WIPIP, part 2

Posted on February 10, 2017 by rtushnet
H. Brian Holland, We Are All Cyborgs Now: A Cognitive Theory
of the Third-Party Doctrine
Once upon a time there were categorical protectsion for
private papers against search & seizure. Courts then ruled that personal
property was no longer categorically exempt from search and seizure.
Distinction b/t papers and other effects was broken down.  There’s a warrant requirement, though.  But an exception if the gov’t’s acts aren’t a
“search” under the 4A.  A search occurs
when the gov’t violates a reasonable expectation of privacy.  Third party doctrine comes in to show there’s
no reasonable expectation of privacy. Voluntary assumption of the risk that a
third party would disclose to the gov’t—gov’t needs only subpoena or similar
process.
Sotomayor: Ill-suited to digital age, given our sharing of
more information with more third parties. 
“Sharing” means something different—not just intentional tangible
exchange. Not necessary to commercial relationship; now baked into basic
tech.  Personal papers stored on third
party servers such as those of Dropbox—covered by 3d party doctrine even though
there may be no person on the other end! 
Does not comport w/reasonable expectations of privacy.
What is to be done?  First,
personal papers are not mere effects, which are separately mentioned in the
4A.  Worthy of special, if not
categorical, protection.  Specifically,
3d party doctrine should be narrowed to protect personal memory artifacts that
are created, communicated, and stored on tech designed to structure, replace or
augment human memory.  Looking at
cognition and memory, linking function to doctrine.  Related to the idea of embodied cognition and
the extended mind.  These cognitive
memory artifacts are part of our cognitive systems; should be protected b/c of
relations b/t 1A, 4A, 5A—they play a role in freedom of thought and freedom of
conscience.  Linked to idea of security
of persons.  Bodily integrity linked to
autonomy, dignity, and identity—the extended mind is also an extension of the
body.
Consistent w/other theories; passes Orin Kerr’s test of
being tech neutral in the sense that you don’t gain a benefit as a criminal by
using digital tech.
Many people agree that the 3d party doctrine should be
curtailed but we haven’t had a theory w/a judicial impact.  My solution: reinvigorate “papers” as a distinct
object of protection w/their own theory. 
Problem: b/c of the history, there’s little literature on the protection
of papers under the 4A; most is focused on the place where the papers were
found—the home—and the papers as property. But that’s not descriptively
accurate any more.  Should we look at
scholarship on creativity? 
RT: Skeptical that would help b/c it’s not clear that papers
are different—thinking about Erving Goffman & Peggy Radin, where it’s
possible that other property will be equally important to personhood.  Framers?
A: they said nothing about why they used both papers and
effects! In England, the history is largely about searches for (seditious)
pamphlets, which ended up being found in the home but were intended for broad
distribution; in the US, the history is largely about searches for untaxed
items/tax records.
Q: Recent case—police got pacemaker data—under 3d party doctrine.  But if he wanted to get the information himself,
DRM might have prevented him from
doing that. 
Stacey Dogan: what’s the line?
A: there is no absolute line—some people take pictures of
everything they want to remember.  I’d
rather look at the 3d party instead of the particular use.
Dogan: but you may lose people who don’t believe that a song
in your cloud storage is a personal appendage.
Amanda Levendowski, Fair Use for Fair Artificial
Intelligence
Lots of scholarship on biased AI.  There are lots of ways to introduce bias—the people
creating the algorithms; the data selection; data classification. IP
scholarship hasn’t addressed how © can channel AI.  E.g., training facial recognition algorithms
on white faces.  Amazon’s same-day
delivery rollout didn’t include Roxbury, predominantly black area—result that
people in that area didn’t get the same access. 
ProPublica’s investigation of machine learning algorithm for reoffending
after exiting the prison system; African-Americans were assigned higher risks
for lesser crimes. This could change bail, sentencing, parole for the
worse.  Likelihood of arrest was related
to overcriminalization/overpolicing in predominantly black areas.  Word mapping: Google News showed gendered
patterns.  Neutral: king is to man as
queen is to woman.  Man is to computer
programmer as woman is to homemaker—the algorithm picked up bias by reading
human works.  Training an AI on the Enron
emails is going to be based on the habits of a bunch of white oil & gas
guys from Texas.  Latanya Sweeney: people
searching “black” names aren’t going to get good job ads and are likely to get “search
