GUIDANCE ON UK RESALE ROYALTY RIGHTS COLLECTION; PHONEY PHONE COVERS LEAD TO SAFE MISDIRECTION

Guidance on UK resale royalty rights collection

The UK Patent Office posted this advice on its website earlier this week on the collection of artists' resale royalty rights:

"How is the right managed?

Resale right is managed by collecting societies; individual artists are not able to request payments directly. This means that the seller is required to pay all royalties to a collecting society who will then distribute them to the artist.

Which collecting society?

Under the Regulations an artist may mandate which collecting society collects resale royalties on his or her behalf. It is the artist’s choice as to which collecting society they use. Currently we are aware of two collecting societies operating in this area; the Design and Artists Copyright Society (DACS) and the Artists’ Collecting Society (ACS). However, there may be other collecting societies active in this area.

If an artist has not mandated any particular society then the collecting society which manages both copyright, in general, for all artists and artist’s resale right will be deemed to be mandated. Currently DACS is the only society which meets this criterion. Therefore any artist who has not mandated another society will be deemed to have mandated DACS to collect on their behalf. ACS was established solely for the collection of resale right and can only collect on behalf of artists who mandate them to do so.

Below: this lovely art sale picture appears on the ACS website. Can anyone tell the IPKat who painted it and, more importantly, who owns it (just in case it comes up for sale)?

Whom should I pay?

If you have completed a sale on which a royalty is to be paid, then this royalty should be paid to the collecting society which requests payment and has a mandate from the artist to collect on their behalf. If no society has such a mandate, the payment should be made to DACS who will be deemed to have been mandated in this case.

DACS will request payment of royalties on all sales of works either by artists who have mandated them to do so or by artists who have not mandated any society. DACS will not request payment on behalf of an artist whom they are aware has mandated another society. ACS will only request payment on behalf of an artist who has mandated them to do so.

Status of this guidance

This guidance provides information about the collection of resale royalties and has no legal force. This guidance should not be read as endorsing any particular collecting society, neither should the absence of a mention of any particular society be taken as indication that that society does not comply with the regulations in any way".

The site then refers readers to the websites of DACS and the ACS for further information.

The IPKat welcomes this clarification. Many people - including both sellers and artists - may be unaware that DACS is the default institution. Merpel says, I still insist that this isn't an intellectual property rights topic - it's all about the appreciation of the value of chattels.


Phoney phone covers lead to safe misdirection

R v Thompson is a decision of the Court of Appeal, Criminal Division (Laws LJ, Penry-Davey J and the Recorder of Chester) yesterday, picked up by LexisNexis Butterworth's subscription-only service. It's another interpretational case involving section 92 of the Trade Marks Act 1994, the relevant bits of which read:

"(1) A person commits an offence who with a view to gain for himself or another, or with intent to cause loss to another, and without the consent of the proprietor (a) applies to goods or their packaging a sign identical to, or likely to be mistaken for, a registered trade mark, or (b) sells or lets for hire, offers or exposes for sale or hire or distributes goods which bear, or the packaging of which bears, such a sign (c) has in his possession, custody or control in the course of a business any such goods with a view to the doing of anything, by himself or another, which would be an offence under paragraph (b) …

(4) A person does not commit an offence under this section unless (a) the goods are goods in respect of which the trade mark is registered, or (b) the trade mark has a reputation in the United Kingdom and the use of the sign takes or would take unfair advantage of, or is or would be detrimental to, the distinctive character or the repute of the trade mark.

(5) It is a defence for a person charged with an offence under this section to show that he believed on reasonable grounds that the use of the sign in the manner in which it was used, or was to be used, was not an infringement of the registered trade mark".

Thomson was the sole director of a company that sold mobile phone accessories. Trading standards officers inspected the company's stall and found a quantity of mobile phone covers that featured logos or marks of (among others) Guinness, Manchester United Football Club and Jack Daniels. These covers bore the marks ‘TM’, ‘Copyright’ and ‘all rights reserved’.

At his trial for unauthorised use of a trade mark under sections 92(1)(c) and 101(5) of the 1994 Act it everyone agreed that Thomson had not obtained the authorisation of the trade mark holders. The prosecution argued that the phone covers featured the marks as badges of origin. Thomson denied this, saying that there would be a defence of "no trade mark use" in that the logos were merely being used for decoration. The trial judge, when telling the jury which issues they had to decide, gave no direction as to whether the use of the logos would be perceived by the average consumer of the type of goods in question (ie phone accessories) as an indication of trade origin. Thomson, who was duly convicted, appealed, arguing that the judge’s failure to direct the jury in accordance with the authorities as to the test of the average consumer had rendered his conviction unsafe.

The Court of Appeal dismissed the appeal. To start with, they affirmed that the fact that a jury had been misdirected did not of itself mean that their verdict was unsafe. On the evidence in this case, the failure to direct the jury in accordance with the authorities was indeed a misdirection, but the evidence was overwhelming and the absence of the direction had to be seen in the context of a summing up which was otherwise accurate and conspicuous for its clarity. The "decoration" defence was bound to fail in all the circumstances.

Left: some of the IPKat's favourite brand-free phone covers, available here

The IPKat can't help wondering about this. If IP law is so complex and specialised that we need specialist courts and specialist judges to try civil infringement issues, why is it that criminal prosecutions - in which civil defences are routinely raised - are supposed to be easy enough for everyone to handle? Merpel says, on the decoration issue it should be remembered that it's not a question of a sign being either a badge of origin or a decoration. As the ECJ has indicated in Adidas v Fitnessworld, it can be both.

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