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from MEALEY'S LITIGATION REPORT: Intellectual Property November 3, 2003 Hasbro Files Suit Over 'Ghettopoly' Game PROVIDENCE, R.I. -- Alleging trademark and copyright infringement, the makers of the world famous board game "Monopoly" filed suit over a "very offensive" knock-off (Hasbro Inc. v. David Chang, No. 03-482, D. R.I.). (Complaint. Document #16-031103-021C.) According to Hasbro Inc., defendant David Chang -- promoter and creator of the board game "Ghettopoly"-- made use of Monopoly's intellectual property without authorization. "The game and its elements are obviously intentionally copied from the Monopoly real estate trading game. However, while the genuine Monopoly game has become a wholesome and respected American icon that has been enjoyed by millions of adults and children for generations, the Ghettopoly knock-off has generated a firestorm of controversy for its highly offensive, racist content," Hasbro says. Among the copyrights in the original graphic expressions relating to the Monopoly game are those for the game board as a whole and for the game's playing rules. Chang uses a design that closely imitates the Monopoly logo, game board and packaging according to Hasbro. Like the Monopoly logo, the Ghettopoly logo comprises the red and white-trimmed color scheme and is enclosed in a rectangular design. In addition, according to Hasbro, Chang's game features a character emerging from the middle "O" with its arms widely outstretched, although the defendant's character "is a gross caricature of an African-American man with outstretched arms holding an Uzi submachine gun in one hand and a bottle of malt liquor in the other." Copyright 2003, LexisNexis, Division of Reed Elsevier Inc., All Rights Reserved This story and the complete archive of Mealey's Litigation Reports including related court documents are available online by subscription or on a pay-per-view basis. Go to Mealeys Online.
from MEALEY'S LITIGATION REPORT: Intellectual Property October 20, 2003 Sanctions, Dismissal In ACPA Case Vacated, Remanded By 2nd Circuit Panel NEW YORK -- Because it is possible that a plaintiff had alleged a legally sufficient claim under the Anticybersquatting Consumer Protection Act (ACPA) based on events since a related action was filed and disposed of, dismissal on res judicata grounds was erroneous, the Second Circuit U.S. Court of Appeals ruled Oct. 9 (Lawrence Storey v. Cello Holdings L.L.C. and Cello Music and Film Systems Inc., No. 02-7281, 2nd Cir.). (Opinion. Document #16-031020-113Z.) Because Cello Holdings L.L.C. may have a claim premised on facts arising after the first action, which was dismissed with prejudice after a settlement -- later abandoned -- had reportedly been reached, the doctrine is not dispositive, the court said. "The 'bad faith intent to profit' element of a trademark rights-holder's ACPA claim may be premised on the domain-name registrant's ongoing use of the domain name. In this respect ACPA rights differ from traditional property rights in land, to which ownership of a domain name is often analogized. The judgment in the First Action, therefore, does not bar Cello from arguing that [plaintiff Lawrence] Storey's use of 'cello.com' is unlawful insofar as Cello relies on conduct post-dating the First Action to make its claim," the court said. Retailers of "high end" audio equipment under the Cello name since 1985, Cello Holdings registered the trademark "Cello" in 1995. Storey, in 1997, attempted to register with Network Solutions Inc. approximately 20 domain names consisting of single noun names of musical instruments, including guitar.com and violin.com, all of which were registered, including cello.com. In 1997, Cello sued, alleging that Storey was a cybersquatter who diluted its trademark by attempting to resell the domain name. Storey defended the registration by arguing that Cello failed to demonstrate that the mark was distinctive or famous and asserted that "cello" was a common noun used in the name of dozens of businesses. Cello filed an arbitration complaint with eResolution, asserting that the domain was confusingly similar to the "Cello" mark, that Storey had no rights in the domain and that cello.com was obtained in bad faith. The online arbiter agreed and ordered transfer to Cello. Storey sued in the U.S. District Court for the Southern District of New York, seeking a declaration of lawfulness in connection with his registration and use of cello.com. Deeming application of res judicata to the case appropriate, Judge Denny Chin held that Cello was barred from reasserting its claims in the arbitration proceeding. Copyright 2003, LexisNexis, Division of Reed Elsevier Inc., All Rights Reserved This story and the complete archive of Mealey's Litigation Reports including related court documents are available online by subscription or on a pay-per-view basis. Go to Mealeys Online.
