Page 7 – CIP – The Anton Mostert Chair of Intellectual Property

Prof Karjiker’s comments on the draft the Performers’ Protection Amendment Bill [B24-2016] (the “Amendment Bill”), are submitted to the Portfolio Committee on Trade and Industry (the “Portfolio Committee”) pursuant to the invitation of the Portfolio Committee. These comments will focus on the interaction between the Performer’s Protection Act 11 of 1967 (the “Principal Act”) and the Copyright Act 98 of 1978 (the “Copyright Act”). However, the comments also raise matters of concern present in the Amendment Bill.

The full text of the comments appear below, and may be downloaded here.

1 Introduction

As a point of departure, it appears that the Amendment Bill’s proposed changes are being made to the Principal Act without regard to the amendments to the Principal Act envisaged by the Intellectual Property Laws Amendment Act 28 of 2013 (“IPLAA”).1 Is the intention that the IPLAA amendments will no longer be implemented? It is highly desirable that none of the IPLAA amendments should be implemented, and not just those which relate to the Principal Act. Thus, this is considered to be a positive development.

Accordingly, the comments below are based on the Principal Act without the amendments brought about by IPLAA.

2 Definitions

2.1 “fixation” and “audiovisual fixation”

These definitions are central to the application of the Principal Act, namely, “fixation”, “phonogram”, and “audiovisual fixation” (introduced by the Amendment Bill). Given the fact that the purpose of the Principal Act is to protect the rights of performers, the recording of a performance and exploitation of such recording should be one of the main areas of concern which the Act would seek to address. However, this concern is not consistently dealt with by the Amendment Act (and, also by the Principal Act, as it currently exists). One would expect that most provisions would seek to protect performers’ rights in relation to the exploitation of any form of recording, unless there was a specific reason for distinguishing between an exclusively aural recording, or an audiovisual recording. Thus, most provisions should simply refer to a “fixation” of a performance, which should be the umbrella term for any type of recording, be it exclusively aural recording or an audiovisual recording. In other words, if necessary, there are two subcategories of fixation, namely, a phonogram and audiovisual fixation. To this end, the existing definition of “fixation” could be amended, if desirable, by the addition of the following words “which can be perceived, reproduced or communicated by any means”. Having said that, it is not clear if a distinction between aural recordings and audivisual recordings is at all necessary. This matter need to be properly re-considered.

Subject to the aforementioned comments, the proposed definition of “audiovisual fixation” could then be simplified to read as follows: “means the visual fixation of images, by whatever means, whether or not accompanied by sounds”. Careful consideration should be given to whether the particular statutory provisions are intended to apply to fixations (that is, the recordings) generally, or specifically to phonograms or audiovisual fixations. The phrase “or by the representations thereof” in the proposed definition seems a bit odd. On this basis, the comments below will indicate some of the areas in which the particular provision shall apply to all fixations, or simply to a particular subcategory of fixation (which need, incidentally, is unclear). It may be the case, that the definitions of “audiovisual fixation” and that of “phonogram” may not be required, and that a simple reference to a form of fixation may be adequate.

2.2 “communication to the public of a performance”

Having regard to comments in paragraph 2.1 above, is there any reason why the proposed definition is limited to an audiovisual fixation? The definition could simply be in respect of a fixation, which would then cover both an audiovisual fixation and a phonogram. The definition can be amended to read as follows: “means the communication to the public by any medium, other than by broadcasting, of an unfixed performance or the fixation of a performance that members of the public may access at a place and time of their choosing, and ‘communicate to the public a performance’ shall have the corresponding meaning”.

2.3 New definition of “performance”

It would be useful to include a definition of “performance”, which could read as follows: means the physical performance by any mode of visual or acoustic presentation of a literary and artistic work and ‘perform’ shall have a corresponding meaning”.

2.4 “communication to the public of a phonogram”

See the comments in section 2.2. This definition may be unnecessary, and can, therefore, be deleted.

3 Proposed amendment to section 3

Given the fact that one of the stated objectives of the Amendment Bill is to promote performers’ moral and economic rights, the new proposed section 3(2) seems to contradict that objective. The Amendment Bill assumes that a performer may have transferred its rights terms of the Principal Act, and, on the basis of that assumption, seeks to ensure that the performer at least has some moral rights, as well as a reversionary right.2 In fact, in one material respect, the Amendment Bill appears to weaken the position of performers. Currently, the accepted view is that the rights granted to performers under the Principal Act cannot be transferred (more correctly, assigned) as the Act makes no provision for the rights granted to be transferred.3 The most obvious way to enhance the rights of performers would be to maintain the principle that the rights afforded by the Act cannot be transferred by performers.

The proposed new section 3(3) is, at best, unclear. First, although the rights granted under the Principal Act may in some respects be similar to copyright, it is not copyright. It is, thus, important to distinguish performers’ right from copyright. Second, it is submitted that the moral rights in copyright law are considered to be akin to common-law personality rights protecting honour or reputation. As such, personal rights can only be enforced by the author of the copyright work, and will, thus, terminate on the death or termination of the author.4 Accordingly, the proposed new section creates confusion. It is best not to confuse issues of copyright with that of performers’ rights, or try to oversimplify the relationship between the two concepts. For example, there would still be performers’ rights if a performer sings a song which is no longer protected by copyright, as it is in the public domain. It is also not clear whether the reference to the Copyright Act is to the general duration of copyright protection (which is potentially much longer than the term of performers’ rights) or whether it simply refers to the corresponding term for moral rights under copyright law. However, as indicated the latter is considered to terminate on death, which would defeat the purpose of trying to extend rights after a performer’s death.

Why is specific reference only made to “audiovisual fixations” (and not also to “phonograms”) in the proposed sections 3(4)(c) to (g)? See my comments in paragraph 2.1 above. The proposed sections could simply refer to “fixations”.

