Understanding Intellectual Property Rights

Anyone involved in software development today must have a keen understanding of the ins and outs of intellectual property rights, including copyright laws and patent development. But the area is so vast that it can be difficult to narrow down the most important points to start with.

Here we’ll outline five key areas that developers and others in the software industry should have a clear understanding of. This list may be especially useful for independent entrepreneurs who are focused on developing their own products or who are newcomers to the tech industry in general.

1. Trademarks

Trademarks protect your name, domain, images, and everything related to product design. You must register your trademark to ensure full and complete legal protection of your brand.

Quite simply, anyone who develops a piece of software should put in place the protection mechanisms that will solidly protect your brand name even before they go into the development process and especially before they partner with anyone else.

It’s important that software developers have a contemporary understanding of how trademarks work— not only to protect themselves but also to be aware of the rights and responsibilities of others that you may end up working with.

2. Open Source Agreements

One of the areas that can get particularly sticky when it comes to intellectual property is in the realm of purposefully shareable intellectual property like open source code. The main thing to know is that this type of software is actually copyrighted and developers are required to use it in accordance with specific licensing.

If a developer releases the finished work as open-source, there are different types of open source licenses, which the developer should be familiar with ahead of time. Depending on the license, there will be different permissions granted to the users of the software. However, developers that are creating software programs with the intention of having it end up as a part of an open source platform don’t need to abide by licensing rules.

3. Author Versus Owner

Ownership determination can be complex and especially in the case of open source software. However, in terms of employee-employer relationships, so long as someone is an employee, anything that they develop is not their own – the employer will always have the copyright, and this is the case no matter what role the developer plays in the development process.

If the developer is an independent contractor, they may be considered the owner unless there is a legally binding contract outlining other terms.

4. Trade Secrets

It may seem unethical to some who are focused on knowledge-sharing for the benefit of innovation to keep things a secret but sometimes it’s necessary since other forms of copyright will be both public and have certain limitations.

If a developer finds themselves with a highly original and valuable idea, it may be that they want to keep it a secret in order to maintain full control over the source code without risk of anyone copying it. A protection program will include confidentiality agreements, password protection and the like.

Trade secrets can be kept in perpetuity, but they do require that extensive steps be taken to ensure privacy – which of course gets more complicated depending on the size of a team.

5. Patents

A patent typically is in place for 20 years. Developers can get patents on software, but only if the invention is extremely original – in the software space this will pertain to the software itself (e.g., applications) and/or the algorithm incorporated in the design. Patents also require that you make the details of your invention public.

In Conclusion

All developers need to have a clear understanding of their rights in relation to any partnership employment scenario before they actually enter into a work agreement or even start developing their own unique product line.

https://www.lianapress.hk/releases/biotech/5-things-every-developer-must-know-about-intellectual-property-rights.html

Parallel import issues under Indian trademark law

Parallel importation is a complex and often disputed issue in the IP field. ‘Parallel imports’ are genuine goods that are legitimately acquired from the rights holder and subsequently sold at lower prices through unauthorised trade channels in the same or a different market.

As parallel importation is essentially a trade practice, it is regulated under both IP law and competition law. In the trademark law context, parallel importation significantly affects the rights of a manufacturer or trader, as trademarks help traders to earn goodwill in the market and to protect their commercial reputation. As territorial rights, trademarks also indicate the source of the trademarked products or services. A conflict therefore arises when parallel importation results in a misrepresentation of the source, reputation or quality of the trademarked goods.

There is no dispute that parallel importers are in business to make money. Parallel importation occurs due to price differentials caused by currency rate fluctuations and tax differentials in different markets. This allows goods to be resold at a profit by a third party in a more expensive market. Actions to prevent parallel imports under trademark law include suits for passing off and/or infringement.

Parallel imports are also referred to as ‘grey-market’ goods because although the goods may be genuine, they are sold through unauthorised trade channels. The Indian judiciary has recently attempted to clarify this ‘grey’ area.

Law on parallel imports

In India, parallel importation is intricately linked to the principle of exhaustion of rights under the Trademarks Act, 1999. The principle of exhaustion of rights is enshrined in Article 6 of the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs), which states that “nothing in this Agreement shall be used to address the issue of the exhaustion of intellectual property rights”. Hence, each state is entitled either to prohibit or to allow parallel imports within its own legal framework.

Two major issues that are often discussed in the context of parallel importation and trademarks in India are whether parallel importation constitutes infringement under Section 29 of the Trademarks Act and whether India recognises the principle of international exhaustion of rights under Section 30 of the Trademarks Act.

Case law

One of the first cases concerning parallel importation and trademark law in India was Cisco Technologies v Shrikanth 2006 (31) PTC 538, in which the Delhi High Court granted an ex parte injunction in favour of the plaintiff and restrained the defendant from importing computer hardware and hardware components under the trademark CISCO (which was registered in India). The plaintiff argued that:

CISCO products such as routers and switches are mission and human critical hardware components used in network infrastructure; that the product of the Plaintiff is used in critical networks such as railways, air-traffic control, hospitals, air defenses etc.; that malfunctioning/failure of the product of the Plaintiff would result in huge losses due to failure of these networks; that keeping in view the critical importance of the product in question, it becomes imperative to ensure that neither counterfeit sales nor sales by misrepresentation take place… and that public interest has to be kept in mind while determining the issue whether ex-pare ad interim relief should flow to the Plaintiff at this stage.

In accepting the plaintiff’s arguments, the court also observed that:

It is the obligation of all statutory and governmental authorities to ensure that laws are not violated by any person in this country. For persons who hold benefit of registered trademarks, Section 140 of the Trade Mark Act, 1999 makes statutory provisions whereunder the Collector of Customs could prohibit the importation of goods if the import thereof would infringe Section 29(vi)(c) of the Trade Marks Act. I see no reason why the statutory authorities should not prohibit import of such products, import whereof would result or abet in the violation of the proprietary interest of a person in a trademark/trade name.

The court also issued directions to Customs to notify at all ports that no consignments, other than those of the plaintiff, should be permitted to be imported in respect of routers, switches or cards bearing the CISCO trademark and/or the bridge device.

