Insight on Patenting Open Source Software

Nowadays, many individual inventor(s) and small enterprises approach us with a query – whether their innovation in an open source software can be a subject matter for a patent. If yes, then how? Primarily, the inventors would like to understand how much of their contribution in the underlying software is protected, as much of the software is built on existing program code developed by the open source community. To answer the questions, I thought it is best to discuss in a post to provide details to the inventors in general. In this post, I intend to discuss only patents and not copyright.

As known, open-source software refers to a software for which the underlying programming code is made freely available for use, reading the code, changing it or developing further versions of the software, including adding amendments to it. Open source software is often used as a non-proprietary software, such as Android, Linux, Ubuntu, Mozilla, GNU, etc., in which different versions of the software is further distributed and licenced at no additional cost. In other words, open source software is made available to the general public with relaxed or no intellectual property restraints that would keep another person from customizing or building upon the source code to make use of the software for their particular use. On the other hand, proprietary software, such as iOS, Windows, MacAfee, maintains the exclusive rights in terms of copyright and/or patents. The exclusive rights allow the owners of the proprietary software to refuse access to the source code by third parties for the purpose of copying or modifying the software, or sometimes controlling the use of the source code.

As the open source software is freely available for to use, a user can obtain the software from multiple third party sources under the open source license. Further, the user can modify the software to distribute or sell the software for profit. In the process, if the user modifies the software to attain certain functionality in an application, then the open source license does not stop the user from obtaining patent protection on inventive aspects of his modification to the software. However, the uses to which patent rights can be put are reduced when software embodying the patented technology is distributed under the open source license.

Now that I mentioned patent rights are reduced, one may ask that a patent owner has the right to exclude others from making, using and selling his patented invention. That is true, but not when the patents are obtained for the inventions on open source software. This is because; the open source license such as Mozilla Public License, GNU General Public License (GPL), and the like forbids imposing any restriction whatsoever on the rights granted by the license to the recipients of the software. Therefore, the patent owner who distributes a software incorporating his patent can no longer assert that patent against people who distribute that package further or incorporate the package in their own product. In other words, the rights obtained from open source license restricts the patent owner to assert the patent rights later on. This means that a competitor will have freedom to incorporate that package in his own product without having to pay any royalty to the patent owner. Please keep in mind that the part of the package in the product will have to be made available under the open source license.

Having said that, the follow-up question would be- why would anyone want to obtain a patent on an invention that is going to be distributed under the open source license? Actually, there are many reasons to do so. I will list down couple of them.

First, the patent owner wishes to license the patent to others to produce a revenue stream.

Second, the patent owner wishes to assert his patent rights against redistributors who do not conform to the open source license terms.

Third, the patent owner wishes to use the patent rights as an offensive or defensive weapon against infringers who are not using the open source license. For instance, the patent owner can assert the patent rights against his competitor who sells a competing product that incorporates the invention using proprietary software.

Many companies have had the above reasons to patent open source software and further distribute them. For example, Sun and IBM have patented thousands of open source software patents, only to release them to the general public. Sun patented its open source software so that it could release the open source software under its own open source license.  IBM regularly patents its open source software to have patent rights to use as an offensive or defensive weapon against claims that it is infringing on someone else’s intellectual property rights. In recent times, Google is aggressively pursuing to patent many applications built on the Android platform and license them for free.

It should be apparent that an open source software user is clear of patent infringement claims from the (same) open source licensee. However, the chance that a particular open source software package infringes on a patent by a proprietary software owner is quite real. In such cases, the open source software user may utilize couple of options to protect themselves. First, the open source software user may defend himself from the allegations of patent infringement. Second, the open source software user may request the open source license community and use their pool of patents on the technology to defend themselves. If nothing works, the open source software user may have to take a patent license from the proprietary software owner.

Using open source software has various advantages and risks. Use of open source software reduces cost and development time, or avoids being dependent on a single source. In order to reduce the risks, the license conditions of all open source software should be carefully evaluated. Further, the open source software should be screened for patent risks before use and/or distribution.

Author, Chandrasekhar is Manager and Patent Agent at IP Astra

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Protection of Architectural Works

“Architecture is not based on concrete and steel and the elements of the soil. It’s based on wonder.”  Daniel Libeskind

Recently, a few friends and I were having an interesting discussion the changing skylines of several countries – how things were, are and were likely to be. The talking point of the discussion was the novelty and ingenuity of architectural design unique to certain countries. For instance, the ancient pyramids of Egypt, the imperial palaces of the Ming dynasty, the architectural genius of Charles Correa whose modern designs are an integral part of India’s architectural history – all the design and its three dimensional interpretations were works of art. The imagination, time, effort, and resources required by architects in all these cases are astounding. Now, all this admiration made us wonder whether architects could protect their “works of art” from infringement, or from “copycats”? We delved into details to understand the law. After delving the details, the answer, hands down is a big yes. With this post, we thought to throw some light on how the structure of an architectural design can be protected.

As we all are aware, different countries have different laws. Generally, copyrights and trademarks are registered for safeguarding the interests of the architect/designer. These laws acknowledge the significant time, effort and money spent by architects. This article provides a general and basic idea of the laws enacted in the United States of America and India for the protection of artistic works of art.

For the sake of general understanding, an “architectural work” is a design exemplified in any tangible medium of expression, including a building, architectural plans, or drawings. Architectural works in the material form such as buildings are perceived as cultural symbols, functional spaces and as works of art. Like anything in its nascent stage, the protection of architectural works is an issue that has not been understood and discussed enough. A large number of architects or designers are unaware of how to protect their building designs. The procedure of protecting works of art in the United States of America is different from the procedure followed in India.

