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EU Law Industrial Policy & Standards Jane Winn Tom Daemen February 24, 2009 Administrative Matters • Optional Exam Review Session – Thursday 3/12 from 12:30-1:20 in Gates 117 • Homework due beginning of class 3/10 – Any case, any supplemental reading, not limited to 2nd half of quarter • Please send me email confirmation of approved topics for students writing papers in lieu of exam • Exam policies – – – – – Pick up take home exam starting Friday 3/13 return by Friday 3/20 Should be able to finish in 1 day Strict word limit similar to homework Must be typed, must be handed in in hard copy, not electronic form Completely open book, new research not encouraged, use of assigned materials highly encouraged – Focus of questions, style of answer similar to homework – Students can change from paper to exam if exam turned in by 3/20 Comparative Advertising • Introduction to Trademark and Unfair Competition Law • Economics of Advertising • US comparative advertising pioneer – Intensely competitive retail market • EU hostility to comparative advertising – Protect business, not consumers – EU driving force for reform, impact at member state level limited IP Basics: Four Main Categories • Patent – – – – • Copyright – – – – • Sometimes federal law, sometimes state law Marks that identify a unique source of goods or services Not so easy to get, pretty strong protection, no limit to lifespan Example: Blue Note Jazz Club in New York & Missouri Trade secrets – – – – • • Defined by federal law Original works of authorship Easy to get, “thin” protection, can last 100 years Example: this presentation Trademark – – – – • Defined by federal law Inventions or discoveries Hardest to get, strongest protection, shortest lifespan Example: RIM/Blackberry litigation settled for $612 million Defined by state law Economically valuable confidential information Lots of work to get, pretty limited protection, no limit to lifespan Example: Coca-Cola formula No intellectual property rights for just ideas, anything not protected is in public domain Property versus Contract – Property rights are good against the whole world – Contract rights only binding on parties to contract, not third parties US Trademark Introduction I • Protects public reputation of businesses in order to protect consumers’ expectations, make markets more efficient by reducing confusion – Identifies a unique source of goods (trade mark) or services (service mark) – New brands should not confuse consumers – How to prove infringement? Hire social scientists to survey consumers for proof of confusion • Common law trademark under state law – Winn Knowledge Management US Trademark Introduction II • Lanham Act federal trademark statute provides for optional registration – – – – Intent to use registration before first use Register trademark after “use in commerce” Trademark examiner will grant only if no prior trademarks can be found Benefits of registration: notice to the world of the claim; presumptive ownership until non-contestable; exclusive right to use mark in connection with goods or services listed in registration • TM or SM while application pending, once granted, then OK to use • Federal law and some states prohibit “dilution” of famous trademarks – No “Tiffany of Law Schools” allowed ® German Trademark Law • Rudolf Rayle, The Trend Toward Enhancing Trademark Owners’ Rights—A Comparative Study of US and German Trademark Law, 7 J. Intell. Prop. L. 227 (2000) • Closer to US idea of copyright & patent: property right of owner, not business tort or consumer protection – Not merely signaling product origin to consumers but “expression of an entrepreneur's achievement motivation” • 1989 EU Trademark Directive inclined toward this property rights interpretation of trademark more than traditional source identifying function What is Potlatch? • The potlatch is a festival or ceremony practiced among Indigenous peoples of the Pacific Northwest Coast. At these gatherings a family or hereditary leader hosts guests in their family's house and hold a feast for their guests. The main purpose of the potlatch is the redistribution and reciprocity of wealth. Economics of Advertising • Are advertisements a waste of resources? – Perfect competition requires information, but many ads do not inform • Advertisements as productive – Advertisements as “potlatch” to show success of brand – Advertisements as signal of commitment to protecting brand • Advertising as complement – Learning to be stylish Introduction to US Advertising Law • Regulated by Federal Trade Commission & State Attorneys General under unfair and deceptive trade practices authority – http://www.ftc.gov/bcp/menus/business/adv.shtm – Self-regulation: Better Business Bureau National Advertising Division • FTC basic requirements – Advertising must be truthful and non-deceptive – Advertisers must have evidence to back up their claims – Advertisements cannot be unfair • Advertisers must be able to substantiate claims – Disclaim possible incorrect inferences: “results may vary” • Mostly context specific interpretation: what impression would ad make on reasonable person? – A few mandatory limits on use of some terms: “going out of business sale” or disclosure of payments for celebrity endorsements • First Amendment right to use trademarks in commercial speech – No right to infringe or dilute trademark Comparative Advertising & Competition Policy • In the past, what differences were there between US and most EU countries re: comparative advertising? (pp 4-14) • How does US regulate comparative advertising today? • How did EU regulation of comparative advertising change with Directive 97/55/EC? – What do the BA v. Ryanair and Sabena v. Ryanair cases show about harmonization of comparative advertizing law in the EU after the Directive? (pp. 17-20