Attorney Jordan Mogensen published a blog post in February 2018 on De Novo, a forum through which the staff, editors, and alumni of the Minnesota Law Review can contribute to legal thought and academic debate. Jordan’s post dives into the Fifth Amendment considerations of utilizing the fingerprint password capability of modern cellphones. The Minnesota Supreme Court is the first state supreme court to address this issue, but their decision will likely affect “citizens of other states as the issue is considered more broadly.”

To read the full post, click here.

March 28, 2019—The saltiest trademark news in the last week surrounds singer Cardi B’s application to register the marks “Okurr” and “Okurrr,” both slang for “Okay???”–but pronounced in a hip, rolled-r trill, sometimes with a shady tone. Or, as Cardi describes, it: the sound of a “cold pigeon in New York City.” If you haven’t heard it said before, search no further than these humorous and fully-extra renditions by a few popular drag queens:

As with most seemingly-overreaching trademark applications, Cardi’s registration of these popular words–particularly in the drag queen community–has been met with criticism. The public backlash is understandable; it brings to mind the concern that trademarking a term will take it out of the public domain and inhibit free speech and fair use. Though, to be fair, Cardi’s applications only seek to preclude use of the word on clothing and merchandise. But she acknowledges the registrations are, essentially, a cash grab.

Indeed, trademarking common words appears to be a regular strategy for celebrities seeking to capitalize on words’ popularity. I’m reminded by the recent example of singer Will.I.Am attempting to trademark the phrase “willpower,” which was cancelled by the Trademark Trial and Appeal Board because the mark was too similar to other existing marks and had no source-indicating distinctiveness. That is, the public did not strongly associate the word “willpower” with Will.I.Am, so Will.I.Am cannot claim exclusive use of the mark in commerce. But Cardi argues that “Okurrr” has become her famous slogan, buoyed by a Superbowl Pepsi ad featuring her using the phrase and instructing others on how to pronounce it correctly.

And that brings me to the “T”–the truth–of the enforceability of Cardi’s registrations: it is unlikely that the general public would identify Cardi as the source of goods beat with “Okurrr” or similar marks because, in fact, “Cardi can’t honestly make the argument that she created the word.” Rather, according to the fiercest drag queen of them all, RuPaul, the credit goes to Broadway actress Laura Bell Bundy–even though RuPaul and other drag queens brought the phrase, which may have roots in African-American culture, to the runway, where it was picked up by the Kardashians and, now, Cardi B.

The contextual history of Okurrr is important and cannot be overlooked in the distinctiveness and goodwill analysis. It not only undermines Cardi’s legitimate claim to exclusive nation-wide use of the mark in commerce, but also seriously calls into question the appropriateness of restricting use of the word by all others, including the communities from which it originates–and which much of the public likely identify as earlier or actual sources of the word. Thus, trademarking “Okurrr” is likely to lose from both a legal and PR standpoint. That’s a sickening realness, but not in a “feeling the fantasy” kind of way.

Whether Cardi’s tuck-under will be allowed to stand, or the gag will be up, remains to be seen. At least one drag queen, Alaska, who is also known for her rendition of “Okurrr,” plans to clock Cardi’s conduct, potentially by challenging the registrations in court. Time will tell whether Cardi’s gambit will stay, or be asked to “sashay away.”

March 13, 2019—If you have heard of Penn State, you have probably heard the phrase “Happy Valley.” The school, the students, and the media regularly use “Happy Valley” in reference to the school and the surrounding community. The school considers the association so strong that Penn State recently applied to register HAPPY VALLEY as a trademark for clothing – and received a refusal to register.

The Trademark Office examining attorney assigned to the application refused registration on the ground the phrase “Happy Valley” is geographically descriptive. This means that the examining attorney concluded the public will see the phrase simply as describing the geographic area where the school is located. The school’s own website seems to confirm the examining attorney’s concerns, as it describes “Happy Valley” as an “also known as” name for the town, State College.

But don’t worry Penn State fans. The university has a strong chance to overcome the refusals so long as Penn State can demonstrate the HAPPY VALLEY trademark has acquired distinctiveness in the minds of consumers. Marks that may initially be considered geographically descriptive or may become distinctive after sufficient use of the mark in commerce.

