Los Angeles Intellectual Property Trademark Attorney Blog

Sony Sued Over Karaoke Music Copyright Infringement Claims Of Almost $1.3 Billion

2012-01-10T01:46:57Z

KTS Karaoke is suing Sony/ATV Music Publishing for declaratory relief of copyright non-infringement and/or reduction of the damages amount at issue, which Sony claims is almost $1.3 billion. The music publishing company is co-owned by The Michael Jackson Family Trust (in 1985 Michael bought ATV publishing company that included the Beatles’ catalog for $47.5 million, causing a rift with Paul McCartney) and Sony and owns a vast library of music copyrights. KTS claims to be the largest distributor of karaoke hardware and software in the country.

Sony/ATV sent correspondence to KTS claiming at least 6715 acts of copyright infringement by virtue of selling karaoke discs that contained allegedly unlicensed recordings of music copyrights, resulting in statutory damages of at least $1,282,050,000.00. KTS argues that Sony/ATV has known of the manufacture and distribution of the karaoke CDs for more than the applicable three year statute of limitations and has not taken reasonable steps to stop the manufacture of the infringing products at the source. Instead, KTS alleges, Sony/ATV has engaged “in copyright misuse by seeking to secure multiple license fees from the same allegedly infringing work by suing each link of the distribution chain, by demanding license fees for licensed goods and by attempting to obtain more than one statutory damage award for the continuing infringement (i.e., downstream distributions of the infringing work) of a SINGLE WORK.”

If the court finds that KTS has infringed the copyrighted works, KTS asks the court to then determine the proper amount of damages in dispute: KTS alleges that “Sony/ATV claims that it is entitled to multiple awards of statutory damages for the same song appearing on different products while KTS believes that Sony/ATV is limited to one award per work, no matter how many different products are at issue as to a given work.” In addition, KTS contends that Sony/ATV is not entitled to any damages for many of the discs at issue because Sony/ATV has already recovered damages for the distribution of the subject discs from others in the distribution chain. KTS will presumably rely on the Ninth Circuit’s holding that “when statutory damages are assessed against one defendant or a group of defendants held to be jointly and severally liable, each work infringed may form the basis of only one award, regardless of the number of separate infringements of that work.” Columbia Pictures Television v. Krypton Broad. of Birmingham, Inc., 106 F.3d 284, 294 (9th Cir. 1997), rev’d on other grounds, Feltner v. Columbia Pictures Television, Inc., 523 U.S. 340 (1998)).

KTS also asserts a California unfair competition claim premised on the belief that Sony/ATV has allowed the Karaoke music CDs to be placed in the stream of commerce so that it could make various claims against sub-distributors and thereby recover multiple times for the same allegedly infringing conduct. KTS essentially claims that Sony/ATV encourages the infringement because it is part of its revenue generation model to extract “multiple recoveries from the same infringing discs and to line the pockets of Sony/ATV and its counsel.”

The case is KTS Karaoke, Inc. v. Sony/ATV Music Publishing LLC, CV12-0014 (C.D. Cal. JMM).

Twilight’s Bella Swan Wins Trademark and Copyright Infringement Lawsuit Over Jacket

2011-11-29T03:30:59Z

Before last week’s release of Twilight Saga: Breaking Dawn Part 1, a trademark and copyright infringement lawsuit saga dawned on clothing manufacturer B.B. Dakota over the pictured Bella Jacket. Summit Entertainment, the producer of the Twilight franchise that has raked in more than $1 billion in gross revenues, owns several USPTO trademark registrations for the “TWILIGHT” and “BELLA” trademarks, including for use on clothing and jewelry. Summit of course also owns all copyrights in the movies in addition to marketing and publicity materials and the “Bella Trading Card Image.” Summit’s licensing of the intellectual property rights has grossed an additional $63 million.

Defendant BB is a clothing manufacturer that sold the pictured women’s cargo jacket in 2006 under the “Leigh” mark, which was discontinued in 2008. When the Leigh jacket was worn by Bella in the 2009 Twilight movie, BB was credited as the manufacturer in an Entertainment Weekly article accompanying a photograph. BB’s outside public relations contractor then contacted Summit’s manager of national publicity requesting permission to re-publish the EW image on its website, which she included in an email link to EW’s website. Summit’s representative responded with a simple “OK.” A few days later, BB requested permission to allow for a retail store to use the image, to which Summit responded with one word: “sure”.

Without seeking further permission, however, BB created “hangtags” for the jackets that included not the Entertainment Weekly picture, but an image of Bella wearing the jacket that Summit had used to promote posters, clothing, and other merchandise. Apparently, BB’s own PR rep warned BB to obtain permission to use the new image, but BB failed to heed the warning and argued that by including “As seen in the Twilight movie” language on the tag would constitute fair use. Thus, BB’s sales representative emailed the image to two hundred of her sales accounts representing that BB had permission to use the image on the hangtag and to publicize the product. The retailers in turn sent out email blasts using the Bella image with the belief that BB had properly licensed it. Summit sent cease and desist letters to BB’s retailers, after which BB instructed them to cut the hang tags from existing inventory and provided a substitute picture of a girl resembling the Bella character. To make matters worse, BB continued to refer to the jacket as the “Twilight jacket.”

