• IP BLAWG

    Bootleg CDs Have a Lot of Kick

    Beverly A. Berneman
    Tuesday, 25 October 2016

    Criminal copyright infringement can get you kicked out the U.S. Raul Zaragoza-Vaquero has been in the U.S. for less than 5 years. Raul sold bootleg CDs. Raul’s business model got him convicted of criminal copyright infringement. But his troubles didn’t end there. The Immigration and Nationality Act allows the deportation of someone who engages in crimes involving moral turpitude. So immigration authorities started proceedings to deport Raul. Raul appealed to the U.S. Dept. of Justice’s Board of Immigration Appeals to allow him to stay in the U.S. He lost. Although there was little precedent for it to rely on, the Board ruled that copyright infringement is a crime involving moral turpitude. The Board relied heavily on precedent in criminal trademark infringement cases and other theft type cases. The Board also looked to the legislative intent that copyright infringement enforcement was an important priority.

    WHY YOU SHOULD KNOW THIS. Copyright infringement has both a civil and a criminal aspect. In criminal copyright infringement, the offender knew that he or she was committing a crime such as selling bootleg CDs or DVDs. Civil copyright infringement is a strict liability cause of action which means that intent is not necessary. The penalties for civil infringement won’t send you to jail but the potential infringement damages can be staggeringly high. Of course, it’s best not to commit copyright infringement at all.

  • IP BLAWG

    The Perils of the Merely Descriptive Trademark

    Beverly A. Berneman
    Wednesday, 19 October 2016

    If you use a phrase to describe your product, it probably isn’t a trademark. Simone Kelly-Brown registered the phrase “Own Your Power” in a special form (see the first picture). When Oprah Winfrey’s “O” Magazine used the same phrase on its cover (second picture), Kelly-Brown sued for trademark infringement. The case took a tortured path up and down from trial court to appellate court to trial court and back to appellate court. In the end, the Second Circuit Court of Appeals affirmed summary judgment for Oprah and her publisher. The Court held that Kelly-Brown’s use of the phrase was merely descriptive of her products and services. Oprah demonstrated that the phrase had been in use since at least 1981. Oprah, herself, used the phrase in a 1993 commencement address which predated Kelly-Brown’s use of the phrase. Kelly-Brown tried to argue that the mark had acquired secondary meaning because the consuming public had come to identify the mark with her goods and services. But, the trial court held that Kelly-Brown didn’t have enough proof to support her position.

    WHY YOU SHOULD KNOW THIS. Descriptive words do not a trademark make. But, when descriptive words acquire secondary meaning, they can be registered as a trademark. A descriptive mark acquires secondary meaning when consumers have come to identify a trademark with a certain product over time. This means that the primary significance of the descriptive mark is to connect the product or service with the owner of the mark. It’s easy to fall into the trap of adopting a descriptive mark because it, well, describes the goods and services. As Kelly-Brown learned after years of litigation, a descriptive mark can be difficult, if not impossible to protect.

  • IP BLAWG

    Only Clean Hands Need Apply

    Beverly A. Berneman
    Tuesday, 11 October 2016

    Translating a word incorrectly can put a trademark registration at risk. Aachi Spices & Foods brought a proceeding before the TTAB to cancel Kalidos Raju’s trademark registration for “Aachi” for various food products. Aachi alleged that Raju’s registered trademark interfered with its prior rights in a mark using the same word. Raju defended the proceeding by claiming that Aachi Spices & Foods was guilty of “unclean hands”. “Unclean hands” is an equitable doctrine that prevents a party from relying on its registration if it made a false statement during the trademark application process. According to Raju, Aachi Spices & Foods translated the word “Aachi”, to mean ‘distinguished lady’. Raju said that the word really means ‘grandmother’. The TTAB found evidence that the word is translated in different ways including both of the proposed translations. Aachi Spices & Foods’ petition to cancel Raju’s registration was granted.

    WHY YOU SHOULD KNOW THIS. When applying to register a trademark, an applicant has to attest that all of the information given on the application is true and correct. If it isn’t, any future registration could be cancelled. When using a foreign word in trademark, the translation is important because an examining attorney will research prior uses of the English translation of the word to determine if there’s a likelihood of confusion with prior pending applications and registrations. In this case, both the petitioner and the respondent had different translations for a foreign word. The TTAB found that neither of the proposed translations would be understood by those speaking the language. That will not always be the case. So, for anyone seeking to register a trademark that includes a foreign word, it’s better to include all possible translations of a foreign word in a trademark application.

