You have heard about banks that are "too big to fail." Well, we are about to find out if some law firms are too big to make mistakes.
IP Litigator Philip Mann Named to 2014 Washington Super Lawyers List
Normally we don’t toot our own horn – but we are pleased and honored to announce that our founder Philip P. Mann was recognized in the 2014 Washington Super Lawyers ranking which lists the top attorneys in the state of Washington. The annual Super Lawyers list was featured in the July issue of Seattle Met magazine.
Super Lawyers is a rating service that selects outstanding lawyers from more than 70 practice areas who have attained high degrees of peer recognition and professional achievement. The selection process includes independent research, peer nominations and peer evaluations.
Mann is a trial lawyer with more than 30 years of experience litigating patent, trademark, copyright, trade secret and other intellectual property matters. He has broad experience representing clients in jury trials and bench trials before federal and state courts across the country, and in appeals to the Federal Circuit. Mann, who also has a degree in Electrical Engineering, worked in private practice in Chicago, Milwaukee and Seattle before founding the Mann Law Group in 2004.
I’ll avoid the rampant irony of taking a trademark around Jesus’ name and/or using The Lord’s name in vain for the sake of financial gain. (Isn’t there something about that in the Bible?)
Television/movie star and man-of-many-faces Tyler Perry successfully snatched away the mark: "WHAT WOULD JESUS DO" from Reality TV "star" Kimberly Kearney ("Poprah" on I Want to Work for Diddy). Perry convinced the Trademark Trial and Appeal Board (TTAB) that Kearney never used the Mark and/or abandoned the Mark.
According to the TTAB decision, Perry attempted to register the Mark for "’Entertainment services in the nature of an on-going reality based television program,’ in International Class 41" (Reg. No. 3748123). Perry then successfully convinced the Board that Kearney did not use the Mark in connection with any television program. Three big lessons from all of this …
Lesson #1: Always Answer the Requests for Admission.
Kearney did not respond to Perry’s Requests for Admission. Accordingly, TTAB found that Kearney admitted to everything that Perry requested and that such facts she "admitted" are now "conclusively established." (Fed. R. Civ. P. 36). Even though she denied those facts in her Answer, her failure to respond to the Requests for Admission trump those denials. YIKES. Let that be a lesson to those of you in litigation – Respond to your Requests for Admission.
Lesson #2: Mind Your Meetings
Here, Kearney alleged that she attempted to start a reality show by pitching it to … coincidentally enough … Tyler Perry Studios.
We see this all the time in trademark law. Here’s what probably happened: Kearney likely walked in to TP Studios, gave them an idea for a ridiculous reality show, didn’t really have much protectable IP, but did have a federal trademark on a name for said ridiculous show. Then, the TP Studio executives likely said "no thank you" to Kearny, then decided that she still had a neat name for a show. Tyler Perry studios, realizing Kearny would likely never make anything of the Mark, filed to cancel it and take it away from her. What should you remember from this? Mind Your Meetings!
If you’re going to meet with someone who might steal your intellectual property, make sure you get in a Non-Disclosure Agreement at the very least. Here – it didn’t look like Kearny had much in terms of trademark rights, but this is still very indicative of how many large companies operate. Many have been known to pretend to be disinterested in your ideas only to misappropriate them later. Worse yet, sometimes they will string you along for several weeks/months/years of negotiations to get more information and then tell you they aren’t interested.
Lesson# 3 Actual Use Still Counts
A federally-registered trademark is presumed valid, but that does not make it invincible. In other words, "use it or lose it." If Kearny had actually made use of this trademark in some way relating to producing a show around it, she could have survived cancellation. At the very least, she could have gotten this issue in front of a judge or jury and slowed down the process. The press around the dispute very well could have gotten her a TV deal with someone other than TP Studios. What might be interesting later is if Tyler Perry poaches some of Kearney’s substantive material around her show (assuming she actually has some).
Hershey’s Chocolate, Inc. filed suit (Case No. 2:14-cv-00815-RSL) for Trademark Infringement in U.S. District Court in Seattle against Conscious Care Cooperative (Seattle CCC), a Seattle company which describes itself as "a non- profit cooperative that is dedicated to providing its members the highest quality of organic medicine or Medical Marijuana in Seattle."
What’s bugging Hershey’s exactly? This (photo credits Kiro TV news):
According to the Complaint filed Tuesday, June 3, Hershey’s is alleging the following causes of Action
- Count One: Federal TM infringement of the various REESE’S, REESE’S PUFFS, and MR. GOODBAR marks and/or trade dress. (15 USC 1114)
- Count Two: Trade dress infringement, false designation of origin, and unfair competition. (15 USC 1125(a)).
