Introduction - Constitution

Introduction - Constitution

A. Trademarks

·  Art I, §8, Cl.3 - Grants power to congress to regulate power among the several states

·  TMs indicate source of goods; distinguish goods from other goods

B. Patent rights and Copyrights

·  Art I, §8, Cl. 8 - “To promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their Writings and Discoveries”

·  Copyright protects original works of authorship; protects form of expression and not necessarily subject matter

·  Patents grant a property right to an inventor by USPTO; include excluding others from using/selling the invention – government sanctioned monopoly

Trademarks

Big Picture

·  Protection of brand names and good will from improper usurpation by competitors or others

Three purposes to trademark law

·  1. Protect the goodwill and reputation of sellers

·  2. Prevent consumer confusion/deception about who produced the goods or services they have purchased AND

·  3. Promoting competition in the market

·  BUT prevent monopoly on names of products that are generic

A. Validity

·  TM law focuses on deceptive marketing; so even though a ∆ may be barred from using a name, ∆will not be barred from truthfully marketing the product under a different name

·  TMs are protected when there is inherent or acquired distinctiveness

1. Generic Terms – Term identifies the product itself, rather than serving as a brand name

·  R: Term cannot qualify as a TM because it is associated in the consuming public’s mind with a product or service itself. Ex: Use of cola as brand name

·  IF TM law allowed one producer to usurp these terms as brand names, it would place competitors at a considerable disadvantage

·  GR: A term will be considered generic IF the principal significance of word is an indication of the nature/class of an article, rather than indication of its origin

·  A TM may fall into the public domain and the word will come to be understood as a name for the product rather than a brand if they are unable to retain the significance of their names (source/origin)

o  N: Court could use survey evidence to conclude that the primary significance of the word was as a product rather than a brand name

2. Spectrum of Distinctiveness

·  Generic - principal significance of the word must be its indication of the nature or class of an article, rather than an indication of its origin

·  Descriptive – describe some characteristic of the product/service and are protectable only upon a showing of secondary meaning

·  Suggestive – mark has some association with the underlying product/service but requires some imagination to see connection

·  Arbitrary – actual words, but have no association with the underlying product or service being marketed

·  Fanciful – made up word, words/marks created to serve as TMs

·  R: A term that is in one category for a particular product may be in quite a different one for another

3. Descriptive Marks and Secondary Meaning

·  R: Descriptive words only serve as TM upon a showing of secondary meaning

o  Includes geographic terms and surnamess

·  Secondary meaning is established when a mark has come through use to denote an association in the mind of the consumer between the trade dress (or name) of a product and a particular purpose

·  Π must show that in the minds of the public, the primary significance of a product feature or term is to identify the source of the product rather than the product itself

o  Factors to Consider

§  Amount and manner of advertising

§  Volume of sales

§  Length and manner of use

§  Direct consumer testimony

§  Consumer Surveys

·  S: TM has secondary meaning if the mark’s primary significance is to serve as an indication of the source of the goods

4. Surnames

·  Considered to be a descriptive term and is protected as a TM only upon a showing of secondary meaning

·  GR: Sacred right theory that every man may employ his own name in his business is not unlimited

o  Enjoinment from use of a family name is proper when such use trends or threatens to produce confusion in the public mind

5. Colors, Sounds, Scents, and Other Marks

·  Color is a descriptive mark and must be shown to have secondary meaning

·  Color must NOT serve any functional purpose, this includes aesthetic functionality

6. Trade Dress

·  Def: Trade dress – is the total image of the business; may include shape and general appearance of the exterior of a restaurant

·  R: Protection assessed under the spectrum of distinctiveness

o  No secondary meaning required unless descriptive

·  R: Only nonfunctional trade dress features are eligible for TM protection

·  N: Product packaging cases – no plausible claim that functionality doctrine applies, largely an extension of ordinary TMs

7. The Functionality Doctrine

·  Functionality Doctrine forbids the use of a product’s feature as a TM where doing so will put a competitor at a significant disadvantage b/c the feature is essential to the use or purpose of the article or affects its cost or quality

o  Ex: TMing the shape of a light bulb

·  An aspect of a product or trade dress is legally functional and thus unprotectible IF it is one of a limited number of efficient options available to competitors and free competition would be unduly hindered by according the design TM protection

·  R: πis required to prove non-functionality

·  Aesthetic functionality - Functionality can include aesthetics such as blue and white color in water bottle, but since a color is involved secondary meaning would have to be shown

o  T: Whether recognition of TM rights would significantly hinder competition

·  OVERLAP W/PATENT LAW

o  Test question: Functional feature that has attained secondary meaning through the success of the product perhaps thru patent monopoly; firm is not entitled to perpetual TM, once patent expires the competitors are free to imitate

o  N: Utility patent is strong evidence of functionality

o  R: Where the expired patent claimed the features in question, one who seeks to burden trade dress protection must carry the burden

8. Trade Dresss & Product Configurations – actual appearance of the product itself

(a). Trade Dress

·  Packaging of the product (Crayola chalk box); can be inherently distinctive and no secondary meaning need be shown – Two Tacos