For example, use of a trademark for five years or longer may be sufficient to overcome a refusal on this ground. In fact, the examining attorney expressly references this option in the Office Action. Accordingly, chances are good Penn State can overcome this refusal simply by submitting a declaration that the university has used the mark in commerce for more than five years. However, the Trademark Office will also consider other evidence such as widespread advertising efforts, significant sales numbers, and substantial media attention and publicity.

As a fellow alum of a Big Ten university (which university isn’t important), I wanted to provide some assistance in gathering evidence in support of Penn State’s potential claim of acquired distinctiveness for the HAPPY VALLEY trademark.

If you’ve heard of Penn State, you know they receive a lot of publicity for their college sports teams. For example, this ESPN article prominently uses HAPPY VALLEY to refer to Penn State with its headline “Iowa silences No. 5 Penn State in Happy Valley.”

The Penn State wrestling program is also among the best in the country. Historically, the Happy Valley-based wrestling squad has the third-most successful program in the country, with 8 (!!) NCAA national championships, just slightly trailing Iowa’s 23 national championships.

Last, but certainly not least, Penn State can point to a visit last month from the Big Ten Tournament Champions and presumptive NCAA ’s basketball player of the year Megan Gustafson. Yet again Penn State received some great publicity associating the claimed HAPPY VALLEY mark with the University, as media ran with the headline “Iowa Cruises in Happy Valley.”

With all this evidence, Penn State fans should feel good about the likelihood they’ll soon be able to purchase HAPPY VALLEY t-shirts with a ® symbol adjacent to the phrase (exclusively from a licensed retailer). Of course, if they need more evidence, I’m sure I can find some fellow Big Ten organizations that would be happy to add some new headlines in 2019.

March 7, 2019—A little over one year ago, I blogged about Tesla’s Roadster being launched into outer space, asking who owns the right to the “Spaceman” rider’s mark? Today, I post a different thought-provoking question about electric car company Rivian: Does Rivian’s use of a Ford F-150 body when testing its electric truck technology in public risk trade dress infringement?

If you haven’t seen the recent headlines, startup electric truck company Rivian has been testing its 100% electric truck technology under the hood of a Ford F-150 body:

Credit: AutoBlog

In these photos of a Rivian masquerading as a Ford at an electric charging station, you can make out the modified chassis underneath. You might also notice there are no tailpipes, and the wheels seem just a little too small. Surprisingly, the Ford logo is still present on the truck body in both the front and back, along with the F-150 mark on the side. I sure hope Rivian has a licensing agreement…

Compare the above look to the distinct headlight and sleek design advertised by Rivian:

Credit: Jalopnik

For the past few months, consumers have been reporting sightings of strange F-150s with missing features, speculating that the trucks might be prototypes for an electric Ford. Here’s another example of one seen in the wild, although it’s unclear whether this is a genuine Ford electric prototype:

Credit: AutoBlog

However, recently Rivian CEO R.J. Scaringe confirmed that the company has been secretly testing its “skateboard” chassis architecture underneath Ford F-150 bodies on public streets. And he also suggested the company may be testing under other masks: “They’re all over the place, but nobody knows. We’re very quiet about that.”

When I learned about Rivian’s clever camouflaging, it immediately brought to mind trade dress protections. The Lanham Act protects a product’s design, shape, and configuration when such features serve as distinctive identifiers of the product’s source. Note, however, that functional aspects of trade dress are not protected–only ornamental features are. Just like trademark infringement claims, to prevent others from using a specific trade dress, the plaintiff must show that the use is likely to cause confusion. The Lanham Act also protects against trade dress dilution, which includes weakening of the distinctiveness or fame of trade dress or use of trade dress in connection with inferior products. In either case, the plaintiff can seek both damages and an injunction barring further infringement and dilution.

Arguably, Rivian’s masquerading as a Ford F-150 risks liability for trade dress infringement, as well as dilution. As to infringement, there are already reports of confusion on the streets. Though, the harm from infringement is probably minimal because Rivian is not selling any counterfeit electric F-150s.

