I am often approached by clients concerned about the implications of copyright. This might be because they have produced something they want to copyright. Or they may want to copy or play someone else’s work, perhaps as part of a business presentation.
The simple fact is that failure to respect someone’s copyright can lead to legal action against you and even criminal prosecution. So it’s important to understand:
a. what copyright is; b. what you need to do to copyright your work; and c. what penalties you could face if you copy someone else’s work.
What is copyright?
Copyright is a form of intellectual property. Intellectual Property protects the results of our intellectual efforts. Copyright protects certain original works at the point at which they become written down, recorded or otherwise fixed in some way. It gives the creator of a specific work the right to prevent anyone else from copying or reproducing it without their permission.
The works that are protected by copyright include:
• literary works such as novels or computer programmes • artistic works such as paintings, illustrations and photographs • dramatic works such as dance • musical works • broadcasts • films • sound recordings • typographical arrangements of published editions
How can you copyright your work?
There is no process for “copyrighting” your work. The right arises as soon as you put your work down on paper or in another fixed form. There is no need to register the right although you might wish to protect your interests by applying the © symbol to your work and keeping proof that the work was created by you and at what point in time.
If you have produced a literary, dramatic, musical or artistic work it will be protected by copyright for your lifetime plus 70 years after your death. This means that nobody will have the right to copy your work or a significant part of it for that time.
If anyone does want to copy all or part of your work they will have to seek permission from you as the author or from someone to whom you have transferred your rights in the work.
What are the implications of copyright infringement?
Most uses of someone else’s copyrighted work will require the copyright owner’s permission. So if you do not get the consent of the copyright owner you will be infringing copyright if you:
• copy a work • issue copies of it to the public • rent or lend it to the public • perform or show it to the public • communicate it to the public • import an infringing copy • possess or deal with an infringing copy • provide the means for making an infringing copy
You will also be committing a criminal offence if you deliberately infringe copyright for commercial purposes, for example by selling pirate films.
If you infringe copyright, the copyright owner could be entitled to an injunction to prevent the unauthorised use of the work and damages for loss. If you commit a criminal copyright offence, this could be punishable by imprisonment.
Legal advice on copyright issues
Do you need to defend your copyright against someone who has copied your work without permission? Or do you need to find out how to use someone else’s work without breaching copyright?
If you are concerned about the implications of copyright, contact me, Katie Cooper, or one of our other commercial lawyers on 01332 340211.
The Bribery Act 2010 came into force on 1st July 2011. It aims to prevent bribery by modernising and simplifying the law and allowing the Justice system to deal effectively with those offences.
The Act affects businesses registered or doing businesses in the UK, individuals who live in the UK or British Citizens. It applies to both the public and private sectors.
People can have many different ideas about what constitutes bribery, but the Act itself defines ‘bribery’ as “giving someone a financial or other advantage to encourage them to perform their functions or activities improperly or to reward them for doing so”.
The Act creates various offences including:
- Promising or giving a bribe
- Taking or requesting a bribe
- Bribing a public official
- Failure to prevent bribery
The Bribery Act Corporate Offence
The Act also creates a corporate offence. As a result, commercial organisations can now be liable for failing to prevent acts of bribery committed by individuals who work for them.
In short, a business can now be prosecuted if a person associated with the business bribes another person to obtain business or some other advantage for the organisation.
Under the Act an ‘associated person’ is anyone who performs a service for the organisation such as an employer, agent or contractor.
The offence can be committed by any business registered in the UK or carrying out all or part of its business in the UK.
Penalties for breaching The Bribery Act
There are severe penalties for businesses that get involved in bribery. These include:
- Unlimited fines
- Debarment from public contracts
- Personal liability for senior officers
So how can businesses protect themselves?
It is a corporate defence for a business to show that it has adequate procedures in place to prevent bribery.
Unfortunately, The Bribery Act does not explain what it means by ‘adequate procedures’. However, the Ministry of Justice has provided some guidance by suggesting that businesses follow six principles to help them avoid bribery.
These principles are:
- Proportionate procedures
- Top level commitment
- Risk assessment
- Due diligence
- Monitoring and review
For more details on these principles you can click here to view a video on The Bribery Act.
