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  Take Action Against Domain Names that Infringe Your Trademarks

  Posted: May 24th, 2010, 5:44pm EDT

  U.S. businesses facing the misappropriation of their trademarks in the form of Internet domain names registered by third parties have a quiver-full of powerful remedies to obtain relief from such practices. In addition to “traditional” trademark actions in cases where the third party is using a confusingly similar domain name in connection with products or services similar to those offered by a trademark owner, U.S. law also offers significant ammunition against third parties who register names and then “squat” on them, without ever using the names in connection with the offering of any goods or services. Under the Anticybersquatting Consumer Protection Act (ACPA), trademark owners may sue such third parties in federal court to obtain both an injunction requiring the transfer or cancellation of the infringing domain name or names as well as actual damages or, at the mark owner’s election, statutory damages up to $100,000 per name, in the court’s discretion. However, in many cases the registrant of an infringing domain name may be located in a foreign country and not subject to the personal jurisdiction of a U.S. district court in an ACPA proceeding. Under those circumstances, the ACPA provides for proceedings in rem, which are, in effect, lawsuits against the domain names themselves. In that type of proceeding, the trademark owner files suit in the U.S. judicial district where either the domain name registrar (e.g., GoDaddy.com or Network Solutions) or the domain registry (e.g., VeriSign for .COM and .NET domains) is located. Following notice to the registrant and to the registrar or registry, the court then makes a determination as to whether the domain name infringes the trademark owner’s rights and, if the mark owner prevails, issues an order compelling the registrar or registry to cancel or transfer the name. In addition, the 9th Circuit Court of Appeals recently confirmed what appears to be the plain language of the ACPA by affirming that in rem actions pertaining to .COM and .NET addresses (which often are the top-level domains most frequently the subject of ACPA suits) may be brought in the Northern District of California, where VeriSign is located. This decision makes it easier for many trademark owners to consolidate their domain recovery efforts in one venue, rather than filing suit in districts where individual registrars may be located. If your business has discovered infringing uses of its trademarks in third-party domain names, you should consult with knowledgeable intellectual property counsel to determine whether one or more ACPA actions may be appropriate as part of a comprehensive IP enforcement strategy.
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  Three Critical Legal Protections for New Businesses

  Posted: May 24th, 2010, 5:44pm EDT

  If you have started a business and have not already formed an organizational entity or protected your business name, you should swiftly move to protect yourself and your business from unforeseen liability or loss of intellectual property. New business owners should form a legal structure to add additional protection against personal liability. Establishing a partnership, professional corporation, limited liability company, or corporation will add additional layers or protection against claims related to your business. Business of all types – retail, general services, medical, financial, technology, and media, to name a few – should form legal identities at the early stages of their existence. Compared to defending a claim against you or your business, setting up a legal entity is generally affordable and straightforward. A good rule of thumb is: If you have customers or clients, you could have a lawsuit. Don’t risk your business or your personal assets. Protect yourself. In addition, registering your core trademarks is something every entrepreneur should investigate. A trademark registered with the U.S. Patent & Trademark Office will establish your claim of right to a particular brand and will provide you with a stronger position when asserting or defending against infringement claims if another business contends you are improperly using their brand. Additionally, a registered trademark will enable you to pursue infringers with more confidence in achieving a successful result. A cease and desist letter accompanied with proof of a federal trademark registration is oftentimes all it takes to dissuade a would-be infringer from using your business name or a name similar to your business name. Preventing others from operating under business names similar to yours also will help you differentiate your business as a leader in your field and will ensure consumers do not confuse your products and services with those provided by business that may be offering inferior products and services. Finally, obtaining copyright registrations at the U.S. Copyright Office for any original content, whether written or electronic, that you own will provide you with a stronger claim of right over those materials. As with trademark registrations, copyright registrations also will prevent other business from taking your words and pictures and using them for their business. Obtaining a copyright registration for a website is often the first step a business takes in protecting its content. It also represents a strategic first copyright, because websites often include both textual descriptions of the business and images related to the business’ products and services. Obtaining a website copyright is advisable because it can protect a large amount of original material with one legal tool.
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  Second Circuit: No Unbundled Copyright Damages for Music Compilations

  Posted: May 24th, 2010, 5:43pm EDT

  The Second Circuit Court of Appeals recently made what may have been the first U.S. federal appellate decision finding an album of music recordings to be a single work under the damages provision of the Copyright Act of 1976. In Bryant v. Media Right Productions, Inc., the court agreed with the lower court that an album is to be considered a “compilation” under the Act and, therefore, that a plaintiff is only entitled to statutory damages on a per-album basis. Specifically, the court says: Based on a plain reading of the statute, therefore, infringement of an album should result in only one statutory damage award. The fact that each song may have received a separate copyright is irrelevant to this analysis. The plaintiffs in this case argued that each copyrighted song constitutes a “work” under the 1972 Act, and therefore demanded statutory damages for each song contained on the two albums in the complaint. To make their argument, the plaintiffs relied heavily on decisions where other Circuits applied an “independent economic value” test to determine whether each work contained within a compilation qualifies for separate statutory damages. Here, the Second Circuit specifically rejected the “independent economic value” test and instead relied on a plain reading of the statute along with accompanying legislative commentary to hold that an album compiled by the songwriters constitutes a single work. The Second Circuit’s reading of the compilation language of the 1976 Act may significantly reduce the value placed on album-infringement disputes by copyright holders. Whether this ruling could reach beyond the music industry to influence other decisions regarding assembling preexisting copyrighted materials into a compilation—such as bundled software packages in software copyright disputes—is an interesting question that could have broad ramifications.
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  Timely Registration is Critical to Copyright Protection

