Following Hasbro's announcement in May that it would create a Center for Excellence for Hasbro Games in Rhode Island, Hasbro disclosed today that it will locate the Center in Providence. The site will be the former Blue Cross and Blue Shield of Rhode Island building in LaSalle Square, which has been empty since Blue Cross relocated to its new headquarters in 2009. The goal of the Center is to bring top games talent together with the Hasbro brand teams, to improve the experience for traditional board games and also for video, digital and online gaming. The new Center will be only a couple of blocks away from the new headquarters of 38studios, so there is the potential for synergies between the two companies and the talent they attract.
Separately, Hasbro announced today that it will be relocating 59 employees in Rhode Island as a result of creating the Center. Hasbro also stated that it recorded $13.1 million of pretax expense for severance relocation and related costs for the three months ending June 30, 2011, and anticipates an additional $7 million in costs over the next 3 to 4 quarters.
Update to provide additional coverage:
Boston Globe
Providence Journal
Providence Business News
Tuesday, July 19, 2011
Friday, July 15, 2011
Angry Birds Take On Counterfeit Pigs
Rovio Mobile Oy v. Ideal Toys Direct Inc., No. 11-CIV-4773 (Complaint Filed July 11, 2011).
We often discuss with clients the importance of multiple layers of intellectual property protection. Take, for example, a video game. The title can be protected under trademark law, and the trademark can be registered with the U.S. Patent and Trademark Office and its counterparts throughout the word. If there are characters that are important, the names and images can be similarly protected under trademark law, and the visual appearances of the characters are protected under copyright law. U.S. copyright law also provides additional benefits in litigation if the copyright is registered before any infringement or unlawful copying takes place. Original music and videos can also be protected under copyright law.
Multiple layers of protection provide advantages and options when it comes to enforcing the trademark rights. For example, if a character is protected under both trademark and copyright law, a copyright claim might be more successful in litigation. To prove infringement, one just has to demonstrate that the protected work and the infringing work are "substantially similar." No intent to copy, or customer confusion need to be shown. If the copyright is registered before the infringement takes place, one does not even have to demonstrate damages. The federal Copyright Act permits the court to award "statutory damages" in an amount of $750 to $30,000 per infringed work (or up to $150,000 per work if the court determines the copying is willful). Unlike the trademark law, which permits the court to award attorneys fees to the prevailing party only in "exceptional" cases, the Copyright Act provides that a court may award attorneys fees to the "prevailing party". So it is often preferable and more efficient to pursue a copyright claim in the right circumstances.
A complaint filed earlier this week by the owners of the intellectual property rights in the "Angry Birds" video game provides a good illustration of this. Rovio Mobile Oy, the developer of the Angry Birds video game, owns a U.S. trademark registration for its ANGRY BIRDS trademark. Rovio also owns several U.S. copyright registrations covering the pig, bird and eagle characters. Rovio's complaint claims that Ideal Toys's "Roly-Poly Birds" stuffed toys infringe Rovio's copyrights, and constitutes passing off and unfair competition under Section 43 (a) of the Lanham Act. In addition to injunctive relief, the complaint seeks statutory damages, destruction of the infringing products, and attorneys' fees under the Copyright Act and an award of the defendants' profits and attorneys' fees under the Lanham Act.
The Complaint appears to have Ideal Toys on the run. Time will tell whether Ideal Toys has any valid defenses.
Multiple layers of protection provide advantages and options when it comes to enforcing the trademark rights. For example, if a character is protected under both trademark and copyright law, a copyright claim might be more successful in litigation. To prove infringement, one just has to demonstrate that the protected work and the infringing work are "substantially similar." No intent to copy, or customer confusion need to be shown. If the copyright is registered before the infringement takes place, one does not even have to demonstrate damages. The federal Copyright Act permits the court to award "statutory damages" in an amount of $750 to $30,000 per infringed work (or up to $150,000 per work if the court determines the copying is willful). Unlike the trademark law, which permits the court to award attorneys fees to the prevailing party only in "exceptional" cases, the Copyright Act provides that a court may award attorneys fees to the "prevailing party". So it is often preferable and more efficient to pursue a copyright claim in the right circumstances.
