Pattishall IP Blog

February 23, 2012

What’s In A (Domain) Name? What A Cybersquatter Calls A Web Site By Any Other Name Would Not Sell For A Million Dollars Or Provide A Platform For A Three-Year Old’s Artwork

Filed under: Cybersquatting — Tags: , , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 3:41 pm

by Phillip Barengolts, Trademark Attorney

In “one [of] a series of domestic disputes between” Paul Bogoni and Vicdania Gomez, Gomez registered the domain names paulbogoni.org and paulbogoni.com without his authorization.[1]  She offered to sell the domain names for $1 million each and posted content on one of them related to certain of her and her daughter’s artwork.  Bogoni sued under the personal name protection provisions of the Anti-cybersquatting Protection Act, 15 U.S.C. § 8131, seeking a preliminary injunction.  He prevailed when Gomez’s defense of use in connection with a copyrighted work failed to show her good faith registration.  Bogoni v. Gomez, No. 11 civ 08093 (S.D.N.Y. Jan. 6, 2012).[2]

Gomez initially populated paulbogoni.org with statements that her three-year old daughter wrote and operated the website, which would donate proceeds to charity from the sale of art objects called “Angel” and “Airplane.”  A message on the site stated, “Hi, I’m Vittoria and this my [sic] first website that my mommy helped me launch in order to begin my journey in making the world a better place.”  The web site advised visitors that the two art objects were constructed at an arts institution named “Make Meaning in the Upper West Side of Manhattan.”  The “Airplane” object was titled “Bogoni.”  Finally, the web site displayed the following statement: “I will am [sic] also selling this domain name www.PAULBOGONI.ORG and www.PAULBOGONI.COM for $1Million (ONE MILLION DOLLARS) each.”  A photograph of “Airplane” appeared on the web site a month after the filing of Bogoni’s complaint and Gomez never explained the relationship between the name Bogoni and the “Airplane.”

Under these facts, Bogoni satisfied his burden to show that Gomez: (1) registered a domain name that consists of his name; (2) did so without the Bogoni’s consent; and (3) had the specific intent to profit from Bogoni’s name by selling the domain name for financial gain.[3]  The court’s analysis turned on the availability of a defense to cybersquatting liability for

“good faith registration of a [personal] domain name . . . if such name is used in, affiliated with, or related to a work of authorship protected under Title 17 . . . and if the person registering the domain name is the copyright owner or licensee of the work [and] the person intends to sell the domain name in conjunction with the lawful exploitation of the work.”

15 U.S.C. § 8131(1)(B).

The Court found that Gomez exhibited an absence of good faith based upon the facts in evidence, and her offer to sell the domain names was not “in conjunction” with the sale of the two art objects.  Thus, she did not qualify for this copyrighted work defense.  The Court’s injunction did not require Gomez to transfer the domain names, however, but only required her to stop using them, which she did by removing all content.  Currently, paulbogoni.org simply states “underconstruction.”

This decision illustrates a key distinction between a claim over the use of a personal name as a domain name under the ACPA versus the Uniform Domain Name Dispute Resolution Policy: the UDRP does not protect personal names that are not trademarks as well, even the names of famous people who do not use their names in connection with a designation for their business.  See http://www.wipo.int/amc/en/domains/search/overview2.0/ (response to question 1.6).  Business executives who find themselves subject to attack or pseudo-extortion through domain names incorporating their personal names may be able to take advantage of this targeted ACPA claim, as well as claims under state laws protecting rights of privacy.

* * *

Phillip Barengolts is a partner with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois.  Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, and unfair competition trials and appeals, and advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues.  Mr. Barengolts’ practice focuses on litigation, transactions, and counseling in domestic and international trademark, trade dress, Internet, and copyright law.  He teaches trademark and copyright litigation at John Marshall Law School, and co-authored Trademark and Copyright Litigation, published by Oxford University Press.

[footnotes]

[1] Although the Court is vague on specifics, this statement is telling: “[T]he parties made clear to the Court during oral argument that the parties’ relationship is, at the very least, contentious.”

[3] The Court discussed at some length whether Bogoni satisfied the third prong of this test because of some prior decisions finding that personal name cybersquatting to recover a debt would avoid liability.  See Carl v. BernardJCarl.com, 409 F. App’x 628, 630 (4th Cir. 2010) (per curium) (unpublished).

For a printer-friendly version, click here.

February 9, 2012

Defendant Hoist Manufacturer Awarded Attorney’s Fees in Trade Dress Case Secalt v. Wuxi Shenxi Construction Machinery

Filed under: Litigation, Trade Dress — Tags: , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 12:30 pm

By Janet Marvel, Trademark Attorney

In Secalt S.A. v. Wuxi Shenxi Construction Machinery Co., Ltd., Nos. 10-17007 & 11-15066, 2012 WL 373102 (9th Cir. Feb. 7, 2012), plaintiff, a manufacturer of traction hoists (typically used for commercial building and window washing), alleged that it owned trade dress rights in the following design:

The Ninth Circuit ruled for the defendant, the maker of an apparently identical product.  The court’s opinion rested on its conclusion that, to paraphrase, no one cares what a traction hoist looks like, as long as it works.  Id. at *4.  Since plaintiff’s design was not the subject of a federal trademark registration, plaintiff was required to prove that it was non-functional and that it had secondary meaning.  Plaintiff could not prove non-functionality.  A design is functional if it “is essential to the use or purpose of the article, or affects the cost or quality of the article.”  Inwood Laboratories v. Ives Laboratories, 456 U.S. 844 n.10 (1982).

