Posted On: February 29, 2008

Chicago Cubs Sue Rooftop Spectator Facilities For Trademark Infringement And Unfair Competition Under The Lanham Act

Watching the Cubs play at Wrigley Field is a nostalgic indication of summer (except for the playoffs), especially when cameras pan out to the bleachers and the rooftop spectators overlooking the field. The Chicago Cubs filed a trademark infringement and unfair competition lawsuit on February 15, 2008 to prevent rooftop facility owners from charging patrons to watch the game from the rooftops that overlook Wrigley Field. The Cubs sued numerous rooftop operators in 2002 for copyright infringement and several state causes of action. The previous lawsuit settled with the rooftop operators agreeing to give the Cubs 17% of their gross revenue. Last year, the rooftops reportedly raked in $18 million dollars, resulting in a windfall of about $3 million for the Cubs.

cubs%20-%20rooftop%20pic.jpgTom Gramatis was one of the original defendants in the 2002 lawsuit and settlement agreement and he has recently built two additional buildings with rooftop seating. The Cubs allege that Gramatis breached their settlement agreement by not paying the agreed upon royalties and has not paid any royalties for the new buildings. Interestingly, the Cubs have dropped their dubious copyright infringement claim from this lawsuit – undoubtedly a lesson learned from 2002 – and only assert that Gramatis is infringing on the Cubs’ trademarks and falsely advertising an association with the team in his promotional material and website. The Cubs allege that “Defendants’ marketing efforts are, and have been, likely to cause confusion, to cause mistake or to deceive as to, inter alia, the affiliation, association or connection between Defendants and the Cubs and the Cubs’ approval or sponsorship of Defendants’ business activities.” Chicago National League Ball Club, LLC v. Wrigley Rooftops III, LLC, 08-cv-968 (N.D. Illinois).

PRACTICE NOTE: In essence, the Cubs are trying to assert a copyright claim that they don’t have. It is highly unlikely that the Cubs would settle the lawsuit if Gramatis agreed to market his rooftop facilities as “a high perch with a view of a game played with a ball, a bat, no steroids or HGH, a diamond field, where the team’s logo incorporates a hibernating mammal.” On second thought, he might be dragged before Congress with a false advertising charge for the "no steroids or HGH" quip.

Posted On: February 28, 2008

Hong Kong Based Manufacturer Of Air Hogs And Havoc Helicopter Toys Files Patent and Copyright Lawsuit In Los Angeles

Los Angeles, CA – Patent infringement and copyright litigation complaint over toy helicopters was filed in Central District Court of California, Los Angeles, by Hong Kong based Silverlit Toys Manufactory, LTD. and its Canadian distributor. Plaintiffs design, manufacture, develop, and market toy product for children and sell the toy under its federally registered trademark Air Hogs® Havoc Heli™ Helicopters, in addition to track racing systems, robot toys, and water toys. Plaintiffs have issued United States Patents on the toy helicopter: U.S. Design Patent No. 546,269; U.S. Design Patent No. 552,531; U.S. Design Patent No. 554, 040, and U.S. Design Patent No. 544,825. They also have a registered copyright certificate with the U.S. Copyright Office, Copyright Registration No. VAu694-351. Plaintiffs claim that “the Air Hogs® Havoc Heli™ Helicopters is an original decorative design that is easily distinguishable from traditional remote control toy helicopters” and has been recognized by “the Guinness Book of World Records as the world’s smallest commercial toy remote control helicopter.” Plaintiffs further allege that Air Hogs® Havoc Heli™ Helicopter was the number one best selling remote control toy of 2007.

