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Copyright Information
TENTH ANNIVERSARY ISSUE
September/October 2017 Volume 10 • Number 1
A Publication of the ABA Section of Intellectual Property Law
evolution
In This Issue:
• IP in the US Court of Federal Claims
• Patenting the Output of Creative Computers
• Sound Marks as Sonic Indicators of Source
Continuing to Evolve
A
s we begin our tenth anniversary
year, Landslide magazine keeps
putting an eye on our industry
and practice. While intellectual property
evolves, so do we by bringing our read-
ers the most current issues and highest
quality content in fresh ways.
This lagship publication, a beneit of

Section membership, is dedicated to
covering and analyzing the subjects in
all areas of IP law and to presenting con-
tent that informs, educates, and provides
solutions for best practice. We continue
to address the changing IP world.
Our premier issue began with “Virtual

Worlds,” a hot topic then that has dra-
matically expanded in this decade. In
that issue, Tom Goldstein wrote about
how the US Supreme Court pressed the
Federal Circuit to consider the question
of obviousness more lexibly and more
cost-effectively. In our irst issue, we con-
sidered the results of the TEACH Act for its effects on long-distance learning, and we
presented the question “Traditional Contours of Copyright: Silver Lining or Storm Clouds?”
Look how much has changed since then.
We are proud that Landslide magazine has reached such high recognition in the IP com-
munity and beyond. This publication will keep challenging readers as we watch and
analyze all the developments in the IP industry and practice, in all branches of govern-
ment, and in the courts.
It is itting that this anniversary issue presents growth and changing perspectives: looking
at the history of the US Court of Federal Claims, addressing the effect of the fall of Form
18, and presenting a thought-provoking argument for computer inventorship.
On behalf of our Editorial Board, I am proud to greet you as Landslide magazine’s ifth
editor-in-chief. We pledge to continue to provide you with superior content—and, always,
a great read.
—David J. Dawsey
Published in Landslide® magazine, Volume 10, Number 1 , a publication of the ABA Section of Intellectual Property Law (ABA-IPL), ©2017 by the American Bar Association. Reproduced with permission. All rights reserved. This
information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.
Perspective
By Scott F. Partridge
Evolutionary Tales:Times of the Best and Worst
It was the best of times, it was the worst the protestations that would follow in proceedings, face a potentially narrow
of times, it was the age of wisdom, it was putting the future of the patent system estoppel risk (if Shaw and its progeny are
the age of foolishness, it was the epoch of ahead of the politics of the times? The rightly decided), and make the risk of an
belief, it was the epoch of incredulity . . . . ABA-IPL Section spent two years tack- eventual defeat in a patent infringement
—Charles Dickens, A Tale of Two Cities ling the challenges in putting together case substantially less in the United States
a balanced proposal that we think puts than in China and Europe today. IPRs
W
e live in interesting and the future of the patent system irst (see are the worst of times, though, for irst-
challenging times: in Highlights of the 2016-17 Association to-market patent holders of all stripes. Is
politics, business, religion, Year, p. 6). the America Invents Act system as imple-
international affairs, and surely in intel- What about patent venue? Need mented by the US Patent and Trademark
lectual property (IP) law. we say any more than “TC Heart- Ofice wisdom or foolishness? One might
And so it is in our own times, as in land”? That case is the best of times wonder if we have entered an “epoch of
those of Dickens and other eras, that we for frequent, unhappy defendants in incredulity,” while another would contend
see dramatic twists and turns, even in IP the Eastern District of Texas. But it that this is the age of wisdom.
law. Perhaps never in the history of the certainly is the worst of times for non- In patent law, laches, exhaustion,
IP law system has its role been subject practicing entities—and not just for Octane Fitness, willfulness, eBay,
to more attention and scrutiny every- those who have been characterized potential legislation telling courts how
where—by the Supreme Court, Congress, with the pejorative patent troll moni- to manage their cases, and other issues
users of the system, alleged abusers, and ker. Will our system now require most in patent evolution pose more best and
the public at large. Even the long view patent suits to be brought on the home worst of times scenarios.
that IP law substantially contributes to our turf of those who are alleged to be tort- But patent law is not alone. If you’re
nation’s economy as a driver of invest- feasors—patent infringers? And is that a trademark lawyer, how concerned are
ment in innovation is increasingly subject wisdom or foolishness? In an amicus you that the Slants and Washington Red-
to challenge in some circles. Depending brief that our Section prepared for the skins cases, and the invocation of First
on your perspective on the many pend- American Bar Association (ABA), our Amendment law, will further impact the
ing issues in IP law, this may be your own Section took no position on the wisdom previously well-understood application
best of times or worst of times. of the concentration of patent cases in of basic principles of trademark law?
Let’s test that beginning with pat- the Eastern District of Texas, but we Has the introduction of political correct-
ent eligibility. If you are a high tech did take a position that was consistent ness in trademark law been a function of
company whose products rely on com- with the outcome in the US Supreme wisdom or foolishness? And what about
puter methods or a diagnostic laboratory Court, simply because as a matter of trademark damages: to what extent
where diagnostic testing methods use proper statutory construction Congress should plaintiffs be entitled to lost prof-
laws of nature often discovered by oth- had said so (see p.8). We think we sided its, and to what extent should defendants
ers, these may be the best of times when with the rule of law. be able to limit damages to actual dam-
considering how the courts now apply Then we entered the era of inter par- ages? Best of times or worst of times?
Supreme Court precedent on patent eli- tes reviews (IPRs). The IPR system is To be sure, copyright law is part of this
gibility found in Mayo and Alice. But, the best of times for alleged tortfeasors best and worst drama. Will we have a Reg-
if you are a start-up, joint venture, uni- accused of patent infringement. They can ister who can operate independently of the
versity researcher, life science innovator, avoid a jury and a clear and convincing Library of Congress? Will the Copyright
or owner of a large portfolio of patents standard in district court, potentially run Ofice be autonomous? Will it end up in
whose intangible value was considered up costs in a parallel proceeding (or even the executive branch, and what lies ahead
substantial prior to Mayo and Alice, a series of parallel proceedings brought if that happens? Will the Copyright Ofice
these are truly the worst of times. We by multiple defendants), stay district court Continued on page 68
may wonder, then, is this the age of wis-
dom or foolishness in patent eligibility, Scott F. Partridge is chair of the ABA Section of Intellectual Property Law. He is a partner
and to the extent patent law requires ix- at Baker Botts LLP in Houston, Texas. He specializes in patent, trade secret, and licensing
ing, is anyone—the courts, Congress, litigation and client counseling in all areas of intellectual property law. He can be reached at
the executive branch—willing to suffer scott.partridge@bakerbotts.com.
Published in Landslide® magazine, Volume 10, Number 1, a publication of the ABA Section of Intellectual Property Law (ABA-IPL), ©2017 by the American Bar Association. Reproduced with permission. All rights reserved.
This information or any portion thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar
Association.
®
Volume 10 • Number 1 • September/October 2017
Columns 16 Patenting the Output of Autonomously

1 Perspective Inventive Machines
This article analyzes the phenomenon of machines that autonomously engage
Evolutionary Tales: Times in inventive activity and argues that recognizing computer inventorship would
of the Best and Worst promote innovation and fairness.
By Scott F. Partridge By Ryan B. Abott
Departments 23 Form 18, I Just Don’t Know

5 ABA-IPL Section Focus What I Want: How the
Highlights of the 2016-17 Abrogation of Form 18 Has
Association Year Changed Pleading Standards
By Amy Mandel The authors provide a survey of the
varied direct infringement pleading
standards that have developed since
12 Proiles in IP Law the fall of Form 18.
Master Class: By Jeffrey T. Castellano and
Paul Brown,UL Nathan R. Hoeschen
By Janet A. Marvel
59 Meeting of the Minds

Righting Inventorship
Wrongs—A
Multijurisdictional
Overview
By Todd M. Martin and Pervin
Taleyarkhan Pg. 16
65 Decisions in Brief
By John C. Gatz
40 The Hidden Persuader: Sound Marks
as Sonic Indicators of Source
Sonic branding affords brand owners with the opportunity
to reach passive consumers, drive value, and connect
with consumers on a deeper level. This article explores
registrability issues commonly encountered when prosecuting
sound trademarks.
By Anna L. King and Luke S. Curran
44 Toward a Social Networking Law?

(2017 Edition)
The author provides a 2017 update to his 2009 Landslide
article on developments in social media law.
Pg. 44 By Hillel I. Parness
48 Jointly Waging the Battle against

Counterfeiters in Asia
Here is a blueprint for how competing brand owners can work
together to effectively combat illegal trademark counterfeiting.
27 One Crack and an “Evisceration”: By Wayne Mack

The Current State of the DMCA’s
Safe Harbor 54 The New Trademark Opposition
While the bedrock of DMCA protection for ISPs System in Mexico
remains strong, cracks are beginning to form as a
Through a series of amendments to the Industrial Property
result of the natural evolution of ISPs and the tendency
Law published last year, Mexico created a formal trademark
of some to push the limits of acceptable behavior
opposition system. While the new system is far from perfect, it
proscribed by §512(c). This article examines recent case
is an important step forward.
law and the potential erosion of these protections.
By Louis T. Perry and Katie A. Feiereisel By John M. Murphy
30 Intellectual Property Suits in the

United States Court of Federal
Claims
This article serves as a primer on patent and copyright
infringement litigation before the United States Court
of Federal Claims. It focuses on the practicalities of
suing the federal government and provides guidance for
government contractors who regularly supply goods and
perform services that potentially infringe patents and
copyrights of third parties.
By Judge Mary Ellen Coster Williams
and Diane E. Ghrist
Pg. 48
Editorial Policy: Landslide® magazine provides articles on contemporary issues in intellectual property law for practicing attorneys and others interested in the subject
matter. The materials contained herein represent the opinions of the authors and should not be construed to be those of either the American Bar Association, the
magazine Editorial Board, or the ABA Section of Intellectual Property Law (ABA-IPL) unless adopted pursuant to the bylaws of the Association. Nothing contained
herein is to be considered as the rendering of legal advice for speciic cases, and readers are responsible for obtaining such advice from their own legal counsel. These
materials and any forms and agreements herein are intended for educational and informational purposes only. Landslide magazine advertisers are responsible for the
content of their ads as printed. The ABA, ABA-IPL, and the Magazine Editorial Board are not responsible for the accuracy of ad content.
Published in Landslide® magazine, Volume 10, Number 1, a publication of the ABA Section of Intellectual Property Law (ABA-IPL), ©2017 by the American Bar Association. Reproduced with permission. All rights reserved. This
Editor-in-Chief Editorial and Creative Director Michael A.Stramiello
David J. Dawsey Amy Mandel Paul Hastings LLP
Gallagher & Dawsey Co., L.P.A. ABA Section of
ddawsey@invention-protection.com Intellectual Property Law Pervin Taleyarkhan
amy.mandel@americanbar.org Whirlpool Corporation
Deputy Editor-in-Chief
Adrienne R. Fields Managing Editor Ida Wahlquist-Ortiz
Artists Rights Society Erin Johnson Remotigue
aields@arsny.com ABA Publishing Sharmian L. White
erin.remotigue@americanbar.org The Curry Law Firm, PLLC
Intake Editor
Janet A. Marvel Art Director Francesca M. Witzburg
Pattishall, McAuliffe, Newbury, Anthony Nuccio Dentons US LLP
Hilliard & Geraldson LLP ABA Creative Group
Review Editors
Acquisitions Editor Editors Copyrights
Susan Pan Lindsay Allen Sophie Cohen
Sughrue Mion PLLC Perkins Coie LLP LifeLock, Inc.
Immediate Past Editor-in-Chief Jeffrey A. Andrews Patents
Darrell G. Mottley Sutton McAughan Deaver, PLLC Kevin R. Greenleaf
Banner & Witcoff, Ltd. Adam S. Baldridge Dentons US LLP
Baker, Donelson, Bearman,
Caldwell & Berkowitz, PC Trademarks
Rebeccah Gan
Rick Biagi Wenderoth, Lind & Ponack, LLP
Neal & McDevitt, LLC
Krystle Brown Decisions in Brief Editor
John C. Gatz
Shane Delsman Nixon Peabody LLP
Godfrey & Kahn, SC
Matthew Hintz Webinar Coordinator
Lowenstein Sandler LLP Paul LaVanway
Fredrikson & Byron, P.A.
Abioye Mosheim
US Copyright Ofice
International Coordinator
Janice Phaik Lin Goh Rupert Knights
Cover: iStockPhoto
Arent Fox LLP Dollymore

Shannon N. Proctor
US District & Bankruptcy Courts for Diversity Coordinator
the District of Columbia Darlene Tzou
Smith, Gambrell & Russell, LLP
Chrissie Scelsi
Wargaming America, Inc.
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ABA-IPL SECTION FOCUS
Highlights of the 2016–17 Association Year
By Amy Mandel
From its strength within the American Bar Association, the ABA Section of Intellectual
Property Law (ABA-IPL) advances the development and improvement of intellectual
property laws and their fair and just administration. The Section furthers the goals of
its members by sharing knowledge and balanced insight on the full spectrum of intel-
lectual property law and practice, including patents, trademarks, copyright, industrial
design, literary and artistic works, scientiic works, and innovation. Providing a forum
for rich perspectives and reasoned commentary, ABA-IPL serves as the voice of intel-
lectual property law within the profession, before policy makers, and with the public.
Advocacy
Throughout the year, the Section works on behalf of its mem- eligibility statute to ensure useful inventions are protected;
bers and the profession in identifying, watching, and analyzing revise Patent Trial and Appeal Board (PTAB) proceedings
key issues and to bring attention to intellectual property issues to apply the plain meaning claim constructions as applied in
before Congress, the executive branch, and the judiciary. district courts; and prohibit diversion of US Patent and Trade-
mark Ofice (USPTO) user fees to other agencies within the
This year, ABA-IPL’s comments included those conveyed on Department of Commerce.
a variety of IP matters: to government ofices, to the presi-
dential transition team, and in conjunction with our ABA
colleagues on matters both domestically and internationally. TRADEMARKS
Comments of the ABA Section of Intellectual Random Trademark Audits
Property Law to the Presidential Transition Team
on Issues Relating to the United States Intellectual August 18, 2016
Property System The Section wrote to the USPTO to provide written
comments on the “Changes in Requirements for Afidavits or
December 21, 2016 Declarations of Use, Continued Use, or Excusable Nonuse
The Section sent a letter to the presidential transition team not- in Trademark Cases.” The Section supported the USPTO
ing that protecting the industries that drive our economy is an goal of promoting the integrity of the trademark register
essential role of our federal government. The ABA-IPL Sec- by encouraging accuracy in the listing of goods/services
tion’s comments were submitted to aid the transition team for which use or continued use of a mark is claimed and
in identifying areas where our federal protections need to be acknowledged that the proposed rules would facilitate the
buttressed against the persistent threat of theft. The Section more streamlined and effective processes.
pointed out that intellectual property laws provide the incentive
needed to promote aggressive private investment in the devel- Comments to the USPTO on
opment of new life-saving medicines and medical devices, new Reformatted Trademark Declarations
communications technologies, and so much more.
October 24, 2016
The letter emphasized that as the United States struggles to The Section continued its support for the goal of promoting
maintain its position as the economic and technological world the integrity of the Trademark Register by reformatting the
leader, our intellectual property system provides the protec- veriied statements made in connection with applications,
tions necessary to keep inventors and creators from falling allegations of use, and post-registration afidavits, to separate
victim to theft both from within and beyond the borders of out the clauses to improve readability and to require the
our nation. The ABA-IPL Section noted that it has taken on signatory to check a box next to each statement in order to
issues important to the health of our IP system, and therefore validate an electronic submission. The Section made speciic
the United States economy, and it included a list of 13 rec- suggestions to improve the accuracy and functionality
ommendations that the federal government should undertake of the system and suggested that mere reformatting
to strengthen the intellectual property system. ABA-IPL’s of the declaration may not be suficient for signiicant
recommendations included the need to: revise the patent improvements that would achieve the USPTO’s goal.
Informal Comments on Proposals comments to clarify and highlight a few important issues that
to Improve the Accuracy of the United it recommended for clariication.
States Trademark Register
October 24, 2016 PATENTS

The ABA-IPL Section conveyed support for the USPTO’s
goal of assessing and promoting the accuracy and integrity Patent Subject Matter Eligibility
of the Trademark Register through the use of expungement The ABA-IPL Section wrote to the USPTO early in 2017 to
mechanisms to expunge unused goods and services from respond to its invitation for comments on patent subject matter
trademark registrations and generally supported its proposed eligibility. The Section noted that current patent eligibility juris-
expungement mechanisms. The Section noted that consideration prudence of the courts is in conlict with existing ABA policy and
of different types of expungement and nonuse proceedings and that the Section believed that the current state of the common-law
mechanisms could potentially be implemented without statutory interpretation of 35 U.S.C. § 101 has reached the point where fur-
changes and stated that the mechanisms are valuable tools for ther judicial interpretation is unlikely to rectify the ambiguities and
eficiently removing unused registrations from the Register. uncertainties created by the current jurisprudence. While continu-
ing to be of the view that laws of nature, natural phenomena, and
Adoption of CAPTCHA for abstract ideas standing alone are not proper subject matter for pat-
TESS and Sign-In for TEAS ent protection, the Section stressed that legislation clarifying the
distinct role for § 101 in limiting patent eligibility to practical uses
October 24, 2016 of processes, machines, manufactures, and compositions of matter
ABA-IPL wrote a letter to the USPTO in response to an informal would likely be necessary. The Section noted that it was in the pro-
e-mail request dated August 26, 2016, for comments about the cess of developing policy that would facilitate a revision of § 101
USPTO’s possible adoption of: (1) a CAPTCHA veriication that clariies what is and what is not patent eligible.
device on the Trademark Electronic Search System (TESS)
search engine, and (2) a user sign-in requirement for electronic In the spring, the Section provided more speciic comments to
forms via the Trademark Electronic Application System (TEAS). the USPTO with an update on its progress to develop a suit-
The Section supported the USPTO’s apparent goal of reducing able legislative proposal. It outlined the legislative proposal
the burdens on its website arising from unqualiied open access, passed by Section Council that recognizes the proper role
and in doing so, improving the speed and eficiency of those of preemption in establishing a patent eligibility gateway
systems for applicants and practitioners among other members consistent with the fundamental concerns of the Supreme
of the public. The Section suggested that only the least intrusive Court—while leaving determinations of patentability, spe-
variety of CAPTCHA device should be adopted and that the ciically, to “novelty,” “obviousness,” and “speciication,”
USPTO should consider appropriate alternative access channels namely 35 U.S.C. §§ 102, 103, and 112. The Section’s pro-
in view of the public nature of the TESS system. posal directly applies the long-standing fundamental concerns
of Supreme Court precedent, is consistent with current ABA
Proposed Rulemaking Regarding policy, and makes clear that “patent eligibility shall not be
Revival of Abandoned Applications negated when a practical application of a law of nature, natu-
ral phenomenon, or abstract idea is the subject matter of the
December 20, 2016 claims when all limitations with none ignored are fully con-
In responding to the request by the USPTO, the Section sidered.” The ABA-IPL proposal “substantially mitigates, if
expressed support for the USPTO’s stated goal of promoting the not resolves, newly injected ambiguity and confusion into the
integrity of the information in the trademark electronic records eligibility determination caused by the use of factors that are
system as an accurate relection of the status of applications relevant only to novelty, obviousness, and the requirements of
and registrations; ensuring that the public has notice of the particularity in claiming an invention.” The policy also out-
deadlines and requirements for petitions to revive an abandoned lines speciic conditions for patent-eligible subject matter.
application, petitions to the director regarding other matters, The Section’s work is a “irst step towards a politically palat-
and requests for reinstatement of abandoned applications and able solution to the unworkable detrimental state of current
canceled or expired registrations; as well as facilitating the 101 jurisprudence.”
eficient and consistent processing of such requests. The Section
recommended that several areas warrant clariication. Comments to the Canadian Patented Medicine Prices
Review Board on Modernization of the Patented
Draft Examination Guide on Medicines Pricing Guidelines
Incapable Informational Matter
October 24, 2016
March 16, 2017 As a key IP stakeholder, the Section expressed its interest
The Section sent a letter to US Commissioner for Trademarks in the global pricing of patented medicines. In addition to
expressing support for the proposed examination guide offering comments addressed to several speciic areas, the
on incapable informational matter. The Section provided Section stated that it believes that categorizing new patented
medicines based on the degree of therapeutic beneit is budget and suficient authority to develop its own IT system
rational and that it would be reasonable to reassess the pricing to support the unique needs of its users, to provide the Ofice
for patented medicines periodically to ensure that the pricing with autonomy from the Library of Congress, and to make
is consistent with the marketplace. the Register of Copyrights position Senate-conirmed. Not-
ing the abrupt removal of the Register of Copyrights by the
Patent Fees new Librarian, the Section called on Congress for renewed
oversight and Ofice autonomy. The letter highlighted the
December 22, 2016 need to select a Register who, among other things, is a law-
The ABA-IPL Section expressed its support for the USPTO goal yer with substantial experience and expertise in copyright law
of balancing the need to collect suficient revenue with its goal and suficient knowledge to represent U.S. copyright inter-
of promoting high-quality examination and reasonably prompt ests domestically and abroad. Regarding proposed Copyright
disposition of patent applications at a reasonable cost to the public. Ofice Advisory Committees, the Section recommended com-
Among its comments, the Section favored setting patent-related fees prising those committees with copyright practitioners, but to
at a level appropriate to cover reasonable costs, that such fees remain also make clear the committees would not advise the Ofice
with the USPTO, and that fee increases should be substantiated. The on substantive issues. Finally, the Section expressed its sup-
Section noted that fee diversion is again a signiicant threat to the port for legislation that would establish a copyright small
patent system. It encouraged the USPTO “to consider smaller fee claims tribunal within the Copyright Ofice.
increases at this time to more closely satisfy the necessary recovery
of aggregate estimated costs and reduce the risk that user fees will Proposed Update to the Federal Trade Commission
be applied to pay for the activities of other government entities or and US Justice Department Antitrust Guidelines for
otherwise fund the government generally. the Licensing of Intellectual Property
September 26, 2016

COPYRIGHT The Section of Intellectual Property Law joined with the
Section of Antitrust Law in applauding the agencies’ efforts
Revising Section 108: Copyright Exceptions for to maintain the relevance of the IP Licensing Guidelines
Libraries and Archives through the proposed update, noting that the Guidelines
have largely withstood the test of time and that the agencies’
August 29, 2016 approach to evaluating the competitive impact of licensing
The Section wrote to the US Copyright Ofice in August last arrangements has not fundamentally changed since 1995
year on its view regarding Revising Section 108: Copyright when the Guidelines were issued. The Sections were both
Exceptions Notice of Inquiry, 81 Fed. Reg. 36,594 (June 7, of the view that the proposed revisions do not anticipate
2016) (Dkt. No. 2016-4). The comments generally applauded changes in evaluation, but are intended to more accurately
the report’s consensus-based recommendations. In departing relect developments in relevant antitrust and intellectual
from the report’s recommendations, the Section expressed property law and that the proposed update will assist market
that continuing changes in technology and preservation participants to better understand their obligations under the
practices make it important for the Copyright Ofice to receive antitrust laws in a number of areas. The comments included
suficient rulemaking authority to adapt § 108 to changing those on reinforcement of core analytical principles and
circumstances. It noted that library and archive exceptions included suggested areas for clariication
are so out of date as to risk being meaningless, increasingly
resulting in some libraries and archives relying on the fair use INTERNATIONAL
doctrine to permit greater use of their resources. The Section
stated its support for granting the Copyright Ofice greater Joint Comments with Antitrust, International Law
rulemaking authority to identify exceptions to copyright Sections to China on Anti-Unfair Competition Law Draft
infringement for qualifying institutions and offered several
recommendations for modiications to approaches that would March 24, 2017
improve the system and prohibit infringement. The Section of Intellectual Property Law cosponsored with the
Sections of Antitrust Law and International Law comments
Letter from the Section to the House Judiciary to the Standing Committee of the National People’s Congress
Committee Chair and Ranking Member on the (NPCSC) of the People’s Republic of China on the Anti-Unfair
Copyright Ofice Proposal Competition Law (Revised Draft) (Draft AUCL), which was
published for public consultation. The Sections offered the
February 21, 2017 comments in the hope that they would assist the NPCSC in
The Section sent a letter to the chair and ranking member of further reining the Draft AUCL. The comments relected the
the House Judiciary Committee to provide input on the House expertise and experience of their members with both antitrust
Judiciary Committee’s proposal to reform the U.S. Copyright and unfair competition laws around the world and were a
Ofice. In its letter, the Section encouraged Congress to draft follow up to comments provided on an earlier draft of proposed
legislation to provide the Copyright Ofice with an adequate revisions to the Anti-Unfair Competition Law in 2016.
Joint Comments with Antitrust, International Law statute in VE Holding Corp. v. Johnson Gas Appliance Co., 917
Sections to China on Anti-Monopoly Guidelines on F.2d 1574 (Fed. Cir. 1990). That case interpreted the patent venue
Abuse of Intellectual Property Rights statute to allow patent infringement actions to be iled nationwide
(wherever there was personal jurisdiction over a corporate defen-
April 20, 2017 dant). TC Heartland then iled a petition for certiorari, which the
The Section of Intellectual Property Law cosponsored United States Supreme Court granted in December 2016.
with the Sections of Antitrust Law and International Law
comments to the Anti-Monopoly Commission (AMC) of The ABA-IPL Section proposed and was granted permission to
the State Council of the People’s Republic of China on the prepare an amicus brief for the ABA on behalf of the petitioner TC
Anti-Monopoly Guidelines on Abuse of Intellectual Property Heartland in the Supreme Court. The ABA’s brief urged the Court
Rights (Draft for Comments) (Draft IP Guidelines), which to conclude that the special patent venue statute limits venue for a
was published for public consultation. corporate defendant to either where the defendant resides or where
it has committed acts of infringement and has a regular and estab-
lished place of business. This would reverse the holding of the
ABA POLICY Federal Circuit. Ironically, the ABA argued, the Federal Circuit’s
broadened interpretation of the patent venue laws has led to severe
At the ABA Midyear Meeting in May, the ABA House of Del- concentration of patent litigation. Nearly half of all patent cases
egates adopted as ABA policy a proposed resolution from the are now iled in just two judicial districts, and nearly 25 percent
ABA-IPL Section that nominative fair use should be classiied are iled before one judge in the Eastern District of Texas. This
as an afirmative defense in trademark infringement cases. The has had numerous adverse effects on patent law and practice, such
resolution bears upon trademark law’s nominative fair use doc- as depriving patent law of the diversity of viewpoints necessary
trine, which protects the use of a trademark or service mark to for a healthy and robust common law. And this increase in forum
identify the mark owner’s own goods and services. shopping has undermined public conidence in the fundamental
fairness of the patent system and the courts, and risks diminishing
The resolution allows the ABA to pursue the incorporation the credibility of the bar.
of the nominative fair use doctrine into the Lanham Act’s
infringement cause of action so mark owners do not enjoy On May 22, 2017, the Supreme Court issued its decision, 137
overbroad rights to control all uses of their marks. It allows S. Ct. 1514, unanimously reversing the Federal Circuit. The
the ABA to help advance defendants’ First Amendment rights Court ruled, based on a straightforward reading of the pat-
by encouraging courts to require mark owners to demon- ent venue statute, that a corporation will only be deemed to
strate prima facie cases of infringement before imposing on “reside” where the corporation is incorporated. The Court’s
defendants the duty to prove their eligibility for the doctrine’s reasoning that the patent venue statute should not be given the
protection. With adoption of this resolution, the ABA could expansive deinition applied by the Federal Circuit was consis-
have submitted an amicus curiae brief to the US Supreme tent with the position advocated in the ABA’s amicus brief.
Court in the case of International Information Systems Secu-
rity Certiication Consortium, Inc. v. Security University, Matal v. Tam
LLC, 823 F.3d 153 (2d Cir. 2016), cert. denied, 137 S. Ct. In Matal v. Tam, a member of the Asian rock band The Slants
624 (2017), had the Court granted the petition in that case. applied to register the service mark “THE SLANTS” with
the USPTO. The Trademark Trial and Appeal Board rejected
the application to register the mark as potentially disparaging
AMICUS CURIAE of people of Asian ancestry, under section 2(a) of the federal
trademark statute (the Lanham Act), which bars registration
The ABA-IPL Section successfully recommended to the ABA of potentially disparaging marks.
Board of Governors that the American Bar Association ile amicus
briefs in two important Supreme Court cases this past year. The The issue before the Supreme Court was whether the bar on
ABA-IPL Section drafted the briefs on behalf of the ABA. registering potentially disparaging marks violated the First
Amendment free speech clause. In 2015, the Federal Cir-
TC Heartland LLC v. Kraft Foods Group Brands LLC cuit held in an en banc decision that the bar on registration
The TC Heartland case concerned the question of patent venue, “amounts to viewpoint discrimination,” which did not survive
and in particular, the Federal Circuit’s interpretation of the patent “the strict scrutiny review appropriate for government regu-
venue statute, 28 U.S.C. § 1400(b). TC Heartland, an Indiana- lation of message or viewpoint.” In re Tam, 808 F.3d 1321
based company, challenged the venue in a patent infringement (Fed. Cir. 2015) (en banc), aff’d sub nom. Matal v. Tam, 137
suit iled by Kraft Foods in the District of Delaware. TC Heart- S. Ct. 1744 (2017). The Supreme Court granted certiorari on
land’s motion to transfer the case from Delaware to Indiana was the constitutional issue in the fall of 2016.
denied, and the Federal Circuit then denied its petition for a writ
of mandamus, 821 F.3d 1338 (Fed. Cir. 2016), concluding that the The ABA’s brief, which was not in support of either party,
Delaware district court’s exercise of jurisdiction was reasonable, advised the Supreme Court not on the merits of the actual ser-
based on the Federal Circuit’s interpretation of the patent venue vice mark registration issue but rather on three basic propositions
of trademark law, namely, that: (1) the owner of a registered understand these three basic propositions to resolve the constitu-
mark enjoys certain substantive and procedural advantages in tional issue presented by the certiorari petition without distorting
litigation to protect its mark that are not available to the owners trademark law in the process.
of unregistered marks; (2) a determination that a mark is ineligi-
ble for registration with the USPTO does not necessarily render On June 19, 2017, the Supreme Court afirmed the Federal
that mark invalid and unprotectable; and (3) such a determina- Circuit’s opinion, holding the portion of the statute at issue
tion does not restrict the mark owner’s right to use the mark in unconstitutional. The opinion conirmed the three points
commerce. The Section believed it necessary for the Court to described above.
ABA-IPL Reach
Tracy-Gene Durkin, Vice Chair of the ABA-IPL Design
and Engagement Committee, represented the Section at the second annual
ID5 Industrial Design Forum in Beijing. Representatives
Section Chair Donna P. Suchy represented the ABA-IPL included those from INTA, IPO, and MARQUES, and the
Section at several national and international conferences— ive largest ofices that protect industrial designs: USPTO,
furthering relationships and working with IP colleagues. Ms. Japan Patent Ofice (JPO), Korean Intellectual Property
Suchy attended the AIPPI World Congress in Milan in Sep- Ofice (KIPO), China Intellectual Property Ofice (SIPO),
tember, the APAA Meeting in Bali in October, and the UIA and European Intellectual Property Ofice (EUIPO).
Conference in Budapest in November. This year she also
attended the AIPLA Mid-Winter Meeting in February and Past Chair Lisa Dunner and Immediate Past Chair Ted Davis rep-
INTA Annual Meeting in Barcelona in May. resented the Section at the midyear meeting of the TM5 group
in Barcelona in May. Other representatives included those from
Section Chair-Elect Scott F. Partridge represented the Sec- USPTO, JPO, KIPO, SIPO, EUIPO, INTA, AIPLA, and IPO.
tion at the AIPLA Spring Meeting in Seattle in May. Immediate Past Chair Ted Davis represented the Section
at the annual 2017 Canadian Bar Association IP Day in
ABA-IPL and the USPTO worked together to sponsor the 4th Ottawa in May.
Annual ABA-IPL Trademark Day “Behind the Scenes at
the USPTO” in September. Immediate Past Chair Ted Davis represented the Section at
the 23rd NGO Coordination Meeting in Barcelona in May.
ABA-IPL, participating with fellow IP stakeholders Other participants included representatives from ACPAA,
including INTA, IPO, and AIPLA, joined the U.S. Chamber of AIPPI, ASEAN IPA, ASIPI, ECTA, EPI, EPLAW, ICC,
Commerce’s Global Intellectual Property Center in the INTA, IPO, MARQUES, and Union-IP.
70th Anniversary Celebration of the Lanham Act.
Presents
When: October 17, 2017 Overview of Intellectual Property Suits in

