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In house lawyers forumSeptember 2016, London
Employment Law Update
Elish Kennedy
Sham job applicants not covered by discrimination lawQuotes from a recent application to one of our clients:
“The reasonable adjustments include the arrangement of safe travel provision as well as overnight hotel rest before interview. And paid carer provision, taxis and meals. This is to allow me the same opportunity to attend interview as all other able bodied candidates. If I am invited to interview and you make it impossible for me to attend that interview as all other candidates will have the opportinuty to do, then I will seek to sue for discrimination through Employment Tribrunral as is my legal right (sic). ”
Sham job applicants not covered by discrimination lawKratzer v R + V Allgemeine Versicherung AG C-423/15• If an individual applies for a job only in order
to seek compensation for discrimination and not to obtain employment, they will not be covered by the protection of discrimination law.
Modern Slavery StatementReminder s54 of the Modern Slavery Act applies to a commercial organisation which:• Supplies goods or services• Has a total turnover of £36m a year or more
(globally)Statements are due at the end of September for organisations whose financial year end was 31 March 2016.
Modern Slavery Statement• The organisation will have to make a ‘slavery
and human trafficking statement’ stating the steps it has taken during that financial year to ensure that slavery and human trafficking is not taking place in:– Any part of its own business– Any of its supply chains.(Or issue a statement that it has taken no such steps)
Modern Slavery Statement• The statement must be published on the
organisation’s website with a prominent link to the statement on its homepage
• In the case of a company, the statement must be approved by the board of directors and signed by a director.
Gender Pay Gap Reporting• The Regulations have been delayed – now
expected in April 2017• In that case, the first “relevant date” under
the Regulations will remain at 30 April 2017, meaning first gender pay gap reports due by the end of April 2018
Gender Pay Gap ReportingWhy do you need to think about it now?• Although you don’t need to report until April
2018, that is for data from April 2017.• If the data reveals an issue, you will need to
time to address that before it is included in the data that will need to be published
Gender Pay Gap Reporting“UK women still far adrift on salary and promotion as gender pay gap remains a gulf” The Guardian, 23 August 2016
“Gender Pay Gap Hits Women With Children Hardest” Sky News, 22 August 2016
“Mothers’ pay lags far behind men”BBC News, 22 August 2016
“The Gender Pay Gap means that more women will be in poverty later in life”The Independent, 26 August 2016
Brexit and Employment Law• In reality – little change in the short term
• Possibly changes to working time regulations, collective consultation, agency worker regulations, TUPE
Brexit and Employment LawBut what about now?• Consider make-up of workforce• Permanent Residence/Citizenship• Apply for sponsor licence?• No discrimination against EEA nationals in
recruitment
Offers of Settlement in the Litigation Process Katie Scott - CDR
Hot Topic Offers of settlement have been a “hot topic” in the Courts over the last 12 months. Following the April 2015 changes to both the Pre-Action Protocols and the provisions of CPR Part 36 we have seen a number of the Court’s decisions focusing on this aspect of the litigation process.
In this session I intend to:
• review the changes to the Pre-Action Protocol;• review the changes to Part 36; and • look at the recent case law and practical implications of the Court’s
decisions.
Pre-Action Protocols “If proceedings are issued, the parties may be required by the Court to provide evidence that ADR has been considered. A party’s silence in response to an invitation to participate or a refusal to participate in ADR might be considered unreasonable by the Court and could lead to the Court ordering a party to pay additional Court costs.”
“The Court may decide that there has been a failure of compliance when a party has unreasonably refused to use a form of ADR, or failed to respond at all to an invitation to do so.”
