Category: Intellectual Property

Jennifer Lopez Sued for Copyright Infringement

More and more often nowadays, celebrities are being sued for posting pictures of themselves on Instagram. While this does not make much sense to many of us, posting a picture on social media that you did not take without permission from the photographer can result in copyright infringement charges.

Actress and singer, Jennifer Lopez, is the latest celebrity to be hit with a copyright infringement suit. Lopez and her production company are being sued for over $150,000 in damages by photographer Steve Sands, who alleges that Lopez posted a photo taken by Sands on Instagram. Sands contends that Lopez and her production company did not license the photograph from Sands or have permission from Sands to post the photo.

While the average person may do something similar and get away with it, celebrities often will not, due to the significant number of likes the photo receives and the celebrity’s large number of social media followers. Some say celebrities post these images to brand themselves without permission from the taker of the photo.

This is not the first time Lopez has been sued for posting. Lopez was sued by Splash News and Picture Agency for $150,000 in October 2019, when she posted a photo taken by the company of her now fiancé, Alex Rodriguez, in her Instagram story in 2017. Splash News alleged they were the owner and exclusive copyright holder of the picture.

The Copyright Act protects the rights of Connecticut photographers by prohibiting others from using their photos for promotion without consent. However, there are exceptions that allow use of another’s photos in certain circumstances.

© 2020 by Raymond Law Group LLC.

Expunge-Examine-Ex Parte; the Trademark Office Seeks to add Arrows to its Quiver

According to a recent audit carried out by the Trademark Office and evaluating over 8000 registrations, as many as 46% of US use-based registrations were unsupported by actual use, with the percentages for Paris Convention and Madrid Protocol registrations reaching 66% and 65 respectively.

In other words, almost two-thirds of treaty-based applications arriving at the Trademark Office from outside the United States failed to meet a proof-of-use test.

For example, in late January 2018 The United States Patent and Trademark Office received a new application for federal trademark registration and assigned it an “87” series number.  The application was for a mark in standard characters, and was based on a Section 44(d) filing basis (15 USC § 1126(d)); i.e., an application accepted by the USPTO under treaty obligations with reciprocating countries.  (As a quirk of trademark law, practitioners tend to refer to sections of the original 1946 Lanham Act, even though their statutory citations are numbered quite differently.)

Under goods and services, the Applicant listed 115 different items (count ‘em) in International Class 03 (“bleaching preparations and other substances for laundry use; cleaning, polishing, scouring and abrasive preparations; soaps; perfumery, essential oils, cosmetics, hair lotions; dentifrices”).

Because the application was a treaty document, rather than a US use-based application, the Applicant provided neither a specimen nor any other evidence of use.  Following a brief prosecution, the registration issued in February 2019.

Trademark registration, of course, carries some important benefits including (but not limited to) “prima facie evidence of the validity of the registered mark and of the registration of the mark, of the owner’s ownership of the mark, and of the owner’s exclusive right to use the registered mark in commerce on or in connection with the goods or services specified in the certificate….” (15 USC § 1057).

Hunting down the Registrant’s website (or what appears to be the Registrant’s website) took some effort and indicated that the Registrant does not even provide the goods listed in the application, but rather is a service provider who consults with manufacturers and retailers.  These third parties use their own trademarks on their goods rather than the Registrant’s mark on Registrant’s goods.  Thus, this registrant starts with a presumption of rights to which it may not be entitled.

So, what is a competitor to do?  Respect a registration that is arguably invalid?  Such undeserved respect can result in the loss of business.  Obtain a clearance opinion from your intellectual property attorney?  Better, but potentially expensive depending upon circumstances.  File a cancellation proceeding?  Useful, but drawn out and potentially expensive.

The proposed amendments to the Trademark Act Of 1946 (15 USC § 1051 et seqq.; see, H.R. 6196; congress.gov); are intended to provide relief against invalid registrations that is faster, easier, and less expensive, than litigation, opposition, or cancellation.

The amendments also add some administrative touches that should make life better all around, but that will also introduce some new docketing deadlines for practitioners.

Third Party Submissions:  An amendment to current Section 1 (15 USC § 1051) will allow third parties to gain admission to a pending application and submit evidence that the legislation euphemistically refers to as “for inclusion in the record of an application…relevant to a ground for refusal of registration.” In other words, “Dear Examiner the Applicant should never have been granted a registration because….” This provision requires both submitting the evidence and giving a concise explanation of the grounds for refusing registration provided by that evidence.  The examining attorney is then entitled to use the information as they believe best.  This amendment will take effect one year after the final bill passes

Flexible response deadlines (amendments to Section 12(b); 150USC § 1062(b)):  This is an administrative touch which allows the Trademark Office to establish intermediate deadlines less than the statutory six months with appropriate extensions available (read:  “pay extension fees”) in a manner analogous to extensions granted by the Patent Office.  In accordance with US membership in certain treaty organizations, minimum deadlines are 60 days.

Expungement (a new Section 16A, inserted after current 15 USC § 1066):  This is a substantive provision adding collateral attacks on registrations short of a full cancellation proceeding.  In particular, expungement is based on a registrant’s failure to ever use the mark in commerce with some (or presumably all) of the goods and services identified in the petition to expunge (“never been used in commerce”).  The attack requires both supporting evidence and a fee, following which the Office has the authority to initiate an expungement proceeding.  Expungement will generally follow the examination steps for new applications, with the Director given rulemaking powers to establish potential exceptions.

