IP UPDATE
Exploring the Latest in Intellectual Property Law
IP UPDATE
Exploring the Latest in Intellectual Property Law
Patent & Trademark Office/PTO
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Oh, Fudge. TTAB Finds Curse Word Fails to Function as Trademark

by | Sep 8, 2022 |

The US Patent & Trademark Office (PTO) denied registration of several US trademark applications for the mark FUCK, even though the applicant had overcome a prohibition on the registration of “immoral or scandalous” trademarks as a violation of the First Amendment in the Supreme Court’s 2019 decision in Iancu v. Brunetti. The applicant also had previously secured registration of the mark FUCT. The PTO nevertheless denied registration on grounds that the familiar curse word did not function as a trademark. In re: Brunetti, Ser. Nos. 88308426; 88308434; 88308451; 88310900 (TTAB Aug. 22, 2022) (Bergsman, Dunn, Lebow, Administrative Trademark Judges).

The Trademark Trial & Appeal Board (Board) issued a precedential decision affirming the PTO’s refusal to register the FUCK mark for a variety of goods and related services, including cellphone cases, sunglasses, jewelry, watches, bags and wallets. The Board found that the word FUCK expresses well-recognized sentiments and that consumers are accustomed to seeing the word in widespread use by many different sources. As a result, the word failed to create the commercial impression of a source indicator and therefore failed to function as a trademark to distinguish the goods from others.

BACKGROUND

Artist and entrepreneur Erik Brunetti applied to register the mark FUCK in relation to a wide variety of wearable goods, electronics accessories and related retail, marketing and business services in 2019 while his appeal to the Supreme Court regarding the FUCT mark was still pending. When the Supreme Court issued its decision, the FUCK applications were removed from suspension and could no longer be refused on grounds that the mark comprised “immoral or scandalous” material. The PTO examining attorney re-examined the applications and refused registration on the so-called “failure to function” ground, finding that the mark was a term that did not function as a trademark to indicate the source of the applicant’s goods or services and to identify and distinguish them from others. Brunetti appealed to the Board.

In response to Brunetti’s argument that there was no statutory basis for a failure to function refusal, the Board made clear that the PTO is statutorily constrained to register a mark on the Principal Register “if and only if it functions as a mark.” Matter that does not operate to indicate the source or origin of the identified goods or services and distinguish them from those of others does not meet the statutory definition of a trademark and may not be registered. The Board reminded applicants that not every designation adopted with the intention that it perform a trademark function necessarily accomplishes that purpose.

Matter may be merely informational and fail to function as a trademark if it is a common term or phrase that consumers are accustomed to seeing used by various sources to convey ordinary, familiar or generally understood concepts or sentiments. The critical inquiry in determining whether a proposed mark functions as a trademark is how the relevant public perceives it.

The Board described the Examining Attorney’s evidence supporting the failure to function [...]

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Thee I Dismiss: No Love for Failure to Add Necessary Party

by | Sep 8, 2022 |

After concluding that a trademark owner’s case for failure to add a necessary party was untenable, the US Court of Appeals for the Fifth Circuit affirmed a district court’s dismissal of the case because the necessary party enjoyed sovereign immunity and could not be added. Lee et al. v. Anthony Lawrence Collection, L.L.C. et al., Case No. 20-30769 (5th Cir. Aug. 24, 2022) (Jolly, Elrod, Oldham. JJ.)

Curtis Bordenave and Paige Lee are in the business of owning trademarks. They petitioned the US Patent & Trademark Office (PTO) for a federal registration of the mark THEEILOVE. The phrase “Thee I Love” comes from Jackson State University, which has used the phrase for roughly 80 years. Collegiate Licensing Company is a licensing agent that handles the licensing of Jackson State’s trademarks to manufacturers that make and sell Jackson State merchandise.

Despite Jackson State’s decades-long use of the phrase, it never applied for a federal mark until after Bordenave and Lee had already done so. Jackson State did register a mark under Mississippi law in 2015 for use on vanity plates and in 2019 for use on other merchandise. It also claimed to have common-law rights to the mark under the Lanham Act.