Pre-Action Protocol Practice Direction, April 2015
Pre-Action Protocols Consequences of non-compliance These include:-
• an order that the party at fault pays the costs of the proceedings, or part of the costs of the other party or parties
• an order that the party at fault pay those costs on an indemnity basis
• if the party at fault is a claimant who has been awarded a sum of money, an order depriving that party of interest on that sum for a specified period, and/or awarding interest at a lower rate than would otherwise have been awarded
• if the party at fault is a defendant, and the claimant has been awarded a sum of money, an order awarding interest on that sum for a specified period at a higher rate, (not exceeding 10% above base rate), than the rate which would otherwise have been awarded
Form of Settlement OffersOffers of settlement can take various forms
Open offer – an offer which is not subject of the privilege of the without prejudice rule
Calderbank offers - an offer which can not be referred to the Court during the course of litigation but can be in respect of costs
Without Prejudice offer – an offer which can not be referred to the Court during the course of litigation or on the question of costs
Part 36 Offers - will be treated as an offer made without prejudice save as to costs but will have the consequences specified in CPR 36.13, CPR 36.14, and CPR 36.17
Use of Part 36 Offers An important tactical step in the course of litigation
Provides a means of putting pressure on the other side
Protects, to some extent, a party’s position on costs
For claimants, can lead to enhanced recovery on interest and costs
Requirements for a Part36 OfferCPR 36.5 - every offer made after 1 April 2015 must:
Be made in writing
Make it clear that it is made pursuant to CPR Part 36
Specify the relevant period
State the scope and/or extent of the offer
State whether it takes into consideration the settlement of any counterclaim
The Relevant Period The “relevant period” means:
Where an offer is made not less than 21 days before trial, either:
the period specified in the Part 36 offer of not less than 21 days, within which the defendant will be liable for the claimant’s costs in accordance with CPR 36.13 or CPR 36.20 if the offer is accepted; or
any longer period as the parties agree
Otherwise, the period until the end of such trial.
Changes to CPR Part 36Time limited offers
CPR Part 36.9(4)(b) now provides that the offeror can serve advance notice to withdraw its offer (or amend it on less favourable terms).
This introduces the possibility of more strategic offers to exert pressure on the offeree.
Changes to CPR Part 36Formalities
CPR Part 36.5(1) now states that a party only has to make it clear that its offer is “made pursuant to Part 36”.
This is as opposed to the previous regime which required an offer to state on its face that it was intended to have the consequences of Section 1 of Part 36.
Changes to CPR Part 36 Improving offers
CPR Part 36.9(5)(a) confirms that an improved offer shall be treated not as the withdrawal of the original offer but as making of a new Part 36 offer on improved terms.
This removes any previous confusion as to whether there can be multiple offers on the table at the same time.
Changes to Part 36Split trials
CPR Part 36.16 now states that after the hearing of preliminary issue, the terms of any Part 36 offer (relating only to the concluded issues) may be revealed to the Court.
Accordingly, parties may wish to consider sub-diving their settlement offers so that certain terms can be disclosed at an earlier stage if appropriate.
Changes to CPR Part 36Cynical offers
Historically the Courts have experienced some difficulty dealing with ‘cynical’ offers.
CPR Part 36.17(4)(b) now addresses such offers as it allows the Court to take into account whether an offer was a genuine attempt to settle the proceedings, when considering whether the automatic consequences of Part 36 should apply.
Changes to CPR Part 36Costs budgets
The general rule is that where a party has failed to file a costs budget in time, it is treated as having filed a budget limited to Court fees.
CPR Part 36.23 now provides that in these circumstances, a party’s recoverable costs shall be limited 50% of the costs otherwise recoverable (not limited to Court fees).
