A recent Court of Appeal (CA) ruling has highlighted the importance of assignees/licensees of patents registering their interests with the Intellectual Property Office (IPO) without delay.

The patents concerned, held by the claimant, Schütz, were for a bulk container for liquids that contained a flexible bottle in a metal cage. The defendant, Werit, had used the product and replaced damaged or worn bottles with bottles that it had developed. The bottles were then sold in the original caging.

The Court of Appeal overturned the High Court’s ruling and held that the patented product should be considered as a whole, and the cage and the bottle as component parts. By putting a new bottle into the cage, Werit was effectively completing the patented product. In doing so without a licence, Werit had infringed Schütz’s patent.

However, Schütz’s patent licence was granted in 1994 and not registered until 2008. Section 68 of the Patents Act 1977, as amended in 2006, provides that “…the court…shall not award [the claimant] costs or expense unless…the transaction, instrument or event is registered within the period of six months beginning with its date…”. Nonetheless, the CA decided it would not be unfair for Schütz to recover costs for the period after it had registered its licence as it had ‘put its house in order’.

All assignees or licensees of patents must protect their interest by registering it with the IPO. This ensures potential third party purchasers are put on notice of the interest and will protect a costs claim in the event of patent infringement.

(Case: Schutz (UK) Ltd v Werit UK Ltd and another [2011] EWCA Civ 927, 2011)

Patents are now the corporate weapon of choice for both shielding commercial interests and vanquishing upstart rivals.

Google has accused Microsoft and Apple of trying to undermine Android by buying up technology patents to drive up the cost of Android-powered devices. The licence fees charged for the use of the patents could arguably amount to an extra tax on companies and choke them out of the market. Following the blog post comment, Microsoft retaliated by stating that Google had been invited to bid with it on key patents but turned them down.

Apple and Samsung are suing each other in courts around the world over the rights to tablet technology. The patent dispute has caused Samsung to cancel the launch of its Galaxy tablet in Australia.

Rovio, the makers of Angry Birds (which has just surpassed 300 million downloads), is being sued by patent licensing company, Lodsys. Licensing companies, essentially acting as patent banks, are being criticised for protectionist patent purchasing which is stifling innovation and has the potential to distort the technology market if anti-competitive licence fees are demanded. Reports also abound of aggressive intimidation tactics where they sense a whiff of infringement.

Speculative spending on patents allows companies to sit back and gauge the value of technology; before swooping to reap licence fees or issue proceedings where it proves profitable.

In the world of technology, patents can make or break a company. And, somewhat predictably, it is the creative spirit of an entrepreneurial startup that ends up broken.

The High Court has ordered BT to block access to Newzbin2, an illegal filesharing site. The original Newzbin site was shut down following a successful action for copyright infringement. However, it appears the operators simply upped anchor and moved offshore, beyond the reach of the UK courts, and set up Newzbin2, an almost identical website located at the same URL. So now the industry has set its sights on the ISPs.

The successful test case against BT was brought jointly by 20^th Century Fox, Universal, Warner Bros, Paramount, Disney and Columbia Pictures, all members of the Motion Picture Association (MPA). The landmark ruling has generated headlines, debate and trended on Twitter. However, the blocking technology won’t be finalised until October. Ironically, the movie industry bosses have ensured that now more people than ever know about the notorious Newzbin site and they have three months to plunder and pillage the site’s content.

This is clearly not the silver bullet in the fight against online copyright infringement. Blocking sites via ISPs naively underestimates the ability of the internet to evolve and circumvent restrictions. It also raises questions of censorship, initiated by deep-pocketed Hollywood moguls protecting their commercial interests.

Perhaps, rather than suing every variant of every website and cutting off one head to watch two grow back, the industry should listen to its customer base. The music industry is getting the hang of legal downloads, why not TV and movies?

The privacy debate rages on. The dark, faceless forces of ‘technology’ stand accused of invading our personal spheres, snooping, spying and exploiting consumers.

