KASS IP exposé - August 2015 by KASS | The IP Experts

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Made in Malaysia

AUGUST 2015 HIGHLIGHTS

BY ILANGKUMANAN KASHABAN

Made in Malaysia

“Merdeka!” rang the voice of freedom as the father of Malaysia, Tunku Abdul Rahman declared Malaysia's independence on 31st August 1957. It has been 58 years of independence since, and every year Merdeka Day is awaited by the nation to cherish moments of togetherness regardless of race, ethnicity and culture. Today, the country can stand tall in the eyes of the international business community due to its determination to become a knowledge-driven economy. Together, the R&D institutions, universities, government agencies and private sector in Malaysia have been working hard to spearhead this initiative, leading to increased rates of innovation and technology across the board.

Reaping Rewards from the Breeding of New Plant Varieties

Notably, Malaysia has shown high growth in the medical and healthcare industry. Several institutes in Malaysia have successfully obtained patents for numerous inventions in the fields of medical and healthcare science. In conjunction with our National Day, let’s take a look at some noteworthy ones:

Is IP Protection Still Relevant?

Universiti Malaya (UM), the oldest and one of the most esteemed institutes in Malaysia, continuously upholds its fame as a leading public research university in Malaysia, filing the highest number of patent applications in 2014 with 162 applications. This year, they have received a number of granted patents in Malaysia, one of them being Malaysian Patent No. MY-154109-A, entitled “A haemostatic agent delivery system.” Haemostatis is a physiological response by our body to prevent and/or stop bleeding (haemorrhage). The invention relates to a device that delivers haemostatic material to the site of the haemorrhage in order to prevent and/or stop bleeding.

The Burning Question – Who Owns the Polo Trademark?

University Putra Malaysia (UPM) is another local institution that is active in R&D, filing 49 patent applications last year. The university recently obtained a patent for a “Method for detecting and identifying candida species”, Malaysian

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Other Updates:  Happy Independence Day!

 Towards Creative Indonesians

INNOVATIONS DECIDE sm

IP exposé AUGUST ’15 Patent No. MY-153642-A, which relates to a method used to detect and identify the Candida species, a genus of yeast and most common cause of fungal infections in humans.

the medical and healthcare industry. MPOB has several patents in this area, one of which is Malaysian Patent No. MY-154376-A, titled “A transdermal fluid”. The patent discloses a transdermal fluid used for the prevention or treatment of a cancer and/or a tumour in mammals. The patent further explains that the same can also be used for prevention or treatment of inflammatory disorders in mammals. The transdermal fluid comprises of tocotrienols or derivatives of tocotrienols extracted from palm oil, which have potent anti-proliferative and pro-apoptotic effects associated with a decreased risk of cancer.

Universiti Sains Malaysia (USM), a research intensive university, has also contributed to the medical and healthcare field. Among their granted patents is Malaysian Patent No. MY-153035-A, entitled “A plant-based cancer chemopreventive agent”, which discloses the production of a cancer chemopreventive agent from a tropical plant, namely the Streblus species, that is capable of inhibiting the growth of cancer cells, particularly primary bone cancer cells and tongue cancer cells.

These are but a few examples of the results of R&D undertaken by our local institutions and agencies, made in Malaysia, by Malaysians, for the betterment of healthcare in the country (and the world). It makes me proud to be Malaysian, to see that such contributions of great impact to society are being made. One can only hope that enough is being done to ensure they realise their full potential. Once that is achieved, I strongly believe that these innovations will be an eye opener to the younger generations to challenge themselves intellectually for a better Malaysia and a better life. Happy Merdeka Day to all Malaysians. .end.

