Design Patent Infringement is a Matter of Appearance and Appearances

Nike recently sued Skechers for infringement of twelve of Nike’s design patents. The Complaint convincingly establishes the similarity of the appearance of the shoes:

In addition to appearance, the Complaint also develops a convincing case on appearances, detailing Sketchers strategy of copying:

Nike explains Skecher’s practice of Skecherizing competitor’s designs:

Nike’s Complaint recognizes that while competition is legitimate, people inately believe that copying is wrong. While Skechers appears to embrace its conduct, most business work to preserve its image as a legitimate competitor, and not merely a copier. To this end, a business should pay attention to how it characterizes its own conduct. Internal project names that make the business look like a pirate, or internal communications that talk about “ripping off, “knocking off,” or even “copying,” can cast the company in a bad light to a judge or jury. If what the business is doing is legimate, there is no need to characterize the conduct as improper or inappropriate — when the issue is design patent infringement, appearances can matter just as much as appearance.

A Lesson in History, and in Particular Who Owns it

Last month, General Chuck Yeager sued Airbus for violation of right of publicity, false endorsement, and trademark infringement. The basis of his complaint? In introducing its new Racer high-speed, cost effective helicopter, Air Bus referenced General Yeager’s breaking of the sound barrier at a press conference, and then repeating the reference on line and in print. Specifically, Air Bus said:

Exhibit A to General Yeager’s Complaint

This seems little more than an innocuous reference to a historical fact. It adds some information and interest to an otherwise bland commercial statement, but it seems highly unlikely to cause anyone to believe that General Yeager is in any way connected with the Racer helicopter, let alone endorses it. Shouldn’t anyone, including a commerical entity, have the right to reference a historical event to make a point — at least if they do so in a way that doesn’t make it seem that they have the approval or endorsement of those involved in the event?

Unfortunately, the right of commercial speakers to reference historical events is not so clear. Had Air Bus been a slightly better student of history, it might of known that this is a lesson that General Yeager taught AT&T nearly a decade earlier. AT&T Mobility — then called Cingular — referenced General Yeager in an eerily similar press release:

To paraphrase George Santayana, those who don’t study history are doomed to repeat it. One might add that if you are commercial entity, even if you study history, you best not talk about it!

Social Media is Still Media

Le-Vel Brands, LLC recently sued Thrival Nutrition, LLC in the Eastern District of Texas (4:19-cv-00698-SDJ) for trademark infringement and unfair competition arising from Le-Vel’s use of THRIVE and Thrival’s use of THRIVAL

To prevail, Le-Vel will of course have to prove the there is a likelihood of confusion, but Le-Vel has help in meeting this burden from an unlikely source — Thrival’s own social media posts. As set forth in the very first paragraph of the Complain, Thrival has admitted on its Facebook page that there is confusion between the two companies:

Thrival’s Facebook posts from Paragraph I of Le-Vel’s Complaint.

While Thrival may ultimately be able to explain away these posts, the bottom line is that they are going to have to. Lured by the ease and informality of posting in social media businesses often post messages without vetting the content. The reality is that such posts are virtually permanent, and relatively easy to find, and thus the content should be vetted the same way it would review formal press releases and advertising

A business should restrict who can post on its behalf, and should have some process for vetting the content of those posts to avoid embarrassment or worse — liability.

Protect your Intellectual Property or You’ll Lose Your Shirt

It seems everyone has great idea for a t-shirt. Fortunately there are numerous ways to protect these great ideas.

Utility Patents

Although t-shirts have been around for more than 100 years, a novel and non-obvious improved t-shirt can still be protected with a utility patent. A utility patent protects the construction or function of the t-shirt and not its appearance. It typically takes just over 24 months to get a patent, and even on a simple invention like a t-shirt it can cost $7,500 or more. Utility patent protection is not for every invention, but it can provide 20 years of exclusivity for inventions that meet the three tests of utility, novelty, and non-obviousness.

U.S. Patent No. 9,215,899 protects a t-shirt with a pocket made from a necktie.

Design Patents

Design patents protect the appearance of a product, not its construction or function. The inventor of a t-shirt with a new and non-obvious appearance can protect that appearance for 15 years with a design patent. It is generally faster, easier, and less expensive to get a design patent than a utility patent, and thus can be a better option, and if the appearance is the only novel feature, it may be the only option.

