Publications
European IP Bulletin, Issue 3, July -
Copyright
Copyright
6. Linux creator speaks out on Digital Rights Management
‘Digital rights management’ (DRM) describes a number of techniques available to control and monitor use of works, particularly on the internet; sometimes to ensure payment for use or to limit its extent, sometimes with emphasis on attribution or authenticity. Linux says that some DRM systems may be compatible with open source policies.
The ‘open source software’ movement makes human-readable source code to its software freely available, permitting others to correct the software and to build upon it in creating new programs. It provides alternatives to the proprietary software of organisations such as Microsoft, which rely upon copyright protection of their products. Although copyright subsists automatically in original works, including software, much open source software is released by its copyright owners under the terms of the GNU GPL (General Public License) which protects the software from becoming part of a closed-source project. Such releases are often described as ‘copyleft’ (as opposed to ‘copyright’). The open source ‘GNU/Linux’ computer operating system is centred on a ‘kernel’ devised by the Finnish programmer Linus
Torvalds. Torvalds has recently caused a stir by countenancing the use of Digital Rights Management (‘DRM’) with Linux. He has been quoted on the BBC website quoted as saying "DRM is perfectly ok with Linux", although it appears that he endorses the use of only "some of the emerging technologies for digital rights management with Linux-based systems". Digital Rights Management is often thought to be inimical to the ethos of the open source movement; however, Torvalds states that DRM techniques are neutral and capable of being used in ways consistent as well as inconsistent with open source philosophy.
We may look forward to further views on DRM from the open source community, from the commercial software organisations and from organisations affected by DRM, especially copyright collecting societies. The latter may use DRM to automate their management of authors’ rights but are also threatened by use of DRM by media conglomerates.
7. Breach of confidence, alternatively copyright infringement?
Cray Valley Limited v Deltech Europe Ltd., John Scanlan & Cristopher Riley, [2003] EWHC 728 Cray Valley Limited, claimed breach of confidence and alternatively copyright infringement against the defendants. The court found that although on the facts the documents were not confidential, they were copyright, so while their content could be appropriated they could not lawfully be copied.
Cray bought a coating and structural resin business from a company called Borden, where the second and third defendants had been employed. The sale transaction only included information of manufacturing formulations and ingredients and all ongoing contracts and customers of Borden; Borden separately sold the site and plant and machinery to Deltech Europe Limited. Deltech chose to retain some employees of Borden including the second and third defendant.
Cray alleged that the second defendant downloaded confidential information from the computer when he was an employee of Borden and used that information while working for Deltech, consequentially causing harm to Cray’s business.
The Court held that the information retrieved by the second defendant lacked the quality of confidence as most of it was published or was in public domain: it was commonly known to the industry, as deposed by the industry experts during the trial. The Court employed a criterion from the US Uniform Trade Secrets Act 1979, which states that one of the factors determining whether an information is a protectable trade secret or not is the measures taken by the owner to protect secrecy of information. Since there were no restrictive covenants placed by Borden between the second and third defendants during their employment by Borden, and the documents were freely accessible and were not marked ‘confidential’, the Court held that Borden never considered such information to be confidential.
Lastly, since Cray neglected to take all the documents from the site of Borden within the stipulated period, the Court held that Cray’s conduct inferred that they too thought the information to have no or little economic value.
However, with regard to copyright infringement, the Court held that if Cray owned copyrights in the information, it would amount to unlicensed copying. Since there had been many business transfers before Borden got hold of the information, the Court stated that it was difficult to ascertain whether copyrights were assigned or not during such transfers. The Court held that s.90(3) of the Copyright, Patents and Designs Act 1988 contemplates a valid copyright assignment to be in writing, but a mere clause transferring all ‘assets’ would amount to an effective and valid copyright assignment.
The Court held that though the defendants had not breached any confidence, they had infringed copyrights of Cray. This case demonstrates the interwoven and inalienable relationship existing amongst the different intellectual property rights.
8. EasyInternet café settles over music rights
EasyInternet has paid £210,000 in damages and legal costs to the UK record industry in an out-of-court settlement for running unlicensed CD-burning of music downloads in its stores.
At the end of January 2003, a High Court summary judgement issued by Justice Peter Smith found easyInternet Café, which is part of the Easy Group founded by the Greek entrepreneur Stelios Haji-Ioannou, guilty of copyright infringement.
The case was brought by the British Phonographic Industry (BPI) on behalf of a number of major labels. BPI had taken legal action after learning that the company had launched a promotion which enabled customers to come into the café and download information which could include music tracks on to a central server. An easyInternet employee would then burn the downloaded information onto a CD for the customer to take away, for £5. The BPI argued that the downloading of sound recordings from the internet without the record label’s consent infringed the copyright in the sound recordings contrary to the Copyright Designs and Patents Act 1988.
During the court case, Justice Peter Smith rejected the defence of easyInternet that it should not be held responsible for what its customers did while using its computers and that downloading music was no different to recording a television program to watch later. He found easyInternet liable for damages for breach of the Copyright Designs and Patents Act 1988.
Mr Haji-Ioannou, who had first stated that he would contest the court’s decision on the time-shifting issue, agreed to pay £80,000 in damages for copyright infringement and £130,000 in legal costs to the record industry in an out-of-court settlement, bringing the total to £210,000.
He said that "The BPI originally asked for £1 million in damages, so at least they’ve settled for a 92 per cent reduction. Every case has a settlement value. We could have spent the next year in court arguing the legal point, and that’s what I think they got scared of. I’m glad I can move on."
