Letter from AmeriKat II: Good Day Sunshine (patents)

Google's $900 million bid for Nortel's patents

Last Monday Google announced a bid to buy almost 6000 patents and patent applications from Nortel, the bankrupt Canadian telecoms equipment manufacturer, for $900 million. The patents include patents for wireless, internet and social platform technologies. The bid comes as part of Google's strategy to shield itself from patent litigation. The thinking is that if you buy enough patents that cover a wide and diverse range of technologies and industries, you may have a patent in your legal arsenal that may have otherwise been used against you. Google currently possess a comparatively weak patent portfolio in comparison to their market share and expansion into mobile operating systems, especially in relation to android-related technology. Readers may recall that Oracle sued Google last fall for patent infringement of its Java patents by Google's open-source android operating system. (District Judge Alsup, who is presiding over the case, last week received a tutorial in Java. Also, for a fun trade secret case involving HP and Oracle see this recent news here)

Although it was reported that other tech companies were expected to make bids for Nortel's patents, there may be few that can beat Google's incredibly high bid. On Monday, Google's general counsel and Senior VP Kent Walker(picture, left) wrote on Google's blog that

"... one of a company’s best defenses against this kind of litigation is (ironically) to have a formidable patent portfolio, as this helps maintain your freedom to develop new products and services. Google is a relatively young company, and although we have a growing number of patents, many of our competitors have larger portfolios given their longer histories.

So after a lot of thought, we’ve decided to bid for Nortel’s patent portfolio in the company’s bankruptcy auction. Today, Nortel selected our bid as the “stalking-horse bid," which is the starting point against which others will bid prior to the auction. If successful, we hope this portfolio will not only create a disincentive for others to sue Google, but also help us, our partners and the open source community—which is integrally involved in projects like Android and Chrome—continue to innovate. In the absence of meaningful reform, we believe it's the best long-term solution for Google, our users and our partners."

The planned sale of Nortel's patent portfolio must first beapproved by judges overseeing Nortel's bankruptcy cases in the US and in Canada. As reported by Bloomberg, anyone planning to beat Google's offer has to beat it by at least $25 million more than Google's initial offer, or at last count, $5 million more than the last offer. Anyone have $905 million to spare? The AmeriKat wonders what the return on investment is on purchasing a patent portfolio which with patents and/or applications that will have only about 20 or so years of life in them? Will Google ever make back theri $905 million on savings to legal fees or from patent damages? Or does that even matter as long as Google is sending a message to would-be plaintiffs that their patent portfolio is now robust, so sue at your peril? What do readers think?

US and UK unite for some more sweet patent harmony

David Kappos's UK harmonization tour last week not only yielded a Monday morning breakfast at UCL, but progress on the UK and US's joint action plan to combat the problem of patent backlogs and their effects. The joint announcement was made by Kappos and Baroness Wilcox, (compare the IP experience) Kappos stated that:

“The joint action plan highlights that while 21st century patent challenges are global in scope, so too are their solutions. Work sharing is a powerful tool that equips examiners to extract value from our skilled colleagues in other patent offices. By reducing redundant workloads and chipping away at the backlog, we can collaborate to unleash millions of jobs lying in wait and breathe life into our economies.”

The action plan is designed to allow an examiner in one office the ability to reuse work already done by an examiner in the other office on a corresponding applications, as much as possible to avoid duplication of work.

Kappos was also interviewed by The American Lawyer recently regarding the recent patent reforms (read interview here) and the America Invents Act (see recent AmeriKat posts here). When asked whether he thought it was that the House would pass a similar bill, Kappos replied:

I am off-the-charts optimistic.

The AmeriKat loves the enthusiasm.

USPTO/AIPLA Roundtable Report: Chinese utility models and design patents

While the AmeriKat had her whiskers in a pile of papers (picture, left) last Monday, the United States Patent & Trademark Office (USPTO) and the American Intellectual Property Law Association (AIPLA) was busy hosting a travelling roundtable discussion on China’s system for the procurement and enforcement of utility model and design patents. The aim of the roundtable was to afford US lawyers, companies and the public understanding about how China’s utility model and design patent system. The AmeriKat and IPKat's good friend, Michael Lin, of Marks & Clerk (Hong Kong) was there reporting on the key issues discussed at the event:

The USPTO's Elaine Wu started off the roundtable, and key note speeches by the USPTO's Dave Kappos and AIPLA's President, David Hill, (picture right) emphasized the growing importance of understanding IP in China via actual discussion with on-the-ground experts vs. the reliance on hearsay. To this end, the AIPLA and USPTO are jointly sponsoring this traveling roundtable discussion program with subsequent events being planned in the US and China.

Microsoft's Director of International IP Policy Mark Cohen laid out the background and framework of Utility Models ("UMs") and Design Patents in China and their alternative as a cheap and fast form of IP protection. Mark also showed some interesting statistics that it is overwhelmingly Chinese entities who are filing and using UMs and Designs Patents. Discussion followed as to the root causes of this, and why relatively few foreign entities apply for Chinese Designs, and particularly UMs. US practitioners are typically unfamiliar with UMs because they are not available in the US, although some other countries (Germany, Japan, etc.) do have them. While many countries have Designs Patents, few foreigners file their Designs Patents in China, as their scope is generally regarded as being quite narrow as dotted-lines (i.e., partial designs) are not allowed.

