Lawyers to the technology, media and sport industry
ip news
Winter 2003
contents
And the winner is....
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Hey, that was my idea!
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Exploiting your archive
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Stop press
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In the news....
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Welcome to the
Winter edition...
This edition focuses on two
areas: breach of confidence and
exploiting archive material. The
article "Hey, that was my idea!"
outlines what to do if someone
steals your idea and how to stop
it happening in the first place.
The feature article "Exploiting
your archive" summarises the
complex legal issues associated
with exploiting archive material.
Also, we are delighted to report
that our Group has been highly
praised in this year's Legal 500
and Chambers directories. We
thank you, our clients, for making
this possible!
www.ngj.co.uk
And the winner is....
Our Technology, Media & Sport
Group, which has received high praise
in this year's Legal 500 and Chambers
legal directories. In the Legal 500
rankings, the Group is rated for IP:
contentious, IP: non-contentious, and
Licensing, Gaming and Betting and
further improved its ranking in the
Information Technology section.
Amongst other things, Legal 500
highlights the achievements of partner
Dominic Bray in advising AOL on a
dispute with one of its major suppliers
of network services, and partner Peter
McBride who acted for Eurostar on a
project to create a comprehensive
ticketing service with mainland travel
companies.
On IT, the Chambers directory reports
that Michael Webster is recommended
by clients as a "commercial, efficient
and responsive" advocate with a
healthy IT-led practice and that he is
"supported by a sizeable team giving
commercial IT advice". Chambers
also states that the strongly
recommended team has "developed
into one of the best sports practices in
London".
“commercial, efficient and
responsive”
“one of the best sports
practices in London"
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news
Hey, that was
my idea!
This is a phrase that solicitors often
hear from clients, especially those
working in the creative industries of
interactive entertainment and
marketing/advertising. Anyone in
business will be familiar with the
scenario - you have a great idea that
you know (or at least hope) will make
millions, you do some prep work
(perhaps creating proposal documents
and preliminary design specifications)
and then set up meetings with
similarly inspired people who you
believe can help make your idea a
success. A short while later, you find
out that someone has taken your idea
and beaten you to the marketplace.
What can you do about it? And what
steps can you take to stop this from
happening again?
Breach of confidence
Your most likely course of action will
be to sue for damages or an account
of profits based on breach of
confidence.
To succeed in a claim for breach of
confidence, you need to demonstrate
that:
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the information given to the
defendant was capable of being
confidential;
the information was disclosed in
circumstances imparting an
obligation of confidence; and
the information has been
misappropriated by the defendant.
Capable of being
confidential
For a creative idea to have the status
of 'confidential information', it must
have the necessary qualities of
confidence. The idea must be clearly
identifiable, sufficiently original,
commercially attractive and
sufficiently well developed to be
capable of commercial exploitation.
Disclosed in confidence
The general test is whether a
reasonable person in the position of
the defendant would have realised
that the information was being given
in confidence.
Factors that will be relevant include
the venue for and nature of the
meeting at which disclosure took
place, whether you are in the
business of creating and developing
ideas for commercial exploitation, and
the use (or not) of a confidentiality
notice on the documents disclosed.
For example, it will be harder to
establish that an idea was disclosed in
confidence where you discussed it
with the defendant in a bar after a
chance meeting at a conference,
rather than at an arranged business
meeting in either of your offices.
It will also assist your case if you can
show that you asked the defendant
to sign a confidentiality agreement
before disclosing the idea. Even if the
confidentiality agreement was never
signed, it will help you to
demonstrate that the idea was
disclosed in circumstances imparting
an obligation of confidence.
Misappropriation
The final step is to show that the
defendant misused the confidential
information. The facts will need to be
carefully analysed, as it will rarely be a
straightforward case of the defendant
copying word-for-word your
confidential idea. You also need to be
prepared to rebut any argument that
you consented to the defendant using
your confidential idea.
How to prevent this
happening again
Once confidential information is in the
public domain, the quality of
confidence is lost and cannot be
regained. If you suspect that
someone is going to launch a new
product/service based on your
confidential idea, you may be able to
obtain an injunction to prevent them
doing so. However, once the idea has
been released into the public domain,
your only recourse will be to sue for
breach of confidence and claim
damages or an account of profits.
