Dreyfus

Following a decision from the French Competition Authority sanctioning Pierre Fabre Dermo-Cosmétique on October 29, 2008, the later lodged an appeal. The Court of Appeal of Paris addressed a reference for a preliminary ruling to the ECJ to know whether a total and absolute prohibition on selling contract products on the Internet, imposed on selected distributors within the framework of a selective distribution network, constitutes an infringement of Competition law of the European Union. Pierre Fabre Dermo-cosmétique manufactures and markets cosmetics and personal care products. In the agreements with distributors, a clause required sales to be made exclusively in a physical space, in which a qualified pharmacist must be present.

On October 13, 2011, the ECJ (1) confirmed the French Competition Authority decision.

First of all, the ECJ stated that a clause in a selective distribution contract banning the distributors of the company Pierre Fabre Dermo-cosmétique from selling its products online amounts to a restriction on competition by object (2), unless that clause is objectively justified, in particularly regarding to the properties of the products at issue. From there, the ECJ held that the clause requiring sales of cosmetics and personal care products to be made in a physical space where a qualified pharmacist must be present is not objectively justified in the context of the sale of non-prescription medicines.

Then, such a ban may be the object of an exemption. As to whether a selective distribution contract may benefit from the vertical block exemption (3), the ECJ held that the provisions of the vertical block exemption could not apply to a selective distribution agreement which contained a clause prohibiting de facto the use of the internet as a method of marketing the contractual products. However, such contract may benefit from the individual exemption (article 101.3 of the TFEU) provided that the conditions of that provision are met. This element will be decided upon by referring French Court of Appeal. Its decision is expected in the course of the first semester of 2012.

(1) ECJ, 13 oct. 2011, aff. C 439/09, Pierre Fabre Dermo-Cosmétique c/ Président de l’Autorité de la concurrence e.a.
(2) Art 101 of the TFEU (Treaty of the Functioning of the EU of 1st December 2009
(3) Commission Regulation (EC) No 2790/1999 of 22 December 1999 on the application of Article 81(3) of the Treaty to categories of vertical agreements and concerted practices (OJ 1999 L 336, p.21).

Click here to download the pdf version of this document

Since October 24, 2011, OHIM offers a mediation service in parallel to proceedings of appeal before the Board of Appeal. Said procedure allows the parties to reach an amicable settlement and suspends the appeal proceedings.

Mediation talks will normally be held in Alicante and the service itself is offered free of charge. A one-off fee is charged in the event that the parties wish to hold the mediation talks in Brussels in order to cover the traveling expenses of the mediator.

Mediation provides a swift and less costly alternative to litigation. It aims at bringing the parties together and assisting them in finding common ground on which a potential settlement may be made. The subject-matter of the mediation may, however, go beyond the scope of OHIM appeal proceedings and embrace future and present commercial and economic interests of the parties.

A team of eight qualified mediators has been drawn from various parts of the Office. They are all very experienced staff of the Office who underwent special training with the Chartered Institute of Arbitrators (CIARB) in London. Their CVs are published on the OHIM website so that the parties can require the services of a mediator in particular.

The parties retain control over the way the procedure is handled and its outcome. If the mediation fails, the appeal proceedings will resume from the point reached prior to the mediation. The mediator will never be involved in the appeal proceedings and is bound to keep the substance of the mediation confidential. Further, no record or files pertaining to the mediation will be retained by OHIM.

Depending on the success of this new service, the Office could consider to widen its scope to other appropriate stages of inter partes disputes. To be continued!

Click here to download the pdf version of this document

The Electronic Communication French Minister of has just approved the new dispute resolution system developed by AFNIC. Its name is Syreli.

The new procedure will come into force as from November 21, 2011 for .fr and .re extensions. It will come into force as from December 6, 2011 for the other extensions managed by AFNIC.

The details of the procedure can be summarized as follows:
• The domain name must have been created or renewed after July 1, 2011;
• The decision is based solely on the documents and statements filed by both parties;
• The procedure lasts about 60 days;
• The decision is rendered by a 3 member panel;
• The decision can reject the complaint, cancel or transfer the domain name;
• The decision will be suspended if a judicial procedure is initiated 15 days as from the decision;
• The examination fee is €250 excl. VAT. It is paid by complainant.

Click here to download the pdf version of this document

On September 12, 2011, the Council of the European Union amended the Directive 2006/116/EC on the term of protection of copyright and certain related rights (Directive 2011/77/UE).

The term of protection for performers, producers of phonograms and broadcasting organizations will be 70 years. Said term is harmonized with the duration of copyright term protection for authors. However, we remind that copyright term protection for authors is 70 years after lifetime whereas copyright term protection for related rights is 70 years after the work is lawfully made available to the public.

