RC = Rolf Claessen
KS = Kenneth Suzan
JW = John Welch, Author of the TTAB Blog
BD = Dr. Brian Dorn from Barnes & Thornburg LLP
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KS: Hello and welcome to this episode of IP Fridays. Our names are Ken Suzan and Rolf Claessen and this is THE podcast dedicated to intellectual property. It does not matter where you are from, in-house or private practice, novice or expert, we will help you stay up-to-date with current topics in the fields of trademarks, patents, design and copyright, discover useful tools and much more.
RC: The first thing we want to talk about is fee reductions at the USPTO. Ken, can you fill in our listeners on this?
KS: Rolf, there may be some good news for practitioners to report to their clients in the coming months. That’s in connection with a proposed rulemaking that the USPTO issued on May 9, 2014. The USPTO is proposing to reduce certain trademark fees and
also to promote efficiency for their customers. They are talking about reducing the application filing fee by $50 where the current filing fee is $325 to $275 per class. They are also looking at lowering the TEAS Plus option by $50 where that would be lowered from $275 to $225 per class. There will also be some fee reductions for renewals. That definitely is indeed good news which may come down the pike if everything goes forward at the USPTO with their rule making. One quote I thought was of interest is from the Deputy Under Secretary of Commerce for Intellectual Property and Deputy Director of the USPTO, Michelle K. Lee. Ms. Lee states, “The proposed fee reductions advance the USPTO’s core mission of serving the public in the most efficient and cost effective manner possible.” She goes on to say, “Lower fees will lessen the burden for entrepreneurs to obtain the crucial trademark protection they
need to grow their businesses, while increased electronic processing improves agency
efficiency.” Rolf, comments are due to the USPTO by June 23rd and people can go
online to TMFRNotices@uspto.gov for submitting their electronic comments. We will
put a link to that email on ipfridays.com.
RC: If you want to know more about this, please enter www.ipfridays.com/usptofees.
Next up is an interview with John Welch, author of the TTAB blog.
INTERVIEW BETWEEN ROLF AND JOHN WELCH, AUTHOR OF THE TTAB BLOG
RC: I am happy to meet John Welch today at the INTA meeting in Hong Kong. He is the author of the TTAB blog, a very famous blog and probably one of the most popular blogs in the IP world. Thank you very much for being here today.
JW: Thank you for inviting me Rolf.
RC: Why don’t you tell our listeners a little bit more about yourself?
JW: Ok. I am glad you invited me today because I think after a couple of months from now you might not be talking to me after the United States knocks Germany out of the World Cup. But that remains to be seen.
I am an attorney who practices law in Cambridge, Massachusetts. I have been practicing law for nigh on four decades of both patent law and trademark law. But in recent years, I focused more on trademarks. About ten years ago, I started up the TTAB blog. It is about to reach, as I say, its tenth anniversary. I try to keep track of the Trademark Trial and Appeal Board, both for my own edification but also because I like to write about it and I like to blog about it and that’s how it came about.
RC: So John, why don’t you tell us more about the TTAB. Most of our listeners may not be familiar with the TTAB.
JW: Sure, let me just preface it by saying, for people who are not familiar with the Trademark Trial and Appeal Board (TTAB), it’s the body in the Federal Government in the USPTO that hears appeals both from examiner’s decisions, I shouldn’t say “both”, it hears appeals from examiner’s decisions and it also hears inter partes matters involving oppositions and cancellations. The Board only deals with registrability. It has no authority to stop somebody from using a mark. No authority to grant any attorney fees. So it is strictly an administrative procedure that has to do with whether a mark will be registered or not. It, nonetheless, serves a very important function in American trademark law because for one thing the Trademark Trial and Appeal Board is kind of where the rubber hits the road with regard to trademark prosecution and application questions as to what the examining core will require on the application and what the applicant has to do to satisfy the examiner. On the inter partes side it serves as a very useful tool for parties to kind of protect their marks and stop people from cluttering the register with marks that might be confusingly similar and it is a relatively low cost way of staking your claim and trying to resolve the dispute on an administrative level without the hurry and the expense of a federal court litigation. Many Trademark Trial and Appeal Board proceedings are settled. I would say 99% of them are settled. I have been doing this for, as I said, four decades and I have probably had one dozen cases that have gone all the way to trial, including testimony. Almost always they get off track one way or another. One side will give up or they will come to a settlement. The thinking is, at least in my thinking, if there is a real problem, there will be a lawsuit. So these are kind of not the most pressing issues for the parties. It is a way to keep your registration strong and keep the register clean without the expense, as I said, and the rapid movement that a lawsuit requires.
RC: It is very amazing, 99% settlement, that is something that is never heard of in Germany I guess. The body never has to decide.
JW: Well maybe because in the U.S. litigation is so expensive that the parties decide it is not worth it. Particularly if all you are talking about is registerability. Often one can come up with a solution that satisfies both sides by changing the mark a little bit or changing the goods or services in the application and agreeing not to do this or that, so very often you can come up with a solution. If the marks are dead ringers, then often the losing side will recognize that and give up. Maybe in Germany, as I understand it, you don’t have the discovery procedures that we have in the U.S. which tends to run up the cost and drag these things out where in the U.S., if you were able to get a quick decision, then probably a lot more cases would go to decision. But having done this for many years, I can tell you that there are various ways to delay these things and run up costs from the other side and kind of force it into a settlement mode if you want to do that.
