Las Vegas Trademark Attorney

Marc Lurie/AirFX.com Wins Reverse Domain Name Hijacking Claim Against AirFX, LLC on Summary Judgment

noreply@blogger.com (Ryan Gile) — Tue, 28 Aug 2012 01:10:00 +0000

AirFX,LLC (“Defendant”), the owner of the trademark AirFX, suffered a defeat last week in its attempt to “acquire” (or as some might say “hijack”) the domain name www.airfx.com from its current registrant, Marc Lurie (“Lurie” or “Plaintiff” ). [Note: There were many articles about this dispute last year when the court denied Defendant’s Motion to Dismiss – see here, here, here, and here for a small sampling].

The airfx.com domain name was originally registered by Bestinfo on March 21, 2003. In June 2005, Air Systems Engineering, Inc. ("ASE") filed a trademark registration application for the mark AirFX for “motorcycles, vehicle parts, namely, shock absorbers, and suspension systems for motorcycles, bicycles, automobiles, and powered vehicles.” The mark registered in March 2007. In April 2011, ASE assigned its trademark rights to a wholly owned subsidiary, Defendant AirFX,LLC.

Lurie originally was involved in operating skydiving wind tunnel businesses under the name "SkyVenture," but later decided to use the name AIRFX in connection with a new line of wind tunnels (despite having found ASE’s application to register AIRFX after conducting a trademark search). Lurie acquired the airfx.com from Bestinfo for $2,100 on February 2, 2007, but never posted any content or created a website – and instead has a typical landing page (or “splash page” as defined in the opinion) put up by the registrar, GoDaddy.com. While the landing page does have links to third party advertisements, Lurie maintained that he drived no revenue from such advertisements (and Defendant never provided any evidence to the contrary). After leaving SkyVenture, Lurie was bound by a non-compete agreement prohibiting him from developing his own line of wind tunnels until 2010. However, Lurie never sold any product under the brand AIRFX nor conducted any advertising, marketing, or manufacturing activities. Lurie also never sold or offered to sell suspension systems for motorcycles, or any other motorcycle-related products.

Defendant contacted Lurie in 2008 regarding the purchase of airfx.com. While the partie dispute the terms of the offer at that time, no agreement was reached. In 2011, Defendant filed a domain dispute complaint before the National Arbitration Forum. On May 16, 2011, the arbitration panel ruled in favor of Defendant and ordered that GoDaddy transfer airfx.com to Defendant. See AirFX, LLC v. ATTN AIRFX.COM, Claim Number FA1104001384655 (NAF May 16, 2011)).

Lurie sought relief against the ordered transfer by filing a complaint which included a claim for reverse domain name hijacking under 15 U.S.C. § 1114(2)(D)(v). Defendant counterclaimed with claims of cybersquatting and trademark infringement. The parties filed cross motions for summary judgment. On August 23, 2012, the U.S. District Court for the District of Arizona ruled in favor of Lurie by finding as a matter of law that Lurie was not liable for Defendant’s counterclaims of cybersquatting or trademark infringement, and accordingly, Lurie’s Motion for Summary Judgment on its reverse domain name hijacking claim was granted. See AIRFX.com et al. v. AirFX LLC, 2012 U.S. Dist. LEXIS 120285 (D. Ariz. August 23, 2012) (order here).

In deciding Defendant’s cybersquatting claim, the issue centered around the meaning of “registration” (ed.-an issue near and dear to my heart). The court detailed the Ninth Circuit’s recent decision in GoPets Ltd. v. Hise, 657 F.3d 1024, 1030 (9th Cir. 2011) which clarified the meaning of "registration" and found that a party’s re-registration and continued ownership of a domain name that a party had registered long before a trademark owner registered its trademarks does not violate the cybersquatting statute (prior blog post here).

Defendant attempted to distinguish GoPets because in that case, the original domain name registrant transferred the domain name to an entity that he co-owned. In contrast, Lurie purchased airfx.com from an unrelated third party. Defendant argued that the purpose of the ACPA would be undermined if a cybersquatter who purchases a domain name in bad faith is immune from liability simply because the domain name he purchased existed before a mark was distinctive.

However, the court found otherwise:

Nothing in the language of GoPets indicates that it should be read as narrowly as defendant suggests. GoPets did not distinguish between transfers of a domain name to related parties and other kinds of domain name transfers. To the contrary, GoPets broadly reasoned that if an original owner's rights associated with a domain name were lost upon transfer to "another owner," the rights to many domain names would become "effectively inalienable," a result the intention of which was not reflected in either the structure or the text of the ACPA.

In short, the court, following GoPets, found that it was undisputed that airfx.com was initially registered on March 21, 2003 by Bestinfo, ASE’s first use in commerce of the AirFX mark was June 2005, and Lurie purchased airfx.com on February 2, 2007 – and thus, Lurie’s registration of airfx.com in February 2007 "was not a registration within the meaning of § 1125(d)(1)” and because Bestinfo registered airfx.com long before ASE registered its mark, Lurie’s registration and ownership of airfx.com does not violate the cybersquatting statute. The court granted summary judgment on Defendant’s cybersquatting counterclaim in favor of Lurie.

As for Defendant’s counterclaim for trademark infringement, the court focused on the fundamental issue of whether Lurie used the mark “in commerce” (noting that “If a person's use of a mark is noncommercial, it does not violate the Lanham Act.”). Defendant’s sole argument of Lurie’s commercial use centered on particular allegations and admissions. However, the court found no dispute that Lurie had never sold an AirFX product, have no advertising or marketing activities, have no manufacturing activities, never developed a website for airfx.com, and never sold any AirFX products or services on such website. The court further found that Lurie’s limited activity of some pre-sales efforts and preliminary research, viewing such facts in the light most favorable to Defendant, was still insufficient to constitute commercial use of a mark.

Although plaintiffs have developed a brand name, registered a domain name, started researching the design of their wind tunnels and approached potential investors and customers, plaintiffs have not sold, manufactured, advertised, or marketed any product bearing the AirFX mark. Defendant points to no other facts to establish plaintiffs' commercial use of the AirFX mark.

As such, without raising any genuine issue of material fact as to whether plaintiffs' use of the mark was commercial, the court found as a matter of law that no commercial use existed and therefore, there could be no trademark infringement as a matter of law and granted summary judgment on Defendant’s trademark infringement counterclaim in favor of Lurie.

Finally, with respect to Lurie’s claim for reverse domain name hijacking, the only issue was whether Lurie’s registration of the airfx.com domain name was “not unlawful."

Because we have concluded that plaintiffs cannot be liable under the ACPA for cybersquatting as a matter of law, and because plaintiffs are entitled to summary judgment on the trademark infringement claim, we conclude that there is no genuine issue of fact as to whether plaintiffs' use of the domain name is lawful.

Defendant tried to argue that Lurie should not be entitled to such equitable relief because Lurie “conducted the litigation in unprecedented, and unprofessional ways.” [ed.—there are two sides to every story, and I’m sure Lurie has some stories about the actions of Defendant’s counsel as well]. However, the court noted the clear mandate of 15 U.S.C. § 1114(2)(D)(v), which allows the court to “grant injunctive relief to the domain name registrant, including the reactivation of the domain name or transfer of the domain name to the domain name registrant." As such, the court ordered that the airfx.com remain registered with Lurie.

The court’s final words was to note that “[b]oth parties argue that this case is ‘exceptional’ under the Lanham Act, warranting an award of attorneys' fees. We will address a motion for attorneys' fees if and when one is before us.” Stay tuned . . .

Stephens Media Wins $200,000 Default Judgment Over Alleged Trademark Infringement of “Best of Las Vegas”

noreply@blogger.com (Ryan Gile) — Wed, 08 Aug 2012 16:47:00 +0000

[After all these years, they still have do not have a category for “Best Las Vegas Trademark Attorney Blog” – or perhaps my dearth of blog posting in 2012 took me out of the running this year]

Back in 2009 (when I had much more time to blog on a more regular basis), I wrote about the three separate trademark infringement lawsuits filed by Stephens Media LLC (“Stephens Media”), the owner of the Las Vegas newspaper The Las Vegas Review Journal, against three separate companies over their alleged use of the term “BEST OF LAS VEGAS.” See previous blog entry here.

In the case against one of the companies, CitiHealth LLC (“CitiHealth”), on August 6, 2012, U.S. District Court Judge Miranda Du issued a decision on a motion for default judgment filed by Stephens Media. See Stephens Media LLC v. CitiHealth LLC, 2012 U.S. Dist. LEXIS 109431 (D. Nev. August 6, 2012). What is interesting is how long it took for the case to get to this point.

The complaint against CitiHealth was originally filed on December 2, 2009, and related to the company’s publication of a magazine in December 2008 called “Healthy Living Las Vegas” that included the phrase on the cover “Best of Las Vegas.” When CitiHealth failed to answer the complaint, a default was entered by the Clerk on March 24, 2010. So why didn’t Stephens Media seek a default judgment at that time? Well, the complaint was originally filed by Steve Gibson and his former firm Gibson Lowry and Burris. Steve Gibson is also better known as the CEO of Righthaven LLC, the copyright enforcement company established by Gibson and Stephens Media to file lawsuits against websites that infringed on copyrights associated with Las Vegas Review Journal articles. [I certainly don’t have the time or energy to go into all of the details of the Righthaven-saga in this post and will instead defer to those websites (here and here) that have tracked all things Righthaven and which will give any interested party the necessary background to understand what may have caused Mr. Gibson to be a little distracted during 2010 and 2011 as well as what may have caused a rift between Mr. Gibson and Stephens Media].

Over a year went by without any follow-up after the entry of default against CitiHealth. Finally, on May 24, 2012, the Court issued a Order to Show Cause, as to why the case should not be dismissed for failure to prosecute. Six days later, Stephens Media filed a Motion to Substitute Attorney and subsequently informed the Court that that it had retained new counsel and intended to seek a preliminary injunction and default judgment. On July 2, 2012, through new counsel Gordon Silver, Stephens Media filed the Motion for Default Judgment. On July 13, 2012, Kenneth Shepherd, the co-owner of CitiHealth, notified both the Court and Stephens Media’s counsel that Healthy Living no longer exists and has not existed for the past 3 years and that CitiHealth had dissolved on May 9, 2012 and that the co-owners of the company had had filed for personal bankruptcy.

The Court nevertheless proceeded to analyze Stephens Media’s motion for default judgment under the Eitel factors established by the Ninth Circuit:

"The Ninth Circuit has identified the following factors as relevant to the exercise of the court's discretion in determining whether to grant default judgment: (1) the possibility of prejudice to the plaintiff; (2) the merits of the plaintiff's substantive claims; (3) the sufficiency of the complaint; (4) the sum of money at stake in the action; (5) the possibility of a dispute concerning material facts; (6) whether the default was due to the excusable neglect; and (7) the strong policy underlying the Federal Rules of Civil Procedure favoring decisions on the merits. Eitel v. McCool, 782 F.2d 1470, 1471--72 (9th Cir. 1986); see also Trustees of Elec. Workers Health and Welfare Trust v. Campbell, No. 07-724, 2009 WL 3255169 (D. Nev. Oct. 7, 2009)."

Despite CitiHealth's dissolution, the Court found that CitiHealth's failure to appear in this action and the likelihood that it will never respond to this action creates a high possibility of prejudice to Plaintiff in the absence of a default judgment. The Court found that the Complaint did sufficiently state claims for relief (under the Rule 8 liberal pleading standards).

With respect to the amount of money at stake, Stephens Media sought $200,000 pursuant to 15 U.S.C. § 1117(c)(1) for non-willful trademark infringement of one mark (i.e., the Trademark Act’s statutory damages provision for use of “counterfeit” marks). Without much discussion, the Court stated that “[b]ecause Stephens demonstrates a basis for its requested monetary relief, the fourth Eitel factor favors Stephens.” [Comment: counterfeit use, really? And even so, court has discretion to award statutory damages ranging from $1000 to $200,000—did the circumstances really merit the “maximum”?]

The Court found that the sufficiency of the Complaint was such that no genuine dispute of material facts would prejudice granting the motion. The Court also found that CitiHealth had sufficient notice of the complaint and therefore it is unlikely that CitiHealth's failure to respond and subsequent default resulted from excusable neglect. Finally, the Court, while recognizing the preference to have cases decided on the merits, found that CitiHealth's failure to answer Stephens Media's Complaint makes a decision on the merits impractical, if not impossible.

In the end, the Court entered a default judgment awarding $200,000 against CitiHealth as well as a permanent injunction against CitiHealth and its officers against any further use of the “Best of Las Vegas” mark. The Court also gave Stephens Media 30 days to file a motion for attorneys fees.

While its highly unlikely that Stephens Media will be able to collect on its $200,000 default judgment, one wonders if Stephens Media, should it be able to collect such funds, would be willing to pump that money into back into Righthaven LLC so that Righthaven can pay the money that it owes to its creditors (including multiple defendants that the Nevada District Court found were wrongly sued by Righthaven for copyright infringement). That’s probably even more highly unlikely.

New Blog Tracks the Las Vegas Sound Choice Lawsuit

noreply@blogger.com (Ryan Gile) — Fri, 20 Apr 2012 13:10:00 +0000

For regular readers who have noticed a lack of activity on this blog, it’s the classic conundrum of client demands getting in the way of blogging. I hope to be back to normal posting in mid-May (of course, I said that back in January and look what happened).

One story that I would have like to have covered is the “trademark infringement” lawsuit filed by Slep-Tone Entertainment Corporation against karaoke DJs (“KJs”) and venues in Las Vegas for alleged infringement of the SOUND CHOICE trademark. (Las Vegas Sun articles here and here).

I’ve been watching Slep-Tone pursue its “litigation business model” going all the way back to 2009 (back before Steve Gibson’s Righthaven brought a new name to the business model of filing lawsuits to get quick settlements). All one has to do is type “sound choice lawsuit” into a search engine and you’ll find numerous sources (e.g., SoundChoiceSucks) commenting on Slep-Tone’s lawsuit campaign (including Sound Choice’s own web page about why it is pursuing this “piracy campaign” and Sound Choice’s uber-aggressive investigation firm APS and Associates).

Well, it was only a matter of time before Slep-Tone made its way to “sin city” to troll for some quickie settlements here by filing a single, boilerplate lawsuit naming approx. 200 KJs and venues. See Slep-Tone Entertainment Corporation v. Ellis Island Casino & Brewery et al, Case No. 12-cv-00239 (D. Nev.) (lawsuit here). This lawsuit was actually a long-time coming. Slep-Tone’s investigation firm, APS, was trolling (pun intended) around Las Vegas last May and June 2011 doing its “investigations” into potential KJs and venues it could sue. Letters were sent out at that time citing the KJs as potential trademark violators – and demanding that they submit themselves to an audit to determine that their Sound Choice tracks were legitimate. Those who did not respond or otherwise settle are now the defendants in this mass-trademark infringement lawsuit.

I am a big believer that knowledge is power and using the internet to inform the public (particularly, in this case, small-time KJs who cannot afford to hire a lawyer to defend against Slep-Tone’s specious lawsuit). I was originally planning to start up a separate website that would monitor and track the Las Vegas Sound Choice lawsuit (posting the major court filings so that others could benefit from law firm work product as well as articles and other information already out there). A single resource that had good, usable information to assist those caught up in Slep-Tone’s questionable lawsuit.

Well, the lack of blogging here should be an indication of the time (or lack thereof) that I had to pursue such a project. And now someone else has beaten me to it.

Local attorney Robert J. Kossack, Esq. started up soundchoicelasvegaslawsuit.com. As he describes on his “About the Host” page, he started out writing an article for a magazine about the lawsuit and it took on a life of its own. His detailed post “Massive lawsuit threatens to change karaoke in Las Vegas” details the legal issues pretty well. (I don’t have the time to get into the merits of the lawsuit, but needless to say, I have always been bothered by the counterfeiting claims because it seemed like a reach on the part of Slep-Tone just so that it could threaten small-time defendants with statutory damages for infringement).

