With the recent cyber spying scandals, Internet governance and the Internet Corporation for Assigned Names and Numbers’ (ICANN) role have been much debated.
In February 2014, ICANN’s President and CEO, Fadi Chehadé, presented the idea of creating a parallel international structure similar to ICANN which would have a non-governmental organization (NGO) status. It was during a trip to France that Fadi Chehadé emphasized the need for ICANN to have an international structure in order to become more open and accepted around the world.
The choice of location in Geneva as a base for this new international structure would award it a more neutral setting and escaping US-centric governance. This would also participate in enhancing ICANN’s global legitimacy.
A new structure in Geneva would bring closer ICANN and the International Telecommunication Union (IUT). For some, IUT would compete with ICANN, therefore creating rivalry. However, IUT’s General Secretary, Hamadoun Touré, stated the Union doesn’t aspire to global Internet governance.
Following Fadi Chehadé’s announcement, on March 14, 2014, ICANN announced its transition from an American governance to a more globalized one. This seems to comfort the idea that ICANN is moving towards becoming a NGO.
ICANN wishes to engage a dialogue between Board members and the Community on this topic, particularly during its meetings.
Dreyfus will be attending the next ICANN meeting in London at the end of June 2014 in order to keep you closely informed of the coming changes.
While the U.S. Congress published in February a report about the lawfulness of Bitcoin, the first electronic money still raises many questions across the world. Its quoted price, which was below $1 until 2011, had risen to more than $1,000 in the previous months and is now quoted between $200 and $400. Judicial, tax and other authorities in all countries are studying this crypto-currency to understand its modus operandi. The ultimate aim is to consider all the ins and outs before introducing appropriate legislation. There are reasons to be concerned but Bitcoin is not elusive as it may sound. Below is an overview of the currency in 4 questions.
How does Bitcoin work?
Bitcoin is a peer-to-peer electronic cash system. It relies on the principles of cryptography to validate transactions and generate currency. In short, Bitcoin is a means of payment and a decentralized currency since it does not rely on any central server. The computers of users help the system run by connecting to the network: some will generate “money”, while others will validate the transactions…
The use of cryptography means that Bitcoin transactions are entirely anonymous. Thus, a transaction between a buyer and seller is not made in the traditional way: the buyer loses Bitcoins, but the same Bitcoins are not credited to the seller. The latter will receive the same amount of Bitcoins lost by the buyer, this being the price of the transaction. There is however no flow of money between the buyer and the seller, which allows for complete anonymity.
What are the concerns raised about this system?
Anonymity is the main concern for the authorities. Money laundering, illegal sales and trafficking of all types are some of the transactions which Bitcoin seems to allow. As soon as April 2012, the FBI published a document expressing its concerns that the system may be used for illegal activities, which are most often untraceable.
For example, on Silk Road, a marketplace accessible only through the anonymity network TOR, all transactions are carried out in Bitcoins. Silk Road is mainly used for the sale of narcotic substances, fake identification documents and counterfeit products. Buying on this site is therefore risky and may even prove to be dangerous for the clients since the site also markets counterfeit medications. The only limit imposed by Silk Road is that it prohibits the sales of weapons and child pornography products.
At the instigation of the U.S Senate, Silk Road was closed down in October 2013 by the FBI before reopening some days later. The platform is still operational and trafficking is still ongoing.
What is the legal status of bitcoin?
Legally speaking, Bitcoin cannot be treated as a lawful currency. The right to issue money is a sovereign power. It is therefore only natural that as of now, no State has recognized the Bitcoin as a currency unit in its legal system.
Bitcoin is also not an electronic money, which is defined in the European Union in a 2009 Directive as: “electronically, including magnetically, stored monetary unit as represented by a claim on the issuer which is issued on receipt of funds for the purpose of making payment transactions (…) and which is accepted by a natural or legal person other than the electronic money issuer”. As Bitcoin transactions are not carried out between two persons, there is no issuer. Besides, Bitcoin is not an electronically stored monetary unit. Hence, the European Directive is not applicable.
Some see Bitcoin as a “parallel” or “anarchistic currency” while others see it as a simple unit of monetary measure. As for U.S. tax agencies, they announced on 25 March that Bitcoin will be treated as an asset rather than a currency. This will allow for the purchases and sales of Bitcoin to be subject to taxes.
Finally, is it legal?
As such, it is difficult to state that the Bitcoin is illegal. It is only the ways in which it is used that may go beyond what is legally permissible and may be characterized as a criminal offense. Whilst Silk Road was used as an example here, various sites use Bitcoin to sell goods and services which are perfectly legal.
In France, the Senate held hearings in January 2014 focussing on the opportunities offered by this technology and on the way the law could evolve to further regulate it. The status of Bitcoin is more advanced in Germany. The German government has set a 25% ceiling for income tax on Bitcoin income and has categorized it as a private currency.
