Sitting on Gold Mine

Any moderately successful business most likely has valuable intellectual property that it is may not even be aware it has. A business should, however, be aware of, and inventory, its intellectual property. Why? Several reasons: First, knowing what you have is the first step toward properly protecting it. Second, knowing what you have allows you to document the value of the business when you decide to sell. Second, knowing what you have allows to use the value to attract inventors and obtain financing. Third, knowing what you have allows you to document the value of the business when you decide to sell it.

Where is this intellectual property? It is hidden in the reasons customers continue to deal with the business, and how customers find the goods and services of the business. This checklist can help find it:

  • PRODUCT
    • Does your product have an overall shape that your customers recognize or associate with your business?
    • Does your product have any appearance features that your customers recognize or associate with your business?
    • Does your product have a color or color scheme that your customers recognize or associate with your business?
    • Does your product have a scent that your customers recognize or associate with your business?
    • Does your product have a texture or “feel” that your customers recognize or associate with your business?
  • PACKAGING
    • Does your packaging have an overall shape that your customers recognize or associate with your business?
    • Does your packaging have any appearance features that your customers recognize or associate with your business?
    • Does your packaging have a color or color scheme that your customers recognize or associate with your business?
    • Does your packaging have graphic elements that your customers recognize or associate with your business?
    • Does your packaging have a scent that your customers recognize or associate with your business?
    • Does your product have a texture or “feel” that your customers recognize or associate with your business?
  • LABELING
    • Does your labeling have an overall shape that your customers recognize or associate with your business?
    • Does your labeling have any appearance features that your customers recognize or associate with your business?
    • Does your labeling have graphic elements that your customers recognize or associate with your business?
    • Does your labeling have a color or color scheme that your customers recognize or associate with your business?
    • Does your product have a texture or “feel” that your customers recognize or associate with your business?
  • SERVICES
    • Does your facility have an overall appearance that your customers recognize or associate with your business?
    • Does your facility have particular architectural features that your customers recognize or associate with your business?
    • Does your facility have unique lighting that your customers recognize or associate with your business?
    • Does your facility have unique signage that your customers recognize or associate with your business?
    • Does your facility have unique fixtures that your customers recognize or associate with your business?
    • Do you employ unique service items (e.g., bags, cups, napkins) that your customers recognize or associate with your business?
    • Do your employees were uniforms or particular clothing elements that your customers recognize or associate with your business?
    • Do the vehicles that your employees use have an overall appearance that your customers recognize or associate with your business?
    • Do the vehicles that your employees use have unique appearance features that your customers recognize or associate with your business?
    • Do the tools or equipment that your employees use have a distinctive appearance that your customers recognize or associate with your business?
  • ADVERTISING
    • Does your advertising have a theme that your customers recognize or associate with your business?
    • Does your advertising have a sound or jingle that your customers recognize or associate with your business?
    • Does your advertising have a color or color scheme that your customers recognize or associate with your business?
    • Does your advertising have a graphic element that your customers recognize or associate with your business?
    • Does your advertising feature a character or mascot that your customers recognize or associate with your business?

Overall, consider how do customers identify your products or services from a distance? Do you or your customers have a nickname for your products or your business? What sticks in the minds of your customers about your products or services? These are thing tie your customers to your business, and are things that you should take steps to protect. Your business definitely has intellectual property, are you doing you best to protect and use it?

Plaintiff’s Gonna Lose, Lose, Lose, Lose, Lose

Taylor Swift won a victory today (March 1, 2022) at the Ninth Circuit Court of Appeals, which affirmed last fall’s district court decision dismissing plaintiff Jesse Graham’s suit alleging that Swift’s song “Shake It Off” infringed his song “Haters Gone Hate.” Graham’s song included the lyrics, “Haters gone hate, Haters gone hate, Playas gone play, Playas gone play, watch out for them fakers, they’ll fake you every day,” while Swift’s song had somewhat similar by different lyrics, “Cause the players gonna play, play, play, play, play, play/And the haters gonna hate, hate, hate, hate, hate, hate/  Baby, I’m just gonna shake, shake, shake, shake, shake, shake.”

