Intellectual Property Outline by JohnMValentine

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									Intellectual Property Outline
I. Trade Secrets a. Generally 1. Subject Matter A. any kind of information that derives economic value from not being generally known, and B. the information is subject to reasonable efforts to keep it a secret 2. Scope of Rights A. cannot be misappropriated 3. used to be a common law tort 4. under TRIPS treaty, the US must protect trade secrets 5. Uniform Trade Secrets Act (UTSA) A. 47 states have adopted it 6. Elements of a claim A. the information has independent economic value because it is not generally known or ascertainable B. the information is subject to reasonable security C. the information was misappropriated b. What does it mean to have a trade secret? 1. a secret with independent economic value because it is a secret 2. reasonable security is put over the secret A. reasonableness is fact dependent i. value of secret vs. cost of security, etc. 3. evidence of economic value A. the secret enables faster or better production B. failure also has economic value i. entitled to negative know-how 4. ways a secret can cease being a secret (i.e. becomes readily ascertainable) A. public disclosure i. publication, reverse engineering, etc. ii. obscure-ness of the journal or publication as a factor is a close-call iii. look to policy to determine answer [a]. innovation vs. commercial morality iv. internet publication does not necessarily destroy the secret [a]. focus on “readily ascertainable” v. policy – do we care more about regulating commercial players or disseminating information? B. a patent expires


i. while the patent application is pending, it is not considered public or published c. Reverse Engineering 1. usually requires some knowledge of the class of product or process A. can be a method of IP enforcement i. find out if your IP was stolen or used 2. by itself, it is not misappropriation A. but as a matter of policy, why is it considered proper? i. as an equitable matter, the defendant is expending resources on a product they purchased ii. when competitors come out with a product through reverse engineering, it benefits consumers [a]. brings prices down and promotes the competitor to make a better product iii. can reverse engineer under patent law, but cannot use it [a]. thus, it is an incentive for getting a patent because patent prevents reverse engineering 3. can give rise to 2 defenses A. not a secret i. readily ascertainable through simple reverse engineering B. if it is a secret, reverse engineering is a proper means of discovering it d. Claim for Trade Secret 1. I own a trade secret A. it is a secret B. it has independent economic value C. I took reasonable methods to keep it a secret 2. you misappropriated it A. inappropriate means, or B. breach of confidentiality e. Misappropriation 1. USTA §1(2) A. if secret is gained through “improper means” f. Non-Competition Agreements 1. are they valid? A. basic contract law i. need consideration B. also a notion of fairness i. can meet basic contract requirements, but violate public policy ii. i.e. freedom of employee mobility


iii. therefore, courts will enforce NCAs unless they violate public policy and fairness [a]. in this way, a judge can change an NCA from 5 to 2 years [b]. essentially, the judge re-writes the contract, but calls it upholding public policy C. if there is a trade secret at stake, it makes the NCA look more valid i. but “reasonableness” divides courts D. legally drafting NCAs i. Carroll – 2-3 years is usually ok [a]. all depends on applicable case law [b]. want to avoid being over aggressive [c]. it can come back to bite you – do not want competitors to use aggressive NCAs because then you can‟t hire their employees [d]. the NCA term must be part of the contract for the work done or else extra consideration is needed g. Inevitable Disclosure Rule 1. employees will inevitably disclose/misappropriate trade secrets A. inevitable because it is in their head and it will come out with similar work 2. usual remedy sought – the individual cannot continue working in the same line of work A. more limited – can work for a competitor, but not in a certain division or department 3. is there a middle ground? A. Carroll – impose an injunction not to misappropriate the secret i. thus, can still take the job, but can‟t use trade secret ii. if the employee does, he is violating trade secret law and a court order 4. the way the job change took place is significant A. if competitor solicited the employee and did so in secret i. pushes in favor of the doctrine h. Remedies 1. possible remedies A. injunction B. damages i. lost sales, etc. ii. difficult to prove C. unjust enrichment i. recover the defendant‟s profits attributable to the misappropriation ii. but it is difficult to show how much is attributable


D. court can impose a reasonable royalty i. usually have to look at the licensing market ii. difficult to do for trade secrets E. if a claim of misappropriation is made in bad faith, can award attorney‟s fees ii. harder to get in trade secrets than it is in copyright 2. elements for an injunction A. equitable relief i. damages are not adequate or equitable at law B. it is not inequitable for the defendant C. the plaintiff is likely to succeed on the merits i. for a preliminary injunction D. harm is likely to incur without an injunction i. for a permanent injunction E. the public will not be harmed 3. USSC A. common law elements for injunctions apply to IP law i. need to look at effect on defendant and public interest 4. if the 4 elements of an injunction are met, the fight is over the scope of the injunction A. what precisely do you want the court to tell the defendant to stop doing? i. Metallurgical Industries v. Fourtek 1. based on Texas tort law before it adopted the UTSA 2. secret A. a way to modify machines to better reclaim carbide from metals i. a process rather than a product B. the company did not originally label it a trade secret C. 3 modifications were made i. the individual changes themselves were not secret, but their combination into a process was ii. indicates that you really need to know the facts of the industry to know that it is a secret 3. how do you prove that there was economic value because the secret was a secret? A. quantity – made more money after the process was discovered and completed B. quality – the quality of the product had increased C. market value – does the secret change the market value? 4. evidence of security measures A. confidentiality clauses to buyers, investors, etc. B. the company physically restricted access to the secret by the public 5. Court


A. the company disclosed the trade secret, but only to 2 other companies i. this was a limited disclosure whose purpose was to advance their own economic self-interest ii. this did not destroy the trade secret B. the defendants got the secret because they were there when the secret was formed i. originally were employees of the plaintiff C. wrongful act i. the defendants will use the process in building/modifying a machine ii. they will use the trade secret in their business 6. Is the court more concerned with innovation policy or commercial morality? A. should it matter if the misappropriation came from the inside or outside? i. if yes, the concern is over commercial morality B. innovation policy i. if it is no longer a secret, it is no longer protected ii. public information should be useful to all competitors iii. thus, if disclosure to B destroyed the trade secret, then X has no claim against A iv. public ascertainable information is not protected C. UTSA i. §(4)(i) – the actual source of the information does not matter ii. once it is readily ascertainable, it is not longer a trade secret because it fails the first prong of subject matter 7. customer lists A. they can have independent economic value, but it is not necessarily a secret i. issue is whether it is readily ascertainable j. Rockwell v. DEV 1. summary judgment was improper because the question over reasonable efforts to keep a secret is facts intensive 2. why is evidence of “reasonable efforts” required for a trade secret? A. evidentiary value B. not able to rely on the law for all protection i. i.e. you can build a fence around your property, but if someone jumps it, then the law must step in C. do not want the standard to be so high that it creates unnecessary expenditures 3. really a case of whether it is still a secret A. question of “readily ascertainable” B. though the facts support an effort or ascertainable claim


4. advising clients A. use confidentially agreements or non-disclosure agreements B. have security cards, etc. k. DuPont v. Christopher 1. plaintiff‟s claim A. the defendant flew over plaintiff‟s plant and took pictures i. discovered the secret process by doing so 2. defendant‟s defense A. it is only “improper means” if it violates some other law i. i.e. trespass 3. improper means? A. the defendants were hired by a 3rd party to take photographs B. a standard for conduct which is otherwise lawful i. should be some kind of intent to do something improper 4. Court A. to protect the secret, DuPont would have had to put up a temporary cover i. not economically reasonable B. what does this mean? i. if the defendant used improper means, ask what else the plaintiff could have done ii. sort of shifts the burden back onto the secret holder l. Smith v. Dravo 1. Smith had an original, innovative design for a shipping crate A. the defendant wanted to either invest in, or buy, plaintiff‟s business i. the defendant received patent applications, blue prints, letters from potential users, etc. B. the negotiations fail i. the defendant then releases his own line of containers ii. because of different dimensions, and other innovations by the defendant, plaintiff‟s containers become obsolete iii. a standards market – only wants one size of container 2. was there a confidential relationship? A. no express agreement B. plaintiff says it was implied because of the business relationship i. the defendant would argue that the lack of an express agreement meant there was no agreement at all ii. and even if it was implied, what was the scope? [a]. agree not to publish? To use? Etc. 3. Implied agreements A. look to the facts to determine the party‟s understanding and scope


m. Kadant v. Seeley 1. trade secret A. new products for cleaning the machines that make paper 2. defendant was a former employee of the plaintiff A. was promoted to a position with access to the trade secret B. misappropriation would be breach of a confidential relationship i. could also have been improper means 3. But did the defendant misappropriate the secret or reverse engineer it? 4. evidence A. the plaintiff said is was done too fast to be reverse engineering i. defendant countered that the reverse engineering was not hard and that not all products were reverse engineered 5. evidence usually looked for A. defendant‟s plan to misappropriate B. was the defendant in a position with access to the trade secret? C. how much input did the defendant have I reverse engineering? n. Wexler v. Greenberg 1. case of trade secrets leaving with a former employee 2. Wexler was not asking for Greenberg to be fired A. only that he not use the trade secret or sell products made from them B. Wexler did not really teach the trade secret to Greenberg i. Greenberg created it and then it became Wexler‟s 3. 3 kinds of inventors A. an employee hired to invent i. secret belongs to the employer B. invents with the employer‟s time and tools i. employer has a shop right C. independently invents i. belongs to the inventor 4. usually an implied duty of confidentially not to use the trade secret A. what about where a employee creates a customer list and takes it with him? i. usually considered misappropriation, but somewhat limited 5. in terms of law firms A. skills learned at a firm go with the lawyer i. cannot prevent the use of skill, but can say that a lawyer is not able to compete with the original firm o. Winston Research v. 3M 1. technology – tape/record recording machines A. there is a known problem with known factors for a solution B. trade secret


i. mix of factors which solve the problem ii. a narrow trade secret – the process, not the technology 2. remedy A. head-start injunction i. enjoin the use of the trade secret for a period of time ii. middle ground from a permanent injunction iii. preserves the monopoly B. how to determine length of time? i. reasonable length of time it would take to reverse engineer?

