Examination of Witnesses (Questions 80-99)
HIS HONOUR
JUDGE FYSH
QC SC, MR IAN
FLETCHER, MR
EDMUND QUILTY
AND MR
ANDREW LAYTON
28 JANUARY 2008
Q80 Chairman: How much does it cost
to run your section in the whole enterprise? They get you for
free, obviously.
His Honour Judge Fysh: Yes, I
do not want to overdo it, but I do do all of this for free. My
deputy—I only have one left now—is a senior silk at
the Patent Bar as is the tradition, or a senior solicitor in a
firm that has done intellectual property work. They charge at
£316 per day but, as his clerk said to me recently, "I
think we may have to have a look at that again".
Q81 Chairman: Do you think it would
be better if the Tribunal was in the Ministry of Justice? What
is your view on that, Judge Fysh?
His Honour Judge Fysh: I am happy
with the UK IPO. Intellectual property is a very specialist part
of the law and as I know from my own court, the Patents County
Court which was set up to cater for litigants in person, they
are absolutely lost in this area of law. I feel very comfortable
going along with the UK IPO rather than the Ministry of Justice
where tribunals range from the Brown Egg Marketing Board to the
one in my own building, the Asylum and Immigration Appeals Tribunal.
Q82 Chairman: So if it is not broken,
do not fix it.
His Honour Judge Fysh: Precisely.
Q83 Mr Boswell: Would you be a little
more comfortable if you could move along a little more quickly.
His Honour Judge Fysh: Yes.
Q84 Chairman: How can we improve
the interaction between the Tribunal and the IPO, do you think?
Is there a way of doing that?
His Honour Judge Fysh: We get
on pretty well I think at the moment. I have gripes and so on
about the staffing and about the furniture; we do not really have
a proper courtroom in my view. I went to Canada—I was sent
there by the UK IPO, by Mr Fletcher' predecessor—to have
a look at what they do. They have a staff of 12 and a proper courtroom.
The Chairman of the Canadian Tribunal, like me, is an IP judge
and he does it part time (he is paid). We get on very well; there
is a symbiosis, we have an understanding.
Q85 Chairman: How about the collecting
societies? Could you incorporate them deeper into the organisation
in any way?
His Honour Judge Fysh: No. I stay
clear of them because I have to adjudicate over them. I am very
friendly with them; I meet them on social occasions; one of them
shook hands here as he went out.
Q86 Mr Boswell: We have not mentioned
the word "fees" this afternoon and as I understand the
recommendation in the report is actually to dispense with them.
If I understand Judge Fysh, he is saying you have to hit out or
get out, there is no point in going half way. If there is a problem
with resourcing, if these are very high end cases with a huge
legal input—up to £12 million you quoted—is it
reasonable to say that the parties should put something towards
this?
His Honour Judge Fysh: I would
think yes, and I would think the fees should be quite hefty but
we would have to look at them carefully because we do not want
to deter people. People who have no resources must obviously not
be kept out of court. By the same token, some fees are a good
idea. I was admitted as an Indian advocate before I became a judge
and the fees there remained absurdly low so the whole system gets
entirely plugged up with frivolous applications. I have not detected
that with the Copyright Tribunal; these are all serious players.
Mr Fletcher: One of the things
that has emerged from the debate which has followed the publication
of last year's review is the question of the kind of secretariat
support for the Tribunal. I am absolutely clear that the amount
of resource that the Intellectual Property Office puts into it
needs to be beefed up. We are looking now to see if we can measure
how much, at what level and so on we need to put in. I want to
be really clear that I share Judge Fysh's view.
Q87 Chairman: How long will it take
to determine all this?
Mr Fletcher: Probably two to three
weeks at least. The work is going on now and that is something
we should do and we are going to do. The case for that is absolutely
clear.
Q88 Mr Cawsey: The ALCS submission
to us spoke about the proliferation of digital technology having
upset the balance between rightsholders and users as opportunities
to obtain creative works for free have increased. What effect
do you see the emergence in growth of digital technology has had
on the balance between the rightsholders and users?
