Tag Archives: trademark



April 6 / Trademark

B&B Hardware v. Hargis: Decision and Impact

By: Jonathan Hu

On March 24, 2015, the Supreme Court of the United States reversed the Eight Circuit’s decision and ruled that issue preclusion applies in B&B Hardware v. Hargis Industries, Inc.[1] Justice Alito delivered the majority opinion for the Court, in which he was careful to limit the holding to only certain trademark infringements. Justice Ginsburg filed a concurrence, while Justices Thomas and Scalia dissented.

Background:

The Petitioner, B&B Hardware, Inc. (“B&B”), manufactures and sells self-sealing fasteners in the aerospace industry. B&B registered the mark “SEALTIGHT” in 1993. The Respondent, Hargis Industries, Inc. (“Hargis”), also manufactures and sells fasteners, but in the construction industry. Hargis attempted to register the mark “SEALTITE” in 1996, but B&B opposed the application and sued Hargis for infringement. The Trademark Trial and Appeal Board (“TTAB”) determined that there was a likelihood of confusion between the two marks and thus denied Hargis’ application. In contrast, a jury trial in 2000 found B&B’s mark to be merely descriptive and that it had not acquired a secondary meaning. This finding was further upheld by the Eighth Circuit in 2001.[2] However, when the TTAB took up Hargis’ petition to cancel B&B’s mark in 2001, the TTAB dismissed the petition in 2003. The TTAB also denied a subsequent attempt by Hargis to register “SEALTTIE” in 2007.[3]

In 2003, B&B filed a second infringement suit against Hargis. The Eastern District Court of Arkansas dismissed this suit in 2007 on the grounds that the first infringement suit precluded the second one.[4] However, the Eighth Circuit reversed this decision in 2009 on the grounds that the prior case did not address the issue of likelihood of confusion.[5] On remand, a jury found no likelihood of confusion between “SEALTIGHT” and “SEALTITE”. In response, B&B sought a new trial because the district court refused to give preclusive effect, or even deference, to the TTAB’s likelihood of confusion finding. The district court denied the motion.[6] The Eighth Circuit affirmed and reasoned that the TTAB did not decide the same likelihood of confusion issue that was presented to the district court.[7]

The Supreme Court granted a writ of certiorari on July 1, 2014[8] and heard the case on December 2, 2014.

Decision:

The Court found that issue preclusion applied because the same likelihood-of-confusion applied to both registration and infringement in this case.[9] While the TTAB may have focused on different factors in its analysis, compared to the district court, the case turned on whether the same standard to the usage was applied. Here, the Court determined the same standard was applied for three reasons. First, the operative language is essentially the same. Second, the likelihood-of-confusion language that Congress used these Lanham Act provisions has been central to trademark registration. Third, district courts can cancel registrations during infringement litigation, just as they can adjudicate infringement in suits seeking judicial review of registration decisions. The Court found no reason to think that the same district court judge should apply two separate standards for likelihood of confusion.

Dissent:

Justice Thomas’ dissent was focused on the broader issue of giving administrative agencies the power to preclude issues from Article III courts. The dissent examined the genesis of the majority opinion’s precedence and found the dicta both unpersuasive and troubling. Justice Thomas concluded that to presume administrative agencies have the power to preclude issues from Article III courts, and apply it to adjudication in a private-rights dispute, would raise serious constitutional questions.

Justice Alito’s opinion sidesteps Justice Thomas’ dissent. Justice Alito noted in footnote 2 that the Court was not specifically deciding the issue of administrative agencies having the power to preclude issues from Article III courts. This was because neither party challenged this foundation. In theory this leaves the topic open for future debate. However, the Court’s 7-2 opinion in this case noted that until Congress clarifies otherwise, administrative agencies will continue to have the opportunity to decide and thereby preclude certain issues from future re-litigation.

Impacts:

There are various ramifications from this case.

First, the decision does not cover every instance of the TTAB’s findings for a likelihood of confusion. Justice Ginsburg’s concurrence specifically highlighted that the Court’s opinion for issue preclusion does not apply to all instances because contested registrations are often decided upon a comparison of the marks in the abstract and apart from their marketplace usage. When the registration proceeding is of that character, there will be no preclusion of the likelihood-of-confusion issue in a later infringement suit.

