Archive | 2013, October | (5) posts

Counterfeit brand products – A harmless tourist attraction?

What a bargain! A Gucci bag for 100 USD! A Burberry scarf for 75! Nike trainers, 25 US Dollar!

What’s the harm? Even if they hold together for just a year, they’re still a bargain. Right? I don’t care if they’re not original. They look alright, and someone made the effort of producing and selling them. Maybe I’m actually doing some good for someone less fortunate?

The excuses I’ve heard are endless. And if I had a dollar for each time I’ve been told not to care, I probably could afford an original Gucci bag. The commerce with counterfeit label products has always bothered me, and since I started working professionally with intellectual property rights, I feel obliged to take a firm stand against all types of counterfeit commerce. But as I learn more about the forces behind it, my stand point is no longer just principle. I have come to understand that there is a far more dark side to it than people in general know, or want to see.  There is a difference between a cheap price and a bargain. And the cheap prices offered by counterfeiters often come at a very high cost to others.

Counterfeit is one of the largest growing industries with a turnover of millions of dollars, and it is growing. As long as consumers buy counterfeit products there is no incentive to stop counterfeiting. But are consumers aware of what they are actually buying?

The working conditions in the factories are often horrific, and there is no such thing as work environment control or regulated working. The workers, often very poor, young people, even children, are subjected to toxic chemicals without any kind of protection. Shady criminal organisations are making lots of money on people’s will to buy cheap fake merchandise. If you are concerned that your local fashion store buys clothes from manufactuers using child labor, or manufacturers not taking responsibility for the colour dye used in the process of making your red top not being lethal, I suggest you think twice before even considering bying a counterfeit brand product. In most cases you can rest assured that they are manufactured under conditions that you would never accept from a cheaper brand. So why is it okay when the brand label says high end but the price tag says high street?

The International Anti Counterfeiting Coalition (IACC) list six reasons why you should never buy fake:

  • Counterfeiting is illegal and purchasing counterfeit products supports illegal activity.
  • Counterfeiters do not pay taxes meaning less money for your city’s schools, hospitals, parks and other social programs.
  • Counterfeiters do not pay their employees fair wages or benefits, have poor working conditions, and often use forced child labor.
  • Counterfeit goods are often made using cheap, substandard, and dangerous components that put the health and safety of consumers at risk.
  • The profits from counterfeiting have been linked to funding organized crime, drug trafficking and terrorist activity.
  • When you purchase a fake, you become part of the cycle of counterfeiting and your money directly support these things you would never want to support.

This is not a harmless tourist attraction. Depending upon the nature of the product being counterfeited, there can be serious health and safety concerns for consumers, such as in the examples of counterfeit baby formula, toys for children, medications, car parts, batteries, alcohol (containing methanol), or electronic goods. In nearly every instance, counterfeited goods are not made with the same quality materials or to the same high standards as the original.

Even when there’s no danger for the consumer, you should still consider the time, money and effort spent by companies to come up with, market and protect their brand. Years of hard work is put in by product developers, marketers, attorneys, sales managers etc. to put their product on the market. Authorized resellers cannot compete with the growing illegal market.

Furthermore, you should be aware that in some countries you can be prosecuted for buying counterfeit goods, and you do not want to get caught in customs in, for instance, Italy or France carrying a fake bag. Tourists have been fined up to 10,000 Euro by Italian police for buying a fake handbag.

I could go on and on about this topic, but if no other argument bite, counterfeit is theft. Plain and simple. Would you ever promote theft in any other area?

Elisabeth Åhrberg, LL.M. at Awapatent

© Comité Colbert. Poster from a French anti-counterfeit campaign, launched by luxury group Comité Colbert, French Customs and the French National Anti-Counterfeiting Committee, collaborating with some of the major French luxury brands.

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The on-sale bar under the AIA

Do non-public sales in Europe destroy novelty in the U.S.?

Among the many news that applicants have had to digest in the America Invents Act, the revised on-sale bar may be one of the more intriguing. Before the law reform, grant of a patent was excluded whenever

the invention was … in public use or on sale in this country, more than one year prior to the date of the application for patent in the United States.
(35 U.S.C. section 102(b); emphasis added)

I was then able to reassure my local clients that they could sell products or prototypes embodying a yet unpatented invention as long as the sales were secret and did not involve a U.S. buyer. Indeed the courts had clarified pre-AIA that also private sales, even offers to manufacture a new product, could destroy novelty and invalidate a granted patent.

