When choosing a new trademark or service mark, you need to be generally concerned with two things: (1) whether the new mark could be considered descriptive of the product or service it is intended for (i.e. descriptiveness); and (2) whether there are any trademarks or service marks in the marketplace so similar to the intended mark that consumers could be confused as to the source or origin of the goods or services (i.e. likelihood of confusion).  While these considerations are critical, there are some other considerations that could also prevent registration of a new mark.  For instance, what if the mark was not descriptive of the actual product or service it is intended for but descriptive of something else that the product or service lacks?  In some cases, these ‘misdescriptions’ could be problematic and may even lead to a determination that the mark cannot be registered on the basis that it is deceptive under Section 2(a) of the Trademark Act.[1]

In a recent decision, the Trademark Trial and Appeal Board upheld a refusal to register the mark “P6 CHROME” for “dietary and nutritional supplements that do not contain chromium” in Class 5 (In re Woodbolt Distribution, LLC 2018 WL 1981349 (T.T.A.B. 2018)).  The Board agreed with the Examining Attorney’s conclusion that the mark “misdescribes the goods as containing chromium, a substance some doctors say has health benefits” and confirmed the refusal to register under Section 2(a) of the Trademark Act.  Despite arguing that the term “chrome” had multiple meanings not associated with chromium, per se, and that the term was intended to refer to the product’s metallic packaging, the Board determined that the presence of the term “chrome” would create consumer confusion and falsely suggest that the supplement contained chromium when, in fact, it did not.

The Board considered several factors, including dictionary definitions of the term “chrome,” the use of the term “chrome” (and variations thereof) in the marketplace for dietary supplements, whether consumers shopping for dietary supplements would believe that a product called P6 CHROME would contain chromium and finally, whether the misdescription would make the product more desirable to consumers.  The Board determined that (i) the common definition of “chrome” can mean chromium; (ii) other competitors in the marketplace used the term “chrome” (or variations thereof) to market dietary supplements containing chromium (e.g. CHROME MATE, ULTRACHROME 500, AQUA CHROME); (iii) consumers were likely to believe a product called P6 CHROME contained chromium; and (iv) the suggestion that the product contained chromium did make the product more desirable to consumers of dietary supplements.  The Board affirmed the refusal to register the mark P6 CHROME as deceptive under Section 2(a) of the Trademark Act.

Rejection on this basis is not common, but it is something that should be considered when contemplating a new mark.  Look to your market – does the mark describe something consumers may want and expect the product (or service) to contain which it does not?  If so, you may be inviting a deceptiveness challenge down the road.  The resources spent trying to register a potentially deceptive mark may be better spent in selecting and developing a better, stronger mark.  The time and resources lost in trying to argue around a deceptiveness objection is time lost building good will and market awareness for your brand if, ultimately, you must give up on a deceptive mark and choose an alternate brand.  Relying on the expert guidance of a trademark attorney could prevent such an outcome.  A good trademark attorney can help you avoid pitfalls at the early stages of the selecting and identifying a brand, saving your company resources and time, and allowing you to concentrate on building a strong brand from the outset.

[1] Section 2 of the Trademark Act states, in part, “No trademark by which the goods of the applicant may be distinguished from the goods of others shall be refused registration on the principal register on account of its nature unless it—

(a) Consists of or comprises immoral, deceptive, or scandalous matter…”

In today’s digital world, it is easier than ever to copy a third party’s work that is covered by copyright. The term “fair use” is often used to justify the use of such copyrighted materials without the owner’s consent, but what does “fair use” really mean?

Fair use is an affirmative defense to copyright infringement. That means that even if an alleged infringer is found to have copied the copyright owner’s work, using the work fairly, the alleged infringer will not be liable for infringement. It is the alleged infringer’s burden to prove fair use. However, it is difficult to determine whether there is fair use in any particular instance, and prior court rulings provide little guidance because each case is considered on its own unique facts.

This article discusses the current meaning of fair use as that doctrine evolves under U.S. copyright law, and why it is not so easy to pin down.

Under the U.S. copyright statute (17 U.S.C. § 107), a court will consider four factors to determine whether a use of copyrighted material constitutes “fair use”:

• (1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purpose

Here, one important consideration is whether the use is “transformative,” i.e., that the new use “communicates something new and different from the original or expands its utility.” (This language is from the influential Second Circuit Court of Appeals in Authors Guild v. Google, Inc., 804 F.3d 202 (2d Cir. 2015)). In order to be “transformative,” the use must “do something more than repackage or republish the original copyrighted work.” For instance, a user cannot simply re-post the copyrighted work of another in its entirety, no matter what the purpose, if it is to be transformative.

In addition, this factor specifically directs the court to consider whether the purpose is commercial. However, just because a for-profit entity uses the material, that does not end the inquiry. The court will take a closer look at the actual purpose of the copying, no matter what the status of the copier.

• (2) the nature of the copyrighted work

This factor is often considered in comparison with the purpose of the use of the work. One famous example is the Supreme Court’s holding that 2 Live Crew’s off-color interpretation of the song “Pretty Woman,” appropriating the signature opening riff of the famous Roy Orbison song, was a parody of the original, and was used fairly.

