Evan Everist

Photo by Sarah Robertson The Dorsey Trademark, Copyright + Advertising team is back from the 2025 International Trademark Association Meeting. It was one for the books. We mixed and mingled with old and new colleagues and as well as our friends from around the world. In between all the meetings and social events, we did manage to attend a few of the important panels and of course, our committee meetings. Here are the highlights: AI-Driven Advertising: Copyright Issues in the New Frontier – This was a lively and engaging panel that focused on managing the chaos that the burgeoning use of AI by companies and independent contractors has caused relating to ownership and authorship of AI-created content. The panel several times reiterated the mantra: Be Fair, Be Bold, Be Reasonable. They encouraged companies to ask whether they actually need to own the content that is created. They also discussed contract clauses “from the wild” and pointed out what works and what can be unreasonable. The most important takeaway was to make sure that whoever is using AI to create content is documenting the process carefully, regardless of whether it is a vendor or an employee. This is because the Copyright Office will require an explanation as to the use of AI to determine whether, and how much of, a work is registrable. USPTO Update: Fireside Chat with Acting Under Secretary of Commerce for Intellectual Property and USPTO Acting Director Coke Morgan Stewart – Acting Director Stewart answered questions about the PTO’s direction under the current administration. She indicated that the USPTO has explained to the administration that as a fee generating agency – rather than a taxpayer funded agency – the USPTO should not be subject to current cost-cutting measures. Despite this, Acting Director Stewart believes the agency can continue to reduce pendency and maintain quality without filing open positions. She also indicated the USPTO is looking into the use of AI to help with review of design marks and to detect fraud. Our neighbors to the North, the Canadian Intellectual Property Office (CIPO), also provided updates about the examination process and efficiency, indicating that they hoped to clear their backlog in just a few months. Greenwashing, Greenhushing and Sustainably: INTA’s Brands and Sustainability Committee met at this year’s conference to discuss the hot topics of greenwashing and greenhushing. If you are not familiar, greenwashing is essentially the false marketing of green/environmental or sustainable claims. Most recently, we’ve seen a lot greenwashing in the context of aspirational claims, namely brands striving to be carbon neutral or reduce their emissions by a certain year. Greenhushing, on the other hand, is when brands do good for the environment, but don’t publicize it. Greenhushing can occur for various reasons including, fear of accusations of greenwashing, consumer perception that “green” products are more expensive or inferior, or even for political reasons. While we didn’t make any promises or claims, the committee was proud to support a digital business card initiative and encourage the use of reusable water bottles to help make the conference more sustainable for all. Crafting Successful Agreements with Branding Agencies: A roundtable discussion took place between practitioners from Canada, the UK, and US on how brands can best partner with their creative agencies and areas of best drafting practices for agreements between the two. Discussion of the scope of services and consideration of AI-generated work product dominated the conversation, including how best to allocate risk created by the use of AI particularly where this work product is specifically contemplated or where influencers are involved. Discussion of the extent of preliminary clearance work members of the group were carrying out on behalf of agencies, or that agencies were otherwise expected to conduct, also took place. An overall downward trend in full, in-depth trademark search orders more generally, as shared by the one of the leading search companies present, was also covered. The unique risks attached to working with smaller agencies, including the absence of enterprise software licenses, was also discussed. Law and Policy | Rules of the Road in Engaging with Celebrities, Influencers, and Fans: This session brought a global perspective to how companies interact with and negotiate with celebrities and influencers in relation to the promotion of their brands. The panelists focused on how they prioritize and make use of time and resources depending upon the nature and length of a promotion, as well as the potential impact of the promotional activities on their brands. Interestingly, in Argentina, many companies create specific scripts that must be used by influencers to help minimize regulatory and legal risks. Aside from potential pitfalls in agreements, the panelists also discussed deepfakes and artificial intelligence and the impact on their promotional activities and on their brands, as well as issues with poor influencer behavior and even taxation issues. Truly, an ever-evolving area as technology becomes even more intwined in the influencer landscape. Successfully Mediating IP Disputes: Key Insights and Practical Tips – INTA’s ADR Committee hosted a panel discussion on trademark mediation, highlighting the growing value of mediation in resolving IP disputes. Panelists emphasized its advantages over litigation, including lower costs, reduced risk, and the opportunity for creative, business-focused solutions. They discussed the qualities of effective mediators, such as neutrality, communication skills, and business acumen, and considered whether mediators should propose solutions or simply facilitate dialogue. The consensus favored a balanced approach that maintains neutrality while offering constructive suggestions. The discussion also addressed the importance of preparation, confidentiality, and having decision-makers present. Challenges of virtual mediation were noted, including distractions and reduced engagement, as well as the supportive but limited role of AI. Real-world examples illustrated the need for mediators to guide the process while allowing parties to retain control over outcomes. Annual Review of Trademark Cases: Always an attendee favorite, this session featured an overview of trademark decisions over the last 12 months lead by Theodore Davis of Kilpatrick Townsend and John Welch of The TTABlog fame. Notable decisions include those upholding the validity of the Lanham Act’s “names clause” (requiring written consent to register a mark containing a person’s name) under the First Amendment (Vidal v. Elster, 602 U.S. 286 (2024)), confirming that inaccurate patent claims may provide grounds actionable false advertising claims (Crocs, Inc. v. Effervescent, Inc., No. 22-2160 (Fed. Cir. 2024)), holding mere use of a party’s name in a judicial proceeding is not actionable under Lanham Act (Dieujuste v. Sin, No. 24-1522-cv (2d Cir. 2025)), confirming that the TTAB’s “something more” doctrine applies only to the relatedness of goods to services and not to goods to goods (In re Samsung Display Co., Ltd., No. 90502617 (T.T.A.B. 2024)), and clarifying that product color resulting from practicing an expired patent cannot also have trademark significance because the color is functional under the expired patent (CeramTec GmbH v. Coorstek Bioceramics LLC, No. 2023-1502 (Fed. Cir. 2025)). John Welch also recounted his top losing TTAB arguments, with the number one slot belonging to arguments that attempt to impart in real-world limitations to goods/services in an application/registration (since the TTAB typically only considers the goods/services as listed), and listed some of his pet peeves, such as using the word “trademark” as a verb (ironically used as such by the Supreme Court in its Elster decision).

The United States Supreme Court issued a unanimous decision in Dewberry Group, Inc. v. Dewberry Engineers Inc., vacating a nearly $43 million profits award and remanding the case for further consideration. The Court concluded that the Lanham Act’s provision allowing plaintiffs to “recover [a] defendant’s profits” did not permit the lower courts to include profits generated by Dewberry Group’s affiliate entities that were not parties to the case. Under the plain statutory language, those profits are limited to named defendants. The Court declined to consider, but did not rule out, alternate theories supporting the award, including the Lanham Act’s “just-sum” provision and corporate veil-piercing, leaving the door open to those theories on remand. Rather unsurprisingly, the roots of this case stem from the parties’ use of the name DEWBERRY. The parties reached a settlement in 2007 governing use of the name in the real estate sector, but things took a turn in 2017 after Dewberry Group rebranded in a way that Dewberry Engineers contends violated the agreement and infringed its rights in various DEWBERRY-formative marks. Dewberry Engineers sued and ultimately prevailed. While calculating damages, Dewberry Group argued that no disgorgement of profits was appropriate because it operated at a loss for decades. Dewberry Engineers, on the other hand, argued successfully that the profits generated by Dewberry Group’s affiliated entities should form the basis of a profits award since the entities were all owned by the same person and serviced one another. For example, Dewberry Group provides various financial accounting, human resources, and legal services to its affiliated sister entities, which in turn leased commercial property to commercial tenants for a profit. The district court totaled the profits from all of these affiliated entities, producing an award of nearly $43 million. The Fourth Circuit agreed and affirmed the district court’s award. In defending the award before the Supreme Court, Dewberry Engineers effectively abandoned the theory that the award could be supported by the Lanham Act’s profits provision and instead contended the award was proper under the Lanham Act’s just-sum provision (which permits a court to adjust a recovery if found to be inadequate or excessive) and corporate veil-piercing theories. As foreshadowed by the tenor of oral arguments, the Court easily concluded that profits under the Lanham Act are limited solely to those generated by named defendants in a case and that “affiliates’ profits are not . . . statutorily disgorgable.” Because Dewberry Group’s affiliates were not named defendants, Dewberry Engineers could not access those affiliates’ profits under the Lanham Act’s profits provision. The Court also declined to consider Dewberry Engineers’ alternate arguments based on the Lanham Act’s “just-sum” provision and corporate veil-piercing theories because they were not raised or considered below, sending the case back for further consideration on these points. The Lanham Act’s just-sum provision permits courts to “enter judgment for such sum as the court shall find to be just. . . [i]f the court shall find that the amount of the recovery based on profits is either inadequate or excessive.” 15 U.S.C §1117(a). Dewberry Engineers contended the district court properly followed a two-step process to support the award under this theory: first, the court assessed the adequacy of the award and then, second, considered relevant evidence in order to adjust the award. The Court disagreed, concluding that the district court never relied on the just-sum provision or engaged in any two-step process. Rather, the district court simply calculated the defendant’s profits by including profits attributed to affiliate entities. The Court’s opinion closes with a detailed discussion of what it does not decide, leaving much for the lower courts to consider on remand. First, it expresses no view on the applicability of the just-sum provision; it merely concludes that it was not properly invoked. Second, the Court does not take any view on the Government’s amicus position regarding when courts can “look behind a defendant’s tax or accounting records” to identify “true financial gain.” Finally, the Court has no opinion whether corporate veil-piercing theories may be considered on remand. In her concurring opinion, Justice Sotomayor writes separately to “underscore that principles of corporate separateness do not blind courts to economic realities.” She provided examples in which a defendant’s profits under the Lanham Act could properly include revenues assigned to an affiliate or diverted through anticipatory assignment schemes to an affiliate, or indirect compensation from the infringing activities of affiliates. She also notes that, on remand, the courts below “may explore that important issue and consider reopening the record if appropriate,” perhaps nudging the courts to delve into these issues. So, with one theory for damages eliminated, this nearly 20-year legal battle trudges on with many questions left unanswered. The TMCA will continue to track the case as it winds its way back through the courts.

