October 26, 2018—Happy Halloween from DuetsBlog! I write today regarding a scary subject: unregistered intellectual property. The horror! Ask any IP professional about registration, and you’re likely to hear that registration is one of the most important steps in protecting IP. Whether it is a patent, trademark, or copyright, registering IP often provides the IP owner greater rights than if the IP was unregistered. There is sometimes an exception for trade secrets, but that’s for another time…

A scary place for some; credit: Gen. Progress

Registering IP, specifically copyrights, may become even more crucial in the future. One of the most important upcoming U.S. Supreme Court cases this term–which begins in October (coincidental?)–is Fourth Estate Public Benefit Corp. v. Wall-Street.com, LLC. The appeal addresses the question of whether the creator of an unregistered work may sue for copyright infringement so long as the creator has applied for a copyright on the work, rather than requiring the creator to wait for the Copyright Office to register the work. The dispute comes down to 17 U.S.C. § 411(a), which provides that:

no civil action for infringement of the copyright in any United States work shall be instituted until preregistration or registration of the copyright claim has been made in accordance with this title.

Currently, the Fifth and Ninth Circuit Courts of Appeal have held that creators may sue for infringement as soon as they file the appropriate paperwork and fees for registration. Importantly, the Ninth Circuit encompasses Hollywood, providing greater protection to many of the nation’s creators. I ran into this issue myself on a case in these venues, and thankfully the law in these jurisdictions supported bringing a claim for copyright infringement without awaiting registration.

The Tenth and Eleventh Circuits have held that filing for registration is insufficient; a creator must have obtained preregistration or actual registration to sue for infringement. It’s the stuff of nightmares for procrastinating creators in Wyoming, Utah, Colorado, Kansas, New Mexico, Oklahoma, Alabama, Georgia, and Florida!

But creators around the country, especially in Hollywood, let out a collective shriek when the federal Government filed a brief in support of the Tenth and Eleventh Circuits, arguing that “a copyright-infringement suit may not be filed until the Register of Copyrights has either approved or refused registration of the work.” Beyond the statutory arguments in support of this position, the Government argued that  “although…the registration requirement may temporarily prevent copyright owners from enforcing their rights, that is the intended result of a congressional design to encourage prompt registration for the public benefit.”

Maybe the Government is right; requiring registration will certainly encourage registration. But on the other hand, many small creators either do not have the time or resources to seek registration for every work. However, even in cases in which there is copying, a creator can file an expedited application for registration, which sometimes results in a decision in less than a week.  So perhaps the rule from the Tenth and Eleventh Circuits isn’t that scary after all. A non-expedited application can take months, though. Thus, the rule from the Fifth and Ninth Circuits provides greater protections to creators who may face copying immediately after creating a work and who do not have the ability to file an expedited application. We’ll see what’s in the Supreme Court’s candy bowl this term. To be continued…

October 11, 2018—Video games offer a melting pot of intellectual property: trademark law, copyright law, and even patent law all come together in a delicious mix of intangible property. However, not all video game franchises are equal. Few can claim the same level of longevity, success, and nostalgia as Nintendo’s Mario Brothers series.

Among the most popular titles of the franchise is Mario Kart, a game in which characters from the franchise race each other in go karts. The characters repeat catch phrases, seek out power ups (invincibility, speed, etc.) and cartoonish weapons (banana peels, turtle shells, etc.), all with the singular goal of being atop the podium at the end of race. Over its 25+ years of existence, the game has resulted in significant sales, widespread nostalgia, and, unsurprisingly, numerous attempts from others trying to make money off of the characters. But a recent lawsuit in Japan brought media exposure to what might have been the greatest attempt yet to profit off the franchise: real life go-karting in Mario Brothers costumes in the streets of Tokyo.

How fun is that? From what I can tell, riders aren’t allowed to throw things at each other (thanks a lot, safety laws), but this tour would still be great. The attraction even attracted professional race car drivers. You don’t even need to provide your own costume, they’ve got a ton for you to choose from.

Race car drivers weren’t the only people to discover the tour. Nintendo’s lawyers did, too. I’d like to imagine they participated at least once before suing them, if only under the pretense of “fact development.” Nintendo sued and ultimately prevailed on claims of copyright infringement. The company has to pay Nintendo 10 million yen (about US$89,000) and can no longer hand out Mario Brothers character costumes.

It’s hard to quibble with Nintendo’s actions here. The MariCar company intentionally distributed character costumes in order to attract customers.

