Tuesday, May 3, 2016

Supreme Court to Decide New Patent Rules

The government recently made it easier for companies and/or individuals to challenge patents without fighting in Federal courts.  It is no secret that patent litigation is one of the most costly and lengthy legal battles possible.  The new process allows the United States Patent and Trademark Office ("USPTO") to make a determination about the patent dispute.  Of note is the fact that the USPTO would use different legal standards to resolve the issues.  This would mean that a Federal court judge and the USPTO could reach different conclusions over the same dispute.

The case before the Supreme Court comes after Congress "updated" the patent laws in 2011.  The issue before the Court is whether the USPTO rules must conform to the legal standards the courts use in adjudicating a patent dispute.

One of the purposes of the 2011 overhaul was to cull bad patents and discourage patent trolls (those who buy patents who do not manufacture the patented item, but merely assert those patents against others).  As you can imagine, because patent litigation is so costly, many patent trolls found success in suing companies for patent infringement.  In many instances, it was a better business decision to pay the patent troll rather than fight the issue in court.

Personally, I like the idea of a less expensive process allowing litigants to get resolution in patent matters.  However, I fear that the parties would go through the USPTO process and then the "loser" would decide to initiate a lawsuit which would put the parties in the unenviable position of having to pay twice for an adjudication of the same issue.

Wednesday, April 27, 2016

Another Company Changes Its Name to Distance Itself from a Prior Bad Association

Fisker Automotive changed its name to Karma Automotive in order to disassociate itself from its predecesser.  Fisker Automotive stopped producing vehicles in 2012 amid financial difficulty and a recall that led to bankruptcy.  Now, Chinese auto parts company, Wanxiang Group owns Fisker Automotive and decided to distance itself from the prior name in favor of Karma Automotive.  Karma Automotive is working to develop a luxury electric car which it hopes to start selling this summer.  

It makes sense, in today's markets, to try to maintain a strong brand and to distance oneself from tarnished brands.  That is certainly one of the reasons why Fisker decided to re-brand itself.  This is especially true since Fisker received a loan from the Energy Department in 2009 and caused the energy agency to lose $ 139 million on that loan when Fisker filed for bankruptcy protection.  

This is another example of how important a company's trademark or trade name can be and how it is virtually essential to maintain a strong one.  

Wednesday, March 2, 2016

This Trademark Dispute is Not Funny

Apparently, there are two Comic Cons.  There is the San Diego Comic-Con and the Salt Lake Comic Con (note the hyphenation and lack thereof). As you may have guessed, the San Diego outfit sued the Salt Lake one for trademark infringement.  One of the main questions was whether the removal of the hyphen in the name mattered.  Usually, it would not. Unsurprisingly, the San Diego convention argued that it owned all iterations of "comic con" in all of its possible variants.  The Salt Lake one countered that the term is a general term for the type of convention, and therefore, is not trademarkable.

Nevertheless, it appears that these two conventions are working on a settlement because they asked the judge for more time to iron out some of the details.

Wednesday, February 10, 2016

Lawsuit Over Copyright of Happy Birthday Song Settles

In a strange lawsuit, a movie producer, Jennifer Nelson, sued music publisher Warner/Chappell over whether she had to pay royalties to use the Happy Birthday song in her documentary.  Her documentary was about the history of the song.  Ms. Nelson claimed that Warner/Chappell did not own the rights to the song, and therefore, could not charge her royalties.  
Patty Smith Hill and her sister Mildred J. Hill wrote the tune in 1893 with the title "Good Morning to All."  From what I understand the Hill sisters were teachers and included the song in a children's music book.  They left the copyright with their publisher.  Somewhere along the convoluted history of the song, the "Happy Birthday" lyrics were added.
In 1988 Warner began collecting royalties for the song.  Warner had purchased the company that obtained the copyright from the Hill sisters' publisher sometime around that time.  To add to the complexity of the case, two other groups claimed a right to the song's copyright:  The Association for Childhood Education International ("ACEI") and the Hill Foundation.  ACEI was a charity designated by the Hill family to receive a portion of the song's licensing profits.  The Hill Foundation and ACEI claimed that they were the actual copyright holders of the song.  
Earlier in the lawsuit, the District Judge ruled that neither Warner nor the prior companies had the right to charge for use of the song--the Judge did not rule on the issue regarding whether the song is in the public domain.  
Ultimately, Warner/Chappell agreed to pay $ 14 million to settle the class action lawsuit.  In addition, they have given up their claims to the song which means that the song falls into the public domain for everyone to use without having to pay a royalty.  Now, the District Judge will need to approve the terms of the settlement for the settlement to be final.  
According to documents filed with the court, the settlement is the result of intense "around the clock" negotiations during the week before the scheduled trial.  The settlement includes ACEI and the Hill Foundation.  No party to the settlement agreement admits wrongdoing and Warner denies that the song is in the public domain.  

