The company uses the phrase "should've gone to Specsavers" in its adverts.

The trademark application means that other companies will not be able to use that form of words in their marketing.

Sally Britton, intellectual property lawyer at Mishcon de Reya, said it was not surprising that Specsavers had moved to trademark the word.

The term "should've" will clearly work well from a domain name and social media perspective and therefore why would they not seek to protect it to make it easier to deal with infringements?

Click here to read the full article.

Related news articles in Express, GQ and The London Economic.  

In a pilot project by the City of London police, the lead force on fraud in England and Wales, officers will pass details of suspects and cases to law firms, which will use civil courts to seize the money.

The force says the scheme is a way of more effectively tackling fraud – which is now the biggest type of crime, estimated to cost £193bn a year. It is overwhelming police and the criminal justice system.

The experiment, which is backed by the government and being closely watched by other law enforcement agencies, is expected to lead to cases reaching civil courts this year or early next year.

Officers will use the private law firms to attempt to seize suspects’ assets. If unsuccessful, police could decide to leave it at that or pursue the case themselves through the criminal courts.

Commander Chris Greany, head of economic crime at City of London police, said: “It is a huge shift … Civil recovery allows us to get hold of a criminal’s money sooner, and repay back victims sooner.”

The lead law firm taking part in the pilot is Mischon de Reya, best known for representing Princess Diana in her divorce from Prince Charles.

Greany said: “Who benefits from this? The victim will benefit, because they will get their money back. We’ll benefit because the criminal will be skint and they will be brought back down to having nothing again, and have to get about their normal lives, and they won’t have status in the community.”

Robert Wynn Jones, a specialist in fraud at Mishcon de Reya, said the “novel and pragmatic” scheme would boost the deterrent to criminals. Wynn Jones said victims might be asked to pay legal costs, or specialist insurers could fund the fees in return for a 20-30% share of the money taken off criminals.

He said it would have to be financially worthwhile, meaning the scheme would only work for cases where losses ran into the hundreds of thousands. The use of private investigators would push up the cost.

“There is no way the police can investigate and pursue this level of fraud – they don’t have the resources.”

Click here to read the full article.

Related news articles in Legal Week, Computer Business Review and Police Professional.

Background

Mr Hayward suffered an injury at work and brought a claim for negligence against his employer. Both the employer and its insurer, Zurich, suspected that Mr Hayward's claim had been exaggerated, but they had no proof. They therefore agreed to settle the claim, and this was funded by the insurer.

It later became clear, through evidence provided by Mr Hayward's neighbours, that his injuries had been exaggerated. The insurers therefore sought to have the Settlement Agreement set aside using the tort of deceit. This is an unusual feature of the claim, in that the insurers were not a party to the original Settlement Agreement.

The claim raised the question of whether a settlement agreement could be set aside when one of the parties to the agreement had thought that the claim could be fraudulent at the time of settling.
Mr Hayward appealed the initial decision, and the Court of Appeal held that the settlement agreement could not be set aside, because the employers and insurers had suspicions of Mr Hayward's exaggerations at the time of settlement, so had not relied upon Mr Hayward's misstatements when they entered the Agreement.

However, this decision was then overturned by the Supreme Court.

Supreme Court Judgment

The Court found unanimously in favour of Zurich. Lord Clarke held that "it is not necessary, as a matter of law, to prove that the representee believed that the representation was true". It therefore did not matter whether Zurich or the employer believed the misstatements or not. All that was important was whether the misstatements were in some way material to them entering into the settlement.

The court found in favour of Zurich's argument that whilst they had suspicions about the injuries, they also had a genuine concern that a court may believe Mr Hayward's claims if the matter had proceeded to trial. This had therefore led them to enter into the Settlement Agreement. Lord Clarke agreed with the first instance judge, HHJ Moloney QC, when he said that "at the very least, statements made in the course of litigation will be viewed with healthy scepticism and weighed against the other material available. Often the other party will not be sure, even then, whether the statement is in fact true and will mainly concern himself with how likely it is to be accepted by the court". Lord Clarke also held that there is no duty upon a defrauded representee to exercise due diligence to determine whether there are reasonable grounds to believe the representations made.

Whilst the court did not go so far as to say that this was a universal rule, they acknowledged that there may be circumstances were misstatements that were not believed to be true, could still cause a party to enter into a settlement agreement.

Lord Clarke further stated that "it is difficult to envisage any circumstances in which mere suspicion that a claim was fraudulent would preclude unravelling a settlement when fraud is subsequently established".

Lord Toulson, who was also sitting for the recent Supreme Court decision, Versloot Dredging v HDI Gerling Industrie Versicherung AG [2016] UKSC 45, agreed with Lord Clarke, but felt it necessary to emphasise that inducement was a question of fact. Accordingly, it is necessary to establish causation in all cases, but causation can be established in different ways. Lord Toulson noted the difficulties that insurers face when they suspect a claim to be fraudulent, but have no means to prove that it is false.

Analysis and Impact

This decision therefore shows that it is possible to set aside a settlement agreement for deceit, even if there were suspicions of fraud when the agreement was entered into. The case also shows the importance of always ensuring that you have insurer consent before entering into a settlement agreement, particularly in the event of suspicions of fraud. This is because you will need to work with the insurer to set aside the agreement.

It is interesting to note that this decision comes a few weeks after another Supreme Court decision also concerning fraudulent insurance claims. That decision, Versloot Dredging v HDI Gerling Industrie Versicherung AG, re-defined what constitutes a fraudulent claim. For further information on this case, please see our article.

For more information please contact a member of the Mishcon Insurance Team.

The Leap 100 2016 is a list of the most exciting, fast-growth companies in the UK, compiled by Mishcon de Reya and City A.M., with experts from The Supper Club, Seven Hills and The Entrepreneurs Network.

The results of the poll, plus an article featuring Fever Tree's co-founder Tim Warrillow on how he's shaking up the premium drinks industry, and a column by Mishcon de Reya IP Partner Sally Britton on why an Intellectual property strategy should be at the heart of every startup’s plans right from the start.

Click here to view a PDF of the two page feature in today's paper.

Stay up to date with the latest The Leap 100 news on Twitter @TheLeap100, #TheLeap100

James unpicks how this mistake may have occurred, and offers Chris some advice on what he can do to resolve it.

Click here to listen to the full interview (item starts at 1: 09: 44)

Breaking Barriers offers a holistic service designed to ensure that refugees can find meaningful employment that is commensurate with their skills, experience and qualifications. In doing so, the charity helps them to successfully settle in the country and to integrate with local communities.

Click here to view some of the portraits from the exhibition.

Click here to find out more about Breaking Barriers.

ALC is a specialised accountant-operated outsourcing service provider to the central and local government agencies of the UK.

Nick Davis said about the deal: "We were thrilled to work on this sale for one of our established clients, which demonstrates again our strength in the recruitment services sector"

Ben Lane, Co- Founder of Allen Lane Limited, commented: "The team at Mishcon de Reya were absolutely excellent and have a deep understanding of the recruitment sector. It was a pleasure to work with them."

The individual is alleged to have a network of 40 individuals behind global scams worth in excess of $60m. His operations centred around payment diversion fraud.

In his interviews, Gary said he was impressed that the Nigerian and Interpol authorities had managed to catch the perpetrator, stressing that in these kind of scams it's almost impossible to find out where the fraudsters are based. He felt that the knowledge that had led to this arrest in Nigeria is useful and should be shared with other police forces around the world.

