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GRR News
IP Law In Practice
IP Developments
On the Lighter Side
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                                                           November 2009


 
GRR Intellectual Property News is a newsletter issued by Gottlieb, Rackman & Reisman, P.C., an IP boutique.
 
The purpose of this newsletter to keep in touch with our friends and colleagues as well as provide practical information and news relating to Intellectual Property law.
 
Please forward this newsletter to anyone who might be interested.

Previous issues of GRR Intellectual Property News can be found on our website.
GRR NEWS
GRR Client Prevents Encroachment on its Famous Mark
The trademark HAVAIANAS for footwear is a famous mark.  When the Brazilian owner of the HAVAIANAS mark noticed an unusual number of applicants trying to register similar marks, it asked its Brazilian counsel to take immediate action to enforce its rights in the United States. 
 
Working closely with the client's Brazilian attorneys, Richard S. Schurin and Diana Muller instituted Opposition proceedings in the United States against various entities trying to register word marks including the term HAVANA for footwear.   While the enforcement program continues, five (5) separate applicants have now agreed to abandon their applications. 
Attorney Presentations & Publications
Maria A. Savio's article "Appropriation Art: Is My Work an Infringement or Is My Taking Fair?" appeared in the October 2009 issue of Art Calendar.
 
Marc P. Misthal was interviewed for an article in Tech News World about the introduction of internationalized domain names (see article below).  The article can be found here.
 
GRR is a sponsor of the exhibit Eero Saarinen: Shaping the Future, which will be at the Museum of the City of New York from November 10, 2009 through January 31, 2010.  GRR attorneys James ReismanBarry A. Cooper, Jeffrey M. Kaden, Maria A. Savio, Marc P. Misthal, Diana Muller and Barry Lewin attended the opening of the exhibit on November 9, 2009.
 
Barry Lewin is now a member of the Haydn Proctor Inn of Court, Civil Practice Group.
 
Amy B. Goldsmith was awarded the "Best Off-Broadway Presenter" award by Lawline.com.
 
Diana Muller, President of the Interamerican Association of Intellectual Property's (ASIPI) Licensing Committee, oversaw the compilation and production of a guide entitled "Survey on Trademark License Recordation", which was distributed to attendees of ASIPI's recent meeting in Lima, Peru.
IP LAW IN PRACTICE
FTC Issues New Guidelines Governing Endorsements
On October 5, 2009, The Federal Trade Commission issued new guidelines (available here) detailing how advertisers using endorsements and testimonials can comply with the FTC Act.  The guidelines take effect on December 1, 2009.  After that date, anyone (including consumers, experts, organizations and celebrities) commenting on or endorsing a product or service must comply with the guidelines.  The guidelines apply irrespective of the media in which the comments or endorsements appear and are intended to cover the use of social media (such as Facebook, Twitter, etc.).

The premise underlying the guidelines is complete and truthful disclosure. Thus, the relationship between a commentator and an advertising agency or a commentator and a company providing the product or service  must be clearly disclosed. This requires disclosure where, for example, free products are provided for evaluation, evaluators are paid or a contest is used for receiving evaluations. The guidelines don't require specific disclosure when celebrities appear in advertisements, but disclosure is required outside of the advertising context, including if the celebrity comments on blogs, during media appearances, or during an interview.

Similarly, under the guidelines advertisers can no longer use testimonials to describe atypical results along with a disclaimer saying "results not typical."  If a testimonial refers to atypical results, information about typical results must be disclosed in a clear and conspicuous disclaimer that is understandable to the general consuming public. With respect to typical results, the advertisement must either explain the typical results that a consumer might expect or include the actual results.

Further, the guidelines state that "endorsements must reflect the honest opinions, findings, beliefs, or experience of the endorser." Accordingly, if a person endorses a service or product and implies that they have used that service or product, the FTC will consider such an endorsement to be deceptive and in violation of the FTC Act if the endorser never used the product or stopped using it while the ad is still running.

From a legal perspective, both the advertiser and the endorser are liable for false or misleading statements contained in the advertisement and for failing to disclose material connections.  In view of the new FTC guidelines, anyone promoting or endorsing products or services must be very careful about what they say.
 
For further information, contact Amy B. Goldsmith.

