This week in IP: counsel split on TM reform, Lidl stumbles against Hendrick’s gin, Huawei IP chief leaves role

Counsel are divided over whether the USPTO’s proposed guidelines on the Trademark Modernization Act could deter bad actors from abusing it, Managing IP reported yesterday, May 27.

The act, which was passed in December 2020 and will go into effect in December 2021, was enacted to help clear the registry of marks not being used in commerce.

The pending guidelines, ‘Changes To Implement Provisions of the Trademark Modernization Act of 2020’, were published on May 18. They set out how the USPTO would oversee the act’s new ex-parte expungement and ex-parte re-examination proceedings, which are designed to make it easier for third parties to cancel marks that aren’t being used.

Brett Heavner, partner at Finnegan in Washington DC, says the goal of these regulations seems to be to discourage bad actors from targeting innocent brands with the new TMA proceedings. “It’s really comforting to know that someone can’t just start the procedure without having done some real homework.”

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A Scottish judge ruled on Tuesday, May 25, that supermarket brand Lidl had infringed a trademark for the Hendrick’s gin bottle in one of its own-brand products. 

Lord Clark at Edinburgh’s Court of Session saidLidl had intended to benefit from the reputation and goodwill of the Hendrick’s mark, which protects the shape of the bottle, when redesigning the Hampstead bottle and label in 2020.

“It is difficult to view the redesign, including the change in colour of the bottle, as accidental or coincidental,” he found, issuing an injunction against Lidl in Scotland.

Though the Hendrick’s trademark is not limited to any colour, the gin is sold in a dark bottle with a pale diamond-shaped label. In the 2020 rebrand, 10 years after Hampstead gin came on sale, Lidl changed several features including the shape and colour of the bottle and the colour of the label.

William Grant & Sons, the owner of Hendrick’s, said the redesigned version contained several changes that simply could not have been accidental – and sued for trademark infringement and passing off.

“The re-designed version was in a darker colour of bottle, replicating the famous dark brown-black colour used as part of the get-up of Hendrick’s gin,” a company spokesperson said. “It includes images of cucumbers which allude to the fact that Hendrick’s gin is famous for being typically, and unusually for a gin, served with cucumber.”

Lidl countered that there were numerous distinguishing features including that the Hampstead label was narrower and that the shape of the bottle neck was markedly different.

Despite dismissing the passing off claims, Clark ultimately found in favour of William Grant & Sons under Section 10(3) of the Trade Marks Act, which prevents unauthorised trademark use.

“Whether or not there was a deliberate intention to deceive, there is a sufficient basis for showing that there was an intention to benefit,” he said, adding that Lidl had been riding on the coattails of the Hendrick’s mark to benefit from its attraction.

As the ruling only applies to Scotland, it means Hampstead gin products available in England and Wales (where they are also sold) are unaffected. 

Lidl’s defeat comes just a month after rival budget supermarket Aldi was sued in a high-profile dispute with retailer Marks & Spencer (M&S). The case centres on whether Cuthbert the Caterpillar, a chocolate cake sold by Aldi, infringes the trademarks of M&S’s Colin the Caterpillar.

Jason Ding is leaving his role as head of intellectual property for Huawei, it was announcedon Monday, May 24.

Ding, who has led Huawei’s corporate IP department for the past 15 years, will take up a new role at the Chinese telecoms company as general counsel of Huawei Digital Power, an affiliate focused on smart energy.

The announcement comes just over two months after Ding revealed that Huawei would start charging smartphone makers royalty fees for using its patented 5G technologies at a live event in Shenzhen.

Ding, who has appeared in Managing IP’s corporate stars list on more than one occasion, estimated at the time that Huawei should bring in between $1.2 billion and $1.3 billion from its overall licensing fees, including those announced in March, between 2019 and 2021.

It has yet to be announced who will replace Ding as Huawei’s IP chief.

Almost half of the most protected brands in the world are owned by Europe-based companies, according to a new report called Top 100 Best Protected Global Brands from Clarivate Analytics.

To create the list, which was publishedon Wednesday, May 26, Clarivate measured brand strength through an analysis of advanced and unified IP data, including trademark information, global case law and digital domain name protection.

It found that 49 of the best-protected brands came from European countries including Germany (14), Switzerland (eight) and the UK (seven).

These brands included Bosch (Germany), GSK (UK) and Marlboro (Switzerland). Consumer brands made up most of the list (51%).

Jeff Roy, president of the IP group at Clarivate, said: “Our very first Best Protected Global Brands report honours businesses that have created powerful identities. Their brand stewards recognise the pivotal role IP plays in supporting business strategies and delivering long-term value.”

Some of the companies on the list that were found to have more than one best-protected brand were Google (which owns the Google and YouTube brands), BMW (which also owns the iconic British car brand Mini) and Coca-Cola (which has Fanta).

The US Court of Appeals for the Federal Circuit has affirmed victory for Microsoft, Samsung and Google in their battle against patent owner Iron Oak Technologies.

