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Licensing in the 21st Century - A Success Story: Hunter-Fleming from "Patent to Patient"!
It is well known that the pharmaceutical industry is suffering from the lack of new drugs to replace medicines which for many years have given the industrial giants strong cash flows and enormous profits, but are now out of patent or coming to the end of their patent protection.
Not surprisingly, the financial press have been telling the investment community for some years that the industry needs to establish pipelines of new compounds. Moreover, development processes need to be accelerated. The newly appointed Head of Research at Novatis, Prof. Fishman, in an interview with the Financial Times (17.09.02 ) called for a complete overhaul of the way in which drug discovery is handled. In the last 15 years R & D expenditure has been about $30 billion and yet each year a declining number of new products is brought to the market. His solution is to work more closely with universities and hospitals. In his words, "this is to be a new approach " which his competitors will be watching closely.
Dr Jim Murray, joint founder of Shire Pharmaceuticals was ever mindful of the problem and also felt that universities would be a good source for new inventions. Following the highly successful flotation of Shire, (now capitalised circa £3 billion) and at the end of his required tie-in, Dr Murray elected to pursue a new strategy:
- Creating a team of industry experts
- In-licensing intellectual property from universities
- Cross-fertilizing ideas
- Directing further research and development.
The idea was to harness academic curiosity and encourage scientists to work in harmony with common goals. A key feature of this strategy was to overlap research and development, which is a departure from industrial and academic norms.
A founding group was quickly built: Dr Murray teamed up with Prof. Ernst Wulfert, who headed a team of 500 research scientists at UCB laboratories and Dr John Fox who managed drug trials at Shire. They incorporated Hunter-Fleming (H-F) in February, 1999.
The first licence from Japan was swiftly completed in February 1999 followed in September by a second for the treatment of head injury and stroke from Southampton University.
As with most start ups, cash came originally from the founder's pockets and H-F came up with the novel idea of exchanging these first licences for shares. This was attractive to the universities in that they became stakeholders in a basket of projects, passing management responsibility to a team of industry experts and receiving cash to continue research. Hunter-Fleming went further, buying and donating equipment to departments hungry for investment.
Once the company had acquired assets in the form of licences it was able to raise funds from private investors,
friends and family. The team used their past track record, demonstrated personal financial commitment and raised £4.2 million.
The board was strengthened by the appointment of an independent chairman and a financial director with extensive international experience. In order to provide the Company with high quality expertise in areas such as regulatory affairs, specialists have been contracted on a part time basis. This helps H-F to maintain its economic efficiency whilst at the same time mirroring the high standards of major pharmaceutical groups.
Momentum was building and further licence agreements were being signed with CNAM in France and Loyola University in Chicago. Cash was available and H-F was directing research and development programmes in these and other universities. The scientists enjoyed seeing their own work exposed to other international groups' expertise and relished the consequent development of new ideas. Couple their excitement with highly experienced industrial scientists who have been in the commercial world and you can begin to see how significant breakthroughs can evolve.
This innovative model of drug discovery encourages academic curiosity to blossom and has resulted in H-F patenting a series of novel compounds in their own right.
In its short history H-F has also acquired a spin out company from Bristol University, which held valuable licences. The founders were encouraged to participate with H-F, Prof. Tim Hirst becoming a director. This acquisition brought expertise in immunology which, as well as being a definitive new platform technology for H-F, quickly stimulated the scientists into considering how immunology could be applied to the other H-F platform of central nervous system disorders.
What are the successes so far?
- A small but highly innovative company has progressed no less than 5 compounds, which will enter clinical trials within the next 6 -9 months
- The Company has recently raised a further £8.5 million, (£3.5 million of which is tied to milestones) from a syndicate led by MTI Partners
Licensing is the all-important role for the company. Non-core areas of discovery are to be out-licensed, as will the new key compounds - once they have passed to Phase IIa studies.
Hunter-Fleming plan to continue their programme of working closely with world wide centres of academic excellence, nurturing innovation and maintaining a pipeline of discoveries.
The key driver to the future success of H-F is licensing, in-licence ideas, add "know how" and out -licence to an industry desperate for new lead compounds to develop.
Further information is available on the website, www.Hunter-Fleming.com
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President's Diary
I hope that those members who have been attending the London evening meetings have been finding them both informative and useful as a networking forum? We have been able to offer you a range of skilled speakers and, as a result, we are experiencing excellent attendance levels.