4 Proposed new section 3A

The initial portion (that is, the portion before the proviso) of the proposed clause appears to be of no real legal consequence. It simply says that the copyright owner of the relevant audiovisual fixation will deal with the performer’s rights in such fixation in accordance with the agreement between the parties. This would, in any event, have been the case in the absence of the provision. It’s only significance is that it stipulates that the agreement must be in writing. If that was all that was intended, the proposed section could be greatly simplified. Again, why only for an “audiovisual fixation”, and not simply for a fixation, which would also cover a phonogram, as indicated in paragraph 2.1?

The proviso is also problematic. It suggests that any agreement between the relevant copyright owner and performer will only last for a period of 25 years from the date of the commencement thereof. First, the proposed section contemplates that such agreement may have concerned a transfer of the performer’s rights to the copyright owner. In such a situation, there would be no agreement to speak of after 25 years, as the transfer effectively ends the relationship between the performer and the copyright owner. Second, even if the aforementioned characterisation is incorrect, the section does not indicate what would happen to the performer’s rights after the 25-year period. Is the intention that in those circumstances the performer’s rights would revert to the performer? Again, the phrase “and maybe novated by mutual consent” adds nothing of substance to the legal issues at hand.

5 Proposed new section 3B

In the proposed subsection 1, the problem is that the term “producer” is undefined. This creates confusion as it is not clear what the intention is. For example, if the intention is that the copyright owner of the “phonogram” (which, incidentally, is not a term used in the Copyright Act) should be the “producer”, the proposed section should dovetail with the Copyright Act. The Copyright Act defines the “author” of a “sound recording” (which is what phonogram would probably be) as “the person by whom the arrangements for the making of the sound recording were made”.

Guidance should be provided as to whether the term “producer” is considered to be the same as the “author” (or even the “owner”) under the Copyright Act, or whether there may be a distinction between the two concepts. If it is the latter case, what if there is a dispute between the “producer” and the copyright owner (or author) of the phonogram? What if the copyright owner wishes to commercially exploit the phonogram but the producer refuses to consent to such exploitation? Will this not introduce another layer of complexity? A way should be found to avoid too much fragmentation of rights. For example, the copyright owner could be the agent of the other rights holders, in a manner similar to the position which currently exists between the copyright holder of a sound recording and the performer. The royalty collected pursuant to section 9A is not only for the required right to use the particular sound recording, but also discharges any obligation to pay a royalty in relation to any performers’ rights in relation to the particular sound recording.5 Thus, section 9A also provides that any performer whose performance is featured on a sound recording is entitled to a share of the royalty in relation to the playing of the sound recording.6 The Collecting Societies Regulations provide that a collecting society who represents both the performers and the copyright owners must distribute the royalties on an equal basis between such rights holders.7

If producers are also to be given rights, the entire Principal Act needs to be reconsidered to ensure that in all relevant cases the provisions cater for both the rights of the performer and producer.

Why does the proposed subsection 2 suddenly referred to the performer and the copyright owner of a phonogram? As the provision concerns the rights of producers, the failure to mention the producers seems to suggest that producers would have no economic right, given the fact that no mention is made of the producers. Thus, the interrelation between the producers, copyright owner and performer needs to be clarified. Is it really desirable that the remuneration be a matter for the Minister to determine? What is the concern for such a drastic approach? Presumably, producers, like copyright owners and performers, would generally form part of a collecting society, which would negotiate on their behalf. Even if a particular producer was not part of a collecting society, the activities of collecting societies would indicate what the usual remuneration would be in particular circumstances.

Why is specific reference only made to “phonograms” (and not also to “audiovisual fixations”)? Why should the producer (or director) of a music video not be given the same types of rights as the producer of a phonogram?

6 Proposed amendment to section 5

Why is specific reference made to “audiovisual fixations” (and not simply to “fixations”, which would also include “phonograms”) in the proposed sections 5(1)(a)(i) to (iv), and 5(1)(b)? See my comments in paragraph 2.1 above. The proposed sections could simply refer to “fixations”, without the need to also refer to “audiovisual fixations”.

In light of the definition of “communication to the public of a performance” (as suggested in these comments), it is suggested that the words “or communicated to the public” be deleted in the proposed subsection (1)(a)(i). The issue of communication to the public should be dealt with in the proposed subsection (1)(a)(vi), which should be amended to simply read: “communicate to the public a performance of that performer”.

The additional words “or performance fixed in an audiovisual fixation” in the proposed subsection (1)(a)(ii) should be deleted as they do not make sense. The fixation has already taken place, so what consent is required?

The proposed subsection (1)(a)(iv) does not make sense because, into alia, it contemplates the possible sale of the actual performer! This can hardly promote the stated objective of promoting performers’ rights. This section can be simplified to read as follows: “make available to the public, through the sale or otherwise, of copies of the fixation of a performance by such performer”.

Similarly, in the proposed subsection (1)(a)(v), it could hardly be that the original performance could be commercially rented, as opposed to a fixation thereof. Accordingly, the section could be simplified to read as follows: “commercially rent out to the public copies of the fixation of a performance by such performer”.

Presumably, the proposed subsections (1)(b)(iv) and (v) should be with respect to “fixation of the performance (or copies thereof)” as it seems nonsensical to speak about the sale or renting out of the performance, rather than to fixations thereof.

In relation to the proposed subsection (1)(1A), it is not clear why the performer (and indeed a producer, where relevant) is not also required to sign the proposal. Furthermore, this subsection has the same problems concerning unnecessary references to “audiovisual fixations” and to “original” performance. See the comments in relation to the proposed section 1(a) above.

In relation to the proposed subsection (2), it is not clear why the performer (and producer) should not be deem to have also consented to the rebroadcasting of the relevant performance. Legislation of this nature should really serve as a type of standard-form contract, and serve to reduce the transaction costs. The proposed amendment will unnecessarily increase transaction costs. Perhaps the provision should provide for a reasonable royalty to be paid for any further broadcasts, in the absence of an agreement relating to further broadcasts.

In relation to the proposed subsection (4), the phrases “copyright owner for such/the fixation” should be changed to “copyright owner of such/the fixation”.