So, how does Uncle Sam protect the designs or architectural works of architects? Basically, architects in the US protect their designs and the 3D manifestation of the design by registering the respective as copyrights. In the year 1909, the US congress enacted The Copyright Act of 1909. The 1909 act did not specifically mention architectural drawings or construction drawings, but copyright protection for “drawings or plastic works of a scientific or technical nature” was included. With the language, the Federal Court assumed that it meant architectural blueprint. Later, in 1976 the US Congress felt the need to specifically include architectural plans and drawings. The act is commonly referred to as the 1976 Act. However, the courts held that even the 1976 Act failed to protect the architectures right to build structures as depicted in the drawings.

In 1989, amidst all this confusion regarding protection of architectural works, the US joined the Berne convention for the Protection of Literary and Artistic Works. The Berne convention requires that its signatories provide the required protection for original architectural designs. At this point, the US congress sensed the urgency for a law that provides complete protection of architectural works, in both plans as well as 3D manifestation. On December 1, 1990, President George H.W. Bush signed the Architectural Works Copyright Protection Act (AWCPA) into law. According to the AWCPA, the list of copyrightable subject matter was extended to include architectural works under 17 U.S.C. § 102. The act provided a 2 tier level of protection for architects. Under 17 U.S.C. § 102(a)(5), the architect is able to protect the pictorial, graphic, and sculptural works. And under 17 U.S.C. § 102(a)(8), the architect is able to protect the design of the architectural work as embodied in the architectural plans.

In order to receive copyright protection of the architectural work, the architect should be able to comply with the requirements of “originality” despite the fact that the fundamental elements of architectural design exist in the public domain. Now, in case of copyright infringement, the district court conducts a two part test. The first part of the test takes account of the validity of the copyright at issue. Certificate of registration of the copyright is the prima facie evidence of the validity of the copyright in question. An unsaid yet understood rule is that the architectural work must exhibit creativity to be protected under AWCPA. The second part of the two part test is evaluating the copyright under a “substantial similarity” analysis. Based on the evaluation, the examiner has to evaluate whether the alleged infringer has access to the original architect’s work.

The United States also allows architects to register architectural works as trademarks under the Lanham Act. According to § 1301.02(c), “The three dimensional configuration of a building is registerable as service mark only if it is used in such a way that it is or could perceived as a mark”. On most occasions, a photograph is a proper specimen of use for a three dimensional mark. However, photographs of a building fails in showing use of the architectural design as a mark for services performed in the building by only showing the architectural structure in which the services are performed.  The specimen must show that the proposed mark is used in a way that would be perceived as a mark.

While this is how it works in America, India is a different case. Indian law provides protection to the architectural works under the uniform copyright law. The copyright law in India is governed by the Copyright Act of 1957 amended in 2012, and the Copyright Rules, 2013. The section 13 of the Copyright Act, 1957 enumerates original, literary, dramatic, musical, and artistic work, cinematographic films and sound recordings as eligible for copyright protection. The section 13 of the Copyright Act, 1957 states that, “In the case of work of architecture, copyright shall subsist only in the artistic character and design and shall not extend to process or methods of construction”.

Another significant point is that India is a signatory of the Berne’s convention of 1886, as well as the Universal Copyright Convention of 1951. By signing the conventions, an artist gets  protection for the architectural works (or for the matter of fact any literary and other artistic works) registered in other member countries to accord protection in India and vice versa.

To conclude, governments around the world are ready to recognize and protect artistic works. Failure to take steps in securing artistic works under intellectual property available in the respective countries would leave the architect with no legal remedy to claim his/her right over the architectural design or structure. In this highly competitive and frenetic world, ignorance is not ever going to be considered bliss.

The author, Perzeus Abhas, is a Patent Engineer at IP Astra

Self-driving cars- Would they be safe?

In 1964, Isaac Asimov wrote an essay in the New York Times expatiating his predictions for the year 2014. Although he did make a few duds, – he had predicted that we would have lunar colonies by now- one of the most accurate predictions he had made in the essay is summarized in the following excerpt:

“Much effort will be put into the designing of vehicles with ‘robot-brains’—vehicles that can be set for particular destinations and that will then proceed there without interference by the slow reflexes of a human driver.”

Yes, the author, well known for his clairvoyance, had predicted our endeavour to build the self-driving cars – the one technology that is apparently Google’s solution for Utopia.

The recent years have seen companies like Google, Nissan, and Daimler Chrysler hiring the best minds in the market for building the first perfect, fully autonomous car. Admittedly, they have made some rapid strides too. Nissan has become gutsy enough to announce that it will get in the autonomous car business by 2020. Google has unveiled an adorable cutie pie of a car that doesn’t have a steering, brake pedals or anything that allows a user to control it, save for an emergency stop button. Just two months ago, Daimler Chrysler unveiled an 18 wheeled autonomous truck, and yes, we are talking about a 27 tonne monster that knows where it wants to go in life, or rather, on the road.

In fact, the technology behind self-driving car technology is advancing at such a rapid manner, that in recent months, the internet has become an arena for countless debates on a new subject: consequences of using self-driving cars. There are articles that discuss the redundancy of an insurance claim if you are using a self-driving car. There are countless others that merge the classic “Trolley problem” with the basics of automated decision making used in cars. In a gist, all these articles ask the same questions: what if self-driving cars, intentionally or unintentionally kill someone or destroy property? Are they a safer alternative to manual driving? Would people be able to hack into car systems wirelessly or may be, kill someone?

