flag.jpgSan Diego – A recent study by the United States International Trade Commission has revealed that intellectual property infringement by China is costing the U.S. more than one million jobs.  Despite stricter Chinese laws in the areas of trademarks, copyrights, and patents, China continues  to be a haven for counterfeiters and pirates.

The Trade Commission study surveyed U.S. businesses and found that an estimated $48 billion in revenue was lost in 2009 due to intellectual property violations from China.  An even higher estimate was realized when the commission used a statistical model rather than the survey model, with findings that up to 2.1 million U.S. jobs could be supported if China were to substantially increase its intellectual property enforcement.

According to Max Baucus, the chairman of the Senate Finance Committee that requested the study, “We cannot pretend that there aren’t real consequences to these violations when these numbers show that millions of American jobs are on the line.”  He added that he hoped that a recent meeting with Chinese government officials would help “break down trade barriers and make it cheaper, faster and easier for U.S. small businesses to export to these lucrative markets.”

The United States is not the only country to suffer from China’s ongoing intellectual property infringement.  An recent study out of Beijing found that software piracy cost the domestic industry 130.9 billion Yuan ($20.1 billion) in 2010.

troll.jpgLos Angeles – Buzzfeed, a website that combines a technology platform for detecting viral content with an editorial selection process to provide a snapshot of “the viral web in real time”, filed a class action counterclaim against Righthaven, LLC in an ongoing copyright infringement lawsuit.  In the class action suit, Buzzfeed is seeking to represent defendants who have been sued by Righthaven in the state of Colorado.

Righthaven is an entity that has acquired rights to infringed upon copyrights in order to file lawsuits seeking monetary payments – otherwise referred to as a copyright troll.  Buzzfeed claims that Righthaven has failed to issue the defendants take down notices prior to suing, threatened to seize the defendants’ domain names when it was not provided for under the federal Copyright Act, falsely claimed to own the copyrights at issue, and failed to use fair business practices before suing.  The claim seeks a judicial decision to determine that Righthaven’s copyright infringement lawsuits are unfair and deceptive under Colorado law, an injunction permanently enjoining Righthaven from continuing the alleged unfair and deceptive trade practices, monetary damages to the plaintiffs as well as their attorneys’ fees.

“As a result of Righthaven’s unlawful actions, class plaintiffs and members of the proposed class were forced either to fight needless litigation or to pay Righthaven a settlement fee, which they would not have had to pay, had Righthaven engaged in legitimate business practices,” as stated in the counterclaim.  Buzzfeed’s counterclaim is at least the eighth filed against Righthaven, in which it already lost two Nevada cases on fair use rulings.

The counterclaim comes in response to Righthaven’s March 30, 2011 copyright infringement claim against Buzzfeed over the use of a Denver Post TSA pat down photo.  Buzzfeed insists that it and other websites used the photo legally because they were granted a license by the Denver Post to use the photo through “links and features encouraging the sharing of the work.”

No comment was available from Righthaven on the counterclaim.

dollar-money-symbols.jpgSan Diego – Global software giant SAP America and its German-based parent company, SAP AG, were ordered by a judge to pay Versata Software and Versata Development Group $345 million in damages for a patent infringement.

In August 2009, Versata, which develops enterprise software applications for automating and streamlining critical business processes, won a judgement in the amount of $138.6 million from SAP in the U.S. District Court for the Eastern District of Texas.  The verdict was set aside and the judge ordered a new trial for damages but upheld SAP’s patent infringement.  The verdict issued in the new trial which lasted one week awarded Versata $260 million in lost profits and $85 million in reasonable royalties.

The infringement at issue involves a patent held by Versata for pricing technology.  In the most recent trial, the jury found that SAP’s products, which were redesigned in May 2010, continue to infringe on Versata’s U.S. Patent No. 6,553,350 B2, issued in 2003.  Versata’s patented technology dramatically changed front office enterprise software by permitting complex pricing to be processed faster and more efficiently.  Versata COO, Chris Smith, stated, “Our patented technology enables Versata customers to deploy best-in-class solutions that competitors simply cannot match.  We cherish and defend the mutually successful, multi-decade relationships resulting from our innovation investment.”

The Versata verdict comes as another setback after a jury in California ruled that SAP was guilty of corporate theft and ordered it to pay Oracle $1.3 billion in damages.  The issue in that particular case centered on illegal files downloaded by a former SAP subsidiary, TomorrowNow, which provided lower-cost support for Oracle software.  TomorrowNow has since ceased operations.

A spokesperson for SAP AG said that the company will likely appeal the verdict.

USPTO Image.jpgLos Angeles – The United States Patent and Trademark Office (“USPTO”) recently unveiled its Trademarks Dashboard feature which provides a summary of expected time to examine trademarks and other trademark office statistics such as total trademark filings by year. 

