{"id":118137,"date":"2020-01-23T07:15:11","date_gmt":"2020-01-23T12:15:11","guid":{"rendered":"https:\/\/ipwatchdog.com\/?p=118137"},"modified":"2020-01-22T13:28:03","modified_gmt":"2020-01-22T18:28:03","slug":"trademark-litigation-review-happened-2019-watch-year","status":"publish","type":"post","link":"https:\/\/ipwatchdog.com\/2020\/01\/23\/trademark-litigation-review-happened-2019-watch-year\/id=118137\/","title":{"rendered":"Trademark Litigation Review\u2014What Happened in 2019 and What to Watch This Year"},"content":{"rendered":"
From Brunetti<\/em> to Lucky Brand Dungarees<\/em>, here are the trademark cases that will impact IP practice this year.<\/p>\n<\/div>\n <\/a>Two things are true about the world of trademarks\u2014it is rarely boring, and something is always on the horizon.<\/p>\n The following are some of the significant trademark decisions of 2019, as well as two critical cases to watch as 2020 begins:<\/p>\n 1. The Supreme Court\u2019s ruling in<\/strong> Iancu v. Brunetti<\/em><\/strong><\/a> rejected the Lanham Act\u2019s ban on offensive marks on the grounds that such a ban violates the First Amendment Right of Free Speech. The case involved clothing brand FUCT, which stands for \u201cFriends You Can\u2019t Trust,\u201d and its founder, Erik Brunetti, who sought to register the brand\u2019s name with the U.S. Patent and Trademark Office (USPTO). The USPTO refused to register the name, determining it was immoral and scandalous. Brunetti argued to the Trademark Trial and Appeal Board (TTAB) that the mark was not vulgar, and that Section 2(a) of the Lanham Act was unconstitutional because it violated the First Amendment. However, the TTAB affirmed the USPTO\u2019s refusal and Brunetti appealed to the U.S. Court of Appeals for the Federal Circuit (CAFC).<\/p>\n The CAFC found that the USPTO decision to bar Brunetti\u2019s trademark registration was unconstitutional on free speech grounds. The Supreme Court granted certiorari to determine the validity of Section 2(a) and decided 6-3 that the Lanham Act\u2019s bar on immoral or scandalous marks is viewpoint discrimination rather than viewpoint neutral and is thus unconstitutional. The Iancu v. Brunetti<\/em> ruling essentially does for offensive trademarks what the Supreme Court\u2019s 2017 Matal v. Tam<\/em><\/a> ruling did for trademarks that disparage particular groups.<\/p>\n 2. In<\/strong> Mission Product Holdings, Inc. v. Tempnology, LLC<\/em><\/strong><\/a>,<\/strong> the Supreme Court ruled that a trademark licensee does not lose all rights to use a licensed trademark when the licensor declares bankruptcy and rejects the contract. The court\u2019s decision means that a licensor\u2019s rejection of a trademark license constitutes a contract breach, but it does not end the licensee\u2019s rights to use the trademark.<\/p>\n Mission Product Holdings held a license to use Tempnology\u2019s \u201cCoolcore\u201d trademarks. When Tempnology filed for Chapter 11 bankruptcy, it attempted to reject the license with Mission. The First Circuit Court of Appeals ruled that the company was within its rights to reject the license, especially since allowing the license to continue would place a burden on Tempnology to monitor its marks and licenses after bankruptcy. \u00a0However, the Supreme Court sided with Mission stating that a declaration of bankruptcy and subsequent rejection of a contract does not mean that the licensee loses all rights to use a licensed trademark.<\/p>\n Since non-debtor licensees retain some rights post rejection, this ruling may affect the way practitioners draft trademark licensees in anticipation of bankruptcy.<\/p>\n 3. A regional retail chain scored a nearly nine-figure trademark infringement verdict<\/strong> against Walmart.<\/strong><\/p>\n In the North Carolina case of Variety Stores v. Walmart<\/em><\/strong><\/a>, Variety Stores Inc. (which operates the Roses and Maxway discount stores in the South), sued the retail giant over Walmart\u2019s use of the \u201cBackyard Grill\u201d brand. Variety said it had used the \u201cBackyard\u201d trademark for its lawn, garden and outdoor grilling products for nearly 30 years.<\/p>\n A U.S. District Court for the Eastern District of North Carolina jury awarded Variety more than $95.5 million in February, after finding in late 2018 that Walmart had willfully infringed the trademark.<\/p>\n Ironically, the jury verdict came a few months after the Fourth Circuit overturned the District Court judge\u2019s $32.5 million ruling in favor of Variety, stating that the case should have gone to a jury.<\/p>\n 4. Another retail battle involved Tiffany\u2019s ongoing trademark dispute<\/strong> against Costco.<\/strong> In January, a District Court for the Southern District of New York judge rejected Costco\u2019s request to overturn Tiffany & Co\u2019s $21 million verdict in the case of Tiffany & Co. v. Costco Wholesale Corp<\/em><\/strong><\/a>.<\/p>\n The lawsuit alleges that Costco violated Tiffany\u2019s trademark by using \u201cTiffany\u201d signage to promote the store\u2019s diamond ring collection. Costco claimed that the usage was simply a reference to \u201cTiffany setting,\u201d a generic jewelry industry term, but the federal court rejected that defense. The judge in the case ruled that not only did Costco violate Tiffany\u2019s trademark, but that the retailer also engaged what amounts in counterfeiting by doing so.<\/p>\n Costco is appealing that decision to the Second Circuit, and a decision should be forthcoming in 2020.<\/p>\n 5. Next up on the Supreme Court\u2019s agenda<\/strong> is determining if a finding of willfulness is required to obtain an aware of profits in trademark infringement litigation.<\/strong><\/p>\n