Only Thailand has entirely prohibited the use of Bitcoin in its territory till date.
Established in 2009, Bitcoin is however already outdated from a technical point of view. Having been replaced by technologies that are based on lighter and more secured infrastructure, the Bitcoin is probably dying out. The next issue will be how States can react to these new exchange units.
June 2014 – During the ICANN50 in London, a surprising statement was made. It was announced that released domain names from the Name Collision list would not be subject to a Sunrise period, therefore depriving trademark owners from the possibility to defend their rights.
A name collision occurs when users unknowingly access a name that has been delegated in the public domain name when the user’s intent was to access a resource identified by the same name in a private network such as an intranet. It creates a risk of mass confusion for users and machines, hence their registration is prohibited.
Collision list names should not be confused with Reserved Names, which are an imposed list of names to be excluded from new gTLD registrations. “These reserved names include strings that are for Country Code Top Level Domains (ccTLDs), ICANN-related names (such as ICANN), IANA-related names (such as example), and names that the registry operator can use in connection with the operation of the TLD” says ICANN. The rules regarding these names’ release have already been discussed and ratified. Indeed, they are subject to Sunrise only if it is still running, otherwise the only remedy will be a claims notice.
The absence of sunrise period can be seen as a loophole to the rights protection mechanisms (RPM), which enable trademark holders to protect their rights during the new gTLD program. Sunrise provides for trademark holders a possibility to preregister names that are the same or similar to their trademarks in order to avoid cybersquatting. This special period takes place prior to the general launch and the IPR owner must be able to prove their prior right to the name to register the TLD.
As a defense to the lack of RPM without the Sunrise period, it was contended that the URS procedure is an adequate protection. However, many practitioners claim that these actions aren’t as efficient to protect IPRs as Sunrise periods, thus explaining the low number of IPR owners resorting to URS procedures.
Because many consider URS actions not to be sufficient, protests can be expected regarding ICANN’s decision not to submit released collision list names to Sunrise, however the outcome remains uncertain.
Dreyfus attends ICANN meetings in order to keep you closely informed of the coming changes.
For the past few years, businesses choose to affix the indication “Made in France” on their products. It consists of a marketing strategy and a competitive advantage since consumers are increasingly attentive and sensitive on the origin of the products they buy.
Today, only food products imperatively bear the indication “Made in + Country” to protect consumers. These are subject to strict regulation in the European Union. However, businesses manufacturing products like textile materials are free to use or not this indication as commercial argument. Indeed, European authorities advocate freedom to trade and free of movement of goods for these types of products. The jurisprudence of the Court of Justice of the European Union authorises national legislations to solely set up optional markings. The “Made in” is thus undefined, facultative and difficult to control.
In the absence of regulation, the manufacturer must bear the risks if he decides to affix the indication “Made in France” on his products. He must ensure that he is respecting the provisions of the Consumer Code and of the French Customs Code in order to protect the consumer.
Furthermore, the manufacturer or importer must be able to prove that the product has entirely been manufactured in France or that the ‘final substantial transformation’ has been carried out in France (Article 24 of the Community Customs Code).
Finally, the prudent and diligent manufacturer must provide the necessary documentation to legitimate the indication “Made in France” affixed on his manufactured products. This documentation shall be clear and intelligible because it aims at informing consumers on the origin of the product.
To protect both consumers and manufacturers, it would be appropriate to consider a European regulation for the manufactured products.
Since the revelations in the Edward Snowden case and the discovery of the Heartbleed flaw which led to the massive theft of personal data, hackers are very much in the news. But now, web hackers are starting to target lawyers and other legal professionals who are supposed to ensure that their clients’ information is duly protected.
The “hacking” consists of a discreet exchange of illegal and/or personal information by breaking into a network. This is becoming common practice and should constitute a real threat, not only to businesses, but also to States, in the years to come. According to the head of Israeli military intelligence, hacking will soon become “the greatest evolution” in warfare techniques, greater than gunpowder or air forces. And this is a matter of great concern for legal professionals.
Indeed, more and more clients are requesting firms to adopt additional measures to monitor their networks and thus prevent the leakage of confidential or valuable information, such as trade secrets. Another major concern is the possibility for hackers to retrieve bids or tenders before these are made public.
The police have for a long time been apprehensive of the fact that law firms do not protect themselves enough against computer hackers. Yet, since 2011, the American FBI has been organising awareness sessions on computer security and industrial espionage. However, according to Mickael Stout, a consultant in computer security, “the hackers will not stop anytime soon, and it is obvious that companies will have to keep up with the latest technology to ward off all threats.”