The backlash could be devastating for technology companies that handle highly sensitive personal data, in particular, providers of location-based services (LBS)  – applications and websites that provide services or information based on your current location. This includes apps/websites that let you find the nearest cashpoint, automatically show your local weather forecast, and allow you to ‘check-in’ at that new wine bar.

Following the rise of smartphones, this emerging market has the potential to transform the way we interact with our surroundings. However, it also provides companies with a robust history of an individual’s movements which, when combined with other personal data, builds a disturbingly detailed consumer profile.

In the light of various privacy leaks, consumers are becoming wary about collection and abuse of their personal details and location privacy. Fears about increasing intrusion from e-behemoths such as Google and Facebook has made consumers sceptical and even cynical. In this competitive market, businesses need to act now in order to build consumer trust in LBS or risk alienating both existing and potential users. Mechanisms to safeguard consumer privacy will ensure users feel comfortable and enhance brand loyalty.

While the law catches up with technology, businesses have the opportunity to stand out from the tech crowd and empower consumers to take control of their own personal data and location information. A clear, strongly worded privacy policy and the use of privacy-enhancing technologies such as anonymisation and encryption will address consumer concern and avoid negative publicity. Companies need to balance consumer trust against data mining and conclude that the commercial value of establishing robust privacy protection is paramount to a sustainable business model.

This alert was written by Simon Halberstam (partner) at SIMONS MUIRHEAD & BURTON LLP. If you need assistance, please contact Simon Halberstam on 020 3206 2781 or simon.halberstam@smab.co.uk

On 26 May 2011 the law governing the use of cookies will change. Users will need to be provided with an opportunity to explicitly give their consent prior to having cookies downloaded on to their computers or mobile devices.

Frustratingly the government and the Information Commissioner’s Office (ICO) currently have no clear idea as to how the new legislation on cookies should be implemented by web managers. There is no guidance in the amended E-Privacy regulations as to exactly how “consent” should be given. The Government has left that remit with the ICO, and, as its latest briefing highlights, there is as yet no clear-cut method of ensuring compliance.

The consequences of non-compliance

UK-based web managers that do not make any changes to their websites before the morning of 26 May will not automatically be liable to a fine from the ICO. The ICO recognise that implementation of the new law will need to be phased. However, what all web managers need to be doing now is considering and planning their options for achieving compliance. If the ICO were to make any enquiries into a website shortly after the 26 May, a response explaining such preparatory steps might well be enough to avoid any sanctions. However, failing to make any changes to your website and being unable to demonstrate any consideration of implementation methods could lead to sanctions from the ICO.

What needs to be done now?

Web managers in the UK should therefore be doing the following:

• Ascertaining what type of cookies are used by their sites and how they are downloaded onto users’ machines (effectively a “cookie audit”).
• Deciding on which method(s) of obtaining consent is best for their website, given the cookie audit.
• Recording the cookie audit and implementation methods in an easily digestible form should the ICO ever investigate the site during this transitional period.

Suggested methods of implementation

The list is non-exhaustive and will doubtless get longer, but here are a few options which have been suggested to procure user consent before cookies are downloaded:

• Pop-ups each time a cookie is to be downloaded onto a user’s machine.
• Having in place a privacy policy setting out the site’s use of cookies; the terms of which a user must positively agree to upon visiting the site (i.e. via a tick box).
• Settings and feature-led consent. If cookies are downloaded when a user does something e.g. watches a video or personalises the site, obtaining the user’s consent prior to that action for compliance.

Web managers should be reminded that where the use of cookies is “strictly necessary” for the disclosed central purpose of the site, no consent needs to be given by the end user to their deployment. The most common situation in which this applies will be where a website remembers the contents of a user’s shopping basket as they navigate the site.

What next?

Ultimately, it is intended that consent will be provided through users’ web browsers and the Government is currently working with the major browser manufacturers to this end.

The ICO will be drafting further advice on the new law in the near future, potentially including other suggested methods of compliance and also how and when it intends to begin enforcing the regulations.

