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For me, creativity has always been a way of standing out from the crowd, doing the unexpected, and adding passion to my work. My parents nurtured my creative side from an early age, gifting me Legos, subscribing me to Popular Science, and encouraging me to get involved in school activities with an artistic angle. I remember creating a hoverboard using a leaf blower in fifth grade, winning the science fair in sixth, and joining my small-town high school newspaper shortly thereafter. Soon, I began designing beautiful centerfolds, reporting on the latest tech topics, and writing poems and short stories. I also began to apply my creative skills to my schoolwork, adding unexpected pizzaz to my assignments.

In college, I continued to develop my creative skills. I taught myself how to code websites, crafted logos for non-profits, tried my hand at techie DIY projects (parabolic wi-fi dish, anyone?), and began painting abstract art. I also continued to apply my creative design and writing skills to the classroom and leadership positions in student government. Creativity helped me stand out in these venues and present my ideas in compelling ways. Furthermore, infusing imagination into everything I did made tasks fun and fulfilling. This strategy also worked well for me in law school, where I developed my love for all things intellectual property: patents, copyrights, trademarks, trade secrets, right to publicity, you name it. That passion continued to develop after law school as a clerk to a federal judge in the District of Minnesota.

Join me on this blog as I return to my journalist roots, discuss contemporary topics in intellectual property, and add creative commentary to the marketplace of ideas.

From time to time, I post squirrelly thoughts. Today, I wonder: Should a large company with famous, distinct trademarks sometimes hold back from aggressively enforcing those trademarks, even when doing so might at first appear to be a useful competitive strategy? I’m sure many executives at McDonald’s–the worldwide fast-food chain that it is so ubiquitous The Economist uses the prices of the Big Mac to measure purchasing power parity throughout the world–are questioning some past enforcement decisions.

If you haven’t heard, the European Union Intellectual Property Office (EUIPO) issued a decision cancelling McDonald’s “Big Mac” trademark registration within the European Union. Although the decision was based on certain procedural and evidentiary issues, it resulted from a proceeding brought by McDonald’s European competitor “Supermac’s,” an Irish fast-food burger chain opened in 1978, in response to McDonald’s aggressive enforcement tactics.

Supermac’s offers a similar cornucopia of comfort food items, including chicken nuggets, french fries, and the “Mighty Mac,” which is:

A succulent double burger complete with two 100% Irish beef patties, melted cheese, crispy lettuce, diced onion with ketchup and burger sauce served in a toasted sesame seed bun.

Sound familiar? Here’s how McDonald’s describes the Big Mac:

Mouthwatering perfection starts with two 100% pure beef patties and Big Mac sauce sandwiched between a sesame seed bun. It’s topped off with pickles, crisp lettuce, onions and American cheese for a 100% beef burger with a taste like no other. It contains no artificial flavors, preservatives or added colors from artificial sources. Our pickle contains an artificial preservative, so skip it if you like.

Perhaps for these reasons, McDonald’s vigorously opposed Supermac’s trademark registrations a few years ago, arguing that the similarity between the names “McDonald’s” and “Supermac’s” (the Mc/Mac usage) would cause confusion among consumers.

Which one is the Big Mac, and which is the Mighty Mac? (hint: in order)

In 2017, Supermac’s retaliated against McDonald’s enforcement activities, seeking cancellation of McDonald’s own flagship marks. Central to Supermac’s narrative is McDonald’s “trademark bullying”–a topic we’ve discussed generally on DuetsBlog numerous times. Specifically, Supermac’s argued that McDonald’s purposefully engaged in anticompetitive conduct, including “registering brand names . . . which are simply stored away in a war chest to use against future competitors.”

It is not readily apparent that EUIPO ruled against McDonald’s on grounds related to bullying or overly-aggressive enforcement because, ostensibly, the ruling is based on McDonald’s failure to prove genuine use of “Big Mac” as a burger or restaurant name–which seems hard to believe given, among other things, The Economist’s Big Mac Index. However, Supermac’s is calling this a victory for small businesses, and a win in “a David versus Goliath battle against trademark bullying by a powerful multinational.” As a result of EUIPO’s ruling, companies may now freely use “Big Mac” throughout the entire EU. McDonald’s has said it intends to appeal the ruling.

