ILN IP Insider - International Lawyers Network

2023: The Year of the Burgers

From the Big Mac v Big Jack to the KFC v HFC – 2023 was the year of the burger. In Australia, the burger debate was first brought to our attention in 2020 following a marketing campaign by Hungry Jack’s Pty Ltd (Hungry Jack’s) for its limited-edition Big Jack burger. Hungry Jack’s (better known as Burger King in some countries) and McD Asia Pacific LLC (McDonald’s) are both global fast food chains known for their burger and fry combination.

It was following the decision of the Big Mac v Big Jack that we then saw the lesser-known battle initiated by KFC THC V Ltd (KFC) in relation to an application by Grill’d IP Pty Ltd (Grill’d) to register ”HFC” as a trade mark in respect of the healthier chicken options available on its menu.

McD Asia Pacific LLC v Hungry Jack’s Pty Ltd [2023] FCA 1412

Background

McDonald’s initially argued that, amongst other things, the “BIG JACK” and “MEGA JACK” trade marks owned by Hungry Jack’s should be cancelled on the basis that they were deceptively similar to the well-known McDonald’s “BIG MAC”. It was also alleged that the marks had been used in bad faith by taking advantage of the similarities between the two burgers and essentially selling a ‘copycat’ of the McDonald’s burger.

In response, Hungry Jack’s argued that it had no intention of selling a ‘copycat’ of the McDonald’s burger and their only intention for the new name was for consumers to compare their products, relying on ‘cheekiness’ being part of the Hungry Jack’s brand.

The decision

Justice Burley of the Federal Court ultimately found that there was no trade mark infringement in Hungry Jack’s use of the “BIG JACK” and “MEGA JACK” marks and that they were not deceptively similar to McDonald’s “BIG MAC”. The decision was based on the comparison of the words MAC and JACK, which were found to be phonetically and semantically different and therefore unlikely to be confused by a consumer – similar to how one person might recall the name of another person without confusion.

Further, considering the information before the Court, Justice Burley agreed with Hungry Jack’s in that ‘cheekiness’ was part of its brand and that they had no intention to confuse consumers. Accordingly, the decision was made that the “BIG JACK” and “MEGA JACK” marks were valid and would remain on the trade mark Register.

KFC THC V Ltd v Grill’d IP Pty Ltd [2023] ATMO 192

Background

KFC, being the global fast food chain well known for its ‘finger-lickin’ good’ fried chicken and secret herbs and spices, launched its opposition against Grill’d – an Australian-owned restaurant chain that markets itself as a healthier and fresher alternative to the other major fast food chains – for the introduction of its “HFC” burger.

In its opposition to the registration of the Grill’d mark, KFC argued that the “HFC” mark was:

substantially identical to or deceptively similar to the “KFC” mark, which had acquired a reputation in Australia;
likely to deceive or cause confusion; and
made in bad faith.

Grill’d however disagreed with this argument, submitting that the marks were distinguishable because they are both used as initialisms and not acronyms – meaning that that each letter is pronounced individually. This argument meant that the only commonality of the marks is the use of the letters ”FC”, which are descriptive of “fried chicken”. Grill’d further argued that it is unlikely for there to be confusion between the two marks as the concept of the products is different, noting that the letter “H” refers to “Healthy”, and K refers to ”Kentucky”.

The decision

Whilst the Hearing Officer did not agree that in the context of the use of each mark, the ‘FC’ lettering was an obvious reference to ‘fried chicken’ , they did rely on the precedent set by Australian Meat Group Pty Ltd v JBS Australia Pty Ltd [2018] FCAFC 207, whereby the Court determined that ‘consumers are conditioned to the use of acronyms and as such, are used to rely on small differences to distinguish between acronyms without being confused or misled by them’ and therefore concluded that the “HFC” mark was neither substantially identical nor deceptively similar to the “KFC” mark.

Importantly, the Hearing Officer emphasised the scope afforded by trade marks containing acronyms, and unless bad faith can be demonstrated, closer than normal similarities (such as one-letter differences), are expected and tolerated.

Key takeaway

Whether it’s cheekiness or comparative advertising driving your business’ marketing strategy, the outcome of these cases serve as a timely reminder to ensure your business has sought the proper advice before rolling out any ‘risky marketing’ ideas to lower the risk of potential trade mark infringement

The Good Get: Interviews, The Predicates Of Copyright Ownership, & Divorcing Subjects From Owning Copyright Content

“Headlines” and “titles” are related, sometimes interchangeable, items appearing atop news stories. But, in this space, headlines are usually a source of inspiration (so we can write about intellectual property issues that may interest more than just IP attorneys), and titles a bit of fun (so we can draw in those looking for a bit of lightness amid more serious legal analysis).

