Posts in Business

On June 28, a group of 16 individuals filed a class action complaint in the Northern District of California against generative artificial intelligence (GAI) developer OpenAI on several alleged violations of federal and state law on privacy, unfair business practices and computer fraud. The class action lawsuit’s discussion on property interests in consumer data underscores the intellectual property issues that have arisen since the advent of generative AI platforms like ChatGPT, which scrapes personal data and IP-protected material to train its GAI systems.

Upcycling, a recent fashion trend, poses issues and concerns for brand owners that are similar to counterfeiting but with some added complexity. As a result, upcycled products have prompted brand owners to take legal action to protect their brands and consequently their customers. Below, we (1) explain what upcycling is, (2) discuss potential legal issues arising from upcycled products, (3) summarize recent cases involving upcycled products, and (4) propose successful brand protection measures.

Earlier this week, the Information Technology and Innovation Foundation (ITIF) released a report that offers a rebuttal to nine claims it identifies with the “anti-IP progressive orthodoxy.” Prominent progressive senators, including Senators Bernie Sanders (D-VT) and Elizabeth Warren (D-MA), have turned up the heat on pharmaceutical companies’ drug pricing and IP policies. While members of Congress on both sides of the aisle have criticized big pharma, the ITIF report identifies other “anti-IP advocates” to rebut including the Electronic Frontier Foundation (EFF), Public Knowledge, Joe Stiglitz, Dean Baker, and Arjun Jayadev. The ITIF report promotes the narrative that intellectual property rights are foundational to the United States as a nation and economy. However, the ITIF argues that anti-IP advocates are trying to persuade the Biden administration to move away from this traditional position.

As a patent practitioner and corporate strategist speaking at IPWatchdog’s Patent Prosecution & Portfolio Management Masters program next week, on a panel titled “Strategic Portfolio Acquisition and Maintenance; Ensuring Business Objectives Align with Patent Strategy,” I decided to gather some resources that help organize potential business objectives and questions that can be answered so that patent strategy, portfolio maintenance, and portfolio acquisition are able to be aligned with a business strategy. Patent strategy is only a part of an overall intellectual property strategy. The intellectual property strategy should be part of a business strategy – although it often is not.

Taco Bell is on the short list as one of my guilty (or not-so-guilty) pleasures. So, when the popular restaurant chain filed a cancellation action against the TACO TUESDAY trademark, I knew I had to write a piece about it. On May 16, 2023, Taco Bell filed a Petition for Cancellation of the trademark for TACO TUESDAY, which was registered by Spicy Seasonings, LLC in 1989 for “restaurant services. Spicy Seasonings operates the Taco John’s restaurant franchise. As you can see on their website, they claim to have coined the phrase.

Artificial Intelligence (AI) has become a crucial tool for organizations in various sectors, particularly in the generation of content and code by generative AI systems such as ChatGPT, GitHub Copilot, AlphaCode, Bard and DALL-E, among other tools. As the promise of incorporating these generative tools in the corporate setting is all but assured in the near term, there are a number of risks that need to be minimized as companies more forward. In particular, as AI applications grow increasingly sophisticated, they raise concerns with several forms of intellectual property (IP), such as patents, copyrights, and trade secrets. This article aims to discuss these issues and provide a sample company policy for using AI-generated content such as software code.

Brands — legally protected as trademarks — have value. We all understand that intuitively. Registering brands as federal trademarks also provides significant legal benefits, such as the presumption of ownership, validity, and nationwide priority in the mark. According to a recent study, the number of trademarks a company registers in a given year helps predict that company’s profitability and stock returns for the following year.

As I described in my previous article about the protocol for clean room product development, there are often situations where a company has come into contact with intellectual property that it cannot allow to spread to a product in development. In that article, I described the concepts of a clean room. In this article, I describe the practical implementation details. Once a clean room protocol has been set up, the following sections describe the recommended procedure to implement.