Under the AIA, the same section reads:

A person shall be entitled to a patent unless (1) the claimed invention was … in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention.
(35 U.S.C. section 102; emphasis added)

Section 103, concerning obviousness, has been amended similarly.

The geographic limitation “in this country” has been deleted. Clearly my clients’ activities within U.S. territory will count the same as outside.

So what about secrecy? An American friend – he’s actually a patent attorney friend – tells me that it’s quite unlikely that non-public sales will qualify. The language “on sale, or otherwise available to the public” is rather clear, suggesting that sales activities are relevant only to the extent they are public. This conclusion was not contradicted by any political statements during the legislation process, and the USPTO appears to embrace it.

However, the legislator deleted “in this country” but did not care to insert, say, “[on] public [sale]”. My friend tells me this fact could support an argument that the legislator did not intend to distinguish secret sales from non-secret sales.

It may take years before an influential U.S. court speaks on this matter. Till that time, we know that it is fairly safe to sell unpatented products under NDA. If you feel your inventions deserve better, remember to file before you sell – at least a simple first version.

Anders Hansson, European Patent Attorney

An End to Faking It

Contrary to what many think, IP-law is not subject to an EU-wide harmonisation. This is probably due to the existence of the Community Trademark but bear in mind that all the national systems are still well and alive and existing alongside the EU-trademark.

Recently, the UK Copyright legislation has been amended. Very frustrating for rights’ owners, UK Copyright expired 25 years after the creator’s death. Most other countries have 70 years.

This meant that especially objects of industrial design and designer furniture were reproduced quite legally in Britain. Mies van der Rohe’s Barcelona chair, Arne Jacobsen’s Egg chair and similar classics were among the popular items. The big frustration for rights’ owners was that these products were widely exported across the EU borders.

Some British knock-off manufacturers even had web pages targeting, say, German, Italian or Danish costumers. Some manufacturers even had concrete and public plans of setting up showrooms where consumers from countries with higher copyright protection could see the products and order them.

This was all legal under UK law – but not legal in the rest of the EU member states.

A common misconception by many consumers in the EU is that goods purchased in one member state in general may circulate freely. This is not the case when the goods are illegal in the member state whereto they are ordered. The Internal Market of the EU will always yield to IP-rights. Offering goods for sale indirectly through show rooms does not change this. However, for the rights’ holders enforcement may be extremely costly and cumbersome as each infringement had to be countered nationally.

All this is now well in the past. A recent amendment to the UK Copyrights, Designs and Patents Act 1988 has brought the protection of copyrighted materials in the UK in line with the continental European countries, i.e. 70 years after the creator’s death.

Surely a good thing in the name of harmonisation of legislation, the protection of rights and an incentive to invest long term and create jobs in the creative business sector in the UK?

So is everybody now happy? No. The makers of these classic furniture knock-offs have complained that their business and the jobs will be heavily affected. Lamentable, but hardly a valid argument for sustaining a business that exists mainly with the focus of selling copies to countries where protection is high. And at the end of the day we are still talking about (now) illegal counterfeits.

Others that may be unhappy could be companies such as McDonalds. In Europe McDonalds famously rebranded their restaurants with designer furniture. Then quickly after the stock of same furniture was discovered to be heavily supplemented with designer knock-offs. Although this furniture to some extent – at least in the UK – may have been legal, McDonalds were publicly lambasted by Danish furniture company Fritz Hansen. The company suspended all supplies to McDonalds and accused McDonalds for endorsing piracy and setting intellectual property rights aside. I am sure that many will agree that this was not PR which McDonalds was happy with.

For lovers of copy furniture all is not lost. The works of Arne Jacobsen will exit copyright in 2041 and Mies van der Rohe in 2039…

Thorbjørn Swanstrøm, Trademark and Design Attorney, Attorney at Law, Partner

The pride and joy of working as a Patent Attorney

What was your dream job as a child? My best guess would be astronaut, musician, actor, fireman, veterinarian or soccer player. But what about Patent Attorney? Not on your list?