  • IP BLAWG

    Link Separation Anxiety

    Beverly A. Berneman
    Tuesday, 27 September 2016

    A link to another website might get you in trouble. Many websites include links to other websites. It’s a useful way to build browser traffic to the website and to benefit the linked website. But what happens if clicking on the link sends your user to a website that’s infringing on someone’s copyright? In the U.S., most courts have held that linking isn’t contributory copyright infringement because there’s usually no way to control or stop the infringement on the linked website. Due to a recent case in Europe, the same may not be true in the E.U. The Court of Justice of the E.U. ruled in GS Media BV v. Sanoma, that linking to a website that contained infringing material was infringement. The E.U. court held that the defendant was liable because it knew or had reason to know that the link sent a user to a website with infringing material.

    WHY YOU SHOULD KNOW THIS. In the U.S., we have three types of copyright infringement: (1) direct; (2) contributory; and (3) induced. The law surrounding the different levels of infringement is well developed. In each type, the element of intent plays an important role. If the originator intended to infringe or help another to infringe, then the originator is liable for copyright infringement. The GS Media decision goes beyond intent and rests on “knew or should have known”. Of course, to know or should know something and then go ahead can rise to the level of intent. But, it’s not always evident if a linked website contains infringing material. The most troubling is the “should have known” prong. Exactly what does “should have known” entail? It’s a slippery standard to try to prove and defend. Hopefully, U.S. courts will not adopt this standard. (Photo Courtesy of www.onewaystock.com)

  • IP BLAWG

    Copyright Law Levels the Sims' PlumbBob

    Beverly A. Berneman
    Tuesday, 20 September 2016

    Copyright Law may be the key to who owns the design of a video game promotional item. In the popular video game, the Sims, a green icon called a “PlumbBob” identifies the character in play. The game’s manufacturer, Electronic Arts, Inc. decided it would be a great idea to include a USB drive that looked like the PlumbBob as a promotional item to be sold with the games. EA hired Lithomania who hired Direct Tech to make up a prototype and eventually manufacture the item. Lithomania then sent the prototype to a Chinese company to manufacture the USB for less than what Direct Tech was going to charge. Lithomania didn’t tell Direct Tech. Instead, it strung Direct Tech along with a series of agreements including an agreement to assign the IP in the USB. Direct Tech didn’t realize it lost the sale when the PlumbBobs appeared in stores. Direct Tech sued Lithomania for breach of contract and they settled. Then Direct Tech sued EA for copyright infringement and trade secret misappropriation. The district court granted summary judgment to EA. The 9th Circuit Court of Appeals affirmed summary judgment on the trade secrets claim. But the Court reversed and remanded on the copyright claims. There were two issues of fact, namely: (1) whether the USB design was copyrightable because it was conceptually different from the utilitarian aspects of a USB; and (2) whether the USB design is a sufficiently original and non-trivial version of the original to be considered a derivative work.

    WHY YOU SHOULD KNOW THIS. The answers to the two questions remain to be seen. But let’s do a post-mortem on the actions of the parties. When EA retained Lithomania, their agreement should have been clear about ownership of the Intellectual Property rights to the promotional item. To further protect EA, it should have required Lithomania to get its approval on any agreements with subcontractors and agents. As to Lithomania, what can one say about its opportunism at the expense of everyone else? For Direct Tech, it’s more a matter of 20/20 hindsight. How was Direct Tech to know that Lithomania was not being candid with it? At least Direct Tech has an opportunity to recoup its lost profits using its copyright claims.

  • IP BLAWG

    An Early Thanksgiving for AT&T

    Beverly A. Berneman
    Tuesday, 30 August 2016

    AT&T announced a loyalty program called “AT&T Thanks”. Citibank had some problems with that. Citibank thought the “AT&T Thanks” trademark would cause customer confusion with its loyalty program called “Thank You”. Citibank brought suit. Citibank argued that if anyone complains about AT&T’s rewards program, it would reflect badly on Citibank’s loyalty program. The court determined that the factors of customer confusion are either neutral or weigh against it. The court pointed out that customers seemed to be able to tell the difference among a wide variety of customer loyalty programs that use “Thank You” or some variation of it. So, they should be able to see the difference between a loyalty program for telecommunications services (AT&T) and one for financial services (Citibank). The judge denied Citibank’s motion for preliminary injunction.

