Monday, January 22, 2007

Violation of Statutory Provisions is Act of Piracy [India]

The dichotomy between ideas and the expression of those ideas is a key concept in copyright law. Different expressions of the same idea may obtain separate copyright protection. This concept is enshrined in the Copyright Act 1957 and the violation of the statutory provisions amounts to an act of piracy. At issue in Société des Produits Nestlé SA v Kitkat Food Products (2006 (33) PTC 548 (CB) was the significance of Section 45(1) of the act and the impact of violating that provision.

Nestlé filed an application under Section 50 of the act to expunge an entry in the Copyright Register on the grounds that it was incorrectly entered. The entry was in respect of the KITKAT logo and trade dress. Nestlé contended that the word mark 'KITKAT' embedded in an oval device and using a red and white colour combination constituted a distinguishing visual feature of the KITKAT trade dress, as well as an original artistic work under Section 2(c) of the Copyright Act. It was adopted by Nestlé's predecessor in title, UK company Rowntree Mackintosh, in 1935 and since 1937 it has been extensively commercially used. Nestlé further stated that it had been involved in a number of trademark disputes with Kitkat Food Products; in one such suit Kitkat made submissions regarding its securing of copyright registration in respect of the KITKAT logo and trade dress. Kitkat's reliance on this copyright registration led Nestlé to apply to the Copyright Board under Section 45(1) of the act seeking cancellation of the registration and its removal from the Copyright Register.

Under Section 45(1) an applicant for the registration of an artistic work that is used or is capable of being used in relation to any goods must include a statement to the effect that no identical or deceptively similar trademark has been registered under that act in the name of any other person. As no such statement was made and there was no certificate to that effect from the trademarks registrar, and as Nestlé is the holder of various registered trademarks that are identical or deceptively similar to the impugned artistic work, Nestlé alleged that Kitkat had violated Section 45(1). In addition, Nestlé sought cancellation of the registration on the grounds that the impugned artistic work was identical to Nestlé's registered trademark, which is well known internationally; therefore, it was not an original work and infringed Nestlé's copyright in the KITKAT logo and trade dress.


The board observed that the application raised a variety of questions regarding the violation of rights under both the Copyright Act 1957 and the Trademarks Act 1999. However, it limited itself to the issue of compliance with Section 45(1). Relying on previous cases in which the board had held that non-compliance with Section 45(1) would render a registration incorrect, the board held that violation of that section constitutes grounds for cancellation of the registration and expunction of the entry.

Although the board did not consider the question of deceptive similarity between Kitkat's registered artistic work and Nestlé's registered trademark (the mark KITKAT embedded in an oval device using the red and white colour combination), it did refer to the decision in RG Anand v Delux Films AIR (1978 SC 1618), in which the court set out the following rules to determine similarity:

  • Ideas, subject matter, themes, plots or historical or legendary facts cannot come under the purview of copyright. Copyright violation is confined to the form, manner, arrangement and expression of an idea.
  • In order to be actionable, a copy must be substantial and material. The test is whether the viewer or the reader, as the case may be, is under the unmistakable impression that the subsequent work is a copy of the original, which at once leads to the conclusion that the other party is guilty of piracy.
  • If the same theme is presented in different ways and there are broad dissimilarities, there is no violation of copyright.
  • A violation of copyright amounts to an act of piracy and must be proved by clear evidence.
The fact that the board referred to this case even though it did not consider the issue of deceptive similarity is indicative of the force of Nestlé's arguments.

Attorneys and Copyright Advice [International]

Copyright law does not apply just to teenagers downloading music, but to lawyers as well. Lawyers are good at giving advice, but do we take it gracefully and heed it well when it comes to compliance with copyright law? The starting point in understanding copyright obligations is knowing that copying of copyrighted works is generally infringement unless the copyist has either the right to do so (e.g., a license), a valid fair use defense or a specific legal exemption. What follows is a guide to good -- and bad -- copyright practice inside the law firm as highlighted by a few common situations.


You find an interesting article that your clients might really want to read. They might think better of you because you're on top of new developments, too. Is it legal to forward them copies? First, copyright law doesn't provide a definite number as to how many copies one can make and distribute before the "fair use" defense crumbles and one is legally required to obtain permission. In other words, there is no bright line stating that making four copies is legal and five is not. Note that word, "defense": fair use is a defense and not an absolute right, so law firms wishing to avoid embarrassment and liability over a potential violation might stop thinking about defenses right here and always obtain permission (more about that later).

Regarding the fair use defense in this example, the copying and distribution of the article will almost certainly be viewed as commercial in nature, even though in this situation the lawyer is not charging a fee. (Of course, we might be underestimating the lawyer here.) Further, there is some potential harmful effect or loss on the copyright owner by the unauthorized activity. Both of these facts will generally work against finding of a fair use defense. What to do? There are two practical choices. One choice is to approach the copyright owner for permission. Most publishers maintain rights and permissions departments that license rights. A second alternative is to obtain a kind of blanket license from the Copyright Clearance Center. The CCC provides photocopying and digital use licenses for copying from its large repertory of publications. Many large law firms are already CCC licensees for exactly this kind of purpose.


Assuming the number of copies made is small and limited to the number necessary for litigation, this copying is likely to be within a fair use defense. It would seem logical that the defense will be stronger when the book is out of print and not available at Why would such a small matter create any realistic chance of litigation for copyright infringement? The answer might be that in a pitched battle over other larger issues, the copying could give the parties just one more thing to litigate over. For example, in Religious Technology Center v. Wollersheim, (9th Cir. 1992) the parties argued over whether copies of allegedly stolen documents made for the purpose of preparing an expert witness for a state tort litigation were infringing.


States and municipalities often adopt into law copyrighted texts, such as building codes. Some copyright owners have challenged the subsequent reprinting of these laws by third parties. In Veeck v. Southern Building Code Congress International, Inc. (5th Cir. 2002), the plaintiff filed a declaratory judgment seeking a ruling that he did not violate the Copyright Act when he cut and pasted defendant's copyrighted building codes on his website. Two North Texas municipalities had passed the codes into law prior to plaintiff's publication. The court sided with the plaintiff reasoning that there is only one way to express "the law," and that it is therefore an uncopyrightable fact. Given that the plaintiff republished the law in the precise form in which the municipalities adopted it, the court ruled that he did not infringe defendant's copyrights.