The Ninth Circuit, after citing the confusing de jure and de facto definitions of functionality (which have been rejected as unhelpful by the TTAB), considered the much more understandable factors set forth in Disc Golf Ass’n v. Champion Discs, Inc., 158 F.3d 1002 (9th Cir. 1988).  Those factors are:  “(1) whether the design yields a utilitarian advantage, (2) whether alternative designs are available, (3) whether advertising touts the utilitarian advantages of the design, and (4) whether the particular design results from a comparatively simple or inexpensive method of manufacture.”  Secalt, 2012 WL 373102, at *4 (citing Disc Golf, 158 F.3d at 1006).

No factor supported the plaintiff.  Plaintiff’s own engineers testified that the hoist’s features were utilitarian.  There were alternative designs, but they were functional too.  Plaintiff’s own advertising stated that its hoists were rectangular (“cubist” in plaintiff’s trade dress parlance) so they would not roll off of tables.  All hoists cost pretty much the same, so the last factor was neutral.  The court found that plaintiff’s evidence was so lacking that defendant was entitled to its attorney’s fees.

The Secalt case provides the opportunity to revisit a best practice in trade dress protection.

Although a utilitarian design can only be protected for a limited time, and a purely ornamental design does not necessarily function as a source indicator, when designing a product, the  developer has the opportunity to consider adding a unique feature and repeating it throughout a product line.  If this is possible, then the product manufacturer has the opportunity to use the feature to develop and support brand recognition, even after its utility patent for the product expires, at which time copyists otherwise legally would be allowed to create competing identical products.

 *     *     *

Janet Marvel is a partner with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois.  Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, and unfair competition trials and appeals, and advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues.  Ms. Marvel’s practice focuses on litigation, transactions, and counseling in domestic and international trademark, trade dress, Internet, and copyright law.  She co-authored the Fifth Edition of the Trademarks and Unfair Competition Deskbook, recently published by LexisNexis.

For a printer-friendly version, click here.

January 18, 2012

Peter and the Wolf Leave the Public Domain – Supreme Court Holds Copyright Restoration Law is Constitutional

Filed under: Copyright — Tags: , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 5:59 pm

by Uli Widmaier

On January 18, 2012, the U.S. Supreme Court held in Golan v. Holder, No. 10-545, 565 U.S. — (2012), that a law bestowing U.S. copyright protection on certain foreign works that had previously been in the public domain is constitutional under both the Copyright Clause of the Constitution and the First Amendment.  Justice Ginsburg authored the opinion.  Justice Breyer wrote a dissenting opinion, joined by Justice Alito.  Justice Kagan took no part in consideration or decision of the case.[1]

The Supreme Court’s holding is important because it affirms the accession of the U.S. to a system of international IP protection under the Berne Convention for the Protection of Literary and Artistic Works (Berne Convention), the World Trade Organization (WTO), and the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS).  It also clarifies the reach of Congress’s authority under the Constitution to legislate in the copyright arena.

1.     Background

In 1989, the U.S. joined the Berne Convention for the Protection of Literary and Artistic Works.  Article 18 of the Berne Convention provides that “a work must be protected abroad unless its copyright term has expired in either the country where protection is claimed or the country of origin.”  Golan, at 3.  The U.S., however, did not comply with Art. 18.  Prior to 1998, U.S. copyright protection of foreign works was limited.  A foreign work did not enjoy copyright protection in the U.S. for one of three reasons: (1) the U.S. did not protect works from the country of the origin at the time of the work’s publication; (2) the U.S. did not protect sound recordings fixed before 1972; and (3) the work’s author had not complied with certain statutory formalities relating to copyright notice, registration, and renewal, that were formerly required under U.S. copyright law.  See Golan at 1, 4.

When the United States joined both the WTO and TRIPS, continued noncompliance with Art. 18 of the Berne Convention could have given rise to significant sanctions such as “tariffs or cross-sector retaliation.”  Golan at 8.  To bring the U.S. into compliance with Art. 18, Congress in 1998 enacted Section 514 of the Uruguay Round Agreements Act (URAA), codified at 17 U.S.C. §§ 104A & 109(a).  Section 514 “restores” copyright protection to foreign works that were not protected in the U.S. for one of the three reasons set forth above.[2]  Specifically, “restored” copyrights in such works “subsist for the remainder of the term of copyright that the works would have otherwise been granted . . . if the work never entered the public domain.”  17 U.S.C. § 104A(a)(1)(B).

Section 514 grants copyright protection to works that were previously available in the U.S. without such protection.  In other words, it removes these works from the public domain.  This has significant real-world effects.  For example, prior to enactment of Section 514, orchestras could rent the sheet music for famous musical works such as Prokofiev’s Peter and the Wolf, Stravinsky’s A Soldier’s Tale, or the great symphonies of Shostakovich for relatively low fees.  With U.S. copyright in these works newly established, the rental fees became drastically higher, making it economically impossible for many ensembles to afford to perform these works.  See generally Brief of the Conductors Guild as Amicus Curiae supporting Petitioners (filed Nov. 24, 2010).[3]

2.     The Supreme Court’s Analysis

The petitioners appealed from a Tenth Circuit ruling rejecting their argument “that Congress, when it passed the URAA [including Section 514], exceeded its authority under the Copyright Clause and transgressed First Amendment limitations.”  Golan, at 11.  The Supreme Court disagreed, refuting each of the petitioners’ arguments.