(b). Product Configuration/designs

·  Design of the product itself; not the wrapping that it comes in

·  If you are dealing with a product itself, claiming that the design is a TM is okay but you must show that the design has secondary meaning (hard to do,ex: Goldfish) - Walmart

·  S: Product design cannot be inherently distinctive and could be protected only upon a showing of secondary meaning

9 Marks Precluded from Registration

·  TM will be refused IF they are scandalous or immoral or offensive

o  Whether applicant’s mark is likely to offend must not be judged in isolation but rather in the entire context of the mark’s use

o  They may be cancelled when they have become offensive

·  TM is prohibited if a mark is deceptive – three part test

o  1. Is the term misdescriptive of the character, quality, function, composition or use of the goods

o  2. If so, are prospective purchasers likely to believe that the misdescription actually describes the goods

o  3. If so, is the misdescription likely to affect the decision to purchase

o  BUT, misdesriptiveness can be negated by its meaning in the context of the whole mark inasmuch as the combination is seen together and makes a unitary impression

10. Service Marks - Other than distinction between goods and service, treated the same

·  Service mark means a mark used in the sale of services to identify and distinguish the services of one person, including a unique service, from the services of others and to indicate the source of services, even if that source is unknown

·  Owners required to make bona fide use of a mark to sell a service before being eligible for additional service mark registration

·  GR: Rendering of a service that is expected or routine in connection with the sale of one’s own goods is NOT a registerable service whether denominated by the same or a different name from the TM for its product

o  Public does not perceive such an activity as a service to the public but as mere sales activity by and for the benefit of the offerer of the goods

11. Certification and Collective Marks

·  Def: Certification mark is a mark used with the products or services of one other than the owner of the mark to certify origin of quality, accuracy, or other characteristic of goods or service

o  N: Certification mark registration may be cancelled if the mark is not used exclusively as a certification mark

o  R: Cancellation if the certification mark registrant does not control or is not able to legitimately to exercise control over, the use of the mark

o  S: Control requirement means the mark owner must take reasonable steps, under all circumstances of the case, to prevent the public from being misled

·  Def: Collective Mark - Marks used by members of a cooperative, association, or other collective group to show membership in the group or association

·  Difference – collective is where sellers are a member of an organization with standards of membership; while if there is no membership but products are certified then its certification

B. Ownership

1. Common Law Trademark Use

·  TM rights are traditionally developed through use in commerce

·  Registered corporate name but no use in commerce will not support a TM; Especially when π does not possess goodwill nor a reasonable prospect to acquire it – Galt House

o  N: Right answer is to register after establishing corporate identity, register TM federally and corporate name with state

·  I: When neither party has registered a mark, but both are using it

·  R: First to use in trade; use in trade must be bona fide; accrues when goods bearing the mark are place on the market

o  Not at conception of the mark, not advertising alone

o  Single use may be enough, internal use is no good

o  N: Attaching 2˚ label to old line of goods is bad faith

2. Intent to Use Trademark Application

·  ITU provisions of the Lanham Act essentially enable a party to obtain temporary preemptive rights to a mark that it intends in GF to use in commerce in the reasonably foreseeable future

(a). Process

·  IF, upon examination, the mark appears registrable, the PTO publishes it for opposition

·  If no opposer is successful, the PTO issues a notice of allowance

·  The applicant then has six months in which to file a statement that verifies that: the mark is in use in commerce, the date of first use in commerce, the goods and services in connection with the mark are used in commerce, and the manner in which the mark is being used

·  The statement of use is then subject to another examination, in which the PTO consider how the mark is used AND

·  IF it is still satisfied that, as used, the mark is registrable, issues a certificate of registration

(b). Rules

·  R: Registration precluded when mark used in connection with the goods of applicant are merely descriptive or deceptive

·  I: How to evaluate a TM for its descriptiveness/secondary meaning before it has actually been used in the marketplace

o  R: Evaluation of distinctiveness should occur after the TM applicant has had an opportunity to introduce the mark in commerce

3. Statutory Trademark Rights – Constructive Notice & Incontestability

(a). Advantage of having a federally registered TM

·  Incontestability - User who has successfully registered and continued using a federal service mark has an incontestable right to use the mark throughout the US in connection with the good or services with which it has been used

·  Constructive Notice - Registration puts would be users of the mark (or a confusingly similar mark) on constructive notice of the mark

(b). Limited Area exception

·  TM protection for remote users, junior users have the right to continued use of an otherwise infringing mark in a remote geographical area IF that use was established prior to the other party’s federal registration

·  R: Junior user must have used the mark continuously in that location and initially in GF w/o notice of an infringing mark

·  Proof: Junior user must show that

o  It adopted the mark before Senior user’s federal registration

o  The extent of the trade area in which Junior user used the mark prior to Senior user’s registration

o  Junior user had continuously used the mark in the pre-registration trade area

(c). Defenses to the Incontestability right

·  Registration or incontestable right obtained fraudulently

·  Abandonment

·  Used w/permission of registrant so as to misrepresent the source of goods in connection with which the mark is used