The Indian courts will usually grant an injunction against parallel importers only if the nature or quality of the goods has been changed or impaired after they have been put on the market. For instance, in Samsung Electronics Co Ltd v Mr G Choudhary, 2006 (33) PTC 425, Samsung argued that the sale of parallel-imported ink cartridges and toners did not strictly conform to Indian laws and regulations (eg, they were not accompanied by literature in English or the vernacular, and/or a label indicating the maximum retail price; they were not covered by a warranty; and use of the products would likely breach the warranty of the printer in which they were used). The Delhi High Court restrained the defendant from dealing directly or indirectly in those products.

In M/S General Electric Company v Altamas Khan General Electric argued, among other things, that the defendants’ import of its genuine products into a territory for which they were not intended violated its trademark and caused it loss. It further argued that the illegal sale caused it loss of reputation, insofar as purchasers that were unable to claim warranty or avail of an aftercare service would likely blame it or hold it responsible. The Delhi High Court found the defendants liable for infringement.

In Kapil Wadhva v Samsung Electronics, 2013 (53) PTC112, the Delhi High Court Division Bench reinforced the legality of parallel imports and held that the Trademarks Act enshrines the principle of international exhaustion of rights. In other words, it held that the exclusive right of a trademark owner over its goods is exhausted once the goods have been put on the market either by the trademark owner or with its consent. The court held, among other things, that the word ‘market’ used in the statute implies a global market, and that the preparatory works to the Trademark Bill 1999 clearly indicate the intent of the legislature to recognise the principle of international exhaustion of rights to control further sales of the goods once they have been put on the market by the trademark owner.

To illustrate: where a third party acquires goods legitimately from the trademark owner in country X, which follows the principle of international exhaustion of rights, and subsequently sells them at a higher or lower price in country Y, which also has an international regime, the trademark owner cannot oppose the sale because its exclusive right has already been exhausted by the doctrine of exhaustion in country X. An international exhaustion regime is therefore consistent with TRIPs in promoting free trade.

Section 30(4) of the Trademarks Act allows the trademark owner to control the circulation of goods where there are legitimate reasons to object to further dealings in the goods – in particular, where their condition is changed or impaired after they have been put on the market. The Delhi High Court Division Bench has broadly interpreted ‘legitimate reasons’ to include differences in:

• services and warranties;
• advertising and promotional efforts;
• packaging;
• quality control, pricing and presentation; and
• the language of the product literature.

Although an appeal is pending before the Supreme Court of India, the decision remains in force.

A notable aspect of this ruling is that the court directed that, as far as possible, unauthorised dealers and parallel importers must prominently display in their showrooms signs stating that the products they sell have been imported, and that they themselves – rather than the trademark owners – are providing the related warranty and aftercare services. The appellant in this case was ordered to display the following sign outside its showroom: “Samsung/SAMSUNG Products sold are imported into India and SAMSUNG (KOREA) does not warranty the quality of the goods nor provide any after sales service for the goods. We warranty the quality of the goods and shall provide after sales service for the goods.”

Such practices can mitigate the risk of confusion and deception among consumers and help consumers to identify the source of the products and distinguish between parallel imports and authorised products.

In India, the only circumstances in which a trademark owner can oppose or prohibit unauthorised parallel imports and plead infringement under the Trademarks Act are where the goods either were not lawfully acquired or were changed or materially altered after their acquisition. Therefore, given the international exhaustion of rights regime, a parallel importer need not prove that the trademark owner has consented to the parallel imports, either expressly or implicitly. Perhaps the only burden on the parallel importer relates to the quality and safety compliance of the products. In Philip Morris Products SA v Sameer, 209 (2014) DLT 1, the Delhi High Court held that in light of the legal position enunciated by the Division Bench in Samsung, an importer of grey-market goods, its representative or a subsequent purchaser will not be liable for infringement under Section 29 if the imports fall within the purview of Section 30(3). However, the importer must prove that the impugned goods were placed on a market worldwide by the trademark owner or with its consent, and thereafter that it lawfully acquired them.

Customs law

Indian customs law also includes provisions on parallel importation. According to the 2012 Central Board of Excise & Customs Circular on Enforcement of Intellectual Property Rights on Imported Goods, parallel importation is not prohibited unless:

• the goods bear a false trademark as specified in Section 102 of the Trademarks Act; or
• the goods bear a false trade description within the meaning of Section 2(1)(i), in relation to any of the matters connected to the description, statement or other indications of the product, excluding those specified in Sections 2(1)(ii) and (iii).

This marked a clear departure from the Intellectual Property Rights (Imported Goods) Enforcement Rules 2007, which provided that where a trademark owner notified the customs authorities in the prescribed format requesting that clearance of goods suspected of infringing its rights be suspended, and this notice was duly registered by the customs authorities, the import of all goods bearing the infringing trademark would be suspended and proceedings for confiscation of the goods would be initiated under Section 111(d) of the Customs Act. The confiscated goods were eventually required to be destroyed or disposed of outside normal channels of commerce with the trademark owner’s consent.

Consequences of parallel importation

Parallel importation has both legal and economic ramifications. Economically, it promotes the availability of trademarked goods at different prices, which prevents the establishment of a trade monopoly. A monopolistic approach in a parallel import-free market would lead to inflated prices of the goods sold by the trademark owner or authorised dealer. In the absence of cheaper alternatives, consumers would be obliged to purchase goods at the price set by the monopolist. This could have an adverse effect on the overall market, as well as on supply and demand.

Legally, it is essential to prevent deception and confusion among consumers regarding the source or quality of products, and to protect the economic interests of trademark owners. Only if the parallel imported products are materially different from those sold directly can a trademark owner file suit, including for passing off, falsification and infringement.

Therefore, the positive impact of parallel importation is that it forces prices down and provides consumers with goods at lower prices. Parallel imports prevent trademark owners from exercising their exclusive right to divide markets and thus promote free trade, subject to the exhaustion doctrine followed in the particular country. The negative impact is that the manufacturer’s distribution arrangements and ability to monitor the quality of trademarked goods are restricted. Parallel imports are also often used as a tool to cash in on the reputation and goodwill of the trademark owner; this can give rise to an action for passing off.