(a)     Copyright Clause – “Limited Times”

The Copyright Clause states in relevant part that “Congress shall have Power . . . [t]o promote the Progress of Science and useful Arts, by securing for limited Times to Authors . . . the exclusive Right to their . . . Writings.” Art. I, §8, cl. 8.

Petitioners argued that “removing works from the public domain . . . violates the ‘lim­ited [t]imes’ restriction by turning a fixed and predictable period into one that can be reset or resurrected at any time, even after it expires.”  Golan at 14 (citations and quotation marks omitted).  According to Petitioners, the works in question had enjoyed an initial “limited term” of “zero” duration, and it was unconstitutional to extend that term.

The Supreme Court made short work of the “zero” argument.  “[S]urely a ‘limited time’ of exclusivity must begin before it may end.”  Golan, at 15.  More generally, the Court held, the term “limited times” is “best understood to mean confined within certain bounds, restrained, or circumscribed.”  Golan at 14 (citations and quotation marks omitted).  Section 514 provided a “restrained” and “circumscribed” copyright term for these former public-domain works and thus does not violate the “limited times” clause.  Golan at 14-15.

Moreover, the Court found ample historical precedent of Congress’s removing works from the public domain and giving them copyright protection.  Importantly, the Court noted, “the Copyright Act of 1790 granted protection to many works previously in the public domain.”  Golan at 16.  In short, the Court held, “[g]iven the authority we hold Congress has, we will not second-guess the political choice Congress made be­tween leaving the public domain untouched and embrac­ing [the Berne Convention] unstintingly.”  Golan at 19.

(b)     Copyright Clause – “Promote the Progress of Science and useful Arts”

Petitioners argued that the Copyright Clause mandates that any copyright laws passed by Congress must “promote the Progress of Science and useful Arts.”  Golan at 20.  But a law providing new copyright protection to an existing work in the public domain cannot possibly incentivize the creation of new works.  Therefore, according to Petitioners, such a law is unconstitutional.  Id.  The Supreme Court disagreed.  “A well-functioning international copyright system would likely encourage the dissemination of exist­ing and future works. . . . The provision of incentives for the creation of new works is surely an essential means to advance the spread of knowledge and learning. We hold, however, that it is not the sole means Congress may use “[t]o promote the Pro­gress of Science.” . . . Congress determined that exem­plary adherence to Berne would serve the objectives of the Copyright Clause. We have no warrant to reject the ra­tional judgment Congress made.”  Id. at 22-23.

3.     First Amendment

Petitioners argued that they “enjoyed ‘vested rights’ in works that had already entered the public domain,” and depriving them of these rights by withdrawing the works from the public domain violates petitioners’ First Amendment rights.  Golan, at 26.  The fact that copyright law protects First Amendment interests via doctrines such as the idea/expression dichotomy or the fair use doctrines cannot, in Petitioners’ view, compensate for Congress’s “unprecedented foray into the public domain.”  Id. (quotation marks omitted).

The Supreme Court noted that this argument depends on a premise the Curt had already rejected, “namely, that the Constitution renders the public domain largely untouchable by Congress.”  Id.  Moreover, the Court noted, granting copyright protection to Prokofiev’s Peter and the Wolf or to Shostakovich’s symphonies merely puts these works on equal footing in the marketplace with “music of Prokofiev’s U.S. contemporaries: works of Copland and Bernstein, for example, that enjoy copyright protection, but nevertheless appear regularly in the programs of U.S. concertgoers.”  Golan, at 29.  The Court stated that there is no “free speech principle [that would disarm Congress] from protecting works prematurely cast into the public domain for reasons antithetical to the Berne Convention.”  Id. at 28.

In short, “[b]y fully implementing [the Berne Convention], Congress ensured that most works, whether foreign or domestic, would be governed by the same legal regime.”  Id. at 30.  Neither the Copyright Clause nor the First Amendment prevents Congress from determining “that U.S. interests were best served by our full participation in the dominant system of international copyright protection.”  Golan, at 32.

4.     The Dissent

In dissent, Justice Breyer argued that the Copyright Clause embodies a strong “utilitarian view of copyrights and patents” and places “great value on the power of copyright to elicit new production.”  Golan, Breyer Dissent, at 5, 7.  Therefore, since a law bestowing copyright on existing works that were – often for decades – in the public domain does not in any meaningful way elicit the production of new works, the law – Section 514 – is unconstitutional.  See id.  Justice Breyer also notes the “speech-related harms” arising from Section 514, such as “restricting use of previously available material; reversing payment expectations; [and] rewarding rent-seekers at the public’s expense.”  Id. at 16.

The Court should therefore have scrutinized “with some care the reasons claimed to justify [Section 514] in order to determine whether they constitute reasonable copyright-related justifications for the serious harms, including speech-related harms, which [Section 514] seems likely to impose.”  Id. at 16-17.  Applying such scrutiny, Justice Breyer concludes that “the Copyright Clause, interpreted in light of the First Amendment, does not authorize Congress to enact this statute.”  Id. at 24.

5.     Conclusion

In Golan v. Holder, the Supreme Court strongly affirmed Congress’s authority to legislate freely in the copyright area.  “The judgment §514 expresses lies well within the ken of the political branches.”  Golan, at 32.  Neither the Copyright Clause nor the First Amendment imposes strict or inflexible limitations on Congress’s power.

From a political perspective, the Supreme Court’s decision has the important effect of affirming the place of the United States within the legal structure of international intellectual property law.  In deciding the case, the Supreme Court had Congress’s intent to protect the United States’ international interests firmly in mind.  “Those interests in­clude ensuring exemplary compliance with our interna­tional obligations, securing greater protection for U. S. authors abroad, and remedying unequal treatment of foreign authors.”  Id.

