Tag: IP Law

Teaching Tips for IP Trial Lawyers

Imagine this scenario: Your star witness, an expert on the topic of prosthetic device microprocessors, has been on the stand for an hour discussing the history of prostheses, the nature of integrated circuits, and the two-part test for determining actual controversy. Thus far, he has relayed his testimony calmly and thoroughly. You are so pleased with his performance, your confidence concerning the trial outcome is beginning to swell. When you look over at the jurors, however, your optimism is dashed. One juror is rubbing her temples. Another has departed into a daze. And several others are grimacing. “Why aren’t they paying attention?” you wonder.

In response to being slapped with too much complex information, your jurors are showing signs of anxiety. When information overwhelms them, jurors exhibit a panoply of physical and mental responses. They might, for instance, shrink back in their seats, slump their shoulders, roll their eyes, and sigh loudly. They may feel insecure, frustrated, and even angry. Were it not unseemly courtroom behavior, jurors (and even judges) would audibly groan, “ugh.”

If you are a trial lawyer who specializes in intellectual property cases, you have probably observed these sorts of responses. Jurors often do not understand the technology that is at issue in the case. Many of them possess little inkling about the workings of trademarks, patents, or copyrights. They understand they have a duty to reach conclusions based on evidence, but that obligation becomes impossible to fulfill when they find the evidence incomprehensible.

If you spot jurors exhibiting these signs of anxiety during trial, your IP case is in danger. Their responses indicate they have stopped listening to your argument, and thus, you have lost out on an opportunity to gain support for your client. Even if you eventually rouse these jurors back to attentiveness, the likelihood that they will side with your client has been diminished.

That is the bad news. The good news is, you can present complex material to jurors without triggering their malaise. It is not the material that is the problem, it is the teaching methods you and your witnesses are employing. This article reviews effective teaching techniques you can use in the courtroom. Employing them will make your jurors sit up, lean forward, listen, understand your case, and perhaps even enjoy jury duty.

GETTING JURORS TO “I GET IT”

Good teachers understand how people learn. In order to teach jurors, you must understand that process too. Once these connections are made, people progress to the second stage of learning in which they incrementally add layers of new information to knowledge they already solidly possess.

Here is another way to look at the learning process. It can be likened to plants growing on a garden lattice. The lattice is the solid base that enables plants to grow, just as familiar concepts act as a base that allows new ideas to bud for jurors. Slowly, plants sprout on the lattice, just as new knowledge begins to blossom for jurors. Eventually a garden grows, and for jurors, this garden is your argument. By allowing new information to slowly take root in their psyches, you enable them to eventually see your argument in its entirety. Jurors are then able to use this new information to properly perform their duty to carefully weigh the evidence in the case.

A TEACHER’S TOOLKIT

The most effective classroom teachers use stories, analogies, and visual images to relay information to students. IP trial attorneys should employ these tools as well, and the specifics must be planned out and tested long before a witness takes the stand. Before getting into the nitty gritty of the technology at issue in the case, jurors should be provided the overarching story of the case—who did what to whom, when, and why—and most importantly, jurors should always be provided with the reason why they should care. When the case involves particularly complex topics, analogies that relate to concepts with which jurors are already familiar should, at the outset of the learning process, be used in place of complex case facts. As well, use pictures to help jurors visualize invisible concepts. Interactive tutorials can be particularly helpful since they enable jurors to study images and information at their own pace. When the timing of events at issue in the case are important, timelines should be displayed.

Just as the precise stories, analogies, and visual images teachers use depend on the subject matter they are presenting, the specific tools you will use will depend on the issues in your case.

The best stories, analogies, and visual images will have five characteristics in common.

The Five Key Tools Will:

  1. Use real-world language
  2. Employ familiar concepts and ideas
  3. Leverage memorable imagery
  4. Intrigue the listener
  5. Facilitate incremental or paced learning

HOW STORIES, ANALOGIES, AND PICTURES ENABLE COMPREHENSION TO TAKE FLIGHT

Let us say that you are defending an entrepreneur in a patent infringement case. In order to comprehend the evidence in the case, the jurors need to understand the concept of the enablement requirement for patent applications. Your expert witness might explain that the patent system has three primary disclosure requirements. These requirements consist of enablement, written description, and best mode. The enablement requirement compels the patent applicant to disclose the invention in a manner that allows a person of ordinary skill in the art to make and use the invention without an undue amount of experimentation. She might add that enablement is the only disclosure requirement internationally mandated by the agreement on Trade-Related Aspects of Intellectual Property, or TRIPS.

While there would be nothing inherently faulty about her explanation after hearing it, the jurors would be holding back their “ughs.” They would find the narration boring and barely comprehensible, and they would dread the prospect of spending the next few days sitting through similar testimony.

Now imagine how much more effective the expert would be if she started off discussing humans’ age-old desire to fly. “Every person has longed to fly at some point,” she might say. “Children try to fly off couches, adults dream of flying at night, and the Greek myth of Icarus centers on what happens when the joy of flying overtakes common sense.”