In addition, Mr. Kossack has not only made available all of the major court filings in the lawsuit (link here), but he even provides “template” joinders (one for motions to dismiss and one for motions to sever) that pro-se KJs who can’t afford an attorney can copy and paste (hey, what do you think lawyers do?) and file with the court so in order to “join” the motion to dismiss and motion to sever filed by the larger casino venues (PTs, Caesars, Treasure Island, Station Casinos) to ensure that Slep-Tone cannot get a default judgment against you (at least not at this early stage).

Mr. Kossack has done exactly what I wanted to do in order to inform the public (especially KJs) about the Las Vegas Sound Choice lawsuit. And that is why soundchoicelasvegaslawsuit.com is my new favorite blog. I think it has the potential to become another website along the lines of those which popped up during the Righthaven debacle (Righthaven Lawsuits, Righthaven Victims).

I just hope he doesn’t get too busy dealing with client demands -- after all, nothing worse than a blog where months go by without any new postings.

Trade Dress Protection does not Prevent a Competitor from Copying your Product

noreply@blogger.com (Mark Borghese) — Sat, 11 Feb 2012 18:57:00 +0000

[Post by Mark Borghese]

When a competitor makes an identical copy of your product, but sells the copy-cat product under a different brand name, do you have any recourse? What if your product and the competitor's product are so close they look as if they came from the same mold? Is that enough to sue?

Unless you have a utility patent, or some of the copied portions are artistic or ornamental, the answer is almost always no.

In the United States, utility patents are the only way to protect functional elements of a product. Over the years, litigants have made many attempts to protect product engineering with something other than a utility patent with very little success. Often, when a competitor duplicates a product there is no patent claim (because a patent was never granted), no trademark claim (because the product is sold under a different brand), and no copyright claim (because nothing artistic was copied). Often the only possible intellectual property claim left is "trade dress" which refers to the visual appearance of a product or its packaging that signals to consumers the product's source. But not just any visual appearances are entitled to trade dress protection. Only non-functional visual appearances count. This means something artistic or arbitrary in a product's design or packaging.

In Secalt S.A. v. Wuxi Shenxi Construction ___ F.3d ___ (9th Cir. 2012), one of the Plaintiffs, Tractel, Inc., manufactures and sells the Tirak traction hoist pictured below.

These type of traction hoists typically raise and lower swing stage scaffolding platforms on large buildings like this one sold by Tractel.

During a tradeshow in Las Vegas, Tractel saw a Chinese competitor, Jiangsu Shenxi Construction Machinery Co. ("Jiangsu") exhibiting a competing product that looked strikingly similar to Tractel's product.

Tractel sued the Chinese competitor in the District of Nevada alleging trade dress infringement. When discovery closed, both parties moved for summary judgment. The presiding district judge, James C. Mahan, ruled in favor of the Defendants. Judge Mahan found there was no trade dress infringement as all of the claimed "trade dress" served a functional purpose.

Plaintiff appealed to the Ninth Circuit Court of Appeals which upheld Judge Mahan’s ruling. The Ninth Circuit held:

Tractel's hoist is . . . a utilitarian machine with no indication that the visual appearance of its rectangular exterior design is anything more than the result of a simple amalgamation of functional component parts. Absent are any indicia of arbitrary or fanciful design. "To uphold a finding of infringement here . . . would suggest that the general appearance of almost any unpatented product rarely if ever could be copied faithfully. That is not the law." Leatherman, 199 F.3d at 1011. The form of Tractel's hoist follows its function, making the hoist a classic example of "de jure" functionality. We affirm the district court’s determination that Tractel did not present evidence sufficient to create a triable issue as to the nonfunctionality of its claimed trade dress.

Tractel attempted to argue that the overall exterior appearance of its product was non-functional due to its "cubist" and "modern" look and feel. The Ninth Circuit rejected these arguments. In fact, the court found Plaintiff's arguments to be nothing more than semantic trickery.

It is not enough to say that the design portrays a "cubist" feel—so does a square table supported by four legs. The fins may be attractive but they serve a functional purpose. And the cube-shaped gear box is simply housing. Except for conclusory, self-serving statements, Tractel provides no other evidence of fanciful design or arbitrariness; instead, here, "the whole is nothing other than the assemblage of functional parts, and where even the arrangement and combination of the parts is designed to result in superior performance, it is semantic trickery to say that there is still some sort of separate 'overall appearance' which is non-functional."

What Tractel really lacked in this litigation was evidence that any of its customers viewed the design of Tractel’s hoists as non-function or a source identifier. The Ninth-Circuit noted that one of Tractel’s customers testified that everything about the hoist design is functional.

[T]he entire design is predicated on function from what I've seen, and again as with most hoist manufacturers, every element on there is critical to the design otherwise they wouldn’t waste the money or the weight which again comes back to the weight is the key component. So in my opinion every element on there is important to the function.

The Ninth Circuit found that Tractel's other witnesses were just as unpersuasive.

From its own witnesses, Tractel at best offered either unsupported or conclusory claims about the design. Fatal to its claim was the testimony of its own witnesses who honestly laid out the functional nature of the design. Lacking was any evidence, like engineering notebooks or testimony from the designers, about design or aesthetics. Even more devastating was the testimony of third-party witnesses called by Tractel who laid bare the claim of nonfunctionality. For example, they testified that the fins play an important function of dissipating heat and are not for aesthetics. Likewise, the shape of the hoist is practical because it fits in confined construction sites and it is "more efficient and more compact" than some of the other hoists on the market.

Trade dress protection claims -- especially unregistered trade dress protection claims -- are notoriously difficult to prove. And, as the Ninth Circuit held here, impossible to prove without evidence that the design elements are non-functional.

--
About the author
Mark Borghese is a Las Vegas entertainment law attorney with the law firm of Borghese Legal, Ltd.

The Blog Posts That Never Were

noreply@blogger.com (Ryan Gile) — Wed, 18 Jan 2012 20:01:00 +0000

Oh how many times there have been where I wanted to blog about some interesting trademark story or legal development . . . only to have client needs get in the way. So many blog posts started, and so few ever finished. But that doesn’t mean I still can’t post a long list of them here – with links to articles and/or other blog postings that cover the topics as eloquently as I could have.

Let’s call it my Top 10 Missed Trademark Blog Opportunities.

10. Who Doesn’t Love Boobies!

Foundation which owns the I (Heart) Boobies trademark sues company for selling unauthorized I (Heart) Boobies bracelets. Complaint here. San Diego Reader Article.

9. The Platters Trademark Lawsuits Keeps Going and Going.

VegasInc Article Here. Amazing that the name still generates enough revenue to make these kinds of actions worthwhile.

(Scene from The Hangover Part II)

8. Louis Vuitton Sues Warner Brothers for Scene in the Hangover Part II.

Paid Content Article. Hollywood Reporter Article

Really, Louis Vuitton? How would anybody in the world know if the bag that Zach Galifianakis’ character references as a “Louis Vuitton” is fake or real? (frankly, you can barely even see it in the scene). More importantly, who would care even if they knew? (It doesn’t change the humor in the particular scene which is more about his mispronunciation of Louis as “loo-is”).

7. Pepsi and Frito Lay Sue Vegas Company for Creating “Diversionary Concealment Devices” Using Pepsi and Frito Lay Cans

Pepsi and Frito Lay accuse company of using their soft drink and food cans to create containers marketed to hide “illicit narcotics” and weapons. Complaint here. Courthousenews Article. Well of course such canister safes have to be created from Pepsi and Frito Lay’s original packaging bearing their trademarks – the police won’t be fooled by cans that says “Cola” or “Tortilla Chips.” Uh, duh!

6. Hasbro Files Section 1071(b) Action of PTO Opposition of “Motown Metal” trademark

After failing to overcome the trademark opposition to its application for register Motown Metal at the PTO (TTAB Decision here), Hasbro decides to pursue a Section 1071(b) action rather than appealing to the Federal Circuit. Complaint here. TTABlog Post on TTAB Decision here and Hasbro’s action here.

5. Petronas Towers Comes Crashing Down In Bid To Go After GoDaddy For Contributory Cybersquatting

Owner of the Petronas Towers in Kuala Lumpur, Malaysia, was not content to win control of the two domain names – petronastower.net and petronastowers.net – through in rem actions (previous blog post here); it just had to keep pushing to try to make GoDaddy liable in some way . . . and failed big time. Berhad v. GoDaddy, 09-5939 (N.D. Cal. Jan. 3, 2012). Technology & Marketing Law Blog Post (Post by Venkat Balasubramani). Of course, if the company was bold enough to have even maintained this action, it’s likely to be bold enough to appeal to the Ninth Circuit.

4. The Return of the Sliding Scale Test for Preliminary Injunctive Relief in the Ninth Circuit

The Ninth Circuit Court of Appeals explains how its old “sliding scale” approach to preliminary injunctive relief remains viable following the U.S. Supreme Court’s decision on the standard for preliminary injunctions in Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7 (2008). See Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1135 (9th Cir. 2011). Seattle Trademark Lawyer Blog Post.

3. Cupcakery Determined to Be Generic

The PTO finds CUPCAKERY to be generic and refuses registration:

The applicant’s mark is THE CUPCAKERY for, “Retail and online retail bakery shops.” CUPCAKERY is defined as, “A bakery which only sells cupcakes”. Please see the attached dictionary definition. THE CUPCAKERY immediately describes a feature or characteristic of the applicant’s services, specifically, the applicant is a bakery that sells cupcakes. Please see the attached evidence from the applicant’s website which shows that the applicant’s bakery sells cupcakes. Further, please see the attached third party Internet website evidence from www.frostedcupcakery.com, www.sibbyscupcakery.com,www.carolinacupcakery.com, www.ourcupcakery.com, www.batchcupcakery.com, www.buttercreamcupcakery.com, www.kumquatcupcakery.com, www.sugarcupcakery.com, sivadascupcakery.com, and sugarbabiescupcakery.com which shows that in the applicant’s industry a cupcakery is a bakery specializing in cupcakes and is commonly used by cupcake bakeries.

PTO File Wrapper for one of the four applications here. Of course, the applications were filed in September 2008 and one wonders if the mark, while possibly distinctive at the time of filing, became generic during their pendency.

2. Cavern Club files Section 1071(b) Action in Nevada District Court

Filed around the same time as the Hasbro case above – making TTAB appeals via Section 1071(b) appear to be growing in popularity. Not happy with the results it obtain at the TTAB (decision here), owner of the UK club that was popular venue for The Beatles sues Hard Rock to cancel CAVERN CLUB registration. Trademark Blog Post. Complaint here.

And Las Vegas Trademark Attorney's #1 Missed Blog Opportunity . . .

1. Ninth Circuit Determines that Renewal of Domain is Not Re-Registration

Or as I liked to say when the decision was issued . . . “I told you so!” (those who know me and my previous involvement in a cybersquatting dispute that involved this precise issue will understand what I mean). GoPets Ltd. v. Hise, Appeal No. 08-56110 (9th Cir. 2011). Technically, there was a blog post about this case on this blog (link here), but it was written by fellow local trademark attorney Mark Borghese (who was kind enough to contribute some blog content during a period of time last year that was particularly busy). Finnegan’s Incontestable Article.

The more interesting question, however, is does this now give cybersquatting immunity to domainers who purchase a domain name from another owner who happened to originally register the domain name at a time when no distinctive mark existed, but who then begin using such domain name in a way that would constitutes cybersquatting had the domainer’s purchase been considered a “registration” under the statute?

Honorable Mention -- The AIRFX Reverse Domain Name Hijacking Case

AirFX LLC won a UDRP decision over the domain name airfx.com (AirFX, LLC v. ATTN AIRFX.COM, Claim Number FA1104001384655 (NAF May 16, 2011)), and so the domain name owner, Mark Laurie, sought relief by filing a reverse domain name hijacking lawsuit. See Airfx.com et al v. AirFX LLC, Case No. 11-01064 (D. Ariz.). Not only did the court deny AirFX, LLC’s motion to dismiss, the Court also awarded Plaintiff $4086 in costs and fees for AirFX’s failure to waive service of process. Decision here. Technology & Marketing Law Blog Post.

A Real Dog of a Trademark Case

noreply@blogger.com (Ryan Gile) — Mon, 16 Jan 2012 20:24:00 +0000

People take their pets very seriously . . . and apparently the same is true with respect to their pet store trademarks.

On January 13, 2012, Puparazzi Industries of America LLC (“PIA”) filed a trademark infringement lawsuit in the U.S. District Court of the District of Arizona against Puparazzi Pet Spa LLC (“PPS”). See Puparazzi Industries of America LLC v. Puparazzi Pet Spa LLC, Case No. 12-cv-00084 (D. Ariz.). A copy of the complaint can be downloaded here.

According to the complaint, PIA is a mobile pet grooming van that provides its pet grooming services throughout the Phoenix, Arizona area using the marks PUPARAZZI MOBILE PET SPAW and WHERE YOUR PET’S THE STAR (which it claims to have been using in the area since May 10, 2010) and with bright pink and purple colors on its grooming van.

PIA only recently filed to register the mark PUPARAZZI MOBILE PET SPAW (which contains the odd concurrent use information “Regional and National). [Sidenote: The application does not appear to have been filed by an attorney, but instead by the company’s managing member]. The same company had an application on file for PUPARAZZI INDUSTRIES OF AMERICA (filed March 2010), but when it came time to show use of the mark, all that it could muster up was its specimen showing the mark PUPARAZZI MOBILE PET SPAW. The PTO rejected both the specimen of use (since it did not show the mark as applied in use) as well as the applicant’s attempt to alter the “drawing” of the mark from PUPARAZZI INDUSTRIES OF AMERICA to PUPARAZZI MOBILE PET SPAW (a material alteration).

PIA claims that defendant PPS began operating a pet grooming store in Phoenix, Arizona, using the marks PUPARAZZI PET SPA and EVERY DOG IS A STAR! (and the color pink on its website and facebook account) around September 2011. PIA’s causes of action are for federal trademark infringement and unfair competition.

This looks more like an example of a local “pet grooming store” name battle between two local business competitors (not as uncommon as you might think), rather than a company beginning to exert trademark rights to the word PUPARAZZI. I suspect that PIA’s “concurrent use” claim in its trademark application is a recognition by the owner of the company that there are other companies out there using the PUPARAZZI mark in connection with similar services including Puparazzi Dog Spa (in North Aurora, Illinois) and Puparazzi Pet Grooming (in Green Bay, Wisconsin). There is also a pet photographer using the name Puparazzi Portraits. And one man owns the registered trademark for PUPARAZZI in connection with pet clothing.

And to the extent PIA is able to prove both that it is the prior user of the mark the Phoenix, Arizona area as well as the scope of its reputation in the Phoenix, Arizona area, then it may very well likely be able to get PPS to change its name.

AMEX Wins Cancellation of BLACKCARD Trademark Registration

noreply@blogger.com (Ryan Gile) — Wed, 23 Nov 2011 01:06:00 +0000

American Express (“Amex”), the issuer of the ultra-exclusive “Centurion Card” credit card (which is black in color and thus better known among the public as the “Black Card” -- pictured above), won a victory in the U.S. District Court for the Southern District of New York against Black Card, LLC (“BC”), a company that obtained a trademark registration for the mark BLACKCARD (for credit and debit card services). The Court granted summary judgment in favor of Amex on its claim that BC’s trademark registration for BLACKCARD should be canceled on the grounds that it is merely descriptive and BC had not demonstrated acquired distinctiveness. See American Express Marketing and Development Corp, et al. v. Black Card, LLC, 2011 U.S. Dist. LEXIS 133151 (S.D.N.Y. November 17, 2011)

In 1998, Amex, following its long history of color-based credit cards reflecting a hierarchy of credit card prestige (i.e., green, gold, platinum), developed a black colored credit card which it called the Centurion Card and which was available by invitation only. While Amex never formally refers to the Centurion Card as the “Black Card,” Amex executives recognized that the public referred to its Centurion Card as the “Black Card” and thus often informally referred to the card as Amex’s “black card.” While Amex applied to register BLACK FROM AMERICAN EXPRESS, it never filed a Statement of Use and the application went abandoned.

