Dreyfus

On April 2013, the British Virgin Islands (BVI) passed a new Trade Marks Act in order to bring to date the 19th century country’s trademark.

Among the features of the new law:

–    the classification system will be based on the Nice Classification unless the Financial Services Commission decides to use another one,

–    only a registered trademark agent can apply for the registration of a trademark,

–    it will be possible to claim priority for a trademark already registered in a Paris Convention country or a World Trade Organization member,

–    once a trademark is registered, the renewal period will be 10 years. However, if a trademark has been registered before commencement of the Act, its 7-year renewal period will be unchanged until expiration, and

–    for marks not registered in the BVI, use of ® or the word “registered” without being able to show a valid registered certificate from another jurisdiction is subject to a fine.

The report published by European Commission for the year 2012 presents statistical information on the number of detentions and other customs actions over the past year(1).

The number of individual articles detained are down over 65%. Indeed 114,772,812 articles have been detained in 2001 to 39,917,445 in 2012. However, regarding instances of imports, the results have remained quite stable (91,245 detentions in 2011 to 90,473 in 2012).

This shift is due to the availability of goods online which infringe intellectual property rights. The goods arrive to Europe generally through post and couriers.

The articles come for the most part from China for CD, DVD and tobacco, Marocco for foodstuffs and Bulgaria for packaging materials.

In 90% of the cases, detained goods were destroyed either after the owner of the goods and the right holder agreed on destruction or after the right holder initiated a court action. The report says also that 8% of detentions have been released because the right owner didn’t react to a notification or because the goods were genuine.

It is important to set up a customs surveillance and seizures. Our law firm can advice and assist you to set up a monitoring of your company trademark at customs level in France, as well as in the European Union.

                                                                     
(1) http://ec.europa.eu/taxation_customs/resources/documents/customs/customs_controls/counterfeit_piracy/statistics/2013_ipr_statistics_en.pdf

In a recent decision (1), the Trademark Trial and Appeal Board (TTAB) sustained an opposition requesting the rejection of the trademark EPI-KEY based on a likelihood of confusion with the trademark EPIPEN.

The TTAB is a body within the United States Patent and Trademark Office (USPTO) responsible for hearing and deciding certain kinds of cases involving trademarks. More specifically, the Trademark Trial and Appeal Board decides adversary proceedings involving notably oppositions to the registration of trademarks and petitions to cancel trademark registrations.

The main point to emphasize in this decision is the rejection of the applicant’s argument that any risk of confusion can be avoided by the need that the medicines be prescribed by a doctor.
Both marks were used for medical treatment of allergies with epinephrine. The Board found plausible that the patient requests the wrong device to his doctor thinking it was the other one. Patients and even physicians can also have the mistaken belief that both medicines are manufactured by the same company.

So, even if the products are prescribed by professional intermediaries there may still be a risk of confusion between two marks.

                                                                    
(1)    Mylan, Inc. v. Beaufort County Allergy, opposition No. 91195868 (USPTO TTAB June 19, 2013)

Product placement is defined as all forms of commercial, audiovisual communication that include a product, a service or brand, or make reference to it by inserting it into a program, in exchange for payment or other benefit in kind (1). This communication method is termed hybrid whenever it integrates a brand into a non-commercial context in order to influence the spectator. The greater the program’s popularity, the greater the brand exposure, and sales of branded products will increase correspondingly.

Nevertheless, as regards product placement, there is a significant gap between France and the United States. In France, product placement does not account for more than 5% of total film budgets, against 30% in the United States. As an example, the Apple brand alone financed 16% of the total budget of the film “Mission Impossible: Phantom Protocol” in 2011, representing an investment of $23.5 million.

The success of product placement in the US is essentially due to the absence of regulations or legislative structures in this domain.

In France, product placement has been prohibited for a long time (2). The French Higher Audiovisual Council (CSA) allowed a certain tolerance for the cinema without specific guidelines. Then a 2007 European directive (3) reaffirmed the principle of the prohibition of product placement across all audiovisual media, but left to the discretion of Member States, however, the possibility of allowing it within a given framework. France transposed the directive in 2009 (4) and granted the CSA the authority to determine the conditions under which audiovisual communication programs can feature product placement (5). The CSA defined the conditions as follows:

• Product placement is only authorized in films, audiovisual fictions and music videos unless the production is for children. It is banned in all other programs.
• Product placement must exclude alcoholic drinks, tobacco and related products, medicines (with or without prescription), fire-arms and baby-foods.
• The spectator must be informed of the existence of product placement notably by the use of a pictogram appearing as follows on the screen.

As well as being lucrative and providing an increasing number of product sales, product placement in films also has an impact on the brand’s reputation itself. Placement can be extremely beneficial in cases where the trademark holder is responsible for the placement, but equally it can harm the brand’s reputation where this is not the case. It may be that the holder is not satisfied by a placement, either because it hadn’t been requested or his opinion had not been sought, or because the placement did not respect the terms of the contract. In certain cases, unsolicited placements can devalue the brand or product. In this type of case, lawsuits could be filed for abusive, unauthorized use of a trademark or for tarnishing the image or reputation of the brand.

Product placements must therefore be chosen with care. Need advice? Dreyfus, specialists in trademark protection, are here to assist you.

