Fair Use and the Future Explored: Chip N' Dale: Rescue Rangers Movie

Yesterday, my kids and I watched the new movie, Chip N’ Dale:Rescue Rangers.  This is probably the funniest Intellectual Property law related movie I’ve seen.  Disney takes on IP Law doctrine and policy in a very humorous way.  As an exercise in understanding U.S. IP law, the facts the movie raises are very nice.  Here’s a few examples: ET v. Batman; Ugly Sonic; Chippendales; and on and on.  They also take on: a glimpse at the future of augmented reality; artificial intelligence and creativity; culture wars; Hollywood nostalgia reboots (talk about bootlegging); and the future of counterfeiting. There are so many references my brain almost exploded from overload. As a tip, be sure to take in the background materials, e.g., advertisements. Lol. They take some pretty nice shots at competitors, but I wonder what’s going to come back.  Interestingly, the Pirates of the Caribbean ride at Disneyland has been closed for “refurbishment.”  [In full disclosure, I am a very big fan of Disney and may be extremely biased.]

"Decluttering" the U.S. Trademark Register?

The USPTO recently announced that “foreign-domiciled trademark applicants, registrants, and parties to [TTAB] proceedings" must secure a U.S. attorney.  At least part of the justification for this new requirement is the filing of apparently fraudulent applications.  This may help declutter the U.S. Trademark Register—to the extent you believe there is a clutter problem.  I plan to open my own law office soon to provide low cost and quality U.S. trademark services (lol).  Here is some more detail concerning the requirement with helpful links to more information: 

• Foreign-domiciled trademark applicants, registrants, and parties to Trademark Trial and Appeal Board proceedings, including Canadian trademark filers, must be represented at the United States Patent and Trademark Office (USPTO) by an attorney who is licensed to practice law in the United States. See more about foreign-domiciled trademark applicants, registrants, and parties.
• U.S.-licensed attorneys representing trademark filers must provide all of the following:
• Their name, postal address, and email address
• A statement attesting to their active membership in good standing of a bar of the highest court of a U.S. state, commonwealth, or territory
• Information concerning their bar membership (state, number if applicable, and year of admission).

      See more about U.S.-licensed attorneys.

• Canadian patent agents will no longer be authorized to represent Canadian trademark applicants, registrants, or parties before the USPTO in trademark matters. See more about Canadian patent agents.
• Canadian trademark attorneys and agents will continue, if eligible, to be recognized as additionally appointed practitioners who can represent their Canadian clients, although the USPTO will correspond only with the appointed U.S.-licensed attorney. See more about Canadian trademark attorneys and agents.

Solutions in Search of a Problem: The Trademark Register Clogged?

Commentators have debated the question of whether there are too many trademarks.  Are we going to end up in a situation where there just are not enough good trademarks left, particularly wordmarks?  Some would argue that there is an inexhaustible supply of potential trademarks, particularly when considered with words and designs in combination.  A recent Wall Street Journal article asserts that U.S. intellectual property officials are concerned about a large number of applications filed in the United States by Chinese companies and citizens.  Apparently, part of the concern is with fraudulent applications. 

One of the curbs on excessive use of trademarks in the United States is the use requirement.  For most filings in the United States, there must be a use--or eventually a use with an intent to use based application.  Interestingly, CompuMark has released a survey which states that China will become the leader in trademark filings domestically and in the world by 2020.  According to CompuMark, China has filed "nearly 120,000 foreign trademark applications in 2017."  And, the number of trademark applications in the U.S. by Chinese companies or individuals has increased by 800% since 2014.  The Chinese trademark registry now has "over 5 million new trademark applications in 2017" and sixty percent of the trademark registrations in the world are in China.  In the U.S., trademark registrations stay in effect for a basic ten year term after the first five years.  

