Intellectual Property Law

Ninth Circuit Decides Trademark Case with an Anti-SLAPP Statute Twist

By Michael Atkins

On July 6, the Ninth Circuit decided a trademark case with an interesting twist.

The family-owned Mindys Cosmetics, Inc., sued its attorney for malpractice, breach of fiduciary duty, and conversion. The case concerns advice the attorney gave one of Mindys owners to register in her own name two trademarks the company formerly had owned but whose registrations had expired.

The attorney moved to strike the claims against him based on California’s anti-SLAPP statute, which protects against Strategic Lawsuits Against Public Participation. 

The Central District of California denied the lawyer’s motion. 

The lawyer appealed.

The Ninth Circuit found that filing a trademark registration constituted a “protected act,” and that the suit arises from that protected act, implicating anti-SLAPP protection.

“Each of Mindys’ causes of action arises not out of a general breach of duty, but out of [attorney Kia] Kamran’s act of filing the trademark application in [Sonya Dakar’s] name. The trademark application was not ‘incidental’ to the causes of action, but was their gravamen. But for the trademark application, Mindys would have no reason to sue Kamran. Because Mindys’ claims arose from Kamran’s act of applying to register the trademarks in Sonya’s name, they are properly subject to an anti-SLAPP motion.”

However, the court also concluded there was sufficient merit to Mindys’ claims that the suit should be allowed to proceed. For example, the court found that if Mindys’ evidence is credited, the lawyer “was at least negligent in determining who had authority to act on behalf of Mindys. Kamran admits that he took instructions to register the trademarks” from four different people, including one person Mindys argued had no authority to instruct him on behalf of the company.

For this reason, the court found “Mindys has thus made at least a minimal showing that Kamran did not ‘use such skill, prudence, and diligence as lawyers of ordinary skill and capacity commonly possess and exercise in the performance of the tasks which they undertake.’ Crediting the evidence submitted by Mindys, as we are required to do, Mindys has demonstrated a ‘reasonable probability,’ within the meaning of the anti-SLAPP statute, of prevailing on its malpractice and breach of fiduciary duty claims.”

The case cite is Mindys Cosmetics, Inc. v. Dakar, __ F.3d __, 2010 WL 2652480, No. 09-55134 (9th Cir. July 6, 2010). 

Full post as published by Seattle Trademark Lawyer on July 08, 2010 (boomark / email).