Jay Myers, Seyfarth partner and Director of Innovation for the Intellectual Property Group, joined Arun Hill, senior consultant at The Clarivate Center for IP and Innovation Research, as a guest in Clarivate’s most recent podcast episode, “Ideas to Innovation: Navigating the AI Frontier in Intellectual Property Law.” Clarivate, a global leader in providing solutions to accelerate the lifecycle of innovation, helps customers solve some of the world’s most complex problems. The podcast episode covers the transformative influence of artificial intelligence (AI) on intellectual property (IP) and trademark law. It offers valuable insights into how organizations can leverage AI to navigate the complexities of IP law, striking a balance between innovation and the critical human element of legal expertise. Follow the links below to listen in and explore how AI is not only automating tasks, but also augmenting the capabilities of IP professionals to achieve higher-quality outcomes for their clients.

Podcast Links:

Clarivate

Amazon

Apple

Spotify

The USPTO’s recent guidance on AI usage marks a critical moment for legal practitioners. This document emphasizes the necessity for both technical and human oversight in mitigating the risks associated with AI tools. The agency is committed to leveraging AI’s benefits across society while ensuring that these technologies do not compromise the integrity of legal processes.

The guidance clarifies that existing USPTO rules and regulations fully apply to AI-assisted activities. It serves as a reminder of the importance of human oversight and the need for attorneys to understand the workings of AI tools to utilize them responsibly. Here’s what every patent attorney needs to know:

  1. Duty of Candor and Good Faith: Central to the guidance is the reaffirmation of the duty of candor and good faith, extending to all interactions with the USPTO. This means that any AI-generated work must be meticulously reviewed to ensure its accuracy and completeness before submission.
  2. Signature and Certification Requirements: Under 37 CFR 11.18(b), signatures and accompanying certifications must affirm the truthfulness and reliability of submissions. The guidance explicitly states that relying solely on AI for these assurances is insufficient.
  3. Duty of Disclosure: Particularly in patent applications, the guidance highlights scenarios where AI’s role must be transparent. For example, if AI significantly contributes to a document’s drafting, such details must be disclosed and verified for accuracy.
  4. Operational Compliance: The guidance underscores that AI tools cannot hold USPTO.gov accounts nor represent clients independently. Practitioners must ensure that their use of AI does not infringe on federal and state laws or USPTO policies.
  5. Confidentiality and Security: Given that AI tools might store and process data on servers globally, there’s a heightened risk of unintentional data breaches. Practitioners must safeguard client confidentiality and adhere to national security regulations regarding data export.

The USPTO’s guidance arrives at a time when patent attorneys are increasingly turning to AI for tasks like prior art searches and the drafting of patent applications and responses to office actions. This trend is set to grow with upcoming changes, such as the fee increase for Information Disclosure Statements (IDS) filings. AI offers a viable solution to manage extensive prior art references efficiently without overwhelming legal professionals or the USPTO’s examiners.

However, this also introduces challenges. The USPTO warns against overburdening the office with non-essential references, emphasizing that practitioners must perform thorough reviews rather than relying on AI to filter out irrelevant material automatically.

The new guidance is a reminder that patent practitioners must navigate the use of AI tools with attention to detail and adherence to ethical standards. As the landscape of AI integration within patent law continues to evolve, practitioners should remain proactive in educating themselves and their teams about the latest developments and USPTO guidelines. By fostering a culture that emphasizes ethical AI usage and staying adaptable to new regulatory updates, patent law professionals can harness AI’s capabilities effectively while upholding the integrity of their practice and the broader patent system.

In the digital age, fans have embraced the opportunity to put a spin on famous corporate logos. Reimagining logos may be a way for consumers to express a connection they have to the brands, teams, and franchises they love and support. However, it does not come without legal risks.

There is a fine line between drawing inspiration from existing works and intellectual property infringement. Creating fan art that inadvertently infringes on intellectual property rights is common and can be disheartening for fans and consumer centric companies. However, having a basic understanding of trademark and copyright law may foster an understanding between enthusiasts and companies with a brand to protect.

Trademark Law

Trademarks are logos, symbols, words, or designs that identify the source of a company’s goods or services and provides legal protection for its brand. To avoid causing confusion among consumers, trademark law prohibits the use and registration of marks that are confusingly similar to another trademark. When determining whether a mark is confusingly similar, courts consider the sound, appearance, and commercial impression of the mark and whether the goods or services are related.

While fan art is often viewed as a form of appreciation, incorporating trademarks can be misleading to the public. The public may believe that the art is licensed or affiliated with the company and consequently runs of the risk of undermining the brand owner’s rights. Therefore, artists should avoid using another brand’s trademark without proper permission and companies should exercise caution when publicly engaging with unlicensed fan-art to avoid misleading the public.

