Tag Archives: Intellectual property

What is an IP strategy and why is it important?

There is a growing interest among CEOs in Spain in adding an IP strategy to their agenda, an element that has a direct impact on the profit and loss account and which is also closely linked to investments in innovation and marketing.

A well-designed and well-executed IP strategy facilitates the transformation of resources such as inventions, innovations, ideas, know-how and data into intangible assets, that is, patents, trademarks, industrial designs and copyright, thereby boosting and adding value to a company’s business portfolio.

Digital transformation, virtual communication and new technologies allow us to open up the creative process to all areas of the company, not just to the departments usually responsible for these matters.

Why is it so important for a company to implement such a strategy?

There are many legal and strategic reasons for doing so, although the key factors are determined by the sector and the degree of global competitiveness of the company.

By way of example, we may highlight the following factors, which have an important strategic influence:

  • These new intangible resources or assets help to foster a culture of permanent innovation within the company.
  • Competitors can be prevented from taking advantage of our progress and/or undermining our competitive advantage by means of different legal instruments for protection, such as, obtaining patents or industrial designs, implementing trade secret plans, protecting proprietary software, domain names, copyright, trademarks, etc.
  • We can benefit from the strength and legitimacy of intangible assets in new markets when the company has plans for international expansion.
  • A company’s branding strategy serves to build up and shape its brand and position its goods and services in the marketplace.
  • Discouraging professional or amateur counterfeiters from copying our products.
  • These assets may be transferred, licensed, sold and valued, increasing the company’s stock value, and helping to establish a stronger position in the financial markets.
  • They can be capitalised on the balance sheet and amortised, and may also offer fiscal advantages.
  • The cost of hiring experts to carry out the processes of transforming ideas into intangible assets can be recorded as deductible expenses by companies.
  • Without intangible innovations, companies cannot access national and European subsidies.

All of the above factors lead to the idea that an IP strategy could be an interesting prospect for a company. I encourage you to take up the challenge.

Author:Pilar Soriano

Visit our website: http://www.elzaburu.es/en

Criminal conviction for storage for commercial purposes of goods infringing copyright, even in storage facilities separate from the place of sale

Source: Pixabay

The judgment of the CJUE (Case C-572/17) of 19 December was issued within the context of a request for a preliminary ruling from the Swedish Supreme Court in criminal proceedings brought by the Public Prosecutor’s Office of this Court against Mr. Imran Syed concerning the infringement of trade marks and infringements of copyright in literary and artistic works. 

Mr Syed ran a retail shop in Stockholm (Sweden) in which he sold clothes and accessories with rock music motifs. In addition to offering the items for sale in that shop, Mr Syed stored such goods in a storage facility adjacent to the shop and in another storage facility located in Bandhagen, a suburb of Stockholm. It is established that Mr Syed’s shop was regularly restocked with merchandise from those storage facilities.

The issue arising was whether goods stored by someone in a warehouse and bearing a protected motif could be considered as being on sale whenever there are identical goods on sale in a retail establishment run by such person.

In this judgment the CJUE recalls that such an act can constitute an infringement of the exclusive distribution right (Article 4(1) of Directive 2001/29) even if that act is not followed by the transfer of ownership to a purchaser of the protected work or a copy thereof (expressly citing its judgment of 13 May 2015, Dimensione Direct Sales and Labianca, C‑516/13). Therefore, an act prior to the actual sale of a work or a copy thereof protected by copyright, which takes place without the rightholder’s consent and with the objective of making such a sale, may infringe the distribution right. Although carrying out the sale is not a necessary element for the purpose of establishing an infringement of the right of distribution, it must nonetheless be proven that the goods concerned are actually intended to be distributed to the public without the rightholder’s consent, inter alia by their being offered for sale in a Member State where the work at issue is protected.

The fact that a person, selling goods bearing copyrighted motifs in a shop without the rightholder’s authorisation, stores identical goods, may be an indication that the stored goods are also intended to be sold in that shop and that, accordingly, that storage may constitute an act prior to a sale being made, which is liable to infringe that rightholder’s distribution right.