The United States Patent and Trademark Office (“USPTO”) recently issued a final rule adjusting certain trademark fees for United States trademark applications and registrations. Most aspects of the rule go into effect January 18, 2025, so practitioners and rights holders should be ready for the change and plan ahead to avoid unnecessary costs if possible. Fee Changes Unlike the across-the-board 7.5% fee increase issued on the patent side of the USPTO, the trademark fee increases are a bit more surgical, with different changes to 28 individual actions. Notable changes include: Introduction of a single base application While applicants previously had the option to file a TEAS Plus or TEAS Standard application, the new system provides a single base application option for applications filed under Sections 1 (based on use or intent to use) and 44 (based on foreign registration).  Depending on the complexity and completeness of applications, applicants may see additional fees. Additional fees for use of free-form text With the removal of the TEAS Standard application, applicants must now pay an additional $200 per class to use a free-form text box for goods and services for Section 1 and 44 applications. Essentially, filing for any goods or services that cannot be found in the Trademark ID Manual will come with an automatic $200/class fee, covering up to 1,000 text characters per class. Additional fees for lengthy goods/services descriptions Using the free-form text box for goods/services that exceed 1,000 text characters per class will now come with a $200 surcharge per additional 1,000 characters. For example, a goods description reaching 2,500 characters will now come with an additional $400 surcharge.  This character limit does not apply when using standard goods/services from the Trademark ID Manual. Notably Section 66 (WIPO) applications are not subject to the same types of surcharges for lengthy goods/services descriptions.  Rather, the USPTO has merely increased the filing fee by $100 per class.  This change for WIPO applications goes into effect slightly later, on February 18, 2025. Practical Implications The main messaging from these changes is efficiency, efficiency, efficiency. Given the addition of various extra fees for lengthy or non-standard filing descriptions, applications missing basic information, and extra classes in general, applicants may be encouraged to “tighten up” filing strategies. One way in which practitioners may be more economical long term is by using the USPTO’s TMID Manual entry suggestion tool. The USPTO accepts suggestions for entries into the Manual by emailing tmidsuggest@uspto.gov. For applicants who may re-use goods/services descriptions that do not appear in the TMID Manual, this may be an effective tool for avoiding the free-form text fee discussed above. Summary of Important Changes Fee Description Current Fee Fee as of 1/18/25 Fee Change Notes Trademark Application Fees Base application (Sections 1 and 44) N/A $350, per class New fee TEAS Plus and TEAS Standard application filing options merged to single “base application” filing option. Insufficient information in application (Sections 1 and 44) N/A $100, per class New fee Surcharge will apply if Section 1 or 44 application fails to satisfy any of the requirements under 37 CFR § 2.22(a)(1) - (19). These requirements are identical to the requirements for a valid TEAS Plus application under the current TEAS system, and the fee rate for the insufficient information surcharge is identical to the processing fee for failing to meet the requirements of a TEAS Plus application. Use of free-form identification of goods/services (Sections 1 and 44) N/A $200, per class New fee The Free-Form Text for Goods/Services Surcharge will apply for each class where the free-form text box is used instead of the ID Manual function within the electronic application. FREE-FORM TEXT IDs ONLY Each additional group of 1,000 characters after the first 1,000 N/A $200, per class New fee Applicants using the ID Manual function within the electronic application will not incur this surcharge. ·       The USPTO defines characters as including punctuation and spaces. ·       This fee will not be applied to amended identifications that exceed the character limit in a response to an Office Action. ·       Example: if the identification language in a single class is 2,001 characters, then a $400 surcharge is applied. WIPO application/subsequent designation (Section 66(a)) *(Effective February 18, 2025) $500, per class $600, per class ↑$100, per class Goes into effect February 18, 2025. TEAS Standard application $350, per class N/A Discontinued TEAS Standard application filing option discontinued. TEAS Plus application $250, per class N/A Discontinued TEAS Plus application filing option discontinued. Failing to meet TEAS Plus requirements $100, per class N/A Discontinued TEAS Plus application filing option discontinued. Statements of Use/Amendments to Allege Use Amendment to Allege Use (AAU) $100, per class $150, per class ↑$50, per class Statement of Use (SOU) $100, per class $150, per class ↑$50, per class Post Registration Maintenance/Renewal Renewal (Section 9) $300, per class $325, per class ↑$25, per class Declaration of Use (Sections 8 or 71) $225, per class $325, per class ↑$100, per class Affidavit of Incontestability (Section 15) $200, per class $250, per class ↑$50, per class Renewal fee filed at WIPO *(Effective February 18, 2025) $300 $325 ↑$25 Goes into effect February 18, 2025. Miscellaneous Fees Letters of Protest $50 $150 ↑$100 Petitions to the Director $250 $400 ↑$150 Petitions to Revive $150 $250 ↑$100 *This chart is for informational purposes only.

How far does the Lanham Act’s reach extend? The Supreme Court gave us one answer in Abitron Austria GmbH et al. v. Hetronic International, Inc. and made it simple: not very far. Hetronic is a U.S. company that manufactures remote controls for construction equipment.  Abitron (comprised of six non-U.S. companies) at one point sold Hetronic’s products as a licensed distributor.  However, Abitron eventually concluded it held rights to Hetronic’s intellectual property, including various trademarks.  Abitron then reverse engineered Hetronic’s products and began selling goods bearing those marks in Europe and the U.S. Hetronic ultimately sued Abitron in the Western District of Oklahoma for trademark violations under Sections 1114(1)(a) and 1125(a)(1) of the Lanham Act, both of which prohibit using a trademark “in commerce” that is likely to cause confusion.  The District Court awarded Hetronic approximately $96 million in damages and entered a permanent injunction barring Abitron from using Hetronic’s marks anywhere in the world. We last discussed Hetronic after a Tenth Circuit decision that narrowed the injunction slightly to geographic locations where Hetronic had marketed and sold its products.  But the Tenth Circuit overall agreed that some of Abitron’s conduct in Europe could be enjoined by U.S. courts under the Lanham Act because Abitron’s actions had a substantial effect on U.S. commerce.  Abitron then appealed to the Supreme Court, arguing the injunction was an impermissible extension of the Lanham Act to extraterritorial conduct—i.e., conduct outside the U.S. Today, the Supreme Court vacated and remanded the Tenth Circuit’s decision, determining that the two provisions of the Lanham Act at issue cannot be applied extraterritorially.  The Court held that the Lanham Act only regulates use in commerce—i.e., the sale of goods or the provision of services—within the United States.  The Court’s analysis centers on a presumption against extraterritoriality, a “longstanding principle of American law” that assumes Congress generally only regulates domestic affairs, and not foreign conduct.  Four justices joined Justice Alito’s majority opinion, three joined Justice Sotomayor’s concurrence, and Justice Jackson entered a separate concurrence with her insights on the definition of “use in commerce” as used in Section 1127 of the Lanham Act. The Court applied a two-step framework to determine whether and to what extent the Lanham Act can regulate foreign conduct. All Justices agreed that the first question is whether the statute or provision explicitly states that it should apply to foreign conduct.  In other words, has Congress “affirmatively and unmistakably instructed that” the provision at issue “‘should apply to foreign conduct’”?  The Lanham Act does not explicitly state that it regulates foreign conduct, which cuts against applying the Lanham Act to regulate conduct abroad. Because the Lanham Act is not explicitly extraterritorial, the Court then moved to step two, which was far more contentious.  The majority concluded the relevant inquiry for this step is to identify the “focus” of the statute and decide whether “conduct relevant to that focus” occurred in the U.S.  Both are required. The parties offered different interpretations of what they believed the “focus” of the Lanham Act provisions were in this case for purposes of the second step of the framework.  Hetronic argued that the focus of the statute was to protect the goodwill of trademark owners and to prevent consumer confusion.  Abitron argued that the focus of the statute was to prevent infringement of trademarks. The U.S. government, as amicus curiae, took the middle ground and posited that the focus of the statute was consumer confusion. Instead of clarifying the Lanham Act’s focus, the Court concluded that, because the conduct at issue entirely occurred outside the U.S., there was no need to actually discern the focus of the statute. In other words, the fact that there was no conduct or domestic use in commerce renders the focus of the Lanham Act irrelevant.  This second step, the majority clarified, is designed for "claims that involve both domestic and foreign activity," which is not the case here. Justice Jackson agreed that “use in commerce” is “the dividing line between foreign and domestic applications” of the Lanham Act, but added that any downstream sale of a good in the U.S. market constitutes use in commerce. In other words, the active resale of a good by an individual consumer, who bought a product abroad, would constitute use in commerce and open the original seller of the good to liability under the Lanham Act. Contrary to the framework outlined by the majority, however, Justice Sotomayor found common ground with the U.S. government’s opinion that the focus of the two provisions of the Lanham Act at issue is consumer confusion.  This interpretation focuses on the impact of foreign conduct on the U.S. market instead of exclusively on “the location of the original sale of the infringing product or the location of the trademark owner’s business.”  In other words, Justice Sotomayor would conclude that the Lanham Act provisions at issue extend to “activities abroad when there is a likelihood of consumer confusion in the United States.”  (Emphasis added.) The at-odds opinions may be attributable to the manner in which the justices choose to interpret the case Steele v. Bulova Watch Co. (which involved a defendant’s allegedly infringing activities occurring in both Mexico and the United States), with the majority determining it is inapplicable and wholly distinguishable from the facts of Hetronic because it “implicate[s] both domestic conduct and a likelihood of domestic confusion,” and the Sotomayor concurrence finding Steele to persuasively conclude that “infringing acts consummated abroad fall under the purview of the Lanham Act when they generate consumer confusion in the United States.”  In the majority’s view, the concurrence’s position would render the presumption against extraterritoriality, referred to in other cases as a “watchdog,” “nothing more than a muzzled Chihuahua.” Ultimately, the Court vacated and remanded the case.  The majority does not outline the bounds of “use in commerce.”  Whether the Lanham Act applies to goods sold indirectly into U.S. commerce remains to be seen.  The TMCA will continue to monitor this case on remand and the impacts of the decision in the broader trademark landscape.

