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This week in IP: UK exhaustion review ‘concerning’, EU legislator backs COVID waiver, Senate passes trade secrets bill

Managing IP rounds up the latest patent, trademark and copyright news, including some stories you might have missed

UK exhaustion review concerns IP owners

In-house and private practice sources told Managing IP this week that they were concerned about the UK government’s launch of a consultation to collect industry views on the future regime for intellectual property exhaustion.

In the consultation published on Monday, June 7, the government outlined four options it said could work as viable alternatives to the current EU-linked system for a post-Brexit scheme.

Sources say they’re worried that the government will settle on an unfavourable option of international exhaustion, whereby UK-based companies would have limited control over sales abroad, may be chosen.

Catriona Stevenson, general counsel at the Publishers Association in London, says she is “incredibly concerned” at the potential damage to the domestic UK market for authors if this option is pursued.

“International exhaustion would prevent authors and publishers from relying on copyright to prevent parallel imports of books into the UK, damaging the domestic market,” Stevenson says.

Click here to read the full article.

Other Managing IP stories published this week that you may have missed include:

Why changes to China’s design patent law are a big deal

Semiconductor in-house speak out on top IP concerns

Tech Companies unpick best FTO strategies

In-house: counterfeiters increasingly targeting unregistered IP

Washington NPE case intriguing but 'not big deal' for tech counsel

Autonomous cars and EVs driving IP strategy shift, say in-house

Brands question merits of early-stage trademark validity rulings

EU Parliament backs COVID waiver

The European Parliament urged the European Commission to reverse its position on the COVID waiver on Wednesday, June 9, and support the temporary lifting of intellectual property (IP) rights for COVID vaccines.

EU MEPs backed a resolution by 355 votes to 263 supports waiving patents for vaccines, the parliament announced on Thursday.

The European Commission had presented a plan to the World Trade Organization on Friday, June 4, as an alternative to the sweeping IP waiver for COVID vaccines and other therapies first proposed by India and South Africa in October 2020.

The plan focused on limiting export restrictions and making use of the so-called TRIPS flexibilities that allow countries to bypass IP restrictions.

The commission’s plan also encouraged pharma companies to make licensing deals with vaccine producers in low-income countries and to pledge to increase the supply of doses.

The EU and Switzerland are home to many multinational pharmaceutical companies, which have voiced concerns that lifting IP will not increase access to vaccines.

In a surprise move in May, US president Joe Biden voiced support for an IP waiver, but only for vaccines.

US Senate fights trade secret theft with new bill

The US Senate passed a new bill on Tuesday, June 8, to strengthen US innovation and manufacturing and counter China’s influence. The US Innovation and Competition Act contains several provisions aimed at preventing foreign trade secret theft.

The bill includes a requirement that every six months the president should impose at least five sanctions on foreign entities engaged in trade secret theft that poses a significant threat US national security, foreign policy, economic health or financial stability.

Potential sanctions include directing the Export-Import Bank of the US not to approve any loans to chosen entities and blocking US financial institutions from making loans greater than $10 million to them in any 12-month period (unless the loans are intended for activities that would relieve human suffering).  

This provision was originally part of the Protecting American Intellectual Property Act, which Republican Senator Ben Sasse and Democratic Senator Chris Van Hollen reintroduced in April 2021.

In a statement, Van Hollen said the US Innovation and Competition Act would help boost innovation and grow jobs across the country, while curtailing trade secret theft.

“I was proud to author a number of measures within this package – including provisions to prevent the theft of key US technologies and identify the most important challenges in science and technology that we must tackle. I urge our house colleagues to take this critical legislation up swiftly,” he said.

The Innovation and Competition Act will now go to the House of Representatives. It is unclear when or whether it will pass, but President Joe Biden has expressed support for the bill.

SCOTUS denies cert on Comcast's petition

The US Supreme Court denied Comcast’s petition for writ of certiorari in Comcast v PromptuSystems on Monday, June 7.

On February 26, Comcast asked the court to take up the question of whether administrative patent judges are principal or inferior officers of the US.

It requested that its petition be held pending the disposition of Supreme Court case Arthrex v Smith & Nephew, which is examining the same question.

It said that if the court ruled that administrative patent judges were inferior officers, then it should deny cert.

The US Supreme Court has not yet ruled on Arthrex, but is expected by many to do so before July 4.