Elaine chaired the first panel discussion with Thomas Moga (Shook, Hardy & Bacon) (picture, right) explaining his interesting uses for Design Patents in China beyond what is typically allowed in the US. Meanwhile, Toby Mak (Tee & Howe) explained that the subject matter of UMs in China is limited to physical objects whose novel element is related to the shape or construction thereof. Thus, protection of chemical compositions, methods of use, etc. are not allowed via UMs. Toby also discussed the procedure for concurrently filing for both Invention Patents (i.e., US-style Utility Patents) and UMs in China. Toby also explained that by filing for both a UM and an invention patent in China, you can obtain both short-term protection as well as long-term protection; once the invention patent is ready to grant, then the Examiner may ask you to elect to keep either the UM or the Invention patent and abandon the other one in order to avoid double-patenting. IBM's Associate General Counsel for IP, Manny Schecter explained that IBM does not file for such IP in China (or elsewhere) as they are not subject to substantive examination and therefore their enforceability is highly suspect, even when granted. It seems that IBM, for one, simply wishes to have greater assurance that any of its granted patents are actually ultimately enforceable.

Skip Fisher (Perkins Coie) (picture, left) then chaired the panel discussion about enforceability of UMs and Design Patents. Michael Lin (Marks&Clerk, Hong Kong) led off the discussion about enforcement via China-specific administrative routes such as at Customs, local raids, seizures, and at trade shows. Ultimately, Michael believes that UM and Design Patent enforcement is possible in trade fairs, especially for exact copies. However, enforcement via customs and other administrative routes are more difficult than, for example, trade mark enforcement. Ping Gu (Unitalen) discussed the many complicated issues involved with legal enforcement of IP via the Chinese court system. Geoffrey Lin (Hogan Lovells) described his personal involvement with the Chint v. Schneider case which resulted in the largest ever IP judgment in China of 330 Million CNY ( about US $44 Million). Although IP litigation in the courts is increasing and the judges are getting better, evidence collection, forum shopping, local court regulations, political factors, etc. may all greatly affect the result of first-instance litigation. However, the availability of appeals to a higher court may in some ways mitigate these effects. As China has virtually no "discovery" available to plaintiffs, all panelists agreed that the collection of court-acceptable evidence prior to initiating litigation is essential and remains a serious problem in China.

The roundtable concluded with USPTO's Albert Tramposch heading an open discussion with all participants identifying issues (e.g., susceptibility of UMs and Designs Patents for abuse by NPEs, lack of a duty of disclosure, lack of substantive examination before grant, etc.) and discussing potential future actions, law changes, administrative, changes, etc. to address some of the issues. Participants hope that China will pay special attention to legal and administrative transparency and further improve equal treatment under the law.

Overall, it was a highly informative roundtable with excellent questions and observations from both the audience, presenters and panellists.

The AmeriKat thanks Michael for reporting and AIPLA and USPTO for organizing this roundtable. She is often surprised daily about how many UK IP lawyers do not take action in China or are unaware of what is available to them and their clients in China. Does anyone know if the UK IPO has planned or will be planning something similar for the UK audience?

AIPLA-USPTO roundtable here.
Round pool table here.
A famous Round Table here.

A round robin here.

Letter from AmeriKat: Return of the AmeriKat

For anyone who knows the AmeriKat personally and professionally, they will know that during the past seven weeks the AmeriKat has faced a flurry of deadlines, deliberations, duplicitous documents and a dosing of sleep deprivation. Her absence from her beloved letters was not one of choice, but one of necessity as every two days she was hit with another deadline. (picture, left - the AmeriKat up late in front of one of her many outstanding deadlines) The deadlines were increasing in frequency, but as the old saying goes “absence makes the heart grow fonder”, especially when the absence is not voluntary. When the AmeriKat was writing this post, she was curled up on her bed, watching her clock until she had to leave to catch a flight for yet another deadline. However, now with the passing of the last seven weeks, she has returned to first give you a brief glimpse of the first of the latest US IP tails. She will be back later throughout the week with more detailed posts on some of the most important news in US IP law.

Patent Reform Act 2011 Gets Senate’s Thumbs-Up

Two weeks ago the US Senate passed by overwhelming majority (95-5) the America Invents Act (“AIA”) (a.k.a. the Patent Reform Act 2011). Mr. IP himself, Senator Patrick Leahy (D-Vermont) introduced the Patent Reform Act 2011 to the Senate Judiciary Committee this past January. The AmeriKat has set out below the main provisions that the original draft bill contained before the Senate and what the AIA now contains below (a comparison of the two can be found here):

First -to-File: The biggest change introduced by the AIA would be the transition in the US from a first-to-invent system towards a first-to-file system where each patent application would be allocated an “effective filing date”. Similar to that in the EU, the application’s novelty and obviousness is then judged on the prior art available before the effective filing date of the patent, but with a one year grace period still remaining in effect in respect of the inventor’s own disclosures. Democratic Senator Dianne Feinstein had proposed an amendment (Amendment No. 133) that would have removed these provisions arguing that their effect would be especially burdensome to small independent inventors (click here to watch her introduction of the amendment.) However, the Senate voted down the amendment by 87-13 with proponents of the first-to-file provision arguing that the availability of applications such as pre-issue disclosure, post-grant review and inter-partes review would rebalance any alleged burden that the first-to-file paradigm could create. Opponents to the first-to-file system also believe that this introduction will worsen the huge backlog of patents faced by the USPTO (see post here) and result in the system being clogged up with thousands of unmeritorious inventions.