II. Patent a. Generally 1. Patent law is referred to as the strongest form of IP A. cannot claim copyright or trade secret if the product or process was independently created i. patent does – getting to the patent office first matters ii. it stimulates innovation – want the “prize to be worth the race” 2. requirements A. subject matter B. utility C. novelty i. “prior art” – prior invention or disclosure ii. if the invention is referred to in the prior art, it fails §102 iii. however, if the prior art has A, B & C, but not A, B & C together, the combination is novel D. obviousness (§103) i. the invention is not something that an ordinary person with reasonable skill in the field would know 3. subject matter A. 4 areas that are covered by patents i. machine ii. manufacture iii. composition of matter iv. process 4. patent does not give an affirmative right to use the patent A. only grants a negative right to exclude i. gives power back to the inventors B. encourages cooperation between inventors and the patent holder 5. negatives of patents A. it is harder to get a patent than other forms of IP


i. becomes an analysis of whether the cost is worth the rights ii. it can cost between $10,000 - $50,000 iii. on average, the rights aren‟t worth that much B. must prosecute one‟s claim for a patent at the patent office C. for example, IBM advertises that it has the most patents i. probably to signal that it is a leading company with cutting-edge technology ii. and, that the huge patent portfolio is worth more than the individual patents iii. this leads to newcomers or competitors entering into a deal with IBM rather than go through all the patents 6. anatomy of a patent A. patent # i. sequential number going back to the 1700‟s B. prior arts (references cited) i. any prior invention or previously known information C. background i. summary of the invention and prior art ii. preferred embodiment [a]. the preferred physical manifestation of the invention [b]. if there is one, it must be disclosed D. inventor claims the invention i. can be much broader than the illustration, but every word in the claim effectively limits the claim ii. claim 1 is usually an independent claim and the other claims are dependent off of claim 1 7. Reforms have benefited bio-tech and software A. non-patentable material i. laws of nature ii. physical phenomena (simple discovery not patentable) iii. abstract ideas [a]. the idea must be embodied in something useful b. Utility 1. useful for what purpose? How useful? 2. where this requirement has bite A. new technologies 3. not a “hunting license” A. not enough to say that it will be useful B. must be useful now 4. general utility A. the object, process, etc. must be able to do something B. even if it does, it must be useful


c. Novelty 1. measured at 2 time periods A. §102(a) – new at the time of invention? B. §102(b) – new at the time of filing? 2. terminology A. use the word “anticipated” i. were there embodiments of the claims in the patent in use by the public? ii. if so, the claim is anticipated iii. it does not have to be exact, but within the scope to be anticipated iv. as long as something the claim would “read on” was in public use 3. statutory bars (§102(b)) A. it cannot be patented if it has been publicly disclosed at least a year before filing i. a one-year grace period between disclosure and filing 4. §102(a) A. was it new at the time of invention? i. are there prior patents on the products? ii. was it publicly disclosed? iii. was there a prior art where the technology was used [a]. only public, not private use, anticipates a patent 5. Doctrine of Inherency A. example i. A owns a process ii. the process has an unintended result of producing X, and A is unaware of the production iii. B then finds a use for X and tries to patent it iv. Courts – if the production is unintended and unknown, it is not anticipated [a]. but, if the production is known, then it is public knowledge and anticipates the invention d. Non-obviousness 1. what is meant by non-obvious? A. “to a person having ordinary skill in the art” i. if this person was put in the position of solving the problem the inventor as trying to solve, would the person think the inventor‟s solution was obvious based on prior art? 2. evidence used to determine obviousness (taken from Grahm) A. the prior art i. its scope and content B. what is the difference C. level of ordinary skill in the pertinent art


i. would it be obvious to a person of ordinary skill? ii. must show obviousness at the time of invention 3. secondary considerations A. commercial success i. commentators find it to be the least helpful B. unresolved needs i. the needs would have created a market for the product, and if the invention were obvious, someone would have made it to take advantage of the market C. failure of others i. the Federal Circuit essentially turned this into a 4th main factor ii. beware of hindsight bias – things look more obvious later 4. Grahm v. John Deere Co. A. the constitution gives Congress the power of patents and copyright i. a limit on what Congress can do [a]. may not issue patents which remove knowledge from the public domain ii. public domain [a]. absence of IP [b]. in this case, public domain means the patents have expired iii. question – which branch of the public domain? (copyright, etc.) [a]. can be in the public domain for one but not the other [b]. i.e. a secret is disclosed but it is still a copyright B. invention i. a spring-enhanced plow [a]. not the first of its kind, but an improvement on prior art [b]. moved the shank from the bottom to the top e. Enablement 1. UPA §112 A. requirements – the description of the invention must i. enable one skilled in the art to practice the invention ii. establish that the inventor possesses the application at the time of application [a]. i.e. did the inventor have the invention at the time of application iii. disclose the inventor‟s best mode for practicing the invention


B. (i) – the enablement requirement is met when the description teaches one skilled in the art how to make and use the invention i. i.e. the light bulb case – the claim listed carbonized fiber as the conducting material ii. however, not all carbonized fiber worked iii. thus, the claim was not enabled (valid) because it did not teach one skilled in the art how to make and use the invention iv. want to limit the claim if the potential broad claim would not always be enabled C. (ii) – written description i. sometimes called the “specification” ii. puts the claim in context iii. describes the problem the invention solves and at least one embodiment of the invention D. (iii) – best mode i. an “intent” test – prove that, at the time of application, the inventor had the best mode ii. 2 questions [a]. did the inventor have a preferred embodiment? (subjective) [b]. if yes, was the embodiment adequately disclosed in the written description? (objective) f. Infringement 1. a lot of uncertainty over patent claims because of language 2. general rules of reading a patent A. go to language and apply plain meaning unless patentee gave a special definition or if one skilled in the art would use a special definition B. read the language in the context of the written description 3. Phillip‟s case A. Federal Circuit can review District Court decisions de novo i. no real test or guidelines on which sources matter in defining language g. Claim Drafting 1. a patent claim usually has 3 elements A. the introductory phrase B. the body of the claim C. the link that joins the two 2. every word put into a claim acts as a limitation 3. elements example A. a data input device B. an input surface…. 4. magic words/connecting terms – comprising, consisting of, etc.


h. Remedies 1. normal rule A. if you win the infringement suit, you get an injunction 2. USSC departs from the normal rule in the eBay case A. adopts 4 factors for law of equity i. injunction is an extreme relief – the right to exclude is not automatic or absolute ii. patents are not outside the laws of equity iii. USSC gives power back to the District Court to determine equity B. reasons for holding i. companies using injunctions to pressure others into large settlements ii. Federal Circuit treating patent law as different and special i. Diamond v. Chakrabarty 1. invention in question A. a bacteria that eats oil i. plasmids were injected into an organism ii. the bacteria did not naturally occur in nature B. also seeks to patent the process and carrier method i. court finds this to be ok C. but can you patent a living organism? 2. argument against A. there are two prior Congressional acts holding that living organisms are not patentable i. Plant Act of 1930 and Plant Varieties (gave special patents for plants) ii. as a general matter, Congress did not intend for living things to fit under “manufacture or composition of matter” patents B. argument is that such a policy question should be left to Congress i. interpret statutes narrowly, and let Congress change it if it disagrees 3. Court A. finds that bacteria can be patented i. want to stimulate and promote innovation ii. if it is wrong, leave it to Congress to change 4. Carroll – does it follow that a genetically altered human is patentable? A. would argue that all that USSC dealt with was a simple microorganism i. would argue that Congress did or did not intend for mammals, humans, etc. to be patentable