Things you can do to improve your
chances of being successful in a claim
for breach of confidence include:
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mark documents as 'confidential'
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ask the recipient to sign a
confidentiality agreement and/or
verbally indicate that the
information is confidential before
disclosing it.
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avoid disclosing confidential
information in informal, public
places.
Winter 2003
Exploiting your
archive
Copyright
Copyright is common to virtually all
types of content and is therefore a
crucial consideration for anyone
wishing to store or to exploit archive
material.
The word "archive" often conjures up
images of dusty libraries and vaults of
historical but largely useless and
uninteresting material. The digital
revolution has swept the dust from
this concept. With the British
Museum's storage capability now
reduced to the size of a fingernail,
huge quantities of information are
now available at the press of a button
or the click of a mouse. Enhanced
delivery mechanisms such as the
internet and next generation mobile
phones have created a content-hungry
economy. Archives are a rich and
potentially cheap source of content.
Copyright in the UK subsists in various
types of works by virtue of the
Copyright, Designs and Patents Act
1988 (the "CDPA"). In general terms,
the owner of a copyright work has
the exclusive right to do certain acts
such as making copies, publishing,
broadcasting or selling the work.
Copyright is commonly perceived to
be a "negative right" entitling the
owner to prevent others from
exploiting the work (essentially, any
form of 'copying') without its consent.
In order to add depth and interest to
new content at relatively low cost,
many content providers are seeking to
leverage value from their archives.
Examples include:
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Sport: results databases, statistics,
highlights and full event recordings
are all valuable.
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Music: back catalogues. David
Bowie raised $55 million in a
securitisation of his music rights,
largely based on the value of the
back catalogue.
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Press: searchable on-line press
archives are a valuable research
tool.
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intellectual property rights ("IPR").
Businesses looking to exploit archive
material will need to consider the
following IPR and related rights and
how they may affect the exploitation
of archive material:
Photographs: value often
dictated by fashion.
Archive material largely comprises
copyright works, which themselves
may contain many different
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Copyright and moral rights.
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Database rights.
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Trade marks and passing off.
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Image rights.
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Data protection.
In the UK there are no formalities
needed to acquire copyright
protection. Provided the work meets
the statutory qualification
requirements, the right arises
automatically as soon as the work is
recorded "in material form". In
contrast, in the US, although
copyright exists from the moment the
work is created, the work must be
registered with the US Library of
Congress if the owner wishes to bring
an infringement action.
Copyright also has a limited life span.
The duration of copyright for various
types of works depends on the Act of
Parliament under which the copyright
work was created. For works created
under the CDPA, the duration is
triggered by different events
depending on the nature of the work.
As the CDPA is relatively recent, none
of these works will be out of
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Continued from page 3
Moral rights
copyright yet. However, it is worth
being aware of copyright duration for
current works as this will affect their
value as archive material.
Moral rights are an important adjunct
to copyright - they protect an author's
relationship with his/her copyright
work and are to be distinguished from
the 'economic' rights conferred by
copyright. The moral rights most
relevant to archive content are the
paternity right, the integrity right and
the privacy right.
Exploitation of archive
copyright works
A copyright owner can give its
consent to a third party to exploit a
copyright work, but it is important to
ensure that the consent satisfies the
exact requirements of the proposed
use.
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Paternity right. The author of a
work must be correctly
acknowledged if he/she has
asserted this right. Often this is in
the form of an explicit statement
asserting moral rights on film
credits or the introduction to a
book. New media, with its
capability to link and copy content,
has generated a drive to present
archive content as created by the
new users. However, the paternity
right can present a stumbling block
to this. The best route is either to
obtain a waiver from the owner of
the moral right or to provide in
licence agreements for recognition
by third parties of these moral
rights.
Use of archive material today is often
very different from the initial use
contemplated when the rights were
acquired. For example, a licence
granted in 1970 to "reproduce" a
work, when it is clear that the
reproduction anticipated was for hard
copy only, may not be valid to permit
reproduction on the internet or in an
electronic database. Anyone seeking
to exploit old content on new
platforms should carefully review the
scope of the rights granted by the
original licence to ensure that the
proposed use is permitted.