This story is appealing because it uses familiar concepts (Tool 2) and memorable imagery (Tool 3) to hook the audience.

The witness might go on, “People tried for centuries to build contraptions that would enable the dense-boned, unfeathered human mammal to fly. Many people died trying. Even the genius Leonardo da Vinci tried to come up with a flying machine. He eventually ended up declaring, ‘I have wasted my time.’”

By mentioning this famous artist, the expert will have again introduced subject matter with which jurors are familiar (Tool 2). And the fact that he tried yet failed at something will create intrigue (Tool 4) in jurors’ minds.

“None of these inventors could have received a patent under U.S. law,” your expert could explain, “because none of them successfully ‘enabled’ their ideas.” She might add, “In other words, their ideas didn’t work.”

Now she would be using everyday language (Tool 1) to communicate with real-world people.

“But man’s quest for flight finally was achieved, on December 17, 1903,” she could continue, “when brothers Orville and Wilbur Wright built and, yes, successfully flew the first airplane. Unlike everyone before them, these two Ohio bicycle makers successfully ‘enabled’ the idea of a flying machine by making a machine that actually flew. As a result, the US Patent Office granted the Wright brothers a patent to protect their years of hard work from any imitators. ”

(call out) When graphic displays are used, an already-interesting story could become riveting.

Suppose that during the expert’s testimony, jurors are shown how flying inventions evolved throughout the years. The progression and timing of inventions might be portrayed by building, bit by bit, new layers upon old inventions. As the witness talks about early attempts to fly, you might show Leonardo da Vinci’s sketches from the 1400s. You could then show pictures of aircrafts created by later inventors, such as the designs Sir George Cayley created in the early 1800s and the flying machines Claude Givaudan and Louis Bleriot made in the early 1900s.

By creating a graphic that layers crucial information, you will have facilitated paced learning (Tool 5).

The expert’s story might end with a display of the Wright brothers’ patent application and a historical photo of their machine actually taking flight. And just like that, your jurors’ understanding of the concept of enablement will have taken flight as well. They will realize that it was not enough for previous inventors to possess good ideas. Only once the Wright brothers created a machine that could actually fly was their invention enabled. The invention was worthy of a patent because now someone with requisite skill could actually copy and use this invention.

READY FOR TAKE-OFF

Without ever hearing one complex case fact, jurors can come to understand the issues at the crux of your case. Stories, analogies, and visual displays, will keep them interested in your presentations and enable them to painlessly accumulate a sound base of knowledge. With that base in place, they will then be ready to hear about the specific technology and other evidence related to your case. Chances are high, if you are willing to use effective teaching tools, jurors will not only understand your arguments, they will support them.

© Copyright 2002-2021 IMS ExpertServices, All Rights Reserved.
ARTICLE BY Chris Ritter of IMS ExpertServices
For more articles on IP trials, visit the NLR Intellectual Property section.

Survey Evidence Not Enough to Show Acquired Distinctiveness of Starbuck’s Green Dot on Coffee Cup

In our overstimulated environment with a plethora of brands, names, and marks, it is difficult for products to stand out. Some businesses, however, have managed to break through the noise by creating marks with lasting impressions on consumers. But there are limits, even for the most well-known brands such as Starbucks.

Starbucks Cup Comparison

While Starbucks was able to register its recognizable green circle on a white cup of particular size and shape for coffee, tea, and restaurant services (pictured on right), it was not as fortunate with its attempt to register a green circle on a white cup with no identifiable size or shape mark (pictured on left). See In re Starbucks Corporation, Serial Nos. 85792872 (left) and 86689423 (right) (January 17, 2019) (Opinion by Judge Michael B. Adlin).

In rejecting the plain green circle dot mark (left), the Trademark Trial and Appeal Board (TTAB) found the green circle, by itself, did not create a “separate and distinct commercial impression” from the famous siren design. As such, Starbuck’s consumer survey evidence fell short of establishing acquired distinctiveness, raised adequacy concerns, and failed to show that consumers associate the green circle on a cup with Starbucks.

A mark acquires distinctiveness when it is capable of making the relevant public audience associate the mark with its source. The mark gains secondary meaning when the consuming public naturally thinks of the producer and not the product. Usually, consumer surveys are used to measure whether a word, name, symbol, or design is identified by consumers as originating from a single source and to establish secondary meaning, especially with trade dress marks.

Starbucks Logo

In 2012, the evergreen coffee chain, Starbucks, filed two applications with the United States Patent and Trademark Office (USPTO) for the trade dress designs on its coffee cups featuring a green dot. The USPTO rejected both, and Starbucks appealed to the TTAB. In evaluating Starbuck’s consumer surveys upon which Starbucks relied to show acquired distinctiveness of the green circle on a white cup, the TTAB concluded that while the surveys had “some probative value,” their reliability was suspect. According to the TTAB, one of the most important aspects of a secondary meaning survey is to choose an appropriate control stimulus that shares as many characteristics with the experimental stimulus as possible except the characteristic whose influence is being assessed. In its survey, Starbucks tested two white cups with a green dot on the front and used a plain pale blue cup with no other markings as the control. The test cup had no distinguishing features displayed, which most likely led to the respondents’ low rate of identification of a single company. Instead, the control would have more adequately satisfied the standards of a control stimulus if the plain blue cup featured a different shape in a different color, such as a blue triangle.