5. Parke-Davis v. Mulford A. what about patenting something that is naturally occurring? i. a purified version made by man is patentable j. Brenner v. Manson 1. review of a Patent Office rejection 2. patentee‟s claim of useful A. patentee‟s compound is similar to an existing compound i. the differences are minor, but enough for comparison ii. the existing compound inhibits tumors in mice iii. the use is a research use [a]. probably useful because of existing compound 3. Court A. patentee must show an actual use i. not enough to speculate usefulness based on similarity to existing, useful compounds ii. risk – if a patent is given too early in development, it inhibits other inventors iii. means the patentee has to fund R&D without the patent [a]. Carroll – this is difficult to do 4. only has to be useful for some purpose to meet utility threshold A. you do not have to meet the intended use i. if you own the patent, you own it for all uses ii. trick – find some use in order to get the patent k. In Re Fisher 1. Federal Circuit A. separate court of appeals that hears patent appeals B. given patent review because different Circuits would reach different ruling on the same patent 2. involved the patent of an express sequence tag (EST) A. marked cDNA, which is a copy of mRNA which copies part of DNA B. ESTs are essential to DNA research i. file a lot of patents in the hope of cashing in on research 3. Federal Circuit in this case A. ESTs could be used in research, but we do not know what sequence is being expressed i. not useful because Fisher did not know what the cDNA expressed ii. it marks a thing, but we don‟t know what it does B. reversal from Federal Circuit‟s actions since Brenner i. court had lowered utility threshold for research projects ii. the court had previously found utility in ESTs because they are useful in research


iii. but, such a decision would have greatly increased research costs C. dissent i. making a thing so you can study something else better is like a microscope, which is useful ii. majority‟s answer – a microscope gives immediate benefits, but with ESTs it is questionable D. general result i. changes the utility threshold for ESTs, but not other research tools l. Rosaire v. National Lead Co. 1. attempt to patent a process for prospecting for oil A. the process was used by another i. public use – was used out in the open ii. not have to prove that it was publicly seen, but that it could have been B. argument i. it was not in use because the other group had abandoned the process because they did not know that it had worked 2. Court A. other business issues caused the other group to stop using the process i. it was not abandoned m. In Re Dembiczak 1. invention A. an orange trash bag with a jack-o-lantern face 2. Grahm analysis A. present in prior art i. 4 references which, in the aggregate, suggest the invention [a]. book from teachers and other plastic bags B. obvious to one skilled in the art? i. need to show a teaching or suggestion to combine the prior arts ii. easier to get a patent because the prior art alone does not defeat obviousness iii. must be a teaching, suggestion or motivation (TSM) of combining the prior art to make it obvious 3. patent is valid A. the court did not find a TSM for combining the prior art n. KSR International Co. v. Teleflex Inc. 1. car industry moving from mechanical to electronic gas pedals A. puller, wire and lever system vs. computer system


B. a person‟s size can effect the ability to depress the pedal i. solution – put the pedal on a pivot C. case arises because the manufacturers want to combine the electronic system with a pivot i. it is novel, but is it obvious 2. Federal Circuit A. not obvious i. applied a rigid version of the TSM test 3. USSC A. the Federal Circuit‟s test was too rigid i. common sense must be part of the analysis, but must be accompanied by facts ii. an expert gave a conclusory opinion that it was obvious [a]. does not create a genuine issue of material fact 4. the Federal Circuit changed the first element of the Grahm analysis A. prior art to be considered is only the prior art used to solve the problem B. the USSC says this is too narrow i. relevant prior art includes all prior art known ii. this significantly changes non-obviousness cases – makes it easier to show obviousness because there is more prior art to pull from o. Larami v. Amron 1. goal of patent A. to create a better water gun 2. similarities and differences A. doctrine of equivalents i. a very small modification to try to move invention outside scope of patent ii. if the invention is substantially equivalent, the claim is still infringed B. both products are pressurized water guns i. but Amron‟s gun lights up and makes noise 3. literal infringement A. all elements of plaintiff‟s claim must be present in the defendant‟s invention for there to be infringement B. plaintiff used the phrase “appreciable amount of pressure” i. did not set an exact amount or range ii. could not set a range with impossible values because then it would not be enabled (inventor would not possess it) 4. Larami‟s (Super Soaker) defense A. focused on certain words i. “elongated housing,” “having a chamber therein for liquid,” etc. ii. what is meant by “therein”


iii. Larami says “therein” means a chamber inside, but Amron says the Super Soaker does have a small chamber inside 5. Court A. rules for Larami

III. Copyright a. History of Copyright 1. reproduction technology A. invented by John Gutenberg in 1450 B. derived from presses farmers used to make olive oil 2. English printing privilege A. all monarchs wanted the technology B. the printing business went through a brief period of unregulated development i. during the Reformation, however, political and religious authorities perceived it as a threat ii. monarchs began to regulate the industry [a]. get a monopoly in exchange for political approval [b]. did not like copyright because the right was with the publisher, not the author 3. Guild copyright A. allocated rights among themselves to create specific texts 4. End of royal privilege A. with diminution of monarchical power, regulation was done by statute B. Licensing Act of 1662 was allowed to lapse in 1694 and the book trade became a free market again 5. Statute of Anne A. publishers, backed by some authors, prevailed upon Parliament to enact first modern copyright law B. 2 features i. statutory right belongs to the author ii. exclusive right is for a limited time 6. US Constitution Article § 8 clause 8 A. Congress shall have the right to promote the progress of Science and the Useful Arts by securing for limited times to authors and inventors the exclusive right to their writing 7. Changes to copyright law A. Congress changes the law in response to specific technologies i. however, Congress sometimes gets it wrong [a]. provision of the Copyright Act on digital audio tapes and players


[b]. not really important because the industry went to CDs instead ii. record companies wanted a performance right for digital satellite radio [a]. if you play a song over the radio, only have to pay the artist [b]. but digital radio stations have to pay the artist and recording company iii. power has been distributed to end users [a]. so, copyright owners have incentives to get public enforcement [b]. but these agencies only prosecute criminal violations [c]. so, there has been an expansion of criminal implications/liability for IP [d]. i.e. criminal liability for swapping software online B. DMCA (§ 1201) i. biggest hope for copyright owners is technological barriers to infringement [a]. i.e. region encoded DVDs [b]. plus, a player can only get a DVD license if it puts in the region encoding ii. the law makes it a criminal offense to circumvent the technological barriers or to traffic the circumvention techniques 8. International copyright A. copyright industries themselves have not agreed on who‟s copyright law applies B. copyright law has become a species of trade law on an international level i. trade in IP goods was not included in GATT until 1994 ii. must protect copyright law in certain respects to be a member of the WTO [a]. not just have copyright laws, but protect them as well iii. if a member of the WTO, an owner‟s copyright rights extend to all member nations [a]. for example, a US owner could sue an infringer in France [b]. can get the benefits of the country in which the infringer is sued even if not available in the copyright holder‟s home country C. IP rights have become an international marketplace i. important to know who‟s law applies D. copyright owners will use the Executive to expand US rights


i. will get copyright rights put into treaties with other nations ii. then, will go to Congress saying that US law should be expanded to fall in line with the treaties the US is a part of b. Features of Copyright law 1. historically, legislation was the product of business-to-business relationships A. however, copyright law is political and subject to change 2. Copyright legislation A. first statute was enacted in 1790 i. provided the right to publish “maps, charts and books” ii. lasted for 14 years and was renewable for another 14 B. Copyright Act of 1909 i. perpetual common law copyright prior to publication ii. if published without notice, the work was deemed to enter the public domain iii. term was 28 years and was renewable for 28 years C. Copyright Act of 1976 i. abolishes, with some exceptions, common law copyright [a]. becomes exclusively federal ii. term is extended to life of author plus 70 years, or 95 years if the work is “made for hire” iii. ended formalities of copyright – the affirmative steps needed to get a copyright under the 1909 Act iv. extends protection even if the work is published without notice v. however, the author must register the work with the Copyright Office before bringing suit 3. Subject Matter A. must be an original work of authorship (requirement 1) i. originates with the creator ii. displays a modicum of creativity B. fixed in a tangible medium (requirement 2) i. stable enough to be perceived or communicated C. in the case of multiple authors, each only owns what they have contributed D. modicum of creativity i. can be thin – only minimal creativity is required c. Examples of copyright areas 1. § 102(a) A. literary works (includes software), musical works (including lyrics), dramatic works (includes music), pantomimes and chorographical works, pictorial, graphic, and sculptural works,


motion pictures and other audiovisuals, sound recordings and architectural works 2. music copyright encompasses lyrics and underlying notes 3. sound recording A. process of fixing the sound into the recording B. performers make choices regarding rendering the sound i. authorship could also belong to the producer or sound engineer C. no performance right (exception for sound recordings) i. result of lobbying by broadcasters [a]. do not want to pay for music copyright and recording copyright 4. architectural works A. if the work can be seen by the public, it can be photographed or filmed without infringement d. Limitations 1. fact/expression A. facts do not have authors i. one cannot own facts ii. thus, you cannot own the rights to things that happen to you B. facts are not elements taken from a work (like a TV show) i. facts are things that really happen ii. i.e. reality TV shows can own a copyright in an original expression of the events C. estoppel theory i. if “fake” events are presented as facts, the author cannot claim copyright 2. idea/expression A. copyright does not cover ideas B. Baker v. Selden i. plaintiff put out a book on bookkeeping methods with charts ii. the defendant also put out a book with the same methods, but did not actually copy the text iii. nobody really knows what the holding is iv. the plaintiff can own the words, but cannot own the system [a]. thus, cannot own the charts because it would be owning the system 3. merger doctrine A. when there is only one of a few ways to express an idea, courts will find that the idea merges with the expression and is not copyrightable 4. example of Baker v. Selden