A registrant can respond to expungement by documenting evidence of use, consistent with the “in commerce” requirements of 1946 Trademark Act.  The registrant is also given the opportunity to show some excusable nonuse.

Once the expungement evaluation has been completed, the examiner has the right to cancel the registration for any goods or services for which the owner cannot establish use in commerce.

The Director can also start such an expungement proceeding on his or her own initiative.

In each case, however, an expungement proceeding cannot be initiated until three years following the date of registration. This provides both docketing obligations and marketing opportunities for practitioners because it would presumably be a practitioner’s responsibility to remind clients that if they had included numerous goods and services in their application and registration, they will need to show such use for all of those specific items.

Ex Parte Reexamination (and its differences from Expungement; a new Section 16B following the proposed Section 16A):  At first glance, ex parte reexamination appears to track expungement, but there is an important difference.  To repeat, in expungement, portions of the registration are deleted based on the fact that the mark has “never been used in commerce” on those particular goods and services.

Reexamination applies a different standard to a different situation:  registrations for which the mark was not in use on the goods or services on or before “the relevant date.”  Normally that “date” would be the filing date for a use-based application or the statement of use date for an intent-to-use (“ITU”) application.

As in the case of expungement, the party petitioning for re-examination needs to raise relevant arguments and submit supporting proofs, and the Director can again cancel the registration for some or all of the goods depending upon the proof presented.

The timing for re-examination, however, moves differently than expungement.  In particular, once the registration reaches the five year anniversary, re-examination is no longer permitted.  This of course differs from expungement which cannot be initiated until three years after registration, but presumably remains available for the lifetime of the registration.

Again, this will potentially require some additional docketing by practitioners.  At a minimum, practitioners will need to docket this for their own clients, and presumably enterprising practitioners might track competitors’ registrations to give their clients an appropriate opportunity is to seek reexamination if they believe it worthwhile.

In summary, the amendments are attractive to at least the Trademark Office and competitors of registrants with flimsy factual support for their trademark claims.  The Office gets to clear out the dead wood, legitimate registrants have nothing to fear, and competitors get three flanking attacks, each of which appears to be faster, easier, and less expensive than any other current option.

Copyright 2020 Summa PLLC All Rights Reserved

ARTICLE BY Philip Summa of Summa PLLC.
For more on USPTO registrations, see the National Law Review Intellectual Property law section.

Chinese Rail System for Restaurant Meal Delivery Patent Infringed

Perhaps showing the future of restaurants in times of social distancing, defendant Xuansu Company (炫速公司) implemented a restaurant meal delivery system to deliver food to customers using rails from kitchen to customers’ tables thereby avoiding the need for any interaction between customers and restaurant staff.  However, unfortunately for Xuansu, according to the Shanghai Intellectual Property Court , the installed system infringed Chinese patent no. 101282669B and therefore awarded the exclusive licensee, Yunxiao Company (云霄公司), 1 million RMB.

Xuansu’s meal delivery system in operation

The plaintiff argued that the spiral track system installed in the SpaceLab Weightless Restaurant (Space lab失重餐厅) infringed its licensed patent and requested an injunction as well as 8 million RMB.  The defendant countered it was not infringing and used existing technology.

The Court held “Claims 1, 8, 20, 27, 58, and 59 of the patent in question include “the conveyor system transports meals and / or beverages from the back kitchen work area to the customer dining area”, auxiliary transportation devices, rail lines and customer dining areas. The infringing system has all the limitations of the claims including at least one connected dining table, a circular track, and an ordering system,  and therefore falls within the scope of protection of the plaintiff ’s patent rights.”

With respect to the defendant’s existing technology defense, the defendant claimed  US Patent No. 2216357 was prior art. The Shanghai Intellectual Property Court held that the patent publication date was October 1, 1940, which was earlier than the filing date of the patent in question, and it was prior art relative to the patent in question. After comparing the accused infringing technical solution with the prior patent, the Court found that the prior patent does not disclose the technical structure of the parallel track in the accused infringing technical solution, the circular carousel for transferring food to the table, and the guide assembly of the auxiliary conveying device. There are certain differences in the technical structure of the defendant’s system, so the defendant’s defense based on the existing technology cannot be established.

 

A static view of the restaurant meal rail system.
A static view of the restaurant meal rail system in the dining area.
Fig. 35 of the patent at issue owned by HeineMack GmbH and licensed to Yunxiao.

© 2020 Schwegman, Lundberg & Woessner, P.A. All Rights Reserved.

For more Chinese and other nations patent laws, see the National Law Review Intellectual Property law section.

Supreme Court Preserves Availability of Profits Award for Both “Willful” and “Innocent” Trademark Infringement

On April 23, 2020, the U.S. Supreme Court unanimously held in Romag Fasteners, Inc. v. Fossil Group, Inc., 590 U.S. ___ (2020), that the Lanham Act does not impose a “willfulness” prerequisite for awarding profits in trademark infringement actions.

