Generic trademarks are those which, due to their popularity and/or common usage, have become synonymous with the products or services. Such trademarks include Kleenex, Band-Aid, Jeep, Aspirin, and Cellophane. Such marks, generally, cannot be federally registered or protected under the Lanham Act due to the marks direct reference to the class of product or service it belongs to. In other words, it fails to distinguish the good or service from other goods or services in the marketplace.

Breaking ways with this long-standing body of law, the U.S. District Court for the Eastern District of Virginia reversed a Trademark Trial and Appeal Board (“TTAB”) decision denying trademark applications for BOOKING.COM. The plaintiff in that action previously filed a federal trademark application for BOOKING.COM for both travel agency services and for making hotel reservations for others in person and via the internet. Plaintiff already had an international trademark registration for the same services pursuant to the Madrid Protocol.

During the USPTO’s review the plaintiff argued that the marks had acquired distinctiveness, but the USPTO refused to register the mark due to its genericness. The plaintiff appealed the decision to the TTAB, which affirmed the USPTO’s refusal. In doing so, the TTAB stated that “.com” did not impact the genericness.

On appeal, the Eastern District of Virginia first examined whether BOOKING.COM is generic. In doing so, it first analyzed BOOKING and .COM separately before analyzing them in conjunction. The Court found that that BOOKING is generic for the relevant services. When analyzing BOOKING.COM as a whole, however, plaintiff argued that the combination of the generic word BOOKING and .COM created a unique designation of the source of the services.

The Court found that when combined with a second-level domain, top-level domains, such as .com, typically have source identifying significance.  The Court further held that second-level domain and top-level domain combinations generally create descriptive marks that are protectable upon acquiring distinctiveness. The reasoning stemmed from the Court finding that a top-level domain plus a second-level domain equals a domain name, which is unique and can only be owned by a single entity.

Next, the Court analyzed whether BOOKING.COM had acquired distinctiveness. Finding that the plaintiff offered sufficient evidence that consumers identify BOOKING.COM with a specific source, not just a reference to services provided, the Court held that BOOKING.COM had acquired distinctiveness, but only as to hotel registration services, not travel agency services. Accordingly, the Court ordered the USPTO to register BOOKING.COM as to those services, and remanded the matter to the USPTO to determine whether the design and color elements in two of the applications, in conjunction with the protectable word mark, were eligible for protection.

So, what does this mean? In short, it means that although a party may be unable to register its generic mark alone, it may be able to combine the generic mark with a top-level domain to create a registrable trademark. But although this undoubtedly provides some benefit, such trademark owners should heed the Eastern District’s warning that such marks will not be according broad protection.

For those of you that watched the red carpet happenings at last year’s Golden Globe Awards, you may have noticed the “Fiji Water Girl”, a model standing ready to keep Hollywood glitterati hydrated with bottles of Fiji water, photobombing numerous shots of celebrities.  Her presence on the red carpet created a social media firestorm and the Fiji Water Girl – a model named Kelly Steinbach – garnered instant and substantial notoriety.  Now this notoriety has evolved into a lawsuit, pitting Steinbach against the very brand of water she was representing.  It appears that Fiji created numerous life-size cardboard cutouts of Steinbach from a photo of her on the red carpet at the Golden Globes holding a tray of Fiji water and placed them at grocery stores and at other retail point-of-sale locations.  In fact, People Magazine published a picture of John Legend leaving a Beverly Hills grocery store with the cardboard cutout of Steinbach in the background next to a display of Fiji water.  Steinbach claims that Fiji never had her permission to use her likeness in such a manner and such use by Fiji violates her right of publicity.

California Civil Code Section 3344 states, in pertinent part:

Any person who knowingly uses another’s name, voice, signature, photograph, or likeness, in any manner, on or in products, merchandise, or goods, or for purposes of advertising or selling, or soliciting purchases of, products, merchandise, goods or services, without such person’s prior consent….shall be liable for any damages sustained by the person or persons injured as a result thereof.

The entire purpose of 3344 is to allow individuals to control any commercial interest they may have in their persona.  That said, every use of a person’s likeness in connection with a commercial product or service is not actionable.  Section 3344(e) states that:

[I]t shall be a question of fact whether or not the use of the person’s name, voice, signature, photograph, or likeness was so directly connected with the commercial sponsorship or with the paid advertising as to constitute a use for which consent is required.