*  *  *

Uli Widmaier is a partner with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois.  Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, and unfair competition trials and appeals. The firm advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues.  Uli’s practice focuses on domestic and international trademark, copyright, trade dress and Internet law and litigation.

[footnotes]

[1] A copy of the opinion and the dissent is available at: http://www.pattishall.com/pdf/golanscotusruling.pdf.

[2] The Supreme Court noted that “[r]estoration is a misnomer insofar as it implies that all works protected under Section 104A previously enjoyed protection. Each work in the public domain because of lack of national eligibility or subject ­matter protection, and many that failed to comply with formalities, never enjoyed U. S. copyright protection.”  Golan, at 10 n. 15.

January 17, 2012

ROLEX vs. ROLL-X: TTAB Says that ROLL-X for X-ray Tables Does Not Dilute Famous ROLEX Mark

Filed under: Dilution, TTAB — Tags: , , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 12:10 pm

By Janet Marvel, Trademark Attorney

In a precedential decision issued on December 5, 2011, the Trademark Trial and Appeal Board (“TTAB”) held that ROLEX was famous for watches under the Trademark Dilution Revision Act of 2006, 15 USC 1125 (c) (“TDRA”), but the mark ROLL-X was not sufficiently similar to create a likelihood of dilution.  See Rolex Watch U.S.A. Inc. v. AFP Imaging Corp., 101 USPQ2d 1188 (TTAB 2011).  The decision provides guidance on the TTAB’s test for determining similarity for purposes of dilution and its interpretation of survey evidence.

AFP Imaging Corp. (“AFP”) filed an application in 2008 for ROLL-X for “x-ray tables for medical and dental use.”  AFP claimed that it adopted the mark as an extension of its DENT-X brand (also for x-ray products).  It also stated that it adopted ROLL-X because the mark evoked the description of its product, namely a rolling tray for taking x-rays.  Both of these facts proved critical to the TTAB’s decision.  Upon publication of the application, Rolex opposed.  The case went to trial on two issues: (1) whether ROLL-X diluted ROLEX by blurring the significance of the ROLEX mark, and (2) whether AFP had a bona fide intention to use ROLL-X.

On dilution, the TTAB found for Rolex on every factor, except two: the similarity of the marks, and AFP’s intent to dilute.  To determine whether the marks were similar for dilution purposes, the TTAB applied its previously iterated test:  “[A]re applicant’s and opposer’s marks ‘sufficiently similar to trigger consumers to conjure up a famous mark when confronted with the second mark?’”  citations omitted.   The Board stated that while the marks were pronounced identically, “[b]ecause of the hyphen between ROLL and X, consumers are likely to view the mark as consisting of the English word ROLL, which has various meanings including ‘to move on rollers or wheels,’…and the letter ‘X,’ which, when the mark is used in connection with applicant’s goods, is likely to be perceived as suggesting the term ‘x-ray’ ….”  The Board cited applicant’s CEO’s testimony, confirming AFP’s intent to create that association.  Because of this stated intent, the Board found there was no evidence that AFP intended to dilute.

The Board also found that Rolex’s own survey supported a lack of dilution.  Forty-two percent of qualified respondents stated that “ROLEX” came to mind when they encountered ROLL-X in a telephone survey.  However, 32 percent said “portable/movable/rolling,” 18 percent said “x-ray tables/equipment” and seven percent said “x-rays.”  While 42 percent would, at least in the context of a confusion survey, be considered a compelling number, “[t[his figure is not persuasive given that a higher percentage…thought of a feature of the goods…or the actual goods themselves."  In other words, respondents understood ROLL-X to convey the impression AFP sought to convey.

The Board cited a common problem with dilution surveys: they prove association, but not likelihood that the applicant's mark will impair the distinctiveness of the opposer's mark."  Since AFP's application was based on intent-to-use, it seems nearly impossible to construct a survey that could establish likelihood of impairment.

The Board also found that Applicant had a bona fide intent to use the ROLL-X mark when it filed the application.  AFP did not have any documentary evidence of its intent to use the mark, therefore, it carried the burden to show that it did have such an intent.  The Board found that AFP's prior use and registration of DENT-X was evidence that "ROLL-X is consistent with an extension of [AFP's] current product line.” In addition, the Board found that AFP’s production of DENT-X x-ray products showed it had the capacity to produce other x-ray-related products, like those to be sold under the ROLL-X brand.

Here, AFP was saved because it could establish that it intended ROLL-X to be suggestive of its products’ characteristics.  Overall, the case emphasizes the significant difficulty of proving a dilution case.  Moreover, it underscores a best practice, namely that applicants should maintain documentary evidence of intent to use trademarks at the time of filing, so that they may overcome oppositions on the basis that they lacked this intent.

*     *     *

 Janet Marvel is a partner with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois.  Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, and unfair competition trials and appeals, and advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues.  Ms. Marvel’s practice focuses on litigation, transactions, and counseling in domestic and international trademark, trade dress, Internet, and copyright law.  She co-authored the Fifth Edition of the Trademarks and Unfair Competition Deskbook, recently published by LexisNexis.

For a printer-friendly version, click here.

