Tag Archives: Litigation

Costco neko wo kamu

Originally posted 2013-03-15 09:57:30. Republished by Blog Post Promoter

BrozikIf Tiffany was miffed at Costco before, it’s positively infuriated now.

You will recall that on February 14 the high-end jeweler Tiffany & Co. sued the decidedly-not-high-end warehouse club Costco, alleging that the latter was describing certain diamond rings as “Tiffany” rings in at least one of its locations, thus infringing upon the trademark rights of the former. For a refresher, see here.

What struck this writer as interesting about the otherwise not especially remarkable matter is the barely-concealed disdain for the defendant and its merchandise-for-the masses business model permeating the federal court complaint of the elite plaintiffs. Tiffany made an effort at civility in its initial filing… but now the kid gloves are off. Costco has asserted a counterclaim—and that counterclaim has already gotten Tiffany’s goat.

tiffany_130216_wgThe gist of Costco’s counterclaim is that notwithstanding the registrations held by Tiffany & Co. for various trademarks that include the name Tiffany for use with regard to jewelry products, the term “Tiffany” is generic for a type (or set of types; it’s not quite clear)  of diamond ring setting, such that anyone must be permitted to use the term (inasmuch as anyone may sell a diamond ring with that certain kind of setting). Costco’s Answer and Counterclaim reads, in pertinent, unrepentant part:

Costco asks the court to order that the Plaintiffs [Tiffany and Company and Tiffany (NJ) LLC] be prohibited and enjoined from ever again asserting false claims of right to exclude use of Tiffany as a generic term for a style or type of ring setting. *** Costco seeks a judgment declaring invalid, and ordering modified or partially cancelled, federal trademark registrations which the Plaintiffs have put forward as purportedly evidencing or supporting false claims of right to prevent Costco and other retailers from using the word Tiffany to indicate that a ring has a Tiffany setting, i.e., a setting comprising multiple slender prongs extending upward from a base to hold a single gemstone….

There’s a Japanese proverb—kyuuso neko o kamu: A cornered rat will bite the cat. Tiffany put Costco in the corner, and now Costco is attempting to bite off part of Tiffany’s trademark portfolio. Tiffany might come to find that it would have been better off letting sleeping dogs… er, you know what? Enough with the animal metaphors. Tiffany could regret suing Costco, if Costco’s possibly-desperate defense holds water.

Tiffany replied a couple of days ago, March 14, to Costco’s answer and counterclaim, filed on March 8th. Tiffany asserts in its answer to Costco’s counterclaim that Costco’s signage did not indicate that the offending rings sold in Costco warehouses (not manufactured by Tiffany) had “Tiffany settings” but rather appeared to describe each ring as a “TIFFANY… DIAMOND RING.” A good point—but now there are two issues. Read More…

Upper crust: the POCKET SANDWICHES (and maybe croissants) saga (Part 2 of 2)

Originally posted 2011-07-18 13:32:48. Republished by Blog Post Promoter

11291_Nimg

Last week I told the story — as told through this TTAB opinion — of Carl Vennitti’s seven-year tug of war with Nestlé, maker of Hot Pockets food-type product and owner of the HOT POCKETS trademark.  The battle was over Carl’s attempt to use and register the trademark SANDWICH POCKETS.  I promised that part 2 would consist of Carl telling his own story, because I believe, as a blogger, in the Freedom Principle.

Trademark lawyerWhat is the Freedom Principle?

I, as a blogger, have an obligation to use material submitted to me for free if there’s any rationale way it fits with the editorial and I can thereby get a post out of it.

There is no greater freedom than this.

There’s an extra surprise, because this guest submission comes with its own introduction by another trademark blogger, Benjamin Ashurov, who writes a blog called Trademark Bully.  I have added some explanatory links to his introduction to the SANDWICH POCKETS saga, regarding which, you may have noticed if you read this and the prior post carefully, I have actually offered no opinion.  I also take no responsibility for any factual claim in this post or this introduction and in fact welcome any opportunity to correct or clarify the record if appropriate.  I defer, instead, to the Freedom Principle along with a good-faith belief that the narratives published here are materially correct.  I have copy-edited the introduction and Carl’s magnum opus, but very lightly; readers familiar with this blog will see that both guest contributors here are speaking in their own voices.

