Intent to Induce Infringement may be Based on Objectively Noninfringing Conduct in Federal Circuit Ruling

by Chris Kang

On October 23, 2020, the Federal Circuit held that liability for induced infringement may be established through the subjective belief that conduct is infringing where it is objectively reasonable that the conduct is noninfringing.

http://t3.gstatic.com/images?q=tbn:ANd9GcQvPwQiRlAt5y64VWIODeCYaH3SgEontde1bSpnjeg1fwAId5Wi

In 2010, TecSec sued Adobe and several other defendants for direct and induced infringement of its patents.[1] The district court entered a judgment of noninfringement for Adobe because TecSec could not show that Adobe or its users infringed its patents under the adopted claim construction.[2] The Federal Circuit later reversed the district court’s construction and remanded for further proceedings with the new construction.[3] On remand, Adobe filed a motion in limine asking the court to “preclude argument, evidence, or testimony on Adobe’s intent to induce or willfully infringe between March 3, 2011 and October 18, 2013.”[4] The district court granted Adobe’s motion, reasoning that the March 3, 2011 claim construction and noninfringement stipulation made it legally impossible for Adobe to have had the requisite intent to induce third-party infringement and allowing either party to present evidence for the inducement argument would cause the opposing parties undue prejudice while confusing the jury.[5] Subsequently, TecSec appealed the district court’s exclusion of inducement evidence.

The Federal Circuit reversed the district court’s decision, finding that the knowledge requirement of induced infringement can be met through the subjective belief that objectively noninfringing conduct is infringing.[6] The Court rejected the district court’s conclusion that Adobe “lacked the requisite intent to induce infringement,” and determined that an objectively reasonable belief does not answer a contrary subjective belief as a matter of law.[7]

The Federal Circuit found that the limited scope of Adobe’s motion in limine precluded TecSec from presenting all relevant material evidence, and thus prevented the district court from properly resolving the issue as a matter of law.[8] Furthermore, the Federal Circuit determined that the district court failed to explain why admitting the inducement evidence would be too prejudicial against TecSec given that TecSec reiterated its intent to pursue the inducement case regardless if the evidence was admitted.[9]

The Federal Circuit reversed and remanded for further proceedings on TecSec’s post-March 3, 2011 inducement claim.[10]


[1] TecSec, Inc. v. Adobe Inc., 978 F.3d 1278 (Fed. Cir. 2020).

[2] Id.

[3] Id.

[4] Id.

[5] Id.

[6] Id.

[7] Id.

[8] Id.

[9] Id.

[10] Id.

The USPTO Releases New Guidance on Generic.com Terms Following USPTO v. Booking.com

by Chris Kang

The USPTO published new guidelines on October 28, 2020 for analyzing the genericness of “generic.com” terms following the US Supreme Court’s precedential decision in USPTO v. Booking.com B.V.[1]

On June 30, 2020, the Supreme Court ruled that “Booking.com” was not a generic term and was eligible for trademark registration, rejecting the per se rule that a generic term combined with a generic top-level domain, such as “.com” or “.org,” is generic.[2] However, the Supreme Court also declined to “embrace a rule automatically classifying [generic.com terms] as nongeneric.”[3]

Under the new guidance, the USPTO advises examining attorneys to continue addressing generic.com terms under the standard genericness framework, on a case-by-case basis.[4] If the examining attorney presents evidence showing that the relevant consumer would perceive the generic.com term as the name of a class as opposed to a distinguishable member of the class, then the term may be established generic.[5] A few examples that an examining attorney might look to include dictionary usage, industry standards, and the applicant’s own use of the generic.com term.[6]

The refusal process remains the same for a generic.com term, in which the examining attorney must not initially issue a refusal for registration on the Principal Register on a genericness basis, but on a distinctiveness basis along with an advisory on whether the mark may serve as a source indicator.[7] If the examining attorney finds that the term is capable of serving as a source indicator, then he or she may advise that the applicant may amend the application to the Supplemental Register.[8] Otherwise, the examining attorney must include an advisory recommending the applicant against making a claim of acquired distinctiveness or amendment to the Supplemental Register.[9] Contrarily, registration on the Supplemental Register for a generic.com term may be initially refused if the examining attorney finds sufficient evidence that the term is generic.[10] Moreover, a genericness refusal on either register is proper if the applicant has made a claim for acquired distinctiveness and there is strong evidence of genericness.[11]

An applicant seeking registration under a claim of acquired distinctiveness must provide sufficient evidence showing that the generic.com term has obtained secondary meaning in relation to the goods or services.[12] A generic.com term would unlikely be inherently distinctive given that it typically consists of descriptive terms, and thus the applicant must prove that the mark has acquired distinctiveness.[13] Furthermore, neither prior registration nor evidence of an applicant’s five years of exclusive and continuous would likely establish acquired distinctiveness on its own, and thus the applicant must present other evidence to show that the mark may serve as a source indicator.[14] Acceptable evidence for a generic.com term remains consistent with proof of distinctiveness for other trademarks or service marks and may include, inter alia, consumer surveys; consumer declarations; evidence, such as declarations or depositions, showing duration, extent, and nature of the proposed mark’s use in commerce; advertising expenditures; letters or statements from the trade or public.[15] When submitting consumer surveys, the guidance highlights the importance of ensuring that a survey is designed to accurately and reliably represent consumer perception of a proposed mark.[16]

Regarding generic.com terms combined with other matter, generic.com terms that are incapable of serving as a source indicator and can be separated from the other matter must be disclaimed consistent with the current disclaimer policy.[17]

Additionally, the examining attorney may refuse registration where the specimen of use for a generic.com term fails to serve as a source indicator for the named goods or services if the term is solely being used as a website address.[18]

While the Supreme Court has determined that generic.com terms are no longer automatically considered generic, potential marks for generic.com terms “may be subject to a narrower scope of trademark protection” when it consists of generic or descriptive components that may be used in other marks.[19] When examining proposed marks, examining attorneys must determine whether a prior registration for a generic.com term is differentiable from the proposed mark.[20] Each proposed mark must be considered on a case-by-case basis and must nonetheless show that the mark is neither generic nor descriptive pursuant to the Trademark Act.[21]


[1] United States Patent and Trademark Office, Examination Guide 3-20 (2020).

