Protecting IT with IP

Intellectual property is a term that refers to the ownership of

an intangible thing — be it the innovative technology

behind a new product or service, the brand name affixed to it, the

goodwill the company making or providing enjoys, or the manner in

which the product or service and associated material are presented.

Intellectual property is now often recognised as the most valuable

asset in a business. It is hardly surprising therefore that

intellectual property disputes are increasingly prevalent, and are

some of the most hard fought.

Although intangible, the law recognises that the rights arising

out of intellectual property are property rights. As such they can

be sold, licensed, damaged and, in a recent development, converted

or unlawfully detained: Pacific Software Technology Ltd v Perry

Group Ltd [2004] 1 NZLR 164; (2003) 7 NZBLC 103,950;

(2003) 57 IPR 145 (CA).

The intangible nature of intellectual property makes it

especially vulnerable to infringement. Consequently, clearly

defining the ownership and scope of rights to intellectual

property, and effective enforcement of those rights, assumes

increased importance.

Registered and unregistered rights:

Broadly speaking, intellectual property rights fall into two

categories – registered and unregistered rights.

Registered intellectual property rights are obtained by means of

an application process, and include:

Patents: a patent provides protection for the

ideas embodied in novel technologies, products and processes.

Patents cover a principle or idea and not just a single physical

form of an invention. Therefore, the monopoly granted can be wide

in scope and cover many variations.

Design registrations: a design registration

provides protection for aspects of the appearance of an article,

such as its shape, configuration, pattern or ornamentation. Unlike

patents, a design registration does not protect functional aspects

of an article unless they also contribute to its appearance. As

most manufactured articles involve an element of designer choice,

design protection is generally available.

Trade marks: a trade mark may comprise any

marking such as a word, phrase, symbol, picture or any combination

of these. A trade mark may also be a colour, label or even a smell

or sound if these are capable of being represented graphically. The

purpose of a trade mark is to indicate a connection between certain

goods or services and the trade mark owner. More recently it has

been recognised that the connection may comprise a licence

permitting other parties to use the mark with the owner's

consent, and that trade marks may have a secondary purpose, which

is to indicate the quality of goods or services rather than simply

their origin.

Unregistered intellectual property rights subsist either as a

creature of statute or at common law. They typically operate to

prevent unscrupulous people from capitalising on the creative or

intellectual effort of the intellectual property rights-holder in

order to save time or money. Unregistered intellectual property

rights include:

Copyright: copyright is a property right that

subsists automatically in certain categories of original works,

such as literary, dramatic, musical or artistic works, irrespective

of their quality. There is no requirement to register copyright in

New Zealand. Copyright rewards the time, labour, skill and judgment

expended in creating a work. Copyright rights can be used to

prevent others from piggy-backing on that effort by copying the

work or a substantial part of it.

Layout design rights: layout design rights are

akin to copyright rights and subsist specifically in the layout of

integrated circuits.

Goodwill and reputation: goodwill is the

"attractive force which brings in custom". Goodwill and

reputation can subsist in anything from the name of a business, to

the shape and appearance of a product, or the look and feel of a

web site. Goodwill and reputation can be protected via an action

under the tort of passing off (where one person disguises his goods

or services as those of another so as to pass off those goods and

services as the original) and/or an action under the Fair Trading Act 1986 (to restrain misleading

or deceptive conduct and/or false or misleading

representations).

Confidential information and trade secrets:

where information is communicated in circumstances importing an

obligation of confidence it may be possible to restrain

unauthorised use or dissemination of that information until it

lawfully enters the public domain.

The scope of this paper:

What follows is an overview of some of these registered and

unregistered rights from an IT perspective.

Patents:

Criteria for patentability

In applying for patent protection in most jurisdictions there

will usually be three critical enquiries:

Is the invention novel?

If so, is it obvious (ie does it embody an inventive

step)?

Finally, does it meet the statutory definition of

"invention"?

Novelty

Patent legislation is designed to provide an incentive for

innovation and the introduction of new technology into New Zealand.

