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IP SURVEY OUTLINEProf. Ochoa, Fall 2015COURSE OUTLINEINTRODUCTIONRationales for protection of IPRationales for limitation of IPTRADE SECRET LAWDefinitionMisappropriationAcquisition by improper meansDisclosure or use of Trade SecretDefensesReverse EngineeringIndependent InventionOwnershipRemediesPATENT LAW [35 USC ]Patent ProsecutionSpecification and claimsWritten description, enablement & best modePatentable Subject MatterStatutory RequirementsUtilityNovelty & Statutory BarNon-obviousnessExclusive Rights & DurationInfringementDefensesDesign PatentsCOPYRIGHT LAWPrerequisitesOriginality and FixationIdea/Expression and Merger DoctrineCopyright in Useful ArticlesPublication, Formalities, DurationPublication and NoticeRegistrationDuration & RenewalInfringementExclusive rightsCopying and Substantial Similarity of ExpressionMoral RightsFair UseRelated State-Law Claims: Idea Submission and MisappropriationTRADEMARK LAWTrademark Subject MatterFanciful, arbitrary and suggestive marksDescriptive marks and secondary meaningGeneric termsTrade dressFunctionalityUse and Ownership Common-law priorityRegistration of mark on the Principal RegisterAdvantagesIncontestabilityIntent-to-Use applicationsGeographic scope of trademarkCommon-law ruleGood-faith remote junior userDawn Donut ruleTrademark InfringementDefenses to InfringementDescriptive fair useNominative fair useTrademark DilutionFalse AdvertisingRIGHTS OF PUBLICITYCommon-Law RightUse of identity for commercial purposesPost-mortem rightsDefensesFirst-saleFirst AmendmentCOMMON THEMESOwnershipExhaustion (First-Sale doctrine) and Parallel ImportsSecondary LiabilityRemediesInjunctive reliefMonetary reliefPreemptionINTRODUCTIONSources of AuthorityConstitution: Art. I, § 8, Cl. 8 Patent & Copyright“To promote the progress of Science and the useful Arts, by securing for limited times to Authors and Inventors the exclusive rights to their respective writings and discoveries.”Federal LawPatent: 35 U.S.C.Right of inventors – 20 yr periodExclusive right = monopolyCopyright: 17 U.S.C.Right of Authors, Publishers & Consumers – life of author + 70 yrOriginal works of authorshipExclusive right to produce Trademark: 15 U.S.C. + State LawLaw of brand names and logos – anything used to distinguish the goods and services of one business from anotherFalse advertisingIndefinitely as long as business is usingState LawTrade SecretUnfair competition – common law tort (i.e. false advertising, trade secret misappropriation and trademark infringement originated here but is now codified under federal law)Right of PublicityRationales for Protection of IPPatent & CopyrightIncentive -- financial incentive to create things and protect them from free-ridingNatural right/ unjust enrichment -- the creator deserves to profit from their creationTrademark = consumer protectionPrevents confusion in relevant marketsProtects good will of producerRationales for Limitation of IPFree competition -- provides goods at the lowest possible pricesProtection of public domainFreedom of speech (copyright and trademark)** Where legislation is ambiguous, refer to these policy considerations to justify a certain outcomeINS v. Associated PressHold: unfair competition by ?, as two competing parties are endeavoring to make money and ?s are misappropriating π’s quasi property interest in the news it collected and misrepresenting it as their own. (justified as “natural right”) Limitation: only postpones participation of ? in distribution and reproduction that ? has not gathered, and only to the extent necessary to prevent competitor from reaping fruits of π’s efforts and expendituresStanley v. Columbia Broadcasting System, Inc.: to insure free trade in ideas the monopoly created by copyright is limited to the arrangement and combination of ideas – the form, sequence, and manner in which the composition expresses the ideas.-2286001600200TRADE SECRETS00TRADE SECRETSSears, Roebuck & Co. v. Stiffel Co.: A State may not, consistently with the Supremacy Clause, extend the life of a patent beyond its expiration date or give a patent on an article that lacked the level of invention required for a federal patent. State law of unfair competition cannot override the federal patent law.Trade Secret ProtectionState Law – but 47 states have adopted Uniform Trade Secret ActSteps of AnalysisDoes the information or idea at issue qualify as a trade secret; ANDIf so, is the ?’s acquisition, disclosure, or use of it prohibited under one of the theories of improper means or misappropriation?What are the secrets? Trade Secret: information of any type (including formulas, recipes, patterns, computer programs, databases, and methods) that –Derives independent economic value fromNot being generally known to, and not being readily ascertainable by proper means, by other persons who can obtain economic value from its disclosure or use; andIs subject of efforts that are reasonable under the circumstances to maintain its secrecyFactors to consider in determining existence of TS:The extent to which the secret is known to otherExtent of efforts to keep it secret (i.e., non-disclosure agreements, how effective measures will be, limited to need-to-know)Ease to which it could be acquired by othersValue of the secretCybertek: Software protectable under TS doctrine, given appropriate facts and circumstancesLife insurance software constituted a tradesecret because the combination of concepts as developed and utilized in its system went beyond general information known in computer industry.Was there misappropriation or improper means?Misappropriation [UTSA § 1(2)]Acquisition by improper means; ORDisclosure or use of a TS of another w/o express or implied consent by a person whoUsed improper means to acquire knowledge of the TS; ORAt the time of disclosure or use, knew or had reason to know that his knowledge of the TS was –Derived from or through a person who had utilized improper means to acquire it;Acquired under circumstances giving rise to a duty to maintain its secrecy or limit its use; orDerived from or through a person who owed a duty to the person seeking relief to maintain its secrecy or limit its use; orBefore a material change of his position, knew or had reason to know that it was a trade secret and that knowledge of it had been acquired by accident or mistake.Improper Means [UTSA § 1(1)]: generally, those that are independently unlawful -- includes theft, bribery, misrepresentation, breach, or inducement of a breach of duty to maintain secrecy, or espionage through electronic or other meansDuPont v. Christopher: broader view of improper means including anything that violates the generally accepted principles of commercial morality and reasonable conduct.Hold: Aerial photography from whatever altitude, is an improper method of discovering the trade secrets exposed during construction of the DuPont plant π may prohibit disclosure.This is an example illustrating that improper means does not have to be independently unlawfulBreaches of Confidence Finding a duty of confidentiality, or duty to maintain secrecy. Look for:? may have a duty by virtue of her relationship to the π Traditional fiduciary relationships s/a partnership and joint venture relationships, or attorney-client relationshipsContracts implied-in-fact and implied-in-lawExpress contractual provisionThird-Party Liability: To be liable, persons obtaining a TS through an intermediate source, rather than directly from the π, must have notice, or reason to know, that the information is a TS and was obtained or is being disclosed through improper conduct or a breach of confidence.Inevitable DisclosurePepsico v. Redmond: threatened misappropriation can be enjoined where there is a high probability of inevitable and immediate use of the TS ?’s new employment will inevitably lead him to rely on π’s TS.Hold: π injunction granted – the particularized plans/processes developed by π and disclosed to ? while under employment, which are unknown to the industry, would inevitably be used as ? launches Gatorade and Snapple’s new plan know exactly how competitor will price, distribute and market drinksProblems with Doctrine:Creates a de facto non-compete and runs counter to public policy favor employee mobilityCovenant is imposed after the employment contract is made and therefore alters the employment relationship w/o employee’s consentDefensesProper means = independent invention or reverse engineering, but ? has BOPIf ?’s (or its source’s) means of obtaining the t/s are “proper”, and there is no duty of confidentiality, the ? is free to use or disclose the t/s with impunity. This is where t/s law differentiates from patent law – t/s offers no protection for work that has been disclosed to the public. General Employee Knowledge & SkillRULE: employee is free to take general skills and knowledge acquired in the course of employment and use it in later pursuits.Fleming Sales v. Bailey: RV manufacturer exec left and joined competitorHold: MSJ for ? could have had a covenant not-to-competeGeneral contact information of customer’s that is otherwise publicly available and readily ascertainable is not protectable as trade secrets; ANDBusiness experience and knowhow as reflected in information π attempts to conceal (names, contact info and purchase history of customers), however valuable, are not something the law protects from the rigors of the market-place.Cf: Webcraft - ? (previously employed by custom printing co.) took rolodex of customers which took time and effort to create (not available to stranger), signed a non-disclosure agreement, took price information and quotesProtection for Non-Trade Secrets: Restrictive CovenantsRULE: generally, restrictive covenants will be enforced only if they are reasonable with respect to the coventee, the coventor, and the public interestCovenants Not to Compete: employee agrees not to compete with the employer after leavingRULE: whether reasonably necessary to protect employer from improper or unfair competition – Does the employer have a legitimate business interest needing protection?Is the restrictive covenant reasonable in scope?Reasonableness: time (<2 years), place/location, scope of competition restricted, etc.Strictly construed against employer & employer bears burden of demonstrating that restraint is reasonableCA Business and Prof. Code: every contract by which anyone is restrained from engaging in lawful profession, trade or business of any kind is to that extent void Nondisclosure Agreements: employee agrees not to disclose trade secret of other confidential information of the employer during and after her employmentRULE: NDAs that unreasonably restrain competition or unduly hinder an individual from pursuing his chosen livelihood will be unenforceableRemediesInjunction: π must demonstrate irreparable injury and an inadequate remedy at law in order to obtain an injunctionInjunction is terminated wen the trade secret has ceased to exist, but may be continued for an additional reasonable period of time in order to eliminate commercial advantage that otherwise would be derived from the misappropriation. [UTSA § 2(a)]Damages-2286000PATENTS00PATENTSUtility PatentsCriteria for Patents§ 101: Useful (utility) must be patent eligible subject matter§ 102: Novel§ 103: Non-obvious Patent ProsecutionProcedural Criteria: A patent application must include - A written specification (§ 112)A technical drawing (§ 113)Claims; andAn oath or declaration (§ 115)EXECPT: Inventors who wish to obtain an early filing date may file a “provisional application” must file a written description of the invention, the drawings, but need not submit claims or an oath/declaration.Specification and Claims [§ 112] Specification includes:An enabling description – a written description of the invention that is sufficient to enable a person having ordinary skill in the art (PHOSITA) to practice the invention. The invention need not be reduced to practice.Technical drawingsExplaining the invention and why it’s better than prior artClaims: explaining in legal language the scope of the invention in elementsEach claim is evaluated separately – family of designs covered by the claim must include at least one member that is disclosed in the detailed part of the patent application“Consists of” = limited to elements; comprises = includes, but not limited toIn order to examine validity, the claim is compared to prior art – family of designs covered by the language of a valid claim must not include any design disclosed in the prior literatureWritten description, enablement, and best mode: best known mode is still a requirement in the statute, but failure to include best known mode is no longer grounds for invalidationProcedureSubmit applicationIf denied, may