Rivian’s use of the Ford F-150 body may also dilute the distinctiveness of the F-150’s overall design and Ford’s marks. Indeed, with knowledge of Rivian hiding under the hoods of F-150s, consumers and commentators may be starting to wonder if the F-150s on the road were actually made by Ford. And depending on your view of electric vehicles, use of the Ford and F-150 marks, in addition to the model’s trade dress, could be seen as use in connection with inferior, unrefined products. On the other hand, if you’re like me and are excited about electric vehicles, the use could elevate Ford and the F-150’s overall image to high-tech chic.

But Ford would likely face an up-hill battle arguing the F-150’s trade dress is famous enough to be entitled to protection from dilution. In fact, it appears Rivian chose the F-150 body precisely because it is ubiquitous and generic enough that hiding under it would likely not draw attention. Moreover, Rivian could argue its use of the F-150 trade dress is fair, and therefore statutorily protected, because Rivian is not using the trade dress to designate itself as a source. Rivian’s use also doesn’t seem to fit the mold for what is typically considered “commercial” (or transactional) use. On the other hand, Rivian could probably take simple steps to modify the body of its testing vehicles to reduce the trade dress risks created by its masquerade.

February 14, 2019—You might recall that several months ago, we blogged about an intriguing trademark infringement battle between Buc-ee’s and Choke Canyon. In June 2018, the Texan rivals competing in the over-sized gas station market–a real niche, to be sure–went to trial, with Buc-ee’s arguing that Choke Canyon’s alligator logo infringed Buc-ee’s beaver mark:

Incredibly, the Texan jury found in favor of Buc-ee’s. The jury also found that Choke Canyon’s alligator mark diluted (a/k/a “blurred”) the distinctiveness of the beaver mark. However, the jury did not explain why the alligator mark infringed and blurred Buc-ee’s marks. As my colleague Tim Sitzmann previously reported, Buc-ee’s contended the alligator blurred and infringed for at least five reasons:

(i) the use of a black circle encompassing the alligator, (2) use of a yellow background, (3) use of the red-colored tongue of the alligator, (4) prominent use of sharply drawn black edges for the alligator mascots, and (5) the use of letters in raised block font in the name “CHOKE CANYON.”

After the jury verdict, Buc-ee’s moved for a permanent injunction, asking the court to order Choke Canyon not to use, and to remove, a host of similar logos. Here’s the major update: the district court granted Buc-ee’s proposed order almost in its entirety, requiring Choke Canyon to, among other things, stop:

a. any and all sale, offering for sale, distribution, or advertising in connection with the Choke Canyon Logo or any colorable imitation of Buc-ee’s Logo;
b. any and all use of the Choke Canyon Logo…on any labels, signs, prints, packages, wrappers, etc.;
…
e. using the Choke Canyon Logo…on any webpage or websites;

The judge also ordered Choke Canyon to remove any and all viewable alligator logos within 45 days. For a full copy of the permanent injunction order, click this link.

The Buc-ee’s v. Choke Canyon case is a rare glimpse into what happens after a trademark victory in federal court. Over 97% of cases are dismissed or settle before trial, and even fewer receive permanent injunctions. Indeed, Buc-ee’s itself recently suffered defeat in a trademark case against Bucky’s convenience stores based in Chicago. You can’t win ’em all, I guess; the road to gas station “world domination”isn’t so easy after all.

To answer the question posed in the graphic: perhaps not. 

After the court issued its permanent injunction, Choke Canyon filed a status update reporting on its compliance and documenting its efforts to remove or limit the viewability of the alligator mark. Included in its submission were numerous photos of Choke Canyon’s new mark:

Texan gas stations sure do like to put their logos on everything, everywhere. This makes them designed for maximum exposure, and (if sued for infringement) maximum potential liability. Here’s a blow-up of the new logo next to Buc-ee’s:

I cannot help but wonder how a jury would view a trademark suit involving this new mark. Again, the jury never provided any explanation for their finding that the alligator mark infringed and blurred the beaver mark. The new mark has three of the five points of similarity Buc-ee’s previously argued made the alligator mark unlawful (no red tongue and yellow background here). The orange background, while a different color, is only a shade away. And the character is still wearing a hat (and now includes a similar color, red, in a stripe). In addition, the color of the cowboy’s hair is similar to the beaver’s brown fur. Both are smiling. Both have at least one eye open. Both have round noses.

