distinctive phrases and the kit kat case · 4 convergence dla’s newsletter from the technology,...

EDITION 12

Distinctive Phrasesand the Kit Kat Case

Technology Transfer:The Proposed New Regime

Indies - Keeping the Crown Jewels?

New Rules on Spam

and much more...

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DLA’s Newsletter from the Technology, Media & Communications Group

Convergence

2 Convergence DLA’s Newsletter from the Technology, Media & Communications Group

IntroductionWelcome to Edition 12 of Convergence in which we focus on some importantdevelopments regarding trade marks for sounds, smells and colours, together with the new competition rules for technology transfer agreements (which, for the first time, also extend to software agreements).

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3Convergence DLA’s Newsletter from the Technology, Media & Communications Group

Ever since the implementation of the EU Trade Mark Harmonisation Directiveacross the EU (in the UK by means of theTrade Marks Act 1994) there has beenmuch discussion about whether soundsand smells can validly be registered astrade marks. Two decisions by the ECJhave now given guidance. The answer isthat sounds and smells can both potentially be registered as trade marks in theory. However, the acceptable ways of representing such marks arerestricted. The only definitely acceptableway of representing sounds is by use ofmusical notation. It is very difficult to see how, in practice, smell marks can bevalidly registered.

What can be registered as a trade mark?

The definition of what can potentiallyconstitute a trade mark is set out in theTrade Marks Directive and the UK TradeMarks Act as follows:

“A trade mark may consist of any signcapable of being represented graphically,particularly words, including personalnames, designs, letters, numerals, theshape of goods or of their packaging,provided that such signs are capable ofdistinguishing the goods or services of oneundertaking from those of otherundertakings.”

The definition states that so long as a signfulfils two requirements, then it may be atrade mark. These are (1) that the sign mustbe capable of being represented graphicallyand (2) that the sign must be capable ofdistinguishing the goods or services of anundertaking. As well as setting out these tworequirements, the definition details somespecific examples of kinds of signs whichmay be registrable. These do not expresslyinclude sounds or smells.

What has been the attitude of the UKTrade Marks Registry?

Initially, following the implementation of theTrade Marks Act 1994, the Registry alloweda number of sound and smell marks to beregistered. Sound mark registrations whichhave been allowed include the Direct Lineinsurance jingle, the “Mister Sheen shinesumpteen things clean” jingle and “thesound of a dog barking” for Dulux paint.Smell mark registrations which have beenallowed include “the strong smell of bitterbeer” for darts and “the smell of roses” fortyres. On the other hand, an application byChanel for the smell of Chanel No. 5 wasrejected, on the basis that the smell of aproduct itself can not act as a trade mark.

What smell and sound marks can beregistered following the ECJ decisions inSieckmann and Shield Mark?

As stated above, any mark has to fulfil tworequirements in order to be validlyregistrable. The requirement that the markmust be capable of distinguishing the

goods or services of an undertaking is ofvital importance, since it goes to the heartof the function of a trade mark, which is toact as an indication of the origin of thegoods or services. Smell and sound marksmay face particular obstacles in relation tothis, since they are, invariably, usedalongside other marks, such as words andlogos, and it may be difficult todemonstrate that customers recognise thesound or smell as indicating origin.

However, the two ECJ decisions havefocussed on the second requirement, thatmarks must be capable of graphicrepresentation. Smell and sound marksraise obvious issues in relation to therequirement of achieving a representationon the register such that anyone looking atthe register can know what the registrationis and what the scope of protectionafforded is. It is difficult to put down asmell or sound on paper, certainly in a waythat would be readily accessible to amember of the public looking at theregister. Further, everyone’s perceptions ofa smell or sound will be different.

Sieckmann

The first ECJ decision relating to smell orsound marks was the Sieckmann case inDecember 2002 which dealt with the issueof graphic representation, specifically forsmells. The application was for the smell ofthe pure chemical substance methylcinnamate, a sample of which wasdeposited, and the structural formula ofwhich was stated to be C6H5 - CH =CHCOOCH3. It was further described asbeing ‘balsamically fruity with a slight hintof cinnamon’.

The ECJ stated that, “A trade mark mayconsist of a sign which is not in itselfcapable of being perceived visually,provided that it can be representedgraphically, particularly by means ofimages, lines or characters, and that therepresentation is clear, precise, self-contained, easily accessible, intelligible,durable and objective”.

Thus the ECJ set out a list of requirementsfor a graphic representation to besufficiently precise, clear and objective fora smell to be registrable. The ECJ went onto state that the requirement would not besatisfied in relation to smells “by a chemicalformula, by a description in written words,by the deposit of an odour sample or by acombination of these elements.”

This decision makes it very difficult, if notimpossible, to register a smell as a mark, atleast until such time as it can bedemonstrated that technology exists whichcan identify smells with sufficient clarity,precision and objectivity. Certainly, theexisting UK registrations referred to abovewhich involve written descriptions of smellsmust now be considered invalidly registered.

Shield Mark

The only other ECJ judgment to date relatingto smell and sound marks is the unreportedShield Mark case of November 2003 whichconcerns various registrations in the Beneluxcountries for sound marks, includingregistrations for the first nine notes of theBeethoven work Für Elise and registrationsfor the sound of a cockerel crowing.

The judgment makes clear that soundmarks must be considered capable ofbeing regarded as trade marks, providedthey are capable of distinguishing andcapable of being represented graphically.It confirms that the requirements forgraphical representation set out inSieckmann (and quoted above) apply tosound marks. In the context of sounds theECJ went on to state:

“…those requirements are not satisfiedwhen the sign is represented graphically bymeans of a description using the writtenlanguage, such as an indication that thesign consists of the notes going to makeup a musical work, or the indication that itis the cry of an animal, or by means of asimple onomatopoeia, without more, or bymeans of a sequence of musical notes,without more. On the other hand, thoserequirements are satisfied where the sign isrepresented by a stave divided intomeasures and showing, in particular, a clef,musical notes and rests whose formindicates the relative value and, wherenecessary, accidentals.”

The Shield Mark judgment confirms thatrepresentation of sound marks usingdetailed musical notation is acceptable, butrules out a number of other possibilities. Itdoes not address the question of whethersonograms, which have been used for anumber of successful registrations around the EU, are acceptable.However, it must be doubted whether such a representation would be considered sufficiently easily accessible.

The existing UK registrations for jinglesreferred to above probably comply with therequirements for graphical representation,but the registration for the sound of abarking dog for Dulux paints must now beconsidered invalidly registered.

