Sixth Circuit decides trademark rights in dispute arising after two asset sales involving an unregistered trademark

By Porter Wright on March 4, 2013

Stating that it “will not presume the creation of jointly owned or non-exclusively licensed trademark rights,” the Sixth Circuit Court of Appeals recently held that an individual defendant and his company did not retain any ownership rights in an unregistered trademark his company had acquired in an asset sale and then transferred in another asset sale. [See Yellowbook Inc. v. Brandeberry, No. 11-4267 (6th Cir. Feb. 27, 2013).] The Sixth Circuit reversed the district court’s finding of no trademark infringement and remanded the case to the district court to enter appropriate injunctive relief and determine damages for trademark infringement.

The Sixth Circuit’s holding reinforces the importance of:

Identifying all the trademark rights being purchased and by whom in a purchase agreement
Purchasing the goodwill associated with the trademark rights being purchased
Researching the chain of title of the trademarks being purchased and potential claims of ownership of those marks

It also illustrates why it is recommended that businesses register their trademarks with the U.S. Patent and Trademark Office and/or at the state level to secure a presumption of ownership of a mark.

Social media privacy makes its way to Capitol Hill

By Porter Wright on February 26, 2013

Editors’ Note: Colleen Marshall, a Senior Attorney in Porter Wright’s Litigation Department, is also a widely-recognized, award-winning news anchor for Columbus’ NBC-affiliate, WCMH – 4. In a detailed interview with Porter Wright’s Sara Jodka last week, Colleen reports on the use of social media by employers: “You Can’t Delete Your Way Out Of Social Media.”

As noted in a recent blog post and in the news report mentioned above, 21 states have social media privacy legislation pending. But, social media privacy could soon be governed by an act of Congress.

Representative Elliot Engel (D-N.Y.) just introduced H. R. 537, the “Social Networking Online Protection Act” that he says will protect both employees and job applicants from employer efforts to obtain passwords to private social media accounts. Unlike most laws currently being considered on the state level, Engel’s bill would also protect passwords to email accounts. The bill is currently in the House Committee on Education and the Workforce, and makes a critical distinction between private accounts and social networking accounts owned by employers but maintained by employees in the course of employment.

Ohio Senate Bill 45, the Social Media Privacy Protection Act, is the most recent state effort to prohibit employers from gaining access to private electronic accounts, such as Facebook. Ohio 15th District Senator Charleta Tavares (D-Columbus) introduced the bill in an effort to prohibit employers, employment agencies, personnel placement services, and labor organizations from requiring an applicant or existing employee to surrender their personal password to a social media account. Senator Tavares says she views any effort to obtain an employee’s passwords as an invasion of privacy. Similar bills were passed in 2012 in six states: California, Delaware, Illinois, Maryland, Michigan and New Jersey.

First-to-File Patent System Arrives March 16, 2013

By Marty Miller on February 22, 2013

With significant changes to law governing how the U.S. grants patents taking effect next month, Porter Wright recommends that all clients consider filing any contemplated patent applications by March 15. This includes filing non-provisional patent applications, and in some cases Patent Cooperation Treaty (PCT) patent applications, that are based upon any provisional or non-U.S. patent application filed since March 2012. Though there are some exceptions to this advice, waiting until after March 15 may be problematic.

In brief: For patent applications having any claim with an effective filing date after March 15, it will no longer be possible to overcome prior art by showing an earlier date of invention. Thus, the prior art for purposes of patentability will include: 1) third-party public disclosures of any kind, anywhere in the world, prior to your effective filing date; and 2) issued U.S. patents and published U.S. or PCT patent applications that were effectively filed before your effective filing date. In addition to not being able to "swear behind" a prior art reference by proving an earlier date of invention, the prior art date for patents and published patent applications may be as much as 18 months earlier than under current law because of foreign priority claims.

It is also important to note that inventors will not lose the benefit of any earlier provisional or non-U.S. patent application should they wait until after March 15 to file. Any claims that are adequately supported in the earlier filing will be entitled to that earlier filing date for purposes of patentability. However, if even one claim in the post-March 15 application is new (i.e., includes subject matter not disclosed in your earlier application) the new first-to-file rules will apply to all claims — and there will be no way to alter this scenario through actions such as deleting claims containing the new subject matter.

A Porter Wright Law Alert describes these patent law changes in greater detail.

First-to-file patent system arrives March 16, 2013

By Marty Miller on February 22, 2013

In brief: For patent applications having any claim with an effective filing date after March 15, it will no longer be possible to overcome prior art by showing an earlier date of invention. Thus, the prior art for purposes of patentability will include: 1) third-party public disclosures of any kind, anywhere in the world, prior to your effective filing date; and 2) issued U.S. patents and published U.S. or PCT patent applications that were effectively filed before your effective filing date. In addition to not being able to “swear behind” a prior art reference by proving an earlier date of invention, the prior art date for patents and published patent applications may be as much as 18 months earlier than under current law because of foreign priority claims.

A Porter Wright Law Alert describes these patent law changes in greater detail.