appeal to PTABMay appeal PTAB judgment directly to federal circuit, or to district court for N.D.V.A. if you want to introduce new evidencePatentable Subject Matter [35 U.S.C. § 101]: “Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.”Legislative history: anything under the sun that is made by man – humans excluded. Statues includes:Processes, machine, manufacture, or composition of matter, ORAny improvement thereof.SCOTUS:Patent eligible: a non-naturally occurring manufacture or composition of matter – a product of human ingenuity having distinctive name, character, and use.Manufacture: the production of articles for use from raw or prepared materials by giving to these materials new forms, qualities, properties, or combinations, whether by hand-labor or by position of matter: all compositions of two or more substances and all composite articles, whether they be the results of chemical union, or of mechanical mixture, or whether they be gases, fluids, powders or solids.EX: Diamond v. Chakrabarty: π’s genetically-engineered micro-organism is patentable subject matter – not nature’s handiwork, but his own joining of two separate plasmids to create one organism (Cf: Funk – combo of two things that stay separate)Patent ineligible: laws of nature, physical phenomena, mathematical formulas or algorithms, and abstract ideas are not patentable. Laws of NatureMayo: method for measuring metabolites in bloodstream to determine how your body processes a drug and how much drug is needed for effective treatment is a “law of nature” and not patentable subject matterAMP v. Myriad: Isolated DNA segments are naturally occurring = not patentableAbstract Ideas Alice Corp. Hold: abstract idea of intermediated settlement as performed by a generic comp. was not patentable and generic method claims failed to transform the abstract ideaSteps of Analysis: A court must first identify - The abstract idea represented in the claim, and thenDetermine whether the balance of the claim adds “significantly more” (Routine, conventional, post-solution activities don’t count)Distinguish between patents that claim the building blocks of human ingenuity and those that integrate the building blocks into something more, thereby transforming them into a patent-eligible invention** Many software patents threatened by this decisionBilski: ineligible -- “[h]edging is a fundamental economic practice long prevalent in our system of commerce and taught in any introductory finance class.”Flook: ineligible -- A computerized method for using a mathematical formula to adjust alarm limits for certain operating conditions (e.g., temperature and pressure) that could signal inefficiency or danger in a catalytic conversion processDiehr: eligible -- computer-implemented process for curing rubber was patent eligible b/c it used a thermocouple to record temperature measurements inside the rubber mold, which is an improvement to an existing technological process that the industry had not been able to doMisc. CasesJEM Ag Supply v. Pioneer: sexually reproduced plants may be subject of a utility patent, even though they may also be protected through a certificate of plant variety protectionStandards of Patentability – Substantive Patent RequirementsSteps of AnalysisDetermine whether the pre-AIA provisions or post-AIA previsions apply.If pre-AIA Determine who was the “first-to-invent” and whenCompare this date to the relevant statutory requirementsIf post-AIA Determine who was the “first-to-file” and whenCompare this date to the relevant statutory requirementsConclude who is entitled to the patentDetermining What Standards to ApplyIf application was filed before March 16, 2013 old version of § 102 & § 103 applyOld sections assess novelty and obviousness at the time of invention first-to-inventInvention: conception + reduction to practiceConception: when the inventor formulates a definite, complete idea of the operative invention, so that all that remains is the physical realization of itReduction to practice: (a) actual = building a physical prototype and ascertaining that it works; or (b) constructive = filing patent applicationException: First to reduce invention to practice is presumed to be the inventor, but first to conceive may rebut presumption if he/she was reasonably diligent in reducing it to practice (2011 Exam – 3 weeks between conception and reduction is reasonable).If no date is given, the inventor is presumed to have reduced the invention to practice on the date of filing.If application was filed on or after March 16, 2013 new sections applyNew sections assess novelty and obviousness at the time of application first-to-fileEffective filing date: defined as the actual filing dateUtility: § 101 - “Whoever invents or discovers any new and useful process..”Well-Established Utility:If a person having ordinary skill in the art (PHOSITA) would immediately appreciate why the invention is useful based on the characteristics of the invention; ANDThe utility is specific, substantial, and credible.Brenner v. Manson: a process is not patentable unless we know the use of the product it creates Process of creating steroid not patentable until we know what steroid is good for Unless and until a process is refined and developed to the point where there is specific benefit derived to the public, there is insufficient justification for permitting an applicant to engross what may prove to be a broad fieldNovelty & Statutory Bar: § 102Steps of AnalysisDetermine filing date If filed before 3/16/13 use pre-AIA rulesIf filed after 3/16/13 use revised-AIA rulesGo through each sub-section to determine whether invention qualifies as novelNovelty: Lack of novelty (“anticipation”) exists if there is a single prior art disclosure which contains all elements of the claim arranged in the same manner must compare claims to every section of prior art, cannot combine claims (NetMoney)NetMoneyIn,Inc.: The IKP reference setting forth standard of how payments may be accomplished “efficiently, reliably, and securely” did not disclose all the limitations recited in ?’s claim error to find anticipation by combining different parts of the separate protocols in the IKP reference. Courts may recognize “inherent anticipation,” where the reference does not expressly disclose all the elements of the later invention, but the non-express elements are nonetheless necessarily present in the thing described/ disclosed in the referencePre-AIA: applications filed BEFORE March 16, 2013 (a) Patent denied if prior to invention by applicant, the invention was:“Known” in the USInvention was fully disclosed – sufficient to enable a PHOSITA to practice the invention; ANDAccessible to the public (opposite of secrecy).“Used” by others in the USInvention was actually reduced to practice; ANDWas accessible to the public (i.e., absence of affirmative steps to conceal)The subject of a patent anywhere in the world, ORPatents become part of prior art on the date of issuance, if minimally accessible to the publicWas revealed in a “printed publication” anywhere in the worldPublication must be fixed in a tangible medium AND made accessible to the public(e): Patent denied if invention disclosed in a U.S. patent application pending on the date of invention and later either published or granted.(f): Patent denied if applicant did not invent the invention(g): Patent denied if prior to A’s invention, another person made the invention in the U.S., or another person establishes in an interference that he made invention abroad prior to the applicant’s invention, if the invention not abandoned, suppressed, or concealed.Statutory Bar Provisions(b): Patent denied if > 1 year before date of filing, the invention was in public use or on sale in the U.S., or was patented or described in a printed publication anywhere in the world.Focuses on the activities of anyone (including the applicant) > 1 year before the date of filing Public use: Use by the inventor for commercial purposes, but not for private enjoyment. Experimental use (or sale) will not trigger, even if public.Experimental Use: Must be testing the device, not the market (market testing = where the inventor is attempting to gauge consumer demand for his claimed invention)EXAMPLESCity of Elizabeth: inventor applied his pavement on a public road and evaluated it for 6 years experimentalIn re Smith: Airwick product tested by 76 homemakers = market testing, NOT experimental On SalePfaff: on-sale bar applies when a product embodying the invention is The subject of a commercial offer for sale, (satisfies formal standards of offer under UCC); andReady to patent (either reduced to practice or proof that an enabling disclosure could be made)Moleculon: (rubik’s cube) an assignment or sale of rights in the invention and potential patent rights is not a sale of “the invention” within the meaning of § 102(b) means tangible embodiment of product, who has the “control”(c): Patent denied if inventor has abandoned the invention. May be express or impliedMeans abandonment of the right to patent the invention Cf: (g) means abandonment of the invention itself – inventor no longer working on it(d): patent denied if the invention was subject of a foreign patent app > 1 year before app was filed in U.S. and foreign patent issues before app filed in U.S.Current: applications filed AFTER March 16, 2013DifferencesNo geographical restrictions everything in the world counts(b)(1) exception to (a)(1)(b)(2) exception to (a)(2)Similarity: 1-year grace period stand (public disclosure w/in 1-year of filing OK)35 U.S.C. § 102 (revised)(A) A person shall be entitled to a patent unless:Claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing dateThe claimed invention was described in an [issued] patent… or in an application for a patent published or deemed published…in which the patent or application … names another inventor and was effectively filed before the effective filing date of the claimed invention(B) If there is an enabling disclosure, inventor disqualified from patent UNLESS disclosure is excluded from prior art. Exceptions:A disclosure made 1 year or less before the effective filing date of the claimed invention shall not be prior art … under (a)(1) if:Disclosure was made by the inventor or by another who obtained the subject matter disclosed directly or indirectly from the inventor; ORThe subject matter disclosed had, before such disclosure, been publicly disclosed by the inventor…or another who obtained the subject matter directly or indirectly from the inventorA disclosure shall not be prior art to a claimed invention under (a)(2) if:The subject matter disclosed was obtained directly or indirectly from the inventor; “ “ had, before such subject matter was effectively filed under (a)(2), been publicly disclosed by the inventor or another who obtained it directly or indirectly from the inventor;“ “ and the claimed invention, not later than the effective filing date, were owned by the same person or subject to an obligation of assignment to the same personNon-Obviousness: § 103RULE: A patent for a claimed invention may not be obtained… if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date to a person having ordinary skill in the art to which the claimed invention pertains. Filing date before 3/16/13 obvious at applicant’s invention dateFiling date after 3/16/13 obvious at applicant’s effective filing dateCf: Novelty – here, one may combine prior art references to demonstrate obviousnessSteps of Analysis (Graham v. John Deere)Factual determinations: The scope and content of the prior art;The differences between the prior art and the claims at issue; ANDThe level of ordinary skill in the pertinent artLegal Determinations: Would the subject matter of the patent application have been obvious to a person having ordinary skill in the art (PHOSITA) and knowledge of the pertinent prior art?ConsiderationsWas the general idea of the invention conceived prior to the applicant?Was the concept publicly known?If an improvement to an existing invention, how long has the original been in public use without any necessary improvements?Secondary Considerations: courts may also consider such things as commercial success, long felt but unresolved needs, failure of others, skepticism or movement of others in different directions, etc. to indicate invention was non-obvious.