The future

Sounds and smells can play a part in theoverall branding of goods and services,and it seems that they will increasingly doso. Those using them are likely to benefitfrom some protection afforded by unfaircompetition laws, passing off or similar, or,in the case of “musical” marks at least,copyright. However, the circumstances inwhich sounds and smells are going to bevalidly registrable as trade marks are veryrestricted and may, in practice, be limitedonly to the registration of sounds usingdetailed musical notation.

Sound and Smell Trade MarkRegistrations: Sound, or a Bit Fishy?

“The idea that acompany can claimmonopoly rights in

a phrase that they haveused in advertising

may at first seempotentially dramatic”


Distinctive Phrases and the Kit Kat CaseWithout a distinctive character a trade mark cannot fulfil its “essential function” - to allow consumers to distinguish between goods (or services) of one manufacturer and those of another.

According to the Linde case the ability todistinguish in this way allows consumerswho have purchased goods “to repeat theexperience if it proves to be positive, or toavoid it if it proves to be negative”. Itthereby protects consumer choice and helpsmaintain competition in the marketplace.

Section 3(1)(b) of the Trade Marks Act1994 accordingly prohibits registration ofmarks which are “devoid of any distinctivecharacter”. This is, however, subject to theproviso that registration shall not berefused if the mark has in fact acquired adistinctive character as a result of the usemade of it. Identical provisions are foundin article 3(1) of the EC Trade MarkDirective and article 7(1) of the ECRegulation on the Community Trade Mark.

The courts have been forced to consider therequirement of distinctive character on anumber of occasions. In Société desProduits Nestle S.A. v Mars UK Limited (the“Kit Kat” case) the Court of Appeal stated,in relation to section 3(1)(b) at least, “therelevant principles are now wellestablished”. This article will look at thebackground to this case, consider whatthese “well established” principles are andhighlight one outstanding thorny issuewhere principles are not so well established.

Background

It will come as little surprise to mostconsumers that Nestlé has alreadyregistered both the “KIT KAT” mark and thephrase “HAVE A BREAK…HAVE A KITKAT”. This case concerns their attempts toregister “HAVE A BREAK” as a trade markon its own. Mars challenged Nestlé’sapplication and following a hearing in May2002, the Hearing Officer agreed with atleast part of the objection. “HAVE ABREAK” was, on his interpretation of thelaw, devoid of distinctive character.

Nestlé had tried to rely on the proviso tosection 3(1) that registrations shall not berefused if the mark has become distinctivethrough use. However, “HAVE A BREAK”had not been used on its own to anymaterial degree. The Hearing Officerdecided that the words on their own couldnot, therefore, have acquired a distinctivecharacter and the application was refused.Nestlé appealed to the High Court.

The appeal was heard by Rimmer L J whodecided that the Hearing Officer hadapplied the law correctly and had givencareful consideration to the factual questionof whether “HAVE A BREAK” enjoyeddistinctive character. Nestlé’s use of it had,in his opinion, “failed to foster a concreteexpectation among consumers that thegoods originate from one undertaking” andso the appeal failed. Nestlé appealed tothe Court of Appeal.

The Court of Appeal had two questions to answer:

1 Is “have a break” devoid of distinctivecharacter?

Mummery L J referred to three earliercases that had been heard by the ECJ.Fortunately it had reached similar decisionsin each:

1 first the mark must be distinctive in thesense that it distinguishes goods asoriginating from one undertaking;

2 secondly distinctiveness must beconsidered by references to the classesof goods registration is sought for andconsumers of those goods; and

3 thirdly the relevant (hypothetical)

consumer is the well-informed and

circumspect consumer.

A mark which is distinctive and can

distinguish goods to any extent will not

fall foul of section 3(1)(b). Thus the

Hearing Officer had applied the law

correctly and, whilst other officers may

have reached a different conclusion on

the facts of the case, on the evidence

before him he was entitled to find that

“HAVE A BREAK” was devoid of distinctive

character. The Court of Appeal would not

interfere with his decision.

2 Has “have a break” acquired

distinctive character as a result of the

use made of it?

This is essentially a question of fact and

the appeal courts are generally reluctant to

interfere with earlier findings of fact. The

Hearing Officer had decided (and the High

Court agreed) that there had not been

sufficient use of the mark on its own for it

to fall within the proviso. In arriving at this

conclusion he had decided that use of

“HAVE A BREAK” within “HAVE A

BREAK…HAVE A KIT KAT” was not use of

the mark itself.


But was this interpretation of section 2 rightor can a mark acquire distinctive characterwhen its use has been as part of anothermark? Mummery L J decided that sincethe Trade Marks Act must be interpreted inline with the Trade Marks Directive, this wasa matter for the ECJ. Thus a question wasreferred to Luxembourg in these terms. Itis anticipated that the opinion of theAdvocate-General is unlikely to bepublished before summer 2004.

The future

The importance of the ECJ’s decision toNestlé is obvious. An answer in theaffirmative will mean that the earlier decisionsare likely to be set aside and the case sentback to be reheard by a different HearingOfficer who might find in their favour.

A negative answer will almost certainlyfinally shut the door on its application.

But if the ECJ does give a positive answer,will other owners of famous brands also berubbing their hands together? The ideathat a company can claim monopoly rightsin a phrase that they have used inadvertising may at first seem potentiallydramatic. Could a positive response signal a move away from the court’straditional reluctance to allow companies to claim monopoly rights over commonwords or phrases?

In short, the answer is likely to be no.Even if the ECJ decides marks can acquire distinctive character through use as part of a different mark,applicants will still need to show that thishas been acquired as a matter of fact.

Sedley L J in the Court of Appeal hadserious doubts as to whether in this case,even given an affirmative answer by theECJ, it would be open to a different HearingOfficer to find in Nestlé’s favour.Regardless of the ECJ’s decision, brandowners will still be faced with the challengeof convincing the courts that there is a“concrete expectation” among consumersthat goods bearing the relevant wordsoriginate from them and no other. Forcommon words and phrases, the courts willnot be easily convinced.

“It will come as littlesurprise to mostconsumers that Nestléhas already registeredboth the “KIT KAT”mark and the phrase“HAVE A BREAK…HAVE A KIT KAT”

The Court of Appeal had two questions to answer:

1 Is “have a break” devoid of distinctive character?

2 Has “have a break” acquired distinctive character as a result of the use made of it?

Despite a finding that Lambretta’s fashiontrack top featuring an original colour waydesign had in fact been copied by a thirdparty, the court ruled that this did notinfringe design right or copyright. Therewas no design right because the colourway design was in two dimensions (ratherthan three). The copyright in the originaldesign drawing was not infringed becausethe drawing depicted a colour way appliedto a 3D article (being a garment). However,had Lambretta’s drawing been simply of itscolour way design (and not the garment),copying it without consent would have beencopyright infringement!