Let’s put these questions to ourselves. Given that the self-driving cars does become a reality, will it reduce the mistakes made by humans? Or will the self-driving cars lead to risks that we have not heard of. To answer the questions, one would counter that with a question- Don’t manual drivers make mistakes? Don’t they cause accidents?” Nevertheless, at least the self-driving cars can be tried and they can be programmed to avoid risks leading to better safety of passengers.

One might say that there is a point in using self driven cars if there is a drastic increase in statistics showing the automobile safety. But if the statistics, though it is a barefaced liar, has a different story to tell, then there is absolutely no point in using self-driven cars. Most people feel safe when they themselves are in control- not when the reins are with some fabricated chip. The only time when they feel safe is when they have statistical evidence. So the only question that makes sense is, “are self-driven cars statistically safer than human drivers?”

The sad truth is that statistical evidence would take time, because; there are only a very few autonomous cars are on the road today. However, Google says it has better statistics with their autonomous cars. Google has been working on autonomous cars since 2009 with more than 30 autonomous cars put on trial. The autonomous cars are tested in cities across the US and clocked more than 1 million miles. According to Google, the autonomous cars have had a total of 11 minor accidents as of today. Incidentally, Google claims that those accidents weren’t caused by the autonomous cars, but by its fellow motorists.

So, going by the above facts, one might say that the answer to the question “Are autonomous cars safe?”, is not so surprisingly, a reasonable “yes”. Autonomous cars are safe because they are not bound by emotions. They do not exhibit road rage. They do not use anything but cold, computational logic to make decisions. They are not distracted. And most importantly, they do not disobey traffic rules. Though all the above aspects do contribute to the added safety of the autonomous cars, perhaps the factor that contributes most to it could be that autonomous cars are well connected.

Autonomous cars are connected to a centralized system that supplies provides information about pretty much everything that is happening/ or possible to happen in the vicinity of their path. Much like Griffin, a character from the movie ‘Men in Black 3’. Though they are not “interdimensional beings capable of living in multiple dimensions at a same time”, they do have an extensive knowledge about all the possible outcomes that could occur in the route they take. So, they could potentially anticipate accidents before they happen and take the necessary measures to avoid the same.

The autonomous cars follow a modular design in which multiple autonomous cars are connected when they are in proximity. Each car is capable of making its own decisions and when an autonomous car in the vicinity goes haywire, the remaining autonomous cars coordinate with one another to bring the situation under control. Cool, isn’t it? In this way, the  autonomous cars would be able to efficiently reduce the number of accident cases and foster safety on roads.

Now that we are in the era of autonomous transportation that would inevitably infiltrate our daily life in the coming decade, the last question that would still linger in our minds, that one inconvenient question or fear would be “What would happen if the autonomous cars are hacked by someone?”. But since those risks are ever present in our tech savvy society we would ignore it. We might at the most, try to build a secure firewall or adaptive encryption, or high security codes. But no wall is impregnable. Every wall has a crack that can be breached. One day, someone would find that crack. Having said that, the designers of these cars will have to build failsafe cars and regularly provide software upgrades to improve the safety of passengers and also to other road users. With that, let’s hope to see these cars on road as soon as possible.

Leo Paul Johnson is a senior Patent Engineer in IP Astra

An insight to application developers on protecting their innovation

With increase in use of mobile devices in our day-to-day life, the innovation has shifted from personal computing to mobile computing. Particularly, the innovation is striving in developing applications running on mobile devices on the go. With the focus shifting to gain commercial success in developing mobile applications, lot of application developers are puzzled if the mobile applications can be protected from someone copying the applications when they publish or market the applications. With this post, we will throw some light on how mobile application developers can protect their innovation before the mobile applications are made public.

When we speak of mobile applications, two marketplaces come to our mind: Apple’s Appstore and Google’s Playstore (Who uses Microsoft and Blackberry stores anyway?). If we look at the applications on the Apple’s Appstore and the Google’s Playstore, the applications are nothing but software. There is a general perception that software is difficult to protect and let us assure you that software can be protected by means of patent and of course by copyright. In this post, we lay our focus on protecting mobile applications by patenting.

Typically, the mobile applications are categorized into two types. First, the applications that control the mobile device itself. Second, the applications that connect to a remote server to process data. For example, an application that can be used to control hardware of the mobile device, such as camera in the mobile device is patent eligible. Similarly, an application running on a mobile device that connects to a remote server containing data that either stores the data or process the data to be used on the mobile device is patent eligible. Let me explain to further clarify the above aspects. As known, many mobile applications that connect to the server processes the data at the server level and the data is sent to the mobile device. For example, a music recognition app records a segment of music and sends the audio clip to a server for processing-intensive analysis and recognition. The server then sends back information to the mobile device. For instance, the server may send the name and description of the identified music track, along with links to purchase or share the track. In the above example, the mobile application is making the mobile device to function in a certain way. For patenting the application, the functionality achieved using the application will be considered. The software code as-is, that achieves the function is not eligible for patent. The software code as-is can be protected under copyright (again, not getting into details).

It is important to understand the patentability criteria which are essential to ascertain whether a patent can be filed for the invention (mobile application). Generally, the patent offices across the globe have specific criteria for respective jurisdictions to determine patent eligibility for mobile applications. To grant a patent, the patent office of respective jurisdictions performs a search. The patent office performs the search to determine whether the mobile (patent) application has ever been patented, used or published before anywhere in the world. Further, the patent office checks whether the mobile application solves a particular problem in a technical field and produces a useful, concrete and tangible result. After determining that the mobile application submitted is not disclosed or used anywhere in the world, solves a particular problem in the technical field and has commercial application/ utility, the patent office will grant a patent for the mobile application.

