Archive for April, 2011

Google’s Groupon Clone Already Involved in a Patent Infringement Case

Saturday, 30 April, 2011 14:47 Written by Mark Malek 0 Comments
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By: Mark R. Malek

As you may recall, I reported a few months ago that Groupon turned down a $6 billion offer for purchase made by Google.  To this day, I just can’t figure out why?  I have not researched the actual offer, but it must have not been in real dollars.  Maybe it was for $6 Billon worth of bacon gristle, or something along those lines.

As most anyone could have predicted, after being snubbed by Groupon, Google turned its programmers lose to come up with a similar type of site.  Seeing as how most all computers have Google as a homepage, I am sure that they would be able to capture a huge market share.  It apparently did not take long for Google to complete an initial version of the coupon site.  A beta test of the new site was announced for Portland, Oregon.

No sooner than the beta test was announced, however, was Google sued for patent infringement.  Any guesses on the Plaintiff?  That’s right – the same company that has sued everyone over the past month – Walker Digital (source).  A copy of the complaint is available at GameTimeIP.com.

It is interesting to note Walker Digital seeks damages in this suit.  I understand the request for entry of an injunction and for an award of attorneys’ fees, but I am not too sure that I understand what damages there are yet.  Google has not even launched their site, so there are no possible damages.  From the strategy perspective, however, Walker Digital has to ask for damages.  If they do not, then there is no possible way for them to recover damages if it turns out that damages are discovered during the litigation process.

Mattel Slammed In Bratz Litigation

Friday, 29 April, 2011 01:23 Written by Aaron B. Thalwitzer 0 Comments
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Aaron Thalwitzer

Juries. As I may have previously mentioned, I really like them. They can even the playing field, whether it’s man versus the state, man versus man, or mega-corporation versus smaller-but-still-pretty-big-corporation.

Case in point: toy titan Mattel just got slapped down by toy has-been MGA Entertainment Inc., maker of Bratz dolls, to the tune of $88.5 million in damages. The question of whether the designer invented the trademarks related to Bratz on his own time or in the course of his employment with Mattel was decided by some people off the street, who found willful misappropriation of trade secrets by Mattel. The jury decided that the “inventions” weren’t made “at any time during his employment”.

MGA is now asking for treble damages based on said willfulness.

Mattel can rest easy however, since the jury did find that MGA had interfered with Mattel’s contract with the designer of the Bratz line, and awarded Mattel $10,000 in damages. Woo-hoo!

This case has been going on for seven years, since 2004, back when Bratz were still cool among seven-year-old girls wearing lots of make-up. Basically, Mattel accused MGA of stealing its designs by hiring a key employee.

“We remain committed to protecting the intellectual property that is at the heart of business success,” Mattel CEO Robert Eckert said afterwards via email.

Mattel will move for a new trial, which is rarely granted, and then appeal.

What we can all take from this is to get a good lawyer to draw up your employment contracts, preferably one that knows a thing or two about intellectual property. The designer in question had an employment contract with Mattel, but the provision regarding assignment of inventions was ambiguous – therefore, it was a question of fact and for the jury to decide. If you’re a company, big or small, there’s no excuse for bad contracts, unless you’d rather have a jury figure out what you meant.

This is a complete reversal of the previous jury trial. In 2008 MGA was ordered to pay Mattel $100 million, which was thrown out on appeal last year, allowing MGA a second bite at the apple, and a chance to formulate a new strategy.

So, MGA accused Mattel of forging credentials to sneak into toy fairs to steal trade secrets and of concealing evidence of these activities. Apparently, even toy biz IP is rife with corporate espionage.

According to Jack Lerner, a professor at USC Gould School of Law, this new evidence permitted by the Appeals Court allowed MGA to present a “large canvas” to the jury on retrial, whereas the first trial was more restricted in scope.

As usual, Mattel had a chance to settle this thing but took the litigation route, for which the markets are now punishing them. Better luck next time.

For more information see Mattel Inc. v. MGA Entertainment, Inc., No. CV 04-09049-DOC (RNBx) (C.D. Calif.).

