Supreme Court Agrees to Review Bar on Registration of Disparaging Marks, Denies Washington Redskins' Petition to Join Proceedings
Supreme Court Agrees to Review Bar on Registration of
Disparaging Marks, Denies Washington Redskins' Petition to Join
Proceedings Lee v. Tam, No. 15-1293 (Sept. 29, 2016);
Pro-Football, Inc. v. Blackhorse, No. 15-1311 (Oct. 3,
2016)
The Supreme Court granted the USPTO's petition for certiorari
on appeal from the Federal Circuit's en banc decision holding
that Section 2(a) of the Lanham Act—which bars registration
of marks "which may disparage . . . persons, living or dead,
institutions, beliefs, or national symbols, or bring them into
contempt, or disrepute"—is facially unconstitutional
under the First Amendment. In re Tam, No. 2014-1203 (Fed.
Cir. Dec. 22, 2015). In a divided opinion, the Federal Circuit had
vacated a TTAB ruling that upheld the PTO's refusal to register
the rock band name THE SLANTS as a trademark on the ground that the
mark is disparaging to persons of Asian descent in violation of
Section 2(a). After granting certiorari in Lee v. Tam, the
Supreme Court denied without comment an extraordinary petition for
certiorari before judgment from the Washington Redskins, whose case
challenging Section 2(a) is currently pending before the Fourth
Circuit as Pro-Football, Inc. v. Blackhorse, No.
1:14-cv-01043, and who sought to join the proceedings before the
Court. The question presented for review in Lee v. Tam is
"whether the disparagement provision in 15 U.S.C. 1052(a) is
facially invalid under the Free Speech Clause of the First
Amendment."
Copyright Opinions
Ninth Circuit Affirms Summary Judgment for Defendant
Based on Access Prong: Loomis v. Cornish, No. 13-57093 (9th Cir.
Sept. 2, 2016)
Clifton, J. In a copyright dispute alleging that the
defendants' song "Domino" infringed the
plaintiff's song "Bright Red Chords," the Ninth
Circuit affirmed the district court's grant of summary judgment
for the defendants, holding that the plaintiff had not raised a
triable issue of the defendants' access to "Bright Red
Chords" so as to support a finding of copying. With respect to
the plaintiff's access-through-intermediaries theory, the court
held there was no admissible evidence of a nexus between the
specific "work unit" that created "Domino" and
any of the plaintiff's proposed intermediaries, including an
Artists & Repertoire representative at defendant Universal
Music Group who had requested a copy of "Bright Red
Chords." The Ninth Circuit further rejected the
plaintiff's widespread-dissemination arguments; the fact that
the "Domino" songwriters spent 10 days in a town whose
local market was "saturated" with "Bright Red
Chords" did not raise a triable issue of access, as there was
no evidence that the songwriters participated in the local music
scene. The court acknowledged that the plaintiff's case told a
story that, if substantiated with admissible evidence, might have
survived summary judgment.
3-D USB Drive Based on 2-D Computer Game Icon Not
Unoriginal as a Matter of Law: Direct Technologies, LLC v.
Electronic Arts, Inc., Nos. 14-56266, 14-56745 (9th Cir. Sept.
6, 2016)
Gould, J. In a case involving alleged copyright
infringement of a 3-D USB drive prototype modeled after the
"PlumbBob" icon from the computer game The Sims,
the Ninth Circuit reversed the district court's holding on
summary judgment that the USB drive was not copyrightable as a
derivative work because it was insufficiently original when
compared to the 2-D icon. Where the plaintiff asserted that it
designed the USB drive to have a "futuristic cut away look . .
. at a unique angle" for aesthetic reasons, the Ninth Circuit
held there were genuine issues of material fact regarding both (a)
whether that design feature was "truly
'artistic'" rather than functional and (b) whether
that feature rendered the drive sufficiently original to merit
copyright protection. The Ninth Circuit further reversed the
district court's alternative holding that the plaintiff was not
a joint author of the claimed derivative work, holding there was a
triable issue as to whether the plaintiff "was sufficiently in
control of its artistic contribution to qualify as a joint author
in the . . . prototype" and whether the plaintiff's
contributions to the drive design contributed to the "audience
appeal" of the drive. However, the Ninth Circuit affirmed the
district court's grant of summary judgment on the
plaintiff's California state law claim of trade secret
misappropriation, holding that the plaintiff had failed to present
evidence that there was any economic value in the secrecy of its
design.
Common Law Trade Secret Misappropriation Claim Not
Preempted by Copyright Act: GlobeRanger Corp. v. Software AG
United States of America, Inc., No. 15-10121 (5th Cir. Sept.
7, 2016)
Costa, J. The Fifth Circuit upheld a $15 million jury
verdict finding that the defendant had misappropriated the
plaintiff's trade secrets. The defendant had appealed the
judgment on several grounds, including that federal copyright law
preempted the plaintiff's common law trade secret
misappropriation claim or, if preemption did not apply, the
district court lacked subject matter jurisdiction because there was
no federal cause of action. In a case of first impression, the
Fifth Circuit held that because Texas trade secret law requires
establishing an element additional to what is required to make a
copyright violation—namely, that the defendant obtained the
protected information "through a breach of a confidential
relationship or . . . improper means"—the
plaintiff's common law trade secret misappropriation claim was
not preempted by the Copyright Act under the extra-element test.
