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Prince is a practitioner of what has come to be known as “appropriation art,” that is, art – mainly visual art – that incorporates and utilizes third-party images and photographs, which are often the subject of copyright.

In 2008, Prince created thirty works of art that comprised a series he called Canal Zone. The works in Canal Zone made use of a number of images from Patrick Cariou’s photography book on Rastafarians in Jamaica called “Yes Rasta”. In the Canal Zone works, Prince had enlarged, cut up, and painted over Cariou’s images, as well as placed them with other images. While not directly a factor in the Court’s infringement analysis but certainly a motivating factor behind Cariou’s lawsuit, while Cariou had little commercial success with his book, Yes Rasta, Prince sold eight of the Canal Zone works for a total of over $10 million.

Cariou initially won on summary judgment at the district court level, and obtained a permanent injunction compelling Prince to turn over all of the unsold Canal Zone works for sale, disposal or destruction. In its ruling, the United States District Court for the Southern District of New York held that Prince’s works did not qualify as a “fair use” because, among other things, they were not transformative in that they did not “comment on” Cariou’s photographs or the subjects of the photographs, and Prince himself did not articulate any transformative intent in connection with the use of the images.

On appeal, Prince challenged the lower court’s analysis of the first fair use factor, the purpose and character of the use. The purpose of this factor is to test whether the allegedly infringing work is “transformative”. A work is transformative when it adds something new to the work allegedly infringed, with a further purpose or different character, altering the original work with new expression, meaning, or message. A work is transformative if it does something more than repackage or republish the original copyrighted work. A transformative work is one that serves a new and different function from the original work and is not a substitute for it. As the Supreme Court noted in Campbell v. Acuff-Rose Music, Inc., “the more transformative the new work, the less will be the significance of other factors, … that may weigh against a finding of fair use.”

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A U.S. patent is “presumed” valid. That means a patent owner does not need to prove the patent is valid in a suit for infringement. And, as the U.S. Supreme Court just explained in Commil United States, LLC v. Cisco Systems, Inc., 2015 U.S. LEXIS 3406 (May 26, 2015), a defendant’s belief that the patent is invalid is not a defense to infringement.

Commil owned a patent that covered a method for increasing the speed of wireless networks. Commil sued Cisco for patent infringement, alleging that Cisco directly infringed the patent by making and using certain network equipment. Commil also alleged that Cisco indirectly infringed the patent by inducing infringement, that is, by selling the equipment to others and instructing them how to use the equipment, causing them to thereby infringe the patent.

At trial, the jury found that Cisco had directly infringed the patent. With respect to the claim of indirect infringement, Cisco contended that it did not have the required specific intent to induce infringement because it believed in good faith that the patent was invalid. The district court for the Eastern District of Texas ruled that Cisco’s evidence of its good faith belief was not admissible as a defense to infringement. The jury found Cisco liable to Commil and awarded Commil $63.7 million in damages.

Cisco appealed to the Federal Circuit Court of Appeals, arguing that the district court’s ruling was erroneous. The appellate court reversed the district court, holding that a good faith belief that a patent is invalid is sufficient to negate the required specific intent to induce infringement.

The Supreme Court reversed the Federal Circuit. The court explained that infringement and validity are two different issues. To prove that a defendant induced infringement, a plaintiff must show that the defendant knew that the induced acts constituted patent infringement.

The Court held that infringement and invalidity are independent of each other. A defendant may successfully defend against a claim of patent infringement by defending against the infringement allegation or by proving that the patent is invalid. A defendant may assert either noninfringement or invalidity or it may assert both.

The Court further explained its rationale in stating that allowing a good faith belief in invalidity to be a defense to infringement would undermine the statutory presumption that a patent is valid. Because of the presumption, a plaintiff does not have to prove its patent is valid. The defendant must prove invalidity by clear and convincing evidence. If the defendant could defend against infringement simply by showing a belief in invalidity, then that would weaken the presumption of validity by lowering the burden of proof needed to overcome it.

The Court noted that accused infringers can assert invalidity as an affirmative defense or as a counterclaim. They can also challenge a patent’s validity in a declaratory judgment action in federal court or in an inter parties review proceeding before the Patent Trial and Appeal Board.

Another rationale raised by the Court was the procedural difficulty and burden of litigating a defense of a belief in invalidity. Defendants would be incentivized to allege a belief in invalidity, which would be easier to prove than noninfringement. Moreover, patent infringement cases would become much more complex as juries might have to decide the defense of the defendant’s good faith belief in invalidity and the defense of actual invalidity.