U.S. Patent No. D848,119 protects the appearance of a shirt with a stripe.
U.S. Patent No. D843,686 protects the appearance of a shirt with a design
U.S. Patent No. D836,301 protects the appearance of a design around the waist of a t-shirt.
U.S. Patent No. D808,665 protects the logo of Northern Iowa applied to a t-shirt
U.S. Patent No. D773,150 protects the appearance of a tshirt that looks like a safety vest.
U.S. Patent No. D669,249 protects the appearance of a t-shirt with a necktie.

Trademarks

The words and designs on a t-shirt may function as a trademark. The owner can claim common law (unregistered) rights in these trademarks, but the rights are stronger and easier to enforce if the owner registers the trademark. Trademarks can be registered at the state or federal level. A federal registration provides nationwide protection of the mark, it allows the owner to use the ® symbol, and it makes enforcement easier and less expensive. However, it can be difficult to obtain a registration words and graphics on the exterior of the shirt, because the USPTO may regard the text or graphics as merely ornamental, and not as a trademark. Thus, some additional effort may be required to show that the mark is more than mere ornamentation.

A state registration is relatively fast, easy, and inexpensive to obtain, but it does not provide the same strong benefits of a federal trademark registration and what limited rights it does provide are limited to the borders of the state, Nevertheless, a state registration may provide some benefit where a federal registration is not an option.

Copyright

Copyright provides protection of graphics against copying, but does not protect single words or short phrases or designs that do not exhibit minimal authorship. Copyright arises automatically from the moment a the work is fixed in tangible form, but two steps will ensure the strongest possible copyright rights: First, applying copyright notice to the work. Copyright notice consists of the © symbol, the name of the copyright owner, and the year of first publication. For example for a work first published in 2018, the notice might be: © Copyright Owner 2018, even though it is no longer 2018. Second, registering the copyright with the Copyright Office. Although the copyright exists without registration, prompt registration entitles the copyright owner to statutory damages and attorneys fees.

Supreme Court Clarifies Two Small but Significant Copyright Question

Today the Supreme Court clarified two small but significant copyright issues, relying on the express words of the copyright statute in one, but deviating slightly in the other.  In Fourth Estate Public Benefit Corp. v. Wall-Street.com, LLC, [17–571] the Supreme Court held that §411 explicitly requires that a plaintiff actually have a copyright registration before bringing a copyright suit. However, in Rimini Street, Inc., v. Oracle USA, Inc., [17–1625] the Supreme Court held that the term the term “full costs” in §505 of the Copyright Act simply means the “costs” specified in the general costs statute codified at 28 U.S.C. §§1821 and 1920, and does not include a party’s other costs, in effect giving no weight to “full” in the statute.

In Fourth Estate Public Benefit Corp. v. Wall-Street.com, LLC, Fourth Estate sued for infringement of its news articles from Wall-Street’s failed to remove them from its website after canceling the parties’ license agreement. Fourth Estate had filed applications to register the articles with the Copyright Office, but the Register of Copyrights had not acted on those applications. The District Court dismissed the complaint because 17 U. S. C. §411(a) provides that “no civil action for infringement of the copyright in any United States work shall be instituted until . . . registration of the copyright claim has been made in accordance with this title.” The Eleventh Circuit affirmed, holding that registration has not been made under §411(a) until the Copyright Office actually registers the copyright.

The Supreme Court affirmed, agreeing that registration occurs, and a copyright claimant may commence an infringement suit, when the Copyright Office registers the copyright. This resolves a split in the circuits, as the Fifth, Seventh, and Ninth Circuits and a smattering of district courts held that merely filing a complete application was sufficient, while the Tenth and Eleventh Circuits, and other district courts maintained that “registration” in 17 USC §411 meant actual registration. Todays decision also does not leave copyright owners in too difficult position.  The Copyright Office has a process for expedited copyright registration (https://www.copyright.gov/help/faq/faq-special.html), and the Supreme Court reiterated that the copyright owner can still recover pre-registration damages.  At most this ruling should slow a copyright plaintiff a week or two, and cost a few hundred dollars more – barely a blip for a plaintiff heading off to federal court to enforce its rights.

In Rimini Street, Inc., v. Oracle USA, Inc., after a jury awarded Oracle damages for copyright infringement, the district court added Oracle’s fees and costs, including $12.8 million for litigation expenses such as expert witnesses, e-discovery, and jury consulting.  The Ninth Circuit affirmed the award, acknowledging that it covered expenses beyond the six categories of costs enumerated in general federal statutes authorizing district courts to award costs (28 U. S. C. §§1821 and 1920).  The Ninth Circuit explained that the additional award was appropriate because 17 U. S. C. §505 gives federal district courts discretion to award “full costs” to a party in copyright litigation. The Supreme Court reversed, holding that Sections 1821 and 1920 define what the term “costs” encompasses in subject-specific federal statutes such as §505.  The Supreme Court said that while Congress may authorize awards of expenses beyond the six categories specified in the general costs statutes, the courts may not award litigation expenses that are not specified in §§1821 and 1920 absent explicit authority. The Court said that its precedents have consistently adhered to that approach, and the Court rejected Oracles arguments that this ignored Congress’s use of “full” to modify costs in §505.

