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29 July 2016

In December 2015, the Mercedes Formula 1 team confirmed that they were in the midst of taking legal action against an employee who was due to join their arch-rivals Ferrari at the end of the month.

Benjamin Hoyle was accused of searching and saving Mercedes Formula 1 race data with the intention of transferring this confidential information to Ferrari. 

Mercedes released a statement confirming that “the company has taken the appropriate legal steps to protect its intellectual property".

This is an example of the importance that companies often place on their intellectual property and the steps available to employers to stop employees taking their confidential intellectual property. The steps available to employers in similar scenarios include a High Court injunction to stop the employee from transferring the data to his new company and an injunction to stop the new employer (in the case of Benjamin Hoyle, Ferrari) to use and benefit from the confidential intellectual property. A company's confidential data is often one of its most valuable assets, giving the company the competitive edge in the market. Any misappropriation and misuse can provide a competitor with a significant and unfair advantage, and the employer needs to act quickly to minimise damage or potential damage to its business.

Employers should be aware of behaviour that indicates that employees may be misusing, or considering misusing, confidential information, for example:

  • Working on projects or maintaining regular contact with customers without their line manager's knowledge.

  • Making extensive use of their personal email account or emailing documents to their personal email address.

  • Using a memory card or USB stick at work.

  • Taking documents (whether in hard copy or electronically) out of the employer's premises without authorisation.

  • Working outside their normal working hours, particularly just prior to their employment terminating or when this is not their usual practice.

  • An unusual amount of photocopying. If it is necessary to enter initials or a code before using the copiers it may be possible to detect who has been doing what.

  • Requests for secretaries or other team members to put together business information (for example, lists of customers) without an obvious business reason.

The Hoyle case represents and interesting blend of intellectual property law, breach of contract and employment law.


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29 July 2016

Magmatic, the manufacturer of the popular children’s ride-on suitcase ‘the Trunki’, has lost its long running legal dispute with rival manufacturer PMS International (“PMS”). This decision is likely to have far reaching implications for the enforceability of community registered designs against copycat products. 

The Supreme Court concluded PMS’ Kiddee Case range didn't infringe the registered design rights of Magmatic’s Trunki range, which features small, brightly coloured suitcases designed to look like animals.

Magmatic originally won in the High Court, only for that decision to be overturned by the Court of Appeal. The Supreme Court has now decided that the Kiddee Case doesn’t infringe the intellectual property contained in the design of the Trunki.

Lord Neuberger concluded that whilst it was clear that the Kiddee Case was inspired by the Trunki, what matters for design disputes is not the novelty of the idea but the details of the design. Key differences included the different use of colour and texture and the fact that the Kiddee Case has plastic covered wheels.

This decision confirms that design rights create legal protection for specific designs, not the idea that created that design. The Supreme Court found that Magmatic’s inclusion of very specific design features, including dark uncovered plastic wheels, specific texture/shading and a dark stripe meant that these features became a core part of the design. By designing the Kidde Case slightly differently, the court concluded that PMS had sufficiently distinguished its case from the Trunki so that the Kiddee Case did not infringe on the Trunki community registered design.

Magmatic contended that these specific features should be ignored, but the court ultimately decided that these specific features, in addition to the “animal with horns” aspect of the Trunki, meant that the Kiddee Case, with its covered wheels, different features and “insect with antennae” face, is sufficiently different to the Trunki.

The important point for businesses to note is how careful they need to be when first registering their designs. In hindsight, Magmatic may have been successful if the six computer-aided design (CAD) drawings used in its design application had been more generic and considered in more detail. Ultimately, the effect of this decision is that if a business does want to protect a design, any application for a community registered design must be carefully thought through and only made with the assistance of specialist advice.  

21 July 2016

With the imminent kick start to Euro 2016 and the Summer Olympics and Paralympics just around the corner, many companies may be tempted to seek to capitalise on the popularity of this summer’s sporting events. While this may seem like a lucrative advertising strategy, it’s important to do this carefully so that you don’t fall foul (sorry for the pun) of advertising regulations or the intellectual property rights of the tournaments (or individual players).

Tournament organisers are keen to enforce the rights that they hold to protect the value of their tournament, not least due to pressure from major sponsors who have paid significant sums to be associated with the tournament.  If tournament organisers don’t protect their rights, then next time when they come to sell-off sponsorship rights, they may find that their value is lower.

The Committee of Advertising Practice (which is a body associated with the Advertising Standards Agency) has issued guidance on how you can avoid being caught offside (sorry again…) of the CAP Code which regulates advertising in the UK (whether this is published in papers, magazines on your website or anywhere else) or the BCAP Code, which regulates adverts broadcast on television or radio. Whilst the CAP Code is a self-regulatory regime and the ASA cannot impose fines, they can (and do) often end up with businesses getting bad publicity and coverage in the press (together with increased scrutiny for future adverts). The guidance can be found here

As well as considering the CAP Code, businesses looking to tap into the popularity of these events should also consider whether such campaigns could fall cause issues in relation to intellectual property, including trade mark and copyright infringement. Most international tournaments will look to obtain trademarks around their logos (for example, “Rio 2016” is a Community Trade Mark protected across the EU in a number of categories of goods and services).

In relation to the Olympics, there is legislation in the UK (the Olympic Symbol etc Protection Act 1995) which protects the word “Olympics” (and similar words), the Olympic logo (the 5 rings) and the Olympic Motto and makes it an offence to use any of these in relation to trade or advertisements without permission.   

Even if trade mark or copyright infringement cannot be proven, an advertiser can still find themselves facing a red card (last one, I promise) if they are seen to be implying an association between them and the event or participants.

In short, there are likely to be intellectual property rights existing in event names, logos, mascots, photographs, event footage and much more. If a campaign uses the rights or creates an association without the consent of the owner or licensee, the campaign could come up against infringement actions – and rights owners have been keen historically to protect the value of their rights. Therefore, businesses should carefully consider their position before seeking to jump aboard the bandwagon.


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