Business Transactions and Litigation: The US Supreme Court has ruled that an entity by the 32 NFL teams to handle their logo licensing is not immune from antitrust scrutiny and sent the case back to lower courts to determine the reasonableness of the entity. Regarding the implications of the case on free agency, two quotes can be parsed from the opinion. First, the Court stated that "The teams compete with another ... for contracts with ... playing personnel." Second, the Court reiterated that "We have recognized ... that the interest in maintaining a competitive balance among athletic teams is legitimate." The prediction is that for free agency restrictions to survive, they will have to stand scrutiny of being reasonable to maintain competitive balance of the teams. 

Antitrust Restraints on NFL and Sports (May, 2010)

Patents Term Extension for Regulatory Review (May, 2010)

Business and Patents: Regarding regulatory delay, the Federal Circuit affirmed the District Court of Virginia in requiring the Patent Office to extend the term of a patent covering an active agent that was a modification of previously patented active agent where the FDA required a supplemental NDA on the modified agent which resulted in regulatory delay.

Trademarks and Litigation: After an Act of Congress, justice for Victoria's Secret against Victor's Secret. Victoria Secret brought suit for trademark dilution against a business then called Victor's Secret. The case went all the up to the Supreme Court which held that Victoria Secret had the burden of proving actual dilution. This could not be done. Congress responded by changing the statute to require a likelihood of dilution. During remand proceedings, the Sixth Circuit affirmed a likelihood of dilution. The Sixth Circuit engaged in, or came very close to engaging in judicial legislation and made a pronouncement that: [A]ny mark with a lewd or offensive-to-some sexual association raises a strong inference of tarnishment. The inference must be overcome by evidence that rebuts the probability that some consumers will find the new mark both offensive and harmful to the reputation and favorable symbolism of the famous mark. Most troubling is the double reference to some/some consumers. This lowers the law to the lowest common denominator.

Standard for a Trademark Dilution Claim (May, 2010)

HeLa cells get their name from their source; namely, the body of Henrietta Lacks. Rebecca Skloot has written a book on the foregoing entitled The Immortal Life of Henrietta Lacks. As almost everyone involved in biotechnology knows, the science and industry was built on HeLa cells. According to Skloot, there are more than 60,000 scientific papers that feature HeLa cells. They were even involved in the development of the polio vaccine. Now, a tribute to African Americans and a sounding of the trumpet to provide deserved recognition. Lacks was an African American women. The cells taken from her body were immortalized for scaled-up production by African American scientist at the Tuskegee Institute (Alabama.) The foundation of the American biotechnology industry was laid by African Americans. Now the injustice. Lack was impoverished and the cells were taken from her biopsy without permission and payment of any compensation, according to the book by Skloot. Further, according to Skloot, The descendants of Lack remain impoverished. Skloot has set up a foundation that makes scholarship grants and provides health insurance subsidies to the descendents of Lack. This foundation can be reached at http://rebeccaskloot.com/book-special-features/henerietta-lacks-foundation. What about the California legislature extending the statute of limitations on the conversion of cells so her heirs can sue for compensation?

Life Sciences: HeLa Cell History (May, 2010)

Patent Reform Act of 2010 (May, 2010)

Patents: Commentary on Patent Reform Act of 2010. It uses the buzz word REFORM; but, it really facilitates more hanky panky. The bill eliminates a Best Mode requirement. By definition, eliminating a Best Mode requirement opens the door to a patentee concealing the secret sauce that makes an invention really work. The bill provides for Post Grant Review akin to Europe. The European legal system is very different from the US. In Europe, validity and infringement are typically tried separately. Further, as of date, there is no European wide patent court. So Post Grant Review makes sense in Europe. In the US, none of the foregoing is the case. Post Grant Review will primarily open the door for large enterprise to financially break small enterprise lacking funds to defend a patent. Further, the bill provides a get-out-of- jail-free-card for in equitable conduct. If a patentee suspects that inequitable conduct will be caught, the bill provides for exoneration by requesting re-examination and presenting the concealed information.

Recent Articles

Patents and Litigation:

 

Trademarks and Litigation: Los Angeles Daily Journal Article on Trademark Anti-Dilution Case

 

Los Angeles Daily Journal article on a broker/reseller using in a domain name the trademark of a manufacturer)

Patent Validity Challenges (June, 2010)

Patents and Litigation: In Trimed, Incorporated v. Stryker Corporation, Fed. Cir. Case No. 2009-1423 (June 9,2010), the court held that to invalidate a patent based on logic not in the references, this requires that the judge make findings of fact to substantiate that the logic is known in the art. Recourse to logic, judgment and common sense available to persons of ordinary skill in the art is the bane of any patent attorney defending the validity of a patent.

 

Patents and Litigation: Court of Appeals for the Federal Circuit says NO to a priority claim by a grandchild patent application to a grandparent patent application where the parent patent application does not claim priority to the grandparent application (i.e., its parent.) (see, Encyclopedia of Britannica v. Alpine.)

