IP ADR Blog

(image from the U.K. Trademark Application Blog)

What's the difference between an IP arbitrator or mediator and a general commercial arbitrator and mediator?  Some of us -- like Les Weinstein and Michael Young -- have devoted substantial parts of their careers to patent (Les) and trademark (Michael) litigation.

The rest of us -- the Hon. John Leo Wagner (Fed. Magistrate, Ret.), Eric van Ginkel, the soon-to-be-added Jay McCauley and I -- have litigated patent, trademark, copyright and other IP cases in the course of our more general commercial litigation careers.

What unites us is an avidity for the topic and an interest in keeping up with the law.  So in addition to being the quick studies that all general commercial litigators are, we're already all the way (Les, Mike) or half way there when you lay your fabulously instructive briefs on us.   

To help our clients and ourselves, we print tutorials from time to time by law firms who our statistics page tells us are reading our blog.  Today we excerpt and link to Lindquist and Vennum's terrific Trademark tutorial -- The Trademark Dilution Act of 2006 -- A Summary of Changes Affecting Trademark Owners

When is a mark famous?

A mark is famous if the general consuming public of the United States widely recognizes it as a designation of a source of goods or services.

In determining whether a mark is famous enough to merit protection under the Trademark Dilution Revision Act, a court may consider all relevant factors, including:

1. The duration, extent, and geographic reach of advertising and publicity of the mark, including whether the mark is advertised or publicized by the owner or third parties
2. The amount, volume, and geographic extent of sales of goods or services offered under
   the mark 
3. The extent of actual recognition of the mark 
4. Whether the mark was registered

Because no registry of famous marks exists, determining whether a particular mark is famous requires the court to evaluate these factors on a case-by-case basis.

What constitutes tarnishment and blurring?

Dilution by tarnishment is an association arising from the similarity between the famous mark and the diluting mark that harms the reputation of the famous mark—that is, when the diluting mark is used in connection with undesirable or inferior goods or services that could create a negative association with the use of the famous mark.

Dilution by blurring is an association arising from the similarity between the famous mark and the diluting mark or trade name that impairs the distinctiveness of the famous mark. Dilution by blurring reduces the connection in the minds of consumers between the famous mark and the goods and services for which it is used.

In determining whether a mark is likely to cause dilution by blurring of a famous mark, a court may consider all relevant factors, including:

1. The degree of similarity between the mark or trade name and the famous mark 
2. The degree of inherent or acquired distinctiveness of the famous mark 
3. The extent to which the owner of the famous mark is engaging in substantially
   exclusive use of the mark 
4. The degree of recognition of the famous mark 
5. Whether the user of the mark or trade name intended to create an association with the
   famous mark 
6. Any actual association between the mark or trade name and the famous mark

For the remainder of this excellent article, click here.

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Patent infringement settlements sometimes include the drastic remedy of selling your company.  It is the exception, but by no means any longer surprising, when the parties to a patent infringment mediation inform me that the co-defendants have been exploring the option of a buy-out while I was in separate caucus with the plaintiff.

That being the case, it is wise to come to a mediation prepared to explore valuation issues.  In that regard, I direct your attention to an article by Dennis L. Monroe of Krass Monroe entitled All Company Valuations are Not Created Equal.  Below is an excerpt.  For the full article, click here. 

“What is the value of my company?” is a question I am frequently asked. In the franchisor world (whether it be franchisors or franchisees), we usually focus on a multiple of earnings. In recent times the multiple of earnings have been going up; and there has been a feeding frenzy as it relates to the purchase of franchise companies.

What determines the value of a company? We normally look at the valuation in terms of a third-party sale. However, there are other times when we look at valuations for purpose of financing, estate planning, management compensation and other events that may necessitate a valuation.

There are a number of valuation firms in the country. I wanted to go to someone who is known for valuing businesses of all kinds and for various purposes, not just someone who values franchise businesses, because they can be formulaic in their approach. I had the honor of recently speaking with Mike Bochert, a [former?] Managing Director of Cherry Tree Companies, a 25 year old investment banking and investment management firm. Mike is a long-time investment banker and valuation expert of private companies, whether very small or very large.

Dennis Monroe question: How are company valuations not alike?