Cue music, please — first, Benjamin:

After seven years of agonizing litigation, this forum shall allow us to present the over-reaching conducted by one of the world’s largest food companies, foreign owned, and the havoc that they can wreak on a family owned American business, what the results are, and how it affects individual family members who toil at manual labor.

His name is Carl.  He owns and operates a food manufacturing company in Warren, Ohio. He makes a great “pocket sandwich,” the term mandated by the USDA Food Safety and Inspection Service, that has found its way into schools throughout the midwest.

Not everyone thinks that he makes an outstanding product. According to a claim by Nestlé Prepared Foods, Hand Held Products’ division in Colorado, he made an inferior product! At the onset of the attack he was quite surprised at that published statement, because in fact he used to use a lot of Nestlé  products in his (he doesn’t use any more). It’s a ridiculous scenario, so you will have to use your own best judgment about the quality issue.

The whole purpose of the “quality” claim, of course, was to suggest that Carl’s use of a trademark claimed by Nestlé  was harming its reputation.  Yet just recently one of Nestlé’s Hot Pockets employees was arrested — for war crimes in Bosnia. Inferior products? Higher standards?

Most importantly for purposes of this forum, Nestlé also claims to have exclusive right to the word POCKET in a trademark. Left un-addressed, the consuming public may have to quit calling those extra pieces of fabric on clothes “pockets,” or Nestlé may accuse them of infringement, too!

Regardless of these claims, Carl, his family and his company are still supposed to call their food products “pocket sandwiches” by the USDA FSIS definition, and by the former definition in the USPTO’s “Trademark ID Manual.” Today he can.

Here, now, Carl’s story in his own words.  You may want to stick something in the microwave — it’s a long one!

I owe this essay to everyone who believed in creating a dream, and helped build his or her own company into the company we almost were. The following is truthful and factual, which makes it hard to dispute unless, alas, you possess, and are willing to spend, untold amounts of good money to destroy dreams and hard labor, credit, business, integrity and family, such as Nestlé did to me and my family. Read More…

Best of 2011: Upper crust – the POCKET SANDWICHES croissants saga

First posted on July 15, 2011.

Letters, we get letters.

Sometimes people just want to share their trademark woes with me. Sometimes they want free advice, or cheap advice, or just a broad, powerful if round trademarky shoulder to cry on. I am a man, and no one’s crying towel, yet — surely even a litigator can have feelings.

Carl Vennitti is no crybaby, but he has been sharing the story of nearly seven years of trademark-registration and opposition adventures with your tender-hearted blogger. His adversary: A little outfit called Nestle, another brutal chocolate-pusher but also famous as maker of — yes —

HOT POCKETS.

Hot Pockets. Carl’s mark (no, not Karl Marx! ahem): POCKET SANDWICHES — not (as originally written) CROISSANT POCKETS, and… not too confusing at all. Or is it?

Likely to be confused?

What do I know? Let’s ask the TTAB, which after dealing with some flaky procedural business — deftly addressed, as was the substance of the case, by (of course) John Welch shortly after the decision issued in May of 2011 — pulled that yummy concoction (one imagines) out of the microwave and laid it before us on a stiff wax-coated paper plate. Starved as we are for rich, IP-blawgy goodness, we reached for our heavy-duty plastic fork and knife and …

Ah, but first we must address the substantive crust of the matter before we bite into the hot, steaming mass and taste of the LIKELIHOOD OF CONFUSION analysis within. The better to let it cool off just a tad anyway, no?

It turns out that the opposer, Nestle, isn’t exactly quite the registrant of the trademark. It is a licensee of some foreign outfit that owns that piece of paper. Well, being a licensee is the same as being the real guy, right? Well, not necessarily. Certainly not necessarily in copyright… and also not in trademarks if you are before the TTAB. The Board noted that, even in the related District Court litigation, it had been recognized that, in a regular court, an “exclusive licensee of a trademark has the right to enforce the trademark” — but that this rule does not apply in the specialized context of a TTAB opposition proceeding:

We do not interpret the definition of “registrant” in Section 45 of the Trademark Act, 15 U.S.C. §1127, to include exclusive licensees to the extent that they may rely on Section 7(b) presumptions [of priority based on a first-use date in the trademark registration]. Licensees may enforce trademark rights, but must establish priority through evidence of use and may not rely on their licensor’s registrations.

That’s something to know and remember, right there! But before the inside of this hot sandwichy-type thing cools down too much, can’t we dig into the LIKELIHOOD OF CONFUSION (LOC) question?