The statistics show that currently trademark applications are being assigned to examiners and reviewed in a little less three months which is within the stated goal of between 2.5 and 3.5 months.  This rate is considerably better than a few years ago when the delay reached 7 months.  The overall number of trademark applications filed are on the rise over the last two years with 189,064 applications filed year to date.  The increase is one indicator that the U.S. is slowly crawling out of the recession mired years of 2009 and 2010.  The trademark dashboard states that it is on pace for a total of 385,000 trademark applications to be filed this year which would be an improvement over the 2009 and 2010 numbers but would fall slightly short of the 401,392 trademark applications filed in 2008.

The dashboard also shows that, as of the end of the second quarter, the total number of active trademark registrations stands at 1,655,542 which is about 200,000 more than the total active registrations at the end of the third quarter in 2008.   The statistics also show that nearly all applications are now filed electronically compared to a few years ago when nearly all applications where paper-filed.  Of the 189,064 applications filed in the second quarter, a mere 2,629 were paper-filed.  For the first time in 2011, now more than 70% of all applications are completely processed online.

medical-monitor.jpgSan Diego – A jury recently awarded Boston Scientific $19.5 million in a patent infringement case over a heart stent.  The decision, handed down by the U.S. District Court in Delaware, ruled that Cordis Corp was indeed guilty of patent infringement and owes Boston Scientific $18.5 million for lost profits and $1 million in royalties for the infringement of its Jang patent.  Boston Scientific manufactures coronary stents to repair clogged arteries.

Cordis, the stent-making subsidiary of Johnson & Johnson, was sued by Boston Scientific in December 2009 after the launch of Cordis’ 2.25 mm Cypher Stent.  On April 13, 2011, the Delaware Court ruled that Cordis had infringed on Boston Scientific’s Jang patent, which covers  coronary stent technologies.  Hank Kucheman, Boston Scientific executive vice president, said that the verdict is crucial in protecting the company’s market position in small-vessel drug-eluting stents against infringement.

This is not the first time the two companies have battled each other in court.  In 2003, J&J made a claim that Boston Scientific’s Express, TAXUS Express, and Liberte stents infringed on its Palmaz and Gray patents.  Another dispute between the two companies involved a complaint made by Boston Scientific alledging that J&J’s Cypher, BX Velocity, and Genesis stents infringed on its Jang patent.  In 2005, the two matters went to trial and both companies were found guilty of infringing on each other’s patents.  Those findings were upheld on appeal.

In a statement made by Ray Elliott, the president and CEO of Boston Scientific, he said, “In the past year, we have significantly reduced the volume of outstanding litigation, having now settled 17 lawsuits with Johnson & Johnson, as well as disputes with other competitors and the government.”  In an emailed statement from Sandy Pound, a Cordis spokesperson, she said, “Cordis is considering what, if any, next steps it may take in the legal process.”

The battles between Boston Scientific and J&J aren’t surprising considering the highly competitive and very crowded patent field related to stents.

basketball.jpgLos Angeles – The NCAA is finally the exclusive owner of the now famous March Madness trademark.  March Madness refers to the annual college basketball tournament which ultimately crowns college basketball’s national champion.

The March Madness term was first used in a 1939 magazine article by Henry V. Porter, an executive secretary for the Illinois High School Association, to describe the Illinois state basketball championship.  By the 1980s, the term was used by Intersport CEO Charles Besser for the title of a TV show he produced about the NCAA tournament.  In March of 1989, Besser filed a MARCH MADNESS U.S. Trademark Application for “entertainment services, namely, presentation of athletic and entertainment personalities in a panel forum.”  Thereafter years of disputes waged on between Intersport and the NCAA over rights to the trademark.

Finally last October, the NCAA reportedly paid $17.2 million to Intersport to stop all use of the term which has also been used by the NCAA’s men’s basketball tournament since the 1980s.  The settlement gives the NCAA sole ownership of the trademark for the first time.  For a time Intersport, the NCAA, and the Illinois High School Association were all using the trademark but the Illinois High School Association since became a licensee of the NCAA for use of the term in connection with high school basketball.

As a result of the settlement, the NCAA will now have an enhanced ability to police the trademark by telling others to cease use.  As such, the trademark is much more valuable.  Considering the ever-increasing value of the March Madness tournament television rights fees, the settlement appears to be a win-win for both Intersport and the NCAA.

football.jpgSan Diego – In a domain name dispute between the Cleveland Browns and an alleged cyber-squatter, the World Intellectual Property Organization (“WIPO”) ordered that the domain name Browns.com be transferred from an Andrea Denise Dinoia to the Cleveland Browns.

The team filed a complaint in March alleging long standing rights to the CLEVELAND BROWNS and BROWNS trademarks and that the use of the Browns.com domain name by defendant was confusing the public.  Perhaps not surprisingly, Ms. Diniola, who is a resident of Pineta, Italy, did not respond to the complaint.  Prior to Ms. Dinoia, the domain name was registered to Gioaccino Zerbo who was using it to sell NFL merchandise.  That was definitely an unwise move and pretty much sealed the fate of the domain name.  Had the registrants used the domain name for a website related to the color brown, or had they not hosted a website there at all, they likely would have been able to retain ownership.

