WEB SHIPPING ruling: CTM injunctions both are and aren't pan-European

This morning the Court of Justice gave its ruling in Case C-235/09, DHL Express France SAS (formerly DHL International SA) v Chronopost SA, a case which the IPKat suspects will be greatly discussed, analysed, applied and indeed misapplied in years to come.

Web shipping, or clipper art?

The facts were quite straightforward. Chronopost owned both French and Community trade marks for the sign WEBSHIPPING, for, inter alia, "services relating to: logistics and data transmission; telecommunications; transport by road; collecting mail, newspaper and parcels; and express mail management". DHL, a competitor, had used the signs WEB SHIPPING, Web Shipping and/or Webshipping to designate its own online-accessible express mail management service. Chronopost sued DHL for trade mark infringement before the Tribunal de grande instance de Paris, a Community trade mark court. The court held DHL liable for infringing Chronopost's French mark, but did not adjudicate on infringement of the Community trade mark. Following an appeal, the Cour d’appel de Paris prohibited DHL from continuing to use Chronopost's French and Community trade marks, also ordering a periodic penalty payment if the injunction were breached.

DHL's appeal to the Cour de cassation was dismissed, but that court heard the cross-appeal of Chronopost in which it submitted that the Cour d’appel judgment was contrary to Articles 1 and 98 of Community Trade Mark Regulation 40/94 (CTMR) in so far as the prohibition against further infringement of the Community trade mark WEBSHIPPING, subject to a periodic penalty payment, did not explicitly extend to the entire area of the European Union.  According to the Cour de cassation, since the judgment did not contain any operative words expressly relating to the application to extend the prohibition issued by that court to the entire area of the European Union, it must be construed as applying only to French territory. However, since it had doubts as to its interpretation of Article 98 of the CTMR, the Cour de cassation decided to stay proceedings and to refer the following questions for a preliminary ruling:

"1. Must Article 98 ... be interpreted as meaning that the prohibition issued by a Community trade mark court has effect as a matter of law throughout the entire area of the [European Union]?

2. If not, is that court entitled to apply specifically that prohibition to the territories of other States in which the acts of infringement are committed or threatened?

3. In either case, are the coercive measures which the court, by application of its national law, has attached to the prohibition issued by it applicable within the territories of the Member States in which that prohibition would have effect?

4. In the contrary case, may that court order such a coercive measure, similar to or different from that which it adopts pursuant to its national law, by application of the national laws of the States in which that prohibition would have effect?"

In answer to these questions, the Court ruled thus:

"1. Article 98(1) ... must be interpreted as meaning that the scope of the prohibition against further infringement or threatened infringement of a Community trade mark, issued by a Community trade mark court whose jurisdiction is based on Articles 93(1) to (4) and 94(1) of that regulation, extends, as a rule, to the entire area of the European Union. [see comment below]

2. Article 98(1), second sentence, ...  must be interpreted as meaning that a coercive measure, such as a periodic penalty payment, ordered by a Community trade mark court by application of its national law, in order to ensure compliance with a prohibition against further infringement or threatened infringement which it has issued, has effect in Member States to which the territorial scope of such a prohibition extends other than the Member State of that court, under the conditions laid down, in Chapter III of Council Regulation ... 44/2001 ... on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, with regard to the recognition and enforcement of judgments. Where the national law of one of those other Member States does not contain a coercive measure similar to that ordered by the Community trade mark court, the objective pursued by that measure must be attained by the competent court of that other Member State by having recourse to the relevant provisions of its national law which are such as to ensure that the prohibition is complied with in an equivalent manner". [This should be fun in terms of compliance. EU Regulations are directly applicable in national law, but courts may not find that their national law lets them make up equivalent relief all by themselves.  Article 11 of the IP Enforcement Directive makes recurrent payments optional, but the effect of this ruling is to make them compulsory in these circumstances even if they are not available to local litigants]

Essentially, what the court said was that, since the jurisdiction of Community trade mark courts is pan-European and the scope of Community trade marks is pan-European, in principle an order made by a Community trade mark court in respect of a Community trade mark is pan-European too -- even though infringement of a Community trade mark is governed in each country's Community trade mark court by the national law relating to infringement of a national trade mark.  There are two exceptions to this. One is where the plaintiff only asks for partial relief.  Also, in paras 46 to 48:

"... The exclusive right of a Community trade mark proprietor, as provided for under Article 9(1) of Regulation No 40/94, is conferred in order to enable that proprietor to protect his specific interests as such, that is, to ensure that the trade mark is able to fulfil its functions. The exercise of that right must therefore be reserved to cases in which a third party’s use of the sign affects or is liable to affect the functions of the trade mark (see, to that effect, Joined Cases C-236/08 to C‑238/08 Google France and Google [2010] ECR I-0000, paragraph 75 and the case-law cited)

It follows ... that the exclusive right of a Community trade mark proprietor and, hence, the territorial scope of that right, may not extend beyond what that right allows its proprietor to do in order to protect his trade mark, that is, to prohibit only uses which are liable to affect the functions of the trade mark. The acts or future acts of a defendant (namely the person whose use of the Community trade mark is complained of) which do not affect the functions of the Community trade mark, cannot therefore be prohibited".

Accordingly, if a Community trade mark court ... finds that the acts of infringement or threatened infringement of a Community trade mark are limited to a single Member State or to part of the territory of the European Union ... because the defendant proves that the use of the sign at issue does not affect or is not liable to affect the functions of the trade mark, for example on linguistic grounds, that court must limit the territorial scope of the prohibition which it issues. [Does this mean that where, on account of phonetic and conceptual similarity that exists in some EU states but not others, an injunction to prohibit use of a mark similar to a CTM cannot be prohibited in countries in which no likelihood of confusion exists, since that cannot affect the functions of the CTM?  Or does it mean that functions other than the "essential function" of indicating identity of origin have to be invoked in order to retain the pan-EU nature of the injunction?]

Merpel notes para.42 of the ruling:

"The unitary character of the Community trade mark is also apparent from the fifteenth and sixteenth recitals in the preamble to Regulation No 40/94. These state, first, that the effects of decisions regarding the validity and infringement of Community trade marks must cover the entire area of the European Union, in order to prevent inconsistent decisions on the part of the courts and OHIM and to ensure that the unitary character of Community trade marks is not undermined, and, second, that contradictory judgments should be avoided in actions which involve the same acts and the same parties and which are brought on the basis of a Community trade mark and parallel national trade marks. ".

This would appear to suggest that the court did not intend anything it said about the unitary character of the Community trade mark to point to its likely position on "genuine use" of a Community trade mark in only part of the EU.

Not acte clair, but easy as A, B ... see!

Acte Clair, Cat Claire or Claire de Lune?