Bordenave and Lee sued Collegiate Licensing Company and a few of the licensees in charge of producing and selling Jackson State’s merchandise for various claims related to their licensing, manufacturing and selling of “Thee I Love” merchandise, including trademark infringement and unfair competition under the Lanham Act. Bordenave and Lee sought damages, a permanent injunction barring the defendants from producing or selling any more “infringing” merchandise, and a declaration that defendants infringed Bordenave and Lee’s registered marks. The defendants moved to dismiss under Fed. R. Civ. Pro.12(b)(1) and (7), arguing that Jackson State was a required party, and because Jackson State enjoys sovereign immunity, Bordenave and Lee’s case should be dismissed. The district court dismissed the case without prejudice under Rule 12(b)(7). Bordenave and Lee appealed.

The Fifth Circuit affirmed the district court’s ruling. First, the Court determined that Jackson State was a required party, stating that Jackson State had an interest in the action that would be impaired or impeded if Jackson State was not joined in the suit. The Court reasoned that even if Jackson State remained free to challenge Bordenave and Lee’s ownership of THEEILOVE elsewhere, it could still face challenges protecting its interest if it was not joined in this action.

Next, because Jackson State has sovereign immunity, the Fifth Circuit considered whether the district court abused its discretion in dismissing the case rather than proceeding without Jackson State. Jackson State enjoys sovereign immunity as an arm of the State of Mississippi. Because Jackson State had a non-frivolous claim here, the Court found that dismissal was required because of the potential injury to Jackson State’s interest as an absent sovereign.

Finally, the Fifth Circuit considered the four factors under Rule 19(b) that determine whether an action should continue without the absent party or be dismissed. [...]

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Seal of Disapproval: TTAB Refuses Registration of County Logos

by | Aug 18, 2022 |

The Trademark Trial & Appeal Board (Board) issued a precedential decision affirming the US Patent & Trademark Office (PTO) Examining Attorney’s refusal to register two different logo marks filed by southern California’s County of Orange because the marks consisted of and comprised, respectively, an insignia of a municipality. The Board found that a logo adopted by a government entity does not have to be “official” to constitute an insignia for which trademark registration is prohibited under Section 2(b) of the Trademark Act, 15 U.S.C. §1052(b). In re County of Orange, Ser. Nos. 87419378; 87639750 (TTAB, Aug. 4, 2022) (Shaw, Coggins, Allard, Administrative Trademark Judges).

The County applied to register two logo marks. The US trademark applications described one mark as “a circle with the image of three oranges in front of an orange grove and . . . mountains with the words ‘COUNTY OF ORANGE’ . . . and . . . ‘CALIFORNIA’ . . . [around] the circle” (Circle Mark). The second logo mark featured a park ranger badge design that encompassed the Circle Mark in its entirety.

The PTO examining attorney refused registration of both logo marks under Section 2(b), which imposes an absolute bar on registration on either the Principal or Supplemental Register of a mark that “[c]onsists of or comprises the flag or coat of arms or other insignia of the United States, or of any State or municipality, or of any foreign nation, or any simulation thereof.”. This section reflects the sentiment that such symbols are indicia of government authority that ought to be reserved solely for signifying the government, and which should not be registered as symbols of origin for commercial goods and services.

On appeal to the Board, the County argued that the logo marks did not constitute “insignia” because they were not an “official” seal of the County, and, even if they were, registration should not be precluded because the County is not a “municipality.” Considering both of these arguments in turn, the Board provided analysis specific to both the circle and badge iterations of the applied-for logos.

The County argued first that the proposed marks could not constitute an insignia of Orange County, California, because the County created and adopted an official seal (a design of an orange having a stem with three leaves) more than a century ago, in accordance with the applicable state government code requiring a two-step process for adopting an official seal.

The Board found this argument unpersuasive, noting that although the Circle Mark had not undergone the state’s two-step process to become an “official” seal, Section 2(b) does not distinguish between “official” and “unofficial” insignia. Therefore, formal adoption of an “official” seal is not required for an insignia to otherwise fall under the Section 2(b) bar to registration.

The Board explained that the County uses the Circle Mark for a plethora of official government business [...]

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PTO Presentation Seeks to Clarify Subject Matter Eligibility Requirements

by | Aug 18, 2022 |

On August 9, 2022, the US Patent & Trademark Office (PTO) gave a public presentation, “Subject Matter Eligibility Under 35 U.S.C. § 101: USPTO Guidance and Policy.” During the presentation, the PTO indicated that its goal is to identify eligible subject matter and not reject patent applications under 35 U.S.C. § 101 where possible. However, subject matter eligibility must be determined in accordance with Supreme Court precedent as set forth in Bilski v. Kappos (2010); Mayo Collaborative Servs. v. Prometheus Labs, Inc. (2012); Association for Molecular Pathology v. Myriad Genetics, Inc. (2013); and Alice Corp. v. CLS Bank International (2014). The PTO presented several biotech examples demonstrating how subject matter ineligible claims could be redrafted to encompass eligible subject matter.

