United States: Three Point Shot - Summer 2020

The buzzer sounded for former University of Maryland basketball players Jaylen Brantley and Jared Nickens ("Plaintiffs") when a Maryland district court dismissed all eight IP-related claims the dancing duo brought against Epic Games, Inc. ("Epic") regarding its use of a virtual dance move in its popular video game Fortnite that was purportedly similar to the "Running Man" dance the pair hyped up online. (Brantley v. Epic Games, Inc., No. 19-00594 (D. Md. May 29, 2020)). After bringing the dance to viral fame on The Ellen Degeneres Show in April 2016, the players claimed Epic's game Fortnite profited off of their intellectual property by selling a similar dance feature within the game. Unfortunately for the Plaintiffs, the judge did not think it was such a slam dunk.

In their original complaint, filed in February 2019, Plaintiffs argued that Fortnite unlawfully capitalized on the "Running Man" dance "created, named and/or popularized" by the Plaintiffs and offered it for purchase in an otherwise free video game. In its decision, the court noted that the Plaintiffs had previously stated on The Ellen Degeneres Show clip that two high school students actually created the dance, but that Plaintiffs made the dance explode in popularity via their social media platforms and by doing the dance at games and practices. The "Running Man" dance is one of many purchasable features in the game, called an "emote." Emotes allow a player's avatar to celebrate on the virtual battlefield-their availability has a significant role in the game's popularity and commercial success. In essence, Plaintiffs claim that the "Running Man" dance was their property, and that Epic appropriated it for use in Fortnite without permission or requesting a license to use their likenesses. In all, after amending their Complaint in March 2019 to remove claims of copyright infringement, Plaintiffs advanced various claims, including right of publicity, unjust enrichment, and a host of trademark-related claims.

In May 2019, Epic went on a fast break and moved to dismiss the complaint. Among other things, Epic argued that Plaintiffs' non-trademark claims were preempted by the Copyright Act and their trademark-related claims should be dismissed for a lack of a registered mark and because the game maker has First Amendment rights in the expressive elements of its video games. Plaintiffs countered that their claims contained an extra element that placed them outside of copyright preemption, that they possess right of publicity claims in their characteristic dance under various state publicity laws or under common law and that Epic`s use of the dance was not transformative to justify its alleged misappropriation.

Unfortunately for the Plaintiffs, their argument turned out to be an air ball. In its May 2020 opinion dismissing the complaint, the court began by noting that the Copyright Act preempts a wide range of claims that fall within the subject matter of copyright ("The scope of copyright preemption is broader than the scope of copyright protection"). To determine if the Copyright Act preempts Plaintiffs' various claims, the court applied a two-prong test: (1) the work must be within the scope of the subject matter of copyright, and (2) the rights granted under state law must be equivalent to the rights within the scope of the federal Copyright Act. As the court stated, because the Copyright Act specifically lists choreographic works, the "Running Man" dance fit into the first prong like a ball swishing the net. Though not all dances qualify as protected copyrighted works, the court noted that the question of copyright preemption is a broader one than that of copyright protection, and that

the dance fell within this larger framework ("In short, the "Running Man" is somewhere on the continuum between copyrightable choreography and uncopyrightable dance"). The second prong states that the rights to be preempted must be equivalent to the rights protected by the Copyright Act. Here, the court held that because the rights the players are seeking to protect are also protected by the Copyright Act - namely, that Plaintiffs brought common law claims based on alleged unauthorized copying of "Running Man" and that Epic's alleged "capturing and digitally copying" of the "Running Man" dance to create the virtual Fortnite emote was "squarely within the rights protected by the Copyright Act." Plaintiffs' trademark-related claims for unfair competition and false designation of origin were similarly precluded, or "Dastar-ed," that is, dismissed under the Supreme Court`s Dastar precedent because the allegations were properly the subject of copyright, not Lanham Act protection. The court also dismissed Plaintiff's trademark infringement and dilution claims for failure to allege a valid trademark.

