Copyright & Trademark: Intellectual Property
Source of IP Law:
§ 43(a) / 1125
Intellectual Property Law in Context
The Sources and Limits of Intellectual Property
· United States Constitution – Article 1, § 8
o cl 3: To regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes….(trademark) (does not speak to duration)
o cl 8: Congress shall have the power “to promote the Progress of Science (copyright) and useful Arts (patent), by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries…”
· Critical Date: 1/1/1978 (state and common law copyright rights no longer exist)
· Critical Date: 2/15/72 (phonorecords receive federal protection)
CASE: Eldred v. Ashcroft: Congress Term Extension Act (CTEA) enlarged the duration of copyrights by 20 years (50 years to life + 70 years). 10/27/98: CR needed to be valid on that date. Sonny Bono Act. Maintain our obligation to the Global Community. Petitioners – individuals and businesses whose products or services build on copyrighted works that have gone into the public domain. Petitioners argue that Congress did not have the power to extend the duration of copyrights because the “limited Times” language drawing a clear line beyond the power of Congress to extend. Held: Congress acted within its authority and did not transgress constitutional limitations through the CTEA and the Copyright Clause empowers Congress to define the scope of the substantive right; and its extension of existing and future copyrights does not violate the First Amendment but rather supplements traditional First Amendment safeguards
State Law of Intellectual Property
· Idea Protection (Balance of Interest)
o Creator: Whose Idea was it?
§ Venture Capitalist
§ Public Access
Rights in Undeveloped Ideas
· A call comes in to you, what are your steps?
o Is there a conflict of interest
o Money up front, money up front, money up front
CASE: Sellers v. American Broadcasting Co.(ABC): Sellers has a theory for Presley’s death and wants to report to Geraldo Rivera and ABC for money. Recovery permitted for the misappropriation of an idea or theory if:
· The idea is novel (not know to others)
· The idea is in concrete form (best form is written detail)
· The defendant makes use of the idea
· Expectation of Payment
· Court concludes that Seller’s theory was neither novel, unique nor original; that his theory was too vague to be sufficiently concrete
Rule: Broad, general story ideas may not form the basis of a copyright infringement action.
· Misappropriation: The unlawful use of another’s property or funds.
· Infringement: Conduct in violation of statute or that interferes with another’s rights pursuant to law.
· Contracts and Idea Protections
o Claims brought on:
§ Theory of breach of express contract
§ Theory of breach of implied contract
§ Theory of breach of quasi-contract
§ Breach of Confidentiality
§ Tort of Conversion
Theories of Protection
· Idea Protection: There are elements needed to establish that an idea is exclusive.
CASE: Lueddecke v. Chevrolet Motor Co.: Lueddecke brings action to recover on an alleged implied contract on the part of the defendant companies to pay plaintiff the reasonable value of an idea and suggestion which he alleges he furnished to them. Held: Defendants not indebted to the plaintiff because they did not offer to make any agreement to pay for such mere suggestion as the plaintiff made, and their correspondence did not invite such suggestion. Rule: A party is not legally liable for incorporation unsolicited generalized suggestions into its product.
· Proprietary Interest: An owner’s interest and rights in property.
CASE: Nadel v. Play-By-Play Toys & Novelties, Inc.: Thrust of Nadel’s complaint was that Play-by-Play took his idea for an upright, sound-emitting, spinning plush toy and that contrary to industry custom, Play-by-Play used the idea in its “Tornado Taz” product without paying him compensation. Play-by-Play responded with claims that they did not use Nadel’s idea and states that even if they did use Nadel’s idea to develop Tornado Taz, Nadel is not entitled to compensation because Nadel’s concept was unoriginal and non-novel to the toy industry in October 1996. District court (lower court) ruled that Nadel’s idea was not novel because numerous toys containing the characteristics of Nadel’s monkey were in existence prior to October 1996. Because of the timing of Play-by-Play’s development and release of Tornado Taz in relation to Nadel’s October 1996 disclosure, the Court of App. Remanded the case because a genuine issue of material fact as to whether Nadel’s idea was novel existed. Idea was novel to the particular company. Novel to Recipient (Buyer). Rule: A showing of genuine novelty or invention may sustain claims for breach of contract, quasi-contract and unfair competition.