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Integrity. The integrity right
prevents "derogatory treatment"
of a copyright work which would
be prejudicial to the author's
honour or reputation. The high
prevalence of advertising and other
commercial material in
combination with content on new
delivery platforms such as the
internet can cause integrity issues;
works could be distorted,
mutilated or subjected to other
forms of prejudicial treatment and
posted on websites or forwarded
by email for example. In addition,
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what is suitable for television may
not be appropriate for internet
viewing or for mobile
configuration. For some, this may
amount to certain types of editing
or compilation of the copyright
material. Integrity issues may also
arise with digital alteration of
photographs, editing film or the
digital addition of commercial
items into film or photographic
material.
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Privacy. Any use of
commissioned private and
domestic film or photographs must
be made with extreme caution.
For example, in the case of a
posthumous retrospective
exhibition of a photographer's
work, even if the photographer
had retained a copy of, and the
copyright to, privately
commissioned photographs, these
should not be exploited without
the commissioner's consent.
These moral rights are personal to the
author or the subject of a copyright
work and as such cannot be assigned
(although they do pass by will and
testament). Moral rights can only be
owned by individuals, not by
companies. It may therefore be the
case that the purchaser of a photo
archive owns the copyright in the
photographs, while the photographer
owns the moral 'paternity' right and
the private subjects of the
photographs own the moral 'privacy'
right in the same work. However,
moral rights can be waived if the
waiver is recorded in writing and
signed by the owner of the right. As
they were introduced by the CDPA,
moral rights are not a concern for
archive material developed pre-1988.
Winter 2003
Continued from page 4
Database rights
Databases are ideally suited to new
technologies. They are often the
means by which relevant material can
be located from a vast volume of
information. Many valuable archives
(e.g. press articles, film and music
catalogues, sports results) will consist
of, or be presented within, databases.
The 1996 European Council Directive
on the legal protection of databases
gave rise to a new intellectual
property right - database right.
The effect of the database right is to
award intellectual property protection
to works that may not qualify for
copyright protection owing to a lack
of originality. Database right lasts for
15 years from the date that the
database was first made available.
However, this does not automatically
mean that all databases created over
15 years ago are now free for use.
Care must be taken with databases
which are regularly updated. The
scope of database rights was
considered in British Horseracing
Board v William Hill [2001] which
concerned the legality of William Hill's
use of information taken from The
British Horseracing Board's (BHB)
database without BHB's consent.
The Court of Appeal found in BHB's
favour, stating that database right
subsisted in BHB's collection of race
information and that William Hill had
infringed that right by utilising that
information on its website, having
obtained it indirectly from BHB via a
third party. At first instance, it was
held that each time the race
information was updated, a new
database was created. The current
law therefore states that each
updated database may constitute a
new database, with the 15 year
period of protection recommencing
each time the database is updated.
This point is awaiting clarification by
the European Court of Justice.
Database right is infringed by a person
extracting or reutilising the whole or a
substantial part of the contents of the
database. In the UK, "the repeated
and systematic extraction or reutilisation of insubstantial parts of…a
database may amount to the
extraction or re-utilisation of a
substantial part of those contents".
For example, it is likely that compiling
a list of the top goals scored during
the World Cup 2002 from a database
which contained simple details of the
goals scored in each World Cup 2002
match would amount to database
right infringement. It would be a reutilisation of the original database. In
contrast, it is unlikely that this would
amount to copyright infringement as
the list of goals scored is, by definition
taken from other sources as it is
merely factual and would thus not
meet the test of originality required
for copyright.
Providing details of a single goal
scorer on request by reference to an
archive database (for example, a
search facility provided on a website
searching the archive database rather
than reproducing it) would also be
infringement even though the item of
data re-used at any one time is not
substantial compared with the
amount of data in the entire
database.
Trade marks and
passing off
Anyone wishing to use archive
material that incorporates another's
trade mark needs to give careful
consideration to whether the trade
mark owner's consent is required.
The two types of claim that a trade
mark owner may bring are: trade
mark infringement (if the mark has
been registered); and passing off
(whether or not the mark has been
registered).
