Intellectual Property Final Exam, Semester 2, 2004

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INTELLECTUAL PROPERTY FINAL EXAM, SEMESTER 2, 2004.

Overall mark: 80 (HD).

Marker’s comments indicated in square brackets and italics.

QUESTION 2 (mark 17.5) (a)

Sarah (S) is advised that there are two possible ways she can stop the bike being sold. The first is confidential information (CI) doctrine, and a second (less likely) option is copyright infringement in the photos (© ).

√ © infringement

S is advised that she will have © protection in the photographs of her bike/invention that have been taken. Photographs fall within the definition of artistic work: section 10, Copyright Act (CA). (other elements material form, expression, originality- nothing on the facts to warrant discussion). The facts suggest it is an original photo.√

She does not need to register © protection in Australia [you cant register © ] and therefore connecting factors established. Has R infringed © in her photos by reproducing the model the model of the bike from the photo?

It is an infringement to do any of the exclusive rights of the © owner: section 31. √

It is an infringement of a 2D artistic work to reproduce it in 3D: section 21(3). However photos are only infringed by the actual copying of the photo itself: Baumann v Fausell. But the reproduction of the bike from the photo into 3D form [mention section 21(3) here] may constitute infringement of S can show: 1. similarity or substantial part of original work is taken; 2. causal connection; 3. objective similarity.

On the facts, the bike involves exactly the same metal set up but simply uses a different type of metal. It is submitted this would constitute a substantial part of S’s work. Whilst the onus is on Sarah to prove R has, on the balance of probabilities, copied her work: Corelli v Gray, the degree of similarity given its identical structure, would suggest it is entirely inexplicable as a result of mere coincidence: Universal Studies v Zeccola.

Therefore there is infringement of © in the photos by reproducing them in material form.

Defences? Fair dealing is not available as R is doing it for commercial business and profit: De Garis.

Therefore S could get an injunction on that basis and stop him selling the bikes. She can also get remedy of taking possession of infringing bikes. [get an injunction against a third party?] √

Confidential information

Alternatively, and a stronger case (given the issue regarding photos), S could argue that R had breached a duty of confidence owed to S re the use of magnets.

There are two issues here: it is doubtful the mere comment to him re the use of magnets would be confidential √ but if it can be shown he stole the pictures it is likely a duty of confidence has been breached.

The action of breach of confidence has 3 elements: Coco.

1. the information must have necessary quality of confidence- must be relatively secret; 2. information disclosed in a situation importing obligation of confidence- the reasonable person would have known it was confidential: Moorgate; Coco; 3. unauthorized use lead to detriment.

1. On the facts, the info is of a technical nature which has taken S some time to perfect/create. Given the skill and effort expended, it is likely to be confidential in nature. The fact she had only mentioned it briefly to R would not destroy relative secrecy: Franchi v Franchi.

2. The fact R has (allegedly) stolen the information means that an obligation of confidence arises: Franklin v Giddens. The fact she had also mentioned it to him also.

√ [importing an obligation of confidence?]

Using the information to create a bike would certainly be beyond authorized use (there was NO limited purpose: Smith Kline). It is to S’s detriment as she is hoping to exploit it herself.

Therefore breach of confidence proven and S would be entitled to a injunction or damages. Again an injunction is what she will need to prevent him from selling the bikes.

[Bike shop may be third party]

Therefore S will be able to prevent the sale of the bike.

[Good discussion]

S is advised that she should apply for a patent over the magnet technique and product on the bikes. √

[is she entitled under s 15]?

A patent can be obtained for any device or method (like her magnet device and its usage) which meets certain criteria under the Patents Act. To be patentable it must be a: (section 18(1))

- manner of manufacture

- novel;

- involve an inventive step (comparable to prior art base)

- useful; and - not previously used in secret: section 15(1)

√√√

The magnets would be a manner of manufacture. [Explain?]

Novel/inventiveness

However, there is an issue here as to novelty and inventiveness. There are a number of issues which may mean S’s invention is anticipated:

R creating and selling the bike around Canberra

This will not affect the novelty of S’s invention as it was the result of unauthorized use of information which was stolen and in breach of confidence: section 24 [(1)(b)?] See question (a) above.

This is provided she applies for a patent within 12 months of him releasing the bikes onto the market (becoming publicly available and party of the prior art base).

S’s testing outside of Canberra

Someone may have seen S test the bike and such use may form part of the art base.

However, reasonable tests are precluded information from the prior art base: section 24, reg 2.2. √ The fact she didn’t test the bike on well known bike paths where there are lots of people around would suggest it was a reasonable trial: In re Newall and Elliot Longworth.

√√

Therefore, these incidences are excluded from the prior art base. On the facts it suggests noone else is using this invention on bikes- therefore it is likely to be novel and involve an inventive step. More evidence would be required.