Helicopter%20Pic.jpgThe defendants, Soft Air USA, Inc. and a subsidiary of Sports Authority, are accused of copying and selling toy helicopters that infringe on Plaintiffs’ Air Hogs® Havoc Heli™ Helicopter’s patents and copyrights. Plaintiffs allege that Defendants’ helicopters are identical to the Air Hogs® Havoc Heli™ Helicopter that “Defendants’ knock off helicopters were recently recalled after an investigation by the Consumer Product Safety Commission in response to consumer complaints that the rechargeable battery packs were catching fire.” Plaintiffs continue that they were “bombarded with calls from customers who mistakenly believed that Defendants’ inferior and dangerous knock off product was made by Silverlit.” Plaintiffs allege that customers believed that the Defendants’ voluntarily recall included the Air Hogs® Havoc Heli™ Helicopter and returned the genuine product to Plaintiffs. The case is styled as: Silverlit Toys Manufactoy, LTD v. Soft Air USA, Inc., CV08-01053 JFW (C.D. California).

PRACTICE NOTE: In order to preserve their good will and reputation with their customers and the public, it is important for intellectual property owners to immediately enforce their rights against infringers to stop the influx of unauthorized product of inferior quality.

Posted On: February 27, 2008

Chanel Sues Over Counterfeit Jewelry That Infringe On Its Trademarks and Trade Dress In Riverside, California

Los Angeles, CA – On February 20, 2008, Chanel, Inc., the luxury goods company, filed a complaint for counterfeiting, trademark infringement, and Lanham Act 43(a) unfair competition against numerous individuals in the California Central District Court – Eastern Division, in Riverside. Chanel asserts that it is the owner of the USPTO registered trademarks CHANEL and the CC MONOGRAM for use on necklaces and costume jewelry, including earrings, rings, bracelets, and pendants in International Classes 14 and 28. Chanel asserts that its trademarks are “symbols of Plaintiff’s quality, reputation, and goodwill” and customers “readily identify merchandise bearing the Chanel Marks as being high quality merchandise sponsored and approved by Chanel.”

chanel-monogram.gifChanel alleges that Defendants are “promoting, and or otherwise advertising, distributing, selling, and/or offering for sale counterfeit products, including at least necklaces and costume jewelry bearing trademarks which are exact copies of Chanel Marks” and are counterfeit, lower quality goods that also incorporate Chanel’s trade dress. The complaint further alleges that the “net effect of Defendants’ actions is to confuse consumers who will believe Defendants’ Counterfeit Goods are genuine goods originating from and approved by Chanel.” In addition to preliminary and permanent injunctive relief, Chanel seeks three times its actual damages under 15 U.S.C. § 1117, or, at its election, seeks statutory damages of $1,000,000.00 (one million dollars) from each defendant under 15 U.S.C. § 1117(c)(2) of the Lanham Act. The case is styled as Chanel, Inc. v. Kin Fung Poon et al., EDCV08-0224 VAP (CD CA 2008).

PRACTICE NOTE: The Ninth Circuit Court of Appeals recently held that if a trademark owner seeks counterfeiting statutory damages under 15 U.S.C. 1117(c) – instead of actual damages, then it is not entitled to attorneys’ fees under section 1117(b). K and N Engineering, Inc. v. Bulat, 510 F.3d 1079, 1081 (9th Cir. 2007). The Ninth Circuit vacated the trial court’s award of $100,000 to K and N, but let stand the $20,000 in statutory damages. In counterfeiting cases where the actual damages are low, Plaintiffs must weigh the option of receiving lower actual damages and their attorneys’ fees, against the award of higher statutory damages and no attorneys’ fees.

Posted On: February 26, 2008

Copyright Infringement Lawsuit Filed in Los Angeles Over Clothing Fabric-Textile Design Copyright

Los Angeles, CA – On February 15, 2008, Star Fabrics, Inc. commenced copyright litigation in California Central District Court over textile/fabric design copyrights, which apparel bearing the design is allegedly sold at Ross department stores and were manufactured by US Textile Printing, Inc. and Uno Clothing, Inc. Star Fabrics claims to have purchased all rights in the design which it then transferred to fabric. Star Fabrics registered the design with the U.S. Copyright Office and received Copyright Registration No. VA 1-418-127.

The complaint alleges that Plaintiff sent cease and desist letters to all of the defendants – who refused to stop selling the garments and/or fabric. As a result, Star Fabrics’ lawsuit makes a claim for copyright infringement 17 U.S.C. § 101 et seq. It also adds a second claim for vicarious and/or contributory copyright infringement, alleging that defendants “knowingly induced, participated, aided and abetted in and resultantly profited from the illegal reproduction, importation, purchase and distribution and/or sales of product featuring” the copyrighted design.