In relation to the proposed subsection (5), the word “or” between “performer” and “owner” should be replaced with the word “and”. Again, the reference to “audiovisual fixations” should simply be to “fixations”.

7 Proposed amendment to section 8

Again, the references to “audiovisual fixations” should be omitted and there should simply be a reference to “fixations”.

In relation to the proposed section 8(2)(e), what is a “licensed dealer”? If the term is not going to be defined, it is best to simply delete the word “licensed”.

The proposed section 8(2)(f) is inappropriate, and should be deleted. It cannot apply to the performance. As indicated above, copyright is regulated by the Copyright Act, and is a distinct right. Issues of fair-dealing in the fixation should be left to be dealt with in terms of the Copyright Act, otherwise it may result in possible confusion.

In relation to the proposed section 8(3)(a), it is not clear why there should not be a general archiving right. Archiving should not affect any of the moral or economic interests at issue. In fact, archiving should not be limited to material of an “exceptional documentary character” as it would lead to uncertainty as to what would qualify under such right. Also, it often happens that material is only later considered to be significant.

8 Proposed sections 8A and 8B

The proposed amendments to the Copyright Act which would introduce these sections referred to have been the subject of significant criticism. It would be preferable if these matters are only considered once the amendments to the Copyright Act have been finalised.

9 Other issues

What if there are multiple performers in a work? How should potential problems of hold-outs concerning the exploitation of a performance (or fixation) be dealt with? Should actions approved by the majority be permitted, and bind the minority?

10 Conclusion

While it is the case that our law concerning performers’ rights needs updating, given the international developments, the aforementioned comments should provide sufficient evidence that the current draft Amendment Bill is not currently in a state to be enacted. As with the plans to amend the Copyright Act, it is important that care is taken to ensure that our legislation is the best it can be. Despite the need to update our law relating to intellectual property rights, it would be counter-productive to rush through half-baked proposals. No one should be incentivised on the basis getting legislation passed; legislation needs to be properly considered, and should only be passed if it is in the national interest.

NOTES:

1 The preamble to the Amendment Bill states that “Amendment of section 1 of Act 11 of 1967, as amended by Act 38 of 1997 and Act 8 of 2002”. No mention is made to IPLAA in the Amendment Bill.

2 See new proposed section 3A of the Amendment Bill.

3 Dean OH, Dyer A Dean & Dyer: Introduction to Intellectual Property Law (2014) OUP at 67.

4 Dean and Karjiker Handbook of South African Copyright Law (2015) 1-112.

5 Section 9A(2)(d) Copyright Act 98 of 1978.

6 Section 9A(2)(a).

7 Regulation 8(5)(b).

Written comments on the draft Performers’ Protection Amendment Bill [B24-2016]

submitted by
Prof Sadulla Karjiker
Anton Mostert Chair of Intellectual Property Law at the Faculty of Law,

Stellenbosch University

Discussion: Court of Justice of the European Union; November 10, 2016, Case 30/15, Simba/EUIPO (full text here).

In this case the CJEU could further clarify how to apply the rule of European trade mark law providing that trade marks that consist exclusively of a shape or other characteristic of a product that is necessary to obtain a technical result cannot be protected. The decision is interesting for South African trade mark law, since section 10(5) of the Trade Marks Act contains an almost identical rule.

Simba, a toy manufacturing company, requested the European Intellectual Property Office (EUIPO) to invalidate a registration of the following trade mark registered for three-dimensional puzzles in the name of Seven Toys, on the basis that the mark consists exclusively of a shape necessary to obtain a technical result.

One recognizes the contours of the famous Rubik’s Cube puzzle.

EUIPO rejected the claim and so did the Board of Appeal. A further appeal was lodged with the General Court, but that appeal was rejected as well. However, the appeal to the CJEU was successful. The CJEU repeated prior case law saying that for the functionality exception to apply one first has to assess what the essential characteristics of the mark are. Everybody agreed that the essential characteristics at issue are a cube and a grid structure on each surface of the cube. Simba argued that the black lines and, more generally, the grid structure on each surface of the cube perform a technical function.

The General Court said that this argument was essentially based on knowledge of the rotating capability of the vertical and horizontal lattices of the ‘Rubik’s Cube’ and that that capability cannot result from the characteristics of the shape presented but, at most, from an invisible mechanism internal to that cube. The General Court held that the Board of Appeal was right not to include that invisible element in its analysis of the functionality of the essential characteristics of the contested mark. In that context, the General Court took the view that inferring the existence of an internal rotating mechanism from the graphic representations of that mark would not have been consistent with the requirement that any inference must be drawn as objectively as possible from the shape in question, as represented graphically, and with sufficient certainty.

This reasoning was rejected by the CJEU. After having reminded us of the rationale behind the functionality exception, being that it seeks to prevent trade mark law from granting an undertaking a monopoly on technical solutions or functional characteristics of a product, the CJEU said that the essential characteristics of a shape must be assessed in the light of the technical function of the actual goods concerned. Thus, and since it is not disputed that the sign at issue consists of the shape of actual goods and not of an abstract shape, the General Court should have defined the technical function of the actual goods at issue, namely a three-dimensional puzzle, and it should have taken this into account when assessing the functionality of the essential characteristics of that sign. The CJEU added that while it was necessary for the purpose of that analysis to proceed on the basis of the shape at issue, as represented graphically, that analysis could not be made without taking into consideration, where appropriate, the additional elements relating to the function of the actual goods at issue.

The lesson to be drawn from this decision (as well as from earlier decisions of the CJEU) is that whatever the representation of a product and/or the description in the registration is, the possible functionality of the essential characteristics needs to be assessed also on the basis of a detailed examination that takes into account material relevant to identifying appropriately the essential characteristics of a sign.

It seems though that taking into account factors other than those that follow from the registration itself is at odds with the legal certainty of the register. However, the rationale of the functionality doctrine (avoiding monopolizing technical solutions by trade marks) dictates that efforts are being made to avoid circumvention of the rationale by claiming such solutions in shrewd registrations.