Metropark, one of BB’s retailers, filed bankruptcy and ModCloth settled the matter. BB countersued Summit for trade dress infringement and unfair competition. Summit filed for summary judgment of liability on its trademark and copyright infringement, and trademark dilution claims and on BB’s counterclaims.

]]> The parties did not dispute that Summit owned the Twilight trademarks. But BB claimed that its use of the trademarks constituted nominative fair use, which means that the accused party is using the trademark to refer to the other product or compare or describe its own product. A nominative fair use assertion shifts the burden to summit to negate the three elements: (1) defendant’s product or service cannot be readily identified without use of the trademark, (2) only use so much of the mark as is reasonably necessary to identify the product, and (3) defendant must do nothing that would suggest sponsorship or endorsement with the trademark owner. Toyota Motor Sales, U.S.A., Inc. v. Tabari, 610 F.3d 1171, 1182-1183 (9th Cir. 2010). Regarding the first element, the Court held that while it may have been necessary to make some reference to the movie or the person that wore the jacket, it could have been done without using the Bella image, the particular Twilight font, and certainly without renaming and marketing the jacket as “the Twilight Jacket.” As to the “reasonably necessary” prong, BB was found to have used more of the trademarks than necessary and “clearly sought to associate its product with the highly successful Twilight series to enhance its own profits.” Finally, the Court found that “the extensive use of Summit’s intellectual property at the very least implied sponsorship of the BB jacket.” Thus, the Court found that the undisputed facts established all necessary elements of Summit’s claims for trademark infringement, false designation of origin, and unfair competition.

The Court also found for Summit on its copyright infringement claim, rejecting BB’s fair use defense, license argument, and equitable estoppel defense because Summit waited several months after sending cease and desist letters before commencing suit. The Court, however, held that although all six likelihood of dilution factors weighed in Summit’s favor, a triable fact issue existed as to the “fame” of the Twilight trademark for purposes of a dilution claim and denied summary judgment on that issue.

On the other hand, the Court made short work of BB’s counterclaims for trade dress infringement and unfair competition claims: “Among the numerous reasons for which BB’s claim fails, the most intuitive is also clearest in the law. Common sense dictates that BB cannot sue Summit for appropriating or trading off that which Summit has created. This proposition is reflected in the case law holding that secondary meaning – a necessary element of a trade dress claim – must exist prior to the defendant’s use of the alleged trade dress.” This is especially true because BB had discontinued sales of the jacket before it appeared in the movie.

The case is Summit Entertainment, LLC, v. B.B. Dakota, Inc., CV10-4328 GAF (C.D. Cal. 2010).

Paris Hilton Sued For Copying Watch Design In Patent Infringement Lawsuit

2011-11-06T17:39:25Z

Since she blew onto the scene and gained notoriety from her 2004 sex tape, Paris Hilton has become a trademark licensing phenomenon, lending her name to a wide range of products, from shoes to perfumes. Her latest watch design, however, may not be as successful after being sued for patent infringement. Fine jewelry and watch designer de Grisogono has manufactured and sold the Novantatre watch since 2007. The term “Novantatre” is Italian for “93”, referring to the prominently displayed “9” and “3” on the watch’s face.

To protect the watch’s design, Plaintiff applied for and was granted U.S. Patent Nos. D596,052 (“the ‘052 patent”) and D627,673 (“the ‘673 patent”). The ‘052 patent covers the square-shaped casing design of the watch and the ‘673 patent relates to the ornamental design of the watch dial, including the positioning of the “9” and the “3”. Plaintiff is accusing the Paris Hilton-branded “Coussin” wristwatch of copying the same protected design elements covered by the two patents.

Plaintiff alleges that it sent multiple cease and desist letters to the defendants, which were ignored. Thus, Plaintiff contends that the infringement is willful and intentional and is requesting not only for disgorgement of Defendants’ profits under 35 U.S.C. § 289, but also for the court to triple the award under 35 U.S.C. § 284.

In addition to suing Paris Hilton Entertainment, Plaintiff is also suing the manufacturer Parlux as the exclusive licensee of the Paris Hilton trademark used on the watch, and Crossbow International and Mr. Pascal Savoy because they have possession and/or control of the Paris Hilton websites where the watches are sold.

The 9th Circuit’s recent Louis Vuitton v. Akanoc Solutions ruling affirmed a web host’s liability for failing to close down websites that were selling counterfeit goods. A jury trial resulted in a $32.4 million award, where the web hosts were jointly liable with the web site operators selling counterfeit goods that infringed Louis Vuitton’s trademarks and copyrights. The trial court then reduced the damages award by approximately $10 million. The 9th Circuit agreed that the web host was jointly liable, but further reduced the damages award because the verdict form improperly allowed multiple awards of statutory damages for willful copyright and trademark infringement against each infringer. “[W]hen statutory damages are assessed against one defendant or a group of defendants held to be jointly and severally liable, each work infringed may form the basis of only one award, regardless of the number of separate infringements of that work.” Columbia Pictures Television v. Krypton Broad. of Birmingham, Inc., 106 F.3d 284, 294 (9th Cir. 1997), rev’d on other grounds, Feltner v. Columbia Pictures Television, Inc., 523 U.S. 340 (1998)). Thus, the 9th Circuit vacated the damages award and ordered an award of approximately $10.8 million jointly and severally against all of the defendants.