  Posted: May 24th, 2010, 5:41pm EDT

  Protecting copyrighted materials should be a core concern among people and businesses that develop original creative works, regardless of whether those works are published or unpublished. Timely registration with the U.S. Copyright Office is critical to protecting a copyright and to being able to obtain the full measure of legal remedies against infringers. The requirements for registering copyrightable material, such as company brochures, advertisements, software, or other original works, are set forth in Chapter 4 of the U.S. Copyright Act. After those materials are created, the copyright applicant generally must submit an application for registration, a sample deposit of the work, and the appropriate fee to the Copyright Office to begin the registration process. Chapter 4 of the Copyright Act also provides that failure to take the steps necessary to obtain the registration may result in potential infringement actions being dismissed. In addition, even if the copyright in a work has been registered prior to filing suit, it is important to keep in mind that Chapter 4 further requires that a copyright be registered within 3 months after the initial publication date in order for the owner to be able to obtain statutory damages in litigation under the Copyright Act. Therefore, seeking an expedited registration for an infringed work may allow the plaintiff into court, but if the copyright registration date is more than 3 months after the date the subject work was published, that plaintiff will be deprived of the statutory damages remedy and forced to spend additional resources in an effort to prove actual damages, which, in many cases, may be negligible. All owners should register their copyrights with the U.S. Copyright Office within the timeline provided under the Copyright Act in order to help safeguard the ability to effectively enforce those copyrights.
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  When Your Brand is Attacked Online, The Author May Be the Only Liable Party

  Posted: May 13th, 2010, 5:25pm EDT

  The United States District Court of New Jersey recently issued an opinion in a defamation action regarding an author’s post to a USENET group. The plaintiff, Charles Novins, an attorney in New Jersey, sent a letter to the defendant, Kevin Cannon, in early 2009 demanding Cannon retract his post to a USENET group in which Cannon accused Novins of, among other things, hiring drug addicts at his firm. After apparently not receiving the relief requested in his letter, Novins filed suit against Cannon along with a host of other defendants. The defendants moved to dismiss under the argument that the U.S. Communications Decency Act (“CDA”) immunizes everyone involved in content delivery with the exception of the “information content provider,” who was, in this case, the post’s author. The court agreed and dismissed the lawsuit. The CDA often is applied to Internet service providers, but it has also been used by individuals who operate websites and web-based forums. The CDA even has been used to protect individuals who knowingly allow content to be posted to a website under their control. Although the New Jersey case involved an antiquated forum (USENET can be properly characterized as Web 0.1), the rule generally applies to Web 2.0 as well, from Twitter to Facebook to, likely, whatever comes next. Courts continue to find that the CDA immunizes publishers from liability for defamatory comments posted to their websites. In many cases, filing suit against anyone other than the author of arguably defamatory content is likely to produce no advantage for the complainant. A better approach to dealing with attacks on your online brand may be to utilize other methods, such as drowning the negative comments with positive publicity. An attorney knowledgeable regarding Internet marketing and brand protection efforts can assist you to formulate an appropriate strategy in response defamatory, third-party activities.
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  ACTA May Bring DMCA-style Website Takedowns to the World

  Posted: May 13th, 2010, 5:23pm EDT

  After years of negotiations, several leaks regarding the text of the treaty, and resulting public pressure to soften what have been perceived by many to be some of its more excessively pro-industry components, on April 20, 2010, the countries negotiating the Anti-Counterfeiting Trade Agreement (“ACTA”) released a draft of the document for public review. That draft is available here. The intent of ACTA’s drafters is to establish international standards on the enforcement of intellectual-property rights in the participating countries. (ACTA’s current drafters include Australia, Canada, the European Commission, Japan, Jordan, Mexico, Morocco, New Zealand, North Korea, Singapore, Switzerland, the United Arab Emirates, and the USA.) ACTA includes a number of provisions that indeed may have a significant impact on the enforcement of IP rights worldwide. One of the more interesting of those provisions is a proposed grant of safe harbor to Internet service providers (“ISPs”) hosting infringing content due to the actions of the ISPs’ customers, provided that the ISPs take action to remove that content following their receipt of notice that it is present on their servers. Such a provision could end up being similar to Section 512 of the U.S. Digital Millennium Copyright Act (“DMCA”), under which a content owner can send a notice to an ISP regarding the presence of infringing content on the ISP’s servers, in response to which the ISP must take action in order to maintain its safe harbor status. At this stage, ACTA remains a rough draft in which the safe harbor options have yet to be confirmed. In addition, ACTA does not include steps as detailed as those under the DMCA to guide the form and substance of take-down notices, instead leaving those steps to the discretion of the member countries, within certain bounds. However, the overall outline of safe harbor under ACTA could be fairly similar to that under the DMCA, with safe harbor being conditioned under one option as follows (text in brackets remains unresolved): an online service provider expeditiously removing or disabling access to material or [activity][alleged infringement], upon receipt [of legally sufficient notice of alleged infringement,][of an order from a competent authority] and in the absence of a legally sufficient response from the relevant subscriber of the online service provider indicating that the notice was the result of mistake or misidentification. It will be very interesting to see how the ACTA negotiators resolve the issue of ISP liability and safe harbor. Businesses that have encountered infringing, third-party content hosted by U.S. ISPs have for several years been able to take advantage of Section 512 notices under the DMCA to cause the removal of that content in an efficient and cost-effective manner. However, foreign ISPs often do not have much to gain by compliance with U.S. copyright law, so the same procedures generally have been less effective against content hosted outside the U.S. An effective safe harbor provision under ACTA may change that.