But what are Mario Kart fans supposed to do now? Well, there will be an official Super Nintendo World opening at Universal Studios Japan ahead of the 2020 Tokyo Olympics. The theme park will include a Super Mario World featuring Bowser’s castle, Peach’s Castle, and, yes, a “Mario Kart attraction.”

But if you prefer the thrill of participating in likely infringing activities, you can check out the Australia-based MUSHROOM RALLY race event purportedly coming to Denver, soon. Participants will have a chance to battle it out in Las Vegas for the championship race. Ticket prices are yet to be determined and are limited to just 600 participants. I suggest you read the fine print on the refund policy though – just a hunch…

October 5, 2018—It’s fall, and you know what that means: football season! For many, this means a return to the couch each weekend to spectate America’s most-watched sport. But the popularity of doing so appears to be in decline. This shift isn’t only affecting the NFL, but also college football as well, as ticket sales continue to plummet. Increasingly among my own family and friends, it seems as if everyone is more interested in playing their fantasy leagues than watching reality unfold before them. Which is why, one would think, that leagues and other football organizations would want to promote discussion about football, rather than hinder it.

Credit: Geek.com

But football organizations are cracking down on, rather than encouraging, use of familiar football names and phrases. Some have questioned, for example, the NFL’s bully-like tactics in aggressively protecting the “Superbowl” name. The annual “big game” is so well-known and such a major event that it’s almost impossible not to use its actual name. Yet, the NFL persists, enforcing more than just its famous name, drawing the ire of commentators each year.

Such tactics appear to have inspired a recent filing by the Heisman Trophy Trust against “HeismanWatch.com,” for trademark and copyright infringement. The Heisman Trophy Trust, the complaint says, is the owner of a slew of federal trademark and service mark registrations related to the Heisman Trophy, “one of the most distinguished, prestigious, and recognized awards in all of sports, and perhaps the most famous of all individual awards in football.” The award is given to the most outstanding collegiate football player, usually a quarterback or running back, each year. You might recognize the trophy by its distinctive “stiff-arm” maneuver captured in bronze:

Credit: The Ringer

Defendant HeismanWatch.com is a website that offers information, analysis, and podcasts about the Heisman trophy award. It is known for its “one-of-a-kind regression model that processes simulated Heisman votes,” to predict in advance who will win the Heisman each year. It reportedly correctly predicted the most recent winner, Baker Mayfield.

The Heisman Trophy Trust, apparently, does not appreciate HeismanWatch.com’s analysis and attention. It alleges that the website is deliberately attempting to free ride on the fame and notoriety of the Heisman Trophy marks, and it says that consumers are likely to believe there is a connection between the website and the actual trophy organization. Of course, the fact that HeismanWatch.com exists at all belies any such connection; the Trophy selection is secretive, but the website helps fans read the field and guess who will win next.

Time will tell whether the Heisman Trophy Trust can prevail against a news reporting and commentary organization like HeismanWatch.com, but it’s not unprecedented. The Academy Awards sued “OscarWatch.com” over a decade ago, prompting the website to change its name to “Awards Daily.” One cannot help but think that HeismanWatch.com has an incredibly strong nominative use defense, though. Under nominative use doctrine, another person can use the trademark of another if:

1. the thing identified by the trademark (here, a trophy) cannot be readily identified any other way;
2. the mark is used only as much as is necessary for that identification; and
3. the use does not suggest sponsorship or endorsement.

The nominative use defense protects free speech and against the need to use “absurd turns of phrase” to avoid liability.

Credit: Wikipedia

It’s difficult to imagine a viable substitute to the name “Heisman,” given the trophy’s actual name–and namesake. What alternatives are there to HeismanWatch.com that do not include the surname? One commentator  offered an idea:

BestOffensivePlayerWithAGreatPRCampaignOnAVerySuccessfulTeamWatch.com.

Of course, this is absurd. And generic alternatives would fail to adequately describe what the website does (e.g., OutstandingCollegiateFootballPlayerWatch.com). One also doesn’t have to look much farther than a simple Google search to find that the media regularly uses “Heisman Watch” as a phrase to discuss anticipation about the next awardee. Even ESPN has a section called “Heisman Watch.” This kind of ubiquity shows the obvious necessity of using the surname. The common use of the phrase also suggests there is a very low likelihood that collegiate football fans are confusing the website–or any other reporting source–with the actual trophy organization. These are hallmarks of fair use.