1:00 PM – 2:30 PM ET
the United States Court of Federal Claims
Moderator: Lionel Lavenue,
Partner, Finnegan, Henderson, The US Court of Federal Claims is the forum for seeking monetary damages from the
Farabow, Garrett & Dunner, LLP, United States government, including in cases of alleged patent and copyright infringement.
Reston, VA With government use of intellectual property steadily increasing, the Court of Federal
Panelists:
Claims has seen a rise in both infringement actions and peripheral intellectual property
Hon. Mary Ellen Coster Williams, issues in the contract arena. This program led by Judge Mary Ellen Coster Williams, US
United States Court of Federal Court of Federal Claims, will discuss the scope of the court’s jurisdiction in intellectual
Claims, Washington, DC, property cases. In addition, panelists will explore and explain how IP litigation in this court
Diane Ghrist, Judicial Law Clerk
varies from other typical fora, including in jurisdiction, third-party practice, indemniica-
to Judge Jimmie V. Reyna, United
States Court of Appeals for the tion, and remedies.
Federal Circuit
Turn to page 30 to read “Intellectual Property Suits in the United States
To register: Call 1-800-285-2221 Court of Federal Claims” by Judge Mary Ellen Coster Williams and
or visit www.americanbar.org/iplaw. Diane E. Ghrist.
Past Section Chair Marylee Jenkins was named Chair of the of Airbnb; Professor Jane Ginsburg of the Columbia University
USPTO’s Patent Public Advisory Committee (PPAC). This School of Law; Wynn Coggins, Deputy Chief Administrative Ofi-
will be her second term with PPAC. Bernard (Bernie) J. Knight cer of the USPTO; and the Honorable Kara Fernandez Stoll of the
Jr., active Section member and former General Counsel at the US Court of Appeals for the Federal Circuit.
USPTO, was named as a new member of PPAC.
The Section continues to cosponsor the annual Judicial
Once again the Section joined with several other IP organiza- Intern Opportunity Program (JIOP) with the Section of
tions in sponsoring the annual USPTO Design Day, which Litigation. The program provides diverse students who are
this spring looked at “What’s Next for Design Patents?” traditionally underrepresented in the profession with full-
time, six-week summer internships with state or federal
ABA-IPL joined with the Colorado Bar Association to cospon- judges. This year JIOP placed 148 irst- and second-year law
sor its 34th Annual National CLE Conference in Snowmass students with 130 judges across the country: 25 judges indi-
in January and the 15th Annual Rocky Mountain IP & Tech- cated an interest in reviewing students with IP backgrounds;
nology Institute in June in Westminster, Colorado. 19 students were selected and placed with IP judges, includ-
ing some in new positions on the federal bench.
ABA-IPL continues to participate as a founding partner of the
American Intellectual Property Law Educational Founda- This was the twelfth year of the ABA-IPL Young Law-
tion (AIPLEF), whose mission is to increase the diversity of yer Fellows Program. The program selects two young
the IP bar by providing scholarships and mentoring to under- lawyers each year for three-year terms and provides them
represented minority law school students pursuing careers with funding and opportunities to develop into future lead-
in IP law. The foundation was formed in 2001 in partner- ers of the Section. New fellows selected this year are Pervin
ship with the ABA-IPL Section and the American Intellectual Taleyarkhan of the Whirlpool Corporation and Jennifer
Property Law Association (AIPLA), the Minority Corpo- McCollough of the US Department of Justice.
rate Counsel Association, and founding corporation Johnson
& Johnson. A partnership with the Thurgood Marshall Col- The ABA-IPL Section expanded its commitments toward pub-
lege Fund also was established to assist in administering the lic outreach and public service initiatives this year. Its focus
foundation’s scholarship program through publication and on education, action, and inancial commitment toward select
processing of scholarship applications and initial review of work that promotes an understanding, awareness, and appre-
the applications. AIPLEF awards the Sydney B. Williams ciation of IP law continues to bring distinction to the Section’s
scholarship to assist underrepresented minority law students volunteers. A public service project this year took place at the
entering intellectual property law. Its Jan Jancin Award is pre- Margaret Pace Park in Miami, Florida, where both Section
sented annually to an outstanding IP law student. members and staff helped collect trash from the waterfront.
The ABA-IPL Section hosts ive active afinity action groups: ABA-IPL Book Publishing continues to grow, with 50 titles
Law Student Action Group (LSAG), Young Lawyers including the debut of a treatise on Copyright Litigation
Action Group (YLAG), International Associates Action Strategies. Landslide® magazine, the Section’s high-proile
Group (IAG), Diversity Action Group (DAG), and Women lagship periodical, is entering its tenth year of publication.
in IP Law Action Group (WIP). Members of these groups
work to coordinate activities of unique demographics and fur- In the spring, ABA-IPL’s 32nd Annual Intellectual Property
ther interest and activity among their natural constituencies. Law Conference was highlighted by a wide range of compre-
hensive CLE programs as well as events and opportunities to
In its inaugural year, the Women in IP Law Action Group network with experts, colleagues, and potential clients from
(WIP) has grown to nearly 400 members. This year its meet- around the world.
ings featured a conference call series with distinguished speakers
including Kenya N. Wiley, Founder and CEO of the Fashion Inno- The 2017 Mark T. Banner Awards honored three distin-
vation Alliance; Linda A. Klein, President of the American Bar guished recipients: Judge Lucy H. Koh, Dr. Kate Darling, and
Association; Alica Del Valle, Senior IP and Marketing Counsel Don W. Martens.
Amy Mandel is director of communications & publications, ABA Section of Intellectual Property Law. She may be reached at
amy.mandel@americanbar.org.
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PAUL BROWN
Anticounterfeiting
Underwriters Laboratories
Mast
By Janet A. Marvel
Paul Brown is vice president of intellectual property (IP) market—however, many of these products were made with
and litigation at Underwriters Laboratories (UL). He man- unsafe parts, and many of them had counterfeit UL marks.
ages UL’s litigation activities and is responsible for growing, US Customs found and seized 52,000 hoverboards from more
maintaining, and protecting UL’s global IP portfolio, includ- than 31 ports in the United States. I think we can say because
ing the famous UL certiication marks. Mr. Brown develops of our brand protection efforts, we help prevent tens of mil-
and implements strategies, policies, and programs for the lions of dollars of potentially dangerous counterfeit products
protection of UL IP assets, treatment of third-party IP and from entering the stream of commerce and reaching consum-
other IP best practices, and mitigation of UL’s legal risk. He ers’ hands. This is part of our public safety mission. So, if
provides counsel to UL executives and staff on signiicant you were to annualize the data, there’s more than one seizure
IP and legal issues affecting the company as well as negoti- per day of shipments of counterfeit products with unauthor-
ates IP-related business transactions. Prior to joining UL in ized UL marks on them.
2009, Mr. Brown practiced law at Kirkland & Ellis and also
at Marshall, Gerstein & Borun. I see that UL has formed the International IP Crime Investi-
gators College. I would like to talk a little bit about that and
UL seems to be way out in front on anticounterfeiting issues; what its function is.
what is the importance of anticounterfeiting to UL, and why? The College is a collaborative effort with Interpol. The
UL’s certiication marks are symbols of trust, integrity, mission of the College is to deliver world-class IP education
and safety. They help ensure consumers’ peace of mind. We to law enforcement agencies and other stakeholders around
don’t make or sell physical products; we license our brand. the world on how to effectively communicate and cooper-
Our reputation as represented in our marks is among our core ate in the ight against counterfeiting and other IP crime. The
assets. And, because we are a trusted brand, particularly for College is delivered on a multilingual platform, with courses
market access, we ind that counterfeiters use our marks on in English, Spanish, French, Arabic, Mandarin, and Portu-
their products to give them a halo of credibility. Our custom- guese, among other languages. So far, 12,500 people have
ers invest resources to earn the UL certiication. It’s important been trained by the College, representing 454 global organi-
to them that we help protect their investments by stopping zations from over 140 countries.
parties from using UL marks to compete unfairly. In 2017, we’re developing a new curriculum aimed at
Consumer safety is very important to us as well. Products global customs oficers. This will provide information and
bearing a counterfeit UL mark provide a false sense of secu- case studies on their role in securing supply chains and
rity to consumers because these items are often poor quality, encouraging transnational cooperation between various law
shoddy, and sometimes very dangerous. enforcement agencies. The College also has a platform for
private rights holders to deliver customized courses to law
Can you give us some idea of the volume of counterfeits UL enforcement to teach them how to identify the private rights
has to deal with? holders’ counterfeit products and marks.
In 2016, we trained oficers from US Customs and Border So, there are platforms for both the public and private sec-
Protection at 12 different ports to identify counterfeit UL cer- tors—it’s free for the public sector, and there’s a paid version
tiication marks. We have similar programs in China, Mexico, for the private sector.
and other parts of the world. Last year, US Customs seized
over 500 shipments with counterfeit UL marks; however, we Could you describe UL’s anticounterfeiting staff?
received many more inquiries. We have a number of investigators who have the responsi-
In the 2016 holiday season, we saw hoverboards enter the bility to research cases for potential counterfeiting of the UL
mark that come to our attention. We have full-time staff dedi-
cated to responding to inquiries from US Customs—verifying
whether or not a UL mark is legitimate. We have lawyers who
work on brand protection efforts and a broader brand protec-
tion team that works with legal, our anticounterfeiting team,
ter Class
marketing, and our market surveillance group. They all work
together to set our brand protection policy and help protect
UL’s brand in furtherance of our public safety mission. So, we
certainly devote a lot of resources to anticounterfeiting. It’s
very important to us as part of our public safety mission.
If you were advising a manufacturer that was new to the busi-

ness and had to consider counterfeiting, how would you tell
them to get started?
I’d start with the basics of trademark protection. We’re
probably largely talking about brand and trademark
Janet A. Marvel is a partner with Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP. She may be reached at JAM@pattishall.com.
counterfeiting. So, make sure your trademarks are registered stay one step ahead of the counterfeiters. While you can add any
with the appropriate trademark ofices—the ofices in the coun- amount of technology or security features to a product, at some
tries where your markets are. You’re also going to want your point it becomes cost prohibitive. Consumers may not choose to
marks recorded with US Customs. That’s a separate process pay the extra money for security features. It’s really a balance.
after you have a trademark registration. If you don’t have a big
enough legal team, or a legal staff member in each country, ask Just out of curiosity, have you heard anything about—I know
outside counsel you trust in your various markets that know the winemakers did this for a while—people using DNA on their
country’s system and laws. You also have to be irm and some- labels?
what aggressive in your anticounterfeiting efforts. Develop Owners use all sorts of various tiny, microscopic particles
a clearly deined policy as to when you will tell law enforce- that you can put into labels, which sometimes require sophis-
ment to seize products and what’s counterfeit and what’s not. ticated machinery or equipment to detect. For a higher value
If you are inconsistent, law enforcement is not going to want to item, you might want a very accurate detection method.
waste their time with you. It’s also important to train US Cus-
toms on how to identify your marks so they have all the needed It sounds like you provide the testing equipment to US Customs in
information. We recommend if you can, have a dedicated inter- order for them to be able to ind a counterfeit in that type of case.
nal team to investigate and respond to US Customs and really Yes, and testing tools are part of our operation too. That’s
bring these matters to a resolution if possible. part of the suite of tools we give to US Customs, helping to
Certainly, UL offers opportunities to meet other brand identify counterfeit UL marks. But, if there’s an expensive
owners and law enforcement oficials. We offer the IP Crime piece of electronic equipment needed to detect whether or not
Conference that we host every year with Interpol and local law a label is accurate, are you really going to give that to thou-
enforcement. The IP Crime College, which I have already men- sands of US Customs oficers and train them on how to use
tioned, is also a good resource to learn about anticounterfeiting. it? If it’s something that’s Internet-based, these guys are often
Another thing to keep in mind, your anticounterfeiting pro- in warehouses and on shipping docks. They’re not necessarily
gram should be a global effort. You need to look not only at going to have an Internet connection to look up a QR code or
where the products are being imported, but also where they’re something else. So, you want to ensure that your anticounter-
being made and exported. There are other parts of the world, feiting features are good and accurate but not so sophisticated
besides the United States, where counterfeits are being manu- that they’re unusable in the ield.
factured. Efforts can be taken there to stop counterfeits at the
source before they even make it out of the country of origin. Does someone have to go to US Customs to tell if something
is counterfeit or not?
How do you work with Chinese customs? Depending on the particular port or country, you may have
China’s customs program is one that looks at both imports to go in person, but it’s not always necessary. It may be that they
and exports from China. We work with China customs simi- send you pictures or other evidence, or it may be that a regis-
larly to how we work with US Customs—we train them and tered agent, whether a law irm or some other party, can look at a
help them identify counterfeit UL marks. They seize and detain shipment of potential counterfeits It’s often just pictures or other
products in much the same way as US Customs. There are also information. Hopefully, it’s enough to make a determination.
other administrative remedies in China that the United States
doesn’t have. They have AIC (Administration for Industry and How do you handle stopping counterfeits that have made it
Commerce) actions where you can have counterfeits seized past US Customs and are for sale within the United States?
and destroyed with raids, in addition to police actions. We’ve It’s one thing for the products to get detained and stopped
had a lot of success in China with criminal actions. And we try by US Customs, but if products have made it through, you’ve
to do similar things in other countries. also got a remedy against the importer or the party that’s
going to distribute the goods. You’ve got the ability to go
It can sometimes be hard for companies to tell if their prod- after them through private civil action that may include nego-
ucts are counterfeited because the counterfeits are so good. tiating a settlement with cease and desist letters or bringing
Do you have any advice on how people can handle that? a lawsuit. You also might want to investigate whether there’s
Know your customers, know your suppliers, and know your a bigger distribution problem going on. I would say if you’re
supply chain. If products are coming from strange sources or are seeing large shipment volumes or multiple instances of the
in markets where you’re not selling them, that’s often a pretty same product being counterfeited over and over, and it looks
good sign they are counterfeit. There are also security features like it’s coming from the same source, then there might be
that you can build into your products. For example, UL uses some kind of organized distribution network.
holographic labels on certain product categories to help us more We do have a civil program where we go after counterfeit-
easily determine whether a UL mark on a product is counterfeit. ers and have collected money, which goes back to funding
There are all sorts of technologies that can be used to deter- our public safety mission. But, it really depends on the facts.
mine whether or not a mark is counterfeit. However, anything A lot of times it’s ly-by-night operations so it may not be
can be copied with enough time and resources. You have to try to worth spending on litigation. But, in other cases, you may
have a bigger distributor or retailer selling products that are a combination of enforcement, partnership, and education.
counterfeit and causing inancial harm to the brand owner. We’ve talked a bit about US Customs enforcement and
law enforcement, but we take our own private civil actions
Counterfeits often turn up at lea markets. How do you handle when we need to. We partner with US Customs, law enforce-
that situation? ment, and other brand owners. We build our network of
An investigator or someone else who is familiar with your parties who are interested in stopping IP crime. We educate
marks and your brands can identify counterfeits at a lea mar- through the IP Crime College. We’re involved with the Inter-
ket. You can serve sellers with a cease and desist letter . . . I national Trademark Association (INTA) and serve on its
would recommend doing that right away. If you catch them anticounterfeiting committee, in addition to being a mem-
doing it again, they have knowledge, which gives you good ber of the International AntiCounterfeiting Coalition (IACC).
facts for a case of willfulness, giving you enhanced remedies These are all places where you can network and learn about
for trademark infringement. how to stop counterfeiting, stay current on the law, and get
Also, if you have good reason to know there will be coun- information on which strategies are working and which
terfeiting of your brand at a lea market, you can bring law aren’t. For us at least, this combination is working.
enforcement with you to seize product. You will see simi-
lar things, for example, with counterfeiters outside concerts. What about educating the general public?
They’ll have bootleg merchandise and, a lot of times, you’ll see UL for a long time has collaborated with Disney on a
US Marshals serving temporary restraining orders against those number of videos aimed at kids, using the characters from
counterfeiters, stopping products before they’re even sold. The Lion King: Timon and Pumbaa. A couple of years ago,
we put out a DVD with Disney called Safety Smart: Honest
A lot of counterfeiting now seems to be done online, and coun- & Real, which was aimed at school-aged kids to teach them
terfeit products are drop-shipped into the United States. How do about the value of being honest. I know it sounds silly, but
you manage anticounterfeiting efforts against online entities? we are asked: “Are you trying to teach little kids about coun-
That can be very challenging. There are various tools avail- terfeiting?” It’s helpful to start education at a very young age
able to scour the Internet to ind counterfeit product. It’s more about why it’s wrong to steal and why it’s important to be
of a visual thing; one data point. There are certain product cat- honest. You really need to aim at all different age levels and
egories our customers don’t sell on certain retailer platforms. So, parts of society to really get the anticounterfeiting message
when we see those, we have a pretty good suspicion that they out there. It’s cultural, too. It’s not as bad in the United States
are fake. We also do some random purchases online from cer- as it is in other countries where there is just a cultural thought
tain marketplaces to see if the products we buy are legitimate. process of: “Yeah, it’s okay to buy counterfeit. It’s ine.
Drop-shipping and using express consignment has deinitely They’re cheap. It’s just what we do.” So, it’s going to take a
made it more challenging. You have any number of these online long time to change perceptions about that.
platforms that connect you to a number of manufacturers and
retailers around the world, making policing much more dificult. Do you do anything in any foreign countries where there is a
cultural expectation?
So any tips for how to do it? Do you recommend that most man- That video I mentioned, Honest & Real, has been translated
ufacturers hire an outside entity to do the scouring for them? in 10 or so different languages. One of the important things is
That’s deinitely a more cost-effective way to do it. We have an getting people to understand that IP crime is not a victimless
investigator on our staff who’s solely focused on online enforce- crime. Counterfeiting usually is associated with other types of
ment, but not every brand may have those resources. Building crime, like human traficking and drug traficking. Counter-
relationships with the platforms is important as well because most feiting is a fairly safe way for those criminals to make money,
don’t want to be in the business of selling counterfeits. which is why they often do it, but it’s usually part of a bigger
This is a rapidly evolving area. In the past couple of years, set of crimes. So it’s necessary to understand that when they’re
we’ve seen a lot more interest in or from the platforms in try- buying that fake bag, it’s not money just going in some per-
ing to stop counterfeiting. I think getting to know the people son’s pocket, it’s going to fund all these horrible things.
who operate the platforms is helpful to understand their posi-
tions and build up relationships. Then, when you do have a If you had a wish list, what would you like to see done to
problem, you’re going to get more cooperation in resolving it. combat counterfeiting in the future?
It’s very important to remember that trade agreements
Oftentimes anticounterfeiting seems like a whack-a-mole-type often contain provisions on IP protection. It would be a
game. Do you think there are broad-ranging strategies that shame to lose some of those because counterfeiting is ulti-
help manufacturers make counterfeiting less of a problem and mately a threat to public safety. Regardless of what happens, I
expense over time? would hope that international law enforcement, US Customs,
Counterfeiting is never going to stop—understanding that and brand owners continue to work together toward this com-
is important. We handle it by using a multipronged approach, mon goal of stopping counterfeiting and IP crime. n
PATENTING THE
OUTPUT OF
AUTONOMOUSLY
INVENTIVE
By Ryan B. Abbott
MACHINES
A
n innovation revolution is on the horizon. Artiicial intel
ligence (AI) has been generating inventive output for
decades, and now the continued and exponential
growth in computing power is poised to take creative machines
from novelties to major drivers of economic growth. A creative
singularity in which computers overtake human inventors as
the primary source of new discoveries is foreseeable.
This phenomenon poses new challenges to the traditional
paradigm of patentability. Computers already are generating
patentable subject matter under circumstances in which the
computer, rather than a human inventor, meets the require-
ments to qualify as an inventor (a phenomenon I refer to as
“computational invention”).1 Yet, it is not clear that a computer
could be an inventor or even that a computer’s invention could
be patentable. There is no statute addressing computational
Ryan B. Abbott is a professor of law and health sciences at the

University of Surrey School of Law in the United Kingdom, and
an adjunct assistant professor at David Geffen School of Medicine
Photo: iStockPhoto
at the University of California, Los Angeles. He can be reached at

r.abbott@surrey.ac.uk. This article is adapted from the author’s
article “I Think, Therefore I Invent: Creative Computers and the
Future of Patent Law,” 57 B.C. L. Rev. 1079 (2016).
formation.”3 The Creativity Machine is able to generate novel
ideas through the use of a software concept referred to as artii-
cial neural networks—essentially, collections of on/off switches
invention, no case law directly on the subject, and no pertinent that automatically connect themselves to form software without
US Patent and Trademark Ofice (USPTO) policy.2 human intervention. The Creativity Machine independently gen-
These are important issues to resolve. Inventors have own- erated the subject matter of a patent granted in 1998.4 Dr. Thaler
ership rights in their patents, and failure to list an inventor can listed himself as the inventor on the patent and did not disclose
result in a patent being held invalid or unenforceable. Moreover, the Creativity Machine’s involvement to the USPTO.
government policies encouraging or inhibiting the development Similarly, software modeled after the process of biological
of creative machines will play a critical role in the evolution of evolution, known as genetic programming (GP), has succeeded
computer science and the structure of the R&D enterprise. Soon in independently generating patentable results.5 Evolution is a
computers will be routinely inventing, and it may only be a mat- creative process that relies on a few simple processes: “muta-
ter of time until computers are responsible for most innovation. tion, sexual recombination, and natural selection.”6
This article addresses whether a computer could and GP emulates these same methods digitally to
should be an inventor for the purposes of patent law as well achieve machine intelligence. As early as 1996,
as whether computational inventions could and should be GP succeeded in independently generating
patentable. It argues that computers can be inventors because results that were the subject of past patents.7
although AI would not be motivated to invent by the pros- In 2005, a patent was issued for subject
pect of a patent, computer inventorship would incentivize the matter independently generated by a GP-
development of creative machines. In turn, this would lead to based AI named the “Invention Machine.”8
new scientiic advances. The Creativity Machine and the Inven-
This article also examines some of the implications of tion Machine may be the earliest examples
computer inventorship for other areas of patent law. For of computer inventors, but others
instance, computers are a natural substitute for the per- exist.9 Moreover, the exponen-
son having ordinary skill in the art (PHOSITA or, simply, tial growth in computing
the skilled person) used to judge a patent’s inventiveness. power over the past dozen
The skilled person is presumed to know of all the prior art
(what came before an invention) in a particular ield—a
legal iction that could be accurate in the case of
a computer. Substituting a computer for
the skilled person also suggests a need to
expand the scope of prior art, given that
computers are not limited by human dis-
tinctions of scientiic ields. This would
make it more challenging for inventions to
be held nonobvious, particularly in the case
of inventions that merely combine existing
elements in a new coniguration (combina-
tion patents). That would be a desirable outcome,
although the new test would create new challenges.
Creative Computers and Patent Law

Computers Independently Generate
Patentable Results
Computers have been autonomously cre-
ating inventions for decades. In 1994,
computer scientist Stephen Thaler
disclosed an AI system he called the
“Creativity Machine,” a computational
paradigm that “came the closest yet to
emulating the fundamental neurobio-
logical mechanisms responsible for idea
years combined with the increasing sophistication of software The Role of People in Inventive Activity
should have led to an explosion in the number of compu- Just as computers can be involved in the inventive process
tational inventions. Indeed, it is likely that computers are without contributing to conception, so can people. For now, at
inventing more than ever before. least, computers do not entirely undertake tasks on their own
accord. Computers require some amount of human input to
generate creative output.
COMPUTERS ARE Yet, simply providing a computer with a task and starting
materials would not make a person an inventor.12 Imagine I
NOT HUMAN, AND give my engineer friend some publicly available battery sche-
matics and ask her to develop an iPhone battery with twice
AS SUCH THEY
the standard battery life. If she succeeds in developing such
a battery, I would not qualify as an inventor of the battery by
having instructed her to create a result.
FACE UNIQUE People are also necessarily involved in the creative pro-
cess because computers do not arise from a void—humans
BARRIERS TO
have to create computers. Once again, that should not prevent
computer inventorship. I would not exist without my parents
contributing to my conception (pun intended), but that does
QUALIFYING AS not make my parents inventors on my patents. If a computer
scientist creates an AI to autonomously develop useful infor-
INVENTORS.
mation and the AI creates a patentable result in an area not
foreseen by the inventor, there would be no reason for the sci-
entist to qualify as an inventor on the AI’s result. An inventor
Human and Computer Involvement in must have formed a “deinite and permanent idea of the com-
Computational Inventions plete and operative invention” to establish conception.13 The
Requirements for Inventorship scientist might have a claim to inventorship if he developed
For an individual to be an inventor, he or she must contribute the AI to solve a particular problem and it was foreseeable
to an invention’s “conception.” Conception refers to “the for- that the AI would produce a particular result.
mation in the mind of the inventor of a deinite and permanent
idea of the complete and operative invention as it is thereafter Combining Human and Computer Creativity
to be applied in practice.”10 It is “the complete performance of A computer may not be a sole inventor; the inventive process
the mental part of the inventive act.”11 After conception, some- can be a collaborative process between person and machine.
one with ordinary skill in the invention’s subject matter (e.g., a By means of illustration, suppose a human engineer provides
chemist if the invention is a new chemical compound) should a machine with basic information and a task. The engineer
be able to reduce the invention to practice. That is to say, he might learn from the machine’s initial output, then alter the
or she should be able to make and use an invention from a information that he or she provides to the machine to improve
description without extensive experimentation or additional its subsequent output. After several iterations, the machine
inventive skill. Individuals who simply reduce an invention might produce a inal output that the engineer might directly
to practice—for example, by describing an already conceived alter to create a patentable result. In such a case, both the
invention in writing or by building a working model from a engineer and the machine might have played a role in concep-
description—do not qualify as inventors. tion. Leaving AI aside, invention rarely occurs in a vacuum,
and there are often joint inventors on patents. In some of
The Role of Computers in Inventive Activity these instances, if a computer were human, it would be an
Although computers are commonly involved in the inventive inventor. Yet, computers are not human, and as such they face
process, in most cases, computers are essentially working as unique barriers to qualifying as inventors.
sophisticated (or not-so-sophisticated) tools. In such instances, a
computer may assist a human inventor in reducing an invention Barriers to Computer Inventorship
to practice, but the computer is not participating in the inven- The Legal Landscape
tion’s conception. Even when computers play a more substantive Congress is empowered to grant patents on the basis of the
role in the inventive process, such as by analyzing data in an patent and copyright clause of the Constitution. That clause
automated fashion, retrieving stored knowledge, or recognizing enables Congress “[t]o promote the Progress of Science and
patterns of information, the computer still may fail to contribute useful Arts, by securing for limited Times to Authors and
to conception. Computer involvement might be conceptualized Inventors the exclusive Right to their respective Writings and
on a spectrum: on one end, a computer is simply a tool assisting Discoveries.”14 It also provides an explicit rationale for grant-
a human inventor; on the other end, the computer independently ing patent and copyright protection, namely to encourage
meets the requirements for inventorship. AI capable of acting innovation under an incentive theory. The theory goes that peo-
autonomously such as the Creativity Machine and the Invention ple will be more inclined to invent things (i.e., promote the
Machine fall on the latter end of the spectrum. progress of science) if they can receive government-sanctioned
monopolies (i.e., patents) to exploit commercial embodiments schematics and instruct it to develop an iPhone battery with
of their inventions. Having the exclusive right to sell an inven- twice the standard battery life. The AI could produce results
tion can be tremendously lucrative. in the form of a report titled “Design for Improved iPhone
The Patent Act, which here refers to United States patent law Battery”—complete with schematics and potentially even
as a whole, provides a few challenges to computers qualifying as preformatted as a patent application. It seems ineficient and
inventors under the patent and copyright clause. First, the Patent unfair to reward me for recognizing the AI’s invention when I
Act requires that inventors be “individuals.”15 This language has have not contributed signiicantly to the innovative process.
been in place since at least 1952 legislation that established the Such a system might also create logistical problems. If
basic structure of modern patent law. The “individual” require- I created an improved iPhone battery as a human inven-
ment likely was included to relect the constitutional language tor, I would be its inventor regardless of whether anyone
that speciically gives “inventors” the right to their discoveries subsequently understood or recognized the invention. If I
as opposed to other legal entities such as corporations that might instructed my AI to develop an improved iPhone battery,
assert ownership rights. Such language would help to ensure that the irst person to notice and appreciate the AI’s result could
patent rights were more likely to go to individual inventors than become its inventor (and prevent me from being an inventor).
to corporate entities where ownership was disputed. Legisla- One could imagine this creating a host of problems: the irst
tors were not thinking about computational inventions in 1952. person to recognize a patentable result might be an intern at
Second, patent law jurisprudence requires that inventions be the a large research corporation or a visitor in someone’s home.
result of a “mental act.”16 So, because computers are not individ- A large number of individuals might also concurrently recog-
uals and it is questionable that they engage in a mental act, it is nize a result if access to an AI is widespread.
unclear whether a computer autonomously conceiving of a pat- More ambitiously, treating computational inventions as
entable invention could legally be an inventor. patentable and recognizing creative computers as inven-
tors would be consistent with the constitutional rationale
Avoiding Disclosure of Artiicially Intelligent Inventors for patent protection. It would encourage innovation under
Given that computers are functioning as inventors, and an incentive theory. Patents on computational inventions
likely inventing at an escalating rate, it would seem that the would have substantial value independent of the value of
USPTO should be receiving an increasing number of applica- creative computers; allowing computers to be listed as inven-
tions claiming computers as inventors. That the USPTO has tors would reward human creative activity upstream from the
not suggests that applicants are choosing not to disclose the computer’s inventive act. Although AI would not be moti-
role of AI in the inventive process. That may be due to legal vated to invent by the prospect of a patent, it would motivate
uncertainties about whether an AI inventor would render an computer scientists to develop creative machines. Financial
invention unpatentable. Without a legal inventor, new inven- incentives may be particularly important for the develop-
tions would not be eligible for patent protection and might ment of creative computers because producing such software
enter the public domain after being disclosed. is resource intensive. Though the impetus to develop creative
There is another reason why computers might not be AI might still exist if computational inventions were con-
acknowledged: a person can qualify as an inventor simply by sidered patentable but computers could not be inventors, the
being the irst individual to recognize and appreciate an exist- incentives would be weaker owing to the logistical, fairness,
ing invention. That is to say, someone can discover rather and eficiency problems such a situation would create.
than create an invention. Uncertainty (and accident) is often There are other beneits to patents beyond providing an ex
part of the inventive process. In such cases, an individual ante innovation incentive. Permitting computer inventors and
need only understand the importance of an invention to qual- patents on computational inventions might also promote dis-
ify as its inventor. Thus, assuming that a computer cannot be closure and commercialization. Without the ability to obtain
an inventor, individuals who subsequently “discover” compu- patent protection, owners of creative computers might choose
tational inventions by mentally recognizing and appreciating to protect patentable inventions as trade secrets without any
their signiicance would likely qualify as inventors. So, it public disclosure. Likewise, businesses might be unable to
may be the case that computational inventions are only pat- develop patentable inventions into commercial products
entable when an individual subsequently discovers them. without patent protection. In the pharmaceutical and biotech-
nology industries, for example, the vast majority of expense
In Support of Computer Inventors in commercializing a new product is incurred after the prod-
Computers Should Qualify as Legal Inventors uct is invented during the clinical testing process required to
Arguments Supporting Computer Inventors obtain regulatory approval for marketing.
Preventing patents on computational inventions by prohib-
iting computer inventors, or allowing such patents only by Arguments against Computer Inventors
permitting humans who have discovered the work of creative Those arguments relect the dominant narrative justifying the
machines to be inventors, is not an optimal system. In the lat- grant of intellectual property protection. That account, how-
ter case, AI may be functioning more or less independently, ever, has been criticized, particularly by academics. Patents
and it is only sometimes the case that substantial insight is result in signiicant social costs by establishing monopolies.17
needed to identify and understand a computational invention. Patents also can stile entry by new ventures by creating bar-
Imagine that I give my AI some publicly available battery riers to subsequent research.18 Whether the beneit of patents
as an innovation incentive outweighs their anticompetitive and policymakers should be guided irst and foremost by the
costs, or whether patents even have a net positive effect on explicit constitutional rationale for granting patents. Fur-
innovation, likely varies between industries, areas of scien- ther, allowing patents on computational inventions as well as
tiic research, and inventive entities. computer inventors would do away with what is essentially a
For instance, commentators have argued that patents may legal iction—the idea that only a human can be the inventor
not be needed to incentivize R&D in the software industry.19 of the autonomous output of a creative computer—resulting
Software innovation is often relatively inexpensive, incremen- in fairer and more effective incentives.
tal, quickly superseded, produced without patent incentives,
protected by other forms of intellectual property, and associ- Computer Inventors Are Permitted under a Dynamic Inter-
ated with a signiicant irst-mover advantage. Likewise, patents pretation of Current Law
may be unnecessary to spur innovation in university settings Whether a computer can be an inventor in a constitutional
where inventors are motivated to publish their results for pres- sense is a question of irst impression. If creative computers
tige and the prospect of academic advancement.20 should be inventors, as this article has argued, then a dynamic
Of course, computational invention patents may not be an interpretation of the law should allow computer inventorship.
all-or-nothing proposition; they may further encourage activi- Such an approach would be consistent with the founders’
ties that would have otherwise occurred on a smaller scale over intent in enacting the patent and copyright clause and would
a longer time frame. If patents are not needed to incentivize further the purpose of the Patent Act. It would not run afoul
the development of creative computers, it may be justiiable to of the chief objection to dynamic statutory interpretation,
treat computational inventions as unpatentable and fail to rec- namely interference with reliance and predictability and the
ability of citizens “to be able to read the statute books and
know their rights and duties.”22 That is because a dynamic
OWNERSHIP interpretation would not upset an existing policy; permitting

computer inventors would allow additional patent applica-
tions rather than retroactively invalidate previously granted
RIGHTS TO patents, and there is naturally less reliance and predictability
in patent law given its highly dynamic subject area and strug-
COMPUTATIONAL gle to adapt to constantly changing technologies.