for a criminal record” ads instead.  This
isn’t how we should train our algorithms.
Low-friction data (easy to acquire) are biased.  Twitter firehose: API allows most tweets to
be used in research. Userbase skews young, white, and urban—made Hurricane Sandy
look like it was centered in Manhattan, not Rockaway where they lacked
electricity.  Wikipedia: largest CC
source of data: fewer than 10% of active Wikipedia editors are women. If you’re
using Wikipedia for low-risk natural languages training, you get the bias of
the people who edit Wikipedia.  Same
thing happens with public domain books, and judicial opinions (largely written
by old white guys w/degrees from Harvard and/or Yale).
Solution: Google Books. 
Messy ethical question: do we actually want our robots to be really good
at recognizing people, or talking to us?
Q: Copyright Compendium’s argument that copying by a machine
isn’t expressive at all?
A: Compendium’s focus is whether computers can author.  It’s not copying, it’s scraping; there are
different words for the same thing. But Judge Koh in Meltwater was very
concerned about scraping that ignored robots.txt.  It wasn’t a true CFAA case, but the idea of
scraping can create issues with CFAA.
Alex Roberts: what’s the protected by copyright but unbiased
corpus that could be used instead?
Q: works by feminist authors or those w/intersectional approach,
post-1923.  If you want a robot that
doesn’t code homosexual as a slur, you need recent books.
Tiffany Li, Robots vs. Animals: Toward a Unified Theory on
Intellectual Property Rights on Non-Human Creators
Elephants paint; the monkey selfie; computers or algorithms
can create art or new discoveries. No consensus on applying IP principles to
those two categories.
Why does this matter? 
Today’s science fiction is tomorrow’s science fact.  What incentivizes non-humans?  Should we try to do so?  Do we only want to incentivize human
creativity?  Fairness theory: should
trees have ©?  Who determines who the
creator was if there’s no human author? 
Personality theory: does a nonhuman have any moral rights?
Monkey selfie: is the author the person who pressed the
button on the camera? Or the person aware of the work being created?  David Post says pressing a button b/c it
makes a funny sound isn’t authorship b/c authorship requires an awareness that
a work is being created.
Algorithms don’t work the same way computer generated art
does. Right now our computers are not aware of an act of creation. If we
consider authorship as only something human, there’s no point in discussing
this, but I’d argue that what creativity is shouldn’t be limited to humans—there
will almost certainly be AI that can decide to create, or will create what
looks like the same mode as human.  Ultimate
Q: what does it mean to create, produce, or author a work?  Comparing computers to animals can lead to
interesting conclusions about envisioning a photo v. clicking a button. 
RT: Why care? Compare this question to 3D printing, which
also to me raises “why care” questions insofar as the principles seem pretty
similar even if the outputs are different.
Holland: does it matter whether it’s the animal incentivized
by the click of the camera or the computer incentivized by its
programming?  If the point of © is more
works, which is a big if, then would it matter whether it was a human?
Cathy Gellis, Testing the Limits of the Section 230 IP Exemption
Stealth provision from Sen. Wyden to counteract the rest of
the CDA—to make sure that censorship wouldn’t be too easy.
Trademark, not part of the Progress Clause—why does it get
shoved under the rubric of intellectual property?  Paper tries to explore that.  How do we figure out what IP is?  Why do we think that, and can we push back on
it?  One reason this is important: lots
of people use workarounds.  Lots of
people frame their problems as © problems; Google v. Garcia was not about the
film’s distribution being harmful for reasons that had anything to do w/©.  Registrars are willing to break anonymity too
easily—anonymous speech is protected by the 1A. So she wants to get TM out of
230 to avoid evasion.
There are other things that go wrong. In the 9th
Circuit, the IP exemption means federal IP; other circuits, and even California
state law, include state based IP claims.
Dogan: Need to argue on two levels: if you’re making an
argument that this statute should be interpreted to exclude TMs, you have to
look at the legislative history to figure that out.  Even though there’s been pushback against use
of IP as a label more broadly, it’s undeniable that in common parlance lots of
people include TMs as IP.
A: there doesn’t seem to be legislative history on this.
Dogan: can you fix this if © workaround still exists?  You generally want there to be less liability
for intermediaries and this is a way you think you can get there—more persuasive
to give a principled reason.
A: one of these things is not like the others.

