Tag Archives: intellectual property litigation

U.S. Supreme Court Argument — Should Federal Courts Exercise Jurisdiction Over Patent Legal Malpractice Claims?

Posted on December 3, 2012 by | Comments Off on U.S. Supreme Court Argument — Should Federal Courts Exercise Jurisdiction Over Patent Legal Malpractice Claims?

by: Kelly A. Williams, a shareholder at Picadio Sneath Miller & Norton, P.C.

LasSupreme Courtt week, an intellectual property law group, the American Intellectual Property Law Association (“AIPLA”), argued before the U.S. Supreme Court that state court, rather than federal court, is the appropriate venue to hear legal malpractice claims involving patents.  AIPLA was arguing in support of an amicus brief, or “friend of the court” brief that it filed in an effort to further aid and educate the Court in the matter of Gunn v. Minton.  AIPLA did not represent or have any connections to the parties in the case.

By way of background, AIPLA is a national bar association of approximately 14,000 members engaged in private and corporate practice, in government service, and in the academic community.  AIPLA represents individuals, companies and institutions involved directly or indirectly in the practice of patent, trademark, copyright and unfair competition laws, as well as other fields of law affecting intellectual property.

AIPLA took the position that the Federal Circuit, which has jurisdiction over patent cases, has taken an overly broad approach to subject matter jurisdiction.  AIPLA states that the Federal Circuit has been routinely finding federal jurisdiction over state law claims that raise patent law issues based upon Christianson v. Colt Indus. Operating Corp., 486 U.S. 800 (1988).  The Federal Circuit, according to AIPLA, has interpreted Christianson, as supporting the existence of jurisdiction any time a state law claim makes it necessary to resolve a federal patent issue.

AIPLA argued that this interpretation is wrong because Christianson did nothing to alter prior U.S. Supreme Court precedent that provided that a federal court may exercise jurisdiction over a state law claim raising a federal issue only when it is necessary, disputed and substantial.  This only occurs, according to AIPLA, when a claim creates a controversy as to significant patent law issues, such as a controversy regarding the validity of a patent, the construction or effect of a patent statute or a principle of patent law.  The Federal Circuit has combined these separate considerations, “necessary, disputed and substantial,” into a single question of whether any patent issue is “necessary” to the state law claim.

AIPLA also argued that by asserting subject matter jurisdiction over malpractice claims involving patents, the Federal Circuit is disturbing the Congressionally approved balance of federal and state judicial responsibilities.  Further, allowing federal courts to exercise jurisdiction over various state law claims merely because those claims raise a patent law issue diminishes the right of litigants to select a forum based on the traditional well-pleaded complaint rule.  This rule states that the plaintiff is “the master of its complaint” and may have its cause heard in state court by avoiding claims based on federal law.  However, the Federal Circuit’s exercise of jurisdiction over such claims forces litigants to litigate in federal court, even if the case involves local disputes involving local interests, simply because the dispute raises an issue relating to patent law.

For more information, the entire amicus brief of the AIPLA can be found here and a Law360 article can be found here (subscription required).

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Starbucks® v. Starbarks

Posted on October 31, 2012 by | Comments Off on Starbucks® v. Starbarks

by: Kelly A. Williams, a shareholder at Picadio Sneath Miller & Norton, P.C.

Near the top of the list of my favorite things in life (besides my family and working at PSMN of course) are dogs and Starbucks® coffee.  In fact, let me take a brief moment to give a shout out to my black lab, Sadie, who may be reading this blog over her morning crunchies (really—she’s that smart).  Anyway, because of my love of dogs, Starbucks® and intellectual property infringement law, this definitely caught my eye:  “Starbucks Objects to Dog Day Care Starbarks’ Logo,” which I found on the ABCNews website.

So what do you think?  Would people looking for a dog daycare likely be confused by a logo that looks like the Starbucks® logo but says Starbarks Daycare?  Maybe.  Maybe not.  I don’t want to take a position because I like both companies.  I think I’ll just sit back, have a cup of coffee and pet my dog (when I get home from work).  See you in a little bit, Sadie.

