Seyfarth’s Future of Automotive Series

On Tuesday, November 26, 2024, the Federal Trade Commission (“FTC”) released a staff report examining the duration of software support commitments by manufacturers of 184 connected devices, ranging from “smart” phones to health monitors to home appliances. The report found that nearly 89% of manufacturer web pages failed to disclose how long these products would receive software updates, even though some products cease to function without continued manufacturer support. The report concluded that “depending on the facts” a failure to inform prospective purchasers of the duration of the warranty on certain products could violate the Magnuson Moss Warranty Act (“MMWA”) or Section 5 of the FTC Act, suggesting a potential future enforcement push by the agency.

FTC’s Examination of “Smart” Devices

The FTC staff report comes after a September 2024 study by Consumer Reports evaluated the policies of 21 appliance brands and found that only three disclosed how long they will guarantee updates to their appliances’ software and applications.  The FTC compiled a list of 184 connected devices from different manufacturers used for personal or family purposes; motor vehicles were specifically excluded from the list.  FTC staff then used the manufacturer’s product webpage only—disregarding warranty and other documentation—to try to find information about software support duration or end date, reasoning that the average consumer was unlikely to do a broader search for information.  Using that methodology, only 11% of product web pages provided information about how long the product would receive software updates. Follow up Google searches yielded information about product support duration or end date for about 33% of the products.

The FTC staff report concluded that “[m]anufacturers’ failure to disclose the duration of their software support commitments warrants further consideration by policymakers and law enforcers.” According to the FTC staff, and “depending on the facts,” the failure to inform prospective purchasers about the duration of software updates for products sold with written warranties could violate the MMWA. The FTC staff also warned that the failure to provide software updates could be a deceptive practice in violation of Section 5 of the FTC Act, and noted that when evaluating a manufacturer’s failure to provide software updates or disclose limits on the duration of product support, “it is appropriate to consider the scope of injury caused by the failure, whether this injury is reasonably avoidable by consumers, and whether there may be any offsetting benefits arising from the failure to provide software updates or disclosures about the duration of software support.”

Telematics And The Automotive Industry

The FTC’s study comes at a time when motor vehicles increasingly rely on computer software updates to operate.  Manufacturers have faced legal challenges related to over the air (“OTA”) software updates, while some states have enacted regulations that require OEMs to compensate dealers for helping customers whose vehicles are subjected to an OTA update and to make certain disclosures to potential buyers concerning the OTA update capabilities of new vehicles.  Concerns about continued support for vehicle telematics systems were heightened in 2022 when certain cellular telephone service providers announced plans to shut down 3G networks still used to support the installed telematics systems of some vehicles. OEMs were able to provide workarounds for vehicle owners, but infrastructure support is a critical consideration in deploying new products.

Likewise, the recent right to repair movement has put a spotlight on vehicle telematics systems that allow vehicle generated data to be transmitted wirelessly to OEMs and their dealers.  Recent legislation in Massachusetts and Maine would require this information to be made available to vehicle owners and independent repair facilities; similar federal legislation has been proposed.  OEMs have faced uncertainty with respect to these laws while they await a decision from a federal judge following a bench trial in June 2021 on challenges to the constitutionality of the Massachusetts right to repair law and while a working group convened by the Maine Attorney General’s Office makes recommendations about enforcement of that state’s law, set to take effect in early 2025.

Thanksgiving is a time for family, gratitude, and—let’s be honest—lots of food. But for vegetarians, it can feel more like a minefield of side dishes. While others enjoy the turkey, vegetarians are often left piecing together a meal that usually consists of mashed potatoes, stuffing, sweet potatoes, mac and cheese, cranberry sauce, and salad. The turkey, as the table’s centerpiece, becomes a glaring reminder of what’s missing for those who don’t eat meat.