In dismissing the case in July 2020 the district court found that Graham didn’t respond to most of Swift’s arguments for dismissal, and noted that Graham failed to allege a registered copyright, finding that Graham has only applied for the registration. In affirming the district court, the Ninth Circuit pointed out that Graham failed to address the grounds for dismissal and has therefore waived his challenge to the district court’s order.

Although there are ample reasons to double Swift’s liability, pro se Graham’s loss was do a simple failure to address Swift’s defenses at the district court, and again on appeal. Thus ended Graham’s fourth lawsuit against Swift since 2015, and Graham’s claim for $42 million is gone, gone, gone, gone, gone.

Wait . . . Ignorance of the Law is an Excuse?

In Unicolors, Inc. v. H&M Hennes & Mauritz, L.P., 595 U.S. — (2022), the Supreme Court held that under 17 USC 411(b)(1)(A) a certificate of registration is valid even though it contains inaccurate information, as long as the copyright holder lacked “knowledge that is was inaccurate.” 17 USC 411(b)(1)(A).

Unicolors owned copyrights in various fabric designs, and sued H&M for copyright. The jury found in Unicolors’ favor, and the district court denied H&M’s motion for JMOL because the certificate of registration contained inaccurate information. However, the 9th Circuit reversed, finding that Unicolors failed to satisfy the “single unit of publication” requirement, because it offered some of the 31 designs covered by the registration to certain customers. The 9th Circuit took the view that the statute excused only good faith mistakes of fact. Unicolors sought certiorari to review the Ninth Circuit’s interpretation of 17 USC 411(b)(1)(A).

The Supreme Court reversed the 9th Circuit, reasoning first that Section 411(b)(1)(A) says that Unicolors registration is valid “regardless of whether the certificate contains any inaccurate information unless . . . the inaccurate information was included on the application for copyright registration with knowledge that it was inaccurate. Unicolors argued that, when it submitted its registration application, it was not aware (as the Ninth Circuit would later hold) that the 31 designs it was registering together did not satisfy the “single unit of publication” requirement. The Supreme Court said that if Unicolors was not aware of the legal requirement that rendered the information in its application inaccurate, it did not include that information in its application “with knowledge that it was inaccurate.” §411(b)(1)(A) (emphasis added). The Court said that nothing in the statutory language suggests that this straightforward conclusion should be any different simply because there was a mistake of law as opposed to a mistake of fact. In fact, Supreme Court observed, “[i]naccurate information in a registration is therefore equally (or more) likely to arise from a mistake of law as a mistake of fact. That is especially true because applicants include novelists, poets, painters, designers, and others without legal training. Nothing in the statutory language suggests that Congress wanted to forgive those applicants’ factual but not their (often esoteric) legal mistakes.”

The Supreme Court looked to other provisions of the Copyright Statute to confirm that in
this context, the word “knowledge” means actual, subjective awareness of both the facts and the law. The Supreme Court also noted that cases decided before Congress enacted
§411(b) overwhelmingly held that inadvertent mistakes on registration certificates did not invalidate a copyright and thus did not bar infringement actions, and that there is no indication that Congress intended to alter this well-established rule when it enacted §411(b).

The Supreme Court also looked to the legislative history, noting that it indicates that Congress enacted §411(b) to make it easier, not more difficult, for nonlawyers to obtain valid copyright registrations. Given this history, it made no sense to the Supreme Court if §411(b)
left copyright registrations exposed to invalidation based on applicants’ good-faith misunderstandings of the details of copyright law.

H&M argued that such an interpretation of the statute would make it too easy for copyright holders, by claiming lack of knowledge, to avoid the consequences of an inaccurate application. But, the Supreme Court noted, the courts need not automatically accept a copyright holder’s claim that it was unaware of the relevant legal requirements of copyright law. We have recognized in civil cases that willful blindness may support a finding of
actual knowledge.