The case is De Grisogono, S.A., v. Paris Hilton Entertainment, et al., CV11-9022 SVW (C.D. Cal. 2011).

Court Grants Software Copyright Temporary Restraining Order Against Former Employee

2011-11-03T06:30:00Z

Glacern Machine Tools, LLC is suing its former employee, who was also an owner and manager of the company, for copyright infringement, conversion, and breach of fiduciary duty. Glacern alleges that defendant Eric Sun wrote and created copyrighted source code, within the scope of his employment and on a work-for-hire basis, for a first property management software program and a second, derivative work that incorporates elements of the original source code. Sun allegedly used Glacern’s equipment at the direction of Glacern to create the software programs, which are owned by Glacern under the operating agreement.

Glacern contends that Sun removed two computers from its headquarters, copied the software programs, and changed the administrative passwords. In addition, Sun allegedly contacted Glacern’s customer and demanded that monthly payments now be paid to him instead. Thus, Glacern sought a temporary restraining order from the Court preventing Sun from: “(1) destroying Plaintiff’s Software Products; (2) withholding from Plaintiff personal property which Plaintiff owns, including the Software Products; and (3) transferring “any such asset, real or intangible.” In addition, Glacer sought to compel Sun to: “(1) within five (5) days, give Plaintiff a complete list of all locations of the Software Products; and (2) allow Plaintiff unlimited remote access to an IP address, which Plaintiffs believe houses the Software Products.”

The Court noted that in order to be granted equitable relief, Plaintiff must show irreparable injury and the inadequacy of legal remedies. Also, “[t]he proper legal standard for preliminary injunctive relief requires a party to demonstrate ‘that he is likely to succeed on the merits, that he is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his favor, and that an injunction is in the public interest.’”

The Court found that Plaintiff’s first alleged harm – loss of customers and business reputation – did not constitute irreparable harm because it could be redressed through monetary relief. But the second alleged harm – possible destruction of the software – did constitute irreparable harm warranting the issuance of the TRO. The Court, however, believed that the relief sought was too broad and only restrained the defendants from deleting or destroying the software programs until a hearing on the possible issuance of a preliminary injunction on November 7, 2011.

Prudent business owners require that employees execute work-for-hire agreements assigning copyrights, as well as other intellectual property rights, created in the scope of employment to the employer despite the Copyright Act’s ownership provision. In the absence of a written agreement, in Community for Creative Non-Violence v. Reid, the Supreme Court set forth several non-exhaustive factors to determine whether a hired party is deemed an employee. If an independent contractor creates the software program without a written assignment agreement, however, the independent contractor will own the copyrights therein. So if you want to own the copyright to your website, make sure you have an agreement transferring the rights to you before you pay the web designer.

The case is Glacern Machine Tools, LLC v. Eric Suyu Sun, SACV11-1641 DOC (C.D. Cal. 2011).

Power Rangers Halloween Costumes Morph Into Copyright And Trademark Infringement Suit

2011-10-28T00:10:49Z

Saban Entertainment originally created the “Power Rangers” live action children’s television series in 1993, where several teenagers would morph from ordinary people into powerful superhero characters wearing color-coded battle suits. The colors also served as each character’s name, e.g. the Pink or Blue Rangers. Plaintiff alleges that the “television series has been immensely popular with young audiences all around the world. To date, it has been broadcast over 19 seasons, spawned two theatrical films, and become a highly valuable merchandising franchise.”

To protect its intellectual property, Plaintiff has copyrighted the artwork and design of the Power Rangers uniforms (“Uniform Copyrights”) and also owns the copyrights in the television series where they are depicted. In addition, Plaintiff has copyrighted the characters in a style guide that is provides to authorized licensees. Further, Plaintiff is the owner of numerous USPTO trademark registrations incorporating the “Power Rangers” word mark and several USPTO registered trademarks for the Power Rangers character images.

Plaintiff accuses Underdog Endeavors, Inc. of advertising and selling Halloween costumes (one image shown here) on its www.mypartyshirt.com site that infringe Plaintiff’s “intellectual property rights relating to the popular ‘Power Rangers’ television series, brand, and related products.” In addition to the copyright and trademark infringement claims, Plaintiff brings causes of action for trademark dilution and unfair competition under Section 43(a) of the Lanham Act.

As a side note, Underdog’s placement of the allegedly infringing products on its website should constitute sufficiently widespread advertising activity to trigger coverage under its Commercial General Liability Insurance (“CGLI”) policy, which policy was hopefully in place before the alleged infringement began. Hyundai Motor Am. v. Nat'l Union Fire Ins. Co., 600 F.3d 1092 (9th Cir. 2010). Most CGLI policies have an advertising injury provision under which copyright, trade dress, and sometimes trademark infringement claims are covered and the insurance company has a duty to pay attorneys’ fees and costs to defend the insured against such claims.

