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Advice from professionals on how to protect intellectual property rights in science and the arts

DAMIEN CARRICK: Hello and welcome to the Law report. I'm Damien Carrick. I'm sitting in for Susanna Lobez who's out in the field collecting stories.

Today, the Law report looks at intellectual property law, both in the sciences and in the arts.

We'll be talking to some patent attorneys. They are the people who have the job of ensuring that lawyers don't get blinded by science. And we'll also be looking at how the law deals with art in the electronic age, whether it be film, multimedia, or art on the Internet.

But first, Susanna Lobez speaks with three patent attorneys about how they manage to straddle the great divide between science and the law.

SUSANNA LOBEZ: Fraser Old, President of the Institute of Patent Attorneys of Australia; Leon Allen, patent attorney at Davies Collison Cave in the ACT; and Ann Kurtz, a partner at Griffith Hack and Co in Sydney. Can I ask you all first of all, what are patent attorneys and what's their stock-in-trade?

FRASER OLD: Well, patent attorneys are a little bit like ear, nose and throat surgeons in that they only do patents, trademarks and registered designs. They are all engineers or scientists who have done courses in intellectual property law but, generally speaking, are not lawyers. So we're engineers and scientists who protect the intellectual property of our clients.

SUSANNA LOBEZ: So you really need to have both a knowledge of the law and the regulatory scheme, the registration scheme, plus the basic knowledge of the technology that's at hand. And I notice all of you, Fraser, your background is electrical engineering; Leon, you're a physicist; Ann, I understand you specialise in biotechnology.

ANN KURTZ: That's right, yes, and that's an area that you typically won't find most engineers dabbling in, because it's a very specialised technology.

SUSANNA LOBEZ: What actually is a patent, Fraser?

FRASER OLD: Well, I'd like to say a patent's a sort of reward provided by the government, and the reward takes the form of a limited monopoly and it's granted to people who introduce something new into the community.

SUSANNA LOBEZ: What kinds of things, Ann Kurtz, can be patented?

ANN KURTZ: There are two basic principles that are involved: one is a generic principle, but it has to be new and inventive; and the second is the types of technology that can be patented. There are very few limitations on actual types of technology that you can patent, but on the patentable side you've got everything from new gadgets - electronic, mechanical instrumentation, computers, chemicals, biotechnology-related inventions relating to genes, micro-organisms, gene therapies, methods of medical treatment - quite a broad range of technologies that actually can be captured.

SUSANNA LOBEZ: I understand that there was some controversy about whether or not Australia is one of very few countries who allow the patenting of therapeutic medical procedures, like a certain way of sealing a wound after surgery.

ANN KURTZ: We're not one of the few countries; there are some significant countries that don't permit that kind of technology to be protected, and the European region is notable in that regard. This is certainly protectable in the United States and in Japan, as well as Australia.

SUSANNA LOBEZ: And it must be in the area of biotechnology patenting that a lot of the policy issues come to the fore. When you look at the monopoly aspects of patenting there, you would start to wonder whether the monopoly is a good thing or a bad thing. What are your thoughts?

ANN KURTZ: That certainly is a hot area of debate at the moment, but I think that there are some important issues to bear in mind. The first is that a patent doesn't sort of grant you ownership over life forms or biological materials. It's a limited monopoly to get a return for the hard slog that's gone in and the large investment that's been put in to giving knowledge to the world-at-large.

SUSANNA LOBEZ: So when people start jumping up and down about genes of ethnic minorities from around the world being patented and genetically altered animals, and plant variety rights that are genetically interfered with, why are they getting so upset?

ANN KURTZ: I think, to a large extent it reflects a misconception of what's happening there. There is concern in some quarters that patenting genes is tantamount to sort of possession of people who exist and the genes that exist in their bodies. But typically, the way the law works, even now, is that a gene has to have something done to it before you can patent it. It needs to be isolated, identified, and a useful purpose created for it before you can actually start to talk about getting patent rights. So that this misconception that patent protection is tantamount to sort of gaining some sort of ownership over people or their genetic material, is actually not quite right.

SUSANNA LOBEZ: Leon, I imagine that part of your work comes when people come in saying they want to protect their design, their trademark or their invention; and the other part of your work comes when people say 'Somebody's stealing my design, trademark or invention'. Is that correct?