Silbey: since 230 was supposed to be easily operable
immunity, the idea that it was exempting federal criminal law and IP should
also be easily identifiable as such.  One
might think registered IP could be included. 
What is IP is too hard a question to answer, but which IP for easy
on/off immunity switch might be easier. 
Could also be how people claim the IP, rather than preemption.

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WIPIP part one

Posted on February 10, 2017 by rtushnet
Works-in-Progress Intellectual Property Colloquium
Boston University School of Law
Opening Plenary [missed beginning due to travel]
Timothy K. Armstrong, Symbols, Systems, and Software as Intellectual
Property: Time for CONTU, Part II?
Functionality is still a problem. Altai seemed to work well
for a while; at least intellectually consistent w/treating software as variety
of literary work. But Oracle v. Google threw that out; said it only applied to infringement,
not to scope of protection for software. 
If there’s different ways to write code, then your particular way is
copyrightable.  Meanwhile, patentability
of software advanced here, though not in many other countries.  Congress might not have considered
patentability in AIA.
CONTU as a process: that was a worthwhile exercise, even if
you don’t like the results. Consider pros and cons of various types of
protections—we should do it again.
Wendy Gordon: maybe we should just punt—any functionality
concerns, court should not give TM/©.
A: Loath to endorse a result that might lead to thick patent
protection for software.
Dogan: if Oracle hadn’t happened, would you need this?
A: there’s still an Alice
question, but yes, Oracle is a big deal.
Lunney: if you argue for CONTU 2, shouldn’t you think that
CONTU 1 did a good job? CONTU specified specific amendments & Congress
followed, but you’re not happy w/specificity of results—any reason to think it would
be better this time?
A: That’s a question of outputs and I’d like to get some
input.
Betsy Rosenblatt: Look at current USPTO/NTIA/Copyright
Office roundtables etc.—may or may not be a black hole; §512 best practices was
totally anodyne. Can we really get a good agreement out of any group these
days?
A: Worth a try.
Rebecca Schoff Curtin, Zombie Cinderella and the Undead Public
Domain
ZOMBIE CINDERELLA for dolls initially refused for Disney’s
Cinderella for dolls—would have implied that Disney had exclusive rights to
Cinderella for dolls.  Overturned on
appeal, but TTAB relied on the idea that it was a weak component b/c others
were using the term in the market; at best highly suggestive. Denies rights
merely b/c commercial appropriation of the character wasn’t complete enough. We
should deny the first entrant into the doll market the right to control the
public domain character. Thus, we should extend aesthetic functionality to
cover elements in the public domain. Cinderella, when used w/dolls, connects
the dolls to the public domain figure, amplifying the possibilities for
play.  So too w/features of the tale that
connect to the tale—for Snow White, hair as dark as ebony and skin as white as
snow.  Non-reputation-related competitive
advantage is conferred by these elements.
Others have suggested aesthetic functionality for characters;
Zombie Cinderella enables us to step back from fraught cases of characters that
actually emerged under modern copyright (e.g., Betty Boop, Dorothy Gale).
Generic or functional for dolls? Rosenblatt has pointed out
that it may be hard to think of a character name as generic for the
character.  The goods are dolls, not
Cinderellas.  [Hm. I think they might be
Cinderellas, just like my son was a Stormtrooper for Halloween.]   Genericity
focuses too much on linguistics and not enough on the cultural work the term is
doing, a problem that could be exacerbated in a trade dress situation.
Wyatt Earp—public figure. 
Similar argument.  However, actual
applications haven’t been good. 
Superman, Batman, and Joker drawings as TMs for dolls; CCPA said that
there was no merit in the argument that the aesthetic features of the drawings
prevented TM function.  9th
Cir.: Betty Boop case; withdrew opinion applying aesthetic functionality. On
remand, the dct turned again to aesthetic functionality, but relied heavily on
finding D’s uses ornamental, not TM, use. 
Protection of feature as TM would thus impose significant
non-reputation-related advantage. That limits the potential for this defense a
lot—would not have helped ZOMBIE CINDERELLA, but why not recognize the
functional portions of each mark?
Lunney: Merry Xmas case for words on Xmas ribbon: words that
are functional; Damn I’m good TTAB decision w/that phrase for a bracelet.  Why focus on non-reputation-related
disadvantage and not other language, like important commercial ingredient in
success.
A: I’m afraid of Pagliero:
Justin Hughes says it’s been rejected.
Lunney: but it’s quoted directly by Breyer in Qualitex.  Brand value v. intrinsic value: ask whether consumers
would be better off if they were subject to competition in the market for
Disney character dolls.
Mark McKenna: be more radical—say it’s not for TM at all. It’s
not genericism, functionality: it’s Dastar—trying
to capture stuff that should be in ©. However badly © does with characters,
that’s copyright problem. Mickey Mouse may be hard, but the rest are all easy.
Q: explore failure to function/use as a mark.

