Dec
06

A Trade Secret Is a Trade Secret…. Until It’s Not

Unlike a patent, registered copyright, or registered trademark, all of which are the result of a formal grant by a government agency such as the United States Patent & Trademark Office, a trade secret has no such formal governmental recognition.  Instead, the trade secret owner must take proactive steps to both establish and protect its trade secrets.  To prevail in a trademark misappropriation lawsuit, the trade secret claimant must be able to define the trade secret, explain why it’s a trade secret, and demonstrate the steps it has taken to protect the trade secret from dissemination.

A common mistake in the world of trade secret IP is that many think that simply designating a document as confidential will automatically confer trade secret status on that document and its underlying content.  As discussed in our Nov. 21, 2023 blog entitled “Boosting Enterprise Value Through Trade Secrets,” this understanding is incorrect.

Consider a recent 2023 case out of Texas where the jury concluded that a telecom company acted in bad faith by filing a $23 million trade secret misappropriation lawsuit against a competitor; the court found that the underlying technology was not a trade secret.  Telegistics, Inc. v. Advanced Personal Computing, Inc. d/b/a/ Liquid Networx, no. 2019-15000 in the 190th District Court of Harris County, Texas.  Telegistics alleged that its former employee obtained a copy of Teligistic’s internal Request for Proposal (“RFP”) and used it as the basis for tweaking his new employer’s (Liquid Networx) internal RFP.  That is, the former employee altered the RFP so that it could be used by his new employer.  As such, Liquid Nerworx did not itself spend time and resources developing its own RFP.

Telegistics had made its RFP available to on-line to bidders who were invited to submit responses for Telegistics’ products and services.  The document included a confidentiality notice and information that permitted bidders to submit responses for Telegistic’s telecom products and services.  Telegistics claimed that the RFP was a trade secret.

Defendant Liquid Networx challenged the existence of Teligistic’s alleged trade secrets, claiming the plaintiff had not clearly defined its trade secrets.  Liquid Networx argued that while the source code of Telegistic’s platform, for example, could qualify as a trade secret, the actual output generated by the platform, such as the RFP, was not entitled to trade secret protection just because a confidentiality label was affixed to it.  Unfortunately for it, Telegistics was also unable to demonstrate any reasonable efforts it had made to keep the information it received from bidders confidential once received.

The jury agreed.  Interestingly, the jury went a step further and additionally found that Teligistics acted in bad faith by filing its lawsuit.  Networx is now seeking its attorneys’ fees as a result.

As our earlier blog emphasized, the plaintiff in a trade secret misappropriation lawsuit must at the get-go establish that it does indeed have protectable, definable trade secrets.  Telegistics did not meet this threshold.  Texas, as with almost all of the other fifty states, including Florida, has adopted the Uniform Trade Secrets Act as its statutory trade secret law.  Accordingly, it is highly likely that the same decision would have been reached no matter what jurisdiction the Telegistics case had been brought, namely, that the RFP was not a trade secret.

Take-Home Points.

The “confidential” labelling of a document, without more, will likely be insufficient for converting the confidential document into a trade secret.   Moreover, documents generated automatically by a software program that itself qualifies as a trade secret (e.g., source code and/or object code) may not qualify as a trade secret if other factors are not present.  For example, what steps has the trade secret claimant made to limit the dissemination of the collected information within the organization?

Here are some tips for consideration.

  1. Consider the nature of the document. Is it a general information form or something highly unique to be used in generating a potential economic benefit, e.g., a manufacturing document containing trade secret raw material specifications and which has limited access within the company.
  2. What is the purpose of the document?  Does it contain information about a trade secret (e.g., generally unknown information about a critical raw material component) where the development of the underlying trade secret involved creativity, considerable time, and considerable resources from human resources to financial resources (e.g., R&D spending)?
  3. Is the “confidential” document more of a general information form or a specially developed form?
  4. Is there an economic value that comes from maintaining the document’s confidence?
  5. What steps are taken to keep it from third parties and to limit access to the document within the company?
  6. If it is to be disseminated to third parties, what safeguards are in place to limit the dissemination of the document?
  7. When hiring an employee who has worked for a competitor, consider having the employee sign a document stating that, if he had any access to his/her former employer’s trade secrets, that he/she will not use any such trade secrets in the course of his new employment.  Such a document may help the new employer, if ever accused of trade secret misappropriation, establish that it took reasonable precautions to prevent the “entrance” of any trade secret information belonging to the trade secret claimant into new employer’s business.   This approach could help reduce the amount of any damages award.

