E-commerce and the Law Bond University Semester 113
Today’s session• Jamie White – About me• Pod Legal – About us• Context of today’s session• Overview of Intellectual Property (IP)• Securing IP Rights• Doing Business Online• Most Common Mistakes When Doing Business Online• Online Risk Management• Question Time
Jamie White: Who Am I?• Former Tennis Professional (1989-2000)• Bond Law Graduate (2005)• Intellectual Property/Technology Lawyer• Registered Trade Marks Attorney• Solicitor of High Court of Australia• Solicitor Director/Co-Owner, Pod Legal
Pod Legal: What We Do• Intellectual Property Law• Internet Law• Technology Law• Privacy Law• Franchising Law• Advertising and Marketing Law• Commercial Law
Our Points of Difference• Personal Service: delivered with enthusiasm and passion.• Leaders: We stay at the forefront of our industry.• Transparency: we charge on a fixed-fee basis, deliver value for money solutions and stick to our word, no matter what. We call this the ‘Pod Experience’
Context of today’s session • Electronic commerce • Social media • Publication of material online • Online communications • Online advertising and marketing • Doing any business online
Intellectual Property: OverviewWhat is Intellectual Property?• Represents the property of your mind or intellect.• In business, this means your proprietary knowledge – a valuable component of success in business today.• This is often the “edge” which sets successful companies apart from competitors.• As the marketplace becomes increasingly competitive, protecting your intellectual property is essential.
Intellectual Property (continued)Why is IP important to business?Every business will have some form of intellectual property. Examples: • a unique product or design; • manufacturing process; • innovative idea; • a distinctive name or logo; and • original documents.
Intellectual Property (continued)Why is IP important?• Businesses are becoming increasingly aggressive in gaining market share.• Businesses with a competitive edge stand out from the rest.• Building effective strategies around your IP will give a major, sustainable advantage.• Successful businesses place their IP alongside other assets on the balance sheet.
Intellectual Property (continued)Protection of IP• The most common types of IP are copyright, trademarks, patents, designs and trade secrets. • Today’s focus will be on copyright and trade marks.• IP laws enable owners, inventors, and creators to protect their intellectual property from unauthorised use.• IP is an asset that can be bought, sold or licensed.• What does an IP Lawyer typically do?
Copyright Protects the original expression of ideas, not the ideas themselves. Copyright automatically protects your original works of art and literature, music, films, sound recording, broadcasts and computer programs from copying and certain other uses. Not registrable in Australia (what about the U.S.?) Does not protect against the independent creation of similar works. Legal position (re: employees and contractors). Use of copyright notices.
Copyright (cont)Typical Business CopyrightExamples:• Business manuals and policies;• Images, photographs, artwork (E.g. PodToons);• Advertising copy, promotional literature, jingles;• Template agreements, precedents;• Websites/website content;• Computer code and documentation; and• Plans.
Trade MarksWhat is a trade mark? A trade mark may be a word, phrase, letter, number, scent, shape of an object, logo, picture, symbol, colour, aspect of packaging (get-up) or any combination of these. A trade mark is used to distinguish the goods and services of one trader from those of other traders. Trade Marks Act 1995 (Cth)
Trade Marks (cont)A trade mark cannot be: A sign which other traders are likely to wish to use in conjunction with their similar goods and services; A geographical name or common surname; Scandalous or its use contrary to law; Likely to deceive or cause confusion; or Substantially identical or deceptively similar to a prior trade mark application or registration in relation to the same, similar or closely related goods and services (unless prior use of the trade mark can be shown).
Trade Marks (cont)What is trade mark registration? Trade mark registration grants its owner the legal right to exclusively use or control the use of the trade mark for the goods or services for which it was registered. A registered trade mark can be protected against third party misuse or infringement. Only a registered trade mark can benefit from protection under the Trade Marks Act 1995 (Cth).
The Value of IP• Identify and record your IP;• Protect and defend;• Commercialise and add value to your IP;• Valuation of IP;• Balance sheet benefits; and• Mergers/acquisitions/IPOs.• See Business ‘Briefing Series, 20 issues on intellectual property’ (IP Aust/Institute of Chartered Accountants)
Trade Mark ApplicationsShould prospective trade marks be searched beforefiling an application?A comprehensive search of a prospective trade markshould be conducted prior to filing a trade markapplication. This may avoid substantial expenditure beingwasted on an unsuccessful application.
Trade Mark Applications (cont)A Trade Mark Search should be conducted to:• discover any prior registered trade marks that may be infringed by your proposed trade mark application;• discover whether any prior registrations or applications may prevent the registration of your proposed trade mark;• discover whether the proposed trade mark is likely to be successfully registered in Australia; and• assess the likelihood of any third party common law claims.
Trade Mark ApplicationsThe registration procedureStep 1:A trade mark application is lodged with IP Australia, theresponsible entity for the administration of trade marks inAustralia.