Although the distance between the storage facility and the place of sale may constitute evidence that can be used in seeking to establish that the goods concerned are intended to be sold in that place of sale, that evidence cannot, on its own, be decisive. It may, on the other hand, be taken into account in a concrete analysis of all the factors likely to be relevant, such as, for example, the regular restocking of the shop with goods from the storage facilities at issue, accounting elements, the volume of sales and orders as compared with the volume of stored goods, or current contracts of sale.

The judgment finally rules that the storage by a retailer of goods bearing a motif protected by copyright on the territory of the Member State where the goods are stored may constitute an infringement of the exclusive distribution right when that retailer offers for sale, in a shop without the authorisation of the copyright holder, goods identical to those which he is storing, provided that the stored goods are actually intended for sale on the territory of the Member State in which that motif is protected. The distance between the place of storage and the place of sale cannot, on its own, be a decisive element in determining whether the stored goods are intended for sale in the territory of that Member State.

Once more, with this judgment the CJUE imposes order regarding the problem of copyright-infringing acts or means, prior to the sale of goods, that regrettably and painfully affect creators far too frequently.

  Author: Juan José Caselles

Visit our website: http://www.elzaburu.es/en

Battle between rightholders and internet users

(Source: Pixabay)

Since it was published in 2016, the proposal for a Directive on Copyright in the Digital Single Market has turned into a showdown between IP rightholders and Internet users, the latter brought together and represented by the main Internet user associations.

The proposed Directive, as its name suggests, was created with the aim of harmonising and adapting copyright law to the new uses and exploitation models of intellectual creations inherent to the Internet age and new technologies.

The Internet, traditionally an information source for the average user, is now increasingly a means of expression. Every day, millions of Internet users share (by means of tweeting, retweeting, tagging) all kinds of content: photos, videos, text, memes, comments. Problems arise when the content being shared has an owner and permission has not been sought or, in more serious cases, when a third party is making a profit from content shared, perhaps innocently and in good faith, by the user.

The amendments to the text of the proposal for the Directive, adopted by the European Parliament in September, to a large extent reflect the feelings of authors, artists, publishers and other rightholders who are desperately trying to put an end to the culture of sharing something that belongs to someone else in a space where it seems that freedom of expression has to prevail over any other right.

In the parliamentary debate, the bone of contention (or at least one of them) was the issue of the obligation of service providers that share content online to reach agreement with rightholders to avoid users of these platforms being able to upload content protected by copyright or to ensure that, if they do so, the rightholder receives due payment.

Up to now, this type of provider (YouTube, for example) was only obliged to put in place mechanisms for withdrawing content in cases in which the rightholder had reported the providing of protected content (the so-called notice and take down protocol). If the wording of Article 13 adopted by the Parliament is ultimately accepted, it seems that providers of these services will be obliged to carry out prior monitoring and filtering of the content that users wish to upload.

This Article 13 has come under heavy criticism and has been described by certain groups as an attack on freedom of expression and on diversity of opinion online. A review of the full text of the provision and the related recitals should lead to a more moderate view, given that the filtering obligation will only affect those providers acting for profit-making purposes, storing and giving the public access to a large amount of protected works and which are not small or medium-sized businesses. The provision expressly excludes online encyclopedias and scientific or educational repositories.

The amendments to Article 11, which provide for the establishment of a remuneration for press publishers for the digital use of their publications, have generated similar reactions. This is not a new development for Spain, given that since 2014, its own Copyright Act has included a provision for what has become popularly known as the “Google tax”, which in fact led said company to withdraw the Google News service in Spain. The EU provision is considerably less strict than that in Spain, given that it limits the obligation to provide remuneration to 5 years, whereas the provision in Spanish legislation does not set a specific time limit.

The controversy generated by these two provisions has overshadowed other no less important matters that are introduced for the first time in the text of the Directive following the parliamentary debate of 12 September.

One of them is the creation of a right to revoke for authors and performers who have transferred their rights on an exclusive basis. Article 16 imposes on Member States the establishment of rules permitting creators to recover their rights if, after a reasonable time (which shall vary, depending on the type of exploitation involved), the exclusive licensee has not exploited the work. In the case of Spain, this obligation will finally give meaning to and transform into a specific and real obligation the theoretical obligation on exclusive licensees set out in Article 48 of the Consolidated Version of the Copyright Act.

Another matter that has attracted little attention, if not gone unnoticed, is that of recognition of intellectual property rights for organisers of sports events. Article 12 a) does not specify what is to be understood by “organiser of a sports event”, or even what constitutes a sports event, which is in itself a sufficiently broad term to cover all kinds of interpretations.

