IP Review Winter 2018/19

11 10 This shows that although Toyota and Hyundai are both filing a large number of patent applications in the general field of electric vehicles, the focus areas for their research are somewhat different and thus hint at different features being developed for future models of electric car to try to distinguish them from their competitors’ models. Toyota and Hyundai have different IP strategies from other successful companies in the electric vehicle market, such as BYD and Tesla. BYD files fewer applications but these typically have a wide scope; whereas Tesla generally keep innovations as trade secrets, hence having a relatively small number of priority filings. The number of patent filings does not necessarily reflect sales; in the first months of 2018, Tesla and BYD topped the car sales charts on their domestic markets. However, patent numbers do show which companies are investing heavily in the electric vehicle market and could have a competitive advantage in the future due to the market exclusivity provided by a large patent portfolio. It will be interesting to see if Tesla and BYD can maintain their market share. UK patent landscape In the UK, Jaguar Land Rover is the most active domestic original equipment manufacturer (OEM) in the electric car market. The company has developed various solutions aiming at improving thermal management, packaging, and battery management systems of car batteries. Since 2000, the carmaker filed 26 priority applications; most of which have been in the last five years. McLaren Automotive also expressed interest in developing their own battery technology, which is supported by their application filed in 2013 relating to a multi-cell battery pack holder having a cooling jacket. Filing numbers of UK-based OEMs should significantly improve in the near future. Jaguar announced that from the year 2020 all their new vehicles ‘will be electrified with mild hybrid, plug-in hybrid and battery electric solutions’. McLaren pledged to dedicate £1.2bn to achieve 100% hybridisation and electrification by 2025. Aston Martin will be unveiling its first electric car - Rapide-E - in 2019, promising more electric models to come. Perhaps surprisingly, Dyson will also be working to produce three electric vehicle models utilising solid state battery technology. Government strategy to support innovation The UK Government, looking to the future, has committed £246m towards the Faraday Battery Challenge. The focus of the Faraday Challenge is ‘on the research, innovation and scaling up of battery technology [...] to make the UK a world leader in the design, development and manufacture of batteries for the electrification of vehicles’. £80 million from the Faraday Challenge fund is set to be invested in the construction of a new Battery Manufacturing Development facility in the West Midlands, the objective of which is to improve manufacturing processes and large-scale production of batteries. The Faraday Institution, costing £78m, will be responsible for accelerating fundamental research of novel battery technologies. The remaining £88mwill be awarded by way of Innovate UK Faraday Battery Challenges to the most promising industrial and scientific projects in the field of battery technology. In the long term, the Government also supports creating a UK giga-factory capable of meeting the future demand for cells from vehicle manufacturers, along with its requisite supply chain. Judging by the patent filing numbers, the UK automotive sector is off to a slow start in terms of investment into developing electric vehicles and the batteries to power them. Whilst looking at the number of patents filed is a fairly simplistic measure - it does not give an idea of the commercial impact or value of the patents - the fact that the top UK companies have filed tens of patents compared to the thousands of patents filed by the world leading companies does seem to suggest that the UK has quite a way to catch up. The Faraday Challenge fund set up by the UK Government to help companies in this area will certainly help to speed up the rate of innovation and development. However, to achieve the UK Government’s stated goal of making the UK a world leader in the design, development and manufacture of batteries for the electrification of vehicles, it will take a lot of hard work over a number of years to try to compete with the automotive industries in other countries. Designs Many people view the registration of designs to be the domain of companies in the high tech electronics and precision engineering industries. One only has to think of the latest smartphone release or the new offering in an upmarket car range and the lengths to which such companies go to protect their products’ unique looks. However, companies in all industries that produce distinctly designed products can take advantage of registering their designs to