January 13, 2012

False Advertising Claim Over Statements In Billing Letter To Patients Not Sufficiently Pled Under Lanham Act

Filed under: Advertising, Litigation — Tags: , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 2:24 pm

by Phillip Barengolts, Trademark Attorney

Ameritox is “the nation’s leader in pain medication monitoring, offering urine drug testing services to help physicians assess medication adherence of patients on chronic opioid therapy.”  Millennium Laboratories is “a national, research-based medication monitoring company whose test offering, technology, customer support, educational resources and experts are specifically focused on clinicians who treat chronic pain.”  Essentially, the companies are urine testing labs that compete in the market for monitoring drug levels in patients who complain of chronic pain because such drugs are very susceptible to abuse.  Ameritox sued Millennium over an alleged scheme to provide improper inducements to physicians to use Millennium’s testing services over those of other companies.  The claims included false advertising under the Lanham Act and a related claim of common law unfair competition.[1]  Millennium moved to dismiss these claims and prevailed (with leave to amend). See Ameritox Ltd. v. Millennium Laboratories, Inc., 8:11-cv-775 (M.D. Fla. Jan. 6, 2012).[2]

As part of this alleged scheme, Ameritox claimed that Millennium provided an “advertisement” to its physician customers that informed patients that they would not be responsible for any additional charges beyond those billed to the patients’ insurance companies or Medicare.  The court identified this “advertisement” as a billing letter, i.e., the letter a patient receives that shows the amounts charged, covered by insurance/Medicare, and owed by the patient.  Ameritox asserted that this letter was misleading because “patients enrolled in Medicare, by law, are not subject to any deductible or co-payments for clinical laboratory services, thus any benefit to a Medicare patient is, in fact illusory.”  It was this letter primarily at issue under the Lanham Act and common law unfair competition claims.

Millennium argued that the letter was not “commercial advertising or promotion,” as required under 15 U.S.C. § 1125(a), because it was sent to patients while the relevant consumers were physicians.  Ameritox countered that: a) the letter was distributed both to patients and physicians; and b) patients also were potential customers.  The court rejected Ameritox’s argument because Ameritox “failed to allege that the Millennium Billing Letter was sufficiently disseminated to the relevant purchasing public.”  Specifically, the court noted that Ameritox’s amended complaint was not clear about who actually was the relevant purchasing public and “how many consumers in the relevant purchasing public Millennium contacted.”[3]

The Court found Ameritox’s factual allegations that the letter was misleading to be sufficient, but at the same time Ameritox had not plausibly pled that the billing letter was likely to deceive potential customers.  The Court did not explain these seemingly contradictory findings beyond stating that Ameritox’s allegation that “Millennium’s statements are…likely to deceive a substantial portion of the targeted customers,” was nothing more than a naked assertion devoid of further factual enhancement – the type of pleading prohibited by the Supreme Court’s decisions in Iqbal and Tombly.  It is not clear what factual enhancement the Court would accept as sufficient to support an allegation of likelihood of deception.  Professor Tushnet wonders whether Ameritox may have to plead that it has a survey in hand. See http://tushnet.blogspot.com/2012/01/pleading-standard-dooms-misleadingness.html.  It seems to this author that explaining how an advertisement is misleading usually would be sufficient to underpin how it is likely to deceive potential consumers.  For example, here (assuming what Ameritox states turns out to be true, as one must on a motion to dismiss), it seems that Ameritox is claiming that patient-consumers are likely to be deceived into believing they are receiving a benefit by having their tests conducted by Millennium because of Millennium’s statements about patients not having to make co-pays, etc.  Perhaps Ameritox needs to be explicit on this point when it amends its complaint, even if such pleading seems above and beyond the notice pleading required by the Federal Rules.

Finally, the Court found insufficient to plead materiality to the purchasing decision Ameritox’s allegation that “Millennium’s false or misleading statements have already, and will continue to, influence materially purchasing decisions to the extent that customers choose Millennium’s services instead of those offered by Ameritox.”  This author sees a pretty direct connection between conveying to a consumer that they don’t have to pay as much when using one company’s service over a competitor’s and the likelihood that the consumer will go with the cheaper provider (essentially, Ameritox alleges that Millennium’s statements convey this type of message).  That is, deception over a price difference seems very material to a consumer’s purchase decision, but maybe that’s just me.  Again, the court may be looking for Ameritox to be more explicit when it re-pleads, but it provided no guidance.

Ultimately, this Court appears to have taken a strict view of the requirements enunciated in Iqbal/Twombly regarding facts that must be pled to support allegations of false advertising under the Lanham Act.  Ameritox was given leave to amend, so we anticipate more specific allegations in the amended complaint.  This decision underscores the need for plaintiffs to be explicit about the impact of an allegedly false advertisement on the target consumers which likely will require more pre-complaint investigation and analysis, as well as artful pleading.  Whether other courts follow this precedent remains to be seen.

*          *          *

Phillip Barengolts is a partner with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois.  Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, and unfair competition trials and appeals, and advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues.  Mr. Barengolts’ practice focuses on litigation, transactions, and counseling in domestic and international trademark, trade dress, Internet, and copyright law.  He teaches trademark and copyright litigation at John Marshall Law School, and co-authored Trademark and Copyright Litigation, published by Oxford University Press.

[footnotes]

[1] Ameritox also asserted claims under the Florida Deceptive and Unfair Trade Practices Act that are not at issue here.

[3] According to the opinion, Ameritox alleged only that “Millennium’s services are offered, advertised, and sold to customers throughout the country.”

