Zero analysed

A spanner in the works for video games?

Words from the IACC

Don’t miss the obvious...

Ê Ê

Ê

...or the obscure Ê Ê

Ê

Identify potential partners and licensing opportunities Monitor market trends and key competitors Avoid infringement and parallel development with Minesoft’s web-based patent solutions

analyticsV2 Visit www.minesoft.com today to keep your business on track

global patent solutions

In this issue

p14

INTA CEO

p42

Moving Marks

An interview with INTA’s stalwart CEO, Etienne Sanz de Acedo

One European trademark application still under review could cause havoc to the video game industry

Major Trademark Updates

The Grey Market

Editor: Barney Dixon barneydixon@blackknightmedialtd.com +44 (0)203 750 6026 Reporter: Ben Wodecki benwodecki@blackknightmedialtd.com +44 (0)203 750 6017 Designer: James Hickman

A round-up of some of this year’s biggest trademark news

Jan-Maarten Laruijssen of PointerBP takes a deep dive into the grey market

jameshickman@blackknightmedialtd.com +44 (0)203 750 6021

Account Manager: Bea Ipaye beaipaye@blackknightmedialtd.com +44 (0) 203 750 6025 Associate Publisher: John Savage johnsavage@blackknightmedialtd.com +44 (0)203 750 6021 Publisher: Justin Lawson justinlawson@blackknightmedialtd.com +44 (0)203 750 6028 Office Manager: Chelsea Bowles accounts@blackknightmedialtd.com Published by Black Knight Media Ltd Copyright © 2018 All rights reserved

p16

p4

Contributors: Becky Butcher

IACC Update

The IACC’s Bob Barchiesi provides an update on the association and its recent takedown of iOffer’s counterfeit marketplace

Project Zero

Amazon’s new Project Zero brand protection platform analysed

p22

p20

Neuschwanstein Trademark

HGF attorneys Jan R. Naefe and Julia Saladin analyse how the State of Bavaria has defended its EU Trademark for the term ‘Neuschwanstein’

p28

Brand Partnerships

As the smartphone wars seemingly come to a close, Nokia sits poised to take advantage of the new world it has created in brand licensing

p32

Subscribe now for free

www.ippromagazine.com www.ippromagazine.com

Major Trademark Updates Counterfeit products make up three percent of world trade A report from the Organisation for Economic Co-operation and Development and the EU Intellectual Property Office has revealed that counterfeit goods account for 3.3 percent of global trade. Figures from the report show that near seven percent of EU imported goods in 2016 were counterfeit or pirated products. The report notes that the US was the most affected by counterfeits, with a near quarter share of all counterfeits.

hkhtt hj/shutterstock.com

EUIPO suspends UK bar on registering EU marks UK trademark applications can continue to be filed in the EU following the Brexit extension to 31 October. UK filers may hold the ability to file in the EU beyond that date if a deal is secured. The UK also retains the option of leaving earlier.

Alexandros Michailidis/shutterstock.com

International trademark applications under Madrid see six percent increase Figures from the World Intellectual Property Organization revealed that the Madrid system saw more than 60,000 trademark applications in 2018, a 6.4 percent increase on the previous year. Applicants from the US filed the largest number of trademark applications using the Madrid system, with 8,825 filed.

Almost every country filing using the Madrid system saw growth in their number of filings, with only Australia and Austria filing less than in 2017.

Vladimir Sazonov/shutterstock.com

China to cut trademark review times The review time for Chinese trademarks will be reduced within five months, according to Gan Shaoning, deputy head of the Chinese National Intellectual Property Administration. He also emphasised that further IP protections would be strengthened, with the costs for infringements increasing.

HelloRF Zcool/shutterstock.com

4 IPPro

Major Trademark Updates WIPO launches free AI trademark search tool for brands WIPO has launched an artificial intelligence powered image search tool for brands. It can determine trademark image similarity by identifying shapes and colours in marks and utilises trademark data from the Madrid System, as well as from larger trademark offices.

silvabom/shutterstock.com

Trump signs memorandum on tackling illicit goods and piracy Reality star turned US president Donald Trump has signed a memorandum on combating trafficking in counterfeit and pirated goods, which states the US “must improve coordinated efforts within the Federal Government to address this challenge”. Within 210 days of the memorandum’s signing, a report on the state of counterfeit and pirated goods trafficking and recommendations will be published. It will provide data and extra information on the extent of counterfeits on online third-party marketplaces and will identify factors that contribute to trafficking illicit goods.

Evan El-Amin/shutterstock.com

Iancu v Brunetti A case concerning whether section 2(a) of the Lanham Act is facially invalid under the free speech clause of the first amendment has been heard in the US Supreme Court. A US-based designer had attempted to register the term ‘FUCT’ for a line of streetwear clothing, only to be denied. Brunetti’s legal team argued that brands like FCUK and FVCK had been granted trademarks. The justices appeared to focus on whether the statute should be narrower, and that a list of untrademarkable terms would be unconstitutional. No ruling has been passed at the time of writing. bakdc/shutterstock.com

Mission Product Holdings v Tempnology A case questioning whether a trustee’s rejection of a trademark licence agreement terminates the rights of the licensee that would survive the licensor’s breach under applicable nonbankruptcy law has been heard in the US Supreme Court. The Bankruptcy Code §365(a) gives trustees the authority to reject executory contracts. US Congress has previously considered but declined to adopt an exception for trademark licenses. The justices focussed questioning on exclusive distribution rights and how Mission Product was actually injured.

Erik Cox Photography/shutterstock.com

www.ippromagazine.com

News Round-Up

INTA and COMEDUC partner on teen anticounterfeiting awareness campaign The International Trademark Association (INTA) and National Trade Foundation for Education (COMEDUC) are to partner in an initiative to educate Chilean students about the importance of intellectual property.

Based in Santiago, the programme aims to inform over 3,000 students across 19 high schools in Chillán, Curicó, Rancagua, San Fernando, Santiago and Viña del Mar. It will officially commence with presentations conducted by Andrea Lobos and Rodrigo Sammut of Andes IP. This marks INTA’s first national initiative as part of its Unreal Campaign, originally launched in 2012 and designed to highlight the dangers of counterfeiting among teenagers.

José Luis Londoño, chief representative officer for Latin America and the Caribbean at INTA, commented: “We greatly appreciate that COMEDUC recognizes the value in educating the younger generation about the rising threat of counterfeiting worldwide.”

“Informing students about the dangers of purchasing fake goods and about the value of trademarks can help contribute to their own development as informed consumers as well as to the economic growth of Chile in the long run.”

COMEDUC’s educational subdirector, Tatiana Arce, added: “We are very happy that the partnership has prospered.”

“Implementing the Unreal Campaign means that we can add elements to the integral formation of our students; we will be delivering a training that is not only technical but also civic, and above all, human.”

6 IPPro

Jasni/shutterstock.com

In 2018 INTA contacted COMEDUC, a private non-profit provider of professional and technical education following its projections that the total global value of pirate and counterfeit goods would reach anywhere between $1.9 trillion and $2.8 trillion by 2022.

McDonald’s appeals Big Mac trademark revocation by EUIPO McDonald’s has filed an appeal against an EU Intellectual Property Office (EUIPO) revocation of its Big Mac trademark.

The trademark was revoked after Irish fast food chain, Supermacs, attempted to register the term Big Mac in classes 29, 30, and 42. McDonald’s opposed, but failed.

The EUIPO’s cancellation division ruled that McDonald’s had failed to “[prove] genuine use of the contested EU trademark for any of the goods and services for which it is registered” and revoked the mark.

Supermacs had argued that McDonald’s is engaged in “trademark bullying; registering brand names which are simply stored away in a war chest to use against future competitors”.

A McDonald’s spokesperson said they were confident that in the event of an appeal the decision would be overturned by the EUIPO Board of Appeals.

News Round-Up

LunaseeStudios/shutterstock.com

Stone Brewing denied preliminary junction v MillerCoors Stone Brewing’s attempt to get a preliminary injunction against MillerCoors in a trademark infringement case over the term ‘stone’ has been denied. The US District Court for the Southern District of California denied Stone’s motion, ruling that the brewing company had not shown a likelihood of suffering irreparable harm, despite finding its trademark infringement claim against Miller “moderately strong”.

Stone Brewing accused MillerCoors of trademark infringement in 2018, following the rebrand of MillerCoors’ Keystone product, which now prominently features the term ‘stone’ on its packaging.

Stone Brewing accused MillerCoors of running a “misguided campaign to steal the consumer loyalty and awesome reputation of Stone’s craft brews and iconic stone trademark”.

It said: “MillerCoors recently decided to rebrand its Colorado Rockies-themed “Keystone” beer as “STONE”— simultaneously abandoning Keystone’s own heritage and falsely associating itself with Stone’s well-known craft brews.”

MillerCoors hit back at Stone Brewing’s claims, denying the allegations and lambasting Stone’s “bombastic hyperbole” and “pugnacious attitude”.

MillerCoors added that the Stone brand is “well known in the beer industry for its bombastic hyperbole, pugnacious attitude, and for launching public insults at brewers small and large.

Stone Brewing even proudly markets itself as ‘Arrogant Bastard,’ and sells a whole line of beers under the ‘Arrogant Bastard’ name.”

“MillerCoors admits that Stone Brewing has obtained a federal trademark registration for the STONE trademark.

MillerCoors denies that Stone Brewing’s STONE trademark is incontestable as to MillerCoors.”

In the latest ruling, the district court also denied Stone’s request to dismiss MillerCoors’ counterclaims.

Brendan Palfreyman, a partner at Harris Beach and creator of trademarkyourbeer.com commented: “The most interesting aspect of the decision was that the court found that the ‘relatedness of the marks’ factor weighed in favour of MillerCoors but still concluded that Stone had a moderately strong case.”

“Where Stone lost the motion was on the showing of irreparable harm, which can be very difficult in this type of case.” www.ippromagazine.com

News Round-Up MLS opposes Inter Milan trademark Palm restaurant owners file for bankruptcy, accused of dodging damages Two grandsons of the original owners of the Palm Restaurant have filed for Chapter 11 bankruptcy after being ordered to pay $119 million following a trademark lawsuit over the restaurant’s name.

Walter Ganzi and Bruce Bozzi own an 80 percent stake in the company that owns the restaurant’s name, while cousins Gary Ganzi and Claire Breen own the remaining 20. The cousins had challenged a flat royalty rate set by the brothers 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 annulled all Palm restaurant licences as having been products of “a textbook example of fiduciary misconduct”.

Co-lead trial counsel for the cousins Ganzi and Breen, Fred Newman called the bankruptcy filing “an attempted end run around the precedentsetting $119 million judgment”.

Newman stated: “After a full trial, Justice Andrea Masley of New York’s Commercial Division found that defendants had engaged in a ‘textbook example of fiduciary misconduct’—bringing a long-overdue measure of justice to Ganzi’s family, who had been denied their rightful legacy for more than 40 years. While the judgment is not against any of the Palm Restaurant companies, Ganzi and Bozzi have forced the company that owns the Palm intellectual property and now holds the judgment, to file for Chapter 11 protection—an unusual filing by a debtor that holds a multimilliondollar judgment with virtually no liabilities. As such, it is a clear stunt to use US bankruptcy law to circumvent a valid New York judgment and established post-judgment procedures that require the posting of a bond to get a stay pending appeal and to avoid responsibility for paying the judgment.”

He concluded by emphasising his confidence that the Bankruptcy Court will “see through” the brothers alleged ruse.

A US trademark for the term Inter from Inter Milan has been opposed by Major League Soccer (MLS) over fears it would damage the name of David Beckham’s new American soccer team. Inter Milan had attempted to register the term Inter, but MLS opposed its application as the term is associated with various other football clubs around the globe. Examples shown by the league included Inter Leipzig from Germany’s fifth tier, NK Inter Zaprešić from Croatia’s Prva HNL (first tier), and S.C. Internacional from Brazil, who are commonly known as Inter. MLS argued that consumers don’t associate the term Inter with one team, and the examining attorney cited that the Inter application was a potential bar to the registration of Beckham’s team due to a likelihood of confusion. Beckham’s expansion team Club Internacional de Fútbol Miami, known as Inter Miami, is due to appear in MLS in 2020 along with two other expansion teams.

