How to Internationalize Your Intellectual Property and Brand the Right Way

How to Internationalize Your Intellectual Property and Brand the Right Way

By Craig Neugeboren and Emily Bryson


Internationalizing your brand or business in general is exactly what it sounds like — going global. Today’s market almost insists on internationalizing your exciting product or brand. But many businesses don’t want to put the money forward to do it, or they are forced into critical decisions that are irrevocable.  

There are two sides to this that we will look at here. There is a side that involves protecting intellectual property. That is our job at Neugeboren O'Dowd and involves working with a client on the decision-making process for trademarks and patents. 

And there is the side that looks at the business side of things, from marketing to human resources, and more. This is Emily Bryson's specialty. A lot goes into making sure a brand will succeed overseas. She works for CCW Business Solutions (Crowe UK) and educates companies that are looking to expand their business footprint beyond the United States. She offers an excellent business sense of the process and advises companies on areas where there are both tips and traps in the corporate expansion dynamic.

Craig Neugeboren on Internationalizing Trademarks

Our process here is a lot different than Emily's. We come from the position of protecting intellectual property. It's a little more self-defined due to strict legal deadlines and timelines. It's a very exacting process and methodology when it comes to protecting United States intellectual property overseas in the most cost-effective way possible.  More often than not, our deadlines and due dates are set in stone, especially on the patent side of things.

That process timeline is often the most important part of the internationalization of patents and trademarks because not adhering to those deadlines could mean the client is no longer allowed to apply again. Our job here is to provide a very clear roadmap in terms of both substance and administration of that process.

In the trademark world, you have roughly six months after an initial filing date to act. In the patent world, it's twelve months after the filing date. 

The Patent Side

Here, it's good and it's bad because having a strict timeline sometimes makes the decision making easier for the client. But on the other hand, at least on the patent side of things, the deadlines are often fatal if you miss them. If a client wants to protect their intellectual property overseas, they have to make the decision a year after their United States (or first application) case is filed. If they don't, they've permanently lost the opportunity to internationalize that property.

The other downside is in costs. From our perspective, the costs are immediate. This makes the decision making even more uneasy. First, you have the deadline to worry about, then you have the upfront costs associated with it. If after the year you decide you aren't going to pursue international patent protection, you're forever banned from trying to do so on that project. It's a very expensive decision for the client either way.

The Trademark Side

The trademark side is a little more flexible and forgivable. You still have deadlines and a timeline you have to do things by in order to retain your priority in the U.S. application filings, but it's not fatal if you wait until after that priority deadline to take your cases overseas.

Later, you can still go on and file for international trademark protection if you change your mind.

For that leeway, it does get a little more expensive if you wait.

If a client isn't sure if they are going to internationalize their trademarks, I would say, just pass for now, or file something very basic, like a Madrid Protocol application that designates one of the less expensive countries.

If the product does well in a year from now, we might revisit the conversation.

Taking Intellectual Property Global

We know how difficult these decisions are. So we may hedge a little bit for our client and do some of the bare minimum filings to give them a chance to kick the can of foreign applications down the road.

When it's a smaller company, the legal strategy is different. If they don't have an acquisition plan or are working on liquidation deals, we want them to be able to preserve their internationalization rights.

That's something we do a lot of, and we'll work alongside an attorney in the country in question to get their help. They will even look at it before we file to ensure it's compliant with local regulations.

That's something that a lot of attorneys in the United States just don't do. 

We encourage upfront conversations about going global, and it's our job to give companies the foresight they need to make the decisions they want to make, as comfortably as possible.

Smaller companies have just as many rights to internationalize as the big ones. But if they are just starting, and we're asking them about their commercialization strategy for Japan, they are going to throw up their hands and feel overwhelmed.

In the end, though, a client is not going to focus on international intellectual property protection at all if the commercialization path isn't clear. We work the legal end of things, and folks like Emily Bryson work the market side of things.

Emily Bryson on Testing the Market

As Craig said, the commercialization path with a foreign application is entirely up to the company. What I do is work with companies to educate them on the options that are available to expand their brand internationally. Today, it's easier than ever to test the market, and there are a number of ways that they can do so.

The first thing a company needs to do is understand the market they are expanding their business into. Every country is different.

What might happen with their product in China may not happen with their product in the U.K. or Brazil. Often executives are under the impression that every country operates just like the United States, and that's just not the case.  

Related: Update on China's Amended Trade Laws

The perfect time to have an initial conversation is before a specific country/market is identified. However often this process can be more of a fire drill with an immediate need to enter as soon as possible.  

How do you enter? What type of corporate structure do you need to have in place? Do you even need a corporate structure to test the market? The good news is that there are several ways you can do this! And in some instances very cost-effectively!

Companies need to understand their risk; regulatory and legal compliance. Expanding smoothly into another country without violating any laws or rules needs to be top of mind. It is also very important to understand language and cultural differences, this can define the difference between a successful business and an unsuccessful business.

Globalization Timelines

Establishing globalization timelines helps the client tremendously. Establishing a 6, 12, and/or 18-month plan is a great place to begin helping the client feel better about their commercialization path.

They want to do it though. The biggest downside from my end of internationalizing the brand is similar to Craig's. Companies should always assess their capital prior to entering any new markets.

