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 Intellectual Property
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September
2010 |
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The
purpose of this newsletter is 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. | |
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| Attorney
Presentations & Publications |
|
Amy B.
Goldsmith will be giving a presentation on Federal Trade
Commission rules, social networking and identity thefit on
September 29, 2010. Click here
for more information.
Amy B.
Goldsmith will be giving a presentation on Fraud and
Identity Theft on October 19, 2010. Click here
for more information.
Diana
Muller and Maria A.
Savio were quoted in an article appearing in Intellectual
Property Magazine about the international reach of
pharmaceutical counterfeiting.
Barry R.
Lewin was named to the Professionalism Committee of the
Monmouth County (NJ) Bar Association.
In August Diana
Muller attended the Brazilian Association of
Intellectual Property's International Intellectual Property
Congress, where the topic for discussion was "Intellectual
Property as a Business Strategy". The growth of the Brazilian
economy is attracting business and investments to that
country. |
| Star
Wars Lightsaber Not Enough to Stop Real
Laser |
|
In an epic battle pitting the
genuine Star Wars Lightsaber against a powerful
real laser manufactured by a Hong Kong company, it seems as if
the Hong Kong company has won the final
showdown.
Earlier this year Wicked Lasers
of Hong Kong began selling a powerful hand held
laser called the Pro Arctic III. Shortly thereafter tech
blogs and other reviewers began comparing the product to "a
real life lightsaber." Then, in July of this year,
Lucasfilm Ltd., owned by Star Wars creator
George Lucas, sent a cease and desist letter to Wicked Lasers,
threatening legal action if Wicked did not stop
selling its Pro Arctic series of lasers. Attorneys
for Lucasfilms took the position that the design of the Pro
Arctic Laser was intended to resemble the hilts
of Lucasfilm's lightsabers. Wicked Lasers responded
by pointing out that it has been selling similar lasers for
years and has never compared its products to the Jedi weapon
wielded by Luke Skywalker, Darth Vader and others. "Most
people feel its kind of ridiculous," said Steve Liu, CEO of
Wicked Lasers, in a press release. Wicked Lasers refused
to stop selling its laser product, and in a final coup de gras
Wicked Lasers put Lucasfilm's original cease and desist letter
up for auction on eBay. There were 73 bids for the
letter, and Wicked Laser sold the letter to the highest bidder
for $3,850.
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| Design Protection Act--Will it Help
the Fashion Industry? |
|
- The IDPPPA creates an entirely new form of
protection for "Fashion Designs"--it does not
give "Fashion Designs" additional copyright protection.
- The IDPPPA only applies to articles of men's,
women's, or children's clothing, including undergarments,
outerwear, gloves, footwear, and headgear; handbags, purses,
wallets, duffel bags, suitcases, tote bags, and belts; and
eyeglass frames. It does not apply to any other
items.
- The IDPPPA's protection extends to the "original"
elements of a protected item or the "original" arrangement
of elements on a protected item where the "original" element
or arrangement is the result of a designer's own creative
endeavor; and is a non-trivial and non-utilitarian variation
over prior designs for similar types of articles. This
will likely give rise to a great deal of litigation over
whether a particular design is "original," "non-utilitarian"
or a "non-trivial variation over prior designs".
- Protection for "Fashion Designs" would last for
three years, and "Fashion Designs" would not need to be
registered to be entitled to protection. The IDPPPA
does not require that a "Fashion Design" bear a notice.
- A "Fashion Design" is owned by the designer, unless the
design was created within the scope of a designer's
employment, in which case the design would be owned by the
designer's employer.
- The issuance of a design patent will terminate the
protection afforded by the IDPPPA. Thus, if an
application for a design patent is filed for a design, the
IDPPPA will protect that design until the design patent
issues. This affords some protection to designers for
the time period between the filing a design patent
application and the issuance of a design patent.
- For there to be infringement, the accused design would
have to be so similar in appearance as to be likely to be
mistaken for the protected "Fashion Design". This
would seem to afford a narrow scope of protection, although
one would expect that, at least initially, there will be
litigation regarding the breadth of such protection.
- Where infringement is found, the party claiming
infringement can seek an injunction as well as its damages
or the infringer's profits, and the court may order the
destruction of infringing items as well as plates, molds,
patterns, etc. used for making the infringing goods.
Whether the IDPPPA will become law remains to be
seen; prior attempts to pass similar legislation have been
unsuccessful. Moreover, if the IDPPPA does become law,
it could undergo changes as part of the usual process of
passing legislation. We will track the progress of the
IDPPPA and keep you informed as to its
status. For further information, contact George
Gottlieb or Marc P.
Misthal. |
| A Puma Stole My
Stripes! |
|
In a game of footsy gone wrong, sneaker maker Keds has
sued another sneaker maker, Puma North America, in
federal court in Massachussetts over Puma's use of stripes on
the side of the sole of its Alexander McQueen Scarred
Street sneakers. A copy of the complaint is available here. Keds, through its parent
company, SR Holdings, Inc., owns three trademark registrations
relating to footwear having two parallel stripes placed
diagonally across the side of the footwear.