In any case, the battle does not end here. The final text will be voted on in a plenary session of the European Parliament at the beginning of next year, and only after it has been agreed upon by the Parliament, the Commission and the Council. Until then, it is to be assumed that swords will remain drawn on both sides.

Author: Patricia Mariscal

Visit our website: http://www.elzaburu.es/en


Low cost luxury? Judgment comes down on imitations of a Longchamp handbag

Summary of commentary on judgment No. 401/2017 of 15.9.2017 by the Provincial Appellate Court of Madrid (ECLI:ES:APM:2017:14041), published in the “Revista de Derecho de la Competencia y de la Distribución” [Competition and Distribution Law Magazine]

The conflict arose as the result of the sale on the GROUPON website of some vouchers that could be exchanged for handbags from the company SARASWATI (doing business as PRISAUK), whose design was reminiscent of LONGCHAMP’s 1623 LE PLIAGE model (hereinafter “LE PLIAGE) and the offering of which was accompanied by promotional phrases such as “dale un toque francés a tu outfit con un bolso plegable de estilo Longchamp” [give your outfit a French touch with a Longchamp style foldable handbag] or “bolso plegable de estilo Longchamp, lujo asequible con un toque francés” [Longchamp style foldable handbag, affordable luxury with a French touch].

Shown below is a comparative image with Longchamp’s LE PLIAGE handbag model and the handbags sold by SARASWATI on GROUPON and on its PRISAUK website:

Top left: Red LE PLIAGE handbag / Top right: “BENZI” handbag sold on the website www.groupon.es

Bottom left: Beige LE PLIAGE handbag / Bottom right: “PRIASUK” handbag sold on the website www.priasuk.es

In view of the above sale of goods, CASSEGRAIN, as the owner of the intellectual and industrial property rights in the LONGCHAMP handbags and trademarks, and LONGCHAMP, as the manufacturer and exclusive distributor of the handbags, instituted proceedings against SARASWATI and GROUPON on the grounds of trademark and copyright infringement and unfair competition.

Specifically, the complainants claimed that the LE PLIAGE handbag warranted protection as an applied work of art and that the model sold by SARASWATI was a reproduction of said handbag.

Furthermore, they considered that the use on the GROUPON website of the LONGCHAMP trademark and of expressions such as “lujo asequible con un toque francés” [affordable luxury with a French touch], made reference to the origin and position in the marketplace of the LONGCHAMP trademark and constituted an infringement of said trademark, which is, moreover, well known in its sector.

Finally, the complainants considered that the use of promotional phrases such as “estilo LONGCHAMP” [LONGCHAMP style] constituted an act of imitation, exploitation of another party’s reputation, unlawful advertising and misleading acts capable of generating confusion or association, as referred to in the Unfair Competition Act.

In turn, the defendants disputed the well-known character of the LONGCHAMP trademark and that the LE PLIAGE handbag could be considered a work. Moreover, GROUPON tried to assert the exemption from liability provided for under the Law governing e-commerce, claiming that they had simply reproduced the description provided by SARASWATI and that they were unaware of the unlawful nature of the information on their website.

  1. Findings of the first-instance judgment.

On 18 November 2015, Madrid Mercantile Court No. 9 handed down a judgment dismissing the claims concerning exclusive rights, intellectual property rights in the handbag and trademark rights in LONGCHAMP, but accepting the claims concerning acts of imitation and misappropriation of another party’s reputation.

Specifically, the judge of the lower court held that it had not been demonstrated that Longchamp’s LE PLIAGE handbag model had the sufficient degree of originality and creativity to be considered a work under the Copyright Act and that since the LONGCHAMP trademark had not been used on the product but rather in the advertising, there had been no trademark infringement either, but rather acts of imitation and misappropriation of another party’s reputation, pursuant to Articles 11 and 12 of the Unfair Competition Act. The judge also concluded that GROUPON could not benefit from exemption from liability under the Law governing e-commerce, given that it had been proven that the design of the advertising of the handbags in dispute had been undertaken jointly between SARASWATI and GROUPON.

