Growing plans

The Scottish Ministers recently published a consultation paper on proposals to strengthen the Scottish Planning System to help support sustainable economic growth.
The Ministers had previously appointed an independent panel and in May of last year that panel published its report: the recent paper is part of the response and ongoing consultation.
The proposals are wide-ranging, but specific aspects of the existing system have been identified as requiring reform, including removing the “strategic development plans” and making significant changes to the local development plans. A major focus is on putting measures in place to increase community involvement in proposed developments, while trying to impose as much of the cost of this as possible on to the development companies.
There are also suggestions to councils of ways to speed up development to meet demand, including making more publicly owned land available for development.
In line with other legislative changes, another major element of the proposals is to increase transparency when it come to infrastructure funding. There is a general proposal to allow for an infrastructure tax for Scotland, with income collected at the local authority level.
There is also focus on the costs involved in the planning system itself, with the Ministers indicating that the goal should be to make the system self sustainable, with mechanisms in place to allow it to recover its own costs.  This will be achieved by allowing for higher fees for applications, charging for appeals and allowing for fast-tracked applications in exchange for higher fees.
The consultation paper is at this stage quite high-concept, and vague on the detail of how the goals will be arrived at.  However, developers and other stakeholders will need to be aware of the proposals and the ongoing consultation process which will inevitably flesh things out.

 

Data Protection and Brexit – Are you ready for the General Data Protection Regulation?

 

As of 25 May 2018, the UK Data Protection Act 1998 (DPA) will be replaced by new legislation which will apply across the EU, primarily comprising the General Data Protection Regulation (GDPR).

The UK Government has confirmed that the UK’s decision to leave the EU will not affect the commencement of the GDPR.

This means that businesses and public bodies across the UK and the EU will have just over a year to make sure they are compliant with the new rules imposed by the GDPR.

The UK Information Commissioner gives the following guidance on the significance of the GDPR:

  • The GDPR applies to ‘controllers’ and ‘processors’. The definitions are broadly the same as under the DPA – i.e. the controller says how and why personal data is processed and the processor acts on the controller’s behalf. If you are currently subject to the DPA, it is likely that you will also be subject to the GDPR.
  • If you are a processor, the GDPR places specific legal obligations on you; for example, you are required to maintain records of personal data and processing activities. You will have significantly more legal liability if you are responsible for a breach. These obligations for processors are a new requirement under the GDPR.
  • If you are a controller, you are not relieved of your obligations where a processor is involved – the GDPR places further obligations on you to ensure your contracts with processors comply with the GDPR.
  • The GDPR applies to processing carried out by organisations operating within the EU. It also applies to organisations outside the EU that offer goods or services to individuals in the EU.

This is particularly important if your business transfers personal data outwith the EU – you will need to confirm that the process of transferring the data is compliant with the new regulations.

  • The GDPR does not apply to certain activities including processing covered by the Law Enforcement Directive, processing for national security purposes and processing carried out by individuals purely for personal/household activities.

What information does the GDPR apply to?

  • Personal Data – this definition is similar to the DPA, which is data that can identify the identity of an individual whether directly or indirectly, for example, their name, date of birth, address etc. The GDPR will expand on this to include online identifiers such as an IP address
  • Sensitive Personal Data –  this is similar to the DPA, and includes, racial or ethnic origin, political opinions, religious and philosophical beliefs, trade union membership, health or sex life and will now include genetic or biometric information which when processed can indentify an individual

So remember to get your systems ready for the GDPR by 25 May 2018.

Corporate and business

Going into business together? Get a Shareholders’ Agreement

Let me tell you a story of two individuals (A and X) who formed a beautiful working relationship and decided to go into business together.

They incorporate the company, appoint themselves as directors and take a 50/50 shareholding each.

All goes well for the next few years, profits are growing and their client base blooms.

Then, over time, cracks begin to form in the working relationship, things aren’t working out anymore and eventually the situation becomes unbearable meaning working together is impossible.  A wants to buy X out of the company, but X refuses to sell, or cooperate.

A seeks advice from a lawyer, and is asked – is there a shareholders’ agreement? The answer is of course no. There is no agreement on the valuation of shares, and A cannot terminate X’s directorship.

After a long-drawn-out dispute, with the business’s future being put in jeopardy, A and X agree a settlement, with vast sums, going on lawyers and court fees.

If you are starting up a new business, you may think a shareholders’ agreement is just an extra expense which you don’t really need – which is understandable when you are juggling other costs for your business. However, after seeing many clients learn the hard way, and waste so much time and money in resolving deadlock disputes, we cannot stress how important it is to get things right at the beginning.

It may be that things are working well for you in the present, but you cannot predict what the future holds. Protecting your position by planning is the best way to avoid a commercial disaster.

Is your trademark a popular word or phrase?

A recent ruling by the Court of Session in Edinburgh highlights the difficulties businesses face registering popular words and phrases as trademarks .

Tartan Army Ltd v Sett GmbH and Others [2017] CSOH 22 concerned a long-running dispute between retailer Tartan Army Limited (“TAL”) and a football magazine publisher, Alba Football Fans Limited (“AFF”).

 

The match

TAL registered EU and UK trademarks for their trademark  ‘Tartan Army’ for their merchandise, clothing and other products in 1996.