The application developers should know that there is no worldwide patent and they have to file the patent application in each country of choice, depending on the market for the mobile application. As known, success of mobile applications depend on which markets one caters to. For example, if the developer in US wishes to publish the mobile application in Appstore of Europe and Japan, it is appropriate for the developer to file a patent application in US, Europe and Japan. In such a scenario, the developer should consider filing a provisional patent application in US, and wait for a year to see how the mobile application is performing in other markets. After analysing the performance of the mobile application in other markets, the developer may take priority from US patent application and can file patent application in other jurisdictions. If otherwise the developer is sure to file in multiple jurisdictions considering the mobile application to be a breakthrough innovation or for obvious business outcomes, the developer can file non-provisional patent application to protect the innovation.

It is important to know that patenting the mobile applications provide the greatest commercial benefit if expected lifespan of the technology substantially exceeds over the years. Further, patenting is beneficial if the technology of the mobile application is of great interest, appeal or application and if there is a scope for competitors to use the technology in their own applications. The developer must take care before filing a patent application for the technology which underlies a mobile application, in both the mobile device and the remote server. Also, the business outcome expected from the mobile application should be analysed in the long run. Filing patents in multiple jurisdictions will cost a lot of money for the developers. However, what if the developer just invented the next blockbuster? Therefore, developers should consider filing patents for their innovations to showcase their innovation and to protect themselves from competition.

Author, Chandrasekhar Raju, is Manager and Patent Agent at IP Astra

Microsoft Loses Battle for Trademark “Skype” in the EU

Choosing the right trademark for your brand is not as simple as picking a name that you believe no one else is using. The criteria for you to own trademark rights is that your mark not only be unique but also not confusingly similar to another’s mark. The wording used here is “similar” and not “identical” and that is where most trademark owners lose their trademark rights. This means that if the name you choose to represent your brand is so similar to another’s trademark that it would be likely to confuse the general public, then you may not have the right to that trademark.

Microsoft “Skype” is in exactly such trouble. BBC on the 5th of May has reported that the general court of the European Union has ruled that the name “Skype” is so similar to British broadcaster “Sky” that the public would be likely to confuse the two. Whether or not the general public is in fact going to confuse “Skype” with “Sky” is not the issue. The court feels that there is the “likelihood” of it and hence ruled in favor of “Sky”.

The Court further rejected the Bubble logo that is associated with “Skype” on the grounds that it resembled clouds and thereby a further association with “Sky”. The Court stated, “Conceptually, the figurative element conveys no concept, except perhaps that of a cloud…[That] would further increase the likelihood of the element ‘Sky’ being recognized within the word element ‘Skype’, for clouds are to be found ‘in the sky’ and thus may readily be associated with the word ‘sky’.”

Sky has made an official statement “Our intention has been to protect the Sky brand with our research showing that similarities in name and logo have the potential to confuse customers.”

In 2014, Microsoft faced a similar battle with Sky which resulted in them having to change their trademark for their cloud storage service from Skydrive to Onedrive. The company will appeal the Skype decision but remains to be seen if they will be forced to rebrand this trademark as well for the EU and retain it elsewhere.  However, a spokesperson from Microsoft informed BBC that “The case was not a legal challenge to Skype’s use of the mark, it was only against the registration”… And that they are “confident that no confusion exists between these brands and services and will appeal” and that “this decision does not require us to alter product names in any way.”

That being said, the verdict of the EU court opens up the possibility of Sky permitting Microsoft to continue to use the trademark under a license. But, Microsoft is only likely to make that decision after the appeal process is completed.

Author Lynn Bout Lazaro is an IP counsel

Parallel Imports & Trademarks

The fake goods and counterfeit market in India has been growing substantially in the last few years. India’s luxury market currently is at $8billion out of which 5% is fake or counterfeit. (http://trak.in/tags/business/2014/04/21/counterfeit-luxury-goods-sold-ecommerce-india/). In March of this year, the Mumbai Mirror reported that an authorised snap deal vendor was selling fake toners and cartridges. (http://www.mumbaimirror.com/mumbai/crime/Authorised-Snapdeal-vendor-caught-selling-fake-toners-cartridges/articleshow/46720290.cms). The Indian courts have come down heavily on such counterfeit distribution. However, the story is quite different for parallel imports or genuine products resold without the owner’s authority.

The controversy surrounding parallel imports and its effect on trademarks has been debated in the Courts for several years. Parallel imports occurs due to differential pricing of the same goods in the same or different markets. Essentially, when patented and/or trademarked goods are marketed and sold in a country with lower prices, be it due to competition, lower manufacturing costs, smaller economy or other market conditions, but then resold in a richer country at the same lower cost, it would be considered a parallel import.

For example, if a pharmaceutical company in the U.S were to sell drugs in Africa at low rates, anyone could import such drugs from Africa at these marginalised rates without the consent of the original pharmaceutical company. This would therefore undercut the profits of such pharmaceutical company.

When such import occurs without the consent of the trademark owner, it is essentially creating a trade channel that is parallel to the authorised channel of the trademark owner. As these goods operate in a non authorised area, such goods are considered to be in the “grey” market.

The TRIPS Agreement refuses to regulate this matter and permits nations to decide the law domestically.

