Virtuoso Legal | Award-Winning Intellectual Property Law Firm.
Virtuoso Legal are a world-class Intellectual Property law firm. Our expert solicitors are experienced in all forms of intellectual property law. We have represented clients big and small, internationally and locally – for the past 10 years and we are renowned for our service.
On 5 July 2019,
His Honour Judge Hacon, sitting in the Intellectual Enterprise Court, dismissed
an application to injunct Virtuoso Legal from acting for Product Specialities
Inc. in their defence to a registered design right infringement claim brought
by Glencairn IP Holdings Ltd (“Glencairn”), who are the well-known Scottish
glassware producer, and represented by Stobbs IP.
Link to the
judgment can be found here. This
has been covered by us previously here.
In a rather
uncommon application, Glencairn sought to prevent the Leeds team at Virtuoso
Legal from acting for Glencairn’s opponent, Product Specialities Inc. on the
basis that Virtuoso Legal’s London team had previously acted for Dartington
Crystal on an earlier similar set of proceedings brought by Glencairn, which
resulted in a confidential settlement.
Background – “Chinese Walls” of the Opposition?
In late 2018, Product Specialities Inc found itself also being aggressively pursued by Glencairn in relation to their Durashield Whiskey Tasting Glass. Please see comparison below:
Glencairn’s UK Registered Design
The Durashield Whiskey Tasting Glass
In March 2019, Glencairn objected to Product Specialities being represented by Virtuoso Legal’s Leeds team on the basis that a relatively small boutique firm would not be able act for Product Specialities since another team within the firm reached confidential settlement terms Glencairn entered into with Dartington.
On 5 July 2019,
His Honour Judge Hacon dismissed the application the following basis:
While “the Dartington team at Virtuoso is aware of the contents of the Settlement Agreement and that at least some of this is confidential to Glencairn,” Virtuoso Legal has in place an effective barrier and, “[t]he likelihood of any confidential information at all being passed to Final Touch [and the team administering the Product Specialities matter] is very low.”
any prejudice caused to Glencairn would only be significant if the entirety of the Settlement Agreement were disclosed and I believe that to be extremely unlikely, to the point of being fanciful.”
– HHJ Hacon
asked his Honour to apply the case of Bolkiah decided by the House of
Lords. Judge Hacon went into detail in relation to the principles developed in Bolkiah
and stated that Bolkiah approach should not be applied with full force
to the present case. This is due to the differences between the facts in this
case and Bolkiah:
The most important difference of fact between Bolkiah and the present case is that Virtuoso has never acted for Glencairn. The potential risk posited by Glencairn is the disclosure to Final Touch of information gleaned in the Dartington mediation and thus a breach of the obligation of confidence owed by Virtuoso to Glencairn arising from the mediation. In Bolkiah there was an additional risk in play: the possibility of a breach of the continuing fiduciary duty owed by a solicitor to a former client.”
– HHJ Hacon
Therefore, only certain aspects of the Bolkiah decision have been applied here.
His Honour Hacon stated that unlike in Bolkiah, it is important to assess “any likely impact of the order sought on the current client.”
While in Bolkiah, it was held that the burden of proof shifted to the defendant, in Glencairn His Honour Hacon stated that the overall burden of proof remains with the claimant.
While the judge agreed that the risk of disclosure is greater in a small firm, the steps taken by Virtuoso Legal have been sufficient in order to avoid such disclosure.
Our Insight – “Chinese Walls” and Small Firms
This decision illustrates the importance of effective so called “Chinese Walls”. Furthermore, that it cannot be assumed that a small firm would be automatically less likely to be able to administer an information barrier. Moreover, it shows that parties can choose their own lawyers but not those of their opponents.
IP Insight – “Chinese Walls”: Claimant Fails to Injunct IP Boutique Acting for Opponents was written by Philip Partington
Last year saw the largest fine in recent years for breach of data protection legislation. The Information Commissioner’s Office (ICO) imposed a £500,000 levy against Facebook for its role in the Cambridge Analytica scandal (the one which saw Mark Zuckerberg dragged before Congress in the US). This fine was handed out under the Data Protection Act 1998, which had a maximum penalty amount of £500,000. This maximum amount has now risen since the introduction of GDPR in May 2018, to a far higher cap of 4% of the offending business’s annual turnover.
Details of circa 500,000 customers were taken by hackers after customers were diverted to a fraudulent site which harvested their payment details, booking information, names and addresses.
in a damning statement said that the breach was due to ‘poor security
arrangements at the company’.
In a statement to the BBC, the chief executive of BA said that the company was ‘surprised and disappointed’, and that they would ‘take all appropriate steps to defend the airline’s position vigorously, including making any necessary appeals’.
BA’s surprise arguable
stems from the fact that that they cooperated fully with the ICO investigation
and had found no evidence of fraud on any customer accounts which were accessed
as a result of the hack. However, ICO (whose aim is to protect information
rights) are less concerned with what hackers can do with the information that
they access and more concerned with their ability to access it in the first
In a statement,
Information Commissioner Elizabeth Denham said:
People’s personal data is just that – personal. When an organisation fails to protect it from loss, damage or theft it is more than an inconvenience. That’s why the law is clear – when you are entrusted with personal data you must look after it. Those that don’t will face scrutiny from my office to check they have taken appropriate steps to protect fundamental privacy rights.”
– Elizabeth Denham
Breaches of GDPR can incur fines of 4% of an infringing business’ annual turnover. So, whilst the £183 million may seem steep, it could have been much worse for BA, whose 4% annual turnover is more in the region of £500 million.
Marriott International Inc.
In the same week, ICO has announced another fine, this time of just over £99 million for international hotel chain, Marriot. Again, this related to a cyber attack by hackers, dating back to 2014. The difference in this case was that the attack originated outside of the Marriott group. The Starwood group of hotels had their customer information compromised, with circa 339 million guest records exposed, of which 30 million related to European residents, and 7 million related to UK residents.
