Intellectual Property Law Blog

The Ninth Circuit recently stayed an injunction entered against MGA Entertainment, Inc., that would have otherwise required MGA to ensure that none of its popular Bratz dolls, the subject of a copyright dispute with toy giant, Mattel, Inc., are available on store shelves as of January 21, 2010. The injunction's requirement that MGA also turn over its portfolio of Bratz related trademarks to Mattel was stayed as well. Mattel obtained an injunction against MGA after a jury found that a former Mattel employee, Carter Bryant, came up with the Bratz doll idea while under Mattel's employ, that Mattel owned the copyrights in the Bratz doll designs, and that MGA, who hired Carter Bryant after he left Mattel, infringed Mattel's copyrights.

In a much anticipated decision, the Federal Circuit held yesterday that two pharmaceutical companies, Wyeth and Elan Pharma, were entitled to extended patent term adjustments because the U.S. Patent and Trademark Office failed to perform a correct calculation of the adjustment. Wyeth v. Kappos, No. 2009-1120 (Fed. Cir.). The decision has broad implications because the incorrect calculations were performed as a result of a flawed interpretation of the patent term adjustment statute, 35 U.S.C. sec. 154(b), that the USPTO was applying to all patentees.

The Supreme Court recently heard oral argument in In Re Bilski, in which the Court will make a ruling on the limits of patentable subject matter.

On August 31, 2009, the United States Court of Appeals for the Federal Circuit issued a decision holding that, in order for a trademark registration to be canceled on the basis of fraud, the party challenging the registration must prove that the registrant had actual intent deceive the United States Patent and Trademark Office (“PTO”). Recent decisions by the Trademark Trial and Appeal Board (“T.T.A.B.”), including Medinol v. Neuro Vasx, Inc., 67 U.S.P.Q.2d 1205 (T.T.A.B. 2003), had previously applied a broader objective inquiry into whether the applicant “knew or should have known” with respect to allegations of fraudulent representation, resulting in the cancellation of various trademark registrations. Here, the Court explicitly rejected application of such a standard and affirmatively stated that cancellation is only justified where there is proof of subjective fraudulent intent.

The Chinese government’s emphasis on boosting innovation might be proving fruitful. According to the latest statistics from the State Intellectual Property Office (“SIPO”), the government entity responsible for prosecuting patents, there were 426,000 patent applications filed and 252,000 patents granted in China during the first half of 2009. Compared with the first half of 2008, patent filings are up 31.3 percent and patent grants are up 23.1 percent.

On June 19, 2009, in Zino Davidoff SA v. CVS Corp., the Second Circuit enjoined CVS, a national retail chain, from removing unique production codes ("UPC") from Davidoff product packaging for its "Cool Water" fragrances on the grounds of trademark infringement.[1]  Davidoff, a high end luxury brand, imprints a unique UPC on every product for quality control purposes and to protect against diversion and counterfeiting.  The code contains basic information about each product unit, including "where and when it was produced, ingredients used, and distribution path."[2]  The UPC code ordinarily is used to track goods that are sold to and by unlicensed distributors.  The Davidoff UPC also allows Davidoff to spot defects easily and swiftly recall or remove products from the market when such defects are noted.  The UPC is used to protect the reputation of the brand and its trademarks.

On June 17, 2009, Judge Laura Taylor Swain of the Southern District of New York dismissed the copyright claims of jeans maker Do Denim against rival manufacturer Fried Denim Inc., holding that the mere filing of the copyright applications, fees and deposits did not satisfy the jurisdictional requirement that a copyright be registered before a lawsuit is initiated. Do Denim v. Fried Denim, No. 08Civ.10947, 2009 U.S. Dist. LEXIS 51512, at *7 (S.D.N.Y. June 17, 2009). This decision highlights the importance of copyright registration, as a jurisdictional prerequisite for plaintiffs hoping to protect their designs.

Video games and feature films have a lot in common. Both tell stories and have exciting visuals and music. Although one is "interactive," recent Blu-ray HD discs are now turning linear films into more immersive, interactive experiences. Rights and talent deals for both have likewise followed a path towards convergence with terms and consideration often being negotiated and drafted the same way. Nowhere is this trend more obvious than the increasing popularity of product placement in enhancing the economic value of video games by making the game play more realistic while providing increased marketing value and good will by allowing the game developer and product owner, generally at no out-of-pocket cost, to reach new audiences.

On June 10, 2009, the Second Circuit vacated a summary judgment decision that permanently enjoined menswear designer Joseph Abboud from making commercial use of his own name. J.A. Apparel Corp. v. Abboud, No. 08-3181-cv, 2009 U.S.App. LEXIS 12537, at *3 (2d Cir. June 10, 2009). Judge Amalya Kearse authored the decision for the Second Circuit and reversed the district court's decision and remanded the case for proceedings consistent with the Second Circuit's opinion. This case sets forth important guidelines for fashion designers when entering into agreements regarding personal name trademarks and rights of publicity and privacy.

On June 29, 2009, Governor Schwarzenegger signed into law California's Electronic Discovery Act, which is effective immediately. All discovery propounded or responded to must now comply with the new law. These rules are very similar to the recent revisions to the Federal Rules of Civil Procedure, and bring California in line with the federal e-discovery standards.