The U.S. Patent and Trademark Office (“PTO”) is warning business owners and individuals who own federal trademark registrations to be wary of unsolicited mail and emails that look official but are really are the work of scam artists. Here’s how the scam works. The scammers find your contact and official registration information using the public PTO database and then use it to create official-looking correspondence that appears to be from the PTO.
The official-looking correspondence sometimes requests that fees be paid to maintain the validity of a registration, or that fees be paid for trademark monitoring services. Note, however, that the PTO’s trademark communications are always from, “The United States Patent and Trademark Office” in Alexandria, Virginia, and PTO email is always from the domain, “@uspto.gov”.
Bowie & Jensen’s trademark attorneys can quickly spot a trademark scam and so your safest course is to check with the firm before responding to any PTO or official-looking correspondence, and particularly before paying any fees requested by mail or email. Of course, ignoring correspondence that you believe to be a scam also has its risks because failing to pay maintenance and other legitimate PTO fees puts a registration at risk of being canceled.
For more information contact Mike Oliver or Kimberly Grimsley.
FAIR USE FIASCO – BE CAREFUL USING *ANY* IMAGE ONLINE by Mike Oliver
The internet is littered with millions of images – taken by professional and amateur photographers alike, that contain NO identification of the author of the image. In part, this may be because it is not known, and in part it could be that the “meta data” in the image – which if done professionally will typically have the author’s name and the claim of copyright embedded as text inside the file (known as EXIF data) – is stripped off.
A recent decision in the 3rd Circuit (Pennsylvania, New Jersey, Delaware, and the Virgin Islands), Murphy v. Millennium Radio Group, LLC, [https://www.ca3.uscourts.gov/opinarch/102163p.pdf] demonstrates how dangerous it is to post on your website an image that does not contain this “copyright management information.”
In Murphy, a professional photographer took a picture of two radio show shock jocks, partially nude, for a print publication. The photographer maintained copyright. A radio station employee scans the image, posts it on the radio station website, and invites people to “photoshop” the image in a contest. No attribution identifying the photographer is given.
The photographer sues and loses in the trial court – essentially because that court believed the use was a fair use or licensed. The appellate court, however, reverses. It holds that under the Digital Millennium Copyright Act, the “copyright management information” includes identification of the author of the image. Of important note – the DMCA for the purposes of this provisions, has no “fair use” defense – in other words, the copyright management information must always be included.
The take away here is that if you are electronically displaying images in which you are not the author, the EXIF file data – the data that is embedded in the image and can be read by software to see the copyright management information – cannot be stripped off the file. In addition, if you are using stock photography, or manage a stock photo site, the EXIF data must be retained in the image.
For more information, please contact Mike Oliver.
In University of Alabama v New Life Art, the 11th Circuit Court of Appeals resolved a portion of a long standing dispute over the protection afforded authentic reproductions of college uniforms. A painter made paintings (and calendars) accurately depicting University of Alabama games. For many years this practice was unlicensed, but done with the knowledge of the UofA. Later, the painter began using the paintings he created on mugs, towels, t shirts and so on. Eventually the University of Alabama required use of accurate depictions of the uniforms to be licensed, and the artist refused. Therein ensued litigation, now in its 7th year.
The 11th Circuit held that “An artistically expressive use of a trademark will not violate the Lanham Act “unless the use of the mark has no artistic relevance to the underlying work whatsoever, or, if it has some artistic relevance, unless it explicitly misleads as to the source or the content of the work.”
Thus the paintings were held to be protected under the implied fair use rights under the 1st Amendment, even though they depicted the uniform colors. The other issues were remanded as the record had not been developed on them (somewhat surprising after 7 years of litigation!)
It should be noted that the University had licensing agreements with the artist in some respects (they gave him press credentials to access games and allowed him to create a painting live on air at one point – without however licensing his subsequent sales of reproductions of those paintings). The terms in the license agreement were very broad, but not broad enough to cover the colors on the uniforms when shown on a uniform.
This case demonstrates that the cost of fair use determinations is substantial, and the findings can be somewhat limiting – indeed, it is not clear the artist will prevail on the other claims – he apparently did not raise fair use on appeal as to them, and there is an argument that the licensing agreements he had signed did cover those items.
Use of an aggressive trademark holders marks, even trade dress, without a license, and even with a fair body of case law finding fair use, can be very risky.
For more information, contact Mike Oliver or Kimberly Grimsley.
In Continental Datalabel, Inc. v. Avery Denison Corp, 09 C 5980 (U.S. D. N.D. Ill 2012) the 7th Circuit considered numerous legal issues arising from a war between two companies that manufacture sticky labels.
Despite the increasing use of electronic data storage, there still seems to be a high demand for labeling things. This apparently hotly contested market is dominated by Avery Denison. Avery makes labels that are perforated, so the user can easily peel the label from the backing. This works well, but if a user is not careful, and does not need all the labels in a row, this will leave some labels without backing on the edge, and hence unusable in a printer.
