As people become more aware of these questionable practices, there has been increasing consumer demand for organic food.  In order to capitalize on this demand, U.S. farmers and major food companies have applied for “USDA Organic” certification.  Michelle Traher, USDA Organic Certification for the Innovative Farmer, 19 J. Contemp. Legal Issues 254, 254 (2006).  Without this certification, companies and farmers cannot label their products as organic or organically produced.  Id.

To get certified, a producer must meet the requirements of the National Organic Program.  The NOP has certain standards for what substances may be used in the production of food.  For example, the use of synthetic substances and ingredients (with certain exceptions), ionizing radiation, or sewage sludge in the production and handling of food items is prohibited.

Although the NOP is good in that it provides central regulation over the marketing of organic products, the “USDA Organic” label can mislead the average consumer in several ways.  First, many consumers are likely unaware that there are four levels of organic certification.  When 100% of the ingredients and methods used to produce the food are organic, the item can be labeled “100% organic.”  When at least 95% of the ingredients are organic, the item can be labeled “organic.”   When at least 70% off the ingredients used are organic, the item can be labeled “made with organic.”  And items with less than 70% organic ingredients cannot carry the mark, but specific organic ingredients can be identified as such.  Thus, consumers may buy a product labeled “organic,” assuming that it is completely organic, when only a certain ingredient meets the NOP qualifications.

Second, the list of nonorganic ingredients allowed in certified organic food products is more extensive than the average consumer likely realizes.  One permitted nonorganic ingredient is carrageenan, a thickening agent derived from seaweed that has been linked to such health problems as gastrointestinal inflammation and colon cancer.  Another ingredient is cellulose, or wood pulp, which is used as a thickener and filler.  Many consumers are unaware of these additives and buy products with the “USDA Organic” label, assuming they are healthy and natural.

Third, many consumers do not realize that there is a certification fee.  Smaller, family-owned farms, which may employ food cultivation methods that are better both for consumers’ health and the environment, often cannot afford certification and thus have a difficult time competing with larger companies.  These large companies are the ones most likely to use potentially harmful additives in their products, but because they can afford the “USDA Organic” sticker, their products are more appealing to consumers.

One could argue that despite the misperceptions the “USDA Organic” label may create, companies that use the label cannot be accused of false advertising since they meet the requirements of the NOP.  One might further argue that it is the responsibility of the consumer to inform himself about the nature of his purchases.  However, this seems to go against the spirit of trademark law, which is designed to protect consumers, including those who many not have the time or means to fully research every item they purchase, from being deceived about the source or nature of goods in the marketplace.  Thus, the Lanham Act, which sets out a federal registration scheme for federal trademarks and service marks, provides that anyone who uses false or misleading representations of fact to sell a good or service in the marketplace may be subject to civil liability.

The “USDA Organic” label is certainly misleading.  Well-meaning consumers pay more for certified organic products, expecting them to be devoid of harmful ingredients.  However, “no Lanham Act jurisprudence has allowed consumers by themselves, or accompanied by the state, to have standing for a false advertising claim. The Lanham Act protects consumers peripherally, through competitor actions.”  Christopher T. Jones, The Manic Organic Panic: First Amendment Freedoms and Farming or the Attack of the Agriculture Appropriations Rider, 26 J. Land Resources & Envt’l. L. 423, 443-44.  Thus, a competitor in the organic industry would have to bring the false advertising claim.  Unfortunately, it is unlikely that a big organic corporation will bring a claim against a fellow corporation because the current USDA certification system is beneficial to the larger organic producers.  Smaller organic farmers who may be willing to bring such a claim may not have the resources to take on a large corporation.

But perhaps in the future a court will choose to allow individual consumers to bring a false advertising claim.  Or perhaps a small organic farm will decide to challenge the questionable practices of certified organic producers.  Either way, there needs to be a change in the current organic certification system.  The NOP regulations must be stricter, or the labeling on certified organic products should be clearer.  Consumers are purposefully paying more for what they are led to believe is healthier, and the companies benefiting from this should be obligated to meet their customers’ expectations.

• Chief U.S. District Judge Vaughn Walker in San Francisco decided to allow showing the trial challenging California’s Proposition 8 on YouTube, reports the San Francisco Chronicle.  The Wall Street Journal Law Blog questions whether that’s a good thing.