[Need more argument here re inventive /innovative step]

The patent is clearly useful (need to ensure works from specification though) and hasn’t been used in secret. √ [section 96?]

Therefore she will get patent protection provided the application is made within 12 months of R making the bikes publicly available.√√

[OK. Most issues dealt with]

QUESTION 3 (mark 18) Advice to Lawrence (L) re the ‘Best of Blogs’ (BoB) weblog as to IP rights which prevent use of his posts by the BoB website. L is advised that © is the IP protection which is likely to achieve the protection he seeks. © protection in L’s weblog

If © in weblog, L has exclusive rights to reproduce the material: section31.

L is advised that © protection in Australia does not require registration. He is an Australian citizen and the website is published in Australia and therefore the connecting factors are established.

L must show that the work: - fits within the categories of Part III works or other subject matter (Part IV). - expression; - material form; and - original.

The Blog website- L’s website

L’s website is a compilation of photos, links and comments which he compiles from other sources and allows contributions. The definition of literary work in section 10 expressly includes compilations, and therefore it is a literary work. √√

The fact it is a webpage/site – it is a form of expression and in material form- as although it is digitally/electronically stored – it still fits the definition of material form (section 10(1)) and can be reproduced: Tate v Thomas. There is an issue as to originality since L simply compiles other people’s work.

Works must be original in that it originates with the author, as the result of the author’s skill and effort and not copied from elsewhere: section 32(1).

Lawrence’s weblog – he cuts and pastes information from elsewhere, other people contribute comments and send him information to post therefore questionable whether this is original.

However, compiling non-original material can lead to originality in the compilation if sufficient expenditure, skill, labour and expertise used to compile the information – giving material some quality it did not have: MacMillan and Co v Cooper; Ladbroke v William Hill.

√√ Therefore given the fact L spends ‘considerable time and effort” each day in selecting the articles it is submitted there is originality in the selection and combination of information, pictures and links he places on the site. √√

Therefore L has © protection in his website/log as a compilation literary work.

Has BoB infringed L’s © protected work? It is L’s exclusive right to reproduce his work: s 31(a). BoB will have directly infringed L’s (c) in the weblog if 3 criteria are met:

1. Similarity or substantial part of the work; 2. causal connection; 3. objective similarity.

1. It is an infringement to copy entirely, or take a substantial part: section 14(1). Depends on the quality not the quantity of what has been taken: Ladbroke; and the nature of the work: Hawkes and Son.

Here, BoB has same subject areas (legal theory and internet) with MOST but not all L’s posts, and not original websites L has used or comments for readers of L’s site. They have also included other weblog site links not included in L’s site.

Whilst they have not directly copied, it is submitted they have taken a substantial part, as essentially it’s the combination and selection of links which form the substantial party of L’s site- not comments etc and links to websites themselves- therefore constitutes a substantial part. [Could explain this further] NB: the fact BoB may obtain © protection in their own compilation in their weblog will not prevent them from still having infringed L’s © by taking a substantial party: Ladbroke v William Hill.

√√

2. It is clear that they have taken them directly or they have noted on the site therefore causal connection and objective similarity could be established as very similar in many respects: Universal Studios v Zeccola.

Therefore BoB is likely to have infringed L’s © in his weblog.

Defences? BoB may claim fair dealing in form of criticism or review (section 41) which would allow what is otherwise an infringement of © where dealing is fair and permits royalty free use: section 41.

They would argue they are simply reviewing other sites and provided attribution to L and thus fitted within the fair dealing category of criticism and review: section 41.

However, simply locating where L’s site is not review, there must also be some assessment as to its quality etc. √√. Furthermore, this ‘defence’ of fair dealing is NOT available to those using the material for commercial gain or profit. [is this conclusive?]: De Garis. BoB is using the material on website along with posting advertisements therefore is in the course of commercial gain and making a profit.

Therefore fair dealing is not available as a defence here.

Remedies L is advised he is going to be allowed remedies of injunction to prevent the posting of his links and materials, and possible damages for loss of customers. Injunction probably the best because he can then at last negotiate a royalty agreement license with BoB.

L is advised further however, that he himself, although having © in the compilation may be infringing © if he doesn’t have permission of those sites, photographs etc whose photos and links he is using in the compilation on his site. √√√ He may be subject to similar © infringement claims as BoB if he doesn’t negotiate with those whose material he has been using.

[Fair dealing for L?? Passing off?]

QUESTION 4 (mark 19.5) ADVICE TO MARTY (M) RE BRAINEASE

M has both a standard patent on the use of braxinol for relief of headaches (expired) and an innovative patent over the use of it with aspirin (which has a further 7 years to run- 8 years total protection). M also has TM over the name “Brainease” and pharmaceutical products. May also have © in literary work of patent application. √

M has potential claims against ‘Brian Relief Company’ (BRCo) for: 1. infringement of patent; 2. infringement of TM, tort of passing off or section 52 TPA action; and 3. Copyright infringement. √√

Each will be considered in turn.