Trade mark infringement
The proprietor of a registered trade
mark has exclusive rights in the mark
which can be infringed by its use in
the United Kingdom without the trade
mark owner's consent. A registered
trade mark may be infringed by use of
an identical or similar sign on goods
or services identical or similar (or in
the case of well known registered
trade marks, even dissimilar goods or
services) to those in respect of which
the trade mark is registered. Whether
use of another's trade mark on or
within archive material constitutes
trade mark infringement under the
1994 Act or passing off will depend
on how the archive material is used
and by whom.
“many valuable archives... will
consist of... databases”.
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Passing off
A trade mark owner may bring a
common law claim for "passing off"
as an alternative or in addition to a
claim for trade mark infringement.
Passing off would be relevant where
the use of archive material which
includes another's trade mark
(whether registered or not) creates a
false impression of association with
the trade mark owner's business.
The basic requirements of passing off
are:
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goodwill in the trade mark.
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a misrepresentation leading to
confusion that the goods or
services are authorised by or in
some way associated with the
trade mark owner; and
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actual damage or likelihood of
damage.
Passing off is often a greater risk
than registered trade mark
infringement for use of trade
marks within archive material.
There will be circumstances in
which the use of a mark in archive
material may amount to a
suggestion that the owner of the
mark is in some way authorising or
endorsing the goods or services of
the user of the archive material.
This is particularly so in an age
where brands offer 'lifestyle'
choices. The archive user could be
argued to be 'piggy-backing' on
the popularity of one brand to
endorse its own parallel lifestyle
message and increase the
attractiveness of its product.
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Data protection
If archive material refers to living
individuals, there may be data
protection issues.
The Data Protection Act 1998 (DPA)
imposes various obligations on "data
controllers" in respect of their
processing of "personal data".
The requirements for legitimate
processing of personal data are
detailed. The overriding obligation is
that the personal data must be
processed fairly and lawfully.
Implications for archive
material
The DPA regulates "processing" of
personal data. "Processing" is very
widely defined and covers virtually any
use (including storage) of personal
data. It is therefore highly likely that
any re-use of archive personal data will
constitute new processing and may
therefore not be legitimate under the
DPA.
“A key issue when considering
"fairness" of processing is that
of the expectation of the
individual when the data was
Of particular relevance in the context
of archive material are the data
controller's obligations to:
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process any personal data fairly and
lawfully; and
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keep the personal data up-to-date.
A key issue when considering
"fairness" of processing is that of the
expectation of the individual when the
data was collected: did he/she expect
their data to be used in this
subsequent manner? This is
particularly relevant if you are looking
collected”
to make available over the internet
personal data that was collected when
digital media distribution mechanisms
were the stuff of science fiction. Data
protection is a real concern to those
using hard copy archive material
incorporating personal data and
transferring it to the internet or other
widely accessible media for the first
time, as it is often the case that an
individual would not originally have
expected that information to be
published to the world at large.
Winter 2003
Continued from page 6
Image rights
If archive material features images of
personalities, so-called "image rights"
should be considered. Unlike in other
countries (in particular the USA,
Australia and France), in the UK there
is no legally recognised image right.
Under UK law, personalities have
effectively protected their image by
relying on an assortment of
established legal rights including
registered trade marks, the law of
passing off, copyright, privacy,
defamation, data protection and
advertising codes.
In the wake of some recent cases
involving famous personalities
(including Eddie Irvine v Talksport and
Ian Botham's dispute with Diageo
over Guinness's advertising campaign
featuring archive images of famous
sportsmen), the public is now aware
of the commercial deals between
sponsors and famous personalities. In
this context (as the judge agreed in
Talksport), it is likely that even an
archive picture of a personality may
amount to a misrepresentation, by
misleading the public into thinking
that the personality has endorsed (or
previously endorsed) the product or
service.
As the main risk in using archive
photographs of personalities is
passing off, the manner in which the
image is used is key. If an advert uses
a personality's image in such a way
that it is clear that the product is
being associated with that person's
characteristics, and not the individual
himself, then the risk of passing off is
reduced.