Trade Mark Applications (cont)The registration procedure (cont)Step 2:• Once lodged, a Priority Date & Application Number are allocated to the trade mark application.• The Priority Date is that date the trade mark is taken to be registered from, once the registration process has been completed.
Trade Mark Applications (cont)The registration procedure (cont)Step 3:• The application is then examined by an IP Australia Officer (the Examiner) who may raise objection if the proposed trade mark is non-distinctive, substantially identical or deceptively similar to a prior registered trade mark, or is a prohibited trade mark.• If the Examiner raises an objection, an adverse report will be issued. Opportunity will be given to you to respond to the report and alter the application as may be necessary.
Trade Mark Applications (cont)The registration procedure (cont)Step 4:• If there are no difficulties with the trade mark, or once the difficulties have been resolved, the trade mark will be accepted for registration.
Trade Mark Applications (cont)The registration procedure (cont)Step 5:• Upon acceptance for registration, the trade mark is advertised in the Official Journal of Trade Marks. From the day of publication, a three month opposition period commences whereby members of the public can oppose the registration of the mark on various grounds.
Trade Mark Applications (cont)The registration procedure (cont)Step 6:• Assuming no opposition is made during that period, the trade mark will be entered on to the trade mark register for a period of ten years upon payment of the registration fee.• Should opposition be made, opportunity is again given to respond in defence of the trade mark, at a Hearing with a Registrar.
Trade Mark Applications (cont)Use of the TM and ® symbols• You may use the ™ symbol prior to having your trade mark registered in Australia. By doing so, it indicates that you intend to use the trade mark in association with the goods or services to which it appears.• You may use the ® symbol prior to after your trade mark is registered. When using the ® symbol, all representations that you make in relation to the trade mark must be true.
Trade Mark Applications (cont)Completing a Trade Mark Application• Applicant name;• Applicant address;• Address for service;• Representation of trade mark;• Specification of class/es; and• Class description/s.
Trade Mark Applications (cont)Let’s have a crack! In pairs:• Create a brand.• Create a product/service.• Complete a trade mark application. • Applicant name, applicant address, address for service, representation of trade mark, specification of class/es and class description/s.
Trends• A clear shift toward Internet based systems of e- commerce…failure to complying with changing legal rules can be fatal to business.• Tendency to overlook legal issues in an electronic environment.• Consequence: legal risk.
Website ContentFour sources of website content: 1. Original material; 2. Assigned material (legally acquired); 3. Licensed material (consent); and 4. Stolen material (no consent).
Website ContentAreas of law relevant to online business include: • Consumer protection laws • Privacy Act • Spam Act • Copyright Act • Trade Marks Act • Contract law • Common law
Website ContentCompetition and Consumer Act• The object of the Competition and Consumer Act is to promote competition and fair trading and provide for consumer protection.• The most common breaches of the Competition and Consumer Act relate to conduct that is misleading or deceptive, or capable of misleading or deceiving.
Website ContentPrivacy Act• Website users have the right to know: • What information is being collected about them; • How that information will be used; • Who that information will be disclosed to; • How to verify the accuracy of that information; and • How to access that information.• Website users must be able to request that their personal information is no longer collected or distributed.
Website ContentSpam• Governed by the Spam Act 2003.• A person must not send, or cause to be sent, a commercial electronic message that; • has an Australian link; and • is not a designated commercial message.• Spam may comprise a single commercial electronic message.
Website Content Spam (cont)• Significant penalties apply: • 2006: 5.5 million dollars (email) • 2009: 15.75 million dollars (SMS)• The risk is real!
Website Content Copyright• Copyright is often infringed via the unauthorised use of text and images.• However, third parties may be liable too: • Cooper’s Case (MP3’s) • AFACT v iiNet (movie and music piracy)
Website ContentCopyright (con’t)• Ownership of copyright • The author of a work will be the first owner of copyright in that work. • Any exceptions?
Website ContentCopyright (cont)• Copyright in works can only be transferred via written assignment. • Verbal agreement to assign is not enough. • Consider ownership of photographs, logo design and website.
Website ContentTrade Marks Act Trade mark infringement takes place when one trader uses the trade mark of another trader creating the likelihood of confusion in the market place.
Website ContentTrade Marks Act (cont)Examples of possible trade mark infringement: • The display of a trade mark on a website linking to another website, falsely leading the website user to believe that an affiliation or association exists will be trade mark infringement • Domain names • Google AdWords • Meta-tags • Unauthorised display of logos
Website ContentPassing Off• Passing off is where one trader falsely passes off as having an association with another trader.• Usually used in relation to unregistered trade marks.• Usually asserted in conjunction with provisions of the Competition and Consumer Act.
Case StudyPatchett v SPATA (UK)• Facts: • SPATA (a trade org) made representations on its website about the financial stability of its members. • SPATA suggested on its website that an additional information pack should be considered. • Mr Patchett relied on the displayed information and contracted with a member pool builder. • Pool builder became insolvent. • Mr Patchett brought an action in negligence against SPATA.• Outcome?