Computer inventorship should not be prohibited based on
statutory text designed to favor individuals over corporations.
INVENTIONS It would be particularly unwise to prohibit computer inven-
tors based on literal interpretations of texts written when
SHOULD VEST IN computational inventions were unforeseeable. If computer

inventorship is to be prohibited, it should only be on the basis
A COMPUTER’S
of sound public policy. Computational inventions may even
be especially deserving of protection because computational
creativity may be the only means of achieving certain discov-
OWNER. eries that require the use of tremendous amounts of data or

that deviate from conventional design wisdom.
ognize computer inventors. Yet, whether patents produce a net Implications of Computer Inventorship
beneit as an empirical matter is dificult to determine a priori. Computational Invention Ownership
Even though individuals and businesses do not always behave If computers are recognized as patent inventors, there remains
as rational economic actors, in the aggregate, it is likely that the question of who would own these patents. Computers can-
providing additional inancial incentives to spur the develop- not own property, and it is safe to assume that “computer
ment of creative computers will produce a net beneit. personhood” is not on the horizon. This presents a few obvious
Patents for computational inventions might also be options for patent ownership (assignment) such as a comput-
opposed on the grounds that they would chill future human er’s owner (the person who owns the AI as a chattel), developer
innovation, reward human inventors who failed to contribute (the person who programmed the AI’s software), or user (the
to the inventive process, and result in further consolidation person giving the AI tasks). The owner, developer, and user
of intellectual property in the hands of big business. Other may be the same person, or they may be different entities.
nonutilitarian patent policies may similarly fail to support Ownership rights to computational inventions should vest
computer inventorship.21 in a computer’s owner because it would be most consistent
Ultimately, despite concerns, computer inventorship with the way personal property (including both computers
remains a desirable outcome. The inancial motivation it and patents) is treated in the United States and it would most
will provide to build creative computers is likely to result in incentivize computational invention. It would encourage
a net increase in the number of patentable inventions pro- owners to promote access to their AI systems with the hopes
duced. Particularly, while quantitative evidence is lacking of having users generate patentable results.
about the effects of computational invention patents, courts This also reveals an important reason why computational
invention works best when the computer is the legal inven- skilled at repetitive processes that produce expected results.
tor. If computational inventions were treated as patentable If the skilled person were capable of inventive activity, then
but computers could not be inventors, then presumably the inventive patent applications would appear obvious.
irst person to recognize a computer’s invention would be the Replacing the skilled person with the skilled computer sug-
legal inventor and patent owner. That means the computer’s gests a change to the nonobviousness test. At present, the test
user, rather than its owner, would likely be the patentee as the takes into account the skilled person’s knowledge of the prior
person able to irst recognize a computational invention. To art. Decreasing the universe of prior art would make it easier to
the extent this is an undesirable outcome, the best solution get a patent because, with less background knowledge, a new
may be to permit computer inventorship. invention would be more likely to appear inventive. Likewise,
Assignment of computational inventions to a computer’s expanding the universe of prior art would raise the patent-
owner could be taken as a starting point, although parties would ability bar. Although it may be unrealistic to expect a human
be able to contract around this default. As computational inven- inventor to have knowledge of prior art in unrelated ields,
tions become more common, negotiations over these inventions there is no reason to limit a computer’s database to a particu-
may become a standard part of contract negotiations. lar subject matter. A human inventor may not think to combine
cooking recipes with advances in medical science, but a com-
Rethinking the Ultimate Test of Patentability puter would not be limited by such self-imposed restrictions.
Considering the case for computer inventorship provides Now that humans and computers are competing creatively, the
insight into other areas of patent law. Take, for instance, the universe of prior art should be expanded.
nonobviousness requirement for grant of a patent.23 Part of the This change would produce a positive result. The PHOS-
requirement’s evaluation involves employing the legal iction ITA standard has been the subject of extensive criticism, most
of a PHOSITA (or skilled person) who serves as a reference of which has argued the criteria for assessing nonobviousness
for determining whether an invention is nonobvious. Essen- are not stringent enough and therefore too many patents of
tially, an applicant cannot obtain a patent if a skilled person questionable inventiveness are issued.26 Expanding the scope
would have found the difference between a new invention and of prior art would make it more challenging to obtain pat-
the prior art (what came before the invention) obvious. The test ents, particularly combination patents. The Supreme Court
presumes that the skilled person is selectively omniscient, hav- has particularly emphasized “the need for caution in granting
ing read, understood, and remembered every existing reference a patent based on the combination of elements found in the
from the prior art in the relevant ield of invention (analogous prior art.”27 The scope of analogous prior art has consistently
art). A federal judge explained that the way to apply the obvi- expanded in patent law jurisprudence, and the substitution of
ousness test is to “irst picture the inventor as working in his a skilled computer would complete that expansion.
shop with the prior art references—which he is presumed to Of course, the new standard would pose new challenges.
know—hanging on the walls around him.”24 With human PHOSITAs, juries are asked to put themselves in
Needless to say, no actual person could have such knowl- the shoes of the skilled person and decide subjectively what
edge, but the standard helps avoid dificult issues of proof that person would have considered obvious. A jury would have
related to an inventor’s actual knowledge; also, it prevents a dificult time deciding what a “skilled” computer would con-
obvious variations of publicly disclosed inventions from sider obvious. They could consider some of the same factors
being patented. Stopping obvious variations from being pat- that are applied to the skilled person, or perhaps the test could
ented is important because that prevents the removal of require a combination of human and computer activity. For
knowledge from the public domain. Inventions that would example, the skilled computer might be a skilled person with
have been obvious to skilled persons are already within reach access to a computer’s unlimited database of prior art.
of the public. This raises the bar to obtaining a patent—a
result that is desirable because patents should not be granted Conclusion
lightly given their anticompetitive effects. At the same time, It is important for policymakers to give serious consideration
creating too high a bar to patentability is undesirable because to the issue of computer inventorship. There is a need for the
then patents would fail to adequately incentivize researchers. USPTO to issue guidance in this area, for Congress to recon-
A balance is needed. Ideally, the system would only issue pat- sider the boundaries of patentability, and for the courts to
ents for inventions that would not have been created but for decide whether computational invention is worthy of protec-
the expectation of obtaining a patent. The importance of the tion. Doing so and recognizing that computers can be inventors
nonobvious requirement to patentability has led to its charac- will do more than address an academic concern; it will provide
terization as the “ultimate condition of patentability.”25 certainty to businesses, afford fairness to research, and promote
The idea of a PHOSITA understanding all of the prior art the progress of science. In the words of Thomas Jefferson,
in the ield was always ictional, but now it is possible for “ingenuity should receive a liberal encouragement.”28 What
a skilled entity, in the form of a computer, to possess such could be more ingenious than creative computers? n
knowledge. This makes the skilled computer a natural substi-
tute for the hypothetical skilled person. The standard would Endnotes
require a skilled computer rather than a creative computer 1. Ryan Abbott, Hal the Inventor: Big Data and Its Use by Artii-
for the same reason that the skilled person is not an inventive cial Intelligence, in Big Data Is Not a Monolith 187 (Cassidy R.
person. A PHOSITA has traditionally been characterized as Sugimoto et al. eds., 2016).
2. See Ben Hattenbach & Joshua Glucoft, Patents in an Era of 16. Townsend, 36 F.2d at 295.
Ininite Monkeys and Artiicial Intelligence, 19 Stan. Tech. L. Rev. 17. See Daniel J. Hemel & Lisa Larrimore Ouellette, Beyond the
32, 44 (2015). Patents–Prizes Debate, 92 Tex. L. Rev. 303, 314–15 (2013).
3. See What Is the Ultimate Idea?, Imagination Engines Inc., 18. See Arti Kaur Rai, Regulating Scientiic Research: Intellec-
http://www.imagination-engines.com (last visited July 5, 2017). tual Property Rights and the Norms of Science, 94 Nw. U. L. Rev.
4. U.S. Patent No. 5,852,815 (iled May 15, 1998). 77, 133 (1999).
5. John R. Koza, Human-Competitive Results Produced by 19. See William M. Landes & Richard A. Posner, The Eco-
Genetic Programming, 11 Genetic Programming & Evolvable nomic Structure of Intellectual Property Law 312–13
Machines 251, 265 (2010). (2003).
6. John R. Koza et al., Evolving Inventions, Sci. Am., Feb. 2003, 20. See Mark A. Lemley, Are Universities Patent Trolls?, 18
at 52. Fordham Intell. Prop. Media & Ent. L.J. 611, 621 (2008).
7. See Koza, Human-Competitive Results, supra note 5, at 255– 21. Abbott, supra note 1, at 196.
56, 265. 22. See William N. Eskridge Jr. & Philip P. Frickey, Statutory
8. U.S. Patent No. 6,847,851 (iled July 12, 2002). Interpretation as Practical Reasoning, 42 Stan. L. Rev. 321, 340
9. See, e.g., Daniel Riester et al., Thrombin Inhibitors Identiied (1990).
by Computer-Assisted Multiparameter Design, 102 Proc. Nat’l 23. See 35 U.S.C. § 103.
Acad. Sci. USA 8597 (2005). 24. In re Winslow, 365 F.2d 1017, 1020 (C.C.P.A. 1966).
10. Townsend v. Smith, 36 F.2d 292, 295 (C.C.P.A. 1929). 25. See Nonobviousness—The Ultimate Condition of Pat-
11. Id. entability (John Witherspoon ed., 1980).
12. Ex parte Smernoff, 215 U.S.P.Q. 545, 547 (Bd. App. 1982) 26. See, e.g., Michael D. Frakes & Melissa F. Wasserman, Does
(“[O]ne who suggests an idea of a result to be accomplished, rather the U.S. Patent and Trademark Ofice Grant Too Many Bad Pat-
than the means of accomplishing it, is not a coinventor.”). ents?: Evidence from a Quasi-Experiment, 67 Stan. L. Rev. 613
13. Townsend, 36 F.2d at 295. (2015).
14. U.S. Const. art. I, § 8, cl. 8. 27. See KSR Int’l Co. v. Telelex Inc., 550 U.S. 398, 415 (2007).
15. E.g., 35 U.S.C. § 100(f) (“The term ‘inventor’ means the 28. Diamond v. Chakrabarty, 447 U.S. 303, 308–09 (1980)
individual or, if a joint invention, the individuals collectively who (quoting 5 Writings of Thomas Jefferson 75–76 (Henry A.
invented or discovered the subject matter of the invention.”). Washington ed., 1871)).
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FORM 18,
I JUSTDON’T
KNOW
WHAT
I WANT HOW THE
ABROGATION
OF FORM 18
HAS CHANGED
By Jeffrey T. Castellano PLEADING
and Nathan R. Hoeschen STANDARDS
O
n December 1, 2015, a long-standing safe haven for plaintiffs in patent infringement cases was eliminated as part
of a partial overhaul of the Federal Rules of Civil Procedure (FRCP).1 The 2015 amendments eliminated Form 18,
an exemplary patent infringement complaint appended to the FRCP and adopted in 1938, which consisted solely of
four brief paragraphs of factual allegations and a demand.
Form 18 was exceedingly plaintiff-friendly and, some said, out of step with the stricter pleading requirements set out by the
Supreme Court in Twombly and Iqbal. But even after those landmark cases changed the meaning of “notice pleading” in fed-
eral court, Form 18 remained the touchstone for adequate pleading of direct infringement,2 and plaintiffs that modeled their
complaint after Form 18 could be reasonably conident that their complaint would survive a Rule 12(b)(6) motion.3
Whether it was due to the rise of nonpracticing entity (NPE) litigation, the heightened pleading standard of Twombly and
Iqbal, or simply that the purpose of the FRCP forms “ha[d] been fulilled” (as the rules committee stated4), Form 18 was elimi-
nated.5 It was then up to the courts to decide how Twombly and Iqbal would be applied in the patent infringement context. Now,
more than a year later, federal courts have laid the groundwork for the treatment of infringement complaints in a post–Form 18
world. While much uncertainty remains, it is clear that the days of pure notice pleading for patent infringement cases are gone.
What Does the Elimination of Form 18 Mean for in particular, has published numerous opinions stating that
Pleading Standards? a complaint must “give rise to a plausible inference that a
The District of Delaware appears to have been the irst court to device meets all elements of a speciic claim.”11 However, it
elucidate a new requirement for post–Form 18 complaints—the has not been stern in its application of this rule, declining to
need to explicitly connect the factual allegations to the ele- dismiss complaints that “do not specify that the accused prod-
ments of the claims. In RainDance Technologies, Inc. v. 10x ucts infringe every element of a particular claim” where they
Genomics, Inc., the plaintiff iled an infringement complaint “identify the central claim limitations.”12 This particularity
that contained a lengthy description of the accused products (a requirement has also led to an interesting split between districts
complex biological lab instrument and related consumables) regarding whether a complaint must allege facts linking the
and how they functioned, complete with numerous diagrams accused products to each asserted claim, or only to one claim
and pictures.6 Perhaps due to the complexity of the technology per patent.13
involved, it was impossible for the court to determine which of Courts in the Northern District of California have expressed
the many components of the accused products corresponded to similar doubts about the viability of Form 18 pleading, but
the claims.7 The court dismissed the complaint.8 have generally declined to apply a heightened pleading stan-
Subsequently, courts in other popular patent litigation dard to pending cases.14 Even when applying the new standard,
jurisdictions—including the Northern District of Illinois, the Northern District of California has not required the same
the Eastern District of Virginia, and the District of New Jer- level of detail as other districts, because its local rules require
sey—adopted this requirement, dismissing complaints that such speciicity only in later-served infringement conten-
failed to link the elements of the asserted patent claims to the tions. In Avago Technologies General IP (Singapore) PTE
accused devices.9 Several cases have suggested that, in order Ltd. v. Asustek Computer, Inc., for instance, the complaint
to meet this requirement, a complaint must specify which par- failed to specify which claims of the seven patents-in-suit were
ticular claims are infringed.10 The Eastern District of Texas, infringed or give any description of the manner in which the
accused products functioned or how they infringed.15 Despite
the sparse nature of these allegations—signiicantly less
ONLY ONE detailed than those found wanting in RainDance and similar
to those dismissed by other courts under the new standard—
Judge Edward Chen denied the motion to dismiss, noting that
“this District generally has not required detailed infringe-
CASE HELD ment theories until the time that infringement contentions are
served.”16 Similarly, the Northern District of California has
not required plaintiffs to specify which claims are infringed by
THAT THE which speciic products, again deferring to its normal practice
of requiring such speciicity only when infringement conten-
tions are due under the local rules.17
ABROGATION This reliance upon contentions to ill in the gaps between

Form 18 and Twombly pleading has drawn both approval and
scorn—often within the same district. Quite recently, one
judge in the District of Delaware has approved of the approach,
OF FORM denying a motion to dismiss a complaint that referenced only

exemplary products and claims on the grounds that the local
rules required such speciicity only later in the litigation.18 In
18 HAD NO a similar display of judicial eclecticism, the District of New

Jersey has both endorsed and renounced the practice,19 while
the Southern District of Texas has reached an interesting com-
EFFECT ON THE promise, holding that because its local rules had historically
required additional detail only later in the case, it was not “just
and practicable” to apply the new standards to complaints iled
before the effective date of the amendments.20
OPERATIVE The authors found only one case holding that the abrogation
of Form 18 had no effect on the operative pleading standard.
The plaintiff in Hologram USA, Inc. v. Pulse Evolution Corp.
PLEADING iled an amended complaint that contained allegations notably

similar to those rejected by Judge Richard Andrews in Rain-
Dance—describing in general terms how the accused products
STANDARD. function (“high-powered projectors are used to project an

image onto a rear-projection screen, the image relects of a
transparent foil”) but failing to explicitly connect that descrip-
tion to the elements of the claims.21 Judge Gloria Navarro in
the District of Nevada took the position that the abrogation of products infringe the claims (or to allege which claims are
Form 18 had no effect on the underlying pleading standard, infringed), while judges in the Northern District of Califor-
relying on a note from the advisory committee that the abro- nia are more likely to allow complaints tracking Form 18 to
gation “does not alter existing pleading standards.”22 Shortly survive, leaving it to their patent local rules to draw out the
thereafter, the District of Oregon discussed this same note and details of plaintiffs’ infringement allegations. n
reached the opposite conclusion in Tannerite Sports, LLC v.
Jerent Enterprises, LLC, reasoning that the advisory commit- Endnotes
tee’s reference to “existing pleading standards” referred to the 1. See Fed. R. Civ. P. historical note; id. at appendix of forms
general standards articulated by the Supreme Court in Twom- (noting abrogation).
bly and Iqbal.23 Later opinions in the District of Nevada24 and 2. In re Bill of Lading Transmission & Processing Sys. Patent
Northern District of California25 also reached the opposite con- Litig., 681 F.3d 1323, 1334–35 (Fed. Cir. 2012) (“[T]o the extent the
clusion, dismissing complaints for failing to explain how the parties argue that Twombly and its progeny conlict with the Forms
accused products met each limitation of the claims without any and create differing pleadings requirements, the Forms control. . . .
reference to the earlier decision in Hologram. Form 18 and the Federal Rules of Civil Procedure do not require a
plaintiff to plead facts establishing that each element of an asserted
When Does Form 18 Still Apply? claim is met. Indeed, a plaintiff need not even identify which claims it
A secondary threshold issue that has drawn diverse rulings is asserts are being infringed.” (citation omitted)). But see id. at 1348–49
whether and when the new standard should be applied to cases (Newman, J., dissenting) (collecting district court cases inding that
that were already pending in the district courts when the new “Twombly and Iqbal apply, to the exclusion of Form 18”).
rules took effect. In propounding the new rules, the Supreme 3. K-Tech Telecomms., Inc. v. Time Warner Cable, Inc., 714 F.3d
Court stated that they should be applied to pending cases 1277, 1283 (Fed. Cir. 2013) (“[P]roper use of [Form 18] effectively
“insofar as just and practicable.”26 Seizing upon this language, immunizes a claimant from attack regarding the suficiency of the
district courts have most commonly simply held that it would27 pleading.”).
or would not28 be “just and practicable” to apply the new stan- 4. Fed. R. Civ. P. 84 advisory committee’s note to 2015
dards, with little further analysis or explanation. This has amendment.
drawn divisions even within the same district.29 5. The rules committee was plainly aware of the apparent con-
The opinion in Tannerite is one of only a few that have lict between Form 18 and Twombly/Iqbal. See In re Bill of Lading
devoted any analysis to the question and noted the Supreme Transmission, 681 F.3d at 1350 (Newman, J., dissenting) (discussing
Court’s statement that the amended rules would govern all references in committee minutes to conlict between Twombly/Iqbal
pending proceedings “insofar as just and practicable.”30 Tan- pleading standard and Form 18).
nerite interpreted the Supreme Court’s order adopting the 6. No. 15-cv-152, 2016 WL 927143, at *1 (D. Del. Mar. 4, 2016).
amendments as setting forth a “general rule” that they apply to 7. Id. at *2 (“It is not obvious to me that what Plaintiffs describe
pending cases, with an exception only where their application is an ‘autocatalytic reaction.’ . . . I think, but am not sure, that parti-
would be “unjust and/or not-practicable.”31 The only other case tioning samples is the same as ampliication.”).
to discuss the issue in any depth, Polaris Industries, Inc. v. Arc- 8. Id.
tic Cat Inc., reached the opposite conclusion.32 Beginning from 9. See, e.g., Robern, Inc. v. Glasscrafters, Inc., 206 F. Supp. 3d
the general premise that applying new procedural rules retroac- 1005, 1011 (D.N.J. 2016) (dismissing complaint that “failed to relate
tively is neither “just” nor “practicable,” the Polaris court went factual assertions to the pertinent claims in the . . . patent”); Atlas
on to note several exceptions such as when a new rule merely IP, LLC v. City of Naperville (Atlas I), No. 15 C 10744, 2016 WL
restyles an old, in discovery disputes where the rule will have 3907029, at *3–4 (N.D. Ill. July 19, 2016) (dismissing a formulaic
to be applied to future disputes in the same action, and when complaint for “fail[ing] to allege how the accused products practice,
“the new rule’s very purpose [is] to prevent the application or contain an equivalent of, each limitation of representative claim 1”).
of the old rules.”33 Ultimately, however, the court found that 10. See, e.g., Jenkins v. LogicMark, LLC, No. 3:16-CV-751-HEH,
none of these exceptions applied, and noted that requiring the 2017 U.S. Dist. LEXIS 10975, at *6–7 (E.D. Va. Jan. 25, 2017) (dis-
plaintiff to replead a case to meet new pleading requirements missing complaint where the defendant was “unable to defend itself
“would further delay litigation.”34 properly as it would be forced to gaze into a crystal ball in order to
discern which of the many claims of the asserted patents its products
Conclusion allegedly infringe”); Atlas IP, LLC v. Exelon Corp. (Atlas II), 189 F.
In conclusion, although a general consensus exists among Supp. 3d 768, 775 (N.D. Ill. 2016) (“[I]t is dificult to imagine how an
the most popular patent districts that the abrogation of Form action for infringement could be brought without a tentative but none-
18 has heightened the bar for pleading infringement,35 there theless coherent theory of which claims are allegedly infringed and
remains a great deal of dispute about exactly how the stan- how the accused products practice . . . each of [the asserted] claims’
dard should be applied and to whom. Presently, it is dificult
to predict whether a pleading iled before the rules change Jeffrey T. Castellano is a partner at Shaw Keller LLP in
will be subject to a heightened standard. As to the scope Wilmington, Delaware, specializing in patent litigation. He may be
of that heightened standard, at least some judges in Dela- reached at jcastellano@shawkeller.com. Nathan R. Hoeschen is
ware, the Northern District of Illinois, and New Jersey are an associate at the same irm specializing in patent litigation. He may
apt to dismiss complaints that fail to explain how the accused be reached at nhoeschen@shawkeller.com.
elements.”); Asghari-Kamrani v. United Servs. Auto. Ass’n, No. used to supplement the pleadings and meet the Iqbal/Twombly stan-
2:15cv478, 2016 WL 1253533, at *4 (E.D. Va. Mar. 22, 2016) (dis- dard.”), with Telebrands Corp. v. Ragner Tech. Corp., No. 15-3163
missing complaint that alleged infringement of multiple claims for (ES), 2016 U.S. Dist. LEXIS 114436, at *17 (D.N.J. Aug. 25, 2016)
failing to explain how the individual claims were infringed). (“[T]he Court turns to the Local Patent Rules—just as the Windy
11. See, e.g., Raytheon Co. v. Cray, Inc., No. 2:16-CV- City Innovations court did—to inform the propriety of its ruling.”).
00423-JRG-RSP, 2017 U.S. Dist. LEXIS 56729, at *10 (E.D. 20. Lubrizol Specialty Prods., Inc. v. Flowchem LLC, 165 F.
Tex. Mar. 12, 2017); Huawei Techs. Co. v. T-Mobile US, Inc., No. Supp. 3d 534, 538 (S.D. Tex. 2016).
2:16-CV-00052-JRG-RSP, 2017 U.S. Dist. LEXIS 43240, at *19 21. No. 2:14-cv-0772-GMN-NJK, 2016 WL 199417, at *1–2 (D.
(E.D. Tex. Feb. 20, 2017); PanOptis Patent Mgmt., LLC v. Black- Nev. Jan. 15, 2016).
Berry Corp., No. 2:16-CV-00059-JRG-RSP, 2017 U.S. Dist. LEXIS 22. Id. at *2 n.1 (quoting Fed. R. Civ. P. 84 advisory committee’s
27756, at *10 (E.D. Tex. Feb. 10, 2017). note to 2015 amendment).
12. Semcon IP, Inc. v. Huawei Device USA, Inc., No. 2:16-cv- 23. No. 6:15-cv-00180-AA, 2016 WL 1737740, at *3 (D. Or.
00437-JRG-RSP, 2017 U.S. Dist. LEXIS 37035, at *19 (E.D. Tex. May 2, 2016).
Feb. 20, 2017). In fact, the authors have located no cases from the 24. CG Tech. Dev., LLC v. FanDuel, Inc., No. 2:16-cv-
Eastern District of Texas dismissing a complaint for failing to com- 00801-RCJ-VCF, 2016 WL 6089693, at *3 (D. Nev. Oct. 18, 2016)
ply with the new pleading standard. (“Form 18 and Rule 84 (authorizing the form) were deleted from the
13. Compare Cont’l Circuits LLC v. Intel Corp., No. CV16-2026 Civil Rules in 2015, extinguishing the exception to the Twombly/Iqbal
PHX DGC, 2017 U.S. Dist. LEXIS 23842, at *12 (D. Ariz. Feb. 21, pleading standard for direct infringement claims.”).
2017) (“Nor is Plaintiff required, as Defendants maintain, to allege 25. e.Digital Corp. v. iBABY Labs, Inc., No. 15-CV-05790-JST,
facts supporting every limitation of every claim in each of the four 2016 WL 4427209, at *3 (N.D. Cal. Aug. 22, 2016).
patents-in-suit.”), with Oil-Dri Corp. v. Nestle Purina Petcare Co., No. 26. Order Amending Federal Rules of Civil Procedure (U.S.
15-cv-1067, 2017 U.S. Dist. LEXIS 48358, at *13 (N.D. Ill. Mar. 31, Apr. 29, 2015).
2017) (“It makes little sense that a plaintiff could plead infringement 27. See, e.g., Erindergemeinschaft Uropep GbR v. Eli Lilly &
as to one patent claim and then proceed in the litigation with respect Co., No. 2:15-CV-1202-WCB, 2016 WL 1643315, at *4 n.3 (E.D.
to every other materially different claim in the patent.”). Tex. Apr. 26, 2016); RainDance Techs., Inc. v. 10x Genomics, Inc.,
14. See, e.g., Bluestone Innovations LLC v. Bulbrite Indus., Inc., No. 15-152-RGA, 2016 WL 927143, at *2 (D. Del. Mar. 4, 2016).
No. 15-CV-5478-PJH, 2016 WL 1535059, at *3 (N.D. Cal. Apr. 15, 28. See, e.g., Gym Door Repairs, Inc. v. Young Equip. Sales, Inc.,
2016) (“At the time that Bluestone iled the complaint, Form 18 No. 15-cv-4244 (JGK), 2016 WL 4747281, at *6 (S.D.N.Y. Sept. 12,
was still operative and controlling. With regard to the allegations 2016), reconsideration denied, No. 15-CV-4244 (JGK), 2016 WL
of direct infringement, the complaint includes all the allegations 6652733 (S.D.N.Y. Nov. 10, 2016); Imation Corp. v. Sanho Corp., No.
required by Form 18 . . . .”). 15-1883 (JRT/JSM), 2016 WL 4179363, at *3–4 (D. Minn. Aug. 5,
15. No. 15-cv-04525-EMC, 2016 WL 1623920, at *4 (N.D. Cal. 2016); Nexeon Ltd. v. Eaglepicher Techs., LLC, No. 15-955-RGA-
Apr. 25, 2016). MPT, 2016 WL 4045474, at *4 (D. Del. July 26, 2016).
16. Id. But see e.Digital Corp. v. iBABY Labs, Inc., No. 15-CV- 29. Compare RainDance, 2016 WL 927143, at *2 (“[I]t would
05790-JST, 2016 WL 4427209, at *3 (N.D. Cal. Aug. 22, 2016) be in the interest of justice to [apply the new pleading standards].”),
(granting motion to dismiss where the plaintiff failed to provide a with Nexeon, 2016 WL 4045474, at *4 (“In the interest of justice
limitation-by-limitation analysis of how accused products infringed and practicability, Form 18 should still be used to analyze the sufi-
at least one exemplary claim). ciency of the pleadings.”).
17. See Windy City Innovations, LLC v. Microsoft Corp., 193 F. 30. Tannerite Sports, LLC v. Jerent Enters., LLC, No. 6:15-cv-
Supp. 3d 1109, 1115 (N.D. Cal. 2016) (“[D]efendant’s argument that it 00180-AA, 2016 WL 1737740, at *2–5 (D. Or. May 2, 2016).
should be entitled to notice at the pleading stage of which speciic prod- 31. Id. at *4.
ucts infringed on which speciic claims in the patents is belied by both 32. No. 15-4129 (JRT/LIB), 2016 WL 3541541, at *1–2 (D.
the local patent rules and Federal Circuit authority.”). But see Rembrandt Minn. June 23, 2016).
Patent Innovations LLC v. Apple Inc., No. C 14-05094 WHA, 2015 WL 33. Id. at *2.
8607390, at *3 (N.D. Cal. Dec. 13, 2015) (noting that following abroga- 34. Id.
tion of Form 18 the plaintiff was required to amend its complaint, rather 35. Interestingly, a small smattering of courts appear to be applying
than just merely its infringement contentions, when it became aware of a standard lower than formerly required by Form 18, requiring plaintiffs
new infringing products). Although the complaints in Avago and Windy only to allege that the defendants’ products “perform the same unique
City were both iled prior to the abrogation of Form 18, neither court function as Plaintiff’s patented system.” InCom Corp. v. Walt Disney
speciically ruled that a new standard applied. Instead, both courts sim- Co., No. CV15-3011 PSG (MRWx), 2016 U.S. Dist. LEXIS 71319, at
ply “assumed” for the sake of the motion that the new standard applied. *8 (C.D. Cal. Feb. 4, 2016); SimpliVity Corp. v. Springpath, Inc., No.
Windy City, 193 F. Supp. 3d at 1115; Avago, 2016 WL 1623920, at *4. 4:15-13345-TSH, 2016 U.S. Dist. LEXIS 155017, at *15–16 (D. Mass.
18. This opinion from Judge Gregory Sleet did not reference July 15, 2016) (inding complaint plausible because it alleged “that the
the apparently divergent holding Judge Andrews reached in Rain- accused product ‘also do[es] what the patent does’” (quoting InCom));
Dance. Koninklijke Philips N.V. v. ASUSTeK Comput. Inc., No. CV see also Wright’s Well Control Servs., LLC v. Oceaneering Int’l, Inc.,
15-1125-GMS, 2016 WL 6246763, at *3 (D. Del. Oct. 25, 2016). No. 15-1720, 2017 U.S. Dist. LEXIS 19815, at *11 (E.D. La. Feb. 13,
19. Compare Robern, Inc. v. Glasscrafters, Inc., 206 F. Supp. 3d 2017) (criticizing this approach because it “resembles the minimal
1005, 1011 (D.N.J. 2016) (“[A]fter-the-fact disclosures cannot be requirements of now-defunct Form 18”).
OneandCrack
an
“Evisceration”
By Louis T. Perry and Katie A. Feiereisel
The Current State of

the DMCA’s Safe Harbor
he Digital Millennium Copyright Act (DMCA) has long frus-
T trated content owners by providing a broad safe harbor to

