Category Archives: Uncategorized

Kanye Wins Kanye v. Coinye Cryptocurrency Case, Largely by Default  

No surprise that Kanye has won the Kanye v. Coinye cryptocurrency case. While the names are similar and there is no doubt that Kanye would be expected to go after something so close and associative, contrary to media spin this is not a case of a big media star going after the little guy who just happens to be too close for comfort. In this case it appears that from day one all efforts by the defendants were to create a Kanye West associated digital currency and trade on his name and likeness, including putting his image on the representations of the coins.

From the Compliant:

Defendants have willfully and admittedly traded upon the goodwill and notoriety of Kanye West, one of the most famous entertainers and brand names in the world.

 …

Defendants have publicly stated that: (i) they “chose to represent Kanye because he is and always has been a trendsetter, and he’s always keeping things unique;” and (ii) they were “really not sure how Kanye [was] gonna react.” Moreover, Defendants cowardly remained anonymous because “[Kanye West] really isn’t someone we want to piss off’ and that they would “love if Kanye named dropped `Coinye’ . . . We don’t want to pay him off to name check us, but it’d be sick if he does so.” Defendants also boldly asserted that “Anarcho-capitalism is coming, it can’t be stopped. Whether it has a symbol that looks like a dollar, a dog, or a cartoon picture of a rapper, it’s all the same thing.”

 Of course the biggest insult might be equating Kanye West to a dog or a cartoon, but legally that was a secondary issue at best.

Initially the case had some extra buzz by naming Amazon.com as a defendant, but they were quickly dropped. The complaint is worth reading, linked below. A few of the defendants entered into consent judgments, but the majority were defaulted as per the order.

Move along now.  Nothing more to see here.

 

Complaint: Kanye West v. McEnery, et al (Coinye) S.D. NY :14-cv-00250

Consent Judgment: Kanye West v. McEnery, et al (Coinye) S.D. NY :14-cv-00250

Default Judgment : Kanye West v. McEnery, et al (Coinye) S.D. NY :14-cv-00250

 

Overzealous Defendants Ordered to Pay

The recent Octane Fitness, LLC v. ICON Health & Fitness, Inc., 134 S. Ct. 1749 (2014) case is often held out to be a victory in the fight against patent trolls or people being sued for patent infringement.  But patent trolling is turning out to be one of those things like voter fraud.  Yes it happens, but it seems that for all the hype the actual problem is nominal compared to the attention it gets.

In an interesting turn of events, in the recent case of Romag Fasteners, Inc. v. Fossil, Inc., et al., the Octane Fitness decision ended up helping a patent rights holder filing suit against an infringer.

Romag Fasteners makes magnetic snaps and fasteners which were used by Fossil to manufacture handbags.   Romag owned a relevant patent and trademark.  Fossil was caught using counterfeit fasteners, some of which even carried the trademark and the patent number, and a suit followed. However, Fossil did not wish to admit to liability and put on a vigorous defense throwing everything it could at Romag.  Despite a notable fight, the simple facts were Fossil was caught “red-handed” and at the end of the case, “the Court concludes that Defendants’ pursuit of its indefiniteness invalidity defense, and its failure to formally withdraw its remaining invalidity defenses until after the close of evidence weigh in favor of an award of fees in this case.”

In other words, trying to enforce a bogus patent will result in an award of costs and fees for a defendant, and so too will raising pointless defenses that merely burden the parties and case.

Full text of opinion: Romag Fasteners, Inc. v. Fossil, inc. et al D. Con. 3:10cv1827, August 14, 2014

And Some People Complain About Suits for Money…

 

The Cable, a national news outlet for Nigeria, is reporting Nigerian singer Stella Monye advocates music pirates should be punished by amputation.   She is quoted as saying:  “Cutting their fingers off will stop them, by the time you cut off two people’s fingers others will stop.”

Maybe she was speaking in jest, but in parts of Nigeria interfering with the oil industry, homosexuality and adultery are punishable by death sentences.  So who knows if downloading a song in Nigeria might soon cost you a finger.

Original story at: http://www.thecable.ng/amputate-pirates-stella-monye-proposes | TheCable

 

And for a song by Ms. Monye – http://youtu.be/lLdC_ONUObk

Lying Is Still Bad – Apotex v. UCB

 

In Apotex v. UCB, inventor Sherman, failed to be honest and fair with the Patent and Trademark Office (PTO).   The patent was lost, and it will be difficult for Apotex or Sherman to ever enforce another patent. The simple lesson is that if you lie about what you have and how you got it, then odds are you do not have anything. While this case was about patents, similar rules apply to copyrights and trademarks.