Some 24 teams now compete in the league, compared to the ten when it first launched in 1994. The now-retired Beckham previously played for Inter Milan’s biggest rivals, AC Milan. He also played in Major League Soccer (MLS) for LA Galaxy.

MLS filed its own application for Inter Miami’s name and logo on 24 September 2018.

J. Varbanov & Partners

European and Bulgarian Patent & Trademark Attorneys

One of the oldest and leading IP companies in Bulgaria Professional, cost effective services and quality advices

Areas of practice: *IP Protection *IP Enforcement *Anti-counterfeiting *Litigations *Domain name registrations *IP watches

PO Box 1152, BG-1000 Sofia, Bulgaria South Park Complex, bl.1A, 2nd fl., BG-1421, Sofia, Bulgaria Tel.: (+359 2) 986 51 25, Fax: (+359 2) 980 32 47, e-mail: jvp@jvpatents.com

www.jvpatents.com

8 IPPro

+33 (0) 1 84 17 45 32 contact@ipzen.com www.ipzen.com

Case Management Manage files online

Trademark Management

Track activities

Access your portfolios online

Attach documents

Automatically calculate deadlines

Share Information

Integrate trademark data easily

Integrated Invoicing Generate invoices directly from your files

Domain Name Management Manage your domain names online

Consolidate files into a invoice

Track deadlines

Track payments

Sort domain names by category Check availability online

Deadline Tracking View all deadlines in a snap Select people and delegate task

Watch Services Trademarks Domain names Social media

YOUR IP SOFTWARE SOLUTION IN THE CLOUD

News Round-Up Chloe Coscarelli files third trademark infringement lawsuit against former employers Chloe Coscarelli has filed a third lawsuit against her former business partners discounting allegations of trademark infringement.

pop-up restaurant does not infringe BCHG’s ‘by Chloe’ trademark.

The lawsuit claims the companies have “embarked on a vicious campaign to interfere with, disrupt, and outright stop Chloe’s growing success at all costs”.

Coscarelli filed lawsuits against ESquared Hospitality and BC Hospitality Group (BCHG) who she entered into a partnership with back in 2014.

Both chefs are seeking an award of attorney’s’ fees and costs and any further relief deemed proper by the court.

The companies allegedly used her image, name, recipes and even domain names without permission.

Coscarelli had previously sought permanent injunctions barring her former business partners from selling any food or beverages using the Chloe name.

She had announced a partnership with fellow chef Tom Colicchio which would see the opening of vegan pop-up restaurant ‘Supernatural.’

Shortly after, BCHG sent letters to both chefs asking them to cease the alleged trademark infringement.

www.ippromagazine.com

The pair opted to file a lawsuit in the US District Court for Southern District of New York seeking a ruling that the new

Protect your IP online .com.ar .ch .at .sg .com.br .ro .it .bike .com.au .co.nz and many more... .sk .hosting .ae .jp .brussels .si .lv .dk .gr .us .se .lawyer .ass .li .com ociates .cr .claims .safe .de .ie IPPro_FPA.indd 1

.fi .no .pl .bank .lt .company .cz .es .pt

Domain name specialist since 1999

k u . .be

.shop

.ru .hr

.net

10 IPPro

For brand owners & TM offices Excellent support

Every possible extension T: +44 20 3393 4858

27/11/2018 15:31

info@bNamed.net

www.bNamed.net

News Round-Up

Iceland loses EU trademark following government intervention

fototip/shutterstock.com

The supermarket chain Iceland has had its European trademark invalidated following a legal challenge from the Icelandic government. The supermarket had registered the term as a word mark in classes 7, 11, 16, 29, 30, 31, 32, and 35 covering various products including consumer electrical goods, food products, and beverages.

The Icelandic Ministry of Foreign Affairs challenged the supermarket’s trademark claiming it hinders companies in Iceland from trading using their country’s name.

Iceland isn’t a member of the EU, but is the fifth largest exporter of fish and fishery products to the EU after Norway, China, and Ecuador, representing 4 percent of EU fish and aquaculture imports.

A statement from the Icelandic government said it expects an appeal from the supermarket chain, but added that the ruling will “represent an important and new case law when it comes to registration of country names as trademarks”.

It described the supermarket’s claims that its trademark held acquired distinctiveness through use as “not hold[ing] very much water”.

Gudlaugur Thor Thordarson of Iceland’s Ministry of Foreign Affairs commented: “I rejoice this decision, even though it is not entirely surprising because it goes against common sense that a private company can claim the name of a sovereign state as its own, as happened in this particular case.

This decision sets a precedent, provided that it remains in force. This is, therefore, an incremental victory in a very significant case for Icelandic export companies. Our country is known for its purity and sustainability, and hence the reference to the origin of Icelandic goods has great value.”

The EU Intellectual Property Office (EUIPO) ruled that the supermarket chain pay the cancellation fee, as well as the Icelandic government’s costs.

The supermarket has until 5 June to appeal this decision to the EUIPO’s Boards of Appeal.

12 IPPro

CompuMark launches trademark tool for small businesses CompuMark has launched Trademark.com, a US only trademark protection tool for small business owners.

Trademark.com allows brands to monitor up to five marks at a time for copycat activity and to determine a trademark’s availability before filing an application.

The service is powered by CompuMark and aims to provide confidence to smaller businesses looking to obtain a trademark.

Mara Trumbour, executive product owner of Trademark.com, commented: “Trademark.com really helps small businesses protect the ownership of their brand while addressing risks that are oftentimes unseen.”

“If a trademark owner isn’t actively monitoring their trademark, another business can easily capitalise on their hard work to build a positive reputation. That’s where Trademark. com shines, so small business owners can catch potential copycats before it’s too late.”

CompuMark president Jeff Roy added: “Having personally experienced the heartbreak of infringement, I’ve become extremely passionate about helping today’s entrepreneurs claim their brand before someone else does.”

“This convenient, low-cost service tool was designed to help the small business owner who has put blood, sweat, and tears into building their brand save the additional time and effort that comes with owning and monitoring their trademarks.”

Etienne Sanz de Acedo • Interview

The shared achievement of the International Trademark Association Etienne Sanz de Acedo has been CEO of the International Trademark Association (INTA) for six years, presiding over some of the biggest changes in trademarks and intellectual property.

Now, as the association is expanding its mission away from being a purely trademark focused organisation to one that deals with the wider issues facing brands, Sanz de Acedo explains what’s next and how INTA plans to continue servicing its members with precision and excellence.

Barney Dixon & Ben Wodecki report

What have been some of your greatest accomplishments and proudest moments as CEO of INTA? Any of my achievements are not just my achievements, they are the achievements of the association. Staff, members, the board and myself, are truly a team and that is probably one of the most successful things about INTA. Over the past six years, we have been able to commit to significant and substantive internal expansion, as well as a significant geographical expansion.

In terms of substantive expansion, we’ve moved from purely trademarks into designs, copyright, data protection, data privacy, unfair competition, and right of publicity. We’ve been undertaking impact studies that demonstrate the value of IPintensive industries and that explore other issues and trends relevant for brand owners.

It’s not just about trademarks anymore. Companies don’t talk about trademarks; they talk about brands. That reflects pretty well on our strategic plan, where we talk about promoting trademarks and brands, we talk about enhancing consumer protection, and we talk about embracing innovation and change.

14 IPPro

In terms of the geographical expansion, we historically have been very strong in North America and Europe, but perhaps not as strong in other regions.

In the last few years, we have opened a representative office in Singapore for the Asia-Pacific region and in Santiago, Chile, for Latin America.

In addition, we are now looking into having a presence in Africa and the Middle East.

How has the association progressed since you began as CEO? What has changed?

The world is changing at a quicker pace than ever before.

At INTA we have been able to understand that, and we are trying as much as possible to remain at the service of our members and remain influential. In order to do that we need to permanently embrace change.

We need to think about ourselves as an evolving organisation and in terms of positioning; we see ourselves as facilitators of best practices. Our ultimate goal is very simple: to get better laws to protect brand owners and consumers.

Now, in practice, this is extremely complex and hard to achieve, but this is what we are aiming for.

Etienne Sanz de Acedo • Interview Why do you think a lot of IP associations including INTA are looking at restructuring and changing the inner workings of organisations?

I can’t speak for others, but at INTA, if we want to be in line with the changing times in our society, then we need to permanently monitor what is going on and we need to be ready to anticipate the future.

If we see that plain packaging and brand restrictions are no longer an emerging issue but a real problem for brand owners and consumers, then it might be time for INTA to have a fulltime committee dedicated to that.

One of the things that was very appealing to me when I joined INTA is that it is very well structured and the governance is very robust. We reinforce that, permanently nominating and repopulating the committees through the planning committee.

Everything we do is based on vision, strategy, implementation, and assessment.

How important is it for INTA to have such a diverse board?

Are there any plans to widen INTA’s scope moving into other things outside of the brand’s bubble?

We’re permanently having these kinds of discussions. I cannot anticipate what the decisions of the board will be. But the reality is that you cannot think about IP in terms of one legal tool. You need to have a more holistic approach. If companies and governments are taking a more holistic approach, then we need to have the same approach.

How can professionals overcome workloads increasing and budgets shrinking?

One of the things we are trying to do is enhance the skills of our members as individuals. Let’s face it, lawyers tend to be conservative—I’m saying that with a background as a lawyer myself. We all as human beings see change as disruptive.

But, like it or not, change is happening and the best thing we can do is help our members identify and prepare for those changes and empower them. This is what goes behind the concept of moving from trademarks to brands.

It is exceptional for the organisation and it is extremely rewarding for me as an individual and as CEO of the organisation. There is a rotation of one-third of our board every year. The board is composed of two-thirds corporate members and one third firms.

Having a board that is so diverse and that is always changing and evolving, means that we have a lot of extremely smart and sophisticated people sitting around a table sharing ideas— what else can I ask as CEO?

Having worked in the intellectual property industry for many years, how, in your opinion, has it progressed?

The industry has changed a lot. First, the boundaries between different IP rights are changing and disappearing to a certain extent. If you look at trademark or brand professionals, they are doing more and more. Before, you either did prosecution or enforcement. Now you do both, as well as work on licensing agreements and more data protection and privacy.

The scope of work is increasing, the budgets are shrinking, and the challenges are growing.

What is important as well is that we make sure the changes that are happening in society are reflected in the laws and that we make sure that our administrations and our governments will be able to deal with those changes. This is one of the big goals of the association. www.ippromagazine.com

The Grey Market • Feature

The dangers of the grey market and parallel importing Jan-Maarten Laruijssen of PointerBP takes a deep dive into the grey market

16 IPPro

The Grey Market • Feature For many consumers, it may not be quite clear yet that there are a number of ways in which criminals can take advantage of online shoppers by perpetrating as reputable brands. From counterfeiting to ad-hijacking, brands of all sizes are being targeted by cybercriminals who sell rip-off products to eager consumers at an exponential rate. The vendors are constantly coming up with new methods to skirt the legal system, all the while thinking they won’t get caught. But, while that’s the risk they’re willing to take for their profits, we can’t help but wonder, are the shoppers willing to take that risk, too?

What exactly is the risk?

In many cases, online shoppers are blissfully unaware of the perpetrators looking to take advantage of all the sales-hungry consumers. Though generally these shoppers tend to have the best intentions—just trying to make the most out of their hard-earned income—the truth of the matter is that when they make a purchase on an online marketplace, shoppers run the risk of receiving a counterfeit or, more surreptitiously, a grey market good.

The grey market Grey trade and parallel imports are the processes whereby vendors are re-selling authentic merchandise in markets for which they were not originally intended.

Typically, this is an unauthorised seller who has purchased the goods legally but is selling the authentic merchandise outside of the brand’s official distribution network.

