class certification partly granted in Tesla self-driving case

In Re Tesla Advanced Driver
Assistance Systems Litig., No. 22-cv-05240-RFL, 2025 WL 2391446 (N.D. Cal. Aug.
18, 2025)

While not adopting
all plaintiffs’ arguments, the court certifies a limited class to challenge Tesla’s
full self-driving claims. I’m going to omit a lot, but the claims are the
usual California statutory claims
plus fraud, negligent misrepresentation, and negligence.

Of note, because Tesla
doesn’t pay for traditional marketing/advertising, “it reaches consumers
directly through its website, as reinforced by its own YouTube, Instagram,
press conferences, sales events, marketing newsletters, and CEO Elon Musk’s
personal Twitter account.” There’s a bizarre redaction of historical fact about
the prices offered to the public: “Tesla has historically offered customers the
ability to purchase or subscribe to optional technology packages—ranging from
[redacted] to [redacted] in price—designed to enable autonomous vehicle
operation.”

Plaintiff allegedly
relied on two misrepresentations to pay an extra $8000: (1) that Tesla vehicles
are equipped with the hardware necessary for full self-driving capability, and
(2) that a Tesla vehicle would be able to drive itself across the country
within the following year. Musk touted the hardware for “full self-driving for
driver-less capability” in 2016, claiming it was “in every car we make.” These
statements also appeared on Tesla’s website, including on the Autopilot, Model
S, and Model X subpages, and other places.

Hardware updates
followed, and “Musk later stated on a 2024 earnings call that a hardware
upgrade may be necessary for customers who purchased FSD with prior hardware
configurations.”

In 2016, Musk also
claimed that “we will be able to demonstrate a [demonstration] drive of our
full autonomy all the way from LA to New York.” He tweeted words to this effect
three times. Embarrassing: “While Musk’s Twitter account has over 200 million
followers, the 2019 Tweet generated around 2,000 engagements, and the 2017
Tweet generated around 300 engagements.” Also in 2016, “Tesla began displaying
a video that showed a Tesla driving autonomously, which remains on the Tesla
site today” and was also on YouTube.

It’s undisputed
that Tesla has not yet provided cross-country capability, and Tesla has not even
applied for regulatory approval to deploy a Society of Automotive Engineers  Level 3 or higher vehicle in California, which
is a necessary step for approval of a full self-driving vehicle. Before this
ruling, the court compelled arbitration as to one group of plaintiffs and dismissed
all warranty claims but permitted fraud-based, negligence-based, and related
statutory claims based on the statements above.

The court thus
certified a class of California purchasers/lessees who opted out of the arbitration
agreement or who paid before the arbitration agreement came in and who bought
or leased while the key statements were being made.

The number of
people estimated to be in the class was redacted (again, why?) but numerosity
was satisfied.  Commonality and
predominance were also satisfied because the case turned on whether Tesla’s
statements were deceptive to a reasonable consumer. Tesla argued that there was
no showing of class-wide exposure where there was neither a product label nor a
traditional mass advertising campaign.

Plaintiff met his
burden of showing class-wide exposure on the hardware statement, but not the
cross-country statement. The hardware statement was (1) on the “Autopilot”
subpage of Tesla’s website from October 2016 until August 2024; (2) on various
other subpages of Tesla’s website, including the “Model X” and “Model S” pages,
at points throughout that period; (3) disseminated by Musk at a high-profile
conference in 2016; (4) stated in a Tesla blog post published in October 2016;
(5) stated in a Tesla quarterly earnings call in May 2017; and (6) sent via
newsletter to prospective and current Tesla vehicle owners in 2016. “While
these channels alone may not ordinarily be enough to establish class-wide
exposure for a traditional car manufacturer, Tesla’s distinctive advertising
strategy warrants a departure from the typical approach.”

Given Tesla’s
direct-to-consumer sales and lack of independent dealers, consumers are “highly
likely to visit the website when considering the purchase of an expensive
package such as EAP or FSD.” The undisputed evidence “indicates that the
Autopilot page is the principal source of detailed marketing information from
Tesla, and typically the only written source of such information, describing
the supported features and how they work. Additionally, consumers can order
those packages directly through the site.” Thus, “it is reasonable to infer
that almost all consumers spending thousands of dollars on the packages would
review Tesla’s description to make that decision.”

Further, “because
Tesla itself serves as the primary source of product information, it is
reasonable to infer that the few alternative sources available to
consumers—i.e., YouTube videos demonstrating self-driving capability,
word-of-mouth, news articles—reinforce Tesla’s core message that full-self
driving capability is on the horizon, even if they do not specifically contain
the Hardware Statement.” Plaintiff’s expert also supported this finding. However,
without the hardware statement on the Tesla site, “the remaining channels of
communication are insufficient to support an inference of class-wide exposure,”
which led the court to limit the class period to the time the statement was on
the site.

As with product labels,
“though some consumers may not read the packaging when opening an item, courts
have inferred class-wide exposure based on the ‘inherently high likelihood’
that consumers would have relied upon those representations when encountering
them in the course of purchasing the product.” Monthly Tesla website traffic
data did not show otherwise; Tesla contended that only a few thousand people
visited tesla.com/autopilot the related blog post:

But
this information has little bearing on the key issue of the proportion of FSD
purchasers who viewed those pages, as it is reasonable to assume that many
people visit the Tesla website for reasons other than to purchase FSD.
Moreover, the table does not include the number of monthly visits to the Model
X and Model S subpages, which also contained the Hardware Statement at certain
points throughout the relevant time period, and is missing large portions of
data (i.e., from January to November 2017 for tesla.com/autopilot). Indeed, the
view counts are consistent with a finding of class-wide exposure, as it appears
thousands of people on average—which does not include those using ad
blockers—viewed the Autopilot page and blog post each month throughout the
class period. Tesla has therefore failed to rebut Plaintiff’s showing of
class-wide exposure as to the Hardware Statement.

But the
cross-country statement was less well-disseminated (Musk only said it four
times and didn’t get much engagement when he did), so class-wide exposure was
not established.

Materiality is an
objective standard, and plaintiff showed it with testimony from a marketing
expert who explained that these statements were material “due to the objective
credibility of the speakers (i.e. Tesla itself and Musk, Tesla’s CEO and an
industry leader), existence of multiple channels conveying a consistent
message, centrality of statement to the product’s core qualities, and clear
nature of the promise.”

Tesla argued that its
disclosure on the Tesla website that FSD functionality was subject to
“validation and regulatory approval,” as well as other “manuals, contracts and
[ ] documents [that] made it crystal clear that the technology was for ‘driver
assistance’ and NOT to replace the driver” disproved materiality. But “a
consumer can simultaneously believe that his car has the hardware necessary to
enable full self-driving and that such functionality would only be released to
him after regulatory approval.” The “manuals, contracts and [ ] documents,” likewise
referred to a Tesla vehicle’s current capabilities, not the full self-driving
capability touted by Tesla and Musk as being possible using the existing
hardware. Nor did the testimony of a “handful” of customers perceiving the
Hardware Statement to be “mere puffery” undermine the common evidence
demonstrating materiality, because the standard is objective. However, this
conclusion only applied to the FSD package, not a lesser package.

Tesla also argued
that falsity wasn’t subject to common proof because it kept tweaking the
hardware. But Plaintiff’s expert reviewed the sensor and compute configurations
for Tesla vehicles throughout the class period and testified that, for example,
“[t]he [in]ability for the sensors to perform in bad weather” is a limitation
that would be common across the different hardware versions. “Moreover, that
Tesla has been unable to demonstrate a long-distance autonomous drive with any
of its vehicles or obtain the required certifications to do driverless testing
in California further supports the lack of full self-driving capability across
the class.”

Damages were also
subject to common proof because plaintiff’s theory was that the appropriate
measure of damages would simply require refunding class members the amounts
paid for their purchases or subscriptions to FSD.

Nor would statute
of limitations issues preclude class treatment; individual application of a
limitation period to a class member rarely does. Also, the delayed discovery
rule and equitable estoppel theories of tolling “turn primarily on the
objective inquiry of whether Tesla’s misrepresentations to the class stopped a
consumer from discovering the cause of action or pursuing a lawsuit.”

The court also
certified an injunctive class of members of the classes above “who have stated
that they would like to purchase or subscribe to FSD in the future but cannot
rely on the product’s future advertising or labelling.” Tesla argued that this
was subjective, but ascertainability is not a requirement for certifying a Rule
23(b)(2) class.  And the requested
injunctive relief was clear enough: “Plaintiff seeks to stop Tesla from
continuing to state that its vehicles have the hardware capable of full
self-driving until the vehicles are actually able to do so.

from Blogger http://tushnet.blogspot.com/2025/08/class-certification-partly-granted-in.html

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Recommended reading: Jessica Litman, Authorship Nonsense

 Read it here.

Abstract:

Copyright law’s primary device for promoting progress is to bestow
rights on the authors of works. Rights vest automatically and last for a
very long time. Authors’ choices to retain, license, or transfer those
rights fuel opportunities to communicate the works to their audiences.
The copyright system’s mechanisms for determining who authored works
(and therefore automatically obtained copyright rights) should be both
accurate and reliable, since misidentifications will undermine the law’s
working as intended. 