The team has not yet taken control of the domain name as the current www.browns.com website remains a one page site in Italian.  In addition to finding that the respondents had no legitimate rights or interest in the domain name and that confusion among consumers was likely, WIPO held that the timing of the transfer of the domain name from Zerbo to Diniola was evidence of bad faith due to the impending legal action. 

Even with the NFL strike in full swing, and the preseason not yet here, the Browns still found a way to get a win.

movie-film-cannister.jpgLos Angeles – In the largest Internet copyright infringement case in United States history, a federal judge is permitting the U.S. Copyright Group (USCG) to subpoena Internet service providers for the identities of 23,000 file sharers who illegally downloaded the film “The Expendables.”  The USCG is a plaintiff’s organization which brings together independent film companies to engage in protecting their copyrighted materials by suing people in the U.S. who have allegedly used the P2P file sharing networks to illegally download movies.

The order to allow the subpoenas was issued on March 17th by U.S. District Judge Robert L. Wilkins.  As a result of the order, the thousands of people who chose to illegally download the movie will have to decide whether to shell out thousands of dollars to settle with USCG or to face possible damages of up to $150,000 per infringement.  The USCG uses custom software to monitor bit torrent swarms of selected movies and then records the IP addresses of the file sharers.  With the recent order from the court, the USCG will be able to force the ISP’s to release the identities of the file-sharers.  The file-sharers will then receive a letter from the USCG with the threat of a lawsuit or the option to settle up for anywhere between $1000-$3000. 

The USCG was formed in early 2010 and in its first year had filed copyright infringement claims against 16,000 people.  The group has received major pushback from the EFF, the ACLU, and Time Warner Cable.  The USCG faced legal troubles of its own when it was sued in November 2010 for allegedly engaging in fraud and extortion by offering settlements without full intent to sue and for having falsified a movie’s date of first publication.

chalkboard2.jpgSan Diego – A California federal judge has thrown out a trademark infringement case filed by social networking site Facebook against Teachbook.com because the alleged infringement did not occur in California.  Teachbook.com, an online community for school teachers, does not accept users from California and therefore does no business in the state. 

Facebook’s complaint accuses Teachbook.com of violating its trademark rights and demanded that the Teachbook site remove the “book” suffix from its name.  The social networking giant accused Teachbook.com of “intentionally adopting an infringing trademark for use on social networking services that directly compete with Facebook.” 

Teachbook responded to the August 2010 complaint with a motion to dismiss or request that the case be moved to an Illinois court, near its home office.  The general rule in litigation is that a plaintiff must sue a defendant where the defendant resides.  Facebook, a Palo Alto, Ca-based company, believes that it is reasonable for the case to be heard in California despite the general rule because that is where it suffered the injuries from the alleged infringement.  Luckily for Teachbook.com, U.S. District Judge Ron Whyte didn’t agree with Facebook’s reasoning.  The judge insisted that Teachbook.com went out of its way to avoid doing business in California and went as far as banning any California residents from joining its site.  Teachbook claims that its reason for not doing business in California was to avoid the state’s strict anti-SPAM laws, which was enough evidence for the judge to dismiss the case.

Interestingly enough, if the case had been heard in California, it appears that the judge believed that Facebook could prove a likelihood of confusion between the two trademarks.   In statements from the dismissal, the judge wrote, “Teachbook, somewhat implausibly, insists that it did not intend to trade on Facebook’s mark, and that it selected the TEACHBOOK mark in 2009 because of the connection between teachers and books.”  The judge also wrote that Facebook had initially showed evidence that Teachbook’s trademark was confusingly similar to Facebook and that it would cause harm to it.  Our first impression is that Facebook has an uphill battle proving that consumers will be confused between the two trademarks.

A spokesperson for Facebook commented that it would likely re-file the case. 

vent.jpgSan Diego – The United States Patent and Trademark Office (USPTO) has issued  a “Notice of Allowability” to EarthSure Renewable Energy Corp. declaring that its WindAir patent has been approved.  This notice of allowance means that the USPTO has decided that this is a novel invention and that the USPTO has the intention of granting the patent.

EarthSure’s new WindAir technology creates an innovative form of clean, renewable energy.  WindAir utilizes a mechanical method that captures the exhausted airflow from commercial air conditioning and outdoor refrigeration condenser units and then converts it into a source of renewable, clean energy by using its second stage air fan turbine.  With the world-wide application of this innovative technology, EarthSure aims to lower electric consumption, thus reducing greenhouse gases.

EarthSure CEO and WindAir inventor Raymond Saluccio stated, “A recent U.S. Supreme Court case has been the most important patent ruling in years because it raises the bar in obtaining patents on new products that rely on new combinations of existing publicly known elements.  This ruling makes all patents in the renewable energy field more valuable because of the difficulties in obtaining them.”  He went on to say that at this point in his business, patents are extremely important because they provide access to new inventions.

With an increased  sense of urgency to stop global warming, and green technologies in demand, the WindAir technology comes at a good time.  The demand for alternative methods of renewable energy has led to increased government funding and venture capital investment so innovators can expect a bright future in the effort to help save the planet.