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Happy Holidays to
All
Cases
and Issues of Interest
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Copyright
Law
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Patent Law
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Trademark Law
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President Bush Signs Madrid Protocol
Implementation Act for Trademarks
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Into Law
US Patent and Trademark Office
News
Available Intellectual Property Services
in the U.S.A.
In lieu of
printing and US government postage costs, this year we have
provided support for a local school for handicapped
children. You can see more about their mission at www.stcoletta.org/about/index.html. We are
grateful for the support of our clients. Your support
throughout the year has allowed us to contribute to a few who
may be less fortunate.
Happy
Holidays to All
Cases of
Interest:
Copyright
Law:
Defendant
found Not Guilty by Jury in Digital Millennium Copyright
Case
United States v.
ELCOM LTD. a/k/a Elcomsoft Co., Ltd. and Dmitry Sklyarov, 203 F.Supp. 2d
1111, (USDC ND California, filed 8-28-02)
On Tuesday of this
week (12-17-02), a California Jury found Dmitry Sklyarov ("Elcom") not
guilty of violating 17 USC § 1201 (b)(1)(A) (The
Digital Millennium Copyright Act ("DMCA")) and conspiracy to violate
the DMCA. It has been reported that the basis of the jury verdict is
that the necessary element of intent to violate the statute was not
found. The penalty for violation of § 1201 willfully and for
commercial gain is substantial -- up to $500,000 in fines or between 1
and 5 years in prison for a first offense and up to $1,000,000 fine or
up to 10 years in prison for subsequent violations. As of this writing,
a Notice of Appeal by the government has not been
filed.
The jury verdict
follows on the heels of the District Court's Denial of Elcom's Motion to
Dismiss on the grounds of vagueness, violation of the 1st Amendment and
being inconsistent with the Intellectual Property Clause of the US
Constitution.
Adobe
developed an ebook that is accompanied by an electronic "voucher" which
is recognized and read by the Adobe Acrobat eBook Reader, which then
"knows" that the copy of the ebook can only be read on the computer onto
which it has been downloaded. Thus, typically, the purchaser of an ebook
may only read the ebook on the computer onto which the ebook was
downloaded but may not e-mail or copy the ebook to another computer. The
user may or may not be able to print the ebook in paper form or have it
audibly read by the computer.
Elcom
developed and sold a product known as the Advanced eBook Processor
("AEBPR"). AEBPR is a Windows- based software program that allows a user
to remove use restrictions from Adobe Acrobat PDF files and files
formatted for the Adobe eBook Reader. The program allows a purchaser of
an eBook Reader formatted electronic book to convert the format to one
that is readable in any PDF viewer without the use restrictions imposed
by the publisher.
The
conversion accomplished by the AEBPR program enables a purchaser of an
ebook to engage in "fair use" of an ebook without infringing the
copyright laws, for example, by allowing the lawful owner of an ebook to
read it on another computer, to make a back-up copy, or to print the
ebook in paper form. The same technology, however, also allows a user to
engage in copyright infringement by making and distributing unlawful
copies of the ebook.
17 USC § 1201
(b)(1)(A) (The Digital Millennium Copyright Act ("DMCA"))
provides
that "[n]o person shall circumvent a technological measure that
effectively controls access to a work protected under this
title."
17
USC § 1201(a)(2) provides that:
" [n]o person shall manufacture,
import, offer to the public, provide or otherwise traffic in any
technology, product, service, device, component, or part thereof,
that--
(A) is primarily designed or produced for the purpose of
circumventing a technological measure that effectively controls access
to a work protected under this title;
(B) has only limited
commercially significant purpose or use other than to circumvent a
technological measure that effectively controls access to a work
protected under this title [17 U.S.C. § 1 et seq.]; or
(C) is
marketed by that person or another acting in concert with that person
with that person's knowledge for use in circumventing a technological
measure that effectively controls access to a work protected under this
title."
Elcom
argued that the DMCA was unconstitutionally vague and that it violates
the 1st Amendment because it constitutes a content-based restriction on
speech that is not sufficiently tailored to serve a compelling
government interest, it impermissibly infringes upon the 1st Amendment
rights of third parties, it is too vague to determine what speech it
prohibits and it exceeds Congress' enactment power.