 

In conclusion, every business, no matter how small, should be looking into trade secrets as a valuable asset, meaning one which can be monetized and form a part of an IP portfolio.  However, claiming something is a trade secret in a trade secret misappropriation lawsuit does not necessarily make it so as the Telegistics case demonstrates.    Any attorney who commences a trade secret lawsuit on behalf of a client needs to honestly assess whether the alleged trade secret will actually qualify as a trade secret under state statues and case law.   The same also applies where federal trade secret theft claims are involved as under, e.g., the Defend Trade Secrets Act.  Contact Susan at Troy & Schwartz (305-279-4740) to request a complimentary copy of her trade secret implementation checklist and work with her to conduct a trade secret audit, create appropriate protection systems, etc. or to represent you in trade secret misappropriation matter.

THANK YOU FOR YOUR INTEREST IN THIS BLOG.  AS USUAL, THE CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT LEGAL ADVICE.


© 2023 by Troy & Schwartz, LLC

 

 

 

 

 

 

 

 

 

  • Comments Off on A Trade Secret Is a Trade Secret…. Until It’s Not
  • Add Comment

OTHER RECENT POSTS

Jul
22

THE TACO TUESDAY TRADEMARK HAS ENTERED THE GRAVEYARD FOR GENERIC MARKS

Take Home Points

  1. A distinctive registered trademark can become generic over time meaning it is no longer protectable as a registered mark. Such a mark can also be subject to cancellation.
  2. Ceasing the opportunity to overcome negative press can alleviate bad press in the court of public opinion.

In 1978, the trademark TACO JOHN’S  was registered with the USPTO.  In 1989, the owner of the TACO JOHN’S mark received a registered mark for Taco Tuesday (Reg. No. 1572589).   In 2019, the current owner of both marks, Spicy Seasons, LLC, sent a cease-and-desist letter to Freedom Edge’s Brewery Co. for using the term “Taco Tuesdays” to advertise a taco truck that parks outside the brewery once a week.   Spicy Seasons had every right to do so as the owner of the registered mark, but Freedom Edge did not keep the matter private. Soon Facebook became the forum for litigating the matter in the court of public opinion via social media.

Then in March 2023, Taco Bell IP Holder, LLC, the owner of the TACO BELL mark and a competitor of Taco John’s restaurants, filed a petition with the Trademark Trial & Appeal Board (TTAB ) to cancel the Taco Tuesday mark on the grounds that the mark had become generic.  The cancellation petition is tongue-in-cheek and quite humorous.  For example, paragraph C under the Preface states: “The Registration potentially subjects Taco Bell and anyone else who wants to share tacos with the world to the possibility of legal action or angry letters if they say “Taco Tuesday” with express permission from the Registrant – simply for pursuing happiness on a Tuesday.  This violates an American idea: “the pursuit of happiness.”

Rather than participate in the cancellation proceeding, this month Spicy Seasons filed a Notice of Abandonment of the TACO TUESDAY mark with the TTAB, effectively ending the cancellation proceeding.  This business decision makes good sense for two reasons.  First, there was considerable negative press about Taco John’s “beating” up on small proprietors.  In doing so, Spicy Seasons seized on the opportunity to make amends in the arena of public opinion by announcing it was abandoning the mark and giving a substantial donation to Children of Restaurant Employees.  It also challenged Taco Bell to do likewise since they will not have to spend further legal fees on the cancellation proceeding.

Second and from a legal perspective, “TACO TUESDAY” has suffered from genericide because it has become too well known to still be identified with Taco John’s.  It is not unusual for an initial distinctive registered mark to become generic and lose its registered trademark status over time.   Two examples are:  DRY ICE (Originally a trademark of Dry Ice Corporation of America) and  ESCALATOR (Originally a trademark of Otis Elevator Company).   Once a mark becomes generic, it risks losing its ability to enforce its mark.  Not only has the term “Taco Tuesday” been used frequently across the country but the mark was also featured in the 2014 “The Lego Movie.”

Also note that the USPTO will not register a generic mark.   For example, a local store just calling itself “Boutique” for clothes would have no trademark rights to that identifier. The rationale for refusing the registration of generic marks is: since they describe common terminology for specific industries, generic terms are free to use by any brand owner in its development, marketing, promotion activities, etc.