Research shows that cybercrime has generated at least $1.3 trillion in profit in 2018 alone. Needless to say, cybercrime yields a lot of power in today’s trade markets. This is why one of our objectives is to spread the word about the damage that counterfeiting does, and why we believe articles like these matter. First comes knowledge, then comes action.

Why is it called grey trade?

Quite simply, it’s called grey trade due to its position in an unstandardised ‘grey area’ in the trade market. Since the problem is only relatively newly-discovered, there are not many legal grounds initiated yet to combat this exact issue.

There are, however, some legal jurisdictions in place which can be used to enforce against these types of infringements.

For instance, interference would be possible in US trademark law based on the material difference doctrine, and in the EU it’s possible to interfere based on the exception to exhaustion of trademark in the Trademark Regulation and Trademark Directive.

The difference between grey trade and parallel importing Though often used interchangeably, grey trade and parallel imports are actually terms that apply to slightly different breaches of trade protocols. Since ‘parallel imports’ can be used as a legal term, which refers specifically to the importing of products from one market to another, this is a more specific practice in the overall infraction of ‘grey trade’. Conversely, grey trade is more of a blanket term that consists of all kinds of trade, including parallel imports, which do not come from authorised sellers.

Grey trade can take the shape of many kinds of illegal sales of genuine merchandise, and though it may not be counterfeit per se, it is outside of the brand’s official distribution network, thus making it illegal.

Which industries does it affect?

Roughly 15 years ago, a study by KPMG focused on grey market goods found that, although most industries were affected by leakages in their distribution chains leading to their products being found on the grey market, this particular problem was a big challenge for information technology manufacturers and their authorised distributors.

In the study, it was revealed that the American IT industry was losing up to $5 billion annually—a figure that was projected to continue to grow. In addition to this number, it was revealed that within the information technology industry at the time, there was roughly $40 billion in sales passing through the grey market every year. Since then, the figures have been difficult to obtain. However, it has been made clear that the markets most affected are fashion, automobile parts, electronic technologies, healthcare, medical devices, specialty food and beverages, and cosmetics.

Some organisations do have teams or systems in place to detect and combat the breaches in their distribution chains, however, even after all this time, it’s still a prevalent issue that has not been adequately dealt with by government bodies nor the affected businesses themselves.

Why it’s not commonly known Unlike the more standard forms of infringements which brands tend to focus their attention on—transgressions like selling fake or copycat goods—what must be noted is that grey trade and parallel imports are dealing with authentic merchandise.

This is the part that may be confusing for shoppers: if it’s an authentic product, then what’s the big deal? www.ippromagazine.com

The Grey Market • Feature The risk of it all Not only does illegal trade damage a brand’s reputation and strip its profit, but it also has the potential to be harmful to the consumers who are receiving such products.

Take, for instance, when someone orders an electronic device that was intended for another country. The plug would be different, thus the voltage could be different, which means they would need a voltage converter.

If they don’t know this, there is ample opportunity for mishaps to occur in varying degrees of severity. In this same vein, it’s hard not to mention the damage that wrongly traded pharmaceutical and medical products can cause.

If a hospital receives a device with the wrong voltage, the repercussions are immense. If a patient receives a medication that hasn’t been approved by their government’s health board, there may very well be a significant reason for that.

At Pointer Brand Protection, we take intellectual property infringements very seriously. If you think you’ve received a parallel import or any other kind of counterfeit or fake product, you can report it to us through our website, in which case, we’ll look into the item on your behalf.

We strongly advise online shoppers not to take the risk when looking for discount goods, but to shop with caution. Awareness of illegal trade is the first step in creating a safer online market for everyone.

Feel free to check out our website and read some of our blog posts for more knowledge. www.pointerbrandprotection.com/report-a-fake

18 IPPro

All of these ‘maybes’ and ‘coulds’ lead back to our initial point: these are the risks shoppers take when knowingly buying counterfeit and grey trade products. Despite the aforementioned risks being quite dire, there are also some milder risks to consider. There’s the risk that a shopper receives a defective product, the risk that this product breaks down and, due to the unauthorised vendor, that product comes with no warranty. There’s the risk of paying but not receiving a product at all. So what do shoppers have to lose?

The most common risk for them is the combination of a lame product and lost money mixed in with some deep-seated irritation that they’ve been duped. Ideally, shoppers shouldn’t have to worry about the authenticity of their product and its vendor. But, unfortunately, that’s not the world we live in, so we must take countermeasures and we must be made aware.

What to look out for If you order a product online and are unsure if it’s an illegallytraded item, there are a few telling signs to watch out for.

The number one distinguisher of either counterfeit or grey trade goods is the price. Realistically, if you’re looking at a product from a brand whose price is typically significantly higher than the price you’ve found online, chances are it’s illegitimate in some way. Another major sign is the packaging.

If the packaging and instructions are in a different language, that can be a key indicator that your product has been sold illegally. Any products that have significant price differences between markets or geographical locations are more likely to be targeted by grey traders, as there is more marginal profit to make. If you’re concerned about the validity of the product, make sure you start looking for the details when shopping online in order to be aware of what you’re investing your money into.

Counterfeiting is more than a crime Any kind of counterfeiting is considered a crime in most government-regulated countries. Although the grey market and parallel trading fall between blurry lines, it’s best to count them as off limits. It’s also important to be made aware that, contrary to popular belief, counterfeiting is not a victimless crime. By purchasing illegal goods, whether authentic or not, consumers are in fact supporting and funding a litany of harmful institutions and industries, including gangs, criminal organisations, and human trafficking.

On top of which, it should come as no surprise that most counterfeit products are made in forced labour factories which offer notoriously poor working conditions and minimal pay.

For these reasons and more, we advise every online shopper to question whether the discounted price is worth their investment into inhumane schemes.

>Bank Fees >Data Entry >Currency Risk IP firms waste thousands in bank fees and currency costs IP firms lose many thousands of dollars each year paying and being paid by their foreign agents, and up to a third of their annual revenue is tied up in unpaid bills.

Billtrader solves these age-old problems by:

Paying you instantly We give you instant credit for any bill you’re owed.

You can use that credit to pay any foreign agent’s bill, thus freeing up your cash.

Cutting bank fees We have bank accounts around the world, so we pay locally, without bank fees for you or your agents.

Reducing staff costs We automate the process of paying your foreign agents, reducing the need for low-level data entry staff. Lower staff costs mean higher firm profits.

Get in touch with us at sales@billtrader.com to schedule an obligation-free demo of our innovative platform today.

www.billtrader.com

|

sales@billtrader.com

IACC Update • Feature

The power of partnerships: shutting down iOffer and more The IACC’s Bob Barchiesi provides an update on the association and its recent takedown of iOffer’s counterfeit marketplace If you’re one of the tens of thousands of shoppers who recently visited iOffer’s website, you might have been surprised to see the site temporarily shut down. For the hundreds of brands whose products are ripped off by the inferior and dangerous fakes being sold daily on the platform, there was a collective sigh of relief. iOffer has been a tremendous point of frustration for brands and the IP community. Counterfeit goods were widespread across the site, putting well-intentioned shoppers at risk of buying fake goods.

The IACC and our payment partners took decisive action through our signature RogueBlock programme by disrupting the site’s ability to process payments. While iOffer is now up and running again, there is a notable difference.

One brand said: “Now that it [iOffer] is reopened, I wasn’t able to find any fake [company] products, which has never been the case in the past.”

We received similar feedback from several other member and non-member brands, and associations.

Our ability to take effective, swift action on iOffer is just one of the many successes we have achieved through our strategy of partnership and community building. This success, like many of our others, has paid dividends for the greater IP community.

What began as an unrelated meeting at the White House in 2010, sparked the creation of our ground-breaking RogueBlock programme, an anti-counterfeiting programme by the International AntiCounterfeiting Coalition (IACC) and the largest credit card and wire transfer companies—Mastercard, Visa International, Visa Europe, PayPal, MoneyGram, 20 IPPro

American Express, Discover, PULSE, Diners Club and Western Union.

RogueBlock initially drew many critics who were skeptical of our partners’ motivations and our chances of success.

However, RogueBlock soon became the most consequential global programme in mitigating the threats of counterfeits being sold online. Since the programme’s launch, it has shut down more than 6,000 merchant accounts and affected approximately 200,000 websites worldwide.

As the IACC coalesced around a strategy of building a formidable community of stakeholders in the fight against fakes, we expanded our collaboration with other intermediaries, international law enforcement and some of the world’s most famous brands.

In 2012, at a time when brand frustrations with counterfeiting issues on Alibaba Group’s sites peaked, the IACC took bold action. We invested our goodwill, resources, reputation, and capital to form a partnership with Alibaba—a risky but necessary move that very few were willing to take.

Together, we formed the IACC MarketSafe Programme. The programme’s tremendous success paved the way for the IACC MarketSafe Expansion Programme (MSE), an enhanced version of its predecessor that is available to members and non-members for free, and aims to facilitate brands’ transition into Alibaba’s Good Faith Program. Both MarketSafe and MSE have been an invaluable resource for brands and for Alibaba.

Fast forward to 2019, the IACC’s collaborative strategy proved to be a harbinger of the successes to come.

More than 130 brands now participate in the Alibaba AntiCounterfeiting Alliance (AACA) working directly with Alibaba to mitigate the threat of counterfeits on the platform.

IACC Update • Feature

Last year, we launched our partnership with Amazon through a memorandum of understanding and a pilot programme.

The programme, which allows member brands to escalate issues to dedicated Amazon staff, is designed to increase engagement between participating brands and Amazon.

As a result of the pilot programme’s success, we will be expanding it through 2019.

We are proud of what we’ve accomplished thus far and look forward to further developing our collaboration with Amazon in the months and years to come.

If there are any lessons from our experience with RogueBlock, IACC MarketSafe, MSE, and Amazon, it’s that partnerships work.

That is why we will continue to blaze a trailand expand our community of stakeholders who are committed to sharing their information, resources and expertise with us in the fight against fakes.

There is no better time than now to join us. I look forward to the many great things we will do together.

To find out more about the IACC, visit www.iacc.org

We will continue to blaze a trail and expand our community of stakeholders who are committed to sharing their information, resources and expertise with us in the fight against fakes

Bob Barchiesi, president IACC

www.ippromagazine.com

Project Zero • Feature

Amazon’s anticounterfeiting ace Amazon’s new counterfeit takedown tool puts the power in the hands of the brands, but could cause issues for others Ben Wodecki reports Amazon recently launched Project Zero, a counterfeit removal tool allowing brands to remove counterfeit listings on the ecommerce site. The tool is aimed at removing the need for brands to report counterfeit goods directly to Amazon.

It uses automated protections and serialisation alongside the self-removal tool so that brands can have total control over removing counterfeits on the platform. Brands can also upload logos, trademarks and other key brand data, which is then scanned against the entire product listing looking for suspected counterfeits.

Amazon said that tests of Project Zero’s automation aspect have “proactively stop[ped] 100 times more suspected counterfeit products”, compared to what it reactively removed based on reports from brands.

Allowing brands to remove the counterfeits themselves does negate the need to contact Amazon and, at the time of writing, only a few brands have been given access to the tool. In order to gain access to Project Zero, a brand must hold a registered trademark and have enrolled their brands in Amazon’s Brand Registry.

22 IPPro

Mark Del, chief legal and administrative officer of Vera Bradley, which has already used the service, called it “a significant development that will help ensure our customers receive authentic Vera Bradley products from Amazon”.

While Amazon has sought to get rid of the ‘reactive’ element of takedowns, the best active way to remove counterfeits is hitting them at their source. This could mean working out supply chains, monitoring products being posted online, which smaller companies may not have the time nor resources to do.

Smaller companies around notable shopping seasons such as Black Friday or Christmas may struggle to take down the influx of infringing goods during such a busy time of the year.

Kevin Williams, CEO of RGK Innovations says his firm was by targeted by bad actors last Thanksgiving. “Six listing hijackers sprang up while I was with my family at dinner.

We lost the Amazon Standard Identification Number all weekend.”