    WHY YOU SHOULD KNOW THIS. Citibank, AT&T and a substantial number of other businesses want to thank their customers by offering loyalty incentives. But how many different ways can you say “Thank You”? Not many. Citibank learned it couldn’t "corner the market" on a frequently used phrased.

  • IP BLAWG

    Typos Hapne

    Beverly A. Berneman
    Tuesday, 23 August 2016

    Carpenters have a saying: "measure twice, cut once”. This opening line from a recent 7th Circuit Opinion says it all. Final Call sold over a hundred copies of Jesus Ali’s portrait of Nation of Islam leader, Louis Farrakhan, without Ali’s permission. Ali sued Final Call for copyright infringement. The trial court relied on authority from the 7th Circuit that, through a typo, incorrectly shifted the burden of proof of an affirmative defense from the defendant to the plaintiff. While taking some responsibility for the error, the 7th Circuit reversed and remanded for assessment of damages.

    WHY YOU SHOULD KNOW THIS. All legal drafting creates a breeding ground for potential ambiguities, misdirection and opposite meanings. Leaving off a little word like “not” or using “and” instead of “or” can completely change the meaning of a contract, a statute or a legal opinion. When a court opinion makes a critical mistake, parties can be burdened with incorrect precedent. Luckily, the 7th Circuit recognized its mistake in this case thereby assuring correct legal authority for future copyright infringement plaintiffs.

  • IP BLAWG

    Marijuana Trademark Gets Busted

    Beverly A. Berneman
    Tuesday, 16 August 2016

    The USPTO won’t register a trademark for the sale of marijuana. Morgan Brown tried to register the name of his Washington State store, Herbal Access, as a trademark for the sale of “herbs”. Morgan’s specimen of use was a picture of the store with a neon green cross on it. For those not in the know, the green cross signals the location of a medical marijuana dispensary. Seeing that, the intrepid examining attorney visited Morgan’s website and, sure enough, Morgan sold marijuana. The examining attorney refused registration based upon an unlawful use of the trademark in commerce. While the State of Washington allows the sale of medical marijuana, federal law does not. Registration would be barred as long as it’s a federal offense to sell marijuana. The refusal was confirmed on appeal to the TTAB.

    WHY YOU SHOULD KNOW THIS. Morgan’s experience points to the little known list of matters that can’t be trademarked. In addition to illegal matters, they include: (1) immoral, deceptive or scandalous matter; (2) the flag of any nation and any US state or municipality; (3) the name, likeness etc. of a living individual without their consent and of a deceased president during the lifetime of their surviving spouse; and (4) a geographically misdescriptive name in connection with wine and spirits. Getting back to Morgan, there are a few unanswered questions. Could Morgan have done anything different to at least get registration for the other "herbs" he sells? Maybe. Could he have submitted a specimen that was related to legal herbs only? It would have been worth the try. At least he might have gotten a registration for the legal parts of his business. Could Morgan have tried to register the trademark with the Washington State Trademark Office? Probably. It could have given him protection for use of the name in connection with marijuana within the State of Washington.

  • IP BLAWG

    Liking Something Isn't Like Owning Something

    Beverly A. Berneman
    Tuesday, 09 August 2016

    Liking something on a Facebook page is not a form of Intellectual Property. Stacy Mattocks created an unofficial Facebook fan page for the television series, “The Game”. Black Entertainment Television LLC (“BET”) acquired the rights to the show. BET allowed Stacy to use the trademarks and content on her fan page. BET even directed users to “like" Stacy’s fan page. BET was going to hire Stacy for a full time position. Negotiations broke down and Stacey didn’t get the job. BET instructed Facebook to migrate the page to BET. Stacy sued BET for stealing the “likes” on her Facebook page. The court held that Facebook “likes” can’t be stolen because they’re not a form of Intellectual Property.