This article examines authors’ creation
of works and copyright law’s handling of authorship disputes. Many works
result from creative collaboration. Although the copyright statute
incorporates mechanisms for allocating rights among multiple
contributors, judges appear to be uncomfortable with severally-authored
works. Accordingly, courts have adopted rules that minimize, reallocate,
or erase the creative contributions of inconvenient collaborators.
These well-settled rules are nonsense, neither well-reasoned nor
probative. They complicate and confuse our efforts to identify the
author and owner of copyright in a work, and exacerbate power
disparities in unbalanced creative ecosystems. 

from Blogger http://tushnet.blogspot.com/2025/08/recommended-reading-jessica-litman.html

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court rejects Schedule A claims against sellers of compatible parts/accessories

Bestway Inflatables & Material Corp. v. Individuals,
Corporations, Limited Liability Companies, Partnerships, & Unincorporated
Associations Identified on Schedule A Hereto, 2025 WL 2380699, No. 24 C 11697
(N.D. Ill. Aug. 15, 2025)

When they tell you that Schedule A cases are against
counterfeiters, keep in mind that trademark owners are willing to call pretty
much anything “counterfeiting,” including ads for compatible parts. Here, the
court looks into the allegations—assisted by defendants who showed up—and concludes
that they’re implausible as to the fighting defendants (those who weren’t
dismissed due to settlement—which this result suggests may have been unnecessary).
What about the rest? The court allows them to show up on their own and repeat
the prevailing defendants’ arguments—which probably won’t do much to curtail
the practice absent some big fee shifts.

Defendants sell parts and accessories for above-ground pools
via internet storefronts on third-party platforms, including Amazon.com, where their
listings mention Bestway as a maker of equipment with which their products are
compatible. Each of defendants’ listings “states in some way that their
products are compatible with Bestway pools or meant for use in Bestway pools,”
e.g., one listing states that its cup holders are “[p]erfect for above ground
pools of brands such as Bestway, Intex, Funsicle, Summer Waves … Coleman, etc.,”
while another defendant’s listings state that its pool plunger valve is “for
Intex/Bestway/Coleman Pool[s]” and its pool pipe holder is “for Intex Bestway
Coleman Above Ground Pool,” and another says that its pool hose adapter is “for
Bestway for Coleman for Intex” and its joint hose connector is “for Intex
Bestway Coleman.”  

As a general matter, “it is not trademark infringement for a
manufacturer of parts to truthfully inform buyers that its parts will fit the
trademarked product of another manufacturer.” However, “the exact language of
the advertisement will be carefully scrutinized” to ensure that it is not
“confusing as to source, sponsorship, affiliation or approval.” Here, the
listings “plainly used the mark ‘Bestway’ not for any source-identification
function as to their own products, but only to indicate that their parts and
accessories are compatible with Bestway pools.” Each listing referred not only
to Bestway but also to at least one other manufacturer of above-ground pools,
such as Intex or Coleman.

Defendants pointed to an earlier Schedule A case, Roku Inc.
v. Individuals, Corps., LLCs, Partnerships, & Unincorporated Associations
Identified on Schedule A Hereto, No. 22-CV-0850, 2022 WL 1598208, at *4
(S.D.N.Y. May 20, 2022), which concluded that the holder of the “Roku”
trademark had not shown a likelihood of confusion based only on an Amazon
listing of a remote that was listed as “compatible” with Roku TVs, reasoning in
part that the fact that the remote had a “Roku channel” button did not
communicate sponsorship or a common origin with Roku-manufactured products when
there were also buttons for “Netflix, Hulu, [and] Disney+.” It was clear in
context that the defendant’s use of the term “Roku” in its listing referred to “legitimate
Roku products,” not to defendant’s own products. The same was true here. There
were no non-conclusory allegations of actual confusion or intent to palm off.
And, though “[a] superficial glance at the other likelihood of confusion
factors might seem to suggest that they favor Plaintiff, … any such assessment
would fail to account for context and common sense.” The mark was used “in its
simple textual form,” along with the marks of competing above-ground pool
manufacturers, “to inform consumers that their parts will fit the pools of
those manufacturers.” If “Bestway” had been in larger font than the rest of the
text or singled out in some other way, the result might have been different. [This
is nominative fair use without the label, deployed as implementation of Twiqbal.
If all we have to limit trademark rights is context, then it’s good for courts
to take context seriously. But the Seventh Circuit has a very distinct attitude towards common sense.] Here, the mention of other competitors signalled a
lack of source- or sponsorship-indicating use, suggesting that “Bestway” was
being used “not to indicate sponsorship but only to identify Plaintiff’s pools
as an example of one kind of pool that Plaintiff’s parts and accessories will
fit.” If these listings could infringe,

it is hard to see how anyone in
Defendants’ position could sell replacement parts without risking a trademark
infringement suit, short of offering an explicit disclaimer—i.e., “These parts
are not manufactured by Bestway, Intex, or Coleman.” Plaintiff has cited no
authority requiring such language in circumstances such as these, nor does the
Court see anything plausibly misleading or confusing in Defendant’s listings
that might require some such corrective disclosure.

The court didn’t reach “fair use” arguments as such because
confusion was implausible. Two other defendants filed motions for summary
judgment on similar grounds, but the parties hadn’t yet had an opportunity for
discovery; those defendants could now refile. (If the grounds were similar,
what more could discovery have revealed that would change the content of the
listings over which plaintiff brought suit?)

from Blogger http://tushnet.blogspot.com/2025/08/court-rejects-schedule-claims-against.html

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drug company plausibly alleged confusion about partnership but not falsity of “same drug” claims about Canadian imports

AbbVie Inc. v. Payer Matrix, LLC, No.
23 CV 2836, 2025 WL 2374490 (N.D. Ill. Aug. 15, 2025)

AbbVie sells the specialty drugs Humira, Skyrizi, and
Rinvoq. Payer Matrix is “an alternative funding provider that works with
self-funded health plans to lower their specialty drug costs.” AbbVie brought
various claims against Payer Matrix based on Payer Matrix’s alleged involvement
with AbbVie’s charitable programs, including AbbVie’s Patient Assistance
Program (PAP) and Co-Pay Assistance Program (CAP). AbbVie also brought claims
based on Payer Matrix allegedly facilitating the importation of AbbVie drugs
from Canada. The court allows some claims to proceed, including trademark
claims despite the sophistication of the consumers.

A RICO claim survived, amazingly enough.

Lanham Act false association: AbbVie’s complaint identified
a Payer Matrix presentation “showing AbbVie’s trademark-protected logo and the
trademarks of other pharmaceutical manufacturers under a title ‘We partner with
top manufacturers.’ ” OK, even I would not say “partner with” is ok absent a relationship.

On the other hand, the court also thought another statement
in a presentation plausibly suggested a business relationship, which seems
silly to me. Discussing a slide that included AbbVie’s logo under a title “Top
Manufacturers,” the presenter said pharmaceutical manufacturers were putting
specialty drugs “down two runways”:

One is the traditional plan sponsor
access system, by which you’re paying probably 1,000 times what it costs them
to make the drug, and then there’s another pathway you can follow, which is the
Manufacturer Assistance Program, and really, what these big pharma
organizations are doing is they’re allowing access on both sides, but frankly,
a lot of people don’t know how to get access to the side that’s significantly
reduced in cost, and they do it for a variety of reasons … but the bottom
line is we’re a model that’s actually helping plans tap into these programs,
which are overfunded and underutilized.

Then, back to something that is a bit more plausible, the
presenter “told his audience that by permitting Payer Matrix access to its PAP
and CAP programs, AbbVie was improving its reputation; earning a tax deduction;
and ‘expand[ing] the net of who they’re getting onto these particular drugs.’”
And then back to silly: AbbVie also alleged that other Payer Matrix “marketing
materials deceptively represent[ed] that its program leverages ‘extensive,
often unused funds made available by Pharma Manufacturers.’ ”

As a whole, “these statements could plausibly confuse a plan
sponsor into believing that AbbVie approved of Payer Matrix’s PAP and CAP
activities.” The court emphasized the bad “[w]e partner with top manufacturers”
slide, as well as an allegation that at least one plan sponsor working with
Payer Matrix “was led to believe and represented to its members that Payer
Matrix seeks ‘grant money’ from pharmaceutical companies to reduce the cost of
some specialty drugs.” But the court also highlighted the statement that AbbVie
“win[s] from a financial standpoint” by accepting patients into its “overfunded
and underutilized” PAP, reasoning that “a plan sponsor could rationally
understand such a statement to mean that AbbVie endorses Payer Matrix’s scheme
of enrolling members in the PAP.” This seems clearly fixable with a proximate
disclaimer (and eliminating the partnership language).

“Partner” was also not puffery, since it has a defined
meaning, i.e., “to join with another person or
organization in a business activity.”
Nor was client sophistication enough
to defeat the argument at the pleading stage.

