A recent Federal Circuit decision permitted claims of patent infringement and trademark infringement may be brought in two separate lawsuits, even though the claims were filed by the same plaintiff and accused the same product of infringement.
The Court’s decision arose from a dispute between portable conveyor manufacturers Superior Industries, LLC and Thor Global Enterprises, Ltd. Superior originally brought a trademark infringement action against Thor, asserting that Thor infringed Superior’s registered “FB” trademark by using the FB mark in Thor’s press releases and point-of-sale displays for a portable conveyor system. That lawsuit ended with a consent judgment that enjoined Thor from using the mark in connection with certain products.
Approximately 14 months after the consent judgment, Superior filed a second lawsuit in which it accused Thor’s portable conveyor system of infringing three U.S. patents. Thor moved to dismiss the case, arguing that the claims were precluded by the earlier-filed trademark suit. The district court agreed with Thor with respect to two of the patents, stating that “[t]he only reason the earlier suit did not contain patent allegations is because Superior Chose not to make them.” (The third patent had not yet granted at the time of the trademark suit.)
On appeal, the Federal Circuit reversed. In Superior Industries, LLC v. Thor Global Enterprises Ltd. (No. 2011-1549, Nov. 27, 2012), the Court explained that the patent and trademark suits involved different causes of action, each with a different set of facts. “Superior’s trademark claims arose from Thor’s use of the FB mark in advertising – not from actual sales or offers for sale of the [product].” In contrast, the patent infringement claims related to sales and offers to sale of the products themselves.
Accordingly, the Court found that the patent and trademark suits involved very different transactions. Notably, the Court did not address whether Superior could have brought its patent claim if the trademark suit had related to use of the mark on the products themselves. So, it’s not yet clear whether this case will have a broad impact, or whether its application will be limited to situations where the two lawsuits involve entirely different transactions.
Can a single color serve as a trademark in the fashion industry? According to a recent court decision, the answer is “yes” if certain conditions apply.
In Christian Louboutin S.A. v. Yves Saint Laurent America Holding, Inc., the U.S. Court of Appeals for the Second Circuit overturned a lower court’s holding that single colors cannot be protected in the fashion industry. The case revolved around Louboutin’s federal trademark registration for the color red in the form of a lacquered red sole on footwear. After Yves Saint-Laurent (YSL) launched a line of monochromatic shoes, Louboutin sued, asserting that YSL’s red shoe infringed Louboutin’s mark because the YSL shoe included a lacquered red sole. The lower court held that Louboutin’s trademark registration was inherently functional and thus likely invalid, and it denied Louboutin’s motion to enjoin YSL’s sales of the monochromatic shoe. Continue reading
Alcohol packaging and trademark/trade dress law have intersected quite a few times in the news this month. First, as Daniel Corbett recently reported, the maker’s of Daily’s cocktails sued Captain Morgan producer Diageo North America Inc. in a suit alleging that Diageo’s single-serve cocktail pouches infringed the plaintiff’s design patents and trade dress.
Then, the U.S. Court of Appeals for the Sixth Circuit ruled in favor of Maker’s Mark Distillery, Inc. in its complaint alleging that the makers of Jose Cuervo tequila infringed Maker’s Mark’s trademark and trade dress rights by featuring a bottle having a dripping red wax seal. In an opinion that provides not only a discussion of trade dress law but also an entertaining history of American bourbon manufacturing, the Court considered whether the dripping wax seal was entitled to trademark protection and concluded that the answer was ‘yes”.
In its defense, Cuervo argued that the seal could not be protected because it was “aesthetically functional.” The Court noted that “a trademark is functional ‘if it is essential to the use or purpose of the article or if it affects the cost or quality of the article.'” Although the Court did not affirmatively state whether or not it even recognized the doctrine of aesthetic functionality, it upheld Makers’ Mark’s rights because others could easily sell their products without using the dripping red wax seal:
The district court was not convinced “that it would be difficult or costly for competitors to design around” the mark and we do not disagree. There is more than one way to seal a bottle with wax to make it look appealing, and so Cuervo fails the comparable alternatives test. As to the effective competition test, the district court found that “red wax is not the only pleasing color of wax . . . nor does it put competitors at a significant non-reputation related disadvantage to be prevented from using red dripping wax.