The case of Lambretta v Teddy Smith andNext involved the complicated overlapbetween design rights legislation andcopyright legislation under the Copyright,Designs and Patents Act 1988 (“CDPAct”). Lambretta had designed a track top(“Track Top”). As the Track Top itself wasa standard design, Lambretta did not claimoriginality of its outline shape. However, itdid claim that the “retro-vintage” colour waycomprising blue, red and white “early1970s” logos and stripes was original(“Colour Design”) and that it was entitledto prevent it being copied.

Teddy Smith and Next sold garments which Lambretta said were copies of the Track Top.Lambretta sued Teddy Smith and Next for infringement of its design right in the Track Top and its copyright in the documents recording the design.

To prove design right infringement,Lambretta needed to show originality in“the design of any aspect of the shape orconfiguration … of the whole or part” of theTrack Top and/or Colour Design (subject toexceptions, including surface decoration)under section 213 of the CDP Act.Lambretta argued that the Colour Designapplied to the Track Top was a“configuration” because it depicted therelative arrangement of parts or elementsof a design. However, the court found thata “configuration” only refers to the three-dimensional aspects of articles. As theColour Design was made up of twodimensional colours, it was not protectedby design right.

What about copyright protection?Lambretta alleged that Teddy Smith andNext had infringed its artistic and literarycopyright in two drawings. The firstfeatured the Colour Design on the front ofthe Track Top (“Colour DesignDocument”) and the second recorded the (uncoloured) design of the front ofthe Track Top and half of its rear (“Track Top Document”).

Teddy Smith and Next argued that boththese documents recorded the shape andconfiguration of the Track Top (albeit thatone incorporated the Colour Design) andthat the Track Top was not an artistic work,so the documents were design documentswithin the meaning of section 51 CDP Act.This states:

“It is not an infringement of any copyrightin a design document or model recordingor embodying a design for anything otherthan an artistic work … to make an articleto the design or to copy an article made tothe design.”

As a consequence, Teddy Smith and Nextargued that making the Track Top bearingthe Colour Design was not copyrightinfringement.

Lambretta argued that section 51 was to beinterpreted in a purposive manner and thatinsofar as a design document recordsmatters excluded from design right, suchas surface decoration, the documents werestill protected by copyright. As the ColourDesign was surface decoration, copying itinfringed the artistic copyright in the ColourDesign Document. The court disagreed.

It said that in giving the words of section51 their natural and ordinary

meaning, the section is directedat any copyright in the entire

design document.Therefore if a document

incorporates a designwithin the meaning of

section 213 of theCDP Act, there canbe no infringementof the copyright inany works whichwould ordinarily(absent a “design”element) qualifyfor protection.


Lambretta’s LoopholeDesigners and manufacturers of clothing or articles bearing surface decoration take note!


“Despite a finding that Lambretta’s fashion track topfeaturing an original colour way design had in fact been copied by a third party, the court ruled that this did not infringe design right or copyright.”

This finding potentially has far reachingconsequences. For example, if DavidHockney designed a T-shirt depicting anoriginal painting, there would be no designright in the actual T-shirt (because it is notoriginal) or the painting (because it issurface decoration). If the T-shirt were notregarded as an artistic work (if it were,section 51 CDP Act would not apply),copying the original painting from the T-shirt would not be an infringement of theartistic copyright in the painting (becausethe drawing incorporates a design for a T-shirt). Of course, had David Hockneycreated his painting first, then applied thepainting to a T-shirt, he would be entitled toprevent infringement of the artisticcopyright in the painting.

It is understood that the Lambretta case isto be appealed in April 2004. So, pendingthe judgment being overturned on appeal,how could David Hockney protect his T-shirt design? Provided it was new and of‘individual character’, his design might wellattract protection under the CommunityDesign Regulation (EC) No 6/2002. Therelevant provisions should help to fill thegap between design right and copyright insituations where designers expend skill increating an original design to apply to anarticle of a common shape.

“The primary purpose of the proposed

changes is to bring theAct into line with

the revised EuropeanPatent Convention

(2000) (“Convention”).”


The primary purpose of the proposedchanges is to bring the Act into line with therevised European Patent Convention (2000)(“Convention”). However, the DTI inconjunction with the Patent Office has takenthe opportunity to consult with industry on awide range of issues which, although notrequired for the purpose of implementingthe Convention, are thought to offer a fairerbalance between the rights of patentholders and third parties or simply betterreflect modern practice.

This article summarises a few of theproposed amendments which, havingreceived wide support, will be takenforwards in the form of the Patents Act(Amendment) Bill (“Bill”).

Post-grant amendment - proprietor’sconduct irrelevant

Currently, patents can only be amendedpost-grant with the court’s discretion.The court takes into account factorsconcerning the proprietor’s conduct,such as whether the proprietor hasunreasonably delayed seeking theamendment or has sought to gain an unfairadvantage from a patent which it knewought to have been amended.

The proposed amendment is partlyrequired to implement changes introducedby the Convention which remove thediscretionary power of the court in relationto amendments which limit the claims ofEuropean patents.

However, to avoid a complex systemwhereby the proprietors’ conduct is takeninto account for certain amendments butnot others, the Government intends toextend the effect of the new provision to allpost-grant amendments, whether or notthese limit the claims and in relation to bothnational and European patents. Allamendments must, however, continue tomeet the substantive requirements(particularly, they must not add matter, mustdefine a patentable invention and becapable of industrial application).

To address concerns that the absence ofdiscretion will encourage covetousproprietors to avoid amendment until thelast possible moment, the Government isalso considering the introduction of a newrestriction on the relief awarded to aproprietor who has acted in bad faith bytrying to enforce a knowingly bad claim, orwho has delayed unduly in seekingamendment. Patent proprietors shouldtherefore be aware that conduct may berelevant to their ability to claim relief forpatent infringement.

A separate amendment will allow aproprietor to apply to amend its patent inany proceedings relating to the patent.Under the current law, the court only hasjurisdiction to consider amendments inproceedings in which the validity of thepatent has been put in issue. This haspreviously caused difficulties where, havingfiled a counterclaim for patent revocation ininfringement proceedings, a defendant hassubsequently dropped the issue of validityby withdrawing its counterclaim.

Threats

A patent proprietor who has made everyeffort to track down an alleged primaryinfringer (the manufacturer or importer) will,under proposed new law, be able tocontact the alleged secondary infringer (ashop or customer) in certain circumstanceswithout giving rise to a threats action.

The principal aim of the current threatsprovisions, which confer on an allegedsecondary infringer who has beenunjustifiably threatened with patentinfringement proceedings a cause of actionagainst the patent proprietor, is to allow aproprietor to threaten a rival manufacturerwhilst protecting the rival manufacturer’scustomers from intimidation.