EUIPO’s ruling seems absurd, but it makes me wonder if McDonald’s could have avoided this ruling, and the trademark bully label, by taking a less aggressive stance in enforcing its trademarks. Instead of seeking to prevent registration of the Supermac’s and other marks in a transparently-competitive posture, McDonald’s could have decided to target its enforcement on certain products and names (e.g., Mighty Mac), or simply compete on the basis of quality and price. McDonald’s could have also considered creative ways to discourage Supermac’s from using similar marks, employing humorous methods akin to Bud Light sending a medieval jester to deliver a cease and desist message on a scroll to Modist Brewing. Increasingly, brands need to seek a balance between uncovering and prosecuting all possible misuses and not enforcing rights at all. This latest EUIPO may, at its heart, be a lesson in more selective enforcement.

Update: This article was referenced, and Kyle was quoted, by the Washington Post on February 11, 2019.

Who comes to mind when I list the following character traits: lives in a dystopian metropolis, has a deceased parent, fights criminals, rides a motorcycle, has seemingly-superhero strength, is fearless, has dark hair, and–oh, by the way–his name is “Wayne.” More than that, you learn all these facts about Wayne by watching a trailer for a series about Wayne on YouTube, which informs you throughout that Wayne is a character “from the guys who wrote Deadpool,” a fictional superhero. Take a look for yourself:

It should probably come as no surprise that many people watching the trailer–myself included–thought this Wayne might be “Bruce Wayne,” the well-known secret identity of Batman. The comments to the official trailer demonstrate as much. Consider, for example, the “top comment” for the trailer:

The Bruce Wayne most consumers know is the wealthy orphan owner of Wayne Enterprises by day, crime-fighting superhero by night. YouTube’s Wayne shares many of the same traits (except, perhaps, the wealth), and one could certainly believe that the Wayne series might be an origin story for one of the most popular superheros of all time. Of course, by the end of the trailer, you get the impression that the Wayne you’re watching probably isn’t (though there’s no disclaimer):

In total there are over 7,200 comments for the trailer at the time of writing this post. Since the official trailer, YouTube has released additional teaser trailers for the series, each making it clearer that Wayne probably isn’t Batman. Yet, viewers still aren’t quite sure:

What I find interesting about these comments is that they are a readily-available (though perhaps unreliable) data set for proving, or disproving, the existence of customer confusion. Assume that DC Comics, the owner of the Batman mark and Bruce Wayne character (which does not appear to have been registered, but to which DC Comics could have common law rights and copyright protection) could sue YouTube for infringement or dilution. Arguably, the comments on the Wayne trailers show that consumers are drawing a connection between DC Comics and the Wayne series given the name, mood of the series, and common character traits with Batman. In this, YouTube may be free riding on Batman’s popularity. Depending on just how many comments reference Batman, the comments themselves could serve as strong quantitative data of confusion–akin to the kind of survey data usually used to prove that element of a trademark claim.

On the other hand, many of the comments for the series do not reference Batman or Bruce Wayne. Do non-references indicate a lack of confusion, or perhaps a confusion that is dispelled quickly after watching the trailers? This relates to the doctrine of “initial interest confusion,” which is temporary confusion dispelled before a sale or some other commercial harm, but still may be actionable because the party creating the confusion free rides on another’s mark to gain attention. Since widespread access to the Internet, initial interest confusion cases have increased tenfold, but courts disagree about the vitality of the rule. Regardless, that confusion appears to persist in this situation–as demonstrated by the comments for each new trailer–shows that the confusion here may be of the continuing and uncured variety on which many trademark claims are based.

Wayne fully releases on YouTube in January 2019. There do not appear to be any lawsuits pending at the moment. And there does not appear to be a “Wayne” trademark registration for the series. But if YouTube (or the series’ creators) file for one, DC Comics could oppose the registration–and has done so for similar marks in the past. We’ll keep you updated with any new developments! In the meantime, let us know what you think in a comment below.

