This Week’s Techlaw News Round-Up

July 7, 2023

UK law

CMA says that design software deal could harm UK digital economy

Adobe supplies the Photoshop and Illustrator applications, as well as video, motion design, and interactive content Figma provides screen design and whiteboarding tools. Adobe announced it would acquire Figma for $20 billion in September 2022. The CMA has identified concerns in the supply of screen design software, where Adobe’s and Figma’s products compete. It found that Figma has established a substantial share of the market for screen design software and that Adobe has been continuously investing in and competing in this segment. Competition between Figma and Adobe has driven investment in updating and developing screen design software, and this important rivalry could be lost if the deal goes ahead. The CMA also identified concerns in the provision of creative design software, where Adobe offers some of the leading tools for image, video and animation content. The CMA’s investigation found that Figma is an emerging competitive threat to Adobe across these tools, and that Figma is well-placed to expand its offering and provide an increased constraint to Adobe. The CMA says that this rivalry and innovation is important to the sector and could be threatened by this deal. Many start-ups and other businesses rely on the software products provided by Adobe and Figma to produce apps and websites, as well as engaging content. The UK app economy alone was worth £19.4 billion in 2022. The CMA is concerned that Adobe’s plan to acquire Figma removes a leading player from the market and reduces both firms; incentives to invest in software development and compete against one another, which could result in higher costs as well as fewer and less innovative products.

Review of regulation of pornography launched

The government has announced that regulation of online pornography in the UK will undergo a thorough review to make sure it is fit for purpose in tackling exploitation and abuse. The criminal law has been updated in recent years to tackle the presence of extreme and revenge pornography, but there are currently different regimes that address the publication and distribution of commercial pornographic material offline, such as videos, and online. The government wants to ensure any pornography legislation and regulation operates consistently for all pornographic content. The review will also look at how effective the criminal justice system and law enforcement agencies are in responding to illegal pornographic content, including considering if any changes need to be made to criminal law to address challenges law enforcement might have. It will also consider what more can be done to provide children with information and resources about the harm caused by pornography. This will make sure that illegal and harmful content, such as that which features child sexual abuse and exploitation, or where adults are being exploited, is robustly dealt with. The review is separate to, but builds on, the Online Safety Bill. The review will also look at the role of the pornography industry in trafficking and exploiting adult performers, child sexual exploitation and abuse, and how extreme and non-consensual pornographic content online is dealt with.

Home Office publishes report on independent review of IPA 2016

The Home Office has published a report by Lord David Anderson KC on his independent review into the investigatory Powers Act 2016. The review focussed on the effectiveness of the bulk personal dataset regime, criteria for obtaining internet connection records, the suitability of certain definitions within the Act, and the resilience and agility of warranty processes and the oversight regime. The report outlines his findings and recommendations. The Home Office will now consider those recommendations to inform proposals for future legislation.

ICO submits data protection and journalism code of practice to the Secretary of State

The ICO has published a code of practice about using personal information for journalism, when it has now formally submitted to the Secretary of State at the Department for Science, Innovation and Technology. The Code provides practical guidance on how to comply with data protection law and good practice when personal information is used for journalism. It has also published reference notes to support the Code, containing more information about the legislation and case law examples. The code is limited to the ICO’s regulatory remit for data protection law and does not concern media standards in general. The code is also generally well-aligned with, and is intended to complement, existing industry codes. The ICO was required by Parliament to produce the code, which builds upon guidance for the media published in 2014 following a recommendation from the Levenson inquiry. It is a statutory code under section 124 of the Data Protection Act 2018.

Court of Appeal upholds validity and infringement of Optis telecommunications SEPs

The Court of Appeal has issued its ruling in Optis Cellular Technology LLC and others v Apple Retail UK Limited and others [2023] EWCA Civ 758. It dismissed an appeal by Apple against the Patent Court’s decision that telecommunications patents owned by Optis and declared to be standards essential patents were valid and infringed. The judge in the Patents Court had correctly concluded that a mobile device had to be capable of operating with the relevant code multiplexing structure when required. However, the mobile was not restricted to a scenario in which that structure was in use. The Court of Appeal considered the claim wording, the specification wording, the nature of the invention, the judge’s conclusion on claim construction, the judge’s view of infringement and the issue of anticipation.