Rosenblatt: aren’t you coming back to genericity? The signal being given is “this
is a Cinderella.”
A: I’m not saying just signalling is aesthetic functionality—Cinderella
Maids Service, Cinderella Eyebrows Spa, Cinderella Soap Co.  There is a lot of overlap w/genericity, but
it’s harder for product design. 
Concurrent Sessions 1
Andres Sawicki, The Law of Creativity?
Replication crisis in social sciences.  Social psychology is the main source of the
creativity literature—Teresa Amabile et al. 
Another red flag: creativity studies usually feature between-subject
study design, replicates at a lower rate than within-subject studies. P values:
doesn’t know the extent to which the literature upon which we’re relying is at
the .05 threshold; next step in project is to check this.  Effect sizes, another topic of investigated:
the larger an effect you see, the more likely it is that it’s replicable.  Studies may be underpowered; there may be
effects but you don’t see it in the subsequent studies.
Model specificity: standard IP (patent and copyright) model
is an artist or inventor facing choices whether to create.  Standard incentive thesis.  Creativity literature: we need a different
model; not sure what it is.  IP
creativity literature has adopted a motivation model or a cultural conditions
model.  Motivation: incentive thesis all
over again.  Should we be measuring the
number of works created over a certain threshold? More people choosing creative
careers? We should be more precise about the marginal benefit we want to
measure for giving IP rights.  Creativity
literature opens up the idea that we don’t just care about the $ going back to the
creator—attribution, control, something in addition to or instead of the cash.
Existing normative theories: incentive, natural rights,
capabilities. Implicit normative theory in the new literature: we should
maximize creativity.  It’s a good, but at the cost of what?  Does the literature itself have a normative
theory other than the maximization of creativity?
Jessica Silbey: When we’re comparing social psychology
literature to legal analysis of creativity through social psychology, there’s
an overarching disciplinary q of what/why those disciplines are asking when
they ask questions.  I appreciate the
replicability issue, but the larger q is whether we’re running experiments for
the same purposes, or what the import is for the discipline in which we’re
working.  Add to this project: theory of
what the law is supposed to accomplish in the first place.  Most of the social psych, sociology, anthro
work has a theory of the discipline that informs the experiment.
A: As legal scholars, what is our goal/responsibility in
drawing on other disciplines?  An
opportunity for interdisciplinary work. 
It’s not just an idea of describing creativity; he sees the idea as
maximizing creativity—or well-being, autonomy, competence, relatedness: we
should have debates about whether those are the normative aims we want to
promote. 
Sean Pager, A Unified Theory of Authors and Incentives
Criticism: current law’s “© directly induces creativity”
model relies on demonstrably false theories about creativity; sometimes
copy-skeptics want courts to call into Q the whole idea of copyright—straw man.   I
think this model oversimplifies and I want to rescue the incentive model from the
cloud it’s under.  Reframe what ©
incentivizes: creative investments, not creative works.  Piggybacking on Jonathan Barnett’s Copyright
Without Creators.  Investments in
post-creation commercialization.  This
explains a number of features of copyright doctrine.  He’s persuaded by most, but wants to refine
sharp dichotomy b/t creation and commercialization.  The commercialization process is chock-full
of creative acts/talent, that progressively adapt original authorial work into
derivative forms that represent original works of authorship.  Script development.  The industries are motivated by copyright;
that’s authorship that’s happening.  Most
clear in AV industries, but also recording, even publishing.
What about individual authors?  Are they just intrinsically motivated or does
© change the way authors behave?  There
are different types of authors.  Two such
types: the commercially minded creators—mercenary, Samuel Johnson non-blockhead
types.  Plenty of examples.  But what about the intrinsically motivated—does
© change their behavior?  Maybe they’re
creating out of love, but they also need to eat and pay rent, and sometimes
need inputs to create.  © leads people to
invest more resources, creating works of higher social value.  Does the market value social value directly? That’s
a caveat/something he wants to bracket. What about works the market doesn’t
value?  They’re not left entirely out of
the cold because of the derivative rights market.  People who want to direct films serve as
camerapeople on films—commercialization process puts more money in the system
that provides often well-paying jobs to creators while they’re waiting to
succeed; they gain training, skills, experience, personal contacts—so when they
can engage in passion projects they’re able to do so. A particular kind of
cross-subsidy. Also creative clusters subsidize individually motivated
creativity.  Lifetime career arc of
investment also leads to more investment in better creativity—just like pickup
softball players are intrinsically motivated, but pro sports leagues have
higher investments in skill and creativity and thus more entertainment value.
Q: Does anyone disagree w/your basic thesis?  Or are we arguing about what’s necessary to get creativity if that’s
what we want, given insistence by MPAA et al who show up to Congress claiming
that “we won’t get any creativity at all unless you make Google filter its
search results”?  That is, we are
interested whether Johnson was right about blockheads or whether he was at best
joking since that sentence is in his own diaries—and also in what tradeoffs we
are willing to accept in order to get these investments in specific types of
works, which may crowd out or suppress other types of works.  Perhaps we don’t want to bracket the question
of what’s valued by the market versus what we want in the universe of
creation.   Perhaps we’re interested in the gendered and
raced ways in which the standard paths of access are open to certain people—another
way to describe what you’re describing is ‘the old boys network.’
A: I was myself constructing a straw man of objections.
There’s an awful lot written that has oversimplified incentives. If you want to
disagree w/©’s incentives having acknowledged them, he’s cool with that.
Silbey: How important is the anti-copying protection that
exists today to the argument that they need to make money?  That is, money as an incentive versus © as an
incentive. The equation w/needing to earn a living and © as the means to earn a
living is not entirely clear to her.
A: not claiming that no one would engage in commercial
creativity w/o ©.  Marginal
increase.  Counterfactual models/marginality
is addressed in other papers.
Silbey: so anti-copying is the lynchpin?
A: other things too—moral rights, attribution—© has a
mismatch in the US but it does some work in this direction.  Some publish more b/c they have control.
Silbey: Control is different from $.
Sawicki: compare © to other mechanisms by which people earn
money for creativity.  Instead of NEA,
consider uniform basic income for creators.
Jorge L. Contreras & Jacob S. Sherkow, Dividing the Spoils
of CRISPR
CRISP is a way to edit DNA by removing, adding or altering
specific DNA sequences—like word processing for genetic sequences. Many
applications—disease-resistant crops, therapies for genetic disorders, etc.  Discussion of exclusive licenses from
universities—controversial in that they cede control to private companies not
bound by principles of more open practices. 
Surrogate licensing, to avoid obligations—including NIH models. It’s
profitable as a model and it has existed since Bayh-Dole.  Licenses can be made non-exclusive.  Groups will need cross-licenses from each
other—opportunity to take a step back and rethink exclusive licensing.
Q: don’t you need exclusive license to enforce?
A: that’s the concern—they can shut competitors out by
refusing to license; companies have legitimate economic rationale for
foreclosing competition.  Socially
suboptimal.
Aman Gebru, A Model Legal Framework for Intellectual Property
Protection of Traditional Medicinal Knowledge
The Hoodia story: patent granted on extract for weight
loss.  Companies eventually felt they
couldn’t produce a drug that would meet regulatory standards. There was no
provision for communities at first but companies were ultimately willing to
share profits w/them because of public backlash.
Traditional medical knowledge can be a shortcut in the drug
discovery process—one study found that TMK increased the chances of getting a
preliminary hit in plant screening from 6% to 25%. But it’s easily lost b/c of
primarily oral nature.  Encourage
investment in codification?  Gov’t investment
or subsidy; private investment (he thinks most efficient); secrecy
(inefficient); group cooperation (highly limited); first mover advantage
(little potential).