Internationalized Domain Names are Coming
The Internet Corporation for Assigned Names and Numbers (ICANN), the entity responsible for administering the domain name system and technical aspects of the internet, has voted to allow internationalized domain names which will appear entirely in non-Latin scripts (such as Hebrew, Chinese, Arabic and Greek).  Internationalized domain names will permit entire domain names to appear in non-Latin scripts; previously, Top Level Domains, such as .cn or .kr, had to appear in Latin characters.
 
Internationalized domain names will only be available in country code Top Level Domains such as .ru or .gr, and thus will not affect the operation of other domains such as .com, .net or .biz.   
 
Nations and territories may begin applying for internationalized domain names on November 16, 2009.
 
Trademark owners should monitor developments regarding internationalized domain names, as the introduction of internationalized domain names could require trademark owners to register additional domain names to prevent squatters from registering domain names incorporating non-Latin versions of trademarks.
 
More information about internationalized domain names can be found on ICANN's website

For further information, contact Marc P. Misthal.
Fair(ey) Ball or Foul?
Shepard Fairey appeared to have an admirable objective -- upholding the principle of fair use in the copyright law -- when he brought suit against the Associated Press ("AP") seeking a declaration that his now famous HOPE campaign posters of President Obama are a transformative use of a photograph taken by photographer Mannie Garcia and thus a fair use of that photograph.   
 
AP had claimed it owned the copyright in the photograph and that Fairey's use infringed the copyright.  AP took the position that the use was not transformative and thus not entitled to come within the "safe harbor" of fair use. The "fair use" doctrine gives users of another's copyrighted work the right to use it; absent that doctrine the use would be deemed an infringement.
 
In a surprising development, Fairey has now publicly admitted that the photograph he claimed to have copied was not actually the photograph he copied.  Instead, he announced that he had copied a photograph that was much more similar to the image in his posters.  This admission not only compromised his transformative use argument, but is a major blow to his credibility.  Fairey conceded that after he realized the "mistake," he "concealed it," "submitted false images" and "deleted other images" to support the position he initially set forth.  
 
It is ironic that fair use is now being litigated in a backdrop of "unfair" litigation conduct,  and that counsel took litigation postures and made arguments based on facts that are not correct.  There is no turning back. His counsel has reportedly resigned and supporters of the fair use doctrine are left to wonder...what was Fairey thinking?  Fairey has observed that his actions "may distract from what should be the real focus of my case - the right of fair use so that all artists can create freely."  Unfortunately, he is right this time.  In litigation, concealing or destroying documents never turns out well.  More harm is done by that very act then by coming forward immediately and admitting an honest mistake  or even a dishonest one.  Is Fairey too young to remember Watergate? 
             
For further information, contact Maria A. Savio.
Patent Practice Note--Bilski as Applied to Methods of Treatment
One of the hottest topics in patent practice these days stems from In re Bilski, Case No. 07-1130 (Fed. Cir. Oct. 30, 2008).  Bilski is now pending on appeal before the U.S. Supreme Court, but last year the Court of Appeals for the Federal Circuit (CAFC) held that to be patentable under U.S. patent law, method claims in patents must meet the so called "machine or transformation" test, whereby a patent claim must be directed to a particular machine or to a transformation of matter.  In Bilski, the CAFC noted that this test is useful in identifying a method of purely mental steps, which is not patentable under U.S law.  Unfortunately, the CAFC did not address what is sufficient to constitute a machine or a transformation of matter. Even though that issue remains unresolved, but the United States Patent and Trademark Office is regularly applying Bilski to applications pending before it while courts sort out the test.  Many scholars believe that this test will result in a significant reduction in business method patents. 
But how does Bilski apply to methods of treatment?  In Prometheus Labs., Inc. v.Mayo Collaborative Services, the CAFC was presented with the issue of whether Bilski precluded a patent claim for a method of treating a patient.  In Prometheus the claims at issue involved methods of treating a gastrointestinal disorder by optimizing therapeutic efficiency by 1) administering a quantity of a drug including a particular ingredient and 2) determining the level of that ingredient in the patient.  The district court held the claims invalid, explaining that the two steps were merely data gathering or mental steps. 
 
On appeal the CAFC reversed, stating that the Bilski test had been met.  According to the CAFC, the steps met the "transformation" prong of the Bilski test.  It further held that "method of treatment[s] are always transformative when a defined group of drugs is administered to the body to ameliorate the effects of an undesired condition."  A petition for further appeal is presently before the U.S. Supreme Court.

