Business divorces can put trademarks in limbo. %CUT% Devon Johnson and Latresa Moore launched the fashion and lifestyle magazine, PYNK, in 2011. It only took two years for the team’s relationship to sour. The parting of the ways was not all that simple. Johnson kept the magazine, but hasn’t posted new content for a long time. Moore set up her own ThinkPynk website and a Pynk Magazine Instagram feed. Johnson tried to trademark the word and design mark for “Pynk”. Moore opposed registration saying that she is a co-owner and Johnson can’t register the mark alone. The TTAB granted the opposition. The board said that it wasn’t possible to delineate what intellectual property and assets remained and with whom. Since Johnson could not show that he was the sole owner, he couldn’t register the marks.

The super-powers of technology have decided to address the increasingly convoluted and confusing world of patents. %CUT% Google, Amazon, Intel, Dell, Cisco, Oracle, Salesforce and Adobe are all on the same virtual page. Members of this illustrious group of tech companies recognize that innovation in the form of new and better products is fundamental to economic growth and American jobs. But, there is a “patent quality crisis” of baseless patent assertions and active patent troll litigation. So these tech super-powers have banded together to form the “High Tech Inventors Alliance” ("HTIA"). The goal is to advocate for a balanced patent policy both in the application process and in the courts. They intend to speak up when tech issues are debated in the courts, the Patent and Trademark Office and the media. You can visit their website at https://www.hightechinventors.com/.

If you don’t use your trademark, someone else can claim priority over you. %CUT% SPV Coach Company, Inc. filed a trademark application for ARMBRUSTER STAGEWAY in connection with vehicles, namely, customized limousines. Executive Coach Builders, Inc. opposed registration claiming that it had started using the mark before SPV and so had priority of use. The TTAB denied the opposition holding that Executive Coach had abandoned the mark. Further, Executive Coach couldn’t prove that it had any intent to resume use of the mark once it was abandoned. The TTAB cited Executive Coach’s lack of any documentary evidence and the inconsistent and contradictory testimony of its president to support the abandonment ruling. Executive Coach’s alleged use of the abandoned mark was isolated and de minimus. Executive Coach took no orders for branded vehicles. Executive Coach’s domain name didn’t identify the goods or services. Displays at Executive Coach’s plant merely showed historical and not current use of the trademark. So, SPV had priority because of its constructive use of the mark after Executive Coach’s abandonment.

News and commentary about a dad’s big oops is fair use. %CUT% Proud dad, Kali Kanongataa, accidently live streamed a video of his partner giving birth to their son. The video went viral. As often happens in the world of viral videos, Kanongataa’s video gave rise to a commentary by the media. Much of the commentary involved showing short clips from the 45 minute video. Kanongataa sued ABC, NBC, Yahoo and COED Media for copyright infringement. The judge dismissed the case on the basis of fair use. But, it didn’t stop there. The judge ordered Kanongataa to pay the defendants’ attorney’s fees. The judge said, "no reasonable lawyer with any familiarity with the law of copyright" would have filed the cases.

Similar trademarks can co-exist with the blessing of the TTAB. %CUT% Bras for Cause, Iowa, Inc. tried to register BRAS FOR THE CAUSE for charitable fundraising services. Soroptimist International of Glendale California, CA opposed registration because it wanted to register BRAS FOR A CAUSE for the same types of services. In the end, the parties settled allowing each party to use their marks. The opposition proceeding became a concurrent use proceeding. At first, TTAB refused to accept the concurrent use agreement because of concerns that the parties would be offering similar services in potentially overlapping geographic territories. This would lead to marketplace confusion. The parties submitted a revised agreement that staked out their territories so there would be no overlap. TTAB accepted the revised agreement and both parties were allowed to proceed with restricted registrations.

No matter how right you are, you need to register a copyright before filing suit. %CUT%Section 411(a) of the Copyright Act requires registration of a copyright before bringing suit. Federal Circuits are split on how to interpret this. Some circuits say filing an application is enough. Other circuits say the plain language of the statute requires actual registration. In Fourth Estate Public Benefit Corporation v. Wall-Street.com, LLC, the Eleventh Circuit Court of Appeals went with registration means registration. Wall-Street licensed content from Fourth Estate. After the license expired, Wall-Street continued to post Fourth Estate’s content without permission. Fourth Estate applied for registration and then filed suit before the works were actually registered. In affirming the dismissal of the suit, the Eleventh Circuit focused on the fact that the Copyright Office had to examine the application before registration. So filing the application can never be enough.