When Comcast argued its case at the Court of Appeals for the Federal Circuit, it presented an appointments clause challenge and asked the court to vacate the Patent Trial and Appeal Board’s previous decision and remand in light of Arthrex.

But the Federal Circuit did not address this issue.

In Comcast’s petition for cert, it argued that the Federal Circuit should have addressed its appointments clause challenge and that the court erred in failing to vacate and remand the PTAB decisions under Arthrex.

On May 3, acting solicitor general Elizabeth Prelogar filed a reply brief for the federal respondent and said Comcast’s arguments were unsound. Promptu Systems did not submit a reply brief, however.

Crocs snaps at Skechers and others in ITC trademark claim

Shoe company Crocs has this week filed a complaint at the US International Trade Commission against Skechers and several other companies.

In a complaint filed on Monday, June 7, Crocs says it is seeking to block the importation and sale of products into the US that infringe its trademark rights.

“We pride ourselves in creating iconic products that are distinctly Crocs and this decisive action further demonstrates our commitment to protecting our brand, our trademarks and other intellectual property," said Crocs chief executive Andrew Rees in a statement.

Rees added: “By blocking the importation and sale of trademark-infringing footwear, we can ensure with confidence that our product DNA is fully protected while continuing to provide an authentically Crocs experience to our customers and consumers.”

The latest complaint follows a 2006 request by Crocs with the ITC relating to its design and utility patent rights for the Crocs classic clog. That action resulted in the ITC issuing a general exclusion order barring the importation of products infringing its rights.

At the INTA Annual Meeting last year, Heike Bhonsle, brand protection director at Crocs, revealed that a major surge in online shopping – as a result of stay-at-home orders during the pandemic – had sparked an “influx of copycat websites trying to impersonate our brand.”

Chinese court upholds $1.4m award for L’Occitane

A Chinese court has upheld a lower court ruling that awarded French toiletries company L’Occitane 9 million RMB ($1.4 million), following a trademark infringement and unfair competition case.

In the judgment published on Monday, June 7, the Zhejiang Higher People’s Court found that the original damages award determined by the Intermediate People’s Court of Hangzhou should be affirmed. 

L’Occitane had sued Chinese-based Zhejiang Junda Biotechnology Development and Guangzhou Ailian Cosmetics in 2019 for selling a product called Andorheal Fragrance Body Lotion.

The lotion was sold in a bottle shaped and designed in a similar way to L’Occitane’s Cherry Blossom Shimmered Lotion.

At first instance, the Hangzhou court found that Junda and Ailian had committed trademark infringement and breached unfair competition rules.

The Andorheal product, according to the first instance court, looked very similar to the L’Occitane product because of the shape of the bottle and use of a cherry blossom motif, for which L’Occitane had registered a trademark in 2016.

Junda was ordered to pay 3 million RMB in damages and Ailian 6 million RMB. The two companies refused to accept the judgment and appealed against the finding.

However, on appeal, the Zhejiang court held that the shape and size of the Chinese companies’ lotion, as well as the patterns of the cherry blossoms, were similar to L’Occitane’s product.

According to the court, Junda and Ailian knew that the L’Occitane cherry blossom products were well-known and abused L’Occitane’s goodwill. 

Frito-Lay wins savoury victory in ‘pretzel-crisp’ trademark dispute

A 12-year trademark battle over the term ‘pretzel-crisp’ came to an end last Friday, June 4, when a US district court judge ruled in favour of Frito-Lay and held that Snyder's of Hanover could not monopolise the generic snack term.

Judge Kenneth Bell of the District Court for the Western District of North Carolina ruled that while the term ‘pretzel-snacks’ was widely viewed by consumers as referring to the specific product made by Snyder’s, the food producer could not “monopolise the common name”.

Bell wrote: “The court finds that the combination of the acknowledged generic elements of the compound mark yields no additional meaning to consumers capable of distinguishing the goods.

“Independently, usage by competitors, media references and consumer surveys reflects that, on balance, consumers primarily perceive “pretzel crisps” to be a common or generic name.”

The case began in 2009 when Princeton Vanguard – which was bought by Snyder’s in 2012 – applied for a federal trademark for its flat pretzel snack on the principal register.

Frito-Lay, which makes Rold Gold pretzels, challenged the trademark, arguing that the term ‘pretzel snacks’ is a generic term for a type of pretzel.

Three federal appeals courts have ruled that the mark is generic, including Court of Appeals for the Fourth Circuit most recently in March 2021.

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