In summary, Prometheus appears to take a broad view of "transformation" and the broad view may be applicable to non-pharmaceutical methods of treatment as well.  However, the pending appeal at the Supreme Court may yet change the test.  In terms of patent prosecution, it remains good practice to articulate the machine or transformation within the claims.

For further information, contact Barry Lewin.
NBA Star Recovers 800 Domain Names From Cybersquatter
Chris Bosh, forward for the Toronto Raptors, is used to winning on the basketball court.  But as a result of victory in federal court, Mr. Bosh liberated 800 domain names corresponding to the names of other athletes and celebrities held by a cybersquatter.
 
Mr. Bosh sued Luis Zavala and his company Hoopology.com in July 2008 to recover the domain name <chrisbosh.com>, which was being used to display pay-per-click ads.  Before filing suit, Mr. Bosh's attorneys contacted Mr. Zavala, but he refused to transfer the domain name to Mr. Bosh.
 
In October, the Federal District Court for the Central District of California ordered Mr. Zavala and his company to transfer 800 domain names to Mr. Bosh, including domain names relating to Jason Kidd, John Gotti, Dale Earnhardt Jr. and a number of other NBA players (a complete list of the domain names can be found here).  Mr. Bosh will, at no charge, transfer any domain name to the person to whose name the domain name corresponds.
 
In a prior decision, the court ordered Mr. Zavala to pay $120,000 in damages and entered judgment in Mr. Bosh's favor.  Mr. Bosh then sought the order transferring the 800 domain names held by Mr. Zavala and his company in satisfaction of the judgment entered by the court.

For further information, contact Marc P. Misthal.
IP DEVELOPMENTS
Copyright for "Daisy" Design Invalidated Based on Prior Floral Design
Royal Printex Inc. v. Unicolors Inc., 91 U.S.P.Q.2d 1439 (C.D. Cal. 2009) 
 
Floral designs are regularly accepted for registration by the Copyright Office. As long as the author of the floral design creates some minimal differences between the new design and prior designs, of which he is aware, the design is accorded copyright protection. The "threshold" for acceptable creativity, the difference between the old and the new, in order to obtain a copyright registration, is quite modest. However, there is some threshold, and below it no copyright protection is available.
 
The daisy flower design that was allegedly infringed in Royal Printex Inc. v. Unicolors Inc., a copyright infringement case, fell below that threshold.  In considering the validity of Royal Printex's copyright registration, the Court found that the author's work was essentially identical to a daisy flower design created some 50 years earlier and shown in a design book. The Court noted that the only difference was that the older work had a ticking stripe for its background and the new work had polka-dots. That change, switching from a ticking stripe background to a polka-dot background, for a daisy flower design, plus keeping no records of the design changes, was insufficient to support a copyright registration and the court invalidated it.

For more information, contact George Gottlieb.
ON THE LIGHTER SIDE
Unusual Inventions
Inventors have been known to be a little eccentric.  This has resulted in some very funny patents, two of which are shown below:
 
toilet aquariumU.S. Pat No. 5,983,411 entitled "Toilet Bowl Aquarium" 
 
There is no doubt that this makes the traditional burial of the aquarium's occupants very convenient.  On the other hand, it may be extremely stressful on the fish to live so close to their final resting place, where every flush may cause them to wonder if their time is up.   


 

 
 
bath capsuleU.S. Patent No. 3,677,263 entitled "Portable Bath Capsule"
 
This invention may appeal to all those parents who have trouble keeping their kids in the bathtub. 
 
 
 
For further information, contact Richard S. Schurin.
Intellectual Property News Editorial Board: Richard S. Schurin (rschurin@grr.com), Marc P. Misthal (mmisthal@grr.com), and Steven Stern (sstern@grr.com) of Gottlieb, Rackman & Reisman, P.C.

Suggestions, questions and comments should be directed to the Editorial Board by email or telephone (212) 684-3900.

For nearly forty years, Gottlieb, Rackman & Reisman, P.C. has provided legal advice and guidance on all aspects of patent, trademark, copyright, and unfair competition law, tailoring its counsel to the specific needs of its clients. 
 
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