Changes to CPR Part 36 Pre-issue offers
CPR Part 36.7 provides that an offer can be made at any time, including before the commencement of proceedings
CPR Part 36.13 confirms that the claimant’s automatic entitlement to reasonably incurred costs includes their recoverable pre-action costs
This amendment will hopefully encourage more early offers being made, particularly given the recent substantial increase in issue fees for money claims
Recent Case LawJockey Club Racecourse Ltd v Willmott Dixon Construction Ltd [2016] EWHC 167 (TCC)
Offers as high as 95% of the claim value can still be viewed as a “genuine attempt at settlement”
Each case will turn on its own facts
Recent Case LawSugar Hut Group Ltd & Oths v A J Insurance [2016] EWCA Civ 46
There is no “near miss” rule
It does not matter by how much a claimant beats a Part 36 offer
The rules now expressly provides that an offer will be beaten if the Court’s award is better in money terms by any amount, no matter how small
Recent Case Law Hertel v Saunders [2015] EWHC 2848 (Ch)
Offer to settle was not a valid Part 36 offer as it only related to a claim put forward in daft amended particulars of claim
Failed to comply with mandatory requirement under Part 36 to “state whether it relates to the whole if the claim or to part of it or to an
issue that arises in it and if so which part or issue” CPR 36.5(1)(d)
Recent Case Law Patience v Tanner [2016] EWCA Civ 158 and Burrell v Clifford [2016] EWHC 578 (Ch)
Two cases where the Court refused to treat offers which fell outside the Part 36 regime as favourable as a Part 36 offer
Patience v Tanner – the defendant’s offer was not a Part 36 offer as it did not offer to pay the claimant’s costs if accepted with the relevant period
Burrell v Clifford – offer fell outside the Part 36 regime because the amount offered in respect of costs was fixed at a specified sum
Practical Implications The key points to take from this
Courts will expect parties to have engaged in ADR and/or settlement discussions pre-issue and there will be consequences for failing to do
so
Settlement offers can take various forms but the form of the offer made impacts on the manner in which the offer is treated and the level of
“protection” it provides the offeree
Changes to the provisions of Part 36 means that an early Part 36 offer is a very useful pre-action settlement tool
Practical Implications If you are making a Part 36 offer you must ensure that it is in the
correct form and meets all of the requirements of Part 36.5
Offer which do not meet all aspects of the strict requirements of Part 36.5 will fall outside of the Part 36 regime
Any offer made must be a genuine attempt to settle the dispute and this will turn on the facts of each specific case
There is no “near miss” rule. The amount by which an offer is beaten is not relevant
Commercial update
Richard Nicholas
Areas to look at• Brexit + contracts
• Digital Single Market Initiative/ Digital Signatures
• Case Law
Quick advert…In house lawyer “checker” Product
- Free second opinion/expert view/check a point– Approx 20 minutes on the telephone- Equivalent to seeing a specialist at their desk- Exclusively for in-house lawyers
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Brexit – effect on contracts?Questions:
• Is it affected at all? (Term)• European* Territory? • Law/ Jurisdiction/ Enforceability?
– Rome (Law) – Brussels (Jurisdiction/ Enforceability)
Brexit – effect on contracts?
Law: Conflict of law rules pre-Rome (& UK common law)
Jurisdiction and enforceability:
– Lugano convention/ Hague convention on Choice of Court Agreements
- New York Convention on Arbitral Awards
Brexit – effect on contracts?• Unlikely FM or Frustration
• “Change of law” / “Material adverse change” provisions
• Consider changes relating to specific areas of law
(e.g. data protection – hosting arrangements)
Brexit – effect?Speculation:
- Tariffs/ restrictions/ licensing?- Financial Services passporting?- Exchange rate volatility - further drop in
sterling?- EU based law – insolvency, data protection,
House of Commons Briefing Paper 26 August 2016
So What?For Long term contracts- Stated law and jurisdiction?- Reference to EU/Europe?- Change likely given the subject
matter/sector?(See the HC report)
- Include mechanism for unforeseen consequences
- Use the time to prepare
Digital signatures Regulation• New EU regulation effective from 1 July 2016(eIDAS Regulation)
Digital Single Market“One Territory – One Market” online
Multiple regulations and initiatives including:
- Cybersecurity Directive (2016)- GDPR (2016)- Geo-blocking: Regulation 2017- Cross border parcel delivery regulation- Consumer Protection Co-operation protection
So what?- Over next couple of years – EU regulation to
standardise digital economy- Will affect businesses selling into EU- Unclear what measures UK will adopt
Case lawTwo cases on “no variations”:
Globe Motors v RW Lucas CA 2016MWB v Rock Advertising CA 2016
So what?Bluff factor – Know when you’re bluffing!
Similarly: - Binding “only when signed” (Revielle v Anotech 2016)
- “No Waiver” - (if affirmed) Tele2 International Card Co SA & others v Post Office Ltd - 2009
So what?Future is uncertain
Some things predictable- Changes in long term contracts- EU regulation – towards single market- Contracts will be varied - Some clauses have “bluff” value only - Lawyers relentlessly market their
products
Comfort break
Data protection update
Mark Gleeson
Brexit and Data Protection• General Data Protection Regulation (GDPR)• Network Information Security (NIS)• ePrivacy Directive update• Cybersecurity and Brexit• Are we adequate?
