C & T Newsletters
December 2024
Authors Push OpenAI for Discovery on GPT Model Development in Copyright Lawsuit
Takeaway: Authors suing OpenAI for copyright infringement seek discovery on GPT models in development, highlighting growing tensions over AI’s use of protected works and the need for transparency in dataset practices.
A group of authors in a proposed class action suit, including notable figures like Sarah Silverman and Ta-Nehisi Coates, are suing OpenAI for alleged copyright infringement. In the suit, they are pressing for documents on OpenAI’s language models, including those still in development, claiming their copyrighted works were used without permission to train ChatGPT. OpenAI counters that such requests are irrelevant and overly burdensome, arguing future models were not trained on the plaintiffs’ works and proposing a declaration from an engineer to support this.
During a virtual hearing, Judge Robert Illman deemed the authors’ request reasonable but suggested narrowing their scope. The authors contend that information about OpenAI’s datasets and licensing practices is crucial, while OpenAI maintains that producing discovery for all models under development would be an enormous task.
The case focuses on allegations of direct copyright infringement, following prior rulings that dismissed an unfair competition claim. The lawsuit, consolidated with similar claims, highlights broader concerns over AI’s societal and intellectual property impacts. The judge instructed the authors to refine their discovery request and submit it alongside OpenAI’s engineer declaration for further consideration.
Federal Circuit Upholds $25K Sanction for Frivolous Stun Device Patent Suit
Takeaway: The Federal Circuit upheld a $25,000 sanction against PS Products for filing a frivolous patent lawsuit over a stun device, warning that courts can impose penalties to deter meritless litigation.
The Federal Circuit upheld a $25,000 sanction against PS Products (PSP) for filing a “nuisance” patent infringement lawsuit against Panther Trading Co. The panel affirmed a lower court’s decision, stating that the accused product was “plainly dissimilar” to PSP’s design patent for a stun device electrode, making the lawsuit frivolous.
PSP had initially sued Panther for design patent infringement but later dropped the case. Panther sought attorney fees and $100,000 in sanctions to deter similar meritless lawsuits. The district court awarded $43,000 in fees and costs, plus $25,000 in sanctions to discourage PSP from filing such cases in the future. PSP appealed the sanctions, arguing they were excessive, but the Federal Circuit confirmed the district court’s authority to impose both attorney fees and sanctions.
Panther’s attorney welcomed the decision as a precedent to deter frivolous patent suits aimed at extracting settlements. The ruling establishes clearer support for courts imposing sanctions alongside attorney fee awards.
California Court Orders TikTok to Provide Source Code in Trade Secrets Dispute
Takeaway: A California federal court has ordered TikTok to provide source code and financial data in a trade secrets case, highlighting the importance of protecting proprietary information and ensuring fair discovery in intellectual property disputes.
A California federal court has ordered TikTok to provide source code, financial, and data usage information to Beijing Meishe Network Technology, which alleges that a former employee unlawfully shared its proprietary source code with TikTok, enabling the platform to develop a video-editing feature. The court rejected TikTok’s objections to the discovery request, ruling that Meishe’s claims under the Defend Trade Secrets Act were plausible and could include conduct outside the United States. The order requires TikTok to submit this additional discovery within 30 days, with the possibility of extraterritorial damages still to be determined. The case centers around Meishe’s claim that TikTok misappropriated its trade secrets by using stolen code, and TikTok has argued that Meishe has not sufficiently identified the trade secrets it claims were misappropriated. However, the court emphasized that the requested discovery was necessary for Meishe to prove its allegations of trade secret theft and support its claims for damages.
USPTO Withdraws Controversial Double Patenting Proposal Amid Backlash
Takeaway: The USPTO withdrew a controversial proposal to expand terminal disclaimers, which limits the life of subsequent patents beyond an earlier issued related patent. The USPTO recited resource constraints, after strong opposition from former officials and concerns over its legality and impact on innovation.