(The other "Black Card")

In 2008, BC began issuing its own card (in connection with Barclays Bank Delaware and Visa) which was black in color and which had the words “BLACK CARD” emblazoned theron (pictured above). BC’s CEO Scott Blum, who founded Internet retailer Buy.com and who was a Centurion cardholder since Amex first introduced the card, began developing his black-colored premium credit card back in 2005 when he was CEO of Internet company called Yub, Inc. Blum, apparently frustrated with Amex’s Centurion services, sought to build a “better Black Card.” Yub applied for the BLACKCARD on September 20, 2005. The mark was published for opposition in May 2006 and, when no oppositions were filed, the PTO issued a Notice of Allowance in 2006. Yub later assigned all of its rights to the as-yet-unregistered mark to BC. [Query: Was this assignment of an intent-to-use application even valid under 15 U.S.C. § 1060? – see actual recorded assignment]

BC (and its predecessor) filed thirteen applications total between 2005 and 2009 for various BLACK CARD marks. Some were refused on the grounds that the mark was merely descriptive; in others, Examining Attorneys requested information from BC about whether consumers would associate the mark with a different provider of credit card services. Nonetheless, the PTO did issue the aforementioned trademark registration on April 29, 2009. However, for reasons not entirely clear, even though BC’s attorney had filed a preliminary amendment which inserted a disclaimer of the term BLACK apart from the mark as shown, the registration certificate did not reflect the disclaimer when it issued.

On May 13, 2009, Amex filed a petition to cancel with the Trademark Trial and Appeal Board. See American Express Marketing & Development Corp. et al v. Black Card, LLC, Cancellation No. 92050968 (TTAB). On February 16, 2010, BC filed an action in Wyoming that sought a declaratory judgment regarding Amex’s rights to “Black Card” as well as other trademark and unfair competition claims. On February 26, 2010, Amex filed the instant action in New York District Court alleging its own trademark and unfair competition claims as well as seeking to cancel BC’s registration under §2(e) of the Lanham Act. The TTAB’s proceeding was suspended on May 7, 2010, pending the outcome of the lawsuits. Moreover, Amex was able to get BC’s Wyoming complaint dismissed as an anticipatory filing. BC later refiled its counterclaims in the New York action. The parties later stipulated to have Amex's claims for monetary damages and BC's federal and state trademark infringement and unfair competition claims dismissed with prejudice. Upon close of discovery, the parties filed cross motions for summary judgment, with Amex moving for partial summary judgment on its §2(e) cancellation claim.

The court’s decision goes into a lengthy (but informative) discussion of its power to determine the right to registration of a mark, the standard for refusing registration of marks which are “merely descriptive” when used on or in connection with the goods/services of the applicant, the spectrum of distinctiveness with respect to protection of a mark (i.e., generic, descriptive, suggestive, arbitrary, and fanciful), and the rebuttable presumption which arises a mark that is registered by the PTO.

Regarding the rebuttable presumption, the court stated:

When the PTO issues a certificate of registration for a mark, a rebuttable presumption arises that the mark is protectable. Papercutter, 900 F.2d at 562-63. "Registration by the PTO without proof of secondary meaning creates the presumption that the mark is more than merely descriptive, and, thus, that the mark is inherently distinctive." Lane Capital, 192 F.3d at 345. The fact of registration, however, "shall not preclude another person from proving any legal or equitable defense or defect . . . which might have been asserted if such mark had not been registered." 15 U.S.C. § 1115(a). The party challenging the registration "bears the burden to rebut the presumption of [the] mark's protectability by a preponderance of the evidence." Lane Capital, 192 F.3d at 345. "The presumption may be rebutted by a showing that the mark is descriptive, not suggestive." Papercutter, 900 F.2d at 563.
The presumption, in short, is a "procedural advantage" to the registrant and nothing else. Lane Capital, 192 F.3d at 345. It is not "itself evidence of how the public actually views the mark." Id. "The presumption of validity that federal registration confers evaporates as soon as evidence of invalidity is presented. Its only function is to incite such evidence, and when the function has been performed the presumption drops out of the case." Id. (citation omitted).

So while the court gave BC’s BLACKCARD registration its appropriate rebuttable presumption of protectability by virtue of its 2009 PTO registration, the court found that Amex had demonstrated by a preponderance of the evidence that the mark is descriptive was descriptive, and thus not protectable absent secondary meaning. The court also found that “No reasonable factfinder could find that a prospective consumer would consider the mark to be suggestive rather than descriptive.” The court first noted that BC’s mark BLACKCARD appears on a black-colored credit card. “As with other credit cards, it enables its holders to make purchases on credit. The black color of the card is an essential feature or characteristic of the card. BC's advertising emphasizes the color, underscoring this point.” The court further noted that the word BLACK is descriptive in a second sense within the credit card industry:

Within the credit card industry, the word "black" is descriptive in a second sense as well. Largely through the efforts of Amex, the word "black", when used in connection with credit cards is understood to describe access to premium credit card services. Indeed, this was the very reason that Blum chose the mark "BLACKCARD" for his credit card. The term "BLACKCARD" immediately calls to mind an important aspect or characteristic of the product and describes the product's principal features and qualities. It is, in essence, communicating the grade of credit card offered by BC. The black-colored credit card marketed by BC is central enough to the overall product, however defined, to render "BLACKCARD" a descriptive mark.

Finally, following its determination that BC’s mark was descriptive, the court further found that BC had offerred no evidence of secondary meaning accruing to the mark BLACKCARD in order to support an argument of acquired distinctiveness.

BC attempted to argue that Amex lacked standing to seek to cancel BC’s mark, but the court rejected such arguments finding that Amex had “a significant, concrete, and real interest in proceedings to challenge the registration” based on its own use of the term “black card” in communications to prospective customers about the Centurion card (and noting that BC sued Amex for infringement).

BC also attempted to argue that its mark is not descriptive, but instead is suggestive of high-end financial services (citing cases where the color RED was held to be a protectable mark in connection with perfume and scotch whiskey). However, with respect to the Red Label mark on scotch whiskey, the mark did not serve as a grade designation; and with respect to RED on perfume, such reference suggested romance and passion to the prospective purchasers. In the instance case, the court found that BLACKCARD “merely describes the color of the card and the category of credit card services into which BC's card falls.”

As such, the court granted ary judgment for Amex on its cancellation claim under § 2(e) of the Lanham Act.

Recent Developments in Various Pending Trademark Cases

noreply@blogger.com (Ryan Gile) — Thu, 27 Oct 2011 13:00:00 +0000

Back in the good ole days of 2009-2010 when I actually had time to blog, I posted about three particular lawsuits filed in the District of Nevada – each of which had significant developments this week (all reported on by VegasInc’s Steve Green).

Arrow Productions Ltd. v. V.C.X., Ltd. et al, Case No. 09-cv-00737 (D. Nev.) (previous blog post here)

The copyright and trademark dispute over “Deep Throat.” As reported by VegasInc., the parties reached a settlement whereby VCX agreed to stop selling “Deep Throat” (the copyright to which Arrow claimed) and Arrow agreed to stop selling “Debbie Does Dallas” (the copyright to which VCX claimed). As part of the court’s order and judgment (copy here), there are stipulated facts regarding the chain of title for the copyright to the film “Deep Throat” (including addressing the issue of how copies of the film were distributed without a copyright notice, and yet how that did not put the film in the public domain because the copyright owner technically leased the theaters when the film was shown (so-called “four walling”) and retained control over the prints – with any other copies being unauthorized prints).

Mine O'Mine, Inc. v. Michael Calmese, True Fan Logo, Inc. and Dan Mortense, Case No. 10-cv-00043 (D. Nev.) (previous blog post here)

The trademark lawsuit filed by Shaquille O’Neal over Defendants’ use of the mark SHAQTUS. As reported by VegasInc., the court issued a detailed summary judgment ruling earlier this year (copy here) that found the Defendants only started using the mark SHAQTUS after sportswriters gave O’Neal that name when he began playing for the Phoenix Suns and that there was a likelihood of consumer confusion arising between shirts sold by O’Neal’s company and SHAQTUS shirts sold by Defendants. This week, the court entered judgment against the Defendants (copy here) which terminated the litigation because of O’Neal’s willingness to drop the cybersquatting and dilution claims that remained following the court’s summary judgment order.

Caesars World, Inc. v. July et al, Case No. 11-cv-00536 (D. Nev.) (previous blog post here)

The cybersquatting action filed by Caesars Palace against Marcel July and his use of the mark OCTAVIUS TOWER. As reported by VegasInc., the court denied July’s motion for preliminary injunction (copy here) finding that July failed to meet the necessary burden to merit injunctive relief. July’s only argument was his PTO registration for the name OCTAVIUS TOWER for entertainment services (along with some state registrations). The court noted that while the registration served as prima facie evidence of July’s exclusive rights to use the mark for entertainment services, such evidence can be rebutted – and in this case, the court found that Caesars had made “strong arguments” against July’s use of the mark that “extinguishes” July’s prima facie case. July did not respond to Caesar’s arguments. Moreover, July also failed to demonstrate irreparable harm, balance of hardships favoring him, or that that injunction would be in the public interest.

GoPets v. Hise, Does Transferring a Domain Name Create a New "Registration" under the ACPA?

noreply@blogger.com (Mark Borghese) — Sun, 23 Oct 2011 16:41:00 +0000

[Post by Mark Borghese]

The Anticybersquatting Consumer Protection Act ("ACPA") provides that a person is liable to a trademark owner when the person (1) registers a domain name, (2) in bad faith, (3) that at the time of registration was “identical or confusingly similar to” a distinctive trademark. See 15 U.S.C. § 1125(d)(1).

When analyzing claims under the ACPA, timing is critical. Often an entity will acquire trademark rights long after a domain name is first registered. When a domain name is registered and continuously maintained by a single individual or entity, what is meant by the "time of registration" of the domain name is clear. It is the date the domain name was first registered.

The question courts have grappled with is whether transfers of a domain name from one registrar to another constitutes a "new registration" or whether transfers from one entity to another constitutes a "new registration." If these transfer are "new registrations" then the registration date of the domain name may be reset to a point after the trademark owner acquired rights in a trademark. In those instances, the trademark owner has an opportunity to use the ACPA to acquire domains which were originally registered before it had any trademark rights.

The underlying legal question really boils down to this: is the ownership of a domain name a property right or a contractual right? If a domain name is a property right then rights acquired when a domain name is first registered are freely transferable to a subsequent owner. If a domain name is merely a contractual right, then the rights may change every time a new agreement is signed with a registrar and every time a new owner signs an agreement with a registrar.

On September 22, 2011 the United States Court of Appeals for the Ninth Circuit issued a ruling in GoPets v. Hise, __ F.3d __, (9th Cir. 2011) that ownership of a domain name is a property right. Specifically, the Ninth Circuit held that that the term "registration" under the ACPA applies to the very first time a domain name is registered. Rights which existed at the time a domain name was registered (e.g. that the registration was not in "bad faith" and was not "identical or confusingly similar" to an existing trademark) are not lost simply because the domain name was transferred to a new entity.

In GoPets, the defendant Edward Hise registered the domain name gopets.com in 1999. Hise had a few ides for a site he might develop with the domain name, but never did much with it. In 2004 a Korean company, GoPets Ltd. developed a virtual pet game called GoPets which involved creating and customizing a virtual pet that would live on your computer's desktop.

In October 2004, GoPets Ltd. first approached Hise about buying the GoPets Ltd. domain name. GoPets Ltd. offered a paltry $750 to Hise. This offer was first ignored by Hise and later rejected. Seven months later in May 2005 GoPets Ltd. tried again. Instead of raising its offer, however, it threatened Hise with an ICANN domain dispute claim and lowered its offer to $100.

GoPets Ltd. attempt at intimidating and insulting Hise was fruitless and a dispute before the Internet Corporation for Assigned Names and Numbers ("ICANN") was commenced a year later in May 2006. In July 2006 a WIPO arbitrator decided in favor of Hise. The ruling was simple-- Hise had registered the domain name in 1999 well before the GoPets game was developed in 2004. Hise clearly did not have a bad faith intent to register the domain name at the time he registered it.

A few months after the WIPO decision, GoPets Ltd. increased its offer to $5,000 and then to $40,000. Instead of negotiating, Hise got greedy. In response, Hise sent a four page letter to GoPets Ltd. demanding a ridiculous $5 Million for the domain. Two days after sending this letter, Hise transferred gopets.com from himself to his brother's corporation Digital Overture. This transfer was a critical error by Hise as under prior court rulings this type of transfer was a "new registration" of the domain name which re-set the date of registration from 1999 to 2006.

GoPets Ltd. immediately pounced on this mistake and filed an action in federal court in the Central District of California. The district court granted summary judgment in favor of GoPets Ltd. finding that Digital Overture's "registration" of the gopets.com domain name in 2006 was done after GoPets Ltd. had acquired its trademark rights and was therefore in "bad faith." Hise appealed to the Ninth Circuit.

The Ninth Circuit reversed the District Court's ruling and held that "registration" under the ACPA refers to the first registration of a domain name. The court found that ownership of a domain name is a property right and rights acquired in a domain name when it is first registered are not lost when that domain name is transferred to a new entity. The court held,

Looking at ACPA in light of traditional property law, however, we conclude that Congress meant “registration” to refer only to the initial registration. It is undisputed that Edward Hise could have retained all of his rights to gopets.com indefinitely if he had maintained the registration of the domain name in his own name. We see no basis in ACPA to conclude that a right that belongs to an initial registrant of a currently registered domain name is lost when that name is transferred to another owner. The general rule is that a property owner may sell all of the rights he holds in property. GoPets Ltd.’s proposed rule would make rights to many domain names effectively inalienable, whether the alienation is by gift, inheritance, sale, or other form of transfer. Nothing in the text or structure of the statute indicates that Congress intended that rights in domain names should be inalienable.

In making this ruling, The Ninth Circuit specifically disagreed with the Third Circuit's decision in Schmidheiny v. Weber, 319 F.3d 581 (3d Cir. 2003). The Ninth Circuit held that the ACPA applies to domain names registered both before and after the ACPA became law in November 1999 which would allay the concerns the Third Circuit expressed in that case. The Ninth Circuit held,

The Third Circuit assumed that Weber’s initial registration of schmidheiny.com was not covered by § 8131(1)(A) because it had been made before the passage of ACPA. See id. at 581-82. Based on that assumption, the Third Circuit was concerned that holding that re-registration was not “registration” within the meaning of ACPA would “permit the domain names of living persons to be sold and purchased without the living persons’ consent, ad infinitum, so long as the name was first registered before the effective date of the Act.” Id. However, we believe that the Third Circuit erred in assuming that Weber’s initial registration was not covered by ACPA. We agree with the holding of the Second Circuit in Sporty’s Farm that § 1125(d)(1)—and, by extension, § 8131(1)(A)—apply to registrations made before the passage of ACPA. See Sporty’s Farm, 202 F.3d at 496-97. If Weber’s initial registration violated § 8131(1)(A), as we would hold it did, the Third Circuit’s concern evaporates.

So will other circuits adopt the Ninth Circuit's reasoning and find that domain names are property rights? The law does seem to be moving in that direction, but there are always exceptions and exceptional cases which may warrant a different view.

EPILOGUE

So Hise won. Or did he? Perhaps the bigger lesson in this case is how the value of the gopets.com domain name plummeted during the appeal. While today, in 2011 Hise retains his ownership interest in gopets.com, the brand "GoPets" was abandoned in late 2009 when Zynga purchased GoPets Ltd.'s assets. Zynga immediately shut down "GoPets" and launched a revamped service, PetVille.