**If an alleged infringing art is similar and can be found to have been “independently invented” obvious (2012 exam)DefinitionsPrior Art: considered analogous if – It is from the same field of endeavor, regardless of the problem addressed, ORIf not in the same field, if it is reasonably pertinent to the particular problem with which the inventor is involvedReasonably Pertinent: even though it may be in a different field from that of the inventor’s endeavor, it is one which, because of the matter with which it deals, logically it would have commended itself to an inventor’s attention in considering his problem** One may combine prior art references to demonstrate obviousnessOrdinary Skill: To determine PHOSITA, consider – The education level of the inventor & active workers in the field;Type of problems encountered in the art;Prior art solutions to those problems;Rapidity with which innovations are made;Sophistication of the technologyEX: KSR - patent on connecting an adjustable vehicle control pedal to an electronic throttle control obvious b/c although they had never been combined, the existence of the technology would have caused any PHOSITA to see the obvious benefit in combining Exclusive Rights & Duration [§ 154]Patentee may:MakeUseSellOffer for SaleImportFor process patents – the product that results is also protectedIn the United StatesDuration = 20 years from date of applicationInfringement [§ 271]Literal Patent Infringement: violating any of the 5 exclusive rights in the U.S. within its term Procedure: compare claim to the accused product or process Must have ALL elements of at least one claim (i.e., if claim has 4 elements, accused product or process must have ALL 4)Types of Literal InfringementDirect infringement [§ 271(a)]: whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States, or imports into the United States any patented invention during the term of the patent therefor, infringes the patent. Strict liability the π need make no showing of intent, knowledge, or neglect of ?Inducing infringement [§ 271(b)]: whoever actively induces infringement of a patent shall be liable as an infringer (see Secondary Liability)Contributory infringement [§ 271(c)]: (see Secondary Liability)Exporting components to be assembled outside the U.S. [§ 271(f)]Violate if you supply all or a substantial portion of the components of a patent invention from the U.S., to actively induce the combo of those components outside of the U.S. in a manner that would infringe had it been done here.Overruled Deepsouth Packing: Substantial manufacture of the constituent parts of a machine does not constitute direct infringement given a combination patent protects only the operable assembly of the whole and not the manufacture of its parts Importing the product of patented process [§ 271(g)]Defenses to InfringementPatent InvalidityPatent is presumed valid [§ 282]Challenger must prove with clear & convincing evidence that the provisions of the Patent Act have not been satisfiedIf π did a post-grant opposition they could be estopped from claiming invalidityInequitable Conduct (fraud on PTO – hard to show)Intent to defraud the PTOKnew about something (specific intent)That was material (prior art is but-for material if the PTO would not have allowed a claim had it been aware of the undisclosed prior art)Purposefully withheldProof by clear & convincing evidence Prior Use [§ 273(b)(1)]For business methods pre-AIA; all other patents post-AIAAvailable if ?:In good faithActually reduced the subject matter to practiceAt least 1 year before the effective filing date of the asserted business method patent, andCommercially used the subject matter before filing date.? must prove with clear & convincing evidencePatent misuse: using your patent in order to force something that was not patentable.Doctrine of Exhaustion: repair of patented product is permitted while reconditioning or remanufacturing is not (see Exhaustion below).Design Patents [§ 171, 172, 173]§ 171: patents for any new, original, ornamental design for an article of manufactureElements:New (novel) Non-obvious (original)Ornamental not functionalDuration: protected for 15 years from date of grantClaims: entirely by illustration or pictureScope of Patent Protection If the patent design is primarily functional rather than ornamental, the patent is invalidHowever, when the article is ornamental AND functional, it is entitled to a design patent whose scope is limited to the ornamental aspects alone, and does not extend to any functional elements of the claimed article (e.g., ONLY consider the ornamental aspects when evaluating for infringement – the design aspects open to human view are protected)Richardson v. Stanley Works: Court held that from the perspective of an ordinary observer familiar with the prior art, the overall visual effect of the Fubar is significantly different from the Stepclaw ordinary observer would not be deceivedInfringementOrdinary Observer Test Egyptian GoddessRULE: If in the eye of the ordinary observer familiar with the prior art, giving such attention as a purchaser usually gives, two designs are substantially the same, and the resemblance is such as to deceive such an observer, inducing him to purchase one supposing it be the otherSubstantially the sameDeceive the observerDetermined in light of the prior art Procedure: compare patented articles side-by-side-2286006172200COPYRIGHT00COPYRIGHT** Ordinary observer test applied to both infringement and anticipation questionsINTRO TO COPYRIGHTSources of AuthorityConstitution: Art I, § 8, Cl. 8 -- Empowers Congress “to promote the progress of science and the useful arts, by securing for limited times to authors and Inventors the exclusive Right to their respective writings and Discoveries”Congress: Through Constitution, Congress granted power to protect copyrightCopyright Act of 1909: remained in effect for 68 years, and extended protection to “all writings of an author”56 years of protectionStill applies to works published BEFORE 1978 (valid until 2072)Dual System of Protection: State law protected a work before it was publishedOnce the work was published, state law was preemptedProper ? notice federal statutory protection w/ limited durationW/o proper notice work will be in public domainCopyright Act of 1976: unified law by extending federal ? protection to both published and unpublished works, commencing on the date the work is first “fixed” in tangible formTerm: Life of the author + 70 yearsEffective date: 1/1/1978 work created on or after date governed by new lawCodified in 17 U.S.C…§ 101: Definitions§ 102: Copyrightable subject matter§ 109: “For Sale” doctrineNature of CopyrightPurpose: to foster the creation and dissemination of intellectual works for the public welfare and to give authors the reward due to them for their contribution to society thus advancing “the progress of science and the useful Arts”Originally written for book, now pertains to musical, graphical, or artistic forms in which the author expresses intellectual conceptsThink about how the law pertains to books, and then consider something differentProcedure: In contract to patent, federal ? arises automatically, as a matter of law, as soon as qualifying work of authorship is fixed in tangible medium of expressionInfringement: prevents mere duplication, but encourages indp. creation of competitive worksSUBJECT MATTER OF COPYRIGHT [§ 102]17 U.S.C. § 102: (a) Copyright protection subsists, in accordance with this title, in original works of authorship fixed in any tangible medium of expression, now known or later developed, from which they can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device. Works of authorship include the following categories:Literary works;Musical works, including accompanying words;Dramatic works, including any accompanying music;Pantomimes and choreographic works;Pictorial, graphic and sculptural works; see “useful articles”Motion pictures and other audiovisual works;Sound recordings; AND ** ONLY IF RECORDED ON OR AFTER 2/15/1972Architectural works ** ONLY IF BUILT ON OR AFTER 12/2/1990(b) In no case does copyright protection for an original work of authorship extend to any idea, procedure, process, system, method of operation, concept [shunt these things to patent law field], principle, or discovery, regardless of the form in which it is described, explained, illustrated, or embodied in such workSummary: Copyright will be automatically granted under §?102, when a work of authorship is:Fixed in a tangible medium of expression [recorded in some permanent form]Original in order to qualify for federal ?Fixation [17 U.S.C. § 101]: recorded in some permanent form “Embodied in a copy or phonorecord… for which the work can be perceived, reproduced, or otherwise communicated, either directly or with the aid of a machine or device”A work consisting of sounds, images, or both, that are being transmitted, is fixed if it is being recorded simultaneously with its transmissionExamples:Live performance not fixedLive TV that is not recorded is not fixedData in RAM? As long as it is set for a duration of more than transitoryOriginality [Fiest]: (1) independently created, and (2) contains a minimal degree of creativity.“Works of Authorship” = intangible creations of the mindOnly modest creativity is needs, even selection and arrangement of public domain elements OKScope of ?: Facts are not copyrightable, but factual compilations may be eligible if it features an original selection or arrangement of facts, but the ? is then limited to the particular selection or arrangement. Compilation:Collection and assembly of pre-existing material, facts, or data;Selection, coordination, or arrangement of those materials, ANDThe creation, by virtue of the particular selection, coordination or arrangement of an “original” work of authorshipExemplary CasesBurrow-Giles Lithographic Co.: photo is copyrightable because it was staged = original mental conception by π including posing, costume, etc.Feist: the selection, coordination and arrangement of π’s white pages do not satisfy the minimum standards for ? protection – simply takes data provided by subscribers and lists alphabeticallyProtection of Expression vs. Idea [§ 102(b)]RULE: ? does not protect any idea, procedure, process, system, method of operation, concept, principle or discovery.Baker: book on unique method of accounting did not give rise to protection of use of system of accounting described b/c functional, not expressive codified at § 102(b)Blank Form Rule: not subject to copyright – blank forms, such as time cards, graph paper, account books, diaries, blank checks, scorecards, address books, report forms, order forms, and the like, which are designed for recording information and do not in themselves convey information Merger Doctrine: when idea and expression become inseparableIf there is only one way to express the idea, or it is necessary to the expression, then we leave that expression in the public domain so we are not protecting the idea. Herbert Rosenthal Jewelry: Bee pin not copyrightable because there was no other way to express the idea, even though the pins were substantially similar.If there are only a limited number of ways to express an idea, then Circuits are split in their approach:Majority: thin ? protection only applies to virtually identical copying or extremely close copyingMinority: limited numbers of ways to express an idea & none of them are protected (Morrissey – sweepstakes rules can only be described in a limited number of expression = not protectable)? in CharactersThe name of the character, by itself, is unlikely to be protectable under ? lawIf a literary character can be said to have a distinctive personality (protectable) when the behavior is relatively predictable so that, when placed in a new plot, it will react the sameCharacters possessing a visual as well as conceptual or literary aspect (i.e., cartoon or TV) may be more readily protected b/c of their more concrete delineation“Scenes a faire” Doctrine: ? does not extend to the incidents, characters, or settings that are, as a practical matter, indispensable or at least standard in the treatment of a given topic.Copyright in Useful Articles – “PGS” worksScope of Protection: The design of a useful article, shall be considered a pictorial, graphic, or sculptural work only if, and only to the extent that, such design incorporates pictorial, graphic, or sculptural features that can be identified separately from, and are capable of existing independently of the utilitarian aspects of the article.Separability can be either physical or conceptualPhysically Separable: if it can be physically separated from the article and stand alone as a work of art in the traditional senseConceptually Separable: apply BrandirBrandir: ribbon rack bike rack influenced significantly by utilitarian concerns = aesthetic elements not conceptually separableRULE: if design elements reflect a merger of aesthetic and functional considerations, the artistic aspects of a work cannot be said to be conceptually separable from the utilitarian elements. But, where design elements can be identified as reflecting the designer's artistic judgment exercised independently of functional influences, conceptual separability exists.If designed merged aesthetic & functional consideration not separableIf they did not merge consideration separable* Trier of fact (jury) determines whether aesthetic design significantly influenced by functional considerations§ 101 DefinitionsA “useful article” is an article having an intrinsic utilitarian function that is not merely to portray the appearance of the article or to convey information. An article that is normally a part of a useful article is considered a “useful article” (Mazer)“Pictorial, graphic, and sculptural works” include 2-D and 3-D works of fine, graphic, and applied art, photographs, prints and art reproductions, maps, globes, charts, diagrams, models, and technical drawings, including architectural plans.