Disgorgement of a defendant’s profits has long been a critical remedy available to brand owners seeking remediation for the infringement of its trademarks.  A profits award can be a proxy for the actual damages suffered by the trademark owner, as actual damages are often very difficult to prove in trademark cases.  Profits awards also serve to deprive infringers of their unjust gains, and can be an important deterrent against infringing activities.  Some federal courts have considered an infringer’s intent as a factor, but not a prerequisite, to awarding a defendant’s profits to the prevailing plaintiff.  Other courts have required proof that the defendant’s infringement was willful before awarding damages measured by its profits, complicating the availability of this important trademark infringement remedy in certain jurisdictions.

The U.S. Supreme Court has resolved this split, finding that a categorical rule requiring a showing of willfulness cannot be reconciled with the statute’s plain language.  Accordingly, prevailing trademark owners do not have to prove willfulness to be awarded the infringer’s profits.

Background

The parties had an agreement allowing Fossil to use Romag’s fasteners in Fossil’s handbags and other products. Romag discovered that the factories Fossil hired in China to make its products were using counterfeit Romag fasteners. Unable to resolve its concerns amicably, Romag sued, alleging that Fossil had infringed its trademark and falsely represented that its fasteners came from Romag.

The U.S. District Court for the District of Connecticut found Fossil liable, and the jury awarded Romag $6.7 million of Fossil’s profits to “deter future trademark infringement.”  The trial court overturned the jury’s damages award because the jury found Fossil acted “callously,” rather than “willfully,” as required by the controlling Second Circuit precedent for a profits award. The U.S. Court of Appeals for the Federal Circuit affirmed the district court’s decision, and the U.S. Supreme Court vacated that judgment and remanded for further proceedings consistent with its opinion.

Overview of Court’s Opinion

Section 15 U.S.C. §1117(a) of the Lanham Act, which governs remedies for trademark violations, states:

When a violation of any right of the registrant of a mark registered in the Patent and Trademark Office, a violation under section 1125(a) or (d) of this title, or a willful violation under section 1125(c) of this title, shall have been established . . . , the plaintiff shall be entitled, subject to the provisions of sections 1111 and 1114 of this title, and subject to the principles of equity, to recover (1) defendant’s profits, (2) any damages sustained by the plaintiff, and (3) the costs of the action. (Underlined emphases added).

Although acknowledging that a defendant’s mental state is a highly important consideration in determining whether a profits award is appropriate, the Court rejected the categorical rule applied in certain lower courts (including controlling Second Circuit precedent) that a plaintiff can win a profits award only after proving that the defendant willfully infringed its trademark.  The Court relied on the plain language in 15 U.S.C. §1117(a) to find that Congress intended to limit such willfulness precondition to a profits award in a suit under Section 1125(c) for trademark dilution. It rejected Fossil’s position that the phrase “subject to the principles of equity” in Section 1117(a) should be read as imposing a willfulness requirement, especially given that Congress prescribed a “willfulness” requirement elsewhere in the very same statutory provision. In no uncertain terms, the Court noted that “the statutory language has never required a showing of willfulness to win a defendant’s profits” in claims under Section 1125(a) for false or misleading use of trademarks (i.e., trademark infringement).

Conclusion

The Court’s decision resolves a split amongst the lower courts and preserves a critical deterrent against trademark infringement by clarifying that Congress intended to allow a trademark owner to recover a defendant’s ill-gotten profits, regardless of whether such infringement was willful.

©2020 Pierce Atwood LLP. All rights reserved.

ARTICLE BY Jonathan M. Gelchinsky and Michael C. Hernandez of Pierce Atwood LLP.

 

For more Trademark Cases, see the National Law Review Intellectual Property Law section.

The Court of Appeals for the Federal Circuit Clarifies that Trademark Protection Is Available for “Graduated” and “Undefined” Color Schemes

There are a number of famous colors that are trademark-protected – such as the color brown, which is registered by UPS, and the color “robin egg blue”, which is registered by Tiffany & Co. This protection stems from the fact that such marks are “inherently distinctive”. That is, the colors have become so readily recognized by the purchasing public as being associated with goods or services. However, some color marks that comprise “undefined” multiple colors, including graduated colors (i.e., where one color fades into another) have generally been treated as never being able to rise to the level of being inherently distinctive.

On April 8, 2020, the United States Court of Appeals for the Federal Circuit (CAFC), held that the Trademark Trial and Appeal Board (TTAB) erred in ruling that an “undefined” color trademark on products and product packaging cannot be distinctive enough for registration unless consumers already recognize it as an indicator of product source. In Re: Forney Industries, Inc., Fed. Cir., No. 19-1073, Opinion 4/8/20.

In its federal registration application, Forney Industries, Inc. described its multi-color trademark as “a solid black stripe at the top” and “[b]elow the solid black stripe is the color yellow which fades into the color red” (emphasis added). Early on, the Examining Attorney at the United States Patent and Trademark Office (USPTO), and later the TTAB, decided that Forney multi-color scheme could not be inherently distinctive.

The TTAB cited two Supreme Court decisions supporting its position – that product and packaging marks using color without defined borders or shape also cannot be inherently distinctive. The CAFC found that the board’s decision overstated the Supreme Court precedent and ruled that the TTAB erred by holding that: (1) a multi-color mark can never be inherently distinctive, and (2) product packaging marks that employ color cannot be inherently distinctive in the absence of a well-defined peripheral shape or border.

