Category Archives: Intellectual Property

International IP transactions and the effect of local laws

Litigating IP rights is such tiring work!

Litigating IP rights is such tiring work!

You have entered into an IP agreement that applies worldwide. It might be a licence agreement in which the licensed territory is all countries of the world. Or it might be an assignment of all of your IP, in all countries of the world.

The parties have agreed the law and jurisdiction of the contract. For present purposes, let us say that English law is to govern it, and that the English courts have exclusive jurisdiction. But the issues mentioned below are likely to apply irrespective of which law and jurisdiction are chosen.

The contract addresses IP-related issues in each country of the world. Take the example of an exclusive licence agreement that includes a term stating that the licensee can sub-license its rights. To what extent will this term override provisions of national IP law that state whether a licensee is permittee to sub-license?

As far as IP Draughts is aware (but he hasn’t done any worldwide research), on this point national IP laws may provide a fall-back position if the contract is non-specific on the issue, but they tend not to be prescriptive in the sense of overriding what the parties have agreed. For example, section 30(4)(a) of the UK Patents Act 1977 provides:

to the extent that the licence so provides, a sub-licence may be granted under any such licence and any such licence or sub-licence may be assigned or mortgaged

This suggests that, in the absence of a provision in the head licence agreement that permits sub-licensing, sub-licensing is not allowed.

Some years ago, when we wrote our loose-leaf work on agreements in the pharmaceutical sector, our German-law contributor included the following comment as a footnote in the licence agreement template:

Under German law, the right to grant sub-licences in case of an exclusive licence follows by law. Thus the parties need to explicitly exclude such right if desired.

IP Draughts suspects that, in most cases, national IP laws on the interpretation of an IP agreement will not override terms that the parties have expressly agreed in their contract.

If we broaden the subject from IP laws affecting the interpretation of IP agreements, to IP laws more generally, can we still assume that the terms of the contract override national IP laws? Probably not. For example, an IP agreement made under English law might state that the licensee can sue infringers. National IP laws may not allow the licensee to bring an action in its own name. Should the agreement be interpreted as requiring the IP owner to sue an infringer on behalf of the licensee in those countries where a licensee lacks locus standi to sue in its own name? IP Draughts cannot offer any universal answer to this question. It may depend on how the court interprets the contract. And even if the English court (in the above example) says that the answer to this question is yes, how enforceable will this decision be in the jurisdiction where the action is to be brought?

lex luthor

lex luthor

This type of question has long troubled IP Draughts, and he regrets that he didn’t take a course in conflict of laws at university. When, occasionally, he scratches the surface of this subject, he sees the liberal use of Latin expressions such as lex situs and lex fori, realises how dry and complicated the subject is, and leaves detailed study for another day. Even apparently helpful documents that seem to be directly on point, such as this one, cause him mild panic.

It was with mixed feelings, therefore, that IP Draughts read last week’s judgment by Arnold J in the case of Gloucester Place Music Ltd v Le Bon & Ors [2016] EWHC 3091 (Ch) (02 December 2016).

Readers may have seen reports in the national press about this case, and the dissatisfaction of the defendants with the outcome. Boiling it down to its essentials:

  1. The defendants are the members of the 1980s pop group, Duran Duran, and their service companies.
  2. In the 1980s they made an outright assignment of the worldwide IP in their songs to the claimant, a UK company, in return for payments including royalties. The agreements were all made under English law and were subject to the jurisdiction of the English courts.
  3. The assignment was very broad in scope (and used excruciating language, but that is a discussion for another day).
  4. US copyright law (section 203 of the US Copyright Act 1976) allows authors who have assigned their copyright to reclaim it after, typically, 35 years, by serving notice on the assignee. Section 203(5) provides: “Termination of the [assignment] may be effected notwithstanding any agreement to the contrary…”
  5. The defendants have served notices under section 203 on the claimant.
  6. The claimant sought and won a declaration in the English High Court that by serving such notices the defendants are in breach of their contracts with the claimant under which the IP was originally assigned.

The judge managed to use another Latin expression from the conflict-of-laws dictionary, namely lex loci protectionis. Applying English law principles of interpretation he concluded, “not without hesitation”, that he should give effect to the assignment as written, and should not make it subject to the rights given to authors by US copyright law to claim, in effect, a reversionary interest in the copyright.

This brief report omits mention of a number of other issues that the judge considered, including the fact that neither party provided expert evidence from a US lawyer.

IP Draughts hopes that this dispute will be appealed to the UK Supreme Court, so that we can get some guidance from Lord Neuberger and his colleagues on the interplay of national IP laws and IP contracts made under another law. Dare he say it aloud, but he would find this a far more interesting subject on which to get the Supreme Court’s ruling than whether the Prime Minister is required to introduce a Parliamentary Bill (which will almost certainly be approved by the House of Commons) before giving notice under Article 50 to leave the European Union.

 

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Leading UK licensing lawyers 2017

leaguesFor several years, this blog has produced a table of leading IP licensing lawyers, created by the simple but imperfect method of identifying all the lawyers who are recommended in both of the following directories for that year:

(a) the IAM Patent 1000 list of leading UK patent licensing lawyers; and

(b) the Chambers Directory list of leading UK transactional lawyers in the field of life sciences.

The latter list  was published earlier today; the IAM list was published some months ago.

