20 November, 2014

One Taste to Rule Them All - Can You Trademark a Flavor?

Tastes and preferences are as varied and as complex as there are people, yet some distinct combinations truly are above everything else (should you take this writer's word as gospel - which you shouldn't): basil and tomato; chocolate and chili; milk and tea - the list goes on and on. With that in mind, a distinct and successful flavor combination can be the ticket to prosperity for a lot of restaurants or food-related businesses, and locking that combination down quite valuable as well. Although recipes were discussed on this blog in more depth not too long ago, a recent case has emerged dealing with the question that's on everyone's lips: can you trademark a flavor?

The case involving the flavor-fight was New York Pizzeria Inc. v Syal, in which the subject matter near-and-dear to many New Yorkers' hearts (i.e. arteries), pizza, was disputed. New York Pizzeria, a franchising company for pizzerias, brought this lawsuit against their former employee, Adrian Hembree (although against his alleged co-conspirator, Ravinder Syal), who had acted as the company's Vice-President and as a franchisee in its restaurant business. Mr. Hembree's term of employment was ended, and he subsequently went on to found a competing chain of restaurants; Gina's Italian Kitchen. Mr. Hembree had brought a lawsuit against NYPI for an alleged breach of his termination agreement, after which NYPI took on Mr. Hembree for alleged acquisition and transference of internal documents and recipes to Gina's in order to create a knock-off restaurant. Further, NYPI asserted that Mr. Hembree had gained access to NYPI's internal network through another franchisee's account, passing the details onto Mr. Syal, who then downloaded internal documents from said network. The case discussed the matter quite broadly, as many different counts were alleged by NYPI, of which only a few relate to the question posed above.

The beef of the intellectual property argument by NYPI is brought under 15 USC section 1125, as NYPI claim that the defendant infringed its trademark in the flavor of its food, and the trade dress of its goods as to the food's plating. Should a flavor be considered a possible trademark, under section 1125 Mr. Syal could face a civil action for the infringement of that trademark or its possible dilution.

Great flavors can lead to unpleasant results, no matter how delicious
As was seen in Qualitex v Jacobson Products, discussed by Justice Costa in the case at hand, a trademark can potentially be "...almost anything at all that is capable of carrying meaning" - even a flavor, at least prima facie, as long as it indicates a source for the goods: "[T]he essence of a protected mark is its capacity to distinguish a product and identify its source". If a flavor can be so distinct and so unique that it indicates an origin which is undoubtedly a single restaurant or creator, you could argue it is within the remit of trademark protection in the US. Realistically this would be very unlikely, but entertains an interesting thought. Arguably flavors would never reach the requisite secondary meaning, i.e. an impression in the minds of the public as to the origin of a specific good, due to the very vague and hard to pin-point nature of flavors as a whole. Several pizza sauces, for example, even if very different in their composition, will all still taste very similar, albeit with small (or large) differences to them, thus not carrying much of an indication as to the sauce's origin restaurant.

The final nail in the coffin of flavor trademarks is the inability to trademark something which is purely functional. Functionality was seen in Qualitex, to encompass "...[which] is essential to the use or purpose of the article or if it affects the cost or quality of the article,' that is, if exclusive use of the feature would put competitors at a significant non-reputation-related disadvantage". Limiting the usability of flavor combinations, especially iconic ones such as pizza sauce, would clearly hinder competition, or even extinguish it entirely within the field of pizza making. As said, this was put to rest in Re N.V. Organon, where the US Trademark Trial and Appeal Board saw that "[flavoring] performs a utilitarian function that cannot be monopolized without hindering competition". In the end Justice Costa dismissed the argument of flavor trademarks.

Justice Costa didn't discuss the plating issue in much depth, as arguing a specific plating as trade dress is very unorthodox, but entertained the thought nonetheless. NYPI claimed that its plating of its baked ziti, eggplant Parmesan and chicken Parmesan carried a distinctive look, warranting protection. NYPI failed to express what they were protecting in the plating of the dishes, and how they were infringed, failing their argument quite early on: "[i]n the trade dress context, a plaintiff must articulate the elements that comprise its protected trade dress in order for the court to evaluate the plausibility of its claim". In the end, as said above, the claim failed due to a lack of demonstration on NYPI's part, but Justice Costa thought the argument could have warranted more discussion: "...NYPI knows how it plates its food, and it could have easily identified what is distinctive about the plating that might warrant trade dress protection".

Similar views have been expressed here in the UK, with an application for a "Taste of Artificial Strawberries" failing to pass the threshold of trademarkability due to its lack of distinctiveness. This echoes US precedent, and arguably would be the right decision in light of the law and public interest in the non-restriction of flavors in the marketplace. In this writer's opinion the future of flavor trademarks seems very grim, but as a connoisseur of all things culinary, I am quite glad that the world of food isn't shackled by commercial interests; at least not unduly.

