Intellectual Property Law in the UK - Case Study Example

Introduction Halkyard’s Musical Instruments can and could have applied for protection and exclusive use of their musical instruments and their special characteristics. Protection by way of registration is provided for under trademark and patent legislative provisions. Trademark protection is available in respect of distinguishing features in a business product or service that is capable of setting it apart from all others. Patent protection is available in respect of innovative products and ideas. Had Halkyard obtained patent and trademark protection they would have been able to control and restrict the use of their product names, ideas and their identifying symbols and styles. In general the law provides for a balancing of protection for innovative products and designs and serving the public’s interests in controlling and restricting protection of the various types of patentable property. The concept of intellectual property rights has always been regulated to ensure that protection does not impede the rights of others.1 Dr. Llewelyn explains that this is why: “…there has been considerable strictness exerted in defining the requirements which have to be met before a right will be granted.”2 The discussion that follows examines those requirements and explains why and how Halkyard’s Musical Instruments meet those requirements and can and could have obtained protection thereby preventing the marketing of guitars, symbols and names that appear to be mere imitations of the products produced and marketed by Halkyard’s. Trademarks As previously stated a trademark is a distinguishing feature of any business entity that sets it apart from another business entity.3 Distinguishing features usually take the form of names, logos, slogans, designs, colours and numbers. These features can be used either individually or by virtue of a combination of any or all of these characters.4 Halkyard used a bright pink emblem in the shape of the Ace of Spades. Moreover their deeply stained wooden guitars became known as pink ‘n’blacks. The distinctive acoustic guitars with the long neck is also a distinguishing feature as well as the pink guitar picks. These characteristics are distinguishing features and collectively operate to identify the Halkyard unique guitars and accessories. Over the years a number of competitors with similar products have marketed products vastly similar to Halkyard’s but this does not preclude Halkyard taking advantage of the common law right to use marketing and packaging designs which distinguish their products from their competitors. Moreover Halkyard Musical have a common law right to prevent passing off of their business identification traits. Pink Pianos have marketed pink electric guitars with an emblem of the Ace of Clubs that bears a striking similarity to Halkyard’s emblem. Pink Piano’s conduct amounts to the common law tort of passing off. Halkyard can commence legal proceedings to prevent the continued passing off. In Reckitt & Colman Ltd v Borden Inc the House of Lords confirmed that a three tier test of good will, reputation, misrepresentation and damages were necessary elements of the plaintiffs’ claim for passing off. Lord Oliver said of the plaintiff: “First, he must establish a goodwill or reputation attached to the goods or services…Secondly, he must demonstrate a misrepresentation by the defendant to the public (whether intentional) leading or likely to lead the public to believe that the goods or services offered by him are goods or services or services of the plaintiff….Thirdly, he must demonstrate that he suffers loss of damage as a consequence of the erroneous belief that the goods or services of the defendant are the goods or services of the plaintiff.”5 On the facts of the case for discussion, Halkyard has had many years of success with the marketing of electric guitars since 1867. It is also obvious that the pink guitar has become an identifying feature of Halkyard Musical Instruments. It therefore follows that Halkyard will have no difficulty proving that it has the requisite goodwill or reputation in respect of its pink electric guitar. As for the second leg of the “classic trinity test”6 Halkyard can successfully claim that the remarkably similar packaging and marketing of similar products by Pink Pianos, Pin-Kin-Blax and the ex-employee will likely lead to a misrepresentation that goods offered by these entities are products offered by Halkyard Musical Instruments. The issue is always whether or not the latter product is marketed and packaged in such a way as to create some confusion as to association.7 According to Clayton Utz, Halkyard would not have to prove that it suffered actual damages. It would only have to prove the likelihood that the common law tort of passing off is likely to cause damages. As Clayton Utz explains: “Above all, the law requires deception and damage, or a likelihood of deception and damage, before a remedy will be granted. In other words, it must be possible to prove that the typical customer of those goods or services would recognise the mark or get-up and identify it with the plaintiff and no-one else, AND that this will result in lost revenue.”8 There are circumstances however, in which words or brand names used can bar a propriety right. For example if the name used is merely descriptive of the product it cannot be said to have any special meaning to the user of that name. As an example, the word cola is not unique to Coke but simply describes a particular type of carbonated