Prof Charles Gielen

Professor Owen Dean, first incumbent of the Chair of IP Law, Emeritus Professor and current Research Fellow at Stellenbosch University has again been selected by his peers in legal practice for inclusion in the 8th edition of the list of best lawyers in South Africa in the practice area of Intellectual Property Law.

The Best Lawyers ranking is widely recognised as the oldest and most esteemed peer-review publication in the legal profession and inclusion in the list is a significant honour bestowed on the recipient by their peers after a confidential process of peer review.

Many congratulations to Prof Dean on this remarkable endorsement of his enduring leadership in IP legal practice. The Faculty of Law and its students are privileged to learn from him.

Professor Owen Dean

In his play “Romeo and Juliet” William Shakespeare advanced the proposition through his character Juliet: “What’s in a name? That which we call a rose by any other name would smell as sweet.” What he was saying was that the flower, the rose, had intrinsic value, and, no matter what name it was given, that intrinsic value would be unaffected. The actual name, per se, was thus irrelevant and had little or no value. That proposition may have had some merit in the seventeenth century and in the specific context in which it was advanced, but it does not have universal application at the present time.

Names in the form of trade marks or the appellations of people, institutions, places, countries and the like have great economic, and other, value in modern society. Names can be symbolic of the characteristics and natures of the subject matter to which they are applied. Above all, they perform the function of embodying or encapsulating the reputation of that subject matter or the public esteem in which it is held.

In trade mark law the reputation attaching to a particular product, as symbolised by the trade mark applied to it and by which it is identified, can give rise to proprietary rights in that trade mark. A trade mark can be an extremely valuable item of property and an asset in the business in which it is used. One thinks of trade marks such as GOOGLE, MICROSOFT, APPLE, COCA COLA, MCDONALDS, and GIVENCHY, to name but a few. These trade marks have been ascribed values of many millions of US dollars. A cola-flavoured beverage which may be identical in all respects to the cola-flavoured beverage called COCA COLA is likely to have limited market appeal or value compared to the COCA COLA product. The reason for this is the value that the trade mark or brand name COCA COLA enjoys through its repute. Unlike Shakespeare’s rose, the name by which it is called is not irrelevant or valueless. The contrary is true. Having acquired a good reputation, the trade mark in fact becomes the primary commercial commodity rather than the goods to which it is applied. The roles cast by Shakespeare in effect become reversed and the actual goods become less important, and relatively of lesser value. In order to address this modern situation, Shakespeare’s proposition should be adapted to read, something along the lines of: “That which we describe as a perfume, if called by the name GIVENCHY, would smell as sweet.”

The same considerations apply to the names of other subject matter, and, in particular, people. An individual can develop a reputation which is symbolised or encapsulated in his or her name. A certain value, including, but not limited to a monetary value, can be ascribed to an individual’s name, usually by virtue of public awareness of that name combined with noteworthy performances or achievements. One thinks of entertainment personalities and sports persons. Names like GARY PLAYER, ROGER FEDERER, and DAVID BECKHAM, have become household words. They even become trade marks and are applied to goods as brand names or by way of endorsements. Such names can become vis a vis the goods that they identify what COCA COLA has become to soft drinks and APPLE to computers and smart phones. Here the names applied to the goods also become the primary sought-after commodity rather than the goods in question.

A good example of the name of an individual that has acquired a substantial reputation and become exceptionally valuable in monetary terms, virtually instantaneously, is that of the athlete Wayde Van Niekerk. By virtue of his superlative performance in winning the gold medal in the 400 metres athletics track event at the Olympic Games in Rio de Janeiro, and breaking the world record for that event, he has become famous. He has reportedly entered into an endorsement/sponsorship arrangement in respect of his name worth $ 30 million per year for life with the owners of the NIKE trade mark for sports goods. In a sense it took less than three-quarters of a minute to catapult his name to lucrative fame.

The law acknowledges that a person’s name and the reputation that it enjoys can be a substantial asset and it provides mechanisms for its protection. The individual has the right, firstly, to preserve his/her good name and, secondly, to control its use for commercial purposes. This is achieved by, respectively, personality rights under the common law and trade mark rights under trade mark law, both statutory and common law.

A name or a mark as a valuable asset is, generally, not something that comes about by happenstance. The name must have a good reputation, no matter how that has come about. In the case of Wayde Van Niekerk it came about suddenly, through winning an important race in record time. On the other hand, that race was preceded by long hours of training and by dedication aimed at achieving optimum performance. Wayde Van Niekerk is exceptional. In general, a reputation in a name is generated over a lengthy period by dint of a blend of painstaking work and effort together with talent and public appeal.

The policy of the law is to grant recognition and just deserts to a name that has a reputation, and to nurture and protect it as a fundamental right. The counterpoint to this is that the public at large has an obligation to respect that right and to honour it. This obligation is, however, subject to the holder of the name maintaining that good reputation.

A good reputation is a very powerful, but fragile, asset. It is vulnerable to being terminated at short notice. It is a paradox that the stronger the asset is, the more fragile it can be. Phrases such as “how the mighty have fallen” and “the tallest trees catch the most wind” spring to mind. The best and strongest reputation can be destroyed in and instant, even quicker than the three-quarters of a minute that it took for Wayde Van Niekerk’s instantaneous reputation to be created. The world-renowned paraplegic athlete Oscar Pistorious’ enviable and lucrative reputation was destroyed as the result of a single incident – in the time that it took to fire four gunshots; probably in as many seconds. The enviable reputation of Maria Sharapova, the famous tennis player, was severely, if not terminally, damaged overnight when she was found to have been using banned performance-enhancing substances. Other examples that come to mind are the fates that befell the cyclist Lance Armstrong and the golfer Tiger Woods, both of whose reputations were destroyed or severely dented by untoward incidents. In all these instances lucrative sponsorship/endorsement arrangements were terminated as a result of the reputation-destroying incidents that occurred. Famous trade marks can suffer similar fates, although may be somewhat more robust than individual names. The disastrous oil spill in the Gulf of Mexico suffered by BP oil and the fraudulent gas emission claims made by the manufacturers of famous-brand motor cars are examples.