Damages: The review of the assessment of patent damages that was taken up by Microsoft in their initial appeals in the i4i case last year (see AmeriKat posts here) evidenced only a sliver of general unrest with the assessment of US patent damages. The original draft of the Patent Reform Act 2011 introduced proposed amendments that would provide for specific procedures on how judges in patent cases manage the damages assessment. These included mechanisms for the court to consider the evidentiary merit of each parties’ case on damages and then the judge introducing a methodology that would be used in assessing the damages awards. Close the AmeriKat’s heart at the moment was the old text also requiring a judge to split the damages portion of a trial at a parties request and only rejecting that request in the absence of a good cause, such as “the absence of “issues of significant damages or infringement and validity”. All of these draft provisions did not make it past the Senate's approval perhaps signaling a reluctance to delve into the problematic pool of patent damages which may have held the entire bill’s passage hostage.

Enhanced Damages: In the current US Patent Act, there is not specific reference that the increase of patent damages should only be reserved to cases of willful infringement. Section 284 of the current statute, instead, states that “the court may increase the damages up to three times the amount found or assessed.” The Federal Circuit’s interpretation has limited this section to cases to willful infringement and where the defendant’s actions were objectively reckless. The draft text of the Patent Reform Act had basically codified this precedent, but again, like with general damages, this did not make it to the final text.

USPTO Proceedings: The AIA also introduces under Sec 135 a “derivation proceeding” that arises when an original inventor claims that a patent applicant derived their invention from the original. Third parties will also be allowed to submit any prior art documentation with accompanying relevant reasons for the submission to the USPTO prior to the examination proceedings. A post-grant review proceeding would also be created and which allow any party within 9 months of the patent’s issue to present a validity challenge to one or more of the patent claims. Replacing the inter partes reexamination would be the inter partes review which would limit reviews to issues of novelty and obviousness arising from prior art patents and printed publications. The effect of the post-grant review has been considered by some as not ensuring the quality of the granted patents, but as potentially increasing the expense a patent-holder could face during the adversarial proceedings.

Besides deleting more interesting parts of the bill, the Senate did add Section 18 which deals with provisional measures for the establishment of post-grant review proceedings for the review of the validity of business-method patents. False marking lawsuits would be eliminated under the proposed 146 (k) except for ones filed by the US government or by a competitor who can prove competitive injury as a result of false marking. Also, reduced fees for small entities were also introduced.

The American Innovators for Patent Reform (AIPR), a trade association which promotes innovation by strengthening the US patent system, has opposed the AIA. Alexander Poltorak, the founder and President of AIPR and AIPR stated that the AIA, in particular the first-to-file provision would be viewed as a “defeat by many inventors”, however the removal of the damages provisions (which were referred to as the “most damaging provisions” – no pun intended) were heralded as a success. David Kappos, the USPTO's Director, has said that the US is already operating a pseudo-first-to-file system because in 2007 there have only been 7 interference applications (where two inventors file their patents nearly simultaneously) of which only one was decided on priority of the invention and "the truth is that only .01% of all patent applications could be affected" by the change.

The next stage of the bills life will be in the House (watch the life of a bill, courtesy of Schoolhouse Rock). If passed by Congress , the AIA could well be on its way of becoming the first substantial change to patent law in the U.S. in almost 60 years, but a bill’s life in Congress can be a rocky ride and can usually, as has been seen in IP legislation, die a quite death.

So what do non-US readers think? Is the introduction of the first-to-file system the end of civilization as we know it, or if the AIA is passed by Congress is Director Kappos correct and US inventors will not notice any difference at all?

Letter from Amerikat: Birthday Bits 'n Bobs

The AmeriKat is celebrating her 2nd birthday this week (she will leave you to calculate her age in Kat years). During the past few days she has cast her mind back to reminisce over the past two years in music, film, politics, and law. When she was a fresh kitten, the radios were booming with Madonna, Queen, Beastie Boys and Peter Gabriel and movie theaters were welcoming audiences to watch Top Gun, Pretty in Pink and Aliens. And in law, in the January that the AmeriKat was born, Kodak lost a patent infringement case with Polaroid, a loss which signalled Kodak's exit from the instant camera business. Today, we may still have Madonna booming away, but this time it is through our iPods. Patent law has also come a long way from the instant camera days. Nowadays our patent wars focus on mobile phone technology, albeit still concerning their camera technology as well as their touch-screen capabilities. This brief journey down memory lane just goes to show that over the past two *cough* years, everything changes, but everything stays the same be it in music or in IP law.

