IP In The Digital Economy

Mr. Paul Bodenham

Studio Legale Alma
 Agenda

 Part A: IP & E-COMMERCE

 Part B: CREATING WEBSITE

 Part C: CHOOSING DOMAIN NAME

 Part D: PROTECTING YOUR WEBSITE

 PART A: IP & E-Commerce

Electronic commerce can be

defined as the exchange of
information, goods, services and
payments by electronic means
 PART A: IP & E-Commerce

 Impact of E-Commerce on IP

 Challenges Raised by the Impact

of E-Commerce
 Impact of E-Commerce On IP

 IP and Online Trade of Products and Services

 IP resides in the goods and services traded via e-
commerce;
 IP is the main component of value in the transaction

 IP and Digital Technologies

 The systems that allow the Internet to function -
software, networks, designs, chips, routers and
switches, the user interface, are all based on IP
 These are protected by IP rights
 Impact of E-Commerce On IP

 IP and Online Branding

 Relevance of trademarks and domain names;
 Business identifiers;
 Branding,
 Customer recognition;
 Goodwill

 IP and Business Value

 Related to IP
 Affected by the level of IP protection
 Impact of E-Commerce On IP

 Relevance of Patent Licensing

in E-Commerce
 Patents may be relevant to e-commerce as
well depending on what has been patented
 In the United States software and business
patents are patentable.
 Web-based businesses may be reliant on
patented technologies that they are
licensed to use.
 Challenges Raised By The Impact Of
E-Commerce

 IP Protection in Software

 Online Contents Distribution

 Domain Name Issues

 IP Protection in Software

 Various aspects of software are protected by

different heads / types of IP
 Copyright
 One of the most used forms of IP to protect the various
components of a computer program
 Patent
 Software in many countries inventions may be protected

 Industrial Designs
 Certain features created by computer software may be
protected in some countries as industrial designs, e.g.
icons on a computer software
 Online Content Distribution

 Illegal Downloads
 ease with which digital files can be downloaded affects unauthorized frequency of
copying of content
 Violate national laws of copyright

 As an e-commerce business, keep in mind:

 Importance of protecting IP rights on the internet
 The need to obtain permission before usage of ANY third party content
 Employees need to know company policies on IP
 Online Contents Distribution - Case Study

 RIAA v Napster
 The first case filed against a P2P system operator
 Put international spotlight on unauthorized downloading of music files
 The claim was that Napster facilitated illegal copying by users of the system, not that
Napster copied the files itself

 Lessons learnt:
 Make sure you have a clear policy against unauthorized copying of files, or any actions
that encourage or facilitate such copying;
 Make sure that your employees do not gain access to or keep in their possession or on
their systems any unauthorized copies of software or other content;
 Online Contents Distribution - Case Study

 Lessons learnt (continued):

 Make sure that all your employees know about the company’s policies against misuse of
IP
 Senior management should be responsible for reviewing company business practices on
a regular basis to make sure that the policy is being followed. It is wise to assess
situations in which a policy violation is found, to see if disciplinary action should be
taken.
 Domain Name Issues

 Failure to make an informed choice when selecting a domain

name
 Domain name may be available and registrable but may be in conflict with trademark
rights or personality rights of a third party

 To take note of:

 IP laws vary from country to country. Which law is applicable may be in question
especially when it involves parties from different countries.
 Enforcement of rights is tougher when IP rights are violated over the internet.
 PART B: CREATING WEBSITE

 Outsourcing Website Development

 Using Third Party Materials

 Outsourcing Website Development

 Developing a web presence would be critical in participating in

the digital economy
 If your website is developed by your employees, the copyright over the website will
usually belong to employer
 However, it is questionable as to who owns the rights when the website is developed by
an independent web developer or is otherwise outsourced
 The situation in most other jurisdictions v.
 The situation in Turkey
 Underlines the importance to have written Web Developer Agreement
 Identifying who owns each element of the website
 To note the issue of cost
 Web Developer Agreement - Salient Clauses

 Matters to consider prior to contracting

 Clear, long term vision of market for your product or service
 The agreement entered needs to reflect the needs of your vision