Case Study (cont)Patchett v SPATA (UK)• Fortunately for SPATA, the Web site also included a suggestion that users of the Web site should consider the contents of an additional information pack.• The Court held that this operated as a disclaimer against the liability that would otherwise have arisen.• Warning!!
The Most Commonly Made Mistakes When Doing Business Online
The Facts• 39 per cent of businesses now have an online presence.• Tendency to overlook legal issues in the online environment.• Failure to comply with changing legal rules could be fatal to your business.
Mistake 1: Copyright infringement• What is copyright? – Copyright protects original expressions of ideas and not the ideas themselves.• What is copyright infringement? – Copyright infringement takes place where another party does an act which infringes the exclusive rights of a copyright owner.
Mistake 1: Copyright infringement• Examples of copyright infringement: – Unauthorised reproduction of text and images. – Unauthorised reproduction of website legal documents!• Solution: Use your own material or obtain a licence to use another person’s material.
Mistake 2: Trade Marks• What is a trade mark? – Sign, shape, symbol, label, letter, word, slogan, scent, sound, colour, aspect of packaging or a combination of any of these.• What is trade mark infringement? – Where a person uses a trade mark that is substantially identical with, or deceptively similar to, a trade mark owned by another person.
Mistake 2: Trade Marks• Examples of trade mark infringement: – Unauthorised display of third party logos. – Unauthorised use of a trade mark in a domain name or Google Adwords campaign.• Solution: Obtain consent to use a third party trade mark.• eBook: http://www.podlegal.com.au/downloads/eb ook-trademarks.pdf
Mistake 3: Deceptive Trade Practices• Consumer protection laws such as the Competition and Consumer Act.• Examples of deceptive trade practices: – False testimonials. – Leading consumers to believe that an association or affiliation with another trader exists when it doesn’t.• Solution: Don’t mislead or deceive!
Mistake 4: Breach of Privacy• When collecting information about a person, that person has a right to know: – that the information is being collected; – how the information will be stored; – how the information will be used; and – under what circumstances the information may be disclosed.
Mistake 5: Use of a Competitor’s TradeMark in your Google AdWords Campaign.
Mistake 5: Google AdWords• What are Google AdWords? – It’s a form of pay per click (PPC) advertising.• Using a competitor’s trade mark in your Google AdWords campaign may amount to: – misleading or deceptive conduct; – trade mark infringement; and/or – passing off.
Mistake 5: Google AdWords• Solution: Do not use a competitor’s trade mark in your pay per click advertising campaigns.• Article: http://www.podlegal.com.au/article- tm-google-adwords.php
Mistake 6: Violation of Spam Laws• What is spam? – An electronic message that contains an invitation to do business and that has been sent without the consent of a recipient.• Big penalties apply: – $5.5m in 2006 (213m emails) • Use of address harvesting software and no recipient consent. – $15m in 2009 (re SMS) • No recipient consent.
Mistake 6: Violation of Spam Laws• How to comply with the Spam Act: 1. Obtain recipient consent prior to sending; 2. Identify your business as the sender; and 3. Provide a functional unsubscribe facility.• Solution: Comply with the Spam Act.• Article: http://www.podlegal.com.au/article- spam.php
Mistake 7:Overlooking Legal Aspects of Social Media
Mistake 7: Social Media• Social media is just another medium for publishing information and communications.• Legal rules also apply to conduct relating to social media.• Examples of the hidden costs of social media: – Online defamation via Facebook (comments about a Policeman resulted in fines). – Journalist’s employment terminated for offensive tweets during Logies (re Bindy Irwin).
Mistake 7: Social Media• Solution: Don’t overlook legal issues associated with social media.• Articles: – http://www.podlegal.com.au/article-social-media- twits.php – http://www.podlegal.com.au/article-defamation- online.php – http://www.podlegal.com.au/article-facebook- promotions.php
Overall Solutions• The benefits of legal documentation: – Those engaging with you to do business online are made aware of laws and policy regarding your website and/or Facebook page. – Disputes resolved efficiently and favourably. – Liability associated with your website and/or Facebook page will be limited.
Take Action Now• To reduce legal risk associated with your online business practices, you should: – consult an Internet / IT Lawyer (not a Property or Family Lawyer) to review your online business practices; – ensure that you display legal documentation, specific to your online business practices; and – not assume that all will be ok because you are doing business in the online environment.
Take Action Now• Article: http://www.podlegal.com.au/article-online- business-risk.php• eBook: http://www.podlegal.com.au/downloads/ebook- your-website.pdf
Case StudiesLet’s pick on some random website owners.• What legal documents do they display?• Have they applied to register their trade marks?• Are they exposed to legal risk?• What now?
Question TimeSome past questions:• What’s it like to be a trainee lawyer?• To specialise or not specialise?• Expectations of a young lawyer?• Big firm or small firm?• What are the working hours like?• Traits of a good lawyer?• Remuneration?• The road to partnership?