This alert was written by Simon Halberstam (partner) at SIMONS MUIRHEAD & BURTON LLP. If you need assistance please contact Simon Halberstam on 020 3206 2781 or simon.halberstam@smab.co.uk

Almost everyone has experienced the irritation of the phone ringing just as you are sitting down to eat. You then scramble to answer it, only to discover that you are being interrupted on the off chance that you are interested in [double glazing] [consolidating your debts] [changing your gas/electricity/phone/internet service provider] (delete as appropriate).

The Information Commissioner’s Office (ICO) will soon have increased powers to investigate the companies making these nuisance marketing calls and also the companies behind the unwanted emails which consistently clog up your inbox. The ICO will also be able to fine companies up to £500,000 in the most serious cases; a sum which may prove to be a more effective deterrent to smaller marketing companies than it is to the corporate giants which collected your personal data in the first place.

The changes, which come into force on 25 May 2011, also introduce the requirement for telecommunications companies and internet service providers to notify the ICO and their customers in certain circumstances when a personal data breach occurs. The ICO will have the power to audit these companies to ensure compliance with the regulations.

These changes are unlikely to herald the end of unwanted, intrusive marketing campaigns. However, as technology is now allowing increasingly targeted advertising, perhaps there will soon be a better chance of receiving that phone call when you are actually in need of new windows.

This alert was written by Simon Halberstam (partner) and Lauren Evans (trainee solicitor) at SIMONS MUIRHEAD & BURTON LLP. If you need assistance, please contact Simon Halberstam on 020 3206 2781 or simon.halberstam@smab.co.uk

Recent revelations in the technology sector suggest this is exactly the feeling you should get whenever you’re surfing the net or turn on your smartphone. As technology advances, companies are finding ever-more ingenious ways to spy on us and we remain completely oblivious.

Protectors of online privacy have, for a while now, voiced their fears surrounding cookies. These are files downloaded onto our machines from websites which can track our internet surfing habits, allowing online advertisers to place in front of us an array of products seemingly matching our tastes and which we should be itching to purchase. The EU isn’t impressed with the ease with which cookies find their way on to our machines and the amended E-Privacy Directive (to be implemented into UK law by 25 May 2011) calls for end- users to provide positively their consent to any cookies downloaded onto their machines by EU-based websites. Exactly how Parliament implements the EU Directive into law remains to be seen, as one interpretation of the Directive would result in endless pop-up windows asking for our consent to cookies. However, the Government has voiced its desire for a more sensible method of implementation, based around opt-in web browser settings. Check out the blog in the near future to see how things develop.

Having a seemingly harmless natter on one’s smartphone also brings up privacy concerns. Recent research has confirmed that Apple’s iPhone and phones running on the Android operating system periodically collect data on the phone’s location. This information is saved locally on the phone and, worringly, also sent to Apple and Google either when the phone is synced to a PC or Mac (iPhone) or via periodic transmissions from the phone itself (Android). Many smartphone owners have successfully extracted this data and created maps of their movements going back as far as a year. Philanderers beware – your movements can easily be traced!

Getting from A to B while on-the-go has been made a great deal easier due to Google Maps and its ‘Street View’ function. Some of you may recall actually seeing Google’s Street View cars filming images of the streets near you, which can now be seen online by anyone. What you may not know is that, while filming those images, those Street View cars were also scooping up data from any wi-fi network in their range which was unencrypted. Data collected included complete e-mails, email-addresses, usernames and passwords. Google has suggested that this data was collected unintentionally and, in the case of data collected in England, has now been deleted. Seemingly, even when they’re not trying, these companies invade our privacy!

Clearly, it is almost impossible to use ‘smart’ technology whilst keeping personal data private. So, rather than worrying about how companies collect our data, perhaps we should be turning our attentions to the security systems they have in place to protect it once they have it. This is not just an issue for people communicating with each other, but for those using a common platform, such as the 77 million users of the Sony Playstation Network (which allows PS3 owners to play games online with one another). There is a possibility that their personal information (e.g. names, addresses, dates of birth, passwords and credit card details) could be in the hands of hackers who infiltrated the Playstation Network last month. Should Sony be deemed to have breached data protection laws, the Information Commissioner’s Office (ICO) now has the power to fine it up to £500,000. Big deal! It is almost impossible to protect our personal data when we turn on our gadgets, therefore the ICO must dish out truly punitive sanctions to discourage the invasion of our privacy.