While consumers may benefit from lower prices for trademarked goods, parallel imports do not necessarily guarantee quality assurance or an aftercare service, and may thus result in consumer dissatisfaction and cause damage to the reputation and goodwill of the trademark. On a more practical note, however, the consumer as end user has the ultimate choice and is the ultimate beneficiary of parallel trade. Most consumers would purchase an Apple or Sony product from authorised dealers only and would be aware of the repercussions if they did otherwise. Similarly, in the case of pharmaceuticals, consumers would generally exercise extra caution and purchase the same from trusted distributors, chemists or hospitals.

Conclusion

Under Indian trademark law, trademark owners can take legal action only against traders dealing in goods that compromise the goodwill, reputation or quality of the trademark. Parallel importation thus acts as a reasonable limitation to the trademark owner’s exclusive rights to use the mark in relation to the goods and services for which it has been registered.

The decision on whether to allow parallel importation is ultimately a choice between quality control and price control; between the economic rights of trademark owners and consumer access; between trade monopolies and free trade. In the trademark context, parallel importation in no way compromises the trademark owner’s right to sue for infringement, passing off or falsification of its marks. In this sense, by following the principle of international exhaustion of rights, Indian law not only safeguards the reputational assets of a trademark, but also ensures free trade, as mandated by TRIPs, by eliminating the monopolistic tendencies of profit-driven trademark owners.

This article first appeared in IAM magazine. For further information please visit www.iam-magazine.com

Administrative Trademark Decisions May Preclude Infringement Litigation

The U.S. Supreme Court ruled on March 24, 2015, that Trial Trademark and Appeal Board (“TTAB”) decisions “can be weighty enough” to preclude a district court from litigating the likelihood of confusion between trademarks in a subsequent infringement suit. The decision in B&B Hardware, Inc. v Hargis Industries, Inc. may not settle the nearly 20-year dispute between the owners of the SEALTIGHT and SEALTITE marks; however, the ruling is likely to increase the importance of TTAB proceedings. In certain circumstances, federal district courts may be bound by TTAB determinations that trademarks are confusingly similar under the doctrine of issue preclusion. Issue preclusion prevents the same issues from being litigated more than once, saving time and resources. 

As the Court explained, “[t]he full story [of the parties’ dispute] could fill a long, unhappy book.”  By 2003, the year B&B filed its opposition with the TTAB to stop Hargis from obtaining a federal trademark registration for a SEALTITE mark, the parties had been litigating trademark infringement claims for eight years.  B&B, the owner of a federal registration for SEALTIGHT for metal fasteners used in the aerospace industry, asserted that Hargis’ SEALTITE mark for fasteners used in building construction created a likelihood of confusion.

B&B won the TTAB opposition proceeding, and Hargis was denied federal registration of the SEALTITE mark. The TTAB determined that the SEALTITE mark was likely to cause confusion with the prior-registered SEALTIGHT mark. The TTAB made the determination based on a multi-factor likelihood of confusion analysis that examines the similarity of the marks, the goods, the customers and the trade channels, among other considerations.  

In this case, the TTAB only decided the narrow issue of the right to own a federal trademark registration. In contrast to a federal court, the TTAB cannot order a party to stop using a mark.  Following its loss at the TTAB, Hargis continued use of its SEALTITE mark. In subsequent infringement proceedings, B&B argued that the TTAB’s finding of a likelihood of confusion between the parties’ marks should stand, and that Hargis should not be able to re-litigate the issue. Both the district court and the Eighth Circuit rejected B&B’s argument and found that issue preclusion did not apply.

The Supreme Court reversed the Eighth Circuit and held that “[s]o long as the other ordinary elements of issue preclusion are met, when the usages adjudicated by the TTAB are materially the same as those before the district court, issue preclusion should apply.” The Court gave several reasons for this decision, including its observation that “the same likelihood-of-confusion standard applies to both registration and infringement.”

The case is now remanded to the lower court to determine if issue preclusion should apply on these specific facts, and thus the fight over the SEALTIGHT and SEALTITEmarks is likely to continue. The Court also explained that “for a great many registration decisions [from the TTAB] issue preclusion obviously will not apply because the ordinary elements will not be met.”

For example, the Court recognized the ordinary elements will not be met when the owner of a mark uses its mark in ways that are materially different from the trademark uses disclosed in a trademark application for registration. The TTAB decision will not have a preclusive effect “if the TTAB does not consider the marketplace usage of the parties’ marks[.]”

The impact of B&B Hardware on brand owners may be minimal. TTAB proceedings are routinely suspended for federal litigation involving the same parties and the same marks; however, parties that participate in a  TTAB case will need to carefully evaluate the potential for issue preclusion in a subsequent action. Indeed, as the Court explained, “[w]hen registration is opposed, there is a good reason to think that both sides will take the matter seriously.”

For trademark owners that disagree with a TTAB decision, they can pursue a de novo review of the TTAB decision before either the Federal Circuit or a U.S. District Court. Otherwise, there is a possibility that issue preclusion may impact subsequent infringement litigation involving the same marks.

http://www.natlawreview.com/article/administrative-trademark-decisions-may-preclude-infringement-litigation

Toyo sues Toyomoto for trademark infringement

Toyo Tire & Rubber Co. Ltd. and its U.S. subsidiaries are suing Japan Toyomoto Tire Corp. and its affiliates for infringing the Toyo trademark.

At the same time, Toyo reported the U.S. District Court for the District of Nevada has issued a permanent injunction against Toyama Tyre Corp. Ltd. in a similar trademark infringement case filed last November.

Toyo filed the action against Toyomoto, which it calls a Chinese corporation, in the same court in Nevada, where both companies exhibited at the recent Specialty Equipment Manufacturers Association trade show in Las Vegas.

In the complaint, Toyo Tires alleges that Toyomoto is marketing and selling tires using the Toyomoto mark, related domain names, and logos in direct infringement of Toyo Tires’ long established Toyo trade name and trademark.

The complaint states: “Defendants… have intentionally adopted the Toyomoto mark to take advantage of the tremendous reputation and goodwill of the famous Toyo marks, and continue to do so knowing of the irreparable harm that they have caused and will continue to cause Toyo, its marks, and the public.”

The court issued a preliminary injunction against Toyomoto on Nov. 12, stating: “The Toyomoto mark is confusingly similar to the Toyo marks, and the defendants are using the mark for the same goods covered by Toyo’s trademark registrations. In addition, defendants are claiming that they are a Japanese company, (which is likely to exacerbate confusion with Japan-based Toyo), even though defendants are China-based companies.”