Mike Bochert response: To understand why all company valuations are not alike, think “P-C-A.” In other words, valuations vary in Purpose, occur under differing company Circumstances and each is directed to a specific Audience. Each of those variables has an effect on the judgments and considerations which are appropriate for any valuation.

Without trying to be exhaustive, the Purpose of the valuation could be:

• Determining value pursuant to a buy-sell agreement
• An estate valuation
• Obtaining growth financing
• Acquiring another multi-unit business
• Considering being acquired
• Strategic decision making
  

The company’s Circumstances might be:

• Profitable company with substantial growth opportunities
• Franchisee with multiple concepts, one performing well and one performing poorly
• An economically strong operation which is considering the acquisition of another operator
• Troubled operation considering an acquisition by another operator

The Audience for the valuation could be:

• Private equity firm
• Mezzanine financing firm
• Internal Revenue Service
• Litigation attorneys
• Management or Board of Directors

To continue reading, click here.

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Take a look at this excellent article -- Pirates Stealing Content from Rival Website -- by Florida Gunster Yoakley lawyers David Bates and Meenu  Sasser.

This one-page article is well-worth reading if you or your clients possess anything of value on the internet that can be "scraped" by pirates.

The good news?

According to Bates, "[a]bout 95% of the cases are resolved by a cease-and-desist letter."

With that kind of track record, Gunster ought to be thinking about value rather than hourly billing.  Maybe they already have.

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(right:  Los Angeles IP and Entertainment attorney Richard Jefferson)

Some comments deserve their own post and this is true of Richard Jefferson's thoughts on our recent post Red Hot Chilis and Showtime Californicate in the Los Angeles Superior Court.   

After reading over the Complaint, I now see legally how the Red Hot Chili Peppers (the "RHCP") were able to get this case in Court without being accused of blatantly filing a frivolous complaint.

The RHCP have coupled a claim for unfair competition and dilution regarding the TV show title (which looks like a weaker claim on its face) with the stronger claim against the TV Show's soundtrack release (the Californication soundtrack). Of course, the media headline is going to pick up on the more publicized RHCP Album Name vs. TV Show element, but this is typical of the media game in Hollywood.

There are a number of issues that make this case an interesting case to follow, such as the claim that the RHCP's album title has acquired a "secondary meaning" that will transcend trademark categories and the fact that Showtime actually applied for a federal trademark for "Californication" in the TV series category.

Like most entertainment cases, it appears to me that this is just another case of "who has the bigger pockets to pay their lawyers". I suspect that there were extensive pre-litigation correspondence between the parties and Showtime never reached a settlement number that was high enough for the RHCP so they sued.

Also, not only is this good exposure for the band but the way that the media has spun the story so far, Showtime is getting some good pub as well by making it seem like this is a far fetched claim.

Thanks for the thoughtful analysis Richard!  Much appreciated.

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(left:  Mr. Alcalá)

DLA Piper recently released its terrific International Arbitration Newsletter for the Summer of 2007. 

Of greatest interest to us is Juan M. Alcalá's article  Narrow Legal Issue, Broad Philosophical Divide:  Hall Street Associates, L.L.C. v. Mattel, Inc.  

"The issue before the Court," he reports, "is relatively straight forward—may parties to an arbitration agreement agree to non-statutory grounds for vacating an arbitration award (including de novo review of legal findings)?"

The First, Third, Fourth, Fifth, and Sixth Circuits all appear to answer the question in the affirmative. See, e.g., Puerto Rico Telephone Co., Inc. v. U.S. Phone Mfg. Corp., 427 F.2d 21 (1st Cir. 2005), cert. denied, 126 S.Ct. 1785 (2006); Roadway Package System, Inc. v. Kayser, 257 F.3d 287 (3rd Cir. 2001), cert. denied, 534 U.S. 1020 (2001); Syncor Int’l Corp. v. McLeland, 120 F.3d 262 (4th Cir. 1997), cert. denied, 522 U.S. 1110 (1998); Gateway Technologies, Inc. v. MCI Telecommunications Corp., 64 F.3d 993 (5th Cir. 1995); Jacada, Ltd. v. Int’l Mktg. Strategies, 401 F.3d 701 (6th Cir.), cert. denied, 126 S.Ct. 735 (2005).

