By Vicki Huang
The Fordham IP conference – “Learn, Debate, Have Fun” – was held on 28 – 29th April 2011 in New York City. The conference attracted many academics, practitioners, government officials, and members of the judiciary from Europe, the USA and of course Australasia. This combination triggered a lot of informed debate and it was refreshing to hear input from all sides of contentious issues including views from the bench.
Many of the sessions have been covered by our friends at IPKAT here, here, here, here, here and here. In addition to those sessions, the Fortnightly Review was lucky to attend several specific sessions on copyright and trade mark law and highlights are outlined below.
In a session on “US Copyright Developments”, Thomas Kjellberg updated the audience on copyright cases against “suburban” downloaders where damages peaked at over $1 million dollars. These cases such as Capital Records v Thomas Rassett have sparked a debate as to whether such awards violate due process. Kjellberg also discussed the case of Penguin v American Buddha. In that case, American Buddha (a religious not-for-profit), posted ebooks on its website. One of the issues for the court was locating the site of the injury. Was it in New York (home of the plaintiff), or Arizona (the site of the uploader) or Texas (the site of the server)? The court held that because the location of the infringer may be remote, it would not be fair to use the infringer’s location as the locus of harm. Therefore, even though there was no downloading evidence in New York, that was not to say there was “no injury” in New York. Rather the test should assess the intent of the infringer.
In a session on “EU and US Initial Interest Confusion in Trade Mark Law”, The Hon. Mr Justice Arnold discussed the development of the doctrine and its actionability under Article 9(1)(b). He went on to discuss several cases including the recent case of Och-Ziff Management Europe Ltd. Daniel Glazer discussed US developments with a focus on the expansion of the doctrine to the internet, where trademarks are used in domain names or in meta tags or keywords. The panel discussed the fine line between confusion and diversion and the fact that US courts are really trying to protect senior mark good will and against unfair competition. The panel debated what was permissible and indeed healthy free riding. They also debated the merits of using the initial interest confusion doctrine to police domain names. The panel agreed that in the current era, consumers are used to deceitful metatags and more wary of commercialised hyperlinks so confusion is a lot less likely. Professor Anne Bartow argued that one can no longer assume that consumers are unsophisticated. She went on to query whether the law should remedy a situation where there is confusion that is cured before the point of sale.
In a session discussing dilution Law in the European Union & the United States, Trevor Cook (Bird and Bird) began with a discussion of the EU’s approach. He noted the over-intellectualisation of simple legal tests which was a common complaint in several other panels. Professor Marshall Leaffer discussed US developments in dilution and the case of Visa v JSL Corp. In that case, Professor Leafer argued that the question of likelihood of confusion – which is a question of fact – was approached in a fast and loose manner. He also said that the case highlighted that the evidence required to prove a dilution case was very unclear. A European speaker helpfully reminded the audience that reconciling EU and US policy and legal approaches was not simple as there is no unfair competition law in the UK and some other EU states.
The well-attended sunrise seminar on “Rule of Law on the Internet: Feasible or Fantasy”, started with views from Richard Cotton of NBC Universal Media. He stated that the question was not “whether” we should have a rule of law on the internet, but rather “when” and “how”. He discussed a fundamental problem being one of attitude, with many downloaders thinking that “if it’s so easy to pirate, it can’t be wrong”. Piracy is moving from being treated as a nuisance, to a problem that the FBI and homeland security are now enforcing against.
In terms of legitimizing tools, he discussed the development of ancillary markets and goods such as Netflix, and Xbox live which are robust and legitimate markets that rely on internet streaming technologies. In his view, encouragement of these delivery models will give illegal downloaders a legitimate alternative. However, he emphasised that the challenge will be to create a culture that will accept copyright piracy as a wrong and likened this to being a parent training a recalcitrant child.
Justice Peter Charleton commented that the EU has compulsory anonymity on internet. And that a cultural problem was that anti-globalism is a big movement so that theft from “anonymous capitalist” was thought to be ok. The panel agreed that IP theft was like drug addiction where demand generates supply.
In the session, “Enforcement Issues Including New Government Initiatives”, Stevan Mitchell (the ESA) and Peter Fowler (USPTO Enforcement) discussed the extent of the enforcement problem. Twenty five per cent of all internet traffic globally involves unauthorized distribution of copyright files. One assessment had 43 illegal downloading websites register 146 million hits per day. Bottom line is that there is a huge appetite for TV and film downloading. Peter Fowler emphasised the need for cultural change akin to the shift that led to seatbelt wearing. He also discussed the US “Operation in our Sites” which had been seizing domain names of illegal download sites. He emphasized that the academic debate over whether creative adaptations should be free was moot as copyright infringement is illegal and a crime. For enforcement officers there was no debate. He also highlighted a shift in counterfeiting. Counterfeiters are now trying to make higher profits by making goods as close as possible to the real luxury item and selling goods on deceptive websites at matching prices (as opposed to a severely discounted price that would indicate a “fake”) in order the maximise profits.
Other paths of enforcement include cooperative agreements between registries to seize domain names. Importantly it is also to target 3rd party providers eg agents for service and paypal. If money supply can be cut off, then enforcement agencies will try to do so.
In the session “Trademark Law: Smell and Look-a-likes: a Comparative Analysis” Anna Carboni presented an update on smell and look alike cases including the controversial L’Oreal v Bellure case. Carboni highlighted the fact that the British Brands study showed the customers can be easily confused by look alike packaging. The panel including Robert Burrell pointed out that surveys used in the British Brands study and other surveys used to support a senior mark owner are flawed due to the prevalence of leading questions. On another point, Jane Ginsburg re-emphasised that “lured” does not mean confused. Consumers learn for example, that supermarket shelves are stocked with similar looking house brands. The Hon. Justice Robin Jacobs agreed saying that judges shop and are also aware of brand generics. The question should be whether reasonable customers are likely to be confused and whether the company intended to confuse consumers. Justice Jacobs observed that brand owners are now scared to sue “home brands” which are put out by supermarkets because supermarkets may retaliate and not stock the senior brand.
In the session “Adwords: a Comparative Analysis” Professor Marshall Leaffer discussed the proposition that after the case of Rescue.com, selling trademarks as keywords is “use in commerce” and subject to the Lanham Act. Professor Barton Beebe discussed the increase in consumer sophistication and that the legal question had moved on from “use” to “likelihood of confusion” and in the future will be preoccupied with predicting levels of consumer sophistication.
Prof. Dr. Peter Ruess presented a convincing case for protection of well-known brands. Interestingly calling it naïve to use the phrase “comparative advertising” in cases that were clearly “bait and switch”. The panel seemed divided on the line between “genuine” comparative advertising and the misappropriation of goodwill. Ruess argued that using the goodwill of a senior mark to lure a customer is not comparative advertising and is not in the public interest. Professor Beebe argued that encouraging free competition is in the public interest. The panel seemed divided between recognising the property rights of high investing brand owners and free competition.
Vicki Huang is a Research Associate with IPRIA and a Lecturer at Deakin Law School