    WHY YOU SHOULD KNOW THIS. Intellectual Property isn’t a catchall for rights protection. Sometimes, a company generates information or data that can be protected even if it doesn’t fall squarely into one of the Intellectual Property categories of patents, copyrights, trademarks and trade secrets. For instance, the Illinois Supreme Court held that the data compiled by Dow Jones is protectable because Dow Jones only gives the information to authorized licensees. Likes on a Facebook page don’t reach that kind of protectability. Even though Stacy lost this one, we have to give her credit for asserting a novel theory.

  • IP BLAWG

    OMG! Your Text Messages Could Be a Contract

    Beverly A. Berneman
    Tuesday, 26 July 2016

    Be careful what you text because you may end up a party to contract. A court in Massachusetts held that the texts between two real estate sales agents resulted in a binding contract. In most states, contracts for the sale of real estate have to be in writing. This is called the Statute of Frauds. The writing has to be signed by both parties and contain sufficiently complete terms and an intention to be bound by those terms. The court held that the e-mails and texts between the agents filled all of the requirements of a binding written contract.

    WHY YOU SHOULD KNOW THIS. Not all contracts come under the strict requirements of the Statute of Frauds. Our technology driven society facilitates an ease of communications that the creators of the Statute of Frauds never envisioned. So a string of e-mails and text messages can have unintended consequences of creating a contract. Then the parties could end up in litigation over the formation and enforceability of a contract.

  • IP BLAWG

    A Noble Battle Comes to an End

    Beverly A. Berneman
    Tuesday, 12 July 2016

    The NOBLE HOUSE trademark got lost in a corporate muddle. Floorco Enterprises LLC claimed that it was using the NOBLE HOUSE trademark for furniture since 2010. The problem? Floorco wasn’t really using the mark. Its parent company, Furnco International Corp. was. And even then, Furnco was only using it sporadically. Noble House Home Furnishings filed a cancellation proceeding. The reason is simple . . . well, not quite. A parent company’s use of a mark can inure to the benefit of its subsidiary. But a subsidiary’s use does not inure to the benefit of the parent. Since, Floorco wasn’t using the mark, it was deemed abandoned. The TTAB canceled Floorco’ s trademark.

    WHY YOU SHOULD KNOW THIS. It’s all about control. The parent controls the subsidiary. But the subsidiary doesn’t control the parent. Trademark use is also about control. You can’t allow someone to use your trademark without control over how they use it. Floorco had the registration but no control over Furnco. Assuming that Furnco’ s sporadic use was enough to preserve the trademark, a license agreement between Floorco and Furnco might have avoided the cancellation.

  • IP BLAWG

    A Serious Dent in a Patent Pirate's Treasure

    Beverly A. Berneman
    Tuesday, 28 June 2016

    SCOTUS tells the Federal Circuit to back off of patent damages rules. Under the Patent Act, a court may increase the damages up to three times of a judgment. Last year, in two decisions, the Federal Circuit Court of Appeals imposed strict limits on the plaintiffs’ ability to get enhanced damages. The Federal Circuit required a plaintiff to show two things: (1) that there was a high likelihood that the infringer’s actions constituted infringement; (2) that the infringer knew the risk. Under this standard, any defense by an accused infringer that was not frivolous would get them off the hook. SCOTUS reversed the Federal Circuit recognizing that the Patent Act left enhanced damages to the discretion of the trial court. SCOTUS acknowledged that Federal Circuit’s test was trying to keep enhanced damages for egregious cases only. But the test was too rigid. Justice Roberts wrote: “[The] threshold requirement excludes from discretionary punishment many of the most culpable offenders, such as the “wanton and malicious pirate” who intentionally infringes another's patent—with no doubts about its validity or any notion of a defense—for no purpose other than to steal the patentee's business.” The two cases will go back to the trial courts to determine the availability of enhanced damages using a less rigid and more neutral test.

    WHY YOU SHOULD KNOW THIS. This decision demonstrates a tension between a trial court and an appellate court. The trial court hears the evidence and decides the facts while applying the laws. The appellate court is supposed to determine whether the court below decided the facts according to the law. In these cases, SCOTUS decided that the appellate court had overreached and encroached on something that should be left to the trial court. The Patent Act recognizes that in certain egregious situations, the willful infringer should pay not only actual damages but enhanced damages to punish the infringer and further compensate the plaintiff. The Federal Circuit’s rigid test wasn’t warranted by the Patent Act and interfered with the trial court’s ability to award enhanced damages.