Any communication which goes beyondmere notification of the patent’s existenceis likely to be construed as a threat (thoughsubsequent proof of infringement providesthe proprietor with a complete defence to athreats action).

A problem arises where a manufacturer hastaken great care to conceal its identity, orwhere the supply chain is long, making itextremely difficult for the proprietor to tracethe alleged primary infringer. In thesecircumstances, the proposed amendmentwill allow the proprietor to contact the shopor person who is selling or stocking thealleged infringing goods in order to requestdetails of its supplier. It is likely that thenew law will require the proprietor to set outwhat efforts it has made (which will beassessed according to a high standard) toidentify the alleged primary infringer, so asto enable the alleged secondary infringer toassess whether a threats action is viable.

It is hoped that this limited, permittedcommunication will encourage genuineefforts at pre-litigation settlement.

Inventors’ privacy

In response to concerns over the privacy ofinventors, particularly those working incontroversial areas of technology, it ispurported that inventors will be able torequest that their addresses be keptconfidential. This new right will not extend tothe inventor’s name, because theunavailability of this information wouldprejudice the rights of third parties toquestion inventorship and entitlement, as wellas limit the ability of third parties to searchpatent databases using inventors’ names.

New non-binding assessment of validity...

A procedure for a non-binding assessmentof validity has been proposed. Theobjective is to provide a low cost means ofobtaining an early assessment of validity inthe Patent Office, as a faster alternative tofull-scale revocation proceedings. It ishoped that this will encourage parties tosettle patent actions at the earliest stage ofa potential dispute.

Under the proposed amendments, theassessment may be requested by anyperson, who need not declare an interest,although the Patent Office will have adiscretion to reject vexatious requests.

Patents get a FaceLiftAt long last plans to modernise the Patents Act 1977 (“Act”) are under way.


Revocation of the patent will not beavailable through this route nor, in responseto specific concerns voiced by members ofthe Patent judiciary, will the assessmentprovide means to prevent or delayproceedings for revocation or infringementof a patent.

…and infringement

To complement the new validityassessment, the draft Bill will also containprovisions relating to a new infringementassessment in the Patent Office. The resultwould be a non-binding opinion on whetheror not a particular object, act or process(as described or submitted as part of awritten statement of grounds) infringed aparticular patent. As with the validityassessment, it is proposed that any personwill be able to request an infringementassessment without having to declare aninterest. Again, the Patent Office wouldhave a discretion to reject the request.

The infringement assessment would beavailable either on its own or together witha validity assessment and is hoped toprovide a mechanism to assist in the earlysettling of disputes.

And those which fell at the hurdle...

A number of amendments proposed in the Consultation Paper will not be takenforward, having met with opposition from consultees.

The proposals which provoked by far themost comment, from all categories ofconsultee, were those concerning theprovisions which govern compensation foremployee-inventors. Currently, the Actprovides that an employee-inventor shouldbe awarded compensation by his employerwhere the patent resulting from his or herinvention has been of “outstanding benefit”to the employer. To date no employee hassucceeded in claiming compensation underthe Act, despite the fact that employers areunable to contract out of the provisions. TheConsultation Paper queried whether this lackof success was indicative of the Act’s failureto achieve a fair balance between theinterests of the employer and employee.

The overwhelming response was that theprovisions should be left as they are.Corporate consultees pointed out thatcompanies had implemented their own in-house arrangements to reward employeesand that these arrangements wereresponsible for the low level of litigation.

Two multinationals suggested that theprovisions should be repealed entirely, oneof these commenting that it was theexistence of the current Germancompensation provisions (which, comparedto UK law, are weighted in favour of theemployee) that had ultimately been thedeciding factor in its choosing not to locatea new research and development facility inGermany. With the exception of onemodification, that the “benefit” should bethat derived from the patented inventionrather than the patent, the provisions willremain in their current form.

Also, the proposed Bill will not extend thecurrent “licence of right” concession, whichis available to defendants who importinfringing goods into the UK from the EEA, toimporters or distributors of infringing goodsfrom outside Europe. Nor will it include anamendment to allow patent proprietors tobring infringement proceedings before theComptroller without the defendant’sagreement. This proposed amendment fellunder strong criticism from the patent judgeswho described the proposal as ill thoughtout, unworkable and likely to undermine thePatents County Court.

According to the Patent Office, the draft Bill will be introduced to Parliament “assoon as parliamentary time permits”.A full summary of the Government’sconclusions can be found at the followingwebsite address:www.patent.gov.uk/about/consultations/responses/patact/summary.htm

“Currently, patents can only be amended post-grant with the court’s discretion”


Key changes envisaged are:

• extending the regime to software copyright;

• abolition of the white and grey lists;

• introducing market share tests; and

• treating agreements between competitors and non-competitors differently.

If all goes to plan the proposals (subject to any change resulting fromthe consultation) will become law on 1 May 2004. Ultimately, they will haveretrospective effect.

Setting the scene: technology transferagreements and competition law

As things currently stand, technologytransfers agreement will not fall foul of ECcompetition law if they fall within the ambitof the existing Technology Transfer BlockExemption which dates back to 1996.

Both the current and the proposed revisedTechnology Transfer Block Exemptions seekto address two seemingly contradictoryrequirements: IPR ownership andexploitation on the one hand andcompetition law on the other. At its mostsimplistic level, IPR ownership brings with itthe ability to protect and control rights,sometimes on a monopoly basis.Competition law, however, seeks to promotethe number of businesses with access totechnology and/or operating in a market.

As a general rule, the EC Treaty prohibitsanti-competitive agreements (whetherformal not). However, it does allow anotherwise anti-competitive agreement if theagreement’s positive effects outweigh thenegative effects. This exemption (i.e.tolerance of an otherwise anti-competitiveagreement) can be obtained in one of twoways. The first option is for the individualagreement to be assessed and notified tothe EC Commission. Alternatively, entirecategories of agreement are allowed via a“group” or “block” exemption. In practice,companies prefer taking the second route.The hassle, expense and time required toobtain individual assessment is notcommercially attractive.

Provisions contained in agreements whichare anti-competitive and do not benefit fromexemption (by block exemption orindividual assessment) are void andunenforceable. Further, they risk significantfines: up to 10% of the worldwide groupturnover of the parties.

Also any agreement that is acceptable froma European Competition point of viewbecause it benefits from Block Exemptionalso benefits from a “parallel exemption”under domestic competition legislation.

The current regime

The current Technology Transfer BlockExemption only applies to technologytransfer agreements concerning patentand/or know-how rights (although theCommission has expressed the view that it also applies to copyright and otherlicences by analogy).

