JIPLP 10th Anniversary Conference: Part II
Neil then addressed the Starbucks litigation, over the attempt to prevent the introduction into the UK of a Hong Kong based NOW TV service, in the face of a local plan by Sky to launch its own NOW channel. The UK Supreme Court affirmed that the passing off requirement for goodwill must require proof of local goodwill. This means that there must be a UK customer base: mere access to the programmes via the internet, or familiarity with it, ie reputation, on the part of Chinese viewers in the UK, is insufficient.
In this context, Neil referred to the Australian ConAgra ruling, which like Scandecor surveyed actual business practice, but stated that the law was no longer in accord with business practice. Starbucks rejected this approach and refused to allow a passing off case to be founded on reputation alone. The mere fact that change causes uncertainty in business should not bar changes in law is no excuse: it would mean that the common law would never be able to change.
Neil's fundamental question was this. The great advantage of the common law was that, unlike the statute law which was writ in stone, it could shift flexibly in response to changes in commerce. So what had happened to it?
Neil was followed by "Competition law and IP: a new era of encroachment?" by Christopher Stothers (Arnold & Porter). This was a subtle reference to "eurodefences", a last-ditch and desperate attempt to escape liability, sometimes called "the infringer's defence". Such a defence has never succeeded in a UK trial, he added. It was initially the job of the trial judge to strike such defences out, and for the Court of Appeal to reinstate them.
Competition authorities don't really understand how the IP system works, which is a problem -- as is the fact that they have to be seen to be helping consumers. But what can we do about it? There's a need to explain things better and more clearly, since competition authorities will make better decisions if they understand IP law, and how it's used in a business context, better. Also, if IP doesn't fix itself quickly, competition law may be invoked to fix it. Patent trolls and abuse of the facility of bifurcation by suing for infringement in Germany were cited as examples.