In a rulingon Monday, May 24, three judges upheld decisions from the Patent Trial and Appeal Board (PTAB) to invalidate one claim of a patent called "System and method for remote patching of operating code located in a mobile unit".

After Microsoft, Samsung and Google filed inter partes reviews against claim one of the patent, US number 5,699,275, the PTAB found it unpatentable over the prior art.

At the Federal Circuit, Iron Oak challenged the PTAB’s claim construction as well as its findings on anticipation and obviousness.

However, Judges Alan Lourie, Haldane Mayer and Kathleen O’Malley (who wrote the opinion) dismissed Iron Oak’s appeal on claim construction and anticipation, and said it was unnecessary to review the obviousness arguments in light of that dismissal.

The ruling represents a win for three of the world’s biggest tech companies, but is a non-precedential judgment.

US Senator Chris Coons has claimed that President Biden gave him authority to pick the next director of the USPTO in exchange for remaining in the Senate, it was reported in The American Prospect on Monday, May 24.

The Biden administration has yet to nominate a USPTO director, but if Coons does indeed have this reported sway over the pick, the person who fills that role will likely be more pro-patent than some industry and private practice onlookers might have feared.

The Delaware senator, whom Politico dubbed "the Biden whisperer" last year, was the chair of the Senate Judiciary Subcommittee on IP, and was reported to be a potential candidate for secretary of state until Antony Blinken was picked.

He is known for being a proponent of strong IP rights.

In a letter to Biden dated February 10, Coons outlined four criteria for the next USPTO director which included an understanding “that clear, predictable, and enforceable intellectual property protections drive economic growth, foster entrepreneurship, create jobs, and improve our quality of life”.

He also requested that the director be committed to diversity and inclusion, and have real-world experience litigating IP.

Until a new director is chosen, Drew Hirschfeld is performing the duties of the under secretary of commerce for IP and director of the USPTO.

The US Supreme Court declined to review a case that added researchers Gordon Freeman and Clive Wood as inventors to Ono Pharmaceutical’s cancer-treatment patents on Monday, May 24, upholding a 2020 decision from the US Court of Appeals for the Federal Circuit.

As previously covered by Managing IP, the Federal Circuit ruled that Ono’s arguments that early-stage researchers shouldn’t necessarily be registered as inventors if they did not participate in end-stage testing had set out an “unnecessarily heightened inventorship standard”.

In its petition for certiorari, Ono said the Federal Circuit had adopted a bright-line rule in its judgment in Ono v Dana-Farber that what made an invention patentable was not relevant in determining whether an individual was an inventor.

It also argued that this rule created a circuit split with the US Court of Appeals for the Fourth Circuit and that it conflicted with background principals of patent law.

“This case presents an important question because the Federal Circuit’s bright-line rule will undermine collaboration and create windfalls for individuals who contributed only ideas that are already covered by prior art,” it said.

In its reply brief, the Dana-Farber Cancer Institute argued that the Federal Circuit did not create a bright-line rule for assessing inventorship evidence and that the ruling did not conflict with Fourth Circuit precedent.

It also disagreed with the petitioner’s claim that the decision would deliver windfalls. 

The cancer patents in question arose from Tasuku Honjo’s Nobel Prize-winning discovery of an inhibitory receptor on T-cells, called PD-1, which operates to inhibit T-cell activity when it binds to one of its ligands such as PD-L1 or PD-L2.

Honjo collaborated with Wood and Freeman throughout the 1990s to explore the role of PD-1 in the immune system. Among other contributions, Freeman and Wood discovered the PD-L1 ligand, that PD-1/PD-L1 binding inhibited the immune response, and that anti-PD-1 and anti-PD-L1 antibodies could block the pathway’s inhibitory signal.

In the first-instance ruling in 2019, the District Court for the District of Massachusetts also sided with the Dana-Farber Cancer Institute and ruled that Freeman and Wood should be added as inventors.

The EPO has revoked a foundational CRISPR patent owned by UC Berkeley following oral proceedings at the office on April 12 and 13, it emerged this week.

The university’s EP3241902 patent, called "Methods and compositions for RNA-directed target DNA modification and for RNA-directed modulation of transcription", was invalidated in its entirety last month on the basis of an invalid priority claim.

This invalidation represents the first big loss of UC Berkeley’s CRISPR patent rights in Europe.

While the written decision from the EPO’s Opposition Division has not yet been published, preliminary non-binding opinions from the division cited a key 2012 publication from the university, referred to as Jinek 2012, as potentially relevant prior art.

This prior art, the division suggested, supported the revocation of the patent on the basis of a lack of inventive step under Article 56 in the European Patent Convention.

This is the second time a core CRISPR patent has been invalidated by the EPO over the past six months. The Broad Institute’s EP2771468 CRISPR patent, called "Engineering of systems, methods and optimised guide compositions for sequence manipulation", was revoked in November 2020.