CIPA York Meeting

Brighter Days in York?

(c) 2016 Jane Lamber: all rights reserved

Last Thursday I was one of the speakers at the York meeting of the Chartered Institute of Patent Attorneys ("CIPA"). The other speakers were Louise Edwards of Mazars, David Bloom of Safeguard IP and Kalim Yasseen who is a patent examiner with the Intellectual Property Office. CIPA's president, Tony Rollins, chaired the meeting.

I spoke about IP Litigation after Brexit.  Although we Brits tend to be seen as the awkward squad when it comes to the European project there has been one initiative upon which we have been commendably communautaire. That initiative has been a single European patent for all the member states of the European Union with a single court for the resolution of disputes relating to such patents. The reason why we have always supported that initiative is that patent enforcement litigation in the UK is the most expensive in Europe. The cost of enforcement probably has a lot to do with why the UK trails not just Germany and France in the number of European patent applications but also Switzerland with one eighth of our population and the Netherlands with one third. Something that I have been saying for most of the last 10 years (see Why IP Yorkshire 10 Sept 2008),

The Uniform Patent Court, which will probably come into being towards the end of this year or the beginning of next, would have put British industry on a level playing field with its continental competitors. Unfortunately, the chances are that we shall have to leave when we quit the EU. After we go it will be even more important to do something about reducing the cost of IP litigation in the UK. One solution will be to make better use of the Intellectual Property Enterprise Court ("IPEC") and, in particular, its small claims track. Another consequence of Brexit is that we shall be looking for new export markets outside Europe where the IP environment will be quite different. Not all those markets protect intellectual assets adequately and I suggest that the UK's bilateral investment treaties with 117 foreign states might help. I discussed all these items in greater detail in IP Litigation after Brexit 9 April 2017 IP North West).

Louise gave is a Patent Box Update in which she discussed the effects of the Finance Act 2016 and proposed Finance Bill and considered a number of case studies. She covered some of the rules on patent box relief contained in the 2016 Act and gave us some statistics on take-up. There were apparently 55 companies that took advantage of the scheme in North West England but rather more in Yorkshire. She mentioned the base erosion and profit shifting project of the OECD and how it will affect IP and in particular licensing and distribution. Finally, Louse spoke about three cases that were on her desk right now. One concerned an "ideas company" and its licensing activities. Another, a patentee who had found a new use for his (or her) invention. Finally, a "serial inventor" who insisted on holding onto his IP even though it was not at all tax efficient.

Louise illustrated her talk with bear traps, signposts to "opportunities" and gold nuggets of which there were many. She also had a short sighted computer literate bespectacled terrier under the caption "No tax tail wagging me!" A useful reminder that tax schemes with the primary purpose of avoiding tax will not be bought by HMRC or, for that matter, the courts.

David spoke about IP insurance which is a topic very dear to my heart. I have written quite a lot of articles about it over the years, the last being IP Insurance: CIPA's Paper 1 May 2017 NIPC Inventors' Club. In my view, there is no point in spending a lot of money on obtaining a patent unless you are prepared to enforce it. Despite IPEC and the UPC which I mentioned in my paper it still costs an arm and a leg to enforce an IP right in England. IP insurance can help with that and David said that the choice of insurance products was going up and the cost of premiums was going down. At one time, patent agents used to warn their clients not to waste their money on insurance. I am glad to say that I don't think they do that anything like as much nowadays. If I were a patent or trade mark attorney I would make all my clients aware of such things as IP insurance and watch services and point them in the direction of someone who could give them some dispassionate advice and information.

Kalim, whom I had met when he gave a super talk to the Sheffield inventors club entitled "Filing a UK patent application - process and procedures" on 6 Feb 2012, discussed changes to the Patents Rules 2007 some of which were coming into effect that very day (see Changes to Patents Rules on 1 October 2016 and 6 April 2017 1 Sept 2016 IPO website). These included "omnibus claims" - not an application for a patent for a new kind of charabanc but a basic repetition of the description in the specification - and the communication of patent renewal reminders. Some of these new rules such as the examiner's notification of intention to grant seem to me to be very useful and most have actually been in force since October.

Kalim also spoke about changes to the IPO's portion of the .gov.uk website which seems to reinstate some of the useful bits of the old professional pages section of the IPO's old website. One useful feature is password protected access to the examiner's file. Another is the updating of the Manual of Patent Practice.

Finally, Kalim gave us some tips on working with your examiner. He assured us that he and his colleagues were quite approachable and perfectly reasonable but there are some things that get their goats of which we should be aware. Fairly common sense things in my view.