[2] United States Patent & Trademark Office v. Booking.com B. V., 140 S. Ct. 2298 (2020).

[3] Id. at 2307.

[4] United States Patent and Trademark Office, Examination Guide 3-20 (2020).

[5] Id.

[6] Id.

[7] Id.

[8] Id.

[9] Id.

[10] Id.

[11] Id.

[12] Id.

[13] Id.

[14] Id.;37 CFR § 2.41(d).

[15] United States Patent and Trademark Office, Examination Guide 3-20 (2020).

[16] Id

[17] Id.

[18] Id.; TMEP § 1202.19(e).

[19] United States Patent and Trademark Office, Examination Guide 3-20 (2020).

[20] Id.

[21] Id.

Trends in Artificial Intelligence at the USPTO

by Tuong Pham

            The United States Patent and Trademark Office (USPTO) released a benchmark study on October 27, 2020, titled “Inventing AI: Tracing the diffusion of artificial intelligence with U.S. patents.”[1] The report used a machine learning artificial intelligence (AI) algorithm to examine AI technologies in US patents from 1976 to 2018. The specific AI algorithm “flexibly learns from the text of patent documents without being overly constrained by specific classifications and keywords.”[2] After using the AI algorithm, the results were manually reviewed by patent examiners.

            The study examined AI technology diffusion across technologies, inventors, and geography. The USPTO assigns patent applications into specific groupings consisting of more than 600 subclasses based on subject matter. In 1976, AI technologies only appeared in 10% of the subclasses, but by 2018 they appeared in more than 42% of the subclasses. Over time, the percentage of inventors using AI in their granted patents has increased as well from 1% in 1997 to 25% by 2018. IBM currently holds the most AI patents and the top AI patent holders are generally in the information and communication industries.

            In terms of geography, the diffusion of AI patent technologies has increased since 2001. Between 1976-2000, most AI patentees were in large cities such as Silicon Valley, due to the resource advantages for developing technologies held by successful companies and research universities. After 2001, AI patented technologies are diffusing across the US. For example, North Dakota applies AI technologies to agricultural fields. Maine and South Carolina apply AI technologies in data processes for businesses. Oregon has inventors using AI for fitness training and equipment. Montana has inventors for analyzing the chemical and physical properties of materials. The Midwest is slowly adopting more AI patents. Wisconsin has inventors for medical instruments and processes. North Dakota has inventors for AI technologies for agriculture. AI patented technologies are moving away from primarily large cities to across the country.

            The study concludes with the fact that AI is becoming increasingly important for US inventions with the potential to be as revolutionary as electricity. The growth of AI patents is not limited to the United States, but Europe Patent Office has noted that AI was one of the most prevalent fields for patent applications in 2019.[3] As the expansion of AI patented technologies continues to grow, AI has the potential to radically change the world.


[1] United States Patent and Trademark Office: Office of the Chief Economist, Inventing AI: Tracing the Diffusion of Artificial Intelligence with U.S. Patents. IP Data Highlights (October 2020).

[2] Id.

[3] Catherine, Cotter, Digital Technologies Take Top Spot in EU Patent Applications in 2019. https://thelens.slaughterandmay.com/post/102g1n7/digital-technologies-take-top-spot-in-eu-patent-applications-in-2019 (March 2020).

USPTO Raising Trademark Fees for the New Year

by Tuong Pham

            The Final Rule “Trademark Fee Adjustment,” promulgated by the United States Patent and Trademark Office (USPTO), will become effective on January 2, 2021.[1] The Final Rule sets or adjusts 36 trademark fees including increased filing fees and 14 brand-new fees as well. The USPTO published the Federal Register notice in August 2019. The Trademark Public Advisory Committee held a public hearing on September 2019 and provided the written report on October 31, 2019. The USPTO published a Notice of Proposed Rulemaking on June 19, 2020, detailing the new trademark fees.

            The decision was made after considerations of the current U.S economy, operational agency needs, and comments and advice from the public. The USPTO hopes the new fees will provide funds for maintenance and upgrades to its systems and provide an operating reserve in case of financial disruptions.

            All the fee changes may be found in the Final Rule.[2] The table below details some of the major changes.

Fee DescriptionCurrent Fee RateFinal Rule Fee Rate
Filing a TEAS Plus Application through TEAS under §2.22(c) per class$225$250
Filing a TEAS Standard Application through TEAS, per class$275$350
Deleting Goods, Services, and/or Classes After Submission and Prior to Acceptance of an Affidavit under §8 or §71 of the Act on Paper, per class$0$350
Filing a Petition to Cancel through ESTTA, per class$400$600
Filing a Notice of Opposition through ESTTA, per class$400$600
Letter of Protest under §2.149, per Application$0$50
Request for an Oral Hearing, per proceedings$0$500
Ex Parte Appeal to the Trademark Trial and Appeal Board Filed through ESTTA, per class$200$225

Application fees have gone up across the board. TEAS Standard application fees have gone from $275 per class to $350 per class. TEA Plus application fees have gone from $225 per class to $250 per class. Fees have also increased for TTAB cancellations and oppositions, as well as TTAB trial and appeals. The increased fees will better align the fees with the associated cost for the USPTO.

