EU Tax, Cisco, Google, Burger King: Intellectual Property

European Union nations that offer “patent box” tax breaks should retool their laws so that only deserving companies can claim benefits tied to technical innovations, according to a draft report from a European Union working group.

Countries that use this kind of technology tax break should start legislative work next year on redesigning their rules so they can phase out the old system, according to the report, which will be discussed by EU finance ministers on Dec. 9. The group recommends that existing tax breaks be closed to new entrants as of June 30, 2016, followed by a total shift to revamped rules by mid-2021.

The goal is to ensure that governments don’t grant tax breaks on patent income for technology developed outside their jurisdictions. The working group recommends that the EU adopt a version of the “modified nexus” approach developed by the Organization for Economic Cooperation and Development.

Patent-box reviews are part of a global clamp-down on corporate tax-avoidance as governments struggle to increase revenue and reduce deficits. Germany, France and Italy have led calls for EU nations to align tax policies so companies don’t escape duties by setting up shop in sympathetic nations.

None of the EU’s existing patent-box tax breaks complies with the new standard, according to the EU panel, known as the Code of Conduct Group on Business Taxation. It wants countries to start next year on legislative work to adopt the new standard for research and development-based tax breaks.

Patent Suit Defense Gets U.S. High Court Review in Cisco Case

The U.S. Supreme Court agreed to use a case stemming from a $64 million award against Cisco Systems Inc. (CSCO) to consider making it easier to win some types of patent lawsuits.

The justices said Dec. 5 that they will hear an appeal from Commil USA LLC, which is accusing Cisco of infringing a patent that covers wireless-transmission technology. Commil won a jury verdict against Cisco in an earlier round in the litigation.

The case centers on claims of inducing infringement — that is, creating a product that leads someone else to violate a patent. The question is whether an accused company can defend itself by arguing it had a good-faith belief the disputed patent was invalid because the invention was obvious, vague or insufficiently novel.

Cisco, based in San Jose, California, is the biggest maker of networking equipment.

The case, which the court will decide by June, is Commil v. Cisco, 13-896.

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Copyright

Google Seeks to Avoid Paying Authors to Scan Their Books

Google Inc. urged an appeals court to uphold its victory in a court challenge to its project to digitally copy millions of books.

A lawyer for the world’s biggest search-engine company called the project “incredibly transformative,” arguing its mission to help people find books online makes Google’s display of parts of the books a “fair use” under copyright law.

The lawyer, Seth Waxman, urged a three-judge panel of the federal appeals court in Manhattan last week to uphold a ruling that dismissed a copyright suit by writers including Jim Bouton, the former New York Yankees pitcher who published “Ball Four” in 1970.

A ruling in Mountain View, California-based Google’s favor may help it retain its dominance in online searches.

Paul Smith, a lawyer for the Authors Guild, called the Google project “quintessentially commercial in nature” and intended to advance the company’s business interests. Smith said Google Books violates authors’ rights to control their works.

The Authors Guild sued in 2005, alleging that Google infringed copyrights by scanning and indexing books without writers’ permission. Judge Denny Chin ruled in November 2013 that Google Books provides a public benefit and doesn’t harm authors. Chin, a judge on the appeals court, isn’t participating in the review of his decision.

Chin’s ruling came more than two years after he rejected a proposed $125 million settlement in the case.

In June, the appeals court ruled that a group of university libraries can make digitized books available for use to the disabled, and for word searches, without permission from the authors. The court agreed that the group, HathiTrust Digital Library, is engaging in a fair use of the copyrighted works.

The suits are part of a broader challenge by copyright holders to attempts by Google and other companies to allow users to search and read portions of the works for free.

The case is Authors Guild v. Google Inc. (GOOG), 13-4829, U.S. Court of Appeals for the Second Circuit (Manhattan).

For more copyright news, click here.

Trade Secrets/Industrial Espionage

Kentucky Teachers’ Pension System Won’t Reveal Contract Details

Kentucky’s Teachers Retirement System refused to disclose to the state’s educators the details of its agreements with firms managing the investments, according to the International Business Times.

Responding to an inquiry from a teacher, the system’s general counsel, Robert Barnes, said the contract terms are trade secrets that must be kept confidential to protect the competitive positions of the investment companies, the online newspaper said.

Other states where similar requests for information have been rejected include Illinois and Rhode Island, according to the publication.

Jim Wayne, a Democratic member of the state Legislature, said he will introduce measures that would subject such agreements to disclosure mandates, the Business Times said.

Trademark

Indian Company Seeks Cancellation of Burger King Marks

Burger King Corp. is facing a potential trademark challenge in India, the Business Standard newspaper reported.

The Delhi High Court has ruled that an Indian company, Burger King Restaurant Pvt. Ltd., may ask India’s Intellectual Property Appellate Board to cancel Burger King Corp.’s trademark registration on the grounds that it hadn’t been used, according to the newspaper.

Burger King Corp. filed an infringement suit in August, claiming the Indian company had surreptitiously registered “Burger King India” as its name, according to the Business Standard.

Instead of hamburgers that are the backbone of the U.S. company, the Indian Burger King is focused on vegetarian cuisine, the newspaper reported.

DuPont Persuades Court to Reconsider ‘Nomex’ Registration

DuPont Co. (DD), the U.S. chemical company, persuaded India’s Intellectual Property Appeal Board to reconsider the registration of its “Nomex” trademark by an Indian medical products company, the Financial Express reported.

The board said the registration was “a gross violation of principles of natural justice” and needed to reviewed, according to the newspaper.

Previously, Galpha Lab Ltd., a Mumbai-based distributor of medical equipment, had registered “Nomex” for use with pharmaceutical products, despite DuPont’s objections, the Financial Express reported.

DuPont, of Wilmington, Delaware, has registrations of the term for a number of classes of goods in India, including yarns and threads, fabrics, cordage and fibers, rubber goods, paper goods and printed material, according to the newspaper.