Unauthorized downloading of copyrighted musical compositions to a personal computer is generally infringing. Could a law firm employer be held vicariously liable for such infringement if one of its employees commits it while at work? The answer to this question is generally, "No." In order to be held vicariously liable for an employee's copyright violations, an employer must have the right and ability to control the employee's infringing behavior, and must have an obvious and direct financial interest in the exploitation of the copyrighted materials. Assuming that the employee is illegally downloading music files for personal use and enjoyment (keeping the downloading secret and not using the music for any business purpose), it would seem that an infringement claim brought against his employer would not meet the second prong of this vicarious liability standard. If, on the other hand, the employee is using the downloaded music for a business purpose (such as entertaining clients) the law firm could be liable even if it had not expressly approved the use. All that being said, law firms are well-advised to have policies prohibiting unauthorized downloading.


How many tedious legal presentations would benefit by the inclusion of professional-grade images and music? The Internet has obviously provided users with a vast, tempting free library of lively digital images that can be downloaded and redistributed internationally with ease. Unfortunately, one should assume that most of these freely-accessible images on the Internet are copyrighted. Placement of a © copyright notice on the image (or any other work) is not a precondition to protecting a copyrighted work. In other words, copy at one's own risk. Further, the unauthorized public performance of music may violate additional rights of the copyright owners in the songs. So, yet again licensing is the best way to go for the careful lawyer.

Looking to the future -- for everyone (law firms, too) who wants to re-use copyrighted works -- there's a growing demand for systems that provide easy, fair-priced images and other content at central sources. Although the advice contained in this article may seem obvious, even bothersome, in most situations where law firms want to use copyrighted works, they should do the right thing and get the rights.


Reviewing an Application for Patentability [International]

1. Accuracy and Completeness

As you review the written description and drawings of a patent application with any co-inventors, make sure that they contain an accurate and complete description of the invention. Once the application is on file, it will not be possible to add "new matter" without filing a new application, paying additional government fees, and possibly jeopardizing your filing date.

In the absence of an agreement to the contrary (such as an Assignment), each inventor will have the right to make, use, sell, or license any patent rights that are granted under the application. Any intentional deception that is associated with the naming of inventors may result in the corresponding patent being held unenforceable. Although errors in inventorship that arise without deceptive intent can be corrected at any time, it is preferable to name the correct inventors when the application is filed. In this regard, any person who contributed to the conception or "enablement" (discussed below) of the claimed invention shoul be listed as an inventor. On the other hand, a person who merely makes drawings or a working model from instructions provided by others is not an inventor.

Joint inventors are not required to work together at the same time or location, or make the same type or amount of contributions. Rather, each inventor must only make a contribution to the subject matter of at least one claim. However, where an invention is conceived by two or more people during a "brainstorming" session, then it is likely that all people who spoke up during the session should be considered as co-inventors, unless it is clear that an individual who spoke up did not add anything of substance to the conception of the invention. Where records and recollections are not clear, it is generally preferable to name all individuals present at the session as co-inventors.

2. Enablement

You should also keep in mind that U.S. law requires patent applicants to submit a written description of their invention "in such full, clear, concise, and exact terms as to enable any person skilled in the art to make and use the invention." However, compliance with this "enablement" requirement will ultimately be considered by a judge and/or jury with little or no technical training. Therefore, I generally try to provide enough background information so that even unskilled persons will be able to appreciate the various features and advantages of the invention that are recited in the claims.

I generally try to broadly describe a variety of features in addition to the preferred embodiments that were discussed in your disclosure materials. Regardless of whether you currently intends to seek protection for any of these additional features, it is generally a good idea to disclose them in the application so as to bar patent protection for others with closely similar inventions, and to give us the freedom to broaden or narrow the scope of the claims during the examination process. For example, it may become necessary to narrow the claims in order to further distinguish the invention from earlier prior art technologies. Alternatively, it may become necessary to advocate a broader claim interpretation in order to cover a closely-related, competing technology. Therefore, if there are any other embodiments or features that you may have considered, but rejected, or if there are equivalent structures for performing the function of a particular element, then you should bring them to your attorney's attention so that they may also include them in the application.

3. "Best Mode"

U.S. patent applications are also required to disclose the "best mode" contemplated by the inventor(s) for carrying out the invention at the time the application is filed. Therefore, please make sure that the description section contains an accurate and complete description of the most useful embodiment of the invention, and, in particular, any improvements that may have been recently developed since the date on your invention disclosure materials. It is not necessary for the best mode to be identified as such as long as finding the best mode would not require undue experimentation.

4. Claims

A. Infringement

The scope of a patent owner’s right to exclude others from exploiting a patented invention is defined by the claims at the end of the application. In order to infringe a patent claim, each limitation of the claim must be present in the accused product, either literally or equivalently. Literal infringement requires that the accused product or process include each and every element of the claim. Consequently, if one or more elements of the claim are not satisfied, then the requirements for literal infringement are not met. Even if a claim does not literally "read on" an accused product or process, it may still be infringed under the Doctrine of Equivalents if the differences between the accused product or process and the claims are insubstantial. However, neither the literal or equivalent scope of a claim is allowed to cover the prior art described below with respect to your "duty of disclosure."

B. Claim Interpretation

In the claims, you will see the terms "comprising" or "consisting essentially of" as a transition from the preamble to the body of the claim. These terms have well-defined meanings in patent law. "Comprising" generally means including, but not excluding other features, while the more-narrow "consisting essentially of" means excluding all other features except those that are of no special consequence.

You may also see "means–" and/or "step–plus–function" language in the claims. An element in a claim which is expressed as a "means" or a "step" for performing a specified function is interpreted to cover the corresponding structure, materials, or acts described in the specification, and equivalents thereof. For literal infringement, the accused device must perform the identical function specified in the claim element by virtue of a corresponding structure that is disclosed in the patent specification for performing that function, or an equivalent of that corresponding structure. This is another reason why it is important to identify as many alternative embodiments of your invention as possible.

C. Scope of the Claims

In order to minimize the government surcharge fees charged for examining claims over a certain number, we generally try to limit the number of claims to around a total of twenty. We also try to direct the claims to a single invention in order to avoid the payment of multiple filing fees for independent or distinct inventions that the Patent Office must examine seperately. Nonetheless, you should let your attorney know if there are any other aspects of the invention that should be protected.