It must be noted that this movement is in fact gaining more ground, instead of weakening. The emergence of “Hackivists” such as the Anonymous, with a political aim is to make public certain information, left a deep impression globally. It is therefore highly recommended to keep close track of developments in technology and to secure as much as possible all of the companies’ data.
Dreyfus is specialised in the protection of intellectual property online and can assist you in defining your strategiesand reinforcing the measures you plan to implement. Please contact us for further details.
On May 28, 2014, the Court of Appeal of Lyon found that the title “Val Thorens” is protected by copyright. Consequently, the registration and use of the domain names <val-thorens.net> and <val-thorens.org> amount to infringement.
M.V registered the domain names <val-thorens.net> and <val-thorens.org> in 1998 and 2000 respectively. He is a consultant in information technology, web hosting and the management of advertising spaces. Regarding the Tourism Board of Val Thorens, it registered the trademark “Val Thorens” in 2004.
The Court of Appeal firstly reiterated that “in the absence of any claims from the author(s), the use of a work by a legal person in its own name leads to the presumption, as far as third parties accused of infringement are concerned, that this person holds intangible property rights over the work, whether such work is collective or not.” As such, the Tourism Board has locus standi.
The term “Val Thorens” in this case relates to a title of works, brochures and websites, the originality of which is not at issue. According to the Court, the title is the result of a “creative process, bearing the mark of the author’s personality.” It is linked to toponyms, such as the valley of the Thorens stream, leading to the creation of a new term that refers to these works in a “specific, original and recognizable” way. Thus, the Court held that “Val Thorens” is protected by copyright.
While the Board adduces evidence that the website <val-thorens.com> has been used since April 1997, M.V does not provide any evidence showing that he registered or used the domain name <val-thorens.org> before 2000.
Finally, the Board uses the trademark Val Thorens for holiday accommodation services. According to the Court, M.V’s placing of real estate advertisements on the websites <val-thorens.org> and <val-thorens.net> constituted trademark infringement. Indeed, there is a risk of confusion in the mind of the consumer owing to the similarity of the services and products.
Reliance on the decision by the Court of Appeal of Lyon should be tempered. Indeed, case law on the protection of titles of works is strict and unpredictable. The courts carry out a strict assessment of a title’s originality (Court of Appeal of Paris, September 6, 2013, “Les amoureux de la Bastille”; CA Paris, group 5, chamber 2, June 19, 2009, “L’empreinte de l’ange”). This is why it is difficult to consider this decision as creating a precedent. In light of the unpredictable nature of case law in relation to copyright matters, the best option would be to rely on trademark law and therefore to register one’s trademark.
The European Court of Justice rendered a preliminary ruling on April 9, 2014 in favor of right-holders with regards to customs regulation (CE) No. 1383/2003 and particularly the implementation of customs seizures (C-583/12, Sintax Trading OÜ / Maksu-ja Tolliamet).
In the present case, the Estonian authorities refused to release bottles of mouthwash imported from the Ukraine on the grounds that they infringed a patent registered under the name of the company Acerra. The latter did not comply to “the procedure to determine whether an intellectual property right has been infringed under national law” (article 3 paragraph 1 of regulation (EC) No 1383/2003. However, the proceedings were initiated by the Estonian customs authorities alone.
Does it therefore mean that, under the customs regulation, customs authorities can proceed, on their own initiative, with a customs seizure without the intervention of right-holders?
The European Court of Justice replied in the affirmative. It specified that the regulation does not seek “only to protect private rights and interests but also to protect public interests.” Indeed, one of the goals of the regulation is to prevent the placing on the market of goods which deceive the consumers and endanger their health and safety. Therefore, customs authorities can act on their own initiative, without any intervention by right-holders, in relation to legal actions designed to establish the infringement of intellectual property rights.
Furthermore, Regulation (EC) No 1383/2003 was repealed and replaced by Regulation (EU) No 608/2013 of June 12, 2013 regarding customs enforcement of intellectual property rights. The Court’s ruling applies in relation to the new regulation.
This ruling of the Court in favor of the right-holders is greatly welcomed. In the event of an omission on their part, customs authorities can always proceed with a customs seizure to protect and defend their rights.
On February 28, 2014, the Federal Court of California ruled in favour of Instagram in a case between the social network and one of its users (Rodriguez v Instagram LLC, CGC 13-532875) who alleged breach of contract by the web-based photograph sharing platform as well as violation of California’s contract law.
After it was bought by Facebook, Instagram modified its terms of service. In compliance with the contractual notice period, Instagram announced the changes in December 2012 and the new terms of service came into effect on January 19, 2013. Three material changes were made to harmonize the terms of service of Instagram and Facebook:
Users are owners of the content posted and no longer simply right holders in the content.
Instagram asserted the right to use posted content under a transferable and sub-licensable license.
