False Advertising Liability for Affiliate Marketing

The proliferation of e-commerce websites along with the rise of social media, blogging, and online communities has greatly increased the importance of affiliate marketing.  Affiliate marketing allows an affiliate to earn a commission by directing a customer to a company’s website to purchase a product.  Websites providing information, reviews, advice, and resources about particular types of products can earn substantial revenue by embedding affiliate links in webpages.  Affiliate marketers should be aware of a recent expansion in false advertising liability in the courts premised on negative reviews, rankings, and product comparisons.  Meanwhile, product manufacturers feeling aggrieved by statements made on product review websites now have a possible false advertising cause of action for seeking redress.

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Willfulness After Halo: Now What?

The general consensus is that the Supreme Court’s June decision in Halo Electronics v. Pulse Electronics eased the path to proving willfulness, as discussed previously on IP Litigation Current. Many speculated that one result of the Halo decision would be an increase in the value of patents, since a finding of willfulness may lead to trebling of damages.

While Halo did away with the objective prong of the willfulness inquiry, and also clarified that the requisite standard of proof for willfulness is a preponderance of the evidence as opposed to clear and convincing evidence, the question post-Halo has been: Now what? After all, the Supreme Court instructed that district courts “‘be guided by [the] sound legal principles’ developed over nearly two centuries of application and interpretation of the patent act.” Halo, 136 S. Ct. 1923, 1935 (2016) (quoting Martin v. Franklin Capital Corp., 546 U.S. 132, 136 (2005)). How have district courts have applied such guidance and legal principles post-Halo? Let’s have a look.

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Design Patents and Copyrights for Designs on Useful Articles

Two recent cases illustrate the potential benefits of protecting intellectual property rights with both design patents and copyrights, particularly for an article that has both utility and a design, including because a design patent infringement analysis may sometimes be more straightforward to apply. In a design patent case, Columbia Sportswear North America, Inc. v. Seirus Innovative Accessories, No. 3:15-cv-00064 (D. Or. Aug. 10, 2016), a court applied a clear-cut analysis in granting summary judgment of infringement of a design used for breathable heat-reflective material. In contrast, in a copyright case, Star Athletica, L.L.C. v. Varsity Brands, Inc., 136 S. Ct. 1823, No. 15-866, 2016 U.S. Lexis 3031 (2016), the Supreme Court has granted certiorari to examine the test of whether a feature of a useful article – such as a garment or piece of furniture – is conceptually separable from the article and thus protectable by copyright, which courts have consistently struggled with. Continue reading this entry

The Evolving Standard for Pleading Direct Patent Infringement

It has been a little more than half a year since the amendments to the Federal Rules of Civil Procedure abrogated Rule 84 and put an end to the Form 18 bare-bones style patent complaint.  The question on the minds of many patent litigators has been: What standard would emerge for pleading direct patent infringement in the post-Form 18 world?  The contours of the answer to that question have begun to emerge as many district courts are now requiring plaintiffs to allege sufficient facts to permit an inference that an accused product infringes each element of at least one patent claim.  Counsel for plaintiffs should take heed of this heightened pleading standard.  On the other side, counsel for defendants now have an additional tool in their toolbox for attacking bare-bones style patent complaints.

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The Supreme Court to Tackle Extraterritorial Reach of U.S. Patents

The Supreme Court recently granted certiorari in Life Techs. Corp. v. Promega Corp., 14-1538, to resolve: “[w]hether a supplier can be held liable for providing ‘all or a substantial portion of the components of a patented invention’ from the United States when the supplier ships for combination abroad only a single commodity component of a multi-component invention” under 35 U.S.C. § 271(f)(1).

Life Technologies (“LifeTech”) manufactures genetic testing kits containing: (1) a primer mix; (2) Taq polymerase; (3) PCR reaction mix including neucleotides; (4) a buffer solution; and (5) control DNA. Promega Corp. v. Life Techs. Corp., 773 F.3d 1338, 1344 (Fed. Cir. 2014). Promega licensed a patent on technology for replicating DNA which it then licensed to LifeTech for “Forensics and Human Identity Applications.” Id. In addition to “Forensics and Human Identity Applications,” LifeTech also sold kits for unlicensed purposes worldwide. Id. Notably, LifeTech manufactures Taq polymerase in the United States, which it then ships to another manufacturing plant in the UK, which manufactures the remaining kit components and assembles the kits. Id. Promega sued LifeTech in 2010 alleging infringement including those worldwide sales containing only one component from the U.S. (Taq). Id.

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