The unauthorized use of someone else’s subscription password can result in multi-million dollar liability. %CUT% eVestment Alliance LLC offers a subscription to its trade secret protected database of investment products and performance data. An eVestment subscriber hired Compass iTech LLC to help analyze the eVestment’s data. Compass then used the subscriber’s password about 3,000 times to download information from eVestment’s database for its own benefit. eVestment discovered the activity and shut off access to the database. Compass sued for defamation and unfair trade practices. eVestment counterclaimed. eVestment was granted summary judgment on all of Compass’ claims. On eVestment’s counterclaim, a jury found that Compass deliberately misappropriated eVestment’s trade secrets and violated the Computer Fraud and Abuse Act. The jury awarded eVestment $2.5 million in compensatory damages and $1.2 million in punitive damages.

Consider a typical retirement plan sponsored by a private employer. The employer is a fiduciary to the plan along with employees who individually serve as trustees or members of the plan’s investment or retirement committee.

The denizens of Bikini Bottom could be confused by a real Krusty Krab restaurant. %CUT% Viewers of the cartoon, SpongeBob SquarePants, are familiar with the underwater (and, of course, fictional) eatery, The Krusty Krab. When IJR Investments, LLC wanted to register the trademark, “The Krusty Krab”, for a dry land real restaurant, Viacom International, Inc., sued for trademark infringement, unfair competition and other causes of action. IJR argued that Viacom never registered the trademark and Viacom only has a fictional restaurant. So, IJR argued, it was free to use the name. The court rejected IJR’s arguments. The court looked at Viacom’s use of the name. It appeared in 166 out of 203 SpongeBob episodes over the 17 year run of SpongeBob. There were 2 successful movies and substantial merchandizing. Viacom’s substantial use for 2 decades established that the name acquired secondary meaning in the minds of consumers. Thus, Viacom had established enforceable common law rights in the name. The court entered judgment in favor of Viacom on its trademark and unfair competition claims.

The good news is that the parties settled their trade secret litigation. The bad news is the release language in the settlement agreement. %CUT% Security Camera Warehouse, Inc. sued Bowman, one of its former owners, for trade secret misappropriation. During the settlement negotiations, unbeknownst to Security Camera, Bowman still had access to Security Camera’s servers and downloaded Security Camera’s trade secrets. After the parties signed a settlement agreement, Bowman set up a new company and competed with Security Camera using the information he took during settlement negotiations. Security Camera brought a second suit against Bowman for trade secret misappropriation. The court held that Security Camera’s claims were barred by the release in the settlement agreement from the first case. The language specifically released Bowman from any claims that Security Camera may have in the future based on events that occurred before the execution of the settlement agreement.

A Star Trek and Dr. Seuss mashup will Live Long and Prosper. %CUT% Comics legend, Ty Templeton, and Star Trek’s “Trouble with Tribbles Episode” writer, David Gerrold, collaborated on a comic called “Oh, The Places You'll Boldly Go.” The comic mashed Dr. Seuss-like drawings and dialogue with Star Trek characters. The Dr. Seuss Estate sent Templeton and Gerrold a cease and desist letter citing trademark and copyright infringement. This resulted in Kickstarter shutting down the campaign to fund the development of the comic. Litigation ensued. Victory goes to Templeton and Gerrold. A California court ruled against Dr. Seuss on the trademark claim. The court held that Templeton and Gerrold’s use of the Dr. Seuss trademarks was ‘nominative fair use’. Although the court didn’t rule yet on the copyright claims, the court indicated that the use of Dr. Seuss’ copyrighted works was sufficiently transformative to be fair use.

My advertising injury may not be your advertising injury. %CUT% Many general business insurance policies cover defense of claims for ‘advertising injury.’ But what does that mean exactly? This comes up when the insured is sued for IP infringement and tenders the defense to the insurance company. Then the insurance company refuses to defend the claim because it doesn’t fit into the definition of advertising injury. In recent cases, the courts were able to give some guidance on how to analyze the duty to defend "advertising injury". Here are a few examples. In Diamond State Insurance v. 21 Century, the court held that defendant’s false and misleading statements in telephone calls to its competitor’s customers fell within the definition of advertising injury. In Sentry Insurance v. Provide Commerce Inc., the court held that the defendant’s use of Google search terms to redirect users to a competitor’s website could conceivably fall within the definition of advertising injury. In Mid-Continent Cas. Co. v. Kipp Flores Architects LLC, the court held that claims for copyright infringement stemming from an advertising idea were covered. In Sentinel Insurance Co. Ltd. v. ITD, the court held that claims of trade secret misappropriation do not fall within the definition of advertising injury.