What if vegetarians could be brought back to the center of the table—literally? That’s where a clever idea from a patent application, US20050257694, comes in. This inventive solution proposed a method and apparatus for preparing a roast turkey analog made entirely from vegetarian ingredients. The invention included a mold that replicated the shape and texture of a traditional turkey, allowing a tofu-based “turkey” to be baked into a visually stunning centerpiece. With realistic turkey-skin texturing and an optional stuffing cavity, the mold aimed to make vegetarians feel fully included in the festivities.

Speaking as a carnivore, I’m unsure how appealing this would be—but that’s beside the point. The inventor made a genuine effort to ensure everyone could share in the holiday’s traditions without feeling left out.

The patent application included claims for both the mold itself and the method for using it to create the vegetarian turkey. Unfortunately, this dual focus led to a figurative fork in the road (i.e., a procedural challenge known as a restriction requirement).

A restriction requirement is issued by the U.S. Patent and Trademark Office (USPTO) when an application contains claims directed to two or more distinct inventions. Because U.S. patent law prohibits claiming multiple inventions in a single application, the applicant must choose one set of claims to pursue. The other claims can be filed separately in a divisional application.

In this case, the examiner determined that the method (steps for creating the vegetarian turkey) and the apparatus (the turkey mold) were distinct inventions. The method claims described the steps of preparing the tofu-based turkey, including mixing, pressing, and baking. The apparatus claims were focused on the mold’s structure and features, such as its turkey-skin texturing and multi-piece design.

Applicants faced with a restriction requirement often accept it and pursue divisional applications for each invention. Alternatively, applicants can challenge the restriction by showing that the claims are not distinct and independent.

To succeed, the applicant must demonstrate that the method and apparatus are inherently linked by a common inventive concept.  That is, the method and apparatus are not distinct or independent. For example, one could argue that the method as claimed cannot be performed using another apparatus, or that the mold itself cannot be used for a process materially different from the one described. If successful, this approach would follow the spirit of Thanksgiving and allow both the method and apparatus claims to remain in a single application, providing broader protection and reducing costs.

Unfortunately, the applicant for this patent application did not respond to the restriction requirement, resulting in the application being abandoned. As a result, the mold and method were never examined further, leaving us to wonder if this inventive idea could have been granted patent protection and brought everyone together at the Thanksgiving table—well, everyone except for your crazy uncle (we all have one).

This Thanksgiving, whether your centerpiece is a roast turkey or a tofu-based alternative, remember that the table is about more than food. It’s about making sure everyone feels at home.

Attention, inventors, in-house counsel, and anyone with a vested interest in the world of intellectual property: the USPTO just issued its final rule for patent fees. This is a follow-up to the 2023 proposal—but with a slightly softer landing.

Starting January 19, 2025, the cost of securing those all-important patent rights is going up—because inflation, higher examiner pay, and new small-entity discounts have left the USPTO needing more revenue to keep the lights running. USPTO Director Kathi Vidal, who is heading back to private practice next month, assures us these changes will “enhance examination quality” and keep pendency goals on track. So, while you may be feeling the burn in your wallet, rest easy knowing the extra cash is (hopefully) going to good use.

Most fees will increase by 7.5% across the board (down from the proposed 10%—phew!). Filing, search, and examination fees will see a smaller bump of 2.5%. Still, the USPTO points out that these increases are lower than inflation since 2020, so… yay for perspective?

Here is a brief summary of what is changing and what is staying (relatively) the same after some heavy public pushback. The fee changes are not limited to the fees discussed below. As noted in the Federal Register notice, the USPTO is setting or adjusting 433 fees, including 52 new fees.

  • Patent Term Extensions (PTE): Originally slated to jump from $1,180 to $6,700, the fee is now a more reasonable $2,500. Drug industry critics called the earlier hike a “tax on innovation,” and the USPTO relented, but only a little.
  • Requests for Continued Examination (RCEs): No more tiered pricing! The second and subsequent RCEs will now cost $2,860 (instead of the proposed $3,600 for the third). Critics argued the previous plan penalized applicants for clarifying rights. The USPTO says it’s not here to discourage filings, just to align fees with costs.
  • Continuing Applications: Filing fees kick in at six years ($2,700) and nine years ($4,000) after the original application, giving applicants more breathing room than the five- and seven-year proposals from 2023.
  • Design Patents: Filing will now cost $2,600 (up from $1,760). Critics argue that it is too steep compared to other countries, but the USPTO says its examinations are more thorough.
  • PTAB Proceedings: Inter partes review will now set you back $23,750 for up to 20 claims. Post-grant reviews? $25,000. Ouch.
  • Director Reviews: This new fee ($452) covers requests for the USPTO director to review PTAB decisions. Fun fact: this used to be free. All good things must come to an end!