H&M also argued that “ignorance of the law is no excuse.” The Supreme Court said that this maxim “normally applies where a defendant has the requisite mental state in respect to the elements of a crime but claims to be unaware of the existence of a statute proscribing his conduct.” The Supreme Court said that it does not apply in this civil case concerning the scope of a safe harbor that arises from ignorance of collateral legal requirements.

Copying for Compatability, Rather than Creativity, is Fair

The Supreme Court finally resolved the dispute between Google and Oracle over Google’s copying of 11,500 lines of declaring code from nearly 3 million lines of code from Sun Java API was copyright infringement. Dodging the question of whether such code is even copyrightable, the Supreme Court fount that the copying of the code, for the purpose of making Android programming similar to other Java programming was a fair use.

The Supreme Court found that the Federal Circuit correctly identified Fair Use as a mixed question of law and fact, but ultimately held that the Federal Circuit was wrong as a matter of law when it reversed the jury’s determination of fair use. The Court thoroughly analyzed the four factors identified in 17 USC 107 before concluding that on balance, accounting for the functional nature of computer software, Google’s use was a non-infringing fair use.

The Nature of the Copyrighted Work

The Supreme Court said that the technology at issue had three essential parts: First, the API includes “implementing code,” which actually instructs the computer on the steps to follow to carry out each task.  [Google wrote its own implementing code].  Second, the Sun Java API associates a particular com­mand, called a “method call,” with the calling up of each task. [Oracle did not argue that the use of these commands by programmers itself violates its copyrights.]  Third, the Sun Java API contains computer code that will associate the writing of a method call with particular “places” in the computer that contain the needed imple­menting code. This is the declaring code that Google copied.

The declaring code is inextricably boundup with the use of specific commands known to program­mers as “method calls” that Oracle did not con­test, and it is also boundup with the implementing code, which Google did not copy.  The Court noted that the declaring code (inseparable from the programmer’s method calls) embodies a different kind of creativity. Sun Java’s creators tried to find declaring code names that would prove intuitively easy to remember to attract programmers who would learn the system, help to develop it further, and prove re­luctant to use another.  The declaring code was designed and organized in a way that is intuitive and understandable to developers so that they can invoke it.

These considerations meant that, as part of a user interface, the declaring code differs from the mine run of computer programs. Like other computer programs, it is functional in nature. But unlike many other programs, its use is inherently bound together with uncopyrightable ideas (general task division and organization) and new cre­ative expression (Android’s implementing code). Unlike many other programs, its value in significant part derives from the value that those who do not hold copyrights, namely, computer programmers, invest of their own time and effort to learn the API’s system. And unlike many other programs, its value lies in its efforts to encourage program­mers to learn and to use that system so that they will use(and continue to use) Sun-related implementing programs that Google did not copy.  The Court concluded that in its view the declaring code is, if copyrightable at all, further than are most computer pro­grams (such as the implementing code) from the core of cop­yright.

The Purpose and Character of the Use

In the context of fair use, the Court noted that it has considered whether the copier’s use adds something new, with a further purpose or different character, altering the copyrighted work with new expression, meaning or message, i.e. whether it is transformative. In determining whether a use is transformative, the court said that one we must go further and examine the copying’s more specif­ically described purposes and character.

The Court said that Google’s new product offers pro­grammers a highly creative and innovative tool for a smartphone environment. To the extent that Google used parts of the Sun Java API to create a new platform that could be readily used by programmers, its use was con­sistent with that creative progress that is the basic Con­stitutional objective of copyright itself.  The Court found that Google copied the API (which Sun created for use in desktop and laptop computers) only insofar as needed to in­clude tasks that would be useful in smartphone programs, and it did so only insofar as needed to allow programmers to call upon those tasks without discarding a portion of a familiar programming language and learning a new one.  These and related facts convinced the Court that the “purpose and character” of Google’s copying was transformative—to the point where this factor also weighed in favor of a finding of fair use.

