Notre Dame Roundtable on Scope, part 5

Abraham Drassinower, Publish and Perish: Remarks on Copyright Duration

Commentators: Barton Beebe and Chris Buccafusco

Beebe: for non-WFH, term is calibrated to lifespan of author.  Why so reliant on the death of the author to measure protection?  Not so interested in the historically contingent elements; more analytical.  Not interested in duration as such, +50, +70, etc.  Not interested in corporate works or even relatively functional works like computer code, or other works of low subjectivity like technical manuals. The ideal © work in this mediation is a novel or critical essay. How would this sensibility, which isn’t concerned w/history, work w/TM law?

Why death? B/c of independent creation as a requirement/doctrine, which sets it off from TM and patent. Result is a play of identity and difference. There is a single text, but two separate authors might have authored it separately.  The two texts would then be treated as different works as a legal matter.  © is indifferent to the objectivity of the work—a communicative act. Two different authors can produce two different communicative acts even if they produce exactly the same text. Author’s status is not transferable. It can’t be suddenly their death that measures the term.  [Two deaths of the author: also a description of WFH, no?]

Millar v. Taylor: personal link b/t author and work allows disclosure w/o abandonment, but that also entails limited duration as right. Author’s authority as speaker can’t survive her own death.

Responses: why doesn’t the argument actually support perpetual ©?  Authority could survive death, couldn’t it?  Gorgeous, uncommodified version of © as communicative acts, not expression on the marketplace. Is this a narrow slice of daily life of © in market/different from standard case of commodified object?

Death of the author: used to support the myth of independent creation, which the paper takes for granted. Duration based on death indicates that the author is the source, not the society etc.

Buccafusco: as a thoroughgoing welfarist, skeptical of logical analysis of legal scheme. If we have a theory of what © is, what should it do/is it likely to do w/r/t more peripheral doctrines? From independent creation we can learn something about duration. But which way does the causal arrow run? Does duration really tell us what the central point of © is?

If certain durations must follow from certain goals of ©, you have to really hammer that home. Counterargument: © has never been linked to the death of the author. Ending at death isn’t the same thing as ending if death—if you register then die, you’d get the full term.  Beginning to apply a fixed term once death occurs is different, and so we need to know how to think about this post-death fixed term. The author’s authority survives, for a rather long time.  Draws on distinction b/t patent and © but never tells us what’s importantly different about what inventors do and why their relationship to their creations is different.

Scope: that I have spoken doesn’t mean you can speak for me, Drassinower says, but that’s except for all the times I can—not substantially similar, under license, fair use, when I inaccurately attribute to you. So what kinds of speech are appropriately the author’s and what are not (this is likely to be in the book but not the chapter).

Drassinower: Tied to the person of the author—the proposition that the work is an act. Independent creation is unthinkable if we think of the work as a thing b/c an independently created work would be the same thing/a trespass. It has to be an origin issue, about acts. Once you think of works as acts, then copies aren’t “things” out there, but rather megaphones through which the author thinks. When the author dies, they’re no longer personifications of the author and their status dies with the author. Link is severed by biological death, and work is now in public domain [after 70 years have passed].  Not applying a theory of anything, just trying to understand why death is in the statute. Either we account for why death is in the statute or we say it shouldn’t be, but our theory of © should account for it, especially given the foundational issue in Millar v. Taylor which is whether there was to be a public domain/limited duration at all.

Fromer: people prefer life plus to fixed term—optimism bias or something else? One thing w/Canadian lens is that you don’t have America’s problem of WFH.  This is a big problem for an Americanist trying to make the same claim as you are—who is authorship given to? You need a new formula once an entity is the author.  Also interesting to frame it as being about death than about life.  What if you framed it another way?  © doesn’t stop at death, sure, but one thing you can say for sure is that © goes through life.

Drassinower: yes, he thinks we misunderstand the relationship b/t author and copyright by having it extend so far past death. 

Yelderman: Authors can lose their rights to speak by transferring ©. Shouldn’t your theory not just give the author a defense but even cause the © transfer to be forfeit?

Said: death of the author/the reader matters at least as much/more. The concept is about creating additional dignitary interests in readers, but you are using it for the author.

Drassinower: we should think of the work as a connection b/t author and audience—it is the site of a relationship, juridically speaking. If that’s what the work is, then one pole’s disappearance makes the whole thing disappear.

Said: if you double down on that characterization, it feels fundamentally incompatible with a property interest at all.  She sees a tertium quid, a space w/a reader’s interest (also a property interest?).

Drassinower: the analogy is not property or patent bargain, but defamation: link w/reputation.  After death as well as in life.  Interested in looking at the text to tell us what differentiates copyright from other regimes: independent creation.  Otherwise: We’d have to understand which parts are historical accidents and which aren’t, which is difficult to do. He’s not sure independent creation is a myth: not about divine creation.  If there’s no independent creation, then © makes no sense as a whole.

McKenna: your method is to try to ID foundational tenets and extract them, then reason about what would make the system work. A lot rides on identifying the critical features. Why not say: a central feature of © is that it lasts 50 years after death?  The fact that it doesn’t expire on death has historically been a feature of every © system and so why don’t you extract that. 

Buccafusco: independent creation is required for patentability (though not infringement). You have to not-copy in an especially clever way, which should produce a strong relationship b/t inventor and creation.

Fromer: in patent what predominates is the length of the duration. You might want to say that inventors also have some sort of connection, but there is a strong interest in keeping the duration much shorter, so lifespan of creator will be problematic.

Drassinower: defense of independent creation in ©, absent in patent, is important.

McKenna: novelty is not about whether you copied it, but whether you made the same thing as something that existed before.  Copying probably makes the same thing, but copying is not the key.

Buccafusco: you get so much from originality in ©, whereas in patent you have to invent and do so much more to qualify for patent.

Drassinower: I’m not trying to find a theory of why patent isn’t perpetual, but rather trying to figure out why death is in the © Act.

Lemley: is the act of authorship static or dynamic?  No concern after death seems to presuppose that author is not speaking any more, even if audience is still receiving message and still cares about the source.  That suggests authorship is a one-time act. But if so, why does it last beyond the moment of creation itself [or publication]? The only reason for duration at all that is moral is the idea that it is a continuing relationship w/the work.  But if that’s right, how do you get a moral theory for stopping at death?  At death economic incentives cease to work, but what else?

Drassinower: can endure, like a reputation, where the right doesn’t endure beyond your life even if the reputation does.  Rule Against Perpetuities: the owner dies and the right persists, but only so long.

Buccafusco: why isn’t the right analogy privacy? Right of first publication—seems just as plausible as the scheme you posit here. Sure, defamation is a different analogy but why pick it?

Lemley: you seem to view my speaking as a continuing act.  If I say it when I’m 15, then forget about it, if it’s still me speaking during my life why doesn’t it continue after my death?

Drassinower: you can no longer authorize or reject speech after you die.

Lemley: what if you’ve assigned the right to authorize?  Couldn’t I contract it to survive my life?

Drassinower: you don’t own it after your life.

Said: does it matter if copyright contributes to works being lost/suppressed, impeding the author’s communicative function for books out of print?  You’ve privileged one thing (authorization) in a way that hurts the author’s interest. That suggests that people’s works who don’t ever fall out of circulation should get better or different treatment, introducing hierarchy of interests. The interests in communication don’t feel static; if you cast them as static for a theoretical/normative purpose, you have to overcome the empirics/theories that would privilege the readers, or privilege other values such as efficiency.

Drassinower: there could be a distance b/t what is happening and what © doctrine is saying. I’m trying to understand how © is operating.  Seems to him that © says that authorship generates a certain kind of right that lasts at least until death.

Lemley: you’re saying I’m still speaking when it’s reused—it’s a new act of speech by me.  But that’s somehow not true after death.  Compelling me to speak is a fiction—it may be completely clear that it’s a pirate copy.

Drassinower: b/c you can neither authorize nor not authorize after you’re dead. Work is ongoing act; each copy is not a commodity but a representation of the author as speaker. I don’t think you can make sense of independent creation and fair use without this concept.

Notre Dame Scope Roundtable, part 4

Chris Buccafusco & Mark Lemley, Screening Functionality

Commentators: Abraham Drassinower and Jim Gibson

Gibson: regime shopping is even more troublesome than scope problems in one regime. Design patents seem to exist purely for regime shopping; everyone wants a patent right w/o having to go to the PTO.