Shareholder Alter Ego Liability (June, 2010)

Business and Litigation: California Court of Appeals is receptive to shareholder alter ego liability to a creditor based upon ongoing draining of money from the corporation to other businesses owned by shareholder coupled with the shareholder influencing the corporate President (see, Zoran v Chen, Sixth Appellate District, Case No. H034432 (June 15, 2010.)

Business and Litigation: The US Supreme Court declined to make a definitive ruling on whether employees have a privacy interest to texting on a company cell phone. The Court said the employer's guidelines will be key. For the purpose of the case at bar, the Court assumed a privacy expectation. (see, City of Onatario v. Quon.)

Employment Law and Texting (June, 2010)

Intellectual Property: US Government launches an IP enforcement initiative with a 61 page report making 31 strategy recommendations, the assignment of 50 agents from the Federal Bureau of Investigation (FBI) and a review by the Intellectual Property Enforcement Agency of the Office of Management and Budget (OMB) on curbing overseas  infringement. 

US Government IP Enforcement Initiative (June, 2010)

Show your intellectual property (copyrights, trademarks, patents ) power by placing on your website a link to www.IPcounselor.com. Show your litigation and business transaction power by placing on your website a link to www.LAXlaw.com.

Copyright 2010 The IP and Business Law Offices of Howard L. Hoffenberg, Esq. All Rights Reserved.

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Business: Tax Credits/Grants to Biotech (June and July, 2010)

Nature Magazine reports that the healthcare reform law includes the Therapeutic Project Program providing tax credits for early stage biotech companies and for pre-revenue biotech companies, the credits are convertible to a grant. The maximum benefit per company is 5 million dollars. The program opened up on June 21, 2010. To qualify, a company is required to demonstrate that they will produce new therapies, reduce the cost of healthcare or contribute to curing cancer. There is total of 1 billion dollars to be divided up amongst claimants seeking benefits.

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Business Method and Diagnostic Method Patents (June, 2010)

Business method and diagnostic method patents survive the US Supreme Court in In re Bilski; No. 08-964 (June 28, 2010.) Satisfying the machine-transformation test is an important clue to statutory subject matter and an apparent safe harbor. Nonetheless, the machine or transformation is not the only clue for patentable subject matter. The following are likely take home rule. (1) Abstract ideas and formulas are not patentable. (2) This prohibition cannot be overcome by adding a conventional or obvious post solution activity to the idea or limiting use of the formula to a particular technology environment. (3) Without dissecting the claim into new and old elements, if the claim is an application of a law of nature or formula to a structure or process (especially an industrial process,) the claim is statutory subject matter.

Spam email (June, 2010)

On the legality of spam email (i.e., unsolicited email proposing a commercial transaction,) the California Supreme Court rules that the anti-spam email statute by California (i.e., Business & Professions Code Section, 17529.5(a)(2) is not violated by sending email from multiple domains that are meaningless combinations of letters to disguise the sender, where the domain names are traceable. The purported reason that multiple domain names was employed was to evade spam filters. Further, in dicta, the Court seems to imply that for an email header (e.g., subject line) to offend the statute, it must contain a misrepresentation and not merely be misleading (see, Kleffman v. Vonage Holding Corp., S169195 (June 21, 2010).

The US Supreme Court rules in US v. Skilling and US v Black that the honest services fraud crime is limited to where the defendant takes a bribe or receives a kickback.

White Collar Crime; Honest Services (June, 2010)

Nondisclosure Agreements (June, 2010)

Business Transactions and Litigation: Non-Disclosure Agreement (NDA) Alert. There is a trap for the unwary in drafting NDAs. In Montz v. Pilgrim Films & Television, Ninth Cir. Case No. 08-56954 (June 3, 2010), the court ruled against the originators of a TV show concept on breach of implied contract and breach of confidence claims. The originator alleged that they: presented their ideas in confidence , pursuant to custom and practice of the entertainment industry. The NDA provided that if the receiving party breached, the disclosing party would share in profits; but, did not set a price for purchase and sale of the TV show concept. The court held that claims were pre-empted by the copyright act. It reasoned, inter alia: the plaintiffs expectation of profits and credit was premised on the fact that they would retain control over their work. The plaintiffs claim is part and parcel of a copyright claim.

 

Business Transactions and Litigation:In Benay v. Warner Bros, 9th Cir Case No. 08-55719, the court reinstated a claim by screenwriters who submitted a script under an implied-in-fact contract to sell it where the production company only took ideas and there was no substantial similarity for copyright purposes.

ActorsReporter.com Independence Day Party

URL with the brand name of a manufacturer can be a nominative fair use according to the Ninth Circuit in Toyota Motors v. Tabari; Case no. 07-55344 (July 8, 2010). The URL owner must first prove that it sells the trademarked good. The manufacturer than has the burden to disprove a nominative fair use. The factors are whether: (1) the product/service of the URL owner was readily identifiable without the use of the mark by the manufacturer; (2) the URL owner used more of the mark by the manufacturer than necessary and (3) whether the URL owner falsely suggested an sponsorship or endorsement by the manufacturer.

Third Party Using the Brand Name of a Manufacturer in a URL (July, 2010)

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