Regarding
vagueness, the Court held that the prohibited conduct is the
distribution, marketing or trafficking of devices that are designed to
bypass use restrictions in order to enable a fair use, as opposed to an
infringing use. Fair use is a limitation of a copyright owner's rights
and allows limited use for limit purposes that would otherwise be
infringing. Therefore, under this Court's ruling, tools may be developed
to circumvent use restrictions for fair use purposes, but the developed
tools may not be distributed or marketed. The Court rationalized that by
allowing the development, but not the distribution of circumvention
tools, a balance would be struck between fair use and copyright
protection for the creator of the circumvented software or other
expression.
Regarding
Elcom's First Amendment challenge, the Court recognized that the First
Amendment is triggered, because software includes creative expression.
Only English speakers will understand English formulations. Principally
those familiar with the particular programming language will understand
the source code expression. And only a relatively small number of
skilled programmers and computer scientists will understand the machine
readable object code. But each form expresses the same idea, albeit in
different ways. The Court held that the control under the DMCA is content neutral and therefore, is sustainable
if it furthers an important or substantial government interest; if the
governmental interest is unrelated to the suppression of free
expression; and if the incidental restriction on alleged First Amendment
freedoms is no greater than is essential to the furtherance of that
interest. The Court held that because the statute targets
the conduct of trafficking in devices, and not speech, and therefore
intermediate scrutiny is appropriate. Because the government has
an interest in preventing the unauthorized copying of copyrighted works
and promoting electronic commerce, and the DMCA is narrowly tailored to
allow fair use, the DMCA is not unconstitutional under the First
Amendment.
The
Court held that the DMCA is not overly broad because third parties are
still free to use public domain materials even though they may not have
circumvention tools available to bypass copy protection systems of
publishers who distribute repackaged public domain
material.
In
another important aspect of the opinion, the Court held that the DMCA is not unconstitutionally vague because in order
to trigger a violation, a person must have the intent to design a device
that is primarily designed or produced for the purpose of circumventing
a technological measure that effectively controls access to a work
protected under this title if the device has 'only limited commercially
significant purpose or use other than to circumvent a technological
measure. In order to determine if the code violates the DMCA, the
seller must assess all possible uses of the technology and determine
which are the "significant purpose[s] " and what it is "primarily"
designed to do.
Finally,
the Court also rejected Elcom's argument that Congress exceeded its
powers under the Intellectual Property Clause ("IPC") in enacting the DMCA. Congress' power under the Commerce Power has
never been successfully challenged and this case did not change
that. With respect to the IPC, the Court held that Congress has
the power to "promote the useful arts and sciences" and did so by
protecting copyright owners rights. The anti-device provisions
were therefore found to be not inconsistent with the IPC.
Copyright Violation of Translation of Hebrew Prayerbook
Found
Merkos L'Inyonei
Chinuch, Inc. v. Otsar Sifrei Lubavitch, Inc., 2002 WL 31641697 (2nd
Cir. (N.Y.), November 25, 2002)
The dispute involved
Merkos claim that Otsar violated its copyright by copying verbatim Rabbi
Nissen Mangel's English translation of the Hebrew prayers, which appears
in Merkos' prayer book.
The District Court
granted Merkos motion for preliminary injunction and the Court of
Appeals affirmed.
Ostar argued that the
translation lacked the necessary originality to be a copyrightable
literary work and that Merkos did not hold the copyright. The
court found that the translation process requires "exercise of careful
literary and scholarly judgment" and therefore includes the necessary,
minimal level of creativity to be protectable by copyright. Otsar
also argued that there was a merger of the idea and expression, thereby
precluding protection by copyright. In other words, if there was
only one literal translation of the prayer book, then copyright would
not grant a monopoly over the translation. The Court of appeals
rejected the idea-expression merger argument, relying upon the District
Court's opinion, where it stated, "[t]he tranlation of prayers...
involves partly the precision of science but partly the sensitivity and
spirit of art. Behind the words that are found in the Hebrew and the
words that are used in the English are shades of meaning and subtlety
that cannot be labeled functional."
The Appellate Court
also found that the Rabbi, who prepared the translation, satisfied the
"work for hire" doctrine because he prepared the translation "within the
scope of his or her employment."