Let's assume there is a problem.  The problem is there aren't enough good trademarks for legitimate businesses and there's a potential for hold-up of legitimate businesses by "weak" marks.  I suppose another related problem is the increase in search costs due to avoiding a massive number of marks.  Some of our solutions could include increasing filing fees and maintenance fees.  Another solution is shortening the time periods for requiring fees.  The U.S. has very long terms.  We could shorten them to two to three years.  We could increase penalties for the filing of fraudulent marks, including increased penalties for the US attorney who files the marks.  We could lower the costs for challenging existing marks.  We could also create a way to dismiss spurious suits for trademark infringement early and penalize over-enforcement through cease and desist letters.  Many of these solutions have been proposed.  Is there a problem?  

China Sends a Message: Invest in Me

In recent posts (here and here), I have discussed China’s increased protection of intellectual property rights.  Recently, Ian Harvey, the chair of the IP Center Advisory Board at Tsinghua University x Lab in Beijing, sent me his excellent paper on China’s IP law.  Notably, his paper outlines how China’s enforcement of intellectual property has improved and does not deserve its past reputation.  Powerpoint slides relating to his paper are available, here. 

Recently, China’s Supreme People’s Court issued a ruling recognizing Michael Jordan’s rights to his name in Chinese characters.  This decision sends a powerful message both in China and outside China that intellectual property rights will be respected.  Importantly, this is the enforcement of IP rights that were arguably not secured by Michael Jordan in China and there are strong reliance interests by the Chinese company.  I believe the symbolic importance of this decision cannot be overstated.  Interestingly, there are more reports concerning venture capital moving from the United States to Europe and China because of recent developments in U.S. intellectual property law, such as the Alice decision. What will be Donald Trump's reaction?  For more on the decision, please see the New York Times article, Michael Jordan Owns Right to His Name in Chinese Characters, Too, Court Rules. 

Brexit and IP Practice: What does it mean?

As we all know, Brexit happened yesterday (I guess depending on your time zone).  I am disappointed by the vote, but that is democracy.  It was relatively close, but over 17 million voters unhappy with the status quo is significant.  I am not a European IP attorney, but I thought it might be helpful to collect some of the links to advice concerning the IP fallout from Brexit.  Here are a few: 

Freshfields Bruckhaus Deringer

Carl Oppendahl

Afro IP via Darren Olivier (Brexit implications for Africa)

Fashion Law Blog

Olswang

Foley & Lardner via National Law Review

Kluwer Patent Law Blog

Shepherd Wedderburn

Bird and Bird

World Intellectual Property Review

Mylan's EpiPen: Losing a Billion Dollar a Year Business Because of Trademark Choice and Usage?

In a recent Bloomberg Business article, How Marketing Turned the EpiPen into a Billion Dollar Business, authors Cynthia Koons and Robert Langreth describe how Mylan turned a $200 million a year combination drug and device auto injector of epinephrine—used to help people with emergency allergic reactions to peanuts and other substances—into billion dollar revenues.  Brilliantly, Mylan’s CEO Heather Bresch decided to focus on outreach to parents with children with allergies--along with careful attention to legislation.  After significant marketing—read education—and taking advantage of a substantial increase in allergies in children, Mylan worked with Congress to pass federal legislation “encouraging states to have epinephrine devices on hand in schools.”  According to the article, 47 states now require schools to have epinephrine devices available.  Mylan has given free EpiPens to 59,000 schools and spent 34.2 million on advertising the EpiPen in 2014 alone. Mylan also is working on legislation to require access to epinephrine devices at restaurants, hotels “and anywhere people congregate.”  Mylan also has raised the price of the EpiPen “32% in the last year”—perhaps feeling the pressure coming. 