• Patent Librarian notes that Wikipedia citations in patent applications are up 59%, but Patently-O puts that increase in perspective.

• A report commissioned by the French government recommends taxing Google on their online advertising revenues in France to help fund legal outlets to buy media hurt by online piracy, reports the Mercury News.  President Sarkozy supports the measure, says PC World.

• The Wall Street Journal reports that Philip K. Dick’s estate claims Google infringed on its intellectual property by using the name “Nexus One” for the new Google-branded phone.  It brings to mind this recent post by Seth Godin.

• The Electronic Frontier Foundation responds to Bono’s recent New York Times Op-Ed, in which the musician / global icon lamented media piracy and suggested digital tracking be used to help criminal enforcement.

• Law.com provides an insightful guide to mining web 2.0 as a source of evidence.

• The Colorado Department of Transportation created an iPhone app to tell users if they’re too drunk to drive, the latest in a series of state efforts “to reach out to the Twitter-iPhone-Facebook generation,” according to the Wall Street Journal.

• The Ninth Circuit Court of Appeals affirmed [decision, pdf] a district court ruling that tasers should only be used in limited circumstances, as they pose a greater threat to their targets than other non-lethal police weapons.  The San Jose Mercury News reports on the suit that originated from a city police officer using a stun gun on a San Jose State student.

• Broadcom agreed to settle the securities fraud class action against it, says the Wall Street Journal Law Blog.

• The L.A. Times reports that the California Science Center has been sued for canceling a showing of film attacking Darwinian evolution and promoting intelligent design.

• Blizzard helps police make a drug arrest of a suspect tracked by his World of Warcraft account, posts kokomo perspective.

Twitter usernames are valuable

Twitter, created in 2006, is one of the fastest growing web sites in the world, and is among the top fifty most popular sites as ranked by Alexa. Users can post updates (or “tweets”) of up to 140 characters. Many celebrities and corporations now use Twitter to give their followers information about their daily activities, photographs from events, or links to web pages.

On Twitter, the username doubles as a web address. For example, the user “donttrythis” (Adam Savage, co-host of the Discovery Channel show “Mythbusters”) can be found at Twitter.com/donttrythis. As with domain names, short and readily-identifiable names are preferred.

With the rapid growth in traffic to the site, corporations have been staking their claims to Twitter usernames. But before many corporations could gain control of the Twitter username that corresponds to their brand name, individuals registered them – for example, Twitter.com/nike. Many bloggers, lawyers and non-lawyers alike, began warning corporations to protect themselves from this so-called “Twittersquatting.”   Without the protection of a statute analogous to the Anti-Cybersquatting Consumer Protection Act, trademark owners are left at the mercy of Twitter to determine how to assign, suspend, and reassign usernames.

Corporations are becoming more aware of their presence on Twitter

In January 2009, attorney and engineer Erik J. Heels wrote a blog post discussing the failure of an overwhelming majority of the top 100 brands in securing their brand name on Twitter. Incredibly valuable brands such as Coca-Cola, McDonald’s, Microsoft, IBM, Marlboro, and many others did not control their brand name on Twitter.  While 97 of 100 had the internet domain name that corresponded to their brand name, only 7 of 100 had the Twitter username corresponding to their brand name. Mr. Heels recommended that social networking companies work together to create a uniform username dispute resolution policy (UUDRP) analogous to the Uniform Domain Name Dispute Resolution Policy.

As of this post, there is no UUDRP.

There has been, however, quite a change in the control of the top 100 brand names on Twitter. As of November 8, 2009, 28 of those top 100 brands control their brand name on Twitter. While this is still a minority of the top brands, it is a 400% increase from less than one year ago. So what has changed?

Twitter has changed its policies

On January 14, 2009, Twitter posted “The Twitter Rules” on its website. These rules explained more clearly Twitter’s policies on impersonation of persons or corporations, name squatting, and trademark usernames. Twitter also updated its Terms of Service on September 10, 2009 (with a subsequent update on September 18, 2009) incorporating the Twitter Rules as part of Twitter’s terms of service.