Despite Brantley and Nickens's attempts to claim Fortnite committed a technical foul, the clock ran out in this one-sided contest, with little hope for a rematch, at least in this court. In granting Epic's dismissal motion, the court held that because Plaintiffs have already been given previous opportunities to cure the deficiencies in their pleadings and had already filed an amended complaint, the claims were dismissed with prejudice. Thus, barring an appeal, there will likely be no runaround on the "Running Man" decision. This also likely means that the Plaintiffs will have to be satisfied with their online fame and the benefits that flow from such exposure. In the future, if Fortnite chooses to create new emotes inspired by the next dance craze, it`s a good bet there will be many to choose from, given the number of memes and viral videos that come and go on social media.

If you do not know the phrase JUST DO IT, you are doing something wrong. The three word, all-capital-letter mark is touted by Nike, Inc. ("Nike") to be "one of the most famous and recognizable marks of the 20^th and 21^st centuries." Not only can the slogan be seen across social media platforms, but it also has been featured globally alongside top-notch athletes. So, when a couple of upstarts tried to register a mark for athletic apparel that was confusingly similar to Nike`s famous JUST DO IT mark, they quickly discovered that perhaps next time they shouldn't.

Nike claims that it has used the slogan JUST DO IT in commerce since at least 1989 and cited a trademark for clothing and sweatshirts bearing the slogan registered in 1995 (JUST DO IT has since been registered for other classes of goods over the ensuing years). Given the mark's designed ambiguity (as the word "It" can really mean anything), JUST DO IT has become synonymous with competitive sports ideas like "excellence on the field" and "giving 110%" and has shaped the Nike brand into what it is today. It, therefore, was not surprising when Nike quickly opposed an application to register JUST DREW IT! with the USPTO.

The application for the proposed JUST DREW IT! mark was filed by Jamin Caldwell and Courtney Miles ("Applicants"). The Applicants sought to register their JUST DREW IT! mark for use on Class 25 clothing items, which includes athletic apparel, that purportedly would contain original artwork under the campaign of JUST DREW IT!. The mark was published for opposition in December 2017.

Subsequently, Nike filed a notice of opposition in April 2018. In its notice, Nike cited prior instances where the Trademark Trial and Appeal Board ("TTAB") had upheld prior challenges to other "JUST ___ IT" marks and raised several grounds as to why the Applicants' proposed registration should be refused. Nike relied on Section 2(d) of the federal Lanham Act to claim the Applicants' mark would cause confusion with Nike's JUST DO IT mark and Section 43(c) to allege the Applicants' mark would dilute, by way of blurring, Nike's famous slogan. For both of these claims, Nike relied on its longtime, continuous use of its famous mark.

Under the Lanham Act, the USPTO may refuse to register any mark if it is likely to confuse, mistake, or deceive consumers as to the commercial source of the goods or dilute the distinctiveness of a famous mark. See 15 U.S.C. § 1052(d); 15 U.S.C. § 1125(c)(2)(B). To determine the former, a multifactor test is applied using

the "DuPont Factors," which are then weighed against one another to determine whether there is a likelihood of confusion. The DuPont Factors include, among others, the fame of the registered mark, the degree of similarity of the marks, the nature of the goods using the marks, the channels of trade, the classes of consumers, and the purchasing conditions of the goods. In this instance, the TTAB focused on three factors: the similarity of the marks, the similarity of the goods, and the similarity of the trade channels. Likewise, the analysis for dilution considers multiple factors, including the fame and distinctiveness of the existing mark, the timing of the existing mark's fame, and the degree to which a new mark will be used in commerce and dilute, by blurring, the famous registered mark.

At the outset, the Applicants admitted Nike's JUST DO IT mark is famous within the meaning of Section 43(c) of the Lanham Act for dilution purposes and became famous prior to the filing of their own trademark application. Thus, Nike came ready to play and started with a big advantage. In its opening brief filed in September 2019, Nike argued the Applicants' proposed mark-which begins and ends with the same word, with a similar-sounding word in the middle-was confusingly similar to its own famous mark and by using JUST DREW IT! on comparable goods, the Applicants were trying to create an unauthorized association with Nike.

Motivated to succeed, Nike did not stop there. It further argued the Applicant's registration also created a likelihood of dilution. Dilution by "blurring" may occur where an entity uses or modifies the plaintiff's trademark to identify the entity`s goods and services, raising the potential that the mark will lose its ability to serve as a unique identifier of the plaintiff's product. In its argument against registration of the JUST DREW IT! mark on these grounds, Nike referred to many of the same points outlined in its likelihood of confusion analysis and relied on the Applicants' concessions of the fame of the JUST DO IT mark and Nike`s efforts to vigorously protect diluting uses of its mark.