Didn’t find the notion of a percentage continuum of functionality all that helpful b/c the limiting doctrines/screens discussed very infrequently depend on the percentage of functionality in a given work—maybe merger does. They tend to boil down to some kind of separability (e.g., Altai’s nugget).  Not tonnage but ease of extracting one from the other, except for design patent which has jettisoned any requirement. Some are more bright line than others; Google v. Oracle says all consideration of what’s separable is shunted into fair use which is at least chronologically clear.  The filter being used is often a function of the kind of work the author creates: software, product configuration, PGS work. But it’s also a function of where the court sets the boundaries of the work; that performs a separability/filtering function itself—are we starting w/ something purely aesthetic or functional?  Maybe the X axis should represent separability where Y axis represents functionality—they’re related but distinguishable.

Originality as a more important screen after Star Athletic: Breyer suggests that the majority’s test would still produce a defendant-favorable result after originality is applied.  Also merger: one concept of merger is functional constraint on choices. You conceive of merger as something that kicks in at the low end of the aesthetic scale, but maybe it’s the zero/vanishing point on the scale. Originality would also fit in there.

Material that gets filtered out, but comes back in in compilation analysis—look and feel analysis gets sloppy, though there are some real compilations w/new aesthetics when put together.  A lot of screens aren’t just functionality screens, such as idea/expression, which also mediates between past, present, and future authorship.  Even Altai isn’t entirely about functionality—also about originality, public domain. Left w/question: if you’re evaluating screens in pros & cons for functionality, do we lose anything b/c of pros and cons for the other work that these screens do that we should be considering?

Drassinower: differences b/t exclusion and filtering: what’s out altogether, and what’s out even though it originally got in (like a border crossing and you have visa for a particular purpose). They both preserve free competition.  Exclusion as a heightened originality requirement—not copied, and subjecting to filtering ought not be too costly; if it is too costly, we have a heightened originality requirement.  But do you mean to say that originality is formally an independent principle, and if so what’s the relation with functionality?  Other tension worth developing: functionality as market efficiencies.  Administrative efficiency is separate: the likelihood that judges/etc. will make wrong decisions. Elaborate market logic’s relationship to administrative logic that presides over the functionality/protectability determination.

Lemley: A one-D line wouldn’t allow you to draw the distinction we want, which also goes to scope of protection.  X axis is percentage of functionality, Y is scope of protection; in a perfect world we’d have a 45 degree angle, with only the nonfunctional stuff protected. What constrains that? Administrative costs, difficulty of filtering. What do we do given those costs to get the second-best outcome?

Separability, not in the Star Athletica sense, can help us with the easy stuff to figure out the size of the “work.” Copyright does screen on percentages—in certain contexts the game is not worth the candle.  Food, yoga poses.  Leave it out entirely, or leave it out unless it passes a threshold.  Depends on assumptions about how much will be expressive v. how much functional.

Exclusion = what’s out entirely; filtering tells you what you get once you’re in.  It’s rules (exclusion) v. standards (filtering).  [Does that make sense when exclusion is often itself done case by case?]  The reason we have functionality doctrines is channeling in the service of market efficiency, but implementation of functionality screens is not driven by market efficiency; it’s driven by concerns about administrative efficiency.

Buccafusco: we try to avoid defining functionality at all. We are also concerned w/incentives: we don’t seem to be experiencing a shortage of recipe-related creativity, or dam-related creativity, or polka-related creativity—interaction b/t incentive costs and administrative costs helps explain the screen.  [Also error costs, as Lemley points out—even if we didn’t think there was much need for incentives, we wouldn’t be so worried if we thought this would be done in an error-free way; individual errors are costly as McKenna points out.]

Fromer: you’re conflating exclusion and filtering based on actual examples—you tend to talk about exclusions as categorical b/c that’s how we see them, but they don’t necessarily have to be that way. Separate factor affects that: if it’s case by case that affects costs.  Another factor not disaggregated is timing.  Administrative costs: you assumed that filtering would be later than exclusion.  So what costs are just about one or the other?

There is a functionality screen in utility patent: utility. Is there any symmetry going on? Thinking through that might illuminate other areas.

Burstein: Design patents is the most disconnected from the others. But is there really no filtering in design patent? We do it in infringement/claim construction—not in principled or clear way, but even though it’s not done in validity, you get particular appearance and not general concept.  What would a threshold look like?  Would it be enough to disclaim the functional part by putting it in dotted lines?

McKenna: No recipes is one kind of categorical rule.  Traffix is another kind of categorical exclusion, but it’s a determination based on substantive definition of functionality rather than ontological status as recipe. © has a mixture of both. TM law is almost uniformly not ontological.  One way TM tries to mitigate costs: Wal-Mart shifts the curve over, making it have to meet other thresholds for secondary meaning so we don’t have to get to the difficult functionality issues. So think about sequencing w/r/t other doctrines. Is it better to do originality first, or is it so permissive that we are using functionality to avoid hard cases?  [RT but practically, don’t courts and the PTO tend to do both functionality and no secondary meaning, belt and suspenders?]  Court sometimes can’t figure out secondary meaning so does functionality; Louboutin is the opposite, where they do secondary meaning b/c they can’t figure out functionality [and then they neglect infringement analysis; Louboutin is a weird one b/c it finds secondary meaning and then announces there’s no infringement]; no rule of law tells them which to do first.

Lemley: exclusions are the easiest to do before trial so we go there first. Filtration tends to require a jury. As a practicing lawyer/administrative cost sensitive person, instinctively on board with avoiding hard questions when easy questions can resolve the cases.  Gives him some pause is whether doing that case in and case out ends up having selection effects that bias the substantive law.  If all the strong functionality cases are also cases in which there aren’t secondary meaning, we might therefore get a functionality doctrine made up of cases in which functionality argument is pretty weak.  Sequencing as error cost reduction in particular cases might have systemic effects on doctrines/case law.

McKenna: just exclude product configuration altogether, that will solve the problem.

Lemley: one way to insulate decision from reversal is to make a bunch of aligned findings: functionality and no secondary meaning, or secondary meaning and nonfunctionality. That tendency is less in courts of appeals than PTO and district courts.

Beebe: There’s no third category—neither aesthetic nor functional—proposed in the paper. This seems suspicious.  Where do you classify political or religious speech?  Nonfunctional, but therefore aesthetic?  For you, the secondary category is the aesthetic and your real focus is functional and nonfunctional, and you could dispense with any reference to the aesthetic.

Lemley: by aesthetic we might mean “something legitimately subject to an IP regime that isn’t patent.”

Said: if you’re trying to screen, you don’t care where it goes after bouncing off.  If you’re trying to channel, you do care where it goes.

Gibson: but you are trying to avoid people getting back-door patents. So you do care about the double-dipping problem.

Said: but your mechanism to deal with that problem is screening.

Lemley: we aren’t into deciding whether the monkey selfie is copyrightable.  It makes it through the screen as nonfunctional, but we don’t care whether it gets ©.

McKenna: the fact that you have to be clear that it’s not necessary for it to be patentable for it to be screened out by being the kind of thing that could only be covered by patent—Bonito Boats—should affect the design of the screen.

Said: Litman said, 30 years ago © descriptions represented its protection as porous; now many don’t, don’t talk about thin/thick protection.  Worried that this paper may be doing that at the level of the work.  Could a screen ask the question: is this work predominantly composed of protected elements or not?  Not a fan of the more discerning ordinary observer test for works comprised of public domain elements, b/c that’s true of all works, but some lawyers in some jurisdictions have used a filter to think about it that way. Some works you can see at a distance as predominantly composed of copyrightable/uncopyrightable things.

Lemley: even short of exclusion, you’re talking about the Wal-Mart approach from TM. Mostly not about expression (or branding) so create a new & higher threshold outside functionality.

Said: would rather see that than filtering. When you see filtering as a binary option, it’s almost always gotten wrong. Why give it such an important role?  If we have to go all the way to the facts, how is it different in any way from substantial similarity? [It is different in framing, as the Fromer/McKenna paper suggests.  It focuses attention on chunks which may limit the scope granted to the work/design etc.]

Gibson: still wants a definition of functional, especially if the other side is “not functional.”

Samuelson: Vessel Hull Design Protection Act was supposed to be an industrial design law and then it never happened; think about where that would fit in if it changed. If the paper has generality beyond American context: other countries have grappled w/relationship b/t ©, design law, and other forms of unfair competition; functionality plays a role there.  If design patent didn’t have “ornamental” in it, it’d be a straight up industrial design law.  VHDPA prohibits getting both design patent and VHDPA protection—it’s the one prohibition in the law; does raise the question of what the interactions would be like.

