Trademark and Copyright Litigation

Federal Appellate Court Explores Narrow Exception to Rule 54(b)’s Finality Rule in Trade Secrets Misappropriation Case

January 1, 2023 | Peter S. Lubin and Patrick Austermuehle

In a complicated trade secret misappropriation case involving an evolving cast of characters, United States First Circuit Court of Appeals affirmed the dismissal of trade secret misappropriation claims between former drug development partners. However, the First Circuit found that the district court abused its discretion by denying the plaintiff’s motion to file an amended complaint and consequently vacated the dismissal of trade secret claims against one of the defendant’s U.S. affiliate. In doing so, the Court was forced to explore the often misunderstood “narrow exception” to Rule 54(b)’s finality rule.

The plaintiff, Amyndas, is a Greek biotechnology firm that researches and develops therapeutics targeting a part of the immune system known as the complement system. In 2015, Amyndas entered into a confidential disclosure agreement (CDA) with a Danish biotech firm, Zealand, to develop treatments targeting this complement system. The following year, the parties entered into a second CDA. products as those pursued during its collaboration with Zealand. As part of its collaboration with Amyndas, Alexion requested and received certain confidential information about Amyndas’s complementary therapeutic research, including details about Amyndas’s intellectual property, planned clinical trials, platform and collaboration network.

Supreme Court Rules that Inadvertent Mistake of Law Does not Invalidate Copyright Registration

April 8, 2022 | Peter S. Lubin and Patrick Austermuehle

In a recent decision, the Supreme Court held that a copyright applicant’s inadvertent mistake of law in a copyright registration application does not invalidate the application or corresponding registration. In so holding, the Court erased an earlier victory for fashion retailer H&M in a long running copyright dispute with fabric designer Unicolors, Inc. handed down by an appeals court. Before the Supreme Court’s decision, the Ninth Circuit court of appeals had ruled in favor of H&M nixing a $750,000 win for Unicolors.

To obtain special rights for copyright holders afforded by the Copyright Act of 1976, the creator must apply for a copyright registration by, among other things, submitting a copy of the work and an application for the copyright to the federal Copyright Office’s Register of Copyrights. Under the Copyright Act, the application for registration of a copyright should not contain inaccurate information. However, in the event that an application does contain inaccurate information, the resulting registration is not automatically invalidated. The Copyright Act contains a safe harbor provision that provides that the registration will only be invalidated if the applicant knew that the information in the application was inaccurate and the inaccuracy is such that, if matters were accurately presented, the Register of Copyrights would have denied the application. Continue reading ›

Copyright Office to Study Whether New Copyright Protections for Press Content Publishers are Needed

November 4, 2021 | Peter S. Lubin and Patrick Austermuehle

At the request of Congress, the Copyright Office recently agreed to undertake a public study to evaluate the effectiveness of current copyright protections for publishers in the United States, with a particular focus on press publishers. The Copyright Office issued a Notice of Inquiry seeking public comment on a variety of issues that could extend new protections to press publishers and other content creators beyond those afforded under existing copyright law.

In its letter requesting the study, Congress cited a recent directive by the European Union establishing “ancillary copyright” protections for press publishers. The Copyright Office has stated that its study will consider whether or not similar protections are warranted within the United States, as well as the potential scope, source, and appropriate beneficiaries of any such additional protections. Responsive comments from the public are due November 26, 2021. The Copyright Office will also hold a virtual public roundtable to discuss these and other related topics on December 9, 2021. A participation request form will be posted on the Copyright Office website by October 25, 2021.

The study could impact both traditional media outlets producing content and on digital media sharing of that content. It was specifically the impact of digital media on traditional content publishers that served as the impetus for the new study. The Copyright Office’s notice began with the observation that the internet has ushered in an era of disruption and transformation for the press-publishing ecosystem. It recites the financial impact that the internet has had on newspapers and other publishers. Specifically, the notice notes that newspaper advertising revenues enjoyed a steady increase for more than three decades during the years from 1970 to 2006, but have since suffered a precipitous 62% decline during the years from 2008 to 2018. From 2008 to 2019, the number of newspaper newsroom employees dropped by more than 40% and one in five (20%) newspapers closed. Continue reading ›

Selling Top Fashion at Low Prices Comes with Its Own Price to Pay … in the Courts

August 15, 2021 | Peter S. Lubin and Patrick Austermuehle

You may or may not have heard of Shein, the fast-fashion company out of China providing its customers with the highest fashions for the lowest prices, but if you haven’t heard of it yet, chances are good you’ll be hearing about it very soon. While Shein might not exactly be a household name (yet), it’s very quickly working its way up the ladder, having just replaced Amazon as the most downloaded shopping app.