PRACTICE NOTE: Although copyright laws currently protect patterns and designs printed on or stitched into the fabric, copyright protection is not currently available to protect fashion designs themselves (i.e. the cut, style, or dimensions of clothing). However, the Design Piracy Prohibition Act (H.R. 5055) bill is currently pending in congress that, if enacted into law, will provide three years of protection for the fashion design if certain conditions are met. Click Here To Read About The Bill.

Posted On: February 25, 2008

Rembrandt Wins $41 Million Patent Infringement Jury Award Against CIBA Vision

A jury awarded patent infringement damages of $41,083,853.00 to Rembrandt Vision Technologies, L.P. in its patent infringement trial against CIBA Vision Corporation. Rembrandt Vision Technologies, L.P. v. CIBA Vision Corporation, 2:05-CV-491 (E.D. Texas). The patent infringement lawsuit commenced in 2005 when Rembrandt originally accused both Bausch and Lomb – which settled before going to trial – and CIBA of infringing on U.S. Patent No. 5,712,327. The asserted patent relates to long-term extended wear contact lenses which are more gas permeable, allowing for oxygen exchange, and retain moisture.

ciba-logo.gifRembrandt is a non-practicing patent holding company – i.e. they don’t manufacture products, they merely file patent infringement lawsuits. As Forbes.com reports, Rembrandt’s parent “has raised $150 million to purchase patents and sue companies it claims infringe on them.” Forbes also reports that numerous patent assertion companies are being funded by institutional investors and hedge funds.

PRACTICE NOTE: Rembrandt’s strategy in settling with Bausch & Lomb raised concerns for co-defendant CIBA. In eBay, Inc. v. MercExchange, LLC, 126 S. Ct. 1837 (2006), the Supreme Court limited the ability of non-practicing patent holders from obtaining permanent injunctions. In an attempt to overcome the eBay decision, Rembrandt – because it is non-practicing patent holder – has reportedly given Bausch & Lomb – who manufactures the product – the right to seek a permanent injunction against infringers.

Posted On: February 22, 2008

Lanham Act Unfair Competition And False Advertising Lawsuit Filed by Orthopedic Development and MinSurg Against Viking Craft Spine In Santa Ana, CA, With Patent Infringement Lawsuit Lurking

Litigation commenced in Central District Court of California, Santa Ana Division, alleging unfair competition under the Lanham Act 43(a), 15 U.S.C 1125. Plaintiffs, Orthopedic Development and MinSURG Corp., are the owners of a patent-pending TruFUSE® medical device product which is a spinal facet fusion system invented by Dr. David A. Petersen, M.D., “that offers a low-risk and minimally invasive surgical solution to back pain resulting from facet joint degeneration and from mild spinal instability.” The complaint alleges that the TruFUSE® surgery can be completed in less than an hour and the patient usually needs one night of hospital stay. Although the invention is patent-pending and cannot be currently asserted in a patent infringement lawsuit, Orthopedic Development currently owns a registered trademark with the USPTO for the TruFUSE® trademark.

us20060111782-fig3.jpgThe Plaintiffs discovered that one of their own distributors, Nutech Medical, Inc., was allegedly developing and marketing a “TruFUSE® knock-off” facet fusion product. The complaint alleges that Plaintiffs discovered that the infringing product was going to be marketed under a confusingly similar name of “NUFUZE” and that the product incorporates Plaintiffs’ proprietary information and trade secrets, which were provided under the Plaintiffs’ distribution agreement with NuTech. Upon learning of NuTech’s application to the USPTO to register the NUFUZE trademark, Plaintiffs filed an opposition to the application before the Trademark Trial And Appeal Board (“TTAB”). NuTech filed an answer in the TTAB proceeding and abandoned its NUFUZE and BIOFUZE trademarks, and allegedly began marketing the product under the “NuFix” trademark. The case is titled Orthopedic Development Corp. v. Vikingcraft Spine, SACV08-01888 (C.D. California)

