State regulators recently issued long-awaited draft permanent regulations for California’s cannabis industry, including some changes that could have an immediate impact on license-seekers and others that will shape the industry for many years to come.

Once the draft permanent regulations become law, they will replace the “emergency” rules that have governed the state’s cannabis industry since November 2017. A 45-day comment period kicked off Friday, during which the three state agencies overseeing legalized cannabis will consider public input and possible modifications before endorsing final rules.

While some recently-revealed changes to the draft permanent regulations are merely refinements of earlier provisions, others are new. For instance, the state will end the practice of  issuing 90-day temporary cannabis licenses on December 31, 2018, placing a hard deadline on many operators who still are far from obtaining their standard licenses. This means that all temporary licenses will expire by the end of March 2019 and businesses without a standard licensed will have to shut down.

A short list of other highlights is as follows:

• License transfer through ownership change: As part of a 100% business ownership change, the Bureau of Cannabis Control (regulating distributors, testing labs, and microbusinesses), will prohibit a purchaser from operating the company it buys until a new license application has been approved by the Bureau. This rule could cause business interruption as the new owner awaits the Bureau’s application review. The Dept. of Food and Agriculture (cultivation) and the Dept. of Public Health (manufacturing) each have separate and somewhat less onerous rules on this issue.
• Expanded delivery services: Previous drafts stated that cities could not stop delivery services from using public roads. The permanent regulations clarify that “a delivery employee may deliver to any jurisdiction within the State of California.” This modification addresses the interpretation by some city attorneys that cities could ban deliveries within their limits, and at the same time, not impede the use of public roads.
• CEQA: All of the relevant state regulatory agencies clarified that they will require applicants to provide evidence that their operations comply with the California Environmental Quality Act or that they are exempt from the Act. If neither can be shown, the applicant must provide information to enable an agency to determine the appropriate level of environmental review. This could trigger expensive and time consuming studies about an operator’s environmental impacts and mitigations.
• Still no one-acre cap per grower: A much-touted restriction to protect small cultivators was removed in the drafting of emergency regulations back in 2017, generating a hue and cry from small farmers and a lawsuit by the California Growers Association. But, to no avail thus far. The draft permanent regulations do not reinstate the one-acre cap.

Other important changes can be found in the draft regulations, including the Bureau’s 136 pages of rules, the Department of Health’s 111-page draft and the Department of Food and Agriculture’s 68-page document. They, no doubt, will make for interesting discussions at public hearings over the next six weeks at ten locations across the state.

On May 11, 2018, the California Department of Tax and Fee Administration (CDTFA) released its cannabis tax revenue numbers for the first quarter of 2018. These numbers fall short of the high expectations of industry analysts and the state. The CDTFA reports that it has collected a total of $60.9 million from licensed cannabis operators in Q1. This amount includes the state’s cultivation, excise and sales taxes, but does not include local tax revenue collected by cities or counties. Breaking it down a bit further, the excise tax generated $32 million, the cultivation tax brought in a mere $1.6 million, and the sales tax generated $27.3 million. Medicinal cannabis sales are exempt from sales tax if the purchaser holds a valid Medical Marijuana Identification card.

In addition to regulation and the elimination of the black market, the promise of tax revenues  was a major force behind the passage of Prop 64 back in 2016. The governor’s budget proposal had predicted $175 million in revenue in the first six months of 2018, which has proven to be optimistic based on the first quarter results. Two prime culprits for the tax shortfall may be suppressed sales volumes due to competition from healthy gray and black markets and fewer tax paying operators due to widespread local government bans on commercial cannabis activity and major delays in those jurisdictions that are allowing commercial cannabis.

In addition to competing with leaner gray and black market competitors, compliant operators face strict zoning requirements, slow and reticent local permitting bodies, and moratoriums on commercial cannabis activity. These obstacles result in fewer regulated operators, fewer sales, and fewer tax dollars. The expected tax revenue will only come if the cannabis industry is able to launch at scale and thrive. Imposing high taxes on a fledgling industry, much of it still emerging from the gray and black markets, is not an ideal way to encourage transitioning and new operators to jump through the numerous hoops set up by state and local governments. Local prohibitions on commercial cannabis exist in 70-80% of local jurisdictions. This means that operators are flooding those few jurisdictions that are permitting commercial cannabis activity with applications, resulting in delays.

