JOLT Digest

By Michael Hoven

Zediva Closes Permanently, Pays $1.8 Million in Settlement

The streaming movie service Zediva has agreed to shut down permanently and pay $1.8 million to settle its lawsuit with Hollywood studios, Wired reports. (The MPAA is hosting the consent decree from the Central District Court of California.) The studios sued Zediva in April, one month after it launched its service. Zediva let users watch movies online by remotely renting and operating DVDs and DVD players owned and stored by Zediva. Zediva argued that because it rented DVDs to only one customer at a time, it operated like a video rental store and did not need to have licensing agreements with studios. As JOLT Digest previously reported, this argument did not stop the district court from issuing a preliminary injunction against Zediva in August. PCMag.com reports that the MPAA applauded the “strong message” Zediva’s shutdown sent to potential infringers and considered the shutdown a victory for the film industry.

Power Rangers Halloween Costumes Lead to Lawsuit

Owners of the intellectual property rights associated with the Power Rangers television series have sued the operators of a website for selling the Power Rangers’ colorful uniforms as Halloween costumes, according to The Hollywood Reporter. SBC Power Rangers LLC alleges that the costumes sold at MyPartyShirt.com (operated by Underdog Endeavors) infringe its copyrights and trademarks. Though clothing is not eligible for copyright because of its utilitarian function, “individual design elements” may be copyrightable. The Celebrity Justice blog at Findlaw says that while the patterns on the Power Rangers costumes could be protected by copyright, the stronger claim is that MyPartyShirt.com violated a trademark by using the Power Rangers name on its site.

U.S. Marshals to Seize Righthaven’s Assets to Pay Legal Fees

The District Court of Nevada ordered U.S. Marshals to seize $63,720 that Righthaven owes in legal fees as a result of its ill-fated lawsuit against blogger Wayne Hoehn, reports paidContent. The court dismissed Righthaven’s copyright suit against Hoehn this summer and awarded legal fees to Hoehn. Righthaven claimed that it could not afford to pay the roughly $30,000 award; the size of the award has since doubled as Hoehn’s lawyers have worked to enforce the judgment. While Righthaven’s legal strategy—the lawsuit against Hoehn was one of nearly 300 similar suits—garnered it some favorable settlements, it has not succeeded in court, as JOLT Digest has reported. Righthaven owes a variety of defendants over $200,000 in legal fees, according to Poynter, and may end up in bankruptcy.

District Court Permits Facebook’s Trademark Suit to Proceed Against Teachbook.com
By Albert Wang – Edited by Abby Lauer

Facebook, Inc. v. Teachbook.com LLC, No. 11-cv-3052 (N.D. Ill. September 26, 2011)
Slip Opinion

The District Court for the Northern District of Illinois denied defendant Teachbook’s motion to dismiss a trademark infringement suit brought by social networking site Facebook.

Judge Aspen, writing for the court, held that Facebook had pled sufficient facts to survive Teachbook’s Rule 12(b)(6) motion. The court declined to consider Teachbook’s extrinsic evidence and based its holding solely on the content of Facebook’s complaint and exhibits. The court also rejected Teachbook’s assertion that the word “book” was too generic to sustain a trademark claim, noting that Facebook’s trademark registration covers the compound word “Facebook” and that the specific use of “book” as a suffix was potentially protectable. In so holding, the court noted that consumer confusion could arise because Teachbook framed its service as an alternative for teachers barred by work policy from using Facebook.

The Trademark and Copyright Law Blog provides an overview of the case. John Del Vecchio contemplates the consequences of this holding for other sites with the word “book” in their name, while Eric Goldman criticizes the court’s findings on generic terms and on the likelihood of consumer confusion.

(more…)

By Andrew Segna

Google Acquires Motorola Mobility for $12.5 Billion

Google announced on August 15, 2011 that it will acquire Motorola Mobility for $12.5 billion in cash. Ars Technica reports that this purchase was motivated in part by Google’s desire to acquire Motorola’s patents and to protect its Android mobile platform, as this deal will give Google control of more than 17,000 patents in the mobile arena and 7,000 patent applications. This acquisition comes in light of Google accusing Microsoft, Apple, Oracle, and other companies of attacking Google and Android by acquiring Novell and Nortel patents.