This alert was written by Simon Halberstam (partner) and Andy Solomon (solicitor) at SIMONS MUIRHEAD & BURTON LLP. If you need assistance, please contact Simon Halberstam on 020 3206 2781 or simon.halberstam@smab.co.uk

Simon Halberstam commented on the recent data leak scandal which Sony are currently facing on VG24/7’s website.  The case has been described as potentially being the worst hacking crime in history due to the vast number of people who have been affected and could potentially have had their card details stolen.

Click here to read the full article.

The new legislation generally entails that existing privacy policies/notices must be reviewed to achieve compliance.

We have recently been assisting clients in this area.

For further information, please contact Simon Halberstam at simon.halberstam@smab.co.uk or by phone on 020 3206 2781.

Cookies (the inedible kind) are an integral part of any web user’s experience. Unlike the edible kind, web cookies split opinion massively, either being described as facilitating a personalised, easy-to-use web browsing experience or a method of invading one’s privacy, seemingly without permission.

Cookies are text files which are stored on users’ computers when they visit certain web sites.  When the website is revisited in the future, the browser returns the information contained in the cookie to the website, as a memory of what the user previously did on the site. Although stored on a user’s hard drive, cookies cannot read any information on the hard drive and cannot be executed as code and are therefore incapable of transmitting computer viruses.

Their uses however, can be seen as both good and bad. As they serve to ‘remember’ what you have done while browsing a site, they can serve extremely useful purposes, such as recalling your username for a login on a web page, the contents of your virtual shopping basket should you navigate away from a site, or your preferences for page layouts and colour schemes on specific sites. As such, they can serve to personalise the web and make your browsing experience much easier.

Third party cookies are usually those which have been viewed with the most suspicion, as their primary aim is to track a user’s actions and movements as he/she surfs the web. When a user opens a web page, it may have within it information from various third parties, for example, advertisers. These third parties can, if your browser allows them, place cookies onto your computer and then, whenever you log onto another site where their content is present, the cookie on your computer will let that third party know. By this third party cookie tracking, online advertisers can build up profiles of your internet surfing history and create targeted advertising campaigns catering to your tastes, explaining why adverts for products you like always pop up on sites you visit online.

The seemingly surreptitious use of third party cookies has been viewed in some quarters as an invasion of personal privacy, hence (in part) the passing of directive 2009/136/EC (the “Directive”) in December 2009 which amended the E-Privacy Directive (2002/58/EC). The Directive states that cookies may only be used by website owners if they provide clear and comprehensive information about their purposes and with the end user’s consent (an opt-in). The rationale behind the amendment being that users are made more aware of the use of cookies by the websites they visit. However, user consent is not required where cookies are necessary to deliver a service which has been explicitly requested by a user, for example when shopping in an online store and cookies are used in respect of the items in the consumer’s shopping basket. The UK must implement these measures into its legislation by 25 May 2011. Draft regulations to implement the Directive into UK law are set to be laid before Parliament at some point in April 2011.

The UK Department for Business, Innovation and Skills (“BIS”) published a consultation on the implementation of the Directive in September 2010, setting out the government’s approach to implementation in a BIS Impact Assessment (the “IA”). The IA recognises that cookies are used on practically every web page a user visits and that generally, consumers place more value on internet advertising that is targeted and relevant to them. Significantly, the IA also recognises that online behavioural based advertising is big business, estimated to be worth £740 million to the British advertising industry by 2012.

In the IA, the government has therefore rejected the stance that, practically, the Directive calls for a need that all end users must provide their confirmation every time a cookie is placed on their computer. This would require repeated pop-up windows on every web page visited by a user, which would be impractical. This would also put UK websites at a competitive disadvantage compared with non-EU sites (which don’t require opt-ins for the use of cookies), thus potentially drastically reducing advertising revenues in this country. Instead, the Government intends to implement the Directive by allowing consent to the use of cookies to be given via users’ web browser settings. Full cookie controls are contained within web browsers (as acknowledged in a recital to the Directive), therefore it is proposed (in the IA) that browser owners provide users with “information about cookies and how to change the browser settings” and website owners provide users with “clear and comprehensive information about cookies” used on their sites. The IA goes on to specify that the proposed burden on website owners is that, to the extent needed, they must “make it clearer on their websites the cookies that would be downloaded and their purposes.”