There is some indication that the courts will consider the copying of heavily fact-based works to be more likely to constitute fair use because the underlying factual information itself is not copyrightable, but other courts have discounted this, considering the creativity involved in incorporating and presenting those facts in a finished work.

In any event, this factor is generally not significant to the overall consideration of fair use.

• (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole

Here, the court will consider the amount of the copyrighted work made available to the public, rather than the amount used by the alleged copier. Rather than being a simple equation of the percentage of copying, the court will consider whether the material copied is at the heart of the copyrighted work. For example, the Supreme Court held that excerpts of a few hundred words from the book – a highly-anticipated memoir of former President Gerald Ford – was a substantial portion of the work. Harper & Row, Publrs. v. Nation Enters., 471 U.S. 539 (1985).

• (4) the effect of the use upon the potential market for or value of the copyrighted work

The U.S. Supreme Court has held that this is the most important factor. Harper & Row, 471 U.S.  at 566. This factor considers whether the claimed infringer’s use is a competing substitute for the original which would deprive the copyright owner of significant revenues. This factor considers not only the potential effect on the market for the copyrighted work of the claimed infringer, but also the effect of widespread use of the work in a similar manner. Here, the court will consider whether an unlimited number of others using the copyrighted work in the same way would impact the copyright owner’s market for its work.

However, a type of use that is completely unlikely to become a part of the normal market for the original work is more likely to be considered to be fair use than a market that the copyright owner would be likely to exploit.

*                                  *                                  *

It is not possible to generalize instances that may be considered fair use, because courts consider the facts of each case on a case-by-case basis, considering not only these, but also any other relevant factors. Fair use is not a black-and-white, binary consideration, but will depend on the specific factors of each case. A main theme of the fair use consideration is whether the copying would usurp the market and supplant the original. And as new technologies and ways to copy continue to develop, the law will continue to evolve.

Fritz Klantschi

If you have applied to register a patent in the United States, you also may be interested in filing applications outside the U.S. There are two methods to file a patent application in a foreign country based on an U.S. patent application, (1) Direct filing, and (2) Patent Cooperation Treaty (PCT) filing.  Either method must be initiated within 12 months of the earliest U.S. filing date to ensure the foreign patent application(s) is afforded the priority date of the originally-filed application.

Direct Filing

With direct filing, the patent application is filed directly with the patent office of the selected foreign country(ies) or region(s).  The examination process is generally very similar to that of the U.S.  However, there may be differences in what is patentable and the standard for patentability.  Formal matters, such as translations of the patent application, may be required for certain countries.  Several countries allow for deferred examination.  For example, examination of a Canadian patent application will not start until the applicant requests it.  The request must be made within 5 years of the International Filing Date.  Deferred examination can serve to reduce and defer cost of examination in Canada by awaiting the outcome of examinations in other jurisdictions.  Unlike the U.S., many countries require periodic fees called annuities to be paid to maintain pendency of the patent application.

Europe has for decades examined patent applications at the regional level by the European Patent Office (EPO) and when allowed, the patentee validates the patent in particular European countries chosen by the applicant by paying grant fees and submitting translations.  The European Union (EU) negotiated the creation of a European patent with unitary effect (“unitary patent”) and a unified European patent court.  The European unitary patent will provide protection for inventions in 25 countries across Europe.

Patent Cooperation Treaty (PCT)

A PCT patent application allows a company to delay filing a patent application directly with a foreign country.  A PCT application has two phases, an international phase and a regional/national phase.  The international phase extends generally for 30 months (31 months in Europe and Australia) from the priority date of the corresponding U.S. application.  During the international phase, an International Searching Authority conducts and issues a Search Report of relevant prior art and a Written Opinion as to the patentability of the pending claims.  Generally, no substantive action is required by the applicant during the international phase.  Both the Search Report and the Written Opinion are consultative documents.  An applicant is provided an opportunity to respond to the Written Opinion, but is not required to do so.  At the 30-month date, for most PCT member countries, the applicant must enter the national or regional phase of the PCT.  Entry into the national phase requires the applicant to file national or regional (such as Europe) applications in selected PCT member countries.  The national phase filing(s) is similar to a direct filing discussed above.

Filing a PCT patent application allows the company time to make strategic decisions as to which countries to seek patent protection.  It also provides the company with preliminary feedback as to the patentability of the filed claims and identifies relevant prior art.  The delay also postpones the cost of filing the application in multiple countries and provides an opportunity for the company to determine what, if any, value the patent may have.  Furthermore, the delay allows time for the parent U.S. application to begin the USPTO prosecution process

Some disadvantages of the PCT route are that the total costs are higher and that it will take longer for the application to mature into a patent in the individual countries.

Fritz Klantschi

This is the third of four articles discussing the basics of filing a U.S. patent. The interaction between the patent applicant and the USPTO regarding the patentability of the application’s claims is referred to as patent prosecution and continues until either the applicant abandons the application or the USPTO declares the claims as patentable and issues a Notice of Allowance.