 Scope of work
 Specifications of what is to be developed
 Scope of Developer’s Responsibilities
 Writing Program Code, Design and Appearance
 Registration of domain name by whom
 Whether consulting services provided
 Whether services include maintenance and updating of site
 Web Developer Agreement - Salient Clauses

 Ownership of Material
 Who owns IP rights in components created by Developer?
 e.g. computer code, graphics, text, website design, digital files used for creating site
 Who owns IP rights in material provided by you to Developer for use in website?
 Where the Developer owns IP rights, whether you have the right to sublicense, edit,
etc.?
 Who’s responsibility to get permission from third parties for their IP?
 Who owns the IP rights in the software which displays your website and related
components?
 Can developer use the same designs as model and license the software (and related
components) for others?
 Web Developer Agreement - Salient Clauses

 Warranties
 Each party should warrant that it owns or has permission to use any material that it
provides for the website and that contents do not violate any law or regulation

 Maintenance and update

 Maintenance to include changes, updates, troubleshooting or repairs
 Level of maintenance and price terms
 Responsibilities of the Web Developer
 Actions upon service interruptions and break downs
 Web Developer Agreement - Salient Clauses

 Confidentiality
 Divulging confidential information about your business and giving access to your
facilities
 Non-disclosure clause to protect you against unauthorized disclosure of your trade
secrets

 Liability
 Who bears responsibility for links to other sites, designation of keywords and metatags?
 Whose liability in the event of any legal claims for infringement etc?
 Web Developer Agreement - Salient Clauses

 Other relevant clauses on :

 fees and payment
 timetable for delivery of website
 Indemnification
 disclaimers
 limitation of liability
 jurisdiction
 applicable law
 forum of dispute resolution
 Using Third Party Materials

 The internet makes it easy to reuse / copy the materials of others

 Films / television clips, music, graphics, photographs, software, text, etc
 The availability of these materials does not give you the legal right to do so
 Should not use these materials unless you have the necessary consent
 License or an assignment

 Technical Tools
 If you are using any search engine or internet tool for your website, ensure you have a
written license agreement before the installation of the site begins
 Using Third Party Materials

 Software
 Shrink-Wrap License:
 Packaged software is often licensed to you upon purchase. The terms and conditions of the
license are contained in the package, which is returnable if you do not agree. By opening the
package, you are deemed to have accepted the terms of the Agreement.
 Click-Wrap License:
 The licensing agreement is included inside the packaged software or on the webpage from
which you can install or download the software. Each time an end user install or download
the software, he/she may have an option to agree to the license terms.
 In all cases, check the licensing agreement to find out what you may and may not do
with the software you have bought
 Using Third Party Materials

 Copyrighted Works
 General
 Written permission is usually needed for the use of any written material, photos, videos,
music, logos, art work, cartoons, original databases, training manuals, drawings etc. in its
original form or found from the internet.
 Collective Management Organization
 Written permission is usually needed for the use of any written material, photos, videos,
music, logos, art work, cartoons, original databases, training manuals, drawings etc. in its
original form or found from the internet.
 Moral Rights
 Ensure the author’s name appears on the work and the work is not used or changed in a way
that would damage the author’s honour or reputation
 Using Third Party Materials

 Photographs
 Care should be taken when using photographs on your website. Authorization needs to
be obtained from the copyright owner of the photograph and the subject matter depicted
in the photograph, if necessary.

 Public Domain Material

 Instead of tracking down copyright holders, an alternative to consider would be using
materials that are in the public domain
 Sources range from libraries, collective management organisations to online portals that
offer licenses for different types of works
 e.g. photos, backgrounds, logos
 Also called clipart, freeware, shareware, royalty-free, copy free
 Using Third Party Materials

 Trademark
 When using others trademarks on the website, need to ensure usage does not create
confusion as to sponsorships, endorsements etc.
 Permission needs to be obtained from the copyright owner, if the law requires so.