What is the pressure?  A generic competitor and possibly genericide of the EpiPen mark.  A generic version of the EpiPen may hit the market this year pursuant to a settlement with Teva Pharmaceuticals—well before expiration of several of the patents covering the EpiPen.  Mylan does not appear to be worried.  Bresch stated: “You [will] not see the traditional market loss because of just the brand equity with EpiPen.”  I am not as optimistic because of the potential genericide of the EpiPen mark.  Genericide, and the consequential loss of protection for a mark, occurs when a mark essentially losses its ability to indicate the origin of the source of goods and merely becomes the word for the goods.  For example, marks such as Escalator and Elevator have lost trademark significance because the public came to understand those terms not as trademarks, but as names for classes of goods.  Ordinarily, a trademark for the patented product does not automatically become generic when a patent term ends.  However, it is possible that it might—depending on consumer understanding.  Mylan has a potential problem because of the incredible success of its device and the choice of a relatively non-distinctive mark—using the first three letters of the active drug ingredient coupled with a descriptive word for the appearance of the patented device.  Additionally, the stocking of EpiPens at schools may lead parents to believe that EpiPens are “the” product to be used to treat emergency allergy problems. 

Interestingly, most pharmaceutical related trademarks must not only qualify for trademark protection, but are also regulated by the Food and Drug Administration and other regulatory bodies to ensure that there is not confusion with other pre-existing pharmaceutical related trademarks—particularly with prescribing physicians--and that they do not mislead as to purpose or effect.  Moreover, some case law in the U.S. requires a lower threshold for proving trademark infringement for pharmaceuticals because of the increased danger to human health associated with customer confusion with pharmaceuticals.  Thus, there is essentially a higher level of scrutiny applied to pharmaceutical trademarks which could lead to a court or the US Patent and Trademark Office to lean toward a finding of genericide in a close case.  Notably, the Bloomberg News article stated:  “And for doctors, who write prescriptions for the name they know best, the EpiPen brand “is like Kleenex,” says Robert Wood, a pediatric allergist at Johns Hopkins University School of Medicine.”

Mylan may still have time to work on its trademark issues, but this case study highlights the importance of choice of trademark and monitoring trademark usage by relevant audiences.

The Cost to Develop a New Name for a Product: $3,000 to $75,000?

In a recent entertaining and informative article, The Weird Science of Naming Products, by Neal Gabler, published in the New York Times Magazine (January 15, 2015), Mr. Gabler discusses the process of choosing a name for a new product or service for a technology company in Northern California.  Notably, the article discusses the process of choosing a name by brand guru Anthony Shore.  Mr. Shore has created names such as Soyjoy and Yum!.  The article also describes the results of a study on the relationship between sounds of different words and emotions, and the use of that research to develop brands.  The article spends about a paragraph noting the importance of trademark law and the impact of preexisting marks.  Interestingly, the article does not discuss consumer studies of the potential names for products.  It notes that it costs about $3,000 to $75,000 US to develop a name, but tens of millions to establish the name in the marketplace.  Does that cost sound about right?  It seems low to me.  Any other estimates for the cost to develop a name? 

YUM Brands has Trials in China: A “Social Ideology” Fix to the Problem?

YUM Brands (YUM), the owner of KFC and Pizza Hut, has generally enjoyed enormous success in China for a “foreign brand”.  The success has been attributed to a strong first mover advantage.  And, the brand is, of course, critical to that first mover advantage.  However, YUM has struggled with issues concerning “trust,” first because of “excessive antibiotics and hormones,” which led to around a 40% drop in sales.  According to several news outlets, here and here, foreign brands are at a disadvantage to “home grown” brands in China because the news media in China is supposedly more inclined to criticize foreign companies.  So, the issue has been how to effectively rebuild trust with consumers in a foreign brand after a scandal in China.  YUM Brands became a model of success after the “antibiotics scandal” by taking immediate action:

Promis[ing] to test meat for banned drugs, strength[ing] oversight of farmers and encourag[ing] them to improve their technology. It said more than 1,000 small producers used by its 25 poultry suppliers have been eliminated from its network.

