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Suzanna M. M. Morales

One of the important benefits of United States trademark and copyright registration is the ability to seek the assistance of Customs and Border Protection (“CBP”) to prevent counterfeits from coming into the U.S. However, these protections are not automatic. This article discusses how intellectual property owners can take advantage of these protections.

Recording a copyright or trademark registration with CBP

Once a trademark or copyright registration certificate is issued by the U.S. Patent and Trademark Office or Copyright Office, the owner may record the registrations with CBP for monitoring and seizure of potentially counterfeit products. At the time of this article, the CBP filing fee is $190 for each class of goods covered by a trademark registration and $190 for each copyright registration. Once the registration is recorded, CBP contacts intellectual property owners or their designated representative for assistance when differentiating between counterfeits and genuine goods.

Recordation of a trademark registration lasts ten years. In contrast, recordation of a copyright registration lasts twenty years, unless the underlying copyright registration expires during that time. Recordation renewal for an unexpired recordation costs $80 for each class of goods covered by a trademark, and $80 for a copyright registration.

Other ways to work with the CBP

Along with recording its registrations, an intellectual property owner can improve the effectiveness of enforcement efforts by educating the CBP on genuine goods. For example, information about where genuine goods are manufactured, the location and identity of any authorized manufacturers/distributors/users of the mark, and the country of manufacture of suspected counterfeits, if known, should be provided to CBP.

1. Product Guide and Presentation to CBP

In addition to recording its registrations, an intellectual property owner can further educate CBP by submitting a product guide and providing information, sometimes in the form of a presentation to CBP on the owner’s goods. A product guide provides an overview of the company’s products and intellectual property, and is helpful in alerting CBP to the ways in which counterfeit products may be identified. The product guide is entered into CBP’s database and is available at all U.S. ports. An in-person presentation allows a company a further, fuller opportunity to interact with CBP.

1. e-allegations

Finally, CBP also has an online “e-allegations” form that anyone, including the public and rights holders, can use to submit specific allegations of infringing shipments and other trade violations. This information is provided to the appropriate office of CBP for investigation. Although the e-allegations system may be a convenient channel to address specific infringement, please note that CBP does not communicate with the initiator of an e-allegation in most cases about the status of the matter due to privacy and trade secret laws. This enforcement tactic should be combined with building relationships with appropriate agencies and as an adjunct to the right holder’s own ability to help itself by seeking judicial intervention including injunctive relief.

Please let us know if you would like to discuss these measures to protect your company’s brand.

Standing in Trademark Trial and Appeal Board Cases

By Suzanna M. M. Morales

In order to successfully challenge a trademark registration before the U.S. Patent and Trademark Office’s Trademark Trial and Appeal Board, a party must first meet a threshold requirement that it has standing to oppose or petition to cancel the registration. Although the standing requirement is a relatively low hurdle, a recent decision shows that the requirement does have limits.

What is standing?

The Trademark Trial and Appeal Board (TTAB) decides oppositions to pending applications as well as petitions to cancel existing registrations. Before the TTAB reaches the substantive merits of the matter, an opposer or petitioner to cancel must demonstrate standing, which is defined as a “real interest” in the proceeding and a “reasonable basis for its belief of damage.” The “real interest” requires a “direct and personal stake” in the outcome of the proceeding. The plaintiff must have a “legitimate personal interest in the opposition,” though, importantly, the interest does not need to be greater than the interest of the general public.

Which brings us to goats…

Standing is generally not a difficult requirement to meet. But the U.S. Court of Appeals for the Federal Circuit denied standing to a would-be petitioner to cancel in Bank v. Al Johnson’s Swedish Restaurant & Butik, Inc., Case No. 2019-1880 (Fed. Cir. Dec. 9, 2019).

The registration at issue covered trade dress that the owner described in the records of the USPTO as “goats on a roof of grass” used in connection with restaurant services:

On October 12, 2018, Todd C. Bank, an individual, filed a petition to cancel the registration on the basis that the mark did not function as a trademark. In support, Bank claimed that the goat roof trade dress served the useful purpose of removing or reducing the restaurant owner’s need to mow the grass roof. Bank’s petition to cancel further claimed that the mark “is demeaning to” goats, which in turn was “offensive” to him and “denigrates” the value he places “on the respect, dignity, and worth of animals.”

However, a 2017 Supreme Court decision found unconstitutional the clause of the U.S. trademark law barring the registration of marks on the basis that they are disparaging to any person. Matal v. Tam, 137 S.Ct. 1744 (2017). The Federal Circuit in the Bank matter held that the disparagement clause was the only basis for Bank’s standing, and was no longer valid following the Tam decision. (Presumably, the disparagement clause as applied to goats was a novel issue, but the Federal Circuit did not address this question.)

Moreover, the Trademark Trial and Appeal Board held that the only viable claim in Bank’s opposition was that the goat roof trade dress was functional and the claim of standing based upon the disparaging nature of the goat roof trade dress did not apply to the functionality claim.