The court’s ruling means Toyomoto is preliminarily enjoined from using the Toyomoto mark in commerce, including the sale, distribution, promotion and advertising of tires bearing the Toyomoto mark.

Toyo is seeking permanent injunctive relief to prohibit Toyomoto from continuing to infringe on Toyo Tires’ intellectual property rights, together with other corrective relief, including destruction of infringing products and materials, and recovery for damages arising from Toyomoto’s actions.

Toyomoto is a trademark belonging to Kabusikiki Kaisha Tokyo Nihoon Rubber, a Tokyo-based company founded in 1985 by Takahasi Takuo. The site attributes the name to Mōri Toyomoto, a 15th century warlord of the province of Aki.

Takuo later established Japan Toyomoto Tire Corp. and introduced the tire brand in 2011. The site also lists three subsidiaries: Toyomoto (Beijing) International Trading Co.; Toyomoto Tire (U.S.) Inc.; and Toyomoto OTR Division.

Neither Toyo nor Toyomoto identifies the Chinese manufacturer of the Toyomoto brand, but Toyomoto on its website states it has its own tire manufacturing technology and claims to be supplying technology and know-how to an entity it identifies as Saudi Company for Tyre Manufacturing, which Tyomoto claims is setting up a tire production unit in the Gulf States.

http://www.rubbernews.com/article/20141126/NEWS/141129968/toyo-sues-toyomoto-for-trademark-infringement

The Hershey Co. launches trademark infringement court battle against candy importer

Things aren't always sweet in the candy industry.

That much is evident from a wide-ranging lawsuit The Hershey Company just filed in federal court, accusing a importer of infringing its trademarks for the candy maker's best-known products.

Essentially, Hershey claims LBB Imports LLC is bringing in foreign-made candy with packaging and labeling that mimics that of Hershey's well-known brands - Reese's, York, Malteser, Cadbury, Kit Kat and Rolo.

LBB's actions, which continue despite protests by Hershey, are confusing consumers and illegally eating into Hershey's multi-billion share of the candy market, according to the lawsuit filed in U.S. Middle District Court in Harrisburg.

Hershey also accuses LBB of breaching earlier agreements to stop infringing on its famous trademarks. The importer, which has offices in California and New Jersey, has even started marketing a new catalog with its allegedly infringing products, the suit states.

Hershey doesn't list a specific damage amount in the suit, but is is seeking triple damages from LBB, based on an accounting it asks the court to order of the profits the importer has made through the alleged infringements.

The stakes could be quite high, given the profits Hershey lists in the suit for its own products. Sales of the Reese's line alone have exceeded $7 billion in the U.S. in the last five years, Hershey reported, while the Kit Kat and Cadbury products have had sales of around $1 billion and $500 million during the same period. Yearly sales of York and Rolo products each exceed $100 million annually, according to the suit.

Hershey controls all those marks either directly or under license.

LBB is violating those protections both by word and appearance, Hershey contends. LBB's Cadbury, Rolo and Kit Kat imports bear the same name as Hershey's products, according to the suit while the LLB's Yorkie and Maltesers products are only slight name variations from Hershey's York and Malteser lines.

Packaging color schemes also are too close to be legal, Hershey contends. For example, it argues, packaging of LBB's Toffee Crisp product bears the same licensed "Orange Mark" color scheme of Hershey's Reese's line.

Hershey is asking Judge John E. Jones III for an order blocking continued alleged infringement. It wants the judge to direct LBB to turn over its products for destruction and pay for "corrective advertising" to address the harm Hershey contends that LBB has caused to its marketing efforts and sales.

The Hershey Co. is no stranger to trademark infringement battles and is known for fiercely protecting those marks.

The firm has waged such battles with arch rival Mars Inc., with candidates forLancaster County sheriff and the Maryland state Senate who used images similar to company products in their campaigns, with a Michigan furniture company and with Williams-Sonoma over a cake pan design that Hershey claimed looked too much like its signature chocolate bar.

http://www.pennlive.com/midstate/index.ssf/2014/08/not_so_sweet_the_hershey_co_la.html

No copyright or trademark in Yoga, pranic healing asanas, rules HC

Exclusive rights over yoga and pranic exercises, which are derivatives of ancient technique of yoga in India, cannot be claimed under the Copyright Act, the Delhi High Court has held.

The court made the observations while rejecting the plea of Philippines-based Institute for Inner Studies seeking to restrain some persons from teaching the 'asanas' (postures) claimed to be developed by the founder of the institute.

The court relied upon the position of law on the matter in the US and noted that the court there had denied protection to Yoga asanas in case of Bikram Choudhary who is also teaching modern yoga techniques in the US.

A bench of justice Manmohan Singh also held that the expression 'Pranic Healing' cannot be monopolised as trademark by the institute.

"The expression 'Pranic healing' as on the date of the application for the registration was prima facie non distinctive and was the name of the art or technique of doing exercise which was a facet of Yoga.

"The expression was not capable of distinguishing the services of the plaintiff from others due to its wide spread use in the field dating back from centuries ago," the bench said in its 150-page judgement.

The court delivered the judgement on a petition filed by the Institute, which was established by Late Samson Lim Choachuy, Master Choa Kok Sui, on April 27, 1987 and has trusts in various cities in India and the sub-continent.

The institute had moved the high court seeking prohibitory orders against one Charlotte Anderson and others from practicing pranic healing and conducting courses of the asanas adapted by the Master "without proper guidelines and issuing certificates or using literature" of the Master.

"The trade marks which have secured by the plaintiffs in India are all secured post the year 2000 as is evident from the list.

"If the expression Pranic Healing was the name of the art or technique of Yoga in the year 1906 finding place in the books in the field of Yoga, it prima facie appears to be highly doubtful as to how the expression is either inherently distinctive or for that matter capable of distinguishing the goods of one person from that of another.

"Having not made a truthful statement as to proprietorship of the mark pranic healing, the plaintiffs have secured the registration of the expression from the Registrar of the trade mark without informing about the correct proprietorship of the mark applied for on the date of the application."