A complaint filed earlier this week by the owners of the intellectual property rights in the "Angry Birds" video game provides a good illustration of this. Rovio Mobile Oy, the developer of the Angry Birds video game, owns a U.S. trademark registration for its ANGRY BIRDS trademark. Rovio also owns several U.S. copyright registrations covering the pig, bird and eagle characters. Rovio's complaint claims that Ideal Toys's "Roly-Poly Birds" stuffed toys infringe Rovio's copyrights, and constitutes passing off and unfair competition under Section 43 (a) of the Lanham Act. In addition to injunctive relief, the complaint seeks statutory damages, destruction of the infringing products, and attorneys' fees under the Copyright Act and an award of the defendants' profits and attorneys' fees under the Lanham Act.
The Complaint appears to have Ideal Toys on the run. Time will tell whether Ideal Toys has any valid defenses.
Friday, July 8, 2011
First Circuit: Rejection of Settlement Offer Does Not Cut off Plaintiff's Entitlement to Award of Attorneys Fees in Copyright Infringement Suit
Spooner v. EEN, Inc., No. 10-2393 (1st Cir. July 5, 2011) [link]
On Tuesday the First Circuit Court of Appeals issued a useful reminder to those negotiating settlements of lawsuits in federal court. If a plaintiff rejects an offer of judgment pursuant to Rule 68 of the Rules of Civil Procedure, and does not achieve a better result at trial, the plaintiff cannot expect to recover any attorneys' fees incurred after the rejection. However, if the plaintiff rejects "a garden-variety settlement offer," the plaintiff's entitlement to fees is not cut off.
In his complaint, Mr. Spooner alleged that the defendants infringed his copyright in a musical composition by using the music without authorization in television and Internet advertisements. Apparently, the litigation was hotly contested ("What followed was the litigation equivalent of hand-to-hand combat."). The defendants made a Rule 68 offer of judgment of $10,000, which was rejected. The defendants later made a $20,000 settlement offer, but not under Rule 68, which was also rejected. After trial, Mr. Spooner prevailed. The court awarded him injunctive relief, $40,000 in statutory damages, and $98,745.80 in attorneys fees as the "prevailing party" pursuant to Section 505 of the Copyright Act. (which authorizes a district court "in its discretion" to "award a reasonable attorney's fee to the prevailing party" in a copyright action.).
On appeal, the defendants argued that the fee award was so excessive that the district court should not have awarded any fees at all, and that, even if an award was warranted, the court should have limited it to work performed prior to the date that the second settlement offer was rejected.
The First Circuit rejected both arguments. With respect to the attorneys fees incurred after the rejection of the settlement offer, the First Circuit explained that there is a significant difference between the conseqences of rejecting a Rule 68 offer of judgment and the consequences of rejecting a 'garden variety" settlement offer. Rule 68 provides a framework that allows a defendant to make a firm, non-negotiable offer of judgment, which the plaintiff can reject or accept. If the plaintiff rejects a Rule 68 offer, and and does not improve upon the offer at trial, then the plaintiff is obligated to pay the defense costs and attorneys' fees incurred after the rejection. But, the Court pointed out, a settlement offer made without resort to Rule 68 does not accrue the same benefits, and the rejection of a settlement offer does not work to cut off the plaintiff's entitlement of fees.
The First Circuit also found the award of attorneys fees was not excessive.
As a result, defendants proposing settlement offers in copyright cases must be careful to consider Rule 68 and to determine whether or not to make the offer of judgment pursuant to Rule 68. If the settlement offer is made without the protection of Rule 68, then the offer does not act to cut off the plaintiff's right to request attorney's fees incurred after the rejection under the Copyright Act, even if the plaintiff does not improve his position at trial.
On Tuesday the First Circuit Court of Appeals issued a useful reminder to those negotiating settlements of lawsuits in federal court. If a plaintiff rejects an offer of judgment pursuant to Rule 68 of the Rules of Civil Procedure, and does not achieve a better result at trial, the plaintiff cannot expect to recover any attorneys' fees incurred after the rejection. However, if the plaintiff rejects "a garden-variety settlement offer," the plaintiff's entitlement to fees is not cut off.
In his complaint, Mr. Spooner alleged that the defendants infringed his copyright in a musical composition by using the music without authorization in television and Internet advertisements. Apparently, the litigation was hotly contested ("What followed was the litigation equivalent of hand-to-hand combat."). The defendants made a Rule 68 offer of judgment of $10,000, which was rejected. The defendants later made a $20,000 settlement offer, but not under Rule 68, which was also rejected. After trial, Mr. Spooner prevailed. The court awarded him injunctive relief, $40,000 in statutory damages, and $98,745.80 in attorneys fees as the "prevailing party" pursuant to Section 505 of the Copyright Act. (which authorizes a district court "in its discretion" to "award a reasonable attorney's fee to the prevailing party" in a copyright action.).