  • IP BLAWG

    Summer 2016 Update

    Beverly A. Berneman
    Tuesday, 21 June 2016

    Sometimes, the last word isn’t really the last word. Here are some updates for previous posts:

    Browsing Isn’t a Virtual Handshake Deal (November 17, 2015). Since this post, another court has spoken on the unenforceability of on-line agreements. The Seventh Circuit Court of Appeals affirmed dismissal of a demand for arbitration based upon an alleged on-line click wrap agreement in Sgouros v. TransUnion Corp. The Court analyzed the user experience and determined that on-line customers were not sufficiently notified that their purchases were subject to a Services Agreement that included an arbitration clause “buried on page 8”.

    Apple v. FBI (February 23, 2016). Since this post, a third party came forward and helped the FBI unlock the IPhone. Keep in mind that the IPhone in question is an older model. Newer models of the IPhone have different encryption and security software.

    Fear the Walking Trademark Zombies (March 22, 2016). Since this post, Macy’s Department Stores has brought a motion for sanctions and damages against Strategic Marks. Macy’s alleges that the principal of Strategic Marks violated a confidentiality clause in the settlement agreement by announcing “We won”. The moral of this story is (1) if you settle, you don’t win or lose; and (2) Don’t breach a confidentiality clause no matter how tempting.

  • IP BLAWG

    Ice Cream War

    Beverly A. Berneman
    Tuesday, 14 June 2016

    Just in time for summer, Mister Softee gets its just desserts courtesy of a federal judge. The war started when Dimitrio Tsirkos decided to rebrand his “Mister Softee” trucks as “Master Softee”, including mimicking the graphic of the delicious ice cream cone. Tsirkos was a former vendor of the venerated purveyor of the taste of summer. As a vendor, Tsirkos had to pay royalties. As a non-vendor, he got out of having to pay Mister Softee. Mister Softee sued and obtained an injunction permanently enjoining Tsirkos from operating his rogue ice cream trucks using confusingly similar branding. Tsirkos refused to surrender. He continued to operate his Master Softee trucks despite the injunction. A federal court judge held Tsirkos in contempt repeatedly and ordered him to pay $329,000.00 in damages. When he still wouldn’t stop, the court entered another order adding $287,258.00 in attorney’s fees and $52,605.00 in costs.

    WHY YOU SHOULD KNOW THIS. There are three lessons here. The first is the obvious one. If you’re enjoined from doing something, you stop doing it. The second is how to properly rebrand. Tsirkos’ rebranding was pretty obvious trademark infringement. If he was going to rebrand he could have chosen a way to still get his message across without trying to confuse the public. The third is the cost effectiveness of fighting a fight that has little chance of success. The estimated annual royalty fee is about $3,400.00 per truck. Tsirkos operated 16 trucks. So his royalty payments were about $54,400.00 a year. The total judgment would have paid for about 12 years of royalties. Maybe the royalties weren’t so bad after all.

  • IP BLAWG

    The Phantom of the Trademark Office

    Beverly A. Berneman
    Tuesday, 07 June 2016

    A phantom trademark can be exorcised. A 'phantom trademark' is in which an integral portion of the mark is represented by a blank or missing information. The USPTO will refuse registration of a phantom mark because it would be hard for someone to identify and distinguish the goods and services covered by the mark. Enterprise Holdings, Inc. got caught in the vortex of phantom marks when it tried to register this trademark for vehicle dealerships, fleet management services and vehicle rental services. The examining attorney refused registration on the basis that the mark was missing information. Part of the problem was that the specimens of use each separately showed the mark with added words “car sales”, “commercial trucks” and “fleet management” in the bottom white space. The examining attorney called this ‘mutilation’ of the mark. Enterprise Holdings, Inc. wouldn’t take no for an answer and appealed to the TTAB. The TTAB reversed the refusal. The TTAB held that the added terms were generic descriptions and could not function as a trademark alone. The added terms can be deleted from the mark without changing the commercial impression.

    TAKE AWAY. This decision is good news for anyone registering a basic trademark that will be used for a family of goods and services. You can come up with a basic design and add generic terms to differentiate separate lines of goods and services. And you don’t have to register each and every version of the mark to get protection.