Today is no different, as the headlines are “Trump sues Bob Woodward for releasing audio of their interviews without permission” and “Bob Woodward seeks to end Donald Trump’s lawsuit over audiobook,” each of which inspires the question of why interview subjects, the real draw (or the “get” as it were), do not have clearly delineated intellectual property rights in the publishable interview. The titling fun comes from understanding that the language of the “good get” has, “[m]ost recently, …come to mean ‘the acquisition of an endorsement’ or ‘the act of securing an engagement for an appearance (as for a speech or interview),” but that word “get” can also signify divorce for some. That then plays off the rest of the title’s allusions to separating “subjects” from the “predicates” of copyright ownership, themselves words connoting the foundational elements of both “any complete sentence” and at times a court’s jurisdiction over infringement matters. They say that good writing, like good magic, loses its mystery if explained. But, if the Greatest felt honesty demanded explanations sometimes, who am I to quibble with such a fine philosophy (or imply by withholding explanation that my writing is good)? But enough on this title…

…and back to these headlines.

On December 6, 2023, Bob Woodward and other defendants moved to dismiss claims brought against them by former President Donald J. Trump Woodward’s publication, The Trump Tapes: Bob Woodward’s Twenty Interviews with President Donald Trump, an audio-book also released in print. The nine-count complaint originally filed on Monday, January 30, 2023, by the United States District Court for the Northern District of Florida, had asserted myriad legal claims, and sought various relief, all around a central assertion that Woodward had released without the consent audio recordings of numerous interviews that Woodward conducted of former President Trump. The complaint had “accuse[d] Woodward of the ‘systematic usurpation, manipulation, and exploitation of audio’ in violation of Trump’s contractual rights and copyright interests,” according to NPR. Trump twice amended the complaint, and the Florida court transferred the case to the Southern District of New York. Before the second amendment, President Trump received a copyright registration covering the work, despite an early registration being recorded in Woodward’s favor. The moving, response, and reply papers were all filed in the same December 6-7, 2023 time frame by lawyers for Woodward and the former President, respectively.

What did those papers say?

The motion to dismiss, as linked by Law 360 [subscription may be necessary; also available through PACER at Docket #73 in matter 23-cv-06883-PGG] asserted that the “government works” or “government edicts” doctrine barred the copyright claims, that President Trump did not meet the definition of “joint author” or of the whole “author” of the responses to the interviewer’s questions, and that state law contract or tort claims were pre-empted or baseless.

The opposition, as also linked by Law 360 [subscription may be necessary; also available through PACER at Docket #77] argued that the government works doctrine did not apply because the interviews were not presidential duties nor were the interview recordings presidential records, that President Trump was the dominant author of the responsive elements of the interview, and that the state claims were well-pled and not preempted.

The Woodward reply focused on certain harmful admissions in earlier Trump court submissions that could spell trouble for the former President’s claims. [The reply brief is available through PACER as Dkt. #75]

Even before these motion papers were filed, legal experts found the claims both flawed and intriguing, and we do too.

So, question one is whether the “government works” doctrine applies. To answer that, it might be helpful to know what the doctrine is and where it comes from. As found in the Woodward Motion Brief:

“[C]opyright protection…is not available for any work of the United States Government,” which is defined as any “work prepared by [1] an officer or employee of the United States Government [2] as part of that person’s official duties.” 17 U.S.C. §§101, 105. “The basic premise of [S]ection 105…[is] that works produced for the U.S. Government by its officers and employees should not be subject to copyright” and fall “in the public domain.” H.R. Rep. No. 94-1476 at 58 (1976); see also Georgia v. Public.Resource.Org, 140 S. Ct. 1498, 1509-10 (2020). The government works principle is central to our democracy: the work product of government representatives—including the president—is common property that exists to benefit the public, not an opportunity for exclusive, private gain. President Trump’s claims run head-on into this doctrine.

[Woodward Motion Brief at 10].

While the former President’s lawyers responded by emphasizing that the interviews were not part of government works because they were not part of Mr. Trump’s official duties (or that questions of fact existed that made deciding that question at this stage of the litigation inappropriate), their most pointed assertion might be the contradiction between Woodward’s assertions and his conclusions: “Woodward argues the Work, including the Interviews, are a work of government copyright, and belongs to the ‘People’ and the ‘public domain’ but he has unabashedly asserted sole copyright to the Work and asserted his own copyright.” Trump Responding Brief at 5.

Though Woodward’s motion brief makes a fairly compelling argument that interviews are a necessary party of the duties of a President as a politician wishing to retain office or further a governing agenda, it is less convincing an argument that it is a necessary duty of President as an officeholder, where the only stated obligation related to keeping the American people informed of the President’s views is an indirect one, namely to, “from time to time[,] give to the Congress Information of the State of the Union, and recommend to their Consideration such Measures as he shall judge necessary and expedient.” US Const., Art. II, Section 3. Though some questions of fact surrounding the Trump/Woodward conversations may have seemed to exist as to whether such interviews were or were not within the duties of the president’s office, it is arguable that:

Plaintiff [Trump]’s own words defeat any argument to the contrary: “more than any other public official, the President is expected to respond to questions from the media that affect his ability to maintain the trust of the American people and effectively carry out his official duties…. [S]peaking to the press and communicating with the public is clearly conduct ‘of the kind [a President] is employed to perform.’” Dkt. 73 (“MTD”), [and Dkt. 74-5,] Ex. D, 8, 19…As the D.C. Circuit recently recognized, and President Trump previously confirmed, the ”bully pulpit” is “an everyday tool of the presidency.”