The differences between the old terms of service and the new terms of service (including the Twitter Rules) are significant. The old terms banned “illegal and unauthorized purpose[s],” and retained the right to “modify or terminate Twitter.com service for any reason, without notice,” and “reclaim usernames on behalf of businesses or individuals that hold legal claim or trademark on those usernames.” These terms did not explain when the rules would be enforced, nor the criteria Twitter would use to reach its decisions.

The new terms of service explain that “accounts that are inactive for more than six months may . . . be removed without further notice” and that “you will not . . . sell” Twitter usernames. These rules have been augmented over time by more detailed explanations of Twitter’s trademark policy, name squatting policy, and impersonation policy, as well as the methods for reporting violations of those rules.

The increased detail and clarity in Twitter’s rules have allowed corporations to know their rights, and have given them the means to enforce those rights through Twitter’s internal processes. They have suspended a half-dozen usernames from the top 100 brands, and another 14 usernames will be released if Twitter bulk-releases inactive accounts as it has said it plans to do.

Is it enough?

There is, however, room for improvement. Twitter currently does not have a stated remedy for squatters who register a valuable brand name, have been active within the last six months, but are not impersonating the corporation that owns the brand or attempting to sell the name. While Twitter reserves the right to reclaim these names, it would benefit users if Twitter posted a clear policy of when and under what conditions it will reclaim those usernames. To date, Twitter has avoided Twittersquatting-related litigation (one case settled after Twitter transferred ownership of the username), but it’s not clear that the new rules will fully satisfy trademark owners, or what courts will do if asked to resolve a Twittersquatting dispute.

By Kyle Barnett and Gavin Snyder.

Like a copyright, a trademark owner does not need to register a mark to receive some legal protection. However, registering the marks can have several advantages, which we’ll further discuss below. If a company decides to register their mark, it must submit an application, which includes demonstrating either that the trademark is currently in use, or that the company has a “bona fide intention” to use it.³ Once the United States Patent and Trademark Office receives the application and any required accompanying materials (and, of course, the requisite fees), an examining attorney will analyze it to and determine whether or not it is registerable.⁴

Maintaining trademark protection

Following the USPTO’s approval and the owner’s implementation of a trademark, there are continuing responsibilities placed upon an owner who wishes to maintain their trademark protection. If the mark is federally registered, the owner must periodically renew their registration by filing the appropriate paperwork (and paying the associated fee). This can be done by sending in the appropriate forms by mail or online at the USPTO’s website. Once registered, an owner is entitled to use the “®” symbol to designate his federal trademark. This alerts potential infringers to the fact that the mark is federally registered and can improve the owner’s chances of collecting infringement damages in court. If a mark is not federally registered, the owner may use the symbol “TM” (for a trademark) or “SM” (for a service mark); while an unregistered mark does not enjoy the same legal benefits as a federally registered trademark, it does remind potential infringers that the owner intends to enforce their legal rights.

In addition to registration and renewal, there are a number of other requirements for maintenance of a trademark. First, the mark must be in continuous commercial use. If the mark ceases to be used continuously, it is said to be “abandoned,” and protection of the mark is lost. (This point could be key for Cisco.) Second, the owner of the mark must maintain tight control over its use — this means that the owner must not allow others to use the mark. If the owner fails to take action against infringers, then the trademark can no longer serve as a reliable indicator that the product or service comes from a particular source, thus the mark is consequently considered abandoned. Accordingly, a trademark owner is expected to “police” the mark by monitoring publications such as the USPTO’s Official Gazette (a publication that lists newly applied-for trademarks and provides an opportunity for individuals to challenge the proposed registration) or periodically running full trademark searches.

If the owner of a mark discovers that someone else is using it, they should take immediate action to stop the infringement (e.g., writing a letter to the infringer or contacting a lawyer). Finally, a trademark can also be lost if the mark becomes “generic” through common usage. For example, the term Kleenex is often used to refer to facial tissue, and therefore, the branding of facial tissues as “Kleenex” is no longer trademark infringement. This “genericide” can be avoided by taking precautions such as accompanying the mark with the type of product or service (e.g., Kleenex tissues), capitalizing the mark, and/or avoiding use of the mark as a general noun for a type of product.