Read more: Market Intelligence and Brand Management

Staying Competitive in a Global Market

A key part of business is staying competitive, and it's at the top of the list of things we both talk about with our clients. We help them understand what their competition is doing, and what other companies in their vertical are doing. We do this even at the early stages.

We both want to help them make the highest dollar sense of return for what they are doing. When they know what their peers have successfully done, they can take their brand and intellectual property up a notch.

We both also offer them insight into the tax advantages of internationalization as well. 

There's a lot that goes into internationalizing a brand. Emily and Craig come from two different sides of the issue, while also complementing each other very well. Let us know if it's a good time for your company to go global. We want you to succeed.

From Design Engineer to Patent Attorney – Meet Craig Neugeboren

From Design Engineer to Patent Attorney – Meet Craig Neugeboren

Design engineering is by no means a boring field. But for me, being stuck in a sea of Dilbert-occupied cubicles quickly pushed me to pursue a career in patent law.

Don’t get me wrong, I was lucky to have such a great job right out of college, but when I regularly saw so many “seasoned” engineers snoring in their office next to me and clearly wearing the same tie for 30 years, all I could think was, I don't want to be that Slimline Stapler guy. 

It wasn't always a terrible job. I worked for a good company, had a lot of close friends, and eventually landed on good projects with unique challenges. I also met my wife Heather there. But being just a little cog in this huge wheel was so boring to me. It wasn't fulfilling and the path forward was murky at best. I didn't know what I wanted, but I knew it wasn’t that. 

From a Cubicle to Law School

It didn't take long behind a cubicle wall to realize I couldn’t do it forever. Another engineer that I had become friendly with started talking about law school. He was several years in himself and mentored me a little bit on that path. 

I took the LSATs and got into Rutgers University in New Jersey, starting just over a year after I had finished my undergraduate degree. I was still working full-time, so being able to go to school in-state really helped. The law school dream was within reach.

I would work all day and then go to school at night with other “looking for a second career” students.  At work, I eventually wound up managing some big redevelopment projects, travelling regularly to the towns where there was a need, and managing the environmental remediation and overall construction. I was 23 and making presentations to town planners, historical boards, and city councils in addition to overseeing construction crews, and tweaking the construction designs as needed. In retrospect that type of role was more aligned with the advocacy I practice as a lawyer now than it was with being an engineer.

When an engineering job in California came up, I decided to take it. They offered my wife (also an engineer) a position, too. And so I eventually finished my law degree in California.

The Transition

When it was all said and done, I attended four different law schools to get my degree, which is formally from Rutgers University.  I have law school transcripts cobbled together from Rutgers, The University of the Pacific, Santa Clara University, and The University of San Francisco. But I finished law school in Silicon Valley in 1997, and with an engineering degree behind it, the job market was just wonderful.

I began to work with an intellectual property law firm in California, and that has been my practice ever since. This was the late nineties, at the beginning of the dot-com craziness. There was plenty of work from patent and trademark prosecution to the related litigation and transactional work surrounding those disciplines; everything that we do here today.

In 1998, the competition between companies for lawyers in that field was just nuts. I got two or three raises before I even began working for my firm. My original offer letter was in late '97, and by the time I actually started working in April 1998 I had received several raises.

Those were the moves in my life that started the career I’m enjoying now. In that first firm I was able to participate in some big trials in addition to the patent prosecution work, giving me the skill set that I needed to establish myself as a patent attorney.

Living in California began to get a little more hectic than we had imagined. Heather and I went from spending every weekend in the mountains to becoming new parents in the heart of Silicon Valley — and all the stress and busyness that comes with it. To bring a calmer and more predictable sense to our lives, I quit my job and moved my family from San Jose to Boulder, Colorado. I didn’t even have a job lined up when I resigned, but the market was still so good, I wasn’t worried.

Avoiding Big Law Burnout

I immediately took a job with a big national law firm. The hours were long, there was a lot of work, and I was traveling a lot for these giant, awesome cases.

At its core, the work was great. I worked with some amazing people and got a lot of really unique opportunities. I had a really good run there, but it took its toll as well.

I suffered a unique case of “Big-Law Burnout.” In a nutshell, what started off as a cut on my elbow turned into a near-sepsis scare and some hospital time where I very nearly died. During all of that, I was doing deposition designations from a hospital bed, and hooking IV antibiotic bags up on the wall at work once I left the hospital.

A perfectly normal life, right? No.

That was the beginning of the end for me in big law.

I can't say anything bad about the firm or the job, other than there was just too much work. I loved the people, they treated me very well, and they still support me and our firm today through referrals and the like. Working there gave me the skills to develop my own practice and achieve a more balanced approach to what I do now.

How a Dream Became a Firm

During a short stint in-house, I began reaching out to my clients to see what they thought about the idea of me opening my own practice, and they were ready to start working right away. By the end of the first month after hanging that shingle, I was already profitable. And it wasn't long before I was making more than I was at my last firm, with less work and of course, more control to make it fit my own lifestyle.

We've been growing steadily over the years. I met Sean O'Dowd at the previous law firm and he came over shortly after I opened up. A year later we had formally partnered up and we've enjoyed slow and steady growth over the years.

Building relationships is the most exciting part of my job. Now with a larger firm, and a stable slate of work, when a client asks me for something I can't do, or I know someone else here can do better, I can refer it to someone within our firm family that I know will treat them well.