Despite their similarities, a critical difference is that Buc-ee’s is a beaver, and the new logo depicts a cowboy–though, I thought an alligator was readily distinguishable from a beaver. The cowboy is also facing the viewer head-on, rather than in profile. Overall, the appearance is quite different, seemingly more than than the alligator. Facially, it would seem strange for consumers to confuse Choke Canyon with Buc-ee’s. So perhaps Choke Canyon is in the clear. What do you think? Is the new cowboy a “colorable imitation” of Buc-ee’s beaver?

January 18, 2019—They say one Bad Apple can spoil the bunch. But what can a Happy Apple do? It depends on which one you buy, but you’ll want to make sure you’ve got the right Happy Apple.

One Happy Apples brand involves fresh apples, apple cider, and caramel apples.  The other Happy Apple is a cannabis infused drink. Sure, the names are nearly identical, but does the candy apple company have a viable trademark infringement claim against the cannabis drink company? A recent ruling from the Western District of Washington involving this dispute suggests that brand owners may have an uphill battle enforcing their rights against the expanding cannabis industry.

For your consideration, a sample of the companies’ respective products is shown below.

The Happy Apple Company sued Tarukino, LLC (the producer of cannabis beverage) and requested a preliminary injunction. Notwithstanding the fact that both companies were using the nearly identical HAPPY APPLE wording, the court denied the request in an order issued January 9, 2019. In denying the request, the court’s reasoning, if adopted by other courts, could make it more difficult for brand owners to enforce their trademarks against cannabis products.

The court acknowledged that “both products are apple-related but the similarities end there.” When evaluating a claim of infringement, courts rely on a number of factors to determine whether there is a likelihood of confusion. In Washington (part of the Ninth Circuit), the courts follow the Sleekcraft factors.

As part of the analysis, courts look at how similar the marks are as they appear in the marketplace. This means even though the parties use HAPPY APPLES and HAPPY APPLE, the court looks at all of the packaging, including the font used, design elements, presence of house marks or company names, and other information. These facts seemed significant to the decision, as the judge concluded:

While they both contain the words “happy apple” they look markedly different. The mark used by Plaintiffs uses a different font and includes a cartoon of a caramel apple. The product sold by Defendants includes a picture containing two arrows, an apple, and the words “cannabis infused”, similar to a coat of arms.

Notably, the court appears to have only focused on the packaging for the caramel apple. Neither the cider nor the fresh apples include a carton of a candy apple. If I’m being honest though, the cartoon apple on the packaging looks like it may have had a bottle or two of the other Happy Apple.

The court also relied heavily on the significant regulation of cannabis products under Washington state law, reasoning:

cannabis-containing beverages can only be distributed and sold by retail stores licensed and regulated by the Washington State Liquor and Cannabis Board. These retail stores may only sell marijuana, marijuana concentrates, marijuana-infused products, and marijuana paraphernalia. Defendants’ products and Plaintiffs’ products are not likely to be sold in close proximity to each other, and it is unlikely that a purchaser would mistakenly enter a retail store selling marijuana or marijuana-related products and confuse a cannabis-containing apple beverage with the fresh apples, apple cider, or caramel apples sold by Plaintiffs.

At first glance, it seems that the court may be unfairly narrowing the likelihood of confusion as to whether a consumer might confuse the two products. While such a purchase would certainly qualify as consumer confusion, it is not the only type of consumer confusion. Consumer confusion can also occur if a consumer mistakenly believes that there is some type of connection, sponsorship, or other relationship between the Happy Apple cannabis product and the owner of the HAPPY APPLES brand. For example, whether a consumer might mistakenly believe the apples used to make the cannabis beverage were HAPPY APPLES brand apples.

Perhaps the court concluded the highly regulated nature of the industry and the distinctly different channels of trade were simply enough to avoid a likelihood of confusion, especially when comparing how the marks appear in the marketplace.

However, if the highly regulated nature of cannabis products truly carried the day for the defendant, it does not bode well for other trademark owners. All states that have legalized cannabis in any form have maintained strict regulation on how and where such products can be sold. If other courts adopt this court’s analysis, cannabis company defendants arguably begin any trademark infringement lawsuit with a loaded deck.

