Inteo is a Belgian law firm focused on intellectual property and related practice areas. The IP Report reports on noteworthy developments and court decisions relevant to intellectual property and technology law in Belgium and the EU.Read more
Inteo is a Belgian law firm focused on intellectual property and related practice areas. This newsletter reports on noteworthy developments and court decisions relevant to intellectual property and technology law in Belgium and the EU.
Patents – obviousness - problem-solution approach not mandatory – In a judgment issued on 22 March 2018, the Belgian Cour de Cassation rejected a point-of-law appeal against the revocation of Roquette Freres’ European patent for crystals of maltitol of a particular form. The Ghent court of appeal decided that the invention was obvious in view of two prior art publications and the common general knowledge. The patentee’s defence was based on the problem solution approach. That approach reflects the way the European Patent Office (EPO) typically addresses obviousness. Belgian courts have often sought guidance in EPO practice (including the problem solution approach) for the assessment of patent validity.
In its point-of-law appeal, Roquette Freres raised a plea that the court of appeal violated its duty to state reasons pursuant to Article 149 of the Constitution. It essentially argued that the court of appeal had a duty to individually address its defence based on the problem solution approach. The Cour de Cassation dismissed that plea. It found that the court of appeal properly motivated its decision on obviousness. The patentee’s arguments based on the problem solution approach were, according to the court, “not a separate plea in law, but only an argument to support its plea on the presence of an inventive step”. This judgment supports the view that, while the problem solution approach can be a helpful tool, it is not the only way to establish that an invention was obvious to the person skilled in the art.
Trade marks – acquired distinctiveness – geographical requirement - In its judgments of 25 July 2018 (joined cases C-84/17 P, C-85/17 P and C-95/17 P, KitKat) and of 6 September 2018 (C-547/17 P, Basic Net), the Court of Justice of the European Union quashed hopes that evidence of acquired distinctiveness in a significant part of the territory of the European Union suffices to overcome an ab initio or inherent lack of distinctiveness of EU trade marks.
Both cases related to a trade mark that was found to be ab initio devoid of distinctive character across all EU Member States. Article 7(3) EUTMR provides that such a trade mark can overcome the absolute ground for refusal if it has become distinctive because of the use that has been made of it. In KitKat, Nestlé argued that to meet this threshold, it was enough to show that a significant proportion of the relevant public in the European Union perceived its 3D trade mark as an indicator of origin. It relied inter alia on the CJEU’s judgment in Leno Merken (C-149/11) wherein that standard is applied to the requirement of genuine use of a trade mark.
The CJEU rejects that stance. It explains that the territorial requirement of genuine use cannot be applied by analogy to that of acquired distinctiveness. The Court accepts that evidence for every individual Member State may not be necessary in all cases. It goes on to clarify that although proof of acquired distinctiveness “may be produced globally for all the Member States concerned or separately for different Member States or groups of Member States, it is not, however, sufficient that the party with the burden of providing such evidence merely produces evidence of such acquisition that does not cover part of the European Union, even a part consisting of only one Member State.” Because Nestlé had not established distinctiveness in Belgium, Ireland, Greece and Portugal, it failed to satisfy the requirement of Article 7(3) EUTMR.
In its subsequent judgment of 6 September 2018, the CJEU confirmed its position for a colour combination trade mark applied for by the Italian company Basic Net. It is perhaps not a coincidence that the trade marks at issue were a 3D mark and a colour mark. For these type of trade marks, inherent distinctiveness is accepted only in exceptional circumstances. The KitKat and Basic Net judgments confirm that establishing acquired distinctiveness for EU trade marks can be a very tall order.
Software copyright – functionality – graphical user interface – In a judgment issued on 13 June 2018, the President of the Antwerp commercial court provides guidance on the limits of copyright protection for software. ERA is a network of real estate agents. The Brokery had developed a CRM application for some of the agents in the network. It argued that ERA infringed its copyrights in that software, alleging that an application developed by ERA was a copy. The Court dismissed the action.