It sets out:

• a “white” list of contractual provisionswhich do not normally restrictcompetition at all;

• a “grey” list of provisions which mayaffect competition if the market share ofthe parties is significant, but otherwisewill be capable of exemption; and

• a “black list” of clauses whosepresence in a licence agreement willalmost never be acceptable from acompetition law point of view andwhose presence in an agreement willdisqualify it from benefiting from theblock exemption. The black list containsthe most serious “hard core” restrictionson competition such as price fixing orresale price maintenance.

Why the proposed change?

A particular criticism of the currentTechnology Transfer Block Exemption isthat the inevitable slavish compliance withthe white list leads to formulisticagreements which may not accuratelyreflect the commercial intention of theparties. In fact, the Commission recentlydescribed it as a “straightjacket”.

The aim of the new regime is to:

• allow companies more freedom in theircontracts;

• extend the scope of the blockexemption to other types of intellectualproperty rights, not just patents andknow-how; and

• incorporate an element of economicrealism into the operation of the blockexemption.

Key changes proposed by the draft newTechnology Transfer Block Exemption

• Broader application

It will cover all types of technologytransfer agreements. Importantly, thisbroadens the scope of the regime.In addition to the patent and know-how agreements, which are subject to the current Block Exemptionconcerning software, copyright, will be specifically covered.

Technology Transfer:The Proposed New RegimeIn October 2003 the European Commission published proposals for a new technologytransfer block exemption.


• No white or grey list

In line with the Commission’s statedintention, the new block exemption willbe less prescriptive than the previousone. It will not contain a white list of“good” clauses: only a black list ofunacceptable clauses. Agreements cancontain any provision that is notspecifically blacklisted without riskingloss of the “safe harbour” provided bythe block exemption.

• Distinction between competitors andnon-competitors

There will be different blacklistedprovisions for agreements betweencompetitors and those between non-competitors. This reflects the practicalreality that agreements betweencompetitors are more “dangerous” froma competition point of view.

• Market share thresholds

Market share thresholds will apply.Therefore agreements between minorplayers in the market will not attract asmuch scrutiny as those between largerplayers whose activities are likely tohave more of an effect on competition.

What sort of agreements are technologytransfer agreements?

A typical technology transfer agreement isone where the main (not the secondary orancillary) aim of the agreement is for thetechnology owner to grant a third party alicence to use the technology so that thethird party can provide a product/service.However, some other agreements can alsobe caught; for example particulartechnology assignments. To be caught theassignment will “look” like a licence. Theassignor must retain the exploitation risk andthe fee it receives may well depend upon thesuccess of the assignee’s exploitation of thetechnology. Also certain sub-contracts. Forexample, where the licence of thetechnology needed for the sub-contractor tomanufacture the product is the primarypurpose of the agreement and, say, itcontains non-compete obligations. However,whilst agreements between more than twoparties are excluded, it is worth appreciatingthat in assessing these multi-partyagreements the authorities will use the blockexemption’s principles by analogy.

The market share test

The EC Treaty prohibits agreements havingan “appreciable” effect upon competition.Usually, whether or not there is anappreciable effect turns on the marketshare of the parties.

This is reflected in the market sharethresholds contained in the draftRegulation. It is proposed that the newBlock Exemption will only apply toagreements between parties whose marketshares fall under 30% for agreementsbetween non-competitors and 20% foragreements between competitors.

If the market share falls beneath thethreshold and the agreement does notinclude any of the blacklisted “hardcorerestrictions” (see below) then it will benefitfrom the new Block Exemption. If themarket share threshold is exceeded thenthe new Block Exemption does not apply tothat agreement. This does notautomatically make the agreement anti-competitive. It simply means that individualassessment is required. It is worthremembering that if a technology orproduct becomes particularly successful,or one of the parties is subsequentlyacquired, an agreement might move acrossthe market share threshold.

Hardcore restrictions (the “black list”)

The draft Regulation contains a list ofhardcore restrictions which are nearlyalways anti-competitive: the black list. Likethe market share test, the hardcore list alsodistinguishes between agreementsbetween competitors and those betweennon-competitors.

Where an agreement contains a hardcorerestriction it automatically falls outside ofthe new Block Exemption regardless of themarket share of the parties. Such anagreement will almost inevitably beprohibited (the de minimis rules do notbenefit a hardcore restriction). In fact,under the Enterprise Act 2002, entering intoagreements containing hardcorerestrictions may be a criminal offenceattracting penalties of up to five years’imprisonment and/or an unlimited fine forthe individuals responsible.

The black list for agreements betweencompetitors

To benefit from the new Block Exemption, itis proposed that agreements betweencompetitors and regardless of marketshare must not (in summary, there areexceptions):

• fix, or otherwise influence, prices to third parties;

• limit output or sales;

• allocate markets or customers; or

• restrict the licensee’s ability to exploit itsown technology, or that of either party tocarry out R&D.

The black list for agreements between non-competitors

There are slightly different proposed rulesfor technology agreements between non-competitors. Briefly (again this is asimplified summary), regardless of marketshare, the agreements must not:

• fix, or otherwise influence, prices to thirdparties. However, unlike the black list forcompetitors, maximum (but notminimum) and truly recommended (notfixed) resale prices are allowed;

• restrict the ability of the licensee to sell intoa territory/customer group. (There are 5important carve outs to this general rule.)

Additional provisions

In addition to the black list, it is proposedthat no agreement containing any of thefollowing provisions can benefit from thenew Block Exemption (be it betweencompetitors or not):

• any direct or indirect obligation on thelicensee to grant an exclusive licenceback to the licensor (or its nominee) ofany severable improvements in thelicensed technology;

• any direct or indirect obligation on thelicensee to assign to the licensor (or itsnominee) of any severable improvementsin the licensed technology;

• any direct or indirect obligation on thelicensee not to challenge the validity of the IPRs held by the licensor (though the licensor would be entitled in such circumstances to terminate the agreement in respect of the licensed IPRs).

Duration

Block exemption protection lasts for the lifeof the particular technology’s protection.This might be for the life of the relevantpatent or for as long as the know-how inquestion remains secret.

Timetable and transitional provisions

The consultation period for the draftRegulation closed towards the end ofNovember. Being a Regulation, oncefinalised the new regime will have directeffect in the UK; we do not need to passnational enabling legislation. TheCommission currently anticipates theRegulation entering into force on 1 May 2004.

An 18 month transitional period will apply totechnology transfer agreements already inforce on 30 April 2004. Where suchagreements would not be exempt (i.e. notbenefit from the block exemption) under thenew regime but nevertheless satisfied theexemption conditions of the currentRegulation, the general prohibition will notapply until 1 November 2005.

