Thursday, October 06, 2005

IP and Competition - a dose of reality

Thanks to the IPKat for the prompt notice of the decision in Sportswear v Ghattura.

On 3 October, Warren J struck out parts of a defence in what seems to be another in the line of cases of parallel importing and removal of bar codes. The twist here was the argument that an agreement existed between the Claimants which was in breach of article 81 EC Treaty; and as such, there could be no legitimate reason (notwithstanding the bar codes) for the Claimants to object to the parallel importing - hence there was no infringement. Phew.

The case is a helpful overview of the relevant English cases on this point - and refers to a new one, from June 2005, Hewlett-Packard v Expansus. All the cases stress the need for there to be a nexus between the alleged anti-competitive conduct (article 81, or article 82 abuse of a domininant position) and the alleged infringement in question, for the former to be a defence to the latter. Without such a nexus there are simply two separate questions - one of IP infringement, one of anti-competitive conduct - which must be pursued separately.

With concerns being expressed in so many fields at anticompetitive implications of IP enforcement, and anticompetitive conduct of IP owners, together with exploration of how competition law could be used to stop this, this decision is a dose of reality. If there is a nexus, then there may be a defence to infringement. But possible anticompetitive conduct in other areas (and query how narrowly "nexus" might be interpreted when it comes to the crunch) will simply not be considered by English courts. Something to bear in mind when developing abstract theories, or creative defences.

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