** Limits scope of ? in useful articles works shall be protected insofar as their form but not their mechanical or utilitarian aspects are concernedCopyright Formalities: Notice, Registration, Deposit & Duration (see handout)NoticeCopyright Act of 1909 – works published/registered before 1/1/1978Unpublished works protected by state common-lawOnce published, state law preempted & federal ? law protected works that had proper notice in the statutorily prescribed form & location [§ 401]Proper ? notice = ? + date of first publication + name of owner federal ? law protected with limited durationA single notice applicable to the collective work is sufficient Error in the name does not affect validity and ownership, less ? misledPublication: distribution of one or more copies of the work to the public; physically distributing tangible copies of the work to members of the publicLimited Publication: distribution of copies to a definitely selected group, for a limited purpose, and without the right of diffusion, representation, reproduction, distribution or sale (does not divest ?)EX: “Oscar” statute is not subject to general publication b/c only distributed to a selective group and never sold or distributedNo notice work will be in public domainJan. 1, 1978 – Mar. 1, 1989CRA of 1976 provided that federal ? would commence upon a work’s creation (rather than publication), and preempted state law for ? subject matter fixed in tangible formFixation is key dateStill required proper noticeMar. 1, 1989 – PresentNo notice requirement – had to relinquish in order to comply with the Berne Convention17 U.S.C. § 104(A): restores ? in works of foreign origin that were under ? in their source country, but were in public domain in U.S. due to failure to comply with formalities [notice or renewal], subject matter restrictions, or nationality restrictions.Registration [§§410-412]Permissive: ? arises automatically, and is not conditioned on registration. Reasons to registerPresumption of Validity [§410(c)]: Certificate or registration made before or within 5 years after first publication is prima facie evidence of the validity of the ? and of any facts stated in the certificate Infringement [§ 411(a)]: For U.S. works, registration (or unsuccessful attempt to register) is required in order to bring suit for infringementRemedies [§ 412]: No statutory damages or attorney’s fees if π failed to register ? before infringement, or For published works, failed to register within 90 days of first publication. Applies to foreign as well as U.S. works.Duration of Copyright and Renewal [§§302-305] – refer to handoutCategory of WorkDurationWorks created in 1978 or LaterIndividual authorLife of author + 70 yearsJoint WorkLife of last surviving author + 70 yearsWork made for Hire95 yrs from first publication OR 120 from creationAnonymous or Pseudonymous WorkSame as works for hireWorks created before 1978First published before 1923Public domainFirst published in 1923-1963Initial term of 28 years; renewal of 67 years, if properly renewedFirst published in 1964-77Initial term of 28 years; renewal of 67 years, renewal automatic.Created before 1978, but first published 1978-2002Same as First section, but shall not expire before Dec. 31, 2047Infringement (see handout)Definition: Doing any of the 5 exclusive rights without the permission of the ? owner, during the term of the ?, within the U.S. Elements: Ownership of a valid copyright;Copying; andImproper appropriationSteps of Analysis:Was there ownership of valid ??Was it verbatim copying or creating a derivative work?If verbatim, was there violation of any of the five exclusive rights?If derivative workWas there “copying”?Was there improper appropriation?Ownership of valid ?Π bears initial burden of production on the issues of ownership and validity. Π must intro sufficient evidence to establish:Originality + fixation (see above);Compliance with any formalities required for works created before 3/1/89;Registration (U.S. only); ANDOwnership (i.e., that π is the author, or received an assignment or exclusive license from the author or owner)Unlawful CopyingVerbatim copying: if obvious that two works are the same, you are merely trying to determine whether one of the exclusive rights was violated. Exclusive Rights [§ 106] – see definitions in § 101Reproduction: reproduced ? work in copies or phonorecords, new fixations. Adaptation: prepare derivative works (§101: recast, transformed or adapted)Distribution: distribute copies or phonorecords to public by sale or otherPublic performance (except sound recordings - below)Public display (n/a to PGS works)Exceptions & Limitations [§107-121]§ 114(b): Sound Recordings: Can only be infringed by literal copying or digital manipulation§ 117: Computer Programs (p. 530)Limits the exemption to copying that is an “essential step,” which means indispensible and necessary, not merely convenient. No more permanent than reasonably necessaryCourt rejected that § 117 only permits loading a program into a computer for the use its creator intendedLimitations on RightsFirst-sale doctrine [§ 109(a)]: notwithstanding the distribution right, the owner of a lawfully made copy may sell or otherwise dispose of that copy.Public-display right: owner of a lawfully made copy may, without authority of ? owner, display that copy publicly, either directly or by projection of not more than one image at a time, to viewers present at the place where the copy is located.Display of Useful Articles: ? may make and display pictures of a useful article in online advertisements for the sale of such articles.Derivative worksThe copyright owner has an exclusive right to prepare derivative works, or other works based on (“copied from”) the original work, that are substantially similar to the protected expression in the original work.If presented an alleged derivative work, then you must analyze whether it was in fact based on the original work, and if it is similar enough to be considered a derivative work, and thus violate the owner’s rights.Copying: not all copying is infringementΠ may prove copying, or that derivative work was “based on” original, by:Direct evidence: ?’s admission of copying or testimony of someone who saw; OR Circumstantial evidence: may be inferred from -Proof of access; ANDProbative similarity between ? work & infringing work; OR Proof of “striking similarity” may overcome lack of an independent showing of access, since one can infer access and copying if the works are virtually identical? may rebut presumption of copying with evidence of independent creation OR common source If ? intros such evidence, then it is left to the trier of fact to determine whether actual copying occurred. Improper appropriation: RULE: Requires proof of “substantial similarity” between the ?’s work and protected expression in the π’s work Determined by the jury according to the ordinary observer standard Ideas cannot be considered in analysis determine whether the “copied” portion was w/in the scope of π’s ? (See idea/expression) ASK: would the ordinary observer (or intended audience) of the work be inclined to over look any disparities and find the aesthetic appeal of the two works to be the same?If found, improper appropriation is under strict liability – no intent requiredNo appropriation:If ? has copied only unprotected expression (facts, ideas, “scienes a fare” – clichés of the genre, or public domain material), there is no infringementIf ?’s work has been so altered that it is not substantially similarMay be found in:Fragmented, Literal Similarity: verbatim copying of a portion of protected expression; ORComprehensive, Non-literal Similarity: non-literal copying of the pattern of structure of a work** NOTE: the similarity inquiry in determining copying in fact, is not the same as in determining “improper appropriation” and does not entail the same standard.Copying test may consider the entire work, including elements that are not protectedAppropriation only consider protected expressionCasesArnstein v. Porter: claim for music infringement at summary judgmentTEST: whether ? took from π’s work so much of what is pleasing to the ears of lay listeners, who comprise the audience for whom such popular music is composed, AND that ? wrongfully appropriated something that belonged to π.Hold: directed verdict improper questions of fact for jury determinationShaw v. LindheimSimilarity of ideas: test is objective similarity extrinsicSimilarity of expression: test is subjective similarity intrinsicMoral Rights Created in the Berne ConventionRight of attributionRight of integrity**U.S. has not adopted to provisions of the Berne Convention, except as provided in VARAVARA [17 U.S.C. § 106(A)]Covered Works: VARA grants right of attribution, integrity, and in the case of works of visual art of “recognized stature”, the right to prevent destruction.A “work of visual art” is a painting, drawing, print or sculpture, existing in a single copy, or in a limited edition of 200 copies or fewer. Excludes:Any poster, map, globe, chart, technical drawing, diagram, model, applied art, motion picture, or other audio-visual work (applied art: 2- and 3-D ornamentation or decoration that is affixed to otherwise utilitarian objects)Work made for hire: a work prepared by an employee within the scope of his or her employment“Recognized Stature” for visual work to be protected, π must show:The visual art in question has “stature” (i.e., viewed as meritorious); ANDThis statute is “recognized” by art experts, other members of the artistic community, or by some cross-section of societyRightsAttribution: the right of an artist to be recognized by name as the author of his work or to publish anonymously or pseudonymouslyIntegrity: allows author to prevent any deforming or mutilating changes to his work, even after title in the work has been transferred right to present the work the way you created itPrevent destruction: prohibits grossly negligent destruction of workCasesCarter v. Helmsley-Spear, Inc.: “walk-through” sculpture occupying building lobby was a work for hire and thus not protected.Martin v. Indianapolis: ?’s promised 90-day notice of removal, and failed to give it before destroying π’s work of recognized stature **only π to win under VARALanham Act § 43(a) Dastar Corp: Court held § 43 should be construed narrowly to avoid providing moral rights like protection to authors no right of attributionFair Use [§ 107] (see handout)17 U.S.C. § 107: Notwithstanding the provisions of sections 106 & 106A, the fair use of a ? work….for purposes such as criticism, comment, news reporting, teaching, scholarship, or research, is not an infringement of ?. Factors to be considered shall include:The purpose and character of the use, including whether such use is of commercial nature of is for nonprofit educational purposes;Transformative** vs. SupersedingTransformative: adds something new, with a further purpose of different character, altering the first with new expression, meaning or message.Superseding: merely reproductiveNon-profit vs. commercialEducational vs. entertainmentGood faith vs. Bad faith Furthers the goals of ?The nature of the ? work;Value of materials used Published vs. unpublished (greater protection soon-to-be published)Factual vs. Fictional (creative)** Fact that a work is unpublished shall not itself bar a finding of fair useThe amount and substantiality of the portion used in relation to the ? work as a whole;Reasonable in relation to the purpose of the copyingQuantitative: % of the work usedQualitative: importance of the portion used (did ? use the “heart of the work”)The effect of the use upon the potential market for or value of the ? work.Effect on potential market for the original AND licensed derivativesMarket for potential derivatives includes those that creators original work would in general develop or license others to developConsider price/type of market (e.g., hand-crafted vs. mass-produced)CasesHarper & Row: unauthorized