The value of gopets.com is now far less than it was before the GoPets brand was abandoned by Zynga. In retrospect, both parties should have negotiated in good faith. Back in October 2006 Hise should have negotiated with GoPets Ltd. in good faith when it offered $40,000 for the domain name instead making a ridiculous counter-demand for $5 Million. Likewise GoPets Ltd.'s initial offer of $750 and its subsequent offer of $100 were equally ridiculous, if not more so.

The lesson here is two-fold. Failing to negotiate in good faith can lead to unnecessary lawsuits and lawsuits often last longer than internet companies or their brands.

--
About the author
Mark Borghese is a Las Vegas trademark attorney with the law firm of Borghese Legal, Ltd.

Battle of the "Bays": Tradebay vs. eBay

noreply@blogger.com (Mark Borghese) — Wed, 21 Sep 2011 19:22:00 +0000

[Post by Mark Borghese]

Does an intent-to-use trademark applicant, faced with a trademark office opposition proceeding, have the right to seek declaratory relief in federal court? Or, does the fact that the applicant has not yet used the mark in commerce prevent a federal court from exercising jurisdiction?

Those are the legal question a federal court in the District of Nevada will have to answer in Tradebay v. eBay, Case No. Case 2:11-cv-00702-ECR -PAL.

This dispute began almost two years ago when, on January 6, 2009, Tradebay filed a trademark application with the United States Patent and Trademark Office for the mark TRADEBAY for various services including "computerized online ordering" and "operating online marketplaces for seller and buyers of goods and/or services."

When Tradebay's trademark was approved by the trademark office and published for opposition, eBay immediately opposed the mark claiming that consumers would confuse Tradebay and eBay. In support of this opposition, eBay cites Perfumebay.com Inc. v. eBay Inc., 506 F3d 1165 (9th Cir., Nove. 5, 2007) where the Ninth Circuit Court of Appeals stated that the term "BAY" was the dominant portion of the eBay mark. From this ruling, eBay argues that any "generic" + BAY mark in the internet marketplace space is likely to cause confusion and dilute eBay's distinctive mark.

After the opposition was filed, on May 3, 2011, Tradebay filed a declaratory relief action in the United States District Court, District of Nevada. Tradebay wanted a federal court to make the determination as to whether its mark, Tradebay, was likely to be confused with the famous eBay mark. The Trademark Trial and Appeal Board proceeding was thereafter stayed in light of the District Court lawsuit.

On June 28, 2011, eBay filed a motion to dismiss Tradebay's District Court lawsuit alleging that no case or controversy existed for the court to decide. The motion argues that dismissal pursuant to Fed. R. Civ. P. 12(b)(6) is the appropriate remedy as no trademark infringement can exist when Tradebay has not yet used the Tradebay mark in commerce.

Courts enforcing Rule 12(b)(6) curtail this risk by weeding out complaints that fail to give rise to a plausible inference of harm to the plaintiff. Neither eBay nor the Court should be required to expend the resources necessary to litigate the merits of claims of trademark infringement and dilution and unfair competition based on nothing more than vague and conclusory allegations that fail to evince the specific and concrete steps to use the mark that might give rise to a controversy of sufficient immediacy and reality to warrant the issuance of a declaratory judgment. Dismissal is the appropriate remedy here.

Tradebay filed an opposition to the motion on August 2, 2011, arguing that the "case or controversy" standard has been met and pointing out that as early as January 30, 2009 Tradebay received a cease and desist letter from eBay accusing it of infringing and diluting eBay's trademark rights.

Tradebay’s complaint presents an "actual controversy" within the meaning of the caselaw. Specifically, almost immediately after Tradebay filed its trademark application, eBay sent a cease and desist letter. If Tradebay refused eBay's demands, eBay threatened to "take whatever actions eBay deems necessary to protect its rights." Exhibit 2-A. eBay reaffirmed the identical threat a few days later. Exhibit 2-B. Once Tradebay’s application was accepted for publication, eBay opposed it in the USPTO. Exhibit 3-A.

In its reply brief filed August 25, 2011, eBay argues again that no case or controversy exists as Tradebay has not taken any concrete steps to actually use its Tradebay mark, such as developing a product line, conducting market research, or creating packaging and advertising.

Tradebay makes no attempt to show that it has alleged, let alone actually undertaken, any concrete steps to actually use the TRADEBAY mark in connection with any goods or services. At best, Tradebay has alleged nothing more than a vague and indefinite desire to use the TRADEBAY mark at some future date. That does not come close to showing a real and immediate controversy. Tradebay's utter failure to allege the requisite concrete steps can only lead to the conclusion that it has not engaged in any such activity. Under these circumstances, it would be a waste of the Court's (and eBay's) time and resources to render what would amount to an impermissible advisory opinion as to whether activities Tradebay may or may not undertake in the future would infringe or dilute eBay's trademarks.

Under the facts in this case, eBay argues that Tradebay is simply requesting that the court issue an improper advisory opinion rather than settle an actual trademark infringement dispute involving two competing marks being used in commerce.

The briefing on this issue is now closed and an order from the court is expected within the next ninety days. This ruling will be an interesting one to watch.

About the author
Mark Borghese is a Las Vegas internet attorney with the law firm of Borghese Legal, Ltd.

Another Epic Trademark Battle Prematurely Ends With Amicable, Reasonable Settlement

noreply@blogger.com (Ryan Gile) — Sat, 27 Aug 2011 00:55:00 +0000

Tropicana Las Vegas

In one of my longer blog posts last year (link here), I detailed the convoluted and complicated history of the TROPICANA Hotel/Casino trademark – a fascinating look at how trademark rights are handled in the course of multiple large scale corporate transactions (including bankruptcy proceedings) and how certain things can (and indeed do) fall through the cracks.

What started out as a simple declaratory judgment action in Nevada state court by the new owners of the Tropicana Hotel & Casino in Las Vegas regarding their long-time right to use the name Tropicana in connection with that specific hotel/casino located at the intersection of Las Vegas Blvd. and Tropicana Avenue blew up into an epic lawsuit filed in Delaware Bankruptcy Court by a group of companies lead by Carl Icahn's Tropicana Entertainment Inc. The matters had been fully briefed by both sides and were awaiting a court hearing.

But alas, now we’ll never know how exactly the bankruptcy court would’ve unraveled the convoluted trademark issues raised by Tropicana Entertainment’s adversary proceeding (we know how the Clark County District Court decided those issues, but that is in part what led to Tropicana Entertainment to file the adversary proceeding it did in bankruptcy court).

As reported by VegasInc’s Steve Green (link here), the parties announced in mid-August that they had reached a Settlement that resolves the outstanding trademark disputes and which provides for an agreement regarding concurrent use by both parties of the mark TROPICANA. A copy of the Settlement Agreement, with all of its provisions regarding concurrent use of the Tropicana name by the respective parties, can be viewed here.

In short, Tropicana Las Vegas can continue to use the mark TROPICANA LAS VEGAS (or TROP LAS VEGAS) or TROPICANA LV (or TROP LV) in the city of Las Vegas, Nevada and within a 50 mile radius from the present location of the Tropicana Las Vegas Hotel and Casino. Tropicana Las Vegas can promote itself worldwide so long as it always mentions the property location. Tropicana Las Vegas does not get any other rights to use the mark TROPICANA, TROP, or any variation thereof apart from its rights to use the mark in reference to its Las Vegas property (although a small exception is made for on-property signage and certain marketing campaigns such as “Trop ‘Til You Drop” and “Trop Party Pass” so long as there is also a reference to the Las Vegas location). The agreement expressly consents to Tropicana Las Vegas’s use of the following logo

and clarifies that in any other logos used by Tropicana Las Vegas, the Las Vegas (or LV) portion of the mark shall not be smaller or less prominent in proportion to TROPICANA or TROP than as reflected in the above logo.

As for what Tropicana Entertainment gets out the deal, it gets the exclusive rights to use TROPICANA and TROP, but provided that it also is accompanied by some other mark indicating either a geographic location (other than Las Vegas obviously) or some other mark to identify services currently offered by Tropicana Entertainment (e.g., Tropicana Advantage).

The Agreement also deals with how the parties will handle present and future trademark registrations for marks using TROPICANA, use of their respective marks on the Internet, and issues relating to enforcement of rights in their respective territories.

By entering into this Settlement Agreement (with concurrent use provision regarding the trademark rights), the parties certainly ended up doing the smart thing in reaching an amicable settlement – bringing to a halt a dispute that had likely cost the parties millions of dollars in attorney fees and costs (fees that would have continued to be incurred given the high stakes) and doing so in a way that brings certainty to the rights of the parties moving forward. And it was probably the fair outcome given the long-time association that the world does have with the name Tropicana in connection with that particular hotel in Las Vegas while at the same time recognizing Tropicana Entertainment's investment in the name outside of Las Vegas.

Of course, at the same time, it would’ve been interesting to see which way the bankruptcy court would have sided in this dispute (and the legal rationale for such decision).

Mystic Lodge Loses Trademark Battle with Mystic Lake

noreply@blogger.com (Mark Borghese) — Tue, 16 Aug 2011 15:26:00 +0000

Mystic Lake Casino Hotel in Minnesota

[Post by Mark Borghese]

As first reported by Steve Green, Mystic Lodge casino in Henderson ("Mystic Lodge") lost its trademark dispute with the Mystic Lake Casino Hotel in Minnesota ("Mystic Lake"). This case was first discussed on this blog here. In a July 25, 2011 order, U.S. District Judge James Mahan issued a Final Judgment and Permanent Injunction against Mystic Lodge ordering it to change its name.

Mystic Lodge Casino in Henderson, Nevada

The chips were stacked against Mystic Lodge from the beginning of this case. Not only are the two marks, Mystic Lodge and Mystic Lake substantially similar, but both marks are for the same services. Moreover, the senior user, Mystic Lake has been using its servicemark for almost twenty years and has multiple federal registrations.

Although a small Henderson, Nevada casino with no hotel and a large Minnesota Indian hotel casino resort may seem worlds apart, the Minnesota tribe which runs Mystic Lake argued in its Motion for Summary Judgment that both casinos operate on a national level and compete for the same customers.

[T]he undisputed evidence supports the conclusion that Mystic Lake Casino and Mystic Lodge Casino operate in a market that includes a nation-wide consumer base. First, more than 100 of the same individuals appear in both Mystic Lake Casino and Mystic Lodge Casino’s respective player databases… Mystic Lake and Mystic Lodge also have player databases that include residents of all 50 states… Both Mystic Lake and Mystic Lodge casino services expressly cater to travelers and tourists… In fact, both parties have thousands of customers in Nevada alone…. Simply put, [Mystic Lake] and [Mystic Lodge] compete for the same discretionary consumer dollar—Mystic Lodge is a competitor of Mystic Lake.

Mystic Lodge attempted to argue the Dawn Donut rule as a defense to the issuance of an injunction against it. That rule, first set out in the case Dawn Donut Co., Inc. v. Hart’s Food Stores, Inc., 267 F.2d 358 (2d Cir. 1959) provides a defense to the issuance of an injunction against a good faith junior user of a trademark which adopts the mark without knowledge of the federally registered mark and which operates in a geographically separate and distinct trading area to the senior user.

Judge Mahan however, ruled that the Dawn Donut defense was not applicable to the facts before the court because Mystic Lodge had actual knowledge of the federal registration for Mystic Lake, but decided to adopt the mark anyway.

The defendants argue under Dawn Donut that when two marks are confined to sufficiently distinct and geographically separate markets, without evidence that the registrant will expand to the defendant’s market, the plaintiff is not entitled to enjoin the junior user’s mark. See 267 F.2d at 364. Further, the “injunctive remedy does not ripen until the registrant shows a likelihood of entry into the disputed territory.” McCarthy, supra, at § 26:33. In the alternative, the defendants’ assert that there is a presumption of good faith since an opinion letter from counsel permitted the use of the mark. The court disagrees.

Here, the Dawn Donut defense does not apply to the plaintiff’s ability to receive injunctive relief due to the bad faith shown. The defendants received actual knowledge of the plaintiff’s registered mark through counsel, ignored requests for alternate names, and disobeyed express recommendations on how to limit the possibility of infringement. Although the final opinion letter by counsel timidly approved the use of the mark with certain limitations, the email from counsel advising that the mark was already registered and the senior user would aggressively protect it disallows the final opinion to serve as a rubber stamp for the defendants’ actions. “The Ninth Circuit does not . . . insulate the defendant from a finding of willful infringement based on advice of counsel of noninfringement.” Monster Cable Prods., Inc. v. Discovery Commn’s, Inc., No. C 03-03250, 2004 WL 2445348, *9 (N.D. Cal. Nov. 1, 2004) (citing Wolfe v. Nat’l Lead Co., 272 F.2d 867, 871 (9th Cir. 1959).

The lesson, of course, is to follow the recommendations of your attorney. Moreover, if you are willing to spend the money to get an attorney’s opinion about potential trademarks, use the advice to pick a name that (1) not federally registered and (2) is not the name used by a competitor in the United States for the same goods and services you want to sell.

The Final Judgment and Permanent Injunction prevents Mystic Lodge from,

(a) Distributing, displaying, marketing, promoting, offering for sale, and/or selling any goods or services using the mark Mystic Lodge Casino, or any other phrase, slogan, or business name that incorporates the word “Mystic” (a “Mystic Mark”);

(b) Affixing a Mystic Mark to any product, advertisement, point of sale material, interior/exterior signage or other promotional material;

(c) Disseminating any product, advertisement, point of sale material, signage or other promotional material containing or incorporating a Mystic Mark;

(d) Registering any domain name which includes the word “mystic” or any Mystic Mark; and

(e) Registering and/or applying for any trademark registration for a Mystic Mark.

The Judgment also gives Mystic Lake sixty (60) days to provide written confirmation that it is no longer using the Mystic Lodge mark and transfer all domain names which include the Mystic Lodge Mark to Minnesota casino.

Mystic Lodge has now filed an emergency motion to stay the ruling pending it’s appeal to the Ninth Circuit. In the motion, Mystic Lodge argues,

If a stay is not granted, Defendants face the risk of being put out of business complying with a permanent injunction before having been ultimately found by a jury not to have infringed upon Plaintiff's mark. Equally important, Plaintiff will not be harmed by a temporary stay of the permanent injunction pending appeal.

Of course Mystic Lodge can simply change its name and re-brand its business. While such a move may be expensive, so is an appeal to the Ninth Circuit Court of Appeals. This case once again highlights the importance of local Las Vegas businesses obtaining national trademark protection for their brands.

About the author
Mark Borghese is a Las Vegas business attorney with the law firm of Borghese Legal, Ltd.

A Lot of Love in Las Vegas Lately

noreply@blogger.com (Ryan Gile) — Wed, 13 Jul 2011 07:01:00 +0000

[or alternatively, "Anything You Can Trademark, I Can Trademark Better."]

Earlier this year, as local Las Vegas hotel-casino chain Station Casinos was emerging from bankruptcy, it made a large splash about its new marketing campaign focusing on the locals market in Las Vegas and embracing the marketing slogan WE LOVE LOCALS (news story on the rebranding here).

So what did rival hotel-casino South Point decide to do? Came up with its own marketing slogan that not only is able to take advantage of the notoriety developed by Station Casinos in its LOVE mark, but able to clearly distinguish itself from Station Casinos at the same time (South Point's "Love" website here).

Clever comparative marketing (if you ask me) -- I wonder how Station Casinos feels about sharing the love.

Golden Nugget's Cybersquatting Campaign

noreply@blogger.com (Ryan Gile) — Thu, 02 Jun 2011 03:55:00 +0000

GNLV, Corp., the company which owns the Golden Nugget Hotel & Casino in downtown Las Vegas (as well as Golden Nuggets in Laughlin and Atlantic City), continues its campaign to go after cybersquatters. After a two year lull of filing any type of cybersquatting lawsuits, GNLV has now filed five since April 27, 2011. [Ed.—Is this perhaps a sign of the improving economy that a gaming company is willing to invest the money to pursue such lawsuits in order to obtain (and/or prevent others from using) domain names of questionable value?]