LEON ALLEN: Indeed. Probably half the work that any patent attorney does is in relation to enforcement of intellectual property rights of one form or another, or in acting in conflicts between competing interests, so that a party may have sought to establish protection for a particular product and for commercial reasons another person will say, 'Hang on a moment, we don't want to see that monopoly granted and we have reasons to back that up' and that goes into rather long proceedings to establish who is indeed correct and whether the patent should be granted.

SUSANNA LOBEZ: Do a lot of them end up in court?

LEON ALLEN: No, a very large number of patent matters are settled.

SUSANNA LOBEZ: When conflicts in cases arise, what role does the patent attorney play?

FRASER OLD: When you get into the legal process, you're faced with a situation where the solicitors and the barristers on both sides, and the judge or the judges, can't read the patent specification and understand it unless it's a very simple mechanical case.

If it's a chemical or electrical invention, it's necessary then to explain the invention first of all to the barrister and solicitor on your own side, and then the barrister gets up and has to explain it then to the Bench. So in the case which went to the Full Federal Court, C Com v Jei Jing, that case concerned how to enter Chinese characters into a computer using a Roman keyboard - the ordinary keyboard that we have with Roman letters on. So in order to explain this to the barrister and then have the barrister in turn explain it to the judge, I came up with the analogy of using capital Roman letters and explaining that each of those had a stroke, so the letter H, for example, would have two vertical strokes and then a horizontal stroke. By using analogies such as this, it was possible to explain how the letter H would be entered into the keyboard, essentially by pressing the first key to indicate a vertical stroke and then a second key to indicate a vertical stroke and then a third key to indicate a horizontal stroke.

SUSANNA LOBEZ: Another controversial case in which your firm, Spruson and Ferguson, I understand was involved at one stage, is the Rescare case which went to the Full Federal Court and then later to the High Court - this concerned the patenting of therapeutic medical procedures. Fraser, tell me about that.

FRASER OLD: This concerned a device which enabled air to be blown down the nose of someone who suffers from something called sleep apnoea.

SUSANNA LOBEZ: It was some kind of mask arrangement, as I understand it, Fraser.

FRASER OLD: Yes, the complete specification described a full nose mask, and the provisional specification described two small tubes which were inserted into the nostril and around which was applied some silicone rubber so that the silicone rubber formed a small mask on the end of the nose. And the Full Court said that the mask wasn't fully disclosed or fully explained in the provisional specification, but the judge in the first instance said that it was.

SUSANNA LOBEZ: Why did the case go to court in the first place, Fraser?

FRASER OLD: The case went to court because Rescare, who'd had the patent for 10 years or so, had a monopoly on the market and it then experienced some infringement by an American company who was prepared to take on the patent.

SUSANNA LOBEZ: And the linchpin element of the case was whether or not this little silicone blob at the end of the nose, that contained the tubes to blow the air into the nose, constituted a mask. And what did the judge at first instance at the Federal Court say?

FRASER OLD: Well, the judge in first instance in the Federal Court was Mr Justice Gummow and he found in favour of Rescare. There were two aspects to the patent: one, was the apparatus claims, the equipment; and the other was method claims to the general principle of the method of overcoming the symptoms of this disease. And the Full Federal Court found against Rescare in relation to the apparatus claims but somewhat inexplicably, dismissed the method claims in a single sentence. Most commentators find that very difficult because the method was the same, irrespective of what type of apparatus was being used.

SUSANNA LOBEZ: It was the air-in-the-nose method.

FRASER OLD: The air-in-the-nose method.

SUSANNA LOBEZ: It then went on to the High Court didn't it, Fraser?

FRASER OLD: Well, Rescare sought special leave to appeal to the High Court.

SUSANNA LOBEZ: On what issue?

FRASER OLD: On the issue of fair basing, in other words whether the apparatus claims in the complete specification were adequately supported by the description in the provisional specification. And unfortunately the High Court refused leave to appeal, notwithstanding that there'd been a Full Federal Court decision in the C Com v Jei Jing case, in which the opposite result was provided. So there was a clear conflict there between the two decisions and the High Court refused to look into the matter.

SUSANNA LOBEZ: Now, Justice Gummow himself is on the High Court, it could be a very interesting case that gets up to the High Court on special leave.