· Concreteness: The law shies away from according protection to vagueness, and must do so especially in the realm of ideas with the obvious dangers of a contrary rule.
· Novelty: Specificity, Commonality, Uniqueness and Commercial Availability.
· Yadkoe v. Fields (Note Case): W.C. Fields case. Breach of Implied Contract.
Limits of Protection: The Place of Ideas in the Competitive Plan
CASE: Aronson v. Quick Point Pencil Co.: USSC. Aronson had a unique key holder design that she contracted with Quick Point Pencil to sell: (1) She would get 5% for royalty if patent was approved (2.5% if not approved). Patents during this time were for 17 years. Aronson did not receive patent but Quick Point doesn’t want to pay 2.5% royalties anymore (did for 14 years). Patent Policy: (1) Patent law seeks to foster and reward invention; (2) Promote disclosure of inventions to stimulate further innovation and to permit the public to practice the invention once the patent expires; (3) The stringent requirements for patent protection seek to assure that ideas in the public domain are there for the free use of the public. Court’s examine initial know-how; fact that Quick Point was able to enter into the market place first is their consideration in the contract. Thus, Quick Point must honor contract until they stop manufacturing the key holder. Royalty tied into advanced knowledge and benefit. Rule: An inventor’s failure to obtain a patent does not preclude enforcement of a contract paying royalties on the invention to the inventor.
· Patent law may only be held to preempt such state laws if enforcement of such laws is antithetical to the purposes of pate
· Unfairness: Exists when the party seeking the injunction has expended time and effort to familiarize the public with its name and product, ad the offending party seeks to exploit that effort.
· Field of protection of trade names is part of the wider domain of the law relating to unfair competition, where the overriding objective is that of commercial fairness.
· If it is demonstrable and clear from the record that the acts of once charged with usurpation of another’s commercial name are actually unfair, equitable principles become operative.
· Secondary Meaning has been defined as the trade meaning which may attach to a particular mark because its user has expended time and money in the promotion of the mark.
o The concept is that a name has become so identified with a particular business that it exclusively signifies only that one particular business.
· Reverse Confusion: They would be confused into thinking that the first user’s goods and services come from the second user.
Theory of Protection: Dilution
· 15 USC §43(c)
· Nabisco Test
· Victoria Secret Case: SC case holding that there must be proof of actual dilution (confusion). More than a likely of economic harm.
· Trademark: Development of a secondary meaning is very important. Not just about the likely of confusion.
· Motorola Test: (1)A plaintiff generates or gathers information at a cost; (2) the information is time-sensitive; (3) a defendant’s use of the information constitutes free riding on the plaintiff’s efforts; (4) the defendant is in direct competition with a product or service offered by the plaintiffs; and (5) the ability of other parties to free-ride on the efforts of the plaintiff or others would so reduce the incentive to produce the product or service that its existence or quality would be substantially threatened.
· Define: The diminishment of the capability of a trademark to identify and distinguish the particular good or service with which it is associated.
CASE: Mead Data Central, Inc. v. Toyota Motor Sales, U.S.A., Inc.: LEXIS v. LEXUS. Court rejects Mead’s argument that LEXIS is a coined mark or unique. Dilution – law allows one to protect their mark from unrelated goods (§43 Lanham Act). Two elements:
· Plaintiff’s mark must possess a distinctive quality capable of dilution
o Distinctiveness is equated with the strength of the mark or its selling mark; criteria for determining whether a mark is distinctive or famous – § 43(c)
§ the degree of inherent or acquired distinctiveness of the mark;
§ the duration and extent of use of the mark in connection with the goods or services with which the mark is used;
§ the duration and extent of advertising and publicity of the mark;
§ the geographical extent of the trading area in which the mark is used;
§ the channels of trade for the goods or services with which the mark is used;
§ the degree of recognition of the mark in the trading areas and channels of trade used by the marks’ owner and the person against whom the injunction is sought;
§ the nature and extent of use of the same or similar marks by third parties; and
§ whether the mark was registered under the Act of March 3, 1881, or the Act of February 20, 1905, or on the principle register
· Plaintiff must show proof of actual dilution (Moseley) (NY: proof of likely confusion).