Internet service providers (ISPs), making it extremely dificult
for a content owner to meaningfully enforce its copyrights.
Content owners have long (and unsuccessfully) argued that
ISPs must take responsibility for infringing material on their serv-
ers. ISPs have long (and successfully) argued that they are merely
an informational conduit and can avoid monetary liability provided
Photo: iStockPhoto
September/October 2017 n LANDSLIDE 27
that they maintain this (semi) passive role. ISPs point to their posted on an ISP’s website.2 What constitutes this “something
compliance with 17 U.S.C. § 512, which covers infringement more” has not been extensively explored. But courts are clear that
claims that arise “by reason of the storage at the direction of to have the right and ability to control infringing activity, an ISP
a user of material that resides on a system or network con- must exert “substantial inluence” on user activity.3
trolled or operated by or for the service provider.” The § 512 The following (rather extreme) facts have been found to evi-
safe harbor protects an ISP if the ISP: dence an ISP’s right and ability to control infringing activity:
1. has no actual knowledge of speciic infringing material; • A monitoring program by which user websites received
2. is not aware of facts or circumstances from which detailed instructions regarding issues of layout, appear-
infringing activity is apparent; ance, and content, and under which the ISP forbade
3. acts expeditiously to remove or disable access to known certain types of content and refused access to users who
infringing material; failed to comply with its instructions.4
4. designates an agent to receive notiications of claimed • Facts that would support a inding of inducement of copy-
infringement; right infringement under Metro-Goldwyn-Mayer Studios,
5. receives no inancial beneit directly attributable to the Inc. v. Grokster, Ltd.,5 which premises liability on purpose-
infringing activity and has the right and ability to con- ful, culpable expression and conduct. Such facts include
trol such activity; and an ISP’s organization of infringing torrent iles on its web-
6. adopts and implements a policy terminating repeat site and the provision of personal assistance to users who
infringers. could not ind certain material likely to be infringing.6
The practical effect of § 512 is that content owners often • Evidence of active control over the production and
ind themselves engaged in a no-win game of whack-a-mole shipment of at least some infringing items for sale on
with infringing content. For every 10 instances where infring- an ISP’s platform.7
ing content is removed, 20 new instances arise. Rather than In cases against ISPs such as YouTube, Vimeo, and Veoh,
continually monitor sites and send numerous infringement however, numerous courts have found the “something more”
notiications to ISPs, some content providers sue the ISPs required by the DMCA lacking. On remand from the Second
directly. The results have been largely predictable: the DMCA’s Circuit, the district court in Viacom International, Inc. v. You-
safe harbor protects ISPs from monetary liability. While the Tube, Inc. decided that YouTube lacked the right and ability
bedrock of protection for ISPs remains strong, cracks are to control within the meaning of § 512(c) because
beginning to form as a result of the natural evolution of ISPs
and the tendency of some to push the limits of acceptable [t]here is no evidence that YouTube induced its users to sub-
behavior proscribed by § 512(c). These cracks have not often mit infringing videos, provided users with detailed instructions
resulted in liability to a particular ISP, but when they do (as it about what content to upload or edited their content, prescreened
happened in the recent Second Circuit decision EMI Christian submissions for quality, steered users to infringing videos, or oth-
Music Group, Inc. v. MP3tunes, LLC1—which was labeled an erwise interacted with infringing users to a point where it might
“evisceration” by some critics), the copyright world sits upright be said to have participated in their infringing activity.8
and takes notice. This article examines one such crack and the
Second Circuit’s supposed evisceration. In Capitol Records, LLC v. Vimeo, LLC,9 Vimeo utilized an
employee-implemented monitoring program, the foundation of
Finding the Elusive “Something More” which is its “Terms of Service” and “Community Guidelines,”
Content providers often seize upon the ISP’s business model and which included approximately 40 moderator tools including:
as a chink in its defense—clearly an ISP beneits inancially • The “Thin Ice” and “Wiretap” tools, which allow Vimeo
from the material it transmits (infringing and otherwise). to monitor the activities of speciic users suspected of
Were it any different, why would the ISP even exist? And uploading content violative of Vimeo’s policies;
it’s equally clear that an ISP has the right and ability to con- • The “Sweet Spot” iltering tool, which searches for
trol infringing activity. If this is not so, then what purpose and lists videos the duration of which Vimeo has
does designating a copyright agent to receive notiication of determined corresponds to the duration of uploaded
infringement claims (and subsequently removing or blocking television shows or movies; and
access to infringing material) serve? • The “Movie Search” tool, which runs automated key-
The matter, however, is not so simple. Under the DMCA, the word searches for movies currently in theaters.
“right and ability to control” infringing activity requires “some- Vimeo had “signiicant discretion” to manipulate the visibil-
thing more” than the ability to remove or block access to materials ity of videos that complied with Vimeo’s content restrictions.
The district court concluded that Vimeo’s monitoring program
Louis T. Perry is a partner at Faegre Baker Daniels LLP and a “lacks the ‘something more’ that Viacom demands.”10 The
member of the irm’s trademark, copyright, advertising, and media court’s decision turned largely on its determination that Vimeo
(T-CAM) practice. His area of expertise is litigation. He can be reached “does not purport to, and in practice does not, exert substantial
at louis.perry@faegrebd.com. Katie A. Feiereisel is an associate at inluence over the content of the uploaded material.”11 Rather,
the same irm, where she focuses her practice on intellectual property “Vimeo leaves such editorial decisions in the hands of its
litigation involving trademarks, false advertising, copyrights, and patents. users.”12 The court also focused on Vimeo’s staff-to-user ratio,
She can be reached at katie.feiereisel@faegrebd.com. and noted that “it is dificult to imagine how Vimeo’s staff of
seventy-four (as of 2012) could, through its discretionary and the Internet for free music and offered users a plug-in that
sporadic interactions with videos on the Website, exert substan- allowed them to “download” that music to their virtual
tial inluence on approximately 12.3 million registered users MP3tunes locker—a process also referred to as “sideload-
uploading 43,000 new videos each day.”13 ing.” Once a song was sideloaded, it was indexed and made
The Second Circuit considered the matter on interloc- available for other sideload.com users to stream, download,
utory appeal. Speciically, it addressed whether an ISP’s or sideload into their own virtual MP3tunes lockers.18
viewing of “user-generated video containing all or virtu- EMI Christian Music Group, along with a variety of music
ally all of a recognizable, copyrighted song may establish publishers and record companies, sued MP3tunes alleg-
‘facts or circumstances’ giving rise to ‘red lag’ knowledge of ing that it had violated thousands of copyrights. MP3tunes
infringement.”14 The Second Circuit found that it did not: argued that the DMCA’s safe harbor provisions shielded it
from liability. The plaintiffs argued, among other things, that
A copyright owner’s mere showing that a video posted by a MP3tunes failed to implement the required repeat infringer
user on the service provider’s site includes substantially all policy and ignored red lags of widespread infringement.
of a recording of recognizable copyrighted music, and that an The district court held that MP3tunes had reasonably imple-
employee of the service provider saw at least some part of the mented a repeat infringer policy and granted it summary
user’s material, is insuficient to sustain the copyright owner’s judgment on this point, but ultimately allowed the issue of
burden of proving that the service provider had either actual MP3tunes’ willful blindness to the rampant infringement as
or red lag knowledge of the infringement.15 a question of fact for the jury. The jury found MP3tunes sec-
ondarily liable for copyright infringement and awarded the
Finally, in UMG Recordings, Inc. v. Veoh Networks, Inc., the plaintiffs approximately $48 million, but this verdict was later
Ninth Circuit determined that the following facts did not rise partially vacated and reduced by the district court. An appeal
to the level of “substantial inluence”: (1) the allegedly infring- to the Second Circuit followed.19
ing material resided on Veoh’s system; (2) Veoh had the ability The Second Circuit began with a simple question: what
to remove such material; (3) Veoh could have implemented, is a repeat infringer? The DMCA leaves the term undeined.
and did implement, iltering systems; and (4) Veoh could have The district court had held that a user can only be a repeat
searched for potentially infringing content.16 infringer if that user knows that its conduct is infringing
The courts make one thing clear about the elusive “some- another’s copyright. Thus, according to the district court, only
thing more”—a content owner is unlikely to ind it without those who upload content can be repeat infringers. By con-
(1) an egregious fact pattern, or (2) targeted and comprehen- trast, users who sideload content to their virtual MP3tunes
sive (and expensive) discovery efforts. Deciding to litigate locker or stream infringing content do not know whether the
against an ISP requires signiicant inancial commitment or, material violates the copyrights of others.20
as is the case below, a coalition of aggrieved plaintiffs. The Second Court disagreed, inding that a repeat infringer
need not have any knowledge of the copyright status of a
Redeining Repeat Infringers certain work. All that is required is repeated uploading and
Section 512(i) of the DMCA requires that an ISP “adopt[] downloading of copyrighted material. The district court’s sum-
and reasonably implement[] . . . a policy that provides for mary judgment ruling, then, was improper, because “MP3tunes
the termination in appropriate circumstances of subscribers did not even try to connect known infringing activity of which
and account holders of the service provider’s system or net- it became aware through takedown notices to users who repeat-
work who are repeat infringers.” Most ISPs do have a repeat edly created links to that infringing content in the sideload.com
infringer policy—that is, they have a policy whereby prob- index or who copied iles from those links.”21
lem accounts are lagged and removed when the ISP receives That practical effect of this ruling—that MP3tunes should
multiple infringement notiications tied to such accounts. have “tried” to connect takedown notices to users—may not seem
Because the DMCA does not deine “repeat infringer,” ISPs terribly burdensome at irst glance. After all, many ISPs have a
have long construed the term in the context of infringement framework for terminating repeat infringers, and it is easy enough
notiications. But the Second Circuit recently upended that in to lag an account that is the subject of a takedown notice. But in
EMI Christian Music Group, Inc. v. MP3tunes, LLC.17 this particular instance, the court seems to suggest that MP3tunes
MP3tunes has alternatively been dismissed as a product of not only should have maintained a dossier on users who uploaded
its own egregious fact pattern (featuring owners who knowingly infringing links, but also should have tracked all users who sub-
participated in infringement) and an evisceration of the DMCA sequently copied the ile underlying an infringing link and also
(by those same owners and some prominent commentators). It tracked those users for future activity subject to a notice. The mag-
will be some time before it is clear which characterization proves nitude of this undertaking not only is staggering, but it also seems
true, but the case bears examination and careful consideration. at odds with another provision of the DMCA that relieves ISPs of
MP3tunes.com was launched in 2005 as an online plat- the burden of afirmatively monitoring their users.22
form that allowed customers to purchase music created by It remains to be seen how other circuits will handle
musicians unrepresented by a record label. Shortly thereaf- attacks on ISPs based on the repeat infringer provision of the
ter, it added “locker storage,” which allowed users to store DMCA,23 but the Second Circuit has laid the groundwork for
music on the site’s server in exchange for a fee. MP3tunes a sea change in ISP liability.
also owned sideload.com, a site that allowed users to comb Continued on page 58
Intellectual Property
Suits in the United States
Court of Federal Claims
By Judge Mary Ellen Coster Williams
and Diane E. Ghrist
Illustration: iStockPhoto
K
nown as “the People’s Court,” the US Court of restricting the government’s use.7 Congress styled the 1910 Act
Federal Claims (USCFC) was created by Con- under the theory of eminent domain, as the government’s taking
gress as a forum for suits against the government of a license to use a patented invention would be for the bene-
for monetary damages. The USCFC consists of 16 it of the public.8 As stated in Calhoun v. United States, “when a
judges appointed by the president and conirmed patented device or invention is made or used by or for the United
by the US Senate for terms of 15 years. Appeals States, [the government] ipso facto takes by eminent domain
from the USCFC are resolved by the US Court of a compulsory compensable license in the patent; the patentee
Appeals for the Federal Circuit. The USCFC is obtains his Fifth Amendment just compensation for that taking
unique in the federal trial court system in that it has through his action [in the USCFC] under § 1498.”9
nationwide jurisdiction, and hears a variety of claims against But the 1910 Act proved to be unworkable after the
the US government for money damages, including patent and Supreme Court, in William Cramp & Sons Ship & Engine
copyright infringement, government contract disputes, Fifth Building Co. v. International Curtis Marine Turbine Co., held
Amendment takings, tax refund claims, tribal claims, military that a contractor could be found liable for patent infringement
and civilian personnel cases, and Vaccine Act appeals. in connection with its performance of work for the govern-
The government has expressly waived its sovereign immu- ment.10 The Court reasoned that a contractor with the United
nity and consented to be sued for patent infringement under 28 States is “bound to discharge the obligation of his contract
U.S.C. § 1498(a) and copyright infringement under 28 U.S.C. without violating the rights of others.”11 The Court continued
§ 1498(b). With the government’s use of intellectual prop- that a mere contract with the United States does not vest a
erty (IP) steadily increasing, the USCFC has seen a rise in both contractor with the “power to take the property of others upon
infringement actions and peripheral IP issues in the contract the assumption that as a result of the contract with the United
arena.1 This article outlines the USCFC’s jurisdiction in IP cases, States he enjoys the right to exercise public and governmental
tracing its historical and legislative roots, and addresses some powers possessed by the United States.”12 The William Cramp
unique features of IP litigation in this forum, including jurisdic- decision opened the door for patent owners to sue federal
tion, third-party practice, indemniication, and remedies. contractors and subject them to the harsh remedies of injunc-
tions and punitive treble damages available in district court.13
Eminent Domain and Taking Patent Licenses The Supreme Court decided William Cramp on March 4,
On June 25, 1910, Congress passed “An Act to provide addi- 1918, in the midst of World War I. The decision immedi-
tional protection for owners of patents of the United States” ately deterred contractors from working with the government
(1910 Act), stating in pertinent part: for fear of protracted litigation, which in turn hampered the
government’s ability to procure patented inventions.14 These
That whenever an invention described in and covered by a undesirable effects prompted the Acting Secretary of the
patent of the United States shall hereafter be used by the Navy, Franklin D. Roosevelt, to write a letter to Congress
United States without license of the owner thereof or law- immediately requesting the 1910 Act be amended to pro-
ful right to use the same, such owner may recover reasonable tect contractors from litigation. Within four months, Congress
compensation for such use by suit in the Court of Claims.2 passed the 1918 version of the Government Use Statute that
clariied the government’s assumption of liability for a contrac-
Prior to the 1910 Act, the Supreme Court considered patent tor’s unlawful use or manufacture of a patented invention and
infringement to be a tort claim for which the government had limited a plaintiff’s sole remedy to monetary compensation.15
not waived sovereign immunity.3 The Court of Claims4 heard Section 1498(a) took its present form in 1949, and retains
some suits involving allegations of patent infringement on a the bedrock principles established in 1910 and 1918 of
breach of contract theory if there was proof of a contract obli- (1) deining the government’s unlawful use or manufacture of
gating the government to pay the patent owner.5 The Supreme patented articles as a Fifth Amendment taking of a license to
Court, however, recognized this situation to be an “injustice . . . use a patented invention, (2) providing government contractor
as applied to rights of the character of those embraced by pat- immunity from patent infringement litigation, and (3) lim-
ents, because of the frequent possibility of their infringement iting available remedies to monetary damages.16 Section
by the acts of [government] oficers under circumstances which 1498(a) provides in pertinent part:
would not justify the implication of a contract.”6
Dubbed the “Government Use Statute,” the 1910 Act created Whenever an invention described in and covered by a patent of
a means for patent owners to obtain money damages for the gov- the United States is used or manufactured by or for the United
ernment’s use of patented inventions while at the same time not States without license of the owner thereof or lawful right to use
Judge Mary Ellen Coster Williams was appointed to the United States Court of Federal Claims (USCFC) in 2003. Prior to serving on
the USCFC, Judge Williams served as an administrative judge on the General Services Administration Board of Contract Appeals, worked
in private practice, and was an assistant United States attorney in the District of Columbia in the civil division. Judge Williams has taught
intellectual property law, government contracts, and numerous courses on civil litigation, including litigation with the federal government.
Diane E. Ghrist served as a judicial law clerk to Judge Williams from August 2015 through March 2017, and she is currently serving as a
judicial law clerk to Judge Jimmie V. Reyna, on the United States Court of Appeals for the Federal Circuit. The views expressed in this article
are the personal views of the authors and should not be attributed to the court. This article is not citable as precedent.
or manufacture the same, the owner’s remedy shall be by action jurisdiction over infringement actions must be linked to the
against the United States in the United States Court of Federal government’s taking of a patent license through its “use or
Claims for the recovery of his reasonable and entire compensa- manufacture” of the patented invention “without license of
tion for such use and manufacture. . . . For the purposes of this the owner thereof or lawful right.”24 In contrast, the Patent
section, the use or manufacture of an invention described in Act—the statutory basis that governs the processes for issu-
and covered by a patent of the United States by a contractor, a ing and enforcing patents before the United States Patent and
subcontractor, or any person, irm, or corporation for the Govern- Trademark Ofice (USPTO) and the district courts—deines
ment and with the authorization or consent of the Government, patent infringement as a statutory tort in 35 U.S.C. § 271.25
shall be construed as use or manufacture for the United States.17 Section 271(a) of the Patent Act provides: “whoever with-
out authority makes, uses, offers to sell, or sells any patented
As in the early days of the Government Use Statute, most invention, within the United States or imports into the United
patent infringement actions under § 1498(a) today center on States any patented invention during the term of the patent
wartime and national security needs. Other suits involve govern- therefor, infringes the patent.” In contrast, § 1498(a) only ref-
ment-dominated research areas such as outer space exploration.18 erences patented inventions “used or manufactured by or for
The USCFC’s patent infringement actions mirror those the United States” as potentially infringing acts. The relation-
in district court, but the USCFC exclusively holds bench tri- ship between infringement as a tort under the Patent Act and
The relationship between

infringement as a tort under the
Patent Act and infringement as
a Fifth Amendment taking under
§1498(a) remains a hotly litigated
topic before the USCFC.
als, and government contractors are frequently third-party infringement as a Fifth Amendment taking under § 1498(a)
defendants. Like in district court, the USCFC typically holds remains a hotly litigated topic before the USCFC.26
a Markman19 hearing on claim construction before hearing In Decca Ltd. v. United States, the Court of Claims inter-
infringement and validity.20 However, validity may only be preted § 1498 to mean that the government consented to be
raised as an afirmative defense to infringement and not as a sued for damages stemming from direct infringement by con-
counterclaim.21 Several judges on the USCFC use the local senting to suits for its “taking of a patent license,” because
rules of the Northern District of California and modify those § 1498(a) does not give rise to government liability for
rules to comport with § 1498.22 In addition, the USCFC has a activities “which fall short of direct infringement,” includ-
user-friendly alternative dispute resolution program that facili- ing induced and contributory infringement, which contain
tates the settlement of infringement actions before the court.23 intent requirements.27 In Zoltek III, the Federal Circuit further
narrowed § 1498 by holding that direct infringement under
Scope of Section 1498(a) § 1498(a) with respect to the United States’ use or manu-
As § 1498(a) infringement actions are grounded in eminent facture of a patented invention was predicated on § 271(a)
domain and not deined by statute, the scope of what con- of the Patent Act.28 Thus, other deinitions of infringement
stitutes the unlawful taking of a license to use a patent is under § 271, such as the importation of an infringing product
a creature of case law. As such, the basis for the USCFC’s under § 271(g), were not causes of action available for patent
owners in suits against the government under § 1498. § 1498(a) must be tied to the patent grant under 35 U.S.C.
However, in the 2012 en banc decision Zoltek V, the Federal § 154, the decision left open questions regarding the full
Circuit abrogated Zoltek III, holding that establishing conduct extent of § 1498(a)’s waiver of sovereign immunity.
falling within the deinition of direct infringement codiied in
35 U.S.C. § 271(a) is not a predicate to inding infringement Government Contractor Immunity
under § 1498(a). Instead, the court concluded that the scope of Underlying the government’s assumption of liability for pat-
§ 1498(a) is “linked to the scope of the patent holder’s rights as ent infringement under § 1498(a) is the recognition that
granted by the patent grant in title 35 U.S.C. section 154(a)(1).”29 government contractors are immune from any type of pat-
In contrast to the statutory deinitions of infringement in § 271, ent infringement claim in district court. Congress amended
§ 154(a)(1) deines the patent grant issued by the USPTO as: § 1498(a) in 1918, at the behest of the Secretary of the Navy
to expressly provide for government contractor immunity.
the right to exclude others from making, using, offering for sale, The statute is clear in providing that “the use or manufacture
or selling the invention throughout the United States or importing of an invention described in and covered by a patent of the
the invention into the United States, and, if the invention is a pro- United States by a contractor, a subcontractor, or any person,
cess, . . . the right to exclude others from using, offering for sale irm, or corporation for the Government and with the autho-
or selling throughout the United States, products made by that rization or consent of the Government, shall be construed
process, referring to the speciication for the particulars thereof.30 as use or manufacture for the United States.”38 The purpose
behind this amendment was to enable the government to pro-
The Federal Circuit thus reverted to its pre–Zoltek III posi- cure patented inventions without judicial interference, a goal
tion that a § 1498 action is parallel to a title 35 action and not that was achieved by barring infringement actions against
predicated on the statutory deinitions of infringement listed contractors. Under the plain language of the statute, there are
in § 271 of the Patent Act.31 two elements a contractor must satisfy for the government to
In Zoltek V, the appellate court emphasized that § 1498(a) assume liability under § 1498(a). First, a contractor’s use or
is “its own independent cause of action” with three ele- manufacture of the invention must be “for the government,”
ments to trigger government liability: (1) the invention must and second, the contractor must have the “authorization or
be claimed in a patent; (2) it must be “used or manufactured consent of the government” for that use or manufacture.
by or for the United States,” meaning each limitation of the
claims must be present in the accused product or process; “For the Government”
and (3) the “use or manufacture” of the patented invention In Advanced Software Design Corp. v. Federal Reserve Bank of
must be done without license or lawful right—i.e., “use of St. Louis, the Federal Circuit interpreted the term “for the gov-
an invention that, if done by a private party, would directly ernment” to mean that the government derives a beneit from
infringe the patent.”32 In applying these three requirements, the use or manufacture of the patented technology.39 For exam-
the Zoltek court found that a government contractor’s impor- ple, the patented technology itself must be used “in furtherance
tation into the United States of a product made by a patented and fulillment of a stated Government policy,” which would
process for use by the government fell within the scope of serve the government’s interest, for the government’s beneit.40
§ 1498(a)’s waiver of sovereign immunity because a private In contrast, if the government simply has an “interest in the pro-
party would be liable for direct infringement for such use of gram generally, or funds or reimburses all or part of its costs,”
the imported product under 35 U.S.C. §§ 154 and 271(g).33 that interest is too remote to support a inding of a government
The Federal Circuit further stated that “[a]s the patent beneit.41 In other words, the government’s mere funding of an
grant has expanded over the years, so too has the coverage infringing activity does not establish that such activity is “for the
of § 1498(a),” suggesting that any statutory changes to the government” within the meaning of § 1498(a).
patent grant under 35 U.S.C. § 154(a)(1) will have a cor-
responding effect on the scope of § 1498(a).34 As such, the “Authorization or Consent”
Federal Circuit has recognized that § 1498(a) extends to The government’s authorization of or consent to a contractor’s
actions “recognized as being deined by § 271(a)”35 as well infringing activity may be express or implied.42 Federal Acqui-
as the importation of an infringing product or product made sition Regulation (FAR) 52.227-1 contains an express grant
by an infringing process under § 271(g). However, the Fed- of “authorization and consent” for contractors and subcon-
eral Circuit has not determined whether the other types of tractors for the use and manufacture of any patented invention
infringement deined in 35 U.S.C. § 271(b), (c), and (f) (1) embodied in the structure or composition of any article deliv-
fall within the scope of actions under § 1498.36 Walking ered to and accepted by the government related to a government
back Decca, the Zoltek V court hinted at the possibility that contract; or (2) used in machinery, tools, or methods necessary
§ 1498(a) may extend to acts “recognized as being” deined for a contractor to comply with the speciications of a contract,
as induced infringement under § 271(b) and contributory or if such use is directed by a contracting oficer’s speciic writ-
infringement under § 271(c), as well as infringement under ten instructions.43 The FAR also requires a contractor to report
§ 271(f), which deines an act of infringement to be expor- “promptly and in reasonable written detail” to the contracting
tation of product components that, when combined abroad, oficer any claim of patent infringement of which the contractor
would infringe a patent if the product were to be combined has knowledge based on the performance of a contract.44
in the United States.37 In sum, while Zoltek V clariied that To succeed on an implied authorization theory there must
be some explicit government action, such as a contract- contractor “as soon as practicable” of the pending action, the
ing oficer’s instruction, or evidence extrinsic to the contract government cannot invoke the FAR’s patent indemnity provi-
language showing the government’s intention to assume sion against a contractor.
liability.45 In Larson v. United States, the Claims Court rec- To participate in its defense, a contractor may opt to join
ognized that implied authorization “may be found under the § 1498(a) litigation as a third-party defendant. Under Rule
the following conditions: (1) the government expressly 14(b) of the Rules of the United States Court of Federal Claims
contracted for work to meet certain speciications; (2) the (RCFC), the court “may notify any person with the legal capac-
speciications cannot be met without infringing on a patent; ity to sue or to be sued who is alleged to have an interest in
and (3) the government had some knowledge of the infringe- the subject matter of the suit.” Further, a “person served with a
ment.”46 The purpose behind permitting the government’s notice issued . . . may ile an appropriate pleading setting forth
authorization or consent to be implied is tied to the govern- the person’s interest in the subject matter of the litigation.”55
ment’s need to procure items without disruption,47 and avoid In resolving a petition for mandamus, the Federal Circuit held
the need for government agencies to perform an exhaustive in In re UUSI, LLC, that a third party’s potential obligation to
patent search for products or services they wish to procure. indemnify the government for any patent infringement liability
For example, in TVI Energy, the Federal Circuit found provides “suficient interest in litigation to offer evidence and
implied authorization or consent where the government required advance legal arguments appropriate to protect its own inter-
a contractor to demonstrate an allegedly infringing device ests.”56 The Federal Circuit noted, however, that a third-party
as part of bidding requirements under a United States mili- defendant cannot assert any counterclaims against a plaintiff,
tary solicitation for disposable thermal targets.48 Following the as such claims would result in litigation between private parties
demonstration, one bidder/patent owner, TVI Energy, sued a and “impermissibly exceed[] the scope of the Court of Federal
competing bidder, Blane, for patent infringement. Blane asserted Claims’ limited jurisdiction.”57
immunity under § 1498(a), despite having no express letter of While a contractor need not participate in the § 1498 liti-
consent or authorization from the government to infringe any gation, contractors should be aware that failure to appear in
patent. The Federal Circuit nevertheless found implied autho- response to a notice under Rule 14(b) acts as a waiver of any
rization, stating that “[t]o limit the scope of § 1498 only to later argument that the contractor should not indemnify the
instances where the Government requires by speciication that a government on grounds that the USCFC incorrectly decided
supplier infringe another’s patent would defeat the Congressio- the patent was valid and infringed. As the USCFC held in
nal intent to allow the Government to procure whatever it wished Bowser, Inc. v. United States:
regardless of possible patent infringement.”49 Courts have often
found a contractor, through the government’s implied authoriza- We think there is implicit in the whole plan and purpose of
tion, to be immune from suit from the time it offers to supply or Subsection 14(b) a congressional intent that the issues of fact
begin to manufacture products for the government.50 and law decided in a suit against the United States in the Court
If these two elements—acting “for the government” with of Claims may not be retried in another court at the insistence
its “authorization or consent”—are met, then a contractor who of a third party, who had a “possible” interest in the case in
infringes a patent in the course of its performance of work for this court but who failed to appear and protect his interest after
the government, under any deinition of infringement in § 271 timely notice or summons had been served upon him.58
of the Patent Act, is shielded from liability. In this respect,
§ 1498(a) serves as an afirmative defense available to gov- Available Remedies
ernment contractors in patent infringement actions in district Under § 1498(a), a patent owner who successfully proves
court.51 Correlatively, where the government has assumed a infringement is entitled to “reasonable and entire” compen-
contractor’s liability, a patent owner can seek judicial relief by sation. Like the deinition of infringement, the remedies
iling suit against the government in the USCFC.52 available to a patentee are limited by § 1498(a)’s roots in
eminent domain, not tort.59 In takings jurisprudence, “[t]he
Indemniication proper measure in eminent domain is what the owner has lost,
The FAR’s patent indemnity provision provides that a contractor not what the taker has gained,” and in § 1498(a) what is taken
from the patent owner is a compulsory nonexclusive license
shall indemnify the Government and its oficers, agents, and to use or manufacture the patented invention.60 As such, in
employees against liability, including costs, for any infringement § 1498 actions, “reasonable and entire compensation” is the
of any United States patent . . . arising out of the manufacture or exclusive remedy for patent infringement under § 1498(a) and
delivery of supplies, the performance of services, or the construc- is akin to just compensation under the Fifth Amendment of
tion, alteration, modiication, or repair of real property . . . or out the Constitution. In contrast, under the Patent Act, damages
of the use or disposal by or for the account of the Government of are measured as either lost proits or a reasonable royalty, i.e.,
such supplies or construction work.53 the amount for which the patent owner would be willing to
license the patent, based on a hypothetical licensing negotia-
Under the FAR, the government must inform the con- tion between the patent owner and accused infringer.61
tractor “as soon as practicable” of any action for patent The Court of Claims explained that “reasonable and entire
infringement so that the contractor has an opportunity to par- compensation” has two components related to a takings analy-
ticipate in its defense.54 If the government fails to inform a sis: the irst is to determine the value of the license at the time it
was taken by the government, and the second involves compen- by the Government.” The patent owner can either enter into
sating for the government’s delay in paying for that license.62 To a settlement agreement with the government to obtain this
calculate the damages related to these two components, the Court compensation, seek additional compensation beyond the settle-
of Claims has recognized three methods of valuation of the irst ment agreement in the USCFC or district court, or wait until
component, license value: (1) determination of a reasonable roy- the patent issues and “bring suit in the United States Court of
alty for the license; (2) awarding a percentage of government cost Federal Claims for just compensation for the damage caused
savings arising from governmental use of the patented invention; by reason of the order of secrecy and/or use by the Govern-
or (3) awarding lost proits.63 In Decca, the Court of Claims recog- ment of the invention resulting from his disclosure.”70 In such
nized that the determination of a reasonable royalty is the preferred Invention Secrecy Act cases, the USCFC remanded cases to
method of valuation, applying the same case law as in district administrative agencies to pursue settlement agreements with
court patent infringement actions. Indeed, where the patent owner patent owners.71 In iscal year 2016, the USPTO, in response
has commercially licensed its patent on terms that are the “same to a Freedom of Information Act request, reported that 5,680
or substantially similar to the rights taken by the Government,” patents and patent applications are subject to secrecy orders,
the USCFC uses “virtually, without exception, the reasonable roy- largely requested by the Army, Navy, and Air Force.72
the government’s mere funding