A. take Microsoft Word i. there are menus listed up at the top called “file,” etc. ii. are the words a simple choice of words or an expression of commands iii. not copyrightable of an idea iv. or, not copyrightable under the merger doctrine if the command structure is an industry standard v. becoming an industry standard merges the idea into the expression 5. function/expression A. functional, useful things are not copyrightable B. conceptual severability i. if the design of an object is a function of its utilitarian purpose, it is not conceptually severable ii. it is severable if the artistic design is not necessary to the utilitarian purpose/function C. Brandir v. Cascade Pacific Lumber i. bike rack was not copyrightable ii. artistic changes were made so that object could function as a bike rack iii. the design is intertwined with the article‟s utilitarian aspects D. clothing is generally considered a useful article i. thus, Halloween costumes are not copyrightable E. way to prevent back-door patents i. want useful items to go through patent channels F. sound recordings i. right of reproduction is limited to an exact copy e. Copyright Act § 201 1. author owns the copyright when it is created 2. who is the author? A. individual creator who uses no pre-existing expression 3. § 201(b) – Work Made for Hire doctrine A. the employer is the author in a work made for hire i. unlike patent law where the patent is assigned to the employer, but the inventor gets credit B. codified in 1976 C. 2 classes of works made for hire i. prepared by an employee within the course and scope of employment ii. a work specifically ordered or commissioned for use [in one of nine categories] [a]. this matters for independent contractors


[b]. exception – the employer and employee can enter into a written agreement that the work is not a work made for hire D. why the doctrine matters i. if it is a work made for hire, the employee cannot reclaim it later ii. plus, length of copyright changes if made by a natural person or an entity f. Joint Authorship 1. joint work A. prepared by 2 or more authors with the intent that their contributions be merged into a whole 2. Almuhammed v. Lee A. case involving the movie Malcolm X B. Almuhammed does many things for the movie makers i. does it amount to a joint work? ii. consequences – Almuhammed could fully exercise the copyright with a share of the profits C. Court i. not a joint author because Almuhammed is not an author ii. “authors” here means control over the final product [a]. for purposes of joint authorship 3. Rent case A. dramaturge was an author, but the intent standard was not met i. the other explicitly said he was the only author ii. the dramaturge still has a copyright for the contribution, but does not own half of the copyright in the finished work g. Software copyright 1. should have a contract with the software developers to make the allocation of copyright clear 2. source code vs. object code A. software is a set of instructions that tell computers what to do B. object code – binary code that is readable to humans as “1” and “0” C. source code – actual human programming language (i.e. C++) i. source code is sent through a module and becomes object code 3. Congress A. because source code is written down in a language, it is copyrightable B. but what if someone only copies the 1s and 0s? i. recipes are not copyrightable, so how can code be? ii. it shouldn‟t, but it is


iii. if the source code is written in a different language, it is not infringement [a]. the expression is different and infringement looks to similarity h. Right to Create Derivative Works 1. right to reproduce A. only a right to reproduce in copy i. a copy can even be created by bringing up the copyrighted subject in RAM [a]. infringement even on tiny copies ii. software companies now give out licenses instead of ownership 2. is streaming media a copy or a performance? A. temporary copies made in the buffer may implicate the need for a right to reproduce 3. are you allowed to customize/filter mass media to fit your tastes? A. i.e. Cleanflix i. wanted to filter out sex and violence in movies ii. had a customer buy the movie, and then send it to Cleanflix, and it would be sent back with the parts edited out B. CleanPlay, however, did not alter the movie physically i. had a special player with a computer code which would filter out the parts ii. thus, no copy was actually made iii. movie studios sued because they said DVD players made an unauthorized derivative work iv. Congress passes the Family Home Movie Act [a]. may sell software that blocks out sex and violence 4. right to distribute is limited by the “first sale doctrine” A. if someone sells you a copyrighted work, then you can do whatever you want with the work without violating the author‟s right of distribution i. Infringement 1. strict liability standard A. even “unconscious” copying is infringement B. infringement – unauthorized exercise of an author‟s rights under § 106 i. any unauthorized exercise of copyright rights is prima facie infringement 2. § 106 exclusive rights A. reproduce the work in copies i. the copies must have some tangibility


prepare derivative works distribute copies publicly perform (only some works) publicly display (only some works) i. publicly – any group outside friends and family ii. public viewing can be one at a time 3. must prove A. ownership of copyright is valid i. plaintiff is the author, or received the rights from the author, and the work is within the subject matter of copyright B. copying i. an unauthorized exercise of any of the copyright owner‟s exclusive rights ii. independent creation would be a complete defense 4. reproduction in copies A. right of reproduction is infringed B. can be a literal copy or “substantially similar” i. copyright holder owns the “zone” around the work C. prove i. copying, and ii. substantial similarity (or misappropriated expression) 5. defenses A. §§ 107-202 of Copyright Act are limitations on exclusive rights i. if the copyright owner shows a prime facie case of infringement, must ask if a limitation applies j. Fair Use (§ 107) 1. based on the statutory text, burden was on copyright holder to show that fair use did not apply A. however, courts now see it as an affirmative defense 2. how should the law protect certain uses? A. strict rule i. cannot make more than one copy of copyrighted work B. standard C. standard with evidentiary presumptions i. i.e. if copy less than 40% of work, presume fair use ii. drafters of the Fair Use standard decided not to create presumptions iii. chose to make it an affirmative defense requiring a case-by-case analysis [a]. this method was adopted by the USSC 3. elements of the fair use defense A. purpose and character i. commercial or non-commercial ii. transformative or „slavish” copying

B. C. D. E.


B. nature of copyrighted work i. how much of the original expression is involved C. amount and substantiality of portion used i. has the defendant taken a substantial portion? ii. if not, is it the “heart” of the work? D. effect on the potential market for or value of copyrighted work i. sale, licensing opportunities, etc. ii. consider aggregate effects if others do the same thing as defendant 4. film hypo A. client filmmaker wants to make a documentary about high/low culture i. wants to film an opera from a stage hand‟s perspective ii. stage hand was watching the Simpsons back stage iii. the opera is in the public domain, but the Simpsons is not iv. is the 7-8 seconds of Simpsons footage fair use? B. the film is not about the Simpsons and the filmmaker did not take an essential part of it C. would want to say it was probably an original work of authorship, but that even if it was per se infringement because of the copying, it could be a fair use D. nature/purpose i. filmmaker‟s purpose was to capture what the stage hand was watching ii. did not make a conscious decision to film the Simpsons (it just happened) E. effect on market i. copyright holder would claim that there was a market because they would have charged for the use ii. courts do not accept this argument [a]. to do so fair use wouldn‟t mean anything iii. the price in the licensing market does not have to be reasonable [a]. all that matters is that a licensing market exists k. Secondary Liability 1. before Grokster A. contributory infringement and vicarious liability B. Grokster introduced inducement i. is it a 3rd category or part of the previous test? 2. Sony revisited A. can Sony be held liable for infringing activity of users? i. have to look at common law because the statute only deals with direct copying ii. Court looks to patent law for guidance






B. USSC i. if there is evidence of substantial non-infringing uses, it matters for contributory infringement ii. elements of contributory infringement [a]. knowledge of infringement (actual or constructive) [b]. substantial participation in the infringement or material contribution to the infringement iii. there is no constructive knowledge if the product has substantial non-infringing uses vicarious liability A. elements i. right or ability to control the infringement ii. gain direct financial benefit from the infringing activities Napster A. setting up the system Is not direct infringement i. only acted as a “traffic cop” or “white pages” for content B. found vicariously liable i. Napster‟s right to terminate a user‟s service was enough for control ii. but Napster did not make any money iii. Court found direct benefit in terms of publicity to be sufficient Grokster A. no central server acting as a “white pages” i. had users‟ systems directly query each other ii. control and direct benefit are attenuated iii. 9th Circuit found Grokster not to be liable B. USSC i. inducement theory [a]. distribute the software to encourage infringing uses ii. elements of inducement [a]. providing the means to infringe [b]. with an intent to induce infringement C. broad reading i. copyright holders want intent to be evaluated at the design stage ii. if filters are not built in when they could have been, it is an intentional decision to induce infringement Safe Harbor provision (§ 512 of Copyright Act) A. limited liability of service providers i. not just ISPs, but any web-hosting site ii. § 512(c) – protects from liability stored at the direction of the user