EU-US Privacy Shield• Background• Principles• Structure of Privacy Shield• What to ask your provider• Practical steps for Providers• Enforcement
Cyber Security• ICO Report 2015• Ashley Madison Report• Insurance and insurers• Recent hacking
Recent Cases
• Bangura v Loughborough University• Camera di Commercio, Industria, Artigianato
e Agricoltura di Lecce v Mnni • Weltimmo• Verein für Konsumenteninformation v Amazon
EU Sàrl • Vidal-Hall update
IT & Technology
Paula Dumbill
The agenda
• Software and the Commercial Agency Regulations
• Website blocking orders• Cloud computing• Regulation of drones• Cyber Security Directive
Software and the Commercial Agency Regs
The Software Incubator Ltd v Computer Associates Limited [2016]
Held: Software falls within the definition of “goods”
• Dispensed with distinction tangible / intangible• Commission based arrangements require review• But what about subscription fee basis or cloud
hosted – more a service?
Website blocking orders• 6 July 2016 Cartier International AG v British
Sky Broadcasting – follows Cartier I
• CoA dismissed appeals against orders requiring ISPs to block access to sites that infringe TMs
• Extension from copyright to trade marks - Article 11 – IP Enforcement Directive
Alternative measures?
• Proceedings against operator of target websites
• Notice and takedown against website host• Payment processors suspend merchant
accounts• Search engines to de-index• Domain name seizures• Customs seizures
Cloud computingFCA Guidance – what does it say?
• What is it?• What are its characteristics?• What types of services are there? SaaS, IaaS,
PaaS• Who provides it and how?
Key issues• Control over service and data security
• Data residency - processing in multiple locations
• Data integrity and recoverability
• Regulatory compliance and auditing
Mitigation strategies• Due diligence – entire supply chain, services
in different jurisdictions• Review proposed terms of use, privacy policy,
acceptable usage policy, SLA• Getting the contract right – controls on data
processing, audit rights, information sharing, change management, access to premises, remedies for breaches
• Update policies and documentation
Contract issues to look out for• Liability – loss of data/ service outage, DP, privacy
and confidentiality• IPR – ownership of developed / adapted materials• Hidden charges – user thresholds, storage limits,
set-up fees, security/back-up, upgrades / premium fees
• Termination – minimum periods, short notice periods
• Governing law and jurisdiction -arbitration• Lock-in/exit – grace period for data recovery• Slalom paper
Drones • Facebook’s Aquila drone• Amazon testing for drone delivery service• HMP Pentonville drugs and mobile phones• Civil Aviation Authority regulation• Geofencing• Breach of privacy, trespass, nuisance,
harassment• Registration?
Some good advice• consent by notices, signs, media, publicity• operate only with sensor equipment
necessary for purposes intended and only record data to achieve purposes intended
• robust security and access controls• mechanism to auto blur unintended face
capture• software to delete personal data once task
completed
Cybersecurity DirectiveCybersecurity Directive – published 19 July 2016• To be implemented 10 May 2018 • Transitional measures from 9 February 2017“An Open, Safe and Secure Cyberspace”Priorities:cyber resilience reducing cyber crimecyber defence policy development of resources coherent international policy
Cybersecurity DirectiveObligations to regulate:• operators of “essential services”• digital service providers - online
marketplaces, cloud computing services, search engines
Essential – energy, transport, banking, financial market infrastructure, health, water, digital infrastructure
Questions?
Intellectual Property UpdateBonita Trimmer
What’s new• Brexit + Patents/Trade
Marks/Designs/Copyright
• The new Trade Mark regime
• Case law - your trade mark - use it or lose it: but how much and where?