Even though Google’s use was a commercial endeavor — this was not disposi­tive, particularly in light of the inherently transformative role that the reimplementation played in the new Android system. The Court also questioned whether bad faith has any role in a fair use analysis, but in the end simply concluded that it was not determinative in the present case.

The Amount and Substantiality of the Portion Used

While when considered in isolation, the quan­titative amount of what Google copied was large — totaling approximately 11,500 lines of code, considering the entire set of software material in the Sun Java API, the quantitative amount copied was small. The total set of Sun Java API computer code, includ­ing implementing code, amounted to 2.86 million lines, of which the copied 11,500 lines were only 0.4 percent.  While even a small amount of copying may fall outside of the scope of fair use where the excerpt copied consists of the “heart” of the original work’s creative expression, copying a larger amount of material can fall within the scope of fair use where the material copied captures little of the material’s creative expression or is central to the copier’s valid purpose.

The Court said that a bet­ter way to look at the numbers was to take into account the several million lines that Google did not copy. The Sun Java API is inseparably bound to those task-implementing lines — its purpose is to call them up. The code Google copied was “not because of their crea­tivity, their beauty, or even (in a sense) because of their purpose.” Google copied them because programmers had already learned to work with the Sun Java API’s system, and it would have been difficult, perhaps prohibitively so, to at­tract programmers to build its Android smartphone system without them. Further, Google’s basic purpose was to cre­ate a different task-related system for a different computing environment (smartphones vs. desktop and laptop computers) and to create a platform—theAndroid platform—that would help achieve and popularize that objective. The Court concluded that the “substantiality” factor will generally weigh in favor of fair use where, as here, the amount of cop­ying was tethered to a valid, and transformative, purpose.

Market Effects

The Court acknowledged that consideration of market effects where computer programs are at issue can be complex. Potential loss of revenue is one consideration, but not the whole story. The courts must also take into account the public benefits the copying will likely produce.  The Court noted that the jury could have found that Android did not harm the actual or potential markets for Java SE.  The jury was repeatedly told that devices using Google’s Android platform were different in kind from those that licensed Sun’s technology.  The Court found that taken together, the evidence showed that Sun’s mobile phone business was declining, while the market increasingly demanded a new form of smartphone technology that Sun was never able to offer.

The Court said that a substantial part of the value may come from the fact that users, including program­mers, are simply used to it, and there was no indication that the Copyright Act sought to protect third parties’ investment in learn­ing how to operate a created work.  The Court said that allowing protection of Sun Java API’s declaring code was a lock limiting the future creativity of new programs, and that this lock would interfere with, not further, cop­yright’s basic creativity objectives.

Conclusion

The Court held that where Google reimplemented a user interface, taking only what was needed to allow users to put their accrued talents to work in a new and transformative program, Google’s copying of the Sun Java API was a fair use of that material as a matter of law.


Employee Agreement Review

A good way to test the adequacy of your current employee agreement is to consider what help it provides with common problems.

What happens if your employee assigns an invention to someone else? An employee agreement that includes both an agreement to assign future inventions, as well as a present assignment of future inventions. That way the employee has nothing left to assign to someone else.

What happens if your employee is unable to (or refuses to) execute an assignment in the future? Often times, you can use the employee agreement, but it would be handy if the employee gave someone at the company a power of attorney to execute documents on behalf of the employee.

What happens if your employee is unable to (or refuses to) execute an patent declaration in the future? U.S. Patent laws now address for this contingency, allowing a co-inventor of the company to sign for the inventor, but it would be nice to have the inventor affirmation that the company may do so.

What happens if your employee leaves to compete with you, and attacks the validity of the patent he or she assigned to you? At least for now, the Doctrine of Assignor Estoppel prevents someone who assigns a patent from later challenging that patent, but Assignor Estoppel does not apply to validity challenges in the U.S. Patent and Trademark Office (e.g., ex parte reexamination, post grant reviews, and inter parte reviews.) An employee can agree to never challenge patents on the invention he or she assigns to the company.