The statute also contains a “safe harbor” for use in any news, public affairs, or sports broadcast or any political campaign.

Most contested right of publicity cases address the fine line between commercial use and a protected First Amendment use.  Although the Supreme Court provided guidance in Comedy III Prods., Inc. v. Gary Saderup, Inc. for determining the difference between protected First Amendment speech and the actionable usurpation of an individual’s right of publicity, balancing tests are never as clear as practitioners would like them to be.

Here however, it seems like a clear case, but like any good Hollywood movie, there’s always a twist.  Fiji claims that the lawsuit is frivolous and without merit.    Fiji claims that “[a]fter the Golden Globes social media moment, [it] negotiated a generous agreement with Ms. [Steinbach].”  Fiji even claims there is a videotape of Ms. Steinbach signing an agreement; Steinbach claims that the agreement was not really an agreement and the signing was a staged event.  Fiji claims that Steinbach “blatantly violated” the agreement between them and stated that it’s confident that it will prevail in Court.

Prior to the Leahy-Smith America Invents Act (“AIA”), the patent statute (35 U.S.C. § 102(b)) prohibited patenting an invention that was “on sale in this country, more than one year prior to the date of the application for patent in the United States.”  This limitation on patentability is often referred to as the “on-sale” bar because it prohibits, or bars, an inventor from obtaining a patent when the invention was on sale more than one year before the patent application was filed.  In fact, all patent statutes since 1836 have included an “on-sale” bar provision.  The motivation behind the bar comes from the U.S. Constitution, which authorizes Congress “[t]o promote the Progress of Science and useful Arts.”  Long ago, the Supreme Court determined it would impede “the Progress of Science and useful Arts” to permit an inventor to sell his or her invention while keeping the secrets of his or her invention from the public and then later get a patent when faced with the danger of a competitor.  This would improperly offer a premium, such as longer protection than the standard patent term, “to those who should be least prompt to communicate their discoveries.”  See Pennock & Sellers v. Dialogue, 27 U.S. 2 Pet. 1 1 (1829).

But what does it mean for an invention to be “on sale”?  Does the sale have to make the invention available to the public?  Does the invention have to actually be sold? Does merely offering the invention for sale trigger the on-sale bar provision?  Interpreting the pre-AIA, “on-sale” bar, the Supreme Court determined that an invention was “on sale” when two conditions are met.  First, the invention is “the subject of a commercial offer for sale,” and second, the invention is “ready for patenting.”  In other words, a mere offer for sale triggers the “on-sale” bar whether or not the sale is made.  Further, the sale or offer for sale does not have to make invention available to the public for the invention to be “on sale” and thus subject to the “on-sale” bar provision.

The AIA, however, modified the language for the “on-sale” bar provision.  Under the AIA’s 35 U.S.C. § 102(a)(1), a person shall be entitled to a patent unless the claimed invention was “… on sale, or otherwise available to the public before the effective filing date of the claimed invention.”  This change raised a question as to whether, under the AIA, a sale has to make the invention available to the public to trigger the AIA version of the “on-sale” bar.  In other words, does the phrase “otherwise available to the public” limit the types of sales that trigger the bar or can “secret sales,” such as sales under a non-disclosure or confidential agreement, still trigger the bar as they did under the pre-AIA, “on-sale” bar.

On January 22, 2019, the Supreme Court answered these questions in Helsinn Healthcare S.A. v. Teva Pharmaceuticals USA, Inc.  Specifically, in Helsinn, the Court addressed “whether the sale of an invention to a third party who is contractually obligated to keep the invention confidential places the invention ‘on sale’ within the meaning of § 102(a).”  The Court unanimously held that a confidential sale to a third party triggers the “on-sale” bar provision.  Thus the AIA did not alter the meaning of “on sale.”