The speaker for the October meeting was Michael Leathers, Head of IP at British American Tobacco. Michael delivered a fascinating talk describing how BAT are "turning the tide on the product counterfeiters" It was shocking to hear that counterfeiting represents, by some estimates, 7% of world trade.
On October 30th we held our first LES International Licensing tuition course, "Fundamentals of Intellectual Asset Management". The course was very successful and well attended. We hope to repeat the course in the next 12 months and to provide intermediate and advanced courses at a later stage.
Looking beyond Christmas, we will hold the LES B&I Annual Lunch at the Savoy hotel on February 13th 2003. There will be a morning meeting offering a mix of business and legal topics followed by the lunch. We are delighted to announce that our Guest Speaker will be Adam Hart Davies, popular science and history presenter for the BBC. Adam has worked presenting Tomorrow's World and also What The Tudors and Stuarts Did For Us. Adam will be giving us a taste of "Local Hero's - History of Invention".
For the Annual Lunch at the Savoy, in February 2004 - I can't believe we are booked this far ahead - our Guest Speaker will be Baroness Susan Greenfield CBE, Director of the Royal Institution of Great Britain and a Founding Director of Synaptica Ltd in Oxford. We will give you further details a little closer to the time.
We are now planning our conference topics for the 2003 Conference and AGM to be held at
Chelsea Football Club in London on June 26-27. If there are topics that you would like to be considered at this meeting, or if you would like to arrange a workshop, please let me know.
LES Council wishes all our members a very happy Christmas and prosperous and peaceful New Year. Just to keep you occupied over the port and pud, we have included a Christmas quiz for you.
Christi Mitchell,
President LES B&I
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New European Registered Design
The European Union (EU) Regulation No. 6/2002 (in force from March 6, 2002) introduced the European Registered Design Right and an EU Unregistered Design Right. The Registered Design system will offer a single unitary right covering all EU member countries and facilitate a simple method by which users can obtain design registrations that may cover more than one design.
What are the interesting features?
- Ease of obtaining registration - no search/examination problems to deal with
- Slots neatly beside trademark protection - 3D (and other) - designs now easily protected whereas previously protection had to be obtained on a country by country application, or by trying to obtain trademark protection (see note on trademark protection below)
- Potential for protection of multiple (up to 100 in total) designs within a single design registration
- A valid design registration can be obtained in certain circumstances even if the design has been disclosed, as the test for novelty of the design is not the "absolute" test
- A grace period of 12 months exists for filing of a valid application for registration after disclosure of the design
- The total term of protection is 25 years
- The design is seen as something apart from the article to which it is applied, so potentially the same design applied to a different article infringes the registration
When can I file?
You can file applications from January 1, 2003 when the registered design system is expected to be operational. However, the earliest filing date accorded will be April 1, 2003, so an applicant can:
- File an application on or after January 1, 2003 with a claim to priority from any priority application filed on or after October 1, 2002
- Take advantage of the 12 month grace period for any design made available to the public on or after April 1, 2002
- File a valid application on or after January 1, 2003 if the design has not been "made available to the public", even if the design has been disclosed before April 1, 2002
What are the substantive requirements for valid registration?
The design must be "new" and have "individual character". For a design to be considered new, no identical design can have been made available to the public anywhere before the date of filing or the priority date. A design shall be considered to have individual character if the overall impression produced on an informed user differs from the overall impression produced in such a user by any design which has been made available to the public before the date of application for registration or the priority date.
It will be further noted that absolute novelty does not strictly apply. A design shall be deemed to have been made available to the public if it has been published or exhibited, used in trade or otherwise disclosed, except where these events could not reasonably have become known in the normal course of business to the circles specialised in the sector concerned, operating within the Community, before the filing date or priority date.
Why trademarks in a design system?
In addition to being beneficial to the protection of articles which traditionally have been protected as Industrial Designs under the various national laws, the Design Regulation has important benefits in the protection of marks such as trade dress/get-up/packaging, detergent tablets, shapes of objects including bottles, and other forms of two/three-dimensional marks. In the past, these have either been refused protection or have been difficult to register as trademarks under the Community Trademark Regulation or under the various national Trademark laws, primarily because of the difficulty in proving that the marks had distinctive character.