What happens if your employee leaves with your confidential information (or that of your customers or suppliers)? Your employee agreement should require employees to maintain the confidentiality of your information, as well as that of your customers and suppliers. It should also give you the right to obtain an injunction to prevent disclosure and use of your information. Finally to make sure that you have full access to all of the available statutory protections, your agreement should have a whistle blower exception so that you can take advantage of the Defend Trade Secrets Act.

What happens if your employee misuses your computer systems? There are federal statutes (the Computer Fraud and Abuse Act) and state statutes that protect computer systems from improper access and use. The problem is that employees are generally deemed to have authorization to access their employer’s computer system. An employee agreement can define an employee’s authorization to access the employer’s computer system, potentially facilitating action for misuse.

Reducing Costs: Patent Maintenance Fees

Most patent-issuing authorities charge maintenance fees or annuities to maintain a patent after it issues. In the U.S. these fees are due 3 1/2, 7 1/2, and 11 1/2 years after issuance, and are $1600, $3600, and $7400. In most other countries these fees are charged annually, typically starting low and quickly escalating to a thousand dollars or more per year.

Early on the fees are low and the technology is new, and paying the fees seems a no-brainer. But after several years, if the technology hasn’t proven itself, and as the maintenance fees begin to claim, the decision is not so clear cut. A business can realize substantial savings by dropping patents on technologies that are not adding value to the business. However, there is significant resistance to do so, because after all so much as been already spent, what’s another thousand dollars? And, no one wants to be responsible for dropping that one patent that — against all odds — suddenly becomes valuable in its twilight years.

However a smart business will periodically review its patent portfolios, and drop the patents that are not likely to contribute value. These resources are better directed toward the protection of new, promising technologies. It is for this reason that each year between about 15% and 20% of U.S patents due for maintenance fees are abandoned.

As the charge above, illustrates fewer than 20% of Korean and European patents are maintained through their full 20 year terms, fewer than 30% of Japanese patents are maintained for their full 20 year terms, and only about 50% of U.S. patents are maintained for their full 20 year terms. (The higher U.S. Maintenance rates are an artifact of the fact that the last maintenance fee is due 11 1/2 years of issuance, and optimistic patent owners are unwilling to make the difficult decision at that point to allow the patent to lapse. But the maintenance rates of patents in other countries, suggest that they should.

The above chart of cumulative maintenance fee costs shows that maintaining a patent through its entire life dwarfs’ the cost of obtaining the patent, and should be reserved only for those patents that are actively adding value to the business.

19 Things You Can Do During the Lock Down, To Improve Your IP Portfolio

Lock Down fatigue is setting in, and budgets are tightening, but there are plenty of things that you can do at little or no cost while hunkered down at home to improve your Company’s IP Portfolio for when the business resumes.

