Bloomberg News

Apple, Urban Outfitters, Foschini: Intellectual Property

January 24, 2013

Apple Inc. (AAPL:US) founder Steve Jobs suggested the computer maker collude with Palm Inc. to prevent the companies from hiring employees away from each other, according to a court filing in an antitrust lawsuit.

In 2007 Jobs called Edward T. Colligan, who was then Palm’s chief executive officer, to propose the arrangement and during that call suggested that if Palm didn’t agree, Apple might file patent-infringement claims against it, according to the filing Jan. 22 in federal court in San Jose, California.

The declaration by Colligan was filed in a lawsuit claiming the iPhone maker and other technology companies violated antitrust laws by entering into agreements to not recruit each other’s employees. The other defendants in the case include Google Inc. (GOOG:US), Intel Corp. (INTC:US), Adobe Systems Inc. (ADBE:US), Walt Disney Co. (DIS:US)’s Pixar animation unit, Intuit Inc. (INTU:US) and Lucasfilm Ltd.

Colligan rejected Jobs’s proposal in an Aug. 24, 2007 e- mail saying his idea is “not only wrong, it is likely illegal,” and the threat of patent litigation is “just out of line,” according to the filing.

Jobs, who died in October 2011, responded by saying Colligan’s response wasn’t “satisfactory” to Apple because Palm was actively recruiting Apple employees.

“My advice is to take a look at our patent portfolio before you make a final decision here,” Jobs wrote in an e- mail, a copy of which was attached to the Jan. 22 filing.

Kristin Huguet, a spokeswoman for Cupertino, California- based Apple, didn’t immediately respond to an e-mail after regular business hours Jan. 22 seeking comment on the filing.

Last week, Tim Cook, Apple Inc.’s chief executive officer, was ordered to give a deposition in the private lawsuit brought on behalf of employees. The case mirrors claims the companies settled with the U.S. Justice Department in 2010 following a probe, arguing the companies agreed to refrain from placing “cold calls” to lure workers from competitors.

In the 2010 settlement, the Justice Department said the companies kept do-not-call lists to avoid competitive recruiting, and that such agreements restrained competition, which hurt employees.

Palm was acquired by Hewlett-Packard Co. (HPQ:US) in 2010. Michael Thacker, a spokesman for that company, didn’t immediately respond to an e-mail yesterday after regular business hours seeking comment on the filing.

The San Jose case is In Re High-Tech Employee Antitrust Litigation, 11-2509, U.S. District Court, Northern District of California (San Jose). The previous case is U.S. v. Adobe Systems, 10-cv-1629, U.S. District Court, District of Columbia (Washington).

For more patent news, click here.

Trademark

Urban Outfitters Loses Bid to Transfer ‘Navajo’ Trademark Case

Urban Outfitters Inc. (URBN:US), the lifestyle specialty retailer based in Philadelphia, lost its attempt to move a trademark infringement case from Albuquerque, New Mexico, to Philadelphia.

The company was sued in March 2012 by the Navajo Nation, which is the largest Native American tribe in the U.S.

The suit is related to the retailer’s use of “Navajo” with products it has sold.

The Navajo Nation sent Urban Outfitters a cease-and-desist letter objecting to the use of the word “Navajo” on underwear and the sale of a flask wrapped in what was described as “Navajo Print Fabric.” The nation complained that the use of the word on underwear offended the tribe’s spiritual beliefs about modesty, and calling a flask “Navajo” was insensitive, given the ban on the sale and consumption of alcohol on the reservation.

Other items to which the Navajo Nation objected included an “Unknown Techno Navajo Quilt Oversized Crop Tee” and a “Truly Madly Deeply Navajo Print Tunic,” according to court papers.

In a Sept 2012 court filing, Urban Outfitters argues that the New Mexico court is inconvenient for everyone, including the Navajo Nation, which is headquartered in Window Rock, Arizona, according to the tribe’s website.

Urban Outfitters argued in its court papers that the federal court in Philadelphia was “particularly well-versed in intellectual property matters,” and that the case would be disposed of more expeditiously in Pennsylvania.

In a Jan. 16 order, U.S. District Judge C. LeRoy Hansen said that after considering Urban Outfitters’ arguments, “the balance of factors weighs against transfer.” Transferring the case would only shift the inconvenience from the Urban Outfitters to the Navajo Nation, he said.

He took exception to Urban Outfitters’ argument that the Philadelphia court had a higher level of competence with respect to IP issues, saying “all federal courts are presumed to be equally competent” in federal question cases.

He also noted that Urban Outfitters, with sales of $2.5 billion in the 2012 fiscal year, had the ability to bear the travel costs of litigation.

The case is Navajo Nation v. Urban Outfitters Inc., 1:12- cv-00195-LH-WDS, U.S. District Court, District of New Mexico (Albuquerque).