Explained the way payment diversion fraud works, Gary said:

"Phishing or pharming are words that are used to describe quite simple confidence tricks.

"Phishing works by tricking an individual into giving away personal data over email, and sometimes giving money away in response to the email. Pharming is slightly more sophisticated. This technique involves somebody setting up a fake website which people go onto without knowing they are dealing with a bogus company. The email, however, is the fundamental tool."

"In businesses, account takeover is common. A piece of malware can be sent from anywhere in the world that, when clicked on, manages to get inside a computer system and pass over information about email accounts, allowing them to be monitored. The fraudsters then strike when an order is being placed and money needs to be sent. They impersonate the person in the company and direct money to be sent to the fraudster instead of to the company to which they are due."

Elaborating on what companies can do to protect themselves, Gary added:

"There's a myth that only the larger, multinational companies are victims of cyber fraud. That's not true at all. SMEs are more vulnerable – a scam like this could put them out of business so they really need to take their email communication and protection very seriously. The first step is to protect passwords, and then make sure you have the appropriate security. Make sure that nobody in your company is sending out passwords, or doing anything in response to an unsolicited email without some double checks in place first."

Days in the British Library researching quinine sources from as far back as 1620, trips to find the purest strains of this key ingredient and 5 iterations of the recipe were tasted before the founders were happy with the result and the first bottle of Fever-Tree Indian Tonic Water was produced in 2005. This event will consider how entrepreneurs can shake things up and breathe new life into a stagnant industry.

The informal breakfast will begin with a ten minute introduction from our principal guest, followed by an ideas exchange and networking.

To register your interest, please contact Lauren Hoffman.

Despite not coming into force until 12 August 2016, we already have the first case on the substantive interpretation of the provisions of the new Insurance Act 2015. Lord Sumption has claimed the honour with his leading Supreme Court judgement in Versloot Dredging v HDI Gerling Industrie Versicherung AG [2016] UKSC 45. The judgement redefines and reverses significant aspects of the law concerning fraudulent insurance claims. Specifically, it reverses the position that embellished insurance claims, supported by fraudulent devices or collateral lies, are treated as fraudulent.

The decision impacts not just the common law but also the Marine Insurance Act 1906 and the Insurance Act 2015. This article provides an overview of the law on fraudulent claims and the changes to the law in that regard following Versloot.

Background

In the event of a fraudulent claim being presented, insurers have a choice of potential remedies open to them. For policies that incepted prior to 12 August 2016 the Marine Insurance Act 1906 (s17) allows for avoidance of the policy in its entirety. For policies which incept on or after 12 August 2016, the Insurance Act 2015 (Part 4) will allow insurers to terminate the policy from that point forward and to avoid liability only for the fraudulent claim itself (unless the parties have contracted out of this provision).

What is less talked about, although more often applied in court, is the common law remedy for fraudulent claims: known as the 'fraudulent claim' rule. The rule simply allows the insurer to avoid liability for the fraudulent claim. It does not in itself lead to termination of the policy, or allow for avoidance.

So how do the statutory and common law remedies work together in practice? The fraudulent claim rule exists independently of the provisions of the Marine Insurance Act 1906, and will continue to persist once the Insurance Act 2015 comes into effect. The common law rule is however relevant to the interpretation of both. It has developed through a long series of cases, starting in 1927 and culminating with the recent Supreme Court decision in Versloot. The significance of the common law rule is that beyond providing insurers with a remedy, it also determines what constitutes a fraudulent claim and hence, where the statutory remedies can and cannot be invoked.

What is and is not a 'Fraudulent Claim'?

As well as representing a U-turn in at least one significant respect, Versloot also provides a comprehensive review of the law in this area. The leading judgement by Lord Sumption (approved by Lords Clarke, Hughes and Toulson, with Lord Mance dissenting) specifically provides that the rules set out in Versloot will also apply to determining when the statutory remedies afforded by the Insurance Act 2015 will apply.

Lord Sumption identifies three types of potentially fraudulent claims which have emerged through case law:

1. Fabricated claims
2. Exaggerated claims, and
3. Wholly valid claims which have been dishonestly embellished

Fabricated and exaggerated claims are both within the definition of fraudulent claims, and this remains the position. As such they are subject both to the fraudulent claim rule and to the relevant statutory remedies.

Unlike fabricated claims, exaggerated claims (the classic example being inflated quantum) have a good claim at their core. They still however fall squarely within the definition of a fraudulent claim because the "good" part of the claim is deemed inseparable from the fraudulent exaggerated part of the claim.

As a deterrent to bringing fraudulent claims, once it is established that an insured has dishonestly tried to claim for more than he is legally entitled, the insurer is released from liability for the claim as a whole, no matter how minor the exaggeration in relation to the overall claim.

Embellished claims are different again from fabricated and exaggerated claims; they have been subject to inconsistent treatment over a number of years. They are distinct from fabricated and exaggerated claims on the basis that an embellished claim is in fact valid in its entirety. The embellishment comes from what has been traditionally termed as a 'fraudulent device' (referred to by Lord Sumption in Versloot as a collateral lie).

A collateral lie is one which is told with the aim of ameliorating the position of the insured when presenting a claim, notwithstanding that once the full facts have been established it can be seen that the insurer would have been obliged to pay the claim regardless of the lie. As Lords Sumption and Toulson put it, unlike an exaggerated claim, in the case of a claim embellished by a collateral lie "the lie is dishonest but the claim is not".

In Versloot the lie was told in the hope that it would prevent the insurer from investigating potential grounds on which the insured believed the insurer might legitimately have been able to deny the claim/avoid liability. The lie was told in the hope of securing and expediting payment of what the insured believed at the time to be a dubious and potentially invalid claim. It transpired that the insured's belief that the insurer might have been able to avoid liability was in fact misplaced. It was established that the insurer would have been liable on the true facts, irrespective of whether the lie told to them had been true. The question was whether the fact that the insurer had been told a collateral lie by the insured meant that the otherwise valid claim should be treated as fraudulent, allowing the insurer to avoid liability by treating the claim in the same way as an exaggerated claim.

The Supreme Court's answer to this, reversing the earlier Court of Appeal decision and previously established law, was that unlike exaggerated claims, embellished claims are not fraudulent.  Insurers cannot avoid liability for valid claims simply on the basis that an insured has told them a collateral lie (notwithstanding that the statement is dishonest and intended to deceive). Where the actual claim presented is one for which insurers are legally liable - the fact that the insured has lied to try to ensure the claim is paid more quickly, or to attempt to deceive the insurer because the insured wrongly believes that the claim may not be properly payable - does not allow the insurer to avoid liability.

Conclusion

Embellished claims (valid claims supported by collateral lies) are not fraudulent. They do not give insurers a right to avoid liability at common law, under the Marine Insurance Act 1906, or under the Insurance act 2015.

Analysis and Impact

Insurers will no doubt regard the decision as unfair; insurance after all is based on the principle of good faith. Lord Mance considers in his dissenting judgement that the decision means "claimants pursuing a bad, exaggerated or questionable claim can tell lies with virtual impunity". It is however not without risk for insureds to lie when presenting claims under their policies. Even where lies are purely collateral, there are still indirect consequences which may follow by way of potential cost penalties in court, damage to the insured's reputation and its ability to obtain future insurance cover.

Lord Mance, in his dissenting view, has encouraged insurers to consider introducing specific clauses into their policies to allow them to avoid claims associated with collateral lies. No doubt many insurers will seek to amend their wordings accordingly. Insureds, and the brokers advising them, should remain vigilant as to whether such specific clauses have been introduced at placement and renewal to be certain the insureds understand fully their obligations, and effects on non-compliance.