Copyright only protects the non-standard elements of an architectural plan. %CUT% Architectural plans, by their nature, incorporate elements that have been in the public domain for centuries, such as doors, windows and types of rooms in a house. Copyright Law calls those standard elements “scènes à faire”. Home developers use a combination of standard elements to create floor plans. Sometimes, the developer comes up with a unique feature. When that happens, the developer has a copyright in the unique feature. The plaintiff in Design Basics LLC v. Lexington Homes, Inc., publishes home floor plans and licenses them on a retail basis. Design Basics sued Lexington Homes for copyright infringement of its floor plans. The 7th Circuit Court of Appeals affirmed summary judgment in Lexington Homes’ favor. The Court agreed with the District Court that a jury could not find that Lexington Homes’ plans were substantially similar to Design Basics’ plans. The graphic to the left illustrates the point by juxta positioning a Design Basics floor plan with a Lexington Homes floor plan. If you take the scènes à faire out of the equation, Design Basics seems to have very little protectable elements. But there’s more. The Court, in dicta, discussed Design Basics' litigation history and used the opportunity to criticize Intellectual Property trolls. As of April 2017, Design Basics had brought over 100 copyright infringement lawsuits. Design Basics trawled the Internet and paid employees to find "infringers". The Court expressed distaste for this type of wholesale litigation. The Court reproached plaintiffs, i.e. Intellectual Property trolls, who misuse the legal system by filing dubious lawsuits for the purpose of prompting settlements to avoid costly litigation.

The USPTO’s audit procedure sets up a ‘use it or lose it’ proposition. %CUT% The owner of a registered trademark has to file a declaration of use between the 5th and 6th year after registration and then on every 10th anniversary of registration. The USPTO will conduct random audits of about 10% of the filed declarations of use. The USPTO’s audit system will maintain the integrity of the trademark registration system by insuring that a trademark is actually being used for the registered goods and services. If the trademark owner cannot provide sufficient specimens of use, the goods or services will be deleted from the trademark registration.

Google avoided the ignominious fate of losing its trademark due to genericide. %CUT% Trademark protection extinguishes when the trademark becomes interchangeable with the name of the product or service. This process is called “genericide”. Some famous examples of genericide are aspirin for pain reliever, cellophane for plastic wrap and thermos for a vacuum flask. Two people filed a proceeding with the Trademark Trial and Appeal Board (TTAB) to cancel the Google trademark due to it having become a generic word for searching on the Internet. The TTAB denied the cancellation and the plaintiffs appealed to the Ninth Circuit Court of Appeals. The Court affirmed the TTAB. The Court’s opinion stated that even though the public might use the term as a verb, the Google mark could still serve as a source identifier.

You’re a successful business owner and you’d like to plan ahead. Professionals are urging you to prepare a “succession plan” – but you look at it as a retirement plan. Getting out of the daily grind might be nice, but giving up your life’s work and your legacy business? Maybe not so nice. No matter how they sugar coat it, “succession planning” looks like you’re calling it quits.

Dan Aykroyd’s Crystal Head Vodka gets to keep its dress. %CUT% Crystal Head Vodka’s maker, Globefull, Inc. brought a trade dress suit against Elements Spirits Inc. for copying its distinctive Day of the Dead inspired packaging on Element’s Kah Tequila. And then the 7 year odyssey began. Globefull lost the first jury trial. It appealed the denial of its motion for a new trial. The Ninth Circuit agreed that the trial was unfair because defense counsel had referenced similar litigation in Mexico in closing argument. Back in district court, Globefull lost its motion for preliminary injunction. But Globefull persevered. During the second trial, the owner of the elements was caught in a lie. At the previous trial, she testified she never heard of Crystal Head Vodka when she was developing Kah Tequila. In the second trial, the testimony of other witnesses contradicted that statement. The jury found in favor of Globefull on liability. The amount of damages will be set at a later date.