The Ninth and Tenth Circuits disagree. See Kyocera v. Prudential-Bache Trade Services, Inc., 341 F.3d 987 (9th Cir. 2003) and Bowen v. Amoco Pipeline, Inc., 254 F.3d 925 (10th Cir. 2001).

This simple legal issue, however, is premised on a fundamental philosophical divide concerning the purpose of the FAA. Those courts favoring expanded review of arbitration awards argue that the FAA’s ultimate purpose is to enforce the terms of the arbitration agreement. Those courts with a narrow interpretation of the FAA contend that allowing private parties to contract for broader review standards would “jeopardize the very benefits of arbitration, rendering informal arbitration merely a prelude to a more cumbersome and time-consuming judicial review process.” Kyocera, 341 F.3d at 999

For the remainder of this cogent, timely and thorough analysis, click here.

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We continue our on-going series "Our Readers Write" with Blackwell Sanders attorney Mark S. Hostetler.

Slip this CD into your car's player and spend the most valuable thirty minutes of the year with Mark S. Hostetler, Of Counsel in Blackwell Sanders St. Louis Missouri office, as he discusses what every executive needs to know about negotiating the legal issues critical to the success of every  advertising and marketing campaign.

The CD and accompanying text -- part of the Virtual Leadership Seminar -- include an overview of the laws that affect advertising and marketing, the steps to take to insure compliance, and the dangers to avoid to prevent unwanted legal entanglements with regulatory agencies.  

Topics covered include:

1. A detailed look at the most important laws governing advertising and marketing;
2. a step by step guide for implementing a successful strategy;
3. the 5-7 mistakes most often made and how to avoid them;
4. specific negotiation strategies;
5. roles and motivations of each party; 
6. a seasoned attorney's strategy for working with some of the world's largest companies; and,
7. case Studies of specific situations and what you can learn from them.

Mr. Hostetler's background includes broad management experience in corporate, regulatory, legislative, marketing, antitrust, sales and operational matters.  He is the former Vice President of a leading food company with numerous market leading brands and over twenty production facilities. 

He has extensive experience dealing with the Food and Drug Administration and the United States Department of Agriculture.  He has represented clients before the National Advertising Division, the National Advertising Review Board, the Federal Trade Commission and the United States Justice Department, and various state attorneys general. 

Mr. Hostetler is a sought-after speaker at numerous industry conventions and bar association seminars and adjunct professor on advertising and marketing quality control and other process and operational topics.

Thanks for sharing Mark!

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We start a new feature today called "Our Readers Write" in which we feature IP practice and strategy books written by people practicing in firms whose attorneys read our blog (we have our ways!)

Today we feature Patton Boggs partner Talcott J. Franklin's book Protecting the Brand: A Concise Guide to Promoting, Maintaining, and Protecting a Company’s Most Valuable Asset (Barricade Books).

As explained by the Patton Boggs Trademark Website, in Protecting the Brand, Mr. Franklin

explains trademark law in a simple and easy-to-understand manner, while illustrating how advertisers, marketing professionals, executives, and entrepreneurs consistently and unknowingly work to destroy the very brands they seek to promote.

Protecting the Brand has been widely praised, including by former United States Patent and Trademark Office Director Q. Todd Dickinson, who referred to it as a “valuable and highly readable treatise.” Similarly, Judge Sydnor Thompson, formerly of the North Carolina Court of Appeals, lauded the work by stating that it “successfully pierces the veil of what for many lawyers and most laymen has heretofore been a virtually impenetrable mystery.”

“Understanding the intricacies of trademark law and being able to present an educated view of this inherently complex area is an achievement in itself,” says Patton Boggs Managing Partner Stuart Pape. “In Protecting the Brand, Tal Franklin not only accomplishes this difficult task, he puts forth a thorough yet succinct guide that is amazingly easy to read no matter what one’s knowledge of the topic, while offering exceptional instruction on how to ensure that your company is fully protecting and utilizing the potential of its brand.”

To read the reviews of Protecting the Brand, please click here. To order Protecting the Brand, please click here.

I haven't read it yet myself but am putting it on a long reading list to follow my trek through the generously meaty new Negotiator's Fieldbook that I recently mentioned here and which landed with a resounding thud on my front doorstep yesterday afternoon.

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