Readers of this blog may recall that in the past year, I wrote extensively about the U.S. Supreme Court case of Oil States v. Greene’s Energy. But I paid little attention to another important case decided around the same time: SAS Institute v. IancuOil States centered on whether the USPTO’s inter partes review (“IPR”) process (challenging a patent at the USPTO, rather than in court) was constitutional. SAS followed up with a seemingly less-pressing issue: whether, when the USPTO institutes an IPR to reconsider a patent by accepting an IPR petition, the USPTO must decide the patentability of all of the claims of the patent that the IPR petitioner challenged in the IPR petition. The Supreme Court ruled that IPR is constitutional in Oil States and that the USPTO must decide the patentability of all of the claims which were challenged in the accepted IPR petition in SAS.

Just this week, I was attending a “Supreme Court Preview” event hosted by the Eighth Circuit Bar Association. One of the topics was upcoming patent cases before the Supreme Court. I’ll admit; they’re not as juicy as last term (but perhaps only lawyers would have salivated over last year’s cases). However, one gave me a squirrelly thought: Return Mail v. United States Postal Service. The major issue in Return Mail is whether the federal government is a “person” who may petition to institute review proceedings before the USPTO.

Credit: Channel 3000

Technically, Return Mail doesn’t involve IPR, but rather a different proceeding called covered business method (“CMB”) review. CMB review, as its name implies, is limited to review of business method patents–that is, patents that claim a method or apparatus for performing data processing or similar operations relating to the practice, administration, or management of a financial product or service. But CMB review is very similar to IPR; a person files a petition with the USPTO seeking review, and the USPTO decides whether to institute proceedings. For example, in the Return Mail case itself, Return Mail, Inc. sued the United States Postal Service (“USPS”) for infringement of a business method patent described as: encoding information about the name and address of intended recipients in the form of a barcode, returning undeliverable mail to a processing location, scanning the barcode, obtaining the corrected information, and then providing that information to the sender to choose whether to resend with correct addressee information. (Description in the Federal Circuit opinion.)

Credit: Postal Reporter

Does Return Mail’s patent seem a little…obvious? Sounds like USPS might have a good shot at challenging the patent via CMB review, right? That’s what the USPS thought, so it petitioned for CMB review of certain claims of the patent. There’s just one problem: current patent law says that only a “person” can institute CMB review, and that person must meet certain other requirements, which include being sued or charged with infringement. Is the USPS–an arm of the government–a person? Current patent law does not define the term. In a short opinion, the Federal Circuit held that the federal government is a “person” for the purposes of CMB review. There was a fiery dissent. The Supreme Court granted cert on this specific question.

And here is where the squirrely thought arises. Just like CMB review, IPR review starts with a petition by a “person.” But unlike CMB review, an IPR petitioner need not have been sued or charged with infringement. Indeed, an IPR can be instituted by any person “who is not the owner of a patent.” 35 U.S.C. § 311. The USPTO must review all claims challenged in a petition if the USPTO accepts the petition. But the USPTO might not want to do that in every case–as in SAS. If the government is a person, can it escape SAS‘s mandate by filing its own petition for IPR limited to the claims it actually thinks should be evaluated?

The process would go something like this: (1) the USPTO receives an IPR petition from a third party and reviews the petition, (2) the USPTO determines it would like to institute review on some of the claims of the patent challenged in the petition, but perhaps not the same claims as those listed in the petition, (3) the USPTO works in collaboration with another governmental agency (say, for example, the Attorney General or USPS), (4) the other governmental agency files a petition for IPR of the same patent, but on the claims and grounds desired by the USPTO, and (5) the USPTO accepts the governmental petition, achieving the goal of escaping SAS‘s mandate that it decide the patentability of claims listed in the third party petition that the USPTO thinks need not be considered. And voila! Return the earlier petition for IPR as uninstituted to sender.

Thus, affirming the Federal Circuit could provide the government an escape from SAS, so to speak. While reversal could preclude agencies like the USPS from seeking cost-effective review of patents with the USPTO. What do you think?