Humor matters, but it’s not the most important thing when considering a trademark infringement or dilution claim. In a decision with references to The Hangover Part II, Aqua’s song “Barbie Girl” (good luck not getting that stuck in your head if you grew up in the 90’s…), Tommy Hilfiger, and Harley-Davidson, the Supreme Court clarified the interaction of First Amendment protections, on the one hand, and trademark infringement and dilution claims involving “expressive works,” on the other hand. The bottom line is this: where an accused infringer uses a trademark like a trademark (i.e., to designate the source of its goods or services), the traditional likelihood of confusion analysis applies, even if the mark is also used in an expressive manner. First Amendment considerations like parody and commentary might impact that analysis, but there’s no threshold First Amendment consideration (like the Rogers test discussed below) that would prevent or bar this traditional analysis. Further, marks used in connection with commentary, criticism, and parody are not exempt from dilution claims when the mark is being used to designate the source of goods or services. As discussed in a prior TMCA blog post, this case arises out of Jack Daniel’s trademark infringement and dilution claims against VIP Products based on its “Bad Spaniels” dog toy. The Jack Daniel’s bottle and VIP dog toy are shown here: Beyond the similarities in the bottle and label, VIP’s product contained other clear nods to Jack Daniel’s, including using “Bad Spaniels” instead of “Jack Daniel’s” and the wording “The Old No. 2, on Your Tennessee Carpet” instead of “Old No. 7 Brand Tennessee Sour Mash Whiskey.” The packaging also included a disclaimer, stating, “This product is not affiliated with Jack Daniel Distillery.” VIP claimed the dog toy was an obvious parody of Jack Daniel’s products and, thus, entitled to First Amendment protection under the Rogers test for the infringement claim and also entitled to a statutory exception to the dilution claim as a parody of a famous mark. When an “expressive work” is involved, the Rogers test requires dismissal of a trademark infringement claim unless the plaintiff can show that either (1) the challenged use of a mark has no artistic relevance to the underlying work or (2) the work explicitly misleads as to the source or the content of the work. See Rogers v. Grimaldi, 875 F.2d 994 (2d Cir. 1989). The District Court ruled in Jack Daniel’s favor, rejecting application of the Rogers test because VIP used the mark to identify its own goods. It further concluded that the dilution exception did not apply for essentially the same reason. VIP appealed to the Ninth Circuit, which reversed and remanded, holding that: (1) the infringement claim could not stand because the “Bad Spaniels” dog toy is an expressive work entitled to First Amendment protection under the Rogers test since it “communicate[d] a humorous message,” and (2) VIP’s parody shielded it from liability for dilution under the non-commercial use exception. VIP Prods. LLC. V. Jack Daniel’s Props., 953 F.3d 1170 (9th Cir. 2020). On remand and given the Ninth Circuit’s directive, the District Court concluded that Jack Daniel’s could not satisfy the Rogers test and granted summary judgment to VIP. The Ninth Circuit summarily affirmed, and the Supreme Court granted Jack Daniel’s writ of certiorari to determine: Whether humorous use of another’s trademark as one’s own on a commercial product is subject to the Lanham Act’s traditional likelihood-of-confusion analysis, or instead receives heightened First Amendment protection from trademark infringement claims. Whether humorous use of another’s mark as one’s own on a commercial product is “noncommercial” under 15 U.S.C. § 1125(c)(3)(C), thus barring as a matter of law a claim of dilution by tarnishment under the Trademark Dilution Revision Act. In the Supreme Court’s majority opinion authored by Justice Kagan (the decision was unanimous, but with two concurrences), the Court first addresses the question, “Should [Jack Daniel’s] have had to satisfy the Rogers threshold test before the case could proceed to the Lanham Act’s [the U.S. trademark law] likelihood-of-confusion inquiry?” The Court found it should not have, stating: Without deciding whether Rogers has merit in other contexts, we hold that it does not when an alleged infringer uses a trademark in the way the Lanham Act most cares about: as a designation of source for the infringer’s own goods… When a mark is used as a mark (except, potentially, in rare situations), the likelihood-of-confusion inquiry does enough work to account for the interest in free expression. The Court parts ways with the Ninth Circuit’s previous holding, making it clear that a mark’s expressive content does not result in automatic application of the Rogers test. Despite fulsome briefing on the topic, the Court does not actually rule on the validity of Rogers. However, it certainly spends quite a bit of time considering the case’s history and application over the last 30+ years since its inception, citing to cases such as Mattel, Inc. v. MCA Records, Inc., 296 F. 3d 894 (9th Cir. 2002) (finding the song “Barbie Girl” did not use Barbie’s name in a source-identifying capacity and, thus, First Amendment protection was warranted) and Louis Vuitton Mallatier S. A. v. Warner Bros. Entm’t Inc., 868 F. Supp. 2d 172 (S.D.N.Y. 2012) (finding that mention of “Louis Vuitton”—pronounced “Lewis” in the film The Hangover Part II—satisfied the Rogers test because the film did not use the trademark as its “own identifying trademark.”). These courts (including the home of the Rogers test in the Second Circuit) have routinely declined to apply the Rogers test when the marks in question are being used as true trademarks (i.e., to designate source rather than for commentary or pure expression). This aligns with the primary purpose of the Lanham Act, which makes explicitly clear that, when another party uses a mark in a way which confuses consumers as to the source of the goods, infringement has occurred. 15 U.S.C. § 1114(1). The Court emphasizes that applying the Rogers test in all instances where a mark conveys other expressive content (such as a humorous message) could result in “Rogers [taking] over much of the world. For trademarks are often expressive in any number of ways.” The Court also cites to every trademark attorney’s best friend, McCarthy on Trademarks and Unfair Competition, which agrees that the Ninth Circuit’s expansion of Rogers “potentially encompasses just about everything” because names, phrases, symbols, designs, and their varied combinations often “contain some ‘expressive’ message” unrelated to source. 6 McCarthy on Trademarks and Unfair Competition § 31:144.50 (5th ed. 2022). Because VIP conceded it was using the BAD SPANIELS trademark and trade dress to “identify and distinguish [VIP’s] goods” and to “indicate [their] source,” the Court concluded that Rogers does not apply. Though VIP attempted to backtrack on those comments during oral arguments, the Court was not persuaded, pointing to the below hangtag that clearly shows the BAD SPANIELS mark situated similarly to the company’s registered SILLY SQUEAKERS Logo. Despite the inapplicability of Rogers, the Court explained that, on remand, the lower courts should still consider the thrust of VIP’s argument because “[a] trademark’s expressive message—particularly a parodic one, as VIP asserts—may properly figure in assessing the likelihood of confusion.” In other words, where a trademark is truly used as a trademark, expression must be considered in the context of the normal likelihood of confusion analysis rather than as a threshold question. It will be interesting to see whether this directive results in amendment of the infringement factors used by the various circuits, such as the Sleekcraft factors in the Ninth Circuit. In the second portion of the opinion, the Court swiftly dispatches the Ninth Circuit’s holding that the use of humor and parody constitute noncommercial use, which is excluded from dilution liability under the Lanham Act. See 15 U.S.C. §1125(c)(3)(C). The Lanham act provides an exclusion for a claim of dilution when use of a mark constitutes “fair use”, which specifically covers uses “parodying, criticizing, or commenting upon” a famous marks owner. Id. at §1125(c)(3)(A)(ii). Critically, however, this exclusion does not apply when the use is “as a designation of source for the person’s own goods or services.” Id. In line with its analysis of the first question presented, the Court concludes that, given “the fair-use provision’s carve-out, parody (and criticism and commentary, humorous or otherwise) is exempt from liability only if not used to designate source.” The Ninth Circuit’s expansive view of the non-commercial use exclusion does not align with Congress’s express limit placed on the fair-use exclusion, the Court found. The concurrences also contain some interesting tidbits. Although the majority opinion declined to rule on the validity of Rogers, the concurrence by Justice Gorsuch (joined by Justices Thomas and Barrett) directly calls into question Rogers, stating that it is “not entirely clear where the Rogers test comes from” and that “it is not obvious that Rogers is correct in all its particulars.” It warns lower courts that they “should be attuned to that fact.” The concurrence by Justice Sotomayor (joined by Justice Alito) warns that courts should “treat the results of surveys with particular caution” where “trademark infringement involves a parody” since “there is a particular risk in giving uncritical or undue weight” to these surveys. It points to one survey answer in this case that will give most IP attorneys instant heartburn: “The bottle is mimicked after the Jack Daniel BBQ sauce. So they would hold the patent therefore you would have to ask permission to use the image.” In the coming months, the lower courts will likely hear from Jack Daniel’s and VIP as they hash out the likelihood of confusion and dilution aspects of this case, and other courts will continue to refine the Rogers test (so long as it stands) and likelihood of confusion analysis articulated in this case. Keep an eye out on the TMCA blog for further coverage.  

Justices of the Supreme Court will soon put on their whiskey glasses to decide the proper tests for infringement and dilution claims involving humorous use of another’s trademark. The Court granted certiorari in November to consider a dispute between VIP Products, LLC (“VIP”) and Jack Daniel’s Properties, Inc. (“Jack Daniel’s”) over VIP’s “Bad Spaniels” dog toy, which Jack Daniels contends infringes and dilutes its famous trademarks and which VIP asserts is permissible under the First Amendment. As discussed in a prior TMCA post, the dispute arose in 2014, after Jack Daniel’s sent a letter demanding that VIP cease all sales of its “Bad Spaniels” dog toy, which VIP had been selling since July 2013. A week later, VIP sought declaratory judgment in the U.S. District Court for the District of Arizona, arguing that it had designed the “Bad Spaniels” label to incorporate a few elements of the Jack Daniel’s label design, but had added a number of additional elements to make it clear that the product was a parody and entitled to First Amendment protection (for example, changing the Jack Daniel’s “Old No. 7 Brand Tennessee Sour Mash Whiskey” to “The Old No. 2, on Your Tennessee Carpet”). Jack Daniel’s counterclaimed, alleging trademark infringement, dilution, and unfair competition. The District Court ultimately granted Jack Daniel’s motion for partial summary judgement, finding VIP was not entitled to the defenses of nominative and First Amendment fair use, because it did not use Jack Daniel’s’ identical marks or trade dress. After a four-day bench trial, the District Court ruled in favor of Jack Daniel’s and permanently enjoined VIP from selling the “Bad Spaniels” dog toy. VIP appealed to the Ninth Circuit, which reversed the District Court on the grounds that: (1) the “Bad Spaniels” dog toy is an expressive work entitled to First Amendment protection, and (2) the District Court failed to require that Jack Daniel’s satisfy at least one of the two prongs of the Rogers test. VIP Prods. LLC. V. Jack Daniel’s Props., 953 F.3d 1170 (9th Cir. 2020); see also Rogers v. Grimaldi, 875 F.2d 994 (2d Cir. 1989) (holding that the Lanham Act only applies to expressive works if the plaintiff establishes that the defendant’s use of the mark either: (1) is not artistically relevant to the underlying work, or (2) explicitly misleads consumers as to the source or content of the work). On the dilution claim, the Ninth Circuit also reversed the District Court, because, although VIP used the Jack Daniel’s trade dress and bottle design to sell the dog toy, these elements were also used to convey a humorous message which was protected by the First Amendment, and thus “noncommercial.” Although Jack Daniel’s petitioned for a writ of certiorari in 2020 seeking review of the Ninth Circuit’s decision, the Court denied the petition. On remand, the District Court found that, based on the Ninth Circuit’s decision, the “Bad Spaniels” toy was entitled to First Amendment protection because Jack Daniel’s could not satisfy either prong of the Rogers test. The Ninth Circuit summarily affirmed. In August 2022, Jack Daniel’s again petitioned for a writ of certiorari asking the Court to consider the following questions: Whether humorous use of another’s trademark as one’s own on a commercial product is subject to the Lanham Act’s traditional likelihood-of-confusion analysis, or instead receives heightened First Amendment protection from trademark infringement claims. Whether humorous use of another’s mark as one’s own on a commercial product is “noncommercial” under 15 U.S.C. § 1125(c)(3)(C), thus barring as a matter of law a claim of dilution by tarnishment under the Trademark Dilution Revision Act. Apparently persuaded the second time around, the Court granted Jack Daniel’s’ petition and agreed to hear the case. In its writ, Jack Daniel’s contends that that the Ninth Circuit’s ruling “departs from the decisions of every other circuit to decide this question” and claims it “paves the way for companies like respondent to unleash mass confusion in the marketplace.” It appears that the International Trademark Association agrees and filed an amicus brief arguing: Since the Second Circuit’s decision in Rogers, all other circuits but the Ninth have faithfully limited Rogers to traditionally expressive or artistic works like movies, art, books, and the like. The Ninth Circuit’s decision below continues that circuit’s inappropriate (and concerning) steady expansion of Rogers to any product or service that merely contains discernible expression. This unwarranted expansion beyond the roots of Rogers creates a sharp circuit split on how to balance competing claims of trademark protection and free speech in the context of ordinary commercial products. The Ninth Circuit’s decision threatens a trademark infringement framework that has been intact and applied for nearly a century. Ultimately, if the Court sides with VIP, it would seem to represent a fairly significant expansion of how the Rogers test has typically been applied since it was first articulated in 1989. Notably, an expansion of the types of works covered under the Rogers test would likely leave brands with a narrower scope of protection when dealing with potential infringers claiming “parody” and “artistic expression.” Further, given that the Court is currently considering the Andy Warhol Foundation for the Visual Arts, Inc. v. Goldsmith case (which involves fair use in the copyright context and which the TMCA has covered here), the Court appears eager to define the role of the First Amendment in intellectual property cases. And the opinion in the Warhol case will almost certainly provide insight into the Court’s likely treatment of the issues in this case. We will be following this case closely, so keep an eye out for our eventual breakdown of the Court’s opinion.