With fee-setting authority expiring in 2026, it’ll be interesting to see if Congress lets the USPTO keep the reins. Critics are warning that these “dramatic” increases could put the USPTO’s fee-setting authority in jeopardy. The office counters that it’s listening to feedback while staying financially responsible. With the freshly minted Department of Government Efficiency (DOGE) on the horizon, perhaps the USPTO is preemptively hedging against potential cost-cutting interventions. Stay tuned—this could get interesting!

Mark your calendars for January 19 and get those budgets ready. These fee changes are approaching fast. If you are working with budget constraints, consider filing your patent application or tackling related prosecution matters before the deadline to save some cash.

Originally sourced from Seyfarth’s The Blunt Truth Blog.

Recent legislative changes in California have opened up exciting opportunities for cannabis lounges and retailers. With a new law allowing on-premise consumption areas, the sale of food and drinks, and the hosting of live music events, businesses are gearing up to create unique and engaging experiences. However, as these businesses expand and innovate, it’s crucial for all brand owners to consider the implications for trademarks in the cannabis industry. 

This “cannabis café law” will allow existing cannabis retailers and consumption lounges to sell non-cannabis food and beverages and host live entertainment. The bill goes into effect January 1, 2025. 

The relatedness of cannabis and non-cannabis food and beverage goods is not newsworthy.  Indeed, consumption of the former may lead to indulgence in the latter. But the cannabis café law could potentially lead to consumers associating a brand in the cannabis industry with one that is not.

For instance, cannabis infused baked goods could be provided at the same location as your favorite cookie brand. Chasing your favorite soda with a cannabis infused beverage may shortly be a possibility. After a Mission burrito for dinner, you could catch a show across the street at a cannabis café. 

With the line between cannabis and non-cannabis offerings blurring more than ever, it may be difficult for business owners to distinguish themselves. Also, it’s more important for those in the food and beverage space to consider existing cannabis brands before adoption of a trademark. 

So, what are some things to mull over before the first cannabis café opens?

  • Cannabis café operators should consider existing brands for restaurants, entertainment spaces, and food and beverage goods before adopting a trademark for their café. 
  • Non-cannabis brands should determine whether a cannabis café’s trademark encroaches on rights to their goods or services.
  • Cannabis operators should evaluate their existing trademark portfolio, in particular California state registrations, and determine whether additional filings for restaurant or entertainment services are warranted.
  • Irrespective of industry, those in states neighboring California should keep an eye on cannabis café brands that may conflict with their trademark rights.
  • Consideration should be given to whether federal trademark rights may be provided for non-cannabis related goods and services offered by a cannabis brand.

The cannabis industry continues to evolve and converge with those operating in separate but perhaps related industries. Ensuring that your marks are distinguishable from others in a crowded field of operators is crucial for ensuring a valuable brand. We’ll see what happens after the smoke clears and cannabis cafés are in full swing. 

November 11 – 13, 2024
Fairmont Scottsdale Princess
Scottsdale, AZ

Seyfarth Shaw is a sponsor for the 2024 ANA Masters of Advertising Law Conference, the biggest advertising, marketing, and promotion law conference in the nation.  The conference will take place November 11-13 at the Fairmont Scottsdale Princess in Scottsdale, Arizona. During the conference Seyfarth attorneys Joe Orzano and Kristine Argentine will present on a breakout panel and Ken Wilton, Ameena Majid, and Gina Ferrari will lead a roundtable discussion. Additional details are provided below. 