The Starwood group was then acquired by Marriott in 2016. The ICO investigation found that Marriott hadn’t carried out sufficient due diligence when acquiring the Starwood group and that more should have been done to secure the systems and prevent the further compromise of customer data. In a statement, Information Commissioner Elizabeth Denham said:
“The GDPR makes it clear that organisations must be accountable for the personal data they hold. This can include carrying out proper due diligence when making a corporate acquisition and putting in place proper accountability measures to assess not only what personal data has been acquired, but also how it is protected.
Personal data has a real value so organisations have a legal duty to ensure its security, just like they would do with any other asset. If that doesn’t happen, we will not hesitate to take strong action when necessary to protect the rights of the public.”
This case is a cautionary tale of the expensive consequences of failing to carry out proper due diligence when acquiring other businesses. A failure to adequately secure the personal data of customers held by the acquired business could result in negative consequences which come to light long after the acquisition has completed.
Our Insight: Data Breach, GDPR and the State of Play
Whereas multi-million-pound corporation like BA and Marriott can arguably weather such a hefty fine and bounce back, the same may not be said for small and medium businesses. For smaller enterprises, the potential consequences of a GDPR breach could prove fatal, and it is worth bearing in mind that GDPR applies to all who handle customer data, not just the tech giants. It is well worth taking the time before any issues arise to ensure that your business is fully compliant and that all security measures which protect your customer data are sufficient.
IP Insight: Record-breaking data breach fine for British Airways and Marriott was written by Gemma Wilson
Tillman v Egon Zehnder Ltd  UKSC 32 (3 July 2019) in relation to restrictive covenants.
On 3 July 2019, the Supreme Court of the UK issued its judgment in the case of Tillman v Egon Zehnder Ltd  UKSC 32, concerning restrictive covenants. A copy of the judgment can be found here. It is notable in that it is the first time in over 100 years that the Supreme Court has decided upon the issue of employment competition.
Ms Carolyne Tillman
was employed by Egon Zehnder Ltd from January 2004 to January 2017. Her
employment contract contained several post-termination restrictive covenants. Clause
13.2 was the central issue in the appeal. According to 13.2.3 of the employment
“…directly or indirectly engage or be concerned or interested in any business carried on in competition with any of the businesses of the Company or any Group Company which were carried on at the Termination Date or during the period of 12 months prior to that date and with which you were materially concerned during such period.”
Ms Tillman wanted to start working for one of Egon Zehnder’s competitors as of 1 May 2017. EZ brought proceedings against Ms Tillman arguing asking for an injunction preventing Ms Tillman from working for a competitor.
On 23 May 2017,
Mr Justice Mann agreed with the claimant and stated that an injunction should
be granted in order to restrain the breach of the contract.
The Court of
Appeal disagreed with Mr Justice Mann and decided that the clause was
unreasonably wide. When dealing with the point of whether Ms Tillman could even
hold shares in a competitor, the Court stated that “clause 13.2.3 does
prohibit shareholdings and is impermissibly wide and in restraint of trade
unless it can be severed in some way.”
stated further that “severance can only be applied to separate covenants and
not to parts of a single covenant.”
The Court of
Appeal’s decision would have rendered thousands of clauses in employment
The Supreme Court decision
Court agreed with the Court of Appeal in relation to the minority shareholding.
The Court stated:
the word “interested” in the non-competition covenant in the present case therefore covers a shareholding, whether large or small, and on that basis is, as is conceded, in unreasonable restraint of trade; and that, unless it can be severed and removed from the rest of the clause, the Court of Appeal was right to set aside the injunction granted against Ms Tillman.”
– Lord Wilson
The Court then
went to discuss whether the unreasonable restraint of trade can be removed from
the contract and keep the rest of the non-competition clause enforceable. It
was held that:
the words “or interested” are capable of being removed from the non-competition covenant without the need to add to or modify the wording of the remainder. And, second, removal of the prohibition against her being “interested” would not generate any major change in the overall effect of the restraints. So those words should be severed and removed.”
– Lord Wilson
v Jing Lu case
Court referred in its decision to the case of Freshasia v Jing Lu.
Virtuoso Legal’ IP Protect team, led by our director Philip Partington,
successfully defended an interim injunction application brought by FreshAsia
Foods Limited (“FreshAsia”) seeking to (amongst other things) force our client
to terminate his employment with his new employer. For more information about
the Freshasia case, read here.
Although in the case of Freshasia, Arnold J found that the employer failed to establish legitimate interests that needed to be protected by the way of the covenant and did not have to go into detail in the law of severance, the Supreme Court mentioned the importance of Mr Daniel Alexander QC’s comments in the injunction hearing. Mr Daniel Alexander QC held that
…three aspects of the covenant were unreasonably wide but that, following severance, they should be removed from the remainder.”
Mr. Daniel Alexander QC
The judge therefore observed the change of the law moving from cases such as Atwood in allowing a wider approach when it comes to severability.
Our Insight – Restrictive Covenants
While the UK courts still protect the rights of employees when it comes to unreasonable restraint of trade, it is important to note that the Supreme Court now allows such provisions to be severed from a clause which remains enforceable.
IP Insight – Restrictive Covenants: Major Victory for Employers in Supreme Court was written by Razvan Popa
Glencairn IP Holdings Ltd & Anor v Product Specialities Inc (t/a Final Touch) & Anor  EWHC 1733 (IPEC) (05 July 2019)
On 5 July 2019, His Honour Judge Hacon, sitting in the Intellectual Enterprise Court, dismissed an application to injunct Virtuoso Legal from acting for Product Specialities Inc. in their defence to a registered design right infringement claim brought by Glencairn IP Holdings Ltd (“Glencairn”), who are the well-known Scottish glassware producer, and represented by Stobbs IP.
In a rather uncommon application, Glencairn sought to prevent the Leeds team at Virtuoso Legal from acting for Glencairn’s opponent, Product Specialities Inc. on the basis that Virtuoso Legal’s London team had previously acted for Dartington Crystal on an earlier similar set of proceedings brought by Glencairn, which resulted in a confidential settlement.
summary, Glencairn unsuccessfully argued that internal information barriers
(often known as “Chinese Walls”) were not sufficient to protect the
confidential settlement agreement.
case sets new law on the issue of information barriers within law firms and demonstrates
that litigants can’t choose their opponents.