We have another A and B situation today, but this time it's not Anheuser-Busch and Budvar.  Back in November Mr Justice Floyd gave judgment in Football Dataco Ltd, The Scottish Premier League Limited, The Scottish Football League Limited and PA Sport UK Limited v Sportradar GmbH & and Sportradar AG [2010] EWHC 2911 (Ch), Chancery Division, England and Wales. In this action the claimants ("FDC") exploited certain data relating to English and Scottish football matches. This data, which was compiled in a database known as "Football Live", included goals scored, goal-scorers, penalties, yellow and red cards and substitutions; it was both updated and provided to third parties while matches were actually taking place. The defendants, Sportradar (a German company and its Swiss parent) assembled data relating to live English and Scottish football matches from public sources and called it "Sports Live Data". Their data was stored on webservers in Germany and Austria but could be accessed via links from elsewhere, including the United Kingdom.  FDC sued, alleging infringement of their UK copyright and database right. Sportradar denied liability since, whatever they might be doing, they weren't doing it in the UK; nor were they domiciled in the UK. The courts of England and Wales therefore had no jurisdiction. The German Sportsradar then sued FDC in Germany in July, seeking negative declarations that its activities did not infringe any of FDC's IP rights.

FDC then applied to amend their Particulars of Claim in order to clarify the nature of the acts which they alleged to constitute infringements and also to add some new ones.

Floyd J started by warning that it was important to examine with some care what, if any, claims were made in the original Particulars of Claim. This was because Sportradar argued that, by virtue of its application for declarations of non-infringement, the German Court was first seized of any claim which the English Court was not properly seized of before July. That exercise had to be carried out without the benefit of the amendments for which permission had not yet been granted. Jurisdiction with regard to the German company was governed by the EU's Judgments Regulation and, in the case of the [non-EU] Swiss company, by the Lugano convention.

Could FDC show a "good arguable case" of UK copyright and/or database right infringement in order to establish jurisdiction in the UK? On the basis of the evidence, Floyd J said "no": Sportradar had not done any act of reproduction (in respect of copyright) or extraction (in respect of database rights) in the UK. As for re-utilization in respect of database right, Article 7(2)(b) of the Database Directive stipulated that
Any form of making available to the public all or a substantial part of the contents of a database by the distribution of copies by renting, by on-line or other forms of transmission. This raised a question of law of where the act of "making available" occurred. The issue was closely related if not identical to an issue raised on the amendment application of where "making available" occurred for the purpose of section 20 of the Copyright Designs and Patents Act 1988. He had to face this issue since, where a question of whether the Court has jurisdiction turns on a pure question of law, that question has to be decided.

Referring by way of analogy to the debate as to where a "broadcast" occurred (was it at the place of transmission or also at the place of receipt?) he pointed to the Satellite Broadcasting and Cable Re-transmission for broadcasts orginating within the EU. Under that directive, a broadcast occurs where the signals are introduced under the control of the person making the broadcast into an uninterrupted chain of communication (the "emission theory"). Said Sportradar, the emission theory should equally apply to the making available right and to re-utilization, since the act which statute deems to be the infringement is a "making available" and the public do not have to actually access the database to infringe. The judge agreed: that right would prevent transmission or re-transmission in a state to which the Directive applies and other restricted acts would prevent further use of the database within the state of reception. He said:

"... the better view is that the act of making available to the public by online transmission is committed and committed only where the transmission takes place. It is true that the placing of data on a server in one state can make the data available to the public of another state but that does not mean that the party who has made the data available has committed the act of making available by transmission in the State of reception. I consider that the better construction of the provisions is that the act only occurs in the state of transmission".

Though the point was not acte clair, Floyd J felt that he could still rule on it and therefore decided not to refer the point to the Court of Justice of the European Union (ECJ), particularly since the issue was not determinative of whether the court had jurisdiction at all. This was because he interpreted the Particulars of Claim as alleging acts of reproduction and extraction by Sportradar's end users in the UK who downloaded the data from the their servers. Although the customers/end users were not party to the proceedings, the pleadings alleged that Sportradar had authorised and/or was jointly liable for, the acts of the end users/consumers. On this basis, the English court had jurisdiction to rule on whether Sportradar had authorised, or was jointly liable for, the acts of reproduction, extraction and re-utilisation of a substantial part of the Football Live database.

Turning then to FDC's application to amend its application, he felt that he could not allow any amendment which raised a new cause of action if it was already within the scope of the German proceedings. He therefore allowed the amendments which gave further particulars of joint tortfeasorship by Sportradar and which pleaded communication to the public by its customers -- but not an amendment alleging making available by Sportradar itself under the Copyright Designs and Patents Act 1988, section 20.

Today the Court of Appeal (Lords Justices Laws, Jacob and Wilson) [2011] EWCA Civ 330, hearing the appeal and cross-appeal, decided to refer the following questions to the ECJ for a preliminary ruling:

"Where a party uploads data from a database protected by sui generis right under Directive 96/9/EC ("the Database Directive") onto that party's webserver located in member state A and in response to requests from a user in another member state B the webserver sends such data to the user's computer so that the data is stored in the memory of that computer and displayed on its screen
(a) is the act of sending the data an act of "extraction" or "re-utilisation" by that party?
(b) does any act of extraction and/or re-utilisation by that party occur
(i) in A only
(ii) in B only; or
(iii) in both A and B?".

In making this reference, and before reviewing the parties' arguments, the Court summarised the position thus, at paragraphs 42 to 45:

"42. In the case of the UK database right, the claimants say that this means making available to the UK public. That they say the defendants do by copying (re-utilizing) Football Live on their Austrian server and transmitting the copied data to those members of the UK public who click on "live scores". "Transmission," they say, in the case of provision of data over the internet or indeed otherwise by wire involves both the acts of hosting the website (Austria and Holland in this case) but also the act of the user in accessing it. It is not transmitted unless and until it is received. Before there can in reality be a transmission there must be a transmittor and a transmittee. This I will call the "transmission theory" or the "communication theory". 

43. The defendants say not so, that acts of "transmission" occur only in the place from which the data emanates. This was called the "emission theory." The Judge thought that the "better view" was that the defendants were right about that though it was not acte clair. 

44. Before us the parties deployed considerable arguments in support of their respective positions. Mr Mellor contended that the argument was so strong in the claimants' favour to be acte clair. After we had heard him we were not satisfied of this. Mr Carr did not dispute that position or that the point was important and could be decisive. He did not, therefore, oppose a reference to the CJEU. 

45. We decided it was not appropriate for us to form our own view about this very important and difficult question".

In consequence of this reference, the part of FDC's action relating to direct liability for sui generis database right infringement must necessarily be stayed -- but the part relating to joint-tortfeasorship by unlawful communication to the public can proceed merrily on its way.

