Bloomberg News

Patent Trolls, Zappa, NFL, WIPO: Intellectual Property (1)

June 21, 2013

U.S. Federal Trade Commission Chairwoman Edith Ramirez said the agency should conduct a broad probe of patent-assertion entities, known as “patent trolls” to those who accuse them of abusing the system.

Ramirez said yesterday she would like to see a full-fledged inquiry to determine whether the entities’ activities hamper or encourage innovation and competition. President Barack Obama earlier this month announced a crackdown on patent litigation in an effort to protect technology, finance and retail companies from lawsuits and demands for fees.

The crackdown includes five executive actions and seven recommendations that require congressional action. A White House commission report said more than 100,000 companies were threatened with infringement last year by patent-assertion entities, whose sole business is to obtain patents and use them to extract royalties from other businesses.

The entities are “driving the increase in patent litigation and targeting firms in a growing slice of the economy,” Ramirez said at a workshop yesterday sponsored by the Washington-based American Antitrust Institute and the Computer and Communications Industry Association, a trade group whose members include Google Inc. (GOOG:US) and Microsoft Corp. (MSFT:US) “The costs to consumers from PAE activity appear increasingly tangible and direct.”

Abusive patent lawsuits are a growing drain on companies and the courts, though not all businesses that own patents without making products are “trolls,” according to a report released June 4 by the White House Council of Economic Advisers, the National Economic Council and the Office of Science and Technology Policy.

The FTC and the antitrust division of the U.S. Justice Department conducted a joint workshop on patent assertion entities in December.

At yesterday’s workshop, Ramirez said antitrust enforcers “have a role to play in advancing a greater understanding of the impact of PAE activity and using our enforcement authority, where appropriate, to curb anticompetitive and deceptive conduct.”

Standard Innovation Wins Order Barring Infringing Sex Toys

Standard Innovation Corp., a Canadian maker of sex toys, persuaded the U.S. International Trade Commission to issue an exclusion order barring the entry of products that infringe a patent.

The ITC, a Washington-based agency with the power to bar the importation of products that infringe U.S. patents, said June 17 that products infringing patent 7,931,605 cannot be imported, distributed or sold. That patent, issued in April 2011, covers an “electro-mechanical sexual stimulation device to be worn during intercourse.”

The ITC order specifically bars a vibrator made by Lelo Inc. of San Jose, California. The commission found that the disputed patent is valid.

In a June 17 statement, Ottawa-based Standard Innovation said the patent covers its We-Vibe device, and clams that the ITC ruling acknowledged the product as “truly innovative.”

For more patent news, click here.

Trademark

Frank Zappa’s Widow Seeks to Register ‘Captain Beefheart’ Mark

Adelaide Gail Zappa, the widow of musician Frank Zappa, applied to register the stage name of one of Zappa’s collaborators as a trademark, according to the database of the U.S. Patent and Trademark Office.

Zappa filed her application to register “Captain Beefheart” for music-related uses including the downloading of ringtones and musical and video recordings. According to the patent office, she has until Dec. 18 to file a statement of the use of the mark.

Captain Beefheart, whose real name was Don Glen Vliet, performed with Zappa early in their careers, before they became estranged over artistic issues. They reportedly reconciled shortly before Zappa’s death in 1993 from the complications of prostate cancer.

According to a New York Times obituary, Beefheart died from multiple sclerosis in December 2010 at the age of 69.

Zappa has been a zealous defender of her late husband’s intellectual-property rights. She has filed at least five copyright-infringement suits since 2000, according to data compiled by Bloomberg.

NFL Puts New Jersey Towns on Notice Over Super Bowl Licenses

Although the next Super Bowl game won’t take place until Feb. 2, 2014, the New York/New Jersey Super Bowl Host Committee has already sent warning letters to all 565 New Jersey municipalities warning them of the National Football League’s trademark-licensing rules, the Bergen Record newspaper reported.

The letter warned that while communities can bill themselves as a “Super Community,” they are barred from using the logos of the NFL, the trophy awarded the game’s winner and the Super Bowl itself, according to the newspaper.