Lawyer Barbie back in the Federal Circuit dealing with Bratz - Something else that has not changed all that much from last year is the continuation of the Barbie v Bratz battle (previously reported by the AmeriKat here) which last week heard the parties' opening arguments in Californian federal court before Judge Carter. Barbie's maker, Mattel, alleged that the maker of the Bratz doll - MGA Entertainment- stole the idea for the Bratz doll by entering into a deal with the designer of the doll who had previously worked for Mattel. Mattel subsequently filed for copyright infringement and trade secret violations, while MGA alleges unfair competition and also trade secret theft. The case being heard by the court last week follows the previously overturned $100 million verdict of Judge Larson in favor of Mattel. MGA appealed this 2008 ruling on the grounds of incorrect jury instructions and an overly broad injunction. The US Court of Appeals for the Ninth Circuit agreed holding that the federal court judge had erred in ruling that Mattel automatically owned the designer's sketch of the doll under the terms of the 'Employee Confidential and Inventions Agreement' between Mattel and the designer and remanded the case back to the federal court. At the end of 2010 both parties applied for summary judgment on the issue of copyright infringement for the first and second generation Bratz dolls. Judge Carter granted summary judgment in MGA's favor in respect of the second generation Bratz dolls, but the remaining issues, including breach of copyright for the first generation of Bratz dolls and the breach of confidence/trade secret claims, remained for trial.

Following Judge Larson's departure from the federal bench, Judge Carter will now be rehearing Mattel's claims, but unlike the first trial the court will be tasked with determining whether the Inventions Agreement entitles Mattel to the designer's ideas for names like "Bratz" together with sketches that he created outside working hours. Also, ripe for ruling is MGA's trade secret claim against Mattel. Last year, MGA filed a counterclaim alleging that Mattel conducted an elaborate corporate espionage scheme in which Mattel employees, including general counsel Robert Normile and their attorneys from Quinn Emanuel, engaged in a racketeering conspiracy in order to gain access to MGA's private showrooms to obtain confidential information of Mattel's competitor's plans. According to a report last year in Am Law Litigation Daily, Quinn Emanuel partner Michael Zeller said that MGA's claims were "second-rate tactics by desperate lawyers" that "won't survive the pleading stage." Well, apparently they have! Mattel's lawyers say that in so far as the information MGA shared was shared at toy fairs, this information does not constitute a trade secret and therefore MGA is not entitled to their claimed $475 million in damages. The trial continues.

MJ's estate increases litigious activities - Last week, Michael Jackson's estate sued a website who is selling a book written by the singer's mother, Katherine Jackson, alleging copyright infringement. As reported by the Associated Press, Howard Mann, who operates the domain name www.jacksonsecretvault.com (picture, right - a shot of the allegedly infringing website left) is on the recieving end of the suit that alleges that he and the website are infringing copyright and are also liable under unfair competition laws. The complaint is reported to allege that the site is using the late singer's likeness and sketches that he drew and is said to creating a fasle endorsement by virtue of the inclusion of a "special thanks" to the estate. In a statement, the estate's attorney Howard Weitzman said that

"The Estate had hoped Mann would voluntarily cease his conduct but that was not to be. People who trade off of Michael's personality, copyrights and trademarks should not be allowed to exploit the legacy of one of the world's most recognized talents for their own benefit."

For more information see these reports in Hollywood Reporter and AP.

Koons's Balloon Dog to pop gallery's bubble? - Artist Jeff Koons has claimed copyright infringement against San Francisco gallery Park Life over a set of bookends that look like Koon's Balloon Dog, i.e. they look like balloon dogs. What do we think IPKat readers? Can Koons claim copyright infringement for anything that resembles a balloon dog? The AmeriKat thinks his lawyers, reported to be Jones Day, must have a field day at children's birthday parties.... For a more in depth look at that saga please see this excellent article in the New York Times. For how to make a balloon dog or an allegedly infringing Koons dog, please click here. (Pictures below from left to right - Koon's Balloon Dog; Park Life's balloon dog bookends; a balloon dog)

USPTO renews its IP Australia vows - Last week USPTO and IP Australia announced the extension of their existing pilot Paris Convention Patent Prosecution Highway (PPH) agreement and the formation of a new PPH pilot agreement utilizing the Patent Cooperation Treaty (PCT-PPH) results. PPH agreements improve efficiency by allowing patent examiners to use work already undertaken in respect of the same claim or claims already reviewed at other patent offices and PCT Authorities. USPTO Director Kappos has stated that by including the PCT "more work can be shared between our two offices. This will benefit applicants by reducing patent pendency and improving quality.” According to the USPTO press release the addition of the PCT international phase work

"will greatly expand the usefulness of the PPH program to applicants and the offices. The new PCT-PPH pilot is scheduled to launch on January 24, 2011. The PPH pilot program and the PCT-PPH pilot program between the USPTO and IPAU are both currently scheduled to continue until April 13, 2012."

Pancake house drops suit against a house of God - Last year the AmeriKat reported on the trade mark suit filed by US eatery chain IHOP which stands for the International House of Pancakes against the International House of Prayer also known as IHOP. Unfortunately, however, there will be no courtroom fireworks in battle between pancakes and God, because four days before Christmas IHOP dismissed its case against the church citing "ongoing mediation with the defendants."

Letter from AmeriKat: Happy Thanksgiving!