In 2018, Virtuoso Legal’s IP Protect team, led by Philip Partington, successfully defended their client Dartington Crystal (Torrington) Ltd. (“Dartington”), who are a household name and supply the likes of John Lewis and TK Maxx, in a High Court interim injunction brought against them by Glencairn.
The Dartington Proceedings related to Glencairn’s Registered Design, known as the “Glencairn Glass”, which they had alleged was being infringed by Dartington’s new “Whisky Experience” design. Please see comparison below:
Glencairn’s UK Registered Design
The Dartington Glass
In 2018, His Honour Judge Hacon, sitting in the High Court, heard Glencairn’s request for an interim injunction and considered the usual three criteria for Glencairn to overcome, but concluded that, if Glencairn was denied the interim injunction but later won at trial, any damage caused by any infringement could easily be recovered from a defendant as reputable as Dartington.
This was balanced against the harm it would have caused
Dartington to remove items of stock from its distributors’ shelves. The judge
also ruled that the balance of convenience (i.e. the status quo) was in favour
of rejecting Glencairn’s’ sought injunction.
Given Dartington had
successfully defended Glencairn’s interim injunction application, Virtuoso
Legal obtained an order that Glencairn pay £26,000 of Dartington’s legal costs.
Glencairn had itself already spent in excess of £80,000 on its own legal team in
its unsuccessful attempt to injunct Dartington.
Virtuoso Legal are a
results-based firm and often achieve such astonishing results for their
clients, so it comes as no surprise that opponents would rather we were not on
the other side.
Shortly after Glencairn’s
defeat in these proceedings, the company changed their own legal team from Geoff
Stewart of Macfarlanes to Stobbs IP.
While the parties
continued with this dispute within the IPEC, the parties settled proceedings on
a confidential basis just before Christmas 2018.
Since then, the Dartington Whisky Experience glass went on to win “Gift of the Year” 2019 in the under £10 category. https://www.giftoftheyear.co.uk/ and Dartington continue to go from strength to strength.
Product Specialities Inc.
In late 2018, Product Specialities Inc found itself also being aggressively pursued by Glencairn in relation to their Durashield Whiskey Tasting Glass. Please see comparison below:
Glencairn’s UK Registered Design
The Durashield Whiskey Tasting Glass
Product Specialities were aware that Dartington had been engaged with Glencairn in relation to a similar issue, and were directed to Philip Partington, director and head of IP Protect at Virtuoso Legal’s London office to fight their corner.
Legal London’s IP Protect team, led by Philip Partington, represented Product
Specialities until the conclusion of the Dartington mediation settlement.
At this point an information barrier was set up by Philip and Product Specialties’ defence was passed to the safe hands of Virtuoso Legal’s Leeds team -headed by the highly experienced Principal of the firm, Liz Ward.
The Unusual Application by Glencairn
2019, Glencairn objected to Product Specialities being represented by Virtuoso
Legal’s Leeds team on the basis that a relatively small boutique firm would not
be able act for Product Specialities since it knew the confidential settlement
terms Glencairn had entered into with Dartington.
reassurances from Virtuoso Legal that an information barrier had been put in
place, as is common practice in law firms, and that the relevant Virtuoso Legal
Leeds team were not aware of the earlier settlement terms, Glencairn
nevertheless sought an injunction to prevent Virtuoso Legal from acting for
July 2019, His Honour Judge Hacon dismissed the application the following
“the Dartington team at Virtuoso is aware of the contents of the Settlement
Agreement and that at least some of this is confidential to Glencairn,”
Virtuoso Legal has in place an effective barrier and, “[t]he likelihood of any
confidential information at all being passed to Final Touch is very low.”
addition, “any prejudice caused to Glencairn would only be significant if
the entirety of the Settlement Agreement were disclosed and I believe that to
be extremely unlikely, to the point of being fanciful.”
Honour Judge Hacon also stated that: “Virtuoso were instructed for good
reason and that a good working relationship has developed between Final Touch [Product
Specialities] and the team instructed. If Virtuoso could not act for Final
Touch, Final Touch would be put to the cost of instructing new solicitors
afresh with whom there may or may not develop a similarly good working
As such, Glencairn’s application was dismissed.
this remarkable set of proceedings, Philip Partington, Director and head of the
London Office of Virtuoso Legal said:
This is an interesting decision for lawyers and also business across the UK, as it illustrates the importance of confidential information and the need to set up information barriers in certain circumstances. As solicitors, we advise upon and deal with confidential information day-in-day-out and are eminently familiar with basic standards concerning the same within legal practice.
As such, to learn that Glencairn have sought bring this ill-advised application is concerning, but not surprising given their aggressive tactics during the litigation in which we were involved.
Now that this decision is public, it gives guidance for others in a similar position. However, it also serves as a stark reminder that litigants can choose their own lawyers, but not those of their opponents.”
speak to Philip Partington or any member of our IP Protect team, call:
Yes, like any original creative work GIFS are subject to copyright. But in practice, their lawful use is a slightly more complicated issue.
Let me explain.
GIFs as we well know are an image format which have become popular through their use in sharing short repeating animations.
GIFs exist within the broader culture of “memes” which are now a staunch part of internet conversation.
Alongside memes, GIFs are especially notable in their versatility with their meaning often defined not by their content but the context in which they are shared.
As such they are most commonly used on social media and messaging platforms as a means to react to a piece of content posted by someone.
Crucially, the content of GIFs that are widely available (e.g. through integrated search engines such as GIPHY) tend to range from snippets of existing copyright material (e.g. a short sequence from a film or similar motion video) or an original animation.
In each case the GIF is either itself an original creation subject to copyright, or derived from pre-existing copyrighted work.
This presents a unique problem in relation to the legal use of GIFs, as it may be argued that they contain unlicensed copyright protected material. As such, in principle, freely sharing GIFs could legitimately draw the ire of copyright holders.
Furthermore, it remains that there is no legal way to license use of GIFs for the purposes of commercial use.
So what is a commercial entity to do to mitigate the risk of a copyright dispute emerging from use of GIFs – given the current circumstances?
With sharing GIFs an incredibly widespread practice. what gives?
The Calm before the storm?
As it stands, there is little to no case law surrounding the use of GIFs.