The CAFC stated that the correct standard to apply in determining inherent distinctiveness is a legal question, which it could review de novo. The CAFC then recognized that neither the Supreme Court nor it, has directly addressed whether a multi-color mark such as described by Forney can ever be inherently distinctive. Recognizing the “Forney is not attempting to preempt the use of the colors red, yellow, and black, but instead seeks to protect only the particular combination of these colors, arranged in a particular design”, the CAFC concluded that there are instances when a multi-color mark, as well as single-color marks, can be inherently distinctive and, therefore, federally protected via the USPTO.

If your products or product packaging is recognizable by your customers, you may want to consider taking the extra step of applying for federal registration of that color, even if the color is not uniform and blends into other colors. Also, consider consulting an attorney who is well-versed in the area of trademark law to make sure that the description of your color mark is worded the best way possible.

There are a number of famous colors that are trademark-protected – such as the color brown, which is registered by UPS, and the color “robin egg blue”, which is registered by Tiffany & Co. This protection stems from the fact that such marks are “inherently distinctive”. That is, the colors have become so readily recognized by the purchasing public as being associated with goods or services. However, some color marks that comprise “undefined” multiple colors, including graduated colors (i.e., where one color fades into another) have generally been treated as never being able to rise to the level of being inherently distinctive.

On April 8, 2020, the United States Court of Appeals for the Federal Circuit (CAFC), held that the Trademark Trial and Appeal Board (TTAB) erred in ruling that an “undefined” color trademark on products and product packaging cannot be distinctive enough for registration unless consumers already recognize it as an indicator of product source. In Re: Forney Industries, Inc., Fed. Cir., No. 19-1073, Opinion 4/8/20.

In its federal registration application, Forney Industries, Inc. described its multi-color trademark as “a solid black stripe at the top” and “[b]elow the solid black stripe is the color yellow which fades into the color red” (emphasis added). Early on, the Examining Attorney at the United States Patent and Trademark Office (USPTO), and later the TTAB, decided that Forney multi-color scheme could not be inherently distinctive.

The TTAB cited two Supreme Court decisions supporting its position – that product and packaging marks using color without defined borders or shape also cannot be inherently distinctive. The CAFC found that the board’s decision overstated the Supreme Court precedent and ruled that the TTAB erred by holding that: (1) a multi-color mark can never be inherently distinctive, and (2) product packaging marks that employ color cannot be inherently distinctive in the absence of a well-defined peripheral shape or border.

The CAFC stated that the correct standard to apply in determining inherent distinctiveness is a legal question, which it could review de novo. The CAFC then recognized that neither the Supreme Court nor it, has directly addressed whether a multi-color mark such as described by Forney can ever be inherently distinctive. Recognizing the “Forney is not attempting to preempt the use of the colors red, yellow, and black, but instead seeks to protect only the particular combination of these colors, arranged in a particular design”, the CAFC concluded that there are instances when a multi-color mark, as well as single-color marks, can be inherently distinctive and, therefore, federally protected via the USPTO.

If your products or product packaging is recognizable by your customers, you may want to consider taking the extra step of applying for federal registration of that color, even if the color is not uniform and blends into other colors. Also, consider consulting an attorney who is well-versed in the area of trademark law to make sure that the description of your color mark is worded the best way possible.

© 2020 Davis|Kuelthau, s.c. All Rights Reserved

For more on trademark enforcement, see the National Law Review Intellectual Property Law section.

Photographer Unsuccessful in Copyright Case Over Use of Embedded Instagram Photo

User beware – you will be held to a social media platform’s terms of use. Most people are aware by using a social media platform that they give up some rights to the content that they share. What rights and to what extent depends on the platform and the specific terms of use.

A district court in the recent Sinclair case found no copyright infringement by the website Mashable, where it used one of photographer Sinclair’s Instagram photos in an article, even after an unsuccessful attempt to license the photo directly from Sinclair. Sinclair v. Ziff Davis, LLC, and Mashable, Inc., No. 1:18-CV-00790 (S.D.N.Y. April 13, 2020).

Plaintiff Sinclair had a “public” Instagram account and posted a copy of the subject photograph. Defendant Mashable, a digital media and entertainment platform, published on its website an article about female photographers that embedded the publicly posted photo from Sinclair’s Instagram account. Notably, prior to using the Instagram photo, an employee from Mashable contacted Sinclair about licensing the same photo to be used in the article. Sinclair declined Mashable’s US$50 offer to license the use of the photo. Sinclair later demanded that Mashable remove the embedded photograph from their website and demanded compensation. Mashable refused. Sinclair then sued for copyright infringement.

Sinclair argued that Mashable infringed her copyright in the photo since it did not have permission to use the photo. Mashable contended that it had a valid sublicense from Instagram to use the photo and therefore did not infringe Sinclair’s copyright. The court sided with Mashable.

By creating an Instagram account, Sinclair was bound to Instagram’s Terms of Use, which grant Instagram the right to sublicense content that is posted and made public by the user. Instagram then exercised that right by granting Mashable a sublicense to display the photo through sharing the embedded photo. Instagram utilizes API (application programming interface) which allows users to share public content posted by other users. The Instagram policies allow users to use API to embed posts on their websites.