B. limits of the provision i. adopt and inform users of provider‟s policy on infringement ii. have a registered agent with the copyright office iii. adopt technical measures used by copyright owners to identify and protect copyrighted works iv. Carroll – control over user and financial benefit to provider l. Open Source License 1. you can do whatever you want with the software A. but have to share it with everybody else 2. seems anarchical, but it does have a hierarchy A. i.e. for the Firefox program, there is one person who decides what updates go into Firefox m. General Public License (GPL) 1. “copyleft” 2. a license that does not require royalties, but openness A. can use and add to the licensed software, but must keep it open and distributable 3. is it a property license or a contract? A. for example, we have a license to “trespass” on school grounds i. but if the school fenced itself off after we had paid tuition, we‟d have a breach of contract claim B. if the software says it is subject to the GPL, is it a contract? i. not really – formation issues and no consideration ii. really a license and a breach makes you an infringer 4. Creative Commons A. problem with the internet and “instant” copyright i. when you get something online, you don‟t really know what you can do with it B. CC license is like the GPL, but for everything (not just software) i. “can do anything you want with it, but…” [a]. must give credit, and/or, must use for a noncommercial use, and/or cannot make derivative works, etc. ii. created a deed, in non-legalese, to explain the license iii. also made meta-data to make to machine readable C. “non-commercial” i. cannot be for a commercial advantage or private monetary compensation ii. cannot be an exchange of copyrighted works for monetary compensation


iii. Carroll – wanted more narrow language (i.e. “cannot charge for it”) n. Remedies 1. practice in the courts A. will give a preliminary injunction if likely to succeed on the merits B. will then give a permanent injunction if actually succeed on the merits 2. derivative works A. argument that derivative works should stay in the market B. the defendant should only have to pay money 3. monetary damages A. statutory damages = $750 - $30,000 B. prevailing party is entitled to attorney‟s fees C. actual damages are measured by lost profits i. or could get disgorgement of defendant‟s revenues from infringement ii. would have to show defendant‟s profits and what part is attributable to the infringement o. Feist case 1. mere compilation of facts is not copyrightable 2. creativity may be set at a low standard, but it is there 3. O‟Connor A. originality requirement comes from the Constitution i. authors are creators, and to create something it must be original B. this is odd because if the statutory language is clear, which it is, there is no need to go to the Constitution i. but Justice O‟Connor did, making it a Constitutional case p. CCNV v. Reid 1. issues A. who is an employee? B. what is within course and scope? 2. Who is an employee? A. work in question is a statue made about the homeless i. CCNV is a non-profit who arranges with Reid to build the statue ii. there is no written agreement about copyright [a]. so if CCNV is to get it, the statue must be a work made for hire iii. Reid filed a copyright certificate and CCNV filed a competing certificate B. DC Circuit found for Reid







i. Court of Appeals reversed ii. USSC took case because of split on “employee” Rules vs. Standards A. Rule i. easy to administer because of small evidence required ii. i.e. a speed limit B. Standard i. multi-factor tests which require a lot of evidence Employee tests A. potential control test (rule) B. actual control (standard) C. common law agency (standard) D. formal, salaried employee (rule) authorship A. should it be a rule or a standard? i. rule – puts parties on notice and would allow them to agree around it ii. standard – not as rigid and allows the courts to hash out circumstances with equity Common law agency A. multitude of factors for determining if an individual is an employee, such as i. how the person is paid, whether they get any benefits, etc. What is within course and scope? A. work done at home similar to work done at the office B. a multi-factor standard

q. Arnstein v. Porter 1. how to prove copying? A. direct or circumstantial evidence i. owner is very unlikely to have direct evidence ii. what kind of circumstantial evidence is useful? [a]. access (had the opportunity to copy) [b]. similarity (the greater the similarity, the greater the inference of copying) B. here, at the time Porter wrote his music, Arnstein‟s work was not public i. would undercut access ii. but Arnstein says that his manuscripts were stolen, and Porter had them iii. with circumstantial evidence, you just need the inference to be greater than, or equal to, 51% iv. the more you have on access, the less you need on similarity and visa versa 2. misappropriation


A. not just that the defendant copied, but copied too much B. standard i. an ordinary observer would think that the works were substantially similar r. Nichols v. Universal Pictures Corp. 1. work in question A. play called “The Cohens and the Kellys” i. allegedly copied “Abie‟s Irish Rose,” plaintiff‟s play ii. the plaintiff moved for summary judgment 2. the plot of a work can be actionable A. can fall on the side of expression (actionable) or idea (not actionable i. the more specific the plot similarities, the more it seems like an expression ii. but there is no brightline between idea and expression 3. in a work of fiction, the parties usually break the work down A. plot, settings, characters, etc. i. what evidence counts and what does not? ii. maybe not enough individually, but could be enough in the aggregate B. is a literary character its own copyrightable expression? i. gray area – instability because we may not know what the “work” is ii. does the “work” mean the book/TV series/etc., or an individual piece, such as a character? s. Steinberg v. Columbia Pictures Industries, Inc. 1. New Yorker poster A. downtown Manhattan is the center of the world and the rest of the world is minimized B. Steinberg drew it i. claimed movie poster “Moscow on the Hudson” copied it ii. artist essentially admitted that he copied the New Yorker poster C. substantially similar? i. break the works down into elements [a]. what is the same and what is different? ii. then ask whether an idea or an expression was copied iii. what is the scope of substantial similarity? [a]. the style of the city or something else? [b]. dangerous if we say it is the style, because then the author essentially owns the license to all derivative works


t. Computer Associates International v. Altai 1. software at issue A. directs the system‟s resources and tasks i. fundamental resource B. originally, the plaintiff‟s and defendant‟s codes were the same i. defendant changed and excised the code, and now the codes are not substantially similar 2. plaintiff‟s claim A. at a higher level of abstraction, the organizational principles of the programs are the same 3. Court A. in software cases, should use a 3-step “abstraction test” B. 1 – abstraction i. must determine what part of the code is an idea or expression ii. isolate each level of abstraction iii. merger doctrine plays a large role C. 2 – filter out the code as a result of the merger doctrine i. also filter out expression dictated by outside factors/influences (functionality doctrine) [a]. since the outside influence is not the author‟s expression and thus not copyrightable D. 3 – compare what is left 4. discs do not destroy trade secrets A. a disc does not divulge trade secrets because the disc itself does not have language humans can read i. the code is only readable by computers 5. way to get around copyright infringement like Altai did A. lock infringing code away i. put programmers who were not exposed to the code in a “clean room” [a]. because if individual programmers did not have access or exposure, it is an independent creation in terms of copyright u. Anderson v. Stallone 1. plaintiff is a lawyer who wants to be a screenwriter A. original work of authorship – a “treatment” of Rocky IV i. claims to have owned the plotline created in the treatment ii. contacts MGM and pitches them the idea B. Stallone writes a script for Rocky IV i. argument over access [a]. works are substantially similar ii. Stallone argues Anderson created an unauthorized derivative work


2. Issue A. whether Anderson‟s treatment is an original expression B. § 103 – get a copyright in a derivative work except for what was used without authorization i. in terms of Anderson, after the unauthorized material is cut out, is there anything left? C. policy i. better to only let the author make sequels or anybody? 3. Court A. no separable copyrightable expression i. so, even if someone creates a very sophisticated derivative work, if it does not have a separable expression, the original copyright holder can use it without liability ii. or, even a 3rd party could take the derivative work without liability because the work was not copyrightable v. Harper & Row v. Nation Enterprises 1. defendant is the Nation magazine A. wants to publish excerpts from Pres. Ford‟s book i. the excerpts were licensed to Time ii. the Nation got wind of them and published them early [a]. copied about 300-400 words 2. not a 1st Amendment issue A. the information would make it out to the public even if the Nation did not print it B. it is an issue of who gets to print the material 3. USSC A. look at 4 factors of fair use i. may be a public-regarding purpose, but it is done for a fee [a]. will make a lot of money printing the copyrighted material – commercial ii. autobiography is not usually copyrightable because it is facts [a]. but the more creative it is, the more it is like a copyrightable expression iii. amount looked to is the amount of the copyrightable work that was taken [a]. although the defendant‟s amount taken was quantitatively small, qualitatively, it was large [b]. qualitatively, look to the “heart” of the book – Ford‟s words on Nixon‟s pardon iv. Time cancelled its license because it was no longer exclusive [a]. this goes against the Nation because the market has decreased


4. fair use is very context specific A. USSC printed Nation‟s article in an appendix i. this is a fair use because the Court wants the public to be fully informed of the evidence w. Sony Corp. v. Universal City Studios 1. suit A. Sony‟s technology allows users/consumers to tape TV shows i. the consumers are prima facie infringers ii. but is it a fair use? 2. USSC A. focuses on factors 1 and 4 i. 1 – “time shifting” is a proper use because the users are watching the shows later [a]. it is non-commercial, but non-transformative [b]. significant that the shows were not being archived ii. 4 – no real market for “time shifting” x. American Geophysical Union v. Texaco 1. background A. original journal copying case i. no market for individual copies of Journal articles [a]. it is a fair use ii. but Journals wanted to create a market to prevent copying iii. Copyright Clearance Center – creation of photocopying licenses [a]. can buy a license to photocopy a work [b]. usually puts a limit on the number of copies iv. thus, a market is created for copies y. Sega v. Accolade 1. copyright issue A. Accolade is copying object code by disassembling Sega games i. because it could not get a license from Sega to make games for the Genesis ii. Accolade wanted to make games to compete with Sega B. the games themselves are different, but a small enabling code was copied into Accolade‟s games 2. Court A. factors 1, 2 and 3 favor Accolade B. case is remanded to determine the harm on the market i. which market? Licenses? Access to code? 3. Accolade‟s argument for intermediate copying A. copying the process, not the expression