The new fees include a $250 fee per class filed through TEAS for deleting goods, services, and/or classes from a registration after submitting a §8 or §71 declaration, but before the declaration is accepted. The USPTO hopes the deletion fees will encourage registrants to determine and delete goods, services, or classes no longer in use sooner.  

            Additionally, the Final Rule codifies procedures for letters of protest. Requirements include providing an itemized evidence index, submitting no more than 10 items of evidence or 75 total pages, absent special circumstances, and paying a $50 fee per letter of protest. The purpose of these procedures is to encourage the filing of timely, relevant, and well-supported letters of protest.

            Originally, the Final Rule was planned to go into effect in August 2020, but due to the COVID-19 Pandemic, the implementation will be on January 2, 2021. Potential registrants still have time to file to avoid having to pay increased fees.


[1] Federal Register 37 CFR Part 2 and 7 https://www.govinfo.gov/content/pkg/FR-2020-11-17/pdf/2020-25222.pdf

[2] Id.

Political Campaigns and Musicians: 5 Notable Clashes

by Matt Digan

Background

Political campaigns in the United States have had a long and storied history with music. From the inventive and effective “Tippecanoe and Tyler Too” that sang the praises of the Whig Party’s candidates for president and vice president in the 1840 presidential election, to John McCain’s use of Chuck Berry’s “Johnny B. Goode” in his 2008 run for president, music has played an integral role in political campaigns for centuries. Such widespread use of music in political campaigns raises the question of what role the actual artists have in controlling who may use their music and in what context.

The manner in which a campaign uses or intends to use a given song is arguably the most important element in evaluating this question. If a campaign merely intends to use a song to warm up crowds before rallies at various venues around the country, the campaign only needs to obtain a public performance license from a performing rights organization like Broadcast Music, Inc. (BMI) or the American Society of Composers, Authors, and Publishers (ASCAP).[1] Acquiring a license from one of these performing rights organizations does not involve directly contracting with the artists behind the songs and grants a campaign access to millions of songs, though, in the case of ASCAP, members may ask ASCAP to exclude specific songs from a particular political campaign’s license.[2] Campaigns do not usually stir up trouble making use of these types of licenses because they are overwhelming used for activities like playing songs for crowds while they wait for the candidate to come on stage—the uses are not particularly political or potentially controversial.

However, a campaign may seek to go beyond such an apolitical use and instead use a song in a more central role, such as a theme for the candidate and/or campaign message. In these instances, ASCAP recommends that campaigns reach out to the artists for permission because such uses implicate more than just copyright law.[3] An artist’s right of publicity, which provides image protection for famous individuals, and issues of false endorsement, which protects an individual from appearing to support or endorse a product, person, or message, may also be implicated by such a use.[4] The closer a song is tied to the image or message of the candidate or campaign, the more likely it is that the artist can successfully sue under these rights.[5] The list below includes several examples of attempts to connect a song with a campaign’s image or message.

Further, if a campaign wishes to use a song in an ad, they must usually obtain both a sync license and a master use license. To learn more about the various types of music licenses that exist, see our blog on the topic. The campaign will likely need to contract with the song’s publisher and the artist’s record label in order to obtain the necessary licenses. The publisher, record label, and artist can decide if and how they want the artist’s music associated with a particular political campaign. The list below contains an example of a campaign allegedly using a song in an ad without obtaining the necessary licenses.

A campaign could also attempt to use a song in an ad without licenses under copyright fair use principles. There is no clear line between what is a fair use and what is not; an evaluation of fair use involves considering: (1) the purpose and character of the use, (2) the nature of the copyrighted work, (3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole, and (4) the effect of the use upon the potential market for or value of the copyrighted work.[6] However, testing a campaign’s copyright fair use of a song in a given ad would not come until a lawsuit was filed by the copyright owner; and campaigns—wishing to avoid unnecessary expenses and complications—are far more likely to seek the necessary licenses rather than risk litigation.

Finally, artists have the simple power of leveraging their fame and platform to pressure campaigns into ceasing the use of their music, either through the media, a cease and desist letter, or any other means to affect the desired outcome. In such instances, campaigns usually comply with the artists to avoid risking a public relations issue, to minimize embarrassment to the campaign or candidate, etc.

Here are five notable clashes between musical artists and political campaigns.

1. Bruce Springsteen v. Ronald Reagan, Bob Dole, Pat Buchanan, and All of America

Pretty much since the initial release of the Boss’ 1984 hit single, “Born in the U.S.A,” Americans of all stripes have been misinterpreting and misapplying the song. It is easy to mistake the song, with its rousing chorus, as a full-throated expression of patriotism and pride in being born in the United States, but the actual lyrics of the song espouse a darker and far more cynical outlook on American life. The song follows a young American from small town America, to the jungles of Vietnam, back to his small town, with all of the trials and tribulations along the way.[7]

Springsteen himself has long been associated with the Democratic Party and has repeatedly expressed his displeasure with Republican candidates for president using his songs—especially “Born in the U.S.A.”[8] President Reagan’s campaign asked Springsteen if they could use the song in the President’s 1984 reelection, but Springsteen refused—an example of a campaign hoping to center a song as a theme of the campaign. Bob Dole in 1996 and Pat Buchanan in 2000 each used the song until Springsteen publicly disavowed its use, and in response both campaigns stopped using the song. However, as long as we have Memorial Day parties, July 4th parties, Labor Day parties, and political campaigns, people will likely continue to misinterpret “Born in the U.S.A.”

