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Litigation Planning for Licensing Attorneys CLE Presentation
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Litigation Planning for Licensing Attorneys CLE Presentation

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  • 1. Litigation Planning for Licensing Attorneys Michael G. Atkins Graham & Dunn PC December 15, 2008
  • 2. Naked Licensing of Trademarks
  • 3. Definition of naked licensing
    • Approving use of one’s trademark without exercising control over the quality of the goods or services provided under the mark
  • 4. Trademark principles
    • A trademark:
      • Symbolizes goodwill
      • Assures consistency of quality
      • Encourages brand loyalty
      • Avoids consumer confusion
    • Licensor must control quality of goods/services sold under licensed mark to maintain these principles
      • Naked licensing is “inherently deceptive”
  • 5. Example of naked licensing
    • “Give me some loot and use the name.”
    • TTAB found petitioner engaged in “inadequately controlled licensing” of PIED PIPERS mark
    • Owner Clark Yocum abandoned rights in mark
    • Yocum v. Covington , 216 U.S.P.Q. 210 (TTAB 1982)
  • 6. Abandonment of trademark rights
    • Failure to exercise quality control may cause licensed mark to stop functioning as trademark
    • Owner is estopped from asserting rights in trademark
    • Mark is deemed abandoned without owner’s subjective intent to do so
  • 7. Insufficient quality control
    • Licensor informally tasted wine connected with licensed mark
      • Determined wine was “good”
    • Licensor relied on licensee’s reputation as a world-famous winemaker
    • Held: Abandonment found; S/J against licensor affirmed
    • Barcamerica v. Tyfield ,
    • 289 F.3d 589 (9 th Cir. 2002)
  • 8. What control is sufficient?
    • Quality better than or equal to existing goods/services offered by licensor
      • Define how quality is judged
        • Objective or subjective measures
      • Define inspection process/representative samples
        • Right to review customer comments
    • Circumstances dictate level of control
  • 9. Right to control quality is inherent
    • Right to control quality stems from trademark law, not license agreement
    • Contractual silence does not amount to naked licensing
      • Exercise of control is what’s important
    • Licensor can block unwanted sublicenses even if sublicenses are permitted
    • Miller v. Glenn Miller ,
    • 454 F.3d 975 (9 th Cir. 2006)
  • 10. Recent case law
    • Halo Management v. Interland , 2004 WL 1781013 (N.D. Calif.)
    • License agreement required licensee to:
      • “ Employ reasonable commercial efforts to maintain positive business value of HALO mark”
      • To limit mark use to that as shown in pending applications
      • To mitigate confusion or likelihood of confusion
    • Held: Defendants’ S/J motion to dismiss owner’s infringement claim granted
  • 11. Recent case law
    • Bach v. Forever Living Prods. , 473 F.Supp.2d 1110 (W.D. Wash. 2007) (Pechman, J.)
    • No express quality control provision
      • Trademark owner reserved “moral rights” in copyrighted work that served as trademark
      • Owner would “establish and protect validity of rights” if attacked by third parties
      • In separate agreement, owner reserved right to veto change in movie title and to approve score to movie
    • Held: Defendants’ S/J motion to dismiss owner’s infringement claim denied
  • 12. Recent case law
    • Experience Hendrix v. Electric Hendrix , 2008 WL 3243896 (W.D. Wash.) (Zilly, J.)
    • Quality control procedures, including inspection of prospective licensee prototypes to ensure mark properly displayed and that Jimi Hendrix not placed in a bad light, deemed sufficient
    • Held: Owner’s S/J motion to dismiss naked licensing counterclaim granted
  • 13. Questions?
    • Michael Atkins
    • Graham & Dunn PC
    • (206) 340-9614
    • [email_address]