Lemley: he thinks VHDPA is really a new form of utility patent, like plant patent. Our view of functionality there should be different b/c the goal is not to prevent people from getting back door utility patents, but rather to give them a new form of utility patent w/fewer requirements.

Notre Dame Scope Roundtable, part 3

Pam Samuelson, Functional Compilations

Commentators: Zahr Said and Steve Yelderman

Said: Framing questions: what is functionality? Does it differ in compilations v. other things?  Is it the same as the useful articles doctrine?  How do owners/litigants determine and assess functionality? Paper provides coherent and cohesive account of caselaw but isn’t in the business of predicting how to do it going forward.  Are there tools we can offer to courts/litigants to do this kind of filtering?  Tort-based questions we might try.

Act of collecting is sometimes asserted as a creative endeavor. Sometimes collecting is expensive.  Cartographic mapping of caselaw that allows us to see patterns.  Taking the cases at face value: you don’t move from formalist to realist modes.  Incentives for creating them are typically economic, practical.  Dictated by function: compilations are dictated by purpose much more than romance (or choices are more constrained in fulfilling the purpose).  Merger ought to have an even higher bar in the compilation side—would need something whimsical or arbitrary, not just exercise of choice.  Exercise of skill and judgment as foundation for ©?  If it’s testable as good or bad—if the person exercising judgment is subject to malpractice for screwing up—that might be a reason to exclude it from ©. Almost estoppel: if you’ve asserted value in market based on truth status (that could be actionable if relied on and false), you shouldn’t be able to claim that the feature is creative. Another question: if elements improve the compilation measurably, then they shouldn’t be protectable.  Look to advertising law for standards re: materiality/measurability.

Steve Yelderman: Taxonomy he perceived was somewhat different from Samuelson’s.  What’s a compilation? Is a ham sandwich a compilation? Seemed to define it in the negative in contradistinction to 8 work categories in 102(a).  Compilations don’t come in until 103.  But then again neither do derivative works, which can be AV works etc.  So why can’t compilation be literary or PGS work? True that plaintiffs often look to compilation as fallback; but usually unprotectable not b/c missed one category but b/c it wasn’t original or was functional.  Often the reason we look at compilation is b/c we already have functionality concerns looming.  One consequence: what’s a compilation is a bit malleable.  Labels?  In many cited cases, courts aren’t explicitly using that language, e.g., instruction manual cases talk about 102(b) and systems, but not so much about compilations.

Distinct limitations, sometimes together and sometimes apart: presence/absence of Feistian originality/creativity.  Is the act of creation the type © intends to incentivize, as opposed to sweat of brow. That’s about origins, backward-looking. Other concern is forward-looking: the need for others to access system/process in work after the fact of creation, often under 102(b)/Baker v. Selden.  That’s what he thinks of as functionality proper.  Recipes have Feistian creativity, but it’s still a list of instructions about how to recreate a dish.

How do concerns about small chunks carry over to the greater whole, or not?  Some border crossings are legit. Feist explicitly contemplates that lack of originality at the level of original elements can be atoned for by the judgment required in compilation. Others not so much—yoga. It’s also possible that individual elements might be creative, but assembled into a system might be unprotectable as a system—this is what Delta Dental missed. The different causes for exclusion might influence how we think about the compilation problem.

Samuelson: interested in how “compilation” served as a backup for other claims. Agrees that compilations can be one of the 8 categories—the Copyright Office says this is required for copyrightability, as w/yoga case.  Drug labels/instruction manuals: they’re on the fringes of compilation, but had enough in common w/other cases to include them.  Also it’s the selection and arrangement of elements that gets attention in infringement analysis, and those are compilation words.  This is the small change of ©, usually invisible, b/c not Disney or Google, but borderline. 

Paper reacts to Oracle v. Google, b/c the software here is functional compilations—Fed. Cir. was wrong. Showing that functionality matters outside of PGS works, contra Easterbrook.

Lemley: what would change if the paper were “functional works” v. “functional compilations”? Real work is showing functionality limits © full stop.

Samuelson: that’s larger project. 

McKenna: calling them compilations highlights the extent to which they’re only marginally protected in the first place.

Said: different notion of authorship, particularly the kinds of compilations we see litigated. Term of art in statute v. artistic process—there’s a tension in those two meanings, and problematizing them is a political intervention to software as a literary work.  There’s a definition of compilation in the statute—gathering and then starting to make creative choices. Literary work: the whole notion that software is literary work is unjustified artifice in copyright’s own terms, that we have to live with going forward. Keep thinking about authorship.

Samuelson: everything about a program is structure, sequence, and organization. Functionality has to limit protection of compilation elements, but it’s invisible once you adopt SSO. 

Buccafusco: much of the work Altai does in filtering out still doesn’t tell us what the protectable “nugget” is. 

McKenna: does © have any theory of what belongs to utility patent?  Samuelson’s paper shows that © has some instincts that aren’t fully articulated.  We could then ask whether it matches up w/patent law’s actual domain as defined by patent law—which he thinks is way broader than what © says is patent law. Courts have instincts about what kinds of functionality count; rejecting certain kinds of arguments, but w/o robust way of talking about.

Lemley: something other than the communicative expression achieving the results: part of the definition of functional?

Beebe: But for the TM paper we began with, papers are unified by struggle to distinguish b/t worlds of subjective and objective. Modernity has been struggling w/that for centuries. Human freedom/objective necessity.  Communication of free subjects—aesthetic in nature.  Functional world: world of necessary, instrumental reason, compilations that don’t express pure freedom.  What Drassinower talks about in © is very different—the utterly free speaker, while Samuelson talks about someone constrained by the objective world. ©’s fate is to address both, especially b/c software consists of language.  If you are committed to preserving human subjectivity through ©, patent law (ironically?) offers limits.

Samuelson: Software IP lawyers say—w/demise of patentable subject matter after Alice, some say © needs to expand. But if it’s too abstract to be protected by a patent, it’s too abstract to be protected by ©. One reason Oracle v. Google is a bad precedent is that it encourages that kind of thinking.

Opinion in my suit against ICE

Tushnet v. U.S. Immig. & Customs Enforcement, No. 1:15-cv-00907 (D.D.C. filed Mar. 31, 2017)

Thanks to my able counsel Michael Kirkpatrick of Public Citizen, initially assisted by Georgetown students from the Institute for Public Representation.  Here, the district court denies ICE’s motion for summary judgment in my FOIA suit, ordering ICE to do further searches/explain why it can’t and to review its redaction of certain elements of industry guides to detecting counterfeits supplied to ICE.

I particularly appreciated the court’s wry summary of how this dispute began, including “Tushnet explained to ICE that an irreverent parody of a recognized trademark does not infringe because it creates no confusion over the item’s provenance.”  A bit more:

As reported in the Boston Globe, ICE spokesman Daniel Modricker announced that any item that “debas[es] a mascot—and really anything that denigrates a team—is guaranteed to be contraband.” Nestor Ramos, U.S. Agents Tackle Fake Super Bowl Items, Boston Globe, Jan. 31, 2015).… After reading the article, Professor Tushnet immediately wrote to Modricker seeking clarification of ICE’s position on parody merchandise. Modricker doubled down in his reply: “if one logo [disparages] another logo than it would be infringement.”

When pressed further on ICE’s legal basis for seizing parody items, Modricker looped in attorney Joseph Liberta, Chief of the agency’s Criminal Law section. … Liberta attempted to assuage Tushnet’s concerns by noting that ICE, in consultation with agency and Department of Justice attorneys, relies on “potential fair use provisions and federal circuit-specific case law” when determining whether probable cause supports a seizure. He invited Tushnet to submit a FOIA request to obtain more information about the number of counterfeit seizures ICE had made in recent history.  Two weeks later, Tushnet took him up on his offer ….

How do ICE agents determine what to seize? The court explained:

As noted above, the only material that ICE produced in response to Tushnet’s request for training or guidance documents given to ICE agents were 25 instructional guides provided to ICE by various sports leagues and sports apparel companies.  Tushnet finds it is “implausible that ICE has no documents of its own” that instruct officers on how to distinguish counterfeit marks.  The Court does not share Tushnet’s skepticism on this score. It seems entirely logical that ICE would rely on apparel licensers and manufacturers to point out the unique features of their branded clothing, rather than to expend the resources necessary to develop those guidelines internally. 