In October 2019, Applicants attempted to put up a fight by filing a pro se brief in support of JUST DREW IT!. After acknowledging JUST DO IT is a famous mark and has been in use since the late 1980s, the Applicants attempted to argue Nike's mark lacked distinctiveness because it is not "fanciful." Moreover, Applicants attempted to distinguish their mark by highlighting the difference between the second words "DO" and "DREW" and the exclamation point used at the end of their mark.

In April 2020, the TTAB delivered an opinion in favor of Nike's opposition petition. (Nike, Inc. v. Caldwell, No. 91240394 (TTAB Apr. 28, 2020) (non-precedential)). The Board found Nike was successful in establishing, by a preponderance of the evidence, the Applicants' mark would likely cause confusion with and dilute Nike's "exceedingly" famous JUST DO IT mark. It found the relevant DuPont Factors weighed in Nike's favor-the marks are confusingly similar and the goods and trade channels identical. The Board also found, among other things, the exclamation point in the Applicants' proposed mark did not help distinguish the marks, and while the words DO and DREW look different, their meanings and sound are "not necessarily significantly different." Regarding dilution, the TTAB stated JUST DO IT enjoys the "highest level of fame" and "broadest scope of protection," which weighs in favor of finding a likelihood of dilution. As a result, the Board sustained Nike's opposition on confusion and dilution grounds and directed that the Applicants' mark be refused.

With no further appeals following the ruling, Applicants were deemed to have abandoned their application this past July.

This decision favoring Nike is only the most recent of many; Nike claims the corporation has successfully enforced its trademark rights against dozens of marks and applications over the years. With another clever "JUST ___ IT" spinoff likely to surface in the near future, stay tuned to see whether or not Nike will remain undefeated and continue to JUST DO IT.

When he looks back, 2014 must have seemed like a hopeful time for plaintiff Zachary Smith ("Smith"). Feeling lucky and hoping to win some free drinks, the Missouri resident signed up for a raffle at the popular social spot No Other Pub. He had no idea the Kansas City sports bar would become such a royal pain.

In his complaint filed in March 2019, Smith alleged that for several years after visiting the popular pub in KC's Power & Light District, No Other Pub bombarded him with promotional texts and calls in violation of the Telephone Consumer Protection Act ("TCPA"). Smith teamed up with co-plaintiff Brian Kagarice ("Kagarice"), who made similar allegations-though he claimed he had never set foot in the bar, much less provided his mobile phone number (it isn't clear if his presence in the bar's marketing system was the result of a typo or a mischievous acquaintance). Attempting to build out their roster even further, Smith and Kagarice asked the Court to certify a class of similarly-situated spam sufferers. Finally and separately, Smith and Kagarice claimed that, because they had registered their mobile phone numbers on the National Do Not Call Registry, the bar's unsolicited calls violated the Federal Trade Commission's Telemarketing Sales Rule (the "Do-Not-Call Rule"). In 2019, both parties moved for summary judgment.

For the most part, the April 2020 ruling on the summary judgment motions (Smith v. Truman Rd. Development, LLC, No. 18-00670 (W.D. Mo. Apr. 28, 2020)) was a big night for No Other Pub. First, the court balked at Smith and Kagarice's claim regarding the allegedly unsolicited text messages. The TCPA prohibits using an automated telephone dialing system ("ATDS") to make non-emergency calls or texts without the prior express consent of the recipient. The TCPA defines an ATDS as "equipment which has the capacity-(A) to store or produce telephone numbers to be called, using a random or sequential number generator; and (B) to dial such numbers." 47 U.S.C. §227(a)(1). The meaning of this definition has generated much litigation in recent years; in any particular case, courts generally examine whether the messaging platform at issue falls within the scope of an ATDS.