Below are one of Keds' trademarks and one of Puma's
sneakers. The sneaker bearing the trademark is on the
left. 
 Do you think that there is likely to be
confusion as to the source of the two sneakers? We will
monitor the status of the case let you know how it is
ultimately decided. For more
information, contact Joshua
Matthews. |
| Proposition 65-No Lead Law-Spreads
Through Fashion Industry |
|
California's Proposition 65 is a California law that
originally dealt with the issue of lead in children's
toys. It has recently spread like wildfire through much
of the fashion industry, to products as diverse as handbags,
wallets, shoes, clothing trim and jewelry. The law is
enforced by so-called public interest groups, who first give
Prop 65 "notice" to large groups of retailers and vendors and
60 days later start lawsuits in California against them.
The cases are virtually always settled because as a practical
matter it is less expensive to settle than it is to
litigate. A list of "prohibited" products that allegedly
cause cancer can be found here. The defensive actions that
vendors can take include placing a "warning label" on all
products sold at retail in California that contain lead or any
other toxic chemical and obtaining indemnities from
up-the-line suppliers. The indemnities should confirm
that the products supplied do not contain any of the
prohibited items and that the suppliers will indemnify
the retailer/vendor from notice letter through a
lawsuit. Vendors may also "opt-in" to prior settlements
in specific product categories as a preemptive step against a
forthcoming claim. For more information, contact
George
Gottlieb. |
| Court Ruling Means False Patent
Marking Cases Will Continue |
|
Standing is a prerequisite for a plaintiff to bring a
lawsuit. In order to have the legal right to initiate a
lawsuit, there must be a case or controversy and the person
filing the lawsuit must show (1) injury or invasion of a
legally protected interest, (2) a relationship between the
injury and conduct that can be traced to the action of the
defendant, and (3) a likelihood that the lawsuit, if favorable
to the plaintiff, will remedy that injury. In our
August newsletter (available here),
we reported on the numerous lawsuits that have been filed in
Federal Court for false patent marking. Most of these
lawsuits were filed by patent lawyers who search stores for
products marked with expired patents or products that
improperly claim "patent pending." A successful
plaintiff can recover up to $500 for each item that has been
falsely marked. The government is entitled to one-half
of any recovery. In a false marking case brought
by a patent lawyer, Raymond Stauffer, against Brooks Brothers,
the district court found that Mr. Stauffer lacked "standing"
and could not bring his lawsuit. It then dismissed the
false marking case. Stauffer appealed. The appeals
court reversed the lower court and found that Stauffer and, by
implication, any private person, had the requisite standing to
bring a false marking case. A copy of the decision is
available here. According to the court
of appeals, the false marking statute, which says that "any
person may sue for the [false marking] penalty," gave Stauffer
the right to sue. He had standing because he was acting
on behalf of the government. The government, in turn,
had standing since false marking inherently injures the
government, the injury can be traced to the acts of Brooks
Brothers and the court could award damages based on the false
marking. In view of the holding in the
Stauffer case, we can expect that false marking cases
will continue to be brought with much
frequency. For further
information, contact Barry A.
Cooper. |
| Latin America: Intellectual
Property Highlights |
|
The protection of Intellectual Property rights in Latin
America will be affected by a series of decisions and laws
that have modified IP regulations in some South American
countries in the past few months:
Brazil: The Brazilian
Trademark Office has begun to grant the registration of
"non-traditional" marks consisting of composite or device
signs such as: holograms, motion and multimedia marks, touch
marks, gestural signs, etc.
Cuba: The Cuban Trademark Office
will no longer accept the class heading or a general list of
goods and services in the international class in which
registration is intended - trademark applications must be
restricted to the specific goods and services covered by the
mark in the market place.
Chile: After 3 years of
discussions, new laws that regulate intellectual property in
Chile were issued by the government on April 23, 2010. The new
laws adapt Chile's IP regulations, especially those governing
copyrights, to a technological world.
Colombia: Colombia missed its
self-imposed deadline to discuss entry into the Madrid
Protocol, and although the plan is for the Congress to
deliberate in the fall, there is no guarantee that a hearing
will be held.
Ecuador: As of June 1, 2010 the
Ecuadorian Patent and Trademark Office has considerably
increased the official fees for filing trademarks, patents and
copyright applications. By way of example, patent application
fees increased from $28 USD to $104 USD.
Honduras: A series of policies
directed to promote the efficiency of the Honduran Trademark
Office have been implemented since April 2010. The Honduran
Trademark Office has will be strictly enforcing filing
requirements and the deadlines for filing documents supporting
a trademark application. Failure to comply with the
deadlines will result in the abandonment of the
application.