The control stimulus is important because it not only filters out respondent guessing, but also identifies responses unrelated to the specific mark being tested. The absence of a proper control stimulus was evident in the survey responses identifying Starbucks – the TTAB noted it was not clear why survey respondents identified Starbucks, whether because of the green dot or because “green = Starbucks”, the shape of the cup, how familiar it looked, and the overall popularity of Starbucks. While the rates of association and recognition of the brand name were high, i.e. 65% and 69%, much higher than the minimum 30% required, the Board found this was due to the test cup’s unfamiliar and different characteristics, which led to an increase in responses identifying the cup with a green dot as Starbucks simply because Starbucks is a popular coffee brand. Had Starbucks used a control sample that was substantially similar to the specimen but for a blue triangle instead of a green circle, the TTAB would have viewed the survey results more favorably.

cups

The TTAB also took issue with the sample population of respondents surveyed. Starbucks’ survey was conducted online using an Internet panel, which excluded consumers who do not regularly use the Internet or use the Internet by phone. The TTAB found Starbuck’s sample population underrepresented low-income, rural, and elderly consumers who do not use the Internet much, but who are still very much a reasonable part of the coffee purchasing public. A more well-rounded and inclusive sample population would have resulted in a more accurate depiction of association and recognition rates.

Secondary meaning surveys have evolved from having no control stimuli to more carefully crafted experiments based on the use of a control stimulus. The Starbucks decision is instructive for applicants relying on consumer surveys – make sure to use control stimuli that replicate the test stimuli except for the mark characteristic or attribute being tested, do not go the way of the green dot.

COPYRIGHT © 2020, STARK & STARK

ARTICLE BY Gene Markin of Stark & Stark
For more, visit the NLR Intellectual Property section.

Dr. Seuss/Star Trek Mashup Boldly Goes to Ninth Circuit but Loses Fair Use’s Balancing Act

An author of Star Trek episodes teamed up with fellow Trekkies at ComicMix LLC to publish Oh, the Place You’ll Boldly Go!, an illustrated book that combined Star Trek characters with the stories of Dr. Seuss. Boldly used elements and illustrations from Seuss’s books Oh, the Places You’ll Go!, How the Grinch Stole Christmas! and The Sneetches and Other Stories. Dr. Seuss Enterprises, L.P., owner of the intellectual property in Dr. Seuss’s works, objected to the mashup book and sued ComicMix LLC for copyright and trademark infringement and unfair competition. The district court agreed with ComicMix that Boldly constituted a fair use of Seuss’s copyrights and granted summary judgment in ComicMix’s favor on the copyright claims. On appeal, however, the Ninth Circuit concluded that all of the statutory factors of the fair use defense weighed against ComicMix and reversed the district court’s copyright ruling, but affirmed the lower court’s trademark analysis

As explained by Dr. Seuss in Oh, the Places You’ll Go!, life is a great balancing act. Similarly, the test for fair use of a copyrighted work balances four statutory factors: (1) the purpose and character of the use, including whether the use is commercial or is for nonprofit educational purposes; (2) the nature of the copyrighted work; (3) the amount and substantiality of the portion used in relation to the copyrighted work; and (4) the effect of the use on the potential market for or value of the copyrighted work. Applying these factors, the Ninth Circuit sent ComicMix packing.

First, the court analyzed the purpose and character of Boldly’s use of Seuss’s works, including whether Boldly was a transformative work. Although ComicMix asserted that Boldly was a parody of Go!, Boldly did not ridicule or critique Go!. Instead, Boldly focused on Star Trek characters and their adventures while evoking Go! by copying and repackaging Dr. Seuss’s “characteristic style” and illustrations. Consequently, Boldly was neither a parody nor transformative. Further, Boldly copied Go!’s illustrations, meaning, and message, and did so for a commercial purpose. The Ninth Circuit thus concluded that the first factor weighed definitively against fair use.

Illustration from Go! (left) and a “repackaged” illustration from Boldly (right)

Second, the creative and expressive nature of Seuss’s Go! weighed against a finding of fair use. The court noted that although the nature of the copyrighted work is usually not very significant in the fair use analysis, creative works like Go! are “closer to the core of intended copyright protection” than other types of works, such as informational works.