BREAKOUT 5D: CONSUMER CLASS ACTION LITIGATION UPDATE

Monday, November 11, 2024

This session will focus on consumer class actions, including false advertising and privacy class actions.  The panel will feature insights on litigation trends including common claims and types of products and services targeted, as well as theories of liability, over the past year.  The panel will also discuss defenses to commonly asserted false advertising and privacy claims and how those defenses are being received by courts.  The panel will also include the latest proactive tips and strategies to maintain active advertising and marketing of products and services, while minimizing the risk of being targeted by the plaintiffs’ bar.

Panelists:

Joe Orzano
Partner and National Co-Chair, Advertising & Marketing Group
Seyfarth Shaw LLP

Kristine Argentine
Partner and National Chair, Consumer Class Action Defense Group
Seyfarth Shaw LLP

Jessica Bahr
Vice President, Deputy General Counsel
Constellation Brands

Jenn Greenberg
General Counsel
Frida

ROUNDTABLES WITH THE EXPERTS: THE PERILS OF OVERHYPE: UNMASKING GREENWASHING AND AI WASHING

Tuesday, November 12, 2024

In today’s world, companies are expected – and even required – to share their environmental and other ESG advancements to gain consumer trust.  It’s table stakes to maintain and increase market share.  Not all claims are as genuine as they seem; even if well-intentioned.  This roundtable will explore the potentially deceptive practices of greenwashing, AI washing, rainbow washing, and other exaggerations of an organization’s progress.  We’ll touch on the risks and consequences of these misleading tactics, from both a regulatory and a civil liability perspective.  Join Ameena Majid, Gina Ferrari and Ken Wilton of Seyfarth Shaw as they prompt discussions surrounding these timely and increasingly important topics.

Presenters:

Ken Wilton
National Co-Chair, Advertising & Marketing Group and National Trademark Practice Lead

Ameena Majid
Seyfarth’s Impact & Sustainability Partner and Co-Chair of the firm’s Impact & Sustainability Practice Group

MORE INFORMATION & TO REGISTER

World Trademark Review quoted Ken Wilton in its article, “US presidential election 2024: what a Donald Trump victory could mean for trademarks in the United States,” on October 19. Wilton discussed what a Trump victory would mean for the future of brand protection.

“A new Trump administration is likely to renew its prior efforts to combat counterfeiting and piracy with more overt threats to online platforms to implement more stringent anti-counterfeiting measures.”

The full article is available here.

Seyfarth’s Lauren Leipold and Ken Wilton co-authored “Courts and TTAB weigh in on First Amendment defence and scope of rights protection under the Lanham Act,” the exclusive United States chapter for WTR’s Trademark Litigation Review 2025. The Seyfarth attorneys discussed an overview of key developments in trademark litigation in the United States over the past year. World Trademark Review describes the Review as “cast[ing] an expert eye on some of the most pressing issues facing those involved in litigation on both sides of the divide, blending analytic insight with on-the-ground expertise from the key regions of the Americas, the Asia-Pacific, and Europe, the Middle East and Africa.”

The full article is available here.

Halloween is a time for goblins, ghouls, and—if you’re an inventor—a whole lot of creative thinking! Among the cauldron of Halloween patents, one particularly clever design stands out: a patented method for decorating pumpkins (and, technically, other fruits…but we’re not holding our breath for Halloween coconuts). Meet U.S. Patent 6,855,224, an invention that makes it easy to transfer intricate designs onto pumpkin surfaces.

This invention takes the hassle out of the traditional pumpkin pattern transfer process. These days, social media is full of reels showing tricks to make pumpkin carving a real treat. Still, for those of us who grew up carving with mom’s dull kitchen knife, we know the process can be harder than waking the dead, so you’ll appreciate the genius behind this idea. Here, the magic is in a patterned adhesive sheet that sticks directly to the pumpkin (or your “fruit” of choice). Just peel off the liner, press the sheet onto your pumpkin, and carve along the lines. And when you’re done? Just peel away the sheet to reveal a spooky, professionally styled creation! Gone are the days of dealing with fading marker outlines when trying to carve the pumpkin.