2. John Mellencamp v. Ronald Reagan, George W. Bush, John McCain

Much like Bruce Springsteen, John Mellencamp is often mistakenly identified as a conservative based on his music and the central place the American heartland has in that music. However, Mellencamp has described himself “as left-wing as you can get,” and has performed for Democratic political campaigns over the years.[9] That has not stopped the likes of Ronald Reagan, George W. Bush, and John McCain from wanting to use his songs—most notably “Pink Houses”—at their political events. Mellencamp discouraged Reagan from using “Pink Houses” in his 1984 campaign when representatives for the campaign reached out, and he requested that the John McCain campaign stop using “Our Country” and “Pink Houses” at his events during the 2008 Republican primary. Additionally, Mellencamp requested that Bush stop using “R.O.C.K in the U.S.A” in 2000, and in each of these instances, the campaigns agreed to either stop using the songs or not use them in the first place.[10]

3. Nickelback v. Donald Trump

In October 2019, President Trump tweeted out an edited clip from Canadian rock band Nickelback’s 2005 hit “Photograph” that depicted lead singer Chad Kroeger holding a photo of then-Vice President Joe Biden, his son, and a Ukrainian gas company board member.[11] Less than a day after being tweeted out, the clip itself was removed by Twitter after they received a copyright complaint filed on behalf of Nickelback by Warner Music Inc.[12] It would have been interesting to see whether President Trump’s clip amounted to a fair use of both the song and music video, but the use of Twitter’s copyright complaint system does not require an evaluation of fair use.

4. Sam Moore v. Barack Obama

During the 2008 presidential election, the Obama campaign took to playing Sam Moore’s “Hold on, I’m Comin” at rallies, during which attendees would sing, “hold on, Obama’s comin’.”[13] The soul music legend himself wrote a letter requesting that they stop using the song because he had not endorsed Obama for president and did not want their use of his song to be mistaken as such an endorsement.[14] The Obama campaign stopped using the song and Moore would eventually go on to perform at President Obama’s inaugural ball in 2009.[15]

5. David Byrne v. Charlie Crist

During his 2010 campaign for a Senate seat in Florida against Marco Rubio, former Florida governor Charlie Crist used the Talking Heads song “Road to Nowhere” in an attack ad against Rubio.[16] Talking Heads lead singer and songwriter, David Byrne, then filed a lawsuit against Charlie Crist for the unauthorized use of the band’s song, alleging that the Crist campaign had not acquired the proper licenses. In 2011, the lawsuit was settled between the two out of court, with Crist releasing a video to YouTube apologizing for the whole incident. In a statement released by Byrne alongside the announcement of the settlement, he confessed his surprise upon learning that the unauthorized use of pop songs in political ads was very common in the United States.[17] If only we had written this article nine years ago for Mr. Byrne, he would have been less surprised.


[1] Using Music in Political Campaigns: What you should know, ASCAP (accessed Nov. 19, 2020), https://www.ascap.com/~/media/files/pdf/advocacy-legislation/political_campaign.pdf.

[2] Id.

[3] Id.

[4] Id.

[5] Id.

[6] Ask the alliance, Copyright Alliance (accessed Nov. 19, 2020), https://copyrightalliance.org/ca_faq_post/political-campaign-music-other-copyrighted-works/.

[7] Josh Terry, Politicians Have Always Misunderstood Springsteen’s ‘Born in the U.S.A,’ Vice (Oct. 5, 2020), https://www.vice.com/en/article/pkyjvn/misunderstood-bruce-springsteens-born-in-the-usa-trump.

[8] Id.

[9] Eveline Chao, Stop Using My Song: 35 Artists Who Fought Politicians Over Their Music, Rolling Stone (Jul. 8, 2015), https://www.rollingstone.com/politics/politics-lists/stop-using-my-song-35-artists-who-fought-politicians-over-their-music-75611/bruce-springsteen-vs-ronald-reagan-bob-dole-and-pat-buchanan-28730/.

[10] Id.

[11] Emma Specter, Donald Trump vs. Nickelback: The Twitter Feud Nobody Was Expecting, Vogue (Oct. 3, 2019), https://www.vogue.com/article/donald-trump-nickelback-photograph-meme-takedown.

[12] Devan Cole and Donie O’Sullivan, Twitter removes Trump’s Nickelback video after copyright complaint, CNN (Oct. 3, 2019), https://www.cnn.com/2019/10/03/politics/twitter-donald-trump-nickelback-tweet-copyright-complaint-trnd/index.html.

[13] Eveline Chao, Stop Using My Song: 35 Artists Who Fought Politicians Over Their Music, https://www.rollingstone.com/politics/politics-lists/stop-using-my-song-35-artists-who-fought-politicians-over-their-music-75611/bruce-springsteen-vs-ronald-reagan-bob-dole-and-pat-buchanan-28730/.

[14] Stephen Davis, Do Rock Stars Dislike Democrats, Too?, Slate (Jun. 30, 2011), http://www.slate.com/blogs/browbeat/2011/06/30/has_a_rock_star_ever_sued_a_democrat_for_using_a_song_in_a_campa.html.

[15] Eveline Chao, Stop Using My Song: 35 Artists Who Fought Politicians Over Their Music, https://www.rollingstone.com/politics/politics-lists/stop-using-my-song-35-artists-who-fought-politicians-over-their-music-75611/bruce-springsteen-vs-ronald-reagan-bob-dole-and-pat-buchanan-28730/.

[16] Matthew Perpetua, David Byrne Wins Settlement Over Unauthorized Political Ad, Rolling Stone (Apr. 12, 2011), https://www.rollingstone.com/music/music-news/david-byrne-wins-settlement-over-unauthorized-political-ad-188523/.