Finally, it should also be noted that Bank appeared as an attorney on behalf of another individual who challenged the same registration in 2011. Standing in that case was based upon the petitioner’s desire to take photographs of goats upon roofs, and the petition was later amended to allege, among other claims, that the petitioner “enjoys the look and smell of grass roofs.” The TTAB found that the petitioner did not have standing for either the original petition or the amended petition.

…and fairy tales

In contrast, a 2018 TTAB decision held that standing did exist for an opposer whose basis for standing was merely as a consumer. Curtin v. United Trademark Holdings, Inc., Opposition No. 91241083 (TTAB Dec. 28, 2018). In the RAPUNZEL case, the opposer alleged that she was a consumer in the marketplace for dolls and toy figures of fairy tales, as well as the mother of a young girl who purchases dolls, including fairy tale dolls. She claimed that registration of the mark RAPUNZEL for dolls would decrease the competition and increase the cost of goods associated with the character Rapunzel. (The opposer also happened to be a professor of trademark law, and was represented by a student legal clinic.)

The Board and the Federal Circuit have found that even challengers who were merely consumers may have an interest in preventing the owner of a mark from inhibiting competition and “maintain[ing] freedom of the public to use the language involved.”

Conclusion

Most oppositions and petitions to cancel are filed by competitors in the marketplace, and allege that the marks at issue cause a likelihood of confusion with the opposer’s or petitioner’s trademarks. However, the aforementioned cases are a reminder that, under certain circumstances, others may have legitimate interests in challenging registrations.

By Matthew F. Abbott
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Recently, bipartisan legislation has advanced through Congress that would create a tribunal within the Copyright Office to address copyright claims that do not exceed $30,000 in value. There is nearly universal agreement that a small claims adjudication process is needed to address the inequities in the enforcement of copyrights for independent creators for whom litigation is prohibitively expensive. However, the specifics put forth in the legislation have also raised concerns as to how effective and susceptible to abuse this process will be.

The Copyright Alternative in Small-Claims Enforcement (CASE) Act

The CASE Act calls for creation of a “Copyright Claims Board” (CCB) within the Copyright Office, which consists of three “Copyright Claims Officers” who are assisted by several “Copyright Claims Attorneys.” Copyright Claims Officers would serve for a term of six years and adjudicate copyright claims, counterclaims and defenses brought before the CCB. Proceedings are to be conducted at the CCB’s Washington, D.C. offices and take place through “written submissions, hearings and conferences carried out through internet-based applications and other telecommunications facilities.”

Some important features of the CCB process include:

Permissible Claims: The CCB may adjudicate infringement claims and counterclaims under 17 U.S.C. § 106, as well as claims under 17 U.S.C. § 512(f) for misrepresentation in connection with a DMCA notice. The CCB may also adjudicate any legal or equitable defense available at law. Parties to a proceeding may be, but are not required to be, represented by counsel. A party may not recover more than $30,000 in any one CCB proceeding, exclusive of attorney’s fees and costs. The Act provides that separate regulations may be established by the Register for claims in which damages do not exceed $5,000, and may be considered by a single Copyright Claims Officer.

Registration Requirement: A claim may not be asserted before the CCB unless an application for registration, deposit and filing fee have been submitted to the Copyright Office. However, the CCB may not render a determination in a proceeding until a registration certificate has been issued by the Copyright Office. If a registration is denied, the proceeding shall be dismissed without prejudice. The bill directs the Register to establish regulations allowing the Copyright Office to expedite the registration of an unregistered work that is before the CCB.

Voluntary Participation/Opt-Out: Following service of a Notice and Claim, a respondent can opt out of the proceeding within sixty days. If a respondent timely opts out, the proceeding is dismissed without prejudice and the claimant may choose to file the claim in a federal district court. If a respondent does not opt out within sixty days, the proceeding is deemed active and the respondent will be bound by a determination.

Permissible Remedies: The CCB may award actual damages and profits under 17 U.S.C. § 504(b). Additionally, the CCB may award statutory damages under § 504(c) as follows: (1) For works with an effective date of registration within three months of the date of publication under 17 U.S.C § 412, statutory damages may not exceed $15,000 per work; (2) for works not timely registered under § 412, statutory damages may not exceed $7,500 per work or a total of $15,000 in any one proceeding. The CCB may not consider an infringer’s willfulness in awarding statutory damages, but may consider whether the infringer has agreed to cease or mitigate the infringing activity. Additionally, the CCB may include a requirement to cease conduct if the infringing party agrees to stop infringing activity or cease sending misrepresentative DMCA notices or counter-notices.

Attorney’s fees: Attorney’s fees are only available upon a determination that a party pursued a claim or defense for harassing or other improper purpose or without reasonable basis in law or fact. An award of attorney’s fees and costs may not exceed $5,000 except in “extraordinary circumstances” showing a “pattern or practice of bad faith conduct.” Additionally, if a party is found to have pursued a claim or defense for harassing or other improper purpose or without reasonable basis in law or fact more than once in any twelve-month period, that party is barred from bringing a claim before the CCB for twelve months.

Reconsideration: A party may request that the CCB reconsider a determination based on clear error of law or material fact, or a technical mistake. If the CCB denies a request for reconsideration, a party may request review of the final determination by the Register of Copyrights. This review is limited to consideration of whether the CCB abused its discretion in denying reconsideration.