Next steps

Bearing in mind that the legislation willultimately be retrospective, key technologytransfer documents should be audited forcompliance in the run-up to the newregime. New agreements should also takethe new Block Exemption into account,although of course they are currentlysubject to the 1996 equivalent.


New Codes for

Programme Commissioning

The Communications Act 2003 ("the Act")

has been the catalyst for much discussion

and controversy as it progressed through

Parliament over the past year. One slightly

lower profile aspect has been the

provisions within the Act which concern

independent production companies

("Indies"). These essentially relate to the

quotas for independent programmes that

will be in broadcasters' licenses and also

codes of conduct which relate to the

commissioning of programmes by

broadcasters. It is these codes which will

form the subject of this article.

Under section 285 of the Act, Ofcom is to

include conditions, in the licenses of every

licensed pubic service channel ("PSB"), to

ensure that the PSBs draw up, revise and

comply with a code of practice (the

"Codes") setting out the principles it will

apply when agreeing terms for the

commissioning of independent productions.

The provisions of Section 285 of the Act

are an attempt to re-dress a widely

acknowledged imbalance within the

broadcasting arena. One of the conclusions

reached by the Programme Supply Review

conducted by the Independent Television

Commission ("ITC") was that many Indies

cannot negotiate with the PSBs on an equal

footing as a consequence of their relative

lack of resources and imbalance of power.

Indies have often been forced to assign to

PSBs intellectual property rights on an

outright world-wide basis. It was felt that,

were the bargaining positions more equal,

many of these rights would be retained by

the Indies.

What is an independent production?

For the definition of an "independent

production" see the Broadcasting

Independent Order 1991, as amended in

July 2003. An independent production

programme is a programme made by an

independent producer. Section 4 of the

order states that an independent producer

means a producer (a) who is not an

employee of a broadcaster (b) who does

not have a shareholding greater than 25%

in a broadcaster and (c) which is not a

body corporate in which any one

broadcaster has a shareholding greater

than 25% or in which any two or more

PSBs, when taken together, have an

aggregate shareholding greater than 50%.

So what provisions do these

Codes of Conduct contain?

Whilst Ofcom has issued general guidancesetting out the procedure for drawing upand revising the content of the Codes,Ofcom cannot specify particular terms to beincluded in agreements to which theguidance relates. Ofcom always has toensure that guidance for the purposes ofsection 285 is published and it must consultthe PSBs, persons who make independentproductions (or those who represent them),the BBC and the Welsh Authority beforeissuing or revising the guidelines.

The Codes were drafted by the PSBs andsubmitted to Ofcom for review last year.They have now all been approved byOfcom and will be supplemented bydetailed terms of trade to be prepared bythe PSBs.

Each of the Codes provide provision for the following:

• a reasonable timetable for thenegotiating an entering into of bindingagreements between PSBs and Indies;

• that there is (in Ofcom's view) claritywhen an independent production iscommissioned about the differentcategories of rights to broadest orotherwise make use of or exploit thecommissioned production that are beingdisposed of;

• transparency as to payment in respectof each category of rights;

• satisfactory arrangements are made forthe duration and exclusivity of rights;

• procedures exist for reviewingarrangements adopted in accordancewith the code, monitoring application ofthe code and also demonstratingcompliance with it; and

• procedure for resolving disputes.

The various Codes differ in certain areas.For example, the BBC is the onlybroadcaster to explicitly adopt a mediationroute in relation to dispute resolution.However, all of the Codes include thefundamental tenets set out above. TheCodes do not prevent the PSBs frombenefiting from the earnings produced fromsecondary rights in programmes made bythe Indies. However, whereas previously allintellectual property rights were owned bythe PSBs, the Indies will now licence rightsin the programmes and maintain controlover the distribution of secondary andancillary rights. How this will operate inpractice obviously remains to be seen.

So what does this mean for

Indies and PSBs?

As indicated above, until the Codes have

been in use for a period of time and the

terms of trade agreed, it is impossible to

give a definitive view. Having said this,

Pact (the UK trade association that

represents and promotes the commercial

interests of independent feature film,

television, animation and interactive media

companies) submitted an "Impact

Assessment Report" (the "Report") to

Ofcom regarding potential effects of

changes in rights ownership which

provides some assistance in predicting the

likely impact. The Report concluded that

the cost of a transfer of value from the

PSBs to the independent sector will be

around £36 million, which is not

insignificant for the Indies. It is worth noting

that this transfer in value primarily relates to

the BBC and Channel 4, with the report

projecting a loss of £25 million to the BBC,

£19 million arising through the loss of rights

and £6 million through extra payments to

Indies for showing repeats of their

programmes. This would be counteracted

by some savings the BBC would make in

administrative areas. ITV only retains

primary rights to commissioned

programmes in any event and so should

not be affected in terms of rights

ownership although other provisions of the

Codes still likely to impact.

We, of course, will have to wait and see

how the newly approved Codes are put into

practice and ultimately enforced to see if

there really will be a rebalancing of power

between the Indies and PSBs. Now that

the Codes are finalised, it will be essential

for Indies and PSBs alike review their

contractual terms to ensure that the

provisions of the Codes, in particular

regarding ownership of intellectual

property rights and their exploitation

beyond the first broadcast, are adequately

dealt with.

Indies - Keeping the Crown Jewels?


But A Royal Duty is in fact other people’sstories in their own words. Punchlines ofletters from the Duke of Edinburgh andDiana are quoted; intimate conversationswith the Queen are served up, like ratherfusty slices of Battenburg cake. The daysof restraint for insubordination or generalbad attitude to the monarch are long gone.Even in 1763 George III’s arrest of JohnWilkes for seditious libel ended in acquittal.Can the law do nothing to stop thisinsurrection in the fourth estate?

There were two effective legal weapons inthe royal armoury: copyright andconfidentiality. Copyright in letters remainswith their author unless it has beenassigned in writing or licensed to someoneelse. The physical possession of lettersdoes not give any right to publish theircontents, so the Duke of Edinburgh retainsrights in his letters and Princess Diana’sestate has rights in hers. A copyrightowner can sue if someone publishes asubstantial part of one of their letterswithout permission. The courts are alsoswift to grant injunctions before publicationin this area in which there is only a verylimited public interest defence.

If you want to stop publication, copyright iseven more effective than confidentialityalthough the betrayal of employers’confidences by servants continues to beviewed very strictly by the courts. Withinthe last year, both Naomi Campbell andLady Archer have successfully sued theirformer personal assistants and beengranted permanent injunctions blockingfurther betrayal of personal secrets.Appropriately enough, this area of the lawis built on the case of Albert v. Strange. In1848, the year of revolutions in continentalEurope, Prince Albert and Queen Victoriasuccessfully sued an upstart printer toprevent him from running off pirate copiesof their family sketches of each other, theirchildren, assorted family and pets.