                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

Everything Old is New Again

Photographer Douglas Kirkland has sued the Kfir Moyal Art Gallery Inc., in the Southern District of Florida (1:19-cv-20293-DPG), alleging that the Gallery copied and distributed Kirkland’ copyrighted Work for purposes of advertising and promoting Kfir Moyal’s business, and in the course and scope of advertising and selling products and services.

The courts have been accommodative of artists who use preexisting images in their work, as long as the use is “transformative.” The question is whether Kfir Moyal’s image on the left is in fact transformative of Kirkland’s 1965 photo of Brigitte Bardot on the right.

Is the image on the left transformative of Kirkland’v 1965 photo of Brigitte Bardot?

Kirkland’s lawyers are cleverly focus the Complaint not on the artistry of the Kfir Moyal’s image, but on its commercial use in advertising and promotion, hoping to avoid favorable treatment many courts give purely artistic works. It remains to be seen if this strategy is successful.

Advertising Doesn’t Cost, It Pays (Unless You’re Not Careful)

Advertising, press releases, and even product packaging all communicate the company’s value proposition to the consuming public, but occasionally they can do more harm than good. These items are a direct reflection on the company and its products and services, and need to be carefully vetted. This is more than just careful proofreading, but fully vetting the content to reduce the risk of embarrassment and even legal problems.

Here is a checklist of things go consider when reviewing advertising, press releases, and product packaging :

Ownership

  • Did we create or obtain the right to use all of the text?
  • Did we create or obtain the right to use all of the images?
  • List all third party material used (including third party material we believe we acquired):
    • Do we have written permission to use the third party material, or has a Company lawyer concluded that the use is appropriate?

Publicity/Privacy

  • List each person identified, mentioned, or depicted.
    • Do we have written permission/release to identify, mention, or depict this person?
  • Does it appear that any person or entity is providing a testimonial or expressly or impliedly endorsing our products or services?
    • Do we have written permission/release to present this testimonial/endorsement?
    • Is the testimonial/endorsement accurate and fair?
    • If the testimonial/endorsement paid, is that fact disclosed?
  • Is there any reason to believe that the person identified, mentioned, or depicted could be controversial or divisive, or otherwise impair our image or that of our products and services?

Content

  •  Is the use of all unqualified superlatives necessary and justified?  (E.g., maximum, highest, lowest, critical, essential, important)
  • Is the use of all absolute terms necessary and justified? (E.g., -free, -proof)
  • Is the use of all terms necessary and justified? (E.g., -free, -proof)
  • Are claims regarding “free” (i.e., no-cost) accurate?
  • Are there any claims regarding safety?
    • Are they necessary?
    • Are they accurate?
  • Are any claims regarding improved truthful?
  • Have claims of improvement been vetted with legal (e.g. subsequent repair)?
  • Are claims regarding place of manufacture (e.g. “made in USA”) accurate?
  • If there are specific claims about our products or services (e.g. rankings or numerical data), are they accurate, provable, and documented?
  • If there are comparisons with third party products, are they accurate, provable, and documented?
  • If there are references to third parties or third party products, do we have express/implied permission, or are they otherwise legally justifiable?
    • Are all such references accurate, provable, and documented?
    • Are all such references not disparaging?

Our IP

  • TRADEMARKS
    • Existing Marks
      • List all existing marks used.
      • Are our existing trademarks used correctly?
        • Used as an adjective?
        • Presented correctly (in compliance with existing usage guidelines) and consistently?
        • Identified with a TM, SM, or ®?
        • Displayed Distinctively?
      • New Marks
        • List all existing marks used.
        • Have our new marks been cleared?
        • Have we applied to register our new marks?
        • Are our new trademarks used correctly?
          • Used as an adjective?
          • Presented correctly and consistently?
          • Identified with a TM, SM, or ®?
          • Displayed Distinctively?
  • Copyright Generally, press releases do not bear copyright notice as copying is to be encouraged.  However, packaging and advertising can and should be copyrighted.
  • Trade Secrets
    • Are any of our trade secrets or confidential information mentioned?
      • Should they be?
    • Are any third party trade secrets or confidential information mentioned?
      • Should they be?
  • Inventions/Patents
    • Are any of our inventions mentioned?
    • Has a patent application been filed?
      • Should the invention be mentioned/disclosed at this time?
    • Are any third party inventions mentioned?
      • Should the invention be mentioned/disclosed at this time?