The fast-growing fashion company has no intention of slowing its growth any time soon, and going up against Amazon is one of its key strategies. While many manufacturers consider partnering with Amazon essential to getting their products in front of customers, Shein sees greater value in having a more direct relationship with their consumers, and as a result, having direct access to their customers’ data. Access to (and proper use of) that data, combined with their ability to produce cheap versions of clothes and accessories from designer brands in a matter of days, has been critical to the fashion start-up’s success.

Shein’s ability to cheaply reproduce top fashions is not new, but the speed with which it is able to do so certainly is. While other companies providing high fashion at affordable prices, such as Forever 21, have long been accused of stealing designs and infringing on the patents and copyrights of other designers, Shein is the first company with the ability to reproduce patterns and designs from the runway (and even the social media accounts of certain designers and influencers) in a matter of days. They credit their data analysis with their ability to reproduce top fashions for a fraction of the price in a matter of days. Continue reading ›

Multiple Courts Consider whether Juries Should Decide Disgorgement of Profits in Copyright Infringement Cases but Reach Different Conclusions

July 20, 2021 | Peter S. Lubin and Patrick Austermuehle

A recent decision in the case of Huffman v. Activision, a case we previously covered here, has created a split among federal courts on the issue of who gets to decide the issue of disgorgement of profits in copyright infringement cases. The court in Huffman ruled that a jury is entitled to decide the issue. Other courts to recently consider the issue have come to the opposite conclusion finding that the court should decide the issue, not a jury. These differing answers to the same question may be teeing up the issue for the Supreme Court to settle the question once and for all.

As we have previously detailed, Huffman involves claims by retired professional Booker T that video game developer, Activision, infringed on his copyrights. Specifically, Huffman has alleged that Activision’s video game character, David “Prophet” Wilkes, in Call of Duty: Black Ops 4 infringed his own “G.I. Bro” character. Huffman requested that the issue of disgorgement of Activision’s profits be decided by a jury. Activision moved to strike Huffman’s jury demand.

In its motion, Activision argued that Section 504(b), the section of the Copyright Act dealing with disgorgement of an infringer’s profits, does not provide a statutory or constitutional right to a jury trial. Activision’s motion was filed on the heels of a decision on essentially the same issue in the case Navarro v. Procter & Gamble in which the court in that case found no right to a jury on the issue of disgorgement of an infringer’s profits under Section 504(b). Despite concerning the same issue, the district court disagreed with the reasoning and conclusion of the Navarro court and denied Activision’s motion.

The plaintiff in Navarro is Anette Navarro, a world-renowned photographer, from Cincinnati, Ohio. She filed a copyright infringement suit against Procter & Gamble (P&G) and Walmart alleging that the companies willfully infringed on her copyrights in certain photos that she provided to P&G for use pursuant to licensing arrangements between the parties. Navarro claims that P&G violated the terms of the license by using them on products and in geographic areas beyond those permitted in the license agreements and also continued to use her photographs after the licenses expired.

She sought both actual damages and disgorgement of the defendants’ profits under Section 504(b) of the Copyright Act. P&G and Walmart sought to strike her jury demand with regard to disgorgement of profits, arguing that nowhere does Section 504(b) mention juries. They also argued that there was no constitutional right to a jury under the Seventh Amendment because it only provides a right to a jury for “legal” remedies, not “equitable” remedies which the companies argued disgorgement was. Continue reading ›

Supreme Court Sides With Google in Copyright Infringement Case Filed by Oracle

May 29, 2021 | Peter S. Lubin and Patrick Austermuehle

On April 5, 2021, the United States Supreme Court issued its much-anticipated decision in the long-running case of Google v. Oracle, a case that we have been following for nearly five years. In its long awaited decision, the Court held that Google’s copying of the “declaring code” from the application program interface (API) of Oracle’s Java SE platform when creating Google’s Android operating system constituted fair use under copyright law. By deciding the case on these grounds, the Court managed to sidestep the issue of whether the software code at issue was copyrightable in the first place. Instead, the Court simply assumed that it was, virtually guaranteeing that it will be forced to address the issue in a future case.