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Posted in Trademarks

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Further Discussion of Judge Wettick’s Opinion on Discovery of Social Media

Posted on September 28, 2012 by | Comments Off on Further Discussion of Judge Wettick’s Opinion on Discovery of Social Media

by: Kelly A. Williams, a partner at Picadio Sneath Miller & Norton, P.C.

As a follow up to Robert Wagner’s post, “Discovery of Facebook Accounts,” I will take a closer look at the analysis by Judge Wettick in Trail v. Lesko, No. GD-10-0172249 (July 3, 2012) for determining what a party needs to establish before Judge Wettick will order disclosure of non-public Facebook, or other social networking, content.  I will also provide an update on whether other courts have relied upon Judge Wettick’s opinion.

At the outset, Judge Wettick notes that no appellate court in Pennsylvania has addressed discovery requests for information contained within an individual’s Facebook profile.  He reviews the approach of other trial judges in Pennsylvania to date and concludes that most Pennsylvania “courts recognize the need for a threshold showing of relevance prior to discovery of any kind, and have nearly all required a party seeking discovery in these cases to articulate some facts that suggest relevant information may be contained within the non-public portions of the profile.  To this end, the courts have relied on information contained in the publicly available portions of a user’s profile to form a basis for further discovery.”

Judge Wettick also found the decisions of other state and federal courts to be largely in line with Pennsylvania case law.  As in Pennsylvania, other courts agree that the content posted by someone on Facebook is not privileged, either because communications with “Friends” are not privileged or because, if the communications were privileged, such privilege was waived by sharing the content with others.  On the other hand, the courts disfavor “fishing expeditions” and tend to require some evidence suggesting the existence of relevant information prior to ordering access to a person’s non-public social media information.  According to Judge Wettick, courts from other jurisdictions have taken more steps than Pennsylvania courts, however, to require more narrowly tailored discovery orders or have even relied on counsel to review his or her client’s profile for relevant information in the first instance.

Trail v. Lesko was a personal injury case arising from a motor vehicle accident which was allegedly caused by defendant’s drunk driving.  Judge Wettick indicated that he was basing his rulings on Pennsylvania Rule of Civil Procedure 4011(b), which provides that “[n]o discovery or deposition shall be permitted which . . . (b) would cause unreasonable annoyance, embarrassment, oppression, burden or expense to the deponent or any person or party . . . .”   Judge Wettick reasoned that a court order that gives an opposing party access to another’s non-public Facebook page “is intrusive because the opposing party is likely to gain access to a great deal of information that has nothing to do with the litigation and may cause embarrassment if viewed by persons who are not “Friends.”   Because such discovery is intrusive, it is protected by Rule 4011 “where the party seeking discovery has not shown a sufficient likelihood that such discovery will provide relevant evidence, not otherwise available, that will support the case of the party seeking discovery.”

However, Judge Wettick did acknowledge that the level of intrusiveness for a Facebook page, containing information made available to others who have no obligation to keep it confidential, is likely to be low.  Therefore, someone seeking to obtain such information will only need to show that the discovery “is reasonably likely to furnish relevant evidence, not available elsewhere, that will have an impact on the outcome of the case.”

Applying this reasoning to the facts of the case before him, Judge Wettick found that neither party had shown sufficient need for discovery of each other’s non-public Facebook pages.   Plaintiff was not entitled to the information because defendant had already made admissions in response to requests for admissions that made the request for Facebook content unnecessary, and defendant was not entitled to the information because the photos from plaintiff’s public page did not contain any information that suggested plaintiff’s personal injury claims were called into question.

With this opinion, Judge Wettick is informing litigators that while he is not opposed to permitting discovery of non-public social media, parties need to show that the social media that a person otherwise assumes is directed solely to a limited audience, i.e. their “friends,” is reasonably likely to be relevant to the claims in the case and is not available elsewhere.  In short, Judge Wettick attempts to balance a person’s privacy interests with those of a party seeking to prove or defend his or her case.

So far, no other courts have cited Judge Wettick’s opinion.  We will continue to watch for Pennsylvania court opinions following or rejecting Judge Wettick’s approach and for any rulings from the Pennsylvania appellate courts on the issue of discovery of social media.