- Count Three: Trademark and Trademark Dilution. (15 USC 1125(c)).
- Count Four: Violation of Washington State Trademark Dilution Statute. (RCW 19.77.160)
- Count Five: Violation of Unfair and Deceptive Practices Act. (RCW 19.86.020).
- Count Six: Common Law Trademark Infringement and Unfair Competition
FEDERAL TRADEMARK LAW AND CANNABIS LAW
Generally speaking, you cannot get federal protection over your cannabis-related marks. Sections 1 and 45 of the Lanham Act only covers "lawful" use in commerce, but THC, the active high-inducing chemical in marijuana, is still very much illegal under the Controlled Substances Act. Not surprisingly, the Feds aren’t too keen on protecting what they still (half-heartedly) believe to be an illegal substance. Therefore, based on priority of use, and federal protection, Hershey’s very clearly has superior rights in its marks to the Seattle CCC.
WHAT WILL BE THE OUTCOME?
Of course there are many ways to win (and lose) a case. If you remove the cannabis aspects of this case, it’s fairly straight-forward. Hershey’s has superior rights, and a reasonable jury could view the marks to be confusingly similar. This is a fact question, so it’s unlikely that this aspect would be decided on summary judgment.
But the cannabis elements admittedly cloud the analysis. Do federally-protected TM rights in legal candy trump state-protected rights in cannabis candy? Normally, the answer is "yes", but only a handful of states have legalized medicinal marijuana, and only Washington and Colorado (as of June 10, 2014) have legalized recreational marijuana. Seattle CCC could therefore argue that its customers are in a very niche market and very distinct from Hershey’s customers and that no reasonable consumer could possibly mistake a pot treat coming from Hershey’s.
What about the dilution/tarnishment claims? Is Seattle CCC really "diluting" the Hershey’s mark? Would people truly think that "Reefer’s" came from Hershey’s and that the Seattle CCC will likely cause harm to the fine upstanding Hershey’s name? In my very humble opinion, if someone wants to ingest cannabis, they buy and ingest cannabis. If someone wants to buy candy, they buy and ingest candy. Sure, maybe some careless parents might leave some cannabis-candy on the counter and Little Johnny and Little Suzy might mistakenly eat it, but regulating that sort of thing shouldn’t be in the wheelhouse of federal trademark law. We have plenty of state-based organizations for that in Washington.
My cynical/tactical thinking is that Hershey’s is looking to cash-in on the national pot craze without actually getting its hands "dirty" in the business. Hershey’s likely wants to collect a settlement and/or license agreement for pot dealers to use its trade dress and trademarks. Obviously this would only be enforceable in Washington state, because – again – the Feds won’t enforce contracts that are illegal under federal law. This way, Hershey’s won’t openly affiliate with drug dealers; won’t have to invest in the infrastructure to make cannabis candy; and will be able to collect some cash on the side from budding industry (couldn’t resist).
I’ll do my best to follow this case very closely and provide more insight as my time permits. Until then, if you have any questions on trademark issues, feel free to contact Mann Law Group.
Hershey’s is suing a Colorado cannabis dealer as well:
We’ve been exceptionally busy lately, so this is the first time we’ve had some time to actually take a look at what we’ve accomplished.
The Mann Law Group, now with a new associate Timothy Billick (bio and press release to come later), partnered up with John Whitaker to obtain a unanimous jury verdict award in the case Brilliant Instruments Inc v. GuideTech Inc. in the Northern District of California, Oakland Division (Case No No. C. 09-5517). The jury accordingly awarded a six-figure damages award to Mann Law Group’s client. The firm represented GuideTech in this declaratory judgment action initiated by Brilliant Instruments.
The case covered Patent No. 6,226,231 (‘231 Patent), which generally relates to a "plularity of measurement circuits" which are used to measure electrical signals down to the picosecond range. For you nomenclature nuts, that’s 10 to the -12th second (or one-trillionth of one second). MLG inherited the case from several other law firms after it had been successfully appealed to the Federal Circuit and remanded to Oakland for trial.
"None of that was unanimous"
Every case has at least one or two lessons to be learned. This case? Always poll your jury, and always explain what "unanimous" means. After the judge had re-explained her instructions to the jury, the jury initially told us we lost. However, just as the Hon. Judge Claudia Wilken was getting ready to enter the judgment, one of the jurors spoke up in open court and informed the Court that the verdict "WAS NOT UNANIMOUS!"
The jury was ordered to continue deliberations. The next day, they came back in our favor.
We still have motions pending for an injunction, a defendant’s motion to set aside the jury verdict, and a motion for an amendment of the judgment, but we have safely moved past the jury, and we have a damage award.
Next time we will take great care to make sure the judge tells the jury what "unanimous" means in jury instructions.