India is said to follow what is called an “international exhaustion regime” wherein if the goods are purchased in accordance with all the laws of the country of India, the purchase is deemed valid, and the sale would not infringe the registered trademark. Kapil Wadhwa v Samsung (2012) was the landmark judgment wherein first the Delhi High Court held that if the goods bore a similar trademark to that of a registered trademark, whether the goods were genuine or not, it would be considered infringing, but later a Division Bench on appeal overruled this decision and held that parallel imports were not considered to be violative of trademark rights.

Section 30 (3) of the Indian Trademark Act was interpreted  by the Division Bench to mean that once goods bearing a registered trademark have legally entered the market i.e with the consent of the trademark owner, the subsequent sale of such goods does not lead to infringement. The Division Bench further explained that the proprietor of the trademark could oppose the subsequent sale of goods under its trademark, only if the goods were materially or physically altered so that it would change the nature of the goods. The Court did however order that the parallel importers must prominently state that the goods that are imported and they themselves are providing the warranty and maintenance services as opposed to the trademark owners.

The Government of India has prohibited parallel imports in other ways by enforcing the Intellectual Property Rights (Imported Goods) Enforcement Rule 2007 (the Rules‟) vide Notification No. 47/2007-Cus. (N.T.) dated 8 May 2007.  The proprietor of the trademark under these rules is permitted to give Customs a notification in the prescribed format requesting suspension and confiscation of infringing goods. The burden of proof shall fall on the proprietor in such a case.

But there is little or no remedy available under the Trademark Act and it would be interesting to see how the Supreme Court interprets Section 30(3) when the Samsung case comes before it in appeal. In the meantime, the only legal course available to a trademark owner in such circumstances is if the parallel importer compromises the reputation or goodwill of the trademark.

Author Lynn Bout Lazaro is an IP counsel

ANALYSIS OF AMENDMENTS IN IEEE PATENT POLICY

Standard Setting Organizations (SSO) are organizations for developing, coordinating, promulgating, revising, amending, reissuing and interpreting standards or, in simpler terms, developing global standards for a broad range of industries. There is a large number of SSOs that are quite active at present. Prominent among these SSOs is the Institute of Electrical and Electronics Engineers (IEEE). ASME, the ASTM international and the W3C are the other key players in this arena. Members of the SSOs hold Standard Essential Patents (SEP) for implementing the standards developed in a technology. These members tend to license the SEPs to different organizations or companies on the basis of a policy that is Fair, Reasonable and Non-Discriminatory (FRAND) for gaining monetary benefits and royalties. But of late the SSOs and the standards developed by them have taken the center stage during litigation procedures between corporate powerhouses. Some of the cases worth mentioning would be the Microsoft versus Motorola, the Apple versus Motorola, the Ericsson versus D-Link etc. In all these cases the IEEE Wi-Fi standard has played a prominent role. As a matter of fact, the FRAND commitments are cited 10 times more often now than it was being cited 10 years back.

IPR experts and observers have long been pushing for a clarification from the SSOs on the issue of their patent policy. And finally, on February 8th   2015 the board of directors of the Institute of Electrical and Electronics Engineers (IEEE) voted to approve a set of amendments to the organization’s patent policy. The IEEE provides a link here to the current draft of the proposed IPR policy. On a first time read, many would find the IEEE policy change contrary to the US law for determining royalty rates and providing injunctive relief for SEPs. Some of the key points of the IEEE amendments are:

  • The compensation for the usage of an essential patent claim is considered based on the value of the relevant functionality of the Smallest Saleable Compliant Implementation that practices the essential patent claim.
  • The submitter will make available a license for Essential Patent Claims to an unrestricted number of applicants on a worldwide basis without compensation or under reasonable rates, with other reasonable terms and conditions that are demonstrably free of any unfair discrimination.
  • The submitter of an accepted Letter of Assurance who has committed to make available a license for one or more essential patent claims agrees that it shall neither seek nor seek to enforce a Prohibitive order based on Essential Patent Claims in a jurisdiction.
  • Reciprocal licensing shall mean that the submitter of an LOA has conditioned its granting of a license for its Essential Patent Claims upon the Applicant’s agreement to grant a license to the submitter with reasonable rates and other reasonable licensing terms and conditions.

The amendments to the IEEE patent policy point out the fact that SEP holders are not allowed to seek injunctions against licensees. Further, by asking to consider the value of the smallest salable unit, the IEEE patent policy amendments considerably reduces the royalty value the Standard Essential Patent holders were to receive in return for their SEP(s). A setback, which is more than likely to happen, will be an increase in litigation cases. Why term it a setback? Because the real deal was to reduce litigations. At the end of the day, it is a field day for licensees, as they don’t face the threat of an injunction. And disappointing for the SEP holder, as the SEP’s monetary value is decreasing.

A point worth mentioning would be that denying access of SEPs to firms dampens any chance whatsoever the firm has for competing in a market where consumers are more often attracted to products that are standardized. Also, regulating the access of SEPs to firms by a third party would tend to reduce the quality of standards in times to come. Similar was the expectation from the IEEE patent policy amendment of 2007 when nearly all the foremost IPR experts had predicted the amendments to be a complete disaster. But nothing of that sort happened. And when we look at the present amendments, of course there are short comings but at least the IEEE has given a much awaited and needed clarification on the FRAND policy it implements.

 Perzeus Abhas is a Patent Engineer at IP Astra

ISDS and Intellectual Property

This is the story of something that happens all the time: Companies suing governments over invalidated/ rejected patents/ patent applications. However, this commonplace news snippet becomes not-so-commonplace because of the huge amount of money involved. Also because of the fact that this case has opened up a new way by which Multinational Companies can influence state policies.