"Illegal copying jeopardises the livelihoods of artists and songwriters as well as putting at risk the thousands of jobs directly and indirectly created by the recording and publishing of music" said Peter Jamieson, the BPI’s executive chairman. "We are delighted that we have won this ruling which sets an important precedent in support of authorised licensing services."
9. Dutch court blocks Harry Potter-like books
In April 2003, a Dutch Court found in favour of J.K. Rowling, the author of the Harry Potter series and prohibited the distribution of 7000 copies of a book by Russian author Dimitry Yemets entitled "Tanya Grotter and the Magic Double Bass". The text was found to be an infringing adaptation, not a non-infringing parody.
J.K. Rowling, her Dutch publisher Harmonie and the U.S. company Time Warner Entertainment, which made the Harry Potter movies took action to prevent the release in the Netherlands of 7,000 copies by the Dutch publisher Byblos of the first western edition of a Russian book by Dimitry Yemets.
Rowling asked the court to stop the publication of Dimitry Yemets’ tale about a girl wizard entitled "Tanya Grotter and the Magic Double Bass", which her lawyers say copies her book "Harry Potter and the Philosopher’s Stone". There are striking plot similarities between the two books: both Harry Potter and Tanya Grotter are orphans of murdered parents with magical powers who attend wizarding schools and have unusual scars on their faces. They wear glasses and fight against terrible enemies with two close friends and their mentor.
Rowling’s lawyers alleged copyright and trade mark infringement and plagiarism. Indeed, they argued that Tanya Grotter and the Magic Double Bass not only copied the storyline of Harry Potter and the Philosopher’s stone, but also the plot and the characters. They said that Yemets "knowingly and openly copied the leading 10 characters in the Harry Potter stories, only changing their names".
On the other hand, Dimitry Yemets, who has already sold more than a million copies of his Tanya Grotter books in Russia argued that his work is a parody, putting Harry Potter in a Russian context. The Dutch publisher Byblos commented Tanya Grotter was a "cultural response to the world hype about the mega best-seller".
On 3 April 2003 the Amsterdam District Court found that Yemets’ "Tanya Grotter and the Magic Double Bass" was an unauthorised adaptation of "Harry Potter and the Philosopher’s Stone" by Rowling. It rejected the argument that the book was a parody and ruled that its publication would violate copyright and trade mark laws. As a consequence, the court agreed to block publication of 7000 copies of Yemets’ book by Dutch company Byblos.
Although the judgment will do nothing to stop the spread of Tanya Grotter in Russia, it fires a warning to publishing house in Europe, Asia and the United States to stay away from Tanya Grotter.
10. Registered Community Designs come on stream as of 1 April 2003
The Office for Harmonisation in the Internal Market (Community Trade Marks and Designs Registry) (OHIM) has begun processing applications to register Community Designs and has issued draft examining guidelines for consultation.
Council Regulation (EC) 6/2002 of 12 December 2001 on Community Designs establishes a mechanism for the protection of designs EU-wide. The 3-year unregistered design rights provided by Art 11 came into being 60 days from the effective date of the Regulation, and provide protection against copying. Further implementing legislation and administrative arrangements were necessary to set up procedures for registration of Community Designs at the OHIM in Alicante, Spain. The first registration date for Community Designs will be 1 April 2003. According to Art 111.3 of the Community Design Regulation, applications for registered Community designs filed within the three months leading up to that date are deemed to have been filed on 1 April. Registered designs have longer duration, of up to 25 years (Art 13) and more stringent infringement rights (Art 19).
OHIM has issued a circular letter to international non governmental organisations setting out its Draft Guidelines for examining Community Design applications. The guidelines spell out how OHIM proposes to apply Regulation 6/2002 as well as Implementing Regulation 2245/2002 and Fees Regulation 2246/2002. Comments are invited, with a deadline of 27 June 2003 for submission. It is proposed to issue the Guidelines in their final form in November 2003.
11. New German Design Law Proposed
Germany has not yet implemented Directive 98/71/EC on the legal protection of designs which was supposed to be implemented by 28 October 2001. The venerable law of Designs and Models law of 1876 (as amended) is still in force in Germany. On 26 March 2003, the council of German Federal ministers approved and published a bill for the reform of German design law.
Harmonisation will result in the lowering of thresholds for design registration in Germany and a shift from a copyright approach (albeit copying may be presumed if a design has been made available to the public) to full exclusive rights for registered designs. Examination as to certain substantive requirements will be introduced. A 12-month general grace period will be available. Protection will be available for a broader range of subject-matter.
The ownership rules appear set to change. Formerly, any person creating a work in exchange for compensation was entitled to industrial property in a design. In future transactions, care will have to be exercised to ensure that rights are transferred. However, an employer will still be entitled to rights in designs created by employees in the course of their work, but the employee will have the right to be identified as the designer.
In accordance with existing German law, multiple applications may be made, and it will be possible to file for up to 100 designs for products in the same class.
12. UK amends Registered Designs Act to accommodate Registered Community Designs
In 2001 the Registered Designs Regulations 2001 (S.I. 2001 No. 3949) amended UK design law to conform with the harmonising requirements of Directive 98/71/EC on the legal protection of designs (OJ L289/ 28). On 1 April 2003 it became possible to register Community Designs with effect for the whole EU (see previous item). Some consequential changes to UK national law were needed and these have been put in place by the Registered Designs Regulations 2003 (SI 2003/550). The new UK Regulations were laid before Parliament on 7 March 2003 and they came into effect in 1 April 2003. The main change is to allow refusal or invalidation of a national registered design on the ground of a prior Community registration (Art 11 of the Directive), with appropriate transitional provisions.
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