Amateurism doesn’t work for IP

amateurismScenario 1: A university employs specialists to negotiate intellectual property (IP) contracts. But they tend to be relatively junior in the university hierarchy, and don’t have the ultimate decision-making authority, particularly if the academic most interested in the contract objects to their approach. Decisions are pushed upstairs to senior management who have little or no understanding of IP or contractual issues.

In some cases, the university thinks it has solved this problem by forming an IP committee to take decisions. But the members of the committee, if they have any understanding of IP, perceive it from a very high level, and tend not (in IP Draughts’ limited experience) to fill the professionalism-deficit. Alternatively, some universities appoint a senior member of the management team to be responsible for enterprise activities; however, the person who is chosen tends to be an academic rather than a professional. A Deputy Vice Chancellor for Enterprise once complained to IP Draughts that he hated looking at contracts. IP Draughts is still mentally reeling from this statement, years after it was made.

Scenario 2: A trade organisation lobbies on a wide range of issues that affect their members. An IP policy issue comes up. Somewhere deep in the organisation is a person or team who understand IP, and they make sensible suggestions. But the lobbying is fronted by people who don’t have a deep understanding of the subject. They think they can handle it with their usual toolkit of personal charm and a two-page briefing note. But they don’t understand the subject well enough to do a competent job.

Scenario 3: A commercial lawyer, who has no real experience of thinking about and negotiating IP issues, negotiates an agreement that incorporates IP ownership and licensing terms. Unless they are very careful, they are likely to do a sub-optimal job on the IP terms. They will probably modify a template that they have found that contains IP terms. In one case that is on IP Draughts’ desk at present, they have used a published precedent that IP Draughts and his colleagues drafted, and some of the original wording of the precedent lies undisturbed, surrounded by devastation.

cioIn the business community, there have been debates about whether company boards of directors and senior management teams should include information technology (IT) specialists, given the importance of IT for many businesses and the complexity of the subject which makes it difficult for a non-specialist to understand. There are many published examples of large organisations spending millions on IT systems that don’t work. In US corporations, which sometimes appear obsessed with job titles that subtly discriminate between levels of seniority (president, vice president, executive vice president  and so on), this debate has sometimes focussed on whether corporations should have chief information officers, or CIOs.

This debate has some similarities with the issue that faces IP practitioners. IP Draughts knows dozens of IP lawyers who have the necessary IP experience and commercial insight to make high-quality business and policy decisions, whether in the context of universities, commercial companies or trade organisations. But rarely does he see them in general management roles. Perhaps they are not suited to those roles. When it comes to decision-making on IP-related topics, perhaps general managers should recognise their limitations, and delegate authority to the professionals.

How this should be done is not always clear. It is probably not workable to expect external law firms to take business decisions on behalf of their clients. An alternative model might be for organisations to delegate decision-making authority on technical subjects to an individual or committee. This could work if (1) genuine professionals are appointed, who have the necessary professional skills to understand the subject and take sound decisions on behalf of the organisation, and (2) their decisions are supported by the body that appointed them.



Filed under Intellectual Property, Legal policy, Legal practice

Negotiating techniques in Shakespeare

henry vIP Draughts and the Draughtatrix have just returned from a visit to Stratford Upon Avon, to see a production of Henry V.

It was well worth seeing even if, like IP Draughts, you don’t find Shakespeare’s history plays as engaging as some of the tragedies and comedies.

IP Draughts was pleased to hear a greater focus on articulating the meaning of the words than in some other productions that he has seen at Stratford. The excellent Oliver Ford Davies, as the Chorus, was particularly good at communicating his lines.

Olver Ford Davies in an earlier role as a Queen's Counsel

Oliver Ford Davies in an earlier role as a Queen’s Counsel

Just as IP Draughts’ attention was flagging, part-way through the second half, Shakespeare has the representatives of England and France enter into negotiations for a merger of the French and English thrones. As part of this corporate transaction, Henry V acquires the French king’s daughter in marriage. (Like many M&A deals that are fuelled by personal ambition and ego, this turns out to be an unworkable vanity project, and is reversed a generation later.)