Apart from universities, agencies that conduct extensive research activities like the Malaysian Palm Oil Board (MPOB) have also played a part in the development of P U B L I S H E R & P R I N T E R

IP Exposé is published by KASS International Sdn Bhd Suite 8-7-2, Menara Mutiara Bangsar, Jalan Liku, Off Jalan Riong, Bangsar, 59100 Kuala Lumpur, Malaysia T (603) 2284 7872 F (603) 2284 1125 E ipr@kass.com.my Regional Office KASS Regional IP Service Pte. Ltd. 190 Middle Road, #03-21, Fortune Centre, Singapore 188979 T (65) 6338 1323 F (65) 6334 3127 E ipr@kass.com.sg Indonesia Office PT. KASS Indonesia IP Services 46th - 50th Floor, Wisma 46, Jl. Jend. Sudirman Kav. 1, Jakarta 10220, Indonesia T (62) 21 574 8822 F (62) 21 574 8888 E ipr@kass.com.sg

This newsletter is intended only to provide an alert service on matters of concern or interest to readers and should not be treated as a legal advice on the issues discussed. For specific queries on IP matters, please contact us for further assistance. Note: The trademarks and images used in this newsletter belong to their respective owners. KASS does not claim any proprietary rights whatsoever; they are used solely for educational purposes.

HAPPY INDEPENDENCE DAY!

IP exposé AUGUST ’15

Reaping Rewards from the Breeding of New Plant Varieties BY P. KANDIAH In an earlier issue of the KASS IP exposé, we briefly reviewed the provisions of the New Plant Varieties Act 2004 (NPVA). But how can the Act be used advantageously to reap monetary rewards from the creation of a new plant variety (NPV), say, a new variety of orchid plant producing attractive ornamental flowers? Let’s explore this. The plant breeder, in order to obtain exclusive commercial rights to the new orchid flower, should first register the NPV under the NPVA at the Ministry of Agriculture (if the NPV satisfies the New, Distinct, Uniform and Stable (“NDUS”) criteria required under the NPVA). Next, he should register the NPV at least in the countries where he feels there is a commercial market for his new ornamental orchid flower. The registration of the NPV would enable the breeder (assuming he is also the registrant of the NPV) the following exclusive rights in each country where the NPV is registered: Producing or reproducing the NPV Conditioning the NPV for the purpose of propagation iii) Offering for sale iv) Selling & marketing v) Exporting vi) Importing vii) Stocking the material for any of the above purposes

similar rights in Singapore under the corresponding NPV Act of Singapore. Therefore in Singapore, he can prevent the import of the orchid flowers into Singapore where he could be sole importer and distributor of the orchid flowers. He will have the right to restrict import of the orchid flowers into Singapore from any other country. Of course the plant breeder may not establish his own operations in Singapore, but he could grant a license to, say, an importer in Singapore to import and distribute the orchid flowers for a royalty fee.

i) ii)

The Breeder’s right also extends to: a)

Any propagating material of the registered NPV (such as seeds, cuttings, grafts, tissue cultures) and harvested material from the NPV (such as flowers, fruits, plant juice); Any other plant varieties which are essentially derived from the registered NPV if the latter is not essentially derived from another plant variety; Any material derived from material harvested from a registered NPV. For example, the exclusive rights extend to mango juice extracted from mangoes harvested from a NPV of a mango tree.

The NPVA grants extensive exclusive rights to the plant breeder, assuming he is the owner of the registration. It can be seen in our case of a new variety of ornamental orchid flower – the plant breeder can stop others from cultivating the new variety of orchids in Malaysia, and selling the harvested material from the NPV, i.e., the orchid flowers. He also has the exclusive right to prevent others from importing the orchid flowers from any other country even though the NPV is not registered in a country where the NPV is cultivated. He has the exclusive right to export the flowers from Malaysia to any other country. If our plant breeder has registered NPV in, say, Singapore, then he would have

