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.