 Source:http://ibnlive.in.com/news/no-copyright-or-trademark-in-yoga-pranic-healing-asanas-rules-hc/445376-3.html

US Bullying at TPP Negotiations for Big Pharma Profits. Intellectual Property Rights and the Sale of Generic Drugs

Outrageous US bullying by US Trade Representative Stan McCoy on intellectual property and health. McCoy puts profits of pharmaceuticals ahead of the lives of people.

“The world should stand up to the United States.  US corporations are not more important than people’s lives.”

A key dispute in the TPP negotiations is the patents on pharmaceutical drugs and medical procedures.  Long patents inflate the profits of the pharmaceutical industry by not allowing less expensive generic drugs on the market.

This means that people around the world will not be able to afford critical, often life-saving, drugs and medical procedures.  It also means that countries like Japan, Australia and New Zealand that have national health care systems will see the cost of healthcare rise to a breaking point, undermining some of the best health systems in the world.

Stanford McCoy of the US Trade Rep. His bullying tactics seek to prop up inflated pharmaceutical profits at the expense of thousands of lives.

In order for the US to get its way,Stan McCoy, Assistant US Trade Representative for Intellectual Property and Innovation, is chairing the meetings on intellectual properties and medicines.  He has been using bullying tactics to force countries to agree to positions that will harm people in the countries negotiating the TPP, including the US.

“The US has adopted a strategy of exhaustion in its bullying of negotiators on the crucial intellectual property chapter to force countries to trade away health in the Trans-Pacific Partnership Agreement negotiations in Salt Lake City,” according to Professor Jane Kelsey from the University of Auckland, New Zealand, who is monitoring the negotiations. ”The US has stepped up its aggression as they move towards their ‘end point’ of the TPP ministerial meeting in Singapore from 7 to 10 December.”

Margaret Flowers, MD a health policy expert from the US says

“The Office of the US Trade Representative is putting the interests of trans-national health corporations before the needs of people. If the US position is forced through, the TPP will extend patents for medications, medical devices and even procedures for exorbitant lengths of times. This will inflate prices, keeping treatments out of reach for those who need them. This will cause unnecessary suffering and death, especially for the most vulnerable populations, and will undermine health systems around the world and at home.”

“This is a loaded game,” Professor Kelsey said. “McCoy sets the agenda and timetable. Negotiators are working from morning until late at night and preparing to work all night, if necessary. ”This is a crucial period for New Zealand and a number of other countries,” Kelsey observed. The text published by Wikileaks last week shows they have tabled an alternative to the US proposed text that has been repeatedly rejected.”

“New Zealand’s trade minister Tim Groser and his counterparts from the other ten countries must tell the US to stop this behaviour now,” Kelsey said. Flowers added: “Countries negotiating with the United States should not allow themselves to be bullied but should stand up to the United States.  It is looking very unlikely that President Obama will be able to get TPP through the Congress. Why would any country negotiate against the interests of their people?”

The US has around twenty people in Salt Lake City for the intellectual property chapter, who can rotate. Some countries have only one delegate for crucial talks on intellectual property on medicines. Their negotiations on medicines have been extended beyond the dates that were scheduled before negotiators came.  They have continued despite the fact that some health negotiators, especially from poor countries, could not extend their stay.

This follows a pattern of abuse over recent rounds reported in Inside US Trade and other media, where McCoy has acted as a gatekeeper, deciding what proposals from other countries are allowed into the text and what are not.

“This is an early warning of the extreme bullying that can be expected in when the trade ministers seek to close the deal off in December,” Professor Kelsey warned.

Source:http://www.globalresearch.ca/us-bullying-at-tpp-negotiations-for-big-pharma-profits-intellectual-property-rights-and-the-sale-of-generic-drugs/5359221

Cadbury loses trademark case on Eclairs

 In a win for ITC Ltd, the Intellectual Property Appellate Board (IPAB) last week said that Cadbury India is no longer the owner of three trademarks containing the word Eclairs, putting to rest over a decade-old battle.

The three trademarks—Choclate Éclairs, Orange flavoured chocolate éclairs and Chocolate Eclairs pop—were ordered to be removed from the trademarks registry as the patent board found that Cadbury could not provide evidence showing the use of the three trademarks after they were registered.

“The only defence of the respondent is that they are registered proprietors both in India and abroad. Though the respondents (Cadbury) claim use since 1972, there is no evidence for the same,” said the order, adding that registration alone will not help the respondents to prove use. Cadbury is a subsidiary of UK-based Mondelēz International.

“Section 47 of the Trademarks Act, 1999, provides for removal by IPAB of a trademark on the ground of non-use, or if there has been no proof of use for a period of five continuous years from the date of application for registration of the trademark,” said Suchindran B.N., a lawyer practising at the Madras high court.

The implication of this order is that Cadbury can no longer claim to be the owner of the trademarks, which means Cadbury in the future cannot hold anyone for infringement of these marks, said R. Satish Kumar of Chennai-based law firm IP Lead.

Cadbury said it does not plan to pursue this matter further as the Cadbury Eclairs label has not been used by the company for a long time.

“The label mark for Cadbury Eclairs, which formed the subject matter of the litigation, has not been used by Cadbury for many years and hence we do not plan to take this matter further,” said a Cadbury India spokesperson in an email. “We continue to retain other trademark rights in the Cadbury Dairy Milk Eclairs brand and the IPABs decision, if any, has no bearing on those trademark rights. We are yet to receive IPAB’s order in this matter, therefore we wouldn’t be in a position to comment further on this, at this stage.”

The battle began when Cadbury’s in April 2005 filed an injunction in Ahmedabad high court seeking to restrain the use of the trademark Eclairs by ITC against its product called Candyman Eclairs. Since other manufacturers, too, have been using the word Eclairs, the court allowed ITC to use the name Candyman Choco Eclairs.

ITC filed an application with the IPAB in 2005 for the removal of the trademark from the registry.

Source:http://www.livemint.com/Companies/v2om2cMruwjp1CPzvPDXyO/Cadbury-loses-trademark-case-on-Eclairs.html

An end to trademark grabbing in China

Will the introduction of a new Trademark Law in China address the issue of trademark grabbing by unauthorized Chinese parties, 

At the end of August, the Standing Committee of the National People’s Congress adopted the third amendment to the Trademark Law of the People’s Republic of China, which will enter into force on May 1, 2014.What is the implications of the new law and does it address the concerns of trademark holders as to the rampant instances of trademark grabbing by unauthorized Chinese parties?