[Woodward Reply Brief at 1, 3 (quoting brief the former President had filed in case with E. Jean Carroll, wherein his counsel asserted the quoted statement on his behalf)].

Still, it seems strange that Woodward, a reporter, would argue that the interviews are somehow government works. It is strange because that would mean that the unpublished portions would also be government works available for public use. It would also seem that that designation would prohibit Woodward from private ownership of the copyright in the full work, a concept that Woodward would surely resist and with which his own copyright registrations are inconsistent.

Interestingly, as an aside (since this is an International Lawyers Network IP Group Publication that “brings together IP practitioners from around the world to share their experience and expertise on the latest trends in intellectual property law”), the government works doctrine is an American approach very different than that taken in other countries in the English common law tradition that “provide[] Crown copyright protection for government works,” Heiko Richter notes (at page 7) in the 2021 article “Copyright Protection of Government-Related Material Before The Courts of the United States and Canada: Considerations of Further Reforms.” Since the first statutory Crown copyright provision in section 18 of the UK Copyright Act of 1911, the scope of the right has been further refined to assure copyright protection to “works ‘by an officer or servant of the Crown in the course of his duties.’” Id. at 19. Thus, in language very similar to that precluding copyright in the United States, the British recognize it. But the debate continues. As Richter further observes, Canada’s acceptance of Crown copyright as a bulwark of “ensuring accuracy and integrity of government documents” should not drive the law to allow “’such an expansive Crown copyright regime that public interest in accessing information is harmed’” because that “would risk ‘impeding the public interest in accessing these works and could compromise the existence of a robust public domain.’” Id. at 23 (quoting the Supreme Court of Canada opinion Keatley v. Teranet, 43 SCC, para. 54 (2019), also concurring opinion, para. 97). Other commentators, such as Vishal Rakheccha, have also sought to reimagine how copyright in Crown copyright jurisdictions might strike the best balance of access, accuracy, and enforcement around government works copyrights in British common law jurisdictions like India.

But, regardless of such international considerations and whether or not interviews were within the scope of presidential duties, the interviews as published may not qualify as such works because they were not “prepared” in the copyright sense by Donald Trump as President, who did not himself fix them in a tangible means of expression. The reporter here, Bob Woodward, argues that he did that by choosing the questions and controlling the recording device. Woodward Motion Brief at 18-23. Woodward’s reply brief also pushes back strongly against the former president’s reliance on the Copyright Office’s Compendium, which says that “the US Copyright Office will assume that the interviewer and the interviewee own the copyright in their respective questions and responses…,” subject to certain exceptions. Woodward Reply Brief at 4ff. With supportive citations, Woodward argues that the Compendium is not a deference-drawing policy articulation, and that copyright office processes are not adjudications with either binding effect or persuasive value. Id.

While that Compendium is not the sort of administrative guidance to which substantial deference is given, it does reflect some Copyright Office thinking potentially troublesome to the Woodward position. Other recent Copyright Office guidance also seems inconsistent with Woodward’s take. For example, the Copyright Office recently said that a human being’s questions, or prompts, from which another intelligence (i.e. an artificial one) creates a work are insufficient to accord the human prompter the status of author: “when an AI technology receives solely a prompt from a human and produces complex written, visual, or musical works in response, the ‘traditional elements of authorship’ are determined and executed by the technology—not the human user,” as noted (at page 7) in the March 16, 2023 Copyright Registration Guidance: Works Containing Material Generated by Artificial Intelligence. When a Woodward question prompts a Trump response, it is just that, a response created by Trump, not Woodward, and Woodward does not exercise control over how Trump interprets the questions and forms the answers. When the Copyright Office goes on to note that AI “users do not exercise ultimate creative control over how such systems interpret prompts and generate material” in response (Id.), it expresses a sentiment that sounds a lot like what Bob Woodward said to NPR’s Steve Inskeep about how Donald Trump responds to the prompts of a democratic society or Woodward’s questions concerning such matters: “’It’s so off the tracks, you don’t know what to do with it,’ Woodward says to Inskeep. ‘It’s almost unexplainable. So what do you do as a reporter? You just put it all out there and let the people decide.’” See also NPR Author Interviews, Bob Woodward’s new audiobook features hours of his interviews with ex-President Trump, October 24, 2022. There would seem to be an analogy (unhelpful to Woodward) there to those who take AI-generated content and just put it all out there after tiring of further prompting or growing frustrated with the lack of shaping impact of such prompts on the other’s outputs.