The meeting took place in the Principal Hotel next to the station. It seems to have undergone considerable renovation and refurbishment. It was much smarter than it was when I last visited it. They laid on a hot and cold buffet with soft drinks for lunch, tea and coffee at half time and gallons of prosecco for those who did not have to drive. Patent seekers generously added some Welsh whisky, easter eggs and chocolate bunnies to the festivities and we were well away. As I was precluded from partaking in the whisky, I was tempted to mention Mr Justice Laddie's decision in Matthew Gloag and Son Ltd and Another v Welsh Distillers Ltd and Others: The Runes 27 Feb 1998 but thought better of it.

In-house IP Training

View of Huddersfield

Photo Wikipedia

Yesterday lunch time I visited a business in Huddersfield to talk to its staff about intellectual property ("IP"). An incident had occurred some months ago when it would have been to their advantage to have known more about IP. Sensibly the company's managing director sought training for its employees and asked a local business advisor to help. The advisor made enquiries at a neighbouring law school but their IP specialist could not assist so the advisor approached me.

That is the sort of invitation I am always happy to accept. As I explained in IP Services from Barristers 6 Apr 2013 4-5 IP:

"It is now permissible for members of the public to consult barristers directly under the Public Access scheme and there are sometimes advantages in doing so, especially in respect of intellectual property. Because we are independent and objective we can advise on the optimum legal protection for a new product or business. For instance, the instinct of a patent attorney is to recommend patent protection for a new invention and in as many countries as possible. Often, that is the best advice but when the inventor is an individual, start-up or small business more nuanced advice is required."

A barrister's job is to obtain the best legal outcome for his or her client and not simply to represent them effectively in court though of course we do that as well. Because we see a lot of disputes we can often spot pitfalls well in advance and advise on how to avoid them. And that is just what I did yesterday.

I was led into a conference room where a table was set up for lunch.  There were different types of bread, cold ham and chicken, fresh fruit salad, profiteroles and a chocolate Yule log. The managing director introduced the trainees, offered us tea and coffee and invited us to tuck in. There were four trainees.  All were women. They were all very bright and it became clear from the conversation that they all had substantial business experience. Each of those ladies had prepared a list of questions and they took it in turns to quiz me.

The first question was on artwork. They were often asked to do artwork for customers who later used it for purposes for which it was not intended. The customers thought they could do what they wanted with the art work just because they had paid a fee. The question boiled down to "who owns the copyright and what licences (if any) are granted or retained?" I referred the ladies to the Copyright, Designs and Patents Act 1988 and in particular to s.11:

"First ownership of copyright
(1) The author of a work is the first owner of any copyright in it, subject to the following provisions.
(2) Where a literary, dramatic, musical or artistic work, or a film, is made by an employee in the course of his employment, his employer is the first owner of any copyright in the work subject to any agreement to the contrary.
(3) This section does not apply to Crown copyright or Parliamentary copyright (see sections 163 and 165) or to copyright which subsists by virtue of section 168 (copyright of certain international organisations)."

Their company owned the copyright in any art work that they produced subject to any contract that the company may have made with its customer. That could depend on their company's terms and conditions or on those of their customer. I asked what the company's terms and conditions said about ownership of copyright in its employees' artwork. I was told that there were no terms and conditions. I replied that they should consider getting a lawyer or patent or trade mark agent to draft some for them.

One of the ladies asked whether it might be to their company's advantage "not to have a contract". I responded that they did have a contract but not a written one. In  a dispute over title to copyright in the artwork a judge and lawyers would scour the party to party correspondence, minutes and memos of meetings, previous dealings between the parties and what was normally done in transactions of that kind by other businesses in the industry. All that could take time and cost money and lead to a lot of uncertainty. Much if not all of that could be avoided by adopting a simple set of terms and conditions.

The next question was on artwork for quotations. Sometimes a customer asked them to prepare a quote which might involve quite a lot of work. The customer might reject the quote and take the work to a competitor who could undercut them.  I told them that had actually happened in Pensher Security Door Co. Ltd v Sunderland City Council [2000] R.P.C. 249 and that the Court of Appeal had held that the customer had infringed copyright by taking the design to another company and ordering goods from them.