______________________________________________________________ from MEALEY'S LITIGATION REPORT: Patents November 3, 2003 Clarification
Is Not Surrender, Panel Finds WASHINGTON, D.C. -- A clarification of an examiner's mistake does not amount to the clear and unmistakeable surrender of subject matter of a claim for creating argument-based estoppel to an assertion of infringement under the doctrine of equivalents, the Federal Circuit held Oct. 17 (Deering Precision Instruments, L.L.C. v. Vector Distribution Systems, Inc., et al., Nos. 02-1013, -1197, Fed. Cir.). (Opinion. Document #16-031103-103Z.) A Federal Circuit panel affirmed summary judgment by the U.S. District Court for the Northern District of Illinois that Vector Distribution Systems Inc. did not literally infringe a Deering Precision Instruments L.L.C. patent but vacated and remanded the lower court's grant of summary judgment of no infringement by equivalents. The patent relates to a pocket-type scale for weighing substances up to 10 grams. Specifically at issue was a limitation known as the "zero position limitation," in which when the sliding weight is in the zero position, a portion of it is "disposed substantially" in an imaginary plane containing the fulcrum. In the accused product ,the sliding weights have no portion extending into that plane when in their zero positions. The District Court found no literal infringement after construing the limitation to mean that the weight must enter and penetrate the imaginary plane containing the fulcrum. It also found that because the applicants amended the limitation during prosecution by deleting an original claim, equivalents for the limitation were barred for every asserted claim under the Federal Circuit's decision in Festo Corp. v. Shoketsu Kinzoku Kogyo Kabushiki Co. (234 F.3d 558 [Fed. Cir. 2000]). The lower court noted that though two claims at issue were not amended during prosecution, Deering was barred from asserting the doctrine of equivalents under Builders Concrete, Inc. v. Bremerton Concrete Products Co. (757 F.2d 255 [Fed. Cir. 1985]), finding that prosecution history estoppel applies to any limitation narrowed during prosecution in all claims in the patent regardless of whether the limitation is present in a claim that itself was never amended. Copyright 2003, LexisNexis, Division of Reed Elsevier Inc., All Rights Reserved This story and the complete archive of Mealey's Litigation Reports including related court documents are available online by subscription or on a pay-per-view basis. Go to Mealeys Online.
from MEALEY'S LITIGATION REPORT: Patents October 20, 2003 Divided
Federal Circuit Affirms Judgment, Infringement Findings WASHINGTON, D.C. -- Claim construction "must be based primarily on the record established at the time the patent was granted," the Federal Circuit held Sept. 25, finding evidence from a later re-examination "of little consequence" (Arlington Industries, Inc. v. Bridgeport Fittings, Inc., Nos. 02-1517, -1518, Fed. Cir.). (Opinion. Document #16-031020-102Z.) In a divided panel opinion, the court affirmed the judgment and a permanent injunction entered by the U.S. District Court for the Middle District of Pennsylvania, finding that Bridgeport Fittings Inc. had infringed an Arlington Industries Inc. patent relating to electrical box extenders used to bring electrical boxes flush with newly installed sheet stock. At issue were the claimed "wings" of the box that "tend to flex inwardly" when the extender is inserted into an existing electrical box. Bridgeport asserted that the language encompassed only cantilever flexing, citing the written description and the prosecution history, but the District Court applied the ordinary and customary meaning in holding that the language encompasses a generalized combination of cantilever bending and bowing about the general area of the base or base end of the extender. On appeal, Bridgeport pointed to language in the description of the invention section describing the "flexing of the wings" as cantilever bending. "Bridgeport equates this 'cantilever bending' with 'cantilever flexing,' and essentially invites us to import a limitation from the preferred embodiments to restrict the meaning of a claim term. We have consistently warned against this approach to claim construction, which is seldom justified," Circuit Judge Richard Linn wrote for the majority. There is no evidence that the applicant acted as his own lexicographer and clearly set forth a definition of the disputed claim term, "nor do we discern therein any express disclaimer of a particular meaning of 'flexing,'" the majority said. Regarding the prosecution history, Bridgeport argued that the applicant disclaimed non-cantilever flexing to distinguish the invention from the prior art. The examiner initially had rejected the application as obvious over a combination of references, including a prior art patent called the Kleinatland patent. Copyright 2003, LexisNexis, Division of Reed Elsevier Inc., All Rights Reserved This story and the complete archive of Mealey's Litigation Reports including related court documents are available online by subscription or on a pay-per-view basis. Go to Mealeys Online.