Addendum: in his haste to get this post up-and-running, the Kat left out the bit about infringement of copyright in an original database (in contrast with infringement of the sui generis database right), so Merpel is adding it now. At paragraphs 14 to 18 Jacob LJ killed any suggestion that there was such an infringement on the facts before the court:

"14. I turn first to the copyright claim. The criteria for subsistence of copyright in a database are that "by reason of the selection or arrangement of their contents, it constitutes the author's own intellectual creation". The defendants contend that the data collected by the claimants' agents is not of that sort – it involves no intellectual creation. Therefore, they submit, there is no copyright right at all. Alternatively, they submit, the data alleged to have been copied (namely goals, goalscorers, own goals, penalties, yellow and red cards and substitutions) are matters of pure fact. Such data is merely the contents of the alleged copyright and is precluded from protection by way of copyright by virtue of Art. 3.2. 

15. I accept the latter submission. The Judge was obviously sympathetic to it (and to the attack on copyright subsistence as a whole) for he said:

[49] Paragraph 22 of the particulars of claim alleges that the compilation of Football Live involves "considerable skill, effort and/or intellectual input by experienced personnel to generate, select and/or arrange its contents". There is also an allegation that a substantial part has been used: see paragraph 37. In the light of the law as stated above, those combined allegations must include the allegation that what is taken is a substantial part of the intellectual input of the authors. Those allegations are supported by a statement of truth from each claimant. Mr Cuddigan's argument that the part alleged to have been reproduced by his clients does not amount to an intellectual creation is not supported by any evidence. Whilst the court might have a view based on its own impressions, I do not think that it would be right to place those ahead of what is properly in evidence. In those circumstances, whilst there may ultimately prove to be force in the argument, I think the claimants have a good arguable case on this issue.

16. Unlike the Judge I think the point can be dealt with now. The statement of truth really adds nothing. It may be that some of the information collected for the claimants includes matter which involves intellectual creation. So there may be copyright in Football Live. But what is alleged to have been copied is mere data on any reasonable view. Its recording may sometimes involve some skill (who scored in a goalmouth scramble) but it is not creative skill. 

17. Nor, speaking more technically, do I think it matters that there is no evidence saying that the matter taken does not amount to intellectual creation. For I cannot imagine any credible evidence to the effect that it does. And actually, although the particulars of claim are supported by a statement of truth (so are a sort of evidence) there is no assertion that what was taken amounted to the taking of work involving intellectual creation.

18. It follows that when the proceedings started the court was not seized of a claim in copyright to the necessary standard. From that it follows that the argument we heard about "authorising" an act restricted by copyright (which by s.16(2) of the Act constitutes an infringement) becomes irrelevant. I say no more about it other than I saw considerable force in it.".

Acte clair here
Eclair here
Claire de Lune here

Trade marks, AdWords and the location of harmful events: some brain-teasers

Without the facts, the IPKat isn't even sure
if this is the right Wintersteiger

Now here's a good IP question or two for the Court of Justice of the European Union -- it's coming up in Case C-523/10 Wintersteiger [courtesy of the UK Intellectual Property Office, here] and the questions run like this:

"1. In the case of an alleged infringement by a person established in another Member State of a trade mark granted in the State of the court seized through the use of a keyword (AdWord) identical to that trade mark in an internet search engine which offers its services under various country-specific top-level domains, is the phrase "the place where the harmful event occurred or may occur" in Article 5(3) of Regulation 44/2001 ("Brussels I") is to be interpreted as meaning that;

1.1. jurisdiction is established only if the keyword is used on the search engine website the opt-level domain of which is that of the State of the court seized;

1.2. jurisdiction is established only if the search engine website on which the keyword is used can be accessed in the State of the court seized;

1.3. jurisdiction is dependent on the satisfaction or other requirements additional to the accessibility of the website?

2. If Question1.3 is answered in the affirmative: Which criteria are to be used to determine whether jurisdiction under Article 5(3) of Brussels I is established where a trade mark granted in the State of the course seized is used as an AdWord on a search engine website with a country-specific top-level domain different from that of the State of the court seized?"

The IPKat is surprised only that it has taken so long for these issues to reach Europe's highest court, given the high level of internet (and AdWord) use within a single market in which there are so many countries and jurisdictions.

If you would like to advise the UK Intellectual Property Office on these issues, thus enabling the UK government to decide whether to get involved or not, you can email your thoughts here.  As usual, the time for response is absurdly short, and is really an insult to the intellectual property community: you have to submit your comments by Tuesday 4 January 2011 -- and there aren't exactly many working days between now and then.   The deadline for the court to receive observations is 1 March 2011.

Merpel says, can any reader tell her what the underlying dispute is all about?

Judge applies One in a Million principle against CyberScot

If you've seen this movie, you
probably ARE one in a million

It's not often that the IPKat ventures into the remote and exotic surroundings of the Queens Bench Technology and Construction Court, but he has found this delightful little gem from a judge he never knew existed, Mr Justice Edwards-Stuart. The case is Lifestyle Management Ltd v Frater [2010] EWHC 3258 (TCC) and judgment was given last Friday.  In just a few short paragraphs the judge gave interim relief to two foreign companies in their dispute against a Scottish cybersquatter who was not only using near-identical domain names but was allegedly infringing copyright, passing off and acting in breach of confidence.  Since the defendant was demanding money from the claimants, the judge had the opportunity to apply the Court of Appeal's ruling in One in a Million, in which the notion of an adversely-held website being an "instrument of fraud" was espoused.  Since the judgment was so short, the Kat is reproducing almost all of it here.  It's interesting for the jurisdictional issue too.

"... The Claimants are companies registered in Kenya and the British Virgin Islands, respectively. The Respondent lives in Scotland.

The Claimants carry on business in, I assume, Kenya as financial advisers to expatriates from the United Kingdom working, mainly, in Africa. The Claimants engaged the Respondent as an agent. The terms of that contract are not relevant to this application save for the fact that it contained no jurisdiction clause. That contract has now been terminated. The Respondent claims that he is entitled to commission under the terms of the contract which the Claimants have not paid. The Claimants deny that the Respondent is owed any commission, or at least that he is owed as much as he claims.

... The Claimants have a website with the domain name "offshorelsm.com". According to this evidence the Respondent has registered the domain names "offshorelsm.net", "offshorelsm.org" and "offshorelsm.co.uk". If one goes to these websites there is on at least one of them a home page that bears a very close resemblance to the home page of the Claimants' website. On one, if not both, of the others the Respondent has set out confidential extracts of the Claimants' presentation (or method of presentation) to clients and a photograph of the members of the Claimants' staff. These websites contain material that it is arguably defamatory of the Claimants and which is certainly calculated to damage their business.

