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Subtitled: Law and, or, versus the Marketers: Evidence in the Cadburys v Darrell Lea case

I’ve been hearing rumours for some time now about evidence issues/problems/disasters in the recently concluded hearing in the case of Cadburys versus Darrell Lea, before Justice Heerey down here in the Vic Federal Court. So imagine my excitement when I realised there were no less than three decisions up on AustLII. They’re really interesting decisions because they say a lot about how law interacts with marketing people, marketing experts in these cases that are all about how consumers behave. Yes, I am a sad IP law geek. Never mind, I’ve come to terms with that. The decisions are:

• Cadbury Schweppes Pty Ltd v Darrell Lea Chocolate Shops Pty Ltd [2006] FCA 363 (which I’ll call the Cadburys Expert Decision). In this decision, Justice Heerey ruled that a whole bunch of expert evidence from a marketing expert was inadmissible;
• Cadbury Schweppes Pty Ltd v Darrell Lea Chocolate Shops Pty Ltd [2006] FCA 364 (I’ll call this one the Cadburys Survey Decision). In this decision, Justice Heerey ruled some survey-style evidence was admissible; and
• Cadbury Schweppes Pty Ltd v Darrell Lea Chocolate Shops Pty Ltd [2006] FCA 386 (the Cadburys Hearsay decision). In this case, Heerey J ruled that some reports that included statements from consumers about how they reacted to purple weren’t admissible to prove the truth of those statements.

I was fascinated, partly because the Judge has chosen to exclude a whole lot of stuff (which must annoy the Cadburys lawyers), and partly because I’m currently teaching Trade Mark Law to undergraduate students. Of course, one thing you spend time talking about in such a course is matters of proof. Since I’ve had to dissect the reasoning for my students, I want to spend a little time in this post putting my thoughts out there. Comments welcome of course! (more…)

Yes, all the copyright experts I know were predicting this result: London’s High Court has ruled that Da Vinci Code author Dan Brown did not infringe the copyright of an earlier book, The Holy Blood and the Holy Grail. The decision seems to affirm a basic fact: copyright does not protect ideas or facts, and an author can draw on ideas, facts, and even fictitious histories in writing new work. A good, if obvious result, it seems to me. And now the pliaintiffs end up with a very nasty costs bill: 85 per cent of Random House’s legal costs, which could top 1 million pounds ($A2.4 million).

The judge clearly did not believe the plaintiffs. According to The Age,

In the end,

• BBC story here
• The Age story here
• The decision has now been published, here

The New York Times has a short and sharp editorial criticising the US patent system. It’s at a very high level of generality, but it does cover some of the familiar themes for criticism: (more…)

A little while ago I blogged about a case – and more particularly an argument – that is currently before the Copyright Tribunal. The case concerns the fees schools should pay for digital uses of copyright material; the argument concerns whether ‘telling students to view’ a website should ever be a remunerable act. Reports of the case had elicited a fair bit of commentary overseas. My own post elicited quite a lot of email.

The case itself has gone ‘underground’ a little – no new developments to be reported at this stage. But I did want to note a letter to The Australian newspaper, written by CAL CEO Michael Fraser about the case. I can’t find the letter online, so I’ll quote some of the key parts: (more…)

Coverage today of a judgment, handed down yesterday, in the Kazaa proceedings. For those who joined us late (are there any of you?), Kazaa (P2P Software provider) has been sued for authorising infringement of copyright by users of the P2P file-sharing software. Justice Wilcox handed down judgment last year, holding they were liable for authorisation, and an appeal from that judgment was heard in early February. Judgment in the appeal is reserved. In the meantime, however, there’s proceedings going on for contempt, because the trial judge did not stay his injunction pending the appeal. That is, Kazaa was ordered, in the meantime, to take steps to stop authorising infringement. And there’s a live question as to whether they’ve done enough. The judgment raises some really interesting questions about contempt. More, much more, over the fold. (more…)

The Sydney Morning Herald is carrying a story entitled “The fine art of patent trolling”, which focusses on Forgent Networks Inc. Forgent is perhaps best known for its 2004 litigation against 31 companies, including Apple, Microsoft and Adobe, alleging infringement of a patent covering the jpeg image compression algorithm. That suit is still pending, but has so far netted a significant sum in settlement payments from some of the respondents. (more…)

Labor MP Bob McMullan is intending to introduce a private members bill when Parliament next sits (on 27 March) that would give artists royalties on the resale of their creations. (more…)

Michael Geist has a great post analysing a study just released by the CRIA. He concludes that the study contradicts a number of the usual claims made by the CRIA, with perhaps the two most interesting points being:

“even among those who download music from P2P services, the music acquired on those services account for only one-third of the music on their computers as store-bought CDs remain the single largest source of music for downloaders”

and

“consistent with many other studies, people who download music from P2P services frequently buy that same music. The study found that only 25% of respondents said they never bought music after listening to it as a P2P downloaded track. That obviously leaves nearly 75% as future purchasers, including 21% who have bought music ten times or more.”

So while there is definitely music piracy out there, is it as bad as has been stated?