Moreover, the copyright in an extemporaneous original performance, prompted or not, generally resides in the artist, and not the sound engineer or videographer, as Nickey Frankel has noted in writing about copyright in performance or performing arts. And interviews involving Donald Trump have long been likened to performance art, even in periods before his presidency. In the UK, and elsewhere for instance, “[s]ome argue that [such control over one’s own performances] also includes improvisation, so you might even have a performance right if you are filmed having a tantrum in public. And it doesn’t have to be a paid performance to qualify,” as Dr Hayleigh Bosher, Senior Lecturer in Intellectual Property Law at Brunel University London, notes. Similar suggestions have arisen here in the United States, with one commentator suggesting that “copyright’s authorship-as-fixation regime rests on a faulty premise, betrays copyright law’s role in recognizing and rewarding creativity and denies copyright interests to the very individuals who have provided significant, if not the most important, original contributions to works within copyright’s traditional subject matter,” and therefore that commentator “calls for a fundamental reconsideration of the concept of authorship, including the issue of performer copyrights, in order to better align copyright law with its utilitarian goals, the realities of the creative process and broader public policy.” Thus, there are some copyright arguments or policies in play beyond those most immediately considered in the motion papers.

Arguing in part against any future performer-based claim implied in the Trump position, Woodward argues that the interviewee here has no claim to joint authorship since Woodward, as the dominant author, showed no intent to share authorship and therefore there was not the necessary mutual intent. Woodward Motion Brief at 16; Woodward Reply Brief at 7. But, while perhaps ultimately unpersuasive at any trial stage, at the present stage of proceedings it seems the book jacket and write-up as to the print edition at the Simon & Schuster website, viewed in the light most favorable to the non-moving party, could find arguable indicia of such intent in the book (i) being titled The Trump Tapes, (ii) in the reference to “Twenty Interviews with President Donald Trump,” rather than “of” him, (iii) in referencing the inclusion of “all 27 letters between President Trump and North Korean Leader Kim Jong Un,” which Woodward certainly could not be claiming to hold any copyright over, and (iv) in noting that it is the “inside story of Trump’s performance as president—in his own words,” albeit “as he is questioned.” Id. (italics added for emphasis in items (i)-(iii)). Those snippets seem arguably suggestive of an intent to use the former President’s input generously, perhaps more generously than fair use might otherwise allow, and in a manner often unvarnished or unprocessed to the point of being an author’s, or an author-like, contribution. Indeed, that transparency is part of what Woodward intended, and what the book is being sold on. See book’s Simon & Schuster webpage (noting the book is “Read by Donald J. Trump and Bob Woodward,” but startingly linking to another Simon & Schuster page concerning Donald Trump entitled “Donald J. Trump…About The Author” and including “Books by Donald J. Trump,” including–if you can believe it–The Trump Tapes!!!)(emphasis added, including the exclamation points, which I rarely use). There would seem here questions of both law and fact that might have been more directly inserted into the pleadings or motion papers as they complicate the more clearly segmented perspectives on which the Woodward arguments best rest.

The Woodward position gets stronger, however, when one looks to the final published product, whether one engages the audio version by listening or the print version by reading. There, one sees the editing, sequencing, and timing decisions consistent with authorship in Woodward rather than Trump. The Woodward Reply Brief also makes good use of the former president’s various statements disclaiming any intent to create a joint work, and the case law supporting the “dominant author” concept. Woodward Reply at 7-10.

There is also something common-sensical about the notion that presidents should not own their interviews, as that seems structurally inconsistent with the ways in which separation of powers, the First Amendment, the copyright clause, and the emoluments clause must intersect. But even that common-sense instinct gets tempered by Woodward’s agreement that the tapes “would not be used in contemporaneous news articles” (Woodward Brief at 6-7) in any manner. Does that limit Woodward’s First Amendment, freedom of the press arguments? Probably not, as speech and press rights are not for newspapers alone, and what, when, and how to publish or whether to publish at all have always been parts of our First Amendment protections. But those big questions are better suited for a constitutional law blog than this IP one. Thus, I mention them in passing in case others wish to explore them. I also mention them if, despite every possible IP argument or effort here to Monday morning quarterback possible claims or questions of fact like a good blogger should (rather than out of any real commitment to either side), someone else wants to decide that public policy and the Constitution reasonably suggest in this case that a dominant author copyright approach makes the most sense.

Still, on the IP side, one wonders whether non-copyright-based claims, such as under common law or statutory rights of publicity, might have better served the former President. As noted here previously, one incapable of fitting within the definition of “author” might nonetheless have a right of publicity claim where copyright does not work, and using another’s voice for commercial gain is different from making fair use of a transcript of another’s words. See Section 51 of the NY Civil Rights Law (“Any person whose name, portrait, picture or voice is used within this state for advertising purposes or for the purposes of trade without the written consent first obtained as above provided may maintain an equitable action in the supreme court of this state against the person, firm or corporation so using his name, portrait, picture or voice, to prevent and restrain the use thereof; and may also sue and recover damages for any injuries sustained by reason of such use…) While a newsworthiness defense has been applied to Section 51 claims and like claims in other states, those have not occurred in an audio-book case using a voice to this extent of making the person, if not an author, at least a repeated and consistent co-presenter, sometimes with primary status, and sometimes referenced like or as an author of something. One should note that that is exactly how various book websites refer to the former President, such as Barnes & Noble (“Narrated by Donald J. Trump, Bob Woodward,” interestingly hyperlinking to other books authored by Donald J. Trump), and Amazon (“by Bob Woodward (Author, Reader), Donald J. Trump (Reader)”, suggesting the book is in part “by” Donald Trump but not expressly calling him an “author”), even leaving aside the Simon & Schuster page cited above.