It will be interesting to see whether the decision impacts upon the length of time taken by insurers to investigate claims and whether that in turn has a knock-on effect on the entitlement of insureds to seek damages for late payment of claims by insurers under the Enterprise Act 2016, when it comes into effect next year in May 2017. What will constitute late payment remains unclear - but any reason which might make it reasonable for insurers to extend their investigation of claims could conceivably delay the point from which damages will apply.

The firm has 90 partners, 35 of which are full equity.

The jump in PEP from £975,000 the last two financial years follows a growth in net profit of around 8 per cent to £35m.

London total revenue is also up to £127.9m, an increase of 16 per cent on the previous year when the firm turned over £110m.

The figures continue a run of strong growth at Mishcon. Revenue increased 12.5 per cent in 2014/15 to break the £100m mark for the first time. The results also mean Mishcon has increased turnover by more than 170 per cent since 2009, when revenue stood at £47.3m.

In London the core litigation team continued to be Mishcon’s most substantial practice, bringing in £43.5m last year, or 34 per cent of revenue, although disputes also underpins all of Mishcon’s other groups. The firm’s private client practice generated £18.5m in fees, while real estate brought in £30.9m and corporate £19.5m.

Meanwhile, Mishcon’s New York office turned over £4.8m in 2015/16.

This year saw Mishcon complete a year-long “deep consultation” with all partners, lawyers and business services staff and launch a “10-year vision”.

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The acquisition – which forms part of BE’s five year growth programme - consolidates its presence in the London market and broadens its central London coverage away from its traditional City base and into the West End and Docklands for the first time.

The transaction was structured by way of two share sales and two business sales. It has increased the total number of BE centres to 17; its portfolio increases by 111,000 sq ft to 857,000 sq ft; and total workstations grow to almost 14,000.

Nick Davis, Head of the Corporate department at Mishcon de Reya, led the team, which also consisted of lawyers from the firm's tax and employment practices.

Each year the students are invited to prepare a briefing on a legal issue in sport. The 2015/16 cohort submitted articles on a wide range of topics. To recognise their efforts we have pulled together a selection of the best briefings which we hope will be of interest to you.

The case centred on an abuse of HPE's partner programmes and discounts, with the defendants fraudulently obtaining over £1.5m in discounts on HPE products.

Jeremy Hertzog, Head of Mishcon de Reya's Intellectual Property Department, represented HPE. Commenting on the decision, he said: "This judgment demonstrates that companies such as HPE will be backed up by the Court when they take action to prevent grey marketing and other channel abuse. Our clients rightly felt that they had been wronged and to have achieved the full damages claimed truly vindicates their position."

Mishcon de Reya Sports Lawyer, Kendrah Potts, who was also legal counsel to the commission set up by the UCI to investigate doping in cycling and allegations of mismanagement or corruption by the UCI, featured on the BBC's Today Programme commenting on this story.

Kendrah commented that whistleblowers have the potential to be instrumental in rooting out wider doping issues in sport, and that the IOC's approach does not encourage other whistleblowers to come forward. She stressed that athletes will only volunteer information if they have confidence in their governing body or other authorities. The allegations of cover ups within the IAAF have undermined that trust and the IAAF will have to work to rebuild it. Interestingly, the IAAF eligibility rules were amended in June and created a specific exception to allow athletes providing an "exceptional contribution to the protection of clean athletes" to compete as neutral athletes where their national federation was suspended.

Kendrah also talked about the legal difficulties surrounding the IOC's decision to prohibit Russian athletes who have previously served a ban for a doping offence from competing in Rio. She commented that based on previous Court of Arbitration for Sport decisions, including a previous decision that found the IOC's "Osaka" rule (which prohibited athletes banned for longer than six months for a doping offence from participating in the next Olympics) to be unenforceable on the basis that it imposed an additional sanction in contravention of the WADA Code, it was difficult to see how, legally, the IOC's position could be justified. Even if the reports of state-sponsored doping in Russia justify additional criteria for Russian athletes, this does not justify treating Russian athletes who have served a suspension differently.

To listen to the interview please click here (this story features 1.27 minutes into the recording).

The rumour mill keeps spinning

Rumours abound but it seems nobody knows. Some people argue that the Government and Civil Service are so busy dealing with Brexit that they simply no longer have the resources to deal with the proposed tax changes, and that a delay is inevitable. This belies the fact that much of the hard work was already done by HMRC and the Treasury before the Referendum. It seems unlikely that a shortage of resources alone would be a reason for delay.

Might the Referendum result lead to a change in thinking? With the anticipated economic slowdown, will the Government now reconsider its decision to create a less generous tax regime for long term UK resident non-doms? Many of those who will be affected are big investors and big spenders in the UK. Whilst it's never been easy to measure their positive economic impact, by most accounts it's significant. It's been argued that this is exactly the wrong time to bring in a new tax regime that risks driving them away. At the very least, it's argued that the tax changes should be postponed, or even abandoned altogether, until we know the full economic effects of Brexit. Whether the Government is swayed by those arguments is another thing.

So if a postponement or abandonment of the new regime seems unlikely, whether on political or economic grounds, and we still have no further details of the changes, what are increasingly nervous non-doms to do before April 2017? Much depends on their particular concerns and circumstances.

Long term resident non-doms

For those long-term UK resident non-doms who are most concerned about becoming deemed domiciled after April 2017, there may be merit in creating an offshore trust to hold their offshore assets. Pre-April 2017 trusts should continue to enjoy favourable inheritance tax treatment although the income tax and capital gains tax treatment of such trusts may change. That is one of the major issues on which further details are eagerly awaited.

For those who already have a trust which owns assets that have generated significant historic income and gains, it may be tax-efficient to receive trust distributions before April 2017. Similarly, where there are large unrealised gains in the trust, it may be worth realising those gains before April 2017 if that is practical.

Offshore structures for UK residential property

For those more concerned about the post-April 2017 exposure to inheritance tax of UK residential property held in an offshore company, it may now be time to start the process of dismantling the structure as it is unlikely to serve any useful purpose after 2017.

UK residents or those with a mortgaged property

Dismantling the structure can itself trigger a significant capital gains tax liability on historic gains where the shareholder or beneficiary is UK resident. Similarly, SDLT can be payable where there is an existing loan secured on the property. Although the Government originally suggested tax reliefs would be available on dismantling these structures, no details have been published. It may even be that the Government's earlier generosity comes to nothing. In such cases, a wait and see attitude makes more sense.

Non-UK residents without a mortgaged property

For those who are non-UK resident, and where there is no mortgage, there are no obvious advantages to delaying further. At least the initial steps towards a dismantling should be taken now, even if no final decision is made until the autumn or winter. Waiting any longer may result in not being able to find a suitable liquidator, or paying considerably higher professional fees, as we expect a rush next spring.

what action should you take next?

Although there is still no further clarity at this stage, non-doms should not assume the non-dom tax changes will be delayed or shelved. It makes sense to assume the changes will happen, use the available time now to take professional tax advice, and devise a plan of action. Where appropriate, non-doms should liaise with relevant offshore directors and trustees, who can provisionally instruct liquidators. The final button can be pressed when more details of the changes are available, hopefully no later than the autumn.

We will publish further editions of Countdown to 2017 over the coming months (click to see the First and Second editions). In the meantime, if you would like us to analyse your particular circumstances and advise on a tailored mitigation strategy, please contact Andrew Goldstone or your usual Mishcon de Reya tax contact.

