Trademark and Copyright Litigation

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 ›

Video Game Maker Has Mixed Success in Copyright Infringement Lawsuits over Depictions of Copyrighted Tattoos

December 19, 2020 | Peter S. Lubin and Patrick Austermuehle

Copyright infringement lawsuits over tattoos have become increasingly popular since Mike Tyson’s tattoo artist famously sued Warner Brothers over its recreation of Tyson’s face tattoo on the face of actor Ed Helms in the Hangover II. The latest bout of suits involving copyrighted tattoos involves video game maker Take-Two Interactive Software.

Take-Two is responsible for a number of popular game franchises including Grand Theft Auto, NBA 2K, and WWE 2K. In addition to releasing some of the most popular video games titles of the year, Take-Two has found itself defending against two separate copyright infringement suits over the company’s use of tattoos in its NBA 2K and WWE 2K games.

A federal judge in New York earlier this year dismissed the lawsuit over Take-Two’s depiction of athletes’ tattoos in its NBA 2K video games. In dismissing the lawsuit, the judge found that Take-Two’s use of the tattoos did not infringe the plaintiff’s copyrights because Take-Two had an implied license to display the tattoos and also because Take-Two’s use constituted fair use and was de minimis in the context of the entire games.

The second lawsuit filed in an Illinois federal court concerned Take-Two’s depiction of tattoos in its WWE 2k games. After the case proceeded to discovery, the parties filed cross-motions for summary judgment. The plaintiff’s motion sought partial summary judgment on the issue of actionable copying based on Take-Two’s admission “to copying Alexander’s tattoos in their entirety in order to depict Orton in WWE 2K as he appears in real life.” Take-Two’s motion asserted the same affirmative defenses of implied license, fair use, and de minimis copying. Despite the similarity of the cases and Take-Two’s defenses, the federal judge overseeing the Illinois case did not warm to Take-Two’s arguments. Continue reading ›

Bill Murray Faces Copyright Lawsuit from Doobie Brothers

November 12, 2020 | Peter S. Lubin and Patrick Austermuehle

Every time you hear a famous song playing in a commercial, it’s because the producers paid for the right to use that song in their commercial … or at least they were supposed to. According to a recent copyright lawsuit the Doobie Brothers filed against Bill Murray, the famous actor allegedly failed to obtain permission from the band before using one of their hits in a commercial for his clothing line.

Murray, along with his brothers, released a line of golf clothing under the name William Murray. One of his recent commercials promoting the clothing line featured the song, “Listen to the Music”, a hit created by the Doobie Brothers that reached #11 on the Billboard chart in 1972.

The commercial featuring the song was specifically promoting a polo shirt called Zero Hucks Given, which is named after the fictional character, Huckleberry Finn. The clothing line is meant to bring back the loud golfing clothes that were popular in the 1970s, which could be why Murray chose to use a song from the early ‘70s to evoke that time period in his advertisements.

Peter T. Paterno, the attorney representing the Doobie Brothers, sent a letter to Murray notifying him of the lawsuit. Paterno also represents other musicians whose music Murray has allegedly stolen for use in commercials promoting his line of golf wear, although the Doobie Brothers are the only plaintiffs named in this copyright lawsuit. Continue reading ›

Musicians Make Novel Argument to Keep Trump from Using Their Songs

September 22, 2020 | Peter S. Lubin and Patrick Austermuehle

Musicians have been trying for years to control whether and which politicians may play their music at events. Many see their efforts as a natural reaction to a legitimate concern with having their art associated with someone whose views may not align with their own. As seen in a recently filed lawsuit by Neil Young against President Trump’s reelection campaign, musicians are trying out new strategies.

There is no love lost between Young and President Trump. The President has been using Young’s songs at rallies and events ever since he announced his campaign in 2015. This never sat well with Young who expressed his displeasure numerous times online and in interviews. Young’s posts were laced with frustration as he conceded that “legally he has the right to” but added, “however it goes against my wishes.” On election day in 2018, Neil Young posted a frustrated statement about President Trump and his continued use of Young’s music at events.