B. if the only way to create an original expression is to copy the process, then it is a fair use 4. Prof. Carroll A. some see this case as meaning that intermediate copying = fair use i. as long as the intermediate copying is for the purpose of reverse engineering z. Kelly v. Aribasoft 1. suit over a search engine for serving up thumbnail images A. suit was not against the search engine itself, but the “images” search option B. is the scaling into thumbnail size “transformative?” 2. Court A. Aribasoft‟s purpose made it transformative i. changed the picture size to make it easier for searching ii. this was not the purpose the author intended iii. was a fair use – purpose was only for searching 3. it does not matter that the engines only benefit the copyright holder A. it is up to the copyright holder how to exploit the copyright and operate in the market aa. Campbell v. Acuff-Rose (2 Live Crew) 1. is a bass riff copyrightable? A. arguable whether a certain number of notes is copyrightable 2. Factor 1 A. commercial purpose of parody B. 2 issues – commercial? transformative? i. the parody is commercial, but transformative ii. commercial purpose does not make it presumptively unfair iii. parody vs. satire matter – need to copy is much greater in parody iv. parody here was transformative 3. Factor 4 A. parody is unlikely to be a substitute in the market B. if the copyright holder uses licenses, it strengthens the fair use argument i. not able to copy without fair use 4. USSC A. eliminates presumption against commercial uses B. Souter i. maybe not grant an injunction, but make the defendant pay damages ii. lower courts have ignored this C. strengthen protection for parody, but carve out satire


5. Chad Vader hypo A. not ask about fair use unless there is a prima facie infringement i. clothing is considered a useful article ii. is the character distinctive enough and developed enough to be copyrightable? [a]. meaning there would be prima facie infringement iii. harm to the market cannot be that Star Wars will be taken less seriously [a]. must be a harm to licensing or something similar

IV. Trademark a. generally 1. the law of marketing 2. people want to know where something is from A. quality, specific source, etc. B. branding cuts down on information costs i. consumers rely on the brand C. associate yourself with a product which then reflects to others i. status signaling 3. commodities A. when an item becomes a commodity, consumers do not care where it is from i. when this happens, price is the determinant of product choice ii. society loves commodity markets because it increases competition and lowers costs B. to get out of commodity “hell,” companies will try to differentiate their products i. in perfect product differentiation, there is no substitute for a product ii. this is done through advertising 4. trademark is concerned with a competitor cheaply riding on a company‟s brand 5. should the law step in? A. we want to protect consumers from misinformation B. but why isn‟t it just caveat emptor (buyer beware)? i. because it is wasteful to force consumers to do extensive research C. creating legal liability for the misappropriation of a mark is what trademark law does i. recently, trademark has been seen as a property asset separate from misinformation


ii. the law does have some interest in the possibility of business expansion iii. plus, we see trademarks as property because it is useful to consumers to have a signal point to only one thing [a]. policy argument about how far trademarks should go – unfair competition vs. property 6. what is a trademark? A. a word, phrase, symbol or design (or a combination thereof) which identifies and distinguishes the source of the goods or services of one party from those of others 7. source of law A. trade secrets are exclusively a product of state law, patent and copyrights are creatures of federal law, but trademarks exist at the state and federal level B. Lanham Act – federal trademark law 8. you do not need to register to get a trademark A. you have one as soon as you begin using the mark in commerce B. i.e. the Rock and Roll Hall of Fame has a trademark in the building 9. Trade Dress A. where the product configuration acts as a signal 10. trademark standard A. confusion in the minds of consumers B. but what consumers? i. even if the purchaser is not confused, other people may be confused by the knock-off (post-sale confusion) 11. key concepts A. distinctiveness i. rights of trademark come from the association in the consumer‟s mind ii. for a symbol to act as a trademark, when the consumer sees the symbol, they associate it with a particular source [a]. they do not have to know the source, but the association must be to a singular source iii. context is everything B. usually need circumstantial evidence because you usually won‟t have direct consumer evidence C. why don‟t owners always use a fanciful term? i. there is a lower marketing cost for using descriptive terms, especially for new products ii. people will not know what a new product is with a arbitrary term D. most litigation is categorizing between descriptive and suggestive 12. Secondary marks A. needed for – personal names and geographical indicators


i. a geographical indicator (i.e. Philadelphia Cream Cheese) can be misdescriptive, but it is valid as long as it is not deceptively misdescriptive 13. registration A. to get a trademark on the principle register i. the mark must be [a]. distinctive, and [b]. there must be an intent to use or actual use in the market B. registration must be maintained i. signed affidavits every 5 years stating that you are still using the mark C. Park n‟ Fly case i. a registered mark may become incontestable b. Basics of a trademark infringement claim 1. identify the mark A. trademark (on goods) B. service mark (on services) C. collective mark (tells that the good is from somebody inside the group) D. certification mark (not the source, but a third party certifying the good) i. not about the source, but quality 2. trade mark – word marks, graphic marks, or trade dress 3. what you need to show/do in an infringement claim A. show that you, as the plaintiff, own a valid mark i. it is within the subject matter of trademark and is distinctive ii. may also need to show that the mark is famous if claiming dilution B. show that the defendant is using a confusingly similar mark i.e. infringement or market confusion c. Distinctiveness 1. the mark distinguishes the source in the mind of the consumer A. some marks are automatically distinct B. others are descriptive or generic and require secondary meaning 2. types of distinctiveness A. generic i. a word used to describe the entire class of goods or services ii. e.g. calling a store “Store” iii. a generic mark can never be distinctive and the plaintiff loses


B. descriptive i. the mark describes a sub-class of goods and services ii. e.g. “Corner Store” iii. the mark must have secondary meaning [a]. the burden is on the plaintiff [b]. need evidence such as surveys, objective sales data, etc. C. suggestive i. the word suggests what the good or service is, but the consumer must make an inference to see it ii. e.g. “Aisle Say” for a movie review column iii. inherently distinctive – the plaintiff‟s burden is automatically met D. arbitrary i. use of a word out of context ii. e.g. “Apple Computers” iii. inherently distinctive – the plaintiff‟s burden is automatically met E. fanciful i. make up words ii. i.e. “Kodak” iii. inherently distinctive – the plaintiff‟s burden is automatically met d. Infringement 1. 3 points where a consumer can be confused A. pre-sale i. i.e. where a website owner is unrelated to the company B. point of sale i. e.g. StarBucks County Coffee C. post-sale i. in this instance, even though the buyer is not confused, others will see the goods and get confused ii. an example of confusion as to the source 2. infringement is governed by the Lanham Act A. parts i. I own a valid trademark [a]. arbitrary, suggestive, fanciful or descriptive with secondary meaning ii. you infringed on that mark B. for registered marks, 15 USC § 1114 (courts call it 32(a)) i. suing over the infringement of a registered mark C. § 1125(a) covers suits incorporating unregistered marks i. courts call it 43(a) 3. parties A. “senior” user – used the mark first


B. “junior” user – the second user 4. the relevant question is: are consumers likely to be confused A. who? – the average consumer B. when? – mostly at point of sale, but could be pre- or post-sale as well C. reverse confusion – when the junior is the larger party D. how do we know confusion? i. use the 10 factors from Sleekcraft E. how many consumers? i. a “substantial” amount ii. Carroll – about 20%+ is enough F. how can you simplify the multi-factor test for your client? i. decide if any of the factors, by themselves, are outcomedeterminative ii. the only such factor would be similarity of the marks [a]. if the marks are not similar, there is no confusion iii. can group the factors together if they share similar facts 5. examples A. Cecil McBee the jazz musician (plaintiff) and Cecil McBee the Japanese clothier (defendant) i. plaintiff‟s burden – they own a valid trademark which the defendant infringed ii. plaintiff would argue that his name is a trademark [a]. but, as a name it is descriptive, so it would need secondary meaning iii. in terms of the validity of the mark, we look only to the plaintiff‟s market [a]. in terms of infringement, the marks are the same [b]. strength of the mark – it is descriptive, but has some secondary meaning (probably goes to defendant) [c]. the clothier had no knowledge of the jazz musician [d]. relationship between the markets – the plaintiff would say that artists sell clothing as merchandise B. website for LSU‟s law school and a student‟s site, i. LSU‟s argument – the site would draw people and confuse them ii. a disclaimer is not a get out of jail free card (Carroll) C. trademarks are important for experience goods i. i.e. you don‟t know if you will like it until you experience it ii. Kendall wine v. Turning Leaf (Gallo)