As to drug importation, AbbVie alleged that the medicines
Payer Matrix imports, or helps import, from Canada are “likely to cause
consumer confusion, given the material differences between these medicines and
their domestic counterparts.” AbbVie argued that it only needed to show a
material difference in the products, but § 1125(a)(1)(A) still requires a false
or misleading representation “likely to confuse or deceive their audience about
the plaintiff’s ‘affiliation, connection, or association’ with the defendant
‘or as to the origin, sponsorship, or approval of his or her goods, services,
or commercial activities.’ ”

And “the closest AbbVie comes to meeting this mark is its
allegation that Payer Matrix advertises RxFree4Me’s Canadian-sourced medicines
as the ‘same brand medications.’” That “says nothing about whether AbbVie
sponsors or approves of the drugs’ importation and the processes and procedures
through which the importation happens.” Thus, it wasn’t plausible that AbbVie would
be held “responsible for any medicine shipping delays and any counterfeit,
adulterated, mislabeled, ineffective, or spoiled product that [patients]
receives through Payer Matrix’s program.” And, while “same brand” “inherently
suggests some affiliation or association between AbbVie and the imported
AbbVie-branded drugs, AbbVie also alleges nothing to suggest that this
intimation was, in fact, false or deceptive.” This is a really useful point
about grey market goods—if they’re imported not for resale by someone who
understands they’re importing, then there’s really nothing misleading even if
there are material differences.

False advertising: AbbVie challenged: (1) advertisements on
Payer Matrix’s website saying that patients will not experience any disruption
or change in their specialty drug access, (2) statements Payer Matrix made to
doctors during drug-conversion efforts, (3) statements made to plan sponsors,
brokers, and doctors about AbbVie’s restrictions on PAP access, (4) Payer
Matrix’s representations that the imported AbbVie medicines come from
“legitimate and valid” sources, and (5) Payer Matrix’s statements about
partnering with AbbVie.

Ads claiming no disruption or change in access: Payer
Matrix’s website read: “[M]embers are not disrupted and always receive their
medications. There is no interruption in supply, no requirements to change
brands or dosing, the only difference is the source of the medication, and of
course the reduced costs.” AbbVie alleged falsity because (1) “members do in
fact have interruption in supply, including medicine delays,” (2) “Payer Matrix
does ask the members’ [health care providers (“HCPs”)] to change their medicine
brands when Payer Matrix is unable to maneuver the members into AbbVie’s PAP,”
and (3) “the statement that ‘the only difference is the source of the
medication’ misleadingly suggests that Payer Matrix is the members’ new
insurance provider for their specialty drugs.”

Payer Matrix argued that AbbVie’s injury was not proximately
caused by these statements.  But “AbbVie’s
theory of economic harm is plausible: when the advertisement turns out to be
false, customers may very well wrongly blame AbbVie—not Payer Matrix—for
interruptions in supply or changes to their medications…. At this early stage,
AbbVie plausibly pleads under Lexmark that its reputation was harmed by
the allegedly false representations on Payer Matrix’s website.”

Statements to doctors: AbbVie alleged false and misleading
statements to doctors that the patients no longer had the ability to obtain
their AbbVie drug and that the HCPs, therefore, had no choice but to change
their prescriptions.” Allegedly, “Payer Matrix employees would typically tell
the HCPs that the patients were uninsured for specialty drugs and/or no longer
had access to AbbVie’s PAP, often disparaging and blaming AbbVie in the
process.”

But these statements weren’t made “in commercial advertising
or promotion.” Whether this violated other laws was “beside the point”: when talking
to doctors, “Payer Matrix was not trying to ‘promote’ or ‘advertise’ anything”
but to persuade doctors to switch prescriptions. “[I]f Payer Matrix were trying
to promote its services, the ‘relevant purchasing public’ would be plan
sponsors and their brokers—not doctors.”

Alleged disparagement campaign: Payer Matrix emails
allegedly stated that: (1) “AbbVie has cut off PAP access to any patients
working with third parties and patient advocacy groups,” (2) “AbbVie has shut
the door on PAP to those who are underinsured,” (3) “AbbVie has been converting
existing Humira patients to Skyrizi for financial gain,” and (4) “AbbVie is no
longer accepting PAP applications at all.” Again, these weren’t commercial
advertising or promotion, but rather statements made in the course of “providing
services it had already agreed to provide”:

While some cases suggest that
statements made to a company’s existing customer base can support a Lanham Act
claim, the statements still must “advertise” or “promote” the company’s product
or services. These statements plainly did not. If anything, as Payer Matrix
points out, the statements would have deterred customers from working with
Payer Matrix “given that AbbVie[’s] own allegations contend that the accessibility
of PAP programs is a necessary prerequisite to Payer Matrix’s business model.”

Statements about imported drugs: AbbVie alleged that Payer
Matrix falsely claimed “that the medicines obtained through its importation
program … come from ‘legitimate and valid sources,’ despite the fact that
these medicines are being illegally imported from outside the United States.” This
was ambiguous: “generic words such as ‘legitimate’ and ‘valid’ cannot
reasonably be construed as synonymous with ‘FDA-approved’ or ‘FDCA-compliant.’
” Also, Payer Matrix said that, as part of RxFree4Me’s international drug
sourcing program, “[m]embers receive their same brand medications delivered to
their door for a $0 copay.” AbbVie didn’t allege that the imported medicines
are not actually AbbVie-brand medicines. A reasonable person would not be
misled into thinking that “same brand” means “same regulatory approval
process.” Motion to dismiss as to these allegations granted.

Partnership/approval statements: Again, partnership was
objectively verifiable and “plainly goes to the nature of Payer Matrix’s
services.” (The other statements, though, seem at least ambiguous to me.)
Still, it was “plausible that a plan sponsor listening to Payer Matrix’s
presentations could be misled into thinking that AbbVie endorses (and even
aids) Payer Matrix’s methods for enrolling its members in AbbVie’s PAP and CAP
and that this plan sponsor would be persuaded to procure Payer Matrix’s
services as a result.” [What harm does this do AbbVie?]

State law claims: Illinois Consumer Fraud and Deceptive
Business Practices Act (ICFA), tortious interference, and common law fraud
claims all turned on whether Payer Matrix misrepresented members’ coverage
status. When facilitating its members’ PAP applications, Payer Matrix submitted
requests to AbbVie saying that its members were “responsible for 100% of the
cost of their drugs or that their drugs have been excluded from their plans’
formularies.” To the contrary, AbbVie alleged that the member’s employer (i.e.,
the plan sponsor) had every intention of covering the cost of the drug if the
member was ultimately denied from AbbVie’s PAP. It alleged that Payer Matrix’s
“clients’ amended [Summary Plan Descriptions] … commonly contain language
informing members that their specialty drugs will continue to be covered by the
plan if Payer Matrix is unable to obtain alternate funding” and that Payer
Matrix’s client brochures and marketing materials say the same, “confirming
that overrides are granted as a matter of course when PAP admission is denied
and that the purported specialty drug exclusion is a sham.” Thus, AbbVie
plausibly alleged that Payer Matrix misrepresented the truth when it
communicated to AbbVie that members were responsible for 100% of the cost of
their drugs.

Payer Matrix argued that AbbVie did not rely on the submissions
“given that [AbbVie] conducted independent benefits investigations,” but AbbVie
alleged otherwise. And Payer Matrix was plausibly responsible even if patients
formally certified the forms, given allegations that Payer Matrix (1) submitted
the forms knowing they falsely represented the members’ insurance status, (2)
concealed the relevant terms from patients who signed the applications, and (3)
provided PBMs and plan sponsors with the forms template.

ICFA: As a non-consumer, AbbVie needed a “consumer nexus,” that
is, it needed to show that “the alleged conduct involves trade practices
addressed to the market generally or otherwise implicates consumer protection
concerns.” Non-consumers need to show that their actions were akin to a
consumer’s actions. “Consumer protection concerns” are implicated where the
defendant’s conduct “involves sharp practices designed to mislead consumers
about a competitor” or “public health, safety or welfare issues.”

AbbVie didn’t satisfy this standard. “Even if Payer Matrix’s
allegedly deceptive conduct might ultimately hurt specialty drug patients,
AbbVie does not act in a role akin to a consumer when it accepts or denies
patients from its PAP and CAP.” While consumers could be harmed by delays in
getting their drugs, having prescriptions changed unnecessarily, and related
uncertainty, the harm to AbbVie was primarily economic: “an increase in the
operational costs associated with its patient assistance programs and a loss of
sales.” Operational and financial issues are distinct to access-to-health-care
issues, and awarding AbbVie economic damages would not “serve the interests of
consumers.” Dismissed with prejudice.

Illinois Uniform Deceptive Trade Practices Act: the prohibitions
on confusion and false advertising parallel the Lanham Act, above. AbbVie
argued that, “for IDTPA liability, deceptive statements do not have to occur in
the context of commercial advertising.” But an IDPTA claim requires
“advertising,” and the Seventh Circuit has previously applied its Lanham Act
standard unchanged, so the court didn’t agree.