In view of the cataclysmic damage or prejudice that can be caused to famous trade marks and name holders following on from potentially reputation-destroying incidents, it is important that the relevant facts pertaining to those incidents should be properly established before the incidents are publicised. For instance, to take the example of Maria Sharapova, suppose that the presence of the banned substance in her blood stream had subsequently been shown to have come about as a result of a bitter competitor slipping the banned substance surreptitiously into her drink at a cocktail party; it would have been grossly unfair and unjust to her for her reputation to have been sullied as a result of finding the presence of the substance in her blood stream in these circumstances.

What actually causes the tarnishment in this situation is the publicity given by the media to the potentially damage-causing incident. The media, thus, has, or ought to have, an enormous responsibility not to shout the incident from the rooftops unless and until all the relevant facts have been obtained. As mentioned above, the world at large, especially the media, have an obligation to honour and respect the rights of the holder of a reputation in a name or mark. That obligation is abrogated by giving prominence to untested stories or distorted facts. On the other hand, the media has the function of keeping the public informed. These two duties must be weighed up against each other. The balanced and honourable approach would be to report in a sober manner that allegations have been made about an incident and to add that the facts have not been established, and that it would be premature to reach any conclusions or form any judgment about the incident until certainty has been achieved. Unfortunately, past experience has shown that this approach is not the norm and the media frequently opts to sensationalise these matters to extreme extents, which, in turn, can spawn public hysteria. When this occurs, even the subsequent emergence of the true facts which show the name holder to be blameless can have little effect. The damage to the reputation has been done and cannot be undone.

The law is mindful of the vulnerability of trade marks and names to unjust tarnishment and its damaging consequences, and provides victims with remedies to obviate and compensate invasions of the rights of holders in this respect. Trade mark infringement and defamation claims, respectively, are available to aggrieved holders. However, these remedies are, generally, far too slow moving in the current digital age, and by the time that they can take effect the real damage has already been irretrievably done. What these remedies demonstrate, however, is that it is public policy that reputations of names and marks should be safeguarded against unfair and unjust tarnishment. The media and the public at large should be mindful of this public policy and must govern their conduct accordingly. This is the honourable attitude and the norm that citizens are expected to observe. Due respect for personal rights is enshrined in our Constitution.

A drama along the lines related above is currently being enacted in the case of Judge Mabel Jansen. It has been claimed that she has made various offensive remarks of a racialist nature. She, on the other hand, says that the remarks in question have been taken out of context and that, when viewed in their proper context, are not offensive as claimed. The matter has been referred to the Judicial Services Commission (JSC) for a thorough investigation. The true facts from which reasonable conclusions can be drawn ought to emerge from the deliberations of the JSC. This is the correct and proper course to follow. In the meantime, however, the media and members of the public have tried her before the court of public opinion and, without the benefit of being possessed of the complete and true facts, have found her guilty, and have hung drawn and quartered her. Her reputation is in tatters, whatever the outcome of the proceedings before the JSC might be. Her name, which has been worthy in legal circles, has been destroyed. This is grossly unfair and unjust, and is a blight on the conduct of those who inform public opinion. It has, moreover, led to her being vilified and to her and members of her family being physically threatened. What if she is found to be blameless? “A plague on both your houses!”, to quote Shakespeare, once again, from “Romeo and Juliet”.

An interesting aspect of this matter is the role played by her accuser, an activist in the cause of combatting rape of women and children. This role has facilitated this matter becoming an extreme example of reputation assassination. She appears to feel that Judge Jansen has sinned and should be made to answer for it. She is fully entitled to her point of view and even to raise the matter formally in the appropriate circles. By doing this she will have done sufficient to discharge her duty, as she perceives it. But has it been necessary, or even justified, for her to whip up the issue into a media feeding frenzy, particularly at this premature stage, as she has done? She has persistently kept the public controversy on this issue going over a period of several months. It is difficult to reconcile this approach with the acceptable norms that we have referred to above and with the cause of combatting rape that she espouses, and which Judge Jansen was supporting.

The position is aptly summed up by the immortal bard in “Othello” as follows: “But he that filches from me my good name robs me of that which not enriches him, and makes me poorer indeed.”

So, you may ask: “What’s in a name?” A whole lot!

Prof Owen Dean

Emeritus Professor and Research Fellow

Summary: While the Department of Trade and Industry’s recently published Intellectual Property Consultative Framework promises that future legislation will be the result of a thorough examination of the matters of concern by experts, and stakeholders, in the field, it should also consider undoing the potential damage which may have already been done to our intellectual property laws as a result of the failure to proceed with such rigour in the recent past.

To read the IP Chair’s full review of the IP Consultative Framework click here.

THIS EVENT IS NOW CLOSED

Watch the video of the lecture below.

The Chair of Intellectual Property Law presents the annual IP Law Public Lecture 2016 with Charles Webster, partner at Spoor & Fisher and frequent contributor to the intellectual property law programmes (LLM, PGDip and Short Course) at Stellenbosch University.

Charles’ lecture on Comparative Brand Advertising: the legal do’s and don’ts promises to be of significant value to all trade mark practitioners and brand managers and indeed everyone with an interest in promoting their goods or services in a competitive environment.

Charles’ wide experience at the upper echelon of corporate and commercial trade mark litigation makes this a must attend event.

Everyone is welcome to attend the lecture and the cocktail reception to follow. Attendance is FREE to all who RSVP.

Date:

25 August 2016

Time:

18:00 for 18:30 (refreshments from 18:00)

Venue:

Stellenbosch University, Faculty of Law

JC de Wet Hall

Ou Hoofgebou Room 1023

Corner of Victoria & Ryneveld Street

Stellenbosch

Click here for directions.

Entry:

FREE

Attire:

Smart casual

RSVP:

By 20 August 2016

Email – annettev@sun.ac.za

Tel – 021 808 9371 (08:00 – 14:00)

To download the invitation click here.