Products are usually infringed when a brand is popular, especially when its popularity grows quickly. To try and

Project Zero • Feature quell such brand infringement in the past, Amazon used two versions of Brand Registry, its transparency tool, and now, Project Zero. Previous tools focused on battling what Williams called “low-hanging fruit offenders”.

Well-known brands will likely have large legal options, with devoted in-house counsels focusing solely on combating counterfeiters, with Project Zero becoming a welcomed addition to what tends to be an already sizeable arsenal.

But for smaller brands, Project Zero may be the only tool at their disposal.

Tools similar to Project Zero have “work[ed] well for well known, established brands that have teams in place and have trademark registrations in place”, according to Tim Santoni, president and CEO of Santoni Investigations.

One issue that Project Zero doesn’t help with is actually naming the infringers, as Amazon won’t tell brands who is infringing their products. This could be vital for brands of any size in taking down habitual infringers.

Counterfeits make up three percent of worldwide trade according to the Organisation for Economic Co-operation and Development (OECD), so the problem is a massive one for brand owners and one that isn’t going away.

Over half a billion in counterfeit goods were seized by Alibaba Anti-Counterfeiting Alliance members on the Alibaba platform in 2018, but could Amazon be doing more on its own platform? Currently, Project Zero is a very simple, reactive tool that halts the most straightforward example of brand infringement.

It does make reactive enforcement faster, but something focused on all aspects of brand misuse, not limited to fake versions of another product, is clearly needed. Incopro CEO and co-founder Simon Baggs explains that its “a one takedown to one problem solution at speed”.

It is still early days for Project Zero, with a long way to go before it can be declared a total success, but it seems to be a step in the right direction.

He said that there is “a lot of money to be made in it” and that, to some extent, “it feels like not looking at the ultimate problem”.

Amazon’s compliance is only 12 percent compared to eBay and Alibaba’s efforts when it comes to IP claims, according to Williams. Of RGK Innovations’ IP claims, 90 percent come are on eBay. He suggests that Amazon is late in setting up robust controls and is too focused on having a stronger bias towards leaving listings up vs removal.

In order to improve not just Project Zero, but ecommerce platforms as a whole, brand misuse needs to be tackled in an effective and wholesale manner. Given it is so early in Project Zero’s lifecycle, brand owners and professionals are essentially working with what Amazon has said it will do, rather than seeing for themselves.

In terms of how ecommerce platforms should alter brand misuse policies going forward, Baggs said he wasn’t going to hold his breath for any platforms to get on the front foot with this problem.

In terms of altering Project Zero though, Baggs says that going forward it is going to be about making around the edge changes rather than altering it in any major way. If Amazon opted to resist making sensible changes, Baggs said this would surprise him. The biggest change he suggests is a reactive process focused on single issues, but adds that he didn’t think Amazon would “change much in that respect”.

The ultimate takeaway is that brand infringement is not solely about tackling and removing fakes of a certain product. Increasingly other types of brand infringement are in play, with endless examples of brand misuse being seen on Amazon.

Baggs recommends adding the tool to any brand enforcement’s arsenal, but adds that he doesn’t think it is going to deal with all of the problems, warning that the issue of brand infringement was “quite involved and quite broad in scope”.

Moving forward, Amazon appears to have pulled a fairly useful card out from its sleeve, but it may need to shuffle the deck a bit more to better equip itself and users against brand infringement. www.ippromagazine.com

Nimomose/shutterstock.com

Brands in the ecommerce world likely don’t stick to one platform to sell on. For those using multiple platforms, Project Zero is a welcome addition to a fairly sizeable arsenal of enforcement tools. eBay’s Verified Rights Owner (VeRO) programme allows rights owners to report listing that they think could be infringing. According to eBay, VeRO has 50,000 member companies and individuals covering various industries including major software companies and luxury goods manufacturers.

The real problem, according to Baggs, is the networks of bad actors that are engaging in infringement across multiple platforms.

Counterfeits in Russia • Feature

Fame, fortune and counterfeits Evgeny Alexandrov of Gorodissky and Partners discusses the dark side of being a famous brand and how those with rights in Russia can protect them Counterfeiting is the bad side of being a famous brand.

Nobody will produce fakes of a brand which is unknown and counterfeiters make money on selling fake goods bearing the names of popular brands. Very often people may buy such products with clear understanding they are not genuine, but some people may be intentionally misled by the bad guys. In both cases, the brand suffers damage and the brand owner has to defend it. The strategy for defence depends on a country and options available under the local laws of a given jurisdiction.

As far as Russia is concerned, it is a matter of fact that most of counterfeit goods are imported to Russia from other countries. Therefore, it is necessary to monitor the movement of the goods through the border to detect and prevent illegal importations. In this light, it should be noted that the Russian Customs is very active and cooperative with the brand owners whose trademarks are recorded at the special customs IP register. In case the trademark is not recorded in the customs IP register, the customs can do random inspections.

It should also be taken into account that Russia is a member of the Eurasian Economic Union established by five countries: Russia, Belarus, Kazakhstan, Kyrgyzstan and Armenia. Since there are no customs borders between the countries within the union it is advisable to record the trademark in the local customs IP registers of each country-member to prevent illegal importation of the trademarked goods from other countries and its free flow within the union.

Once the goods cross the border they become available to consumers on the local market. Sometimes there are single shipments (private parcels) but in most cases the goods are stored in a huge warehouse from which they are spread throughout the country. It seems that the best approach here will be locating the warehouse or a big sale point and arrange the police raid. In order to go this route an investigation agency should be involved.

Therefore, the efficient strategy for brand protection in Russia should include three main options: 24 IPPro

•

Recordal of a trademark in the Customs IP Register (Russia and Eurasian Economic Union countries)

•

Taking offline legal actions (investigations, police raids, litigation)

•

Online brand protection actions (monitoring and enforcement)

If the brand owner focuses on one option only (for example, offline legal actions), it will not bring positive results and will not be effective. In such a situation the volume of sales of fake or grey imported goods will be increasing, especially taking into account that the worldwide ecommerce market is growing rapidly and it is very easy to sell the goods to other countries without physical presence there. In this regard, building up efficient online brand protection plays an extremely important role in stopping spreading counterfeit goods.

An efficient online brand protection strategy uses online brand protection solutions that reveal the use of a brand on the Internet and send take down notices automatically. In most cases the existing solutions are operating in a similar way but the enforcement actions will depend on the: •

type of platform (marketplace, social media, single website, etc)

•

language issue (search tools, analysts)

•

local laws

According to Russian law the use of the trademark without consent of the trademark owner shall be considered as an infringement and entails negative legal consequences for the infringer (damages, statutory compensation, destruction of goods, etc). This is a legal basis for taking legal actions to stop illegal sales that can be used for automated brand protection solutions allowing sending take down notices to website owners, Internet service providers, Internet hosting providers, platforms (marketplaces, social media, etc).

Counterfeits in Russia • Feature

The first step before sending take down notices is identification of the infringer. The WHOIS database may be used for this purpose. However, in case the domain name is registered by a private person it may create some difficulties since the Russian Data Protection Law does not allow the trademark owner to get information about the private person from the registrar. In the meantime, in case such information is requested by the Russian attorney-at-law it must be provided within 30 days.

Once the infringer is identified, a take down notice may be sent. In order to be valid and effective the same should be based on the relevant provisions of the Russian law and written in the Russian language. Take down notices in foreign language or containing just general wording are usually ignored.

Automated take down notices with standard claims may bring positive results in about 80 percent of cases depending on the compliance rate of the platform or website owner, provided that all formalities are performed in accordance with the requirements.

According to the Russian law a platform shall be considered as an “informational intermediary’”which is liable for infringement of trademark rights if fails to cease the infringement upon receipt of the complaint from the brand owner. Big platforms are usually cooperative with brand owners and remove infringing ads very quickly. However, some local platforms in Russia require take down notices be submitted in original along with a copy of the certified trademark certificate and certified copy of power of attorney.

Also they may raise additional requirements. They may state that they cannot identify whether the advertised product is counterfeit or not and required to produce a copy of the court decision with respect to the particular seller.

Obviously, such an approach is quite bureaucratic and, in fact, may be in favour of sellers of fake goods. www.ippromagazine.com

Counterfeits in Russia • Feature

In order to identify such illegal websites or other internet resources, regular online monitoring is required and automated brand protection solutions would be the best approach to protect brand against online threats

Sometimes, the infringers refuse to remove the trademark from their website or ignore take down notices. In such a situation the brand protection legal team should be creative and elaborate new strategies on the basis of options provided by the local laws.

For instance, in case there are copyrightable subject-matters on the website the brand owner can rely on the law ‘On Information, Informational Technologies and Protection of Information’, according to which the right holder or an exclusive licensee shall be entitled to file a complaint to the domain name owner and/or informational intermediary which must be considered within 24 hours. In case the complaint is not satisfied the rights holder is entitled to file a special lawsuit at the City Court of Moscow which has competence in handling copyright infringement on the internet and can issue an injunctive relief ex-parte within 24 hours. This is an extremely fast procedure which allows to block the website within a short period of time.

Another option is to make an additional pressure on platforms or domain name registrars or informational intermediary through the ‘joint liability’ rule envisaged by the civil code, according to which in case the infringement is committed by several persons they shall be liable for such infringement jointly (para 6.1 of article 1252 of the civil code).

At that on the basis of article 323 of the civil code the claim can be filed against all those infringers or to any of them. It should be also noted that this is not limited to informational intermediaries only but can also allow to submit claims (at least send cease and desist letter) to other persons, including payment service providers, warehouse owners, advertising 26 IPPro

agencies, etc. There is no extensive judicial practice in the application of the said rules in such a way, but it has been already successfully tested at the pre-trial stages.

Counterfeiting is not a single threat for brands on the internet. There are fraud and phishing websites that use website designs identical to the original one with the purpose of stealing users’ personal data and payment details. The infringers can use fake mobile apps, accounts in social media, or even register almost identical domain names to attract users and sell counterfeit goods, or get access to their personal banking cards details.

Sometimes it is very difficult for the internet users to identify fake websites or groups in social media because they look like original. The infringers very often use SEO promotional tools to be ranked in high places in the search engine results and therefore it may happen that the first result a user sees in a search engine is a fraud or phishing website.

In this light, in order to identify such illegal websites or other internet resources, regular online monitoring is required and automated brand protection solutions would be the best approach to protect brand against online threats or at least reveal them before they inflict damage to the brand or consumer, provided that local analysts and lawyers take necessary actions in accordance with the local laws.

The above possible actions against infringements on the internet are not exhaustive and the Russian law provides quite efficient measures that can be used to stop the infringement depending on the circumstances surrounding the particular case.

Need IP innovation?

Here’s the solution

Neuschwanstein Trademark • Feature

Neuschwanstein: protecting cultural heritage by trademark law?

HGF attorneys Jan R. Naefe and Julia Saladin analyse how the State of Bavaria has defended its EU Trademark for the term ‘Neuschwanstein’

It can be assumed that almost everybody knows the fascinating castle Neuschwanstein, which is located in the State of Bavaria, in the Alpine mountains. The castle Neuschwanstein was built starting in 1869 for the romantic King Ludwig II of Bavaria, who adored the music of Richard Wagner, especially the opera ‘Lohengrin’, in which the knight Lohengrin is riding on a swan.

countless economic entities try to use the radiance of this fairy-tale castle in an economical way by using the name or the silhouette as a part of a company name or for designating goods and services.

The State of Bavaria as proprietor of the castle has an interest in avoiding any commercialisation abuse and disparagement of names of national and cultural heritages, for example of the names of castle Neuschwanstein by third parties.

The castle was the visualisation of the romantic dream of a castle from a fairy-tale. Unfortunately, Ludwig II died before the castle was finished and was only in the castle himself a few times during this time. This unique fairy-tale castle with its worldfamous appearance is visited by more than 1.1 million visitors a year. It is intended to include this castle and two other castles of King Ludwig II of Bavaria into the world heritage list of UNESCO.