Provided that the mark (article) being registered as a Community Design conforms with the essential requirements of the Regulation, that is, it is (1) new (grace period of one year) and has 2) individual character, it should be registerable as a Community Design which, subject to payment of each 5 year renewal fee, will have effect throughout the European Union for 25 years. There is no requirement to prove distinctiveness and it will be possible to include a number of designs within the registration. Accordingly, it is strongly recommended that trademark owners should look at the benefits conferred by the Design Regulation as part of their overall protection program within Europe.
Conclusion
The Design Registration system offers tremendous opportunity to obtain EU wide protection for multiple designs in a single registration whilst offering great value for users of the system. The system dovetails very well with the Community Trademark, particularly for marks with 3D character. We expect this system to be successful based on the track record of the Community Trademark system and the attractive features it offers.
Cathal Lane and Barry Moore.
The authors are European Patent Attorneys with the firm of Tomkins in Dublin Ireland. (This information is not intended as a statement of the law and readers with particular queries should obtain professional advice).
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Message From Neil Muttock, New Chair of the Education Committee
"My plans for the LES B&I Education Committee are to continue the good work of Stephen and the present committee.
I will particularly focus on the development and delivery of the LES US licensing course. This should enable us to establish a comprehensive course material, which is owned and controlled by LES itself and which we can use as a basis for appropriate delivery formats. I believe this should become an important part of the work of LES as a whole and enable it to contribute to establishing professional standards in the licensing field and also to strengthen the identity of LES.
Stephen and Chris Goodman are working hard on adapting the first IPR module to EU law. When the course is developed, experienced speakers will be required to deliver the various modules. Anyone who interested in delivering any of the modules, please get in touch neil@hgps.co.uk and also try to attend the first course module being held on 30th October in London.
We will also be working on organising and delivering licensing conferences, marketed by Hawksmere. Interested experienced speakers please contact myself or Jennifer Pierce jennifer@cr-law.co.uk.
We are also working on joint meetings with allied organisations such as AURAL, CIPA, R&D Society, PLG, AVRIL, FICPI, ITMA and others. More on this later."
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Celebrating 150 Years of the Patent Office
A Revolution in Invention - The Making of the Patent Office
Patents, like inventions, have been around a long time and stretch back into the mists of medieval history. At that time patents were a grant of the King, a way of raising some extra cash, and the system fell into disrepute. Queen Elizabeth I had already been forced to promise reforms in 1601. But it was 1624 when parliament prevailed on King James I and the Statute of Monopolies was passed. From now on patents could only be granted for "any manner of new manufacture within the realm" and were limited to a monopoly of 14 years (the time it took to train two generations of apprentices).
A big step forward, but not big enough; inventors still had to visit seven different offices and obtain the King's signature twice to get a patent - the frustrations are summed up in Charles Dickens' spoof article "A Poor Man's Tale of a Patent". By mid 19th century it cost around £100 to obtain a patent covering England and Wales, or Scotland or Ireland - each country within the UK had its own archaic patent system.
Like many European nations, Britain had an age of revolution in the 19th century. No, the monarch wasn't beheaded, but the mid-19th century saw many old institutions reformed including the Civil Service. Gone were the days of purchasing lucrative posts. Entrance would be by competitive examination only.
And in this rush of reforming zeal, the Patents Law Amendment Act 1852 was passed ushering in the world's first "modern" patent law; a description of the invention had to be filed with the patent application, and for the first time ever patents were published; the cost of the whole process was reduced to £25! The number of patent applications soared, from a few hundred to over 6,000 per year by the 1880s. The law was designed to benefit society by increasing the rate of innovation - offer a 14 year monopoly in exchange for publishing details of the invention - this exchange allowed others to base new, better inventions on what had gone before. That basic principle has not changed to this day and has been adopted by nearly every nation in the world.
The same law brought the Patent Office into being on 1st October 1852 (hurrah, we're 150 years young!); the infant Office had responsibility for:
- Patents
- The Patent Museum (some inventors were invited to contribute models of their inventions) which was at South Kensington and was passed over to the Science Museum in 1884
- The Patent Library, which rapidly became one of the UK's premier technical and scientific collections. The library remained part of the Patent Office until the 1960s when it passed to the British Library as the Science Reference Library
An important figure in the early history (and pre-history) of the Patent Office was Bennet Woodcroft, first as a proponent of the need for reforms, later as Clerk to the Commissioner of Patents. He was responsible for organizing the publication of patents and the various indexes made available. These were
sent out free (as required by the Patent Law Amendment Act) to many libraries, museums, mechanics institutes and so on scattered round the UK and other countries of the British Empire.