But that fact makes it quite important that such guides be legally accurate, rather than overclaiming trademark owners’ rights.  It also suggests that Mr. Liberta's initial claims to me about relying on fair use and federal circuit-specific case law were, let's say, unfounded, which is really too bad.

I also partially prevailed on my challenge to the adequacy of ICE’s search, given the disparity in search terms used by field offices, some of which didn’t even use the terms I specifically identified in my request, such as “dilution.”

FOIA Exemption 7(E) authorizes agencies to withhold “records or information compiled for law enforcement purposes [that] would disclose techniques and procedures for law enforcement investigations or prosecutions, or would disclose guidelines for law enforcement investigations or prosecutions if such disclosure could reasonably be expected to risk circumvention of the law.”  This creates a relatively low bar for agencies, who must only show logically how releasing information would create a risk of circumvention.  On the basis of this exemption, ICE redacted over 300 of the 521 pages of the industry guides it released.

The court reasoned: “[o]n its face, ICE’s justification appears sound:  If ICE agents use these guides to distinguish counterfeit goods, revealing the features they look for could help black market manufacturers improve the ‘authenticity’ of their products and potentially avoid detection. This explanation provides a straightforward link between disclosure and potential violations of the law.” Though the court rejected several of my objections, however, it agreed that “there is no legitimate law enforcement purpose in detecting non-counterfeit goods”:

[Tushnet] maintains that some of the material redacted from industry guides might incorrectly characterize clothing as counterfeit when in fact it is a lawful parody. Withholding such material would therefore serve no “legitimate law enforcement purpose” because ICE has no legal authority to seize these items. Tushnet points to a “No Flyers Zone” t-shirt that features the Philadelphia Flyers logo with the Chicago Blackhawks logo imposed over it as one example of an item that was mislabeled as counterfeit in one NHL product guide. The use of the Flyers logo is lawful, according to Tushnet, “because there is no confusion as to whether the Flyers sponsored the shirt.”  In addition, Tushnet presents evidence that ICE has seized other items in this same vein, which suggests a potential misunderstanding within the agency as to what constitutes trademark infringement. The examples offered by Tushnet give the Court pause because 7(E) redactions would be inappropriate if there is no risk that a law could be violated, and successful parodies do not violate trademark laws…. Given the evidence Tushnet has produced and the agency’s apparently exclusive reliance on industry guidance to discern trademark infringement, the Court finds that ICE has not sufficiently justified its 7(E) redactions and that a material factual dispute remains regarding the applicability of this exemption.

Notre Dame Scope Roundtable, part 2

Jeanne Fromer & Mark McKenna, Claiming Design

Commentators: Sarah Burstein and Rebecca Tushnet

RT: Great paper exploring the ways that different claiming regimes contribute to producers’ ability to maximize rights by claiming under multiple overlapping regimes, copyright, design patent, and trade dress. Discuss specific regimes, then overarching issues.

One key argument of the paper: Early claiming might force a designer to think more carefully, and at an earlier stage, about the ways it is likely to market the design and about extent and nature of competition their designs will face. Query whether this is only true when there is peripheral claiming, or where scope is limited very strictly to the claimed design/counterfeits thereof—early claiming by exemplar may allow for a lot of manipulation too. One example: Maker’s Mark case v. Jose Cuervo, where the registered mark is the dripping wax seal but it turns out that red is a component of the “real” mark, which quite clearly allows Maker’s Mark a better chance at validity.

The TM registration process is also more demanding in terms of limits on presentation: the PTO will refuse to register a “mutilated” mark or a phantom mark; the thing claimed must be recognizable and complete as a symbol in itself without other matter interposed or to be added later. This serves notice functions but may also make possible some intervention on scope. Should the description offered in an unregistered trade dress have to meet the same standards for clarity as the registration process? Paper says courts don’t have a uniform level of generality; is there any way to specify the appropriate level of generality w/reference to PTO practice? Drawing of the mark?

Copyright: Lack of clarity about the claim complicated Varsity Brands: the ambiguity about whether Varsity claimed only two-dimensional drawings or the designs of uniforms themselves. Varsity registered its copyright in two-dimensional drawings of cheerleading uniforms, but the Sixth Circuit treated its claim against Star Athletica as if Varsity claimed rights in the design of threedimensional cheerleading uniforms. Did the SCt understand or destroy the difference? The car example in the opinion suggests that there is a difference, but the treatment of the “uniform” design suggests that there is not.

Originality and the concept of the “work” somewhat limit the extent to which one can manipulate the exemplar in copyright, as is likely to be taken up on remand in Varsity Brands. But we are increasingly seeing that design patent lacks similar constraints. Not only does it not have a decent functionality doctrine, but the ability to claim tiny parts of a design, accompanied by lots of dotted lines, may minimize the risks of not capturing what a competitor will do, especially if you can file multiple design patents on the same object—iPhone. One possible path for the paper: instead of election of remedies, but think about whether it’s possible to limit design patents per article of manufacture—even with many points of novelty, still only one design.

Another really useful insight: visual claiming likely focuses viewers on a design’s gestalt—though perhaps in skewed ways—rather than individual features, whereas verbal claiming likely does the opposite. And verbal claiming is often unavoidable once there is a serious challenge to validity using prior art or we’re at the infringement/scope stage—this seems to be true in design patent and copyright, and courts don’t even try to avoid verbal claiming in trade dress, using the ability to articulate the trade dress in words as a proxy for the examination that the claimant has otherwise avoided by not registering.

All three regimes entail forms of central claiming because these legal regimes involve laying claim to some members of the set of designs protected by the right as contrasted with peripheral claiming, which would lay claim to all members of that set. If litigation occurs, this central claiming by exemplar is then supplemented by claiming by characteristic. Central claiming reduces the cost of claim drafting, because the drafting party need not think through and articulate at the time of claiming the metes and bounds of the design. Central claiming by exemplar is also cheaper than claiming by characteristic, and may involve simply creating the relevant work or design.

Paper says: Visual claims are necessarily by exemplar (even if labeling directs the viewer to particular characteristics of the exemplar). But we can do better with notice by specifying the best way to do visual exemplar claiming, plus supplemental claiming by characteristic. So how do we do that? One subsidiary point made by the paper: The trick of “broken line” claiming can undercut the notice provided by the claims and make it hard to manage the scope of the design rights. Examiners, competitors, or judges might perceive the level of specificity in these drawings to be much greater than they actually are. Ok, so what is the possible solution? For design patent: Requiring a claim to cover an article of manufacture plus the claimant’s ability to identify point of novelty, even if the point of novelty is the overall combination? That actually is what we do w/©, where we have a work and then the unprotectable elements get filtered out, supposedly.  And w/TM, we use the concept of source identifier to do the heavy lifting—with respect to product design, the idea of “limping marks” might also be of use, cf. the European Kit Kat case: association isn’t enough.  New thought: in dilution we’ve specified that association isn’t enough, it must be association that impairs the distinctiveness in the mark.  So too for rights in limping marks in the first place: association with a particular producer is not enough, it must be association that consumers use to identify the goods and services they wish to buy or avoid.

Sarah Burstein: Agree re: mutilation/phantom marks: separate commercial impression required for just a part. That could be an external limiting constraint—where Ugg claims any boot w/ button infringes the trade dress, maybe you need separate commercial impression.

Not sure she buys rosy picture of early design claiming—plenty of shenanigans possible.  Paper says most designs are claimed before infringement begins. Not sure that’s true, especially for litigated design patents. Maybe true of what’s on register in archives, but filed or amended post-marketing—Nike files 100 different variants. More economical approach: file whole iPhone, then keep chain of continuations in the oven.  Nordock: continuation of utility patent filed 4 years after “infringer” came on market. Earlier disclosure is good, yes.

Trade dress: Taco Cabana’s continuing ability to say that “pink is a part of our trade dress” even though it wasn’t claimed in the last Taco Cabana case. That remains a problem even after the first definition occurs through litigation.

Configuration designs—seem less concerned w/surface ornamentation/packaging—would like more clarity on that. Now after Star Athletica maybe we are going to have more conflicts w/surface ornamentation.

Big picture Q: why should we care what you claim? Still get broader scope in TM no matter what b/c of infringement standard. We didn’t always care. In 19^th c.: you could claim article of manufacture configuration, surface ornamentation, both. PTO didn’t really care.  You got the whole thing.  Curious about how that might interact w/framing effects mentioned in the paper.  TM: separate commercial impression might be a limit.  Do you want some limit on “you get what you claim”?