Said extension of the term of protection appears as an award granted to performers. Indeed, life expectancy has increased and therefore they will be assured of a stable income for their performances during their entire lifetime.
The EU Member States shall transpose the Directive 2011/77/UE by November 1, 2013.

Click here to download the pdf version of this document

The new trademark law in Kosovo came into force on September 8, 2011. This law is part of a general change in the intellectual property system. In addition, the Law on Industrial Designs and the Law on Patents were also modified so as to harmonize them with the European legislation.

From now on, trademark rights are only acquired through registration, mere use is not enough anymore. Protection of a well-known trademark is also acquired via registration.

In addition, a third-party may present some observations within three months of the publication of the trademark application in the Official Gazette but they will not take part in the proceedings.

Click here to download the pdf version of this document

The .eco is one of hundreds of new top level domains (TLDs) set to be created soon. It is dedicated to companies, individuals and NGOs for their websites on ecologic issues or eco friendly products.

Since the ecologic mater is both sensitive and fashionable, it is not surprising for the .eco extension to be the subject of power struggle to control it.

The organization backed by the famous US Vice President Al Gore to control the .eco extension has decided to clear the way to its rival, another organization backed by the non-less famous Mikhail Gorbachev.

The Canadian company Big Room, supported by Mikhail Gorbachev’s charity Green Cross International, is therefore in good position to win the bid to act as the official registry of the .eco.

Nevertheless, it is important to note that the real challenge for any bidder will be to satisfy all the ICANN criteria…

Click here to download the pdf version of this document

Defective hardware may lead to a whole new category of typo-squatting.

Indeed, where incidents of typo-squatting usually arise due to a misspelling of a domain name by the Internet user himself, hardware malfunction may cause a false transcription of the domain name being typed.

When they are exposed to heat or radiation, memory chips and Central Processing Units caches can generate “flipped bits”, where a 1 turns into a 0 or vice-versa. Since each letter of a domain name is encoded with a binary code from 0000000 to 1111111, a single flipped bit can turn one letter into another and direct the Internet user towards a different domain.

Whilst acknowledging that not all of them could impact a DNS request, it seems that 614,000 memory errors occur per hour globally. Even though such malfunctions should statistically only be a concern for very high-traffic domains, and only if the bit malfunction is quite widespread, there is still a significant chance of problems occurring.

Indeed, bit squatting could be criminally profitable if it were to target popular domains, especially domain names for content delivery networks such as domains providing updates or antivirus protection. Furthermore, for trademark owners particularly at risk of typo-squatting, it is advisable to conduct a review of their trademark’s enforcement strategy.

To this end, trademark owners could proactively register domains that could be bit-squatted, just as some already do to prevent classical incidents of typo-squatting. Only, instead of looking for common misspellings of their name or brand, companies willing to address this problem should be provided with thorough expertise on widespread bit malfunctions.

Click here to download the pdf version of this document

Since the end of 2010, the U.S. authorities launched a round of domain seizures. It is within the framework of this struggle against online infringement that, in February 2011, domain names in “.com” and “.org” of the website Rojadirecta, which displays links to replays of sports events, were seized by the American Government.

The company which owns these contended domains, Puerto 80, filed a petition in the Southern district of New York on the grounds of freedom of speech. on April 4, 2011, the United States District Court judge decided to deny the request arguing that the contents toward which those links were directed were copyrighted.
Furthermore, the owner of these domains was able to carry on its online services by registering domains under country code top-level domains << .es >> (Spain), << .me >> (Montenegro) and << .in >> (India).

According to the judgment which was upheld by the Second Circuit Appeals Court on September 16 2011, the U.S. Government is entitled to seize a domain on the sole assumption of infringement of copyright. By doing so the courts have also widened the scope of power of the American Government which, until then, had only seized sites offering illegal material.

Indeed, the fact of providing users with links leading to protected contents can be just as harmful for copyright owners. If the method agreed by the American judges is disputable, the liability of the host of the links could also have been established on the grounds of the “Online Copyright Infringement Liability Limitation Act.” Although it might be arduous to prove, one could argue that the fact of providing links, with the knowledge that those links lead directly to illicit contents, should nullify the benefits of the liability limitation of the online service provider (safe harbor).

Click here to download the pdf version of this document

Following a relatively quiet summer season, ICANN just published a modified version of the gTLD Applicant Guidebook on September 19, 2011.

Dreyfus & associes was present at the Parisian global awareness meeting dedicated to new gTLDs organized by ICANN.