Of course, this is only a ruling on a preliminary injunction request, not a ruling of non-infringement. It is also possible the court relied on a number of other factors that simply were not referenced in the order. The HAPPY APPLE mark is not necessarily a strong mark, and certainly not well-known like HERSHEY’S or REESE’S. The term APPLE is either generic or descriptive, depending on the context, and HAPPY may not be entitled to a broad scope of protection.

As the cannabis industry continues to grow, there will undoubtedly be many more lawsuits. This is just one of many data points non-cannabis companies must use to determine where to set their trademark enforcement goal posts, and a data point for cannabis companies to use when evaluating new names and trademarks.

January 17, 2019—From time to time, I post squirrelly thoughts. Today, I wonder: Should a large company with famous, distinct trademarks sometimes hold back from aggressively enforcing those trademarks, even when doing so might at first appear to be a useful competitive strategy? I’m sure many executives at McDonald’s–the worldwide fast-food chain that it is so ubiquitous The Economist uses the prices of the Big Mac to measure purchasing power parity throughout the world–are questioning some past enforcement decisions.

If you haven’t heard, the European Union Intellectual Property Office (EUIPO) issued a decision cancelling McDonald’s “Big Mac” trademark registration within the European Union. Although the decision was based on certain procedural and evidentiary issues, it resulted from a proceeding brought by McDonald’s European competitor “Supermac’s,” an Irish fast-food burger chain opened in 1978, in response to McDonald’s aggressive enforcement tactics.

Supermac’s offers a similar cornucopia of comfort food items, including chicken nuggets, french fries, and the “Mighty Mac,” which is:

A succulent double burger complete with two 100% Irish beef patties, melted cheese, crispy lettuce, diced onion with ketchup and burger sauce served in a toasted sesame seed bun.

Sound familiar? Here’s how McDonald’s describes the Big Mac:

Mouthwatering perfection starts with two 100% pure beef patties and Big Mac sauce sandwiched between a sesame seed bun. It’s topped off with pickles, crisp lettuce, onions and American cheese for a 100% beef burger with a taste like no other. It contains no artificial flavors, preservatives or added colors from artificial sources. Our pickle contains an artificial preservative, so skip it if you like.

Perhaps for these reasons, McDonald’s vigorously opposed Supermac’s trademark registrations a few years ago, arguing that the similarity between the names “McDonald’s” and “Supermac’s” (the Mc/Mac usage) would cause confusion among consumers.

Which one is the Big Mac, and which is the Mighty Mac? (hint: in order)

In 2017, Supermac’s retaliated against McDonald’s enforcement activities, seeking cancellation of McDonald’s own flagship marks. Central to Supermac’s narrative is McDonald’s “trademark bullying”–a topic we’ve discussed generally on DuetsBlog numerous times. Specifically, Supermac’s argued that McDonald’s purposefully engaged in anticompetitive conduct, including “registering brand names . . . which are simply stored away in a war chest to use against future competitors.”

It is not readily apparent that EUIPO ruled against McDonald’s on grounds related to bullying or overly-aggressive enforcement because, ostensibly, the ruling is based on McDonald’s failure to prove genuine use of “Big Mac” as a burger or restaurant name–which seems hard to believe given, among other things, The Economist’s Big Mac Index. However, Supermac’s is calling this a victory for small businesses, and a win in “a David versus Goliath battle against trademark bullying by a powerful multinational.” As a result of EUIPO’s ruling, companies may now freely use “Big Mac” throughout the entire EU. McDonald’s has said it intends to appeal the ruling.

EUIPO’s ruling seems absurd, but it makes me wonder if McDonald’s could have avoided this ruling, and the trademark bully label, by taking a less aggressive stance in enforcing its trademarks. Instead of seeking to prevent registration of the Supermac’s and other marks in a transparently-competitive posture, McDonald’s could have decided to target its enforcement on certain products and names (e.g., Mighty Mac), or simply compete on the basis of quality and price. McDonald’s could have also considered creative ways to discourage Supermac’s from using similar marks, employing humorous methods akin to Bud Light sending a medieval jester to deliver a cease and desist message on a scroll to Modist Brewing. Increasingly, brands need to seek a balance between uncovering and prosecuting all possible misuses and not enforcing rights at all. This latest EUIPO may, at its heart, be a lesson in more selective enforcement.

Update: This article was referenced, and Kyle was quoted by the Washington Post on February 11, 2019.