Communities whose officials work with the committee and who are approved will be allowed to use the snowflake logo for the game on their websites and advertising materials, the newspaper reported.

Violators of the NFL trademark guidelines will initially receive a warning letter or phone call, followed by more serious measures for those that don’t cooperate, the Record reported.

For more trademark news, click here.

Copyright

Apple Denies Fixing E-Book Prices in Antitrust Trial Closing

Apple Inc. (AAPL:US) got one last chance to defend itself from U.S. charges it led publishers in a scheme to fix the prices for electronic books, as a lawyer for the company told a judge that it did nothing wrong.

“Apple did not conspire with a single publisher to fix prices in the e-books industry,” Orin Snyder, Apple’s lawyer, told U.S. District Judge Denise Cote in his closing argument at the end of a civil antitrust trial in Manhattan. “Apple acted lawfully and did not violate the antitrust laws.”

The government claims Apple and five of the biggest book publishers conspired to move the e-books market to a model that raised prices and harmed consumers. The trial focused on December 2009 and January 2010, when Apple was racing to sign contracts with the publishers and build an iBookstore in time for the introduction of the iPad.

Cote, who will decide the case without a jury, interrupted Snyder repeatedly with questions. In a court conference before the trial, Cote told lawyers for both sides her “tentative view” was that the government has evidence that Apple “knowingly participated in and facilitated a conspiracy to raise prices of e-books.”

Apple is the last defendant remaining in the case after the five publishers sued by the government avoided trial by settling.

The settling publishers are Verlagsgruppe Georg von Holtzbrinck GmbH’s Macmillan unit, CBS Corp. (CBS:US)’s Simon & Schuster, Lagardere SCA (MMB)’s Hachette Book Group, Pearson Plc (PSON)’s Penguin unit and News Corp.’s HarperCollins. The No. 1 publisher, Random House Inc., isn’t involved in the U.S. suit.

The government is seeking an order barring Apple from alleged anticompetitive actions, including price fixing, in the market for digital books. The U.S. isn’t asking for money damages.

A group of states is also seeking fines and unspecified damages. If Apple is found liable in the trial, damages will be determined in a separate proceeding. A win for the government may fuel class actions by private plaintiffs seeking triple damages permitted under antitrust law.

The case is U.S. v. Apple Inc., 12-cv-02826, U.S. District Court, Southern District of New York (Manhattan).

Vatican Tells WIPO Copyright Laws Can Hinder the Blind

A representative of the Roman Catholic Church urged that copyright laws be modified to provide better services to those who are visually impaired, Catholic News Service reported.

Speaking at a World Intellectual Property Organization conference June 18, Archbishop Silvano M. Tomasi said that copyright law has never been an end to itself and that the goal of the copyright system is the enhancement of human good through the dissemination of creative work, according to CNS.

Tomasi, the Vatican’s permanent observer to United Nations agencies, said that although audio books and text-to-speech tools provide a quicker and cheaper way to get content to the blind than translating them into Braille and printing them, present-day copyright laws often provide obstacles to the use of new technology to aid the blind, CNS reported.

He referred to a section of the Universal Declaration of Human Rights that specifies that individuals have the right to participate in the cultural life of their communities and benefit from the arts and sciences, according to CNS.

For more copyright news, click here.

IP Moves

Gowlings Hires Brian Kingwell, Former Smart & Biggar Partner

Gowlings Canada Inc. hired Brian Kingwell for its patent and trademark practice, the Ottawa-based law firm said in a statement.

Kingwell, who does both patent acquisition and transactional work, joins from Smart & Biggar, also of Ottawa. There he represented clients whose technologies included molecular biology, biochemistry, chemistry, chemical engineering and medical devices.

He has an undergraduate degree in biochemistry and a master’s degree on molecular cell biology from the University of Calgary and a law degree from the University of Ottawa.

To contact the reporter on this story: Victoria Slind-Flor in San Francisco at vslindflor@bloomberg.net

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


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