Young’s gripe with Trump’s use of his music is no recent phenomenon. Musicians and songwriters have balked when politicians play their songs at public events for decades. A famous example is Bruce Springsteen’s objection to Ronald Reagan’s campaign’s use of “Born in the U.S.A.” at campaign events in 1984. Numerous other artists have objected to political co-opting of their music over the intervening years.

Young’s recently filed lawsuit takes issue with President Trump’s use of “Rockin’ in the Free World” and another song, “Devil’s Sidewalk,” at the President’s rally in Tulsa, Oklahoma in June. In his suit, the musician accused the President’s campaign of copyright infringement for playing the songs without a license. The lawsuit seeks to enjoin the campaign from using the songs as well as an award of statutory damages. In his complaint, Young contends that he “in good conscience cannot allow his music to be used as a ‘theme song’ for a divisive, un-American campaign of ignorance and hate.” Continue reading ›

Professional Esports Player Player Sues Company, Company Sues Player, Neither Gets Far

August 16, 2020 | Peter S. Lubin and Patrick Austermuehle

When one party sues another over a business dispute, not only does the defendant deny the allegations, but it’s also common for the defendant to countersue, meaning they bring their own allegations against the individual or entity suing them. After Turner “Tfue” Tenney, a professional esports player, sued FaZe Clan, a professional esports organization, FaZe Clan turned around and sued Tenny for allegedly breaching his contract with them and denying them a portion of the income he earned from streaming.

The legal dispute started in May of 2019 when Tenney sued FaZe for allegedly operating as an unlicensed agency, blocking Tenney from various business opportunities, and taking up to 80% of the income Tenney earned.

Tenney claimed that, by allegedly operating as an unlicensed agency, FaZe had violated the California Talent Agency Act (TTA), which prohibits unlicensed agents from managing talent in the state of California. Tenney used this as his basis for asking the court to rule that his contract with FaZe was invalid because it went against California law, but FaZe argued that it hadn’t managed Tenney in the state of California, and so their contract was not subject to California law.

Tenney also alleged FaZe had breached the Gamer Agreement between Tenney and the company by failing to pay an agreed-upon fee of $2,000 per month. FaZe did pay the fee eventually, but Tenney alleged the payments were so late as to render the contract invalid. Continue reading ›

District Court Ordered to Reevaluated Whether Defendants Were Entitled to Fees in Trademark Dispute

January 29, 2020 | Peter S. Lubin and Patrick Austermuehle

The owner of an upscale downtown Chicago hotel sued a competing hotel elsewhere in the city for trademark infringement. After more than a year, the plaintiff company eventually voluntarily dismissed its suit. The defendants then moved for attorney fees. The district court initially denied the motion, finding that the plaintiffs had not brought the type of exceptional case that warranted fee-shifting after dismissing the claims. The defendants appealed, and the appellate panel determined that the district court applied the wrong standard in evaluating the motion for fee-shifting. The panel reversed the decision of the district court and remanded the case with instructions for the court to reanalyze the request for fees under the correct standard.

LHO Chicago River, LLC, owns an upscale downtown Chicago hotel that underwent a branding change in February 2014 when it became “Hotel Chicago,” a signature Marriott venue. Around May 2016, Joseph Perillo and his three associated entities opened their own “Hotel Chicago” only three miles from LHO’s site. LHO then sued the defendants for trademark infringement and unfair competition under the Lanham Act, as well as for trademark infringement and deceptive practices under Illinois state law. Continue reading ›

Amazon’s Audible Sued for Copyright Infringement over Caption Feature

October 10, 2019 | Peter S. Lubin and Patrick Austermuehle

Some of the top publishing companies recently filed a copyright infringement suit against Audible, an Amazon subsidiary, seeking to enjoin to the audiobook company’s rollout of a new feature called “Audible Captions” which shows the text on-screen as a book is narrated. The plaintiffs in the lawsuit are seven members of the Association of American Publishers (AAP), including the “Big Five” of publishing: Penguin Random House, Hachette Book Group, Simon & Schuster, HarperCollins Publishers, and Macmillan Publishers.