Why, then, did the Royals not try to stop Burrell, the Mirror or Penguin?Copyright law was on their side.The extracts were short, but although it is widely believed you can publish aproportion of a work without consent,the issue is not length but substance:a key line from a long work can besubstantial and therefore infringing.None of the other fair dealing defences toinfringement of copyright applies: theycover reporting current events, criticism orreview and private study; in any event thefair dealing defence no longer applies tounpublished personal letters.

The extract from the Duke of Edinburgh’sletter in which he reveals his belief thatCharles would be mad to leave Diana forCamilla was obviously substantial.

There is little doubt that the extracts usedby Burrell were actionable breaches ofcopyright. It was also obvious that many ofBurrell’s revelations were in breach ofconfidence too. To put it the other wayround, if the Mirror owned exclusive rightsin the underlying material they would seerival publication of these extracts as aspoiler worth stopping.

Previously the Royals have sued, often withsuccess. Diana famously sued the ownerof her gym for allowing photographs to betaken without permission. Her estate suedthe Franklin Mint for using her name andimage, incurring costs of many millions ofpounds. James Hewitt’s mawkish “Princessin Love” took the safe course and escapedlitigation by merely paraphrasing Diana’slove letters; although indelicate, its partswere therefore less than substantial.

The Butler Did ItIf Paul Burrell had written a book about his life as a royal butler in his own words itwould have been unremarkable in a legal sense.


As a result, brand promoters need to take aclose look at the wording that they use atthe point of collection of any personal datain order to ensure that the necessaryconsents are obtained to be able to usesuch data in unsolicited direct marketingactivities in the future.

The Privacy and ElectronicCommunications (EC Directive) Regulations2003 (“Regulations”) came into force on11 December 2003. Amongst other things,the Regulations deal with the sending of“spam”. Spam is a word that is commonlyused to mean unsolicited commercial emailand the Regulations have introduced a newrule that unsolicited direct marketing emailsmust not be sent to individuals unless theyfall within what is known as the “soft opt inexemption” or unless they have consentedto receive them. Consent can be (but doesnot have to be) given by means of a “tickbox” whereby the individual opts in toreceive direct marketing by email from thepromoter in the future.

“Soft opt in exemption”

The “soft opt in exemption” provides thatunsolicited direct marketing emails can besent to individuals without first obtaining theprior consent of those individuals where:

• the recipient’s email address has beenobtained in the course of a sale ornegotiations for sale of a product orservice to that recipient; and

• the sender’s direct marketing material isin respect of similar goods or services;and

• the recipient has been given a simplemeans of refusing (free of chargeexcept for the cost of transmission) theuse of his contact details for marketingpurposes at the time those details wereinitially collected and, where he did notrefuse the use of those details, at thetime of each subsequentcommunication.

To understand how this works in practice,consider the example of a company whichcollects email addresses from consumerswhen they place an online order for aproduct. In this situation the consumer’semail address will be obtained in thecourse of a sale and so if the online orderform contains appropriate data protectionwording (which provides an opt outopportunity such as a tick box so that theconsumer can opt out of receiving futuredirect marketing emails) then that companycan send direct marketing emails to that

consumer about its other similar productsin the future provided an opt out opportunityis included in each subsequent email.

Existing mailing lists

What does this mean for mailing lists ofindividual email addresses that werecompiled before 11 December 2003? Donot panic - the enforcer of the Regulationsis the Information Commissioner and hehas taken the view that where such mailinglists were compiled in accordance withprivacy legislation in force before 11December 2003 and have been usedrecently, they can be continued to be usedunless the recipient has already opted out.However, an opportunity must be providedfor recipients to opt out of receiving futureunsolicited direct marketing emails in allsubsequent messages.

Corporate subscribers

There are different and less restrictive rulesfor sending spam to recipients who are notindividuals but are “corporate subscribers”.To fully understand the rules on spam, youneed to understand this difference. Whilstan email addressed to Fred Bloggs at hisresidential address would be an email to an

New Rules on SpamThe rules governing the way in which brand promoters can conduct unsolicited directmarketing in the UK have recently changed.

When Wendy Berry, the formerhousekeeper at Highgrove House, flutteredover the hedge as author of “TheHousekeeper’s Diary” Prince Charles gaveher both barrels. Her book remainsunavailable in this country and Berry facesimprisonment if she returns to England.

So why did they hold their fire this time,when they had a strong case? Assumingthat they were not simply looking the wrongway when Burrell broke cover, why did theyignore not only a good chance of suing butalso of blocking publication? The answer isalmost certainly not in the law.

Penguin and the Mirror will have beenexpertly advised on their legal position.

They will also have remembered LordNorthcliffe’s words: “news is whatsomebody somewhere wants to suppress.All the rest is advertising”. Above all, theywill have remembered the collapse of PaulBurrell’s trial for theft almost exactly a yearago as a result of the Queen’s intervention.Looking back at the public reaction to thatfiasco the publishers may well havedecided that the Royals could not riskanother last-minute legal run-in. They mayhave concluded that although the law mightnot favour publication of what the butlersaw, tactics did.

The royal patience finally ran out when the Mirror published the revelations of its

fake footman during George Bush’s visit toBuckingham Palace. Although it wasagreed that some of the information was inthe public interest, the newspaperaccepted that much of it was not. Aftersplashing two days of inside gossip itagreed to publish nothing more, to returnunpublished material and make acontribution to the royal costs. Some sawthis as too little too late. It’s no goodshutting the kennel door after the corgishave bolted.

(A version of this article was previouslypublished in Media Guardian.)


individual subscriber, an email to anemployee of a UK limited company ([email protected]) would be anemail to a corporate subscriber. On theother hand, an email addressed to anemployee of a non-limited liabilitypartnership in England is classified as anemail to an individual subscriber whereasan email addressed to an employee of apartnership in Scotland is classified as anemail to a corporate subscriber.

This difference is important because priorconsent is not a prerequisite to sendingemails to corporate subscribers.

Of course, the Regulations do not onlyconcern spam - they also contain rules onunsolicited direct marketing by other meanssuch as telephone, fax and text message.

Mind the CAP

Advertisers and promoters in the UK mustnot only take notice of the changesrequired to their direct marketing practicesunder the Regulations, they must also beaware of the provisions of the British Codeof Advertising, Sales Promotion and DirectMarketing (“CAP Code”). The CAP Codeis not the law but is a self regulatory codewhich is designed to help marketerscomply with the law. We have referred tothe CAP Code and its application inprevious editions of Convergence but it isworth noting here that the CAP Codebroadly reflects the Regulations in that itincludes a requirement for advertisers andpromoters to obtain explicit consent fromconsumers before sending marketingcommunications by fax, email or textmessage. There is an exception whichapplies where similar products are beingmarketed to existing customers.