The Patent Office long remained at the site of its first home, 25 Southampton Buildings, an office it originally shared with the Secretaries of Bankrupts and Lunatics! But the office accommodation soon proved inadequate and over the next half century most of the site bounded by Chancery Lane, Quality Court, Furnival Street and Staple Inn/Southampton Buildings became absorbed by the Patent Office which retained a link with the building until late in the 1990s. Parts of the building, including the now empty library, have been listed.
Not every employee of the Patent Office in its long history has had a very distinguished career. The first curator of the Patent Museum, George Nasmyth (brother of the famous Scottish engineer, James Nasmyth), was appointed in 1856 and was dismissed less than three years later for the defalcation (misappropriation) of nearly £750 intended for running the Patent Museum.
At the outset there was no examination of patents and no search to check that the inventions were new. The Office's principle tasks in the early days were to publish patents (including those granted from 1617 onwards) and to index and abridge them, so they could be searched for effectively. Skilfully engrossed Letters Patent continued to issue when a patent was granted - these bore the Great Seal of England until 1878 (by then over 5,000 patent applications were filed each year, over 3,500 granted).
1875/6 saw new responsibilities and the Patent Office took on registered designs which protect the look of an article (these had previously been with the Board of Trade) and also for the newly created registered trademarks which protect the brand identity of articles (and now services). Trademark number 1, the Bass Charrington red triangle, is still in force after 125 years.
Although The Patent Office has never employed an Einstein, the staff of the Trademark Registry were soon to include AE Housman, now chiefly remembered as the poet of "A Shropshire Lad", who left the Patent Office in 1892 to become professor of Latin and Greek at University College, London.
1884 saw yet more changes - the first patent examiners ("special indexing and abridging clerks") were recruited, and for the first time patents had to have a claim to define the scope of monopoly awarded by a granted patent. Once again, fees were greatly reduced, with the pre-grant fees now amounting to £5 and the number of patent applications was over 30,000 per year by 1900.
Still there was no search for novelty - that had to wait until the Patents Act 1902 which introduced a search of British patents published in the previous 50 years. And the search brought in an innovation of its own - published patent specifications were mounted on A3 cards with coloured clips along the top to allow more rapid searching for particular features. How different from today's search which embraces publications worldwide and has to consider not only whether an invention is new, but also whether it is obvious compared with what is already known; searching today is largely carried out using online computer techniques.
The Patent Office passed through the two World Wars with many staff taking an active part on the front line and others working on the home-front on duties such as fire-watching. The First World War had seen the deaths of a number of Patent Office staff - when we finally severed our link with 25 Southampton Buildings we brought with us the tablet commemorating them. Fire-watching was not just a pastime in World War II, in August 1944 25 Southampton Buildings was hit by a V1 flying bomb ("doodlebug") and badly damaged, yet not a single document of importance was destroyed.
That patents can contain valuable information is not always appreciated. The bombs dropped on the UK in the early part of the Blitz caused many casualties amongst bomb disposal officers, until they figured out how the fuse should be made safe. What a pity no-one thought to look at published patents, the patent for this particular bomb fuse invented by Herbert Rühlemann had been published as patent GB376142 in 1932. By the time the patent was uncovered, a different fuse (not patented) was being used.
The last 25 years has seen many important changes in intellectual property law in the UK with the UK acceding to the European Patent Convention and Patent Convention Treaty in 1978 so that is now possible to obtain patent protection in the UK without making an application for a British patent, but the Patent Office is a receiving office for both types of patent application. Similar provisions have come into effect for registered trademarks and registered designs in the last few years. Implementation of the Trademarks Act 1994 means that unauthorised use of a registered trademark is now a criminal offence and gives local trading standards officers the duty to take action.
The Patent Office, now an Executive Agency of DTI, moved to its purpose-built premises in Newport, South Wales in 1991 which has proved particularly successful for the implementation of the now ubiquitous IT equipment. Although we said farewell to many valued members of staff in London, the Patent Office has gained from the loyalty and quality of staff recruited in the Newport area.
Over the past 150 years patented inventions have changed almost every aspect of life, from toys such as Frank Hornby's (an accountant) well-known "Meccano ®" (GB587/1901, 1901 -see diagram), through Percy Shaw's cats-eyes (GB457536, 1936) to Frank Whittle's jet engine (GB347206, 1930).