Mr Fletcher: It has put it under
real, real strain. When I look at the ministerial post bag, when
I look at our own rate of enquiries across the entire field of
intellectual property, I think it is 98 per cent plus in the area
of copyright. There is little dispute even among those who are
passionately involved about the patent regime or the trade mark
regime even though both of them are immensely valuable to the
economy; they do not give rise to the kind of conflict that we
often see in the copyright area. The second thing is that it is
an area where, as you rightly say, changes in technology have
actually combined with changes in user behaviour and expectations,
what people think is fair at the kind of level of the teenager
as well as the other end of the scale the entry into the wider
copyright world of some pretty unsavoury characters. There is
very wide spectrum of behaviour and technology providing significant
opportunities for people to develop new ways of behaving or new
ways of making money. I think the fundamental point that I start
from is, as I said before, that intellectual property is an economic
question carried on by legal means. It is clearly the Government's
policy that creators should be appropriately remunerated and the
challenge we face is to ensure that the framework of rules keeps
up to date with that as far as we can. The Government's response
to unlawful activity is as clear as it can be and, turning to
the subject of your inquiry, the means of setting remuneration
within that framework is as up to date as we can get it. I think
that is the wider picture.
Mr Quilty: The Gowers Review which
was referred to earlier on was fairly comprehensive and it made
some recommendations which were designed to address the problems
of the digital age. We have a programme of work there to do in
putting a lot of that stuff in. Obviously that Review and the
implementation of it will not be the end of the story because
we will be hit by new technology and challenges. The problem for
us will be to try and construct a regulatory system which survives
each new technology as it comes up. That might be the thing we
would really need to look at in the future.
Q89 Mr Cawsey: Professor Lessig,
chairman and co-founder of Creative Commons posed the question,
does copyright have limits? Historically copyright was relatively
tightly drawn but in the past quarter century it seems to have
extended exponentially and is set to conquer digital technology.
Is the Government aware that these other views are out there?
Have you actually considered whether the creative industries might
flourish under a less restrictive regime?
Mr Quilty: One answer to that
is actually Gowers itself. In certain areas the recommendations
of Gowers will actually result in a de-restriction of the copyright
regime, particularly if the format shifting exemption is put into
place. It is quite right that there are certain ways in which
the system could be tightened up but there are also ways in which
it can be made more relevant to the age. The main thing is that
we have to keep a balance at the end of it and we have to try
to make sure that where we get to is that the interests of the
users and rightsholders are balanced.
Q90 Mr Cawsey: So you rule nothing
in and nothing out; that is what improves the overall system.
Mr Quilty: Yes.
Mr Fletcher: That has to be the
right answer. Certainly we participate in debates with people
who advocate revolutionary changes as well as evolutionary changes.
The Creative Commons people are a good example of that. We have
to go back to the starting point that we are looking to ensure
that the economic objectives if the IP system are foremost and
that includes, I think, the clear understanding that creators
and rightsholders need an appropriate level of remuneration for
their efforts. Against that broad test there is nothing that ought
to be excluded.
His Honour Judge Fysh: Could I
just draw your attention to the fact that in this field counterfeiting
is on an enormous scale. The people who come to our Tribunal are
the goodies, if I may call them that. We had evidence at the Downloading
hearing that there are now so many sites whereby one can download
all sorts of things but above all recorded music. If we set the
tariffs too high people will just go to the sites where you can
get the latest songs within half an hour of them being published.
Q91 Mr Boswell: I want to come in
on the consultation process following the IPO study. I am sure
it would characteristic of this sort of occasion that the representations
you receive from the interested parties are almost predictable
in advance and you may well know what you are going to have from
them. Have you had much interest—I am not asking for the
details here—from what might be termed persons who may have
an intellectual interest in this area and/or have you got much
access to outside academics and experts in helping to formulate
the policy? I think this has been an interesting exercise for
us because it is something we have not addressed for a long time
and I am glad that we have, and clearly you have, I am not suggesting
you have not. I am interested in how much the debate is a real
one and how much it is a kind of re-run of the parties of the
Tribunal in fact.
Mr Fletcher: One of the things
which has been very apparent over the last year has been that
the Intellectual Property Office and the Government more generally
has not had access to the quality of economic analysis that we
needed. One of the solutions was contained in one of the recommendations
in the Gowers Review which was a recommendation that Government
establish something with the accurate but uninspiring name of
the Strategic Advisory Board for Intellectual Property as an advisory
NDPB and we are in the process of doing that.
Q92 Mr Boswell: Will that have a
strong economic input?
Mr Fletcher: And a £500,000
research budget which is a lot of money in research terms; you
can buy a lot of academic time for that. We provide the secretariat
and the budget but it is to be an independent advisory NDPB. That
will go some way from broadly the middle of this year when I expect
it to get underway to fill that gap. There is an interesting Australian
kind of precedent for that, the Australian Council for Intellectual
Property which has played this role which I actually suspect was
the Gowers model. Secondly, the Intellectual Property Office itself
is in the process of setting up an economics and evaluation unit
to do three things. One is to ensure that the normal services
that we offer are subject to an appropriate level of evaluation
from the point of view of the economic beneficiaries and I think
that is an important piece of our accountability. The second thing
is to ensure that policy development, particularly in areas like
copyright, is appropriately underpinned by economic work to ensure
that we can focus on the changes in the economy or the changes
in economic behaviour that we would like to get. The third reason
is to ensure that we can connect to the rest of the DIUS departmental
agenda appropriately. That is something that is really our top
priority in terms of organisational change exactly so that we
can we can begin to be in the position to have the best possible
economic insight to the development.