Fromer: What’s the connection b/t claiming and scope? You could say it’s irrelevant, but it is about framing the case/setting things up.  This paper is teeing up the fact that this process is actually going on, b/c right now it’s relatively unreflective—courts often accept the descriptions they get uncritically.  That has many effects.  There should be internalization w/in business of claiming too broadly or too narrowly; utility patents has that in spades. But utility patent is peripheral claiming; hard to do in central claiming b/c you can make inconsistent claims in central claiming—emphasize different features at different times, different levels of generality. Make them internalize costs of claiming broadly sometimes and narrowly other times. 

McKenna: Other thing difficult in TM: rights are dynamic; trade dress you have today can change tomorrow, whereas utility patent is supposed to be locked down, at least in theory. 

Lemley: struggle w/peripheral/central divide, b/c advantages and disadvantages for each. Utility patents: verbal claiming sucks. However manipulable the image is, lawyers are better at manipulating words but also creating weird unintended effects in both directions, broader and narrower scope.  One question is whether we ought to think differently about it depending on whether copying is an element of the regime in question.  Disclaimers can also be used: use of words to supplement images might not be “here’s what’s important” but “here’s what standing alone I don’t claim”—that allows a prior art analysis.  Closest prior art idea in design patent—here’s what needs to be distinguished.

Penalizing overclaiming: in the noncompete context, some courts have a no-blue-pencil rule: if it’s overbroad, we strike the whole thing—this deters overclaiming.  Is there a way to do that in design patent that shares the utility patent’s feature that if it covers the prior art it’s invalidated in its entirety?

Buccafusco: There’s a validity/creativity stage: do you have something capable of granting rights at all?  That has costs of overbreadth. There’s also a functionality screen.  There’s also a liability/scope claim. Copyright smashes them all together at the same time w/overlapping doctrines. Over regimes spread them out.  Think about costs of overclaiming at different stages? Costs w/r/t validity might not be that high if validity doesn’t create a lot of market power.

McKenna: deep down no one form is adequate.  Verbal claiming doesn’t work.  Show students verbal description of Taco Cabana, and they think it’s every Mexican restaurant ever; show them the pictures and they think, oh, it’s nearly the same.  Inescapable conclusion is that the best requires some combination of visual and verbal. Shouldn’t pretend as design patent does that you’re only doing visual, not verbal; shouldn’t do what trade dress law does, which is require verbal but often take whatever plaintiff shows up with.

Samuelson: Independent invention isn’t as much of a concern on the design patent side. What is the motivation for design patent? The possibility of getting total profits!  Perry Saidman: claims that design patents are just about stopping knockoffs. How does that fit in?  A bit more about strategic considerations that affect early/late claiming.

McKenna: very few companies create product configurations to indicate source; they figure it out later; many registered long after first use (he believes).  Lawyers dabbling in both—love design patent b/c they can get secondary meaning from design patent exclusivity—bootstrap into secondary meaning. Other strategic reason: the ability to get patents on bits and pieces, which you can’t do effectively w/TM because atomizing “mark” into bits makes source identification difficult.  Also faster than acquiring secondary meaning.

Zahr Said: there is self-claiming that’s posturing but ends up being performative via overenforcement—e.g., DMCA notices. You claim something and then you claim to own every part of it, even though the law is not that way.  Loves the idea of disclaiming.

Lemley: award extra remedies for better claiming? 

Fromer: hold people to their intentions.

Said: somewhere between claiming and estoppel.

McKenna: if I say my design is X but then claim infringement by X-1, it’s not a difference in harm, but in what triggers the harm. 

Lemley: you get a substantial benefit from claiming ex post. Markman hearing is good b/c makes you decide scope when both validity and infringement are on line at the same time.  As long as we’re doing scope before infringement we’re better off than we are today.

Fromer: might not help w/all notice but would help in specific inquiry.

Burstein: might also get a design patent b/c there’s no use requirement: can stop making handbag and still claim rights.  Copying: is design patent really about deterring knockoffs? If so, that’s a very different system than we actually have.  We’d have to change the way we proved copying. Industrial design has been about mass production, which presumes access; we’re just cutting to the chase by fighting about similarity. But we do have copying-like doctrines; if there’s really close prior art, you might not have been copying the plaintiff. She sees in complaints designs that look independently created, in part b/c they’re super functional.  If it’s truly ornamental, one can expect less independent creation, but if anything goes there’s a lot of independent creation.

McKenna: real ornamentality requirement could also solve this problem.

Lemley: many of the problems are functional but not all, especially for minimalist design like rounded corners on a phone.  Not b/c it’s functional but b/c it’s simple.

Burstein: designers wouldn’t want to work in a clean room—the whole point is to find new solutions; looking at what other designers have done is important.  [There is no clean room, as there is not w/©.]

Said: courts too often find that “making choices” = protection.  No, choices for many reasons should not be protected. 

Grynberg: Fed. Cir. dominance is a problem: they control design patents but design patents aren’t their focus.

Fromer: same with PTO.  At least there are unregistered TMs so that TMs aren’t the sole province of an agency for which they are not primary as a focus.

McKenna: Fed. Cir. doesn’t like to invalidate design patents—it’s also the outlier in TM functionality; it’s an outlier in how it treats © (Oracle v. Google).

Roundtable on the Scope of IP Rights, Notre Dame Law School

Barton Beebe & Scott Hemphill, The Scope of Strong Marks: Should Trademark Law Protect the Strong More Than the Weak?

Commentators: Mike Grynberg and Mark Lemley

Grynberg: Doctrine developed for certain situations may not make sense for other situations, including the relevance of strength. (1) Why does strength play such an important role in TM litigation? (2) Can we be sure that super-strong marks resist confusion at low levels of similarity/product relatedness? (3) normative implications.

(1) Maybe courts just misunderstand relation b/t TM strength and confusion, or maybe they’re enacting assumptions about free riding into law. But equating strong marks w/likely confusion could also be a heuristic for judges/juries. Beebe’s earlier work on multifactor test: one thing judges do is stampede the factors. Representative heuristic: cases w/strong or well-known marks correspond to our mental model of what TM infringement is.

(2) Consumers can be loyal to a weak mark & recognize differences. How do we characterize the consumers w/in the curve described by strong/weak marks? We need to be able to describe the consumers—some will simply not know the mark; others will know and be familiar; others will know and be unfamiliar/not alert. For famous marks, maybe the proportion of “alert”/difference-noticing consumers is higher, but maybe it’s higher for weak marks too because they simply don’t know the mark; there’s nothing to be confused about. Maybe famous marks include fewer consumers who don’t know anything, but maybe the shift is to a greater share of careless consumers who know a little but aren’t very alert. Strength and familiarity may not be the same thing.

(3) Sometimes the paper seems to gesture at: Normatively, reasonable consumers should not have been confused. Even if the strength story were true, then, we might want to ignore it: inattentive consumers are not protected; reasonable consumers exercising ordinary care is a standard that doesn’t necessarily have anything to do with the treatment of strength as such. Strength is a proxy for a general removal of context?  If this isn’t strictly about strength, then solutions could be properly directed at cabining the causes of action or creating safe harbors such as for referential uses.

Mark Lemley: Why care about strength at all? We could just ignore it, but the point of the paper is not that it’s irrelevant but that it’s relevant in ways we don’t currently treat it in the law. Can you use this argument in reverse: I have a weak mark so I should get more protection?  Or is it that strong marks don’t get much protection and weak marks don’t either?  One way to deal w/this might be inherent distinctiveness. We lump together two very different concepts. Acquired distinctiveness might diminish likely confusion, but inherent distinctiveness might have no impact at all, or the impact is different.  Apple v. Pineapple Computer, at outset of Apple’s existence—[to me this is the Lollipops v. Jellybeans roller rink case]—inherent distinctiveness can support a finding of confusion in a way acquired can’t b/c a person only vaguely familiar might think “fruit—computer—oh yeah, I recognize that.”

Strength might change the type of confusion we care about.  Affiliation, post-sale, sponsorship confusion.  Should we care about that?  If strength is bolstering the weakest confusion cases, that might further justify the conclusion that strength shouldn’t be used as a supporting factor. 

Dilution: where strength does the most work is dilution, b/c it substitutes for every other factor for a strong enough class of marks. There might actually be dilution proof marks.  Things that generate enough consumer awareness that you can’t dilute them—iconic, like Uncle Sam, American flag, Santa Claus—you can’t dilute them no matter how hard you try, sorry, Bad Santa.  Maybe the presence of parodies, satires, etc. ought to signal fame, with implications for “policing” theories.