Well, let me thank you all: Fraser Old, Leon Allen and Ann Kurtz, all patent attorneys. Thanks indeed for talking to the Law report about, well, everything you want to know about patent attorneys and didn't know who to ask.

DAMIEN CARRICK: Of course intellectual property law is not just the concern of scientists and manufacturers.

This week, Melbourne is hosting Arts Law Week. It's a series of forums and seminars aimed at giving artists the low-down on how to uphold their legal rights.

One of the organisers is the Australian Arts Law Centre in Sydney. It's a community legal centre which provides legal and accounting advice to all sorts of artists throughout Australia, many of them aspiring young film-makers.

I spoke with the Centre Director, Julie Robb, about who gets copyright in films and why contracts, which clearly outline everybody's rights and responsibilities, are just so important.

JULIE ROBB: Copyright is a bundle of exclusive proprietary rights which are given in respect of certain categories of works. Essentially what they do is enable the owner of those rights to control how work is copied.

DAMIEN CARRICK: Now, I imagine with works - literary, dramatic, musical, artistic works - you only have one artist or one person involved a lot of the time. But with something like film it's infinitely more complex because you have inputs from a great number of people.

JULIE ROBB: That's right, in a film, in any collaborative work. The same applies these days to multimedia works. You may have a whole range of copyright owners. For example, the person who writes the novel which the fledgling producer reads and decides would make a great screenplay; the author of the novel may be a copyright owner, so will be the publisher of the novel, then the person who makes the adaptation of the novel into a screenplay will themselves be entitled to copyright protection as the author of this screenplay, a second literary work.

Any music that is used in the film, whether it exists already or is commissioned especially, will be protected by copyright; both the music as a musical work, lyrics as literary works, and the sound recordings, if they already exist, will be protected separately by copyright.

Any artwork which is used in a film will also be protected by copyright. There are also people, of course, who are crucial to the film-making process who don't own copyright -notably these are the actors and the director, neither of whom are given the protection of copyright because on those basic copyright principles, neither of them produce material to which copyright attaches.

There's a very often-used saying that copyright protects, not ideas but the expression of the ideas, and the expression of the ideas needs to be in material form, so performers and directors miss out but, of course, their contribution to the film-making process is crucial.

The producer themselves gets a copyright in the film as the person who has made the arrangements for making the film. And the way that the film industry generally works is that it's the producer who has to own or have the rights to all of the copyright material which the film comprises.

It's a very big task for a producer to make sure that they have all of the rights they need in all of that other material I've spoken about, what's called the underlying works, both to satisfy funding bodies and also most importantly to ensure that if their film becomes a surprise success - it seems to be a regular practice in the Australian film industry in the low-budget sector over the last 15 years - then in order to secure the interest of a distributor, they need to satisfy the distributor that they are reasonably immune from legal attack.

DAMIEN CARRICK: So you could have the situation where a distributor would be running scared from a potentially successful movie because they maybe being sued by, say, the screenwriter, musicians, or other people with copyright in the movie.

JULIE ROBB: That's exactly right. In the higher end of the market, what is absolutely common is that producers will take out E and O insurance, which is Errors and Omissions insurance. In the low-budget sector, taking out what is rather expensive insurance is not a realistic option. So it becomes all the more important for the low-budget sector to ensure that they use written agreements which are properly negotiated.

DAMIEN CARRICK: Now, have there been any examples of small-time directors finding themselves in hot water years down the track, as a result of not having clear-cut watertight agreements when they were young?

JULIE ROBB: There's actually a case going on in California at the moment, between a director who was young in 1967, when Steven Speilberg entered into a written agreement with a producer, Dennis Hoffman. Hoffman agreed to invest in Speilberg's first short film, called Amblin in return for Speilberg's agreement to direct a film for Hoffman at some time within the next 10 years following that film for a fee of $25,000 and 5 per cent of net profits.

When Hoffman tried to enforce that agreement, he was told that Speilberg was 20, and at the time 21 was the age of legal majority under Californian law, and so the legal opinion was that the contract was unenforceable. He's since been told that in fact Speilberg was 21 at the time. Hoffman is now suing Speilberg in deceit, breach of contract and fraud, seeking to have the contract enforced.

DAMIEN CARRICK: So it would appear that Hoffman and Speilberg didn't go to the California Arts Law Centre way back in 1967.