Analogous rights would extend to other NPVs and harvested material of the registered NPVs. For example, vegetables, fruits, plant juices (resins, latex, etc.). As agricultural land becomes scarce and expensive in Malaysia, plant breeders can create NPVs where the plant itself or harvested material from the plant (such as flowers, fruits, etc.) have a high commercial value, and register the NPV in the countries where there is likely to be a good demand for the NPV or the harvested material. Cultivators of temperate flowers in Europe have successfully registered NPVs in Japan, and granted licences to importers in Japan. So if an importer imports the ornamental flowers from any other country, say China or Vietnam, which are nearer to Japan by flight, they pay a royalty to the registrant of the NPV in Japan. The registrants of the NPV may not be interested in the market in China and so the NPV is not registered in China but the lucrative market in Japan for the ornamental flowers is protected. In fact, many of the European cultivators of new varieties of chrysanthemum flowers provide plant propagating material (seedlings) to farmers in Laos and Vietnam who are permitted to export the harvested flowers to Japan, where the cultivators have a registered NPV right. In a way, it is outsourcing the labour-intensive farming practices from Europe to a low-cost country but reaping the profits of their endeavor from the sale of the ornamental flowers in Japan where the flowers fetch high prices as there is significant demand for the flowers. The intellectual property rights (IPR) in the NPV and the value chain in the exploitation of the IPR is still in the hands of the registrant of the NPV. .end.

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IP exposé AUGUST ’15

Is IP Protection Still Relevant? BY VINCENT TEH with more audacity, speed, and proficiency; has IP registration become the Maginot line of IP protection?

In the past three decades, the exponential growth of technology and rapid globalisation of trade have to some extent outstripped the development of IP laws and regulations. This led many to question the practicality of IP protection and whether it is still needed. That question, however, I think is misplaced. IP is essentially an asset, and like any other assets that are of value, you will naturally want to protect it. We’ve created bastions, castles, moats, booby traps, labyrinths, vaults, safes, subterranean bunkers and sharks with lasers attached to their heads, to keep our valuable possessions safe. We use security codes, finger print scanners, retina scanners, voice recognition, face recognition and hundred character long alphanumerical passwords to protect our money. So why wouldn’t we want to make an effort to protect our intellectual assets? As our global economy is slowly transitioning to a knowledge-based economy, IP protection will become increasingly more crucial. Yes, I concede that the development in some areas of IP law is at the pace of a handicapped snail. Yes, sometimes it seems as though the law has no idea how to adapt to the changing economical landscape. But that doesn’t mean we should roll over, play dead and hand our IP rights over to every Chan, Jorge and Harry. We humans did not get to where we are now by quitting. Can you imagine if our caveman ancestor had said “fire hot… burn hands… fire bad… no want fire!” We must adapt and utilise the present laws and regulations to make the best of things, because unless and until we are living in a utopia where everything is communal and shared (which will never be the case), IP protection will remain vital. Accordingly, it is not a question of whether IP protection is still relevant, but I think the question should be whether the IP protection strategies created decades ago are still relevant today. IP registration has long been touted as the pinnacle of IP protection. And fair enough, IP registration provides you with a prima facie evidence of ownership, much like a title deed of a house. It also allows you to enforce your rights with infringement action. Indeed both of these are very crucial weapons to protect your IP against anyone who wishes to misuse it. However, with copycats operating

Normally registration requires time (e.g., in some countries it could take years for an IP right to be registered). For some IP this wouldn’t be much of a problem. Trademarks, for example, tend to increase in value with time. But now, a lot of modern technologies have the shelf life of a fruit fly, becoming museum exhibits within a few months. This situation requires fast action, and businesses simply cannot wait for a patent to be registered. For this we can take a page from the operation module of the SR71 Black Bird. The Black Bird is an American long-range strategic reconnaissance aircraft that was designed to operate deep behind enemy lines. However, strangely enough, for an aircraft whose purpose was to snoop around Stalin’s living room, it was not designed to carry any defensive weapons. The Black Bird didn’t need any because it’s the love child of a ninja and the Roadrunner. It was designed to be stealthy to the enemy’s radar, using radar absorbing materials and shapes that would reflect the radar’s beam away from its origin. And with a top speed of 3,540 km/h, it’s the fastest air-breathing aircraft in the world. The plane could easily outfly any aircraft, missile or empty vodka bottle that Mother Russia could throw at it. Drawing inspiration from the Black Bird, you can rely on trade secrets to be stealthy, i.e., keeping your technology hush hush by limiting the access to the technical know-how to as few as possible, and always on a need-to-know basis. It is also crucial to back that up by signing Non-Disclosure Agreements/Confidentiality Agreements with anyone who will come in contact with your secret (e.g., OEM manufacturers, employees, contractors, etc.). You would also want to hit the market hard and fast before any competitors can reverse-engineer, replicate and compete with your products. Rapid development, production and commercialisation of your technologies will mean that the competitors won’t even know what hit them before you ran away with their market share. However, the drawback of trade secrets is that, unlike registerd IP rights, you do not have exclusive rights to your creation. This means you will not be able to prevent others from coming up with the same products or