Second, parties will take more care when litigating in front of the TTAB. “While the TTAB cannot award damages or find infringement, its decisions could now be used as grounds for finding infringement in District Court.”[10]  This may specifically impact how evidence is presented by parties to the TTAB because of the Court’s focus on how the comparison and evidence presented to the TTAB may determine when preclusion is appropriate.[11]

Lastly, “prior to this decision, if a case was simultaneously pending in the District Court and before the TTAB, the TTAB would readily stay its determination until the litigation in District Court was resolved.”[12] With the Court’s affirmation that issue preclusion may apply from the TTAB’s decisions, this may no longer be the case.

 


 

[1] B&B Hardware, Inc. v. Hargis Industries, Inc., 113 U.S.P.Q.2d 2045.

[2] B&B Hardware, Inc. v. Hargis Industries, Inc., 252 F.3d 1010 (8th Cir. 2001).

[3] B&B Hardware, Inc. v Sealtite Building Fasteners, 2007 WL 2696310, at *12-13 (2007).

[4] B&B Hardware, Inc. v. Hargis Industries, Inc., 2007 WL 2711647 (E.D. Arkansas 2007).

[5] B&B Hardware, Inc. v Hargis Industries, Inc., 569 F.3d 383, 390 (8th Cir. 2009).

[6] B&B Hardware, Inc. v. Hargis Industries, Inc., 736 F.Supp.2d 1212 (E.D. Arkansas 2010).

[7] B&B Hardware, Inc. v. Hargis Industries, Inc., 716 F.3d 1020, 1024 (8th Cir. 2013).

[8] B&B Hardware, Inc. v. Hargis Industries, Inc., 134 S.Ct. 2899 (2014).

[9] B&B Hardware, Supra 1.

[10] Munro, John E., B&B Hardware, Inc. v. Hargis Industries, Inc.: Trademark Litigation Might Get Simpler, National Law Review, (March 27, 2015), http://www.natlawreview.com/article/bb-hardware-inc-v-hargis-industries-inc-trademark-litigation-might-get-simpler.

[11] See Little, Trevor, US Supreme Court decision means that TTAB proceedings just got more important, World Trademark Review, (March 25, 2015), http://www.worldtrademarkreview.com/blog/detail.aspx?g=6d2aef4b-31a5-4528-b712-b31a1d456973.

[12] Munro, John E., Supra 10.

March 30 / Trademark

Hana Financial, Inc. v. Hana Bank

By: Brianna Nassif 

The Supreme Court granted certiorari in 2014 in the Ninth Circuit case Hana Fin., Inc. v. Hana Bank.[1] The case involves two Korean-based financial institutions.[2] It addressed a circuit split on the question of whether trademark priority established by trademark tacking is a question for the jury.[3] This article will examine the court’s discussion of the appropriate legal standard to be applied in tacking cases, and the potential broader implications of this decision in other trademark matters.

Legal Background:

Questions of trademark rights and priority are generally settled by determining which party was the first to use the mark. This analysis can be complicated, though, by trademark tacking. Trademark tacking allows a mark owner to “tack” its use of a revised mark to its use of its original mark for purposes of establishing priority.[4] This narrow doctrine requires the court to determine whether the original and revised marks create a “continuing commercial impression” and are thus “legal equivalents.”[5] Neither party in this case disputes the tacking doctrine or its legal standard; rather, the issue is whether the judge or the jury should determine whether tacking applies.

Facts and Procedural History:

Hana Financial, the petitioner, was established in 1994 and registered its mark in 1996. Hana Bank, the respondent, was established in Korea in 1971 as the Korea Investment Finance Corporation. It changed its name to Hana Bank in 1991. The American branch of the company was established in 1994 and was named Hana Overseas Korean Club. US advertisements used the Hana Overseas Korean Club name in both Korean and English. They also used the words “Hana Bank” in Korean. In 2000, the name was changed to Hana World Center before being established as Hana Bank in 2002. In 2007, Hana Financial sued Hana Bank for trademark infringement. Hana Financial contended that the word “Hana” used by two financial entities was likely to cause confusion.[6]

Hana Bank’s defense in the infringement case was that it had established priority through trademark tacking. Under this theory, Hana Bank argued that it could “tack” the Hana Bank mark to its original Hana Overseas Korean Club mark established in 1994, thus establishing priority over the Hana Financial mark.[7] The District Court agreed and granted Hana Bank’s motion for summary judgment. On appeal, the Court of Appeals for the Ninth Circuit found that there were questions of fact in the case and reversed and remanded it. In a jury trial in the District Court, the jury determined that the tacking defense applied and decided for Hana Bank. The Ninth Circuit Court of Appeals affirmed and Hana Financial appealed to the Supreme Court of the United States.