______________________________________________________________ from MEALEY'S LITIGATION REPORT: Trademarks October
20, 2003 WASHINGTON, D.C. -- A Minnesota businessman is the legal owner of the trademark "America's Team," according to the U.S. Trademark Trial and Appeal Board (TTAB) (United States Olympic Committee v. MEOB Inc. and America's Team Properties Inc., Cancellation No. 92025167, TTAB). (Opinion available. Document #16-031020-012Z.) Contrary to assertions by the U.S. Olympic Committee (USOC), Bryan Reichel did not abandon the trademark through nonuse, according to the administrative panel. Even assuming arguendo that Reichel's activities do not constitute "use in commerce" under the Lanham Act and that -- as a result -- the USOC has established a prima facie case of abandonment, "such prima facie case has been rebutted," the board said. "Any nonuse of the mark by respondent which occurred after the institution of this cancellation proceeding is excusable nonuse," the TTAB found. Reichel, the owner and operator of America's Team Properties Inc., purchased the rights to the trademark in 1998 from MEOB Inc., which at the time was involved in litigation with the USOC over the trademark. In suing Reichel, the USOC argued that it is the owner of the mark and demanded that Reichel withdraw his registration and cease any use or intended use of the America's Team trademark. As a result of the "cloud of uncertainty" surrounding Reichel's rights to the name, Reichel limited his use of the mark pending the outcome of a cancellation proceeding, the board said. Citing the precedent set forth in Penthouse International v. Dyn Electronics (196 USPQ 251 [TTAB 1977]), which held that nonuse of a mark as a result of ongoing litigation to determine ownership is acceptable, the TTAB rejected the USOC's argument. "Additionally . . . assuming that petitioner has established a prima facie case of abandonment and thus is entitled to an inference that respondent does not intend to resume use of the mark, such inference is rebutted by the fact that respondent has actively defended its right to its registration by litigating this proceeding throughout the more than seven years in which the proceeding has been pending," the board said. "Likewise, even if we were to assume that respondent's activities with respect to the mark undertaken after the institution of this proceeding do not constitute technical use of the mark in commerce . . . these activities certainly preclude any finding that respondent has abandoned all claims to the mark or that respondent has no intent to resume use of the mark in the event that the proceeding is concluded in its favor," the TTAB held. Copyright 2003, LexisNexis, Division of Reed Elsevier Inc., All Rights Reserved This story and the complete archive of Mealey's Litigation Reports including related court documents are available online by subscription or on a pay-per-view basis. Go to Mealeys Online.
from MEALEY'S LITIGATION REPORT: Trademarks September 22, 2003 Divided Appellate
Panel Issues Ruling On 'Material Difference' Test For Trademarks
WASHINGTON, D.C. -- Consumers have different expectations for used or refurbished goods versus new products, and a "material difference" test used in the context of determining potential trademark infringement of altered new goods should not be applied to used or refurbished goods, the Federal Circuit held Aug. 26 (Nitro Leisure Products, L.L.C. v. Acushnet Company, No. 02-1572, Fed. Cir.). (Opinion. Document #16-030922-104Z.) In a divided opinion, an appeals panel upheld the denial of a motion for a preliminary injunction by Acushnet Co., a company that makes and sells golf balls and equipment under the trademarks TITLEIST, ACUSHNET, PINNACLE and PRO V1, against Nitro Leisure Products L.L.C., which refurbishes and sells used golf balls. The U.S. District Court for the Southern District of Florida found that Acushnet failed to show a reasonable likelihood of success on the merits of its infringement and dilution claims. Acushnet asserts that Nitro's refurbishing process so alters the basic composition of Acushnet's golf balls that they bear no resemblance to a genuine Acushnet product in performance, quality or appearance. That process includes cosmetically treating the balls by removing the base coat of paint, the clear coat layer and the trademark and model markings without damaging the covers of the balls, and then repainting the balls, adding a clear coat and reaffixing the original manufacturer's trademark. The balls are marked with legends designating them as refurbished, and the balls are packaged in containers displaying a disclaimer. On appeal, the Federal Circuit noted that to succeed in its request for a preliminary injunction on its trademark infringement claim, Acushnet must show a likelihood of success on its claim that the sale by Nitro of its refurbished golf balls bearing reapplied Acushnet trademarks is likely to cause confusion. Copyright 2003, LexisNexis, Division of Reed Elsevier Inc., All Rights Reserved This story and the complete archive of Mealey's Litigation Reports including related court documents are available online by subscription or on a pay-per-view basis. Go to Mealeys Online.