In concluding, the Court took a shot at patent trolls (now referred to as non-practicing entities) and prodded the district courts to more aggressively stop them, stating:

“The Court is well aware that an ‘industry has developed in which firms use patents not as a basis for producing and selling goods, but, instead, primarily for obtaining licensing fees.’ . . . Some companies may use patents as a sword to go after defendants for money, even when their claims are frivolous. . . .

[I]t is still necessary and proper to stress that district courts have the authority and responsibility to ensure frivolous cases are dissuaded. If frivolous cases are filed in federal court, it is within the power of the court to sanction attorneys for bringing such suits. . . . It is also within the district court’s discretion to award attorney’s fees to prevailing parties in ‘exceptional cases.’”

The Court’s decision is not new ground – it just restates existing law: you cannot avoid liability for inducing infringement on the grounds that you thought the patent was invalid.

At a time when the world is reading about Bruce Jenner’s gender transition to Caitlyn Jenner, the federal Occupational Safety and Health Association (OSHA) has issued its best practices guidelines regarding providing restroom access for transgender employees.

In summary, here is what OSHA says:

The employee should determine the most appropriate and safest option for him- or herself.

The best policies also provide additional options, which employees may choose, but are not required, to use. These include:

• Single-occupancy gender-neutral (unisex) facilities; and
• Use of multiple-occupant, gender-neutral restroom facilities with lockable single occupant stalls.

Regardless of the physical layout of a worksite, all employers need to find solutions that are safe and convenient and respect transgender employees.

You can obtain a copy of OSHA’s best practices guidelines at http://www.dol.gov/asp/policy-development/TransgenderBathroomAccessBestPractices.pdf.

Abercrombie & Fitch (AF) refused to hire Samantha Elauf, a practicing Muslim, on the basis that the headscarf she wore during her interview conflicted with AF’s “Look Policy” which prohibits employees from wearing “caps” (a term that the Policy did not define). The Equal Employment Opportunity Commission (EEOC) filed suit on Elauf’s behalf, alleging a violation of Title VII of the Civil Rights Act of 1964, which, inter alia, prohibits a prospective employer from refusing to hire an applicant because of the applicant’s religious prac­tice when the practice could be accommodated without undue hard­ship. Elauf wore the headscarf as part of her religious practice as a Muslim but she did not communicate this to the manager who interviewed her nor did she ask for an accommodation in order to wear the headscarf.

The EEOC prevailed in the District Court, but the Tenth Cir­cuit reversed, awarding AF summary judgment on the ground that failure-to-accommodate liability attaches only when the applicant provides the employer with actual knowledge of his/her need for an accommodation. The U.S. Supreme Court granted review of the case and held that to prevail in a disparate-treatment claim under Title VII, an applicant need show only that his/her need for an accommodation was a “motivating fac­tor” in the employer’s decision, not that the employer had knowledge of his/her need.

The Supreme Court said that Title VII’s disparate-treatment provision requires Elauf to show that AF: (1) “fail[ed] . . . to hire” her (2) “because of” (3) “[her] religion” (including a religious practice). And Title VII’s “because of” standard is understood to mean that the protected characteristic cannot be a “motivating factor” in an employment decision. Thus, rather than imposing a “knowledge standard,” Title VII prohibits certain motives, re­gardless of the state of the actor’s knowledge.  According to the Supreme Court “[a]n employer may not make an applicant’s religious practice, confirmed or otherwise, a fac­tor in employment decisions. Title VII contains no knowledge re­quirement.”

The Court gave the following example to illustrate its point:  “[S]uppose that an employer thinks (though he does not know for certain) that a job applicant may be an orthodox Jew who will observe the Sabbath, and thus be unable to work on Saturdays. If the applicant actually requires an accommodation of that religious practice, and the employer’s desire to avoid the prospec­tive accommodation is a motivating factor in its decision [not to hire the applicant], the employer violates Title VII.”

Furthermore, the Court held that Title VII’s definition of religion clearly dictates that failure-to-accommodate challenges can be brought as disparate-treatment [aka intentional discrimination] claims. In doing so, the Court rejected AF’s argument that a neutral policy [against headwear at work] cannot constitute intentional discrimination. According to the Court, Title VII does not demand mere neutrality with regard to religious practices (e.g. that they be treated no worse than other practices). Instead, the law gives religious practices favored treatment, affirmatively obligating employers not “to fail or refuse to hire or discharge any individual . . . because of such individual’s religious observance and practice.”