Brand owners frequently encounter significant challenges in obtaining federal trade dress registration. The recent ruling in the Eastern District of Virginia confirmed that TBL Licensing, LLC, the brand owner of Timberland boots, was not an exception to this struggle. Unlike a word mark, a product design can never be inherently distinctive as a matter of law because consumers are aware that such designs are intended to render the goods more useful or appealing rather than identifying their source. Wal-Mart Stores, Inc. v. Samara Bros., Inc., 529 U.S. 205, 212-213 (2000). In order to obtain a federal trademark registration for a product design, the applicant must establish secondary meaning.

There are often situations where a company has come into contact with intellectual property that it cannot allow to spread to a product in development. One example is a joint development project between two companies where the IP for the jointly developed product cannot seep into other products but where each company must develop products that interface with the jointly developed one. This situation can occur when groups create standards that involve IP from various sources.

Although the mining and metallurgical sectors are still seen as environmentally unfriendly industries, innovation in these sectors has been increasing since the beginning of the century, including in the development of green technologies. Four years ago, the World Intellectual Property Organization (WIPO) released a study measuring innovation in the mining industry with patents, “Mining patent data: Measuring innovation in the mining industry with patents”, showing a sharp increase in the number of correlated patent applications since 2005, which is a clear sign of the growth in investments in R&D and innovation made by these industries.

In January of this year, the Federal Trade Commission (FTC) proposed a new rule that would ban employers from using noncompete clauses for their employees. In an announcement, the FTC said that the use of noncompete clauses is “a widespread and often exploitative practice that suppresses wages, hampers innovation, and blocks entrepreneurs from starting new businesses.” The agency estimated the new rule could increase wages by $300 billion a year, as firms would be encouraged to do more to keep their workers. The proposed rule change was opened for public comment in January, and the deadline for submissions was extended from March 20 to April 19 in early March. As of April 18, the Regulations.gov website indicated that 24,259 comments had been received and 14,946 posted. With the comment period coming to a close this week, the U.S. Chamber of Commerce has weighed in, urging April Tabor, FTC Secretary to withdraw the proposed rule.

The simplest facts are sometimes the most difficult to comprehend. Patent suits are not as pervasive as they are portrayed in the media or by defendants. Remarkably few are filed relative to the number of patents that are active. The necessity to litigate patent disputes to get the attention of potential infringers and hold a meaningful licensing discussion has likely increased the total number of suits filed. If it has, it has not had much of an impact on the net total. This suggests that many patent holders who should be suing are not.

In commercial contracts, especially with foreign entities, it is very common to agree on arbitration as a dispute resolution method. A typical arbitration agreement specifies arbitrable matters, arbitration institution, place of arbitration, and arbitration rules. In crafting an arbitration agreement, especially when the arbitration clause is embedded in the main body, contracting parties normally write into the contract the applicable law and dispute resolution authority for the main contract, but rarely do the same for the arbitration agreement itself in addition to the main contract. In general, if a dispute involves issues surrounding the validity (or arbitrability) of an arbitration clause, whereas the arbitration agreement does not provide anything about arbitrability, two questions may come up in practice: (1) what is the applicable law on resolving the arbitrability issue? (2) who has jurisdiction over the arbitrability issue – a court or an arbitration institution?

Resources such as marketing and branding agencies can help new businesses struggling to find a unique brand name, and lawyers specializing in trademark law can help evaluate infringement and refusal risks and assist in registering a trademark. That said, the costs associated with each of these options are not insignificant, leading some smaller brands and startups to choose a name, do a quick internet search for prior use, and just hope they don’t face repercussions. One of the many issues with this is that as a new business grows and becomes more recognizable, the increased exposure makes it easier for someone with pre-existing rights to find and enforce those rights against the new business. This could include financial penalties and a complete rebrand of the business causing confusion to established customers, which is why choosing and trademarking one’s brand name early is vital. Insert Artificial Intelligence (AI). I