December 19, 2018—With the holiday season half way over, and Christmas less than a week away, you’re running out of time to bring some holiday cheer to those around you. Luckily, Chipotle, Taco Bell, and Jimmy Dean have your back and they’re ready to help you surprise and delight your food-obsessed friends and family this Christmas.

Perhaps your spouse just can’t get enough burritos from Chipotle? Well, how about Chipotle-branded guacamole, salsa, or tin foil wrapping paper on their gifts?

Or maybe your childhood memories are filled with the scent of a hearty breakfast on Christmas morning at your grandparents’ home. I’m sure your grandma or grandpa would be giddy with excitement when their gift comes wrapped in this sausage scented Jimmy Dean wrapping paper.

If your best friend is more into Taco Bell. You could go all out and build a tower of gifts, with guacamole, cheese, and the rest of the ingredients filling your gift stack wrapped from top (tortilla) to bottom (tortilla).

In today’s age of social media and cable cutting, creative marketing efforts like the above could encourage and deepen brand loyalty among consumers. It’s also a whole lot of free advertising as consumers share this content on social media platforms like Twitter, Instagram, and Facebook. In fact, the Taco Bell CrunchWrapping paper apparently reached #16 on Amazon Canada’s Best Sellers list before it sold out, so the preliminary results suggest the campaign was a success. With this success, it would not be surprising to see more brands join in on the fun next year, so keep an eye out next November for 12 feet of high definition Arby’s roast beef!

December 14, 2018—Who comes to mind when I list the following character traits: lives in a dystopian metropolis, has a deceased parent, fights criminals, rides a motorcycle, has seemingly-superhero strength, is fearless, has dark hair, and–oh, by the way–his name is “Wayne.” More than that, you learn all these facts about Wayne by watching a trailer for a series about Wayne on YouTube, which informs you throughout that Wayne is a character “from the guys who wrote Deadpool,” a fictional superhero. Take a look for yourself:

It should probably come as no surprise that many people watching the trailer–myself included–thought this Wayne might be “Bruce Wayne,” the well-known secret identity of Batman. The comments to the official trailer demonstrate as much. Consider, for example, the “top comment” for the trailer:

The Bruce Wayne most consumers know is the wealthy orphan owner of Wayne Enterprises by day, crime-fighting superhero by night. YouTube’s Wayne shares many of the same traits (except, perhaps, the wealth), and one could certainly believe that the Wayne series might be an origin story for one of the most popular superheros of all time. Of course, by the end of the trailer, you get the impression that the Wayne you’re watching probably isn’t (though there’s no disclaimer):

In total there are over 7,200 comments for the trailer at the time of writing this post. Since the official trailer, YouTube has released additional teaser trailers for the series, each making it clearer that Wayne probably isn’t Batman. Yet, viewers still aren’t quite sure:

What I find interesting about these comments is that they are a readily-available (though perhaps unreliable) data set for proving, or disproving, the existence of customer confusion. Assume that DC Comics, the owner of the Batman mark and Bruce Wayne character (which does not appear to have been registered, but to which DC Comics could have common law rights and copyright protection) could sue YouTube for infringement or dilution. Arguably, the comments on the Wayne trailers show that consumers are drawing a connection between DC Comics and the Wayne series given the name, mood of the series, and common character traits with Batman. In this, YouTube may be free riding on Batman’s popularity. Depending on just how many comments reference Batman, the comments themselves could serve as strong quantitative data of confusion–akin to the kind of survey data usually used to prove that element of a trademark claim.

On the other hand, many of the comments for the series do not reference Batman or Bruce Wayne. Do non-references indicate a lack of confusion, or perhaps a confusion that is dispelled quickly after watching the trailers? This relates to the doctrine of “initial interest confusion,” which is temporary confusion dispelled before a sale or some other commercial harm, but still may be actionable because the party creating the confusion free rides on another’s mark to gain attention. Since widespread access to the Internet, initial interest confusion cases have increased tenfold, but courts disagree about the vitality of the rule. Regardless, that confusion appears to persist in this situation–as demonstrated by the comments for each new trailer–shows that the confusion here may be of the continuing and uncured variety on which many trademark claims are based.