The reasons of the decision start from the principle laid down in SAS Institute v World Programming (C-406/10) that software copyright protection does not extend to the functionality of a computer program because that would allow the monopolization of ideas. It only covers (original) object and source code, as well as its architecture. The Court clarifies that that architecture must be seen at code-level, in that it comprises the (structure of the) instructions and commands performed. Because the allegedly infringing software was coded in a different programming language and the claimant had not even performed a comparison at code-level, the claim based on software copyright was dismissed. The Brokery also invoked copyright in the graphical user interface (GUI) of its application. The Antwerp court follows the CJEU’s decision in BSA (C-393/09) that a GUI is not subject to copyright protection for computer programs. As in BSA, the Court accepted that a GUI could qualify for protection under ordinary copyright, provided it is established that it meets the criterion of originality. The Brokery asserted that an input screen of its application was original. The court disagreed and held that the structure of the screen was entirely dictated by logic and the input required.
Copyright – collecting societies – abuse of dominant position – In a judgment issued on 12 April 2018, the President of the Brussels commercial court held that Belgian collecting society SABAM had abused its dominant position by unilaterally increasing tariffs for music festivals. SABAM is the Belgian association of authors, composers and publishers. It charges music festival organisers a percentage of ticket sales for the use of its music repertoire.
In January 2017, SABAM increased tariffs for music festivals by up to 37%. 32 music festivals and the federation of music festivals in Flanders initiated injunction proceedings, asserting that the increase amounts to excessive pricing. It was not in dispute that SABAM holds a dominant position as the de facto monopolist for collective rights management for Belgian music festivals. The Court decides that there was no objective justification for the increase of the tariffs. SABAM’s defense was that the increase was made after benchmarking tariffs in neighbouring jurisdictions. The Court did not accept this, inter alia because it would allow for a vicious circle of increases across jurisdictions. The Court further held that SABAM is required to adjust its royalty basis for costs incurred by the festivals that have no bearing on the use of music. Finally, SABAM’s tariffs must take into account how much of the music played at a given festival belongs to its repertoire, for example by using DJ monitoring technologies or playlists. We were informed an appeal against this judgment is pending.
Trade marks – repackaging – pharmaceuticals – generic products – On 12 April 2018, the President of the Brussels commercial court also issued an injunction against the sales of repackaged pharmaceutical products that were imported from the Netherlands. Sandoz is a member of the Novartis group. It markets a generic version of Novartis’ Femara® product (letrozole) in the Netherlands under the Sandoz brand. Impexeco, a parallel importer, had repackaged the generic product using the Femara® brand for sales in Belgium.
The Court held that because the products were sold under the Sandoz trade mark, Novartis’ rights in the Femara® trade mark had not been exhausted. The Court did not accept Impexeco’s defense that the Femara® trade mark is used to artificially partition markets. Novartis succeeded in establishing that the market segments for generic and originator letrozole products are clearly distinct. According to the decision, it does not matter that Sandoz’s product is identical to Femara®. Nor is it relevant that they are marketed by the same corporate group.
Contact - For more information about the topics covered in this newsletter, please contact our lawyers Kristof Neefs or Sofie Cubitt.
The Inteo IP Report is a newsletter reporting on noteworthy developments in Belgian and EU intellectual property law. To receive these updates by e-mail, you can subscribe here.
Trade marks – applications made in bad faith – In its judgment of 16 May 2017 in case T-107/16, the EU General Court annulled a decision by the EUIPO Board of Appeal. The Board of Appeal had dismissed an invalidity action on the basis that the composite mark ‘AIR HOLE FACE MASKS’ was filed in bad faith. The case is noteworthy because the trade mark application was filed by an EU distributor of the products concerned. The manufacturer sought the invalidity of the mark, asserting that it was filed in bad faith because the distributor did not have the right to file a trade mark in its own name. The General Court’s judgment explains that the considerations in the CJEU’s judgment in Lindt & Sprüngli are only examples drawn from a number of factors that can be taken into account to determine whether a trade mark application was filed in bad faith. After an assesment of all circumstances of the case (including correspondence between the parties, earlier trade mark registrations by the manufacturer in the US and Canada and the terms of the distribution agreement) the General Court decided that the trade mark had been applied for in bad faith.