The third factor, the amount and substantiality of Boldly’s use of Go!, “weighed decisively” against fair use. Boldly used a substantial quantity of Go!—it copied nearly 60% of Go!, along with significant illustrations from two of Seuss’s other books, How the Grinch Stole Christmas! and The Sneetches and Other Stories. In fact, the court found that ComicMix deliberately and meticulously copied Seuss’s illustrations:

Excerpts from Go! (left) and Boldly (right)

In addition to a quantitative element, the third factor also has a qualitative component, which is often described as analyzing whether the copyist took the “heart,” or “the most valuable and pertinent portion” of the work. The Ninth Circuit held that Boldly had taken the heart of Seuss’s works. As an example, the court noted that ComicMix took the “highly expressive core” of Seuss’s Sneetches book by including illustrations of a machine from Sneetches on ten of Boldly’s twenty-two pages. In Seuss’s Sneetches, the machine is an integral part of the story because it can add and remove divisive heart-shaped symbols to and from the stomachs of Sneetches. Boldly copied minute details from the Sneetches machine; in fact, the illustrator stated that he “painstakingly attempted” to make the machines “identical.”

The machine from Sneetches (left) and Boldly (right)

The court concluded that ComicMix lacked justification for the substantial quantity and quality of its copying, especially considering that Boldly did not parody or transform Seuss’s works, and instead was a commercial exploitation.

For the fourth factor, the Ninth Circuit considered the potential market for, and value of, Seuss’s works. Seuss’s books have remained very popular and, for decades, Seuss authorized numerous derivative works. ComicMix planned to capitalize on Go!’s popularity during graduation season by scheduling Boldly’s publication “in time for school graduations.” Noting Seuss’s frequent collaborations and authorized licensing throughout the year, the court held that Boldly was likely to target and harm Seuss’s market for derivative works.

Because Boldly was an unauthorized and non-transformative work, ComicMix did not prevail on its fair use defense. Accordingly, the Ninth Circuit reversed the district court’s grant of summary judgment on Seuss’s copyright infringement claim.

Finally, the court affirmed the district court’s grant of summary judgment in favor of ComicMix on Seuss’s trademark infringement claim. The court held that dismissing the trademark infringement claim was proper because the use of Seuss’s registered and common-law trademarks (including in the title of Go!, the alleged “Seussian style of illustration,” and the claimed “Seussian font”) was not explicitly misleading. Under the Rogers test, the Lanham Act does not apply to the use of trademarks in an expressive work (like Boldly) unless the use is not artistically relevant, or if the use is explicitly misleading. Boldly satisfied the low threshold for artistic relevance, and the use was not explicitly misleading because Boldly listed the authors’ names on the cover and contained new expressive content.

The case is Dr. Seuss Enters., L.P. v. ComicMix LLC, 983 F.3d 443 (9th Cir. 2020).

© 2021 Finnegan, Henderson, Farabow, Garrett & Dunner, LLP

ARTICLE BY Jessica L. Hannah of Finnegan
For more, visit the NLR Intellectual Property section.

Can’t Hold Macklemore and Ryan Lewis Liable for Copyright Infringement Says Fifth Circuit

In 2017, a New Orleans Jazz Musician, Paul Batiste’s (“Batiste”), sued the world-renowned duo Macklemore and Ryan Lewis (“Macklemore”) alleging the duo copied eleven of his songs. Batiste v. Lewis, 2019 U.S. Dist. LEXIS 69130, 2019 WL 1790454 (E.D. La., Apr. 23, 2019). Batiste claimed Macklemore had, without permission, digitally sampled Batiste’s songs, and as a result, Macklemore’s hits, “Can’t Hold Us,” “Thrift Shop,” “Neon Cathedral,” “Same Love,” and “Need to Know” were based on or derivatives of Batiste’s copyrighted musical works. The district court disagreed after finding Batiste failed to sufficiently prove Macklemore had “access” to Batiste’s music and that Macklemore’s songs were strikingly similar to Batiste’s. Additionally, the district court held Batiste liable to pay Macklemore’s attorney fees pursuant to 17 U.S.C. § 505.

Batiste appealed and on September 22, 2020, the Fifth Circuit affirmed the lower court’s decision. See Batiste v. Lewis, Nos. 19-30400, 19-30889, 2020 U.S. App. LEXIS 30346 (5th Cir. Sep. 22, 2020). The Fifth Circuit agreed Batiste did not sufficiently prove Macklemore had access to Batiste’s works and failed to show substantial similarity between the competing works. Furthermore, the Fifth Circuit upheld the attorneys’ fees award, to the tune of $125,000, in favor of Macklemore.

Batiste argued Macklemore must have had access as a result of Batiste’s songs being “widely disseminated” through radio stations, record stores, and live performances at local nightclubs. Citing to evidence of “meager sales in only a handful of local stores” and “sparse” streaming and downloads, the court disagreed with Batiste and found the dissemination of his music was “quite limited.” The court further noted that Batiste’s songs did not become available to stream until after Macklemore had released most of their hit songs. Because Batiste failed to prove Macklemore had actual or constructive access, he was then tasked with proving “strikingly similarity” in order to prevail on his infringement claim since a “probative similarity can make up for a lesser showing of access.” In that regard, the Court found Batiste fell flat and did not “even try to meet the striking-similarity standard.”

