Intellectual Property

What is a trademark? • Lanham Act 1976 • A word, symbol, or phrase, used to identify a particular manufacturer or seller’s products and distinguish them from the products of another. • Must be used or promise a “good faith” intent to be used, in interstate commerce • Nike and the “swoosh” • Coca-Cola (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Registration with the U.S. Patent & Trademark Office (USPTO) • Gives the trademark owner the right to sue for infringement and dilution • Same word can be used as a trademark for different classes of products • Word can only be used as a domain name by one product (c) 2004 West Legal Studies in Business A Division of Thomson Learning

What Prerequisites Necessary for a Trademark? • Must be distinctive – capable for identifying the source of a particular good. • USPTO’s five categories of words: • Generic • Descriptive • Arbitrary or Fanciful • Suggestive • Fanciful (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Generic • Describes the general category to which the underlying product belongs: computer, apples, bread • Gets no protection • A trademark can become generic • coke, kleenex, xerox, etc. (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Descriptive • Directly describes, rather than suggests, a characteristic or quality of the underlying product: Holiday Inn, All Bran, Vision Center • Cannot be registered - Not inherently distinctive until it has acquired a “secondary meaning” (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Service Mark • Words, phrases, logos, or other graphic symbols that identify and distinguish the services of a company • Put “sm” next to the mark • Example Jiffy Lube (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Trade Dress • Protection can extend beyond the words, symbols and phrases to other aspects of the product, such as its color or design or shape or of its packaging • McDonald’s (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Web Page Design as Trade Dress • Two Pesos, Inc. v. Taco Cabana, Inc. • Court: Do not need secondary meaning • Wal-Mart Stores, Inc. v. Samara Brothers, Inc. • Court: Do need secondary meaning of design of children’s clothes to be established • distinguished Two Pesos because that trade dress was packaging • Harder now to get web page design protected as trade dress (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Registering the Mark with the USPTO • Must be capable of distinguishing the applicant’s goods, and/or services from those of others. • Must be using or have a good faith intent to use the mark (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Registration • Gives the party the right to use the mark nationwide, even if actual sales are limited to only a limited area. • Cannot, even with registration, make someone who was already using it in a given geographic area without registration stop using it in that area • Registration constitutes nationwide constructive notice to others that the trademark is owned by the party • Party can bring an infringement suit in federal court • Allows recovery of attorneys’ fees, and the potential for recovery of treble damages • Registration, after five years, becomes incontestable, and use of it is conclusively established • Circled R denotes actual notice of ownership (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Duration of a Mark • Lose trademark if: • Abandonment • No renewal of registration in the fifth year, expires at the end of the sixth year • Improper licensing or assignment • Genericity – becomes generic • Kleenex, xerox (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Secondary Meaning: • A descriptive mark can become distinctive • when the consuming public primarily associates that mark with a particular producer, rather than the underlying product • Holiday Inn has acquired this secondary meaning; public thinks of a particular chain of motels, not just any motel where people stay on holidays (c) 2004 West Legal Studies in Business A Division of Thomson Learning

How to Establish Secondary Meaning • Descriptive marks cannot be registered until they acquire a secondary meaning • Courts’ test for secondary meaning: • The amount and manner of advertising under the term • The volume of sales under the term • The length and manner of the term’s use • Results of consumer surveys in recognition of a particular product, dress, or service (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Supplemental Register • May be registered on the Supplemental register – if it remains on this register for 5 years with continuous use in commerce, it is presumed that it has acquired secondary meaning. (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Establishing Secondary Meaning of Web pages • Register on the Supplemental register • Put ® to give actual notice of ownership • Register it as a domain name • NSI, now ICANN (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Domain Names • Created to serve a useful mnemonic means of locating specific computers on the Internet • Domain names are now highly visible in “real space” • Domain names can only link to one site, while trademarks can be used by two non-competing products • Many internet users “guess” at domain names (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Domain Name System • Until 1998 domain name system • was administered by the U.S. government (ICC) via contracts with the Internet Assigned Names and Numbers (IANA) and Network Solution, Inc. (NSI) • IANA: • administered the Internet address system through Jon Postel, who had volunteered to keep a master list of machine numbers and their correlating mnemonic names over 30 years ago. • NSI • registered domain names for the top level domains of .com .org .net. – new ones: .biz, .info, .museum, .areo, .coop, .name, .pro, (c) 2004 West Legal Studies in Business A Division of Thomson Learning

U.S. decided to turn the DNS over to private management • 1999 U.S. government • turned system over to Internet Corporation for Assigned Names and Numbers (ICANN) • Supposed to open up domain-name registration to competition • can now register through a variety of registrars. (VeriSign) • Registrars located in many countries • ICANN maintains authority over them • Created UDRP (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Cannot Sue Registrars for Trademark Infringement • These registrar’s cannot be sued for giving Person B a domain name that contains Person A’s trademark • Lockheed Martin Corp. v. Network Solutions, Inc. • Motion Picture Arts and Sciences v. Network Solutions, Inc. (c) 2004 West Legal Studies in Business A Division of Thomson Learning

ICANN Domain Name Dispute Resolution • Can settle disputes involving domain name holders being sued by trademark name holders • Administrative Panel Decision Julia Fiona Roberts v. Russell Boyd 2000 (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Trademark Infringement • Plaintiff must have prior rights in the trademark- easily proved by registration • The infringer must have used the trademark in connection with the sale of a good • There must be a “likelihood of confusion” for the consumer as to the source of those goods or as to the sponsorship or approval of such goods (c) 2004 West Legal Studies in Business A Division of Thomson Learning