Beebe: Students do relate most easily to famous examples—our ideal type of TM litigation involves super-strong marks. What is the implication, then?

Lemley: proxy for bad intent.  Nikepal?  That was chosen b/c Nike was a strong mark.  If that’s right, then we affirmatively might not care about it, b/c free riding is ok, or we might think that there are already plenty of proxies for bad faith.

McKenna: that strain of thought, there’s no good explanation for choosing this similar mark, goes back to technical TM ideas—as old as the distinction b/t different kinds of TMs.

Beebe: would like to emphasize more that our focus is super-strong marks. The paper should be just about utterly super-strong marks.  Phase shift: widely recognized by general consuming public, and known very well. Inverted U phenomenon we’re arguing for is limited to those super-strong marks. If well known, consumers know it well and can identify differences.

Does it work in reverse is a fantastic question. Didn’t address it in the interests of simplicity but now we can.  Quick answer: superstrong marks is our focus, but talking about the inverted U as a whole is useful. Normative commitment is narrower, so resists the weak marks should get broader protection idea, but should think about it. 

Beebe: Practitioners say affiliation confusion still exists, so Beebe/Hemphill argument is irrelevant.  Strength = knowledge not just of signifier but of other contextual elements.

Lemley: one implication might be that if strength does the work in affiliation confusion, that’s less valuable/more dangerous and a reason to discount strength.  Identical marks in radically different contexts might be of interest.  If someone outright copies a random coffee shop logo to sell soap in a different city, it’s not clear whether we should even care; who is harmed?  Copying Apple logo to sell soap will attract attention in a different way (not just b/c it’s aesthetically appealing) and that might be different, at least as a proxy for bad faith.

RT: Drawing on Lemley’s point.  Strength and affiliation confusion: maybe strength increases likelihood of confusion for these types of confusion (including post-sale) if we think these types worth having, but only after a certain level of similarity is reached.  May also make a product category difference; what kinds of marks are likely to engage in sponsorship etc. relationships and with what other products.  NASCAR sponsorships v. other types of relationships: anyone might sponsor NASCAR, but not anyone would affiliate with anyone else, including a competitor (which also has implications for MTM Watch type cases).  Fortres Software case—some insights there that might deserve actual theoretical elaboration and connection to other doctrines; maybe also Land O Lakes!  Those cases don’t tell you what to do in the next case that arises, but they’re also not wrong: there are differences in plausibility of confusion claims.

Are there super-strong marks w/in category?  Old Lexis v. Lexus case: is Lexis super-strong w/in its category?  Interaction b/t product similarity and mark secondary meaning.  So w/in category, may be easier to distinguish small differences or you’d expect “a Lexis Nexis company,” whereas Lexad doesn’t have that implication. 

Jim Gibson: If we got rid of strength, would intent and actual confusion do the same work?

Pam Samuelson: A mark that stays in one category for a long time, even if it’s super-strong, may be unlikely to affiliate with other products.  Honda makes cars; Apple by contrast keeps expanding the kinds of products it makes.

McKenna: is strength even an empirical matter, or a reward for having chosen a good mark/having built goodwill. Samuelson’s strength is not goodwill/familiarity but more like marketing theory—if you’ve seen a bunch of market extensions, the likelihood that you’ll see another as a market extension is higher.  Law assumes strength equals greater familiarity equals greater likelihood of confusion.  Can’t have it both ways—can’t be a theory of confusion but not helpful in dispelling confusion.  In terms of “no good reason for you to pick that mark” that came from a technical TM background that required direct competition—if you’re directly competing and using the same technical TM, there probably is no good reason. But once we blow that up, the work that strength does changes—lets you enforce it against broader range of goods and services—and old assumptions don’t make sense.  Paper can illuminate the difference b/t strength w/in category, which might give you more scope w/in category but not outside it, and strength across categories.

Lemley: what do we do about Nikepal then?  The absence of plausible explanation other than drawing from strength of mark is true even w/o identity.

McKenna: true, but that’s dilution or nothing.  If the law’s assumption is right, you should only be able to win if you show a survey, showing high levels of confusion—not just 15%.  If you can’t that’s pretty telling.

Chris Buccafusco: higher level brands may feel more confident to spin off products—popularized whiskey may be more likely to try out beer.  Budweiser will put its name on all sorts of drinks.  Whiskey has whiskey aged in beer casks, beer aged in whiskey casks—those markets are now interrelated.  Jameison’s will be more likely to try that than a non-well-known brand. 

McKenna: actually exceedingly rare to be in beer and spirits industries.  There’s expansion in cider but it’s interesting if consumers think that.

Buccafusco: Consider also that 90% of the value of a LV bag is the signalling function; maybe confusion over that is more important than confusion over a mark that is source identifying but not socially signalling in the same way.

Grynberg: Consider pieces of a mark—the Maker’s Mark red wax seal—you could have appropriation but not of the whole; the paper seems to assume the whole mark is there.

Lemley: maybe a difference b/t word, image, and product configuration marks—but that may be about skepticism about product configuration trade dress.

McKenna: plausibility of alternative explanations for using configuration may be much higher by default.

Reading list: Placebo effects of marketing

Yann Cornil et al., Does Red Bull Give Wings to Vodka? Placebo Effects of Marketing Labels on Perceived Intoxication and Risky Attitudes and Behaviors Forthcoming, Journal of Consumer Psychology

Abstract:

Why sexual assaults and car accidents are associated with the consumption of alcohol mixed with energy drinks (AMED) is still unclear. In a single study, we show that the label used to describe AMED cocktails can have causal non-pharmacological effects on consumers’ perceived intoxication, attitudes, and behaviors. Young men who consumed a cocktail of fruit juice, vodka, and Red Bull felt more intoxicated, took more risks, were more sexually self-confident, but intended to wait longer before driving when the cocktail’s label emphasized the presence of the energy drink (a “Vodka-Red Bull cocktail”) compared to when it did not (a “Vodka” or “Exotic fruits” cocktail). Speaking to the process underlying these placebo effects, we found no moderation of experience but a strong interaction with expectations: These effects were stronger for people who believe that energy drinks boost alcohol intoxication and who believe that intoxication increases impulsiveness, reduces sexual inhibition, and weakens reflexes. These findings have implications for understanding marketing placebo effects and for the pressing debate on the regulation of the marketing of energy drinks.

Reading list: Pam Samuelson on bottom-up and top-down theories of fair use

Pamela Samuelson, The Relative Virtues of Bottom-Up and Top-Down Theories of Fair Use

A Response to Abraham Bell and Gideon Parchomovsky, The Dual-Grant Theory of Fair Use,

83 U Chi L Rev 1051 (2016).

Abstract: This Essay explains why I think that Dual-Grant takes an unduly narrow view of the work that fair use does and should do in US copyright law, is blatantly inconsistent with existing case law in more ways than it acknowledges, fails to recognize important values found in many fair use cases, and would, if followed, have the unintended consequence of making fair use more unpredictable and incoherent than it is now.

internal studies on consumer preference support class action treatment for weed killer claims

Martin v. Monsanto Co., No. 16–2168, 2017 WL 1115167 (C.D. Cal. Mar. 24, 2017)

This case grants class certification, illustrating the use of internal consumer research in class action practice.  The probabilistic nature of consumer reaction is not necessarily a great fit with class actions, but the use of presumptions can deal with that, as here.

Monsanto makes Roundup Weed & Grass Killer Concentrate Plus and Roundup Weed & Grass Killer Super Concentrate. Unlike “Ready-to-Use” Roundup, these concentrates must be diluted with water before use. A prominent sticker on the front neck of the bottle states that the product “Makes Up to __ Gallons”:  

 

bottle with "makes up to 42 gallons" prominent on neck

On the back label of the bottle, the instructions advise users to “Add 6 fl oz Per Gallon of Water” for Concentrate Plus, or “2 1/2 fl oz Per Gallon of Water” for Super Concentrate. Martin alleged that, when users follow the instructions on the back label, the concentrates only produce about half of the amount that Monsanto claims on the front neck sticker.  Additional instructions are in a pamphlet sealed under the back label, which can be opened before purchase, but it’s not clear how many consumers do that. The instructions state that, for best results, consumers should use the amounts provided on the back label, but that, for “easy to kill weeds such as seedlings,” the purchaser may add less concentrate per gallon of water. Only in that case will the concentrates make the amount claimed on the neck sticker.