Audible announced the new caption feature back in July and set an official rollout date close to the time when students would be returning to classes in the fall. In advance of filing the lawsuit, many of the plaintiffs sent Audible cease-and-desist letters or released public statements calling the feature “an unauthorized and brazen infringements of the rights of authors and publishers.”

In the simplest terms, Audible Captions displays the text of an audiobook to listeners in real-time while the book is being read to them. Audible generates the text in real-time using Audible’s transcription technology. According to the complaint, “Audible Captions takes Publishers’ proprietary audiobooks, converts the narration into unauthorized text, and distributes the entire text of these ‘new’ digital books to Audible’s customers.” This conversion of audio to text, the plaintiffs allege, constitutes the creation of unauthorized derivative works in violation of the Copyright Act. Continue reading ›

Sports Drink Manufacturer Fairly Used Trademarked Phrase to Describe Its Products

September 19, 2019 | Peter S. Lubin and Patrick Austermuehle

A sports nutrition and wellness consulting firm sued a major manufacturer of sports drinks, arguing that the manufacturer had violated the consulting firm’s trademark when it referred to itself as “The Sports Fuel Company.” The district court granted summary judgment in favor of the manufacturer. The appellate panel affirmed, finding that the manufacturer used the phrase in question as a descriptor and not a source indicator. The panel found that this was an example of fair use.

SportFuel is a Chicago-based sports nutrition and wellness consulting firm whose clients include several of Chicago’s professional sports teams and their athletes. The company provides personalized nutritional consulting services to professional and amateur athletes and also sells SportFuel branded dietary supplements. SportFuel holds two registered trademarks for “SportFuel.” One of SportFuel’s trademarks became incontestable in 2013, and the second was registered for the first time in 2015. Continue reading ›

Trademark License Survives Bankruptcy Supreme Court Rules

August 22, 2019 | Peter S. Lubin and Patrick Austermuehle

In an 8-1 decision, the Supreme Court ruled that a company’s bankruptcy does not allow it to rescind a trademark licensing agreement it had entered with a licensee. In so ruling, the court settled an issue that had split the federal appellate circuits and congress over the handling of trademarks licenses in bankruptcy.

The case stems from a 2012 license agreement between New Hampshire-based Tempnology LLC and New York-based Mission Product Holdings Inc. over the exclusive rights for U.S. distribution of Tempnology’s apparel and accessory products, which were designed to stay cool when worn during exercise. The products, chemical-free towels, socks, and headbands, were sold under the brand names Coolcore and Dr. Cool. The license also included the nonexclusive right for Mission Product Holdings to use Tempnology’s trademarks.

In 2014, the parties’ relationship soured, which led to the filing of arbitration. In arbitration, the arbitrator ruled that Mission Product Holdings was entitled to maintain its distribution and trademark rights through July 2016, even though it did not intend to place any further orders with Tempnology. In 2015, Tempnology filed for Chapter 11 bankruptcy, claiming that Mission Product Holdings had “starved” it of income. In bankruptcy, Tempnology attempted to rescind the license agreement under Section 365 of the Bankruptcy Code.

At the time Tempnology made the request to rescind the license agreement, the law in the various circuits was not settled, which likely prompted the high court to take on the issue in the first place. The First Circuit had long followed the Fourth Circuit’s 1985 ruling in Lubrizol Enterprises v. Richmond Metal Finishers, Inc., which held that a debtor-licensor could abrogate a licensee’s rights by rejecting the license agreement pursuant to Section 365(a) of the Bankruptcy Code. Congress later overruled Lubrizol as it related to patents and copyrights but refused to do so with regard to trademarks, insisting that more study of the issue was required due to the unique ongoing obligations of mark owners in policing their marks. Continue reading ›