Ninth Circuit Appeal:

The Ninth Circuit opinion provided an overview of the tacking defense and its applications. The court relied on its previous decision in Brookfield Commc’ns, Inc. v. W. Coast Entmt. Corp. to explain the tacking analysis.[8] The court reiterated that tacking is permitted so as to encourage mark owners to apply minor alterations to their marks to reflect changing consumer demands and preferences.[9] Without this doctrine, mark owners would be punished for even slightly changing their marks because the clock would reset and they could lose priority.

In determining whether there is a commercial impression, the court explained that the perspective of the ordinary consumer of these kinds of goods and services should be used.[10] The main tools used to establish this standard are consumer surveys and the specific facts of the case.[11]

Before getting into the specific facts of this case, the court finally discussed the narrowness of the doctrine and its limited application. It pointed to the higher standard to be applied for legal equivalency compared to the standard used for likelihood of confusion and works through many examples where the doctrine did not apply.[12] Despite this narrow interpretation of the doctrine, the court concluded that “here, reasonable minds could disagree on whether the Bank’s marks were materially different.”[13] However, because the case was on appeal, Hana Financial, as the losing party in the lower court, would have to show that the evidence would only reasonably support their interpretation. Hana Financial did not reach this high standard.[14] The court properly instructed the jury, and the evidence was sufficient to support a verdict for Hana Bank on tacking.[15]

Supreme Court Appeal:

While the tacking doctrine is narrow, there is a circuit split on whether it is a question of law or fact, with the Federal and Sixth Circuits evaluating the doctrine as a question of law.[16] Justice Sotomayor’s opinion clearly stated that the commercial impression of the mark is a question of fact for the jury because it relates to the perspective of the ordinary consumer.[17]  She specified that a judge can still rule on tacking when cases are being decided for summary judgment or for judgment as a matter of law, but cannot be the decision-maker in a jury trial.[18]

Hana Financial raised four main arguments, each of which was rejected by the unanimous court. The first was that the “legal equivalents” test requires the application of a legal standard, which is usually reserved for the judge. The court recognized Hana Financial’s argument, but explained that mixed questions of law and fact, like this one, generally go to the jury for resolution.[19] The second argument was that tacking decisions “create new law,” which is also usually reserved for judges. Hana Financial did not offer support for this argument, and so the court dismissed it.[20] Its third contention was that allowing juries to answer the tacking question sacrifices predictability of the system. There was no evidence, however, to explain how the decreased level of predictability in tacking is any different from that in a tort, contract or criminal case, so the argument was rejected.[21] The final argument raised by Hana Financial was that judges traditionally were the ones to resolve tacking questions. However, it relied on precedent in which judges decided on summary judgment or judgment as a matter of law, which judges would still retain the authority to decide.[22] For these reasons, the Supreme Court affirmed the Ninth Circuit’s decision for Hana Bank and resolved the circuit split by defining trademark tacking as a question of fact for the jury to decide.

Implications:

Trademark tacking is a narrow doctrine with limited application. While the Supreme Court did not discuss the impact of its decision on other trademark questions, the ordinary consumer impression standard is frequently used in trademark law.[23] For instance, the court applies a similar analysis when determining the likelihood of confusion in infringement cases.[24] Because the Federal, Second, and Sixth Circuits do not treat likelihood of confusion as a pure question of fact, trademark owners in future cases in those courts may argue that the Hana standard should apply and that the question should go to the jury. The Hana Financial case may therefore have broader implications than the narrow tacking doctrine it decided on specifically.

 


 

[1] Hana Fin., Inc. v. Hana Bank, 135 S. Ct. 907, 907 (2015).

[2] Id.

[3] Id.

[4] See generally 1 J. McCarthy, McCarthy on Trademarks and Unfair Competition § 17:26 (4th ed. 2013).

[5] Hana Fin., Inc., 135 S. Ct. at 908.