They asked me how much it would cost for a lawyer or attorney to draft terms and conditions and I replied that it would be between £500 and £750 plus VAT. There was a collective intake of breath around the table suggesting that they thought it was a little on the high side. I decided to discuss the alternatives. "Some companies" I said "simply look at their competitors' websites and lift the legals from them. But that is a mistake for two reasons. First, copyright is likely to subsist in the terms and conditions just as it does in any other kind of work so copying the T & C even with a few changes here and there amounted to copyright infringement for which the copyist might be sued either by the person who drafted the terms or his client. Secondly, terms and conditions are intended to manage risk and the risks of the competing company might not be the same as the company's. It was like wearing another person's clothes. They might cover the body up to a point but they would not fit snugly or look very good."

I pointed out that terms and conditions are rather like the fortifications of Sandal Castle or some other medieval fortress. The first line of defence was the moat which kept out most of the undesirables of medieval Yorkshire such as waifs and strays, thieves and vagabonds, sturdy beggars and wild animals. In a company the moat corresponded to best practice. The next line of defence was the curtain wall from which defenders could rain down arrows, boiling oil and molten lead on more determined invaders. That defence corresponded to insurance. The last line of defence was the keep or bailey and if an invader got that far he had come a long way. That was where the hand to hand fighting might take place such as Macbeth against McDuff. The keep was like terms and conditions. They were for situations where best practice had failed and there was no insurance cover. The T & C had to be integrated with the insurance cover and best practice and that was where the work was to be done. When they considered that the cost of a law suit might run into the hundreds of thousands or even millions the ladies agreed that £500 to £750 was very good value.

We talked about IP insurance and I warned the ladies that many legal expenses insurance specifically exclude IP disputes. I advised them to check the company's policy and consider obtaining additional cover unless they were confident that they could fund any infringement claims that they might wish to bring or defend any revocation or invalidity claims that others might bring against them. They asked about the costs of litigation and I told them all about the Chancery Division and the chancery county courts, the Patents Court, IPEC including its small claims track and other options such as the IPO hearing officers, IPO examiners' opinions, domain name dispute resolution services and various mediation services. One of the ladies asked me to explain the difference between patents and copyrights which led to a discussion on intellectual assets and the different forms of legal protection. Another asked about IP protection abroad and I told them about TRIPs and the international conventions.

I had been booked for an hour but the session lasted nearly double that time. None of us was looking at the clock. The conversation was lively and stimulating and I think we all enjoyed ourselves.  If any other business, law firm or patent or trade mark agency in Yorkshire or indeed anywhere else wants me or one of my colleagues to lead a similar discussion he or she need only ask. I would normally charge about £350 + VAT for a session of this kind but as the initial enquiry had come through a connection who had recommended me in the past I did it for free.

If anyone wants to discuss this article or IP law generally he or she should call me on 020 7404 5252 during office hours or use my contact form.

Finally, I should like to wish all my readers a very happy New Year.

CPD Event - "The Intellectual Property Act 2014 - What it means for you and your clients" Leeds 15 Oct 2014

Jane Lambert

On 14 May 2014 the Intellectual Property Bill received royal assent and became an Act. It implements several of Prof Hargreaves's recommendations including implementation of the Council Agreement on the Unified Patent Court, accession to the Hague Agreement and enhancement of the examiner's opinion service for patents and its extension to designs. More controversially it creates for the first time an offence of intentionally copying a registered or registered Community design.  My colleague Alex Rozycki and I gave a presentation on the new Act on the 19 May 2014. I also write my Reflections on the Intellectual Property Act 2014 in our IP and Tech law blog as well as detailed analyses on the effect of the Act on patent, registered designs and unregistered design right law.

There have been two important developments since them. The first is that Lady Neville-Rolfe, the Minister for Intellectual Property, has signed The Intellectual Property Act 2014 (Commencement No. 3 and Transitional Provisions) Order 2014 which brings many of the key provisions of the Act into force on 1 Oct 2014. The second (and potentially the more important) is the consultation on the Unified Patent Court which has just closed.

I shall be discussing those developments and much more besides in a talk that I am giving at the Leeds Business and IP Centre on the 15 Oct 2014 at 18:00 as part of Leeds Business Week. This is an in-depth seminar which should be of interest to specialist IP lawyers and patent and trade mark attorneys for which we plan to give SRA, BSB and, if it can be arranged in time, IPReg points. However, it will also be useful for business owners and managers of all descriptions in all industries as well as artists, designers, inventors and investors in start-ups and other high tech businesses.

Space is limited but you can reserve your place now by calling my clerk, George, on 01484 599090 or 020 7404 5252 or sending him a message through his contact form. I look forward to seeing you there.