Other Barks & Bites for Friday, December 12: Disney Cuts Character Licensing Deal with OpenAI; USPTO Supports Public Performance Rights on Radio Under Copyright Act; and EU General Court Reduces Intel Fine by €140 Million

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Dan Papst’s (Papst Licensing) Japanese Akita, HINJU.

This Week in Other Barks & Bites: the EU’s General Court reduces a fine levied against Intel for anticompetitive behavior in the microprocessor market by €140 million; the Federal Circuit finds that an assignment of pre-existing common law rights to business goodwill is not barred by the Lanham Act’s provisions restricting assignment of intent-to-use trademark applications; Oracle and Broadcom release earnings reports this week showing vastly different prospects in the current AI market; a bill to improve safe harbor for skinny labels on FDA-approved generic treatments is introduced into the U.S. House of Representatives; USPTO Director John Squires sends a letter to Congress supporting legislative changes to the Copyright Act that would require AM/FM radio stations to pay public performance rights; the FTC applauds Teva’s decision to delist more than 200 patents from the Orange Book; Dolby files a patent infringement suit in the UPC to assert audio codec SEPs; and Disney signs a landmark character licensing deal with OpenAI while also warning Google to stop infringing uses of its copyrights via Google’s AI platforms.

Bites

Disney Signs Landmark Character Agreement With OpenAI, Tells Google to Cease and Desist – On Thursday, December 11, generative artificial intelligence (AI) developer OpenAI announced that it had entered into a three-year licensing agreement with media entertainment conglomerate The Walt Disney Company involving a $1 billion equity investment by Disney into OpenAI for the use of its application programming interfaces (APIs) while opening a vast portfolio of more than 200 characters from Disney brands including Marvel, Pixar and Star Wars. Recent news reports indicate that, the evening before the OpenAI announcement, Disney sent a cease-and-desist letter to Google ordering the Internet services giant to stop its massive infringement of Disney’s copyrighted characters and other works in its own AI platforms.

CAFC Finds No Assignment in Gross in Transfer of Trademark With Associated Goodwill – On Wednesday, December 10, the U.S. Court of Appeals for the Federal Circuit issued a precedential decision in Game Plan, Inc. v. Uninterrupted IP, LLC affirming the Trademark Trial and Appeal Board’s (TTAB) cancellation of Game Plan’s trademark registration and dismissing Game Plan’s opposition to six intent-to-use applications filed by Uninterrupted for its “MORE THAN AN ATHLETE” marks. The Federal Circuit found that a 2019 assignment of common law rights to Uninterrupted trademark applications, including “all of the goodwill of the business related to” the marks, gave priority in the use of the contested marks to Uninterrupted, and also ruled that the assignment, which was executed after Game Plan filed its opposition, was not invalid under 15 U.S.C. § 1060(a)(1)’s restriction against assignment of intent-to-use trademark applications because the assignment was for pre-existing common law rights to an already-used mark.

EU General Court Upholds Second Fine Against Intel After €140M Reduction – On Wednesday, December 10, the General Court of the European Union issued a judgment upholding a September 2023 fine levied by the European Commission against American semiconductor designer Intel for anticompetitive behavior in excluding rival company AMD from the x86 microprocessor market, the second fine issued by the EU Commission against Intel following the EU General Court’s annulment of a €1.06 billion fine in January 2022. Although the EU General Court upheld the new fine over so-called “naked” restrictions imposed by Intel upon HP, Acer and Lenovo, the General Court reduce the fine by about €140 million to slightly more than €237 million to account for the relatively limited number of computers affected by those restrictions and the 12-month gap in certain anticompetitive practices.

USPTO Supports Amending Copyright Act Expanding Public Performance Rights – On Tuesday, December 9, a letter signed by U.S. Patent and Trademark Office (USPTO) Director John Squires and addressed to the leadership of Committees on the Judiciary in both houses of Congress expressed the USPTO’s support of amendments to the Copyright Act that would require operators of terrestrial AM/FM radio stations to provide compensation to copyright owners for public performance rights similar to royalties paid by operators of digital radio stations pursuant to both the Digital Performance Right in Sound Recordings Act of 1995 and the Digital Millennium Copyright Act of 1998. Director Squires noted that streaming services now account for 74% of U.S. recorded music revenues, undercutting the rationale that broadcast radio would contribute to increased album sales, and that the current state of the law allows foreign broadcast operators to deny public performance royalties for U.S. music played internationally. The topic was also the subject of a hearing held by the Senate IP Subcommittee on Tuesday featuring Kiss co-founder, Gene Simmons.