For that purpose, the State of Bavaria filed and registered a number of trademarks relating to ‘Neuschwanstein’, especially the EU trademark 010144392 ‘NEUSCHWANSTEIN’, which is inter alia registered for a countless number of products in the field of souvenirs.

After the revolution of 1918, the ownership of the castle was transferred to the State of Bavaria, part of the Federal Republic of Germany, from the royal family of Bavaria. Worldwide, especially in Germany,

The Federal Association of Souvenir Traders filed an application for cancellation of this trademark, which, in the end, was judged by the European Court of Justice.

28 IPPro

Neuschwanstein Trademark • Feature

Yevhenii Chulovskyi/shutterstock.com

www.ippromagazine.com

Neuschwanstein Trademark • Feature

The application for cancellation was mainly based on the grounds of the lack of protectability of the sign ‘NEUSCHWANSTEIN’ as a geographical indication of origin.

The European Court of Justice stated that the sign ‘NEUSCHWANSTEIN’ cannot be considered as a geographical indication of origin, as ‘NEUSCHWANSTEIN’ designates the castle as such and not a place for the production of goods and rendering of services, so that the attacked trademark gives no hint on a geographical origin of the goods and services.

Within the cancellation procedure it was emphasised as well that castle Neuschwanstein is mainly a place of museum character, whose main function is not the production of goods or the rendering of services, but the keeping of national heritage.

Encouraged by this decision, the State of Bavaria felt keen enough to file an opposition against a class 43 registered German trademark ‘Ameron Neuschwanstein Alpsee Resort & Spa’ for a hotel.

This hotel opened in March 2019, located at the bottom of the hill on which the castle is located.

Allegedly it was said the State of Bavaria and the owner of the hotel are in ‘amicable negotiations.

Presumably not purely by chance, the State of Bavaria as the owner of the trademark ‘NEUSCHWANSTEIN’ filed a respective trademark ‘NEUSCHWANSTEIN’ (word mark) in class 43 with the German Patent and Trademark Office in 2016 after plans to build the hotel were displayed publicly.

For the authors, it is highly doubtful whether trademark law is the right way to protect the name of national cultural heritage.

Article 7 of the EU Trade Mark Regulation, dealing with the absolute grounds for refusal, stipulates that trademarks which “consist exclusively of signs or

30 IPPro

indications which may serve in trade, to designate the kind, quality, quantity, intended purpose, value, geographical origin or the time of production of the goods or of rendering of the service, or other characteristics of the goods or services,” and “trademarks which include badges, emblems or escutcheons, other than those covered by article 6 of the Paris Convention and which are of particular public interest, unless the consent of the competent authority to their registration has been given”; are excluded from the registration as a trademark.

The EU Trade Mark Regulation and national law in Germany is silent about the name or presentation of national heritage.

If the name or presentation of national heritage does not fall under these specialised rules of article 7 EU Trade Mark Regulation, this would mean that— especially after the judgement of the European Court of Justice regarding Neuschwanstein—the name of a cultural heritage can be registered as a trademark.

This may be good news for the State of Bavaria on one hand, to protect the name of a cultural heritage like the castle Neuschwanstein.

On the other hand, it means that for the maintenance of the trademark protection of such a trademark, those rules apply which apply to all other trademarks as well.

This definitely includes the compulsory use of the trademark for the goods and services which it is registered for.

This is the reason why the judgement of the European Court of Justice for the State of Bavaria may be thought of as a Pyrrhic-victory. As a matter of fact, the State of Bavaria restricts itself on keeping the national heritage but does not use the trademark for all the goods and services it is registered for, especially not for souvenirs, and definitely not for running a hotel.

Neuschwanstein Trademark • Feature

Why not? Because this is or was the original intention of the State of Bavaria as a trademark owner and of course the owner of the castle, not to use the name in an economic way by itself or others.

The general intention is contradicting the purpose of a trademark, when it is not intended to be used for goods and services, but only protect the name of a cultural heritage.

Trademark law and trademarks themselves are not made for that. There is a certain danger for the owner of the trademark Neuschwanstein, the State of Bavaria, that in the near future, they will be caught up by reality if somebody is asking for proof of use.

At this time, the trademark offices as well as the courts in Europe will be faced with the fact that the interdiction of other trademarks and their use on one hand, and the non-use by the trademark owners for the goods and services it is registered for on the other hand collides with the protective purpose of a trademark.

Jan R. Naefe, Partner HGF

The authors show a strong understanding for the intention of the public administration to protect the name of the national or cultural heritage of a country.

Trademark law is not the right attempt to do so, and from this point of view, it would be desirable to put the name or presentation of national or cultural heritage into the list of the absolute grounds of refusal according to article 7 of the EU Trade Mark Regulation, which would render no doubt on one hand. On the other hand, this would not protect the reasonable interest of the public, for which it would be necessary to interdict the use of such a sign of public interest. This problem of course does not only appear in Germany, for example for the name of that wonderful castle, but all over every country with a cultural heritage.

Meanwhile, the State of Bavaria and the owner of the hotel settled the litigation and the opposition by the State of Bavaria was withdrawn, but they negotiated the confidentiality of that settlement. A first step in weakening the former strict position of the trademark owner?

Julia Saladin, Attorney-at-law HGF

www.ippromagazine.com

Brand Partnership • Feature

Somrerk Witthayanant/shutterstock.com

Nokia’s brand partnerships: a future secured As the smartphone wars seemingly come to a close, Nokia sits poised to take advantage of the new world it has created in brand licensing Barney Dixon reports Nokia: an undeniably well-known brand around the world.

From its humble beginnings in 1865, Nokia grew to be a titan of the industry and by 2017 employed around 102,000 people across over 100 countries. While it didn’t quite match its 2017 annual revenues of €23 billion, in 2018 Nokia’s revenue was 32 IPPro

still at a hefty €22.56 billion and it remains the world’s third largest network equipment manufacturer.

Despite the continued mainstream success of Nokia phones, Nokia actually sold its Nokia phones business to Microsoft in 2014 and created Nokia Technologies, a licensing arm containing three business. Now, many Nokia phones are

Intellectual Property in an Innovative World

Brand Partnership • Feature produced under the Brand Partnerships business of Nokia Technologies, which focuses on helping business to leverage the brand recognition of Nokia with its associations of quality, reliability and ease of use.

While Nokia doesn’t separately report revenue for each of the three businesses within Nokia Technologies, overall Nokia Technologies contributed around €1.5 billion in revenues to Nokia last year and contributed around half of Nokia’s gross profit.

Vipul Mehrotra, head of Brand Partnerships, operates in a team whose core focus is to grow the Nokia brand.

The team is made up of what Mehrotra calls “go-to-market experts”, people who “understand the business from a consumer electronics point of view across various aspects”.

In May 2016, Nokia announced a strategic agreement to license the Nokia brand exclusively to HMD Global for 10 years in phones and tablets. Mehrotra manages this relationship and has been instrumental in helping HMD leverage the brand to become one of the top 10 global smartphone manufacturers.

Mehrotra’s team handles both product and brand and supports HMD with guidelines to ensure brand consistency.

According to Mehrotra, there are clear brand requirements and policies that must be followed to maintain brand consistency and leverage the trust that Nokia is known for.

Mehrotra explains that these agreements are more cases of partnership than licensing and Brand Partnerships aims to uphold Nokia’s credibility as a phone and tablet manufacturer, ensuring that the products are reliable and easy to use, maintaining consumer trust.

Mehrotra says the Brand Partnerships business works with partners from concept creation to after sales to “instill the brand promise and our brand attributes across the entire product life cycle”.

Managing such partnerships, especially one where the end result could potentially affect the good standing of the Nokia brand, could prove a difficult task.

instill key policies and guidelines into those partnerships, as well as the business promise that Nokia is known for.”

Mehrotra notes an example: “Our brand licensee sells phones priced at $50, so how can they apply a premium design on something that is at a value price point? Even though that phone is at a value price point, it should still feel like an extension of your hand. It doesn’t have to be made from high end, luxury materials, but we still have conversations with our partners about how different market requirements and different price points can be met within our brand guidelines.”

Mehrotra and his team have an “ongoing dialogue” with Nokia’s Brand Partnerships licensees, discussing what is best for the brand. He adds: “It is essentially a partnership where we look at the market and business requirements together, and the execution and operations are owned by the licensee.

It’s important that licensees believe in the brand, the brand’s DNA and the brand’s promise, but are also willing to invest in the brand.”

“If they are convinced that this is the right brand for them then they need to invest in the brand for their respective category.”

Mehrotra says that HMD has succeeded in doing this by following Nokia’s two most important criteria: buying into the brand DNA and brand promise and investing in the brand.

In the IP sphere, Nokia is probably better-known for its patent licensing and there is a part of Brand Partnerships that crosses over between these two areas.

The Brand Partnerships team works together with the patent licensing team when partnering, but both teams have different profiles and remain unique.

As licensing has become a big part of Nokia’s business, Nokia’s brand value has grown. Mehrotra says Brand Finance has reported a growth of $4.4 billion to $9.8 billion in the past three years. Much of that is due to the B2B side of Nokia, but brand licensing contributes proportionally.

Mehrotra explains that, like with any partnership, there are give and takes.

Into the future, Nokia will remain a well-known brand with a “strong heritage”, as Mehrotra describes it, and, its Brand Partnerships business continues to grow and the smartphone wars die down, it is Nokia’s flexibility and willingness for cooperation that will propel it forward as a brand

He says: “The nature of the business means that our licensee runs and is liable for the business. They have to take on certain risks and actions. From our perspective, we want to

Mehrotra remarks that Nokia’s consumer brand promise extends well beyond phones and concludes: “There is still a lot of love for Nokia.”

34 IPPro

Uncovering actionable intelligence to drive informed decisions.

Core Intellectual Property Investigation services including:  Anonymous Domain/Trademark Acquisitions  Distributor/MLM Compliance Investigations  U.S. Importer/Import Records Analysis  Unauthorized Supplier Identification/Stock Lot Locate (globally)  Third-Party Infringement Litigation Support  Trademark Use Investigations  Unauthorized Seller Identification  Counterfeit Product Investigations For more details on these or our other service offerings, please visit our website or contact us at info@vaudra.com.

+1 704-895-3939  www.vaudra.com

Stokkete/shutterstock.com

How to increase your trademark profits by 20 percent Justin Simpson explains how Billtrader can help trademark attorneys maximise business profits We trademark attorneys have a wonderful job. We get to interact with fellow practitioners on international conferences like the International Trademark Association’s Annual Conference. We get to hear about new business plans and the launch of new products. And we get to champion the rights of innovators as we stave off the imitators riding on their coat tails.

On the flipside, if our local clients need a trademark filed in Europe we delight in the opportunity to send our friendly colleagues across the pond some work. But then, when an invoice comes in we have to figure out the cost in our home currency, wait for our local client to pay, and then pay exorbitant bank fees to get the money across to our colleague.

But there are downsides to our business. When we receive instructions from our friends overseas and promptly file a new application, we often wait many months before we’re paid.

In the meantime, our staff need their salaries paid and the trademark office needs its official fees. So if we don’t keep the cash flowing in, things can get tight.

Many American banks charge $35 to $50 for an international wire. Japanese banks commonly charge $50 to receive a wire.

A payment of $200 to a Japanese trade marks attorney ends up being a lot less on the receiving end. You won’t hear your Japanese colleague complaining because every IP accountant knows that’s just how things work.

36 IPPro

But what if you could be paid straight away for the invoices you send out? And what if you could avoid international banking fees altogether? Sounds impossible, right?

Well fortunately, a group of innovative IP attorneys got together to solve the challenges IP firms have been enduring for decades—slow incoming payments and high international bank fees. Their solution was Billtrader.

Here’s how it works: when you send your invoices to your foreign associates simply copy Billtrader on the email. It captures the invoice details on its platform and pays you everything you’re owed. It then collects the funds from your foreign agents (in a professional and courteous way) over the next few months.

In this way, Billtrader enables you to get paid within seven days for bills that normally take over 120 days to be paid.

Goodbye cash flow issues.

