Category: Intellectual Property
Clear ResultsIntellectual Property
AI Back in Court: MiniMax Studio’s “In your Pocket” Faces Hollywood Studios Copyright Infringement Claims
When an AI company markets its product as a "Hollywood studio in your pocket," it probably shouldn't be surprised when Hollywood lawyers come knocking. Such is the lot of MiniMax, a Shanghai-based tech company whose video and image generation platform, Hailuo AI, became the target of a joint copyright lawsuit filed by Disney, Universal, and Warner Bros. Discovery in a California federal court last fall. The studios' complaint alleges that Hailuo AI was built on a foundation of stolen intellectual property: that MiniMax scraped and trained its model on the studios' copyrighted films without permission, and that the resulting platform can generate eerily accurate, downloadable images and videos of characters like Darth Vader, Wonder Woman, and the Minions, all with MiniMax's own branding slapped on them, at the push of a button. The lawsuit raises two distinct types of copyright infringement claims. The first involves the AI's training: the argument that feeding a model copyrighted films without a license is itself an unauthorized reproduction of those works, regardless of what the model later produces. The second involves the AI's outputs: the finished videos and images that directly replicate protected characters. The studios also pursued a theory of contributory infringement, arguing that MiniMax didn't just passively enable infringement, but actively encouraged it. The company's own promotional materials featured generated clips of the studios' characters, and it sponsored tutorial videos walking users through how to produce content like "Spider-Man and Supergirl kissing in the park." On May 22, 2026, a federal judge denied MiniMax's motion to dismiss, rejecting both the company's claim that a U.S. court lacked authority over a Chinese defendant and its argument that the studios hadn't stated a viable legal claim. On the contributory infringement theory in particular, the court found the studios' allegations sufficient to proceed. The studios have framed the stakes in stark terms, warning that as generative AI advances, it's only a matter of time before these tools can produce full-length unauthorized films. While that outcome remains speculative, the core legal question the case will force courts to answer is concrete: can an AI company build a commercial product on copyrighted works it never licensed, and then profit from an output that reproduces those works on demand? If the studios prevail, the answer will reshape how AI developers approach content licensing and what rights holders can expect in return. For now, MiniMax's motion to dismiss has been denied, the parties are headed toward discovery, and the "Hollywood studio in your pocket" is facing the real Hollywood in court.
June 22, 2026
Intellectual Property
Trademark Office Actions Explained: Why They Feel Random Yet Aren't
For many in-house legal teams, the most frustrating part of the trademark registration process is the Office Action. A trademark application is filed after discussions with marketing, business leaders, and outside counsel. Clearance (hopefully) were conducted. Filing strategies were approved. Then, after months of silence, a letter arrives from the U.S. Patent and Trademark Office raising objections that can feel technical, unexpected, or disconnected from how the brand actually operates in the marketplace. The reaction is often the same: Why is this happening? Why now? Didn't we already do the work to avoid this? From the applicant's perspective, Office Actions can appear arbitrary. Yet from the USPTO's perspective, trademark examination is one of the most structured parts of the registration process. What feels random to applicants is usually the result of a defined review process applied to imperfect information. Understanding that process can help in-house counsel manage expectations, communicate more effectively with business stakeholders, and make better strategic decisions when issues arise. Why Office Actions Feel Arbitrary Part of the frustration stems from timing. Trademark applications often sit for several months before they are assigned to an examining attorney. During that period, the business has usually moved on. Marketing campaigns may already be underway. Product launches may be approaching. Internal teams assume that no news is good news. Then the Office Action arrives. Because of the delay, the refusal often feels disconnected from the decisions that led to the filing. The individuals who selected the mark may no longer remember the details of the clearance process. New stakeholders may question why the issue was not identified earlier. Budget assumptions may have been based on the expectation of a straightforward registration. The substance of the refusal can compound the confusion. A likelihood of confusion refusal may compare two marks that, from a commercial perspective, seem entirely different. A descriptiveness refusal may target a name that the marketing department considers highly creative. Technical objections regarding identifications of goods and services may appear to focus on wording rather than the underlying business reality. To business teams, these objections can seem detached from common sense. In reality, they reflect the fact that trademark examination occurs within a specific legal framework that prioritizes the contents of the application record over marketplace nuance. How Examining Attorneys Actually Review Applications Trademark examiners do not begin with the applicant's business strategy. They do not evaluate whether the mark was expensive to develop or whether substantial resources have already been invested in a launch. Trademark examiners review applications using a structured analytical process. The examining attorney assesses the mark as filed. They review the identified goods and services. They compare the application against existing registrations and pending applications. They evaluate whether the mark is merely descriptive, generic, deceptively misdescriptive, or otherwise barred from registration under the Trademark Act. They also confirm that the application satisfies various procedural and technical requirements. The examination is therefore limited by the record before the USPTO. Examining attorneys generally do not investigate how the applicant actually uses the mark beyond what is reflected in the application and supporting materials. They do not independently explore the applicant's target consumers, brand architecture, or commercial objectives. They do not assess whether business stakeholders believe confusion is unlikely in practice. Their role is narrower. They apply statutory standards and USPTO guidance to the application as presented. They live in the “Trademark Manual of Examining Procedure.” For in-house counsel, this distinction is important because it highlights how early filing decisions can significantly influence later outcomes. Choices regarding the wording of identifications, the breadth of claimed goods and services, the quality of specimens, and the evidence included in the record can all shape the examination process months later. The Most Common Triggers for Office Actions Although Office Actions often feel unpredictable, most fall into a relatively small number of recurring categories. Likelihood of confusion refusals under Section 2(d) remain among the most common. These refusals frequently arise because the trademark register is increasingly crowded. Even marks that appear distinguishable from a branding perspective may encounter issues when similar marks cover overlapping goods or services. Broad identifications can exacerbate this problem. When an application claims expansive categories of goods or services, the examining attorney must assume that the applicant intends to operate throughout the full scope of those descriptions. This can create conflicts that might not exist if the identification more accurately reflected the applicant's actual business activities. Descriptiveness refusals under Section 2(e)(1) also occur regularly. Marketing teams often gravitate toward names that immediately communicate product attributes or benefits. From a branding perspective, these choices can be compelling because they convey information efficiently. From a trademark perspective, however, they may raise concerns regarding whether the proposed mark merely describes the identified goods or services. Specimen refusals represent another common category. These frequently stem from timing pressures associated with filing. Businesses eager to secure rights may submit materials that do not clearly demonstrate trademark use, or that fail to associate the mark with the relevant goods or services in the manner required by the USPTO. In many cases, these Office Actions do not reflect unusual circumstances or examiner idiosyncrasies. Rather, they are predictable outcomes resulting from how the application was prepared and supported. How to Respond Without Overreacting Receiving an Office Action should not automatically trigger an alarm. Some Office Actions are largely procedural. Amendments to identifications of goods and services, disclaimer requirements, and requests for clarification can often be resolved efficiently without materially affecting the scope of protection sought. Others require more substantive analysis. A likelihood of confusion refusal may warrant consideration of arguments distinguishing the marks, amendments narrowing the identification, coexistence discussions with third parties, or reassessment of the filing strategy. Descriptiveness refusals may prompt evaluation of acquired distinctiveness claims, supplemental registration options, or broader branding considerations. The critical task for in-house counsel is distinguishing between issues that genuinely threaten the viability of the brand and those that simply require thoughtful adjustment. Treating every Office Action as a crisis can create unnecessary friction with business stakeholders and increase legal costs. Conversely, minimizing significant refusals may expose the organization to avoidable risk. A measured approach grounded in an understanding of the examination process allows legal teams to calibrate their responses appropriately. What This Means for In-House Oversight Office Actions should not be viewed solely as obstacles or evidence that something has gone wrong. In many respects, they function as feedback mechanisms. They identify areas where the application record can be improved, where filing assumptions may warrant reconsideration, or where the realities of the trademark landscape impose limitations that were not fully appreciated at the outset. For in-house counsel, this perspective shift can be valuable. Understanding how examining attorneys evaluate applications enables legal teams to set more realistic expectations with marketing and executive leadership. It encourages more deliberate decision-making during the application stage. It also facilitates more productive conversations with outside counsel regarding risk tolerance, filing strategies, and response options. Perhaps most importantly, it reduces the perception that the USPTO operates unpredictably. Trademark examination is not random. It is systematic. But it is a system that relies heavily on the quality and precision of the information provided to it. When businesses recognize that dynamic, Office Actions become easier to understand and manage. They cease to be viewed as unexpected disruptions and instead become part of a broader process aimed at defining the scope of protectable rights. That understanding does not eliminate frustration. Delays will still occur. Disagreements with examining attorneys will remain inevitable. Difficult strategic decisions will still arise. But it does replace uncertainty with context. And for in-house teams responsible for guiding brands through increasingly complex trademark portfolios, that context can make all the difference.
June 15, 2026
Intellectual Property
Prelaunch Trademark Risk: What In‑House Counsel Should Address Before Product Launch
Most trademark problems do not begin with a refusal from the USPTO or a cease-and-desist letter from a competitor. They begin much earlier during product development and brand naming, often before legal is meaningfully involved. For in-house counsel, pre-launch trademark risk is less about technical doctrine and more about process. Decisions made under time constraints, reliance on incomplete clearance signals, selection of legally weak brands, and launching without a filing strategy all narrow options later and increase the cost of correction. The companies that encounter the most difficult trademark issues are rarely careless. They move quickly, assume issues can be addressed later and underestimate how much momentum limits flexibility once a product is public. This article outlines the most common pre-launch trademark mistakes and explains how in-house counsel can reduce risk without slowing down the business. Trademark Risk Begins Before Legal Engagement Most trademark issues do not originate with the USPTO. They originate months earlier, often before an application is filed and before legal is formally engaged. From an in-house perspective, this distinction matters. When disputes, launch delays, or rebrands arise, the underlying issue is rarely legal uncertainty. More often, it is the result of early decisions made quickly and without a clear understanding of how difficult it will be to unwind later. Product launches compress timelines and concentrate risk. Naming decisions intersect with marketing, product design, domain strategy, packaging, investor communications, and customer-facing materials. Once those elements begin to align around a particular name, even modest legal concerns can feel disruptive rather than protective. By the time a trademark issue surfaces, legal’s role often shifts from risk management to damage control. The objective of pre-launch trademark oversight is not to prevent launches. It is to ensure that risk is identified early enough that the business still has meaningful choices. Naming Is a Business Decision with Legal Consequences Brand naming is often treated as a creative exercise. Teams generate options under tight timelines. Internal alignment forms quickly around a preferred name. That name begins appearing in materials across the organization. By the time legal is consulted, the decision may feel effectively final. The risk is not creativity. It is commitment before clearance. From an in-house standpoint, the most effective intervention is not controlling the naming process but setting expectations. No name is final until trademark risk has been evaluated. That evaluation does not always need to be exhaustive. In many cases, a high-level assessment is sufficient to identify obvious conflicts or structural weaknesses. When legal review is positioned as a standard step rather than an exception, teams are less likely to treat it as an obstacle. Over time, this reframes trademark review as part of launch planning, not a last-minute hurdle. Superficial Clearance Signals Create False Confidence Teams often rely on informal indicators to assess trademark risk, especially under time limitations: a domain is available, a state entity search is clean, a quick internet search shows no obvious conflicts. These signals can create a strong sense of comfort. The problem is that trademark risk does not turn on identical names or identical industries. It turns on the likelihood of confusion, a fact-specific analysis that considers the relationship between goods or services, channels of trade, and overall commercial impression. Those considerations rarely surface through informal searches. From a general counsel perspective, the issue is not that teams perform preliminary checks. It is when those checks are treated as conclusions rather than inputs. When “nothing obvious came up” becomes “this is safe,” the business begins investing in a name based on assumptions that may not hold. Early legal review recalibrates that assumption. It identifies where uncertainty exists and provides context for evaluating risk before additional resources are committed. Clearance Does Not Equal Strength Even when a name clears existing rights, it may still be a poor trademark. Descriptive or highly suggestive names are often attractive because they communicate product features quickly. From a legal standpoint, however, these marks tend to offer limited exclusivity and are more difficult to enforce. This distinction is often overlooked. Many weak marks can be registered. Registration alone does not ensure meaningful protection. In-house counsel plays an important role in distinguishing between registrability and strength. A mark that technically clears may still leave the company exposed to competitors operating nearby in the market. Over time, that exposure can lead to inconsistent enforcement and frustration when legal remedies do not align with business expectations. Framing trademarks as strategic assets rather than filing exercises helps align naming decisions with long-term differentiation. Launching Without a Filing Strategy Narrows Options Speed to market is a legitimate business priority. So is trademark priority. Companies often launch products without deciding which marks warrant protection, how consistently the brand will be used, or how it may expand across products, services or jurisdictions. In some cases, filing decisions are deferred simply because they have not been considered. Once public use begins, options narrow. Changes become more visible and course correction becomes more difficult. Strategy becomes reactive rather than intentional. From an in-house perspective, early planning does not need to be complex. Even a limited pre-launch discussion can clarify key questions: Which names are central to the business, and which are experimental? Is the mark likely to expand beyond a single product? Are international markets realistically in scope? Addressing these questions early preserves flexibility for enforcement, expansion and future transactions. “We’ll Fix It Later” Is Rarely a Strategy A common assumption is that trademark issues can be addressed after launch. Sometimes they can. Often, they cannot. Rebrands are expensive. Enforcement leverage weakens over time. International expansion frequently exposes conflicts that were not apparent at launch. What initially appears to be a manageable legal issue can become a broader commercial problem. By the time the issue is clear, the available options are typically narrower and more costly. Legal solutions may feel misaligned with business momentum. In-house counsel does not need to control naming decisions. They do need to normalize early involvement, set expectations around clearance, and ensure that trademark decisions align with long-term business objectives. Trademark Risk Is a Process Issue Most preventable trademark risks arise before legal engagement. It stems from timing, assumptions, and informal decision-making, not from misunderstanding the law. For general counsel, the opportunity lies in process. Clear expectations around when legal is consulted, how preliminary clearance is interpreted, and when filing strategy is addressed can significantly reduce risk without slowing the business. When trademark considerations are integrated into launch planning early, legal’s role shifts from reacting to problems to shaping outcomes. That shift preserves flexibility, reduces surprises, and allows trademark protection to support business growth. The objective is not perfection. It is awareness, alignment, and control at the point when decisions are still flexible.
May 14, 2026
Trademark and Copyright
“Alright, Alright, Alright,” — Taylor’s Version. Taylor Swift follows Matthew McConnaughey’s Novel Approach to Using Trademark Rights to Enforce Against AI Impersonation
Ever eager to retain control over her masters and ensure that she “never goes out of style,” Taylor Swift is the latest public figure looking toward registration of sensory trademarks to protect her name and likeness in a roundabout way. On April 24, 2026, Taylor Swift's company, TAS Rights Management, filed three trademark applications with the U.S. Patent and Trademark Office: two "sound marks" capturing her spoken voice (which include the language "Hey, it's Taylor" and "Hey, it's Taylor Swift") and one design mark consisting of a photograph of Swift performing onstage during The Eras Tour. This echoes our prior writing regarding similar applications filed by the actor, Matthew McConnaughey, as Swift’s applications represent the latest in a growing movement of public figures attempting to use trademark rights to protect their names and likenesses — most likely due to the increasing accessibility of AI technology, which can impersonate such figures. While sound marks have historically been used to protect iconic brand audio cues, like Netflix's "tu-dum", the MGM lion roar, or NBC's chimes, these public figures have attempted to apply the same framework for their spoken voices and image. This genuinely novel use of trademark law is as-of-yet untested, and Swift's motivation here is not hard to read, as her likeness has been used without permission in numerous AI-generated fakes, including by Meta's AI chatbots, in non-consensual pornographic images, and in false political endorsements shared during the 2024 presidential election. The legal theory underlying these filings is novel and creative precisely because existing law was never designed for this purpose. Under current U.S. law, a musician's recorded performances are protected by copyright law, while the unauthorized commercial exploitation of a person's name or likeness is addressed by state-level right-of-publicity statutes. Individual states, including New York and California, have right-of-publicity laws that prevent unauthorized commercial use of a person's name, image, and likeness (“NIL”), but trademark infringement claims can be filed in federal court, making them a potentially more powerful deterrent as those cases apply nationwide and are not dependent on individual states’ differing enforceability limitations. Most importantly, trademark enforcement doesn't just stop identical uses as copyright enforcement does. Rather, trademark enforcement is designed to protect a rights owner against anything "confusingly similar" to a registered mark. This is a meaningfully broader standard that could reach AI-generated content that approximates, but doesn't exactly replicate Swift's voice or appearance. Trademark claims also enhance the ability to obtain emergency injunctive relief and to recover damages against AI platforms themselves. However, these applications face an unsure road to registration. Trademark protection traditionally requires that the mark function as a source identifier (i.e., signaling to consumers the origin of a product or service) and it is far from settled whether a person's voice or image satisfies this standard. Historically, trademarks are not designed to protect an individual's general likeness, voice, or persona. Swift's filings may be best understood as a deliberate effort to layer additional federal remedies on top of existing right-of-publicity and copyright protections rather than a “cure-all” to the elusive offense of AI impersonation, the scale and sophistication of which is not subject to a single body of law. Whether these applications ultimately succeed, they reflect a broader and accelerating trend: public figures and their counsel actively searching for any available legal structure to fill the enforcement gap that generative AI has created. It is clear that Swift believes that she will continue to Party Like It's 1989™. image credit SockaGPhoto - stock.adobe.com
May 11, 2026
Trademark and Copyright
AI Copyright Litigation Continues as NVIDIA Training Data Case Moves Forward
A ruling earlier this month by Judge Jon S. Tigar in Nazemian et al. v. NVIDIA Corp., No. 4:24 cv 01454 JST (N.D. Cal. filed Mar. 8, 2024), declining to dismiss key claims in the case following NVIDIA’s motion to throw out portions of the complaint, signals that courts continue to be reluctant to resolve copyright disputes concerning AI training and outputs at the pleading stage. The ongoing class action against NVIDIA demonstrates why disputes over AI training data sourcing will continue to shape copyright doctrine well beyond the first wave of generative AI cases. In Nazemian a class of authors, including Abdi Nazemian, Brian Keene, Stewart O’Nan, Susan Orlean, and Andre Dubus III, allege that Nvidia violated the Copyright Act by copying and storing unauthorized digital copies of their books to train its NeMo Megatron large language models, asserting claims for direct infringement, contributory and vicarious infringement, statutory damages, and injunctive relief. They also make claims under the Digital Millennium Copyright Act, alleging removal of copyright management information. Central to the case are the plaintiffs’ allegations that NVIDIA’s training datasets incorporated pirated works sourced from “shadow libraries,” including Books3 (derived from Bibliotik), The Pile, SlimPajama, and Anna’s Archive, each of which allegedly contain massive numbers of unauthorized copies of copyrighted books. Unlike earlier AI disputes that focused on whether model outputs were substantially similar to copyrighted works, the Nazemian action frames infringement as complete at the point of copying of the inputs into the model when works were allegedly downloaded and retained, regardless of whether subsequent model training is transformative. In allowing the direct infringement and related claims to proceed, the court made clear that fair use presents a mixed question of law and fact not suited for resolution on a Rule 12(b)(6) motion, particularly where the provenance, scope, and scale of the copied materials remain disputed. The ruling ensured that NVIDIA would not obtain an early exit from the litigation and underscored that allegations of unlawful data acquisition alone can carry a complaint past the pleading stage. The Nazemian litigation sits within an expanding ecosystem of AI copyright cases, which at present comprises more than 50 such actions pending in U.S. federal courts, including actions involving Meta Platforms, Anthropic, and OpenAI. While recent fair‑use rulings have not stemmed the AI litigation tide, the legal discussion has shifted from abstract debates about innovation policy to examinations of data sourcing, internal decision‑making, and statutory compliance. Even as courts acknowledge that AI training may satisfy the “transformative use” inquiry, they continue to treat market harm, licensing markets, and unlawful acquisition as fact‑dependent questions. It appears that so long as AI developers rely on massive training data sets and courts remain skeptical of practices involving pirated or unlicensed sources, copyright litigation over AI training models will continue to pervade.
May 4, 2026
Intellectual Property
Knowing Isn’t Enough: The Supreme Court Redefines ISP Liability for Piracy
When users pirate music, movies, or other creative works online, the internet service provider (“ISP”) supplying their connection may know more than you might think. Companies like Cox Communications receive thousands of automated notices identifying exactly which subscriber accounts are associated with illegal downloading — in Cox’s case, such notices accrued over a period of two years. In Cox Communications v. Sony Music Entertainment, decided March 25, 2026, the Supreme Court confronted a deceptively simple question: if an ISP knows a subscriber is using its service to steal copyrighted content and keeps providing that service anyway, is the ISP itself liable? A jury of the lower court said “yes,” issuing relief to the tune of roughly $1 billion. The Supreme Court has now unanimously reversed the jury’s decision, although the Justices aren’t in agreement with respect to their rationale and extent. Writing for the majority, Justice Thomas held that an ISP can only be liable for contributing to its users' infringement if it intended that the provided service be used for infringement, particularly in two narrow circumstances: 1) if the ISP actively encouraged the illegal activity, or 2) if the service itself was essentially designed for piracy. The Court found that Cox never promoted piracy and, in fact, issued warnings to and suspended infringing accounts. The majority made clear that simply knowing about infringement and failing to cut off service to every potential infringing account (and, indeed, the record suggests that Cox did not know with total particularity which accounts engaged in infringement) is not enough. Justice Sotomayor, concurring, agreed Cox was not liable but warned that the majority had gone too far in strictly defining only two theories of “intent.” She argued that the ruling diminishes the DMCA safe harbor, which was specifically designed to give ISPs an incentive to crack down on repeat infringers in exchange for legal protection. If ISPs can't be held liable regardless of the very strictly defined theories of intent, that no longer has material effect. Justice Jackson joined Justice Sotomayor in her concurrence. For technology providers, implementing procedures to warn against infringement, and even taking action such as suspending service, may successfully ward off secondary liability. For copyright holders, particularly in the music, film, and entertainment industries, this decision has the potential to present a significant setback for IP enforcement, as avenues for pressuring ISPs to police their networks have been substantially narrowed. Going forward, rights holders may need to focus enforcement efforts more directly on individual infringers or on platforms that actively facilitate piracy, rather than on the companies providing the underlying internet connections. While the decision is a major win for ISPs, the Sotomayor concurrence reasoning could signal that future litigation (or future legislation) may set new standards.
April 27, 2026
Intellectual Property
Spring Cleaning Your Trademark Portfolio: A Plain-English Guide for In-House Teams
Most companies accumulate trademark assets gradually and unevenly. New products are launched, old brands linger, and registrations are filed opportunistically rather than strategically. Over time, the portfolio reflects history more than the current business. For in-house counsel, this creates a familiar challenge. The company technically owns trademark rights, but it is often unclear which marks still matter, which are vulnerable, and which quietly create risk. A portfolio that appears “complete” on paper can hide gaps, inconsistencies, and inefficiencies that surface at the worst possible moment: during enforcement, diligence, licensing, or an international expansion. Spring provides a useful opportunity to take stock. The goal is not to rebuild the portfolio from scratch; it is to bring it back into alignment with how the business actually operates. This kind of annual review helps ensure that legal protection supports the company’s current operations and future plans rather than merely documenting past decisions. Do Your Core Marks Still Reflect Actual Use Trademark rights are tied to use, not intention. Branding evolves. Logos are refreshed, taglines change, and product names drift. Registrations often lag behind these shifts. The risk is not that branding has evolved. The risk is relying on registrations that no longer reflect what customers actually see in the market. When a registration does not match current usage, enforcement becomes more difficult, and internal teams may assume protection exists where it is uncertain. A basic review should confirm that the most important marks are being used in substantially the same form as registered. It should also check that the listed goods or services accurately describe the current business. Marks that are materially altered, extended beyond their registered scope, or used in ways not captured by the registration require attention. This step turns trademark oversight into a practical, operational exercise rather than a purely administrative task. Which Marks Are Still Worth Keeping Many portfolios contain registrations for discontinued products, legacy brands, or marks that were filed defensively and then forgotten. Every registration carries cost and maintenance obligations. Beyond the expense, unused or marginal marks can complicate enforcement strategy and raise questions during due diligence or audits. Spring cleaning is an opportunity to categorize the portfolio. Identify which marks are core to current business operations, which are legacy or historical, and which can be allowed to lapse without meaningful risk. This process helps focus resources where they matter most and avoids creating confusion for internal teams or third parties. Marks that are no longer strategically relevant can be retired deliberately, reducing administrative burden and clarifying enforcement priorities. Where Are the Coverage Gaps Business growth almost inevitably creates gaps. New products are launched under existing brands, services expand beyond their original scope, and companies enter new jurisdictions without confirming local protection. Gaps often remain invisible until a triggering event, such as a competitor conflict, a transaction, or an international rollout brings them to light. For in-house counsel, the goal is not to eliminate every potential gap. It is to understand where gaps exist, evaluate their significance, and determine whether they matter given near-term business plans. Some gaps may be acceptable if they pose minimal risk in the short term, while others require immediate action to preserve enforceable rights. Early awareness allows counsel to advise the business proactively rather than reacting to surprises later. Is Internal Usage Undermining Your Rights Even strong registrations lose value when internal usage is inconsistent. Teams may shorten, alter, or combine marks with other terms. Brand names are sometimes used as nouns or verbs. Third parties within the company or among partners may be permitted to use marks without clear guidance. None of this creates immediate failure. Over time, however, inconsistent or uncontrolled use can weaken distinctiveness and enforcement posture. Marks lose their legal strength if they are not used deliberately and consistently. A portfolio review should include a high-level assessment of whether the company is applying its most important marks intentionally, across products, marketing materials, packaging, digital channels, and communications. Ensuring consistent internal usage is often as important as confirming the technical legal status of the registration. Would the Portfolio Make Sense to a Third Party A useful thought experiment is to imagine a buyer, lender, or auditor reviewing the portfolio for the first time. Would the portfolio tell a coherent story about the business or raise questions that require explanation? Would the marks, filings, and strategic choices make sense in the context of current operations and future plans? Spring cleaning is less about perfection and more about narrative. A portfolio that clearly reflects current operations and priorities is easier to defend, easier to budget, and easier to explain in high-stakes settings. It signals to third parties that the company manages its brand assets deliberately, maintains consistent internal practices, and aligns legal protection with business strategy. For in-house counsel, this type of review does not require specialized trademark expertise. It requires judgment, prioritization, and coordination with business teams. Done annually, it reduces surprise risk, strengthens enforcement leverage, and makes downstream trademark decisions easier. It also provides a documented rationale for why certain marks are maintained, altered, or allowed to lapse, which can be invaluable during diligence, licensing, or strategic planning. Turning Review into Action The value of a portfolio review lies in translating findings into actionable steps. Examples of typical follow-up actions include: Confirming continued use and alignment of core marks with registrations Retiring or abandoning legacy marks that no longer support the business Flagging gaps that could affect new products, services, or international expansion Providing clear internal guidelines for consistent usage and escalation Prioritizing filings for marks that require additional protection or international coverage This does not need to be complicated. Even a lightweight process ensures that legal and business teams share the same understanding of which marks are critical, which are optional, and which require attention in the coming year. A Strategic Perspective for General Counsel Most general counsel do not need to manage every registration or conduct searches themselves. They do need to understand where risk accumulates quietly and intervene before it becomes material. Annual portfolio reviews place trademark oversight in a strategic context rather than a reactive one. They provide clarity on enforcement priorities, highlight potential risks, and align the portfolio with the company’s current business objectives. A clean, well-aligned portfolio preserves flexibility. It makes enforcement more straightforward, supports licensing and expansion, and provides confidence in transactions or audits. By establishing a structured, annual review process, general counsel will ensure that trademark assets function as living business tools rather than static records of past filings. The Objective of Spring Cleaning The objective is not perfection; it is awareness, alignment, and control. It is ensuring that the portfolio accurately reflects the business, highlights strategic priorities, and allows legal protection to support, not hinder operations and growth. When conducted annually, spring cleaning transforms the trademark portfolio from a collection of filings into a coherent, actionable asset that contributes to the company’s long-term value.
April 13, 2026
Intellectual Property
The Lion King Chant Roars Into Federal Court
Most people know the opening chant of Disney's "The Lion King," even if they can't quite place the words. That chant, "Nants'ingonyama bagithi Baba," was composed and originally performed in 1994 by Grammy-winning South African artist Lebohang Morake, known professionally as Lebo M. Its meaning, as published in the 2019 soundtrack liner notes, is a royal Xhosa proclamation: "All hail the king, we all bow in the presence of the king." On March 16, 2026, Lebo M filed a federal lawsuit in the Central District of California against Zimbabwean-born comedian Learnmore Jonasi, who told millions of podcast and social media viewers that the chant actually translates to "Look, there's a lion. Oh my god." The complaint, seeking over $20 million in damages, raises an unusual and provocative question: when does a comedian's viral joke cross the line into actionable harm to an artist's livelihood and legacy? The lawsuit brings four distinct claims. The first invokes Section 43(a) of the Lanham Act, arguing that Jonasi's false "translation" amounts to a misleading description of Lebo M's commercially significant creative work. The remaining three claims concern state law: 1) defamation per se, alleging the joke implies that a celebrated, award-winning composition is meaningless gibberish; 2) trade libel, targeting the disparagement of the composition itself as a commercial product; and 3) tortious interference with prospective economic advantage, based on Lebo M's concern that the viral mockery could jeopardize his decades-long working relationship with Disney. Notably, the complaint does not include a copyright infringement claim, as Jonasi never reproduced the composition itself. Therefore, the theory of harm here is reputational and commercial, not about unauthorized copying of protected works. Ultimately, the case will hinge on the tension between intellectual property protections and the First Amendment. Jonasi's legal team is likely to argue that a humorous riff on a song lyric's meaning is protected speech, comprising an opinion or parody, not a provably false "statement of fact" as defamation law requires. But the complaint lays groundwork to counter that defense: it alleges that Jonasi presented his translation in an informational podcast setting (as opposed to, for example, a stand-up special where such humor is expected as a matter of course), that Lebo M personally contacted Jonasi with the correct translation, and that Jonasi explicitly refused to retract. If the court finds those facts credible, the case for actual malice (and potentially significant damages) becomes much more compelling. For creators, brand owners, and anyone whose professional reputation is tied to a specific body of work, Morake v. Mwanyenyeka is a case worth watching as it develops.
