When Winning Might Also Be Losing: The Preclusive Effects of Defending a Trademark Application or Registration
December 29, 2006
Last summer, the Third Circuit Court of Appeals in <i>Jean Alexander Cosmetics, Inc. v. L'Oreal USA, Inc.</i>, 458 F.3d 244 (3rd Cir. 2006), joined a majority of the courts of appeal in holding that it would give full preclusive effect to any of the alternative holdings of a prior adjudication. In so doing, the court further highlighted the necessity of thinking both offensively and defensively at the earliest stages of a trademark dispute, including during proceedings before the Trademark Trial and Appeals Board ('TTAB').
Protecting Trade Dress in Once-Patented Subject Matter
December 29, 2006
The recent decision, <i>Fuji Kogyo Co. v. Pacific Bay Int'l, Inc.</i>, 461 F.3d 675 (6th Cir. 2006), confronts the question deliberately left unresolved in <i>TrafFix Devices, Inc. v. Marketing Displays, Inc.</i>, 532 U.S. 23 (2001), of whether a product design claimed in a prior utility patent can ever be protectable trade dress under the Lanham Act. Although setting a high bar to protectability, indeed a 'presumption' and 'heavy burden' that material claimed in a utility patent is functional and hence unprotectable once the patent term ends, the Supreme Court, of course, expressly elected not to foreclose such protection entirely. Thus, it refused the invitation of defendant TrafFix, and 'some of its amici,' to rule that 'the Patent Clause of the Constitution, Art. I '8, cl. 8, of its own force, prohibits the holder of an expired utility patent from claiming trade dress protection.' 532 U.S. at 35. Without itself addressing the constitutional question of how narrowly 'limited times' means 'limited times,' <i>Fuji Kogyo</i> does nothing to ease the burden in establishing trade dress protection for once-patented subject matter; it offers as well a new (if, perhaps, less than fully developed) analytical approach for applying the <i>TrafFix</i> presumption, asking whether the claimed trade dress would have infringed the expired patents.
The Use of Market and Industry Data in Patent Damages: The Two Approaches under Federal Rule of Evidence 703
December 29, 2006
Whether calculating lost profits or performing a 'reasonable royalty' analysis under the <i>Georgia-Pacific</i> factors, a damages expert in a patent case is required to consider a large variety of data ' not just data from the plaintiff or the defendant, but also data from third-party sources, such as trade industry publications or market analyst reports. The admissibility of an opinion based on third-party information, however, has been a source of conflict since 1993, when the U.S. Supreme Court decided <i>Daubert v. Merrell Dow Pharms., Inc.</i>
More from the Best of MLF 2006
December 28, 2006
In last month's issue, we covered the best of MLF from February to and including June 2006. In this issue, we will take a look back at July through November.
Beware the Gatekeeper
December 22, 2006
Last month, we explained that valuation issues come into play throughout Chapter 11 business reorganization cases. We discussed how to recognize the uncertainties underlying expert valuation conclusions; enterprise/going concern value; and the fact that the goal of any valuation is to make an estimate based on an informed judgment that embraces all facts relevant to future earning capacity and hence to present worth, including, of course, the nature and conditions of the properties, the past earnings record, and all circumstances that indicate whether or not the record is reliable criterion of future performance. We conclude this month with a discussion of expert evidence.
IP News
November 30, 2006
Highlights of the latest intellectual property news from around the country.
Skating the Thin Ice of the Written Description Requirement
November 30, 2006
In recent years, cases such as <i>Enzo Biochem, Inc. v. Gen-Probe, Inc.</i>, 323 F.3d 956 (Fed. Cir. 2002) ('<i>Enzo</i>') and <i>University of Rochester v. G.D. Searle and Co., Inc.</i>, 375 F.3d 1303 (Fed. Cir. 2004) ('<i>Rochester</i>') have fueled an ongoing debate over whether the first paragraph of 35 U.S.C. §112 includes a written description requirement, separate and distinct from enablement and best mode. According to Judge Randall Ray Rader, <i>Univ. of Cal. v. Eli Lilly & Co.</i>, 119 F.3d 1559 (Fed. Cir. 1997) ('<i>Eli Lilly</i>') brought the written description requirement squarely to light. <i>Rochester</i>, 375 F.3d at 1307 (Circuit Judge Rader dissenting). This 'new' requirement creates 'enormous confusion,' not only for the courts, but also for patent drafters. <i>Id.</i> Because the requirement is in flux, patent practitioners should avoid overlooking the requirement or taking it too lightly.
Nontraditional Trademarks: The Flavor of the Month
November 30, 2006
Recently, in a case of first impression, the Trademark Trial and Appeal Board refused to grant trademark protection to the flavor of an antidepressant tablet on the grounds that the flavor was functional and incapable of serving as a mark. <i>In re N.V. Organon</i>, 79 USPQ2d 1639 (TTAB 2006). The decision is a departure from the trend of extending protection to nontraditional trademarks. Although the Board left the door open to the possibility of registering flavor as a trademark, it made clear that future applicants will face significant challenges in registering such marks, including: 1) proving that a flavor has acquired secondary meaning; 2) overcoming the difficulties inherent in protecting a flavor due to the subjective nature of taste; and 3) proving that a flavor functions as a source indicator despite the fact that consumers are not exposed to a product's flavor prior to purchase.
Is Software a Section 271(f) 'Component' of a Patented Invention?
November 30, 2006
On Oct. 27, 2006, the Supreme Court granted certiorari in <i>Microsoft Corp. v. AT&T Corp.</i> (No. 05-1056), preparing to elucidate the contours of patent infringement under 35 U.S.C. §271(f) as applied to the exportation of software code. This case marks the first time in the 22 years since Congress enacted the provision that the Court will venture into this area. The outcome may have significant ramifications for the software industry because §271(f) was widely assumed to apply only to the tangible components of a physical machine. If §271(f) applies equally to software, then software companies will need to rethink their exposure to liability when exporting software abroad. Liability under §271(f) may extend beyond the initial act of exporting and further include downstream activities, such as copying and installing that are done entirely outside of the United States.