About the speaker:

Experience
30 years

Fields of practice
Charles specialises in litigation, in particular trade mark and copyright infringement, passing off, unlawful competition, Advertising Standards Authority complaints, company name objections, and domain name disputes. Charles has extensive experience in all facets and aspects of IP matters; he acts and is a consultant for a number of local and internationally-listed blue-chip companies.

Industry associations
Past President of the South African Institute of Intellectual Property Law.
Fellow of the South African Institute of Intellectual Property Law.
Member of the International Trademark Association (INTA).

Professional activities
Co-author of the 4th edition of Webster and Page South African Law of Trade Marks; Volume 4 of Trade Marks in the Law of South Africa. Charles sits on the Editorial Board of Trademark Reporter (INTA). He has lectured on both Trade Mark Law and Copyright for the Patent Examination Board.

Market Recognition
Listed in the WTR 1000 as one of the World’s Leading Trade Mark Professionals in 2014 – 2016.
Listed in the 2011, 2012, 2013, 2014 and 2016 Who’s Who Legal Trademark editions.
Listed as a key individual in the Chambers Global 2011, 2012 and 2016 Band 1 Law Firm Intellectual Property Law Firm – South Africa.
Listed as a key individual in the Legal 500 2011 and 2016 Top Tier Firm.
Best Lawyers listed Charles as a ‘Best Lawyer’ in Intellectual Property Law in South Africa 2009 – 2016.
Charles is listed in World IP Review Leaders 2016 – Best IP Practitioners.
Listed in the Managing Intellectual Property IP Stars 2015 and 2016.
Charles is listed as one of the World’s Leading Practitioners in Euromoney’s Expert Guides – Trade Mark 2016.

The recent decision involving Moneyweb and Media24 (Moneyweb (Pty) Limited v Media 24 Limited & Another [2016] ZAGPJHC 81) (full text available here) is an important one for copyright lawyers in South Africa because it is the first time that two provisions relating to news reporting of the Copyright Act 1978 (the Act) have been judicially considered, namely, sections 12(1)(c)(i) and 12(8)(a). In fact, it is the first time that the application of the fair-dealing provision, section 12(1), has received any judicial consideration, whether in the context of news reporting or otherwise.

Facts

The facts of the case were fairly straight-forward. The applicant (“Moneyweb”) and the first respondent (“Media24”) were (and still are) competing, online publishers of financial news. Moneyweb claimed that the publication of seven articles by Media24 amounted to copyright infringement of previous articles which Moneyweb had published, alternatively, that such publication constituted unlawful competition. There were, thus, in effect seven separate claims for copyright infringement of literary works. Accordingly, the court had to determine the following: whether Moneyweb’s previously-published articles were protected by copyright (i.e., were original); whether Media24’s articles reproduced a substantial part of the corresponding Moneyweb article (in light of the statutory exclusion in section 12(8)(a) of the Act), and, therefore, prima facie infringed Moneyweb’s copyright in its previously-published articles; and, if there was prima facie infringement, whether Media24 had any statutory defences pursuant to sections 12(1)(c)(i).

Originality

The court repeated the well-accepted legal position about when a work can be said to be original, namely, if its creation involved the expenditure of time and intellectual effort on the part of its author, and the result was not the production of a slavish copy of another’s work. A news article would be original to the extent that it consisted of more than just a slavish copy of the transcription of an interview with a person of interest, which would be the case where the author applied his mind to extracting salient quotes, incorporating some background, and providing his own views or observations.

Although the creation of an original work may incorporate existing material, the court held that a press article that was largely a copy of existing material, the transcription of a press statement, a press release (or statement) or presentation to (or conference call with) the media (with trivial or insubstantial differences) will not be original. The court held that four of the articles Moneyweb relied upon lacked originality as there was insufficient evidence of what the nature and extent of the particular author’s contribution was to the particular published article. A mere assertion on the part of the author that he or she expended significant skill and labour in producing a news report was insufficient to make a finding that it was original. In relation to these articles, the court, thus, did not have to consider the allegations of copyright infringement.

Although news articles may qualify for copyright protection, by virtue of being original, the scope of protection which they enjoy may be narrower than other literary works as a consequence of sections 12(1)(c)(i) and 12(8)(a) of the Act.

Items of press information

Pursuant to section 12(8)(a), “items of press information” are not be protected by copyright. This will include all information communicated to the press by persons in the knowledge that it will be put into the public domain and would include information disclosed at press conferences, press statements, and information provided to the media on request or by way of interviews. Thus, in determining whether a substantial part of a news article has been copied, any items of press information have to be discounted.

Moreover, the copyright protection which a news article may enjoy is subject to the fair-dealing exception provided for in section 12(1)(c)(i) of the Act. However, the fair dealing provision, section 12(1), acts as a defence to a claim of copyright infringement, and only applies if there has been a reproduction of a substantial part of a copyright work.

Reproduction of a substantial part

The assessment of whether a substantial part of a copyright work has been reproduced involves a value judgement based on the work as a whole, determined qualitatively, rather than quantitatively. In the case, the court held that a substantial portion of two of (the remaining three) Moneyweb articles had not been copied in the corresponding Media24 articles. In relation to the one article, the court held that only a small portion was copied: five paragraphs from a much longer article were copied. The headline and introductory paragraphs (which included some of the five paragraphs) did not constitute a substantial portion. Media24’s later article also did not deal with the same topic. In the case of the second article, the court held that the portions taken were not substantial as they did not summarise: the interview conducted by Moneyweb for its article, or the portion of Moneyweb’s earlier article which dealt with the topic of Media24’s later article. Thus, in relation to these two articles, Moneyweb failed in its claim for copyright infringement.

The remaining Moneyweb article was copied verbatim, and the court, therefore, concluded that Media24 reproduced a substantial part thereof. This, of course, meant that the court had to consider the possible defence pursuant to the fair-dealing exception provided for in section 12(1)(c)(i) of the Act.