Further, another question referenced but largely unexplored in the filings still looms. That is the issue of whether the notion of the interviews being for “’the book only’” (Woodward Moving Brief at 7), as opposed to “a book” or “books,” allows reliance or estoppel arguments. As Professors Post and Rothman described it (at 106 and fn. 79), that presents “[d]ifficult questions” that can “arise if a copyright holder exercises its right under copyright law to prepare a derivative work by using copyrighted digital material to create a new performance, and the recreated performance then exceeds the uses agreed to by the person whose initial performance was captured with consent.”

As Mary Catherine Amerine observed in her article Wrestling Over Republication Rights: Who Owns The Copyright Of Interviews?, “the law is astonishingly unclear about the copyright ownership of interviews.” Her 2017 article, which was actually cited in the Woodward moving brief, explores several cases in which the interviewer/interviewee copyright contest is explored. As to one, Taggart v. WMAQ Channel 5 Chicago, she notes that the district court found the interviewee had no copyright rights in the interview, but that the analysis was less than sharp:

As the interview was conducted in a question-and-answer format, “although the Defendant interviewer likely contemplated his questions before asking them of the Plaintiff, Plaintiff’s comments during the interview were unprepared and spontaneous responses,” which do “not rise to the level of a literary or intellectual creation that enjoys the protection of the copyright law.”

The opinion does not specify the standard for authorship applied by the court in its analysis, but this statement suggests that the court required some sort of intention and forethought for a statement to be considered a “work of authorship” worthy of copyright protection. However, the concept of “authorship” requiring an intent to create is not found anywhere in the Copyright Act itself, and is not a common-law requirement.

[Amerine, supra, at 165]

Amerine then adds (at 167) that “As the bar for originality is so low, heightening the authorship requirement of the Copyright Act by requiring intent to establish copyrightability is inappropriate and incongruous with the low originality requirement.”

Amerine then discusses later The Swatch Group Management Services Ltd. v. Bloomberg L.P. case as an example of what, in her opinion, is a better balance:

This decision, regarding remarks that the court acknowledges to be “extemporaneous,” does not apply Taggart’s elevated “intent to create” or authorship requirement that the Southern District of Illinois read into the Copyright Act. Instead, the court properly applied the Copyright Act’s low originality bar to find that such comments, although unplanned, were sufficient to create a valid copyright interest.

[Amerine, supra, at 170]

But in the end, she sees inconsistencies among the approaches in Taggart, Swatch, Estate of Hemingway v. Random House, Inc.(common law copyright in oral statements), Quinto v. Legal Times of Washington, Inc. (compilation), and Suid v. Newsweek Magazine(split copyright), and she therefore calls for greater specificity and uniformity of approach. Consequently, her preference for the Swatch approach is part of a broader request for a more definitive ruling from a higher court or courts.

Perhaps the Woodward/Trump case will present the opportunity for greater clarity, although most likely only after some later appeal. For a journalist like Woodward, scoring one interview of Donald Trump is a good get, and scoring repeated access across months of time with a sitting president is essentially a phenomenon unique to Woodward. The question still to be decided is whether the twenty interviews were too much of a good thing and whether the Court will make the law in this area clearer or more confused. If we can come out clearer here, that would be “something gotten or obtained” that is akin to the “return of a difficult shot,” or in other words, a good get.

Court clarifies process for CMO equitable remuneration

Introduction

This case(1) concerned a collective management organisation’s (CMO’s) application for the temporary determination of related and neighbouring rights and copyrights. This was for equitable remuneration for public reproduction of intellectual works by catering businesses (ie, coffee shops). The judgment also dealt with the presumption of management and protection representative authority for CMOs.

As addressed in this case, if an application for determination concerns a use that has already been carried out, it would be a final determination, which has to be made by a competent regular court (excluding the procedure of injunctive measures). If the use has already occurred (and ceased), there would be no justifying reason for conducting two trials, namely one for the provisional and another for the final determination (i.e., the award of the equitable remuneration). If the use has clearly taken place and ceased before the exercise of the application, article 49 of Law 2121/1993 is applicable, dealing with reasonable and uniform remuneration in the context of regular proceedings or trials.

Facts

The claimant was established and operated legally, according to the provisions of Law 2121/1993, as the only representative CMO for the protection of neighbouring rights of Greek musicians, singers and producers of audio carrier materials. The claimant was, by law, entitled and obliged to administer and collect the right to equitable and uniform remuneration according to article 49(1) of Law 2121/1993 in the Greek territory. This entailed negotiating and collecting judicially and extrajudicially the reasonable and uniform remuneration as stipulated in article 49 (public performance of material carriers of music). The claimant also had the presumption of legalisation for all national and foreign beneficiaries and for all their works.

The claimant had duly published a fee schedule for businesses who may have wished to use the musical works (such as cafes, restaurants, coffee shops, refreshment rooms, fast-food restaurants, coffee-patisseries, internet cafes, etc). The defendants’ business fell within this list of businesses.

