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Los Angeles Business Law Blog

Trademark battle divides famous family

Families in California and across the country may face conflicts when business and even intellectual property enter the picture. In one case, relatives of Phyllis Schlafly, the well-known late conservative activist, failed to block a brewery owned by a relative from trademarking their surname. A panel of the U.S. Federal Circuit Court of Appeals ruled unanimously in favor of Saint Louis Brewing LLC, co-founded by a nephew of Schlafly. He applied in 2011 to trademark his last name for his Schlafly-branded beer.

One judge said in the ruling that through the sales of beer under the Schlafly name, it had acquired a distinctive, secondary meaning. Once that point has been reached, it is possible to trademark a surname. Between 2009 and 2014, sales of Schlafly beer reached 74.8 million bottles, cans and servings on draft. The brewery began selling beer under the name in 1991. Despite the growing popularity of the beer, other members of the family intervened in an attempt to block the trademark. Phyllis Schlafly and her son claimed that the trademark could injure their reputations by associating them with alcohol despite being well-known for their conservative politics.

Counterfeit goods sold online are on the rise

Knockoffs of popular luxury brands typically appear in cruise ports and with vendors on busy city streets. Where else can you get a $1,200 purse for $100? These days, these same phony products are making their way online in large communities such as Amazon and eBay.

What can a company do if they come across phony products? One fashion powerhouse recently won a case against fake goods.

Girl Scouts accuse Boy Scouts of trademark infringement

California residents may be aware that the Boy Scouts of America started admitting girls in 2017, but they may not know that this decision has sparked a contentious legal dispute with the Girl Scouts of the United States of America. In a federal lawsuit filed in New York on Nov. 6, GSUSA alleges that BSA's branding of some of its offerings as "Scouting" and "Scouts"infringes on its trademarks in a way that damages its brand and confuses the public.

The trademark infringement litigation claims that BSA's rebranding will lead parents to believe that the services offered by GSUSA are not officially sanctioned scouting programs. The two organizations are not related but have coexisted amicably for more than 100 years. Unlike more conventional organizations, both BSA and GSUSA have congressional charters and the terms "Boy Scouts" and "Girl Scouts" are protected by special trademark laws.

USPTO warns of third parties hacking trademark applications

Creators in California rely on registration of patents and trademarks through the U.S. Patent and Trademark Office to establish their ownership of valuable intellectual property. Stakeholders often use the Trademark Electronic Application System to send in their applications, but a small portion of active applications and registrations have been compromised. The USPTO has issued an alert to warn people about entities making unauthorized changes to applications and registrations. Their goal appears to be switching registration to third-party brand registries.

The alert informed people to pay close attention to emails from the agency. All changes to electronic records trigger automated emails. Stakeholders should carefully check all such correspondence to confirm whether the change was authorized or not.

Mylan prevails in pharmaceutical patent dispute

Multiple sclerosis patients in California and across the country have watched an intellectual property dispute play out in the pharmaceutical arena that could have a major influence on the price of a key drug in MS treatment. Copaxone, patented by Teva Pharmaceuticals, is one of the most widely prescribed treatments for relapsing multiple sclerosis. From August 2017 to 2018, $2.86 billion in 40 mg/mL doses were sold as well as $527 million in 20 mg/mL doses.

Mylan, partnered with the Indian pharmaceutical firm Natco, filed for Food and Drug Administration approval of its own injections of glatiramer acetate, generic versions of Copaxone, and they won approval for their drugs in October 2017. While 20 mg/mL generic versions have been available in the United States for several years, Teva held on to a dosing patent for the 40 mg/mL version of the drug. Mylan and Natco's generic was the first to challenge Teva's grip on that dose. Patent infringement litigation followed Mylan's decision to enter the market, and it began to launch the drug even as the lawsuit continued.

"Black Vogue" in trademark infringement dispute

Even small, independent businesses in California could face trademark infringement lawsuits from major corporations. In one such case, Vogue, the famous fashion magazine owned by Advance Publications, has filed a lawsuit for trademark infringement against a 26-year-old designer and activist who created a line of shirts and other items bearing the words "Black Vogue" in a similar font to the magazine's famous header.

The designer filed a trademark application for "Black Vogue", but it was rejected because it was too similar to the existing trademarks for the magazine. According to Advance Publications' lawsuit, the company contacted the designer when it learned about the trademark application, requesting that she stop pursuing it. After her refusal, the company also sent a demand letter, telling her to stop selling the t-shirts, sweatshirts and other items bearing the "Black Vogue" insignia.

How to prevent wage and hour lawsuits

Litigation is an inevitable part of business, but how much so depends in part on how proactive you are in preventing cause for lawsuits. One of the highest sources of claims is employees, and an increasingly growing reason for suing is over wage and hour violations.

This cost businesses over $270 million in 2017, reports the Wage and Hour Division of the U.S. Department of Labor. Paying back wages is costlier than paying employees deserved wages, so avoid getting into this situation by taking the following preventive measures.

Wage and hour claims: How can employers protect themselves?

It is critical for both employers and employees to be aware of what constitutes wage theft. For example, plenty of employers try to get out of paying overtime. California has strict laws on what accounts for overtime, so business owners need to make sure they do not inadvertently run afoul of the law. 

Occasionally, employees will bring up baseless allegations of unpaid labor. Employees may falsely claim that they deserve overtime or received less than minimum wage. To resolve any of these issues, there are several steps all employers should take to ward off these kinds of unwarranted accusations. 

Heaven Hill distillery sues manufacturer of Heaven's Door whiskey

Music fans in California will likely recognize the song "Knockin' on Heaven's Door" by Bob Dylan. This famous tune inspired the name of the Heaven's Door brand of whiskey, which debuted this year in collaboration with the famous songwriter. However, the name has also inspired a trademark infringement lawsuit. Heaven Hill, a large distillery, filed a complaint in federal court because the whiskey producer considers the name and logo of Heaven's Door whiskey confusingly similar to its brand.

This legal action accompanied a cease-and-desist letter issued by Heaven Hill to Heaven's Door Spirits, LLC. In the view of the management at Heaven Hill, the similarities of the stacked logos for the whiskey brands would impede consumers' ability to distinguish between the two products. Heaven Hill has used its name since 1937, but Heaven's Door only launched its whiskeys this year.

Judge rejects Disney's claim of trademark infringement

Disney is finding it more difficult than anticipated to sue third parties that allegedly violate the use of its trademarked characters at birthday parties. The California-based entertainment company lost a summary judgement against a company in New York that sent characters with names like "The Princess," "The Duck" and "Big Harry Guy" to birthday parties. Disney claims the characters are meant to trick customers into thinking they are well-known trademarked property.

The New York federal judge who refused to rule in favor of Disney claimed that the birthday party characters didn't infringe on the company's trademark rights because there wasn't adequate evidence of competition or confusion. Children may believe that they are seeing an actual Disney character, but since adults are the ones paying for the services, it's only their perception that counts.

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