Despite the fact that Gabriela Kennedy holds a dual practice qualification in England and Wales, she has always practised in Hong Kong. “I married a guy who got a job in Hong Kong…and it worked out!” Almost 20 years on, Kennedy heads Mayer Brown JSM’s IP and TMT team in Asia after time spent “focusing on IT matters, transactional IP and IP litigation” at another international law firm.
Before entering the IP profession, Kennedy studied literature and theoretical linguistics at university and dreamt of becoming “the next great novelist”. After working as a theoretical linguist, she ended up in intellectual property: “Of course, there you deal with copyright, patents, trade marks and the creative output of the mind,” she says. “I found it very fascinating. I could not believe that somebody was paying me to do something that was so exciting. I would have done it for free and then I thought – better not tell them!”
E-commerce in China
Kennedy speaks several European languages including English, French, Romanian, Portuguese and Spanish. Her portfolio of work is as varied as her language abilities. Day to day, Kennedy handles matters ranging from copyright to data privacy. She is broadly experienced in TMT and helping clients to navigate China’s unrivalled e-commerce market. Over the last year, it is reported that the worth of retail e-commerce market in China grew by 25%. In 2016, it was found that over 1 billion people in China were connected to the internet.
In December 2016, the first draft of China’s e-commerce law was issued for public comment. The draft included guidelines for online businesses operating in China and those attracting Chinese custom. Guidelines on the exchange were proposed in the draft law. It is said that the law could be enacted by the end of this year. While the draft focused on regulating e-commerce activities and trading online, the public consultations reflected concerns that the new proposals could water down the responsibilities of online vendors.
Speaking on the proposals, Kennedy says: “It’s lots of regulation and it’s difficult because we have some very good domestic e-commerce players, but they sense that there is an effort to push out the foreign players and make it a domestic playing field.” Could this work in favour of domestic business owners? Kennedy says: “It’s tricky, because if you want to be an island on your own, then that’s fine. If you want to play in the global arena, you have to give and take.”
In recent conversations with her clients, Kennedy says: “We are talking about the regulatory changes that all financial institutions are facing at the moment, the opportunities presented by blockchain and the threats that arrive with the emergence of huge data specs that everybody has to deal with.”
“We do a lot of e-commerce deals which are peculiar and different, because they are flavoured by particular national, restrictive requirements that have come in over last two years.” Kennedy names restrictions on virtual private network (VPNs), application stores, social media use and allocation of domain names among the “myriad of issues” faced by her clients.
In spite of such challenges and perceptions that it is a high-risk business environment, China continues to attract investors from all over the world. Kennedy says: “That is a perception that has existed for ages - that it is the Wild, Wild East and to a certain extent, it was justified in the early 1990s when you had the emergence of IP legislation in China. Let’s not forget that this country didn’t have proper IP legislation until then. Since then, China has updated its legislation to follow international convention…probably more than Hong Kong has.”
Protecting your IP in China
The early stages of IP litigation can be “mind-numbingly bureaucratic” as China’s court system is unique: “The whole process of litigation after the initial hurdle of actually getting the process started is much faster than it can be in other places, including the UK and Hong Kong. When you get your judgment, your day in court the process is so much shorter. There is more done on paper and presented by experts than witnesses.” In IP enforcement, the process “can be quite infuriating because you’re dealing with quite sophisticated people who might disappear and dissipate the assets in the company”.
“It’s very difficult to then get your money out of China. That’s why people get so frustrated with China.” She hastens to add: “But saying that, a number of companies have had successes. It’s about devising strategies that are sensible and having the same power in terms of implementing your strategy. It’s one thing to come up with a strategy but it’s another to actually focus on implementing it.”
Start-ups are “very focused on developing the product” and “caught up in that excitement", says Kennedy. “With start-ups, it is very difficult because they only realise the value of IP at the moment when they need to get some funding. The first thing potential investor will ask is: We would like to see your IP and understand whether it is clean and protected. This is where they are like little rabbits in the headlights.”