With regard to the claims, you will often see that that try to cover a range of embodiments for the invention and, where possible, have included device, method, and/or computer logic claims. In particular, we have created several claim "trees," where each tree has one "root" independent claim sprouting several "trunks" leading to various "branches" of dependent claims. The intuitive result of this configuration is that each dependent claim includes all of the features of the independent claim plus the features in any intervening dependent claims along the trunk to which it is attached. In this way, even if some of the claims are later held to be invalid because they cover prior art for which we were not aware, we can still obtain and enforce a slightly more-narrow scope of protection for the other "embodiments" of the invention that are defined by the remaining claims.

The claims should be reviewed to make sure that they "read on" all of your anticipated commercial embodiments and any other commercially-significant features.

5. Duty of Disclosure

All individuals who are associated with the filing and prosecution of the application have the legal obligation to disclose to the U.S. Patent Office all information that is known by them to be material to the examination of the application. Failure to disclose such information may lead to any resulting patents being held unenforceable. This "duty of disclosure" remains in effect until any patents are ultimately issued and most often applies to two types of "prior art" which could otherwise prevent the issuance of a patent as discussed below.

A. Prior Art

The first type of material prior art is information concerning the invention being "known or used by others in this country," or "patented or described in a printed publication" anywhere in the world, before the invention was completed by the applicant. The second type of prior art concerns the invention being "patented or described in a printed publication in this or a foreign country," or "in public use or on sale in this country," more than one year before the date that the patent application was filed in the United States. With regard to U.S. patents, it is also important to remember that they become effective as prior art on their U.S. filing date, rather than the later issue date on which they are actually published.

B. Submission of Prior Art

In order to comply with this duty of disclosure, copies of any references that are cited in the application will typically be cited to the Patent Office as part of an Information Disclosure Statement, or "IDS." Since government surcharge fees can be avoided by filing the IDS within three months of filing the original application, we ask that you bring any additional prior art to our attention with your other comments on the application. If you become aware of additional prior art later, then you shoul bring it to the attention of us or your attorney as soon as possible so that other surcharge fees can be avoided by promptly submitting the information to the Patent Office within three months of its discovery.

6. Bars to Patentability

Finally, please note that the one-year "grace period" discussed above for certain prior art in the U.S. is not always available for corresponding patent applications that are filed in other countries. Therefore, in order to preserve all of your foreign patent rights, your patent application should be filed before conducting any public or commercial activities which could start the grace period. In other words, the invention should not be publicly disclosed, offered for sale, licensed, or sold until you have received confirmation that a patent application has been filed. If any of the circumstances may apply to this invention, then you should notify your attorney immediately.

Tuesday, January 16, 2007

Software Patents - the debate continues [international - IP KAT reports]

This post is derived from - IP Kat []

The anti-software patent lobby, exemplified by the (rather pretentiously titled) Foundation for a Free Information Infrastructure, have resisted attempts to harmonise patent law throughout Europe by opposing, and ultimately killing, the Computer Implemented Inventions (CII) Directive. The general view, which caused the death of the CII, is that patents should not be granted for computer software. Extensive lobbying of MEPs resulted in a very confused situation, and the CII was abandoned largely because it turned into a bit of a farce with lots of unworkable and contradictory amendments. This was, in the IPKat's view, largely because nobody really understood what they were trying to do. Practically the only MEP who had any degree of understanding on the issue was Sharon Bowles, the only MEP who is also a qualified patent attorney (see her comments on the issue here).

The problem was nobody (even those with some knowledge of IP) could agree on exactly what needed to be changed, let alone how it could be done. While the law could be changed to exclude computer software (more than the current 'as such' exception), how could this possibly be achieved without having effects worse than the current law? Would it be possible to exclude the practice of claiming a computer program (as became possible after this EPO decision)? If so, would method claims that cover computer programs in part be allowed? Should it be a contributory infringement to supply a computer program that was essential to putting an invention into effect (as was found in Menashe v William Hill)?

It is possible that everyone was barking up the wrong tree, and that it is not in fact possible to define the boundaries of what should and should not be patentable in a way that would please everyone (or at least most people, it being impossible to please everybody). Perhaps Section 1(2) is not the place to be looking for a solution.

Section 60 of the UK Patents Act 1977 sets out what does and doesn't constitute an infringement of a patent. In subsection (5) there is quite an extensive list of exceptions to the standard ways of infringing a patent (eg making, using, disposing of). These are meant to be equitable ways of limiting the power of a patent holder against those who should not be pursued for infringement. These include farmers, private non-commercial users, medical researchers and others.

Perhaps this is the place to look for a solution. Why should the development, use, distribution etc. of computer software itself be classed as infringing? If it wasn't an infringement, wouldn't this solve the problems of those who only want to make new software or modify existing software and don't want to risk infringement? Wouldn't making an exception of this kind help the development of new and innovative software solutions?

Here is a proposal then that might just achieve this. In Section 60(5), insert this subclause:
(j) it consists of the making, use, disposal, offering, keeping or importation of computer software.
This little change would exempt software itself from patent infringement. It would not prevent computer implemented inventions from being patented, nor would it prevent companies from suing others for infringement based on real embodiments requiring patentable software solutions, for example the sale of music players or telephones incorporating patented software-implemented inventions. It would, however, prevent software developers from being sued under a patent for merely developing and distributing software they have developed themselves.

Of course, big companies like Microsoft and IBM would doubtless complain that their rights would be severely restricted by such exceptions. However, a large part of the protection afforded to software such as Microsoft's operating systems is due to the combination of copyright protection together with the almost impossible task of reverse engineering publically available object code into source code that can be made sense of. So, copyright protection (which, to remind readers, lasts for 70 years after the last author's death - a very very long time) together with the law of confidential information, seems quite adequate to protect the investment needed to develop software.

Acknowledgement: IP Kat []

Monday, January 15, 2007

Bombay Stock Exchange [BSE] Uses IP Tools to Protect 'Sensex' [India]

The Bombay Stock Exchange Limited (BSE) lists approximately 3,500 Indian companies. The BSE Sensitive Index (Sensex) is a value-weighted index composed of the 30 most actively traded stocks. It is the benchmark index of the Indian stock market and is often used as an indicator to report the status of the financial market. It is considered as an economic barometer both in India and abroad. For this reason, the BSE is protective of its brands, such as Sensex.