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Posted in e-Discovery, Technology

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Popular Reality Television Show Deals With Trademark “Situation”

Posted on September 20, 2012 by | Comments Off on Popular Reality Television Show Deals With Trademark “Situation”

By: Robert M. Palumbi, attorney at Picadio Sneath Miller & Norton, P.C.

When we think of the typical reality television show today, we are generally focused more upon the outrageous conduct of the characters rather than the implications of the onerous terms of the contracts between the cast and company. However, intellectual property rights are currently directly in dispute between Michael “The Situation” Sorrentino and MTV owner Viacom over trademarks to the phrases he uses on the show “Jersey Shore.”

A trademark generally refers to a distinctive sign or indicator used by an individual or company in order to identify their products and services to the public, usually through a logo or brand. Using a trademark without the permission of the owner in certain products which may be similar or dissimilar would constitute trademark infringement, allowing the owner of a registered trademark to institute legal proceedings against the infringer.

Sorrentino has claimed in the past that many of the catch-phrases he uses on the show were developed prior to filming, with the intention of using such phrases in the show and later asserting trademark rights. On August 22, 2011, Sorrentino, through his company, MPS Entertainment, filed a registration with the Trademark Board for the term “twinning”, with the intent to use the phrase on t-shirts. On August 15, 2012, MTV owner Viacom filed papers at the Trademark Trial and Appeals Board stating that it owned any and all catch-phrases that Sorrentino develops on the show.

So what is Viacom’s basis for such a position? It can all be traced back to the oppressive Participant Agreement Sorrentino signed with the studio that produced the original “Jersey Shore.” In that Participant Agreement, Sorrentino waived the rights to “all ideas, gags, suggestions, themes, plots, stories, characters, characterizations, dialogue, text, designs, graphics, titles, drawings, artwork, digital works, songs, music, photography, video, film, and other material whether or not fixed or reduced to drawing or writing, at any time heretofore or hereafter created or contributed by me which in any way related to Jersey Shore.”

Nonetheless, this was just the original contract between the parties. After the show became popular, Sorrentino and Viacom signed an amended contract which reasserted the above rights, adding “The above language shall not be construed to grant to Artist or otherwise allow Artist the right to issue t-shirts featuring Artist’s quotes from the series.” Viacom followed this up with an additional provision that states “The above language shall not in any way limit any previous grant of rights to the Producer.”

Based upon this Participation Agreement, Viacom stated in papers filed with the Trademark Trial and Appeals Board that “Under the terms of the Participant Agreement Form, all rights in any intellectual property relating to Jersey Shore belong to 495 Productions Inc., the production company which creates the programs in the Series, which in turn assigned those rights by separate contract to Remote Productions Inc., a wholly owned subsidiary of Viacom. Therefore, Viacom is the rightful owner of all rights in and to the “twinning” mark and slogan.”

These developments highlight the carelessness of individuals who are explicitly willing to sign away their personal rights just for a chance at becoming a celebrity. Production companies are well aware of this phenomenon, and seemingly are in a position of power when proposing terms. However, this doesn’t mean that Sorrentino was permanently placed in such a position; remember, he did sign an amended contract. Perhaps a smarter way to deal with such a situation would be the path Karen J. Connelly took in her 2005 case against ValueVision Media. (Connelly and S.Y.K., LLC v. ValueVision Media, Inc. d/b/a ShopNBC, 393 F. Supp. 2d 767 (D. Minn. 2005).

Connelly worked as a television program host of the corporation, and her initial contract was similarly as oppressive as Sorrentino’s, forcing her to sign away all “inventions, innovations, or improvements in the method of conducting Employer’s business or otherwise related to Employer’s business, including new contributions, improvements, ideas, and discoveries, whether patentable or not or otherwise protectable by copyright, trademark, common law or trade secret law.” However, as Connelly grew in popularity, she also had an opportunity to sign an amended contract, which did in fact in retain some trademark rights. Perhaps if Sorrentino would have taken advantage of his opportunity to sign an amended contract he wouldn’t be in the situation he finds himself in.