“Likelihood of Confusion” Factors Used by Courts: • Strength of the mark • Proximity of the goods • Similarity of the marks • Similarity of marketing channels • Degree of caution exercised by the typical purchaser • Defendant’s intent • Evidence of actual confusion • Zone of natural expansion by plaintiff • Length of time defendant used the mark • Same sales efforts (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Infringement Examples • Check Point Systems, Inc. v. Check Point Software Technologies, Inc. • Apple computer and Apple records can co-exist – no confusion to consumer • Applet computer would be an infringement (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Trademark Dilution • Federal Trademark Dilution Act 1996 • Only if the mark is registered • Only if the mark is famous and distinctive • Defendant’s use is causing dilution (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Dilution Can be Blurring or Tarnishment • Lessening of the capacity of a famous mark to identify and distinguish goods or services • Regardless of confusion by the consumer • Regardless of whether goods are competing (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Test for Whether Plaintiff’s Mark is Famous • Degree of inherent or acquired distinctiveness • Duration and extent of use • Amount of advertising and publicity • Geographic extent of the market • Channels of trade • Degree of recognition in trading areas • Any use of similar marks by third parties • Whether the mark is registered (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Trademark Dilution - Blurring or Tarnishment • Likelihood of confusion not necessary • Blurring: power of the mark is weakened through its identification with dissimilar goods • A.B.C. Carpet Co., Inc., et al. v. Naeini • Tarnishment: mark is cast in an unflattering light, typically through its association with inferior or unseemly products or services • Toys R Us v. Akkaoui (Adults “R” Us ) • Toys “R” Us., et al. v. Richard Feinburg (gunsareus.com) (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Fair use • Descriptive mark is used for its primary, rather than secondary meaning: like describing your cereal as “all bran” or your batter coating as “fish fry” • Nominative use: Using the words “just to talk about the object” (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Parody • Not too directly tied to commercial use • Artistic and editorial parodies of trademarks serve a valuable critical function – entitled to First Amendment protection (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Remedies • Infringement: • Defendant’s profits • Damages sustained by plaintiff • (may be trebled upon showing of bad faith) • Costs of the action • Dilution • Damages only if bad faith • Only injunctive relief (c) 2004 West Legal Studies in Business A Division of Thomson Learning

A New Remedy - Anticybersquatting Consumer Protection Act (ACPA) • 1999 Protect trademark owners from cyber piracy • “A person shall be liable in a civil action by the owner of a mark, including a personal name which is protected as a mark,… if that person had a bad faith intent to profit from the mark” • Also illegal to register the domain name of a living person without his consent • Statutory damages or actual damages (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Indications of Bad Faith Under the ACPA • A federally registered trademark will be diminished • Domain-name owners intend to cause diversion of consumers or or dilution of the trademark • Domain-name owners offer to sell the name to the trademark owners • Domain-name owners applied for it by providing false information • Domain-name owners applied for multiple domain names registration (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Trademark Owners Sued Infringing Domain Name Holders 1994 • Can sue for infringement, dilution, unfair trade practices, under the AntiCybersquatting Protection Act • Use ICANN’s Uniform Dispute Resolution Procedure (UDRP) • Use various dispute resolution bodies around the world • WIPO Arbitration and Mediation Center: Julia Roberts (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Domain Name Cases: • Sue for Internet Trademark Infringement • Deep linking • Ticketmaster v. Microsoft • Metatags • Playboy Enterprises Inc. v. Welles 2002 • Framing • Washington Post v. Total News, Inc. (c) 2004 West Legal Studies in Business A Division of Thomson Learning

International Protection - Treaties • Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) • WTO treaty • Comprehensive set of rights and obligations governing international trade in intellectual property • Each member country must have a common minimum of protection for intellectual property rights within its own borders • Must observe the substantive provisions of certain treaties (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Treaties That Must be Observed By TRIPS Members • International Convention for the Protection of Industrial Property (Paris Convention) • Berne Convention for the Protection of Literary and Artistic Works (Berne Convention) • International Convention for the Protection of Performers, Producers of Phonograms, and Broadcasting Organizations (Rome convention) • Treaty on Intellectual Property in Respect of Integrated Circuits (IPIC Treaty) • Supplements to these treaties set by TRIPS • Copyrights at 50 years, patents at 20, trademarks at 7 (c) 2004 West Legal Studies in Business A Division of Thomson Learning

TRIPS Also Requires • Extension of the General Agreement on Tariffs and Trade (GATT) to international intellectual property rights • National Treatment Principle • Transparency Principle • Most–Favored Nation Treatment Principle • Least developed countries have until 2006 to reach standards (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Paris Convention • International Convention for the Protection of Industrial Property • Union of countries responsible for protecting industrial property rights: patents, trademarks and industrial designs • Must comply with 3 principles • National treatment principle • Right of Priority: 12 months retroactive time to file in other countries • Common rules establish basic minimum criteria and procedures for granting industrial property rights (c) 2004 West Legal Studies in Business A Division of Thomson Learning

The Trademark Law Treaty 1994 • 35 countries • Harmonizes the following rules • Initial and renewal terms of registering trademarks is ten years • Service marks now have equal protection as trademarks • Various procedures related to renewal application, powers of attorney, authentication, streamlined (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Madrid Protocol • Single international trademark application and registration system • Managed by WIPO • Registration here is recognized as registration in any of the member countries (c) 2004 West Legal Studies in Business A Division of Thomson Learning

International Trademark Disputes of Internet Domain Names • No one treaty • Individual country efforts • United Kingdom • France • Asia (c) 2004 West Legal Studies in Business A Division of Thomson Learning

Intellectual Property