My favorite type of client is one that calls to ask me a 90-second question and we wind up on the phone for 30 or 40 minutes chatting about everything else in life. It's that relationship that makes the engagement so much better.

In the end, the dream has become a reality; a firm that we are all proud to be a part of. Engineering is still exciting but I like taking the broad brush approach and becoming knowledgeable across a wide range of technologies and industries and knowing how to steer a company or client in the right direction.

Keep Reading: From Network Engineer to Intellectual Property Attorney: Meet Shane Percival


Neil Young versus the Trump Campaign — Maybe not a Heart of Gold

It's an old problem being made new again. Neil Young is suing the Trump campaign for using his song at a rally and is calling it copyright infringement.

Political parties on both sides of the aisle have been doing this for years, and it's rarely brought into the legal spotlight. But people jumped on this one. Go figure...

The average copyright case works on the basic premise, "I created something, I have a copyright on it. You need to ask for permission before you copy it or use it." It’s actually a fairly easy legal issue for the layperson to understand and most clear-cut factual patterns that fit that legal framework don’t see the light of day because there isn’t a genuine factual dispute to litigate.

But this one is a little bit different, because of how the song was used, and how the artist feels about his work being used. In part, the suit reads,

"This complaint is not intended to disrespect the rights and opinions of American citizens, who are free to support the candidate of their choosing. However, the Plaintiff in good conscience cannot allow his music to be used as a theme song for a divisive, un-American campaign of ignorance and hate." 

At its core, there may be some simple copyright infringement going on. But there is more to this story and some unique aspects of copyright law and licensing at issue.

Related: Stealing or Buying a Stairway to Heaven? 

Basics of Copyright Infringement

The "permission to use" part is at the core of most copyright cases. If the Trump campaign had their ducks in a row and received permission, the claim of copyright infringement would instantly fail.  

The default is that permission is needed for someone to use or perform the music of someone else (i.e. the author). No one is exempt regardless of their intentions or purpose. For example, churches and cover bands are no different. When a worship team or cover band plays someone else’s music, that is copyright infringement if they haven't purchased some form of license to the music. So you might notice sometimes in the lyrics on the screen, or within written words, a CCLI license number. That is for the Christian Copyright Licensing International organization that licenses that music. Performance venues usually have these types of blanket licenses in place as well to cover the performance of other’s music in their venues. Or the band itself may own a license.

Organizations are allowed to purchase these blanket performance rights to one of these clearinghouses in the music world, as long as the artist gives them (the licensing organization) permission to use that music. The organization then pays an annual fee, so they have blanket rights to use all the songs under that agreement.

While the facts are fuzzy from the Trump campaign, it is likely that they did not obtain such a license. So, Neil Young can sue for straight-up copyright infringement. 

Types of Copyright Infringement

There are two different types of clearinghouse-type licenses out there for commercial use that a political campaign might utilize. 

  • Broadcast rights are for background music in a campaign commercial that might get broadcast on television over and over. 
  • A performance license (what this case is referencing) is for music that’s played in a live setting, typically not recorded or repeated.

Understandably, the first one is harder to get and much more expensive.

Is the Trump Campaign on the Hook?

It should be an open and shut case. If the campaign purchased the performance license, then they have the right to use it and the case should just go away. My guess is that they didn't and now they're just throwing stuff together really quick because it might take weeks or months to get that license. 

There are some really interesting nuances in the copyright laws, but also in how the copyright laws affect artists in these situations. 

This case has moved a little bit since it was first filed in August. A civil summons was issued in the U.S. District Court for the Southern District of New York, with Senior U.S. District Court Judge Naomi Reice Buchwald, a Clinton appointee, receiving the assignment. It was subsequently designated to Magistrate Judge Ona T. Wang.

The Trump campaign was issued an electronic summons as well — so the case is proceeding along normal civil court timelines. An update on the case beyond that has not been released.

Related: Katy Perry Escapes Dark Horse Copyright Verdict

The Bottom Line

If the Trump campaign is found to not have a license to this song, traditional notions of remedies and copyright law come into play. That means Neil Young may be entitled to up to $150,000 per “copy” if the infringement was found to be willful. It's interesting because it was at a rally, so you would presume it's just a single instance of performing that song. But, that rally was recorded and now it's now on YouTube with more than 500,000 views/downloads/copies... 

Each click on YouTube may be considered a separate copy under copyright law, particularly if the campaign allows people to download the video. So if the stars align with Neil Young, and the Trump campaign did actually commit copyright infringement, the payout could be huge.

To apply the maximum statutory damages allowed (up to $150,000 per copy) times 522,909 views, Neil Young is looking at $65 billion. 

It obviously wouldn't happen that way when it came time to actual damages. But this is an interesting case to see how far this can go. At least the math is interesting. But math has never really been Trump’s strong suit.

Is this case the first of its kind? Not really. Both political parties have been doing this for years. But, it does illustrate just how expensive copyright infringement can get. And how simple it can be to avoid liability.

Non-Disclosure Agreement

An NDA is Not a Condom

Public service announcement reminder from back in your school days — Condoms are only 97% effective. Public service announcement from your lawyer — NDAs, or non-disclosure agreements, are even less so when you think they also act as a prophylactic device.