Last year, Eli Lilly, a US Pharmaceutical company sued the government of Canada after two of its patents were invalidated by courts in Canada. If that sounds familiar that’s because you have read about Novartis v. Union of India & Others that was decided exactly two years ago, April 2013.

Now let’s take a look at the facts we have.

Sometime back, the supreme court of Canada invalidated two patents of Eli Lilly on the basis of a “promise doctrine” ie  if a patentee “explicitly and unequivocally” promises a use or result for an invention, the patentee is responsible to keep that promise. For example, in this case, Eli Lilly  had promised that its inventions, which were pharmaceutical drugs, were better than rest of the drugs in the market. But it was more of a guess, and the courts in Canada invalidated the patents in 2007 and then again in 2011.

According to Eli Lilly’s notice to Canada, this invalidation was simply “absurd”. Eli Lilly argues that that “The promise doctrine” was introduced way after the patent was granted in Canada, and its patents should not be invalidated using the promise doctrine.

Now if you know anything about patents, you would know that there is absolutely no point in arguing here. Patents are routinely invalidated when the law changes or in common law jurisdictions, when there is a new ruling. That’s part of the reason why a Bilsky Vs Kappos or an Alice vs CLS gains a lot of interest among patent lawyers.

The difference here is, not only has Eli Lilly sued Canada, it has demanded a hefty compensation of $500 million for lost potential profits. Now that is something that has been not heard of. To answer the question “How on earth could they do that!!”, allow me to introduce to a term that has been used time and again for several nefarious purposes: ISDS.

ISDS

ISDS or The Investor State Dispute Settlement, are a group of about 3000 agreements that have been implemented as early as the end of the second world war. There were a lot of newly formed independent nations after the second world war, and they were all hungry for foreign investments. These agreements promised foreign investors a set of minimum guarantees and they felt safe to invest in companies. Now one of the guarantees that the ISDS provided was that a state shall provide compensation for “expropriation” of investments. If that is a word too big for you, it means that the state shall provide compensation for investments stolen by the state. If the investors can prove that in a court of law, oh wait, there is no court of law here- ISDS disputes are solved in a tribunal of private lawyers chosen by the government and the investors. So if the investors are able to prove that in a tribunal of private lawyers that the government is liable to compensate them, the government is liable to pay them out. There are no binding precedents, or appellate reviews.

Now all of the above facts about ISDS have been in existence  for the past sixty five years.  So what’s new? What’s new is that, companies have started treating Intellectual Property as investments to the extent that a simple invalidation of a patent is treated as expropriation.  Likewise, inability to display a trademark is being counted as expropriation. To cite an example:

In 2011, the Australian Government  banned use of trademarks on cigarette packets. Name of the company was to be written in a generic manner, and the cigarette packet was to be labelled with messages like “Smoking Kills” “Smoking causes blindness” etc. Immediately, Phillip Morris, the tobacco company known for Malboro, sued the Australian country for a hefty sum. The lawsuit failed, but that did not stop them from sending notices to poorer countries like Togo and Uruguay when these countries came up with similar laws.

But that again, was about trademarks. Eli Lilly is probably the first company to sue a nation for invalidation of patents. That too for $500 million. The basis for the suit is that patents are investments and invalidating them using a new law is expropriation of the “investment”. Seemingly, Eli Lilly assumes that an issued patent should never be invalidated and also that a nation cannot modify its laws without violating the “ISDS gurantees”. Eli Lilly’s case is further strengthened because of the TRIPs agreement of 1994, that guaranteed a minimum level of IP protection in all the signing nations.

Here are a list of allegations put forth by Eli Lilly:

  1. NAFTA and TRIPS agreements refer to mandatory obligation to grant patents to inventions that are “useful” and have “industrial applicability”. Eli Lilly alleges that Canada has failed to enforce its patents, both of which being useful with industrial applicability
  2. Eli Lilly states that Canada cannot compel patentees to include evidence of utility in their patents.
  3. Lilly objects that the “Promise” doctrine is being improperly applied only to pharmaceutical patents.

All the above objections can be objected to because both the TRIPs and the NAFTA have provisions to provide flexibility to countries to define key terms like “new” and “patentable”. But Eli Lilly claims that Canada’s definition of the word “new” is unacceptable.

So the bottom line is, that should Eli Lilly’s allegations and claims are to succeed, several international norms that help countries to have different standards of IP protection would be destroyed.

Eli Lilly’s allegations could spell trouble to the international IP environment, particularly jurisdictionally isolated patent provisions like Compulsory licensing, provisions to prevent Evergreening of drugs, etc. Further, the ruling would also cause countries to have lesser control over their IP policies.

So unlike the commonplace Pharmaceutical IP lawsuits, this particular Lawsuit should be of major concern. Caution must be held while signing anymore ISDS agreements. Moreover, new provisions like fast track legislation of ISDS cases should be fiercely opposed.

Leo Paul Johnson is a senior patent engineer at IP ASTRA

The Importance of Common Law Trademark Searches – Tata “Vistara” Trademark Case Study

The most common refusal at the Trademark office in an attempt to obtain a trademark registration is that of a ‘likelihood of confusion’ with another similar mark with similar goods and services. While most of us believe that we have coined a unique trademark as the brand name for our product or service, we cannot be sure that someone else is not already using such name. A ‘likelihood of confusion’ refusal after the trademark application is filed or an objection thereof from another user of the same or similar name, might result in the application being rejected outright.

Thus, a trademark search prior to applying for a trademark registration is essential if you want to avoid ‘likelihood of confusion refusals or objections from other users. Most trademark attorneys or even in house counsel will conduct a basic search on the Trademark Registry prior to filing the application but a common law search is also just as important and the ongoing issue with the Tatas attempted trademark registration of the name “Vistara” serves an example of just how much.