The Appellate Court
also rejected the argument that it did not have the jurisdiction to
decide religious law or doctrine. The Court stated that "Courts
may decide disputes that implicate religious interests as long as they
can do so based upon 'neutral principles' of secular law without undue
entanglement in issues of religious doctrine." This case, the Court
stated, can clearly be decided under secular law principles because
"Merkos is a corporate entity, and it is controlled by a duly selected
board."
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Patent Law:
Virginia Eastern
District Court Denies Invention Promotion Company Motion for
Review
Invention
Submission Corporation v. James E. Rogan, Undersecretary of Commerce for
Intellectual Property and Director, United States Patent and Trademark
Office, 2002 WL 31477290 (E.D. Va., October 30,
2002)
The US Federal District Court for the
Eastern District of Virginia heard this case that arose out of
efforts by the US Patent and Trademark office ("USPTO") to implement the
invention promotion section of the American Inventors' Protection Act
("AIPA") . The Act includes provisions of the Inventors' Rights
Act of 1999 and is designed to protect inventors who each year "lost
tens of millions of dollars" to "invention promotion scams." 141 Cong.
Rec. S14521 (Nov. 10, 1999). The opinion was issued by District
Judge L. Brinkema (See another opinion at Lucent Technologies v.
Lucentsucks.com).
Under the AIPA, an
inventor may file a complaint against an invention promotion company by
with the USPTO, by filing an online form. The
invention promotion company is then given 30 days to respond. The
invention promoter's response and the complaint will be available to the
public.
Edward Lewis
("Lewis"), an inventor filed a complaint with the USPTO against the
invention promotion company, Invention Submission Corporation ("ISC").
In the complaint, Lewis alleged that he paid ICS for help in marketing
his invention and received nothing in return. Lewis stated that
the "representative indicated to me that I would make a lot of money
with my invention and I have made nothing."
The USPTO meanwhile,
was preparing a media campaign to warn inventors about invention
promotion companies and they asked Lewis to appear in television and
print advertisements. Lewis agreed and in his statements, he said
that he "spent $13,000 and three years and "[hasn't] seen a
penny."
Although the USPTO
campaign did not identify ISC, a news reporter who covered the story,
obtained ISC's name from Lewis and published it in a news story.
ISC settled with Lewis
and as a result, Lewis requested that his complaint be withdrawn, and
that they discontinue using his statements in their media
campaign.
The lawsuit was
brought as a review under the Administrative Procedures Act ("APA") in
an effort to prevent the USPTO from continuing to use Lewis' statements
in their campaign.
The Court held that
the USPTO's conduct in publicizing Lewis' complaint outside the neutral
forum mandated by the IRA, together with its purported determination
that Lewis was a victim of a "scam," was a final agency action
reviewable under the APA. However, the Court found that the USPTO
did not intend to harm ISC because it did not mention its name in any of
its materials. Because Lewis requested that his complaint be
withdrawn, it was never published and it was Lewis, not the USPTO, who
identified ISC to the news reporting agency.
The court also found
that remarks made by a USPTO official that were disparaging generally to
invention promotion companies were not equivalent to the agency imposing
a sanction on the plaintiff. Furthermore, any harm to ISC's
business would be the indirect result of the reactions and choices of
individual inventors.
The Court therefore
denied ISC's Motion.
Limitations in
Preamble of Claim Should Not be Read Into Body of Claims
Alfred J.
SCHUMER v. LABORATORY COMPUTER SYSTEMS, INC. and Wacom Technology
Corporation, 308 F.3d 1304 (Fed. Cir., October 22,
2002)
The plaintiff
("Schumer") appealed the judgment of the US District Court for the
Western District of Washington granting summary judgment in favor of
Laboratory Computer Systems ("LCS") and Wacom Technology Corporation
("Wacom").
The Court of Appeals
for the Federal Circuit ("CAFC") held that the District Court erred in
construing the claims 1-10 of US Patent 5,768,492 ("the '492 patent"),
erred in finding clear and convincing evidence that claim 13 was
anticipated, and failed to analyze claim 14 and therefore, vacated and
remanded the case back to the District Court.
The '492 patent
relates to digitizing tablets ("digitizers"), which are computer
peripherals that translate a user's hand motions or instructions into
digital coordinates suitable for use by a computer system.
LCS creates and
distributes software drivers that are used with various digitizers and
Wacom is a licensee and distributor of LCS's drivers.