April 6, 2026
Intellectual Property
USPTO Issues Final Rule Requiring U.S.-Registered Patent Practitioner Representation for Foreign Applicants and Patent Owners
The United States Patent and Trademark Office (USPTO) has issued a Final Rule, published March 20, 2026, requiring all foreign-domiciled patent applicants, inventors, and patent owners to be represented by a U.S.-registered patent attorney (a lawyer who has passed the patent bar exam) or patent agent (a non-lawyer who has passed the patent bar exam) for all submissions made to the Office. U.S.-domiciled applicants, inventors, and patent owners may still proceed pro se. Beginning July 20, 2026, the USPTO will enforce a major procedural change that affects any patent application listing even one inventor, applicant, or owner whose domicile is outside the United States. If any named party is foreign-domiciled — even if others are U.S.-based — the entire application will now require representation by a U.S.-registered patent attorney or patent agent. Foreign law firms and companies with global R&D teams, cross-border collaborations, foreign subsidiaries, international research fellows, or joint development partners must ensure that a registered U.S. practitioner is engaged from the start. Many organizations will be surprised to learn that “foreign” is defined not by citizenship, but by where an inventor or entity legally resides or operates their principal place of business. A single foreign-domiciled contributor on a project can trigger the new representation requirement. The rule is designed to curb fraud, increase filing accuracy, and harmonize U.S. practice with nearly all major foreign patent offices — and it represents one of the most significant shifts in U.S. patent procedure in a decade. It parallels (but is distinct from) the USPTO’s 2019 trademark rule requiring U.S. counsel for foreign trademark applicants, reflecting a broader USPTO effort to reduce fraudulent pro se filings and strengthen enforcement. Key Features of the Final Rule Mandatory U.S.-Registered Practitioner Representation Foreign-domiciled applicants and owners, defined by domicile rather than citizenship, must be represented by a registered practitioner in good standing before the USPTO. Domicile includes a natural person’s permanent legal residence and a juristic entity’s principal place of business. The requirement applies broadly to new applications as well as to amendments, Information Disclosure Statement (IDS) submissions, Application Data Sheet (ADS) filings, petitions, priority and benefit claims, and micro-entity certifications. Only registered practitioners who have passed the USPTO examination may represent others in patent matters. Filing Date vs. Substantive Requirements A foreign-domiciled inventor may still obtain a filing date without practitioner representation, but key components of the application, such as priority claims, ADS information, micro-entity filings, and other required papers, will not be accepted until a U.S. practitioner is appointed. This creates an important procedural distinction between patent and trademark practice. Enforcement Mechanisms The USPTO will enforce the rule through several mechanisms. Unsigned or improperly signed filings will not be entered into the record, and the Office may issue Notices of Non-Compliant Representation requiring the applicant to appoint a practitioner within a specified period. Fraud mitigation is a central driver of the rule, as requiring registered practitioners allows the USPTO to pursue misconduct even if an application is later abandoned. Efficiency and Resource Allocation The rule also reflects a focus on efficiency and resource allocation. By reducing the number of procedurally defective filings submitted by foreign pro se applicants, the USPTO aims to decrease the examiner time spent correcting errors and to lessen the burden on the Office of Patent Application Processing. Why the USPTO Implemented This Rule The USPTO has identified several reasons for implementing this change. First, the rule promotes global harmonization, as most major intellectual property offices, including those in Europe, Japan, China, and Korea, already require foreign applicants to be represented by locally authorized practitioners. Second, it addresses a growing trend of fraud and misrepresentation, including false micro-entity certifications, inaccurate inventor or owner listings, and filings submitted through unregulated intermediaries overseas. Because registered practitioners are subject to ethical rules, reporting obligations, and disciplinary oversight, the USPTO gains enforcement leverage that is not available when dealing with foreign pro se filers. Third, the rule is intended to improve accuracy and efficiency, as pro se filings often require correction, clarification, or substantial examiner intervention, and representation at the outset improves application quality and reduces delays. Comparison With the 2019 USPTO Trademark Counsel Rule The USPTO’s 2026 patent rule closely mirrors the 2019 trademark counsel requirement in purpose, as both are designed to reduce fraudulent filings, improve compliance with U.S. legal and procedural standards, ensure accuracy in submissions, and eliminate foreign pro se participation. However, the rules diverge in key ways. The trademark rule requires representation by a U.S.-licensed attorney (though, as a practical matter, it remains advisable to engage counsel with meaningful trademark experience), while the patent rule imposes a more specialized requirement of a USPTO-registered patent attorney or agent. They also differ procedurally: trademark applications generally will not be accepted without proper counsel, whereas patent applications may still receive a filing date but will be considered incomplete until compliant representation is secured. The scope of who qualifies as “foreign” is broader in the patent context, applying if any applicant, inventor, or owner is foreign-domiciled, compared to trademarks, which focus on the domicile of the owner alone. Finally, while both rules address fraud, the patent rule more directly targets specific abuses, such as false micro-entity claims, improper priority assertions, and fraudulent correspondence filings, reflecting a documented rise in these issues in foreign-originating applications. Practical Implications for Foreign Applicants and Patent Owners Foreign-domiciled individuals and entities should take proactive steps to ensure compliance. They should retain a U.S.-registered patent practitioner as early as possible, particularly if they plan to file U.S. patent applications in or after July 2026. They should also review existing portfolios for upcoming deadlines that will require practitioner signatures, ensure that ADS filings, micro-entity certifications, petitions, and follow-on submissions are properly executed by a registered practitioner, and anticipate USPTO notices requiring representation in applications that were filed before the rule’s effective date.
April 6, 2026
Intellectual Property
Britney Spears' Music Catalog Sale Highlights Rise in IP Deals Across the Music Industry
Britney Spears is the latest cultural icon to monetize her intellectual property by selling the rights to her entire music catalog to publisher Primary Wave for an estimated $200 million. This landmark agreement encompasses over two decades of hits and underscores a surging industry trend in which creators convert the long-term value of their IP portfolios into immediate capital. Spears joins a growing list of major artists (including Bruce Springsteen, Bob Dylan, Justin Bieber, and Katy Perry) who have recently brokered massive nine-figure transfers of their publishing and recorded music rights. For artists evaluating their intellectual property strategy, liquidating a catalog offers compelling advantages. The chief and obvious benefit is the immediate, guaranteed lump-sum payout an artist receives, which protects the artist from the uncertainties of fluctuating streaming revenues and shifting market trends. Additionally, a sale relieves the artist and their heirs from the complex, ongoing administrative burdens of managing copyright rights, negotiating licensing deals, and auditing royalties. The firms that acquire these rights assume the responsibility of actively pitching the catalog for lucrative placements in film, television, and commercial branding, by using their resources to maximize the IP's reach. However, cashing out requires artists to make significant trade-offs, the most notable drawback being the forfeiture of long-term royalty streams. If the music's value spikes due to a viral trend or a high-profile placement, the publishing firm reaps the financial windfall, not the creator. Furthermore, artists often surrender the ultimate right to control how their work is commercialized, opening the door for their music to be licensed for campaigns or media they might otherwise have rejected. In today’s highly charged political climate, this trade-off is not insignificant. This monumental sales strategy highlights the immense, tangible value of a well-protected IP portfolio, illustrating the careful balance creators must strike between immediate financial certainty and the long-term stewardship of their brand.
March 2, 2026
Intellectual Property
Beckham v Beckham: The Legal Anatomy of a Very Public Breakdown
If HBO’s writer’s room is looking for its next prestige drama, then they should look no further than the Brooklyn family feud. Brooklyn Beckham, the first son of David and Victoria Beckham, took to his Instagram story to unleash a set of accusations against his family, including allegations of interference with his marriage to Nicola Peltz and “Brand Beckham” priorities. These statements intensified an already rumored family rift dating back to wedding-related disputes. But the most commercially significant feature of this story is not interpersonal conflict; it is that the conflict is playing out inside a high-value brand ecosystem, creating a multijurisdictional intellectual property battle. Once such allegations are made to millions of followers, the situation stops being purely private: it becomes an enterprise risk event that is capable of triggering contractual defaults, insurance notifications, and formal legal positioning, even if nobody wants to ever walk into a courtroom. Viewed through a legal lens, the dispute quickly breaks into several distinct areas of exposure. Defamation Risk (and why wording matters) When accusations are aired on social media, lawyers immediately ask: fact or opinion? Statements framed as verifiable facts that harm reputation can trigger defamation claims, especially when a reputation is also a revenue stream. When endorsements and licensing deals are involved, reputational harm can quickly morph into business tort exposure. “Rights to My Name”: Trademarks as Leverage Brooklyn’s reported complaint that he was pressured to sign away rights to his name pulls the dispute squarely into trademark law. Public reporting suggests the Beckhams registered their children’s names as trademarks while they were minors, with renewals now looming. That matters because whoever controls the mark controls licensing, commercial use, and has negotiation leverage in a family fallout. Contracts, Endorsements, and Morals Clauses Public drama makes brand partners nervous. Endorsement and licensing agreements often include morality clauses, non-disparagement language, and notice requirements. Once a controversy breaks, counterparties will quietly check whether they have termination rights, or at least a reason to renegotiate. Non-Disparagement and Confidentiality in Family Businesses Family empires often run through layers of companies and agreements. If any family members are contractually bound by confidentiality or non-disparagement provisions, public statements can create legal headaches. Enforcement is tricky, though. Injunctions risk free-speech pushback or loss of goodwill, damages are hard to quantify, and over-lawyering can amplify the story instead of burying it. Cease-and-Desist Letters: The First Legal Chess Move Some outlets report that lawyers got involved. From a litigator’s perspective, early correspondence matters: non-privileged pre-litigation letters can become evidence, admissions can haunt later filings, and privilege only protects communications handled carefully. A cease-and-desist letter is more about positioning than the endgame. Media Control, Privacy, and Narrative Wars Complaints about “media manipulation” raise different legal questions depending on jurisdiction. In the UK, privacy and misuse-of-private-information claims loom larger; in the US, privacy torts vary wildly by state. Fame doesn’t erase rights, but it does complicate them. Brand Custodianship and Fiduciary-Adjacent Issues When parents hold intellectual property rights for children, especially through guardian or trust structures, disputes can trigger questions that sound a lot like fiduciary duties: who controlled the asset, who benefited, and whether transitions to adulthood were properly documented. Who’s Authorized to Speak? PR teams, agents, managers, and family members often operate under overlapping authority. When statements fly, lawyers look at who approved what, whether anyone exceeded their mandate, and whether internal PR or confidentiality protocols were breached. In conclusion, Brooklyn’s private grievances should trigger public company-level risk management. The Beckham name is a business after all, and Brooklyn’s public breakdown is risky for the business. Beckham v Beckham is a battle for control. For anyone operating inside a family enterprise or personal brand, the warning is clear: adequate governance, contracts, and IP planning prepare your brand for when that Instagram statement goes live.
February 13, 2026
Trademark and Copyright
Trademarks 101 for In-House Counsel: What Actually Deserves Your Attention Each Year
Most general counsel did not build their careers expecting to spend meaningful time on trademarks. They are rarely the reason a deal closes, a lawsuit settles or a quarter hits its numbers. And yet for many companies, trademarks become one of the most valuable corporate assets while receiving the least structured legal oversight. That disconnect exists because trademark risk behaves differently than other legal risks general counsel manages. Patent disputes, employment claims and regulatory investigations tend to announce themselves clearly and demand immediate attention. Trademark problems usually do not. They accumulate quietly through missed deadlines, casual brand changes, uneven enforcement decisions or international expansion that outpaces legal review. When those issues surface, they often do so at the worst possible moment: during a product launch, an acquisition, a licensing discussion or a dispute that limits available options. This article is an orientation for in-house counsel who do not live in this area every day. The focus is practical: what deserves attention on an annual basis, why those items matter and how to think about trademarks as part of a broader legal risk management function rather than a collection of filings handled in the background. Trademarks Are Living Business Assets One of the most persistent misconceptions about trademarks is that they function like deeds. Once registered, the thinking goes, they sit safely on the shelf until renewed every decade. In reality, trademarks behave more like contracts. Their value depends on ongoing use, consistent presentation and deliberate enforcement choices. A trademark registration is not a certificate of ownership in the abstract. It is a legal recognition that a company is using a specific mark in a specific way for specific goods or services. If the business changes and the registration does not, the legal protection begins to drift away. From an in-house perspective, the right question is rarely “Do we have trademarks?” The better question is “Do our trademarks still reflect how the business actually operates today?” That framing turns trademark oversight into an operational exercise rather than a clerical one. It also explains why annual review matters even when nothing appears to be wrong. The Four Trademark Functions That Matter Each Year Trademark law contains many technical rules, but in-house oversight usually comes down to four recurring functions. These functions are interconnected, and weakness in one area tends to surface later as a problem in another. Portfolio Alignment with the Business Every year, the business evolves in ways that affect brand usage. New product lines are introduced. Services expand beyond their original scope. Marketing refreshes logos, taglines or visual presentation. Legacy brands are retired, modified or absorbed into broader platforms. These changes often occur without legal involvement because they are seen as commercial rather than legal. From a trademark perspective, misalignment creates risk. Registrations protect what is actually used in commerce, not what the company once used or intended to use. Annual portfolio alignment should confirm a few core points: Core brands are still being used in a manner consistent with their registrations New offerings are covered by existing registrations or flagged for new filings Marketing changes have not materially altered the mark without legal review This process does not require deep trademark expertise. It requires awareness of how the business is changing and a mechanism for connecting those changes to legal protection. Without that connection, companies often discover gaps only when enforcement becomes necessary or when diligence exposes inconsistencies between registrations and real-world usage. Maintenance and Renewal Filings Trademark rights can be lost without any adversarial action. In the United States, trademark owners must file specific declarations and renewals at defined intervals, including the year prior to the sixth year after registration, the year prior to the tenth year after registration and every ten years thereafter. Failure to file on time will result in cancellation, even if the mark is actively used. For in-house counsel, the risk here is rarely about understanding statutory deadlines. It is about process discipline and accountability. Annual review should confirm: Deadlines are centrally tracked rather than residing with individual teams Examples of trademark use reflect how the brand is actually presented to customers Someone confirms continued use before legal declarations are signed These filings are often treated as routine administrative tasks. The consequences of error, however, can ripple across the organization. Loss of a registration weakens enforcement leverage, complicates licensing discussions and may require refiling from a position of reduced priority. Monitoring and Policing Trademark rights can vanish if other parties begin using similar brands. That said, these rights do not disappear the moment a third party adopts a similar name. Accordingly, inconsistent enforcement weakens rights over time and creates credibility problems when enforcement becomes unavoidable. Annual oversight should include a high-level assessment of how monitoring and enforcement decisions are made. This is less about volume and more about consistency. Key considerations include: Whether new competitors or products create meaningful risk of confusion Whether internal teams understand when to escalate brand concerns Whether enforcement decisions align with broader business objectives For most companies, the goal is not aggressive enforcement. It is a predictable enforcement that can be explained later to courts, counterparties or acquirers. This predictability helps in at least two ways. First, selective silence often becomes a problem during litigation or diligence when opposing counsel asks why certain uses were tolerated while others triggered action. Second, it is easier to budget your legal spend if you understand what actions you would take in certain situations. Strategic Coverage Gaps Growth frequently outpaces trademark planning. Companies enter new markets, expand internationally or acquire brands with incomplete legal protection. Often, teams assume existing rights will carry forward without evaluating whether that assumption holds. An annual review creates space to identify and prioritize coverage gaps before they become urgent. Useful questions include: Are we operating in new jurisdictions without trademark protection Did we acquire brands that were never properly registered or maintained Are international operations relying on U.S. rights without local analysis These issues are easiest to address proactively. Once a conflict arises or a launch is imminent, the range of available solutions narrows quickly and costs increase accordingly. Why This Belongs on the General Counsel’s Annual Checklist Trademark issues rarely reach the boardroom unless something has already gone wrong. When they do surface, they tend to implicate multiple parts of the organization at once: marketing, sales, licensing, international operations and corporate development. An annual trademark review allows general counsel to move from reactive problem solving to managed risk. It helps to: Reduce surprise issues that disrupt business initiatives Allocate legal budget between maintenance and strategic growth Create internal discipline around brand usage and escalation Preserve flexibility for future transactions, licensing and expansion Viewed this way, trademarks are less about logos and more about optionality. Clean, well-aligned portfolios are easier to enforce, easier to license and easier to value in a transaction. Trademarks as a General Counsel-Level Oversight Function General counsel are not expected to master every specialty area. They are expected to recognize where quiet risks accumulate and intervene before they become material. Trademarks fit squarely into that category. They rarely require daily involvement. They benefit significantly from periodic review by someone who understands the business and can connect legal rights to operational reality. Outside counsel can handle filings, searches and enforcement mechanics. In-house counsel provides strategic oversight to ensure those efforts remain aligned with how the company actually operates. A structured annual check-in, whether internal or with trusted outside counsel, is often sufficient to keep trademark risk proportional, predictable and manageable. The objective is not perfection. It is awareness and control.
February 6, 2026
Intellectual Property
Trademarks 101: What Business Advisors Need to Understand When Guiding Clients
As a business advisor, your role often involves helping clients make strategic decisions that affect their growth and risk profile. One area that frequently intersects with broader advisory issues is trademark law. While business advisors do not typically manage trademark filings or enforcement, understanding the fundamentals helps you identify when trademark considerations should be part of the conversation with your clients and when to involve legal professionals. Why Trademarks Matter in Advisory Contexts Trademarks are critical to brand identity and business value. They influence marketing strategies, product launches, and even transaction structures. For example, if a client is investing heavily in a new brand or entering new markets, trademark clearance and protection should be addressed early. Similarly, during mergers or acquisitions, trademark ownership and registration status can significantly affect valuation and deal terms. Recognizing Existing Rights and Risks Clients often assume they need to “get a trademark” or have formal registration to have trademark rights, but rights can arise through the use of a trademark in commerce – simply by selling products or rendering services under a trademark. Business advisors should be aware of this so they can flag potential issues — such as whether a client may already have rights in a brand name or whether a brand might risk infringing on someone else’s trademark. These are signals to recommend a legal review. Advantages of Trademark Registration Even though your clients have trademark rights from using a trademark, federal registration conveys many benefits, including nationwide rights, presumptive ownership, and easier enforcement on platforms like Amazon or TikTok Shop. It also enables recording with U.S. Customs to block counterfeit imports. Advisors should understand these benefits so they can guide clients to consider trademark registration when investing in brand development, expanding geographically, or entering online marketplaces. Trademark Risks in Broader Business Decisions Trademark conflicts can derail product launches or lead to costly litigation. When advising on branding, domain acquisitions, or marketing campaigns, advisors should ensure that trademark clearance is part of the planning process, typically by recommending a qualified trademark attorney. In M&A transactions, confirming trademark status and chain of custody is a key part of due diligence. Monitoring and Enforcement Trademark owners can lose or weaken their rights if they do not take steps to prevent third parties from infringing (whether willful or innocent) and from cybersquatting. Valuable brands should be monitored for these activities. But advisors should be aware that enforcement strategies can affect brand reputation. While cease-and-desist letters are common, tone matters; overly aggressive enforcement can lead to public backlash or legal counterclaims. This is another area where legal counsel should take the lead, but advisors can help clients weigh business risks and reputational considerations. Key Takeaways for Advisors For advisors, the most important takeaway is that trademarks should be viewed as a strategic asset, not just a legal technicality. Your clients are well-served if you can recognize when trademark issues intersect with business decisions and guide your clients toward qualified trademark counsel when warranted. By doing so, you can help clients protect their brands, avoid costly disputes, and strengthen the long-term value of their businesses.
January 26, 2026
Trademark and Copyright
Actor Matthew McConaughey Registers Sensory Trademark “Alright, Alright, Alright” in Enforcement Effort Against AI Deepfakes
Well-known actor Matthew McConaughey has attracted headlines following the registration of a number of trademarks, not just related to brands with which he may be associated, but also those that address his pop-culture persona. Most interesting among these is McConaughey’s recent registration of the phrase "Alright, alright, alright," first uttered by the actor in the 1993 film Dazed and Confused, which has become strongly associated with the actor’s laid-back, Texas public image. McConaughey, however, has not only registered “Alright, Alright, Alright” as a trademark, but also as less common sensory marks. Sensory marks are trademarks that identify brands through senses other than just text or static logos. Well-known examples include the three-note (G-E-C) NBC Chimes, the MGM lion’s roar accompanying many well-known films, and the specific scent of Play-Doh. According to McConaughey’s legal team, the registration of these sensory marks and other recent registrations represents an attempt to enforce against the ever-increasing problem of AI-generated “deep fake” videos, in which celebrities or other well-known individuals are impersonated, in strikingly authentic fashion. The registration of “Alright, Alright, Alright,” (Reg. Nos. 7995951 and 8070191) as sensory marks, specifically, has the potential to represent a tactical shift in celebrity rights management. By securing federal trademark protection for the specific sound and motion of his delivery of the phrase, McConaughey attempts to move beyond the patchwork of state-level "right of publicity" laws. A federal trademark registration provides nationwide constructive notice of McConaughey’s ownership and creates a legal presumption that his distinct mannerisms and delivery of the phrase serve as source identifiers for the registered Class 09 goods and Class 41 entertainment services, which constitute his on-screen performance. In the context of AI, this allows his legal team to pursue infringement claims under the Lanham Act against entities using AI voice clones or deepfakes to endorse products. Unlike a right of publicity claim, which often requires proving the appropriation of one's "likeness," a trademark claim focuses on consumer confusion; specifically, whether an AI’s use of the catchphrase falsely suggests McConaughey’s sponsorship or approval. However, relying on trademark law to police AI has significant limitations. The primary hurdle is the "commercial use" requirement; trademark laws are designed to prevent consumer confusion in the marketplace, not to protect personal dignity. Consequently, this registration may be ineffective against non-commercial AI generations, such as artistic deepfakes, memes, or satire, which may be protected by the First Amendment or the doctrine of Fair Use. Ultimately, the scope of protection offered by these new registrations may be narrow. While McConaughey can now vigorously enforce against an AI creation saying “alright, alright, alright," this specific registration offers little recourse against an AI model mimicking his voice to say anything else. Infringers could potentially bypass this protection by simply creating AI content that avoids his registered catchphrases while still exploiting his vocal timbre and mannerisms. While this registration adds one weapon to his arsenal, it is likely a specific deterrent rather than a comprehensive shield against unauthorized digital exploitation.
January 26, 2026
Intellectual Property
Common Copyright Mistakes That Can Cost Your Business Big
You learned everything you need to know about avoiding copyright infringement in elementary school: don’t copy. And if you do copy, you will be called a copycat. Childish, I know, but it seemed to work. Except copying continues outside of elementary school, and businesses spend time and money resolving claims of unauthorized copying, diverting their attention and resources from their core business. The Problem Although we may learn in elementary school not to copy, the lesson does not always take hold. What harm is there in copying? Who is going to catch us? If it’s online, it’s available for me to use, and I don’t need anyone’s permission. That thinking is one root of the problem. The notion that obtaining permission is too much of a legal slog (too expensive, too time consuming, etc.) is another reason the ‘don’t copy’ rule is ignored (generally seen in tech projects, such as the current use of others’ works to train large language models for AI). More often than not, copiers get caught. This is especially true in the case of parties copying photographs. Photographers are well aware that their photographs are used without permission, and actively police their rights. There have been lawsuits regarding the use of photos of foods used on menus without permission. Creators have received cease and desist letters because they have used, without permission, a photograph as the background for a work they created. Photographers have sued when their images were re-posted on Instagram without permission. Interior design and fashion companies (among others) like to post on their websites and their social media when their items or their work are featured in prominent publications. Such postings are almost always without permission. For example, a wallcovering company could post on its website photos from magazines showing its wallcoverings in houses. The owners of the homes may have consented to the company’s use of the photos, and the magazines may have consented, but that is usually not enough. The photographer must give permission because they generally own the copyright to the photo. Posting photos to social media can also result in claims of copyright infringement if the posts are made without permission. Yes, social media is made for sharing photos. That does not mean that photos can be shared without consent. LeBron James, Gigi Hadid, Versace, Fenty, and Moschino have all been sued for copyright infringement after posting photographs on social media without permission (Gigi Hadid was sued for posting photos of herself taken by paparazzi). News articles, too, present an issue. Reproducing news articles can give rise to copyright infringement claims. Imagine if a company had a news section on its website that reproduced news articles it thought would be of interest to its customers. That would also pose issues. Each article posted would be an infringement. If that posting was a long-running practice (say two or three years), then that company could be in for a significant payment to the owner(s) of the posted articles. If You Copy, Then You Copied Unauthorized reproduction of artistic works is generally known as copyright infringement. The primary defense to copyright infringement is that the original work and the infringing work are not substantially similar, or that one did not have access to the original work. But in the cases we have been discussing, that argument is generally not available, as the copies are usually identical to the original work. Giving credit to the creator of the original work does not avoid a claim of copyright infringement. A photographer or a news organization might decide not to take action if credit is given, but the fact that you gave credit is not a legal defense. In copyright infringement cases, it doesn’t matter that you didn’t intend to infringe. You either infringed or you didn’t. Intent enters the picture, in some situations, when damages are being assessed. Fair use is frequently cited as a defense. While fair use is a defense to a copyright infringement claim, determining whether something constitutes a fair use usually requires determination by a court. Such a determination can take considerable time (a year or more), and it is difficult to predict how a court will decide a fair use question. The fact that the entire work is reproduced will weigh against a finding of fair use, as will the fact that the work has not been transformed into something new — the work has merely been reproduced. If the photograph or news organization has a program for licensing their works, that will also weigh against a finding of fair use. The limited number of defenses works in favor of copyright owners. Copyright Law Favors Copyright Owners If there has been copyright infringement, copyright owners are entitled to recover their actual damages plus the infringers’ profits attributable to the infringement. If the copyright owner timely registered their copyright, they can seek, as an alternative to actual damages, statutory damages, which are generally set by the court and can be up to $30,000 per infringement and up to $150,000 per willful infringement. With timely registration, copyright owners can also seek to recover their reasonable attorney’s fees. That alone is favorable to copyright owners, but recent Supreme Court decisions have decidedly tipped the scales. In one case, the Supreme Court ruled that the Copyright Act’s three-year statute of limitations only applied to when a claim had to be brought, not how far back the copyright owner could reach for damages. In another case the Supreme Court declined to rule on whether the three-year period is calculated from when the copyright owner discovers the infringement or from when the infringement occurs. Most courts calculate it from when the copyright owner discovers the infringement. So take the wallcovering company we discussed above. They have been posting magazine covers and the pages from the magazines featuring their wallcoverings on their website for ten years. One of the photographers used by the magazines to photograph houses learns what the wallcovering company has been doing today. The photographer has three years from the date of discovery to act, and when they do, they can recover damages for every post by the company that infringed the photographer’s rights, even if the post was made ten years ago. That can add up very quickly, and result in payments to copyright owners in the thousands or millions of dollars. What To Do? The penalties for copyright infringement can be steep, making it essential to learn how to avoid copyright infringement exceedingly important. Training employees to ask questions about what they are doing before they do it is a good way to start. Provide users links to images of interest, and do not duplicate them unless you have permission. Linking is not copyright infringement. Ensuring that employees understand the company’s policy against copying and discouraging it is another step. Train employees on what is permissible and what is not. Do not assume that they know — there are many myths and urban legends about what is permissible, and the time to learn what the law actually permits and what it does not permit is before a claim is brought, not after. Hiring your own creators to create photos, images, articles, and the like for your company’s use, is another way to avoid this issue. Yes, there is a cost associated with this. That cost, however, is likely less than the cost of paying to resolve a claim brought by a copyright owner, both in time and in money (and your own attorney’s fees).