  1. Establish an Company wide IP Policy. An IP Policy can help cast the company in a more favorable light should a dispute arise, and they can actually drive employee conduct.
  2. Establish a formal trade secret program, including protocols for protecting the Company’s trade secrets and confidential information, and an employee training program to make sure those protocols are followed.
  3. Update the Company’s Employee Agreement. Does your agreement include a present assignment of employee inventions? Does it take into account the Defend Trade Secret Act? Does it take into account state employee inventor statutes. Does it give the Company a power of attorney to act for departed or uncooperative employees?
  4. Update your invention disclosure form. Does it take into account the changes in the AIA? Does it include a assignment of rights?
  5. Establish a virtual IP Committee that can meet using an online documents to evaluate new disclosures and make maintenance decisions.
  6. Cull the IP portfolio to reduce on-going maintenance costs. Look for donation opportunities to off-load unused IP at a tax-advantageous manner. Consider making some IP available for compulsory licensing, which can reduce maintenance costs by as much as 50%,
  7. Look for licensing opportunities, to generate revenue from the portfolio. A good source of licensees are owners of patents and applications cited in your own patents and applications, and the owners of patents and applications which cite to your patents and applications.
  8. Look for enforcement opportunities. A good source are the owners of subsequent patent applications where your patents have been cited.
  9. Finally polish up your Confidential Disclosure Agreements. Do they take into account effects of the AIA?
  10. Establish procedures for handling the receipt of unsolicited ideas form outside the Company. These continue to be a source of risk from unfounded claims.
  11. Audit patent marking, and finally get around to virtual patent marking under 35 USC 287(a).
  12. Audit trademark marking, and particularly where U.S. products with brands marked with an ®, are exported to countries where the mark is not registered.
  13. Create definitive trademark use guidelines,
  14. Revamp the Company’s website’s terms and conditions.
  15. Establish a Company social networking policy and email guidelines
  16. Finally take the time to see how the Madrid Protocol can reduce maintenance costs, and expand the scope of the Company’s trademark portfolio.
  17. Create a permissions for to address requests for permissions to use the Company’s trademarks and copyrighted materials.
  18. Register the copyright to the Company’s product literature, packaging advertising and promotional materials. Registration is a prerequisite to bringing suit, and obtaining the registration before infringement begins gives access to an award of statutory damages and attorneys’ fees.
  19. Create a new employee IP orientation program.

File When Ready!

It may come as a surprise that even patent attorneys don’t believe that every invention should be patented. The time, effort and expense of preparing and filing a patent application should be reserved for those inventions that are likely to provide an advantage. Here is a list of criteria to help judge evaluate whether an invention should patented. These can also help prioritize multiple inventions, and help decide which inventions may be worthy of extra investment.

NATURE OF THE INVENTION
Does the invention relate to a new product or service?
Does the invention relate to an improvement in an existing product or service?
Does the invention relate to an improvement in the manufacturing or distribution of an existing product or service?
TECHNOLOGICAL SIGNIFICANCE
The invention solves a problem only faced by Company’s particular approach.
The invention solves a problem faced by Company’s major competitor(s).
The invention solves a problem faced by the Industry at large.
The invention provides a new capability for Company’s products.
The invention provides a new capability for Company’s and major competitor’s products
The invention provides a new capability for the products of the industry at large.
The invention improves quality.
The invention makes the product easier to use/more reliable.
The invention makes the product safer.
The invention reduces costs.
TIMELINESS
The invention is being implemented.
Implementation of the invention is scheduled.
Implementation of the invention is planned.
No immediate plans to implement the invention.
The invention is presently fully developed.
The invention could be fully developed as a routine matter with minimal resources.
The invention will require significant resources to completely develop.
The invention will require a major project to completely develop.
The invention is currently only theoretically possible.
COMMERCIAL SIGNIFICANCE
The invention relates to a high volume, high profit product.
The invention relates to a medium volume, high profit product.
The invention relates to a high volume, medium profit product.
The invention relates to a low volume, high profit product.
The invention relates to a medium volume, medium profit product.
The invention relates to a high volume, low profit product.
The invention relates to a low volume, medium profit product.
The invention relates to a medium volume, low profit product.
The invention relates to a low volume, low profit product.
COMMERCIAL IMPACT
      DEMAND
The invention creates an entirely new product or service.
The invention involves a feature that makes the Company’s product critical to all or most customers
The invention adds a feature that makes the Company’s product superior to all or most customers.
The invention adds a features that is critical to an important subgroup of customers.
      SALES
The invention will make it more likely most consumers would purchase the Company’s product/service. 
The invention will make it more likely that some customers will purchase the Company’s product/service.
The invention will allow the Company to sell other unrelated products.
      PRICING
The invention will allow the Company to increase prices.
The invention will allow the Company to maintain prices.
The invention will force competitors to reduce prices to compete.
NON-INFRINGING ALTERNATIVES
The anticipated claim scope cannot be designed around.
The anticipated claim scope cannot be designed around without considerable time or expense.
The anticipated claim scope cannot be designed around without competitively significant delay or expense.
The anticipated claim scope cannot be designed around without inconvenient delay or expense.
The non-infringing alternatives are equivalent.
The non-infringing alternatives are acceptable.
The non-infringing alternatives would be regarded as unsatisfactory to most customers.
The non-infringing alternatives would be regarded as unsatisfactory to a significant subset of customers.
SCOPE OF PROTECTION
The invention relates to entirely new technology with great prospects of patentability.
The invention relates to a new application of technology with good prospects of patentability.
The invention is a minor advance with surprising result and fair prospects of patentability.
The invention is a minor improvement with a chance of patentability
The patent would be infringed by a single entity (vs. multiple entities acting together).
The patent would be infringed in a single country.
Infringements of the patent could be easily detected.
The Company is likely to enforce the patent against anticipated infringers.
The Company might enforce the patent against anticipated infringers.
The Company probably would not enforce the patent against anticipated infringers.
ALTERNATIVE PROTECTION
The invention can be protected in whole or in part as a trade secret.
The invention can be protected in whole or in part with copyright.
The invention can be protected in whole or in part with trademark or trade dress.
The invention can be protected in whole or in part with a design patent. 
OTHER CONSIDERATIONS
Patenting the invention is important to building/maintaining a portfolio.
Patenting the invention is important to the marketing department.
Patenting the invention is important to an important customer.
Patenting the invention is important to a strategic partner.
Patenting the invention is politically expedient (important to management).
Patenting the invention is required by contractual obligation.
Patenting the invention is useful as a defensive position.
Patenting the invention could be useful in future licensing or cross-licensing.