______________________________________________________________ from MEALEY'S Cyber Tech & E-Commerce October 13, 2003 Vermont's Law To Protect Minors From Net Porn Runs Afoul Of 1st Amendment NEW YORK -- A Vermont state law designed to prevent sexually explicit materials from being seen by minors was correctly ruled unconstitutional on free speech grounds and under the dormant commerce clause, a federal appeals panel ruled Aug. 27 (American Booksellers Foundation, et al. v. Howard Dean, et al., No. 02-7785, 2nd Cir.; 2003 U.S. App. LEXIS 17908). (Opinion. Document #24-031013-104Z.) The Second Circuit U.S. Court of Appeal affirmed a permanent injunction from the U.S. District Court for the District of Vermont preventing the enforcement of two sections of a 2000 Vermont law called "An Act Related to Internet Crimes." However, the Second Circuit panel modified the injunction so that it applies only to Internet-related activities. The law was challenged by numerous plaintiffs, including the Sexual Health Network, Inc. (SHN) and the American Civil Liberties Union of Vermont. SHN provides information people with disabilities about sexual issues on its Web site, and the ACLU includes a link to SHN. Both argued that under the Vermont's law, they could be prosecuted. The District Court agreed and enjoined the law. The Second Circuit said the Vermont statute was overbroad and ran afoul of the U.S Supreme Court's precedent in Reno v. ACLU (521 U.S. 844, 849-53, 138 L. Ed. 2d 874, 117 S. Ct. 2329 [1997]). "Vermont's primary argument . . . is that the statute only applies to transmissions such as email sent directly to a minor when the sender has 'actual knowledge that the recipient is a minor. If that were the case, it is possible that regulation of such two-person email correspondence would be constitutional. However, as we have discussed, Vermont did not pass such a narrow statute. . . . [L]ike the statute struck down by the Supreme Court in Reno, [the Vermont law] regulates websites and internet discussion groups. See 521 U.S. at 859-60. Appellants have not challenged the district court's finding that the technology available to prevent minors from accessing websites and discussion groups has not developed significantly since the Supreme Court decided Reno and that the present technologies would deter many adults from visiting those sites," Judge John M. Walker Jr. wrote for the court. "We also agree with the district court that the legislative remedy is not narrowly tailored and that Vermont's goals could be substantially achieved through alternative means that would not burden adult expression. As the Reno Court found, the general interest in preventing minors from viewing pornographic material on the internet can be achieved through a variety of user-based internet filtering technologies that allow parents and teachers to oversee a minor's use of the internet," the panel said. Copyright 2003, LexisNexis, Division of Reed Elsevier Inc., All Rights Reserved This story and the complete archive of Mealey's Litigation Reports including related court documents are available online by subscription or on a pay-per-view basis. Go to Mealeys Online.
from MEALEY'S Cyber Tech & E-Commerce September 15, 2003 Virginia Federal Court Says Pop-Up Ads Didn't Infringe Copyrighted Ads ALEXANDRIA, Va. -- A company's pop-up advertisements that initially cover a competitor's online advertisements do not infringe copyrights or amount to unfair competition, a federal judge ruled Sept. 5 (U-Haul International, Inc. v. WhenU.com, Inc., et al., No. 02-1469-A, E.D. Va.; 2003 U.S. Dist. LEXIS 15710). (Opinion. Document #24-030915-103Z.) U-Haul Inc. sued WhenU.com after WhenU developed pop-up software that was downloaded knowingly or unknowingly by the end user. An unknowing download might occur when an end user downloaded a free screensaver but also received a program that causes pop-up advertisements to occur during Web searches. An end user without the pop-up software would go straight to the U-Haul Web site and encounter no pop-up ads. WhenU's software
caused its ads to crowd an end user's computer screen when end users
searched for do-it-yourself trucking or went to the U-Haul Web site,
in effect temporarily covering up ads and Web site display with pop-ads
from a competitor, WhenU.com. U.S. Judge Gerald Bruce Lee of the Eastern District of Virginia disagreed with U-Haul and granted summary judgment to the defendants. "Because the computer software at issue does not copy or use U-Haul's trademark or copyright material the Court concludes that WhenU's pop-up advertising does not constitute infringement or unfair competition," Judge Lee said. Copyright 2003, LexisNexis, Division of Reed Elsevier Inc., All Rights Reserved This story and the complete archive of Mealey's Litigation Reports including related court documents are available online by subscription or on a pay-per-view basis. Go to Mealeys Online.