In conclusion, Spicy Seasons chose to officially abandon its now-generic TACO TUESDAY mark.  Had  Spicy Seasons filed trademark infringement lawsuits, defendants could have sought cancellation of the mark by the court on generic grounds.

Waffle Wednesday anyone?

Have a question on obtaining a registered trademark nationally and/or internationally or enforcing your rights as a registered trademark owner? Contact us at 305-279-4740.  And check Susan’s reviews at www.avvo.com.  Be sure to check out our other trademark law blogs at www.troyandschwartzlaw.com.

THANK YOU FOR YOUR INTEREST IN THIS BLOG.  AS USUAL THE CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT LEGAL ADVICE.

© 2023 by Troy & Schwartz, LLC

 

 

 

  • Comments Off on THE TACO TUESDAY TRADEMARK HAS ENTERED THE GRAVEYARD FOR GENERIC MARKS
  • Add Comment
Jul
15

INTERNATIONAL TRADEMARK REGISTRATION STRATEGY AFTER SCOTUS’S DECISION IN ABITRON AUSTRIA v. HETRONIC INTERNATIONAL

The blog provides a detailed analysis of the U.S. Supreme Court’s June 29, 2023 decision in Abitron Austria v. Hetronic International, a case which involves international trademark rights.   Justice Sotomayer’s concurrence, reading more like a dissent, is, in this commentator’s opinion, the correct legal application of the Lanham Act.

Quick Overview of Abitron’s Take Home Points:

  1. More than ever before, trademark owners will likely need to protect their marks abroad by registering the mark in the countries in which the goods/services will be sold and/or even manufactured.
  2. Contracts between U.S. companies and foreign parties need to clearly specify ownership and use of the relevant IP globally to clearly provide a contractual basis for trademark infringement liability related to conduct outside of the U.S.

Analysis

U.S. trademark law is governed by the Lanham Act (“Act”).  The Lanham Act was enacted at a time when international commerce was far less common than it is today. Sections 1114(1)(a) and 1125(a)(1) of the Act specify remedies for trademark infringement.  The former section pertains to situations when a person without the consent a trademark registrant uses in commerce a reproduction, counterfeit, copy, or colorable imitation of a registered mark in connection with the sale, offer for sale, distribution, or advertising of any goods or services or in connection of such use is likely to cause confusion, cause a mistake or deceive with a registered is used in commerce.  The latter section pertains to situations where any person, who on or in connection with any goods or services, or any container for goods, uses in commerce any word, term, name, symbol, or device or any false designation of origin, false, or misleading description of fact or false or misleading representation of fact is likely to cause confusion, cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person as to the origin, sponsorship, or approval of his or her goods.

Registered marks are enforceable under the laws of the country in which they are registered.  As for infringement activities, neither of the above referenced Lanham Act sections define what is meant by “in commerce.”  That is, does “in commerce” pertain to infringing activities of a U.S. registered mark only in the United States for a U.S. registered mark? Or does it “in commerce” include commerce within foreign jurisdictions?

The underlying case involved Hetronic’s radio remote controls, which are used to operate heavy-duty construction equipment, such as cranes.  An agreement between Hetronic and Abitron allowed Abitron to make and sell Hetronic-branded products that contained genuine Hetronic parts. In 2015, Hetronic sued Abitron and its affiliates in Oklahoma federal court, alleging they breached the contracts by making and selling products with unauthorized parts.   The district court awarded Hetronic a permanent injunction blocking Abitron from further infringement worldwide.  The jury’s $96 million dollar award was upheld by the Tenth Circuit Court of Appeals even though Abitron had argued that 99.98% of its infringing sales happened abroad.

In affirming the district court, the appeals court found that a significant amount of Abitron’s foreign sales of the infringing products ended up in the U.S. and Hetronic provided evidence that these sales caused confusion among U.S. customers and “even Abitron Germany’s own U.S. distributor.”  In finding for Hetronic, the appellate court also stated that the fact that only a small percentage of Abitron’s products made it into the U.S. was irrelevant.  “Otherwise, billion-dollar-revenue companies could escape Lanham Act liability by claiming millions of dollars of their infringing products from entering the U.S. represented only a fraction of their sales.”  The opinion also emphasized that the Lanham Act applied because Abitron “diverted tens of millions of foreign sales from Hetronic that otherwise would have ultimately flowed into the U.S.”