Background

The saga that culminated in the Court’s decision dates all the way back to 2005 when Google acquired Android and began creating its now-famous Android software platform for mobile devices. Google’s goal was to create an open platform that would allow software developers to build mobile applications to run on it. The Java programming language, originally invented by Sun Microsystems which was later acquired by Oracle, was an obvious candidate for use in the Android platform as it was a popular programming language among software developers.

Shortly after Google’s acquisition of Android, Google began talks with Sun to explore the potential for licensing the entire Java platform. However, negotiations broke down after it became apparent that Sun’s requirement of interoperability was not compatible with Google’s vision for the Android platform. This left Google to build the Android platform on its own.

Creating the Android platform required roughly 100 Google engineers working for more than three years and required writing millions of lines of new code. Google did not write the entire platform from scratch, however. Instead, it copied roughly 11,500 lines of code from the Java SE program, consisting of 37 Java API packages. APIs are used by software programmers to simplify the creation of complex computer programs by allowing two programs to communicate with each other. Java’s API provides access to a collection of prewritten software programs that carry out a large number of specific tasks.

When Oracle Corporation acquired Sun in 2010, Google’s Android platform had been completed for several years and was already a notable success. Oracle promptly filed suit against Google alleging infringements of Oracle’s patents and copyrights. The first trial ended in a victory for Google when the district court ruled that the API packages were not copyrightable as a matter of law. That decision was overturned on appeal and remanded further proceedings on Google’s copyright infringement defense of fair use. Following a second trial, a jury found that Google’s copying constituted fair use, but this verdict was overturned on appeal when the Federal Circuit found that Google’s use of the declaring code was not a fair use as a matter of law. The Supreme Court then agreed to consider both the copyrightability and fair use questions. Continue reading ›

Everyone Wants in on the March Madness Action

April 4, 2021 | Peter S. Lubin and Patrick Austermuehle

“March Madness” is a popular term used to refer to the basketball tournament run by the National College Athletic Association (N.C.A.A.) every year in March, but it’s not an accident that everyone thinks of college basketball when they think of March Madness. It’s the result of the N.C.A.A. having trademarked the name, along with strategic branding, and they are very proactive about protecting that brand, even if it means suing a urology practice over the phrase “Vasectomy Mayhem”.

The urology practice, Virginia Urology, registered the term “Vasectomy Mayhem” with the U.S. Patent and Trademark Office and proceeded to launch an ad campaign linking their practice to the March Madness basketball tournaments. Their ads featured a doctor, in scrubs and with a basketball, claiming if men wanted an excuse to stay home and watch basketball all weekend, they could do so while recovering from their vasectomy.

The N.C.A.A. sued the urology practice, claiming the term “Vasectomy Mayhem” was too similar to “March Madness”, and as a result, might cause confusion and dilute the value of their brand. According to the complaint, the N.C.A.A. believes its brand has already suffered damage from the registration of the term, and will continue to suffer damage if the urology practice is allowed to maintain the registration and continue using the term “Vasectomy Mayhem” in their advertising. Continue reading ›

G.I. Bro Copyright Lawsuit against Call of Duty Developer Survives Summary Judgment

March 26, 2021 | Peter S. Lubin and Patrick Austermuehle

Recently a federal judge in the Eastern District of Texas ruled that copyright infringement claims filed by retired professional wrestler Booker T. Huffman (known as Booker T) against Activision, the developer of the Call of Duty video games, should proceed to trial. The infringement claims revolve around alleged similarities between promotional artwork for the Call of Duty 4 video game and a poster depicting Huffman’s in-ring persona G.I. Bro.

