Weekly IP Takeaways

Prepared by Cislo & Thomas LLP Attorney Mark D. Nielsen, Ph.D.

1. In what is often a “gray area” issue in trademark and unfair competition litigation, the Fourth Circuit Court of Appeals recently issued an opinion concerning whether laches or a statute of limitations applies to Lanham Act claims. Leaving the long and winding history of this matter aside, defendant drug company sought to register a trademark for, and sell, a pain reliever under the name FLANAX. Bayer owns the rights to FLANAX in Mexico among other places, but sells the same pain reliever in the U.S. under the name ALEVE. The defendant secured a trademark registration, which was subsequently canceled by Bayer. Bayer then sued the defendant drug company for Lanham Act violations, and unfair competition under state law. The defendant had also filed a proceeding challenging the cancellation of its trademark registration. The cases were consolidated, and one of the issues presented to the district court, and ultimately appealed to the Fourth Circuit is whether laches or a statute of limitations controls the time for bringing claims under the Lanham Act. Typically, courts have applied the statute of limitations from the most analogous state law claims, if available. The Fourth Circuit, however, rejected that approach, holding that laches is the proper timeliness mechanism to apply to Lanham Act claims. The Fourth Circuit held this, in part, because the Lanham Act does not have an express limitations period, and it is generally equitable in nature, which makes laches more appropriate for Lanham Act claims. The takeaway here is to know the law of the circuit in which you are planning to file in terms of whether the courts will borrow analogous statutes of limitations from other claims, or use laches.

2. In a recent opinion from the Ninth Circuit Court of Appeals, the Court held that where defendants are joined in a copyright infringement case and alleged to be jointly liable, the Copyright Act permits only one statutory damages award against the group of jointly liable infringers. This holding provoked a vigorous dissent from Circuit Judge Wardlaw who not only found the majority’s holding unnecessary where the defendants were not expressly found by the jury to be jointly liable (but where the pretrial order may have suggested otherwise), but also raised concerns about whether the majority’s holding would lead to a dramatic increase in case filings because plaintiffs will refrain from joining defendants in a single case. The takeaway here is that this may be an arrow in the quiver of defendants alleged to be jointly liable in copyright cases, and it may lead to an increase in case filings as argued by Judge Wardlaw so that plaintiffs can attempt to maximize statutory damages against multiple defendants in separate cases.

3. Following up on several previous posts here (Takeaway No. 1) and here (Takeaway No. 2), the parties to the case involving a news website’s unauthorized use via embedding of a photograph posted on Instagram by the photographer have now settled their dispute on non-public terms. The takeaway from the case is that publishers should seek permission before embedding photographs taken by others.