This means two things:
Copyright owners of material in GIFs are not currently attempting to enforce their copyright in original material within GIFS
No test case exists defining the extent to which the owner claim copyright over GIF material
Sites such as GIPHY state that the GIFS on their site should not be utilised for commercial purposes.
It would take exceptional circumstances for a copyright owner (say Universal Studios) to take umbrage with a business’ sharing of a GIF to the point of issuing a legal claim on the basis of copyright.
One might imagine this if, say, a competitor studio used GIFs of Universal Studios’ films in order to launch a campaign against them on social media – or if a vehement detractor used material in a way that was extremely detrimental to the studio. and the profitability of the film from which the GIFs were taken from.
Further to this, remedies in such cases would either constitute a reasonable royalty, or damages. In each case, the cost of bringing an action would massively outweigh the likely recompense. As such, in most instances of use, a copyright claim against use of a GIF derived from or wholly comprised of copyrighted material would not be a commercially viable one.
As such, the case law that is sorely needed in relation to the legitimate use of GIFs does not seem to be coming anytime soon.
A difficult test to pass
However, if it did, the legality of use of GIFs is, in and of itself, not a clear cut issue.
In the circumstances of a GIF test case (2) there are certain requirements for something to be considered to be infringing copyright – and broadly speaking GIFs might be considered “transformative” in that they do not adversely impact the original work.
A GIF does not replace or damage the liklihood of someone watching the film it comes from, for example.
Indeed the opposite might be true, as it presents a snippet which may be widely shared and draw interest to the content in question.
There are also notions that use of GIFs might be fair use as they could be used for criticism, parody etc. in the way other copyright materials can be justly used without a license.
As such, in most cases of GIF use it may be assumed that it is both, highly unlikely that a claim would be brought, nor succeed.
However, when it comes to intellectual property law, it is always best to err on the side of caution.
Navigating the grey area.
Bearing the above in mind, the use of GIFs by commercial entities remains a bit of a grey area.
In the current climate a liberal use of any GIF will likely not result in any adverse outcomes for a commercial entity, but there are some steps that might be taken to mitigate any risk – for those looking to be more cautious.
(It is also notable that these circumstance may change soon, as GIFs become more widely used, and copyright owners establish the extent to which they are able to exercise control over their assets in this form.)
Some good rules of thumb to follow are
Avoid use of GIFs in a way in which it is likely the copyright owner would take umbrage. Generally, appropriate use is a matter of context rather than content. Placing yourself in the shoes of the copyright owner and thinking “would I disprove of this to the point of launching litigation?” is a good rule of thumb
Where GIFs are “taken” from known copyright material – provide credit to the original owner (e.g. Credit: Universal Studios)
If in doubt, avoid use of GIFs originating from highly litigious sources and seek alternatives (or make your own!)
adidas currently have over 5,000 live marks registered in the world. Most of the marks are registered in class 25 (clothing, footwear).
In December 2013, adidas applied to register the three-stripe mark mentioned above as a figurative mark in class 25 for “Clothing; footwear; headgear.” The mark was described as consisting of “three parallel equidistant stripes of identical width, applied on the product in any direction.” The mark was registered on 21 May 2014.
In December 2014, the Belgian company, Shoe Branding Europe BVBA applied to invalidate the mark on the grounds it was devoid of any distinctive character. On 30 June 2016, the Cancellation Division published its decision agreeing with Shoe Branding Europe, holding that the mark was devoid of any distinctive character, inherent and acquired through use. adidas appealed and on 7 March 2017, the Second Board of Appeal of EUIPO dismissed the appeal agreeing with the Cancellation Division’s decision. adidas appealed against the decision.
The unjustified dismissal of some of the evidence
The Board of Appeal dismissed numerous pieces of evidence submitted by adidas stating that the evidence submitted did not relate to the mark at issue.
Misinterpretation of the mark
The Board of Appeal had interpreted the mark as consisting
of “three vertical, parallel, thin black stripes against a white background,
whose height is approximately five times the width.”
adidas argued that the Board of Appeal misinterpreted the mark, as the mark represents a “surface pattern” that can be reproduced in various dimensions and proportions. adidas therefore submitted that the Board of Appeal should not have treated the mark only in specific dimensions.
The General Court disagreed with adidas and stated that “the mark at issue is an ordinary figurative mark and not a pattern mark.” The Board of Appeal was right in treating the mark as a figurative mark and according to its description.
Misapplication of the law of permissible variations
Furthermore, adidas submitted that the Board of Appeal should have applied the law of permissible variations and that the use of a mark in a different form does not alter the distinctive character of the mark.
The Court agreed with adidas stating that when it comes to the use of a trade mark within the meaning of Articles 7(3) and 52(2) of the Regulation 207/2009, “must be interpreted as referring not only to use of the mark in the form in which it was submitted for registration and, where relevant, registered, but also to the use of the trade mark in forms which differ from that form solely by insignificant variations and that are able, therefore, to be regarded as broadly equivalent to that form.”
However, the General Court disagreed with adidas when it came to the permissible variations. Firstly, the Court mentioned that the mark has an extremely simple character. Secondly, the General Court stated that since the colour scheme was reversed, this altered the distinctive character of the mark. Some of the evidence shown two stripes instead of three stripes and could not be admitted. Furthermore, where there were brought as evidence three stripes on a white background, they were clearly of a different size than the registered mark.
An error of assessment regarding the acquisition of distinctive character through use
adidas submitted that there was an error of assessment made by the Board of Appeal, arguing that the mark had acquired the distinctive character.
The General Court went on to analyse again the evidence submitted by adidas. In relation to the images submitted, the court stated that while some of the images did correspond with the mark at issue, they do not show that “that use was sufficient in order for a significant proportion of the relevant public to identify, based on the mark at issue, a product as originating from a particular undertaking.”
adidas produced an affidavit presenting figures relating to turnover, marketing and advertising expenses. As this referred to other products, the court held that the figures “do not establish that the mark at issue has been used and has acquired distinctive character following the use which has been made of it.”
Furthermore, the applicant brought 23 market surveys as
evidence of the mark having acquired distinctive character through use. 18 of
the surveys were conducted for signs different from the mark at issue and only
5 were considered to be relevant. Therefore, the 5 market surveys were
insufficient to prove the acquired distinctiveness.