On appeal, the defendants argued that the fee award was so excessive that the district court should not have awarded any fees at all, and that, even if an award was warranted, the court should have limited it to work performed prior to the date that the second settlement offer was rejected.
The First Circuit rejected both arguments. With respect to the attorneys fees incurred after the rejection of the settlement offer, the First Circuit explained that there is a significant difference between the conseqences of rejecting a Rule 68 offer of judgment and the consequences of rejecting a 'garden variety" settlement offer. Rule 68 provides a framework that allows a defendant to make a firm, non-negotiable offer of judgment, which the plaintiff can reject or accept. If the plaintiff rejects a Rule 68 offer, and and does not improve upon the offer at trial, then the plaintiff is obligated to pay the defense costs and attorneys' fees incurred after the rejection. But, the Court pointed out, a settlement offer made without resort to Rule 68 does not accrue the same benefits, and the rejection of a settlement offer does not work to cut off the plaintiff's entitlement of fees.
The First Circuit also found the award of attorneys fees was not excessive.
As a result, defendants proposing settlement offers in copyright cases must be careful to consider Rule 68 and to determine whether or not to make the offer of judgment pursuant to Rule 68. If the settlement offer is made without the protection of Rule 68, then the offer does not act to cut off the plaintiff's right to request attorney's fees incurred after the rejection under the Copyright Act, even if the plaintiff does not improve his position at trial.
Tuesday, July 5, 2011
Will the Real DJ Paulie/DJ Pauly D, Please Stand Up, Please Stand Up?
Lis v. Delvecchio, No. 3:11-CV-01057-AWT (D. Conn. filed June 30, 2011).
Mr. Paul Lis, a Connecticut man who claims to have used the name “DJ PAULIE” since 1973 as a disc jockey, has filed a complaint for trademark infringement in federal court in Connecticut against Rhode Island resident Paul DelVecchio Jr, more popularly known as “DJ Pauly D” on the MTV Network show “Jersey Shore.” The complaint also names 495 Productions, the producer of the television show, MTV Networks, the Palms Casino Resort in Las Vegas, Room 960, a nightclub in Hartford, Baskin-Robbins and Hearst Publications, as additional defendants.
The complaint alleges claims for federal trademark infringement, federal trademark dilution, federal unfair competition, state unfair competition, and violation of the Connecticut Unfair Trade Practices Act. No specific dollar amount for damages is specified in the complaint, which also seeks injunctive relief, punitive damages and attorneys fees.
Obviously, more facts will need to be developed before the claims can be properly analyzed. But at the outset, the claims for federal trademark dilution, and for injunctive relief, may be in trouble.
Federal law allows the owner of a "famous mark" to enjoin a person from using "a mark or trade name in commerce that is likely to cause dilution by blurring or dilution by tarnishment of the famous mark.” To succeed on his federal dilution claim, then, Mr. Lis has the burden of proof to show: (1) that he owns a “famous” mark; (2) that the defendants are making use of the mark in commerce; (3) that Mr. Delvecchio adopted his mark after Mr. Lis’s mark became famous; and (4) that Mr. Delvecchio’s mark is likely to cause dilution by blurring or dilution by tarnishment of Mr. Lis’s famous mark.
Here, Mr. Lis’s complaint alleges dilution by tarnishment by claiming that the “Jersey Shore” television show follows “a group of young adults pursuing a debauched lifestyle suggestive of loose morals, violence, intoxication and liberal profanity – the exact opposite” of the good reputation Mr. Lis purportedly has spent decades building up. The problem is that Mr. Lis is likely to have trouble showing that he owns a “famous” mark. Under federal law, a mark is famous if it is widely recognized by the general consuming public of the United States as a designation of source of the goods or services of the mark’s owner. Can Mr. Lis really prove that his “DJ PAULIE” brand is “widely recognized by the general consuming public in the United States.” If not, then his dilution claim is likely to fail.
