#IPLaw, #IPBasics – Detention under customs control and custom seizure of more than 8000 counterfeit automobile parts in Drôme and Indre (FR)

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EU law allows a regime of keeping goods in detention under customs control, when they are suspected of infringing industrial property rights.

Needless to say, it is important that rights must first be registered to justify the use of this regime.

Under this scheme, the procedure in France allows custom agents to retain imported goods by refusing any release for 10 days. Detention under customs may be initiated by a written request from the IPR holder, or on the own initiative of the custom agents.

The filing of a request for intervention of the customs is free of charge. The request is valid for one year, and renewable by a written request. As provided by law, when the goods suspected to be infringing are immobilized during a detention, the IPR holder must justify, within 10 working days, either of provisional measures or of the introduction of a legal action.

Within this period, the customs contact the right holder in order to have the goods appraised by an expert, generally the IP atorney of the right holder, to recognize whether or not the detention is justified and whether an infringement of industrial property rights is characterized.
Subsequently, according to the procedure, the holder can request the destruction of the goods in the absence of express objection from the importer. This is generally called the simplified destruction procedure. Alternatively or cumulatively, the holder may bring an action for infringement against the importer.

Actually, even without action by the owner of the IP rights, in some cases the customs authorities usually use their customs powers to destroy counterfeit goods, in obvious cases.

Thus, at the beginning of September this year, according to the provisions of the procedure, the customs office of Valencia (FR) has selected among the import declarations received, one particular from Turkey.

After checking the goods, the customs officers discovered window lift systems, door openings, and door handle parts. The customs announcement states that “none of the plastic packaging containing the car parts contained the wording “adaptable to “”, which suggests that the packages in question mentioned the names of the car trademarks.

The expertise of the holders of IP rights has recognized 3 740 spare parts as counterfeits. These counterfeits have been subject to a simplified destruction procedure.

The information was transmitted to the service within the territory of the recipient company, so that an inspection could be made on its premises, which enabled the seizure of 4 300 additional parts considered as counterfeits, which subsequently underwent a simplified destruction procedure.

In 2017, the French customs seized more than 8.4 million counterfeits articles in France.

Of course, the importer in good faith may request the intervention of an IP Attorney to make legitimate disputes and avoid having to cease his activity because of significant unjustified losses.

SOPERYAH IP

#CopyRLaw #EULaw #DELaw – CJEU Decision on Peer-to-Peer Copyright Matters

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The case (C-149/17) pits the German publishing house Bastei Lübbe against a private individual, Mr Michael Strotzer, who has an internet connection which would have been used to share, and make downloadable, an audio book on a platform Peer-to-peer with an unlimited number of users.

For the record, French law established the entity HADOPI (High Authority for the Dissemination of Works and Protection of Rights on the Internet) and what is commonly referred to as the “graduated response”. Essentially, in such cases, the HADOPI, or more precisely the HADOPI Rights Protection Commission (CPD), sends successive warnings to the holder of the Internet subscription used.

After three unsuccessful warnings, the CPD may seize the judicial authority on the basis of the negligence breach for failing to prevent the use of its connection for infringement. The contravention can go up to 1,500 euros or 7,500 euros for legal persons.
The CPD can also invoke the basis of the offense of counterfeiting, likely to result in a sentence of up to 3 years imprisonment and 300,000 euros fine or 1,500,000 euros for a legal person.

German law provides a way out for Mr Strotzer. According to the case law of the Federal Court of Justice (Bundesgerichtshof), it is possible to invoke the fundamental right to the protection of family life, and the fact that family members have had access to the internet connection, such that the holder of said connection may not assume responsibility. It was on this basis that Mr. Strotzer argued that his parents living at home had access to this connection, without further specification.

In this context, the Landgericht München I asks the Court of Justice to interpret the provisions of Union law on the protection of intellectual property rights.

The judgment of the CJEU is more in line with the French interpretation. The Court asks the Landgericht München I to find the right balance between the right to an effective remedy and the right to intellectual property, on the one hand, and the right to respect for private and family life, on the other.