Flint Bishop’s commercial lawyers can advise you on how to ensure you comply with the above principles. In particular, you should look to:
- Review your policies and procedures
- Train your staff
- Include anti-bribery provisions in your contracts
- Carry out due diligence
What about Corporate Hospitality?
This is an area which businesses seem particularly concerned about? Can they take a client out to a meal or a football match? Can they send Christmas gifts or host a client Golf Day?
The good news is that so long as any corporate hospitality you provide is reasonable and proportionate you will not be in breach of the law. However, you should not engage in hospitality which is:
- Excessively or unusually generous
- Designed to influence a decision maker to act improperly
Trademarking a name, whether for your business, product or service, is very important for building brand awareness and differentiating you in your marketplace.
That is because once you have trademarked your name, nobody has a right to copy it and use it for their own brand image.
You can trademark the words in your name as part of a particular design, often referred to as a logo or a brand.
Trademarking a name for business
Your distinctive trade mark will come to represent your brand values and your customers’ expectations of their experience when using your business, products or services.
As such, it has an innate value to your business and should be protected. If not protected as a trademark, it can be open to abuse by competitors wanting to exploit some of your own success.
After trademarking a name you also need to think about how you will contract out your intellectual property rights so that other business partners can use it.
For example, if you are looking to become involved in a joint venture with another company and they want to use your trademark to help them sell your products in another country, you will need to think about how to do this without putting your brand at risk.
Trademarking a name for certification and membership
If you are a trade association, government department or technical institute looking for a trade mark that denotes a particular standard or characteristic then you will need to register what is called a Certification Mark.
Trade associations also need a brand which members can use to demonstrate their membership. For this, you will need to register what is known as a Collective Mark.
When your trade mark cannot be registered:
• It is not distinctive i.e. it does not distinguish your goods and services from others in the marketplace • It describes your products or services in any way, for example, their quality or value • It has become customary in your market sector • It is offensive or against the law • It is three dimensional, shaped in whole or in part like the products you are interested in, has a function or adds value to your products • It is a specially protected emblem such as a State emblem or hallmark • It is deceptive, for example, as to quality, suitability, etc
How do I register a trade mark?
As commercial solicitors we can advise you on how to register your trade mark in the UK and the EU. We can also advise you as to whether we think your trade mark is acceptable before you apply for registration. And we can check to see whether your trademark is already registered by someone else.
Just as importantly, we can also ensure your trade mark and any of your other intellectual property rights are protected in your commercial contracts with suppliers, clients and business partners.
In an ideal world, all suppliers would receive payment upfront for the goods they supply and thereby eliminate the risk of not being paid. In reality, though, we know that you sometimes need to supply your goods on credit.
If customers don’t pay you should be able to bring a claim to recover the debt but what if you want to avoid legal proceedings or it turns out that the customer is insolvent and not worth suing? This is where retention of title clauses come in.
In its simplest form, a retention of title clause is a clause in a contract which states that until the supplier has been paid in full for goods supplied, those goods will remain the supplier’s property. This clause should be supplemented by other rights and obligations such as:
• an obligation on the customer to safeguard and insure the goods • a right for you to enter the customer’s premises to repossess the goods • a list of events (such as non payment or insolvency) that will trigger the right to repossess the goods
If you are supplying goods, you should include a retention of title clause in your terms and conditions.
How well do retention of title clauses work in practice?
There are limits to the effectiveness of retention of title clauses. For example:
• Retention of title clauses only work if they are incorporated into the contract with the customer – in other words the customer has to agree to the clause, either expressly or by implication (for instance because they have been sent your standard terms and proceeded with the purchase) • If the goods you supply are perishable or have a fluctuating value a retention of title clause is of little value • If the customer is put into administration, the clause will be difficult to enforce
The effects of administration
The purpose of administration is for the administrator to try to rescue a business as a going concern. In order to achieve this, relevant legislation prevents third parties exercising their legal rights against a company in administration without the consent of the administrator or permission of the court. In other words, you cannot simply repossess your goods if the customer is in administration.
Maximising your right to recover your goods from a customer in administration
If your customer enters administration, there are things you can do to maximise your chance of recovery. Strictly speaking, the administrator should not dispose of your goods without your consent. If they do, you will have a claim against them unless they can show that they have reasonable grounds to believe that they were entitled to dispose of them. For this reason, you should notify your customer and the administrator as soon as possible that you consider the goods to be your property.