150 YEARS YOUNG - The Patent Office is adding the role of enabler to its original role of a regulator. More and more we see our place as being to enable the creators of today's designs and inventions to bring their innovations to the market place with the protection provided by the UK intellectual property system. So it is particularly appropriate that in April 2002 the Patent Office joined the Innovation Group within DTI. The Patent Office, as ever, remains open for ideas.
Melvyn Rees
The Patent Office
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Licensing Update - Licensing IPR in business
- AST Sportswear Inc v Majid & Anor [2002] EWHC 778. Dispute re sums claimed under distribution agreement.
- term "Europe" not defined,
- assignment agreement reached by exchange of letters and
- no evidence third party charge covered trademark.
- Pharmed Medicare Private Ltd v Univar Ltd 05/11/02. Signing of Pharmed's proforma invoice sufficient in itself to give rise to binding contract. Clear case of ostensible authority and hence unnecessary to consider consequence of acts of employee.
- Thomas Scott v Universal Components Ltd 31/10/02. Ownership of 2 drawings (Copyright Act 1956). Employee owned copyright to first drawing produced at home (s.4(4)). 2nd drawing owned by Employer under employment contract (s37).
- Celltech Chiroscience Ltd v Medimune Inc 28/10/02. Royalties payable on sales of products covered by valid claim of patent. Claimed that Defendant sold product that fell within scope of patent. Claim depended on doctrine of equivalents. Doctrine of equivalents not available to claimant as precluded by file wrapper estoppel.
- Peter Hayes v (1) Phonogram Ltd & others 17/10/02. Division of copyright (10%) in song's rap lyrics. Royalties payable on sales of rap version only. No share in copyright and no royalties payable in the copyright of song as a whole (music and lyrics) or any other versions.
- Garcia & Ors v De Aldama 23/10/02 (EWCH 2087 (Ch)). Terms on which poet Federico Garcia Lorca delivered manuscript to publisher before disappearance in 1936 unknown. Estate stood by with full knowledge and never made claim for over 60 years. Concluded that they never believed that either Garcia himself or they owned it.
- Spectra International PLC v Tiscali UK Ltd and another. Formation-incomplete contract. No oral contract concluded by parties who had negotiated regarding the provision of Internet services by provider to the wholesaler of Internet televisions.
- Mediation precedents - CEDR website contains some useful model documents see http://www.cedr.co.uk/index.php?location+/library/documents/default.htm
- Record Companies and parallel imports - OFT warns record companies may face strong action if they breach competition law.
http://www.oft.gov.uk/News/Press+releases/2002/PN+59- 02+OFT+tells+record+companies+to+stay+in+line.htm
- Small IT company, Lime-IT, wins legal battle against Inland Revenue following a Special Commissioners' judgement that 'end-user' contract between company and an agent was outside the scope of the controversial IR35 legislation.
- Ruling from a German Court (Hamburg Regional Court 3 U 168/00) suggests that if seller sends his terms and conditions to a buyer by email, this is not an adequate substitute for the seller placing those terms in a prominent position on his web site.
Monitored by Dr Hayley French, TAYLOR WESSING
h.french@taylorwessing.com
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News from our Correspondent in China
It's an exciting time to be in China. In contrast to most of the rest of the world, the economy here is booming. It grew by 8% last year and is set to do so for several years to come.
Foreign Investment has been pouring in, following the PRC's accession to the WTO last year, an event many never believed would happen. Beijing is hosting the 2008 Olympics, which has led to a fervent of sporting sponsorship deals, and the ATP tennis championship is in Shanghai next month (and you can be sure I went to see Anna Kournikova when she was playing in town earlier this year). China is bidding hard for the Expo 2010 - Shanghai is peppered with posters of a little Chinese boy stretching his arms up to the sun, captioned 'Turn our wishes to reality'. One of the biggest gas pipelines in the world stretching thousands of miles from the Gobi desert to the cities of the Eastern seaboard is planned to begin shortly.
To get an idea of the scale of China's ambitions you should visit the Shanghai Urban Planning Museum. Despite its dull name, this is really an excuse to show off a vast architectural model of what Shanghai is planned to look like in 20 years time - business parks, state of the art container ports, monorail systems, leisure centres, and zoned housing. The scary thing is that it may well happen. Apparently, the City Authorities recently commissioned a group of famous big-wigs, such as Richard Rogers, to examine Shanghai and tell them what they needed, in order for it to be a truly great city. 'More green spaces' was the reply. Practically the next day, the inhabitants of four or five blocks of old brick low-rise houses near the centre were moved out and their houses demolished to make way for an instant 'green space'. Being a one party state has its advantages in terms of bold decision making!