Upon receipt, the USPTO checks to ensure the filed non-provisional patent application is complete (appropriate fees paid, formalities review – determine if a specification, drawings, claims and oath/declaration are filed and conform to USPTO standards).  If complete, an Official Filing Receipt is issued which identifies the application number, filing date, and other relevant information.  The patent application is assigned to the appropriate technology group and is examined in the order it is received.  Because of the backlog at the USPTO, it may be one or two years before there is any substantive examination of the patent application.  At 18 months from the earliest filing date, the patent application is generally published.  If an applicant decides not to seek patent protection in foreign countries, the applicant can elect that the patent application not be published until the patent is granted.  A benefit of not having a patent application published is that others cannot review the patent application or the prosecution history until and only if the application matures into a patent.  A drawback to not publishing a patent application is that a patent holder may not seek damages for infringement prior to a patent being issued.  In certain situations, a patent holder may be awarded damages for infringement occurring prior to an application maturing as a patent when the published claims remain substantially unchanged and mature into a patent.

Review of the Application

Once an Examiner is assigned and has reviewed the contents of the application for all U.S. legal requirements, the Examiner will determine if the application is claiming more than one invention.  If more than one invention is claimed, the Examiner will issue a restriction requirement requiring the applicant to elect the invention to be examined.  If only one invention is claimed, or the applicant has elected one invention to examine (prosecute), the Examiner conducts a prior art search and generally issues a first Office Action.  In the examination phase, the initial burden is on the examiner since an applicant is entitled to a patent unless the requirements of U.S. law are not met.  A patent examiner will read and understand the invention as defined by the specification and drawings; determine whether the application is adequate to define the boundaries of the claimed invention; determine the scope of the claims; perform searches of existing technology (both patent and non-patent literature); and determine the patentability of the claimed invention.

In the first Office Action, the Examiner will identify if the invention is not adequately described and enabled, the claimed invention is not described in clear and definite terms, and whether the drawings comply with USPTO standards.  The Examiner will also identify if any claims contain patentable subject matter and identify any rejected claims and provide a basis for the rejection.  Claims are generally rejected as lacking novelty (where no aspect of the invention is new such that every element of the claimed invention is disclosed in a single prior art reference) or as obvious in view of the cited prior art. (An invention is obvious if the differences between the claimed invention and the prior art is such that the claimed subject matter as a whole would have been obvious to one of ordinary skill at the time the patent application was filed.)

An Examiner may also reject one or more claims for being directed to non-eligible patent subject matter (laws of nature, natural phenomena and abstract ideas – these terms include scientific principles, natural occurring phenomena, mental processes, and mathematical algorithms).  If the Examiner objects to the drawings or specification or has rejected one or more claims, the Examiner issues an Office Action. Typically, a response to an Office Action is due within 3 months of the mailing of the Office Action.  Time to submit a response can be extended with payment of the appropriate governmental fees to six months from the mailing of the Office Action.

Responding to an Office Action

Preparing a response to an Office Action includes an analysis of the grounds for rejection and the cited prior art.  The response may include claim amendments and arguments responding to each rejection of an independent claim.  It is important to consider whether the claims and arguments are consistent with the applicant’s objectives for the critical features of the invention seeking protection. Once a response is filed, the Examiner reviews the response, conducts a subsequent search and either agrees with the claim amendments and arguments presented with regards to patentability and issues a Notice of Allowance, or disagrees with the Applicant’s response and issues a Final Office Action.

If a Final Office Action is issued, a subsequent response is required to address the claim rejections.  If claim amendments are made in a response to a Final Office Action, the Examiner is likely to issue an Advisory Action stating the response will not be entered because the proposed amendments raise new issues that require further search, raise issue of new matter, are not deemed to place the application in better form for appeal, or present additional claims without cancelling a corresponding number of finally rejected claims.

A Request for Continued Examination (RCE) filed by the Applicant in response to an Advisory Action re-opens prosecution and the earlier-filed response to the Final Office Action is entered.  The RCE allows for continuing examination of the patent application.

An alternate approach to responding to a Final Office Action and/or an Advisory Action is to initiate an appeal process.

Notice of Allowance

A Notice of Allowance is issued when the examiner determines that the patent application is complete and meets all statutory requirements, including that all pending claims are deemed patentable in view of the prior art.  The applicant is required to pay an Issue Fee and ensure all formalities are completed, such as filing of an Oath and Declaration.  After the issue fee is paid, it may take another month or two before the USPTO issues a patent.  Prior to the issuance of the patent, an applicant has the opportunity to file continuation or divisional patent applications, claiming priority back to the originally-filed application.

It may take two or more years from the date the non-provisional application is filed to obtain a patent.  Statistics show that the average pendency for utility patent applications is 33 months as of November 2016.  This is dependent on the technology area of the patent application.  Generally, biotechnology and organic chemistry patent applications have a total pendency of two years, while mechanical engineering products have the longest pendency.  However, once a patent application (either a provisional or non-provisional patent application) has been filed, the applicant can claim “patent pending” with respect to their invention/product.