Copyright Law

Copyright is a form of protection for “original works of authorship” fixed in a tangible medium of expression. Copyright infringement occurs when a copyrighted work is reproduced, distributed, performed, publicly displayed, or made into a derivative without permission. Under copyright law, derivative works are works based on or inspired by pre-existing copyrighted expression and again, require permission from the original copyright owner to be published. To determine whether derivative works are in fact infringement depends on whether the work qualifies as fair use. To evaluate fair use, courts look at the purpose and character of the use, the nature of the copyrighted work, the quantity and quality of the copyrighted material used, and the effect the use has on the market for the copyright owner’s original work.

Logo designs are protected under copyright law and grants the copyright owner the exclusive right to use the logo for commercial purposes. The recreation of a famous logo is likely to be considered a derivative work. Those who recreate logos without permission from the copyright owner should understand that drawing inspiration can easily cross the line into infringement, even if the intent is to show appreciation. On the other hand, companies may consider other avenues such as fan-art contests or licensing programs that encourage its fans creative expression, but is mutually beneficial and legal.

The United States Patent and Trademark Office (USPTO) has proposed significant changes to patent fee structures for the 2025 fiscal year. These proposed changes mark a pivotal shift in the Office’s financial approach toward patent filings. 

The proposed fee changes are available here.

These adjustments stand out not just for their size but for the profound implications they may have on how applicants navigate the patent process. 

A key highlight from the proposed changes is the new fee regime for continuation applications. Specifically, surcharges will be applied based on an amount of time since the earliest priority date. For example, applicants will face a surcharge of $2,200 for filings that occur more than five years after the earliest priority date, escalating to $3,500 for those submitted beyond eight years.

The fee increases also extend to Request for Continued Examination (RCE) filings, with the USPTO proposing raises between 25% and 80% for second and subsequent RCEs, promoting more efficient application processes.

Other fee changes include:

  • Increasing Design Application fees to account for inflationary cost increases;
  • Increasing excess claim fees, urging applicants to present more succinct and focused patent applications;
  • Reducing extension of time (EOT) fees for provisional applications;
  • A tiered structure for Information Disclosure Statements (IDS) based on the number of references cited.  For example, fees will be $200 for more than 50 references, $500 for over 100, and $800 for beyond 200 references;
  • A 25% fee increase for inter partes review (IPR) and post-grant review (PGR) proceedings to cover the expenses of these processes; and
  • A $500 fee for participation in AFCP 2.0 (there is currently no fee for participation in this program).

These proposed changes are a strategic tool to influence patent filing practices. The new fee schedule is expected to be implemented at the start of fiscal year 2025, on October 1, 2024.

Feedback on these proposals is open until June 3, 2024, and must be submitted via the Federal eRulemaking Portal.

Keep an eye on this space for further updates on these significant changes in the patent filing arena. In view of the proposed changes, applicants should consider recalibrating their filing and prosecution strategies. This may include expediting continuation applications, accepting allowable subject matter promptly, and narrowing claims to adapt to the evolving fiscal environment.

On Thursday, April 4, 2024, Seyfarth’s Los Angeles – Century City office hosted the INTA Roundtable Discussion on Cultural Competency and Working with Foreign Counsel.  Fellow trademark attorneys, IP paralegals, and law students gathered for a spirited discussion about what “cultural competence” means to them and how understanding and respecting different customs, cultures, and even ethical considerations can make for lasting business relationships and friendships.  Ken Wilton and Amy Abeloff, who hosted the event, would like to thank all who attended and participated in the Roundtable, and look forward to hosting future Roundtables.

A whole host of creators have filed suit in the U.S. alleging that AI companies improperly used the creators’ content to train AI programs (if you need to catch up on these lawsuits, we recommend our video blog here).  In most cases, the creators don’t know for sure whether the AI companies copied their works, although they allege that copying can be inferred based on the AI programs’ outputs.  But a new law in the EU may soon provide creators with a mechanism to find out if their works have been copied, and may provide those creators with greater protections than those afforded to creators in the U.S.

On March 13, 2024, the European Parliament approved the Artificial Intelligence Act, known as the AI Act.  Formal adoption of the AI Act is expected in early Summer 2024, with implementation spearheaded by the newly-formed European AI Office.  The AI Act is the one of the first major legislative frameworks in the world to emerge in response to the spread and seeming ubiquity of the relatively new generative AI technologies. The Act aims to ensure safety and compliance with certain individual and property rights, including IP rights.