The Respondent has made it quite clear that he intends to "cyber squat" using these websites until the Claimants pay the sum that he is currently demanding. The terms of his e-mails to the Claimants make it clear beyond any doubt that his intention is to injure their business and to go on doing so for as long as his demand for payment is not met. One of the websites says this in terms.

Mr Matthew Richardson, who appeared for the Claimants ... submits that the Respondent is using these domain addresses, together with the simulation of the Claimants' home page, to deceive clients of the Claimants, or companies and organisations in England who may refer clients to the Claimants, into going onto one or other of his websites in the belief that they are the Claimants' website and then using the content of those websites to damage the business of the Claimants.

Mr Richardson submits that the Respondent's conduct amounts to the tort of using unlawful means to injure another or is a form of reverse passing off, in the sense that having deceived potential clients to go onto his websites they are then exposed to information that is intended to damage or to undermine the credibility of the Claimants' business.

In my judgment the conduct of the Respondent as disclosed in the evidence before me establishes the threefold requirement of (1) a reputation (or goodwill) required by the Claimants in their domain name"offshorelsm.com", (2) a misrepresentation by the Respondent's use of domain names calculated to lead potential clients of the Claimants into thinking that his three websites are websites of the Claimants and (3) damage to the Claimants ... 

Mr Richardson has also referred me to the case of British Telecommunications plc v One in a Million Ltd [1999] 1 WLR 903, a case which the defendants registered the claimants' company names as domain names as part of a scam to gain money from the legitimate owners. Aldous LJ said, at 920:

"In my view there can be discerned from the cases a jurisdiction to grant injunctive relief where a defendant is equipped with or is intending to equip another with an instrument of fraud. Whether any name is an instrument of fraud will depend upon all the circumstances. A name which will, by reason of its similarity to the name of another, inherently lead to passing off is such an instrument. If it would not inherently lead to passing off, it does not follow that it is not an instrument of fraud. The court should consider the similarity of the names, the intention of the defendant, the type of trade and all the surrounding circumstances. If it be the intention of the defendant to appropriate the goodwill of another or enable others to do so, I can see no reason why the court should not infer that it will happen, even if there is a possibility that such an appropriation would not take place. If, taking all the circumstances into account the court should conclude that the name was produced to enable passing off, is adapted to be used for passing off and, if used, is likely to be fraudulently used, an injunction will be appropriate.

It follows that a court will intervene by way of injunction in passing off cases in three types of case. First, where there is passing off established or it is threatened. Second, where the defendant is a joint tortfeasor with another in passing off either actual or threatened. Third, where the defendant has equipped himself with or intends to equip another with an instrument of fraud. This third type is probably a mere quia timet action."

Whilst the facts of this case are not the same as those in One in a Million, it seems to me that the essential ingredients of a deceptive use of a company name with an acquired goodwill in order to damage the owner of that name are present here.

The problem that troubled me when this application first came before me last week was whether or not I had jurisdiction to entertain the application. As I have mentioned, the Respondent lives in Scotland. Schedule 4 to the Civil Jurisdiction and Judgements Act 1982 provides that persons domiciled in a part of the United Kingdom shall be sued in the courts of that part unless the case comes within rules 3 to 13 of the Schedule.

Mr Richardson relies on rule 3(c). This provides that a person domiciled in part of the United Kingdom may, in another part of the United Kingdom, be sued . . . in matters relating to tort "in the courts for the place where the harmful event occurred or may occur".

Mr Richardson submits, and I accept, that in the circumstances that I have already described potential clients of the Claimants, or companies or organisations who employ such clients and with whom I am told the Claimants enjoy a relationship, may go on to one of the Respondent's websites in the mistaken belief that it is the website of the Claimants - thereby being deceived - and will then be put off by what they find there. This, he submits, is a harmful event within the meaning of rule 3(c) of Schedule 4 of the 1982 Act with the result that the claimants can sue the Respondent in the courts of England and Wales.

I have been persuaded on the evidence before me that this submission is a good one. The evidence indicates also that the Respondent is in possession of the Claimants' confidential database of their clients.

Accordingly, I am satisfied that this Court has jurisdiction to entertain the application and that interim relief should be granted, against the usual undertakings, in the form that I have set out above.

I am not prepared to make the order requiring the Respondent to relinquish his interest in the three websites that I have identified, or to transfer the domain names to the Claimants, without giving the Respondent an opportunity to be heard. I have therefore adjourned that part of the application to the return date".

The IPKat looks forward to the next instalment.

"Making available" only happens where it happens

On Wednesday Mr Justice Floyd handed down his keenly-awaited ruling in Football Dataco Ltd, The Scottish Premier League Limited, The Scottish Football League Limited and PA Sport UK Limited v Sportradar GmbH & and Sportradar AG [2010] EWHC 2911 (Ch), a sharply-contested battle that took place in the genteel surroundings of the High Court, Chancery Division, for England and Wales. The result: we now know something which many of us already suspected -- that where an alleged infringement consists of the act of making a work available to the public, "making available" by online transmission is committed (and only committed) where that transmission takes place.

So what happened in this case? The claimants ("FDC" for ease of reference) exploited certain data relating to English and Scottish football matches. This data, which was compiled in a database known as "Football Live", included goals scored, goalscorers, penalties, yellow and red cards and substitutions. That data was both updated and provided to third parties while matches were actually taking place. The defendants, Sportradar, were a German company and its Swiss parent. What did they do? They assembled data relating to live English and Scottish football matches from public sources and called it "Sports Live Data". Their data was stored on webservers in Germany and Austria but could be accessed via links from elsewhere, including the United Kingdom.

FDC launched proceedings in April 2010, alleging infringement of their UK copyright and database right. No, said Sportradar -- whatever they might be up to, they weren't doing it in the UK; nor were they domiciled in the UK. The courts of England and Wales therefore had no jurisdiction. The German Sportsradar then cunningly sued FDC in Germany in July, seeking negative declarations that its activities did not infringe any of FDC's IP rights.

Back in England, FDC then applied to amend their Particulars of Claim in order to clarify the nature of the acts which they alleged to constitute infringements and also to add some new ones.

Floyd J started by warning that it was important to examine with some care what, if any, claims were made in the original Particulars of Claim. This was because Sportradar argued that, by virtue of its application for declarations of non-infringement, the German Court was first seized of any claim which the English Court was not properly seized of before July. That exercise had to be carried out without the benefit of the amendments for which permission had not yet been granted. Jurisdiction with regard to the German company was governed by the EU's Judgments Regulation and, in the case of the [non-EU] Swiss company, by the Lugano convention. Could FDC show a "good arguable case" of UK copyright and/or database right infringement in order to establish jurisdiction in the UK? On the basis of the evidence, he said "no": Sportradar had not done any act of reproduction (in respect of copyright) or extraction (in respect of database rights) in the UK. As for re-utilization in respect of database right, Article 7(2)(b) of the Database Directive stipulated that

Any form of making available to the public all or a substantial part of the contents of a database by the distribution of copies by renting, by on-line or other forms of transmission.