The complaint alleges that numerous surgeons that use Plaintiffs’ TruFUSE® product began receiving solicitations from NuTech and its distributor, Vikingcraft, offering the NuFix product at a reduced price. Plaintiff filed suit against NuTech and other defendants in Florida and sent notice to Vikingcraft, putting it on notice of the patent application and the Plaintiffs’ unfair competition and false advertising claims. Plaintiff claims that Defendant falsely asserts “that (a) the TruFUSE® Allograft has a tendency to pop out after it is implanted and that the ridge design of NuFix reduces this occurrence; and that (b) NuFix is designed to be used with TruFUSE® Instruments held on consignment by hospitals.”

Plaintiff asserts that Defendant’s statements to customers causes confusion and asserts a cause of action under the Lanham Act unfair competition – false designation of origin (15 U.S.C. §1125(a)(1)(A)). Also, Plaintiff asserts a cause of action for false advertising under the Lanham Act (15 U.S.C. §1125(a)(1)(B)). Plaintiffs also include causes of action for common law unfair competition and for violation of California Business and Professions Code § 17200. In addition to preliminary and permanent injunctive relief, Plaintiffs seek monetary and punitive damages.

PRACTICE NOTE: Although a patent-pending application cannot be asserted in a patent infringement action, damages – in the form of a reasonable royalty – may be obtained against a potential infringer by putting the infringer on notice of a published patent application. See 35 U.S.C. 154(d).

Posted On: February 22, 2008

Hollywood Awards Gala Files Trademark Lawsuit Against Cybersquatter

Trademark litigation, including Anti-Cybersquatting Consumer Protection Act violations and Section 17200 unfair competition, was filed by Beverly Hills based Hollywood Network, Inc. against its former independent contractor of ten years, Chris Davies. Hollywood Network alleges that Davies was intimately involved in Plaintiff’s annual Hollywood Film Festival and Hollywood Awards gala celebration. Plaintiff is a licensee of numerous trademarks registered with the USPTO, including Hollywood Film Festival, Hollywood Awards, and Hollywood Movie Awards. Plaintiffs also own numerous domain names that incorporate their trademarks.

Plaintiffs allege that Defendant Davies registered the “awardshollywood.com” and “hollywoodmobileawards.com” domain name using a fictitious pseudonym or dba. Plaintiffs alleged that they made a good-faith attempt to resolve the dispute by having the domain names transferred voluntarily. However, Defendant offered to sell the disputed domain names to Plaintiffs. Plaintiffs thus filed the instant complaint alleging cybersquatting under 15 U.S.C. § 1125(d), requesting statutory damages under 15 U.S.C. § 1117(d) in an amount not less than $1,000.00 and not more than $100,000.00 per domain name. Also, Plaintiffs allege infringement of USPTO registered trademarks under 15 U.S.C. 1114(1) and False Designation of Origin under 15 U.S.C. § 1125(a). Further, Plaintiffs allege California Common Law Trademark Infringement and unfair competition under Business and Professions Code § 17200. The case is titled Hollywood Network, Inc. v. Chris Davies, CV08-01035 (CD CA 2008).

HFFBanner-StarzAwards.jpg

Posted On: February 21, 2008

Patent Infringement Lawsuit Filed Against DIRECTV By Phoenix Solutions, Inc. And Its Beverly Hills Patent Attorney

Patent infringement litigation commenced against The DIRECTV Group, Inc. in Los Angeles District Court on February 14, 2008. The patent holder, Phoenix Solutions, Inc., is accusing DIRECTV of infringing four of its patents (Patent Nos. 6,615,172, 7,139,714, 7,050,977, and 7,225,125). The patents relate to computer-based speech recognition technology and allow for “virtual customer service agent” responses to incoming phone calls from a live person.