The BSE has applied to the controller of patents, designs and trademarks to protect its brands, website and logo. The BSE has already registered the mark SENSEX and the accompanying logo in the United States. In India, the BSE is following the example set by the National Stock Exchange, which has already registered the mark NIFTY, as used in the name of its value-weighted index, the S&P CNX Nifty.

Once trademark protection is awarded, any party launching a product or scheme using the BSE Sensex may have to pay a fee to the BSE. The IP protection will ensure that no party can use the name without the BSE's permission and that the BSE can charge royalties or fees for such use. Recently, Barclays launched the Sensex-based Exchange Traded Fund on the Hong Kong Stock Exchange, which has generated a good response. Therefore, it is likely that the IP protection of the word 'Sensex' will generate revenue for the BSE.

Source :

Liability Bill to make life easier for foreign professionals [India]

Foreign professionals will be able to set up operations in India more easily once the Limited Liability Partnership (LLP) Bill is passed by Parliament. “Two directors of any limited liability partnership have to be based in India, of which one has to be based in India for more than six months.

Otherwise, any professional can become a partner from anywhere in the world,” said minister for company affairs Prem Chand Gupta. The removal of the 20-partner limit will also make it easier for multi-disciplinary foreign firms in legal and accounting services to set up operations in India. The government expects the LLP Bill to be passed by the Winter Session of Parliament this year.

This will clear a major hurdle in what is likely to be a key issue for discussions at a high-level trade visit from UK to India this week. In case of professional services, the minister clarified that as per India’s stand at the WTO on reciprocal arrangements for recognising professionals with individual countries, auditors and lawyers still have some way to go before being allowed to practise in India. A long-standing issue on the agenda is to open accounting and legal services in India to UK firms.

Mr Gupta was in London to meet professionals and his counterparts in the UK government on the eve of the departure of the UK’s largest-ever trade delegation to India. The message he was conveying is that India is not only open for business, but the government is also fast cutting out the red tape. “We were, what, 76 in rank as an easy place to do business last year, but we will improve that ranking by the end of this year,” he said.

Another big grouse of foreign investors about delays in paperwork for setting up companies has already been taken care of, Mr Gupta assured. “You can set up a company in 3 to 4 days through the e-governance project (MCA21).

You can download all documents as well as make payments online,” he said. He said, India's e-governance project, with mandatory online filing, on which the government has spent Rs 350 crore, is now at par with the best in the world. “My counterpart in the UK government said this system is more advanced than the one currently operating in the UK,” he told ET.

Among other reforms, he pointed out a comprehensive revision of the Companies Act will be introduced in the budget session, and the government hopes to have it passed in the monsoon session. “The new Companies Act will be slim, comparable with the best in the world,” he said. “In fact, it will be slimmer than the UK Companies Act I'm told,” he added.

The CA Act for chartered accountants, company secretaries, and cost accountants has already been amended, he told local professionals here, and a statute has been passed to accede to a long-standing demand from professionals to allow multi-disciplinary firms.Mr Gupta pointed out that when it comes to skill and talent, Indians can hold their own anywhere in the world, and Indian accountants and professional service providers should be confident to go out and take on competition globally.

Source : Economic Times, January 15, 2007

Mashelkar Report on Patent Law [India]

Press Information Bureau
Government of India

Sunday, January 14, 2007

Ministry of Commerce & Industry

Mashelkar Report on Patent Law

The Department of Industrial Policy and Promotion, Ministry of Commerce and Industry, set up a Technical Expert Group, under the Chairmanship of Dr. R.A. Mashelkar, former Director General of Council of Scientific and Industrial Research to examine certain Patent Law issues. The report of the Group has since been received and is available at and

Source :

Saturday, January 13, 2007

Replacement of Parts that Must Be Broken Not Impermissible Reconstruction [US]

In Fuji Photo Film Co., LTD. v. International Trade Commission (January 11, 2007) the Federal Circuit provided further guidance on the repair/reconstruction Doctine. On appeal in this case, the parties agreed that the eight step refurbishment discussed in an earlier decision involving the same facts, and a nineteen step refurbishment described in the Commission's exclusion order involved permissible repair. The narrow question on appeal was whether one additional action by Jazz, the addition of a new plastic back cover (to replace the existing covered that had to be broken in order to access the film), converted its activities from permissible repair into impermissible reconstruction.

The latest in this serires of opinions arose out of an enforcement proceeding instituted by the Commission to investigate Fuji’s allegation that Jazz, Benun, and Jazz’s then-president and Chief Executive Officer Anthony Cossentino violated the cease and desist order by importing and selling infringing LFFPs during the period after the Jazz I decision. The Commission had imposed a civil penalty of $13,675,000 on Jazz. It also imposed a $154,000 penalty on Cossentino and held Benun, as the more culpable of the two, jointly and severally liable for the entire $13 million penalty imposed on Jazz. Needless to say, the penalized parties were anxious to reduce their fines.

According to the opinion by Circuit Judge Dyk:

In Husky Injection Molding Systems Ltd. v. R & D Tool & Engineering Co., 291 F.3d 780 (Fed. Cir. 2002), we concluded that the replacement of a spent part was a fundamental example of a permissible repair. Id. at 785-86. Benun
contends that the back covers were spent parts and their replacement was permissible repair. This is so, he argues, because as a practical matter the backs had to be broken to remove the film, and once new film was inserted the
back covers could no longer serve their function of enclosing the camera and keeping light out. The backs therefore were spent and could properly be replaced. Although Fuji did not intend the LFFP to be refurbished, "the patentee’s unilateral intent, without more, does not bar reuse of the patented
article, or convert repair into reconstruction." Jazz I, 264 F.3d at 1106; Hewlett-Packard Co. v. Repeat-O-Type Stencil Mfg. Corp., 123 F.3d 1445, 1453 (Fed. Cir. 1997).

