TUESDAY 18 MAY 1999

DR KIM HOWELLS, MP, MR JEFF WATSON, MR NEIL MARSHALL AND MS JUDITH SULLIVAN

  600. Just to come back on that, the only people who really benefit from first-to-invent are the lawyers. You have a whole industry out there which is dedicated to first-to-invent audit trails and trying to prove one thing over another, whereas although first-to-file has its disadvantages it does have much greater clarity to it.
  (Dr Howells) Indeed.

  601. It is much more difficult to have a dispute. I sometimes wonder whether the whole American set-up is not there to benefit the armies of lawyers who profit from it.
  (Dr Howells) You are quite right, Mr Butterfill. I was going to tell a horrible joke to the Committee about lawyers but I will not. This is a very fertile area for them. Indeed, as the whole question of intellectual property rights burgeons with the growth of E-commerce, for example, and the nature of the worldwide web, believe me, lawyers are not far behind in recognising niche markets for their partnerships.

  Chairman: There is a view in this Committee that jokes about lawyers are too serious to laugh at.

  602. You mentioned look-alikes earlier on and I think you said that consumers were bright enough to know the difference, but is there not an argument to say that supermarkets and others who make their own brands to look like other brands are fairly bright and they must be feeling there is good reason for doing this? Equally, the brands who complain must be complaining because they feel they have a legitimate concern. You say in your evidence that there is evidence that brand owners are not making full use of existing remedies, have you any evidence as to why brand owners are not using the remedies available to them?
  (Dr Howells) I think, Mr Morgan, it is for a very simple reason, and it is because they are a bit worried about their future relationship with the big sales outlets like supermarkets, which are very, very powerful entities now. I do not want to offer too many judgments on this because it is a subject which is under examination by the Competition Commission at the moment and we would be very interested to see the results of that. But I believe they do have the opportunity, if they so wish, to obtain some redress for look-alike exercises by various retail outlets and other companies if they wish to pursue them. I am often amazed that they do not pursue them and I suspect the main reason is because of their relationship with big retail outlets.

  603. But would you concede that there could be some genuine problem there?
  (Dr Howells) Yes, absolutely. When they came to see me, they put, amongst other objects, a woman's bathing costume on my desk in front of me and said, "Look at that". Then they put another one on which looked more or less identical to the other and they said, "That one cost £150 and that one cost £35. This is clearly a rip off."

  604. Which one!
  (Dr Howells) The £35 one! Quite! I blurted out suddenly that I had been an art student in the 1960s and I knew a lot of designers and I had seen a bathing costume which was almost identical to the one which was being sold in Harrods, as it happened, for the scandalously high price, and I said, "How can you tell me that the designer had not ripped that design off from somebody who had designed the one that I remembered as being almost identical or identical which was designed in 1966?" They sat there and said, "Well, we cannot really." You start to get into that stuff and have courts sitting to decide where the genesis of a particular design is, I think we will be creating a lot more business for lawyers and need a lot more judges.

  605. If I could move on to counterfeiting, the Anti-Counterfeiting Group were concerned about the priority given by various statutory bodies to try to counteract that and they mentioned Customs & Excise. I know that department is not one of your responsibilities but would you feel that you should be urging the Chancellor to get Customs & Excise to take that problem more seriously?
  (Dr Howells) Mr Morgan, I would not urge the Chancellor to do anything! He is a very bright and powerful man. We are trying to construct a consumer strategy at the moment which we hope to publish as a White Paper in the summer, and one of the things we recognise is that right at the sharp end of this whole business of ensuring that consumers are not being ripped off and that rogue traders are properly being policed and looked at is trading standards officers. These are marvellous people, very often under-resourced and very often unable to carry out statutory duties because there is a resourcing problem. We recognise that and I am admitting it to this Committee now, and I hope very much we will be able to make some progress in ensuring they have the resources to carry out those statutory duties and no doubt other duties which will fall upon them as the various European directives are implemented in the way they should be. I think they are a great bulwark for most consumers against the rip-off merchants who are out there.