The success of the strategy (along with some tasty chicken and a better economy) appears to have helped sales bounce back 11% at KFC the past year, as reported by the BBC.  However, YUM is facing troubles again.  News has just broke about another scandal concerning the use of “expired” chicken.  What can YUM do to fix its brand?  One possible strategy was discussed in a Forbes article by Avi Dan on the information age and brand loyalty:

Do well by doing good: Marketing is no longer an economic function alone, but a social force as well. Within minutes of the Haiti earthquake, donations requested on Twitter started flowing in via text messages in coordination with the phone company. Pepsi bypassed the Super Bowl for the first time in 23 years, and instead of buying $3 million spots in the game, announced on its Facebook page that it will donate $20 million to worthy causes. Social ideology increasingly reinforces brand loyalty.

I don’t know if this strategy worked well for Pepsi, but YUM may need some new ideas.  Has this strategy worked well for other companies in dealing with a scandal?  For sure, brand owners carefully manage their image.  And, the first mover advantage is helpful, but it relies on a strong brand and if the brand fails (again), then what do you do to maintain a competitive advantage. . . . 

The Controversial Mark is Back in the News and a Bad Example to Boot

I’ve written about the infamous mark, here.  Miri Frankel just wrote a very nice post at the IPKat about how the United States Patent and Trademark Office has refused to register a mark with that you know what word in it.  And, the Washington Post recently published this article, “[football team] owner Dan Snyder makes visits to Indian Country amid name-change pressure.”  Apparently, Dan Snyder has been making secret trips to Indian Country to get a first-hand look at the living conditions of some Native Americans.  What?  Really?  I am very surprised I had not heard about this and some media outlets have covered some of the visits—although it is supposed to be a “secret.”  I am encouraged that Mr. Snyder is making this effort.  Here is a Snyder friend’s account:

A friend of the Snyder family explained it this way: “Why is he making these trips, and why so secretly? Certainly it’s been triggered by all the attacks on him as a racist for loving the name ‘Washington [].’ So there is no question there is a link. But his feelings about the pain and depression — depression is the word he has used with me — of Native Americans who have no jobs, who have obesity issues, whose children are suffering, is profound and real.”

The Snyders have made large charitable donations in the past, contributing millions to Children’s National Medical Center and the National Center for Missing & Exploited Children in Alexandria.

The friend, who asked not to be identified because the team did not authorize him to speak on the matter, said he told Snyder that he should let people know about these trips.

“And his answer to me was: ‘Don’t you dare. They will falsely accuse me of doing this for material reasons, and I don’t want to give them that satisfaction when, in fact, I know that’s not true.’ ”

One very interesting part of the article is a discussion about the power of social media and how “public relations issues” just don’t go away anymore--welcome to the Internet.  The article notes that issues take on a life of their own and may not be pushed away by a nice check.  Of course, this highlights the importance of carefully considering a mark before adopting it—and I suppose you should consider how the mark may be perceived in the future in an evolving society, to the extent you can.  Ultimately, I don’t think Mr. Snyder will be able to find an easy middle ground.  And, he will probably change the name—that may be all that is acceptable to those who will continue to push and push because this isn’t going to go away for him.  And, the fact that Mr. Snyder doesn’t change the name may provide “bad" inspiration for others not to change their troubling team names, such as the Arabs high school football team in California. (discussion here, and see their "design" here—top left of the page).  What do you think of that mark (word and design)?

The LOTR and the One Armed Bandits: Part I

I love J.R.R. Tolkien’s Lord of the Rings and the Hobbit.  I’ve loved the books since I was a child and I love the movies as an adult.  I am sure there are other fans who love LOTR and the Hobbit more than me, but I am at least in the class of persons who owns multiple copies of the books, purchases tickets to the movies, buys the DVDs when they are released, purchases the DVDs that include the extended versions of the movies, and buys the video games based on the movie.  I am not in the class of fans that follows litigation concerning the LOTR and am thankful for LK Shield’s Deirdre Kilroy’s lead to this litigation.