[17] Id.

China Updates Patent Law with New Amendments

by Matt Digan

For the fourth time since the original patent law of China was promulgated in 1984, the National People’s Congress of China approved new amendments on October 17, 2020 that will take effect June 1, 2021. The new amendments primarily concern design patents, pharmaceutical patents, and various changes to damages.[1]

Design Patents

The three significant changes to design patent law in China are that “partial designs” are now permitted, the term of protection for design patents has been increased from 10 to 15 years, and priority claims are not available to applicants. A partial design patent refers to the practice of patenting just a portion of a design, rather than the entire design.[2] Partial designs are already permitted in many other jurisdictions around the world, such as in Europe, Japan, the Republic of Korea, the UK, and the US.[3] Some commentators have noted that China’s extension of design patent protection to 15 years may signal the country’s desire to join the Hague System for the International Registration of Industrial Designs overseen by the World Intellectual Property Organization (WIPO).[4] The final change to the design patent landscape in China is that an applicant may now claim priority within six months from the date on which the applicant first files in China.[5]

Pharmaceutical Patents

The new amendments include a patent term extension for pharmaceutical patents to compensate for the long regulatory review periods that effectively reduce the term of protection for such patents. The maximum term extension is 5 years and no pharmaceutical patent approved under the new law shall have a total term of protection that exceeds 14 years.[6]

Another new addition to the pharmaceutical patent landscape in China is an early dispute resolution mechanism for use when an applicant for a new drug has a dispute with a patent holder. Under the new system, the applicant for the new drug or the patent holder may file a complaint with either the local patent administrative office or the people’s court for a decision on whether the drug-related technical solutions for which the drug is to be approved falls within the scope of protection of the patent rights.[7] Then, in accordance with the decision of the people’s court, China’s equivalent of the Food and Drug Administration (FDA) may decide whether to suspend the approval of the drug.[8]

Damages

In each new round of amendments to the Chinese patent law system, the country has increased the limit on damages in some fashion—the new amendments are no different.[9] First, China has increased the maximum amount of punitive damages for willful infringement to up to five times actual damages.[10]

Second, China has increased statutory damages for patent infringement cases to between ¥30,000 and ¥5,000,000 (the equivalent of ~$4,500 and ~$757,000, respectively).[11] In China, the damages that tend to be awarded in patent infringement cases are statutory damages and not actual damages due to the challenges in proving loss or profit.[12] That being the case, such an increase in statutory damages will likely have a significant practical impact on patent litigation.[13]

Third, and directly related to the previously noted challenges in proving loss or profit, the new amendments grant judges the power to order defendants to disclose damage-related evidence. If the defendant refuses or provides false information, the judge has discretion to decide damages based on the patentee plaintiff’s claim or request.[14] Evidently, in China it has been common practice in patent infringement litigation for defendants to refuse to disclose financial records related to the alleged infringement, so such a change in the law may go a long way in combating that litigation tactic.

Other Changes

Another significant change to China’s patent laws is the introduction of an open licensing system. A patentee can declare and record its intention to open license its patent(s) to any entity or individual with the Chinese National Intellectual Property Administration (CNIPA) and also set the license fees and terms.[15]

Other changes include clarification on the roles of local IP offices under CNIPA and the three specialized IP courts in Beijing, Shanghai, and Guangzhou in enforcing patent rights. Additionally, the amendments have created an option for applicants to request patent term extensions if an application has been pending for more than 4 years since the filing date or if it has been more than 3 years since a request for substantive examination.[16]


[1] See Jian Xu, Ten Highlights of China’s New Patent Law, Gowling WLG (Oct. 21, 2020), https://gowlingwlg.com/en/insights-resources/articles/2020/ten-highlights-of-china-s-new-patent-law/#:~:text=China%20will%20introduce%20the%20%22open,patent%20annuities%20can%20be%20waived; Ningling Wang, Promoting Innovation with Enhanced Protection and Enforcement Measurements under New Chinese Patent Law, Finnegan (Oct. 23, 2020), https://www.finnegan.com/en/insights/blogs/prosecution-first/promoting-innovation-with-enhanced-protection-and-enforcement-measurements-under-new-chinese-patent-law.html; Li Mi, New Amendments to the Chinese Patent Law Revealed, Rouse (Oct. 23, 2020), https://rouse.com/insights/news/2020/new-amendments-to-the-chinese-patent-law-revealed.

[2] Alisa S. Abbott and Robert S. Katz, Protecting and enforcing design rights: United States, World Trademark Review (Dec. 11, 2017), https://www.worldtrademarkreview.com/portfolio-management/protecting-and-enforcing-design-rights-united-states.

[3] Jian Xu, Ten Highlights of China’s New Patent Law, https://gowlingwlg.com/en/insights-resources/articles/2020/ten-highlights-of-china-s-new-patent-law/#:~:text=China%20will%20introduce%20the%20%22open,patent%20annuities%20can%20be%20waived.

[4] See Id.; Li Mi, New Amendments to the Chinese Patent Law Revealed, https://rouse.com/insights/news/2020/new-amendments-to-the-chinese-patent-law-revealed.

[5] Ningling Wang, Promoting Innovation with Enhanced Protection and Enforcement Measurements under New Chinese Patent Law, https://www.finnegan.com/en/insights/blogs/prosecution-first/promoting-innovation-with-enhanced-protection-and-enforcement-measurements-under-new-chinese-patent-law.html.