Technology is changing, but is copyright law keeping up? Stephen Thaler clearly believes it is not and has sued the U.S. Copyright Office over its refusal to register artwork created by his artificial intelligence software. You may remember Thaler from a previous TMCA article discussing his bid to obtain a patent for an AI-generated invention, which the U.S. Patent and Trademark Office rejected on the ground inventorship requires a “natural person.” In November 2018, Thaler filed a copyright application for the artwork shown above, listing the author of the work as the “Creativity Machine” (which is an AI program created by Thaler that autonomously created the work). The Copyright Office refused to register the work based on the (at least current) axiom that human authorship is necessary to support a copyright claim. The Copyright Review Board upheld the refusal in February 2022, stating it “is compelled to follow Supreme Court precedent, which makes human authorship an essential element of copyright protection.” Last month, Thaler filed a federal lawsuit challenging the Copyright Office’s decision under the Administrative Procedure Act. The main thrust of his position is that the Copyright Act affords protection to “original works of authorship” and makes no specific reference to “human authorship.” Thaler points to the fact that corporations and other “non-human entities” have been considered authors under the Copyright Act for over a century, and the extension to AI is consistent with this principal. He also contends no case has directly ruled on the issue of AI-generated works, which is significant because AI is capable of “producing creative output that, at least functionally, is equivalent to ‘the fruits of intellectual labor’ that ‘are founded in the creative powers of the mind.’” Thaler also advances a number of property-based theories, including based on accession, first possession, and the work-made-for-hire doctrine. Given the current state of the case law, Thaler likely faces an uphill battle. Courts, including the Supreme Court, have uniformly interpreted the Copyright Act to require human authorship, citing to Burrow-Giles Lithographic Co. v. Sarony, 111 U.S. 53, 56 (1884) as the origins of the concept, where the Court referred to authors as human. Since then, the Court has cited to Burrow-Giles in ways that seem to require human authorship, such as in Mazer v. Stein, 347 U.S. 201, 214 (1954), where it concluded a work “must be original, that is, the author’s tangible expression of his ideas.” 347 U.S. 201, 214 (1954) (emphasis added). In Goldstein v. California (again citing to Burrow-Giles), the Court also held that, “[w]hile an ‘author’ may be viewed as an individual who writes an original composition, the term in its constitutional sense, has been construed to mean an ‘originator,’ ‘he to whom anything owes its origin.’” 412 U.S. 546, 561 (1973) (emphasis added). Lower courts have also applied the human requirement to copyright authorship. For example, materials allegedly “‘authored’ by non-human spiritual beings” are not entitled to copyright protection without “human selection and arrangement of the revelations,” Urantia Found. v. Kristen Maaherra, 114 F.3d 955 (9th Cir. 1997), and a monkey is not entitled to claim copyright protection for a selfie because “humanity excludes animals,” Naruto v. Slater, 888 F.3d 418, 426 (9th Cir. 2018). But, despite the challenges, this case is an important one. AI is becoming increasingly present in our everyday lives, extending far beyond the scientific realm. As shown here, AI machines can now produce creative works, including music, inventions, and artwork. The human-authorship requirement could have negative implications for the growth and advancement of this relatively nascent technology. Why dedicate resources to creative AI when the work product will not receive copyright protection and can be exploited by others without remedy? Time will tell but, for now, the current landscape leaves AI creations in a less than picture-perfect world. The TMCA will continue to track this developing issue, including another forthcoming article more broadly discussing AI authorship.      

Attention trademark practitioners: the finalized rules implementing the 2020 Trademark Modernization Act (“TMA”) go into effect this weekend, on December 18, 2021. Significantly, this marks the availability of three new mechanisms for eliminating “deadwood” registrations: petitions for reexamination, petitions for expungement, and a new nonuse (expungement) cancellation ground. We previously wrote in detail about these three changes here. The PTO will begin accepting petitions for reexamination and expungement starting December 27, 2021, but the new nonuse cancellation ground will presumably be available as of the 18th. The chart below compares these new procedures. Starting in about a year (on December 1, 2022), the office action response period for most trademark applications will shrink to three months from the current six-month response period. But a three-month extension may be requested for a fee of $125, and the response period for Madrid Protocol applications will remain six months. The TMCA will continue to monitor and provide updates on the impacts of the TMA.  

Roc-A-Fella Records (“RAF”) owners Jay-Z and Damon Dash are clashing over Dash’s plans to sell an NFT (“nun-fungible token”) representing either a 1/3 share of the copyright to Jay-Z’s album Reasonable Doubt (if you believe RAF and Jay-Z) or a 1/3 ownership interest in RAF as a whole (if you believe Dash). If you’re wondering what an NFT is, auction house Christie’s (which brokered a staggering $69 million sale of an NFT created by artist Beeple in March 2021) has a great in-depth article. To summarize (a lot), an NFT is basically a unique digital certificate representing ownership of a unique thing (e.g., a song, work of art, etc.) that is stored, verified, and transferred using blockchain technology. NFTs are created (or “minted”) using tamper-proof, self-executing contracts tied to a specific blockchain set, like Etherium. In late June, Jay-Z (through RAF) obtained a temporary restraining order barring Dash from auctioning an NFT for Reasonable Doubt or doing anything else that could impact ownership rights in the album. In its complaint, RAF claims that Dash was working with a platform called SuperFarm Foundation to auction an NFT, which according to a SuperFarm memo attached to the complaint, would represent “Damon’s [1/3] ownership of the copyright to Jay-Z’s first album.” The problem, according to RAF, is that Dash does not actually own any copyright interest in the album. Rather, RAF owns the entire copyright to the album per Jay-Z’s 1995 agreement with RAF (the entirety of which is actually appended to the complaint—interesting reading). Although RAF convinced SuperFarm to stop the auction by the time it filed the complaint, RAF claims that Dash had already minted an NFT for the album would surely try to sell it elsewhere. For his part, Dash actually agrees with RAF and Jay-Z on the copyright ownership point. In his response opposing the restraining order, Dash freely admits that RAF owns the album entirely. However, he claims the SuperFarm memo (and, thus, RAF’s complaint) misstates the intended nature of the NFT auction. Dash says he never minted an NFT but that the NFT he planned to create was supposed to be for his entire 1/3 ownership of the RAF entity and not for the specific copyright interest in Reasonable Doubt. Any ownership of the album would merely result from owning a share of RAF. The lawsuit, according to Dash, is all part of Jay-Z’s ploy to prevent Dash from sell his shares in RAF (which the initial temporary restraining order arguably accomplished). Dash further argues that the firm Quinn Emmanuel, which filed the lawsuit on behalf of RAF, should be disqualified due to an ethical conflict. The firm, he alleges, represents Jay-Z individually in matters involving RAF corporate governance and now represents RAF in a lawsuit against another RAF shareholder, namely, Dash. Dash also alleges that Jay-Z lacked authority to even retain Quinn Emmanuel on behalf of RAF because Dash is the only person authorized to enter into contracts or retain counsel on behalf of RAF, causing a further conflict of interest. On July 2, the parties participated in a show-cause hearing. Dash was successful in convincing RAF and the court to limit the restraining order. The parties and court agreed to include language stating that the order does not “prevent Dash from selling, assigning, pledging, encumbering, contracting with regard to, or in any way disposing of his one-third (1/3rd) ownership interest in RAF, Inc. to the extent it may otherwise be transferred in compliance with applicable laws”. In a transcript of the hearing attached to RAF’s post-hearing filing, the court also rejected Dash’s arguments that Quinn Emmanuel should be disqualified, finding that there was no evidence Quinn Emmanuel had privileged information concerning Dash and that Jay-Z and RAF’s interests were aligned in the proceeding. Addressing the apparent heart of the dispute, the court asked RAF what other evidence it has that Dash was trying to sell a copyright interest in the album as opposed to his shares in RAF. During the hearing and in its post-hearing filing, RAF argued that Dash is under extreme financial pressure due to multiple liens and that he likely saw an opportunity to profit from the 25th anniversary of Reasonable Doubt. The filing also includes orders from past cases in which courts found Dash not to be credible or disruptive to those proceedings. Dash also responded by filing his own lawsuit against Jay-Z in New York state court, claiming that Jay-Z has impermissibly transferred streaming rights to Reasonable Doubt to his personal LLC (summons available here – link to ). To make things more complicated, Dash’s suit also lists RAF as a plaintiff. So, RAF is now suing both Dash and Jay-Z in their personal capacities as individual owners of RAF. Although the case is only in its earliest stages, it highlights some interesting legal issues in the emerging NFT space. First, despite all the talk of copyright, RAF’s complaint does not actually make a copyright infringement claim against Dash. The claims are essentially all property based (with the exception of breach of fiduciary duty and unjust enrichment claims). Based on a quick search of the Copyright Office website, the copyright to Reasonable Doubt appears to be registered, so RAF would presumably have grounds to file a copyright lawsuit if it wanted to. So why didn’t RAF include a copyright claim? It’s hard to know for sure, but one potential issue is that Dash may not have copied Reasonable Doubt, even assuming he already minted an NFT for the album (a fact he disputes). An NFT does not typically contain a copy of the actual work to which it relates. Rather, the underlying work is stored somewhere else and/or the NFT simply references the work. Thus, even if Dash had minted an NFT representing a copyright interest in the album, he would not have necessarily made any copies of the album and may not ever need to make any copies. Second, assuming Dash does intend to sell his ownership share of RAF as an NFT, as opposed to the copyright to Reasonable Doubt, this might create unintended consequences for Dash. An offer to sell shares of a highly valuable company via an NFT to essentially anyone in the world would likely be considered a securities offering, which could subject him to numerous disclosure and reporting requirements. At this point, the U.S. Securities and Exchange Commission’s public search system EDGAR does not appear to show any filings by Dash or SuperFarm related to any such sale. Third, the dueling lawsuits are certain to raise some interesting issues related to corporate authority given that both Dash and Jay-Z have sued one another on behalf of RAF. This might also press the conflicts issues previously raised by Dash, potentially for both sets of attorneys, who now each claim to represent RAF as an entity and the individual owners of RAF in disputes between RAF and those owners. The TMCA will be monitoring the case.

The FTC recently reached deals with six CBD companies after it issued formal complaints against them in December 2020 over concerns about deceptive practices. The initial complaints (found here: In re Bionatrol Health, LLC, In re Epichouse, LLC, In re CBD Meds, Inc., In re Easybutter, LLC, In re Reef Industries, Inc., and In re Steves Distributing, LLC) brought various counts against the companies, including allegedly making a wide range of claims about their ability to treat serious health conditions, including cancer, heart disease, hypertension, Alzheimer’s disease, and other diseases. Some complaints also include deceptive pricing allegations. The FTC approved final consent orders resolving all the complaints. Those orders (found here: In re Bionatrol Health, LLC, In re Epichouse, LLC, In re CBD Meds, Inc., In re Easybutter, LLC, In re Reef Industries, Inc., In re Steves Distributing, LLC) obligate the companies to take and avoid various actions, including refraining from making misleading statements about the health benefits of CBD (including that such products prevent Alzheimer’s disease, autoimmune diseases, arthritis, cancer, diabetes, heart disease, seizures, skin cancer or other diseases), refraining from deceptive pricing tactics, notifying customers of the FTC’s lawsuit, and paying fines ranging from $20,000 to $85,000. These orders come on the heels of two years of relatively aggressive enforcement efforts against CBD companies by both the FDA (which we wrote about here) and the FTC. The FDA has already written two more warning letters to CBD companies in 2021, which you can find here. As shown on that same page, the FDA sent 21 letters to CBD companies in 2020 and, in 2019, sent another 22 letters. Sometimes these letters were jointly signed by the FTC, and the FTC has sent other letters to CBD companies over the past years (such as those discussed here). While the FDA continues to consider further regulations governing more widespread use of CBD products, these orders and letters will continue to act as de facto guidance for CBD companies. Dorsey will continue to monitor the FTC's and FDA’s actions in this area.