The Government therefore aims to implement the Directive without massively disrupting our web browsing experience. Practically, the implementation requirements in the IA will require many websites’ privacy policies to be expanded with full details of all cookies (both first- and third-party) being used on the sites. Also, browser owners will have to ensure they provide users with detailed instructions on how to manage cookies, which is commonly done through the privacy settings on browsers such as Internet Explorer, Firefox and Chrome.

The stance of the Government in the IA is yet to be solidified in a draft statutory instrument. Moreover, the web browser implementation method proposed above flies in the face of the (non-binding) opinions of the EU Article 29 Working Party, which, in June 2010, suggested that member states implement the Directive by enacting legislation with strict opt-in requirements on users (i.e. pop-up windows every time it is sought to place a cookie on a user’s computer). Whether the Government sticks to its stance in the IA will only be revealed once the relevant draft statutory instrument is published in April.

This alert has been written by Simon Halberstam (partner) and Andy Solomon (solicitor) at SIMONS MUIRHEAD & BURTON LLP. If you need help with drafting/revising privacy policies or other input, please contact Simon Halberstam on 020 3206 2781 or simon.halberstam@smab.co.uk

Simon Halberstam discusses how the recent move by online gaming operators into gaming software and the gradual shift towards market liberalisation (at least in Europe) have changed the nature of multi-jurisdictional partnerships in the industry. One constant, however, is the myriad of legal and regulatory burdens for which operators must be prepared.  Click here to read the full article.

World Online Gambling Law Report

Just as the “greyhairs” are warming to email, the younger generation is abandoning it. Yes, rumour has it that email is dead and that our children only communicate through Facebook.  However, website-socialization is itself under threat and it may not be long before i-phone and other mobile apps sound the death knell for Facebook and the already receding Myspace.

I don’t want to show my age but I can still remember the days when children went round to each other’s houses, bought records in the High Street and played conkers  in the playground. Nowadays they communicate through Facebook, download music through i-tunes and play games on Miniclip, Gamesloth and Friv and on apps such as the ubiquitous Angry Birds.

The move to social media is not merely a cultural phenomenon, it also has profound legal consequences.

Twitter – Copyright and Defamation

Not only is re-tweeting frowned on from a marketing perspective but it also entails the risk of copyright infringement. Original tweets attract literary copyright whether the expression of an individual viewpoint or just a glorified self-indulgent report of a supposed celebrity’s daily schedule.

140 characters are also more than sufficient to run the gauntlet of defamation.  Addicted tweeters need to keep their audience interested and growing. Knocking copy whether pejorative or merely salacious is still one of the best ways to achieve this.  Think before you tweet!

Indeed any interactive forum on any website poses risks. Wherever people have the opportunity to pass comment about others exposes the website owner to the risk of libel proceedings. However, assuming the site is un-moderated, swift take-down of the allegedly defamatory comments is usually the remedy. Such reaction enables the owner to avail itself of the innocent dissemination defence under Section 1 of the Defamation Act 1996.

It is key for website owners to have appropriate terms and conditions on their websites governing access to and use of such forums including an acceptable use policy.

Facebook – Privacy and Copyright

The term “friends” no longer connotes a person you have necessarily met – the rush to build up a critical mass of friends on social networks such as Facebook often ignores such niceties.  My children maintain that they choose which of their details are seen by which of their “friends”.  I am sceptical.  Facebook needs to monetize those in its thrall and the provision of potential customer-targeting information to advertisers does not sit easily alongside the concept of privacy.

Apparently, Facebook is now a key source of evidence in many divorce trials. Statements made as to whereabouts and activities by a party are often undermined by the publication of communications with friends or photos by the person or someone in his or her network.