But setting aside the legal defenses, one has to wonder if organizations such as the Heisman Trophy Trust, NCAA, and NFL ought to relax a little, and encourage the kind of use presented by sites like HeismanWatch.com. These fan centers generate excitement about, and interest in, football. That’s something football desperately needs more of lately.

Credit: Local Solutions

September 21, 2018—I write today regarding a squirrelly thought: are the benefits of registering a hashtag trademark almost always outweighed by the consequences? In light of a recent Trademark Trial and Appeal Board (“TTAB”) ruling and the Trademark Manual of Examining Procedure’s (“TMEP”) provisions, hashtag marks offer much less protection than traditional character-based marks, such that the latter are preferable in most situations.

We’ve all seen hashtag words and phrases (without spaces between the words) in social media, most commonly on Twitter–but also now on other sites, such as Facebook and Instagram. By affixing a hash symbol (#) to a word or phrase in a post, users can garner attention, join in a movement, and possibly “go viral.” Popular recent trending examples are #MeToo and #TakeAKnee. And of course, who could forget:

#selfie

Hashtags serve filtering, identifying, and promoting functions that have commercial advertising value. Thus, it is no surprise that hundreds of individuals and companies have applied for trademarks on “hashtag marks,” seeking to control the use of certain hash-preceded words and phrases. In fact, at the time of writing, there are over 1,900 such registrations. Hashtags are hip, and everyone wants one–or so they think.

In 2016, the USPTO added TMEP § 1202.18, which explains when “hashtag marks” may be registered:

A mark consisting of or containing the hash symbol (#) or the term HASHTAG is registrable as a trademark or service mark only if it functions as an identifier of the source of the applicant’s goods or services. . . . Generally, the hash symbol and the wording HASHTAG do not provide any source-indicating function because they merely facilitate categorization and searching within online social media . . . .Therefore, the addition of the term HASHTAG or the hash symbol (#) to an otherwise unregistrable mark typically will not render it registrable.

Recently, the TTAB applied this rule and other doctrines, holding that the addition of hashtags usually do nothing to make a mark distinctive. In the case, the TTAB rejected singer Will.I.Am’s application for a hashtag mark for #WILLPOWER because it was too similar to other registered marks containing”willpower,” and the hash symbol had no source-indicating distinctiveness, merely operating as a metadata tag for social media platforms.

The TTAB decision and TMEP provisions greatly narrow the registrability of hashtag marks, as well as their enforcement scope, such that it seems as if there is very little upside to applying for such a mark in most circumstances. An applicant does not need to register an otherwise-registrable mark as a hashtag mark in order to protect the mark if hashed. In such cases, a hashtag registration provides no more protection than a traditional character registration; the hash adds no additional layer of distinctiveness, just as it would not lend distinctiveness to an unregistrable word or phrase. Thus, an applicant should only apply for a hashtag mark in instances in which the non-hashed word or phrase lacks distinctiveness without the hash. If there is a case to be made for a traditional mark, the applicant should pursue that mark instead because traditional marks can be enforced more broadly.

If an applicant applies, however, only for a hashtag mark, then non-distinctiveness absent the hashtag will work to preclude the registrant from enforcing the mark in non-hashed situations. Even if the hashtag mark could be a mark on its own without the hash, the fact that the hashtag mark is either the first or only mark could result in a presumption against non-hashed distinctiveness–after all, why apply for a hashtag mark at all in such circumstances? It may also be more difficult to prove that non-hashed phrases, which in their non-hashed form are separated by spaces, infringe the hashtag mark. Imagine, for example, two competing phrases (the first example of which is a registered hashtag mark):

#lifeofabusyexecutive

Life of a Busy Executive

If the hash provides the distinctiveness for the first example (and perhaps in tandem with the lowercase and squished text), then presumably the second phrase without the hash (and with spaces) would not tread on that distinctiveness, working against a showing of consumer confusion and infringement. Of course, the holder of the hashtag mark could prevent identical use by competitors in commerce, but not similar non-hashed uses.

Emerging trademark law teaches that hashtag marks are extremely narrow–intentionally so–and as we’ve discussed before, hashtag marks are also greatly susceptible to fair use defenses. There appear to be few upsides to seeking such marks, at least without first trying for a traditional mark. So although trademark commentary as of late has focused on the trendiness of obtaining a hashtag mark, the more important question is whether it is worth doing so. In most cases, the answer will probably be “no.”