Although the AmeriKat was miles away from her computer last week as she was instead kicking up the leaves in Clifton Village (picture, left) while venturing around her old Bristol alma mater, she is back this week in time to spread the Thanksgiving cheer. Thanksgiving is this Thursday, and for those who have followed the AmeriKat will know that it is her most favorite of holidays; copious amounts of roast birds (meow!), mashed potatoes, and pumpkin pie together with very little activity except changing the TV channels between football games - what is not to love?! The joy of Thanksgiving, because it is a non-denominational holiday, is that all Americans can and will celebrate it. Besides the Fourth of July, Thanksgiving is the most participatory and democratic of holidays.

Happy Thanksgiving!

Lone senator stalls the controversial Combating Online Infringement and Counterfeits Act

A reminder of the importance of democracy in the US came late last Friday when a single senator, Senator Ron Wyden (D-Oregon, picture, right) stalled the Combating Online Infringement and Counterfeits Act (COICA) at a committee hearing. The Bill, which would have given the federal government power to shut down or block websites that participate in copyright infringement, had been unanimously approved by the Senate Judiciary Committee on Thursday. Wyden's objection may have the effect of postponing the Bill until the next Congress convenes. Wyden stated that:

"Deploying this statute to combat online copyright infringement seems almost like using a bunker-busting cluster bomb, when what you need is a precision-guided missile."

The Bill provides for the creation of a blacklist of websites that the US Government can seize if based in the US or require an ISP to block if they are located abroad. The Bill, which amends Chapter 113 of Title 18 of the US Code (which deals with stolen property) has the effect of targeting websites which are "dedicated to" and are "primarily designed" for copyright infringing activities or have no other "demonstrable commercially significant purpose or use" - which is one of those lofty definitions which makes the AmeriKat grimace. The actions are brought by a state's Attorney General who will apply to the court for an injunctive order to be served on the website domain registrant directly (if located in the jurisdiction) or on an ISP (if located outside the jurisdiction) with the effect of removing or blocking the website from the Domain Name System. There is no provision in the Bill requiring a hearing, trial or defence from the party served with one of these orders. The Bill also provides powers to stop credit card companies from authorizing transactions that occur on these websites. All court orders will be alerted to the Intellectual Property Enforcement Coordinator, Victoria Espinel (picture, top left), who will post the domain names on a publicly available website with relevant information on the order.

Mr IP Senator himself, Senator Patrick Leahy (D-Vermont) who co-sponsored the Bill said:

"Few things are more important to the future of the American economy and job creation than protecting our intellectual property. That is why legislation is supported by both labor and industry, and Democrats and republications are standing together."

However, critics have blasted the legislation as being overly severe and too broadly worded which would have the effect in practice of censoring websites that the government just doesn't like. The Electronic Frontiers Foundation, who have posted a list of websites that that they believe will be the first targeted if COICA is passed, stated that

"Blacklisting entire sites out of the domain name system is a reckless scheme that will undermine global Internet infrastructure and censor legitimate online speech."

It has been suggested that Senator Wyden will now attempt to put as many procedural roadblocks in the way of the Bill until the new Congress takes session in 2011, at which point the Bill will have to be resubmitted. At the end of September the man credited with technology central to the Internet, Sir Tim Berners-Lee, called the recent spate of bills threatening to block and cut off access to the Internet as a "blight".

The AmeriKat will be watching to see how Senator Wyden's roadblocking progresses.

Supreme Court hears gray goods arguments in Omega v Costco

The US Supreme Court heard arguments last week in the case of Omega v Costco (see previous AmeriKat reports here for detailed analysis of the case and arguments), a case appealed from the Ninth Circuit (California) which has the power to impact the future of the multibillion dollar "gray goods market". The "gray goods market" is where companies sell their products at a cheaper price to distributors based in countries other than where the product is ultimately retailed. Retailers, like Costco, will then buy the products from these overseas distributors and import them into the US to sell at a discount - a third off in the case of Costco's sale of the Omega Seamaster line.

The argument centers on whether Omega can use a copyrighted logo on one of their lines of watches as a mechanism for stopping Costco from selling them at a discount in their US stores. Costco is arguing that the Supreme Court extend their 1998 ruling of Quality King Distributors v L'Anza Research International (1998) which held that copyright owners do not have a right to control the market of their goods that have been imported and re-sold in the US. However, the Quality King ruling was about domestically made goods sold overseas and then imported back into the US. Here the goods are manufactured overseas, sold to overseas distributors and then imported into the US. The question to the Supreme Court is whether the 1998 ruling should be extended to these cases and also to determine the exact scope of the first-sale doctrine.

Although reported that the Justices did not give a clear indication of which way the ruling would go, they did seem concerned that there appears to be a statutory interpretation and a 9th circuit ruling that gives incentive to companies to manufacture goods overseas. Justice Ginsburg (picture, left) stated

"What earthly sense would it make to prefer goods that are manufactured abroad over those manufactured in the United States?"

The Supreme Court's decision will have a substantial impact on what goods retailers, especially those on-line retailers such as eBay or Amazon, can sell and import into the U.S. eBay, Intel, Amazon and Target have all voiced support for Costco. Omega, on the other hand, has support of the Obama administration, the ABA, and of course the music and film industries. The Supreme Court decision is expected in July 2011.