 Other likeliness
 In some countries, publicity and privacy laws are in place.
 Before using any part of the copyright work, advisable to check the applicable laws and
to request permission.
 Using Third Party Materials

 Other Potential Issues - Linking

 General
 Links that lead web users to sites containing legal content (e.g. pirated songs, unlawful
software program etc.) may subject you to legal liability.
 Links that comprise of company logos may violate copyright, trademark or unfair
competition laws. Permission may need to be obtained
 Deep Link
 Deep links means links that go straight to a specific page other than a website’s home page.
Deep linking is generally not allowed if it is a way of bypassing a subscription or payment
mechanism, or if expressly forbidden by the site. Permission may need to be obtained .
 Framing
 Means displaying the contents of another person’s website within a frame on your site
leading to the impression that the information originates from your website.
 Using Third Party Materials

 Other Potential Issues - Metatagging

 Metatags are keywords or phrases embedded in a website’s HTML code, which are
invisible to the visitors of the website but are read by some search engines
 Instead of using terms that properly describe the site, some website developers place the
names of competing companies in their metatags in order to gain internet traffic
 Deceptive use of another company’s trademark in a metatag may constitute unfair
competition or trademark
 Using Third Party Materials

 Other Potential Issues - Personal Information Ptocessing

 Privacy laws may put limits and obligations on the collection, use and disclosure of
personal information
 If the website collects consumer information such as names, addresses, e-mail
addresses, gender and professions, be sure to protect the privacy of such information
 Also consider the need for training and supervision of all employees with access to such
information
 Using Third Party Materials

 Other Potential Issues - Terms and Conditions / Disclaimers

 Terms and Conditions
 If you sell products or services on your website, or allow users to download software, you
may have specific agreements posted on your site that contain warranty information or
disclaimers, limits on your liability etc
 Will the agreement be binding on users? How apparent are the terms and conditions? Is there
an opportunity to opt out? Has the user indicated his acceptance of the same?
 Notices and Disclaimers 
 Notices and disclaimers are rarely a cure-all for legal claims. However if your notice or
disclaimer is prominently displayed and clearly written, it may limit or even prevent liability
 The notices and disclaimers should be tailored to fit the specifics of the website
 Using Third Party Materials

 Other Potential Issues - Marketing and Removing Infringing

Material
 Marketing and Advertising Online 
 If you place advertising on your site, ensure that comply with specific laws and regulations on
advertising, content etc.

 Removing Infringing Material 

 If someone complains about an unauthorized use of copyright materials, you should remove that
material or disable the link pending resolution of dispute
 Continuing to utilise the disputed materials may aggravate the claims and increase the chances of
being found liable
 PART C: CHOOSING A DOMAIN NAME

 Basics of domain names

 How to choose a domain name

 Practical considerations

 UDRP: Resolution of cybersquatitng disputes

 Choosing A Domain Name

 Basics of Domain Names

 Introduction
 Every computer that is connected to the internet must have an IP (Internet Protocol) address
 The Domain Name System (DNS) has a database to link these numerical addresses on a one-
to-one basis with unique mnemonic alphanumeric equivalents called Internet Domain Names
 Two Parts in Domain Name
 Top-level domain (TLD) - TLDs can be divided into two categories: the generic top-level
domains (gTLDs) and the country code top-level domains (ccTLDs). Domain names may be
registered in either a gTLD or in a ccTLD
 Second-level domain (SLD) - The section with the business/company’s name
 Choosing A Domain Name

 How to Choose a Domain Name

 Choosing the Top-Level Domain
 Some gTLDs have no restrictions on who can register them e.g. .com, .info, .net and .org,
depending on the entity
 Other gTLDs are restricted i.e. only entities meeting certain criteria may be registered under
them, e.g. .int for international organizations
 You may register a domain name under a ccTLD, which corresponds to a country, territory,
or other geographic location and bears a two-letter country code e.g. .my
 The rules and policies for acquiring domain names in the ccTLDs vary significantly from
country to country
 You should take a careful look at the terms and conditions under which a registrar is offering
ccTLD registration services
 Choosing A Domain Name

 How to Choose a Domain Name

 Choosing a Good Second-Level Domain
 Select a domain name that is the same as or similar to your company’s business or product
name
 Choose a second-level domain that is distinctive of your business or products
 Never choose a domain that is the trademark of another company
 Avoid domain names that include controversial words
 Choose the most “commercial” suffix if you are selling your products or services
 Short domain names are generally the best as they are easier to pronounce, remember, spell
and type into a browser
 Choosing A Domain Name