January 5, 2012

Using An Employee’s Personal Social Media Accounts Without Her Authorization To Market Employer May Create Liability Under Trademark And Electronic Privacy Laws

Filed under: Advertising, Litigation, Right of Publicity, Trademark (General) — Tags: , , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 10:55 am

by Phillip Barengolts, Trademark Attorney

We’ve all been taught that our work e-mail and social media accounts are owned by our employers, so watch what you say and realize that you have no expectation of privacy in those accounts.  But what happens when an employee uses a personal account to promote her employer?  According to one court, the employer’s use of these accounts without the employee’s authorization can lead to liability under the Lanham Act and the Stored Communications Act. Maremont v. Susan Fredman Design Group, Ltd., Case No. 10 C 7811 (N.D. Ill. Dec. 7, 2011).[1]

The plaintiff, Jill Maremont, was the Director of Marketing, Public Relations, and E-commerce for the defendant Susan Fredman Design Group, Ltd. (SFDG), a prominent interior design firm based in Chicago.  As part of a social media marketing campaign for SFDG, Maremont created a blog on SFDG’s website.  She also promoted SFDG through her personal Twitter and Facebook accounts., including by linking to the SFDG website and blog.  She entered and stored all account access information, including passwords for her personal Twitter and Facebook accounts, on the SFDG server.  She never gave authority to anyone to access her personal Twitter and Facebook accounts. Maremont’s compensation was, in part, based on the overall sales of SFDG, so she had every incentive to promote SFDG.

After suffering a serious accident, Maremont could not work for some time and SFDG decided to continue posting to Maremont’s personal accounts to promote SFDG.  Once she found out, Maremont asked SFDG to stop – but SFDG did not.  After some back and forth about Maremont returning to work for SFDG, she went to another company and sued SFDG over the use of her social media accounts.  (more…)

December 27, 2011

Stylish Baby Bottoms: Kimberly-Clark Wins Copyright Battle Over Diaper Jeans

Filed under: Copyright — Tags: , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 12:23 pm

by Phillip Barengolts, Trademark Attorney

As the father of two little boys, I’ve changed thousands of diapers in the last three years, but never diaper jeans.  Apparently, I’m missing out.  The owner of a copyright in certain diaper jeans sued Kimberly-Clark, which sold jean diapers.[1]  Kimberly-Clark moved to dismiss the claims because the alleged designs were not substantially similar, and prevailed. Pollick v. Kimberly-Clark Corp., Case No. 11-12420 (E.D. Mich. Sep. 23, 2011).[2]   The Court stated, “Perhaps frivolous, Plaintiff’s complaint was plainly objectively unreasonable,” and granted Kimberly-Clark its attorneys’ fees as well.  Images of the plaintiff’s and defendant’s diaper designs are below.

The Judge analyzed the lack of similarities as follows:

First, the color of the diapers: Plaintiff’s diaper comes in two colors, white or light blue; Defendant’s comes in one color, dark blue. Second, the pattern of the diapers: Plaintiff’s diaper comes in two patterns, flat white or flat light blue; Defendant’s comes in one pattern, distressed blue denim. Third, the color of the stitching: Plaintiff’s diaper has red stitching; Defendant’s has either black or gold stitching. Fourth, the front pockets: Plaintiff’s diaper has two pockets, indicated by a straight line and a curved line; Defendant’s has three pockets, the larger two pockets indicated by a single curved line and a rivet at the top, and the third, smaller pocket inset within one of the larger pockets and indicated by a gently curving line and a rivet at the top. Fifth, the front fly: Plaintiff’s diaper indicates the fly with a single straight line (with no button); Defendant’s indicates the fly with a straight line and curved line, a button, and thicker hashed lines representing reinforced stitching. Sixth, the front belt loops: Plaintiff’s diaper has none; Defendant’s has two, one above each larger pocket with thicker lines representing reinforced stitching. Seventh, the back belt loops: Plaintiff’s diaper has none; Defendant’s has three with thicker lines representing reinforced stitching. Eighth, the back label: Plaintiff’s diaper has an embroidered “Diaper Jeans” on the left side of right pocket; Defendant’s diaper has a patch with “Huggies® Little Movers EST. 1975″ above the right pocket between the belt loops. And ninth, the back waist: Plaintiff’s waist is indicated by a single straight line and single v-line; Defendant’s is indicated by a double straight line and v-line.

The above contains considerable factual analysis at the motion to dismiss stage.  Under the Twombly/Iqbal standard articulated by the Supreme Court, to survive a motion to dismiss, a complaint must allege facts that are facially plausible.  Here, a picture is worth a thousand words (actually, 272 in the quoted section).  You be the judge.

For businesses facing a copyright infringement suit, this type of ruling helps pave the way for efficient resolutions of copyright disputes at the pleading stage.  Many judges, however, would not rule at such an early stage of the proceeding, preferring to allow the litigation to play out to a greater extent, including discovery.  This judge had no such qualms and clearly saw this case a certain way.

*     *     *

Phillip Barengolts is a partner with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois.  Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, and unfair competition trials and appeals, and advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues.  Mr. Barengolts’ practice focuses on litigation, transactions, and counseling in domestic and international trademark, trade dress, Internet, and copyright law.  He teaches trademark and copyright litigation at John Marshall Law School, and co-authored Trademark and Copyright Litigation, published by Oxford University Press.

[footnotes]

[1] Yes, they’re the same thing, but the parties insisted on their own names.

December 13, 2011

Judge In New Mexico Issues Temporary Restraining Order Against Research In Motion To Prevent Use Of BBX Mark At Conference In Singapore

Filed under: International, Litigation — Tags: , , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 11:01 am

by Phillip Barengolts, Trademark Attorney

Research In Motion (RIM) planned to introduce its newest mobile platform at the BLACKBERRY developers’ conference (DevCon) in Singapore.  It was going to call it BBX – until Basis International obtained a temporary restraining order against RIM’s use of the name the day before the conference opened.  See Basis Int’l Ltd. v. Research In Motion, Ltd., No. 11‑cv-953, slip op. (D.N.M. Dec. 6, 2011).[1]  Now, RIM is going to call the platform BLACKBERRY 10.  Meanwhile, the suit continues with a hearing on Basis’s motion for preliminary injunction, scheduled for December 19.