On November 19, 2012, Fourth Age Limited, trustee for the Tolkien Trust, J.R.R. Tolkien Estate Limited, Harper Collins Publishers and others filed a complaint for: (1) Copyright Infringement; (2) Breach of Contract (3) Declaratory Relief -- Gambling Games and Downloadable Games; and (4) Declaratory Relief --Trademarks Service Marks and Services Licensing in Federal court, in the Central District of California (Los Angeles is located in the Central District), against Warner Brothers Digital Distribution, New Line Productions, Saul Zaentz Company d/b/a Middle-earth Enterprises, and others.   (Zaentz recently filed a counterclaim, which I’ll hopefully discuss soon).

The suit essentially revolves around the interpretation of a clause concerning merchandising rights in a 1969 license covering the film rights.  The complaint states that:

Specifically, defendants' predecessors-in-interest obtained the limited right to use the characters, places, objects and events referred to in The Lord of the Rings and The Hobbit "solely and only upon and in connection with the manufacture, sale and distribution of ... any and all articles of tangible personal property, other than novels, paperbacks and other printed published matter..." . . .  The original contracting parties thus contemplated a limited grant of the right to sell consumer products of the type regularly merchandised at the time (such as figurines, tableware, stationery items, clothing, and the like). They did not include any grant of exploitations such as electronic or digital rights, rights in media yet to be devised or other intangibles such as rights in services. To emphasize the limited nature of the grant, plaintiffs' predecessors-in-interest specifically reserved "the right to utilize and/or dispose of all rights and/or interests not herein specifically granted."

The Defendants apparently gave permission to a company that produces gaming equipment and more specifically slot machines to produce slot machines and an online game.  And, according to the complaint, many fans are not happy about this development—very unhappy.   Many also know that the LOTR and the Hobbit are viewed as incorporating Christian and Catholic meaning, but what does that mean (particularly with respect to IP claims)?  As a fan, I must say that I am not outraged, but which fans matter?  Other works of art have been apparently licensed to produce gambling devices such as the Wizard of Oz’s The Great and Powerful Oz slot machine.  (or is that fundamentally different because someone would create a Wizard of Oz slot machine?)  I can understand, of course, how the Plaintiffs want to protect the image associated with its brand and how other fans are upset; however, I am not sure that an argument that is essentially “we never would have agreed to allow this type of merchandising because it would upset our fans and is inconsistent generally with the merchandising of great works of art” is always true? Although once the court sorts out the trademark rights in the license in favor of the Plaintiffs, then Defendants and their licensees will cease selling slot machines and other gambling devices under the trademarks.  The fourth claim for declaratory relief states:

a. For a declaration that defendants do not have the right to license or exploit any services in any categories, nor the ability to register, use or exploit service marks in any categories in connection with The Lord of the Rings and/or The Hobbit; and

b. for a declaration of the parties' respective rights and obligations under the Merchandising License as they relate to the registration and/or use of Lord of the Rings and/or Hobbit-related trademarks and/or service marks and/or the ability to license or exploit services.

Is the value of the brand hurt by licensing the production of gambling devices?  I suppose it depends on the nature of the work, but from who’s perspective?  The LOTR is relatively violent.  What do you think?

Is Nothing Sacred? Samsung Takes Its "Anti-IP" Case to the People.

The American Football championship—the Super Bowl—is this weekend.  And, along with it, there is the opportunity to capture the attention and imagination of the American consumer (and make a few bucks)—and IP issues abound.  The two teams playing are the San Francisco 49ers and the Baltimore Ravens.  Interestingly, the teams are coached by brothers.  The 49ers a.k.a. Niners are coached by Jim Harbaugh and the Baltimore Ravens are coached by John Harbaugh.  An entrepreneurial fan last year attempted to obtain a trademark registration for the “Harbowl” and “Harboughbowl.”  The National Football League (NFL) pressured the fan to abandon his trademark application.  The NFL is notorious for enforcing the Super Bowl trademark.  And, we have heard about the “Kaepernicking” trademark from fellow blogger Neil Wilkof. 