Shakespeare reminds us of some core elements of successful negotiations:

1. Read the documents carefully and discuss their meaning.

King of France: I have but with a cursorary eye
O’erglanced the articles: pleaseth your grace
To appoint some of your council presently
To sit with us once more, with better heed
To re-survey them…

2. Assemble a good negotiating team, give them clear instructions and authority to negotiate; leave the CEO out of the detailed negotiations.

King Henry V: Go, uncle Exeter,
And brother Clarence, and you, brother Gloucester,
Warwick and Huntingdon, go with the king;
And take with you free power to ratify,
Augment, or alter, as your wisdoms best
Shall see advantageable for our dignity,
Any thing in or out of our demands,
And we’ll consign thereto.

3. Involve people who can mediate solutions.

Queen Isabel: Our gracious brother, I will go with them:
Haply a woman’s voice may do some good,
When articles too nicely urged be stood on.

4. Don’t concede too early.

French King: We have consented to all terms of reason.

Exeter: Only he hath not yet subscribed this:
Where your majesty demands, that the King of France,
having any occasion to write for matter of grant,
shall name your highness in this form and with this
addition in French, Notre trescher fils Henri, Roi
d’Angleterre, Heritier de France…

5. Don’t claim it is a deal-breaker if it isn’t. Secure something of benefit in return for an unattractive concession.

French King: Nor this I have not, brother, so denied,
But your request shall make me let it pass.

King Henry V: I pray you then, in love and dear alliance,
Let that one article rank with the rest;
And thereupon give me your daughter.

French King: Take her, fair son, and from her blood raise up
Issue to me; that the contending kingdoms
Of France and England, whose very shores look pale
With envy of each other’s happiness,
May cease their hatred, and this dear conjunction
Plant neighbourhood and Christian-like accord
In their sweet bosoms, that never war advance
His bleeding sword ‘twixt England and fair France.

The last lines of the French King, above, could be used for the press release.

When this French King, Charles VI, died in 1422, King Henry V’s son (Henry VI of England) did reign as King of France for 7 years. But then there was a hostile takeover by some French investors who installed Charles VII. Eventually, a white knight in the form of Joan of Arc helped Charles VII to complete the demerger of France and England.


Filed under Commercial negotiation

No royalties for trite infants’ rhyme

happy pay dayIP Draughts is a fool [/star].

IP Draughts is a fool [/star].

IP Draughts is moronic [/fantastic].

IP Draughts is a fool [/star].

Please don’t repeat these lyrics, in either version, or IP Draughts may be compelled to sue you for copyright infringement.

Or he may get his agent to demand $1,500 per use, depending on his mood.

It seems ridiculous that repeating the words of the song, Happy Birthday to You, could be an infringement of copyright, and require the payment of royalties to a well-known music publishing company. Yet that is what has been happening, apparently for decades, in the United States.

Yesterday, a court decision in California changed all that. The case has wrongly been described as deciding that the lyrics of this song are in the public domain. See, for example, this tweet from the Law Society of England and Wales today:


Unfortunately, the BBC (and therefore the Law Society) has it wrong. This case didn’t bring the Happy Birthday to You into the public domain. Rather, it said (among other things) that Warner/Chappell didn’t own the US copyright (if it existed) and therefore couldn’t sue people for copying the work.

Check the judge’s reasoning for yourself. The case is called Rupa Marya et al v Warner/Chappell Music, Inc, et al, Case No CV-13-4460–GHK (MRWx). It is a decision made by Chief United States District Judge King on September 22,2015 in the United States District Court for the Central District of California.

Judge King ‘bifurcated’ the trial, so we don’t yet know whether Warner/Chappell will be ordered to repay ‘millions of dollars of unlawful licensing fees’ as the plaintiff requested.