The PTO presented a detailed explanation of the two-step subject matter eligibility flowchart in MPEP § 2106 and emphasized the differences between the two prongs of Step 2A. The first prong is to evaluate whether the claim recites a judicially recognized exception to eligibility. If the claims do not recite an exception, they qualify as eligible subject matter. If the claims do recite a judicial exception, the analysis proceeds to the second prong of Step 2A, which is to evaluate whether the claims recite additional elements that integrate the exception into a practical application of the exception. If the claims do recite additional elements integrating the exception into a practical application of the exception, they qualify as eligible subject matter. If the claims do not do so, the analysis proceeds to Step 2B to determine whether the claims recite additional elements that amount to significantly more than the judicial exception.

While there is significant overlap between Step 2A prong two and Step 2B, the PTO noted that under Step 2A prong two, the additional elements may be well understood, routine, conventional activity, unlike in Step 2B. For example, if conventional steps were used to affect a particular treatment or prophylaxis for a disease or medical condition, or if conventional material was used in an unconventional application, the claims would be subject matter eligible.

The PTO warned against claiming methods as a series of mental processes, mere data gathering or steps that merely apply the judicial exception.

As noted, the PTO highlighted techniques for transforming subject matter ineligible claims into subject matter eligible claims. These techniques include reciting properties that naturally occurring compositions do not possess, showing that the claimed composition possesses properties not found in naturally occurring compositions, using a conventional material or conventional method in an unconventional application and specifying a particular treatment.

Practice Note: Readers may be interested in an IP Update Legislative Alert reporting on a bill introduced by Senator Tillis to amend §101, which can be found here.



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Rage against the Machine: Inventors Must Be Human

by | Aug 11, 2022 |

The US Court of Appeals for the Federal Circuit found that an artificial intelligence (AI) software system cannot be listed as an inventor on a patent application because the Patent Act requires an “inventor” to be a natural person. Thaler v. Vidal, Case No. 21-2347 (Fed. Cir. Aug. 5, 2022) (Moore, Taranto, Stark, JJ.)

Stephen Thaler develops and runs AI systems that generate patentable inventions, including a system that he calls his “Device for the Autonomous Bootstrapping of Unified Science” (DABUS). In 2019, Thaler sought patent protection for two of DABUS’s putative inventions by filing patent applications with the US Patent & Trademark Office (PTO). Thaler listed DABUS as the sole inventor on both applications. The PTO found that the patent applications lacked valid inventorship and sent a Notice of Missing Parts requesting that Thaler identify a valid inventor. Thaler petitioned the director to vacate the notices. The PTO denied the petitions, explaining that a machine does not qualify as an inventor and that inventors on patent applications must be natural persons. Thaler then pursued judicial review in the district court. The district court agreed with the PTO, concluding that an “inventor” under the Patent Act must be an “individual,” and that the plain meaning of “individual” is a natural person. Thaler appealed.

The sole issue on appeal was whether an AI software system can be an “inventor” under the Patent Act. The Federal Circuit started with the statutory language of the Patent Act, finding that it expressly provides that inventors are “individuals.” The Court noted that while the Patent Act does not define “individual,” the Supreme Court has explained that the term “individual” refers to a human being unless there is some indication that Congress intended a different reading. The Federal Circuit also found that this result was consistent with its own precedent, which found that neither corporations nor sovereigns can be inventors; instead only natural persons can be inventors.

The Federal Circuit rejected Thaler’s policy argument that inventions generated by AI should be patentable to encourage innovation and public disclosure. The Court found that these policy arguments were speculative, lacked any basis in the text of the Patent Act, and were contrary to the unambiguous text of the Patent Act. The Court also rejected Thaler’s reliance on the fact that South Africa has granted a patent with DABUS as an inventor, explaining that the South African Patent Office was not interpreting the US Patent Act. The Court concluded that since Congress has determined that only a natural person can be an inventor, AI cannot be an inventor.

Practice Note: The Federal Circuit’s decision comes on the heels of a decision from the US Copyright Office Review Board finding that a work must be created by a human being to obtain a copyright. The Federal Circuit also noted that it was not confronted with the question of whether inventions made by human beings with the assistance of AI are eligible for patent protection.