In 2015, Huffman commissioned a poster from the artist, Erwin Arroza, to promote his comic, G.I. Bro and the Dragon of Death. The comic stars a “special operations hero called G.I. Bro,” which bears a striking resemblance to Huffman in his G.I. Bro persona. Following creation of the poster, Huffman distributed copies of the poster at comic conventions and other events.

In 2018, Activision commissioned Petrol Advertising, Inc. to create a series of marketing images of the characters in its Black Ops 4 video game. Black Ops 4, which was released in 2018, was a prequel to the third Black Ops game, and featured many of the same characters as the prior version including the character David “Prophet” Wilkes. The ad agency hired live models and conducted several photoshoots with them in order to create the allegedly infringing marketing images. The ad agency then created a “composite” by adding graphical elements to create the artwork. Activision used this resulting artwork in various promotional posters, billboards, and special edition packaging, some of which included the allegedly infringing “Prophet Image” that is the focus of the lawsuit. Continue reading ›

Illinois Court Upholds Sanctions for Pursuing Trade Secrets Claims in Bad Faith

February 12, 2021 | Peter S. Lubin and Patrick Austermuehle

Statutory fee-shifting is usually meant to incentivize plaintiffs to bring claims involving important rights but relatively low monetary damages. Some statutes provide for fee-shifting not only to successful plaintiffs but also to successful defendants. As the recent decision in the case of Multimedia Sales & Marketing, Inc. v. Marzullo illustrates, plaintiffs considering bringing trade secret misappropriation claims in Illinois courts would be wise to review their claims before filing so to ensure that their claims are not meritless.

The plaintiff in the lawsuit, Multimedia Sales & Marketing, Inc., is a radio advertiser who sued a competitor, Radio Advertising, Inc., along with three former employees who left Multimedia to work for Radio Advertising. Multimedia alleged that the former employees misappropriated Multimedia’s potential customer lead lists or renewal lead lists, which these individuals allegedly used to attempt to woo away Multimedia’s existing and potential customers. Multimedia claimed the lists were protectable trade secrets under the Illinois Trade Secrets Act (ITSA), 765 ILCS 1065/1 et seq.

The trial court disagreed and granted the defendants summary judgment finding that the lists (1) did not qualify as a trade secret under ITSA, and (2) were not “secret” because Multimedia widely shared them with numerous parties including radio stations. Following the grant of summary judgment, the defendants filed a motion for attorney’s fees as permitted by Section 5 of the ITSA. The trial court granted the defendants’ motion and awarded them $71,688 in attorney’s fees. Multimedia then appealed the ruling that the lists did not qualify as trade secrets as well as the award of attorney’s fees. Continue reading ›

When Sherlock Holmes is Not in the Public Domain

January 19, 2021 | Peter S. Lubin and Patrick Austermuehle

Everyone knows who Sherlock Holmes is. Even if you haven’t read one of Sir Arthur Conan Doyle’s short stories featuring the famous detective, you’ve no doubt seen, or at least heard of, one of the many adaptations of Holmes and his adventures into other works of fiction, from other books and short stories, to movies and TV shows. He is known as the cold, calculating detective who sees clues everywhere, but is either incapable of taking into consideration the feelings of the people around him, or just lacks the patience to do so.

That is the Sherlock Holmes of the public domain, but later stories written by Doyle show a softer side – someone who has become more considerate in general, and more respectful towards women in particular. That version of the detective is not yet in the public domain, which forms the basis of a copyright lawsuit against Netflix, Nancy Springer, and Random House, among others.

The copyright lawsuit focused on Enola Holmes, a series of young adult books written by Springer, published by Random House, and adapted into a film starring Millie Bobby Brown that was released on Netflix in 2020. Enola is Sherlock’s younger sister and proves equally capable of solving mysteries. Both the books and the film portray a Sherlock (played by Henry Cavill in the film) who starts out dismissive of his younger sister, but gradually grows warmer towards her as she grows on him, and it is those latter characteristics that prompted the estate of Sir Arthur Conan Doyle to file their copyright lawsuit. Continue reading ›