Articles Posted in Trademark

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EA has defeated Edge Games’ attempt to broadly assert rights in the word “EDGE” in connection with video games. Edge sued Electronic Arts for trademark infringement, alleging that EA’s use of “MIRROR’S EDGE” for video games infringed its trademark rights. EA countered that Dr. Langdell and Edge committed fraud on the USPTO by submitting false/doctored specimens of use and making false representations regarding use of its marks. The U.S. District Court for the Northern District of California denied Edge’s motion for a preliminary injunction, finding that all of Edge’s “representations regarding the validity and use of the asserted marks are infected by evidence of deceit.” Edge Games, Inc. v. Electronics Art, Inc., Civil Action No. c10-02614 WHA (N.D. Cal. October 1, 2010).

The case promptly and on October 10, 2010, the Court entered a Final Judgment (here) and an Order approving the parties’ stipulation regarding the disposition of the claims (here). In the Judgment, the Court ordered the USPTO to cancel five registrations owned by Edge. The Order required Edge to notify its licenses that the marks [sic] have been cancelled, and to provide them with a copy of the order denying Edge’s motion for preliminary injunction.

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gucci.jpgIn Gucci America, Inc. v. Frontline Processing Corp., No. 09 Civ. 6925 (HB) (S.D.N.Y. June 23, 2010), a New York court denied a motion to dismiss contributory trademark infringement claims brought against the defendant credit card processing companies by Gucci. The court held that credit card processing companies may be held liable for contributory trademark infringement under the relevant Supreme Court test. See Inwood Laboratories, Inc. v. Ives Laboratories, Inc., 456 U. S. 844 (1982).

The court held that defendants (and others) who provide service to websites that sell counterfeit goods can be liable if the plaintiff can show that they:

(1) intentionally induced the website to infringe through the sale of counterfeit goods; or (2) knowingly supplied services to websites and had sufficient control over infringing activity to merit liability.

The court’s decision relied on the “willful blindness” standard set forth in Tiffany v. eBay, 600 F.3d 93 (2d Cir. 2010) and distinguished the Ninth Circuit’s decision in Perfect 10, Inc. v. Visa Int’l Serv. Ass’n, 494 F.3d 788 (9th Cir. 2007) due to the fact that in this case, unlike in Perfect 10, the infringement relied on credit card services because the infringement was based on the sale of tangible counterfeit products.

This and other recent cases highlights the need for credit card companies and other payment providers to carefully assess the steps they can and should take to limit liability for trademark infringement and other liabilities.

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On April 8, 2010, Zynga sued Playerauctions.com for operating a website that provides an unauthorized “Secondary Market” for enabling Zynga game users to post and sell “Virtual Currency” and “Virtual Goods” allegedly in violation of Zynga’s Terms of Service. According to Zynga, its Terms of Service prohibits users from selling “Virtual Currency” or “Virtual Goods” for real-world money or anything of value outside of its games.

A recent version of the Zynga Terms of Service states:

The Service may include a virtual, in-game currency (“Virtual Currency”) including, but not limited to coins, cash, or points, that may be purchased from Zynga for “real world” money if you are a legal adult in your country of residence. The Service may also include virtual, in-game digital items (“Virtual Goods”) that may be purchased from Zynga for “real world” money or for Virtual Currency. Regardless of the terminology used, Virtual Currency and Virtual Goods may never be redeemed for “real world” money, goods or other items of monetary value from Zynga or any other party.

It further states:

Transfers of Virtual Currencies and Virtual Goods are strictly prohibited except where explicitly authorized within the Service. Outside of the game, you may not buy or sell any Virtual Currency or Virtual Goods for “real world” money or otherwise exchange items for value. Any attempt to do so is in violation of these Terms and may result in a lifetime ban from Zynga Service and possible legal action.

Zynga alleges that the Playerauctions.com has committed copyright and trademark infringement (along with false designation of origin, unfair competition and other claims) by displaying and/reproducing images and code from the games and using various Zynga trademarks with authorization.

The Complaint identifies unlawful sales in connection with Zynga’s Poker, Mafia Wars and FarmVille games. A recent review of the Playerauctions.com site showed over 750 Mafia Wars related items alone available for sale ranging in unit price from 25 cents to $900 and 84 entire “accounts” for sale ranging in asking price from $30 to $5,000 with one listed at a whopping $492,000!

Interestingly, Zynga does not specifically allege impropriety with or seek to prevent the outright sale of accounts.

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Florida A&M University (FAMU) recently filed a law suit against the maker of a porn video that depicted multiple individuals engaging in sexual acts in a setting that allegedly represented a dorm room on the FAMU campus. FAMU claims that such association constitutes false or misleading descriptions and misrepresentations under Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), federal trademark dilution under Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(c), disparagement and injury to business reputation and trademark dilution under Florida Statute § 495.151(2009), and common law trademark infringement under Florida law.

Although this suit does not relate directly to virtual worlds, we are writing about it because this type of fact pattern commonly occurs in virtual worlds where famous brands are used in seedy portions of virtual worlds. Like this case, such uses can be actionable to prevent brand disparagement and tarnishment and other harms.

FAMU claiims that the defendant used FAMU’s trademarks in the registered mark “FAMU”, its tradename, “Rattlers,” and its orange and green color scheme, which was chosen to represent Florida’s major industry (citrus). FAMU alleges that it has produced and sold merchandise bearing the “FAMU” mark since 1953 and the “Rattlers” mark since 1985.

The Complaint alleges that Defendant RK operates the website “daredorm.com,” which depicts individuals engaging in sexually explicit activities in what appears to be dorm rooms at various college campuses throughout the United States and charges a fee to internet consumers who wish to view the videos depicted on its “daredorm.com” website.

The Complaint alleges that on or about March 1, 2010, RK posted a full-length video entitled “BigRattler77” on its “daredorm.com” website depicting no less than eight (8) individuals engaging in multiple acts of sexual intercourse in what is intended to appear to be a FAMU dorm room, that the video contains several visual depictions of and oral references to the FAMU and “Rattlers” marks and depicts the orange and green color scheme in connection with the “FAMU” and “Rattlers” marks. The Complaint further alleges that the caption for the “BigRattler77″ video states that it was filmed ‘at a historically black college in Florida” and that the individuals were FAMU students and contains derogatory and highly offensive racial innuendo and visual depictions of gang signs purportedly associated with FAMU.

FAMU complains that “BigRattler77” is a transparent attempt to trade on the good name and identity of Florida Agricultural and Mechanical University and its marks by wrongly insinuating that its students routinely engage in the debasing and degrading behavior depicted therein, that it is likely to deceive, confuse and mislead prospective purchasers and viewers of the video into believing that the video was produced, authorized or is in some manner associated with FAMU.

FAMU seeks a preliminary and permanent injunction to prevent such use.

The caption of the case is Florida Agricultural & Mechanical University Board of Trustees v. RK Netmedia Inc. et al., No. 10-0100, complaint filed (N.D. Fla., Tallahassee Div. Mar. 16, 2010).