You may recall that DuetsBlog informed you in May of 2016 (here) that Beyoncé filed suit in New York federal court against a company and its owners who were using the mark Feyoncé on apparel and other products, such as mugs. She has now dismissed the lawsuit—likely based on a settlement (although the settlement has not been reported yet, and if there is a confidentiality provision in the agreement we may never know for sure).

Beyoncé was understandably troubled when the company began using both Feyoncé (rhyming with her name, the only difference being the beginning letter) and “Single Ladies,” which is the same name as Beyoncé’s famous Grammy award winning Song of the Year. In her complaint, Beyoncé explains that the song “tells the tale of female empowerment – the protagonist celebrates her newly found status as a single woman in a dance club telling her ex-boyfriend (who is jealous of the attention that she is receiving from other men) that if ‘you liked it, then you shoulda put a ring on it.” Beyoncé alleged that defendants were “seeking to capitalize on the notoriety of ‘Single Ladies’… defendants are selling merchandise bearing the ‘Feyoncé’ mark – a misspelling of ‘fiancé’ intended to call to mind ‘Beyoncé’ and her famous song.”

Beyoncé brought a motion for summary judgment. In denying the motion, the court found that there were genuine questions of fact regarding whether there was a likelihood of confusion. It was not enough that the company had tried to “capitalize off the exceedingly famous ‘Beyoncé’ mark.” There were still questions as to whether consumers would believe that Beyoncé was associated with the ‘Feyoncé’ products.

Beyoncé takes intellectual property rights seriously (as we all should). You may recall we blogged about her efforts to protect intellectual property related to her daughter Blue Ivy Carter, here, here and here.

We have likely not seen the last of Beyoncé’s efforts to protect intellectual property.

Congratulations to Stanford University’s Women’s Volleyball Team, winning the NCAA DI National Championship this past weekend in Minneapolis’ Target Center, defeating Nebraska in Set 5:

The competition was incredible, a real seesaw battle, Stanford winning Set 1 (28-26), Nebraska Set 2 (25-22), Stanford Set 3 (25-16), Nebraska Set 4 (25-15), setting up the Set 5 tiebreaker.

Even from our elevated vantage point, it was a challenge to ignore Stanford’s wild band, erratic cheerleaders, and bizarre dancing tree, during the many breaks in the action.

The Stanford Tree, not in the University’s official logo and seal, instead the spastic and gyrating Tree mascot, is simply “a member of the band” — as the University has no “official” mascot.

 

As the Sets progressed, an interesting pattern emerged, but not related to the random, spontaneous, and irrreverent motions and defiant gestures of the merry band of cheerleaders and Tree mascot. Any choreography appeared impossible to script.

No, the pattern I noticed was that each of the first 4 Sets was won by the team that had its back to the band, in other words, turned 180 degrees away from the Stanford Tree.

 

 

In contrast, the losers through Set 4, always faced the Tree, in defeat, coincidence, I think not.

The teams switched sides at the close of each Set. During Set 5, with its back to the Tree, Stanford was up 8-7 at the half, then switched sides again to face the Tree, but somehow was able prevail, in the end, while facing the Tree, winning the 5th and final Set: 15-12.

So, with all this turning away from the Tree mascot, positioning the team to win a National Championship on the one hand, and disavowing the Tree mascot on the other hand, specifically rejecting it as not the University’s mascot, I’m left wondering, who owns it?

In other words, clearly there is intellectual property wrapped up in the Tree mascot costume, I’m seeing both trademark and copyright at work here, but really, who owns it?

Put yet another way, who should Reese’s call for a co-branding opportunity to have the Tree mascot appear on packaging for these little gems, or perhaps, the gems themselves?

Can the University automatically own the intellectual property in an “unofficial” mascot? What are the legal distinctions, if any, between official and unofficial mascots?

For what it’s worth, disavowing the Tree, and its unofficial status, apparently hasn’t prevented the University’s payment of NCAA fines against Stanford when the Tree is especially unruly.