IP exposé AUGUST ’15 processes independently of you. Also, it is difficult to keep any secrets over a long period of time or when more people are aware of it. Some products will require a long R&D process and may take a long time to market to the consumers. Without patent or design registration, you will quickly lose market control and share as more and more of your competitors free ride on your R&D. Sometimes you may also find that your creation does not fit into any of the commonly recognised four or five IP rights and thus cannot be registered. You may have a brilliant family recipe from your third cousin, twice removed, or you may have a great teaching method that would scare the stripes off the Tiger Mom. Both of which cannot be registered as patents. Nevertheless, all is not lost, you may still be able to find a way around that by relying on your branding to carve out a sizeable chunk of the market pie. Ever heard of Brand Loyalty? No? Try telling an Australian that Vegemite tastes exactly like Marmite. You’ll likely be battered with a didgeridoo and/or thumped with boomerang clapsticks. Oftentimes, human affinity for fanaticism is the greatest blessing to businesses. Brand loyalty will help turn your customers into bosom friends that will stick with you through thick and thin, no questions asked. The prerequisite of attaining brand

loyalty is of course the existence of a brand, and the most common manifestation of a brand is in trademarks and sometimes the product. Think the Golden Arches, the Coke bottle, the robin shell blue box, the blue diamond shaped pill, the Montessori education, the Dyson vacuums, the Atkins diet; all of which may be registered as either trademarks, designs or both. Registration of your brands gives you exclusive rights to them. It allows you to hold on to your identity, and with that, all your aboriginal musical instrument swinging devotees.

While it is true that IP registration is not a panacea to all your problems, we cannot deny that it still has a big role to play in the new economy. Registration gives you exclusive rights to use and commercialise your IP and it is this monopolistic right that will give value to your creation. Think of it this way: If I offered you a brand new Lamborghini for 20% of the market price, would you buy it? What if I told you there is a catch? The catch is that (i) you cannot sell the car to anyone; (ii) you must never lock the door; (iii) you must leave the keys on the dashboard; and (iv) you can never stop anyone who wants to from driving your car. Would you still buy the car? .end.

The Burning Question – Who Owns the Polo Trademark? BY GEETHA K. AND GIRIJA THEYAGARAJA “Polo” shirts have existed since the 19th century and are frequently associated with polo, which is still sometimes considered a sport for the elite. The sport gained popularity amongst the British Army and British tea planters in India and was brought into England in 1862. As the sport spread, so did the popularity of the polo shirts (also used in tennis then), which evolved from long sleeved button-down attire worn by the players into what it is today, a casual soft collared shirt. Lacoste and Ralph Lauren were two brands that popularized the shirts, both having the foresight to capitalise on the growing demand of the polo shirts by expanding their clothing line to include different varieties of the shirt. Ralph Lauren went one step further to include the word “Polo”, which is arguably descriptive, as part of its trademark:

Now, how does one claim exclusive rights to both the word “Polo” and the device of a player on a horse? Likely through extensive use of the brand in the marketplace, rendering acquired distinctiveness in the mark. Having said that, it may surprise you to know that the mark “Polo” is not owned by Ralph Lauren in some countries. In fact, in South Africa, the Polo trademark and the image of the player on a horse is owned by another party, unrelated to Ralph Lauren. Also, the United States Polo Association (USPA) has had a few “encounters” in the US with Ralph Lauren on the use of the word “Polo” and the use of the image of the player on a horse. These encounters resulted in a Settlement Agreement between the parties in 2003. Curiously, despite the Settlement Agreement, Ralph Lauren recently initiated an opposition proceeding in Singapore

against the application of the mark “ ” for eyewear products (Class 9). Ralph Lauren relied on their earlier

registered trademark “

” in Singapore, registered

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IP exposé AUGUST ’15 for the same type of products, and claimed that USPA made the application for their mark in bad faith as the application is prohibited by the Settlement Agreement. The Settlement Agreement was not adduced as evidence due to confidentiality clauses within the agreement. However it was claimed by Ralph Lauren that the Settlement Agreement regulates the manner of use of the USPA trademarks by USPA and restricts the use of their marks to products in Class 14, Class 18, Class 25 and Class 28 only. Use of the USPA marks in Class 9 (for eyewear) is prohibited.

USPA, in their defence, argued that Ralph Lauren misinterpreted the Settlement Agreement and that the terms of the agreement govern the manner of use of the USPA mark in Classes 14 (watches only), 18, 25 and 28 (solely goods related to the sport of polo) only. It does not restrict the use of their mark in other classes. USPA adduced evidence of its trademark registrations in other classes in Singapore (Class 3) and Hong Kong (Classes 9, 16, 24 and 34). Ralph Lauren argued that the registration in Singapore was pre-Settlement Agreement and as for the registrations in Hong Kong which were post-Settlement Agreement, Ralph Lauren reserved their rights to take action. The Registrar rejected the bad faith argument because Ralph Lauren was unable to prove with evidence that USPA had used the mark in bad faith. The Registrar

concluded that the element of bad faith could not be established as it was merely based on inferences. On the ground that the marks are confusingly similar, the Registrar concluded that it is undeniable that there are some similarities between the marks but taking the marks as a whole (Ralph Lauren’s single polo player mark versus the USPA’s double player polo mark with the text “USPA”), there is a very low degree of similarity. Both parties, going all out in this opposition, also argued on the pricing of their products. Ralph Lauren strongly argued that USPA’s eyewear is not expensive and they are ordinary and common products available at optical shops frequented by the general public who would not pay greater care and attention when buying them. Ralph Lauren emphasized that USPA’s mark, a device of double horsemen, would be unclear on the frames of the eyewear and they would be very similar to the single polo player mark. The Registrar clarified that the issue of pricing is not relevant to the products sold by the parties. What is important in determining the purchase of eyewear is the common practice of a consumer, that being the consideration and attention given when buying eyewear. The consumer will normally closely inspect the eyewear that they intend to buy, to determine whether the spectacle frame fits well and is comfortable to use. By doing so, the consumer will be able to recognize the mark present on the eyewear and be capable of differentiating it from other brands. The Registrar firmly decided that there was no confusion between the marks. This opposition in Singapore thus failed and USPA’s “ ” mark galloped closer towards registration. What was cemented in this opposition is the fact that bad faith allegations are not to be taken lightly – one should only bring forth allegations of bad faith if they have solid evidence to prove it. In this case, Ralph Lauren had a long shot as the only evidence they had was the Settlement Agreement which itself was in a cloud of secrecy. .end.

Towards Creative Indonesians… BY CAROLA MONINTJA 2014 was a historic year for Indonesians, the culmination of which was the election of the new President. It was, naturally, the hottest topic of discussion for all Indonesians, and a time full of intrigue and anxiety as Indonesians eagerly waited to find out who would become the next leader of the country. Undoubtedly, 20 October 2014 was a momentous day for Indonesians. The newly elected President and Vice-President, Joko Widodo and Jusuf Kalla, were inaugurated for the period of 2014-2019, after winning the most closely contested presidential election in the history of the world’s third largest democracy.