Source: JDSupra

13 November, 2014

Generic Stuff - Food Packaging and Intellectual Property Law

Remembering back fondly to ones childhood often elicits images of Saturday mornings, watching cartoons and eating cereal poured from colorful cereal boxes. Yet a shadows of this memory is when your parents buy the generic brand, often simply grabbing something from a store shelf thinking it's the brand that their child loves, missing the folly in their ignorance and disappointing their young ones with less flavorful alternatives to their desired sugary morning treats. Thinking back, the disappointment probably was not as palpable as my memory serves me, but this illustrates a point of contention in intellectual property law; how close can you brand your foodstuffs as a generic brand when compared to more popular variants of a given food item? The goodwill and reputation, which many food manufacturers strive for for years, even decades, often seems easily exploited in the sphere of food packaging, yet, at least prima facie, their goodwill and make-up should potentially be well within the sphere of intellectual property law, and therefore quite protectable. The extent of this protection merits further discussion, especially in today's highly competitive world within the shopping jungle of grocery stores.

What prompted this writer's interest in this topic was an article published on the IPKat (originally brought up in an article on Yahoo! News), which discussed the seemingly blatant copying of popular brand items by Aldi in their store brand equivalents, especially in the remit of chips sold in a tubular container, and the mentioned use of similar packaging in cereals. Could Aldi's practices infringe on the brands' rights in the UK or abroad?

Some protection could be offered by copyright, should the packaging contain a work which can be categorized as protectable under the subject matter. Images on packaging, or even more stylistic or intricate designs, could potentially be considered an artistic work under the Copyright, Designs and Patents Act 1988 (and similar laws abroad), and even the writing used on the box (stories, challenges and other items on the back for example). The image has to have no artistic merit to it for it to be protected, but still has to be considered original. Although not the primary avenue for protecting packaging, it can still address the issue at a much shallower level. Arguably most goods will not infringe on copyright, even if they resemble the name brand goods quite a lot, as you would have to make a copy of the work (in simplistic terms), and a mere imitation might not be enough to argue copyright infringement, as a box for foodstuffs would be a long-shot to argue as a form of expression worth protecting.

Trademarks, under the Trademarks Act 1994 (and other similar provisions), are the more 'obvious' choice when it comes to protecting your brands, and certain foodstuffs are covered under the subject matter such as the name "Pringles" or "Froot Loops". Primarily trademarks only assist in the protection of names and logos (such as Captain Rik), and as such are much weaker when the logo, name or other trademark isn't directly copied or a similar variant used. Clearly, should Aldi (or any other business) deviate from those, they would arguably be in the clear.

The darker side of store brands: underpaid mascots
As for design rights, unregistered designs under the Copyright, Designs and Patents Act 1988  protect the shape or configuration of a good; i.e. how it looks like form wise, and not in terms of it's 'get-up'. This would be hard for Aldi (or others) to infringe unless a good has a very specific shape to it, such as a triangle box in stead of the typical box design. Under the registered designs regime through the Registered Designs Act 1949, a design can be registered should the appearance in part or as a whole have a specific look to it, including colors, shapes and even textures. The design has to have individual character, which can be simply said to entail something which is unique to that product, and isn't too generic, while also having to be novel. Arguably this is the hurdle where most foodstuff packaging stumbles in registered designs, as it would be nearly impossible to say that merely a certain color scheme or variation thereof would be novel and individual to that particular item. This in mind it is very possible for generic brands to imitate the look of a cereal box, even if the color scheme would be very identifiable for that particular brand.

In the US there is the concept of what is often referred to as 'trade dress', which is protected under 15 USC section 1125, making it quite usable in this instance, although not in a UK context. Under the Act a product can infringe upon the trade dress of another product under certain circumstances: "[If it] is likely to cause confusion, or to cause mistake, or to deceive as to the affiliation, connection, or association of such person with another person, or as to the origin, sponsorship, or approval of his or her goods, services, or commercial activities by another person, or... in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person’s goods, services, or commercial activities". Arguably this would be very hard to prove, at least prima facie, but should a brand take the time and effort to compile sufficient evidence as to likely confusion and detriment on their end, trade dress could be a useful tool in the area of consumer goods. In the UK an avenue functioning much akin to the US provision above would be passing off (discussed more in depth on this very blog here); however the threshold of proof required is very hard to overcome, especially in an instance where the passing off isn't obvious and clear.

As one can see the world of consumer goods and foodstuffs is a treacherous and difficult area of law in which to wage your battles, and arguably most brand owners will not benefit in fighting this fight. Superior quality, goodwill and marketing will serve a better purpose than paying your lawyers to take on Aldi for its generic items; however as a legal professional it is a bit of a no-no to admit this. One can still appreciate the impact of generic goods and confusion related to them, with studies indicating that consumers are very likely to buy store brand products when they look like the name brand item, and a relatively high percentage of purchases having been mistakes due to the similarities. In the end this would be a matter which would have to be addressed by the legislature, but in a competitive world having choice and a cheaper option can still be good for business and the consumer - just not necessarily the brand owner.