While an NDA isn’t a prophylactic, that isn’t to say they aren’t helpful in putting preventive measures in place since they can be an effective legal remedy to prevent the misappropriation of trade secrets. After that, their effectiveness wanes. Once the confidential information protected by an NDA is misappropriated or otherwise publicly disclosed (intentionally or accidentally), the toothpaste is out of the tube and you can't put it back in.

What we tell our clients is that how you act after an NDA is signed is more important than the NDA itself. In other words, be careful about keeping that toothpaste in the tube.

What is a Non-Disclosure Agreement?

Nondisclosure agreements are very basic documents. It's a simple form that is ubiquitous in most business environments. People throw them around easily. Effective versions of them can even be downloaded from the internet.

Generally, most NDAs are self-explanatory and don’t present a lot of contentious issues between the parties. They are typically used in a situation where two parties want to share information about a company's products, technology, or confidential information in furtherance of some form of collaboration, deal, or another business arrangement. 

NDAs are a common way to obligate parties to keep their respective trade secrets, well, secret. 

Where we see problems is that most people — when they have an NDA in place — feel like they can talk about anything and share everything under the sun. In effect, they start blabbing too much and about things that aren’t necessary to get the deal done.

An NDA is just a piece of paper, like any other contract. It's not a prophylactic device. It’s just a contract that gives you the ability to sue someone for misappropriation of your own trade secrets.

So, if you (or the other party) inappropriately discloses confidential information to someone, and a nondisclosure agreement is in place, the irreparable harm of your trade secrets being in the public domain is difficult — if not impossible — to recapture.

Related: Is a Trade Secret Right for You?

You Can't Unring the Bell – The Problem With Enforcing NDAs

At that point, the "teller" could be sued for trade secret misappropriation, or more easily, breach of contract. But, the bell cannot be unrung. You can't put the toothpaste back in the tube. The cat is out of the bag. Choose your cliche but the damage is done and the confidential information may be out in the public domain with no way to effectively make it secret again.

The remedy in these situations is to sue and ask for immediate injunctive relief to stop the faucet from dripping. But there's water already in the sink, right? This is what is referred to as irrevocable harm so often mentioned in an NDA and other contracts.  

Even with immediate court intervention, you might never be able to cure the breach or find a remedy that would fix what just happened. The agreement that was to prevent that from happening is just a piece of paper and as the title of this article suggests isn’t capable of preventing this type of “leak.”  Yeah, that was gross but I couldn’t resist.

There's no guarantee the person will actually respect the obligations in that agreement. So what I tell my clients is just that, the NDA is not a prophylactic. My advice to them is always the same.

Do not tell third parties anything that is not absolutely necessary for them to know. Focus on the purpose of your discussion, rather than information that is outside the scope of the meeting or other information exchange.

Implementing NDAs Properly

A lot of times the people negotiating the NDA are higher-ups. It's the engineers and the technologists who are actually the ones in a conference room collaborating with a third party.

Oftentimes the type of instruction about the implementation of the NDA is more important than the NDA itself. How you act when you're in a situation where confidential information can be shared is critical and those instructions need to be given to the ones on the ground. 

Don't tell them anything you don't need to tell them. It's that simple.

That advice goes both ways. You may be the one in a situation where someone else is saying a little too much, and you want to protect yourself there too. Don't ever be afraid to just say, "Hey, what you just said is kind of beyond the scope of what I was willing to talk about today. Do we really need to have that disclosed for this conversation?”

Implementing an NDA effectively requires the responsibility of both parties, and it's all in the details.

Related: New Injunction Policy Boosts Power of Essential Patents

It's All in the Details

Most NDAs are generalized and broad in scope, but you can put details in the picture as well. The more details you have in there, like labeling the document as confidential, the stronger your agreement.

If it's electronic, it should have some sort of legend on it. It’s also important to say verbally and in writing; "What I'm about to tell you is confidential and falls under the scope of this nondisclosure agreement."

If you don't do that, or forget, follow it up. You want a good paper trail to show that you're actually treating your information as confidential. The first thing a court will look at if you want to enforce an NDA is whether you actually treated the information as confidential. If you, or your company, have loose rules about access to confidential information, a court may actually find that it isn’t confidential at all.

NDAs don’t have to be specific, most are broad and generalized. The goal is to have an engagement with a third party, exchange information, and be comfortable talking about things.

Problems with NDAs arise when you're exchanging information that you just don't need to. If it's not necessary, don't talk about it. Even if you don't know specifically what you can't talk about, most NDAs will have a broad or blanket definition of what is confidential.

Other details to consider are with larger companies that might have dozens, if not hundreds, of individual nondisclosure agreements with various people and parties. Managing that can be a problem.

So it's not just about keeping track of who you have agreements with, but also keeping track of when they expire, or what you need to do in order to terminate the agreements. Understanding which ones will automatically renew without action is also an important detail to track.

Those can come into play and bite you later if, for instance, you want to sell your company and the suitor is doing some diligence and realizes you've got a thousand NDAs out there, all of which are still in force.

That might be a problem. Bigger companies might have a contract manager role to take care of all of that, but smaller and mid-sized companies might not. Those NDAs may get lost in the shuffle.

Practice Safe Disclosure

The most important thing to remember with NDAs is they are not a prophylactic device to prevent all preventable mishaps. Practice safe disclosure. 

