C & T Newsletters
November 2024
Court Ruling Favors OpenAI: Copyright Claims Against AI Models Face Legal Hurdles
Takeaway: A copyright lawsuit against OpenAI was dismissed as the court ruled that large language models synthesize knowledge rather than copy content, making it nearly impossible to prove concrete harm under current copyright laws.
A recent copyright lawsuit between Raw Story Media and AlterNet Media against OpenAI resulted in a decisive victory for the AI company, setting a precedent for how copyright claims against large language models (LLMs) might be addressed in the future. The plaintiffs accused OpenAI of using their copyrighted content without permission to train ChatGPT and sought damages and injunctive relief. However, the court dismissed the case, citing a lack of concrete harm, as the plaintiffs could not prove that ChatGPT reproduced their specific content or that future violations were likely. The judge underscored that the vast datasets used in training LLMs make it nearly impossible to attribute outputs to any single source, and that models synthesize knowledge from many inputs rather than copying verbatim.
This outcome highlights the complex legal and technical challenges in applying traditional copyright law to AI. The court acknowledged that OpenAI uses copyrighted material and suggested that new statutes might be needed to address potential harms. Critics argue that AI companies should compensate content creators, but the nature of LLMs complicates such claims: they generalize knowledge across billions of sources and are designed to avoid direct replication. While some suggest banning AI models from using copyrighted content or enforcing source attribution through web APIs, others warn these measures could stifle AI development. The debate underscores the tension between protecting intellectual property and fostering technological progress, leaving courts and policymakers to navigate this uncharted terrain.
Judge Orders Oakland Airport to Drop “San Francisco Bay” from Name Over Trademark Dispute
Takeaway: A federal judge ruled that Oakland’s airport must stop using “San Francisco Bay” in its name, citing trademark infringement and potential traveler confusion with San Francisco International Airport, even though the mark is descriptive.
A federal magistrate judge in California ruled that Oakland’s airport must stop using “San Francisco Bay” in its new name, citing potential trademark infringement and consumer confusion. San Francisco sued the Port of Oakland, alleging that renaming the Oakland International Airport as “San Francisco Bay Oakland International Airport” infringed on San Francisco International Airport’s (SFO) trademark and could mislead travelers into believing the two airports are affiliated.
Judge Thomas S. Hixson granted a preliminary injunction in favor of San Francisco, emphasizing the strength of SFO’s trademark and the likelihood of confusion caused by Oakland’s use of “San Francisco” in its name. The judge noted that the name implies a connection between the two airports, which could harm SFO’s brand and goodwill.
The Port of Oakland argued that the name change would not confuse travelers and claimed SFO’s trademark was weak. However, Judge Hixson rejected this, citing SFO’s longstanding trademark and widespread recognition. He added that U.S. airports rarely include another city’s name unless they are affiliated, further bolstering San Francisco’s case.
The ruling temporarily blocks Oakland’s airport from using its new name and allows the case to proceed toward trial. San Francisco’s representatives expressed satisfaction with the decision, while Oakland is reviewing its options.
USPTO Implements Revised Patent Fee Hikes Starting January 2025
Takeaway: The USPTO announced patent fee hikes effective January 2025, revising some controversial increases while maintaining others to cover rising costs, enhance operations, and sustain financial stability. In light of the impending fee increases, you may want to initiate or authorize any pending work now before January 19, 2025.
The U.S. Patent and Trademark Office (USPTO) has announced a significant overhaul of patent-related fees, set to take effect on January 19, 2025. This adjustment includes 433 fee changes, with 52 new fees introduced to offset rising operational costs due to inflation, higher examiner salaries, and discounts mandated by a 2022 law for small-entity applicants. While some proposed fee increases, such as a 5% hike for most patent-related costs, faced public criticism, the USPTO revised them in the final rule. Filing, search, and examination fees will increase by 2.5%, and other patent fees by 7.5%, cumulatively amounting to a 10% revenue boost. The agency asserts that these changes will support improvements in patent quality, reduce pendency, and modernize IT infrastructure. Notable adjustments include reductions in proposed fees for patent term extensions and terminal disclaimers, aiming to balance cost recovery with stakeholder concerns.
Several fees for processes like continuing applications, inter partes reviews, and design patent filings were recalibrated, while others remained aligned with earlier proposals. For instance, fees for filing design patents will rise by 48%, justified by the USPTO’s substantive examination process. Adjustments were also made to address criticism that some increases would disproportionately burden applicants, such as the scaling back of costs for subsequent Requests for Continued Examination. Despite public objections, the USPTO maintains that its fee structure reflects operational costs and ensures financial stability. The announcement follows a history of fee-setting authority granted to the USPTO under the America Invents Act, with the current authority expiring in 2026 unless renewed by Congress. The agency emphasized that stakeholder feedback influenced revisions to its final rule, showcasing a balance between cost recovery and innovation encouragement
Amazon Brand Registry Update: Faster Access with Pending Trademarks, But Potential Risks
Takeaway: Amazon has updated its Brand Registry program to allow sellers to access it with pending trademark applications, significantly reducing wait times and bypassing the need for a fully registered trademark, though this change raises concerns about potential abuse.