06 November, 2014

Fake Goods and the Internet - ISPs Face Trademarks

Counterfeit products are big business. Some estimates have put the sale of counterfeit items at a billion dollars in 2013, and anyone who has traveled around mainland Europe has probably seen people sell "authentic" designer bags off pieces of carpet on the street (and who doesn't like purchasing their luxury goods in the great outdoors). The only issue with selling blatantly on the street is the sheer visibility of your transactions, with the added issue of a very limited quantity of items for sale. The more genius members of the business have since moved onto the World Wide Web, pushing their goods to the willing masses on the great waves of the Internet. The law hasn't fully adapted to this change, with a clear difference in the protection of so-called intangible counterfeit goods (piracy etc.) and more physical objects and their intangible attributes such as trademarks. Amidst this uncertainty the protectability of trademarks in this space was brought up in the English courts, and has since been taken on by the UK Court of Appeal.

The case in question was Cartier International AG v British Sky Broadcasting Ltd, which dealt with the company Richemont, which owns several luxury brands such as Cartier and IWC. As Richemont's goods are highly sought after and quite valuable, six websites were started, aimed at selling and advertising goods using Richemont's trademarks in doing so. The website's donned such fantastic domains as www.cartierloveonline.com and www.iwcwatchtop.com, clearly aimed to confuse and befuddle those who are less savvy on the information super highway. As such Richemont wanted to halt the websites' operations, and approached the courts to impose an injunction to block the websites.

What remains the bigger question in this case is whether such a block is possible under the current law, or as was framed by Justice Arnold: "First, does this Court have jurisdiction to make an order of the kind sought? Secondly, if the Court has jurisdiction, what are the threshold conditions, if any, which must be satisfied if the Court is to make an order? Thirdly, are those conditions satisfied in the present case? Fourthly, if those conditions are satisfied, what are the principles to be applied in deciding whether or not to make such an order? Fifthly, applying those principles, should such orders be made in the present case?"

Under section 97A of the Copyright, Designs and Patents Act 1988 the courts can impose an injunction against an Internet service provider; however the issue presented to the court is that under section 97A the courts can impose an injunction only "...where that service provider has actual knowledge of another person using their service to infringe copyright". As such there was no issue of copyright infringement in the case, as only Richemont's trademarks had been potentially infringed, and no provision allowing for injunctions in the event of trademarks being infringed exists in the UK.

The Court of Appeal's message to trademark infringers
This lead to some extreme juggling of current laws and whether such an injunction was possible bar an express mention of such a power, although this was meant to have been implemented by the UK under the Information Society Directive. Justice Arnold was faced to examine whether this omission was supplemented under section 37 of the Senior Courts Act 1981, through which "[t]he High Court may by order (whether interlocutory or final) grant an injunction or appoint a receiver in all cases in which it appears to the court to be just and convenient to do so". Agreeing with precedent, Justice Arnold saw that an injunction under section 37 of the 1981 Act would not contravene the Supreme Court Act 1981, allowing for the High Court to afford the injunction as a final decision should it do so.

Justice Arnold discussed the conditions which have to be fulfilled before a court may award the aforementioned injunction: "First, the ISPs must be intermediaries within the meaning of the third sentence of Article 11 [of the IPR Enforcement Directive]. Secondly, either the users and/or the operators of the website must be infringing the claimant's trade marks. Thirdly, the users and/or the operators of the website must use the ISPs' services to do that. Fourthly, the ISPs must have actual knowledge of this. Each of the first three conditions follows from the wording of Article 11 itself.".

Applying the conditions to the case Justice Arnold quickly saw that all of the requirements had been fulfilled. First, British Sky and the other ISPs acting as defendants can be said to be intermediaries within the meaning of the Directive without much question. Second, as Richemont owns the rights to several infringed trademarks in the case, such as Cartier, IWC and Montblanc, used in in the six websites dealt with in the case, the websites clearly infringed on those rights. Third, due to the ISPs role as intermediaries, although are not prima facie used for the infringement directly, because of their integral role in the conveyance of the infringement to Internet uses they are used for the infringement, irrespective of a contractual relation between the infringer and the ISPs. Finally, through evidence it was easy for Richemont to establish that the ISPs did indeed have actual knowledge of this infringement and chose not to act on it. Because of this the requirements are fulfilled, and Justice Arnold could award the injunction.

The case can be said to be very important in a UK perspective, and potentially as an international precedent. Through the decision rights holders have a remedy to address the infringement of their rights outside of just copyrights online, potentially allowing the curbing of counterfeit sales online (although this writer will admit it seems like a long-shot it would be ever fully eradicated). Nevertheless, this remedy can be argued to have been needed, and in the absence of intervention by the legislature, should stand as an avenue for trademark enforcement on the Web.

Source: World Trademark Review