Currently, mass-produced artistic works (i.e., where at least 50 are produced by an industrial process) have a shorter term of copyright protection compared to other artistic works.  The general term of protection for artistic works is 'life plus 70 years' (i.e., copyright expires 70 years after the end of the calendar year in which the creator dies).  However, industrially produced artistic works are currently only protected by copyright for 25 years from the end of the calendar year in which the work was first marketed. 

From 28 July 2016, the term of protection for industrially produced artistic works will be extended to 'life plus 70 years'.  This has potentially far-reaching consequences in many design-led industries, not least as certain works which had fallen out of copyright will now benefit from resumed protection.  Whilst the focus has been, in particular, on the implications for the replica designer furniture industry, this change in the law will also have consequences in other sectors including in art publishing. 

However, it is important not to assume that all industrially produced designs will be protected by copyright.  There is no statutory definition of what will qualify as a work of artistic craftsmanship (the most relevant category of artistic work) and the Government recognises in its guidance note on the change in the law that this is a complex issue and one that the Courts will no doubt need to review in the future.   Further, it is possible that some exceptions providing a defence to copyright infringement may be available in certain circumstances.  

background

Following an ECJ decision in 2011 (Flos v Semeraro), the UK Government considered that UK law on the length of protection for industrially produced artistic works was not in line with most other EU member states. Accordingly, it decided to repeal the relevant provision (section 52 of the Copyright, Designs and Patents Act 1988), initially setting a 5 year period for the repeal to take effect (i.e. until 6 April 2020).  However, following a judicial review challenge, the Government enacted a significantly reduced transitional period. The repeal of s.52 will now take place on 28 July 2016, with a transitional (i.e depletion) period ending on 28 January 2017, so that certain existing stocks can be sold.

impact of the change in the law

The Government's guidance note summarises the implications of the repeal of section 52 CDPA, for copyright owners, as well as businesses dealing in replica products.   

New industrially produced artistic works

From 28 July 2016, any new artistic work that has been industrially produced will be afforded the same length of protection as all other artistic works, i.e. life plus 70 years.

Existing industrially produced artistic works

Any industrially manufactured artistic work in which copyright had expired will resume copyright protection for the remainder of the 'life plus 70 years' period.  For example, an item of jewellery which is industrially produced may qualify as an artistic work as a work of artistic craftsmanship.  Assume the jewellery was first marketed in 1989 and the creator died in 2000: under the current law, copyright protection expired at the end of 2014; under the new law, copyright protection will resume and will now expire at the end of 2070.

Protection will also extend against reproduction of an artistic work in a 2D form, e.g. in photographs and images. For example, reproducing a photo of the jewellery in our example in a magazine could require a licence from the creator of the jewellery.   In addition to copyright protection, moral rights will also be available to protect against e.g., derogatory treatment of a copyright work.

Depletion period for certain existing industrially produced artistic works

The new rules provide for a 'depletion period' expiring on 28 January 2017. During this period copies of works which now fall back into copyright protection (because of the change in the law) may continue to be made or imported – but only where those copies were contracted before 16.30pm on 28 October 2015 (the publication date of the Government consultation).

The effect of this for companies dealing in (i.e., importing, making or acquiring copies) industrially manufactured artistic works is as follows:

Meeting the criteria as an artistic work

Whether an industrially produced work will qualify as an artistic work is not straightforward and each work has to be assessed on a case by case basis, depending upon the evidence.  The Government's guidance note sets out the factors that the UK courts might take into consideration when assessing whether a work qualifies as a work of artistic craftsmanship.  For example, it is not enough for the work to look attractive; it must have some real artistic or aesthetic quality (and must be a work of art or fine art) and must also be a work of 'craftsmanship' (i.e., involving special training, skill and knowledge for production).  Where the work's artistic expression is constrained by functional considerations (as will often be the case in relating to mass-produced designs), the guidance note suggests it is less likely to be a work of artistic craftsmanship.

Possible defences

There are a number of exceptions to copyright infringement which may allow companies to deal in copies of artistic works without the relevant permission. These include, for example, general fair dealing for educational purposes or for the purposes of criticism and review. The guidance note sets out further details on some potentially relevant exceptions, and also notes that some rights holders have indicated that they will not pursue actions against publishers in relation to 2D copies of their works where it contributes to their marketing or reputation. 

To read more about the IP services we offer please click here.

Natasha advises on all aspects of EU and UK competition law (including state aid), working on competition litigation, CMA and European Commission merger investigations, market studies and investigations, and sector inquiries. Prior to her role as an Associate at Pinsents, Natasha trained and then worked as an Associate at Taylor Wessing from 2007 to 2011.

Her appointment brings the number of lawyers in Mishcon's Competition practice to nine, including three partners. The group has been involved in a number of high-profile cases, including recently advising Sainsbury's on its successful competition damages claim against MasterCard in relation to unlawfully high interchange fees charged for card payment services in the UK. Other clients involved in related proceedings are Ocado and John Lewis.

Commenting on Natasha's appointment, Partner and Head of Mishcon de Reya's Competition Group, Andrij Jurkiw, said: "The Group has evolved since it launched with the hire of two partners and one associate back in early 2013. We now offer a fully comprehensive service to our UK and international clients, with breadth and depth on both defence and claimant matters. Natasha's expertise complements our existing offering – she is a fantastic addition to the team."

"There’s great appetite from clients already, but that’s not surprising as the technology helps us to do work better and faster. We are applying varying degrees of TAR on most projects and have run a significant number of full-blown predictive coding reviews.

"We launched Mishcon Discover (our in-house e-discovery offering, in partnership with Unified) earlier this year to capitalise on this wave of  interest. We’ve also been exploring the use of technologies across other parts of the dispute resolution process, developing a more complete ‘lit-tech’ strategy."

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The Upper Tribunal (UT) in Zipvit [2016] UKUT 294 (reported in Tax Journal, 8 July 2016) upheld in part the decision of the First-tier Tribunal (FTT) that the taxpayer was unable to recover VAT it claimed was embedded in amounts paid to Royal Mail for postal services. This was despite Proudman J criticising the FTT for going ‘off on a frolic of its own’ in incorrectly analysing some of the key legal principles at issue.

The facts in this case were as follows. Zipvit paid for postal services supplied by Royal Mail and was provided with an invoice, which stated that there was no VAT paid, as the supply was exempt (in accordance, purportedly, with article 13A(1)(a) of the Sixth Directive (now the Principal VAT Directive)).

The CJEU in TNT Post (Case C-357/07) subsequently clarified that the postal exemption for VAT which Royal Mail had been relying on was limited. It could only apply to supplies by the universal postal service operator operating as such; and, therefore, could not apply to services for which the terms had been ‘individually negotiated’. The ‘MailMedia’ services supplied to Zipvit were treated by Royal Mail as exempt, but were in fact, standard rated. !ere were, however, two main issues in dispute:

To view the full article, please click here.

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A recent decision from Europe's highest court has opened up the possibility of Courts ordering landlords to stop their tenants selling counterfeit products on their premises.  Whilst the case centred on a marketplace operator letting units to individual stall holders who went on to sell counterfeits, the principles in the decision could be extended to impose injunctions against landlords of shopping centres, as well as to other commercial landlords.

The war against counterfeit goods is a never-ending challenge for brand owners. Whilst, in recent years, attention has particularly focused on tackling online infringements - including those sold via auction sites and social media - physical marketplaces still provide fertile ground for fakes.  Rights holders can, and do, bring claims – both civil and criminal - against the sellers of these products, but this is not always straightforward, and there is a constant stream of new operators ready to take their place. So, it is no surprise that rights holders have turned their sights to intermediaries, including landlords who let their premises to tenants who sell counterfeits. 