This recent article from the Wall Street Journal brought a chuckle. Seems the Obama Administration just stepped in to veto an ITC ruling, won by Samsung, that barred importation of certain Apple iPads and iPhones. What’s interesting is some of the language used to justify the veto:
U.S. Trade Representative Michael Froman made the decision to veto the ban on the Apple devices, citing concerns about patent holders gaining "undue leverage" as well as potential harm to consumers and competitive conditions in the U.S. economy.
* * *
Critics of the ITC order questioned whether companies should be able to block rival products in cases involving patents that have been deemed to be essential to creating products based on key technologies overseen by industry standard-setting groups.
* * *
"We applaud the Administration for standing up for innovation in this landmark case," an Apple spokeswoman said in a statement. "Samsung was wrong to abuse the patent system in this way."
"Undue leverage," huh? Questions "whether companies should be able to block rival products." And, "abuse [of] the patent system." Gee, where have I heard those words before?
I trust Samsung and its lawyers are sitting back in quiet reflection today, wondering how they let their professional and ethical standards slip so far as to let them engage in such underhanded tactics, and vowing never to do it again.
Abusing the patent system, indeed.
It appears my comment regarding a recent New York Times article on "patent trolls" — and my suggestion that defense lawyers might be the major beneficiaries of the so-called "troll" problem — has touched a nerve.
For some reason Mr. Guiliano takes me to task for simply accepting the figures provided in the article and doing some back of the envelope, but nevertheless sound, calculations based thereon. (In my comment, I simply read and directly quoted what was reported in the New York Times — you know, "All The News That’s Fit To Print" etc.) It was that article, and not I, that reported: (1) "United States companies — most of them small or medium-sized — spent $29 billion in 2011 on patent assertion cases," (2) "only about $6 billion of that money wound up in the hands of inventors,” and (3) "As for the other $23 billion, most of it goes to legal expenses…" (In the article’s defense, it quotes a "study" and its co-author in making those claims.) If those facts and figures are not correct, take it up with the New York Times and its sources, not me.
Mr. Guiliano goes on to say, " So, if Mr. Mann had read the report he linked to, he would have learned that the legal costs totaled $6.67 billion, less than 1/3 of his $20 billion figure." True, I did not read the report, I merely relied on what one of its co-authors had to say about it to a NYT reporter. If he misrepresents the contents of his own report, and does so to a reporter for perhaps the nation’s best known paper, why is that my fault?
On a more substantive and serious note, the point here is that glib statements about patent trolls, and popular press articles about unsavoury individuals and their lawyers gaming the system, should not be accepted at face value and should not escape critical review.
Here I simply took a thinly disguised anti-patent-troll article at face value and drew some reasonable conclusions from what was reported. When that article unintentionally leads to some less than flattering conclusions about the defense bar, the backtracking and explaining begin.
Mr. Guiliano is absolutely correct when he says, " Mr. Mann has not made that claim in his blog post…[he] relied on a reporter’s account of an interview with James Bessen and then did a quick calculation." Indeed, nowhere does Mr. Guiliano point to any flaw in my calculation. Instead, the bulk of his post is directed toward showing that the cited study does not actually say what its own co-author said it does, and does not actually mean what its own co-author stated to a New York Times reporter.
My rationale for my comment is simple; It is based on face value acceptance of what those in the "anti-troll" camp claim, followed up with some basic arithmetic. What, pray tell, is the rationale for Mr. Guiliano’s snide comment at the end of his post?
Last week I asked how it is that large firms somehow manage to bill their clients millions to dispose of frivolous cases based on clearly invalid patents that couldn’t possibly be infringed anyway.
Well, maybe the financial realities facing "Big Law" might have something to do with it.
This interesting article in the New York Times regarding a so-called "patent troll," raises the obvious question: If the patents are obviously no good and the claims of infringement clearly frivolous, how is it that supposedly top-notch lawyers must charge millions to show that to a judge?
I found this statistic from the article telling:
"One study found that United States companies — most of them small or medium-sized — spent $29 billion in 2011 on patent assertion cases. ‘And only about $6 billion of that money wound up in the hands of inventors,’ said James Bessen, a co-author of the study and a professor at the Boston University School of Law. ‘As for the other $23 billion, most of it goes to legal expenses…’"
Legal expenses, eh? Incurred by whom?
Assuming a more-or-less standard 33% contingency fee, this means the inventors get $6 billion, their lawyers another $3 billion, meaning about $20 billion goes to defendant’s counsel — you know, those upstanding lawyers who complain about trolls, frivolous suits, abuse of the system, and threats to our American Way of Life, and only reluctantly — reluctantly, I say– put that $20 billion in their pockets.