No Other Pub urged the court to read the definition of ATDS narrowly, arguing that they weren't using such a system because their messaging software was incapable of generating random or sequential phone numbers. The pub also pointed out that its employees manually entered the numbers from a sign-up sheet into its marketing database and that an employee had to log into the system, select the groups of names to receive a specific promotion, and then send the message (as opposed to a fully automated pitch). Here, the court faced a splitter: Some circuit courts, such as the Ninth Circuit, have broadly interpreted the term "capacity" in the TCPA, holding that a device that stores telephone numbers-whether or not those numbers have been generated by a random or sequential number generator-can still be an ATDS. But other circuits have taken a narrower view (Missouri's circuit, the Eighth, apparently hasn't weighed in). Yet, the pub seemed to have home field advantage, as the court pointed to three other District Courts within the Eighth Circuit that supported a narrow reading. Thus, the judge in this case also applied a narrow interpretation of an ATDS, finding that "the best reading of the plain text of the ATDS definition indicates that a system must include a random or sequential number generator." As a result, the court granted summary judgment in favor of the pub on Smith and Kagarice's TCPA "autodialer" claim. Strike one for the plaintiffs.

With the TCPA claim thrown out, Smith and Kagarice's attempt at a class action never had a chance-the Court tossed their class certification as well. Strike two for the plaintiffs.

The plaintiffs had one last argument on tap: their Do-Not-Call claim. Smith and Kagarice claimed that the pub violated 47 C.F.R. § 64.1200(c), which prohibits "telephone solicitations" to residential telephone subscribers who are registered on the National Do Not Call Registry. Among other things, the TCPA provides a private right of action for individuals who have received more than one telephone call within any twelve-month period in violation of these regulations (see 47 U.S.C. §227(c)(5)), but a potential recipient's "established business relationship" with the defendant is an affirmative defense to such a claim.

The court addressed this claim one plaintiff at a time, and it soon became clear why: It turned out Smith had responded favorably to some of No Other Pub's texts, and even wet his whistle there as recently as 2017. This was enough for the court to rule that he and the bar had an established business relationship, clearing the tab on Smith's Do-Not-Call claim. Strike three; Smith's suit was out.

The established business relationship defense that took down Smith wouldn't get past Kagarice, however, since he claimed to have never visited No Other Pub. But the bar had one more shot in its arsenal. They argued that Kagarice, who regularly used his personal cell phone for work, could not properly register the number on the Registry because of a Do Not Call Rule requirement that registered numbers be "residential," not business lines. With Smith out and Kagarice down to his last strike, this residential-versus-business question was too close for the court to call: The judge denied summary judgement to either party and left the "question of fact" to a jury.

According to the parties' latest status conference in June 2020, the pub will be bringing a further motion to dismiss the remaining claim or else the matter will proceed to trial. As it stood, things were looking bleak for Smith and Kagarice on their TCPA claim, but recently the Supreme Court stepped in with a potential game changer: SCOTUS announced that it would review a dispute that is expected to produce a ruling clarifying the definition of "autodialer" under the TCPA. Depending on how the Justices rule on the ATDS issue, Smith, Kagarice and No Other Pub may go into extra innings. Pull up a bar stool and stay tuned.

It's the annual office retreat and it's finally your turn to tell two truths and one lie (your favorite icebreaker game). While it might be fun to break the ice at an office retreat, for a cruise ship, breaking the ice on the skating rink may lead to a sizeable verdict.

The slippery slope of events began with an incident in June 2016, in which Edgardo Lebron ("Plaintiff"), a passenger onboard Royal Caribbean's Adventure of the Sea ("Defendant" or "Royal Caribbean") cruise ship, fell and suffered a broken ankle while skating on the ship's ice rink. He was taken to sick bay and then by air to a hospital in Antigua, which set his ankle. He then had surgery back home in Puerto Rico. But, the plaintiff's ordeal merely cracked the surface of the future events that would occur.

As we previously relayed in the February 2019 edition of Three Point Shot, the plaintiff alleged that the defendant's negligence regarding the condition of the ice and skating equipment caused his injuries. In the complaint, the plaintiff asserted that Royal Caribbean was negligent for its employees' failure to properly inspect and maintain both the ice rink and the ice skates that it provided to the ship's passengers. Specifically, the plaintiff claimed that one of the ice skates he was given had a broken lace and, thus, could not be laced to the top and that the surface of the ice in the rink had gouges in it, which should have been noticed by crewmembers, and which caused plaintiff to fall. In short, the plaintiff claimed that the defendant's negligence with regard to the condition of the ice and skating equipment caused the plaintiff's injuries while ice skating onboard. Unable to reach a resolution, on September 25, 2018, both parties decided to test the waters of a jury trial. Initially, it appeared that Royal Caribbean was on thin ice, as the jury entered a nearly $667,000 verdict against the company. But, once the fog cleared, it was apparent that Royal Caribbean was not the only party at fault, as the jury found that the plaintiff was 35% responsible, thus reducing the damages payable by Royal Caribbean.