  • IP BLAWG

    A Tale of Two Structures

    Beverly A. Berneman
    Tuesday, 24 May 2016

    It looks pretty; but how protectable is it? Two recent cases highlight how different types of IP law protect the structure of a product. In one case, In DeVinci Editrice S.r.l. v. Ziko Games LLC, a court held that the structure of the “Bang!” card game cannot be protected by copyright. While the plaintiff could copyright the artwork on the cards, the game structure, mechanics and rules are not protectable. Millennium Laboratories, Inc. v. Ameritox, Ltd., a court held that the structure of medical test reports can be protected as trade dress as long as the structure isn’t functional. In this case, the owner chose the structure because it didn’t look like any of its competitors’ reports.

    WHY YOU SHOULD KNOW THIS. Functionality. That’s the key. Functionality can destroy copyright or trade dress protection. Both copyrights and trade dress protect something beyond function. Copyright requires the work have at least a minimum amount of creativity and be fixed in a tangible means of expression. An arrangement of items, a recipe or a set of instructions are primarily functional and not protectable. But add a creative element like commentary, graphics, photos or an unusual arrangement of information and you have protectable elements. For trade dress, the protectable element has to be something more than the visual appearance of a product. As discussed in the blog post of 5/3/2016, trade dress protection arises when consumers can identify a source or product by elements of the design beyond the function. So both copyrights and trade dress require the work or design to rise above functionality.

  • IP BLAWG

    A Sword and a Shield for Your Trade Secrets

    Beverly A. Berneman
    Tuesday, 17 May 2016

    President Obama signed the Defend Trade Secrets Act (“DTSA”) into law on May 11, 2016. It was a long time coming but we’re glad it’s here.

    The DTSA amends the Economic Espionage Act of 1996 to create a federal private cause of action for trade secret misappropriation. Some of the significant provisions are: (1) you can bring an action in federal court; (2) state law causes of action are preserved; (3) immunity for whistle blowers who disclose trade secrets in reporting a suspected violation of the law; (4) limits on injunctive relief if it will interfere with person’s ability to enter into an employment relationship; and (5) the ability to obtain a seizure order without notice in extraordinary circumstances.

    WHY YOU SHOULD KNOW THIS. Trade secrets have always been a bit of a stepchild in the IP arena. The 3 other major types of IP, patents, copyrights and federally protected trademarks, are governed by federal statutes. Trade secrets have now stepped into the realm of federally protected IP. The DTSA hasn’t changed the basics. Protection for trade secrets still requires proper identification and reasonable measures to prevent disclosure. However, the DTSA has some twists and turns that need to be properly navigated. For instance, employers have to give employees notice of the whistle blower immunity. And an employer can’t prohibit a former employee’s new employment just because the employee has knowledge that would inevitably result in the use of trade secrets (known as the “Inevitable Disclosure Doctrine”).

  • IP BLAWG

    Bad Reviews Live Forever; Or Not

    Beverly A. Berneman
    Tuesday, 10 May 2016

    Fake bad reviews are worse than real bad reviews. A competitor of Romeo & Juliette Laser Hair Removal, Inc. posted fake bad reviews on Yelp.com and CitySearch.com using fake accounts. Romeo & Juliette sued the competitor because it was losing customers. The competitor’s defense was “hey, I’m out of business so you can’t touch me.” Not quite. Recognizing that false comments posted on the Internet have an immeasurable detrimental effect, the judge hearing the case entered a permanent injunction requiring the removal of the false reviews.

    WHY YOU SHOULD KNOW THIS. Fake bad reviews are beyond annoying. They can cause an unjustifiable loss of reputation and diminution in revenue. Romeo and Juliette was lucky. It was able to find the fake reviewer. That’s not always easy. Discovering who posted the false reviews can be costly and time consuming. Most review sites have procedures for dealing with fake reviews. But that may not be enough. If the fake bad reviews continue and really hurt a business, there may be no alternative to litigate. The trick is finding the right party to sue.

  • IP BLAWG

    All Dressed Up and Going Everywhere

    Beverly A. Berneman
    Tuesday, 03 May 2016

    Trade dress can help protect the look and feel of a website. Many businesses put a lot of time and effort into their websites. With good reason. A website is the perfect place to show what the business can do and how it does it. But how can a business protect its well-designed website from being mimicked by a competitor? In Ingrid & Isabel, LLC v. Baby Be Mine, LLC, a California federal court denied the defendant’s motion for summary judgment on the issue of whether the plaintiff’s website could be protected as trade dress. In doing so, the court acknowledged that the "look and feel" of a website qualifies for trade dress protection.