According to the claimant, in the context of their business activity, the defendants had used on a daily basis, throughout the operating hours of their businesses, physical sound speakers. The claimant alleged that these speakers had been legally procured and were used by the defendants to play recorded performances by Greek and foreign performers for the entertainment of their customers. The claimant argued that this use would have been a main factor in attracting, maintaining and increasing the defendants’ clientele, thereby increasing their revenue.

The claimant proved that, although she had invited the defendants to pay determined amounts based on her legally published fee schedule, the latter did not respond to the negotiation efforts.

Based on these incidents, the claimant requested:

a temporary determination of the amount of the equitable and uniform remuneration to which she was entitled for the years 2011 to 2021.
that the first and third parties of the defendants be compelled to provide lists of the titles of the musical repertoire they had used during the above years, in order for the applicant to proceed with the distribution of the fees to the beneficiaries; and
that the first and third parties of the defendants be compelled to temporarily pay her the half of the aforementioned amounts for the years 2011 to 2021 with legal interest dating from the service of the application.

Decision

Legal framework
Law 2121/1993
Law 2121/1993 protects the basic categories of beneficiaries of neighbouring rights. It does this by recognising performers’ and producers’ exclusive and absolute right, in some cases, (and in other cases a simple relative right to ask for an equitable remuneration) to allow or prohibit certain uses of their contributions.

Where the law establishes a right to fair or equitable remuneration, the beneficiary has only the relative right to demand this fair remuneration from users. When a legally recorded material sound medium or image is used for broadcasting or for presentation to the public, article 49(1) of Law 2121/1993 establishes a right to equitable remuneration in favour of:

the performers or performing artists whose interpretation or performance was recorded on the material medium; and
the producers of the material medium.

Law 4481/2017
Article 6 of Law 4481/2017 states:

1. The collective management organizations have indicatively the following responsibilities, as well as any other competence that is consistent with the nature and purpose of a collective management organization provided that they are included in the operating license of the Minister of Culture and Sports and provided for in their statute:

a) manage the property right, the powers deriving from it, categories of powers or types of works or objects of protection for the territories chosen by the beneficiaries,

b) draw up contracts with the users for the conditions of exploitation of the works as well as for the due, percentage or even equitable remuneration,

c) ensure the beneficiaries a percentage remuneration as defined in par. 1 of article 32 of Law 2121/1993,

d) collect the remuneration provided for in this law and in Law 2121/1993 and distribute the collected amounts among the beneficiaries,

. . .

k) proceed in accordance with the fourth paragraph of paragraph 1 of article 7 to each administration or judicial or extrajudicial action for the legal protection of the rights of the beneficiaries and, in particular, to submit requests for injunctive measures, bring lawsuits, exercise legal remedies, file lawsuits and penal complaints, appear as civil plaintiffs, request the prohibition of acts that violate the right to the powers assigned to them and request the confiscation of illegal copies or the judicial custody of the goods in accordance with article 64 of Law 2121/1993,

l) receive from the users any information necessary for the application of the fees, the calculation of the fee and the collection and distribution of royalty revenue, using the relevant recognized industry standards.

Further, article 7 of Law 4481/2017 sets out the following presumptions:

1. Collective management organizations and collective protection organizations are presumed to have the authority to manage or protect rights in all works or protected objects or all beneficiaries, for which or for which they declare in writing that the relevant powers have been transferred to them or rights of reasonable remuneration or that are covered by the power of attorney or through any other contractual agreement.

As long as a collective management organization that operates with the permission of the Minister of Culture and Sports, exercises rights or claims within the framework of Law 2121/1993, which are subject to mandatory collective management, it is presumed to represent all the beneficiaries, nationals and foreigners without exception, and all without exception their works. If, in the case of the previous paragraph, there are more collective management organizations for a specific category of beneficiaries, the presumption applies, as long as the rights are exercised jointly by all the competent collective management organizations, in accordance with the more specific provisions of Law 2121/1993. Collective management organizations and collective protection organizations may act, judicially or extrajudicially, in their own name, if their competence is based on a transfer of the relevant power, or on a power of attorney, or on any other contractual agreement. They are also entitled to exercise all rights transferred to them by the beneficiary or covered by the power of attorney or any other contractual agreement.

2. For the judicial pursuit of the protection of the works and the beneficiaries represented by the collective management organization or by a collective protection organization, a sample report of the works that were exploited without the required license or without the payment of a reasonable fee is sufficient and it is not necessary to proceed to a full enumeration of these works.

3. The presumptions are applied by the organizations in such a way that the rights of the beneficiaries, as provided for in the law, are not affected, and in particular their possibility to allocate or not to different collective management organizations all or part of the management of certain powers or of some of their works or objects of protection.

Thus, article 7 establishes a rebuttable presumption, which, in principle, functions as evidence and aims to facilitate:

CMOs’ proof of:

their IP or related rights; and
their authority to draw up relevant contracts and collect relevant fees; and

the judicial protection of the beneficiaries of these rights.

