NEWS Rosetta Stone ruling leaves Google exposed
Google has suffered a setback in the keywords dispute with Rosetta Stone after a US court overturned much of a decision favouring the Internet powerhouse.
The US Court of Appeals for the Fourth Circuit largely disagreed with a Virginia district court, which had said Google did not infringe Rosetta Stone’s trademarks by selling them as keywords that triggered sponsored links.
Rosetta Stone, which provides language-learning soſtware, filed a lawsuit in 2009 for trademark infringement. In August 2011, the US District Court for the Eastern District of Virginia ruled in favour of Google and dismissed all of Rosetta Stone’s trademark claims.
But on April 9, 2012, the Fourth Circuit remanded three of those claims: direct trademark infringement, contributory infringement and trademark dilution. The remaining two are vicarious infringement and unjust enrichment.
Te functionality doctrine, which prevents trademark protection from extending to the functional features of a product or packaging, was the central area of disagreement. Te district court said keywords containing trademarks
were functional when entered into Google’s search engine, partly because they provided an indexing function for Google. But the appeals court disagreed, saying the functionality doctrine “simply” did not apply. It said the district court failed to consider whether the Rosetta Stone marks were functional as the company used them.
Nick Rose, a partner at Field Fisher Waterhouse LLP, said: “This is good news for trademark owners because it means that infringers will not be able to fall back on the functionality defence where they claim that their use of someone else’s well-known trade
mark is useful or beneficial in some way, or allows their business to operate better, thereby allowing them to avoid liability.”
Concerning trademark dilution, the appeal court said the district court had used the wrong legal standard. It said only a likelihood of dilution was required—not an actual economic loss or reputational injury, which had been relied on.
The case has been remanded back to the district court, which must reassess Rosetta Stone’s claims over direct and contributory infringement, as well as it's dilution claim. n
Polish medicinal legislation contravenes EU directive
The Court of Justice of the EU (CJEU) has ruled that Polish legislation allowing the sale of unauthorised foreign medicines does contravene EU law.
In a decision dated March 29, 2012 the court ruled that approving the goods, which were cheaper than, and similar to, authorised products, breached Directive 2001/83.
Under the directive, medicinal products cannot be sold in EU member states unless they are approved by either the relevant national authorities or the European Medicines Agency. A harmonised policy enables cost-efficient and fair market access, and protects public health, according to the court.
The CJEU stressed that such medicines should be imported only in exceptional cases—such as where patients require them for “special medical needs”. But this should be only when urgent medical care is required and the relevant medicinal product is either unauthorised or its legitimate equivalent is unavailable.
Poland argued that selling cheaper, but unauthorised, products should be allowed
owing to financial considerations such as ensuring the financial stability of the national social security system, and allowing patients with limited finances to use the treatment.
But the court rejected the arguments. It said the legislation introduced an exception to the rule—based not on medicine being
8 World Intellectual Property Review May/June 2012
unavailable, but on unauthorised products being sold at lower prices than their equivalents. The directive does not legislate for the organisation of a national health care system or its financial ability, the court said.
Poland has therefore failed to fulfil its obligations under EU law. n
www.worldipreview.com
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