Enforcing A Determination: Where a party fails to pay damages or otherwise comply with relief, the claimant may, within one year of final disposition of the proceeding, apply to the U.S. District Court for the District of Columbia or “any other appropriate district court” for an order confirming the relief rewarded and reducing the relief to judgment. If the district court grants the order and enters judgment, the party who failed to pay damages must pay reasonable attorney’s fees and expenses incurred in obtaining the judgment.

Criticism of the CASE Act

Although the CASE Act is supported by a variety of sources, including industry associations, corporate copyright owners and artist advocacy organizations, it has also been criticized.

The legislation has been criticized on the basis that the opt-out procedure may result in respondents routinely opting out if they believe that a claimant can’t afford to litigate in federal court, thereby forcing the claimant to file in federal court or drop the claim. Reliance on the opt-out procedure may act as a deterrent to the filing of CCB claims by copyright owners with limited resources.

The CASE Act has also been criticized on the basis that it will empower “copyright trolls” seeking quick settlements based on the threat of statutory damages of up to $15,000 and emboldened by the fact that claims may be filed even without an issued copyright registration. Additionally, critics have charged that due process issues will arise where a respondent’s failure to opt out effectively waives his right to a jury trial and binds him to the determination of a Copyright Claims Officer, which is not appealable to any Article III court.

Currently the CASE Act has passed the House and awaits a full vote in the Senate. Given its bipartisan support, it seems likely that the CASE Act will eventually become law. Copyright owners whose claims fall within the jurisdiction of the CCB should consider it as a quicker and less expensive alternative to litigating in federal court. It remains to be seen whether the criticisms of the CCB will be borne out.

Patrick B. Monahan

Introduction

In February of 2019, the U.S. Copyright Office introduced a new option for group registration of up to ten (10) unpublished works for a single application fee, which is currently $55.00. This is purely an administrative classification, and each work in a group registered using this option will be registered with the Copyright Office as though they were applied for individually. Photographers, please take note that this option does not replace the procedure currently in place for registering up to 750 unpublished photographs on the same application and for a single filing fee.

Are My Works Unpublished?

The Copyright Act, 17 U.S.C. § 101, defines “publication” as:

the distribution of copies or phonorecords of a work to the public by sale or other transfer of ownership, or by rental, lease, or lending. The offering to distribute copies or phonorecords to a group of persons for purposes of further distribution, public performance, or public display, constitutes publication. A public performance or display of a work does not of itself constitute publication.

Generally speaking, for copyright purposes, “publication” consists of offering a work for sale or widespread distribution. Examples of publication include, but are not limited to, selling prints of a painting or copies of a novel or musical recording. If you have questions about whether or not one of your works has been published, feel free to contact us.

Application Requirements

In order to take advantage of this group filing procedure, in addition to ensuring none of the works have been published, applicants must make sure that the following requirements are met:

• All works must be of the same type (Literary Work, Work of the Visual Arts, Sound Recording, Work of the Performing Arts, Motion Picture/AV Work)
• All works must have been completed in the same year;
• The author and claimant of each work must be the same;
• The applicant must provide a title for each work (though all works will be covered as if they had been registered on an individual basis, if there is a particular title you would prefer to have visible to the public, please note that in the Copyright Office’s public catalog, only the first title will be shown, (e.g., “Title 1 and 9 other unpublished works”)); and
• Applicants must submit deposits, i.e., copies of the works, in a format specified by the Copyright Office depending upon the type and nature of works.

If you have any questions about this filing procedure, or any other questions about protecting your copyrights, please do not hesitate to contact us.

We are pleased to report on two recent victories before the Trademark Trial and Appeal Board (“TTAB”) of the U.S. Patent and Trademark Office on behalf of Powley & Gibson clients.

The TTAB recently issued a decision in a joint cancellation and opposition proceeding finding that the mark HAMPTONS GLOW and Design was likely to cause confusion with S&G Hampton Sun, LLC’s registered HAMPTON SUN trademarks.  As a result, S&G Hampton Sun’s request to cancel the HAMPTONS GLOW and Design registration and to sustain S&G Hampton Sun’s opposition to an additional pending application for the HAMPTONS GLOW and Design mark was granted by the TTAB.  S&G Hampton Sun, LLC was represented in this matter by Robert L. Powley, Keith E. Sharkin and David A. Jones.

In another decision, the TTAB found in favor of Lupin Pharmaceuticals Inc., the owner of the registered trademark LUPIN. The TTAB held that the Applicant’s mark LUPPIN for education and support group services relating to the disease Lupus was likely to cause confusion with Lupin’s house mark LUPIN for pharmaceutical preparations. In view of the similarity of the parties’ respective marks and the close relatedness of the parties’ goods and services, the TTAB refused registration of the mark LUPPIN. Robert L. Powley, Thomas H. Curtin, and Suzanna M. M. Morales represented Lupin in this matter.

Our firm has extensive experience in litigating inter partes proceedings before the TTAB, including oppositions and cancellations. If you have any questions about TTAB matters, please contact our firm.

(Attorney advertising. Prior results do not guarantee a similar outcome.)