Looking at the facts in Helsinn and the Court’s reasoning provides further insight.  Specifically, Helsinn owns four patents, which all claim priority to a provisional patent filed in 2003, related to the drug palonosetron used to treat chemotherapy-induced nausea.  One of the patents, the ‘219 patent, is governed by the AIA and the other three are governed by pre-AIA law.  Nearly two years before filing the provisional patent application, Helsinn entered into two agreements with MGI Pharma, Inc. (“MGI”) whereby MGI would purchase the drug from Helsinn and keep all proprietary information received under the agreements confidential.  Helsinn and MGI announced the agreements in a joint press release, and MGI reported the agreements in its Form 8-K filing with the SEC.  However, they did not disclose specific dosage formulations covered by the agreements.

Teva Pharmaceuticals USA, Inc. (“TEVA”) sought FDA approval to market a generic version of the anti-nausea drug.  In response, Helsinn sued TEVA for patent infringement.  TEVA argued the ‘219 patent was invalid because the invention was on sale more than one year before Helsinn filed its provisional patent application.  The District Court agreed with TEVA concluding that “an invention is not ‘on sale’ unless the sale or offer in question made the claimed invention available to the public.”  On appeal, the Federal Circuit reversed finding that “’if the existence of the sale is public, the details of the invention need not be publicly disclosed in the terms of sale’ to fall within the AIA’s on-sale bar.”  Therefore, “[b]ecause the sale between Helsinn and MGI was publicly disclosed, it held that the on-sale bar applied.”

The Supreme Court then “granted certiorari to determine whether, under the AIA, an inventor’s sale of an invention to a third party who is obligated to keep the invention confidential” triggers the on-sale bar provision.  The Court pointed out that the AIA “retained the on-sale bar and added the catchall phrase ‘or otherwise available to the public.”  Therefore, the question was whether the altered language changed the meaning of the “on sale” bar.  The Court pointed to the well-settled, pre-AIA precedent that sales and offers for sale did not have to be public to trigger the on-sale bar provision.  In fact, the Court acknowledged that the Federal Circuit had explicitly recognized the implicit precedents of the Supreme Court that secret sales can invalidate a patent under the pre-AIA “on sale” bar.  “In light of this settled pre-AIA precedent on the meaning of ‘on sale,’” the Supreme Court presumed “that when Congress reenacted the same language in the AIA, it adopted the earlier judicial construction of that phrase.”  “The new § 102 retained the exact language used in its predecessor statute (‘on sale’) and, as relevant here, added only a new catchall clause (‘or otherwise available to the public’).”  The Court determined that merely adding “or otherwise available to the public” was “simply not enough of a change” to “conclude that Congress intended to alter the meaning of the reenacted term “on sale.”  Therefore, the Court held that “an inventor’s sale of an invention to a third party who is obligated to keep the invention confidential” can bar patentability under the AIA “on sale” bar provision.

When a new invention is created (if it is worth anything), everyone wants to take credit. Figuring out whose “baby” it is, is a difficult question.

What is an inventor? Who is the inventor? One would think these questions have straightforward answers. They do not. Inventorship is one of the most difficult and gray areas of patent law.

It is easy to say what (or who) an inventor is not. An inventor is not the research technician who carries out the instructions of the lead investigator developing a new drug. An inventor is not the computer programmer who writes the code for software developed by someone else. An inventor is not the machinist who fabricates a device under the direction of the engineer. An inventor is not the CEO of the company, the most important shareholder, the leading investor, or the supportive colleague. An inventor is not a corporation or other business entity.

The inventor is the person (a natural person) who “invents” the invention. Inventing consists of three phases: conception of the invention; steps taken toward reducing the invention to practice; and reduction to practice of the invention. The person, or persons, who perform the first phase, conception, are the inventors. The person(s) who perform the second and third phases can be the inventor(s) or those acting at the direction of the inventor(s).

Conception is the formation of the definite and permanent idea of the complete and operative invention. This means that the structure and function of the invention have been fully thought out. If the inventor can describe how to make and use the invention, such that a person with ordinary skill in the art could make and use it, then there is conception. The inventor may have others help actually make the invention, but this does not make them inventors.

Any person who makes a contribution to the conception of the invention is an inventor. Multiple inventors are called joint inventors. The determination of whether a person is a joint inventor is very fact-specific. Joint inventors must be working together in some sense, although they need not work together physically or at the same time. Joint inventors cannot be working completely independently; if so, they are not joint inventors, but sole inventors of the same invention. The contributions of the joint inventors need not be of the same size or significance. The contribution of a small, minor aspect of the invention is enough to make a person a joint inventor as long as that aspect is contained in at least one claim of the patent.