The court held that Sinclair’s right to license the photo directly and Instagram’s right as a licensee to sublicense the photo to Mashable were independent from one another.

Sinclair also contended that the authorization of Instagram to sublicense the photo was invalid because of the complex and interconnected documents which established the rights. While the court agreed that Instagram could make their terms of service and policies more concise and accessible, they were under no obligation to do so.

Lastly, Sinclair argued that it was unfair of Instagram to force a professional photographer to choose between keeping her work “private” on one of the most popular photo sharing apps or to post publicly which would allow Instagram a sublicense to her photographs to users like Mashable. While the court noted this dilemma was very real, the court held that Sinclair had already made her choice by opting to post the photo publicly.

The court also noted that because it held that Instagram had granted Mashable a valid license to display Sinclair’s photo, it did not have to reach the question of unsettled law in the circuit of whether embedding an image is considered a ‘display’ capable of infringing a copyright in an image. That issue was addressed on a motion for summary judgment in Goldman v. Breitbart News Network LLC et al., 1:17-CV-03144 (S.D.N.Y. February 15, 2018), where the court came to the exact opposite conclusion.

In the Goldman case, a different Judge in the same jurisdiction held that the use of embedded Tweets on news media websites featuring a picture of Tom Brady did infringe the copyright of the photographer. The decision for partial summary judgment in favor of the photographer in the Goldman case was highly criticized, and the case ultimately settled outside of court.

While this case affirmed that use of a public Instagram photo as embedded in an article on a third-party website is covered by Instagram’s Terms of Use, this ruling does not necessarily mean that Instagram’s terms grant a blank check regarding the use of publicly posted content. This ruling addressed a specific use of an embedded photo, but did not touch on a litany of other potential concerns when using another’s photo posted publicly on the platform, such as right of publicity, unfair competition, false sponsorship or affiliation, or trademark infringement.

Copyright 2020 K & L Gates

For more on photo & other copyright issues, see the National Law Review Intellectual Property Law section.

The NCAA will Temporarily Allow Student-Athletes to Raise Money for COVID-19 – Here’s How They Can Protect Themselves

The NCAA will allow college student-athletes to raise money for COVID-19 related causes after some controversy over a fundraiser arranged by Clemson quarterback Trevor Lawrence. Lawrence and his girlfriend started a GoFundMe to raise money for food for those struggling during the pandemic. According to ESPN, Clemson compliance officials asked Lawrence to stop the fundraiser, believing it was violating NCAA policy around an athlete profiting from the use of their name, image and likeness. However, the NCAA released a statement that they would allow Lawrence and other student athletes to raise money related to the COVID-19 pandemic.

These types of issues may soon be a thing of the past. This month, the NCAA’s Federal and State Legislation Working Group is expected to report their recommendations on how to allow athletes to profit for the use of their name, image and likeness.

This month, the NCAA Board of Governors is receiving updated recommendations from their Federal and State Legislation Working Group after they ruled in Oct. 2019 that they would allow student athletes the opportunity to profit for the use of their name, image and likeness. The three divisions of the NCAA are analyzing their rules, which they must complete by January 2021.

While we wait for details, there are important topics college student-athletes should begin to understand. One critical legal issue that college student-athletes need to consider is the importance of protecting their potential intellectual property early in their athletic career. Oftentimes, college student-athletes wait to focus on their image and intellectual property until they have declared their entrance into a professional league’s draft. It is during this time period when athletes begin thinking about entering into licensing deals, developing their brand, and preparing trademarks for the commercialization of their brand and image. With the pending changes to the NCAA rules, this timeline moves up and college student-athletes and their families need to start focusing on the following intellectual property issues.

Brand and Image

Given the new stance taken by the NCAA, the development, management and protection of an athlete’s brand will be more important than ever before. With the explosion of social media over the last decade, athletes are more aware of the brand they present to the world; however, the question these athletes need to analyze is: how do they want the public to view them? The outcome of this analysis will help them understand what types of marketing and endorsement deals should they enter into and for how long.

Understanding some of the typical provisions of an endorsement deal are critical for the protection of an athlete’s brand. Does the agreement establish category exclusivity? How long is the term? What is required of the athlete? How does a particular sponsorship or endorsement deal align, or not align, with their college’s sponsorship deals? If a conflict exists, how is it addressed? All of these questions should be addressed in the written marketing agreement. Further, an athlete should to seek advice on ensuring that these provisions are addressed, and addressed in a way that protects the athlete.

Another question that athletes will have to address is whether they are being fairly compensated for the use of their name, image and likeness. Ultimately, the market will determine what it is willing to pay a college student athlete. The metrics for making this decision already exist through looking at social media followers, name recognition, etc. The more of a celebrity an athlete is, the more they will be able to demand in endorsement deal compensation.

Trademarks

Another aspect of the name, image and likeness discussion that will impact college student-athletes is the need to protect their intellectual property. As athletes build their brand, trademark protection might become a necessity. A trademark can range from a players own name, nickname, brand name or logo, or even slogan or phrase that they have used (e.g. NBA’s Kawhi Leonard applying for the trademark “What It Do Baby” after gaining serious popularity in memes and social media postings following the 2019 NBA Finals). A trademark filing will be important, for those student-athletes who have a name, attribute or phrase that they want to commercialize (e.g. NBA’s Anthony Davis’ registered trademark for “Fear The Brow” playing on the nickname of his eyebrows).

