Posts Tagged ‘cease and desist’

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By Daniel Davidson

The goodwill of a company is its most valuable asset, and when you think of goodwill you think of trademarks.  Well, maybe not, but McCarthy, the guru of trademarks, would.  In a recent letter authored by a senior trademark counsel for Jack Daniel’s, the strength and goodwill of the Jack Daniel’s marks were exactly what she was attempting to preserve.

Dubbed the “Nicest Legal Letter Ever,” the cease and desist letter sent to Patrick Wensink ever so nicely asked Mr. Wensink to remove the alleged infringing cover of his newly released book, Broken Piano for President.  The cover is very old no. 7ish.

It seems as though both parties are going to benefit from this overly kind assertion of trademark rights.  The new author is getting quite the free PR from this letter going viral and Jack Daniel’s is being held ahigh for their gracious tactics.  Trademark attorneys could even take a note on how to go about trademark policing.  Albeit, the letter does make for a good read, and an unrealistic example of what you would receive if you were trademark infringing perp.

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Matthew Inman, aka "The Oatmeal".

This one will be short and sweet, because (ironically, as you will see), other lawyers have already created excellent content which I want to share with you. An excellent content-provider site of which you may be aware, The Oatmeal, has recently been involved in what is best described as a feud with content reproducing website, FunnyJunk (which does not deserve a link), a site which generates over 10 million hits each day.

Short story long, the owner/operator of The Oatmeal, Matthew Inman, wrote a blog post deriding FunnyJunk for blithely mirroring virtually The Oatmeal’s entire website on its site and reaping advertising dollars all the way:

Here’s how FunnyJunk.com’s business operates:

  • Gather funny pictures from around the internet
  • Host them on FunnyJunk.com
  • Slather them in advertising
  • If someone claims copyright infringement, throw your hands up in the air and exclaim “It was our users who uploaded your photos! We had nothing to do with it! We’re innocent!”
  • Cash six-figure advertising checks from other artists’ stolen material

Inman concluded by concisely summing up the current state of Internet copyright enforcement: “I realize that trying to police copyright infringement on the Internet is like strolling into the Vietnamese jungle circa 1964 and politely asking everyone to use squirt guns. I know that if FunnyJunk disappeared, 50 other clones would pop up to take its place overnight, but I felt I had to say something about what they’re doing.” And really, Inman just wants attribution, “Just proper attribution; just give me a link!” he told ArsTechnica.

FunnyJunk whined that it’s content was uploaded by third-party users (true) and so it wasn’t responsible. Inman noted that even a DCMA takedown notice would likely be ineffective since other users would just re-upload the content (also true). Things went back and forth and all around the Internet.

Eventually, FunnyJunk lawyered up, hiring attorney Charles Carreon, who demanded all manner of things, including that an online fundraiser for The Oatmeal (and some worthy charities) be shut down for vague but ultimately nonsensical issues Carreon raised. Indie GoGo, the host of the fundraiser, flatly refused to shut it down, since there was nothing wrong with it, and Inman lawyered up.

Inman’s lawyer sent a well-written and researched response to Carreon, who has hopefully ended his ill-considered crusade against a beloved Internet cartoonist.

The lesson is clear. On the Internet, unless you have truly deep pockets, and often even then, the court of public opinion can be every bit as important as any court of law.

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By: Mark R. Malek

Anyone who knows me knows that I am an avid (and sometimes rabid) fan of the New York Jets.  Therefore, it is no surprise that my email inbox this morning was flooded with links to a story that Tim Tebow’s attorney has sent a cease & desist letter to a T-Shirt company that is making the T-Shirt pictured below.  The letter can be found here.

As we indicated in some previous articles, cease & desist letters are a good starting point for enforcing your intellectual property rights.  For more information, take a look at the articles here, here and here.  Some of these articles are directed to protecting your patent rights, and some are directed to protecting your trademark rights. Either way, a cease and desist notice is one in which the intellectual property owner merely informs the alleged infringer of their rights, and demands that any further infringement be stopped.

Back to the story at hand, as you can see, the shirt in question changes the current New York Jets logo to read “MY Jesus” instead of “NY Jets.”  So I guess my question is what intellectual property right is Tim Tebow attempting to protect?  The letter indicates that the shirt makes it appear as if Tim Tebow endorses the T-shirt company. Really?  I am trying to figure out why that would be.  Is Tim Tebow the only Jets fan that believes in Jesus (I can say for a fact he is not – I’m one!!)