  1. Summary of the findings of the judgement of the Provincial Appellate Court of Madrid and commentary synopsis.

The judgment of the Mercantile Court, appealed both by the complainants and by GROUPON, led to the judgment of 15.9.2017 by the Provincial Appellate Court of Madrid, which overturns the Mercantile Court’s judgment almost in full, finding that the sale of the handbags on GROUPON’s website infringed the copyright in the LE PLIAGE model and the well-known trademark LONGCHAMP.

The full commentary, which may be accessed in issue number 22 of the Revista de Derecho de la Competencia y de la Distribución [Competition and Distribution Law Magazine], offers a detailed analysis of the main findings of this judgment, dealing with important issues for the fashion sector (“Fashion Law”), such as the protection of creations in this field under copyright (in this case Longchamp’s “Le Pliage” handbag model), the possible infringement of a well-known trademark when used in advertising accompanied by expressions such as “estilo”, “tipo”, “imitación” [style, type, imitation], the principle of the somewhat complementary relationship between the regulations governing exclusive rights and Unfair Competition law, and the liability of information society service providers in relation to such possible infringements.

  Author: Cristina Velasco

Visit our website: http://www.elzaburu.es/en

Fashion Law. Fashion 4.0: Websites, Apps & Social Networks (XI)

ELZABURU has had the pleasure of working together with the publisher Thomson-ReutersAranzadi on Fashion Law, a pioneering work in Spain on the subject of fashion law, which was presented on 16 April.

In these short weekly summaries, the professionals at ELZABURU who participated in the work offer us a brief outline of their contributions:

Fashion 4.0. Websites, Apps & Social Networks: protection and Defence

The digital age has had a profound effect the world of fashion, transforming the way it designs, sells or communicates. No one can now operate solely through traditional channels and must reach out to consumers via online media.

Therefore, it is crucial to limit the risks and protect the intangible assets of the business.

In this regard, holding the exclusive rights to a domain identifying the business is extremely important, particularly with a view to preventing its use by third parties. To obtain exclusive rights, the domain must be registered before the corresponding body, depending on the domain of interest, which may be national (.es, .us, .uk, etc.) or generic (.com, .net, .biz, etc.).

The content, appearance and layout of a website can also be protected. Any original content included on the website (images, text, videos, illustrations, etc.) are protected by the Copyright Act. This protection also extends to the content uploaded to social networks, as it is considered equivalent to that included on corporate websites. Similarly, websites from which data and information are extracted or compiled can be protected as databases, either as a work or as a sui generis database right, provided that the investment made by the owner is duly accredited, the latter form being the more usual.

All this must be supported by a contractual protection strategy, with website use policies being an ideal tool to restrict the reuse of the intangible assets of the business.

The protection of mobile apps has a similar structure to that of websites with regard to their content, the main difference being that an app may additionally be protected as a computer programme or software, in accordance with the provisions of the Copyright Act.

Finally, it is important not to overlook the registration of those trademarks used to identify the business on online platforms.

The reality is that this digital revolution is constantly evolving, posing new challenges and strategies focussed on improving the customer’s experience, in adapting physical shops to new technologies, experimenting with chatbots, customising garments through technical developments in the materials used, as in the case of sportswear, whose technical features are adapted to the requirements of top-level athletes, or the design of clothing whose colours depending on the weather conditions, while adapting business models in line with new sustainability objectives or targeted improvements in environmental conditions, for instance, through the use of renewable energies in the manufacture of garments or that of new, low-impact means of production.

Author: Martín Bello Castro

Visit our website: http://www.elzaburu.es/en

Blog entries in the series Fashion Law:

1.Trademark protection in the fashion sector (23.04.2018)

2.Design protection in the fashion sector (30.04.2018)

3.Patent protection in the fashion sector (07.05.2018)

4.Protection of fashion through copyright (21.05.2018)

5. Image rights in the fashion sector (28.05.2018)

6.Fashion Law. Data Fashion (04.06.2018)

7.Counterfeiting in the fashion sector (11.06.2018)

8.Exhaustion of rights in the fashion sector (18.06.2018)

9.Corporate reputation in the fashion sector (25.06.2018)

10. Protection of the commercial imagen of a fashion brand (04.07.2018)

11. Websites, Apps & Social Networks (13.07.2018)

12. Valuation of intangible assets (17.07.2018)

13. Licensing (06.09.2018)


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