[6] Hana Fin., Inc. v. Hana Bank, 735 F.3d 1158, 1162 (9th Cir. 2013) cert. granted, 134 S. Ct. 2842, 189 L. Ed. 2d 805 (2014) and aff’d, 135 S. Ct. 907 (2015).

[7] Hana Fin., 735 F.3d at 1163.

[8] See Hana Fin., 735 F.3d at 1164 (citing Brookfield Commc’ns, Inc. v. W. Coast Entmt. Corp., 174 F.3d 1036 (9th Cir. 1999)).

[9] See Hana Fin., 735 F.3d at 1164.

[10] See id.

[11] See id.

[12] See id. at 1165.

[13] Id. at 1166.

[14] Hana Fin., 735 F.3d at 1166.

[15] Id.

[16] Hana Fin., Inc., 135 S. Ct. at 907 (2015).

[17] See id. at 911.

[18] Id.

[19] Id.

[20] Id. at 912.

[21] Id. at 909.

[22] Id.

[23] See Carlo F. Van den Bosch, Supreme Court Update – Hana Financial v. Hana Bank, The National Law Review (Feb. 5, 2015), http://www.natlawreview.com/article/supreme-court-update-hana-financial-v-hana-bank.

[24] See Supreme Court’s Trademark Tacking Decision: Possible Impact on Likelihood of Confusion, Morgan, Lewis & Bockius (Jan. 22, 2015), http://www.morganlewis.com/pubs/supreme-court-s-trademark-tacking-decision-possible-impact-on-likelihood-of-confusion?p=1#_ftn8.

February 3 / Trademark

B&B Hardware, Inc. v. Hargis Industries, Inc.

B&B Hardware, Inc. v. Hargis Industries, Inc.

 By: Jonathan Hu

On December 2nd of 2014, the Supreme Court heard oral arguments for B&B Hardware v. Hargis Industries, Inc. The case represented the conclusion of a long legal battle between the two parties and was the Court’s first review of trademark law in more than a decade.[1]

Background:

The Petitioner, B&B Hardware, Inc. (“B&B”), manufactures and sells self-sealing fasteners in the aerospace industry. B&B registered the mark “SEALTIGHT” in 1993. The Respondent, Hargis Industries, Inc. (“Hargis”), also manufactures and sells fasteners, but in the construction industry. Hargis attempted to register the mark “SEALTITE” in 1996, but B&B opposed the application and sued Hargis for infringement. The Trademark Trial and Appeal Board (“TTAB”) determined that there was a likelihood of confusion between the two marks and thus denied Hargis’ application. In contrast, a jury trial in 2000 found B&B’s mark to be merely descriptive and that it had not acquired a secondary meaning. This finding was further upheld by the Eighth Circuit in 2001.[2] However, when the TTAB took up Hargis’ petition to cancel B&B’s mark in 2001, the TTAB dismissed the petition in 2003. The TTAB also denied a subsequent attempt by Hargis to register “SEALTTIE” in 2007.[3]

In 2003, B&B filed a second infringement suit against Hargis. The district court dismissed this suit in 2007 on the grounds that the first infringement suit precluded the second one.[4] However, the Eighth Circuit reversed this decision in 2009 on the grounds that the prior case did not address the issue of likelihood of confusion.[5] On remand, a jury found no likelihood of confusion between “SEALTIGHT” and “SEALTITE”. In response, B&B sought a new trial because the district court refused to give preclusive effect, or even deference, to the TTAB’s likelihood of confusion finding. The district court denied the motion.[6] The Eighth Circuit affirmed and reasoned that the TTAB did not decide the same likelihood of confusion issue that was presented to the district court.[7]

The Supreme Court granted a writ of certiorari on July 1st, 2014.[8]

Issues:

Two issues were granted and presented to the Court:

  • Whether the TTAB’s finding of a likelihood of confusion precludes respondent from re-litigating the issue in infringement litigation, in which a likelihood of confusion is an element; and
  • Whether if issue preclusion does not apply, the district court was obliged to defer to the Board’s finding of a likelihood of confusion absent strong evidence to rebut it.

Hearing:

The Supreme Court heard oral arguments on December 2­, 2014.  A few specific lines of questioning arose from the Court.

  • Differences between the TTAB and the US District Court
  • What is at stake?

