Just how far things have gone wrong in intellectual property law is illustrated by a recent High Court case (via Outlaw.com) involving a designer who was able to stop a company (Quads4Kids, a company not affiliated with the designer) from selling quad bikes on eBay because the designer claimed that those bikes infringed upon his design rights, as allegedly found in 16 European Community designs for bikes which he had registered in February of 2006, but whose publication at registration had been deferred by the designer.
The absurdity of the situation was thus that there was no way that the alleged infringer could possibly have been aware of the actual designs for which infringements were being claimed, unless the alleged infringer had had some secret access to the 16 registrations.
Moreover, no legal action had been taken against the alleged infringer by the designer. Rather, the designer had simply invoked something on eBay called VeRO, Verified Rights Owner.
VeRO is system implemented by e-Bay whereby, as Outlaw.com writes: “owners [can] stop sales of goods in which they have rights and which are being sold without their permission.”
As we can read at eBay:
“… eBay has created the Verified Rights Owner (VeRO) Programme so rights owners can report listings that infringe their rights. Any person or company who holds intellectual property rights (such as a copyright, trademark or patent) which may be infringed by listings or items sold on eBay is encouraged to participate in the VeRO Programme.“
In other words, due to the errant intellectual property law ideas which currently have the force of law, the designer in this case felt himself empowered by the legal status quo to force a commercial enterprise from selling commercial goods on eBay, just on his say-so alone.
This was too much – even for the High Court.
“Quads4Kids, wishing to resume its sales through eBay, took a case against [the designer] by saying that his statements to VeRO were groundless threats, actionable under the Community Design Regulations of 2005. It asked for an interim injunction to prevent [the designer] from making any more threats.
The Regulations do not permit people who claim to be rights holders to make threats which they cannot back up with legal action. The law is designed to allow the threatened party to challenge a supposed rights holder’s rights in court, so that baseless threats cannot be made.
“It is entirely wrong for owners of intellectual property rights to attempt to assert them without litigation, or without the threat of litigation, in reply,” said the High Court judge, Judge Pumfrey, in his ruling. “If somebody goes around saying, ‘I will sue you for infringement of patent unless you stop buying your goods from X’, then the natural response of anybody to whom that statement is made was to stop buying the goods of X.”
“You can’t simply make a threat of infringement proceedings without having a good basis for doing so,” said John Mackenzie, a litigation specialist with Pinsent Masons, the law firm behind OUT-LAW. “It is a new example of a process for protecting IP but it still falls within the groundless threats law.”“
Essentially, the entire idea of business method, software and design trolling, which the legal establishment has foolishly permitted in the patent field and which numerous firms today are turning into a big money business, is just the scam outlined by the High Court, nor does the High Court’s decision give the patent system much relief in the future.
Pursuant to that decision, all any patent troll has to do is to lodge legal proceedings regarding his patented business method, software or design and he no longer falls under the rationale of the above decision, since whether the threat is then groundless or not is decided subsequently by the judicial system, and that can take a long time, given the vagaries of court delay. In the interim, the groundless threat standard is of no help to an alleged – and even wrongfully accused – infringer whose business can potentially – and wrongfully – be brought to its knees by the invocation of overly broad intellectual property rights, as foolishly granted by the legal system to owners of such rights.