“A patent by its very nature is affected with a public interest. The public interest is best served, and the most effective patent examination occurs when, at the time an application is being examined, the Office is aware of and evaluates the teachings of all information material to patentability. Each individual associated with the filing and prosecution of a patent application has a duty of candor and good faith in dealing with the Office, which includes a duty to disclose to the Office all information known to that individual to be material to patentability…” 37 C.F.R. 1.56(a) / MPEP 2001.

From the opinion:

The district court also found that Dr. Sherman made several misrepresentations to the PTO regarding the prior art.

The district court also found that Dr. Sherman, in the specification and through Dr. Lipp’s declaration, mischaracterized the Gu article by asserting that only a minor portion of the drug, if any, is converted to moexipril magnesium. Lastly, the district court found that Dr. Sherman lied in the ’556 patent application by including certain examples of experiments that were never conducted. The court noted that each example is written in the past tense as if it had occurred, but Dr. Sherman admitted at trial that the experiments were made up in his head.

In addition to the misrepresentations, the district court found that Dr. Sherman withheld relevant prior art from the PTO.

To be clear, we agree with Apotex that Dr. Sherman had no duty to disclose his own suspicions or beliefs regarding the prior art. There is nothing wrong with advocating, in good faith, a reasonable interpretation of the teachings of the prior art. The misconduct at issue, however, goes beyond failing to disclose a personal belief or alternative interpretations of the prior art; here, Dr. Sherman affirmatively and knowingly misrepresented material facts regarding the prior art.

In the law, as with most things, lying, cheating and stealing are (still) bad.

 

Full text of opinion:Apotex, Inc. v. UCB, Inc. (2013-1674, Fed. Cir. Aug. 15, 2014)

The patent is (or was) U.S. Patent No. 6,767,556

A Clean Slate – Fortres Grand v. Batman (Warner Bros.)

On August 14 the 7th Circuit issued its Fortres Grand v. Warner Brothers opinion (No. 13-2337) clarifying that the gist of any trademark infringement claim is consumer confusion.

As per the opinion, this case is all about:

Fortres Grand Corporation develops and sells a desktop management program called “Clean Slate.” When Warner Bros. Entertainment used the words “the clean slate” to describe a hacking program in the movie, The Dark Knight Rises, Fortres Grand noticed a precipitous drop in sales of its software. Believing Warner Bros.’ use of the words “clean slate” infringed its trademark and caused the decrease in sales, Fortres Grand brought this suit. Fortres Grand alleged that Warner Bros.’ use of the words “clean slate” could cause consumers to be confused about the source of Warner Bros.’ movie (“traditional confusion”) and to be confused about the source of Fortres Grand’s software (“reverse confusion”).

 The 7th Circuit clarified that injury related to trademark rights is based on “confusion about ‘origin, sponsorship, or approval of … goods’” and not “general confusion ‘in the air’.” And goods subject to a trademark claim must be “real goods in commerce.”

After reviewing the several (there are 7) factors to be considered the 7th Circuit held, “Fortres Grand has not and could not plausibly allege that consumers are confused into thinking Fortres Grand is selling [software] licensed by Warner Bros. Fortres Grand’s real complaint is that Warner Bros.’ use of the words “clean slate” has tarnished Fortres Grand’s “clean slate” mark by associating it with illicit software. But this type of harm may only be remedied with a dilution claim.”

While this might be promoted as a “movies can’t infringe trademarks” opinion, that is not what this case is about. As the court makes clear, the facts implicate a dilution claim not a confusion claim. Fortres Grand alleged consumers were confused and the court simply stated that since Warner Bros. had no real “clean slate” product, then no reasonable consumer could be confused.  Had Warner Bros. sold or given away a software add-on named “Clean Slate” to promote the movie as a marketing tool, then Fortres Grand would certainly have had a claim for the software marketing component.

While sensational in its parties, there is no new law in this case.

Move along now.

(Full 7th Cir. Opinion: Fortres Grand Corp. v. Warner Bros. Entertainment Inc., 13-2337, Aug. 14, 2014)

Who’s Trolling Who?

In the world of online media rights, few issues are met with more religious zeal than the issue of the copyright troll.   On the one side there are the parties labeled as trolls who sue people who download movies. And on the other are those who claim to be innocent, or as is more often the case, claim they only downloaded a crappy movie that was not even worth the price of a theatre ticket and the attorneys that defend the “free internet.” But it occurs to me, the troll in this paradigm may be mislabeled.

