David is a shareholder at Weintraub Tobin. He is a trial lawyer and represents production companies, infomercial companies, direct response companies, and multi-level marketing organizations as to both operational and compliance matters. In particular, David is focused on advertising and compliance issues, including FTC counseling and litigation, class actions, and multi-agency governmental compliance involving the marketing and sale (over multiple media platforms) of various products including educational and health-related products.

As reported in Law 360David Gabor 011_final and other outlets, the First Circuit has ruled that a chicken sandwich, no matter how amazingly delicious it may be, cannot be copyrighted. A Puerto Rican epicure named Norberto Lorenzana argued that he created the “Pechu Sandwich” which is “a fried chicken breast patty, lettuce, tomato, American cheese, and garlic mayonnaise” while working for a Church’s Chicken franchise in Puerto Rico.

According to Law 360, “[h]e sued the company in 2012, claiming it had misappropriated his intellectual property rights in the ‘recipe’ of the Pechu Sandwich and the name of the item itself, but a district court ruled last year that he couldn’t claim ownership of either.”

Entirely unsurprisingly, the First Circuit agreed. In language that may go down in the annals of law next to such well known sayings as “I know it when I see it” (Justice Potter Stewart) and “falsely shouting fire in a crowded theater,” (Justice Oliver Wendell Holmes) Judge Jeffrey Howard wrote, “a chicken sandwich is not eligible for copyright protection.” Boom.


Continue Reading A Chicken Sandwich is Not Copyrightable – Really?

In Russell G. Ryan’s recent thoughtful article in the Wall Street Journal entitled “Get the SEC Out Of The PR Business,” he raised several issues that resonate well beyond the practices of the SEC and into the world of advertising law, direct marketing and FTC enforcement actions. See http://www.wsj.com/articles/russell-g-ryan-get-the-sec-out-of-the-pr-business-1417386821.

The gist of Ryan’s article is that the SEC’s pre-trial press releases and Public Relations “announcements” have the effect of unfairly trying its targets in the court of public opinion. He specifically makes the point that many of the press releases — which are typically made at the very outset of a prosecution — violate the so-called “Cinderella Schools” doctrine. That doctrine, originating from a case involving the Cinderella Career and Finishing Schools, was litigated in the 1970s, and resulted in certain FTC orders being nullified because of due process violations stemming from pre-trial pronouncements by the head of the agency that demonstrated pre-judgment. Supposedly, safeguards were put in place to protect against such violations. However, courts in the meantime, have upheld the right of governmental enforcers to make certain public pronouncements — and the agency enforcers have more than run with it.

As a result, the new crop of press releases are often derogatory, shaming and, in this writer’s view, straightforward violations of due process and the bedrock concept of “innocent until proven guilty.” See, e.g., http://www.ftc.gov/news-events/press-releases/2009/07/ftc-cracks-down-scammers-trying-take-advantage-economic-downturn.

In the web-citation, above, for example, which is from a case I was involved two years ago, the government corralled a number of disparate defendants, and, without so much as preliminary hearing, branded all of them “scammers” — and worse. The fact that the government ultimately prevailed against certain of the targets cannot color the issue, because in other cases, it does not.
Continue Reading The Power of the Press Release II: A Suggestion For Heightened Scrutiny of Governmental Prosecutorial Pre-trial Public Announcements

It’s not exactly a decision in the intellectual property sphere, but a recent ruling by a judge in Oklahoma City, Oklahoma related to a botched call in a high school football game deserves to be called-out for praise.

That case involved a quarterfinal footballgame of a high school league tournament in Oklahoma City. Frederick A. Douglass High School scored on a 58-yard touchdown pass at the last minute to take the lead over its rival, Locust Grove High School.

For some reason, one of the Douglas coaches made physical contact (whether purposely or inadvertently is not known) with a referee on the sideline. That contact resulted in a penalty flag. The rules for this infraction calls for a 5-yard penalty on the extra point attempt or the next kick off. Instead of applying this relatively minor penalty, the officials “went nuclear” and nullified the touchdown. As a result, Locust Grove was declared the winner of the game.

Maybe it was a bad call, maybe it wasn’t. I am certainly not an expert in the niceties of high school football. Although Frederick Douglass High School protested the call, the local association in charge of such things said that its rules did not permit such protest. In light of that, the Association neither permitted Douglass’ request to resume the game with a 1:04 on the game clock or restore the negated touchdown (giving the win to Frederick Douglass).
Continue Reading At Least the Court Didn’t Blow This Call . . . Thoughts on the Oklahoma City High School Football Case

In a sensible decision, the Ninth Circuit Court of Appeals recently ruled that Amazon.com Inc. is not vicariously liable for copyright infringement based upon the conduct of its Associates who use copyrighted photos without permission on their linked websites.

This decision is particularly important because there are an increasing number of “copyright trolls” patrolling various Internet websites. These trolls, sometimes using computerized software to locate allegedly protected images, engage in “hit and run” litigation whereby they identify an alleged act of infringement and then seek a nominal — but still significant  — sum (usually less than $5,000) to instantly settle the case. They even go so far as putting in credit card payment information in their “dunning letters.” Intent is not a factor. The trolls well know that establishing a fair use defense is probably more costly than simply settling the case. An entire industry is now being built on these kinds of spurious lawsuits, where a few years ago a polite takedown notice would have been all that was required.
Continue Reading Vicarious Liability Under the Lanham Act: The Amazon Affiliate Case

Among the unstated powers of the federal (and sometimes state) government that few litigation targets think about is the power of the press release. Prosecutors, whether at the agency level or above (for example, at the state Attorney General’s office or at the Federal Department of Justice), have a hidden tool in their arsenal. It is so simple that many persons and corporations often fail to take it into account in their defense strategy.

Federal regulatory agencies such as the SEC, FCC and FTC, as well as state agencies, have engaged in large-scale public relations campaigns that often seem to undermine the innocent until proven guilty ethos under which they as governmental actors, in particular, labor.

For example, in a recent action by the FTC, the agency conducted a sweep of various infomercial producers which it deemed to be producing false or misleading advertisements. Before even the first court hearing and, in fact, on the same day the complaint was issued, the FTC conducted a carefully-orchestrated press conference to tout their latest “pro consumer” lawsuit. The regulatory agencies usually come up with a fancy “handle” by which they identify their work. These lawsuits often have military-style monikers such as “Operation Clean Sweep,” or “Operation Restore Trust.”

In many cases, a regulatory agency will sue a number of targets, be they advertisers, hedge funds, banks, etc. all at once in coordinated actions. The trouble with this strategy is that while there may be several bad actors in the group, everyone is tarred with the same devastating brush. This is trial by the court of public opinion. The “sweep” is now invariably accompanied by a high-profile press conference, website release and press releases. To even the casual observer, it should be obvious that this strategy is aimed more at making the reputation of the individual agency enforcer than in actually doing justice. While some private plaintiffs like to use press releases as a litigation strategy (usually a bad one), this issue is far worse when the government is a party-plaintiff.
Continue Reading Federal Regulatory Authority and Power of the Press Release