So, Avery’s skilled inventors devise a new invention, the “pop up edge” which allows the user to “fold” the back, pop up some labels, and then refold it flat. This allows it to be re-printed, and also, keeps the unused labels on the backer board. It looks like this:
Avery sells its labels among other places, Staples. It advertised this new product as follows: “Only Avery label sheets bend to expose the Pop-up Edge™” and “Only Avery offers the Pop-up Edge™ for fast peeling—just bend the sheet to expose the label edge.”
Competitor Continental Datalabel also sells peel off labels. It also had perforated rows, but its labels suffered the same issue as Avery’s perforated rows. So, Continental Datalabel also marketed that its products could be folded to reveal the label, and then re-flattened.
Avery filed a patent application on the “Pop Up Edge” technology. Before the patent issued, it allegedly threatened retailers with patent suits if they sold products of Continental Datalabel. It also sent one email in which it said “Avery has made 2 rounds of patent applications for Easy Peel. The first set of patent applications were filed several years ago and the additional patent applications were filed for the pop up edge which are even stronger than the first set of filings. Once the patents are granted Avery will aggressively defend its IP.” (emphasis added).
As one might imagine, the retailers, fearing a patent suit if they sold a possibly infringing product in the future, refused to deal with Continental Datalabel. Predictably, Continental Datalabel sued. The two main arguments presented by Continental Datalabel were (1) that the two statements above stating that “only” Avery sold fast peeling label sheets was false and misleading advertising; and (2) that Avery’s threats to Staples and other retailers that it had existing patents (at a time when it did not have any) and threatening to file future lawsuits on as of yet issued patents, violated Continental Datalabel’s rights.
Continental Datalabel lost this case (at least at this phase). With respect to the false advertising claims, the claims refer to a trademarked term “Pop Up Edge” and not to a generic “easy peeling” label sheet. In false advertising cases there are primarily two types of false advertising. Literally false statements, and literally true statements that are misleading. Proof of the former eliminates the need to show any harm or actually misled consumers – because a person who makes a literally false statement is presumed to have intended to mislead. Proof of the latter, however, requires that “the plaintiff  prove that the statement is misleading in context by demonstrated actual consumer confusion.” (emphasis added). Here, the court held that the claims were literally true, primarily because the modifier “only” modified “Pop Up Edge” which was claimed as a trademark. So, it was literally true that “only” Avery sold products with “Pop Up Edge™” technology. Thus, Continental Datalabel was required to show actual confusion. It attempted to do this via a survey, and by testimony of an expert. The expert, however, failed to survey respondents on the meaning of “Pop Up Edge” and as a result, his expert testimony was essentially disregarded.
On the claims regarding enforcement of the patent, the plaintiff was not able to provide any non hearsay evidence that anyone from Avery ever threatened Staples with patent infringement before a patent was issued. It is clear law that threatening enforcement of non existent intellectual property rights is wrongful, and that you cannot infringe a patent application. [Side note – you can however give notice of the patent that is pending, to a person who might be infringing, and indicate that you will seek a reasonable royalty for any infringements prior to the date of issuance, under 35 U.S.C. Sec 154(d) – and that is clearly protected communication – it is not clear why Avery did not use this statute here]. So, the only evidence that remained was the email noted above. That email, however, only stated that Avery would aggressively enforce rights after they were acquired.
The Court’s discussion here is instructive:
“Indeed, any state law imposing liability for warning of potential patent litigation, without more, would be preempted by federal patent law, which “preempts state-law tort liability for a patentholder’s good faith conduct in communications asserting infringement of its patent and warning about potential litigation.” Globetrotter Software, Inc. v. Elan Computer Group, Inc., 362 F.3d 1367, 1374 (Fed. Cir. 2004); see also Virtue v. Creamery Package Mfg. Co., 227 U.S. 8, 37-38 (1913) (“Patents would be of little value if infringers of them could not be notified of the consequences of infringement …. Such action, considered by itself, cannot be said to be illegal.”). The principle applies to a patent applicant’s statement that it will enforce its patent once the patent is granted. See Scosche Indus., Inc. v. Visor Gear Inc., 121 F.3d 675, 680 (Fed. Cir. 1997) (affirming summary judgment for the defendant on a California unfair competition claim where the defendant told a non-party that “[w]e believe that the product sold by [the plaintiff] falls within the scope of the pending application and that their sale of the [product] will infringe [the defendant’s] patent when it issues,” and noting that the plaintiff “points to no authority holding that it is unfair competition for a patent applicant to advise a prospective customer of the status of his pending patent application and of the applicant’s belief that competing goods will infringe the patent if and when it issues”). There is an exception to this preemption principle: “State law claims … can survive federal preemption only to the extent that those claims are based on a showing of ‘bad faith.’” Globetrotter Software, 362 F.3d at 1374.
