Maryland Intellectual Property Law Blog : Maryland Intellectual Property Lawyer & Attorney : Brian Wm. Higgins : Serving Baltimore, Columbia, Frederick

          The National Football League (NFL) Properties, Inc. and Electronic Arts (EA), maker of, among other computer video games, "Madden NFL 11," were sued by Frederick Bouchat for allegedly infringing his copyright in his "Flying B" artwork (pictured at right).  Filed in the U.S. District Court for the District of Maryland (No. 11-CV-02878, Oct. 7, 2011), Bouchat alleges in his complaint that the NFL licensed the infringing logo to EA and then EA reproduced and displayed it on "retro" uniforms worn by players depicted in its video game.

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          By an overwhelming vote of 95-5 in favor of reforming U.S. patent laws, the Senate on March 8, 2011, passed S.23, the America Invents Act, originally dubbed the "Patent Reform Act of 2011" when it was introduced January 25, 2011.  The bill, as amended, is now headed to the House where it is likely to be further amended when it reaches the House Judiciary committee (or replaced with a companion bill introduced in the House).

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    Patent reform is once again on the Senate Judiciary Committee's legislative agenda.  S.23--the Patent Reform Act of 2011--was introduced on the Senate floor by Committee Chairman Patrick Leahy (D-VT) on January 25, 2011.  The bill, which resembles previous reforms, is co-sponsored by eight: three Republicans, four Democrats, and one Independent.

     In his introductory remarks on the floor, Leahy suggested that failing to pass patent reform this year would allow China to dominate the world in innovation activity.  Quoting a Newsweek study published last year, he said that only "41 percent of Americans believe that the United States is staying ahead of China on innovation. A Thompson Reuters analysis has already predicted that China will outpace the United States in patent filings this year. China, in fact, has a specific plan not just to overtake the United States this year in patent applications, but to more than quadruple its patent filings over the next 5 years." Leahy also called for reforming the patent system to "stimulate the American economy" through innovation.  He quoted Thomas Freidman, who wrote "We might be able to stimulate our way back to stability, but we can only invent our way back to prosperity."

     Senatory Orrin Hatch (R-UT), also speaking on the Senate floor in support of S. 23, noted that patent reform was needed to address the backlog of 700,000 patent applications pending in the Patent Office.  He said that number "reflects the vibrant, innovative spirit that has made America a world-wide leader in science, engineering, and technology, but also represents dynamic economic growth waiting to be unleashed."

     The current version of patent reform looks like previous ones.  A quick summary of the major provisions is shown below:

Sec. 1: Short Title
Sec. 2: First Inventor to File
Sec. 3: Inventor's Oath or Declaration
Sec. 4: Damages
Sec. 5: Post-Grant Review Proceedings
Sec. 6: Patent Trial and Appeal Board
Sec. 7: Preissuance Submissions by Third Parties
Sec. 8: Venue
Sec. 9: Fee Setting Authority
Sec. 10: Supplemental Examination
Sec. 11: Residency of Federal Circuit Judges
Sec. 12: Micro Entity Defined
Sec. 13: Funding Agreements
Sec. 14: Tax Strategies Deemed Within the Prior Art
Sec. 15: Best Mode Requirement
Sec. 16: Technical Amendments
Sec. 17: Effective Date; Rule of Construction

     What will be the fate of S.23?  If history is any indication, the reform measure may go the way of previous legislative attempts and end up scuttled before it gets much traction.  But at least this Congress is starting the process early.  Below is a list of previous Congressional attempts to reform the Patent Act and the fate of each bill.

111th Congress: S. 515 (Patent Reform Act of 2009: Dead)
111th Congress: S. 610 (Patent Reform Act of 2009: Dead)
111th Congress: H.R. 1260 (Patent Reform Act of 2009: Dead)
110th Congress: S. 1145 (Patent Reform Act of 2007: Dead)
110th Congress: S. 3600 (Patent Reform Act of 2008: Dead)
110th Congress: H.R. 1908 (Patent Reform Act of 2007: Passed House)
109th Congress: S. 3818 (Patent Reform Act of 2006: Dead)
 

     As it has in the past, the Biotechnology Industry Organization (BIO) came out in support of S. 23, with BIO President and CEO Jim Greenwood noting the legislation's benefits to bio: "Innovation in biotechnology is based upon the strong and predictable protection of intellectual property provided by our nation’s patent system. Without strong and predictable patent protection, investors would shy away from investing hundreds of millions of dollars, over a decade or more, in high-risk biotechnology companies, and will simply put their money into projects or products that are less risky or offer a more immediate return but are of less value to society."  Other stakeholders, as they have in the past, will undoubtedly step forward for or against the legislation.

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• Please visit the Maryland IP Jobs page for a list of Intellectual Property jobs in Maryland (if you would like to have an IP-related job in Maryland listed on this website--for free--please send me the information)
   
• Invotex Group's Michele Riley will be co-presenting a WEBINAR to the MD Bar Association - IP Section titled "Removing the Mystery: Damages in Intellectual Property Disputes" on Thursday, September 10, 2009 from 8:30 to 9:30 a.m.  For more information, click here. 
   