September 13, 2018—As we move into Week 2 of the NFL, the big clash in North Country is Sunday’s Green Bay Packers – Minnesota Vikings game. All the buzz is whether the second-coming-of-Favre Aaron Rodgers will prevail over the vaunted Vikings defense. But here in my trademark bubble, I’m more interested in the Jacksonville Jaguars versus former Jaguar player Dan Skuta. This isn’t a contract negotiation battle, but instead a dispute over who owns the claimed trademark rights in the word SACKSONVILLE. The dispute is now the subject of a pending opposition at the Trademark Trial and Appeal Board.

In the Notice of Opposition to the team’s application, Skuta claims to have been the first to coin the term “Sacksonville,” back in July of 2015, but his pending application was refused based on a possible likelihood of confusion with the team’s already filed application. He created a Twitter account and hired a graphic designer to create the logo below, which appears on Skuta’s website.

In the team’s application to register the claimed #SACKSONVILLE mark, the Jaguars claim a first use date of September 1, 2017.  However, the team has the ability to present evidence of use earlier than the date of first use listed in the application. One article notes that the team has used the phrase as a social media hash tag at least as early as 2013. But in most circumstances, merely using a word as a social media hashtag does not constitute use in commerce.

Unsurprisingly, one local Jacksonville news outlet is skeptical, siding with the team over a “forgettable linebacker . . . who may have been better at anticipating trademark uses than he was at reading offenses.”

It is possible that Skuta may have used the mark in commerce before the team. Skuta hasn’t made his case any easier by including in the logo what appears to be a jaguar skull and the same Jacksonville Jaguar teal color. On top of this, the play on words with “Jacksonville” potentially creates association with the team, too.

It’s a bit of a mess: are there even any trademark rights and, if so, who owns them? It seems the team likely should be the owner, but perhaps they fumbled the rights along the way. We may have to wait for the Trademark Trial and Appeal Board to weight in to see who emerges from the scrum with the ball.

September 7, 2018—As Steve blogged earlier this week, we’ve had a lot of “zero” on the mind lately—marks related to the word and numeral. It got me thinking about the letter ‘O,’ especially since it has been in recent trademark news.

If you missed it, The Ohio State University and Oklahoma State University are now dueling it out at the USPTO over Oklahoma’s trademark application related to the block ‘O.’ Specifically, Oklahoma is attempting to register a mark of “a drum major marching while leaning back with head tilted back”:

According to Oklahoma, it has been using the singular block ‘O’ since 2001, most notably on the jersey of its band’s drum major (but also on sports memorabilia):

But in an opposition to the mark, Ohio says it has been using the same letter since as early as 1898, and it’s current main athletics logo includes the block ‘O’ in the background:

According to Ohio, Oklahoma’s use of the leaning and tilted ‘O’ is likely to cause confusion. I wonder if any other O-state institutions will weigh in—looking at you, Oregon.

On the one hand, the block styling of the Oklahoma ‘O’ could cause consumers to accidentally purchase sports gear from the wrong institution. On the other hand, the letter ‘O’ is such a fundamental unit of the English language that it’s hard to argue just one institution should be entitled to its exclusive use—even if it’s only in the college sports context. And Oklahoma is only seeking registration of a mark which uses ‘O’ in a minor fashion. However, Oklahoma’s marching ‘O’ mark could run into issues related to the requirement that the mark be used in commerce. After all, it’s a mark representing the band major, who wears an ‘O.’ How does Oklahoma otherwise use the mark or plan to use it commerce?

It turns out that the letter ‘O’ is not widely used as a mark on its own. There are some recognizable uses, though. Perhaps the most distinctive use of the letter ‘O’ is the Oprah Magazine:

In 2001, a German magazine also named ‘O’ sued Oprah’s ‘O’ magazine, but the suit appears to have gone nowhere, and Oprah’s ‘O’ lives on.

The only other major ‘O’ competitor appears to be Cirque du Soleil:

Maybe there’s some potential for confusion between the Oklahoma drum major and the high-flying circus performers. Though, I’m guessing the audiences for both don’t substantially overlap.

I think the few recognizable instances of ‘O’ marks can be explained by the overall minor distinctiveness a single letter can generate when used in connection with a brand. This is the up-hill battle both Ohio and Oklahoma will face in arguing their sides of the trademark dispute. Stronger letter marks are paired with other words, such as O Magazine and O Cirque du Soleil. Another example comes to mind: Toys ‘R Us (also in the news lately).