Happy Halloween from DuetsBlog! I write today regarding a scary subject: unregistered intellectual property. The horror! Ask any IP professional about registration, and you’re likely to hear that registration is one of the most important steps in protecting IP. Whether it is a patent, trademark, or copyright, registering IP often provides the IP owner greater rights than if the IP was unregistered. There is sometimes an exception for trade secrets, but that’s for another time…

A scary place for some; credit: Gen. Progress

Registering IP, specifically copyrights, may become even more crucial in the future. One of the most important upcoming U.S. Supreme Court cases this term–which begins in October (coincidental?)–is Fourth Estate Public Benefit Corp. v. Wall-Street.com, LLC. The appeal addresses the question of whether the creator of an unregistered work may sue for copyright infringement so long as the creator has applied for a copyright on the work, rather than requiring the creator to wait for the Copyright Office to register the work. The dispute comes down to 17 U.S.C. § 411(a), which provides that:

no civil action for infringement of the copyright in any United States work shall be instituted until preregistration or registration of the copyright claim has been made in accordance with this title.

Currently, the Fifth and Ninth Circuit Courts of Appeal have held that creators may sue for infringement as soon as they file the appropriate paperwork and fees for registration. Importantly, the Ninth Circuit encompasses Hollywood, providing greater protection to many of the nation’s creators. I ran into this issue myself on a case in these venues, and thankfully the law in these jurisdictions supported bringing a claim for copyright infringement without awaiting registration.

The Tenth and Eleventh Circuits have held that filing for registration is insufficient; a creator must have obtained preregistration or actual registration to sue for infringement. It’s the stuff of nightmares for procrastinating creators in Wyoming, Utah, Colorado, Kansas, New Mexico, Oklahoma, Alabama, Georgia, and Florida!

But creators around the country, especially in Hollywood, let out a collective shriek when the federal Government filed a brief in support of the Tenth and Eleventh Circuits, arguing that “a copyright-infringement suit may not be filed until the Register of Copyrights has either approved or refused registration of the work.” Beyond the statutory arguments in support of this position, the Government argued that  “although…the registration requirement may temporarily prevent copyright owners from enforcing their rights, that is the intended result of a congressional design to encourage prompt registration for the public benefit.”

Maybe the Government is right; requiring registration will certainly encourage registration. But on the other hand, many small creators either do not have the time or resources to seek registration for every work. However, even in cases in which there is copying, a creator can file an expedited application for registration, which sometimes results in a decision in less than a week.  So perhaps the rule from the Tenth and Eleventh Circuits isn’t that scary after all. A non-expedited application can take months, though. Thus, the rule from the Fifth and Ninth Circuits provides greater protections to creators who may face copying immediately after creating a work and who do not have the ability to file an expedited application. We’ll see what’s in the Supreme Court’s candy bowl this term. To be continued…

It’s fall, and you know what that means: football season! For many, this means a return to the couch each weekend to spectate America’s most-watched sport. But the popularity of doing so appears to be in decline. This shift isn’t only affecting the NFL, but also college football as well, as ticket sales continue to plummet. Increasingly among my own family and friends, it seems as if everyone is more interested in playing their fantasy leagues than watching reality unfold before them. Which is why, one would think, that leagues and other football organizations would want to promote discussion about football, rather than hinder it.

Credit: Geek.com

But football organizations are cracking down on, rather than encouraging, use of familiar football names and phrases. Some have questioned, for example, the NFL’s bully-like tactics in aggressively protecting the “Superbowl” name. The annual “big game” is so well-known and such a major event that it’s almost impossible not to use its actual name. Yet, the NFL persists, enforcing more than just its famous name, drawing the ire of commentators each year.

Such tactics appear to have inspired a recent filing by the Heisman Trophy Trust against “HeismanWatch.com,” for trademark and copyright infringement. The Heisman Trophy Trust, the complaint says, is the owner of a slew of federal trademark and service mark registrations related to the Heisman Trophy, “one of the most distinguished, prestigious, and recognized awards in all of sports, and perhaps the most famous of all individual awards in football.” The award is given to the most outstanding collegiate football player, usually a quarterback or running back, each year. You might recognize the trophy by its distinctive “stiff-arm” maneuver captured in bronze:

Credit: The Ringer

Defendant HeismanWatch.com is a website that offers information, analysis, and podcasts about the Heisman trophy award. It is known for its “one-of-a-kind regression model that processes simulated Heisman votes,” to predict in advance who will win the Heisman each year. It reportedly correctly predicted the most recent winner, Baker Mayfield.