(The appendix containing the data analysed is available here).

From GrokLaw, the District Court of Amsterdam has upheld the validity of the Creative Commons Attribution-Noncommercial-Sharealike license. Adam Curry, a well-known media figure now living in Holland, posted some pictures of his family on photo-sharing site Flickr (his profile appears to be here). The photos carried a notice saying “This photo is public”, and were published under a non-commercial Creative Commons licence. A Dutch magazine reprinted four of the photos in a story on Curry and his children. (more…)

Something I should have noted last week: the Adelphi Charter was launched in Australia, at an event organised by AEShareNet. To quote from the Charter website:

The Charter, which was formally launched worldwide in October 2005, is really a simple bunch of principles, that sound a lot like common sense – unless you’ve been in the IP debate for a while, in which case it sounds like a foreign language, so far is it from the ordinary parlance. In a way, the Charter advocates a return to simple, important principles in an area that far too often descends immediately to an unhealthy level of detail and qualification. You can see a ‘January 2006’ report here. (more…)

In a significant shift from its jurisprudence of the past forty years, the United States Supreme Court has rejected the presumption that a patent confers market power on the holder of that patent. In Illinois Tool Works Inc. v Independent Ink, Inc. (No. 04-1329, decided 1 March 2006), the Supreme Court concluded that since a patent does not necessarily confer market power, defendants in cases involving a tying arrangement must prove the existence of market power to bring an antitrust claim.

A possible implication of this case is that companies might be able to require customers to use the spare parts and supplies (car parts, toner cartridges etc.), designed and sold for use with their proprietary equipment, and prohibit the manufacture and sale of spare parts and supplies by third parties. (more…)

The Internet and blogosphere have been rife, just recently, with a story that first emerged in The Australian. The story went under the headline: ‘Copyright makes web a turn-off’, and came with this as the rather glorious (and alarmist!) first paragraph:

‘Schools have warned they will have to turn off the internet if a move by the nation’s copyright collection society forces them to pay a fee every time a teacher instructs students to browse a website’

What on earth could be going on? Well, I admit it, I’ve been hearing about this for some time, and I really should have blogged it before now. But following comments (and ‘please explains’) from both Michael Geist, and Michael Madison, some commentary on Boing Boing, and by Warwick Rothnie, and the emergence of the story on the Linux Australia listservs, it’s definitely time to weigh in.

Is such a radical argument being made? Oh, yes. The Copyright Agency Limited (CAL), an Australian collecting society isn’t demanding that schools ‘turn off the internet’. But they ARE demanding that schools pay when students are told to look at stuff. claiming that when students are told to look at sites online, that is a remunerable activity, and hence something that should be included in calculating rates that schools pay under the statutory license. The argument is a step in the more immediate question, which relates to what questions are to be put on an electronic use survey. [updated to clarify – Monday, 6 March 2006, 5:30pm]. (more…)

I blogged briefly yesterday about the release of the TPM Inquiry Report; it’s been attracting some international interest, and you can see my previous post for links to that commentary.

I’m still trying to digest the effect of the report. But the AFR has a story today (sorry, subscription only) noting that the report may well lead to conflict with the US. And here’s the kicker: our Trade Minister is apparently meeting US trade officials in Washington DC next week to review the first 15 months of the FTA.

What’s the bet he gets a bit of a pounding on the Report? But what to do? The dictates of Australian politics, and international realpolitik may be in conflict here. (more…)

Well, it’s out. Yesterday, the House of Reps Standing Committee on Legal and Constitutional Affairs released its report on the Review of Technological Protection Measures Exceptions. This is the committee set up to examine what exceptions should be created, as Australia implements Article 17.4.7 of the AUSFTA, which requires Australia to implement stronger anti-circumvention laws, more akin to the US DMCA.

And what a report it is. It has a list of 37 recommendations, many of which are concerned with protecting user interests. More over the fold. (more…)

Let me say that again, counterfeiting is a serious problem. The OECD think so, the Australian government think so – plenty of people think so. I think so. Counterfeiting, at least as it occurs within Australia, has no social value that I’m aware of, and has costs including (a) losses to the trade mark owner (lost sales), (b) the costs entailed by the deception of consumers, (c) indirect losses to the trade mark owner (for example, loss of reputation for quality, loss of ‘prestige’ value), (d) the costs of enforcement incurred by trade mark owners and governments alike, and (e) the ‘social losses’ – lost jobs, lost tax revenue, and lost investment in research and development that may arise as a result of the lost revenue.

I have a great deal of sympathy for trade mark owners who reach levels of desperation, and use hardball tactics, against counterfeiters, particularly ‘repeat offenders’. It must be incredibly frustrating dealing with parties that have little or no respect for the law or the orders of the court. It is clear, from various judgments by the Federal Court judges, that they too have little sympathy, in general, with counterfeiters and importers/sellers of counterfeit goods.

In this context, however, this judgment is a timely reminder to lawyers that they cannot play too hardball in dealing with counterfeiters, particularly counterfeiters who are unrepresented by lawyers themselves – even where the counterfeiter has displayed contempt for the orders of the court. (more…)