Just in time to steal ComicMix’s Christmas, the Ninth Circuit recently held that the bookmaker’s mashup story Oh, the Places You’ll Boldly Go! (which combines elements of the Dr. Seuss book Oh, the Places You’ll Go! with Star Trek) is not a defensible fair use under copyright law. The opinion reverses in part a summary judgment ruling by the District Court for the Southern District of California, which we wrote about here. Seuss Enterprises had sued ComicMix for copyright and trademark infringement over Boldly, which features Star Trek characters set in a Seussian world highly reminiscent (and in some instances directly copied from) Go! and other works by Dr. Seuss. The TMCA featured a Seuss-styled introduction to the case here. ComicMix was able to eliminate Seuss’s trademark and associated unfair competition claims on a motion to dismiss. Next, on summary judgment, the district court concluded that ComicMix’s work constituted fair use (and thus defeated Seuss’s copyright claim) because the book was a highly transformative “literary and pictorial ‘mash-up.’” Seuss appealed both decisions. Beginning with its own riff on a quote from Go! (“mash-ups can happen to you”), a unanimous Ninth Circuit panel concluded that none of the four fair use factors favored ComicMix and reversed the district court. Considering the all-important transformative-use factor, the court concluded that “[a]lthough ComicMix’s work need not boldly go where no one has gone before, its repackaging, copying, and lack of critique of Seuss, coupled with its commercial use of [Dr. Seuss’ work], do not result in a transformative use.” Next, the court found that the creative nature of Go! tilted in favor of Seuss. With respect to the amount and substantiality of the work copied, ComicMix “extensive[ly] and meticulous[ly]” copied Go!, and statements in the record showed that ComicMix could have created Boldly without this sort of “wholesale copying.” Finally, the court held that ComicMix’s book “targets and usurps” Seuss’s potential market, including because it intentionally aimed to capitalize on the same graduation market as Seuss. Although Seuss may have gotten its green eggs, it didn’t get its ham. The Ninth Circuit affirmed the district court’s denial of Seuss’s trademark claim. That analysis focused on whether the federal Lanham Act even applies given that the alleged infringing mark is the title of ComicMix’s Boldly. Under the Rogers test, a Lanham Act claim applies only if the allegedly infringing title of an artistic work is (1) not artistically relevant to the underlying work or (2) explicitly misleads consumers as to the source or content of the work. The test was not satisfied because the title helped to achieve ComicMix’s artistic purpose and did not explicitly mislead consumers. The question now is whether ComicMix will seek further review and, if so, whether the Supreme Court will take up the issue. Until then, we leave you with some further Seussian stylings: We wrote ’bout it before, so you’ll want to hear more, Of the rulings on mashups and smashups galore. So come round once again, and listen my friend, To a story that could be quite far from the end. Now, the first-level court, in its SJ report, Found a combo of works a sufficient retort To the claims of the Seuss shouting, “This ain’t fair use! A mashup, transformative? That’s far, far too loose!” Undeterred by a loss from that first-level boss, Seuss went back to work to perfect its next toss. De novo review, don’t you know that it’s true, Can provide quite a different result when it’s through. So appeal Seuss did file ’gainst the judgment reviled, In hopes to proceed to the coveted trial. The Ninth was enthused (and slightly amused), And its notions of fair use downright disabused. “A mashup you say? We don’t see it that way. You took all of their content, and that’s not okay. Your work doesn’t transform and quite far from the norm, In the mind of book buyers ’twill cause a s***storm.” “So go back to the start and take this to heart, Fair use isn’t accomplished by jamming some parts Of a couple of works with some relative quirk Together like some sort of drunk soda jerk.” ’Fore this wears to the bone and again you do groan, I believe that its time that we leave this alone. So, we’ll try to be curt yet remain quite alert, And we’ll see if the masher is granted its cert.

Last week we quickly pivoted from watching the 24/7 "Map Show" to spending our screen time learning at the ANA 2020 Marketing Law Conference. It was a great three days in Chicago in our pajamas of educational seminars. If you didn’t make it this year, don’t worry – here’s a quick wrap-up of the highlights: Influencers – This has been a hot topic at the law conference for many years now. So you may be asking, haven’t we already covered influencers from every possible angle? You might think so, but there are still lessons to be learned in influencer advertising and things in this area are always changing. But some things never change - the keywords for influencers and the advertisers who hire them are transparency and flexibility. Influencer contracts are highly recommended, the more specific the better, so that influencers understand very clearly what’s expected of them. Also, did you hear that #ad is back? It is transparent, simple and works in almost any situation, but influencers and brands have long shunned it, while lawyers loved it. Are we finally all going to agree on something? Consumer Reviews – With access to brick and mortar stores limited in 2020, online shopping and consumer reviews became increasingly important. For that reason we are often fielding questions from clients about using consumer reviews in advertising. The quick take from the conference is that advertisers should be careful about filtering or reordering reviews on their own sites. Original Content – How are media companies creating and promoting original content during the pandemic? In-house counsel from new and old media discussed. Production of film and television has mostly resumed, but with strict testing and physical distancing protocols. In many cases, studios are also using remote recording or asking talent to step into the role of videographer at home. To promote content, COVID-friendly solutions included sending influencer boxes (with proper posting guidelines, of course), creating virtual concert and art experiences, and drive-in viewings. Bottom line: creative people are finding creative solutions to the pandemic’s challenges. Promotions – Most promotions, sweepstakes, contests, and games have gone virtual, and yes, state laws around promotions still apply in addition to platform rules, so remember to check both to ensure compliance with all applicable laws. Remember the basic tenets of promotion law, which is to remove at least one of the following elements to avoid an illegal lottery: prize, chance, and consideration. Beware that even a giveaway or gift with purchase can potentially create the element of chance if supplies are limited. Product Claims and Labeling – Claim substantiation was a focal point this year, particularly concerning food, beverage, and nutritional supplement labeling, as many warning letters have been sent and lawsuits filed against companies that produce products with claims of mitigating the novel coronavirus and promoting additional health benefits or immunity from a number of ailments. Remember that implied claims are scrutinized along with express claims, so look to the context as well as the wording to make sure that you aren’t communicating anything about the product that is unsubstantiated. CBD and Alcohol Marketing – While the FDA continues to work on regulations governing CBD, uncertainty surrounding the marketing of CBD products remains. FDA has been taking enforcement action against sellers of products containing CBD making health, drug and/or false claims. However, it is generally tolerating sales of CBD products, such as tinctures, gummies and dietary supplements, where no such claims are being made, even if the products are technically unlawful under the Food, Drug and Cosmetic Act. In actions involving CBD product claims, courts are making inconsistent rulings on whether to stay those actions until the FDA’s regulations are issued. On the alcohol side, the impact of the pandemic on longstanding ways of doing business may end up having a beneficial effect in causing a reconsideration of the archaic U.S. regulatory structure for the sale and marketing of alcoholic beverages (i.e., the current three tier system of producers/distributors/retailers) as well as standards for the advertisement and marketing of alcoholic beverages. Looking Ahead to 2021 – Aren’t we all?! In 2021, we can expect that the FTC will be releasing an updated version of its Endorsement Guides to address the changes (especially in social media) since the last version released in 2009. Will we see aggressive enforcement following the release of the updated guides? Maybe, but it is clear that the FTC and other regulators are expanding their enforcement focus beyond just advertisers to others in the chain, such as influencers, ad agencies, PR agencies, publishers and even retailers. The NAD is also looking ahead to 2021 and we can likely expect to see NAD-initiated actions in new industries – potentially consumer electronics or appliances and other areas that we don’t often see in competitor challenges at the NAD. We hope to see everyone in person on November 15, 2021 in San Diego!

In a precedential decision earlier this year, the Trademark Trial and Appeal Board thinned some of the haze surrounding the registrability of trademarks for hemp-derived CBD products. In line with the U.S. Patent and Trademark Office guidelines issued last year, the Board confirmed that marks covering food and dietary supplements containing hemp-derived CBD are not currently registrable. The decision involved an application for the mark CW covering “hemp oil extracts sold as an integral component of dietary and nutritional supplements” owned by the company behind the “Charlotte’s Web” strain of cannabis, which some may recognize due to national news coverage of its efficacy in treating seizure disorders. The record contained evidence that the applicant sold versions of the goods containing both CBD derived from marijuana (defined as cannabis containing more than 0.3% THC and which is illegal under the Controlled Substance Act (“CSA”)) and from hemp (defined as cannabis containing less than 0.3% THC and which is no longer illegal under the CSA). This dual use prompted the examining attorney to refuse the application on the ground the goods cannot be used lawfully in interstate commerce because they constitute foods that are per se illegal under the federal Food Drug and Cosmetics Act (“FDCA”) and on the ground that the goods are illegal under the CSA. Eschewing the CSA, the Board focused its review on the legality of the goods under the FDCA. Consistent with FDA guidelines, the Board concluded that the CBD oil sold by the applicant qualifies as a food that is subject to the FDCA. The Board further concluded that the CBD oil cannot be a lawful food or dietary supplement under the FDCA because CBD is an active ingredient in the drug Epidiolex, and the FDA’s general rule is that a biologic (such as CBD) cannot be marketed as food or a dietary supplement if the biologic is part of a clinical investigation. In response, the applicant attempted to invoke an exception to the FDCA by arguing that CBD was marketed as a food/dietary supplement before these clinical investigations were underway. The Board rejected this argument on the ground the evidence submitted, which consisted of conclusory statements from the Hemp Industries Association supporting the position, were self-serving and not probative. The decision is also notable for what it does not say. Specifically, the Board did not outright reject the legality of the mark on the ground it is used with goods deemed unlawful under the CSA, which would have been a much easier needle to thread given the applicant’s use of the mark with marijuana byproducts. This tends to confirm that unlawful use of a mark with one type of product does not necessarily prohibit registration of a mark with another lawful product. Additionally, the Board did not completely foreclose the possibility of registering marks for hemp-derived CBD in connection with foods or dietary supplements. To the extent there exists evidence that supports invoking the FDCA’s exception based on marketing of CBD prior to clinical trials, registration may be achievable. And the FDA could always change course in how it treats CBD products. Indeed, organizations such as the National Industrial Hemp Council have submitted comments urging the FDA to consider CBD as “generally recognized as safe” for consumption. If the FDA were to take this approach, it would almost certainly clear the path for federal registration of marks for food and dietary supplements containing CBD. We’ll continue to monitor the FDA’s treatment of CBD products and any impact it might have on the registrability of marks in this space.