Term of the Patent

The term of a patent is 20 years from the date of the earliest filing.  Once a patent issues, the patent holder can enforce his rights and prevent others from manufacturing, importing, selling or offering for sale the patented technology without first obtaining a license from the patent holder.  The scope of the patented invention or the extent of protection is defined by the claims of the granted patent.  The patent holder must pay maintenance fees at 3.5, 7.5 and 11.5 years after the patent issues, to maintain the patent.

No infringement action may be started until the patent is issued. However, pre-grant protection is available which allows a patent owner to obtain reasonable royalty damages – the amount the infringer would have paid for a license- for certain infringing activities that occurred before the patent’s date of issuance. This right to obtain provisional damages requires a patent holder to show that (1) the infringing activities occurred after the publication of the patent application, (2) the patented claims are substantially identical to the claims in the published application, and (3) the infringer had “actual notice” of the published patent application.

Fritz Klantschi

This is the second of four articles discussing the basics of filing a U.S. patent. Once all searching has been completed with no major conflicts, the patent application must be prepared.  The Drafting Stage is the formal process of preparing a patent application for filing with a country’s patent office.  This discussion is directed towards the preparation and filing of utility patents which are the most common patents.  There are two other types of patents in the U.S., design patents and plant patents.  Design patents provide protection for the ornamental design of a functional item.  Plant patents provide protection for any novel, non-obvious, asexually reproducible plant.  Design patents and plant patents will be discussed in future articles.

Drafting the Application

Innovation within a company is generally defined by inventors through Invention Disclosure Forms.  These disclosures are generally reviewed by a committee comprised of engineering staff, business decision makers, and an intellectual property attorney.  The committee may be assisted by the results of one or more of the above-described searches.  Once the committee greenlights an innovation and determines there is value in obtaining patent protection, the drafting stage begins.

The drafting stage generally commences with a meeting between the patent attorney and the inventor(s).  From this meeting preliminary drawings may be produced and a set of patent claims identified.  The United States Patent and Trademark Office (USPTO) rules require that a patent application contain at least one patent drawing depicting the invention, whenever the invention is capable of being graphically represented.  Patent drawings aid in the understanding of the invention.  Patent claims define the invention.  The patent attorney prepares a first draft of the patent specification and drawings which are reviewed by the inventor(s) and other engineering staff.  Comments/suggestions are incorporated and a final draft specification and set of drawings are distributed for review and approval.  Depending on the complexity of the technology and the completeness of the design, the drafting stage can take one to four months.

Filing the Application

The USPTO allows for the filing of different types of patent applications.  With respect to utility patent applications, a company/applicant can file a provisional patent application or a non-provisional patent application.  A provisional application is a legal document that establishes an early filing date, but does not mature into an issued patent unless the applicant files a regular non-provisional patent application within one year of the filing date of the provisional patent application.  A complete non-provisional application differs from a provisional application in that a non-provisional must contain at least one claim and is to be examined.

One or more provisional patent applications may be filed when the commercial embodiment of the invention is not yet defined.  As the product design is refined, additional provisional patent applications may be filed.  Within one year of the filing date of the first provisional patent application, a non-provisional patent application incorporating the subject matter of previously filed provisional patent application(s) has to be filed to maintain the priority date of the first provisional patent application.

Provisional patent applications in this situation are used to obtain priority dates for the invention and developments as they occur.  Provisional patent applications are not examined or ever published by the USPTO.  Filing multiple provisional patent applications is a cost-effective way to obtain priority date(s) for product development because the filing fee for a provisional patent application is considerably less than the filing fees for a non-provisional patent application, and provisional patent application(s) do not commence the USPTO examination process.

Filing a non-provisional patent application starts the examination stage of the patent process.  Once a non-provisional patent application is filed with the USPTO, other documentation such as an Assignment, Oath and Declaration, and Power of Attorney also need to be filed.

International patent applications must be filed within one year of the earliest-filed U.S. patent application to obtain the priority date from the U.S. filing.  There are two ways to file a foreign patent application, direct filing and through the Patent Cooperation Treaty (PCT).  A description of foreign patent applications (filing and examination) will be discussed in a separate article.

Fritz Klantschi

This is the first of four articles covering in general terms the process to secure patent rights both domestically and in foreign countries.  This first article discusses the preliminary phase of the process, before the patent application is filed. Each of the areas discussed is a brief overview of an aspect of the patent process.  If you and your management team wish clarification or elaboration on any of the topics, please contact our office at your convenience.  We welcome an opportunity to discuss the patent process and answer any questions you may have.

A company’s intellectual property (IP) program should parallel the company’s product development cycle.  At various stages of the product development process, various IP activities are suggested.  Early in the process, the IP activities are designed for information gathering and decision-making.