Rights and benefits conferred by registration

As noted above, registration of a trademark with the USPTO has several benefits. First, the territorial reach of a registered trademark is national, whereas an unregistered trademark is limited to the territory in which the mark is actually used⁵. Thus, the owner of a registered mark can prevent anyone from subsequently using a confusingly similar mark anywhere in the United States, even in those parts of the country in which the registrant does not use its mark. The owner of an unregistered mark, however, cannot prevent future use of even an identical mark in parts of the United States where the owner does not do business. Furthermore, a successful registration serves as constructive notice of the mark and its ownership to all future users of confusingly similar marks.⁶ Consequently, future users of confusingly similar marks cannot claim ignorance of the mark or its ownership in trademark infringement claims.

Second, the owner of a registered mark can prevent an existing user of a confusingly similar unregistered mark from expanding use of the unregistered mark beyond the territory in which it is already used. This can happen when two companies are using similar unregistered marks in two separate regions of the United States. Should neither party register, both companies can expand the territories in which they use their marks as long as there is no overlap. Once territories overlap, the first user in the overlapping territory has priority and can bring an infringement action. However, if one company registers its mark, it can prevent any further expansion by its rival, even into parts of the United States where neither company does business. This has the effect of freezing the territory of the unregistered rival at the moment of registration while preserving expansion opportunities for the registrant.

Third, a successful registration establishes a rebuttable presumption of a mark’s validity as a registered trademark.⁷ Basically this means that a court will assume, until proven otherwise, that the trademark registration is valid and enforceable. A common claim made against registered trademark owners is that their marks do not deserve the protections of registration because they are generic or descriptive and lack secondary meaning. A successful registration establishes a rebuttable presumption that the mark is neither generic nor merely descriptive and instead has secondary meaning, or is suggestive, arbitrary or fanciful. Thus, the burden is on the challenger to prove that the registration is invalid, rather than on the registrant to prove that the registration is valid.

Remedies available under the Lanham Act

The owner of a trademark, registered or not, has access to several different avenues of federal relief for infringement that may not be available when suing under state unfair competition laws. For example, federal law allows an owner to seek injunctive relief to prevent a competitor from using a confusingly similar mark on a similar product.⁸ See where we’re going?

Injunctive relief is often sought in cases, like the Apple / Cisco iPhone litigation, whereby one company announces its intentions to use a mark registered to someone else. The owner may seek a court order preventing the would-be infringer from going forward with its plans. Additionally, owners may seek monetary relief.⁹ Monetary relief can be in the form of an award of the infringer’s profits from using the registered mark, monetary damages (e.g., lost profits due to consumer confusion), and / or the cost of bringing the infringement action (e.g., attorneys’ fees). In addition, an owner may seek destruction of all materials in the infringer’s possession bearing the infringing mark.¹⁰ This would include all marketing materials and packaging.

Conclusion

We hope you’ve found our introduction to trademarks informative – and perhaps even interesting. Now that you have a little bit of background into trademark law, you’ll be ready to read our next STLR Engadget installment, which will focus squarely on the Apple/Cisco iPhone litigation. See you then!

Footnotes

¹ For general definitions, see 15 U.S.C. § 1127 here. The US Supreme Court suggested that a symbol could be “almost anything at all that is capable of carrying meaning.” Qualitex v. Jacobson Products, 514 U.S. 159, 162 (1995).

² See 15 U.S.C. §§ 1127 & 1053 here. The Supreme Court case Two Pesos v. Taco Cabana, 505 U.S. 763 (1992), discusses appearance, or “trade dress.”

³ See 15 U.S.C. § 1051 here. An intent-to-use application does not make the mark protected. A company may only enforce protections on their mark if it is actually used.
⁴ The application process can have several outcomes. If an application is refused, the applicant may amend, abandon, or appeal. The mark may also be subject to opposition or cancellation proceedings; see 15 U.S.C. §§1063-64 here.

⁵ See 15 U.S.C. § 1057(c) here.

⁶ See 15 U.S.C. § 1072 here.

⁷ See 15 U.S.C. § 1057(b) here.

⁸ See 15 U.S.C. § 1116 here.

⁹ See 15 U.S.C. § 1117 here.

¹⁰ See 15 U.S.C. § 1118 here.

Legal analysis by Sarah Calvert, Jason McInnes, and Scott McMillan, and edited by Trevor Adler and Jonathan Coronel. Reprinted from Engadget.