Non-Lawyer legal services : you get what you pay for – Part 1 – The Service

Thursday, 28 April, 2011 07:14 Written by Scott Nyman 3 Comments
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Scott Nyman

When speaking with potential client, I often get asked, “So why shouldn’t I just use a service like LegalZoom?” This is a big question, and requires a big answer. So big, in fact, that I will answer this question in a series of articles over the next couple weeks.

In this series of articles, I will discuss what online legal document generation services really provide its customers. I will compare the document generation services, such as LegalZoom, to the hiring of a Bar licensed attorney. I will cover these differences in five topics based articles: 1) the service provided; 2) the work product; 3) the guarantee (or lack thereof); 4) the value; and, since I deal with patents and other intellectual property, 5) using sites such as LegalZoom for patents, trademarks, and copyrights.

And before you bring it up, yes, I am a lawyer and I do make a living by providing legal services to (paying) clients. However, I only provide my services to advise clients that will benefit legal representation. If a person isn’t ready for a patent, or if they are trying to patent the common fork, I will inform them that they do not yet require the services of a patent attorney.

Without any further introduction, let’s start the discussion and comparison of the services rendered by online legal document generation services versus that of an attorney.

So, what to you get when you hire an attorney?

First, you get a licensed professional that has dedicated a large part of his or her life learning the law as it relates his or her area of practice. If the attorney does not fully know the particular law as it may apply to your individual legal issue (and there are a lot of laws), he or she will have the skill to research the law for an answer. The attorney will likely also review Court decisions and treatises to ensure the answers found are still the law, as they have interpreted by the courts.

Second, when hiring an attorney, you get a human being that is capable of listening to the facts regarding your specific legal matter, apply those facts to the law, critically analyze your facts at they apply to the law, and come to a legal conclusion, from which they may advise the client. As a bonus, conversations between you and your attorney are protected by the attorney-client privilege, unless that privilege is waived by the client (please, don’t post details about your legal matter on Facebook!!!).

Third, when hiring an experienced attorney, you get a person with insight on how a case or procedure will likely play out. For example, when applying for a patent, you will likely receive a first office action from the USPTO rejecting your patent on obviousness. An experienced patent attorney will expect this and, due to his experience dealing with patent Examiners, be able to submit an argument to the Examiner that may likely overcome the rejection. This is why experienced attorneys typically charge more.

Fourth, as an attorney creates your legal documents, he or she is likely to be continually thinking “how can I make this document withstand a challenge in the courts by another party.” For example, when I am drafting a patent application for a client, I always consider how a litigator would try to invalidate or claim non-infringement on my patent. With those considerations, I tighten or broaden the document where necessary. It would be a shame to lose a multi-million dollar patent infringement lawsuit because you claimed a square peg, the defendant argues their peg is more “diamondish,” and prosecution history estoppel is preventing you from being protected under the doctrine equivalents (see Festo Corp. v Shoketsu Kinzoku Kogyo Kabushiki Co., 535 U.S. 722).

So, had enough on why lawyers are great? What do you get with an online legal document generation services, such as LegalZoom? To avoid appearing biased, I am just going to quote from terms and conditions of the most popular online legal document generation service, LegalZoom (http://www.legalzoom.com/terms-of-use.html).

LegalZoom.com provides an online legal portal to give visitors a general understanding of the law and to provide an automated software solution to individuals who choose to prepare their own legal documents. To that extent, the Site includes general information on commonly encountered legal issues. LegalZoom’s Services also include a review of your answers for completeness, spelling and grammar, and for internal consistency of names, addresses and the like. At no time do we review your answers for legal sufficiency, draw legal conclusions, provide legal advice or apply the law to the facts of your particular situation. LegalZoom and its Services are not substitutes for the advice of an attorney.

LegalZoom strives to keep its legal documents accurate, current and up-to-date. However, because the law changes rapidly, LegalZoom cannot guarantee that all of the information on the Site is completely current. The law is different from jurisdiction to jurisdiction, and may be subject to interpretation by different courts. The law is a personal matter, and no general information or legal tool like the kind LegalZoom provides can fit every circumstance. Furthermore, the legal information contained on the Site is not legal advice and is not guaranteed to be correct, complete or up-to-date. Therefore, if you need legal advice for your specific problem, or if your specific problem is too complex to be addressed by our tools, you should consult a licensed attorney in your area.