A repaired Rolex may not be a Rolex. %CUT% In Trademark Law, the “First Sale Doctrine” allows a consumer who buys a trademarked item to resell it without having to pay a license fee. But there are limits. In Rolex Watch USA, Inc. v. Krishan Agarwal, the defendant refurbished Rolex watches and then resold under the trademarked name. When Rolex sued him for trademark infringement, Agarwal asserted the affirmative defense of the First Sale Doctrine. The court rejected the argument. The court examined the impact of the modifications on the original product. If the modifications create a new product, it can no longer be sold using the trademark. In this case, Agarwal replaced dials and bracelets that weren’t authentic Rolex items. Agarwal offered to include a disclaimer. But the court held that the disclaimer would be confusing because the refurbished watch was really a new product.

Abstracts are nice in visual arts but not in patents. %CUT% Before Alice Corp. v. CLS Bank International, about 30% of software patent applications were invalidated. After Alice, the statistic is up to about 80%. Another one just went down. In Clarilogic, Inc. FormFree Holdings Corp., the Federal Circuit Court of Appeals affirmed summary judgment for the plaintiff to invalidate the defendant’s patent for credit reporting software. The Court ruled that the software "is directed to the abstract idea of gathering financial information of potential borrowers." The patent used computers to automate a fundamental financial information process without identifying any particular algorithm engine.

A new law prohibits blocking negative reviews. %CUT% On March 14, 2017, the Consumer Review Fairness Act of 2016 went into effect. The Act prohibits a company from using a ‘form contract’ to prohibit or restrict a person from posting a review, performance assessment, or other similar analysis of a company’s goods, services, or conduct. The Act also prohibits a company from requiring an individual to transfer intellectual property rights in the review or feedback to the company. Any form contract containing the prohibited language is void and can subject the company to a penalty or fee imposed by the Federal Trade Commission. The Act also creates a private right of action that can be brought by a State’s attorney general on behalf of the residents of the State.

The common law trademark rights of an Antarctic marathon organizer got a chilly reception from the TTAB. %CUT% Beginning in 1995, Marathon Tours, Inc. (“MTI”) organized sporadic cold weather marathons using the name “Antarctic Marathon”. Richard Donovan started his Antarctic marathon tours in 2006. Unlike MTI, Donovan’s tours were an annual event and have been well publicized and attended. When Donovan sought to register “Antarctic Ice Marathon and 100 k” and it’s graphic design, MTI opposed registration before the Trademark Trial and Appeal Board (“TTAB”) claiming prior common law rights. Everyone agreed that “Antarctic” and “Marathon” were descriptive words. So, for MTI to prevail, it would have to show that its use of “Antarctic Marathon” had acquired distinctiveness through continued use. All MTI could show was its sales and advertising, without context for the numbers, and four unsolicited articles from the media right before some events. The TTAB concluded that MTI failed to meet the burden of showing acquired distinctiveness and dismissed the opposition.

If your organization sponsors a 401(k) or other retirement plan, you or someone in your organization is a fiduciary to that plan. You may have hired a service provider to administer the plan (a third party administrator, or “TPA”), but the buck stops with your organization. This is because the fine print in your TPA’s service agreement says the official “Plan Administrator” is the employer, not the TPA. This means the employer has the ultimate responsibility for the plan’s ERISA compliance.

In case you’re curious about what happened after, here’s an update from a previous post. %CUT%

No group of artists suffers copyright infringement more than photographers. %CUT% Professional and amateur photographers post their photos on the Internet to proudly display their work. Photographers have a hard time reigning in unauthorized uses of their photos. It’s hard to track unauthorized downloads, hard to find the downloaders and the damages are usually not pursuing given the costs of litigation. That’s why VHT, Inc.’s $8.3 million judgment against Zillow Group, Inc. deserves acknowledgement. VHT licenses its photos of properties that are for sale to real estate agents. The real estate agents have a license to post the photos for marketing purposes. Zillow’s infringement resulted from use of the photos outside the scope of the license in two ways. First, it left the photos on its website even after the properties were sold. Second, Zillow posted the photos on its “Diggs” website which provides home design and improvement services.

When a virtual reality tech developer leaves, the real world intercedes. %CUT% Zenimax, owned by programming guru John Carmack, worked with Palmer Luckey to improve his Oculus Rift virtual reality gaming device. Zenimax allowed Luckey access to its proprietary technology. Luckey signed a Non-Disclosure Agreement (NDA). Facebook bought Luckey’s company. Right after the sale, a group of Zenimax employees left to work with Luckey. Zenimax sued Luckey and his company seeking $4 billion for trade secret misappropriation, copyright infringement and trademark infringement. And, oh yes, breach of the NDA. After trial, the jury rejected all but the breach of the NDA claim and awarded $500 million to Zenimax.