In late April, GNLV Corp sued German resident Luca Mueller over the domain golddennugget.com (with an extra “d” in the spelling of Golden) which GNLV alleged linked to an online gambling site. See GNLV, Corp. v. Mueller, Case No. 11-cv-00663 (D. Nev. Filed April 27, 2011). (VegasInc article here.) Later in May, GNLV Corp. sued Kanter Associates over the domain name thegoldennuggett.com (with an extra “t” in the spelling of Nugget) which GNLV alleged linked to a travel reservation website. See GNLV, Corp. v. Kanter Associates SA, Case No. 11-cv-00827 (D. Nev. Filed May 20, 2011). (VegasInc article here.)

On May 31, 2011, GNLV filed three more cybersquatting lawsuits. The first lawsuit against Harald Ebert relates to the domain name www.goldennugget.info, which GNLV claims is linked to a website which offers “links to many of the same wagering games that are offered at Plaintiff’s casino resorts, such as Blackjack, Poker and Slots.” See GNLV, Corp. v. Mueller, Case No. 11-cv-00875 (D. Nev.). The second lawsuit against Marco Eckstein relates to the domain name www.golden-nugget-jackpot.com, which GNLV claims is linked to a website which offers “links to many of the same wagering games that are offered at Plaintiff’s casino resorts, such as slots.” See GNLV, Corp. v. Eckstein, Case No. 11-cv-00878 (D. Nev.). The third lawsuit against Hilary Moore involves the domain name www.seventysevengoldennuggets.com. See GNLV, Corp. v. Moore, Case No. 11-cv-00873 (D. Nev.). As for why GNLV can claim that the registration of this last domain name, which would be perceived by almost anybody as “77 Golden Nuggets” and not likely associated with GNLV’s GOLDEN NUGGET mark, constitutes cybersquatting? It would be because, according to the complaint, the domain name is linked to “a site offering a direct link to the Golden Nugget resort-hotel travel and reservation services, including a direct link to Plaintiff’s property located in Las Vegas, Nevada.” [ed.—might’ve been an easier case to defend had Defendant used the website in connection a gold mining business].

Of course, while I didn’t review the particular website printout exhibits attached to each complaint, a quick visit to each of the above domain names shows that they are your typical “landing page” offering various pay-per-click (“PPC”) generated ads (some of which may, as GNLV alleges, go to websites offering “the same wagering games offered by Plaintiff’s casino resorts” or to “resort-hotel travel and reservation services”). Are any of these particular websites truly causing economic harm to GNLV? Highly doubtful. So why is GNLV spending money filing lawsuits to go after domains that don’t really have much direct value for GNLV (and are certainly not diverting any business to GNLV’s own hotel/casino)? Perhaps simply because it can . . . and because it’s not as costly as you might think

When one considers that the minimum cost that a trademark owner would incur to file a domain name arbitration action under the UDRP is around $3000 (including fees paid for the arbitrator) and with an uncertain outcome (as anybody who has been involved in UDRP arbitrations will tell you), these lawsuits are a much much more cost effective way for a company to obtain possession of these domain names ($300 lawsuit filing fee, $100 bond, and maybe around $500-$1000 per case for attorneys fees and costs (assuming great economies of scale), since most of the documents are nearly identical and can be prepared mostly by administrative staff). In addition, unlike in a UDRP action, the lawsuit route allows the complainant to make a claim towards statutory damages for cybersquatting (minimum $1000 up to $100000 per domain name). Given the low likelihood that the Defendants will even respond to the complaints, each lawsuit has the strong potential to garner a $100,000 default judgment (albeit a judgment that is more often than not nearly impossible to collect).

Still, even at a price of about $1000 per domain name, one wonders why GNLV wants to invest even that amount of money for some of the domain names it is seeking. All GNLV is doing is preventing other third parties from obtaining a relatively minuscule amount of PPC revenue from the PPC ads showcased on the landing pages for each of these websites. As for the websites involving typosquatting, I continue to maintain that the vast majority of web users looking for GNLV’s GOLDEN NUGGET are saavy enough with respect to internet browsing that they will not be sidetracked by a landing page that offers links to an online casino or other hotel/casino – and will instead recognize their typo and retype the correct URL address or perform a search using one of the more popular internet search engines (which are certainly not fooled by these websites). When all is said and done, GNLV will be the proud owner of several domain names that will likely do very little in promoting the GOLDEN NUGGET brand and will generate very little additional traffic for GNLV's websites (along with very little additional revenue) beyond what GNLV would’ve already had, but which GNLV now will have to continue to pay annual registration fees in order to maintain these domain names. But I guess GNLV considers that fee (along with the fees paid to its lawyers for these sutis) a small price to pay to prevent domainers from making a single penny (literally) off of the GOLDEN NUGGET mark.

[UPDATE (July 26, 2011) -- Ron Coleman's Likelihood of Confusion® blog provides his response to my query here -- along with a shameless proposal to the people at the Golden Nugget to "handle their cost-effectiveness-be-damned domain trademark enforcement programs."]

Egg Works Loses 9th Circuit Appeal Despite No Opposition From Egg World

noreply@blogger.com (Ryan Gile) — Wed, 27 Apr 2011 21:01:00 +0000

The owners of the Las Vegas breakfast restaurants The Egg & I and Egg Works got another dose of egg on their face when the Ninth Circuit Court of Appeals affirmed a lower court’s decision to deny the restaurant chain's motion for preliminary injunction that had been sought against a competing Las Vegas restaurant named Egg World (which did not even file any kind of brief in the appeal).

Last June, Bradley Burdsall, along with his two companies Egg Works, Inc. and Egg Works 2, LLC (collectively “Egg Works”), brought a trademark infringement lawsuit against Egg World, LLC, and two of its principals, Gabrijel Krstanovic, and Dejan Debeljak (collectively “Egg World”). See Egg Works, Inc. et al v. Egg World LLC et al, Case No. 10-cv-01013 (D. Nev.). On September 14, 2010, the lower court entered an order denying Egg Works’ Motion for Preliminary Injunction. (a copy of that order can be viewed here). For my previous blog post discussing the lower court’s decision, click here.

Because the counsel of record for Egg World in the lower court case withdrew from the case soon after the court’s decision (the basis for withdraw was a dispute over money – an unfortunate, all too common issue in litigations), Egg Works recognized that if it appealed the court’s denial of its motion for preliminary injunction, the Egg World defendants would probably not file any kind of brief in such an appeal. And so Egg Works filed an appeal to the Ninth Circuit Court of Appeals of the lower court's decision to deny Egg Works’ Motion for Preliminary Injunction. And if the defendants don’t file an any kind of brief in the appeal, Egg Works would easily win, right? Well as this case aptly demonstrates, that’s not necessarily true.

On September 27, 2011, the Ninth Circuit Court of Appeals in an unpublished decision rendered without oral argument (and without the benefit of any kind of briefs from the Egg World defendants) affirmed the Nevada District Court’s decision to deny Egg Works’ Motion for Preliminary Injunction. See Egg Works, Inc., et al v. Egg World LLC, et al, Appeal No. 10-17534 (9th Cir. April 27, 2011) (unpublished). A copy of the decision can be downloaded here.

The decision is fairly straightforward, with the Court of Appeals finding no abuse of discretion on the part of the lower court in denying Egg Works’ Motion for Preliminary Injunction:

The district court correctly identified the legal standard for likelihood of confusion of a trademark, its findings were not clearly erroneous, and the district court did not clearly err in finding no likelihood of confusion concerning appellants’ trademark. See AMF Inc. v. Sleekcraft Boats, 599 F.2d 341, 348-49 (9th Cir. 1979). We conclude that the district court did not abuse its discretion in concluding that appellants failed to meet the requirements to merit preliminary injunctive relief. Accordingly, we affirm the district court’s denial of appellants’ motion for a preliminary injunction.

So where does the case go from here? Well, assuming Egg Works decides not to waste any more money by seeking reconsideration or appealing to the U.S. Supreme Court, the case goes back to Nevada district court and continues to move forward. But with Egg World not currently represented by counsel, Egg Works will now be able to obtain a default and seek a default judgment against thecompany. And Egg Works may try to seek defaults against the individual defendants as well, who have not show any particular interest in continuing the fight in court (even though they did win both at the lower court and on appeal – although admittedly only at an early preliminary stage).

Of course, given that the Egg World restaurant that gave Egg Works so much heartburn last year closed down earlier this year [Comment—I know from firsthand experience that running a restaurant is tough, and probably more so in these economic times], does Egg Works really want to continue to spend legal fees fighting this out after suffering two battle defeats – even after having essentially won the war at the end of the day? We shall see.

[Full Disclosure: My law firm has represented one of the Defendants in other legal matters, but did not represent any of the Defendants in this case.]

Caesars Palace Files Declaratory Judgment Action Over OCTAVIUS TOWER

noreply@blogger.com (Ryan Gile) — Thu, 14 Apr 2011 14:30:00 +0000

In so many trademark lawsuit stories that grab the media’s attention, the story is often one of a large corporation enforcing its trademark rights against individuals and small businesses in a manner that is often described as “trademark bullying” (but which, of course, from the corporation’s perspective could be seen as zealous protection of the company’s valuable trademark rights). The story behind this lawsuit is quite the opposite – in this case, it is the large corporation that is being bullied (or more accurately, majorly inconvenienced since a large corporation has sufficient resources to fight a legal battle in court) by an individual that is seeking to enforce highly questionable trademark rights.

On April 8, 2011, Caesars World, Inc. (“Caesars”), the owner of the CAESARS PALACE brand of hotel-casinos (including Caesars Palace in Las Vegas), filed a declaratory judgment action against a German man named Marcel July and his Nevada limited liability company, Octavius Tower LLC, based on the defendants claims to have exclusive ownership rights to the mark OCTAVIUS TOWER and demands that Caesars stop using the name in connection with a hotel tower. See Caesars World, Inc. v. July et al, Case No. 11-cv-00536 (D. Nev. April 8, 2011). A copy of the complaint (with exhibits) can be downloaded here.

Back in 2007, Caesars World’s parent company, Harrah’s Entertainment, Inc. (which has since been renamed Caesars Entertainment Corporation) announced a $1 billion expansion of the Caesars Palace Hotel-Casino in Las Vegas. One of the new hotel towers built as part of the expansion was going to be named the “Octavius Tower” (going along with Caesars “Roman” themed hotel/casino – presumably named after Julius Caesar’s adopted nephew, Gaius Octavius [for you Roman history scholars, feel free to correct me]).

The Octavius Tower at Caesars Palace in Las Vegas

Two days after Caesars’ announcement regarding its plans to build Octavius Tower, Mr. July, being the enterprising fellow that he appears to be, decided to registered several domain names such as octaviustowercom; octaviustowers.com; octaviustowerlasvegas.com; and octaviustowerslasvegas.com. The same day, July also registered the domain namescaesarstower.com; caesarstowers.com; caesarspalacetower.com; caesarspalacetowers.com; and caesarspalacetowerslasvegas.com. The websites at those domain names promoted that “The new Caesars Palace Towers are Coming Soon” and that the domain names were for sale (see Exhibit B of the Complaint). Caesars filed domain name arbitration actions against July under the UDRP with respect to those domain names that incorporated the mark Caesars Palace (but chose not to go after the Octavius Tower domain names without any trademark registration). The domain names were transferred to Caesars after the arbitrator determined that the domain names had been registered in bad faith. See Caesars World, Inc. v Marcel July Ra Christian Kaldenhoff, Nat'l Arb. Forum, FA 0801001126341 (March 3, 2008).

On July 20, 2007, Caesars filed its own intent-to-use application for the mark OCTAVIUS TOWER for “hotel services.” The application was allowed by the PTO on January 29, 2008; however, because of well-publicized construction delays due to lack of funding after the major downturn in the economy (see news articles here and here), Caesars was not able to provide a Statement of Use before the January 29, 2011 deadline and the application went abandoned (although Caesars, anticipating that its original application would go abandon, filed a new application on December 10, 2010).

Of course, what happened during the interim? Mr. July filed his own trademark registration applications with the PTO for the mark Octavius Tower in connection with entertainment services – specifically on May 7, 2008, July filed for the mark OCTAVIUS TOWER for “Entertainment services, namely, providing a web site featuring musical performances, musical videos, related film clips and photographs”. A registration was issued September 1, 2009. [Query—given that Caesars was already aware of Mr. July propensity for opportunism as illustrated by his domain name registrations and the fact that the marks were identical, why didn’t Caesar file an Opposition against Mr. July’s applications when it had the chance?] On July 23, 2009, July filed a second application for OCTAVIUS TOWER for “Entertainment in the nature of visual and audio performances, and musical, variety, news and comedy shows; Presentation of live show performances; Theatrical and musical floor shows provided at discotheques and nightclubs; Theatrical and musical floor shows provided at performance venues.” A registration for this second application issued on January 12, 2010. In addition to these federal registrations, July also filed three Nevada state trademark registrations for the mark OCTAVIUS TOWER in connection with entertainment services (here, here, and here) as well as a Florida trademark registration. Caesars alleges in its complaint that July has not used the mark in connection with any of the entertainment services identified in the registration (while I have not reviewed the specimens of use submitted by July in order to get his marks registered, I would not be surprised if they are questionable on their face).

Given that the PTO allowed Mr. July’s applications to register despite Caesars pending application for OCTAVIUS TOWER for hotel services, one would naturally not expect Caesars second application for OCTAVIUS TOWER to encounter any objections from the PTO, right? Wrong. On February 24, 2011, the PTO issued a non-final office action rejecting Caesars new application on the basis of a likelihood of confusion with Mr. July’s registration. So what did Mr. July do once he learned of the rejection? He got an attorney to send a cease and desist letter to Caesars (see Exhibit D of the Complaint) demanding that Caesars stop using Mr. July’s “trademarked name” Octavius Tower in any manner and threatening to pursue “all legal remedies available to him.” Caesars counsel wrote back on March 21, 2011, arguing no likelihood of confusion and offering to enter into a coexistence agreement. On March 23, 2011, July’s attorney later wrote back rejecting the coexistence agreement and reiterating the threat to take legal action. Subsequently, July purportedly modified his website at http://www.octaviustower.com/ to add a page that includes Caesars' 2007 announcement of its plan to launch Octavius Tower and includes copies of the correspondence July’s counsel sent to Caesars along with the message to the public about Caesars “infringement” of July’s trademark rights:

Public awareness of this unacceptable corporate behavior is crucial to eradicating it and we are asking you to take a stand and make a difference on this issue. Your collective voice is more compelling than the lobbying power of corporate giants and it is a voice that cannot be ignored. Together we can make a difference and help keep our freedom intact, for us, for our children, and for our grandchildren.

Caesars, recognizing its opportunity to file a declaratory judgment action against Mr. July in order to redress this mess, filed the instant action. In addition to seeking declarations of non-infringement of Mr. July’s trademark rights, Caesars also seeks to cancel July’s federal and state trademark registrations on the basis of non-use and fraud.

So with all of Mr. July’s talk about enforcing his trademark rights, we shall see how important those marks truly are to him and how strongly he feels about his trademark rights (and the strenghth of such rights). Too many individuals seem to have this impression that registration of a particular mark is the end-all-be-all for solidifying exclusive rights to a particular term. But registration is merely prima facie evidence of trademark rights. If you don't actually have any underlying trademark rights to a mark (i.e., some associated goodwill that the consuming public associates with your mark and thegoods/serivces sold using the mark), then you will not be entitled to make a claim of exclusive rights to a term (especially against a third party using the mark in connection with a substantially differnet good or service).

And while I suspect that Mr. July may try to turn this dispute into a "David vs. Goliath" battle (as reflected by his website) of a large corporation using its corporate power and the legal system to steal his valuable trademark, this is one time where I side with the big company.