Foschini Challenge to ‘Due-South’ Trademark Rejected by Court

The Foschini Group Ltd. (TFG) has lost a trademark challenge it made to a shop in Franschhoek, South Africa, that specializes in regional craft items and travel guides, that country’s Business Day website reported.

The Cape Town-based company had objected to the souvenir shop’s use of “Due-South” as a trademark, saying it infringed on the mark it used with its Due South outdoor equipment stores, according to Business Day.

The Gauteng High Court rejected Foschini’s argument that customers would be confused by the name similarity, saying instead that the two entities operated different kinds of businesses, Business Day reported.

Judge Andre Louw of the court noted that Foschini hadn’t registered its mark in any of the classes of goods and services covered by the trademark applications submitted by the arts and crafts shop, according to Business Day.

Chinese Writer’s Descendants Say Tea Brand Name Insults Him

Descendants of a famous Qing Dynasty writer and government official have been staging a sit-in at a tea shop in China’s Fujian Province to protest the use of their ancestor’s name as a trademark for tea and other goods, China Daily reported.

Wang Qing acquired the rights to the Li Guangdi trademark for use with tea in 2006 despite the fact that this was the personal name of the seventeenth century philosophical writer, according to China Daily.

He told China Daily that others have also used the names of historic Chinese personages and registered them as trademarks even if they weren’t descendants of the famous persons.

The writer’s descendants are arguing that he had nothing to do with tea and that putting his name and likeness on tea packets that are discarded after use is an insult to their ancestor, China Daily reported.

For more trademark news, click here.

Copyright

Sony Non-Infringement Verdict Affirmed by Federal Appeals Court

A federal appeals court has rejected claims that Sony Corp. (6758)’s Sony Pictures Television unit infringed the copyright of a Boston photographer.

The case stems from a photo Donald A. Harney shot of Clark Rockefeller and his daughter Reigh. Rockefeller, who was born Christian Karl Gerhartsreiter, was convicted of kidnapping his daughter, and, according to court papers, Harney’s photo was used by police and the FBI in their search for Rockefeller.

Harney claimed Sony’s made-for-television movie “Who Is Clark Rockefeller” used his photo to create the image of the actors. The image Sony created for the movie “was clearly made to look like Harney’s photograph,” according to the complaint filed in 2010 in federal court in Boston. The film was distributed on A&E Television and is also available on the website of one of its units, www.mylifetime.com, according to court papers.

The image was used without authorization or compensation, Harney said in his complaint. The “use, distribution and publication” of the film constitutes copyright infringement, he said in his pleadings.

The trial court sided with Sony, which had argued there was no way a reasonable jury could find “substantial similarity” between Harney’s photo and its re-creation in the film.

While the Boston-based appeals court agreed with the trial court, it said it could “understand the frustration of photographers such as Harney whose works are afforded a limited copyright because they are comprised substantially of unprotected content.”

But such is the “essence of copyright,” the appeals court said, noting that the primary objective of copyright law isn’t to reward the labor of those who create content, “but to promote the progress of science and the useful arts.”

The lower court case is Harney v. Sony Pictures Television Inc., 1:10-cv-11181-RWZ, U.S. District Court, District of Massachusetts (Boston). The appeal is Harney v. Sony Pictures Television, 11-1760, U.S. Court of Appeals for the First Circuit.

For more copyright news, click here.

Trade Secrets/Industrial Espionage

Fellowes’s Complaint Triggers Trade Investigation

A complaint by Fellowes Inc., a maker of office equipment, has trigged an investigation by the U.S. International Trade Commission of paper shredders made by nine Chinese companies, according to a Jan. 22 statement from the commission.

Fellowes, based in Itasca, Illinois, has alleged that the companies infringe its patents and that some of its trade secrets have been misappropriated.

The Washington-based trade commission has the power to bar the importation of products that infringe U.S. intellectual property.

One of the nine companies named by the trade commission is also the target of a patent-infringement suit Fellowes filed in federal court in Chicago Dec. 26. In that suit, New United Office Equipments Co. of Yaoguan, Jiangshu Province, is accused of infringing two design patents, D583,859 and D598,048.

That suit also alleges that New United hired engineers from a third company affiliated with Fellowes, and acquired trade secrets related to the “design, manufacture and testing” of its paper shredders.

Fellowes claimed that trade secrets were also acquired illicitly by New United’s obtaining control of a manufacturing facility that contained “confidential tooling, molds, equipment and documents” that embodied and contained the Illinois company’s trade secrets.

New United Office Equipments didn’t respond immediately to an e-mailed request for comment.

Fellowes asked the court to bar further infringement of its patents and unauthorized use of its trade secrets, and for awards of money damages, litigation costs and attorney fees.

The case is Fellowes Inc., v. New United Office Equipment Co. Ltd, 1:12-cv-10273, U.S. District Court, Northern District of Illinois (Chicago).

To contact the reporter on this story: Victoria Slind-Flor in Oakland, California, at vslindflor@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.


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