[6] Jian Xu, Ten Highlights of China’s New Patent Law, https://gowlingwlg.com/en/insights-resources/articles/2020/ten-highlights-of-china-s-new-patent-law/#:~:text=China%20will%20introduce%20the%20%22open,patent%20annuities%20can%20be%20waived.

[7] Ningling Wang, Promoting Innovation with Enhanced Protection and Enforcement Measurements under New Chinese Patent Law, https://www.finnegan.com/en/insights/blogs/prosecution-first/promoting-innovation-with-enhanced-protection-and-enforcement-measurements-under-new-chinese-patent-law.html.

[8] Id.

[9] Jian Xu, Ten Highlights of China’s New Patent Law, https://gowlingwlg.com/en/insights-resources/articles/2020/ten-highlights-of-china-s-new-patent-law/#:~:text=China%20will%20introduce%20the%20%22open,patent%20annuities%20can%20be%20waived.

[10] Id.

[11] Ningling Wang, Promoting Innovation with Enhanced Protection and Enforcement Measurements under New Chinese Patent Law, https://www.finnegan.com/en/insights/blogs/prosecution-first/promoting-innovation-with-enhanced-protection-and-enforcement-measurements-under-new-chinese-patent-law.html.

[12] Jian Xu, Ten Highlights of China’s New Patent Law, https://gowlingwlg.com/en/insights-resources/articles/2020/ten-highlights-of-china-s-new-patent-law/#:~:text=China%20will%20introduce%20the%20%22open,patent%20annuities%20can%20be%20waived.

[13] Id.

[14] Id.

[15] Id.; Ningling Wang, Promoting Innovation with Enhanced Protection and Enforcement Measurements under New Chinese Patent Law, https://www.finnegan.com/en/insights/blogs/prosecution-first/promoting-innovation-with-enhanced-protection-and-enforcement-measurements-under-new-chinese-patent-law.html.

[16] Jian Xu, Ten Highlights of China’s New Patent Law, https://gowlingwlg.com/en/insights-resources/articles/2020/ten-highlights-of-china-s-new-patent-law/#:~:text=China%20will%20introduce%20the%20%22open,patent%20annuities%20can%20be%20waived.

Amazon launches Counterfeit Crimes Unit

by Chris Kang

Photo by Yender Gonzalez on Unsplash

On June 24, 2020, Amazon established the Counterfeit Crimes Unit in its continuing effort to fight against counterfeit listings in its marketplace through a team consisting of former federal prosecutors, investigators, and data analysts.[1]

In the past, Amazon’s issues with counterfeit listings have resulted in both legal and partnership concerns. Notably, Williams-Sonoma, a kitchenware and home furnishing retail company, sued Amazon for trademark infringement and dilution resulting from counterfeits listed on Amazon’s marketplace.[2] The problem of counterfeit listings has also led Nike, an athletic sneaker and apparel retailer, to end a pilot program offering select items on Amazon.[3] Nike stated in its statement regarding the program’s termination, “We will continue to invest in strong, distinctive partnerships for Nike with other retailers and platforms to seamlessly serve our consumers globally.”[4]

Amazon previously sought to protect intellectual property rights by establishing the Amazon Brand Registry in 2017, a service that gives rights owners a higher degree of control over their brands on the Amazon marketplace.[5] The following year, Amazon initiated the Utility Patent Neutral Evaluation Procedure, a program that allows patent holders to accuse alleged infringers while also giving the accused infringers the opportunity to defend themselves against wrongful accusations. In 2019, Amazon introduced Project Zero to further combat counterfeit listings by automating the removal of suspected counterfeits while allowing brand owners to unilaterally remove counterfeit listings.[6]

According to Amazon, the new Counterfeit Crimes Unit continues to advance Amazon’s focus on preventing counterfeit listings by proactively conducting internal investigations and seeking legal recourse against suspected counterfeiters.[7] The Unit investigates instances where suspected counterfeiters attempt to circumvent Amazon’s safeguards and list fraudulent goods.[8] Once an investigation is initiated, the Unit then analyzes both Amazon’s internal data and information from external resources to link fraudulent listings with counterfeiters so that they may be held accountable through legal action.[9] Dharmesh Mehta, Amazon’s Vice President of Customer Trust and Partner Support said: “Every counterfeiter is on notice that they will be held accountable to the maximum extent possible under the law, regardless of where they attempt to sell their counterfeits or where they’re located.”[10]

Amazon has already demonstrated its willingness to take legal action against bad actors in a recent lawsuit where counterfeiters used social media to bypass Amazon’s measures against counterfeit listings.[11] Although the Unit’s efforts remain to be fully seen, if successful, will allow Amazon to better aid both brands and law enforcement in the ongoing battle against counterfeit goods.


[1] https://press.aboutamazon.com/news-releases/news-release-details/amazon-establishes-counterfeit-crimes-unit-bring-counterfeiters

[2] Williams-Sonoma, Inc. v. Amazon.com, Inc., No. 18-CV-07548-EDL, 2019 WL 7810815, at *1 (N.D. Cal. May 2, 2019)

[3] https://www.bloomberg.com/news/articles/2019-11-13/nike-will-end-its-pilot-project-selling-products-on-amazon-site

[4] Id.

[5] https://blog.aboutamazon.com/policy/protecting-customer-trust

[6] https://blog.aboutamazon.com/company-news/amazon-project-zero

[7] https://press.aboutamazon.com/news-releases/news-release-details/amazon-establishes-counterfeit-crimes-unit-bring-counterfeiters

[8] https://press.aboutamazon.com/news-releases/news-release-details/amazon-establishes-counterfeit-crimes-unit-bring-counterfeiters

[9] Id.

[10] Id.