This raised a question of law of where the act of "making available" occurred. The issue was closely related if not identical to an issue raised on the amendment application of where "making available" occurred for the purpose of section 20 of the Copyright Designs and Patents Act 1988.  He had to face this issue since, where a question of whether the Court has jurisdiction turns on a pure question of law, that question has to be decided.

Referring by way of analogy to the debate as to where a "broadcast" occurred (was it at the place of transmission or also at the place of receipt?) he pointed to the Satellite Broadcasting and Cable Re-transmission for broadcasts orginating within the EU. Under that directive, a broadcast occurs where the signals are introduced under the control of the person making the broadcast into an uninterrupted chain of communication (the "emission theory"). Said Sportradar, the emission theory should equally apply to the making available right and to re-utilization, since the act which statute deems to be the infringement is a "making available" and the public do not have to actually access the database to infringe. The judge agreed: that right would prevent transmission or re-transmission in a state to which the Directive applies and other restricted acts would prevent further use of the database within the state of reception. He said:

"... the better view is that the act of making available to the public by online transmission is committed and committed only where the transmission takes place. It is true that the placing of data on a server in one state can make the data available to the public of another state but that does not mean that the party who has made the data available has committed the act of making available by transmission in the State of reception. I consider that the better construction of the provisions is that the act only occurs in the state of transmission".

Though the point was not acte clair, Floyd J felt that he could still rule on it and therefore decided not to refer the point to the Court of Justice of the European Union, particularly since the issue was not determinative of whether the court had jurisdiction at all. This was because he interpreted the Particulars of Claim as alleging acts of reproduction and extraction by Sportradar's end users in the UK who downloaded the data from the their servers. Although the customers/end users were not party to the proceedings, the pleadings alleged that Sportradar had authorised and/or was jointly liable for, the acts of the end users/consumers.  On this basis, the English court had jurisdiction to rule on whether Sportradar had authorised, or was jointly liable for, the acts of reproduction, extraction and re-utilisation of a substantial part of the Football Live database.

Turning then to FDC's application to amend its application, he felt that he could not allow any amendment which raised a new cause of action if it was already within the scope of the German proceedings.  He therefore allowed the amendments which gave further particulars of joint tortfeasorship by Sportradar and which pleaded communication to the public by its customers --  but not an amendment alleging making available by Sportradar itself under the Copyright Designs and Patents Act 1988, section 20.

The IPKat reminds readers that the battle has only just begun.  We can expect some stunning litigation before two of the best squads judicial brains in the European Champions League -- the British and the Germans -- and even the prospect of a replay or two at appellate level.

Sportradar here
Cat radar here
Bat radar here

This note was prepared with the assistance of a press release from Bird & Bird, who acted for Sportsradar in these proceedings.

Passing off and the CTM - three questions from Japan

The IPKat has been contacted by his learned friend Japanese attorney Masahiro Tomabechi with three detailed questions concerning "passing off" and Community trade marks.

Masahiro has spent the last few weeks on secondment in London to 'carefully and sincerely' study European and UK trade mark laws and he has clearly made good use of his time as his three questions below serve to prove. This Kat, herself originally coming from a non-Common Law jurisdiction, has given Masahiro answers to his questions but thought it would be so much more fun to see what our readers think the answers should be -- somewhat reminiscent of the old German saying that 'if you ask two lawyers the same question, you will at least get three different answers' ('yes', 'no', 'perhaps, but I have never seen it...'). Merpel, however, wonders whether the German Kat might perhaps not trust her own answers....

Please post your responses in the comment field below.

[Question 1]
In a case where a French company (hereinafter called “the proprietor”) owns a Community Trade Mark right, if the Community Trade Mark is threatened by infringement activities of a British company in the UK and then the proprietor sues before a CTM court in the UK, is it possible to claim the “Passing-Off” right together with the CTM’s right in order to prohibit the British company from using its mark in the UK?

[Question 2]
If the Community Trade Mark is threatened by the infringement activities of the British company not only in the UK but also in France and then the proprietor sues before the CTM court in the UK, is it possible to claim the “Passing-Off” right together with the CTM’s right in order to prohibit the British company from using its mark in France and the UK? That is, when the “Passing-Off” right is claimed together with the CTM right, is the “Passing-Off” right applicable in France as well as the UK, although France is not a common-law country?

[Question 3]
If the Community Trade Mark is threatened by infringement activities of a German company in the UK and then the proprietor sues before a CTM court in Germany, is it possible to claim the “passing-off” right together with the CTM’s right in order to prohibit the German company from using its mark in the UK? That is, does the German court have ability to examine the existence of the “Passing Off” right, although the “Passing Off” right is a right derived from the UK Common Law?

Cross faces at Crosstown as composers get their copyrights back

Here's a tricky case.  A couple of songwriters assign their copyrights to a company that is obliged to exploit those copyrights commercially.  The deal contains a clause that enables the songwriters to get their copyright back if the company is in material breach of its obligations.  The company then assigns the copyrights to another company, following which the songwriters want their copyright back. Do they get it? Yes, according to Crosstown Music Company v Rive Droite Music Ltd and others [2009] EWHC 600 (Ch), a decision of Mr Justice Mann (Chancery Division, England and Wales) on Wednesday,

Crosstown took an assignment of 119 copyrights owned by Rive Droite. Some of those copyrights related to songs written by Taylor and Barry, who assigned the copyright in their compositions to Rive Droite so that the latter could exploit the copyright and pay them royalties under an agreement which provided (in clause 18(a)) that, if Rive Droite were to be in material breach of its terms and failed to take all reasonable action to remedy that breach within 45 (in Taylor's case) or 60 (in Barry's case) days of written notification of a 'cure notice', the assigned copyright would revert to the writers.

Taylor and Barry later considered that a reversion-triggering breach had occurred, with the consequence they again owned the copyright in their various compositions. In April 2007 they served cure notices on Rive Droite, giving notice to Crosstown, relying on various alleged breaches -- including failure to cough up all the royalties on Cher's song Believe -- and asserting that they now owned thir copyrights again. Faced with those notices, Crosstown sued Rive Droite for specific performance of the sale agreement. Taylor and Barry counterclaimed for copyright infringement. The action involves determining (among other things) (i) whether the copyrights re-vested in Taylor and Barry; (ii) whether clause 18(a) bound the claimant as assignee of the copyrights and (iii) whether Taylor and Barry had lost any right to reversion of the copyrights through waiver, acquiescence or estoppel.

