Select Committee on Trade and Industry Minutes of Evidence


Examination of witnesses (Questions 414 - 419)

TUESDAY 11 MAY 1999

MR R WESTON and MR A SERJEANT

Chairman

  414. Good morning, may I welcome you here. You represent patent agents. Perhaps we could start with the Silhouette case which has become something either of a cause celebre or a benchmark; I am not quite sure which is the appropriate metaphor to apply. Do you think it is feasible to discuss exhaustion of trademarks separately from discussing exhaustion of other rights—patent, copyright, design, etcetera? If international exhaustion is to apply, should it not apply to all forms of intellectual property rights?
  (Mr Weston) In principle, yes. It is just that items of trademarks, copyrights or designs are much easier to recognise as being counterfeit, copy or parallel import, whereas patents tend to be, as in our written evidence, usually how things work, how things operate or are formulated or constituted. It is more difficult to detect and establish that there is copying taking place or generally to monitor the information. In principle, yes, all items of IP are effective. In this country on counterfeit goods, trademarks and copyright and design rights are enforced because they are items of IP which are more readily applied by the courts, but I understand for example in Germany patent infringement is the preferred course of action because that is the better way to get enforcement in those courts. Even within the European Union, the varying national jurisdictions which are still established choose as to which is the most appropriate form of intellectual property the owner would wish to use to enforce or control what is being marketed in their country.

Mr Laxton

  415. Looking through the evidence you provided to us, you have not come out with an opinion on whether parallel importing from outside the EEA should be allowed. You might perhaps want to stand back a little from being specific on it but can you give the Committee some indication of the problems your members would face if the current regime were to be changed and parallel importing from outside the EEA were permitted?
  (Mr Weston) The classic answer to that is: on which side of the fence am I sitting today? We have the whole gamut of clientele we have to represent. It goes from the multinational branded force at one end to the parallel importer the other side. We have to make certain that we deal with the law either as it stands or as it will be changed, to make certain that our clients are represented and their interests are covered as well as possible. It has to be remembered that in the current regime we are talking about importation control, it is restricted to intellectual property. Intellectual property is there, is a right, but there are two sides to the question: whether that intellectual property item has been infringed or not; second, whether it is a valid item of intellectual property in the first place. You talked about items such as Silhouette, Colgate, Shield, where there are unquestionably trademark rights or get-up rights because these are the very clear items. In other areas first of all you have to establish whether there is enforceable intellectual property relative to this item. That being so you then have to determine whether or not that right has been infringed. It gets more complex, especially with regard to patents, than perhaps with regard to trademarks and copyright. For example, in the recent EC directive on free zoning, the way they have treated trademarks there is that they have said that in this area if a mark is identical to the alleged infringement you can go in because this is a question of copying, whereas for patents they just say if there is an infringement. Determining infringement of a patent is a far more diffuse, grey area than some items of trademark infringement. There are other items of trademark infringement which are equally difficult to determine but these have been taken out of this particular bit of EC regulation. Yes, I am a fence-sitter, but I have to represent my client whichever way it is. Although we will go individually, we have personal views.

  416. Fine. You have reinforced the fact that you did not come out in the first instance with a clear opinion and I understand the position you are in. What would your view be on the suggestion that there should be global exhaustion of rights with certain sectors exempted, for example pharmaceuticals? What problems would arise for your members if this did occur?
  (Mr Weston) No more or less than the problems we have at the moment. It would just be a different law coming into force which has to be dealt with in a different way. We live in a milieu of constantly changing IP laws anyway in this country, within the European Union, worldwide. It is something else where we would have to develop our expertise, the jurisprudence and take on board. I would like to add, dealing with regional exhaustion of rights and worldwide, that this country has signed up to TRIPs and the Uruguay round of TRIPs and the view has been put within the committee I represent of the Chartered Institute that yes, we should proceed with that and TRIPs does not prohibit worldwide exhaustion of rights. If that is the way it is, that is what we do with it. The current situation with Silhouette and the enforcement of the laws there which is going on now has regional exhaustion. Certain members of my Institute are advising the importers and other ones are involved in the cases against them. We are trained and we have to look at both sides of the question.

  417. What are the main problems which your members face under the current regime?
  (Mr Serjeant) As members we do not face any problems. It is our job to adapt to the circumstances, to adapt to the law and to the facts. We are no different from any other member of the public in that respect.

Chairman

  418. Is the law clear? Do the people whom you represent know where they stand even when they get the advice from you?
  (Mr Weston) The answer to that is no.

  419. So the law is not clear then.
  (Mr Weston) The law is never clear. Clients want certainty, commercial certainty. Can I sell this, can I not sell this? They quite rightly wish for certainty and we have to give a classic lawyer's answer of ifs, buts and maybes and come down to conclusion one way or another on the fact of that particular case on the information in front of us. We are a form of lawyer, so we have to balance questions. There are areas where commercial certainty could be improved to the benefit of our profession and to the benefit of all the clients we advise, for example, in trying to get a pan-European or pan-European Union enforceability of IP rights. We have the Community trademark in force, we have the Community patent being proposed and it would be very nice if we could have a single court of first instance to try for infringement rights as well as for validity. There is the famous EpiLady case. You may remember the EpiLady which was a torturous instrument which was supposed to pluck out hairs from your legs and other parts of the body. It was basically an Israeli invention for which there was a European patent. The European patent was that the EpiLady device itself had a spring with a loop in it which was twisted round at high speed so the coils of the spring opened and closed and had a tweezer action. So it was like not one tweezer but a multitude of tweezers ripping hairs out of your legs. I remember I bought it for my wife and she had one go at it and she thought I was trying to get instant divorce proceedings. A European patent was granted for this and the European patent means it is the identical patent with the identical claims, granted and then burgeons out into a series of national rights. Remington thought it was a good idea and that they would do a complementary device, not an identical copy. They looked at it and instead of having a spring, they had a rod with a whole series of little disks in them. When the rod was bent the disks would come together, come apart and have the same tweezer action. The claim recited a spring. Infringement proceedings were brought by EpiLady against Remington in the United Kingdom and in Germany. On the identically worded claim no infringement was found in the United Kingdom because the claim said a spring and the alleged infringement had a disk with rods on. An infringement was found in the German courts because they said the action was the same, the underlying thought or invention behind the claim was the same. This is because over the years German practice with regard to claims and continental practice with regard to claims is different from the common law countries. However, in the IP area we are being forced to harmonise more and more and initially the harmonisation has been in the area of obtaining the right and assessing the validity of the right but the actual enforcement of the right, infringement of the right, has been left to national interpretation and national jurisdictions.


 
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