November 18, 2025
Commercial Litigation
D.C. District Judge Narrows Case Between E-Commerce Giants, Temu and Shein
In December 2023, Temu (operated by Whaleco Inc.), a general e-commerce platform specializing in drop-shipping resale goods sold at deep discounts, filed suit against Shein, a similarly structured fast-fashion clothing manufacturer. In their suit, Temu alleged that Shein perpetuates a "mafia-style" scheme to monopolize the fast-fashion market through supplier intimidation, trade secret theft, and abuse of the Digital Millennium Copyright Act. Temu claimed that Shein coerced Chinese suppliers, who provide the overwhelming majority of Temu’s inventory, into filing over 33,000 allegedly baseless copyright takedown notices on Temu’s website in order to disrupt Temu's operations. Shein countersued in August 2024, accusing Temu of encouraging sellers to infringe intellectual property rights, stealing Shein's trade secrets and product designs, and operating a counterfeiting-reliant business model. This battle between Shein and Temu reached a critical moment on September 30, 2025 when a district judge in the District of Columbia dismissed key claims of plaintiff Temu, while allowing Temu’s intellectual property claims to proceed. This recent ruling proved a strategic victory for Shein. The court dismissed Temu's antitrust claims under the Sherman and Clayton Acts, ruling that the alleged anticompetitive conduct occurred in China and fell outside U.S. jurisdiction. The court dismissed Temu's trade secret claims for similar reasons, as the alleged theft of trade secrets occurred overseas. However, the court left Temu's intellectual property claims intact, finding that Temu adequately pleaded infringement of its trade dress by Shein, direct copyright infringement related to Temu’s promotional mobile phone games, and violations of DMCA Section 512(f) for knowingly issuing false copyright takedown notices. This case underscores critical challenges for companies operating in global e-commerce markets – especially as international drop shipping business models become increasingly ubiquitous. In particular, U.S. courts have faced increasing difficulty addressing allegedly anticompetitive conduct by overseas entities whose actions may still be felt in the U.S. Meanwhile, such actors continue to misuse DMCA takedown procedure to gain a competitive edge in the market rather than as an IP protection tool. As both companies face broader regulatory scrutiny worldwide (Temu recently paid $2 million to the FTC to settle INFORM Consumers Act violations), this case may influence how courts evaluate jurisdictional questions in international supply chain disputes and assess claims of DMCA abuse in competitive marketplaces.
October 27, 2025
Sports Entertainment and Media
Neil Young and Backing Band Hit Like a Hurricane, Sued for Trademark Infringement by Luxury Jewelry Brand
Luxury jewelry and apparel brand, Chrome Hearts, LLC has filed a lawsuit against rock legend Neil Young and his current backing band, the Chrome Hearts, in the Central District of California, alleging that both the backing band’s use of the “CHROME HEARTS” phrase and Young's use of "Neil Young and the Chrome Hearts" on merchandise (NYTCH) generates significant consumer confusion in the market, and infringes Chrome Hearts' federally registered CHROME HEARTS trademarks. The complaint asserts five causes of action including, federal trademark infringement, false designation of origin, unfair competition under California law, and common law trademark infringement and unfair competition. Chrome Hearts, which has operated its brand since 1988, and frequently collaborates with well-known musicians, argues that Young's band’s incorporation of the exact CHROME HEARTS word mark on merchandise and promotional materials violates their federally protected rights. In support of their contention, Chrome Hearts alleges salient instances of actual confusion, strengthening the plaintiff’s allegations beyond mere hypotheticals. Per the complaint, multiple apparel vendors have already mistakenly assumed a connection between NYTCH and Chrome Hearts, strongly suggesting the consumer perception of a purported relationship between Chrome Hearts, Young, and his band. The complaint also includes images of specific instances of use of Chrome Hearts designs, or designs evocative of Chrome Hearts’ IP, by third party vendors adorning the t-shirts and other merchandise sold at Young’s concerts, even though Young’s official merchandise does not use Chrome Hearts’ registered designs. The complaint further alleges that Young and Co. had knowledge of the alleged infringement, as Chrome Hearts had sent multiple notice letters regarding this alleged misuse prior to filing suit. Chrome Hearts seeks aggressive relief including temporary, preliminary, and permanent injunctions to halt all use of the NYTCH name and Chrome Hearts marks, mandatory recall and destruction of infringing inventory, and damages including attorney fees. If Chrome Hearts’ allegations make it to trial, we will see whether Neil Young truly has a Heart of Gold, or whether this Old Man’s callous disregard for well-established intellectual property rights were left Down by the River back in 1969.
October 14, 2025
Intellectual Property
Lawsuit Against AI Giant Anthropic Settles
A class action copyright infringement lawsuit brought by U.S. authors against the AI company Anthropic has reached settlement, avoiding a trial set to begin in December. The class of plaintiff-authors alleged in the suit that Anthropic used millions of pirated books without authorization to train its popular Claude AI assistant. This case has had an unusual path to settlement, following a split opinion in June by Northern California District Judge, William Alsup. Alsup held that Anthropic's use of copyrighted works for AI training constituted fair use, but determined the company nonetheless violated copyright law by maintaining pirated books in a "central library" for use far beyond training purposes. This liability exposure, which could have potentially led to billions or even trillions of dollars in penalties assessed against Anthropic if the pending trial did not go its way, was likely the primary factor which drove Anthropic toward settlement. The settlement's broader impact on pending AI copyright litigation against other major defendants such as OpenAI, Microsoft, and Meta remains uncertain, as this landscape of copyright law remains largely unsettled. Just two days following Judge Alsup’s ruling, Northern California District Judge Vince Chhabria issued a somewhat contrasting opinion in a similar authors' lawsuit against Meta, which suggested that Meta's fair use defense held water. However, the judge suggested that the defense could fail if that suit’s plaintiffs adjusted their arguments to indicate AI models’ potential to flood the market with reproductions of the authors’ works. With dozens of AI copyright cases pending, the unpredictability surrounding these novel legal questions may either incentivize additional settlements or encourage defendants to hold out for potentially favorable precedential rulings. As authors, attorneys, executives, and judges alike continue to navigate this new copyright landscape, time will tell whether more AI companies follow in Anthropic’s footsteps and seek dispute resolution before trial.
September 11, 2025
Sports Entertainment and Media
Federal Court Rules SoundExchange Lacks Standing in SiriusXM Royalty Dispute
Judge Naomi Reice Buchwald of the U.S. District Court for the Southern District of New York dismissed SoundExchange's $150 million lawsuit against SiriusXM, finding that the performance rights organization lacks legal standing to pursue litigation against broadcasters. The August 7, 2025, decision centered on allegations by SoundExchange, a non-profit entity designated by Congress as the singular entity responsible for collecting and distributing digital performance royalties for sound recordings, that SiriusXM manipulated its revenue accounting to shortchange artists on royalties stemming from the company’s satellite radio services. SoundExchange based its suit primarily on Section 114 of the U.S. Copyright Act, and claims that the underpaid royalties by SiriusXM have climbed since filing the initial suit in 2023, now allegedly exceeding $400 million. Judge Buchwald's opinion concluded that while Section 114 of the Copyright Act designates SoundExchange as the authority for collecting and distributing digital performance royalties, Congress never explicitly granted the body a private right to enforce nonpayment through litigation —unlike Section 115 — which expressly confers similar litigation powers to The Mechanical Licensing Collective. Notably, Judge Buchwald did not specifically address the merits of SiriusXM’s alleged nonpayment, restricting analysis solely to the threshold issue related to Section 114 of the Copyright Act, potentially leaving a door ajar for further enforcement by SoundExchange. SoundExchange disputed the ruling, calling Judge Buchwald's interpretation "entirely wrong on the law" and argued that Congress's inclusion of the word "enforcement" in Section 114 necessarily implies litigation authority. The organization contends that being charged with collecting and distributing royalties without the ability to bring legal action against non-compliant licensees would undermine the entire statutory licensing framework's function and efficiency. SoundExchange also points to practical precedent, noting as well that SiriusXM has acknowledged in prior disputes that SoundExchange reserves the right to sue for compliance. The ruling may have broader implications beyond the immediate SiriusXM case, affecting SoundExchange's enforcement capabilities across the digital music industry, including pending lawsuits against Napster and Sonos for similar nonpayment. SoundExchange is considering an appeal to the Second Circuit and potentially filing actions in state courts to preserve its enforcement mechanisms. The case presents a fundamental question about Congressional intent in creating the modern digital music licensing framework and whether administrative efficiency requires corresponding enforcement authority, with the resolution likely to have lasting implications for the balance of power between streaming services and rights holders in the music industry.
August 20, 2025
Intellectual Property
Future-Proofing Your Brand During Expansion
Expanding a brand into a new category can be an exciting time. It can also be one of the riskiest moves a brand can make. Branding is more than logos or ad campaigns. It’s about identity, voice, values, and the emotional connection with your audience. Whether it's a fashion house entering beauty, a beverage company exploring wellness, or a tech firm launching a novel product, the potential for growth is enormous. But with that opportunity comes risk. When managed well, brand expansion reinforces that connection, but when rushed or misaligned, it weakens the trust that took years to build. Why Future Proofing Matters from Day One Often, brands treat category expansion like a standalone marketing campaign. They focus on quick wins, media buzz, short-term sales, or a different position in shelf space, which, without a strategic foundation, can backfire. Every product launch, brand partnership, or new line sends a message to consumers about what your brand stands for. That means any missteps risk undermining that story. Future proofing begins by asking tough but essential questions: Does this new product offering align with our brand’s culture? Will our core messaging still align as we scale or expand into new regions or categories? Define the Relationship with the Parent Brand An often undervalued aspect of expansion is the structure that connects the dots on how new offerings relate to the master brand. Will the new product be a sub-brand, an extension, or something distinct and possibly even unrelated? Consider Apple’s ecosystem: iPhone, iPad, Apple Watch, AirPods. Each product serves a unique function, yet they all come together and reinforce the parent brand’s identity of innovation and integration. That clarity builds customer trust and makes each launch feel like a natural extension of what consumers already believe about Apple. In-House vs. Licensed: A Strategic Decision Deciding to build a new category in-house or license it to a third party is important and has significant financial implications. Licensing can offer speed as well as immediate category expertise. Additionally, licensees will generally have established distribution channels in their product category. However, licensing carries the risk of inconsistent execution and diminished brand control. In contrast, in-house development ensures alignment but can stretch internal resources and delay time-to-market. Neither option is inherently better; it depends on your long-term goals. Some brands start with licensing, then bring successful categories in-house to better integrate them into the brand’s DNA. Choose the approach that supports authenticity, quality, and growth over time. Be realistic about what it takes to launch a new product category from product development through sales and distribution. Going Global? Think Local Launching into new regions multiplies complexity, particularly when expanding internationally. What resonates with customers in North America might fall flat in Asia without cultural and regional nuances. A one-size-fits-all global campaign can seem tone deaf. Moreover, international regulations pertaining to product categories can differ substantially, and fluctuating tariffs and trade treaties may also impact a company’s ability to be successful in a country or region. Strong brands can adapt for regional differences in messaging, image, tone, and packaging, etc., while still expressing a consistent global identity. Nevertheless, brands must still learn the local market and its customs, and understand how to navigate and comply with local regulations. Beyond the Launch: The Core of a Future-Proof Brand To future-proof your brand, you need to think beyond launch day. A brand isn’t defined by one product, campaign, or social media moment. It’s how your customers experience and perceive you over time. Strong brands continuously learn from their customers, observing shifts in expectations, sentiment, and values. Gen Z, for example, views itself as a stakeholder in the brands it supports. They expect companies to live up to their stated values, and they take notice and speak out on TikTok when those values ring hollow. Authenticity is key. Internal Culture Is Brand Culture Your external brand reflects your internal culture. When your employees, from C-suite to frontline workers, understand and live the brand’s values, it shows in every customer interaction. Future-proofing your brand requires embedding that alignment throughout your organization. Your brand is reflected in the way products are designed and services are delivered. Everyone should feel a sense of ownership in the brand story and understand how their role contributes to it. Every touchpoint, from social media posts, customer service exchanges, product packaging, and speaking engagements, is a chance to reinforce (or undermine) your brand. Nourish the Brand Ongoing thought leadership helps keep your brand visible, relevant, and aligned with your customers' needs. Great brands often own a point of view in their industry, publishing insights or setting trends that reinforce their authority. Measure what works through perception studies, engagement metrics, and customer feedback, and adapt accordingly. The market will change. Customers will evolve. Competitors will disrupt. Your logo may stay the same or change, but the context in which it operates never does. The launch is just the beginning. Your brand's success depends on how well it fits into a broader, evolving dialogue. Future proofing is about preparing your brand to meet what comes next.
August 8, 2025
Intellectual Property
Voice Actors Clear Early Legal Hurdle in AI Cloning Suit
Voice actors received a rare, if incomplete, victory against alleged AI infringers in a recent opinion from an SDNY judge in Lehrman v. Lovo, Inc. Voice actors Paul Lehrman and Linnea Sage filed an action against AI voiceover company Lovo, alleging the company used artificial intelligence to synthesize and sell unauthorized "clones" of their voices. Plaintiffs discovered their voices being used in YouTube videos and podcasts after they had been hired through the freelancing app, Fiverr, for what they believed were limited voice recording projects used for research purposes. The result is a case of first impression regarding AI voice cloning tech, asserting claims under New York civil rights and consumer protection laws, the Lanham Act, the Copyright Act, and various common law theories, including breach of contract, fraud, conversion, unjust enrichment, and unfair competition. Judge J. Paul Oetken issued a mixed ruling on Lovo's motion to dismiss, concluding that "for the most part, Plaintiffs have not stated cognizable claims under federal trademark and copyright law." The court explained that what plaintiffs sought was essentially "copyright protection for their voices" as abstract concepts rather than specific expressions, and that copyright "must concern the expression of ideas, not the ideas themselves." However, the court did allow the plaintiffs’ breach of contract and right of publicity claims to proceed, finding that communications through Fiverr and the platform's terms of service supported their allegations that the voice recordings were used beyond the agreed scope. The court also moved claims under New York Civil Rights Law Sections 50 and 51 forward, stating that these state laws are "tailored to balance the unique interests at stake" in voice misappropriation cases. While the ruling represents a partial victory for the voice actors, it highlights significant gaps in federal intellectual property protections for AI-generated content and voice cloning technology. The court's decision suggests that voice actors and similar plaintiffs may find more success pursuing state law remedies for unauthorized AI voice cloning rather than relying on federal copyright protections.
August 6, 2025
Estates and Trusts
Estate Planning for Musicians and Protecting Your Legacy Off the Stage
For musicians, estate planning is not just about deciding who inherits guitar collections or song royalties. It is about protecting your artistic legacy, ensuring your intellectual property is handled according to your wishes, and providing clarity for loved ones who may be unfamiliar with the nuances of the music industry. Unlike a typical estate plan, musicians face unique considerations, especially when it comes to rights management, royalties, and long-term protection of their creative works. Whether you are a seasoned performer or an up-and-coming artist, here are essential estate planning steps every musician should take. Catalog and Protect Your Intellectual Property Your songs, recordings, compositions, and even unreleased material are valuable assets. The first step is creating a comprehensive inventory of your published works, unreleased recordings or demos, copyright registrations, licensing agreements, and publishing contracts. Ensure these assets are clearly documented in your estate plan, which means if you have a revocable trust in place, these assets must be “assigned” to that trust to avoid probate. You should also provide instructions to your trustee or executor on how these assets should be managed, distributed, and monetized after your death. Establish Ownership Structures for Royalties Royalties can continue to generate income long after a musician’s passing. To ensure proper management, it is most efficient to set up a trust to collect and distribute these royalties to your beneficiaries. A trust can provide the mechanism to provide ongoing support to your loved ones to ensure they receive the funds in a way that makes sense, particularly if your beneficiaries are minors. Having a trust in place can also make it easier to manage the various income streams to ensure they flow centrally during your life in the way that you intend. Certain trusts can even provide creditor protection, protection from estate disputes, and mismanagement if you become incapacitated. When a trust is created, it is important to think about who will serve as your trustee if you can no longer act, or upon your death. The trustee chosen by you should have familiarity with your intellectual property, royalties, licensing, and the value of your catalogue. Assign Control Over Your Artistic Legacy Do you want your unreleased recordings shared with the world? Should certain songs be licensed for commercials or films? It is essential that you appoint the right person with this level of discretion to answer these questions because they can determine how your music is used after your death. It is, therefore, vital to ensure that the person you assign the control has an understanding of your legacy. This person is often referred to as a “creative executor” or a “creative trustee” who understands your artistic vision and can carry out your wishes regarding issues like posthumous releases, licensing decisions, and the preservation of your work. Digital Assets and Social Media A musician’s online presence can be as valuable as their physical recordings. A properly drafted estate plan will include instructions regarding your social media profiles, your official website, your digital music platforms (Spotify, Apple Music, YouTube channels), and access to each of those platforms. You may direct whether these platforms should remain active as they were during your life, or if you would prefer that they remain active as a memorial or taken down altogether. Business Succession Planning for Bands or Labels If you own a record label, music publishing company, or are part of a band with business agreements, succession planning is critical. Ensure that your partnership agreements address what happens in the event of your death or incapacity and how ownership interests will be transferred or managed. Your operating agreements and shareholder agreements should be reflective of your wishes and must address your particular circumstance; failure to do so allows your state to determine how those interests can be transferred or managed. Plan for Personal Assets and Family Needs Beyond your musical career, you must ensure that you have a traditional estate plan in place that also addresses bequests to your family members and friends, guardianship of your children, and designations of health agents and powers of attorney. If your musical career is successful, you should consider the issue of estate tax and consult with an insurance professional for life insurance policies that could provide economic support for your family or liquidity to pay estate tax. If your music catalog has significant value, proactive estate tax planning is essential. Strategies might include gifting portions of your catalog during your lifetime, setting up irrevocable trusts to shield assets, and working with a valuation expert to determine accurate appraisals for estate tax purposes. Musicians, like most artists, often experience fluctuating incomes, so proper planning is crucial for providing long-term security to loved ones. Final Thoughts Proper planning is the ultimate backstage pass to your legacy. It empowers musicians to control not just the financial aspects of their legacy, but also the integrity and future of their creative works. Without a solid plan, disputes over rights, royalties, and artistic decisions can tarnish the legacy you have worked so hard to build.
August 5, 2025
Intellectual Property
Patents and the FDA: Four Critical Considerations Medical Device Companies Must Know to Successfully Introduce New Products into the Market
The intersection of patent strategy and FDA regulatory strategy is a critical consideration for medical device companies. A well-integrated approach can create powerful barriers to entry, strengthen intellectual property (IP) portfolios, reduce risk, and attract investors. This article explores key issues and strategies to ensure your patent and FDA efforts work together effectively. An integrated patent and FDA strategy adds significant value to the business. Many companies focus solely on regulatory approval, overlooking how FDA submissions might affect their patent portfolio or vice versa. A coordinated approach between patent strategy and FDA strategy offers significant benefits to the business: stronger patent protection combined with FDA exclusivity creates complementary barriers to entry for competitors. This enhances your ability to protect innovations and ensures your patent strategy is embedded within the regulatory framework for the product that will be sold. Value for investors or later strategic acquirers is a direct result of an integrated patent and FDA strategy. Four areas where medical device regulation and patent law overlap that must be implemented carefully include: patent coverage in view of FDA submissions, Freedom-To-Operate (FTO) risk, product Labeling and Patent Marking, and patent term extension (PTE). Patent Coverage and FDA Submissions Regulatory submissions often include technical details that can affect patent protection. To avoid premature disclosures and ensure alignment, file patents before submitting your regulatory documents to the FDA. While you may have filed for protection early during the product development process, reassessing the product just before submission is an important step to ensure your patents cover what you are seeking to market in the United States. Patent counsel should certainly have the opportunity to consider the filing documents, in ALL of their detail, to consider new patent filings to augment your patent strategy. This strategy also serves other important purposes, like preventing premature public disclosures (e.g., in 510(k) summaries) that could compromise patent rights. Well-crafted summaries and filing documents could limit the usefulness of the confidential FDA data obtainable via Freedom of Information Act (FOIA) requests. Importantly, this key action ensures consistency between FDA filings and patent claims, avoiding statements that could lead to unenforceability due to inequitable conduct. In other words, saying one thing to the FDA that is inconsistent or contrary to the position you are taking regarding prior art can lead (it has) to a finding by the Court that patents are unenforceable. In addition, products evolve, certainly during development, but even after market introduction. A robust use of continuation patent applications can help maintain adequate protection as the product evolves. There are numerous benefits to considering FDA filings in light of the patent strategy and not doing this simple task is a wasteful use of resources. Talk to your patent counsel! Third-Party Patent Risk and Freedom to Operate (FTO) Patent litigation is prevalent in the medical device industry, and failure to consider your products’ freedom to operate can destroy business value. Before submitting a device for FDA approval, conduct FTO studies to identify potential infringement risks. These should include an analysis of IP related to predicate devices, especially for 510(k) submissions. In addition, understanding patents that cover competitive products is another key step in this process. Avoid using language in FDA submissions that could serve as a roadmap for infringement, such as instructions for use or device descriptions. Carefully drafting these documents is a viable way to limit risk and minimize the disclosure of otherwise proprietary information that is not Germane to the purpose of the FDA submission but might otherwise be important in the third-party patent context. Update FTO studies at key milestones, such as before submitting an investigation device exemption, 510(k), or PMA submissions. This is the best way to minimize patent risk once the product is approved, and the ever-important sales begin. Conducting this analysis based on what your business is authorized to sell in the U.S. is a critical consideration because patent risk only flows from making, selling, using, and importing into the U.S. a product that infringes a valid claim of a U.S. patent. Understanding the patent landscape related to the products that have high revenue generation potential is a required but pragmatic business practice to implement. Product Labeling, Patent Marking and Maximizing Damages Patent marking plays a crucial role in infringement cases. Generally, a patent owner is entitled to damages only after the infringer has been notified—either through a cease-and-desist letter, a lawsuit, or compliance with the patent marking statute. Because the FDA regulates product labeling, companies can implement their patent marking during regulatory submission, and in particular, where product labels are concerned. The U.S. allows for virtual patent marking, where a URL (e.g., mycompany.com/patents) is included on the product label. Once the product receives market clearance with this label, damages can accrue from that point forward. Failing to implement this strategy could delay damage accrual until after a lawsuit or cease-and-desist letter is issued. This can be potentially years after market introduction. A simple URL on a label, submitted with your FDA documents, can make a significant financial difference in your patent infringement case, should you need to file one later. There is no simpler way to increase patent value than to implement patent marking on product labels during the FDA approval process. Patent Term Extension (PTE) for FDA-Regulated Products Patents last 20 years from the date a non-provisional U.S. application is filed. During that time, the patent owner has exclusive rights to the patented invention. Once expired, however, others may freely use the invention. However, certain devices, and Pre-Market Approval (PMA) products specifically, can qualify for up to an additional five years of patent term extension. To be eligible for PTE, the product must have undergone a regulatory review period before it can be commercially marketed. The patent must not have been previously extended, and the application for PTE must be filed within a specific timeframe (typically 60 days) after the product receives regulatory approval. This extended exclusivity can significantly impact revenue. Companies should therefore actively monitor regulatory timelines to ensure the timely filing of patent term extension requests. Carefully consider the most valuable patent for extension because there is only one extension per regulatory approval allowed under the law. And finally, avoid delays during prosecution, such as taking extensions of time to file a response, as each extension of time can reduce the potential extension period. In summary, four things that can maximize business value for your medical device are: Align patent filings with FDA submissions to ensure broad, enforceable claims. Conduct and update FTO studies throughout the product lifecycle. Share FDA submission materials with patent counsel to avoid inconsistencies. Incorporate virtual patent marking into FDA labeling at the earliest possible instance. File for patent term extension when available. A successful medical device launch requires a great deal from a business. A robust patent strategy, integrated with the FDA framework, can only support a successful launch; it will not hinder it. By proactively aligning regulatory and patent efforts, companies can secure stronger protection, reduce risk, and enhance business value.
July 16, 2025
Intellectual Property
Supreme Court to Hear Cox Communications Case on ISP Copyright Liability
On June 30, 2025, the Supreme Court accepted a petition for certiorari brought by Cox Communications, and denied one brought by Sony in the same matter, following the advice of Solicitor General Sauer. The dispute stems from a massive $1 billion copyright infringement verdict against Cox Communications, in which music publishers (including Sony, Universal, and Warner Music, among others) alleged that Cox was liable for the illegal distribution of 10,017 musical works by the ISPs subscribers. The Fourth Circuit previously affirmed a lower court’s ruling that Cox was liable to the plaintiff publishers for contributory infringement, while overturning the lower court’s finding of vicarious liability. As a result, both Cox and Sony filed competing petitions for certiorari seeking clarification from the Supreme Court regarding different aspects of ISP copyright liability. The Supreme Court will review two critical questions that could reshape how internet service providers handle copyright infringement. First, whether an ISP materially contributes to copyright infringement by continuing to provide internet access to particular subscribers after receiving notice that their accounts have been linked to active and ongoing copyright infringement. The Department of Justice noted this ruling creates "substantial tension" with a recent Supreme Court analysis of contributory liability in Twitter v. Taamneh, where the Court found that mere passive provision of services without active assistance doesn't constitute contributory liability. Second, the Court will examine the "circumstances under which a contributory infringer can be held liable for enhanced statutory damages based on a finding of "willful infringement,"" specifically whether knowledge of subscriber infringement alone suffices for a willfulness finding or if the ISP must have reasonably believed its own conduct violated copyright law. The decision could fundamentally alter how ISPs manage their networks and respond to copyright infringement notices, with Cox arguing that overly broad liability standards could jeopardize internet access for all Americans. Depending on the outcome of this case, American internet users may see ISPs tighten their grip when enforcing against pirate websites or unauthorized distributors of IP, as ISPs aim to minimize any and all liability potential. We will continue to keep this space updated as the case progresses.
July 11, 2025
Intellectual Property
When to Patent: Common Mistakes Business Leaders Make
Suppose a newly hired engineer on your team sketches a promising new concept for a health monitor in a notebook. Excited by the idea, you loop in marketing, and soon, your company is promoting the product’s features through emails, vlogs, and website posts. The sales team runs with it, offering the product to customers even though the device isn’t fully developed. Meanwhile, you start seeking investors, sharing pitch decks that highlight the product’s potential, projected revenues, and market opportunity. Then comes the first investor call. The question is immediate: “Is it protected?” You haven’t filed a patent, but you sidestep the question and end the conversation. Only then do you call your patent counsel. After hearing the story, their response is sobering: “Much of the damage is already done. We may not have a strong path to protection.” What went wrong? In short, you missed the critical window to file a patent application—after the concept was created but before any public disclosure or marketing. That single misstep may have cost you your ability to secure patent rights. But in reality, a sketch alone usually isn’t enough to file a strong application. So what should have happened instead? When is the Right Time to File for Patent Protection? Knowing when to file for patent protection is critical. Filing too late, as described above, and you risk losing key rights or losing the patent race to your competition. File too early, before there is a business case or before further concept development, and you may not have all the details needed to secure quality patent rights. Filing the right patent applications at the right time transforms your patent portfolio into a high-return investment that protects your competitive edge and supports your next phase of growth. The ideal time would be: Before You Go Public To preserve your rights—in the United States and especially in international markets—it is critical to file for patent protection before your invention is made public, especially in the way it is “made public,” as in the example described above. U.S. law bars the grant of patents for inventions that are patented, described in a printed publication, in public use, on sale, or otherwise available to the public before the effective filing date of the claimed invention. 35 USC § 102(a). Thus, the first stage of review should occur before emails, vlogs, posts on your website, and publications about the product are created. Indeed, these publicity-raising tactics are all things that potentially bar patent rights. Even offering your invention for sale, with a price term and quantity, to customers, as in the scenario above, is sufficient to invoke this provision of patent law, which prohibits securing patent protection in the future for the product sold. Finding a mechanism to alter or delay publication or offer for sale is a critical aspect of a patent strategy that can help preserve patent rights, which any business should implement. In short, any activity that includes publishing, pitching, selling, presenting at a conference, or even demonstrating your invention in public or a non-confidential setting can cause harm to your patent strategy. Despite the bars to patent described, U.S. law grants innovators some exceptions to this rule, such as the inventors’ own work, if made within one year of filing for protection. For example, should an inventor publish the invention in some form, you have one year to file patent protection to avoid losing those patent rights. However, this can be risky, as you often do not know what your competitors may be working on or even if they have completed a patent filing within that one-year timeframe. Additionally, should an inventor share the invention with a third party, such as a potential investor or supplier, there is a risk that the third party could file for its own protection for the concept before you do. They could even combine that shared content with their work, making it difficult for you to secure patents. While there are some provisions under U.S. law to sort this out, for example through derivation proceedings, these complex procedures can be avoided by filing for patent protection before sharing the invention with any third party, as in our example above. When It’s More Than an Idea A completed product that is ready for marketing and manufacturing is sufficient and ready for patenting. Mere concepts and ideas are often not enough to secure quality patent rights. Patent law requires an enabled, written description of the invention, along with patent claims that specifically set out the scope of the invention. This often demands a reasonable level of detail of the invention, its working principle, and a description of various alternatives that might be used in the future by the market you are planning to serve through your business. There is no requirement to submit a working model or software code for software-related inventions, for example. However, there is a need to include reasonable details related to the invention and alternatives, so that meaningful patent protection can be secured. The objective is to do more than merely describe the conceptual goals of the product; details matter here as you and your patent counsel will want to rely on passages of the patent text to craft the desired patent claims during the prosecution of the patent application in the future. This ensures that you can cover the technology you are developing and also address competitive threats through amendments to the claims as needed. Without details in the patent application that anticipates what might happen in the future regarding the underlying products, your options for securing meaningful patent protection are limited, if not barred altogether. Conclusion So when do you file for protection? In our example above, a significant amount of engineering and development remains in order to get the product ready for the market and manufacturing at scale. In this case, it would make sense to consider filing for patent protection once the idea has been developed enough that you can describe how it works and how it will be used in the market. That clarity also increases the strategic value of your patent, as described above. In addition, while there is ongoing product development is common, consider filing for patent protection at key development milestones, such as completion of market studies, when a significant technical hurdle is overcome, and before substantial capital outlays are required, such as the development of production models or the purchase of capital equipment. Do not consider a single patent filing sufficient enough to protect the product adequately. Additional filings should be made as the product changes over time. This ensures that your patents align with the business's commercial plans. If there’s an urgent business need, it’s important to file a patent application quickly, even if the product is still in development. For instance, investors and partners want to see that you’re protecting the innovation that underpins your business. Filing a patent application before sharing the idea is critical and an appropriate step, as it creates a tangible asset that can help secure funding or favorable deals. This changes the conversation with investors completely, in our example, and focuses the discussion on the more important aspects of an investment, such as valuation and revenue. Sometimes, this requires filing before the concept is fully vetted and complete. That is okay, as you can file as a provisional application and then file follow-on patent applications that cover the key innovations you develop as the product matures into a business-ready revenue stream. If you have partners or employees that make premature publication of the invention, as discussed above, be sure to file a provisional application ahead of time, even if there is only enough information to cover the broad concept. Again, follow-on patent filings can be used to strengthen earlier filed but “sparse” provisional patent applications. Filing a patent at the right time is a strategic move that protects the investments you’ve already made in R&D, product development, and innovation. Getting the timing right is an vital aspect of implementing a robust patent strategy that secures patent rights for the business. Best practice is to file for patent protection, via a provisional application or regular patent application, before any public facing activities begin. Furthermore, executing a robust non-disclosure agreement (NDA) with anyone whom you plan to share information regarding the invention will give you added protection, while also minimizing the effect of such disclosure on foreign patent rights. For instance, you might consider an NDA with a potential investor before sharing information with them, or other situations with a potential supplier or contract manufacturer. Losing patent rights can be significant and can undermine your commercial objectives. More specifically, delaying patent protection can cost you: Priority rights, if a competitor files first. Ability to license or sell the technology. Legal protections in global markets. The opportunity to support valuation and fundraising efforts. In short, failing to file timely or filing late can remove a competitive advantage you once had, minimizes potential revenue streams, and lessens likelihood of meaningful investment.