[a]. claims – the trademark is based on the label and the trade dress is based on the bottle [b]. for the mark, the multi-colored grape leaf indicates Kendall and Gallo has infringed by using a leaf [c]. Gallo‟s first argument would be that Kendall does not have a trademark in the leaf [d]. Kendall would counter by saying that a grape leaf is suggestive of wine [e]. however, lots of different companies use the leaf, so it is not suggestive of Kendall e. Trademark Dilution 1. dilution vs. infringement A. when a mark becomes famous, it is entitled to greater protection B. dilution – tends to blur or diminish the distinctiveness of the mark i. the new user has created a second association different from the one the original user created in order to free-ride off of the fame of the mark 2. Federal Trademark Dilution Act A. blurring or tarnishment i. blurring – impaired the distinctiveness by blurring the meaning in the minds of consumers by creating a second association ii. tarnishing – harming the reputation of the mark B. the only remedy is an injunction C. marks that are covered are those famous marks which are either inherently or secondarily distinctive i. famous – widely recognized by the general consuming public ii. national fame, not niche fame D. harm – likely to cause dilution i. does not actually have to cause dilution ii. no requirement of confusion or competition E. statutory defenses i. fair use, news reporting, parody, comment, criticism and non-commercial use 3. examples A. Federal Espresso and FedEx i. argument for blurring, not tarnishment ii. would consumers develop a second association? iii. Carroll – no set way to know [a]. would need a lot of expert testimony 4. taken literally, any parody of a famous mark would be dilution


A. Courts – a parody does dilute, but it is allowable i. both by statute and the First Amendment f. Defenses 1. effect of the defense A. for genericness, functionality and abandonment, if the defense is successful, then the owner no longer has a valid trademark B. for fair use, First Amendment and parody, if the defense is successful, the second user is using a valid trademark, but is not liable for infringement 2. Genericness A. where the mark comes to mean the class of goods or services in the mind of the consumer B. genericide can happen in two ways i. patents – if you are the only producer, people will associate your name with the class of product (i.e. Xerox) ii. rapid success C. a substantial portion of the population must use the mark in its generic meaning D. way out of the trap is to create a new generic term E. Murphy Door Bed v. Interior Sleep i. the fold-out bed was designed by Murphy ii. people started calling it the “Murphy Bed” iii. the patent expires and a former licensee markets a “Murphy Bed” iv. Court – there is no infringement because the mark has become generic through public usage F. how does a patent holder avoid genericide? i. at the time the product is patented, make both a generic and product name ii. i.e. call it a “Xerox brand copier” [a]. provide the generic name with the product iii. whatever is in the minds of the consumers determines the mark G. there could be a dilution claim for trying to turn a mark generic 3. Functionality A. the strongest defense i. even if consumers are confused, there is no valid trademark B. Trafix Devices v. Marketing Displays i. trademark – double-spring design [a]. the design was the subject of a utility patent which had expired ii. argument – when the public sees the design, they think of MDI (the plaintiff)


iii. Wal-Mart case – product design can only be protected if it has secondary meaning iv. USSC – heavy presumption that a product design is functional if was the subject of a utility patent [a]. the burden is on the owner to show that it is no functional C. how do we know when something is functional i. USSC – if the thing is necessary to the use of the product or where the feature affects the product‟s cost or quality [a]. i.e. utilitarian functionality ii. gray area – how much must it affect the cost or quality? [a]. can ask whether the customer is buying the product for the feature 4. Abandonment A. the owner is no longer using the mark in commerce B. or, the owner has licensed the mark to third parties, but is not supervising the use of the mark i. licensing thus creates a duty to supervise 5. Fair Use A. whenever a descriptive mark is being used as a descriptor i. generally, using a trademark not as a mark B. Micro Colors case i. as long as a descriptive mark is being used in its descriptive sense, it is a fair use even if the plaintiff can show confusion C. easiest fair use case – comparative advertising i. using a competitor‟s mark to refer to the competitor D. Nominative Fair Use i. the Circuits are split on whether the mark needs to be used as a trademark as well as confusion for there to be infringement, or whether there is infringement simply through confusion [a]. the 2nd Circuit says the mark needs to be used as a trademark in addition to confusion ii. Nominative fair use was invented by the 9th Circuit to apply when the defendant uses the plaintiff‟s mark to describe the plaintiff‟s goods or services iii. New Kids on the Block case [a]. the newspaper was using the band‟s name in an advertisement to make money [b]. the 9th Circuit held that the newspaper has to be able to use the band‟s name to refer to the band [c]. it was a nominative use – only used the mark to refer to the band by name iv. so the issue is, can you use the plaintiff‟s mark to refer to the plaintiff?


[a]. at least in the 9th Circuit, the answer is yes (as long as it is a nominative use) [b]. i.e. only using the mark to name the plaintiff v. Carroll – under the 2nd Circuit‟s holdings, you could argue that use of a name as a reference is not a use so the defense is not even needed vi. analysis – defendant must use the mark only as a reasonably necessary to refer to the plaintiff, there was no easier alternative, and the use does not suggest sponsorship and endorsement 6. First Amendment A. trumps the Lanham Act B. limited to non-commercial speech i. commercial speech is fully protected speech and receives strict scrutiny ii. commercial speech, i.e. advertising, gets intermediate scrutiny 7. Parody A. at a basic level, parody is not confusing i. so, the First Amendment is not really significant in an infringement case ii. however, it is more important for dilution where confusing does not matter iii. to prevent constitutional issues, the dilution statute allows for comment, criticism and parody B. in parody, you have to use part of a trademark to make the parody effective i. Carroll – generally, if courts think the parody is funny, they will usually find a parody g. Remedies 1. registering a trademark grants stronger remedies A. more robust damages i. i.e. defendant‟s profits, attorney‟s fees, maybe plaintiff‟s lost profits ii. all you have to prove is the defendant‟s gross revenues from selling the infringing work/mark iii. the defendant then has to show much how much of those gross revenues were profits 2. Lindy Pen Co., Inc. v. Bic Pen Corp. A. Bic is sued by Lindy over the mark “Auditor” used on pens i. Lindy used the mark “Auditor” ii. Bic came out with a line of pens called “Auditor‟s fine points” B. Court i. Bic‟s sale of the pens in stores did not create confusion


ii. however, confusion could be caused by telephone sales because individuals could not see and differentiate the pens C. Bic had to pay profits from the telephone sales of the pen i. but, Lindy did not present Bic‟s isolated telephone sales [a]. it did not isolate the revenue sales of the infringing product [b]. thus, damages could not be calculated 3. Big O v. Goodyear A. case of reverse confusion i. Big O, the smaller company, is the senior user of “Bigfoot” ii. Goodyear, the junior user, adopts the mark B. remedy i. Big O wants enough money to launch a corrective ad campaign ii. the court agrees as to the validity of this remedy, but does not agree on the amount C. Carroll – corrective advertising is an unusual, trademark specific remedy i. it is not granted frequently ii. the concern is that the plaintiff would not use the money for the corrective purpose g. Qualitex Co. v. Jacobson Products Co., Inc. 1. plaintiff‟s complaint A. Qualitex (plaintiff) made dryer-pads of a certain color B. Jacobson then made pads of the same color i. Qualitex trademarked the color and then sued ii. Jacobson argued that trademark does not include color 2. Jacobson‟s reasoning A. the court will have to get specific about shades of color i. the court does not accept this because it already does so with words or phrases B. there are only a limited number of colors i. Court – if the color, as a signal, has a function, then it cannot allow a trademark because it would be a back-door patent 3. when do you have a trademark? A. when the symbol becomes “distinctive” i. it signifies the source B. the color here as a signal i. primary meaning – a color ii. secondary meaning – a Qualitex pad 4. USSC A. color is not necessarily barred from being a trademark i. it can meet the trademark requirements


ii. if it does, then there is no special rule that prevents color from being a trademark 5. one can lose their trademark if consumers begin associating a signal with something generic A. the trademark must function as a trademark in the minds of the consumer 6. Harley-Davidson case A. filed for a trademark for the sound of the motorcycle i. need to ask, under Qualitex, if the sound has a function? ii. i.e., is the sound needed for the bike to function? iii. even if it is not functional, HD would still need to show that the sound is distinctive h. Zatarain‟s v. Oak Grove (Chick-Fry case) 1. defendant‟s argument A. Zatarain‟s does not own a trademark because it is descriptive 2. plaintiff‟s response A. there is a trademark because the products have secondary meaning B. the marks are “Chick-Fry” and “Fish-Fry” 3. Step 1: classify the mark A. generic, descriptive, suggestive, etc.? B. for a suggestive mark, the plaintiff has the burden of proof i. must show that the consumer takes the additional step of association C. or, the plaintiff must prove secondary meaning if it is descriptive D. can conduct consumer surveys to find out what is in the minds of consumers 4. judicial tests A. dictionary definition B. “imagination test” C. a competitor‟s potential need for the term D. a competitor‟s actual use of the term 5. fair-use defense A. it is judge-made B. at a minimum, it applies to descriptive marks C. if a competitor is using a descriptive mark, in its descriptive sense, the competitor may use it in its descriptive sense even if the term has acquired secondary meaning i. i.e. the competitor cannot use the mark as a brand i. Two Pesos, Inc. v. Taco Cabana, Inc. 1. Taco Cabana sues Two Pesos A. Cabana says it owns a trademark in the décor of its Mexican restaurant