And they have a similar solution for eliminating bank fees when paying your foreign agents. Here’s how that works: When an invoice comes in from your foreign agent, email it to Billtrader as well.

It captures the details on the platform and you can then choose when to pay those invoices in your home currency.

Make one payment to a local bank account (without international banking fees) and Billtrader pays all your agents and sends them a pretty remittance advice, mentioning you and letting your agent know they’ve been paid.

Because you pay into a local account and Billtrader pays your agent from a local account (they have bank accounts covering 45 countries), neither you nor your agent pay any international wiring fees.

Goodbye international banking fees.

Whilst I have your attention, Billtrader can also reduce your accounting staff costs. The platform is integrated with all of the major IP accounting software platforms. That means you can eliminate the following tasks that your accounts team normally does: •

Manually entering details of every single foreign agent bill

•

Manually initiating and authorising international payments

•

Preparing and sending remittance advices

•

Manually marking each foreign invoice as paid

•

Adjusting for differences in payment amounts due to currency changes

•

Adjusting for bank fees

When you add up the cash flow benefits, the bank fee savings, and the staff costs you can save with all of the accounting automation, I wouldn’t be surprised if using Billtrader could help increase your international trade mark profits by up to 20 percent.

Justin Simpson is an Australian Registered patent and trademark attorney and the founder of Billtrader.

Billtrader helps IP attorneys pay and be paid by their IP colleagues around the world.

Prior to Billtrader, Justin founded inovia, the online patent filing platform that rose to file more PCT national phase entries than any law firm in the world.

He sold inovia in 2013 for $29.1 million and is well on the way to making Billtrader an even bigger success.

It has already received over $4 million of investments from 50 patent attorneys from seven of the world’s leading firms.

Learn more at www.billtrader.com or come and see us at INTA (booth 644 in Aisle 600).

www.ippromagazine.com

IP Technology • Analysis

In the right era Elena Galletti of Brandstock explains the many uses for emerging technology in the intellectual property industry How can technology be used in intellectual property departments to increase efficiency?

How are IP management platforms utilising machine learning?

Technology can be used to automate all routine works: deadline, recurrent agreements, docketing, document management, archive and any routine works. Technology can provide a full set of reports, in order to immediately identify weak points in the portfolio, deadlines, mistakes, and provide basis for strategic decisions (for example: the company continues to renew a brand not in use in a country where there are already other similar brands in use, is there a specific reason? Or report based on applicable law divided per country with simple search bottoms).

They are evolving every day and the scenario is impressive!

What sorts of technologies are being leveraged by firms in the IP space?

Chatbots to build agreements, machine learning related to searches and patent annuities payments, drafting, blockchain for brand protection.

Chatbots can be used to fulfill standard agreements, for example, non-disclosure agreements, coexistence agreement, service level agreements and generally speaking all agreements where there is no need to insert special conditions for each case. Theoretically, we can use chatbots for all agreements because artificial intelligence will integrate based on previous agreements discussed and instead of us suggesting new conditions, the chatbot will suggest the best condition to apply.

38 IPPro

One of the best examples, in our opinion, are the new dashboards—including our own at Brandstock—which are built in a way that makes the decision makers immediately understands the needs of the portfolio, the time spent on files, a direct link to cost and cost calculators together with a rating of the firms.

Could you tell me a little bit more about Brandstock’s new dashboard?

I cannot share too much at this stage, but I promise this will be a revolution for both in-house and external professionals.

Brandstock was born in 1993 with the idea of combining IT and IP need. I believe we are in the right era to develop this!

How can these solutions be used in brand management and protection?

In different ways: to archive in a confident and secure way with the peace to have a strong defence in case something happens.

In order to avoid wasting time in searching for proof, sending immediate feedback to customs and authorities. With new machine learning for online brand protection, you are able to

IP Technology • Analysis

capture and fight millions of infringing results in a few minutes.

What is new about the machine learning and AI of today?

Artificial intelligence is already part of our daily life. We wake up and talk to Siri, ask her what the weather is for the day.

Machine learning will tell you directly which brand to renew and why, where you are investing money without return on investment, where the laws are critical and it will be cheaper to try other solutions related to your enforcement programs.

Blockchain will help in securing files and documents and the exchange of information with advisors will be transparent and quicker.

With new machine learning for online brand protection, you are able to capture and fight millions of infringing results in a few minutes bestfoto77/shutterstock.com

Elena Galletti, vice president, marketing Brandstock

www.ippromagazine.com

Moving Marks • Features

Shoot to kill the competition One European trademark application still under review could cause havoc to the video game industry

Ben Wodecki reports New moving trademarks have the potential to advance the trademark world towards new horizons, but with new forms of trademarks potentially closing off avenues for disputable rights in unusual areas, the potential for mishap is present and legislative intervention could be necessary.

EUTM017282203 is a multimedia mark filed by Rebellion, a video game developer best known for its Sniper Elite series. The trademark in question relates to the Sniper Elite games and protects the franchise’s key draw—gory slow-motion kills.

The games allow players to pick up the sniper rifle of Lieutenant Karl Fairburne in a third-person tactical shooter stealth game centred around various theatres of World War II. Players can pick off soldiers from great distances, with the camera following the bullet as it punctures through bodies and organs, displaying each gory detail in slow motion.

Rebellion filed a 25-second clip at the EU Intellectual Property Office (EUIPO) in 2017 depicting three of these gory killcams in classes nine, 28, and 41 in Nice classifications.

Not only is the clip fairly long for a motion mark, but its gory contents could lead to it being refused.

Furthermore, there is a possibility that this mark, if granted, could stop other game developers that want to use similar mechanics, such as a slow motion

40 IPPro

bullet cam, which is already present in other games.

The application is still under examination, but should it be refused? What can the trademark world learn from this perplexing application?

Sharpshooting situations Rebellion’s attempts to trademark this mechanic could be a way of stopping infringing ‘clone’ games.

Since the rise of mobile gaming, video games have been plagued with such copycats and last year PUBG Corporation, the maker of PlayerUnknown’s Battlegrounds, took a clone game to court claiming its mechanics infringed its copyright.

If Rebellion is successful, it is likely other companies will follow suit to tackle copy-cats. However, a great concern from the potential grant of this trademark is that it may hold the power to lock away in-game mechanics. Michael Lee, founding partner at Lee Law dubbed the mark “game-changing”.

Some are concerned that it could cause problems throughout the video game industry as it might allow for game developers to create a monopoly on certain looks or camera shots that have, until now, been commonly used in the industry. Morrison Rothman senior counsel Keith Cooper described Rebellion’s mark as an “end-run around traditional ways to protect gameplay footage”.

The mechanic in question has already been used in a similar way by a number of video game, including Max Payne, Red Dead Redemption, and Fallout 4.

Moving Marks • Features

Often dubbed ‘bullet time’, many of these mechanics are similar—a bullet traveling towards an enemy in slow motion.

Rebellion was not the first to use such a mechanic and examples of similar concepts can be seen in other forms of media, including cinema.

Lee offers a similar example to Rebellion’s mark from the Mortal Kombat games. If its developers, NetherRealm Studios attempted to obtain a similar trademark for its new style of x-ray cutscenes during bone-crushing combos, would that lead to one claiming actual use against the other? This is a question that is yet to be answered.

Would there have been any benefit if Rebellion registered the mark as another form of IP rather than a moving trademark? Patents are hard to obtain, especially for software, and can be very expensive.

Copyright could have been an avenue, but the concept of copyrighting a killcam mechanic could be considered scènes à faire, which prevents the copyrighting of functional elements that are indistinguishable from the underlying idea such that there would be no other way to express the idea.

Robert Przybysz/shutterstock.com

While we await the results of Rebellion’s EUIPO application, how might the US trademark system react to such a mark? Alan Behr, partner at Phillips Nizer says a grant would be unlikely. He adds that Rebellion appears to “have the pig by the wrong ear”.

In the US, the trademark could also raise the scandalous marks issue. The 25 second moving mark clip features three headshots, which could be upsetting to some.

Crosshairs trained on the future Lee warns that trademarked game mechanics could “stifle video game creativity”. He explains that development studios would have to conduct major research before creating games to find out if some key mechanics are trademarked and not usable.

Generally, this is not how video game companies operate. Behr, who spent time as the chief legal officer for the New York company that eventually became Atari, says that, historically, video game companies have been “particularly courteous with each other when it came to trademark rights”.

He remarked on when the company announced the first-person shooter game Quake without owning the trademark rights, and no one had tried to take advantage by “grabbing the mark”.

While a company protecting its rights is not bad faith, it is rare that these sorts of concepts are sought to be protected in the video game industry and it may seem unusual.

But those in the industry must begin to come to terms with the fact that, if this moving mark is granted by the EUIPO, the future of video game mechanics could change drastically.

www.ippromagazine.com

Gene Editing • Feature

Gene edited crops: the next generation of plant breeding innovation Chris Holley of Cooley examines how the gene editing of crops, and the IP that comes with it, will change the plant breeding world Gene editing. To the modern plant breeder, the phrase will become as ubiquitous as ‘hybrid cross’ was to our plant breeding mentors.

The technological magic underlying all gene editing systems is the ability to accurately direct molecular machinery to a specific location in a plant’s genome and have that machinery perform a precise and targeted edit of the underlying genomic code. Just as a computer programmer can add, delete, modify, or otherwise edit the code of a computer program, so too can the modern plant breeder edit the DNA code underlying a trait of interest. This editing does not introduce a foreign gene into the plant’s genome, rather, gene editing merely alters the genes naturally present.

There are many gene editing systems that are part of the repertoire of the plant breeder and they are named with an almost militaristic love of acronyms: ZFNs, TALENS, and CRISPR, are some of the most prevalent. But without a doubt, the newest kid on the block—CRISPR—has captured the imagination of the scientific community and public alike.

Scientists utilising CRISPR for plant breeding applications love the system’s simplicity. By co opting a bacterial evolutionary defense mechanism, we have enabled plant breeders to target edits to a plant genome with the precision of a surgeon’s scalpel.

IP landscape Whenever we see the development of a foundational scientific platform, then we also see a mirror image intellectual property estate being developed to protect the innovation.

The same is true with gene editing. Perhaps adding to the public’s fascination with the CRISPR technology is the well documented battles between two of the earliest founders of the technology, Jennifer Doudna of Berkeley and Feng Zhang of the Broad Institute. Much ink has been spilled over these legal fights and there is no utility in rehashing the conflict here.

Suffice it to say, the contours of IP breadth and scope of the early CRISPR estates are in much clearer focus in 2019 than 42 IPPro

in years past. We have now gained a degree of granularity sufficient for most companies to understand a path forward with respect to securing licences and/or developing alternative strategies to critical CRISPR technology.

Outside of the foundational platform CRISPR estates, we see the advancement of IP portfolios around specific and targeted plant breeding applications of the technology progressing at a near breakneck speed. To date, the company holding rights to the largest CRISPR IP portfolio is DowDuPont, which thrusts the importance of the technology to the agricultural world front and center.

Regulatory paths The US has taken a clear position with respect to plants developed via next generation plant breeding utilising gene editing. The US Department of Agriculture has stated that it will not regulate a gene edited plant, so long as the plant could otherwise have been developed through traditional plant breeding techniques, and contains no foreign genetic material. Essentially, the US has taken the position that the interests of the public, industry, scientific community, and environment, are best served by adopting a product-based approach. In stark contrast, our continental friends across the Atlantic have adopted a process-based regulatory scheme.

Under the European framework, plants developed via gene editing will be regulated in the same manner as transgenic plants (for example, GMOs), irrespective of the fact that the gene edited plant contains no transgenes and is otherwise indistinguishable from a plant produced via traditional plant breeding. In adopting this much scrutinised regulatory stance, the EU took the position that the gene editing process alters the genetic material of a plant in a way that does not occur naturally, and thus these plant varieties should be subject to heightened regulatory scrutiny.

The regulatory framework adopted by the US will lead to rapid adoption and proliferation of the technology across the industry in the domestic market. Unfortunately, the EU’s

Gene Editing • Feature position will have global ramifications and lead to hampered development and adoption of the technology in the European market.

