Wednesday, November 9, 2011

Geography & Trademark Law

Some trademark owners who wish to use geographical terms in their marks may meet some registration hurdles, as well as resistance from other trademark holders with the same idea. Using geographical terms is tightly regulated by the U.S. Patent & Trademark Office, and can only be done in certain circumstances.

You are most likely to be able to use a geographical term in a trademark if it is considered a geographical indicator. This term is used to designate products that have special characteristics due to the place they are from. Fine food enthusiasts refer to these location-specific characteristics as terroir. Producers of such products as Champagne from the Champagne region of France, oranges from Florida, apples from Washington state, and blue cheese from Roquefort, France, want you to believe that their products are special because of the special conditions where they are produced. Despite whether or not you believe this to be true, there does exist protection for these geographical indicators. France’s AOC (Appellation d’Origine Contrôlée) system is one of the most familiar. Producers in geographical areas who wish to obtain AOC-eligible products must meet rigorous production standards. The French model has led to the creation of similar systems in other countries such as Spain (Demonación de Origen), the United States (American Viticultural Areas), and, on a broader scale, Protected Geographical Status in the European Union.

In the United States, Geographical Indicators receive the same amount of protection as trademarks, and are administrated by the U.S. Patent & Trademark Office.

If you are a business owner and you want to use a geographical term such as your city, or even an exotic place you’ve never been to, then be cautious. The U.S. Patent & Trademark Office will refuse a trademark application it finds is geographically descriptive or geographically misdescriptive. Geographically descriptive marks, which merely state the origin of a product without alluding to any link between the quality of the product and the place, are refused to allow other parties to use the same geographical location in their marks. Geographically misdescriptive marks indicate a location other than the origin of the goods. The U.S. Patent & Trademark finds these types of marks could confuse consumers into believing the goods do come from the stated location.

If you have a question related to trademark applications with or without geographic names, then please contact Special Counsel, Veronique Kherian at vkherian@higagipsonllp.com or at (415) 692-6520 Ext. 109.

Thursday, November 3, 2011

Copyright Infringement & The Fair Use Defense

Many of us have heard of the term “fair use” with regard to copyright protections. Take the Obama 2008 presidential campaign. In that case, artist Shepard Fairey created the famous “HOPE” poster, featuring a painted version of an Associated-Press (AP) photograph of Barak Obama. After the AP made requests for compensation based on Fairey’s use of the photograph, Fairey sought a court finding that his work was protected by fair use, which would free him from obligations to the AP. That case was settled out of court. A fair use defense can be raised in a variety of settings, from technology cases, to music, to fine art, to news stories. Fair use is even what may shelter Google from certain copyright infringement claims when it creates thumbnail images of our search results. Perfect 10 v. Google, Inc., 416 F. Supp. 2d 828 (2006).
 
In practice, fair use is a defense that can be raised in the event of alleged copyright infringement. Claiming fair use will not prevent a lawsuit from being filed or from going to court, but it can save a defendant from a finding of infringement. What makes fair use so difficult to define? Each fair use analysis is fact-specific, so guidelines are not universal. When looking at facts, though, courts will look at the following elements, found in Title 17, Section 107 of the Copyright Act:

*The purpose and character of the use, including whether such use is of commercial nature or is for nonprofit educational purposes. A finding that the new work is for commercial use will not necessarily lead to a finding against fair use. Courts will look at all of the circumstances surrounding a dispute to determine if fair use can be a successful defense.

*The amount and substantiality of the portion used in relation to the copyrighted work as a whole. What elements of the original work are being copied? Is the entire work copied? That the entire work is copied may not spell the death of your project, under certain circumstances. For instance, in the famous Betamax case, a device that enabled “time-shifting,” or, copying television programs to watch at home at a later time was considered to constitute fair use. Sony Corp. of America v. Universal City Studios, Inc., 464 US 417 (1984). It is more important to look at the amount of the copyrighted work copied in relation to the totality of the new work.

California courts also look at how much the new work has transformed the original work. Taking from a defamation lawsuit, which incorporates some fair use analysis, a comic book that redrew two live-action musicians into half-human, half-worm villains was found to be transformative and included enough original content to warrant protection. Winter v. DC Comics, 69 P.3d 473 (Cal. 2003).

*The nature of the copyrighted work. Is the copyrighted work the kind of work that copyright law intends to protect? A creative copyrighted work may be considered entitled to more protection than news commentary, for instance.

*The effect of the use upon the potential market for, or value of, the copyrighted work. This doesn’t have to relate to the original work in its original form. This part of the analysis can include a market for derivative works—for instance, mugs and t-shirts featuring a movie still. For instance, would a hip-hop take of the classic Roy Orbison song Pretty Woman endanger any of the original song’s market share? The U.S. Supreme Court found that it would not. Campbell v. Acuff-Rose Music, Inc., 510 US 569 (1994).