The AI Act will regulate AI programs based on the level of risk they present.  Generative AI programs that are capable of generating text, images, and other content, and may perform any number of functions with general or specific purposes, are classified as “high risk.”  The AI Act refers to these programs as “General Purpose AI” or GPAI.  The AI Act places the most stringent obligations on developers and deployers of high-risk AI systems that are put to use in the EU, even if the developer or deployer is not actually based in the EU.  This partly because the EU believes that application to non-EU companies whose programs will be used in the EU is “necessary to ensure a level playing field among providers of [GPAI] models where no provider should be able to gain a competitive advantage in the EU market by applying lower copyright standards than those provided in the [EU].”   

Under the AI Act, GPAI model providers must:

  1. provide technical documentation, including training, testing processes, and results of evaluations;
  2. provide information and documentation to supply to end providers that intend to integrate the GPAI model into their own AI system so that the latter understands the capabilities and limitations thereto and is able to comply with the AI Act’s requirements;
  3. establish a policy to abide by the EU Copyright Directive; and
  4. publish a detailed summary about the content used for training the GPAI model.

One goal of these provisions to ensure that AI developers are disclosing whether the used material subject to copyright protection to train their AI programs.  There are some exceptions, however, including for “open license” AI models, which only have to provide disclosures if their AI programs present a “systemic risk.”

For those companies required to make disclosures, they must prepare sufficiently technical summaries to encourage IP rightsholders or others with legitimate interests to exercise and enforce their rights in the EU.  The EU AI Office will not be conducting a “work-by-work” assessment to ensure that GPAI providers are abiding by copyright laws.  Instead, the Office has passed the onus on to GPAI providers to satisfactorily educate rightsholders about their enforcement rights and responsibilities vis-à-vis the use and incorporation of their content by GPAI.

Companies must also “establish a policy to abide by the EU Copyright Directive,” that “requires the authorization of the rightholder concerned” before using any copyright protected content “unless relevant copyright exceptions and limitations apply.” The Directive does have some exceptions to this requirement, such as allowing reproductions of works for the purposes of text and data mining in certain limited scenarios.  Unless that text/data mining is for scientific purposes, however, the rightsholder can opt out. 

If a rightsholder opts out, then under the terms of the Copyright Directive and the AI Act, companies must “identify and respect the reservations of rights expressed by rightsholders pursuant to Article 4(3) of Directive (EU) 2019/790.”  Accordingly, GPAI providers would have to obtain special permission from the rightsholder that opted out in order to proceed with text/data mining activities that would access or utilize their protected content.

The AI Act includes a carve-out for small GPAI providers, such as start-ups, to promote innovation even for those with fewer resources than large corporations.  The carve-out provides “simplified ways” for smaller providers to comply with the AI Act.  The idea is that compliance with the AI Act should not “represent an excessive cost” or “discourage the use of [GPAI] models.”

It remains to be seen what will happen once the AI Act is officially enacted, but we expect an uptick in copyright litigation and related counseling (as well as costs) in the EU brought by copyright owners and other rightsholders.  We also expect that the number of potential stakeholders will increase by virtue of the ubiquity of GPAI and the ease and accessibility of content via the Internet and connected devices.  With this may come niche legal practices and novel legal issues, which will likely result in changes to the AI Act or its interpretation.  It will be crucial for owners of IP and AI companies to understand their respective rights and obligations under the AI Act; otherwise, IP holders risk unfettered and unauthorized use of their creative content, while AI companies run the risk of being sued.

Tennessee has joined the ranks of states regulating, in various ways, the use of artificial intelligence to manipulate an individual’s likeness.  On March 21, 2024, Gov. Bill Lee said “thank you very much” to the Tennessee legislature and signed into law the Ensuring Likeness, Voice, and Image Security (“ELVIS”) Act of 2024, HB 2091/SB 2096, which updates Tennessee’s right of publicity statute.  The new law is groundbreaking because Tennessee has gone beyond other states that regulate AI-generated, sexually explicit “deepfakes.”  The ELVIS Act represents the broadest prohibition yet on the unauthorized use of an individual’s voice or likeness. 

The right of publicity (sometimes called the right of personality) is a patchwork framework of laws that differ from state to state, built out of both statutes and common law.  The general purpose of such laws is to prevent the unauthorized commercial exploitation of a person’s likeness.  Many states, including Tennessee, extend protection to the deceased (which, in the case of Tennessee, was motivated largely by the iconic Memphis resident whose name is reflected in the law’s title, Elvis Presley). 

Prior to the ELVIS Act, Tennessee’s right of publicity law broadly held that “[e]very individual has a property right in the use of that person’s name, photograph, or likeness in any medium in any manner.”  Tenn. Code Ann. § 47-25-1103 (2021).  The ELVIS Act adds “voice” to the list of protected items.  HB 2091/SB 2096 § 4.  The Act defines “voice” as “a sound in a medium that is readily identifiable and attributable to a particular individual, regardless of whether the sound contains the actual voice or a simulation of the voice of the individual.”  Id.§ 3 (emphasis added).