A rebuttable presumption therefore significantly strengthens a CMO’s position vis-à-vis the users of the protected works.

Foreign entities
Under article 72(3) of Law 2121/1993, CMOs may also manage related rights of foreign entities and enter into reciprocity agreements with the corresponding foreign CMOs. With these contracts, the foreign CMOs provide power-of-attorney or transfer to the domestic CMOs their rights for the purpose of their management in Greece.

Further, article 22 of Law 4481/2017, stipulates that:

1. The collective management organizations and the users conduct negotiations for the granting of licenses for the use of the rights in good faith and in this context they exchange all necessary information in order for the users to have the freedom to use the works of their repertoire, they demand from them a percentage fee according to the specified in article 32 of Law 2121/1993

. . .

6. In the event of non-payment of a fee for obtaining a license or a dispute as to the amount of the fee claimed by the collective management organization, the user must, before any use, make an advance payment to the collective management organization administration the requested fee amount or that which the Single-Member Court of First Instance will have temporarily set and awarded, upon request of either the user or the collective management organization during the injunction procedure, as usually paid in similar cases or as reasonable, if there are no similar cases . After a lawsuit brought by the collective management organization, or the user, the competent Single-Member Court of First Instance, which adjudicates during the KPolD property disputes procedure, definitively determines the fee and its amount and awards it.

7. In the event of a dispute between the user and the collective management organization as to the amount of the reasonable remuneration of article 49 of Law 2121/1992 and the terms of its payment, the Single-Member Court of First Instance, which is competent by application of the interim measures procedure, determines these provisionally at the request of the user or the collective management organization, and provisionally awards up to half of the reasonable fee it determined. For the final determination of the amount of the reasonable fee and the terms of its payment, the last paragraph of paragraph 6 shall be applied.

Court opinion on legal framework
The Court held that Greek law aims to regulate cases that cannot wait for the inherent slowness of a regular trial. Such cases include:

cases being held “before any use” (as expressly defined in article 22(6) of Law 4481/2017); and
cases being held during any use (which require an immediate determination of the fee to be paid, in order to draw up a contract between the parties and achieve the payment of the fee).

The Court held that Greek law aims to regulate these cases by providing for the possibility of a temporary determination of the reasonable remuneration (in the context of the injunction proceedings). Thus the law refers to determining the amount of the fee and the terms of its payment (ie, one lump sum or instalments, the date of payment, etc), as well as its temporary award.

Therefore, it follows that a CMO’s application to a single-member court of first instance for the temporary determination of reasonable remuneration during injunction proceedings must be made after:

negotiations with the users have taken place; and
the parties have failed to reach an agreement;

The application should be made before or during any use, in order to avoid:

arbitrariness and abusive discrimination by CMOs at the expense of users; and
users being forced to accept unfair prices.

This would be achieved by providing the possibility of negotiating the amount of the fee due, based on the users’ specific characteristics (eg, size or type of business, type of music performed, duration of use, etc). It would also allow users to decide not to use the works.

Therefore, the Court considered that, for an application to determine equitable remuneration, if it concerns use that has already been taken place, this would be a final determination. This determination must be made by the competent regular court (excluding the procedure of the injunctive measures). In the case of the past use, which has already ceased, there is no justifying reason to hold two trials (ie, for the temporary determination and for the final determination of equitable remuneration).

Court judgment
The Court held that, while the claimant’s application had been competently submitted under the special procedure of injunctive measures, it should be rejected as legally unfounded.

As highlighted in the main paragraph of the decision, the law does not provide for temporarily determining equitable and uniform remuneration according to article 49 of Law 2121/1993 through the procedure of injunctive measures. In this case, the fee related to use which had been carried out and ceased before the exercise of the application. The claimant had requested a temporary determination of her reasonable and uniform remuneration for the period between 1 January 2011 to 31 December 2021. Assuming that all the claims in her application were true, the claimant had therefore requested temporary determination of equitable and uniform remuneration for uses that had already been carried out and ceased. However, for these uses, only a final determination of the applicant’s equitable and uniform remuneration by the competent court with the special procedure of property disputes was permissible – not a temporary determination with injunctive measures. This was due to there being no justifiable reason for retrospectively holding two courts, one for the temporary determination and one for the final determination. The holding of two courts with essentially the same object would constitute excessive welfare for the applicant, which is not justified either by law or by practice.

Thus, the Court held that the application in question should be rejected as unfounded in law.

Comment

This decision follows decision No. 6024/22 of the Athens Court in which the defendants had raised a similar objection: that the practice of CMOs to make an application (related to past uses) with the procedure of injunctive relief is illegal and incompatible with fundamental principles of Greek Civil Procedure Law. In some instances, CMOs have achieved a temporary adjudication of equitable remuneration for past (and not future as the law provides) uses of background music under the special injunction proceedings (provided by article 22(7) of Law 4481/2017). This is despite Greek Civil Procedure Law prohibiting temporary adjudication of any claim in the context of injunctive proceedings with only few exceptions specifically provided by law. Equitable remuneration under article 49 of Law 2121/93 is not among these exceptions.