In a significant decision, the European Court of Justice (CJEU) has now confirmed that a market operator who sub-lets stall units to stall holders selling counterfeit products is an 'intermediary' whose services are being used to infringe an intellectual property right. Rights holders can therefore seek an injunction against them, requiring them to stop sales of counterfeits - provided that the court granting the injunction is satisfied that certain criteria are met. Whilst this decision focuses on the liability of a market operator, the principles could be extended to other types of retail landlord, as well as 'intermediaries' more generally, and also goes beyond trade marks to other intellectual property rights such as designs. 

The CJEU was clear that intermediaries such as market operators did not have to exercise general ongoing oversight of their customers. However – and significantly - they may be forced to take measures to prevent new infringements of the same nature by the same trader. Following this decision, market-operators and other landlords will need to be even more alive to the risk that fake products could be on sale on their premises, given that proceedings may now be brought against them for an injunction based on this decision. Landlords should therefore be ready to take prompt action, including possible lease termination, if they learn that counterfeits are being sold on their premises. This decision also reinforces the importance of conducting due diligence on new tenants and ensuring that appropriate termination provisions are included in leases. 

The case was brought in the Czech Republic by a number of brand owners, including Tommy Hilfiger and Burberry, against Delta Center. Delta is the tenant of the Prague Market Halls and it sub-lets pitches to individual market traders. Its terms require its sub-tenants to respect its regulations; it also issues a warning notice which states that counterfeits are forbidden and that their sale may lead to a termination of the rental agreement. Having discovered a number of counterfeit versions of their products being sold in the Prague Market Halls, the brand owners applied for an injunction against Delta Center. In particular, they wanted an order that Delta should stop entering into contracts with market-traders where a court or administrative authority had decided that those traders had infringed the brand owners' trade marks, or there was a risk of them doing so.

The claim was brought under the Czech law, implementing Article 11 of the Enforcement Directive. Article 11 states that Member States must provide right holders with the ability to seek an injunction against intermediaries whose services are used by a third party to infringe. The Czech Supreme Court asked the CJEU to determine whether market-operators like Delta Center are an intermediary for the purposes of Article 11. The CJEU has previously considered this issue in relation to e-commerce and online marketplaces, in a claim brought by L'Oréal against eBay. In the Delta decision, it has applied these same principles to physical markets, confirming that the scope of Article 11 is not limited to online intermediaries.

The Czech court will have to decide on the terms of any injunction it should award against Delta. An injunction will not necessarily be granted against an intermediary in every case – the Court must be satisfied that it is effective, dissuasive, equitable and proportionate, and that it will not lead to excess expense or create barriers to legitimate trade.

To view the full article, please click here.

If the mass retreat of City firms from private client work in the 1980s and 1990s looked like folly when Mishcon de Reya, Forsters and others began to leverage their practices with commercial success during the recession, it looks like even more of a mistake today. With trusts and estates at the heart of some of the biggest global disputes currently, firms with significant commercial litigation practices have taken note.

Please click here to read full article (subscription only).

This article in Bio-Science Law Review (Volume 15, Issue 3) reviews the framework for injunctions in pharmaceutical cases, and identifies some of the key aspects of the Unified Patent Court.

Click here to review the whole PDF of the article.

At Clyde & Co, Martin's work had a particular emphasis on trade and investment with the Middle East and North America. Prior to that, he was Partner and headed the International team at Howard Kennedy.

Having lived and worked in the Middle East for many years,  Martin deals with a wide range of matters for leading Middle East and other international clients, advising on inward investment to the UK and globally on behalf of family offices in London and other European countries. He also assists UK, US and other corporate clients seeking to do business in Saudi Arabia, Qatar and the wider Gulf. In addition to being an experienced international business lawyer, advising leading families and their companies on all aspects of international private capital, he is regularly involved in substantial real estate and hotel transactions, as well as high profile dispute resolution. Martin successfully represented a prominent member of the Saudi Arabian Royal Family in a recent high profile Court of Appeal case, having acted for the family for many years. 

Commenting on Martin's appointment, James Libson, Head of Mishcon de Reya's Private department, said: "We are very excited that Martin is joining us, his client base and the way that he looks after them complements the Mishcon Private approach. His geographical reach, particularly in the Middle East, will make him a fantastic addition to our team."

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The declaration can be made by the owners of registered EUTMs which qualify because they:

• were filed before 22 June 2012 and were registered before 23 March 2016; and
• cover an entire class heading.

For International Registrations designating the EU, the International Registration must have designated the EU before 22 June 2012, and have been the object of a second republication by the EUIPO before 23 March 2016.

What action should brand owners now take?

Brand owners should identify marks in their portfolios which may qualify because they were filed before the relevant date and cover an entire class heading. If they do own qualifying marks, a declaration can then be filed confirming that their intention on filing had been to seek protection for goods and/or services which go beyond those covered by the literal meaning of the class heading. If a declaration is not filed by 24 September for qualifying marks containing a class heading, from that point the class heading will be given its literal meaning only.

For brand owners deciding whether to file a declaration, much will depend on their EUTM filing strategies before 22 June 2012: i.e., did they routinely file for class headings or did their specifications contain specified terms, or did they file for class headings plus specified terms? Where class headings have been used, it will be necessary to compare, on a class by class basis, the guidance concerning those goods and services that the EUIPO considers are not covered by the literal meaning of a class heading as against the actual or intended use of the mark. If this reveals a potential gap in the scope of the protection, the brand owner should file a declaration before 24 September (the process is explained further below). For some brand owners, however, it may be too onerous to carry out this process on a mark by mark basis, in which case it may be simpler to file a blanket declaration across all qualifying marks in a portfolio.

We would be very happy to discuss with you whether any of your marks for which we are representative qualify for a declaration and, if so, whether a declaration should be made. 

If you would like to discuss this with us further, please contact Sally Britton.

BACKGROUND

The background to this issue lies in a decision of the European Court of Justice in June 2012 - IP Translator - concerning the proper interpretation of class headings in trade mark specifications, which led to a change of practice at the EUIPO. The EUTM reform package, which came into effect in March 2016, codified the IP Translator decision: whilst class headings may still be used in trade mark specifications, they must be clear and precise. Further, protection will extend only to the literal meaning of the relevant indication or term. This 'means-what-it-says' approach applies to all new applications, but also applies to all EUTMs that were filed after 21 June 2012 (the date of the IP Translator decision). However, it was recognised that there should be a mechanism for those EUTM owners who had filed applications using class headings based on the EUIPO's previous practice that class headings covered all goods and services.  

Accordingly, for EUTMs filed before 22 June 2012, that are registered in respect of all the general indications of a class heading, a literal interpretation will be applied, unless the owner files a declaration (called an Article 28(8) declaration) before 24 September 2016.  In that declaration, the owner can confirm that, on filing the application, it intended to seek protection for goods and/or services going beyond the literal meaning.

Guidance on Article 28(8) declarations

The EUIPO has issued useful guidance materials, including:

• Communication No 1/2016 concerning the implementation of Article 28

• Frequently Asked Questions

In addition, it has published a non-exhaustive list of terms which it considers are clearly not covered by the literal meaning of the relevant class headings. It has also now published a further non-exhaustive list which includes terms which it considers are not clearly covered by the literal meaning of the relevant class heading (i.e., where there may be some doubt as to whether the term is covered or not by the literal meaning): 

• Example terms clearly not covered and not clearly covered by the literal meaning of the relevant class headings

Which marks qualify for a declaration?