Contreras: hard to bind 100s of thousands of community
members w/o draconian legal regime.

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P&G fails to clean up “natural” suit over baby wipes

Posted on February 7, 2017 by rtushnet
Brenner v. Procter & Gamble Co., No. 16-1093, 2016 WL
8192946 (C.D. Cal. Oct. 20, 2016)
Brenner sued on behalf of a putative nationwide class and a
California subclass of those who purchased Pampers “Natural Clean” Baby Wipes.  The individual packaging is green and includes
stylized depictions of flowering plants, animals, and leaves:
The overall box is less ornate, but still greenish:

Brenner alleged that this packaging was “false and
misleading” because the Natural Clean wipes contained “an unnatural and
potentially harmful ingredient called phenoxyethanol.” An FDA press release advising
breastfeeding mothers not to use a particular nipple cream that contained
phenoxyethanol and another troubling ingredient describes phenoxyethanol as “a
preservative that is primarily used in cosmetics and medications” that “can
depress the central nervous system and may cause vomiting and diarrhea, which
can lead to dehydration in infants.” A May 2012 report from the French Agence
Nationale de Sécurité du Médicament et des Produits de Santé cautioned
consumers not to use wipes containing phenoxyethanol on infants under the age
of three because of concerns about the compound’s “reproductive and
developmental toxicity.” The FTC took at least two enforcement actions within
the past year against cosmetic manufacturers of “natural”-labeled products
because they contained phenoxyethanol. The FTC’s press release about the
enforcement actions describes phenoxyethanol as an “artificial ingredient[ ].”  Brenner brought the usual California claims.
P&G argued that Brenner didn’t suffer an an Article III
injury-in-fact because she could not have believed that Pampers Natural Clean
Wipes were free of synthetic chemicals, given her prior lawsuit against
Kimberly-Clark for its Huggies “natural & pure” baby diapers and “Natural
Care” wipes must have made her aware that “natural”-branded baby wipes aren’t
free of synthetic chemicals, including phenoxyethanol. The court refused to
conclude on a motion to dismiss that “any reasonable consumer who was allegedly
misled by a ‘natural’ label would, without question, research every ingredient
found in any similar ‘natural’-branded products to check for synthetic or
potentially harmful chemicals before making a purchase.”  Further, Brenner alleged that the problematic
chemicals involved in the other lawsuit were different, and that her transition
from Huggies to Pampers was a reasonable response after “learning that the
Huggies brand failed to meet her expectations.”  Thus, her allegedly deceptively induced
purchases constituted classic Article III injury.
Still, she couldn’t seek injunctive relief because she didn’t
allege an intent to purchase again if the labeling were fixed.
Because the California statutes use the reasonable consumer
test, they don’t require a showing of fraud unless the plaintiff alleges “a unified
course of fraudulent conduct and rel[ies] entirely on that course of conduct as
the basis of that claim.”  If a claim
only partially sounds in fraud, the court should disregard the allegations of
fraud and consider whether the plaintiff states a claim.  Here, the court wasn’t convinced that the
complaint sounded wholly in fraud. The general allegation that Defendant knew
about the FDA and French government findings didn’t “necessarily” imply that
Defendant made its “natural” claim with the intent to defraud; it was “equally
consistent with an inference that Defendant disagreed with these governmental
findings or found them irrelevant to its product.”
Under this standard, Brenner stated a claim.  The FTC, at least in certain contexts, views
phenoxyethanol to be “artificial” and thus not “natural.” This conclusion wasn’t
dispositive evidence of meaning, but it raised a plausible inference that a
significant portion of consumers could be misled. The product packaging, which
uses a lot of green and depictions of flowering plants, reinforced the
plausibility of misleadingness.  Also,
even if a reasonable consumer wouldn’t believe that a “Natural Clean” baby wipe
contained no synthetic ingredients, it was plausible that a reasonable consumer
would believe such a product did not contain any potentially harmful chemicals.
The bulleted text below the label, “unscented with a touch
of aloe,” was not enough to limit the “natural” claim: it wouldn’t prevent a
reasonable consumer from thinking that the claim meant anything more than “unscented
with a touch of aloe.”  The court refused
to find as a matter of law that a “natural” claim, unmodified by “100%” or
“all,” couldn’t plausibly be deceptive.  Likewise, the fact that “Natural Clean” was a
trade name didn’t prevent it from being deceptive; trademark law doesn’t
preempt California consumer protection law.
P&G also argued that the “Natural Clean” label couldn’t
be actionable because “natural” has no generally-accepted meaning. Most of the
dictionary definitions to which P&G pointed were clearly inapposite:
P&G definitely wasn’t claiming that its wipes are “based on an inherent
sense of right and wrong” (as in “natural justice”) or “relat[ed] by actual
consanguinity as distinguished from adoption” (as in “natural parents”).  But the more pertinent definition, “existing
in or produced by nature : not artificial,” was consistent with Brenner’s
allegations.
The FDA and FTC haven’t defined “natural,” but that didn’t
make deception implausible; both entities have indicated that misuse of the
term could be deceptive.  The FTC has
taken at least two enforcement actions against cosmetic manufacturers for their
use of “natural” claims because the product contained phenoxyethanol.  While the FTC has said that “natural may be
used in numerous contexts and may convey different meanings depending on that
context,” that just indicates that “natural” doesn’t have a universal meaning
across product categories; it could still have a falsifiable meaning in a given
context.
The court also declined to stay this action under the
primary jurisdiction doctrine.

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Latest additions to my collection

Posted on February 7, 2017 by rtushnet

Etsy is a font of interesting objects, including dollhouse miniatures, handmade jewelry, and even soaps (which would make good party favors for IP events, just sayin’).  Transformative works?

jewelry for teaching defenses by

dollhouse miniatures

handbag soaps

closeup on Chanel soap

closeup on LV soaps

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use of P’s jewelry in D’s ad is regular passing off, not reverse passing off

Posted on February 6, 2017 by rtushnet
Brighton Collectible, LLC v. Believe Production, Inc., 2017
WL 440255, No. 15-cv-00579 (C.D. Cal. Jan. 30, 2017)
Brighton sued Believe for infringing Brighton’s copyright in
a jewelry design and also engaging in false designation of origin/unfair
competition.  In particular, Brighton
alleged that Believe used photos of Brighton’s jewelry into the promotional
materials for Believe’s lower-quality jewelry. 
One Brighton collection includes a heart within a heart design, the Reno
Heart.

Reno hearts from Brighton

Believe publishes product catalogues used in student
fundraisers.  Brighton alleged that the
infringing products were substantially similar to the Reno Heart earrings and
bracelet, but lower quality and priced lower. Believe sold 5,414 of the
bracelets (at $19.50) and 3,849 sets of the earrings (at $14), less than half
the price of Brighton’s analogous items.
 