Between a Rock and a Hard place - Hard Rock trade marks hit the courts

Hard Rock Hotel Holdings LLC, which runs the Las Vegas Hard Rock Hotel & Casino, was sued in the Second Circuit for the Southern District of New York (Manhattan) in September by Hard Rock Cafe International Inc, the Florida-based owner of the Hard Rock trade marks. The trade mark owner alleged, amongst other things, that the reality show authorized by the Las Vegas company, "Rehab: Party at the Hard Rock Hotel", was tarnishing the Hard Rock brand. The lawsuit sought cancellation of the Las Vegas hotel's licence to use the marks. The casino has now fired back in a court filing two weeks ago which has claimed that it has done nothing wrong and is only a victim of "systematic legal and business harassment" by the Florida owner. The casino is also counterclaiming for breach of contract and tortious interference with business relations. The casino's filing also says that:

"The Cafe complains about a range of alleged trademark abuses that in many cases it has long known about, tolerated or even approved. Most notably, the Cafe claims to be shocked and disturbed by the popular reality television show 'Rehab: Party at the Hard Rock Hotel,' filmed at the Hard Rock Hotel and Casino Las Vegas – despite the fact that this show and the lively behavior it portrays have already been on the air for two years; depicts an event similar to the 'Detox' party held at one of the Cafe's properties (Biloxi, Miss); and has brought enormous positive publicity to the Hard Rock brand."

For more information see this article in the Las Vegas Sun and Los Angeles Times.

USPTO to make ex parte patent appeals easier and Tweet about it

Last week the USPTO issued a proposal to change the rules for ex parte patent appeals before the Board of Patent Appeals and Interferences and requests for public comment on the changes. The changes will include rescinding the stayed 2008 Final Rule and simplifying the petitions practice in appeals. For more information see this Press Release from the USPTO. Last week also saw the USPTO launch their Twitter account. To follow the USPTO click here, the AmeriKat click here, and laden ladenfam click here.

Letter from AmeriKat: James Bond's gun, pre-1972 recordings, ITC patent fun, and Walgreens' "Flying W"

For the past couple of week's the AmeriKat has been balancing a pretty hefty schedule of deadlines and late nights. Her early morning starts and late night returns were beginning to grate on her nerves; the processional commute was feeling more and more like a chore than an opportunity to mindlessly follow the stream of commuters. So twice last week, while on her way to work, she stopped her blaring iPod, opened her eyes and scanned the inhabitants of her carriage. Besides the usual set of businesspersons flicking automatically through the pages of the Metro and the tourists straining their eyes at the Tube maps, she spied two distinctive objects out of the usual commuter selection: a spider and a ladybug. The spider was making a webfrom the top of one pole to the other and then casually swinging from its silk between stops. The ladybug was making its way up the arm of a large, burly looking man while he delicately watched its progress. From the otherwise indistinct, one can always find distinctiveness. (picture, left - the AmeriKat playing with the said ladybug)

Bond's gun a hit at the USPTO: Something else that has been held to be distinctive last week, this time by the USPTO, was James Bond's Walther PPKhandgun. The makers of the spy's classic weapon had previously attempted to register the gun as a trade mark, but the USPTO had concerns as to whether the gun had, in the maker's mind, a "definite aura" and "mystique". To convince the USPTO examiners otherwise, the makers commissioned a blind survey of individuals over 18 years old who own or plan to own a handgun. The results of the survey showed that about 54% of those surveyed were able to identify the PPK gun, many of whom also mentionedJames Bond as the reason for their identification. So with this convincing data before the examiner this time, the USPTO held that the mark had acquired distinctiveness and that

"it stands to reason that a party would only attempt to replicate another party's trade dress or product configuration, under license or not, if that trade dress or product configuration is perceived by the consumers as distinctive."

Although not uncommon by any means, the provision and weight of survey evidence afforded by the USPTOin this case may result in future applications for shape marks, or indeed any application that argues acquired distinctiveness, necessarily having such survey evidence in support. For more information see this report from The Hollywood Reporter.

Copyright Office to investigate pre-1972 sound recordings: Where were you in 1971? If you are the AmeriKat's age you weren't even an idea yet, but for those who remember 1971 Led Zeppelin's "Stairway to Heaven" was topping the charts, Jim Morrison was found dead in a Paris bathtub, and the US Supreme Court ruled that the Pentagon Papers could be published. And if you were a sound recording in the US at this time, the federal government didn't even recognize you as a work. However, this may be changing with the US Copyright's announcement last week that it will be investigating the issue of pre-1972 sound recordings.

Before launching into this story, the AmeriKat must give readers a short lesson into this area of US copyright. In 1909, the US Congress held that the US Constitution did not allow copyright to cover sound recordings because sound recordings were not "writings". Therefore, the US Government (i.e., federal government) did not legislate on sound recordings. This left individual US states to legislate this area for themselves which left a patchwork quilt of the length and strength of protection for pre-1972 sound recordings. In 1976, when copyright law was next changed, the US government then legislated for the inclusion of sound recordings, but of course this legislation was not retrospective so therefore pre-1972 recordings were governed by the old system. Obviously, the uncertainty of the protection for these recordings in terms of scope and when the works will enter the public domain is a problem increasingly encountered today.