Benun’s factual premise that the backs had to be broken to repair the film is not contested by the Commission on appeal. This court and other tribunals have repeatedly concluded that, in view of the continued utility of the shutter mechanism, lens, viewfinder, film advance mechanism, and other significant parts in the original camera, replacing the film is a permissible
repair and reattaching or replacing a part that must be removed or broken to replace the film also constitutes permissible repair. See Jazz I, 264 F.3d at 1106 (reattachment of the back cover); Fuji II, 249 F. Supp. 2d. 434, 446 (D. N.J. 2003), aff’d 394 F.3d 1368 (Fed. Cir. 2005) (removal of the film door that
was broken in removing the film); J.A. at 95 (refurbishment of the half backs). Significantly, there is no contention here that the extent of the refurbishment is disproportionate to the overall value of the parts that were not replaced. See Husky, 291 F.3d at 786-87; Jazz I, 264 F.3d at 1106.

In a variety of other contexts we have also held that replacement of a part that must be broken or removed to repair the device does not convert permissible repair into impermissible reconstruction. For example, in Bottom
Line Management, Inc. v. Pan Man, Inc., 228 F.3d 1352 (Fed. Cir. 2000), we found that "incidental repairs to minor damages" necessary to replace a spent part did not justify a finding of reconstruction. Id. at 1356 (internal quotation marks
omitted). In that case studs that held a spent part in place had to be broken in order to remove that part for replacement, and we concluded that replacement of these studs did not justify a finding of reconstruction. Id. at 1355. Similarly, in Everpure, Inc. v. Cuno, Inc., 875 F.2d 300, 303 (Fed. Cir. 1989), we held
that a patentee who designed a product so that the neck which connects a filtering cartridge to the base of the device had to be replaced in order to replace the worn-out cartridge itself could not claim impermissible reconstruction from the replacement of the neck. We concluded that "Everpure and Everpure alone made the business decision to sell disposable cartridges and to
render its filter irreplaceable without replacement of the entire cartridge." Id. Likewise, in this case, it would appear that Jazz’s actions in replacing the back covers, which must be broken in order to replace the spent film and film cartridge, does not justify a finding of impermissible reconstruction.

The Commission’s sole basis for reaching a contrary conclusion was its reliance on an erroneous repair-reconstruction test. The Commission found that by replacing the back cover, Jazz was completely replacing two horizontal ribs that satisfied the "means for exerting force" element of claim 5 of the ‘495
patent,16 as well as completely replacing two other elements of claim 5 (the film and the film cartridge) and partially replacing the fourth element (the light-tight film case). The Commission said, "if a component is integral to a specific patent claim, and it is replaced with a new part, such replacement could weigh heavily towards a finding of reconstruction."

The Supreme Court in Aro Manufacturing Co. v. Convertible Top Replacement Co., 365 U.S. 336 (1961) rejected a test for repair/reconstruction that would look to whether an "essential" or "distinguishing" part of the patented combination had been replaced. Id. at 345. In doing so, the Court concluded "that the combination patent covers only the totality of the elements
in the claim and that no element, separately viewed, is within the grant" and "that there is no legally recognizable or protected ‘essential’ element, ‘gist’ or ‘heart’ of the invention in a combination patent." Id. at 344-45. We see no material difference between the Commission’s test that focused on whether an "integral" component has been replaced, and the tests previously rejected by the Supreme Court that focus on whether an "essential" or "distinguishing" part, or part that is at the "gist" or "heart" of the invention, has been replaced. , 448Publish
U.S. 176, 217 (1980))).

. . . Thus, we conclude that the Commission erred in holding that the cameras in which full backs were replaced were impermissibly reconstructed; we hold that the replacement of the full backs was part of a permissible repair. We accordingly remand to the Commission for the limited purpose of considering an appropriate adjustment in the amount of civil penalties in light of our holding that the 998,250 [of the 27 million] LFFPs refurbished by replacing the full backs were permissibly repaired.

Starbucks loses trademark battle in South Korea

South Korea's Supreme Court on Friday rejected a claim by Starbucks that a local mobile coffee-shop chain infringed on its trademark rights by using a similar brand name and logo.

The Supreme Court upheld a decision handed down by the Patent Court of Korea in March 2005 that Elfreya's trademark and logo are not similar to those of the global cafe chain.

"There is no similarity as a whole between the trademarks and logo of Starbucks and those of Elfreya as they have different appearance and names," the court said.

"Considering the timing when Starbucks started business here and the intensity of its advertisement activity, it cannot be said either that the Starbucks trademark was well-known here before Elfreya registered its trademark," it said.

The South Korean company was launched in 1999 with the brand name Starpreya and logo of a green circle surrounding the image of what it called a goddess, similar to the well-known Starbucks logo.

But the patent court said the two logos are not alike because Elfreya logo has the image of a goddess while that of Starbucks has a mermaid in its symbol.

The Seattle-based coffee chain, which started business here in 1999, on Thursday opened its 190th shop in South Korea.

Source: DNA Money, January 12, 2007

Government Scientists To Get Royalty For Patents [India]

Government Scientists To Get Royalty For Patents

The Minister for Science and Technology has announced optimistic news for the Indian government scientists. The scientists working with various government research institutes are to get a share of the licensing fee, which the Government charges when technology is transferred to a company for making a marketable product. The Union government has announced that it will introduce a law that will give scientists in Government-run laboratories a share in royalty when their innovation brings commercial dividends.

It is expected that the new law will be modeled on 1980 Bayhe-Dole law in the US, that enables the innovators in public sector research to benefit from commercialisation of their invention. The US law mandates royalty sharing between the Government and the innovator. The incentive facilitates technology to move from Government laboratories to the market. It further encourages public sector research and brings convergence between research and industry.

The new proposed legislation which is expected to be introduced in the next budgetary session, aims to discourage government scientist from publishing papers, but in turn, would encourage them to patent technology leading to wealth creation. The Indian Pharma Company, presently spotlight only on services and generics rather than innovation. The Pharma Companies are expecting that they could be the main beneficiaries, as the government scientist can bridge the gap to a great extent. The government is planning to give 30% of the royalty, license and profits from the public funded research project to scientists who have worked on the project. But, the onus will be on the individual scientist/researcher to report his study and seek patent for the same.

Earlier, due to little contribution for innovation from the part of the government, there was a fear of ‘brain drain’ in the industry. But, research is now global and India is seen as contributing to global research generating capacity. As the attitude is shifting, Government policies will continue to support strategic research because these cannot be bought off the shelf, but will have to be carried out in coordination with the industry. Universities will have a much more important role to play with the advent of the new legislation. Right incentive in the government laboratories will send right signal and will give rise to new technology.