RC: Right, so what is the actual work that the members of the board of the TTAB are doing? Are they working? I mean, they do, but…
JW: Yes, yes they do. They probably issue 600 or 700 final decisions per year. So they are handling all of those. They handle many summary judgment motions, maybe a couple of hundred of those. They have a staff of interlocutory attorneys, I should say there are 21 judges. They have a staff of interlocutory attorneys who handle the day-to-day motion practice; motions to compel discovery, motions for this or that. When you are practicing before the TTAB, if you want to get more time or a delay, you file a motion for something, you file a motion complaining about the other side’s discovery requests, blah blah blah, so you can usually keep these things boiling for four, five, six years before they ever get decided. Of the 700 decisions that the Board issues per year, some are pretty long. You can have a decision that is 60 or 70 pages long and is rather detailed and they have sometimes enormous records to go through with testimony and depositions. So they have a considerable case load even though maybe the number of decisions, say 700 divided by 21 I guess which is, I don’t know, 30 or 35 final decisions each, but some of them are really voluminous and they have to pour through the records and then lay out a decision that explains their reasoning so that one can appeal.
RC: So they do have a lot of work to do.
JW: I think do, yes.
RC: Next time maybe you will tell us more about interesting case law so dear listeners stay tuned in two weeks when we hear more about the case law in the U.S. If you want to learn more about John L. Welch and his TTABlog please go to www.ipfridays.com/ttab.
Next up is Ken Suzan with an interview about two recent Supreme Court cases in the patent field.
INTERVIEW WITH KEN SUZAN AND DR. BRIAN DORN OF BARNES & THORNBURG LLP
KS: Rolf, I am here with my colleague, Dr. Brian Dorn, who is of counsel here at Barnes & Thornburg LLP and I am talking to Brian today about two important Supreme Court cases. On April 29th of this year, the United States Supreme Court issued two decisions on patent cases. Brian, what was the issue and how are these cases related?
BD: Well, the two cases were the Highmark and the Octane Fitness cases and they dealt with the same issue and they were both the issue of rewarding attorney fees to the prevailing parties (i.e. fee shifting). In the U.S. typically each side pays their own attorney fees, win or lose. However under 35 U.S.C. § 285, fees can be awarded to the prevailing party in exceptional cases such as material inappropriate conduct or suits brought in subjective bad faith.
KS: And what were the decisions exactly as issued by the Court. Why should listeners take note of these?
BD: Typically it has been a pretty high standard to get fees awarded to the prevailing party. In one of these cases it was awarded to the prevailing party and the District Court and the Federal Circuit overturned that and then hence now the Supreme Court has overturned that. They have found that the meaning of exceptional is simply one that stands out from others with respect to the substantive strength of a party’s litigating position. So they overturned the Federal Circuit with what they deemed as too rigid of a standard. Instead of clear and convincing evidence to establish an entitlement of fees, they simply had an evidentiary burden so there would be more deference to the District Court in the terms of findings of fact.
KS: And the significance going forward for companies and practitioners… how is this going to change the landscape?
BD: The real significance of this case I think is really in terms of the patent troll litigation in that the abusive litigation trolls, instead of maybe the true patent litigation, but these abusive tactics where companies are just suing multiple defendants and all they are really seeking is a settlement that’s less than the cost of litigation, basically kind of a shakedown. So because of the cost of defending it, companies were more apt to pay because it is just cheaper. However now with this kind of change in standard it is more likely and more favorable to actually fight these cases. The companies can go and try to fight these cases which are typically not the strongest of patent claims and in these cases it will be easier to get those fees awarded to them for fighting these cases and this really strikes the patent trolls in their business model because they really had low costs and it was really hard to attack them because their costs were so low and they really weren’t producing anything but this really attacks their model. And it is also significant because Congress has been trying to remedy the patent troll problem so to say and trying, obviously, to solve it through legislation, however it has been difficult to craft legislation that does not impinge on the rights of true inventors, particularly small entities. So hopefully this is a way to remedy the situation without getting into legislation that knee jerks or takes away rights in other areas.
KS: Right, it might be good in about six months or a year to revisit to see the effect on the troll litigation to see the impact this case might have.
BD: Hopefully it will really hit at and stop the abusive litigation that has been going on.
KS: Brian, thanks so much for your insight as always and we look forward to talking to you soon in the future.
BD: Thank you.
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You have been listening to an episode of IP Fridays. The views expressed by the participants of this program are their own and do not represent the views of nor are they endorsed by their respective law firms. None of the content should be considered legal advice. The IP Fridays podcast should not be construed as legal advice or legal opinion on any specific facts or circumstances. The contents of this podcast are intended for general informational purposes only and you are urged to consult your own lawyer on any specific legal questions. As always, consult a lawyer or patent or trademark attorney.
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