Hidden liabilities
Use of "current" material is often
protected in law on various public
interest grounds. However, these
defences may fall away when the
same material is reproduced in an
archive. This is of particular concern to
the press and other news reporting
industries. Defamation is an area of
potential weakness for an archive
owner, even one that is happy that its
archive collection contains the relevant
rights and permissions. This is best
illustrated by the case of Loutchansky
v Times Newspapers Ltd (No. 2)
[2001]. Loutchansky claimed The
Times had published an article
alleging that he was involved with the
Russian mafia. The article in question
had appeared in the newspaper and
also as part of The Times's online
archive.
In relation to the initial publication,
Times Newspapers relied on the
defence of qualified privilege - that is,
as it was in the public interest to
identify members of the Mafia, it had
acted with "journalistic responsibility"
in publishing the article in its
newspaper.
This defence was not available in
relation to publication of the article in
the online archive. The Court of
Appeal held that Times Newspapers
had not acted with "journalistic
responsibility" by retaining the article
in the archive after it became aware
of the defamation claim, without
attaching a notice that the veracity of
the article was disputed.
This article is based on a feature
article which first appeared in the
September 2003 issue of PLC and is
reproduced with the kind permission
of the publishers. For subscription
enquiries call 020 7202 1200 or visit
www.practicallaw.com
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Stop press
In the news...
The new Privacy and Electronic
Communications Regulations come
into effect on 11 December 2003.
They affect websites using cookie
technology and businesses that send
marketing emails or use other
electronic means and send marketing
messages.
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The Regulations impose conditions on
the use of cookies on users'
computers. Websites now have a legal
duty to notify users of the use of
cookies and must give users the
opportunity to refuse placement of
cookies on their computers.
The Regulations also implement a
'soft opt-in' regime which allows
businesses to legitimately send
unsolicited marketing material by
email provided certain conditions are
met.
The war of the chocolate giants
continues! The Kit-Kat case
(Societé Des Produits Nestlé SA v
Mars UK Ltd) has been referred to
the European Court of Justice (ECJ)
on the question of whether a mark
can acquire distinctive character as
a result of that mark being used as
part of or in conjunction with
another mark. Nestlé has for
many years owned registered trade
marks for the general slogan
"Have a break … have a Kit-Kat"
and KIT-KAT. However, its latest
attempt to register HAVE A BREAK
as a trade mark was successfully
opposed by Mars. The Court of
Appeal held that the mark HAVE A
BREAK was devoid of distinctive
character, but referred the
question of acquired distinctiveness
to the ECJ. We await the ECJ's
decision with interest.
If you operate a website or market
your products/services by email,
telephone, SMS or fax you should
ensure that your privacy policy and
marketing practices comply with the
Regulations. Failure to do so may be a
criminal offence under the Data
Protection Act 1998.
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Who to contact
Nicholson Graham & Jones
110 Cannon Street, London EC4N 6AR
020 7648 9000
For further information contact
Peter McBride, Dominic Bray,
or Rachel Boothroyd
peter.mcbride@ngj.co.uk
dominic.bray@ngj.co.uk
rachel.boothroyd@ngj.co.uk
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The European Parliament has
finally adopted its long-awaited
Resolution on a proposed directive
on the patentability of "computerimplemented inventions". Whilst
this should come as some relief to
patent lawyers, there is still an
element of uncertainty as the
definition of "computer-
Internationally a member of GlobaLex
The contents of these notes have been
gathered from various sources. You
should take advice before acting on any
material covered in ip news.
implemented invention" in the
version adopted by the Resolution
is somewhat narrow. Despite
heated debate in Europe over this
issue and the more liberal
approach adopted in the US, the
definition defers to the European
Patent Convention which states
that software is not patentable.
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The Copyright and Related Rights
Regulations 2003 came into force
on 31 October 2003. These
Regulations focus on changes to
update copyright law in today’s
information society. They include
provisions relating to digital
broadcasting of works and ondemand services. Key changes
include:
improved criminal sanctions and
civil remedies relating to copyright
infringement;
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a new "making available right"
for performers to control ondemand transmissions of their
performances; and
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new provisions to tackle the
circumvention of technological
protection measures.
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© Nicholson Graham & Jones 2003