June 27, 2025
Intellectual Property
Jimmy Page Accused of Infringing 'Dazed and Confused'
If the ongoing acrimony between Daryl Hall and John Oates wasn’t enough to fill the void of aging rock stars airing their grievances in court, never fear. There’s an endless well where that came from. Jake Holmes, original writer and composer of the song Dazed and Confused, has sued Led Zeppelin’s Jimmy Page, among other musical production and publishing entities, for damages related to a songwriting credit he feels he is owed. Indeed, Holmes wrote the now-iconic hit in 1967, at which time Jimmy Page heard the song and rearranged the composition for his then-outfit, The Yardbirds. Page would later work with Robert Plant to reimagine the song for their upstart band, Led Zeppelin, again neglecting to credit Holmes for his role in the song’s creation. Off the heels of a now-settled 2010 lawsuit regarding the issue, the recently released documentary, Becoming Led Zeppelin, has brought the song, and Holmes’ claims, back into public consciousness. Doubtless, Holmes wanted to strike while the iron is hot. Plaintiff Holmes filed a complaint in the U.S. District Court for the Central District of California, asserting three primary claims: two for copyright infringement and one for breach of contract. Holmes alleges he is the sole copyright owner of Dazed and Confused, originally registered in 1967. He claims that Jimmy Page and associated defendants, willfully infringed on this copyright by exploiting the composition without authorization—first in connection with the Yardbirds’ performances and later through its use in the 2025 documentary Becoming Led Zeppelin. Holmes's complaint alleges that, despite a 2011 settlement agreement (resolving the prior 2010 suit, which affirmed Holmes’s exclusive rights to the composition), Jimmy Page, Succubus Music Ltd., and WC Music Corp. continued to falsely license and monetize recordings of Dazed and Confused as if Page were the sole author. Holmes contends that these recordings include numerous Yardbirds live releases and that the defendants generated revenue from licensing, streaming, and royalties without proper attribution or payment to Holmes. Additionally, Holmes claims that the recent documentary film Becoming Led Zeppelin incorporated unauthorized performances of Dazed and Confused—both by the Yardbirds and by Led Zeppelin—again falsely crediting Page and excluding Holmes. He asserts that multiple defendants, including major production and distribution entities like Sony Pictures Classics and Big Beach LLC, participated in the infringing activity. Holmes seeks actual or statutory damages, injunctive relief, an accounting of profits, and attorneys' fees, alleging willful infringement and breach of the 2011 settlement agreement. This new action has the potential to set a standard for infringement cases regarding works so central to the infringing entity’s identity as to reframe that entity’s success completely. Time will tell whether Page’s Levee will finally Break, or whether Page and Zeppelin will Ramble On as they have for the past 50+ years.
May 28, 2025
Intellectual Property
Building a Patent Strategy that Actually Works for Your Business
If your business relies on bringing innovations to market that generate returns on investment, then a well-designed patent strategy is critical for realizing those returns. Patents help introduce new products to the market, secure investment, and establish your business’s competitive edge, all supporting and controlling the top and bottom lines. A thoughtful patent strategy simply helps turn innovation into long-term business value. However, achieving this long-term business value requires you to consider patents as part of the big picture of your business; business goals, market dynamics, and product roadmap are all important. Patents are not simply a check-the-box activity or even pure costs; they are investments in the future of your business. But how do you turn patents--powerful legal rights-- into business value? Start With the ‘Why’ Before jumping into the legal process, consider what patents could do for your business. Do you need to: Protect the core technology that drives your revenue? Create barriers to entry for competitors? Support a licensing model or open new revenue streams? Make your business more attractive to investors, acquirers or strategic partners? If the answer is yes to any of the above, a proactive patent strategy deserves a place in your broader business plan. Timing is Critical Patent law rewards those who act early in the innovation process. In fact, certain activities can result in the loss of patent rights. It is important to file for patent protection for an innovation before disclosing your invention publicly, whether through a sale, publication, presentation, or even a demonstration. But timing is a balancing act. Concepts that are too general or have not undergone some level of technical and market vetting may not be ready for patenting, but filing too late, after public disclosure can be catastrophic. Aim to file for patent protection when you can describe a clear use case and the market can identify key technical features important for that use case and market, ideally before you raise funds or launch publicly. Today, product development often requires engaging third parties early in the process. Two tactical steps can be used to bolster your strategy and provide some flexibility in timing: Use non-disclosure agreements with third parties you need to share your concept with to get help File provisional applications if you want to secure a filing date while continuing to refine the invention. Think Beyond One Patent Your strategy shouldn’t stop with one patent application or even one type of patent. Patents grant you the right to exclude others from making, using, or selling the invention as claimed. But patents often are not broad blocking patents. Patents are often focused on incremental innovations, and patent law generally limits one patent per invention. Often, several inventions are built into a product, and robust protection would therefore require multiple patents. You may need to: Protect multiple components or processes within a single product. File in international markets where you plan to sell or manufacture the product. Keep an eye on adjacent technologies and file follow-on continuation patents as your product and market evolve. At least considering these options allows you to manage your patent strategy to your product roadmap, keep an eye on competitive threats, and help manage your patent more proactively. Patents are Investments, Not Costs Filing a patent isn’t just a line item on your legal budget — it’s an investment in your business’s future. Like any other asset, patents have the potential to generate returns, whether through increased valuation, market exclusivity, licensing opportunities, or strategic advantage. What makes patents more of an investment than just a budget line item? First, delaying or forgoing patents gives your competitors a free pass to use innovations you developed for their own gain. Without patents, competitors will capitalize on what your business introduced to the market, leaving little recourse for you after the fact. Those competitors can then file patents that could hamper your ability to sell your products. This has a direct impact on the topline and undermines R&D investment. Proactive patent protection avoids this altogether and serves as a competitive deterrent. Second, patents can help add revenue through licensing. However, licensing revenue is nearly impossible without legal rights protecting the products. Patents are an effective tool to support licensing or acquisition opportunities. Third, patents attract and retain capital. Investors always ask if the technology has protection. The larger the investments you seek, the more scrutiny will be placed on your patent strategy and how it relates to the technology supporting your innovations. Investors often look for competitive advantages, and patents provide that. Patents are assets and can help support business valuations that facilitate investment. Related to direct investments, patents can also act as collateral to secured transactions, facilitating investment or debt for financing other parts of the business. Without patents protecting your technology, you are forgoing an effective tool that drives investor confidence, which, in turn, drives investment in your business. A well-timed, well-aligned patent strategy doesn’t just protect what you’ve built, it helps justify and maximize the investments you’re already making in innovation. Treat patents as part of your business assets and budget for them accordingly. Encourage Internal Innovation An intentional patent strategy doesn’t just protect innovation, it helps fuel it. When your innovators know there’s a process in place to capture and evaluate their ideas, they’re more likely to share them. Encouraging your team to share and disclose ideas that may be patentable unlocks potentially patentable concepts that can support your business goals. A great way to maximize patent value is to create an invention disclosure system that harvests innovations within your organization while rewarding disclosure among your team. This can form the basis for an engaged team oriented towards protection innovation. An excellent supplement, patent seminars can help educate your staff about the patent process and what it takes to be an inventor under U.S. law. The Bottom Line A strong patent strategy isn’t about legal red tape; it's about creating leverage, supporting your growth, and building real, lasting value. Treating patents as an investment—not a cost—unlocks their full potential as a driver of innovation, funding and long-term success.
May 23, 2025
Intellectual Property
Trademark Registration Misconceptions: What Brand Owners Should Know
Many business owners view trademark registration as a smart investment—and they’re right. A federal registration gives you valuable legal advantages, including nationwide priority, a presumption of ownership, and stronger tools to protect your brand. But registering a trademark doesn’t give you absolute control. Whether you can prevent someone else from using a similar name or logo often depends on a few key questions: Who used the trademark first? If another party has prior rights, their use may be protected. Are they using it for the same or related goods/services? If you're operating in unrelated industries, another party’s use may not be infringing. Understanding these factors can help you protect your brand more effectively and avoid common trademark misconceptions. Trademark Protection Is Limited to Specific Goods and Services A trademark registration does not prevent others from using a similar or identical name, logo, or slogan in unrelated industries. Trademark law is designed to prevent consumer confusion—not to grant brand owners exclusive control over a word or phrase in all contexts. Your trademark rights are fundamentally tied to the goods and services that you sell under your brand name, logo, or other source indicator (i.e., trademark). You can register a trademark to use in connection with the sale of specific goods and services, not for everything. A perfect, real-world example of this can be found at the corner of Broadway and W 68th Street in New York City, where for several years, a LOWE’S® hardware store sat directly across from a LOEWS® movie theater. Despite the nearly identical pronunciation and similar spelling, both brands coexisted peacefully—and legally—because they operate in entirely different industries. Even though the names are similar, consumers are not likely to confuse a home improvement store with a movie theater or think that there is any shared ownership. The goods and services they offer are so different that consumers would not likely assume the two businesses are affiliated. (The Lowe’s eventually closed, but it was likely due to the lack of need for a big-box home improvement store in the heart of Manhattan rather than any trademark conflict.) If two businesses operate in distinct industries with different audiences and purposes, similar names can often legally coexist. “I Had It First”: Why First Use Still Matters When two companies are trading in related commercial spaces (i.e., selling similar goods or services to one another) under the same or similar trademarks, U.S. trademark law will generally favor the party that was using it first. That’s why, before applying for federal registration, your trademark attorney will typically conduct a search to identify existing registrations, pending applications for registration, and unregistered (or “common law”) uses of the mark. The term "common law" refers to trademark rights that arise through the actual use of the mark in commerce, even without formal registration. Suppose you're opening a bakery in North Carolina called “Maple & Bean.” A common law search reveals a small café in Vermont that has used that name locally for years but never registered it. If you and your trademark attorney agree that the reward outweighs the risk and there are no other conflicts, the USPTO may grant you a trademark registration. But even with that registration, the Vermont café would retain the right to use the name in its existing geographic area because it used it first. Your registration would, however, generally allow you to prevent others from using the same or a confusingly similar name for related goods or services going forward. However, it wouldn’t give you the right to stop someone from using “Bean & Maple” for products in unrelated industries, like glassblowing tools or HVAC systems. In short, trademark protection is both industry-specific and use-based. Registration strengthens your rights but doesn’t erase earlier uses—or give you absolute authority over all uses. Conclusion A federal trademark registration is a valuable asset, but its scope is not unlimited. Trademark rights are determined by both first use and the specific goods and services involved, making enforcement a fact-specific analysis. Understanding these nuances can help businesses manage their trademark rights effectively and avoid common misconceptions about registration.
April 2, 2025
Intellectual Property
Navigating the USPTO’s New Trademark Fees
It’s finally here. After months of warnings, announcements, and uneasiness about their application, the U.S. Patent and Trademark Office implemented a number of trademark-related fee changes in January 2025. These fees changes, though, are more than just fee increases. Many of the new fee changes will require new filing practices and strategies to keep Trademark Office fees to a minimum, especially for filings by foreign applicants. Make Sure Your Application Has All Required Information In the past, it was possible to file an application without all of the required information. For example, an application could be filed without a signature and the signature submitted later. While this is still possible, applications filed without the required information will now be subject to an “insufficient information fee” of $100 per class. In some instances, these fees will be incurred at the time of filing (the electronic filing form is supposed to indicate what omissions will incur this fee), and in some instances, they will be incurred during the examination. For example, if an application is for the name of a living individual and is filed without written consent, or if the application is for a mark that is a foreign word and is filed without a translation, the application will incur an insufficient information fee during prosecution. Further, the insufficient information fee will be charged to new classes that are added to an application during prosecution if the application was filed with insufficient information. The Trademark Office does permit pre-examination amendments. The Trademark Office has advised, however, that using a pre-examination amendment to supplement an application with information omitted from the application at filing will wind up incurring the insufficient information fee during prosecution, eliminating a tool that was often used when an application needed to be filed in a hurry. These changes will put a premium on evaluating an application before it is filed to make sure that some effort is made to address all necessary requirements (e.g., a description of the mark, a transliteration, a color claim, applicant’s name, address, and domicile; etc.) Use the ID Manual Applications with listings of goods and services taken from the Trademark Office’s ID Manual (available here: https://idm-tmng.uspto.gov/id-master-list-public.html) are now charged a lower filing fee ($350) than those with listings not taken from the ID Manual ($550). Thus, using the ID Manual where possible is beneficial. In order to be entitled to the lower fee, each item in the listing for a particular class must be taken from the ID Manual. If one item in the listing is not from the ID Manual, then the higher fee will be charged. Further, the Trademark Office has explained that if any text is entered in what it calls the “free-form text” box in an application, the higher fee will be charged, even if some or all of the listings are taken from the ID Manual. Using descriptions from the ID Manual is not necessarily a guarantee that an applicant will be able to avoid the higher filing fee. Some descriptions in the ID Manual require applicants to fill in certain information. Guidance from the Trademark Office indicates that if a good faith attempt to fill in that information is made, the applicant will not be charged the additional fee during examination (use of a description such as “Printed educational materials in the field of specify subject matter” would not be considered a good faith attempt). In those situations, it will be up to the examining attorneys to determine if a good-faith attempt has been made. That will be a subjective determination, and it seems fair to expect the Trademark Office to take its familiar position that one examining attorney is not bound by the acts of another when determining what constitutes good faith. The Trademark Office has also indicated that if a party uses, in good faith, descriptions from the ID Manual and then is required to amend those descriptions, the additional fee will not be charged. Moreover, if an applicant files an application with a description from the ID Manual and then amends to a specification that is not in the ID Manual, the application will not incur the additional charge. One issue with the ID Manual is that it does not list every good or service (this can be a particular issue with new products, technology, etc.). One option for resolving this issue is to ask that a particular description be added to the ID Manual. This can be done by sending an email to tmidsuggest@uspto.gov with the following information: the name of the party submitting the proposed identification; an email address for correspondence relating to the proposed identification; and the proposed identification, which should be concise and no more than 25 words. Depending on how long it takes the Trademark Office to add descriptions to the ID Manual, that may not be a practical option (the Trademark Office’s website suggests that reviews will take 1 to 2 business days, and that accepted updates will be made in the next weekly update, but whether that time frame is accurate remains to be seen). Trademark Office guidance indicates that the insufficient information fee will not apply to issues with descriptions of goods or services. Keep Specifications Short One goal of the Trademark Office is to cut down on lengthy descriptions of goods and services. Thus, the Trademark Office has implemented a new fee of $200 per class where a specification entered as free-form text is in excess of 1,000 characters (the fee does not apply to specifications derived entirely from the ID Manual). The fee applies for each group of characters over 1,000, so a specification over 1,000 characters would incur a fee of $200 and a specification over 2,000 characters would incur a fee of $400. According to the Trademark Office, this fee will only be applied at the time an application is filed and will not be assessed during examination. Consider Filing Multiple Applications Instead of Multiclass Applications While a multiclass application may seem like it would be less expensive, under the Trademark Office’s new rules, it could actually be more expensive. For example, any insufficient information fees will be assessed against each class in an application. Further, if an application has two classes, and the description of goods or services for one is taken from the ID Manual and the other is entered as free-form text, both classes will be charged the additional fee due to the use of the free-form text feature. Additionally, if an application is filed using the free-form text option and a new class is added during examination, the fee for that class will be the higher fee, even if the description of the goods or services in that class is taken from the ID Manual. While it can be difficult to predict whether additional classes will have to be added during prosecution, filing a single class application rather than a multiclass application can reduce the likelihood that the higher fee will be incurred. File Through the Madrid Protocol, If You Can Applications filed through the Madrid Protocol are not subject to the new fees discussed above, making that an attractive means of filing in the United States. Use of the Madrid Protocol already had benefits not afforded to direct filings in the U.S.; applicants who file through the Madrid Protocol have six months in which to respond to any Office Actions that may be issued, rather than the three-month response period for applicants who file directly in the U.S., and this will continue to be the case. Applications filed directly in the U.S. will be subject to the Trademark Office’s new fees, even if those applications are filed based on foreign applications or registrations or claim priority to a foreign application or registration. Anyone considering filing directly in the U.S. based on a foreign application or registration would be well served to match the goods or services description in their home filing to those in the Trademark Office’s ID Manual, if possible, in order to avoid additional fees. If the application is based on a foreign application or registration that has already been filed, consider paring down lengthy specifications to avoid surcharges. A Note on Pending Applications Applications filed before January 18, 2025, will not be subject to any of the new fees if filed as TEAS Standard applications. Applications filed before January 18 as TEAS Plus applications (at the lower filing fee) may incur the insufficient information fee, if appropriate. Conclusion The Trademark Office’s fee changes have ushered in a brave new world of trademark practice in the United States. Only time will tell if these changes will accomplish the Trademark Office’s goals. At this point there are some means of avoiding the imposition of the Trademark Office’s new fees (particularly with some planning), and it is likely that the new fees will cause filers from outside of the U.S. to increase their use of the Madrid Protocol. In the end, though, the new fees and procedures reinforce the importance of working with skilled counsel to secure registration of a mark in as efficient a manner as possible.
February 17, 2025
Intellectual Property
Branding the Produce Aisle: Appealing to Consumer Tastes
Brands are taking over the produce aisle at the grocery store. They have already conquered the cereal aisle, the soda aisle, the chips aisle, and the cookie aisle (my favorite). While there have always been produce brands (Chiquita ® bananas or Dole pineapple), branded fruits and vegetables are proliferating. Newly branded fruits include the Elefante Green Gold pineapple, the Pink Elephant mango, and Cotton Candy grapes. The question is, why is there such a push to put stickers with a brand name on fruits and vegetables? Product Recognition and Differentiation From a legal point of view, product recognition and differentiation is the main reason to adopt a brand name. A brand name helps consumers identify a product, and helps that product stand out from other similar products. Which item are you more likely to remember—an apple or a Jazz apple? A banana or a Chiquita banana? It is possible for branding to be so successful that the brand name loses its ability to differentiate products. This is what happened to brands like aspirin and escalator, and it is something that brands like Xerox and Google fight against. Avoiding consumer confusion—or making sure that a brand name differentiates one party’s goods or services from another’s —is the whole point of trademark law. If consumers can distinguish one party’s brand from another’s, then there is no trademark infringement. If consumers think that the brands are related or associated with each other, then there is infringement. This is why the infringement analysis generally looks beyond the marks being used and the goods or services they are used on to other factors, such as price point, where the goods or services are being sold, and whether there was an intent to confuse consumers. Brand Loyalty Strong, dependable brands can encourage brand loyalty (repeat business). If you buy Cotton Candy grapes and love the way they taste, you are more likely to purchase them again with the expectation that you will be able to experience that great taste again. A negative experience, though, can cause a consumer to search for another brand of product. Brand loyalty can be a powerful driver of business. Think about it. How many times have you gone to the store and purchased something because you (or someone you know) used it before and it worked well? Sometimes brand loyalty is the result of an emotional connection to a brand. Perhaps you remember a brand from your childhood, or interacted with that brand when you were a child. Maybe you had a certain brand of drink with lunch in elementary school, or you remember your grandfather giving you a particular type of candy when you would visit. It could even be that you remember liking the advertising for a product when you were younger. This is one of the reasons why people often try to “revive” defunct brands, a practice that raises all sorts of questions about the ownership of the brand and the goodwill associated with it. Branded Items Seem More Exclusive The fashion industry has long since learned that branding can make a product seem more exclusive. One reason is that branded items can command a higher price. The store brand is almost always less expensive than the branded equivalent, whether in the grocery store or the department store. In some cases, the fruits are considered luxury items. This can be because they are genetically engineered, like Del Monte’s Pinkglow pineapple, which has white flesh, an edible core and low acidity, or the Cotton Candy grape, which is sweeter than a usual grape and tastes like cotton candy. In other cases, it is because small quantities are grown. To protect the names of these new fruits, growers seek trademark protection. After spending years to develop the fruits themselves (intentionally bred varieties of fruit trees and nut trees can be protected by a plant patent in the U.S., and genes, traits, methods, and plant parts can be protected by a U.S. utility patent), there is little reason not to protect the brand name, especially since that is what customers will ask for at the grocery store. Currently there are issued registrations or pending trademark applications for the following: COTTON CANDY, for grapes (Reg. No. 4109691) ELEFANTE GREEN GOLD, for pineapples (Reg. No. 7492189) PINKGLOW, for pineapples (Reg. No. 6330579) RUBYGLOW, for pineapples (Reg. No. 7507675) , for melons (Reg. No. 7154543) Branding is Everywhere It shouldn’t really be much of a surprise that brands are coming to the produce aisle. Branded items have been coming home with us from stores for a long time, and various factors drive the success and longevity of a brand. Without protection, though, a brand’s prospects for longevity are diminished and the brand is subject to appropriation or misuse by others. Trademark protection can help ensure the continued vitality of any brand, whether that brand appears on the most fashionable catwalks, in movie theaters, in a stadium, or in the grocery store.
January 8, 2025
Intellectual Property
OK Alert | Understanding the FTC’s New “Click-to-Cancel” Rule
Businesses that automatically charge their customers on a recurring basis may have to update their practices to comply with new consumer protection regulations. The Federal Trade Commission (FTC) has introduced a new “click-to-cancel” rule that places stricter requirements on negative option programs—business models that require customers to actively cancel or opt out to stop recurring charges. Common iterations of negative option programs include free trials that roll into paid subscriptions, recurring delivery services, automatic renewals, and similar continuous service agreements. While these programs offer convenience for consumers and predictable revenue for businesses, the new rule comes as a response to persistent consumer allegations of unfair and deceptive practices in some negative option programs. The FTC’s new “click-to-cancel” rule requires: Transparency: All program terms (billing frequency, total costs, how to cancel, etc.) must be disclosed clearly and conspicuously. Businesses cannot bury this information in fine print or hard-to-find sections of their websites or agreements. Consent: Businesses must obtain explicit, informed consent from consumers before collecting billing information and should retain these consent records for at least three years. Ease of cancellation: Canceling must be as easy as signing up, with no hidden barriers or cumbersome processes. In short, this rule aims to ensure consumers know what they are signing up for. Businesses must now clearly disclose the program terms, secure consumer consent before billing, and make it straightforward to cancel. When to comply: Exact dates for compliance have not been announced yet. The rule will begin to take effect 60 days after it is published in the Federal Register. Various provisions will also have staggered compliance dates, making the timeline more complex. Additionally, there are lawsuits challenging the rule that could lead to potential delays or pauses in implementation, adding further uncertainty. It may be advisable to consult with a lawyer on your specific compliance needs. Insights and best practices: Even if the rule is delayed or does not take effect, there are business advantages to proactive compliance. The practices defined in the “click-to-cancel” rule—clear terms, consent, and an easy cancellation process—address common consumer frustrations. Implementing transparent business practices can help you build consumer trust and goodwill, a quantifiable business asset. More information: The FTC announced the “click-to-cancel” rule in a press release on October 16, 2024. The full proposed text for the final “click-to-cancel” rule can be found here: Final Rule Concerning Recurring Subscriptions and Other Negative Option Programs, 16 CFR part 425. The following week, industry groups began challenging the FTC’s new “click-to-cancel” rule in the U.S. Courts of Appeals. On October 22, 2024, Electronic Security Association v. FTC (24-60542) was filed in the 5th Circuit and Michigan Press Association v. FTC (24-3912) was filed in the 6th Circuit. Offit Kurman will continue monitoring developments surrounding this new rule.
November 4, 2024
Intellectual Property
It’s a Plaintiff, it’s a Baby, it’s SUPERBABIES!
Able to cancel 4 trademark registrations in a single filing, a comic book company called Superbabies Limited has done what once seemed impossible: They have achieved the cancellation of trademark registrations for SUPER HERO and SUPER HEROES, registered since as far back as 1967 and jointly owned by comic behemoths Marvel and DC Comics. Superbabies claimed that SUPER HERO and SUPER HEROES are generic, and also that Marvel and DC had abandoned any trademark rights by failing to use the terms as trademarks. Although Marvel and DC entered an appearance in the Trademark Trial and Appeal Board (TTAB) proceeding, they never answered the petition for cancellation, leading Superbabies to file a motion for a default judgment. The TTAB, noting that Marvel and DC Comics did not contest the motion, ordered the cancellation and faster than Spiderman can scale a skyscraper, the registrations were canceled the same day. It's safe to say that Marvel and DC did not miss two deadlines by accident. Rather than bring out the Avengers to fight this tooth and nail, it is likely that they realized they couldn't win and instead opted for truth (that the marks are generic), justice (SUPER HERO and SUPER HEROES should be free for all to use), and the American way (allowing the judicial process to make the determination). Superbabies' Petition for Cancellation is fun. The first allegation is: "We live in a world of superheroes. For the better part of a century, superheroes and the superhero genre have ruled the imagination and inspired millions to achieve greatness." From there, it contains snippets of comics, including Marvel and DC comics, in which the heroes and villains alike make use of the legal system to achieve their means. It goes on to demonstrate why Superbabies believes that SUPER HERO and SUPER HEROES are generic. When Marvel and DC saw this, they probably realized that this was the sixth Infinity Stone and that their claim of trademark ownership had turned to dust.
September 27, 2024
Intellectual Property
Pre-Emptively Filing a Trademark Application Over a Viral Catchphrase, Not Very Demure
On August 5, 2024, the life of TikTok content creator Jools Lebron changed after she posted a video that went viral. In the video, Lebron uses the phrase “very demure, very mindful, very cutesy.” That TikTok has since been viewed over 23 million times. Lebron has gone on to appear on Jimmy Kimmel Live and snagged endorsements with Zillow, Verizon and K18 hair. However, Lebron’s joy was dampened after she discovered that an individual named Jefferson A. Bates filed a trademark application with the United States Patent and Trademark Office (“USPTO”) for the wordmark “very demure .. very mindful ..” Bates’ application was filed on August 20, 2024, for advertising, marketing and promotional services related to all industries for the purpose of facilitating networking and socializing opportunities for business purposes. Since then, a few other trademark applications involving the words “demure” and “mindful” have popped up. But what even is the implication of these trademark applications to Lebron’s growing popularity and association with the catchphrase “very demure?” Can she continue to use the phrase in her videos or for the sale of merchandise? Under the Lanham Act, the standard test of trademark ownership is a priority of use in the marketplace. This means that ownership of a trademark is acquired by use in the ordinary course of trade, for example, by selling merchandise with the mark. On the other hand, trademark registration creates a legal presumption of ownership and provides notice of such ownership to the public. A trademark registration is obtained by submitting an application to the USPTO for the registration of the trademark. Such an application may be based upon actual use in federally regulated commerce. However, it is quite common to submit a trademark application as a way to reserve trademark rights prior to, but in anticipation of, actual use of the mark, as long as a declaration of bona fide intent-to-use in federally regulated commerce is submitted with the application, although an applicant under the intent-to-use category, will ultimately be required to submit a declaration of actual use before registration is granted. Bates’ trademark application alone does not reserve or guarantee his ownership of the “very demure .. very mindful ..” mark. Registering a mark involves a review by an examining attorney from the USPTO, and the process can take up to 18 months. During the review process, the examining attorney reviews the application to make sure it meets all legal requirements for registration. In fact, the USPTO may even reject the application for various legal reasons. For example, if the application conflicts with a mark that has already been registered or that is pending registration, the USPTO will issue an office action. An office action is a letter from the USPTO informing an applicant of the issues with a trademark application. An office action must be resolved before registration can be granted. After the review process, the trademark is published in the Trademark Official Gazette. At this point, any member of the public can oppose the registration of the trademark within 30 days of the publication. Alternatively, a letter of protest may be submitted with the USPTO. Even though filing a federal trademark application could provide Bates with some protection, trademark rights are automatically acquired through use of the mark in the marketplace. Thus, any protection that Bates may have received from his application may be subject to the rights of earlier users of the mark in the marketplace. However, can Lebron’s iconic use of the phrase in her TikTok videos be considered prior use in commerce? In decided cases, the Trademark Board has explained that mere advertising without rendering services under a mark could, in some circumstances, constitute use sufficient to prove priority. Every case is different, and the decision of the Trademark Board depends on the specifics at hand. Lebron can certainly continue to make videos using the viral catchphrase, but the clock may have started ticking on a race to the marketplace. Navigating the trademark application process or opposing the registration of a trademark can be confusing. If you are concerned about understanding how trademark rights can protect your business and brand name, we recommend consulting with an intellectual property attorney to discuss your options.