So, who is on the IP Draughts list for 2017? Drum roll…

Laura Anderson  Bristows LLP
Mark Anderson  Anderson Law LLP
Malcolm Bates  Taylor Wessing LLP
Alison Dennis  Fieldfisher LLP
Patrick Duxbury  Gowling WLG
Jim Ford  Allen & Overy LLP
Michael Gavey  Simmons & Simmons LLP
Mark A Lubbock  Ashurst LLP
Nicola Maguire  Cooley LLP
Lucinda Osborne  Covington & Burling LLP
Daniel Pavin  Covington & Burling LLP
Stephen Reese  Olswang LLP
Chris Shelley  Penningtons Manches LLP
Sally Shorthose  Bird & Bird LLP
John Wilkinson  Cooley LLP

 

Most of the names on this list have been on the list for several years. A few names have dropped off but there are no new names. As a result, there are 15 names on the above list compared to 20 last year.

vennAn advantage of this list over the Chambers Directory list is that this list omits some individuals who are really corporate lawyers rather than IP lawyers. A disadvantage of this list is that it omits some fine IP lawyers who are not particularly focused on life science work, eg Matthew Warren of Bristows, or who are up-and-coming (eg IP Draughts’ partner Lisa Allebone, who has been named in the IP section of Chambers Directory for the first time).

Despite these defects, the list continues to be a fairly good indicator of the leading technology licensing lawyers in England and Wales.

Congratulation to all who appear!

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Impressions of Parliament

traitors-gateLast week, IP Draughts (together with his colleagues Matthew Harris and Vicki Salmon) gave oral evidence to a House of Lords Public Bill Committee. Details of that event can be found in the previous posting on this blog.

There is more work to do, as the committee has asked us to provide written comments on all the drafting proposals on the Intellectual Property (Unjustified Threats) Bill that have been made by others, as well as deal with some further questions that members of the committee have raised. We need to get those comments in by Wednesday evening, to meet a formal closing date for submissions.

Rather than focus on the substance of the Bill, this posting will give IP Draughts’ impressions of appearing as a witness in Parliament.

The only other Parliament that IP Draughts has spent time in is the New Zealand one, which he had a guided tour of, last year. By comparison the UK one is much larger. We came in through the ancient Westminster Hall, in which Henry VIII held his coronation banquet, and in which Sir (later St) Thomas More, Guy Fawkes and Charles I were (at different times) tried and sentenced to death.

corridorCommittee Room 2 of the UK Parliament is at the end of a long corridor of committee rooms, most of which seemed to be in use when we were there. There were crowds of people outside some of the rooms, and large TV screens listing the day’s events. Fortunately, we had an experienced guide in the form of Law Society public affairs representative (and KCL law graduate), Iana Vidal, so we didn’t need to worry about finding our way.

Waiting outside our committee room, IP Draughts was pleasantly surprised to meet some of the committee members. The chairman, Lord Saville, made a point of coming out and briefly chatting to the three of us who were due to give evidence. Iana told us this was rare, in her experience of Parliamentary committees. After the hearing, we again spoke to some of the committee members.

Some readers may have seen Parliamentary committees on television, and perhaps may have noticed that some hearings are held in plain rooms with modern furniture and abstract art on the walls, while others are in traditional Victorian rooms with wood panelling. Our committee room (and, IP Draughts assumes, all of the committee rooms nearby) was of the latter kind.

Committee room 4, rather than 2, but similar in style

Committee room 4, rather than 2, but they are similar in style

IP Draughts was struck by how intimate the space felt, compared with how it looks on TV. It was well lit, both by electric lights and by leaded windows that overlooked a grey River Thames. It felt well-designed for its purpose, and more conducive to discussion than many court rooms.

The members of the committee have a variety of backgrounds, but are all of mature years. As well as a patent attorney, in the form of Baroness Bowles, there was a current IP Minister, Baroness Neville-Rolfe, and a former IP Minister, Baroness Wilcox. The chairman, Lord Saville, is a retired Supreme Court justice. Lord Plant, who spoke briefly, is a professor of jurisprudence and political philosophy, though his interests seem to lie more on the philosophy side than on law. Other members of the committee seemed to have had less direct involvement with IP or the law, though Lord Lucas clearly has some direct experience of IP threats and how they were dealt with by the regulatory authorities.

The hearing itself was, overall, interesting and stimulating. At first, IP Draughts found it difficult; later he started to enjoy it. Their lordships weren’t trying to catch us out, or belittle us, and seemed genuinely interested in our replies.

The tone of the proceedings was polite, conversational, and yet concise and focussed. Reading back through the transcript, IP Draughts felt that both grillers and grillees mostly kept  to the topic at hand. He has learnt a little about the skills of political debate, or at least the polite version that is conducted in the House of Lords.

 

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IP threats in the House of Lords

hl-committeeThis weekend, IP Draughts has a note from the school doctor: he is excused long runs, contact sports or blogging. He has to prepare for what may be a once-in-a-lifetime event, namely appearing as a witness before a House of Lords committee next Monday afternoon.

The committee is known as a Public Bill Committee, and has been convened as part of the passage of the Intellectual Property (Unjustified Threats) Bill through Parliament. It is chaired by Lord Saville, a retired Supreme Court justice. Previous witnesses to have appeared before this committee include Baroness Neville-Rolfe, the IP Minister, Sir Robin Jacob and Sir Colin Birss.

The committee hearing, which will be taking place on Monday 24 October at about 3.30 pm, is recorded on camera, live-streamed and saved on the UK Parliament website, so if you are a glutton for legal minutiae feel free to stop by. Details of the hearing can be found on the Parliament website here. IP Draughts believes the streaming will be accessible here.

IP Draughts will be giving oral evidence as chairman of the Law Society’s Intellectual Property Law Committee. Also giving evidence will be fellow IPLC member, Matthew Harris, and Vicki Salmon, representing the Chartered Institute of Patent Attorneys.

Now IP Draughts has to do some homework, and prepare for some difficult questions from Baroness Bowles, who is a member of the committee and a patent attorney, possibly the only patent attorney in Parliament.

 

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