JULIE ROBB: Well, that's right, and there is in fact a body in California which could have helped either of them out.

DAMIEN CARRICK: Julie Robb, Director of the Arts Law Centre of Australia, thank you very much for speaking with the Law report.

JULIE ROBB: Thank you, Damien.

DAMIEN CARRICK: Well, what about performers? you may be asking. Anne Britton, the Federal Secretary of the Media, Entertainment and Arts Alliance, explains where they stand.

ANNE BRITTON: Performers have very few rights over their work and, basically, the only right we have is the right to prohibit a recording of a live performance without the artist's consent. There are also some very limited rights in relation to the use of a soundtrack in an audio-visual production, and that's that.

Once the recording has been made, providing that the performer has agreed to that in the first place. The performers are unprotected in two ways: One, there's no guarantee that if it, say, does very well at the box office - it does a Crocodile Dundee or it does a Strictly Ballroom - that the artist will share in that revenue; and secondly, once that recording is made, according to Australian Copyright Law, there is nothing to stop the program being re-edited and used in another program, being used in a 'making of', being used in a television advertisement to advertise Nike shoes or whatever. So it is very, very minimal.

Now in practice, of course, we have sought to remedy that by using collective agreements which are used throughout the industry. So, for example, we have agreements covering actors working in film and working in television and working in television advertising. And one of the arguments we've always had for performers' copyright is that performers shouldn't have to rely on their industrial might or otherwise in order to get a very basic level of protection that is afforded to other copyright holders to the people that they work with in any production.

DAMIEN CARRICK: I believe that the Media, Entertainment and Arts Alliance is trying to get up an industrial award to cover new forms of artistic expression, namely multimedia.

ANNE BRITTON: That's right. Well, multimedia is obviously a very big area for performers at the moment, or an expanding area for performers, and we're seeking a contract with the industry which gives performers rights in two major areas. One, is it ensures that we enjoy any revenue that's generated from the success of the program and, secondly, it protects the artists from having their image re-edited and used in a form that was not contemplated at the time.

Copyright protection is critical, particularly when the producer with whom you contract in 1996 might have gone bankrupt, or merged in some other form by the year 2000. Any program that has a reasonable life, it's absolutely critical if you're to protect your interests, not only to rely on contract but to have copyright protection.

DAMIEN CARRICK: Anne Britton there.

New technology and new mediums inevitably throw up a lot of new legal issues. That's certainly true of the Internet.

Pamela Morey-Nase heads the Intellectual Property law practice at the Melbourne office of Phillips Fox. She outlines just some of the issues which business people, Internet surfers, and artists, need to watch out for.

PAMELA MOREY-NASE: When you're beginning to do business on the Internet, you can really control the situation; you can determine what the terms of your contract are, and you really need to do that, otherwise you're liable to get yourselves into great difficulty.

DAMIEN CARRICK: Well, given the nature of the Internet, you actually control the entire interface, don't you?

PAMELA MOREY-NASE: That's right, and it's at the selling interface where you have the opportunity to determine the terms on which you're doing business, and even the countries in which you're doing business. So that if, for example, you know or would suspect that a particular advertisement for a product is going to contravene the laws in Saudi Arabia, for example, then you can make it quite clear at the point of sale that somebody in Saudi Arabia cannot accept your offer.

DAMIEN CARRICK: You're stipulating the legal jurisdiction as well as where your offer is being conveyed.

PAMELA MOREY-NASE: That's exactly right. And in fact you can, and you really need to stipulate the entire terms of the contract and make it quite clear that anyone who is accepting the offer is accepting the terms of the contract that you've stated.

DAMIEN CARRICK: Now, given there's been this Internet explosion, I understand that Phillips Fox now offers a checklist for risk management for people using the Internet. What does that do?

PAMELA MOREY-NASE: It's really designed to ensure that people who are thinking about doing business on the Internet just turn their mind to some of the practical issues that are going to avoid risk or reduce risk.

Some of the things that people can do and should do, are ensure that they have fire walls in place which protect their internal system from the Internet generally so that their system can't be corrupted by information coming in from outside. And just more basically, training programs for people within the organisation to ensure that they understand that any e-mail message that they send out onto the Internet, is really like - as somebody has described it -sending mail on a postcard. It's not secure. So if it contains anything defamatory or confidential, then it's likely that it's going to be accessed by others.