Filed under Intellectual Property

Who owns a Banksy mural?

art buffA recent case in the English High Court has seen a senior IP judge, Mr Justice Arnold, deciding on the ownership of a Banksy mural that was removed from the wall of a building.

The artist known as Banksy is famous for:

(a) retaining his anonymity;

(b) creating artwork in public places that could be viewed as graffiti, and sometimes has a political message, and which tends to have a high commercial value (hundreds of thousands of pounds); and

(c) causing his works suddenly to appear in unexpected places.

In recent years, a trend has developed of removing Banksy works from the walls on which they have been painted, and selling them at auction, sometimes to raise money for good causes.

The present case, The Creative Foundation v Dreamland Leisure Limited and others [2015] EWHC 2556 (Ch) concerns a mural known as Art Buff that appeared on the wall of a building in Folkestone, a seaside town in England.

art buff 2The tenants of the building, Dreamland Leisure, removed the mural, which involved taking a layer of the wall away, and sought to sell it at auction in the United States. The Creative Foundation sought an order for delivery up of the mural on the basis that it belonged to The Creative Foundation as assignee of the landlord’s interest.

In a case like this, we need to distinguish between the work of art, the copyright in the work, and the slice of wall on which it is painted. As Arnold J said in his judgment:

I should explain before proceeding further that, when I refer to the Mural in this judgment, I am generally referring both to the physical object and to the artistic work fixed on it. For the avoidance of doubt, I am not concerned with the copyright in the artistic work, which prima facie belongs to Banksy.

Thus, Arnold J found himself deciding a case on the respective rights of a landlord (lessor)  and a tenant (lessee) to materials that originally formed part of the demised premises but, when removed from the building, “revert to the status of chattels”. This is not part of the usual legal diet of an eminent IP judge.

After reviewing the cases, and the terms that could be implied into a lease of (real) property, he concluded:

In my judgment the term which is to be implied is that the chattel becomes the property of the Lessor. My reasons are as follows.

First, I consider that the default position is that every part of the property belongs to the Lessor. The Lessee only has a tenancy for a period of time. Thus it is for the Lessee show that it is proper to imply into the Lease a term which leads to a different result.

Secondly, in my view the mere fact that the Lessee is discharging its repairing obligation does not lead to the implication that it acquires ownership of such a chattel. Dreamland’s argument is based upon the Lessee’s need to be able to remove items generated by the act of repair from the premises. But that would only justify the implication of a term dealing with permission to remove (and, where appropriate, dispose of) such items. It does not justify the implication of a term transferring ownership of the items…

Thirdly, even if a term may be implied with respect to the ownership of (i) waste or (ii) chattels with no more than scrap or salvage value, it does not follow that it should be implied with respect to the ownership of a chattel with substantial value. Such a term would not be necessary, would not go without saying and would not be one that would satisfy the officious bystander test.

Fourthly, I do not consider that it makes any difference that the value is attributable to the spontaneous actions of a third party. It is fair to say that, whatever solution is adopted, one party gets a windfall. But who has the better right to that windfall? In my view it is the Lessor. …

Accordingly, I conclude that the Foundation is correct that the defence advanced in paragraph 13 of the Defence is unsustainable as a matter of law.

For the reasons given above, I conclude that the Foundation is entitled to summary judgment on its claim against Dreamland for delivery up of the Mural.

So, now we know. Though one might have expected copyright law to feature prominently in a dispute over a valuable artwork, in fact it came down to implying terms about the ownership of builders’ rubble in a routine property lease. IP Draughts wonders whether the drafters of property leases will, in future, include standard terms to deal with the ownership of works of art that are incorporated into the leased property without the knowledge or permission of either lessor or lessee.

The back story to this dispute is also interesting. It seems that Art Buff failed to sell at auction in the USA because its authenticity as a Banksy work had not been certified by a body associated with Banksy, known as Pest Control. Thus, questions of property law and copyright law were ultimately secondary to questions of provenance.





Filed under General Commercial, Intellectual Property, Legal Updates