Steps to take
If you are concerned about not getting paid for goods you have supplied you should:
• Review your terms and conditions to make sure they include a retention of title clause • Make sure that the terms and conditions are incorporated into your contracts with customers – ideally you should get your customers to confirm acceptance of your terms • Keep an eye on your customer and if an event triggering your right to repossess happens, exercise your rights immediately. • If your customer enters administration, make sure you tell the administrator that the goods have not been paid for and remain your property
If you would like further advice on retention of title clauses or on other ways that you can use your terms and conditions to protect you please contact Katie Cooper on 01332 340211 or at email@example.com.
If you had a contract dispute tomorrow with one of your key clients or suppliers what would it cost your business in time, money and stress?
Contract disputes are one of the most common reasons for litigation in business and even the most smooth-running of businesses are not immune, but the good news is that you can minimise the risk by managing the contract process carefully.
To help you do this, I have put together this free Top 10 Tips guide to help you avoid contract disputes and prepare you for if they arise.
1. Do your research
If you and the other party have previously worked together, think about how they performed on those occasions. If you have had problems with them, be wary of any reassurances that things will be better this time. If you have not dealt with the other party before or not for some time, find out everything you can about them, including how secure they are financially. In this way, you can gauge whether or not the other party is likely to default on their obligations.
2. A verbal contract is just words
Ideally, a lot of businesses would like to rely on a “gentlemen’s agreement” in the certainty that the other party will keep to their word but, in reality, this is very risky. To ensure that the other party fulfils its obligations to you, insist on a written contract. This will provide certainty for both parties on what is expected and it is more likely that disputes will be resolved more quickly if there is a clear record of the relevant obligations.
3. Know what you are signing up to
It is quite common for businesses to create a written contract without fully considering the implications of the written terms or making themselves aware of what terms might be implied by law. A frequent cause for contract disputes is where the parties have a different understanding of their obligations under the contract. Make sure you are certain of what your rights and obligations are and, if in doubt, seek legal advice.
4. Test the waters
Unless you have absolute confidence in the other party, it might be better to agree a short contract term or, if you want a longer contract, ensure you have a break option part way through. You need to think carefully about the termination provisions in the contract. Contracts often allow you to terminate if there is a significant breach by the other party but you might also want to insist on being able to end the contract if more minor breaches keep happening.
5. Take control
Think about appointing a specific employee to manage a particular contract. This will help you avoid the disastrous but avoidable situation where nobody really knows the status of the contract or who is supposed to be doing what.
6. Diarise and record
You should always diarise key dates such as project milestones or deadlines for serving notice to terminate the contract. Go over your contracts on a regular basis to ensure things are going to plan and think about whether or not you can terminate the contract if they are not. Make sure you keep records of all your communications with the other party so you can prove what has been discussed and agreed should this become necessary in the future.
7. Talk about it
Sometimes the contract will require you to communicate at specific times, for example to exercise a particular right or give notice to terminate the contract. However, it is also important to let the other party know if you expect to experience a problem, for example if you know you are not going to meet a deadline. If they agree in writing to accept a later date, they are unlikely to bring a claim against you in respect of the delay.
8. Claim or maintain?
Whilst sometimes necessary, the court process is expensive and can damage what might still be a beneficial business relationship. Even if you have a valid claim against the other party, assess whether maintaining that relationship will be more valuable to you than going to court to get compensation or whether a deal can be done to avoid a claim.
9. Don’t lose control
Disputes can develop into more serious problems if a minor issue is allowed to build into a bigger one. For example, if you are owed money by the other party, however small an amount, chase them for payment and make sure your debt recovery policy is clearly communicated. At least if you chase and payment is not forthcoming, you might be able to cut your losses. If the bills start mounting, litigation might be the only option for recovering the debt.
10. Consider out of court negotiations
There are various ways other than litigation to resolve a dispute and you should always explore these first. In fact, you might want your contract to oblige the parties to consider various forms of alternative dispute resolution (ADR). For example, your contract could oblige the parties to hold a without prejudice or “off the record” meeting to discuss concerns or use a mediation service. These methods of resolving the dispute might prove to be quicker and cheaper than court proceedings and could preserve the goodwill between the parties.