August 27, 2018—The battle for attorneys’ fees after an intense trademark dispute often leaves many prevailing parties empty handed. This is because the Lanham Act only provides for attorneys’ fees in “exceptional cases.” Congress’s (and courts’) reluctance to award attorneys’ fees stems from the “American Rule,” which provides that each party to a lawsuit is responsible for paying its own fees–unless a statute provides otherwise. But the Lanham Act erects a high bar to obtaining fees by requiring that the case be “exceptional.”

On the one hand, trademark owners should not have to fully shoulder the burden of what often turns into expensive litigation just to enforce their rights. Indeed, the estimated cost of protecting one’s rights can dramatically affect the calculus of whether to sue for infringement in the first place. But on the other hand, trademark violations are sometimes debatable and unclear. In such circumstances, the American Rule provides some protection to litigants who would otherwise be discouraged from seeking redress due to the risk that they might have to pay the defendant’s fees in the end if they lose. Thus, the Lanham Act strikes a balance, providing for reimbursement in cases of brazen and clear infringement–or brazen and clear abuse of the litigation process–while retaining the benefits the American Rule otherwise provides.

The Lanham Act’s fee provision has come up recently in two high-profile trademark cases: one involving Comic Con (reported on previously here and here), the other meme-famous Grumpy Cat (also reported on previously here). But the result was legally different in both cases, with Comic-con obtaining millions in fees under the Lanham Act, while Grumpy Cat obtained nothing under the Act, but recovered nevertheless pursuant to a contract between her and the infringer. What explains the different results?

Comic-con: The Comic Con (short for “comic book convention”) dispute began when the San Diego Comic Con sued the Salt Lake Comic Con for infringing on San Diego’s “Comic-Con” trademarks. The San Diego convention was one of the first comics-fan conventions.  And it is the largest convention of its kind, drawing more than 130,000 attendees each year. Salt Lake’s convention began in 2013, but it has quickly grown to over 120,000 attendees. Thus, it is probably no surprise that San Diego took exception to Salt Lake’s competing event and use of the same “Comic Con” name–though, as my colleague Jessica Alm pointed out, there are many other conventions across the United States using the same name.

San Diego Comic Con sued Salt Lake Comic Con for infringement. But despite the seemingly-debatable nature of the dispute (because the name could be generic, and it would be difficult to prove consumer confusion), less than a year ago a jury determined that Salt Lake was liable for infringement in the amount of $20,000. Thereafter, San Diego moved for fees in the amount of $5 million–a little disproportionate, one would think (but perhaps not in view of San Diego’s requested $12 million in damages).

The district court judge granted $3.9 million. The reasons? Salt Lake repeatedly disregarded court rules, violated confidentiality rules, squandered judicial resources by relitigating issues, based arguments on irrelevant law, and attempted to bias the jury during the trial. The judge felt that the case stood out from others due to the “unreasonable manner it was litigated.” Expect an appeal on the $20,000:$3.9 million ratio.

Grumpy Cat: The Grumpy Cat dispute began when Grenade Beverage LLC, which had licensed Grumpy Cat’s trademarks (names and likenesses) to be used in trade dress and advertising for a new line of iced coffee products called “Grumppuccinos,” also used the marks in connection with a new coffee bean product without Grumpy Cat’s permission. Like the Comic Con litigation, the parties also litigated this case for three years. In addition, a jury awarded Grumpy Cat over $700,000–much more than San Diego Comic Con. But only $1 of that was for breach of the licensing agreement.

But unlike the Comic Con litigation, a federal judge recently denied Grumpy Cat’s request for approximately $320,000 in fees under the Lanham and Copyright Acts. The judge did, however, granted Grumpy Cat fees under the licensing agreement with Grenade Beverage–though, the judge said that there needs to be additional briefing on how much in fees can be awarded under the contract. Central to the judge’s decision on the Lanham Act fees issue was the fact that Grenade Beverage had not acted frivolously or in bad faith when they adopted an interpretation of the licensing agreement that entitled them to use Grumpy Cat’s marks in a line of Grumpy-Cat- branded “coffee products,” rather than just iced coffee. This reasonable difference of opinion–and, presumably, reasonable litigation behavior throughout the case–did not make out “exceptional” circumstances justifying fees under the Lanham Act.

In general, the Comic Con and Grumpy Cat cases provide two high-level teachings when it comes to fees. First, it is important to choose professional counsel, make reasonable litigation decisions, and take good faith positions throughout the course of a case. Otherwise, that conduct in and of itself may make the case “exceptional,” putting you on the hook. Second, attorneys’ fees provisions in a licensing agreement can serve as a helpful back-up if the Lanham Act fees request fails. But in providing for such fees, one should consider whether it is truly advantageous in the circumstances to remove the American Rule’s protections. That requires some thought…I need a Grumppuccino.