Our Insight – adidas’ “three stripe” invalidation
The critical takeaway here is that “the law of permissible variations” cannot be used by big companies where the mark has significant variations. Furthermore, the companies need to carefully prepare the evidence they want to use to defend their mark and not to include unnecessary or irrelevant evidence. Underpinning all this is the importance for specialist oversight when it comes to management of complex trade mark portfolios at the outset and throughout a complex claim such as the above.
IP Insight – The invalidation of adidas’ three-stripe mark was written by Razvan Popa
Jurisdiction and governing law clauses are nowadays present in all agreements as a means to providing more clarity in relation to the relevant legislation. Both parties in an agreement will want to choose the most favourable jurisdiction and governing law to them.
Where the parties of an agreement are both based in England
and their business is based in England, they will likely include a clause
stating that the courts of England and Wales shall have jurisdiction over the
agreement and the laws of England and Wales will be applicable. However, issues
can arise where the parties are based in different countries.
What is a jurisdiction clause?
A jurisdiction clause is a provision included in an
agreement stating which courts will be able to deal with any disputes resulting
from the agreement. Let’s assume you are a clothing company based in England
and you have a dispute arising from an agreement with a company based in
Argentina. Having inserted a clause stating that the courts of England and
Wales will be dealing with any disputes arising from the agreement will make it
difficult for the Argentinian company to claim different jurisdiction.
Why should I be interested in inserting a jurisdiction
clause in my contract?
In case of a disagreement arising from the agreement, a
jurisdiction clause will save both parties time and money from fighting on the
most suitable jurisdiction. Furthermore, you will be in a better position as
you can choose the jurisdiction that you are more familiar with or the jurisdiction
that offers you most advantages. This will also save you money and time as you
can choose the jurisdiction in which you are based.
What should I consider when choosing a jurisdiction?
You may want to consider the country where you’re based or
where you’re conducting your business. Furthermore, you may choose depending
upon your preferred judicial system. The location of potential witnesses and
evidence might also be considered. You will want to choose an efficient
judicial system. Depending upon you’re likely to sue or be sued, you may
consider the remedies that the judicial system is offering for breach of
contract. The ease of enforcing a judgment may also be considered. Seeking
legal advice before drafting the contract should assist with this as your
solicitor will likely consider all the above.
Does the clause need to refer to exclusive jurisdiction?
No, depending on your needs, you can choose an exclusive
jurisdiction or non-exclusive jurisdiction clause. The exclusive jurisdiction clause will limit
any disputes arising from the agreement to one single jurisdiction while the
non-exclusive jurisdiction clause leaves the possibility for other
jurisdictions to be used if necessary.
What is a “governing law” clause?
Such a clause expresses the parties’ will for the system of
law applicable to the agreement and its effect. Therefore, the laws of a
particular country will govern the interpretation and performance of your
Why is it important to include a “governing law” clause?
As mentioned above in relation to jurisdiction clauses,
governing law clauses provide certainty in relation to parties’ desired system
of law. You will be able to choose the most favourable system to you. The
parties will most likely agree on the governing law clauses as they are
essential to a commercial agreement. If such a clause is omitted, you are at
risk at spending a large amount of money on disputes relating to the governing
law of the agreement.
What should I consider when drafting a “governing law”
More often than not, the governing law is usually chosen to be of the country in which the parties are based. You should make sure that there are no provisions in the agreement contradicting the governing law clause. This is important especially when you also have a jurisdiction clause as you will want to have some consistency in the two and choose the same legal system for both. You should also consider if there are any technical reasons for choosing a specific legal system and how that legal system might affect your agreement. Seeking and obtaining legal advice in relation to the governing law of your agreement will save you time and money.
Statement of jurisdiction and governing law in clauses can make a tangible difference to the contracts in which they are included.It creates more certainty for both parties about which law applies to the agreement and where disputes would be resolved. As such, for those not looking to be brought into foreign courts, or to accrue the associated costs, such clauses are some of the most crucial to include in agreements with international scope.
IP Insight – Jurisdiction and Governing Law Clauses was written by Razvan Popa
Under the leadership of Austrian owner Dietrich Mateschitz, Red Bull has embarked on epic forays into culture, racing, and even space have made the brand a global phenomenon.
With these activities,
Mateschitz’s company has taken what was a localised brand, and transformed it
into a global juggernaut – which has become so much more than the energy drink
Sometimes, knowing when not to
meddle with the magic is what makes a brand.
In this entry into our series of
“brand breakdowns” – we look at Red Bull, from its beginnings in Thailand, to a
world beating brand today.
The First Sip
In the 1970s, Red Bull was
marketed to farmers, construction workers and truck drivers in Thailand.
Krating Daeng (“Red Bull” in Thai) was a populist drink for the working man; a
utilitarian solution that helped you overcome fatigue, pull a double shift, or
drive all night. Soon the beverage formed a long-standing association with Muay
Thai (Thai kickboxing), which gave it popularity and street cred.
The beverage contained a potent
mix of sugar, caffeine and taurine and was bottled in a small medicinal brown
bottle with a bright and colourful label. It became a resounding success
domestically amongst it’s working class consumer base.
It was a product with clearly great potential, but seemingly waiting for its breakout moment…
It started with a humdrum
business trip to Thailand for Austrian, Dietrich Mateschitz. Over the course of
his trip he stumbled across the drink and found that it “cured” his jet lag. At
this point, he knew what had to be done. He sought a partnership with the
inventor of the beverage Chaleo Yoovidhya and sound to launch a version of the
drink that was slightly modified for European tastes.
The rest, as they say, is
In short time Red Bull evolved
from a quirky local drink to a global mega-brand in what has been a masterclass
in how to execute big ticket brand deployment. Equally, Red Bull’s success is a
masterclass in restraint and sensitivity – with Mateschitz keeping much of what
worked with “Krating Daeng” in place in the international variant.
Brand Breakdown: the trade marksLogo
Red Bull’s logo (below) is
perhaps one of the most distinct yet iconic in the food and drink sector.
