RIGHTS OF PUBLICITY Common-Law Right
Use of identity for commercial purposes
COMMON THEMES Ownership
Exhaustion (First-Sale doctrine) and Parallel Imports
INTRODUCTION Sources of Authority
Constitution: Art. I, § 8, Cl. 8 Patent & Copyright
“To promote the progress of Science and the useful Arts, by securing for limited times to Authors and Inventors the exclusive rights to their respective writings and discoveries.”
Patent: 35 U.S.C.
Right of inventors – 20 yr period
Exclusive right = monopoly
Copyright: 17 U.S.C.
Right of Authors, Publishers & Consumers – life of author + 70 yr
Original works of authorship
Exclusive right to produce
Trademark: 15 U.S.C. + State Law
Law of brand names and logos – anything used to distinguish the goods and services of one business from another
Indefinitely as long as business is using
Unfair competition – common law tort (i.e. false advertising, trade secret misappropriation and trademark infringement originated here but is now codified under federal law)
Right of Publicity
Rationales for Protection of IP
Patent & Copyright
Incentive -- financial incentive to create things and protect them from free-riding
Natural right/ unjust enrichment -- the creator deserves to profit from their creation
Trademark = consumer protection
Prevents confusion in relevant markets
Protects good will of producer
Rationales for Limitation of IP
Free competition -- provides goods at the lowest possible prices
Protection of public domain
Freedom of speech (copyright and trademark)
** Where legislation is ambiguous, refer to these policy considerations to justify a certain outcome
INS v. Associated Press Hold: unfair competition by ∆, as two competing parties are endeavoring to make money and ∆s are misappropriating π’s quasi property interest in the news it collected and misrepresenting it as their own. (justified as “natural right”)
Limitation: only postpones participation of ∆ in distribution and reproduction that ∆ has not gathered, and only to the extent necessary to prevent competitor from reaping fruits of π’s efforts and expenditures
Stanley v. Columbia Broadcasting System, Inc.: to insure free trade in ideas the monopoly created by copyright is limited to the arrangement and combination of ideas – the form, sequence, and manner in which the composition expresses the ideas.
Sears, Roebuck & Co. v. Stiffel Co.: A State may not, consistently with the Supremacy Clause, extend the life of a patent beyond its expiration date or give a patent on an article that lacked the level of invention required for a federal patent. State law of unfair competition cannot override the federal patent law.
Trade Secret Protection State Law – but 47 states have adopted Uniform Trade Secret Act
Steps of Analysis Does the information or idea at issue qualify as a trade secret; AND
If so, is the ∆’s acquisition, disclosure, or use of it prohibited under one of the theories of improper means or misappropriation?
What are the secrets? Trade Secret: information of any type (including formulas, recipes, patterns, computer programs, databases, and methods) that –
Derives independent economic value from
Not being generally known to, and not being readily ascertainable by proper means, by other persons who can obtain economic value from its disclosure or use; and
Is subject of efforts that are reasonable under the circumstances to maintain its secrecy
Factors to consider in determining existence of TS:
The extent to which the secret is known to other
Extent of efforts to keep it secret (i.e., non-disclosure agreements, how effective measures will be, limited to need-to-know)
Ease to which it could be acquired by others
Value of the secret
Cybertek: Software protectable under TS doctrine, given appropriate facts and circumstances
Life insurance software constituted a tradesecret because the combination of concepts as developed and utilized in its system went beyond general information known in computer industry.
Was there misappropriation or improper means? Misappropriation [UTSA § 1(2)]
Acquisition by improper means; OR
Disclosure or use of a TS of another w/o express or implied consent by a person who
Used improper means to acquire knowledge of the TS; OR
At the time of disclosure or use, knew or had reason to know that his knowledge of the TS was –
Derived from or through a person who had utilized improper means to acquire it;
Acquired under circumstances giving rise to a duty to maintain its secrecy or limit its use; or
Derived from or through a person who owed a duty to the person seeking relief to maintain its secrecy or limit its use; or
Before a material change of his position, knew or had reason to know that it was a trade secret and that knowledge of it had been acquired by accident or mistake.
Improper Means [UTSA § 1(1)]: generally, those that are independently unlawful -- includes theft, bribery, misrepresentation, breach, or inducement of a breach of duty to maintain secrecy, or espionage through electronic or other means
DuPont v. Christopher: broader view of improper means including anything that violates the generally accepted principles of commercial morality and reasonable conduct.
Hold: Aerial photography from whatever altitude, is an improper method of discovering the trade secrets exposed during construction of the DuPont plant π may prohibit disclosure.