IP exposé AUGUST ’15 Many Indonesians, myself included, are excited to see the impact Joko Widodo’s presidency will have on the nation, as an innovative and determined man. One of Joko Widodo’s recent initiatives has been to set up the Creative Economic Agency (Badan Ekonomi Kreatif) or “BEK”. As a president who recognizes the importance of Intellectual Property (IP) rights protection, he realizes that encouraging innovation in the creative industries and increasing awareness and appreciation of IP rights can act as a catalyst to increase revenue growth and welfare in the Republic. The establishment of the BEK proves that the Indonesian Government is paying serious attention to promoting the development of a creative economy, a sector that has become one of the influential contributors for the country’s revenue. The BEK was officially established on 26 January 2015, and is headed by Triawan Munaf, who reports directly to the President, allowing the President to directly monitor BEK activities.

KASS TEAM AMONG MALAYSIA’S LEADING TRADEMARK PROFESSIONALS We have more reasons to celebrate this month as KASS was recently lauded in the 5th edition of the World Trademark Review 1000, which featured these very encouraging words: “KASS International’s finely tuned filing operation is far from the only reason why it has been entrusted with the protection of a litany of famous marques. In addition to trademark and brand strategy, the agency is moving into the valuation space, with one of its professionals having recently completed the government’s IP valuation training programme. Many large local clients have recently come on board to round out its strong roster of international patrons. The esteemed P. Kandiah has secured some of Malaysia’s most important trademark rulings for his clients. Geetha Kandiah is a rising star of the profession; she heads the trademark practice."

We at KASS thank you for all your support throughout the years and look forward to serving you better!

The BEK is essentially a body that supports the President in formulating, establishing, coordinating, implementing and synchronizing of policies in the field of creative economy. Previously, creative economy affairs were under the Ministry of Tourism (formerly the Ministry of Tourism and Creative Economy). However, the President’s keen interest in matters concerning the creative economy, led to the Presidential Regulation No. 6 Year 2015, upon which BEK was formed. Indonesia classifies its creative industry into 15 industry sub-sectors, namely: (1) architecture, (2) design, (3) fashion, (4) film, video and photography, (5) handicrafts, (6) software and computer services, (7) music, (8) arts and antiques market, (9) printing and publishing, (10) advertising, (11) interactive games, (12) research and development, (13) art performance, (14) radio and television, and a recent addition, (15) culinary. As a “baby agency” BEK is still finding its footing and learning the ropes in the planning and implementation of initiatives to accomplish its main objectives. I am optimistic that the existence of BEK will bring favourable conditions for creative industries and also IP rights protection in Indonesia. On that note, I would like to wish all Indonesians a wonderful Independence Day – “Selamat Hari Kemerdekaan, untuk seluruh rakyat Indonesia. Merdeka!” .end.

Around the region in an IP minute

THE PHILIPPINES

VIETNAM

IPOPHL: my|phone and iPhone not similar

Vietnam celebrates Trademark Week

In a recent trademark case that pitted tech giant Apple Inc. against homegrown Philippine company Solid Broadband Corporation, the IP Office of the Philippines (IPOPHL) decided in favour of the latter.

The Ministry of Industry and Trade has launched a nationwide initiative to promote domestic products and brands, encouraging Vietnamese consumers to take pride in local goods and support local producers. While the campaign is scheduled to run from July to October 2015, the highlight of the initiative, which has been dubbed “Vietnam Trademark Week”, will take place in Ho Chi Minh City, Hanoi and Da Nang from 23rd – 29th September.

Apple filed an opposition against the mark “my|phone” for Solid Broadband’s mobile phone line, claiming it was “confusingly similar” to their “iPhone” mark. However, IPOPHL Director, Nathaniel Arevalo, found otherwise and concluded that mobile device consumers tended to be more discerning when it comes to purchasing such goods and “the fame and popularity of iPhone in fact makes it improbable for one to confuse the my|phone product as an iPhone”.