Believe promo image from opinion
Promo image, Brighton heart, Believe heart side by side
Defendant sought to exclude the testimony of Robert
Wunderlich and Margaret Campbell regarding damages. Wunderlich was a principal
at Discovery Economics, a professional services firm that consults on economic,
financial, and accounting issues. 
Wunderlich estimated Brighton’s lost profits, including his calculation
that customers who purchased an item of jewelry from a Brighton retail outlet
also bought an additional 1.27 other items, on average.  Campbell would opine regarding “the
anticipated effects of knockoffs or imitation products on an authentic brand,” including
on likely confusion and on lower willingness to pay for Brighton products.
The court allowed Wunderlich’s testimony, which indicated a
decline in Reno Heart sales relative to Brighton’s other lines, even though
Wunderlich failed to account for all the possible other sources of lost sales.
He didn’t ignore something so central to the case as to make his opinion
inadmissible.  Also, the court allowed
him to testify about the 1.27 multiplier, which the jury might accept if it
made its own findings about how many sales Brighton lost.
The court also allowed Campbell’s opinions about the damages
she expected to follow from Believe’s alleged use of Brighton’s jewelry to sell
lower-quality products and the relative prices of Believe and Brighton’s
jewelry: lost sales and brand “dilution.” “Courts regularly permit marketing
experts to testify to the role of branding, distinctiveness, and design in
consumer behavior as well as what effects they would expect based upon the
facts of any particular case.”  Here, Campbell’s
opinion was sufficiently grounded in the evidence. Failure to conduct a
consumer survey didn’t undermine the reliability of her opinion.  (The court doesn’t explicitly discuss her
opinion on the likelihood of confusion. 
If the court is really allowing expert opinion on likely confusion to
substitute for a consumer survey, that’s an outlier.)
The court also found sufficient evidence of lost sales to
allow Brighton to proceed on its claim for actual damages.  Where a party’s marketing is misleading, there
may be “no need to require appellant to provide consumer surveys or reaction
tests in order to prove entitlement to damages.”  To recover lost profits, “a plaintiff must
make a ‘prima facie showing of reasonably forecast profits.’ ” Here,
There is evidence suggesting that
Believe disseminated nearly 700,000 sales catalogues nationwide wherein Believe
used photographs of Brighton products to sell similar, lower-quality jewelry
for less than half the cost of Brighton’s analogous Reno Heart products. After
Believe sold over 9,000 bracelets and earrings using photographs of Believe’s
copyrighted design, Reno Heart Collection sales declined at a higher rate than
Brighton’s other jewelry sales.
That was enough to create a material issue of fact. Plus,
Believe’s allegedly infringing sales provided an upper range for an award of
damages.
Believe argued that the unfair competition claim was
preempted by the Copyright Act.  Reverse
passing off—allegations that Believe sold Brighton jewelry as its own—would be
preempted.  But this allegation was that
“Believe’s sales of lower-quality, but confusingly similar products using
pictures of Brighton products gave them an unfair advantage in the marketplace
and constituted unfair competition.” That was regular palming off, and not
preempted.  (Under Dastar, does the allegation relate to the origin of the physical
objects, or the origin of the creative spark behind the objects?  Does the answer depend on whether consumers consider the bracelet they receive to be “the same” as the bracelet in the photo?)

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use of P’s jewelry in D’s ad is regular passing off, not reverse passing off

Posted on February 6, 2017 by rtushnet
Brighton Collectible, LLC v. Believe Production, Inc., 2017
WL 440255, No. 15-cv-00579 (C.D. Cal. Jan. 30, 2017)
Brighton sued Believe for infringing Brighton’s copyright in
a jewelry design and also engaging in false designation of origin/unfair
competition.  In particular, Brighton
alleged that Believe used photos of Brighton’s jewelry into the promotional
materials for Believe’s lower-quality jewelry. 
One Brighton collection includes a heart within a heart design, the Reno
Heart.

Reno hearts from Brighton

Believe publishes product catalogues used in student
fundraisers.  Brighton alleged that the
infringing products were substantially similar to the Reno Heart earrings and
bracelet, but lower quality and priced lower. Believe sold 5,414 of the
bracelets (at $19.50) and 3,849 sets of the earrings (at $14), less than half
the price of Brighton’s analogous items.
 

Believe promo image from opinion
Promo image, Brighton heart, Believe heart side by side
Defendant sought to exclude the testimony of Robert
Wunderlich and Margaret Campbell regarding damages. Wunderlich was a principal
at Discovery Economics, a professional services firm that consults on economic,
financial, and accounting issues. 
Wunderlich estimated Brighton’s lost profits, including his calculation
that customers who purchased an item of jewelry from a Brighton retail outlet
also bought an additional 1.27 other items, on average.  Campbell would opine regarding “the
anticipated effects of knockoffs or imitation products on an authentic brand,” including
on likely confusion and on lower willingness to pay for Brighton products.
The court allowed Wunderlich’s testimony, which indicated a
decline in Reno Heart sales relative to Brighton’s other lines, even though
Wunderlich failed to account for all the possible other sources of lost sales.
He didn’t ignore something so central to the case as to make his opinion
inadmissible.  Also, the court allowed
him to testify about the 1.27 multiplier, which the jury might accept if it
made its own findings about how many sales Brighton lost.
The court also allowed Campbell’s opinions about the damages
she expected to follow from Believe’s alleged use of Brighton’s jewelry to sell
lower-quality products and the relative prices of Believe and Brighton’s
jewelry: lost sales and brand “dilution.” “Courts regularly permit marketing
experts to testify to the role of branding, distinctiveness, and design in
consumer behavior as well as what effects they would expect based upon the
facts of any particular case.”  Here, Campbell’s
opinion was sufficiently grounded in the evidence. Failure to conduct a
consumer survey didn’t undermine the reliability of her opinion.  (The court doesn’t explicitly discuss her
opinion on the likelihood of confusion. 
If the court is really allowing expert opinion on likely confusion to
substitute for a consumer survey, that’s an outlier.)
The court also found sufficient evidence of lost sales to
allow Brighton to proceed on its claim for actual damages.  Where a party’s marketing is misleading, there
may be “no need to require appellant to provide consumer surveys or reaction
tests in order to prove entitlement to damages.”  To recover lost profits, “a plaintiff must
make a ‘prima facie showing of reasonably forecast profits.’ ” Here,
There is evidence suggesting that
Believe disseminated nearly 700,000 sales catalogues nationwide wherein Believe
used photographs of Brighton products to sell similar, lower-quality jewelry
for less than half the cost of Brighton’s analogous Reno Heart products. After
Believe sold over 9,000 bracelets and earrings using photographs of Believe’s
copyrighted design, Reno Heart Collection sales declined at a higher rate than
Brighton’s other jewelry sales.
That was enough to create a material issue of fact. Plus,
Believe’s allegedly infringing sales provided an upper range for an award of
damages.
Believe argued that the unfair competition claim was
preempted by the Copyright Act.  Reverse
passing off—allegations that Believe sold Brighton jewelry as its own—would be
preempted.  But this allegation was that
“Believe’s sales of lower-quality, but confusingly similar products using
pictures of Brighton products gave them an unfair advantage in the marketplace
and constituted unfair competition.” That was regular palming off, and not
preempted.  (Under Dastar, does the allegation relate to the origin of the physical
objects, or the origin of the creative spark behind the objects?  Does the answer depend on whether consumers consider the bracelet they receive to be “the same” as the bracelet in the photo?)