The Court considers that such a balance is lacking when there is almost absolute protection for the family members of the holder of an Internet connection.

The court asks the Landgericht München I to verify the existence, in German law, of other means, procedures and possible remedies.

To be followed closely…

SOPERYAH IP

#IPLaw #FRLaw – Advantages and disadvantages of the provisions of the PACTE draft law (FR)

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For the record, the French government has made draft law to boost the French economy through business development. This is the PACTE (Action Plan for Growth and Transformation of Enterprises) draft law. The law was adopted at first reading by the National Assembly on October 9, 2018. We will do another a post to inform of the effective entry into force of the law.

Part of the law includes significant changes in French patent law, with a view to promoting its attractiveness.

For this part, the provisions of the draft law have advantages in the sense of attractiveness sought, but also disadvantages that may have a counterproductive effect.

The biggest positive effect would be an announcement effect, namely that companies hearing government’s efforts are more inclined to invest, expand their businesses and expand their portfoliosof IP rights; combined with effective improvement related to the other provisions of the law.

We will review these patent provisions in a synthetic way, with for each one, the current situation, the advantages and disadvantages:

1 °) The provisional patent application

This is the point that is most commented by people not aware of the legal issues of patent law. The relevant provisions have been removed from the draft PACTE Law to be introduced by regulation.

The aim is to bring it closer to the American system where applicants have the opportunity to file an application that does not necessarily fulfill the formal requirements, at reduced cost, without the filing being analyzed by the Patent Office (in our case the INPI). The applicant then has the opportunity to re-file the subject-matter of the provisional application one year later at the most, in due form.

The advantage could be a first quick filing to have an application date at a lower costs.

In the current system, as already discussed in a previous post, it is already possible to file a patent application without paying the official fees, to have a filing date and benefit from the effects of a provisional application.

Unfortunately, substantive issues usually arise. The costs of preparation and filing by an expert are intended to cover several subject-matters functionning in the same way as the preferred embodiment of the applicant, allowing to have a wide scope of protection, more difficult to circumvent.
If an applicant files a provisional (or definitive) patent application without the assistance of an expert, the description will likely be limited in terms of coverage, and it will be difficult or impossible to increase the scope of the patent application, as well as having a first filing date.

Therefore, whether for a provisional definitive or final application, the assistance of an expert is highly recommended for the drafting of the patent application.

A provisional application will therefore set specific rules, but the “provisional” effect can already be used today.

The implementation by regulatory means would be provided in 6 months according to a statement of Mr. Bruno LEMAIRE in September 2018.

2 °) Strengthening the quality of patents (examination of inventive step)

One of the important measures of the draft PACTE law is the possibility for the INPI to reject patent applications for non-invention (in particular for lack of technical effects) or for lack of inventive step (Article 42bis).
In the current situation, the INPI can reject a patent application only for manifest lack of novelty, as regards the conditions of patentability. Inventive step and the non-invention aspect are examined before the courts in case of litigation.

The advantage of this provision would be the issuance of patents that further satisfy the requirements of patentability. It would result mechanically that fewer patents would be issued by the INPI which benefits third parties and not applicants. This measure will probably lead to a decrease in the number of French filings, and deflate patent portfolios.

A common practice of having patents or parts thereof serving for a business purpose will be greatly limited. These patents still make it possible to be viewed by the customers as a company in a constant search for innovation even if there is not a breakthrough innovation every time. This currently benefits all types of applicants (SMEs and large groups).

This provision will result in an increase in INPI’s staff, an increase of analysis time and an increase of the time to issue the French patent. An increase of the INPI official fees is therefore to be expected. Similarly, the experts will have to spend more time on the files taking into account these changes of law, which will result in an increase of the consulting costs (in the current state, the expert checks that certain elements are indeed new and preferably inventive and confirms this to the client, without necessarily having to demonstrate inventiveness in detail to the INPI).

The entry into force is planned within two years after the promulgation of the PACTE law.