So, having been here three months what can I usefully say to my friends in LES GB & Ireland about licensing in China? Business-wise, there are great opportunities. Many industries, particularly retail, pharamaceuticals and telecoms, are opening up, post WTO, and others will follow. It is now possible, through a Wholly Owned Foreign Enterprise (WOFE - pronounced 'wooffie') to run a business in China without having to go down the route of joint venturing with a local company. Technology transfer is encouraged by the Government and there are many different tax and other fiscal incentives to bring new technology into China.
But do not expect to make bucks that fast. Despite the glitzy Western-style veneer you see in a place like Shanghai or Guangzhou (Canton) there are still 900 million rural inhabitants who live by small farming and whom the economic changes of the last few years have hardly touched. Even in the urban centres, you have to remember that this is a country that has only been playing the capitalist game for, at most, 15 years. The managers and executives you do business with are unlikely, unless they have spent a significant time outside China, to have a great depth of experience in management. There is still a lot of bureaucracy. There is still a problem getting Chinese people not to defer to, and be fearful of, their boss, which can stifle creativity and spontaneity. It is important to understand that you need to be in China for the long term (my business has been here, providing IP advice for nearly 10 years and I'm sure we still have a huge amount to learn). But it's worth it, because China sees itself as the economic "power house" of the 21st century and though there is still a long way to go, that dream is by no means impossible. In fact it is likely.
In terms of legal developments, there have been so many it is difficult to know what to pick. For reasons of space I will highlight just one, which is of major importance. China is amending and enacting its laws and regulations to bring them in line with WTO rules and to foster its good image as a responsible member of the WTO. One result of this is that China has passed new Implementing Regulations Under The Trademark Law of The People's Republic of China, which came into force on September 15, 2002. Under these regulations it is possible for foreign trademark owners to claim 'well known' status (previously this was only an option for domestic businesses). An applicant may apply for the recognition of its trademark to be well known in China - though note, this does have to be in the context of opposition, cancellation, appeal procedures, or enforcement actions against infringement. The Regulation provides that a trademark owner may lodge opposition or (as appropriate) cancellation proceedings against a third party's mark on the basis its trademark is well-known or famous. If so, it must submit supporting materials for the claim. If the Trademark Office or Trademark Review & Adjudication Board considers, based on the materials provided, that the mark in question is well-known enough, the mark will be conferred with well known status. Registered well-known trademarks are protected over any classes while unregistered well-known trademarks are only protected in similar classes. If the Trademark Office establishes that a mark is well-known and therefore the other mark is infringing, the Administrative Authority for Industry and Commerce (AIC) will order any infringer to stop the infringement, confiscate and destroy all representations of the trademark. If it is difficult to remove the representations of the trademark from the goods, both the representations and the goods shall be confiscated and destroyed. Similar rules apply to claiming well-known status during an action for enforcement.
For more information contact Ben on bgoodger@iprights.com
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News from the Regions
LES North West Region
The North West Group held their Autumn meeting at the Stock Restaurant in central Manchester on 8th October, 2002. The speaker, Christopher Cook, Barrister, Exchange Chambers, 4 Ralli Courts, West Riverside, Manchester, M3 5FT, proved to be a popular choice. The topic - "Parallel Imports - Have we reached the end of the road?" - provided an informative insight into past and recent case law, paving the way for what Christopher Cook believes to be the end of the road for parallel imports. His view that a political decision has been taken to protect IPR owners from parallel imports from outside the EEA engendered a lively debate.
Our next meeting is on 3rd December 2002 at the 39 Steps restaurant in South King Street, Manchester 18.00 for 18.30. Jason Harbrow, who was the Commercial General Manager for Manchester 2002 will give a talk entitled, "Merchandising - A Retrospective of the Commonwealth Games". All welcome.
For futher details please contact: Nicola Amsel (Nicola@amsel.co.uk)
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Dyson v Hoover - A tough licensing question
James Dyson's success story is familiar to most of us. In 1993 he launched his novel and stylish vacuum cleaners, with their patented cyclonic dirt separators. He stormed into the UK market, taking half the upright cleaner sales by 1999.