The main question before Mann J in these proceedings whether Taylor and Barry were correct in saying that there had been breach of clause 18(a). On a close analysis of the facts, he concluded that clause 18 provided for an automatic revesting of the copyrights, the cure notices were unassailable and that, therefore Crosstown's attack on their validity must fail. The judge discussed one legal issue of substantial interest: did clause 18 take effect differently in respect of different national copyrights? On that matter he had this to say:

"89.... I refuse to allow Crosstown to contend that the effect of clause 18 might be different in relation to different national copyrights. Although it might not be strictly relevant, I would add that this conclusion produces a much more satisfactory (if not conveniens) litigation picture, because if the position were otherwise the point might have to be determined in as many jurisdictions as there are copyrights in this case. I have not totted up the number of jurisdictions involved, but I think there are at least half a dozen if not twice that. That prospect is unsatisfactory. In the present case it is not appropriate to inflict that on the Writers. I reach the conclusion that I do without having to consider the strength of the submission that it would be wrong to assume that foreign copyright law is the same as English law. That submission would only become relevant if there were an issue as to different jurisdictions, and I have held that there is no such issue in this case because of the manner in which the case has proceeded hitherto. I also do not have to consider the extent to which foreign copyright issues can be litigated in this country (see, for example, Lucasfilms Inv v Ainsworth [noted here by the IPKat]), because again that only arises where there is a properly formulated issue as to the point, which again in this case there is not".

The IPKat wonders how many businesses taking assignments of copyright take the trouble to root around for clauses that may have the effect of undermining their commercial expectations, or whether they are merely happy to rely on warranties that their title will be secure.  Merpel moans, I still don't get it: if Crosstown has taken an assignment of the copyright from Rive Droite, surely Rive Droite doesn't have any copyright title to the works that can revert to the songwriters? Or have I missed something?

Three agreements -- but plenty of disagreement

Satyam Computer Services Ltd v Upaid Systems Ltd [2008] EWCA Civ 487 was heard by the Court of Appeal for England and Wales (Lords Justice Waller, Lawrence Collins and Rimer) on Friday of last week. You can read it in full here on BAILII. It's a case involving the construction of three IP contracts. Helpfully, the Court of Appeal has appended the text of all three of them to its BAILII transcript, so you can test your interpretational skills against those of the judiciary.

Upaid developed software and payment processing technologies. In about 1996, Upaid's founders developed the idea of converting any telephone into a de facto pay-phone through the use of a pre-paid account associated with a caller personal identification number (PIN). Opting to outsource its development, they identified Satyam -- an Indian IT company -- as being suitable to do that work. In May 1997 Upaid and Satyam concluded a short and relatively informal memorandum of understanding.

All went well till June 1998 when Upaid, seeking a US patent, had to demonstrate 'unity of ownership' of the intellectual property rights in its invention. This meant that Satyam would have to assign any rights in the work to Upaid. In fact Satyam normally did this -- but the memorandum of understanding said nothing about it having to do so. Following three months of negotiation the parties entered into an assignment agreement, under which all Satyam's IP would be transferred to Upaid in return for a cash payment. The assignment agreement also referred to a service agreement which, as it turned out, was not concluded until May of the following year. Under the service agreement Satyam would pick a dedicated team to work exclusively on Upaid's projects.

By 2002 the relationship had deteriorated. Upaid complained about Satyam's work. Satyam complained at not being paid and said that the IP rights reverted to it. Upaid said Saytam was infringing its IP rights. At the end of that year the parties struck a settlement agreement, this being subject to the exclusive jurisdiction of the English courts. In June 2005 Upaid commenced patent infringement proceedings in Texas against two third parties and sought Satyam's assistance, which was fothcoming. Having settled that action on unfavourable terms, Upaid then applied to the Texas courts for a declaration of validity of its patents, damages for Satyam's alleged fraud in providing Upaid with forged documents in the earlier Texas proceedings, plus damages for an alleged breach of the assignment agreement back in 1999.

In these English proceedings Satyam argued that either (i) Upaid's claims against it in Texas had been brought in breach of the settlement agreement, which compromised all such claims, or (ii) the exclusive jurisdiction clause in the settlement agreement required the claims to be brought in England.


Right: latest products from the Catphone Warehouse ...


Flaux J had to rule in this instance on three issues: (i) which, if any, of Upaid's claims had been finally compromised by the settlement agreement; (ii) did any (and, if so, which) claim fall within the scope of the English jurisdiction clause contained in the settlement agreement and (iii) was Satyam entitled to a final injunction?

Flaux J (whose decision this January was noted by the IPKat here) refused injunctive relief. On its true construction the settlement agreement did not deprive Upaid of the future right to claim damages for breach of the assignment agreement or for alleged fraud in relation to documentation produced pursuant to that agreement. Nor was there anything in the relevant agreements that required these actions to be pursued in England.

On Friday the Court of Appeal dismissed Satyam's appeal. It agreed with Flaux J's construction of the agreements. The settlement agreement did not supersede the assignment agreement: Upaid retained all relevant intellectual property; the assignments continued to apply in accordance with their terms. Claims under the assignment agreement were governed by that agreement and not by the settlement agreement.

The IPKat notes that Lord Justice Lawrence Collins, delivering the main judgment, felt that this case was somewhat orver-argued. He said (at para.2):

"The case was most elaborately argued before the judge and before this court, with an attention to the linguistic detail of the agreements more appropriate to the interpretation of tax legislation which has received close scrutiny at all committee stages than to the interpretation of commercial contracts. The main points of interpretation on this appeal depend primarily on the ascertainment of the commercial purpose of the agreements in the light of the commercial and factual background".

In other words, what were the parties trying to do -- not what was the meaning of the words by means of which the parties expressed their intentions? Merpel mourns the fact that this dispute has run up as far as the Court of Appeal on a dispute as to the resolution of preliminary issues, five and a half years after the parties reached a settlement agreement. Surely there must be better ways than this to lubricate the friction of a commercial relationship.

Payphones here
The Payphone Project here

More patent money wasted on fighting over where to sue

In "a judgment of the Court to which all members [Lords Justices Mummery and Jacob and Mr Justice Mann] have contributed", the Court of Appeal handed down its decision yesterday in Research In Motion UK Ltd v Visto Corporation [2008] EWCA Civ 153, which you can read in full on BAILII.