The Heisman Trophy Trust, apparently, does not appreciate HeismanWatch.com’s analysis and attention. It alleges that the website is deliberately attempting to free ride on the fame and notoriety of the Heisman Trophy marks, and it says that consumers are likely to believe there is a connection between the website and the actual trophy organization. Of course, the fact that HeismanWatch.com exists at all belies any such connection; the Trophy selection is secretive, but the website helps fans read the field and guess who will win next.

Time will tell whether the Heisman Trophy Trust can prevail against a news reporting and commentary organization like HeismanWatch.com, but it’s not unprecedented. The Academy Awards sued “OscarWatch.com” over a decade ago, prompting the website to change its name to “Awards Daily.” One cannot help but think that HeismanWatch.com has an incredibly strong nominative use defense, though. Under nominative use doctrine, another person can use the trademark of another if:

  1. the thing identified by the trademark (here, a trophy) cannot be readily identified any other way;
  2. the mark is used only as much as is necessary for that identification; and
  3. the use does not suggest sponsorship or endorsement.

The nominative use defense protects free speech and against the need to use “absurd turns of phrase” to avoid liability.

Credit: Wikipedia

It’s difficult to imagine a viable substitute to the name “Heisman,” given the trophy’s actual name–and namesake. What alternatives are there to HeismanWatch.com that do not include the surname? One commentator  offered an idea:

BestOffensivePlayerWithAGreatPRCampaignOnAVerySuccessfulTeamWatch.com.

Of course, this is absurd. And generic alternatives would fail to adequately describe what the website does (e.g., OutstandingCollegiateFootballPlayerWatch.com). One also doesn’t have to look much farther than a simple Google search to find that the media regularly uses “Heisman Watch” as a phrase to discuss anticipation about the next awardee. Even ESPN has a section called “Heisman Watch.” This kind of ubiquity shows the obvious necessity of using the surname. The common use of the phrase also suggests there is a very low likelihood that collegiate football fans are confusing the website–or any other reporting source–with the actual trophy organization. These are hallmarks of fair use.

But setting aside the legal defenses, one has to wonder if organizations such as the Heisman Trophy Trust, NCAA, and NFL ought to relax a little, and encourage the kind of use presented by sites like HeismanWatch.com. These fan centers generate excitement about, and interest in, football. That’s something football desperately needs more of lately.

Credit: Local Solutions

I write today regarding a squirrelly thought: are the benefits of registering a hashtag trademark almost always outweighed by the consequences? In light of a recent Trademark Trial and Appeal Board (“TTAB”) ruling and the Trademark Manual of Examining Procedure’s (“TMEP”) provisions, hashtag marks offer much less protection than traditional character-based marks, such that the latter are preferable in most situations.

We’ve all seen hashtag words and phrases (without spaces between the words) in social media, most commonly on Twitter–but also now on other sites, such as Facebook and Instagram. By affixing a hash symbol (#) to a word or phrase in a post, users can garner attention, join in a movement, and possibly “go viral.” Popular recent trending examples are #MeToo and #TakeAKnee. And of course, who could forget:

#selfie

Hashtags serve filtering, identifying, and promoting functions that have commercial advertising value. Thus, it is no surprise that hundreds of individuals and companies have applied for trademarks on “hashtag marks,” seeking to control the use of certain hash-preceded words and phrases. In fact, at the time of writing, there are over 1,900 such registrations. Hashtags are hip, and everyone wants one–or so they think.

In 2016, the USPTO added TMEP § 1202.18, which explains when “hashtag marks” may be registered:

A mark consisting of or containing the hash symbol (#) or the term HASHTAG is registrable as a trademark or service mark only if it functions as an identifier of the source of the applicant’s goods or services. . . . Generally, the hash symbol and the wording HASHTAG do not provide any source-indicating function because they merely facilitate categorization and searching within online social media . . . .Therefore, the addition of the term HASHTAG or the hash symbol (#) to an otherwise unregistrable mark typically will not render it registrable.