Patents – As was reported in the Inteo patent law update in April, the Mons Court of Appeal has issued guidance on the effect of res iudicata (claim preclusion) on a second invalidity action by the same claimant against the same patentee. After an invalidity defence directed to a patent for a liposuction device had been dismissed in a final decision, the court allowed, in a judgment issued on 3 April 2017, a new invalidity action on legal grounds that had not been relied on in the previous action (added subject matter). However, the court declared the invalidity action inadmissible to the extent that it relied on the same legal grounds as the earlier action (obviousness, lack of novelty). The fact that the obviousness claim was supported by new evidence, i.e. prior art documents that had not been used in the earlier proceedings, was not enough to allow a new action in this respect.
Internet intermediaries – ISP and subscriber information – In a decision of 19 January 2017, the Antwerp commercial court ordered internet service provider Telenet to disclose the identity of two of its subscribers to Siemens PLM. The subscribers in question had tried to activate an unlicensed copy of Siemens product life-cycle management software. Siemens relied on the right to information that rightsholders enjoy in accordance with Article 8 of the IP Enforcement Directive. Telenet was ordered to disclose the identity of its subscribers only if the subscribers were commercial undertakings. The court ordered Siemens to pay 160 EUR to cover Telenet’s costs of compliance with the order.
Copyright – CJEU reference on copyright in flavours: In the Netherlands, the Court of Appeal of Arnhem-Leeuwaarden has issued a reference for a preliminary ruling to the EU Court of Justice on 23 May 2017. The referring court asks whether copyright can be claimed in a taste and, if it can, what conditions apply. The case relates to the taste of a popular cheese product (Heksenkaas). The referral contains specific questions, inter alia whether the instability of the food product and the subjective sensory experience play a role and – if claiming copyright in flavours (or ‘sensory copyright’) is accepted in principle – how the rightholder would have to establish originality and infringement. It is expected this matter will draw some attention, as its outcome will likely be relevant for perfumes and other luxury products as well.
Designs – indirect comparison – On 14 March 2017, the Brussels Court of Appeal decided that Vasco Group’s registered Community design for heating radiators was infringed by Quinn Group. The validity of the design was not in dispute. In its infringement assessment, the court found that minor differences between the products and the registered design do not lead to a different overall impression for the informed user. The court takes into account that the designer of such products enjoys a substantial degree of freedom. The infringement assessment was made on the basis of an indirect method of comparison based on an imperfect recollection of the designs. The court notes, in that regard, that a direct comparison of heating radiators will not always be possible for the informed user.
Recovery of legal costs – On 8 May 2017, the Antwerp Court of Appeal issued a long-awaited judgment in another case involving Telenet, after a preliminary ruling by the EU Court of Justice. As the prevailing party in a patent infringement case against Rovi, Telenet claimed lawyers’ fees in excess of the statutory maximum that applies in Belgium. The CJEU had ruled in C-57/15 that a flat-rate scheme for the recovery of lawyers’ fees is irreconcilable with Article 14 of the IP Enforcement Directive if the cap is too low to allow the prevailing party to recover at least a significant and appropriate part of reasonable costs. The Court of Appeal rejected Telenet’s claim for lawyers’ fees beyond the statutory maximum in the main proceedings because – even if it were to accept that the Belgian statutory maximum is in fact too low – it could not adversely affect Rovi’s legal position by means of a contra legem interpretation of national law. In contrast, Rovi was ordered to pay the fees of Telenet’s technical counsel.
Contact - For more information about the topics covered in this newsletter, please contact our lawyers Kristof Neefs (firstname.lastname@example.org / +32476900364) or Sofie Cubitt (email@example.com / +32479735776).
The Inteo IP Report is a newsletter reporting on noteworthy developments in Belgian and EU intellectual property law. To receive these updates by e-mail, you can subscribe here.
Patents - preliminary injunctions & the requirement of urgency – On 21 February 2017, the Brussels Court of Appeal issued a judgment in preliminary injunction proceedings between medical imaging company Guerbet and Bayer (2016/KR/18). Guerbet sought a preliminary injunction to prevent the marketing of a generic version of its product, a contrast agent, on the basis of a European patent for a process for preparing such agent. The court denied Guerbet’s appeal against the first instance dismissal because the requirement of urgency to obtain a preliminary injunction in Article 584 of the Belgian Judicial Code was no longer met. This requirement entails inter alia that regular proceedings cannot provide timely relief for the party seeking a preliminary injunction. This implies that the claimant must act diligently and without delay to obtain relief in a main action. While Guerbet was aware of the alleged patent infringement since at least January 2016 and it had sought interim relief both in preliminary injunction proceedings and a saisie-contrefaçon, it had not followed up on these actions by initiating main proceedings. Such proceedings had still not been filed on the trial date for the appeal in the preliminary injunction proceedings in late October 2016. In result, the Court of Appeal dismissed the action because it no longer met the statutory requirement of urgency. The Court also held that the action by the co-claimant, the local subsidiary of Guerbet and the holder of a non-exclusive licence that was not notified to the Belgian patent office, was inadmissible.