• A reader pointed out that in the case of Dayna Staggs v. Kanye West, No. 8:2008cv00728 (filed March 20, 2008), the U.S. District Court for the District of Maryland granted in part and denied without prejudice in part Defendant The Island Def Jam Music Group, a division of Universal Music Group's motion to dismiss (memorandum opinion; entered August 17, 2009).  In doing so, the Court, reviewing Plaintiff's copyright infringement claim, found "it it is by no means clear that Staggs would be able to establish that the Universal Defendants had access to his Song ["Volume of the Good Life"], [but] for purposes of the Motion to Dismiss, since Staggs has alleged that [Kanye] West had access to it through his MySpace page, and since the Universal Defendants could conceivably have had access through West, the Court finds that this element is satisfied." Notwithstanding, the Court also found that, "as a matter of law, there is no substantial similarity between the songs ["Volume of the Good Life" and West's "Good Life"]."

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     On September 10, 2008, Senator Ben Cardin (D-MD) added his support to S. 3325, the Enforcement of Intellectual Property Rights Act of 2008, one day before the Senate Judiciary ordered the bill "to be reported with amendments favorably." Cardin joins eight other co-sponsors of the legislation (Senators Leahy, Bayh, Cornyn, Hatch, Voinovich, Specter, Feinstein, and Whitehouse). Next stop for the bill in consideration by the entire Senate (once placed on the Senate Calendar).

• Enforcement of copyright laws

     S.3325, introduced July 24, 2008, would authorize the U.S. Attorney General to commence a civil action against any person who engages in conduct constituting a criminal offense under the copyright laws, 17 U.S.C. § 506, upon proof of such conduct by a preponderance of the evidence (compared to the much high criminal standard, the preponderance standard is estimated to result in more enforcement of copyright laws). A person found liable may be subject to a civil penalty under section 504 which shall be in an amount equal to the amount which would be awarded under 18 U.S.C. 3663(a)(1)(B) (i.e., the amount of the loss sustained by each victim as a result of the offense, considering the financial resources of the defendant) and restitution to the copyright owner aggrieved by the conduct.

• Enforcement of trademark laws

     S. 3325 would enhance remedies for trademark violations. Section 35(b) of the Trademark Act of 1946 (15 U.S.C. 1117(b)) would require a court, in assessing damages for any violation of section 32(1)(a) of the Act, or or in a case involving use of a counterfeit mark or designation, to enter judgment for three times profits or damages, whichever amount is greater, together with attorney’s fee, unless the court finds extenuating circumstances. Treble damages and attorney's fees are authorized where the violation consists of:

(1) intentionally using a mark or designation, knowing such mark or designation is a counterfeit mark in connection with the sale, offering for sale, or distribution of goods or services; or

(2) providing goods or services necessary to the commission of a violation specified in paragraph (1), with the intent that the recipient of the goods or services would put the goods or services to use in committing the violation.

     The court may also award prejudgment interest beginning on the date of the service of the claimant’s pleadings and ending on the date entry of judgment is made.

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     Below are links to and highlights of recently published blog posts discussing current events relating to the Patent Reform Act of 2007 (s.1145). It appears from all accounts that Sen. Arlen Specter (R-Pa.), ranking minority member of the Senate Judiciary Committee, and his Republican caucus, may block pending patent reform legislation until there is a "fair and equitable treatment" on the confirmation of federal judges, and resolution of provisions concerning apportionment of damages for patent infringement.

• Patent Bill Hits Impass in the Senate, Wall Street Journal (April 18, 2008)

     Gret Hitt, noting that Patent Reform efforts appear to be stalled in the Senate due to an impass over provisions in S. 1145, quotes Sen. Leahy, Chairman of the Judiciary Committee, as saying, "This was a missed opportunity."

• S.1145: "Not dead, but on ice", IPBIZ (April 17, 2008)

     Quoting a Reuters report, Lawrence Ebert points out that Barack Obama and his patent advisor, Mark Lemley, favor patent reforms, while U.S. trade unions oppose the bill.

• US Patent Reform Stalls as Senate Negotiations Break Down, IP Watch (April 15, 2008)

      Describes how Sen. Leahy's plan to bring s.1145 to a vote was derailed when he failed to agree on several provisions with the panel’s ranking member, Sen. Arlen Specter.

• Cracks Forming in the Passage of Patent Reform Act, 271 Patent Blog (April 9, 2008)

     Peter Zura, one of the first to blog that Sen. Specter was pulling his support for s.1145, quoted a report stating that the Senator "cannot join" his colleagues "on some parts of the bill," citing apportionment of damages as a "principle sticking point."