Are Halloween costumes copyrightable because they are garments, you ask? Although a broad category of creative works are eligible for copyright protection, the Copyright Act, however, excludes any “useful article” (e.g. clothing) – defined as “an article having an intrinsic utilitarian function that is not merely to portray the appearance of the article or to convey information” – from copyright protection. Thus although garments as a whole are not eligible for copyright protection, the individual design elements – for example a floral graphic applied to the fabric – may be copyrightable. In Chosun, the Second Circuit held that Halloween costumes may be copyrightable if the design elements are separable from the overall function of the costume as clothing. Chosun Int’l, Inc. v. Chrisha Creations, Ltd., 413 F.3d 324 (2d Cir. 2005).

The case is SCG Power Rangers, LLC v. Underdog Endeavors, Inc., CV11-08485 JHN (C.D. Cal. 2011).

Village People Musical Group Wins TTAB Cancellation Summary Judgment Against Wife Of Former Member Willis

2011-10-11T02:34:00Z

The wife and manager of Victor Willis, a former member of the disco group the Village People (yes, you read “wife” correctly, the Village People had at least one straight “macho man”), filed three petitions for cancellation of Can’t Stop Productions, Inc.’s (“CSP”) three trademark registrations, two for the word mark VILLAGE PEOPLE and one for the design mark shown to the right. CSP filed motions for summary judgment on Willis’ pleaded grounds of fraud, abandonment and genericness in each of the three cancellation proceedings, which the Trademark Trial & Appeal Board (“TTAB”) consolidate in its order because of the sufficient commonality of the factual and legal issues.

CSP had the initial burden to show with sufficient evidence, if unopposed, that there is no genuine dispute of material fact on the fraud, abandonment and genericness cancellation claims. The burden would then shift to Willis to show that there are material facts in dispute to be resolved at trial. The TTAB summarized Willis’ abandonment claims:

Petitioner makes similar allegations regarding abandonment of all three of the registered marks, namely that since the 1980’s the marks have only been licensed for live performances and no new recordings have been made since 1985; that the mark is for a “concept group,” not a musical group; and that changes have been made to the design mark because of changes to certain of the characters depicted in the mark. Petitioner alleges that these changes amount to abandonment of all three marks without an intent to resume use.

Under the Trademark Act, a prima facie case of abandonment is made if a trademark has not been used, without intent to resume, in the U.S. for a period of three consecutive years. 15 U.S.C. § 1127. As the moving party to dismiss the claims of abandonment, CSP provided the declarations of its managing director and of its licensee with evidence of continuous use of its marks for all of the goods and services listed in the registrations. In response, Willis presented evidence that CSP has made no new recordings since the 1980’s, when the songwriter Willis left the band. Therefore, the TTAB found that there was at least a genuine dispute of material fact as to whether the mark is being used in “connection with pre-recorded phonograph records, audio cassettes and audio tapes featuring music and vocals.” Nope, CDs and MP3s don’t count. Thus, summary judgment was denied in Cancellation No. 92051212, but granted as to the other two on the abandonment issue.

Willis argued that the term “village people” is generic because it describes groups of people living in a community or small town. The Board held that the argument cannot apply to the design mark because the words “Village People” do not appear in the mark. As to the word marks, the Board granted summary judgment because Willis “has not, and apparently cannot, raise any genuine dispute of material fact with regard to this ground as [Willis] has submitted no evidence, nor even made allegations, to show that the term VILLAGE PEOPLE is used as a generic term for musical recordings or performances” as opposed to identifying people who live in a village.

The Board also dismissed Willis’ fraud claims, but allowed thirty days to amend the claim of non-use and/or fraud in Cancellation No. 92051212 only, which concerns the phonograph records and audio cassettes.

Karen L. Willis v. Can’t Stop Production, Inc., Cancellation No. 92051212 (September 22, 2011) [not precedential].

Baseball’s San Francisco Giants’ Lack Of Trademark Registration Results In Trademark Lawsuit

2011-10-03T14:39:07Z

The MLB champion San Francisco Giants not only failed to make the playoffs, but, to add insult to injury, their failure to register their stylized “San Francisco” logo is forcing them to defend a trademark lawsuit filed by a junior user, Gogo Sports. Gogo is an apparel manufacturer that sells customized and private labeled products according to its customer’s orders. Although Gogo is alleged to have adopted its San Francisco logo after the Giants, Gogo filed an application to register the trademark at the U.S. Patent & Trademark Office, whereas the Giants – surprisingly – did not, until only recently. On August 8, 2011, the Trademark Examining Attorney refused registration of the Giants’ later filed application for “clothing, namely, shirts and jackets; headwear” in light of Gogo’s previously registered – although on the Supplemental Register – trademark for “Caps; Hats; Headwear; Jackets; Shirts; Sweat shirts; Tops” because:

Here, the marks are virtually identical. Both share the same large wording SAN FRANCISCO in a stylized cursive font sloping upwards from left to right and with the same underline shape extending from the O under the wording. The only difference is the applicant did not include the geographically descriptive wording CALIFORNIA in small letters in the underline portion of the registrant’s mark.

Less than a month after the refusal, Major League Baseball Properties (“MLBP”) sent Gogo correspondence asserting superior rights in the design mark and demanding Gogo “immediately and expressly abandon the Supplemental Registration for the [mark], and immediately cease and desist from manufacturing, advertising, marketing, distribution, offering for sale and/or selling the Unlicensed Clothing and any other unlicensed product bearing any of the MLB Marks and/or any mark or graphic confusingly similar to and/or dilutive of any of the MLB Marks.”