Ohio Appellate Court disallows forensic imaging of a non-party witness’s computers because witness’s privacy interests outweighed need for imaging

By Porter Wright on February 19, 2013

An Ohio appellate court recently overturned a trial court’s order that compelled the production and forensic examination of a non-party witness’s computers, hard drives, and cell phones because “a trial court abuses its discretion when it permits forensic imaging of electronic devices without first a showing that there has been a background of noncompliance with discovery and the need for forensic imaging outweighs the party’s privacy interests.” Scott Process Systems, Inc. v. Mitchell, 2012-Ohio-5971, ¶38 (Ohio Ct. App. Dec. 17, 2012). Because forensic imaging (or “mirror imaging”) of a hard drive replicates “bit for bit, sector for sector, all allocated and unallocated space, including slack space,” on the drive, a non-party witness’s privacy and confidentiality concerns must be carefully balanced against the requesting party’s discovery interests and need for the imaging. Id. at ¶¶28-29.
Other courts also have applied a balancing test in the context of civil discovery to determine whether the forensic imaging of a party’s electronic devices is justified under the circumstances. See, e.g., Wynmoor Community Council, Inc. v. QBE Insurance Corporation, 280 F.R.D. 681, 687 (S.D. Fla. 2012) (ordering forensic examination of the plaintiffs’ computers because they were either unwilling or unable to conduct a search of their computers systems for responsive documents); Musket Corp. v. Star Fuel of Oklahoma, LLC, No. CIV-11-444 (W.D. Okla. Sep. 21, 2012) (disallowing forensic examination of hard drive after stating that “[d]irect inspection of an opponent’s hard drive is not routine and may be justified only in certain circumstances,” and that when ordered such inspections must be done under “specific protocols that would preserve claims of attorney-client privilege and protection of the confidentiality of personal information”); Nithiananthan v. Toirac, 2012-Ohio-431 (Ohio App. Feb. 6, 2012) (overturning order for forensic examination of a party’s personal computers because the record failed to support a finding of “a history of discovery violations” by the party); see also Scentsy, Inc., v. B.R. Chase, LLC, No. 1:11-cv-00249 (D. Idaho Oct. 2, 2012) (denying motion to compel forensic examination of the plaintiff’s computer system because of the undue burden and cost of the examination even though the plaintiff implemented an insufficient litigation hold).
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$12.4 million in fees awarded for patent and trade secret claims brought in bad faith, including fees for “computer-assisted algorithm-driven document review”

By Porter Wright on February 15, 2013

A federal district court recently awarded more than $12.4 million in attorneys’ fees to the defendants as “prevailing parties” based on its finding that the plaintiffs had pursued objectively baseless patent and trade secret misappropriation claims in bad faith. [See Gabriel Technologies Corp. v. Qualcomm Inc., No. 08 CV 1992, 2013 U.S. Dist. LEXIS 14105 (S.D. Cal. Feb. 1, 2013)] As part of the award, the court awarded $2,829,349.10 in fees “attributable to computer-assisted, algorithm-driven document review” developed and employed by H5, which is an e-discovery vendor that obtained a patent last year on certain aspects of its technology-assisted review process. The court found that the method of document review used in the case reduced the overall fees and attorney hours incurred by the defendants and, therefore, found the requested amount of fees to be reasonable.

In Gabriel Technologies, the plaintiffs brought suit in 2008 against Qualcomm Inc. and an individual defendant asserting ownership rights in numerous Qualcomm patents related to GPS technologies. The suit arose out of events related to technology licenses and joint ventures between the plaintiffs, and their predecessor in interest, and the defendants dating back to 1998. The plaintiffs initially asserted 11 claims for relief, including breaches of a 1999 license agreement and a 2006 license agreement, fraud, tortious interference with contract, correction of patent inventorship, declaration of patent ownership, equitable patent infringement, trade secret misappropriation, conversion, unfair competition and unjust enrichment, and sought more than $1 billion in damages. Most of the plaintiffs’ claims were dismissed early in the litigation.

SHOCKING NEWS!! We are spending too much time surfing the web for personal reasons at work. What to do about these cyberloafers??

By Brian Hall on February 8, 2013

According to a news release issued by the university, a Kansas State University study to be published in the journal Computers in Human Behavior concludes that between 60% and 80% of the time spent by people on the internet at work has “nothing to do with work.” The study, which was profiled yesterday on The Today Show, suggests that “cyberloafers” come in all ages. According to one of the researchers, “Older people are doing things like managing their finances, while young people found it much more acceptable to spend time on social networking sites like Facebook.”

Certainly, while the estimated percentage might be unexpectedly high to some, there is no doubt that workers are spending more time on the internet for personal reasons. The study goes on to note that employer electronic monitoring policies do little to change behaviors unless the policies are enforced. According to the news release announcing the study, “Researchers discovered that the only way to change people’s attitudes is to provide them with information about other employees who were reprimanded.”

The question I have is whether enforcement of these policies really discourages employees from surfing the web or whether it merely drives the behavior underground. My bet is that many — I won’t say most — employees who fear discipline as a result of electronic monitoring at work will simply resort to using their personal electronic devices, which the employer will not be able to monitor. In my mind, the best way for an employer to ensure that workers are actually working is to monitor their actual work performance, both quantity and quality, and in the process it will catch most, if not all of its cyberloafers.

Changes to Children’s Online Privacy Protection Act (COPPA) Rule Become Effective July 1, 2013

By Porter Wright on February 7, 2013

The amendments to the rule implementing COPPA have been met with varying degrees of celebration, skepticism, disappointment and confusion. The amendments change all aspects of the rule, though some to a greater degree than others. While a full understanding of the impact of the amendments will likely have to wait until we see how they are enforced, a review of the amendments is, nonetheless, helpful in preparing for the July 1, 2013 effective date of the amended rule.

Adopted in December by the Federal Trade Commission (FTC), to keep up with changing technology, the amendments were designed to "strike the right balance between protecting innovation that will provide rich and engaging content for children, and ensuring that parents are informed and involved in their children’s online activities," according to FTC Chairman Jon Leibowitz, who has since announced his intention to resign effective mid-February. (Read the text of the Federal Register notice.)