The Lanham Act can have extraterritorial application to stop foreign use of an infringing mark under appropriate circumstances.  As stated in the order:

This Court may issue an injunction having extraterritorial effect in order to prevent trademark violations under the Lanham Act where: the extraterritorial conduct would, if not enjoined, have a significant effect on United States commerce, and then only after consideration of the extent to which the citizenship of the defendant and the possibility of conflict with trademark rights under the relevant foreign law might make issuance of the injunction inappropriate in light of international comity concerns.

Id. at 3.

The court decided the facts satisfied these conditions, so issuing a temporary restraining order was appropriate.  From this author’s view, three facts convinced the court: (1) RIM was going to use a mark identical to Basis’s mark; (2) the parties targeted identical consumers, i.e., business software developers; and (3) actual confusion had already arisen – upon RIM’s original announcement of the BBX platform in October, Basis had been contacted about the connection between RIM and Basis.

RIM, a Canadian company, argued that the Lanham Act should not be applied to stop the use of BBX by RIM’s Singapore subsidiary (which was running the conference), but the court found that line of reasoning unpersuasive.  “It is naive to believe that further confusion of the BBX mark in the United States will be confined to only those attending the conference from this country.”  Id. at 4 (emphasis in original).  The court did not explore this conclusion, but did say that “it is not a stretch to state that RIM is attempting global publicity, much of which is aimed at BASIS’s core customer base—U.S. software developers.”

Companies with products in international markets must be cognizant that use of a mark that has a substantial or significant effect on U.S. commerce may result in a violation of the Lanham Act.  This was true even before the age of the Internet, but the Internet has helped blur national boundaries – with no small help from RIM and its BLACKBERRY.

 *          *          *

Phillip Barengolts is a partner with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois.  Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, and unfair competition trials and appeals, and advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues.  Mr. Barengolts’ practice focuses on litigation, transactions, and counseling in domestic and international trademark, trade dress, Internet, and copyright law.  He teaches trademark and copyright litigation at John Marshall Law School, and co-authored Trademark and Copyright Litigation, published by Oxford University Press.

December 8, 2011

“Classic” Case of Trademark Infringement? Top Tobacco and North Atlantic Operating Company Argue Whether CLASSIC CANADIAN and CLASSIC AMERICAN BLEND are Confusingly Similar

Filed under: TTAB — Tags: , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 9:47 am

By Janet Marvel, Trademark Attorney

Top Tobacco, L.P. v. North Atlantic Operating Co., Inc. (TTAB Nov. 21, 2011) (available at http://ttabvue.uspto.gov/ttabvue/v?pno=91180231&pty=OPP&eno=14) shows the very fluid application of facts to law in trademark cases, and therefore, that reasonable minds can differ.  Top filed oppositions before the Trademark Trial and Appeal Board (the “Board”) to various trademark applications filed by North Atlantic for the mark CLASSIC AMERICAN BLEND in logo form and standard characters, and petitioned to cancel North Atlantic’s registration of ZIG ZAG CLASSIC AMERICAN BLEND.  Top based its actions on a claim of likelihood of confusion with Top’s rights in and registration of CLASSIC CANADIAN.  Both parties’ marks covered the same goods, namely, tobacco products.

The Board found CLASSIC CANADIAN and CLASSIC AMERICAN BLEND to be confusingly similar and ruled on the oppositions in Top’s favor.  Given the extreme weakness of the marks, this ruling is somewhat mystifying.  The Board did not consider CLASSIC CANADIAN and ZIG ZAG CLASSIC AMERICAN BLEND to be confusingly similar, however, and denied Top’s petition to cancel.

In the oppositions, the Board evaluated the Dupont likelihood of confusion factors.  Most interesting is its evaluation of the similarity of the marks.  The Board found, not surprisingly, that “[t]he record overwhelmingly establishes that the CLASSIC CANADIAN mark has little intrinsic distinctiveness.”  As to “Classic,” Top’s own statements in the prosecution history for its CLASSIC CANADIAN registration were evidence, although not dispositive, that CLASSIC was suggestive of a “well-known” or “typical” type.

In addition to finding Top’s CLASSIC CANADIAN mark to be weak, the Board also agreed with North Atlantic that the parties’ ten years of co-existence without actual confusion weighed in favor of a finding of no likelihood of confusion.  However, the Board’s agreement with North Atlantic in the oppositions ended here.

The Board was apparently swayed most by the exact identity of some of the parties’ goods, noting that less similarity of marks is required for a finding of likelihood of confusion when marks are used on identical goods than would be required for a comparison of differing goods.  It noted that CLASSIC CANADIAN and CLASSIC AMERICAN were “equally highly suggestive” of a style of tobacco (a finding that could easily have supported a conclusion that the marks were not likely to be confused).  Thus, the Board found in Top’s favor on the oppositions.