Amazon Brand Registry is a program designed to help sellers protect their brands on Amazon by granting access to tools for removing counterfeiters, “listing hijackers,” and trademark infringements. Initially, sellers needed a fully registered trademark, requiring an 8-12 month wait in the United States. However, recent updates to Amazon’s policy have made the process faster and more accessible by allowing pending trademark applications to qualify for Brand Registry. Sellers now often gain access within a week of filing their trademark applications with the USPTO. This change has led to a 99% success rate for applicants, making it easier for businesses to protect their brand and connect with customers without enduring lengthy delays.
The updated policy applies globally and has rendered Amazon’s IP Accelerator program less essential, as the primary benefit of immediate access is now standard. While this shift is a boon for sellers, it raises concerns about potential abuse, as Amazon currently lacks a system to monitor rejected or frivolous trademark applications. Despite these risks, the faster process benefits sellers who need immediate action against counterfeiters and listing hijackers, providing much-needed flexibility and efficiency for businesses navigating the competitive Amazon marketplace.
Anticipated Shifts in Intellectual Property Policy Under a Second Trump Administration
Takeaway: Experts predict that a second Trump administration will likely prioritize pro-innovation IP policies, strengthen patent protections, deregulate AI, and focus on global trade relations, with key leadership appointments shaping the direction of IP law.
The potential intellectual property (IP) landscape under a second Trump administration is still uncertain, but experts suggest several key shifts may occur. Many predict a return to a more pro-innovation stance, particularly in areas like antitrust and patent policy. A reemphasis on the “New Madison Approach,” which prioritizes strong property rights and the protection of standard essential patents (SEPs), is anticipated. This could involve a more permissive stance on patent licensing and a rejection of the Biden administration’s more restrictive IP policies. Other expected changes include support for patent reform legislation, stronger IP protections internationally, and opposition to measures like the TRIPS waivers and price regulations on pharmaceutical patents.
In addition to these policy shifts, there is speculation about personnel changes and leadership appointments that may influence the direction of IP policy. Key positions, such as the Director of the U.S. Patent and Trademark Office (USPTO), are seen as pivotal in shaping the future of patents and innovation in the U.S. While some experts anticipate a focus on deregulation in areas like artificial intelligence (AI), others emphasize the need for a director who understands the value of patents as an incentive for technology investments. Moreover, Trump’s historical stance on trade, particularly with China, is expected to influence global IP practices, although experts acknowledge the potential for increased fragmentation between East and West on trade policies.
Tesla Nears Settlement in Trade Secret Lawsuit Against Rivian
Takeaway: Tesla has reached a conditional settlement in its lawsuit against Rivian, which alleged that Rivian recruited Tesla employees who took confidential information to help develop its electric truck with the case set to be dismissed by December 24.
Tesla has reached a conditional settlement in its lawsuit against Rivian Automotive, which accused the electric vehicle startup of recruiting Tesla employees who allegedly took confidential information to Rivian. Tesla claimed that Rivian intentionally recruited Tesla workers to gain access to trade secrets, including details on salary, equity, and bonus structures, as well as sensitive manufacturing data.
Tesla filed the original lawsuit in July 2020, alleging that Rivian’s recruitment efforts led to the theft of trade secrets, which helped Rivian speed up the development of its electric truck, the R1T, released in 2021. Tesla argued that Rivian directed employees to take proprietary information and that Rivian’s internal investigations into the alleged theft were inadequate. Rivian countered that it did not encourage employees to bring Tesla’s secrets and that it had disciplined some workers after an investigation.
After years of litigation, including a failed bid by Rivian for summary judgment, Tesla and Rivian have now agreed to settle, with a dismissal of the case expected by December 24. The specific terms of the settlement have not been disclosed. The settlement brings the legal battle closer to resolution after more than four years of legal proceedings.
Samsung Ordered to Pay $118 Million in Patent Infringement Lawsuit with Netlist
Takeaway: A federal jury awarded Netlist $118 million in damages from Samsung for patent infringement related to memory technology, following previous verdicts against Samsung and Micron, with the potential for increased damages due to willful infringement.
A federal jury in Marshall, Texas awarded $118 million in damages to Netlist, a computer memory company, in a patent infringement lawsuit against Samsung Electronics. The case revolves around technology designed to improve data processing in high-performance memory products. This verdict follows a $303 million ruling against Samsung in a related case last year, and Netlist also won $445 million from Micron in May over similar patents.
Netlist accused Samsung of infringing its patents related to memory modules used in cloud servers and data-intensive technology, claiming these innovations enhance power efficiency and speed in data processing. Samsung denied the allegations, arguing the patents were invalid and its technology was different.
The jury found that Samsung’s infringement was willful, which could lead to the damages being tripled. Additionally, Samsung filed a separate lawsuit accusing Netlist of failing to offer fair licenses for technology tied to international standards.
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