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This week in IP: German injunction test splits counsel, SCOTUS preserves BPCIA, Miley Cyrus secures EUTM

Managing IP rounds up the latest patent, trademark and copyright news, including some stories you might have missed

Counsel split on codified German injunction test

In-house counsel revealed to Managing IP this week that they are divided on updates to German patent law that codify the principle of injunction proportionality.

Last week, Germany’s parliament voted in favour of reforms to the patent law which included a proportionality test for automatic injunctions.

Under the new law, judges are given discretion on whether to apply an injunction on the basis that it would cause an alleged infringer or third party undue economic hardship.

Sources from the automotive industry say they hope the changes will protect them from the undue hardship of an injunction, but standard essential patent owners in the telecoms industry suspect litigation will continue as usual.

“I don’t expect big changes from this law,” says a patent litigator for an international telecoms company.

“The parliament made it very clear they only want the proportionality test in exceptional cases. The hurdles are still very high and the defendants have to state quite a lot to get this exception.”

Click here to read the full article.

Other Managing IP stories published this week that you may have missed include:

How brands monitor and clear apps for trademark issues

Counsel: job hoppers spark China trade secrets challenges

Lawyers predict how office life is about to change

Crossed wires: telecoms and tech counsel reveal licensing lows

Missed deadlines: where things stand with the EU Copyright Directive

Performance review: UK lawyers evaluate new IP judges

SCOTUS H&M ruling could ‘encourage or curtail’ copyright trolls

Four ways in-house hone solid design patent strategies

SCOTUS rejects Obamacare challenge, ending threat to BPCIA

The US Supreme Court rejected another challenge to the Affordable Care Act yesterday, June 17, ending the possibility of dismantling the Biologics Price Competition and Innovation Act.

The BPCIA, which sets out a process for identifying disputes over patent infringement and includes a framework for managing ensuing litigation once an applicant seeks a biosimilar licence, was passed under the ACA.

There was concern after Justice Amy Coney Barrett joined SCOTUS last year that a more conservative-leaning high court would strike down both acts.

But the court ruled seven to two in California v Texas, in which Coney Barrett was one of the majority justices, that neither the states nor the individuals challenging the ACA mandate had a legal right to sue, also known as standing.

The justices did not reach the main issue in the case of whether the entirety of the ACA should be rendered unconstitutional because Congress set the mandate tax penalty to zero.

The ACA originally set out that most US citizens should have health insurance and had to pay a tax penalty for enrolling for Obamacare, unless they were exempted from that penalty.

The case was first filed as Texas v California at the District Court for the Northern District of Texas in 2018. The court held that the individual mandate was a critical provision of the ACA and that, without it, some or all of the ACA was potentially unconstitutional.

On appeal, the Court of Appeals for the Fifth Circuit agreed with the district court, arguing that because the penalty for not obtaining health insurance was now zero, the current version of the mandate was unconstitutional.

But the appellate court said the case should go back to the district court, instructing it to take another look at whether the entire ACA was invalid.

After the appellate ruling, both Texas and California petitioned to SCOTUS to have the case heard. The court consolidated California v Texas and Texas v California when it accepted these petitions.

IP counsel will likely be pleased at the outcome. Had the BPCIA been dismantled, biosimilar makers would have had to have gone through much longer and more expensive regulatory and IP-related processes.

'Miley Cyrus' can be registered as EUTM, says General Court

US singer Miley Cyrus has won the right to use her name as a trademark on a wide range of products in the EU, it emerged this week.

In a decision handed down on Wednesday, June 16, the EU General Court backed the singer’s attempt to register ‘Miley Cyrus’ as an EU trademark (EUTM).

The ruling overturns a decision by the EUIPO’s opposition division and another by the office’s Fourth Board of Appeal (BoA).

Both the opposition division and the BoA agreed with arguments from Cyrus Trademarks, owner of a 2010-registered EUTM for ‘Cyrus’, that the application should be denied for most of the goods and services applied for because it could cause confusion and had no conceptual meaning.

But the General Court said the ‘Miley Cyrus’ EUTM had “clear and specific semantic content” for the relevant public, given that it referred to a public figure of international reputation.

“The reputation of the singer and actress Miley Cyrus is such that it is not plausible to consider that, in the absence of specific evidence to the contrary, the average consumer, confronted with the mark ‘Miley Cyrus’, will disregard the meaning of that sign as referring to the name of the famous singer and actress.”

The case dates back to 2014 when the singer's company Smiley Miley sought to trademark her name for audio and video discs, mobile phone cases, e-books, electronic board games, calendars and other goods.

Senate Judiciary Committee advances Cunningham nomination to Federal Circuit

The Senate Judiciary Committee advanced Tiffany Cunningham’s nomination to the Court of Appeals for the Federal Circuit yesterday, June 17, bringing her closer to becoming the first black judge on the US’s top patent court.

Cunningham, partner at Perkins Coie in Chicago, was approved by 16 committee members to six during an executive business meeting at the Hart Senate Office Building.

“Miss Cunningham has exceptional credential to serve on the bench,” said Senator Dick Durbin during the confirmation meeting, shortly before Cunningham’s nomination was advanced.

“She has been an intellectual property litigator for almost two decades, working on every aspect of patent litigation from the inception of a case through to discovery, trial and appeal.

“The American Bar Association has rated Miss Cunningham unanimously as well qualified,” he added. 

The next step for Cunningham is a confirmation vote by the full Senate. It could take place as soon as next week.