But in 1999, with much fanfare, Hoover responded by launching its own competitive cyclonic products. Dyson sued. Dyson's patent was found valid and infringed. Hoover was obliged to withdraw infringing cyclonic machines from the market.
In the 'Inquiry as to Damages' phase of the legal action, which followed, one of Dyson's major claims arose from loss of royalties on those infringing machines sold by Hoover, that Dyson would not have been expected to sell. For example, very loyal Hoover customers or people living far from a Dyson distributor might not have bought Dyson machines.
What 'reasonable' royalty would the two parties to the dispute have agreed, at the time when infringement started, assuming they were 'willing licensor' and 'willing licensee'? A tough and daunting question for the licensing experts advising the court; there's not a lot of willingness around in litigious circumstances! But by forcing two assumptions - that there were indeed sales that Dyson might not have fulfilled and that Dyson would have wished to secure the highest achievable royalty on them - and by careful analysis of the available financial and marketing evidence, a convincing analytical framework can be reached.
When the licensing experts retained by each side eventually met to prepare their experts' 'Joint Report' for the court, they found that - independently - they had arrived at similar analytical frameworks, although they had differing interpretations of the evidence and had reached rather different conclusions.
Just days before the experts' analyses and conclusions would have been tested in open court, Dyson and Hoover settled for £4 million, plus costs and interest (3rd October 2002). The work of the licensing experts helped the parties reach their settlement. Their opinions, however, will not now become part of the public record!
John D Emanuel © November 2002
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STOP PRESS 12 Nov 2002 - Arsenal Football Club v Matthew Reed - UPDATE
The European Court of Justice disagreed with the earlier High Court of Justice decision in favour of Matthew Reed stating that the "essential function of a trademark is to guarantee to consumers the real origin of goods or services by enabling them to distinguish them, without any possibility of confusion, from those from a different origin." It also stated that "this guarantee of origin can be ensured only if the trademark is protected against competitors wishing to take unfair advantage of its status and reputation by selling goods which are not originals". It felt that with the products of Matthew Reed such a risk of confusion could not be ruled out as once the goods had left his stall there was nothing to say that the goods were not the official products.
For further information see: http://europa.eu.int/cj/en/cp/aff/cp0291en.htm
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New Members
Council has been please to welcome the following new members to the Society:
- Mr Thomas A Bjorn, Head of Legal Affairs, CAMR;
- Dr James A Blakemore, Licensing Manager, CellFactors plc;
- Ms Fiona M Crawford, Partner, Elkington and Fife;
- Mrs Joanna Crowe, Mining Manager & IPR Exploitation, BTexact Technologies;
- Mr P Daley, De La Rue plc;
- Ms Anna Feros, Solicitor, Shepherd & Wedderburn;
- Mr Christopher Gibson, Partner, Steptoe & Johnson;
- Dr Vishal Gulati, Investment Associate, Atlas Venture;
- Miss Donna Hackett, Commercial & Legal Consultant, ProPharma Partners Ltd;
- Mr Adrian H C Horne, Business Development, Multigig Ltd;
- Mrs Julie Horne, Director, Oakland Innovation;
- Mr Mark Howard, Managing Director, Sensopad Technologies Ltd;
- Mr Dudley Kneller, Associate, Steptoe & Johnson;
- Mr Adam D Lindemann, Managing Director, Source of Inspiration Ltd;
- Dr Amanda Lindsay, Development Manager, London Metropolitan University;
- Ms Anna Sophia McKay, Partner, Roiterzucker;
- Mr Douglas R McPhee, Partner, KMPG Corporate Financial;
- Mr Khawar Mann, Weston Medical; Dr Stephen Manton, Head of IP & Patents, British Nuclear Fuels plc;
- Mr Julian Charles Nolan, VP IPR, Licensing, British Telecom;
- Dr Timothy Norris, IP Manager, Sentec Ltd.;
- Mr Nigel William Page, Partner, White Page;
- Mrs Sumati C Parikh, Associate, Wragge & Co.;
- Ms Binita Patel, Technology Exploitation Manager, Trustech.;
- Dr Michael Pescow, Senior manager, RSM Robson Rhodes,;
- Mr Andrew Shindler, Partner, SJ Berwin,;
- Mr Graham Thomas, Operations Director, JRA Technology;
- Mr Kevan P Tidy, Senior Solicitor, Lemon and Co.;
- Mr Paul Vega, Associate, IPValue;
- Dr Paula Walsh, Technical Licensing Principal, GlaxoSmithKline.
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