The “Vistara” trademark

 

The Tatas and Singapore Airlines entered into a joint venture (Tata SIA Airlines Ltd) in 2003 to establish “Vistara Airlines” wherein the Tatas own the larger share of 51% and Singapore Airlines the remaining 49%.

On applying to register the trademark “Vistara” the Registrar of trademarks in January of this year has found other similar trademarks registered with the Trademark Registry for similar goods and services. In the examination report, the Registrar of Trademarks has said that the Vistara Trademark is open to objection on grounds of refusal because “same/similar marks are already on the record of the register for same/similar goods/services.

Further, the trademark “Vistara” has been objected to by a similar user “Vistara Voyages Pvt. Ltd.” The situation became public when Vistara Voyages filed a civil suit in the High Court of Karnataka to restrain Tata SIA Airlines Ltd. from using the mark “Vistara”.

Vistara Voyages owns the domain name ‘vistara.in’ at the time of its incorporation while Tata uses “vistara.co.in”. However, the proprietor of Vistara Voyages only applied to register its mark in September 2014 two months after Tata SIA Airlines applied for its registration. So the question here is what rights Vistara Voyages has over Tata SIA Airlines under current trademark law.

Rights of the Senior User

 

In India, the owner of the trademark with a better claim is usually the senior user.

For example, if an applicant applies for registration before anyone else commences use, it is the applicant who is first to file the application who would be considered the owner of the mark. However, if the applicant is the first to apply for trademark registration but there is a person who was already using the mark but has not yet applied for registration, it is user of the mark who first used it in commerce who will be considered the owner of the mark. This owner has the right to sue an infringer for ‘passing off’.

In this case Vistara Voyages claim to have been using the mark since 2008 and were incorporated five years prior to Tata SIA Airlines. Hence they can claim prior use and bring a suit of infringement against Tata SIA Airlines.

This is why common law trademark searches are just as important as searches on the Trademark database.  Tata SIA Airlines should have been aware that the Vistara mark was in commercial use for similar services and that Vistara Voyages owned the domain name ” vistara.in” prior to filing its trademark application

Conducting a Common Law Trademark search

 

A common law trademark search can be carried out by searching through directories and databases. This includes the Internet, market surveys, yellow pages, domain names etc. You can hire a law firm to conduct the search for you or you can do it yourself.

The search must be conducted for “similar” names for “similar goods and services”. A likelihood of confusion refusal arises for “similar” and not only “same”  or identical names. The main criteria is that your mark should not be likely to be confused with a similar mark in the eyes of the ordinary consumer. There need not be “actual” confusion but a “likelihood” would suffice for a rejection.

In order to avoid a situation like the Tata “Vistara” trademark case, it is critical that trademark searches be taken more seriously. Tata SIA Airlines have been given one month to respond to the Examiner’s rejection of the mark. The civil suit filed by Vistara Voyages is still pending.

Source: http://profit.ndtv.com/news/corporates/article-tatas-vistara-trademark-objected-739695

Author Lynn Bout Lazaro is an IP counsel

Provisions of the Indian Trademark Act declared unconstitutional

The Madras High Court (HC) on March 10, 2015 has declared certain provisions of the Indian Trademark Act 1999 as unconstitutional. In particular are the provisions that provide for the qualification criteria of the members of the Intellectual Property Appellate Board (IPAB). This ruling is the result of a writ petition filed by Prof. Shamnad Basheer in May 2011 contending that the entire selection procedure of the IPAB violates the separation of powers between the executive and the judiciary. Arvind Datar, senior lawyer representing Basheer, has said that the appointment process to the appellate board “was flawed” as a technical member could after a certain number of years become vice-chairman and subsequently a judicial member of the appellate board with no further qualification required. Further, the Act also allowed members of the Indian Legal Services or Indian Government Officers to become judicial members of IPAB.

For those of you who don’t know already, the IPAB has jurisdiction to hear all appeals from the order or decision of the Registrar with regard to cases relating to trademarks, patents and geographical indications. It also has the authority to provide an opinion on all cases pertaining to rectification of register. Thus, when the patent or trademark application that you had taken the trouble of preparing and filing gets rejected, the law gives you an opportunity to file an appeal with a board set up especially for handling such grievances.

However, in the recent years the IPAB has been riddled with several problems of its own. For example, once your appeal reaches the IPAB, your dispute would be examined by judicial members who have had little or no expertise in the field of Intellectual Property. That is, until a few days back.

 

The writ petition filed in 2011 basically stated that the judicial members of the highest technical dispute body in India, created to hear Intellectual Property disputes, were incompetent. The petitioner Prof. Shamnad Basheer stated, “There is not a single person on the IPAB who has any relevant IP expertise…..the IPAB has been functioning in contravention of the Constitution of India, which mandates all courts and tribunals to be independent and manned by competent people.

The Verdict

In light of this petition, the Madras HC comprising of Chief Justice Sanjay Kishan Kaul and Justice M M Sundresh has,

  1. Declared that the search and selection committee for the posts of the Judicial Member, Vice- Chairman and Technical member, headed by the secretary, department of industrial policy and promotion as its chairman, was loaded in favour of the executive, which is impermissible under law, as held by the Supreme Court,
  2. Recommended the Chief Justice of India to the post of IPAB Chairman be given due consideration by the Appointment Committee of the Cabinet,
  3. Directed the Secretary, Department of Industrial Policy and Promotion, Ministry of Industries and Commerce, to re-constitute the Committee, providing a predominant role in selection process to the judiciary for appointing members, both for the Vice-Chairman, Judicial Member and Technical Member. Source: Economic Times http://www.indiaeveryday.in/fullnews-certain-provisions-in-trademarks-act-unconstitutional-hc-1001-167555.htm

The petitioner Basheer after the verdict has said “Our stand has been vindicated. And I really hope the government begins to take tribunals more seriously and secure them on firmer legal moorings,”

How does this affect us?