Recently the US Congress has directed the US Copyright Office to conduct a study to investigate whether it may now be a good idea to bring pre-1972 recordings under federal jurisdiction. The areas of investigation the study is to address include the effect of public access to the recordings and the economic impact such federal jurisdiction would have on the rights-holders of these recordings. The Copyright Office has published a notice of inquiry requesting written comments from all interested parties and has requested input on the effect that such federal protection would have upon these sound recordings. The AmeriKat, in her rose-tinted view, can only think that consistency and predictability of copyright can only be a good thing - although she is sure that rights holders of pre-1972 works may vehemently disagree. Initial comments must be submitted by 20 December 2010, with reply comments due 18 January 2011. For further information on the protection of pre-1972 sound recordings see this paper prepared by the Program on Information Justice and Intellectual Property at the Washington College of Law.

ITC side with Nokia in Apple patent spat - The US International Trade Commission (ITC) staff stated last week in a pre-trial memo that Nokiashould not be found liable for infringing Apple's patents. The statement came at the start of the ITC trial on the issue. Apple had requested the ITC to block imports of Nokia phones using the Symbian operating system as they were allegedly infringing four of Apple's patents. Nokia contends that some of Apple's patent claims are invalid, and the remaining claims were not infringed. ITC staff, who act as an impartial third party in ITC cases on behalf of the US public, declared that the evidence "will not establish a violation", but that if the judge was minded to find for infringement then it followed that the Nokia phones should be blocked. Judge Charles Bullock is expected to issue his findings in February 2011. Any decision by Judge Bullock will be subject to review by the six-member commission. For more info on the Apple/Nokia battle see previousAmeriKat reports here and here. For more information see this report in Bloomberg and Ars Technica.

Walgreens sues Wegmans: In the UK, if you require a medicine or shampoo you go to Boots. In the US you go to Walgreens. Walgreens, unlike Boots, is much larger, equipped with drive-up windows to pick up and drop off prescriptions during your busy day, and has aisles devoted to non-pharmaceutical products, such as school supplies, greeting cards and junk food. It is safe to say that there is probably very few Americans who have not shopped at Walgreens at some point. Now Walgreens is suing the New York-based supermarket chain Wegmans, alleging that Wegman's logo is too similar to Walgreens'. Walgreen's filed their trade mark infringement complaint against Wegman's two weeks ago in Virginia. Walgreen alleges that its "flying W" deserves protection due to its use from 1951. Wegmans contend, however, that the "W" it started using in 2008 was a revival of a logo that it had used in the 1930s. A spokesperson for Wegman's said that there was no confusion between the two logos. According to a reportSouthern Tier of New York, people that the news channel interviewed were apparently more confused about why the lawsuit was filed than about the "W"s alleged similarity at all.

Pratt & Whitney to stop Rolls-Royce?: Pratt & Witney, manufacturers of jet engines, filed an US International Trade Commission (ITC) complaint last week to stop shipments of Rolls-Royce engines to Boeing for the production of the 787 Dreamliner (picture, right). For the past few months the two companies have been engrossed in disputes when in August Rolls-Royce filed a lawsuit alleging that the fan stages on some of Pratt's products infringed Rolls-Royce's swept fan blade. Pratt then issued a separate complaint in September alleging that Rolls-Royce had mislead the USPTO in order to be granted the patent for the fan blade. Next stop for Pratt this past week was filing a complaint for patent infringement against Rolls-Royce at the US ITC as well in the UK's High Court for infringement of their Trent 1000 and 900 engines. Trent 1000 and 900 engines are used in the Boeing 787 and Airbus's A380 respectively. All in all, not a good week for Rolls-Royce following last week's scare on a Quanta's flight to Sydney. The AmeriKat has not seen the complaint from Pratt & Whitney, but given the allegations that a design flaw is to blame for the scare alleged to have been caused by the Rolls-Royce engine on the Quanta's flight, is it a good move to now allege that that the Rolls-Royce engine infringes their engines? For more information click here.

Letter from AmeriKat: Happy Halloween!

The AmeriKat adores the fall holidays. For those who know her Thanksgiving is by far the AmeriKat's favorite holiday, but running a close second is Halloween. Although she has begun noticing a growth in Halloween parties and events in the UK, no one does Halloween like the US. Costumes are plastered on our infants from the womb and grocery store aisles are devoted to crates of candy and ghoulish masks. Unlike the UK where one generally has to dress up 'scary' for the event, our costumes span the gambit of fancy dress; a mermaid, a flight attendant, a pumpkin are all acceptable attire. This Halloween, the AmeriKat had planned to go as a Savannah flapper vampire (complete with accent and all) to one of her friend's Halloween parties and so she laid her head down to take a 15 minute power nap before the preparation would begin. However, when she later awoke it was 1 AM and her Halloween fun had sadly vanquished - a lesson that there is no such thing as a Kat nap. (picture, top left - look closely and you will see the AmeriKat asleep in her jack o'lantern)

Happy Halloween from the AmeriKat!