Patents Court considers confidentiality in FRAND case

The Patents Court has issued its ruling in Interdigital Technology Corp and others v Lenovo Group Ltd and others [2023] EWHC 1577 (Pat). The court had to decide if some of the confidential information redactions in the current public version of the July FRAND judgment could be removed. There was universal agreement that the applicable principles are those set out by Birss J. in his judgment on confidentiality in Unwired Planet v Huawei [2017] EWHC 3082 (Pat). The judge recognised that significant costs had been incurred on confidentiality issues in the FRAND proceedings by InterDigital, its licensees and other third party data providers. Lenovo had also incurred significant costs in dealing with these issues, albeit to a lesser extent than InterDigital because none of Lenovo’s confidential information was in play in the FRAND judgment. A lot of these costs could not be avoided. The Judge said that the principal balance he tried to strike in his approach to redaction was between the continued protection of commercially sensitive information (in particular the rates and conditions in current or recently expired licences) and ensuring that the public version of the FRAND Judgment sets out the important parts of the Judge’s reasoning (which may require some details of licences key to the reasoning and/or of historic licences to be made public). He said that assuming his approach was either not challenged or is upheld, it was to be hoped that the costs of this type of final confidentiality hearing can be considerably reduced in the future, on the basis that the Court can be expected to adopt a similar line to that set out in Unwired Planet and in the judgments in these proceedings.

UK government issues call for information on use of private telecoms

The government has launched a public call for information on the uses and security of private telecoms networks in the UK. These are networks that provide bespoke services to closed user groups and are different to public telecoms networks, which supply a standard service to individuals or businesses, relying on common infrastructure. The call for information will help the government develop its understanding of the private telecoms market, including the technologies being deployed, the sectors using these networks, and the security measures taken to protect them. This information will be used to determine if any government intervention is required to promote the security and resilience of private telecoms networks. The call for information closes on 13 September 2023.

EU law

European Commission announces investigation into Amazon acquisition of iRobot

The European Commission has opened an in-depth investigation to assess, under the EU Merger Regulation, the proposed acquisition of iRobot by Amazon. The Commission’s preliminary investigation indicates that the transaction may allow Amazon to: (i) restrict competition in the market for manufacturing and supply of robot vacuum cleaners; and (ii) strengthen its position in the market for online marketplace services to third-party sellers (and related advertising services) and/or other data-related markets. The Commission will now carry out an in-depth investigation into the effects of the proposed transaction to determine whether its initial competition concerns are confirmed. It has 90 working days, until 15 November 2023, to take a decision. The opening of an in-depth inquiry does not prejudge the outcome of the investigation. The CMA is also investigating the acquisition.

Advertising through influencers and its impact on consumers

The EESC has issued a report on influencers. It calls for the administrators of platforms and social media networks to: be jointly and severally liable for illegal content published by content creators/influencers; be obliged to take the necessary action to neutralise the illegal online communication and report the illegal activity to the competent authority; require all content creators/influencers operating outside the EU to identify the clear legal liability within the EU and to hold professional indemnity insurance in case of harm caused by unlawful content. It also believes that this should consider criteria such as: influencers identifying the advertising nature of their messages subject to sector-specific rules, to protect the health and safety of consumers and users, especially minors and other vulnerable groups; considering the breach of rules to be an infringement committed by the influencer, without prejudice to the joint and several liability of advertisers and platforms and social networks. In addition, it considers that special attention should also be paid to the use of dark patterns, the improper or disparaging use of trade marks, unauthorised financial products, and identify theft or fake influencers using the images of well-known people without their knowledge.