ICANN revealed the new gTLD applications today; were any infringements to your Brand revealed?

Today is ICANN’s Reveal Day for the new generic top level domain (gTLD) applications. Common gTLD’s include .com, .net, .org, and country-specific domain name extensions such as .uk (United Kingdom) or .ca (Canada). The new gTLD extensions are referred to as “strings.”  ICANN published its list of applied-for gTLD strings here. You can download a PDF version of the list here.  You can search for strings of interest here.

          

Now that the gTLD application list has been published, a public review period has begun, including a 2-month comment period and a 7-month formal objection period.  ICANN permits a few objections anyone can raise(applicants and non-applicants). 

            

The “Legal Rights Objection” will likely be the most useful and relevant for purposes of brand protection.  Once a Legal Rights Objection is filed, an independent panel of one or three experts will decide whether the applied-for gTLD string would be likely to infringe an existing trademark, intergovernmental organization name, or another acronym in which an entity has a cognizable right.

            

The panel will decide whether the applied-for gTLD takes unfair advantage of the objecting party’s mark or name, whether it unjustifiably impairs the distinctive character or reputation of the objecting party’s mark or name, or whether it creates a likelihood of confusion with the objecting party’s mark or name.  To make these determinations, the panel looks to various non-exclusive factors, including, whether the applied-for gTLD is identical or similar in appearance, sound or meaning to the objecting party’s mark or name, and whether the intended use of the applied-for gTLD will create a likelihood of confusion with the objecting party’s mark or name as to the source, sponsorship, affiliation, or endorsement of the gTLD.

            

Trademark and brand owners should take the time on the front end to challenge any gTLD strings that may be encroaching on their trademark or brand names.  We think that the effort put into challenging objectionable gTLD strings now could pay huge dividends in the future, especially considering the time and cost of after-the-fact trademark litigation, UDRP proceedings, and ad hoc brand enforcement and protection.

Authors:

Hamad Hamad

Jason Mueller

Jason Nardiello

Wax Wars! Maker’s Mark v. José Cuervo – Is Melty Wax a Trademark? Or a Pretty Seal Available for All to Use?

Is wax coating on bottles of liquor a trademark?  Or is it a pleasing way to make the liquor look “artisanal”?  If your company sells products symbolized by a unique and visually attractive graphic or ornamental device, you should care about this question.

On December 2, two heavyweights in the hard liquor industry (we’ve heard of “Big Oil,” but is there such a thing as “Big Booze”?) argued before the U.S. Court of Appeals for the Sixth Circuit.  The legal issues:  (1) whether a melted wax seal on José Cuervo’s $100 reserve tequila infringed Maker’s Mark’s registered design trademark for “wax-like coating covering the cap of the bottle and trickling down the neck of the bottle in a freeform irregular pattern” on whiskey bottles; and (2) whether the use of dripping wax over the cap of a bottle of spirits is “aesthetically functional.”  Here are the two bottles:

Some courts have held that if a design element is so aesthetically pleasing that it makes customers want the item, one company cannot claim that design element as a trademark and keep others from using it, because that would put competitors at a disadvantage.  This notion of “aesthetic functionality,” however, is a controversial topic.  Earlier this year, we reported on a Ninth Circuit opinion that images of Betty Boop on clothing and handbags was unprotectable because it was aesthetically functional induced raised eyebrows and raised voices in the trademark world.  After the outcry, the Ninth Circuit quietly changed its ruling to sidestep the issue.

In the Maker’s Mark vs. José Cuervo case, aesthetic functionality is front-and-center once again, with Cuervo claiming that the “hand-dipped wax seal” look helps create an artisanal image that helped to sell its luxury tequila at $100 per bottle.  Cuervo has marshaled evidence that artisanal producers of alcoholic beverages have used hand-dipped wax seals for centuries (and still do).  Cuervo also argues that its bottle not only looked different from Maker’s Mark’s whiskey bottle, but prominently displayed the Cuervo brand—and that at $100 a pop, its customers would be well-aware that they weren’t buying Kentucky bourbon.  Maker's Mark relied on decades of advertising focusing consumers on the wax seal as creating an indelible association with its brand.

The Sixth Circuit is likely to issue its ruling in the next 6-8 months, and it’s certain that one side won’t be toasting the outcome.  If the court finds these wax seals aesthetic functional, then trademark law would not be able to stop consumer brand confusion.  But if the court rejects aesthetic functionality, then Maker’s Mark would have a de facto monopoly on that type of seal in the liquor business.  A real trademark law quandary.

In the meantime, however, owners of attractive packaging designs that could be attacked as aesthetically functional would be wise to shore up their trademark bona fides by, for example, use of advertising specifically calling attention to the attractive design element—be it packaging, product shapes, or product color combinations—that uniquely identifies the brand owner and drives sales. 

Authors:  Tom Casagrande    Paul Van Slyke

New Model Order Limiting e-Discovery Can Substantially Lower Cost of Trademark and Advertising Litigation

A great weakness of the United States Court system is its discovery expense.  A new model court order can be adapted to trademark and advertising cases to sharply reduce the costs of the e-discovery part of these expenses.

In most cases, parties are brought to their knees by the discovery expense of federal litigation and forced to settle early without a full trial on the merits.  Increasingly, many parties balk at pursuing courtroom justice at all because of the specter of discovery expense.  In complex cases such as trademark infringement and advertising deception, discovery of electronic data (e-discovery) adds dramatically to the cost of this expense.

The Model Order and Its Limitations

Chief Judge Randall Rader of the U.S. Court of Appeals for the Federal Circuit, speaking at a bar conference, recently proposed a model order that places dramatic limits on e-discovery in patent cases.  This model order is easily adaptable to other kinds of cases and can be a powerful tool to limit the cost and inconvenience of e-discovery in trademark and advertising litigation.    

The model order places much tighter and more specific constraints on discovery of electronically stored information ("ESI") than those currently provided by the Federal Rules of Civil Procedure.  Some of the key limitations of the model order include:

• Exclusion of peripheral metadata from general ESI production requests absent a showing of good cause.

• Exclusion of email from “general” ESI requests.  To obtain email, parties must specifically request it.

• Email production requests are limited to specific issues, rather than general discovery of a product or business.

• Email production requests must identify the custodian, search terms, and time frame. 

• Limit of five custodians per producing party for email requests, with up to five additional custodians upon agreement among the parties or a showing of “distinct need” based on the size, complexity and issues of the specific case.

• Limit of five search terms per custodian per party, with search terms narrowly tailored to specific issues in the case.  No indiscriminate terms, such as the producing company’s name or its product name are permitted, unless combined with narrowing search criteria that sufficiently reduce the risk of over production.

Adapting the Model Order for Trademark and Advertising Cases

The model rule can be tailored to the specific issues in trademark and advertising cases.  For example, in a trademark infringement case, email production requests could be phased to occur after the parties have exchanged basic documentation about the trademarks, the products accused of infringement, and the relevant product sales. In false and deceptive advertising cases, email production requests could be phased to occur after the parties have exchanged basic documentation about the advertising, the advertising media, the ad agency file, and the profile of the target consumers. 

Effect of Using Adaptation of the Model Order

Having these limitations in a court order issued at the outset of litigation will help curb unnecessarily burdensome and costly requests for irrelevant material.  By laying out specific stipulations regarding what can and cannot be requested, ESI production will be more useful, more focused, and less wasteful.

Authors:  Paul C. Van Slyke       Tom Casagrande