use of quotations from a public figure’s unpublished manuscript is not a fair useCampbell v. Acuff-Rose Music: parody of “Oh, Pretty Women”Rule: threshold question when fair use is raised in defense of parody is whether a parodic character may reasonably be perceived. Whether, going beyond that, parody is in good taste or bad does not and should not matter to fair use (tarnishment n/a).Parody: a “literary or artistic work that imitates the characteristic style of an author or a work for comic effect or ridicule”Satire: needs greater justification to be a fair use.Related State Rights – “Idea Law”Purpose: state laws protecting things not protected by federal ? law must check whether the state causes of action are “preempted” Theories to Recover: ContractExpressImplied-in-factUnsolicited submission, involuntarily received no KUnsolicited submission, voluntarily received if the recipient at the time of disclosure understands that the idea person expects to be paid for the disclosure of the idea, and does not attempt to stop the disclosure, inaction may be seen as consent to a contract.Solicited submission creates prima facie evidence of KQuasi-contract (unjust enrichment) – Reeves A benefit conferred upon the ? by the π;Appreciation by the ? of such benefit; ANDAcceptance and retention by the ? of such benefit under such circumstances that it would be inequitable for him to retain it without paying the value thereofProperty theory: Courts may recognize property rights in an idea that is novel and concreteNovel – courts differ:Original to πInnovative in characterNonobviousOriginal to π AND innovative in characterConcreteness:Reduced to some tangible form Sufficiently or fully-developed, completed, fleshed-out in detail and ready for immediate implementationMisappropriationA form of unfair competition that was first enunciated in INS c. Associated Press** Most claims are preempted by federal copyright lawTort vs. Contract Issue:NY requires impact on the “incentive” of the first partyMany cases require “direct competition”A few cases follow Board of Trade and don’t require eitherElements for Misappropriation:Π has invested time, money, skill or labor to create an intangible trade value (sweat of the brow);? has appropriated that intangible trade value in a manner that can be characterized as “reaping where it has not sown” or taking a free ride; ANDπ has suffered injury as a resultCasesBoard of Trade of Chicago v. Dow Jones: misappropriation of π’s index even though no direct competition and π had not planned to license, but valuable assets United States Golf Assn. v. St. Andrews: golf handicap formula not protectedIndirect competition of this sort falls outside the scope of the misappropriation doctrine, since the public interest in free access outweighs the public interest in providing an additional incentive to the creator or gatherer of information-2286005715000TRADEMARK00TRADEMARKIntro to TrademarkSources of AuthorityConstitution: Not based on its own constitutional provision authority found in the interstate commerce clauseFederal Law: Lanham Act § 43(a) -- registered and unregistered TM; 15 U.S.C. ___State law: not preempted – common lawTypes of Marks [15 U.S.C. § 1127]: Lanham Act recognizes and authorizes registration of four different types of marks: Trademarks [Lanham Act § 45/ 15 U.S.C. § 1127], Service marks, Certification of marks, and Collective marks. What is Trademark?Any word, name, symbol or device used to identify and distinguish the goods or services of one business from those of anotherProtects consumers and competition by protecting the labels that identify competing goods and servicesDistinctiveness Requirement (see handout)Abercrombie v. Hunting World created the four mark designation, best suited for word marksInherently Distinctive Marks – may be registered w/o any evidence of distinctiveness Fanciful: words invented solely for their use as trademarks and have no other meaning (i.e., Kodak, Exxon)Arbitrary: marks are existing words applied in an unfamiliar context (i.e., apple for computers, Starbucks for coffee). Arbitrary and fanciful marks receive the greatest protectionSuggestive: words that are suggestive of some quality or characteristic of goods or services. Requires imagination, thought or perception to reach a conclusion as to the nature of the goods (i.e., Coppertone for suntan lotion, Klondike for ice cream bars)Descriptive Marks – not inherently distinctive goods or services are not eligible for registration unless and until it acquires “secondary meaning”Descriptive: term is descriptive if it immediately conveys an idea of the ingredients, qualities, or characteristics of the goods or services (i.e., American Airlines, Coca-Cola), or is a personal name.Secondary Meaning: public has come to view the term primarily as a mark, or as the brand of a particular producer of goods/services (second in time)Exists only if a significant number of prospective purchasers understand the term, when used in connection with particular goods or services, not merely in its descriptive sense, but primarily as an indication of association with a particular, even anonymous, source.Factors relevant to secondary meaning include:Consumer testimony and surveys (direct evidence); Amount and extent of advertising;Volume of sales; andLength and manner of use (circumstantial evidence).Generic Terms – cannot be the subject of trademark protectionIdentify the class or type of product rather than a particular brandA distinctive mark may become generic in the perception of the public and lose protection (Murphy Door Bed). Factors relevant to genericism:Consumer testimony and surveys;Dictionary definitions;Media usage;Third-party usage;Availability of generic alternative; andEfforts of trademark owner to police usage.Trade Dress [§ 43(a)/ 15 USC § 1125]Definition: when the appearance of a product or its packaging come to recognize a sourceLanham Act gives a producer a cause of action for the use by any person of any word, term, name, symbol, or device, or any combo thereof, which is likely to cause confusion as to the origin, sponsorship, or approval of his or her goods.Trade dress constitutes a “symbol” or “device” Trade Dress (Two Pesos): the total image of a product or service OR business.Π’s trade dress includes the shape and generic appearance of the exterior of the restaurant, identifying sign, interior kitchen floor plan, door, menu, etc.Trade dress that is inherently distinctive does not require a showing of secondary meaning.Elements for Trade Dress Protection:Identifying mark is distinctive and capable of being protected if it is either:Inherently distinctive; ORHas acquired distinctiveness through secondary meaningTrade dress is non-functional; ANDThere is proof of the likelihood of confusionCategories of Trade DressProduct Packaging: the way the producer packages its productsRULE: Since choices that a producer has for packaging its products are almost unlimited, typically a trade dress will be arbitrary or fanciful and therefore inherently distinctive, UNLESS it is the custom of an industry to package products in a particular manner.Paddington Corp: Ouzo bottle design was inherently distinctive because there was no evidence in industry of packaging design and nothing descriptive about the bottle.Product Feature: distinguishing through the appearance of products themselvesRULE: for infringement of unregistered trade dress, a product’s design is distinctive and therefore protectable only upon a showing of secondary meaning.Wal-Mart v. Samara Bros: limited Two Pesos to product packaging design and configuration cannot be inherently distinctive b/c not used to identify a sourceColorsColors cannot be inherently distinctive, but may be valid if mark has “acquired distinctiveness” or sufficient secondary meaning.Qualitex: green gold laundry press padsRule: a color may be a trademark if it satisfies requirement that a person “use” or “intend to use” the mark to identify and distinguish his or her goods, including the unique product, from those manufactured or sold by others and indicate the source of the goods, even if that source is unknown (i.e., has secondary meaning).Limits: if the color serves a purpose or is functional Might be functional if color is the result of the chemical included and they are requiredEX: Peptobismal (pink color ID’s substance)Sounds – Ok Smells – only protected if non-functionalNon-Functionality The person who asserts trade dress/ mark protection has the burden of proving that the matter sought to be protected is not functional – or not an important part of what consumers want.RULE: a product feature is functional and cannot serve as a trademark if it is:Essential (essence of a thing) to the use or purpose of the article; ORIt affects the cost or quality of the article; ORAlternatively, if the exclusive use of the feature would place competitors at a disadvantage that is not related to reputation – cases of aesthetic functionality. (e.g., consumers wanting to buy shoes with red soles b/c they are attractive, not b/c they are source-identifying – 2013 exam)Traffix: the dual spring design is not an arbitrary flourish, but the reason the device works.2013 Louboutin: if the red outsole makes the shoes more likely to attract the attention of others, then it serves a functional purposeAcquisition of Rights in MarksRights may be obtained by:Use, orRegistrationCommon-Law Use Requirement (applies to both registered and unregistered marks)RULE: First person to appropriate and use the mark in interstate commerce gets priority. Use: Mark must be fixed to the goods or associated with the service, sold or offered for sale in the market, and must make a reasonably continuous use after first appearance.Has to be bona fide use in trade – cant be internal shipment of used for the sole purpose of trademark protectionCommon law protection is limited to:The types of goods and services and related goods and services;The geographical area the mark is used and the natural area of expansionBlue Bell: π’s attachment of a secondary label to an older like of goods illustrates bad faith attempt to reserve the mark, not a bona fide use.Federal RegistrationApplications Based on Use and Intent to Use in CommerceLanham Act § 1/ §45/ 15 U.S.C. § 1051Two procedures for registering:Original method based on the use of the mark in commerce (see above); ORIf mark is inherently distinctive, may register based on a bona fide intent to use the mark in commerce (“intent to use applications”)Use in Commerce: the bona fide use of a mark in the ordinary course of trade and not made merely to reserve a right in the markIf granted, gets notice of allowances – have 6 months to file affidavit of use to prove usage. Filing date is retroactive.Must be using mark in interstate commerce – not much of limitationRenewal: 5 years 10 years Every 10 years afterApplications Pursuant to International Treaty ProvisionsParis convention (p. 827)Why register?Presumption of validityFreeze your rights in timeNationwide rights (Cf: common law protection)IncontestabilityCustoms and border protectionCan’t obtain $$ damages if not registered and ? labeled (TM = no legal significance)Nation-Wide RightsIn general, registrant has nation-wide rights as of the date you filed applicationException: Any common law right that existed at the time the application was filed (c/l rule limited to geo area where mark is used)§ 33(b)(5) “Limited Junior User ?se” - that the mark whose use by a party is charged as an infringement was (1) adopted w/o knowledge of the registrant’s prior use and (2) has been continually used by such partyRights are limited to geographic area where the mark is used registrant has all other nation-wide rightsDawn Donut Rule: the senior user is only entitled to an injunction if/when there is a likelihood of confusion in the geo-area of junior user, but not before.Incontestability: if mark has been registered for 5 consecutive years w/o any successful challenges, then you can get a certificate that mark is “incontestable,” BUT mark may still be challenged on 9 grounds (but only those 9 defenses alone)Mark cannot be challenged for lacking secondary meaningCannot be challenged for conflict w/ pre-existing marks (senior user)Trademark Infringement [§ 32 - registered marks, § 43(a)(1)(A) – unregistered mark/trade dress]Steps of AnalysisIs there ownership of a valid trademark?Mark passes distinctiveness requirement – common law; and/orMark is registered and presumed valid, giving owner enumerated rightsIs there a likelihood of confusion on an appreciable # of prospective purchasers?Ownership of Valid MarkStandard is the same for registered and unregistered marks, except for the BOP:Registered = ? has BoPUnregistered = π?has BoPConsider:The