3 °) Opposition proceedings before the INPI

The opposition procedure will allow any third party with an interest in acting to question the validity of the patents issued by the INPI. If the mechanism used at the EPO is used, there will be some exchange of written arguments and then some oral proceedings.

In the current state, third parties only have the opportunity to file observations with relevant documents without being party to the proceedings and without any obligation to identify themselves or to prove an interest in acting . The third-party observations are possible 2 months after the publication of the patent application. Beyond that, you have to go to court.

The advantage would therefore be greater legal certainty for third parties, and standardization with other countries (namely the EPO, Germany, Italy, Spain, Switzerland, Austria, Sweden, Norway , Finland, the United Kingdom, Denmark, Japan and the United States).

This proposal seems to go in the right direction, but will necessarily, in the same way as above, impose associated procedural and advisory costs.

4 °) The promotion of the utility certificate

The utility certificate is a title similar to a patent but of reduced duration, and issued without examination of the INPI. The law aims at increasing its duration from 6 to 10 years (as in Germany), and to implement the possibility of converting an application for a utility certificate into a patent application.

Only in case of litigation, a search will be required. With the PACTE law, it can be envisaged that research will also be required with the said transformation.

The improved utility certificate will come closer to the current potentially non-inventive patent with a shorter lifetime, and without a search report by the EPO (making it possible to anticipate the outcome of a European filing on the same invention).

The measures are mainly administrative and should not lead to substantial increases in costs.

5 °) A great absentee of the proposals remains the designation FR-PCT

To date, the international applications to be validated in France are necessarily made through the EPO, and the European patent is then validated in France.

It would have been interesting for foreign applicants wishing to be protected only in some European countries to have the possibility of directly designating France. A direct designation is already possible in Germany and the United Kingdom namely, and this would be in preparation in Ireland, Italy and the Netherlands namely.

In conclusion, the government attempts through this means to stimulate the development of companies and the protection of their industrial property to reach the levels of other countries, including Germany. The most important lever would have been to change the minds of entrepreneurs namely by training the companies on the interests of the protection of intellectual property. Indeed, German entrepreneurs have quickly have the reflex to file a patent application while French entrepreneurs are more inclined to test the product on the market which is generally detrimental to the validity of a patent filed thereafter.

SOPERYAH IP

#IPLaw #USLaw – Judgment erasing damages due by APPE Inc. to the WARF (University of Wiscousing) (US)

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For the background of the case, the Wisconsin Alumni Research Foundation (“WARF”) sued Apple in january 2014, before the Wiscounsin District Court.

The WARF argued that Apple was infringing U.S. Patent No. 5,781,752, essentially concerning instructions executions in a predictive way by processors. The WARF argued that the A7, A8 and A8X integrated circuit chips infringed the patent in issue by their processors comprising a “Load-Store Dependency Predictor” (LSD).

As usual in these procedures, Apple has made a counterclaim for non-infringement and invalidity judgments of the patent in suit. In particular, U.S. Patent No. 5,619,662 was raised as a prior art anticipating predictive technology.

The District Court ruled in favor of the WARF regarding the novelty and the jury found the non-invalidity (ie: the validity of the patent), and the infringement of the patent. In addition, the jury has awarded the WARF, damages of more than 234 million dollars. Apple’s requests were rejected.

Apple appealed to the Court of Appeal of the Federal Circuit.

The Court of Appeal redid an analysis of the wording of the claims, in particular the use of the terms “particular” and “prediction”, the opinions of the experts of the parties and the arguments of the parties.

The Court of Appeal upheld the validity of the patent (in favor of the WARF), but also ruled in favor of APPLE because it overturned the decision on counterfeiting, awarding damages of over $ 234 million to the WARF.

This is a victory for Apple concerning the alleged infringement.

NOTE:
The patents in question (that of the WARF and the prior art) are protected only in the US, which shows that particular attention is required when entering the American market.

SOPERYAH IP

#IPLaw – Clauses of Twitter general conditions deemed illegal or abusive (FR)

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The validation of the general conditions is often done automatically. Thank God, associations of consumers and especially judges ensure the lawfulness and abusiveness of certain clauses not negotiated by “co-contractors”.