A federal district court has eliminated a cannabis company’s affirmative defense to federal trademark infringement claims based on the company’s prior use of a trademark that was legal under state law but not federal law. The Court concluded that, although use of the mark may have been legal under California law, “[c]annabis is illegal under federal law [and] the Lanham Act preempts the state law.” As the TMCA discussed previously, Kiva Health Brands (a national health food and supplements company) and Kiva Brands (a company selling cannabis-infused edibles) are locked in a dispute over the trademark KIVA. The parties cross-filed motions for summary judgment in late 2019 related to Kiva Brands’ various affirmative defenses to Kiva Health Brands’ infringement claim, including defenses based on prior use, laches, acquiescence, waiver, and estoppel. The Northern District Court of California ruled on the motions last Friday, eliminating Kiva Brands’ prior use defense but preserving its other equitable defenses. With respect to the prior use defense, the Court looked to its previous rulings in the case and reiterated that “while [Kiva Brands’] product is legal under California law, its illegality under federal law means that [Kiva Brands] cannot have trademark priority.” The opposite conclusion, it reasoned, would “put the government in the anomalous position of extending the benefits of trademark protection to a seller based upon actions the seller took in violation of that government’s own laws.” The Court rejected Kiva Brands’ argument that Section 1065 of the Lanham Act requires consideration of state trademark rights. This section applies only when a plaintiff has asserted incontestable trademark rights, on which Kiva Health Brands does not rely. The Court went a step further, indicating that even if it were required to consider state trademark rights under the Lanham Act, a federally-illegal use of a trademark simply cannot “support a prior use defense to a federal trademark” and any state law that would allow Kiva Brands to obtain common law (unregistered) trademarks rights would encroach upon and are thus preempted by Kiva Health Brands’ federal trademark rights. Notably, Kiva Brands’ counterclaim based on its common law rights under California law is still pending. However, the preemption aspect of this decision certainly leaves questions about the viability of that counterclaim. The TMCA will continue to monitor the progress of this case, which continues to provide helpful insights into trademark disputes involving cannabis, especially the potential limitations of common law trademark rights for such products.

A dispute over the trademark KIVA involving use of the mark with health food and cannabis continues to smolder in the Northern District of California. In late 2018, Kiva Health Brands (a national health food and supplements company) sued Kiva Brands (a company selling cannabis-infused edibles in California) under federal and state trademark law. Kiva Brands answered with a number of affirmative defenses (including prior use of the mark and laches) and its own federal and state trademark claims based on alleged prior use of the KIVA mark in California. In late 2019, the Court granted Kiva Health Brands’ motion to dismiss Kiva Brands’ federal trademark counterclaims. It ruled that Kiva Brands cannot assert federal trademark rights (even unregistered rights) because Kiva Brands sells federally illegal products and unlawful use cannot form the basis of a valid federal trademark claim. The parties both moved for summary judgment in late 2019 related to Kiva Brands’ various affirmative defenses and recently filed response briefs on January 3, 2020. Kiva Health Brands argues it should prevail against Kiva Brands’ prior-use affirmative defense given the Court’s prior ruling that Kiva Brands cannot offensively assert any federal trademark rights. Kiva Health Brands claims that, “where a mark is used for cannabis products, the [federal trademark law] does not recognize those ‘rights’ for a federal registration or for any other purpose.” It also contends that any state trademark rights held by Kiva Brands would be preempted by Kiva Health Brands’ federally registered rights - although Kiva Health Brands still has not sought dismissal or summary judgment on Kiva Brands’ state trademark claims. For its part, Kiva Brands requests summary judgment on its laches defense, asserting that Kiva Health Brands unreasonably delayed in filing suit, which resulted in significant prejudice to Kiva Brands. Kiva Brands claims that, under pertinent case law, Kiva Health Brands had only two or three years to bring its claim, while Kiva Health Brands claims it had at least four years and filed within that window. Dorsey will continue to monitor the progress of this case, which has provided helpful insights into trademark disputes involving cannabis, especially the potential limitations of common law trademark rights for such products.

On November 25, 2019, the Food and Drug Administration sent a wave of warning letters to fifteen CBD companies claiming they are breaking federal food, drug, and cosmetic laws based on their current CBD product marketing and labelling. Prior to this, the FDA had separately sent letters to seven other CBD companies in 2019 and to only one CBD company in 2018. A comprehensive list of CBD-related warning letters sent by the FDA can be found here. The FDA accompanies the most recent letters with a press release and a revised Consumer Update discussing the FDA’s potential concerns about CBD. As in the past, these letters targeted companies marketing CBD products to treat diseases or claiming that CBD has therapeutic uses for humans and/or animals. The letters also target companies that market CBD products as dietary supplements or as an additive to human and animal foods. At their most basic, the FDA’s objections are rooted in the agency’s interpretation of the Food, Drug, and Cosmetic Act (“FDCA”), which the FDA claims precludes CBD from being classified as a dietary supplement because CBD is also an active ingredient in the drug Epidiolex. The FDA also takes the position that, under the FDCA, CBD products could be viewed as new, unproven drugs where a company promotes use of CBD for curing and treating diseases and ailments. Despite the FDA’s fairly aggressive position and action in issuing the warning letters, the FDA’s press release indicates that it continues to “explore potential pathways for various types of CBD products to be lawfully marketed.” The FDA plans to provide an update on its progress regarding the agency’s approach to these products “in the coming weeks.” As of the time of writing this post, the FDA has not issued a further update. However, these statements still show signs of a potential reversal or at least softening of the FDA’s treatment of CBD. So, what lessons can CBD companies learn from these letters in hopes of avoiding the ire of the FDA? First, just because a company did not receive a letter from the FDA, that does not necessarily mean it is in compliance with the FDA’s current interpretation of the FDCA or that it won’t receive a letter in the future. The FDA has a limited enforcement budget and appears to continue to target offenders making extreme performance claims about CBD. Second, making statements about perceived health/wellness benefits of CBD products is a major no-no. And this doesn’t just apply to obviously extreme claims, such as stating that CBD may cure cancer. It also applies to less extreme statements about CBD performance, such as claiming that CBD products help with “skin rejuvenation” or “joint & muscle relief” or referring to CBD products as “dietary supplements” or food. Companies would be well served by implementing multi-level review processes (including external review where feasible) to ensure marketing materials, packaging, and websites do not fall on the wrong side of this line, at least until the FDA issues further and more specific guidance. Dorsey will continue to monitor the FDA’s actions and updates in this area.

And the new top level domain names just keep on coming. As our readers may know, ICANN, the organization that operates the internet domain name system, authorized the launch of the New gTLD Program – the largest expansion of the generic top-level domain name (“gTLD”) system on the Internet in history. Prior to the launch of this program only 22 gTLDs had been approved and added to the Internet (e.g. .com, .net, .org). Now, you can obtain specialized domain names, such as .bank, .weather, or even .rugby. Now .music has been approved for launch for the purpose of serving the global music community. An entity named DotMusic Limited beat out Google, Amazon, and other interested groups for the right to operate the .music registry. DotMusic states that it will verify registrants to ensure that only the rightful owner of a name can obtain a corresponding domain name. DotMusic further promises safeguards to protect against both trademark and copyright infringement, including investigation practices, penalties, and takedown procedures. To register a .music domain name, registrants must (1) belong to a music community membership organization (“MCMO”) and (2) meet clear membership criteria demonstrating “requisite awareness and recognition of their community.” MCMOs, according to DotMusic, constitute “a majority of all global music entities involved in the legal production, distribution and promotion of music,” and we assume therefore include performing rights organizations, such as ASCAP and BMI, as well as music publishers and record companies. As far as we can tell, the membership criteria has yet to be defined, but we assume most musicians belonging to an accredited MCMO will qualify. If you are interested in a .music domain name and not already a member of an MCMO, now is the time to consider joining one. .music domain names can only be registered if they are: the entire or portion of the applicant’s name; an acronym representing the applicant; a name that recognizes or generally describes the applicant; or a name related to the applicant’s mission or activities. Once launched in 2020, .music domain names will be available to verified members in the following order: (1) sunrise, (2) MCMO members, and (3) general availability. .music will use a Globally Protected Marks List (link here). Registration in the sunrise period will be open to brands and trademarks in the Trademark Clearinghouse (“TMCH”). A TMCH registration entitles trademark owners to pre-register domain names corresponding to their registered marks, typically for a premium price. We will keep our readers updated as more details emerge on the membership requirements and registration process. In the meantime, interested musicians might consider seeking registration of their trademarks in the TMCH to ensure early access to their .music domain name of choice.

If you missed the 2019 Annual Meeting of the International Trademark Association in Boston, or if you were there but were spending time with colleagues and friends, the Dorsey trademark team is here to provide a brief overview of some interesting seminars we attended and tidbits scooped up during the Meeting: Fictional Characters:  Dorsey’s very own Jeff Cadwell (Minneapolis office) kicked things off for a packed room on Saturday by moderating a session called “Character Wars.”  The panel focused on the intersections of trademark and copyright law relating to the protection of fictional characters.  Jeff was joined by panelists Michael Lovitz, Chantal Koller, and Christopher Smith, who spoke about US law, European and Swiss law, and Chinese law, respectively.  The panel explored options for registration of rights, what sort of unregistered protection may exist, enforcement tools, and merchandising considerations. Trademark Investigations:  With participants from the United States, China, Europe, and Mexico, this panel addressed the ethical contours of trademark investigations in various countries around the world.  These types of investigations can be a crucial component for both enforcement and prosecution efforts and require special ethical considerations that vary depending on the jurisdiction. For example, in the United States, evidence gathered illegally or unethically by an investigator can render the evidence inadmissible in a contested proceeding.  Additionally, evidence gathered by an attorney might also be inadmissible due to ethical conflicts with an attorney acting as a fact witness.  In China, evidence needs to be notarized to be admissible; notarization in China can be extremely expensive.  Accordingly, in situations where a party is considering petitioning to cancel a registration for non-use in China, it can sometimes be less expensive to simply file the proceeding and see what happens rather than conduct a formal investigation to gather admissible evidence.  Unlike in the United States, in Europe, attorneys are generally not prohibited from presenting evidence they have collected.  In Mexico, a court will accept an investigation report, but will independently confirm the facts presented therein. With so many considerations at play, it behooves brand owners and trademark attorneys to consult with local counsel prior to conducting an investigation outside of their home jurisdiction. Blockchain:  Chances are that you’ve heard the buzzword “blockhain” sometime in the past two years.  Whether it be in the context of Bitcoin’s meteoric rise (and subsequent fall) or in the many other tech products based on the concept.  This session discussed the potential solutions blockchain may offer to IP attorneys and consumer brands.  “Blockchain” is a distributed ledged technology that houses a record of transactions on computers linked across a peer-to-peer network. In the context of the IP world, blockchain has numerous potential applications, including: Supply chain shipment tracking for anti-counterfeiting efforts (i.e., the ability track and verify the shipment of original products) Brand messaging (i.e., ability to verify where and from whom a message originated) Copyright royalty administration (i.e., more accurate accounting of number of plays of a given copyrighted song for mechanical royalties) Verification and housing of trademark registers (i.e., instant access to a verifiable ledger of trademark registrations) With all of the potential uses of blockchain, major intellectual property organizations are paying attention.  For example, the World Intellectual Property Organization (WIPO) has created a task force to investigate possible uses of blockchain for creating a distributed IP registry.  In fact, WIPO held a workshop in April 2019 focused on potential uses of blockchain. While the future of cryptocurrencies may be uncertain, it is clear that the underlying blockchain technology will continue to reverberate in the tech world and, it appears, in the legal community. Artificial Intelligence (“AI”):  AI was also a hot topic at INTA, with many speculating as to how to solve common trademark law problems with AI as the technology evolves and develops.  We learned that AI already exists to help identify key and missing terms in certain contracts, but we are only on the cusp of what AI can accomplish for more particular trademark tasks, such as searching and clearance or for determining likelihood of confusion based on consumer impressions.  As it turns out, trademark law remains heavily dependent upon human perceptions.  AI can also be cost prohibitive for most firms and businesses, and reliance upon AI for providing legal opinions can impose its own set of risks.  Nevertheless, AI has arrived and those who can utilize it to their benefit now will be ahead of the competition. Updates from the USPTO and TTAB:  USPTO leadership held a transparent session on new updates—all aimed to make the Office more efficient and streamline processes.  All practitioners will eventually need a USPTO.gov account, so log into your MyUSPTO account and make sure to keep it updated.  We also learned that opposition and cancellation proceedings before the TTAB have increased over 10%, and that more practitioners are taking advantage of accelerated case resolution.  Meanwhile, the chances of a successful TTAB appeal remain slim:  Likelihood of affirmance of a Section 2(d) likelihood of confusion refusal was about 91% for calendar year 2018, and likelihood of affirmance of a Section 2(e)(1) mere descriptiveness refusal was about 90% for 2018—both figures slightly higher than for 2017. Hot Trademark Cases:  Trademark law remains as exciting as ever.  Perhaps the hottest trademark case of the year was the most unmentionable (In re Brunetti). On the heels of “The Slants” case, the Supreme Court's upcoming decision about the fate of the FUCT trademark promises to give us all plenty to talk about concerning indecent or scandalous marks.  The other hot trademark law decision, Mission Product Holdings, Inc. v. Tempnology, LLC, issued the week of INTA. At last, we can be sure that trademark licensees rejected by bankruptcy debtors may continue to use licensed trademarks. We hope to see you in Singapore in 2020!