When a student-athlete protects his or her brand by filing for a trademark registration, it allows the athlete to stop anyone else from using their intellectual property without their permission. Additionally, thinking about a potential company that wants to use a student-athlete as an endorser, the company will need to ensure it has an appropriate license to use that student-athlete’s intellectual property in its marketing and promotions. In order to protect itself, such a company will likely require that the athlete has protected their own intellectual property.

Domain Names

One additional area of intellectual property protection that college student-athletes (even high school athletes) should understand is domain name registration. An athlete can reserve their own domain name for a minimal amount, typically $15 – $40 per year. However, if they wait too long, they may find the domain name was reserved by someone else.

Some athletes have had the domain name for their own name reserved by someone else and when trying to secure that name, the original owner tries to sell it to the athlete for sometimes tens of thousands of dollars. In 2009, Chris Bosh brought a lawsuit and won in federal court against an organization that had reserved www.ChrisBosh.com and many other athlete domain names.

The Anti-cybersquatting Consumer Protection Act (ACPA), 15 U.S.C. § 1125(d), creates a cause of action for someone registering or using a domain name confusingly similar to a trademark or personal name. The law was established to try and stop “cyber squatters” who register domain names solely with the intention of selling the domain name to the person whose name it references at a profit.

While the law provides this protection, an athlete has to determine whether filing a lawsuit is worth the time and expense to get the domain name back. Oftentimes an athlete will simply use an alternate domain name, an uncommon top-level domain or create their own top-level domain. The lesson here is that athletes, at all levels, should register their name as their domain name in order to avoid these challenges.

Conclusion

While athletes like Trevor Lawrence have the temporary approval to fundraise during the COVID-19 crisis, profiting or from their name, image and likeness will become a reality for all student athletes over the next year. Athletes must protect themselves and ensure they take the appropriate precautions to protect their intellectual property.

© 2020 Porter Wright Morris & Arthur LLP All Rights Reserved.

A Registered Copyright is the Only Way to Guard Against Infringement

The legal world and the media closely monitor every move the Supreme Court makes or considers. However, some rulings attract more attention than others. One that the general public might have overlooked was a 2019 ruling involving infringement claims. Trying to clean up some inconsistent decisions in the Circuit Courts, the high court ruled unanimously that copyright infringement claims are valid only when there is a copyright registered with the United States Copyright Office.

This is a significant shift

Before this ruling, the courts were often more open to protecting copyrightable property even if it was not officially registered with the Copyright Office. For example, the Fifth and Ninth Circuit ruled that protection comes as soon as the owner applies for the copyright and pays the registration fee. The Tenth and Eleventh Circuits, on the other hand, ruled that protection was only valid when the application was approved. In the past, it was sometimes enough to say “patent pending” to dissuade infringers even if the application was later rejected. This phrase is now irrelevant.

What does this mean for applicants?

The processing time can vary but takes several weeks, which means that applicants will are vulnerable during the application process, which can important in fast-moving businesses like technology. Moreover, some thought the application was too long or too expensive. This ruling makes it clear that the only protection is when the companies, inventors, entrepreneurs, or content creators register their idea.

© 2020 by Raymond Law Group LLC.

Trademark Applicant & Chinese IP Agency Fined for Malicious Registration of Coronavirus Related Trademarks

On March 26, 2020, the Shaoxing Market Supervision Bureau of Zhejiang Province fined a Chinese intellectual property firm, a trademark applicant and a trademark agent responsible for attempting to register a trademark for “Li Wenliang” (李文亮), a famous doctor that later succumbed to COVID-19 after earlier attempts to warn others of a possible new outbreak.   Specifically, the Bureau fined applicant Yang Mofang, the agency Shaoxing Intellectual Property Agency Co., Ltd. and the trademark agent Chen Mougang 2,000 RMB, 20,000 RMB and 10,000 RMB respectively. This is believed to be the first time a trademark applicant was fined for malicious filing of a trademark.  This is the second IP agency to be fined.

On March 3, 2020, the Shaoxing Market Supervision Bureau was informed that Shaoxing Intellectual Property Agency Co., Ltd.  represented the trademark applicant Yang Moufang for the trademark registration application of “Li Wenliang.”  On the 4th , the Municipal Bureau’s Trademark Advertising Office and the Comprehensive Administrative Law Enforcement Team conducted surprise inspections of relevant business establishments, conducted administrative interviews with relevant responsible persons  and required them to withdraw their applications immediately. In the afternoon, the agency quickly withdrew the trademark registration application. On the 5th, the Shaoxing Municipal Bureau filed an investigation on the applicant, agency and directly responsible person for the malicious registration of the “Li Wenliang” trademark. On March 26, administrative penalties were imposed on the relevant parties.

Per the Bureau, “Li Wenliang was a Wuhan Central Hospital ophthalmologist  unfortunately infected in the fight against new coronavirus epidemic. After his sacrifice, public opinion in the whole society was highly concerned and he had achieved a high degree of popularity and influence in the country. Several parties in the case knew or should have known these circumstances and still applied for trademarks on Dr. Li, which could easily cause significant social adverse effects.”