• The EUTM must have been filed before 22 June 2012 and the registration must cover at least one entire class heading. However, it does not matter if there are additional goods or services over and above the class heading, provided that the language does not limit or disclaim in any way the general indication.   
• For an International Registration designating the EU, the applicant must have designated or subsequently designated the EU before 22 June 2012 and the mark must have been the object of a second republication by the EUIPO by 23 March 2016.

What can the declaration cover?

• The declaration can only be for goods and services which were in the relevant edition of the Nice Classification alphabetical list when the application was filed. 
• The goods and services declared must go beyond the literal meaning of the relevant class heading.  The EUIPO will accept declarations for goods and services that are clearly not covered and also those that are not clearly covered.  For each mark and specification, the lists published by the EUIPO give non-exhaustive guidance as to what may be claimed for the relevant class based on the Nice classification edition in force at the time of filing. 
• The EUIPO has issued an online form, but this only allows declarations to be filed in relation to single marks. However, for multiple declarations, a brand owner can use its own document. There is no EUIPO fee to file a declaration.   

What are the implications of making a declaration? 

• Any goods or services that are declared will be subject to the genuine use requirements from their filing/priority date. This is an important consideration as many of the marks which will qualify are likely to be subject to proof of use requirements.  
• Any goods or services contained in a declaration cannot be relied upon in infringement proceedings against use which began before the declaration was entered in the Register, and which would not have infringed the relevant mark on a literal basis. Similarly, declared goods/services cannot be used in opposition/invalidity proceedings against a later mark which was in use or was filed before the declaration was entered in the Register, where the use would not have infringed the mark on the literal basis at that time. These defences should be borne in mind when filing the declaration but, of themselves, are not likely to mean that a declaration should not be filed.

Partial surrender 

As an alternative to filing a declaration under Article 28(8), a brand owner may file a partial surrender. Under this process, the entire class heading can be deleted and replaced with the goods and services listed in the alphabetical list (whether covered by the literal meaning or not), provided that at least one good or service is removed. This will result in a very long trade mark specification, and could present issues in relation to genuine use. In contrast, with an Article 28(8) declaration, the trade mark owner retains the class heading, but can choose to declare its intention to include other terms that are not covered by the literal meaning. 

To read more about the IP services we offer please click here.

Since the event, the signatories to the Women in Finance Charter to-date have been announced. The Charter sets out commitments based on the recommendations in Jayne-Anne Gadhia's Review. 

There are already 72 signatories to the Charter, representing half a million staff; this is approximately half of all staff across the breadth of the financial services sector. This level of engagement is encouraging and suggests that the time for change may indeed have come.

The accreditation demonstrates our commitment to supporting the continued professional development of our people, and is the first of what we hope will be mutually beneficial partnerships with professional bodies through the Academy.

For more information please click here.

This is the first judgment to be given in a raft of litigation being brought by numerous high-street retailers in the UK and Europe, alleging that MasterCard and Visa charged anti-competitive and excessive debit and credit card fees, and seeking combined damages of more than £1.2 billion. The disputes follow a subsequently overturned US settlement in 2012 in which Visa and MasterCard agreed to pay US retailers $7.25 billion – the largest antitrust settlement in US history.

Sarah Houghton, a Partner at Mishcon de Reya representing Sainsbury's, said:

"This is a good result for our client in a landmark case. This marks the first substantial award in a competition damages claim in the UK, and we believe in Europe.  It has an importance well beyond the precedent it sets for claims against the MasterCard and Visa schemes."

Rob Murray, a Partner at Mishcon de Reya representing Sainsbury's, added:

"From the outset, we took a unique position in terms of our case strategy - Sainsbury's was the only claimant to streamline its claims in order to avoid getting embroiled in unnecessary or unwinnable preliminary issues. For example, it claimed only for a six-year period, rather than from 1977 as the other claimants did. As a result of our strategy, Sainsbury's has received judgment on all issues at least two years before the claims brought by other retailers involved in the wider litigation.

"The judgment is good news for the other retailers involved who will be able to rely on the Tribunal's findings."

Other retailers include Ocado, which instructed Mishcon de Reya in 2014, and John Lewis, which instructed Mishcon de Reya in June 2016 to take over the conduct of their competition damages claims in the English High Court against the MasterCard and Visa payment card schemes.

Rob Murray and Sarah Houghton, both Partners in Mishcon de Reya's Competition group, led the team advising Sainsbury's, alongside Jonothan Broadbent (Associate) and Zachery O'Brien (Associate). The team instructed Brick Court’s Mark Brealey QC and Sarah Love, One Essex Court’s Derek Spitz, and expert witnesses, Nils von Hinten Reed and Paul Reynolds, of CEG Europe.

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However, the recent vote in the UK's Brexit referendum will have a significant impact on the new system and could even mean it will never come to life at all. Such an outcome would be extremely disappointing, not least given the extensive negotiations and preparations in recent years, but also in view of the benefits the new regime would have brought; albeit holders of standard European Patents were expected, at least in the early days, to opt their patents out of the new system. However, the current position is unclear as political negotiations will take some time to resolve and it is possible that some agreement may be negotiated which will allow the UK to continue to participate in the new regime. 

At the very least, the majority vote to leave will lead to substantial delays in implementation, and possible changes to the framework of the new system.  And, even if it goes ahead without the UK's involvement, the absence of a major market will mean that businesses may simply decide against using it.

In the meantime, the UK is and will remain a member of the European Patent Convention and standard European Patents will continue to have effect and be enforceable in the UK. 

As the position relating to the UK and its relationship with the EU develops over the coming months, we will report further on developments in relation to the impact on the proposed new regime.

OVERVIEW OF THE UNITARY PATENT AND UPC

The Unitary Patent

The Unitary Patent will be a single patent applied for following one central application at the European Patent office (EPO).  It will have effect in all EU Member States that ratify the UPC Agreement, which will govern the UPC regime. Even before the Brexit vote, however, not all Member States had intended to participate in the Unitary Patent, most notably Spain which unsuccessfully challenged the Unitary Patent before the European Court of Justice (CJEU).

The Unitary Patent will be available alongside the existing regime for standard European Patents granted under the European Patent Convention and national patents (subject to national rules relating to 'double patenting').

Since 1977, it has been possible to obtain (potential) EU-wide protection by filing a single application at the EPO. If granted, however, the applicant does not obtain a single unitary patent; instead, it obtains a 'bundle' of national patents covering those member states of the European Patent Convention (EPC) which they designate. The EPC is made up of 38 states, including all EU Member States, and a number of other European countries. If the UK does leave the EU, it will remain a member state of the EPC; therefore Brexit will have no impact on the system for obtaining standard European Patents.

Securing protection via the EPO is not without its challenges. Costs can be significant and, because the patentee obtains a bundle of national patent rights, it must enforce them on a country by country basis. Not only does this mean that enforcement can be expensive, it gives rise to potentially inconsistent judgments between national courts. A key selling point of the Unitary Patent is its pan-EU effect (or, more accurately, across those Member States that sign up). This means that it can be enforced across participating Member States through a single court action; but it can also be invalidated in those same Member States in one fell swoop. The other key benefit is the potential for significant costs savings, although in practice whether the Unitary Patent will be cheaper than a standard European Patent designated in relevant states will depend upon the number of Member States where protection is sought.  In many cases, applicants will prefer to obtain standard European Patents or, indeed, national patents.  