Abitron appealed to SCOTUS arguing that the Lanham Act is not applicable when infringement occurs outside of the U.S. for a U.S. registered mark and does not cause likelihood of confusion within the U.S.  Arbitron again emphasized its “small” percentage of U.S. sales.

SCOTUS construed the “in commerce” references in Sections 1114(1)(a) and 1125(a)(1) as providing no express statement of [the Act’s] extraterritorial application beyond U.S. borders or any other clear indication that [the Act] is one of the ‘rare’ provisions that do apply abroad. Having found that the Lanham Act provisions are not extraterritorial, SCOTUS next determined whether Hetronic’s claims involved domestic (i.e., in the U.S.) conduct.  According to the majority, Arbitron’s use in commerce (i.e., conduct) was not in the U.S.  As such, there could be no likelihood of confusion in the U.S and the Tenth Circuit’s decision was thus vacated.

Justice Sotomayer’s concurring opinion argued that the analysis should actually include a two-pronged approach.  She agreed that there is no indication that the Lanham Act’s “in commerce” provision has an extraterritorial reach.  However, a “domestic application of the statute can implicate foreign conduct in prong two of the analysis so long as the plaintiff proves a likelihood of confusion domestically.”   She concluded that the case should be vacated not because of the majority’s reasoning but because the Tenth Circuit and the district court did not apply the proper two-prong test.  As she emphasized, for a plaintiff to prevail on the second prong of such an analysis, the plaintiff must offer proof of likelihood of confusion by U.S. consumers as a result of the defendant’s extraterritorial infringing activities.  The majority’s statement that such a test would open the floodgates for confusion by the lower courts in applying the Lanham Act is thus misplaced.  Instead, the majority’s conduct-focused test on remand is improper because that test “is not supported by either the Lanham Act or this Court’s traditional two-step extraterritoriality framework.”

In reaching its conclusion, the Court did not rely on its decades-old previous decision on the Lanham Act’s extraterritorial reach in Steele v. Bulova Watch Co. Inc., 344 U.S, 280 (1952). That case involved both domestic conduct by a U.S. citizen and the likelihood of domestic confusion.  The Steele case involved a San Antonio, Texas resident who purchased unfinished Bulova watches and took them to Mexico for finishing.  When he learned that Bulova had not registered its mark in Mexico, he obtained a Mexican trademark which was later cancelled by the Mexican trademark agency.  His watches, sold in Texas and Mexico, were of inferior quality.

The Steele Court held that, “[w]here as here, there can be no interference with the sovereignty of another nation (because the defendant no longer had a Mexico-registered trademark), the District Court, in exercising its equity powers, may command persons properly before it to cease or perform acts outside its territorial jurisdiction.”

The Supreme Court in Abitron noted that the Steele and Abitron cases involve a different set of facts; in Steele, the plaintiff’s “in commerce” conduct within the U.S. was clear.  Even so, unfortunately, the Abitron decision now seemingly immunizes all trademark infringement that originates abroad regardless of whether that infringement (“the conduct”) also causes adverse effects (a damaging result”) in the U.S.   The various circuit courts of appeal had relied on Steele v. Bulova to develop different tests for applying the Lanham Act extraterritorially.  Will these courts now need to reevaluate their tests in light of the Arbitron decision?

Moreover, the Arbitron decision arhttps://www.law.cornell.edu/uscode/text/15/1125guably misses the Lanham Act’s point: that the focus should be on whether consumer confusion (the result) ultimately occurs in the U.S., not whether the defendant’s use (the conduct) was abroad or domestic.  SCOTUS in essence has established a bright-line test, overturning over 60 years of jurisprudence from the various circuits since Steele.  If the defendant’s use in commerce occurs abroad, then no claim can seemingly now be made under Abitron.  Yet with our global economy, the possibility of extraterritorial infringement has increased dramatically including promoting the importation of counterfeit goods into the U.S.  Abitron, as a foreign infringer, may not have intended that its problematic goods ever end up in the U.S., but some did as the district court case found.

The Act’s Section 1125(b) does cover importation of imported counterfeit goods (goods marked or labeled in contravention of the provisions of Section 1125(b) wherein such goods are not to be imported into the U.S. and may be seized by customs and border patrol.  The port of Miami alone seizes millions of dollars of counterfeit goods on an annual basis.  Obviously, the manufacture of such goods is an extraterritorial activity.  But here, the Act clearly is intended to prevent a U.S. effect from happening in the first place.   Unfortunately, foreign counterfeiting of major U.S. brands continues to be a significant problem particularly in the areas of electronics, pharmaceuticals, and fashion.  The Arbitron opinion may well make it more difficult for U.S. companies to enforce their trademarks and stem the flow of counterfeit goods into the U.S. (which happened with Arbitron’s counterfeit products as the jury found) when such items make it past customs and border control.