common law distinctiveness requirements (above); andIf the mark is unregistered, π must prove validity of markIs the mark functional?Whether the mark is registeredIf registered, the mark is presumed valid and ? has BoP to prove mark is invalidMark may be incontestable, but ? can prove invalid in 9 ways [see § 33(b)]Likelihood of Consumer Confusion (see handout)RULE: Use of a similar mark on another’s goods or services will constitute infringement if it is likely to cause confusion, mistake, or to deceive as to origin, sponsorship, or approval of goods or services, or as to affiliation, connection, or association with the mark owner. Cannot be a mere “possibility” of confusion. Consider these 8 factors in determining likelihood of confusion: Strength of the markProximity/ relatedness of the goodsSimilarity of the marks**IF YOU HAVE TOP THREE, COURT WILL FIND LIKELIHOOD OF CONFUSIONEvidence of actual confusionMarketing channels usedTypes of goods and the degree of care likely to be exercise by the purchaser?’s intent in selecting the mark; andLikelihood of expansion of the product linesEvaluating FactorsStrength of Mark: consider distinctiveness of the senior user’s mark (apply distinctiveness factors), and evidence of secondary meaning:Length of use;Volume of sales;$$ spend on advertisingRelatedness of GoodsDefine the relevant market: class of prospective purchasers for the goods and services. Π must show an “appreciable number of ordinarily prudent purchasers” are likely to be confused.Also consider:Nature of the products;Price;Whether the goods substitute for one another;Whether the products are complementary (used together); andWhether producers typically do/don’t produce both products.Similarity of MarksConsider similarity in sight, sound, and meaning in the context of the marketplace. The presence of absence of other distinguishing matter or trade dress may affect similarity.Evidence of Actual ConfusionEvidence of actual confusion is strong evidence of likelihood of confusion (i.e., person writes to company saying they thought it was something else). Lack of actual confusion is probative only if the products have co-existed in the market for a period, otherwise, it is excused.Consumer surveys are relevant, but side-by-side surveys are suspect.Similarity of Marketing Channels: Consider how the goods or services are sold to consumers:Methods of sales;Location of sales; and Type of advertising used by both parties.Type of Goods/Degree of Purchaser Care:Confusion more likely where:Goods are relatively inexpensive;Impulse purchase, to which average unsophisticated consumer does not devote great deal of care or consideration in purchasing.Confusion less likely where goods are:Relatively expensive;Consumer are sophisticated and knowledgeable; andConsumer’s exercise a great deal of care in determining whether the purchase.Intent: consider intent of the junior used in adopting mark.If the junior user intended to confuse consumers, court will presume success in achieving that intent.Courts often infer intent to confuse from evidence that junior user adopted an identical or very similar mark with knowledge of the prior use, particularly where the senior user’s mark is well known.Likelihood of Expansion: consider if there is a strong possibility that either party will expand its business to directly compete with the other.In addition to likelihood of confusion as to origin, sponsorship, or approval, may also consider initial interest confusion, reverse confusion, and post-sale confusion.Reverse confusion: junior user is so much larger or more famous than the senior user, or so extensively promotes its mark, that it overshadows the senior user, leading consumers to think that the senior user’s good come from the junior userInitial Interest: at the time you purchased the goods you were not confused, but you might have been confused into doing business with mark owner before transaction (Rolex sign in window, store doesn’t sell Rolex? watches)? uses same name or ???intentionally makes name appear higher on search through metatags Keyword advertisingPost-Sale: confusion in secondary markets - generally in cases of counterfeiting this likelihood of confusion may serve as the basis for infringementCasesSleekcraft: Slickcraft vs. sleekcraft boats ? infringed mark and limited injunction grantedBrookfield: federal law may prohibit infringer from using trademark in its (1) domain name, or (2) its website metatags. Network Automation: keyword search use did not show likelihood of confusionDefenses to InfringementExhaustion (see below)Fair Use [§ 33(b)(4)/ 15 U.S.C. § 115(b)(4)]Descriptive: A use, otherwise than as a mark, of the ?’s individual name in his own business, or of the individual name of anyone in privity with the ?, or of a term or device which is descriptive of and used fairly and in good faith only to describe the goods or services of the ?, or their geographic originCourts undertake to determine what the ?’s likely purpose was in using the contested word or symbol. Factors to consider:How ? employed the word or symbol- its prominent, style, and placements on the ?’s labels, packaging or advertising;Whether ? has emulated the π’s style of presenting the mark or the π’s packagingWhether ? prominently displayed his own, differentiating mark;The relevance and accuracy of the word or symbol’s primary meaning in describing the ?’s product or service; andWhether the ? took precautionary measures to avoid consumer confusion.KP Permanent Make-Up: π bears the burden of demonstrating a likelihood of confusion by a preponderance of the evidence; OR, ? asserting fair use does NOT have the burden of negating any likelihood that the practice complained of will confuse consumers about the origin of the goods or services affected.Nominative: The nominative fair use doctrine permits such referential use of π’s mark, as long as the use “does not attempt to capitalize on consumer confusion or to appropriate the cachet of one product for a different one”Use for Comparison: In the absence of misrepresentation or confusion as to course or sponsorship, a seller promoting his own goods may use the ? of another to identify the latter’s goods (Smith v. Chanel - Selling knock-off perfumes OK promotes competition)Factors to determine whether the ?’s use is non-infringing nominative fair use (New Kids):The π’s product must not be readily identifiable without use of the mark;Only so much of the π’s mark may be used as is reasonably necessary to identify the π’s product; andThe ? must do nothing that would, in conjunction with the mark, suggest sponsorship or endorsement by the trademark holder.When ? raises the nominative fair use defense, these factors should be used INSTEAD of the likelihood of confusion test from Sleekcraft.This analysis is appropriate where a ? has used the π’s mark to describe the π’s product, even if the ?’s ultimate goal is to describe his own productTrademark Dilution [§ 43(c)]Dilution: gradual whittling away or dispersion of the identity and hold upon the public mind of the mark or name by its use upon non-competing goods. Elements:The owner of a famous mark that is distinctive;? commences use of mark long after it became famous;? uses mark in interstate commerce;The use is likely to cause dilution by blurring, OR dilution by tarnishmentFame: a mark is famous if it is widely recognized by the general consuming public of the US as a designation of source of goods or services of the mark’s owner. Factors to consider:The duration, context, and geographical reach of advertising and publicity of the mark, whether advertised or publicized by the owner or third parties;The amount, volume, and geographical extent of sales of goods or services offered under the mark;The extent of actual recognition of the mark; andWhether the mark was registered under the Act of March 3, 1881, or the Act of Feb 20, 1905, of on the principal register.Dilution by Blurring: association arising from similarity that impairs the distinctiveness of the famous mark and may be found regardless of the presence of absence of actual or likely confusion, competition, or of actual economic injury. Six factors to consider (Starbucks – “Charbucks” dark coffee = no blurring despite obvious pun on π’s name – must be harm to ‘s mark): Degree of similarity between the mark and the famous mark (how they are perceived in market);Degree of inherent or acquired distinctiveness of the famous mark;Extent to which the owner of the famous mark is engaging in substantially exclusive use of the mark (no evidence of other non-infringing uses);The degree of recognition of the famous mark;Whether ? intended to create an association with the famous mark;Degree of actual association between ?’s mark or trade name and the famous mark.Dilution by Tarnishment: association arising from a similarity that harms the reputation of the famous markA mark may be tarnished when it is linked to products of shoddy quality, or is portrayed in an unwholesome or unsavory context, with the result that the public will associate the lack of quality or prestige in the ?’s goods with the π’s unrelated goods.VS Catalogue: there is a rebuttable presumption, or a very strong inference, that a new mark used to sell sex-related products is very likely to tarnish a famous mark is there is a clear semantic association between the twoPresumption of harm that if you use ? with suggestive materials burden shiftsInference must be overcome by evidence that rebuts the probability that some consumers will find the new mark both offensive and harmful to the reputation and the favorable symbolism of the famous markDefenses to Dilution Any fair use (see above)§ 43 (c) excludes any fair use of a famous mark by another person other than as a designation of source.Imports doctrine of exhaustion into statuteMay include trademark use: ? was using π’s mark as a mark for its own goods or services, rather than on π’s own refurbished goods.News advertising; orAny noncommercial use of a mark [§ 43(c)(3)(C)] commercial = does no more than propose a commercial transaction.** federal registration of a mark will bar any state claim that the mark dilutes or otherwise harms the distinctiveness or reputation of a mark, label, or form of advertisement.Relief is limited to an injunction, unless π can demonstrate:? first used its diluting mark in commerce after the TDRA of 2006 was enacted; ORThat the ?’s acts were willful:Blurring: if ? willfully intended to trade on the recognition of a famous mark;Tarnishment: if ? willfully intended to harm the reputation of the famous markIf π can demonstrate (1) or (2), it can recover $ for profits, costs, and atty fees.False Claims [Lanham Act § 43/ 15 USC § 1125]Statute: (a)(1) Civil Actions: Any person who…uses in commerce any word, term, name, symbol, or device, or any combination thereof, or any false designation of origin, false or misleading description of fact, or false or misleading representation of fact, which -(A) False designation of origin: is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person, or(B) False advertising: in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person’s goods, services, or commercial activities…liable to any person who believes that he/she is likely damaged.Lexmark Int’l: to come within the zone of interest in a suit for false advertising, a π must allege an injury to a commercial interest in reputation or sales.False Designation of Origin“Origin of goods”- refers to the producer of the tangible goods that are offered for sale, and not to the author of any idea, concept, or communication embodied in those goods (not misattribution).Dastar: the origin of tangible product sold in the marketplace was ?, who physically produced The Campaign videotape sold, which was edited from WWII series π had lost ? protection to.“Passing Off” occurs when the producer misrepresents someone else’s goods or services as his own.“Reverse passing off” = using your own ? on the π’s goods or servicesFalse Advertising [§ 43(a)(1)(B)]RULE: If the π seeks actual damages based on its lost sales, it must demonstrate actual customer reliance on the false advertisement. If π seeks an injunction, they must show:?’s false or misleading statement of fact in advertising about its own product;The statement actually deceived or had the capacity to deceive a substantial segment of the audience;The deception was material, in that it was likely to influence the purchasing decision;The ? caused its goods to enter interstate commerce; andThe π has been or is likely to be injured as a result.False Statements: If a statement or representation that is literally or explicitly false, the court may grant an injunction without reference to the advertisements impact on the buying public Implicitly False: If an advertisement is misleading, confusing or deceiving, it’s tendency to violate the act should be tested by public reaction.Non-Comparative Advertising: Johnson & JohnsonFacts: ? put baby oil in Nair and π sued alleging ad falsely represents Nair has moisturizing and softening effects. This involved misleading, non-comparative commercials, which made no direct reference to any of π’s product.Held: π must demonstrate a reasonable basis for the belief that the π is likely to be damaged as a result of the false advertising.