However, the Board found for North American on Top’s petition to cancel ZIG ZAG CLASSIC AMERICAN BLEND, finding that inclusion of ZIG ZAG in North Atlantic’s mark “may avoid likely confusion where the marks in their entireties convey significantly different commercial impressions or the matter common to the marks is so suggestive or weak that any source-indicating value it has is overwhelmed by the addition of an arbitrary, distinctive element.”  Top argued that ZIG ZAG CLASSIC AMERICAN BLEND actually created “reverse confusion,” where the junior user’s use overwhelms that of the senior user.  In such circumstances, use of a house mark (like ZIG ZAG) is often held to increase, rather than diminish, confusion.  However, the Board held that there was insufficient evidence that North Atlantic was a ‘significantly larger or prominent newcomer’ who had ‘saturated the market’ with the ZIG ZAG CLASSIC AMERICAN BLEND mark, to have caused reverse confusion.

In this author’s opinion, confusion between these marks in the “real world” seems unlikely.  Board proceedings, however, look primarily at the marks and descriptions of goods in the parties’ registrations/applications.  In this case, neither party relied on a survey, which may or may not have supported a finding of no confusion.  Knowledge of the differences between federal court and Board practice, as well as an understanding of some rather arcane evidentiary rules, is required to effectively litigate a case before the Board.

*     *     *

Janet Marvel is a partner with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois.  Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, and unfair competition trials and appeals, and advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues.  Ms. Marvel’s practice focuses on litigation, transactions, and counseling in domestic and international trademark, trade dress, Internet, and copyright law.  She co-authored the Fifth Edition of the Trademarks and Unfair Competition Deskbook, recently published by LexisNexis.

For a printer-friendly version, click here.

December 6, 2011

“WE THE PEOPLE” Should Avoid Trashing Our Own Trademarks

Filed under: TTAB — Tags: , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 3:52 pm

By Janet Marvel, Trademark Attorney

One of the most common reasons trademark applications are refused registration is that the applied-for marks are confusingly similar to other marks that are already registered.  There may be a great temptation to argue that the applicant’s and registrant’s marks are not confusing because they are among many similar marks.  Therefore, the argument goes, consumers are likely to be able to make fine distinctions among these marks in a “crowded field.”

Such arguments are risky.  They may significantly diminish the value of any resulting registration.  In re Bernstein, 2011 WL 6012206 (TTAB, Nov. 17, 2011 (non-precedential)) illustrates.  There, the Trademark Trial and Appeal Board (“TTAB”) refused to register applicant’s mark WE THE PEOPLE PLAN, for “information about political elections; providing an internet website featuring news and information in the field of national and international politics; providing information regarding political issues, knowing how to vote and knowing how to register to vote.”  The TTAB found the mark confusingly similar to a prior registration for WE THE PEOPLE for “promotion of public awareness of the need for political reform.”

Arguing against the refusal, Applicant, who represented himself, stated:

… [I]t can only be that which follows that can distinguish one mark from another, … It [is] beyond the scope of this letter to even begin to argue against the initial trademark of the sole expression “We The People”, all universal expressions, be it We The People, The Declaration of Independence, LIFE, LIBERTY, and The PURSUIT OF HAPPINESS, … should be required to ADD a follow-on qualifier (as in our case, the word PLAN). To my mind, it’s akin to someone simply registering “United States” … it should be forbidden. It should ONLY be allowed WITH a qualifier “United States X”. … As stated, the weighted emphasis shouldn’t simply be on the WE THE PEOPLE, because it is common to both, … it is vital to look at the next word or series of words keeping in mind that we make NO claim to the expression “we the people” by itself (and as I stated previously, I’m surprised that ANYONE was allowed to because this is one [of] those few expressions that I think belongs to all of us, as Americans … what comes after “we the people” it’s the first phrase in The U.S. Constitution; it’s the expression that identifies ALL Americans AS Americans … the fact, that we are having difficulty being We The People PLAN because someone was allowed to be “we the people” seems strange….

Applicant also submitted a long list of federal registrations including “We the people” as evidence of extensive third party use.  The TTAB refused to consider these for a variety of reasons, including that the marks covered different goods from those of Applicant and Registrant.

Applicant’s arguments were unavailing, and the TTAB affirmed the Trademark Examining Attorney’s refusal to register WE THE PEOPLE PLAN.

Had applicant been successful, its arguments in the record of the prosecution of its registration would have severely limited its ability to enforce its mark against third parties.  Applicant had itself argued that WE THE PEOPLE was such a common phrase that only “PLAN” could distinguish it from other marks.  It would be easy for anyone Applicant accused of trademark infringement to quote Applicant’s own statements, and hence to make a strong showing of no likelihood of confusion.  Thus, while Applicant presumably wanted to register his mark to have a weapon against infringing use, he substantially undercut the value of any registration.

Federal registrations are valuable tools to use in attacking infringement.  However, one must be cognizant in prosecuting a trademark application to protect the value of the resulting registration.  While there is sometimes no alternative to arguing that a crowded field of similar marks allows room for one more, namely the one in the application, where this argument can be avoided, it is often wise to do so.

*     *     *

Janet Marvel is a partner with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP, a leading intellectual property law firm based in Chicago, Illinois.  Pattishall McAuliffe represents both plaintiffs and defendants in trademark, copyright, and unfair competition trials and appeals, and advises its clients on a broad range of domestic and international intellectual property matters, including brand protection, Internet, and e-commerce issues.  Ms. Marvel’s practice focuses on litigation, transactions, and counseling in domestic and international trademark, trade dress, Internet, and copyright law.  She co-authored the Fifth Edition of the Trademarks and Unfair Competition Deskbook, recently published by LexisNexis.

For a printer-friendly version, click here.

Older Posts »

Theme: Silver is the New Black. Blog at WordPress.com.

Follow

Get every new post delivered to your Inbox.

Join 52 other followers