The following paragraphs highlight various types of searches and analyses that may be conducted prior to starting the formal process of drafting a patent application.  The described searches/analyses are not the only types available.  Rather, they are some of the more frequent searches/analyses conducted.  Results from these searches/analyses give a company necessary information to make decisions on proceeding with development and/or seeking patent protection for their product.   Not all companies, however, conduct all of these searches/analyses.

At the outset, it is incumbent for companies to regularly evaluate product development and research progress in the applicable technology areas.  For a company contemplating entering a particular technology area, a State of the Art Patent Search may be conducted.  A State of the Art Patent Search is the most general of all the patent searches and provides a broad review of what exists in a given field.  This type of search provides up-to-date information about progress in a specific technical field.  Even for companies currently active in a particular field, State of the Art Search results can lay out a path to design around the current art.

A Patent Landscape Report is a deeper analysis of the results of a State of the Art Search.   By examining large sets of patent data, a company gains a better understanding of the “big picture” to help them make informed decisions.  A Patent Landscape Search can identify potential patent portfolios for acquisition, existing or potential infringers to be pursued, and potential technology to be exploited.

To obtain U.S. patent protection, a potential invention must be new (novel), useful, and non-obvious (There is sufficient difference in the invention from what is known such that one of ordinary skill in the technology area would not find the difference(s) obvious to make the change(s).)   A Patentability Search is used to determine what scope of protection, if any, may be available for a particular embodiment (an embodiment is a version of the invention (i.e., the manner in which an invention is made or used)) of an invention. Patentability searches are typically conducted after the conceptual engineering stage.  A Patentability Search will strengthen a patent application by better defining the inventive contribution of the new product over the prior art.

Many companies understand the value of seeking patent protection before launching a product.  Equally important is obtaining product clearance is a “freedom to operate” (FTO) opinion.  A FTO opinion determines whether there are claims in any unexpired patents that might be construed to cover a commercial embodiment of an invention (i.e., whether the company’s new product may infringe one or more claims of an unexpired patent.). By performing FTO analysis before developing and launching a new product, a company can limit the risk of future litigation and avoid unnecessary expense.  FTO analysis done early in the cycle of product development affords companies the opportunity either to modify the design and avoid infringement or to seek a license.  FTO searches are often conducted simultaneously with a patentability search.

If after review of any commissioned searches/analyses, a company decides to proceed with patenting their innovation, the process enters the Drafting Stage.

A recent federal court decision that clears the way for federal trademark registration of the mark BOOKING.COM may signal a departure from current practice for the registration of marks made up of generic terms in domain names.

On August 9, 2017, the U.S. District Court for the Eastern District of Virginia reversed a decision of the U.S. Patent and Trademark Office’s (USPTO) Trademark Trial and Appeal Board, holding that the company Booking.com B.V. was entitled to registration of its BOOKING.COM mark for various travel reservation and related services, even though the terms “booking” and “.com” by themselves are generic for the services. Further, the court found that the combination of a generic word and a top-level domain “generally has source identifying significance,” a departure from the conventional guidance of the USPTO.

The BOOKING.COM Applications

The USPTO had refused registration to four applications for BOOKING.COM in standard characters (word only) and various stylized forms on the basis that the marks were generic for the services.

Generic terms (i.e., the name of the goods or services) are not eligible for registration because such terms are not capable of identifying the source of the goods or services. Allowing registration of these marks could prevent others from using a common term for the goods. Terms that describe some characteristic of the goods or services are only capable of registration if they have “acquired distinctiveness,” which means that the term has taken on a meaning in the public view so that people see the term as a trademark or service mark identifying the goods or services rather than simply describing the goods or services.

After the applications were refused, Booking.com appealed the refusal of registration to the USPTO’s Trademark Trial and Appeal Board (TTAB), which hears challenges to the decisions of the USPTO’s examining attorneys on pending applications. The TTAB upheld the refusals to register, finding that the addition of “.com” to “booking” did not negate the generic character of “booking” for travel reservations.

Options for Challenging Refusal of an Application

The losing party in a TTAB challenge has two options: 1) appealing the refusal to the Federal Circuit Court of Appeals, a federal appeals court that hears intellectual property matters or 2) filing a new complaint in a federal district court. In this case, Booking.com filed a new action in the Eastern District of Virginia, which had important implications for the evidence it was able to present to the court.

When a trademark applicant appeals to the Federal Circuit, the court considers the application on the record that was presented to the TTAB, using the standard of whether the decision of the TTAB to refuse registration was supported by substantial evidence. On the other hand, parties to a new case filed in federal district court can submit new evidence, and the court makes its determination de novo, that is, without regard to the TTAB’s factual findings and decisions. Though the option of proceeding de novo before the district may seem attractive because of the ability to present new evidence, due to a recent change in law, the USPTO may be entitled to reimbursement of its expenses, which may include attorneys’ fees, from the party bringing the action, regardless of the outcome of the case. (The parties in the BOOKING.COM case currently are briefing the USPTO’s request for reimbursement.)

The Decision – BOOKING.COM Is Not Generic

The issue to be decided was whether the combination of “booking” with the top-level domain (TLD) “.com” was generic – and not entitled to registration – or descriptive – and entitled to registration with a showing of acquired distinctiveness.