Tortious interference: In Illinois, a plaintiff must prove:
“(1) his reasonable expectation of entering into a valid business relationship;
(2) the defendant’s knowledge of the plaintiff’s expectancy; (3) purposeful
interference by the defendant that prevents the plaintiff’s legitimate
expectancy from ripening into a valid business relationship; and (4) damages to
the plaintiff resulting from such interference.”

To the extent AbbVie’s tortious interference claim relied on
Payer Matrix’s facilitation of imported drugs from Canada, AbbVie’s claim failed
because there were no allegations that Payer Matrix made any false or
misleading statements about the imported drugs or that Payer Matrix falsely
said they are FDA-approved.

However, Payer Matrix’s facilitation of PAP applications and
drug-conversion efforts could plausibly be tortious interference.

Common-law fraud: AbbVie alleged that Payer Matrix fraudulently
represented to AbbVie that PAP applicants lacked commercial insurance coverage
for Skyrizi, Humira, and Rinvoq, even though the plans guaranteed coverage for
those medicines if they were denied PAP benefits. This requires: “(1) a false
statement of material fact; (2) defendant’s knowledge that the statement was
false; (3) defendant’s intent that the statement induce the plaintiff to act;
(4) plaintiff’s reliance upon the truth of the statement; and (5) plaintiff’s
damages resulting from reliance on the statement.” This was plausibly pled.

from Blogger http://tushnet.blogspot.com/2025/08/drug-company-plausibly-alleged.html

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court finds unique tracking of units of fluoride products immaterial even if vaguely safety-related

Method Pharmaceuticals, LLC v. H2-Pharma, LLC, 2025 WL
2298395, No. 2:20-cv-753-ECM (M.D. Ala. Aug. 8, 2025)

Method asked the court to reconsider its ruling granting
summary judgment on certain false advertising claims to H2, which sells a fluoride
product as a supplement; the court declined, elaborating on its consideration
of materiality. (Claims of false advertising as to FDA approval are still
pending.)

At issue in this opinion is serialization (serial number tracking
so each unit is unique). The court previously found that serialization was not material to
the purchasing decisions of participants in the fluoride pharmaceutical market.
The theory here was that market participants falsely believed that H2’s
products were serialized, which contributed to their purchases.

Ignoring the procedural context, H2’s evidence indicated
that customers don’t purchase based on serialization but primarily consider the
price and available volume. The record evidence included contracts between
wholesalers and manufactures not requiring serialization. Also, the FDA did not
begin enforcing serialization until 2023—three years after H2 changed its label.

It was insufficient to argue that serialization was material
because it was an “inherent characteristic.” “[T]he ‘inherent quality or
characteristic’ formulation adopted by [the Eleventh Circuit] does not replace
the consumer-oriented nature of the materiality inquiry with a scientific one.”

Method further argued that consumers expect fluoride
products to be serialized, because consumers expect a product to comply with
federal law. But that reasoning would require the court to make a finding that
it couldn’t without intruding on the FDA’s jurisdiction: whether H2’s fluoride
products are dietary supplements (as H2 promotes them, and which need not be
serialized) or prescription drugs (which must be). Plus, there wasn’t evidence
that consumers falsely believed H2’s products complied with federal law in a
manner that affected their purchasing decisions; specifically, there wasn’t
evidence that consumers think the products are FDA-approved prescription drugs.
 

There was also a dispute over Walgreens, which allegedly
agreed that Method’s and H2’s products were not substitutable, which Method
argued indicated that serialization was material to Walgreens. But Walgreens
continued to substitute H2’s fluoride products for Method’s even after Method
sent Walgreens a copy of the original complaint in this case. “If serialization
was as material to Walgreens’ decision as Method claims, Walgreens likely would
have ceased … substituting H2’s products for Method’s, which Walgreens did not.”
(There are also contractual failure-to-supply penalties involved; Method “never
asked Walgreens the question about the reasons underlying its decision to find
H2’s and Method’s products different.”)

Finally, Method argued that serialization relates to safety
and is therefore material. “While the Court accepts the basic premise that
safety concerns may be material, the Court is not persuaded in this instance
because Method again does not show that customers make purchasing decisions
based on a preference for serialized or non-serialized products because of a
difference in safety.”

from Blogger http://tushnet.blogspot.com/2025/08/court-finds-unique-tracking-of-units-of.html

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7-11% oversupply of caffeine in energy drink wasn’t plausibly material

In
Re: Prime Energy Consumer Litigation, No. 24 Civ. 2657 (KPF) (S.D.N.Y. Jul. 31,
2025)

You
can tell how this will go from the first sentence: “For those consumers seeking
a jolt of energy in caffeinated-beverage form, does the inclusion of a smidgen
more caffeine than advertised amount to a deceptive practice?” The plaintiffs alleged
that Prime’s energy drinks contain 15-25 milligrams more caffeine than the 200
milligrams represented on its labels and in its advertising. The label states:
“CONTAINS: 200mg OF CAFFEINE PER 12 OZ SERVING[.]” On the side is an icon of a
lightning bolt with the language: “200mg CAFFEINE[.]” But, plaintiffs alleged,
“based upon testing commissioned by Plaintiffs’ attorneys, the Products
actually contain between 215-225 milligrams of caffeine rather than the
advertised 200 milligrams.”

First,
the court finds the falsity allegations insufficient, lacking information about
“how many cans of the [Products] were tested, when they were manufactured, when
and where they were purchased, and how the cans were selected for testing.” Merely
alleging that the tests showed extra caffeine wasn’t enough. Even though plaintiffs
aren’t required to disclose all the details of their testing at the pleading
stage, they need some. For example, a plaintiff could rely on a press release
from the New York City Department of Consumer Affairs announcing a preliminary
finding that Whole Foods’ New York City locations had systematically
overcharged customers for pre-packaged foods by overstating the weights of the
products, but the press release explicitly stated that the “DCA tested packages
of 80 different types of pre-packaged products and found all of the products
had packages with mislabeled weights. Additionally, 89 percent of the packages
tested did not meet the federal standard for the maximum amount that an
individual package can deviate from the actual weight[.]”

“That
is more information than Plaintiffs have provided here.” The court noted the
absence of information “as to the number of cans tested, whether various
flavors were tested, whether various lots were tested, and, importantly, how
many cans tested actually contained more than 200 milligrams of caffeine.”
Plaintiffs don’t have to prove the accuracy of their findings or the rigor of
their methodology, but they do need “some non-conclusory factual allegations as
to the alleged testing.”

Separately,
even accepting the allegations, it wasn’t plausible that an oversupply of
such a small percentage was materially misleading. The complaint
indicated that consumers of energy drinks “are generally seeking more caffeine,
not less, as evidenced by their desire to purchase the Product in the first
place (in comparison to, for example, purchasing a cup of coffee or a can of
Red Bull, each with about half the caffeine content).” The label “energy drink”
and the lightning bolt icon indicated that consumers “want a substantial amount
of caffeine. Therefore, it defies common sense to suggest that it would be
material that the Products contain a mere 7-11% additional caffeine — the exact
thing those consumers are seeking.”

Plaintiffs
suggested that the amount of caffeine was always material, particularly where
adverse reactions to overdoses could occur (e.g., with children). “However, it
is inconceivable to this Court that a consumer singularly focused on purchasing
a beverage with a significantly-above-average concentration of caffeine would
be concerned, much less disturbed, by the inclusion of a tiny bit more caffeine
in that beverage.” Children were a red herring; none of the plaintiffs was a
child, nor were there allegations that children consumed the drinks and
suffered side effects. Given the allegations that there is “no proven safe dose
of caffeine for children” and that the cans themselves contain a warning that
they are “not recommended for children,” an oversupply couldn’t be material. this
action.

Also,
one plaintiff alleged that he’d be willing to buy the products again if they
were properly labeled, indicating that the alleged 7-11% difference in caffeine
content wasn’t in fact material to him.

Finally,
and perhaps of even broader import, the court noted in dicta that it didn’t
think there was any injury from merely purchasing a misdescribed product.
(Citing Small v. Lorillard Tobacco Co., 94 N.Y.2d 43, 56 (1999) (holding that
“customers who buy a product that they would not have purchased, absent a
manufacturer’s deceptive commercial practices,” have not suffered an injury
under General Business Law § 349).) The court disagreed with Second Circuit
cases finding that alleging that consumers either paid a price premium or would
not have purchased the products if they had known the truth sufficed under NY
law.

Claims
under other states’ laws, along with warranty, unjust enrichment, and fraud
claims also failed.

 

from Blogger http://tushnet.blogspot.com/2025/08/7-11-oversupply-of-caffeine-in-energy.html

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New article: History and Tradition in First Amendment Intellectual Property Cases: A Critique

 Preprint available here.

Abstract

There are indications that the “history and tradition”
approach the Supreme Court applied to gun rights and abortion
restrictions may be coming for First Amendment doctrine. In intellectual property cases, it already has, with the Court using historical analogies for the right of publicity, copyright, and trademark. Unlike in the Second Amendment context, where the Court has reasoned from things earlier regulators didn’t
do to strike down gun regulations today, in “history and tradition”
First Amendment law the Court has reasoned by broad analogy to allow new
speech restrictions.   