Justice Ginsburg started the questioning by asking Petitioner whether the stakes are different between the two sessions and essentially if this was by design. She noted that the Second Restatement of Judgments allows for administrative judgments to be confined to specifically agreed issues and not be preclusive. The goal of this is to encourage expeditious trials and avoid having parties being bogged down by pretrial preparations. She highlighted this by noting that it was one thing to deny someone a trademark and another to disallow any use of it at all because of infringement.

Petitioner responded by arguing that the inquiry was ultimately the same in both, albeit different issues.  Petitioner then analogized the issue of confusion as a factual one, akin to priority that the TTAB may determine and could be thereafter precluded from being re-litigated. Ultimately, even if the stakes may be different between the TTAB and the district court, the issue being analyzed would be the same.

Respondent also forwarded the interesting argument that the issues at stake with the TTAB and the district court were different.  Respondent argued that the TTAB analyzed “confusing marks” while a district court infringement suit looked at “confusing use.” Justice Scalia, however, was not convinced and inquired the difference between having a trademark applied to a good and a good’s use. Respondent tried to use an example of shoes with a “SIKE” mark, but Justice Scalia remained uncertain, if not unconvinced, that the issue would be limited to confusing use, but not confusing resemblance.

  • What evidence is permitted?

The Court asked all parties about the differences in the proceeding process between the TTAB and the district court. While Petitioner and the Government tried to paint the processes as nearly identical, with insignificant differences, the Court pushed the point home that there were evidentiary limitations with the TTAB. For example, Justice Kagan brought up the fact that an average proceeding cost at the TTAB is only about 10% of that at a district court, and that the TTAB does not allow live witnesses to testify. As for the latter point, Respondent drew from the case at hand, in which the TTAB proceeding only had four depositions and no discovery. In comparison, the district court proceeding had fourteen live witnesses and approximately four-thousand pages of discovery.

The limitations on evidence dovetailed with Justice Sotomayor’s reference to the Court’s holding in Kappos v. Hyatt. The Court held in 2012 that if new evidence was presented on a disputed question of fact, a district court would have to make a de novo factual finding that took account of the new evidence and the administrative record before the Patent and Trademark Office.[9]  As Respondent argued, the evidence that was most crucial for resolution of infringement litigation – the sophistication of consumers – was legally inadmissible before the TTAB.

  • Is there a middle ground of deference?

Lastly, the Court inquired both parties about the possibility of only deference being given in place of preclusion. However, neither party was interested. Petitioner first explicitly made known its preferred position, before concluding that any possible deference should be strong. Respondent likewise argued that any deference would only exist when inquiries were identical between the TTAB and the district court. However, Respondent noted such scenario would never actually happen.

Conclusion

A decision is expected to be delivered around April or May 2015.[10] From initial impressions, it seems that the case is close with the Court leaning in no specific direction.[11] It remains to be seen if the Court is too uncomfortable with deciding any kind of impactful or sweeping decision and will instead produce a limited decision. Indeed, some outside parties are concerned that the decision in this case may affect other legal precedence like Coakwell v. United States and its subsequent progeny.[12]

 


 

[1] Mann, Ronald, Argument preview: Justices will use rare look at trademark law to consider broad and narrow conceptions of trademark, SCOTUSblog, (January 4, 2015), http://www.scotusblog.com/2014/12/argument-preview-justices-will-use-rare-look-at-trademark-law-to-consider-broad-and-narrow-conceptions-of-trademarks/.

[2] B&B Hardware, Inc. v. Hargis Industries, Inc., 252 F.3d 1010 (8th Cir. 2001).

[3] B&B Hardware, Inc. v Sealtite Building Fasteners, 2007 WL 2696310, at *12-13 (2007).

[4] B&B Hardware, Inc. v. Hargis Industries, Inc., 2007 WL 2711647 (E.D. Arkansas 2007).

[5] B&B Hardware, Inc. v Hargies Industries, Inc., 569 F.3d 383, 390 (8th Cir. 2009).

[6] B&B Hardware, Inc. v. Hargis Industries, Inc., 736 F.Supp.2d 1212 (E.D. Arkansas 2010).

[7] B&B Hardware, Inc. v. Hargis Industries, Inc., 716 F.3d 1020, 1024 (8th Cir. 2013).

[8] B&B Hardware, Inc. v. Hargis Industries, Inc., 134 S.Ct. 2899 (2014).