The copyright infringement issues associated with the likes of likes of Napster and YouTube are well rehearsed. However, with the choice by Warner Bros of Facebook as an online rental platform for “The Dark Knight,” the 2008 Batman film, the scope for file sharing and copyright infringement on social networks becomes ever greater.

Virtual Worlds – Second Life –Trademarks

Most people will understand the issues behind recent cases against eBay by brand owners such as LVMH regarding alleged trademark infringements relating to counterfeit goods being sold via its website.

However, one step further removed from the old-fashioned human interaction referred to above is the weird galaxy of Virtual Worlds; the most prominent being Second Life. Here you can forget your anxieties about excess weight, receding hairlines and blotchy complexions and appear as your idealized alter ego.   Indeed so popular is this virtual reality that participants spend real money on decking out their avatars with designer clothes and other fripperies. This bizarre conflation of the real and the virtual raises real Intellectual Property issues. What, for example, if your avatar is wearing a Juicy Couture top or a Rolex watch without the permission of the trademark owners?

The bad news is that the world seems to be an ever more complicated place and the displacement of the physical by the digital and virtual exacerbates that. The good news, of course , is that this all makes for considerably more legal work for the likes of this author!

Simon Halberstam is a partner specialising in social media and ecommerce law in the corporate department at SIMONS MUIRHEAD & BURTON LLP.  For further information, please contact him on 00 44 020 3206 2781 or via email at simon.halberstam@smab.co.uk.

As we all know Sky is a hugely successful broadcasting phenomenon. A major part of Sky’s success stems from its broadcasting rights in respect of major sports events and, in particular, the rights it holds to the broadcasting of Football Association Premier League (“PL”) matches. At present it holds 5 of the 6 broadcasting packages awarded by the PL. It would probably have all 6 if the European Commission had not raised objections to Sky’s dominance in the past and negotiated a settlement to the effect that no single bidder could win all the marketed packages.

As PL matches are, by far, the most popular sports broadcasts in the UK, Sky’s rights, which continue until 2013, give Sky an effective stranglehold over pubs and other venues that wish to broadcast live sports.

The PL grants exclusive licences to broadcasters on a territorial basis so that while Sky (and ESPN) have exclusive rights to broadcast in the UK, foreign broadcasters are awarded the equivalent exclusive rights for their respective jurisdictions. Whilst PL matches are also popular in many other countries, interest is obviously highest in the UK so that the PL can obtain far higher sums in the UK auction than elsewhere. However, as the business is so profitable, UK broadcasters, notably Sky are willing to pay “top dollar” to secure these rights.

All well and good for both the PL and Sky until the advent of a certain Karen Murphy, redoubtable landlady at the “White Red and Blue” in Southsea. Mrs. Murphy wanted to show live sports in her pub but contends that she could not afford Sky’s charges. She therefore subscribed to Sky’s Greek counterpart, Nova, the PL’s licensee for Greece using a Greek viewing card and decoder obtained through Mrs. Murphy’s co-defendant QC Leisure.

The PL claims that by purchasing the card and equipment, Karen Murphy was illegally circumventing the exclusive rights of the PL’s authorised domestic broadcasters.

However, as we all know, the idea behind a “common market” is that there should be a single European market without trade barriers so that competition is enhanced and efficient businesses and cost-conscious consumers both benefit.  The Common Market is underpinned by various freedoms enshrined in the Treaty of Rome and subsequent multi-lateral treaties.

These freedoms include the freedom to provide services and goods across EU borders (Articles 28 and 49 EC Treaty) without restriction unless restrictions can be justified on the basis of general interest objectives such as protection of public policy, notably consumer interests.  The disagreement between Sky and Karen Murphy therefore distils into a clash between fundamental freedom and competition principles of European law on the one hand and copyright and associated broadcasting rights on the other.

Mrs. Murphy and QC Leisure have both been prosecuted in the High Court and both cases were referred to the European Court of Justice (ECJ) under Article 234 of the Treaty of Rome to resolve this collision between copyright holders’ licensing rights and freedom of movement principles enshrined in the European Treaty.