September 9, 2024
Intellectual Property
Protecting Your Most Important Asset: Why Trademark Registration Matters
What would you do with an asset with an almost infinite lifespan that symbolizes your company to your customers? And if that asset was your company’s most valuable asset? You’d protect it, of course. If you run a business of any type, you have such an asset: a trademark, often referred to as a brand name. The question is, are you protecting it? Trademarks reportedly account for about one-third of the stock market value of companies in the S&P 500. If your company is not protecting one of its most important assets, it is putting that asset at risk. The first step in protecting a trademark is registering it with the U.S. Trademark Office. This legal process is best handled by lawyers and involves some costs. In many cases, the cost to register in the U.S. is under $5,000, although it can exceed that amount. Renewal costs are generally under $2,500, with renewal needed every ten years. Given the nearly unlimited lifespan of a trademark, these costs are well worth it when considering the benefits of registration. Banks Will Take Trademarks as Collateral for Loans Some banks, such as IDB, will accept a security interest in a company’s trademarks as collateral for a loan. In today’s business landscape, where many businesses operate virtually and lack significant physical assets, having an asset that a bank can lend against can be crucial for a company’s growth. However, without a registered trademark, a bank may be unwilling to lend against it. At best, the bank may impose higher lending costs if it is willing to lend against unregistered trademarks. Parties Doing Business with a Company Want Assurance that the Company’s Brand is Protected Investors considering investing in a company will want to see that it has taken steps to protect its trademarks. As part of their due diligence efforts, they will ask for the details of trademark applications or registrations. If there are no applications or registrations, providing a transparent and honest explanation is necessary. Potential partners, such as licensees or franchisees, will also want to see that the company has taken steps to protect its trademarks if they invest money to do business with the company, whether by opening a franchised store or manufacturing and selling licensed goods; these partners will want assurance that the company has protected their mutual investment. Trademarks are Crucial to a Company’s Value As noted, a significant portion of a company’s value can be attributed to its brand. Companies with strong brands deliver better value to their shareholders.[1] The value of those assets is critical in business valuations, mergers, or acquisitions, providing leverage and opportunities for future sales and expansion. If you are considering selling your business and retiring, trademark registration can significantly increase its value. Given this potential boost, isn’t the cost of registration worth it? Trademark Registrations May Prevent Others from Registering the Same or a Similar Mark Trademark registrations are listed in the Federal Trademark Office’s online database, which is publicly available and searchable. Anyone searching for a similar trademark should find any registrations that your company owns. Upon discovering your company’s registration, third parties may drop or change their plans. Additionally, when the Trademark Office examines applications filed by others, it will refuse the registration of the same or similar marks for the same or related goods and services. However, if your mark is not registered, the Trademark Office will not block the registration of the same or a similar mark. The Trademark Office only reviews its records during the examination process. It does not search the marketplace, which can result in a competitor registering a similar mark. While it is possible to challenge such a registration, doing so can be costly in terms of time and money. It is far better to prevent this situation by ensuring your mark is registered in the first place. While the Trademark Office will block potentially infringing third-party applications, it does not take action to stop third parties from infringing your company’s trademark. The responsibility to enforce trademark rights falls on the trademark owner. Further, once your company’s mark is registered, you gain nationwide rights that can be enforced against subsequent users. Without a registration, your rights are limited to the geographic area in which your company operates. One other thing. Forming a company with the state is not the same as registering a trademark. The state does not check to see if your name will infringe on anyone else’s name when you form a company. Having a Trademark Registration Makes Enforcement Easier on Online Platforms If someone uses your mark without authorization on social media or an online shopping platform, having a trademark registration makes it easier to enforce your company’s rights and have the online platform take action to stop the infringement. A registration allows the platform to verify your rights, which they cannot do if your company has no trademark registration. Additionally, a trademark registration grants your company access to online protection mechanisms, such as Amazon’s Brand Registry. In cybersquatting cases, which still occur, having a trademark registration simplifies proving your case and recovering the domain name in question. However, a trademark registration does not automatically entitle your company to the corresponding domain name. Legal Benefits of Registration Having a trademark registration provides certain legal advantages. For example, lawsuits for infringement of federal trademark registrations can be filed in federal court. In such cases, registration entitles the trademark owner to a legal presumption of ownership, the right to use the mark, and the mark’s validity (validity presumption applies only to registrations on the Principal Register). These presumptions can streamline court proceedings and reduce legal expenses. Without registration, your company must prove ownership, usage rights, and protection eligibility in every enforcement action, resulting in increased costs. Additionally, marks registered on the Principal Register can achieve incontestable status after five years of registration, provided an appropriate filing is made with the Trademark Office. Incontestable status means the registration can only be challenged on specific, limited grounds. Furthermore, registered marks can use the ® symbol to indicate they are registered. This can prevent third parties from adopting similar marks and, more importantly, prevent infringers from arguing in a lawsuit that your company waived its right to damages by not using the ® symbol. Using the ® symbol helps ensure you do not inadvertently leave money on the table. Foreign Trademark Registrations A U.S. trademark registration does not afford trademark protection outside the U.S.; trademark rights must be protected country by country. However, a U.S. trademark registration can serve as the basis for trademark filings abroad and enable your company to benefit from certain international treaties that may reduce the cost of filing in other countries. Recording Registrations with Customs and Border Protection (CBP) A trademark registration on the Principal Register can be recorded with Customs and Border Protection (CBP). However, there is a fee for this service. Recording your registration with CBP allows them to monitor goods coming into the country. If CBP identifies goods with an infringing or counterfeit mark, they will stop their importation and seize the items. While CBP may request verification that the goods are not legitimate, once that confirmation is provided, CBP will manage the seizure process. Conclusion Trademark registration offers several cost-saving benefits. Legal presumptions and the status of incontestable registrations can reduce court costs. Additionally, registered marks make it easier to enforce rights online. A U.S. trademark registration can also reduce the costs of filing for registrations in other countries and can be recorded with CBP to assist in enforcing your rights. Beyond these cost-reducing benefits, trademarks are high-value assets that can serve as collateral for loans and that investors and business partners will want to see. Therefore, trademarks should be protected with the same diligence as any other asset. Failing to protect this asset can result in its loss and a subsequent loss in value for the company — an outcome no company would or should permit. [1] See The top 100 most valuable global brands 2013 (marketingweek.com).
July 24, 2024
Intellectual Property
AI-Generated Works Dilemma: Balancing AI Terms of Service With Contractual Obligations
Like any emerging technology, AI is entangled with legal issues. These legal issues may not make for compelling entertainment, but they are important in shaping the use and potential of AI. The Legal Intelligencer Pop culture generally depicts artificial intelligence (AI) in extremes, from benevolent helpers like Rosie the Robot from “The Jetsons” to malevolent entities bent on humanity’s destruction, like HAL 9000 from 2001 or SkyNet from “The Terminator” movies. While these depictions make for captivating entertainment, they are far from the reality of today’s AI. Like any emerging technology, AI is entangled with legal issues. These legal issues may not make for compelling entertainment, but they are important in shaping the use and potential of AI. While no member of the Jetson household had to accept terms of service before instructing Rosie the Robot, contracts—terms of service—governing the use of AI, such as Dall-E and Midjourney, carry significant implications that users and their counsel should understand. This is especially true when creators utilize AI to generate works and designs for clients. For example, consider the scenario where a furniture store commissions a design firm to create a unique carpeting design that can be used to manufacture carpets to be sold at the store. Looking to expedite the creation of the design, the designer inputs a prompt to their chosen AI tool, which promptly generates a design. Let’s use this scenario as the starting point to explore some pertinent questions. Ownership of AI-Generated Designs Under U.S. copyright law, ownership of designs typically resides with the creator unless they assign their rights to their client in writing (copyright assignments must be in writing; see 17 U.S.C. Section 204). In this case, though, there is another layer. Who owns the work created by the AI? To answer that question, one must turn to the AI’s terms of service. Midjourney’s terms of service state that “User owns all assets they create with the services to the fullest extent possible under applicable law.” (see “Terms of Service,” visited March 9, 2024). Similarly, Dall-E’s terms of service state that “as between you and OpenAI, and to the extent permitted by applicable law, you retain your ownership rights in Input and own the output. We hereby assign to you all our right, title, and interest, if any, in and to output” (see “Terms of Use,” visited March 9, 2024). While such terms may resolve the issue in many cases, they fall short here because the assignment may not have much value. The Copyright Office has determined that copyright in AI-generated work can only be registered if there is a sufficient level of human involvement, although the specific level of involvement remains unclear [see Thaler v. Perlmutter, No. CV 22-1564 (BAH) (D.D.C. Aug. 18, 2023)]. While this ruling may not directly affect the question of ownership, it significantly impacts the enforceability of rights in AI-generated works. AI-Generated Designs Are Not Exclusive When clients hire a designer to create a carpeting design, they often seek an exclusive, original design distinct from designs used by others. In the traditional situation without AI involvement, the contract between the designer and the client typically states that the design will be exclusive to the client, even if the client does not own the copyright in the design. While Midjourney and Dall-E’s terms of service state that the user owns all rights in the AI-generated work, they also contain language giving the AI the right to use that output. Thus, Midjourney’s terms of service state that: by using the services, You grant to Midjourney, its successors, and assigns a perpetual, worldwide, non-exclusive, sublicensable no-charge, royalty-free, irrevocable copyright license to reproduce, prepare derivative works of, publicly display, publicly perform, sublicense, and distribute text and image prompts You input into the services, as well as any assets produced by You through the service. This license survives termination of this agreement by any party, for any reason. Dall-E’s terms of service are slightly less explicit, stating, “We may use content to provide, maintain, develop, and improve our services, comply with applicable law, enforce our terms and policies, and keep our services safe.” The meaning of both provisions is the same: any work created by the AI will be incorporated back into the system and utilized to generate new works in response to new user prompts. While Midjourney offers a potential solution, if users pay a subscription fee, this option only requires Midjourney to use its best efforts to refrain from publishing any output. This scenario raises multiple questions for our carpet designer. If the contract requires exclusivity for the design, AI utilization would seemingly breach this provision. Dall-E’s terms of service acknowledge the potential dissemination of designs to others, noting that “due to the nature of our services and artificial intelligence generally, output may not be unique and other users may receive similar output from our services.” This makes it very difficult, if not impossible, for designers utilizing AI to assure clients of design exclusivity. Further, the Copyright Office’s stance on copyright in AI-generated works means that neither the designer nor the client could sue a third party for infringement if that third party used a design incorporating elements of the AI-generated design. A lawsuit for copyright infringement cannot be brought without a copyright registration, as the U.S. Supreme Court ruled in Fourth Estate v. Wall-Street.com, 586 U.S. ___, 139 S. Ct. 881 (2019). However, as discussed above, the Copyright Office generally does not issue registrations for AI-generated works. What If the AI-Generated Design Infringes on Someone Else’s Work? A standard agreement between a designer and their client typically includes a warranty and representation that the design will be original and noninfringing. However, can a designer who uses AI to create a design genuinely make such a representation? At best, it appears challenging to assert a complete absence of infringement. More than contractual breaches are at stake. The designer’s reputation could be on the line, too, if it becomes known that AI was used to create a design that unintentionally infringed upon another’s work. Taking this a step further, multiple lawsuits are pending alleging copyright infringement because the AI involved in these cases was trained using copyrighted materials. Assuming these allegations are true, it is possible that in response to a designer’s prompt, an AI could generate a work incorporating elements of someone else’s copyrighted material or the entirety of someone else’s material, potentially leading to copyright infringement liability for the designer. The designer could also be liable to those involved in manufacturing the carpet for the store and possible wholesale partners, making the consequences for the designer that much worse. While no such cases have yet emerged in the United States, multiple AI companies have offered to indemnify users against claims of copyright infringement (see “OpenAI offers to indemnify ChatGPT customers for copyright infringement,” visited March 9, 2024). However, the value of such indemnification offers may be limited, especially if the AI companies are flooded with requests and cannot afford to indemnify all users. Furthermore, it remains unclear whether such indemnification from the AI companies would extend to the designer’s client in cases of resale. Although their interests are likely aligned, clients may prefer assurance that their interests will be actively defended. Additionally, the indemnification offered by the AI companies may not cover claims for breach of contract by the client against the designer, leaving the designer potentially liable to their client. Conclusion If Rosie the Robot had to grapple with these contract issues, completing her assigned tasks might have become more challenging (perhaps imposing legal requirements on SkyNet could have prevented its homicidal tendencies). The reality is that we must consider these legal provisions, which can carry significant consequences for AI users, most of whom likely overlook them. One solution is to avoid using AI altogether when creating designs, but this seems increasingly unrealistic with each passing day. Rather, contractual language may have to be updated to account for AI and how it functions. However, this adaptation will require time, and likely involve legal disputes. In the meantime, it’s crucial for all parties, including designers, to recognize the risks associated with using AI. Reprinted with permission from the April 16, 2024, edition of The Legal Intelligencer © 2024 ALM Global Properties, LLC. All rights reserved. Further duplication without permission is prohibited, contact 877-256-2472 or asset-and-logo-licensing@alm.com.
May 1, 2024
Intellectual Property
Elevating Your Brand: Insights from Bridgerton's Licensing Success
When Bridgerton returns, its influence won’t be confined to the small screen. Now, thanks to a licensing arrangement with Ruggables, you can bring the elegance of Bridgerton into your home. Known for their diverse collaborations with iconic brands like Star Wars, Architectural Digest, Keith Haring, and Jonathan Adler, Ruggables has extended the Bridgerton aesthetic to your home. Since February, Bridgerton rugs have adorned homes, adding a touch of sophistication reminiscent of the beloved period drama. And the collaboration doesn’t stop there – a partnership with Bath & Body Works brought Bridgerton-inspired scents into personal care this past March. Given Bridgerton’s immense popularity, its expansion beyond the small screen should come as no surprise. In fact, it is following a path well-worn by other entertainment giants: licensing. Licensing can be a powerful tool for expanding a brand’s footprint, yet it carries significant risks. While a well-executed licensing program, such as the one that accompanied the release of last summer’s Barbie release, can create the illusion of ubiquity and fuel a seemingly insatiable demand for branded merchandise, it’s essential to recognize that success in licensing is not easily achieved. Behind every triumph lies diligent effort and meticulous planning. The initial step involves figuring out which products seamlessly complement the brand. Bridgerton’s meticulous attention to detail and well-appointed sets, such as Danbury House or Aubrey Hall, coupled with the buzz surrounding the show’s aesthetic, make a collaboration with Ruggable an ideal choice. This partnership effortlessly extends the visual appeal of the show into the homes of its audience. Next up is the crucial step of ensuring that the brand to be licensed is protected, which involves filing trademark applications to protect the mark associated with the goods slated for licensing. Notably, Netflix owns a U.S. trademark registration for BRIDGERTON covering entertainment services. It has a pending application covering an array of goods and services (e.g., cosmetics, electronic devices, jewelry, handbags, home linens, dishware, clothing, toys, and food). However, it is worth noting that rugs are notably absent from this coverage. One of the most critical parts of licensing is finding a partner you can trust (such as Ruggable, which boasts licensing arrangements with other major brands, likely facilitating its collaboration with Bridgerton). Why? Through licensing, you are giving up some control over your brand. It’s imperative to have confidence that your partner will exercise the same care about your brand as you do and that they will work hard to make the license successful. Plus, ensuring they fulfill their obligations under the license, such as making timely payments and adhering to ethical standards like avoiding child labor, is crucial. Remember, your licensing partners are a reflection of your brand; any missteps on their part could tarnish your reputation, especially in the eyes of discerning observers like Lady Whisteldown. Of course, no one has a crystal ball, and unforeseen events can create issues. That is precisely why a well-drafted license agreement is essential to any licensing effort. This agreement should comprehensively outline all the pertinent business terms, including territory, duration, channels of trade, licensed products, royalty rates, and more. Additionally, it should have mechanisms for termination, should such action become necessary. If, for some reason, the license arrangement does not work out, it is the terms of the license agreement that will control the parties’ relationship moving forward. From a brand owner’s point of view, the quality control provisions within a license agreement hold paramount importance. There are several compelling reasons for this. Firstly, the brand owner’s primary objective is to uphold the brand’s reputation by ensuring that licensed products maintain high-quality standards and reflect the brand’s core values. Consequently, license agreements often grant brand owners the authority to approve prototypes and production items. It's imperative for brand owners to promptly provide approvals to avoid disrupting marketing plans. Secondly, failure to exercise quality control could result in what is known as “naked licensing,” which can result in the potential forfeiture of their trademark rights. While a good quality control provision in the license agreement serves as a preventative measure to a naked license situation, the brand owner’s active monitoring of product quality is essential. After all, consumers seeing a brand on a product will assume that the product meets certain standards of quality. And as you know, dear reader, Queen Charlotte can be exacting. This year’s diamond of the licensing season could well be the rug collaboration. If you are seeking to elevate your brand to new heights of success in the upcoming season, I’m here to provide professional guidance in crafting and executing a dynamic licensing program. Let’s work together to ensure your brand shines brighter than ever before in the competitive world of licensing.
April 23, 2024
Intellectual Property
Navigating Trademark Complexities: Meta’s Brazilian Setback
Meta Platforms Inc., the behemoth that owns Facebook, Instagram, Threads and others, recently faced a court in Brazil that prohibited the company from using the Meta trademark in the country. A digital transformation consultancy has held a registered trademark for Meta in Brazil since 1990, resulting in Meta Platforms being blocked from using the trademark. The refusal in Brazil demonstrates the challenges inherent in global branding. For one thing, searching for the availability of trademarks worldwide is prohibitively expensive for many businesses. Of course, Meta is a deep-pocketed company that likely researched the availability of this trademark far and wide before announcing their decision to change their name from Facebook in October 2021. However, for reasons unknown, the company went forward with the rebrand, even though this obstacle existed in one of the largest countries in the world. Of course, we do not know what Meta’s team of lawyers advised, but regardless, the company finds itself in an unfortunate situation, unable to use META in Brazil. This scenario is not limited to international borders; it can also occur within the United States. A trademark registration, which can be obtained if a business uses a trademark in more than one state, provides nationwide rights and protections against later users. But what happens when one company adopts a brand that is already used in a part of the United States? The junior user may need to select one trademark to use in one part of the country and a different one for the rest of the country. Such is the case with the ice cream brand Dreyer’s, which people in the eastern half of the U.S. know as Edy’s. When Dreyer’s came along, there was already a well-known brand of ice cream sold in supermarkets called Breyers. Photo courtesy of Laura Winston Photo courtesy of Laura Winston Another instance is Hellmann’s mayonnaise, known as Best Foods mayonnaise west of the Rocky Mountains. The U.S. Patent and Trademark Office may grant what is known as a “concurrent use registration,” which carves out the territories in which each party has the rights derived from mark registration. This is an exception that challenges the principle that a trademark registration provides nationwide rights. Whether your business is going global or you are considering expanding within the United States, it is best to consult with an attorney who can advise you about the best ways to protect and expand your trademark rights. If you have any questions, please feel free to reach out.
April 4, 2024
Intellectual Property
Lights, Camera, Trademark: The Unsung Heroes of the Oscars
Oscar night is the most glamorous night in Hollywood. The red carpet. The gold statuettes. The gowns. The tuxedos. The stars. The trademarks. That’s right, the trademarks. They are essential to the movie industry, and when we celebrate the best in the movies, we should also celebrate the unforgettable trademarks that go along with the motion picture industry. The equipment used to make and show movies are all emblazoned with trademarks. We’ve all seen PANAFLEX or PANAVISION cameras in behind-the-scenes documentaries. Most of us have seen movies in IMAX, and we have heard movies in DOLBY SURROUND SOUND, DOLBY ATMOS, or DTS. Or maybe we’ve even seen a movie in CINEMASCOPE (Disney’s 20,000 Leagues Under the Seas, for example). We’ve probably watched movies with special effects from ILM, DIGITAL DOMAIN, and WETA. Almost all of us have seen a movie in an AMC or REGAL CINEMAS theater, or maybe we have seen where the stars have signed their names and left their handprints outside of GRAUMAN’S CHINESE THEATER in Los Angeles. That theater is so well-known that the look of the building is registered as a trademark. The studio and production company names that appear at the beginning of films are great examples of trademarks, indicating the source of the movie that viewers are watching. PARAMOUNT, PIXAR, WARNER BROTHERS, RKO, UNIVERSAL, SONY, COLUMBIA PICTURES, A24, ORION PICTURES, FOCUS FEATURES, BAD ROBOT, and AMBLIN are all trademarks. So are the roaring lion that introduces MGM films, the Twentieth Century Fox Fanfare, and Netflix’s “Tudum” sound. The water tower on the Warner Brothers lot is also a trademark. That brings us to the movies themselves. The U.S. Trademark Office will not register the title of a single work (this is true for books, too); rather, it will only register the title of a series (meaning two or more movies). While none of this year’s Best Picture nominees are part of a series, plenty of movie series titles are registered trademarks: BACK TO THE FUTURE, JURASSIC PARK, STAR WARS, MISSION: IMPOSSIBLE, DUNE, THE GODFATHER, BARBERSHOP, MADEA, and GODZILLA to name a few. Even some characters and props are the subjects of trademark registrations. Mickey Mouse, for one, is a registered trademark (trademark protection for characters is not always available). There are trademark registrations for multiple lightsaber hilts, as well as the X-Wing Fighter. In Europe, the owner of James Bond has a number of trademark registrations, including one for the well-known gun barrel sequence, and one for one the famous spy’s iconic poses. At least some movie brands have received legal advice and sought trademark protection. Thus, there are registrations for STAY PUFT (for marshmallows), STARK INDUSTRIES (for clothing), THE DAILY PLANET (also for clothing), WILLY WONKA (for candy), BUBBA GUMP (for restaurants), THE MIGHTY DUCKS (for hockey). Of course, we should not forget that Mattel has a trademark registration for the shade of pink associated with BARBIE. And yes, the golden statuette itself is a trademark, so all those who took one home took home a trademark. It’s the most glamorous night in Hollywood, and the trademarks have the best seats.
March 7, 2024
Intellectual Property
Trademark Use in the U.S.
Demystifying What Constitutes an Acceptable Specimen of Use Evidence of use is, in most circumstances, essential to securing and maintaining a U.S. trademark registration. Subject to certain limited exceptions involving foreign trademarks, the U.S. Trademark Office will not issue a U.S. trademark registration without appropriate proof of use. Similarly, to maintain a U.S. trademark registration, a registrant must submit adequate proof of use to the Trademark Office. While this sounds straightforward, in practice, it can sometimes be very difficult to find evidence of use that the Trademark Office will accept. According to the Trademark Manual of Examining Procedure, § 904, specimens “are required because they show the manner in which the mark is seen by the public.” Acceptable specimens can be labels and tags affixed to goods or the containers for goods (but not mockups), stampings on products, commercial packaging, screenshots from a computer program or a frame of a movie or video, a website from which software can be downloaded, point of sale displays, catalogs with ordering information, websites from which products can be ordered, and manuals. TMEP §§ 904.03 (a) through 904.03 (k). On the other hand, printer’s proofs, mockups, renderings, and advertising materials are generally not acceptable as evidence of use. TMEP §§ 904.03 (a) through 904.03 (k). Once evidence of use is submitted, the Trademark Office will examine it carefully. If it is not accepted, an Office Action will be issued, after which one will have the ability to submit a substitute specimen that was in use as of the pertinent date (usually the date on which the original specimen was submitted). TMEP § 904.05. Obtaining an acceptable specimen is often one of the most difficult parts of preparing a trademark application or a maintenance filing. This is in part because the Trademark Office examines them so carefully but also partly because there is a desire to avoid the expense of repeated filings with the Trademark Office. Indeed, failure to submit an acceptable specimen can lead to the refusal of an application, as demonstrated by a recent case. Hi-Tech Pharmaceuticals, Inc. sought to register EXPERIMENTAL AND APPLIED SCIENCES as a trademark for use in connection with dietary and nutritional supplements. As evidence of use, it submitted an original specimen and a substitute specimen. The original specimen was five pages long, consisting of a screen capture of a web page showing five different products. The proposed mark did not appear on the first page, but it did appear on close-ups of two supplement bottles that were part of the specimen. The close-ups showed the proposed mark on the lower back portion of the label, on one line of a four-line group. All four lines were the same color, appeared in the same font size and style, and had the same justification. The proposed mark appeared at the end of the following sentence: “Developed and exclusively manufactured by Experimental And Applied Sciences”; because of its positioning, the proposed mark was on the second line. The next line had the applicant’s address, and the following line had the applicant’s phone number and website address. The Examining Attorney refused registration of the mark, taking the position that the evidence of use showed the proposed mark being used as a trade name, not as a trademark (the submitted evidence did not show the proposed mark anywhere else on the bottle). The Trademark Trial and Appeal Board affirmed on appeal, agreeing with the Examining Attorney that the “applicant would be hard-put to present the term in a less prominent manner.” (emphasis in original). The TTAB explained that the proposed mark appeared as part of a visual unit and that, as a result, the impression was that the proposed mark should be read in the context of the lines around it. Therefore, registration was refused. An acceptable specimen would have led to a different result. While the Hi-Tech Pharmaceuticals case was in the context of seeking registration of a mark, it applies with equal force to maintenance filings—an improper specimen can lead to the cancellation of a registration mark. Thus, in either context, it is important to work with experienced counsel to make sure that a mark is being used in a manner that demonstrates trademark use and that will be accepted by the Trademark Office. If there is any doubt about whether the Trademark Office will accept use, please contact me (preferably well in advance of any deadlines).
February 29, 2024
Intellectual Property
Upcycling, Customization, and Trademark Infringement
With its potential environmental and sustainability benefits, upcycling is a popular trend. Likewise, product customization, allowing consumers to express their own style, is also popular. As illustrated by two cases involving watches, both can give rise to claims of trademark infringement and counterfeiting. Rolex Watch USA, Inc. v. BecekerTime, L.L.C. BeckerTime is a seller of decades-old preowned watches containing Rolex parts. BeckerTime identifies such watches as “Genuine Rolex,” but they include both Rolex and non-Rolex parts. Before taking action, Rolex purchased two watches from BeckerTime. BeckerTime added diamonds as hour markers to the refinished watch dials by drilling holes in the dials and inserting aftermarket diamonds or other stones and settings in the holes. As part of the refurbishment process, BeckerTime strips the dial down to bare metal, and once the refurbishment is complete, it reapplies Rolex’s trademarks. When selling the modified watches, BeckerTime lists a retail price with a comparison price labeled as “New MSRP (if all factory)”— even though Rolex does not and has never sold a similar watch. Additionally, BeckerTime adds various non-Rolex parts (such as bezels with added diamonds, bands, or straps). BeckerTime issues an “Authenticity Guarantee” for each watch it sells and has held itself out as a “Certified PreOwned Watch Dealer” with a “Rolex Certified Master Watchmaker” even though Rolex has not certified BeckerTime or its watchmaker. Moreover, the parts added by BeckerTime are integral to the function of the watches and do not bear any markings indicating that BeckerTime is the source of the watches. To be sure, BeckerTime did indicate on its website that the replacement parts were not genuine Rolex parts, that the alterations it makes would void any Rolex warranty, and that BeckerTime is not affiliated with Rolex. That was not enough to stave off legal action. Rolex sued BeckerTime for trademark counterfeiting and trademark infringement in September 2020. After a bench trial, the court found that BeckerTime infringed Rolex’s trademark by counterfeiting Rolex watches and issued an injunction precluding BeckerTime from using Rolex’s trademark in specific ways. Both parties appealed, and the court of appeals largely upheld the injunction. The court of appeals explained that “BeckerTime does more than recondition or repair vintage Rolex watches.” According to the court of appeals, BeckerTime sold watches that were materially different from those sold by Rolex; the watches could not be called genuine Rolex watches. The court of appeals also pointed out that customers were confused as to whether the watches were entirely genuine Rolex and that BeckerTime had received complaints about the quality of the watches. As a result, the court of appeals affirmed the injunction, although it did instruct the lower court to clarify one point. Hamilton Intern. Ltd. v. Vortic LLC Like the BeckerTime case, this case also involved watches. The outcome was very different. Robert Thomas Custer founded Vortic and endeavored to make a watch that would be entirely made in America. After learning that no active company in the U.S. made watch movements, Vortic began salvaging and restoring parts from antique American-made pocket watches manufactured in the late 1800s and early 1900s. The parts, which included antique parts from watches bearing Hamilton’s trademark, were then encased in new wristwatches. One of the watches Vortic made was named “The Lancaster,” after the city where the Hamilton Watch Company was originally based. The Lancaster features restored antique pocket watch movements and front dials made by Hamilton. The front dial bears the HAMILTON trademark. The watch strap, case, and various internal parts were either manufactured by Vortic or came from modern U.S. sources. The back of the watch has a glass cover through which the watch parts, some of which bear the HAMILTON trademark, can be seen. The cover is surrounded by a metal ring with Vortic’s name and serial number for the watch, as well as the watch’s name. Buyers received the watch in a wooden box with Vortic’s name and a booklet that displayed the Vortic logo and explained its manufacture and restoration process. The box also included an authentication card with Vortic’s name and serial number, which was signed by the watchmaker. Vortic’s advertisements emphasized the antique and authentic nature of the watch’s parts. In July 2017, Hamilton sued for trademark infringement and counterfeiting. After a bench trial, the court ruled in favor of Vortic, finding that there was no likelihood of customer confusion. Hamilton appealed, and the court of appeals affirmed the lower court’s ruling. The court of appeals pointed out that Vortic took genuine parts from Hamilton watches, refurbished and repaired them, and modified them into a wristwatch and that consumers would view the watch as an antique pocket watch modified into a wristwatch rather than as an entirely new product. Further, the court of appeals explained that Vortic took many steps to disclose that it was not affiliated with Hamilton and that its watch used refurbished original parts. This could be seen in advertisements, the marks on the watch itself, and the fact that the watches themselves are presented to consumers as restored antique pocket watch parts modified into a wristwatch. The court of appeals contrasted this with other cases (including cases brought by Rolex) where there was no disclosure of the changes made to the watch and pointed out that there was no evidence of consumer confusion in the record. So, What Is Permitted? Anyone seeking to reuse a previously manufactured product or parts from a previously manufactured product should make sure to disclose to consumers exactly what has been done. Further, it is important to make clear that there is no affiliation between the upcycler/customizer and the original manufacturer. These seem to be the key differences between the Rolex decision and the Vortic decision. However, strict compliance with those requirements does not mean that reusing a previously manufactured product cannot give rise to a claim for trademark infringement. One thing that does seem settled is that customization of a product purchased by a consumer is permitted so long as the customized product is intended for the consumer’s own use and not for resale (in the BeckerTime case, it appears that BeckerTime was customizing watches for sale, rather than in response to consumer requests). If you are contemplating reusing someone else’s products or are concerned that a third party reusing your products will result in consumer confusion, please feel free to contact me.