One lesson is that the history and
tradition approach does not meaningfully constrain Justices even in
low-political-salience areas like copyright and trademark, outside
highly politicized contexts. The manipulability of levels of generality
in making historical analogies has been justly criticized, but the IP
cases provide a particularly clear contrast in outcomes from those in
the Second Amendment cases, despite putatively using the same method of
looking to historical models before—and even in place of—applying a
means-ends test or other non-analogic scrutiny.

from Blogger http://tushnet.blogspot.com/2025/08/new-article-history-and-tradition-in.html

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Visual comparison in online contract formation

Cody
v. Jill Acquisition LLC, — F.Supp.3d —-,
2025 WL 1822907, No. 25-CV-937 TWR (KSC) (S.D. Cal. Jun.
30, 2025)

I wouldn’t usually blog a consumer class action that was
just about arbitration, but I want to highlight this one because of the use of
images. Not only does the court include the visuals of what the consumer saw
(in the course of deciding that the arbitration agreement wasn’t clearly enough
disclosed to be binding), it compares those to visuals from past cases. However, it ultimately distinguishes cases that are visually similar because of the different context–a one time purchase as a “guest” compared to signing up for an ongoing relationship. Whether or not you agree with the result, kudos to the judge to looking beyond text to what the precedents actually showed.

This is otherwise a standard “deceptive
discount/misleading reference price” case. JJill argued that the plaintiff agreed
to arbitrate.
 

She
first had to click “add to bag.”
 

Then
“continue checkout.”
 

She
was then prompted to add her shipping address and select a shipping method:
 

Then a payment method:

 

Then “Proceed
to Order Review” and the order review page:

 


Directly above the “Place Order” button was this statement: “By clicking ‘Place
Order’ you agree to J.Jill’s Terms of Use & Privacy Policy.”
“Terms of Use” was a blue, underlined hyperlink. Those terms explicitly called
attention to the arbitration clause at the top of the page:

 

There
was a section called “Binding Arbitration Agreement and Class Action Waiver
under the “DISPUTE RESOLUTION” heading.

It
was undisputed that the plaintiff didn’t have actual notice. “[A]n enforceable
contract will be found based on an inquiry notice theory only if: (1) the
website provides reasonably conspicuous notice of the terms to which the
consumer will be bound; and (2) the consumer takes some action, such as
clicking a button or checking a box, that unambiguously manifests his or her
assent to those terms.” “This test has two aspects: the visual design of the
webpages and the context of the transaction.”

Conspicuous
notice “is a matter of whether an advisal is ‘displayed in a font size and
format such that the court can fairly assume that a reasonably prudent Internet
user would have seen it.’ ” The Ninth Circuit “deemed the [below] notice
insufficient”: 
 

“The text disclosing the
existence of the terms and conditions on the[ ] websites [wa]s the antithesis
of conspicuous” because it was “printed in a tiny gray font considerably
smaller than the font used in the surrounding website elements, and indeed in a
font so small that it [wa]s barely legible to the naked eye,” whereas “[t]he
comparatively larger font used in all of the surrounding test naturally
direct[ed] the user’s attention away from the barely readable critical text.” Further,
the hyperlink was “simply underscore[d],” without the “[c]ustomary design
elements denoting the existence of a hyperlink[,] includ[ing] the use of a
contrasting font color (typically blue) and the use of all capital letters.”

More recently, the Ninth
Circuit concluded that, “[c]onsidering the [following] notice in the full
context of the transaction, [it] would not expect a reasonably prudent internet
user to be on inquiry notice of the contract” because “[t]he advisal [wa]s not
… located directly above or below the action button and [wa]s displayed in
relatively small text.”

But
the Ninth Circuit approved different displays as sufficient: 

With these, “a reasonable user would have seen the notice
and been able to locate the Terms via hyperlink” because the “notice [wa]s
conspicuously displayed directly above or below the action button” and “the
‘Terms of Use’ hyperlink [wa]s conspicuously distinguished from the surrounding
text in bright blue font, making its presence readily apparent.”

Another Ninth Circuit
case “found a single screen sufficiently conspicuous”:

This one “explicit[ly]” included “clear and legible”
“notice on the final order review page, directly below key information such as
the purchase total, and directly below the button [the plaintiff had] tapped to
complete his purchase … on an uncluttered page[,] … not hidden or obscured”
with “the hyperlinked phrase ‘terms of use’ … colored bright green—contrasted
against the surrounding white background and adjacent black text” and “the same
color as other clickable links on the page, suggesting clearly that it is a
hyperlink.”

Also, the Ninth Circuit
reversed a district court order that found that these images failed to provide
reasonably conspicuous notice:

The
relevant admonition was “[d]irectly beneath the operative Play button,” “[t]he
design elements use[d] ‘a contrasting font color’ making the notice legible on
the dark background,” and “the sign-in screen lack[ed] clutter and use[d]
‘[c]ustomary design elements denoting the existence of a hyperlink.’ ”

Here,
the notice at issue was visually on the acceptable side. While the text of the notice might
be “considerably smaller than the font used in the surrounding website
elements,”
it wasn’t “so
small that it is barely legible to the naked eye,” or placed on a cluttered
page or obscured. Nor was it in a color lighter than surrounding text of a
similar size. The hyperlink was both underlined and in a blue font, like other
hyperlinks on the page. “Finally and critically,” the text of the notice was directly
below the “Place Order” button, not “outside of the user’s natural flow.”
 

But
that wasn’t enough. Courts also have to “consider … the ‘full context of the
transaction,’ ” … such as whether the type of transaction ‘contemplates
entering into a continuing, forward-looking relationship’ that would be
governed by terms and conditions.” Courts are more likely to conclude that a
user anticipating “some sort of continuing relationship” would expect to be
bound by terms, whereas a user “who simply purchases goods or avails herself of
a one-time discount offer” would be less likely to form such an expectation. Relevant
considerations include: (1) whether the transaction contemplates a
“continuing relationship” by creating an account requiring a “full registration
process,” (2) whether the user is entering a “free trial,” (3) whether a user
enters “credit card information,” and (4) whether the user has downloaded an
app on their phone, representing an intent to have continued access to the app.

Here,
the plaintiff opted to check out as a guest, distinguishing this case from others
where the Ninth Circuit found inquiry notice. The California Court of Appeal
noted that “most consumers would not expect to be bound by contractual terms”
when engaging in a “trivial” transaction like “the sale of a single item, such
as a pair of socks.” Because “the onus must be on website owners to put users
on notice of the terms to which they wish to bind consumers,” defendant failed
to meet its burden of establishing that its notice was sufficiently conspicuous
to bind the plaintiff to arbitration.

 

from Blogger http://tushnet.blogspot.com/2025/08/visual-comparison-in-online-contract.html

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IPSC: Closing plenary: DOGE; the First Amendment (me!); and the 50th anniversary of the Copyright Act

David Schwartz (Northwestern Pritzker School of Law),
Christopher Cotropia (The George Washington University Law School), DOGE Days
at the USPTO? Evidence from a Natural Experiment in Administrative Reform

PTO provides some employees w/union protections and others
not. As soon as DOGE hits, nonunion staff productivity goes way down, while
examiner productivity remains constant. Admin has acknowledged patent examiner
union; did not try to enforce return to office mandate.

Staff makes sure drawing is sufficient and application has
all necessary parts. There’s a lot of activity; staff does more than examiners—total
nearly 53% of events while applicants represent about 30% (necessary activity
before next step is triggered for someone else), and examiners do the rest. There’s
a strong correlation b/t how busy examiners are and how busy staff is. Relatively
parallel trends.

But after DOGE, activity dropped—not because people were
fired/left although examiners dropped by 1% and staff dropped by 5%; result
holds even normalized by employee—a 40% drop in productivity for staff and
nothing significant for examiners.

What if threat of tariffs spooked applicant behavior?
Checked for that; enormous PTO backlog makes unlikely, but maybe it could delay
responses to OAs. Even when we sample to just account for things where
applicant delay won’t matter, same results.

Implications: significant costs from admin reforms like
DOGE. Abrupt intervention in administrative state that created a lot of
uncertainty & ambiguity. Unappreciated benefit of benefits of unions/job
security: unions are accused of resisting change. Will be studying longer term
effects as well.

We didn’t look at quality, but we did look at whether they
changed the mix of things they did (maybe initial responses are easier) but
they didn’t.

Rebecca Tushnet (Harvard Law School) History and Tradition
in First Amendment Intellectual Property Cases

I’m going to skip over as much IP doctrine as I can make
myself ignore on the theory that most of you know at least some of Zacchini,
Eldred, Golan, Jack Daniel’s, and Elster. I’m going to focus on trying to draw
connections between the First Amendment IP cases and what we might expect from
seeing history and tradition as a method expand to more of the First Amendment.

