CAFC Ruling in In re Bilski Limits Patentability of Business Methods

Doug McDonald and Gary Mayback have brought to our attention that, in its 9-3 en banc decision in In re Bilski, the CAFC decided yesterday that, under 35 USC  101, business methods can be patented only if they involve use of a machine or a transformation of matter. Doug will be posting his analysis of this decision next week.  Anyone else who wants to comment on the case should feel free to use the blog’s Comment feature to post their thoughts as a comment on this post or on Doug’s post once it is up.

Ninth Circuit Upholds Customs’ Right to Impose Civil Penalty on Importer of Counterfeit Hilfiger Watches Even Though Hilfiger did not make Watches at Time of Seizure

The Ninth Circuit Court of Appeals has reversed a district court ruling that U.S. Customs could not impose a civil penalty on an importer of counterfeit Tommy Hilfiger watches because Hilfiger itself did not make watches at the time of the seizure. U.S. v Able Time, Inc., — F.3d —-, 2008 WL 4350027 (9th Cir. Sept. 25, 2008).  Able Time, Inc. imported a shipment of watches into the United States. The watches bore the mark “TOMMY,” which is a registered trademark owned by Tommy Hilfiger Licensing, Inc. Tommy Hilfiger did not make or sell watches at the time of the seizure.  However, it owned a U.S. trademark registration for the mark “TOMMY” in International Class 3 for cosmetics, cologne and similar products. The Bureau of Customs and Border Protection seized the watches pursuant to the Tariff Act, which authorizes seizure of any “merchandise bearing a counterfeit mark.”  19 U.S.C. § 1526(e).  Customs’ forfeiture action against the watches was dismissed for defective service of process and could not be re-filed because the statute of limitations had run.  However, Customs also imposed a civil penalty upon Able Time pursuant to 19 U.S.C. § 1526(f), which authorizes the imposition of a fine upon any person who imports merchandise that is seized under § 1526(e). The district court concluded on summary judgment that, because Tommy Hilfiger did not make watches at the time of the seizure, the watches imported by Able Time were not counterfeit, and the civil penalty imposed by Customs was unlawful.  The Ninth Circuit reversed, holding that Customs may impose a civil penalty pursuant to 19 U.S.C. § 1526(f) upon an importer of merchandise bearing a counterfeit mark, even though the owner of the registered mark does not manufacture or sell the same type of merchandise.  Under the Ninth Circuit’s ruling, “to run afoul of the civil penalty provision of the Tariff Act,… the offending merchandise must bear a mark identical to or substantially indistinguishable from a registered trademark owned by a United States citizen or corporation, where the offending merchandise copies or simulates the registered trademark, meaning that it is likely to cause the public to associate the offending merchandise with the registered trademark under the” traditional likelihood of confusion test applied in the Ninth Circuit (the Sleekcraft test).  It remanded the case to the district court to determine whether (1) the mark on the watches is identical to or substantially indistinguishable from the registered mark pursuant to 15 U.S.C. § 1127, and (2) whether the offending mark copies or simulates the registered mark pursuant to 15 U.S.C. § 1124, which amounts to the traditional likelihood of confusion test for infringement.

Federal Circuit defines coinventor status

The Federal Circuit has issued a decision that provides guidance in determining co-inventor status in patent disputes.  Tavory v. NTP, Inc., No. 07-1527. In an extensive discussion on inventorship, the Federal Circuit has held that an inventor must have conceived a portion of the invention, but does not have to be skilled in the art and able to reduce the invention to practice in order to be considered an inventor.  To read the decision, click here.

Florida Supreme Court throws out false light cause of action

The Florida Supreme Court has ruled that the cause of action for false light invasion of privacy is not a valid cause of action in Florida. The ruling comes in the case of Rapp v. Jews for Jesus, No. SC06-2491. To read the decision, click here.

The plaintiff in Rapp filed suit against Jews for Jesus in response to the publication of the account by the step-son of the plaintiff about the step-son’s visit with the plaintiff and the step-son’s ailing father, the plaintiff’s husband. The newsletter account read:

I had a chance to visit with my father in Southern Florida before my Passover tour. He has been ill for sometime and I was afraid that I may not have another chance to be with him. I had been witnessing to him on the telephone for the past few months. He would listen and allow me to pray for him, but that was about all. On this visit, whenever I talked to my father, my stepmother, Edie (also Jewish), was always close by, listening quietly. Finally, one morning Edie began to ask me questions about Jesus. I explained how G-d [sic], gave us Y’Shua (Jesus) as the final sacrifice for our atonement, and showed her the parallels with the Passover Lamb. She began to cry, and when I asked her if she would like to ask G-d for forgiveness for her sins and receive Y’Shua she said yes! My stepmother repeated the sinner’s prayer with me-praise G-d! Pray for Edie’s faith to grow and be strengthened. And please pray for my father Marty’s salvation.