The United States Patent and Trademark Office will now allow federal trademark registration for marks used on some hemp-based products, including those containing hemp-derived CBD, except for foods, beverages, dietary supplements, or pet treats. On May 2, 2019, the USPTO issued Examination Guide 1-19 for the examination of federal trademark applications covering cannabis and cannabis-derived goods and services. The guide comes in the wake of the December 20, 2018 Farm Bill, which among other things, explicitly removed hemp (a type of cannabis) and its byproducts from the definition of “Marihuana” in the Controlled Substances Act and broadened the pilot program to allow for more widespread non-academic cultivation of hemp. The Farm Bill created tension with the USPTO’s longstanding practice of outright denying or, in the case of CBD products, sometimes postponing the examination of, any application with a whiff of cannabis on the ground the goods or services cannot be used lawfully in commerce (which is a requirement for federal registration). The brand new Examination Guide acknowledges that marks used on hemp products (including CBD) produced lawfully under a state pilot program, which controls the means by which hemp may be grown and processed within a given state, are not illegal under the Controlled Substances Act and so should also be registrable. But the Guide identifies another potential ground for refusing hemp-based CBD products as unlawful based on guidance from the FDA. The Farm Bill explicitly preserved the FDA’s authority to regulate certain types of products containing cannabis and cannabis-related compounds. The FDA has indicated that it believes the sale of foods, beverages, dietary supplements, or pet treats containing CBD (regardless of how derived) to be illegal under the Federal Food, Drug and Cosmetic Act (click here). Thus, based on the FDA’s statements, the USPTO has indicated that it will not allow registration of foods, beverages, dietary supplements, or pet treats containing hemp-derived CBD on the ground they cannot be lawfully used in commerce, unless or until the FDA’s position changes. Importantly, the USPTO has indicated that its guide applies only to applications filed after the passage of the Farm Bill on December 20, 2018. For applications filed on or before December 20, applicants can amend their filing date to December 20, 2018, based on the USPTO’s view that applicants could not have legally sold or had a good faith intent to legally sell any CBD or cannabis-derived product prior to the passage of the Farm Bill. This change in USPTO policy opens up new potential registration opportunities for cannabis brands. For example, smokable products are conspicuously absent from the USPTO’s list of prohibited CBD goods. Thus, companies selling smokable hemp-derived CBD products may have a good case for federal registration. Additionally, for cannabis brands selling products derived from both hemp and marijuana, it potentially presents an opportunity to obtain federal registration for the federally-legal components of their businesses. Although the FDA currently maintains it is illegal to sell foods, beverages, dietary supplements, or pet treats containing CBD, it is taking steps that could indicate a change to its approach. The FDA is holding a public hearing on May 31 for stakeholders in the cannabis industry and is forming a high-level working group to explore pathways for legally selling and marketing food and dietary supplements containing cannabis, including hemp-derived CBD. If and when the FDA changes its approach for these products, this could open the door for widespread federal registration of hemp-based CBD products.

American Airlines recently scored a major win by convincing the Copyright Office to reverse its refusal of an application to register the “American Airlines Flight Symbol.” American Airlines reached its final destination after overcoming myriad delays.  The Copyright Office rejected American Airlines’ copyright application three times on the ground it did not contain a sufficient amount of original and creative artistic or graphic authorship to support a copyright registration.  According to the Copyright Office, it receives half a million applications annually, but only declines to register less than 20,000 on this basis.  First, a Copyright Office Registration Specialist refused registration; second, an Attorney-Advisor for the Copyright Office denied American Airlines’ First Request for Reconsideration; and third, the Copyright Office Review Board denied American Airlines’ Second Request for Reconsideration.  In fact, the Review Board noted that “the Work falls just below the threshold for creativity required by the Copyright Act.”  With no other options left, American Airlines filed a lawsuit seeking judicial review of the decision under the Administrative Procedures Act (“APA”).  The complaint referenced widespread disapproval of the decision amongst copyright practitioners, including an informal poll during a June 2018 meeting of the Copyright Society of the USA.  In a presentation by Karyn Temple, the Acting Register of Copyrights, she asked an audience whether anyone agreed with the refusal.  Apparently, no one raised their hand and then, according to the complaint, Ms. Temple conceded, “I think the main drafter of that one actually even kind of regrets that decision.”  Only one month after it filed the complaint, American Airlines dismissed the suit, reporting that the Copyright Office had agreed to again review its refusal of the work. After conducting an additional review of the design, the Copyright Office has now reversed its three prior refusals of the application finding that the work does indeed contain the requisite level of creativity.  So, why the change?  The decision purportedly hinges on American Airlines’ submission of a higher-quality image of the work showing “additional detail that had not been clear from the original deposits.”  With this new version of the design, the Copyright Office Review Board found a number of elements showing sufficient creativity, including an “aircraft tail element [that] is oriented on an angle,” a “bird-head element [that] hovers just below the center of the aircraft tail element” with a “three-dimensional appearance that causes the bird-head element to appear to be above and separated from the aircraft tail,” and multiple colors with different gradients and shading “further heightening the illusion of depth.”  Notably, the Board limited American Airlines’ level of protection by stating that “the resulting protection is thin, protecting only the Work’s original and creative elements ‘against only virtually identical copying.’”  Interestingly, at least to our eyes, the original deposit copy of the work is not all that different than the higher-quality version that apparently swayed the Copyright Office.  The shading, gradients, and bird-head elements are all visible. The Board also took pains to indicate that “there are no third requests for reconsideration,” despite the upgrade it afforded American Airlines.  It also stressed that all decisions by the Copyright Office are made on a case-by-case basis and other applicants should not expect the Board to conduct such additional screening when applications are rejected. So what can your brand learn from this victory in the sky? Submit the highest quality images you have when applying to register logos with the Copyright Office. When you have a two-dimensional logo that contains shading and features that give the work depth, make sure to point that out on a First Request for Reconsideration. If your logo consists of a combination of geometric shapes and suggestive elements that may not be readily discernable, explain those elements to the Copyright Office in a First Request for Reconsideration. While the Copyright Office claims, that “the symbolic meaning or impression that a work conveys is irrelevant to whether a Work contains a sufficient amount of creativity,” this decision suggests otherwise. The Copyright Office is not interested in a work’s public reception or the author’s intent, so don’t expend resources providing evidence of these points to the Office. In the decision, the Copyright Office also included a reminder that “the Office does not consider the time and effort used in creating a design, its novelty, aesthetic appeal, or commercial value.” It remains to be seen if others will try to leverage similar outcomes by seeking review under the APA, especially in light of what appears to be a recent trend of the Copyright Office refusing company logos on the ground they lack creativity.  In the meantime, American Airlines will be sipping champagne in first class by itself.

If you have encountered any issues accessing WHOIS information, the International Trademark Association (“INTA”) wants to hear from you. Due to changes in privacy law brought on by the European Union’s General Data Protection Regulation (“GDPR”), it is becoming more difficult or impossible to access once-commonly available public WHOIS information, which consists of registrant information for domain names. We have written on this topic in more detail here and here. Here’s the short story: because providing WHOIS information risks violating GDPR, which could result in the imposition of potentially catastrophic fines, some domain name registrars are opting not to provide WHOIS information, despite requirements by the Internet Corporation for Assigned Names (“ICANN”) that registrars provide the information. As a result, it is becoming more difficult for rights holders to identify and take action against owners of domain names containing infringing materials. To help track and catalogue these issues, INTA has created a dedicated email account at whoischallenges@inta.org. Those encountering WHOIS problems are encouraged to send the following information to INTA: Where the problem is occurring (country, location, or jurisdiction). What the nature of the problem or case is (a procedure, a piece of evidence, or a venue). Anonymous descriptions of the actors or people involved (provide industry and/or non-specific information about the actors involved). INTA plans to use this information as part of its advocacy efforts. So if you have encountered any issues, be sure to alert INTA. It is worth noting that it is still possible to file arbitration proceedings against infringing domain names, using the Uniform Domain Name Dispute Resolution Policy (“UDRP”) or Uniform Rapid Suspension System (“URS”), even if the WHOIS information for the domain names is not available. According to the World Intellectual Property Organization (“WIPO”), a complainant should simply list the registrant information exactly as it appears in the WHOIS report, even if that information consists only of the word “Redacted.” Once alerted of a UDRP or URS proceeding, ICANN-compliant registrars are required to give the arbitration provider the full, unmasked registration data for the domain name(s) covered by the complaint. The complainant typically would receive this information and then, if necessary, may amend or withdraw its complaint based on the information revealed.