At Stanford, it appears that the student selected by the band to perform as the Tree for the academic year, wears the costume created by his or her predecessor from the previous year.

As to copyright, do you suppose there is a work for hire arrangement in place? So, who would you call to license the IP associated with the Tree? Here is a list of the apparent creators.

The battle for attorneys’ fees after an intense trademark dispute often leaves many prevailing parties empty handed. This is because the Lanham Act only provides for attorneys’ fees in “exceptional cases.” Congress’s (and courts’) reluctance to award attorneys’ fees stems from the “American Rule,” which provides that each party to a lawsuit is responsible for paying its own fees–unless a statute provides otherwise. But the Lanham Act erects a high bar to obtaining fees by requiring that the case be “exceptional.”

On the one hand, trademark owners should not have to fully shoulder the burden of what often turns into expensive litigation just to enforce their rights. Indeed, the estimated cost of protecting one’s rights can dramatically affect the calculus of whether to sue for infringement in the first place. But on the other hand, trademark violations are sometimes debatable and unclear. In such circumstances, the American Rule provides some protection to litigants who would otherwise be discouraged from seeking redress due to the risk that they might have to pay the defendant’s fees in the end if they lose. Thus, the Lanham Act strikes a balance, providing for reimbursement in cases of brazen and clear infringement–or brazen and clear abuse of the litigation process–while retaining the benefits the American Rule otherwise provides.

The Lanham Act’s fee provision has come up recently in two high-profile trademark cases: one involving Comic Con (reported on previously here and here), the other meme-famous Grumpy Cat (also reported on previously here). But the result was legally different in both cases, with Comic-con obtaining millions in fees under the Lanham Act, while Grumpy Cat obtained nothing under the Act, but recovered nevertheless pursuant to a contract between her and the infringer. What explains the different results?

Comic-con: The Comic Con (short for “comic book convention”) dispute began when the San Diego Comic Con sued the Salt Lake Comic Con for infringing on San Diego’s “Comic-Con” trademarks. The San Diego convention was one of the first comics-fan conventions.  And it is the largest convention of its kind, drawing more than 130,000 attendees each year. Salt Lake’s convention began in 2013, but it has quickly grown to over 120,000 attendees. Thus, it is probably no surprise that San Diego took exception to Salt Lake’s competing event and use of the same “Comic Con” name–though, as my colleague Jessica Alm pointed out, there are many other conventions across the United States using the same name.

San Diego Comic Con sued Salt Lake Comic Con for infringement. But despite the seemingly-debatable nature of the dispute (because the name could be generic, and it would be difficult to prove consume confusion), less than a year ago a jury determined that Salt Lake was liable for infringement in the amount of $20,000. Thereafter, San Diego moved for fees in the amount of $5 million–a little disproportionate, one would think (but perhaps not in view of San Diego’s requested $12 million in damages).

The district court judge granted $3.9 million. The reasons? Salt Lake repeatedly disregarded court rules, violated confidentiality rules, squandered judicial resources by relitigating issues, based arguments on irrelevant law, and attempted to bias the jury during the trial. The judge felt that the case stood out from others due to the “unreasonable manner it was litigated.” Expect an appeal on the $20,000:$3.9 million ratio.

Grumpy Cat: The Grumpy Cat dispute began when Grenade Beverage LLC, which had licensed Grumpy Cat’s trademarks (names and likenesses) to be used in trade dress and advertising for a new line of iced coffee products called “Grumppuccinos,” also used the marks in connection with a new coffee bean product without Grumpy Cat’s permission. Like the Comic Con litigation, the parties also litigated this case for three years. In addition, a jury awarded Grumpy Cat over $700,000–much more than San Diego Comic Con. But only $1 of that was for breach of the licensing agreement.