______________________________________________________________ from MEALEY'S LITIGATION REPORT: Copyright November 3, 2003 3rd Circuit Affirms Webcasting Royalties PHILADELPHIA -- A rule issued by the U.S. Copyright Office requiring online streaming audio broadcasters to pay royalties is reasonable and subject to enforcement, the Third Circuit U.S. Court of Appeals held Oct. 17 (Bonneville International Corp., et al. v. Marybeth Peters, et al., No. 01-3720, 3rd Cir.). (Opinion. Document #16-031103-101Z.) U.S. Judge Berle M. Schiller of the Eastern District of Pennsylvania did not err in concluding that "streamcasters" are subject to the limited public performance right in sound recordings afforded to copyright holders under Section 106 of the Copyright Act, according to the unanimous three-judge appellate panel. AM/FM webcasting is not a nonsubscription broadcast transmission entitled to exemption, the court said. "The legislative history shows that DPRA [Digital Performance Right in Sound Recordings Act of 1995] created a nonsubscription broadcast transmission exemption for traditional over-the-air broadcasting in order to preserve the symbiotic relationship between broadcasters and the recording industry. And the DMCA [Digital Millennium Copyright Act]'s amendments were not intended to affect for nonsubscription broadcast transmissions. Therefore, the purpose of Congress was to limit the exception for nonsubscription broadcast transmissions to traditional, over-the-air broadcasts," the Third Circuit found. The rule, issued in December 2000 after the Recording Industry Association of America (RIAA) sought a clarification, provides that AM/FM broadcast signals transmitted simultaneously over a digital communications network, such as the Internet, do not enjoy the exemption from the Section 106 right that is applicable to "nonsubscription broadcasts" under Section 114(d)(1)(A). Also, the rule states that the Section 112 exemption for making ephemeral copies of recordings for the limited purpose of effecting a transmission does not apply to streaming audio broadcasts. Hundreds of AM and FM radio stations sued, seeking review of the rule and a declaration that Sections 112 and 114 are applicable to streamcasting. The Copyright Office and intervenor RIAA moved for summary judgment, seeking an order upholding the rule. Judge Schiller granted the defense motion and dismissed the action. (Broadcasters' brief. Document #16-031103-023B. RIAA brief. Document #16-031103-024B. Government brief. Document #16-031103-025B.) Copyright 2003, LexisNexis, Division of Reed Elsevier Inc., All Rights Reserved This story and the complete archive of Mealey's Litigation Reports including related court documents are available online by subscription or on a pay-per-view basis. Go to Mealeys Online.
from MEALEY'S LITIGATION REPORT: Copyright October 20, 2003 3rd Circuit Affirms That Web 'Streamcasters' Must Pay Royalties PHILADELPHIA -- A rule issued by the U.S. Copyright Office requiring online streaming audio broadcasters to pay royalties is reasonable and subject to enforcement, the Third Circuit U.S. Court of Appeals held Oct. 17 (Bonneville International Corp., et al. v. Marybeth Peters, et al., No. 01-3720, 3rd Cir.). (Opinion available. Document #16-031103-101Z.) U.S. Judge Berle M. Schiller of the Eastern District of Pennsylvania did not err in concluding that "streamcasters" are subject to the limited public performance right in sound recordings afforded to copyright holders under Section 106 of the Copyright Act, according to the unanimous three-judge appellate panel. Furthermore, defendant Marybeth Peters -- the register of copyrights -- was correct in interpreting the Digital Performance Right in Sound Recordings Act of 1995 and the Digital Millennium Copyright Act of 1998 as prohibitive of free online radio transmissions, the court said. "We find it perfectly reasonable to conclude that Congress was . . . anticipating that digital radio potentially could give rise to subscription radio services and chose expressly to distinguish such services from nonsubscription digital over-the-air radio services," the court said. The rule, issued in December 2000, provides that AM/FM broadcast signals transmitted simultaneously over a digital communications network, such as the Internet, do not enjoy the exemption from the Section 106 right that is applicable to "nonsubscription broadcasts" under Section 114(d)(1)(A). Also, the rule states that the Section 112 exemption for making ephemeral copies of recordings for the limited purpose of effecting a transmission does not apply to streaming audio broadcasts. Copyright 2003, LexisNexis, Division of Reed Elsevier Inc., All Rights Reserved This story and the complete archive of Mealey's Litigation Reports including related court documents are available online by subscription or on a pay-per-view basis. Go to Mealeys Online.
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