Acquiescence: A Facet Of Delay [India]

Acquiescence: A Facet Of Delay


A word trademark is inherently distinctive when it is an invented or coined word and the uniqueness of its distinctiveness can be diluted if used by others in an unauthorized manner. But the pertinent question here is that what is the time limitation to bring a passing off action against the unauthorized use of the trademark. Whether a trademark owner can be allowed to come after elapse of a considerable period of time to set the clock back. The instant case Intel Corporation v. Anil Hada and Ors. 2006 (33) PTC 553 (DEL) looks into the issue of delay in taking action against passing off.

Background of the Case

The claim of INTEL [plaintiff] is that the mark ‘INTEL’ is an invented word having inherent distinctiveness and the same had been using it as its corporate name and as a trademark on its products since 1968 worldwide and since 1972 in India. It has earned substantive goodwill and reputation among members of the trade and public. The word ‘INTEL’ reflects their organization as the trade origin and the usage of the mark by the defendant will create confusion and deception as both of them are in the same trade channel with allied business and common consumers. It was also stated that the distinctive character of the mark would be eroded and hence diluted.

The contention of the defendant is that the word is an abbreviation derived from the word "INTernational" and "ELectronics", and it is also commonly used for various activities related to international electronics like "Intel post" and a satellite organisation "INTEL SAT", therefore there cannot be any monopoly or right over the impugned word. It was also stated that the plaintiff in spite of being aware of the existence of the defendant never complained and now when they have, after spending considerable amount of money in publicity, acquired a reputation of their own, the plaintiff wants to stifle the existence of the defendant.


The Court while dismissing the application held that the defendants are justified prima facie as to how they have coined the word INTEL to be used as part of their corporate name and therefore it cannot be said that the adoption of the word was deceptive and surreptitious to cheat the plaintiff. Also there is no prima facie evidence to show dishonest adoption as the presence of the plaintiff was in the embryonic stage when the word INTEL was adopted as a part of the corporate name. Balancing the claims of the plaintiff and that of the defendants it was opined that the balance of convenience and irreparable injuries leans in favour of the defendants for the reason that action has been brought after 15 and 16 yrs of commencement of business respectively.


The development of trademark law has recognized trans-border reputation and the right to protect the mark against dilution. It is also well recognized that delay in bringing an action where there is a dishonest adoption of a mark is of no consequence but if a plaintiff stands by and knowingly lets another person to build up the trade until it becomes necessary to crush it, the plaintiff would be estopped by acquiescence. Acquiescence is nothing but one facet of delay. It implies positive act by knowingly sitting idle.

Indian Patent Office Seeks Recognition As International Search Authority [India]

Patent Cooperation Treaty was signed by India in 1998. It allows an inventor to file an "international patent application," which has the effect of filing a separate patent application in each of the PCT member countries designated by the inventor. The accession boosted up big, medium and small industry and research institutes as they considered the PCT as a strategic business tool, essential in seeking patent protection abroad and in gaining competitive advantage. India, being one of the leaders in pharmaceutical and biotechnology industry, is the chief users of the PCT system.

Once, an international application is filed, an international search is conducted as provided under Article 15 of the PCT. This international search is to discover relevant prior art on the basis of the claims made in the patent document. The patent office, which does the search, is usually termed as International Searching Authority, which is either a national office or an intergovernmental organization.

There are recognized International Searching Authorities, under the PCT, which are appointed by the PCT Assembly on satisfying the minimum requirements particularly as to manpower and documentation. Each receiving Office in accordance with the Article 16(3)(b) of the PCT, informs the International Bureau as to which International Searching Authority is competent for the searching of the international applications filed with it. When there are several competent International Searching Authorities specified by the receiving office, the applicant of the international application has the choice of having the search done by an International Search Authority of his choice. The results of the international search are set out in an international search report (ISR), which is made available to the applicant nine months after filing of the application.

Presently the Indian Patent Office is acting only as a receiving office whereas European Patent Office along with Austrian Patent Office and US Patent Office conduct majority of the international search on Indian international patent applications. India has expressed its plans to approach the WIPO for recognition of its patent office as the International Search Authority (ISA) and International Preliminary Examination Authority (IPEA). And as a preliminary step in this direction, the Rs. 1,300 crore modernization plan to computerize the patent offices is complete. The next step to interlink the patent offices to facilitate easy search of patent database is to be completed by March 2007. Once the linkage is complete, India plans to approach the WIPO for recognition of its Patent Office as IDA & IPEA, which would enable patent offices across the world to outsource patent search services to the Indian patent office.

Wednesday, January 10, 2007

Portable Devices and [Data] Security Threats [International]

Think a data security breach is unlikely to hit your firm? Think again. One of the greatest risks facing organizations today is the proliferation of portable devices -- laptops, PDAs, USB jump drives -- that often contain personal customer or employee data.

In fact, a recent survey of 500 corporate IT departments, conducted by the Ponemon Institute, found that 81 percent of respondents had experienced a lost or stolen laptop or portable storage device. And, says the institute, about 60 percent of PDAs and laptops contain unprotected sensitive or confidential information.

These data losses can be very costly. Let's look at some recent reports:

  • A 2006 survey from Symantec Corp. found that the average laptop contains data worth approximately $972,000.
  • Another 2006 survey, produced by the Federal Bureau of Investigation, estimated the average annual cost of computer security incidents at $67.2 billion.
  • An earlier 2005 survey, from PGP Corp., reported that lost confidential customer information typically costs companies $14 million.


But costs of lost or stolen data are not just monetary. They often include loss to business reputation and customer goodwill.

For example, PGP found that when companies notify customers that their data has been compromised, 19 percent terminate the relationship, 40 percent consider terminating the relationship and 27 percent of respondents express concern about the relationship.

Indeed, half of recovery costs after a data breach are attributable to loss of existing customers.

So what can you do to protect your firm?