But unlike the Comic Con litigation, a federal judge recently denied Grumpy Cat’s request for approximately $320,000 in fees under the Lanham and Copyright Acts. The judge did, however, granted Grumpy Cat fees under the licensing agreement with Grenade Beverage–though, the judge said that there needs to be additional briefing on how much in fees can be awarded under the contract. Central to the judge’s decision on the Lanham Act fees issue was the fact that Grenade Beverage had not acted frivolously or in bad faith when they adopted an interpretation of the licensing agreement that entitled them to use Grumpy Cat’s marks in a line of Grumpy-Cat- branded “coffee products,” rather than just iced coffee. This reasonable difference of opinion–and, presumably, reasonable litigation behavior throughout the case–did not make out “exceptional” circumstances justifying fees under the Lanham Act.

In general, the Comic Con and Grumpy Cat cases provide two high-level teachings when it comes to fees. First, it is important to choose professional counsel, make reasonable litigation decisions, and take good faith positions throughout the course of a case. Otherwise, that conduct in and of itself may make the case “exceptional,” putting you on the hook. Second, attorneys’ fees provisions in a licensing agreement can serve as a helpful back-up if the Lanham Act fees request fails. But in providing for such fees, one should consider whether it is truly advantageous in the circumstances to remove the American Rule’s protections. That requires some thought…I need a Grumppuccino.

P.S. In April, I wrote about the USPTO’s attempt to obtain attorneys’ fees when it prevails in district court patent litigation. The Federal Circuit rejected this attempt, stating “the American Rule prohibits courts from shifting attorneys’ fees from one party to another absent a ‘specific and explicit’ directive from Congress. The phrase ‘[a]ll the expenses of the proceedings’ [in 35 U.S.C. § 145] falls short of this stringent standard.”

Another update on my long-running series of posts following the NHL’s newest hockey team, the Las Vegas Golden Knights, and their embattled trademark applications for VEGAS GOLDEN KNIGHTS that were filed nearly two years ago.

Most recently I posted about a challenge to the trademark applications by the U.S. Army, who opposed registration of the VEGAS GOLDEN KNIGHTS marks in connection with professional ice hockey exhibitions. The Army alleged likelihood of confusion, among other claims, based primarily on the Army’s prior use of a GOLDEN KNIGHTS mark in connection with the Army’s parachute demonstration team.

The hockey team announced last week that they had settled the dispute by executing a co-existence agreement, in which the Army agreed to withdraw the opposition proceeding and allow the hockey team to register the VEGAS GOLDEN KNIGHTS marks, while the hockey team agreed the Army would continue using the Golden Knights name for its parachute team.

This type of settlement involving a co-existence agreement is quite common in opposition proceedings. It is also not surprising for a couple other reasons. As discussed in my last post, the Army would have had a difficult time establishing the necessary “relatedness” factor for its likelihood-of-confusion claim. Although both parties technically are offering types of “entertainment” services, it would have been difficult to show that professional ice hockey exhibitions and parachute demonstrations are sufficiently related to cause likely confusion.

Furthermore, the financial support for the Army by Bill Foley (the owner of the hockey team) may have been a factor that encouraged an amicable settlement. Foley is a graduate of the U.S. Military Academy at West Point, and is the biggest donor to its athletic program. Due to his $15 million donation, Foley’s name is on West Point’s athletic center.

Now that the Army has withdrawn its opposition, the VEGAS GOLDEN KNIGHTS marks will likely register in the next couple months. This was a difficult road to registration in light of the various Office Actions and other challenges discussed in previous posts. But it was well worth the effort, in light of the high value of the team’s brand, especially due to the team’s quick competitive success and business growth. The Golden Knights made it to the Stanley Cup in their first season, and the team sold more merchandise last year than any other other NHL team.

Starbucks is moving away from green straws, actually any plastic straws, to live a little more green. So, we’re unlikely to see any straw trademark filings, despite decent look-for advertising.