The court first found that the term “booking” is generic for the services in Booking.com’s application. This could have been the end of the story if the case was before the Federal Circuit, where a number of cases have held that the addition of a top-level domain (TLD) like .com to a generic term creates a term that is still generic. But the Eastern District of Virginia, using the less deferential standard of de novo review, distinguished prior Federal Circuit cases that had considered similar facts.

The court, noting that the public perception of domain names has changed since the first Federal Circuit case on the issue in 2004, found that a domain name is by its nature unique. Rather than considering whether “booking” alone is the type of service Booking.com provides, the court focused on whether “booking.com” is the class of service.

Notably, the court found Booking.com‘s survey on consumer impressions of the mark, which indicated that consumers believed the mark to be a brand name, to be persuasive. The survey was among the new evidence the company submitted, which would not have been permitted in an appeal to the Federal Circuit.

Having found that booking.com is not generic for the company’s services, the court then went on to hold that the mark had acquired the source-identifying distinctiveness for hotel reservation services necessary for registration of a descriptive mark, but not for travel agency services. The court found acquired distinctiveness based on the extensive evidence of the company’s advertising and sales. (Two of the applications at issue, which contained design and color elements in addition to the wording, were sent back to the USPTO for review of whether these additional elements were eligible for protection.)

The Future for Domain Names?

Although the case marks a departure from the conventional wisdom about trademark registration, it is important to note that Booking.com may still have relatively limited protection for its mark. The court emphasized that it was not giving Booking.com a monopoly on the term “booking,” and even with a federal trademark registration Booking.com could not prevent others from using domain names that included “booking.com” along with other words. Still, the ability to federally register the mark provides important evidentiary presumptions for enforcement purposes.

The decision also highlights the potential implications to a trademark applicant of deciding whether to appeal a refusal of registration to the Federal Circuit or file a new case in a district court as Booking.com did here.

Whether this decision will change trademark practice remains to be seen. The USPTO apparently maintains its position that adding a TLD to a generic word generally is not sufficient to create a mark capable of registration, and the USPTO may appeal this decision. This will continue to be an issue to watch.

A couple of recent court decisions have brought attention to the manner in which the design features of a tangible object can be protected under U.S. intellectual property law.

The Supreme Court, in Star-Athletica, L.L.C. v. Varsity Brands, Inc. held in March that the design on a cheerleading uniform can be eligible for protection under U.S. copyright law.  Previous precedent made it difficult to obtain copyright protection in fashion because clothing is considered a “useful article” not valid for protection.

About a week later, a jury in the United States District Court for the Central District of California found in favor of Dan Aykroyd’s company Globefill Incorporated against Elements Spirits, Inc. an accused infringer selling alcohol in a skull-shaped bottle.  Globefill prevailed based upon its trade dress in its own skull bottle.

Together with design patents, trade dress and copyright form a trifecta of methods for protecting the design or configuration of a tangible object.  This protection is available for decorative, non-functional features, which differs from the more common type of patent, utility patent, available only if the invention is “useful.”

The differences among the types of protection for trade dress, copyright, and design patents, can be understood in the context of the purpose of those laws.  Trademark and trade dress law is to protect consumers from confusion.  Patent and copyright law are to incentivize creation.

A few distinctive features of each one are described below:

Trade dress: Trade dress consists of all the features that make up the product design or product packaging and together serve as a source identifier that consumers can use to distinguish among brands. Therefore, a product design or packaging must be able to identify the source of the owner’s goods or services in order to qualify for protection under U.S. trademark law.

There are two types of trade dress: product design and product packaging. It is more difficult to get a federal registration for product design than for product packaging. Trade dress protection is not available for functional aspects of the object (e.g., if the shape of a bottle makes it easier to grasp), but it can be difficult to determine functionality. Registration of trade dress in the United States can be perpetual, as long as the owner continues to use the trade dress and pay a periodic renewal fee to the U.S. Patent and Trademark Office.

Copyright: United States copyright law protects original works of authorship fixed in a tangible medium of expression. Copyright protection is not available for useful articles because the protection of rights in useful articles falls within patent law.

The Star Athletica decision articulated the test as whether a claimed non-utilitarian function of a useful article “(1) can be perceived as a two- or three-dimensional work of art separate from the useful article and (2) would qualify as a protectable pictorial, graphic, or sculptural work . . . If it were imagined separately from the useful article into which it is incorporated.”

The duration of copyright registration varies depending upon the owner, but is much longer than patent protection. For example, the copyright registration for a work owned by an individual author is the life of the author plus seventy years.

Design patent: To obtain a U.S. design patent, an applicant must invent a new, original, and ornamental design for an article of manufacture article, which cannot have been disclosed more than a year prior to application. Design patent protection is only available for an article of manufacture. A design patent originating in the U.S. expires fourteen years after it is issued by the U.S. Patent and Trademark Office.