  1. Well, before we jump to any conclusions, the High Court is not saying that the IPAB itself is unconstitutional and neither is the Indian Trademark Act of 1999 as many online sites would leads us to believe. Certain provisions in the Act need to be struck down as the separation of powers of the executive and judiciary is of paramount importance to the functioning of a democracy and the selection process of judicial members of the IPAB crosses this line or is blurry at best.
  2. The positive verdict instills faith in the judiciary in its power to strike down unconstitutional laws and to direct clear steps and measures to be taken to enforce its verdict. However, it remains to be seen the length of time taken to enforcThe Madras High Court (HC) on March 10, 2015 has declared certain provisions of the Indian Trademark Act 1999 as unconstitutional. In particular are the provisions that provide for the qualification criteria of the members of the Intellectual Property Appellate Board (IPAB). This ruling is the result of a writ petition filed by Prof. Shamnad Basheer in May 2011 contending that the entire selection procedure of the IPAB violates the separation of powers between the executive and the judiciary. Arvind Datar, senior lawyer representing Basheer, has said that the appointment process to the appellate board “was flawed” as a technical member could after a certain number of years become vice-chairman and subsequently a judicial member of the appellate board with no further qualification required. Further, the Act also allowed members of the Indian Legal Services or Indian Government Officers to become judicial members of IPAB.For those of you who don’t know already, the IPAB has jurisdiction to hear all appeals from the order or decision of the Registrar with regard to cases relating to trademarks, patents and geographical indications. It also has the authority to provide an opinion on all cases pertaining to rectification of register. Thus, when the patent or trademark application that you had taken the trouble of preparing and filing gets rejected, the law gives you an opportunity to file an appeal with a board set up especially for handling such grievances.However, in the recent years the IPAB has been riddled with several problems of its own. For example, once your appeal reaches the IPAB, your dispute would be examined by judicial members who have had little or no expertise in the field of Intellectual Property. That is, until a few days back.

     

    The writ petition filed in 2011 basically stated that the judicial members of the highest technical dispute body in India, created to hear Intellectual Property disputes, were incompetent. The petitioner Prof. Shamnad Basheer stated, “There is not a single person on the IPAB who has any relevant IP expertise…..the IPAB has been functioning in contravention of the Constitution of India, which mandates all courts and tribunals to be independent and manned by competent people.

    The Verdict

    In light of this petition, the Madras HC comprising of Chief Justice Sanjay Kishan Kaul and Justice M M Sundresh has,

    1. Declared that the search and selection committee for the posts of the Judicial Member, Vice- Chairman and Technical member, headed by the secretary, department of industrial policy and promotion as its chairman, was loaded in favour of the executive, which is impermissible under law, as held by the Supreme Court,
    2. Recommended the Chief Justice of India to the post of IPAB Chairman be given due consideration by the Appointment Committee of the Cabinet,
    3. Directed the Secretary, Department of Industrial Policy and Promotion, Ministry of Industries and Commerce, to re-constitute the Committee, providing a predominant role in selection process to the judiciary for appointing members, both for the Vice-Chairman, Judicial Member and Technical Member. Source: Economic Times http://www.indiaeveryday.in/fullnews-certain-provisions-in-trademarks-act-unconstitutional-hc-1001-167555.htm

    The petitioner Basheer after the verdict has said “Our stand has been vindicated. And I really hope the government begins to take tribunals more seriously and secure them on firmer legal moorings,”

    How does this affect us?

    1. Well, before we jump to any conclusions, the High Court is not saying that the IPAB itself is unconstitutional and neither is the Indian Trademark Act of 1999 as many online sites would leads us to believe. Certain provisions in the Act need to be struck down as the separation of powers of the executive and judiciary is of paramount importance to the functioning of a democracy and the selection process of judicial members of the IPAB crosses this line or is blurry at best.
    2. The positive verdict instills faith in the judiciary in its power to strike down unconstitutional laws and to direct clear steps and measures to be taken to enforce its verdict. However, it remains to be seen the length of time taken to enforce this verdict and in the meantime the employment status of the current judicial members seated on the board is unclear, not to mention the status of preexisting disputes put before such members. But most importantly, this is only the first round and the matter is likely to be examined in the higher court. Let’s hope the SC can recognize the value of this petition and uphold the HC verdict.
    3. In any case, the verdict gives a voice to Basheer and many others who hope to strike down outdated and other illicit laws and provisions in India. Given the history and culture of our country, the list of such outdated and unconstitutional provisions is endless and we desperately need citizens like Basheer to advocate for us.

    e this verdict and in the meantime the employment status of the current judicial members seated on the board is unclear, not to mention the status of preexisting disputes put before such members. But most importantly, this is only the first round and the matter is likely to be examined in the higher court. Let’s hope the SC can recognize the value of this petition and uphold the HC verdict.

  3. In any case, the verdict gives a voice to Basheer and many others who hope to strike down outdated and other illicit laws and provisions in India. Given the history and culture of our country, the list of such outdated and unconstitutional provisions is endless and we desperately need citizens like Basheer to advocate for us.

Author Lynn Bout Lazaro is an IP Counsel