Martin brought the usual California advertising/warranty claims.

Analysis of note: Monsanto argued that Martin wasn’t typical because she “did not read the instructions prior to purchase,” but failed to present any evidence that any significant portion of the class read the pamphlet or fold-out prior to purchase, or, specifically, the alternative mixing instructions for “easy to kill weeds such as seedlings.” Martin had evidence that she acted like thousands of other purchasers. And “a plaintiff’s individual experience with the product is irrelevant where, as here, the injury under the UCL, FAL, and CLRA is established by an objective test…. [I]njury is shown where the consumer has purchased a product that is marketed with a material misrepresentation, that is, in a manner such that members of the public are likely to be deceived.”

Monsanto argued that Martin was an inadequate class representative because she “seeks less in damages than the purported class members could receive outside of a class litigation through a full refund.” Monsanto’s consumer guarantee states: “If for any reason you are not satisfied after using this product, simply send us original proof of purchase and we will replace the product or refund the purchase price.” But people who sought refunds weren’t adequate class representatives, because they aren’t class representatives at all, and members who want a refund were free to opt out.

Predominance: Monsanto argued that class members had varying reasons for purchasing the concentrates, making materiality and reliance predominating individual issues. But for breach of express warranty, and for violations of the UCL and FAL, Martin didn’t need to prove individualized reliance. And, while reliance is an element of the CLRA, “an inference of common reliance arises if representations are material, and materiality is judged by an objective standard rather than any understandings specific to the individual consumer.”

At this stage of the litigation, Martin provided sufficient evidence of materiality to the reasonable consumer to make class certification appropriate. Monsanto’s own documents and consumer studies did the work. Monsanto itself considered its Gallons statement to be a “key claim[ ].”  A 3,000 person consumer research study found that “[w]hen asked what helps them make a purchase decision about what concentrate product to buy at [the] shelf,” 42% of respondents selected “How many gallons of product you can make,” which was the third-highest of 13 factors. Two-thirds of those who purchased concentrated herbicide did so because of “Value (price per oz. is cheaper than ready-to-use).” When researchers presented focus group subjects with a mock shelf of herbicide products, they observed that “Price to gallon ‘best value’” claims caught consumers’ eyes with “some frequency,” with “some consumers actually d[oing] the math on their notepads for various brands.”

A presumption of reliance is inappropriate when class members “were exposed to quite disparate information,” but here, there was no evidence that class members could buy the products without being exposed to the representations at issue. In “cases involving product labels,” courts “reasonabl[y] ... infer that the class members were exposed to the allegedly misleading statement at the point of sale.”

Similarly, Martin’s damages models were tied to her theory of liability and could be measured on a classwide basis. The “underfill” percentage could be calculated by comparing the number of gallons made when following the instructions on the back label with the number of gallons promised on the neck label. This number could then be multiplied by the retail price to obtain a standard damage amount for each bottle. This benefit-of-the-bargain model was adequately tied to Martin’s theory of liability on her express warranty claim and appeared to be capable of measuring damages on a classwide basis, since the methodology was identical for every purchaser and for any given bottle size.  Likewise, her restitution damages model was adequately tied to her theory of liability on the UCL, FAL, and CLRA claims and appeared to be able to measure damages on a classwide basis.  Class members bargained for a certain price-per-gallon: the average retail price divided by the number of gallons promised. This number could serve as a proxy for the actual value-per-gallon of spray solution and multiplied by the number of gallons the products actually supplied to determine the actual value of the products. Monsanto could challenge these models through cross-examination at trial.

Finally, Monsanto’s refund policy didn’t make class treatment inferior.  Under the plain language of Fed. R. Civ. P. 23(b)(3), “[t]he analysis is whether the class action format is superior to other methods of adjudication, not whether a class action is superior to an out-of-court, private settlement program.” 

Plaintiff doesn't have to rebut 230 immunity in complaint against multiple parties

Moretti v. Hertz Corp., No. 14-469, 2017 WL 1032783 (D. Del. Mar. 17, 2017)

Moretti sued for violation of California’s false advertising, consumer protection, and unfair and deceptive trade practices laws, and common law fraud.  Moretti alleged that prices for car rentals in Mexico were advertised in U.S. dollars but later converted into Mexican Pesos at an artificially inflated rate, leading him and other consumers to pay more than the advertised price for their rentals as a result. Defendants also allegedly failed to inform consumers that the purchase of liability insurance was mandatory, disclosing terms and conditions stating the contrary. Hertz and Dollar Thrifty allegedly supplied the misleading information about car rental prices and terms to Hotwire, and Hotwire incorporated the content into listings on its website. Hotwire allegedly continued to do so despite consumer complaints and Hotwire’s knowledge of the information’s fraudulent content.

Hotwire moved for judgment on the pleadings under §230.   The court found that a complaint need not affirmatively negate any of the elements of Section 230 immunity. Immunity under §230 requires Hotwire not have “contribute[d] materially” to the offending nature of the content, and the complaint was silent on that. “Taking the well-pleaded factual allegations as true, there is no basis in the Complaint from which the Court could conclude that Hotwire did not function as an ICP and did not contribute materially to the alleged misrepresentations.”  Some §230 cases can be decided on the pleadings, but not this one; “the Court cannot treat the Complaint’s silence as to whether Hotwire materially contributed to the false statement as an affirmative allegation that Hotwire did not do so.”  The court was influenced by counsel’s representations at oral argument that, “if needed, [Morelli] could plead sufficient facts to show that Hotwire is not entitled to the protection of Section 230 immunity.”  Given that additional facts would help the parties and the court to understand the case, the court ordered Morelli to amend the complaint “to include any specifics which are in his possession that help to show why Plaintiff believes Hotwire is not immune under Section 230.”

False advertising of sperm donor leads to wrongful birth claim

Doe 1 v. Xytex Corp., No. C 16-02935, 2017 WL 1112996 (N.D. Cal. Mar. 24, 2017)|

A false advertising case arising out of a wrongful birth claim: Does One and Two used xytex.com, which sold human semen for use in artificial insemination. Xytex’s website stated that it is “an industry leader in reproductive services with a commitment to unsurpassed quality controls,” that the donors’ personal health and family history were carefully screened through a comprehensive medical process developed by the CDC, that Xytex’s “FDA-mandated screening and testing also ensures our donors’ continued good health,” and that the screening process was so thorough that a mere “1 percent of the men that inquire about being a donor candidate are evaluated,” and, ultimately, “[f]ewer than 5 percent of the candidates become donors”  The Does alleged that they believed, based on the website, that Xytex was the sperm bank with the most rigorous qualification standards. They allegedly asked a Xytex representative if she knew of any Xytex sperm donors that had “a particularly impressive health and education history.” The representative identified Donor #9623, and stated that “his sperm had already been used to successfully inseminate women and it would be sold out as soon as his profile was published.” She also stated that Donor #9623 was “ultra intelligent” and that he looked “like a model.” The Does bought sperm from Donor #9623, and Doe One ultimately gave birth to P.S.

Nine years passed, and then the Does saw an article about a lawsuit specifically relating to Xytex Donor #9623, who was a mentally ill schizophrenic felon who had pled guilty to residential burglary. He had dropped out of college and held no degrees whatsoever; Xytex also altered his photos, removing a large facial mole.  Doe One expressed her concern to an agent of Xytex, who said that she was not aware “of any reported medical issues” related to Donor #9623; Doe One also received an email from the Chief Medical and Laboratory Director for Xytex, who said that he had “received no information to confirm that Donor #9623 has schizophrenia” and that it “would be irresponsible of Xytex to notify clients of unsubstantiated claims.”

Plaintiffs further alleged: When Donor #9623 first came to Xytex, he worked as a janitor/waiter and had dropped out of school. He’d already been hospitalized, as an adult, for mental health reasons, at least twice. During these hospitalizations, “the medical staff of two different hospitals diagnosed Donor #9623 with psychotic schizophrenia, narcisstic personality disorder, and significant grandiose delusions.”  He also had an extensive criminal history.  Xytex’s “rigorous qualification procedure” “included filling out a questionnaire on his first visit and undergoing a ten-minute physical examination, in which the examining physician did not discuss Donor #9623’s physical or mental health history.” Donor #9623 told Xytex that he thought his IQ was about 130, but Xytex’s representative “suggested to him that he was a genius with an IQ of about 160.” She further told him that the more educated donors did well selling their sperm, and that Xytex usually dealt with donors with higher education.  “Xytex alleged that it had no knowledge of either Donor #9623’s medical or criminal record.”