Challenges under the current trademark law

The actual trademark law, and the related case law of Chinese civil courts as well as the practice of the relevant administrative bodies in charge of trademark protection in China have clearly failed in preventing and punishing a most common form of trademark infringement in China, namely that of the so called trademark grabbing together with the related fall out of trademark trolls actions against foreign investors in China.

Trademark Grabbing

Under Chinese trademark law, only a registered trademark enjoys protection and the first person or entity to register it becomes its lawful owner, even if that trademark has already been used by others in China. Known as “trademark trolls,” certain Chinese companies or individuals are known to actively follow a strategy of registering intellectual property rights in China that arguably belong to their foreign competitors. Aware of the very strict “first to file” principle, they identify, apply and register trademarks belonging to competitors who have forgotten or not yet taken steps to register them.

The actual law and the related practice of all relevant civil and administrative bodies cannot prevent such occurrences. The usurped right holder’s only actual recourse is that of filing a trademark cancellation action and wait years for the hostile trademark to be cancelled, if this is actually really going to happen. The problem for the rightful trademark owner is that in the meanwhile, any act of manufacturing, selling, importing and offering for sale of his products with that stolen trademark, will constitute an act of infringement. The result: the grabber, aware of this, may file a civil or administrative enforcement, thus damaging the foreign company’s business and reputation. There have been indeed several of such trademark troll cases in China in the last years.

No right to prior use

The current legal system does not recognize any legal right to the prior use the foreign holder has made in China of that trademark before the registration of the same obtained by the usurper. The system does lack indeed a legal structure to balance the possible injustice created by the strict observance of the principle of “first to file”.

Trademark grabbing particularly affects medium and small foreign enterprises in China. Lack of knowledge of the trademark system of this country leads often to ineffective trademark filing policies. The loopholes left by unsystematic trademark filings are cleverly exploited by individuals (professional grabbers), competitors, and by local business partners. The latter may initially even do it in good faith, but may later discover that this is a very good bargaining weapon and a preventive tool in case they decide to leave the partnership and become competitors.

Seen in this perspective, trademark grabbing can indeed cause a business to be prevented or to be forced to leave the Chinese market in consequence to the “legal” loss of its brand and the related goodwill.

What solutions does the new Trademark Law hold?

The fact that trademark grabbing has actually reached levels that negatively affect fair competition and distort the principles backing the first to file system upon which the Chinese trademark law is based, has been now fully acknowledged and concrete changes of policy are now visible in the new trademark law.

The first acknowledgement of the existence of an unfair exploitation and abuse of the rule of first to file is the first time ever embodiment of the principle of good faith/bad faith in the trademark Law. Article 7 of the Trademark Law now expressly provides that the application for registration and use of a trademark shall be based on the principle of good faith. Such principle alone can constitute now a solid legal ground to file a trademark cancellation. Such wasn’t the case in the past, due to the lack of a legal base upon which to support a bad faith registration claim.

Aside from reinforcing the legal grounds for filing cancellations against the grabbed trademarks and speeding up the timing for completion of cancellation procedures, a most important change of policy and an exception to the “first-to-file” principle, is now contained in the new trademark law. For the first time in the history of the trademark law of China, if we exclude the case of unregistered well-known trademark, a right of prior use of a trademark in China is recognized under certain conditions, with a positive fall-out for the rightful owner in cases of trademark grabbing.

Article 59 of the third amendment of the trademark law provides that if someone has used a mark identical or similar to a registered trademark, in respect to identical or similar goods, before the date of filing of the latter trademark, and under the condition that the prior mark has meanwhile obtained a certain degree of reputation in China due to its use, the trademark registrant has no right to prevent the prior user from further employing such mark within the original scope of its use. At most, the trademark registrant may impose to the prior user the addition of an indication of distinction to the prior mark.

The norm goes even further by protecting the prior use of designs and shapes which may later form the body of a registered trademark or 3D mark. According to the same article 59, the exclusive right owner of a registered trademark may not prohibit others from the rightful use of the generic names, models or designs of the goods as included in the registered trademark, including registered 3D marks.

Even if the trademark grabber dared filing an enforcement lawsuit against the prior user, not only he would face the risk of rejection of his claims based on art. 59, but will also be subject to another risk related to the non-use of the stolen trademark. In fact, article 64 of the new trademark law provides that the alleged infringer, in this case the prior user, can raise non-use as a defense in a civil lawsuit for trademark infringement and the plaintiff has the burden to prove that he has used the trademark during the last three years from the date of the lawsuit.

If the Plaintiff fails to prove the use of the trademark as requested, the defendant will be exempted from the payment of any damages. Considering that in force of article 59 the prior user can continue to use its mark within its original scope of use, a lawsuit in such a case would be of no consequence for the prior user. Such situation is actually the most typical in cases of trademark grabbing. Most grabbers will in fact not use the trademark, given that the only purpose of stealing is to prevent the filing and use of the trademark by the foreign prior user.

A welcome addition

These new norms are a welcome addition to the Trademark Law. The prior user will have thus the right to continue to use his unregistered marks in China while attempting the cancellation of the stolen trademarks. This will give to the prior user and rightful owner of that sign to prepare and implement cancellations strategies without stopping his business in China.

At the same time, this norm should also discourage the trademark grabbers, especially the professional ones since they normally just grab marks but do not use them. In this respect, a further restraint from grabbing is provided by the new article 64, especially considering that most grabbers never use their trademarks and with such awareness will likely refrain from civil enforcement.

Sourcehttp://www.globallegalpost.com/global-view/an-end-to-trademark-grabbing-60583530/#.UmtsQXCky9Q

Trademark Infringement And Passing Off

Trademark is the identification mark of any company or organization. A customer relates any trademark with the quality of products and reputation of the company that is using it. It is a distinctive name, word, phrase, symbol, logo, design, image, or a combination of these elements that identifies a product, service or firm that has been legally registered as the property of the firm. Trademarks grant the owner the right to prevent competitors from using similar marks in selling or advertising.