Conclusions

After Abitron, trademark registration strategies even by smaller companies should consider the possibility of registration in appropriate foreign jurisdictions.  For example, had Hetronic had an Austrian registered mark or an EU registered mark, it would have had an action for trademark infringement in Austria or any EU member country where the infringement occurred.   Please also see the take home points presented at the beginning of this blog.  Contact Susan at 305-279-4740 for a complimentary consultation on international trademark registration strategy.  We liaise with law firms abroad to protect our clients rights on an international basis.

THANK YOU FOR YOUR INTEREST IN THIS BLOG.  AS USUAL THE CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT LEGAL ADVICE.

© 2023 by Troy & Schwartz, LLC

 

 

 

 

  • Comments Off on INTERNATIONAL TRADEMARK REGISTRATION STRATEGY AFTER SCOTUS’S DECISION IN ABITRON AUSTRIA v. HETRONIC INTERNATIONAL
  • Add Comment
Jul
02

WHAT’S UP WITH THE SUSSEXES AND THEIR REJECTED TRADEMARK APPLICATION FOR THE WORD MARK ARCHETYPES?

Recently, numerous news publications have rather gleefully reported that the Sussexes (a/k/a Harry and Meghan) intent-to-use trademark application for the word mark ARCHETYPES has been rejected by the USPTO due to the likelihood of confusion with a previously registered mark.  The rejection has been viewed by many as a deserved comeuppance for the couple’s actions since leaving England’s royal family.

Quite apart from one’s personal opinions of the Sussexes, trademark law is trademark law.    This blog discusses the USPTO’s rejection of the ARCHETYPES mark to emphasize the factors that the examining attorney relied on to reach her likelihood of confusion conclusion.  The rationale for her rejection is instructive for those who are considering seeking registration of a trademark which is very similar to already existing registered mark(s).   In particular, it is important to note that the applicant’s and registrant’s specified goods/services need not be identical for a likelihood of confusion finding by the USPTO.

  1. Actual Status of the Application

The news headlines have not been totally accurate regarding the status of the ARCHETYPES mark.  The USPTO has issued only an initial rejection, not a final rejection of the mark.  The initial rejection was on January 18, 2023.  The applicant has until July 18th to respond to the initial rejection.  If the USPTO’s examining attorney finds that the response overcomes her initial rejection, the application will receive a Notice of Allowance.  After filing a Statement of Use which meets the USPTO’s requirements, the mark will then be registered.

On the other hand, if the examining attorney issues a final rejection, Archewell Audio will have the right to appeal the USPTO’s decision to the Trademark Trial and Appeal Board (TTAB ) and/or through federal courts of law.  It is noted that the Trademark Trial & Appeal Board’s (TTAB) affirmance rate of examining attorneys’ final rejections is 95%.   Accordingly, Archewell Audio will likely have a difficult road ahead to obtain registration of the ARCHEWELL mark.

  1. The Lack of the Applicant’s Verification Signature in the Application

The application, filed by an attorney, was cited by the examining attorney for being unsigned.  As such, neither Archewell Audio’s authorized representative nor its attorney ever verified certain statements that must be verified in every application.  Why not?  This failure is an example of sloppiness on the part of the attorney representing Archewell Audio. Either that or Archewell Audio’s authorized representative or its attorney (based on personal knowledge) was unwilling to attest to the following:

The applicant has a bona fide intention to use the mark in commerce and had a bona fide intention to use the mark in commerce as of the application filing date; the applicant believes applicant is entitled to use the mark in commerce on or in connection with the goods and service specified in the application; that to the best of the signatory’s knowledge and belief, no other persons, except, if applicable, concurrent users, have the right to use the mark in commerce either in the identical form or in such near resemblance as to be likely, when used on or in connection with the goods/services of such persons, to cause confusion, mistake, or to deceive, and that the facts set forth in the application are true.

  1. The Examining Attorney’s Likelihood of Confusion Analysis

Archewell Audio’s application (SN 97332048) included lengthy listings under both: 1) Class 9 for downloadable audio recordings, podcasts, webcasts, all in the fields of cultural treatment of women and stereotypes facing women; and Class 41 for entertainment service, namely, an ongoing podcast series in the field of cultural treatment or women and stereotypes facing women.