The French association Union Fédérale des Consommateurs – QUE CHOISIR (en abrégé UFC – QUE CHOISIR, et ci après UFC) has sued TWITTER (Company TWITTER Inc. (US) and Company TWITTER INTERNATIONAL COMPANY (IE)), before the Court of Grande Instance (TGI) of Paris on March 24, 2014 for many grievances regarding consumers in France, for the purpose of declaring an abusive or illegal nature of 269 clauses of the General Terms of Use and other Disclaimer (GCU) of the TWITTER platform.

the UFC asked, among other things:

  • € 1,000,000 for compensation for the non-material damage suffered by the collective interest of consumers;
  • € 1,000,000 in compensation for the material damage suffered by the collective interest of consumers;
  • € 55,000 under Article 700 CPC (court costs incurred by the party claiming reimbursement).

The decision of the TGI of 7 August 2018 is 236 pages long, and includes several legal points. Those who caught our attention are:

1 °) The 2014 and 2015 versions provided for a presumption of user liability for the published content, exempting TWITTER from its liability.

The TGI considers that “(…) the clause, which provides that the liability will be borne solely by the person who provided the content by fully exonerating the host, is unlawful as contrary to Article 6.I.2 of the law for confidence in the digital economy and abusive within the meaning of Article R. 132-1 6 °) become Article R. 212-1 6 °) of the code of consumption, the clause having the effect of abolishing or reducing the right to compensation for damage suffered by the consumer in the event of the breach by the professional of one of his obligations.“.

This clause has later been adapted to be limited to what is allowed by the country of residence of the user.

2) The 2014 and 2015 versions provided for a license for TWITTER of the content published by the user on the platform, including the right for TWITTER to sublicense.

The TGI considers that “Under the terms of Articles L. 131-2 and L. 131-3 of the same Code, the contracts by which copyright is transmitted must be established in writing, the transmission being subject to the condition that each of the rights transferred is mentioned separately in the deed of assignment and the area of ​​exploitation of the rights assigned is limited in scope and purpose, location and duration.
Article L. 133-2, which became Article L. 211-1 of the Consumer Code, provides that the terms of the contracts offered by the professionals to consumers must be presented and drafted in a clear and comprehensible manner.“.

The clause is considered illegal.

Surprisingly, this clause still seems to hold in the current GCU.

3 °) The GCUs provide for TWITTER, the possibility of unilaterally modifying the GCUs in a discretionary way, (…) without notice
nor justification.

The TGI considers that “by conferring on the company TWITTER the right to unilaterally modify the” TWITTER Rules “, to which the user must submit, without prior information of the user, the clause criticized is unlawful under Articles L. 111-1 and L. 111-2, Article R. 111-2 I and III, now Article R. 111-2 7 °) of the Consumer Code, Articles L. 121-17, L 121-19-2 and R. 111-2 become Articles L. 221-5, L. 221-6, L. 221-7 of the Consumer Code and abusive within the meaning of Article R. 132-2 6 °) become Article R. 212-2 6 °) of the Consumer Code, in that its purpose or effect is to reserve to the professional the right to unilaterally modify the clauses of the contract.“.

The clause is considered illegal.

The GCUs generate today, in most cases, an action of user acceptance, perhaps also as a consequence of the RGPD.

4) Certain clauses limit TWITTER’s responsibility for data security, in that TWITTER “strives to secure such data”.

The TGI considers that “Under Article 34 of the Data Protection Act on the protection of individuals with regard to the processing of personal data, the controller is required to take all necessary precautions, the nature of the data and the risks presented by the processing, to preserve the security of the data and, in particular, to prevent them from being distorted, damaged, or that unauthorized third parties have access to it, the data controller to guarantee a level of security adapted to the risk of the treatment.“.

The clause is considered illegal.

The court finds grossomodo in favor of the UFC, deciding that some of the clauses in question are deemed unwritten and some are unlawful. The court awards € 30,000 for non-pecuniary damage and rejects material damage for lack of justification.

To follow closely …

SOPERYAH IP