[11] https://press.aboutamazon.com/news-releases/news-release-details/amazon-files-lawsuit-against-counterfeiters-using-social-media

The Masters: A Trademark Unlike Any Other

by Matt Digan

As of March 3, 2020, Augusta National, Inc. possesses a federally registered trademark in the iconic green and gold color scheme for the jackets that have become synonymous with The Masters Tournament and professional golfing excellence generally. While Augusta National, Inc. had already successfully registered “GREEN JACKET” as a trademark, among other registrations, it did not own any rights in the design and color scheme of its famous jackets.[1]

Specifically, the description of the trademark states that, “[t]he mark consists of the colors green and gold where the color green is applied to the jacket and the color gold is applied to the three waist buttons and the two sleeve buttons on each arm of the jacket.”[2] The Registration is for International Class 035 (“promotion of goods and services through sponsorships of sports events”) and International Class 041 (“organizing and conducting golf tournaments”).[3]

While the registration of a color or color scheme in connection with goods has been quite common for some time, Augusta National, Inc.’s registration of a color scheme in connection with a service demonstrates the development of source identification and what may be possibly registered as a trademark with the USPTO.[4]

The 2020 Masters Tournament was postponed in early March from its usual first weekend in April spot to November 12-15 due to the ongoing global COVID-19 pandemic. Regardless of who wins this weekend, the winner will be donning the green jacket with the comfort of knowing it is protected under federal trademark law.


[1] Susan Neuberger Weller, The Masters’ Green Jacket is Now a Registered Trademark, Mintz (Mar. 10, 2020), https://www.mintz.com/insights-center/viewpoints/2231/2020-03-10-masters-green-jacket-now-registered-trademark.

[2] Id.

[3] Quarles & Brady LLP, Augusta National Blazes a Trail to Registration of its Iconic Green Jacket, Lexology (Nov. 10, 2020), https://www.lexology.com/library/detail.aspx?g=67f04f92-bad5-4365-9f3c-63a526eae3e9&utm_source=Lexology+Daily+Newsfeed&utm_medium=HTML+email+-+Body+-+General+section&utm_campaign=AIPLA+2013+subscriber+daily+feed&utm_content=Lexology+Daily+Newsfeed+2020-11-12&utm_term=.

[4] Id.


Federal Circuit Determines Claims Not Fully Adjudicated Need to Be Substantially Unreasonable when Granting Attorney’s Fees in Patent and Trademark Infringement Cases

by Chris Kang

            The Federal Circuit recently reversed a decision by the US District Court for the Central District of California granting attorney’s fees on the basis that the underlying patent and trademark infringement claims were not unreasonable.[i] Writing for the panel, Circuit Judge Raymond Chen found that the district court abused its broad discretion in its determination of exceptionality.[ii]

Munchkin sued Luv n’ Care (LNC) for trademark infringement and unfair competition claims against LNC’s “CLICK LOCK” spillproof cups.[iii] Following the initial suit, the district court granted Munchkin leave to amend its complaint, adding additional trademark and trade dress infringement claims as well as a claim for patent infringement directed to U.S. Patent No. 8,739,993 (’993 patent).[iv] During litigation, Munchkin voluntarily dismissed its non-patent claims while a parallel proceeding at the Patent Trial and Appeal Board (PTAB) brought by LNC invalidated the ’993 patent.[v] Following the Federal Circuit’s decision affirming the invalidation, Munchkin dismissed its patent infringement claims.[vi] Subsequently, LNC sought attorney fees under 35 U.S.C. § 285 for the patent infringement claim and 15 U.S.C. § 1117(a)(1) for the trademark and trade dress claims.[vii] The district court granted LNC the attorney fees, finding that the case was exceptional because Munchkin’s claims of infringement were “substantially weak.”[viii]

            On appeal, the Federal Circuit reversed the district court’s grant of attorney’s fees finding that none of LNC’s claims were an exceptional case. Under Section 285 of the Patent Act and Section 1117(a)(1) of the Lanham Act, a court may grant attorney’s fees to the prevailing party in “exceptional cases” for patent infringement and trademark infringement, respectively.[ix] In the precedential decision of Octane Fitness LLC v. ICON Health & Fitness Inc., the Supreme Court defined an exceptional case in patent suits as “one that stands out from others with respect to the substantive strength of a party’s litigating position (considering both the governing law and the facts of the case) or the unreasonable manner in which the case was litigated” under the totality of the circumstances.[x]

Following the Supreme Court’s exceptional case standard set out in Octane, the Federal Circuit rejected the district court’s opinion that Munchkin had acted unreasonably.[xi] Instead, it found that there was no evidence that the case was exceptional under Section 285 and determined “the district court’s finding to the contrary was an abuse of discretion.”[xii]

The Federal Circuit further found that the district court’s decision granting attorney’s fees for the trademark infringement claims contradicted its earlier decision granting Munchkin’s motion to amend its complaint, reasoning that Munchkin should not be found liable for “litigating a claim it was granted permission to pursue.”[xiii] Furthermore, the Federal Circuit held that the trade dress claim was not adequately litigated to determine whether Munchkin’s claims were substantially unreasonable.[xiv] Consequently, the Federal Circuit determined that the arguments made by LNC for its fee motion in the trade dress infringement claim was conclusory, and therefore not exceptional.[xv]


[i] Munchkin, Inc. v. Luv n’ Care, Ltd., 960 F.3d 1373 (Fed. Cir. 2020).

[ii] Id.

[iii] Id.

[iv] Id.

[v] Id.

[vi] Id.

[vii] Id.; 35 U.S. Code § 285; 15 U.S. Code § 1117(a)(1).