Trade mark protection
Three years ago, the Supreme People's Court issued a first draft of a new trade mark law. The final provisions were approved in 2016 and the Supreme People's Court released its interpretations on the trade mark provisions earlier this year. These included recognition of prior rights and new rights for figures of public interest to contest trade marks which could be deemed to have an “adverse effect”.
In spite of new efforts to curb bad faith applications, it is still commonplace for brand owners’ marks to co-exist with those filed by squatters: “If you’re launching the product, wherever you are in the world and you have not filed in China, you have an 85% to 90% chance of your mark being hijacked in China.”
“If you are launching a new product or service, somebody will spot it. Because of the way news circulates these days, they will notice that you have not filed. They will file, sit there and wait until a time comes when you can sit at the table and offer to buy them out,” Kennedy says.
She also observes, when companies fail to conduct thorough audits of their assets and file strategically, they are exposed to “dilution and confusion in the market”. She advises her clients to “be flexible … to revisit the strategy”.
International clients may appear reluctant to adopt this belt and braces approach to IP protection: “I think the problem is that a lot of clients are reactive rather than proactive and there’s a reason why they behave that way: it’s not because they don’t want to do it; they are constrained by the budgets they have and the power they have to direct such strategy.”
Data and technology
Aside from her IP practice, Kennedy works closely with businesses in the TMT sector: “Increasingly we are seeing more conversations about data ownership which is very interesting - that’s where I think the interplay with IP appears.” The true definition of data, in particular, is something that practitioners and clients are exploring.
In commercial cases about data ownership, this often increases time spent in negotiation - “a negative thing", says Kennedy: “You can see why, you can see the motivation for it but of course as a lawyer, you are trying to define it [data] because unless you define it precisely, you are going to have an argument down the line.” Regardless of whether the term is in the contract or not, hindrances occur “because nobody quite knows what you’re talking about”. “Data - well it's like the old definitions of the ‘know-how’.”
Beyond the legal definition of data, there is much more to consider: “Personal data is a tiny subset of the data that we are talking about these days.” As several companies have come to realise, “they are sitting on unexploited assets, which are the data sets that they are generating from their day-to-day operations”.
“Of course, you have the internal dataset that you generate within your own company and then you have the dataset that you generate as a multinational business, which includes your interchange with your business partners, so at that point - who owns the data?” From an IP point of view, Kennedy suggests it’s worth considering “content that attracts copyright protection” and statutes that define “joint IP as something that is jointly created and with equal effort put in by the party”. She adds: “You can see how we’re going to have some disputes over time.”
Success and gender equality
A recipient of numerous awards for distinction in TMT and IP practice, Kennedy says: “Of late, I’ve enjoyed very much mentoring a younger generation of lawyers. I’m hoping that I can impart some of the knowledge that I have acquired over my career … particularly as a woman in a profession that is largely, at the top, dominated by the other gender at the top echelons of power.”
As a board member of the International Women’s Forum, Kennedy says: “Anything to do with leadership for women is at the forefront of my thoughts.” Kennedy established the In the Know network at Mayer Brown JSM, “a business development tool and networking platform” targeting professional women, something she has found “most rewarding”: “There are so many people in the firm that come to me and say they enjoy the events. Many of my male colleagues are now on our list for In The Know events!”
While Kennedy sees the “motivation” for women only events, she says: “I think we need to move away from just having awards for women.” In the Know provides “a non-threatening environment” for women, Kennedy says, “for the simple reason that women don’t have the same business opportunities that men have and they are a bit more reticent about getting out there.”
“It is true that there are more women entering the law than men but you see, even with my network, I’m not closing it and saying it’s only for women.”
She adds: “When I’m mentoring, I don’t make any distinction between men or women, but in my group, it so happens that I have mostly women. Most of the people I have mentored are women and I’m always looking for ways in which I can inspire and motivate them and show them that actually, it’s not that difficult to succeed.”