1. Patent

M holds patent over use of B with aspirin for relief of headaches which is still valid for 8 years. His patent over use of B for relief of headaches has expired. Therefore he does not have monopoly over use of B re headaches. However, he still has limited monopoly over use of it with aspirin for relief of headaches. √ [Yes this is what the patent covers] Has BRCo infringed his patent?

It is a direct infringement to exercise M’s exclusive rights to exploit the use of B with aspirin. (section 13, Schedule 1). Liability is strict.

Therefore M cannot prevent BRCo selling BR for treatment of headaches but can prevent the use of it with aspirin.

Therefore use of BR as advised on the packet is within the scope of M’s innovation patent. The fact the BRCo product is sold with instructions to use with aspirin the substantial idea of M’s patent has been taken and embodied in the infringing product (Populin; Catnic). It is identical so no need to consider the effect of variations: Catnic.

[use section 117 especially subsections (2)(c) ]

The selling and use of the product with such process is the exclusive right of M in section 13(1), Schedule 1. (assuming same for innovation patent as for standard).

Therefore, M is likely to get an injunction to prevent the sale of products advertising that particular use with aspirin. √√ (his patent over use of product has expired): s 122(1).

Therefore patent law will not prevent sale of tablets simply that particular use. BRCo would have to remove these instructions. [OK good careful answer].

2. TM, passing off, section 52

M has a registered TM ie ‘Brainease’ relating to pharmaceutical products. He may bring an action for TM infringement, along with passing off and section 52 TPA. √√

TM infringement

Under section 120 there will be infringement of TM where a person:

1. uses a TM which is substantially identical or deceptively similar to the registered TM;

2. in relation to the same goods or services: s 120(1).

Here use is in respect of exactly the same product, therefore section 120(1) applies. √

1. Use as a TM?

BRCo may argue it is not use as a TM- merely use of a descriptive term as the product provides “brain relief” as it relieves headaches. Therefore, may argue descriptive rather than badge of origin. √√ More information would be needed as to whether registered TM, the packaging (whether other description on the packet etc). Possible use as TM here.

2. Substantially identical or deceptively similar?

In considering this we look to the definitions in section 44 [for registered TM]. Unlikely to be considered substantially identical on side by side comparison (Brain RELIEF rather than Brain EASE). May be considered deceptively similar (section 10- if so nearly resembles as likely to deceive or cause confusion). This depends on recollection of the hypothetical consumer in purchasing situation: Australian Woollen Mills. Here the names are very similar and the products are likely to be sold on the same shelf- so court may find them to be deceptively similar. More evidence is needed here.√

Possible TM infringement. However, M has stronger claim in passing off and TPA, given he has excellent reputation in the industry.

Passing off/TPA

Passing off allows protection of goodwill and reputation. TPA requires corporations as Defendant and is available regarding broader forms of conduct but essentially also involves misrepresentations. TPA offers broader range of more flexible remedies. Both are considered below.

Passing off involves: (Con Agra)

1. showing reputation/goodwill: M obviously already shown to have strong reputation in the marketplace.

2. Misrepresentations by D (BRCo) that is likely to mislead public to believe the goods and services offered by it (Brain Relief) are those of M, or have similar quality.

More evidence is required here to conclude that consumers were actually mislead. Similarities in name and product are such that there would be a presumption of passing off: Australian Woollen Mills.

3. Damage: it’s a competitive product and affected sales etc; therefore likely to affect M’s sales representation.

Therefore M could get an injunction to prevent use of the name/packaging etc. Questionable whether he could prevent selling tablets altogether – will require use of different name and packaging only. √√

Need more information as to whether consumers actually mislead by the name, packaging, marketing etc. More facts required. M may succeed in TM, passing off and TPA actions, however more evidence is required as to the effect on consumers to conclusively advise on likely outcome in Court. TM infringement difficult to prove.

M will have © protection [Maybe see section 226 of the Patents Act] in patent application a literary work: section 10. BRCo by copying instructions, provided substantial part, will be infringing © in application and thus will be infringing © in application and thus could get an injunction and damages for use of his literary work and prevent BRCo from using the instructions on the packet.

(b) Given its an infringement of his innovation patent to use the product blending it with aspirin, M can get an injunction to prevent the production of the product in Australia.

Making the product /process is an exclusive right of patentee: section 13(1), Schedule 1; therefore infringing his patent by making the product mixed with aspirin in Australia. Presumably an injunction preventing them from making the product will prevent exportation.

[Is this what the patent covers or just its use of headache relief?]

However M is advised that if he makes a Paris Convention application within 12 months or original Australian application the foreign filing date is taken to be the filing date (priority date) of his Australian patent: ss 94-96; regs 3.12.

√√

This would ensure protection overseas and prevent his rival using the product/processes overseas.

[Good analysis]