Fair-dealing exception

There are three key aspects which a party has to establish if it wishes to rely on section 12(1)(c)(i): the purpose of the use must be to report current events; the use must be “fair”; and, there has to be the necessary attribution. The phrase “reporting current events” must be given its ordinary, wide meaning. Any event that is relatively close in time will qualify. It need not be an event that has occurred on the day of the report.

Whether use is fair involves a value judgment; it is a matter of fact, degree and impression. The factors relevant to a consideration of fairness for purposes of reporting current events include: the nature of the medium in which the works have been published; whether the original work has already been published; the time lapse between the publication of the two works; the amount (quality and quantity) of the work that has been taken; and the extent of the acknowledgement given to the original work. In the particular case, the factors which led the court to find that Media24’s use of Moneyweb’s article was not fair were the following: the Media24 article was published within seven hours, and on the same day as Moneyweb’s article; the Media24 reproduced Moneyweb’s article verbatim, and did not have much additional material; and, the Media24 article was likely to be a substitute for the Moneyweb article.

As for the required attribution, in the context of online publications, the use of a hyperlink to the copyright work is the most effective way of informing the reader of the identity of the author, and satisfies the statutory attribution requirement. It is not necessary that the names of the authors of the copyright work be mentioned in the other article which incorporated a substantial part thereof.

Unlawful competition

For works which are protectable by copyright, the courts will be reluctant to find that conduct amounts to unlawful competition where that conduct does not amount to copyright infringement i.e., where a copyright work has lawfully been used. Accordingly, unlawful competition had not been established.

Conclusion

It is, of course, the case that the determination of whether a work is original, or whether a substantial part of a copyright work has been reproduced, involve value judgements, by the court. However, the fact that the court considered four of the seven Moneyweb articles as lacking originality (and, therefore, ineligible for copyright protection) does come as a surprise, particularly given the length of each article. It is not clear whether the court has established a higher test for originality than the traditional “sweat of the brow” approach. Having said that, the court’s assessment was influenced by the fact that Moneyweb had not adduced sufficient evidence indicating the effort involved in the writing of those articles. Moneyweb, to its detriment, probably assumed that the court would take it on face value (or take judicial notice) that writing a news report involves the requisite, substantial (or non-trivial) effort for copyright protection. The case is a valuable lesson in making out a proper case for originality, rather than simply claiming that the work relied upon is original.

The manner in which section 12(8) is meant to operate is not clear. First, the judgment suggests that a news report is not protected by copyright to the extent that it contains “items of press information” but that the remaining portion could still be eligible for copyright protection i.e., could still be original. In other words, there is no indication that the mere presence of “items of press information” will exclude the work from copyright protection. Second, the court does not expressly state whether “items of press information” should already be discounted when determining whether a work is original, or only when determining whether a substantial portion has been copied. Given the order in which the court proceeded with its analysis, it appears that “items of press information” were in fact discounted in its determination of whether the news articles were original.

At last we now have some guidance in relation to the fair-dealing exceptions concerning news reporting, namely, section 12(1)(c)(i). It is clear that wholesale copying of a news article will, generally, not be permissible. Also, news aggregation per se does not amount to copyright infringement. The approach is generally consistent with the interpretation of the equivalent provisions under English law.

Prof Sadulla Karjiker

The meeting of the International Trade Mark Association (INTA) on 1 and 2 September 2016 will be the first meeting of INTA in Africa in 20 years.

The conference is set to be significantly important, with the theme Building Africa With Brands. The preceding INTA–BASCAP Workshop on 31 August will be on the topic: Intermediaries and Rights Holders—Working Together to Stop Counterfeiting and Piracy.

The impressive list of speakers include the founder of the Chair of IP Law, Prof Owen Dean, who will address the conference on Traditional Knowledge, Legacy Rights and Geographical Indications.

INTA offers a discounted rate to student and professorial attendees.

More details:

Conference click here.

Workshop click here.

We celebrate World Intellectual Property Day 2016 on 26 April with an interactive Q&A session with students, creators, innovators, legal and commercialisation experts to discuss how to turn valuable ideas into career opportunities and commercial assets.

You are invited to join the discussion at 13:00 on 26 April in the Ou Hoofgebou. Entry and refreshments are free.

Please RSVP by email to annettev@sun.ac.za. See the invitation below for more detail.

The session is presented by the Anton Mostert Chair of Intellectual Property Law at the Faculty of Law, in partnership with Innovus and Von Seidels.

1 Introduction

Despite there being no internationally-accepted agreement on the mechanism for protecting indigenous (or traditional) knowledge, or indigenous (or traditional) cultural expressions, the South African government appears to be determined to introduce some form of protection in this area. To that end, the Department of Science and Technology (“DST”) published the latest draft of the Protection, Promotion, Development and Management of Indigenous Knowledge Systems Bill (the “2016 IKS Bill) on 8 April 2016 (GG 39910).[1] This follows its first draft Bill which was published last year (the “2015 IKS Bill).[2] This article will highlight what appears to be a fundamental change in the scope of application of the 2016 IKS Bill, when compared to the 2015 IKS Bill, and some of the substantive issues which remain in the Bill.

2 IPLA Act trumps IKS Bill

As previously indicated at the time of the publication the 2015 IKS Bill, the merit of the approach embodied in the DST’s IKS Bills is that it proceeds from the correct theoretical basis in relation to indigenous knowledge: it seeks to provide special (sui generis) protection for indigenous knowledge. In other words, it does not seek to protect indigenous knowledge in terms of the recognised types of intellectual property, such as, patents, copyright, designs or trademarks, because it does not conform to such types of property. While that singular fact meant that the DST’s approach should be preferred over that embodied in the Intellectual Property Laws Amendment Act, 2013 (the “IPLA Act”), the 2016 IKS Bill appears to represent a rather serious dilution of the approach embodied in the 2015 IKS Bill.

