Episode 29

This article explains cross-border infringement of industrial property rights. First, it is necessary to clearly distinguish between trademark infringement and patent infringement.

– Regarding trademark infringement:

① The Joint Recommendation states that the use of a mark on the Internet constitutes use in a member state only if it has a commercial effect in that member state (Article 2 of the Joint Recommendation) (Sushizanmai Case: Intellectual Property High Court Case No. 10031, October 30, 2014).

② While a trademark owner is not required to assert or prove the occurrence of damages, it is sufficient to assert and prove the fact of infringement and the amount of compensation that would normally be paid, it is reasonable to interpret this as meaning that an infringer can avoid liability for damages by asserting and proving the impossibility of damages as a defense. (Kozosushi Case: Supreme Court, 1994 (O) No. 1102, March 11, 1997, Third Petty Bench, Minshu Vol. 51, No. 3, p. 1055)

– Regarding patent infringement:

① The construction of the infringing system through the distribution service is considered to be a part of the information processing process for providing the infringing services in Japan. The system includes terminals located in Japan, and the effects of the infringing inventions are naturally realized on those terminals. Therefore, the location of the server outside of Japan is of no particular significance in relation to the realization of those effects. (Dwango vs. FC2 Case: Supreme Court, 2023 (Ju) No. 2028, March 3, 2025, Second Petty Bench)

② In the case of patents, utility models, etc., the infringing products themselves have creative value. Since the infringing products utilize the patents, etc. in their performance, utility, etc., a portion of the sales of the infringing products necessarily corresponds to the consideration for the patents, etc. Furthermore, the sale of infringing products means that there is a demand for products that implement the patent, etc., and the fact that infringing products are being sold in the first place can be said to mean that there is a demand for the establishment of a license to the patent, etc. (Supreme Court Commentary on the Kozosushi Case, Civil Case, 1997 (Vol. 1), p. 370).

Episode 28

In Episode 27, we explained the division of roles between Copyright Act and Design Act when it comes to protecting images in virtual space. This time, we will compare the protection of applied art under Copyright Act and Design Act.
The Copyright Act states, "The enjoyment of moral rights and copyright shall not require any formal performance" (Article 17, Paragraph 2). This means that the enjoyment of moral rights and copyright does not require administrative procedures such as registration.
Therefore, the enjoyment of moral rights and copyright is determined by the court, a judicial body. A person claiming copyright infringement must first file a lawsuit, asserting and proving the existence of the copyright and their identity as the author, in order to have their claim recognized.
Regarding the application of the Copyright Act to applied art, the Intellectual Property High Court ruled, "In light of the provisions of Article 2, Paragraph 1, Item 1 of the Copyright Act, even in the case of applied art for practical purposes, if a portion possessing aesthetic qualities that are subject to aesthetic appreciation can be identified separately from the components necessary for practical purposes, it can be deemed objectively identical to a '(pure) work of art that is a creative expression of ideas or emotions,' which is clearly included in Article 2, Paragraph 1, Item 1, and therefore that portion should be protected as a work of art under Article 2, Paragraph 1, Item 1.
On the other hand, even in the case of applied art for practical purposes, if a portion possessing aesthetic qualities that are subject to aesthetic appreciation cannot be identified separately from the components necessary for practical purposes, it cannot be deemed objectively identical to a '(pure) work of art that is a creative expression of ideas or emotions,' which is included in Article 2, Paragraph 1, Item 1, and therefore should not be protected as a work under that paragraph." (Intellectual Property High Court Case 2013 (Ne) No. 10068, Judgment of August 28, 2014)
Furthermore, in copyright infringement lawsuits, "the reproduction of a work means the reproduction of something that relies on an existing work and is sufficient to make its content and form known" (Supreme Court, First Petty Bench, Case No. 324 of 1975 (O), September 7, 1978, Minshu Vol. 32, No. 6, p. 1145), so reliance must also be asserted, proven, and accepted.
In contrast, under the Design Act, which is an industrial property law, the Japan Patent Office, an administrative organ, will prove the enjoyment of rights. Proof of reliance is also not required.
For these reasons, design registration is a reliable way to adequately protect applied art, and as a result, it allows for protection at low cost.

Episode 27

Currently, amendments to the Design Act to protect images in the virtual world (metaverse) are under consideration.
The issue at stake here is the division of roles between Copyright Act and Design Act.
Copyright Act protects the creative expression of ideas or emotions (Article 2, Paragraph 1, Item 1 of the Copyright Act). Currently, many countries, including Japan, are members of the Berne Convention. The Convention stipulates a principle of no formality (Article 5(2) of the Berne Convention).
Design Act is an industrial property law that requires registration with the Patent Office to establish rights.
In Europe, the European Union (EU) has a specialized agency for design registration, the European Union Intellectual Property Office (EUIPO), located in Alicante, Valencia, Spain.
The EUIPO's "Directive on the Protection of European Community Designs" stipulates that "'design' means the external appearance of all or part of a product resulting from the product itself and/or its ornamental features, in particular its lines, contour, colour, shape, texture and/or material" (Article 1(a)).
The term "'product'" also stipulates that "'product' means any industrial or handicraft product and includes, in particular, parts, packaging, exterior packaging, graphic symbols and typographical typefaces, etc., intended to be incorporated into a complex product, but excluding computer programs" (Article 1(b)).
In Japan, "handicraft products" are protected by Copyright Act (Article 2, Paragraph 2 of the Copyright Act), but not by Design Act (Article 3, Heading of the Design Act).
Furthermore, because typographical typefaces cannot be considered the shape of an article (Article 2, Paragraph 1 of the Design Act), it is considered difficult to protect them under Design Act in Japan.
The Berne Convention stipulates that "The scope of application of the laws relating to works of applied art and industrial designs, and the conditions for protection of such works and designs, shall be determined by the laws of the countries of the Union. Works protected in the country of origin exclusively as designs may claim in other countries of the Union only the special protection accorded to industrial designs in those countries. However, if no such special protection is granted in the other countries, such works shall be protected as artistic works" (Article 2(7)).
In other words, the conditions for protection of works of applied art and industrial designs are determined by the laws of the countries of the Union, but if protection is not granted as designs, they must be protected as artistic works. This means that applied art can be protected as either a work of art or an industrial design, and failing to be protected as either constitutes a violation of the Berne Convention.
Japan's Design Act stipulates, as a requirement for design registration, that "any person who creates a design capable of industrial application... may obtain a design registration for that design" (Article 3, Paragraph 1, head of the Act). In other words, applied art that cannot be used industrially must be protected under Copyright Act.
With regard to the copyrightability of typographical typefaces, the Supreme Court has ruled that "to qualify as a work under Article 2, Paragraph 1, Item 1 of the Copyright Act, a typeface must possess originality that distinguishes it from conventional typographical typefaces, and aesthetic qualities that make it an object of artistic appreciation in itself" (Supreme Court, First Petty Bench, Judgment of September 7, 2000, Case No. 332 of 1998, Minshu Vol. 54, No. 7, p. 2481).
For this reason, requiring copyright protection of typographical typefaces, which are not protected under the Design Act, to require "aesthetic quality that can be regarded as equivalent to pure art" could be a violation of the Berne Convention.
With regard to the protection of images in virtual space, it is appropriate to protect "designs that can be used industrially" under Design Act, and all other designs under Copyright Act.
For example, images used in computer simulation experiments, rather than evaluation experiments that previously required the creation of physical prototypes, would likely constitute an "industrially applicable design."
On the other hand, images in the metaverse space are likely to be protected by copyright law.