In Perfect 10 v. Google, Inc., 416 F.Supp.2d 828 (2006), the court brought in an extra element for consideration—public interest. To determine public interest, the court balances the interests of copyright holders with the interests of the public and the interests of the defendant. However; in the Perfect 10 case, the court instructed the parties to work out such an agreement on their own, and did not provide a framework for deciding the issue.

What does this mean for your particular case? It depends on a number of factors. Fair use has been inconsistently applied in court decisions, and it can be very difficult to assess whether one particular work will be protected by fair use or not. If you do have a question about the fair use defense, then contact Special Counsel Veronique Kherian at (415) 692-6520 ext. 109, or by email at vkherian@higagipsonllp.com.

Tuesday, November 1, 2011

Search Engine Optimization Can Cause Trademark Infringement

Scrutinize Search Engine Optimization Submissions to Avoid Trademark Infringement


A trademark is a word, name, symbol, or device that a business uses to identify its goods or services and to distinguish those goods or services from those offered by others. Accordingly, the owner of a trademark has the exclusive right to use that mark in interstate commerce. Infringement occurs when a party uses a mark identical to or confusingly similar to a trademark owned by another party. The penalties for trademark infringement are not dependent on the intent of the infringer; trademark infringement is categorized as strict liability. In the United States, trademark infringement is pursued under the Lanham Act. Accordingly, a party found liable for trademark infringement may be subject to the following:
• trademark owner’s lost profits;
• costs of court action;
• trademark owner’s attorney’s fees;
• statutory penalties of three times (3X) actual damages; and/or
• infringer’s goods subject to injunction.

Note that Federal law protections apply regardless of whether the owner of the mark registered the mark with the US Patent & Trademark Office.

Armed with this knowledge, most present day business owners refrain from creating marks that are identical to a competitor’s mark or one that is confusingly similar to a competitor’s mark. A problem arises; however, when an examination of a company’s website reveals that the website uses metatags containing trademarks of competitors. Back in 1999, the Ninth Circuit Court of Appeals held that using a competitor’s mark in your company’s metatags may lead to initial interest confusion, which in turn can amount to trademark infringement.

What are metatags? If a consumer searching for a good or service does not know the company’s domain name, then the consumer will use a search engine such as Yahoo® or Internet Explorer® by typing in keywords to look for the target company’s website. When keywords are entered, the search engine processes those words through a self-created index of websites to generate a list of websites relating to the entered keywords. Each search engine uses its own algorithm to arrange indexed materials in sequence, so the list of websites that any particular set of keywords will bring up differs depending on the search engine used. Search engines look for keywords in domain names, actual text on the web page, and in metatags. Metatags are HTML code intended to describe the contents of the web site. Description metatags describe the web site. Keyword metatags contain keywords relating to the contents of the web site.

With this basic understanding of Internet search engines, there exists the possibility for a company to commit trademark infringement in its efforts to drive consumer traffic to its site. With the growth of the Internet, there is an accompanying growth in the number of firms offering Search Engine Optimization services where a company will revamp a company’s website by expanding the keywords used as metatags to boost the company to the top of the search engine’s list when a search is conducted by a consumer. For example, suppose that a company creates a website to market and sell a new soft drink. The website itself and the text on the web pages that make up the website make no reference to its competitors’ mark or products. However, the SEO firm hired by the company to market the new soft drink set up an entire page of metatags designed to hoist the company’s website to the top of searches for soft drinks. On this hypothetical metatags description page, the following terms appear: Pepsi, Coca-Cola, Gatorade, Lipton, and Starbucks among a host of other descriptive terms. The SEO firm inadvertently exposed the soft drink company to at least 4 separate trademark infringement claims. Why? Taking a moment to consider the circumstances reveals the error.

The soft drink company’s competitors have spent a lot of time and money building their respective brands. Yet, by listing the competitors’ trademarks in its metatags, the new soft drink company effectively usurps its competitors’ trademarks as descriptors for its new product. The result will be that a consumer searching for Coca-Cola would be directed to the new soft drink company’s website instead as a result of the search. The new soft drink company is using the fruits of another competitor’s labor and brand building to capture market share. In essence, this redirection of a consumer by using another’s mark amounts to initial interest confusion which could rise to the level of trademark infringement in the wrong circumstances.

The prudent course of action is to closely scrutinize the keywords and descriptors being used to describe your company’s goods or services when the website is initially set up or when a SEO firm is hired to boost traffic to your company’s website. In a trademark infringement action, the owner of the website would be the primary infringer and would be liable for any resulting damages. It is important to note that liability may or may not run to the SEO firm depending on the contractual terms between the parties. In any event, the new soft drink company would be clearly identified as the infringer.

If your company is creating a website or hiring a SEO firm to overhaul your company’s website, then be aware that the use of competitors’ marks in the metatags exposes your company to liability for a trademark infringement claim. The best practice is to eliminate any keywords as metatags that could create initial interest confusion between your products or services and a competitor’s goods or services. For more information on this topic, then contact either Ronnie Gipson at (415) 692-6523, email at gipson@higagipsonllp.com; or Veronique Kherian at (415) 692-6520, email at vkherian@higagipsonllp.com.