Design Patent Infringement is a Matter of Appearance and Appearances

Nike recently sued Skechers for infringement of twelve of Nike’s design patents. The Complaint convincingly establishes the similarity of the appearance of the shoes:

In addition to appearance, the Complaint also develops a convincing case on appearances, detailing Sketchers strategy of copying:

Nike explains Skecher’s practice of Skecherizing competitor’s designs:

Nike’s Complaint recognizes that while competition is legitimate, people inately believe that copying is wrong. While Skechers appears to embrace its conduct, most business work to preserve its image as a legitimate competitor, and not merely a copier. To this end, a business should pay attention to how it characterizes its own conduct. Internal project names that make the business look like a pirate, or internal communications that talk about “ripping off, “knocking off,” or even “copying,” can cast the company in a bad light to a judge or jury. If what the business is doing is legimate, there is no need to characterize the conduct as improper or inappropriate — when the issue is design patent infringement, appearances can matter just as much as appearance.

A Lesson in History, and in Particular Who Owns it

Last month, General Chuck Yeager sued Airbus for violation of right of publicity, false endorsement, and trademark infringement. The basis of his complaint? In introducing its new Racer high-speed, cost effective helicopter, Air Bus referenced General Yeager’s breaking of the sound barrier at a press conference, and then repeating the reference on line and in print. Specifically, Air Bus said:

Exhibit A to General Yeager’s Complaint

This seems little more than an innocuous reference to a historical fact. It adds some information and interest to an otherwise bland commercial statement, but it seems highly unlikely to cause anyone to believe that General Yeager is in any way connected with the Racer helicopter, let alone endorses it. Shouldn’t anyone, including a commerical entity, have the right to reference a historical event to make a point — at least if they do so in a way that doesn’t make it seem that they have the approval or endorsement of those involved in the event?

Unfortunately, the right of commercial speakers to reference historical events is not so clear. Had Air Bus been a slightly better student of history, it might of known that this is a lesson that General Yeager taught AT&T nearly a decade earlier. AT&T Mobility — then called Cingular — referenced General Yeager in an eerily similar press release:

To paraphrase George Santayana, those who don’t study history are doomed to repeat it. One might add that if you are commercial entity, even if you study history, you best not talk about it!