In finding likelihood of confusion, the examining attorney relied on registration no. 5481385, also for the mark ARCHETYPES.  The registration date was May 29, 2018 and its first use in commerce was in 2012.  The registration specifies services under Class 41: Providing a website featuring blogs and non-downloadable publications in the nature of articles in the field(s) of nutrition, fitness, sexuality, psychological self-improvement, personality identification and matching, personal relationships and dating, spiritually, horoscopes, and astrology, fashion, music, and reviews and recommendations for books.

A.  The Two Marks are Commercially Identical.

The examining attorney first compared the marks, finding them to be identical in nature and in commercial impression.  Accordingly, the marks were found to be confusedly similar just in looking at them, thereby engendering the same connotation and overall commercial impression.  This means that consumers would be confused as to just who is providing the goods and/or services – the applicant or the registrant.

B.  Archewell Audio’s Services Encompass the Registrant’s Services.

Next, the examining attorney compared the goods/services to determine whether they are similar, commercially related, or travel in the same trade channels.  Under trademark law, it is important to understand that the goods and/or services need not be identical or even competitive to find a likelihood of confusion.   Importantly, they need only be “related in some manner and/or if the circumstances surrounding their marketing are such that they could give rise to the mistaken believe that the goods and or services emanate from the same source.”

The examining attorney noted the broad wording of Archewell Audio’s application to describe podcasts, downloadable and pre-recorded goods in Class 9 as well as ongoing podcast series, television series, and related services in Class 41.  She concluded that the reference to services in the “fields of cultural treatment of women stereotypes facing women” encompasses all of the goods and services of the types described for the registered mark in the field of sexuality, personality, identification, personal relationships, dating, spirituality, and related topics.   This is so even though the registered mark is for blogs and non-downloadable publications but not podcasts.

C.  Podcasts and Blogs May Emanate from a Single Source Under a Single Mark Thereby Leading to Confusion.

Here, the examining attorney relied on third-party registrations to establish that blogs and podcasts on issues facing women are of a kind that may emanate from a single source under a single mark.  The examining attorney did not interpret Archewell Audio’s reference to “cultural treatment of women and stereotypes facing women” as sufficient to distinguish its goods/services from the registrant’s services.

Additionally, the examining attorney provided evidence to establish that today it is common for bloggers to produce podcasts.  This means that the same entity commonly produces or provides the relevant goods/services (podcasts/blogs) and markets the goods/services under the same mark.  Accordingly, Archewell Audio’s and the registrant’s goods are considered related for likelihood of confusion purposes.

  1. Conclusions

It is not known whether Archewell Audio actually conducted a trademark search prior to filing the application to evaluate non-registration risks.  If not, why not?  Did their attorney provide any cautionary guidance?  If so, perhaps the attorney and her clients thought that the specific reference to the cultural treatment of women and stereotypes facing women would be sufficiently limiting to overcome a likelihood of confusion analysis with registration no. 5481385 for the same mark.   Also that podcasts and blogs are not related goods. The examining attorney concluded otherwise for the reasons discussed above as supported by numerous TTAB and court decisions.

The above discussion shows that there is much more to a likelihood of analysis than meets the eye, especially where the applied-for mark provides the same overall commercial impression. It is also important to understand how technology can “transform” a good/service into a more modern version of the good/service.  For example, blogging transformed the content communication highway.  No longer is content reserved for written publications such as hard-copy journals or magazines.  And thanks to platforms such as Spotify and Apple, podcasts are now hugely popular.   Consistent with the examining attorney’s opinion that a blogger is often a podcaster, the author receives emailed blogs from some her favorite podcasters.

Also puzzling is the fact that Archewell Audio’s application was not properly signed.  Why not? It is not clear how the USPTO even accepted an unsigned application through its electronic filing system.  The author has never filed an unsigned/unverified application.  Procedures are in place for electronically sending the application to the applicant’s authorized representative for the verification signature.

  1. Where Do the Sussexes Go From Here?

Whether or not the mark is approved for registration remains to be seen presuming a response to the examining attorney’s office action is filed.   Based on the likelihood of analysis factors relied on by the examining attorney as discussed above, it appears that registration of the Sussex’s ARCHETYPES mark is highly unlikely.  If a response is not filed, the application will become abandoned.