                                                                         
(1)    Article 1(m) in directive 2007/65/CE.
(2)    1989 Directive n°89/552/CEE and 1992 transposition law prohibiting product placement with the exception of cinematographic productions.
(3)    Directive 2007/65/CE of the European Parliament and the Council of December 11 2007 modifying Council directive 89/552/CEE.
(4)    Law n° 2009-258 of March 5 2009.
(5)    Deliberation n° 2010-4 of February 16 2010 concerning product placement in television programs, published in the Official Journal on March 5 2010, modified by deliberation on July 24 2012, published in the Official Journal on August 7 2012.

Customs officers play an important role in identifying, at border-crossings, goods suspected of counterfeiting trademarks, models or patents.

What means do Customs officers have at their disposal to prove that articles are counterfeit?

Two types of seizures are permissible by law, one being preventative, the other prohibitive.

As a preventative measure, Customs authorities protect firms that have filed an interception request. This allows Customs officers to hold any suspicious goods for a period of ten days, limited to three days in the case of perishable goods.

As a prohibitive measure, Customs authorities implement a process of seizure where counterfeit is proven and thereby ensure the immediate withdrawal of counterfeit goods from sales channels, whilst at the same time taking the offenders to court.

PREVENTION: Customs retention

Intellectual property rights holders must file an interception request in order to activate a Customs watch which keeps them informed about the importation into France of allegedly counterfeit products.

When?

The request is made by simply providing the certificate of registration for a trademark, model or patent delivered by the National Institute for Intellectual Property (INPI) or other registration office. This measure is preventative and can be done before any cases of counterfeit are confirmed.

How?   

The request form asks for certain information that ensures that Customs controls are effective:

• The intellectual property title deed
• Whom to contact (technical and administrative staff)
• A technical description of the genuine goods, production lines and transport itineraries
• A description of the illegal copy if the counterfeit goods are already in circulation

Duration?   

The interception request is valid for one year from the date the dossier is approved by the administration. The cover can be renewed by written request. All information provided is confidential and may not be disclosed by Customs!

The advantages of the Customs retention process:

• The information gathered enables Customs checks to be better targeted and therefore more effective.
• The interception request is a prerequisite before any suspicious goods can be held for 10 days.

This procedure is carried out in close collaboration with rights holders

In order to file an interception request, the rights holder (or their representative) must comply with the following two conditions:

• The holder must provide a very detailed description of the goods in order to help Customs officers spot possible counterfeit items.
• This must be accompanied by relevant proof confirming that the request comes from appropriate rights holder.

In order to facilitate Customs checks and make them more effective, specific Customs training may be necessary. The rights holder has the possibility of training Customs officers in order to help authenticate goods examined by interception request.

PROHIBITION: Customs seizure

The intellectual property rights holder or their exclusive licensee must make a formal request to the president of the ‘Tribunal de Grande Instance’ (TGI or High Court) since seizure of counterfeit items comes under their jurisdiction. This seizure can be real or descriptive. In order to validate the seizure, the applicant must assign either as a civil entity before the TGI or directly before the Criminal Court within 15 days.

Civil responsibility

The lawsuit for counterfeit brought before the competent TGI authorities follows the rules laid down by common law and the case is to be heard within 3 years of the date of infringement. The case is  usually brought by the rights holder, but their exclusive licensee can act in place of the holder if the latter, having been invited to proceed, declines to do so, unless the licensing agreement specifies otherwise.

When filing a lawsuit for counterfeit, the IP rights holder must prove that the act or acts of counterfeiting have occurred in accordance with the general principle of article 9 of the Civil Code according to which “it is the responsibility of each party to prove, in accordance with Law, the necessary facts in support of their claim.” Counterfeiting may be proven by all lawful means, but infringement seizure is the method most frequently used by rights holders.

In its final decision, the Court can ban the production of all counterfeit items, order the confiscation of goods bearing the counterfeit brand and award damages to the trademark holder in order to compensate all losses due to counterfeit.

Penal responsibility

This type of case is to be filed under the same conditions as with a civil case, in other words either by the trademark holder, or by his exclusive licensee. The public lawsuit is to be filed either by The Crown or by the victim via a civil case. Since counterfeiting is a crime, the case is to be heard within 3 years. This offence is punishable by four years imprisonment and a fine of 400,000€ (if the offence is carried out by organized crime the sentence can be extended to five years imprisonment and a 500,000€ fine). Judges have the right to pass additional sentences at their discretion: they can publish both the verdict and the sentence, as well as confiscating items and objects used to commit the crime.

Customs interceptions at French borders provide IP title holders with effective protection of their rights. Community Law established by two regulations(1) also ensures that Customs checks regarding IP rights are very effective.

On June 11 2013 the European Parliament adopted new regulations relating to Customs operations in order to ensure a greater respect for IP rights. This will be applicable from January 1st 2014 onwards and will replace European Community regulation 1383/2003 by introducing certain improvements:

• The simplified procedure will lead to the destruction of counterfeit goods, without a  Court Order, providing that the rights holder gives their agreement as must the importer.
• Those who are surprised to receive small quantities (under 2 kilos) of counterfeit goods in the post, will have 10 days in which to consent to their destruction without having to pay for their storage or removal.
• The list of protected IP rights has been extended to provide even greater protection      (protection of commercial names, topographies of semi-conductors…).
• The existing process for the rapid destruction of counterfeit goods is now compulsory     in all member States.
• Exercising the right to be heard has been harmonized concerning those for whom the      seizure may be detrimental.

We cooperate regularly with Customs authorities in the fight against counterfeit and piracy in every area of intellectual property. We are available to advise you on the best strategy to adopt in order to establish an effective Customs watch.

                                                                        
(1)Regulation no 1383/2003 of July 27 2003, supplemented by regulation no 1891/2004 of October 21 2004