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PTO Issues Notice on Duties of Disclosure and Reasonable Inquiry

by | Aug 11, 2022 |

The US Patent & Trademark Office (PTO) issued a notice on July 29, 2022, titled “Duties of Disclosure and Reasonable Inquiry During Examination, Reexamination, and Reissue, and for Proceedings Before the Patent Trial and Appeal Board.” The notice comes in response to US President Joe Biden’s July 9, 2021, executive order on Promoting Competition in the American Economy, and to a September 9, 2021, letter from Senators Patrick Leahy (D-VT) and Thom Tillis (R-NC), who requested that the PTO “take steps to reduce patent applicants’ making inappropriate conflicting statements in submissions to the [PTO] and other federal agencies.”

PTO Director Vidal explained in the notice that parties involved in proceedings before the PTO should not take a position about the patentability of the claims that is inconsistent with positions taken in submissions to other government agencies regarding the same subject matter. If a party to a PTO proceeding discovers that an earlier position taken in a submission to the PTO or another government agency was incorrect or inconsistent with other statements made by the party, the party must promptly correct the record.

When an examiner has a reasonable basis to conclude that an individual identified under 37 CFR 1.56(c) or any assignee has information that would aid in the examination of the application or treatment of some matter, the examiner may require submission of information that is not necessarily material to patentability. This requirement could include statements made or information submitted to other government agencies, such as the US Food & Drug Administration (FDA).

Any party presenting a paper to the PTO has a duty to perform an inquiry that is reasonable under the circumstances. This reasonable inquiry may comprise a review of documents that are submitted to or received from other government agencies, including the FDA. If any reviewed document is material to the patentability of a pending matter before the PTO, the party has a duty to submit the information to the PTO.

Each individual with a duty to disclose, or each party with a duty of reasonable inquiry, should ensure that statements made to the PTO and other government agencies, or any statements made on their behalf to other government agencies regarding the claimed subject matter, are consistent. Providing material information to other government agencies, including the FDA, while simultaneously withholding the same information from the PTO violates those duties.

Further, any individual with a duty to disclose, or any party with a duty of reasonable inquiry, should review documents it receives from other government agencies to determine whether the information should be submitted to the PTO. For example, a party receiving a paragraph IV certification related to a generic drug application (e.g., an Abbreviated New Drug Application (ANDA)) should review such documents to determine whether they are material to the patentability of any pending matters before the PTO. If any information that is part of the ANDA process is deemed material to patentability in a pending PTO matter, then such [...]

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PTO Proposes Standardization of the Patent Term Adjustment Statement Regarding Information Disclosure Statements

by | Jul 21, 2022 |

The US Patent & Trademark Office (PTO) announced on July 12, 2022, that it intends to revise the rules pertaining to patent term adjustment to require that the patent term adjustment statement regarding information disclosure statements (IDS) be submitted on a PTO form. The PTO believes that the use of the form will streamline prosecution and be more accurate and efficient by eliminating the need for a manual review of the patent term adjustment statement.

The regulations in 37 CFR 1.704(c)(1) through (14) establish the circumstances that constitute an applicant’s failure to engage in reasonable efforts to conclude processing or examination of an application and the resulting reduction of any patent term adjustment. 37 CFR 1.704(d)(1) also provides a safe harbor for filing IDS. Filing only an IDS in compliance with §§ 1.97 and 1.98 or a request for continued examination with only a compliant IDS is not considered a failure to engage in reasonable efforts to conclude prosecution (processing or examination) of the application under 37 CFR 1.704(c)(6), (8), (9) or (10) if it is accompanied by the required statement. The statement required to accompany the paper or request for continued examination must affirm that each item of information contained in the IDS meets one of the following requirements:

  • It was first cited in any communication from a patent office in a counterpart foreign or international application or from the PTO, and this communication was not received by any individual designated in § 1.56(c) more than 30 days prior to the filing of the IDS.
  • It is a communication that was issued by a patent office in a counterpart foreign or international application or by the PTO, and this communication was not received by any individual designated in § 1.56(c) more than 30 days prior to the filing of the IDS.

The PTO proposes adding new paragraph (d)(3) to 37 CFR 1.704(d), which requires filers to submit the patent term adjustment statement under 37 CFR 1.704(d)(1) on a form PTO/SB/133 to derive the safe harbor benefit under 37 CFR 1.704(d). Form PTO/SB/133 includes the required statement described above. Filers who submit a 37 CFR 1.704(d)(1) patent term adjustment statement without using the form PTO/SB/133 and filers who submit the form PTO/SB/133 with any modification to the patent term adjustment statement will not receive the benefit of the safe harbor under 37 CFR 1.704(d). Under such circumstances, the IDS or the request for continued examination, with no submission other than an IDS, will be treated as unaccompanied by a patent term adjustment statement under 37 CFR 1.704(d)(1).