[9] Kappos v. Hyatt, 132 S.Ct. 1690, 1700 (2012).

[10] Israelsen, R. Gregory, Supreme Court hears oral arguments in B&B Hardware, Inc. v. Hargis Industries, Inc., Lexology (January 5, 2015), http://www.lexology.com/library/detail.aspx?g=756f5468-6b16-42df-a8a8-8c9aeaac2edd.

[11] Mann, Ronald, Supra 1.

[12] Englehard, Alexander B. and Charles L. Gholz, Will B&B Hardware v. Hargis Industries Affect Coakwell v. United States?, Intellectual Property Today (January 4, 2015), http://www.iptoday.com/issues/2014/05/will-ub&b-hardware-u-v-uhargis-industries-u-affect-ucoakwell-u-v-uunited-states-u.asp.

October 6 / Archived Posts

Event – Non-Traditional Uses of IP in Product Design – 10/10/12

We will be hosting our first event this coming Wednesday at 12:30 about Non-Traditional Uses of IP in Product Design.

Nicole Rizzo Smith, a lawyer at Ropes & Gray and a BC Law graduate, will join Andrea Rosen, Senior Corporate Counsel and Director of Business and Legal Affairs at PUMA North America, Inc. in Boston to discuss non-traditional uses of IP law used to protect product designs.

We’ll be talking about two recent cases in particular – a Second Circuit case that upheld Louboutin’s right to protect red-soled women’s shoes, and the now infamous Apple v. Samsung, where Apple sued Samsung for infringing its patent on, among other things, the design of its mobile devices.  Professor Joe Liu will serve as moderator of the discussion.

Non-Traditional Uses of IP in Product Design
Wednesday, October 10
Room: TBD
Time: 12:30 P.M.

June 8 / Trademark

The Best Offense Is A Good Defense: How The Washington Redskins Overcame Challenges To Their Registered Trademarks

In 1999, the Trademark Trial and Appeal Board (“TTAB”) decided Harjo v. Pro-Football, Inc., in which a group of Native Americans (the “Petitioners”) alleged that the term “Redskin(s)” was a pejorative, derogatory, degrading, offensive, scandalous, contemptuous, disreputable, disparaging and racist designation for a Native American person; the marks owned by Pro-Football, Inc. (“Pro-Football”), were offensive, disparaging and scandalous; Pro-Football’s use of the marks offended the petitioners and other Native Americans, causing them to be damaged by the continued registration of the marks; the marks consisted of or comprised of matter which disparages Native American persons and brings them into contempt, ridicule, and disrepute; and the marks consist of or comprise of scandalous matter. [1] In a lengthy opinion, the TTAB found that the marks were not scandalous, but they may be disparaging of Native Americans to a substantial composite of this group of people, [2] and therefore ordered that the registrations be canceled in due course. [3]

In September of 2003, the United States District Court for the District of Columbia (the “district court” or the “court”) reversed the TTAB’s decision regarding disparagement in an equally long opinion holding that the TTAB’s finding of disparagement was not supported by substantial evidence and also that the doctrine of laches precluded consideration of the case. [4] This article accordingly focuses on those same two issues, in particular the actual allegations raised by the Petitioners and the relative strengths and weaknesses of those claims; the standard employed by the TTAB and the decision ultimately reached by the TTAB according to that standard; and the TTAB’s reversal by the district court. This article will also posit alternative arguments and viewpoints in addition to assessing the actual effects of this case. Moreover, because the district court did not challenge the standard articulated by the TTAB for evaluating a disparagement claim, [5] whether and how to reconcile laches and secondary meaning may continue to be an issue in the future. Therefore, in the final section of this article, a standard is proposed for analysis of disparagement claims. This standard reconciles tensions and effectively balances laches, “as of the date of registration,” and secondary meaning. It also modifies that part of the standard which articulates what the TTAB and the court concluded was the relevant segment of the population when evaluating disparagement claims. Under the standard proposed, the Petitioners’ claims would be defeated, and Pro-Football’s registrations would be upheld.

 

Lynette Paczkowski*

June 8 / All Articles, Trademark

Been Deep Linked? Apparent Authority Might Link You To Liability

Current trends in trademark law have not met the issue of deep linking with open arms. To date, there is a dearth of cases that touch on deep linking and trademark infringement. Cases such as Ticketmaster Corp. v. Tickets.com dismissed claims of deep linking as trademark infringement with little explanation, simply stating that deep linking itself is not a trademark violation absent “confusion of source.” [1] Yet, there is no case to set the boundaries at the other end of when deep linking would be trademark infringement; it can be implied then that the traditional tests of likelihood of confusion would most likely be applied to find an act of deep linking as trademark infringement.