The news is not good. “History and tradition” as
constitutional theory is originalism unconstrained by textualism. Unlike in the
Second Amendment context, where the Court has reasoned from things earlier
regulators didn’t do to strike down gun regulations today, in “history and
tradition” First Amendment law the Court has reasoned by broad analogy to allow
new speech restrictions.

This is not a result of politicization, even if the adoption
of the method is politically driven because originalism wasn’t getting the
right results. It is the result of the impossibility of using history and
tradition without a theory of how to make good analogies from the past to the
present. History and tradition thus does not meaningfully constrain Justices
even in low-political-salience areas like copyright and trademark.

Most discussion of the risks of Bruen-izing the First
Amendment has so far focused on the risks of reviving speech controls in their
historical form such as blasphemy, obscenity, and unfettered defamation law.
The IP story shows that it’s worse than that: it is fully possible to appeal to
history and tradition to further expand control of speech beyond historic
limits. At a bare minimum, the considerations present in other modes of free
speech reasoning—the considerations involved in tailoring regulation to
regulable harm—remain necessary even when consulting history and tradition.

As Richard Fallon noted, the strict scrutiny test “evolved
simultaneously in a number of doctrinal areas” by the 1960s and quickly came to
“dominat[e] numerous fields of constitutional law.”  Strict scrutiny as a standard means that the
government must show that its actions were “narrowly tailored” to further a
“compelling government interest,” and that they were the “least restrictive
means” to further that interest. In First Amendment cases, it is usually strict
in theory and fatal in fact.

Not too long ago, the Roberts Court seemed destined to use
strict scrutiny liberally to invalidate many government speech regulations. The
court struck down campaign finance laws, privacy laws, and anti-animal crush
video laws, and in 2015, the Court announced that strict scrutiny would apply
to all content-based regulations, including noncensorious regulations like
those of a city trying to specify which signs can go where and for how long.
But, the composition of the federal courts has changed, and the Supreme Court
is clearly open to throwing out decades of precedent.

In the Second Amendment case Bruen v. New York, the Supreme
Court held that only gun restrictions that met a stringent historical
compatibility test would be allowed. But judges are rarely trained historians,
and history tends not to speak in one voice. Reflecting some of the resulting
problems, in a followup case, Rahimi, a majority of the Court reiterated that
its test did not require a “historical twin,” but rather a “historical
analogue.”

To understate matters, it is not yet clear what constitutes
a sufficiently close analogy. One possibility is that the analogy is
sufficiently close when the Court tells us it is. But that’s not law.

Any serious attempt to apply history and tradition as a
legal standard has to grapple with the well-known challenges of analogical
reasoning. And unfortunately the IP cases do not suggest that the Court will be
able to do so.  The unifying factor in
the First Amendment IP cases is their reliance on history and tradition to
uphold a speech restriction whose contours had been substantially expanded from
those known when the Constitution—or the Fourteenth Amendment—was adopted.

In the gun cases, the Court begins with the presumptive
coverage of gun rights (the people have such rights, for self-defense) and then
looks for whether history approves of the challenged limits on those rights. In
the First Amendment IP cases, the Court does not begin with the presumptive
coverage of “the freedom of speech,” but rather with the historical
compatibility of intellectual property claims with free speech. This sets up
the result: new IP rights are also fine.

In Zacchini, for example, the Supreme Court consistently
characterized the conflict as one between the television station’s First
Amendment rights to report news and the performer’s interest in his “entire
act,” the latter of which was equivalent to a well-recognized common-law
copyright claim.  Lower courts then
immediately disregarded the Court’s analogy and started approving almost
anything called “right of publicity.” But Common-law copyright in an entire
performance is very different from controlling any mention or evocation of an
identity. Bruen-type attention to the right of publicity’s different subject
matter (what Justice Thomas called the “how” of regulation) and justifications
(what he called the “why” of regulation) compared to copyright could have
helped limit overreaching claims.

More recently, the Court used history and tradition to
reject two First Amendment challenges to new copyright legislation. Rather than
analyzing whether these changes were speech regulations subject to intermediate
or strict scrutiny, the Supreme Court reasoned that term extension and creating
federal copyrights where none had previously existed were both things Congress
had done before, so no additional First Amendment analysis was required. 

As long as Congress acted within the “traditional contours”
of copyright, the Court told us, its acts required no further scrutiny. But
what are those traditional contours, since we know after Eldred and Golan that
those contours don’t include “a work’s term of protection is the term specified
when it was created” or “a work in the public domain stays in the public
domain”? Copyright’s subject matter, covered rights, and scope of what
constitutes infringement of a right have all expanded dramatically since the
Founding. I should note that I don’t generally oppose these expansions; my
argument is instead that the thing we call copyright is very different from
what the Framers called copyright, so saying that their copyright was
consistent with the freedom of speech doesn’t tell us an awful lot about our
copyright without a theory of how to compare theirs to ours even if “the
freedom of speech” remains constant.

The Court did identify fair use and the idea/expression
distinction as key traditional contours of copyright. But Congress has passed
laws that cut sharply back on fair use in the digital context. Lower courts
both before and after Golan have said it’s constitutional to prohibit
“circumvention” of digital access controls even if that makes many fair uses
impossible. If your only guideline is “traditional contours” and there is a
history of contracting freedom to use copyrighted works, then it’s difficult to
tell when the traditional contours have been unconstitutionally reshaped.

Even more recently, trademark law has seen the same
untethered use of history and tradition. In Jack Daniel’s, the court
essentially reasoned that, because trademark law is historically grounded,
source-identifying uses that cause deception must not be part of the speech
historically protected by the First Amendment.

But there are even worse problems with the analogy to
founding-era trademark than there are with analogizing to founding-era
copyright, given the lack of a substantive federal registration system until
the mid-20th century, the vast expansion of subject matter, and the vast
expansion of what constitutes infringement, not to mention the invention of
dilution.

Then, in Vidal v. Elster, most of the Justices appealed to
history and tradition as supporting the names clause that bars registration of
a living person’s name without their consent. But the cracks in history and
tradition were finally noticeable even to them: Should the analysis be at the
level of the purpose of having a trademark registration system? A registration
system needs to make content based distinctions to function. Does that mean
that any content-based regulation is ok? That would allow Congress to, for
example, deny registration to any trademark that made reference to birth
control or abortion. That’s a very broad analogy.

Justice Thomas’s opinion for the Court relied on the long
tradition of providing unfair competition protection to names in tort lawsuits
brought by the person whose name it is, as well as of allowing people to use
their own names in commerce even when someone else has already used that name
in a line of business. That is, “a tradition of restricting the trademarking of
names has coexisted with the First Amendment … Though the particulars of the
doctrine have shifted over time, the consistent through line is that a person
generally had a claim only on his own name.”

This is mostly true, but unhelpful: First, the reference to
“trademarking” a name is ahistorical because, historically, trademarks arose
from use in commerce. “Trademark” wasn’t a verb. The registration system is not
the same thing as allowing a private right of action for name confusion. This
is a clear example of how the history and tradition approach expands judicial
freedom—Justice Thomas didn’t even seem to notice that he was generalizing from
individual private infringement suits to a government-run registration system
that bars certain registrations even in the absence of private opposition.

Second, even if we accept the jump between private tort
claims challenging specific uses and a statutory restriction on registration,
that common-law history has an obvious link with Section 2(a), the prohibition
on false association. Section 2(c) goes further—its only independent utility is
when it applies to a mark that wouldn’t falsely suggest a connection. Barring
registration of DEMOCRATS AGAINST ELON MUSK doesn’t seem like it’s going to
facilitate source identification. This is especially true given the difference
between registration and actual use: Even without a registration, Elster can
(for now) sell his TRUMP TOO SMALL T-shirts, thus inflicting the same source-
or reputation-affecting consequences on the world.

Bruen directed courts to consider whether new gun
regulations were sufficiently analogous to past ones in the “how” and the “why”
of their burden on a law-abiding citizen’s right to armed self-defense. By
contrast, in Elster, Justice Thomas’s opinion ignored both the how of past
regulations—through infringement claims—and the why—fraud prevention instead of
protection for a free-floating interest in personality.

Justice Barrett’s concurrence was attentive to this gap. As
she wrote: “[T]he Court’s evidence, consisting of loosely related cases from
the late-19th and early-20th centuries, does not establish a historical
analogue for the names clause.” The ability to cherry-pick a few cases out of
the historical record allows for a lot of manipulation, especially in a
common-law nation where there is no such thing as an unbroken, consistent line
of cases.

The majority approach has both a timing problem and a
conceptual problem. For timing, why is the late-19th and early-20th century
important when it was neither the Founding nor immediately around
Reconstruction? Conceptually, Barrett wrote: “[T]he Court never explains why
hunting for historical forebears on the restriction-by-restriction basis is the
right way to analyze the constitutional question.”

