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Computer Law Special

Jan 2009

Jane Lambert 
Jane Lambert is a barrister specializing in intellectual property and technology, media and telecommunications law. She is also a mediator and arbitrator sitting on the WIPO arbitration, mediation and domain name panels.

She learned her IT law as in-house legal advisor to VISA International for Europe, the Middle East and Africa in the early 80s, longt before there were IT lawyers as such. "Practically the only book on computer law on the British market was Colin Tapper's "Conmputer Law" and he took pains in the preface to justify it as opposed to books on say tuning forks" notes Jane.   "Nobody was offering courses or pupillages so I had to teach myself."

Jane was in many of the early computer supply and software copyright disputes. She drafted hardware, turnkey, software development, maintenance, outsourcing, end user licence and escrow agreements from first principles.   She contributed some of  her pleadings to Atkin and some of her precedents to the Encyclopedia of Forms and Precedents.

Jane set up the Northern Branch of the Society for Computers and Law in 1985 which was the first branch of the Society and chaired it for for 4 years serving on its national Council. She also served on the NCC's Legal Panel for as long sd it was in existence.

Contents

Meet the Editor

"Software Patents after Symbian and Bilski" application form

Computer Supply Contracts: All in the Specification

Disputes Between Parties in Different EU Member States

Dispute Resolution Clauses

Other Upcoming Seminars

"Making Your Mark": workshop on branding including the new generic top level domain names Halifax 11 Feb 2009

Mediating IP Disputes
Wirral, 25 Feb 2009

Dear {First_Name},

How does a developer protect its investment in innovative and marketable software?

Copyright protects code, screen and print output and the configuration of software components from being copied. The law of confidence protects the algorithms, code and comments contained in a program's source code from unauthorized use or disclosure. The difficulty is that neither copyright nor confidence can prevent a competitor from developing an application with similar features and functions.  

The most far reaching protection for a new product or process would be a patent. Unfirtunately, both the European Patent Convention and the Patents Act 1977 exclude programs for computers as such from the definition of invention. There are also similar exclusions for schemes, rules or methods for performing mental acts, playing games, doing business or presenting information.  

The US patents statute has never contained such exclusions. Consequently, many patents have been granted in the USA for software and business method inventions.   Some in the software and financial services industries believe that that has placed British companies at a competitive disadvantage.

In October 2008 appellate courts in England and the USA delivered important decisions on software patents.   In Symbian Ltd. v The Comptroller the Court of Appeal held that at least some software implemented inventions are patentable. In Bilski  the Federal Circuit applied a two prong test for patentability not too far removed from the Court of Appeal's approach in Symbian (see my note "Software Protection after Symbian and Bilski" with links to those cases).

Those two decisions have done much to level the playing field between the US and European software industries and present opportunities for British developers.    Their significance has been over-shadowed by the cascade of bad news since October but this good news may eventually prove to be just as significant as the bad.

To explore those opportunities I have organized a half day conference in Liverpool for the 5 Feb 2009.   I will set the scene taking everybody through the European, British and US legislation and case law, the ill fated European software directive, the decisions in Symbian and Bilski and subsequent cases such as Re January Patents Ltd.'s applicationin the UK.   I will be followed by Julyan Elbro of the IP Office who will talk about the Office's policy on software and business method patents.   Patent attorney Robin Bartle will talk about filing software and business method patent applications in the IPO, EPO, USPTO and other patent offices. Finally, Philip Gray of Kirwans will talk about alternatives to patenting such as copyright and confidentiality.

Thanks to Kirwans' generous sponsorship I can offer this seminar for £25 + VAT.    You can book your place immediately on-line or tear off the form below and post it to me with your cheque. Either, way I must have your application and payment by 17:00 on 31 Jan 2009.

Yours sincerely,

Jane Lambert

www.nipclaw.com

Software Patents Conference

logo.jpg 

  Martins Building, Water Street, Liverpool, L2 3SX

  5 Feb 2009 14:00 - 17:00 (CPD Points 2½ hours SRA)

Please reserve me .... places for the above seminar at the rate of £28.75 per person. I enclose my cheque for £...............

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Please make out your cheque to NIPC Ltd and send it to NIPC Ltd., the Media Centre, 7 Northumberland Street, Huddersfield, HD1 1RL, Tel 0870 990 5081.