My Sentiments Exactly. . . .

noreply@blogger.com (Ryan Gile) — Fri, 18 Mar 2011 13:44:00 +0000

The title of this blog post by Ron Coleman on his Likelihood of Confusion® blog says it all (along with a snazzy new blog layout).

And let this be a reminder to all of us to review those blogrolls on occasion to see which ones remain active and which ones have long since given up the grind that is blogging (and in doing so, I hope that you will consider this blog as an “active” one despite the infrequency of blog posts as of late).

Casey’s Challenges Subway's Trademark Claim to FOOTLONG

noreply@blogger.com (Ryan Gile) — Fri, 18 Feb 2011 18:02:00 +0000

As has been reported widespread in the media, last week, Casey's General Stores, Inc. (“Casey’s”), the owner of the convenience store chain Casey's General Store, filed a declaratory judgment action in Iowa federal district court against Doctor’s Associates, Inc. (“Subway”), the owner of the sandwich shop franchise Subway, seeking a declaration that the term “FOOTLONG” is generic when used in connection with a “footlong submarine sandwich” and thus Casey’s use of the term does not violate any trademark rights owned by Subway. See Casey's General Stores, Inc. v. Doctor's Associates Inc., Case No. 11-cv-00064 (S.D. Iowa February 11, 2011).

DuetsBlog provides a good blog post on the lawsuit filing (including a link to the complaint here). Other news coverage here, here, and here. Other blog coverage from Lawyers and Settlements and Trademarks and Brands.

Casey’s receipt of a cease and desist letter from Subway on January 31, 2011, regarding Subway’s claim over the FOOTLONG term apparently prompted Casey’s to file the action. In the complaint, Casey’s notes that in another pending lawsuit by Subway against convenience store chain Sheetz Inc. (see Doctor's Associates Inc. v. Sheetz Inc. et al, Case No. 09-cv-00088 (E.D. Va.)), the Court denied Subway’s early motion for a preliminary injunction and in doing so made the comment that the term “footlong” is “certainly generic.”

The complaint also notes that with respect to at least one of Subway’s applications for FOOTLONG (for restaurant services), the PTO has refused registration on the grounds that the mark is merely descriptive. In the PTO’s most recent Office Action (which included over 700 pages of exhibits), not only does the PTO note that the term “footlong” is commonly used, not only as an adjective to describe the size of sandwiches but also as a noun generically to refer to the sandwich itself and stating “Being potentially generic for applicant’s menu item, the mark FOOTLONG is highly descriptive for applicant’s restaurant services.” The PTO also noted numerous other restaurant menus, restaurant webpages, recipes, and articles using the term “footlong” to describe sandwiches and hot dogs that are one foot long and concluding that “Clearly, the evidence shows that the mark is and has been widely used descriptively, if not generically, in the food and restaurant industries for many years.”

Of course, as noted by DuetsBlog, the real question is how did Subway ever get its other FOOTLONG application (for sandwiches) to the publication phase? Numerous oppositions have been filed by companies including Long John Silvers, A&W, Taco Bell, Kentucky Fried Chicken, Dairy Queen, and Pizza Hut – with all but one suspended. The opposition that appears to be moving along is (not so coincidentally) the opposition filed by Sheetz. See Sheetz of Delaware, Inc. v. Doctor’s Associates, Inc., Opposition No. 91192657 (T.T.A.B.)

As for how the FOOTLONG application for "sandwiches" ever got the past the examination phase to the publication phase, not even the prosecution history provides a clear answer on that. In response to a descriptiveness refusal by the PTO, Subway merely argued “When applying the mark FOOTLONG to sandwiches it would require imagination, thought or perception to reach a conclusion as to the nature of those goods or services.” Subway added some sales figures in its Office Action response in order to make a claim for acquired distinctiveness if needed – but it never became an issue because the PTO, after dealing with the refusal discussed below, simply moved the application along to the publication phase.

Interestingly, it was not a descriptiveness refusal, but rather a likelihood of confusion refusal, that was Subway’s primary obstacle towards publication of its FOOTLONG application. In the PTO's office action, the Examining Attorney also cited the registered marks FOOTLONG EXPRESS (here and here) in support of a likelihood of confusion rejection. Subway was only able to get its application approved after winning by default cancellation actions against the marks FOOTLONG EXPRESS. See Doctor’s Associates, Inc. v. Skyline Chili, Inc., Cancellation No. 92050678 (T.T.A.B.).

But even after the cited marks had been canceled, the Examining Attorney still received a 72 page Letter of Protest on July 24, 2009 (which would have only been forwarded to the Examining Attorney if the PTO felt that the information raised important issues for the Examining Attorney to consider). While there is a notation in the file that the evidence was reviewed, the application was still forwarded for publication (and the approval itself would have certainly undergone the usual supervisory review, so the approval cannot be blamed on a single Examining Attorney). The rest is history (in the making). One suspects that the PTO, recognzing its mistake to have approved for publication the "sandwiches" application, went above and beyond in order to support its refusal of the "restaurant services" application.

Is there anybody out there that honestly believes that Subway is going to win this on any level?

Of course, this whole blog post was really just to give me an excuse to mention what I am reminded of when I hear the term “footlong” – a scene from the 80s Tom Hanks comedy “Bachelor Party” involving a male stripper who goes by the name “Nick the Dick.” If you watch this clip (sorry in advance for the 30 sec ad at the beginning) from the movie, at about the 1:30 mark, the lady asks “Is that footlong?” to which the gentleman replies “…and then some.” [A little bit of nostalgia for you Gen-Xers out there. . . in addition to being evidence that consumers recognize the term as a generic reference to the “size” of a “sandwich” (or at least a hot dog anyway).]

Internal Business Dispute Over “The Cupcakery” Trademark Reignites

noreply@blogger.com (Ryan Gile) — Tue, 18 Jan 2011 00:01:00 +0000

The Cupcakery is a specialty bakery specializing in baking and selling gourmet cupcakes with locations in Las Vegas and Texas.

On January 14, 2011, Texas resident Ricky Perritt (along with several of his wholly-owned LLCs) filed a lawsuit in the U.S. District Court for the Eastern Distirct of Texas against his niece, Pamela Jenkins, and her Nevada-based company The Cupcakery, LLC (“Cupcakery NV”). See Perritt et al v. The Cupcakery, LLC, et al, Case No. 11-cv-00023 (E.D. Tex. January 14, 2011). A copy of the complaint (with exhibits) can be downloaded here.

The new lawsuit is actually a continuation of an earlier dispute over ownership of “The Cupcakery” that originally arose between Perritt and Jenkins back in September 2009, but which was resolved at that time by a written settlement agreement (attached to the complaint as Exhibit A).

According to the complaint, Cupcakery NV was originally formed by three individuals – Pamela Jenkins, Laura Santo Pietro, and Dawn Kalman – in July 2005 with each owning 1/3 of Cupcakery NV. Jenkins, in order to contribute capital to the new business, purportedly received a $95,000 loan from her uncle, Perrit. Jenkins later sought to borrow additional money from Perritt in order to allow Jenkins to buy-out the interests in Pietro and Kalman. Perritt agreed to pay the funds but only if Jenkins assigned over the 2/3 combined interests of Pietro and Kalman to Perritt. Perritt and Jenkins entered into an Agreement on April 20, 2007, which assigned over Pietro’s and Kalman’s 2/3 interests in Cupcakery NV to Perritt.

When Jenkins later proposed opening a second store in Las Vegas, Perritt loaned an additional $187,500 to Cupcakery NV. That stored opened in January 2008. Thereafter, Perritt, with the full knowledge of Jenkins, decided to open up his own “The Cupcakery” stores – first in Frisco, Texas (owned by the Texas based, and co-Plaintiff ,The Cupcakery, LLC), and then a second store in Dallas, Texas (owned by co-Plaintiff Buster Baking, LLC), and later a third store in The Woodlands, Texas (owned by co-Plaintiff The Woodlands Baking, LLC). Perritt’s Texas stores used the same name, recipes and other intellectual property used by Cupcakery NV.

In September 2009, Perritt and Jenkins became embroiled in a dispute over ownership of “The Cupcakery,” which led to Perritt filing a lawsuit against Jenkins in Texas. Jenkins never answered the suit, but through counsel, a settlement agreement was reached in late October 2009 whereby Perritt transferred of his interests in Cupcakery NV to Jenkins in return for receiving an undivided 50% interest in all trademarks, tradenames, and intellectual property owned by the Jenkins and Cupcakery NV with respect to the cupcake business. Jenkins also gave up any interests she might in the Perritt-owned LLCs. Perritt also had the exclusive right for four years to develop additional “Cupcakery” stores in all states except Nevada. The settlement agreement also established that, with respect to the website thecupcakery.com, all inquiries outside of Nevada would go to Perritt and all inquiries inside of Nevada would go to Jenkins.

The end result of the settlement agreement was that Jenkins received 100% of the stores in Nevada and Perritt received 100% of the stores in Texas (along with the exclusive right for four years to develop additional “Cupcakery” stores in all states except Nevada). Perritt and Jenkins individually would own an undivided 50% interest in all THE CUPCAKERY trademarks, tradenames and intellectual property and both agreed to conduct business in a manner consisting with protecting the marks and to work together to maintain the website for The Cupcakery.

According to the latest complaint, Jenkins has become dissatisfied with the settlement agreement and has acted in a manner in breach of the settlement agreement. Specifically, Perritt alleges that Jenkins has supposedly refused to pay her share of legal expenses advanced by Perritt (approx. $8000) that were incurred by the business in pursuing a lawsuit against a third party regarding the “Cupcakery” name (perhaps referring to the “Sift: A Cupcakery” dispute previously blogged about here and here and here?). Perritt also claims that Perkins has stated that she will “not pay any monies or take any measures necessary” to protect the intellectual property and “will give the right to use the name to third parties without consideration of any sort” [ed.—probably a little bit of an exaggeration].

The complaint also alleges that Jenkins, claiming ownership and control over the website “TheCupcakery.com,” told Perritt on January 12, 2011, that she is going to pull down the website on January 17, 2011, and that Perritt must create his own website. Perritt’s position is that he owns a 50% undivided interest in all the intellectual property of “The Cupcakery” including the website and that to switch websites from the one website that gets the most hits when “Cupcakery” is entered on any search engine would cause substantial and irreparable harm to his business. Perritt also maintains that since website inquiries outside the State of Nevada are directed to him, he will be unable to communicate with potential investors, franchisees, or licensees if the website is down for any length of time.

Perritt seeks a temporary restraining order enjoining Jenkins from changing or interfering with the current website pending a hearing on Perritt’s motion for preliminary injunction. Perritt also seeks a declaratory judgment that he owns an undivided 50% interest in the intellectual property of The Cupcakery, that Jenkins is obligated to pay 50% of the attorneys fees and costs associated with protecting The Cupcakery’s intellectual property rights, and that Jenkins cannot modify the website without Perritt’s consent. Finally, Perritt sets forth causes of action for breach of contract, breach of duty of loyalty, and breach of fiduciary duty.

Comment: One wonders if the parties genuinely thought that the co-ownership of the “The Cupcakery” intellectual property rights worked out as part of their 2009 settlement agreement was really going to work in the long term.

UPDATES:

Las Vegas Sun coverage: Website at center of The Cupcakery legal dispute (Steve Green, January 18, 2011).

In a very interesting and surprising twist, on January 19, 2011, Pamela Jenkins, the public face for The Cupcakery (at least in Las Vegas) issued her own press release which seems to announce that she is no longer claiming any exclusive trademark rights to the term CUPCAKERY in connection with a cupcake bakery:

Through research, I've found that the word cupcakery existed before I opened The Cupcakery. I believe the use of cupcakery as a noun can only maximize the exposure for myself and others who believe in the delicious spirit of cupcakes and cupcakeries. It is not, and never has been, my intent to limit the use of the word cupcakery or purport to own the word, as my former partner is attempting to do. As I have received numerous requests nationwide regarding the phenomenon of cupcakes, the word cupcakery and other cupcake-related questions of late, I felt it was the right time to share the glory of The Cupcakery and all cupcakeries freely.

Las Vegas Sun coverage: Cupcakery owner hoping for an end to trademark disputes (Steve Green, January 20, 2011).

Jenkins’ statement then prompted her uncle to seek another TRO to stop her from talking, which was promptly denied (link to amended TRO application and court denial here).

Las Vegas Sun coverage: Cupcakery legal battle escalates with request for gag order (Steve Green, January 27, 2011).

Utah District Court Rejects 1-800 Contacts Google Adword Lawsuit Against Lens.com

noreply@blogger.com (Ryan Gile) — Mon, 10 Jan 2011 01:30:00 +0000

While this decision is a little old by blogging standards, since it did not receive much publicity and yet deals directly with the hot trademark issue of purchasing a competitor’s trademarks as part of Google’s Adwords program, I thought it worthwhile to give it some coverage.

Plaintiff 1-800 Contacts, Inc. (“Plaintiff”), an online seller of contact lenses, had filed suit against Defendant Lens.com, Inc. (“Defendant”), also an online seller of contact lenses, for trademark infringement arising from the purchase by Defendant (or marketing affiliates of Defendant) of Plaintiff’s trademarks as keywords to generate sponsored links to Defendant’s website.

Both parties filed motions for summary judgment and on December 14, 2010, the U.S. District Court for the District of Utah, in a lengthy but detailed decision (including providing great detailed background information regarding Google’s Adword program), granted Plaintiff’s motion for summary judgment on Defendant’s defense that purchase of a keyword is not a use in commerce, but also found that Defendant was entitled to summary judgment on all of Plaintiff’s claims. See 1-800 Contacts, Inc. v. Lens.com, Inc., Case No. 2:07-cv-591, 2010 U.S. Dist. LEXIS 132389 (D. Utah December 14, 2010). A copy of the decision can be found here (Justia.com).

After setting forth the respective trademark rights of the parties and providing a detailed discussion of Google’s Adword program (recommended reading for any trademark attorneys with clients out there upset about competitors purchasing their trademarks as keywords for sponsored links), the court noted that while Defendant had purchased numerous keywords that consisted of variations and misspellings of Plaintiff’s service mark, none were Plaintiff’s actual service mark and Plaintiff had failed to present any evidence showing that Defendant ever purchased Plaintiff’s exact service mark as a keyword.

The court noted, however, that some of Defendant’s marketing affiliates had purchased Plaintiff’s exact service mark as a keyword (the court’s decision also provides a detailed discussion regarding the use by online sellers of marketing affiliates). Defendant has a relationship with the affiliate network Commission Junction, which included the marketing of Defendant’s website JustLenses.com.

Plaintiff presented evidence showing two of Defendant’s affiliates as having purchased Plaintiff’s service mark as a keyword. The first affiliate purchased variations of Plaintiff’s trademark as keywords which resulted in the following “impressions” (i.e., the appearance of an advertiser’s link after a user conducts an internet search), the language of which were drafted by the affiliates’ own employees:
1. Buy Contacts Online
Simple online ordering of lenses.
Compare our prices and save!
http://www.justlenses.com/
2. 1-800 Contacts
Simple online ordering of lenses.
Compare our prices and save!
http://www.justlenses.com/
3. 1800 Contacts: Buy Online
Simple online ordering of lenses.
Compare our prices and save!
http://www.justlenses.com/

The second affiliate’s keyword purchases resulted in the following impressions
LensWorld.com 75% Off
Up to 75% off Retail Price!
Free Shipping on Orders Over $89
http://www.lensworld.com/
JustLenses.com Savings
Up to 70% off Retail Price. Name
Brand Contacts & Low Prices.
http://www.justlenses.com/

In 2005, Plaintiff, having done some routine searches to see what competitor impressions appear when doing a internet search for Plaintiff’s trademarks, contacted Defendant about sponsored advertisements for Defendant’s website being triggered by searches of Plaintiff’s trademarks. After Defendant discovered that the ads were coming from Defendant’s marketing affiliates, Defendant agreed to work with Plaintiff’s counsel, who provided Defendant with a list of twenty terms that Plaintiff asked Defendant and its affiliates to implement “negative matching” for such terms (i.e., to ensure that no ad is generated when a particular term is searched). Plaintiff again contacted Defendant in April 2007 about impressions being generated from searches of Plaintiff’s trademarks. After receiving no satisfaction, Plaintiff filed suit in August 2007. In October 2007, Commission Junction put Defendant in touch with one of the affiliates, who was informed by Defendant to implement certain negative keywords such as “1-800-Contacts.” Defendant ultimately was able to get Commission Junction to identify and communicate to the affiliates who were generating the offending impressions (the two mentioned above) to cease bidding on certain keywords, which they did immediately.

