IP Law Blog

By Jeff Pietsch

Trademark infringement occurs when a third party uses a mark in a way that infringes upon a trademark owner’s exclusive right and use of a trademark. Often, the third party will use a similar mark in a way that confuses consumers as to the source of the goods and services. For example, a fast food restaurant named “Wendi’s” would likely cause confusion with “Wendy’s.” Trademark infringement can occur only when it is likely that consumers will be confused as to the source of the goods. The purpose of this article is to examine the test and factors that courts use to determine if such infringement exists.

Many courts have developed a balancing test to determine if a mark infringes on another. This balancing test has largely grown from the seminal case Polaroid Corp. v. Polarad Elect. Corp., 287 F.2d 492 (2^nd Cir. 1961). In that case, the court identified several variables to consider when assessing if a mark is infringing on another mark. This balancing test seeks to determine if consumers would likely be confused as to the source of the marks. If the test favors that confusion would likely result, then the court will likely rule that infringement exists. On the other hand, if confusion is unlikely or minimal, the court will likely rule against infringement.

By Audrey Millemann

There has been a lot of media attention over the new patent laws (the “America Invents Act”) adopted by Congress and signed by the President in September 2011, six years after being introduced. Commentators have called the Act the most significant change in 60 years (since the 1952 amendments). One of the Acts purposes is to reduce the backlog of pending patent applications (estimated at over 700,000) by expediting the examination and issuance of the patents. Another goal of the Act is to make United States law more consistent with foreign patent laws. 

First to File

The most important change makes the United States a “first-to-file” system instead of a “first-to-invent” system. The new system is more accurately called a “first-inventor-to-file” because the applicant must still be the true inventor. If two inventors invent the same thing, however, the relevant question is not when the invention was conceived, but when the application was filed. The applicant’s date of invention is no longer determinative. Thus, inventors will now be engaged in a race to file an application in the Patent and Trademark Office (“PTO”). 

By Nathan Geronimo

People are better connected with friends and family than ever before.  Social media sites such as Facebook and Twitter can be an excellent way to stay in touch with loved ones, and to get daily updates of people’s lives.  Similarly, through sites such as YouTube, people are able to share videos and information with others almost instantaneously.  While these sites can be great to disseminate images and information to a desired audience, they can also make information readily available to audiences that are less desirable to, and not contemplated by the poster.  There has been a great deal of buzz in recent years about employers using social media sites to perform “background checks” on prospective employees, and warning job applicants to be conscious of this fact when posting on social media sites.  In addition to this concern, recent cases illustrate a possible new concern for social media posters: use of social media posts in litigation.

In a recent decision in Louisiana, Boudwin v. General Ins. Co., Plaintiffs sued an individual and an insurance company based on alleged injuries arising out of a car accident.  In the lower Court, Plaintiff’s prevailed on the question of liability, but were unsatisfied with the jury awards of $25, 000 to the first Plaintiff, and $50,000 to the second Plaintiff.  On appeal, Plaintiffs argued that the jury erred in failing to award them any damages for physical disability or loss of enjoyment of life.  To recover based on a theory of detrimental lifestyle change, a court looks at both the severity of the injury, and Plaintiff’s lifestyle prior to the injury.

By Zachary Wadlé

On Oct. 26, 2011, the Stop Online Piracy Act “SOPA” (H.R. 3261) was introduced in the United States House of Representatives. One of SOPA’s primary goals is to address the continuing problem of online digital piracy of counterfeit movie, music, and other copyrightable works engaged in through foreign websites. 

The 1998 Digital Millennium Copyright Act (DMCA) and the Copyright Act of 1976 are the primary existing U.S. laws that address copyright infringement, but both have limited ability to address foreign based websites that engage in digital piracy. SOPA attacks this problem by giving both government officials and copyright owners new powers to target foreign websites and infringers through the search engines, web hosts, and payment system providers that allow foreign websites to reach the U.S. market. 

By Scott Plamondon

As social media networks become part of the lives and daily routines of more and more people, the use of social media networks in the workplace has begun to highlight a number of issues where an employee’s use of a social media network may interfere with the rights of their employer. A recent case pending before the United States District Court for the Northern District of California presents a familiar problem from the realm of trade secrets, but casts it in a new social media oriented setting. The case is PhoneDog v. Noah Kravitz (N.D., Case No. C11-03474-MEJ).