P.S. In April, I wrote about the USPTO’s attempt to obtain attorneys’ fees when it prevails in district court patent litigation. The Federal Circuit rejected this attempt, stating “the American Rule prohibits courts from shifting attorneys’ fees from one party to another absent a ‘specific and explicit’ directive from Congress. The phrase ‘[a]ll the expenses of the proceedings’ [in 35 U.S.C. § 145] falls short of this stringent standard.”

August 22, 2018—PepsiCo recently made waves with its purchase of SodaStream, but the company is now making news in the food business. This time the news is all about Pepsi’s Frito-Lay division, and its mischief making Chester Cheetah and his crunchy, cheesy, Cheetos brand. Pepsi recently sent a cease and desist letter to World Peas, a manufacturer of healthy-ish snack foods and its recent marketing of Peatos brand snacks.

What are Peatos exactly? They’re a crunchy snack food made primarily from peas and lentils, but, Peatos are not intended to be a “health food.” The company describes its mission as making “90% of people eat 10% better, not 10% of people eat 90% better.” The goal appears to be: make a snack that is a little bit better for you without sacrificing flavor. Product quality aside though, is Pepsi correct that the PEATOS mark is confusingly similar to the CHEETOS mark?

Courts consider a variety of factors in evaluating whether someone is infringing another’s trademark: do the marks create similar commercial impressions; are the products at issue competitive, similar, or related; how strong are the marks in terms of meaning and commercial strength; are the goods sold through similar channels of trade (i.e., through the same types of stores); and others. The two factors that tend to play the most prominent role are the similarity of the commercial impressions of the marks and the similarity of the goods.

In the Peatos versus Cheetos dispute, many of the factors would favor Pepsi. The goods are competitive (even if one is a bit healthier), both are sold in the grocery stores, and the CHEETOS mark is an arguably famous and strong mark. But even if every single factor but one were to favor Pepsi’s claim of infringement, it would not be enough if the marks are so dissimilar that no confusion is likely. So what do you think, how similar to Cheetos is Peatos?

The only difference in sound is the initial letter P versus the CH sound. Visually, the marks have a few more differences in letters. As far as I’m aware, neither mark has a defined meaning. The PEATO mark has additional meaning of one its ingredients (Pea).

But what about the overall commercial impression of the marks? What is the impression that Peatos will make in the mind of a consumer? For me, the immediate impression is that the product is a Cheeto made from peas. In fact, I can’t imagine that World Peas came up with the name in any other way other than “What should we call a Cheeto made from peas? Oh! Peatos would be a good pun!”

A likelihood of consumer confusion does not require actual consumer confusion. It also does not require that consumers confuse the products themselves, or that a consumer incorrectly think that Pepsi makes Peatos. A likelihood of confusion exists whenever a consumer might mistakenly believe that there is some type of endorsement, connection, or affiliation between the two parties. Given Pepsi’s recent purchase of SodaStream and the general trend toward healthier consumer choices, is it really that much of a leap to imagine a famous brand of snacks extending into a pea-based version of itself?

Setting aside the similarity in the marks, World Peas is actively drawing a connection between Cheetos and Peatos through use of a tiger and a similar color scheme for its bag and logo. The fact that the actual Peatos products look like Cheetos isn’t likely an issue, but it doesn’t help, especially if Pepsi argues a claim of post-sale confusion.

In addition to all this, World Peas makes explicit Cheetos comparisons on its website. Granted, these comparisons likely qualify for a fair use (although the use of the Cheetos logo may be more than necessary). However, when you know you’ll be poking the tiger, do you really need to pull its tail and poke it in the eye too? If the company truly plans on sticking with the Peatos name, it may have been best to not exacerbate Pepsi’s concerns and use a different colored logo, avoid the tiger on the packaging, and maybe not so aggressively market yourself as a healthier version of Cheetos. While Pepsi may have still come knocking, Pepsi would at least have less ammunition for its claims.

I wouldn’t say this a clear cut case of infringement, but given all these facts, there is at least a colorable claim of infringement . The company must have known it would receive a demand letter regarding the name. Perhaps the plan was to enjoy the free press for its new product and then switch the name, knowing the name change would also be heavily publicized?