Gene editing will allow us to create drought tolerant crops varieties, thereby increasing food supplies for areas that are currently not hospitable to current crop lines.

Entrants to the field

This will become ever more important in the face of increasing global temperatures.

We are witnessing the democratisation of gene editing in the plant breeding world, with new domestic startups in the sector embracing the technology. For a new generation, gene editing is making plant breeding ‘cool’ again. Today’s young breeders now have the ability to introduce new consumer-focused traits into plants without introducing any foreign genetic material into the genome of the final plant variety. `we are able to close the delta that has existed between the traditional plant breeder, who relied on natural correlations between phenotype and genotype, and the early plant biotechnologist, who was hampered by having to introduce foreign genetic elements into the host germplasm. No longer.

We can have our cake and eat it too with gene editing.

Traits on the horizon There are certainly dozens of intriguing gene edited plants in the works, from: heirloom tomatoes capable of interstate shipment, non-browning mushrooms, celiac friendly wheat, soy containing heart healthy oil, to decaffeinated coffee beans. These are exciting new traits. However, there is a bigger impact that gene edited plants will have, and that is with respect to feeding a global population expected to reach nearly 10 billion people by the year 2050.

Outside of drought tolerance and water use efficiency, gene editing enables breeders to introduce disease resistant traits to make our food supply hardier in the face of fungal and viral pathogens. Gene edited plant breeding must be a key piece in our global food security plan.

Public perception There is a fundamental difference between gene edited plant varieties and transgenic plants. The industry must convey this truth to the public. The regulatory schema adopted by any particular country is in many ways a secondary artifact.

The real battle is in the arena of public opinion. If the public is convinced of the benefits of gene edited plants, if they can see and understand that these plants are indistinguishable from varieties produced by traditional crossing, if they can relate to the traits being introduced, and if they can appreciate the importance of the technology for global food security, then the correct regulatory scheme will fall into place.

The public will demand as much. It’s an exciting time to be in the field of next generation plant breeding. We are witnessing a revolution that will reshape modern agriculture.

Gene editing will allow us to create drought tolerant crops varieties, thereby increasing food supplies for areas that are currently not hospitable to current crop lines

Chris Holly, associate Cooley

www.ippromagazine.com

Domain Names • Feature

Domain names: a valuable business asset but also a risk factor Nathalie Dreyfus of Dreyfus & associés emphasises that domain names are an important asset for brands Why are domain names both a valuable business asset and a risk factor?

What are the impacts of cyberattacks on domain names?

Domain names are the gateway to a businesses website and are a valuable business asset for companies almost as important as its trademarks. Over the years, the number of domain name registrations constantly increases reaching a growth of 3.5 percent in 2018. Moreover, the sales and purchases market of the domain name market show that there is a steady increase in the price of domain names as companies are ready to invest into domain names related to their product name, brand name, and their business activities.

Generally, cyberattacks aim to recover data or funds by using the company’s domain name or email addresses attached to it.

Cyberattacks can impact domain names in several ways. First of all, domain name wholesalers are on the constant lookout for public domain names available for sale. The purpose is to attract the company’s customers, believing that they are going to a site owned by the company, and use this embezzlement for financial purposes. In addition, scammers have been actively launching domain name homograph attacks that consist of using non Latin letters and characters that resemble to Latin characters to replicate registered domain names.

At the same time, domain names are an important risk factor for companies. According to a PriceWaterHouse report, intellectual property is one of the top three business risk factors, with domain names being one of IP related risks.

Indeed, a domain name is potentially a risk factor considering that it can be purchased by a third party and then used for damaging a company’s reputation.

There are many risks related to domain names such as phishing campaigns, identity theft, and cybersquatting attacks that endanger businesses. For instance, Vinci Group fell victim of a fake press release that was sent to subscribers by a mass email campaign associated with the domain name www.vinci.group. As a result, Vinci Group’s share price has plummeted. Therefore, the existence of domain names that replicate a business’ trademark can potentially lead to financial loss.

Moreover, twenty percent of customers do not repurchase from a brand that was a victim of a cyberattack. Thus, businesses that want to attract and retain customers should demonstrate that they are taking all the necessary security measures to protect their domain names.

44 IPPro

Laptop and tablet users do not see the difference between Latin and non-Latin characters. The lookalike domains point to fake lookalike websites. Moreover, there is also the emergence of phishing websites that are linked to social media network pages offering fake contests and sweepstakes. Finally, the Mail eXchanger (MX) record associates a domain name with a mail server and allow the sending of mass email campaigns, which creates the possibility of sending fake email campaigns damaging business reputation. All of the abovementioned cyberattacks can impact domain names and harm a businesses trademark and reputation.

Are there many disputes related to domain names?

Most of the times, domain name disputes are settled through alternative dispute resolution procedures such as the UDRP. The UDRP allows trademark owners to obtain domain name transfer for a small fee. Domain names disputes settled by court decisions are not common. Moreover, ADR cases tend to increase and even more with the General Data Protection Regulation.

Domain Names • Feature

Indeed, the anonymisation of the WHOIS creates a problem in terms of identification because the personal information of domain names’ owner database are no longer available. For instance, it is now almost impossible to simply request to the domain name owner the transfer of the disputed domain name, nor answer the question whether or not a person or a company has rights on a domain name. This lack of information leads to a surge of UDRP disputes.

Moreover, the consolidation of UDRP complaints is now difficult because it difficult to prove that a registration application comes from the same person or company, which resolve in more URDP proceedings. There is also cases where we have to deal with a subsidiary that registered a domain name and is not liable because of this absence of data. In view of the growing importance of domain names, new systems must be designed, such as procedures for lifting anonymity.

monitoring is recommended in order to immediately detect suspicious domain names and to take action before it becomes an issue. Finally, after having taken all the necessary security measures, it is important for businesses to be insured in order to get compensation in case of cyberattack.

Over the years, cybersecurity insurance has developed and has become an indispensable tool in the management of internet based risk.

Nathalie Dreyfus is a French and European trademark attorney and renowned expert consultant to the Court of Appeal of Paris, as well as to the WIPO Arbitration and Mediation Center and the National Arbitration Forum.

How to protect a business from domain name related risks?

First of all, it is important to map the risks that are related to domain names because once they are identified it is easier to take actions to prevent them. It is important to make a strategy by classifying the levels of risks depending on the company and its trademarks, in order to know which threats are more important to fight. For example, so-called parking websites and inactive websites targeting a well-known brand should not be overlooked whereas for others brand it may not be the priority.

Furthermore, companies should bear in mind that there is no such thing as zero risk. In addition, it is necessary to put in place active domain names monitoring strategies. At Dreyfus, we have our own domain name monitoring system.

For valuable business’ trademarks, a 24/7 domain name www.ippromagazine.com

The advantage of selection Preeti Sharma of LexOrbis delves into the category of ‘selection patents’ The category of ‘selection patents’ pertains to specific inventions that are individually novel but selected from a group of a previously known class, and shows some surprising or unexpected benefits. Although selection patents are mostly seen for chemical species/compound, selection may also be made from a numerical range such as temperature/pressure conditions in production methods.

The earliest jurisprudence on the aspect of selection inventions dates to 1969 in a Unichem Laboratories’ case.

In that case, Bombay High Court held that even where an invention consists of the production of further members of a known series whose useful attributes have already been described or predicted, it may possess sufficient subject matter to support a valid patent provided the somewhat stringent conditions prescribed by Maugham. J in I.G. Farbenindustrie A.G.’s Patents 47 RPC 289 as essential to the validity of a selection patent are satisfied. For example the patent must be based on some substantial advance to be gained from the use of the selected members of the known series or family of substances, the whole (or substantially the whole) of the selected members must possess this advantage, and this advantage must be peculiar (or substantially peculiar) to the selected group.

The court did identify the concept of ‘selection patent’ but required that the selected members must possess an 46 IPPro

advantage peculiar to the selection. Further, the Intellectual Property Appellate Board (IPAB) in the year 2009 release major ruling in the respect of selection inventions in the landmark Imatinib case of Novartis v Union of India. The IPAB in its ruling observed that although there is no specific provision of ‘selection patent’ in India, if the basic criteria of novelty, inventive step, industrial applicability, and patentability under sections 3 and 4 are met, the inventive step can be demonstrated by way of an inventive selection.

The IPAB further remarked that ‘in the context of a selection patent the inventive step will generally lie in making the discovery that what has been selected provides a genuine advantage over the generality from which it was selected. The advantage being one that could not be predicted”.

The IPAB also laid down guidelines for patentability of selection inventions in this case, which are the only guidelines on this concept to date. The minimum requirements as specified by these guidelines are as follows: •

Whether there is any statement in the specification where the nature of the invention concerns with some kind of selection

•

Whether the selection is from a class of substances which is already generally known.

Selection Patents • Report

•

Whether the selected substance is new

•

Whether the selection is a result of any research by human intervention and ingenuity opposed to mere verifications

•

Whether the selection is unexpected or unpredictable

•

Whether the selected substance possesses any unexpected and advantageous property

Thus, as per IPAB, an inventive selection of a new, unexpected, and advantageous single member from a known series of a genus can be accepted but the ‘seed’ of selection invention should be in the original specification itself.

The Supreme Court of India gave a landmark judgment on the interpretation of section 3(d) in the Novartis’ Imatinib case in

The Supreme Court of India was not much inclined to accept the differences between ‘coverage’ and ‘disclosure’. The court observed that what is ‘covered’ by any specification should be considered as ‘disclosed’ therein. This frequently becomes complicated and troublesome for applicants when dealing with selected species in India as the applicants frequently wish to patent the non-enabled advantageous selection.

Furthermore, section 3(d) sets a higher standard of inventive step in India whereby apart from establishing novelty and inventive step, it is also necessary to show that the claimed modifications show enhanced efficacy when compared to the known substance.

In case of drugs, efficacy should be shown by way of ‘therapeutic efficacy’. Thus, the invention needs to meet the requirements of section 2(1)(j) as well as section 3(d). The Delhi High Court further reconfirmed this aspect in 2015 in the case of F Hoffman-La Roche v Cipla, where the Court held that section 3 is not an exception to section 2(1)(j). www.ippromagazine.com

Evgenyrychko/shutterstock.com

It has been observed that the Supreme Court of Canada in the case of Apotex v Sanofi Synthelabo Canada is of high relevance in this context. The court observed that “the inventor selects only a bit of the subject matter of the original genus patent because that bit does something better than and different from what was claimed in the genus patent”. In this landmark decision, the Supreme Court gave considerable strength to selection patents by holding selection patents like any other type of patent in nature.

2013. In relation to the issue of selection inventions, one of the arguments taken by appellant was that there is a difference between that ‘which is covered’ and that ‘which is disclosed’.

However, the Supreme Court held that ‘coverage’ should be considered as equivalent to ‘disclosure’.

Selection Patents • Report The standpoint of Indian Patent Office Having seen the stand of higher courts and IPAB for selection inventions, it is also important to look at the perspective of the Indian Patent Office in this regard. It is imperative to note here that despite the absence of any specific provision in the cct, the patent office has never denied the existence and patentability of selection inventions in entirety.

While discussing novelty, the Manual of Patent Office Practice and Procedure issued by Indian Patent Office mentions that “a generic disclosure in the prior art may not necessarily take away the novelty of a specific disclosure”.

“For instance, a metal spring may not take away the novelty of a copper spring.”

However, it also mentions: “A specific disclosure in the prior art takes away the novelty of a generic disclosure. For instance, a copper spring takes away the novelty of a metal spring.”

Furthermore, the guidelines on patentability of pharmaceutical inventions in India were issued by the Indian Patent Office in 2014. While these guidelines do not discuss the concept of selection inventions exhaustively, but they do recognise that the pharmaceutical inventions contain claims related to selection inventions (relating to product and process). While detailing the ways of assessing novelty, these guidelines reconfirm that a generic disclosure does not take away the novelty of a specific disclosure.

In addition, the guidelines provide an example whereby the claimed markush compound of the invention falls within the claimed markush of the prior art.