Right: this neat little device has been specially programmed to guide judges as to whether to hear an action or stay proceedings

RIM started revocation proceedings against the UK part of Visto's European patent in an English court, together with an action for a declaration of non-infringement, excluding a particular aspect of some embodiments of its product. RIM later commenced proceedings in Italy, seeking revocation of the corresponding Italian patent and a declaration of non-infringement of not only the Italian bit of patent but also the corresponding German, French, Spanish, Dutch and Belgian patents. Visto served a defence and counterclaim in the English non-infringement action. The counterclaim covered more than the issue of (non)infringement alone, claiming that RIM was committing an abuse of the process of either the Italian or English court, in that RIM had started the Italian action seeking relief in respect of countries other than Italy with the specific objective of heading off any infringement action that might be taken in those countries. If RIM genuinely wanted such claims determined expeditiously, said Visto, it could have brought them in the English proceedings.

After RIM said it would give an undertaking to discontinue the English non-infringement action, the English court declined jurisdiction and stayed Visto's counterclaim on the ground that the counterclaim and the Italian proceedings were related proceedings, in respect of which the Italian court was the court first seised under Regulation 44/2001 on jurisdiction and the recognition and enforcement of judgments in civil and commercial matters, Article 28. Visto appealed and argued that, before discontinuance, the English action (including the defence and counterclaim) and the Italian proceedings were related proceedings within Article 28. Since the English action was the first in time, if there had been no discontinuance there should be no stay.

The Court of Appeal dismissed Visto's appeal. In its view

* the English and Italian proceedings were not related within the meaning of the Regulation.

* in ascertaining whether proceedings were related, the court could look beyond the claim documents and into the defences. In this case the defence relied on post-claim matters -- the commencement of the Italian proceedings. However, although the test of first seisin was largely mechanical, the application of Article 28 required an assessment of the degree of connection, and then a value judgment as to the expediency of hearing the two actions together in order to avoid the risk of inconsistent judgments.

* the mere fact that different courts might deliver inconsistent judgments did not of itself mean that proceedings were inevitably related. Article 28 left it open to acknowledge a connection, or a risk of inconsistent judgments, while still concluding that the connection was insufficiently close, or that the risk was not sufficiently great, to make the actions related for the purposes of the Article.

* the English proceedings, in substance, were for a declaration concerning an English patent and a particular product. The substance of the Italian proceedings was other designations, but not focusing on the same product. The abuse of Italian process was the only link between them and it was only in relation to that point that there was a risk of inconsistent judgments.

* Article 28(3) did not require the court to find that any possibility, no matter how small the point, required the conclusion that the actions were related.

The IPKat notes the observation of the court at paragraph 3 that

"The case is yet another illustrating the unsatisfactory state of the current arrangements for deciding European wide patent disputes. Too often one finds parties litigating as much about where and when disputes should be heard and decided as about the real underlying dispute".

The same problem exists for trade marks and designs, but the frequency with which jurisdictional tussles and applications for stays occur seems to the IPKat to be very much lower. Does anyone know why? Merpel is disappointed that the English courts won't have a chance, at least this time, to rule on whether there had been an abuse of process in bringing the action in Italy. That would have been fun.

For other litigation between the same parties, see the IPKat's notes here and here

The Knorr, the merrier

Another decision that nearly slipped beneath the IPKat's whiskers for good was Knorr-Bremse Systems for Commercial Vehicles Ltd v Haldex Brake Products GmbH [2008] EWHC 156 (Pat), a ruling of England and Wales Patents Court judge Mr Justice Lewison (full text available on BAILII).

Knorr, an English wholly-owned subsidiary of a German company, was part of a group of companies that manufactured brake systems -- as did a German company, Haldex. Knorr's parent company had developed a valve which, said Haldex, infringed its European patent. Haldex began infringement proceedings in Germany, where Knorr's parent proposed to initiate invalidity proceedings against the European patent's German emanation. The dispute was settled by an agreement that conferred jurisdiction on the patent disputes division of the Dusseldorf (Germany) regional court. Under this agreement Knorr's parent promised not to challenge the validity of Haldex's patents.

Knorr subsequently developed a new valve, which was to be made in the UK for the British market. To be on the safe side, Knorr sought an acknowledgement of non-infringement from Haldex and, on receiving none, applied for a declaration of non-infringement. According to Knorr, both the fact of the jurisdiction agreement and its content, and in particular the question whether it bound Knorr as a subsidiary of its parent, had to be determined under Council Regulation 44/2001 (the Judgments Regulation). Haldex disagreed. In its opinion, once the existence of a jurisdiction clause was established as a matter of the autonomous law of the Regulation, its scope -- and in particular the question who was bound by it -- was to be determined by the applicable national law, which in this case was German law.

Lewison J chose to keep the litigation in England. In his opinion:

* Whether Knorr was bound by the jurisdiction clause was governed by the Regulation, not by German law (applying the fairly obscure and oft-forgotten ECJ ruling in Case C-269/95 Benincasa v Dentalkit).

* Knorr was not itself a party to the settlement agreement, nor was it even suggested that it was a successor to the rights and obligations of its parent.

* The argument that Knorr was bound by the jurisdiction clause was itself based entirely on principles of German law, which was not, so far as British law was concerned, applicable in this case.

* Even if German law were the applicable law, Knorr was still not bound by the settlement agreement.

The IPKat says, the most interesting part of this case is the judge's comments on the effect of the no-challenge clause by which Knorr's parent promised not to attack the validity of Haldex's patents. He said:

"49 In Bayer AG and Maschinenfabrik Hennecke GmbH v. Süllhöfer [1990] F.S.R. 300 the ECJ held that it made no difference that the non-challenge clause was contained in an agreement settling litigation. The court said:

"[14] In the Commission's view, an undertaking not to challenge an industrial property right included in a licensing agreement should, in principle, be considered to be a restriction of competition. Such a clause is, however, compatible with Article 85(1) of the EEC Treaty when it is included in an agreement whose purpose is to put an end to proceedings pending before a court, provided that the existence of the industrial property right which is the subject-matter of the dispute is genuinely in doubt, that the agreement includes no other clauses restricting competition, and that the no-challenge clause relates to the right in issue.

[15] The point of view put forward by the Commission cannot be accepted. In its prohibition of certain agreements between undertakings, Article 85(1) makes no distinction between agreements whose purpose is to put an end to litigation and those concluded with other aims in mind. It should also be noted that this assessment of such a settlement is without prejudice to the question whether, and to what extent, a judicial settlement reached before a national court which constitutes a judicial act may be invalid for breach of Community competition rules.

[16] A no-challenge clause included in a patent licensing agreement may, in the light of the legal and economic context, restrict competition within the meaning of Article 85(1) of the EEC Treaty.

[17] In regard to that context, it should be pointed out that there is no restriction on competition when the licence granted is a free licence in as much as, in those circumstances, the licensee does not suffer from the competitive disadvantage involved in the payment of royalties.