If there is more than one inventor of an invention, each inventor owns an equal, undivided interest in the invention and in any patent on the invention. This is true regardless of the amount of the inventor’s contribution. Each inventor can make, use, offer to sell, or sell the invention in the United States, or import the invention into the United States, without the consent of the other joint inventors. In order to transfer all the rights to an invention, all of the joint inventors must sign an assignment.

All of the inventors must jointly file a patent application. Each inventor must sign the oath or declaration. All of the true inventors must be named as inventors, and the application cannot name a person who is not an inventor. For example, an inventor cannot be excluded because he or she is no longer employed by the company filing the patent application. Nor can a person who is not an inventor be named as an inventor simply as an acknowledgment or reward for working on the project. Errors in inventorship can be corrected by amending the patent application, or the issued patent, as long as the error was unintentional.

Inventorship problems occur frequently in companies where several employees work together on a project that results in an invention. The existence of joint inventors raises two problems. First, because each joint inventor owns, and has full rights to exploit, the invention, all of the inventors need to sign an assignment to the company if the company is to obtain clear title to the invention. It is easiest to do this before the employees are hired or, if not, before they leave the company. It is often not done until after the employee has left the company, however, and the company decides to file a patent application. Second, a patent that issues with incorrect inventorship (either omitting an inventor or including a non-inventor) is at risk of being invalidated, unless a correction is made. In other words, years after the invention was invented, when the company is in litigation to enforce its patent, the issue of inventorship can be raised as a basis for invalidating the patent. Thus, inventorship issues should be resolved as early as possible, hopefully before the patent application is filed.

The Federal Circuit Court of Appeals has affirmed a jury verdict of $140 million in a patent infringement case.  The damages were based on a reasonable royalty.  The case is Sprint Communications Co., L.P. v. Time Warner Cable, Inc., 2018 U.S. App. LEXIS 33594 (Fed. Cir.  2018).

Sprint sued Time Warner in the District of Kansas for infringement for several of Sprints patents for a telephone communications network.  Sprint alleged that Time Warner’s voice over internet protocol (VoIP) service infringed Sprints telecommunications patents.  The case was tried to a jury.  At trial, the district court admitted Sprints evidence of another jury verdict Sprint had obtained in a different case over the same patents against Vonage Holdings Corporation.  The court found that the evidence was relevant to the jury’s determination of reasonable royalty damages using the hypothetical negotiation theory of determining the royalty.  The jury awarded Sprint reasonable royalty damages of $140 million, calculated as $1.37 for each of Time Warner’s subscribers to its VoIP service.

On appeal, Time Warner argued that the district court should not have admitted evidence of Sprint’s verdict against Vonage because that royalty was based on the total amount of Vonage’s revenues, rather than the amount apportioned to the patented aspects of the product.

The Federal Circuit affirmed the jury’s verdict.  The court held that the district court had properly admitted the evidence of the Vonage verdict.  The court found that an apportionment between the patented and unpatented aspects of a product is not required if the Georgia-Pacific factors are used to determine the royalty.  The Georgia-Pacific case sets for a long list of factors, which the Federal Circuit has approved, that are relevant in determining a reasonable royalty.  Under Georgia-Pacific, the royalty rates for comparable licenses are relevant even if the royalty rate is based on total sales rather than sales of the patented component.

Here, the court found that the jury had considered two other comparable licenses Sprint had granted for the same technology.  Both of those licenses had utilized the same royalty rate as was used in the Vonage verdict.

The court explained the damage theory as follows:  “[T]he hypothetical negotiation seeks to determine ‘what it would have been worth to the defendant, as it saw things at the time, to obtain the authority to use the patented technology, considering the benefits it would expect to receive from using the technology and the alternatives it might have pursued.’”  Id. at *15, quoting Carnegie Mellon Univ. v. Marvell Tech. Grp., Ltd., 807 F.3d 1283, 1304 (Fed. Cir. 2005).

Based on the jury’s application of this theory, the court held, at *15, that “[I]n light of all the evidence bearing on the damages award, we conclude that the jury’s verdict was supported by sufficient evidence and did not contravene the principles of apportionment set forth by this court.”