Patent Law

Has the 9th Circuit Really Eviscerated Internet Trademark Laches?

By Les Weinstein, Michael Young, John Leo Wagner, Eric van Ginkel, and Victoria Pynchon

See yesterday's opinion Internet Specialties West, Inc. v. Milon-DiGirgio Enterprises, Inc.

There's a vigorous dissent from Justice Kleinfeld culminating in this prediction of the majority opinion's affect on trademark law, particularly as it effects internet marks:

The majority's evisceration of laches means that a big company can lurk in the tall grass while its little prey gradually fattens itself by dint of great effort and expense. Then, when the small competitor has succeeded, the big company can shake it down for a cut of its hard-won success, or destroy the name under which it innocently did business for years. That is trademark law as protection racket, rather than trademark law as prevention of consumer confusion.

The ADR lesson?  There's a story of fierce business competition here fought out between two internet providers (living in the 21st century) and decided by the narrowest margin based on rules (laches) forged before the industrial revolution. 

Only the parties know whether the Plaintiff was aiming to "shake down" its competitor or had other motives to take the considerable risk of exposing its commercial future to the decision, first, of a federal court judge and then to a three-justice federal appeals court panel. 

Though commercial enterprises badly need clear rules of law to guide their present activities and chart a profitable future, they should never forget Google exec Eric Schmidt's observation that litigation is just a "business negotiation being conducted in the Courts" -- the litigation simply one bargaining chip of many to be used in negotiating a commercial solution to a justice problem - one that will avoid - if possible - zero sum outcomes on technical legal issues of no genuine interest to business people.

Dissenters from that view?

Full post as published by IP ADR Blog on March 18, 2009 (boomark / email).