of an infringing activity does
not establish that such activity
is “for the government.”
alty method to value the license taken by the Government.”64 For Copyright: Section 1498(b)
the second component of delay compensation, the court multiplies Section 1498(b) governs the government’s use of copyrighted
any accrued royalty based on the initial license value by an annual works:
percentage rate determined on a case-by-case basis.65
Injunctive relief is not available as a primary remedy. The Hereafter, whenever the copyright in any work protected under
prospect of government contractors being subject to an injunc- the copyright laws of the United States shall be infringed by
tion would disrupt the government’s ability to procure its needed the United States, by a corporation owned or controlled by the
supplies and services.66 The USCFC may, however, issue equita- United States, or by a contractor, subcontractor, or any per-
ble relief that is ancillary to monetary damages. For example, the son, irm, or corporation acting for the Government and with
court may set aside the assignment of a patent to the government the authorization or consent of the Government, the exclusive
where the assignment was unlawful in conjunction with a plain- action which may be brought for such infringement shall be an
tiff’s claim for monetary relief under § 1498(a).67 However, the action by the copyright owner against the United States in the
term “entire” in § 1498(a) bars any option for a patent owner to Court of Federal Claims for the recovery of his reasonable and
obtain punitive damages against the government.68 entire compensation as damages for such infringement, includ-
Another wrinkle to § 1498 jurisprudence is the option to ing the minimum statutory damages as set forth in section
obtain damages for the government’s use of a patent prior 504(c) of [the Copyright Act].73
to its issuance or prior to its application’s publication pursu-
ant to required withholding under the Invention Secrecy Act, Under § 1498(b), federal employees may bring actions
35 U.S.C. §§ 181–188. The Invention Secrecy Act permits the against the government except where: (1) the employee “was in
government to notify the commissioner of patents to withhold a position to order, inluence, or induce use of the copyrighted
“publication of the [patent] application or the grant of a pat- work by the Government”; or (2) the copyrighted work “was
ent” if the publication or disclosure of a patent application or prepared as a part of the oficial functions of the employee, or in
patent might be “detrimental to the national security.”69 Section the preparation of which Government time, material, or facilities
183 of the Invention Secrecy Act provides a right to compen- were used.” In Blueport Co. v. United States, the Federal Circuit
sation beginning “on the date of the irst use of the invention held that these irst two provisos are jurisdictional requirements
and act as a limit on the scope and application of § 1498(b).74 was acquired, including use at any government installation to
Section 1498(b) also contains a third provision that before il- which the computer(s) may be transferred; (2) used or copied
ing an action in the USCFC, the head of a government agency for use with a backup computer if any computer for which it
or a corporation owned or controlled by the states can enter into was acquired is inoperative; (3) reproduced for safekeeping
a settlement agreement with the copyright owner and “settle the or backup purposes; (4) modiied, adapted, or combined with
claim administratively out of available appropriations.” other computer software; (5) disclosed to and reproduced for
At irst blush, there are a number of similarities between use by support service contractors or their subcontractors; and
copyright infringement actions under § 1498(b) and patent (6) used or copied for use with a replacement computer.82 n
To succeed on an implied
authorization theory,there must be
some explicit government action.
infringement actions under § 1498(a). As with patent infringe- Endnotes
ment, the government can only be subjected to monetary 1. See, e.g., Am. Safety Council, Inc. v. United States, 122 Fed.
damages in the form of “reasonable and entire compensa- Cl. 426, 436 (2015) (preaward bid protest inding technical data
tion.”75 Infringement of a copyright by a contractor must be rights clauses in solicitation unduly restrictive); Allied Tech. Grp.,
“for the government” with the “authorization or consent” of Inc. v. United States, 94 Fed. Cl. 16, 38 (2010) (upholding rejec-
the government in order to confer jurisdiction on the USCFC. tion of the plaintiff’s quotation, where the plaintiff conditioned its
There are also some stark differences between subsections (a) offer on the government’s acceptance of data rights provisions that
and (b). Unlike § 1498(a), which makes no reference to the conlicted with the solicitation); FN Mfg., Inc. v. United States, 44
term “patent infringement,” the cause of action under § 1498(b) Fed. Cl. 449, 451–52 (1999) (upholding award of a sole source sup-
is explicitly called “infringement,” implicating the deinition of ply contract, where proprietary data rights precluded competitive
infringement under 17 U.S.C. § 106.76 procurement); Authentic Apparel Grp., LLC v. United States, No.
Moreover, unlike patents that are exclusively a federal 15-16C (Fed. Cl. iled Jan. 6, 2015) (claiming breach of a trademark
government property grant, there are two sources of copy- licensing agreement). In an appeal of a USCFC decision on claim
right grants: the Copyright Act codiied in title 17 of the construction, Liberty Ammunition, Inc. v. United States, 835 F.3d
United States Code and state common law. Under § 1498(b), 1388, 1401–02 (Fed. Cir. 2016), the Federal Circuit found a nondis-
the government has only waived sovereign immunity with closure agreement (NDA) unenforceable because the government
respect to works “protected under the copyright laws of the oficial who entered into the NDA lacked the requisite authority to
United States,” meaning under the copyright laws codiied in bind the government. Judge Newman dissented.
title 17.77 A copyright owner is subject to certain restrictions 2. 36 Stat. 851 (1910).
in the Copyright Act, most signiicantly the requirement that 3. Schillinger v. United States, 155 U.S. 163, 169 (1894) (“That
the copyright be registered with the Copyright Ofice before this action is one sounding in tort is clear. It is in form one to recover
bringing suit as set forth in 17 U.S.C. § 411(a).78 damages. The petition charges a wrongful appropriation by the gov-
The USCFC has also seen copyright infringement actions ernment, against the protest of the claimants, and prays to recover
related to software.79 While software can be either patented the damages done by such wrong.”).
or copyrighted, the FAR contains mandatory rights that a 4. The Court of Claims is the predecessor to the Federal Circuit, and
software license agreement must confer on the government, its body of case law prior to 1982 is binding precedent in the USCFC.
“[n]otwithstanding any contrary provisions contained in the 5. Crozier v. Fried. Krupp Aktiengesell-schaft, 224 U.S. 290, 304
Contractor’s standard commercial license.”80 These FAR pro- (1912).
visions are sweeping, and may be fatal to a claim of either 6. Id.
patent or copyright infringement before the USCFC.81 FAR 7. W.L. Gore & Assocs., Inc. v. Garlock, Inc., 842 F.2d 1275,
52.227-19(b) provides that the “commercial computer soft- 1283 (Fed. Cir. 1988) (“The patentee takes his patent from the
ware” delivered pursuant to a government contract “may United States subject to the government’s eminent domain rights
not be used, reproduced, or disclosed by the Government,” to obtain what it needs from manufacturers and to use the same.”),
except that the commercial computer software may be: abrogated on other grounds by eBay Inc. v. MercExchange, L.L.C.,
(1) used or copied for use with the computer(s) for which it 547 U.S. 388, 391–94 (2006).
8. Crozier, 224 U.S. at 305 (“[I]n view of the public nature of the (2016) (reaching the issue of validity raised as an alternative afir-
subjects with which the patents in question are concerned and the mative defense to infringement).
undoubted authority of the United States as to such subjects to exert 22. See, e.g., Scheduling Order, Bondyopadhyay, No. 14-147C
the power of eminent domain, the statute, looking at the substance of (Fed. Cl. Feb. 10, 2017), ECF No. 198.
things, provides for the appropriation of a license to use the inven- 23. See, e.g., Joint ADR Status Report, Tritek Techs., Inc. v.
tion, the appropriation thus made being sanctioned by the means of United States, No. 14-451C (Fed. Cl. Dec. 23, 2015).
compensation for which the statute provides.”). 24. Decca Ltd. v. United States, 640 F.2d 1156, 1166–67 (Ct. Cl. 1980).
9. 453 F.2d 1385, 1391 (Ct. Cl. 1972). The takings clause of the 25. 35 U.S.C. § 271(a)–(c), (e)–(g); see also Decca, 640 F.2d at
Fifth Amendment states that “private property [shall not] be taken 1166 (“Because section 1498 authorizes the Government to take a
for public use, without just compensation.” U.S. Const. amend. V. license in any United States patent, the Government is never ‘guilty’
10. 246 U.S. 28, 42–43 (1918). of ‘direct infringement’ of a patent insofar as ‘direct infringement’
11. Id. at 43. connotes tortious or wrongful conduct.”). Before the enactment of
12. Id. § 1498, the government would routinely contest the Court of Claims’
13. See Zoltek Corp. v. United States (Zoltek V), 672 F.3d 1309, jurisdiction to hear patent actions, as such actions traditionally sound
1316 (Fed. Cir. 2012) (en banc) (“Now [following William Cramp], in tort. Sean M. O’Connor, Taking, Tort, or Crown Right?: The Con-
however, manufactures are exposed to expensive litigation, involv- fused Early History of Government Patent Policy, 12 J. Marshall
ing the possibilities of prohibitive injunction payments of royalties, Rev. Intell. Prop. L. 145, 165–67 (2012). The Supreme Court also
rending of accounts, and payment of punitive damages, and they are heard some congressional reference cases on the government’s patent
reluctant to take contracts that may bring such severe consequences. infringement. See, e.g., James v. Campbell, 104 U.S. 356, 357 (1882).
The situation promised serious disadvantage to the public inter- 26. Though not explored in this article, the scope of defenses
ests, and in order that vital activities of this department may not be available to the government is also a source of litigation. As a gen-
restricted unduly at this time, and also with a view of enabling dis- eral rule, the government is permitted to assert “all the defenses
satisied patentees to obtain just and adequate compensation in all available to a private party” under § 282 of the Patent Act, as well as
cases conformably to the declared purpose of said act, I have the laches, and the medical immunity defense under § 287(c). Pratt &
honor to request that the act be amended by the insertion of a proper Whitney Can. Inc. v. United States, 12 Cl. Ct. 221, 222–23 (1987)
provision therefore in the pending naval appropriation bill.” (quoting (“[The government] has allowed itself all the defenses available to
Roosevelt’s April 20, 1918, letter as it appears in Wood v. Atl. Gulf & a private party, even though the plaintiff cannot avail itself of all
Pac. Co., 296 F. 718, 720–21 (S.D. Ala. 1924))). the remedies available to a private party. Although this is indeed an
14. Id. (outlining the history of § 1498(a)). asymmetrical situation, that does not render it unjust. But it should
15. Act of July 1, 1918, Pub. L. No. 65-182, 40 Stat. 704, 705; be further noted that a determination as to the wisdom of a statute
Zoltek V, 672 F.3d at 1316. is not the function of a court.”); see also Avocent Redmond Corp. v.
16. Act of May 24, 1949, Pub. L. No. 81-72, § 87, 63 Stat. 89, 102. United States, 93 Fed. Cl. 399, 403 (2010) (inding laches to be an
17. 28 U.S.C. § 1498(a). afirmative defense available to the government); Lamson v. United
18. See, e.g., Bondyopadhyay v. United States, 129 Fed. Cl. 793 States, 117 Fed. Cl. 755, 761–63 (2014) (holding the medical immu-
(2017) (involving a geodesic sphere phased array antenna system nity defense in § 287(c) of the Patent Act to be an available defense
for satellite communications); Ross-Hime Designs, Inc. v. United to the government based on Federal Circuit precedent).
States, 126 Fed. Cl. 299 (2016) (involving a robotic manipulator 27. 640 F.2d at 1167.
used by the National Aeronautics and Space Administration). 28. See Zoltek Corp. v. United States (Zoltek III), 442 F.3d
19. Markman v. Westview Instruments, Inc., 52 F.3d 967, 976 1345, 1350 (Fed. Cir. 2006), abrogated by Zoltek V, 672 F.3d 1309,
(Fed. Cir. 1995) (en banc), aff’d, 517 U.S. 370 (1996) (“[A patent] 1322–23 (Fed. Cir. 2012) (en banc); see also NTP, Inc. v. Research
infringement analysis entails two steps. The irst step is determining in Motion, Ltd., 418 F.3d 1282, 1316 (Fed. Cir. 2005) (“[D]irect
the meaning and scope of the patent claims asserted to be infringed. infringement under section 271(a) is a necessary predicate for gov-
The second step is comparing the properly construed claims to the ernment liability under section 1498.”); Motorola, Inc. v. United
device accused of infringing.” (citation omitted)). States, 729 F.2d 765, 768 n.3 (Fed. Cir. 1984).
20. See, e.g., Sevenson Envtl. Servs., Inc. v. United States, 29. Zoltek V, 672 F.3d at 1323.
76 Fed. Cl. 51, 57–58 (2007) (“The Court’s analysis in a patent 30. 35 U.S.C. § 154(a)(1).
infringement case involves two steps. The irst step is to determine 31. Motorola, 729 F.2d at 768 (“As occurs frequently in section 1498
the scope and meaning of the patents in a Markman claim construc- patent actions, the parties . . . are presenting and arguing the case as if
tion hearing. ‘Claim construction’ is a question of law for the Court it were an action brought under Title 35. Although concepts, phrases
to decide. A patent’s ‘claims’ deine the invention. The claims are and words commonly used in the patent ield may connote a panoply
the numbered paragraphs ‘particularly pointing out and distinctly of rights and remedies under Title 35, the same concepts, phrases and
claiming the subject matter which the applicant regards as his inven- words do not and cannot always connote or denote the same meaning
tion.’ 35 U.S.C. § 112. The Court must look to the wording of the under section 1498. Although a section 1498 action may be similar to a
claims to determine the scope and meaning of the patent. In the Title 35 action, it is nonetheless only parallel and not identical.”).
second step, the patent claims as construed by the Court are com- 32. 672 F.3d at 1321, 1323.
pared to the accused device or method to determine alleged patent 33. See 35 U.S.C. § 271(g) (“Whoever without authority imports
infringement.” (citations omitted)). into the United States or offers to sell, sells, or uses within the United
21. Am. Innotek, Inc. v. United States, 128 Fed. Cl. 135, 152 States a product which is made by a process patented in the United
States shall be liable as an infringer, if the importation, offer to sell, sale, contract creates an implied license for the government to use the pat-
or use of the product occurs during the term of such process patent.”). ented invention, however, the government is not bound to make direct
34. Zoltek V, 672 F.3d at 1323. payments to any subcontractor. See Blais v. United States, 31 Fed. Cl.
35. Id. at 1327. The government’s sales of and offers to sell a pat- 422, 427 (1994). In the same vein, inventions made during the course
ented invention deined as direct infringement under § 271(a) are of performing a government contract can result in a royalty-free license
not within the scope of § 1498 actions. In de Graffenried v. United between the government and the contractor, if the “invention is so tied
States, 25 Cl. Ct. 209, 216 (1992), that court held that the govern- to the work to be done under the contract as to contribute signiicantly
ment’s sale of or offers to sell a patented invention do not constitute to the results anticipated by that agreement.” Tech. Dev. Corp. v. United
infringement under § 1498(a) because “Section 1498 does not spe- States, 597 F.2d 733, 745–46 (Ct. Cl. 1979).
ciically authorize suits against the United States in instances of a 48. 806 F.2d at 1060–61.
sale of a patented device,” and “it would violate principles of sover- 49. Id.
eign immunity to interpret the statute as mandating compensation by 50. See, e.g., Robishaw, 891 F. Supp. at 1141 (citing Trojan, Inc.
the United States for such a sale.” v. Shat-R-Shield, Inc., 885 F.2d 854, 856–57 (Fed. Cir. 1989); W.L.
36. Aside from § 271(e), which relates exclusively to the infringe- Gore & Assocs., Inc. v. Garlock, Inc., 842 F.2d 1275, 1282–83 (Fed.
ment of pharmaceutical products regulated by the Food and Drug Cir. 1988); TVI Energy, 806 F.2d at 1059–60; Stelma, Inc. v. Bridge
Administration that plainly fall outside the scope of § 1498, as § 271(e) Elecs. Co., 287 F.2d 163, 164 (3d Cir. 1961)).
is a “highly artiicial” act of infringement in which no taking of any 51. Advanced Software Design Corp. v. Fed. Reserve Bank of
license could have occurred. Eli Lilly & Co. v. Medtronic, Inc., 496 St. Louis, 583 F.3d 1371, 1375 (Fed. Cir. 2009); Toxgon Corp. v.
U.S. 661, 678 (1990) (noting that § 271(e) is “a highly artiicial act of BNFL, Inc., 312 F.3d 1379, 1381–82 (Fed. Cir. 2002).
infringement” in which no manufacture, use, or sale has occurred, and 52. IRIS Corp. v. Japan Airlines Corp., 769 F.3d 1359, 1363
only applies to pharmaceutical drugs and no other products). (Fed. Cir. 2014). However, various government agencies have
37. Zoltek V, 672 F.3d at 1327 (“We do not decide the issue of indirect internal processes to hear administrative claims for patent infringe-
infringement, under §§ 271(b), (c), and (f), which is not before us.”); see ment. Christine Hlavka, Contractor Patent Bandits: Preventing the
also Advanced Aerospace Techs., Inc. v. United States, 113 Fed. Cl. 265 Government from Avoiding 28 U.S.C. § 1498 Liability for Its Con-
(2013) (inding that post–Zoltek V, a cause of action under § 1498(a) that tractors’ Unauthorized Use of Patented Material by Outsourcing
is recognized to be deined under § 271(f) may be viable so long as the One or More Steps of the Process Abroad, 37 Pub. Cont. L.J. 321,
exportation claim contains an allegation of use by the government). 324–25 (2008). During the pendency of an administrative claim, the
38. 28 U.S.C. § 1498(a). USCFC’s statute of limitations may be tolled pursuant to 35 U.S.C.
39. 583 F.3d 1371, 1376–77 (Fed. Cir. 2009). § 286. See Bondyopadhyay v. United States, No. 14-147C, 2015 WL
40. IRIS Corp. v. Japan Airlines Corp., 769 F.3d 1359, 1362 1311726, at *4–5 (Fed. Cl. Mar. 20, 2015).
(Fed. Cir. 2014) (quoting Madey v. Duke Univ., 413 F. Supp. 2d 53. 48 C.F.R. § 52.227-3.
601, 607 (M.D.N.C. 2006)). 54. Id.
41. Larson v. United States, 26 Cl. Ct. 365, 369 (1992); see also 55. RCFC 14(b), (c).
Sheridan v. United States, 120 Fed. Cl. 127, 131 (2015). 56. 549 F. App’x 964, 968 (Fed. Cir. 2013), aff’g UUSI, LLC v.
42. TVI Energy Corp. v. Blane, 806 F.2d 1057, 1060 (Fed. Cir. 1986); United States, 110 Fed. Cl. 604 (2013).
Hughes Aircraft Co. v. United States, 534 F.2d 889, 901 (Ct. Cl. 1976). 57. Id.
43. 48 C.F.R. § 52.227-1; see also Sevenson Envtl. Servs., Inc. v. 58. 420 F.2d 1057, 1060 (Ct. Cl. 1970).
Shaw Envtl., Inc., 477 F.3d 1361, 1367 (Fed. Cir. 2007); TDM Am., 59. Leesona Corp. v. United States, 599 F.2d 958, 964 (Ct. Cl.
LLC v. United States, 83 Fed. Cl. 780, 784–86 (2008). 1979) (“The theory for recovery against the government for patent
44. 48 C.F.R. § 52.227-2; see also Va. Panel Corp. v. MAC Panel infringement is not analogous to that in litigation between private par-
Co., 133 F.3d 860, 870 (Fed. Cir. 1997) (inding a patent owner did ties. When the government has infringed, it is deemed to have ‘taken’
not engage in patent misuse by threatening an injunction lawsuit the patent license under an eminent domain theory, and compensation
against a government contractor, despite that remedy being unavail- is the just compensation required by the Fifth Amendment.”).
able, because the contractor may be in the best position to report 60. Id. at 969 (citing United States v. Chandler-Dunbar Co., 299
potential infringement to the government). U.S. 53, 76 (1913)).
45. Va. Panel, 133 F.3d at 870; Larson, 26 Cl. Ct. at 370. 61. See Ga.-Pac. Corp. v. U.S. Plywood Corp., 318 F. Supp. 1116,
46. Larson, 26 Cl. Ct. at 370 (citing Bereslavsky v. Esso Stan- 1120–21 (S.D.N.Y. 1970) (outlining factors relevant to determining
dard Oil Co., 175 F.2d 148, 150 (4th Cir. 1949); Carrier Corp. v. “the amount of a reasonable royalty for a patent license” based on
United States, 534 F.2d 244, 247–50 (Ct. Cl. 1976); Hughes, 534 “hypothetical negotiations”), modiied sub nom. Ga.-Pac. Corp. v. U.S.
F.2d at 897–901). Plywood-Champion Papers, Inc., 446 F.2d 295 (2d Cir. 1971).
47. TVI Energy, 806 F.2d at 1060; Robishaw Eng’g Inc. v. United 62. Decca Ltd. v. United States, 640 F.2d 1156, 1167 (Ct. Cl. 1980).
States, 891 F. Supp. 1134, 1145 (E.D. Va. 1995) (“[T]he policy purpose 63. Id.
behind § 1498 is to insulate the government and its private contrac- 64. Id.
tors from ‘lawsuits disruptive of the procurement process.’” (quoting 65. Id. at 1168; see also Hitkansut LLC v. United States, 130
H.R. Rep. No. 872, 82d Cong., 1st Sess. 1420 (1951), as it appears in Fed. Cl. 353, 391–94 (2017).
Northrop Corp. v. McDonnell Douglas Corp., 705 F.2d 1030, 1041 (9th 66. Richmond Screw Anchor Co. v. United States, 275 U.S. 331,
Cir. 1983)).) Similarly, so as not to disturb the procurement process, a 343 (1928) (“The purpose of the [1918] amendment was to relieve the
subcontractor’s use of the subcontractor’s own patents in performing a contractor entirely from liability of every kind for the infringement of
patents in manufacturing anything for the Government and to limit the statute of limitations under 28 U.S.C. § 2501, § 1498(b) provides for a
owner of the patent and his assigns and all claiming through or under three-year statute of limitations, stating that “[e]xcept as otherwise pro-
him to suit against the United States in the Court of Claims for the vided by law, no recovery shall be had for any infringement of a copyright
recovery of his reasonable and entire compensation for such use and covered by this subsection committed more than three years prior to the
manufacture. The word ‘entire’ emphasizes the exclusive and compre- iling of the complaint or counterclaim for infringement in the action.”
hensive character of the remedy provided.”). 74. 533 F.3d 1374, 1380–81 (Fed. Cir. 2008).
67. Heinemann v. United States, 620 F.2d 874, 877–78 (Ct. Cl. 1980). 75. Gaylord v. United States, 678 F.3d 1339, 1343 (Fed. Cir.
68. Motorola, Inc. v. United States, 729 F.2d 765, 768 n.3 (Fed. 2012). Like the Copyright Act, however, § 1498(b) permits a suc-
Cir. 1984). cessful copyright owner to collect “minimum statutory damages”
69. The Invention Secrecy Act provides different procedures per 17 U.S.C. § 504 in lieu of proving actual damages. Cohen v.
based on whether the government has a property interest in the pat- United States, 105 Fed. Cl. 733, 752 (2012).
ent. 35 U.S.C. § 181. 76. Steve Altman Photography v. United States, 18 Cl. Ct. 267
70. Id. § 183; Honeywell Int’l, Inc. v. United States, 609 F.3d (1989) (citing Williams & Wilkins Co. v. United States, 487 F.2d
1292, 1303 (Fed. Cir. 2010). 1345 (Ct. Cl. 1973), aff’d per curiam, 420 U.S. 376 (1975)); Cohen,
71. E.g., Linick v. United States, 96 Fed. Cl. 78, 84 (2011) (“Sec- 105 Fed. Cl. at 740–41 (“In general, to determine copyright infringe-
tion 183 provides an administrative remedy to allow a claimant to ment, the Court of Federal Claims examines the substantive law of
receive the compensation he seeks without requiring the interven- copyright.” (citing RT Comput. Graphics, Inc. v. United States, 44
tion of the judicial system. The administrative remedy is intended to Fed. Cl. 747, 754 (1999)).
assist the claimant—not to hinder his application.”). 77. Porter v. United States, 473 F.2d 1329, 1337 (5th Cir. 1973).
72. Steven Aftergood, Invention Secrecy Increased in 78. Walton v. United States, 551 F.3d 1367, 1369 (Fed. Cir. 2009).
2016, Fed’n of Am. Scientists (Oct. 31, 2016), https:// 79. See, e.g., Eficient Enter. Eng’g v. United States, No.
fas.org/blogs/secrecy/2016/10/invention-secrecy-2016/; 16-1421C (Fed. Cl. iled Oct. 27, 2016).
Joshua Brustein, Congratulations, Your Genius Pat- 80. 48 C.F.R. § 52.227-19(a).
ent Is Now a Military Secret, Bloomberg (June 8, 2016), 81. See David S. Bloch, “When Two Worlds Collide”: Compar-
https://www.bloomberg.com/news/articles/2016-06-08/ ing Software License Boilerplate with Government Contracts, 8
congratulations-your-genius-patent-is-now-a-military-secret. Landslide, no. 3, Jan./Feb. 2016.
73. 28 U.S.C. § 1498(b). In contrast to the USCFC’s general six-year 82. 48 C.F.R. § 52.227-19(b).
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The Hidden
Persuader
Sound Marks as Sonic Indicators of Source
By Anna L. King and Luke S. Curran
ur living environment is controlled by electronic consumers. However, are major brands missing the mark?
O
devices. Historically, we interacted with these
devices visually, via computer, smartphone, and Thinking Strategically about Sound Marks
even smartwatch screens.1 However, it appears that Goodwill is the commercial value that companies derive from
our capacity for such screens peaked as new tech- consumer perceptions of a brand representing a speciic prod-
nologies are being developed (and quickly adopted) uct or service, rather than from the actual product or service
for voice-activated controls and systems.2 With itself.6 Leading brands understand this concept and meticu-
the rising demand for hands-free (e.g., Apple’s lously build and constantly reshape their own unique visual
“Siri” and Microsoft’s “Cortana”) and screen-free electronics identities in connection with the provision of their respective
and personal assistants (e.g., Amazon Echo’s “Alexa,” Google goods or services. However, with the advent of voice-acti-
Home powered by Google Assistant, Xinity’s voice-activated vated devices and silent technologies, are they failing to
remote control, and home automation systems), the ability to bolster their brand by not also crafting an audio identity?
effectively distinguish these products through the use of sound Hearing is a very powerful human sense. On the most basic
as an indicator of source will undoubtedly grow in importance. level, sound engenders the inherent ability to transcend lan-
Do you recognize the sound of Netlix’s timpani strikes when guages. Further, listeners commonly associate a sound with a
its streaming services are initiated,3 Apple’s rapid two-tone rep- speciic memory. With our increasingly audio-enabled envi-
etition sound when Siri is engaged,4 or maybe Intel’s ive-note ronment, “congruent sound cues can increase the speed of a
chime?5 These are prime examples of sound marks that are the visual search for products (a key for success in both online and
result of effective sonic branding campaigns. retail settings).”7 However, sonic branding is generally over-
Developments in sound designations are also becom- looked despite the fact that the “strategic use of sound can play
ing more apparent as we create technologies that eliminate an important role in positively differentiating a product or ser-
the familiar sounds of functioning machines—for example, vice, enhancing recall, creating preference, building trust, and
electronic cars that start silently or even keyboards with- even increasing sales.”8 With this in mind, nontraditional trade-
out a familiar clicking sound. While these technologies are marks afford brand owners the ability to engage consumers in a
celebrated, some consumers are still reassured by the famil- meaningful manner across multiple media platforms.
iar sounds, and companies are left with a blank canvas for As arguably one of the most amorphous forms of intel-
creating new memorable nonfunctional sounds. As a result, lectual property, trademarks may be “almost anything at
companies have new opportunities for brand interaction with all that is capable of carrying meaning.”9 Sound marks, in
Illustration: iStockPhoto
Anna L. King is a shareholder at Banner & Witcoff, Ltd. in Chicago, Illinois. She specializes in trademark, copyright, and cyber law. She can
be reached at aking@bannerwitcoff.com. Luke S. Curran is an associate at Banner & Witcoff in Chicago, Illinois. He advises on many
aspects of intellectual property law, with particular emphasis on trademark clearance, prosecution, and enforcement. He can be reached at
lcurran@bannerwitcoff.com.
Published in Landslide® magazine, Volume 10, Number 1 , a publication of the ABA Section of Intellectual Property Law (ABA-IPL), ©2017 by the American Bar Association. Reproduced with permission. All rights reserved.
Association.
particular, are broadly described as marks that “identif[y] operating system sound mark,24 and UnitedHealth Group’s
and distinguish[] a product or service through audio rather electronic claim processing sound mark25).
than visual means.”10 While acting as an indicator of source,
sound marks enable brands to instantly trigger a particular Distinctiveness as a Barrier for Sound Mark
experience in the minds of consumers while simultaneously Registration
evoking speciic consumer attitudes and perceptions. Dissim- In order to be protectable, the sound must “assume a deinitive
ilar from traditional marks, this form of mark acts in such a shape or arrangement” and be able to generate an associa-
unique fashion that it has the innate ability to reach consum- tion in the minds of consumers between the sound and the
ers without requiring action by the listener. Sonic or auditory goods or services.26 Like traditional trademarks, a sound
branding offers brand owners the inimitable opportunity to mark’s level of protection will depend on whether it is inher-
reach passive consumers, develop equity and awareness, ently distinctive or more commonplace and nondistinctive.27
drive value, and connect with consumers on a deeper level. Speciically, the Trademark Trial and Appeal Board (TTAB)
Companies are constantly searching for new mechanisms to explained that a sound mark depends on the awareness of the
connect with consumers, and sound marks make it possible to listener, “which may be as leeting as the sound itself unless, of
reinforce brands through other senses while acting as a hid- course, the sound is so inherently different or distinctive that it
den persuader. In light of the development of voice-activated attaches to the subliminal mind of the listener to be awakened
and even silent technologies, the use of sound as a means when heard and to be associated with the source or event with
to distinguish products and services is the natural next step which it is struck.”28 Thus, a critical distinction must be made
in branding. However, only a small number of sound marks between “unique, different, or distinctive sounds and those that
mature to registration, and many companies fail to incorpo- resemble or imitate ‘commonplace’ sounds or those to which
rate such sensory experiences into their marketing strategy. listeners have been exposed under different circumstances.”29
Currently, a search for sound marks in the United States Pat- For example, “commonplace” sounds include those made by
ent and Trademark Ofice (USPTO) Principal Register identiies goods as part of their normal operation (e.g., alarm clocks,
approximately 312 records for pending applications and registra- mobile phones, appliances with alarms).30
tions. While registrable, sound marks undergo substantial review Further, the criteria for assessing the distinctive character of
and face unique impediments during the examination phase of a sound mark are no different from those to be applied to other
the trademark application process as displayed by the low num- types of marks.31 Sound marks that are unique may be regis-
ber of active sound mark applications and registrations. tered on the Principal Register without submitting evidence of
acquired distinctiveness; however, this is rather uncommon, as
Registrability of Marks Consisting Solely of Sound no concrete guidelines establishing what may qualify as inher-
While there is no international consensus as to whether a sound ently distinctive in the context of sound marks exist. In most
is registrable as a trademark, in many countries the deinition of cases, sound marks require a showing of acquired distinctive-
a trademark either includes sound as a mark or fails to exclude ness under 15 U.S.C. § 1052(f). As a result, in order to register
such marks.11 Historically, the United States is the most lexible a normal everyday sound, the application must be supported
with regard to the recognition of nontraditional trademarks. with evidence that purchasers or prospective purchasers recog-
The US Supreme Court interpreted the Lanham Act to nize the sound and associate it with a single source.32
afford broad protection over trademarks by articulating that In order to prove secondary meaning, applicants of such
a mark’s “ontological status” or form is nearly irrelevant commonplace sound marks must prove buyer association.
in comparison to its “source-distinguishing ability.”12 In When making a determination of whether a mark meets the
order to register a nontraditional mark on the USPTO Prin- threshold for secondary meaning, courts have commonly con-
cipal Register, the registration requirements for a standard sidered: (1) the length and manner of use, (2) the nature and
trademark application apply.13 Therefore, the sound must be extent of advertising and promotion, and (3) other efforts
capable of functioning as an indicator of source.14 Because at developing a conscious connection in the public’s mind
sound marks cannot be visually perceived and therefore the between the mark and the goods or services.33 While case
drawing requirement is waived, the applicant must submit law addressing secondary meaning is abundant, there is no
a detailed description of the mark.15 For instance, the appli- general consensus on the application of these elements in
cant may submit the musical notes that comprise the sound the context of sound marks.34 In short, if the sound imitates
(e.g., NBC’s chimes sound mark consisting of the notes G, “commonplace” sounds, is a sound to which consumers are
E, and C16) or simply describe the mark in layman’s terms exposed under different circumstances, or is made from the
(e.g., MGM’s sound mark comprising “a lion roaring”17). associated goods in their normal course of operation, the
Applicants should also submit an audio ile to supplement sound will likely face distinctiveness issues.
and clarify the description of the mark.18 While consum-
ers are likely familiar with sound marks in the context of Functionality Doctrine as a Barrier to Sound Mark
entertainment (e.g., Lucasilm’s THX sound mark,19 Twen- Registration
tieth Century Fox’s fanfare20 and D’OH sound marks,21 and Assuming that the owner of a sound mark can overcome the hur-
ESPN’s sports programming sound mark22), a clear shift is dle of proving secondary meaning, the doctrine of functionality
occurring directed toward the ield of computers and electron- may nevertheless preclude registration. The functionality doc-
ics (e.g., Cisco’s teleconferencing sound mark,23 Vorwerk’s trine prevents applicants from stiling competition through the
monopolization of a useful product feature.35 The Supreme Court a mark for cellular phones and two-way radios, which was
emphasized that the relevant inquiry is whether a product feature opposed by Nextel.45 In that case, the TTAB quickly noted
“‘is essential to the use or purpose of the article or if it affects the that because the “chirp” lacks inherent distinctiveness, the
cost or quality of the article,’ that is, if exclusive use of the fea- chirp may be registered only upon a showing of acquired
ture would put competitors at a signiicant non-reputation-related distinctiveness.46 In support of a claim of acquired distinctive-
disadvantage.”36 The USPTO’s Trademark Manual of Examin- ness, Motorola argued that (1) it had been manufacturing cell
ing Procedure further cautions that an application to register a phones that emit the chirp since 1996, (2) sales of these cell
sound mark must be refused as functional if the applied-for mark phone handsets were signiicant, and (3) it expended signiicant
would be “essential to the use or purpose of the goods” (e.g., “an resources in advertising the chirp in connection with the hand-
application to register the sound of a ring tone for download- set.47 In addition, Motorola relied on two consumer surveys
able ring tones”).37 The reasoning behind this doctrine is that the commissioned by Nextel to determine whether the chirp had
“Lanham Act does not exist to reward manufacturers for their acquired distinctiveness. However, the TTAB followed Vertex
innovation in creating a particular device; that is the purpose of and afirmed the denial of the application. The TTAB reasoned
the patent law and its period of exclusivity.”38 that cellular phones are the type of goods from which con-
When addressing the issue of functionality, courts com- sumers would expect to hear various sounds as they indicate
monly consider the following four factors: (1) the existence operational functions. Further, the TTAB noted that Motoro-
of a utility patent disclosing the utilitarian advantages of the la’s use of the chirp was not exclusive, as displayed by Nextel’s
design; (2) advertising materials touting the design’s util- use, which strongly inluenced the determination that the chirp
itarian advantages; (3) the availability to competitors of had failed to acquire distinctiveness.
functionally equivalent designs; and (4) facts indicating that Similarly, in In re Powermat, Inc., Powermat applied to reg-
the design results in a comparatively simple or cheap method ister a sound mark for battery chargers consisting of ive short
of manufacturing the product.39 Here, if the sound comes electronic chirps, lasting less than half a second, with each
from the workings of the machine or is essential to its pur- chirp increasing slightly in pitch from the previous chirp.48 Not
pose, the sound will likely face a functionality hurdle to surprisingly, the TTAB found that the applied-for sound fell
registration. Further, it is critical to note that a refusal based squarely within the controlling precedent established by the
on the doctrine of functionality cannot be overcome by a TTAB in Vertex and Nextel. Additionally, Powermat did not
showing of acquired distinctiveness. dispute that its goods emitted the sound in the normal course
of operation and, therefore, the applied-for sound mark could
TTAB Decisions Regarding Sound Marks not be inherently distinctive. Further, Powermat’s advertising
The TTAB considered the issues of secondary meaning and igures could not change the result as a claim of acquired dis-
functionality in sound marks in several trademark applica- tinctiveness cannot overcome the doctrine of functionality.
tions as outlined below.
In In re Vertex Group LLC, the TTAB considered the Conclusion
registrability of a sound pulse that can be heard from While sound trademark registrations appear to be a particularly
over a football ield away used in connection with the rare occurrence, a sound is indeed capable of acquiring trade-
“AmberWatch”—a personal security alarm emitted from a mark protection and can pay dividends in the form of increased
child’s bracelet used to prevent abductions.40 In reviewing the sales. Since Vertex, Nextel, and Powermat, the integration of
refusal of Vertex’s application, the TTAB denied registration screenless and voice-activated technologies has exploded in the
based on the two bases advanced by the examining attorney. United States. Thus, consumers are more predisposed to per-
First, examining distinctiveness, the TTAB emphasized ceive sounds as source identiiers. In view of the unprecedented
that when a sound is proposed for registration on the Prin- technological advancements eliminating functional sounds tradi-
cipal Register for goods that make the sound in the normal tionally emitted from machines, differentiating products through
course of operation, “registration is available only on a the use of nontraditional trademarks is more commonplace. To
showing of acquired distinctiveness under Section 2(f).”41 that end, when developing sound marks, it is critical to adopt a
However, the applicant did not resort to section 2(f) of the sound that will not be perceived as nondistinctive or functional.
Trademark Act. In refusing registration, the TTAB noted Sound could be the next frontier in creative branding, and
that the alarm sound consisting of a series of sound pulses is a carefully developed audio identity can become one of a
“commonplace and the types of sounds to which prospective company’s most powerful assets.49 With careful development
consumers of applicant’s products would have been exposed and creative attorneys, we should also see the registration of
in various circumstances.”42 The TTAB reasoned that con- such sounds becoming more frequent at the USPTO. n
sumers are not predisposed to equate such sounds with the
sources of the products that emit them.43 Additionally, in Endnotes
refusing registration based on functionality, the TTAB noted 1. GooGle, The New MulTi-ScreeN world: uNderSTaNdiNG croSS-
that “quite simply, the use of an audible alarm is essential to PlaTforM coNSuMer Behavior 18 (2012), https://services.google.com/
the use or purpose of applicant’s products.”44 For that reason fh/iles/misc/multiscreenworld_inal.pdf (inding that 90 percent of
alone, the TTAB afirmed the functionality refusal. users move between devices sequentially to accomplish a task).
Likewise, in Nextel Communications, Inc. v. Motorola, Inc., 2. David Streitfeld, Google Home: A Voice-Activated Device That
Motorola iled an application to register its “chirp” sound as Continued on page 69
Toward
a Social
Networking
Law?
(2017 Edition)
By Hillel I.
Parness
N
early 10 years ago, I wrote that one of the two most In expanding on this thought, the New York ethics commit-
popular social networking sites was Myspace—rea- tee recognized the same dangers as their Florida counterparts, but
son enough to write an update! I also spent a lot of did not conclude that social media “friending” is an automatic
time focusing on the looming problem of “widgets,” problem, explaining that judges must “consider whether any such
which I had to look up to remind myself what the online connections, alone or in combination with other facts, rise
issues were. Certainly a lot has changed, but the questions we to the level of a ‘close social relationship’ requiring disclosure and/
asked a decade ago are just as pertinent in 2017. or recusal,” and to be aware that a presence on a social network
I opened the original article with a question: “Will social may lead to people asking the judge legal or case-related ques-
networks be the catalyst that leads to any game-changing judi- tions.9 “As is true in face-to-face meetings,” the opinion says, “a
cial decisions or legislation?”1 Certain technological shifts, judge may not engage in these communications.”10
I observed, had already led to changes in the law: The rise In 2013, the New York Advisory Committee on Judicial
of online speech, and speciically online defamation, led to Ethics determined that a judge need not be disqualiied just
the passage of the Good Samaritan provision of the Commu- because he is “friends” on Facebook with the parents of chil-
nications Decency Act in 1996, which protects “interactive dren affected by a case before him.11
computer services” from being treated as the “publisher or
speaker” of third-party speech.2 The potential for massive Despite the Facebook nomenclature (i.e., the word “friend”)
copyright infringement led to the enactment of the Digital Mil- used to describe these undeined relationships, . . . the mere
lennium Copyright Act’s safe harbors in 1998, limiting the status of being a “Facebook friend,” without more, is an insuf-
copyright exposure of certain classes of “service providers.”3 icient basis to require recusal. Nor does the Committee
The Anticybersquatting Consumer Protection Act,4 which pro- believe that a judge’s impartiality may reasonably be ques-
hibits the bad faith registration of trademark-infringing domain tioned or that there is an appearance of impropriety based
names, was passed in 1999, and the Controlling the Assault of solely on having previously “friended” certain individuals
Non-Solicited Pornography and Marketing (CAN-SPAM) Act,5 who are now involved in some manner in a pending action.12
which imposes limitations and penalties on certain types of
unsolicited e-mail, went into effect in 2003. The last 10 years In 2010, the Ohio disciplinary committee made clear that
have, in fact, seen a number of trends in and out of the courts having a social network “friend” may not have the same
tied speciically to the challenges posed by social networking. I implications as having an ofline friend, writing: “A rose is a
address some—but by no means all—of them here. rose is a rose. A friend is a friend is a friend? Not necessar-
ily. A social network ‘friend’ may or may not be a friend in
Lesson No. 1: Why Can’t We Be Friends? the traditional sense of the word.”13 The Ohio committee con-
In recent years, several states have tackled the thorny issues of tinued: “Inevitably, a judge who uses a social network site
whether judges, lawyers, and jurors can be “friends” on social will be asked to ‘friend’ other users, some of whom may be
media, with varying conclusions. Back in 2009, the Florida lawyers, some of whom may represent clients in the court
Supreme Court’s Judicial Ethics Advisory Committee asked on which the judge serves. Thus, judges seek guidance as
“[w]hether a judge may add lawyers who may appear before to appropriate ethical boundaries, in particular as to being
the judge as ‘friends’ on a social networking site, and permit ‘friends’ with lawyers on a social networking site.”14 Ulti-
such lawyers to add the judge as their ‘friend,’” and answered mately, the opinion says, “To ensure compliance with all of
“No.”6 The committee explained that it would violate the ethi- these rules, a judge should be aware of the contents of his or
cal rule that “[a] judge shall not lend the prestige of judicial her social networking page, be familiar with the social net-
ofice to advance the private interests of the judge or others; working site policies and privacy controls, and be prudent in
nor shall a judge convey or permit others to convey the impres- all interactions on a social networking site.”15
sion that they are in a special position to inluence the judge,” Oklahoma appears to follow the Florida approach, issuing
and believed that “listing lawyers who may appear before the a judicial ethics opinion in 2011 that cited the Florida opin-
judge as ‘friends’ on a judge’s social networking page rea- ion’s warning about the appearance of impropriety, adding:
sonably conveys to others the impression that these lawyer
‘friends’ are in a special position to inluence the judge.”7 We agreed and emphasize that whether such posting would
That same year, by contrast, a New York Advisory Com- mean that the party was actually in a special position is imma-
mittee on Judicial Ethics opinion reached the opposite result: terial as it would or could convey that impression. We believe
that the same rationale applies to social workers, law enforce-
The Committee cannot discern anything inherently inappropri- ment oficers, or others who regularly appear in court in an
ate about a judge joining and making use of a social network. adversarial role. In response to our speciic question, we do
A judge generally may socialize in person with attorneys who not believe that this extends to court staff.16
appear in the judge’s court, subject to the Rules Governing
Judicial Conduct. Moreover, the Committee has not opined that Hillel I. Parness (hip@hiplaw.com) is a solo litigator and intellectual
Photo: iStockPhoto
there is anything per se unethical about communicating using property practitioner admitted in New York and New Jersey. Since
other forms of technology, such as a cell phone or an Internet 2002, he has been on the adjunct faculty of the Kernochan Center for
web page. Thus, the question is not whether a judge can use a Law, Media, and the Arts at Columbia Law School, where he teaches
social network but, rather, how he/she does so.8 classes about intellectual property and the Internet.
More recently, North Carolina issued an interesting opin- warned everyone that “[t]his of course requires that any indi-
ion that made some very ine distinctions, explaining that a vidual using ESM to investigate jurors review the terms and
“rule of reason” approach leads to the conclusions that: (1) a conditions, including privacy features, which change fre-
lawyer can accept a social network invitation from a judge; quently, as well as his or her own network settings before
(2) a judge can accept an invitation from a lawyer; (3) a judge investigating jurors on such platforms.”22 A few years earlier,
can accept a skills endorsement from a lawyer; but (4) a law- the New York City Bar Association reached a similar conclu-
yer may not accept an endorsement from a judge, because sion about the notiication feature on LinkedIn.23
“[d]isplaying an endorsement or recommendation from a The ABA, by contrast, appears to have come to the oppo-
judge on a lawyer’s proile page would create the appearance site conclusion, writing that the “passive” review of a juror’s
of judicial partiality and the lawyer must decline.”17 Internet presence is allowed, even if the juror is notiied: “The
An analogous issue received a substantial amount of pub- fact that a juror or a potential juror may become aware that
lic attention in 2014, with the Federal Circuit’s reprimand of a lawyer is reviewing his Internet presence when a network
an attorney and the resignation of its chief judge, after the setting notiies the juror of such does not constitute a commu-
lawyer circulated an e-mail from the judge in which the judge nication from the lawyer in violation of Rule 3.5(b).”24
praised the lawyer and encouraged him to share the e-mail. In In the high-proile Oracle v. Google trial in 2016, the
the opinion addressing the lawyer’s actions, the court wrote: judge saw three main dangers in allowing lawyers to inves-
tigate jurors on the Internet: (1) jurors who learned that their
It would blink reality not to view respondent’s action as sug- proiles had been searched would not listen to judges tell-
gesting his retention because his special relationship would ing them not to do their own research; (2) it would allow
help to secure a favorable outcome at the Federal Circuit. lawyers to tailor their arguments and make “improper per-
Under these circumstances, forwarding the email to clients and sonal appeals” to speciic jurors; and (3) it would violate the
potential clients “impl[ies] an ability to inluence improperly a jurors’ privacy.25 Barring such research, however, would also
government agency or oficial to achieve results by means that not be proper, as “the lawyers would then be precluded from
violate the Rules of Professional Conduct or other law.”18 learning information readily available to the press and every
member of the public in the gallery. That is, with an outright
Lesson No. 2: It’s OK to Look, Isn’t It? ban, everyone in the gallery could have more information
There has been a similar wave of developments in the area of lit- about the venire persons and the empaneled jurors than the
igants’ and even jurors’ social media usage. While it is clear that lawyers themselves.”26 The judge concluded that the most the
lawyers may not actively interact with jurors, whether in per- court could do would be to tell the jurors they were about to
son or online, the question of whether jurors’ information can be be investigated, and allow them time to adjust the privacy set-
accessed by lawyers is far murkier, in part because the operation tings on their social media accounts. Ultimately, the parties
of various social media sites varies and changes over time. agreed not to investigate the jurors on the Internet at all.
In 2013 in New York, after a juror reported being “cyber-
stalked” by one of the attorneys, the judge questioned the Lesson No. 3: Was It Something I Said?
attorney and gave special instructions to the jurors: Another area that is receiving increased attention is judges’
use of the Internet to express their views about legal issues. In
[T]hrough inadvertence, apparently, a young lawyer went and 2015 in Texas, a judge was admonished for posting to Face-
continued that search during Tuesday, and so some of you book about a case she was presiding over, even though she said
may receive information on Linked In or something that a she did so “to fulill [her] campaign promise and [her] own
lawyer has accessed your proile or something like that. It’s goals of educating the public about our courts.”27 In doing so,
not because they’re about to offer you a job or anything like the opinion found, the judge “cast reasonable doubt upon her
it, it’s just they were carrying out this checking and they just own impartiality and violated her own admonition to jurors by
went beyond the time when it was permitted. And those mis- turning to social media to publicly discuss cases pending in
takes happen, young lawyers make mistakes like that.19 her court, giving rise to a legitimate concern that she would not
be fair or impartial.”28 The judge was then ordered to undergo
In 2016, a court in New Jersey allowed an ethics case to “four (4) hours of instruction with a mentor . . . in the area of
move forward against an attorney who instructed a parale- the proper and ethical use of social media by judges.”29
gal to submit a friend request to the opposing party, who had The ABA has issued guidance that judges who wish to
increased the privacy settings on his Facebook account.20 post to the Internet must do so carefully, with an awareness
Also in 2016, a Texas judge warned that “[a]ll attorneys, that “comments posted to an ESM site will not remain within
parties, and their respective employees and agents, including the circle of the judge’s connections. Comments, images, or
jury consultants, are prohibited from conducting or causing proile information, some of which might prove embarrassing
another to conduct any type of investigation by which a juror if publicly revealed, may be electronically transmitted with-
or potential juror may become aware that his or her ESM out the judge’s knowledge or permission to persons unknown
[electronic social media] is being reviewed or scanned.”21 The to the judge or to other unintended recipients.”30 Thus, “[a]
judge was referring to the fact that some social networks alert judge who has an ESM connection with a lawyer or party
their users when people look at their proiles, and that such who has a pending or impending matter before the court
an alert could constitute improper contact. The judge further must evaluate that ESM connection to determine whether the
judge should disclose the relationship prior to, or at the ini- 1. Intentionally disseminates an image of another person:
tial appearance of the person before the court,” but “nothing a. who is at least eighteen (18) years of age,
requires a judge to search all of the judge’s ESM connec- b. who is identiiable from the image itself or information
tions if a judge does not have speciic knowledge of an ESM displayed in connection with the image, and
connection that rises to the level of an actual or perceived c. who is engaged in a sexual act or whose intimate parts
problematic relationship with any individual.”31 are exposed, in whole or in part;
2. Disseminates the image with the intent to harass, intimidate
Lesson No. 4: Don’t Use “Password” as Your or coerce the person, or under circumstances in which a rea-
Password sonable person would know or understand that dissemination
An interesting trend that has swept most of the states in recent of the image would harass, intimidate or coerce the person;
years is legislation prohibiting employers and/or educational 3. Obtains the image under circumstances in which a reason-
institutions from requiring that employees (or prospective able person would know or understand that the image was to
employees) or students disclose their social media credentials. remain private; and
Virginia’s law, for example, prohibits employers from requir- 4. Knows or a reasonable person should have known that the
ing, requesting, or causing current or prospective employees to person in the image has not consented to the dissemination.34
disclose their social media credentials, and prohibits employers
from requiring employees to connect with particular people or The Oklahoma law excludes, among other things, when
change their privacy settings.32 “[t]he images involve voluntary exposure in public or com-
Maryland has similar legislation that bars schools from mercial settings.”35
requiring, requesting, suggesting, or causing a student, an Thus, we have seen the beginning of civil and criminal
applicant, or a prospective student to give access or the abil- cases based on revenge porn. Interestingly, the laws have
ity to observe the individual’s personal electronic account. It already been used beyond the traditional “ex-boyfriend”
further prohibits educational institutions from conditioning situation. In one such case, a woman is facing criminal prose-
acceptance or participation in speciied activities on allowing cution for posting a photograph of an older woman showering
certain individuals to join their social networks.33 in the gym on Snapchat, “shaming” the woman with a dis-
paraging message about her physical condition.36 In another,
Lesson No. 5: Boyfriends Often Become a woman was awarded $500,000 by a jury when her ex-boy-
Ex-Boyfriends friend posted nude pictures of her to multiple Internet sites.37
Many states have also adopted so-called “revenge porn” leg-
islation, speciically aimed at people who distribute sexual Conclusion (or To Be Continued)
imagery of others without consent. This is seen as a unique The innovations of the Internet age continue to surprise and
problem of our age. First, there was the addition of photo and amaze, and continue to drive new legal situations that are either
video capabilities on just about every phone. Then, there was magniied or exaggerated versions of issues we have seen before,
the cultural “selie” phenomenon, with additional technologi- and occasionally entirely new challenges. Social networks have
cal innovations speciically designed for easier selies (think become a key component of the Internet experience, and are
about front-facing cameras and selie-sticks). And inally, likely to still be here in some form 10 more years from now, and
the social networks fed a culture of constant and widespread likely to still be shaping the continuing legal response to advanc-
sharing. What resulted was a rise in people sharing intimate ing technologies. As to what the technologies, laws, and legal
photos or videos with others whom they trusted, followed by decisions will look like, however, we will have to wait and see—
abuse of that trust. The quintessential example is the spurned stay tuned for part 3 of this series in 2027. n
lover who distributes compromising photos of his or her for-
mer paramour. Like many such Internet-related trends, the Endnotes
idea of revenge porn did not begin now, but it became exceed- 1. Hillel I. Parness, Toward “Social Networking Law”?, 1 Land-
ingly easy to do, naturally giving rise to an increase in the slide, no. 4, Mar./Apr. 2009.
activity. The revenge porn laws arise out of a recognition that 2. 47 U.S.C. § 230(c).
preexisting intellectual property and defamation laws may 3. 17 U.S.C. § 512(a)–(d).
not reach the distribution of photographs or videos where the 4. 15 U.S.C. § 1125(d).
person depicted consented (at the time) to the creation, and 5. Id. §§ 7701–7713.
where the default law is that copyright in photographs resides 6. Fla. Judicial Ethics Advisory Comm., Op. 2009-20 (Nov. 17, 2009).
in the photographer, rather than the subject of the photo. 7. Id.
The revenge porn laws vary across states (31 states 8. N.Y. Advisory Comm. on Judicial Ethics, Op. 08-176 (Jan. 29.
had passed such laws by the end of 2016), but the general 2009) (citations omitted).
approach is to criminalize the distribution of sexual images of 9. Id.
another, and in some cases to provide a private right of action 10. Id.
as well. The Oklahoma law, for example, reads as follows: 11. N.Y. Advisory Comm. on Judicial Ethics, Op. 13-39
(May 28, 2013).
A person commits nonconsensual dissemination of private 12. Id. (citations omitted).
sexual images when he or she: Continued on page 58
Jointly Waging the
Battle against
Counterfeiters in Asia
A Blueprint for How Competing Brand
Owners Can Work Together to Effectively
Combat Illegal Trademark Counterfeiting
By Wayne Mack
48 LANDSLIDE n September/October 2017
rademark counterfeiting is rampant and
T
China is a haven for counterfeiters because they can con-
growing exponentially, costing businesses duct their illegal operations in relative anonymity, at very
billions of dollars each year.1 Fueled by global low cost, in a lax enforcement climate. The manufactur-
shifts in manufacturing and the dramatic rise ing process for counterfeit goods is often decentralized, with
in e-commerce, counterfeiting has spread fakes typically being produced in stages by small teams in
from fake handbags and watches to virtually back-street shops and houses in the Guangdong and Fujian
every type of product imaginable, even food provinces in southern China. Once manufactured, the coun-
products. Effectively addressing this problem terfeit products are then sold to retail and secondary market
requires industry solutions, particularly when distributors in wholesale markets located throughout China.
it comes to enforcing trademark infringement After the counterfeit goods reach the hands of distributors,
laws in foreign jurisdictions. This article dis- fakes are routinely marketed and sold throughout the world
cusses best practices for collaboration and on rogue Internet websites and auction sites that consumers
communication between brand owners in protecting their frequent in search of bargains. The Internet is a safe shelter
intellectual property (IP) rights against counterfeiters in Asia. for counterfeit goods because it allows faceless transactions
in which the buyer cannot physically examine the products
The Counterfeiting Epidemic in China prior to the sale. A study of 100 websites selling counterfeit
The overwhelming majority of counterfeit products are man- goods found that these sites draw more than 53 billion visits
ufactured in China, which is estimated as the source for more per year—an average of nine visits for every man, woman,
than 70 percent of the world’s counterfeit goods. China and and child in the world.3
Hong Kong together are estimated as the source for 86 per- Any manufacturer that ignores the threat to its business
cent of the counterfeit goods in the world and $396.5 billion from brand thieves in China does so at its own economic
worth of counterfeit goods each year.2 peril. Counterfeit goods are generally lower quality and less
Photo: iStockPhoto
September/October 2017 n LANDSLIDE 49
effective than genuine products. Consumers who unknow- IP Enforcement Options in China
ingly purchase counterfeit goods that fall short of their Enforcement of IP rights unquestionably plays a critical role
expectations are likely to never purchase those products in deterring counterfeiters. Indeed, there is a direct relationship
again. Fakes undermine a brand’s integrity and can cause between the degree to which companies protect their IP rights
irreparable injury to a brand’s reputation. This can result in and the extent of counterfeiting in a given economy. In countries
signiicant revenue losses and decreased market share.4 where IP rights are recognized and enforced, counterfeiting is far
less prevalent. The existence of civil and procedural remedies,
The Challenges to Effective Brand Protection in China mechanisms for determining the amount of damages generated
Even though it is one of the leading players in world trade, China by infringement, minimum imprisonment terms and statutory
lags behind most of the world when it comes to the recognition ines, and police and customs oficials who aggressively enforce
and protection of IP rights. Some sources say the issue is rooted those laws by seizing suspected counterfeit goods are extremely
in the Chinese culture and resistance to the concept of intellectual effective deterrents to counterfeiting.10
property. While Western culture views copying as “an inferior imi- Protecting IP rights in China requires a far different
tation of an original, and in fact cheating, ‘in many Asian nations approach than in the United States. In order to identify and
the highest compliment one can be paid is to be copied.’”5 prosecute a brand thief, manufacturers must take the initia-
Brand owners simply cannot rely on the government ofi- tive to investigate and identify who the counterfeiters are and
cials in China to independently investigate and prosecute where they are operating. Once that information is obtained,
counterfeiters. In many parts of China, counterfeiting is not companies must then lobby government oficials to take
considered a serious crime and criminal prosecution against enforcement action.
counterfeiters is inconsistent.6 Counterfeiting is extremely Unless a brand owner has experienced in-house investiga-
lucrative, and sometimes counterfeiters are large employers in tive capabilities on the ground in China, external investigators
the province. Consequently, local governments have a direct need to be utilized. Finding the right investigator in China is
or indirect interest in supporting counterfeiting, and “[m]any not a simple task as even the anticounterfeiting industry in
China itself has been plagued by fraud. According to a recent
report, major multinational companies paid investigators
in China who themselves manufactured or sold counterfeit
The anticounterfeiting goods. In other cases, investigators colluded with the very
counterfeiters they were hired to root out.11
If a company is willing to act proactively and invest in enforce-
industry in China itself ment, there are several different legal options that can be pursued:
Request Administrative Action