The Act goes further, too, in expanding the scope of what acts create liability.  Prior to the ELVIS Act, a person would be liable for unauthorized use of a likeness “for purposes of advertising products, merchandise, goods, or services, or for purposes of fund raising, solicitation of donations, purchases of products, merchandise, goods, or services…”  Tenn. Code Ann. § 47-25-1105.  But the ELVIS Act expands liability to any person who “publishes, performs, distributes, transmits, or otherwise makes available to the public an individual’s voice or likeness” without authorization, regardless of purpose, and to any person who “distributes, transmits, or otherwise makes available an algorithm, software, tool, or other technology, service, or device” to produce a person’s voice or likeness without authorization.  HB 2091/SB 2096 § 6.  Although Tennessee’s law has an exemption for “fair use,” the ELVIS Act clarifies that the exemption only applies “to the extent such use is protected by the First Amendment.”  Id. § 10.

The bill passed unanimously and the ELVIS Act becomes effective as of July 1, 2024.

Publicity rights are often a minefield for brands and advertisers.  Changes in technology, including the ability of AI to manipulate and mimic the images and voices of public figures, have accelerated concerns about the unauthorized exploitation of likeness rights, including AI generated images and videos appearing in advertisements or AI generated “deepfake” music.  We may see more bills like the ELVIS Act in the future to ensure that there is no need for suspicious minds when encountering a person’s likeness.

On Thursday, April 4, 2024 from 11:30 a.m. to 1:30 p.m. Pacific, Seyfarth’s Los Angeles – Century City office will host the INTA Roundtable Discussion on Cultural Competency and Working with Foreign Counsel. This roundtable offers a unique opportunity to engage with seasoned experts, share insights, and explore best practices for fostering productive relationships with foreign counsel. Join us as we explore strategies to enhance cultural competency and optimize collaboration to achieve favorable outcomes in trademark cases spanning across borders. Lunch will be provided and the event is free for INTA members. Your expertise and perspectives will undoubtedly enrich our dialogue, making this event invaluable for all participants.

For more information and to register, click this link.

On March 4, the Federal Circuit, heard oral arguments for Celanese Int’l. v ITC, 22-1827 (Fed. Cir. 2024), a case that may reshape the dynamics between trade secrets and patent rights.

The Core Issue at Hand

This case centers around the America Invents Act (AIA) and whether a product’s prior sale by the patent applicant can disqualify the patenting of the method used to produce said product.

Case Background

Celanese perfected a novel method for producing acesulfame potassium (Ace-K), a synthetic sweetener. Opting to keep this process confidential, Celanese sold Ace-K for several years. Plot twist! They then filed for a patent more than a year after Ace-K hit the market.

Here’s where the story gets sweeter! Anhui Jinhe, a rival company, began importing Ace-K into the U.S., prompting Celanese to accuse Jinhe of infringing on their patent at the International Trade Commission (ITC). Jinhe contended that Celanese’s patent claims were invalid under the AIA’s “on-sale bar” rule, arguing that Celanese had already sold Ace-K produced by the disputed process over a year prior to their patent application. The ITC sided with Jinhe, asserting that a product’s sale made through a confidential process constitutes an “on sale” event under the statute, thus nullifying subsequent patent claims for that process. Celanese challenged this decision, sparking the current appeal.

Potential Consequences of the Case

Traditionally, inventors had to choose between patenting a new process or keeping it a trade secret. The “on-sale bar” served as a mechanism to prevent inventors from benefiting commercially from a secret invention for years before seeking a patent monopoly. However, this case challenges the interpretation of what it means for an invention to be “on sale” when the process itself is not directly marketed or disclosed.

Arguments from Celanese

Celanese argues that the AIA revises the pre-AIA rule, emphasizing the “claimed invention” rather than the “invention” at large, which should prompt a reevaluation of Federal Circuit precedent. They assert that their interpretation encourages the disclosure of trade secrets without unfairly extending exclusive rights.

Counterarguments from the ITC and Jinhe

In contrast, the ITC and Jinhe argue that the AIA did not alter the definition of “on sale.” They contend that Celanese’s interpretation is overly narrow and that the established pre-AIA rule should apply, preventing patentees from extending their monopolies through delayed patent applications on previously used secret processes.

Conclusion

This case is a sweet reminder of the intricate dance between protecting innovations and promoting fair competition. For those in industries dependent on trade secrets, such as pharmaceuticals, chemicals, and semiconductors, this case is crucial to watch, signaling possible shifts in how inventions are protected in the future. We’ll post an update when the court makes its ruling. The outcome may be the key ingredient to ensuring your inventions remain sweet and secure.