The legislation gives the registered proprietor the exclusive right

to make, use, or sell the invention in New Zealand and to authorise

others to do the same. Because a patent confers a monopoly on the

patentee which is potentially broad in scope, it is granted for a

limited duration only. In addition, the patentee must fully

disclose the best method of making or carrying out the invention as

a condition of the grant. Full disclosure of the invention enables

others to make and use the invention once the patent expires, or to

develop non-infringing improvements, which benefits New Zealand

society at large.

In order to warrant this monopoly the invention must be novel.

New Zealand currently applies a local standard of novelty (i.e. not

known or used in New Zealand). However there are plans to change

this to an absolute standard (i.e. an invention must be novel

having regard to the prior art base which includes all matter which

has been made available to the public in any way whether in New

Zealand or elsewhere: Patents Bill 2004 cls 6, 8 and 13(b)(i)).

The concept of local novelty has been seriously eroded by a

recent decision of IPONZ which held that a document available

electronically via the Internet before the priority date of the

opposed application met the s 2 definition of

"published": Molecular Plant Breeding Nominees

Ltd's Application Commissioner's Decision P25/2005

12/09/2005 Assistant Commissioner Popplewell at pages 27-28:

"... it is no longer necessary for a hard copy of a

document to be available to comply with the requirements of section

2. The internet, by 1999, was widely available to New Zealanders

and, in fact, a search of the 'web', by that date, would

have been considered virtually essential for any scientist engaged

in a survey of literature relevant to his field. There is no doubt

in my mind that in the present case the document concerned has been

'made available to the public'. It could be inspected

'as of right' by the public at any place where a computer

with access to the internet was available... Any person who

accesses a document on the Internet is free to download or print

it; thus it seems to me that this would be analogous to a facsimile

of a document being sent from overseas to a New Zealand resident

– such a document would surely fall within the definition

of section 2. I also note, as pointed out by Mr Arthur, that a

journal or book unopened on a New Zealand library shelf is still

'published'. Similarly, it seems to me that a document

stored electronically on a computer and freely accessible on a

computer terminal in New Zealand is 'published' whether or

not anyone actually downloads or prints it."

Non-obvious/Inventive step

Although an invention might be novel it will still need to pass

a threshold for "inventive step". The UK case of Crane v

Price in 1892 was the first to recognise that something more than

mere novelty coupled with labour or expense was required to justify

a patent. There must be some difficulty overcome or some barrier

crossed. Thus while novelty is a quantitative enquiry inventive

step involves a further, qualitative, assessment.

Thus, under s 41(1)(f) Patents Act 1953, a patent may be revoked

if the claimed invention is obvious, and does not involve any

inventive step, having regard to:

What was known before the priority date of the invention in New

Zealand; or

What was used before the priority date of the invention in New

Zealand.

In Beecham Group Ltd v Bristol-Myers Co (No 2) [1980] 1

NZLR 192, at p 232, the Court held that obviousness is to be judged

from the viewpoint of a "notional" person who is:

Skilled in the "art"; and

Knowledgeable in all relevant literature; but

Incapable of a "scintilla of invention".

Obviousness is judged as at the priority date of the patent.

Thus, an opponent cannot rely on ex post facto reasoning

to prove obviousness (i.e. the assessment must be undertaken

without the benefit of hindsight).

The test for obviousness most often applied is that set out in

Windsurfing International Inc v Tabur Marine (GB) Ltd

(1985) 102 RPC 59 (CA) where Oliver LJ described, at pp 73-74, the

process as follows:

"The first [step] is to identify the inventive concept

embodied in the patent in suit. Thereafter the court has to assume

the mantle of the normally skilled but unimaginative addressee in

the art at the priority date and to impute to him what was, at that

date, the common general knowledge in the art in question. The

third step is to identify what, if any, differences, exist between

the matter cited as being 'known or used' and the alleged

invention. Finally the court has to ask itself whether viewed

without any knowledge of the alleged invention those differences

constitute steps which would have been obvious to the skilled man

or whether they require any degree of invention."

Therefore, under the Windsurfing test, if the

difference between the...