As for many businesses, the know-how, trade secrets and other sensitive or confidential information created and owned by your business could be among its most valuable assets. Ensuring that people within your organisation keep your confidential information confidential can be a challenge in itself. However, there are also circumstances in which your information will need to be disclosed to the outside world. This might be because you are selling your business, looking for investment in your ideas or because a third party is providing a service to you that involves access to your information.
The general law does offer some protection for our confidential information. If you share confidential information in circumstances which give rise to an obligation of confidentiality (for example, if the information is obviously confidential) a duty of confidence arises. If that duty is breached, you might have a claim for “breach of confidence”.
However, a claim for breach of confidence could be difficult to establish and the burden would be on your business to prove that the duty had arisen and had been breached. For this reason, many businesses would prefer to impose contractual obligations of confidence via what is known as a confidentiality agreement or non disclosure agreement.
A confidentiality agreement can protect specific information or be more general and aim to protect all information of a confidential nature. Care should be taken, however, to avoid statements that all information shared by your business must be treated as confidential, as this is likely to be seen as too wide and therefore unenforceable. For the same reason, the length of time for which restrictions should be realistic and reasonable.
A confidentiality agreement can also address concerns such as the security arrangements that the other party will put in place for keeping your information safe and which employees of theirs will have access to the information.
If you are thinking of sharing your information with a third party, make sure you get them to sign a confidentiality agreement at the earliest possible opportunity. If you leave it too late, and the third party has already had the information, you might find that it is reluctant to sign.
If, on the other hand, you are asked to sign a confidentiality agreement in relation to someone else’s confidential information, check the terms of the agreement carefully. You should avoid any obligations in relation to information which is already publically available or which you might be able to get by other means. Even if you are not asked to sign an agreement, be mindful of your obligations under the general law and, if you have any doubt as to whether you are free to use information you have received, take legal advice.
For further advice on confidentiality agreements or the duty of confidence, please contact Katie Cooper on 01332 340211 or at Katie.firstname.lastname@example.org.
Derby-based law firm Flint Bishop has been appointed to the steering committee of the 2012 Lord Stafford Awards and has been chosen as one of the main sponsors.
They join fellow Marketing Derby bondholders and steering committee members University of Derby and EPM Technology in supporting the Awards.
Developed in 1997, the Awards are designed to encourage innovation through collaboration between businesses and universities.
As a main sponsor of the Awards, Flint Bishop will be offering discounted legal services to applicants, finalists and partner universities.
Applicants will get one year’s free use of Flint Bishop’s innovative web and telephone-based employment law and HR advice service, FBSupport, as well as a free commercial health check to highlight elements of legal risk or non-compliance in their businesses.
Universities will also get free access to www.fb-support.co.uk, as well as free and discounted advice on employment and commercial law issues. In addition, they will get a number of free and heavily discounted debt recovery cases and unlimited usernames for access to Flint Bishop’s innovative 24/7 online debt recovery system.
Head of Commercial Law at Flint Bishop, David Miller, says: “As a firm, we attribute much of our growth to innovation, especially with products such as FBsupport and www.fbdebt.com. As a result, we are heavily committed to the Lord Stafford Awards’ aim of transforming the future of the Midlands by encouraging knowledge transfer and collaborative projects between the region’s businesses and universities”.
Lord Stafford, Patron of the Awards, said: “We are delighted to have Flint Bishop on board as one of the main sponsors of the Lord Stafford Awards. As a company which has been built on a foundation of innovation, I know they have the vision and understanding that will be vital in developing the awards going forward.”
Most people who use twitter don’t tend to take the business of tweeting too seriously and use twitter as a fun way of sharing information. However, the recent reports of potential abuse of twitter involving well known personalities such as Louise Mensch, Tom Daley and Kevin Pietersen, raise questions as to what is legally acceptable tweeting.
Without giving an exhaustive account of the legal risks associated with twitter, I would advise all tweeters to monitor their tweets to avoid committing one or more of the following criminal or civil offences:
1. Defamation – if a tweet makes a false statement about someone that lowers that person’s reputation in the view of others, that statement could amount to libel and the tweeter could be obliged to pay compensation
2. Malicious Falsehood – if a statement made on twitter is intended to damage someone’s business, it could amount to malicious falsehood.
3. Harassment – if someone engages in a course of conduct that a reasonable person would see as harassment, both a civil and a criminal offence could have been committed. The criminal offence is punishable by up to 6 months’ imprisonment.
