James Nguyen, Senior Counsel at Foley & Lardner, presented two discussions, the first entitled "Post-Registration Strategic Maintenance and Protection of Your Trademarks." He noted that "Trademarks can be a powerful sword, but needed to be actively shielded to protect their strength."
Nguyen covered several helpful tips for managing a trademark portfolio. Counsel should document the first use of a mark, as this may be vital years later in enforcing the mark.
Counsel can also strengthen a mark by expanding uses of the mark into secondary product classes. Also, tracking advertising expenditures by brand or division facilitates establishing later how much money was spent promoting an individual mark. Finally, continuous use is another component of successful trademark management. Counsel should implement a system to regularly monitor the continued use of the company's marks.
In the competitive, fast-paced world of the Internet, Nguyen advises counsel to register all major corporate marks as domain names. Also consider whether your company should defensively register potentially infringing domain names to keep others from having those domain names.
Regularly monitoring your licensees to ensure quality control over their use of your mark is a way to prevent an abandoned, "naked license." "Trademark administrators should be like Madonna; they should pop up everywhere." Nguyen went on to state, "Invest in trademark watch services and domain name monitoring services; they are relatively inexpensive and well worth it for protecting your marks."
James' second discussion topic was entitled "Civil Court Trademark Infringement & Dilution Claims." He opened with a teaser: "This past year's trademark cases can be summed up by things that get people excited: lingerie, the Internet, and Dwight Eisenhower - though not necessarily in that order."
In the initial topic, Nguyen indicated that as a result of the Supreme Court's decision in the "Victoria's Secret" case (VICTOR'S LITTLE SECRET v. VICTORIA'S SECRET), having consumer survey evidence will be critical to establish "actual dilution" needed for a federal trademark dilution claim.
When protecting a client's marks, attorneys should remain mindful of the decision in Dastar Corp. v. Fox, which held that although Lanham Act claims can be used creatively, the Supreme Court essentially found they cannot be stretched too far. Nguyen commented, "In 2003, the judicial trend has been to reign in trademark claims lest they become too broad." Thus instead of including a tenuous FTDA claim, he recommends focusing on the best available claims, such as injunctive relief, state anti-dilution laws, and other claims to enforce your company's marks.
Nguyen next addressed potential infringement issues connected to Internet domain names and web pages. When a famous mark is used by another company in its domain name, the critical factor for infringement is whether the two companies' goods or services are related. Nguyen indicated that it is infringing to use another company's famous mark in meta-tags to drive traffic to your Web site. As a precautionary measure, companies should review their meta-tags for any potentially infringing marks.
Next, William J. Robinson, a Partner at Foley & Lardner, presented a discussion on IP Litigation strategies. His talk primarily focused on managing IP litigation costs, an area that has seen tremendous expansion, both in terms of amounts that clients have at stake and the price of participating in an IP case.
For example, according to the American Intellectual Property Lawyers Association (AIPLA), the average cost of patent litigation is $2M, trademark litigation is $600K, and other types of IP litigation average between $500K and $800K. Robinson put forth his ideas of why these costs are so high, and what can be done to bring them under control.
First and foremost, Robinson observes that most clients are not actively involved in tactics, strategy, and in controlling the costs of their cases. As a result of not remaining involved in the litigation process, clients give up "ownership" of a case to a law firm. This loss of control leads to overstaffing, overworking, and allows the lawyers to make all these costly staffing and strategic decisions.
When considering IP litigation, Robinson stresses the importance of what he calls, "The Right Attitude." This attitude applies to both the client and attorney, and is comprised of three main ideals: 1) Cost control works; 2) Cost control will not mean malpractice; and 3) Lower costs may mean higher quality.
Robinson indicates several important factors to implementing cost control. Having a lead counsel is largest factor in managing litigation costs. Clients should select a lead counsel by reputation and ability, not by firm. Ideally the lead counsel should be trustworthy and have the time to take an active role in the case.
Staffing is another major way to control litigation expenses, and an early emphasis on staffing control is critical. As a preliminary matter, clients should know their law firm's staffing philosophy and modify it as necessary. In a typical IP case, staffing consists of a three-lawyer team, plus a paralegal. Costs can be lowered by using more senior and experienced lawyers and by using the client's in-house staff as part of litigation team. Clients should be wary of heightened costs when they observe multiple lawyers at depositions and hearings, a lead counsel that is not involved until just before trial, and paralegals charging for basic secretary work.
In addition, having the right cost control tools is invaluable. Robinson believes that the Case Strategic Plan and the Case Budget serve cost initiatives well. Because litigation is a strategic business decision involving the commitment and employment of significant corporate resources, it is crucial to identify the ultimate strategic business goals for the litigation and the most efficient way to accomplish them.
The Case Budget should be used in conjunction with the Case Strategic Plan, and should meet outcome and cost objectives. The document should establish a budget by case phases, such as fact investigation, discovery, motions, pretrial, and trial, and should also set limits for activities within these phases. Robinson advises clients to view the budget as estimate, and states that it is important to "Be flexible, as more than a three-month advance view may be difficult after litigation starts."
Robinson concluded by discussing the proper use of technology in litigation. As a cost saving measure, firms should maintain important documents and deposition transcripts in a searchable electronic database. Setting up a client-firm intranet, where all pleadings and significant documents are kept electronically, is also helpful. Other cost conscious uses of technology include the use of video teleconference for less-significant depositions, and avoiding excessive scanning, coding, and computerizing of unimportant documents.