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Transformative work of the day, why would you even want that edition

Posted on February 6, 2017 by rtushnet
Among the notable things in this
story about ridiculously expensive houses, consider the description of a prior house with “a
master bedroom modeled after a Louis Vuitton store,” and “a chain saw featuring
Rolls-Royce hood ornaments, a giant Louis Vuitton syringe, and a huge Birkin
bag and stack of Louis Vuitton luggage all carved from honey onyx. Most of
those pieces were designed for the house.” 
Infringing?  Interesting that for
all LV’s litigiousness, these artworks seem to have gone unchallenged.
I couldn’t find a good image of the bedroom but note the … glass case of fire extinguishers?

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Blast from the past: claims to comply with vague industry standard weren’t literally false

Posted on February 3, 2017 by rtushnet
Lamons Gasket Co. v. Flexitallic L.P., No. H–14–0247, 2015
WL 12831719 (S.D. Tex. May 13, 2015)
The parties competed in the market for spiral wound gaskets
and other products used in the oil and gas industry to join and secure pipes. “A
spiral wound gasket consists of a piece of material wound tightly in a circular
form contained by a solid metal outer ring.” 
The American Society of Mechanical Engineers (ASME) issued relevant
industry standards, providing a specified range for the Outer Diameter (OD) of
a “4–inch” gasket. The ASME
standard did not, however, specify the method for measuring the OD and specifically didn’t provide whether the loose end, or “tail,” of the winding material should be
included in the measurement.
Flexitallic told customers that the outer diameter of Lamons’s
spiral wound gaskets failed to comply with the ASME standard.  Lamons alleged that this was false, because
Lamons’s spiral wound gaskets complied with the ASME standard if measured using
Lamons’s methodology.  Flexitallic alleged
that, in retaliation for Flexitallic’s statements about Lamons’s gaskets,
Lamons advertised that two Flexitallic spiral wound gaskets, depicted in a
photograph, failed to comply with the standard, and that Flexitallic had adopted
or endorsed Lamons’s methodology for measuring the OD of spiral wound gaskets.  Lamons sued for false advertising and
business disparagement, and Flexitallic counterclaimed for the same things.
Flexitallic had no evidence of actual deception, and thus had
to show literal falsity.  Lamons’s method
for measuring OD involved measurement with the gasket in a compressed state,
and included the tail in the measurement.  Flexitallic didn’t show that, measured using
this method, the gaskets didn’t comply with the ASME standard.  Flexitallic did show that if the OD was
measured using Flexitallic’s method or some variation of the Lamons method, the
OD was too small.  However, the ASME
standard didn’t address how the OD was to be measured. Indeed, after the Lamons
ad was distributed, the ASME Committee for Gaskets and Flanged Joints [I love the whole world and all its mysteries] discussed
the definition of “gasket outer diameter” and decided that “an inquiry [would]
be submitted in order to better clarify the definition.”  Dow Chemical Company also opined that the OD
standard was “vague” and subject to “open interpretation.”  Flexitallic’s evidence indicated that many—perhaps
most—companies in the industry measured the OD in a manner more similar to
Flexitallic’s method.  But that didn’t
show that Lamons’s method was impermissible under the ASME standard.  Thus, the claim was at most misleading and,
without evidence of actual deception, summary judgment for Lamons on the Lanham
Act counterclaim was proper.

However, there was a genuine issue of material fact on the Lanham
Act and disparagement claims based on Lamons’s statements that two Flexitallic
spiral wound gaskets did not comply with the ASME standard, and that
Flexitallic had adopted or endorsed Lamons’s measuring methodology.  First, there was evidence that one of the
gaskets wasn’t Flexitallic’s, which meant literal falsity.  Also, there was evidence of literal falsity
in that Flexitallic steadfastly maintained that Lamons’s measuring method was
improper.

