- Patents Bill published on 16 January. The Bill proposals aim to provide a more supportive framework, particularly for small businesses, to enforce patent rights and ensure that UK patent law continues to underpin and promote innovation.
The Bill is available at: www.publications.parliament.uk/pa/pabills
The DTI and the Patent Office consulted widely on the changes during 2003. The Public Response Document to the consultation explains the proposals in more detail; and was published on 14 November 2003. It is available at:
www.patent.gov.uk/about/consultations/responses/patact/index.htm
- Microsoft to pay Eolas $520 m in damages (16 January 2004) as a Chicago federal judge upheld a jury verdict that ordered Microsoft to pay $521 million to the University of California and Eolas Technologies for patent infringement. Microsoft's motion to suspend a decision until the US Patent and Trademark Office (PTO) completes a re-examination of the patent was also denied.
Although Microsoft was barred from distributing versions of Internet Explorer that include the potentially infringing technology, the injunction has been held until an appeal has run its course.
The patented technology concerned was developed by Eolas president Michael Doyle at the University of California at San Francisco. Eolas, which stands for Embedded Objects Linked Across Systems, jointly holds the patent with the University of California.
See: www.computerweekly.co.uk
- Communication from the Commission (COM (2003) 821) on 23 December 2003 to the European Parliament and the Council on the implementation by the EC of the "Bonn Guidelines" on access to genetic resources and benefit sharing under the Convention on Biological Diversity. The Guidelines were adopted at the 6th Conference of the Parties of the Convention on Biological Diversity (CBD) in April 2002. The communication provides an overview of EC policy approach to and measures on access and benefit sharing, including in the framework of the EC Biodiversity Strategy, in relation to the EC Directive on the legal protection of biotechnological inventions and the Regulation on community plant variety rights.
See: http://europa.eu.int/comm/secretariat_general/regdoc/liste.cfm?CL=en
- Proposal for a Council Directive (20 December 2003) amending Directive 2003/49/EC on a common system of taxation applicable to interest and royalty payments made between associated companies of different Member States. The draft Directive submitted on the basis of Article 94 EC Treaty aims to amend the Interest and Royalty Directive (Directive 2003/49/EC) to ensure that there are no loopholes in the provisions of the Directive allowing for circumvention of taxation of interest and royalty payments. The Commission has also presented two proposals for the amendment of Council Directives in the area of direct taxation, the Parent-Subsidiary Directive (COM (2003) 462 final) and the Merger Directive (COM (2003) 613 final).
See: http://europa.eu.int/comm/secretariat_general/regdoc/liste.cfm?CL=en
- DTI publishes an innovation report (17 December 2003), competing in the global economy: the innovation challenge, setting out the steps which the government will take to facilitate the growth of innovation in the UK.
The report highlights where the UK is currently failing to support innovation, namely its failure to invest adequately in research and development and in patenting its technology, compared to R&D investment and patenting in other countries within the EU, the US and Japan. The overview of the report concludes:
"We live in a fiercely competitive global economy. If we are to enhance our productivity and raise out standards of living we need to improve radically our innovation performance. And we need to innovate continuously in the future so that we can hold our own against the fast-moving new economies."
Go to www.innovation.gov.uk for a copy of the report.
- Ultraframe UK Ltd v G J Fielding & ORS [2003] EWCA Civ 1805 (12 December 2003). A 100% shareholder was not an employee commissioned to produce designs (s. 215 Copyright Designs and Patents Act 1988) but he was acting for the company and held the designs in trust for the company.
- CBI praises the Lambert Report (4 December 2004) on university business links but criticises conclusions on ownership of intellectual property rights.
For press release see: www.cbi.org.uk
To view the Lambert Report see:
www.hm-treasury.gov.uk/media//EA556/lambert_review_final_450.pdf
- R Griggs Group Ltd & ORS v Ross Evans & ORS [2003] EWHC 2914 (2 December 2003). Claimants were entitled to beneficial ownership of the logo created for them by a freelance designer and not merely an exclusive licence.