Not so fast, hungry boy. Look, isn’t a Hot Pocket just, you know, a hot pocket? If it is, that’s a pretty weak trademark you have there! How can the opposer even oppose registration if it doesn’t even have a real trademark — i.e., a distinctive one?

Applicant argues that opposer’s mark, HOT POCKETS, is merely descriptive and the evidence of record is not sufficient to establish that it has acquired distinctiveness. . . .

Based on [a] survey in the first quarter of 2004 the HOT POCKETS brand commanded 96 percent brand awareness, meaning that when asked if a consumer had heard of the HOT POCKETS brand 96 percent responded yes. . . This evidence is sufficient to establish, at a minimum[,] that HOT POCKETS had acquired distinctiveness for frozen stuffed sandwiches by the first quarter of 2004, prior to applicant’s filing date.

Ninety-six percent? Yes, I’d agree — “at a minimum,” that’s distinctive, at least in the acquired sense, and that’s some rights you got there.

In view of the above, opposer has shown rights in the mark HOT POCKETS prior to applicant’s filing date and, thus, has established priority. We turn then to consider whether there is a likelihood of confusion.

My favorite part! Are you going to finish yours?  
Read More…

Don’t ask me to keep your secrets

Michael Atkins reports on an interesting development that could have a real effect on certain widespread litigation practices if it were to spread: A federal District Judge denying entry of a stipulated confidentiality order. Wrote the court:

There is a strong presumption of public access to the court’s files and records which may be overcome only on a compelling showing that the public’s right of access is outweighed by the interests of the public and the parties in protecting files, records, or documents from public view. . . . [P]arties seeking an order to seal any documents must provide a specific description of particular documents or categories of documents they seek to protect and a clear statement of the facts justifying a seal and overcoming the strong presumption in favor of public access.

Michael notes that this appears to be part of a trend in all courts in Washington. Clearly, there is no right or wrong to this policy, but it is, for sure, a policy decision and one that ought to be debated. There are two possible approaches: Read More…

Patent medicine

Victoria Pynchon collects and reflects on some of the recent thinking about whether patent litigation makes any sense for anyone besides patent ligitators.

Upper crust – the POCKET SANDWICHES croissants saga (Part 1 of 2)

Letters, we get letters.

Sometimes people just want to share their trademark woes with me.  Sometimes they want free advice, or cheap advice, or just a broad, powerful if round trademarky shoulder to cry on.  I am a man, and no one’s crying towel, yet — surely even a litigator can have feelings.

Carl Vennitti is no crybaby, but he has been sharing the story of nearly seven years of trademark-registration and opposition adventures with your tender-hearted blogger.  His adversary:  A little outfit called Nestlé, another brutal chocolate-pusher but also famous as maker of — yes —

HOT POCKETS.

Hot Pockets.  Carl’s mark (no, not Karl Marx!  ahem): POCKET SANDWICHES — not (as originally written) CROISSANT POCKETS, and… not too confusing at all.  Or is it?

Likely to be confused?

What do I know?  Let’s ask the TTAB, which after dealing with some flaky procedural business — deftly addressed, as was the substance of the case, by (of course) John Welch shortly after the decision issued in May of 2011 — pulled that yummy concoction (one imagines) out of the microwave and laid it before us on a stiff wax-coated paper plate.  Starved as we are for rich, IP-blawgy goodness, we reached for our heavy-duty plastic fork and knife and …

Ah, but first we must address the substantive crust of the matter before we bite into the hot, steaming mass and taste of the LIKELIHOOD OF CONFUSION analysis within.  The better to let it cool off just a tad anyway, no?

It turns out that the opposer, Nestlé, isn’t exactly quite the registrant of the trademark.  It is a licensee of some foreign outfit that owns that piece of paper.  Well, being a licensee is the same as being the real guy, right?  Well, not necessarily.  Certainly not necessarily in copyright… and also not in trademarks if you are before the TTAB.  The Board noted that, even in the related District Court litigation, it had been recognized that, in a regular court, an “exclusive licensee of a trademark has the right to enforce the trademark” — but that this rule does not apply in the specialized context of a TTAB opposition proceeding:

We do not interpret the definition of “registrant” in Section 45 of the Trademark Act, 15 U.S.C. §1127, to include exclusive licensees to the extent that they may rely on Section 7(b) presumptions [of priority based on a first-use date in the trademark registration]. Licensees may enforce trademark rights, but must establish priority through evidence of use and may not rely on their licensor’s registrations.