 Case Study: Trademarks vs. Domain Names

 Trademarks and Domain Names systems are different, but in some situations may
overlap, e.g. when a trade name and trademark is used as part of a second-level domain
name
 Two identical trademarks may co-exist and be owned by different entities for identical
products in separate geographical areas under relevant trademark laws
 Two identical or similar trademarks in different classes of goods or services can also co-
exist in the same geographical area or country
 In contrast, the domain name system allows the use of one name by only one registrant
 Choosing A Domain Name

 Case Study: Trademarks vs. Domain Names (continued)

 Unlike trademarks, domain name create a monopoly right on a name or word,
independent of the goods or services offered on the website
 Two identical or similar trademarks in different classes of goods or services can also co-
exist in the same geographical area or country
 In contrast, the domain name system allows the use of one name by only one registrant.
 Unlike trademarks, domain name create a monopoly right on a name or word,
independent of the goods or services offered on the website.
 Choosing A Domain Name

 Practical Considerations
 Registration of Domain Name
 Anyone, whether an individual, organization, or company can register a domain name
 The duration of domain names are unlimited so long renewal or maintenance fees are paid,
similar to trademarks
 Exposure of the Domain Name
 It is important to make your business site’s ‘presence felt’ in order to attract visitors
 Register the domain name with popular search engines
 Before registering the domain name with the search engines, understand the ranking system
for different search engines
 Choosing A Domain Name

 UDRP
 To protect trademark owners and domain name registrants, the Internet Corporation for
Assigned Names and Numbers (ICANN), WIPO and national internet authorities have
put in place certain measures for the protection of the interests or trademark owners.

 Abusive Registration Criteria:

 The domain name is identical or confusingly similar to the trademark in question;
 The trademark owner has a right or a legitimate interest in the domain name, and the
domain registrant does not; and
 The registrant registered or is using the domain in bad faith
 Choosing A Domain Name

 Case Study: UDRP Procedure

 The filing of a Complaint with an ICANN-accredited dispute resolution service provider
chosen by the Complaint, such as the WIPO Center;
 The filing of a Response by the person or entity against whom the Complaint was made;
 The appointment by the chosen dispute resolution service provider of an Administrative
Panel of one or three persons who will decide the dispute;
 The issuance of the Administrative Panel’s decision and the notification to all relevant
parties; and
 The implementation of the Administrative Panel’s decision by the registrars concerned
should there be a decision that the domain names in question be cancelled or
transferred.
 PART D: HOW TO PROTECT YOUR WEBSITE

 What elements of your website can be protected

 How to protect your website

 Take action against violations

 How To Protect Your
Website

Elements Of Websites That Can Be Protected How Protected

New Technologies Systems, Search Engines, Technical Internet Tools Patent / Utility Models
Software Copyright
Website Design Copyright
Creative Website Design – Written Material, Photographs, Graphics,
Copyright
Music and Videos
Databases Copyright
Business names, logos, product names, domain names and other signs
Trademarks
posted on websites
Computer-generated graphic symbols, screen displays, graphic user
Industrial Design Law
interfaces (GUIs) and webpages
Graphic Symbols – Confidential Graphics, Source Code, Object Code,
Algorithms, Programs or other Technical Descriptions, Data Flow Charts,
Trade Secret Law
Logic Flow Charts, User Manuals, Data Structures and Database
Contents
 How To Protect Your
Website

 Protecting your IP Rights

 Register your Trademarks
 Register a domain name that is user-friendly and reflects the trademark, business name
or character of your business
 Register your website and copyright material with the national copyright office (in
countries which provide this option);
 To think about patenting online business methods, in countries where such protection is
available
 How To Protect Your
Website

 Letting People Know Content is Protected

 Mark your trademarks with trademark symbols
 Use the copyright notice
 Use watermarks with embed copyright information into digital content itself.
 Give notice to the public that your website or business method is patented.