After several correspondence between counsel, Gogo filed a declaratory judgment lawsuit seeking the Court’s ruling that it “has not infringed any trademark or protectable interest of the Giants and that the Giants have no valid trademark or other protectable interest in any products advertised, marketed, distributed or sold by Gogo Sports." But Gogo doesn’t stop there and inexplicably asks for a finding that “the Giants’ claim is barred and/or waived by the doctrine of laches, estoppel and/or acquiescence for their failure to seek USPTO registration for over 18 years.”

Although trademark rights are established upon use in commerce, this case exemplifies the advantages of early trademark registration that the Giants would have enjoyed, i.e. avoiding a nuisance lawsuit by a junior user. Also, even if a trademark registered on the Supplemental Register is not afforded the same rights as a mark on the Principal Register, one privilege – as here – is the USPTO’s refusal to register a later filed application based on a likelihood of confusion.

The case is Gogo Sports, Inc. v. Major League Baseball Properties, Inc. et al., CV11-7992 JHN (C.D. Cal. 2011).

Court Denies Fallout Video Game Temporary Restraining Order Against Masthead Studios

2011-09-22T20:15:01Z

Bethesda Softworks and Interplay Entertainment have waged a long-running, real world copyright and trademark battle over the virtual-world Fallout video game. The Bethesda v. Interplay Maryland lawsuit apparently arose over an ambiguity in the scope of a license back to Interplay in developing future Fallout video games. In 2007, Bethesda and Interplay entered into an asset purchase agreement that assigned all rights in the Fallout trademarks and copyrights to Bethesda. And, in a simultaneously executed trademark license agreement, Bethesda granted a license back to Interplay that provides:

Subject to the terms and conditions set forth in this Agreement, Bethesda grants to Interplay an exclusive, non-transferable license an right to use the Licensed Marks on and in connection with Interplay’s FALLOUT-branded [Massively Multiplayer Online Game] MMOG (the “FALLOUT MMOG” or “Licensed Product”) and for no other purpose. The conditional license herein does not grant Interplay any right to sublicense any of the licensed rights without Bethesda’s prior written approval.

In its initial filings, Bethesda claimed that Interplay failed to meet other contractual requirements, including securing required financing and complying with commercial launch deadlines. Later, Bethesda claimed that the trademark license applied only to the Fallout mark and not to any of the elements or characters in the game. Interplay countered that Bethesda’s interpretation cannot be harmonized with the rest of the agreement that provides for Interplay’s right to use “non-FALLOUT MMOG, inter alia, any or all locations, graphic representations, creatures, monsters, names, likenesses, [etc.]” should the agreement terminate prior to commercial launch. The Maryland court appears to have initially agreed with Interplay’s interpretation by denying, without much analysis, Bethesda’s motion for preliminary injunction.

Undeterred, and possibly seeking a change of scenery, Bethesda has filed a new copyright infringement lawsuit against Masthead Studios in Los Angeles. Bethesda alleges that Interplay has, in violation of the trademark license, entered into a product development agreement with Masthead for the development of a Fallout video game called Project V:13 by improperly sublicensing Bethesda’s intellectual property. This time, Bethesda wastes no time in alleging that under the Interplay trademark license, in “plain, clear and unambiguous” terms, Bethesda “granted Interplay a conditional license to use only the ‘FALLOUT’ trademark and nothing more relative to a Fallout-branded MMOG. Bethesda did not provide Interplay with any license to use any copyrighted materials relating to Fallout -- all copyrighted materials were retained exclusively by Bethesda.” Bethesda claims that Masthead’s performance of its duties under the Interplay agreement is both a direct and contributory infringement of its copyrights and filed for a temporary restraining order.

The Hon. John F. Walter, without even the benefit of an opposition from Masthead, denied Bethesda’s ex parte application for a temporary restraining order:

Plaintiff has not demonstrated that it will be irreparably prejudiced if the requested ex parte relief is not granted, or that it is without fault in creating the crisis that requires ex parte relief. Indeed, Plaintiff was aware as early as February 2011 that Masthead was potentially infringing its copyrights. . . . Bethesda Softworks LLC v. Interplay Entertainment Corp., Case No. 09 CV 2357, D. Maryland, Memorandum in Support of Plaintiff’s Motion for Preliminary Injunction at p. 7 (“According to Interplay, pursuant to this purported development agreement, Masthead Studios is assisting Interplay in developing its Fallout MMOG using the copyrighted Fallout works.”). Yet, Plaintiff waited seven months to apply for ex parte relief. The Court finds that Plaintiff unreasonably delayed in seeking relief, and that the emergency that allegedly justifies a TRO is self-created. Accordingly, Plaintiff’s Ex Parte Application for Temporary Restraining Order and Order to Show Cause Re: Preliminary Injunction is DENIED. If Plaintiff wishes to pursue its request for injunctive relief, it may do so by way of regularly noticed motion after complying with Local Rule 7-3.