Recently, the TTAB applied this rule and other doctrines, holding that the addition of hashtags usually do nothing to make a mark distinctive. In the case, the TTAB rejected singer Will.I.Am’s application for a hashtag mark for #WILLPOWER because it was too similar to other registered marks containing”willpower,” and the hash symbol had no source-indicating distinctiveness, merely operating as a metadata tag for social media platforms.

The TTAB decision and TMEP provisions greatly narrow the registrability of hashtag marks, as well as their enforcement scope, such that it seems as if there is very little upside to applying for such a mark in most circumstances. An applicant does not need to register an otherwise-registrable mark as a hashtag mark in order to protect the mark if hashed. In such cases, a hashtag registration provides no more protection than a traditional character registration; the hash adds no additional layer of distinctiveness, just as it would not lend distinctiveness to an unregistrable word or phrase. Thus, an applicant should only apply for a hashtag mark in instances in which the non-hashed word or phrase lacks distinctiveness without the hash. If there is a case to be made for a traditional mark, the applicant should pursue that mark instead because traditional marks can be enforced more broadly.

If an applicant applies, however, only for a hashtag mark, then non-distinctiveness absent the hashtag will work to preclude the registrant from enforcing the mark in non-hashed situations. Even if the hashtag mark could be a mark on its own without the hash, the fact that the hashtag mark is either the first or only mark could result in a presumption against non-hashed distinctiveness–after all, why apply for a hashtag mark at all in such circumstances? It may also be more difficult to prove that non-hashed phrases, which in their non-hashed form are separated by spaces, infringe the hashtag mark. Imagine, for example, two competing phrases (the first example of which is a registered hashtag mark):

#lifeofabusyexecutive

Life of a Busy Executive

If the hash provides the distinctiveness for the first example (and perhaps in tandem with the lowercase and squished text), then presumably the second phrase without the hash (and with spaces) would not tread on that distinctiveness, working against a showing of consumer confusion and infringement. Of course, the holder of the hashtag mark could prevent identical use by competitors in commerce, but not similar non-hashed uses.

Emerging trademark law teaches that hashtag marks are extremely narrow–intentionally so–and as we’ve discussed before, hashtag marks are also greatly susceptible to fair use defenses. There appear to be few upsides to seeking such marks, at least without first trying for a traditional mark. So although trademark commentary as of late has focused on the trendiness of obtaining a hashtag mark, the more important question is whether it is worth doing so. In most cases, the answer will probably be “no.”

As Steve blogged earlier this week, we’ve had a lot of “zero” on the mind lately—marks related to the word and numeral. It got me thinking about the letter ‘O,’ especially since it has been in recent trademark news.

If you missed it, The Ohio State University and Oklahoma State University are now dueling it out at the USPTO over Oklahoma’s trademark application related to the block ‘O.’ Specifically, Oklahoma is attempting to register a mark of “a drum major marching while leaning back with head tilted back”:

According to Oklahoma, it has been using the singular block ‘O’ since 2001, most notably on the jersey of its band’s drum major (but also on sports memorabelia):

But in an opposition to the mark, Ohio says it has been using the same letter since as early as 1898, and it’s current main athletics logo includes the block ‘O’ in the background:

According to Ohio, Oklahoma’s use of the leaning and tilted ‘O’ is likely to cause confusion. I wonder if any other O-state institutions will weigh in—looking at you, Oregon.

On the one hand, the block styling of the Oklahoma ‘O’ could cause consumers to accidentally purchase sports gear from the wrong institution. On the other hand, the letter ‘O’ is such a fundamental unit of the English language that it’s hard to argue just one institution should be entitled to its exclusive use—even if it’s only in the college sports context. And Oklahoma is only seeking registration of a mark which uses ‘O’ in a minor fashion. However, Oklahoma’s marching ‘O’ mark could run into issues related to the requirement that the mark be used in commerce. After all, it’s a mark representing the band major, who wears an ‘O.’ How does Oklahoma otherwise use the mark or plan to use it commerce?

It turns out that the letter ‘O’ is not widely used as a mark on its own. There are some recognizable uses, though. Perhaps the most distinctive use of the letter ‘O’ is the Oprah Magazine:

In 2001, a German magazine also named ‘O’ sued Oprah’s ‘O’ magazine, but the suit appears to have gone nowhere, and Oprah’s ‘O’ lives on.