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The complaint alleges that DIRECTV’s customer support lines and website, “including movie and/or event ordering lines and installer activation lines, that employ a natural language interactive voice response (IVR) system that includes a virtual agent” infringes on the four patents. The complaint asserts that customers/installers can speak with DIRECTV’s ordering system in a conversational manner, which ability has saved DIRECTV $9.2 million over touch-tone answering devices. The complaint states that Plaintiff contacted DIRECTV almost a year ago in an attempt to settle the dispute, but DIRECTV did not provide the requested information. Plaintiff alleges that the patent infringement is willful and seeks treble damages and attorneys’ fees and costs under 35 U.S.C. §§ 284 and 285.

Posted On: February 20, 2008

Copyright And Trade Dress Jewelry Design Infringement Filed Against Heidi Klum By Van Cleef & Arpels May Settle

A copyright infringement, trade dress infringement (Lanham Act 43(a), 15 U.S.C. 1125), and unfair competition lawsuit was filed by luxury jeweler Van Cleef & Arpels against supermodel Heidi Klum’s company and jewelry designer Mouawad USA, Inc. in Federal District Court in New York in December of 2007. The complaint alleges that for almost forty years, Van Cleef “has marketed the Alhambra collection of jewelry, which has become world renowned for its distinctive well-recognized design.” Van Cleef alleges that it is the owner of all copyrights in the subject designs and, through extensive advertising and promotion of the Alhambra collection, it has established secondary meaning and distinctiveness therein.

heidi-vancleef.bmpVan Cleef alleges that defendants intentionally and willfully copied the Alhambra designs, which mainly feature a four leaf clover. Van Cleef continues that defendants, by appropriating the goodwill built up by plaintiff are causing confusion in the market place, in that consumers are often confused between the plaintiff’s designs and those of defendants.

It now appears that the lawsuit is going to be settled even before the Defendants file an answer to Van Cleef’s allegations. On February 13, 2008, the parties asked the Court to adjourn the initial conference from February to April while they negotiate a settlement of the case.

PRACTICE NOTE: It is interesting that the case is settling so quickly because Van Cleef admits that one of its applications for copyright registration was refused registration by the U.S. Copyright Office. I would predict that it was refused registration because it was a mere depiction --without any elements of originality-- of a four leaf clover that appears in nature. Even if the copyright claim fails, however, Van Cleef appears to have acquired distinctiveness in its four leaf clover jewelry to assert its trade dress infringement and unfair competition claims, which exist outside of the copyright claims.

Posted On: February 19, 2008

Medical Device Patents - Invalidity And Non-Infringement Declaratory Relief Complaint Filed In Los Angeles By Sanofi-Aventis

Pharmaceutical company Sanofi-Aventis filed a complaint in Los Angeles, California District Court seeking a declaratory judgment that three medical device patents are invalid and not infringed by Sanofi’s syringes. The three United States patents at issue, which cover syringes having needle shield safety devices and may be used with pre-filled pharmaceutical injection syringes, are owned by Saftey Syringes, Inc.

Sanofi-pic-syringe.bmpSafety Syringes asserted the same three patents, Nos. 6,613,022, 7,101,355, and 7,300,420, in Los Angeles District Court in April of 2007 against Plastef. That case is titled: Safety Syringes, Inc. v. Plastef Investissements, 07-CV-2307 (C.D. CA 2007). Sanofi alleges that it imports and uses a needle safety shield device that is similar to the device in the Plastef case. Thus, because Safety Syringes has asserted claims of inducement and contributory patent infringement in the Plastef case, Sanofi-Aventis believes that it is being accused of infringing the three patents and that an actual controversy exists between the parties. Sanofi alleges that Safety Syringes has put Sanofi in a “position of pursuing behavior that [Safety Syringes] would allege constitutes an infringement or of abandoning a course of action which Aventis believes it has a lawful right to pursue.”


PRACTICE NOTE: Sending a cease and desist letter to a potential infringer may subject a patent holder to a declaratory judgment complaint in the potential infringer’s backyard. Careful wording in a cease-and-desist letter may divest the court of jurisdiction in the infringer’s home town and, thereby, eliminate defendant's "home court" advantage.