This new guide is indented to specify various points decided during the Singapore meeting dated June 20, 2011 and more particularly confirms that applications for new gTLDs are planned to be accepted from January 12 to March 29, 2012. Application will have to be completed and the tax procedure paid by April 12, 2012 at midnight.

New list of prohibited terms

The modified version of the guide adds new terms to the list of prohibited terms that won’t be available for application, in particular those of the International Olympic Committee and the International Red Cross, as listed below:

International Olympic Committee
OLYMPIC OLYMPIAD OLYMPIQUE
OLYMPIADE OLYMPISCH OLÍMPICO
أوﻟﻴﻤﺒﻴﺎد أوﻟﻴﻤﺒﻲ OLIMPÍADA
奥林匹克 奥林匹亚 奧林匹克
奧林匹亞 Ολυμπιακοί Ολυμπιάδα
올림픽 올림피아드 Олимпийский
Олимпиада

International Red Cross and Red Crescent Movement 1B
REDCROSS REDCRESCENT REDCRYSTAL
REDLIONANDSUN MAGENDDAVIDADOM REDSTAROFDAVID
CROIXROUGE CROIX-ROUGE CROISSANTROUGE
CROISSANT-ROUGE CRISTALROUGE CRISTAL-ROUGE
CRUZROJA MEDIALUNAROJA מגן דוד אדום
CRISTALROJO Красный Крест Красный Полумесяц
لالهلا رمحألا رمحألا بيلصلا Красный Кристалл
紅十字 اﻟﻛرﻳﺳﺗﺎﻟﺔ اﻟﺣﻣراء ءارمحلا ةرولبلا
红十字 紅新月 红新月
紅水晶 红水晶

Enlarged list of reserved country names

In addition to the country names defined in the ISO 3166-1 list, other variations have been included in the applicant guidebook essentially to cover territory names included in the corresponding two-character ISO code. For instance, the .gp code corresponding to Guadeloupe also applies to La Désirade, Marie-Galante and Les Saintes whose names will not be available for applicants.

It is worthwhile to note that .us corresponding to the United-States will also cover the name “America”.

Background screening on the candidates

This new application guide also contains information on the background screening on the candidates and the corresponding time frame (10 years). ICANN is in discussions with INTERPOL to identify ways in which both organizations can collaborate in background screenings on candidates and on potential supplemental investigations.

GAC warning

The new application guide specifies the content of the advices and warnings emitted by the GAC (Government Advisory Committee) in relation to some applications. ICANN also specifies how these advices and warnings should be or not taken into account.

No developments on rights protection mechanisms

The new guide does not contain any information on right protection mechanisms. Neither the Trademark Clearing House mechanisms have been specified, nor the organization that will be in charge of its management.

The new gTLD program is now fully launched and it will be possible for the first candidates to file their application in about 100 days. ICANN expects to receive several hundred applications, which will undoubtedly change the Internet landscape.

Click here to download the pdf version of this document

Although three-dimensional trademarks are registrable in China, the recent case Nestlé SA vs. Master Sauce CO. Ltd suggests that enforcement of trademark rights might not always be ensured.

The case involved the shape of a brown, square-based bottle sauce which was designed by Julius Maggi in 1886 and is now used by Nestlé for its products. In 1995, Nestlé obtained registration of a three dimensional trademark in various countries but it was rejected by the Chinese Trademark Office.

Nestlé filed a review in 2007 and the Trademark Review and Adjudication Board ruled that although this three dimensional sign would normally be regarded as a product container and could not itself indicate the origin of the products, Nestlé had submitted enough evidence of use during the review procedure to prove that the trademark had obtained distinctiveness through use and could be approved for registration.

After receiving a cease-and-desist letter by Nestlé, Master sauce Co Ltd, which had been using a square-based bottle since 1983 for various products, took the initiative to file an action for a declaration of non-infringement with the Intermediate People’s Court of Jiangmen City and an application with the Trademark Review Adjudication Board to cancel Nestlé’s trademark.

To date, administrative proceedings are still pending but the courts have issued decisions against Nestlé. On July 2010, the Jiangmen Court found that Nestlé’s mark was weakly distinctive and its use by another party, in conjunction with another trademark, did not constitute infringement.
In November 2010, Nestlé appealed unsuccessfully to the Guangdong Higher people’s Court. Indeed, the Court found the trademark was used as a container by other manufacturers than Nestlé, before the registration of its trademark and concluded the shape of the bottle was not distinctive enough. The Court also noted that Master Sauce did not use the bottle as a trademark and thus did not act in bad faith.

That is to say the Court considered that, however well-known a trademark is outside China, its distinctive character cannot be recognized if the mark is famous in China.

Click here to download the pdf version of this document