Enforcement and Damages

Rights in trade dress and copyright exist whether or not the owner has obtained a registration, but registration, or at least a pending application, provides a copyright owner access to federal courts, which is crucial for enforcement.  While unregistered trade dress infringement claims can be brought in federal court, registration provides a presumption of validity and ability to obtain greater damages.  Patent rights require registration. Trade dress and patent registration can be more costly to obtain than copyright registration, due to filing fees and the complexity of the registration process.

Various monetary remedies are available in trade dress cases, which attempt to approximate the damage to the owner’s good will. The court may increase the amount of damages if the infringement is willful. Attorneys’ fees are available in exceptional cases.  In the Globefill v. Elements case, the judge recently (on June 13, 2017) tentatively awarded $870,000, defendant Elements’ disgorged profits.

Copyright law allows the plaintiff to elect actual damages or statutory damages. Statutory damages can range from $750 to $30,000 per infringed work, or up to $150,000 per work if the infringement is willful. Attorneys’ fees are available to the prevailing party in certain circumstances based on a multi-factor test.

Damages for design patent infringement can be the total profit of the infringer. This has been in the news due to a December 2016 Supreme Court ruling overturning a $400 million verdict in favor of Apple for Samsung’s infringement of Apple’s design patents. Where previously, the profits were based upon the entire article of manufacture (e.g., a phone), the Supreme Court held that the profits can be based upon a component of the infringed article (e.g., user interface).

Injunctive relief preventing future sales of infringing products are available for all three.

The type of protection available depends upon the type of work at issue, but it can be possible to own trade dress, copyright, and design patent registration for the same article. For example, Dan Aykroyd’s company, Globefill, owns trade dress, copyright, and patent registrations for its skull bottle. In the Elements case, Globefill only asserted trade dress infringement, though Globefill has brought claims against at least one other company for copyright and design patent infringement.  An intellectual property attorney can help your company determine what rights it has and the best way to protect them.

1. Kayne’s Motion for Partial Summary Judgment Denied

For years, Kayne purchased a single-copy subscription to Oil Daily (“OD”), a daily publication provided by Energy Intelligence Group, Inc. and Energy Intelligence Group (UK) Ltd. (“EIG”) and routinely forwarded copies to Kayne employees and third parties. EIG sued Kayne in the U.S. District Court for the Southern District of Texas for copyright infringement.

Kayne moved for summary judgment on two issues. First, Kayne argued that an annual subscription to OD constituted a single “work” under the U.S. Copyright Act. Prevailing on this issue was critical to EIG because it would have a drastic impact on the amount of damages that could be awarded. The Court was not convinced by Kayne’s argument that the annual subscription to OD constituted a compilation (and therefore a single work), because a compilation involves compiling and arranging preexisting materials resulting in a new original work.  EIG’s daily issues of OD consist of current news and analysis in the oil and gas industry, not a compilation of preexisting materials. Moreover, EIG’s decision to sell annual subscriptions did not turn daily issues into an annual single work. The Court further noted that OD was not registered with the Copyright Office under a single annual registration number, nor was it sold or marked as an annual single work.  The Court denied summary judgment on this issue.

Second, Kayne sought partial summary judgment based on the three-year statute of limitations on copyright actions, seeking to dismiss all claims of infringement prior to three years before the filing of the lawsuit alleging EIG knew or should have known of Kayne’s infringing activities.  The Court noted that Kayne relied on factual evidence that, if true, could show that EIG had notice of facts that, in the exercise of due diligence, would have led to EIG’s actual knowledge of Kayne’s infringing activities and therefore the beginning of the limitations period. Because Kayne’s evidence could lead a reasonable fact-finder to infer that EIG exercised due diligence, the Court denied Kayne’s motion for partial summary judgment.

1. EIG’s Motion for Partial Summary Judgment on Defendants’ Affirmative Defenses Granted Except for the Defense of Failure to Mitigate

In the answer to the Amended Complaint, Kayne asserted five affirmative defenses. Only one survived EIG’s motion for partial summary judgment. The Court granted EIG’s motion with regard to Kayne’s affirmative defenses of equitable estoppel, implied license, unclean hands/entrapment, and comparative fault.  First, Kayne argued that under the doctrine of equitable estoppel, it continued infringing OD because it was led to believe that EIG would not pursue damages beyond retroactive subscription fees for the prior infringement.  The Court noted that Kayne cited no case holding that such a belief, regardless of how it was arrived at, would support a finding of equitable estoppel, and that Kayne offered no evidence that it acted in reliance on its belief, whether reasonable or not.

Second, Kayne asserted the defense of implied license alleging that it was common “unwritten” practice for EIG to allow a subscriber’s secretary to access OD and make a copy for the subscriber.  The Court noted that such “ordinary business practices” would not be considered infringing activity, and that such activity would not require a license. The Court further found, even assuming for the sake of argument that such a practice would give rise to an implied license, there must be some conduct or expression from which the license can be implied, which Kayne failed to offer.