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Patent or Trade Secret — Which One to Choose?

Posted on August 24, 2012 by | 1 comment

by: Robert Wagner, intellectual property attorney at Picadio Sneath Miller & Norton, P.C. ()

There was an interesting article on CNBC yesterday that highlights a popular misconception people have regarding how to protect their ideas and innovations. While people often think of using patents to protect their ideas, the law provides a number of different mechanisms (such as trade secrets) that can often be far more useful and valuable than patents. The article highlights how some of the most valuable intellectual property in the world, such as the Dr. Pepper formula, KFC’s “Secret Recipe of 11 Herbs and Spices,” and the formula for WD-40, is not patented, but is instead protected as a trade secret.

Both patents and trade secrets provide important protections for an individual’s or company’s innovations, but they protect them in very different ways. Patents generally entitle an inventor to the exclusive right to make, use, and sell the invention described in the claims of the patent for a 20-year period from the date the patent application is filed. As part of the quid pro quo for obtaining this government-sanctioned exclusive right, the inventor must describe how to make or use his or her invention in sufficient detail that a person in that field would be able to make or use the invention without significant difficulties. Once that 20-year period expires, anyone is free to use that invention.

Trade secrets, on the other hand, potentially can last forever and the law will prevent others from improperly taking or using the invention, as long as the individual or company takes sufficient steps to keep the invention secret. Thus, a former employee who happens to know the secret will not be allowed to make the product in competition with the inventor, or a competing company cannot use industrial espionage to steal the secret. The law does not prevent another from using the secret if the person independently and lawfully discovers the same invention on his or her own, though. It only protects the inventor from others who have improperly discovered or used the secret.

From these brief descriptions, it is clear that patents better protect some kinds of inventions, while keeping the invention a trade secret may better protect others. For instance, it may make more sense to consider patenting the invention when the innovative aspect of an invention is readily seen simply by looking at a product (such as with a paper clip or a pop-top soda can).  The law will protect the inventor from anyone else making or selling the same invention for 20 years, even if that other inventor independently came up with the same idea. Trade secret protection is likely of little to no value in this case, because once the invention is sold, everyone knows what the invention actually is.

On the other hand, inventions such as the Dr. Pepper formula are not easy to determine, even when you have a can of Dr. Pepper in your hands. The precise ingredients and the process by which they are blended are not apparent. This kind of invention lends itself to being kept as a trade secret because the invention is not easily reversed engineered. If Dr. Pepper had chosen the patent route instead, it would only have had an exclusive right to make and sell the soda only for 20 years, after which everyone could make exactly the same product. By protecting it as a trade secret, it potentially can keep its invention a secret forever.

One of the keys with trade secrets is that the inventor must take reasonable and active steps to keep the invention secret. As the article mentions, many of these companies restrict knowledge of the complete formulas or processes to only a handful of individuals and take steps make sure that the products are manufactured in such a way that no one can determine what the recipes are. If an inventor does not take steps to keep his or her invention secret, the law will not do it for him or her.

Obviously, both patent and trade secret law are far more complex than what is discussed here. However, the basic principles are useful to understand so that the right questions can be asked and the right strategies considered when deciding how to protect your secrets and inventions.

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The Dangers of Misleading Press Releases

Posted on August 21, 2012 by | Comments Off on The Dangers of Misleading Press Releases

by: Robert Wagner, intellectual property attorney at Picadio Sneath Miller & Norton, P.C. ()

When a patent holder sues a potential infringer, the question often comes up about what the patent holder can publicly say about the lawsuit, either to its customers or in press releases. A recent blog post by Scott Daniels in the Reexamination Alert Blog and cross-posted at IPWatchdog shows the problems one company found itself in when it issued press releases that the other side felt went too far.

Background

TASER International (which makes numerous products, such as the famous TASER stun gun) sued Stinger Systems for infringing some of TASER’s patents and for false advertising. While the false advertising claims were resolved by a joint stipulation, the court ultimately found that Stinger infringed one of TASER’s patents.