Consisting of two large bulls a moment before the point of collision and a yellow circle (whether viewed as the sun, or an impending explosion) – you would find it extremely difficult to devise a logo that communicated “potential energy” better than this.
Several details in the logo
further support this connotation. Then first is the symmetry in the logo – the
two identical bulls preparing to clash are akin to the adage of “the
unstoppable force and the immovable object”. The second is the “sun” in the
background. The third is the “energy” that outlines the bulls, specifically
insofar as it is the same colour as the sun in the middle. Lastly, the colours
chosen, red and yellow are “hot” colours, which have many connotations that
support Red Bull’s brand values.
When analysing a logo, it is
important to look at what decisions were made – and what the effect would be if
alternative decisions were made.
For example, what if: 1) one of
the bulls was bigger than the other, or in a different post? 2) the “sun” in
the background was a triangle? 3) the outline of the bulls was a black line,
rather than the same colour as the “sun”, 4) the “sun” was blue and the bulls a
light shade of red.
When we think about things this
way, it becomes clearer how these design elements contribute to the visual
communication of the logo’s meaning to the audience.
In this case we have a sense of potential
energy, which, in my view, has several atomic and reactive connotations
(the important moment of collision, the sun, the symmetry of the “clash”, use
of energetic colours etc.)
Clearly this visual identity
suits the product it is adhered to. It is not a brand promise that suggests it
will make you go “faster” or be “stronger” – but rather one that gives you the
sharpness to be ready at a critical moment of need. In this way, the logo (and
other aspects of Red Bull’s brand communication, e.g. it’s “gives you wings”
slogan, and “battery”-like can) subtly communicates that it will access a reactive
energy in you – at the time when you most need it.
How has the logo been put to use?Red Bull Walk their Talk
Aside from the masterclass that
is their brand promise as communicated through their trade marks – Red Bull
selectively engages in high-profile sponsorships to associate itself with
boundary pushing activities.
What is perhaps most interesting
about these activities is that in many of their highest profile examples – they
are of sports and events which demonstrate performance on a critical moment to
moment basis (where a lack of it mean failure). Examples of this include:
Sponsorship of their Formula 1 team, the Red Bull Air Race event and even the
Red Bull Soapbox Race. In addition to this, Red Bull own four football teams:
RB Leipzig (Germany), F.C Red Bull Salzburg (Austria), New York Red Bulls (USA)
and Red Bull Brasil (Brazil) – and sponsor a range of extreme sport athletes
The most notable event is perhaps
“Red Bull Stratos” the sponsorship of Felix Baumgartner’s high-altitude dive on
the 14th of October 2012. In this instance, Baumgartner, via helium
balloon, flew roughly 39km into the stratosphere in a pressure suit, before
free falling back to earth with the assistance of a parachute. In the process
of doing this, Baumgartner set several records, including being the first
person to break the sound barrier unassisted.
Association with these sports, events and activities is not simply a case of increasing the brand’s exposure – but rather specific association with boundary pushing activities that complement their product.
Letting it Flow
It is also crucial to note that
in doing all this – their product takes a “back seat” and is positioned merely
as the embodiment of everything they are associated with. By this point the
majority of those that encounter “Red Bull” as a brand will be well aware of
the product, as such the events and sponsorship serve as a reminder of what is
possible (and enabled by Red Bull).
This is interesting as being more
“direct” in selling the product would likely undermine the message here – which
is to let the brand’s actions do the talking. This notion is further reinforced
in the sense that Red Bull do not simply sponsor many of these events and
sports teams – but in fact own them. In this way, Red Bull literally fuels
exceptional performance and are willing to place their own fortunes on the line
in the process. If that’s not an authentic brand promise – then I do not know
Whilst sports sponsorship constitutes
Red Bull’s marquee activity – they do not stop there. Red Bull has broader
interests which include: its own record label, recording studio, music academy,
publishing group, an online radio station, and recent forays into e-gaming.
In addition to all this – Red Bull also brand at the “street level” insofar as they sponsor many amateaur skaters, surfers and other individuals who do not compete at a professional level. This has the effect of cultivating a unique brand and persona by elevating individuals in status to the coolest kid on the skatepark or beach. This holism and pedigree upholds a prestigious image which sets the brand apart from it’s competitors such as “Monster Energy”. Simply put – where people are pushing the boundaries, Red Bull makes every effort to be a part of it.
Red Bull: A Big Brand with Big Protection
It is no surprise that Red Bull
are as proactive with protecting their brand, as they are in deploying it
across all the activities described above.
In the UK Red Bull protect their
brand through a number of trade marks, including word marks for the name “Red
Bull” (across classes: 3, 5, 12, 14, 16, 18, 20, 23, 24, 25, 26, 28, ,29, 30,
32, 33, 34, 35, 38, 41, 42, and 43), figurative marks for the façade of the
iconic can (in class 32), the colour combination marks for the blue and silver
on the can (Class 32), figurative marks for their logo (in classes 25, 28, 30,
32, 33, 34, 41 and 43) and word marks for “Gives You Wings (in class 32, 33 and
43) – as well as a range of subsidiary marks protecting offshoot products. (And
that’s just in the UK!)
Most controversial of these is
perhaps a colour combination mark, which caused some consternation in legal
circles, insofar as it would have set an overly broad precedent for a mark
consisting of two colours at a certain ratio. The IPKat has a good overview of
that tussle here.
Ultimately however, Red Bull’s
progressive trade mark strategy gives them a solid footing when it comes to
protecting the brand equity they have built up over the past 31 years – across
a broad scope of business activities (and not just limited to soft drinks in
An iconic and instantly
recognisable brand is only that when others who would take advantage are unable
to do so. With Red Bull comprehensively protected across all their brand
assets, across the massive scope of goods and services they have now become
associated with – the company is given an empty runway to soar to even higher
Red Bull: Conclusion
The story of Red Bull is one of
innovation. It began with the introduction of an entirely novel product which
spawned an entirely new category of product.
Since its introduction to the
international market Red Bull has since gone on to evangelise events, and
activities that reinforce their core brand values – capturing the imagination
of the public in the process. It is a remarkable feat of “joined up thinking”
and brand strategy that has elevated the beverage company to a global
There are very few other brands
which adopt both this level of authorship around their brand – and it what
makes Red Bull stand out of the category – landing the brand at 71 on the
Forbes list of most valuable brands with a stated value of $9.9billion.