With growing online rights enforcement by parties such as X-Art, filing thousands of Malibu Media v. Doe cases nationwide, and other parties such as Voltage Pictures (The Company You Keep, Dallas Buyers Club, Killer Joe, etc) there are also a growing number of attorneys that claim to be defenders of those that get caught up in cases like this with their marketing promise to defend and save the free internet from the trolls.

But what is really going on? First look at the name, copyright troll or just troll. Slurs and broad derogatory titles are at their base discriminatory and dehumanize their targets. More commonly found in the context of racial or ethnic slurs, they permit the user to maintain a perceived position of superiority in their beliefs regardless of facts and law to the contrary. After all, how could anyone be wrong when the other side is a troll?

So what is a troll, and in particular, what is a copyright troll? While a copyright troll has no formal definition, the related term patent troll has been defined in a number of states, starting with Vermont and at least 9 other states thought their anti-troll laws. In these laws, all basically based on the Vermont model, there is a general acknowledgement

“The protections afforded by the federal patent system create an incentive to invest in research and innovation, which spurs economic growth. Patent holders have every right to enforce their patents when they are infringed, and patent enforcement litigation is necessary to protect intellectual property.”

So as a baseline, everyone agrees rights are good and should be protected. And the law goes on to discuss that while patents are good, bad faith attempts to enforce patents, a/k/a “trolling” is bad and lists the factors to evaluate what should be considered trolling. And they are:

(1) The demand letter does not contain the following information:

(A) the patent number;

(B) the name and address of the patent owner or owners and assignee or assignees, if any; and

(C) factual allegations concerning the specific areas in which the target’s products, services, and technology infringe the patent or are covered by the claims in the patent.

(2) Prior to sending the demand letter, the person fails to conduct an analysis comparing the claims in the patent to the target’s products, services, and technology, or such an analysis was done but does not identify specific areas in which the products, services, and technology are covered by the claims in the patent.

(3) The demand letter lacks the information described in subdivision (1) of this subsection, the target requests the information, and the person fails to provide the information within a reasonable period of time.

(4) The demand letter demands payment of a license fee or response within an unreasonably short period of time.

(5) The person offers to license the patent for an amount that is not based on a reasonable estimate of the value of the license.

(6) The claim or assertion of patent infringement is meritless, and the person knew, or should have known, that the claim or assertion is meritless.

(7) The claim or assertion of patent infringement is deceptive.

(8) The person or its subsidiaries or affiliates have previously filed or threatened to file one or more lawsuits based on the same or similar claim of patent infringement and:

(A) those threats or lawsuits lacked the information described in subdivision (1) of this subsection; or

(B) the person attempted to enforce the claim of patent infringement in litigation and a court found the claim to be meritless.

(9) Any other factor the court finds relevant.

While it is easy to have a knee-jerk reaction and claim anyone and everyone that sues for copyright enforcement is a troll, (just as it is easy to claim everyone who is sued is a lying pirate and thief) the rules are more complex.  Trolling is a specific type of activity.

Similarly, the law outlines factors that weight against being considered a troll, those being:

(1) The demand letter contains the information described in subdivision (b)(1) of this section.

(2) Where the demand letter lacks the information described in subdivision (b)(1) of this section and the target requests the information, the person provides the information within a reasonable period of time.

(3) The person engages in a good faith effort to establish that the target has infringed the patent and to negotiate an appropriate remedy.

(4) The person makes a substantial investment in the use of the patent or in the production or sale of a product or item covered by the patent.

(5) The person is:

(A) the inventor or joint inventor of the patent or, in the case of a patent filed by and awarded to an assignee of the original inventor or joint inventor, is the original assignee; or

(B) an institution of higher education or a technology transfer organization owned or affiliated with an institution of higher education.

(6) The person has:

(A) demonstrated good faith business practices in previous efforts to enforce the patent, or a substantially similar patent; or

(B) successfully enforced the patent, or a substantially similar patent, through litigation.

(7) Any other factor the court finds relevant.

Key in this is that anyone that is an inventor or creator, or has a business related to the rights outside of litigation, or anyone that invested in the original rights being enforced is not a troll under the law.   Many of those that are labeled as trolls, Malibu Media, Voltage, etc. are by definition not trolls. These are companies that invest in films, make films and sell films. Under the law, the vast majority of rights enforcement actions are not troll actions and anyone that claims they will help you “fight a troll” falsely uses that term to support a claimed position of superiority in their beliefs regardless of the facts and law to the contrary.