 

However, the perils do not end for the website owner that is being deep linked from another website and having little means to stop this from occurring. Website owners that are being deep linked can also potentially face liability under the agency theory of apparent authority. Consider the following hypothetical.

 

CELL-X is a popular manufacturer and seller of cellular phones. In addition to distributing and also selling their products through authorized locations and CELL-X company stores, they operate and maintain a website. The website consists of a homepage and interior pages which contain information on the details of the different cellular phone models. Transactions of sales of cellular phones can also occur in the interior web pages of Cell-X’s website; Cell-X states in its purchase web page (and not on any other webpage such as the webpage of each specific model) that purchases via the internet will have an additional 90 days of warranty on top of the standard one year warranty. At the bottom of all the web pages, Cell-X has disclosed the statement, “CELL-X and its logo are registered trademarks.”

 

InterABC is a cellular phone distributor and re-seller. This company sells various brands of cellular phones, including Cell-X, and cellular accessories to the public. However, InterABC is not endorsed, authorized, nor licensed by Cell-X to sell Cell-X brand products. InterABC also operates and maintains a website allowing the internet consumer to browse and purchase the cellular phones InterABC carries. Specifically, InterABC deep links to Cell-X’s interior pages on all Cell-X cellular phone models and products.

 

Consumer Z is in the market to buy fifteen cellular phones for all his family members. By scouring the internet, Z finds InterABC’s website advertising cellular phones for a reasonable price. Z clicks on InterABC’s website hoping to find more information about Cell-X phones and clicks on the link to read more about Cell-X phone model 100A. This page lists the features of model 100A such as a four hour battery life, tri-band mode, a one inch color screen, and an additional one year warranty on top of the original warranty of one year. [2] There is another link that the Z can click on to read even more about model 100A; Z clicks on the link and realizes that the web page he just clicked to open is deep linked to Cell-X’s interior web page for model 100A; this page offers even more technical details of the cell phone such as measurements and accessories. Z is under the belief that InterABC is an authorized reseller of Cell-X products. Z is now quite sure that he wants to purchase Cell-X 100A cellular phones; in addition to the reasonable price that InterABC is selling the phone at, Z notices that buying the phones online comes with an additional one year warranty. Through a secured server, Z inputs his credit card and shipping information, and the cellular phones are subsequently shipped to him.

 

After one and one half years of use, two of Z’s Cell-X 100A phones abruptly stop working. Recalling that since he bought the phones from the internet, he has an additional one-year warranty in order to get them repaired or replaced. However, when trying to contact InterABC, he learns that they have since gone out of business. For Consumer Z, his next reasonable approach would be to contact Cell-X. However, Cell-X cannot honor Z’s warranty claim since it claims that it only offers an additional 90 day warranty. The statement that InterABC made on its website was false, and InterABC is not authorized by Cell-X.

 

The issue then becomes whether Consumer Z can hold Cell-X responsible for warranty claims under apparent authority. Since case law has never considered whether deep linking would ever constitute apparent authority, the next question to ask is whether the traditional cases of case law can shed any light on the issue.

 

Tan Pham*

 

November 5 / All Articles, Computing, Trademark

Why Domain Names Are Not Generic: An Analysis Of Why Domain Names Incorporating Generic Terms Are Entitled To Trademark Protection

Abstract: As the Internet continues to become an everyday part of people’s lives, its widespread use is giving rise to complex and novel legal issues. In particular, trademark law is evolving to meet the rapid pace of the Internet. The legal community is currently analyzing traditional trademark legal principles to determine whether those principles sufficiently address the issues arising in today’s high tech society.

In fact, Internet commerce is the driving force behind much of the evolving trademark law. Arguably, the appeal of the Internet can be attributed primarily to the prevalence of electronic commerce. Many Internet e-commerce companies primarily use their domain name as their company name, service mark, and trademark. For example, drugstore.com is an online pharmacy; homegrocer.com is an online grocery store; vitamins.com is an online nutritional source; and petstore.com is an online pet supply store.