NIPC Ltd.is a private company incorporated with limited liability in England and Wales under the provisions of the Companies Acts 1985 – 2006 with company number 06223818. Its registered office is c/o HWCA Ltd., Northern Assurance Buildings, 9-21, Princess Street, Manchester, M2 4DN. Its principal place of business is The Media Centre, 7 Northumberland Street, Huddersfield, HD1 1RL, Tel +44 (0)870 990 5081.  The company's VAT number is 929 5910 

Computer Supply Contracts: All in the Specification

Nearly all the computer supply disputes that I have seen over the last 25 years have fallen into two categories:

  • Disputes over what the supplier's salesmen and literature promised compared to what the contract provided; and
  • Disputes as to whether the supplier has delivered what it has promised.

As often as not disputes of the first kind tend to turn on the validity of exceptions and limitation clauses. Judges and arbitrators tend not to be very sympathetic to suppliers in those cases.   Disputes of the second kind tend to turn on what the construction of the contract. Where there is a clear specification then all well and good. Where there is not, a lot of time and money is spent on trawling through emails and correspondence.

The key to avoiding both kinds of disputes is to get the specification right. The techies should work out exactly what they want from the system long before lawyers start drafting. They should also agree objective tests for determining whether the specification has been complied with. A good draftsman or woman will centre the contract around the specification. The contract should require the customer to accept the deliverables when, and only when, it is clear that the specification has been complied with. Acceptance will then trigger payment.


Disputes Between Parties in Different EC Member States   

When a German customer refuses to pay its British software house on the grounds that the software does not meet its requirements, does the British company have to instruct German lawyers to plead its case in German? If a Polish website offers infringing copies of  UK software to UK customers, can the English company sue in England or must it go to Warsaw or Krakow?

Questions of this kind are known as "conflicts of law". They were said to hamper the development of a single European market because each EC member state's conflict rules are different. To address that problem, the European Council and Parliament have adopted regulations that determine which law is to apply and which court is to resolve a dispute between parties in different member states.

Those regulations are known as Rome I and Rome II respectively:

  • Rome I provides rules for determining the laws to be applied for determining contractual disputes and comes into force on 17 Dec 2009 in respect of contracts made after that date;
  • Rome II provides rules for determining intellectual property infringement, passing off and other non-contractual disputes and came into force on 11 Jan 2009.

We shall no doubt revisit both regulations as and when they are considered by the courts.


Dispute Resolution Clauses  

There are three ways in which a dispute can be resolved:

  • the parties can go to court;
  • they can refer their dispute to arbitration; or
  • they can use some alternative method of dispute resolution.

If the dispute is very simple such as the recovery of the price of goods sold and delivered then the courts provide the best solution. But suppose there is a genuine dispute as to whether the supplier has delivered what it has promised. A busy district judge can't decide that question. All he or she can do is give directions for trial before a judge who knows nothing about computers or perhaps transfer the case to the Technology and Construction Court where the judge may well know about computers but he or she also plenty of other cases.

In many instances, time and money can be saved either by referring technical disputes to arbitration or expert determination.   If you want to do that you will need a dispute resolution agreement, either at the time the dispute arises or when the contract is negotiated.   Below is an example of the sort of clause we recommend for parties who want to refer disputes to us for arbitration:

"(1)   Unless the context requires some other meaning:

"the Arbitration" means an arbitration pursuant to sub-clause (2);

"the Arbitrator" means an arbitrator appointed in accordance with these provisions;

"Claimant" means a party serving an Invitation;

"the Company" means NIPC Ltd. a private company incorporated with limited liability in England and Wales having its registered office at HWCA Ltd., Northern Assurance Buildings, 9-21 Princess Street, Manchester, M2 4DN;

"Invitation" means the notice to refer a dispute to arbitration pursuant to sub-clause (3).

"the Panel" means the panel maintained by the Company for the time being;

"the Respondent" means a party receiving the Invitation; and"the Rules" means the Company's Dispute Resolution  Rules.

(2) Any dispute or difference that may arise between the parties will be referred to arbitration before a single arbitrator.

(3) Arbitral proceedings will be commenced where one party serves notice upon another inviting it to refer the dispute to arbitration.

(4) The Invitation will nominate at least one member of the Panel as Arbitrator and will require the Respondent to accept such nomination in which case the nominee will be appointed..

(5) Should the parties be unable to agree the Arbitrator within [14] days, either party may ask the Company to appoint an Arbitrator.

(6) The Company will manage the Arbitration.

(7) The Rules will apply.

(8) The Arbitrator will apply the laws of England and Wales".

This can be combined with a mediation clause or a med-arb (mediation followed by arbitration) clause.

NIPC
The Media Centre
7 Northumberloand Street
Huddersfield
HD1 1RL
United Kingdom
Tel 0870 990 5081

NIPC IP/IT Update



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The Media Centre
7 Northumberland Street
Huddersfield, England HD1 1RL
UK

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