© 2020 Schwegman, Lundberg & Woessner, P.A. All Rights Reserved.

For more on IP and other COVID-19 affected industries, see the dedicated National Law Review Coronavirus News page.

COVID-19 Update: Patent Rights in the COVID-19 Pandemic: How will Industries and Governments Respond?

As the world scrambles to address an ever-expanding wave of COVID-19 infections, new and urgent needs for medical supplies, diagnostics and treatments arise.  Shortages of such supplies are plaguing hospitals and care-givers, while doctors and nurses put their lives at risk in their desperate efforts to save COVID-19 patients.  Many of these vital supplies, however, are protected by valuable patent rights.  The essence behind patents rights is to exclude others from making, using, or selling a patented invention, except by authorization of the patent holder in carefully negotiated license agreements to ensure proper compensation for the efforts and costs invested in developing the patented invention.1  On the other hand, the U.S. government has rights to forcibly license a patented invention during times of need, in particular when there is a threat to public safety.2  Will the government resort to use of these available, yet rarely used, compulsory licensing provisions?  How patent owners are responding to the current COVID-19 pandemic is revealing that benevolence may, in some cases, have a place in commercial business without the government needing to exercise its compulsory licensing rights.

In the face of the COVID-19 pandemic, several large companies have come forward with offers to manufacture medical supplies such as masks and respirators.  Manufacturers, such as the auto makers General Motors, Ford and Tesla, are offering to repurpose production lines to help manufacture and increase the supply of ventilators and other much needed medical equipment.3  Fashion and cosmetic companies, such as Louis Vuitton, L’Oréal and Coty, are also pitching in and offering to re-allocate their resources to produce hand sanitizers, while fashion designers, like Christian Siriano and Brandon Maxwell, are offering to mobilize their teams to produce masks and hospital gowns.4  Even the beer company giant, ABInBev will use its facilities to manufacture and distribute hand sanitizer.5

On the patent front, the drug manufacturer AbbVie has taken a bold public health stance by suspending enforcement of its global patent rights on all formulations of the HIV medication, Kaletra (Aluvia) while the drug is being evaluated as a candidate to treat COVID-19 in several clinical trials.  AbbVie’s bold stance would allow generic versions of Kaletra to be made by others without fear of repercussion based on patent infringement.  This would allow countries to purchase generic versions of Kaletra, if it is found effective in treating COVID-19, and would help alleviate possible drug supply shortages.  AbbVie is the first drug-maker to take such a strong public health stance amid the COVID-19 pandemic.  However, whether AbbVie’s decision to suspend its patent rights to Kaletra is an act of pure benevolence, mounting public pressures, or because at least one clinical trial  already suggested Kaletra may not be effective in treating COVID-19, AbbVie’s strong public health stance is at the very least a comforting thought and may hopefully sway other drug-makers, like Gilead Sciences Inc. (“Gilead”), to do the same.

On the other end is the drug-maker Gilead who recently halted emergency access to its COVID-19 candidate drug, Remdesivir, except for pregnant women and children with severe symptoms.6  In suspending access to Remdesivir, Gilead issued a company statement7 on March 22, 2020 citing “overwhelming demand” and “exponential increase” in requests which “flooded [its] emergency treatment access system.”  However, Gilead’s restrictions to Remdesivir come on the heels of it being granted “orphan” drug status8 by the U.S. Food and Drug Administration (“FDA”) on February 23, 2020 and on the heels of a Chinese drug-maker, BrightGene Bio-Medical Technology (“BrightGene”),9 filing for patent protection in China for a combination drug therapy to treat COVID-19 using the active ingredients of Remdesivir.  The 1983 Orphan Drug Act10 allows a seven-year market exclusivity period for pharmaceutical companies developing treatments for a “rare disease” and also provides tax credits.  Gilead’s strategic move to obtain orphan drug status for Remdesivir blocks generic drug manufacturers from supplying the drug and thus further limiting access.

Remdesivir has been previously used to treat the Ebola virus, Middle Eastern Respiratory Syndrome (MERS) and Severe Acute Respiratory Syndrome (SARS), but these infections did not cause a sustained global crisis to earn Gilead a sizable or continued financial revenue stream and other more successful experimental therapies existed.11  If Remdesivir is found to be effective for combating COVID-19, a patent protecting such a use may stand to earn a high and continued stream of global revenue for the patent owner.  As new combination drug patents or method patents for new uses of known drugs may be separately patentable, repurposing Remdesivir as a combination drug patent or for treating COVID-19 may prove to be a blockbuster hit for its patent owner.  Thus, while Gilead has cited overwhelming demand as the reason to restrict access to Remdesivir, one can’t help but wonder whether patent rights and the associated commercial revenue are Gilead’s underlying concern.

Gilead is not the only patent holder invoking a protectionist stance and seemingly attempting to profit from the global pandemic through the patent system’s exclusionary principle.  Labrador Diagnostics LLC (“Labrador”)—a company backed by its major investor SoftBank and who bought patents from a failed blood-testing start-up called Theranos—recently filed a patent infringement lawsuit against BioFire Diagnostics (“BioFire”), a health start-up who launched three COVID-19 tests.12  Labrador also requested an injunction demanding BioFire to stop using the technology covered by the Theranos patents.13  However, since filing the lawsuit and seemingly after public backlash, Labrador issued a press release14 stating it would allow third parties to use its Theranos patents to develop COVID-19 tests with a royalty-free license, but that it is continuing its lawsuit against BioFire for activities over the past six years not related to COVID-19 testing.