It is true that the precise wording of Avery’s email—“Once the patents are granted”—suggests that it expected to receive a patent when in fact it could not have been certain that the USPTO would grant its applications. But, again, Continental has cited no authority for the proposition that a company’s expression of confidence that a patent will be granted can be tortious. The case it does cite, Foboha GmbH v. Gram Technology, Inc., supra [2008 WL 4619795, at *1-2 (N.D. Ill. Oct. 15, 2008)], is not on point because it dealt with flatly false statements: the defendant first demanded that the plaintiff pay to use the defendant’s “patented technology” when the defendant had not yet been granted a patent, and then, after the USPTO reexamined the defendant’s patent and rejected claims 1 through 10, the defendant published a press release stating that “the [USPTO] has confirmed the patentability of the [patent’s] 10 original claims.” Id. at *1-2. Avery’s email, by contrast, was not false; in particular, it neither asserted that Avery already had a patent nor asserted that Avery would sue for violation of its patent application before an actual patent was granted. If anything, the email acknowledged to Staples both that Avery did not yet have patents and that it could not sue on a patent application. Avery sent the email in response to a question from a Staples employee asking whether Avery had any “opinion letters from outside counsel that clears its Easy Peel patents?” Doc. 203-2 at ¶ 116. A rule prohibiting a prospective patentee from telling interested firms what it intends to do with the patent if granted would make no sense. Cf. Atanus v. Am. Airlines, Inc., 932 N.E.2d 1044, 1050 (Ill. App. 2010) (“where a business entity provides accurate and proper reports to another entity in a reasonable business transaction, providing those reports should not constitute intentional interference”).”
This case is a good example of some of the more technical issues in both advertising statements (it was somewhat critical that Avery applied the “TM” symbol by the words “Pop Up Edge”), the danger of exclusionary assertions like “Only” which is not mere puffery – or at least no party apparently asserted it was here, and the risks of warning customers that you will sue them before you actually have the intellectual property rights to do so. It is also yet another case in a long line of cases where the survey was not done correctly.
For more information on issues arising in marketing, advertising and IP enforcement statements, contact Mike Oliver.
In AKAMAI TECHNOLOGIES, INC. v. LIMELIGHT NETWORKS, INC. (Fed Cir. August 31, 2012) the en banc court held that a person can be liable for inducement to infringe even if the direct infringement is only found by combining the acts of more than one other person. You can read all 103 pages of the case here: Akamai v Limelight
What? In English: If you are aware of a patent (inducement requires specific intent to induce, so it requires knowledge of the patent) and you either perform one step in the method and induce one or more other persons to perform the remaining steps, or if you induce two or more other persons to engage in steps that together infringe, you are liable for inducement to infringe.
This is a major change in the law. This case overruled a recent prior case that had held that inducement requires inducing a single other party to engage in the acts that constitute direct infringement.
What does this mean? It means that if you are a business that say, provides a load balanced server farm for your clients, and you make that server farm available to your clients, who use it to manage their web content, and Akamai informs you of their patent that covers this technology, you will be liable for inducement to infringe even though the mere operation of a server farm does not practice every element in the claims of the patent. It means that businesses that are made aware of patents will have to consider every conceivable set of steps, whether done by their clients or others (inducement does not require any agency between the inducer and the person engaging in direct infringement) because the patent holder can “aggregate” all of the users it needs to meet the requirement of showing infringement.
There were numerous dissenting opinions, and it is somewhat probable that the Supreme Court will take this case.
For more information, contact Mike Oliver.
BitTorrent is a peer to peer file sharing protocol that allows its members to share pieces of a file simultaneously such that each user can access and view the entire file without downloading it completely. It was designed to facilitate the sharing of large files and minimize the demand on an individual server. A seed user uploads the file and then peer users join the network, each simultaneously sending and receiving pieces of the file within the swarm of users.
BitTorrent file sharing has the capacity to be used for software and content updates as well as the authorized distribution of media content and comprises a significant amount of total web traffic and bandwidth consumption. Several BitTorrent sites index and catalog publicly-available media files, including movies, television shows, music, video games, and applications, while some files are shared only within a closed group.
When copyright protected material is shared using a BitTorrent protocol without the holder’s permission, each transmission among the users constitutes a copyright infringement. Media distributors, including movie studios, have begun targeting BitTorrent peers through their IP addresses and filing mass lawsuits against up to several thousand downloaders at time. Statutory penalties can be as high as $150,000 but are often much lower.
For the purposes of naming defendants in these sweeping lawsuits, internet service subscribers are identified by their IP addresses. For business owners, that means that any infringing downloads that occur over your connection by your employees, customers, and neighbors can be traced back to your business, in much the same way that a red-light ticket comes to the registered owner of a car regardless of who was driving it. While you may not be able to monitor all internet activity over your home or business network, especially if you have a large number of employees, network security and clear policies and training on internet use limitations can help to prevent unwanted copyright infringement in your business’ name. BitTorrent files and client software often carry viruses and malware as well and should be avoided unless needed for a designated purpose.
For more information on BitTorrent copyright enforcement contact Mike Oliver.