This is an example illustrating that improper means does not have to be independently unlawful
Breaches of Confidence Finding a duty of confidentiality, or duty to maintain secrecy. Look for:
∆ may have a duty by virtue of her relationship to the π Traditional fiduciary relationships s/a partnership and joint venture relationships, or attorney-client relationships
Contracts implied-in-fact and implied-in-law
Express contractual provision
Third-Party Liability: To be liable, persons obtaining a TS through an intermediate source, rather than directly from the π, must have notice, or reason to know, that the information is a TS and was obtained or is being disclosed through improper conduct or a breach of confidence.
Inevitable Disclosure Pepsico v. Redmond: threatened misappropriation can be enjoined where there is a high probability of inevitable and immediate use of the TS ∆’s new employment will inevitably lead him to rely on π’s TS.
Hold: π injunction granted – the particularized plans/processes developed by π and disclosed to ∆ while under employment, which are unknown to the industry, would inevitably be used as ∆ launches Gatorade and Snapple’s new plan know exactly how competitor will price, distribute and market drinks
Problems with Doctrine:
Creates a de facto non-compete and runs counter to public policy favor employee mobility
Covenant is imposed after the employment contract is made and therefore alters the employment relationship w/o employee’s consent
Defenses Proper means = independent invention or reverse engineering, but ∆ has BOP
If ∆’s (or its source’s) means of obtaining the t/s are “proper”, and there is no duty of confidentiality, the ∆ is free to use or disclose the t/s with impunity.
This is where t/s law differentiates from patent law – t/s offers no protection for work that has been disclosed to the public.
General Employee Knowledge & Skill RULE: employee is free to take general skills and knowledge acquired in the course of employment and use it in later pursuits.
Fleming Sales v. Bailey: RV manufacturer exec left and joined competitor
Hold: MSJ for ∆ could have had a covenant not-to-compete
General contact information of customer’s that is otherwise publicly available and readily ascertainable is not protectable as trade secrets; AND
Business experience and knowhow as reflected in information π attempts to conceal (names, contact info and purchase history of customers), however valuable, are not something the law protects from the rigors of the market-place.
Cf: Webcraft - ∆ (previously employed by custom printing co.) took rolodex of customers which took time and effort to create (not available to stranger), signed a non-disclosure agreement, took price information and quotes
Protection for Non-Trade Secrets: Restrictive Covenants RULE: generally, restrictive covenants will be enforced only if they are reasonable with respect to the coventee, the coventor, and the public interest
Covenants Not to Compete: employee agrees not to compete with the employer after leaving
RULE: whether reasonably necessary to protect employer from improper or unfair competition –
Does the employer have a legitimate business interest needing protection?
Is the restrictive covenant reasonable in scope?
Reasonableness: time (<2 years), place/location, scope of competition restricted, etc.
Strictly construed against employer & employer bears burden of demonstrating that restraint is reasonable
CA Business and Prof. Code: every contract by which anyone is restrained from engaging in lawful profession, trade or business of any kind is to that extent void
Nondisclosure Agreements: employee agrees not to disclose trade secret of other confidential information of the employer during and after her employment
RULE: NDAs that unreasonably restrain competition or unduly hinder an individual from pursuing his chosen livelihood will be unenforceable
Remedies Injunction: π must demonstrate irreparable injury and an inadequate remedy at law in order to obtain an injunction
Injunction is terminated wen the trade secret has ceased to exist, but may be continued for an additional reasonable period of time in order to eliminate commercial advantage that otherwise would be derived from the misappropriation. [UTSA § 2(a)]
Utility Patents Criteria for Patents
§ 101: Useful (utility) must be patent eligible subject matter
§ 102: Novel
§ 103: Non-obvious
Patent Prosecution Procedural Criteria: A patent application must include -
A written specification (§ 112)
A technical drawing (§ 113)
An oath or declaration (§ 115)
EXECPT: Inventors who wish to obtain an early filing date may file a “provisional application” must file a written description of the invention, the drawings, but need not submit claims or an oath/declaration.
Specification and Claims [§ 112]
An enabling description – a written description of the invention that is sufficient to enable a person having ordinary skill in the art (PHOSITA) to practice the invention. The invention need not be reduced to practice.