Similarly, in Italy, a patent holder of a special respirator valve used in respiratory machines allegedly threatened a patent infringement lawsuit against two engineers who volunteered to use their 3-D printing technology to manufacture the patented valves for a hospital in Brescia, Italy without obtaining permission or a license from the patent holder.15  However, in a follow-up statement, both the patent holder and the two engineers stopped short of calling the communications a threat, and instead characterized them as merely a refusal of the patent holder to assist or collaborate with the engineers.16

While some patent owners are choosing to suspend their global patent rights and others are taking a more protectionist stance, the U.S. government also has the right to take action by forcing patent owners to grant compulsory licenses when there is a threat to public safety.  A compulsory license refers to the government’s authority to grant permission to a party seeking use of another’s patented invention without the consent of the patent owner, and is provided broadly by 28 U.S.C. § 1498.  Several multilateral international agreements also address compulsory patent licenses.17  Other U.S. laws also allow for compulsory licenses in certain circumstances.  For example, march-in rights is a provision of the Bayh-Dole Act of 1980 and is codified in 35 U.S.C. § 203.  March-in rights allow the federal government the right to grant patent licenses to other parties or take licenses for themselves if the patented invention was researched and developed with the help of federally funded dollars.18

March-in rights may be a perfectly poised vehicle for increasing access to COVID-19 related therapeutic drugs and vaccines.  To fight the global pandemic, the Biomedical Advanced Research and Development Authority (“BARDA”), a division of the U.S. Department of Health and Human Services (“HHS”), has partnered with several drug manufacturers, including Johnson & Johnson, Sanofi and Regeneron Pharmaceuticals, to fund the development of treatments and vaccines for COVID-19.19  However, some members of Congress have expressed concern as to the affordability and access should such drugs be found safe and effective, especially since federal funds are being provided.

No U.S. federal agency has ever exercised its power to march-in and license patent rights to others.  For example, advocacy groups have long petitioned the National Institute of Health (“NIH”) to exercise march-in rights for HIV/AIDS related drugs, but have been rejected by the NIH contending that high drug prices are an insufficient reason to break a patent.  However, in the face of a global pandemic, “health or safety needs” may provide a strong basis for the exercise of march-in rights and grant of a compulsory license if more patent owners, like Gilead, take a protectionist patent stance.  On the other hand, if more companies like AbbVie take a more socially conscious approach, there may not be need for government intervention in terms of compulsory patent licenses.  Nevertheless, the availability of this measure may at least provide some comfort and may motivate companies to voluntary suspend their patent rights during this global public health emergency in order to avoid government march-in, or maybe as a pure act of benevolence showing that social responsibility has a place in commercial business.

1   See 35 U.S.C. § § 154, 271.

2   See, e.g., 28 U.S.C. § 1498(a), 35 U.S.C. § 203.

3   See https://www.usatoday.com/story/money/cars/2020/03/22/coronavirus-ventilator-shortage-gm-tesla-covid-19/2895190001/.

4   See https://wwd.com/fashion-news/fashion-scoops/fashion-designers-make-masks-hospital-gown-hand-sanitizer-to-fight-coronavirus-1203545006/.

5   See http://longisland.news12.com/story/41926769/anheuserbusch-to-make-hand-sanitizer-in-response-to-coronavirus-pandemic.

6   See Id.

7  https://www.gilead.com/purpose/advancing-global-health/covid-19/emergency-access-to-remdesivir-outside-of-clinical-trials.

8   See https://www.ibtimes.com/coronavirus-treatment-gileads-potential-covid-19-treatment-labeled-orphan-drug-could-2945353.

9   See https://time.com/5782633/covid-19-drug-remdesivir-china/.

10 Orphan Drug Act of 1983. Pub L. No. 97–414, 96 Stat. 2049.

11 See https://www.statnews.com/2020/03/16/remdesivir-surges-ahead-against-coronavirus/.

12 See https://www.theverge.com/2020/3/18/21185006/softbank-theranos-coronavirus-covid-lawsuit-patent-testing; see also, https://www.businessinsider.com/theranos-patents-fortress-labrador-diagnostics-lawsuit-biofire-coronavirus-tests-2020-3.

13 See Id.

14 See https://www.businesswire.com/news/home/20200316005955/en/.

15 See https://www.law360.com/articles/1255547/3d-printing-as-indirect-patent-infringement-amid-covid-19.

16 See https://www.theverge.com/2020/3/17/21184308/coronavirus-italy-medical-3d-print-valves-treatments.

17 See Convention of Paris for the Protection of Industrial Property, 13 I.S.T. 25 (1962), Art. 5(A)(2) (“Paris Convention”); See Agreement on Trade-Related Aspects of Intellectual Property Rights, April 15, 1994, Art. 31. (“TRIPS Agreement”).

18 See 35 U.S.C. § 203.

19 See https://crsreports.congress.gov/product/pdf/LSB/LSB10422.

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