Considering the objective unreasonableness of Batiste’s claims, his history of litigation misconduct, and his pattern of filing pugnacious copyright infringement actions, the court upheld the district court’s award of attorneys’ fees to Macklemore.

Accordingly, copyright infringement plaintiffs should think twice before filing suit capriciously and without first objectively evaluating the strength of their “access” and “similarity” proofs. The more access a defendant had to plaintiff’s copyrighted works the less similarity is required for a finding of infringement, and vice-versa, however, proof of both is ideal.

COPYRIGHT © 2020, STARK & STARK
ARTICLE BY Gene Markin of Stark & Stark
For more, visit the NLR Intellectual Property section.

Consumer Public Interest Lawsuit Seeks 21 Million RMB for Counterfeit Trademark Sales of Starbucks in China

On November 22, 2020, the Jiangsu Provincial Consumer Protection Committee announced they filed a public interest lawsuit on October 26, 2020 against Shuangshan Food (Xiamen) Co., Ltd. for selling counterfeited Starbucks coffee.  Shuangshan was previously subject to criminal prosecution for the sale of the counterfeit coffee amounting to 7 million RMB (~$1 million USD). This is the first consumer civil punitive damages public interest litigation in Jiangsu Province and the demand for compensation of 21 million RMB is the highest demand ever made in China in a consumer civil public interest litigation.

In February 2018, the Wuxi City Market Supervision Department received a report stating that there were counterfeit “Starbucks” brand coffee being sold. An investigation determined the “Starbucks” coffee sold by Shuangshan was a counterfeit product. After verification, the market supervision department notified the Wuxi public security department. Later, it was found that the coffee sold by Shuangshan Company was not authorized by the owner of the “Starbucks” brand. Under the premise of knowing that the purchased products were counterfeit, Shuangshan still forged customs declaration documents and false authorization documents, and sold the products. The counterfeit Starbucks coffee went to more than 50 merchants in 18 provinces across China, and finally sold to end consumers.  In 2019, the Xinwu District Procuratorate prosecuted Shuangshan Company and related personnel with a verdict reached  in December. At the same time, the Xinwu District Procuratorate recommended that the Jiangsu Provincial Consumer Protection Committee file a consumer civil public interest lawsuit.

The Jiangsu Provincial Consumer Protection Committee concluded that the case was an intellectual property case involving counterfeit trademarks. The facts were clear and fixed, the amount involved was huge, and the infringement was serious.  The fake coffee sales constituted fraud and the Committee therefore claimed punitive compensation of three times the amount involved. On October 26, 2020, the Wuxi Intermediate People’s Court formally accepted the case.

How to distribute any funds collected by the Committee as a result of the lawsuit has yet to be determined.

 

Starbucks Thanks You Letter

ARTICLE BY Aaron Wininger of Schwegman, Lundberg & Woessner, P.A.
For more articles on IP law, visit the National Law Review Intellectual Property section.

Louis Vuitton Playing Chess or Checkers? The CJEU Annuls’ The Invalidation of Louis Vuitton EU Trademark

Louis Vuitton received a favorable decision from the EU General Court (“General Court”) in June 2020 which may assist brand owners seeking IP protection of their decorative patterns. The decision confirms the distinctive character an EU trade mark must possess in order to benefit from protection throughout the EU as well as highlighting how patterns may be protected through registration as a trade mark rather than under other forms of IP protection such as copyright or design protection. However, the decision also reaffirmed the EU’s strict approach to assessing the unitary character of EU trade marks, which potentially sets a high bar for applicants to clear.

Background

In 2008, Louis Vuitton had obtained EU trade mark protection for the mark displayed below, the Damier Azur mark, in relation to class 18 goods including luggage, bags and leather goods. In 2015 a Polish individual, Norbert Wisniewski, challenged the validity of the mark by filing an application for invalidity with the EUIPO.

 

 

The ‘Damier Azur’ mark

In 2016 the Cancellation Division of the EUIPO declared Louis Vuitton’s trade mark invalid under Article 59(1)(a) of the EU Trade Mark Regulation (“EUTMR”) on the grounds that the mark was devoid of any distinctive character in line with Article 7(b) of the EUTMR. The Cancellation Division did not agree with Louis Vuitton’s claim that the mark had acquired distinctiveness through its use. Louis Vuitton then took its claim to the EUIPO Second Board of Appeal who also dismissed their claim and agreed with the Cancellation Division.

General Court

In 2019 the matter was appealed to the General Court of the CJEU and Louis Vuitton put forward two main arguments that:

  1. the Second Board of Appeal had incorrectly assessed the inherent distinctive character of the Damier Azur mark as the Board had relied on ‘well-known facts’ to supplement the arguments presented by Mr Wisniewksi in the absence of any concrete and substantial evidence for a declaration of invalidity; and
  2. the Board of Appeal had failed to carry out an overall assessment of the Damier Azur mark and had therefore erred in its assessment of the distinctive character acquired through use of the mark.