Netlist Sees Mixed Success at CAFC on Patent Validity Appeals from PTAB – On Tuesday, December 9, the Federal Circuit issued a pair of rulings in appeals from inter partes review (IPR) proceedings conducted before the Patent Trial and Appeal Board (PTAB) challenging patent claims owned by advanced memory developer Netlist and asserted in U.S. district court and at the U.S. International Trade Commission against Samsung, Google and other large tech firms. In both rulings, the Federal Circuit issued a Rule 36 judgment affirming the PTAB, upholding the validity of claims from two Netlist patents in one decision and affirming the invalidity of Netlist patent claims covering memory modules with adjustable memory signal timing in the other ruling. For Netlist’s U.S. Patent No. 10217523, this is the second Federal Circuit ruling affirming validity on appeal from the PTAB following a ruling this March in an appeal by Samsung.

Reps. Cline, Lofgren Introduce Skinny Labels, Big Savings Act – On Monday, December 9, U.S. Representatives Ben Cline (R-VA) and Zoe Lofgren (D-CA) introduced the Skinny Labels, Big Savings Act into the House of Representatives, proposing legislation previously introduced this year into the U.S. Senate that would establish provisions regarding safe harbor for infringement of a method of use patent that could be caused by commercial marketing. According to a press release, the bill as currently drafted would eliminate liability for generic manufacturers obtaining market approval from the U.S. Food & Drug Administration (FDA) while allowing them to describe their generics as FDA-approved therapeutic equivalents, provided that description aligns with FDA regulations.

Barks

FTC Cheers Teva Decision to Delist 200 Patent Listings From Orange Book – On Wednesday, December 10, the Federal Trade Commission (FTC) announced that Israeli drugmaker Teva Pharmaceuticals had requested that the U.S. Food & Drug Administration (FDA) remove more than 200 patent listings from the agency’s Orange Book covering treatments for asthma, diabetes and COPD following the FTC’s enforcement campaign against allegedly improper patent listings in the Orange Book.

Third Circuit Affirms False Advertising Finding, Reduced Disgorgement Award in Caulking Gun Appeal – On Wednesday, December 10, the U.S. Court of Appeals for the Third Circuit issued an opinion in Newborn Bros. Co., Inc. v. Albion Engineering Co. affirming orders from the District of New Jersey issuing a permanent injunction against Albion for marking imported caulking guns as “manufactured in the USA,” and reducing the disgorgement award available under the Lanham Act after the district court accepted Albion’s unclean hands defense for Newborn Bros.’ own false marking of imported caulking guns as made in the U.S.

Dolby Files Infringement Suit in UPC’s Hague Division Over Opus Audio Codec SEPs – On Wednesday, December 10, UK-based IP licensing company Vectis announced that Dolby, one of the licensors for the pool of standard-essential patents (SEPs) covering the Opus audio codec for Internet transmissions of speech and music, filed a lawsuit against Acer in the Hague division of the Unified Patent Court (UPC) asserting SEPs covering practice of the technological standard.

Second Circuit Lacks Jurisdiction Over Order Clarifying Trademark Injunction – On Tuesday, December 9, the U.S. Court of Appeals for the Second Circuit issued a summary order in Lego A/S v. Zuru Inc. dismissing Zuru’s appeal of an order by the District of Connecticut finding that certain redesigned toy figurines were subject to an existing preliminary injunction, ruling that the appellate court lacked appellate jurisdiction over orders that merely interpret or clarify the terms of an earlier-entered injunction.

EPO Study Reports 75K Unitary Patents Registered, Strong Uptake Among SMEs – On Tuesday, December 9, the European Patent Office (EPO) published its findings from a review of the Unitary Patent system finding that 75,000 patents with unitary effect have been registered since the system first took effect in June 2023, with uptake rates higher for EU small- and medium-sized enterprises (SMEs) as well as universities and public research organizations.

Sens. Cantwell, Blackburn Introduce HUSTLE Act to Create NIL Investment Accounts – On Monday, December 8, U.S. Senators Maria Cantwell (D-WA) and Marsha Blackburn introduced the Helping Undergraduate Students Thrive with Long-Term Earnings (HUSTLE) Act, which if enacted would create new tax-advantaged savings vehicles that would allow collegiate athletes to save money earned from the use of their name, image and likeness (NIL) rights and require the National Collegiate Athletic Association (NCAA) to create a public searchable database of NIL agents.

This Week on Wall Street

Earnings Reports Show Broadcom Hitting, Oracle Whiffing on AI Investments – On Wednesday, December 10, shares of American technology developer Oracle Corp. fell 11% in extended trading, with analysts citing the company’s overly aggressive investments in artificial intelligence including a $300 billion deal with OpenAI as a reason for Oracle’s quarterly revenues miss. The following day, American semiconductor designer Broadcom announced earnings for its fourth quarter, beating analyst expectations on both earnings per share and revenue with Broadcom CEO Hock Tan informing investors that the company expects to see sales of AI chips in the upcoming quarter to rise to $8.2 billion.

Quarterly Earnings – The following firms identified among the IPO’s Top 300 Patent Recipients for 2024 are announcing quarterly earnings next week (2023 rank in parentheses):

• Monday: None
• Tuesday: Micron Technology Inc. (16th)
• Wednesday: None
• Thursday: Accenture plc (t-281st); Nike, Inc. (104th)
• Friday: None