February 14, 2024
Intellectual Property
Laughing in the Face of Copyright: The Unsettling Case of AI-Generated Comedy and Digital Immortality
George Carlin had quite the career. His seven dirty words routine was the centerpiece of litigation about the government’s power to censor indecent material on the airwaves that went up to the Supreme Court. He won awards for his comedy specials and albums (full disclosure: Jammin’ in New York is a personal favorite). He appeared in movies like The Prince of Tides, Bill & Ted’s Excellent Adventure, Cars (where he voiced Fillmore), and was the conductor on Shining Time Station. Carlin passed away in 2008, and he is now at the center of a new lawsuit raising questions about whether AI should be used to “resurrect” deceased artists, who controls the legacy of deceased artists, and who can profit from their “resurrection.” On January 9, 2024, Dudesy LLC (“Dudesy”) released an hour-long video entitled “George Carlin: I’m Glad I’m Dead (2024). The introductory voiceover explained that Dudesy, using some type of AI, fed George Carlin’s standup routines into the training database for the AI; the AI was then used to create the video. The introductory voice further stated, “I listened to all of George Carlin’s material and did my best to imitate his voice, cadence, and attitude, as well as the subject matter I think would have interested him today.” The video quickly made the rounds on social media. By January 25, Carlin’s estate, which had nothing to do with the video, filed suit against Dudesy and the individuals associated with the making of the video. The lawsuit, filed in federal district court in Los Angeles, asserts three claims: violation of the common law right of publicity, violation of the statutory right of publicity, and copyright infringement. The first two claims are based on the unauthorized use of Carlin’s name, voice, and likeness in the video. The third claim is based on the copying allegedly occurring when Carlin’s standup routines were fed into the AI to create the video. The lawsuit claims that Dudesy saw the video as a profit center, not just a way to make people laugh. Dudesy promoted the video with social media posts providing links to its online store and Patreon page from which subscribers can purchase monthly subscriptions. And a YouTube channel associated with Dudesy that posted videos relating to the hour-long special with the same hyperlinks and advertisements. Further, in anticipation of a likely claim that the video was a “fair use,” the lawsuit alleges that the video “has no comedic or creative value absent its self-proclaimed connection with George Carlin. It does not, for example, satirize Carlin as a performer or offer an independent critique of society.” In the wake of the filing of the lawsuit, Dudesy now claims that the video was not written by AI but instead by Chad Kultgen. Mr. Kultgen, together with Will Sasso, hosts the Dudesy podcast—a podcast that was used to promote the video. If it is true that a human wrote the script for the video, that might negate the copyright infringement claim insofar as it relates to the use of AI, but it still leaves Dudesy facing the California right of publicity claims for their efforts to “resurrect” George Carlin. The question of who, if anyone, has the right to “resurrect” a performer or personality depends on state law; slightly less than half of the states recognize a post-mortem right of publicity. The case neatly crystallizes the issues surrounding AI as it impacts the legacies of performers and other celebrities and touches on similar issues that were at the core of last year’s Hollywood strikes. Thirty years after it came out, the movie Jurassic Park remains prescient. And Dr. Malcom’s indictment of John Hammond and InGen applies with equal force to the burgeoning use of AI: “your scientists were so preoccupied with whether or not they could that they didn’t stop to think if they should.” If you need to talk with someone about whether or not you should, contact me or one of my intellectual property colleagues at Offit Kurman.
February 7, 2024
Intellectual Property
Recipes, Trademarks and Décor
Feasting on the Lessons of Il Mulino’s Intellectual Property Battle When thinking about restaurants, most people think of a savory meal in a pleasant setting. I think about that, too, but more often than not, my thoughts turn to a restaurant’s intellectual property and what can be protected (a danger of the trade, I suppose). Restaurant names can be protected as trademarks, recipes as trade secrets, and the plating of an entrée may be protected by a design patent. A recent case involving the well-known Italian restaurant Il Mulino touches on many of these aspects of protection. Still, perhaps most interestingly, that case found that the look of the restaurant’s interior, its trade dress, is protectable. According to the court, this case is the latest in a long-running dispute over intellectual property relating to the Il Mulino restaurants. Defendants had been involved in opening and operating Il Mulino restaurants, an enterprise that involved various entities; one entity owned the intellectual property and licensed it to various locations. In 2020, some of the Il Mulino entities filed for bankruptcy. As a result of the bankruptcy, plaintiffs acquired those entities, including the entity that owned the intellectual property. The defendants opened Il Mulino Tribeca in 2018, and the location closed in September 2023. On September 15, 2023, the defendants opened a new Italian restaurant in the same space as Il Mulino Tribeca. The lawsuit was filed in November, with plaintiffs seeking to preliminarily enjoin the defendants from using proprietary recipes, certain restaurant names, the trade dress of Il Mulino Tribeca, a former Il Mulino location, and certain property from Il Mulino Tribeca in their new restaurant. Each claim warrants review, particularly the trade dress claim. The Trade Dress of Il Mulino Tribeca The court explained that the Plaintiffs defined the trade dress of Il Mulino Tribeca as consisting of the following elements: an art collection of black and white photographs arranged in a perfectly symmetrical design, covering almost one entire interior wall of the restaurant; custom artwork commissioned for Il Mulino Tribeca’s back wall that evokes the restaurant’s Tribeca home by referring to its location “Below Canal St[reet]”; (3) white-washed brick and high ceilings painted matte black; and unique, hand-blown glass pendants hanging near the entrance of the restaurant. All of the above appear in the Defendants’ new restaurant. The court found that the above definition was sufficiently precise and that the claimed trade dress was not functional. According to the court, “Il Mulino Tribeca’s décor plainly does not affect a customer’s “use or purpose” of the restaurant nor the cost or quality thereof. A customer could just as easily enjoy veal parmigiana in the absence of glass pendants or white-washed brick.” The court also pointed out that the trade dress analysis focuses on the trade dress as a whole, not particular elements that may be used by competitors. Finding that the trade dress was also inherently distinctive since it did not convey any information about the restaurant’s services or cuisine, the court concluded that the claimed trade dress was entitled to protection. Since the trade dress was entitled to protection, the court next determined whether there was a likelihood of consumer confusion. The court found that there was a likelihood of confusion even though the claimed trade dress was weak because there was little evidence that consumers associated the trade dress with Il Mulino. In reaching its finding, the court pointed out that the trade dress in the two restaurants was very similar (not surprising since the new restaurant opened in the exact location as the old restaurant and since social media posts for the new restaurant used images that seemed to draw on social media posts for Il Mulino Tribeca); that both restaurants were Italian; and that defendants seemed to be trying to capitalize on the reputation of Il Mulino. On that basis, the court found a likelihood of consumer confusion and preliminarily enjoined the defendants’ use of the claimed trade dress. Infringement of the IL MULINO Trademark The plaintiffs did not fare so well on their other claims. They claimed that the new restaurant’s name, Il Giglio, infringed on the IL MULINO trademark. Apparently, a prior restaurant affiliated with Il Mulino had operated under the name Il Giglio, but the court did not think consumers would associate the new Il Giglio with the old one. Likewise, the court pointed out that Il Mulino and the new Il Giglio used different fonts for their names and that “Mulino” and “Giglio” sound different and have different meanings. Proprietary Recipes The court seemed prepared to protect any of the plaintiffs’ proprietary recipes that the defendants might be using. However, in the court’s eyes, plaintiffs did not present sufficient evidence that the defendants were doing so—the claims were based mostly on the review of a menu and photos of similar-looking preparations of entrees. The court pointed out that neither party presented witnesses at the preliminary injunction hearing, and the plaintiffs did not seek expedited discovery before moving for a preliminary injunction. As a result, the evidence relating to the improper use of the plaintiffs’ proprietary recipes was insufficient. Interestingly, the court raised the possibility of a confusion-based theory as to the plating of dishes (particularly Il Mulino’s branzino) but did not pursue it since plaintiffs failed to develop it. Personal Property Finally, the court declined to enjoin the defendants’ use of certain personal property allegedly belonging to plaintiffs, such as tableware and tens of thousands of dollars of alcohol. According to the court, this personal property was not part of the trade dress, and plaintiffs could be compensated for the use of this property if its use was not enjoined. The court’s decision is a good example of the many different types of intellectual property a restaurant may have and how willing a court will be to protect that intellectual property. If you have questions about protecting your restaurant’s intellectual property or about someone who might be using your restaurant’s intellectual property without authorization, contact me or one of my intellectual property colleagues at Offit Kurman.
February 2, 2024
Intellectual Property
Decorating Danger: Pitfalls in Using Images of Rooms Decorated with Your Furnishings
Everyone does it. A light fixture is featured in a prestigious publication, or a rug is shown in a home featured by an interior design publication. The image (and perhaps an image of the publication’s cover) is quickly reposted on Instagram, added to the company’s website, placed in promotional materials, and otherwise used to promote sales. There’s just one problem. Use of the image could result in costly charges of copyright infringement. Copyright Ownership: Under U.S. law, the general rule is that the author of a work owns the copyright in the work unless the work was created within the scope of their employment, in which case their employer owns the work. In most cases, the photographers working for publications like Interior Design, Architectural Digest, House Beautiful, or Coastal Living are not employees but independent contractors, which means that the photographers, and not the publications, own the copyright in the photos they take and the photos shown by the publications. As a result, the photographer (not the publication) must give permission for any reproduction of their photo, including reproductions on social media or websites. Photographers, not publications, generally own the copyright in photos featured in prestigious publications. Reproduction requires explicit permission from the photographer, extending to social media and websites. Strict Liability in Copyright Infringement: Reproduction without permission is copyright infringement. Copyright infringement is a strict liability offense, meaning there is no defense to whether infringement occurred — either something was copied without permission, or it was not. There are defenses that can be asserted , but these are directed to the amount of damages, not whether there has been infringement. Giving credit to the photographer or the publication is not a defense. Similarly, the fact the one didn’t make any money directly from the use of the photo is not a defense. The fact that an image was available online is generally not a defense. Nor is a court likely to find that such a use is a fair use — to find out if a use is fair use (essentially arguing that no permission was needed), it will probably be necessary to take the case to trial, involving expense in terms of time and money. Costs of Copyright Infringement: If a photographer has timely secured a copyright registration for their photos, they are entitled to statutory damages of up to $30,000 per infringement (and up to $150,000 per infringement if the infringement is shown to be willful). The idea of such an award is to deter future infringement. In addition, the photographer is entitled to their reasonable attorney’s fees if a timely copyright registration was made. Reproducing images without permission can lead to costly consequences. Photographers with timely copyright registration can seek damages up to $30,000 per infringement or $150,000 if willful, plus attorney’s fees. Importance of Written Permission: Having permission from the photographer would defeat a claim of copyright infringement, but that permission should be directly from the photographer and should be in writing. Permission from the publication in which the photo appears is probably not enough unless the magazine owns the copyright in the photos. Reality Check — Cease and Desist Letters: Think it can’t happen? It has already happened and will happen again. Entities you know have received cease and desist letters from photographers. Others have been sued (roughly half of the copyright infringement lawsuits filed in the U.S. involve the unauthorized use of a photograph). In either case, payment has likely been made, and either a license permitting the images to stay up has been obtained or the images have been removed. Entities have received cease and desist letters and faced lawsuits for unauthorized photo use. Roughly half of U.S. copyright infringement cases involve unauthorized photo use, resulting in payments and image removal. Protection Against Claims: The best way to protect against a copyright infringement claim is to make sure you have permission to use the photo showing your product or the room you designed or styled (if possible, take the picture yourself!). If a photographer refuses to give you permission, don’t use the image. If you are not sure if you need permission or have permission, contact me or one of my intellectual property colleagues at Offit Kurman — an ounce of prevention is worth a pound of cure.
January 24, 2024
Intellectual Property
Trademarks in Your Cereal Bowl
A Closer Look at Post’s Fruity Pebbles Trademark Application It’s likely that you, your kids, or your grandchildren have eaten them. Have you ever thought, though, that you could identify what you are eating just by the fact that multicolor rice crisps are in your bowl? It’s probably not the first thing you think of while you are eating, paying more attention to their crunch and the sound they make when they are in milk. We’re talking about Post’s Fruity Pebbles cereal, of course. While you may not have been thinking that you could identify the contents of your bowl just by looking at the colors in it, Post Foods LLC (“Post”) was thinking that. Thus, Post filed a U.S. trademark application to register the colors of Fruity Pebbles as a trademark for use in connection with breakfast cereals. Interestingly, that application was initially refused, and that refusal was affirmed in a decision issued by the Trademark Trial and Appeal Board on January 4, 2024. There were two main reasons for the refusal. First, in its application, Post defined the mark as “consist[ing] of the colors of yellow, green, light blue, purple, orange, red and pink applied to the entire surface of crisp cereal pieces,” as shown in the image below (the application did not claim the shape of the cereal crisps, which makes sense since each crisp has a different shape). However, the application sought registration of the claimed mark (the colors) for use in connection with breakfast cereals, not crisp cereal pieces or breakfast cereals consisting of crisp cereal pieces. Post argued that it sought registration of the colors shown in the drawing as applied to crisp rice cereal pieces. Ultimately, the Trademark Office held that the mark that Post sought to register was the combination of colors as applied to breakfast cereals. This was because the shape of the rice crisps was not claimed as part of the mark and because the application identified the goods as breakfast cereals (which could cover cereals in ring-like shapes as well as cereals shaped like rice crisps). Having determined what mark Post sought to register, the Trademark Office next considered whether the mark was registrable. The Trademark Office concluded that the claimed mark did not function as a source identifier and, thus, that it was not registrable. Why did the Trademark Office reach that conclusion? It was not because the claimed mark consisted of colors—the Trademark Office has long recognized that colors can be trademarks. Rather, it was because, in the Trademark Office’s view, Post had not come forward with sufficient evidence to show that consumers associated the colors used for Fruity Pebbles with breakfast cereals. The evidence showed that a wide variety of breakfast cereals had similar multicolor cereal combinations. Some were for other crisp rice cereals, and some featured diverse shapes. The Trademark Office referenced Fruit Loops; Cap’n Crunch’s OOPS! All Berries corn and oat cereal; Trix Fruity Shapes cereal; Trader Joe’s Fruity O’s cereal; Best Choice Fruity Crisp Rice cereal; Wegmans Fruity Rice Crisps cereal; Clover Valley Fruity Bites rice cereal and others to support this conclusion, as well as articles from various publications. With so many cereals using multicolor combinations, in the Trademark Office’s view, the use of a similar combination on Fruity Pebbles would not cause consumers to identify the cereal as being Fruity Pebbles. Additionally, the Trademark Office pointed out that much of the evidence submitted by Post to support its application pertained to its use of the multicolor combination on crisp rice breakfast cereals, not to the broader breakfast cereals identified in the application. In view of this decision, anyone interested in registering a trademark in the U.S. should keep the following in mind: In the U.S., it is possible to register colors and product configurations as trademarks (it is much more difficult to do this elsewhere in the world); While colors and product configurations can be registered as trademarks in the U.S., it is not an easy thing to do and often requires the submission of extensive evidence showing that consumers recognize the mark; and The advice of experienced trademark counsel is crucial in prosecuting applications like this, from identifying the goods to be covered by an application to assessing whether there is sufficient evidence to establish that a mark functions as a source identifier. At Offit Kurman, we can assist with all aspects of trademark prosecution; please reach out for a consultation or if you have any questions.
January 17, 2024
Intellectual Property
Behind the Headlines: Understanding the Nuances of Mickey Mouse's Public Domain Status
Public Domain Day is a relatively new celebratory event observed on January 1. The purpose of this day is to celebrate the entry of works that were protected by copyright into the public domain. Before Public Domain Day, articles routinely appear reporting on the works entering the public domain name. In recent years, works entering the public domain have included The Great Gatsby (which became the basis for a musical that is likely heading to Broadway), The Jazz Singer, Metropolis, and Winnie-the-Pooh. Before this year's Public Domain Day, articles heralded Mickey Mouse entering the public domain. The implication, of course, is that Mickey Mouse will thus be free for everyone to use — after all, isn't that what it means when something enters the public domain? Not necessarily. Mickey Mouse is not necessarily entering the public domain, but his first appearances in two shorts, Steamboat Willie and Plane Crazy, are. Anyone wanting to use Steamboat Willie or Plane Crazy is free to do so. Either (or both) can be shown without permission from or the need to pay royalties to Disney. The same may be true of the version of Mickey Mouse shown in Steamboat Willie and Plane Crazy. That version of Mickey Mouse is in black and white, does not speak, and does not wear red pants. However, like many other well-known characters (Sherlock Holmes and James Bond, for example), Mickey Mouse has changed over time and has traits and characteristics that are still protected by copyright; only the earliest works featuring Mickey Mouse are now in the public domain. So, Mickey Mouse, as he appeared in Fantasia, is still off-limits. This is why the trailer for the recently announced slasher film Mickey's Mouse Trap uses the Steamboat Wille version of Mickey Mouse as its villain. The survival horror game Infestation: Origin also features the Steamboat Wille version of Mickey Mouse as its villain. That version of Mickey Mouse also appears set to be the villain in another recently announced untitled horror film. There is another reason Mickey Mouse is not free for everyone to use. Mickey Mouse is undeniably a symbol of Disney, and a consumer seeing goods or services being offered in conjunction with Mickey Mouse is likely to believe that those goods or services are associated with or endorsed by Disney. In other words, Mickey Mouse functions as a trademark. Indeed, Disney has multiple trademark registrations for Mickey Mouse (and for Minnie, Goofy, Pluto, Donald, and many other characters), and any effort to use Mickey Mouse to indicate the source of a product or service will likely be met with a claim of trademark infringement. Moreover, Walt Disney Animation Studio adopted a clip from Steamboat Willie as its logo, strengthening its ability to claim the early version of Mickey Mouse as a trademark. Practical considerations will also limit the availability of Mickey Mouse. Disney is no stranger to litigation and is positioned to impose significant costs on anyone it believes is using more of Mickey Mouse than they are entitled to use. In fact, Disney may very well seek out cases to litigate to concretely establish the scope of its rights in Mickey Mouse (the estate of Sir Arthur Conan Doyle did this with respect to Sherlock Holmes, resulting in a ruling in 2014 that at the time, certain of Holmes' characteristics are in the public domain and that certain of his characteristics are not). So, while we can celebrate the entry of Steamboat Willie and Plane Crazy into the public domain, one shouldn't assume that Mickey Mouse is likewise now in the public domain. The only sure thing to come from such an assumption is litigation, as it has been reported that Disney has announced its intention to continue to protect its rights. If you have any questions about using Steamboat Willie, Plane Crazy, or any other work that is in the public domain, reach out to Offit Kurman's intellectual property group for a consultation.
January 9, 2024
Intellectual Property
Are You Properly Licensed to Sing “Happy Birthday”?
Originally posted on 02/20/20, content updated on 11/17/23 It can’t possibly be illegal to sing “Happy Birthday”… can it? We sing “Happy Birthday” about as often as we mow the lawn, fill up the car with gas, or go to the grocery store. Until recently, however, we may have been doing so illegally, depending on the circumstances. It’s easy to forget (if one ever was even aware in the first place!) that someone first wrote a tune and that intellectual property rights might extend to something as basic as “Happy Birthday.” Particularly egregious violations of such IP rights [note tongue firmly in cheek!] might include summer campfire renditions, or worse, heaven forbid (!), posting a YouTube video in blatant disregard for such legally protected rights. Fear not! (well, fearless, at least…) As a result of a major lawsuit involving the copyright’s claimed owner at the time, Warner/Chappell Music, the Happy Birthday tune, written in 1893 by Patty Smith Hill and her sister Mildred J. Hill (originally titled “Good Morning to All”) is now in the “public domain.” Additionally, after the American Society of Composers, Authors and Publishers (ASCAP) threatened years ago to sue the Girl Scouts, among others, the American Camp Association (ACA) and ASCAP reached an understanding costing the ACA thousands of dollars a year to assure legal campfire singing of copyrighted music – the ACA licenses all of ASCAP’s licensed music for all ACA-accredited camps! [Legal disclaimer: Posting a video of your little campfire girl performing even an ACA/ASCAP-licensed tune requires its own special license (available through ASCAP’s Internet Licensing Dept – for a small fee, naturally!). Also, stage production music is licensed by MTI, an entirely separate entity (with no blanket camp licensing deal in place!).]
November 17, 2023
Intellectual Property
From Palette to Protection: When Does Color Function as a Trademark?
Back when my daughter was in third grade, parents were invited to her classroom to talk about their jobs. I talked about trademarks and brands, discussing products they would appreciate, like HOT WHEELS miniature cars and AMERICAN GIRL dolls. At one point, I told the students that a color can be a trademark and that Mattel claims the right to the color pink as a trademark associated with their BARBIE products. A little girl named Emma spoke up and said, “That doesn’t seem fair that just one company can use a color.” What Emma didn’t know was that she isolated the same issue that the US Supreme Court had considered back in the 1990s when the Court held, in a case involving green-gold dry cleaning machine pads, that a company could claim color as a trademark, but only after years of exclusive use and evidence that the public associates the color with a single source. (By the way, Emma is now in law school.) So what does it take to be able to claim that a color is exclusively for use by one source? First, to be clear, even when a company is able to claim color as a trademark, its rights will only be limited to the goods or services for which the color is used or closely related goods/services. So while Tiffany could stop another jewelry company from using its robin’s-egg blue color, Tiffany would not be able to prevent, say, an HVAC installation company from using this shade. To be eligible for trademark protection, a color must be: Non-functional: The color should not serve a functional purpose related to the product or service. In other words, it should be purely aesthetic. Recognized by the public: The color must have gained recognition and distinctiveness in the minds of consumers. Examples in Advertising: UPS’s Iconic Brown One of the most famous examples of a company successfully using color as a trademark is United Parcel Service (UPS). Instant Recognition: UPS’s brown delivery trucks are instantly recognizable, and the color has become synonymous with the brand’s reliable package delivery services. Consistent Branding: UPS consistently uses brown in its advertising, packaging, and uniforms. This uniformity reinforces the brand’s image and helps it stand out in a crowded market. Promotional Campaigns: “What Can Brown Do For You?” UPS has run advertising campaigns centered around its brown color, emphasizing the reliability and trustworthiness associated with the color brown. Challenges and Legal Considerations While companies like UPS have successfully used color as a trademark, it’s important to note that securing trademark protection for a color can be challenging. Courts often require extensive evidence of distinctiveness and consumer recognition. Additionally, competitors may challenge the validity of color trademarks, arguing that the color is functional or not sufficiently distinctive. Conclusion Color can be a powerful tool for branding and marketing, and some companies, like UPS, have effectively incorporated it into their trademark strategy. However, the legal requirements for securing and defending a color trademark are rigorous. Businesses considering color as a trademark should seek legal counsel to navigate the complexities of trademark law and protect their unique brand identity. If you would like to discuss trademark protection for colors, please reach out to me.
September 26, 2023
Intellectual Property
Trade Dress at a Glance: Protecting the Look and Feel of a Product
When safeguarding their consumer reputation, most companies recognize the value in their brand names, logos, slogans, and their associated goodwill and the importance of protecting those assets. However, many neglect to protect their trade dress: the look and feel of a company’s product, packaging, or services. Trade dress can be a powerful source-identifying tool: rather than protecting a specific name or logo, trade dress is about the “overall design and appearance” of a product. It can include elements that may not be protectable on their own. Nora Beverages, Inc. v. Perrier Group of Am., Inc., 269 F.3d 114, 118 (2d Cir. 2001). Trade dress can come in many forms, and courts have upheld trade dress protection in colors, store layouts, and website designs. The U.S. Supreme Court recently referenced trade dress as part of its discussion on whether elements of a dog squeaky toy infringed on several Jack Daniel’s trademarks — including their styled white filigree and distinctive square bottle. More on that decision and its implications on First Amendment protections can be found in our previous client alert here. This article focuses instead on how companies can incorporate trade dress protections into their intellectual property portfolio. The Elements of Trade Dress To qualify as a protectable trade dress, the product packaging or design must meet two main criteria: it must be inherently distinctive (or have acquired a secondary meaning that makes it source-identifying) and be nonfunctional. “Distinctiveness” can be a nebulous term, and courts consider the distinctiveness of product design and packaging differently. The Supreme Court has held that a product’s design is not inherently distinctive without acquiring secondary meaning that ties it to a brand. Wal-Mart Stores, Inc. v. Samara Bros., 529 U.S. 205, 212 (2000). A product’s packaging, however, or the overall design elements of a restaurant or retail store (which the Court viewed as being more akin to packaging than product), can be inherently distinctive. In instances where an element of package design is particularly unique or fanciful or when several commonplace elements are taken together to make a whole, trade dress may lead a consumer to associate it with a particular company or brand. Some packaging design elements are distinctive enough to qualify as protectable trade dress in their own right. One of the most famous examples is the design of a glass bottle of Coca-Cola; without any additional labeling or context, the average consumer can immediately identify the brand behind it and the product contained within it. Some characteristics, like specific colors, may not be inherently distinctive at their outset but can acquire a secondary meaning through their use — such as Tiffany & Co.’s distinct blue box. Trade dress looks at the entirety of a design. Even commonplace elements without a solid secondary meaning, such as the examples above, can be part of a distinctive trade dress. Grouped together, such elements can form a unique whole, and the more elements used to establish the overall look and feel, the more likely a trade dress is to be protected. For example: in 2013, Apple was able to secure protection for its retail locations’ overall look and feel. Taking the elements of their store design as a whole, Apple conveyed an overall image that was distinct and identified their brand. In some cases, a trademark registered and protected in its own right gained more robust protection through its incorporation into trade dress. In Gucci Am., Inc. v. Guess?, Inc., 868 F. Supp. 2d 207, 248 (S.D.N.Y. 2012), Guess was found not to have infringed on one of Gucci’s trademarked logos with their similar mark, but the Court found that when the logos were both used in a similar brown-on-beige product design, it was a step too far. Non-functionality is the other essential element of trade dress. Functionality, in this case, covers elements necessary for product use and those that affect cost or quality. When the features that make the product useable and the aesthetic elements that allow a customer to identify the source are one and the same, courts are reluctant to classify those features as trade dress. Visually distinct components that are also protected by a utility patent, for example, are generally not protected as trade dress. TrafFix Devices, Inc. v. Mktg. Displays, Inc., 532 U.S. 23, 29 (2001). However, the inclusion of functional elements in a trade dress does not necessarily render it unprotected. The hands and dial of a watch are undoubtedly useful, but their aesthetic qualities are trade dress. Cartier, Inc. v. Sardell Jewelry, Inc., 294 F. App’x 615 (2d Cir. 2008). A functional aspect that incidentally creates a distinctive feature (such as a decorative embossment made by a patented process) can also be protected trade dress. McAirlaids, Inc. v. Kimberly-Clark Corp., 756 F.3d 307, 312 (4th Cir. 2014). Taking Appropriate Action Trade dress is protected by federal law, and companies concerned that a competing product is imitating the look and feel of their trade dress can sue under the Lanham Act. Although it is possible to protect trade dress without registering it with the U.S. Patent and Trademark Office first, an ounce of prevention is worth a pound of cure. Taking the proactive step of registering a trade dress makes it easier for companies to enforce their rights: for example, 15 U.S.C.A. § 1125(a)(3) states that a person who seeks to protect an unregistered trade dress has the burden of proving the elements they wish to protect are nonfunctional. Registering their trade dress on the principal register can save a company that burden. Companies, particularly the design and marketing departments, should consult with their trademark attorneys early in product development to avoid unintended infringement pitfalls in their products and packaging and to determine if registering their trade dress is practical and serves their specific needs. This summary of legal issues is published for informational purposes only. It does not dispense legal advice or create an attorney-client relationship with those who read it. Readers should obtain professional legal advice before taking any legal action.