There are few important functions of trademark:

A trademark can be used for identifying and distinguishing a particular seller’s goods from others. Trademark also shows the origin of the goods i.e. a customer can identify the manufacturer and also assume about the quality of goods that all goods bearing the particular trademark are of a particular quality desired by the customers. Trademarks are widely used for the advertisement purposes also which helps to customers in associating any good with the quality, reputation and goodwill of any company. So it is very important for any organization to take precautions while allowing any one to use its trademark because the name and reputation of the company is directly associated with the trademark.

Various new concepts have been emerged in relation to trademark due to the technological revolution in the communication, media and other areas and due to the increased knowledge and perception of individuals, business enterprises are showing more interest in registering non conventional marks such as colour marks, shape marks, smell marks, sound marks, advertisement slogans, trade dress etc. to capture the market.

How it can cause damage to a Company:

If any organization is using the registered trademark of another company without permission, that means it is not only committing a crime but also causing damage to the business of the company and damaging the brand name of that company. The organization might be using others trademark to use its market reputation and market stake to enhance its own business without extra efforts. But such companies are not using the exact trademark of other company but they generally go for use of similar marks and here the problem came in to existence. These kinds of activities mainly fall under two heads Infringement and Passing Off.

Infringement:

Section 29 of the Trademark Act-1999 talks about various aspects related to infringement as given in S.29(1) that a registered trade mark is infringed by a person who, not being a registered proprietor or a person using by way of permitted use, uses in the course of trade, a mark which is identical with, or deceptively similar to, the trade mark in relation to goods or services in respect of which the trade mark is registered and in such manner as to render the use of the mark likely to be taken as being used as a trade mark.

Other subsections describe that in course of the use of the trademark it is said to be infringing the rights of other company due to use of similar or identical trademark using for marketing of similar kind of goods and services or use of identical or deceptively similar trademark for any other kind of goods and services. It is further given in the Sub Section (9) of this section that the infringement can also be done by the spoken use of those words as well as by their visual representation.

Passing Off:

The specific description of passing off is not given in the trademark act but the courts have drawn its meaning from common law that if the infringement of trademark done in such a manner where the mark is not only deceptively similar to the trademark of other company but also creating confusion for the customers, which ultimately results in damage for business of the company.

Differences between Passing Off and Infringement:

They are slightly different to each other:

· Statutory remedy is available for infringement whereas the action for passing off is a common law remedy.

· For infringement it is necessary only to establish that the infringing mark is identical or deceptively similar to the registered mark but in the case of a passing off action, the need is to prove that the marks are identical or deceptively similar which is likely to deceive or cause confusion and damage to the business of the company.

· When a trademark is registered, registration is given only with regard to a particular category of goods and hence protection can be given only to these goods and action of infringement would be taken but in a passing off action, the defendant’s goods need not be the same, they may be related or even different.

Judicial Response:

Courts have given several judgements in these kinds of disputes where the infringement and passing off of trademark were in question. Few of them I am discussing in this paper where courts have dealt with these questions and formulated several concepts related to them.

Cases of Infringement;

No one can use the trademark which is deceptively similar to the trademark of other company. As in the case of Glaxo Smith Kline Pharmaceuticals Ltd. v. Unitech Pharmaceuticals Pvt. Ltd. [1] the plaintiff claimed that defendants are selling products under the trademark FEXIM that is deceptively similar to the plaintiff’s mark PHEXIN, which is used for pharmaceutical preparations. The defendants are selling anti-biotic tablets with the trademark `FEXIM' with the packing material deceptively similarly to that of the plaintiff, whereby intending not only to infringe the trademark but also to pass off the goods as that of the plaintiff as the two marks are also phonetically similar. The Court restrained the defendant from using the trademark `FEXIM' or any trademark deceptively similar to the trademark of the plaintiff `PHEXIN', any label/packaging material deceptively similar and containing the same pattern as that of the plaintiff.

If a party using the deceptively similar name only for a single shop and not spreading its business by use of that particular name then also that party could be stopped from using the trade name of other company. This is given in M/s Bikanervala v. M/s AggarwalBikanerwala [2] where the respondent was running a sweet shop in with the name of AGGARWAL BIKANERVALA and the plaintiff was using the name BIKANERVALA from 1981 and also got registered it in the year 1992. Hence they applied for permanent injunction over the use of the name AGGARWAL BIKANERWALA for the sweet shop by the defendant. Court held in favour of the plaintiff and stopped defendant from manufacturing, selling, offering for sale, advertising, directly or indirectly dealing in food articles for human consumption under the impugned trade mark/trade name/infringing artistic label 'AGGARWAL BIKANER WALA' or from using any trade mark/trade name/infringing artistic work containing the name/mark 'BIKANER WALA/BIKANERVALA' or any other name/mark/artistic work which is identical or deceptively similar to the plaintiff's trademark 'BIKANERVALA'.

If the trademark is not registered by any party but one party started using it before the other then first one would have the legal authority on that particular mark. As in the case ofDhariwal Industries Ltd. and Anr. v. M.S.S. Food Products [3] where appellants were using the brand name MALIKCHAND for their product and the respondents were using the name MANIKCHAND which is similar to the previous one and both parties have not registered their trademarks. Court held in this matter that even though plaintiff have not registered their trademark they are using it from long time back and hence court granted perpetual injunction against the respondents.

Even if a company is not doing business in country, but it is a well known company or well known goods, then also it would be entitled to get authority over its trademark. As given in case of N.R. Dongare v. Whirlpool Corp. Ltd. [4] where the defendants have failed to renew their trademark ‘WHIRLPOOL’ and in the mean time the plaintiffs have got registration of the same. In this case court said that though there was no sale in India, the reputation of the plaintiff company was traveling trans border to India as well through commercial publicity made in magazines which are available in or brought in India.

The “WHIRLPOOL” has acquired reputation and goodwill in this country and the same has become associated in the minds of the public. Even advertisement of trade mark without existence of goods in the mark is also to be considered as use of the trade mark. The magazines which contain the advertisement do have a circulation in the higher and upper middle income strata of Indian society. Therefore, the plaintiff acquired transborder reputation in respect of the trade mark “WHIRLPOOL” and has a right to protect the invasion thereof.