That’s something to know and remember, right there!  But before the inside of this hot sandwichy-type thing cools down too much, can’t we dig into the LIKELIHOOD OF CONFUSION (LOC) question?

Not so fast, hungry boy.  Look, isn’t a Hot Pocket just, you know, a hot pocket?  If it is, that’s a pretty weak trademark you have there!  How can the opposer even oppose registration if it doesn’t even have a real trademark — i.e., a distinctive one?

Applicant argues that opposer’s mark, HOT POCKETS, is merely descriptive and the evidence of record is not sufficient to establish that it has acquired distinctiveness. . . .

Based on [a] survey in the first quarter of 2004 the HOT POCKETS brand commanded 96 percent brand awareness, meaning that when asked if a consumer had heard of the HOT POCKETS brand 96 percent responded yes. . . This evidence is sufficient to establish, at a minimum[,] that HOT POCKETS had acquired distinctiveness for frozen stuffed sandwiches by the first quarter of 2004, prior to applicant’s filing date.

Ninety-six percent?  Yes, I’d agree — “at a minimum,” that’s distinctive, at least in the acquired sense, and that’s some rights you got there.

In view of the above, opposer has shown rights in the mark HOT POCKETS prior to applicant’s filing date and, thus, has established priority. We turn then to consider whether there is a likelihood of confusion.

My favorite part!  Are you going to finish yours? Read More…

Tidying up your Internet

Originally posted 2011-04-13 14:34:53. Republished by Blog Post Promoter

I was writing about ways to get to non-compliant IP-infringing websites before it was fashionable.  But eventually more and more law-enforcement folks and legislators have caught up with my visionary noodling and have been doing something about it too — and their something is the kind that matters.  At Randazza’s The Legal Satyricon, my colleague Jay DeVoy, whose practice is focused on the “adult” (porn) industry, writes that such legislative measures are not necessarily as good for, much less for the benefit of, the porn industry as some folks might be thinking or saying.

Trademark blogger Ron Coleman

Well, all right.  That’s a point as far as it goes.  Most of us aren’t losing any sleep over that.  Yes, I know, the actors lose out from infringement, and I’m not endorsing that at all.  But when it comes to infringement of intellectual property rights in pornography, the “exploitation” issue cuts in many directions.  Nothing personal.

But many people are troubled about the confiscatory and due process aspects of the trend toward ex parte seizures of virtual real estate.  There are real questions about how comfortable we should be about this level of government custodianship over the Internet.  I share these concerns, though I think that is a topic that’s too big for this blog, though I’ll keep an eye on it.  In fact, that also is not Malcolm’s topic.  He kind of likes the idea– which I find a little disconcerting considering the otherwise “civil libertarian” bent of his and Marc’s practice.

I was impressed, however, with a couple of other points Jay made in his blog post, which could be of great practical concern even from the perspective of the IP “enforcement” side of things — namely that this sort of busting-through-the-door stuff is not necessarily all that helpful for civil litigators.  First, to be fair, here’s the heart of Jay’s thesis:

On the surface, government intervention is a good thing – an entity with tremendous resources and power is stepping in to preserve the market for IP holders’ goods.  If you think the government is doing this for the benefit of the adult [sic] market – or that these efforts will in any way aid adult – think again.  As always, the beneficiaries of these policies are the groups that weren’t hurting too badly in the first place.  For example, the RIAA and MPAA spend tons of money pursuing infringers just to preserve the markets for their respective works, as they have the resources to do so, and simply meting out high-profile punishments without regard for what recovery they can actually obtain is sufficient to serve their ends.  For example, the movie industry posted massive profits for 2010.  Then there are brands like Gucci and Louis Vuitton that love government intervention so that the market for their overpriced products is kept free from cut-rate counterfeiters.

The adult entertainment industry lacks this kind of centralized, well-funded activism apparatus.  While the sums at stake for the industry as a whole may rival those sought – and spent – by the RIAA and MPAA, a patchwork approach to litigation, including undisclosed settlements, keeps outsiders from seeing the full scope of piracy’s damages.  In just one case, Evil Angel and Jules Jordan won a $17.5 million award against various defendants for DVD piracy – an activity that seems almost quaint in the current climate of BitTorrent litigation.  While that’s a huge award, too, it still pales in comparison to the amount of money the RIAA will spend to fight pirates in a single year.  Especially after Citizens United, money talks, and its the mainstream recording industries that are spending more of it to influence legislative activity.