The CDTFA’s report may have already put a damper on AB 3157, a bill  currently in committee that, if passed, would reduce the excise tax to 11% and eliminate the cultivation tax until June 2021. A recent addition to the bill allows the Legislature to restore the excise tax rate to 15% if the revenues collected from the excise tax are “insufficient to adequately fund the reasonable regulatory costs” outlined in the Revenue and Taxation Code. This language seriously weakens AB 3157 and puts a significant amount of pressure on a brand new industry.

It was only a matter of time.

THE “GOOD OLD DAYS” BEFORE DISPARAGING, VULGAR AND SCANDALOUS TRADEMARKS

For seventy years the United States Patent and Trademark Office (USPTO) refused to register marks that consisted of “immoral, deceptive, or scandalous matter; or matter which may disparage…..” citing § 2(a) of the Lanham Act.

Last June the Supreme Court struck down section 2(a)’s prohibition of disparaging marks and the other shoe just dropped when the Federal Circuit struck down its prohibition of vulgar, immoral or scandalous marks, allowing someone to register the mark FUCT.

The Slants Crush § 2(a)’s Prohibition of Disparaging Marks 

In 2010, Simon Shiao Tam, lead singer of the Oregon based Asian American rock band, sought to disarm the “toxic language and symbols” associated with the term “slants” by registering the mark “THE SLANTS” for the band.  The USPTO found the term disparaging to people of Asian descent and refused to register the mark under § 2(a).  Tam appealed, the Trademark Trial and Appeal (TTTBA) affirmed, Tam appealed, the Federal District Court initially affirmed the TTTBA’s decision, but later decided on its own to grant en banc review and reversed, finding that § 2(a) violated the First Amendment.  The USPTO still refused to register the mark and the Supreme Court granted certiorari.  In June 2017, the Supreme Court affirmed the Federal Circuit Court, holding that the disparagement clause of § 2(a) “violates the Free Speech Clause of the First Amendment.”

The Slants decision effectively rescued the Washington Redskins’ trademarks.  In 2014, the TTTBA decided to cancel the team’s registered trademarks, finding the term “Redskins” disparaging.  The team appealed to District Court, which affirmed the TTTBA’s decision, the team appealed to the Fourth Circuit and while the matter was pending, the Supreme Court issued its Slants decision.  Early this year the Fourth Circuit  reversed and remanded the district court, effectively ordering that the team’s marks be reinstated.

The Federal Circuit Orders USPTO to Register FUCT Mark, Striking Down Section 2(a)’s Prohibition of Vulgar, Immoral and Scandalous Marks 

In 2011, Erik Brunetti sought to register the mark FUCT for his clothing brand. The USPTO refused to register the mark, finding that “ ‘FUCT’ is the past tense of the verb ‘fuck,’ a vulgar word, and is therefore scandalous.”  Brunetti appealed to the TTAB.  The TTAB noted that Brunetti “used the mark in the context of ‘strong, and often explicit, sexual imagery that objectifies women and offers degrading examples of extreme misogyny’” and held the mark was “vulgar and therefore un registerable under section 2(a) of the Lanham Act.”

Brunettti appealed the TTAB decision to the Federal Circuit, which heard the appeal after the Supreme Court issued its Slants decision. In a ruling that rivals a South Park episode for the number of swear words, the Federal Circuit agreed with the TTAB that the mark FUCT is vulgar, but followed the Supreme Court’s Slants decision, holding that “the bar in § 2(a) against immoral or scandalous marks is unconstitutional because it violates the First Amendment.”   The Court rejected the USPTO’s argument, similar to its argument in the Slants case, that trademark registration is a government subsidiary, which allows the government some leeway in regulating speech.  The Court noted that “[t]here are countless songs with vulgar lyrics, blasphemous images, scandalous books and paintings, all of which are protectable under federal [copyright] law” and reversed the TTAB’s holding that the mark FUCT “is unregisterable under section 2(a).”