A key issue is that the founding era had comparatively few
laws and more reliance on judicially recognized causes of action than we do
now. In common law adjudication, even when judges articulated general
principles, they were applying them to particular facts, so limiting principles
that weren’t presently relevant in the case before them were often omitted from
discussion. Perhaps more importantly, the analogy between the historical
caselaw and a statute would have to come from identifying the rule emerging
from the caselaw and comparing it to the statute. And any grouping of cases to
give a “rule” has to have an underlying theory of what unites these cases: a
classic level of generality problem. “Historical cases were about protecting
rights when names were used as source-identifiers” is one theory, but so is
“historical cases were about protecting rights when names were used deceptively
as source-identifiers,” which creates a different baseline.

History and tradition is probably going to play a bigger
role in future First Amendment cases, as this year’s Paxton v. NetChoice
decision upholding age verification requirements for certain websites
signals.  In Paxton, the Court used a
history of regulating minors’ access to obscene-for-minors speech to identify a
legitimate state interest in identity verification legislation. But website age
verification is unlike brick-and-mortar age verification because it can potentially
be saved for government review or exposed to hackers (something that just
happened with the identity verification for a women-only app, Tea and its male
competitor TeaOnHer), and it is very expensive, as opposed to the very low
marginal cost of checking IDs in a store staffed by humans.

The broader lesson is that a law’s overbreadth,
underbreadth, and harms compared to the alternatives for achieving the
government’s interests are necessary considerations, but ones not facially
addressed by history and tradition. History simply doesn’t supply its own
analytic framework, and “sufficiently close analogy” is not all that helpful.

The flabbiness of history currently works differently for
different constitutional rights. Most of the work of the history and tradition
test in Second Amendment law comes from what legislators didn’t do—they didn’t
regulate guns in particular ways. In the First Amendment context, by contrast,
courts have extrapolated from private rights courts and legislatures granted in
the past to allow them to grant new and expanded private rights in the present
for similar reasons. Anti-gun regulation judges can dismiss inconvenient past
examples of gun regulation as misunderstandings. Pro-IP rights judges can seize
on outlier cases, or simply use the general justifications for IP rights
expressed in past cases and treat them in isolation from the countervailing
considerations that formerly limited those rights.

The expansion of relevant evidence beyond text to any
practice (or nonpractice) of legal regulation aids in the project of judicial
freedom: In such a vast corpus, who could deny that there must be some errors
and misunderstandings in there? At the same time, judges can dismiss
inconvenient past limits on IP rights as matters of legislative grace, and can
always find at least some expansive descriptions of the private interest at
issue, which then justifies further expanding the scope of the right.

The manipulability of levels of generality in defining an
interest grounded in history and tradition requires more legal tools than are
currently on display—and those tools cannot be found in “the past.” They
require interpretation and judgment.

Therefore, although the tiers of scrutiny may be shaky for
various reasons, the concerns they implement will not go away. In the First
Amendment, those animating concerns include: worry about government suppression
of views it doesn’t like, whether by viewpoint-based laws or laws that in
practice discriminate against particular viewpoints; related worry about
government’s ability to identify when speech actually causes harm rather than
just causing upset; not unrelated but separate concerns about overbreadth and
underbreadth, where poor targeting of a regulation may reveal bad motives or
just unwarranted discrimination against certain kinds of speakers when other
speech causes the same harm but remains unregulated.

One useful question is whether a speech restriction matches
well to the putative harm it addresses. If its harm-prevention claim relies on
an extended causal chain that could be interrupted by other factors, or is
unpersuasive as a justification for the law at issue because of the amount of
harmful speech it leaves untouched or the amount of harmless speech it
suppresses, then we should identify a constitutional problem.

That is, considerations of fit—usually considered as part of
the second and third prongs of strict or intermediate scrutiny—cannot and
should not disappear even if the “compelling government interest” and
“substantial government interest” standards are replaced by a test that
requires the government interest asserted to be recognized by US history and
tradition. Indeed, tailoring concerns are likely the only way to evaluate
whether newly enacted laws are consistent with a history and tradition of
allowing some speech regulations and not others. Historical analogies can start
us off, but we will still need to ask about tailoring and alternatives.

Zacchini, the right of publicity case, could even offer us a
potential model if we took the historical analogy seriously as a limit on what
lawmakers can enact, as in the Second Amendment context. After all, there were
reasons why common-law copyright in unfixed performances didn’t prevent most
reporting about what people said or looked like.  Better still though would be to take on
directly the project of identifying the relevant government interest and the
extent of a regulation’s impact on speech that ought to be protected.

[very good questions I didn’t get a chance to write down,
sorry! Among others, Mark Lemley suggested a Bruen-type approach: if they didn’t
do it before, they can’t do it now. There’s a lot of debate in the broader con
law literature, but I think it’s probably more important to make sure that the
competing interests are defined at the same level of generality—freedom to
choose nonconfusing marks, for example, instead of freedom to use someone else’s
name in a nonconfusing way, if you’re going to describe “source indication” at
a very high level of generality as a justification for the names clause.

Jake Linford asked whether the relatively recent historical pedigree
of strict scrutiny gave me any pause. No. First, I carry no brief for strict
scrutiny as such; European congruence and proportionality also provide tools to
address causation/harm/tailoring issues that history & tradition can’t
alone address. Second, there is a difference between a constitutional
commitment and how that constitutional commitment is implemented. NYT v.
Sullivan is a good example—defamation was well known as a legitimate cause of
action, but its dangers were also well known and the SCt thought we’d learned
enough about them to put new procedural barriers in place. Another example I
didn’t mention is the Miranda warning—when we know that specific problems recur,
we can change our implementation of the constitutional guarantee even as the
guarantee remains the same.]

Elizabeth Townsend Gard (Tulane University Law School), Zvi
Rosen (University of New Hampshire Franklin Pierce School of Law), 50 Year
Review of the 1976 Copyright Act

Gard is new EIC of J of © Society; looking back on 50 years
and forward to next 50 years b/c Next Great © Act seems unlikely. Doing
interviews w/prominent scholars/lawyers/legislators. We want to take a snapshot
of © in 2026, so engagement is welcome; there’s going to be a conference at GW
in Oct. 2026. Younger scholars encouraged. Copyright Society Research Guides: for
scholars to use.

from Blogger http://tushnet.blogspot.com/2025/08/ipsc-closing-plenary-doge-first.html

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IPSC: Comparative & International IP

Karen Sandrik, Marquette University Law School, Cultural
Legacies and Innovation Barriers: Comparative Lessons from Post–Soviet Research
Institutions for American Innovation Policy

Slovakia: Comenius U press release about first official patent
sold/assigned by a Slovak university. They spent a year negotiating the deal.
Have more than 10 tech transfer centers established in the past 15 years;
partnerships w/ various institutions; EU membership has played a role. Despite
actually staffing the tech transfer centers, didn’t see any interaction b/t gov’t
or institutions or even w/in institutions, b/t industry and academia, b/t
industry and gov’t—no real interest in collaboration. Therefore no contracts.
What are the barriers? Contractual? IP? Something else?

Slovakia offers a cautionary tale of what happens when you don’t
have what we have in the US. We prioritize partnerships, relationships with
colleagues, synergies; we get annoyed by being asked to do things cross-campus
or with other universities. When you don’t have trust and open science, you don’t
have risk tolerance or the ability to withstand short-term bad outcomes for
long-term investment/relationships. Rational survival strategies that were in
place for good reasons can become hard-to-change embedded behaviors even after
they lose their justification. Lesson: US is at risk of losing more than grants,
but losing the culture that supports innovation.

Communist Party of Slovakia; Czechoslovak Academy of
Sciences, established 1952, became centerpiece of scientific research. Universities
were just for teaching. Publications were vetted; collaboration wasn’t allowed;
you minimize dependencies on institutional promises and keep your head down. Good
work still happens!

1989: Velvet Revolution. 1993: Velvet Divorce. 2004: EU
membership. Stephen Kotkin & Mark Beissinger: Historical Legacies of
Communism: An Empirical Agenda: Key concepts for her: parameter setting: past
experiences limiting future options; cultural schemata: embedded ways of
thinking that persist.

Ewa Morawska, Malleability Paradox: Communist-era copying
strategies for temporary work/cross border trading thrived in Western capitalist
markets. Why? “Beat the system” mentality: (1) circumventing official channels
when they seem ineffective or risky; (2) prioritizing short-term opportunism
over long-term institutional relationships; and (3) placing greater trust in
personal networks than formal institutional processes—she saw that in her own
research. This isn’t dysfunction or irrationality, but a rational learned
response. But it makes collaboration and innovation in research labs hard.
Materials sharing, personnel sharing etc. require formal contracting.

Interviewed people at tech transfer offices, gov’t
officials, industry experts, and lawyers. They spoke of “protecting” researchers
who had demands on their time; that wasn’t their job to work across institutions
or fields; avoiding “free work.” People didn’t even know about IP Center on
campus; tried to introduce people and they resisted—our job is to work for our
students and respond only to our dean; the tech office would just want free
work from us. What about visiting PhD students? Why would we do that? We are
different scientists with different research.

Quasi-activity: you seem to be doing a lot of work but you’re
not really engaging underneath. Putting out an article about a new relationship
b/t university and patent center that doesn’t actually happen.