Both cases raise the fundamental question as to whether in the EU there is really a single unified PL broadcasting rights market or a fragmented territorial one. This is a vital issue for broadcasters and rights holders and Sky was allowed to intervene in this case in order to participate in the reference.

This is a very complex situation and before further consideration, it is worth setting out the battle-lines in the form of the key legal provisions:

• Article 28 EC Treaty (freedom to provide goods)
• Article 49 EC Treaty (freedom to provide services)
• Article 81 EC Treaty (prohibits contractual obligations which appreciably prevent, restrict or distort competition)
• Sections 1 and 6 UK Copyright, Designs and Patents Act 1988 (CDPA) (copyright in broadcasts)
• Article 3 of the Information Society Directive Directive 2001/29/EC (authors to have exclusive right to authorise or prohibit any communication to the public of their works, by wire or wireless means)
• Section 298 UK Copyright, Designs and Patents Act 1988 (CDPA) (copyright holder control of conditional access technology e.g. decoder cards).

The key questions referred to the ECJ are as follows:

1. Do Articles 28 or 49 of the EC Treaty preclude enforcement of a provision of national law in a Member State which makes it unlawful to import or sell a satellite decoder card which has been issued by the provider of a satellite broadcasting service in another Member State on the condition that the satellite decoder card is only authorised for use in that other Member State?
2. Where a programme content provider enters into a series of exclusive licences each for the territory of one or more Member States under which the broadcaster is licensed to broadcast the programme content only within that territory (including by satellite) and a contractual obligation is included in each licence requiring the broadcaster to prevent its satellite decoder cards which enable reception of the licensed programme content from being used outside the licensed territory, does this contractual restriction contravene the prohibition imposed by Article 81(1) on contractual obligations which appreciably prevent, restrict or distort competition.

If QC Leisure and Mrs. Murphy are correct then the PL’s exclusive territorially based licensing arrangements infringe EU anti-trust and free movement laws as such agreements preclude European citizens from being able to benefit from an open competitive market and thereby preclude them from purchasing live PL matches from the cheapest EU provider.

Moreover, the defendants argued that the arrangement between the PL and national broadcasters infringe EC law because they preclude each authorised licensee/broadcaster from screening live pictures outside its own designated territory; and because they preclude consumers from viewing, or purchasing decoders to view, live PL matches from any broadcaster other than the one with the exclusive national rights.

The Advocate General, Professor Juliane Kokott has now opined and where the Advocate General leads, the ECJ usually follows.

In her opinion, the showing of Premier League live matches in pubs does not constitute communication to the public under Article 3(1) of the Info Society Directive therefore no violation of copyright could be affirmed, as no such communication occurs. In particular, she stressed that the showing of TV programs in bars and pubs does not fall within a specific category identified in the Info Society Directive, i.e. the communication to the public not present at the place where the communication originates (Recital 23). She believes that – when publicans show TV programs – the relevant public (i.e. the pub customers) is present at the place where the communication originates. In other words, the communication would originate on the TV screen (paragraph 144 of the opinion).

Exclusive national rights have been the lucrative basis on which the PL and Sky have based their business models and the aim of the PL is to secure the protection of its rights (and revenues) by procuring a ban on the import, sale, installation and use of ‘foreign’ decoders. If the ECJ upholds the Advocate General’s opinion, this will mean that the use of foreign decoders will be legitimate and this will undermine both the exclusivity arrangements and the concomitant value of the licensed rights.

This is, however, a big “if” as there have already been many comments, both neutral and partisan which question the validity of the Advocate General’s opinion and suggest that it is inconsistent with existing case-law. The ECJ will make a ruling on the matter later this year.

If upheld, this opinion will almost certainly lead to the development of a new trans-European licensing model. In principle this should mean more competition and a resultant better deal for UK consumers (and pub owners). However, in light of the fact that the PL screening packages are bound to be astronomically expensive and only justifiable for those who have an extensive UK customer-based, it is likely that Sky, albeit at a greater cost, will be able to maintain and, perhaps even extend its reach and power and this could ultimately result in a worse deal for the UK consumer.