The ASA has already upheld a number ofadjudications on this section of the CAPCode. One final point for promoters tonote is that, whilst under the Regulationsan unsolicited direct marketing emailaddressed to [email protected] be an email addressed to acorporate subscriber and could be sentwithout obtaining the prior consent of FredBloggs, CAP takes the view that such anemail cannot be sent to Fred Bloggs in hisprivate capacity (e.g. to market a consumerproduct) without his prior consent unlesshe is an existing customer.

Therefore, if you are intending to conductunsolicited direct marketing activities byemail, ensure you appreciate thedifference between the rules on sendingsuch emails to “individual subscribers” and“corporate subscribers” and do not forgetthe CAP Code.

“Spam is a word that is commonly used to meanunsolicited commercial email and the Regulations have introduced a new rule that unsolicited directmarketing emails must not be sent to individuals unless they fall within what is known as the “soft opt in exemption” or unless they have consented to receive them”.

DLA is an international law firm and part of the DLA Group

DLA is a registered trademark in the UK

The partners are either solicitors or registered foreign lawyers and a list of their names and qualifications is open for inspection at 3 Noble Street, London EC2V 7EE.

Regulated by the Law Society.

DLA Group offices: United Kingdom, Austria, Belgium,Bosnia-Herzegovina, China, Croatia, Czech Republic,Denmark, France, Germany, Hong Kong, Hungary, Italy,Netherlands, Norway, Russia, Singapore, Slovakia,Spain, Sweden, Thailand.

A list of all offices is available on www.dla.com.

UK switchboard:+44 (0)8700 111 111

Web address:www.dla.com

Ref: DLA 7494/01.04

Brussels

Patrick Van Eecke joined DLA in September2003 and will be leading our Internet LawGroup in Brussels. Patrick joined fromBogaert & Vandemeulebroeke along withRosa Barcelo and Georgia Skouma.Together Patrick, Rosa and Georegia will be focussing on electronic signatures,encryption, data protection, e-commerceand e-government.

Pierre Bruwier also joined in September2003 and his work covers both informationtechnology and intellectual property.

Manchester

Elizabeth Murray joined in November 2003and will be focussing on public sector ITprocurement projects. Elizabeth joined usfrom Service and Systems Solutions Limited(Sx3) where she was Legal & CommercialDirector of the Infrastructure & ManagedServices Division. Sx3 provided IToutsourced and managed services, complexmulti-tier CRM implementations and highend technology infrastructure solutions tolocal authorities and London Boroughs.

Prior to that, after a spell in private practicewith Garretts, Elizabeth spent 7 years atLloyds TSB Bank plc where she led GroupIT Legal & Supplier Planning before beingpromoted to Head of Strategic Alliances ineCommerce.

New Joiners

DLA advises the Department of Health on the National Programmefor IT, the world's largest IT project

Editor: Simon Jones

Contributors: Annabel Ashby, Craig Armstrong, Siân Croxon, Ruth Daniels, Zoe Ham, Selina Taylor, Mark Lawry, Mark Smalldon, Suzanne Streatfield.

DLA was jointly appointed with Allen & Overyby the Department of Health to advise on theNHS National Programme for IT, the world'slargest IT project, which has been procuredwithin an unprecedented timescale.

Once implemented, the NHS Care RecordsService will make a difference to everyman, woman in child in England byproviding all fifty million NHS patients withan individual electronic NHS Care Record,which will detail key treatments and care.For the first time, information about patientswill be mobile - just like patients themselves- and not remain in filing stores in thebuildings where treatment or care has beenreceived. The Service will connect morethan 30,000 GPs and 270 acute,community and mental health NHS trusts ina single, secure national system.

The overall procurement was split into eightrelated projects for the creation of a NationalCare Records Service, Network Services, anElectronic Booking Service and five separatecontracts for the provision of Local ProviderServices. DLA was given responsibility forfive of these high profile projects. A teamfrom DLA (led by TMC partner Lee Brierley)advised on the procurement of the £50million Electronic Booking Service, whichwas concluded in Autumn of 2003.

More recently, DLA was responsible foradvising the Department of Health in theaward of the following contracts:

• the creation of the National Care RecordsService (awarded to BT on 8 December2003)

• the provision of Local Provider Services inthe London region (awarded to BT on 8December 2003)

• the provision of Local Provider Services inthe North West region (awarded to CSCon 22 December 2003)

which, together, were worth almost £2.6 billion.

The DLA team for the legal delivery was ledby Richard Bonnar. Richard was supportedby fellow TMC and C&P partners SimonJones, Nick Ogden, Craig Rattray and MarkVipan in successfully delivering the CareRecords Service, London LSP and NorthWest LSP contracts to a highly challengingand exacting timetable. Between them theyco-ordinated DLA's legal teams who assistedin the drafting and negotiation of the Termsand Conditions; wide reaching projectmanagement, procurement and strategydevelopment responsibilities; and extensiveliaison within the vast client organisation andwith Allen & Overy. The teams themselveswere drawn from members of both the C&Pand TMC Groups in DLA's Leeds, London,Birmingham and Edinburgh offices andincluded John McKinlay, Fiona Mares,Stewart James, Catrina Brazier, Dan Brunton,Craig Armstrong, David Cunningham,Natalie Shingler, Siobhan Mullens, StephenJohns, Kim Broadbent, Laura Shinger andClaire Daly.

Guy Lamb and Sarah Day providedinvaluable assistance in their niches ofEmployment and Banking respectively.

Uniquely, DLA played a key role in theprovision of procurement support. BrianClark was Procurement Director for theElectronic Bookings Project and wassubsequently seconded on to theProcurement Executive of the NationalProgramme. Brian was supported by StevenNorris (Regulated Procurement), RachelSherratt, Victoria Lamb, Claire Daley andLaura Shingler.

Finally, on 19 February 2004, the Departmentfor Health announced the award to BT of amulti-million pound contract to procure,integrate and manage networking servicesfor the new national network (known as N3)for the NHS. Mark Crichard led the DLAteam in advising the Department of Health.In so doing, Mark was supported on theproject by Purvi Parekh, Fiona Mares,Stewart James, Hazell Honour, DavidWilliams, Hinal Patel and Leona Marshman.

The innovative N3 multi-supplier network isthe first of its kind in the public sector.Under the contract BT are required tosource and provide services to cater forboth the NHS and other associated publicand private bodies. The contract is uniquein that it is structured to provide theflexibility to grow with the NationalProgramme for IT and the NHS and adaptto new demands and technology.

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