Mexico: Customs authorities in
Mexico will create a database of trademark holders to detect
IP irregularities regarding the importation of goods by
unauthorized parties. Therefore, it is important that all the
license and distribution agreements that grant the use of a
trademark in Mexico are registered with the Mexican Trademark
Office in order to avoid seizures of legitimate goods by
Customs.
For further information, contact Diana
Muller or Margarita
Serrano. |
| Single Internet Sale to New York
Address is Sufficient Basis for Jurisdiction |
|
A court must have "personal jurisdiction" over a
defendant to adjudicate a claim against that defendant.
Personal jurisdiction in New York can be obtained over
defendants who do business here, or those that transaction
business here with respect to the matter that is the subject
of the claim. In trademark cases, transaction-based
jurisdiction has generally required an offer for sale or an
actual sale of an allegedly infringing product in the
jurisdiction. But what happens if a sale is an internet
sale, the product was shipped to Manhattan from a distant
state, and the defendant never actually set foot in
Manhattan? Does the New York court in such a case have
personal jurisdiction over the seller where the only act in
New York was the shipment made into the state -- is this
conduct sufficient to satisfy the "transaction of business"
test?
In Chloe v. Queen Bee of Beverly Hills, LLC, a
trademark case involving knock-off handbags, the Court of
Appeals for the Second Circuit recently held that a single act
of shipping an item into New York, combined with the
affiliated business's substantial activity involving New York,
gave rise to personal jurisdiction over the shipper in New
York.
In the case, an administrative assistant at a law firm,
under direction of an attorney, made an Internet purchase of a
handbag. The handbag was shipped from California to New
York. The court explained that it had jurisdiction over
the defendant because the defendant maintained an Internet
commerce site from which the assistant purchased the handbag
and the defendant shipped the handbag to the assistant in New
York. According to the court, this single sale was
sufficient to meet New York's requirement for personal
jurisdiction because the defendant's actions were
purposeful. This was the case even though the defendant
had never set foot in New York.
This decision provides great benefit to trademark holders
in New York, particularly since it is common for knock-offs to
be sold over the Internet. Before this decision, very
often suit would need to be filed in the counterfeiter's home
state, adding considerable expense to litigation. Now,
even one sale to any individual in New York, even to a law
firm employee, is sufficient for a court to find personal
jurisdiction and to keep the case on the plaintiff's "home
turf".
For further information, contact Barry R.
Lewin. |
| The Language of
Money |
|
Trademark owners do not appreciate Google's policy of
selling their trademarks to competitors to use as keywords,
but the most recent court to decide this issue vindicated
Google's approach, for now...the decision has already been
appealed.
In Rosetta Stone Inc. v. Google, Rosetta Stone asked the
Court to enjoin Google from selling the ROSETTA STONE
trademark to third parties for use as a keyword trigger
(Google calls this its AdWords program) for paid
advertisements and in the title and text of paid
advertisements. The Court categorically refused, finding that
(a) there was no likelihood of confusion; (b) Google's use of
trademarks as keyword triggers is functional; (c) Google
didn't intentionally induce infringers to buy the ROSETTA
STONE trademark as a keyword; (d) Google doesn't exercise
control over the use of trademarks in paid advertisement; and
(e) Rosetta Stone failed to prove trademark dilution.
With respect to the issue of likelihood of confusion, the
Court explained that Google's AdWords program is
not intended to confuse consumers as to the source or
origin of ROSETTA STONE software, and the fact that AdWords
using trademarks generates more income for Google than if the
trademarks are not used is irrelevant. The Court
also pointed out that Rosetta Stone's evidence that actual
confusion had occurred was lacking since all of the witnesses
knew they were not purchasing directly from Rosetta Stone,
i.e., the sponsored ads did not cause the witnesses'
confusion. Lastly, the Court said it did not think
confusion was likely since the target audience for a ROSETTA
STONE product is a well-educated person with enough disposable
income to afford a program worth several hundred
dollars.
Perhaps of most interest is the Court's functionality
finding. Since enjoining Google from auctioning trademarks
would make it very difficult for consumers conducting searches
to find the best price for ROSETTA STONE products from
legitimate retailers, the Court found that Google's use of
these trademarks was functional. The Court also found that
Google's generalized knowledge that some purchasers of
trademarks are counterfeiters is not enough to show
intentional inducement or control over the use of the
trademarks, especially in light of the takedown policies.
Finally, Rosetta Stone's dilution argument failed because its
own evidence showed an increase in brand awareness from the
time AdWords were sold. This last conclusion is likely to be
challenged during appeal; Rosetta Stone will argue that
dilution can occur even while brand awareness is
increasing.
Any decision on appeal is months away. Accordingly,
trademark owners who want to prevent the use of their brands
by their competitors must participate in Google's auction for
AdWords and bid to
win. For further information,
contact Amy B.
Goldsmith. |
|
|
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 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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