The U.S. Patent and Trademark Office (USPTO) has withdrawn a controversial proposal regarding double patenting due to “resource constraints.” The proposed rule by Director Kathi Vidal sought to expand the impact of terminal disclaimers—stipulations that align the expiration of patents claiming the same invention. Vidal’s rule would have invalidated related patents if one patent was invalidated.
The proposal aimed to address “patent thickets,” particularly in the pharmaceutical industry, which critics argue block competition and inflate drug prices. Supporters included groups like Kaiser Permanente, the FTC, and nonprofit advocates for lower drug costs. Tech companies like Garmin also supported it as a tool against nonpracticing entities (patent trolls).
However, strong opposition emerged from former USPTO leaders, including David Kappos, Andrei Iancu, and Drew Hirshfeld, who argued the rule exceeded USPTO authority and could harm innovation. They claimed it was a “substantive” rule, making it illegal, and warned it would create confusion in patent law.
The Council for Innovation Promotion (C4IP), led by these former officials and judges, applauded the rule’s withdrawal, calling it a victory for inventors and American innovation.
Senators Introduce Bill to Shield Generics from Patent Infringement
Takeaway: A bipartisan Senate bill, the Skinny Labels, Big Savings Act, aims to protect generic-drug manufacturers from patent litigation over FDA-approved “skinny labels,” ensuring affordable generics can reach the market while bypassing patented uses of branded drugs.
A bipartisan group of senators has introduced the Skinny Labels, Big Savings Act to protect generic-drug and biosimilar manufacturers from patent infringement lawsuits when using FDA-approved “skinny labels,” which exclude patented uses of branded drugs. This bill addresses concerns that branded-drug companies are misusing patent litigation to block generic competition, particularly in cases where foundational patents have expired but newer patents for specific drug uses remain active. The bill aims to provide a legal safe harbor for generics, allowing them to market drugs for non-patented uses without the risk of infringement suits, ultimately promoting lower drug prices and increased access to affordable medications.
Pepsi Wins Trademark Battle Over ‘Mtn Dew Rise’ in Court
Takeaway: In the case of cola against coffee, PepsiCo’s “Mtn Dew Rise” energy drink dodged trademark trouble after a court ruled that Rise Brewing’s weak claim did not brew enough confusion to spill into trial.
The 2nd U.S. Circuit Court of Appeals upheld a ruling in favor of PepsiCo, finding that its “Mtn Dew Rise” energy drink did not infringe on the trademark of Rise Brewing, a canned coffee maker. The court sided with a lower court’s conclusion that the branding differences between the two products were more significant than any similarities and that Rise Brewing’s trademark rights were inherently weak due to the strong generic association of the term “Rise” with coffee. Rise Brewing, which sued Pepsi in 2021, argued that the “Mtn Dew Rise” name was intended to harm its business by flooding the market with a similar product, claiming it posed an existential threat. While a lower court initially granted Rise a temporary block on Pepsi’s use of the name, the appeals court later overturned that order in 2022. Following the appeals court’s earlier decision, the case was dismissed, with the judge ruling that the evidence did not support a likelihood of consumer confusion or merit taking the case to trial.
Cislo & Thomas LLP Spotlight
Cislo & Thomas LLP Celebrates the Holiday Season
Cislo & Thomas celebrated the end of 2024 with a festive holiday luncheon at San Antonio Winery, whom we proudly represent. It was a wonderful time of enjoying each others’ company over a delicious meal. To another great year ahead!
Cislo & Thomas LLP: Billing Update
At Cislo & Thomas LLP, we continuously strive to provide the best legal counsel and Quality Client Care® to all of our clients. We take pride in helping your business achieve its intellectual property goals.
As we enter 2025, we are notifying all clients of Cislo & Thomas LLP of recent updates to our firm’s billing rates. The firm rates will be increasing by up to 8% in 2025 to accommodate for inflation and USPTO rate changes.
If you have any questions, please call our billing department at: (310) 979-9190 Extension 242.
Previous Newsletters