…

This Site is not intended to create any attorney-client relationship, and your use of LegalZoom does not and will not create an attorney-client relationship between you and LegalZoom. Instead, you are and will be representing yourself in any legal matter you undertake through LegalZoom’s legal document service.

And my personal favorite (which is has parts removed for emphasis):

LEGALZOOM MAKES NO WARRANTY THAT … THE RESULTS THAT MAY BE OBTAINED FROM THE USE OF THE SITE, OR ANY MATERIALS OFFERED THROUGH THE SITE, WILL BE ACCURATE OR RELIABLE.

I will let you draw your own conclusions.

…

Wegmans and Walgreens Settle Trademark Dispute of “W”

Wednesday, 27 April, 2011 21:23 Written by Mark Malek 0 Comments
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By: Mark R. Malek

Walgreens filed a trademark infringement lawsuit against Wegmans Food Markets over use of a “W” logo that Walgreens alleged to be so similar in nature that it would likely cause consumer confusion with the “W” logo that was registered as a trademark to Walgreens.  The claim was recently settled, and Wegmans has agreed not to use the “W” logo (source).

In a trademark infringement lawsuit, there is not necessarily a need to prove that actual confusion exists.  In other words, there is no need to show that one consumer was confused as to the source of the goods and services being offered.  Instead, there is a test that can be applied with several factors in order to determine whether or not there is a “likelihood of confusion.”  I came across a good post that points out the test for determining whether or not there exists a likelihood of confusion.  The very best quote in this post notes that when “determining likelihood of confusion, courts evaluate several factors. No one factor is determinative in and of itself, and how important one factor is over another is very case specific.”  Now you can understand why litigation takes so very long and can be so very expensive.  While one side may be arguing the merits and strengths of some of the factors, the other side is arguing how the other factors are not met and that, therefore, there is no infringement.

The factors that are analyzed include whether or not the marks compete with one another, whether or not they are used in the same channels of trade, whether or not the goods are closely related, whether or not the infringer intended to mislead the consumer, the similarity of the marks, whether or not the customers of the company are overlapping and whether or not there has been actual confusion.  Although actual confusion is only one of the factors, I believe it to be somewhat important.  Then again, there is not likely to be actual confusion standing alone, and only one instance of actual confusion is likely not enough to win the day.

Wegmans probably made a good choice.  There has to be a business decision that was made at some point.  I suspect that in the not too recent past, Wegmans, like many companies nowadays, went through some sort of marketing overhaul and someone probably suggested that it may be time to “update the logo.”  I also suspect that the person who suggested such a thing was shot down pretty quickly.  Now, Wegmans can revisit the rebranding.  All in all, this will probably wind up being a good thing for Wegmans – gives them a chance to “reinvent” themselves.  Please stay tuned – I will post more articles on the tests necessary to prove trademark infringement.

DR. DRE WINS COPYRIGHT BATTLE AGAINS DEATH ROW RECORDS

Tuesday, 26 April, 2011 17:17 Written by danieldavidson 1 Comment
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By Daniel Davidson

I’m sure Dr. Dre never diagnosed that he would one day have to fight for his music from the very record label that he helped hit the streets, but that is exactly what Dre had to do.  In a recent ruling by U.S. District Judge Christina Snyder, the Dr. was given the news that he had hoped for.  The Judge ruled that he wasn’t being properly compensated for his record “The Chronic.”

Don’t be alarmed my fellow listeners of the 1992 album, the ruling won’t cease sales of the album, it only entitles Dr. Dre to 100 percent of the online sales.  This could very well stem from the ruling that was recently handed down to the Rick James Estate.  You can read the full article here.  Basically, the Judge in the Rick James ruling said that digital downloads are more so a license and that the artists are entitled to 50 percent of the earnings instead of the 12-20 percent they are entitled to from a sale.

Dr. Dre has had to battle Death Row Records on many fronts since he left the label in 1996.  Ultimately, Death Row went bankrupt and was bought out and renamed WIDEawake Death Row Records.

Good game Dr. Dre.  Cheers.

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