The terms of service now include a liability waiver.
To facilitate the adoption of these new terms, Instagram provided that continued use of the service after January 19, 2013 would mean implicit consent to its new terms. A user, who believed that these terms had been imposed upon her without her consent, brought the case before the courts.
The judge of the federal court of California ruled in favour of Instagram on all claims.
Firstly, the plaintiff had a full opportunity to read the new terms, which she did. She could have declined the new terms by no longer using Instagram services. Yet, she did continue to use the website.
The plaintiff also argued that filing a lawsuit demonstrated that she rejected the new terms. The courts did not follow this line of reasoning and held that there was “no basis to conclude that the filing of a complaint is sufficient to reject the new terms – most especially after Plaintiff continues to use and presumably benefit from the Instagram site”.
Thus the social network does not incur contractual liability based on the plaintiff’s alleged non-acceptance of the terms. The decision of the Federal Court of California was logical, since social networks as well as users need legal certainty.
Dreyfus law firm is specialised in dispute resolution on social networks. Please do not hesitate to contact us for more information.
On May 25, 2014, the American National Arbitration Forum (NAF) delivered its 44th URS (Uniform Rapid Suspension) decision, the first in respect of a domain name bearing the .sexy TLD.
The domain name concerned, <finn.sexy> is reserved by North Sound Names. Spearheaded by Frank Schilling, also the founder of Uniregistry, which, to date, is a registry comprising of 50 new gTLDs, North Sound Names is used to store domain names in the TLDs managed by Uniregistry before they are made available to the public. It is in this context that the disputed domain name was reserved on April 15, 2014.
The domain name resolves to a parking page offering the name for sale and containing links called “First Names”, “Selfies”, “Diet”, “Fitness”, “Social Networks”, “Dating” and “Modeling.” It is to be noted that these terms are clearly detached from the business activities of the complainant, Finn.no, the largest online market in Finland.
In support of its complaint, the complainant mentions its extensive use of the Norwegian trademark FINN. This allows the expert to find that the first condition of the URS procedure has been satisfied as the domain name is identical to the trademark. With regard to the legitimate interests or the rights of the registrant, the expert notes that the latter employs the term “finn” in its common usage, i.e. referring to Finnish people. According to the expert, the registrant in fact has a legitimate interest to use this name. On the issue of bad faith, neither the fact of the domain name in dispute being offered for sale nor the notification received by the registrant from the Trademark Clearinghouse (TMCH) convinced the expert. Logically thus, the complaint was dismissed.
The URS procedure is still at an early stage and it is difficult to foresee how the case law of the centres will develop. Yet, there have been many dismissals since most proceedings are primarily concerned with clear cases of trademark abuse. A more appropriate option therefore would have been to proceed on the grounds of the UDRP (Uniform Dispute Resolution Policy). Indeed, while the rules are similar, UDRP experts espouse a more flexible approach and it is usually easier to lend credence to one’s complaint. Without entertaining any preconceived opinions about the experts’ views, it seems that a transfer unto the applicant would have been warranted.
Dreyfus specializes in domain name dispute resolution and guides you in the defense of your rights on the Internet. Please do not hesitate to contact us for any queries.
Enacted in 1994, the “Toubon” Act is one of the most famous laws in France. It requires companies to translate in French their slogans, particulars or information displayed on all media meant for the public. The major exception to this rule is the right to a trademark, since trademarks in foreign language need not be translated.
The Toubon Act attracted the attention of the Office québécois de la langue française. Back in 2012, that office drafted a Charter for retailers to use the French language and launched a publicised campaign promoting the use of the French language on storefronts.
Akin to the Toubon Act, the Charter provides for a trademark exception. Yet the office opposes it. It is of the view that storefront signage are rather considered by the public to be business names rather than trademarks. According to the office, commercial signage should therefore be translated into French. There is thus a clear conflict between what the law says and the interpretation made by the Québécois office.
It is in this context that eight retailers lodged a case before the Québec Superior Court asking to rule on the interpretation of the Charter. The question posed to the Court was clear: either the sign is a recognised trademark within the meaning of the Canadian Trademarks Act and the exception should apply; or it is not and it should therefore be translated in French.
In a declaratory judgment of April 9, 2014, the judges of the Québec Superior Court opined that “a trademark forms part of a legal concept that is governed by its own rules and differs significantly from that of a trade name or business name”.
The judge therefore applied the law stricto sensu and held that trademarks displayed on storefronts needed not be translated.
It is a fact that Québec traditionally holds particular importance to the French language; however, this decision is important since it denotes that tradition must not override the law.
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Written by Dreyfus10/07/2014 
With the recent cyber spying scandals, Internet governance and the Internet Corporation for Assigned Names and Numbers’ (ICANN) role have been much debated.
