Tuesday, June 29, 2010

9th Circuit (Kozinski) opinion on dilution of non-coined marks

VISA claimed that "eVisa" for "multilingual education and information" services on the Internet diluted its famous mark by blurring. In Visa Int'l Serv. Ass'n v. JSL Corp., No. 08-15206 (9th Cir. June 28, 2010), the 9th Circuit agreed.

Judge Kozinski's opinion focused on issues that can arise when the plaintiff's mark is a real word in the dictionary (e.g., "VISA," as opposed to a coined term like XEROX). Two ways this circumstance can affect a dilution-by-blurring claim are whether the plaintiff's mark is distinctive enough to be protected under the dilution statute and whether the defendant can claim a fair descriptive use.

The court held that even a word appearing in the dictionary can be distinctive enough to qualify for dilution protection (under 15 USC § 1125(c)(1)), so long as the plaintiff isn't using it descriptively. Judge Kozinski mentioned TIDE and CAMEL, among other examples sprinkled throughout the court's opinion.

The court also rejected what appeared to be the defendant's "fair descriptive use" defense (15 USC § 1125(c)(3)(A)), saying using eVisa for multilingual education did not evoke the dictionary definition of "visa."

Friday, June 25, 2010

Fed. Cir. Overturns Yet Another E.D. Tex. “No Transfer” Order

The Federal Circuit yesterday rejected a plaintiff’s attorney’s attempt to “game the system” by arranging to have its client open up what appeared to be a sham office in the E.D. Tex. before filing a patent suit there against an Indiana company.

In In re Zimmer Holdings, Inc., No. 2010-M938 (Fed. Cir. June 24, 2010), the evidence showed that the plaintiff's Longview, Texas, office was shared with another of plaintiff’s counsel’s clients. The plaintiff was not registered to do business in Texas, had no employees in Texas, and actually has deeper ties to Michigan, where it conducts its R&D, where its two officers reside, and where its patent prosecution is done. But the district court denied a section 1404(a) transfer.

The Federal Circuit granted the defendant's petition for mandamus. It chastised the district court for admittedly refusing to “scrutinize litigants’ business decisions to determine whether opening an office in a particular location has a legitimate business purpose or is merely a tactic to manipulate venue.” Citing Hertz Corp. v. Friend, 130 S. Ct. 1181, 1195 (2010), the Federal Circuit urged district courts to do just that. Calling the Longview office "a legal fiction" (slip op. at 8), the court held that manipulation is precisely what transpired in this case: “This is a classic case where the plaintiff is attempting to game the system by artificially seeking to establish venue by sharing office space with another of the trial counsel’s clients.” (Id. at 6.)

Thursday, June 03, 2010

5th Circuit lays out analytical framework for assessing distinctiveness of registered design mark

The Fifth Circuit yesterday issued an opinion discussing how to analyze the distinctiveness of a registered design mark. In Amazing Spaces, Inc. v. Metro Mini Storage, No. 09-20702 (5th Cir. June 2, 2010), the court first held that the presumption of validity flowing from registration was not itself enough to stave off summary judgment of nondistinctiveness (at least in this case).

Moving on to an assessment of inherent distinctiveness, the court held that this registered design mark:

could not be analyzed under the seminal distinctiveness (generic, descriptive, suggestive, arbitrary/fanciful) test set forth in Abercrombie & Fitch Co. v. Hunting World, Inc., 537 F.2d 4 (2d Cir. 1976) (Friendly, J.) (generic, descriptive, suggestive, arbitrary/fanciful) because it was a "futile endeavor" to try to apply any of those labels to the mark. (The court resisted saying that Abercrombie could never be applied to a non-word mark, however.)

Instead, the court applied the distinctiveness test from Seabrook Foods, Inc. v. Bar-Well Foods Ltd., 568 F.2d 1342 (CCPA 1978), which is geared more toward design marks. The Seabrook test looks at whether the design is a common shape or form of ornamentation (as opposed to being unusual in its field), or is capable of being perceived as an indicator of source apart from any words it is used with. Applying Seabrook, the court held that so many others use designs similar to this one that it was not inherently distinctive.

The mark owner tried to establish secondary meaning by offering evidence of long usage, substantial sales revenue, and substantial advertising expenditures. But the 5th Circuit affirmed summary judgment of no secondary meaning because the evidence showed that the mark owner primarily used the mark as a form of ornamentation, along with word marks that were more clearly the main product identifiers. In other words, these other facts severed the inferential link the mark owner tried to make between this circumstantial evidence and the conclusion that the star design itself thereby acquired secondary meaning.