help protect and promote their company’s brand. This is no less true in the chocolate industry in which Waitrose has been on the receiving end of a ‘copycat’ claim fromHotel Chocolat after introducing a range of chocolate slabs having a similar appearance to those of the premium high street retailer. Hotel Chocolat opened its first store in 2003, and in 2006 launched a range of chocolate slabs - not with a straight edge and individual squares to be easily broken off, as had become the norm, but with a wavy edge and a single piece to be broken up in whatever size to suit the appetite of the chocoholic consumer. This fitted the brand identity of the emerging Hotel Chocolat as a purveyor of ‘crafted’ quality chocolate, with a nod to both traditional chocolate making and contemporary luxury. Aware of the importance of intellectual property rights, Hotel Chocolat applied for and secured registered design protection for their slabs. Registered designs can be used to protect the appearance of a product, whether that be the shape, configuration or surface features such as colour, or a combination of these. In Europe, there is huge flexibility in the registered design system for users to decide how to depict the appearance of the design. Line drawings can be used to focus on shape, whereas computer generated images and photographs can accentuate the importance of colour. Over the years, Hotel Chocolat introduced slabs with different flavours and toppings, such as ‘Eton Mess’ with white chocolate, strawberry mousse and meringue, and ‘Caramel & Co’ with milk chocolate, crunchy caramel squares and soft caramel buttons. Fast forward to 2018 and Waitrose started stocking their own range of chocolate slabs, with a wavy edge and including one also called ‘Eton Mess’ and another ‘Caramel Crunch’. It was not long before Hotel Chocolat’s co-founder Angus Thirlwell launched a scathing media attack against Waitrose’s “complete rip-off”. Copycat products are nothing new and discount retailers indulge in this sort of activity all the time, in most cases carefully just skirting around the edges of intellectual property laws. As well as design rights, trade marks (including 3D trade marks), copyright and the laws of passing off can come into play. There is plenty of debate about whether existing laws provide enough protection for brand owners, designers, inventors and other innovators, but it needs to be always borne in mind that these laws are intended to provide adequate protection for the creator without stifling healthy competition. What is interesting in ‘Slab-gate’ is that Hotel Chocolat sought to resolve the matter very publicly in the media and by asking Waitrose to simply “do the right thing”. Most retailers in Hotel Chocolat’s position would have shied away from the fickle unpredictability of the media and resorted to legal wranglings over the negotiating table. But the copycat products here were not from a discount retailer, they were from Waitrose, and that made a difference. Hotel Chocolat has a strong brand identity and loyal, well-heeled customer base but so does Waitrose and the idea that Waitrose could engage in ripping off would be quite damaging. Amongst the middle classes, Waitrose customers were likely to be Hotel Chocolat customers too. Having design right protection in place combined with the power of public perception of this particular demographic was instrumental in Hotel Chocolat’s success in ensuring Waitrose ‘did the right thing’ to withdraw the slabs from shelves. Indeed the confidence Hotel Chocolat had in its product and brand meant that it could go one further and offer an ‘amnesty’ swap for customers who had bought a Waitrose slab for a fraction of the price to return it in exchange for a Hotel Chocolat slab for no extra cost. Hotel Chocolat’s products are also sold in John Lewis stores and as Waitrose is part of the John Lewis Partnership this dispute had the potential for damage beyond the Waitrose brand. Although the approach taken by Hotel Chocolat to dispute resolution is not one that many businesses could have taken, it is without doubt that having an intellectual property position helped the success of Hotel Chocolat. By registering their designs not only did Hotel Chocolat have a legal basis for their assertions of copycatting but, perhaps more importantly, they used this as part of their brand identity as an innovator. Claiming the moral high ground using both the intellectual property rights and the brand identity gave Waitrose little option but to back down. To find out more contact Richard Worthington rworthington@withersrogers.com £78m, 32% Breakdown of fund allocation for the Faraday Battery Challenge Faraday Institution Innovate UK Programme Battery Manufacturing Development Facility £80m, 32% £88m, 36% To find out more contact Pawel Pietruszka ppietruszka@withersrogers.com Slab-gate IP review winter 2018/19