Posted On: February 18, 2008

Misspelled Trademark Does Not Save Cyber-Squatter or “Typo-squatter” From Adverse Arbitration Ruling

Domain-name arbitration complaint was filed by trademark owner Laerdal Medical Corporation at the WIPO. Laerdal had common law trademark rights in “Laerdal” before it filed a trademark application with the U.S. Patent & Trademark Office on October 16, 2000. The Disputed Domain Name leardal.com – a misspelling of the trademark which transposes the “a” and “e” – was registered by the Respondent on October 11, 2001, nearly one year after the trademark application filing date. Laerdal’s trademark registered with the USPTO on March 25, 2003, after the domain name was registered.

laerdallogo.gifThe Panel found that the medical company’s trademark and the misspelled domain name were confusingly similar. Also, the pay-per-click advertising on the parked website targeted the same consumers based upon offers for competing medical equipment and the registrant did not have any rights or interests in the confusingly similar trademark. Further, the Panel found that the domain was registered in bad faith because it was registered after the trademark application was filed and offered similar products through pay-per-click ads. Thus, the Panel ruled that the registration “was an act of typo squatting and was calculated to confuse Internet users as to the source of and to take commercial advantage of the Complainant’s rights in the LAERDAL trademark.” Click Here To Read The WIPO Arbitration Ruling.

PRACTICE NOTE: You should choose a strong trademark because it allows for instantaneous protection from the date of first use. For example, because laerdal’s trademark is strong, even though Laerdal’s trademark had not registered with the USPTO at the time the domain name was registered, the Panel found that the prior application date was sufficient to establish trademark rights. Fanciful, arbitrary, or suggestive trademarks are strong, whereas descriptive and generic marks are weak. Click Here For Additional Suggestions In Selecting A Trademark.

Posted On: February 16, 2008

Microsoft's Counterclaims In Symantec's Trade Secrets Lawsuit Dismissed

The trade secret and copyright infringement lawsuit filed by Symantec subsidiary Veritas against Microsoft is proceeding to trial in Washington, as we discussed here, when the Court denied Microsoft’s motion for summary judgment. Microsoft had also filed counterclaims in the Washington lawsuit against Symantec for breach of contract and for breach of the implied covenant of good faith and fair dealing. The agreement between the companies was for Symantec to provide source code in certain software to Microsoft for use with its operating software and servers; however, there were specific limitations on the use of the software which Symantec alleged Microsoft exceeded. The agreement also included the following jurisdictional provision:

VERITAS consents to jurisdiction and venue being solely in the state and federal courts sitting in the Western District of the State of Washington with respect to any claim or counterclaim brought by VERITAS in connection with this Agreement. MICROSOFT consents to jurisdiction and venue being solely in the state and federal courts sitting in the Northern District of the State of California with respect to any claim (including a counterclaim) brought by MICROSOFT in connection with this Agreement.

On summary judgment, the Court dismissed Microsoft’s contract-based counterclaims because of the unambiguous and express contractual language. The Court was not persuaded by Microsoft’s argument that enforcing the bargained-for forum selection clause would be unreasonable under the circumstances. Nor was the Court moved by Microsoft’s argument that Veritas had waived this defense by waiting to raise it on summary judgment because the defense was clearly stated in Veritas’ earlier filed Reply to Microsoft’s counterclaims. Click To Read The Order.

Posted On: February 15, 2008

Los Angeles, CA: Copyright Infringement Lawsuit Filed By Warner Brothers And Disney Against KaZaA User For Movie File Sharing

Copyright infringement litigation was filed against Miguel Naranjo by Warner Bros. Entertainment, Inc. and Disney Enterprises, Inc. on February 6, 2008 in the Central District of California, Los Angeles. The copyrighted movies at issue are Tim Burton’s Corpse Bride and Finding Nemo. The complaint alleges that since 2005, Mr. Naranjo, without plaintiffs’ permission, used the KaZaA online file sharing technology to distribute the movies in violation of the Copyright Act, 17 U.S.C. 101 et seq. The complaint alleges that the copyright infringement was willful and intentional and seeks preliminary and permanent injunctions, in addition to monetary damages and attorneys’ fees. Read The Warner Bros. Ent., Inc. v. Naranjo Complaint.