Weekly IP Takeaways

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

1. A recent trademark decision from the Northern District of California resulted in denial of a motion for preliminary injunction where the defendant was not shown to be using the allegedly infringing/counterfeit mark as a trademark. Two competing companies that have apps pairing freelance workers with job opportunities use the term FREELANCER for their products. The defendant asserted that its use of FREELANCER was not a trademark use, or was a fair use. The Court was unpersuaded that the defendant was using FREELANCER as a trademark because the defendant used the word in conjunction with its own logo and registered trademark UPWORK (which were used in association with FREELANCER), it did not list FREELANCER as one of its own trademarks, it did not use “TM” in association with FREELANCER, and it did not use a stylized font to highlight FREELANCER in its use of the term. Thus, Plaintiff’s motion for preliminary injunction was denied. The takeaway here is that some uses of terms may not constitute a trademark use, and if clients want to use a trademarked term in a descriptive, good faith manner, it should avoid calling out the trademarked term as a trademark.

2. A recent decision by the Trademark Trial and Appeal Board (TTAB) affirmed a refusal to register the mark TEXAS LOVE in class 25 for hats and shirts. The TTAB determined TEXAS LOVE to be a widely used phrase or message by numerous third parties such that consumers would not perceive it to be acting as a source identifier for the Applicant. The TTAB did not want to give anyone the ability to tie up the phrase and prevent others from using it. The Applicant presented an interesting equal protection argument based on the approval by the USPTO of FLORIDA LOVE and CALIFORNIA LOVE marks. The TTAB rejected the argument because the Applicant presented no evidence that the USPTO was treating Texas residents differently than those in other states. The takeaway here is to note that registering a phrase or slogan may be difficult if the phrase is not acting as a source identifier (i.e., as a trademark). Perhaps, after extended use of a phrase such as TEXAS LOVE, an Applicant can present an acquired distinctiveness argument to the USPTO.

3. A recent decision by Judge John A. Kronstadt in the Central District of California (C.D. Cal. Case No. 16-6554) awarded attorneys’ fees to a prevailing party, including fees incurred in an inter partes review (IPR) in the Patent Trial and Appeal Board (PTAB), a Federal Circuit appeal, as well as the district court. Judge Kronstadt determined that the Court could award exceptional case attorneys’ fees incurred in an IPR related to the district court case, as well as in an appeal of the IPR to the Federal Circuit. This is an interesting determination in that the Federal Circuit has previously expressed some reticence, or even statutory inability, to award fees in a litigation where those fees were incurred in an IPR. I previously blogged about a Federal Circuit decision (Takeaway No. 2) vacating a district court decision that a result in an IPR that resulted in a dismissal of district court litigation could not support an exceptional case fee award. I also previously blogged about a motion decision by the Federal Circuit (Takeaway No. 2) denying a fee award in litigation for fees incurred in an IPR. The decision in this case is somewhat unique in that the defendant argued there were deficiencies in service of the district court complaint, yet the patent owner argued that the IPR petition was filed too late and was time-barred. After the IPR petition was filed, the district court case was stayed. The PTAB instituted the IPR and ordered briefing about whether or not service was proper. The PTAB found the IPR was not time-barred (because of deficiencies in the service of the district court complaint) and issued a final written decision invalidating the challenged claims. The patent owner then appealed the IPR decision to the Federal Circuit, and the Federal Circuit issued an opinion affirming the failure of service and invalidity. Thereafter, the case returned to the district court, which lifted the stay and entered judgment. Thereafter, the defendant filed its fee motion. The Court determined that the case was exceptional because the deficiencies in service were clear, and the patent owner continued to press thin and ever-changing arguments about service. The fee award was largely targeted to the patent owner’s litigation of the service issue in the district court, the PTAB, and the Federal Circuit. The takeaway here, and what may be a trend for a more liberal view of fee awards in district courts for actions taken in other venues, is for litigants in appropriate situations to seek to recover fees incurred in other venues connected to the main case, but to do so in a manner that is targeted to the alleged misconduct. One would surmise that this order will be appealed to the Federal Circuit, which really needs to speak with a clear voice as to whether courts are authorized to award fees incurred in PTAB proceedings.