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Advertising a phone with an unauthorized screenshot of an app doesn’t violate the Lanham Act under Dastar

Posted on February 3, 2017 by rtushnet
Appjigger GmbH v. BLU Products, Inc., 2016 WL 4119720, No.
15–22313 (S.D. Fla. Mar. 7, 2016)
Appjigger makes apps, and has an exclusive license for the WP
CLOCK software app, which is available both to end users and also for licensing
and pre-purchase installation by retailers. 
BLU Products’ mobile device allegedly came pre-equipped with the WP
CLOCK. BLU Products also allegedly advertised its mobile devices “with screens
which are substantially indistinguishable from the screenshots of android smart
phones using Plaintiffs’ WP CLOCK.”
This motion to dismiss didn’t challenge the copyright claim,
but dealt with unjust enrichment/unfair competition/false advertising.  Appjigger argued that “[t]he
misrepresentation of fact made by Defendants is that they are the origin of the
software that is prominently displayed in their advertising,” but they weren’t.  However, passing off under Dastar requires the producer to
misrepresent his own goods or services as someone else’s.  There was no suggestion that BLU was passing
off its mobile devices as Appjigger’s; Appjigger doesn’t make mobile devices.  Appjigger alleged that it created “some of
the software, ideas, or concepts embodied in Defendants’ devices,” but not the
devices themselves. 
Appjigger argued that it was the “origin” of the software
while BLU was the origin of the devices, but the court did not accept that “a
single tangible good protected by the Lanham Act may have multiple origins,”
given Dastar’s focus on the producer
of the tangible good.  [Query: would
allegations of false endorsement have mattered? Here, I find it rather
implausible that consumers would think that app makers endorse any device on
which their apps may be found.]  Courts
have therefore easily dismissed claims that unlawful sales of copies of a
plaintiff’s works, with the defendant identified as the creator of the physical
objects, violate the Lanham Act.  This case
was Dastar, except with a valid
underlying copyright [as, indeed, the 9th Circuit found to be the
case on remand in Dastar].
The Lanham Act false advertising claim failed because
Appjigger didn’t identify any misrepresentation about the “nature,
characteristics, qualities, or geographic origin” of BLU’s phones.  Authorship isn’t a “nature, characteristic, or
quality” under the Lanham Act, to avoid pleading around Dastar. “A defendant does not violate the Lanham Act’s false
advertising provisions by promoting its product while failing to properly
attribute the source of the underlying technology embodied in the product.”  Nor could the allegations be re-interpreted as
a trade dress claim, because plaintiffs didn’t plead anything about non-functionality
or distinctiveness.
The coordinate state and common law claims for unjust
enrichment and violation of Florida’s Deceptive & Unfair Trade Practices Act
were preempted.  Appjigger argued that
the necessary extra element to avoid preemption was supplied by “the
advertising and promotion of Defendants’ mobile phones showing the unauthorized
image of the Appjigger WP Clock software home screen.” But “showing the
unauthorized image” was nothing other than an “act[ ] of reproduction,
performance, distribution or display.” Nor was intent to profit an extra
element.
Query: If the copies of the app actually on the BLU phones, assuming such copies were there, were properly purchased, can the use in ads be anything other than fair use?

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Blast from the past: false price claims insufficiently pled

Posted on February 2, 2017 by rtushnet
Ashley Furniture Indus., Inc. v. American Signature, Inc., 2015
WL 12999664, No. 11-cv-427 (S.D. Ohio Mar. 12, 2015)
At this point I will just institute a “blast from the past”
category for Westclip.  This one made it
because of a discussion of Twiqbal
plausibility for false advertising claims based on allegedly false pricing.  Main
issue, focused on fair use in comparative advertising, discussed here.  As relevant here, defendant (aka Value City) counterclaimed
against its sofa-selling competitor, Ashley, under the Lanham Act and
coordinate Ohio state law.
Value City provided seven examples of purportedly false ads
involving items of furniture offered at a “sale” price along with one or more
higher prices for comparison. In several, the item of furniture was advertised
several months later with different “regular” and “compare” prices. In
addition, Ashley’s ads included “one day” sales and “limited quantity” sales,
but the items in those sales were offered on multiple occasions. Several ads
also said that the items were discounted by a specific amount or percentage,
but the ads didn’t identify the nature of the higher price, such as whether the
higher price was Ashley’s regular price or a competitor’s price. Value City
alleged, “upon information and belief,” that the “sale” prices in the
advertisements were in reality Ashley’s regular prices, and the “regular”
prices were artificially inflated prices used just for ads.
The court found that Value City had failed to plead plausible
false advertising claims.  Value City
argued that it was reasonable to infer that serial offers of the same “one day”
deal were false; that comparative prices that “yo-yo up and down” were not
actual prices from a competitor; and that a “compare” price “that suddenly
zooms up by $800” wasn’t based on bona fide sales of a comparable item at a
competing retailer.  The court disagreed.
The allegations gave rise to an inference that false advertising was possible,
but not plausible. 
Value City’s core argument was that the ad prices changed
over time, but there were a lot of possible explanations for that not involving
false advertising:  “Businesses routinely
adjust the prices of their products. The same is true of the allegedly
successive one-day and limited quantity sales. Supplies might be limited at one
point in time but not at a later date.” 
As for failure to identify the source of the comparison price, that made
the ads ambiguous, as was the meaning of “one-day” and “limited quantity”—did that
mean forever, or just for now?  Thus,
these weren’t plausibly literal falsehoods.
One alleged misrepresentation could constitute literal
falsity: the statement that Ashley’s advertised prices were sales prices when
in fact they were its regular prices. Further, allegations based upon
“information and belief” don’t necessarily fail Twiqbal. However, here, Value City’s “bald assertion” was “conclusory
and speculative,” lacking additional factual allegations to provide
plausibility—even if evidence that might support the allegations was uniquely
in Ashley’s possession.
Also, Value City didn’t plausibly plead materiality or harm
causation in connection with the non-literally false statements at issue.

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