The Unified Patent Court

The UPC will exclusively govern disputes concerning the Unitary Patent (and related Supplementary Protection Certificates) from day one. However, it will also have jurisdiction over existing and future standard European Patents. Ultimately, it will have exclusive jurisdiction over standard European Patents but there is an important transitional period which means that this exclusive jurisdiction may not kick in for some time.

The transitional period is for seven years after the UPC Agreement comes into force (it may be extended by a further seven years). During this period, the UPC will share jurisdiction over standard European Patents with the national courts, provided those patents have not been opted out of the UPC. During the transitional period, holders of existing standard European Patents (and ones granted during the transitional period, together with related SPCs) can opt those patents out of the UPC regime for the life of the patent. Significantly, they can potentially opt those patents back in again when it is to their advantage e.g. when they wish to obtain pan-EU relief.  

Timescales for implementation pre-Brexit

The Unitary Patent will only become available once the UPC Agreement is in force: this will occur once the UPC Agreement has been ratified in at least 13 EU Member States. The ratifying states must, presently, include France, Germany and the UK (on the basis that they are the three Member States with the highest number of European Patents in the year preceding the UPC Agreement being signed). The process of scrutiny and ratification of the UPC Agreement has been ongoing at the Member State level over the last couple of years, with ten Member States having ratified as at July 2016 (including France). Despite the prospect of the EU referendum, the UK had been progressing its preparations for ratification. Indeed, both the UK and Germany had expected to be in a position to ratify in early 2017, once the system was ready to 'go live' (i.e., in relation to key issues such as IT, Court facilities and training of judiciary).  

Will the UPC/Unitary Patent be derailed by the Brexit vote? 

Following the outcome of the UK's EU membership referendum, the future of the project is in serious doubt.   However, it is not possible to state with certainty at this stage how things will progress as there are a number of significant political issues to resolve, including the model that may be negotiated and agreed for the UK's ongoing relationship with the EU.  In particular, one of the potential exit options is for the UK to join the Economic European Area (EEA) which may then provide scope for some negotiation over continued involvement in the UPC system. 

If the UK does leave the EU, there will be no impact on the current system of obtaining and enforcing standard European Patents, as it will remain a member of the EPC. However, there will be major implications for the Unitary Patent. 

First, as a non-EU country, unless there is some negotiated agreement in place, the UK will not be able to participate in the Unitary Patent (and the Unitary Patent will therefore not extend to the UK).  However, until the UK leaves the EU (which could be at least two years away, if at all), it remains possible for it to ratify the UPC Agreement and join the UPC regime, so as to get it up and running, even whilst in the process of negotiating its exit from the EU. Further, it is possible that the UK could seek to enter an arrangement which would allow it to participate in the UPC, at least in respect of standard European Patents (albeit this would involve recognising supremecy of EU law). As noted, in advance of the referendum, the UK Government had been proceeding on the basis that ratification of the UPC Agreement would still take place, and was on track for early 2017. However, these presently seem like unlikely outcomes.

If the UK does step out of the picture, its role of mandatory ratifying state could be taken by Italy. Accordingly, once 13 Member States have ratified, the new regime could still come into effect without the UK being involved but this would not be straightforward.   At the very least, there would be further delay in implementation, and many aspects (e.g., fees) are likely to need further consideration and re-negotiation. More significantly, with a major market no longer included, both the Unitary Patent and UPC will simply not be as attractive as they would have been.  

A further complication is that the UK had been the intended location for the section of the Central Division dealing with cases relating to pharmaceutical patents. This will have to be the subject of further discussion and consideration. 

All of this tends to suggest that the UPC/Unitary Patent faces significant hurdles before it can now come into effect. Even if it can do so, 2017 is very unlikely as a start date. The EPO President Benoît Battistelli has recently published a statement on the implications of the Brexit vote. Whilst his message is that "whatever decisions are taken at a political level it can be expected that the system will go ahead", he suggests that a "best case scenario" would be for the UK to ratify the UPC Agreement and then, in its exit negotiations, to seek to agree its continued participation in the new regime. We will continue to provide updates as information is made available. 

Please click here for a detailed overview of the proposed Unitary Patent and Unified Patent Court regime.

To read more about the IP services we offer please click here.

As we have discussed in previous blog posts, as of 6 April most UK companies and LLPs have had to maintain a “register of people with significant control” (PSC register). From 30 June the information on those PSC registers is starting to become publicly available, as the time comes for the relevant company or LLP to file its “confirmation statement” (which replaced the annual return) at Companies House.

Not all EU member states had been planning to follow the UK’s public register approach to beneficial ownership disclosure. Proposals to amend 4MLD and the First Company Law Directive, announced on 5 July, look likely to change that. The proposed amendments would also mean that the corporate transparency regime in the UK would become stricter for certain corporate entities.

Read the full article here.

The Leap 100 2016 is a list of the most exciting, fast-growth companies in the UK, compiled by Mishcon de Reya and City A.M., with experts from The Supper Club, Seven Hills and The Entrepreneurs Network.

The results of the poll, plus an article featuring YPlan’s co-founder Rytis Vitkauskas on pitching to Ashton Kutcher, and a column by Mishcon de Reya Corporate Partner Dean Poster on why raising finance carefully is more vital than ever post-Brexit, have been published alongside other features.

Click here to view a PDF of the two page feature in today's paper. 

Stay up to date with the latest The Leap 100 news on Twitter @TheLeap100, #TheLeap100

There is no doubt that interest in class actions in the UK is at an all-time high. In this article, we look at the drivers and trends behind this, and look ahead to how things might develop. Are times really changing?

Click here to view the article (pages 3 -6)

In the last five years or so, the UK courts have granted a number of website blocking orders against ISPs requiring them to block access to websites which engage in or facilitate copyright infringing activities. Website blocking orders have been particularly attractive to the entertainment and sports broadcasting industry - orders have been sought by film studios, record companies and the FA Premier League. The Court of Appeal's decision extending this jurisdiction to websites selling counterfeit products based on trade mark infringement is, subject to any appeal by the ISPs to the Supreme Court, an extremely significant development for brand owners in their ongoing fight against counterfeiting. 

The Court recognised that the ISPs were not guilty of any wrongdoing: they had not infringed the trade marks nor engaged in a common design with the website operators. However, the Court said that the target websites relied upon their services in order to offer their counterfeit products for sale to UK consumers and so the ISPs were inevitable and essential actors in those infringing activities. Accordingly, whilst the ISPs did not owe any duty of care to brand owners to ensure that their services were not used for infringing purposes, once they became aware that their services were being used to infringe an IP right, they did have a duty to take proportionate steps to assist the person wronged when requested to do so.

background

The jurisdiction for making a blocking order in relation to websites infringing copyright stems from Article 8(3) of the Information Society Directive, which is implemented in the UK by section 97A of the Copyright, Designs and Patents Act 1988. There is no similar provision in EU or UK law in respect of websites selling counterfeits that infringe trade marks. However, Article 11 of the Enforcement Directive provides that Member States should ensure that rights holders can apply for injunctions against intermediaries such as ISPs whose services are being used to infringe IP rights. Unlike the copyright regime, the UK has not adopted specific legislative provisions to implement Article 11 but the Court has the power under section 37(1) of the Senior Courts Act to grant an injunction where it is just and convenient to do so.