beverage. Once it can be determined that the word used has a “secondary signification”9 to the product offered it is not merely descriptive and can be claimed as a trade name under the tort of passing off. Therefore, the distant relative may be more difficult to sue for passing off since he or she may be entitled to use the name Halkyard and by doing so is only describing his or her own publications by using his or her own family name. In Frank Reddaway Ltd. v. George Banham, Frank Reddaway manufactured and sold machine belting as Camel Hair Belting for a number of years. A former employee began marketing and selling the same product using the same name. Reddaway sued the former employee and the Court of Appeal found that the words used were merely descriptive and Reddaway could not claim any special interest in them. However, the House of Lords disagreed, ruling that Reddaway had developed a reputation in which members of the public identified Camel Hair Belting with Reddaway’s particular belting material. Lord Hershel said that: “I cannot help saying that, if the defendants are entitled to lead purchasers to believe that they are getting the plaintiffs manufacture when they are not, and thus to cheat the plaintiffs of some of their legitimate trade, I should regret to find that the law was powerless to enforce the most elementary principles of commercial morality.”10 This case is of particular importance to Pink Pianos, and the company marketing hi-fi equipment as pin-kin-blax. The use of the emblem which is very similar to that of Halkyard’s by Pink Pianos, the former employee’s production of a vastly similar acoustic guitar and the use of the term pin-kin-blax are all marketed in such a way as to lead purchasers to the conclusion that the goods are somehow associated with Halkyard’s. All of these features are unique and specific to Halkyard’s and have become identified with it by virtue of its own goodwill and long reputation. It would therefore be an affront to commercial conscience to permit these parties to take advantage of Halkyard’s reputation and goodwill. The courts however, are not always consistent in holding what conduct amounts to a case of passing off. For example in the case of Cadbury-Schweppes Pty Ltd v Pub Squash Co Pty Ltd Cadbury-Schweppes marketed a “solo-lemon” beverage in a distinctive yellow can with a particular campaign. The product was successful and later Pub Squash launched a strikingly similar product, “pub squash” with virtually the same colors and campaign. The court held however that it was not convinced that consumers would confuse the two products.11 The court might very well reach the same conclusion in respect of the hi-fi equipment and the pink pianos since the products themselves are quite different from the pink guitars that have been marketed by Halkyard’s. This uncertainty explains why registration is so important. Quite possibly, Hackyard’s could have obtained adequate protection by registering its tradename and patent. Clayton Utz explains the advantages of trademark registration as follows: “The primary distinction between the common law protection of trade marks and the law under the Trade Marks Act is that, if a trade mark, a name or logo, has been registered, then the registered proprietor is relieved of what is often the heaviest burden in any passing off action, that is, proving the existence of goodwill and reputation associated with the mark. All that need be proved is that the defendant is using that trade mark, or a mark deceptively similar, in relation to the same goods or services in respect of which the mark is registered.”12 Section 10(1) of the Trade Marks Act 1994 provides broader protection in respect of registered trademarks than the protection accounted for in the tort of passing off as follows: "...a person infringes a registered trade mark if he uses in the course of trade a sign which is identical with the trade mark in relation to goods or services which are identical with those for which it is registered..."13 In addition to this protection under Section 10(1) of the 1994 Act, the owner of a registered Trade Mark can successfully claim infringement of his trademark if a competitor launches a similar product using similar colours, names and designs.14 In fact, even if the product offered is not entirely similar to the product covered by the trademark registration a claim will be successful if similar colours, names and designs are used.15 Therefore, had Hackyard’s registered its trademarks and trade names under the Trade Marks Act 1994 they could have prevented the infringements that took place in the year 2000 and beyond. The Trade Marks Act 1995 was enacted pursuant Council Directive No. 89/104/EEC is designed to harmonize the trademarks law of all Member States.16 The Directive laid out a minimum requirement for the registration and enforcement of trade marks within the European Community.17 The Hackyards could have applied for registration of their Trade name and emblem at the UK Intellectual Property Office.18 While it may be too late to prevent the use of the current names and product descriptions, it is not too late to prevent future breaches by registering within the UK and the European Community. Section 3(1)(b) of the Trade Marks Act 1995 provides that the sign which the applicant wishes to register must have distinct characteristics and/or identifiers.19 In the case of Associated Newspapers Ltd v Express Newspapers it was held that the requirement that a sign have a distinct identifier did not require that the sign have a