[viii] Munchkin, Inc. v. Luv n’ Care, Ltd., 960 F.3d 1373 (Fed. Cir. 2020).

[ix] 35 U.S. Code § 285; 15 U.S. Code § 1117(a)(1).

[x] Octane Fitness, LLC v. ICON Health & Fitness, Inc., 572 U.S. 545, 545, 134 S. Ct. 1749, 1751, 188 L. Ed. 2d 816 (2014).

[xi] Munchkin, Inc. v. Luv n’ Care, Ltd., 960 F.3d 1373 (Fed. Cir. 2020).

[xii] Id.

[xiii] Id.

[xiv] Id.

[xv] Id.

FTC v. Qualcomm: Qualcomm’s Anti-Trust Victory Could Lead to Patent Difficulty

by: Tuong Pham

            The Ninth Circuit has recently ruled in favor of Qualcomm in its long battle against the Federal Trade Commission (FTC). On August 11, 2020, the three-judge panel unanimously reversed the decision of the district court finding in favor of the FTC.[1] The Ninth Circuit found that Qualcomm’s business policies did not violate anti-trust laws. FTC requested a rehearing en banc with the Ninth Circuit on September 25, 2020, but on October 28, 2020, the Ninth Circuit declined to rehear the case.

Background:

            Qualcomm holds patent portfolios for many stand essential patents (SEPs) for cellular technology found in most smartphone devices including 4G standards. A large portion of Qualcomm’s business involves licensing the patents to original equipment manufacturers (OEMs) like cellphone manufacturers. To maximize revenue, Qualcomm only licenses to the OEMs instead of chip suppliers to prevent patent exhaustion.[2] Additionally, Qualcomm also manufactures and sells cellular modern chips required to practice the technology standards to OEMs. OEMs must follow a “no license, no chips” policy by Qualcomm because Qualcomm refuses sell its chips if the OEMs do not have a license.

            Chip manufacturers including rivals, who supply the licensed OEMs with Qualcomm chips are essentially granted a covenant not to sue. Qualcomm promises not to assert its patents if the chip manufacturer promises not to sell its chips to unlicensed OEMS in the “CDMA ASIC Agreements.”[3] Qualcomm allows the chip supplier to manufacture the chips without royalty payments as long as they report supply agreements with OEMs to Qualcomm as well.

The Ninth Circuit Opinion

            The Ninth Circuit unanimously found that FTC failed to prove that Qualcomm’s business practices caused any antitrust violations. The court found that Qualcomm’s refusal to license its patents to rival chip manufacturers is not an antitrust violation. Qualcomm fails to single out any specific chip manufacturer but provides the “CDMA ASIC Agreements” to allow chip suppliers the ability to practice Qualcomm’s patents without fear of enforcements. Qualcomm’s policy of “no license, no problem,” is applied neutrally to all competing chip manufacturers.[4]   

The “no license no chips” policy is permissible. The court found no harm in the relevant markets. The court refused to determine if the royalty rates were too high. If the royalty rates were too high, the potential harm would be to Qualcomm’s customers and not Qualcomm’s competitors, thus being outside the relevant markets.[5] Qualcomm’s royalties were “chip-supplier neutral” because the royalty rates were based on the OEMs’ licensing agreement without any relevance to where the OEMs got their chips from. Although the royalty rates may be high, OEMs can purchase Qualcomm chips or a rival’s chips.

Potential Problems for Qualcomm:

            Although, the court ruled in favor of Qualcomm under antitrust, Qualcomm might be facing future patent exhaustion problems.[6] Patent exhaustion can occur when any licensed manufactured product is sold. The patent is exhausted for the sold product and the patent owner is then unable to sue for infringement. Patent exhaust occurs for all downstream purchases of the patented product. In this case, if Qualcomm had licensed the chip manufacturers, the patent would be exhausted when the chip manufacturer sold the patent chips to the OEMs. Therefore in this scenario, Qualcomm could not assert its patent against OEMs who did not license their products. Qualcomm’s business strategy attempts to avoid this pitfall and require the license to the OEMs themselves.

            The Ninth Circuit opinion found Qualcomm’s business strategy valid. However, the problem occurs because Qualcomm might be giving the chip manufacturers a legal license. The Ninth Circuit also wrote that the “’CDMA ASIC Agreements’ functionally act as de facto licenses.”[7] Although, the “CDMA ASIC Agreements” appear like a covenant not to sue, in recent years, courts have found little distinguishing differences between a covenant not to sue and a license. In Ortho Pharm. Corp. v. Genetics Institute, Inc., the court stated “A license may amount to no more than a covenant by the patentee not to sue the licensee for making, using or selling the patented invention.”[8] If the chip manufacturers have a valid license, then the OEMs can use and purchase those chips without having to pay any royalties to Qualcomm because the patent would be exhausted. The Ninth Circuit only dealt with antitrust issues, but the patent exhaustion issue might be a topic for the future.

            Currently, Qualcomm has won a victory for their practices in the Ninth Circuit. The Ninth Circuit has already declined to rehear the case, but the FTC still have the option to appeal to the Supreme Court.


[1] FTC v. Qualcomm Inc., 969 F.3d 974 (9th. Cir. 2020).

[2] Id. at 984

[3] Id.

[4] Id. at 995.

[5] Id. at 1002.

[6] Jason Rantanen, “No License, No Problem” – Is Qualcomm’s Ninth Circuit Antitrust Victory a Patent Exhaustion Defeat? https://patentlyo.com/patent/2020/09/qualcomms-antitrust-exhaustion.html

[7] Id. at 996.

[8] 52 F.3d 1026, 1031 (Fed. Cir. 1995).