In 2014, following an application by Richemont, Arnold J made a website blocking order against the five main retail ISPs requiring them to block their customers' access to six target websites, all of which offered for sale counterfeit goods exclusively of a certain brand eg Cartier, Mont Blanc etc. The order was made subject to certain safeguards. HHJ Hacon made an order in respect of further websites in February 2016. The ISPs appealed to the Court of Appeal on a number of grounds.

result

Jurisdiction

Kitchin LJ gave the judgment of the Court of Appeal. He confirmed that there was jurisdiction to grant website blocking orders in relation to websites selling counterfeit products - Article 11 provided a principled basis for extending the Courts' practice in relation to the grant of injunctions to encompass, where appropriate, the services of an intermediary which has been used by a third party to infringe a registered trade mark. The decision to grant an injunction in this type of situation - subject to the threshold conditions being met - demonstrated, the Court said, the Courts' willingness to adapt to new circumstances by granting injunctions where it was necessary and appropriate to do so to avoid injustice.

Threshold conditions

There are four threshold conditions for making website blocking orders. The Court of Appeal said that each was satisfied in this case:

• The ISP is an intermediary
• The operators of the target websites were infringing the trade marks
• The operators of the target websites were using the ISPs' services to infringe
• The ISPs had knowledge of this

The Court's consideration of the third condition, i.e., whether the operators of the target websites were using the ISPs' services to infringe, is particularly interesting because a point of difference can be identified with the copyright line of cases. With websites infringing copyright, the infringing work is itself physically transmitted using the ISPs' service. The ISPs argued that, in relation to websites selling counterfeit products, the substantive act of infringement, namely the supply of counterfeit goods, is performed by post or courier, i.e., not using their services. The Court of Appeal rejected this argument; it was clear that Article 11 was intended to ensure that right holders other than copyright owners could seek an injunction against an intermediary whose services were used to infringe IP rights. Both the copyright regime and Article 11 were intended to deal with providers allowing their customers to access infringing materials on the internet, regardless of whether they actually exercised any control over the services their customers used. Further, there did not have to be a specific relationship between the ISPs and the website operators. 

The ISPs' services were, the Court said, being used by the target websites in the following ways:

• They allowed consumers in the UK to access the target websites
• They were used to communicate to consumers in the UK the advertisements and offers for sale of counterfeit items
• They were used to make the agreements to sell and supply counterfeit items to consumers in the UK

The website operators' infringing activities did not come to an end simply when the offending materials had been uploaded to the website hosts. 

Principles when making a website blocking order

The Court also considered a number of arguments in relation to the principles that must be applied when considering whether to make a website blocking order. In particular, it noted that website blocking orders did not have to lead to a complete cessation of the infringement. However, such measures must at least have the effect of making access to the target website difficult to achieve and of seriously discouraging internet users from accessing it.

A particularly interesting discussion centred on the proportionality of website blocking orders, which involves a consideration of the conflict between right holders' IP rights, ISPs' freedom to conduct business and internet users' freedom of information. Arnold J had considered that the key question was whether the likely costs burden on ISPs was justified by the likely efficacy of the blocking measures, having regard to the alternative measures available and the substitutability of the target websites. After "some hesitation", he concluded that it was justified but, on appeal, the ISPs made a strong attack on his assessment.

One aspect focused on the cost of implementing blocking orders. To date, the courts have taken the approach that right holders should bear the costs of making the application, assuming the order is unopposed, and ISPs the costs of implementation. Where applications are unopposed, the costs have been identified as approximately £14,000 per website. The costs for implementing a single website blocking order, meanwhile, are modest but the cumulative costs of implementation, including capital outlay, are far more significant. Further, Arnold J accepted that his decision could open the door to similar applications by right holders and so ISPs' implementation costs would therefore increase. 

The ISPs' position was that, as it was accepted they were innocent of wrongdoing, implementation costs should be borne by right holders - including the marginal costs and an appropriate contribution to the capital costs of the necessary technical systems. The majority of the Court of Appeal said Arnold J was entitled to say the ISPs should bear the implementation costs, but that this was a matter to be kept under review in future applications. Briggs LJ disagreed in respect of the costs of implementing a particular order - as opposed to capital costs - drawing an analogy with Bankers Trust type orders (orders sought against banks in relation to tracing claims) and Norwich Pharmacal orders. He suggested that, for a right holder, liability for implementation costs was the price for obtaining valuable injunctive relief for the better exploitation of its intellectual property. In contrast, the majority saw implementation costs as a "cost of carrying on business in this sector" for ISPs, in return for the immunities they enjoy from infringement under the E-Commerce Directive. 

The Court of Appeal also said that Arnold J was justified in identifying the legislative policy behind the regime as based on an economic logic in granting injunctions against intermediaries: it was economically more efficient for them to take action to prevent infringements using their services than to require right holders to take direct action against the websites themselves. However, this did not mean that it would be proportionate to make a blocking order in every case.

why is this important?

Online counterfeiting is a major headache for many brand owners. Given the inherent defects in the existing available remedies, such as notice and take down procedures, the Court of Appeal's endorsement of the extension of website blocking orders in this decision gives them a further weapon to deploy.  

The Court's decision also demonstrates the willingness of the UK judicial system to adapt its practices, here in relation to injunctions, to new circumstances where it considers it is necessary and appropriate. It might be interesting to speculate, however, as to how a Court would have dealt with this question in a post-Brexit world given that the relevant provisions under consideration on this issue all stem from EU law. 

The day after the Court of Appeal's decision, the European Court of Justice (CJEU) issued a decision which also demonstrates the potential wide-ranging reach of Article 11 in relation to intermediary liability. On a reference from the Czech Republic Supreme Court, the CJEU confirmed that the scope of the provision extended beyond e-commerce - and ISP intermediaries - to physical marketplaces. In particular, a market operator who lets pitches from which counterfeit products are sold should be included within the definition of an 'intermediary' whose services are being used by a third party to infringe an IP right. They can therefore, like ISPs, be the subject of an application for injunctive relief by a right holder. The CJEU did not comment on the nature of that injunctive relief which, in this case, will have to be determined by the Hungarian court. The CJEU's decision also no doubt opens the way for potential claims against other intermediaries whose services may be used by infringers. 

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Vestra Wealth has £5.6bn of assets under management, and offices in London, Bristol and Jersey. The executive partners will continue to own the remaining stake in the UK wealth manager, which has been renamed LGT Vestra, following receipt of regulatory approval and completion of the transaction.

LGT is the world's largest private bank and asset manager owned by a single family. The deal is the latest in a series of transactions that have seen it expand into Hong Kong, Singapore and Dubai as well as Switzerland and Austria.

Analysts said the transaction reinforced the continuing attractions of discretionary wealth managers, as firms seek to acquire new assets and spread the cost of meeting regulatory requirements.

The advisory team at Mishcon Corporate was led by Michael Nouril and Allison Keyse and assisted by Rajiv Kakkad. Regulatory advice was provided by Tim Flood and Charlotte Davidson, with tax advice provided by John Skoulding and Ceri Stoner.

In remarks just six days after the June 23 referendum in which the U.K. voted to leave the EU, French President François Hollande said that London would not be able to carry out clearing of euro-denominated transactions in future. While his remarks have no immediate impact on transactions totaling about $1 trillion a day, lawyers said the writing may now be on the wall for a business which the U.K. has already had to defend from eurozone ambitions in the past.

"No one's going to do us any favors: the French, the Germans and others have been champing at the bit to get hold of the euro clearing system, and I think this gives them a perfect opportunity. And I'm not sure there is a huge amount that we'd be able to do about it," Masoud Zabeti, head of finance and banking disputes at law firm Mishcon de Reya, said in an interview.

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