You may be surprised, but protecting your data often involves some very simple, common-sense steps:

  1. Encryption: To protect sensitive information and reduce the need to report security breaches, be sure your users routinely encrypt all names, addresses, account numbers and other personal information.
  2. Passwords: Always protect information stored on the laptop with a secure password. To maximize safety, passwords should include a combination of numbers and upper- and lowercase letters.
  3. Remote security tools: Be sure that everyone in your organization is using remote security tools that help your firm find and deactivate drives in the event a portable device is lost or stolen.
    Among the products available are MyLaptopGPS, by AIT Solutions and Inspice Trace and Inspice SmartProtec from Inspice.
  4. Backup, backup, backup: It goes without saying that it's absolutely essential to do backups. Be sure that all important data contained on the laptop is backed up. Establish and enforce protocols.
  5. Hardware: In addition to software security, use traditional hardware measures -- such as locks and cables. These security devices make theft more difficult and thereby discourage thieves from taking your machine.
  6. Hide your device: Never leave a device on your desk or any other open, visible place. When leaving a laptop in your office, make sure it is hidden and secured.
  7. Be inconspicuous: Always keep your laptop in an inconspicuous case. Flashy cases will expose your computer by attracting thieves' attention.

A simple, padded messenger bag can suffice as a protective container.


Your organization may want to consider some of the new policies offered by insurance providers that are specifically designed to assist with data breaches. These may help you defray the costs associated with investigating a breach to determine whether state laws require notification, as well as help pay for the costs associated with breach notification requirements.

The new policies often include coverage for the following claims:

  • Failure of network security;
  • Wrongful disclosure of private or confidential information;
  • Failure to protect confidential or private information;
  • Violations of federal, state or local privacy statutes.

Some corporate identity theft insurance policies also assist with the costs associated with defraying damage to the firm's reputation. Some also provide crisis management coverage and reimbursement for public relations expenses.

The coverage also may provide a defense in the event that a security breach results in a regulatory investigation or a civil lawsuit. For example, AIG's Corporate Identity Protection offers a product that covers administrative expenses resulting from a breach of personal information.

Like a traditional commercial policy, some security breach policies contain provisions that the insurance company will be required to pay for an attorney to defend the company in the event it experiences a data security breach.

Finally, look for policies that cover the costs associated with post-event services, like credit monitoring and identity theft education to the individuals affected by the security breach.

Tuesday, January 09, 2007

Artist's Resale Right Report [UK]

On February 14, 2006, the UK Artists' Resale Right (ARR) came into operation, after a year-long media campaign on behalf of UK art market professionals opposing its introduction, and a media campaign led by the Design and Artists Copyright Society (DACS) on behalf of UK artists supporting its introduction. What are the highlights of the fast six months or so of ARR operating in the UK?

Readers will recall (AM293) the UK governments legal obligation to enact into UK legislation the requirements of an EU law (Directive 200I/84/EC) requiring all EU Member States to give their artists an automatic legal right to receive a payment when their works are resold. ARR will apply to works protected by copyright law (works that have been made by independent creative skill and labour - have not been stolen from another artist), and will last for the same length as copyright (the lifetime of the artist plus 70 years after the end of the year of the artist's death). The amount of the royalty payable is a percentage of the sale price based upon a fixed sliding scale of consecutive portions of that price:

Portion of the safe price - Percentage amount
From €1,000 to €50,000 - 4%
From €50,000.01 to €200,000 - 3%

From €200,000 to €350,000 - 1%
From €350,000.01 to €500,000 - 0.5%
Exceeding €500,000 - 0.25%

However, the total amount of royalty payable on any one sale shall not exceed €12,500; sales of less than €1,000 and those made within three years of the artist's studio sale or gift are outside the scheme, as are sales between buyers and sellers who are not art market professionals. Sales of works of dead artists come within the scheme from January 1, 2010. The ARR royalty must be paid by the art market professional (usually the seller or their agent) directly to an artists' collecting society, which in turn will pay the artist (artists cannot claim their ARR royalties directly).

Accordingly, living artists (and, from January 1, 2010, the estates of artists who died less than 70 years earlier) need to contact a collecting society to which they should transfer management of their ARR. The ARR of artists who do not register with any collecting society are automatically managed by 'the collecting society which manages copyright on behalf of artists' - the only such society in the UK is DACS. This means that UK art market professionals who have not been contacted by any collecting society mandated by any living EEA artist whose works they have sold on or after February 14, 2006 (note: the ARR applies to all European Economic Area (EEA) artists whose works are sold in the UK, not just UK artists) should send the ARR royalty payment directly to DACS. And only DACS, because no other UK Collecting Society also 'manages copyright on behalf of artists' generally in the UK. This has recently been confirmed by the government department responsible for overseeing UK's ARR, the UK Patent Office, which recently stated: 'Any number of collecting societies may set up to collect resale right provided they have mandates from those they represent but only those societies which manage copyright in general on behalf of artists could be deemed to be mandated and entitled to collect on behalf of non-mandating artists. Currently DACS is the only organisation we are aware of which meets these criteria. DACS may therefore collect on behalf of all artists who have not mandated another collecting society.'

Two other collecting societies have been established in recent months to offer to living UK artists management of their ARB. So artists have a choice of three organisations to mandate management of their ARR. DACS is a 20-year old not-for-profit artists copyright collecting society (register online at or request a registration form to be posted by phoning 0845 410 3410 or email The Artists' Collecting Society (ACS) was recently established at the request of artists represented by the Society of London Art Dealers and the British Art Market Federation, 'with the aim of supporting the art trade' (020 7908 1604 or email Artists' Rights Administration Ltd (ARRL) appears to be a commercial company established by an art dealer specialising in Russian art (no contact details to date).

The two not-for-profit collecting societies charge mandating artists a commission fee to cover their administrative costs: at the time of writing ACS charges 15% of the royally payment collected; DACS' policy is to match the lowest of its competitors' charges (on the 'never knowingly undersold' principle) and therefore currently charges 15%; the commercial collecting society, ARRL, currently charges 20%.

DACS has been the first of the three UK collecting societies to receive and pay out royalties, which it began to do in July 2006, following months of preparatory work, software modelling and so on, and establishing good working relationships with art dealers, galleries and auction houses; and achieving specific mandates from living UK artists. DACS pays its artists every 30 days. DACS has established an international network, through its sister copyright collecting societies throughout the world, to collect ARR royalties for UK artists from overseas, and for the administration of which DACS mates no charge to UKartisis.