While Starbucks appears to have drawn the short straw at the USPTO on its efforts to federally-register a pair of green dot marks, appeals to the TTAB are currently pending, here and here:

Let’s stay tuned to see whether Starbucks gets cooking at the USPTO by filing any service mark applications for its distinctive green colored aprons, can you say look-for advertising?

What do you think, does this GREENER APRON word-only mark filing move Starbucks closer?

Starbucks certainly seems to have a lot of brand equity wrapped up in the color green, so I’m left wondering why this coffee shop in San Francisco Int’l Airport chose its name and green letters?

Is it ironic that I’m writing and publishing this Starbucks post remotely on my lap top from here?

Starbucks, thanks for the great coffee, tasty blueberry muffin, and most importantly, the free wifi!

Aren’t digital advertising billboards amazing? My iPhone captured this rolling series of images just yesterday, for a health care organization using the Google trademark in the Minneapolis skyway:

My questions, permission, co-branding, no permission, but classic or nominative fair use?

Is Google flattered? Free advertising? Do they care? Should they care?

Discuss, to quote John Welch, on another subject.

Last week, I enjoyed the privilege of returning to Iowa City (where it all began) for Executive Leadership Board Meetings at the University of Iowa College of Pharmacy. Great meetings there!

During a stroll through downtown, I was reminded of Deadwood, a legendary Iowa City tavern, so I snapped a few photos, having long forgotten the creative tagline — Institute of Higher Learning:

Deadwood has special meaning in the trademark world. A federally-registered mark no longer in use and legally abandoned, is considered deadwood, making it ripe for and subject to cancellation.

We’ve written before — here and here — about the challenges of trademark deadwood that face brand owners, and we’ve also highlighted the USPTO’s proposed help on the way, here and here.

Yet, until there is perfect alignment between every federal registration and corresponding actual use, the problem of deadwood will remain, even if it is less frequently seen by brand owners.

What we haven’t discussed much before is how to guage whether a registration is deadwood. The most common approach is to have a routine, professional, factual investigation conducted.

Turns out though, even reputable, professional investigations that reasonably seem to point to non-use and abandonment are not perfect, nor are they a guarantee of all the relevant facts.

For example, years ago, we received a petition to cancel our client’s federal trademark registration on abandonment grounds. Petitioner’s counsel was overly-confident in the assertion of non-use.

The investigation even noted that the mark no longer appeared on our client’s product packaging and labeling. Sadly for the Petitioner though, the mark was still in use on point of sale materials.

As a result, the matter resolved very differently than expected for Petitioner. Our client ended up selling the registered mark and receiving a royalty free license back to continue using the mark.

Back to the Deadwood mark shown above, technically it is not deadwood at all, first, because it is not federally-registered, and second, it is very much in use, posing a very different kind of issue.

Undoubtedly there are unregistered rights in the Deadwood mark, and the owner could come out of the woodwork to oppose or cancel another’s registration even up to five years after issuance.

Given the uncertainty of when and if the owner of an earlier unregistered mark wakes up to the importance of federal registration, it is pretty risky to ignore these kinds of uses during clearance.

Finally, given the uncertain and imperfect nature of trademark investigations, it’s best to think ahead and have some alternative leverage in mind before chopping at wood assuming its dead.

Carvanaonline car dealer and operator of “a higher state of car buying” — sports a halo in its non-verbal logo shown above, but is it an angel when using the Google name and logo in t.v. ads?

In other words, is the use licensed by Google or could it be defended successfully without permission as trademark nominative fair use? Dear readers, what do you think?

In the meantime, a good friend Steve Feingold (who wears a halo well), will be delivering a Strafford webinar next month on Co-branding — maybe we can ask him to weigh in on this topic?

Mike Lindell, has built an impressive business around a pretty simple brand name and trademark:

We’ve previously written about the MyPillow trademark, noting the apparently narrow scope of rights it enjoys, as a result of the coexistence with some pretty similar marks, including this one:

Earlier this year, My Pillow filed a complaint in federal district court in Minnesota, against LMP Worldwide, owner of the above federally-registered and incontestable trademark registration.