Tuesday, December 1, 2015

AstraZeneca Is Giving a Generic Drug Maker Heartburn

When I was in law school, one of the hot topics in the trademark world was whether "color per se" (color without more) could act as a trademark.  At the time, there was a Circuit split regarding whether "mere color" could receive trademark protection.  Some of the cases involved the color of fake sugar packets, the color of insulation, or the color of cleaning press pads.  In 1995, it was the cleaning press pads case where the Supreme Court resolved the question about the trademarkability of color per se.

In that case, the Supreme Court ultimately ruled that, as long as the color had acquired distinctiveness (secondary meaning), then it may obtain protection as a trademark.  In other words, if consumers came to understand that the color indicated the source of the product, then color is trademarkable.

Today, AstraZeneca is arguing that the color purple of its heartburn pill, Nexium, is a protected trademark.  In so doing, AstraZeneca is able to block a generic drug maker from selling its generic version of Nexium.  AstraZeneca notes that it heavily promoted Nexium as the "purple pill."  It is this big advertising campaign which helps consumers to come to connect a purple pill with Nexium.

If you have read this blog before, you will know that having a trademark registration allows a trademark owner to block the importation of infringing goods.  This is what I believe AstraZeneca did to the generic drug manufacturer trying to get its generic Nexium here.  If I were to guess, I would say that the generic drug manufacturer will have to choose a different color for its generic Nexium before it could sell it here in the United States.

Tuesday, November 24, 2015

Understanding California's Fair Pay Act

After the hack of Sony's e-mails and the revelation of the pay inequality in Hollywood between male actors and female actors, there was a call by some of the actresses for fair pay.  You may recall Patricia Arquette's acceptance speech at the 2015 Oscars wherein she called for wage equality.  That spawned action at the California Legislature to enact the California Fair Pay Act.  Gov. Brown signed the law in early October.  So, what does the law do, you ask?

Well, it ensures that male and female employees who perform "substantially similar" work are paid equal wages.  This language is broader than the "equal work" language in the prior law.  This is true even if they have different job titles or work in different offices of the same employer.  There is also an anti-retaliation component to the law which allows co-workers to discuss their wages with each other without fear of punishment by the employer.  Only merit, seniority, quantity/quality of production, or a "bona fide" factor other than sex that is a legitimate business necessity are allowable explanations for wage differences between male and female employees.  

All businesses (public and private) must comply with the law.  However, keep in mind that the business must have both male and female employees doing the same or similar work.  For example, most nurses are women.  If your company has only women who are nurses, then there is no way to apply the law because there would be no male nurse's wages to compare with the female nurses.  Of course, this "loophole" (for lack of a better term) existed in the prior equal pay law.  

With this law, California remains at the forefront of employee protection.  

Thursday, November 19, 2015

There is No Way to Sugar Coat It: Corn Syrup v. Sugar!!

UPDATE:  The parties settled the litigation in the middle o trial.  The terms of the settlement are confidential.

Earlier this month, the trial between the sugar industry and the high fructose corn syrup producers began in a Federal court.  The sugar industry sued the corn syrup producers for falsely claiming that their product is just as healthy as sugar.  Not to be outdone, the corn syrup producers shot back with a claim that the sugar industry engaged in a lengthy misinformation campaign.  It would seem strange that the two would be fighting over allegedly false claims about the health information of their products. This is especially true given that both products have been linked to a host of health ailments (obesity, tooth decay, diabetes--just to name a few).

The sugar industry claims that the corn syrup producers' ads claiming that corn syrup is "nutritionally the same as table sugar" and "your body can't tell the difference" between the two sweeteners is false. They further claim that the corn syrup producers know these claims are false.  The corn syrup producers counter that argument with a claim that the ads were an "educational campaign" to correct ten years of falsehoods made by the sugar industry about their product.  They also claim that the lawsuit is nothing more than the sugar industry's attempt to throttle its competition.

This one may be a fun one to watch.  Stay tuned!