Third Party IP

  • Trademarks
    • List all third-party marks used.
    • Are all third party trademarks use truthfully?
    • Are the third party trademarks used correctly?
      • Used as an adjective?
      • Presented correctly and consistently?
      • Identified with a TM, SM, or ®?
      • Displayed Distinctively?
    • Do we identify correct owner of mark or at least disclaim we are the owner of the mark?
  • Patents
    • Do we describe our products or services in a way that might indicate they are covered by a third party patent?
    • Do we make any claim about our product or service that might indicate they are covered by a third party patent?
  • Copyrights
    • Do we have written permission to use third party works (text, images)?
    • Do we use correct copyright notice?
  • Trade Secrets
    • Are we disclosing any third party confidential information?
    • Do we have written permission to do so? 

Disclaimers/Explanations

  • Are any disclaimers or explanations needed?  For example, related to: third party uses, claims or statements made about the product, guarantees or warranties made, depictions of the product or service.

IP New Year’s Resolution

Its the start of a new year, and here are ten things that you should consider to enhance your intellectual property in 2019:

  1. Revisit your employee agreement to ensure that the Company’s IP is adequately protected.
  2. Update your invention disclosure form. Even though we are operating in a first to file system, record keeping is still important to be able to prove/disprove derivation. Make sure that your forms are up to date.
  3. Take secrecy serious. Trade secret protection depends upon whether steps, reasonable under the circumstances, have been taken to protect the secrecy of the subject matter,
  4. Track agreements more closely. Do you know when the confidentiality and license agreements you have entered expire? Do you a process to ensure performance of these agreements?
  5. Evaluate inventions disclosures more critically. Not all inventions need protection — for example inventions that solve problems unique to your product are unlikely to be infringed by third parties.
  6. Take copyright seriously. Copyright provides wide ranging protection for advertising, packaging, websites, and other works of authorship. These rights are enhanced by the application of proper copyright notice, and prompt registration of the works.
  7. Make employee education a priority. Your employees are critical to protecting your intellectual property, and avoiding the intellectual property of others.
  8. Create a brand guide. Establish clear rules for the proper presentation and use of your trademarks. Publish these rules so that everyone inside the company, and outside the company uses your marks correctly.
  9. Create a social media policy. There are a surprising number of ways things can go wrong on social media, and some simple rules can prevent this from happening.
  10. E-mail better. Make sure your emails don’t put you and your activities in an unfairly light if they are viewed by outsiders.

Employee Agreements Revisited

This is a great time of year to revisit your employee agreements and update them if necessary. Changes to employee agreements generally must be supported by consideration, and end of year bonuses, salary adjustments, and promotions provide consideration to allow the employer to amend the agreement with existing employees.

In reviewing your employee agreement, considering the following:

Confidentiality

No disclosure or use of CONFIDENTIAL INFORMATION

Return of Company property and CONFIDENTIAL INFORMATION upon

Authorize contact with subsequent employers

Access to Company Computers Systems and Data

Inventions

Prompt and full disclosure of (a) inventions and discoveries, (b) copyrightable works

Proper record keeping

Treatment of prior inventions

Agreement to assign coupled with current assignment

Authorization of company to file patent applications and execute documents if employee is unable or unwilling to do so.

Agreement to cooperate/assist

No challenge to Company IP

Proper record keeping

Treatment of prior inventions

Agreement to assign and current assignment

Agreement to cooperate/assist and execute additional documents

Authorization of company to file patent applications and execute documents if employee is unable or unwilling to do so.

No challenge to Company IP

Treatment of prior inventions

Employee Conduct

□ Non-solicitation

Non-compete

Non-disparagement

Representations and Warranties: (a) freedom to enter Agreement and fully perform; (b) no undisclosed conflicting obligations; (c) no breach of prior obligations; (d) no knowingly use third party IP

Standard Provisions

Not an employment agreement/employee at will

Not an employment agreement/employee at will

Severability

Non-Waiver

Breach by employer not a defense to or prerequisite to performance

Choice of laws

Choice of forum

Integration

Modification

Acknowledge read and understood agreement

Further acts and assurances

Successors and assigns

Remedies

Consent to injunctive relief

Adequate consideration

Voluntary execution

Opportunity to consult counsel

Counterparts