Mr. Lis also may face a problem in seeking injunctive relief, at least before a trial. The complaint alleges that Mr. Lis’s attorneys first contacted Viacom about the issue in early 2010. Most courts require a showing of “likelihood of success on the merits” and of “irreparable harm” in order to obtain preliminary injunctive relief before the trial. Leaving aside the case on the merits, it will be difficult for Mr. Lis to argue he has been “irreparably harmed” and requires relief prior to trial where he and his attorneys have waited nearly 18 months to pursue their claims in court.
Most lawsuits of this nature settle at some point, and this one probably will settle, also. If not, look for a trial in a couple of years over who is the “real DJ Paulie (Pauly) D.”
Mr. Paul Lis, a Connecticut man who claims to have used the name “DJ PAULIE” since 1973 as a disc jockey, has filed a complaint for trademark infringement in federal court in Connecticut against Rhode Island resident Paul DelVecchio Jr, more popularly known as “DJ Pauly D” on the MTV Network show “Jersey Shore.” The complaint also names 495 Productions, the producer of the television show, MTV Networks, the Palms Casino Resort in Las Vegas, Room 960, a nightclub in Hartford, Baskin-Robbins and Hearst Publications, as additional defendants.
The complaint alleges claims for federal trademark infringement, federal trademark dilution, federal unfair competition, state unfair competition, and violation of the Connecticut Unfair Trade Practices Act. No specific dollar amount for damages is specified in the complaint, which also seeks injunctive relief, punitive damages and attorneys fees.
Obviously, more facts will need to be developed before the claims can be properly analyzed. But at the outset, the claims for federal trademark dilution, and for injunctive relief, may be in trouble.
Federal law allows the owner of a "famous mark" to enjoin a person from using "a mark or trade name in commerce that is likely to cause dilution by blurring or dilution by tarnishment of the famous mark.” To succeed on his federal dilution claim, then, Mr. Lis has the burden of proof to show: (1) that he owns a “famous” mark; (2) that the defendants are making use of the mark in commerce; (3) that Mr. Delvecchio adopted his mark after Mr. Lis’s mark became famous; and (4) that Mr. Delvecchio’s mark is likely to cause dilution by blurring or dilution by tarnishment of Mr. Lis’s famous mark.
Here, Mr. Lis’s complaint alleges dilution by tarnishment by claiming that the “Jersey Shore” television show follows “a group of young adults pursuing a debauched lifestyle suggestive of loose morals, violence, intoxication and liberal profanity – the exact opposite” of the good reputation Mr. Lis purportedly has spent decades building up. The problem is that Mr. Lis is likely to have trouble showing that he owns a “famous” mark. Under federal law, a mark is famous if it is widely recognized by the general consuming public of the United States as a designation of source of the goods or services of the mark’s owner. Can Mr. Lis really prove that his “DJ PAULIE” brand is “widely recognized by the general consuming public in the United States.” If not, then his dilution claim is likely to fail.
Mr. Lis also may face a problem in seeking injunctive relief, at least before a trial. The complaint alleges that Mr. Lis’s attorneys first contacted Viacom about the issue in early 2010. Most courts require a showing of “likelihood of success on the merits” and of “irreparable harm” in order to obtain preliminary injunctive relief before the trial. Leaving aside the case on the merits, it will be difficult for Mr. Lis to argue he has been “irreparably harmed” and requires relief prior to trial where he and his attorneys have waited nearly 18 months to pursue their claims in court.
Most lawsuits of this nature settle at some point, and this one probably will settle, also. If not, look for a trial in a couple of years over who is the “real DJ Paulie (Pauly) D.”
Friday, July 1, 2011
June 2011 IP Cases Filed in US District Court of Rhode Island
There were only 2 new intellectual property (patent, trademark and copyright) case filings in June 2011 at the U.S. District Court for Rhode Island. This brings the total to 9 new IP case filings (3 patent and 6 trademark) for the year to date, which is a 10% decrease over the same period in 2010.
The new cases in June include one design patent infringement case and one trademark infringement case. So far there have been no new copyright cases filed in 2011 in Rhode Island.
These numbers only include cases that have been designated in the court's database as a patent, trademark or copyright case. There are other cases pending where the complaint may include trademark or other intellectual property claims. But unless the case is designated as such, we are not counting it here.
The new cases in June include one design patent infringement case and one trademark infringement case. So far there have been no new copyright cases filed in 2011 in Rhode Island.
These numbers only include cases that have been designated in the court's database as a patent, trademark or copyright case. There are other cases pending where the complaint may include trademark or other intellectual property claims. But unless the case is designated as such, we are not counting it here.
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