The CAFC first found
error in the District Court's opinion because it read the preamble of
claim 1 as imposing a claim limitation. It also found error in the
interpretation of the claims. The preamble of claim 1 recited a
... coordinate system has a point of origin and has an angle of rotation
with respect to the digitzer and has a scale, comprising... while
the body of the claim included ... one of the following elements is
different from the digitizer's coordinate system: location of the point
of origin, or angle or rotation, or scale...
The CAFC found that
the District Court effectively substituted the word "and" from the
preamble for the word "or" in the body of the claim. Such a
substitution would require literal infringement to include each of the
elements instead of only one of the elements.
The CAFC also
evaluated the prosecution history of the '492 patent and it did not
change the result. The resulting holding was that the accused
device performing the claimed method need only have the ability to
translate one of the three attributes of the coordinate system.
Therefore, the case was remanded to the District Court for an evaluation
of infringement that is consistent with this holding.
Back to top
Trademark Law:
No Initial
Interest Confusion for use of EPIX for Cabaret with EPIX for Electronic
Picture Equipment - Relief Limited
Interstellar
Starship Services, Limited et al. v. EPIX, INCORPORATED, 2002 WL
31096706 (US Court of Appeals, 9th Circ., September 20,
2002)
The 9th Circuit Court
of Appeals ruled that 1. domain name epix.com did not cause likelihood
of initial interest confusion with EPIX, INCORPORATED ("EPIX") among
consumers; 2. The registrant did not have a bad faith intent to profit
from the mark; 3. the transfer of the domain name from the registrant to
EPIX was not warranted; and 4. preventing the transfer of the domain
name by registrant to other third party was not warranted.
EPIX manufactures and
sells a wide variety of electronic imaging hardware and software
products and provides related consulting services. Michael Tchou
("Tchou"), the domain name registrant, registered teh domain name
epix.com because "the catchy name connoted electronic ('e') pictures ('pics')". He intended to develop the web site into a multimillion
dollar Internet portal, like Yahoo, featuring a variety of electronic
pictures.
Initial interest
confusion occurs when a defendant uses a plaintiff's trademark in a
manner calculated to capture initial consumer attention, even though no
actual sale is finally completed as a result of the confusion. The
court evaluated likelihood of confusion, including initial interest
confusion, by considering the "Sleekcraft" factors. Those factors are:
1. the similarity of the marks; 2. the relatedness or proximity of the
two companies' products or services; 3. the strength of the registered
mark; 4. the marketing channels used; 5. the degree of care likely to be
exercised by the purchaser in selecting goods; 6. the accused
infringer's intent in selecting its mark; 7. evidence of actual
confusion; and 8. the likelihood of expansion in product lines. In
the context of the Internet, the court held that the three most
important Sleekcraft factors in evaluating a likelihood of confusion
are: 1. the similarity of the marks; 2. the relatedness of the goods or
services; and 3. the parties' simultaneous use of the Web as a marketing
channel.
Tchou's primary
purpose of his web site was to promote a Cabaret and therefore, did not
compete with EPIX's electronic imaging products, even though Tchou's
site included incidental digital image processing and computer related
services on his web site at an earlier time in this dispute. The
district court also found that the parties marketed to different
consumer bases.
The district court
also found that EPIX's trademark was weak and that their customers
exercised a high degree of care purchasing expensive electronic imaging
equipment. The court of appeals found that EPIX had no exclusive
right to its trademark. At least 8 companies have registered the
EPIX mark or a close variation with the US Patent and Trademark Office,
and use the term in connection with a variety of different products,
such as men's and women's clothing and medical imaging agents.
Furthermore, the use of EPIX on the Internet is widespread.
The court of appeals
agreed with the district court's ultimate decision, that there was no
evidence of actual confusion and no likelihood that either company would
"bridge the gap" to the other company's products or services.
Regarding initial
interest confusion, the court of appeals determined that upon arriving
at Tchou's website (http://www.epix.com/), the consumer would not think
that EPIX licensed, sponsored, or owned Tchou's website. "She
would simply come to the inevitable and correct conclusion that more
than one company uses the EPIX name and that EPIX operates its website
at a different address. Indeed, any consumer looking for EPIX, who
mistakenly guessed that it could be found at http://www.epix.com/,
would realize in one hot second that she was in the wrong place and
either guess again or resort to a search engine to locate the EPIX site
at http://www.epixinc.com/."