However, the jury's verdict was just the tip of the iceberg as there was more to this maritime tort suit than initially thought. Ruling on defendant's motion for a directed verdict, the Florida district court held that while there was sufficient evidence that Royal Caribbean knew or should have known about the defective skates, there was "not sufficient evidence for a jury to find that the defendant knew or should have known about the gouges in the ice that, together with the broken skate lace, created the dangerous condition." [emphasis added]. Therefore, the trial judge overturned the jury verdict, stating the plaintiff had presented insufficient evidence for a reasonable jury to infer that Royal Caribbean had actual or constructive notice of the unsafe ice conditions that caused plaintiff's fall. (Lebron v. Royal Caribbean Cruises, Ltd., No. 16-24687 (S.D. Fla. Dec. 18, 2018)).

But, change was on the horizon, as the Eleventh Circuit did not give high scores on the lower court's post-verdict routine. Taking points off concerning the lower court's fundamentals, the appeals court held that jury verdict should be reinstated because the plaintiff had adequately proven negligence concerning Royal Caribbean's maintenance of the ice and its negligence regarding the broken lace on the plaintiff's skate (Lebron v. Royal Caribbean Cruises, Ltd., No. 19-10115 (11th Cir. June 19, 2020)).

In examining the question about whether Royal Caribbean should have known about the condition of the ice before the fall, the appeals court cited testimony from the plaintiff's 12-year-old daughter, who had noticed the gouges and flakiness in the ice 10 to 15 minutes before the plaintiff fell. Coupled with evidence that several crewmembers were present at the rink - one of whom was responsible for "watching the ice" - the court noted that since an "an inexperienced skater, noticed the gouges, it goes without saying that trained employees responsible for 'watching the ice' should notice them." Thus, the appeals court reversed the lower court's directed verdict and found that plaintiff had presented sufficient evidence to prevail on both theories of negligence-that Royal Caribbean negligently maintained the ice and negligently provided plaintiff a skate with a broken lace. As the court put it: "[W]hile the evidence supporting notice of the unsafe ice conditions is by no means overwhelming, it is more than sufficient to support the jury's verdict."

This double axel of litigation resulted in the appeals court reinstating the jury's 2018 verdict (as adjusted for the parties' representative fault) and stopping Royal Caribbean from skating from the negligence claims. For now, it appears the parties have finally reached more settled shores.

In the April 2017 edition of Three Point Shot, we covered a dispute between Italian sportswear company Lotto Sport Italia ("Lotto Sport") and an online gambling operator, David Dent ("Dent"). After Lotto Sport prevailed in a UDPR proceeding regarding Dent's registration of the domain names (lottostore.com) and (lottoworks.com), Dent filed a declaratory judgment action in Arizona district court seeking a ruling that his domain name registrations (which were purportedly done in contemplation of future gambling-related ventures) were lawful under the Lanham Act and that Lotto Sport engaged in reverse domain name hijacking under the Anticybersquatting Consumer Protection Act (ACPA). In March 2020, a magistrate judge ruled that, as a matter of law, Dent did not unlawfully register or use the disputed domain names (and also stated that Dent did not use them in bad faith, even though the domains had resolved to parking pages strewn with paid advertisements, an action the court found was controlled by the registrar, not Dent). (Dent v. Lotto Sport Italia SpA, No. 17-00651 (D. Ariz. Mar. 10, 2020)). Because Dent had not used the disputed domain names in commerce, the court also ruled that Dent had not violated the Lanham Act as a matter of law. Days later, Lotto Sport appealed the ruling to the Ninth Circuit. Meanwhile, in July 2020, the parties filed dueling briefs over Dent's motion for attorney fees under the Lanham Act and ACPA. Thus, this hard-fought match appears far from over.

Three Point Shot - Summer 2020

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.