When I see all the attorneys lining up offering to defend against the actions of copyright trolls, usually for what they claim to be a reasonable fee of a few thousand dollars, I wonder why they need to rely on the derogatory and legally false term of “troll” to solicit business. And while much can be said about lawsuits filed for thousands of dollars against thousands of infringers, I wonder how much money is taken in by those that claim they are defending the free Internet and claiming the mantle of moral superiority.

It occurs to me that there may be more money being paid to those that defend these cases than is paid by those that are filing them.

Who’s trolling who?

Big Data and the Myth of Online Anonymity

Most people assume that because the door to their room is closed there is some degree of privacy.  But we are learning that is not the case, especially when you reach out through the internet and do things.

Making this shockingly clear is a recent publication by Movoto analyzing public BitTorrent records and indexing them to geolocated IP addresses and other public data.  The result is an interesting index that shows what people are doing on a state by state level.   While the data shown is more about novelty than utility, it does give some insight into what is out there.  BitTorrent theft is prolific and there is hard evidence to back up the conduct.  Expect analytics like this to show up in congressional hearings soon as Congress is lobbied to take further action.

Click the image from the site to view the page and peruse some of what is publicly known about BitTorrent activity.

torrent-downloads-per10k

 

 

Promoting a New Model For Music ?

Ted Gioia, who often writes of technology and arts, recently published and article in The Daily Beast advocating lessons the music industry can take from television. His key steps are: 1. Target adults, not kids; 2. Embrace complexity; 3. Improve the technology;  4. Resist tired formulas; and 5. Invest in talent and quality.  However, they key element advocated is the notion that the music industry needs to step back from free distribution and go to a subscription model, such as used by HBO or Netflix.    The article is worth reading: Five Lessons the Faltering Music Industry Could Learn From TV

While it may be an excellent thing to essentially say, “problems with the music industry can be solved if they make better music and sell it,” I think this misses a few elements of the big picture.  One:  Music has traditionally been “subscription.”  One hundred years ago music was sold as live entertainment, where people paid to see an opera or concert.  Then with the development of recorded medium it became subscribed to through the purchase of phonographs, then cassettes, and then CDs.  Broadcast mediums, such as radio have always been secondary in music and with some odd laws, the actual performers are often not paid royalties for FM broadcast. (This is somewhat tied to the reason Radio stations cannot post a schedule for songs to be played in advance.  Believe me, many radio stations know what songs will be played hours in advance, but they are limited to statements such as, “coming up in the next hour we will have…”) Radio was a free/advertising supported medium which promoted sales of product, such as CDs and was always a secondary source of music revenue.   Contrast television which was originally a free broadcast medium and the singular source for content for a long time was a free/advertising supported network broadcasts. Subscription television content and wide spread direct to consumer sales of video is relatively recent.

While it might be said that music should learn from television, what has happened is television has learned from music.   So where did music go wrong?  Simple:  Technology- namely bandwidth and file size.  A few years ago technology did not readily allow end users to freely copy video, while music could easily be compressed down with MP3 compression and an entire 50 minute album could be converted to a digital file that was compact and easy to transmit.   Where a 30 minute video was still too large to manage for many systems, recorded sound was easy.  However that has now changed as the average North American household now was the bandwidth for bi-lateral live streaming of video and computers can readily manage video compression.  As a result we are now seeing instances where programs such as Game of Thrones are being watched by more people who download it for free through BitTorrent than subscribe to the content provider.

Music might need to learn something from television, but television needs to pay attention to what happened to the music industry. How we monetize content, wether video or audio is changing.

Danzig / The Misfits – Claims dismissed

On August 6, Judge Klausner dismissed Glenn Danzig, The Misfits former front man’s claims against his former bandmate Caiafa (Jerry Only) regarding licensing and sales of band related merchandise.

This was not the first suit between the parties. A 1992 suit was settled in 1994. “The 1994 Agreement contained a paragraph entitled “Merchandising” that provided that Plaintiff and Caiafa would share ownership of The Misfits’ name, trademarks, logos, and artwork that existed during the Classic Misfits Era.”

Subsequent to the settlement Caiafa, as a joint owner of the name and logos, then filed a number of trademarks related to The Misfits name and graphics, and then went on to license merchandise to retailer Hot Topic.

Danzig brought a number of claims, including Lanham Act (Trademark), breach of contract, and interference with business advantage. The court found as customer Hot Topic clearly knew Danzig was not involved in their licensing, there could be no Lanham Act / misrepresentation claim.

Danzig’s claims are dismissed, but there is leave to amend as to the claims for breach of contract and interference with business advantage.  Still pending are Danzig’s separate cancelation proceedings before the USPTO.

An amended complaint, if filed, is due by August 15.

 

A copy of the order:  Danzig_031119462929

Rational Rights