Comments on the proposed rule must be received by September 12, 2022, to ensure consideration.



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PTO Issues Report to Congress on Patent Eligible Subject Matter

by | Jul 14, 2022 |

On June 24, 2022, the US Patent & Trademark Office (PTO) issued a report to Congress titled “Patent Eligible Subject Matter: Public Views on the Current Jurisprudence in the United States.” The report comes in response to a March 5, 2021, letter from Senators Tillis (R-NC), Coons (D-DE), Hirono (D-HI) and Cotton (R-AR) expressing concern over a lack of consistency and clarity in US patent eligibility laws since the Supreme Court of the United States’ rulings in Alice Corp. v. CLS Bank International and Mayo Collaborative Services Inc. v. Prometheus Laboratories Inc. The PTO solicited public feedback until October 15, 2021, and the report summarizes the PTO’s findings based on the 141 comments it received.

The report found that supporters of the current state of the law on eligibility tended to be companies faced with abusive and costly litigation involving “overbroad” patents, mostly related to software. Those companies noted that the current law allows them to avoid or more efficiently resolve abusive and costly litigation. Some high-tech representatives noted that their investments and innovations have increased under current eligibility jurisprudence. Certain life sciences and patient advocacy organizations also favored the current law, noting its role in enhancing access to medical technologies.

Respondents critical of the current state of the law included many patent practitioners and innovative companies, especially companies involved in life sciences. These respondents stated that current law makes patents less available and rights less predictable and has inhibited investment in new technologies and companies. Several startups and small- and medium-sized enterprises also noted that the current law undermines innovation by decreasing the availability of private risk capital and works to concentrate markets in the hands of a few large, well-resourced entities, thereby decreasing competition. Some commenters stated that they no longer seek patents and instead rely on trade secrets, resulting in reduced public disclosure of technological innovations.

The PTO will continue to solicit feedback from stakeholders, including through listening sessions. The PTO noted that additional feedback and suggestions may be sent to 101@uspto.gov.



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PTO Lowers the Bar for Genericness Refusals

by | Jul 14, 2022 |

The US Patent & Trademark Office (PTO) recently issued Examination Guide 1-22, Clarification of Examination Evidentiary Standard for Marks Refused as Generic (Guide 1-22), which amends the PTO’s stance on the appropriate evidentiary burden for examining attorneys refusing registration based on genericness. Previously, the Trademark Manual of Examining Procedure (TMEP) required an examining attorney to meet the demanding “clear evidence” standard to establish the prima facie case necessary for a genericness refusal. Guide 1-22, however, sets forth a lesser burden, stating that examining attorneys need only sufficient evidence to support a “reasonable predicate” for finding a mark generic. The shift marks a clear departure from longstanding TMEP practice.

The PTO credits the US Court of Appeals for the Federal Circuit as the initial source of the “clear evidence” standard. In its 1987 case In re Merrill Lynch, Pierce, Fenner, and Smith, Inc., the Federal Circuit relied on language in the TMEP stating that “the showing [for a genericness refusal] must be based on clear evidence of generic use.” Following this decision, the TMEP was revised to include the “clear evidence” standard, and the Federal Circuit later found that “clear evidence” is equivalent to “clear and convincing evidence.”

Despite years of reliance on the “clear evidence” standard, Guide 1-22 asserts that “there is no statutory basis for applying a heightened standard.” The guide states that the Federal Circuit initially misinterpreted the TMEP: “Read in context, the term ‘clear’ was meant to convey the ordinary meaning of the term, not an evidentiary burden.” Further, the Federal Circuit’s interpretation of “clear evidence” as equivalent to “clear and convincing evidence” “was not intended by the TMEP and is inconsistent with the preponderance of the evidence burden the Federal Circuit requires to prove claims that a registered mark is generic in the inter partes cancellation context.”

Following issuance of Guide 1-22, the PTO revised the TMEP to reflect the “reasonable predicate” evidentiary standard for genericness refusals. (See TMEP § 1209.01(c)(i).)

Practice Note: Agency guidelines do not have the force of law, so it will be interesting to see how the Federal Circuit treats these updated guidelines.



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