 Letting people know what use they can make of the content
 what can they do with the page
 who to contact to get a copyright clearance in relation to any material on your site.
 How To Protect Your
Website

 Detecting Infringements of your Website

 To detect infringements, you may take random snippets of text or images from your site
and search for the snippets or images using search engines like Google and for images
http://images.google.com by entering the graphic’s file name.
 ‘Spider programs’ can also search the internet for copies of your pages or
graphics and illegal use of your trademarks.
 How To Protect Your Website

 Taking Actions Against Violations

 Make screen shots or prints of all relevant pages, and print source code from the
infringing website
 Be sure you can prove that your website content is original and that you have owned it
for a longer period of time than the infringing website
 Send a cease and desist letter to the owner of the infringing website asking to take your
material off their website
 If the owner does not respond, you may:
 send a notice of infringement to any search engine where the infringing site is listed
and demand that they remove any links to the infringing site; and
 send a notice of infringement to the website hosting company or internet service
provider (ISP) and demand that the infringing site be removed from the server where
it is hosted.
 Recent Developments in
Turkish E-Commerce
Legislation

• The past few years have seen a great increase in the number of sales made over the
internet in Turkey. Today, Turkey has approximately 35 million internet users. In 2010,
Turkey had a total e-commerce volume of 15.2 million TL and it is expected that this
will expand by 50% in 2011.

• According to the data provided in Interbank Card Center’s (“IBCC”) website, the total
number of transactions made over e-commerce websites (between 1 January 2011 and
31 March 2011) have increased by 40%, reaching 28,096,690
 Recent Developments in
Turkish E-Commerce
Legislation

• A Draft E-Commerce Law is currently pending before the Grand National Assembly of
the Republic of Turkey (the “National Assembly”) and is expected to be passed before
the end of 2011. The Draft E-Commerce Law governs the general principles that are
applicable to e-commerce transactions.

• The Draft E-Commerce Law aims to enhance trade communications and render e-
commerce transactions to become more widespread in Turkey. It governs electronic
agreements and includes protective provisions for internet sales to consumers.

• It also ensures a more secure and transparent environment for e-commerce transactions
for the purposes of accelerating e-commerce transactions in Turkey.
 Recent Developments in
Turkish E-Commerce
Legislation

• The two substantial topics covered in the Draft E-Commerce Law are (i) service
providers’ obligation to give information in connection with electronic agreements and
(ii) the provisions in relation to unwanted e-mails.
 Recent Developments in
Turkish E-Commerce
Legislation

• According to the Draft E-Commerce Law:

• Service providers and the persons who sell goods online must enable the buyer to see all
terms (including but not limited to the total purchase price) of the electronic agreement
clearly, before the buyer submits his/her payment details.

• Where the trade communication is made on behalf of a real person or legal entity, it will
be mandatory for such real person or legal entity to provide the necessary information
for him/her/it to be identifiable to others.
 Recent Developments in
Turkish E-Commerce
Legislation

• Giving gifts, discounts and promotions and organizing events or games for the purposes of
promotion must expressly indicate the promotion purpose. The information in relation to
attendance to these events and organizations must be easy to access and clearly comprehensible;

• Commercial text messages and e-mails will not be possible to send before obtaining the relevant
persons’ approval and the receivers of these commercial texts and e-mails will be able to reject
receiving those messages at any time.

• Service providers will be responsible for the security, protection and maintenance of personal
data, which they have acquired during the e-commerce transactions and they will not be able to
distribute those personal data to other third parties or use them for any other purposes.
 Recent Developments in
Turkish E-Commerce
Legislation

• Under Article 9/A of the Consumer Protection Law, distance sale agreements are
agreements agreed via written, visual, telephone and electronic media or other
communication tools and without coming face-to-face with the consumers. Before the
execution of a distance sale agreement, a notification which would involve the
necessary information set forth in the Regulation must be provided to the consumer.
Unless the consumer confirms in writing that he/she has received such information, the
distance sale agreement cannot be concluded. In electronic agreements, the
confirmation of the consumer must be given through electronic media as well.
 Recent Developments in
Turkish E-Commerce
Legislation

• Consumers have the right to withdraw from the contract within seven days without showing
any reason and/or paying any penalty.

• In order for the withdrawal to be effective, it is sufficient that the relevant consumer notifies the
seller and/or provider in writing or via data transmitter.
Thanks for attention!

Mr. Paul Bodenham

pb@avvbodenham.it