Missouri Federal Court Reject LegalZoom’s Motion for Summary Judgment on Whether LegalZoom Violates Unauthorized Practice Law

As reported on Eric Goldman’s Technology and Marketing Law Blog, the District Court for the Western District of Missouri rejected LegalZoom’s motion for summary judgment against accusations that the website dealt in the unauthorized practice of law. LegalZoom offers both blank legal forms and a service in which customers answer a series of questions, which provides LegalZoom’s software with the information necessary to create a completed legal document for the customer. The court did not have an issue with the blank forms. However, the court found that there was a question of whether LegalZoom, through the questionnaire, did more than just allow a customer to pick various wordings of a document.

Activists Protest Bay Area Rapid Transit’s Decision to Cut Mobile Phone Access in Subway Stations

According to the Guardian, a protest occurred in the Civic Center subway station in San Francisco on the night of August 15, 2011 over the decision by Bay Area Rapid Transit (BART) to cut mobile phone access on August 5 in anticipation of a protest against police shootings that threatened to disrupt rush hour commute. Anonymous, the online activist group, broke into BART websites and organized the August 15 protest. BART did not cut off mobile access on August 15 but did temporarily shut down the Civic Center station and three other stations.

Minecraft Developer Vows to Oppose Trademark Infringement Suit

Markus “Notch” Persson, the creator of the popular PC game Minecraft, asserted that he would oppose video game publisher Besthesda Softworks’ claim of trademark infringement, as reported by Ars Technica. Besthesda claims that the title of Persson’s new game, Scrolls, infringes its trademark on its own video games series, The Elder Scrolls. Persson initially responded to the allegations, which he called “bogus,” by challenging Bethesda to a match of the video game Quake III to determine who was right.

Apple’s Trademark Claim to the Term “App Store” Fails on Preliminary Injunction Motion
By Samantha Kuhn – Edited by Abby Lauer

Apple, Inc. v. Amazon.com Inc., No. C 11–1327 PJH, 2011 WL 2638191 (N.D. Cal. July 6, 2011)
Slip Opinion hosted by Scribd.com

On July 6, the District Court for the Northern District of California denied Apple’s motion for a preliminary injunction to enjoin Amazon.com from using the term “App Store.” The court found that Apple’s claims of trademark infringement and dilution were unlikely to succeed on the merits.

In her decision, Judge Phyllis Hamilton held that Apple failed to show that it was likely to prevail on its trademark infringement claim, based on the weakness of its argument regarding the “likelihood of confusion” element. With regard to the dilution claim, Judge Hamilton was not convinced by Apple’s contentions that the “App Store” mark is distinctive and that it can be diluted by blurring and/or tarnishment. The main issue in this case seemed to be whether the mark “App Store” should be classified as distinctive or descriptive, as the court rejected the idea that the mark is purely generic.

Ars Technica provides background and a brief summary of the dispute. An additional brief summary is available at News Daily. Eric Goldman hones in on particular aspects of the opinion and criticizes the case for the ridiculousness of the claims and the court’s inadequate treatment of the issues.  (more…)

Ninth Circuit Vacates Injunction in Keyword Advertising Case
By Kaethin Prizer – Edited by Kassity Liu

Network Automation, Inc. v. Advanced Systems Concepts, Inc., No. 10-55840 (9th Cir. Mar. 8, 2011)
Slip Opinion

The Ninth Circuit vacated the preliminary injunction granted by the district court to Advance Systems Concepts (“Systems”) in a trademark infringement case involving the use of keyword advertising.

The court found that the lower court erred in its analysis of whether Network Automation’s keyword advertising, which targeted the name of its competitor Systems’ software, created a likelihood of consumer confusion. The district court had prioritized the “Internet troika” factors that were emphasized by this court in Brookfield Commc’ns, Inc. v. West Coast Entm’t Corp., 174 F.3d 1036, 1054 (9th Cir. 1999). The circuit court disagreed with this approach, holding that the “troika” factors should not be the controlling factors for all cases of trademark infringement that involve the internet, and added that the “troika” factors may only be appropriate for domain name disputes. In so holding, the court emphasized that “[w]e must be acutely aware of excessive rigidity in applying the law in the Internet context; emerging technologies require a flexible approach.”

IP Law Chat gives an overview of the case. Public Citizen and Eric Goldman provide thorough analyses of the decision. (more…)