The Fifth Circuit rejected the defendant's alternative
contention that the district court lacked subject matter
jurisdiction, holding that the Copyright Act did preempt the
plaintiff's additional claim for conversion of intangible
property and thus federal question jurisdiction existed at the time
of removal, even though the plaintiff later voluntarily dismissed
the conversion claim.
Trademark Opinions
Injunction Provisions Vacated as Overbroad Based on
Concession at Trial: Diageo North America, Inc. v. Mexcor,
Inc., No. 15-20630 (5th Cir. Sept. 2, 2016)
(non-precedential)
Per curiam. After a jury verdict finding infringement of
Diageo's "purple bag" trade dress used in connection
with its Crown Royal whisky, the district court entered a permanent
injunction that, among other things, prohibited the defendant from
using the word "crown" in combination with cloth bags for
whisky. THe defendant argued that the injunction was overbroad
because Diageo effectively had conceded earlier in the litigation
that the defendant's use of an unlabeled cloth bag as packaging
was not infringing. The Fifth Circuit agreed, and directed the
district court to revise its order so as not to "bar[]
admittedly lawful activities." The Fifth Circuit declined to
vacate the portion of the order that prohibited the defendant from
"[u]sing any name or trade dress that is confusingly similar
to or dilutes the Crown Royal trade dress," but
"suggest[ed] the district court reconsider whether the
provision is insufficiently specific." The Fifth Circuit
otherwise affirmed the district court's denial of motions to
amend the judgment and for judgment as a matter of law.
Second Circuit Questions Its Deferential Review of
District Court's Likelihood of Confusion Analysis on Summary
Judgment: Kelly-Brown v. Winfrey, No. 15-697-cv (2d Cir.
Sept. 16, 2016) (non-precedential)
Summary order. In an unpublished opinion, the Second
Circuit affirmed the district court's summary judgment for
defendants in a dispute over Oprah Winfrey's use of the phrase
"own your power"—a particular stylized form of
which the plaintiffs had registered as a trademark. The Second
Circuit declined to decide whether registration of the composite
mark entitled the plaintiffs to a rebuttable presumption of
inherent distinctiveness for the literal phrase alone. Assuming
arguendo that the plaintiffs were entitled to a rebuttable
presumption, the court held that the defendants had successfully
rebutted the presumption with evidence demonstrating, as a matter
of law, that the phrase is merely descriptive as applied to the
plaintiffs' business of life coaching and motivational events,
and that no reasonable jury could find the phrase had acquired
secondary meaning. Having thus held that the literal element of the
plaintiffs' mark was not entitled to protection, the Second
Circuit held that the plaintiffs failed to present sufficient
evidence to raise a triable issue of likelihood of confusion.
Although the opinion contains no detailed analysis of the
Polaroid likelihood-of-confusion factors, in a footnote
the Second Circuit noted that its own precedent calling for
"considerable deference" to a district court's
factual findings under the Polaroid analysis does not obviously
"comport[] with the general standard of review at summary
judgment."
Sales to Government Entity May Be "Sufficiently
Public" to Establish Use in Commerce: FN Herstal SA v.
Clyde Armory Inc., No. 15-14040 (11th Cir. Sept. 27,
2016)
Coogler, J. In a trademark dispute between two firearms
companies, the Eleventh Circuit affirmed the district court's
finding of trademark infringement following a bench trial. The
plaintiff had won a heavily publicized US military contract
competition for design and manufacture of a rifle dubbed the
"SCAR," and shortly thereafter began extensive promotion
of a "civilian version" of the SCAR rifle to law
enforcement and civilians. The Eleventh Circuit upheld the district
court's conclusion that the plaintiff's sales of
SCAR-branded rifles to the US military alone were
"sufficiently public" to establish use in commerce of the
mark prior to the defendant's first sale of rifle stocks marked
"SCAR-Stock." The court also affirmed the district
court's alternative holding that the plaintiff's "open
and notorious" marketing efforts to law enforcement and
civilians were sufficient to establish priority under the
"analogous use" doctrine—even though the civilian
version of the rifle was not available for actual purchase until
after the defendant's first sale. Based on evidence of
extensive media attention and marketing efforts, the court further
upheld the district court's finding that the plaintiff's
SCAR mark had acquired secondary meaning prior to the
defendant's use of the mark. Finally, the Eleventh Circuit
rejected the defendant's "unlawful use" defense to
infringement—based on the plaintiff's alleged violation
of regulations and statutes prohibiting unauthorized disclosure of
information pertaining to military contracts and unauthorized use
of certain military emblems—noting that it had never adopted
the unlawful use doctrine and that, even if the doctrine were
applicable, the plaintiff's conduct was not a per se violation
of the relevant regulation or was not so significant as to prevent
it from acquiring trademark rights in the mark.
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