If you have any questions about protecting your information and non-disclosure agreements, contact us. We are here to help.

COVID and the Constitution

The First Amendment to the Constitution does not give you the right to yell “fire” in a crowded theater. That is unless the theater is actually on fire. That’s not my quote. I heard it or read it recently on a newscast or webcast or blog post that was buried within 1000 other snippets and quotes and news of the day and I haven’t been able to track it down again.

So, my apologies (and credit) to the original author or speaker, whoever that may be. Wouldn’t it be nice if it were 50 years ago and we all got our news from the same source? If that were the case I could say “Walter Cronkite said...” But now I have no idea who said it. It just wasn’t me.

The legal case that led to that metaphor took years to develop and was based on a constitutional argument under the First Amendment guarantee of freedom of speech. Like most things under the Constitution, the freedom of speech is not absolute. If the primary purpose of your speech is likely to incite imminent lawless action, it is not protected. Most would agree with this interpretation I think. But with COVID-19 there has been rapid adoption of new laws and regulations from the municipal to the federal level that has changed our lives as a result of the pandemic. Some of these are mundane, or even fall under the heading of “why didn’t we always do things that way.” Like home delivery of beer and wine, or telemedicine, or video notary services, or extending deadlines in the patent and trademark office, or making your restaurant kitchen workers wear masks. Did I mention home delivery of beer and wine...?

But others are much more controversial and are highlighting the powers that our executives may have always had at their disposal but never had reason to use. They are certainly raising new questions in terms of testing against constitutional scrutiny. Even the CDC has emergency federal powers now that can arguably circumvent our due process rights in order to implement health safeguards. It is one of the reasons we are all so afraid right now. We thought the changes would be temporary, and it feels more and more like they are not.

One thing we do know, as we have already discussed here, is that a vaccine has been prioritized at multiple levels both nationally and globally. Once that implementation takes effect, life will slowly return to normal. Until then, however, strong emotions around the unknown prevail.

I’ve had so many interesting and challenging discussions over the last 6 months about how this new normal aligns with the Constitution. Many of them focus on how we deal with aspects of the new normal that most certainly push up against the guardrails of the Constitution? Especially when that push comes from both sides of the political and social spectrum and all have at least some basic level of legitimacy on their faces. I feel like this is the first time (at least for my generation) we have needed to think about our constitutional freedoms in a more than colloquial or academic way. It’s not that society has never had to wrestle with these types of issues before but I don’t know that it has ever happened this quickly and on so many fronts. We all want a binary result but the Constitution is hardly a binary document.  More people are becoming educated about what the Constitution says which is always a good thing.

This fear is not just superficial. One in three Americans is now suffering from mental health disorders that they may not even know they have — anxiety, depression, and more. My 98-year-old grandfather, who fought as a marine in World War II and still has 100% of his cognitive abilities is experiencing depression for possibly the first time in his life because of the enhanced isolation protocols at his assisted living facility. No common meals, no playing cards, no socialization. Wearing a mask takes on a whole new burden to someone who already has trouble hearing.

First Amendment: Speech, Assembly, and Religion

The Covid-19 pandemic has undoubtedly affected our freedom to assemble, which carries over into our freedom to speak, to worship, to travel, to work, and to recreate. Frustrations around this cross the political aisle and are being experienced at every level of government across the nation. Exercising the new laws started slowly but has resulted in new regulations that impact everyday life in profound ways. When a law impacts one person, it has the power to profoundly affect an entire family. The tertiary impacts of today’s new normal are significant and cannot be ignored.

Freedom to Assemble and Speech

Before COVID-19, almost everything we did required some form of assembly and/or speech. Our freedoms to assemble, whether that is to worship, work, protest, attend concerts, or simply recreate have all been affected by COVID.  Worshipping and otherwise gathering remotely doesn’t feel the same, and just doesn’t meet the same need that meeting people face to face does. My church has now been able to gather outside in limited numbers, and for the most part, everyone understands the risk of pushing the boundaries and puts aside what might be a legitimate complaint of unconstitutional regulation so that our community stays safe. But people still worry that there’s not an end to this new normal. 

Fifth Amendment: Liberty to Travel 

In 1958, the Supreme Court wrote in Kent v. Dulles (357 U.S. 116) that “the right to travel is a part of the liberty of which the citizen cannot be deprived without due process of law under the Fifth Amendment. Freedom of movement across frontiers in either direction and inside frontiers as well was a part of our heritage. Freedom of movement is basic in our scheme of values.”

Now, we live in a new normal where we all wrestle with stay-at-home orders, travel bans, and other restrictions on our ability to freely move about and work. Again, most people are putting aside what might be an unconstitutional infringement on our rights so that our community stays safe.

The Right to a Speedy Trial and Competent Counsel

Due process of law that is primarily captured in the sixth and tenth amendment rights are also restricted. The Sixth Amendment secures freedom to counsel and speedy trials, but the courts are in a long circle of delay right now. Access to the courts is reshaped. Being charged with a crime now could meet untold extensions.  How does being required to wear a mask affect the right to confront your accuser or cross-examine a witness at trial?  Every stage from arraignment to voir dire and jury assembly is disrupted by delays during COVID-19, and this will impact the lives and families of all of those involved.