Of course, when my anti-Jets fan friends (especially the dang Dolphin fans and the Patriot fans) found out about the story, it made for the same joke over and over again – Even Tim Tebow thinks he’s Jesus!  Aghh!  Enough already.  I suspect that young Mr. Tebow does not really understand the ins and outs of intellectual property law and why his overzealous attorney is sending out letters like this.  Granted, Tim Tebow, like the rest of us, does enjoy a right to his own likeness, but it is not as though there is a trademark issue here for Tim Tebow, and if this is about a right to his likeness, then what likeness is being protected.  Does he really think that a reference to Jesus in connection with football is a reference to him?  News flash – there have been plenty of very talented NFL players that believe in and worship Jesus long before Tim Tebow came around.

At best, there may be a trademark issue for NFL Properties, who I believe is the owner of all the NFL logos, or perhaps even the NY Jets.  There is likely even a copyright issue here.  Technically, the NY Jets logo (in all its glory) is afforded copyright protection.  Therefore, this T-shirt can technically be thought of as a derivative work.  With that in mind, not one of these intellectual property rights is Tim Tebow’s to assert.  To the owners of Chubby Tees – I would be pleased to respond to Mr. Tebow’s attorney for you.  Side note – Before the Florida Bar asks, I am not soliciting business…I just want to have some fun with the response to the attorney that thinks the name of Jesus is the same as an endorsement by Tim Tebow!

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As mentioned in my previous post, one strategy in enforcing your patent is to send an entity that is potentially infringing your patent what is called a “Cease and Desist” letter.  The letter has a few core purposes.

First, it provides “actual notice,” which is notifying the allegedly infringing party that you believe they are currently or are about to infringe on your patent.  In patent law, if an entity is infringing your patent, in certain circumstances they may not be liable for the infringement before they are provided with actual notice.  More specifically, if you are not properly marking your product with your patent number, actual notice is required.  Therefore, two elements that should be included in your cease and desist letter are 1) the number of your patent and 2) identification of the products or processes you believe may be infringing.

Second, cease and desist letters often initiate licensing negotiations.  Aside from or in addition to asking/demanding the allegedly infringing party cease their infringing activity, you may offer them a license to your patent, which would reduce the risk to them of the potential infringement liability.
Needless to say, when asking a party to stop their commercial activity and pay you money, the correct tone must be struck in order to create a favorable environment.  However, the need for setting the proper tone goes beyond establishing a good relationship.  A cease and desist letter may be construed by the receiving party as creating an “actual controversy.”  An actual controversy is what is required by federal law before a law suit can be filed.  In this circumstance, the suit that could be filed by the alleged infringing party is a Declaratory Judgment action (“DJ action”), which requires the court to determine whether the allegedly infringing party is actually infringing the asserted patent.  As interpreted by the courts, cease and desist letters may create an actual controversy if it creates a reasonable belief of litigation based on “the totality of the circumstances,” as the Federal Circuit said in Hewlett-Packard Co. v. Acceleron LLC.  If that sounds vague to you, rest assured, you are not alone.  Patent attorneys nation wide struggle with what language to use in a letter to avoid giving rise to an actual controversy.

One might ask what is so bad about creating an actual controversy.  There are two ways it is unfavorable, each presenting a disadvantage depending upon your own enforcement strategy.  If you seek to avoid litigation, and the allegedly infringing party is not so adverse or actually is in favor of litigation, you have provided them with the means to initiate litigation against your own wishes.  If you are willing to litigate, you have given them the ability to file suit in their chosen forum.  Instead of filing in your home court, they may file in theirs, or in another district that they believe provides them with a strategic advantage.  In either case, a cease and desist letter that creates an actual controversy wrests control of the process from your hands, which nobody likes.

The crucial task becomes walking the fine line between providing actual notice without creating an actual controversy.  Courts have explicitly said that such a feat can be accomplished, but have provided little guidance on how to actually go about doing so.  However, certain principles have been construed based upon cases determining whether certain letters provide actual notice and whether certain letters create an actual controversy.

As noted above, tone is key.  If the tone of the letter conveys to the recipient that the patentee is willing to negotiate a license, that goes a long way in heading off a DJ action.  Establishing the correct tone requires the use of many vagaries, such as their product “may infringe” as opposed to “infringes.”  Additionally, the letter must not put the recipient’s back against a wall; they must be given time to investigate both the patent and their own product.  Therefore, establishing an appropriate timeline to initiate licensing negotiations is beneficial.  Providing a claim chart may further demonstrate the seriousness with which you believe they are infringing, as well as showing your commitment to addressing the perceived infringement.