So, evidently, this legislative push is not made with the intent of making life easier for adult content producers.  In practice, it will not behoove them either.  Here’s why:

Why is two main things:  The G-men destroy evidence, and they grab assets that would otherwise be available to satisfy the claims of civil claimants.  Read the whole post.

UPDATE:  More from Jay.  He’s not any happier.

 

About that SLAPP thing

Patton Slap

 

A number of law bloggers have posted recently (as noted by Colin Samuels at the link referred to in my previous post) in support of a federal statute to deal with the problem of lawsuits known as “strategic lawsuits against public participation”–SLAPP suits.   Ken at Popehat explains, and does so very well (except for his recurring bad habit of using dirty words — made family-safe here! — for no @%*!  good reason):

Last week Marc Randazza touted Congressman Steve Cohen (D-TN)’s Citizen Participation Act, a federal anti-SLAPP statute. It’s been boosted elsewhere as well. Randazza is absolutely [neato] on First Amendment issues — he has more fun than should be legal eviscerating opponents of free speech. I was happy to hear his call to make March “National SLAPP month,” and remain happy even after Patrick explained to me that it doesn’t mean I actually get to hit anyone. But I’m not entirely with Marc on Rep. Cohen’s bill.
First things first: for those not in the know, an anti-SLAPP statute protects litigants from meritless and/or frivolous lawsuits attacking protected speech. The statutes differ substantially among the few jurisdictions that have them, but they all share the same core idea: when plaintiffs sue defendants for certain types of speech, defendants should be able to force the plaintiff to convince a judge that they have a case before they force defendants to incur ruinous litigation costs. Some anti-SLAPP statutes are vigorous and effective, like California’s. I’m very fond of California’s anti-SLAPP statute, under which a judge recently ordered a plaintiff to pay my client nearly $35,000 in attorney fees. Other states, however, have narrow, weak, or ineffective anti-SLAPP statutes — take Maryland, for instance. Many jurisdictions have no anti-SLAPP statutes at all. There’s no existing federal anti-SLAPP statute, though federal courts have sometimes applied state anti-SLAPP statutes to pendant state claims or state claims in diversity cases.

Ken is right:  There are some serious problems with anti-SLAPP laws.  I have been so under water that I haven’t had the chance to respond to the original email that went out urging that we post on this topic, and the movement sort of moved on without me (amazingly!).  But while so many of my clients have been wrongly harmed, or even destroyed, by what could definitely be described as SLAPP suits — which in theory this new law would “solve “– at least one of them has been beat up pretty good by misapplication of the California version of this law, too.   All of which goes to show just how “solutions” consisting of more law so often end up doing exactly the opposite of what they were meant to do.

In the one particular case where this happened, my client — the “famous” S & L Vitamins, here sued under another business name, “Body Source” — was the defendant in a case brought by California Tan, a maker of indoor tanning salon goop.  This was the first “tanning lotion case” in that series of litigations in which the tanning lotion companies threatened to file, or in this case did file, complaints that were rafts of specious intellectual property claims meant to stop S & L from competing with the companies’ “authorized” distributors, despite their legal right to do so (and despite the fact that it was these distributors who were selling them the stuff in the first place).

In other words, for those of you who are not regular readers and hence already sick of the topic, these cases were nothing more or less than a business strategy to financially break companies that had the temerity to sell merchandise online without permission of the manufacturer.  Eventually these companies ended up being owned by one big fat one now called, quite ironically for the Dark Lords of indoor self-immolation, New Sunshine LLC.  And eventually they found that judge who was willing to shut S & L Vitamins down under a unique theory of liability (i.e., aggravated filing of legal arguments the Court does not understand).  But in 2004, this process was just beginning.

Creative as ever, among our counterclaims in the “Cal-Tan” case was a charge that the plaintiff was — as ultimately all the tanning lotion companies under this umbrella did — using meritless trademark infringement actions, and the threat of them, as a form of unfair competition itself.  This is not, as demonstrated below, a novel proposition under the cases; and as a matter of common sense, it is pretty self-evident.

Plaintiff’s California Ãœber Alles response, however, was to go out and hire a specialty law firm that handles mainly SLAPP cases, substitute them into the case for the general counsel, and make a motion to dismiss, and for sanctions, under California’s SLAPP statute based on this counterclaim.

We fought vigorously.   Read More…