What’s Next for Vulgar and Scandalous Trademarks?

We are likely to see a race to the bottom. Much like shock jocks Howard Stern and Don Imus seek to increase market share with outlandish speech, some business owners are likely to see some value in garnering attention via shocking, vulgar and/or scandalous trademarks, and the USPTO will have no choice but to register those marks.

It was only a matter of time.

THE “GOOD OLD DAYS” BEFORE DISPARAGING, VULGAR AND SCANDALOUS TRADEMARKS

For seventy years the United States Patent and Trademark Office (USPTO) refused to register marks that consisted of “immoral, deceptive, or scandalous matter; or matter which may disparage…..” citing § 2(a) of the Lanham Act.

Last June the Supreme Court struck down section 2(a)’s prohibition of disparaging marks and the other shoe just dropped when the Federal Circuit struck down its prohibition of vulgar, immoral or scandalous marks, allowing someone to register the mark FUCT.

The Slants Crush § 2(a)’s Prohibition of Disparaging Marks 

In 2010, Simon Shiao Tam, lead singer of the Oregon based Asian American rock band, sought to disarm the “toxic language and symbols” associated with the term “slants” by registering the mark “THE SLANTS” for the band.  The USPTO found the term disparaging to people of Asian descent and refused to register the mark under § 2(a).  Tam appealed, the Trademark Trial and Appeal (TTTBA) affirmed, Tam appealed, the Federal District Court initially affirmed the TTTBA’s decision, but later decided on its own to grant en banc review and reversed, finding that § 2(a) violated the First Amendment.  The USPTO still refused to register the mark and the Supreme Court granted certiorari.  In June 2017, the Supreme Court affirmed the Federal Circuit Court, holding that the disparagement clause of § 2(a) “violates the Free Speech Clause of the First Amendment.”

The Slants decision effectively rescued the Washington Redskins’ trademarks.  In 2014, the TTTBA decided to cancel the team’s registered trademarks, finding the term “Redskins” disparaging.  The team appealed to District Court, which affirmed the TTTBA’s decision, the team appealed to the Fourth Circuit and while the matter was pending, the Supreme Court issued its Slants decision.  Early this year the Fourth Circuit  reversed and remanded the district court, effectively ordering that the team’s marks be reinstated.

The Federal Circuit Orders USPTO to Register FUCT Mark, Striking Down Section 2(a)’s Prohibition of Vulgar, Immoral and Scandalous Marks 

In 2011, Erik Brunetti sought to register the mark FUCT for his clothing brand. The USPTO refused to register the mark, finding that “ ‘FUCT’ is the past tense of the verb ‘fuck,’ a vulgar word, and is therefore scandalous.”  Brunetti appealed to the TTAB.  The TTAB noted that Brunetti “used the mark in the context of ‘strong, and often explicit, sexual imagery that objectifies women and offers degrading examples of extreme misogyny’” and held the mark was “vulgar and therefore un registerable under section 2(a) of the Lanham Act.”

Brunettti appealed the TTAB decision to the Federal Circuit, which heard the appeal after the Supreme Court issued its Slants decision. In a ruling that rivals a South Park episode for the number of swear words, the Federal Circuit agreed with the TTAB that the mark FUCT is vulgar, but followed the Supreme Court’s Slants decision, holding that “the bar in § 2(a) against immoral or scandalous marks is unconstitutional because it violates the First Amendment.”   The Court rejected the USPTO’s argument, similar to its argument in the Slants case, that trademark registration is a government subsidiary, which allows the government some leeway in regulating speech.  The Court noted that “[t]here are countless songs with vulgar lyrics, blasphemous images, scandalous books and paintings, all of which are protectable under federal [copyright] law” and reversed the TTAB’s holding that the mark FUCT “is unregisterable under section 2(a).”