    WHY YOU SHOULD KNOW THIS. Trade dress refers to the visual appearance of a product, packaging or design. Trade dress is protected by the Lanham Act which also protects trademarks. However, registering trade dress has pitfalls. For instance, a website might not be inherently distinctive. So the applicant will have to show that the website has acquired distinctiveness. Also, the elements of design related to trade dress cannot be functional. If you look at the Coke bottle, one of the most famous examples of trade dress, you can see that the line between function and design can be tricky. In the end, a carefully crafted and researched trademark application would probably avoid the pitfalls.

  • IP BLAWG

    I Love This Game (Someone Paid Me to Say This)

    Beverly A. Berneman
    Tuesday, 26 April 2016

    The FTC had a problem with Machinima, Inc. for not telling anyone that it paid people to post endorsements. Machinima describes itself as the dominant network for fandom and video gamer culture. Its services include distribution, support and monetization of YouTube channels. Things went sideways for Machinima when it paid ‘influencers’ to post YouTube videos that were supposed to be objective opinions about Microsoft’s Xbox One system. The FTC issued an administrative complaint against Machinima for failing to adequately disclose that the influencers were being paid for their opinions. Jessica Rich, Director of the Bureau of Consumer Protection summed it up well. “When people see a product touted online, they have a right to know whether they’re looking at an authentic opinion or a paid marketing pitch. . . That’s true whether the endorsement appears in a video or any other media.” The FTC and Machinima have agreed to settle. Machinima will be prohibited from similar deceptive conduct in the future and it must ensure its influencers clearly disclose when they have been compensated in exchange for their endorsements.

    WHY YOU SHOULD KNOW THIS. It’s ok to pay someone to endorse your product or service. As long as you disclose that it’s a paid endorsement.

  • IP BLAWG

    Tort Reform and IP Law Meet Cute

    Beverly A. Berneman
    Tuesday, 19 April 2016

    The passive licensor can find itself on the receiving end of a huge strict liability judgment. Or not. Strict liability means if you’re anywhere in the chain of commerce of a defective product, you’re liable for damages caused by it. This can be really harsh for passive trademark licensor who does nothing more than license a name of the product. Tort reform has been trying to find ways to lessen the hit on anyone who is in the chain of commerce but really had nothing to do with the design or manufacture of the product. The defendant in Shukrullo Dzhunaydov v. Emerson Elec. Co., et al., licensed the trademark of what turned out to be a defective product. The license allowed the defendant/licensor to inspect the use of the trademark and have some control over the product. But it didn’t exercise those rights. The court held that the defendant/licensor wasn’t liable for damages caused by the defective product.

    WHY YOU SHOULD KNOW THIS. A trademark license has to give the licensor some sort of quality control over the use of the licensed product or service. Otherwise it’s a “naked license”. A naked license will cause the licensor to lose rights in the trademark. Here’s the problem. The trademark licensor must exercise sufficient control over the product to protect trademark rights, but not have sufficient control over the product to be liable under a strict liability theory. The defendant/licensor in Shukrullo Dzhunaydov had the ability to exercise control of the product but didn’t. That’s risky for the licensor’s trademark rights although it certainly helped on the strict liability issue. A carefully drafted license agreement should help balance the risks.

  • IP BLAWG

    Alice's Topsy Turvy IP Protection

    Beverly A. Berneman
    Tuesday, 12 April 2016

    The answer to being ousted from the wonderland of patents is to go through the looking glass to copyrights. Since SCOTUS’ 2014 decision in Alice Corp. v. CLS Bank International, over 70% of software patents have been struck down as being too "abstract". In answer to this, Synopsys registered its software code for static timing analysis (STA) with the U.S. Copyright Office. When AtopTech started selling STA that was eerily close to the one belonging to Synopsys, Synopsys sued for copyright infringement. A jury awarded Synposys over $30 million in damages against AtopTech.

    WHY YOU SHOULD KNOW THIS. The Alice decision has created a tumultuous time for software protection. Without patent protection, software developers and their counsel had to come up with other ways to protect the code. As Synopsys showed us, copyright protection is a viable alternative. But it’s not a one size fits all solution. Software might also be protectable as a trade secret. So, software needs to be evaluated on a case by case basis to determine the appropriate method of protection.