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• #19: CoStar Realty Information, Inc. v. Field, No. 8:2008cv00663; filed March 13, 2008; assigned to J. Williams

     This copyright lawsuit involves Plaintiffs CoStar Realty Information, Inc., and CoStar Group, Inc., which are Delaware companies with their principal places of business in Bethesda, MD, and Defendants Mark Field (allegedly a California resident and sole proprietor d/b/a Alliance Valuation Group), Lawson Valuation Group, Inc. (allegedly a Florida entity), Russ Gressett (allegedly a Texas resident d/b/a TGC Realty Counselors), Gerald A. Teel Company, Inc. (allegedly a Texas entity), and John Does 1-5. 

     Plaintiffs assert that they provide users with access to one of the most comprehensive commercial real estate information databases available. Alliance reportedly entered into a Licensing Agreement with CoStar to access CoStar's databases, but allegedly breached the agreement by providing user names and passcodes to Defendants Lawson, Gressett, Gateel, and Does 1-5. CoStar asserts, against one or more defendants, copyright infringement, criminal copyright infringement, breach of contract, fraud, and tortious interference with contract and prospective business relationship. With regard to the copyright infringement allegation, CoStar is seeking an award of statutory damages, as well as attorney's fees and costs.

     Shari Ross Lahlou of Crowell & Moring (Washington, DC) filed the complaint on behalf of CoStar.

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     The following Notice concerning patent reform was posted on the USPTO website today. Clearly, the Bush Administration is concerned about a potential vote on the Senate's version of the Patent Reform Act of 2007 (S.1145), which was placed on the Senate Calendar in late January. In a letter to Sen. Leahy, dated today, Nathaniel Wienecke, Assistant Secretary of Commerce for Legislative and Intergovernmental Affairs, writes:

"The Administration continues to oppose Section 4, "Right of the Inventor to Obtain Damages." Consequently, we continue to oppose S. 1145 - in its entirety - unless Section 4 is significantly revised, as we believe the resulting harm to a reasonably well-functioning U.S. intellectual property system would outweigh all the bill's useful reforms.

* * *

"Downstream litigation costs can be minimized through patent clarity - offered through such early elucidation mechanisms as applicant quality submissions and post-grant procedures. Flexibility in assessing damages ensures that results can be tailored, avoiding a "one-size-fits-all" approach that pleases no one."

     The entire Notice, which involves a media call tomorrow, is after the jump...

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     A few weeks ago I posted "Congress and Copyrights: A Busy Legislative Year," in which I summarized three Congressional bills targeting copyright infringement/infringers:

• The Intellectual Property Enhanced Criminal Enforcement Act of 2007 (H.R. 3155-IH),
  
  
• The Intellectual Property Enforcement Act of 2007 (S.2317), and
  
  
• The College Opportunity and Affordability Act of 2007 (H.R.4137). 

     Last week, Congress was at it again, with the introduction of yet more legislation amending the Copyright Act, as summarized below.

• Prioritizing Resources and Organization for Intellectual Property ("PRO IP") Act of 2007

H.R.4279 was introduced in the House on December 5, 2007, by Rep. John Conyers (D-MI). The bill would, among other things, amend 17 U.S.C. § 410 by adding a new paragraph (c)(1): "A certificate of registration satisfies the requirements of section 411 and section 412 regardless of any inaccurate information contained in the certificate, unless (A) the inaccurate information was included on the application for copyright registration with knowledge that it was inaccurate; and (B) the inaccuracy of the information, if known, would have caused the Register of Copyrights to refuse registration." 

The bill would also amend § 504 as follows:

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Summary:  Seeking only minimal recognition for his Baltimore Ravens logo design, Baltimore amateur artist ends up seeking certiori from the Supreme Court in his copyright infringement case, winds up with no damages award

     So how much is an NFL franchise team logo worth? Just ask Frederick Bouchat, who sued the Baltimore Ravens and the National Football League Properties (NFLP) over their use and licensing of a logo that closely resembled a drawing Bouchat faxed the Ravens back in 1995. All Bouchat asked in return was a letter of recognition and an autographed helmet, a small reward from a team and League making millions in revenues at the time.

     After a lengthy bifurcated copyright infringement trial, the District Court for the District of Maryland found that the Ravens had infringed Bouchat's copyrighted work. The Court of Appeals for the Fourth Circuit affirmed the trial court decision. His damage award, however, was zero (and he's still waiting for his recognition letter and autographed helmet). Bouchat then sued the NFL's licensees, and won again. However, he was not so lucky when it came to seeking damages.

     Under 17 U.S.C. § 504(a)(1), a copyright owner may seek actual damages plus any additional profits of the infringer. Under 17 U.S.C. § 504(c)(1), an award of statutory damages may be made "in a sum of not less than $750 or more than $30,000."

     In this case, Bouchat had little actual damages (he was not making any products using the logo himself), so he sought profits from the Ravens and dozens of NFLP licensees who were selling myriad items containing the "Flying B" logo. The jury found that defendants' income from products containing the Flying B were attributed completely to factors other than the artwork itself, and therefore did not award Bouchat any damages. Moreover, Bouchat was not entitled to an award of statutory damages because he had not registered his copyrighted work before the Ravens' and licensees' infringing conduct began:

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