While all of the above suggestions on drafting a cease and desist letter may facilitate avoiding creating an actual controversy, certain facts about the parties may make the task more difficult.  More particularly, if the patentee’s sole source of revenue is the licensing of patents, and the allegedly infringing party is aware of this, then the belief of impending litigation may be more substantial and reasonable.  Similarly, if a patentee has ongoing litigation with other parties related to the same patent, that too may create an actual controversy.  The bottom line is that based on the absence of a bright-line rule from the courts, use your best judgment when considering you, the allegedly infringing party, and the tone created in your letter to avoid undesired outcomes while still moving forward with enforcing your patent.

Next week’s post will deal with a more aggressive tactic; filing suit.

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Congratulations!  Your claims have been allowed, you’ve paid your issue fee, and you’ve received the seal and red ribbon! It’s been years in coming, and now you can kick back and relax, both your mind and your legal budget.  Right?  Maybe not.  The decision of how to utilize a single patent or an entire portfolio of intellectual assets can dictate vastly different steps to be taken by you, your company, and your legal counsel, not to mention potential infringers.  This post is intended to be the first in a series for a newly minted patentee, giving them an overview of how they might choose to proceed with enforcement of their patent, identifying potential pitfalls, and describing alternative strategies to allow the patentee to make a more informed decision.

There are many companies that employ a defensive posture to their patent portfolio.  This is a strategy most commonly adopted by corporations offering multiple products, often that are very different in their makeup and function.  However, to many, this represents an underutilization of the value offered by patents.  Indeed, patents grant you a “negative” right – the right to prevent others from making, using, or importing the invention described by your patent.  So, if you’re going to  enforce your patent, what is the best way to go about it?

A first, very common action is to send a “Cease and Desist” letter.  A Cease and Desist letter, or “C&D,” notifies the recipient that you believe they are engaged in an activity or are making a product the includes all the elements of your patent.  Sending a C&D is a very effective way to accomplish a number of things.  First, it makes the recipient aware of your patent.  This is a requirement for some remedies in a patent suit that will be discussed in a later post.  Second, it presents you with the opportunity to initiate licensing negotiations with the recipient.  Whether you want a license or not is a strategic decision that must be made before sending the C&D, although other alternatives will be discussed if a license is not in your plan.

It is important to be aware of the risks involved in sending a C&D.  Most importantly, it does notify the recipient about your patent, at which point they may decide to design around your patent, thus potentially ceasing their allegedly infringing activity.  Were they not aware of the patent, they may have continued with the activity, increasing their exposure and, potentially, their liability.  Secondly, depending on the wording used in the C&D, the recipient may have cause to seek a Declaratory Judgment, which is essentially asking a court to decide whether the patent(s) included in the C&D are valid.  There are a number of strategic implications resulting from this that will be discussed in a later post in this series.

An alternative to sending a C&D is filing suit in Federal Court.  The only remedies for patent infringement are in the federal court system.  Filing suit conveys a very strong message, that you seriously believe the target of the suit infringes your patent, and that you are willing to litigate the matter.  However, such a strong move can have negative consequences.  Someone who has been served with a lawsuit might feel threatened to the point that they become less willing to negotiate a license.  Moreover, a significant risk of any patent suit is the risk of having your patent invalidated by the court.  Indeed, much as with choosing a C&D, there are many strategic ramifications in filing a suit as your opening salvo.

A third option is to file suit, but not serve the defendant with the suit.  In many jurisdictions, the plaintiff may wait up to thirty days before serving their complaint on the defendant.  This tactic offers a middle ground between the two options described above.  First, it is a rather significant show of strength and commitment of the plaintiff’s willingness to enforce their patent rights.  Second, it might not provoke as strong a reaction on the part of the defendant, as the suit is not active until the defendant has been served.  Moreover, this tactic also imposes a rather firm time frame on any settlement negotiations.

Each of the above strategies offers a number of strategic advantages and disadvantages that will be discussed in coming posts.  Until then, consider your own preference for adversity, what your desired outcomes are, and what reputation you want to make for yourself when deciding on a course of enforcement.


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MONDAY, JULY 28, 2014

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