is plagued by fraud. The local Administration for Industry and Commerce (AIC)
has authority to conduct raids, seize infringing goods, and
order the destruction of fakes. AIC administrative actions
are initiated by the trademark registrant, who must have
irst conducted its own investigation in order to develop evi-
of the most lagrant brand violators are state enterprises and dence regarding the identity and location of the counterfeiter.
run by the same governments that should be policing them.”7 Once that evidence is gathered, the brand owner iles a writ-
In China, the enforcement of IP rights takes place at the local ten complaint with the appropriate ofice with the necessary
level. “Local governments in China control all the levers of power trademark registrations and other documents and informa-
in law enforcement.”8 Judges, police oficers, and administration it has developed. The AIC will then generally conduct
tive enforcement oficials “are all appointed by and beholden to the raid promptly, seize the counterfeit goods, and issue a
local government leaders,” who are reluctant to take action against decision within a matter of months. If the goods are found
counterfeiting because it may harm the local economy.9 While the to be counterfeit, the AIC will destroy the counterfeit goods
central Chinese government has made statements about the impor- and impose a ine on the counterfeiter. While the counter-
tance of protecting IP rights, at the local level there are serious feit goods are off the street and the AIC procedure is fast and
issues of local protectionism and even corruption. inexpensive, the ines imposed are not large and many coun-
terfeiters resume their illegal activity.
Wayne Mack is counsel to the US Golf Manufacturers Anti- Initiate Criminal Proceedings
Counterfeiting Working Group and coordinates that group’s efforts Trademark owners also have the option of pursuing criminal pro-
to investigate and prosecute those involved with distributing ceedings against infringers. These proceedings are initiated by the
counterfeit products in China in the online marketplace. As a trademark owner presenting to the Public Security Bureau (PSB)
partner in Duane Morris’ trial practice group, he regularly litigates or the local prosecutor evidence of infringement that the com-
antitrust matters and provides advice to clients regarding the pany has independently developed through an investigation or as
antitrust aspects of product distribution and pricing. He can be a result of the AIC process. At that point, the PSB or prosecutor
reached at wamack@duanemorris.com. will start its own investigation and make a determination whether
or not to prosecute the case. If the case proceeds to court and the a group of companies jointly have a far greater prospect of reach-
infringer is found guilty in a criminal court proceeding, the court ing the value thresholds that must be met for criminal prosecution.
will either order ines or sentence the infringer to prison depend- By approaching the government and speaking as one,
ing on the impact on society caused by the infringement. There are members of an industry have a much louder and more per-
value thresholds that must be met in order for an infringement to suasive voice when they interact with Chinese oficials and
rise to the level of a crime under Chinese criminal law.12 In addi- the Chinese legal system. Data shows that companies with a
tion to hiring investigators, companies typically retain attorneys poor relationship with the government experience more coun-
to interact with the prosecutor’s ofice, to monitor the trial, and to terfeiting infringements. In contrast, companies that have a
present arguments to the court at the sentencing phase. good relationship with the Chinese government receive faster
responses when they report counterfeit crimes.15
File Civil Litigation Examples of organizations that are utilizing this industry-
Brand owners who wish to recover money damages may also wide approach in China include the following:
ile civil proceedings against infringers. In China, trademark • The US Golf Manufacturers Anti-Counterfeiting
cases are normally handled by specialized IP courts in the Working Group includes six of the leading golf prod-
general civil court system. There is no discovery in Chinese uct manufacturers in the world. Since 2004, the group’s
civil proceedings, and companies cannot plan on developing close collaboration with international authorities has
evidence through the court process. As a result, the litigation led to the seizure of nearly two million pieces of coun-
itself is generally much quicker and less costly than simi- terfeited golf products. In the last ive years, nearly
lar proceedings in US courts. However, before commencing 1,500 websites selling counterfeit clubs and accessories
the civil case, the company must come up with its own evi- have also been shut down as the direct result of legal
dence of infringement through an independent investigation action brought by the group. The group also maintains
or through the AIC or criminal process. After the trial, the a website, keepgolfreal.com, that educates consumers
court may award monetary compensation to the victim, issue about fake golf products.
an injunction, or coniscate infringing goods and the machin- • The BEAMA Anti-Counterfeiting Working Group
ery used to produce these products. consists of 16 manufacturers of electrical infrastructure
products and systems that are collectively taking action
Inluencing Political Change against counterfeiters making counterfeit electrical
While enforcement is a critical component of a brand protec- installation products in China and distributors in many
tion program, the problem of counterfeiting in China will not be Middle Eastern and African countries. Since 2000,
solved unless there are political and legal changes that erode the over 15 million counterfeit products have been seized
inluence of local protectionism.13 In order to bring about such through the group’s efforts.
change, it is incumbent on brand owners to take a long-term • The Semiconductor Industry Association Anti-Coun-
approach to trademark protection that is not only measured by terfeiting Task Force works closely with government
the number of raids or seizures. The message needs to be “that agencies worldwide, including US Customs and other law
intellectual property is important to promote innovation and cre- enforcement agencies, to identify and stop parties involved
ativity, which are essential to economic development.”14 in manufacturing or traficking in counterfeit goods.
• The Bluetooth Special Interest Group, which is com-
Strength in Numbers: Collaboration between prised of leading companies developing and inluencing
Brand Owners Bluetooth technology, works closely with Chinese
Rather than ighting a solitary war against counterfeiters authorities on infringement investigations and raids
in China, some brand owners have joined together to form against infringers of Bluetooth trademarks.
working groups that have developed comprehensive indus- • Luxury brands, including LVMH and Estée Lauder, are
try strategies to deal with counterfeiting in China. They share collaborating with each other to develop best practices
intelligence about investigators, counterfeiters, leads, and for measuring and implementing IP enforcement in
other information about counterfeiting. These groups jointly China as well as other Asian countries. These practices
hire and share the cost of investigators to root out the coun- include designing and managing IP investigation bud-
terfeiters. Armed with that information, they then petition gets, which are put toward iling complaints within the
government oficials in China to prosecute brand thieves. 76 different patent courts in China.16
There are a number of strategic advantages to proceeding As members of these groups have found, industry mem-
collectively, rather than individually. By collaborating, com- bers who are able to work together to ight counterfeiting are
panies have been able to obtain eficiencies and economies less likely to waste money and more likely to prevail than com-
of scale, to reduce the cost of investigation and enforcement panies that engage in a series of expensive and uncoordinated
borne by each company, and to combine inancial and other efforts. Because companies have expertise in distinguishing
resources to stop illegal infringement. their own products from counterfeits, “collaborating to share
Brand thieves often target entire industries, and raids of coun- enforcement costs can make enforcement more effective.”17
terfeiters in China frequently turn up many different types of
counterfeit products at retail shops or in a factory or workshop. Keys for Effective Collaboration
Therefore, investigations and raids that are conducted on behalf of Anticounterfeiting working groups are made; they are not
born. They require leaders who are willing to think creatively enhancing and beneicial for consumers.
and to form strategic alliances. Often competing brand own- According to the federal antitrust enforcement agencies,
ers are reticent to work together or to share inancial and “[i]n order to compete in modern markets, competitors some-
other resources. There is also the potential for personality times need to collaborate. Competitive forces are driving
conlicts, different goals, and disagreements about what the irms toward complex collaborations to achieve goals such as
group can and should do collectively. expanding into foreign markets, funding expensive innovation
As in any form of collaboration, in order to succeed, it is efforts, and lowering production and other costs. Such collab-
essential that the members of the group share a common vision orations often are not only benign but procompetitive.”19
and agree up front on the ground rules for how the group will Combating counterfeiting is clearly a procompetitive
operate and function. These are critical issues that must be activity. In a free-market economy, the amount that a irm
addressed at the outset and documented in a group working plan invests in innovation depends on the perceived rewards from
that can be revisited when critical issues or disagreements arise. its investment. Typically, the investment is greater when the
In the context of enforcement in China, some important perceived rewards are higher. If brand owners face dimin-
issues that the group needs to decide are: ished rewards due to others’ uncompensated use of their
• What is the group budget, and how much money will creations and trade names, their incentive to innovate would
each member invest in the group endeavor? likely be lessened. Consequently, irms may make fewer
• What are the group’s enforcement goals? Sei- technological advances; competitiveness may suffer; and con-
zures? Monetary recoveries? Criminal sentences for sumers may face fewer choices and higher prices. Restricting
counterfeiters? the unauthorized use of inventions and trade names helps
• Will the group proceed when an investigation only guarantee that inventors receive a return on their efforts, pro-
turns up counterfeit products infringing on the rights of motes innovation, and gives consumers and irms access to
only one or a few group members, rather than all of the inventions that otherwise may never have been produced.
group members? In order to minimize the antitrust risk, an industry group
• What are the group’s goals? Is the group’s focus on organized to combat counterfeiting should have an up-to-
counterfeit retailers, distributors, or manufacturers? date, written antitrust compliance policy that is publicized
• How will the group make decisions? By majority vote? in materials distributed to group members. All group meet-
• How frequently will the group meet? ings should strictly follow a written agenda, which members
• What actions, if any, will the group take to deal with can review in advance with legal counsel to identify poten-
online counterfeit sales on Chinese websites? tial issues of concern. Legal counsel should be present at
• How and when will the group interface and interact all meetings and participate in all discussions and e-mails
with Chinese government oficials and customs? between competitors to monitor and prevent discussion of
In addition to deciding these and other issues, it is abso- inappropriate matters. It is also vital to record and retain
lutely essential that the group decide upon who will be the accurate and complete records of meetings. The records
gatekeeper and coordinator for the group. Ideally, this will should indicate that the antitrust compliance policy was
be independent legal counsel who group members trust and reviewed and followed.
respect, who is knowledgeable about IP enforcement in Certain topics may be suggestive of a per se unlawful
China, and who, as explained below, is experienced with the agreement, which should be off-limits to the industry group.
antitrust considerations that must be kept in mind any time There should be no discussion of price-ixing, output restric-
that competitors meet or discuss jointly pursuing any form of tions, territorial or customer allocations, and group boycotts.
activity. Not only will the coordinator keep the group moving Members should not share competitively sensitive informa-
forward and on the same page, but he or she also will serve as tion, including information about each other’s past, present,
the clearinghouse for group communications and signiicantly or future prices; terms and conditions of sale; business or
reduce the administrative burden that would otherwise fall marketing plans; sales or capacity information; production;
upon individual group members. technology; sales practices; or any other competitively sensi-
tive information such as prices from suppliers.
Essential Antitrust Protocols The group’s focus should be to protect IP rights in order
Even trade associations that are organized for legitimate to beneit competition and promote innovation, instead of on
purposes can be fertile grounds for antitrust violations. Gov- reducing competition and increasing proits for its members.
ernment regulators have warned that it is essential for groups The group should also document and describe in writing all
of competitors working together in activities that promote of the ways it beneits its members and consumers. Finally,
consumer protection to follow appropriate antitrust protocols. the group should take action only where there is a good-faith
While the antitrust laws prohibit competitors from engag- belief that counterfeiting is taking place.
ing in price-ixing and other forms of anticompetitive activity,
there are many other forms of joint conduct that are permissi- Moving Together beyond Enforcement in China
ble. For example, lobbying government oficials and pursuing If essential antitrust protocols are adopted and followed, indus-
litigation are actions that are immune from antitrust liability try members not only have the opportunity to collaborate to
under the Noerr-Pennington doctrine.18 Similarly, competi- investigate and prosecute counterfeiters in China, but they also
tors are permitted to collaborate in ways that are eficiency can jointly pursue other anticounterfeiting strategies together.
For example, trademark owners can work together to pursue 9. Id.
legal action here in the United States and elsewhere to shut 10. GIPC Study, supra note 1, at 20.
down websites selling counterfeit goods. In addition, they can 11. Who’s Investigating Fake Chinese Goods? Fake Investiga-
jointly engage in public relations campaigns to educate con- tors, Chi. Trib., Dec. 15, 2015.
sumers and potentially adopt and promote industry standards 12. Under Chinese law, a trademark crime may be recognized if
that will assist consumers in recognizing counterfeit goods. someone has produced or knowingly sold counterfeit products and
By joining together to combat counterfeiting and to protect IP the value of the products is higher than RMB 50,000 or the infringer
rights, competitors promote free and fair competition, which is obtains proits of more than RMB 30,000. Xing Fa (刑法) [Criminal
consistent with the underlying purpose of the antitrust laws. n Law] (promulgated by the Standing Comm. Nat’l People’s Cong.,
Mar. 14, 1997, effective Oct. 1, 1997), art. 213, 1997 Standing
Endnotes Comm. Nat’l People’s Cong. Gaz. 138.
1. Global estimates of the dollar volume of counterfeit goods 13. Chow, supra note 8, at 779.
range from $200 billion to over $1.7 trillion—accounting for 5 to 14. Id. at 776.
10 percent of world trade. GloB. iNTellecTual ProP. cTr., u.S. 15. Ya Qian, Impacts of Entry by Counterfeiters, Q. J. Econ.,
chaMBer of coMMerce, MeaSuriNG The MaGNiTude of GloBal Nov. 2008, at 1577, 1584.
couNTerfeiTiNG 13 (2016) [hereinafter GiPc STudy]. 16. Loke-Khoon Tan et al., The Top 10 Enforcement Trends
2. Id. at 3. against Luxury Fakes in China, World Trademark Rev., Oct./Nov.
3. MarkMonitor, Traffic Report: Online Piracy and 2013, at 62, 64.
Counterfeiting 7 (2011). 17. Yi Qian, Counterfeit Competition, Kellogg Insight
4. Kevin Lewis, The Fake and the Fatal: The Consequences of (June 1, 2009), https://insight.kellogg.notherwestern.edu/article/
Counterfeits, 17 Park Place Economist 47, 52 (2009). counterfeit_competition.
5. Daniel C. Fleming, Counterfeiting in China, 10 U. Pa. E. Asia 18. Under the Noerr-Pennington doctrine, private entities are
L. Rev. 14, 23–24 (2014). immune from liability under the antitrust laws for attempts to
6. U.S. Chamber of Commerce, International IP Index inluence the passage or enforcement of laws. E. R.R. Presidents
85 (4th ed. 2016), http://www.theglobalipcenter.com/wp-content/ Conference v. Noerr Motor Freight, Inc., 365 U.S. 127, 135 (1961);
themes/gipc/map-index/assets/pdf/2016/GIPC_IP_Index_4th_ United Mine Workers of Am. v. Pennington, 381 U.S. 657, 670
Edition.pdf. (1965). The doctrine extends to protect individual or group action
7. Fleming, supra note 5, at 27–28. intended to inluence legislative, executive, administrative, or judi-
8. Daniel Chow, Anti-Counterfeiting Strategies of Multi-National cial decision making.
Companies in China: How a Flawed Approach Is Making Counter- 19. Fed. Trade Comm’n & Dep’t of Justice, Antitrust Guide-
feiting Worse, 41 Geo. J. Int’l L. 749, 755 (2010). lines for Collaborations among Competitors 1, 6 (2000).
2018 Write
Speak
Mark T. Banner Call for Listen
Award Nominations Law
The ABA Section of Intellectual Property Law

announces the 2018 Mark T. Banner Award
This award honors an individual or group that

has made an impact on intellectual property law
and/or practice. The award will be presented
at the Mark T. Banner Award Luncheon,
on April 19, 2018 at the 33rd Annual For information and the nomination form:
Intellectual Property Law Conference http://ambar.org/markbanneraward
in Arlington, Virginia. Contact: Amy.Mandel@americanbar.org
Please submit nominations by

October 16, 2017.
The New T
hrough a series of amendments to the Indus-
trial Property Law published June 1, 2016,
Mexico created a formal trademark opposition
system. While the new system is far from per-
fect, it is an important step forward.
Trademark Background
Although trademarks have been registrable in Mexico since
1885,1 there was never a formal trademark opposition system.
Applications that survived ex parte examination proceeded
Opposition directly to registration.

The virtue of the system was that it was simple and rapid.
The Mexican Institute of Industrial Property (IMPI) generally
granted or refused applications within six months of iling.
System in
The disadvantage was that ex parte examination had inherent
limitations, as discussed below. Moreover, the owner of a Mexican
trademark registration had (and continues to have) the exclusive
right to use the mark for the goods or services identiied in the reg-
istration, and could not be sued for trademark infringement, until
Mexico and unless the registration was canceled or declared invalid. This
often gave the owner of a wrongly granted trademark registration
an unfair and unwarranted advantage against others in the market.
Consider the following hypothetical: Compagnie, a French
company, has long used the mark CHAT NOIR for cologne.
By John M. Murphy These products have been sold in Mexico through a local dis-
tributor, Equis. However, Compagnie terminates Equis over a
payment dispute and signs an agreement with a new distributor.
Compagnie has never registered the mark CHAT NOIR in
Mexico. After being terminated, Equis registers the mark CHAT
NOIR in its own name and begins selling a cheaper fragrance
under the mark. Compagnie does not learn of the application until
after it has matured to registration. When Compagnie resumes
sales of genuine CHAT NOIR cologne in Mexico, Equis sues
Compagnie and its new distributor for trademark infringement.
Under Mexican law, Compagnie may counterclaim for
invalidation of Equis’s registration, based on Compagnie’s
prior use of the mark CHAT NOIR in both France and Mex-
ico, and Equis’s bad faith in registering the mark. Once IMPI
declares Equis’s registration to be invalid, Compagnie can
register the mark CHAT NOIR in its own name, and sue
Equis for infringement. However, this is a lengthy process
with an uncertain outcome.2 Rather than face this prospect,
Compagnie pays Equis a large sum of money to assign the
registration, dismiss the infringement action, and cease its
sales of counterfeit cologne.
John M. Murphy is of counsel with Arochi & Lindner

S.C. in Mexico City.
Published in Landslide® magazine, Volume 10, Number 1 , a publication of the ABA Section of Intellectual Property Law (ABA-IPL), ©2017 by the American Bar Association. Reproduced with permission. All rights reserved.
Association.
To prevent situations like these, IMPI has allowed the iling
of informal “observations” against pending trademark applica-
tions, akin to letters of protest in the United States.3 However,
trademark examiners were not obligated to respond to or even
consider such observations.4 Moreover, trademark owners who
relied on commercial watch services usually did not learn of
potentially infringing marks until after the registration was
granted and published in the Industrial Property Gazette.
The lack of an opposition system became a minor interna-
tional embarrassment because only eight jurisdictions apart from
Mexico did not allow trademark oppositions.5 Both the Senate
and the Chamber of Deputies noted, in statements of legislative
purpose, the need to harmonize the Industrial Property Law (LPI)
with the laws of Mexico’s principal trading partners.6
How the New Opposition System Works

The new opposition system was designed with two goals in
mind. First, Congress sought to blunt the criticisms of com-
mentators who claimed that delay in granting trademark
registrations would destroy small business and entrepreneur-
ship in Mexico.7 Second, Congress sought to minimize any
disruption to the previously existing trademark registration
process.8 The principal features are as follows:
• New trademark applications are published in the Indus-
trial Property Gazette within 10 business days of iling.9
• Any person who believes an application should be
refused may ile an opposition within one month of publi-
cation.10 This term may not be extended.
• IMPI has established an opposition fee of
MXN$3,733.72, or slightly over USD$200 at the cur-
rent exchange rate.
• The opposition must be presented in writing and may be
accompanied by any evidence which the opposer con-
siders appropriate.11
• Within 10 business days of the close of the opposi-
tion period, IMPI publishes a list of applications that
have been opposed in the Industrial Property Gazette.
The applicant then has one month to respond.12 The
applicant’s failure to respond is not considered a tacit
admission of the opposer’s allegations.13
In most countries, an opposition is a proceeding distinct
from ex parte examination, litigated before a specialized
body such as the Trademark Trial and Appeal Board of the
US Patent and Trademark Ofice. In Mexico, the opposi-
tion and answer are simply forwarded to the examiner for
Photo: iStockPhoto
Published in Landslide® magazine, Volume 10, Number 1, a publication of the ABA Section of Intellectual Property Law (ABA-IPL), ©2017 by the American Bar Association. Reproduced with permission. All rights reserved.
Association.
consideration during substantive examination. IMPI does not the registration has been granted.22
suspend its examination of the application while the opposi- A second, less obvious weakness is that the potential grounds
tion is pending.14 Moreover, the opposition does not “confer for opposition are limited to grounds for ex parte refusal under
upon the person who presents it the character of an interested LPI Articles 4 and 90 (e.g., the mark is descriptive, generic,
party, third party or party,”15 which means that the opposer functional, scandalous, confusingly similar to a prior registered
has no right of appeal if the opposition is dismissed.16 In mark, or in conlict with a prior famous or well-known mark).
effect, the new system simply formalizes the previous prac- Other objections may only be raised through an invalidation
tice of observations against pending applications. action after the registration is granted, namely:
• The registered mark is identical or confusingly similar
Beneits of the New Opposition System to another mark previously used, in Mexico or any other
By and large, trademark examiners at IMPI do their job con- country, for identical or similar goods or services.23
scientiously. However, there are inherent limitations on what • The registration was granted on the basis of an applica-
ex parte examination can accomplish. For example, Mexi- tion containing false information (typically, an incorrect
can law recognizes that famous and well-known marks are date of irst use).24
entitled to broader protection than marks in general, but • The registration was obtained without authorization by an
examiners have no way of evaluating the fame or notoriety agent, representative, authorized user, or distributor of a
of prior marks unless the owner of the famous or well-known person who has registered the mark in another country.25
mark has iled observations or the mark is the subject of a for- There is a certain logic to this: if one views the opposition
mal declaration of fame or notoriety.17 system as an aid to ex parte examination, there is no point in
Similarly, examiners search the IMPI trademark database allowing grounds for opposition that would not be a basis for ex
(Marcanet) using a “phonetic search” algorithm that in theory parte refusal. However, if one views the opposition system as a
identiies the marks in the database most similar to the mark means of preventing the iling of abusive infringement actions
being searched. However, while the algorithm does a reason- by the owners of trademark registrations that should never have
able job of identifying visually or phonetically similar marks, been granted (as in the above hypothetical), it is plainly deicient.
it does not identify foreign equivalents or marks that are
similar in meaning but dissimilar in appearance and pronun- Implementation
ciation. Further, there is no way to search for similar marks The amendments to the LPI that created the opposition sys-
across multiple classes.18 tem took effect on August 30, 2016. On September 12, 2016,
Further, examiners are limited in their ability to identify IMPI published the irst edition of the Industrial Property
marks that are descriptive, generic, functional, or otherwise Gazette listing newly iled applications. By March 10, 2017,
inherently incapable of serving as trademarks under Mexi- a total of 1,915 oppositions were iled—approximately 2.6
can law. Most examiners would likely refuse an application percent of all applications iled.
to register LAGER for beer or ROMAINE for lettuce, but few The impact of the new system requires further assess-
would know that a certain word or phrase is a term of art in ment, because many oppositions iled thus far have not been
the ield of neurosurgery or petroleum engineering. decided, and some opposed applications that are ultimately
In Mexico as elsewhere, the refusal of a trademark applica- refused would have been refused ex parte under the former
tion must be legally and factually supported by the examiner.19 system. While there is no hard data, application pendency
The primary goal of the new system is to strengthen ex parte seems to have lengthened somewhat. However, this may be a
examination by creating a formal means by which interested temporary phenomenon that will abate as IMPI and the trade-
parties can advise examiners of potential bases for refusal that mark bar acclimate to the new system. n
they might otherwise miss, and supply them with evidence to
support refusals that would otherwise be overturned on appeal. Endnotes
1. Nava Negrete, Justo, Tratado sobre derecho de marcas [Trea-
Weaknesses of the New Opposition System tise on Trademark Law], México: Porrúa, 2012, p. 76.
An obvious weakness of the new opposition system— 2. Historically, IMPI has required parties to submit invoices
at least from the standpoint of potential opposers—is that to show prior continuous use of a mark. In many cases, invoices
oppositions will be considered by examiners and not by an are unavailable, or are refused admission into evidence on formal
independent body. Because an opposition “will not preju- grounds. In other cases, the invalidation claim is rejected because
dice the result of the substantive examination undertaken by the party seeking invalidation cannot prove that the goods identiied
the Institute regarding the application,”20 and the dismissal in the invoices bore the mark at issue.
of an opposition will not be subject to appeal, there is a risk 3. See U.S. Pat. & Trademark Office, Trademark Manual
that examiners will not give oppositions the attention they of Examining Procedure (TMEP) § 1715 (Apr. 2017).
deserve, particularly if IMPI is determined at all costs to 4. One nonbinding judicial decision states that in rare cases,
maintain application processing times. While the inal refusal IMPI may be required as a matter of constitutional law to consider
of an application must be supported by a resolution detailing third-party observations in order to avoid contradictory decisions in
the factual and legal basis for the refusal, the examiner has co-pending trademark registration and infringement proceedings.
no obligation to explain his or her reasons for dismissing an Marca. Previa concesión de su registro debe otorgarse la garantía de
opposition.21 The examiner need only notify the opposer that audiencia a quien en diverso procedimiento solicitó la declaración
administrativa de infracción por el uso de una semejante en grado de 15. Id.
confusión, aun cuando la Ley de la Propiedad Industrial no prevea la 16. However, there is nothing in the statute to prevent an unsuc-
igura de tercero opositor, Tribunales Colegiados de Circuito [TCC], cessful opposer from iling an invalidation or cancellation action with
Semanario Judicial de la Federación y su Gaceta, Novena Época, the Industrial Property Protection Division of IMPI once the regis-
tomo XXV, Enero de 2007, Tesis I.4o.A.552 A, Página 2265 (Mex.). tration has been granted. It remains to be seen whether, or to what
5. These jurisdictions are Algeria, Belarus, Curaçao, Kyrgyzstan, degree, the dismissal of an opposition will prejudice the outcome of a
Lebanon, Malta, Monaco, and Serbia. John M. Murphy, Famous later invalidation or cancellation proceeding involving the same mark.
and Well-Known Marks in Mexico: Past, Present, and Future, 105 17. Murphy, supra note 5, at 1120–35.
Trademark Rep. 1060, 1149 (2015). 18. Marcanet allows users to search for identical marks without
6. Iniciativas de los Senadores integrantes de la Comisión de regard to classiication. Further, a phonetic search in one class will
Comercio y Fomento Industrial, con Proyecto de decreto por el sometimes return marks in other classes, but these marks are rarely
que se reforman y adicionan diversas disposiciones de la Ley de considered by examiners, and in any case it is not clear how the
la Propiedad Industrial, Gaceta del Senado [GS], núm. 49, tomo I, algorithm determines which marks in other classes are relevant.
10 de noviembre de 2015, pp. 135–36 (Mex.); De la Comisión de 19. Marcas. Debe motivarse la notoriedad de las, para justiicar la
Economía, con proyecto de decreto por el que se reforman y adi- aplicacion de la fracción XV del artículo 90 de la Ley de Fomento y
cionan diversas disposiciones de la Ley de la Propiedad Industrial, Protección de la Propiedad Industrial, Tribunales Colegiados de Cir-
Gaceta Parlamentaria, Cámara de Diputados [GPCD], año XIX, cuito [TCC], Semanario Judicial de la Federación, Octava Época,
núm. 4518-V, 28 de abril de 2016, p. 81 (Mex.). tomo XV-2, Febrero de 1995, Tesis I.4o.A.827 A, Página 405 (Mex.);
7. See, e.g., Jalife, Mauricio, “Oposición al sistema de oposición Tribunal Federal de Justicia Fiscal y Administrativa [TFJFA], Tribunal
de Marcas” [Opposition to the Trademark Opposition System], El Federal de Justicia Fiscal y Administrativa, Sexta Época, año II, núm.
Financiero, 26 de marzo de 2014, http://www.elinanciero.com.mx/ 24, Diciembre de 2009, Tesis VI-J-SS-51, Página 71 (Mex.).
opinion/oposicion-al-sistema-de-oposicion-de-marcas.html. 20. LPI art. 120.
8. GS núm. 49, tomo I, supra note 6, at 136. 21. In practice, IMPI has taken to publishing decisions stating its
9. Ley de la Propiedad Industrial [LPI], Diario Oicial de la Federación reasons for the dismissal of oppositions. This raises the interesting (but
[DOF] 27-6-1991, últimas reformas DOF 01-06-2016, art. 119 (Mex.). unresolved) issue of whether this converts the opposition into a conten-
10. LPI art. 120. tious proceeding in which the unsuccessful plaintiff has a right of appeal.
11. Id. 22. LPI art. 120.
12. Id. 23. LPI art. 151.II.
13. GS núm. 49, tomo I, supra note 6, at 136. 24. LPI art. 151.III.
14. LPI art. 120. 25. LPI art. 151.V.
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One Crack Continued from page 29
Conclusion 15. Id. at 96 (footnote omitted).