Apart of from the potential legal liability, it isn’t a terrible plan, and I’m certainly interested in trying a bag of Peatos. Once I find a bag, I’ll be sure to let you know whether they’re g-r-r-r-r-r-r-r-eat!

August 10, 2018—I’ve been thinking about the nature of language lately, ever since I listened to a podcast about various philosophers who devoted their study to language. For example, Ludwig Wittgenstein, one of the most influential philosophers of the twentieth century, is famous for his work on the logic of language. A fundamental premise to his philosophy is that “the limits of my language mean the limits of my world.” In other words, language, although purposed on painting a picture of reality, is fundamentally limited in its ability to describe and do so fully and accurately. For Wittgenstein, this primarily meant that language cannot help us answer pressing metaphysical questions, but the realization has practical importance in branding.

Consider Wittgenstein’s insight in tandem with the desire to promote recall and recognition in a name without causing customers to confuse the name with another source, and you are presented with the challenge underlying all word-based marks: to turn a generally-known and familiar word (or prefix or suffix or otherwise) into a distinctive identifier so that it means something different or more than its generic definition. No small task, especially given language’s inherent descriptive limitations, and this is evidenced by the finite universe of words and combinations to choose from. There is bound to be some overlap in naming. Hence, we regularly witness “trademark twins”–the same or similar words used as marks for different sources of goods and services.

One example of trademark twinning has garnered attention in the press recently, arising from a trademark infringement suit between the Billy Goat Tavern and the Billy Goat Chip Company. The Billy Goat Tavern is a fast-food restaurant in Chicago which gained notoriety when its founder brought his goat to a Cubs game, but was asked to leave (with his goat), casting the “Billy Goat’s Gruff” curse on the Chicago Cubs. Saturday Night Live also parodied the experience of eating there–accurately, I can attest.

Credit: Fox 32

The Billy Goat Chip Company, out of St. Louis, has no affiliation with the Tavern, but the Tavern took issue with the Chip Company’s similar name after the Chip Company’s crisps started showing up in Chicago. Recently, a federal judge rejected the Chip Company’s defense that the Tavern delayed too long in suing the Chip Company, after having notice of the similar name for several years. It is worth noting that although the companies’ names begin with the same two words, their logos set them apart:

But the similarity of the names in the context of food may be more likely to cause confusion than if the names were used in completely different industries. On a continuum of “identical” to “fraternal” (non-identical) twins, it’s hard to pinpoint where the marks fall–and, thus, whether trademark law would require a bit more distinguishing. There is a possibility that consumers would think of the chips, for example, as having some affiliation with the Billy Goat Tavern as a source. This is even more likely when one realizes that the Billy Goat Tavern has never sold fries, only chips with its signature “cheezborger.” Coincidence? I’ve written about stranger coincidences before. Even then, though, how many consumers are that knowledgeable about the Billy Goat Tavern to make the connection? I’m thinking these twins are fraternal.

Numerous other examples of trademark twins abound: Domino’s Pizza and Domino Sugar, Dove Soap and Dove Chocolate, Pom Wonderful and Wonderful Pistachios–just to name a few! Speaking of three, how about some trademark triplets: Apple (iPhone), Apple Records, and Apple Paints. Or quadruplets: Delta Airlines, Delta Dental, Delta Faucet, and Delta Power. These twins, triplets, and quadruplets all borrow similar common words as names, but use them in different industries–making it unlikely that consumers will confuse the companies as one source. Their use in dissimilar markets and in connection with unique logos mitigates the legal danger presented by the intersection of the limits of language, fleetingness of human memory, and protections afforded by trademark law. But industry and logo are just two ways in which their genes differ.

Can you think of additional trademark twins or otherwise? How are they fraternal or identical? What do you think is most important when balancing simplicity, familiarity, notoriety, and legality?

July 27, 2018—One week ago, the Federal Circuit Court of Appeals issued its decision in Saint Regis Mohawk Tribe v. Mylan Pharmaceuticals, Inc., 18-1638 (Fed. Cir. July 20, 2018)–by all accounts, one of this decade’s most important decisions concerning the America Invents Act and the patent system. The primary issue in the case was whether the Saint Regis Mohawk Tribe (or any tribe, for that matter) is immune from the USPTO’s inter partes review (“IPR”) proceeding, which can result in cancellation of a patent. Allergan, a pharmaceutical company, had transferred title to certain patents to the Tribe after its competitor, Mylan, had instituted an IPR of the patents. The Tribe claimed that the USPTO could not review the patents due to sovereign immunity.