Further, the Court denied Bethesda’s ex parte application for substituted service on Masthead, a Bulgarian software company.

The case is Bethesda Softworks, LLC v Masthead Studio, Ltd., CV11-7534 JFW (C.D. Cal. 2011).

Skechers Sues Steven Madden For Patent and Trade Dress Infringement Over Twinkle Toes Shoes

2011-09-14T06:46:47Z

Skechers is suing Steven Madden for allegedly copying Skechers’ Twinkle Toes shoe designs. The U.S. Patent & Trademark Office granted U.S. Patent No. D571,095 to Skechers covering its Twinkle Toes toe cap design for shoes. In addition to patent protection, Skechers claims that it is the owner of an inherently distinctive trade dress in its Twinkle Toes footwear designs. Skechers defines its trade dress as the combination of the following design elements: “a vulcanized canvass sneaker; a toe cap adorned with crystals, rhinestones, sequins or a plurality of other similar shiny elements; and, canvass uppers distinguished by colorful art designs or patterns.” For trade dress to be protectable, it must be non-functional. And Skechers asserts that the Twinkle Toes design is non-functional and simply conveys a distinctive appearance that is a source indicator.

Skechers further alleges that it has expended many millions of dollars promoting and advertising its trade dress and, based on extensive, frequent, and ongoing advertising, marketing, sales and distribution, the trade dress has acquired distinctiveness, which indicates that the shoes emanate from a single source. In other words, consumers recognize and associate the shoe design with Skechers.

Steve Madden’s “Stevies” brand shoes are accused of including “a vulcanized canvas sneaker, a toe cap adorned with crystal, rhinestones, sequins or a plurality of other similar shiny elements, and canvas uppers distinguished by colorful art designs or patterns” that infringe the subject patent. Further, Skechers contends that the Stevies footwear line so closely resembles the Twinkle toes trade dress that it is likely to cause confusion, mistake, and deception as to an affiliation, connection, or association of Steve Maddens’ footwear with Skechers. Skechers also contends that “Defendants have acted willfully, in bad faith and with the intent to confuse and mislead the public and unfairly trade on the substantial and valuable goodwill associated with Skechers' Twinkle Toes® Trade Dress and to capitalize on Skechers' highly respected reputation as a stylish, high quality footwear company.”

Design patents provide the owner with several competitive advantages. For example, design patents, during their fourteen year lifespan, can be used to legally prevent competing products from entering the market while the owner also establishes trade dress rights by attaining secondary meaning. Trade dress rights can then be used to perpetually protect the product configuration for as long as the trade dress is being used as a source identifier. Also, unlike utility patents, 35 USC § 289 allows a disgorgement of the defendants’ profits from any infringing sales. Design patents provide fashion designers protection for their clothing and shoe designs, which are considered useful articles that are not protectable by copyrights. Indeed, Steve Madden was recently sued by Jeffrey Campbell for design patent and trade dress infringement for allegedly copying the Lita shoe.

Additionally, a patented design may be infringed regardless of distinguishing trademarks or labels applied to the product that can defeat a trade dress claim. In L.A. Gear, Inc. v. Thom McAn Shoe Co., 988 F.2d 1117 (Fed. Cir. 1993), the Federal Circuit affirmed the finding of design patent infringement but reversed the trade dress infringement claim because defendants’ conspicuous labels and trademarks applied to the shoes made confusion among consumers unlikely. Although the Lanham Act also provides for disgorgement of the infringer’s profits, a double recovery is not allowed for infringement of the same design patent and trade dress. See, e.g., Contour Chair Lounge Co. v. True-Fit Chair, Inc., 648 F. Supp. 704, 719, 1 U.S.P.Q.2D (BNA) 1353, 1364 (E.D. Mo. 1986) ("Plaintiff is also entitled to lost profits for [trade dress infringement]; however, plaintiff has already recovered these damages under its patent claim.").

The case is Skechers U.S.A., Inc. v. Steven Madden, Ltd. et al., CV11-07295 PA (C.D. Cal. 2011).

Lukasian House Sues Former Employees For Copyright Infringement, Trade Secret Misappropriation, and Computer Fraud And Abuse Act Violation

2011-08-15T06:43:35Z

Lukasian House supplies major retail chains with hand-made storage and organization products made of wood and fibers. Lukasian alleges that for over ten years it has built a database of “mom and pop” factories in rural China that reliably provide well-designed, high-quality hand-woven products. Major retail chains choose to work with Lukasian because it has a dependable source of products for timely delivery. Lukasian, naturally, keeps the identity of its suppliers a closely guarded secret by limiting disclosure to certain employees, maintaining it on a secure computer network, and instructing employees of the confidential nature of the information. Lukasian has also filed several copyright registration applications for photographs of samples of storage baskets and a hamper that it never published.

Aprille Vergara and Chen “Jane” Chen were former employees that allegedly had access to Lukasian’s trade secrets in performing their duties. In May of 2010, Vergara and Chen and other defendants allegedly accessed Lukasian’s server to download trade secrets to use in establishing a competing business. Shortly thereafter, Vergara and Chen resigned and allegedly falsely stated that the former intended to go back to school and the latter was to work with in her husband’s real estate business. Relying on the provided reasons, Plaintiff allowed Defendants to continue working and they’re accused of acquiring “knowledge of Lukasian’s suppliers, its customers, its best-selling items, the prices at which it buys and sells those items, and its profit margins on those items.” Defendants are accused of selling competing products to Lukasian’s customers and undercutting its prices.