Interestingly, this patent isn’t just for pumpkins; it’s broad enough to cover all fruits and vegetables! But let’s be real, Halloween is a pumpkin’s night to shine. Broadening the scope is a classic patent strategy so that the invention can apply to a wide range of surfaces, just in case anyone decides that jack-o’-lantern watermelons should be a thing.

Interestingly, this patent only covers the method of decorating fruits and vegetables, not the product itself. Specifically, the claims protect a series of steps: providing the product, peeling the liner, sticking the adhesive pattern onto the pumpkin, and carving along the lines. While method claims can pack a punch in areas like communications, machine learning, or manufacturing, enforcement can be tricky when the method is direct to using a product because the “infringer” is the user of the product (i.e., the person carving the pumpkin). You’d have to be a real witch to enforce a patent against Halloween fans!

In some cases, when method claims are at play, patent holders may go after manufacturers or sellers of infringing products under an inducement theory. To prove inducement, the patent holder would need to show that a seller or manufacturer encouraged consumers to use the infringing product in a way that infringed on the patented method—usually through marketing materials or instructions. To overcome inducement allegations, the seller/manufacturer can show that the infringing product has non-infringing uses. For example, similar stencils could even be marketed as fun tools to decorate fruits and vegetables without carving along the lines!

Luckily for all the fruit and vegetable carvers out there, this patent expired in 2022, so there is no need to fear any courtroom frights! As you head out trick-or-treating this Halloween on the hunt for those elusive full-size candy bars, take a moment to appreciate the art of pumpkin carving. And who knows, maybe you’ll spot a carved fruit or two along the way!

Seyfarth IP partner, Matthew Moersfelder, authored an article, “Penn State Merchandise Case Runs Up Costs for Trademark Owners,” in Bloomberg Law . Moersfelder discussed the impact of Pennsylvania State University suing Vintage Brand LLC, alleging the company willfully infringed various Penn State trademarks by selling products featuring those marks on its website.

“If consumers are purchasing merchandise solely because they want to show support for a favorite company or brand, but not because they believe the merchandise itself is affiliated or endorsed by the company or product, then a similar result should follow.”

The article was also later referenced in Print & Promo Marketing.

On October 7, Seyfarth partner Lauren Leipold co-presented a Strafford webinar on “International Trademark Protection After Abitron: Branding and Enforcement Considerations.” Lauren was joined by Thomas Brooke of Holland & Knight and Martin Schwimmer of Leason Ellis.

The Supreme Court’s ruling in Abitron v. Hetronic (U.S. 2023) limited the extraterritorial reach of the Lanham Act, stating that infringement claims are confined to domestic uses. This raises important questions about what constitutes “use in commerce” under the Act, and underscores the necessity for U.S. trademark owners to explore robust strategies for protecting their marks internationally.

The panel of experienced trademark attorneys discussed the implications of the Abitron decision and what U.S. companies should do if they believe they are victims of foreign trademark infringement. The panel also discussed how this informs and impacts a company’s brand protection and enforcement strategies within and outside the U.S. The discussion was a reminder of the evolving challenges in trademark law and the importance of staying informed.

Key Takeaways from the Webinar

  • The standard for “use in commerce” remains murky. The panel discussed differing approaches and definitions adopted by lower courts and by the Supreme Court in Abitron, suggesting that post-Abitron, more direct ties to U.S. commerce are required before a foreign defendant’s activity will be subject to Lanham Act protection.
  • Personal jurisdiction remains key. Even if Abitron’s “use in commerce” standard does not require a sales transaction in the U.S., jurisprudence that has developed over the past several decades surrounding personal jurisdiction over foreign defendants suggests that a domestic sale is key.
  • Brand protection strategy. The panel discussed the importance of shoring up registrations in other jurisdictions in order to lay the proper groundwork to enforce against cross-border infringers. In addition, the panel suggested that the contributory infringement doctrine may be useful in this context.

View the full recording here.