July 20, 2023
Intellectual Property
Supreme Court Limits First Amendment Protection in Trademark Parody Case
Decision Jack Daniel’s Properties, Inc. v. VIP Products LLC, No. 22-148 (U.S. 2023). This month, the Supreme Court clarified the interplay between the First Amendment’s protection of freedom of expression and the Lanham Act’s protection against trademark infringement in a case that dealt with a manufacturer of dog toys modeled off of famous liquor bottles. In Jack Daniel's Properties, Inc. v. V.I.P. Products L.L.C., No. 22-148 (U.S. 2023), the Supreme Court ultimately held that when analyzing the propriety of the use of another's trademark, the critical question is whether the trademark is being used for "source identification"—i.e., to communicate the maker, manufacturer, or creator of the work in question. If so, then there is no threshold First Amendment inquiry and an infringement claim can proceed as usual, regardless of whether the use of the trademark had been intended as a parody. Background of Case Jack Daniel's is a case about "dog toys and whiskey," Justice Kagan writes in the very first sentence of the Court's opinion. The dispute began when V.I.P. Products began manufacturing a dog toy primarily modeled after the famous Jack Daniel's Whiskey bottle called "Bad Spaniels." Although the toy largely borrowed the trappings of the iconic Jack Daniel's bottle and label, it altered the words "Jack Daniel's" to "Bad Spaniels," "40% ALC. BY VOL" to "43 percent poo," and "Old No. 7 Brand Tennessee Sour Mash Whiskey" to "Old No. 2 On Your Tennessee Carpet." The toy also disclaimed that it was "not affiliated with Jack Daniel's Distillery." Shortly after the Bad Spaniels chew toy hit the market, Jack Daniels demanded V.I.P. cease its sale. Rather than comply, V.I.P. sought a declaratory judgment in the District Court of Arizona, asserting: (a) it was protected from an infringement claim under the First Amendment according to the test set out for artistic works in Rogers v. Grimaldi, 875 F.2d 994 (2d Cir. 1989) (adopting a two-pronged threshold test for the Lanham Act to apply: (1) determining whether use has "artistic relevance"; and (2) if so, whether the use is "explicitly misleading" as to the source or content of the work); and (b) it was protected from a dilution claim because the toy was a parody and qualified as fair use under 15 U.S.C. § 1125(c)(3)(A). Jack Daniel's countersued, asserting trademark infringement (based on consumer confusion) and dilution. Lower Court Decisions At first, the District Court rejected V.I.P.'s arguments. It held that because the use of Jack Daniel's trademark identified the alleged source of V.I.P.'s product, First Amendment protections did not apply. The district court also refused the parody defense to dilution for essentially the same reason—i.e., the exclusion did not apply when the use of the mark identified the source of the alleged diluter's product. After a bench trial, the district court found “consumers were likely to be confused about the source of the Bad Spaniels toy and that the toy’s negative associations with dog excrement (e.g., “The Old No. 2”) would harm Jack Daniel’s reputation.” The Ninth Circuit reversed. The appellate Court determined the threshold First Amendment Rogers test did apply "because Bad Spaniels is an expressive work" and "communicates a humorous message." In addition to remanding the case on the infringement claim, the Court of Appeals also rejected the dilution claim, reasoning that since the work "parodies and comments humorously on Jack Daniel's," it was protected under the "exclusion for noncommercial use" per 15 U.S.C. § 1125(c)(3)(C). On remand, the District Court applied the Ninth Circuit’s analysis and granted summary judgment in favor of V.I.P. on the infringement claim. After the Ninth Circuit affirmed the second judgment, the Supreme Court accepted Jack Daniel's appeal on the infringement and dilution claims. The Supreme Court’s Decision Reversing and remanding, the Supreme Court largely agreed with the District Court's original analysis. Generally, it held that the threshold First Amendment Rogers test does not apply when someone uses a trademark as a trademark—that is, to identify the source of a product. In so doing, the Court provided several examples to help explain when trademark use is source-identifying versus when it is used to convey another expressive function. For example, the band Aqua's use of Mattel's trademark "Barbie” in the song "Barbie Girl" did not speak to the song's origin but was used to promote a message of positive body image. Another example is the use of "Louis Vuitton" in the film The Hangover: Part II, where a character uses the mark to describe his luggage but mispronounces the name. The use was to convey something about the character – he wants to be seen with the luxury brand but doesn't know how to pronounce its name. These marks were not used to identify the source of the goods but to perform another expressive function, and the Rogers test would apply. On the other hand, when the use "at least in part [is] for source identification," as here where V.I.P. has used trademarks and trade dress derived from Jack Daniel's registrations as a designation of the source to promote its products, then the First Amendment Rogers does not apply because the "defendant may be trading on the goodwill of the trademark owner." For similar reasons, the Court also rejected the Ninth Circuit's decision about the noncommercial exclusion to dilution for "parody" and "fair use." Ultimately, the Court held that neither the First Amendment nor the “noncommercial exclusion” exception to liability applied. Thus, the lawsuit was remanded for further proceedings. Key Takeaways Brand owners have kept a close watch on Jack Daniels, as many were concerned that the Court would significantly expand the immunizing power of parody and humor in trademark infringement cases, allowing a potential infringer to dodge litigation by invoking Rogers. The Court's decision quells those fears. By drawing a clear line under the applicability of the Rogers test in disputes involving trademarks that contain expressive elements, the Court upheld the central ten-ant of trademark law: those using a mark that is similar to or evokes another's trademark as a source identifier to promote its goods or services will be subject to the likelihood of confusion inquiry under the Lanham Act, even if the use is in parody or overtly humorous. The First Amendment considerations do not create a safe harbor for those who trade on the goodwill of another's trademark to gain an advantage. To be clear, the Court's holding does not eviscerate the role of parody. Jack Daniel's only makes the Rogers test unavailable as an escape hatch to achieve a summary dismissal of the infringement action. Satire remains a viable defense in the context of a standard likelihood of confusion inquiry. As the Court noted, "a parody is not often likely to create confusion. Self-deprecation is one thing; self-mockery, far less ordinary." In sum, Jack Daniels refocuses the inquiry on the likelihood of consumer confusion. Companies are encouraged to consider these considerations as they evaluate new trademarks or trade dress during product and brand development. This summary of legal issues is published for informational purposes only. It does not dispense legal advice or create an attorney-client relationship with those who read it. Readers should obtain professional legal advice before taking any legal action.
June 23, 2023
Intellectual Property
Chew on This – SCOTUS Rules that Dog Toy Parodying Jack Daniel’s Can’t Hide Behind First Amendment
On June 8, the US Supreme Court ruled unanimously in favor of Jack Daniel’s in Jack Daniel’s Properties, Inc. v. VIP Products LLC, overturning the decision of the 9th Circuit Court of Appeals. Justice Elena Kagan wrote the opinion, holding that VIP Products’ sale of a dog chew toy in the shape of a Jack Daniel’s bottle, which also has a label replacing “Jack Daniel’s” with “Bad Spaniels” and other parodying of the Jack Daniel’s label in a manner referring to dog defecation, was not sufficiently protected under the First Amendment to avoid liability for trademark infringement or dilution. The SCOTUS decision was not a complete victory for Jack Daniel’s. Having held that the “Bad Spaniel’s” chew toy was not protected from claims of trademark infringement and dilution, Justice Kagan sent the case back down to the US District Court for a determination of whether there is a likelihood of confusion and whether “Bad Spaniels” dilutes Jack Daniel’s trademarks. VIP Products’ position was that its “Bad Spaniels” chew toy was an expressive work that conveyed a humorous message and that, therefore, the First Amendment protects the use from a claim of trademark infringement. However, VIP Products had also claimed that “Bad Spaniels” and other parodying elements were trademarks owned by VIP Products. This contributed to VIP Products’ downfall: because VIP Products was using “a trademark to designate the source of its own goods—in other words, … used a trademark as a trademark,” as Justice Kagan put it, VIP Products was not entitled to special First Amendment protection. In making this ruling, Justice Kagan made a point of saying more than once that the parody aspect of the “Bad Spaniels” toy could factor into an analysis of the likelihood of confusion. In other words, where such content is a parody, consumers are less likely to be confused into thinking that the parodic products come from the same source as the product being parodied. SCOTUS also knocked down the 9th Circuit’s holding that there was no trademark dilution. Under federal trademark dilution law, owners of famous trademarks can sue users of identical and very similar trademarks even where there is no likelihood of confusion. The 9th Circuit said VIP Products’ use was “noncommercial” because it was a parody and conveyed a humorous message. Justice Kagan disagreed, finding that the 9th Circuit’s view was too expansive and noting that there are limitations in the dilution law where the parodying content is used as a source identifier of the accused product. What can we take away from this decision? This is by no means an absolute bar on selling items that may constitute a parody of a brand, even a famous one. However, creators of such products would do well to avoid treating the parodying elements as trademarks and avoid any content or action that could mislead the public into thinking there is a source connection between the parodied product and the parodying one.
June 13, 2023
Intellectual Property
Does the First Amendment Protect the Use of Parody for Commercial Purposes?
The US Supreme Court Will Decide On March 22, the US Supreme Court will hear arguments in Jack Daniel's Properties, Inc. v. VIP Products LLC. In a case that pits trademark rights against free speech claims, Jack Daniel's has sued VIP Products for trademark infringement due to VIP Products' sale of a dog chew toy in the shape of a Jack Daniel's bottle with a label replacing "Jack Daniel's" with "Bad Spaniels" and engaging in other parodying of the Jack Daniel's label in a manner referring to dog defecation. VIP Products takes the position that its parody should be protected under the First Amendment Freedom of Speech Clause. Jack Daniel's view is that a company selling a commercial product that makes humorous use of the Jack Daniel's brand should not be entitled to First Amendment protection. I discovered in a store in Colorado that "Bad Spaniels" is just one of a line of dog toys parodying liquor brands. Although it may be that Jack Daniel's is the only brand worked up enough about this to bring a lawsuit (and take it all the way to the Supreme Court), several third parties have filed briefs in support of Jack Daniel's position, including Campbell Soup Company, Nike, and several trade associations. The Supreme Court's decision will likely issue in June.
February 23, 2023
Intellectual Property
USPTO Shortens Time for Response to Office Actions
On December 3, 2022, the US Patent and Trademark Office (USPTO) is making a big change to the requirements to respond to rejections or requirements for further information. Background: When a business files an application for trademark registration in the US, it is (eventually) examined, and the examining attorney will either approve the application or issue an Office Action. The Office Action is a letter that will either refuse to accept the application (because of a prior similar registration or other ground for refusal) or require amendments to a part of the application (such as the description of goods) before the application can be accepted. Throughout recorded history, the USPTO has given the applicant six months to respond to the Office Action. Big Change: For Office Actions issued on or after December 3, the USPTO will require a response within three months of the date of issue of the Office Action. It is possible to extend this time for an additional three months with payment of a fee. The fee will need to be paid before the 3-month deadline; it will not be automatic and cannot be paid after the fact. What this means for applicants: Your attorney handling the application will notify you when an Office Action issues and will let you know the deadline to respond or request the extension. It will be important to review the issues with your attorney and make a plan for responding without delay. Additional considerations: For now, this change only applies to Office Actions issued in pending applications. For Office Actions that might issue in response to a post-registration renewal or declaration of use, the same change will take effect on October 7, 2023. For more information about this rule change or any issues related to trademark protection or registration, please contact Laura Winston.
October 17, 2022
Intellectual Property
Defamation: Five Key Questions for Any Potential Claim
Defamation has been in the news lately thanks to the Depp v Heard Trial. But what is defamation exactly? Has someone ever posted an untrue statement about you or your organization online? Untrue statements are published every day but not every untrue statement rises to the level of defamation. Consider the following elements of Defamation: What is defamation? A false, malicious communication of fact to a third-party causing injury to one’s reputation. In Virginia, defamation encompasses libel (written recorded statements) and slander (oral statements). Watch: Spider-Man: The Difference between slander and libel – YouTube What is required to prove defamation? Publication (the statement is seen or heard by a third party); A false statement tending to harm the reputation of another; & The requisite intent. (actual malice for public figures; negligence for nonpublic figures).Gaz, Inc. v. Harris, 325 S.E.2d 713, 725 (Va. 1985). What is a defamatory statement? The statement or communication must be more than an unpleasant statement. The subject of the statement must appear odious, infamous or ridiculous. A statement will not be actionable as defamation unless it has a “sting” injuring the subject’s reputation. However, defamation can be proven by inference, implication or insinuation. Can opinions constitute defamation? No – statements of pure opinion are not defamation. “The First Amendment and the Constitution of Virginia protect the right of every individual to express any opinion or idea, however ill-founded.” Tharpe v. Saunders, 737 S.E.2d 890, 893 (Va. 2013). Note – adding qualifiers such as “in my opinion” will not diffuse an otherwise defamatory statement. How can a statement be published? Any communication by any method to one or more persons who can understand its meaning. Newspaper articles, statements aloud to others, books, Twitter posts, Facebook statements, and other social media mediums. If you or your organization are the subject of a potentially defamatory statement or a defamation lawsuit is threatened against you or your organization, don’t make any decisions about how to proceed before talking with a trusted attorney in your area. Offit Kurman attorneys are available to advise on defamation and other issues. Reach out to Anders Sleight today to discuss your specific situation.
October 6, 2022
Intellectual Property
Trademark Law v. The First Amendment – the Saga Continues
In recent years, the US Supreme Court found that two provisions of the US trademark law that date back to the 1940s were unconstitutional because they violated the free speech provisions of the First Amendment. In Matal v. Tam, it was the law prohibiting registration of disparaging trademarks, and in In re Brunetti, it was the law prohibiting registration of immoral or scandalous trademarks. Now the Court of Appeals for the Federal Circuit has reached a similar conclusion in a less obvious case. In In re Elster, decided on February 24, an attorney applied to register the trademark TRUMP TOO SMALL for “T-shirts.” Registration was refused based on a provision that prohibits trademark registration of a name identifying a particular living individual without that individual’s consent (and another ground not ultimately considered on appeal). Elster appealed to the Trademark Trial and Appeal Board (TTAB), which upheld the refusal. Elster then appealed to the Federal Circuit. The federal government argued that the government interest in protecting state-law privacy and publicity rights outweighed Elster’s First Amendment rights. The court noted that Trump, as a public figure, had no right of privacy-protecting him from criticism in the absence of knowingly publishing false information or doing so with reckless disregard for the truth. The court also said, “The right of publicity does not support a government restriction on the use of a mark because the mark is critical of a public official without his or her consent.” The court ultimately concluded that the free speech provisions of the first amendment outweighed the government interest and that “[t]he statute leaves the [US Patent and Trademark Office] no discretion to exempt trademarks that advance parody, criticism, commentary on matters of public importance, artistic transformation, or any other First Amendment interests. It effectively grants all public figures the power to restrict trademarks constituting First Amendment expression before they occur.” And so the court reversed the TTAB’s decision and found the trademark TRUMP TOO SMALL to be registrable. In reaching its decision, the court made clear that it was not concluding that the relevant section of the trademark law is overbroad, saying it was leaving that question for another day. Rather, it was saying that the application of the law to Elster’s trademark was in violation of his First Amendment rights. Still, this leaves the door open for other trademark applicants for such marks that are parody or critical commentary to raise the overbreadth challenge in the future. Are you considering adoption of a trademark that includes the name of a living individual? For guidance on the evolving state of the law as it applies to your situation, contact Laura Winston at lwinston@offitkurman.com or 347-589-8536.
March 17, 2022
Intellectual Property
New Year, New Trademark Law – Petitions for Expungement and Reexamination of Trademark Registrations
Petitions for Expungement and Reexamination of Trademark Registrations The Trademark Modernization Act took effect on December 18, 2021, and now it is easier and less expensive to cancel unused registered trademarks. Any party can bring an expungement or reexamination proceeding to remove a trademark from the register. An expungement proceeding is when a party believes that a trademark has never been used in commerce. The proceeding must be brought when the registration is between 3 and 10 years old (although until December 27, 2023, the proceeding can be brought against any registration more than three years old). A reexamination proceeding is for when a party believes that a trademark was not in use at the time an application based on use was filed or when use is claimed in an application originally based on intent to use. The proceeding must be brought before the 5th anniversary of the registration. Below are answers to questions some may have about these new proceedings. How do expungement and reexamination differ from a trademark cancellation action? These new, simplified proceedings will be brought before Trademark Examining Attorneys instead of the judges of the Trademark Trial and Appeal Board. A cancellation action, which is similar to a lawsuit in federal court, has discovery, a trial, and the possibility of motions. Expungement and reexamination will be much more streamlined – the petitioner files a petition setting forth the information to demonstrate non-use. The registrant then has the opportunity to file a response including evidence of use or excusable non-use. The Examining Attorney then reaches a decision based on the petition and response. If the Examining Attorney orders that the registration be canceled, the registrant has the opportunity to file a request for reconsideration and appeal. The costs for expungement and reexamination will be considerably lower than a start-to-finish cancellation proceeding. The filing fee for expungement or re-exam is $400 per class of goods or services, which is less than the $600/class fee for a cancellation action. More significantly, the legal costs for handling the proceeding will be significantly less than for a cancellation action. If there’s no discovery, how does the petitioner show that the mark was not used? The petitioner is required to submit the results of a “reasonable investigation.” This will vary based on the goods or services, relevant industry and customary channels of trade for the goods or services. Generally speaking, a thorough use investigation conducted by an experienced private investigator will likely be appropriate Why would I want to file a petition for expungement or reexamination of a third party’s registration? There are various reasons to file for expungement or reexamination, but the most common reason is likely to be that a party wants to adopt a new trademark that cannot be registered because of prior registration. How can I avoid a petition for expungement or reexamination being filed against a trademark registration I own? If you are selling the goods or rendering the services covered by your trademark, it is unlikely that someone will file a petition for expungement or reexamination against your registration. It will be helpful to make sure that you are actively demonstrating your use and showing your products and services on your website and on social media as may be appropriate for your business and industry. If you have any questions about the use of your trademarks, please feel free to contact me. I was able to get my registration without using the trademark. Can someone petition for expungement or reexamination against my registration? Trademark owners from most countries outside of the US can register trademarks in the US if they are registered in the owner’s home country. If this is your situation, your registration will be vulnerable to an expungement proceeding after three years (and before ten years) if it has never been used. The best way to avoid expungement will be to sell your goods or render your services in the US. Need assistance in navigating the new expungement and reexamination proceedings or guidance on protecting, enforcing or defending trademarks pursuant to these amendments? Please contact Laura Winston at lwinston@offitkurman.com or 347-589-8536.
January 14, 2022
Intellectual Property
Name, Image & Likeness (NIL): Three Key Legal Issues Facing Businesses in College Athlete Endorsement Deals to Date
The commercial landscape of college athletics has experienced significant change in recent months. The release of the new NCAA “interim policy,” prompted in part by the U.S. Supreme Court decision in NCAA v. Alston, has allowed college athletes and businesses to benefit from new endorsement and income opportunities involving the licensing of an athlete’s name, image, and likeness (“NIL”). Following the NCAA interim policy released in June 2021, a multitude of states enacted NIL statutes outlining the procedures and limitations for endorsement deals by athletes to license their NIL. Despite the world of opportunities that have opened up, the NIL landscape faces ongoing uncertainty and potential pitfalls due to the patchwork of NCAA, state, and university rules and regulations requiring compliance by college athletes and businesses. In order to benefit from all that NIL has to offer and avoid problems, businesses should be aware of three main legal issues that have been prevalent in NIL deals to date. (1) NIL agreements should comply with NCAA policies, state laws, and university rules In pursuing opportunities to contract with college athletes, businesses should perform their legal due diligence before finalizing any deal. Companies should strive to ensure that an NIL agreement complies with the NCAA interim policy, state law, and any applicable rules adopted by the school itself. If the state has yet to pass an NIL statute, the agreement should be flexible enough to accommodate future laws that may be enacted. Businesses should also consider that Congress may adopt a uniform federal law affecting NIL agreements. Even if a possible NIL deal satisfies the relevant state laws, businesses should also seek compliance with NCAA policies, such as the prohibitions against both pay-to-play and using NIL as a recruiting inducement. This means the agreement and related compensation cannot be, among other things, contingent on the athlete attending a specific school, participating in a certain number of games, or performing at a certain level. Businesses seeking endorsement deals with college athletes should also be aware of the categorical prohibitions on athlete association with certain brands or products under state law or university rules. These categorical exclusions vary by state and by institution and may even be enforced through team-specific codes of conduct. (2) NIL agreements should avoid conflicts with the university’s intellectual property and existing sponsorships A frequent hot topic in NIL deals has been the potential for conflicts with existing school or team sponsorships and with the use of school-specific intellectual property (“IP”), which may involve the school’s logos, nick-names, slogans, mascots, venues, and in some cases, team colors. Businesses should be aware of the possible limitations of NIL deals. NIL deals usually grant the sponsor the right to use the athlete’s IP. However, these agreements may not cover the use of the school’s IP, and the schools are not obligated to agree that their IP can be used. If the business wants the athlete to wear their team jersey, use the team locker room, or showcase a school landmark, the company will need to seek permission from the school itself. Universities have sometimes invoked their right to refuse such requests. Additionally, agreements between businesses and college athletes cannot conflict with existing school or team sponsorships with other companies. Athletes may face serious consequences if a NIL deal conflicts with existing sponsorships. Thus, it is in the business’s best interest to ensure that such conflicts do not occur. (3) NIL agreements should consider social media legal and branding issues The marketing opportunities presented by NIL deals have attracted both national brands and small, regional, and non-traditional businesses that may have previously struggled to secure high-profile endorsements. Nearly all businesses can now partner with college athletes, especially for relatively low-cost social media campaigns promoting their brands to an athlete’s followers. Using an athlete’s NIL in a social media campaign presents an enticing option for businesses that wish to engage with a younger audience, but there are certain risks associated with social media that should be evaluated and monitored closely. First, businesses should carefully vet the athlete and ensure that their personal brand and character align with the business’s approach to marketing. Social media campaigns can allow athletes to promote a company in a way that feels more personal and authentic to consumers. However, social media platforms also allow for real-time posting of user-generated content, which might not be subject to prior review. This could potentially hurt the business’s image if the athlete or others make comments that are not a good fit for the company. In addition, the ease through which photos and videos are shared on social media presents the risk of an athlete inadvertently violating IP limitations imposed by the school. To avoid these issues, businesses should consider designating a representative who will be responsible for managing the social media relationship between the athlete and the company’s brand. Conclusion In short, the groundbreaking changes in the NCAA interim policy on NIL have opened up a world of opportunities for businesses and college athletes. However, the legal risks associated with NIL deals require the respective parties to stay well informed on the relevant and quickly changing rules and regulations. In order to ensure your business is well protected, it is important to consult with counsel before entering into any NIL agreement. This summary of legal issues is published for informational purposes only. It does not dispense legal advice or create an attorney-client relationship with those who read it. Readers should obtain professional legal advice before taking any legal action.
December 29, 2021
Intellectual Property
Trademark Trial and Appeal Board Finds Reckless Disregard for the Truth Equals Fraud, Cancels Trademark Registration
The U.S. trademark law provides that a trademark registration may be canceled if it was obtained fraudulently. A registration may also be canceled if the registrant commits fraud in post-registration filings, including a Section 15 Declaration of Incontestability. Often filed in combination with the Section 8 Declaration of Use due in the 6th year of a registration, the Section 15 Declaration of Incontestability may be filed if the registrant has been using a registered mark continuously for the previous five years. However, certain other conditions are met, including that there are no pending proceedings, such as a lawsuit in federal court or a cancellation action before the US Patent and Trademark Office (USPTO) or Trademark Trial and Appeal Board (TTAB). This was the issue in Chutter, Inc. v. Great Management Group, LLC and Chutter, Inc. v. Great Concepts, LLC, 2021 USPQ2d 1001 (TTAB 2021). In 2010, when Great Concepts was submitting a combined Section 8 and 15 Declaration of Use and Incontestability for its trademark DANTANNA’S, the attorney for Great Concepts signed the declaration. He was aware that there were pending proceedings involving the trademark registration but, he later admitted, he did not read the declaration before signing it, and he was not familiar with the requirements of the Section 15 declaration. Years later, Chutter, Inc. filed a cancellation action against the registration, claiming that the Section 15 Declaration was fraudulently filed. In its decision, the TTAB noted that fraud requires an intent to deceive; false statements made with a reasonable and honest belief that they are true do not result in a finding of fraud. The TTAB went on to find that the attorney who signed the declaration acted with reckless disregard and held that this reckless disregard rises to the level of intent to deceive needed to find fraud. Moreover, although the trademark law allows for the opportunity in certain circumstances to correct misstatements once they are discovered, the attorney who signed the declaration did not take any corrective steps once he discovered that he had made false statements in the declaration. “By failing to ascertain and understand the import of the document he was signing, far from conscientiously fulfilling his duties as counsel, [the attorney] acted in reckless disregard for the truth; nor did he take any action to remedy the error once it was brought to his attention.” Stating that the attorney’s reckless disregard was “the legal equivalent of finding that Defendant Great Concepts had specific intent to deceive the USPTO”, the TTAB granted the petition to cancel the DANTANNA’S registration. Why does this decision matter to trademark owners? It’s a reminder to review carefully the statements in the documents you are signing and to ask questions if you do not understand something and speak up if something does not sound right. Although there is generally a high bar to a finding of fraud leading to the cancellation of a trademark registration, this case shows that a lack of attention to reviewing and understanding the statements being made in trademark declarations can constitute “willful blindness” that rises to the level of reckless disregard and cancellation of one’s trademark registration could be the result.
October 14, 2021
Intellectual Property
Navigating the New NIL Landscape: A Checklist for Athletes Looking to Profit
On June 30, 2021, the college athletics landscape was significantly altered, as the NCAA announced an “interim policy” concerning the commercialization of college athletes’ names, images and likenesses (“NIL”). NIL includes an athlete’s name, appearance, signature, nicknames and any other signs, slogans, sayings or symbols that can be used to identify that individual. Here is a basic step-by-step guide to help college athletes profit from their own NIL while complying with NCAA, state and school rules: (1) Know the interim NCAA policy. Athletes can now profit from NIL. State law where the school is located will apply. The school’s rules will also apply, even if there is no state NIL law. You can hire professional representation (attorneys, agents) with certain limitations. You must report NIL activities consistent with state law and school rules. Avoid NIL affiliation with NCAA’s banned sub-stances (drugs, performance-enhancing drugs, etc.). (2) Does your state have an NIL law? If so, know it. In order to play the game, you have to know the rules. Therefore, start by learning about your state's NIL law. If you are unsure, contact your athletic department or a local attorney for guidance. What are the “banned categories” in the state (drugs, alcohol, gambling, etc.)? What are the reporting requirements? What makes someone eligible to help you with NIL deals (state agency requirements)? (3) Know your institution’s NIL policy. You must know what your school does and does not allow. Can you use the school’s logo or facilities in your NIL activities with or without pre-approval? Is there a process to request approval to use school logos and facilities? Can you conduct NIL activities during team-sanctioned events? What are your school’s “banned categories”? Are there special NIL social media rules? Does your proposed endorsement conflict with the school’s existing product agreements? What are the school’s NIL reporting requirements? Does your school have a designated NIL administrator to help you? What is the enforcement mechanism and ap-peal procedure if you make an alleged NIL mistake? (You should consider hiring professional representation to help avoid this.) (4) Protect your NIL. If you are in the market for significant NIL deals, you should consider protecting your intellectual property (“IP”). Seek legal counsel with experience in both IP and sports law. The initial consultation will typically be at no cost. Beyond that, a small expense up front can pay off down the road. Register your IP. Register your name, nickname, or slogan as domain names. Protect your right to use your own NIL and prevent unauthorized third-party use by filing for trademark protection. What is a trademark? It is a word (name or nickname), symbol, design or slogan that can specifically identify you in commercial activities. Consider hiring a trademark attorney to assist you. How do I determine if it is cost-effective to take these steps? The NIL market is extremely new and, therefore, tough to judge. However, the more substantial contracts are being executed by players with larger social media followings and on-field presence. Regardless, do NOT sell yourself short. Test the market and see what deals you may attract. (5) Understand the impact of any earned income. Earning income from NIL may affect your personal financial situation, including your tax status and liabilities, your immigration status, and/or your financial aid package. (6) Seriously consider hiring professional representation. In accordance with NCAA, state and school guidelines, consider obtaining professional representation, such as an attorney or agent registered in the state. Also, consider whether obtaining financial, tax, immigration or other professional advice would be helpful. At the end of the day, no NIL deal is worth your NCAA eligibility or institutional good standing. This summary of legal issues is published for informational purposes only. It does not dispense legal advice or create an attorney-client relationship with those who read it. Readers should obtain professional legal advice before taking any legal action.