Now Samsung is taking the game to a new level.  One of the traditions of the Super Bowl is the anticipation and viewing of creative commercials during the game.  Indeed, some fans enjoy the commercials during the Super Bowl more than the game itself, and every year people always ask—what was the best commercial.  This year Samsung has an early strong entry that is getting play with the media already.  Samsung is taking its “IP law and enforcement is out of control" message to the American consumer—a continuation of its theme from the Apple v. Samsung case.  Here is the commercial.

 

What do you think?  I wonder if I'll get a cease and desist letter from the NFL for using "Super Bowl" in this blog entry.  Anyone care to analyze the issues?

The Controversial Mark: Is Image Everything and is all Publicity Really Good?

One of the most famous American football teams in the United States is the Redskins based in Washington DC.  And, perhaps the most famous case involving potentially scandalous or disparaging trademarks in the United States, is a number of decisions involving the Redskins trademarks—the Harjo v. Pro-Football, Inc. case.  In that case, the plaintiffs, a group of Native Americans, attempted to cancel the federal trademark registrations of the Washington Redskins football team.   And, as many know, the case ended with a less than satisfactory result for some—basically the Plaintiffs are unable to proceed because they unreasonably delayed in asserting their claim to the prejudice of the Defendants. 

The Redskins issue and the general controversy has resurfaced again for at least a few reasons.  At least one university has attempted to reintroduce and use some Native American imagery with its football team—the Eastern Michigan University marching band recently sported their previously spurned Native American imagery at a football game.  There is apparently a new group of plaintiffs going after the Redskins federal trademark registration.  And, the Washington Redskins have been thrust back in the national spotlight because it had an unbelievably good season and an equally unlikely good season behind its incredibly talented first year quarterback, Robert Griffin the III, also known as RG3.  This good season came to an abrupt halt a week ago when RG3 was injured and the team lost in the playoffs.  After the loss and with it the inevitable Monday morning quarterbacking, a columnist for the Washington Post took a different approach to criticize the team and used the publicity and popularity of the game to redirect attention to the Redskins trademark controversy.  He took an unusual approach though.  He basically asserted that the Redskins lost because of “karma” based on the retention and use of their asserted offensive trademark—something like "the universe has spoken superstitious sports fans and you deserve this loss and the possible loss of RGIII because you continue to refuse to put enough pressure on owner Dan Snyder to change your insulting name."  Ignoring other important issues, if you were attempting to value this mark, how would you discount the unpopularity of the mark with some people—particularly those people who are not Redskins football fans?  Does that even matter?  Does this hurt the Redskins in its or its’ players ability to sponsor or endorse other brands (or receive sponsorships—apparently not with some like FedEx)?  (RGIII also endorses Subway sandwiches.)  What if you knew some Redskins fans refused to buy merchandise sporting the Redskins name and logo because they thought the name and logo were in “poor taste?”  Do you think the Redskins would be more or less popular (or the mark more or less valuable) if they changed their name to something like the “Presidents?”  Would the existing fans have to go out and buy updated merchandise?  In considering these issues, do sports teams raise different issues than say blanket manufacturers?

One of my favorite decisions is Sporting Kicks Ltd’s Application involving the attempted registration of the words “Inter City Firm” in connection with clothing, badges and other items (well, it involves Football, aka soccer, raises all sorts of interesting issues, and involves a trademark).  The decision concludes that the mark is not registrable because its registration would be contrary to public policy—the mark references a group of football hooligans (If you haven’t seen the movie Cass, I recommend it).  The decision includes some very interesting language: “Such a sign falls within a category of marks that may be described as “anti-social branding.”  Is the mark "Redskins" a form of “anti-social branding?”  Not of the team, its players and fans, but of the people it may be perceived as referencing?   How important and/or reinforcing is a consistently presented image through a mark?  Have you seen this video—it is worth well more than a few minutes of your time.  Should the Redskins federal registration be cancelled because the United States shouldn’t stand behind such a mark, as others have raised—apparently giving it a stamp of approval?  The Smithsonian will confront some of these issues at a symposium in February titled, “Racist Stereotypes and Cultural Appropriation in American Sports.”