EU takes action against cyber-enabled ‘IP theft’ perpetrated from outside the EU

In the first EU measure of its type, Council Regulation (EU) 2019/796 concerning restrictive measures against cyberattacks threatening the Union or its Member States [17th May 2019] contains targeted sanctions against online “external threats” to IP. This Regulation is aimed at threats which originate from outside the EU, use infrastructure from outside the EU, or otherwise the person(s) instrumental in such a cyberattack are established abroad (Article 1).

Amongst other criteria, Article 2 of the Regulation targets an actual or attempted cyberattack on IP which has a, potentially, “significant effect”, on the “loss of commercially sensitive data”. Such commercially sensitive data will fall within the definition of a ‘trade secret’ under Council Directive (EU) 2016/943 on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure [8 June 2016] if that data: 1. is secret in the sense that it is not, as a body or in the precise configuration and assembly of its components, generally known among or readily accessible to persons within the circles that normally deal with the kind of information in question; 2. has commercial value because it is secret; 3. has been subject to reasonable steps under the circumstances, by the person lawfully in control of the information, to keep it secret.

Article 3 of this new Regulation imposes an asset freeze on natural or legal persons, entities or bodies who are responsible for the actual or attempted cyberattack; provide financial, technical or material support for or are otherwise involved in the cyberattack; or are associated with the natural or legal person, or bodies involved. As a result of such an asset freeze, all funds and economic resources belonging to, or controlled by, such listed persons and that fall under EU jurisdiction (e.g. held by EU banks) will be frozen. In addition, no funds or economic resources may be made available to or for the benefit of the said listed person by parties falling under EU jurisdiction.

This latest EU Regulation should serve to remind us that the “big international question” of cyberspace governance still remains to be resolved, albeit Sir Mark Sedwill (Cabinet Secretary, Head of the UK Civil Service and UK National Security Advisor) would note that the major private sector providers are more receptive than ever to its resolution (see Public Accounts Committee Oral evidence: Cyber Security in the UK, HC 1745 [1st April 2019] Q93).

In his article Jurisdiction In Cyberspace: A Theory of International Spaces Darrel Menthe asserts that, “unless it is conceived of as an international space, cyberspace takes all of the traditional principles of conflicts-of-law and reduces them to absurdity.” Akin to the “law of the flag” on the high seas, nationality of a vessel (manned or unmanned) in outer space or the nationality of the base in Antarctica, Menthe advocates, even in the absence of such a sui generis treaty regime as regulates the other three international spaces, that jurisdictional analysis requires cyberspace should be treated as a fourth international space governed by a comparable set of default legal rules (see Darrel Menthe, Jurisdiction In Cyberspace: A Theory of International Spaces 4 MICH.TELECOMM.TECH.L.REV 69 (1998)).

Copyright and Trademarks

Copyright

In interesting thought for next time you go out to a music venue: unless the proprietor has a license from the PRS (Performing Rights Society)  future visits may be suddenly curtailed. A recent decision relating to the “Twisted Fix Nightclub ” in Stroud, Gloucestershire means that the owner of the nightclub, who did not have a PRS license, must pay £3,000 in fines and can no longer play any music until all fees have been paid and his license is brought up to date. Failure to do so will result in fines of up to £10,000 and 6 months in jail…

Trademarks

The world of trade mark disputes has reached Barry Island. Entertainments Group – who are the trade mark owners of the mark London Eye – has spied that the mark Barry Eye is being used on the Ferris wheel at Barry Island. The lawyers for the owners of the London Eye brand claim that anyone seeing the Barry Eye will link it with the London Eye. The owners of the attraction at Barry however claim that the Barry Eye is not their official name and is simply one that has been adopted by locals so they are not liable for any linkage and are taking advice ….one to follow.

Posted on behlaf of Sue Radcliffe

Moral prejudice compensation for sufferers of IP infringement.

The CJEU has given a decision today under Decision Liffers C- 99/15 that when judicial authorities set damages for IP infringement they will “take into account all appropriate aspects, such as negative economic consequences”. The decision related to the correct interpretation of Article 13(1) of the Enforcement Directive.

The decision, which related to copyright infringement,  held that compensation for the moral prejudice suffered by a victim of IP infringement could be sought. The decision rested on the conclusion that not only the wording of EU Law should be considered but also its context. Therefore if there is financial damage to IP right holders and there is also moral damage, for example to the reputation of an author, then this should be accounted for as well.

Thanks again to Sue Radcliffe for this one.

Battle of the suitcases.

http://www.theguardian.com/business/2016/mar/09/kiddee-trumps-trunki-in-battle-of-the-suitcases

Magmatic has lost its appeal to the Supreme Court – see link above. This means that design protection has become very narrow indeed. The decision makes it clear that designs do not cover product “innovation” but instead covers the precise representation of the design. Therefore if you have products of a similar design shape but the surface decoration is different there will be no infringement.

This is not a good day for designers but I guess the Courts are looking at the balance of costs and the market in line with TRIPS which balances the rights of rights holders against society as a whole. Basically it is making sure there is enough competition to ensure that prices are not too high. Seems at odds with the whole idea of the IP system but hey hum….

Thanks to Sue Ratcliffe for this one.