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Supreme Court Strikes Down Prohibition on “Offensive” Trademark Registration

On June 19, the Supreme Court ruled in Matal v. Tam that the Patent and Trademark Office (PTO) could no longer deny trademark registrations for “marks that disparage the members of a racial or ethnic group.” Before this decision, the PTO used the Lanham Act’s Disparagement Clause as its legal basis for prohibiting protection for offensive names. The Court held, however, that the Disparagement Clause violated the First Amendment, reasoning that “Speech may not be banned on the ground that it expresses ideas that offend.”

The Court’s decision has important ramifications for the NFL’s Washington Redskins and other sports teams with names and mascots that many consider to be offensive. The “Redskins” was considered racially offensive on several occasions by the PTO and was held to be ineligible for federal trademark registration. The Supreme Court’s decision allows for the Redskins name to receive the benefits of federal registration.

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Supreme Court Significantly Narrows Where Patent Cases May Be Brought

On May 22, the Supreme Court reversed a ruling from the Federal Circuit which allowed for patent infringement cases to be brought in any district where the defendant conducts business. Liquid sweetener brand TC Heartland was sued by Kraft Food Brands in Delaware, its state of incorporation, and unsuccessfully moved to transfer venue to the Southern District of Indiana, where it primarily conducts business.

The relevant patent venue statute, 18 U.S.C. § 1400(b), states that any patent infringement case may be brought in the district where the defendant resides or has a regular and established place of business. However, the 1957 Supreme Court decision in Fourco Glass Co. v. Transmirra Products Corp. provided a more narrow definition of “resides,” holding that “resides” refers only to the defendant’s state of incorporation. TC Heartland appealed to the Supreme Court to instead adopt the definition from the 1990 Federal Circuit case VE Holding Corp. v. Johnson Gas Appliance, which more broadly interpreted “resides” to include any venue in which a defendant conducts business.

In the 8-0 majority opinion written by Justice Thomas, the Court concluded that a domestic corporation “resides” only in its state of incorporation and thus a patent holder invoking § 1400(b) is limited to bring suit only in the defendant’s state of incorporation. The Court’s decision is a significant defeat for the many patent holders who hope to file in the Eastern District of Texas, which has become a popular forum for plaintiffs. As the majority of the defendants in these patent cases are not incorporated in the Eastern District of Texas, the VE Holding Corp. decision would likely cause many patent cases to transfer to Delaware, a common state of incorporation for domestic companies.

Supreme Court Rules That Elements of Apparel Design are Copyrightable

In a closely watched case, the U.S. Supreme Court ruled today that decorative elements of a cheerleading uniform can be protectable by U.S. copyright law.  The opinion was much anticipated because clothing has generally been considered to be a “useful article” that is not subject to copyright.  This issue has not been squarely addressed by the Supreme Court before today and lower courts were in, as the Court put it, “widespread disagreement” on the proper standard to apply.

The majority opinion was written by Justice Thomas and joined by four other justices.  Justice Thomas’ opinion held that an element of clothing could be protected if it “can be perceived as a two- or three-dimensional work of art separate from the useful article” and it would qualify for copyright “if it were imagined separately from the useful article into which it is incorporated.”  The Court found that the designs represented on the surface of the cheerleading uniform could meet that standard in principle.  (The Court demurred on the issue of whether the particular designs in question are actually sufficiently original to be copyrightable and limited its ruling to surface designs in general.)

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HBA Litigation Group Successfully Fends Off Attempt to Enjoin Use of the “New York Fashion Week” Name

In a case involving the signature events in American fashion, HBA litigators fended off a motion for a preliminary injunction that would have prevented HBA’s client the Council of Fashion Designers of America (the “CFDA”) from using the New York Fashion Week name.

New York Fashion WeekFashion Week, Inc. (“FWI”) presents fashion shows to consumers, unlike than the shows directed to the fashion industry and media that have long been the foundation of New York Fashion Week.  After using other names to put on its shows, FWI obtained a trademark registration on the Supplemental Register for the term “New York Fashion Week” in 2014.  FWI began using that name even though it only put on one show at a time, taking place on only one day.

As it had for many decades, the CFDA had continued to use the New York Fashion Week name to promote the fashion events that it had scheduled, including the semi-annual women’s fashion events.  But on June 28, 2016, FWI brought a lawsuit and motion for a temporary restraining order against the CFDA and co-defendant WME IMG LLC (“IMG”) claiming that the defendants’ use of the trademarks NEW YORK FASHION WEEK and NYFW infringed FWI’s claimed rights to those marks.  On the next day, Judge John G. Koeltl of the United States District Court for the Southern District of New York held that FWI had not made the requisite showing of irreparable harm and set a briefing schedule for FWI’s preliminary injunction motion to be heard on August 4, 2016.

In response to that motion, the CFDA argued that:  (1) FWI’s long delay in bringing its motion – roughly 18 months – negated any claims of irreparable harm; (2) FWI had not developed any trademark rights to NEW YORK FASHION WEEK and NYFW because it had no registrations on the Principal Register and could not make any showing that consumers identified those marks with FWI; and (3) the CFDA had prior trademark rights to the NEW YORK FASHION WEEK and NYFW trademarks because of its prior use of those trademarks and the public association of them with the CFDA.  In support of the last point, the CFDA submitted substantial evidence of media coverage, testimony from industry professionals, and even FWI’s own promotional materials that used those trademarks to refer to the CFDA’s events rather than FWI’s.

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HBA joins the Luxury Law Alliance

I only like luxury fashion. You have to decide where you stand. I like well-made, authentic clothes, well-crafted tailoring. I also like the dream and fantasy of luxury, the exception and rarity of it. I have no interest at all in fast retail. It is ambiguous. – Hedi Slimane

The law as it applies to luxury fashion companies is nuanced and evolving.  As such, the need to network with other lawyers working in the industry has never been greater.  The Luxury Law Alliance is the world’s first connected network for luxury lawyers. Its alumni include the best luxury companies with a network that showcases its members to the world of luxury from a legal perspective. After partner Douglas Hand attended and spoke at the Luxury Law Summit in London in May 2016, HBA was invited to become a member of the Luxury Law Alliance. HBA will continue to grow its already successful international practice headed by partner Carl Van der Zandt with engagements with fashion and luxury companies in Europe.

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