The DMCA safe harbor, though perhaps not as safe as once 16. 718 F.3d 1006, 1030 (9th Cir. 2013); see also Mavrix Photographs
thought, remains a strong shield to liability. But taking advan- LLC v. LiveJournal, Inc., 112 U.S.P.Q.2d (BNA) 1392, 1398–1400 (C.D.
tage of that shield requires ISPs to be aware of the changing Cal. 2014) (inding no right or ability to control under UMG Record-
currents at both the district and circuit court levels and to ings: “The undisputed facts show that users of the LiveJournal service, not
adapt their behaviors and policies accordingly. This can be an LiveJournal, select the content to be posted, put that content together into
expensive proposition, but recent jury verdicts suggest that a a post, and upload the post to LiveJournal’s service. LiveJournal does not
failure in policy or behavior is not just expensive—it can be solicit any speciic infringing material from its users or edit the content of
an ISP’s death knell. n its users’ posts. Nor does it have the ability to do so.”).
17. 840 F.3d 69 (2d Cir. 2016).
Endnotes 18. Id. at 86–87.
1. 840 F.3d 69 (2d Cir. 2016). 19. Id. at 87–88.
2. Viacom Int’l, Inc. v. YouTube, Inc., 676 F.3d 19, 38 (2d Cir. 2012). 20. Id. at 88–92.
3. Id. 21. Id. at 80.
4. See Perfect 10, Inc. v. Cybernet Ventures, Inc., 213 F. Supp. 2d 22. Safe harbor protection cannot be conditioned on “a service
1146 (C.D. Cal. 2002). provider monitoring its service or afirmatively seeking facts indicat-
5. 545 U.S. 913 (2005). ing infringing activity.” 17 U.S.C. § 512(m)(1).
6. See Columbia Pictures Indus., Inc. v. Fung, 710 F.3d 1020, 23. ISPs and prospective litigants may not need to wait much
1046 (9th Cir. 2013). longer, albeit in a slightly different context. The Fourth Circuit is
7. See Gardner v. CafePress Inc., 113 U.S.P.Q.2d (BNA) 1154, currently reviewing a $25 million jury verdict inding Cox Commu-
1159–60 (S.D. Cal. 2014). nications liable for wrongful contributory copyright infringement
8. 940 F. Supp. 2d 110, 121 (S.D.N.Y. 2013). over illegal music downloads. In that case, the plaintiff alleged that
9. 972 F. Supp. 2d 500 (S.D.N.Y. 2013). Cox ignored requests to terminate service to Cox subscribers who
10. Id. at 529. repeatedly shared music illegally, thus forfeiting the DMCA safe
11. Id. harbor. Cox argues that it was only sued because it refused to for-
12. Id. ward questionable infringement notices it alleged were aimed at
13. Id. at 530. extorting improper settlements from subscribers. See BMG Rights
14. Capitol Records, LLC v. Vimeo, LLC, 826 F.3d 78, 87 (2d Mgmt. (US) LLC v. Cox Commc’ns, Inc., 149 F. Supp. 3d 634 (E.D.
Cir. 2016). Va. 2015), appeal iled, No. 16-1972 (4th Cir. Aug. 24, 2016).
Social Networking Law? Continued from page 47
13. Ohio Bd. of Comm’rs on Grievances & Discipline, Op. 25. Oracle Am., Inc. v. Google Inc., No. 3:10-cv-03561 (N.D.
2010-7 (Dec. 3, 2010). Cal. Mar. 25, 2016).
14. Id. 26. Id.
15. Id. 27. Public Admonition & Order of Additional Educ., Nos.
16. Okla. Judicial Ethics Advisory Panel, Op. 2011-3 (July 6, 14-0820-DI & 14-0838-DI (Tex. Comm’n on Judicial Conduct
2011). Apr. 20, 2015) (alterations in original).
17. N.C. State Bar Council, 2014 Formal Ethics Op. 8 (Jan. 23, 28. Id.
2015). 29. Id.
18. In re Reines, No. 14-MA004 (14-4) (Fed Cir. Nov. 5, 2014) 30. ABA Comm. on Ethics & Prof’l Responsibility, Formal Op.
(alteration in original). 462 (Feb. 21, 2013).
19. United States v. Bank of Am. Corp., No. 1:12-cv-01422 31. Id.
(S.D.N.Y. Sept. 27, 2013). 32. Va. Code Ann. § 40.1-28.7:5.
20. Robertelli v. N.J. Ofice of Attorney Ethics, 134 A.3d 963 33. Md. Code Ann., Educ. § 26-401.
(N.J. 2016). 34. Okla. Stat. tit. 21, § 1040.13b(B).
21. Barry v. Medtronic Inc., No. 1:14-cv-00104 (E.D. Tex. 35. Id. § 1040.13b(C)(3).
Oct. 27, 2016). 36. Richard Winton & Veronica Rocha, Prosecutors Charge For-
22. Id. mer Playboy Playmate Dani Mathers in Gym “Body-Shaming”
23. N.Y. City Bar Ass’n Comm. on Prof’l Ethics, Formal Op. Photo Case, L.A. Times, Nov. 4, 2016, http://www.latimes.com/
2012-2 (May 30, 2012). local/lanow/la-me-body-shaming-20161104-story.html.
24. ABA Comm. on Ethics & Prof’l Responsibility, Formal Op. 37. Houston Woman Wins $500,000 in “Revenge Porn” Lawsuit,
466 (Apr. 24, 2014). ABC 7 News (Feb. 27, 2014), http://abc7news.com/archive/9447698/.
Meeting of the Minds
By Todd M. Martin and Pervin Taleyarkhan
Righting Inventorship Wrongs:

A Multijurisdictional Overview
I
nventorship is a small but critical formation in the mind of the inven- to take place, the transfer to another must
aspect of a patent application. The tor of a deinite and permanent idea of include the entirety of the bundle of rights
inventorship on a patent application the complete and operative invention that is associated with the ownership inter-
can (depending on both the territory as it is thereafter to be applied in prac- est, i.e., all of the bundle of rights that are
in which patent protection is sought tice.’”3 Further, it is those who, per the inherent in the right, title and interest in the
and when the application for patent facts of a particular situation, made a patent or patent application.”10
was iled) deine who qualiies as the conceptual contribution to the inven- The owner of a patent application may
owner of any resulting patent(s). Incor- tion as claimed who are entitled to be in turn transfer certain rights that are less
rect inventorship can render the patent inventors on a patent.4 This is true even than the entire ownership interest of a pat-
unenforceable, not to mention the pos- though each joint inventor need not ent. “An exclusive license may be granted
sible repercussions to those involved in have made a contribution to each and by the patent owner to a licensee” in
the drafting/examination, if there are every claim to be properly named as an which the exclusive licensee can prevent
suspicions. Errors in inventorship can inventor.5 In addition, “[c]o-inventors others, including the patent owner, “from
be discovered at any time: the initial il- need not ‘physically work together or competing with the exclusive licensee,
ing stage, during the examination stage, at the same time,’ ‘make the same type as to the geographic region, the length of
and even after the patent has issued. or amount of contribution,’ or ‘make time, and/or the ield of use, set forth in
Although errors in inventorship can a contribution to the subject matter of the license agreement.”11
usually be corrected, these errors can every claim of the patent.’”6
affect how and whether the patent can The process of identifying an inven- Who Gets to Enforce the Patent?
be enforced. Following is a brief survey tor is therefore very fact speciic and Under US law, in order to bring a law-
of international perspectives on inven- can change during the course of prose- suit for infringement, one of the irst
torship, using the United States and cution of a patent application. requirements is that the plaintiff have
Australia as examples. standing to sue the alleged infringer (i.e.,
Ownership of (vs. Inventorship in) a that the plaintiff is procedurally permit-
US Practice Patent and a Patent Application ted to bring this lawsuit). The “Patent
Inventorship Is the First Consideration Inventorship and ownership in a patent Act12 governs standing to sue for [pat-
Procedurally, a US application for pat- and patent application are treated as “sepa- ent] infringement, and it provides that
ent must include the name(s) of the rate issues.”7 “Ownership of a patent gives only the patentee and his successors in
inventor(s). This requirement traces its the patent owner the right to exclude oth- title are entitled to bring a civil action for
roots back to the United States Con- ers from making, using, offering for sale, infringement.”13 Further, “[a] party is a
stitution, which grants to Congress selling, or importing into the United States patentee if it holds legal title to the pat-
the power to “promote the Progress the invention claimed in the patent.”8 “For ent, either by issuance or assignment.”14
of Science and useful Arts, by secur- [patent] applications iled on or after Sep- However, as held in a 2014 court rul-
ing for limited Times to . . . Inventors tember 16, 2012, the original applicant ing, even though one may not be the
the exclusive Right to their respec- is presumed to be the initial owner of an patentee, the right to sue may still be
tive . . . discoveries.”1 Inventorship is application for an original patent. For transferred to a licensee if “all rights or
deined as simply the list of individu- applications iled before September 16, all substantial rights” in the patent have
als in the oficial documents iled with 2012, the ownership of the patent (or the been transferred via the license.15
the application (including those listed application for the patent) initially vests
on the application data sheet and/or in the named inventors of the invention of Consequences of Incorrect
the inventor’s oath or declaration).2 To the patent.”9 An owner of a patent or patent Inventorship
be properly characterized as an inven- application can transfer ownership interests As seen above, inventorship plays a critical
tor, United States patent law requires by properly assigning the patent or patent role in a patent application. This includes
that the individual have contributed application. “In order for an assignment identifying the initial owners (and thus the
to the “conception” of the invention.
“Conception has been deined as ‘the Todd M. Martin is a director and patent and trademark attorney with Eagar & Martin Pty
complete performance of the mental Ltd in Queensland, Australia. Pervin Taleyarkhan is an associate legal counsel for patents
part of the inventive act’ and it is ‘the with Whirlpool Corporation in Benton Harbor, Michigan.
future owners in the chain of title) of the especially after the implementation patent that is at issue, or one year from
patent or patent application. Incorrectly of certain provisions of the America the date of publication of the claim(s) at
listing the inventors on a patent applica- Invents Act (AIA) in 2012. issue in the patent application.24
tion, or even improperly assigning rights
(regardless of intent) in a patent or patent Before Issuance After Issuance
application, can lead to potential invalidity Before a patent issues, errors in inven- Once a patent has issued, the process
of the patent claims and can also change torship can be corrected simply by for correcting inventorship becomes
the ownership of a patent. submitting an updated application data slightly more involved. Corrections to
Inaccurate ownership in a patent can sheet that identiies each inventor by legal inventorship (whether to add or delete
lead to a host of deleterious consequences name, along with a processing fee.18 If a an inventor) are submitted by iling a
for those involved, both in and out of a change in inventorship is made to add an formal request on behalf of all parties
litigation setting. For example, if a paten- inventor who was not previously listed and assignees involved, along with a
tee should seek to bring an infringement in the current patent application, then processing fee.25 The request must be
lawsuit, he or she must have standing. As an inventor’s oath or declaration will be accompanied by a “statement from each
discussed above, only certain parties can required for the added inventor.19 person who is being added as an inven-
assert proper standing in a patent infringe- In addition, should there be a dis- tor and each person who is currently
ment lawsuit, namely, the patentee and/ pute on inventorship that does not named as an inventor either agreeing
or a licensee with appropriate showing result in amicable resolution, inventor- to the change of inventorship or stating
of having been granted all or at least all ship disputes on patent applications can that he or she has no disagreement in
substantial rights in the patent. In a nonliti- be resolved by more oficial means, regard to the requested change.”26
gation setting, a party holding itself out as depending on when the application was Inventorship disputes on issued pat-
a licensee of patent rights may in fact hold iled. For patent applications iled before ents may be settled in court27 or in the
an invalid license if it is discovered that the March 16, 2013, inventorship disputes USPTO. The exact choice of forum
licensor did not have the right to transfer can be resolved within the US Patent and depends on the available evidence, the
any of the patent rights to begin with. Trademark Ofice (USPTO) by way of amount the parties are willing to pay
A prime example of how errors that an interference proceeding. Interferences for the proceedings, and even the tim-
may have occurred as part of a series of are relatively uncommon for resolving ing of the initiation of the proceeding.
simple errors in inventorship, assignment inventorship disputes, however, in part For example, a derivation proceeding
documents, and chain of title can make or because inventorship is dependent on may not be appropriate because it may
break attempts to enforce a patent is STC. the claims, and the claims often change be more than one year from the date on
UNM v. Intel Corp.16 In STC.UNM, the US during prosecution.20 Therefore, until a which the patent issued.
Court of Appeals for the Federal Circuit patent issues, there is no certainty as to
afirmed dismissal of a patent infringe- the inventorship on a patent application. Tips and Good Practices
ment lawsuit for lack of standing because Another reason interference proceedings It is crucial to ensure that the inventorship
the co-owner “afirmatively retained [the are not typically used to resolve inven- listed on the patent or patent application
substantive] right by consistently” refusing torship disputes is due to their purposes is accurate at all times. Therefore, some
to join the patent infringement lawsuit.17 and the facts involved in the proceed- tips practitioners can implement into their
Though steps had been taken to rectify ing itself: an interference proceeding is practices include the following:
ownership errors during the course of the more of a “priority contest,” as opposed • Conducting regular check-ins
prosecution of the patent applications at to an inventorship dispute which can be with the inventors, especially if
issue, the fact that the plaintiff in STC. thought of as an “originality test.”21 the claims are amended;
UNM was not the 100 percent owner of In contrast, the AIA streamlined • Maintaining claim charts track-
the patent at issue and could not persuade inventorship corrections “by creating a ing the inventorship against the
the patent’s co-owner to join the patent derivation proceeding to ensure correct claims, even if they are amended;
infringement lawsuit thwarted the plain- inventorship” on applications iled on • Keeping track of not only the
tiff’s attempts to enforce its patent. or after March 16, 2013.22 As its name name(s) of the inventor(s) of each
Such an example highlights the suggests, a derivation proceeding sets claim, but also the circumstances
importance of keeping track of inven- out to determine whether “an individual surrounding their contributions; and
torship and ownership in a patent and named in an earlier application as the • When strategizing ownership of a
patent application, along with keep- inventor or a joint inventor derived such patent application and any result-
ing in mind the fact that one may need invention from an individual named in ing patents, it can be useful to keep
cooperation of all co-owners if an the [proceeding] petitioner’s applica- ownership in the patent to key par-
infringement suit is on the horizon. tion as the inventor or a joint inventor ties who are willing and able to
and, without authorization, the earlier bring infringement lawsuits.
Correcting Inventorship application claiming such invention was
Correcting inventorship in a patent or iled.”23 Petitions to initiate derivation Australian Practice
patent application iled in the United proceedings can only be iled within Under Australian law, in order to
States is relatively straightforward, one year from the issue date of the enforce a patent, one must have proper
entitlement to the patent. Ultimate enti- entitlement from the inventor by conduct, the whole of the speciication including
tlement may be derived in several ways, agreement, or assignment. Australian the claims. The body of the speciica-
but the starting point is through inven- courts have held that “s 15 speciies no tion describes the invention and should
torship. The consequences of improper formalities as being necessary for the explain the inventive concepts involved.
(or a lack of) entitlement can be severe. derivation of title to an invention from While the claims may claim less than
Therefore it is important that inventor- an inventor or from a person who, on the the whole of the invention, they repre-
ship is properly determined at the outset. grant of a patent, would be entitled to sent the patentee’s description of the
have the patent assigned.”36 Accordingly, invention sought to be protected and
Entitlement in General entitlement may be obtained orally37 or for which the monopoly is claimed.
“Entitlement” is deined as “a right to implied through conduct.38 The claims assist in understanding the
beneits speciied especially by law or The starting point of any entitlement invention and the inventive concept or
contract.”28 When used in the context of analysis is with the inventor as that is concepts that gave rise to it.40
patent ownership, it refers to the exclusive where entitlement irst originates. The
rights given by a patent to a patentee.29 entitlement of the inventor is ordinarily Determining Inventorship
This is due to the structure of the Patents straightforward unless there are multi- The Act under section 15(1)(a) pro-
Act 1990 (the Act). Under the Act, the ple inventors, or the named inventor is vides that a patent may be granted to
exclusive rights provided to the patentee not really a true inventor in relation to a person who is the inventor. The Act
are “personal property and are capable of the claimed subject matter. Where there does not contain a deinition for “inven-
assignment and of devolution by law.”30 are multiple inventors, entitlement may tor.” However, there are several cases
According to the deinition section of change depending on the contribution in Australia that provide guidance as to
the Act, “patentee means the person for (or lack thereof) of individual inventors. the determination of an “inventor.”
the time being entered in the Register as The question that must be answered in The Australian Federal Court for-
the grantee or proprietor of a patent.”31 such a situation is what contribution mulated a number of factors for
This deinition sets up a structure where is necessary before a person may be considering inventorship in the Pol-
the registered proprietor is treated “as deemed an “inventor” for purposes of wood case, which were subsequently
the owner of the patent subject to any entitlement to the invention. summarized in Neobev Pty Ltd v Bac-
interests in it created by the owner and chus Distillery Pty Ltd (Administrators
registered in the Register,” which thereby Determining Entitlement Appointed) [No. 3].41 These “Polwood
ensures “some certainty and inality” in Under Australian law, determination of factors” are set forth below.
regards to a title to a patent.32 Thus, to entitlement is not based on a claim-by-
be able to assert the patent rights, a per- claim analysis alone. Rather, it is based First, whether someone is properly
son must be recorded on the register to on a three-step approach, of which described as a joint inventor is not
be recognized as the patentee. However, inventorship is one of those steps. In determined by quantitative contribu-
it is not enough to be simply recorded particular, the Full Federal Court in tion, but rather, qualitative contribution.
as the patentee. The patentee must also Australia has endorsed the following The contribution does not have to be
have entitlement to the patent (i.e., have steps to be considered when assessing equal to the other person’s and the key
an ownership interest in the patent).33 The entitlement (“UWA questions”): question is whether there has been a
nature of a patent as property means that (1) Identify the “inventive concept” contribution to the invention.
a patentee’s ownership must have a clean of the invention as deined in the claims;
chain of title in order to have proper enti- (2) Determine inventorship Secondly, in some cases it may be help-
tlement.34 The consequences of invalid including the person responsible for the ful to look to the claims and in some
entitlement are set forth below. inventive concept and the time of con- cases evidence may assist. It is impor-
ception as distinct from its veriication tant to look at what the invention is said
Under section 15(1) of the Act, a patent and reduction into practice; and to be. For example, a contribution to
may only be granted to a person who: (3) Determine how many contrac- the construction of an apparatus may
(a) is the inventor; or tual or iduciary relationships give rise be suficient where the invention is the
(b) would, on the grant of a patent for to proprietary rights in the invention.39 apparatus and insuficient where the
the invention, be entitled to have the Each step is discussed in more detail construction of the apparatus can be
patent assigned to the person; or below. As will become apparent, the sec- done by simply following the instruc-
(c) derives title to the invention from ond step (determination of inventorship) tions in the speciication.
the inventor or a person mentioned can be the most dificult to perform.
in paragraph (b); or Thirdly, the key question is whether
(d) is the legal representative of a Identifying the “Inventive Concept” the person’s contribution had a mate-
deceased person mentioned in Australian courts take a holistic rial effect on the inal invention.
paragraph (a), (b) or (c).35 approach for determining the inven-
tive concept. According to Australian Fourthly, it is sometimes useful to
Thus, a patent may only be granted to authorities, the inventive concept is to approach the issue by asking who
an inventor, or someone who has obtained be ascertained from conceived the solution to a problem,
but that will not always be so because as well as the component parts and the The University of British Columbia
not all inventions are susceptible to a relationship between the participants.”48 (UBC) and Angiotech Pharmaceuticals
problem and solution analysis. The sixth factor (i.e., the “knowl- jointly iled a Patent Cooperation Treaty
edge of what is required” factor) (PCT) application. UBC had an assign-
Fifthly, rights to an invention are echoes the conception factor in that ment from two of the ive listed inventors.
determined by objectively assessing the alleged inventor must have an idea Angiotech had an assignment from the
contributions to the invention rather of the problem(s) being solved, rather other three listed inventors. At the time
than assessing the inventiveness of than following instructions to reduce national phase was entered in Australia,
respective contributions and if the inal the invention to practice (e.g., differ- all the inventors had contributed to the
concept of the invention would not entiating between the inal concept of claimed subject matter.
have come about without a particular an invention rather than a preferred During prosecution of the related
person’s involvement, then that person working embodiment of the inven- US application, certain claims were
has an entitlement to the invention. tion).49 As an example in the context of canceled which changed the inventor-
the university environment, this means ship of the US application. Speciically,
Finally, . . . a person may be consid- that a research assistant would have to the cancellation of claims resulted in
ered a joint inventor where they had actively contribute to the development UBC’s inventors being deleted from
a general idea of what was required, of a solution rather than just follow- the US application. The inventorship
but someone else was required to put ing someone’s directions to reduce the of record in the US application was
the ideas into effect and did so.42 invention to practice. amended to relect the changed scope
of the claims, and the resulting US pat-
The irst factor (i.e., the “qualitative” Determining Contractual/Fiduciary ent issued to Angiotech as the sole
factor) focuses on the quality of the Relationships assignee.57 Claim amendments corre-
contribution rather than the number The determination of contractual or sponding to those of the US application
of contributions. iduciary relationships is fairly straight- were made to the Australian applica-
The second factor (i.e., the “claims” forward compared to the determination tion so that, in effect, UBC’s inventors
factor) focuses on what is being of inventorship. In fact, this question were no longer contributors to the
claimed in order to deine the inven- might not be reached if it is determined claimed subject matter of the Austra-
tion. This is a familiar approach in the that an alleged inventor is not an inven- lian application. The patent request
United States.43 However, where the tor after all.50 The determination usually in the Australian application was not
inventive concept resides in a combi- involves assessing any contracts or amended to relect the changed inven-
nation of claimed elements, then “[o] actions between parties that may give torship. Therefore, UBC and Angiotech
ne must seek to identify who in sub- rise to an understanding of ownership.51 remained as co-applicants of the Aus-
stance made the combination. Who was Since the Neobev case in 2014, at least tralian application. A lower federal
responsible for the inventive concept, several decisions by the Australian patent court revoked the patent based on lack
namely the combination?”44 ofice have analyzed inventorship based on of entitlement.58 This decision was sub-
The third factor (i.e., the “material the UWA questions and Polwood factors.52 sequently reversed on appeal,59 but it
effect” factor) focuses on the material- highlights the pitfalls presented by lack
ity of an alleged inventor’s contribution. Consequences of Incorrect of entitlement. Since the UBC v Conor
In particular, “if a person is given part Entitlement Med case, the Act has been amended
of the information necessary to make Where it is demonstrated that an to reduce the risk of entitlement alone
an invention, and then applies their own applicant or patentee does not have being the basis for revocation.
endeavours they will be an inventor if their entitlement to the claimed invention,
contribution produces a material effect.”45 the application may be refused, or the Correcting Entitlement
The fourth factor (i.e., the “concep- patent revoked as the case may be.53 Australian law contains a variety of
tion” factor) looks to who contributed to In the situation of a pending appli- measures for correcting entitlement.
the conception of the invention. In par- cation for patent, it is a ground of These mainly depend on whether the
ticular, the Polwood court stated that “[f] opposition that the nominated person patent has been granted. Prior to pas-
or joint inventorship, each inventor must is either: “(i) not entitled to a grant of a sage of the Raising the Bar Act,60 the
generally contribute to the conception of patent for the invention; or (ii) entitled consequences of incorrect entitlement
the invention.”46 Additionally, the contri- to a grant of a patent for the invention at grant of the patent would have left
bution should be such as to necessarily but only in conjunction with some other a patent subject to revocation, as illus-
provide enablement to the invention.47 person.”54 Once the patent has been trated by the UBC v Conor Med case
The ifth factor (i.e., the “but for” granted, the patent may be subject to above. One of the changes implemented
factor) focuses on whether the inven- revocation on the ground “that the pat- by the Raising the Bar Act was in the
tion would have come about but for the entee is not entitled to the patent.”55 addition of a new subpart to section 138
alleged inventor’s contribution. When Consider, for example, the situation in (dealing with revocation of patents).
assessing the “but for” factor, “[o]ne must University of British Columbia v Conor Section 138 was amended to include a
have regard to the invention as a whole, Medsystems, Inc (UBC v Conor Med).56 subpart that a court “must not” make
an order to revoke the patent on the some other person.”66 Should the applica- Act. The claims of the resulting patent
ground that the patentee is not entitled tion be successfully opposed under this will have the priority date of the claims
to the patent “unless the court is satis- ground, the applicant may apply to the of the patent revoked.70
ied that, in all the circumstances, it is commissioner under section 33 of the Act
just and equitable to do so.”61 The Rais- to have the patent grant to the “eligible Preventative Measures
ing the Bar Act also saw the enactment persons” (i.e., the persons properly enti- One way in which to lessen the possi-
of new section 191A, which pertains tled to the grant of the patent). bility of encountering entitlement issues
to the commissioner’s power to rectify is to conduct an inventorship determina-
the register in instances where there is Correcting Entitlement after Grant of tion utilizing the Polwood factors. Once
incorrect entitlement. The amendments the Patent inventorship is determined, assignments
to the Patents Act were intended so that Once the patent has granted, the pat- should be obtained early.
“revocation is the exception, rather than ent request cannot be amended unless It is also advisable to ensure that
the rule” for lack of entitlement.62 accomplished through court action the patent request correctly relects
or administrative action by the com- the inventors, because the Federal
Correcting Entitlement Prior to Grant missioner.67 Each option is briely Court has revoked more than one pat-
Commissioner’s Power to Rectify discussed below. ent on the ground that the patent was
the Register (s 191A). As mentioned Order by the Court for Rectii- obtained by “false suggestion or mis-
above, section 191A of the Act is a new cation of the Register (s 192). Under representation.”71 It is also a ground of
section added by the Raising the Bar section 192 of the Act, a person may revocation, under section 138(3)(e) of
Act. Applicant(s) may now apply to the apply to the court for an order to rec- the Act, where an amendment of the
commissioner to rectify the register to tify the register where the person was patent request “was made by fraud,
correct entitlement. aggrieved by the omission of an entry false suggestion or misrepresentation.”
Disputes between Joint Applicants from the register; an entry made in the Additionally, the explanatory memo-
(s 32). Entitlement may need correction register without suficient cause, an entry randum behind the Raising the Bar Act
due to a dispute between two or more wrongly existing in the register, or an notes several situations where revo-
“joint applicants.” Where such a dispute error or defect in an entry in the register. cation is appropriate based on lack of
arises, a request under section 32 of the Declaration by the Court Arising entitlement, such as when none of the
Act may be made for the commissioner Out of Revocation (s 34). Entitlement persons to whom the patent was granted
to make a determination as to what may be corrected if, during a court pro- are correctly entitled to the patent, or
names the application will proceed. ceeding, the court is satisied that the if correctly entitled persons have not
Application by an Eligible Person patent was granted to an applicant who did acted in good faith or have been grossly
(s 36). Sometimes a patent application is not have entitlement from all the inventors, negligent in permitting the patent to be
made by an applicant who does not have or the patentee was not an eligible person granted to incorrectly entitled persons.72
entitlement, or may have entitlement, but but at least one other person was an “eli- The above summarized approaches
in conjunction with one or more other gible person” (see deinition above). Upon to inventorship in both the United States
eligible persons. The Act deines an “eli- obtaining such a declaration, an applica- and Australia highlight the importance
gible person” as “a person to whom a tion may be made under section 34 of the of correctly identifying the inventors in
patent for the invention may be granted Act for the commissioner to grant a patent a patent application. Consequences for
under section 15.”63 An eligible person for the invention to the persons declared to errors in inventorship can go as far as
may include another party not yet named be eligible persons by the court. refusal to grant patent rights or revoking
as an applicant. An eligible person may An adverse consequence of using sec- patent rights that may have already been
apply for a declaration by the commis- tion 34 is that “[t]he ‘rectiied grantee’ granted. Though there are similarities,
sioner that the eligible person has an acquires rights in respect of infringement patent law in different countries may
entitlement to the invention disclosed only prospectively.”68 Thus, a remedy vary in the iner details behind inven-
in the subject patent application. There- for infringement of a new patent granted torship determination. Keeping track of
after, the commissioner may allow the under section 34 would only lie from the inventorship throughout the patenting
application to proceed in the name(s) of date of the publication of the speciica- process, and consulting with local coun-
the persons declared to be eligible.64 tion relating to the application for patent sel on the standards for inventorship in
Opposition Based on Lack of Enti- under section 34.69 a particular jurisdiction as needed, and
tlement (s 33). After acceptance of the Declaration by the Commissioner promptly correcting any inventorship
application, there is a three-month oppo- following Revocation (s 35). A paten- errors are therefore critical steps in the
sition period where an opponent may tee may apply to the commissioner to patenting process. n
oppose the grant of the patent.65 One of have the patent revoked. Once the pat-
the grounds of opposition is that the nom- ent is revoked, one or more “eligible Endnotes
inated person is either: “(i) not entitled persons” in relation to the invention 1. u.S. coNST. art. I, § 8, cl. 8.
to a grant of a patent for the invention; or as claimed in the revoked patent may 2. See, e.g., Christopher A. Rothe,
(ii) entitled to a grant of a patent for the apply for a patent in the name of the Fixing Inventorship Problems in U.S.
invention but only in conjunction with eligible persons under section 35 of the Patent Applications and U.S. Patents,
RatnerPrestia (Feb. 16, 2014), https:// Dictionary, https://www.merriam-webster. 49. See Falkenhagen v Polemate Pty Ltd
www.ratnerprestia.com/2014/02/16/ com/dictionary/entitlement) (last visited [1995] APO 32 (Austl.).
ixing-inventorship-problems-in-u-s-patent- July 25, 2017). 50. See, e.g., Oakmoore Pty Ltd v ARB
applications-and-u-s-patents/. 29. See generally Patents Act 1990 (Cth) Corp Ltd [2015] APO 66 (Austl.).
3. U.S. Pat. & Trademark Office, s 13 (Austl.). 51. See, e.g., Gen Transp Equip Pty Ltd
Manual of Patent Examining Proce- 30. Patents Act 1990 (Cth) s 13(2). v. Tytec Logistics Pty Ltd [2015] APO 91,
dures (MPEP) § 2138.04 (9th ed. Rev. 7, 31. Patents Act 1990 (Cth) sch 1. ¶¶ 60–65.
July 2015) (quoting Townsend v. Smith, 36 32. Stack v Brisbane City Council [1999] 52. See, e.g., Oakmoore Pty Ltd v ARB
F.2d 292, 295 (C.C.P.A. 1930)). FCA 1279, ¶ 38 (Austl.). Corp Ltd [2015] APO 66; Gen Transp Equip
4. See 35 U.S.C. § 116(a). 33. See, e.g., Patents Act 1990 (Cth) s Pty Ltd v Tytec Logistics Pty Ltd [2015]
5. See id. 138(3)(a). APO 91.
6. Vapor Point LLC v. Moorhead, 832 34. See Stack v Brisbane City Council 53. Patents Act 1990 (Cth) ss 59(a),
F.3d 1343, 1349 (Fed. Cir. 2016) (quoting [1999] FCA 1279, ¶ 52. 138(3)(a).
35 U.S.C. § 116). 35. Patents Act 1990 (Cth) s 15(1). 54. Patents Act 1990 (Cth) s 59(a).
7. See id. at 1350 (quoting Beech Air- 36. Univ of BC v Conor Medsystems, Inc 55. Patents Act 1990 (Cth) s 138(3)(a).
craft Corp. v. EDO Corp., 990 F.2d 1237, (UBC v Conor Med) [2006] FCAFC 154, 56. UBC v Conor Med [2006] FCAFC
1248 (Fed. Cir. 1993)). ¶ 37 (Austl.). 154.
8. MPEP, supra note 3, § 301 (citing 35 37. Speedy Gantry Hire Pty Ltd & Anor 57. Id. ¶ 2.
U.S.C. § 154(a)(1)). v Preston Erection Pty Ltd (1998) 40 IPR 58. Conor Medsystems, Inc v Univ of BC
9. Id. (citation omitted). 543, 550 (Austl.). [No. 2] (Conor Med v UBC) [2006] FCA 32
10. Id. 38. Id.; UBC v Conor Med [2006] (Austl.).
11. Id. FCAFC 154, ¶ 37. 59. UBC v Conor Med [2006] FCAFC
12. 35 U.S.C. §§ 1–376. 39. Univ of W Austl v Gray (UWA) 154.
13. Azure Networks, LLC v. CSR PLC, [2009] FCAFC 116, ¶ 253 (Austl.). 60. Intellectual Property Laws Amend-
771 F.3d 1336, 1342 (Fed. Cir. 2014). 40. Polwood Pty Ltd v Foxworth Pty Ltd ment (Raising the Bar) Act 2012, No. 35
14. Id. (Polwood) [2008] FCAFC 9, ¶ 61 (Austl.). (Austl.).
15. Id. 41. [2014] FCA 4, ¶ 108 (Austl.). 61. Patents Act 1990 (Cth) s 138(4).
16. 754 F.3d 940 (Fed. Cir. 2014). 42. Id. (citations omitted). 62. Explanatory Memorandum, Intellec-
17. Id. at 946. 43. See, e.g., 35 U.S.C. §§ 115, 116; 37 tual Property Laws Amendment (Raising the
18. See 37 C.F.R. § 1.48(a). C.F.R. § 1.63(a)(4). Bar) Bill 2011 (Cth) item 75.
19. See id. § 1.48(b). 44. Henry Bros (Magherafelt) Ltd v 63. Patents Act 1990 (Cth) sch 1.
20. See Ian Y. Liu & Leslie A. Ministry of Defence [1997] RPC 693, 706 64. Patents Act 1990 (Cth) s 36(3A).
McDonell, AIA Breathes Life into Inven- (quoted with approval in Gen Transp Equip 65. Patents Regulations 1991 (Cth) s
torship Correction in PTO, BNA’s Pat. Pty Ltd v. Tytec Logistics Pty Ltd [2015] 6.2(1).
Trademark & Copyright J., Nov. 1, 2013, APO 91) (Austl.). 66. Patents Act 1990 (Cth) s 59(a).
http://www.innegan.com/resources/articles/ 45. Merk Co v Sherman [2007] APO 9, 67. Patents Regulations 1991 (Cth) s
articlesdetail.aspx?news=12c99bf6-30bc- ¶ 28 (Austl.). 10.3(9).
4d6b-8956-e07b2fec420c. 46. Polwood [2008] FCAFC 9, ¶ 48 68. GS Tech Pty Ltd v Elster Metering
21. Id. (citing Price v. Symsek, 988 F.2d (quoting Shum v. Intel Corp., 499 F.3d 1272 Pty Ltd [2008] FCA 17, ¶ 79.
1187, 1190 (Fed. Cir. 1993)). (Fed. Cir. 2007)). 69. Id.
22. Id. 47. Univ of Southhampton’s Applications 70. Patents Act 1990 (Cth) s 35(1B).
23. 35 U.S.C. § 135(a)(1). [2006] RPC 21, ¶ 39 (“In the context of 71. See, e.g., Conor Med v UBC [2006]
24. Id. § 135(a)(2). entitlement to a patent a mere, non-enabling FCA 32, ¶ 20; JMVB Enters Pty Ltd v
25. See 37 C.F.R. § 1.324(a). idea, is probably not enough to give the pat- Camolag Pty Ltd [2005] FCA 1474, ¶¶ 136,
26. See id. § 1.324(b) (emphasis added). ent for it to solely the devisor. Those who 150 (“An incorrect statement to the Com-
27. See, e.g., Vapor Point LLC v. Moor- contribute enough information by way of missioner as to the identity of the inventor
head, 832 F.3d 1343 (Fed. Cir. 2016) (“[S] necessary enablement to make the idea pat- of a patent application which is later granted
ection 256 . . . explicitly authorizes judicial entable would count as ‘actual devisors’, will make the patent susceptible to revoca-
resolution of co-inventorship contests over having turned what was ‘airy-fairy’ into that tion on the ground of false suggestion or
issued patents.” (quoting MCV, Inc. v. King- which is practical.”) (referred to in Polwood misrepresentation.” (citations omitted)).
Seeley Thermos Co., 870 F.2d 1568, 1570 [2008] FCAFC 9, ¶ 44) (Austl.). 72. Explanatory Memorandum, Intellec-
(Fed. Cir. 1989))). 48. JMVB Enters Pty Ltd v Camolag Pty tual Property Laws Amendment (Raising the
28. Entitlement, Merriam-Webster Ltd [2005] FCA 1474, ¶ 132 (Austl.). Bar) Bill 2011 (Cth) item 75.
Decisions in Brief
By John C. Gatz
COPYRIGHTS
Copyright Registration Occurs after Copyright stations and copyright holders (collectively Fox) who sued
Ofice Acts on Application Aereokiller, now known as FilmOn X (FilmOn) for copyright
Fourth Estate Public Beneit Corp. v. Wall-Street.com, LLC, infringement. FilmOn operates a service that uses antennas to
856 F.3d 1338, 122 U.S.P.Q.2d 1586 (11th Cir. 2017). Fourth capture over-the-air broadcast programming and retransmits
Estate is a news organization that produces online content. the programming over the Internet to paying subscribers. The
Wall-Street.com is a website that licensed many Fourth Estate Supreme Court recently held that such a service does perform
articles. The license required Wall-Street.com to remove the retransmitted works publicly, and hence infringes the
all Fourth Estate content when Wall-Street.com cancelled copyright holders’ exclusive performance rights.
its account with Fourth Estate. Wall-Street.com cancelled In its defense, FilmOn claims that it is a “cable system” eli-
its account with Fourth Estate, but did not remove the arti- gible for a compulsory license. Under §111 of the Act, a “cable
cles from the website, so Fourth Estate sued for copyright system” is eligible for a compulsory license that allows it to
infringement. Wall-Street.com moved to dismiss the suit and retransmit “a performance or display of a work” that had origi-
argued that Fourth Estate had not registered the copyright in nally been broadcast by someone else—even if such material
the articles. The district court agreed with Wall-Street.com is copyrighted—without having to secure the consent of the
and dismissed the complaint, and Fourth Estate appealed. copyright holder. The Copyright Act deines “cable system” as
The Eleventh Circuit afirmed and began its analysis by not- “a facility … that in whole or in part receives signals transmit-
ing that a split exists among the appellate circuits regarding when ted or programs broadcast by one or more television broadcast
copyright registration occurs. The Tenth Circuit requires the Reg- stations licensed by the FCC, and makes secondary transmis-
ister of Copyrights to act on an application before a copyright is sions of such signals or programs by wires, cables, microwave,
registered and the copyright owner may bring a suit for copyright or other communications channels to subscribing members of
infringement. However, the Ninth and the Fifth Circuits allow the public who pay for such service.”
a copyright infringement suit to occur if a copyright application The Ninth Circuit reversed the district court’s partial
has been iled with the Copyright Ofice, even if the application summary judgment in favor of defendants, and held that Inter-
has not been acted upon by the copyright ofice. Looking to the net-based retransmission services are not eligible for the
language of the Copyright Act, the Eleventh Circuit decided that compulsory license that §111 makes available to “cable sys-
registration occurs after the Register of Copyrights examines the tems.” The Ninth Circuit concluded that §111 was ambiguous
application and issues a certiicate of registration. on the question of whether an Internet transmission provider
is a “cable system.” The Ninth Circuit deferred to the Copy-
TV over Internet Not a “Cable Company” right Ofice’s interpretation, which requires that “a provider of
Fox Television Stations, Inc. v. Aereokiller, LLC, 851 F.3d broadcast signals [must] be an inherently localized transmis-
1002 (9th Cir. 2017). Plaintiffs are a group of broadcast sion media of limited availability to qualify as a cable system.”
PATENTS
Anticipation Claim Construction
In re Chudik, 851 F.3d 1365, 122 U.S.P.Q.2d 1146 (Fed. Cir. Core Wireless Licensing S.a.r.l. v. Apple Inc., 853 F.3d 1360,
2017). The Federal Circuit reversed the PTAB’s inding that 122 U.S.P.Q.2d 1452 (Fed. Cir. 2017). The Federal Cir-
two references each anticipated selected claims of the appli- cuit afirmed the district court’s denial of Core Wireless’s
cation. The Federal Circuit found that substantial evidence motion for JMOL of infringement, while approving the dis-
did not support the PTAB’s anticipation indings because the trict court’s construction of a means-plus-function limitation.
PTAB had to modify the references—either by removing a fea- The construction required that, for Apple’s cellphones to
ture or relocating a feature —to disclose every claim limitation. infringe, the phones must be able to make what was called
Nidec Motor Corp. v. Zhongshan Broad Ocean Motor Co., 851 a “channel selection decision.” To support the construction,
F.3d 1270, 122 U.S.P.Q.2d 1116 (Fed. Cir. 2017). The Federal Cir- the Federal Circuit noted that each embodiment implemented
cuit reversed the PTAB’s inding that the patent was anticipated. the channel selection decision at the “mobile station,” which
The Federal Circuit reversed the decision and noted that anticipa- Core Wireless equated with Apple’s cellphone. The use of the
tion cannot exist where a reference lacked a limitation—even if a term “advantageously” to describe the embodiments failed
person of skill would have envisaged the missing limitation. to render those embodiments merely exemplary. The patent’s
John C. Gatz is a member of the irm Nixon Peabody in Chicago, Illinois. Column contributors include the following writers: Copyrights:
Zachary J. Smolinski, Smolinski Law PC; Michael N. Spink, Brinks, Hofer & Lione; Mark R. Anderson, Akerman LLP. Patents: Cynthia K.
Barnett, Johnson & Johnson; R. Trevor Carter, Daniel M. Lechleiter, Andrew M. McCoy, Faegre Baker Daniels LLP; Robert W. (Bill) Mason,
CaptureRx; Peter J. Prommer, Nixon Peabody LLP. Trade Secrets: R. Mark Halligan, FisherBroyles LLP. Trademarks: Janet M. Garetto and
Elizabeth W. Baio, Nixon Peabody LLP; Amy L. Sierocki
prosecution history, along with extrinsic evidence, including a Inventorship/Exceptional Cases
presentation made to a European telecommunications group, Univ. of Utah v. Max-Planck-Gesellschaft, 851 F.3d 1317,
supported the Federal Circuit’s holding. 122 U.S.P.Q.2d 1057 (Fed. Cir. 2017). The Federal Circuit
The Meds. Co. v. Mylan, Inc., 853 F.3d 1296, 122 afirmed the district court’s inding that the case was not
U.S.P.Q.2d 1217 (Fed. Cir. 2017). The Federal Circuit exceptional and grant of the defendant’s motion for summary
afirmed-in-part and reversed-in-part the district court’s inding judgment on a joint inventorship issue. The evidence did not
on the issue of infringement of two patents. The Federal Circuit support a inding of collaboration between the University of
construed the claims to require “eficient mixing” as part of the Utah and Max Planck’s inventors. While the mini-review by
batches’ limitation. The Federal Circuit found the “eficient the Utah inventor was integral to the Max Planck inventors’
mixing” element was required to yield a workable claim con- research, the mini-review was already in the public domain
struction. To determine what “eficient mixing” would mean to by the time the Max Planck’s inventors relied on it.
one of ordinary skill in the art, the Federal Circuit referred to
the speciication and Example 5 in the speciication. Marking
TVIIM, LLC v. McAfee, Inc., 851 F.3d 1356, 122 U.S.P.Q.2d Rembrandt Wireless Techs., LP v. Samsung Elecs. Co., 853 F.3d
1381 (Fed. Cir. 2017). The Federal Circuit afirmed the jury’s 1370, 122 U.S.P.Q.2d 1301 (Fed. Cir. 2017). The Federal Cir-
determination that (1) the defendant did not infringe the cuit afirmed the district court’s claim construction and indings
asserted patent; and (2) the patent was invalid. The Federal of infringement and validity. However, the denial of the motion
Circuit also afirmed the denial of the plaintiff’s post-verdict based on the marking statute was vacated and remanded. Rem-
motions for JMOL and a new trial. TVIIM failed to seek con- brandt licensed the patent to a party who sold unmarked products
struction of certain claim terms, and the Federal Circuit held embodying a claim that was later disclaimed by Rembrandt. The
that TVIIM could not be allowed to create a new claim con- Federal Circuit stated that allowing Rembrandt to use statutory
struction dispute following the close of the jury trial. disclaimer to avoid the consequences of its failure to mark under-
mines the public notice function of the marking statute.
Collateral Estoppel
Phil-Insul Corp. v. Airlite Plastics Co., 854 F.3d 1344, Obviousness
122 U.S.P.Q.2d 1441 (Fed. Cir. 2017). The Federal Circuit Icon Health & Fitness, Inc. v. Strava, Inc., 849 F.3d 1034, 122
afirmed the district court’s summary judgment of nonin- U.S.P.Q.2d 1238 (Fed. Cir. 2017). The Federal Circuit afirmed-
fringement based on collateral estoppel. Here, the patent in-part, vacated-in-part, and remanded the PTAB’s rejection
owner asserted the same infringement claims against products of all claims being obvious. The Federal Court considered
having the same design as in an earlier case that the patent whether the appellant had waived its right to contest the Exam-
owner had lost at the Federal Circuit. iner’s reliance on an expert. The Federal Circuit found enough
considerations existed allowing the Federal Circuit to exercise
Exceptional Case discretion and decide the issue. On selected claims, the Federal
Bayer CropScience AG v. Dow Agrosciences LLC, 851 F.3d Circuit found both the PTAB and the Examiner did not make
1302, 122 U.S.P.Q.2d 1052 (Fed. Cir. 2017). The Federal any factual indings and only incorporated the attorney’s argu-
Circuit afirmed the district court’s inding that the case was ments. Attorney’s arguments are not evidence. Therefore, the
exceptional and awarded attorney’s fees because the district Federal Circuit vacated the PTAB’s rejection of those claims.
court did not abuse its discretion. The district court found the Novartis AG v. Noven Pharm. Inc., 853 F.3d 1289, 122
case was exceptional because of the infringers’ weak position U.S.P.Q.2d 1195 (Fed. Cir. 2017). The Federal Circuit afirmed
on the merits and litigation conduct. the PTAB’s inal decisions that various claims of the patents
would have been obvious. The Federal Circuit rejected Novartis’s
Inter Partes Review argument that the PTAB’s decisions on obviousness were subject
In re Afinity Labs of Tex., LLC, 856 F.3d 902, 122 U.S.P.Q.2d to prior judicial opinions. Not only were the records different in
1493 (Fed. Cir. 2017). The Federal Circuit afirmed the PTAB’s the prior litigation, but the Federal Circuit noted that the petitioner
inding that certain claims were invalid. The Federal Circuit in an inter partes review proves unpatentability by a preponder-
found the estoppel provision of pre-AIA section 317(b) was not ance of the evidence rather than clear and convincing evidence as
a bar because the district court’s dismissal of claims of invalidity required in district court litigation, meaning that the PTAB prop-
without prejudice does not present a inal decision that the party erly may reach a different conclusion based on the same evidence.
failed to sustain its burden of invalidity of those claims. Novartis AG v. Torrent Pharma. Ltd., 853 F.3d 1316, 122
In re Afinity Labs of Tex., LLC, 856 F.3d 883, 122 U.S.P.Q.2d U.S.P.Q.2d 1289 (Fed. Cir. 2017). The Federal Circuit afirmed the
1497 (Fed. Cir. 2017). This case is related to the one above. Simi- PTAB’s analysis of the evidence and inding of obviousness in two
larly, the Federal Circuit found estoppel did not apply. consolidated inter partes review proceedings. The PTAB found all
Wasica Fin. GmbH v. Cont’l Auto. Sys., Inc., 853 F.3d the claims invalid along with the proposed substitute claims.
1272, 122 U.S.P.Q.2d 1267 (Fed. Cir. 2017). The Federal
Circuit afirmed-in-part and reversed the PTAB’s indings Patent Ineligibility
of certain claims being unpatentable and other claims being RecogniCorp, LLC v. Nintendo Co., 855 F.3d 1322, 122
patentable in an inter partes review. In an IPR, the Federal U.S.P.Q.2d 1377 (Fed. Cir. 2017). The Federal Circuit
Circuit reviews PTAB’s legal conclusions de novo. afirmed the district court’s judgment on the pleadings that
the claims were directed to an abstract idea and did not the rejection of patent claims. The Federal Circuit recognized
contain an inventive concept suficient to render the pat- that if a defendant brought an invalidity challenge in a district
ent eligible under 35 U.S.C. § 101. The Federal Circuit held court litigation and was unsuccessful, it is not permitted to
that adding one abstract idea to another abstract idea did not bring the same challenge in inter partes reexamination. This
render the claim non-abstract. The claims lack an inventive restriction applies when all appeals have terminated, which
concept that transforms the claimed subject matter from an the Federal Circuit found was precisely the situation here.
abstract idea into a patent-eligible application.
Reexamination Proceedings
Permanent Injunctions In re AT&T Intellectual Prop. II, LP, 856 F.3d 991, 122
Asetek Danmark A/S v. CMI USA Inc., 852 F.3d 1352, 122 U.S.P.Q.2d 1509 (Fed. Cir. 2017). The Federal Circuit afirmed
U.S.P.Q.2d 1182 (Fed. Cir. 2017). The Federal Circuit afirmed the PTAB’s decision that the representative claim was invalid
the district court’s rulings on infringement, invalidity, and dam- based on prior art. After its request for a reexamination was
ages. The Federal Circuit remanded the part of the injunction granted, the requester asked for the request to be denied. The
that went beyond abetting a new violation by CMI. Here, the PTAB denied the request and continued with the re-examina-
Federal Circuit found that a determination of the propriety of tion. The Federal Circuit held the PTAB’s decision to be the
the injunction’s reach would beneit from further indings and, correct one as the statute requires a request and requester and
if sought and needed, further develop the record. those conditions were met. The Federal Circuit then continued
Nichia Corp. v. Everlight Ams., Inc., 855 F.3d 1328, 122 to afirm the PTAB’s decision on the inding of anticipation.
U.S.P.Q.2d 1429 (Fed. Cir. 2017). The Federal Circuit afirmed
the district court’s inding that three LED-related patents were Various Issues
infringed and not invalid, but that a permanent injunction was Mentor Graphics Corp. v. EVE-USA, Inc., 851 F.3d 1275,
not warranted. The district court found that the patentee, Nichia, 122 U.S.P.Q.2d 1120 (Fed. Cir. 2017). The Federal Circuit
failed to demonstrate that past and any continuing infringing (1) afirmed the district court’s denial of Synopsis’s (parent
activities had caused or would cause it irreparable harm and that company EVE-USA) motion for JMOL that its products did
Nichia could be adequately compensated for infringement with not infringe selected claims of the ‘376 patent; (2) afirmed
money damages. In particular, the record showed that Nichia had the district court’s application of assignor estoppel to Syn-
little meaningful competition in the LED market; Nichia failed opsis’s ability to challenge the ’376 patent; (3) afirmed the
to establish harm due to lost sales or price erosion; and Nichia district court’s damages; (4) reversed the district court’s ind-
licensed the asserted patents to major competitors, which sug- ing that the word “near” was indeinite; (5) afirmed the
gested that the harm due to infringement was not irreparable. district court’s inding that selected claims of the ‘526 pat-
ent were patent ineligible; (6) reversed the district court’s
Practice/Procedure written description invalidity inding for selected claims of
Fairchild (Taiwan) Corp. v. Power Integrations, Inc., 854 the ‘882 patent relying on the originally iled claims; and (7)
F.3d 1364, 122 U.S.P.Q.2d 1395 (Fed. Cir. 2017). The Fed- reversed the district court’s summary judgment ruling that
eral Circuit granted the patent owner’s motion to remand to claim preclusion barred Mentor’s assertion of the ‘531 and
the PTAB with instructions to vacate its decision afirming ‘176 patents.
TRADE SECRETS
Advanced Fluid Sys. v. Huber, 2017 WL 2445303, 2017 of irreparable harm because given the substantial overlap
U.S. Dist. LEXIS 86145 (D. Pa. 2017). Ownership, in the between the employee’s work for the former employer and his
traditional sense, is not a prerequisite to a trade secret mis- intended work for the new employer, same role, same industry,
appropriation claim. AFS needed to demonstrate only lawful and same geographic region, the district court was well within
possession of a trade secret to maintain its claim for trade its discretion to conclude that he would likely use his coni-
secret misappropriation. The undisputed evidence established dential knowledge to the former employer’s detriment. The
that AFS used reasonable efforts to keep its information threatened misappropriation of trade secrets may be enjoined.
secret and that it shared its engineering iles only as neces- The misappropriation of trade secrets need not have already
sary. There is likewise no dispute that AFS expended copious occurred to warrant injunctive relief.
resources developing the system, and that the fact that AFS Jacked Up, LLC v. Sara Lee Corp., 854 F.3d 797 (5th Cir.
employees are not bound by conidentiality agreements did 2017). The district court conducted an extensive choice of law
not affect the weighted balance of this analysis. analysis and found that Ohio law governs the trade secret claim
Fres-Co Sys. USA v. Hawkins, 2017 WL 2376568, 2017 iled in Texas. Under the “most signiicant relationship” test
U.S. App. LEXIS 9679 (3d Cir. 2017). The Third Circuit found used by Texas courts, there are four factors to consider in deter-
no abuse of discretion and afirmed the district court’s court mining the applicable law for a tort case: (1) the place where
decision granting the preliminary injunction to the former the injury occurred; (2) the place where the conduct causing
employer. The district court did not err in inding a likelihood the injury occurred; (3) the residence, nationality, and place of
business of the parties; and (4) the place where the relationship the implementation date. Whether pre-enactment conduct is
between the parties is centered. In trade secret misappropria- actionable under the DTSA depends on the plaintiff’s the-
tion cases, the principal location of the defendant’s conduct ory of liability. Under the DTSA, prohibited misappropriation
is given weight greater than the place of injury. Even though includes both the acquisition of a trade secret and its disclo-
the place of injury to Jacked Up was Texas, Ohio law gov- sure or use. Under an acquisition theory of liability, a DTSA
erns plaintiff’s trade secret misappropriation claim because claim is only actionable if the trade secret was acquired after
Smucker allegedly misappropriated the trade secrets in Ohio. the effective date of the Act. However, under a disclosure/use
Sleekez, LLC v. Horton, 2017 WL 1906957, 2017 U.S. theory of liability, a DTSA claim is actionable when the disclo-
Dist. LEXIS 71410 (D. Mont. 2017). The DTSA went into sure or use continued to occur after the effective date. Here, the
effect on May 11, 2016. Therefore, to assert a claim under the plaintiff is pursuing a disclosure/use theory of liability so there
Act, the plaintiff must allege an act of misappropriation after is DTSA jurisdiction.
TRADEMARKS
Descriptiveness/Standard Character Mark the function of the goods, i.e., that they sharpen knives.
In re Calphalon Corp., 122 U.S.P.Q.2d 1153 (TTAB 2017). Cal- Moreover, Calphalon’s arguments that the mark SHARPIN
phalon appealed the refusal of registration of the mark SHARPIN was incongruous and a double entendre were not persuasive,
for “cutlery knife blocks which incorporate built-in sharpeners and the decision to refuse registration was afirmed.
that automatically sharpen knives” on the basis that the mark was
merely descriptive for the applied-for goods. The TTAB afirmed. Surnames
The TTAB initially decided whether the mark should In re Beds & Bars Ltd., 122 U.S.P.Q. 2d 1546 (TTAB 2017).
be treated as “SHARPIN” (the standard character mark) The applicant sought registration on the Principal Register
or “SharpIN” as a special form mark based on Calphalon’s of the mark BELUSHI’S (in standard character format) for
amended drawing. The TTAB decided that because Calpha- travel – and hospitality-related services. The Examining Attor-
lon had not altered the original standard character designation ney refused registration of the mark pursuant to Section 2(e)
and had not chosen the special form option that would have (4) of the Trademark Act on the ground that the mark is pri-
limited the mark to a “particular font style, size and color,” it marily merely a surname. The applicant appealed, and the
was appropriate to treat the mark in the amended drawing as a TTAB afirmed. The TTAB noted that neither the applicant nor
standard character mark. Thus, there was no basis to remand the Examining Attorney presented any evidence showing that
the application to the Examining Attorney on this issue. On BELUSHI has a meaning other than a surname or that it has
the descriptiveness issue, the TTAB clariied that the test for any alternative meaning. Although the TTAB conceded that
descriptiveness is not whether someone who is presented with BELUSHI was an exceedingly rare surname, it found that the
the mark could guess what the goods are, but rather whether celebrity and continuing media attention of brothers John and
someone who knows what the goods are will understand that Jim Belushi supported a inding that a substantial portion of
the mark conveys information about the goods. Under that Americans know BELUSHI to be a surname. Thus, the refusal
standard, the TTAB found that the mark SHARPIN evoked to register the applicant’s proposed BELUSHI’S mark pursuant
an immediate association with the word “sharpen” to describe to Section 2(e)(4) of the Trademark Act was afirmed.
Additional case Decisions in Brief can be found exclusively online at

www.americanbar.org/publications/landslide/2017–2018/September-October/decisions_brief.html
Perspective Continued from page 1
eventually obtain the inancial resources to modernize, and at last help shape the times ahead and to make them more the best
update itself to the digital age? One thing seems certain: continu- of times from your perspective. We welcome your active par-
ation as is would be the worst of times by all users but the best of ticipation in our efforts—to join your own voice with the
times for invested government interests. powerful voice of our Section and the ABA. We don’t know
And inally the good times appear to be rolling for trade how the tale will unfold, if wisdom will prevail, or if this will
secret owners and practitioners. But just wait. Even though be a time of foolishness. But one thing is certain: every player
the Defend Trade Secrets Act may be too new to have in this drama counts. So we invite you to be an active part of
revealed signiicant defects, a few voices are already ques- the story by adding your talents to those who have labored
tioning whether it will live up to its hype. over all the above issues during the last few years. Thank you
As members of our Section, you have the opportunity to for your membership and participation. n
Sound Marks Continued from page 43
Already Knows You, N.Y. Times, May 18, 2016 (discussing the recent 24. Registration No. 5,130,818 (listen to the July 13, 2016, Evidence at
inundation of voice-activated home assistant devices such as Amazon http://tsdr.uspto.gov/#caseNumber=5130818&caseSearchType=US_APPLI
Echo and Google Home). According to Google’s chief executive, Sun- CATION&caseType=DEFAULT&searchType=documentSearch).
dar Pichai, Google Home—a voice-activated speaker powered by Google 25. Registration No. 5,042,077 (listen to the March 16, 2015, Mark at
Assistant—performs functions through a simple voice request because http://tsdr.uspto.gov/#caseNumber=5042077&caseSearchType=US_APP
“[w]e want users to have an ongoing two-way dialogue with Google.” Id. LICATION&caseType=DEFAULT&searchType=documentSearch).
3. Registration No. 5,194,272 (listen to the March 31, 2016, Specimen 26. TMEP, supra note 10, § 1202.15.
at http://tsdr.uspto.gov/#caseNumber=5194272&caseSearchType=US_APP 27. Id. (stressing that sounds may be registered on the Principal
LICATION&caseType=DEFAULT&searchType=documentSearch). Register when they are “arbitrary, unique or distinctive” in the mind
4. Registration No. 4,689,043 (listen to the April 26, 2012, Mark at of the listener).
http://tsdr.uspto.gov/#caseNumber=4689043&caseSearchType=US_APP 28. In re Gen. Elec. Broad. Co., 199 U.S.P.Q. 560, 562–63
LICATION&caseType=DEFAULT&searchType=documentSearch). (T.T.A.B. 1978).
5. Registration No. 2,315,261 (listen to the sound mark at https:// 29. TMEP, supra note 10, § 1202.15.
www.uspto.gov/sites/default/iles/75332744.mp3). 30. Id.
6. See, e.g., Robert G. Bone, Hunting Goodwill: A History of the Con- 31. Id.; see also Abercrombie & Fitch Co. v. Hunting World,
cept of Goodwill in Trademark Law, 86 B.U. L. Rev. 547, 550 (2006). Inc., 537 F.2d 4, 9 (2d Cir. 1976) (classifying marks as (1) generic,
7. Laurence Minsky & Colleen Fahey, What Does Your Brand (2) descriptive, (3) suggestive, or (4) arbitrary or fanciful).
Sound Like?, Harv. Bus. Rev. (Feb. 7, 2014). 32. Gen. Elec. Broad., 199 U.S.P.Q. at 563; see also Nextel
8. Id. Commc’ns, Inc. v. Motorola, Inc., 91 U.S.P.Q.2d 1393, 1408 (T.T.A.B.
9. See Qualitex Co. v. Jacobson Prods. Co., 514 U.S. 159, 162 2009) (sustaining opposition on the basis that the sound mark had not
(1995). acquired distinctiveness, in part, because the applicant failed to provide
10. U.S. Patent & Trademark Office, Trademark Manual supporting evidence that the mark was used in ads in such a manner that
of Examining Procedure (TMEP) § 1202.15 (Apr. 2017). it would be recognized as a source identiier for mobile telephones).
11. Issues & Policy Comm., Int’l Trademark Ass’n, Resolution: 33. Am. Diabetes Ass’n, Inc. v. Nat’l Diabetes Ass’n, 533 F.
Protectability of Sound Trademarks (Feb. 25, 1997), http://www. Supp. 16, 19 (E.D. Pa. 1981).
inta.org/Advocacy/Pages/ProtectabilityofSoundTrademarks.aspx. 34. Ford Motor Co. v. Summit Motor Prods., Inc., 930 F.2d 277,
12. Qualitex, 514 U.S. at 164. 292 (3d Cir. 1991) (quoting Am. Sci. Chem., Inc. v. Am. Hosp. Sup-
13. TMEP, supra note 10, § 1202.15. ply Corp., 690 F.2d 791, 792 (9th Cir.1982)).
14. Id. (emphasizing that sound marks function as source indi- 35. 1-2 Jerome Gilson & Anne Gilson LaLonde, Gilson on
cators when they “assume a deinitive shape or arrangement” and Trademarks § 2.11 (3d ed. 2013) (citing Qualitex Co. v. Jacobson
“create in the hearer’s mind an association of the sound” with a good Prods. Co., 514 U.S. 159, 165 (1995)).
or service (quoting In re Gen. Elec. Broad. Co., 199 U.S.P.Q. 560, 36. Qualitex, 514 U.S. at 165 (quoting Inwood Labs., Inc. v. Ives
563 (T.T.A.B. 1978))). Labs., Inc., 456 U.S. 844, 850 n.10 (1982)).
15. Id. § 807.09. 37. TMEP, supra note 10, § 1202.02(a)(viii).
16. Registration No. 916,522 (listen to the sound mark at https:// 38. TrafFix Devices, Inc. v. Mktg. Displays, Inc., 532 U.S. 23, 34
www.uspto.gov/sites/default/iles/72349496.mp3). (2001).
17. Registration No. 1,395,550 (listen to the sound mark at 39. In re Vertex Grp. LLC, 89 U.S.P.Q.2d 1694, 1704 (T.T.A.B.
https://www.uspto.gov/sites/default/iles/73553567.mp3). 2009) (citing In re Morton-Norwich Prods., Inc., 671 F.2d 1332
18. See 37 C.F.R. § 2.61(b); TMEP, supra note 10, § 807.09 (C.C.P.A. 1982)); see also Valu Eng’g, Inc. v. Rexnord Corp., 278
(advising that the applicant should submit an audio reproduction of F.3d 1268 (Fed. Cir. 2002).
any sound mark). The function of this reproduction is to clarify the 40. 89 U.S.P.Q.2d at 1695–96.
mark’s description. Further, the reproduction must be an electronic 41. Id. at 1700.
ile in .wav, .wmv, .wma, .mp3, .mpg, or .avi format and should not 42. Id. at 1702.
exceed 5 MB in size due to the inability of the Trademark Electronic 43. Id.
Application System (TEAS) to accommodate larger iles. 44. Id. at 1704.
19. Registration No 1,872,866 (listen to the sound mark at 45. 91 U.S.P.Q.2d 1393, 1395 (T.T.A.B. 2009).
https://www.uspto.gov/sites/default/iles/74309951.mp3). 46. Id. at 1401–02.
20. Registration No. 2,000,732 (listen to the sound mark at 47. Id.
https://www.uspto.gov/sites/default/iles/74629287.mp3). 48. 105 U.S.P.Q.2d 1789 (T.T.A.B. 2013).
21. Registration No. 3,411,881 (listen to the sound mark at 49. Jordan Passman, Intel, Netlix, Apple and the Power and Inlu-
https://www.uspto.gov/sites/default/iles/76280750.mp3). ence of Sonic Branding, Forbes (Nov. 2, 2016), https://www.forbes.
22. Registration No. 2,450,525 (listen to the sound mark at com/sites/jordanpassman/2016/11/02/intel-netlix-apple-and-the-
https://www.uspto.gov/sites/default/iles/75676156.mp3). power-and-inluence-of-sonic-branding/#7d017ad34836 (“The Intel
23. Registration No. 3,792,268 (listen to the May 15, 2009, Mark at bong is one of the most powerful assets we have. We’re always look-
http://tsdr.uspto.gov/#caseNumber=3792268&caseSearchType=US_APP ing for ways to showcase the amazing experiences that Intel enables,
LICATION&caseType=DEFAULT&searchType=documentSearch). and the Intel bong sound helps keep our messaging consistent.”).
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