You Say, The Price of My Love’s Not a Price That You’re Willing to Pay... 

The Constitution is one of the most brilliant documents in the world. The pandemic has resulted in a breadth of mandatory restrictions that, at least on their face, raise constitutional questions, but more importantly have elevated the discourse about how brilliant our founding fathers were in crafting this guiding document. If you haven’t done so, sit down and read it from cover to cover.

The conversations that result will be challenging for sure, but if you aren’t ready to dig in at that level — at least watch Hamilton and listen carefully to what King George wanted instead...  Da da da dat da dat da da da da ya da!

Related: Living a White Collar Quarantine?

No Smoking Gun Required – Lost Profits More Broadly Available for Trademark Infringement

Recovering a trademark owner’s lost profits due to infringement has always been difficult. Typically, the court requires some level of malice/intentionality on the side of the trademark infringer in order for the trademark owner to recover lost profits. Showing malice or intent is a challenge because you need to show the infringer's state of mind. How do you do that? Without a “smoking gun” email saying, “I know I infringed, but I don't care, and I’m going to keep on infringing,” it’s almost impossible to prove.  Only once in my legal career did I have that type of blatant admission from the other party. And yeah, we won that case... 

But that could soon change.

On April 21, 2020, the US Supreme Court ruled that the Lanham Act enables a trademark owner to recover profits from a trademark infringer without necessarily proving willfulness. This update to the interpretation of Section 43 (a) of the Lanham Act changes the landscape of trademark infringement law considerably. However, no cases have been tried using this update… so far.

The Lanham Act

The Lanham Act – passed in 1946 – is the primary federal trademark statute of law in the United States. The Act prohibits trademark infringement, trademark dilution, false advertising, and also provides remedies for acts of counterfeiting. It allows for an award of damages for these violations, but varies widely in interpretation across the different Federal Circuits. Generally speaking, the Act does not provide for a specific amount of statutory damages (outside of cases involving outright counterfeiting). Instead, it provides for a range of damages which vary depending on the conduct of the infringer and the totality of facts presented in the case.

The application of lost profits in trademark cases is inherently subjective. Until this recent ruling it relied entirely on intent and the deliberate actions of the infringer, a very abstract inquiry involving ascertaining the state of mind of the infringer. 

To put a set statutory damage amount into trademark infringement law could be considered heavy-handed for an underlying legal issue that's already a gray area. 

How do we account for trademark infringement? In copyright infringement law there are statutory damages, but it's relatively easy to account for how many copies of the copyrighted work were made. 

In the trademark world, you may not be able to count how many times the infringer used the mark. Maybe they put the mark on every single product, but didn’t sell all the products. Maybe the infringer is just advertising online – how many people saw the trademark in that case? Hard to prove. What about social media use of the brand that didn’t necessarily result in a sale? It’s a rabbit hole.

Litigation Strategies 

Clients always want to sue a trademark infringer for money damages. Typically, I tell my clients the most important thing is to stop the trademark infringer from using the mark and stop the brand confusion that is diluting the value of their own product and associated branding. We want to stop letting consumers get confused as to the source of the goods so that my client can start selling all of the products that they should rightfully be selling, rather than the infringer.

That injunctive relief is the most potent part of trademark law.

From an affirmative standpoint, this new interpretation of Section 43 (a) of the Lanham Act certainly shakes-up the equation. As a plaintiff, it's easier to show that you are entitled to their profits, and it lets us up the rhetoric a little bit in how we, as lawyers, can assert the case in a cease and desist letter, or the language we can use in the complaint. 

If we are defending the trademark infringer, we will need to counsel our client so they understand that they can’t just rebrand and expect the case to go away. This new interpretation might encourage plaintiffs to push trademark infringement cases a little further for a settlement.

We have been very focused on stopping the use of a trademark, and not so focused on any type of past damages in the settlement negotiation. Now, that will change because we have a heavier hammer to hold over the defendant. 

Related: Beyoncé, Blue Ivy, and the Kardashians: The (Big) Business of Trademarks

Why Change the Law?

This Supreme Court ruling on 43 (a) was decided in April 2020, so it has not been litigated yet. It will be interesting to see how the district courts use this ruling to determine damages, what is still available for trial, and what the statutory damages numbers are going to be. 

The change is driven by the fact that different circuit courts around the country applied a different standard of the Lanham Act in their rulings. The Supreme Court did not look at these differing interpretations as a massively important trademark issue, they clarified the Act because of the widely varying interpretation of it.

That's one of the jobs of the Supreme Court – to resolve laws that are being interpreted differently around the country to make them more consistent. It was simply administerial work by the Supreme Court to resolve varying opinions. 

Since we have not yet seen judgments based on this new update, we will have to wait and see how it’s applied in trademark infringement cases. 

I am excited to bring you an update once we can see how the law is interpreted and used in a real-world case. It could make a serious change to trademark infringement litigation.

Drop us a message to find out how we can help you reclaim your IP.

Related: USPTO Updates Trademark Filing Requirements - But Will Spam Stop?

Is it Time to Stop Litigating Obsolete Technology? TiVo vs. Comcast

After a four-year battle against Comcast Corp., DVR tech creator TiVo Corp. won an appeals court ruling on one of its patents in March 2020. This win may help in its ongoing fight over two more patent royalties. But is DVR technology, which is rapidly becoming obsolete, really worth fighting for?

