Intellectual Property Alert: 2017’s Five Top Intellectual Property Issues
December 8, 2016
In today’s fast-paced business environment, the protection of intellectual property can be overlooked. But it remains important for businesses, perhaps more so than ever. Which intellectual property issues will have the greatest impact in 2017? Roberta Jacobs-Meadway, co-chair of Eckert Seamans’ intellectual property group, identifies five intellectual property issues worth watching in the coming year.
- The “Slants” case – Registration/protection of disparaging marks
The Supreme Court of the United States has agreed to review In Re Tam, in which Simon Tam appealed the denial of trademark registration for the name of his band, The Slants, on the grounds that it is a disparaging name. If SCOTUS finds the ban on registration of marks disparaging to groups to be unconstitutional, it would raise, if not resolve, the issue of whether such marks can be protected against infringement, and it would also impact both the case of Pro-Football v Blackhorse concerning the Redskins team name and the prohibition on protection of vulgar marks. It might also lead to questioning of the dilution provision of 43(c) of the Lanham Act to the extent it bars use and registration of terms found to be dilutive by tarnishment irrespective of likelihood of confusion.
The advantages of registration are significant for businesses, which would benefit from the elimination of the selective denial by the government of registration for certain communications based entirely on their content, irrespective of context.
- The “Alice” standard – Protecting business methods and software
In 2014, SCOTUS delivered a unanimous decision in Alice Corporation v CLS Bank International, which determined that abstract ideas are not eligible for patent protection. While this year’s Enfish LLC v Microsoft Corp, et al, and Intellectual Ventures v Trend Micro decisions may offer some clarity, patents for business methods and software continue to fall as the courts grapple with the Alice standard for what is a patentable invention. The question is whether a clearer test can and will be devised, and if so, by whom.
If the concurring opinion holds sway, there is no need for a test because there are no valid software patents at all. The First Amendment argument used in Intellectual Ventures is a new one in this context, and it is the sort of argument that could get traction for review by SCOTUS.
- The “Halo” case – Damage and fee awards in intellectual property cases
When SCOTUS overturned the Federal Circuit decision in Halo Electronics, Inc., v Pulse Electronics, Inc., in June 2016, they made it somewhat easier to make a case for enhanced damages and rejected the idea that patent litigation should have different rules for punitive damages from other civil cases.
In the coming year, the impact of this decision will begin to shape legal approaches and results. What makes a case exceptional and how that might influence outcomes given the greater discretionary role for judges and juries remains to be seen.
- The Flanax case – Extraterritorial extension of trademark and likelihood of confusion
In the latest chapter of the long-running Belmora vs Bayer case involving the name of the painkiller Flanax, Belmora has filed for a writ of certiori with SCOTUS, questioning whether the owner of a well-known foreign trademark that hasn’t been registered or used in the U.S. can claim priority over a registered U.S. trademark.
Previously, trademark rights were considered to be territorial. Exceptions were made for famous marks or where there was cross-border activity or promotion in some circumstances. With commerce becoming ever more global, one important question is how much the exceptions will expand to protect the rights of U.S. entities doing business outside the US (and vice versa).
- Legalized cannabis – Protection of names and marks for controlled substances
Eight states have legalized recreational marijuana, while a total of 25 (and the District of Columbia) have legalized medical use. However, being legal at the state level doesn’t mean sale, use or possession are legal at the federal level and this has implications for trademark protection of companies in the business of selling marijuana and related products. Although it is possible to register trademarks at the state level, the USPTO will not register marks for cannabis products, since marijuana sales are not lawful in interstate commerce.
There are related issues involving controlled substances that are legal at the federal level, such as alcoholic beverages. But it remains to be seen how trademark protection for beer, wine and distilled spirits, especially those made by small craft breweries, wineries and distillers that do not have broad interstate distribution, can provide a model for the legalized cannabis industry.