DAMIEN CARRICK: On that last point - defamation. There have, I believe, been recent cases involving defamation on the Internet.

PAMELA MOREY-NASE: There has. There's an interesting one, and this is a Western Australian case, which really probably just confirms that ordinary principles of defamation will apply on the Internet. But it was a case that involved an academic in Western Australia who published defamatory material on the Internet; it was put onto a bulletin board that was accessed by academics around the world who subscribed to that particular service. And the court found that, first, that the statements were clearly defamatory and, second, that by putting them onto a bulletin board they had been published, and they'd actually been published around the world.

DAMIEN CARRICK: And what about service providers, do they have any liability in the event of a defamatory publication on the Internet?

PAMELA MOREY-NASE: Well, service providers, because they are providing the .. all bulletin board operators, because they're providing the means of publication of statements that are potentially defamatory, they do have to exercise care. And the basic rule of defamation, which would relate to booksellers .. for example, if they're an innocent distributor of defamatory material then they're not liable for defamation, but if they know that they are distributing defamatory material then they may be. And the same principles will apply to Internet service providers, which means that it's really in their interests to ensure that they don't have any control over the content.

DAMIEN CARRICK: Now, in the area of copyright, have there been any cases involving the Internet?

PAMELA MOREY-NASE: Well, again, there have been, both here and in America. One of the early cases that everybody who is talking about the Internet refers to, is a case that involved Playboy. A Playboy centrefold was posted on to a bulletin board and the operator of the bulletin board was in fact found liable for the publication of that material in the same way that an owner of a photocopy machine would be found liable for authorising copies that are made using that machine.

DAMIEN CARRICK: And have there been any cases in Australia?

PAMELA MOREY-NASE: Well, there have, and in fact recently there's been a case relating to what is known as shareware, and this is the first case that there's been either here or in the States or anywhere else as far as I'm aware.

Shareware is really a method of marketing software which is a try-before-you-buy method of selling. Now, in the past, shareware really relied on the honesty of the users. At the end of 30 days they either paid the money if they were honest, or if they were dishonest, they didn't pay the money and they kept using the software. More recently, people have been putting timelocks onto shareware software, so that at the end of 30 days, if you don't pay the money, your access is denied.

Trumpet Software is an Australian company and a perfect example of one of the really innovative writers of software in this country, who are writing software that is becoming a world leader in its field, and there are a number of them. This was a man in Tasmania who was a psychology lecturer, I think, at the University of Tasmania for a number of years, and he then, in his spare time, wrote this software program which was called Trumpet Windsock and is a communication program that assists people connect to the Internet.

Now, the issue in this particular case involved Aus E-mail, which is an Internet service provider, who the Trumpet Windsock was offered as shareware. Aus E-mail made copies of the software and distributed it with a computer magazine, saying to people in effect, 'Here's the shareware software; use it for 30 days and then buy it if you like it' and not only that, they amended the software so that if you did buy it, you automatically connected to the Internet through Aus E-mail.

Now, the real issue in the case was whether Aus E-mail had the permission of Trumpet to do what it did and the court found that it didn't, because the owner of Trumpet was only prepared to permit Aus E-mail to distribute the software provided it had a timelock on it, and at that time it didn't because he hadn't perfected the timelock.

DAMIEN CARRICK: So this company was found to have breached the copyright owned by Trumpetware.

PAMELA MOREY-NASE: That's exactly right, because they had, without the licence of the copyright owner, they had made copies and distributed copies of the software. But although it's the first case relating to copyright and shareware, it's a case that's very much dependent on its facts, and it really turned on the fact that they did not have the authority of the copyright owner to do what they did.

DAMIEN CARRICK: And Pamela Morey-Nase, does that also apply in the artistic world as well as the business world? Are there issues concerning breach of copyright on the Internet for literary works and also for artistic works?

PAMELA MOREY-NASE: Absolutely. The principles are exactly the same, and in fact the potential for infringing copyright of literary works and artistic works, is greater than it's ever been. With digitisation you can make perfect copies instantaneously and transmit them all around the world. So the scope for infringement and the difficulty of detection is really on a scale it's never been before. So for creators of copyright material, it really is an enormous issue.

DAMIEN CARRICK: Pamela Morey-Nase there, on how intellectual property law is playing catch-up with new technology.