Not bad for a humble pick me up drink originally aimed at perking up sleepy truck drivers.
“Psalm West” gets in on the Family Business – (Branding)
Only two weeks after he was born, Kim Kardashian registered her newborn son “Psalm West”‘s name as a trademark.
Psalm is not the first West child to be protected by a trade mark – as this has previously been seen with “North” “Chicago” and “Saint”.
Kim Kardashian West has registered the sign in categories relating to: hair accessories, calendars and books, jewellery, home furnishings, baby supplies, dolls, clothes and more, according to documents obtained from the United States Patent and Trademark Office.
Some draw criticism against the Kardashian Wests in doing the above – as it is seen as a cynical move motivated only by money. From an IP perspective however, it is a shrewd move – as the interest around the celebrity troupe is so high that others not related to the family would clamour to secure such a mark.
About How Whytes Bikes are winner in a copyright infringement with insufficient fact to prove the evidence.
Whytes Bikes are today celebrating a legal victory over the title sponsor of the Haas F1 team, Rich Energy.
The complaint that was made concerned alleged copyright infringement of Whytes stag logo by the prominent brand.
When Whytes Bikes company noticed a striking similarity between the two logos, they launched a copyright claim, which went to trial in the UK High Court in March. The judgement was released today, and it has found in favour of Whytes.
The Judge found that witness, representing defendant Rich Energy, had deliberately misled the court by claiming they were not aware of Whytes logo. She continued by saying they deliberately copied the Hastings-based brand’s stag design.
Slay in Your Lane was a best-selling book in 2018. Written by the young women, Yomi Adegoke and Elizabeth Uviebinené, its described as the “black girl’s bible”, it is an “inspirational guide to life for a generation of black British women inspired to […] find success in every area of their lives.”
It seems Ms. Adegoke and Uviebinené’s wisdom extends to intellectual property – as they registered “Slay in Your Lane” as a word mark across a host of categories.
Such a move was proven to be very savvy as the BBC used the slogan on a billboard as part of their #ChangeTheGame campaign to support women’s sport’s on their channels.
The authors surmised that the BBC had underestimated them (they had even registered in the category for advertising services!) and would assume they would take the use of their trade mark as a compliment – however, they have rightly enforced the trade mark.
Whilst headlines are typically reserved for the broader ripostes between American and China – other complainants are railing against alleged infringement eminating from Chinese producers.
Echoing Nike’s issue with OneMix, Louis Vuitton have launched a complaint against Chinese footwear company Belle International Holdings.
The defendant allegedly copied LV Archlight Sneakers under its brand “JIPI JAP” importing the shoes into Hong Kong before they were then being exported to other cities. The Claimant claims to have suffered damages as a result of the infringement.
We will still have to wait until it is almost solved, but here the comparison that LV presented in its claim. Draw your own conclusions.
Rod Stewart sued by photographer for sharing photograph
Another month passes and another celebrity is being sued for sharing an image of themselves which they had not taken!
We’ve seen celebrities getting sued for copyright infringement, last month’s IP Top 10 speaks about GiGi Hadid’s copyright case, which seeks to establish a new precedent in this area.
Sir Rod Stewart is the next person to be drawn under scrutiny. This time, the legendary singer is being sued for using a photo as a gig backdrop.
What scuppered this claim however was that the photographer who filed the lawsuit didn’t take the photo. The claimant was unable to prove that she had bought the rights to the image when acquiring a host of the photographer’s images in the mid 00s.
May 25th was the 1st birthday of our favourite piece of data protection regulation – that’s right, GDPR!
Much has changed over the course of the year since it’s inception, so McGuireWoods reflected on some of the main developments that have cropped up in the meantime.
It seems that the most impactful thing that has happened has been the high cost companies have had to outlay in order to comply with GDPR. However, they also note that the shift toward consumer empowerment over personal information has also been a significant one. Swings and roundabouts!
Indonesian Courts Kryptonite to DC’s Superman Claim
DC were recently in a trade mark dispute in Indonesia in relation to use of “Superman” on snack foods.
It seems that despite the fact that “Superman” is one of the most well reputed trade marks worldwide – DC’s failure to register the word as a trade mark in Indonesia scuppered their claim.
PT Marxing Fam Makmur, a Surabaya-based food and beverage company, had already acquired Superman trademark.
DC Comics then filed a lawsuit with the Central Jakarta Commercial Court against Marxing, claiming Superman as brand known worldwide, including Indonesia, adding that they believed Marxing had possible malicious intent for registering DC’s trademark without prior permission or approval.
The packaging suggests that PT Marxing were perhaps, somewhat inspired by the hero…
Iron Maiden claims against claim against Ion Maiden the game.
English heavy metal band Iron Maiden are suing 3D Realms with allegations that retro FPS Ion Maiden is causing confusion and muddying their brand. They want $2 million (£1.56m) in damages for the trademark terror.
Ion Maiden is a pun on the words “iron maiden” though whether it’s riffing on the name of the band or the apparently-not-medieval torture device may be up for contention.
The suit claims, Blabbermouth report, that the name Ion Maiden “is nearly identical to the Iron Maiden trademark in appearance, sound and overall commercial impression.”
It claims this is intentional by 3D Realms “in an effort to confuse consumers into believing products and services are somehow affiliated with or approved by Iron Maiden.” This is supported by pointing to online posts about Ion Maiden where comm enters seem to think it’s related to Iron Maiden – and also the band’s prior pedigree in the computer game industry.
thebigword v Language Empire & Yasar Zaman: Court of Appeal denies permission to appeal
In October 2018, we wrote about our “BIG win for thebigword” following a record-breaking award of damages, in excess of £140,000; in the IPEC – more than double the amount sought. Please see our blog here.
A few weeks later we reported that, on the same case, for the very first time, the Intellectual Property Enterprise Court disapplied the usual costs cap of £25,000 and awarded thebigword the sum of £98,000 because of unreasonable behaviour of Language Empire and Yasar Zaman, the defendants in this case. Please see our blog here.