  • IP BLAWG

    The New York Yankees Didn't Get the Joke

    Beverly A. Berneman
    Monday, 04 April 2016

    The New York Yankees were not amused when someone tried to register parodies of its famous trademarks . IET Products thought it would be funny to register trademarks that parodied the New York Yankees longtime logo and catch phrase. IET replaced the bat on the logo with a syringe referring to alleged steroid use by the players. Not willing to stop there, IET also sought to register “The House that Juice Built” as a parody of the famous catch phrase “The House that Ruth Built” (meaning Babe Ruth for the initiated). The TTAB refused to allow registration of IET’s marks. The TTAB reasoned that IET wasn’t really interested in making commercial use of the marks because they were going to be used as an “ornaments” on IET’s goods.

    WHY YOU SHOULD KNOW THIS. In honor of the opening of the 2016 baseball season, we discuss the parody of famous baseball trademarks. A parody of a trademark is not really a source or product identifier. Rather, it is a non-commercial use that comments on or makes fun of the original. So IET could probably still adorn T-shirts and baseball caps with its parodies. But, it can’t register the parodies as trademarks. Can the Yankee’s stop IET some other way? The TTAB addressed that issue even though it really wasn’t part of the proceedings. The TTAB surmised that if the Yankees brought a federal trademark dilution claim, IET may be able to use parody as a fair use defense.

  • IP BLAWG

    Some Updates

    Beverly A. Berneman
    Tuesday, 29 March 2016

    Sometimes, the last word isn’t really the last word. Here are some updates for previous posts:

    Dancing Baby Has a Partial Reason to Keep on Groovin' (September 22, 2015). Since this post, the 9th Circuit Court of Appeals amended its opinion to clear up a couple of things. First, the amended opinion clarifies that the original opinion didn’t mean to endorse using an algorithm to determine fair use. In other words, the copyright owner can’t automate the fair use analysis. Second, the amended opinion removed the suggestion that the fair use consideration doesn’t need to be thorough. This is all more good news for the Dancing Baby’s mother.

    Happy Birthday to All of Us (October 20, 2015). Since this post, someone else stepped forward claiming to be the owner of the song. In the end, all parties settled. Under the terms of the settlement, (1) Warner/Chappell has to give back about $14 million in royalties it collected; (2) none of the claimants are going to demand royalty payments in the future; and (3) the court declared that the Happy Birthday lyrics are in the public domain.

    “Bleeping” Trademarks (January 12, 2016). Since this post, USPTO published a formal guide for examiners requiring suspension applications seeking to register offensive and disparaging marks. The buzz is that the USPTO is going to appeal The Slants and similar rulings to determine whether these types of trademarks are protected by First Amendment free speech. Until then, examiners are to issue “advisory refusals”.

    Can I Copyright This? (March 1, 2016). Since this post, the U.S. Supreme Court refused to hear an appeal of the ruling that the Batmobile can be protected by copyright because its bat-like appearance and high-tech gadgets make it a fictional character.

  • IP BLAWG

    Fear the Walking Trademark Zombies

    Beverly A. Berneman
    Tuesday, 22 March 2016

    If you don’t use your trademark, it could become a zombie.  Macy’s Department Stores has been absorbing local department stores and their trademarks for decades. Once Macy’s takes over, it rebrands the store. But, those old department store trademarks still exist in the minds of the consuming public. In other words, the dead trademarks became zombies. Seeing the marketing potential of zombie trademarks, Strategic Marks started selling T-shirts using them. Macy’s filed a trademark infringement suit against Strategic Marks and won. It helped that Macy’s hadn’t really abandoned most of the trademarks. It was using them in its “Heritage Collection”. In the end, the parties settled and Macy’s transferred some trademarks to Strategic Marks.

    WHY YOU SHOULD KNOW THIS. If you stop using a trademark for more than 3 years, the law presumes that you abandoned it. Then someone can start using your trademark and get a free ride on the goodwill you established. If you stop using a trademark but intend to revive it in the future, there are steps you can take to escape the 3 year presumption. Of course, this isn’t a problem if the original owner is out of business or has no intention to revive the trademark. For instance, Leaf Brands revived “Hydrox” for cookies after it confirmed that the owner of the trademark had no interest in resurrecting the brand.