With regard to point one, the General Court considered that the Board of Appeal had relied upon a number of well-known facts in its decision including how the chequerboard pattern of the mark was a commonplace figurative pattern, which is permissible. The General Court determined that the Board had been correct in its finding that the mark was a basic and a commonplace pattern that did not depart significantly from the norms of the sector and that this was a well-known fact within the meaning of case law. The first argument was therefore rejected.

As to argument two, the General Court inferred that the Board of Appeal had focused on evidence which expressly referred to a specific set of Member States and had excluded other evidence without conducting any further analysis on said evidence. The General Court determined that the excluded evidence did contribute to the arguments put forward by Louis Vuitton concerning the acquired distinctiveness of the mark including the widespread use of the mark across the whole of the EU and the market shares held by the mark in each Member State. The General Court thus found that the Board of Appeal had failed to sufficiently take into account the distinctive character of the mark in relation to the goods and services for which it is registered.

Takeaway points

The decision by the General Court reaffirms the wide scope of evidence and rigorous determination that must be followed by the courts and IP administrative bodies. The General Court also emphasized the need for a mark to be distinctive throughout the whole of the EU rather than just across a defined set of Member States, which is often a high threshold for applicants to meet (as seen in the Kit Kat case, among others). Although the General Court did annul the decision of the Second Board of Appeal on the basis of an error in the full assessment of the evidence, it is still not yet fully clear whether Louis Vuitton’s excluded evidence would be sufficient to prove the required distinctiveness of the mark as the General Court made no comment on this point. This is an intriguing space to follow and we will keep you updated as the case progresses.

Copyright 2020 K & L Gates
For more articles on IP law, visit the National Law Review Intellectual Property section.

Copyright Office Implements Mass Registration For Short Online Literary Works

Highlights

  • The new Group Registration for Short Online Literary Works (GRTX) permits up to 50 short online literary works to be registered simultaneously
  • GRTX permits a single registration certificate, at a much lower cost than previously
  • GRTX applies to online content only, such as articles, blogs and social media posts

The United States Copyright Office recently implemented a new group registration process for registering multiple, short online literary works under a single copyright registration.

This process – referred to as Group Registration for Short Online Literary Works (GRTX) – is designed for those who regularly publish content online, such as articles, blogs and social media posts; but not the likes of emails, podcasts or audiobooks.

The new GRTX can include between two and 50 works within a single $65 copyright application. The process offers a significant cost savings, as previously 50 works would cost more than $3,000 in application fees.

The GRTX requirements include the following:

  1. the works need to be first published online (or simultaneously with a physical form publication)
  2. the works must have been published during the same three-month period
  3. the works must be between 50 and 17,500 words
  4. the works may not be works made for hire
  5. the GRTX registration only applies to the text of the short literary work

If registration is granted, the holder will receive a single registration certificate and registration number for the entire group of works.

Law clerk Nick Rivera contributed to this alert.

© 2020 BARNES & THORNBURG LLP

 

ARTICLE BY Jonathan P. Froemel of Barnes & Thornburg LLP
For more articles on copyright law, visit the National Law Review Intellectual Property section.

“Can’t Hold Us” Liable: Macklemore & Ryan Lewis Win Affirmance in Copyright Suit

The US Court of Appeals for the Fifth Circuit affirmed a grant of summary judgment on the issue of copyright infringement and an award of attorneys’ fees against the plaintiff under the Copyright Act. Although the Court noted that it lacked jurisdiction to review sanctions against the plaintiff’s attorney, it observed that counsel went beyond “vigorous representation.” Batiste v. Lewis, Case Nos. 19-30400, -30889 (5th Cir. Sept. 22, 2020) (Clement, J.).

Batiste, a local musician, sued Macklemore & Ryan Lewis, an internationally famous hip-hop duo, for copyright infringement. Batiste alleged that the duo sampled his songs without authorization. As support, Batiste submitted the expert report of a musicologist, Milton, but Milton later admitted that Batiste had conducted the analysis and written the report, and that Milton did not even have access to the necessary software. The district court excluded the report, which Batiste then sought leave to resubmit in his own name. The district court denied leave because Batiste had not disclosed himself as an expert and because the new report was untimely. The district court subsequently granted the defendants’ motion for summary judgment, finding that Batiste had failed to submit sufficient evidence of Macklemore and Lewis’s alleged access to Batiste’s work or of probative similarity between Macklemore and Lewis’s works and Batiste’s. The district court then awarded fees to Macklemore and Lewis under the Copyright Act (17 USC § 505) and made Batiste’s attorney (Hayes) jointly and severally liable for the fees award as a sanction under 28 USC § 1987. Batiste appealed.

Addressing the district court’s summary judgment of no infringement, the Fifth Circuit considered Batiste’s proofs as to access and similarity.