The court of appeals
further supported its decision on the grounds that Tchou adopted the
name epix.com in good faith because it connoted electronic pictures and
no evidence indicated that he sought to trade on the goodwill of EPIX or
that either company intended to bridge the gap into the other's product
line.
The court of appeals
rejected EPIX argument that Tchou's offer to sell the domain name to
EPIX for $25,000 was evidence of bad faith under the Anticybersquatting
Consumer Protection Act. The court stated that offers to sell a
contested domain name may in certain circumstances be probative evidence
of bad faith, here the offer to sell can from Tchou's attorney in the
context of settlement negotiations after the commencement of
litigation.
The district court
awarded EPIX a limited injunction that forbade Tchou from promoting
digital image processing services and other computer-related
services. It did not however, require Tchou to transfer the
disputed domain name to EPIX. The court of appeals affirmed the
district court's decision not to order the transfer of the domain name
because a district court retains the discretion to fashion any remedy
which alleviates confusion.
President Bush Signs Madrid Protocol
Implementation Act for Trademarks Into Law
President Bush signed
into law this month the Madrid Protocol Implementation Act. The
Madrid Protocol allows trademark owners to file a single application in
their home country, referred to as a "basic" registration, and designate
member countries in which the applicant wants the application to
extend.
The provisions of the
Madrid Protocol ("the Protocol") are administered by the World
Intellectual Property Organization ("WIPO"). WIPO has published an
informative Madrid Protocol brochure.
Although there are
several downsides to the Protocol, it also offers advantages for both US
and non-US applicants. On the plus side, the filing fee to WIPO is
currently $450 USD for up to 3 classes and $50 USD for each designated
country. This is a substantial discount in comparison to filing in
each country individually, but it does not eliminate prosecution costs
that may be required in each country after filing.
Another advantage to
the Protocol is that member countries may be added to the application or
registration at any time. For a listing of the member countries,
see the Madrid Protocol brochure. Furthermore, any
administrative changes such as name change or ownership can be change at
a single location instead of changing the data at each country.
Yet another advantage
is the single 10 year renewal fee that is payable to WIPO.
The first problem
concerns first what is referred to as the "central attack"
provision. If, during the first five years after the date of
international registration, the basic application is refused or
withdrawn, or the basic registration is cancelled, the international
registration must also be cancelled. The applicant has a period of
3 months to file nationally in each country, but such a solution
obviously adds significantly to the expense.
A second problem
involves the amount of specificity required in an identification of
goods or services by the home country in the basic application.
The scope of the identification of the goods or services in the
international application cannot exceed the scope of the identification
in the basic, home country application. The USPTO is notoriously
strict in its narrow specificity requirements in comparison with most
other countries. At first the solution would seem to be to file in
non-US home countries to obtain a broad identification. However,
it remains to be seen whether applications entering the US via the
Protocol will be subject to narrowing.
Yet another problem
may be the time frame required during the filing of the application. The
national trademark office of each elected country has a 12 month
examination period in which to issue an initial refusal, which may be
extended up to 18 months, or longer if an opposition is filed. If
the national trademark office does not act within the allotted time
frame, the International Registration will take effect in that
country. Currently, the prosecution time frame at the USPTO for
trademark applications often exceeds 12 months.
The USPTO has one year
to prepare and implement the appropriate rules and procedures for
operating under the Protocol from the time Congress passed the
implementing legislation.
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US Patent and Trademark Office
News:
Reduction in Force (RIF) for Trademark Operations
On September 30th, 135
trademark examining attorney positions at the Trademark Branch of the US
Patent and Trademark Office were eliminated. This leaves a
remaining staff level of 248 examining attorneys. Although trademark
application filings peaked to 375,000 in 2000, the filing decreased 33%
to an expected 250,000 this year. The reduction in examining
attorneys has created a shift of many pending trademark cases to new
examining attorneys.
Construction of New
Carlyle Campus in Alexandria, Virginia Moving Briskly
Construction of the
new US Patent and Trademark Office campus on the Carlyle development in
Alexandria, Virginia appears to be moving along briskly. The most
recently available construction photos can be seen at the USPTO Pulse Report.
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Intellectual
Property Services in the U.S.A.
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