In response, Stinger filed its own lawsuit against TASER the week before TASER issued its quarterly earnings report, claiming that TASER engaged in false advertising, unfair competition, and injurious falsehood arising out of a study by the National Institute of Justice (“NIJ”) that TASER circulated. Stinger waited until the day of the earnings report to announce the lawsuit in a press release, but never actually served TASER. Later, Stinger voluntarily dismissed the lawsuit after receiving an order to show cause.

Contending that the press release and lawsuit were shams designed to harm TASER’s stock and business, TASER brought another lawsuit against Stinger—Taser International, Inc. v. Stinger Systems, Case No. 2:09-cv-289, in the United States District Court for the District of Nevada—alleging a number of claims, including violations of the Lanham Act. Judge Miranda Du issued an opinion on August 3, 2012 deciding the parties’ partial summary judgment motions on the Lanham Act claims (among other things).

In it, the Court refused to grant summary judgment in favor of Stinger on the claims related to Stinger’s press releases. The Court found that TASER had presented sufficient evidence that the allegations that the press releases were false and misleading could go to the jury.

In particular, the Court noted four issues of fact that prevented granting Stinger’s motion. First, Stinger claimed in its press release that it had served TASER with the lawsuit when it had not. Second, the press release did not adequately explain what the NIJ is and what its report contained. Third, there was evidence that suggested that Stinger “wanted to pursue misleading press releases as an avenue for devaluing TASER.” And, fourth, there were telephone recordings suggesting that the litigation was designed to be vexatious and to drive down TASER’s stock.

Take Aways

While this case is more extreme that most cases, it still serves as an important reminder that the filing of a lawsuit does not give a party a license to say anything it wants. Press releases need to foremost be truthful and provide sufficient context for the statements contained in them, especially those statements that might be viewed as impugning another.

As this case shows, courts will look sometimes look behind the statements to the motivations of the speakers in determining whether the statements are actionable or were intended to mislead others.

As tempting and satisfying as it may be to issue strong press releases, companies and individuals need to take care that the press releases do not themselves become the subject of additional litigation or distract from the legitimate claims an individual is trying to make.

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Posted in Lanham Act

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Rogers v. Tristar Products–Federal Circuit Dismisses Pending Patent False Marking Appeal

Posted on June 7, 2012 by | 1 comment

by: Robert Wagner, intellectual property attorney at Picadio Sneath Miller & Norton, P.C. ()

When President Obama signed the Leahy-Smith America Invents Act, H.R. 1249, 112th Cong. (1st Sess. 2011), the patent false marking claims that had become so popular were essentially eliminated. Whereas before anyone could bring such a claim, regardless of whether they had actually suffered any injury, now only those who have “suffered a competitive injury” as a result of a violation of the marking statute have standing to sue. (See 35 U.S.C. § 292). The America Invents Act not only prohibits persons who have not suffered a competitive injury from suing in the future, it also divests the standing of plaintiffs in pending false marking cases from continuing to pursue those claims.

In Rogers v. Tristar Products, Inc., 2011-1494, -1495, the Federal Circuit had to decide if that divestment included cases on appeal, as well as cases current pending in district courts. After considering the clear language in the newly amended 35 U.S.C. § 292—“The amendments made by this subsection shall apply to all cases, without exception, that are pending on, or commenced on or after, the date of the enactment of this Act”—the Federal Circuit determined that all cases must be dismissed, regardless of where they were pending or what procedural posture they may be in, unless the plaintiff could demonstrate that it had suffered a competitive injury.

The Federal Circuit rejected plaintiff’s assertion that he had a property right in maintaining such a claim or that the retroactive elimination of his claim violated the Due Process Clause. The Court found that Congress had a legitimate justification for eliminating these types of claims and rationally made the requirements retroactive.

The America Invents Act has effectively eliminated the nascent cottage industry of individuals suing companies for leaving expired patent numbers on its products. Companies no longer need to fear that they will be sued in such circumstances by individuals who likely have never used the products in question. Despite this, companies still need to be concerned about monitoring their products to make sure that they are appropriately marked. In the high stakes of patent litigation, defendants are still likely to look at whether they can bring false marking counterclaims if they are sued. As a competitor, it will be far easier (although by no means certain) to establish a competitive injury.