For this specific example, the guidelines by the Patent Office state: “It is to be checked from the prior art, whether compounds disclosed specifically in the prior art are of such structure so that they can unambiguously take away the novelty of the compound(s) in question. If the compounds of prior art disclosed specifically do not take away the novelty of the compounds in question, then the generic disclosure in the prior art may still be cited for the purpose of inventive step.”

At the same time, the guidelines also provide a second example whereby a fumaric acid salt of a compound is an implicit disclosure when the prior art enables only methane sulfonic acid salt but discloses fumaric acid amongst a laundry list of salt forming acids.

In relation to implicit disclosure, the guidelines further state that the lack of novelty must normally be taken from the 48 IPPro

explicit teaching of the prior art. However, if the disclosure in the prior art is so implicit that it leaves no doubt in the mind of the examiner, an objection regarding novelty should be raised.

It further states the following: “The lack of novelty must normally be clearly apparent from the explicit teaching of the prior art.”

“However, since the prior art is read through the eyes of the person skilled in the art, the implicit features of a document may also be taken into account for determining novelty.

Thus, if the person skilled in the art would read a disclosure as including a particular feature without it being specifically mentioned, it would be considered an implicit feature of that disclosure and lack of novelty may be implicit in the sense that, in carrying out the teaching of the prior document, the skilled person would inevitably arrive at a result falling within the terms of the claim.”

Although the guidelines have acknowledged that a generic disclosure may not specifically take the novelty of the specific disclosure, at the same time, it also states that the lack of novelty should not be implicit in the prior art.

Upon reviewing the patent office database, it appears that the Indian Controllers adopted different approaches while examining selection from a prior art genus.

Some of the cases are 194/DELNP/2009- GRANTED wherein the concept of selection invention was not discussed in strict sense, the compounds falling within the generic disclosure of prior art were allowed once the unexpected effect was demonstrated.

In the matter of 2784/CHENP/2007, which was refused, the compounds falling within the generic disclosure of prior art were allowed once the unexpected effect was demonstrated.

In 1879/KOLNP/2009, the application was allowed after improved/unexpected activity of claimed specific compounds over the generic prior art compounds demonstrated.

In case of 2196/DELNP/2003, the allowability of selection patents in India was acknowledged by the controller. The controller specifically noted: “The arguments regarding the selection patent is acceptable and the present invention very well comes under the category of the selection patent and fulfills all the norms as per the well- established practice in India for grant of a Selection Patent.”

As per the present scenario, a selected species was considered as eligible for protection if shown to have surprising/unexpected property.

Selection Patents • Report

Although the foreign judgments are not binding on Indian judiciary, they are definitely persuasive and help in shaping up a stronger case

Preeti Sharma, senior associate LexOrbis

Selection invention criteria in Indian scenario For protecting a selection invention in India, the selection should not only be novel but also result in an unexpected and advantageous effect.

Further, the selected species must clear the inventive step and section 3(d) provisions of the Indian Patents Act. Although the Supreme Court of India has not ruled in favour of the contention that only the ‘enabled’ subject matter should be considered as covered, it does not follow that the selection inventions are denied in its entirety. The judgment by the Supreme Court of India in the Novartis case was more focused on the interpretation of section 3(d) and not on ‘selection inventions’ per se.

Further, the Judge clearly stated that section 3(d) does not bar protection for all incremental inventions in chemical and pharmaceutical substance.

The court specifically observed as: “We have held that the subject product, the beta crystalline form of Imatinib Mesylate, does not qualify the test of section 3(d) of the Act but that is not to say that section 3(d) bars patent protection for all incremental inventions of chemical and pharmaceutical substances. It will be a grave mistake to read this judgment to mean that section 3(d) was amended with the intent to undo the fundamental change brought in the patent regime by deletion of section 5 from the Parent Act. That is not said in this judgment.”

The guidelines on pharmaceutical inventions issued by the Indian Patent Office after the Supreme Court of India’s judgment in Novartis’ Imatinib case also do provide some indication that selection inventions are not viewed strictly as black or white in India.Apart from the above-stated limited guidance, applicants can also rely on numerous judgments and literature available for selection inventions under the European laws, which have clear guidance on criteria for assessing such inventions.

Although the foreign judgments are not binding on Indian judiciary, they are definitely persuasive and help in shaping up a stronger case.

Conclusion In India, the concept of selection inventions is yet to be tested and interpreted by higher courts and till then, the patentability of selection inventions in India remains arguable.

Amid the grey scenario, there is hope that although there are no statutory provisions in the Indian Patents Act dealing specifically with selection patent, India does not put a strict bar to the protection of such inventions.

Though the exact interpretation is decided on a case by case basis, India has been witnessing substantial increase in patent enforcement activities and it would be interesting to see how the cases will be determined in the near future by the Patent Office in view of the developing technologies. www.ippromagazine.com

Knowledge Management Systems • Analysis

Knowledge is power Caitlin Kavanagh of Minesoft studies how knowledge management systems can help with company-wide integration of IP awareness In recent years, the awareness of intellectual property as a vital asset for any innovation-driven business has led to many companies pushing for better IP integration across all departments interacting in the IP lifecycle. The push is driven by a need to protect the company’s own IP, mitigate risk and generally establish IP consideration among knowledgeable staff, including subject matter experts, for specific businesscritical projects and day-to-day processes.

Knowing and studying global patent data is an effective tool to avoid parallel developments and wasted research and development efforts in overcrowded research fields.

By ignoring and/or undervaluing IP, businesses can be driven into risky situations, such as opening up your company to infringement proceedings which could result in further loss of profits and harm your long-term corporate survivability, or the possibility of competitors taking advantage of your own technological innovations. In essence, IP research and

(Figure 1) 3D landscape showing the top 16 technology concepts filed by APPLE in 2017

50 IPPro

analysis further upstream can help in increasing the grant success rate, decreasing pendency and avoiding wasteful legal and research and development expenditure. Many companies incorporating best practices with respect to IP knowledge management have a net positive outcome with significant return on investment upon frameworks and tools to support such best practices.

Spreading awareness from the top down Finding a way to communicate the importance of IP to the executive branch is a good starting point of an IP awareness strategy, as with their approval IP or patent departments can more easily get buy-in for IP integration into key strategies and day-to-day processes.

This is often done by establishing a monthly forum to give management teams the opportunity to discuss IP-related banners—for example, studying patent literature as a

Knowledge Management Systems • Analysis

source of competitive intelligence, identified competitor action, as foreshadowed by newly published patents, can be used to inform future offensive or defensive strategy, to counter emerging threats or capitalise on opportunities to outmanoeuvre competitors. (Figure 1) Patents are indicative of modern innovation trends and contain important technical information as applicants must describe and explain their inventions in a clear and complete way. As such, a company’s research and development team must be kept aware of the IP landscape—to track emerging technologies and the actions of the competition; ensuring that their current projects are on-trend, while avoiding potential duplication as well as freedom to operate pitfalls. In the past, the IP or legal department of a company may have presented research and development departments with a stack of patent documents to be reviewed, but there are now software solutions to help share this information more efficiently for greater insight and traceability.

Heightened awareness of IP can help businesses to identify competitor infringement of the company’s patents.

Therefore, if inventors, strategists and marketers have a better understanding of IP and know what the business has protected recently, they can also spot and report potential infringements when they come across them.

Monthly IP meetings between department heads from research and development, legal, IP and the c-suite are no longer enough to educate on the value of IP companywide. In these situations, having an effective IP knowledge management system can be beneficial, to incorporate internal company workflows and custom taxonomies to help manage patent knowledge globally throughout the organisation. Those diving in are faced with challenges of volume and accessibility, but perseverance and employment of specialist databases and advanced workflow systems, such as Minesoft’s Pat-KM, that automate many of the processes will pay off in terms of the wealth of insights gained.

(Figure 2) Checking the colour-coded legal status of FN=32454285 across jurisdictions in legal information browser

www.ippromagazine.com

Knowledge Management Systems • Analysis Implementing a knowledge management system Let’s imagine that a company is preparing a project to break into a new technology area. A freedom to operate (FTO) has already been completed by in-house counsel and determined that there are currently no existing patents that will be infringed by the new invention.

With the deployment of Pat-KM, the IP or legal team can work alongside the technical team to set up relevant alerts for the new technology area that they are entering, these alerts can continue to monitor the area to ensure that high-risk patents aren’t being granted in jurisdictions of interest. Should a new patent emerge before the project is complete, it may well be more cost-effective to abandon the internal project and seek a

license rather than continue and risk infringement in key jurisdictions!

Alert results can be set up to move out to recipients automatically, or some companies might prefer to tailor their system to route all information via the IP team by a manual process; should tighter control be a requirement for your business processes.

Pat-KM acts as comprehensive software solution overlay on the data available in PatBase, the web-based global patent database. Users benefit from access to the wide range of search and analysis tools available within the PatBase system, as well as the additional fields and rules set up for your personal archive. PatBase provides access to comprehensive,

(Figure 3) The Pat-KM Snapshot Dashboard provides a useful overview of documents entering the system, common archive fields, commonly appearing assignees, technologies and inventors, etc.

52 IPPro

Knowledge Management Systems • Analysis shareable and searchable legal status information, powerful analytics, citation tracking tools, high-quality machine translations and more.

For instance, if the technical team receives an alert that a patent has been published which the ongoing project may infringe on, they can utilise the legal status browser. PatBase has one of the most comprehensive collections of legal status information in the industry—receiving data directly from the international patent offices, as well as from the global PatBase data feeds. Users can view the status of a patent across multiple jurisdictions, revealing whether their key commercial locations are still open to them. A patent that doesn’t cover where you operate should be monitored to ensure additional documents aren’t filed in those countries but might not be the death knell for your own project.

America, this can highly support efforts such as virtual patent marking, another way to save money and resources. (Figure 2) Effective knowledge sharing is possible, even with users that are outside the technical and legal sphere, such as section heads or company directors who can request a summary of the new information on a particular topic for review. For example, the CEO could choose to check certain documents, monitor a potential licensing opportunity and receive a selection of documents matched to their interests based on the human actions taken by Pat-KM users throughout the previous week, ensuring that all information that crosses their desk is relevant and important to businesses. (Figure 3)

Depending on what this initial inspection finds, secondary routing to business unit leaders, IP legal counsel or other departments can be automatic, thereby allowing the full chain of knowledge to be captured and disseminated to the right groups of people across the IP lifecycle.

Companies can utilise IP knowledge management systems to facilitate knowledge sharing within multiple business units—even across borders. Monitoring new documents and information, adding additional information internally (where necessary) and then indexing, classifying and distributing information directly to the interested parties within an organisation. All employees can access the influx of new patent applications from around the world, whatever their level of IP expertise, with access to a shared system. Pat-KM can be used not only to capture, archive and disseminate valuable IP data but also as a training tool to get employees to a point where IP is embedded into all thought processes, from the launch of a product to the beginning of a new project.

Similarly, a company’s own patent portfolio can be categorised in a hierarchical tree so that portfolio organisation mimics the structure which the executives choose to see. In

Contact Minesoft today to find out how Pat-KM could work for your business, call us on +44 (0)20 8404 0651 or email us at info@minesoft.com.

In another example, competitive patents which become seen via these current awareness alerts can be routed to the appropriate subject matter experts for initial inspection, categorisation and tagging.

Companies can utilise IP knowledge management systems to facilitate knowledge sharing within multiple business units—even across borders

Caitlin Kavanagh, Marketing executive Minesoft

54 IPPro

Online brand protection

with an impact.

MARKET PROTECT.

SOCIAL PROTECT.

DOMAIN PROTECT.

PAID SEARCH PROTECT.

APP PROTECT.

DISTRIBUTION PROTECT.

CASE MANAGEMENT.

INVESTIGATIONS.

GET A WINNING BRAND PROTECTION STRATEGY

Request a free live demo! pointerbrandprotection.com

Naritaweg 116 - 1043 CA, Amsterdam The Netherlands +31 (0)20 30 319 35 / info@pointerbp.com

Request a demo!