Posts Tagged: "U.S. Court of Appeals for the Second Circuit"

The U.S. Court of Appeals for the Second Circuit today invoked the Supreme Court’s decision in Jack Daniel’s Properties v. VIP Products to affirm a district court’s finding that MSCHF Product Studio, Inc.’s shoe, the Wavy Baby Sneaker, likely infringed Vans, Inc.’s Old Skool shoe. The Second Circuit ultimately affirmed the district court’s grant of a preliminary injunction and temporary restraining order for Vans. The Wavy Baby Sneaker is made by MSCHF, a Brooklyn-based art collective that “has recently focused its artistic expression on ‘sneakerhead culture.,’” according to the Second Circuit opinion. Upon release of the Wavy Baby Sneaker, MSCHF’s co-Chief Creative Officer said in a statement: “’The Wavy Baby concept started with a Vans Old Skool sneaker’ because no other shoe embodies the dichotomies between ‘niche and mass taste, functional and trendy, utilitarian and frivolous’ as perfectly as the Old Skool.”

You always remember your first jury trial. Mine happened almost 50 years ago, and I still vividly recall sitting with the partner to work on the “instructions” that the judge would be giving. He explained to me that the jury would be told what the statutes said (this was a contract case), and they would be responsible for deciding the facts that determined their verdict. As it turned out, we didn’t win, and that was the end of it. Although an appeal was possible, overturning a jury verdict is very hard to do. And that’s as it should be…. That’s why I was surprised to see the recent opinion in Syntel v. Trizetto.

On July 22, the U.S. Court of Appeals for the Second Circuit issued a decision in RiseandShine Corp. v. PepsiCo, Inc., authored by Senior Circuit Judge Pierre N. Leval, reversing a preliminary injunction entered by the Southern District of New York that prevented Pepsi from marketing its “Mtn DEW Rise Energy” canned energy drink. In reversing, the Second Circuit held that the district court had improperly construed certain likelihood of confusion factors as favoring the merits of RiseandShine’s reverse confusion theory.

Two recent decisions dealing with high-end watches illustrate the fine line between permissible and infringing modifications when the final product bears a trademark of the original maker. As the trend of “upcycling” or “creative reuse” continues to grow, entrepreneurs should be aware of the potential pitfalls in modifying the products of others. Generally, the first sale or “exhaustion” doctrine protects a reseller of authentic goods from infringement liability—but only when the goods have not been materially altered in any manner and meet the trademark owner’s quality standards. There are, however, some circumstances where courts have found certain modifications to be permissible.

The Andy Warhol Foundation has petitioned the U.S. Supreme Court, asking it to review a decision of the U.S. Court of Appeals for the Second Circuit holding  that Andy Warhol’s Prince Series did not constitute fair use of Lynn Goldsmith’s photograph. The Second Circuit held in March that “the district court erred in its assessment and application of the fair-use factors and the works in question do not qualify as fair use.” The Court of Appeals further concluded that the Prince Series works were substantially similar to the Goldsmith Photograph “as a matter of law.” The Supreme Court petition argues that “the Second Circuit’s decision…creates a circuit split and casts a cloud of legal uncertainty over an entire genre of visual art.”

On September 30, the U.S. Court of Appeals for the Second Circuit issued a ruling in Horror Inc. v. Miller in which the appellate court affirmed a summary judgment ruling in the District of Connecticut which found that Victor Miller was an independent contractor when writing the script for the 1980 classic horror film Friday the 13th. The ruling enables Miller to move forward with copyright termination notices served on Horror, which became the successor-in-interest to the rights to Friday the 13th, so that Miller can claim copyright in the original screenplay.

On August 17, in the case of I.O.B. Realty, Inc. v. Patsy’s Brand, Inc., the United States Court of Appeals for the Second Circuit ordered that the June 4, 2020 judgment of the United States District Court for the Southern District of New York be vacated for not complying with the Second Circuit’s mandate, with judgment being entered for Patsy’s Brand and the case dismissed. The decision is related to two decades of litigation. As court documents have described, the case has been protracted, highly contentious, and, at times, even scandalous.

In “big IP cases that count,” the U.S. Federal Trade Commission (FTC) has had a mixed record lately, going one-for-three – good in baseball but bad in government appellate litigation. (The biggest recent FTC loss that counts, the Supreme Court’s unanimous April 2021 AMG decision (see here), did not involve IP, but had major negative implications for the FTC’s future ability to obtain monetary relief in IP-related prosecutions). In August 2020, the Ninth Circuit vacated a district court “finding that Qualcomm had engaged in unlawful licensing practices, and reversed a permanent, worldwide injunction against several of Qualcomm’s core business practices.” (The full Ninth Circuit subsequently denied the FTC’s request for rehearing en banc, and the FTC threw in the towel in March 2021, electing not to seek Supreme Court review).

On June 8, the U.S. Court of Appeals for the Second Circuit, in Pablo Star Ltd. V, Welsh Gov’t, affirmed a decision of the U.S. District Court for the Southern District of New York denying the Welsh government’s motion to dismiss a claim of copyright infringement on the ground of sovereign immunity. In particular, the circuit court held that the activity resulting in the lawsuit fell within the commercial-activity exception of the Foreign Sovereign Immunities Act (FSIA)…. The circuit court explained that whether an activity is considered ‘commercial’ depends on the ‘nature’ of the activity, rather than the ‘purpose’, wherein nature is defined as ‘the outward form of the conduct that the foreign state performs or agrees to perform’ and purpose is defined as ‘the reason why the foreign state engages in the activity.’

On May 12, the U.S. Court of Appeals for the Second Circuit issued a decision in Sohm v. Scholastic in which the appellate court reversed in part a decision handed out by the U.S. District Court for the Southern District of New York (SDNY) granting partial summary judgment to Sohm for Scholastic’s infringement of copyright to six photographs and dismissing other claims by Sohm. Among the issues decided by the Second Circuit on appeal was an issue of first impression on group registrations. The Second Circuit decision aligned with case law from the Ninth Circuit, which has held that an individual can sue for copyright infringement covering individual works within a group registration even if that individual isn’t named as an author in the group registration.

As predicted following oral arguments, the U.S. Supreme Court today ruled that Marcel Fashion Groups, Inc. cannot preclude Lucky Brand Dungarees, Inc. from raising new defenses under federal preclusion principles, but left open the possibility that it may be appropriate to apply claim preclusion to defenses in certain circumstances. The opinion was authored by Justice Sotomayor. The Second Circuit decision was ultimately reversed and the case remanded, continuing the long battle between the two brands.

The U.S. Court of Appeals for the Second Circuit issued a decision in an appeal from the U.S. District Court for the Southern District of New York last Thursday that in part clarified that “a plaintiff prosecuting a trademark infringement claim need not in every case demonstrate actual consumer confusion to be entitled to an award of an infringer’s profits.” The Second Circuit court also remanded the case back to the District Court to apply the Octane Fitness standard for determining “exceptional” cases under the Lanham Act.