Q93 Mr Cawsey: Over the last 20 years
of so the governments of the day's preferred way of pleasing monopolies
has been regulators. Is it the Government's objective that the
Copyright Tribunal should become a regulator for copyright and
for fees?
Mr Fletcher: I know of no suggestion
that it should become a regulator in the sense that you are talking
about. I think the role that the Tribunal plays is narrow but
I do not mean that pejoratively; it is a carefully circumscribed
but important one of adjudicating on licensing arrangements, particularly
collective licensing arrangements. The wider question of how the
creative industries work does not necessarily to my mind give
rise to regulatory questions which are not resolvable through
the normal operation of the competition laws and/or the civil
courts. I am not sure there is the kind of special position you
get in power and gas for example or telecom where you need an
independent regulator.
Q94 Mr Cawsey: Would you have an
ombudsman then?
Mr Fletcher: I think one uses
ombudsmen to deal with issues of unfairness as a kind of backstop,
a kind of catcher of the ball of last resort. Our thinking about
this is that the Tribunal has tackled cases brought to it by applicants
who have been large, well-resourced with big legal guns behind
them. I think there is a question—I think Judge Fysh's comments
this afternoon have alluded to it—about the extent to which
the Tribunal's scope includes ready access for smaller applicants
or people who have a particular interest. I think there is scope
there, but I would not use the word ombudsman but a smaller claims
kind of question.
Q95 Mr Cawsey: Exactly. It has been
put to us that recourse to the Tribunal might be avoided in some
cases if there were somewhere else to go that was more simple
in the first place.
Mr Fletcher: I think there is
a real question there that we need to think through. Some of it
might be through thinking through how we would handle under the
Tribunal kind of ambit smaller claims. The other is the question
that was raised by your previous witnesses about mediation where
my office has mediation services in the patent area particularly
which we are really just experimenting with. We have only had
the first few cases and it is not yet clear how far it goes.
Q96 Mr Boswell: Is there going to
be a Government policy on orphan works or is it just simply going
to wait for Europe?
Mr Quilty: We have to wait for
Europe and we then have to evaluate what they have come up with
in terms of direction and then figure out what it would mean for
us.
Q97 Mr Boswell: Given that you are
an arm of Government this is important and an area where I have
had interests myself in the past. Can we at least be certain that
Government will go to Europe with a fairly clear position as to
what you would like rather than appearing that you were the passive
recipients? I am fairly anxious that we should be seen to be influencing
the debate for good, bearing in mind, as Mr Fletcher has reminded
us quite properly, this is a serious economic interest and not
some kind of antiquarian or lawyers side show.
Mr Quilty: One point is that the
Government is feeding into those European negotiations. Another
thing is that DCMS have the lead role. I think so far as we are
concerned it is in our interests to have a fairly clear idea of
what we want to achieve out of it. If you are involved in European
negotiations you have to be a little bit clever about how you
phrase your suggestions, you do not want to start with a position
that immediately puts you on the sidelines. Yes, we need to know
what we want but we also need to know how we handle it properly.
Mr Fletcher: I guess the real
point that you are driving at is that we are in consultation with
particularly the library sector but also others on the wider question
and as Mr Quilty says our approach is an active one, we are not
sitting back passively waiting expectantly for the answers.
Q98 Chairman: If we looked at the
Copyright Tribunal again in a year what difference would we see
do you think?
His Honour Judge Fysh: You will
see one change which is to do with a sub-judice case. There is
a section called section 128 A and B which is mysterious. It came
as a result of the EU Rental Directive. Section 72 was amended
to bring in what is called excepted sound recordings, in other
words broadcasts performed in commercial premises were formerly
excepted but now they are not. There was consultation about that,
then when the Act was amended we discovered on the amendment that
there was a quite complex series of steps to be taken involving
a reference to the Secretary of State and an extraordinary inquisitorial
role imposed upon the chairman, almost continental style, such
that I was to go around barber shops and shops and garages and
so on and find out what people thought about it.
Q99 Chairman: That is our job.
His Honour Judge Fysh: It sounds
rather fun, in fact I have just done it for the purpose of my
judgment which will not doubt raise howls of irritation. That,
I would hope, will change.
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