Batiste tried to prove access through “widespread dissemination” and “chain of events” theories. The Court held that Batiste’s evidence of widespread dissemination was insufficient because it only established “quite limited” dissemination of Batiste’s music. Batiste’s chain of events theory—under which Macklemore and Lewis allegedly accessed Batiste’s work by playing a concert at a venue near a record store that sold Batiste’s music—raised only a “bare possibility” of access and was therefore also insufficient.

On the issue of similarity, the Court explained that because of Batiste’s failure to show access, he needed to show “striking similarity” to withstand summary judgment. The Court rejected Batiste’s argument that “overwhelming evidence of access” obviated any need for him to show similarity. The Court compared the allegedly infringing songs to Batiste’s and found them insufficiently similar for a jury to find striking similarity. The Court also rejected Batiste’s invitation to adopt the US Court of Appeals for the Sixth Circuit’s ruling in Bridgeport, which held a showing of similarity unnecessary in some circumstances. The Fifth Circuit noted that Bridgeport has been widely criticized, and pointed out that Bridgeport considered the issue of substantial similarity (which dictates whether factual copying, once established, is legally actionable), whereas the issue in this case was probative similarity (which raises an inference of factual copying).

Batiste challenged the award of attorneys’ fees as erroneous absent a finding of frivolousness or bad faith. The Court rejected Batiste’s argument as inconsistent with the Supreme Court of the United States’ 2016 decision in Kirtsaeng (citing and quoting its 1994 decision in Fogerty), which list frivolousness or bad faith among other non-controlling factors that district courts may consider in exercising discretion to award fees.

Finally, the Court noted that that it lacked jurisdiction to consider the sanction against Batiste’s attorney Hayes, because Hayes was not listed as a party on the notice of appeal. The Court nonetheless excoriated Hayes for his role in the submission of the Milton report and “remind[ed] Hayes of his ethical and professional obligations as a lawyer and advise[d] him to take those obligations seriously,” stating, “We certainly do.”

© 2020 McDermott Will & Emery
For more articles on copyright infringement, visit the National Law Review Intellectual Property section.

The Wild (Kanye) West of Trade Secret Theft

Musical artist and fashion icon Kanye West is being sued by a video and ecommerce company called MyChannel Inc. (MYC) that claims he breached their mutual nondisclosure agreement and took “their proprietary and confidential technology and information to fuel the e-commerce engine” of his Yeezy brand. MYC filed its lawsuit in the US District Court for the Central District of California. The minority-owned business alleges that West made “lavish promises to MYC of millions of dollars in economic reward,” as well as the formation of a lucrative partnership providing millions more[.]” In return, MYC asserted that it agreed to provide Kanye West—and did in fact provide Kanye West—with “tens of thousands of hours of investment in Yeezy in reliance on those promises and the MYC-Kanye partnership.”

At the heart of MYC’s complaint is its allegation that it developed a unique video platform—including a unique, proprietary “shopability” function that was protected by a nondisclosure agreement—to grow the ecommerce operation of West’s Yeezy brand. According to MYC, West brazenly rebranded MYC as his own company, referring to it as “YZY Tech” to partners like Adidas. MYC claims that West and his Yeezy brand then breached their obligations to compensate MYC for its work, yet they nevertheless continued to use MYC’s ecommerce platform, including MYC’s shopability function. In fact, MYC alleges that West’s “closest confidents [sic] and business advisors reached out to MYC’s founders” noting similarities between their work and the platform West continued to use, reasonably believing that MYC was responsible for the content.

The veracity of MYC’s claims will be tested in court as it litigates its claims against Kanye West. In the meantime, this case demonstrates that theft of intellectual property does not always occur in the shadows with, for instance, employees clandestinely misappropriating trade secrets. Rather, misappropriation of intellectual property can sometimes occur in plain sight when business deals and/or partnerships deteriorate. It is important, then, to clearly delineate rights to intellectual property and carefully craft nondisclosure agreements that protect assets exchanged with prospective partners.

© 2020 Jones Walker LLP
For more articles on trade secrets, visit the National Law Review Intellectual Property section.

COVID-19: FTC Acts Fast, Lambasts Missing Masks

Section 5 of the Federal Trade Commission Act (15 U.S.C. Section 45(a)) provides worthwhile remedies for the types of unfair competition that intellectual property practitioners find quite familiar, and practitioners should give them due consideration.  Selling COVID-19 masks you don’t have provides a good example.

In a case filed in early July (FTC press release) the FTC took a Staten Island business to task, along with its owner, for claiming that masks, respirators and other “PPE’s” (personal protection equipment) was “in stock” and “would ship the next day” (Complaint).  The website “supergooddeals.com” continues to lead off with its signature slogan, “Pay Today, Ships Tomorrow” (https://supergooddeals.com/; also accessed by the author on July 31, 2020).

Apparently starting in March 2021, supergooddeals.com began selling PPE.  According to the FTC complaint, the website claimed that the desired masks were “IN STOCK” (complaint paragraphs 19 and 20).  The FTC complaint gives no indication as to whether or not the “in stock” claim was accurate, but instead pleads the examples of several consumers who never received masks, and numerous complaints to which supergooddeals.com never responded.