** § 43 expanded common law because it: (1) does not require proof of intent to deceive; and (2) entitles a broad range of commercial parties relief.False Comparative Advertising - McNeilab: by falsely implying that Advil is as safe as Tylenol in all respects, ? deprived π of a legitimate competitive advantage and reduced consumers’ incentive to select Tylenol rather than Advil. Right of PublicityCommon Law Right: the natural right of a person to use his/her name or likeness, or other indicia of identity, for commercial purposes (s/a advertising or merchandising)Owned by natural persons and not corporationsName, likeness or other indicia of their identity (White v. Samsung) – use of π’s identity for ?’s (commercial) advantage w/o consentDurationLasts for the life of the personPost-mortem rights – split in states:If seen as personal right not assignable or descendibleIf property right assignable, not descendibleCA = Life + 70 years (California Celebrities Rights Act of 1986 made inheritable)NY = 0 yearsDefensesFirst-sale doctrineNewsworthiness-2286005372100COMMON THEMES IN IP00COMMON THEMES IN IPParodyFirst Amendment: a transformative use is protected by 1A (from ? fair use doctrine)OwnershipOwnership of Trade Secrets Created by EmployeesRULE: if the employee maintains a specific inventive employment relationship, then the employer is deemed the inventor of the trade secret. However, when the employee maintains a non-inventive employment relationship, they may be deemed the inventor. Specific inventive: employee is (1) hired to invent a specific invention; or (2) is assigned the task of making a specific invention or improvement to existing technology. General inventive: encouraged by employers to pursue creative instincts, but no specific invention or end result is contemplated. Factors to consider:Nature and scope of employment relationship;Amount of $ or other resources the employer devoted to the inventive activity;How closely the employee’s invention is related to the employer’s business;Whether the employee has assigned inventions to the employer in the past;Any other evidence of an implicit understanding between the parties about the ownership of inventions.Non-Inventive: invention is not related to the job; its now what you were hired to do because there was no expectation of inventive activityShop Rights: If employee is the inventor, the employer gets a shop rightIt is an irrevocable, non-exclusive, non-assignable right to use the trade secret, without obligation to pay royaltiesShop right may arise if it is related to the employer’s business and the employee, in developing it, used her employer’s time, facilities, personnel, materials, money or other resources.Express Assignment Provisions: many employers require employees to sign advance assignment agreements that assign the employer rights in any inventions they made during their employment.RULE: Express assignment provisions are generally enforced, as long as the inventions have some reasonable relationship to the employer’s business and do not extend unduly beyond the period of the employee’s employment.In CA, non-inventive relationships cannot assign inventions through contract before invention is made.Ownership of PatentsRULE: Under AIA, inventor must be a natural person and be identified in the patent, although you may assign the rights to the employer.Joint Inventors [35 USC § 262]RULE: when an invention is made by two or more persons:Each person must have contributed to the final concept of the invention;Each must make a contribution to the claimed invention that is not insignificant in quality, when that contribution is measured against the dimension of the full inventionInventors must have collaborated.In the absence of any agreement to the contrary, each of the joint owners of a patent may make, use, offer to sell, or sell the patented invention within the US or import the patented invention WITHOUT the consent of and without accounting to the other ownersOwnership of Copyright [17 USC § 201]Author: the person who conceives of the copyrightable expression and fixes or causes it to be fixed in tangible form.Work Made for Hire: the employer of other person for whom the work was prepared is considered the author. If a work is made for hire, the employer is the author and owns ?, unless there is an agreement to the contrary.A work for hire can arise two ways [17 USC § 101]:Work prepared by an employee w/in scope of employment (from employee vs. contractor distinction); ORA work specially ordered or commission for use as [nine categories] if the parties expressly agree in a written instrument signed by them that the work shall be considered a work made for hireTo determine whether prepared by an employee or an independent contractor apply the common law of agency, considering the hiring party’s rights to control the manner and means by which the product is accomplished. Factors to consider:Skill required;Source of instrumentalities;Location of work;Duration of relationship;Whether the hiring party can assign other projects;Extent of hiring party’s discretion over when and how long to work;Method of payment (salary vs. one-time)Hiring party’s role in hiring and paying assistants;Whether the work is part of regular business of hiring party;Whether hiring party is in business;Provision of employee benefits; andTax treatment of hired party.Joint WorksStatute: To be a “joint work” there must be:A copyrightable work;Two or more “authors,” The authors must intend their contributions to be merged into inseparable or interdependent parts of a unitary whole.Additional Requirements:Each author must make an independently copyrightable contribution; andBoth authors must intend to be joint authors, in that both:Exercise creative controlObjectively manifest shared intent (credit), andAudience appeal of work turns on both contributorsConsequences of Joint WorkEach joint author owns an equal, undivided interest in the copyright, regardless of the magnitude of contribution actually made to the workEach author has to the right to exploit the work herself, and grant non-exclusive licenses to others, subject only to an accounting to the other co-owners for any profits she makes.All co-owners must agree to assign the copyright or to grant exclusive licenses.Collective works [§ 201(c)]Definition: work, s/a a periodical issue, anthology, or encyclopedia, in which a number of contributions constituting separate and independent work themselves are assembled into a collective work.Absent an express K, the owner of copyright in the collective work is presumed to have acquired only the privilege of reproducing and distributing the contribution as part of that particular collective work. (i.e., the ? in each article is owned by the authors, while there is a separate ? in the collective work as a whole, owned by the publisher)Divisibility and Transfer of Ownership: [§ 201(d)]: Any of the exclusive rights that go to make up a copyright, can be transferred and owned separately. Even if the transfer is limited in time or place of effectAny transfer of exclusive right must be in writing and signed by the transferor or his agent.There is no implied transfer of copyright ownership, but non-exclusive licenses may be granted by implication if:Licensee requested the creation of the work;The licensor (creator) makes that particular work and delivers it to the licensee who requested it, andThe licensor, at the time of creation and delivery, intends that the licensee-requestor copy and distribute his work. Factors showing intent:Whether the parties engaged in short-term discrete transactions as opposed to an ongoing relationshipWhether the creator utilized written K providing that copyrighted materials could only be used with his future involvement or express permissionWhether the creator’s conduct during the creation or delivery indicated that use of the material without his involvement or consent was permissibleCreates an unlimited, non-exclusive license to retain, use and modify.If for consideration, license is irrevocable.Exhaustion/First SalePatent – Common Law RightDefinition: Once the patentee releases a patented product into the stream of commerce by selling or authorizing it to be sold to another, he exhausts his legal right to control that product. The first purchaser, and those deriving title from her, may use and resell the product at will.Method patents are exhausted by the sale of an item that embodies the method. RULE: exhaustion following the sale of an item applies when the item sufficiently embodies the patent – even if it does not completely practice the patent – such that its only and intended use is to be finished under the terms of the patent.Quanta Computer: because Intel was authorized to sell its products to ?, exhaustion prevents π from asserting patent rights over the chips that substantially embody the patent essential features of the method patent.Contracting Around ExhaustionPatentees can counteract the effect of exhaustion through express contractual provisions restricting the purchaser’s subsequent use or resale of the patented articleIf you violate the express provision of a license, you may be liable for patent infringement or breach of contract.Repair vs. ReconstructionRepair: The right to use and resell a patented article, which a purchaser and his successors obtain by virtue of exhaustion, encompasses the right to repair. RULE: only when repair amounts to reconstruction, is there an unauthorized making or second creation of the patented invention, which constitutes infringement.Four factors assist in the determination of whether the original product was “spent” so that purported “repairs” in fact constituted infringing reconstruction:The nature of the actions taken by the ?;The nature of the device and how it is designed (whether one of the components of the patented combo has a shorted useful like than the whole);Whether a market has developed to manufacture or service the part at issue; andObjective evidence of the intent of the patentee.Experimental UseThe making of a patented machine to be an offense must be the making with an intent to use for profit, and not for the mere purpose of philosophical experiments, or to ascertain the verity and exactness of the specification.Imported Goods Parallel imports are goods that are sold or authorized for sale abroad by the U.S. IP owner, but are subsequently imported into the US without the IP owner’s authorizationDomestic: only exhausted by articles manufactured and authorized for sale in USFed. Circuit = domestic exhaustion onlyJazz Photo: disposable camera re-manufacture (putting in new film) OK as long as sold in US domestically. If sold outside US, then would violate import right.International: exhausted by an authorized sale of the item anywhere in the world, so long as US patent owner has authorized, then it can be imported and resold in US.Copyright Doctrine of First Sale (codified at § 109)RULE: Once the work is lawfully sold or even transferred gratuitously, the copyright owner's interest in the material object in which the copyrighted work is embodied is exhaustedOne who buys a copy of a book is entitled to resell it, rent it, give it away, or destroy it. The owner of the copy of the book will not be able to make new copies of the book because the first-sale doctrine does not limit copyright owner's reproduction rightSoftware: digital goods are treated differently, as users are considered “licensees” not owners. Therefore, if you buy a CD – that is tangible and you can sell, but downloading on iTunes acts as a license, not ownership, of song. Parallel Imports § 109(a) – “lawfully made under this title” does not place geographical limitation. Doesn’t matter where work was made, if it was lawful under the standards of US law (with authorization of ? owner), then buyer can bring it back into US and sell it here and it is exhausted (Kirtsaeng).