Wayne fully releases on YouTube in January 2019. There do not appear to be any lawsuits pending at the moment. And there does not appear to be a “Wayne” trademark registration for the series. But if YouTube (or the series’ creators) file for one, DC Comics could oppose the registration–and has done so for similar marks in the past. We’ll keep you updated with any new developments!

November 16, 2018—Readers of this blog may recall that in the past year, I wrote extensively about the U.S. Supreme Court case of Oil States v. Greene’s Energy. But I paid little attention to another important case decided around the same time: SAS Institute v. Iancu. Oil States centered on whether the USPTO’s inter partes review (“IPR”) process (challenging a patent at the USPTO, rather than in court) was constitutional. SAS followed up with a seemingly less-pressing issue: whether, when the USPTO institutes an IPR to reconsider a patent by accepting an IPR petition, the USPTO must decide the patentability of all of the claims of the patent that the IPR petitioner challenged in the IPR petition. The Supreme Court ruled that IPR is constitutional in Oil States and that the USPTO must decide the patentability of all of the claims which were challenged in the accepted IPR petition in SAS.

Just this week, I attended a “Supreme Court Preview” event hosted by the Eighth Circuit Bar Association. One of the topics was upcoming patent cases before the Supreme Court. I’ll admit; they’re not as juicy as last term (but perhaps only lawyers would have salivated over last year’s cases). However, one gave me a squirrelly thought: Return Mail v. United States Postal Service. The major issue in Return Mail is whether the federal government is a “person” who may petition to institute review proceedings before the USPTO.

Credit: Channel 3000

Technically, Return Mail doesn’t involve IPR, but rather a different proceeding called covered business method (“CMB”) review. CMB review, as its name implies, is limited to review of business method patents–that is, patents that claim a method or apparatus for performing data processing or similar operations relating to the practice, administration, or management of a financial product or service. But CMB review is very similar to IPR; a person files a petition with the USPTO seeking review, and the USPTO decides whether to institute proceedings. For example, in the Return Mail case itself, Return Mail, Inc. sued the United States Postal Service (“USPS”) for infringement of a business method patent described as: encoding information about the name and address of intended recipients in the form of a barcode, returning undeliverable mail to a processing location, scanning the barcode, obtaining the corrected information, and then providing that information to the sender to choose whether to resend with correct addressee information. (Description in the Federal Circuit opinion.)

Credit: Postal Reporter

Does Return Mail’s patent seem a little…obvious? Sounds like USPS might have a good shot at challenging the patent via CMB review, right? That’s what the USPS thought, so it petitioned for CMB review of certain claims of the patent. There’s just one problem: current patent law says that only a “person” can institute CMB review, and that person must meet certain other requirements, which include being sued or charged with infringement. Is the USPS–an arm of the government–a person? Current patent law does not define the term. In a short opinion, the Federal Circuit held that the federal government is a “person” for the purposes of CMB review. There was a fiery dissent. The Supreme Court granted cert on this specific question.

And here is where the squirrelly thought arises. Just like CMB review, IPR review starts with a petition by a “person.” But unlike CMB review, an IPR petitioner need not have been sued or charged with infringement. Indeed, an IPR can be instituted by any person “who is not the owner of a patent.” 35 U.S.C. § 311. The USPTO must review all claims challenged in a petition if the USPTO accepts the petition. But the USPTO might not want to do that in every case–as in SAS. If the government is a person, can it escape SAS’s mandate by filing its own petition for IPR limited to the claims it actually thinks should be evaluated?

The process would go something like this: (1) the USPTO receives an IPR petition from a third party and reviews the petition, (2) the USPTO determines it would like to institute review on some of the claims of the patent challenged in the petition, but perhaps not the same claims as those listed in the petition, (3) the USPTO works in collaboration with another governmental agency (say, for example, the Attorney General or USPS), (4) the other governmental agency files a petition for IPR of the same patent, but on the claims and grounds desired by the USPTO, and (5) the USPTO accepts the governmental petition, achieving the goal of escaping SAS’s mandate that it decide the patentability of claims listed in the third party petition that the USPTO thinks need not be considered. And voila! Return the earlier petition for IPR as uninstituted to sender.

Thus, affirming the Federal Circuit could provide the government an escape from SAS, so to speak. While reversal could preclude agencies like the USPS from seeking cost-effective review of patents with the USPTO. What do you think?