Please click here to email Simon Halberstam, Head of Technology Law, or call 020 3206 2781.

The founders of Google recently said that they could never have founded the company in the UK as the copyright laws are far too restrictive.  David Cameron has taken this to heart announcing not only a planned shake-up of outdated coyright law but also the intention to turn the Olympic Village and parts of East London into a new silicon valley. 

There is always a  balance to be struck between, on the one hand, protecting and rewarding the investment of those who create new work and, on the other hand, not stifling the efforts of downstream and aggregating enterprises which feed off such creativity. In the UK we generally favour the interests of the copyright owner whereas in the US the ‘fair-use’ provisions enable the reproduction of copyright works for various purposes where such reproduction may be considered fair. These include criticism, comment, news reporting and research.

To some extent, the introduction of the “Fair use” doctrine in the UK would do little more than legitimise what is already widespread and what many see as harmless. For example, it would enable those who have bought a CD to format shift the content to an MP3. Parodies such as the “Newport” Welsh rap version of Empire State of Mind by Jay Z and Alicia Keys, a song about New York would no longer be actionable removing the legal threat hanging over websites such as YouTube vulnerable if they ignore “cease and desist” demands. 

 I anticipate a long-running and bitterly fought battle between the libertarians and the defenders of copyright with lobbyists and lawyers already lining up on each side.

 For further information, please contact Simon Halberstam at simon.halberstam@smab.co.uk or on 020 3206 2781.

The rise of Google has been well documented. Created by Larry Page and Sergey Brin in 1996 whilst the pair undertook PhDs at Stanford University, what started as a research project concerned with making search engines more efficient has now grown into a hi-tech behemoth with revenues in 2009 exceeding twenty three billion dollars.

Google’s core offering remains, of course, online advertising. However, the company is so innovative that the law is often having to play “catch-up”. Indeed not only is Google re-drawing the legal landscape but also that of the earth.

We will take a brief look at some of the major issues that have arisen.

AdWords

Google, through its AdWords programme, allows advertisers to ‘purchase’ keywords to place their website at or near the top of the results page when an internet user searches for that keyword. This led to complaints that Google was enabling trademark violation, as ‘Company A’ could purchase a keyword identical to a registered trademark of ‘Company B’, enabling the former to benefit by appearing in its competitor’s search results. Designer label Louis Vuitton took legal action against Google, but in March 2010 the European Court of Justice (“ECJ”) ruled that Google had “not infringed trademark law by allowing advertisers to purchase keywords corresponding to their competitors’ trademarks”.

Although Google was exonerated, the ECJ did intimate that advertisers themselves could be guilty of trademark violation, and in October Interflora commenced proceedings against Marks & Spencer over a similar use of the AdWords programme. While this case is yet to be decided, the fact that large companies are litigating over a Google service shows how influential the company has become, not just in the internet search engine market, but as a huge player in global advertising.

Street View

The controversial Street View project – where users can travel virtually down almost any street in the UK and other cities across the world – has recently suffered some unwelcome publicity after it emerged that the cars deployed to capture images of street scenes were also grabbing individuals’ personal data from unsecured wireless networks. This led to the Information Commissioner’s Office censuring Google for a ‘serious breach’ of the Data Protection Act, though it escaped a fine by persuading the ICO that the breach was accidental and would be immediately rectified. Nevertheless, this incident demonstrates the scale and reach of Google’s services, and the potential ramifications when hi-tech companies make mistakes.

Google Maps

In perhaps the most extraordinary example of Google’s impact, an inadvertent mistake on its Google Maps function has been attributed as the cause for Nicaragua ‘invading’ Costa Rican territory. The Google map of the Nicaragua/Costa Rica border (based on information supplied by the US State Department) showed land widely believed to be Costa Rican soil as being part of Nicaragua. The Nicaraguan army used this as legal justification for its view that the land was Nicaraguan and sent troops to the region. Although the Organisation of American States has insisted that the troops be withdrawn, debate over the region’s future has intensified, with Nicaragua refusing to remove their troops and the dispute threatening to expand across the continent as neighbouring countries take sides.