It is clear that Greek Courts have started to realise the legal gap in this behaviour of CMOs, which aims to circumvent the slow and lengthy ordinary proceedings of Greek civil procedure and use the provision of article 22(7) of Law 4481/2017 (which is intended for future uses) in order to obtain temporary payment of equitable remuneration for past uses. As the judgment in this case rightly states, equitable remuneration for past uses can be claimed only under ordinary and not injunctive proceedings for temporary determination.

For further information on this topic please contact Kriton Metaxopoulos at A & K Metaxopoulos & Partners Law Firm by telephone (+30 210 725 7614) or email (k.metaxopoulos@metaxopouloslaw.gr). The A & K Metaxopoulos & Partners Law Firm website can be accessed at www.metaxopouloslaw.gr.

Endnotes

(1) First-instance single-member court of Athens (457/2023).

This article was originally edited by, and first published on, www.lexology.com . Please click here to view the original publication.

Duties involving IP matters at the beginning of the corporate term in Colombia

The end of the calendar year is also, for legal purposes, the end of the corporate and accounting year, under Colombian Law.

The beginning of a new corporate year, on January 1, triggers, for corporate entities and branches of foreign companies, the need to carry out several duties, both in the form of legal obligations or in the form of managing maintenance duties, to guarantee that all matters are in line with the applicable regulations, and reflect the good status of the legal status of the entity.

Among these activities it is possible to count: the renewal of the registration of the entity with the competent chamber of commerce; accounting obligations regarding the financial statements for the preceding year, registration with the merchants registry, of all websites devoted to commercial activities; management report to be approved by the Shareholders annual meeting; registration of databases with the competent agency, among others.

Even though the focus of these activities involves, among others, accounting, financial, and the legal standing of the entity, there are also a number of tasks that involve the status of IP matters and rights held by the company. These activities must be carried out, since they are legal obligations, or because the noncompliance thereof may result in legal consequences or liability for the entity and the management, as per the following non-comprehensive checklist:

1. The management report must include a chapter where the management informs about the status of compliance of the entity with applicable regulations governing IP matters. To provide an accurate report, the management must have performed the necessary activities to verify each item included in the report, and must expressly mention in the report a list of evidence that supports the information of due compliance.

Particularly, the report must address (i) whether the company has all licenses, or other title, that enables the entity to use or access the software necessary for the development of the corporate purpose; (ii) whether the company is in due compliance with copyright regulations regarding public communication of copyrightable works, such as music, audiovisual works, or rights of actors, producers or other right-owners; (iii) compliance of contractual obligations such as licenses, coexistence agreements, and other agreements involving the use of IP.

In the event that a board member is not satisfied with the findings, an express disclaimer must be made to that effect, in the board minutes and in the report that will be reviewed by the shareholders meeting.

Failure to comply with the obligation to report the status of compliance with IP matters in the management report may encompass the imposition of fines by the Superintendency of Companies, who has the authority to request evidence of compliance.

2. Verify expiration of trademark registrations during the upcoming year, new registrations, and update of information.

The exclusive right to use a trademark in commerce, and to commence legal actions against third parties for the unauthorized use of a trademark, arises solely from registration. Trademark registrations are effective for a ten (10) year term, which is renewable for successive periods. Renewal must be applied for within the six (6) months before expiration, or within a six (6) month grace period, following expiration. Applying for renewal during the grace period encompasses payment of an additional fee.

If a trademark lapses, a new registration must be applied for, with no applicable priority.

In view of the above, for a new year, it is advisable to review the expiration dates of all registered trademarks, prepare a renewal calendar, and include the renewal expenses in the annual budget.

Also, if the features of the trademark have changed, if new graphic elements have been added or modified, or if a re-branding proceeding has occurred, among other situations, it is advisable to apply for new registrations to cover the newly adopted features of the brand.

In addition, the trademark owner must update before the Trademark Office any amendment in its corporate name, registered address, or domicile, since the trademark registry is a public registry that must reflect the actual information of right-owners.

Official fees for trademark proceedings are increased as of January 1, each year. Therefore, it is advisable to apply for renewals (when possible), new registrations or record information updates before the end of the preceding year.

3. Payment of patent annuities.

If the company owns a patent, to keep the exclusivity right arising therefrom, an annual payment for maintenance of the patent right (“annuity”) must be paid to the Patent Office in due term.

The amount of the annuity is set forth by the Patent Office on a yearly basis.

Annuities must be paid, for the following year, on the last day of the month when the patent was applied for, or within a six (6) month grace period, following expiration. Applying for renewal during the grace period encompasses payment of an additional fee.

If an annuity is not paid in due term, the patent expires, and the invention enters the public domain, thus, it may be used or exploited by any interested party.

We hope that this information is useful, and look forward to assisting your company in Colombia in connection with the compliance of duties to maintain the rights arising over IP assets.

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Key takeaway

Introduction

Facts

Decision

Comment

2. Verify expiration of trademark registrations during the upcoming year, new registrations, and update of information.

3. Payment of patent annuities.