Copyright – On 17 February 2017, the Cour de Cassation dismissed a point-of-law appeal against a judgment of the Ghent Court of Appeal in Longchamp / Calem (C.15.0144.N). Longchamp unsuccessfully sought an injunction against a handbag marketed by Calem on the basis of its copyright in the classic Le Pliage bag. The Cour de Cassation confirmed the appeal court’s finding that a combination of design features in a handbag that corresponds to a fashion trend is not, as such, a work eligible for copyright protection. Since the subject matter claimed was, according to the court, not a work eligible for protection, the originality test did not need to be applied to dismiss the infringement action. It is worth noting that the Ghent Court of Appeal’s judgment had been the subject of substantial criticism in legal doctrine, not in the least because the Brussels Court of Appeal had confirmed in several decisions that the Le Pliage bag was protected by copyright.
Trade marks & debranding – The Brussels Court of Appeal issued a reference for a preliminary ruling to the EU Court of Justice (CJEU) in Mitsubishi / Duma Forklifts (2010/AR/2007) on 7 February 2017. In a lengthy judgment, the Court of Appeal awarded substantial provisional damages for trade mark infringement by importing and marketing Mitsubishi forklifts originating from outside the European Economic Area. In relation to a batch of such forklifts, Duma argued that there was no trade mark infringement because it had removed all Mitsubishi trade marks and serial numbers from the products prior to clearing them in the EEA. The Court of Appeal decided to ask the CJEU whether the trade mark owner is entitled to oppose debranding of products that were not put into circulation in the EEA and whether it is relevant that the products are then marketed in the EEA under the third party’s own trade mark (rebranding). The referral also asks the CJEU to consider the relevancy of the fact that the average consumer could still identify the commercial origin of the products on the basis of their appearance or design.
Design rights & copyright – On 17 January 2017, the President of the Brussels Commercial Court (Dutch language division) issued an injunction against the claimant in Neoz / Imagilights (A/16/03552). Neoz sought an injunction against Imagilights on the basis of registered Community designs (RCD) for cordless table lamps. The claim became a boomerang. The defendant relied upon documents establishing that its own product designs predated the RCDs, counterclaiming for invalidity of the designs and an injunction on the basis of its earlier copyrights in the product design. The court revoked the designs on the basis of Article 25, 1), f) of Regulation (EC) No 6/2002 on Community Designs, providing that a design can be declared invalid if it constitutes an unauthorized use of a work protected under the copyright law of a Member State. The court did not accept the claimant’s defense that its own designs had been independently created, noting that there is no such exception in Article 25, 1), f) and that Neoz failed to establish its own original creation in view of the striking similarities between the designs. Neoz did not provide any information in regard to its own design process. The defendant also disclosed its designs on trade fairs before the application date of the RCDs, making Neoz’s statement that it could not have known of those designs implausible in the eyes of the court.
Domain names - In ADR proceedings under Section 10 of the Terms and conditions of DNS.be (the .be registry operator), the third party decider rejected a complaint to obtain the transfer of the domain name kingsize.be (Case No 44415). One of the 3 requirements to obtain the transfer of a .be domain name is that it was either registered or is being used in bad faith. Kingsize.be was registered by a domainer almost a year before the complainant was incorporated under the name Kingsize. The complainant offered to purchase the domain name for 500 EUR, to which the holder made a counteroffer of 4.900 EUR. An offer to sell a domain name at a high price can be, and often is, evidence of use in bad faith. In this particular case, the third party decider was not convinced. The decision notes that the domain name is a generic term in the English language and that it was registered prior to the complainant's use of the name. Because the domain name holder did not initiate the contact regarding the sale and no other evidence of bad faith was put forward by the complainant, his asking for a higher price was not sufficient to establish bad faith in this case.