Based upon this publication, which the plaintiff claimed placed her in a false light regarding her religious beliefs, the plaintiff filed suit against Jews for Jesus. The plaintiff also asserted claims for defamation and intentional infliction of emotional distress. The trial court dismissed the initial complaint. An amended and second amended complaint were also dismissed, and the plaintiff appealed. On appeal the Fourth District Court of Appeal rejected the defamation claim but certified the question of whether Florida recognized a claim for false light invasion of privacy to the Supreme Court of Florida.

The Supreme Court discussed two concerns raised by other courts that have rejected the tort of false light:

(1) it is largely duplicative of defamation, both in the conduct alleged and the interests protected, and creates the potential for confusion because many of its parameters, in contrast to defamation, have yet to be defined; and (2) without many of the First Amendment protections attendant to defamation, it has the potential to chill speech without any appreciable benefit to society.

With regard to the first point, the Court noted that defamation law already encompases claims that would fall under the definition of false light, such as “the concept that literally true statements can be defamatory where they create a false impression.” The Court referred to this as “defamation by implication” and cited several Florida DCA opinions that have discussed the tort, e.g., Boyles v. Mid-Fla. Television Corp., 431 So. 2d 627 (Fla. 5th DCA 1983) (reversing dismissal of libel per se claim based on statements that implied that plaintiff was a suspect in the death of the child, was a habitual tormentor of retarded patients, and had raped a patient in his care), approved, 467 So. 2d 282 (Fla. 1985); Brown v. Tallahassee Democrat, Inc., 440 So. 2d 588 (Fla. 1st DCA 1983) (reversing trial court’s dismissal of plaintiff’s complaint that defendant published plaintiff’s photograph in a story about a murder in which the plaintiff was not involved but the juxtaposition of the photograph implied his association with the murder), and Gannett Co. v. Anderson, 947 So. 2d 1, 11 (Fla. 1st DCA 2006), approved in part, No. SC06-2174 (Fla. Oct. 23, 2008)(holding that false light should be governed by the same statute of limitations as defamation, and rejecting the assertion that only false light claims can be based on statements that are true).

As to the second point, the Court discussed the different standards applicable to the tort of false light versus defamation.

As the Restatement explains, it is “not . . . necessary to the action for invasion of privacy that the plaintiff be defamed. It is enough that he is given unreasonable and highly objectionable publicity that attributes to him characteristics, conduct or beliefs that are false, and so is placed before the public in a false position.” See Restatement (Second) of Torts § 652E cmt. b. For the tort of false light, the standard is whether the statement is highly offensive to a reasonable person. Id. § 652E(a). Conversely, a defamatory statement is one that tends to harm the reputation of another by lowering him or her in the estimation of the community or, more broadly stated, one that exposes a plaintiff to hatred, ridicule, or contempt or injures his business or reputation or occupation. Standard Jury Instructions—Civil Cases (No. 00-1), 795 So. 2d at 55.

For the court the critical issue boiled down to the fact that false light is defined in sujective terms versus defamation which is defined more objectively.

The court also raised First Amendment concerns. According to the Court, the false light “highly offensive to the reasonable person standard” raised a potential chilling effect on free speech because liability depended too much on subjective concerns of the plaintiff.

The Court rejected the suggestion that it could extend defamation protections to false light as other jurisdictions have done, but determined that this should be left to the legislature. The Court also noted in a parting shot that no case has been identified where a claim based solely on false light was upheld, which signaled to the Court that the tort was irrelevant.

Finally, the Court held that the applicable standard in defamation cases is the Restatement standard that the defamatory statement prejudices the plaintiff in the eyes of a “substantial and respectable minority” of the community.

Thus, it appears that in future, plaintiffs who would normally claim false light must plead a claim for implied defamation and meet the applicable standard for the communication at issue.

See also, PROTECTING THE MEDIA’S FIRST AMENDMENT RIGHTS IN FLORIDA: MAKING FALSE LIGHT PLAINTIFFS PLAY BY DEFAMATION RULES, 35 Stetson L. Rev. 227 (2006).

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