Our Brexit resources hub…
• Take a look - “what you need to know” about Brexit www.brownejacobson.com/trainingandresources/resources/brexit
• Search for “Brexit resources”
• Much of UK IPR legislation derives from the EU – without the CJEU, increasing divergence is likely
Brexit – Patents• The change is: “nothing is going to change” • The UPC will probably still happen (although
delayed beyond 2017) but the EU Unitary Patent will not cover the UK (at least post Brexit)
• The EU Unitary Patent will cover the participating EU Member States (all except Croatia & Spain)
• So for protection in the UK – no change - the UK national patent and EP (UK) patent regime (not an EU creature) will continue “as is”
Brexit – EU Unitary IPRThere will be significant changes/but what?• EU Trade Marks (formerly Community Trade
Marks) – New Treaty (EU+) - nothing changes (wishful)– Automatic free UK TM - all or pre-existing - (BO
EU TM GOF UK TM) (possible)– Elected UK TM add on - free or fee/with or
without examination (likely)• Community Registered Designs
– As for first 2 above
Brexit – other EU IPR• Community Unregistered Designs (CUD)(3
years)
– Different creature to UK Unregistered Designs – An IPR loss for those entitled prior to Brexit? – No CUD unless & until “disclosed” in the EU – But prior designs disclosed world-wide (e.g. post
Brexit UK) can impact novelty/individual character
Brexit – other EU IPR initiatives• Trade Secrets Directive – came into force on 5
July 2016 – EU Member States must implement the
Directive by mid 2018– Will we bother?
• Copyright reforms (new leaked draft Directive)– New compulsory exceptions & rights – Impact unlikely
So What?• Key brands - where you only have an EU TM
and you want to avoid any uncertainty, apply for a UK TM now (dual filing has always had benefits)
• Consider filing a UK RD design as well as/instead of a CRD, particularly approaching Brexit (12-month grace period)
• Use the time to audit your IPR - what IPR is really core to your business?– so as to act fast and cost effectively when
needed
New Trade Mark Regime• EU member states have until 14 January 2019
to implement the changes made by the EU Trade Marks Directive (harmonises national trade mark law)– Will we bother?
• However most of the amendments to the EU Trade Marks Regulation (governs EU TMs) came into force in March 2016
New EU Trade Marks Rules• Whether or not EU TMs cover post Brexit UK,
still good value for many businesses (covers all the 27 remaining EU Member States)
• Changes implemented this year are– new fee structure (1-2 classes cheaper/multi-
class - more expensive)– no need now to represent EU TMs “graphically” – grounds of refusal/invalidity which related only
to “the shape of goods” now extend to other “characteristics” of goods
New EU Trade Marks Rules• Changes re enforcement
– Use of a trade mark as a company name may now infringe and the “own name” defence is now limited to individuals
– Non-use now a defence as well as a grounds for revocation (burden on claimant to prove use in relevant 5 year period)
So what?• Review your portfolio – there are now
additional challenges for non-standard marks• Enforcement or defence strategies need to
take into account the changes re company and business names
EU Trade marks & 5 years non-use Use it or lose it, but how much and where?Recent cases:• Just UK (or France or Germany etc.) unlikely to
be enough anymore • Need an adequate scale/volume of use too• Does your evidence of use paint a convincing
picture that you have a market or are creating a market “in the EU”?
• UK national marks – scale of use now matters too
EU Trade marks & 5 years non-use Sofaworkshop Limited v Sofaworks Limited (IPEC) • “implied default requirement that use beyond
one Member State is a necessary ingredient of genuine use in the Community as a whole”
• Owner of EU TM for “Sofaworkshop” made “extensive” use of it in the UK but 1 sale only elsewhere in the EU (in Denmark)
• Not “genuine use” in the EU = EU TM revoked
JumpmanOwner of Jump
EU Trade marks & 5 years non-use Jumpman (Appointed Person – UK IPO)• Turkish company (with EU TM for JUMP)
opposed Nike’s attempt to convert its application for a EU TM for JUMPMAN to a UK TM
• In relevant period 55,000 pairs of JUMP branded footwear sold (value $476,000 approx.) to a single Bulgarian company
• Sold on to end users/170 sold on a Romanian Co.
• “Real commercial” use (not sham or token)• Not genuine use in the EU – opposition failed
So what?• You should review your trade mark portfolio to
identify your mature marks (5 years +) • Consider whether they are still being used at
all – don’t pay “money for nothing”– but consider whether you would object to
others using them (nostalgia brands) & deterrent effect
• Consider how those you want to keep renewing would withstand a non-use challenge
• Consider new (layered) filings – worth the cost?