The Federal Circuit held that tribal sovereign immunity does not apply to IPR proceedings. It cited the Supreme Court’s recent Oil States decision (I wrote about the case earlier this year), which explained that IPRs arise “between the Government and persons subject to its authority in connection with the performance of the constitutional functions of the executive or legislative departments.” Thus, IPR is “simply a reconsideration of” the original patent grant by the federal Government. Although initiated by a private party, the Director of the USPTO must decide to institute the proceedings, and the USPTO acts “as the United States in its role as a superior sovereign to reconsider a prior administrative grant and protect the public interest in keeping patent monopolies ‘within their legitimate scope.’” The federal Government being supreme, tribes cannot invoke sovereign immunity.

The Federal Circuit’s final reference to protecting the public interest resonated with me, as well as Judge Dyk’s concurring opinion, which provided insightful context about the importance of reviewing patents post-grant. Certainly no one expects that the USPTO will perfectly examine every patent application and grant patents without error, but striving to achieve perfection is vital–even if impossible under current circumstances. As Judge Dyk illuminated:

[T]he USPTO–then and now–is an agency with finite resources that sometimes issues patents in error. Currently, for instance, the USPTO receives over 600,000 applications a year. Patent examiners receive roughly 22 hours to review each application, an amount of time that 70% of examiners report as insufficient.  And the USPTO struggles to attract and retain examiners with the technical competence required to understand the inventions being reviewed and to perform sufficiently thorough prior art searches.

The USPTO “is under pressure to make speedy determinations on whether or not to grant patents.” As such, “pre-grant patent examination was–and still is–an imperfect way to separate the good patents from the bad. Resource constraints in the initial examination period inevitably result in erroneously granted patents.” A glut of bad patents–or the perception thereof–negatively affects the public’s view of the patent system’s fairness and credibility. Thus, Congress created IPRs to combat pre-grant examination constraints, creating a streamlined procedure to challenge patents, in the hopes of restoring trust in the patent system. As an initial matter, I’m not sure attempting to solve the effect of the USPTO’s constraints was better than solving its cause.

In a recent article, I wrote about similar concerns as those expressed by Judge Dyk:

The USPTO, as the agency tasked with examining patent applications, is the first line of defense against patent fraud. But some point to the USPTO’s examination policies as potentially inviting fraud. By way of background, the USPTO’s patent examiners (those who review applications) are evaluated on a quota system, which encourages them to examine as many applications as possible. Some commentators have questioned whether this policy has turned the USPTO into a rubber-stamp institution. In the meantime, the number of patent applications and grants since 2000 has almost tripled. This has led to an even greater need for the USPTO to quickly accept or reject patents so as not to fall behind. The cycle is further incentivized by the increasing economic and financial value of patents. And it is also enabled by the difficulty, high cost, and/or impossibility of investigating every representation made by patent applicants. The USPTO simply does not have the wherewithal to investigate every claim of inventorship, utility, novelty, and other issues related to patentability. Thus, along with the important interests at stake, the complexities of patent law and the USPTO’s current weaknesses combine to create a situation in which fraud is less likely to be identified and thwarted.

In the context of the Mohawk Tribe appeal, the overwhelming public interests in reviewing potentially-invalid patents were brought to bear against the amorphous concept of sovereign immunity. It was absolutely necessary that tribes be subject to IPRs, lest private parties be enabled to take advantage of the USPTO’s constraints and “rent” the protection of sovereign immunity. Indeed, in a recent article, another commentator argued that the Federal Circuit’s decision had an “inescapable wisdom” because, had the result been any different, “every holder of questionable U.S. patents would have been rushing to one Native American tribe or another seeking deals to shelter possibly bogus rights.”

Going further, though, one can imagine more than just deals between tribes and private parties, but also the emergence of an entirely new form of patent assertion entity, patent troll (which some, but not all, criticize), and perhaps even a hybrid form of “patent privateer.” A tribe could, itself, become a mass aggegator of patents with a huge advantage: that the avenues for challenging its patents are more limited than a traditional patent holder. And one can imagine patent alliances renting tribal sovereign immunity for large market players. Any of these could exacerbate the David-and-Goliath scenario some defendants find themselves in after being sued for infringement. But, if the Federal Circuit’s decision holds–and I predict it will, especially in view of Oil States–such possible negative effects will not come to pass. However, as Judge Dyk implied (and it bears repeating), the patent system is imperfect and still has a way to go.