On the 10th of October 2018, Language Empire and Yasar Zaman sought to appeal HHJ Clarke’s decision on the basis that Judge Clarke had: “erred in law in finding that the Defendants had abused the Court’s process”, which had led to the above.
22 May 2019, Virtuoso Legal’s IP Protect litigation team, led by Philip Partington were
informed that the Defendants’ appeal had been refused permission by the Court
Legal’s client, Link Up Mitaka Ltd. (trading as thebigword) are a Leeds-based
translation and transcription business with a global reach. thebigword brought
a claim against Rochdale-based competitor Language Empire Limited and company
director Yasar Zaman for use of its registered trade marks on a series of web
domains and passing off in relation to online activity dating back to 2010.
In February 2017, thebigword (the
Claimant) alleged that Language Empire and its director Yasar Zaman had
operated and maintained two websites (“the Websites”) which both infringed the
Claimant’s registered trade marks and amounted to passing off.
Domains were registered in August 2010, and held a holding page until launched
in May 2014. The landing pages of the Websites were shown to display the sign
“Big Word Translation” and a logo containing the same, as well as a number of
written uses of the mark in website copy and a copyright notice at the bottom
of the page, asserting copyright on behalf of thebigword.
Upon receipt of the pre-action correspondence from the Claimant,
the Defendants failed to reply. However, the websites were taken down shortly
after this letter was received – this was later confirmed to be upon the Yasar
this, our Mr Partington prepared and served Particulars of Claim in March 2017
which alleged that the Defendants’ creation and maintenance of the Websites had
deliberately infringed thebigword’s trade marks and as such passed off the
websites as belonging to the Claimant – in order to divert prospective
customers from thebigword to Language Empire. thebigword successfully
obtained judgment on infringement in May 2017 and the parties then fought about
the question of damages.
Judge Clarke’s Decision
Honour Judge Clarke found against the Defendants; and in doing so sought to
identify the “sum of money which will put him
(the Claimant) in the same position he would have been if he had not sustained
the wrong.” In total, Judge Clarke awarded damages of £142,044 –
including an uplift of 33% as a result of an undervaluation of the value of
lost sales to thebigword as a consequence of the infringing websites.
to damages awarded by the courts in relation to this case, it is notable that
Judge Clarke took a view upon lifting the costs cap within the IPEC, as the
nature of the case fits within the scope of such cases where this has been seen
in the IPEC before. The normal cap for the inquiry stage of IPEC proceedings is
£25, 000. There is little to no guidance in respect of lifting that cap, save
that it is only possible in “truly
exceptional” cases. The judge’s thought process is best highlighted
by the following paragraph:
I did not make this decision lightly. I accept and understand that the costs cap is a key feature and benefit of litigation in IPEC, and that certainty about the application of the Scale Costs Scheme is extremely important to facilitate access to justice for litigants in lower value intellectual property claims. However, where there is an abuse of the processes of the court, as Lord Diplock guides us, the court has a duty to identify it. If the court does not protect the integrity of the court processes to ensure that it meets the overriding objective to deal with cases justly and at proportionate cost, who will?”
(at paragraph 24)
Litigants in IPEC must understand that conduct which amounts to an abuse of the processes of the court will cause them to lose the benefit of the protection that the Scale Costs Scheme gives them.”
(at paragraph 25).
– Her Honour Judge Clarke
The Appeal: thebigword v. Language Empire Limited
2018, Language Empire and Yasar Zaman appealed HHJ Clarke’s decision to the
Court of Appeal on the basis that she had “erred
in law in finding that the Defendants [had] abused the Court’s process”.
On 22 May
2019, Virtuoso Legal were notified that the Right Honourable Lord Justice
Floyd, sitting in the Court of Appeal, had refused Language Empire’s appeal on
both grounds. In particular:
Ground 1 – the judge correctly directed herself as to the ingredients of an abuse of process and made properly reasoned conclusions as to why the applicants’ conduct had been one. She made findings in the course of her main judgment that, quite apart from giving dishonest evidence, Mr Zaman had gone to extreme lengths to hide the extent of the infringement. This court would have no basis for interfering with the judge’s factual conclusions and therefore with her conclusion on costs.
Ground 2 – This is an attempt to ask this court to re-evaluate the evidence heard by the judge without the benefit of hearing the witnesses. The judge was faced with the difficult task of attempting to assess damages in the face of the deliberate obfuscation of the applicants. It is inevitable that she will have done so liberally and by making use of inferences open to her on the evidence.”
– The Right Honourable Lord Justice Floyd
result, “the appeal would not have a real
prospect of success and there is no compelling reason for the court to hear it.”
Partington, Director and head of IP Protect, Virtuoso Legal’s litigation team
In the face of highly uncooperative defendants, missing and/or obfuscated evidence, the team had to strategise in a way that maximised the chances of a substantial damages award while minimising risk of being left with a nominal damages award and a large bill of costs to the client. My team has done this extremely successfully, setting precedent in the IPEC not only in relation to the damages achieved by the Claimant, but also in relation to the costs they were entitled to over and above the usual caps. It can only be described as a great result for our client!”
Commenting on the decision, CEO of thebigword, Nihat Arkan, said:
At thebigword we are proud of the work we do to deliver the best-in-class language services to our clients.
We are passionate professionals and truly believe in the power of breaking down barriers to connect, inspire and educate. thebigword cares greatly about our clients and their ambitions and collaborate with them to support their goals and best interests.
Unfortunately, not all companies in our industry are able to reach these high standards. We are pleased with the Judge’s decision and will continue to provide the respected service for which we have become known.
In the original decision the judge awarded substantial damages and in her findings said the defendants had chosen to obfuscate and hide the true numbers of enquiries.
The judge found that the defendant’s case consisted of “a tangled mass of contradictions, inconsistencies, unlikelihoods, implausibilities and untruths.””
– Nihat Arkan, CEO of thebigword
Chairman of thebigword, Larry Gould stated:
We are trusted around the world and the integrity of our brand remains intact. We are, of course, deeply disappointed and concerned at the impact that this potentially had on our business and the reputation of our industry.”
– Larry Gould, Chairman, thebigword
To speak to Philip Partington or our team of intellectual property specialists, please fill in the form below, or call: