Scandalous Trademarks: What You Need to Know.

The Lanham Act, which governs trademarks that are registered through the United States Patent and Trademark Office (“USPTO”), expressly prohibits the registration of marks that are deemed scandalous, immoral, or deceptive. This prohibition has historically prevented brands from using marks that could fall into this category, even if the mark is appropriate for the situation. However, in 2019, this prohibition was expressly overridden and these types of marks are now eligible for registration and protection under the Lanham Act.

During the summer of 2019, the United States Supreme Court determined that the prohibition against scandalous marks contained in the Lanham Act is an unconstitutional prohibition on protected speech. See Iancu v. Brunetti, 488 U.S. ___ (2019). Essentially, the Court decided that this amounted to viewpoint discrimination, in violation of the First Amendment. As a result, the USPTO is required to accept and consider scandalous trademark registration applications.

For businesses, artists, and musicians that utilize what was deemed scandalous marks by the USPTO as part of their operations, now is the time to act to protect the intellectual property. Although the USPTO hasn’t reported a rush applications that fit this category, now that these previously un-protected marks are protectable, it is expected that the volume of applications will increase.

VW Contributor: Alex Rainville
© 2020 Vandenack Weaver LLC
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Fortnite Under Siege

Fornite, the video game by Epic Games that has taken the world by storm, has been subject to a number of copyright infringement claims for dances performed by characters in the game. The dances causing problems include those that are well known and new viral sensations such as the “Carlton,” “Backpack Kid” flossing, “Milly Rock” dance, and Halloween “Pump It Up.” While most are relatively standard copyright infringement claims, alleging the characters doing the dances in the game infringe on the copyright, one claim, for infringement of the “Running Man” dance, has an interesting twist.

A recent decision by the United States Supreme Court mandated that a copyright owner must register the work with the Copyright Office prior to filing a claim for copyright infringement. As a result, many claims, including those against Epic Games, were withdrawn until the work could be registered. However, the owners of the “Running Man” dance elected to amend their claim, from a copyright infringement claim to trademark infringement claim. As a defense to trademark infringement, Epic Games is asserting that the claims are preempted by the Copyright Act. Although no one disputes that the name of a dance can be protected under trademark law, it is unclear whether a court will decide if the dance itself is protected; typically a dance is protected by copyright, as choreography.

This could open the door for more claims against Epic Games for dances used in Fortnite, but the more impactful consequence is the potential to further define the scope of what constitutes a trademark. If it is ultimately determined that a dance can be a protectable trademark, that would add to the list of protectable marks, which already includes color, scent, sound, designs, layouts, and words.

VW Contributor: Alex Rainville
© 2020 Vandenack Weaver LLC
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The Defend Trade Secrets Act

Last summer, Congress enacted the Defend Trade Secrets Act (“DTSA”), which created a federal civil cause of action for misappropriation of trade secrets. Recently, various courts have started to interpret the DTSA, and determined that it does not preempt existing state law, but gives trade secret owners the option to enforce their claims and receive more consistent outcomes than they would in state court. Prior to the DTSA’s enactment, manufacturers and sellers had to bring trade secret misappropriation claims in state court, unless the parties could establish diversity jurisdiction or an independent federal cause of action.  Because state interpretations of the Uniform Trade Secrets Act vary in every state, consistent relief was not always possible.  For example, the definition of “trade secret” and the types of remedies differ across states. However, the DTSA applies nationwide and provides a uniform statute for trade secret owners to rely on in federal court.

The DTSA has important features that will impact trade secret owners.  Notably, it defines “misappropriation” and “trade secret”, which aids in consistent enforcement across state lines.  Additionally, it creates a civil seizure mechanism, which allows courts to order the seizure of property to prevent the propagation or dissemination of the trade secret, even before a formal finding of misappropriation is established and without notice to the alleged wrongdoer.  Last, a whistleblower provision provides immunity to employees from criminal or civil liability under federal or state laws for disclosing a trade secret to an attorney or government official for purposes of reporting or investigating a suspected violation of the law or filing a lawsuit made under seal.

Most controversial is the civil seizure provision, and courts are reluctant to permit seizures unless the plaintiff establishes necessity. Also controversial, federal courts are turning to state courts for guidance in interpreting the DTSA, thus, defeating its underlying purpose of providing uniformity. However, these issues are likely to be resolved over time. Since its enactment, it is estimated that less than seventy cases have been brought under the DTSA, but the law provides an important option for those pursuing trade secret claims.

© 2017 Vandenack Weaver LLC
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