The Does alleged that their child needed counseling and that they’d suffered other expenses and mental stress, as well as needing funds “to evaluate and care for their child to ensure that should she become schizophrenic, she will have the best care possible.” They sued for intentional misrepresentation, negligent misrepresentation, strict products liability, products liability based on negligence, breach of express warranty, breach of implied warranty of merchantability, battery, negligence, false advertising, wrongful birth, specific performance, punitive damages, and violations of the California Unfair Competition law.

For the misrepresentation claims, Xytex argued that “Buyer Beware” should apply, “but plaintiffs had no way to conduct due diligence on Donor #9623 whose true identity was hidden from plaintiffs by Xytex. Only Xytex knew his true identity and was able to conduct any diligence.”  The Does also sufficiently alleged damages caused by the misrepresentation in the form of expenses for monitoring the child over and above ordinary preventative medical care.

On scienter, Xytex argued that plaintiffs failed to allege that Xytex knew about Donor #9623’s misrepresentations about himself. But they did allege that the information regarding Donor #9623’s medical health history, as well as his criminal record could have easily been discovered “through publicly accessible, indisputable, medical and professional documents,” especially in light of Xytex’s proclamation of its “intense and arduous” qualification process that “generat[es] a lot of medical, psychological, genetic, and social information.” The court concluded that, on the allegations of the complaint, “Xytex surely knew that it failed to screen up to the standard it advertised. This alone would show reckless disregard and therefore is adequate to show that Xytex acted with scienter.”

Negligence/wrongful birth claims also survived, but not breach of warranty because California law made the relevant statutory provision inapplicable to tissue-related activities such as sperm sales. A medical battery claim was also dismissed, because the insemination was carried out by separate third parties and Xytex never committed an intentional or offensive touching of Jane Doe One.

Now, false advertising: Xytex allegedly violated the UCL/FAL by promoting misleading information about the nature, characteristics, and qualities of Donor #9623.  The alleged facts supported the reasonable inference that Xytex acted recklessly as to its misrepresentations.  A claim for punitive damages also survived.

Dastar/preemption bars claims based on allegedly false claims of credit for innovation

OptoLum, Inc. v. Cree, Inc., No. CV-16-03828, 2017 WL 1057924 (D. Ariz. Mar. 21, 2017)

The parties compete in the market for LED lights. OptoLum claims to be the inventor of technology used inside LED bulbs allowing them to have the look and feel of traditional incandescent bulbs.  It alleged false advertising under the Lanham Act, an unjust enrichment claim, and two patent infringement claims (which I will not discuss).

The court found that these claims were puffery:

• The “Cree Filament Tower™ Technology” is “the genius idea inside” the Cree LED bulb;

• Cree “found a way to put the LEDs in the center of the bulb like a traditional light bulb” and “we’re making an LED but we are actually inventing all the technology in between”;

• “[O]ne of the technical breakthroughs that enabled Cree to break the $10 threshold is our new Cree Filament Tower™ Technology. The Filament Tower™ is the Cree innovation that lets our LED bulb replicate the look and feel of filament based traditional lights”;

• “[Cree] engineers came up with a very elegant solution to the design issues inherent in LED bulbs. In a compact form, the Filament Tower produced the light dispersion we wanted without problematic heat building”;

• “[I]nventing the LED technology that delivers like an incandescent was hard work, but designing a bulb in a form-factor that consumers trust at a price they can afford was even harder. Designed with Cree LED Filament Tower Technology, the Cree LED bulb represents a breakthrough in LED bulb design and performance”; and

• “[Cree] invented the lighting-class LED.”

The court found these all nonactionable puffery as a matter of law.   The claim that Cree’s Filament Tower Technology was a “genius idea” was “the epitome of puffing.” Likewise, the other statements about “breakthroughs” were “not specific, not concrete, not measurable, and therefore puffery.” A “very elegant solution” was “sufficiently imprecise to constitute puffery,” as were the “look and feel,” “long useful life,” and “energy efficiency and low cost” claims.

OptoLum argued that Cree falsely claimed that it was the source of ingenuity, innovation, and technological breakthroughs attributable to OptoLum.  The court replied: Dastar.  A contrary holding would create a conflict with the Patent Act.

Similar reasoning doomed the unjust enrichment claim.  OptoLum alleged that there was significant value in being perceived by consumers as an innovator, inventor, and creator of groundbreaking technology. But patent law preempts an unjust enrichment claim based on such grounds.  Given that the plaintiff’s right to relief would depend on resolving inventorship, a substantial question of patent law, patent law preemped “any state law that purports to define rights based on inventorship.”  While a contract implied in fact could support an equitable unjust enrichment claim if no formal contract existed between the parties, those weren’t the allegations here.

Nursing homes' claims are puffery

Commonwealth of Pennsylvania v. Golden Gate National Senior Care LLC, No. 336 M.D. 2015, --- A.3d ----, 2017 WL 1075535 (Comm. Ct. Pa. Mar. 22, 2017)

Golden Gate manages and operates 36 skilled nursing facilities in Pennsylvania.  The Commonwealth sued for: (1) Unfair Trade Practices and Consumer Protection Law (UTPCPL) violations; (2) breach of contract; and (3) unjust enrichment. I’ll consider only the advertising-related claims.

The UTPCPL does not apply to providers of medical services, but nursing homes are “hybrid organizations, offering both medical and non-medical services.” They are liable under the UTPCPL only as to the non-medical services they provide. 

The Commonwealth challenged chain-wide marketing statements that the court found were puffery:

·       “We have licensed nurses and nursing assistants available to provide nursing care and help with activities of daily living (ADLs). Whatever your needs are, we have the clinical staff to meet those needs.” This claim was “expressed in broad, vague, and commendatory language.”

·       “Snacks and beverages of various types and consistencies are available at any time from your nurse or nursing assistant.” Likewise, as applied to the Commonwealth’s allegation that there was insufficient staffing to timely respond to residents’ requests.

·       “A container of fresh ice water is put right next to your bed every day, and your nursing assistant will be glad to refill or refresh it for you.” This was mere “subjective analysis or extrapolations, such as opinions, motives and intentions, or general statements of optimism.”

·       “Clean linens are provided for you on a regular basis, so you do not need to bring your own.” This claim was “vague” and undefined.

·       “Providing exceptional dining is important to us. Not only do we want to meet your nutritional needs, but we want to exceed your expectations by offering a high level of service, delicious food and an overall pleasurable dining experience. … We have a seat reserved for you in our dining room!”  This was puffery expressing Golden Gate’s “priorities and intentions for residents, rather than makes specific objective representations about the quality of the dining experience.”  Though the Commonwealth alleged that residents couldn’t use the dining facilities due to staffing shortages, the “reserved seat” claim wasn’t a promise that residents would always be brought to the dining facilities.

·       “[W]e believe that respecting your individuality and dignity is of utmost importance.”  The “we believe” was enough to signal “subjective analysis or extrapolations, such as opinions, motives and intentions.”

·       “A restorative plan of care is developed to reflect the resident’s goals and is designed to improve wellness and function. The goal is to maintain optimal physical, mental and psychosocial functioning.”  The Commonwealth didn’t allege that the plans weren’t developed, but that they were incomplete or not properly followed/updated. The description of the plan was aspirational puffery.

·       “We work with an interdisciplinary team to assess issues and nursing care that can enhance the resident’s psychological adaptation to a decrease in function, increase levels of performance in daily living activities, and prevent complications associated with inactivity.” Again, there was no allegation that there was no such interdisciplinary team; the rest was puffery.

·       “Our goal is to help you restore strength and confidence so you feel like yourself again and can get back to enjoying life the way you should. That’s The Golden Difference.”  Too subjective.

The Commonwealth also alleged facility-level misrepresentations, but statements in assessments of individual residents, care plans, and bills for services not provided weren’t advertising or promotion (borrowing the Lanham Act definition).  Statements by individual employees/agents weren’t enough, and “representations made in resident care plan development are not likely to make a difference in the purchasing decision, since such representations are made after an individual is admitted and becomes a resident.”

One judge concurred in part, agreeing with the puffery conclusion but would have held that one portion of the UTPCPL, Section 2(4)(xxi), establishes a cause of action to remedy “any ... fraudulent or deceptive conduct which creates a likelihood of confusion or of misunderstanding,” and doesn’t require an ad; she would have allowed the claim “insofar as it alleges deceptive conduct involving bills and care plans which could directly impact purchasing decisions.”