Lukasian brings causes of action for copyright infringement (17 U.S.C. § 501(a)), computer fraud and abuse act violation (18 U.S.C. § 1030(g)), California comprehensive computer data access and fraud act (Cal. Penal Code § 502(c)), trade secret misappropriation (Cal. Civ. Code § 3426), unfair competition (Cal. Bus. & Prof. Code § 17200), intentional interference with prospective economic advantage, and conversion.

The case is Lukasian House, LLC v. Ample International, Inc., CV11-6449 JFW (C.D. Cal. 2011).

Court: Disney/Pixar’s Cars Don’t Infringe Mandeville-Anthony’s Copyrights

2011-08-02T03:37:59Z

The race for Mandeville-Anthony was over before it even began. In March of this year, Plaintiff sued Disney and Pixar alleging that the Cars and Cars 2 animated motion pictures infringed his copyrights. Also, Plaintiff claimed that Disney and Pixar stole his idea for the motion pictures from his work that he submitted to Disney and Pixar employees.

Disney and Pixar quickly filed a motion for judgment on the pleadings under FRCP 12(c), which means after the complaint, answer, counterclaims and reply, if any, are filed, a defendant can seek early judgment that – based on the pleadings alone – a plaintiff cannot meet its burden of proof. In a short one page opinion, the Court dismissed the copyright infringement claim because the parties’ works are not substantially similar as a matter of law: “[a]mong other things, the protectable elements of the parties’ respective works are dissimilar in plot, sequence of events, pace, themes, dialogue, mood, setting, and characters.” As to the second cause of action for breach of implied contract (aka idea submission), the Court found that the claim was untimely because it was filed after the applicable two-year statute of limitations. Cal. Code Civ. Pro. 339(1).

Reviewing Defendants’ motion shed’s light on the flimsy nature of Plaintiff’s allegations: “How Plaintiff can contend these characters [pictured here] are similar is mystifying. . . In short, the parties’ expressions of the general idea of animated, anthropomorphic cars are extremely different. Any suggestion that the parties’ characters are similar – let alone, substantially similar – would defy the Ninth Circuit’s exhortation that copyright law protects only the specific details of an author’s rendering of an idea, and not the idea itself.”

The Court agreed with Defendants’ contention that the statute of limitations period begins to run on the date defendants first began to use plaintiff’s idea without compensation. Because Cars was released in June 2006, Plaintiff’s complaint was filed about three years too late.

The case is Jake Mandeville-Anthony v. The Walt Disney Company, CV11-02137 VBF (C.D. Cal. 2011).

Sonya Ooten Files Jewelry Patent & Copyright Infringement Lawsuit Against Soixante Neuf

2011-07-21T07:19:34Z

Jewelry designer Sonya Frisina does business as Sonya Ooten and has a retail store in Los Angeles. Ooten owns U.S. Design Patent No. D544,389, titled “Metal Crochet Earring,” covering the ornamental jewelry design. There is often overlap with different forms of intellectual property and Ootent, to maximize protection, also registered the “Cosmos” earring design with the U.S. Copyright Office.

Ooten alleges that Soixante Neuf’s “Oval Woven Beaded Earrings” infringe both its design patent and copyright. To prove design patent infringement, Ooten must meet both the ordinary observer test and points of novelty test. The design as a whole is examined in the ordinary observer test and the individual elements of the design are examined in the points of novelty test. To prove copyright infringement, unlike design patent infringement, Ooten must show that Soixante Neuf had access to Ooten’s design and copied it. Also, unlike utility patents, a successful design patent plaintiff can recover the infringer’s profits, plaintiff’s lost profits, or a combination of lost profits and reasonable royalty.

The case is Sonya Frisina v. Soixane Neuf, Inc. et al., CV11-5705 VBF (C.D. Cal. 2011).

Spearmint Rhino Sues Chiappa Firearms Because Guns Likely To Be Confused With Strippers

2011-07-14T23:17:03Z

Spearmint Rhino provides adult entertainment services, namely, it owns a large number of strip joints. In its sanitized complaint, however, “Rhino’s principal business is the development and licensing of its trademarks and the maintenance of control of the quality of goods and services offered in connection with Rhino’s marks.” As a side note, Rhino probably receives numerous applications for the position of quality control supervisor, but I digress.

Rhino owns several federally registered trademarks for its Rhino Outline logo, here, here, and here, that were filed on February 3, 2006. Thus, Rhino contends that its “registrations give it and its authorized licensees priority throughout the United States over any use in commerce of the Rhino Outline marks that had not commenced by February 3, 2006.”

Although the registrations cover goods and services in the adult entertainment industry, e.g. cabarets and “panties, g-strings, brassieres and corsets for semi-nude and erotic dancers,” Rhino sued Chiappa Firearms for allegedly using a confusingly similar Rhino design on its handguns: “Chiappa’s use of the Rhino Outline marks is likely to cause confusion, or to cause mistake, or to deceive because, among other reasons, consumers are likely to believe that there is an affiliation, connection, or association between” Rhino and Chiappa. Seriously? Maybe I’m a bit daft, but will consumers really confuse panties and guns?