Is it Worth the Fight?

When DVR technology first came out, it was groundbreaking. It killed VCRs and any other type of recording and changed the dynamic by which people digested their television. It was a rapid adoption of a brand new technology.

At first, DVRs were standalone (i.e. the original TiVo boxes). Then, they were built into every cable set-top box. But now, as we stream more and more of our content and pay for subscriptions to Netflix, Hulu, Amazon TV, and more, many may wonder why these tech companies are arguing over an almost-obsolete technology that’s quickly going out of fashion. 

Most of us in the “technology-aware realm” are cord-cutters and stream everything. We don’t really do DVRs anymore. However, the vast majority of the country still gets their television through a cable box. Plus, live sports (if that ever happens again) still relies heavily on broadcast television, and requires some form of recording for delayed/on-demand viewing.

Many people still haven't cut the cord. They want to be able to record the news or live sports so they can watch it later. I think it is becoming an obsolete technology, but it's still a powerful force out there and likely drives a continued revenue stream for companies who control that technology. Also, think about that large swath of rural America that doesn’t have access to super-fast internet, and older communities that aren’t as tech-savvy.

TiVo and the DVR technology became ubiquitous. Every cable provider includes a DVR as an option in the cable box they give you. Even though you're not buying it by itself, it still contains technology that someone is buying and passing onto you in their costs.

Related: We’re Not Just Your Outside Law Firm. We’re Your Chief IP Officer 

Reasons to Fight

Many people just like to sit down with their remote control, click through the channels, and be able to record and view later all the episodes of whatever they're watching. I think that might be one of the reasons this case is still being fought. There's still a big market out there for DVRs – or at least the technology and functionality that is embedded in them. 

TiVo is the plaintiff here, trying to reap the benefits of what is their original technology. Even now that it's kind of ubiquitous, and seemingly lots of companies are using the technology, it's still worth money. They might not be trying to get DVR customers on their own anymore, but the revenue train for DVR technology is undoubtedly still out there. I don't think it's a nominal amount at stake.

The threshold for when to stop litigating a patent is most commonly when it is no longer financially beneficial for you to do so. Also, the patent laws provide for a 6 year statute of limitations. This allows you to go back six years for damages, even after the patent has expired. Those prior six years might contain billions of dollars worth of sales and you can still collect revenue in a lawsuit based on those prior sales. 

In the TiVo vs. Comcast case, we're talking about technology that's become so ubiquitous that there are still very, very large volumes of sales, both in terms of numbers and dollars. There are certainly lots of cases that we deal with where companies are like, “why should we even bother patenting this? We know the technology is going to change in three years.” But here, with the benefit of hindsight and a 20-year patent, it is still likely a winning scenario for TiVo to keep pushing the case.

Patent Aggregation and the Tech Sector

Things have shifted for the smaller companies that might not normally invest heavily in protecting their technology through the patent system. Because of patent aggregation firms, there is now value in applying for patents on technology that might be obsolete in a few years or that you might not commercially pursue on your own.

These firms buy patents from small businesses, keep them, and litigate them where they can take a cut of the recovery. No matter how small the technology, or how likely it is to be obsolete in a few years, these patents can now be monetized providing a potential revenue source for companies outside their true core competencies. 

Many companies don’t realize that there is not a requirement to produce and sell your invention (a so-called ‘working requirement’) in the US patent laws. I can come up with an inventive idea, patent it, but never build it or commercialize it. If someone else does five years later and sells a billion of them, I now have the right to sue them. That's what patent aggregation companies such as Fortress Investment Group are doing. They're aggregating all the patents and then trying to monetize them through the litigation system.

Related: Fortress Investment Group: Bad Actor, Bad Timing, or Both? 

Where are TiVo and Comcast Now?

Now, Comcast is not allowed to import its set-top boxes into the US. The import ban was issued by the US International Trade Commission and was affirmed in March by the US Court of Appeals for the Federal Circuit. 

In June, the Supreme Court denied a petition by Comcast to review the import ban on the case.

TiVo is currently seeking further orders to limit imports of Comcast set-top boxes based on other TiVo patents. 

“We understand the value of our patented technology and why Comcast has relied on it heavily since launching its X1 platform,” Arvin Patel, TiVo's chief intellectual property officer, noted in a public statement. “We are hopeful today's announcement will encourage Comcast to put their customers first and license our IP just as the other top nine US pay-TV providers do.”

The patents being disputed in the ongoing cases are centered around remote access to program guide functions in set-top boxes made by Commscope Holding Co.'s Arris International and Technicolor SA for Comcast.

We are currently waiting on two more court decisions to come out. We will keep you updated on our blog.

Stealing or Buying a Stairway to Heaven? All That Glitters Is Not Gold

Stealing or Buying a Stairway to Heaven? All That Glitters Is Not Gold

Like most boys of my vintage, I grew up as a classic rock fan. Led Zeppelin has been in my blood since I was thirteen. The words and music of Stairway to Heaven is burned into my brain. When it comes on the radio, I can sing every single word, and I can hum every single bar of the melody and solos. It was one of the first, if not the first, song I learned to "play" on a guitar. That opening lead line is about as classic as it gets, and why I wanted to learn how to play the guitar. Not even the whole song, just that intro! If you listen very hard, the tune will come to you at last. I bet you are humming it right now.