One option available to Archewell Audio is to seek a consent or coexistence agreement with the owner of the registered mark, an Arizona limited liability company.  If the registrant agrees, the USPTO will still need to approve the agreement before granting registration.   Click here for a blog on requirements for such an agreement from the USPTO’s perspective.

Finally, since their application was filed, Spotify has cancelled the Archetypes podcast.  If the USPTO grants a Notice of Allowance on this intent-to-use application, Archewell Audio will need to demonstrate the mark is in use to progress to actual registration of the mark.

In Need of Legal Counsel on Trademark Matters?

Trademark law is a complex area of the law.  Contact Susan at 305-279-4740 for a complimentary consultation on all trademark law matters from registration to matters before the Trademark Trial & Appeal Board to enforcing your trademark rights in court.

 

Thank you for your interest in this blog.  As usual the content is for informational purposes only and is not legal advice.   


© 2023 by Troy & Schwartz, LLC

 

 

 

 

  • Comments Off on WHAT’S UP WITH THE SUSSEXES AND THEIR REJECTED TRADEMARK APPLICATION FOR THE WORD MARK ARCHETYPES?
  • Add Comment
Posted in Uncategorized on July 02,2023 09:07 PM
May
31

THE HARD ROCK HOTEL AND CASINO’S GUITAR-SHAPED HOTEL AND CASINO IS GRANTED TRADEMARK PROTECTION AS BEING INHERENTLY DISTINCTIVE TRADE DRESS 

Key Points: 

  1. Product packaging and product design may qualify for trademark protection as trade dress. However, different sections of the Lanham Act apply.
  2. Product packaging may be granted trademark registration under the Lanham Act on inherently distinctive grounds if the other requirements for trademark registration are met.
  3. A product design may be granted trademark registration under Section 2f of the Lanham Act on the basis of widespread public recognition (i.e., acquired distinctiveness) over a period of years if the other requirements for trademark registration are met.
  4. The Trademark Trial & Appeal Board held that the Guitar-Shaped hotel/casino qualifies for trademark protection as being inherently distinctive because it is akin to product packaging and the shape is unique in the “hotel and casino” services industry.

Discussion

Registered trademark protection is routinely sought for brand names,  logos, and slogans.  A less well-known but still powerful type of trademark protection involves trade dress.  The Lanham Act protects trade dress if it serves as the same-source identifying function as a trademark.   Trade dress is defined as the design and shape of the materials in which a product is packaged.  The design and shape of the product itself may also be considered a form of trade dress.

Depending upon the circumstances, trade dress may be granted trademark registration if it is inherently distinctive on its “face.”  Section 2f of the Lanham Act applies where a generally-not-protectable trademark has acquired trademark protection eligibility (secondary meaning) due to widespread public recognition of the mark as a brand and/or with the long and continuous use of the mark.

Those readers who live in South Florida or have visited the area have likely driven by or even visited the Seminole Tribe’s Hard Rock Hotel and Casino with its guitar-shaped facilities.  On May 25, 2023,  in In re Seminole Tribe of Florida, the Trademark Trial and Appeal Board (TTAB), in a precedential opinion, held that the Tribe’s three-dimensional building in the shape of a guitar (part of the Tribe’s Hardrock Casino and Hotel) is inherently distinctive.  The building’s shape is thus eligible for trademark registration for the Tribe’s casino services under international classification (IC) 41 and hotel, restaurant, and bar services under IC 43.   Application SN 87890892, available at www.uspto.gov, describes the mark as a “three-dimensional building in the shape of a guitar” and includes a black and white drawing.

In finding in favor of the Tribe, the TTAB relied on the U.S. Supreme Court’s decisions in Two Pesos, Inc. v. Taco Cabana, Inc. and Walmart Stores v. Samara Bros.  Both cases were trademark infringement lawsuits involving unregistered trade dress marks. Two Pesos involved an infringement lawsuit for the usage of Taco Cabana’s distinctive trade dress featuring the décor of a Mexican restaurant.   The Supreme Court held the “proof of secondary meaning is not required to prevail on a claim in an action for infringement of unregistered trade dress under § 43(a) of the Lanham Act where the trade dress at issue is inherently distinctive. . .”   Taco Cabano’s trade dress was found to be inherently distinctive and subject to protection as a common law trademark.