i. the bright colors, motifs, etc. B. but, any Mexican restaurant will work off of consumer expectations i. so, Cabana argues that the trade dress as a whole is associated with Cabana legal issue A. Pesos says that Cabana does not have a trademark because trade dress needs secondary meaning i. the Second Circuit required this because there are only so many ways to decorate USSC A. trade dress does not need secondary meaning i. trade dress will be treated the same as trademark ii. if a trademark is inherently distinctive, it does not need secondary meaning [a]. the same will be true of trade dress how can we determine if a trade dress is inherently distinctive? A. conceptually – can think of arbitrary decors for restaurants B. Carroll – question whether the facts make Cabana‟s trade dress inherently distinctive i. have to ask – “by itself, is this element associational in the minds of consumers?” ii. this aids in fleshing out exactly what trademark is owned functionality A. only non-functional, distinctive trade dress is protectable i. even if there is a trademark association, if it is functional, the plaintiff loses ii. want to protect against back-door patents

j. Wal-Mart v. Samara 1. fashion designers need the ability to use and recycle old styles 2. functionality problem A. copyright does not protect clothing because it is a useful article i. its cut or shape is not copyrightable B. a design patent takes too long C. so, we want trademarks i. looking at the clothing can tell you who makes it 3. the issue here is not copying, but knock-off style 4. precedent (Two Pesos) A. normal rules apply to non-functional trade dress 5. Scalia A. precedent really only applies to product packaging i. three kinds of trade dress [a]. product packaging [b]. product configuration


[c]. tertium quid – something between packaging and design (i.e. the glass Coke bottle) ii. the second and third require secondary meaning B. reasoning – need functionality and secondary meaning to separate patents from trademarks C. narrowing of precedent i. Two Pesos does not say that trade dress cannot be inherently distinctive, but it also does not say that product design can be inherently distinctive k. Zazu Designs v. L‟Oreal S.A. 1. trademark priority A. usually, the first one to use a trademark gets it i. issue is with determining use 2. common law trademark is state law A. it triggers as soon as the mark is used in commerce B. some states have registration i. however, with the internet, it makes more sense to get a federal trademark 3. Zazu (salon) registered a trade name, not a mark A. trade name = name of the company B. it is possible, but not necessary for a trade name to be the trademark 4. who used the mark first? A. in the marketplace, the Zazu came first i. not registered, but used in hair salon services ii. who came first in hair care products? 5. issue A. L‟Oreal was a big company who invested a lot of money into a mark that was not registered and Zazu was a small company i. Zazu intended, but did not actually use, the mark when contacted by L‟Oreal B. do we want a rule where a small company can block competitors simply through intent? i. or a rule that rewards getting to market first? ii. the judge in this case was Easterbrook iii. a former law and economics professor who was geared towards economic efficiency 6. rule for trademark A. if it is not registered and there is no plan to register it, all the law requires is that it be “used in commerce” 7. Zazu‟s argument A. it was the first to use the mark in hair care services, and hair products are closely related i. Easterbrook‟s answer – use must be more than sending out a few bottles


[a]. need more than a mere intent to sell ii. it might be enough for the salon to sell it in the shop and be set up to take orders [a]. but this would probably only get you a local trademark because only local customers will see the mark as a source symbolizer [b]. whereas federal registration gives you national priority 8. good and bad faith A. dissent – only concerned with L‟Oreal‟s actions i. it paid one company $125,000 for a covenant not to sue ii. feels L‟Oreal dealt with Zazu in bad faith iii. does not feel that bad faith should give priority [a]. believes in commercial morality B. Easterbrook i. but a rule that only requires token use is dangerous ii. it allows for a company to come in, grab the mark, and ransom it out 9. switch to an “intent to use” standard A. intent registration solves the notice concern B. but the ransom concern is still present C. statute i. the registrant has 6 months to come to the mark, or they lose their registration ii. given 6 months because it is expensive to get ready and go into a market l. 1-800 Contacts v. 1. this case is only binding in the Second Circuit 2. argument A. after the plaintiff proves that it has a distinctive mark, it must prove that the defendant is using the mark as a trademark i. only then do you ask if there would be customer confusion 3. use doctrine is not tied to “use in commerce” or “use in goods or services” A. you can really use a trademark, but you cannot use it as a brand 4. here, a pop-up appears when a trademark is used 5. Google has sponsored links A. a company can pay Google to always be the first hit B. can also pay to show up as a side ad in response to search terms C. American Blinds sues Google because the term “American Blinds” is being used as the trigger to sponsored links D. if the doctrine is correct, then Google wins i. because Google is not using the mark as a brand or trademark


m. AMF Incorporated v. Sleekcraft Boats 1. is the defendant trading on the plaintiff‟s goodwill to the extent it will confuse consumers? 2. facts A. plaintiff Slickcraft and defendant Sleekcraft both made boats B. the plaintiff claims confusion because of the close names, the overlapping market, etc. i. disagree that they are in the same market because of the targeted use of the boats ii. Sleekcraft‟s defense – it did not know about Slickcraft and it changed its mark as soon as it did find out iii. while knowledge does not matter (because infringement is strict liability), good/bad faith is a factor 3. infringement A. standards which are context sensitive, rather than rules B. are the goods or services related in the minds of consumers? i. if not, then use of the same mark will not confuse and there is no infringement 4. factors (type of evidence needed) A. similarity i. sight, sound and meaning B. strength i. inherent vs. acquired distinctiveness C. price of goods and other factors indicating customer care i. the more expensive the product, then, presumably, more care will be taken in researching the product ii. the more research that is done, the less likelihood there is for confusion D. length of time the defendant used the mark i. the longer the use, the better it is for the defendant because consumers have had time to learn and distinguish the products E. intent of the defendant in adopting the mark i. if the defendant knew of the plaintiff‟s mark, it is likely that the defendant intentionally rode on the plaintiff‟s goodwill ii. i.e. the defendant adopted the mark with an intent to confuse [a]. the plaintiff will call this bad faith F. evidence of actual confusion i. evidence is not always good for the trademark owner [a]. amount of consumers confused matters ii. evidence – misdirected letters, complaints, emails, etc. to the company iii. quantitatively, how many need to be confused?


[a]. not a majority, but it cannot just be 2-3% either [b]. issue is over how many before competition becomes unfair [c]. courts say “substantial” confusion (some say about 15%) G. whether the goods are marketed through the same channels of trade i. relevant because, if they are, consumers will see both in the marketplace [a]. increasing the chance of confusion ii. even if older consumers know the difference, new consumers can be confused H. extent to which the targets of the parties are the same I. relationship of the goods in terms of similarity and function J. other facts suggesting the consuming public might expect the original owner to be in or expand into the defendant‟s market i. gives the trademark owner a ring of protection into similar markets [a]. the stronger the mark, the bigger the zone 5. Wine example A. the defendant‟s first argument on trade dress will be that no mark really exists i. classification based on taste is an idea which is not infringement ii. it is just a style, and the plaintiff cannot own a style B. the plaintiff would argue that the different usage is more than descriptive n. Pepperidge Farm (CatDog case) 1. as a matter of law, you can bring a dilution claim in a competing goods case A. plus, the chance of blurring increases with competing goods i. like with the Goldfish and CatDog crackers ii. not so much with a cracker and a restaurant sign B. evidence – how similar are the uses and the marks? i. what is the context in which the consumer comes into contact with the marks? 2. the mark must be distinctive A. strength of distinctiveness matters with dilution B. probably need a heightened level of distinctiveness 3. not trying to prove confusion with dilution A. trying to prove multiple associations with one mark p. Mattel v. MCA Records 1. Barbie as a trademark A. owned by Mattel (who aggressively sues over their trademarks)




4. 5.




B. represents, at the most basic level, a doll the band Aqua makes a song titled “Barbie Girl” A. describes and makes Barbie a character i. “Barbie” does not just describe a doll infringement claim A. consumer confusion i. the consumers who buy Barbie [a]. not just parents, but children as well ii. the song is using the Barbie mark in a confusing way B. is it being used as a mark? i. Carroll – use in a title is not a trademark use ii. song titles are not trademarks C. dilution claim i. the song creates a second association with “Barbie” current dilution statute A. defense for a non-commercial use Judge Kozinski A. ruling was based on the old dilution statute B. non-commercial = anything not commercial speech i. commercial speech – proposes a commercial transaction Fred & Ginger case A. if using a title as an expressive use, it does not infringe a trademark i. expressive use – using the mark to express an idea Mutual of Omaha case A. if a defendant is going to use plaintiff‟s mark and call it a parody i. the mark must be used as a parody ii. a defendant cannot use plaintiff‟s mark to make a different point Michelob case A. a defendant cannot use a corporation‟s mark to make a parody of corporations in general


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