Noting that the USPTO awarded Maker’s Mark a trademark registration for a non-color-specific version of the seal in connection with other food products, the court then turned to the question of infringement. Makers’ Mark argued that Cuervo’s use of the red dripping wax seal on tequila created “confusion of sponsorship” as to the source of the goods. Although there was no evidence of actual consumer confusion, the Court found that Makers’ Mark’s trade dress rights were strong due to over 50 years’ use of the dripping red wax seal. The Court also found similarity between the accused and original marks, as well as relatedness in the goods, although the Court gave these factors less weight than it gave to the strength of the mark. On this basis, the Court ruled in favor of Makers’ Mark.
The opinion provides some guidance for companies who offer products that may appear to be similar to competing products. First, although Markers’ Mark held a USPTO trademark registration for the dripping bottle seal, the registration was color-agnostic and only listed steak sauce (not alcohol) as the relevant goods. Thus, the opinion indicates the absence of a USPTO registration covering the goods in question does not necessarily mean that a party is not entitled to trademark or trade dress rights if the mark is sufficiently strong.
Second, the Court’s focus on strength of the mark shows that consistent use of a trademark over time, along with extensive marketing efforts, can provide a trademark owner with substantial leverage when others use similar marks. Franchisors, suppliers and others who own trademarks should adopt and enforce strict and consistent trademark usage policies before allowing others to use those marks. Otherwise, the trademark owner may end up with little or no trademark rights — and no ability to keep infringers out of the market.
[A version of this post originally appeared in Franchise Law Update, a blog hosted by Fox Rothschild’s Franchising, Licensing and Distribution Practice]
Last week a client contacted me and explained that many of its marketing materials refer to the company by its acronym rather than its full name. The client asked me about the pros and cons of registering the acronym as a trademark.
Almost on cue, after the call my email inbox received a message about a new article by my colleague Seth Kramer entitled “Use of Acronyms as Trademarks and Domain Names.” The article, published in the May 8, 2012 edition of the Legal Intelligencer, includes some important factors for companies to consider before registering an acronym as a trademark:
For starters, the company must actually use the acronym to distinguish its goods or services from those provided by others and indicate their source. Moreover, the acronym itself must have sufficient distinctiveness.
In addition, the article notes that “[i]n the context of acronyms, it is important to note that a trademark’s strength is determined not by the acronym itself, but by the term it signifies.”
The article is available on the Legal Intelligencer website, linked here. (Subscription may be required for the full article.)
Quite frequently, clients send me copies of official-looking documents that they have received relating to a non-U.S. patent, trademark or domain name. The documents typically describe an upcoming deadline and request that the client pay a fee in order to keep the patent, trademark or domain name in effect.
My advice to clients who receive these letters is generally this: “if you didn’t receive it from your attorney, it’s probably a scam.”
My colleague Christopher Kinkade recently published a useful article describing the USPTO’s official warning about such scams for trademarks, along with a companion article relating to domain name registration scams. To read Chris’ articles, click here (trademarks) or here (for domain names).
The U.S. District Court for the Southern District of New York recently issued an opinion and order in which it dismissed charges of trademark infringement and dilution involving the NAKED COWBOY trademark. In the suit, the New York City street performer known as the “Naked Cowboy” sued CBS after an episode of the soap opera The Bold and the Beautiful featured a character who “for several seconds, appeared only in his briefs, boots, and a cowboy hat, while singing and playing the guitar.” In the suit, the Naked Cowboy charged CBS with trademark infringement, trademark dilution, unfair competition, and various state law claims.
CBS moved to dismiss the claim, and the court granted CBS’ request. The court noted that the soap opera episode never used the phrase “naked cowboy”, that the character’s costume did not include any logos or phrases that the plaintiff uses, and that there was no actual or likelihood of confusion between the soap opera and the plaintiff’s goods and services. The plainitiff also tried to bring a claim for violation of his right to privacy, but the court noted that the right of privacy “does not extend to fictitious characters.”
The case is Naked Cowboy Enterprises v. CBS, Inc. (SDNY Feb. 23, 2012)
The USPTO recently issued its Performance and Accountability Report for FY 2011. So, it’s time for my annual update to the commonly asked question: “how long will it take for my patent or trademark application to grant?” Here are a few highlights from the USPTO report:
Patents: The average time between filing and first Office Action is 28.0 months, an increase of 2.3 months as compared to FY 2010 data. However, the average total pendency (i.e., time from the filing date to patent issuance or abandonment) of a patent application is 33.7 months, representing the first reduction in average total pendency since at least 2005. As Continue reading