Explaining the invention and why it’s better than prior art
Claims: explaining in legal language the scope of the invention in elements
Each claim is evaluated separately – family of designs covered by the claim must include at least one member that is disclosed in the detailed part of the patent application
“Consists of” = limited to elements; comprises = includes, but not limited to
In order to examine validity, the claim is compared to prior art – family of designs covered by the language of a valid claim must not include any design disclosed in the prior literature
Written description, enablement, and best mode: best known mode is still a requirement in the statute, but failure to include best known mode is no longer grounds for invalidation
Procedure Submit application
If denied, may appeal to PTAB
May appeal PTAB judgment directly to federal circuit, or to district court for N.D.V.A. if you want to introduce new evidence
Patentable Subject Matter [35 U.S.C. § 101]: “Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.” Legislative history: anything under the sun that is made by man – humans excluded. Statues includes:
Processes, machine, manufacture, or composition of matter, OR
Any improvement thereof.
Patent eligible: a non-naturally occurring manufacture or composition of matter – a product of human ingenuity having distinctive name, character, and use.
Manufacture: the production of articles for use from raw or prepared materials by giving to these materials new forms, qualities, properties, or combinations, whether by hand-labor or by machinery.
Composition of matter: all compositions of two or more substances and all composite articles, whether they be the results of chemical union, or of mechanical mixture, or whether they be gases, fluids, powders or solids.
EX: Diamond v. Chakrabarty: π’s genetically-engineered micro-organism is patentable subject matter – not nature’s handiwork, but his own joining of two separate plasmids to create one organism (Cf: Funk – combo of two things that stay separate)
Patent ineligible: laws of nature, physical phenomena, mathematical formulas or algorithms, and abstract ideas are not patentable.
Laws of Nature Mayo: method for measuring metabolites in bloodstream to determine how your body processes a drug and how much drug is needed for effective treatment is a “law of nature” and not patentable subject matter
AMP v. Myriad: Isolated DNA segments are naturally occurring = not patentable
Abstract Ideas Alice Corp. Hold: abstract idea of intermediated settlement as performed by a generic comp. was not patentable and generic method claims failed to transform the abstract idea
Steps of Analysis: A court must first identify -
The abstract idea represented in the claim, and then
Determine whether the balance of the claim adds “significantly more” (Routine, conventional, post-solution activities don’t count)
Distinguish between patents that claim the building blocks of human ingenuity and those that integrate the building blocks into something more, thereby transforming them into a patent-eligible invention
** Many software patents threatened by this decision
Bilski: ineligible -- “[h]edging is a fundamental economic practice long prevalent in our system of commerce and taught in any introductory finance class.”
Flook: ineligible -- A computerized method for using a mathematical formula to adjust alarm limits for certain operating conditions (e.g., temperature and pressure) that could signal inefficiency or danger in a catalytic conversion process
Diehr: eligible -- computer-implemented process for curing rubber was patent eligible b/c it used a thermocouple to record temperature measurements inside the rubber mold, which is an improvement to an existing technological process that the industry had not been able to do
Misc. Cases JEM Ag Supply v. Pioneer: sexually reproduced plants may be subject of a utility patent, even though they may also be protected through a certificate of plant variety protection
Standards of Patentability – Substantive Patent Requirements Steps of Analysis Determine whether the pre-AIA provisions or post-AIA previsions apply.
Determine who was the “first-to-invent” and when
Compare this date to the relevant statutory requirements
Determine who was the “first-to-file” and when
Compare this date to the relevant statutory requirements
Conclude who is entitled to the patent
Determining What Standards to Apply If application was filed before March 16, 2013 old version of § 102 & § 103 apply
Old sections assess novelty and obviousness at the time of invention first-to-invent
Invention: conception + reduction to practice
Conception: when the inventor formulates a definite, complete idea of the operative invention, so that all that remains is the physical realization of it
Reduction to practice: (a) actual = building a physical prototype and ascertaining that it works; or (b) constructive = filing patent application
Exception: First to reduce invention to practice is presumed to be the inventor, but first to conceive may rebut presumption if he/she was reasonably diligent in reducing it to practice (2011 Exam – 3 weeks between conception and reduction is reasonable).
If no date is given, the inventor is presumed to have reduced the invention to practice on the date of filing.
If application was filed on or after March 16, 2013 new sections apply
New sections assess novelty and obviousness at the time of application first-to-file
Effective filing date: defined as the actual filing date
Utility: § 101 - “Whoever invents or discovers any new and useful process..” Well-Established Utility:
If a person having ordinary skill in the art (PHOSITA) would immediately appreciate why the invention is useful based on the characteristics of the invention; AND
The utility is specific, substantial, and credible.
Brenner v. Manson: a process is not patentable unless we know the use of the product it creates
Process of creating steroid not patentable until we know what steroid is good for
Unless and until a process is refined and developed to the point where there is specific benefit derived to the public, there is insufficient justification for permitting an applicant to engross what may prove to be a broad field
Novelty & Statutory Bar: § 102 Steps of Analysis Determine filing date
If filed before 3/16/13 use pre-AIA rules
If filed after 3/16/13 use revised-AIA rules
Go through each sub-section to determine whether invention qualifies as novel
Novelty: Lack of novelty (“anticipation”) exists if there is a single prior art disclosure which contains all elements of the claim arranged in the same manner must compare claims to every section of prior art, cannot combine claims (NetMoney)
NetMoneyIn,Inc.: The IKP reference setting forth standard of how payments may be accomplished “efficiently, reliably, and securely” did not disclose all the limitations recited in ∆’s claim error to find anticipation by combining different parts of the separate protocols in the IKP reference.
Courts may recognize “inherent anticipation,” where the reference does not expressly disclose all the elements of the later invention, but the non-express elements are nonetheless necessarily present in the thing described/ disclosed in the reference
Pre-AIA: applications filed BEFOREMarch 16, 2013 (a) Patent denied if prior to invention by applicant, the invention was:
“Known” in the US
Invention was fully disclosed – sufficient to enable a PHOSITA to practice the invention; AND
Accessible to the public (opposite of secrecy).
“Used” by others in the US
Invention was actually reduced to practice; AND
Was accessible to the public (i.e., absence of affirmative steps to conceal)
The subject of a patent anywhere in the world, OR
Patents become part of prior art on the date of issuance, if minimally accessible to the public
(e): Patent denied if invention disclosed in a U.S. patent application pending on the date of invention and later either published or granted.
(f): Patent denied if applicant did not invent the invention
(g): Patent denied if prior to A’s invention, another person made the invention in the U.S., or another person establishes in an interference that he made invention abroad prior to the applicant’s invention, if the invention not abandoned, suppressed, or concealed.
Statutory Bar Provisions (b): Patent denied if > 1 year before date of filing, the invention was in public use or on sale in the U.S., or was patented or described in a printed publication anywhere in the world.
Focuses on the activities of anyone (including the applicant) > 1 year before the date of filing
Public use: Use by the inventor for commercial purposes, but not for private enjoyment. Experimental use (or sale) will not trigger, even if public.
Experimental Use: Must be testing the device, not the market (market testing = where the inventor is attempting to gauge consumer demand for his claimed invention)
City of Elizabeth: inventor applied his pavement on a public road and evaluated it for 6 years experimental
In re Smith: Airwick product tested by 76 homemakers = market testing, NOT experimental
On Sale Pfaff: on-sale bar applies when a product embodying the invention is
The subject of a commercial offer for sale, (satisfies formal standards of offer under UCC); and
Ready to patent (either reduced to practice or proof that an enabling disclosure could be made)
Moleculon: (rubik’s cube) an assignment or sale of rights in the invention and potential patent rights is not a sale of “the invention” within the meaning of § 102(b) means tangible embodiment of product, who has the “control”
(c): Patent denied if inventor has abandoned the invention. May be express or implied
Means abandonment of the right to patent the invention
Cf: (g) means abandonment of the invention itself – inventor no longer working on it
(d): patent denied if the invention was subject of a foreign patent app > 1 year before app was filed in U.S. and foreign patent issues before app filed in U.S.
Current: applications filed AFTERMarch 16, 2013 Differences No geographical restrictions everything in the world counts
(b)(1) exception to (a)(1)
(b)(2) exception to (a)(2)
Similarity: 1-year grace period stand (public disclosure w/in 1-year of filing OK)
35 U.S.C. § 102 (revised) (A) A person shall be entitled to a patent unless:
Claimed invention was patented, described in a printed publication, or in public use, on sale, or otherwise available to the public before the effective filing date
The claimed invention was described in an [issued] patent… or in an application for a patent published or deemed published…in which the patent or application … names another inventor and was effectively filed before the effective filing date of the claimed invention
(B) If there is an enabling disclosure, inventor disqualified from patent UNLESS disclosure is excluded from prior art. Exceptions:
A disclosure made 1 year or less before the effective filing date of the claimed invention shall not be prior art … under (a)(1) if:
Disclosure was made by the inventor or by another who obtained the subject matter disclosed directly or indirectly from the inventor; OR
The subject matter disclosed had, before such disclosure, been publicly disclosed by the inventor…or another who obtained the subject matter directly or indirectly from the inventor
A disclosure shall not be prior art to a claimed invention under (a)(2) if:
The subject matter disclosed was obtained directly or indirectly from the inventor;
“ “ had, before such subject matter was effectively filed under (a)(2), been publicly disclosed by the inventor or another who obtained it directly or indirectly from the inventor;
“ “ and the claimed invention, not later than the effective filing date, were owned by the same person or subject to an obligation of assignment to the same person
Non-Obviousness: § 103 RULE: A patent for a claimed invention may not be obtained… if the differences between the claimed invention and the prior art are such that the claimed invention as a whole would have been obvious before the effective filing date to a person having ordinary skill in the art to which the claimed invention pertains.
Filing date before 3/16/13 obvious at applicant’s invention date
Filing date after 3/16/13 obvious at applicant’s effective filing date
Cf: Novelty – here, one may combine prior art references to demonstrate obviousness
Steps of Analysis (Graham v. John Deere)
The scope and content of the prior art;
The differences between the prior art and the claims at issue; AND
The level of ordinary skill in the pertinent art
Legal Determinations: Would the subject matter of the patent application have been obvious to a person having ordinary skill in the art (PHOSITA) and knowledge of the pertinent prior art?
Considerations Was the general idea of the invention conceived prior to the applicant?
Was the concept publicly known?
If an improvement to an existing invention, how long has the original been in public use without any necessary improvements?
Secondary Considerations: courts may also consider such things as commercial success, long felt but unresolved needs, failure of others, skepticism or movement of others in different directions, etc. to indicate invention was non-obvious.
**If an alleged infringing art is similar and can be found to have been “independently invented” obvious (2012 exam)
Definitions Prior Art: considered analogous if –
It is from the same field of endeavor, regardless of the problem addressed, OR
If not in the same field, if it is reasonably pertinent to the particular problem with which the inventor is involved
Reasonably Pertinent: even though it may be in a different field from that of the inventor’s endeavor, it is one which, because of the matter with which it deals, logically it would have commended itself to an inventor’s attention in considering his problem
** One may combine prior art references to demonstrate obviousness
Ordinary Skill: To determine PHOSITA, consider –
The education level of the inventor & active workers in the field;
Type of problems encountered in the art;
Prior art solutions to those problems;
Rapidity with which innovations are made;
Sophistication of the technology
EX: KSR - patent on connecting an adjustable vehicle control pedal to an electronic throttle control obvious b/c although they had never been combined, the existence of the technology would have caused any PHOSITA to see the obvious benefit in combining
Exclusive Rights & Duration [§ 154]
Offer for Sale
For process patents – the product that results is also protected
In the United States
Duration = 20 years from date of application
Infringement [§ 271]
Literal Patent Infringement: violating any of the 5 exclusive rights in the U.S. within its term
Procedure: compare claim to the accused product or process
Must have ALL elements of at least one claim (i.e., if claim has 4 elements, accused product or process must have ALL 4)
Types of Literal Infringement Directinfringement [§ 271(a)]: whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States, or imports into the United States any patented invention during the term of the patent therefor, infringes the patent.
Strict liability the π need make no showing of intent, knowledge, or neglect of ∆
Inducing infringement [§ 271(b)]: whoever actively induces infringement of a patent shall be liable as an infringer (see Secondary Liability)
Contributory infringement [§ 271(c)]: (see Secondary Liability)
Exporting components to be assembled outside the U.S. [§ 271(f)]
Violate if you supply all or a substantial portion of the components of a patent invention from the U.S., to actively induce the combo of those components outside of the U.S. in a manner that would infringe had it been done here.
Overruled Deepsouth Packing: Substantial manufacture of the constituent parts of a machine does not constitute direct infringement given a combination patent protects only the operable assembly of the whole and not the manufacture of its parts
Importing the product of patented process [§ 271(g)]
Defenses to Infringement Patent Invalidity Patent is presumed valid [§ 282]
Challenger must prove with clear & convincing evidence that the provisions of the Patent Act have not been satisfied
If π did a post-grant opposition they could be estopped from claiming invalidity
Inequitable Conduct (fraud on PTO – hard to show)
Intent to defraud the PTO
Knew about something (specific intent)
That was material (prior art is but-for material if the PTO would not have allowed a claim had it been aware of the undisclosed prior art)
Proof by clear & convincing evidence
Prior Use [§ 273(b)(1)]
For business methods pre-AIA; all other patents post-AIA
Available if ∆:
In good faith
Actually reduced the subject matter to practice
At least 1 year before the effective filing date of the asserted business method patent, and
Commercially used the subject matter before filing date.
∆ must prove with clear & convincing evidence
Patent misuse: using your patent in order to force something that was not patentable.
Doctrine of Exhaustion: repair of patented product is permitted while reconditioning or remanufacturing is not (see Exhaustion below).