Third, Kayne asserted the defense of unclean hands/entrapment alleging that EIG, by design, “set a trap” for Kayne in an attempt to augment their damages by strategically delaying litigation.  The Court found that Kayne cited no examples of strategic delay providing the basis for an unclean hands defense.

Fourth, the Court found Kayne’s “comparative fault” defense to be inapplicable to copyright infringement claims.

Kayne’s affirmative defense of failure to mitigate, however, survived EIG’s motion. The Court held that Kayne’s burden of proof at the summary judgment stage was significantly lessened, and that a fact-finder could infer EIG’s actual or constructive knowledge from the available evidence such that the subsequent alleged infringement could have been avoided.

EIG also prevailed in successfully obtaining a Protective Order limiting discovery sought by Kayne that the Court found to be either irrelevant, hypothetical and/or not proportional to the needs of the case.

Energy intelligence Group, Inc. and Energy Intelligence Group (UK) Limited v. Kayne Anderson Capital Advisors, LP and KA Fund Advisors, LLC is civil action No. H-14-1903 in the Southern District of Texas.

On January 17, 2017, Feld Entertainment, the parent company of Ringling Bros. and Barnum & Bailey, announced that it is closing down the circus. According to a press release, the last performance of the Ringling Bros. circus will be May 7, 2017. Feld will continue to offer other shows such as Disney on Ice and Marvel Universe LIVE!.

Since its inception in 1871 under a different name, the Ringling Bros. and Barnum & Bailey Circus built up a valuable brand. Generations of circus goers (this author included) cherish childhood memories of lion tamers, tightrope walkers, and other death-defying feats, all orchestrated by a ringmaster in a top-hat and tails.

So what happens to the brand? In a situation like this, where the brand owner (or at least the parent company) remains in business, can it keep others from exploiting the goodwill in its trademarks once use ceases?

Under United States trademark law, trademark rights are tied to use of the mark for particular goods or services. The trademark owner can keep others from using a confusingly similar mark for the same or related goods and services. But the owner also can lose its ability to enforce its rights by abandoning its mark. While the law seeks to prevent consumer confusion, it also discourages brand owners from continuing to “warehouse” their trademarks long after use has been discontinued.

According to the Lanham Act trademark statute, a trademark is abandoned when use is discontinued without intent to resume. 15 U.S.C. § 1127. Three years of non-use is considered presumptive evidence of abandonment, though courts and the Trademark Office will look to other circumstances as well. Here, Feld unequivocally announced its intention to close down the big top. On its face, that seems like abandonment without intent to resume, particularly where resuming use would seem to be a Jumbo undertaking in light of everything entailed in bringing the circus back together.

Ringling Bros.-Barnum & Bailey Circus Combined Shows, Inc. owns around forty active federal trademark registrations. Several of these registrations incorporate RINGLING BROS. or RINGLING BROS. AND BARNUM & BAILEY for use in conjunction with not just entertainment services, but also clothing, plush toys, and scientific study and research regarding elephants. The company also owns registrations for THE GREATEST SHOW ON EARTH in standard characters (word only) and stylized forms for entertainment services as well as merchandise and programs.

Through the years, Ringling has been vigilant in enforcing its trademark rights, including bringing twenty-one oppositions to pending applications and requests for cancellation of registrations before the U.S. Patent and Trademark Office since 1970, as well federal lawsuits for trademark infringement.

It will be several years before some of Ringling’s registrations are due for their next renewal, when Ringling must provide examples of use to the U.S. Patent and Trademark Office or the registrations will be cancelled.

Even for a mark no longer in use for its core goods or services, some courts have held that the owner can maintain “residual rights” in a mark. The theory is that consumers may continue to associate lingering goodwill with the mark even after use is discontinued. But this “residual” goodwill fades over time. Also, in order to maintain a U.S. Federal trademark registration, the owner must periodically demonstrate use of its mark. Such use must be “actual use,” which means that it is more than token use merely to reserve rights in its mark.

Another option to maintain some trademark rights could be to continue selling collateral goods, such as t-shirts. Again, the brand owner’s rights in its mark are tied to use for particular goods or services, so it must prove that an accused infringer’s mark is confusingly similar to the mark for the goods and services for which the owner’s mark is used. In this example, if an unrelated company started a “Ringling” circus, Ringling (or Feld) would need to demonstrate that consumers would be likely to confuse the use of the imitator’s “Ringling” circus with genuine Ringling-branded t-shirts, or any residual rights in the brand related to its entertainment services. (A court also would consider whether the other party exercised bad faith in adopting a knock-off brand to trade on Ringling’s remaining goodwill.)

As in the hypothetical above of a new “Ringling” circus, some new owners have even found a business model in reviving the dead brands of others. For example, POLAROID, SHARPER IMAGE, and NUPRIN all were brought back after the prior owners discontinued the use of the marks.

A company should exercise caution in public statements about the future of its brands, especially if there is a possibility of reviving the trademark use. The time and expense of maintaining some actual use and enforcement of a trademark may be prohibitive, especially for a failing brand. All of these considerations should be explored before a decision to abandon a trademark is made.