Hong Kong Media Group Has No Protectable Goodwill in the Uk; Its Community Trade Mark Is ‘now’ Invalid
| DOI | 10.1093/jiplp/jpt257 |
| Pages | 174-176 |
| Date | 01 March 2014 |
| Year | 2014 |
| Published By | Oxford University Press |
facts is not clear in the public version of the judgment. He
states earlier in his judgment that the patent was included in
the non-assert provided by Nokia to Qualcomm ‘in certain
circumstances’. His reliance on the Tilghman’s line of case
law appears to indicate that the non-assert in respect of the
UK patent was limited in some way so that it no longer
applied. The facts supporting this conclusion are not appar-
ent from the public judgment. Whatever the factual basis of
his judgment, Arnold J held that, as a matter of English law,
HTC could not have acquired greater rights on purchasing
the chips from Qualcomm than Qualcomm was granted by
Nokia under the agreement.
US federal law: first sale or exhaustion doctrine
As the Nokia/Qualcomm agreement was subject to Dela-
ware law, Arnold J also considered t he position under US
law. US patent law is a federal matter, which is not left to
the individual states. The first sale or exhaustion doctrine
pleaded by HTC is exclusively part of US federal patent
law. Arnold J noted that the litigation was not before a US
court and did no t concern a US patent. Th e relevant
agreement was su bject to Delaware law. Arnold J con -
cluded that US federal patent law did not form part of
Delaware contract law for the purpos es of interpreting th e
agreement as it applied to non-US patents. However, he
then considered the first sale or exhaustion doctrine in
case he was wrong .
There was a dispute between the parties’ US law experts
as to whether the first sale doctrine requires the first sale to
take place in the USA, or whether a foreign sale authorized
under a worldwide licence is enough. Arnold J agreed with
Nokia’s expert that, for the first sale doctrine to apply, the
authorized first sale must have occurred in the USA. This
follows the ITC’s application of the first sale doctrine in its
recent Final Determination in the Samsung v Apple ITC
proceedings. Arnold J therefore rejected HTC’s licence
defence, holding that there was no implied licence under
English law and that the first sale or exhaustion doctrine
under US law did not apply.
Practical significance
This is a fact-specific judgment which is in part obscure
owing to confidentiality concerns. One fact-specific issue
that appears particularly relevant is that HTC had pur-
chased the chips in Taiwan where no equivalent to the
patent was in force. The specific terms of the agreement
appear also to have been highly relevant.
Practically, end manufacturers of multi-component pro-
ducts will note thatthe judgment demonstrates that the pur-
chase of components from a licensed vendor does not
automatically lead to the exhaustion of, or an implied
licence to, patentees’ rights. In instances where a global
licence is concluded between a patentee and a component
manufacturer, which then sells components to a third party,
the key point under English law is unlikely to be territorial
exhaustion but rather the precise scope of the licence and
whether it passes to downstream productsand purchasers.
Pat Treacyand Helen Hopson
Bristows
Email: pat.treacy@bristows.com
Email: helen.hopson@bristows.com
doi:10.1093/jiplp/jpt255
Trade marks
BHong Kong media group has no protect-
able goodwill in the UK; its Community
trade mark is ‘now’ invalid
Starbucks (HK) Limited and Another v British Sky Broad-
casting Group Plc and others [2013] EWCA Civ 1465, Court
of Appeal, England and Wales, 15 November 2013
The Court of Appeal unanimously upheld the High
Court’s decision that, based on the evidence, the claimant
(a Hong Kong-based media group) did not have a valid
Community trade mark (CTM) or any goodwill in the UK
that would give it the right to prevent BSkyB from using
the name ‘NOW TV’ in relation to BSkyB’sInternet proto-
col TV service. The appeal considered the requirement of
distinctiveness for a CTM to be valid and whether a repu-
tation established outside the UK could give rise to good-
will in the UK to support a claim for passingoff.
Facts
Starbucks, a Hong Kong-based media group unrelated to
the coffee shop chain, provided an Internet protocol TV
(‘IPTV’) service in Hong Kong under the name ‘NOW TV’
with some of the programmes accessible in the UK via the
Internet. Starbucks owned a Community trade mark
(CTM) in respect of television and telecommunication ser-
vices for the word ‘now’ (in lower case). The CTM was con-
sidered to be figurative because the ‘o’ in the word ‘now’
was depicted with six lines radiating from it so that it
appeared like a star or sun. In 2012, BSkyB announced, and
later that year launched, a new, stand-alone, IPTV service
in the UK under the name ‘NOW TV’. Starbucks com-
menced proceedings in the UK for infringement of its
CTM and for passing off. In the High Court, Arnold J held
that Starbucks’ CTM was invalid and that the passing-off
claim failed. Starbucks appealed.
Legal context
In the High Court, the CTM was held invalid under Article
7(1)(c) of Regulation 207/2009 (the CTM Regulation) on the
basis that the word ‘now’ would be considered by the average
Journal of Intellectual Property Law & Practice, 2014, Vol. 9, No. 3174 CURRENT INTELLIGENCE
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