Definitely, the dream job changes if you ask a child compared to a university student or a newly-graduated student. Lists are regularly published regarding the most popular professions and employers for this group, which is not surprising – the information about the favourite professions is used by politicians, universities, etc., to monitor the educational trends, and companies are more than keen to see how popular they are as an employer.

If you study a recent list of the most popular professions in Sweden, you will find engineer, economist and teacher at the top positions. Furthermore, for engineers, traditional and relatively large Swedish companies constitute the major part of the list of the most popular employers, although foreign companies like Google, Microsoft and McKinsey also do well.

Looking from my own perspective, the profession as a Patent Attorney is hard to come across in surveys of this kind. Even though the mentioned list of the most popular employers does not reveal what kind of profession these companies are looking for, my guess is that an employment as a Patent Attorney at the company is not what comes up first in mind for a student. Furthermore, one could note that no patent agency is to be found in the Swedish top 50 list.

My explanation for this is that the profession – for many people – is rather anonymous. When asked my profession at meetings, parties, etc., I actually get the feeling that my answer puzzles my interlocutor. However, when I continue to describe the details in what I do, i.e. having meetings with companies, universities and inventors regarding their technical development and inventions, drafting patent applications and constructing patent strategies, debating with patent offices and having world-wide contacts with fellow patent agencies, the facial expression of the person in front of me often changes as if he or she was thinking “hey, that sounds interesting!”

So, looking for a career where you can combine a technical knowledge with a linguistic aptitude, see the leading edge of technology, get international contacts, develop your legal knowledge and defend the rights of your company/client? Look no further. The job as a Patent Attorney is interesting, dynamic, challenging, fun and rewarding, and should most definitely qualify amongst the most popular professions around.       

Love  Koci, Patent attorney

Russian documents unveiled

Russian is the 22nd available language in Patent Translate, a machine translation tool specially tuned – by Google and the EPO – to patent documents and patent lingo. In the particular case of Russian, I expect Patent Translate will be saying “claims” rather than “invention’s formula” and similar nonsense. The public can use Patent Translate to translate any patent document on Espacenet.

In a recent press release, the EPO says the new technology will have an impact also on the searches its examiners perform. Certainly, all important patent literature in Russian (1.5 million documents) was already searchable and indexed, often with English abstracts too, but the Office believes that access to full-text translations will increase the chances that relevant prior art is discovered and considered during examination. On top of this, the Russian Patent Office will be adopting the CPC classification system shortly (commented here).

At least in theory, patentees should feel less worried about Russian “submarines” that their competitors might fish up after grant.

What technical fields will benefit the most? As a first guess, I’ve compared the top ten IPC classes in the 5,000 most recent EP, RU and Soviet publications.

  European Patent Office (EP) Russian Federation (RU) Soviet Union (SU)
1 A61 Medical devices; hygiene A61 Medical devices; hygiene C07 Organic chemistry
2 H04 Electric communication C07 Organic chemistry A61 Medical devices; hygiene
3 G06 Computing G01 Measuring; testing B01 Phys./chem. apparatus
4 G01 Measuring; testing H04 Electric communication H01 Basic electric elements
5 C07 Organic chemistry G06 Computing A01 Agriculture; forestry
6 H01 Basic electric elements C12 Biochemistry; beer; wine G01 Measuring; testing
7 C12 Biochemistry; beer; wine A01 Agriculture; forestry C08 Polymers
8 B01 Phys./chem. apparatus B01 Phys./chem. apparatus B29 Working of plastics
9 C08 Polymers H01 Basic electric elements F16 Engineering elements
10 A01 Agriculture; forestry C08 Polymers C12 Biochemistry; beer; wine

Based on this rather unsophisticated analysis, there are just moderate differences between SU and EP patenting. Contemporary EP and RU documents are distributed in a very similar way in terms of IPC classes, meaning that the Russian material is likely to be relevant for a large percentage of the European patent applications. I’m curious to see if the EPO examiners will actually cite more Russian language documents in the next years.

Anders Hansson, European Patent Attorney