Sources told Managing IP in April, shortly after Cunningham was nominated to the Federal Circuit, that she could bring much-needed predictability to the appellate court.

List of top 100 universities for patents revealed

The National Academy of Inventors and the Intellectual Property Owners Association published a list of the global top 100 universities for patents on Tuesday, June 15.

The list drew on data from the USPTO for filings of utility patents. At the top was the Regents of the University of California, with 597 patents.

The Massachusetts Institute of Technology came in second with 383 patents. Stanford University was third with 229.

The first non-US university was Tsinghua University in Beijing, which filed 155 patents. Saudia Arabia's King Fahd University of Petroleum and Minerals (127) and the Korea Advanced Institute of Science and Technology (86) were other non-US universities that featured.

The rankings have been reported annually since 2013, and according to a press statement released by the National Academy of Inventors, the list “highlights the vital role patents play in university research and innovation”.

Paul Sanberg, president of the National Academy of Inventors, said: “The institutions included in this year's report are leading innovation worldwide through their encouragement of academic discovery and invention.

“We are proud to collaborate with the IPO for the ninth consecutive year to highlight universities that have made critical contributions to society." 

This year’s list of 100 top universities had an aggregate of 7,734 patents spanning numerous industries, including medicine, engineering, and technology.

The Jesus and Mary Chain sue Warner Music for copyright infringement

Scottish rock band The Jesus and Mary Chain filed a copyright lawsuit against Warner Music Group in the US on Monday, June 14. 

Members of the band Jim Reid and William Reid alleged that Warner Music had refused to relinquish ownership of the group’s earlier works, including the 1985 debut album 'Pyschocandy'.

The brothers filed the suit in the District Court for the Central District of California, asking for $2.5 million in damages.

Central to the case is Section 203 of the Copyright Act of 1976, which allows artists to terminate grants of copyright ownership 35 years after publication.

In January 2019, the band’s attorney sent a notice of termination to Warner, asking the company to relinquish the copyright to several albums along with various singles and extended plays.

A lawyer for Warner’s Rhino label responded to the Reids’ request late last year in a letter, saying: “WMG is the owner of the copyrights throughout the world in each of the sound recordings comprising the noticed works, and the notice is not effective to terminate WMG’s US rights.”

The letter also stated that the brothers and their former bandmate Douglas Hart had agreed that the predecessor of Warner Music Group – Warner Elektra Atlantic – was the maker of all the band’s recordings and thus the original owner of all the copyright to the band’s music.

In a statement, the band’s lawyer said: “Despite the law returning the US rights to the band, WMG is continuing to exploit those recordings and thereby wilfully infringing upon our clients’ copyrights. This behaviour must stop. The legal issues in this suit are of paramount importance to the music industry.”

Hasbro wins Game of Life copyright case

The US Court of Appeals for the First Circuit ruled in Hasbro’s favour in a copyright dispute against the heirs of the Game of Life designer Bill Markham on Monday, June 14.

In a decision upholding an earlier ruling from the District Court for the District of Rhode Island, the appellate court determined that the board game was a work for hire under the Copyright Act of 1909.

This meant that Markham’s heirs did not possess the termination rights that would allow them to reassert control over the copyright.

The appellants argued that the Copyright Act limited works for hire to those produced under a traditional employer-employee agreement, rather than commissioned works, such as Game of Life.

The First Circuit said its own precedent contradicted this argument. In Forward v Thorogood, the court had applied a test – which gave a presumption of ownership to the commissioning party who bore the expense – to a tape recording governed by the Copyright Act.

The appellants also argued that the cost of the work was not incurred by the man who approached Markham to design the game. This man, Rueben Klamer, came up with the initial concept of the game.

But the First Circuit said that the evidence supported the argument that the game was created at Klamer’s expense.

Additionally, Markham’s heirs claimed that an assignment agreement between Markham and toy company Link Research – which Klamer co-founded – rebutted the presumption that the game was a work for hire.

But the court found that the language in the agreement was not sufficient to overcome this presumption.

Markham had previously clashed with Klamer over who deserved credit for creating the game. Markham, who passed away in 1993, felt he was not given sufficient credit.

Second Circuit says 1-800 Contacts settlement agreements competitive

The US Court of Appeals for the Second Circuit has overturned a Federal Trade Commission decision that online contacts retailer 1-800 Contacts had violated antitrust laws in its trademark settlement agreements.

On Friday, June 11, the court ruled that trademark agreements were not immune from antitrust scrutiny, but that the FTC had incorrectly concluded that the agreements in this case were a form of unfair competition.

The contacts business did not want search engines to show rival companies’ paid adverts when users searched for 1-800 Contacts.

It had reached reciprocal settlement agreements that prohibited competitors from using 1-800 Contacts’ trademarks, URLs and variations of trademarks as search advertising keywords.

The agreements also required parties to bid on negative keywords, which are those that prevent competitors’ ads from showing up when they are searched. Likewise, 1-800 Contacts would bid on negative keywords for its competitors’ trademarks.

The Second Circuit said the FTC bore the burden of establishing a prima facie case for the anti-competitive effect of these agreements.

The FTC argued that it had established direct evidence of anti-competitive effect in the form of increased prices.

But the Second Circuit said the FTC had failed to meet this burden.  

The contact business also argued that protection of its trademark rights was a pro-competitive effect of its settlement agreements. The Second Circuit agreed with this argument.

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