The court first analyzed the “use in commerce” issue – and quickly sided with those courts who have concluded that use of another’s mark to trigger internet advertisements for itself is a use in commerce:

The Lanham Act does not require use and display of another’s mark for it to constitute “use in commerce.” Rather, “use in commerce” occurs when a mark is “used or displayed in the sale or advertising of services and the services are rendered in commerce.”120 Here, Plaintiff’s service mark was used to trigger a sponsored link for purposes of advertising and selling the services of Defendant. In other words, Plaintiff’s mark was used to promote Defendant’s services and to provide a consumer with a link to a website where it could make a purchase from Defendant. The court concludes such actions constitute a “use in commerce” under the Lanham Act.

The court then turned to the issue of likelihood of confusion. Plaintiff attempted to argue that the appearance of Defendant’s advertisements whenever a user does a search for “1800Contacts,” amounts to a “bait and switch that “spawns confusion,” – “akin to a consumer asking a pharmacist for Advil and the pharmacist handing the consumer Tylenol.” However, the court quickly shot down Plaintiff’s faulty analogy:

This analogy mischaracterizes how search engines function. A more correct analogy is that when a consumer asks a pharmacist for Advil, the pharmacist directs the consumer to an aisle where the consumer is presented with any number of different pain relievers, including Tylenol. If a consumer truly wants Advil, he or she will not be confused by the fact that a bottle of Tylenol is on a shelf next to Advil because of their different appearances.
This analogy is supported by case law. In J.G. Wentworth, a court questioned the Brookfield decision because of its “material mischaracterization of the operation of internet search engines.” “At no point are potential consumers ‘taken by a search engine’ to defendant’s website due to defendant’s use of plaintiff’s marks in meta tages.” Instead, “a link to defendant’s website appears on the search results page as one of many choices for the potential consumer to investigate.” When the link does not incorporate a competitor’s mark “in any way discernable to internet users and potential customers,” there is “no opportunity to confuse defendant’s services, goods, advertisements, links or websites for those of” its competitor.

The court then goes on to explain the problem with companies like Plaintiff who focus too much on the “use” of their marks alone rather than focusing on use that is likely to cause consumer confusion:

Plaintiff monitors use of its mark by others on the Internet. It does so by entering its mark or a variation of it as a search term. If a competitor’s advertisement appears on the search-results page, it sends a cease and desist letter to the competitor to preclude the competitor’s advertisement from appearing on the same page as Plaintiff.
Notably, however, ninety-five percent of the impressions for Plaintiff are triggered by non-trademarked keywords such as contacts, contacts lenses, or by brand names such as Acuvue or Focus. When a company incorporates broad matching for terms such as “contacts or contact lenses,” its sponsored link will appear even if the search term is “1800Contacts.” In other words, simply because the search term is “1800Contacts,” does not mean the keyword generating the sponsored link also was 1800Contacts or a similar variation thereof. One cannot tell from a screen shot alone what keyword generated the sponsored link.
The end result, though, is that when a consumer enters “1800Contacts” as a search term, it will see a competitor’s advertisement anytime the competitor bids on “1800Contacts” “contacts” or “contact lenses” as a broad match. If the advertisement remains the same regardless of which search term triggers it, there is no more likelihood of confusion for the advertisement triggered by the trademark versus the advertisement triggered by the generic phrases. Nor is there any greater impact on the goodwill or reputation of the trademark holder. It is beyond dispute that a competitor cannot be held liable for purchasing a generic keyword to trigger an advertisement that does not incorporate a holder’s mark in any way, even if that competitor’s advertisement appeared when a consumer entered a trademarked search term. Given that fact, it would be anomalous to hold a competitor liable simply because it purchased a trademarked keyword when the advertisement generated by the keyword is the exact same from a consumer’s perspective as one generated by a generic keyword. Imposing liability under such circumstances would elevate “use” over consumer confusion.
As stated above, Plaintiff sends cease and desist letters anytime a competitor’s advertisement appears when Plaintiff’s mark is entered as a search term. Were Plaintiff actually able to preclude competitor advertisements from appearing on a search-results page anytime its mark is entered as a search term, it would result in an anti-competitive, monopolistic protection, to which it is not entitled. Because a consumer cannot see a keyword, nor tell what keyword generated an advertisement, the court concludes that the mere purchase of a trademark as a keyword cannot alone result in consumer confusion. Accordingly, the relevant inquiry here regarding consumer confusion is not just what keyword was purchased, but what was the language of the advertisement generated by that keyword.

(emphasis added).

With that, the court turned to the two types of impressions at issue – ones that did use Plaintiff’s mark and ones that did not. Regarding the ones that did not use Plaintiff’s mark or a similar variation in the advertisement, the court noted that the closest case was one ad that generated “1-800 -Discount Contacts” in the title. But the court found that the composite view of the advertisements were overwhelmingly dissimilar in both sight and sound. The only similarity was the use of “contact” or “contacts” which is unlikely to create consumer confusion because of the numerous sellers of contact lenses. This strongly weighed in favor of no confusion. Regarding the advertisements that did use Plaintiff’s mark, the court focused on the advertisements generated by Defendant’s affiliates (noted above) that expressly used “1800 Contacts” in the title. The court found this was use of Plaintiff’s mark and weighed in favor of a finding of likelihood of confusion.

Regarding the “intent to copy” factor, while the court acknowledged that Defendant’s own purchase of variant keywords could lead one to conclude that it was done to derive benefit from Plaintiff’s reputation or goodwill by generating an advertisement for Defendant, the court accepted Defendant’s evidence that any such benefit was a de minimus part of its business:

Defendant purchased over 8,000 keywords, of which only nine are complained about by Plaintiff. Those nine keywords generated about 1,600 impressions out of more than 112 million impressions that have been linked to Defendant between the years 2004 and 2008. This, too, demonstrates that Defendant was not targeting its marketing efforts to ride on Plaintiff’s reputation or goodwill. While all doubts must be construed against Defendant, there is insufficient evidence to create a doubt about Defendant’s actions. The court therefore concludes this factor is, at most, neutral with respect to Defendant.

But the factor favored Plaintiff with respect to the ads by the marketing affiliates who had directly used Plaintiff’s mark in their ads.

Plaintiff had presented no evidence of actual confusion, so this factor favored Defendant. As for similar marketing channels, the court made the observation that, focusing just on internet, both parties advertise through sponsored links and the fact that both links appear on the same search page would dispel rather than cause confusion because the websites are separate and distinct, suggesting two completely unrelated business entities [ed.—interesting way of looking at it]. Nonetheless, the court found sufficient similarity to have this factor weigh somewhat in favor of Plaintiff. The court also found that it was unlikely that consumers exercise a high degree of care in selecting contact lens providers, so this factor favored Plaintiff.

Finally, in analyzing the strength of Plaintiff’s mark, the court found the mark to be conceptually weak – putting together the two generic terms “Contacts” (“The strength of Plaintiff’s mark on the Internet is weakened by the very nature of how third parties use generic and descriptive words on search engines.”) and “1-800” (“others necessarily must use similar generic and descriptive phrases to market their product on-line or through a toll free number”). As for the commercial strength of Plaintiff’s mark, the court found several flaws in the survey evidence provided by Plaintiff to demonstrate the commercial strength of its mark (including not focusing just on Internet, the fact that it was not a double-blind survey, and the fact that the results were somewhat marginal). The court noted that while Plaintiff had shown about 2.5 million impressions were generated on the Internet specifically matching the keyword “1800Contacts” or a close variation over a six year period, it still only represented about 2.5% of the Plaintiff’s total internet impressions. The court concluded that the conceptual and commercial strength combined indicated that Plaintiff’s mark was only moderately strong. And because Defendant’s own sponsored ads did not include Plaintiff’s mark or a similar variation of it, then, given the moderate strength of Plaintiff’s mark, the court found there was little possibility that a consumer would confuse Defendant with Plaintiff. However, with respect to the advertisement by the marketing affiliates with did use Plaintiff’s mark in the advertisement, the court found that such use, given the moderate strength of Plaintiff’s mark, would likely confuse a consumer about the source of the affiliate’s advertisement.

Taking all of the factors together, the court concluded that there was insufficient evidence for a jury to conclude that Defendant infringed on Plaintiff’s mark for all advertisements that did not use Plaintiff’s mark in them, and accordingly, granted summary judgment in favor of Defendant on that issue. In contrast, the court found there was a likelihood of confusion for the marketing affiliate advertisements that did use Plaintiff’s mark. However, because the affiliates were not named as parties to the lawsuit, the court then turned to the issues of whether the affiliate’s action could be imputed to Defendant under a theory of contributory infringement or vicarious infringement.

The court rejected any vicarious liability on the basis of any lack of an agency relationship between Defendant and the affiliates with the infringing impressions. Plaintiff attempted to impute liability for its very participation in the affiliate marketing program whereby affiliates could purchase keywords. However, because it was the language of the impressions, and not the purchase of keywords themselves, that created a likelihood of confusion, it is only as to those impressions that Defendant could be vicariously liable. In this case, Defendant had little direct contact with affiliates (and had to work through Commission Junction). Defendant had no authority to monitor or supervise affiliate operations except with respect to the use by such affiliates of Defendant’s own marks. Defendant also was not in a position to exercise any degree of control over an affiliate’s website.

As for a theory of contributory infringement, the court found that Plaintiff had not presented any evidence that Defendant intentionally induced the affiliates to infringe on Plaintiff’s mark: “At most, Plaintiff has presented evidence that Defendant did not institute negative keywords and that it knew of some of the keywords that a few affiliates were using in their advertising efforts. As discussed above, however, trademark liability cannot attach from the mere use of a trademark as a keyword. Thus, none of the evidence presented by Plaintiff demonstrates that Defendant intentionally induced its affiliates to infringe on Plaintiff’s mark.”

Moreover, Plaintiff failed to show that Defendant knew about the specific impressions noted above generated by Defendant’s marketing affiliates and failed to take action or was willfully blind to such infringement. Specifically, in the screenshots that were attached to Plaintiff’s April 2007 correspondence, none of them demonstrated the impressions found by the court to be infringing – and instead, were of the non-infringing advertisements that the two marketing affiliates had generated. “Thus, in April 2007, Plaintiff did nothing more than provide general information to Defendant that a non-infringing advertisement was appearing upon entry of certain search terms. Defendant therefore cannot be charged with knowledge or willful blindness based on that information. Nor did the information impose a burden on Defendant to go search out all of its affiliates’ actions to make sure none of them were using Plaintiff’s mark.”

The court also noted that when Plaintiff included one of the infringing impressions it is August 2007 complaint, the screenshot by itself did not provide Defendant with sufficient information for it to determine immediately who the affiliate was (among Defendant’s 10,000 affiliates). “Because contributory trademark infringement does not require a defendant ‘to refuse to provide a product or service to those who merely might infringe the trademark,’ Lens.com had no obligation to cease licensing its name to all of its affiliates while it took steps to identify the one who generated this particular impression.”

The court found that “there is insufficient evidence to show that Defendant failed to take appropriate action to stop McCoy from publishing the advertisements. There is no indication that Defendant intended to benefit from the Infringing Impressions, nor is there evidence of how many Infringing Impressions and clicks occurred during the relevant time period. Accordingly, the court concludes that Defendant cannot be held liable for contributory infringement.”

The remainder of the court’s decision involves Plaintiff’s claim for breach of contract (for which the court found no enforceable agreement on the part of Defendant to not purchase Plaintiff’s mark or variations thereof as a keyword), Plaintiff’s claim for unfair practices under state law (claims not supported by Plaintiff in its opposition), Plaintiff’s claim for common law trademark infringement and unfair competition (rejected for the same reasons as Plaintiff’s Lanham claims), and Plaintiff’s claim for unjust enrichment (since Plaintiff has not shown that use of its service mark as a keyword constituted infringement, then it is not entitled to any payment for such use – “Stated differently, while the law protects one’s property right in a trademark, the scope of that protection is not without its limits. Use outside of the scope of that property protection is not a use that is unjust to retain without payment. Indeed, if Plaintiff were able to obtain payment under unjust enrichment, common law would effectively expand the scope of Plaintiff’s statutory protection. Because one generally cannot extend legal rights beyond one’s property rights, the court grants summary judgment in Defendant’s favor on this claim.”).

In the end, the court gave the Plaintiff one small victory in granting summary judgment on Defendant’s defense that the purchase of keywords did not constitute a “use” in commerce; however, it was certainly overshadowed by the overwhelming victory given to Defendant by the court granting summary judgment in favor of Defendant and dismissing all of Plaintiff’s claims against Defendant.

Home Depot Seeking to Stop Other “Depots” (But Not For the Reason You Think)

noreply@blogger.com (Ryan Gile) — Thu, 09 Dec 2010 16:09:00 +0000

Last Friday, the companies behind the nationwide hardware store chain The Home Depot (and the chains’ intellectual property assets) – Home Depot U.S.A., Inc. and Homer TLC, Inc. (together “Home Depot”) – filed two lawsuits last week (one in California and one in Florida) against companies operating under names which incorporate the terms The and Depot.

In the case filed in California, Home Depot sued Nimasara Industries, Inc. which purportedly does business under the name The Box Depot. See Home Depot U.S.A., Inc. and Homer TLC, Inc. v. Nimasara Industries, Inc. d/b/a The Box Depot, Case No. 10-cv-09300 (C.D. Cal. December 3, 2010) (complaint here). In the case filed in Florida, Home Depot sued a company doing business as The Beer Depot. See Home Depot U.S.A., Inc. and Homer TLC, Inc. v. The Beer Depot, Case No. 10-cv-24299 (S.D. Fla. December 3, 2010) (complaint here).

At first glance, these appear like cases where Home Depot is attempting to protect its “Depot” brand from being diluted from third party use of the same “depot” moniker in connection with some other product or service (reminds me of the slew of non-toy related businesses that adopted the “R Us” business moniker after Toys R Us made it so famous in connection with toy stores).

Of course, if this was the case, a quick look at the list of trademarks currently registered with the U.S. Patent and Trademark Office that follow the same “The ____ Depot” pattern is quite extensive and raises questions about Home Depot’s ability to claim that names which incorporate the terms “The” and “Depot” are likely to be associated with Home Depot when a term other than “Home” is used in between.

Most notably, Nimasara Industries, the company sued by Home Depot, is the assignee of a trademark registration for THE BOX DEPOT (registered in 2003). In addition, here are several other registered marks for various goods/services:

THE DRILLING DEPOT
THE CONDO DEPOT
THE SPICE DEPOT
THE VITAMIN DEPOT
THE TOOL DEPOT (interestingly, Home Depot did oppose this particular application for hardware retails stores services initially when it was published for opposition, but was apparently willing to dismiss the opposition when the applicant amended the trademark to remove the “The” – even though the registered mark still includes a design with the word “The” in it)
THE APPRAISAL DEPOT
THE HOSPITALITY DEPOT
THE HAMMER DEPOT
THE BBQ DEPOT
THE SPA DEPOT
THE COFFEE DEPOT
THE HOMO DEPOT (my personal favorite name among the bunch – owner’s website here)
THE DUMPSTER DEPOT
THE FLOOR DEPOT
THE FAUCET DEPOT
THE CLEANING DEPOT
THE PLANE DEPOT
THE SNACK DEPOT

However, upon closer review of the details of each complaint, it becomes clearer that that the real basis of Home Depot’s trademark infringement claims is not so much about the terms “THE” and “DEPOT” per se, but rather the use of such words in a stylized lettering that resembles the blocked stenciled-style lettering used by Home Depot in its logo and/or the use of such words in connection with an orange color scheme that Home Depot claims infringes on its trade dress rights.