TAL accused AFF of passing off, claiming that AFF infringed their rights by publishing ‘The Famous Tartan Army Magazine’ aimed at Scottish football fans.

TAL requested an order prohibiting AFF from infringing its rights – along with destruction of all promotional and printed material bearing the ‘Tartan Army’ trademark.

AFF counterclaimed that TAL’s trademarks were ‘invalid’, as the phrase ‘Tartan Army’ had widely been used as a collective noun for Scottish football fans since the 1970s. AFF claimed that TAL were attempting to “commandeer and monopolise well‑known words or phrases which they did not invent and which had a very well‑known and widespread meaning which was not distinctive of trade origin”. AFF’s supporting witness statements included a number of well-known football personalities in Scotland, including former Scotland national team manager Craig Brown, commentator Archie MacPherson and journalist Chic Young.

 

The result

Lord Glennie, IP judge in the Court of Session rejected:-

  • AFF’s challenge that TAL’s trade marks were invalid.

He said: “The fact that the term is often used as a badge of allegiance, in this case to the Scotland football team and its fans, does not prevent it being registered as a trademark”.

  • TAL’s claims that AFF was liable for trademark infringement and passing off.

He said the title of AFF’s publication was not identical to the ‘The Tartan Army’ mark and that, despite being similar, TAL had failed to show there was a “likelihood of confusion on the part of the public” between AFF’s use of the mark and its own. “The evidence does not suggest that anyone becoming aware of the Magazine would associate it with TAL or any of TAL’s products bearing the words Tartan Army.  Nor does it seem to me to be likely that there would be any such confusion.”

  • TAL’s argument that AFF had been “free-riding” on the reputation of its mark.

TAL failed to show that their trademark had a reputation in the UK which had been taken unfair advantage of by AFF. Lord Glennie said: “Certainly TAL’s trademark is distinctive otherwise it would not be validly registered but I do not accept that it has a particularly strong distinctive character.  There was no substantial body of evidence to suggest that it was widely known amongst the mass of the Scotland football supporters.  Even if it were more widely known than it is, the lack of confusion is a factor of some importance. Unless there were a possibility of confusion, or perhaps more accurately association, between the two marks, there would be little risk of diversion, tarnishment or freeriding.”

Lord Glennie ruled that AFF’s popular magazine did not infringe the trade mark of retailer Tartan Army as football supporters and consumers would be unlikely to “associate” AFF’s magazine with the merchandise sold by TAL:

I consider that most potential customers or consumers, being Scotland fans or, to put it another way, members of the tartan army, would understand the name of the Magazine to refer to them (and the Magazine to be for them) rather than as a reference to TAL or its products….In those circumstances the claim in passing off fails“.

Lord Glennie found that there was no infringement nor passing off and ruled to reduce the scope of TAL’s trademark rights after determining that there had been no “genuine use” of the trademarks for some classes of goods, including flags, bunting and banners, and wall hangings.


What does this mean for your business?

The ruling shows that well-known words and phrases can be registered as trademarks. However, businesses wishing to make use of those marks cannot assume that those common terms are in the public domain and free to exploit.

Businesses need to be able to show that the public link the use of their mark with their brand. However, there is an inherent challenge in doing so where the words concerned are in common use and have broader associations than to just the goods or services for which the trademark is registered. Without that link being established, businesses are unlikely to be able to show that there is a reputation in their trademark which has been sullied by others’ use, or that they have sufficient goodwill built-up to sustain claims of passing off.

Reclaiming Song Copyrights

The US Copyright Act 1976 (“the Act”) gives artists the right to reclaim ownership of the copyright in works assigned by them prior to 1978.

The Act states that an artist may terminate all agreements for the grant, licence or transfer of US copyright entered into before 1978 by serving notice upon the assignee or licensee 56 to 61 years after the date on which the copyright was originally secured.

Although many well known artists have successfully taken back ownership of their rights in the US by relying on this statutory provision, Duran Duran were sadly denied this opportunity when they attempted to reclaim the rights to 37 of their songs from Sony/ATV Music Publishing LLC (“Sony”) at the High Court of Justice in England. The claim failed due to a lack of evidence that the Act would override the terms of their publishing agreement with Sony which was governed by English law.

The case confuses the position for British songwriters as it creates a situation where a US court could decide that US rights revert to the artist under the provisions of the Act, but an English court could find that this reversion constituted a breach of the publishing agreement, giving rise to a claim for damages for breach of contract against the artist.

On 18th January 2017, Sir Paul McCartney filed a claim in the US against Sony for a declaratory judgement in order to clarify whether his publishing rights will revert to him in accordance with the Act. Mr McCartney is asking the court to declare that in invoking the provisions of the Act and reclaiming the copyright in the Beatles songs, he will not be in breach of the terms of his publishing agreement. If successful, he will be able to reclaim his US copyright in a number of songs he wrote and co-wrote with John Lennon between 1962 and 1971.

What does this mean for UK artists and publishers?

Publishing agreements need to be properly drafted and sufficiently detailed in order to provide for the effect of various copyright laws around the world.

Artists, bands and songwriters should ensure that they receive specialist legal advice on the terms of their publishing agreements as they may contain long term implications.