If you didn’t make it to the 2018 Annual Meeting of the International Trademark Association in Seattle, or if you were there but were out enjoying the spectacular weather or spending time with colleagues and friends, the Dorsey trademark team is here to provide  a brief overview of some interesting seminars we attended and tidbits scooped up during the Meeting: Federal Registrations for Cannabis: In a lively debate, panelists Shabnam Malek (an attorney in the cannabis industry) and Robert A. Mikos (a professor at Vanderbilt Law School) discussed whether the U.S. Patent and Trademark Office should grant federal trademark registrations for cannabis brands.  The PTO’s current position is that federal registrations may not be granted for substances or activities illegal under federal law because they cannot be used lawfully in commerce.  In favor of federal registration, Malek contended that the wording “lawful use in commerce” in the federal trademark law is at least ambiguous and that, under the Administrative Procedures Act, the PTO should exercise its power to interpret the wording to encompass use that is lawful under state law, namely, the sale of cannabis.  She also contends that consumers face serious risks if the same brand is operating in multiple states with different products.  For example, a product with a smaller dosage sold in one state could be sold under the same name in another state with a higher dosage, thereby subjecting consumers to potentially dangerous, or at least different, effects than anticipated.Malek countered that the federal law is not ambiguous and clearly prohibits registration of cannabis while the current state-based system offers enough protection for brands and consumers.  Brands may obtain state trademark registrations where cannabis is legal and labelling requirements in states ensure that consumers understand what is in the product they are purchasing.  Additionally, he worried that granting cannabis registrations would open the door to registrations for other types of federally illegal drugs, such as meth.After a final poll of the room, it was clear that most in the audience favored granting federal registrations for cannabis.  This debate will most certainly continue as more and more states allow the sale of cannabis for medical and recreational purposes and the global market for cannabis, which is expected to hit $57 billion by 2027 according to Forbes, continues to boom.  The TMCA has written on this topic and will continue to follow developments in this industry. Product Placement: While product placement is often thought of as a static one-time and one-brand opportunity (think Reese’s Pieces in E.T.), panelists discussed the ways in which technology has paved the way for new and exciting opportunities.  Using retroactive product placement, it is now possible to seamlessly insert new products into already-existing content.  For example, an older movie poster in the show “How I Met Your Mother” can be digitally altered so that reruns now feature a poster for a 2018 release.  A show or movie can feature different types of cars in otherwise identical scenes in different markets.Social media influencers also remain a top priority for many consumer-facing brands.  Panelists cited statistics estimating that each $1 spent on social media marketing yields approximately $6 in revenue.  And nearly 60% of YouTube subscribers watch an influencer video before making purchases.  The TMCA has posted numerous times on developments in the landscape of influencer advertising. Food For Thought: In a seminar featuring in-house counsel from Amazon, Walmart, General Mills, Restaurant Brands International, and Jelly Belly, some of the largest players in the food industry discussed the challenges of food branding.  One theme for all companies was ensuring consistency of branding across many platforms, especially mobile devices.  Companies need to ensure that branding translates to the smaller screens many consumers are now using to interface with their brands.  In connection with this consistency, the companies discussed the concept of website trade dress and the extent to which the look of a company’s site is entitled to trademark protection.  The short answer: the more distinctive and consistent the better.Another point of concern expressed both by panelists and attendees is their interaction with third-party delivery platforms (e., GrubHub, DoorDash, etc.) and food boxes (i.e., Blue Apron, Plated, etc.) and to what extent these platforms may use a company’s trademark.  Regardless of fair use considerations, most panelists agreed that, at a minimum, contractual control is a crucial component to ensure brand owners have some way to control or limit the way delivery companies use their marks.  This enables companies to retain control over their brands and also ensures that consumers understand the relationship between the parties so that they can appropriately assign expectations (and blame, if necessary). Morality Clauses: In several seminars, panelists reiterated the importance of brand owners including morality clauses in agreements with licensees or promoters. This facilitates a swift exit should a brand wish to sever ties after an embarrassing, illegal, or scandalous action turning public opinion against the licensee or promoter.  With increased scrutiny now facing brands that support individuals or companies falling out of public favor, it is important to have this type of contractual ripcord. The Slants: Rock Stars of the Trademark World and Beyond: Dorsey was proud to present at its reception the talented and U.S. Supreme Court precedent-establishing band The Slants – if you missed their performance, check out their website. We look forward to seeing what happens at next year’s Annual Meeting in Boston (May 18 – 22, 2019) – see you then!

Domain name registrars and registries might soon be changing their mantra from, “I think ICANN,” to, “Maybe ICANN’T,” when it comes to providing publicly available WHOIS information for domain name registrants.  New potential models for WHOIS will be posted January 15, 2018, and attempts to salvage at least most of the existing WHOIS system are underway. ICANN, the Internet Corporation for Assigned Names and Numbers, is an international nonprofit organization responsible for creating and maintaining rules related to domain names.  Among other things, ICANN contractually requires accredited domain name registrars (companies selling domain names to the public) and certain domain name registries (companies that manage domain name extensions) to maintain a free, publicly available WHOIS database from which anyone may obtain basic contact and technical information about domain name registrants.  This data includes information like the domain name registrants’ names, addresses, email addresses, and phone numbers.  Registrars that fail to comply with these requirements are in breach of their agreement and risk losing ICANN accreditation. But registrars and registries now find themselves between a rock and hard place when it comes to providing required WHOIS data in light of changes to EU privacy law under the General Data Protection Regulation (“GDPR”), which become effective on May 25, 2018.  We have written previously about the GDPR in other contexts here and here. In a nutshell, the GDPR imposes duties on companies based in the EU or offering goods and services to EU residents requiring these companies to protect all data that relates to a living individual, even where that data is publicly available or voluntarily submitted by the individual.  EU residents also have various rights, including the right to object (opt-out) and the right to be forgotten (erasure/data cleansing).  Consent to use data cannot be folded into online terms and conditions (like those agreed to during the registration of most domain names) and it may be withdrawn.  Companies that fail to comply with the GDPR may face enormous fines of up to €20 million or 4% of global annual revenue, whichever is greater.  Because much of the information available in WHOIS databases is governed by the GDPR (when it relates to EU registrants), these organizations are concerned about their ability to comply both with ICANN’s contractual requirements for public disclosure of personal WHOIS data and the GDPR’s data protection requirements.  Given the massive fines at stake under the GDPR, it is not surprising that many are opting to shirk ICANN’s WHOIS requirements as they prepare for the GDPR’s implementation. For its part, ICANN has acknowledged the conflict and has created a Protection/Privacy Issues webpage with updates on its consideration of the issue.  ICANN received a letter from the EU’s Article 29 Working Party in December saying that the current WHOIS system does not comply with the GDPR and the goals of WHOIS may be met by developing a system of layered access in which different users receive access to different sets of data. For the time being, ICANN is investigating options and has stated and that it will defer taking action for noncompliance with its WHOIS requirements if registries and registrars share their models for complying with the GDPR, their analysis of how each model complies with the GDPR and ICANN obligations, and a description of how the disclosed model does not simply abandon all WHOIS obligations.  It has asked for models to be submitted by January 10, 2018, and plans to post the models on January 15, 2018.  These submitted models are being evaluated by an outside law firm, which will present a number of options to ICANN, presumably so that it may either adjust its WHOIS policies or provide guidance to registrars and registries on how to comply with both the GDPR and WHOIS obligations. In its latest memo to ICANN (December 21, 2017), the outside law firm describes how layered access to WHOIS would significantly increase the cost and burden on registrars who are not in a good position to assess legally who should receive which type of access to WHOIS.  It recommends that layered access be considered as a temporary solution only.  It suggests that ICANN negotiate with EU regulators to allow the current WHOIS system to continue to exist long-term, with the same information publicly available (except for email addresses, which it deems unnecessary for enforcement activities).  It notes that similar information is currently publicly available in trademark registers. In the meantime, this conflict is likely to have a negative impact on the ability of brand owners to enforce their rights against domain name squatters and infringers.  If registries and registrars are unwilling to provide WHOIS data, it will be more difficult to ascertain the identities and contact information for infringers, either for purposes of sending demand letters or establishing patterns of abuse.  It could also make it difficult to file complaints under the Uniform Dispute Resolution Policy (“UDRP”), which requires that a complainant list the contact information for a domain registrant as it appears in the WHOIS database.  If the WHOIS information is not available, it is unclear what information, if any, a complainant would be required to include in the complaint to ensure it is complete and whether an arbitrator or registrar reviewing the complaint could refuse to act based on a lack of information.  Even if WHOIS information is available under a new, layered access system, the increased effort required to obtain ownership information will likely increase enforcement costs for brand owners. For now, it appears that ICANN is serious about trying to resolve the issue.  We will keep our readers updated on changes to this developing situation.

You might want to think twice before registering a domain name containing a competitor’s personal name or trademark.  Three-time Tour de France winner Greg LeMond put his “pedal to the metal” recently, suing two Minnesota businessmen under the Anticybersquatting Consumer Protection Act (“ACPA”). LeMond is seeking $6.6 million in damages and a permanent injunction for their alleged registration of 66 domain names containing LeMond’s name and the name of his carbon-fiber business, Grail. The complaint is here.  LeMond alleges that the duo registered the domains in bad faith by seeking to profit from their sale and from third-party advertisements posted on the domains’ websites.  In a letter to the court, one of the defendants is seeking to exit the race early, claiming to be a victim of an unknown identity thief that is actually responsible for registering the domains. As LeMond apparently knows, the ACPA is a powerful lever for trademark owners.  A plaintiff may seek statutory damages of $1,000 to $100,000 per domain name (hence the $6.6 million in requested damages) and injunctive relief to force transfer of the domain names.  Statutory damages are an especially powerful tool because they are awarded based purely on a violation of the ACPA and do not require additional proof of the actual value of the harm caused by the violation.  Courts may also treble actual damages, if proven, and award attorney’s fees in exceptional cases.  A defendant may therefore face significant road rash if it falters in its defense of an ACPA claim. Trademark owners sometimes seek other types of relief when faced with cybersquatters, such as initiating UDRP or URS domain name arbitration proceedings.  These are relatively low-cost options and, if successful, result in the transfer or suspension of the infringing domain.  However, unlike an ACPA claim, a trademark owner cannot seek damages or an injunction in a UDRP or URS proceeding.  The stakes are much higher for a cybersquatter in an ACPA action. This case also shows the value of proactively registering important domain names prior to filing new trademark applications or publicly announcing a new brand.  Once a trademark application is filed, the information it contains is accessible on the U.S. Patent and Trademark Office website.  Unscrupulous third parties sometimes troll new trademark filings to register corresponding domain names in hopes of selling the domains to the mark owner or generating advertising revenue.  Establishing and abiding by a domain name registration policy can help to decrease the likelihood of needing to deal with cybersquatters.

We recently provided some commentary on Gene Simmons and his application to register the “devil horns” rock and roll hand symbol.  Well, you can now KISS that application goodbye, as Mr. Simmons has expressly abandoned his federal trademark application.  No details on the reason for the abandonment were included in the filing with the USPTO, nor does it appear Mr. Simmons has made any public comment on the application. Now rockers everywhere can breathe a sigh of relief that they will be able to sport their devil horns without Mr. Simmons telling them to kiss off.

On June 9, 2017, Gene Simmons of Kiss rock band fame applied with the United States Patent and Trademark Office (“PTO”) to register the following mark for “Entertainment, namely, live performances by a musical artist; personal appearances by a musical artist” in Class 41:         Simmons describes the mark thusly: “The mark consists of a hand gesture with the index and small fingers extended upward and the thumb extended perpendicular.” Simmons claims to have first used the mark anywhere and in interstate commerce at least as early as November 14, 1974, which, according to Wikipedia, was the year of Kiss’ first major tour.  As his evidence of use, he submitted a photo of himself displaying the sign while standing next to Dave Grohl of Nirvana and Foo Fighters fame. This hand gesture, often referred to as some variation of “devil horns,” has become synonymous with rock and roll, although people certainly disagree about whether the thumb should be extended (authors’ opinion: it shouldn’t be).  Unsurprisingly, a quick internet search will reveal dozens of musicians using this hand gesture, with or without the thumb extended, including Metallica, Dave Navarro, and even John Lennon on the cover of the Beatles 1966 single for “Yellow Submarine,” which predates Simmons’ claimed first use.  Even politicians have been seen using the symbol, including Bill Clinton, Barrack Obama, and Sarah Palin. The PTO is unlikely to allow this application to Rock and Roll All Nite.  When Simmons filed the application, he had to make a declaration that “To the best of [his] knowledge and belief, no other persons, except, if applicable, concurrent users, have the right to use the mark in commerce.”  The examining attorney will likely take note of the widespread use of the symbol to refuse the application on grounds that Simmons does not control or own exclusive rights to it.  The examining attorney may also refuse to accept the specimen, which does not appear to show the mark in use with entertainment services.  Although Dave Grohl does look pretty entertained… Even if the PTO were to allow registration of the mark, it seems Simmons would have an incredibly difficult time enforcing any rights he might claim in the mark.  He would need to show that consumers are likely to be confused about the source of services when others use the hand gesture.  Essentially, his argument would be that concertgoers would be confused as to whether a musician performing at a concert they are attending is, in fact, Simmons because the musician used the hand gesture.  Outside of a very good Kiss cover band, this seems unlikely.  Perhaps Simmons will employ some of his signature makeup to help him keep a straight face…