Whatever Rhino’s belief, counsel should’ve advised that this is a very difficult case to prove because guns and strip clubs are unrelated . . . wait, except when Stephen Jackson's involved. If Rhino owned a copyright on the work, there would be more of a case. But where the goods or services are so unrelated, confusion among consumers is highly unlikely. Even the Trademark Examining Attorney did not believe that there would be a likelihood of confusion between the parties' marks because Chiappa's own rhino logo registered without a bump. Marco Randazza, in his own delicate way, always asks that clients show restraint before sending cease and desist letters or filing lawsuits with nebulous trademark claims.

The case is Spearmint Rhino Companies Worldwide, Inc. v. Chiappa Firearms, Ltd., et al., CV11-05682 R (C.D. Cal. 2011)

Tacori Loses Crescent Jewelry Design Preliminary Injunction Bid Against Scott Kay

2011-07-05T05:04:54Z

Tacori suffered another loss in its continuing copyright and trade dress infringement lawsuit against rival jewelry designer Scott Kay. The Court previously denied Tacori’s ex-parte application for a temporary restraining order, but that did not deter Tacori’s attempts to prevent Scott Kay’s sales of its Heaven’s Gate jewelry collection. Not surprisingly, the Court denied Tacori’s preliminary injunction bid, which was now focused solely on the copyright issue.

“A plaintiff seeking a preliminary injunction must establish that he is likely to succeed on the merits, that he is likely to suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his favor, and that an injunction is in the public interest.” Winter v. Natural Res. Def. Council, 129 S. Ct. 365, 374 (2008). Although a plaintiff must make a showing on each factor, the Ninth Circuit employs a sliding scale approach where “a stronger showing of one element may offset a weaker showing of another.” Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1131-35 (9th Cir. 2011). Thus, a preliminary injunction may still issue where there are “serious questions going to the merits and a balance of hardships that tips sharply towards the plaintiff . . . , so long as the plaintiff also shows that there is a likelihood of irreparable injury and that the injunction is in the public interest.” Id. at 1135 (internal quotation marks omitted).

The Court found that Tacori may be able to meet “its low burden of establishing copyright ownership” because the “requisite level of creativity is extremely low.” In order to show copying, Tacori had to establish Scott Kay’s access to its reverse crescent design and that the Heaven’s Gates rings were substantially similar. Scott Kay admitted that it was aware of Tacori’s design, but the Court found that the parties’ respective designs were not substantially similar.

In applying the extrinsic test, the court compared the two designs and found that neither the repeating reverse crescent design nor the diamond set in the triangular spaces between the openings is original. In addition, the Court found that Tacori “failed to provide competent expert testimony for this test” as its expert did not examine the parties' rings. For the intrinsic test, the Court found it unlikely that the ordinary audience for these very expensive rings “would find Defendant’s rings so similar in total concept and feel to Plaintiff’s rings that they infringe Plaintiff’s copyrights.” Further, the Court that Tacori failed to establish irreparable harm “absent injunctive relief, that the balance of the equities tips in its favor, or that an injunction would be in the public’s interest.”

The case is Tacori Enterprises v. Scott Kay, Inc., CV11-1565 DSV (C.D. Cal. 2011).

Enovsys Sues AT&T Mobility For Infringing Cell Phone Location Patents

2011-06-28T17:42:02Z

Enovsys filed a patent infringement lawsuit in Los Angeles against AT&T Mobility for infringing two patents: (1) US Patent No. 6,560,461, titled “Authorized Location Reporting Paging System” (“the ‘461 patent”), and (2) US Patent No. 7,925,273, titled “Method and Apparatus for Updating the Location of a Mobile Device Within a Wireless Communication Network” (“the ‘273 patent”). The ‘273 patent is a continuation of the application that resulted in the ‘461 patent, which means the ‘273 patent has the same invention disclosure as the ‘461 patent but with different claimed subject matter or scope.

The ‘461 patent’s invention uses satellites and ground control stations to determine a subscriber’s cell phone location and allows the subscriber to select which users can obtain the subscriber’s whereabouts. The patent also covers relaying the names and locations of nearby stores, restaurants, etc. based on the location of the cell phone. The ‘273 patent relates to a method of controlling the time intervals between updates to the cell phone’s location. The complaint accuses several AT&T applications of infringing the patents, including AT&T FamilyMap, AT&T Navigator, TeleNav Track, and Xora GPS TimeTrack.

Enovsys also alleges that Sprint-Nextel is currently licensing the subject patents in addition to others. The earlier Enovsys v. Nextel-Sprint lawsuit resulted in a jury award of $2.78 million in damages and eliminated the lack of standing defense. In the Nextel case, the Federal Circuit – aside from rejecting Nextel’s invalidity and non-infringement arguments – affirmed the jury’s verdict that the inventor’s ex-wife did not have a community property interest in the patents and did not need to be a named plaintiff.

The case is Enovsys LLC v. AT&T Mobility LLC et al., CV11-05210 DDP (C.D. Cal. 2011).