The FTC complaint also implies that to the extent that some orders may have been shipped, they were shipped on terms that were far less favorable than supergooddeals.com advertised, and when shipments never arrived (or perhaps were never sent) supergooddeals.com failed to give buyers the opportunity to change their mind, or offer a refund or any modification in price terms (e.g. Complaint paragraphs 29-31).

Supergooddeals.com also apparently attempted to conceal their failures (worse verbs could be applied) by producing shipment labels carrying the promised shipping date, but for packages that either would never ship, or shipped much later than the labelled date.  Supergooddeals.com apparently didn’t realize that when a business creates its own USPS shipping labels, “An electronic record is generated on the ship date indicating that your package has been mailed and the Postal Service is expecting to see your package that day.” Click-N-Ship Field Information Kit

(For those of us that may merely be tardy, the same USPS webpage suggests mailing the package on the next business day.  Checking for a friend.)

The FTC also asserted MITOR (“Mail, Internet, or Telephone Order Merchandise,” 16 CFR Part 435) which defines the terms in the name, defines unfair and deceptive practices in context, requires certain activities, and lists some exceptions (including, for reasons known only on K Street, “orders of seeds and growing plants”).

So, the alleged infractions include:

  • Advertising a delivery date that you know you cannot meet,
  • Advertising items that you don’t have in stock
  • Producing a false mailing label in an attempt to prove the shipping date, and
  • Failing to cancel orders when requested or provide prompt refunds

The Federal Trade Commission Act has worthwhile remedies for such activities, and as the Complaint indicates (paragraphs 58 and 59) the FTC plans to seek them against supergooddeals.com.

So, the people get their money back from supergooddeals.com and all’s well that ends well. Right?

Not exactly.  The FTC Act offers no private right of action in these circumstances.  The Fair Debt Collection Practices Act (FDCPA) 15 USC Section 1692(d) which is generally under the Federal Trade Commission, provides private remedies in the consumer debt arena, but a private party otherwise has no right to the remedies sought against supergooddeals.com under the FTC Act.

At this point, however, the intellectual property (“IP”) practitioner may have an extra arrow up his or her sleeve:  Section 43(a) of the Lanham Act (15 USC 1125(a)) if—IF—the parties can be defined as competitors in the section 43(a) sense.

FTC § 5(a)

Lanham Act § 43(a)

Unfair methods of competition in or affecting commerce, and unfair or deceptive acts or practices in or affecting commerce, are hereby declared unlawful.

(1)Any person who, on or in connection with any goods or services, or any container for goods, uses in commerce any word, term, name, symbol, or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which—

Anchor(A)

is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person, or

Anchor(B)

in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person’s goods, services, or commercial activities,

shall be liable in a civil action by any person who believes that he or she is or is likely to be damaged by such act.

The Lanham Act applies to false representations (etc.) about goods and services in interstate commerce, but plaintiffs attempting to stretch section 43 (a) too far have been turned down e.g., Radiance Found., Inc. v. NAACP, 786 F.3d 316 (4th Cir., 2015) (The Radiance Foundation, an African American influenced pro-life organization, criticized the NAACP over the NAACP position on abortion.  The NAACP issued a cease and desist letter and the Radiance Foundation filed a declaratory judgment complaint arguing that neither trademark infringement nor dilution had occurred.  The NAACP counterclaimed under (inter alia) section 43(a).  The Fourth Circuit held that for a number of reasons, including the lack of competing goods or services in the section 43(a) sense, the NAACP did not have a trademark remedy in these circumstances.)

Supergooddeals.com certainly dealt (and continues to deal) in “goods” in the sense of section 43(a).  Nevertheless, the “hundreds of” consumers listed in (e.g.) paragraph 26 of the FTC complaint don’t have a section 43(a) remedy against supergooddeals.com because such customers are not “competitors” of supergooddeals.com in the sense required by section 43(a).  Stated more formally, for individual defrauded customers, the answer to, “whether a legislatively conferred cause of action encompasses a particular plaintiff’s claim” is “no.” (Lexmark Int’l, Inc. v. Static Control Components, Inc., 572 U.S. 118, 132 (2014). (“A consumer who is hoodwinked into purchasing a disappointing product may well have an injury-in-fact cognizable under Article III, but he cannot invoke the protection of the Lanham Act—a conclusion reached by every Circuit to consider the question.”)

Does Pat Peoples have any Silver Lining here?  Well, yes. In addition to a possible contractual remedy, most states have some form of general “unfair competition is illegal” statute as well as consumer protection remedies.

For the time being, however, these defrauded consumers have Uncle Sam on their side, and when “Uncle” sues he usually gets the job done.

 

Copyright 2020 Summa PLLC All Rights Reserved

ARTICLE BY Philip Summa and Summa PLLC.
For more FTC PPE Actions see the National Law Review Coronavirus News section.