Update: intellectual property

There have been some fascinating intellectual property legal developments in the past few months and IP litigators have been kept busy. On the legislation side, the current timescale for implementation of the Digital Economy Act 2010 is uncertain, and indeed it has been a popular candidate for abolition on the government's new website 'Your Freedoms'.

L'Oréal: worth it?

With some reluctance, in June the Court of Appeal held that it had to follow the Court of Justice of the EU in a case involving cosmetics giant L'Oréal.

The case, L'Oréal v Bellure [2010] EWCA Civ 535, looked at products which smelled like L'Oréal perfume. Bellure issued a list showing which of their products were equivalent to L'Oréal's particular perfumes. L'Oréal said the list infringed its trademarks. Bellure said it was merely a legal comparative advertisement. The EU held that unfair advantage can be taken where people make a link between two products, even if there is no damage to the trademark or to its owner. The English court then said with regret it had to accept this ruling.

The judge said: 'Does trademark law prevent the defendants from telling the truth? Even though their perfumes are lawful and do smell like the corresponding famous brands, does trademark law nonetheless muzzle the defendants so that they cannot say so? I have come to the conclusion that the ECJ's ruling is that the defendants are indeed muzzled. My own strong predilection, free from the opinion of the ECJ, would be to hold that trademark law did not prevent traders from making honest statements about their products where those products are themselves lawful.' The judge did not like the way the EU had used terms such as 'free-riding' or 'riding on the coattails'.

Online marketing '“ Portakabin's key words

In July the Court of Justice of the EU (CJEU) reached its long-awaited decision in case C-558/08 (Portakabin). Last year, it decided Google did not breach the EU trademarks directive by allowing companies to buy a competitor's registered trademarked name so that their own name came up when that name was searched on a sponsored link. That is lawful. The other issue was whether the company buying that keyword breached the law.

A case last year involving Google again in the CJEU held that search engines do not breach the EU trademarks directive when they allow customers to purchase competitors' registered trademarks. This latest decision was about liability between the two competitors. It held there would only be a breach of registered trademark 'where that advertising does not enable average internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to by the ad originate from the proprietor of the trademark or from an undertaking economically linked to it or, on the contrary, originate from a third party'.

So, the test is whether the average user is confused as to origin. Someone searching for Slaughter and May lawyers, which is shown as a clearly marked 'sponsored link' of a different firm, as well as in the natural search results for the solicitor's firm, is not going to be confused. But, if that sponsored link is www.s-may.co.uk, they may well be. This is a very common issue in practice for internet lawyers as increasing volumes of customers and suppliers move online. Or will this be interpreted to assume the average user is not very savvy and if they search for Slaughter and May then any link which comes up, whether referred to as sponsored or not, and whether it looks completely different from the name searched would confuse users, enough use could be stopped? I don't think so '“ unless the names are similar, most users will not be confused.

But Google also seems to think so because in August they announced they would now allow people in more EU states to 'buy' competitors' trademarks as key words following the CJEU's decisions. In this case, a company named Primakabin bought the name of better-known firm Portakabin as key words. The court held that use of a sign identical with another person's trademark in a referencing service is not liable to have an adverse effect on the advertising function of the trademark. 'The function of indicating the origin of the mark will be adversely affected if the ad does not enable normally informed and reasonably attentive internet users, or enables them only with difficulty, to ascertain whether the goods or services referred to by the ad originate from the proprietor of the trademark or an undertaking economically linked to it or, on the contrary, originate from a third party,' states the judgment.

Asda's 'malicious' sweetener

Asda has fought off a claim by producers of the sweetener aspartame, which had alleged that Asda misled customers about the ingredient. In the Court of Appeal case, Ajinomoto Sweeteners Europe v Asda Stores [2010] EWCA Civ 609 (solicitorsjournal.com, 17 June 2010), it was held that in cases of malicious falsehood, rules were different for libel claims. Ajinomoto maintained that Asda's labelling of Asda products suggested that aspartame was harmful and that this was a 'malicious falsehood'. Some packets said Asda's products had no 'hidden nasties' and 'no artificial colours or flavours and no aspartame'. However, the case may go back to the High Court to determine whether large numbers of consumers would read the words as meaning that 'there is a risk that aspartame is harmful and unhealthy'. The company will have to show malice and falsity on the part of Asda.

Privacy rights in marriage

In Tchenguiz v Imerman [2010] EWCA Civ 908, brothers who wanted to protect their sister on her divorce obtained information from computer systems in the office premises they shared with her husband. The High Court held they could not retain and use the information in the divorce proceedings. They should have obtained an Anton Pillar order without notice to carry out a search. However, the information was not simply handed to the husband. His lawyer was ordered to retain it and check that the husband's financial information disclosed on Form E on the divorce tallied with what was obtained; a victory of sorts for the brothers for practical purposes.

Although divorce lawyers will find the judgment of most interest, it is also of note for IT and privacy lawyers. It includes passages about the rights of husbands and wifes over the last 200 years and the differences between some couples in marriage '“ some with total openness to the other about all their affairs and others with locked cupboards, passwords and many secrets: 'The notion that a husband cannot enjoy rights of confidence as against his wife in respect of information which would otherwise be confidential as against her if they were not married, seems to us to be simply unsustainable. The idea that a husband and a wife should be regarded as a single unit in law was a fiction which the law has been abandoning for a long time.'

AstraZeneca's abuse of dominance

In July, the EU General Court (which until December 2009 was called the Court of First Instance) ruled that AstraZeneca delayed the sale of competitors' drugs using tactics that, because of the company's position in the pharmaceutical market, amounted to an abuse of dominant position. The court upheld a decision that the company had abused its dominance in the anti-ulcer drug market to stop generic companies competing with it. However, the court reduced the total fines from ‚¬60m to ‚¬52.25m.

It had misled patent-granting authorities in the 1990s as it wanted to increase the life of its patents on Losec, the world's then best-selling drug. It also used the system to delay the ability of competitors to release rival drugs: 'AZ adopted a consistent and linear course of conduct, characterised by the communication to the patent offices of misleading representations for the purposes of obtaining the issue of [patent extensions] to which it was not entitled (Germany, Finland, Denmark and Norway), or to which it was entitled for a shorter period (Austria, Belgium, Luxembourg, Ireland and the Netherlands),' said the decision, adding: 'AZ's deregistration of the marketing authorisations was only such as to prevent applicants for marketing authorisations in respect of essentially similar medicinal products from being able to make use ofthe abridged procedure'¦ and, therefore, to obstruct or delay the market entry of generic products.'

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