Court squeezes all the juice from the LimeWire: Something else that has been vanquished this week is LimeWire, the music file-sharing service that is a favorite of old and young alike. Last Tuesday Manhattan federal judge Kimba Wood ordered that LimeWire be permanently shut down by disabling the "searching, downloading, uploading, file trading and/or file distribution functionality" of their file-sharing software. This injunction follows a ruling six months ago that found the company and its founder, Mark Gorton, liable for copyright infringement on a "massive scale". LimeWire is still in the process of negotiating licence deals with major record labels to legally provide music for sale with a subscription service. Following the ruling Gorton issued a statement declaring that:

"While this is not our ideal path, we hope to work with the music industry in moving forward. We look forward to embracing necessary changes and collaborating with the entire music industry in the future."

Meanwhile the RIAA (Recording Industry Association of America) who handled the lawsuit issued the following following statement:

"For the better part of the last decade, LimeWire and Gorton have violated the law. The court has now signed an injunction that will start to unwind the massive piracy machine that LimeWire and Gorton used to enrich themselves immensely"

Now with the issues of liability and the injunction determined, the court will now be tasked with the quantification of damages early next year that the company and Gorton will have to pay. The LimeWire injunction came shortly after the former head of Warners Music in the UK, Rob Dickins, suggested that albums should go for as little as £1, which would enable the purchase to be an impulse purchase. Others, such as Paul Quirk the head of Entertainment Retailers Association, suggested that Dickins had already benefited from the heyday of $14 albums and was too casual with his statement (see this report in Ars Technica). From courtrooms to industry meetings, everyone is struggling to put a price on music. But is a music track worth a bottle of water, or a hardback novel? Regardless of the correct answer, the court's assessment of damages in the LimeWire case next year will be far greater than either of those values.

Hell's Angels take on Alexander McQueen: What does couture house Alexander McQueen and the Hells Angels Motorcycle Club have in common? Nothing, unless you count the recent lawsuit brought by the Hells Angels in California federal court Monday against Alexander McQueen Trading Company, owned by PPR, for use of their trade mark name and mascot winged death head symbol (picture, left). The famous motorcycle group has reportedly used their name and symbol since at least 1948 and are also proprietors of a USPTO registered trade marks in classes for jewellery and clothing. For those who are unfamiliar with the Hells Angels, the gang is comprised of motorcycle enthusiasts that are admitted once strict requirements are met. The FBI classifies the Hells Angels as one of the big four motorcycle gangs with links to violence and organized crime(although the group denies this). Not exactly a group of people that you would want to rip-off....

The complaint lists a $495 four finger duster ring called the "Hell's Knuckle Duster" which includes the protected winged death head design, a $2,329 clutch (picture, right) with a similar symbol, as well as a $1,595 dress and $560 silk scarf. These garments and accessories which include similar marks of the Hells Angels would, when worn, represent membership insignia and, according to the Hells Angels' attorney, Fritz Clapp ,"anyone wearing them would be considered an imposter by club members”. Eeeek! This invokes a somewhat funny image of a woman with an incredibly expensive designer handbag being chased by the Hells Angels for trade mark infringement.

This complaint against Alexander McQueen comes at the same time costume designer Jany Temime was accused of knocking off a McQueen dress in the upcoming Harry Potter film. Temime designed a wedding dress for the marriage of Bill Weasley and Fleur Delacour which incorporated a phoenix bird and feather motif, which is reminiscent of McQueen's peacock dress of A/W (Autumn/Winter) 2008. The dresses both include the heads of two birds at the bodice line with their body and feathers cascading down through the skirt. It seems incredible to the AmeriKat that a cosutme designer for a prominent film would skate so close to the edge of design protection. Some investigation by the AmeriKat has come up with a question that the dress was actually authorized by Alexander McQueen, but the official story has yet to be forthcoming.

USPTO and EPO unite to develop join patent classification system: Last Monday the USPTO announced that it will be working with the EPO to establish the formulation of a joint patent classification system. Because the USPTO pre-deates the International Patent Classification (IPC) system, the US system is not alligned with many other countries. The joint classification system will be more detailed than the current IPC system to improve patent searches, which will also aim to eliminate the duplication of work between the USPTO and EPO. David Kappos, Director of the USPTO, and Benoît Battistelli, head of the EPO, issued a joint statement stating that:

"In view of the significant benefit to stakeholders of developing a transparent and harmonized approach to global classification system for patent documents; in order to make the search process more effective; and in the belief that cooperation between the two offices will facilitate progress in undertaking classification harmonization projects under the IP5 Common Hybrid Classification initiative, the USPTO and the EPO have agreed together to work toward the formation of a partnership to explore the development of a joint classification system based on the European Classification system (ECLA) that will incorporate the best classification practices of the two offices. This system would be aligned with the WIPO classification on standards and IPC structure. Accordingly, they have initiated discussions on governance and operational aspects of such a partnership"

Earlier this month the USPTO launched its second pilot of their Peer to Patent system which commenced on 24 October 2010. With the stated goal of "enhancing government effectiveness through openness and collaboration", Peer to Patent is a system whereby the patent examination process is open to the public who can submit information, such as evidence of prior art to assist USPTO patent examiners during their examination. In the first Peer to Patent pilot over 600 items of prior art were submitted for 189 applications. The AmeriKat wonders if this could be a nice and easy way for current patent holders to 'pre-litigate' and knock patents of potential competitors out of the system. If so, is that a good or bad thing?