4. Assault – an assault takes place if someone does something that causes another reasonably to believe that physical harm is imminent. It is possible that a tweet could have this effect and that the tweeter will have committed a crime.
5. Copyright Infringement – if the content of a tweet is simply copied from the work of another author, this could amount to copyright infringement.
6. Deceit or Misrepresentation – if a tweet contains a false statement that causes a person to act on it, it could amount to an act of deceit or a misrepresentation, as a result of which the tweeter could be liable to pay damages.
The above are just a few examples of laws than could be offended by tweeting. There are other examples and, of course, countries other thanEnglandandWalesmay have their own rules. It’s probably safe to say that most tweets won’t offend these laws because they will be factually accurate and inoffensive. Nevertheless, it would be wise for all of us to tweet with care.
For advice on commercial law matters, please contact David Miller or Katie Cooper on 01332 340211.
You might have read our recent e-shot about Heads of Terms. We explained that Heads of Terms can be used to demonstrate the parties’ intentions at a particular stage of the negotiations or to act as a record of what has been provisionally agreed and what terms remain to be decided. They can also create contractual obligations, depending on the wording used.
Heads of Terms can take the form of “letters of intent” which record parties’ intentions in relation to a future contract. However, they can also be drafted in such a way that they create a contractual relationship. If letters of intent are being used to impose contractual obligations, this should be made clear, as should the nature and extent of those obligations.
The pitfalls of letters of intent were seen in the recent case of Charles Shaker v Vistajet Holdings SA. Shaker wished to purchase an aircraft from Vistajet but needed the backing of a financier. Shaker and Vistajet signed a letter of intent under which Shaker paid a deposit and agreed to “proceed in good faith” in respect of obtaining finance. Vistajt agreed that if, despite proceeding in good faith, Shaker had not obtained finance by a cut-off date, it would return the deposit. These parts of the letter were expressed to be binding.
The cut-off date arrived and Shaker had not secured funding. Vistajet refused to repay the deposit and Shaker issued court proceedings. Vistajet argued that it was not obliged to repay the deposit because Shaker had not proceeded in good faith in respect of obtaining finance.
The court found that the condition imposed on Shaker of “proceeding in good faith” was not legally enforceable because there were no objective criteria by which it could be measured. In other words, the letter of intent was unclear and ambiguous and did not create a binding contract.
The moral of this story is that it is best to avoid entering into any kind of binding agreement until all of the terms have been agreed and the parties are clear on what their respective rights and obligations will be. If preliminary binding agreements are going to be used in respect of a part of a deal, they should at least be clear and unambiguous. A promise of “good faith” might be reassuring to the parties but it is unlikely to be upheld by a court.
A trade mark is a sign or symbol used to represent goods or services. They can be an instantly recognisable indication of who is providing a particular product and, often, what we can expect from that product (picture, for example, a big yellow “M” and ask yourself what comes to mind). Trade marks can therefore be among the most valuable of a business’s assets.
In many countries (including this one), trade marks can be registered. The effect of registration will usually be to make it unlawful for anyone else to use that trademark to denote rival goods or services. Registration can also make it unlawful for anyone to use a similar mark to denote similar goods or services. For a trade mark to be registered, it will usually be necessary for the owner to show that it is distinctive in identifying the owner’s particular product.
In this country, trade marks that are not registered still attract some protection by virtue of the law relating to “passing off”. Passing off occurs when someone uses a particular mark that has established goodwill in a business to pass off their services as being the services of the owner of the mark. The owners of the mark will be entitled to take action to stop someone from passing off. Passing off claims can be difficult to establish and it is usually preferable to register a trade mark than to rely on protecting it via a passing off action.
The chocolate makers Lindt & Sprungli (Lindt) recently tried to register the 3D sign representing the shape of their chocolate rabbit with a red ribbon. Their application was made to the Office for Harmonisation in the Internal Market.
Whilst “the Lindt Bunny” will be familiar to most chocolate lovers, the application was refused on the basis that the shape was not sufficiently distinctive. Lindt appealed, first to the EU’s General Court and then to the ECJ but both courts agreed that many chocolate makers make chocolate bunnies and the shape in question therefore lacked the requisite distinctiveness.
This case is a useful reminder both of the criteria for a successful trade mark application and of the lengths that businesses will go to in order to protect their trademarks.