[18] Nor does a no-challenge clause contained in a licence granted subject to payment of royalties restrict competition when the licence relates to a technically outdated process which the licensee undertaking did not use."

In the present case it is common ground that both KBS and Haldex are part of an oligopoly in the field of braking systems for commercial vehicles and that their trade is conducted throughout the EU. On the face of it, therefore, a non-challenge clause is likely to distort competition and affect trade between member states. There is no question in the present case of a free licence. Nor is it possible to say that the technology in question is outdated, since Haldex relies on the two patents as preventing the commercialisation of the SV3801 valve.

I do not have to decide whether KBS UK are right in their contentions, but I do consider that they have the better of the argument. There is at the least a good arguable case that, even if KBS UK are bound by the non-challenge clause (which in my judgment they are not) that clause is void because it contravenes article 81 EC. "

Merpel says, the principle that a contested IP right will not be challenged is one that is often implied or, more frequently expressed, in settlement agreements. But it is really necessary to look behind the form of the agreement and consider the genuine substance of the dispute. The validity of a patent is routinely called into question by an alleged infringer, but that may be as much for strategic or nuisance value in the litigation as because there is any serious risk of the patent being invalid. It would be harsh if a clause that was designed to make peace between parties on the infringement issue were to have serious consequences in terms of EU and national competition law. Tufty says: well, if the validity of the patent wasn't really an issue in the first place, there's no harm in saying that the alleged infringer remains free to challenge it, is there?

How brakes work here

How agreements lead to disagreements; Schlumming it

Mr Justice Flaux is not a judge known to the IPKat, but he popped up in a recent IP-related dispute before the Commercial Court for England and Wales in Satyam Computer Services Ltd v Upaid Systems Ltd [2008] EWHC 31 (Comm) in which he gave judgment yesterday. You can read it in full here on BAILII.

Upaid developed software and payment processing technologies. In about 1996, Upaid's founders developed the idea of converting any telephone into a de facto pay-phone through the use of a pre-paid account associated with a caller personal identification number (PIN). Opting to outsource its development, they identified Satyam -- an Indian IT company -- as being suitable to do that work. In May 1997 Upaid and Satyam concluded a short and relatively informal memorandum of understanding.

All went well till June 1998 when Upaid, seeking a US patent, had to demonstrate 'unity of ownership' of the intellectual property rights in its invention. This meant that Satyam would have to assign any rights in the work to Upaid. In fact Satyam normally did this -- but the memorandum of understanding said nothing about it having to do so. Following three months of negotiation the parties entered into an assignment agreement, under which all Satyam's IP would be transferred to Upaid in return for a cash payment. The assignment agreement also referred to a service agreement which, as it turned out, was not concluded until May of the following year. Under the service agreement Satyam would pick a dedicated team to work exclusively on Upaid's projects.

By 2002 the relationship had deteriorated. Upaid complained about Satyam's work. Satyam complained at not being paid and said that the IP rights reverted to it. Upaid said Saytam was infringing its IP rights etc etc etc... Fortunately, at the end of that year the parties struck a settlement agreement, this being subject to the exclusive jurisdiction of the English courts. In June 2005 Upaid commenced patent infringement proceedings in Texas against two third parties and sought Satyam's assistance, which was fothcoming. Having settled that action on unfavourable terms, Upaid then applied to the Texas courts for a declaration of validity of its patents, damages for Satyam's alleged fraud in providing Upaid with forged documents in the earlier Texas proceedings, plus damages for an alleged breach of the assignment agreement back in 1999.

In these English proceedings Satyam argued that either (i) Upaid's claims against it in Texas had been brought in breach of the settlement agreement, which compromised all such claims, or (ii) the exclusive jurisdiction clause in the settlement agreement required the claims to be brought in England. Flaux J had to rule in this instance on three issues: (i) which, if any, of Upaid's claims had been finally compromised by the settlement agreement; (ii) did any (and, if so, which) claim fall within the scope of the English jurisdiction clause contained in the settlement agreement and (iii) was Satyam entitled to a final injunction?

Flaux J refused injunctive relief and ruled that, on its true construction, the settlement agreement did not deprive Upaid of the future right to claim damages for breach of the assignment agreement or for alleged fraud in relation to documentation produced pursuant to that agreement. Nor was there anything in the relevant agreements that required these actions to be pursued in England.

Says the IPKat, it's the same old story. If more attention had been paid to the conversion of the parties' shared understanding at the very beginning into a cohesive form of words, there would have been no need for the assignment agreement which contained the service agreement which led to the settlement agreement which led to a four-day hearing in the High Court. Merpel agrees, adding "It's much easier to settle disputes before they have arisen and when the parties are still fond of each other, rather than trying to hit upon the commercial and legal means of bridging an ever-widening gap between them after the relationship has gone sour". Tufty adds: "I can't help it: I just keep reading the name 'Upaid' as 'Unpaid'".


A more familiar judicial name in patent circles is that of Mr Justice Floyd, who gave a ruling yesterday in Schlumberger Holdings Ltd v Electromagnetic Geoservices ASA, an application to the Patents Court for England and Wales for the disclosure of documents relating to an invalidity action. The IPKat found this on LexisNexis Butterworths' subscription-only service but (as yet) nowhere else.

Schlumberger was the holding company for other companies which comprised the world's largest oilfield services operation, covering some 80 countries. EG filed for three patents relating to controlled sonar electromagnetic surveying equipment that could be used when detecting subterranean reservoirs. It was expected that such technology would become a key part of the future of surveying and, over a period of years, revenue deriving from such technology would reach $1 billion a year. Before EG's patents came along, Schlumberger had expressed no interest in investigating EG's technologies but, once it spotted EG's patents, Schlumberger sought to have them declared invalid on the ground that they lacked an inventive step. After EG sought disclosure of documents from Schlumberger and its group on which it based its contention that its patents were obvious, Schlumberger disclosed a single document relating to documents it held but added that it had no obligation to supply documents of relevance held by companies within the group, since the duty to disclose was limited to documents that were, or had been, in its control. EG was not happy about this, to put it mildly, and sought the wider disclosure.

Floyd J allowed EG's application. In his view, on the evidence the relevant documents had been within the control of Schlumberger and it could be considered that Schlumberger had the general consent of the companies within its group. Further, such documents would be of relevance to the parties in the case.

Says the IPKat, without being in possession of the facts and without having seen the decision it is unwise to comment, but it's difficult to see how Schlumberger could have seriously expected the court to rule in its favour on this point. Any billion-dollar business is entitled to spend its money as it pleases, but this looks like a waste of money for the sake of spite, in order to cause inconvenience and annoyance for its own sake.

Background to Schlumberger here. Little-known fact: the company was founded by a pair of Alsatians.