Home Depot describes these trade dress rights in one of its complaints as a “distinctive orange color scheme . . . used in and on its stores and in connection with the use of THE HOME DEPOT and THE HOME DEPOT & Design marks. This distinctive Orange Trade Dress includes the use of orange signage, stripes, lettering, and labels throughout its stores and on its building exteriors, as well as in its promotional materials.” Indeed, Home Depot even has a trademark registration for the “color orange” in connection with many goods and services described specifically as “The mark consists of the color orange used as a background for advertising, promotional materials, signage, and labels.”

In the Beer Depot complaint, the crux of the dispute appears to be that Beer Depot is displaying the name THE BEER DEPOT “in blocked stenciled-style lettering utilizing an orange color scheme, the natural effect of which is to make Defendant's usage of 'The Beer Depot' name and trade dress as close as possible to Homer TLC's famous Marks and imitate Homer TLC's Orange Trade Dress, evidencing an intent to trade on Homer TLC's goodwill by creating consumer confusion.” While I was unable to find the Google advertising referenced in the complaints (and chose not to download the exhibits), there was one photograph (link here) taken by Derick Glancy and posted on his Flickr page that shows what likely concerns Home Depot. Beer Depot has never responded to Home Depot’s cease and desist letters.

In the Box Depot complaint, once again, Home Depot’s complaint appears to be the use of a logo similar to Home Depot’s logo and the use of other “orange trade dress.” Specifically, Home Depot claims that Box Depot is operating “its business in a building with an orange stripe around the upper exterior perimeter. Defendant's name, both on Defendant's building and in Defendant's ‘The Box Depot’ logo, is displayed in blocked stenciled-style lettering utilizing an orange color scheme. The natural effect of these elements in combination is to make Defendant's usage of its ‘The Box Depot’ name, mark and dress as close as possible to Homer TLC's famous Marks and imitate Homer TLC's Orange Trade Dress, evidencing an intent to trade on Homer TLC's goodwill by creating consumer confusion.” The PDF of the complaint does contain the exhibits showing the alleged infringement, but as they are in black and white (and not very clear scans), one cannot really tell about the use of orange coloring although the use of blocked stenciled-style lettering is apparent – and it is a style that Box Depot had not previously adopted in its registered logo (pictured below). Indeed, the very fact that Home Depot is not seeking to cancel Nimasara’s current registration in its complaint shows that Home Depot is more concerned about Nimasara’s use of “The” and “Depot” in connection with an orange color scheme, rather than the words themselves.

[Hmm...did you ever have one of those blog posts that you get started on, spend way too much time on, and then you aren't sure how exactly to wrap it up eloquently? Did I mention The Homo Depot?!]

Hard Rock Hotel Fires Back Against Hard Rock Café Trademark Lawsuit. . .and Reveals the True Story Behind the Dispute

noreply@blogger.com (Ryan Gile) — Wed, 17 Nov 2010 01:55:00 +0000

I previously blogged (link here) about the trademark infringement lawsuit filed by Hard Rock Café against the Hard Rock Hotel.

Last Friday, the Hard Rock Hotel fired back with its own counterclaims against Hard Rock Care for breach of contract and tortious interference with business relations arising from Hard Rock Café’s alleged interference with Hard Rock Hotel’s sublicensing activities. A copy of the Hard Rock Hotel’s Answer and Counterclaims can be downloaded here (HT: Steve Green). The Las Vegas Sun has an article on the court filing here.

When the lawsuit was filed back in September, it had all of the tell-tale signs of “something else is going on here.” It seemed pretty obvious (at least to me) that the Hard Rock Café was using some slight “breaches” to try to gain some kind of business advantage. Now, with the Hard Rock Hotel’s Answer, it becomes a little clearer what this dispute is really about – and no surprise, it’s about money.

The true nature of this dispute is revealed in the Hard Rock Hotel’s Preliminary Statement which states the following:

The Hard Rock Defendants have done nothing wrong and, in fact, are victims of systematic legal and business harassment by the Café, which today’s countersuit seeks to remedy. The Hard Rock Defendants enjoy an exclusive, perpetual and royalty-free right to use the “Hard Rock” family of marks for hotel-casinos and casinos west of the Mississippi and in certain international locations. These rights are clearly spelled out in a 1996 license agreement, which the Café is unhappy with but legally bound by. Under that license, the Hard Rock Defendants operate the popular Hard Rock Hotel and Casino Las Vegas; have developed Hard Rock Hotel-Casinos in Tulsa and Albuquerque, through tribal sublicensees; and are actively pursuing other hotel-casino and casino development opportunities in the territories where they enjoy exclusive rights. Per the license agreement, none of the revenue from these ventures goes to the Café or ever will.

The Café has brought the present lawsuit – a meritless grab bag of claims for breach of license, trademark infringement, trademark dilution and unfair competition – in an attempt to terminate or rewrite the 1996 license agreement. The Café complains about a range of alleged trademark abuses that in many cases it has long known about, tolerated or even approved. Most notably, the Café claims to be shocked and disturbed by the popular reality television show “Rehab: Party at the Hard Rock Hotel,” filmed at the Hard Rock Hotel and Casino Las Vegas – despite the fact that this show and the lively behavior it portrays have already been on the air for two years; depicts an event similar to the “Detox” party held at one of the Café’s properties; and has brought enormous positive publicity to the Hard Rock brand. Likewise, the Café purports to be upset about the Tulsa and Albuquerque ventures despite having offered public praise about both ventures. The meritless and untimely nature of the Café’s allegations confirms that this lawsuit is nothing more than an attempt to escape the disadvantageous 1996 license agreement.

Frustrated at being contractually excluded from a lucrative business in a large territory, the Café, in addition to filing the Complaint, has also resorted to improper business tactics. The Café has actively pursued its own projects in the Hard Rock Defendants’ exclusive territories in direct violation of the letter and spirit of the license agreement. The Cafe has interfered with the Hard Rock Defendants’ development projects, including by making untrue and overreaching public statements to deter potential partners from doing business with the Hard Rock Defendants. This misconduct by the Café violates the license agreement and the law, and it must stop.

Of course, Hard Rock Café would say that this is just the Hard Rock Hotel's spin on the dispute. But looking at the situation impartially, what makes more sense? That the Hard Rock Café feels that the Hard Rock Hotel and the “Rehab” show is harming the “rock and roll image” of the Hard Rock trademark so badly that it filed this action – or that Hard Rock Café is looking for a way to rescind the Hard Rock Hotel's license (and sublicense) agreement so that it can have the entire bundle of trademark rights to itself?

The latest Facebook trademark dispute - Lamebook

noreply@blogger.com (Ryan Gile) — Fri, 05 Nov 2010 14:40:00 +0000

Facebook’s aggressive trademark enforcement efforts against any third party use of trademarks using “–book” (or “face-“) have been well documented in the media (most recently, Teachbook) (articles here, here, and here among many). A review of the Trademark Trial and Appeal Board filings by Facebook also documents the number of trademark applications involving the word “book” or “face” that Facebook has opposed.

Yesterday, the website Lamebook, which prides itself on finding and reposting amusing pictures and status updates (along with “other gems”) found on social networking websites like Facebook and Twitter, decided to be proactive and filed a declaratory judgment action in the face of a cease and desist letter from Facebook seeking a declaration of non-infringement and non-dilution. See Lamebook, LLC v. Facebook, Inc., Case No. 10-cv-00833 (W.D. Tex. November 4, 2010). Techcrunch reports on the lawsuit (and provides a copy of the complaint).

Lamebook’s position is that its use of the mark Lamebook is protectable parody. So naturally, Facebook’s position will be that its mark is famous (not an unreasonable position) and that this mark causes a likelihood of dilution (ask Louis Vuitton about the viability of this position). Of course, as described in this prior blog post regarding a different parody mark, the online nature of the services offered by both Facebook and Lamebook may make the case more suitable for a traditional likelihood of confusion analysis.

Don’t Believe Everything You Read

noreply@blogger.com (Ryan Gile) — Fri, 29 Oct 2010 16:45:00 +0000

Just because a court of law issues an order making findings of fact and conclusions of law does not mean that those facts and conclusions reflect the real truth. It only reflects a decision by the court based on the evidence and arguments presented to the court. Thus, a court decision may reflect the truth or may simply reflect the only factual conclusion that the court could reach based on the incomplete picture presented to it by the parties.

Such is the case with the cybersquatting and trademark infringement lawsuit brought by New York-New York Hotel & Casino, LLC (“NY-NY”), the company which owns the New York New York Hotel & Casino in Las Vegas (pictured above), against California resident Ronnie Katzin and his wholly-owned corporation, NewYorkNewYork.com, Inc., over the domain name newyorknewyork.com (the “Domain Name”). See New York-New York Hotel & Casino, LLC v. Katzin et al, Case No.09-cv-02139 (D. Nev.). On October 28, 2010, the Nevada district court issued an order (link here) granting NY-NY’s Motion for Summary Judgment against Defendant Defendant Katzin and finding as a matter of law that Katzin was liable for cybersquatting and trademark infringement with respect to his use of the Domain Name.

But as mentioned in the title above, don’t believe everything you read. For reasons detailed in my previous blog post regarding this case (link here), I believe the court’s decision is wrong. But as this case demonstrates, it’s often not enough that the defendant be in the right – a defendant has to be able to present factual evidence and make effective arguments to the court supporting its position that it is right in the face of accusations (however baseless) to the contrary by another party. And when you have to hire attorneys to help you do this in court, establishing that you are in the right suddenly becomes an expensive proposition.

In this case, Katzin, apparently not in a financial position to hire an attorney to fight NY-NY’s highly questionable allegations, decided to fight NY-NY pro se. But like many pro se litigants, he didn’t have the legal background and experience to put together factual evidence arguments in a way that would have been receptive to the court (and of course, with respect to NewYorkNewYork.com, Inc., because only lawyers can represent corporate entities in federal court and Katzin is not a lawyer, he was prohibited from filing any papers on behalf of his corporation).

The only positive thing about this order is that the court, recognizing the circumstances of the case, exercised its discretion and only awarded NY-NY $1,000 in statutory damages (the minimum amount of statutory damages for cybersquatting) – along with another “nominal” award of $1,000 for “corrective advertising” [ed.—correcting what?]. This is probably the best the court could do under the circumstances to send the message that while the court may have found Katzin liable for cybersquatting (and trademark infringement), he is not really a cybersquatter and did not really cause any significant harm to NY-NY’s precious trademarks.

The court’s awarding of $1,000 in statutory damages is a far more reasonable determination than the court’s previous awarding of the maximum statutory damages of $100,000 against NewYorkNewYork.com, Inc., as part of the default judgment entered by the court after no attorney made an appearance on behalf of the corporation to answer NY-NY’s allegations (and Katzin’s Answer filed on behalf of the corporation was struck since, as previously mentioned, Katzin is not a lawyer who could file an Answer on behalf of a corporate entity).

Having previously granted a default judgment against Defendant NewYorkNewYork.com, Inc., which resulted in the transfer to NY-NY of what NY-NY was really after in the first – the extremely valuable domain name newyorknewyork.com, the court’s decision (assuming no appeals are filed) effectively brings this example of injustice to an end.

Mélange of Trademark Stories

noreply@blogger.com (Ryan Gile) — Fri, 15 Oct 2010 19:01:00 +0000

The Cupcakery Lawsuit Settles
Gourmet cupcake bakery The Cupcakery quietly settled its lawsuit (previous blog posts here and here) against former employee Andrea Ballus and her cupcake bakery Sift: A Cupcakery. See The Cupcakery, LLC v. Ballus et al, Case No. 09-cv-00807 (D. Nev.). Click here for the Court’s Order dismissing the case.

While no terms were disclosed, it would appear that part of the dismissal involved Ballus withdrawing her earlier filed trademark application for Sift: A Cupcakery that was blocking Cupcakery’s four applications to register THE CUPCAKERY – two for the word mark THE CUPCAKERY (for retail and online retail services and cakes and cupcakes) and two for the THE CUPCAKERY logo (for retail and online retail services and cakes and cupcakes).

On September 28, 2010, Ballus’ attorney filed an express withdrawal of her application with the Trademark Trial and Appeal Board in the pending Opposition that was filed by Cupcakery when her application was published for opposition. See The Cupcakery, LLC v. Sift: A Cupcakery LLC, Opposition No. 91188833 (T.T.A.B.). So that leaves Cupcakery’s applications next in line to claim exclusive rights to use the term “Cupcakery” in connection with a cupcake bakery. It’s only a matter of time before Cupcakery’s applications will be removed from suspension and examined on the merits.

And it looks like Cupcakery has already started working towards getting other “cupcakeries” to stop using the term “Cupcakery.” One company that had previously been using the term The Cupcakery now seems to be calling itself THE CUP.

USPTO Requesting Comments on Trademark Bullies
The PTO issued a Request for Comments regarding Trademark Litigation Tactics as part of its preparation of a study which the Secretary of Commerce must conduct to explore “(1) the extent to which small businesses may be harmed by litigation tactics by corporations attempting to enforce trademark rights beyond a reasonable interpretation of the scope of the rights granted to the trademark owner; and (2) the best use of Federal Government services to protect trademarks and prevent counterfeiting.” See prior blog post here regarding the enacted legislation (The Trademark Technical and Conforming Amendment Act of 2010, Pub. L. No. 111-146, 124 Stat. 66 (effective March 17, 2010) which brought about this interest in trademark bullies.

Blogger Erik Pelton is looking to organize attorneys and businesses who want to sign on to a collective statement to the PTO. Deadline for submitting comments is January 7, 2011, and can be emailed to TMFeedback@uspto.gov with the subject line “Small Business Study.”

THE GAP Logo Fiasco
Another example of the maxim “If it ain’t broke, don’t fix it.” BBC Article on Gap’s disastrous decision to change its famous stylized word mark to something that looks like it was created in about 2 minutes using a simple word processor font and unimpressive graphic – and stories of other logo redesigns. Pittsburgh Trademark Lawyer Daniel Corbett blogged on the fiasco here.

Never Ending Trademark Lawsuits
Darden Concepts, owner of the Olive Garden and Red Lobster chain of restaurants and two trademark registrations for NEVER ENDING PASTA BOWL (here and here), sued owner of TGI Fridays for marketing a menu item of “Never Ending Shrimp” (Darden also registered the mark ENDLESS SHRIMP in connection with its Red Lobster restaurants). See Darden Concepts, Inc. et al v. Briad Restaurant Group, L.L.C. et al, Case No. 10-cv-02077 (S.D. Cal. October 6, 2010). Complaint here (via courthousenews). News article on the suit here.

This is not the first time Darden has asserted its rights to the phrase “Never Ending” in connection with food offerings. Just ask IHOP, which was sued by Darden in 2004 over its use of “Never Ending Pancakes” (news article here; cancellation action here). That suit was eventually settled – and you probably have not seen IHOP offering any “Never Ending Pancakes” since.

Incontestable does not Invulnerable
Pamela Chestek reminds us all that having an incontestable trademark registration does not make it an invulnerable trademark registration, especially when the incontestable ownership of the mark may have come about from an improper assignment – as the owners of the STOLICHNAYA trademark for vodka were recently informed of by the Second Circuit Court of Appeals. See Federal Treasury Enter. Sojuzplodoimport v Spirits Int'l N.V., No. 06-3532 (2nd Cir. Oct. 8, 2010).