The Take Away:

The Supreme Court concluded that an employer is surely entitled to have, for example, a no­ headwear policy as an ordinary matter. But when an applicant requires an accommodation as an “aspec[t] of religious . . . practice,” it is no response that the sub­sequent “fail[ure] . . . to hire” was due to an otherwise-neutral policy. Title VII requires otherwise-neutral policies to give way to the need for an accommodation.

But, how is an employer to know when the accommodation may be needed?

Unfortunately that question is not clearly answered by the Court’s decision.  In a footnote, the Court states that “[w]hile a knowledge requirement cannot be added to the motive requirement, it is arguable that the motive requirement itself is not met unless the employer at least suspects that the practice in question is a religious practice—i.e., that [it] cannot discriminate ‘because of’ a ‘religious practice’ unless he knows or suspects it to be a religious practice.”  However, as the Court explained, that issue was not presented in the case, since AF knew (or at least suspected) that the scarf was worn for religious reasons. The Court said that since the question was not discussed or briefed by either side, it is inappropriate to resolve it.

Let’s face it, we live in a progressive era. Many things that were once taboo in the eyes of the law have become not only socially acceptable, but legal. For example, twenty years ago, if a California state police officer saw you walking down the street smoking what he knew to be marijuana, you were unlikely to walk away without at least a citation. Now, that same officer would have to think twice before jumping to a conclusion and writing you a citation for possession of marijuana, because it is now legal to possess cannabis for medically related purposes in this state. In fact, as of the date of this article, 23 states and the District of Columbia have legalized the possession of marijuana in some form. Four states have even legalized it for recreational use.

At this point, you are likely wondering why I am yammering on about the legalization of marijuana in an intellectual property article. Not only is it unrelated, but honestly, its old news. However, the booming business that is emanating from the legalization of marijuana is not old news. That is exactly what I am here to discuss. If you have read any of my previous articles, you know that I am a strong proponent of protecting the goodwill in your brand through the federal trademark laws. This should not come as a surprise; it is more beneficial and less costly for my clients to retain my services for preventative intellectual property counseling than it is for litigation, or to lose goodwill in their brand.

Unfortunately, the typical avenues for protection are largely unavailable for individuals and entities in the marijuana business. The United States Patent and Trademark Office only registers marks that would be in lawful use in interstate commerce. It has even gone as far as refusing to register a mark such as MARIJUANA COOLERS for herbal food beverages on the ground that the wording in the mark “plainly indicates” that the goods include a substance prohibited by the Controlled Substance Act.

The Controlled Substance Act is the primary reason that proprietors in the marijuana business are unable to register their marks. The act renders the possession, sale, and use of marijuana illegal under federal law. This may sound familiar because the conflict between federal and state law is often discussed with respect to states that have legalized marijuana use in one form or another. Thus, in the eyes of the federal government, regardless of the state’s marijuana laws, the activity is illegal. The United States Patent and Trademark Office is a branch of the federal government. So, in the eyes of the United States Patent and Trademark Office, the activity, whether use, distribution, or something else, is illegal and it will likely deny any attempt to register a mark for marijuana itself. However, one may be able to register their desired mark on tangentially related items such as t-shirts or hats bearing the strain of marijuana’s name. This provides no protection at all for sale of the actual marijuana, but at least it provides some protection to tangentially related goods.

So, what else can you do? Well, just because the United States Government refuses to register the mark, it does not mean that the state government will refuse to register the mark as well. In fact, presently, this may be the most viable source of trademark protection for the marijuana itself. If the state, let’s say Colorado for example, has legalized the use, distribution, and sale of marijuana, it is not likely to refuse a trademark registration for such goods. It is not illegal so there does not seem to be a justifiable reason to refuse registration. However, this solution is not without downside. In contrast to its federal counterpart, the registration only provides protection in that state. Thus, the owner of the mark Ghost Train Haze with regard to marijuana in Colorado could not use his state trademark registration to sue a marijuana distributor in California, who is also marketing a strain that he calls Ghost Train Haze. It is unclear at this time whether the holder of the mark in Colorado could bring suit under common law, but such rights are typically narrowly construed and restricted to the geographic region where the product has historically been sold.

Thus, it would obviously be best for the holder of the mark if they were able to simply obtain a federal trademark registration, but that is not currently an option. Again, this does not mean that the marijuana proprietor is without some protection for his brand; a state trademark registration is a reasonable alternative. However, individuals in the business should keep tabs on the evolving state of the law and pounce on the opportunity to obtain a federal registration, if the federal government position ever happens to go…up in smoke.