The complaint alleges breach of a 2013 settlement, federal trademark infringement and unfair competition, Minnesota deceptive trade practices, Minnesota unfair competition, and asks for damages, lost profits, and cancellation of the above-referenced federal trademark registration.

The complaint is interesting reading, and it appears the notion of any peaceful coexistence is no longer an option if Mr. Lindell has his way, especially given the allegations regarding breach of contract, actual confusion, keyword violations, and false advertising.

Pillow talk about the settlement terms will be most interesting, as only cryptic passages are public.

Suffice it to say, when you’re spending $4 Million each week on advertising the MyPillow brand, as the complaint alleges, I’m thinking it’s hard not to believe LMP isn’t enjoying an enormous windfall.

— Jessica Gutierrez Alm, Attorney

In an age of rising healthcare costs, pharmaceutical companies can be an easy target in calls for patent reform.  Patent protection helps drug manufacturers recoup their investment in developing the new drug,.  It also prevents generic manufacturers from releasing the same drug formulation at lower cost.  The Hatch-Waxman Act provides a pathway for generic manufacturers to challenge branded drug patents, but this type of challenge requires costly litigation.

 

Inter Partes Review

Enter the Inter Partes Review.  An Inter Partes Review (IPR) is a procedure before the Patent Trial and Appeal Board (PTAB) for challenging the validity of a patent.  IPR proceedings provide an expedited and cost-effective alternative to litigation.  The IPR process was introduced in 2012, and since then, hundreds of patents have been invalidated using this process.  In the pharmaceutical industry, IPRs provide generic drug manufacturers with an additional or alternative path to challenge branded drug patents.

 

The Allergan Case

In 2016 and 2017, generic drug manufacturers filed IPR petitions seeking to invalidate patents owned by drug maker Allergan on its branded prescription eye drops, Restasis.  In response, and less than a week before a scheduled hearing before the PTAB, Allergan transferred its patents to the Saint Regis Mohawk Tribe.  Like states, Native American tribes have sovereign immunity, and therefore are not subject to private lawsuits.  The idea of sovereign immunity is codified in a Constitutional Amendment, and it stems from the basic notion that you cannot sue a monarch.

The Allergan-Tribe agreement provides for an initial payment of $13.25 million, plus an annual royalty of $15 million paid to the Tribe.  In exchange, the Tribe agreed to exclusively license the patent rights back to Allergan.

Shortly after the agreement was finalized, the Tribe moved to terminate the IPR proceedings on the basis of its sovereign immunity.

There are many opinions about both the legal and moral implications of this agreement, with some calling it a sham transaction.  In a highly unusual move, the PTAB authorized interested third parties to file amicus curiae briefs.  A total of 15 briefs from outside parties were filed, including some from other Native American Tribes.  Seven briefs were filed in support of the Tribe’s (and Allergan’s) sovereign immunity argument, while eight argued against it.  Briefs siding with the Tribe cited prior PTAB decisions recognizing sovereign immunity for states, and dismissing IPR proceedings initiated against state universities.  Briefs arguing against the Tribe’s motion cited a lack of precedent with respect to tribal-specific sovereign immunity, and asserted the question should be left for Congress.

 

The PTAB’s Sovereign Immunity Decision

Ultimately, the PTAB decided last month to deny the Tribe’s motion to terminate the proceedings.  See the decision here, courtesy of Patent Progress.  The PTAB differentiated tribal sovereign immunity from state sovereign immunity, and broadly held that tribal sovereign immunity does not insulate a patent from an IPR proceeding.  The Tribe and Allergan are seeking to appeal the decision.

What do you think?  Just as a matter of policy, should companies be permitted to transfer their IP to sovereign entities to avoid this type of challenge?  The PTAB’s distinction between tribal and state sovereign immunity suggests that if Allergan had made this same agreement with a state university instead of a tribe, the IPR would have been terminated.  Is that the right distinction to make?