Noah Kravitz worked for PhoneDog.com where he periodically would offer his opinions concerning new mobile phones as they were released for sale to the public. In order to drive traffic to the PhoneDog website, PhoneDog and Mr. Kravitz employed the use of a Twitter account. Using the Twitter handle of @PhoneDog_noah, Mr. Kravitz was able to attract approximately 17,000 followers, each of whom received real-time updates from Mr. Kravitz regarding his thoughts on various mobile phones, as well as some of his personal opinions on other topics. Upon his departure from PhoneDog.com in October 2010, Mr. Kravitz changed his Twitter handle to @noahkravitz, but continued to use the same Twitter account, effectively taking all 17,000 followers with him when he left. Obviously unhappy with this action, PhoneDog filed a lawsuit against Mr. Kravitz asserting (among other things) a claim for misappropriation of trade secrets. According to PhoneDog’s complaint, Mr. Kravitz’s Twitter account had been developed and maintained for the sole purpose of driving internet traffic to the PhoneDog website, for the sole benefit of PhoneDog. Therefore, according to PhoneDog, Mr. Kravitz’s Twitter account, as well as the password to that account, constitute proprietary, confidential information belonging to PhoneDog. PhoneDog alleged that each of Mr. Kravitz’s 17,000 Twitter followers was worth $2.50 for each month that Mr. Kravitz used the Twitter account after his departure from PhoneDog. Having conjured this $2.50 per user value, PhoneDog alleged that it had suffered $340,000 of damages as a result of Mr. Kravitz’s use of the disputed Twitter account for the eight months following his departure from PhoneDog.

IP Law Blogger Scott Hervey to speak on trademarks and wine labels at wine law seminar for Northern California Wineries and Vineyards.  The programs take place on November 9, 2011 at the facilities of WGC client Oak Ridge Winery, and on November 17, 2011 at the Amador County Fairgrounds.  For more information go to www.motherlodewinelaw.com

With the launch of each new Top Level Domain (“TLD”), brand owners are always concerned about protecting their trademark rights and preventing individuals from cybersquatting. The .xxx TLDs are coming and brand owners have only a very short period of time left to take proactive steps to prevent their brands from being used in connection with an adult entertainment website.  If you are the owner of a registered trademark outside the adult entertainment industry, chances are you do not want to see your trademark used as an .xxx domain by an adult entertainment website. Such use can potentially harm your trademark rights or adversely affect the goodwill associated with your business or products. There are steps that you can take to prevent others from registering your trademark in connection with an .xxx domain name, but time is running out.

by Dale Campbell

The long-held rule in the Ninth Circuit was that a plaintiff, in a copyright infringement claim, is presumed to have suffered irreparable harm upon a showing of likelihood of success. (Elvis Presley Enterprises, Inc. v. Passport Video, 249 F.3d 622, 627 (9th Cir. 2003).) Two Supreme Court decisions cast doubt on the continued liability of that precedent, a doubt that was lifted in August 2011 when the Ninth Circuit overruled its own long line of precedents – hence, the Court’s poignant observation that “Elvis has left the building.”[1]

The decision overruling the Elvis presumption of irreparable harm is Flexible Lifeline Systems, Inc. v. Precision Lift, Inc., et al., Ninth Circuit Case No. 6:10-CV-00044, filed August 22, 2011, 2011 U.S. App. LEXIS 17462. The plaintiff, Flexible Lifeline Systems, Inc. (“Flexible”) claimed sole ownership of technical drawings for the manufacturing of aircraft maintenance stands used to repair aircraft.[2] Defendant Precision Lift was a company that had sold Flexible’s aircraft maintenance stands for a number of years. In 2008, Flexible and Precision entered into a joint venture to design, manufacture, and sell aircraft maintenance stands to the United States Air Force. Flexible and Precision designed custom maintenance stands and submitted an initial proposal to the Air Force. For various reasons, the joint venture broke down and was terminated.  Precision found another joint venturer and utilized the design plans developed in conjunction with Flexible to continue with its proposal to the Air Force.

By Nathan Geronimo

In a recent opinion, the Ninth Circuit clarified the defense of copyright misuse, finding the defense inapplicable in a dispute between Apple Inc. and Psystar Corp. Apple, one of the most prolific software producers in the world, sued Psystar for copyright infringement based on Psystar’s practice of copying Apple’s Mac OS X operating software for use in Psystar computers. Essentially, Psystar would make a master copy of the Mac OS X software, and install a copy on one of their computers. Psystar would then bundle the computer for sale with an unopened packaged version of MAC OSX that it would purchase from any number of retailers. Psystar would purchase these copies so it could assert that it had purchased the software to run on each computer it sold, when actually the computers would run on the pre-installed copied version of Mac OS X.
Prior to the Ninth Circuit appeal, the Northern District held that Psystar was infringing on Apple’s copyrights in Mac OS X. Psystar argued that the defense of copyright misuse made Apple’s Software License Agreement unenforceable.
 

By James Kachmar

The affirmative defense of copyright misuse is a court-created affirmative defense to copyright infringement which flows from a similar defense in patent litigation. In 1942, the U.S. Supreme Court in Morton Salt Co. v. GS Suppiger Co. recognized the affirmative defense of patent misuse where a patent holder attempted to maintain an infringement action by improperly tying the use of its patented product to one of its unpatented products. The Supreme Court held that this improper tying of a patented product to an unpatented product required that equity “withhold its assistance from such a use of the patent by declining to entertain a suit for infringement [until] the improper practice has been abandoned ...”.

In 1990, the Fourth Circuit Court of Appeal became the first federal appellate court to extend the patent misuse defense to copyrights. On September 28, 2011, the Ninth Circuit issued its opinion in Apple, Inc. v. Psystar Corporation which addressed the important issue regarding the application of the “copyright misuse” affirmative defense in the context of a software licensing agreement.