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Public Domain May Not Be So Public After All–The Warner Bros. v. X One X Decision

Posted on July 7, 2011 by | 1 comment

by: Robert Wagner, intellectual property attorney at Picadio Sneath Miller & Norton, P.C.

Materials that have fallen into the public domain should be free of any claims of copyright infringement, right? Not so fast says the Eighth Circuit. As with many issues surrounding copyright law, the answer is not so clear cut. It depends on whether other copyrights exist and how one uses the public domain materials in relation to the other copyrights.

In Warner Bros. Entertainment, Inc. v. X One X Productions (No. 10-1743), Warner Brothers sued a number of defendants for allegedly infringing its copyrights in characters and images from the films Gone with the Wind and The Wizard of Oz, as well as numerous short films featuring the cartoon characters “Tom & Jerry.”

Studio Releases Marketing Materials Without Copyright Notice

At the time of these movies’ release in 1939, the copyright laws required that materials be marked with a copyright notice in order to gain the protection of the copyright laws. Materials that failed to comply with the notice requirements of the 1909 Copyright Act in effect at that time forfeited any copyright protections and fell into the public domain. Prior to releasing the films, the studios distributed marketing materials (posters, photographs, lobby cards, etc.) with images of the actors in costume on the sets. None of these materials complied with the copyright notice requirements, and, thus, fell into the public domain. When the movies were released, the studio properly marked the movies and continues to hold a valid copyright in them.

Defendants used these public domain images on shirts, lunch boxes, music box lids, playing cards, and three-dimensional models and figurines. In some cases, defendants added features to the images, such as signature phrases from the movies, or combined the images to create new scenes, sometimes reminiscent of scenes from the movies.

Warner Brothers Sues for Copyright Infringement

Warner Brothers sued, arguing that defendants were only entitled to reproduce the public domain images in their entirety and in the same form without any modifications (i.e., only reproduce the posters as posters). Anything else, it argued, violated its copyrights in the movies and the right to create derivative works.

The Eighth Circuit agreed that the underlying images from the marketing materials were in the public domain, but found that the use of those materials was limited by other copyrights.

In other words, if material related to certain characters is in the public domain, but later works covered by copyright add new aspects to those characters, a work developed from the public domain material infringes the copyrights in the later works to the extent that it incorporates aspects of the characters developed solely in those later works.

The Court then looked at the original books, the movies, the public domain materials, and the defendants’ products to see whether defendants’ use infringed Warner Brothers’ copyrights. In particular, the Court looked to the images in the marketing materials and found that the visual appearance was not sufficiently consistent to have thrown the characters themselves into the public domain by virtue of the release of the marketing materials. Instead, the Court found that only the exact images were in the public domain.

Eighth Circuit’s Holding

Taking this all together, the Eighth Circuit found that defendants were not limited to merely reproducing the public domain materials in exactly the same form as they originally existed. Instead, it found that defendants could reproduce any portion of the public domain materials in any two-dimensional format they chose.

The Court did prohibit defendants from combining public domain images into a new composite work, though. This, it felt, created a “new increment of expression of the film character that was not present in the separate images” and, therefore, infringed Warner Brothers’ copyrights. Similarly, the Court prohibited defendants from taking the two-dimensional images and recasting them in three-dimensional form. This too created a new increment of expression that violated Warner Brothers’ copyrights.

What Does This Case Mean?

The takeaway from this case is that there are no simple answers when it comes to materials that are both copyrighted and in the public domain. One has to look carefully at the facts of the case to determine the nature and scope of the materials in the public domain and in the copyrighted materials. For example, do the public domain materials convey properties and characteristics of the characters or are they just isolated images? How much is in the public domain versus how much is still copyrighted? Has the copyrighted material added anything over the material in the public domain?

While not a complete victory for the studio, Warner Brothers obtained much of what it wanted in this case. Defendants cannot create new works based on the material in the public domain. Instead, they are limited to reproductions (either in full or in part) of the public domain material. It will be interesting to see if either side tries to appeal this decision to the Supreme Court.

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