Cases of Passing Off;

Even if the goods are not same or similar to each other, then also no one can use the registered trademark of a company for any kind of goods which may result in the harm to the business and reputation of the company which is the owner of the trademark. In Honda Motors Co. Ltd. v. Mr. Charanjit Singh and Ors [5] defendant Company was using the trade name HONDA for ‘Pressure Cookers’ which they are manufacturing in India and even when their application for registration of this trademark had been rejected by the registrar they continued using it and again applied for registration and hence plaintiff has brought this plaint. Plaintiff is the well known company having presence all over the world in the field of Motor Cars, Motorcycles, Generators and other electronic appliances. They are doing business in India in association with the Siddharth Shriram Group with the name Honda Siel Cars India Ltd. Plaintiff has established that his business or goods has acquired the reputation and his trade name has become distinctive of his goods and the purchasing public at large associates the plaintiff's name with them. The use of trademark HONDA by respondents is creating deception or confusion in the minds of the public at large and such confusion is causing damage or injury to the business, reputation, goodwill and fair name of the plaintiff. Hence court has restricted the defendants from using the trademark HONDA in respect of pressure cookers or any goods or any other trade mark/marks, which are identical with and deceptively similar to the trade mark HONDA of the plaintiff and to do anything which amounts to passing off to the goods of the plaintiff.

In the case of Smithkline Beecham v. V.R. Bumtaria [6] the plaintiff applied for permanent injunction to restrain the defendant from infringing the trademark, passing off, damages, delivery etc. of its registered trademark ARIFLO, used in respect of the pharmaceutical preparations. Defendants were using the similar name ACIFLO for their product of the same drug in India. Plaintiffs were not doing business in India for the particular product and argued that since their advertisements are been published in medical journals hence they have a transborder reputation and defendants should be stopped to use the similar trademark which creating deception in customers.

Court said that mere publication of an advertisement in a journal cannot establish a trans-border reputation. Such reputation if any is confined to a particular class of people, i.e., the person subscribing to the said specialized journals and the same can’t be said to be extended to the general consumers. Thus any adverse effect on the firm in such a case can’t be amounted to the offence of “passing off”.

Though the dispute resulted in compromise where the defendant agreed and accepted the plaintiffs’ exclusive right on the use of mark i.e. ARIFLO in India and abroad and further agreed to not to manufacture pharmaceutical preparations under the mark ACIFLO or any other mark identical or similar to ARIFLO.

Trade Dress:

The literal meaning of Trade Dress is - the overall image of a product used in its marketing or sales that is composed of the nonfunctional elements of its design, packaging, or labeling (as colors, package shape, or symbols). That means there is a specific way of writing any product name, its unique background and other remarkable signs. The concept of trade dress has much importance in a country like India where one third of the population is still illiterate. Trade dress helps the illiterate people who cannot read the trademark on the product as well as the manufacturers to reach the people easily.

Delhi H.C. had dealt with this concept in a detailed manner in the case of Colgate Palmolive Company and Anr. v. Anchor Health and Beauty Care Pvt. Ltd. [7] where the plaintiffs have filed the case for the ‘passing off’ of trademark and the dispute was on the colour scheme and combination of colours in a significant manner. Colgate Company was the plaintiff and questioning the use of a mark on dental product which is the combination of ‘red’ and ‘white’ in proportion of 1/3:2/3 respectively and the way of writing the name of product was also in dispute. Plaintiffs were using the mark of particular fashion from 1951 and the respondents started using it in 1996. Plaintiffs have filed the application to stop the respondents from using the particular mark.

The plaintiffs showed to the court that the look of trade dress of the two articles, one manufactured by the plaintiff and another by the defendant from the point of view of not only unwary, illiterate customer/servants of the household but semi-literate also as the trademarks "Colgate" and "Anchor" are written in English language cannot be distinguished by ordinary customer. There is every likelihood of confusion as to the source on account of the similarity of substantial portion of the container having particular colour combination and also shape of the container. Such an action on the part of infringing party also has an element of unfair competition.

Court said in this matter that may be, no party can have monopoly over a particular colour but if there is substantial reproduction of the colour combination in the similar order either on the container or packing which over a period has been imprinted upon the minds of customers it certainly is liable to cause not only confusion but also dilution of distinctiveness of colour combination. Colour combination, get up, lay out and size of container is sort of trade dress which involves overall image of the product's features. There is a wide protection against imitation or deceptive similarities of trade dress as trade dress is the soul for identification of the goods as to its source and origin and as such is liable to cause confusion in the minds of unwary customers particularly those who have been using the product over a long period.

If a product having distinctive colour combination, style, shape and texture has been in the market for decades it got attached with the reputation and goodwill of the company which could be earned at huge cost.

In the present dispute if an illiterate servant or village folk goes to the shop with the instruction to bring Colgate Tooth Power having a container of particular shop with trade dress of colour combination of Red and White in 1/3 and 2/3 proportion he will not be in position to distinguish if he is handed over "Anchor" Tooth Powder contained in a container having the identical trade dress and colour combination of "Red and White” in that order and proportion. Confusion is much large as to source and origin as the difference in name will not make any difference to such a customer and the goods of the defendant can easily be passed off as goods of the plaintiff.

Court said that significance of trade dress and colour combination is so immense that in some cases even single colour has been taken to be a trademark to be protected from passing off action. Except where the colour cannot be protected as the blue colour is for the Ink and red colour is for the lipstick or similar cases. Court said that it is been established that the defendants are using the trade dress of plaintiffs for their containers and hence Court had allowed the application of plaintiffs and restrained defendants from using the colour combination of red and white in the disputed order on the container/packaging of its goods.

Conclusion:

By this discussion we can draw following inferences:

· Registered trademark is the property of the holding company and it is directly associated with the name, reputation, goodwill and quality of products of a company.

· A company can not use the trademark of another company.

· No one can use even the similar trademark which is creating deception or confusion for the customers.

· No one can use the trademark of a company, which is well known and having a transborder reputation, even if it is not registered in India.

· Mere advertisement in a particular journal does not create transborder reputation.

· Trade dress is also a part of trade mark and no one can use the specific writing style, definite colour combination and identifiable background for packaging and labeling a product.

· Mere a single colour can also be treated as a trade dress for a specific product.

Source : ,http://www.legalserviceindia.com/article/l226-Trademark-Infringement-&-Passing-Off.htm