I can remember dancing to the song at my middle school dance in the '80s. It starts out as a slow dance, and then it rocks out. What do you do? You're slow dancing with someone, the song has a bridge, and then shifts to hard, heavy rock. You're standing there awkwardly with your date, and you're like, 'Okay, how do we do this now?' 

That's the classic Stairway to Heaven scene in my head. Today, my kids know that song. This is legendary music that spans generations. It's a monumental song in the history of music, and its reach spans generations.

That's why this case spoke to me!

The Case

Spirit brought a copyright infringement case against Led Zeppelin that claimed the opening lead lines of Stairway to Heaven were lifted from its song Taurus. It is just a short snippet that is allegedly infringing Spirit's copyright. Because it is in the intro, you only hear that intro riff once, right up there at the front of the song, and it is not repeated.  Listening to the two melodies side by side, I admit they sound similar.

If we were to compare this case to a similar copyright infringement case between Katy Perry and Flame, I would say, trying to be as objective as I can, that Stairway to Heaven was much closer to the Spirit song than Katy Perry was to Flame.  See the link below for my article on Katy.

Related: Katy Perry Escapes Dark Horse Copyright Verdict 

As discussed in more detail below, the jury was never allowed to hear the actual recordings of these two songs.  If they were allowed to listen to the Stairway to Heaven intro and the Taurus intro side by side, it certainly would have changed the case.  They would have had a much easier time telling that the two lead lines were very similar.  When you dig into the music, there is merely a subtle difference in the melody; the last note is the only real difference. The tone of the guitar is very similar; the pieces are very similar.  

Here is a comparison on YouTube for you to listen to

What was also surprising to me after hearing the two lead lines was that Led Zeppelin and Spirit not only knew each other but also were tour buddies during the time period the alleged copying occurred! Just anecdotally, you think, 'Well, that's copying.' Access is a vital component of copyright infringement. If you create something by yourself that's identical to someone else's, but you never had access to the original to copy it, you're unlikely to be found guilty of infringing copyright. Independent creation is a defense to copyright infringement.  

Why Was The Jury Not Allowed To Hear The Songs or Evidence About the Bands’ Relationship? 

Led Zeppelin was found not to be infringing on Spirits' copyright, and there was much hand waving and yelling about Led Zeppelin winning on a technicality. Well, that is not entirely true; the law is the law. Led Zeppelin's legal team did not use a technicality - they just used the proper law. 

Stairway to Heaven and Taurus were both made before 1973 when the copyright law changed to include recorded material. During the case, the judge had to apply the prior version of the copyright law from 1903! 

Wait, what . . .!

In 1903 there was no such thing as a sound recording, so the 1903 copyright law only covered written materials. So the jury could view the sheet music, but not listen to the actual song recordings. What average person can actually read sheet music effectively, let alone make a comparison as to similarity under a 1903 law? Spirit did not have the right to play the songs in court, and unfortunately, Spirit's lawyer knew that going in. If the alleged violation had been ten years later, it would have been a completely different set of rules to follow, and the judgment may have been different. 

Likewise, and what probably helped Led Zeppelin the most in this case, the court decided to abandon a long-held legal principle regarding the role 'access' could play in a copyright determination. This resulted in the jury not being able to hear the evidence about the relationship between the two bands and what might have led to further evidence of access to the specific song. So, left only with the sheet music, they understandably concluded no infringement.

When I see the correct laws applied and upheld, such as this case, it gives me some comfort, knowing that the rule of law is still in place. Us lawyers, that's how we function. If the courts don't follow the rules, our whole business model breaks down. I have to know that other people are going to follow the same standards and regulations that I'm following: they will follow the law to the letter. That's the only way it works.

Related: Taylor Swift, Big Machine and Audible: The Battle over Copyright Control

My Judgment

The jury's decision was probably correct based on the evidence they were allowed to hear at the time. The jury was not allowed to listen to the evidence that the bands toured together, in addition to not being allowed to listen to the recordings. That is critical. Based on the evidence they heard, and following the law, they were supposed to follow - they made the right decision.

As a matter of public policy, it doesn't feel like the right decision, but reasonable minds can differ. Cause you know, sometimes words have two meanings. As a matter of being a Stairway to Heaven and Led Zeppelin fan… I think it was totally the right decision. 

If I were a member of the jury and had been able to listen to the riffs during the trial, and I knew about the bands touring together, to be honest, I probably would have ruled against Led Zeppelin myself, because even for a fan like me, there are two paths you can go by and sometimes all of our thoughts are misgiving

The Take-Away For Creatives 

  1. Understand the current state of the law and how it applies to your creation. Do your research before taking the matter before a court.
  2. Remember that that law might be interpreted differently depending on where you reside and where you create your work of art. There are 12 circuits in the USA; all have slightly different interpretations for issues that get complicated like this. Different facts will have different levels of impact depending on where you reside and where you bring the case. 
  3. Find out the best state to sue for copyright infringement. There might be jurisdictions where the facts and the application of the law are a little more beneficial to your situation, and you might be able to sue in a different venue that would be more beneficial to you.
  4. Know whether you have jurisdiction in the state you want to sue them in. Does the court have authority against that person?