In Wal-mark Stores, the Supreme Court further clarified its trade dress jurisprudence by distinguishing “product design” trade dress from “product packaging” trade dress.  Here, Samara Brothers sued Wal-mart for selling knockoffs of the plaintiff’s garments, a line of spring and summer one-piece seersucker outfits featuring decorative appliques.   The Court found that the garments represented “product design” trade dress wherein a product’s design is distinctive, and therefore protectable, only upon a showing of secondary meaning.”  In reaching its decision, the Court distinguished the “product packaging” trade dress or “tertium quid” at issue in Two Pesos, from the “product design” trade dress at issue in Samara Bros.  The Samara Court further stated that the décor trade dress in Two Pesos is either product packaging, which is normally taken by the consumer to indicate origin, or some tertium quid that is akin to product packaging and has no bearing on the present case.

The distinction between product design and product packaging makes sense on the basis of trademark law’s consumer-focused purpose. As Justice Scalia stated in the Samara opinion:

It seems to us that [product] design, like color, is not inherently distinctive.  The attribution of inherent distinctiveness to certain categories of word marks and product packaging derives from the fact that the very purpose of encasing it in distinctive packaging, is most often to identify the source of the product.  Although the words and packaging can serve as subsidiary functions . . . their predominant function remains source identification.  Consumers are therefore predisposed to regard those symbols as indication of the producer, which is why such symbols “almost automatically tell a customer that they refer to a brand,” . . . and “immediately signal a brand or a product source. . . .”

In re The Seminal Tribe at 11 quoting Samara.

In finding for the Seminole Tribe, the TTAB held that the Guitar Design is akin to product packaging and inherently distinctive for the services specified in the application. The TTAB also emphasized that trademark eligible trade dress must be unique in the relevant industry, in this case the hotel and casino industries.  Here, the TTAB cited its 2015 decision in In re Frankish Enters. Ltd. which involved the trade dress of the “fanciful, prehistoric animal design” of the cab of monster truck exhibitions.  Finding that the monster design was akin to product packaging and therefore inherently distinctive, the Frankish Enters. Board also emphasized the uniqueness of the applicant’s monster truck design which was readily distinguishable from all other monster truck designs of record.   In re Seminole Tribe of Florida at 16.  Similarly, the uniqueness of the Guitar Design in the hotel and casino service industries makes it inherently distinctive on its face.

Side Note:  The examining attorney had approved registration of the guitar-shaped hotel under Section 2f but the Seminole Tribe sought registration on inherently distinctive grounds rather than on acquired distinctiveness grounds.  Either way, in this particular case, the distinctive shape of the hotel clearly made it eligible for both types of registration.  There may be some strategic legal reasons for seeking registration of  product-package trade dress involving an obviously inherently distinctive design even where 2f registration would be granted.  Trademark attorneys should discuss such strategies with the client since appeals do cost money.  In another May 2023 hotel trade dress case, the TTAB held that a rectangular-shaped hotel could not be registered even on 2f’s acquired distinctiveness grounds. .  In re Palaci Del Rio, IncSee application SN 88412764 for a drawing of the hotel.  A comparison between The Seminole Tribe’s guitar-shaped hotel and the rectangular-shaped hotel clearly demonstrates why the Seminole Tribe’s hotel was accorded protection as being inherently distinctive.

In conclusion, trade dress is another avenue for obtaining trademark protection and building brand recognition.  One thing to note, however, is that trademark registration will not be granted if the trade dress has an associated  functionality.   Click here for a blog on trade dress and functionality entitled “From Medical Test Tube Caps to Bourbon Bottles – Getting a Grip on Trademark Functionality.”

THANK YOU FOR YOUR INTEREST IN THIS BLOG. AS USUAL THE CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND IS NOT LEGAL ADVICE.

Copyrighted 2023

Intellectual property law is a complex area of the law.  Contact us for a complimentary consultation on protecting your inventions, creative works, brands, and proprietary information through patents, copyrights, trademarks, trade dress, and trade secrets or our litigation services involving intellectual property disputes.   We represent both individuals and business entities.  Our mission is to serve innovators and creators in protecting the fruits of their hard work and ingenuity through our Client Services Creed:  Conscientious, Rigorous, Energetic, Empathetic, and Diligent legal services. 

 

 

  • Comments Off on THE HARD ROCK HOTEL AND CASINO’S GUITAR-SHAPED HOTEL AND CASINO IS GRANTED TRADEMARK PROTECTION AS BEING INHERENTLY DISTINCTIVE TRADE DRESS 
  • Add Comment
Close Bitnami banner
Bitnami