As of the date of this paper, none of the previously listed companies have attained federal registration of their service marks. According to the results of a trademark search conducted on December 17, 1999 using Thomson & Thomson, both DRUGSTORE.COM and VITAMINS.COM are the subjects of pending applications in the United States Patent and Trademark Office (“USPTO”). PETSTORE.COM had not yet filed an application for registration. However, under new office policies, the USPTO may refuse registration to each company’s “domain name trademark” on the grounds that it is generic. [1]

While the USPTO follows traditional trademark law for determining whether any trademark can obtain federal registration, “domain named” companies are provoking much discussion. Under traditional trademark principles, the current policy of the USPTO is to deny registration to a mark consisting of a generic term followed by a Top-Level Domain extension (“TLD”). [2]

This paper will explore the proposition that domain names consisting of arguably generic terms followed by a TLD are still distinctive; therefore, they should still obtain and enjoy some level of trademark protection.

The discussion of this controversial proposition requires an understanding of domain names, traditional trademark principles, and the USPTO’s treatment of domain names as trademarks. Section II provides background information on domain names and traditional trademark principles. Section III discusses the USPTO’s decision to disregard top-level domain extensions when considering whether trademark registration is available to a mark consisting of a domain name. Following this discussion, in Section IV, contrary analysis contends that the USPTO should afford trademark protection to domain names that consist of generic terms combined with a TLD, and examines the levels of protection the law should afford them. Finally, Section V explores the possible alternatives.

 

 

October 11 / All Articles, Trademark

The Trademark Registrability Of The Harley-Davidson Roar: A Multimedia Analysis

If motorcyclists are a unique breed, Harley-Davidson motorcyclists must be considered a cult unto themselves. They have transformed the hobby of motorcycling into a lifestyle, replete with clubs, clothing, and a distinct “biker culture.” [1] The official Harley-Davidson web page describes the Harley history and allure:

 

In 1903, three Davidson brothers and their friend, Bill Harley, started a rumble heard ‘round the world. Their first motorcycle was the start of a unique combination of people and machines. Through the decades, Harley-Davidson motorcycles have had the ability to generate emotion. The excitement of racing, the peacefulness of a ride down a country lane, the pleasant symphony of a handful of bikes rumbling down Main Street, the exhilaration of switchbacks on a mountain road, but most of all, the camaraderie of the people who share the same love for Harley-Davidson motorcycles. The Brotherhood. The Sisterhood. The Family. It’s time to come home. [2]

The Harley-Davidson corporation’s ability to evangelize the Harley lifestyle– as on the company’s website–without alienating a customer-base which prides itself on being free-spirited and countercultural has been a testament to its marketing shrewdness. However, in a business expansion which probably irked the hardcore Harley faithful, the company now manufactures or licenses jewelry, watches, clothing, and a chain of “lifestyle” restaurants called the Harley-Davidson Cafe. [3]

 

In every commercial enterprise Harley-Davidson has undertaken, the company has ensured that the integrity of its trade name and various trademarks in the marketplace is vigilantly protected. Indeed, Harley has successfully litigated trademark infringement cases in federal courtrooms across the country. [4] Interestingly, much of this litigation has taken place within the past five to ten years. This development has a purely economic reason. Since the 1980’s, when the U.S. motorcycle market was dominated by Japanese manufacturers such as Honda, Yamaha and Suzuki, Harley-Davidson has enjoyed a remarkable resurgence of business–to the tune of approximately $1.5 billion in revenues. [5] This cash has enabled Harley to pursue trademark infringers with a renewed zeal.

 

Harley-Davidson’s most recent endeavor to secure trademark protection is not only its most unconventional, it is also arguably, the most unusual and provocative trademark application ever filed with the U.S. Patent and Trademark Office (PTO). On February 1, 1994, Harley filed a registration for a trademark, then already in use, with the following description: “THE MARK CONSISTS OF THE EXHAUST SOUND OF APPLICANT’S MOTORCYCLES, PRODUCED BY V-TWIN, COMMON CRANKPIN MOTORCYCLE ENGINES WHEN THE GOODS ARE IN USE.” [6] Put simply, Harley was attempting to trademark the sound of its motorcycles; which, of course, begs the question, can a manufacturer trademark the exhaust roar of its motor vehicle?

 

Michael B. Sapherstein*