Are we creating the conditions for our own beat-the-system
mentality? Researchers avoiding politically sensitive topics (Fulbright grants
cancelled for 2025-2026 w/ informal advice to avoid certain topics in new
applications). Increased isolation: prohibition on giving funds to foreign
researchers.

Protecting innovation isn’t just about funding—it’s about culture
legacies, safety, mindset.

How do we protect innovation culture during political tensions/disruptions?
The quicker the disruption, the longer it tends to hang around.

Andrew Gilden: what is the actual compensation system and
measures of career advancement in Slovakia? Do grants matter? If I don’t get
rewards, then should I have to deal with some jerk in another department?

A: In Slovakia, one interviewee’s institution gives money
for patents, but was going to take it away b/c people were gaming the system by
getting useless patents. Practical implementation isn’t there. We need to get
people thinking about downstream uses, not just immediate results.

Sean Pager: Institutions talk about wanting to promote
interdisciplinary collaboration but rarely do much about it; some specifically
targeted grants. Also teaching: can be hard to teach an interdisciplinary
class, but that’s one way to reach people in other fields.

A: yes, and also in tenure we get credit; structure isn’t
there. Also some react: we just got academic freedom, so don’t tell me what to
do.

Peter Yu: is this a setback (more dangerous, as in Russia)
or a legacy? Think about how other people are motivated in the same system,
e.g. post office workers.

Felicia Caponigri: Italy as contrast: researchers/members of
bureaucracy think of themselves as having one space for one person. To
write/get credit you have to ID the part of a coauthored piece that you wrote,
which is the opposite of coauthoring. Maybe it’s a civil law thing more than a
post-communist thing?

RT: Patent example made me think of the accusations that
China was rewarding US TM registrations with bonuses, leading to a bunch of
junk; that wasn’t the whole story (Amazon might have been more important), but
they stopped giving the bonuses. Maybe the solution can’t be internal to the
field; maybe it has to be about the overall economic growth potential of the
economy as well as the level of social trust.

Peter Yu, Texas A&M University School of Law, Twists and
Turns in the TRIPS Journey

Before TRIPS, fewer rights were recognized internationally.
Remedies/enforcement issues have not been as successful. Do developed countries
have a comparative advantage? TRIPS sought to promote rule of law/dispute
resolution mechanism. Hope was international rule of law. Still have WTO
appeals and arbitration, but until we’re willing to support an independent body
it won’t function again?

One position: TRIPS doesn’t result in mutual gain but
rewards for multinational companies. Patent, TM registrations—developing countries
have been doing quite well. PCT users—top is China; Madrid TM registrations,
China is 3d. India is 9th in patents, 22nd in TM. Russia
25th and 13th respectively. China, Malaysia, India,
Thailand, Brazil in top 50 of world innovation index. TRIPS boomerang (Jerome
Reichmann): when you force countries to raise their own standards, they learn
how to take advantage of the global system. Many developing countries want to
protect their own IP and most of all to take down trade barriers, but the
return of unilateral trade sanctions from the US means the agreements were not
successful in preventing that. Even before Trump, Section 301 meant there wasn’t
a full success. Transition periods keep getting extended for LDCs.

Investment requires imitative capacity + large enough market.
If a developing country doesn’t have both of those, they won’t get investment
no matter what the legal regime.

No denying good result that TRIPS put IP on a pedestal. When
people make policy decisions, they now think about IP. Ordinary citizens might
know something about IP. Second: Gone to more complex regimes: WIPO as well as
WTO, and then a bunch of smaller regimes like ECPA. That will stay for a long
while b/c one has a lot of technical expertise (WIPO) and one has dispute
resolution mechanisms (WTO). TRIPS negotiators deliberately avoided tackling
new technologies—internet/digital communications, emerging when negotiated;
biotech—could have done more than just a single provision. TRIPS/WTO unlikely
to tackle AI or genetic engineering, leaving room for WIPO.

Final questions: would TRIPS negotiators have anticipated
current IP developments? No. So should we be historical or evolutionary in our approach?
Panels like to follow the Vienna Convention on the law of treaties, but if
questions weren’t anticipated, should we be historical?

Can TRIPS be amended? Wouldn’t be negotiated today. Not easy
to amend, but there are some small possible tweaks like periodic review; more emphasis
on innovation instead of IP; more regulatory coordination w/regional entities.

Can TRIPS withstand growing international rivalries? We’ve
seen worse—wars, pandemic. TRIPS isn’t good at responding to those crises, but
it can withstand it.

Q: say more about small tweaks. What is a small tweak?

A: TRIPS enshrined 90s standards, but the discourse of IP
has changed a lot. Innovation focus rather than “IP” as such. Might need more
provisions. More coordination with other regimes.

RT: Does future proofing mean more rules or fewer? I’m
thinking of how fast TDM training exceptions were adopted across the globe, and
then basically 2 years later “generative AI” emerged and lots of people said “no,
not like that.”

A: more flexibilities, more policy space. More rules = more
difficult for lots of countries. A lot of developing countries lack
institutional capacity to handle complex rules. More opportunities for people
to come in from MNCs or donor orgs or developed countries to deliver systems
that get even further away from what IP rules are supposed to do.  

One scenario: US withdraws from WTO and China steps in to be
leader. If that’s the case, resources will be given like Belt and Road
initiative. That’s concerning for a lot of countries. Other possibilities: WTO
suffers same fate as other UN orgs and has to pull back.

China: We are moving from patents and TMs to trade secrets
as comparative advantage. Debate shifted from patents to confidential
information—interesting for emerging countries.

Pager: more investor state dispute resolution as a model?

A: you can appeal WTO panel decision, but you have to set up
the panel; most countries are not happy.

Dr. Gururaj Devarhubli & Dr. Taruna Jakhar (Zoom), Nirma
University, Institute of Law, Ahmedabad, Analyzing Cross–border Regime for
Enforcing Copyright in the Age of Digital Piracy: A Comparative Study of Music
Piracy in India and China       

Focused on emerging economies/major content markets with
contrasting enforcement landscapes. Focused on music piracy due to global
reach, high revenue loss, and evolving modes (torrents, streaming, mobile apps,
p2p platforms, Telegram, etc.). Shift from physical to digital; rise of private
streaming leaks. Use of VPNs, mirror sites, cloud storage.

Cross-border enforcement issues: territoriality of ©; lack of
unified takedown procedures; inadequate int’l coordination. Key cases in India
allow dynamic injunctions (2019) and dynamic-plus (2023); super-injunction against
piracy on websites and applications including Facebook etc. (2025). Challenges:
slow litigation, ISP noncompliance, weak criminal enforcement.

China comparison: multiple enforcement agencies including IP
courts. Administrative (faster) and judicial (more legal clarity). Challenges:
over-reliance on administrative path; selective enforcement; trade tensions influence
compliance.

Both are TRIPS compliant and WIPO signatories; both struggle
w/online enforcement due to tech limitations; both involve private sector in
enforcement; piracy persists due to affordability gaps and weak deterrence.

Tech/private actors: India relies on dynamic injunctions,
court monitored takedown notices, w/poor enforcement. China: Tencent and
NetEase have invested in AI-based piracy detection. Globally: YT Content ID, Spotify
watermarking, Apple music anti-leak policies. Problems: inconsistent
enforcement by platforms, small creators lack access to tech tools, and
cross-platform leaks remain untraceable.

Who acts when content is hosted abroad? Pirates use VPNs and
aliases; lack of global consensus on enforcement standards; while Indian
dynamic injunctions have extended to foreign domains, Chinese takedown orders
are not enforceable in India.

Recommendations: bilateral cooperation agreements; platform
accountability standards; collective licensing expansion; cross-border evidence
protocols, and harmonized safe harbor provisions. Need joint enforcement by
streaming platforms/music labels; promotion of fair pricing models to reduce
demand; strengthening int’l digital IP diplomacy through WIPO.

Yu: should you drop China from your paper? US Special 301 reports claims that legality of content online for China is 96%–a lot of content is
licensed. The issue they still have is that the licensing rates are extremely low because Tencent has a monopoly. If you want to say there’s a big digital piracy problem on Chinese online
platforms, the data will be from 5-10 years ago.

RT: how different is the practical legal situation from US
or Europe? Here, Litigation isn’t super fast; companies still whine about
playing whack a mole b/c of the DMCA notice and takedown process; overseas sources
don’t comply with takedowns and the US is a big enough market that it’s worth
overseas entities creating targeted sites, and we don’t have dynamic
injunctions against third parties; litigation is expensive and if not as slow
as India not very fast compared to pace of commercial life. Just saw Bechtold’s
excellent paper on Content ID’s gaps—tech solutions are very limited. The key
question seems to be whether licensed access can be simple and cheap enough to
compete with piracy. 0% piracy would require the elimination of humankind; that’s
not needed for sufficient incentives and a thriving industry.

A: Doing pay per view on general video platforms could be a
game-changer.

from Blogger http://tushnet.blogspot.com/2025/08/ipsc-comparative-international-ip.html

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