The 2015 IKS Bill, despite its technical-drafting problems, purported to comprehensively deal with the protection of indigenous (or traditional) knowledge (“IK”), and indigenous (or traditional) cultural expressions (“TCEs”), by way of sui generis protection.[3] That appears to no longer be the case. The 2016 IKS Bill still contains a definition of “indigenous cultural expressions”, but, arguably, it may no longer be the exclusive source of substantive protection of TCEs. First, it is important to note that although clauses 2(2) and 9 of the 2016 IKS Bill prima facie only apply to “indigenous knowledge”, the definition of “indigenous knowledge” now includes “indigenous cultural expressions”. In contrast, the substantive provisions of the 2015 IKS expressly listed “indigenous knowledge” and “indigenous cultural expressions” as separate protected subject matter, and did not subsume the latter into the definition of the former. Second, and more importantly, the concern is that TCEs, unlike other “indigenous knowledge”, will no longer exclusively be the subject of the sui generis protection crafted by the IKS Bill.

Given the fact that the 2015 IKS Bill purported to be represent a concerted attempt to comprehensively deal with the protection of IK, and TCEs, it was hoped – at least by those concerned about maintaining the integrity of our intellectual property laws – that the proposed IKS Bill would result in the repeal of the IPLA Act, or, at a minimum, that it would never be brought into effect. On the face of it, the 2016 IKS Bill seems to envisage that the IPLA Act – despite its fundamentally-flawed approach – may no longer have the ignominious ending it deserves. The reason for the scepticism is that clause 32 of the 2016 IKS Bill states that the provisions of the Bill will, in effect, be trumped by any rights conferred by another statute concerning intellectual property. But for the IPLA Act, clause 32 would not have been concern it is.

The IPLA Act specifically deals with TCEs, and not IK. As has previously been pointed out, the IPLA Act was, and remains, an ill-considered attempt at protecting TCEs that is out of kilter with the majority view of experts in the field of intellectual property law, both locally and internationally. It is a Procrustean attempt to force the protection of TCEs into the existing intellectual-property framework, despite the fact that TCEs do not conform to the requirements of the existing forms of intellectual property. The problem, however, is that, as the IPLA Act seeks to protect TCEs as intellectual property, clause 32 of the 2016 IKS Bill would mean that, in the event of a conflict between the provisions of the IPLA Act and the Bill, the provisions of the IPLA Act will prevail.

Thus, the inclusion of clause 32 in the 2016 IKS Bill represents, either intentionally or as a result of oversight, an undermining of the most praiseworthy aspect of the DST’s efforts in seeking to protect IKs and TKEs, namely, its theoretically-correct approach in promoting sui generis protection. If the IPLA Act is not repealed, it will do more than cast a dark shadow over intellectual property law, it will also potentially undermine what the IKS Bill laudably sought to achieve. In addition to the repeal of the IPLA Act, it would be advisable to provide that subject matter which is protectable by recognised intellectual property rights (or the common law) should not also be protected under the IKS Bill. After all, this type of protection is said to be required because the recognised types of intellectual property or the common law, do not protect IKs and TCEs.

3 Other substantive issues

For what it is worth, here is a selection of some other substantive issues which should ideally be addressed before the Bill is enacted. First, it remains unclear whether protection is dependent on registration. Clause 33 gives IK holders 12 months to seek registration of their IK, but there is no indication if registration is a condition for protection. This was a shortcoming that we pointed out in relation to the 2015 IKS Bill, as well. Protection based on a registration system for IK would certainly be preferable, given the uncertainty about what will be protected and the precise scope of such protection. Second, the Bill does not appear to adequately deal with the rights of persons who, hitherto, have used IK or TKE. Third, clauses 13(5) and 28(1) introduce a preposterous concept that can only be described as “criminal contractual breach”. The proposed sections provide that the failure to use indigenous knowledge in the manner provide for in a licence issued for the use of indigenous knowledge is a criminal offence. Fourth, if the protection is not based on a registration system, it will be highly problematic to require a potential user to know when a licence is required (see clause 13(2)). This is particularly the case because the Bill appears to provide for a system of no-fault liability. The problem appears to be compounded by the seemingly unnecessary secrecy relating to the documents lodged in connection with the registration of IK (see clause 21(2)), and the fact that independent creation is not exempted.

4 Conclusion

While the 2016 IKS Bill now contains fewer drafting issues, when compared to the 2015 IKS Bill, one cannot help but get the impression that the quality of drafting still leaves much to be desired. It appears that the DST has wavered in its commitment to provide a theoretically-principled approach to the protection of IK and TCEs. The 2016 IKS Bill, by not providing for the repeal of the IPLA Act (and potentially allowing its provisions to override the IKS Bill), will potentially damage the principled approach which the DST had appeared to follow in pursuing sui generis protection for IK and TKE. Moreover, we should remind ourselves, that by continuing to plough this lonely furrow, it is only South Africans that will be restrained from using domestic IKs and TCEs, if the IKS Bill is enacted. Persons elsewhere will continue to have unfettered freedom to use IKs or TCEs originating in South Africa. So much for encouraging global competitiveness.

Prof Sadulla Karjiker

___

[1] The legislative process in South Africa still appears to be worryingly chaotic. There are actually two versions of the 2016 IKS Bill in circulation. While the version published in the mentioned Government Gazette should, theoretically, be the official version, the version circulated to the press actually appears to be a later version. It is the latter version of the Bill (B6-2016) that forms the basis of this article, and not the version in the Government Gazette (B-2015), which also does have the Memorandum attached version B6-2016.

[2] GN 243, GG 38574 of 20 March 2015.

[3] See, for example, clauses 10, 11 and 12 of the 2015 IKS Bill.

CIP – The Anton Mostert Chair of Intellectual Property

1 Introduction

2 Definitions

3 Proposed amendment to section 3

4 Proposed new section 3A

5 Proposed new section 3B

6 Proposed amendment to section 5

7 Proposed amendment to section 8

8 Proposed sections 8A and 8B

9 Other issues

10 Conclusion

THIS EVENT IS NOW CLOSED

Facts

Originality

Items of press information

Reproduction of a substantial part

Fair-dealing exception

Unlawful competition

Conclusion

1 Introduction

2 IPLA Act trumps IKS Bill

3 Other substantive issues

4 Conclusion

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