It is understood, at the time of writing, that ACS and ARRL each have mandates from a handful of artists, but neither has invoiced nor received royalties, and therefore has not paid out. ACS proposes to pay artists twice yearly, and ARRL's policy is not yet known. Neither body collects ARR payments for UK artists from overseas.

Collecting societies throughout the developed world have been operating for a century or so to manage intellectual properly rights of creative and performing artists and their publishers, on the basis that it would be impractical or uneconomic for the artists themselves to monitor and manage. It is very unusual for there to exist in one country more than one organisation managing the same intellectual properly rights collectively, because this duplicates the resources devoted to managing the artists' mandates and inevitably increases overall costs (to artists generally). UK artists themselves will ultimately decide which ARR collecting societies will succeed, and which will disappear, because their economic survival entirely depends on the artists' mandates.

Although it is far too early to tell, professional art market sales in the UK since February 14, 2006 do not appear to have been damaged by sellers and/or buyers opting to trade in, say, Geneva, New York City, or other non-ARR countries, as was strongly predicted would happen by UK art market professionals opposed to the introduction of ARR.

Compared with the Republic of lreland, the UK appears to have taken well to the introduction of ARR. The Irish government failed fully to implement ARR by the beginning of 2006, as was legally required by EU law, and instead adopted a much slower, two-stage approach: it issued a simple set of very basic ARR regulations - five months or so after the EU implementation deadline - 'rather than wait for all the more complex matters to be addressed in their entirely'. Irish artist Robert Ballagh took legal proceedings against the Irish government for this failure, and an Irish court recently awarded him compensation of €5,000. "The award was based upon Ballagh's successful estimated loss of around €3,000 in ARR payments, and the judge added €2,000 for potentially further lost sales. The case was supported by the Irish Visual Artists' Rights Organisation (IVARO), which was established in 2005 along lines similar to DACS. IVARO is pressing the Irish government for full implementation of ARR along lines similar to those now operating in the UK.

SPS Tech versus Motorola - Trade Secrets

Broward, Fla., Circuit Judge Leroy Moe ruled Monday that Motorola willfully violated court orders during a $10 billion trade secrets trial late last year. The ruling could expose the electronics giant to millions in fines, attorney fees and trial costs.

Judge Moe agreed with lawyers for SPS Technologies, which sued Motorola, that during the eight-week trial which ended with a hung jury in November, Motorola placed experts on the stand who previously had read other witnesses' testimony. That violated the witness sequestration order he imposed at the start of the trial and prejudiced the plaintiff's case, he said.

But Moe rejected SPS Technologies' motion for a directed verdict in the trade secrets case.

During Monday's hearing, Moe said he "almost threw up" during the trial when Motorola's expert witnesses acknowledged they had read the testimony of plaintiff experts before going on the stand. He said this action was prejudicial and that "sanctions are in order."

The SPS attorneys asked Moe to fine Motorola $118 million -- $100 million in sanctions, $11 million in attorney fees and $7 million in costs. The amount of attorney fees, costs and sanctions to be levied against Motorola will be determined in a later hearing.

But Motorola's attorney, Dinah Stein of Miami, argued at the hearing that her client wasn't at fault for the violations of the sequestration order. She said the rule was violated through the inadvertent actions of Motorola's trial counsel, who did not think the defense was violating the rule.

Now-defunct SPS Technologies of Fort Lauderdale, Fla., sued Schaumburg, Ill.-based Motorola in 2002, claiming that Motorola stole trade secrets to create a vehicle-tracking device. SPS alleged that Motorola stole the technology from the smaller company after the two companies broke off negotiations in 2000 to develop a joint venture.

Juan Cantor and Roberto La Rocca, the two principals of SPS, claim they spent six years developing the technology. They said they came up with the idea after a number of the Cantor family's security trucks were broken into in Venezuela. The plaintiff sought at least $10 billion in damages.

Publicly traded Motorola reported $10.6 billion in revenues in the third quarter of 2006.

The trial started in early October. Judge Moe ordered the sequestration of witnesses on Oct. 9, at Motorola's request.

Prominent Stuart litigator Willie Gary was lead counsel for SPS during the trial. Ed Moss of Shook Hardy & Bacon in Miami was one of a number of attorneys who represented Motorola.

After the sequestration rule went into effect, Moe ruled that one of Motorola's experts on damages could not remain in the courtroom while one of SPS' experts testified. Moe also denied SPS' request to have one of its experts remain in the courtroom after he testified to advise attorneys on expert testimony.

Yet Motorola's damages expert Daniel McGavock and trial witness Douglass Locke both admitted during the trial that they read the testimony of SPS' witnesses.

On Monday, SPS attorney Manny Socias, of Gary Williams Parenti Finney Lewis McManus Watson & Sperando in Orlando, Fla., said the trial was "fundamentally tainted by violations of the sequestration rule." Gary, his Stuart, Fla.-based partner, called it an "in-your-face violation."

Motorola "violated you [Judge Moe] in the worst way and I don't care who they are or how big they are, they shouldn't have the right to get away with it," Gary said. A sanction of $100 million is the only way to get the message across to the defendant, he argued.

Stein, of Hicks & Kneale, said if Motorola had willfully violated the rule, the company wouldn't have asked McGavock on direct examination if he had read testimony of SPS experts. "This is not the action of a party trying to deceive the court or obtain an unfair judgment," Stein said Monday.

Stein also said that the defense attempted to inform Moe that Locke also had read testimony but Moe said he didn't want to hear it.

In addition, she contended that the testimony of Motorola's witnesses was not influenced by their reading the other side's testimony. She said the plaintiff never compared the Motorola witnesses' depositions with their trial testimony to determine if their statements changed.

But Socias argued that the violations of the sequestration rule were the fault of Motorola and not just the fault of the company's attorneys. He said Motorola had a number of attorneys in the courtroom, including its own in-house counsel.

Socias asked Moe to issue a directed verdict holding Motorola liable in the trade secrets case, then have just the damages portion of the case proceed to the jury.

Moe denied the plaintiff's motion for a directed verdict. A new trial could begin as early as March.

Regarding attorney fees and costs, Moe said he would attempt to separate out the costs arising from Motorola's violation of his orders, so that the company wouldn't have to pay attorney fees and costs for the entire trial.