The claimants manufactured and sold "Dr Martens" boots. The combined logo incorporating Dr Martens (registered trade mark used by the claimant under licence) and Air Wair (claimants registered trade mark) was designed by a freelance graphic designer (the first defendant). The second and fourth defendants took an assignment of copyright from the first defendant. The claimant sought a declaration that he was the beneficial owner of the copyright in the combined logo.
Held that when a freelance designer was commissioned to create a logo for a client it would be normally be necessary to imply a term assigning copyright beneficially to the client in order for him to be able to prevent others from using the logo. The designer was the first owner of the copyright. In the circumstances it was obvious that the right to use the logo and to exclude others from using the logo was to belong to the claimant and not the designer. The beneficial title belonged to the claimant. What was to be implied was aright to use the copyright in favour of the designer and not merely an exclusive licence.
- European firms are being urged by the SCO to buy a licence for Linux (15 January 2004) to avoid legal action by SCO which claims the operating system unlawfully includes some of its computer code.
SCO is extending its demands for licence payments from Linux users to include small and medium-sized businesses. This follows a demand sent last month to 1,500 of the world's largest companies demanding similar licence payments, and the launch last year of legal action against IBM for allegedly incorporating SCO code into the Linux kernel.
What you should know about the case
- SCO is targeting users of all versions of Linux
- Users of FreeBSD, the other open source Unix-derived OS, Apache, MySQL and other open source products are not affected
- If it wins, SCO will seek payment from users back-dated to June 2003
- SCO needs to prove its copyright has been infringed by demonstrating that Linux contains code derived from the Unix OS
- SCO may not even own the Unix copyright. Novell claims it is the rightful owner. Unless it can prove copyright ownership, SCO's action would be invalid
The SCO Group has filed a motion to amend its Linux complaint against IBM (9 February 2004)
SCO will add two copyright infringement claims to its complaint against IBM. Each claim could increase the amount of damages sought by $1bn, making the total damages in the case $5bn.
The amendment will be the second since SCO filed its initial suit against IBM in March last year, claiming that IBM misappropriated trade secrets related to its Unix licence to benefit its Linux business.
SCO first amended its complaint against IBM in June, increasing the damages amount at the time from $1bn to $3bn.
IBM has since countersued, claiming that SCO distributed its Linux technology without permission and infringed on technology copyrights.
A trial of the case is set for 11 April 2005.
To follow this case visit: www.computerweekly.co.uk
- Cine Bes Filmcilik Ve Yapimcilik & ANOR v United International Pictures & ORS [2003] EWCA 1669 (21 November 2003).
Appeal by the defendant Turkish cable television company ("Cine") and its associated company ("Avrupa") from the judgment of Julian Flaux QC, giving summary judgment for damages to be assessed for the claimant ("UIP") on its claim for breach of contract. UIP was a joint venture company established by film studios, which in 2000 entered into a licence agreement with Cine for Cine to show the film studios' films on its TV channel. The licence agreement contained an option for the studios to require Cine to take a further five year licence on the expiration date in March 2003 and to hold an amount of $4,836,155 (advertising amount), to be used by UIP and the studios to advertise their products. After devaluation of the Turkish lira in 2001 Cine subsequently defaulted on the payment of licence fees and failed to renew the US dollar letter of credit which it was required to maintain under the licence. UIP accepted Cine's defaults as repudiatory breaches and terminated the agreement. UIP and the studios issued proceedings claiming the licence fees due on termination under the agreement and damages in respect of licence fees which would have fallen due during the option to renew period. The defendants argued that the licence had been frustrated and the payments due on termination were unenforceable as penalties. The trial judge held that the defendants had no real prospect of successfully defending the claims. the defendants appealed in relation to the penalty clause and options issues.
Appeal allowed in part. The judge was wrong to consider the different sums due under termination clause in isolation since the actual loss which the claimants would suffer on termination could not be compartmentalised. The different payments were components of the clause as a whole the validity of which depended on whether it provided for a genuine pre-estimate of the loss.
As a matter of construction of the agreement the options to renew promised to the studios never became available for execution in the circumstances. The studios could claim damages for loss of those options. The judge was right to decide that they would have exercised the options but for the defendant's breach and were entitled to summary judgment for loss of the options.
See: www.courtservice.gov.uk/judgmentsfiles/j2089/cine-bes.htm