Prepared by Cislo & Thomas LLP Attorney Mark D. Nielsen, Ph.D.
1. First, in what may be a bit of old news by now, three judges for the Central District of California were recently confirmed. The Central District is one of the busiest IP courts in the country, if not the busiest. So, having three new judges on the Court is a good thing. The Central District news releases are here.
2. In a recent opinion from the Ninth Circuit in a trademark/counterfeiting case concerning skin care products, the Ninth Circuit held that a likelihood of confusion is required for claims of counterfeit marks. The Court affirmed that the defendant’s product bearing the same “EYE DEW” mark on it as the plaintiff’s mark was not a counterfeit because there was no likelihood of confusion. On appeal, the plaintiff argued that a likelihood of confusion is not required for counterfeiting claims. The Ninth Circuit rejected this argument based on the language of the Lanham Act itself, and also noting the same position being taken by the Second and Fifth Circuits. The plaintiff also argued that a likelihood of confusion should be presumed because the marks (“EYE DEW”) were the same. The Ninth Circuit also rejected this argument because the marks as a whole, as they are presented in the marketplace, had a number of differences in appearance such that no customer would be likely to be confused. Finally, because the registered mark was a standard character word mark, the plaintiff argued that considering the product as a whole was incorrect. The Court also rejected this argument. Thus, summary judgment for defendants was affirmed. The takeaway here is that one must at least consider the marks as they are presented in the marketplace, not just the marks themselves. In addition, one must consider as many of the Sleekcraft factors as may be applicable before asserting a Lanham Act claim.
3. In a novel setting because of COVID, a 20+ day bench trial over Zoom between Centripetal Networks and Cisco resulted in a 178 page judgment and a $1.9 billion damages award against Cisco. The judgment appears to be the second largest in a patent case in the U.S. Following the Court’s findings of infringement of all but one patent, and validity of the infringed patents, the damages were calculated based on a 10% royalty against gross revenues and a 2.5-fold increase for willful infringement. The facts supporting willful infringement included the plaintiff’s presentation of its technology to Cisco for a possible sale or license, Cisco turning down the proposal, and then coming out with the infringing technology shortly thereafter. In addition to past damages, the Court denied injunctive relief, but ordered a running royalty for six years. Undoubtedly, this judgment will be appealed by Cisco, which maintains that the patents were not infringed and/or were invalid.