§ 602: importation rightTrademark RULE: once the mark owner permits goods bearing its mark to enter the stream of commerce, it generally cannot prevent or control resale of the goods with the mark, or truthful advertising of goods bearing that mark for sale.Repair: when the mark is used in a way that (1) does not deceive the public, and (2) the manufacturer is not identified with inferior qualities of the product resulting from wear and tear or reconditioning by ?, then ? can use π’s mark (Champion Spark Plug). The ? must clearly and distinctively sell item bearing π’s mark as repaired or reconditioned, rather than as new.BUT, where the recondition or repair would be so extensive or so basic that it would be a misnomer to call the article by its original name, (i.e., new design) may be infringement. Parallel Imports (Tariff Act § 526, 19 USC § 1526)RULE: It shall be unlawful to import into the United States any merchandise of foreign manufacture if such merchandise, or the label, sign, print, package, wrapper, or receptacle, bears a trademark owned by a citizen of, or by a corporation or association created or organized within, the United States, and registered in the Patent and Trademark Office by a person domiciled in the United States, …, unless written consent of the owner of such trademark is produced at the time of making entry. Congress intended to provide a remedy only to domestic ? holders who is injured by the distribution of like goods.19 CFR § 133.21: restrictions n/a if not applicable – Both foreign and US trademark or trade name are owned by the same person or business entityBoth foreign and US trademark/ trade name owners are parent and subsidiary companies or are otherwise subject to common ownership or control.19 CFR § 133.23: Custom service will stop physically and materially different goods bearing a genuine mark applied under the authority of the US mark owner or its affiliate, unless it is clearly marked.** This codified Weil Ceramics: if foreign ? owner and domestic ? have common ownership & control, then international exhaustion. If not, then domestic exhaustionSecondary LiabilityCommon ElementsStep One: π pleads and proves direct infringementStep Two: three doctrinesContributory InfringementPatent - § 271(c)Copyright and Trademark – case law (court has borrowed § 271(c))InducementPatent - § 271(b)Copyright - Vicarious LiabilityPatent [defined by statute § 271(b) – (c)]Step One: π pleads and proves direct infringementStep Two: Three options - Inducement [§ 271(b)]: “Whoever actively induces infringement of a patent shall be liable as an infringer.”Specific intent required: (1) knowledge of the patent, and (2) knowledge of infringement. π must show that the alleged infringer’s action induced infringing acts AND that he knew or should have known his actions would induce infringement.DSU Medical Corp: no induced infringement – although ??knew of π’s patent, ? had advice of attorneys that it did not infringe, therefore no knowledge that their actions were infringing.Global-Tech Appliances: same knowledge of the existence of the patent that is infringed is needed for induced infringement. Contributory Infringement [§ 271(c)]: Whoever offers to sell or sells within the United States or imports into the United States a component of a patented machine, manufacture, combination or composition, or a material or apparatus for use in practicing a patented process, constituting a material part of the invention, knowing the same to be especially made or especially adapted for use in an infringement of such patent, and not a staple article or commodity of commerce suitable for substantial non-infringing use, shall be liable as a contributory infringerElements:? sold or offered to sell or imports the infringing componentsThe infringing components had no substantial non-infringing use;? engaged in conduct within the US that contributed to another’s direct infringement;A third party engaged in actual acts of infringementDefined narrowlyKnowledge may be met by willful blindness (see below)Intent requirement same for (b) and (c): ? must have actual knowledge of (1) the patent, and (2) that he was infringing.Knowledge may be equated with willful blindness: ? must subjectively believe that there is a high probability that a fact exists, and must take deliberate actions to avoid learning of that fact.Good faith belief that patent is invalid does not shield you from inducementGlobal-Tech Appliances: although ??had hired attorney to look for prior art, ? did not tell him they had coped fryer directly from π’s product.** May not believe you are infringing if you employ a different claim construction than the patent holder.Copyright (common law)Vicarious Liability: Even in the absence of an employer-employee relationship, one may be vicariously liable if:He has the right and ability to supervise [control] the infringing activity; and Has direct financial interest in such activities.Contributory Infringement: one who, with knowledge of the infringing activity, induces, causes, or materially contributes to the infringing conduct of another, may be held liable.CasesFonovisa v. Cherry Auction: ?, who owned flea market and knew vendors were selling counterfeit items, found liable for contributory infringement and vicarious liability.Vicarious = reap direct financial benefits from customers & has right to remove vendors (control)Contributory = knew about counterfeit products and activity promoted market to bring more customersMGM v. Grokster: ? distributed free software that allowed private individuals to share ? electronic files w/o authorization (napster-like).Inducement: when a distributor takes affirmative steps to foster infringement (induces) through the use of its product, the distributor will be liable for that infringement conducted by 3rd partiesEvidence = ? ads to former napster uses and no attempt to filter infringing materialTrademark (common law)Inducement: if a manufacturer or distributor intentionally induces another to infringe a trademark, or if it continues to supply its product to one whom it knows or has reason to know is engaging in trademark infringement, the manufacturer/distributor is contributory responsible for any harm done as a result of deceitInwood Labs: generic drug company making drug look like brand name not liable, even though some pharmacists were filling rx with generic fraudulently (by labeling with ?).Remedies (see handout)Injunction – applies to all three IP rightsPermanent Injunction: π seeking a permanent injunction must demonstrate (eBay):They have suffered an irreparable injury;That remedies available at law, such as monetary damages, are inadequate to compensate for that injury;That, considering the balance of hardships between π and ?, a remedy at equity is warranted; ANDThe public interest would not be disserved by the injunction.Preliminary Injunction: π must demonstrate:Likelihood of success on merits; ANDIrreparable harm (four factors above).Seizure & Destruction – n/a to patentOwner may seize the items of counterfeiter (virtually identical)Only applies to registered trademarks ?Actual Damages - $$ Patent [35 USC § 284]Π’s Lost Profits: The measure of damages is an amount, which will compensate the patent owner for the pecuniary loss sustained because of the infringement (i.e., profits π would have made absent infringement). Patent owner must prove:Demand for patented product;Absence of acceptable non-infringing substitutes;His manufacturing and marketing capability to exploit the demand; ANDThe amount of the profit he would have made.Lost profit = (# of sales x price) – variable costs (fixed costs s/a management, property taxes, and insurance, are excluded from the calculation).Entire Market Value: If the infringement is on an integral part of a single product (not removable/replaceable), and the patented feature is the important part of the demand for that product, then you can get a royalty on the entire value of the sales.Allows for recover of damages based on the value of the entire apparatus containing several features even though only one feature is patentedLost Royalties: determination of a reasonable royalty is based on what a willing licensor and licensee would bargain for at a hypothetical negotiation on the date the infringement started. If you can prove lost profits, you can’t recover royalties on presumed sales; but if you can’t show actual pecuniary loss, you may recover royalty damages. Look to other license agreements for evidence of royalty rateCopyright [§ 504(b) OR (c)]§ 504(b): actual damages + infringers profits, to the extent they don’t overlap; Infringing profits: π must show gross profits and ? has the burden to prove costsMay consider direct or indirect profits? has BoP to prove they would have made similar profits even without alleged infringement.Overlap: when ? made sales π otherwise would have made § 504(c): statutory damages – single award of damages per work infringedAll parts of a derivative work or a compilation are considered a single work –ask, is there any independent economic value within the larger ? work?$750-$30,000: decided by the courtIf ? proves innocent infringement, can decrease to $250 – this defense will be denied when notice was properly given on the published copy or phonorecord, to which the ? had access.If π?proves willful infringement, can increase to $150,000 – occurs when ? knows or should have known that his actions constitute infringement, or acts with reckless disregard ** §412: statutory damages only available to ? owners who –Registered ? before ?’s infringement commenced; ORIn the case of published works, within 90 days of first publicationTrademark [§ 35(a)]?’s profits, any damages sustained by π; andThe costs of the action.Treble Damages – patent & ? only May increase by up to 3x actual damagesTypically only for willful infringement – seen as a punishmentDefendant’s Profits – n/a to patentDetermine how much $$ ? has gained as a result of the infringementAttorneys FeesCopyright§ 505: available to the prevailing party, and not limited to exceptional circumstances§ 412 –recovery of attorneys fees only available if owner:Registered ? before the infringement commenced, or Within 90 days of publication.Patent [35 USC § 285] & ?: the court in exceptional circumstances may award reasonable attorney fees to the prevailing partyPreemptionSupremacy Clause: if there is a conflict between federal and state law, federal law prevailsVery common for IP cases to be tried in federal court under federal law, but also to plead other state COAsThese include:Trade secretIdea LawMisappropriationPatentRULE: states may not offer patent-like protections to intellectual creations that would otherwise not be protected under federal law.Bonito Boats: federal patent law preempted FL statute, which prohibited the use of the direct molding process to duplicate unpatented boat hulls.Protection offered by statute conflicted with the balance struck by Congress in the federal patent statute between the encouragement of invention and free competition in unpatented ideasCf: Kewanee - state trade secret protection did not conflict because it is weaker than patent law (allows independent invention and reverse-engineering) & Sears/ComCo – state law cannot prohibit and copying an article of manufacture in the market where the patent was either invalid or didn’t exist, is preempted. Copyright – statutory preemption in Copyright Act § 301A state law claim is preempted when:General scope requirement: The state law claim seeks to vindicate legal or equitable rights that are equivalent to one of the bundle of exclusive rights already protected by ? law under § 106; ANDSubject matter requirement: the particular work to which the state law claim is being applied is fixed and falls within the type of works protected by the ? act under § 102 and § 103 – falls within the ambit of copyright protection Scope: Copyrightable material often contains uncopyrightable elements within it, but preemption bars state law misappropriation claims with respect to uncopyrightable as well as copyrightable elements – when within a larger workNBA v Motorola: ? made handheld pager, which displays updated information of professional basketball games in progress. Similar to INS clams, but π was denied an injunction b/c ?’s transmission of “real time” NBA game scores was not a misappropriation of “hot news”RULE: Narrow “hot news” exception survives preemption – INS-like claim is limited to cases where:Π generates or gathers information at a cost;The information is time-sensitive;A ?’s use of the information constitutes a free-riding on the π’s efforts; ANDThe ability of other parties to free-ride on the efforts of the π would so reduce the incentive to produce the product or service that its existence or quality would be substantially threatened** Unfair competition and misappropriation claims grounded solely in the copying of a π’s protected ? expression are preempted, unless the above elements are present. ................
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