September 13, 2021
Intellectual Property
A Checklist for University Policies Addressing Student-Athlete Name, Image and Likeness (NIL) Issues
In the wake of the Supreme Court's decision in Alston v. NCAA, the National Collegiate Athletic Association ("NCAA") issued an interim policy announcing that it will no longer enforce its rules prohibiting compensation for the use of a student-athlete's name, image and likeness ("NIL"). Other athletic associations have like-wise amended their bylaws to allow student-athletes to profit from the use of their NIL. Additionally, new laws recently enacted by many states, such as Pennsylvania, now require institutions of higher education to publish policies on these issues. To comply with NCAA rules and state law, universities face a range of somewhat complex considerations in forming and implementing NIL policies and procedures. Here are some of the key issues in the form of a practical checklist: Know the NCAA policy or the policy of the athletic association that governs your institution's teams. The NCAA has a Division Manual for each of its three divisions. The Manuals are several hundred pages long and include at least several dozen policies that address issues that may be impacted by NIL activity. These manuals and policies have not yet been revised. Instead, the NCAA's interim policy states simply: "Individuals can engage in NIL activities that are consistent with the law of the state where the school is located. Colleges and universities may be a resource for state law questions. Individuals can use a professional services provider for NIL activities. College athletes who attend a school in a state without a NIL law can engage in NIL activity without violating NCAA rules related to name, image, and likeness. State law and schools/conferences may impose reporting requirements." https://www.ncaa.org/about/taking-action Know what hasn't changed in the NCAA manuals. Subject to state law, the NCAA still prohibits a "NIL agreement without quid pro quo (e.g., compensation for work not performed)." Subject to state law, the NCAA prohibits "NIL compensation contingent upon enrollment at a particular school." Subject to state law, the NCAA still prohibits "compensation for athletic participation or achievement. Athletic performance may enhance a student-athlete's NIL value, but athletic performance may not be the 'consideration' for NIL compensation." Subject to state law, the NCAA still prohibits "institutions providing compensation in exchange for the use of a student-athlete's name, image or likeness." https://ncaaorg.s3.amazonaws.com/ncaa/NIL/NIL_QandA.pdf (See Q. 11) Know your state's NIL law. A majority of states have enacted brand-new NIL laws, and the requirements vary considerably. Some states even require that institutions create funds from ticket sales or other promotional activities to benefit athletes. Pennsylvania's new law contains many provisions similar to those in other states. For example: Pennsylvania's law applies to institutions within Pennsylvania and to students participating in intercollegiate athletics at those institutions. The laws of other states may also apply to their residents regardless of where they attend school. 24 P.S. §20-2001k, et seq. Pennsylvania's law permits college athletes to earn compensation for the use of the athlete's NIL and provides that the compensation must be commensurate with the market value of the athlete's NIL. Pennsylvania's law prohibits college athletes from accepting compensation in exchange for their attendance, participation, or performance at the institution ("pay-for-play"). Pennsylvania's law prohibits college athletes from earning compensation for NIL use "in connection with a person, company or organization related to or associated with the development, production, distribution, wholesaling or retailing" of the following: Adult entertainment products and services. Alcohol products. Casinos and gambling, including sports betting, the lottery, and betting in connection with video games, online games, and mobile devices. Tobacco and electronic smoking products and devices. Prescription pharmaceuticals. A controlled, dangerous substance. Other products or activities prohibited by the institution. Pennsylvania's law also permits institutions to prohibit student NIL use more broadly: (i) in activities that conflict with existing institutional sponsorship arrangements and (ii) based on other considerations that conflict with institutional values, as defined by the institution. The Pennsylvania law requires institutions to have policies that "specify the name, image or like-ness activities [in] which the college student may not engage." Pennsylvania's law requires students to disclose proposed NIL contracts to a designated official of the institution at least seven days before the execution of the contract. Pennsylvania's law prohibits institutions (i) from preventing student-athletes from earning compensation through the use of the student's NIL or (ii) from obtaining professional representation in relation to NIL use. Pennsylvania's law prohibits institutions from arranging third-party compensation for a student-athlete relating to NIL use as an inducement to recruit prospective students. Pennsylvania's law requires any person producing a college team jersey, video game, or trading card for profit to make a royalty payment to each athlete whose NIL or "other individually identifiable feature" is used. Pennsylvania's law does not require institutions to facilitate or enable NIL opportunities for athletes. The law specifically states that it does not require an institution to permit athletes to use the institution's marks, logos, mascots, or other intellectual property. Know your state's student-athlete agency law. Many states, including Pennsylvania, require registration, which may include payment of fees and posting of bonds. See, e.g., 5 Pa.C.S. §3301 et seq. Tell the students where to find a list of "banned products." Pennsylvania's law requires that institutions disclose to students the types of deals that the institution prohibits. Therefore, institutional policies should let students know which products and activities are prohibited by state law and by institutional decree. For example, should student-athletes be permitted to engage in NIL activity for CBD and hemp products? Nutritional supplements? Guns? Professional sports teams? Gambling? Broadcasters? Can they contract with university entities, such as a meal service? Institutional policies should also specify products that conflict with school contracts, such as institutional sponsorship deals that include exclusivity promises. Policies should let students know whether all teams have a conflict or just certain teams. Is certain activity prohibited on social media? Tell students whether and how they can use the school's copyright materials (including game footage, logos, nicknames, mascots, etc.), and if appropriate, how to get permission to do so. Consider requiring all vendors, whether involved through the student NIL process or otherwise, to seek approval in the same way for the use of school marks. Tell students whether they can use the school's facilities and fields for NIL purposes, and if so, how to get permission to do so. Tell students whether NIL activity can interfere with class time or team activities. Warn students of other potential hazards, including: The need to consult with the designated school official for international students (because many students are in the United States on visas that prohibit employment), and The need to consult with the financial aid office (because a successful NIL venture may result in income, which may need to be included in determining income-based financial aid eligibility and awards). Indeed, before rolling out an NIL policy, it might be a good idea to coordinate with the university's financial aid office and international student office. Require disclosure of student-athlete NIL contracts. Pennsylvania law requires disclosure to the institution of all NIL contracts at least seven days prior to the execution of the contract. In other states, some institutions are establishing dollar amount thresholds. Your policy should clarify what happens in the event the institution is unable to respond in a timely manner. Does a failure to respond mean that the student has the institution's approval to proceed? Create a formal process for disclosure of NIL deals by student-athletes and review by the school. Many schools may find it helpful to designate an NIL coordinator. Consider requiring all agents representing student-athletes for NIL activities to register with your school and to provide basic information. Consider advising students of the need to comply with NCAA rules regarding agents, including that students "shall be ineligible… if the individual enters into an oral or written agreement with an agent for representation in future professional sports negotiations that are to take place after the individual has completed eligibility in that sport." NCAA Manual, Div. 1, 2021-22, bylaw 12.3.1.3. Consider providing education to students about (a) the NIL and agent registration laws, (b) protecting intellectual property, (c) financial acumen, and (d) university policies and procedures. Consider an internal appeal process or grievance process for NIL issues. Consider other policies and documents that may require review and revision: School contracts containing licensing provisions. Will the school be responsible for student NIL disputes with a university vendor? Insurance policies. Will the university's insurance respond if there are disputes? Social media policies. Student forms granting the university permission to use the student's NIL in connection with university promotional activity. Student discipline policies which may need to specifically identify the types of discipline that may be assessed on students who violate NIL rules. Student grievance policies. Do existing policies allow students to file complaints if the institution prohibits a proposed NIL contract or fails to respond to a proposed contract? Takeaways. Institutions of higher education must create policies to inform student-athletes of their rights and responsibilities and consider updating related rules across the full range of inter-connected issues within the institution. Institutions must be prepared to make further updates as additional guidance becomes available and as rules change.
September 13, 2021
Intellectual Property
Not Forgetting Trademarks: Protecting your NFT Brand
To Read Part One of our NFT series, click here »» This latest installment in Offit Kurman’s NFT series looks at protecting NFT’s under trademark law. As of July 21, 2021, a search of the US Patent and Trademark Office (USPTO) database shows that 407 trademark applications have been filed that list “non-fungible tokens” as goods and/or services. Of these, 374 were filed on or after March 11, 2021, the date that news broke that the digital artist Beeple sold an NFT at auction for $63.9 million. Looking at these trademark filings, we see that some familiar names are planning to get in on the NFT action. Fender has filed four applications to register trademarks for NFT’s, including its well-known guitar brand STRATOCASTER. The Andy Warhol Foundation for the Visual Arts, Inc. seeks registration of the name of the famous pop artist for NFT’s. And Lion’s Gate Entertainment, Inc. filed an application to register the trademark JOHN WICK, apparently planning to create NFT’s associated with the successful movie franchise. If you’re entering the NFT space, it’s good to keep in mind that your NFT’s are products, and trademark protection is important just as with any other product you might launch. Below are a few best practices for your NFT trademark strategy: Conduct a clearance search. Especially with this rapidly exploding area, it is important to make sure that there is not already someone else creating or marketing NFT’s under the same or similar trademarks. Consider searching more broadly than just NFT’s. Remember that NFT’s can touch various areas and industries when conducting your search. The examples above involve a music company, an artist’s estate and a motion picture series. Because NFT’s can be used to represent, commemorate or give value to all kinds of goods and services, it will be good to think broadly when conducting a clearance search. Once the clearance diligence has been done, file an intent-to-use application quickly. This will reduce the risk that a third party could apply to register the same or similar mark or commercialize an NFT business under the same name before you secure your rights. Many others are employing this strategy – of the 374 filings since March 11th, 320 are based on an intent to use. Use a watch service to detect similar trademarks or domain names using your trademark. Such uses could be innocent, or could intentionally try to capitalize on your success if your NFT line takes off. A watch service will alert you to such uses and enable you to evaluate and take action quickly. Your Offit Kurman attorneys can help position you to be at the forefront of this new technological wave. If you have any questions, please contact Laura Winston at lwinston@offitkurman.com or 347-589-8536.
July 29, 2021
Intellectual Property
It’s a New Game: Pennsylvania Statute Adopted on College Athlete Compensation for Name, Image and Likeness
On June 30, 2021, Governor Tom Wolf signed legislation to allow college athletes in Pennsylvania to earn compensation for the use of their name, image, and likeness ("NIL"). The new law, adopted as part of Senate Bill 381 ("SB 381"), was signed on the same day the NCAA approved a related policy reversing its long-held prohibition against such NIL activity. The new Pennsylvania statute, along with similar laws in other states and the NCAA policy reversal, follows years of mounting pressure from athletes. These reform initiatives reached a clear turning point with the unanimous antitrust decision by the U.S. Supreme Court in National Collegiate Athletic Association v. Alston on June 21, 2021, affirming an injunction against NCAA rules that had limited the education-related benefits schools may offer student-athletes. The NCAA's June 30 policy allows students who participate in intercollegiate athletics to engage in NIL activities consistent with the laws of the state in which their school is located. Those attending school in a state without NIL laws can still participate without violating the NCAA's NIL rules. Other non-NCAA athletic conferences may issue their own rules as well. However, Pennsylvania's new statute does not include those who take part in club or intramural sports or professional sports outside of intercollegiate athletics. SB 381 returns the individual Right of Publicity to college athletes, which was originally denied by prior NCAA regulations. With these regulations set aside, athletes can now take advantage of the same rights enjoyed by other public figures. SB 381 provides much-needed guidance in Pennsylvania for institutions of higher education and for athletes and their potential representatives in this brand-new and unprecedented era of student-athlete endorsements and compensation. Essential analysis and practical takeaways for athletes and schools are presented below. COLLEGIATE ATHLETES SB 381 states that "a college student-athlete may earn compensation for the use of the college student athlete's name, image or likeness." However, athletes should be cautious when pursuing opportunities, as there are specific rules and limitations under this new law. The statute includes detailed provisions about disclosure required by athletes before signing potential NIL deals; avoiding NIL compensation in exchange for participation or commitment to a school; avoiding product and service categories banned for use of NIL; avoiding conflicts with current school sponsorships; hiring professionals for assistance; and bringing a lawsuit if necessary. Under SB 381, athletes must disclose any potential NIL deals "at least seven days prior to execution of the contract to an official of the institution of higher education, who is designated by the institution of higher education." NIL compensation cannot be "provided in exchange ... for a current or prospective student-athlete to attend, participate or perform at a particular institution." This provision is intended to avoid transforming collegiate athletics into some form of a "pay-to-play" scheme. By way of restriction, the law provides that athletes "may not earn compensation . . . in connection with a person, company or organization" associated with these product and service categories: - Adult entertainment, - Alcohol, - Casinos and gambling, including sports betting, - Tobacco and electronic smoking products, - Prescription pharmaceuticals or - Controlled substances Furthermore, athletes may not engage in NIL activities and contracts that "conflict with existing institutional sponsorship arrangements at the time." For example, a school may be able to prohibit an athlete from engaging in an NIL agreement with one athletic shoe company when the school has a prior sponsorship arrangement with a different athletic shoe company. Schools may also prohibit a student's NIL activities based on other considerations, such as conflicts with "institutional values." In addition, schools "shall have policies that specify" the NIL activities in which athletes "may or may not engage." In addition to NIL compensation paid on a fixed-fee basis, athletes may also earn royalty payments. SB 381 requires a party that produces a college team jersey, video game or trading cards "for the purpose of making a profit" to make a royalty payment to each athlete whose NIL or "other individually identifiable feature" is used. It is important to note that payment for royalties or endorsements shall not affect the athlete's eligibility, scholarship, or grant-in-aid. College athletes can hire professional representation for their NIL dealings. These professionals can be: (1) An athlete agent meeting state registration requirements under 5 Pa.C.S. Ch. 33; (2) A financial advisor acting under Pennsylvania law; or (3) An attorney admitted to practice law by a court of record of the Commonwealth. However, "a person that represents an institution of higher education may not represent a college student-athlete in a business agreement." This language in the Commonwealth's new law needs clarification, but some may interpret this to mean that an individual representing the school in some capacity cannot also represent an athlete of that same university in their NIL dealings. These issues regarding potential conflicts for law firms in particular and whether such conflicts can be waived are yet to be determined. Athletes also maintain their right to pursue a private civil action for any violation of SB 381's NIL provisions, and they may receive costs and reasonable attorney fees, in addition to damages, if they prevail. COLLEGES AND UNIVERSITIES Pennsylvania colleges and universities ("institutions") and athletic associations and conferences, including the NCAA, are now prohibited from preventing an athlete from earning NIL compensation. An institution itself cannot be prevented by an association or conference from participating in intercollegiate athletics due to an athlete's NIL dealings. Institutions are not required "to identify, create, facilitate, negotiate or enable opportunities" on behalf of athletes to earn NIL compensation, but they can choose to do so. In addition, institutions are not required by SB 381 to allow athletes to use the school's "name, trademarks, service marks, logos, symbols or any other intellectual property," but again, they can choose to do so. This will open the door to opportunities for institutions to share in a revenue stream should they elect to license the use of their intellectual property as part of an athlete's endorsement campaign. Institutions may prohibit an athlete's involvement in NIL dealings that conflict with existing institutional sponsorship arrangements at the time of the athlete's disclosure. Similarly, institutions can prohibit NIL dealings that conflict with "institutional values." Institutions of higher education "shall have policies" that specify the NIL activities in which athletes "may or may not engage." As discussed above, prohibited NIL activities could include, at the very least, adult entertainment, alcohol, casinos and gambling (including sports betting), tobacco and electronic smoking products, prescription pharmaceuticals, or controlled substances. Schools also have the right to expand this list in accordance with their values and codes of conduct. In addition, schools maintain the right to establish and enforce academic standards and requirements, team rules of conduct or other rules of conduct, disciplinary rules applicable to all students, and policies regarding participation in intercollegiate athletics, such as NCAA rules. Schools must designate "an official of the institution of higher education" to receive notice from students disclosing a possible NIL contract. Also, "any person" who sells merchandise using an athlete's NIL must pay royalties to the athlete. This includes sales of jerseys, cards, or other merchandise that uses an athlete's name, image, or some other feature of identity. While the use of the term "any person" is slightly ambiguous, we believe that this is intended to include institutions of higher education. PRACTICAL TAKEAWAYS Athletes thinking about profiting from their NIL should consider contacting a licensed attorney and/or other professionals to assist them with the process. Endorsement agreements are often long, complicated documents that may contain language that works against the athlete's interests if not carefully reviewed. In addition, students will need assistance to ensure they are abiding by state law, school rules, and NCAA policies. Athletes may also benefit from professional representation if they want to negotiate for the right to use the logos and other intellectual property of their school or conference. Colleges and universities will need to closely address and monitor this issue. In considering opportunities for NIL compensation, an athlete who deems it to be cost-effective may further benefit from seeking federal trademark protection for his/her name, signature, nicknames, logos, and the like. Similarly, athletes should consider registering internet domain names based on such categories. Legal counsel well-versed in the costs and processes associated with intellectual property laws and practices can help to make these economic determinations and strategic filings. Institutions should consider drafting specific NIL rules, including those required by SB 381, and updating other relevant policies. Effective written policies will provide necessary guidance for athletes and protect the interests of the school. Ongoing training for staff and monitoring of NIL activities will also protect the school's interests in the event of a dispute. Policies should identify the official at the school who will be responsible for reviewing and approving contracts disclosed by athletes and address the circumstances under which contracts will not be approved. In order to protect its intellectual property, an institution should also consider expanding its portfolio of registered trademarks and logos to include protection for product categories that are likely to be the subjects of athlete NIL endorsements. Although institutions are not required to facilitate NIL opportunities for students, it will likely benefit the institution to find appropriate ways to assist athletes in such activities. Schools may want to consider relaying such opportunities to their athletes and suggest prospects for mutual participation in these deals. SB 381 constitutes a significant development for collegiate athletes in their longstanding efforts to protect and benefit from their Right of Publicity. However, there are some outstanding questions that remain, including: Will institutions be subject to the statutory provisions requiring royalty payments for the sale of merchandise using athletes' NIL? Can institutions charge athletes a royalty or a flat fee for the use of the institutions' trademark, logo, and other intellectual property in conjunction with the athletes' endorsement deals? What are the parameters of the conflicts provision stating, "a person that represents an institution of higher education may not represent a college student-athlete in a business agreement"? What effect will this have on lawyers and law firms, and can these conflicts be waived? Is there a transparency requirement for these NIL contracts, and must they be disclosed to the public? When a student discloses a potential NIL contract at least seven days prior to its execution, as required by SB 381, what will happen if the school fails to review the contract within this time? Athletes and institutions, as well as companies con-templating endorsement deals with students, should consider working with attorneys and other professionals who have broad experience with the various interrelated aspects of these issues, including the state and federal laws for higher education, intellectual property, sports law, and other relevant subjects. In short, the game has changed in a big way for both college athletes and their educational institutions. We are monitoring these emerging issues and will continue to report on material developments. As these matters evolve over time, individuals and organizations should consult with counsel. This summary of legal issues is published for informational purposes only. It does not dispense legal advice or create an attorney-client relationship with those who read it. Readers should obtain professional legal advice before taking any legal action.
July 15, 2021
Intellectual Property
Summer School for Intellectual Property
Universities Must Prepare Student-Athlete Endorsement Policies in Response to New NCAA Rules On June 30, 2021, the National Collegiate Athletic Association (“NCAA”) officially adopted a uniform interim policy suspending previous NCAA name, image and likeness (“NIL”) rules for all incoming and current student-athletes in all sports. The move would allow athletes in all NCAA divisions to profit from endorsements, their signatures, public appearances, and other business ventures for the first time in over a century. Background College student-athlete’s ability to receive full compensation has been at the forefront of statutory, litigation and political initiatives for the last several years. In addition to the class action antitrust lawsuit that culminated in the U.S. Supreme Court’s recent ruling in NCAA v. Alston, several states have taken legislative action to address student-athlete endorsements. California’s Fair Pay to Play Act passed in 2019 and is set to become effective on January 1, 2023. New Jersey’s NIL law will become effective in 2025, but efforts are underway to move up that date. Indeed, several other states have also taken up the baton with more immediate effect: similar endorsement laws in Alabama, Florida, Georgia, Mississippi, and New Mexico already went into effect on July 1, 2021. The NCAA’s Board of Governors had previously proposed expanding its NIL rules in April 2020, but the Divisions failed to take action. Apparently, the abrupt implementation on June 30, 2021, of the new interim policy was likely prompted by the recent outcome in Alston, along with concerns that the state-by-state approach could give rise to further litigation and complications for recruitment and compliance. The NCAA has signaled that this expansive new policy is only temporary and that it intends to pursue a federal solution with Congress that would provide clarity on a national level. The New Rules The new NCAA policy provides the following guidance to college athletes, recruits, and member schools: Individuals can engage in NIL activities that are consistent with the law of the state where the school is located. Colleges and universities may be a resource for student-athletes regarding state law questions. College athletes who attend a school in a state without an NIL law can engage in this type of activity without violating NCAA rules related to name, image and likeness. Individuals can use a professional services provider for NIL activities. Student-athletes should report NIL activities, consistent with state law or school and conference requirements, to their university. Additionally, students are allowed to sign with agents or other professional representatives to help them acquire endorsement deals with the following caveat – students cannot stipulate that the agents would represent them in future negotiations outside of the NCAA. Some restrictions still remain in effect. NIL compensation cannot be contingent upon enrollment at a particular school, nor can the school compensate an athlete in exchange for the use of the student’s NIL. Compensation for athletic participation or achievement, or pay-for-play, remains prohibited, as affirmed by the U.S. Supreme Court in NCAA v. Alston. Next Steps for Colleges and Universities The change in NCAA policy means that higher education institutions nationwide will have to accelerate their response over this summer in time for the fall athletic season. Such preparation may be especially important, as the NCAA policy encourages student-athletes to turn to their schools for information about their state’s NIL law. Schools in states that have adopted NIL laws may have the benefit of such state rules as a guideline, but all schools will have to confront some common issues: Whether to permit the student-athlete to use the school’s trademarks in endorsements and, if so, what kind of reasonable restrictions should be put in place? Would the school require an approval process for the endorsements? How do the NIL rules affect the school’s other policies (for example, its social media use policy) or the school’s existing relationships with sports retailers? What new resources should be made available to help the school and the students navigate the legal and compliance issues related to student endorsements? While some schools, such as Louisiana State University, will allow students to use its official logos and facilities in endorsements so long as the athletes ask for written permission, not all schools will adopt such a broad policy. Schools may want their policies, training, and related communications on this issue to reflect possible complications and disputes. For example, how will the school approach a situation where a student enters into an endorsement agreement for products or approach that could give rise to further litigation and complications for recruitment and compliance? The NCAA has signaled that this expansive new policy is only temporary and that it intends to pursue a federal solution with Congress that would provide clarity on a national level. For this summer, at least, schools have their hands full with a significant intellectual property homework assignment. This summary of legal issues is published for informational purposes only. It does not dispense legal advice or create an attorney-client relationship with those who read it. Readers should obtain professional legal advice before taking any legal action.
July 6, 2021
Intellectual Property
What Does the Future Hold for College Athletics after the Supreme Court Decision in NCAA v. Alston?
On June 21, 2021, the United States Supreme Court issued a unanimous decision in National Collegiate Athletic Association v. Alston. The long-anticipated decision affirmed the injunction against NCAA rules that limited the education-related benefits schools may offer student-athletes. But perhaps equally as important as the majority decision is the concurring opinion by Justice Kavanaugh. BACKGROUND Current and former student-athletes in men’s Division I FBS2 football, and men’s and women’s Division I basketball brought a class-action claim against the NCAA and eleven Division I conferences, alleging that their agreement to restrict the compensation colleges and universities may offer the student-athletes who play for their teams violated the Sherman Anti-trust Act. The District Court’s March 2019 ruling enjoined the NCAA from enforcing “rules limiting the education-related benefits schools may offer student-athletes—such as rules that prohibit schools from offering graduate and vocational scholarships.” However, the District Court decision also allowed the NCAA to maintain its rules limiting athletic scholarships to the full cost of attendance and restricting compensation and benefits unrelated to education. The Ninth Circuit affirmed, and the injunction took effect in August 2020. SUPREME COURT DECISION On appeal, the Supreme Court only considered the injunction’s legality. The Court unanimously held that “[t]he district court’s injunction is consistent with established anti-trust principles” and that the NCAA’s compensation restrictions were “properly subjected to antitrust scrutiny under a ‘rule of reason’ analysis.” The Court determined that: First, “the NCAA enjoys ‘near complete dominance of, and exercise[s] [monopoly] power in, the relevant market’” of “athletic services in men’s and women’s Division I basketball and FBS football.” As a result, the NCAA and its member schools are able to “restrain student-athlete compensation in any way and at any time they wish, without any meaningful risk of diminishing their market dominance.” Second, while the NCAA was concerned that the injunction would result in “micromanagement” of its business, the Court noted that the injunction applies only to the NCAA’s rules “limiting the education-related benefits” that conferences or schools may offer student-athletes. Relaxing these restrictions will not “blur the distinction between college and professional sports,” and the NCAA can achieve the “same procompetitive benefits” by significantly less restrictive means than its current rules provide. Finally, because the injunction applies only to the NCAA and multi-conference agreements, the Court reasoned that the injunction both leaves the NCAA with “considerable leeway” and leaves the individual conferences and their member schools “free to impose whatever rules they choose.” With this in mind, the Court upheld the injunction prohibiting the NCAA from enforcing its rules limiting education-related benefits that conferences and schools may provide to student-athletes, including those rules limiting scholarships for graduate or vocational school, payments for academic tutoring, and paid post-eligibility internships. These education-related benefits could not “be confused with a professional athlete’s salary.” The Court also held that the NCAA may continue to limit cash awards for academic achievement, but only if those limits are no lower than the cash awards currently allowed for athletic achievement (currently a maximum of $5,980 per year, but the NCAA is free to reduce the amount). To the extent the NCAA is concerned that schools might exploit the injunction to give student-athletes “unnecessary or inordinately valuable items” that are only nominally related to education, the Court held that the NCAA can specify and enforce “rules delineating which benefits it considers legitimately related to education” and forbid questionable benefits. Finally, the NCAA and its member schools can propose a definition of “compensation or benefits related to education,” and the NCAA is free to regulate how conferences and schools provide them. TAKEAWAYS Alston may bring student-athletes one step closer to receiving full benefits for their services. Looking forward, Justice Kavanaugh’s concurring opinion may give hope to student-athletes that further ground can be gained on this issue. Justice Kavanaugh directed his attention to the NCAA’s remaining compensation rules and suggested that they also “raise serious questions under the antitrust laws.” He found that these rules should also be scrutinized under “rule of reason” analysis, “absent legislation or a negotiated agreement between the NCAA and the student-athletes.” In such a case, Justice Kavanaugh leaves little doubt about how he would rule: The NCAA’s business model would be flatly illegal in almost any other industry in America . . . Price-fixing labor is price-fixing labor . . . No-where else in America can businesses get away with agreeing not to pay their workers a fair market rate on the theory that their product is defined by not paying their workers a fair market rate. And under ordinary principles of anti-trust law, it is not evident why college sports should be any different. The NCAA is not above the law. Alston and the threat of potential future litigation may spur the NCAA to negotiate an agreement with conferences and schools, or even with student-athletes if they become unionized, out of concern that another court will use “rule of reason” analysis to dismantle its remaining compensation rules or otherwise “micromanage” its business. A negotiated agreement would at least allow the NCAA to maintain some control over whether any of its remaining compensation rules remain intact. The NCAA may also explore other options to achieve more robust compensation for student-athletes, including further expansion of the rules on how student-athletes may use their name, image and likeness beyond the NCAA Board of Governors’ proposed rules from April 2020. Read the Court’s ruling in Alston here: https://www.supremecourt.gov/opinions/20pdf/20-512_gfbh.pdf. This summary of legal issues is published for informational purposes only. It does not dispense legal advice or create an attorney-client relationship with those who read it. Readers should obtain professional legal advice before taking any legal action.
June 28, 2021
Intellectual Property
Is Genericide Still A Thing? Maybe We Worry Too Much About 'Proper Use Of Trademarks'
As Published in The Legal Intelligencer – Special Section March 2021: Intellectual Property By: Laura Winston Earlier this year, the comedian Seth Meyers was making a joke about a politician on his talk show "Late Night with Seth Meyers." In doing so, he referred to a well-known brand of popular plastic building bricks as “Legos.” Mr. Meyers was immediately flooded with online comments telling him that the plural of Lego is Lego. He took to the airwaves again on the topic, thanking the commenters but adding, “It’s too late for me…I’m not going to walk home and tell my kids `Clean up your Lego’”. Not long after, the owner of the world-famous LEGO trademark got into the act via a tweet, saying, “Hey @SethMeyers, let us blow your mind...the plural is not `Legos.’ It’s not even `Legos.’ It's actually `LEGO BRICKS!’" @LEGO_Group, Twitter (February 11, 2021), https://twitter.com/lego_group/status/1359856214591627269. If you have questions about this or any other legal matter, please feel free to contact Laura Winston at 347.589.8536 Reprinted with permission from the March 30, 2021 issue of The Legal Intelligencer. © 2021 ALM Media Properties, LLC. Further duplication without permission is prohibited. All rights reserved.
April 5, 2021