unique identifier.20 It was held that in order to determine if trademark infringement occurred it was only necessary to examine the closeness of the products, the likely impressions made by the signs and marks, whether they will be available to similar users, whether there are similarities in size and design and whether or not they will likely be distributed among similar consumers.21 There is no doubt that the products by the Pink Pianos, the hi-fi company and the former employee are similar in size and design to Halkyard’s products and are very close, although not identical and are obviously distributed among like users. There is a very real possibility for confusion and on this basis. Patent Protection Essentially, patent protection restricts and controls the manner in which others can copy, manufacture, sell and otherwise use a patent without permission from the patent’s registered owner. Obviously, had Halkyard’s registered the pink guitar pick and the acoustic guitar they could have prevented the duplication of these products up to now. They can however, prevent future duplications or exploitations by registration at this point. In the event others use a registered patent without prior approval from the registered owner is at liberty to take legal action for damages in respect of such exploitation.22 The Patents Act 1977 contains the substantive law in respect of patent protection within the UK. The 1977 Act also makes provision for the application of UK patent law within the European Patent Convention as well as the Patent Cooperation Treaty. Subsequent statutory provisions such as the Copyright, Designs and Patents Act 1988, the Regulatory Reform (Patents) Order 2004 and the Patents Act 2004 have modified the Patents Act 1977. 23 Section 60 of the Patents Act 1977 defines infringement of a patent in the ordinary course of business. A patent is infringed when a person does “any of the following things”24 within the jurisdiction of the UK ‘”in relation to the patent”25 without first obtaining the patentee’s permission: “(a) where the invention is a product, he makes, disposes of, offers to dispose of, uses or imports the product or keeps it whether for disposal or otherwise; (b) where the invention is a process, he uses the process or he offers it for use in the United Kingdom when he knows, or it is obvious to a reasonable person in the circumstances, that its use there without the consent of the proprietor would be an infringement of the patent; (c) where the invention is a process, he disposes of, offers to dispose of, uses or imports any product obtained directly by means of that process or keeps any such product whether for disposal or otherwise.”26 It would appear that the acoustic guitar and the guitar pick are patents since they are innovative inventions. Lord Hoffman did not define the term innovative invention in Biogen Inc v Medeva plc [1997] RPC 1 but he did say that the judiciary: “…would be well advised to put on one side their intuitive sense of what constitutes an invention until they have considered the questions of novelty, inventiveness and so forth…”27 Halkyard’s guitar pick has not as yet been duplicated and it is therefore not too late to apply for and receive patent protection of the guitar pick. The acoustic guitar has already been duplicated by a former employee and Hackyard’s may apply for patent protection to prevent future exploitations. The only recourse up to this point is an action in common law for passing off. Conclusion On the facts and the law in relation to passing off and trademark protection Hackyard’s qualify for registration and exclusive use of the terms pink ‘n’ black, the Ace logo, the guitar pick and the acoustic guitar. Had they done so prior to the year 2000 they would have been more secure in the exclusive use of their names, products and the manner in which they describe their goods. While they may not be in a position via patent protection to prevent the distribution of a similar product, they can certainly take steps as previously discussed to prevent the reproduction of that product in the manner and style exploited by each of the parties since 2000. Bibliography Anderson, R. and Gallini, N. T., (1998) Competition Policy and Intellectual Property Rights in the Knowledge-based Economy, Calgary: University of Calgary Press. Associated Newspapers Ltd v Express Newspapers [2003] EWHC 1322 Bainbridge, David . (2007) Intellectual Property. Pearson Longman Biogen Inc v Medeva plc [1997] RPC 1 Cadbury-Schweppes Pty Ltd v Pub Squash Co Pty Ltd [1980] 2 NSWLR 864 Cornish, W.R.,(2003) Intellectual Property: Patent, Copyright, Trade Marks and Allied Rights , London, Sweet & Maxwell. Council Directive No. 89/104/EEC Drexl, J and Kur, A. (2005) Intellectual Property and private international Law: heading for the future, Oxford: Portland, Oxford: Hart Pub. Frank Reddaway Ltd. v. George Banham, [1896] A.C. 199 Llewelyn, Margaret Dr. Proposals for the Introduction of a Community Utility Model System: A UK Perspective. [1995] 2 Web JCLI http://webjcli.ncl.ac.uk/articles2/llewel2.html Viewed December 22, 2007 Patents Act 1977 Reckitt & Colman Ltd v Borden Inc [1990] 1 All E.R. 873 Trade Marks Act 1994 Utz, Clayton and Knight, Peter. (n.d.) Protecting the Brand: The Law of Passing Off and Registered Trade Marks. Available at: http://216.239.51.104/search?q=cache:oaoPeeAhiEwJ:www.claytonutz.com/redirector.asp%3Fdoc%3D1433+Clayton+Utz.+Protecting+the+Brand,+The+Law+of+Passing+off+and+Registered+Trademarks&hl=en&ct=clnk&cd=1&gl=us Viewed December 22, 2007 Read More