The only other major ‘O’ competitor appears to be Cirque du Soleil:

Maybe there’s some potential for confusion between the Oklahoma drum major and the high-flying circus performers. Though, I’m guessing the audiences for both don’t substantially overlap.

I think the few recognizable instances of ‘O’ marks can be explained by the overall minor distinctiveness a single letter can generate when used in connection with a brand. This is the up-hill battle both Ohio and Oklahoma will face in arguing their sides of the trademark dispute. Stronger letter marks are paired with other words, such as O Magazine and O Cirque du Soleil. Another example comes to mind: Toys ‘R Us (also in the news lately).

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.”

I’ve been thinking about the nature of language lately, ever since I listened to a podcast about various philosophers who devoted their study to language. For example, Ludwig Wittgenstein, one of the most influential philosophers of the twentieth century, is famous for his work on the logic of language. A fundamental premise to his philosophy is that “the limits of my language mean the limits of my world.” In other words, language, although purposed on painting a picture of reality, is fundamentally limited in its ability to describe and do so fully and accurately. For Wittgenstein, this primarily meant that language cannot help us answer pressing metaphysical questions, but the realization has practical importance in branding.

Consider Wittgenstein’s insight in tandem with the desire to promote recall and recognition in a name without causing customers to confuse the name with another source, and you are presented with the challenge underlying all word-based marks: to turn a generally-known and familiar word (or prefix or suffix or otherwise) into a distinctive identifier so that it means something different or more than its generic definition. No small task, especially given language’s inherent descriptive limitations, and this is evidenced by the finite universe of words and combinations to choose from. There is bound to be some overlap in naming. Hence, we regularly witness “trademark twins”–the same or similar words used as marks for different sources of goods and services.

One example of trademark twinning has garnered attention in the press recently, arising from a trademark infringement suit between the Billy Goat Tavern and the Billy Goat Chip Company. The Billy Goat Tavern is a fast-food restaurant in Chicago which gained notoriety when its founder brought his goat to a Cubs game, but was asked to leave (with his goat), casting the “Billy Goat’s Gruff” curse on the Chicago Cubs. Saturday Night Live also parodied the experience of eating there–accurately, I can attest.


Credit: Fox 32

The Billy Goat Chip Company, out of St. Louis, has no affiliation with the Tavern, but the Tavern took issue with the Chip Company’s similar name after the Chip Company’s crisps started showing up in Chicago. Recently, a federal judge rejected the Chip Company’s defense that the Tavern delayed too long in suing the Chip Company, after having notice of the similar name for several years. It is worth noting that although the companies’ names begin with the same two words, their logos set them apart:

But the similarity of the names in the context of food may be more likely to cause confusion than if the names were used in completely different industries. On a continuum of “identical” to “fraternal” (non-identical) twins, it’s hard to pinpoint where the marks fall–and, thus, whether trademark law would require a bit more distinguishing. There is a possibility that consumers would think of the chips, for example, as having some affiliation with the Billy Goat Tavern as a source. This is even more likely when one realizes that the Billy Goat Tavern has never sold fries, only chips with its signature “cheezborger.” Coincidence? I’ve written about stranger coincidences before. Even then, though, how many consumers are that knowledgeable about the Billy Goat Tavern to make the connection? I’m thinking these twins are fraternal.

Numerous other examples of trademark twins abound: Domino’s Pizza and Domino Sugar, Dove Soap and Dove Chocolate, Pom Wonderful and Wonderful Pistachios–just to name a few! Speaking of three, how about some trademark triplets: Apple (iPhone), Apple Records, and Apple Paints. Or quadruplets: Delta Airlines, Delta Dental, Delta Faucet, and Delta Power. These twins, triplets, and quadruplets all borrow similar common words as names, but use them in different industries–making it unlikely that consumers will confuse the companies as one source. Their use in dissimilar markets and in connection with unique logos mitigates the legal danger presented by the intersection of the limits of language, fleetingness of human memory, and protections afforded by trademark law. But industry and logo are just two ways in which their genes differ.

Can you think of additional trademark twins or otherwise? How are they fraternal or identical? What do you think is most important when balancing simplicity, familiarity, notoriety, and legality?