What’s Next for Vulgar and Scandalous Trademarks?

We are likely to see a race to the bottom. Much like shock jocks Howard Stern and Don Imus seek to increase market share with outlandish speech, some business owners are likely to see some value in garnering attention via shocking, vulgar and/or scandalous trademarks, and the USPTO will have no choice but to register those marks.

Under the American Rule “each litigant pays his own expense, win or lose, unless a statute or contract provides otherwise.” But recently the United States Patent and Trademark Office (USPTO) has sought to flip the American Rule by seeking to recover its attorney’s fees even when it loses.

EXPENSES UNDER THE LANHAM ACT AND PATENT ACT

Parties seeking to register a trademark (symbols or words representing a company, product or service) or a patent (exclusive right to use of invention) must register their applications with the USPTO. If the USPTO rejects their applications, the parties can appeal to their local federal district court or the Federal Circuit Court of Appeals. The Lanham Act, which governs trademarks, provides that  “all the expenses of the proceeding shall be paid by the party bringing the case…” 15 U.S.C. 107(b)(3); The Patent Act, which governs patent applications, provides that “[a]ll the expenses of the proceedings shall be paid by the applicant. 35 U.S.C §145.

Historically, the USPTO only sought reimbursement of costs (travel, expert fees, etc.) borne from opposing these trademark or patent appeals, but in 2013, the USPTO began seeking reimbursement of its attorney’s fee as well.

WHEN YOU LOSE, YOU LOSE

In Nankwest, Inc. v. Matal,(E.D. Virginia 2016) 162 F. Supp.3d 540, the applicant challenged the USPTO’s decision rejecting its patent application.  The trial court partially accepted and partially rejected the challenge to the USPTO’s decision. The USPTO sought to recover its attorney’s fees along with its other costs, but the trial court rejected the USPTO’s request, finding that such fees are “authorized only when there is a specific and explicit provision for the allowance of attorney’s fees under the selected statute.” Id. at 543.

The USPTO appealed to the Federal Circuit, which reversed the trial court, Nankwest, Inc. v. Matal  (Fed. Cir. 2017) 860 F.3d. 1352., concluding that “Given the Supreme Court’s construction of ‘expenses,’ the guidance dictionary and treatises provide on the term, and the context in which Congress applied it, we conclude the term ‘expenses’ includes the USPTO’s attorney’s fees under § 145.” Id. at 1358.  Two months later the entire Federal Circuit vacated the panel’s decision and set the matter for en banc review. So stay tuned on the final word from the Federal Circuit.

EVEN WHEN YOU WIN, YOU LOSE

In August of this year, in Booking.com B.V. v. Matal (E.D. Virginia 2017) 2017 WL 3425167 a trademark applicant appealed the USPTO’s refusal to register four trademark applications. The Court granted summary judgement for the applicant for two of the four marks and remanded consideration as to the other two marks back to the USPTO. Despite “losing” the appeal, the USPTO filed a motion for expenses, including its attorney’s fees.  In October, the court granted the USPTO’s attorney’s fees, 2017 WL 4853755. The Court noted that the issue was subject to en banc review by the Federal Circuit, but held that it was bound by Fourth Circuit precedent that “compels the Court to find that [the USPTO’s] attorneys’ fees are recoverable under §1071(b)(3).”

Ultimately it appears the Supreme Court will need to determine whether the statutory term “expenses” includes the USPTO’s attorneys’ fees. Until then, to quote the Grateful Dead, trademark and patent applicants “can’t win for losing.”

Beginning on January 1, 2018, numerous California cities will begin issuing licenses for recreational marijuana businesses.  To help you better understand the application process for the City of San Francisco, we set forth the following update from San Francisco’s Office of Cannabis.  If you have any questions, please do not hesitate to contact the experienced attorneys at Wendel Rosen who can help you navigate the application process.

Non-MCD cannabis businesses operating in San Francisco must register by November 30, 2017, to be able to apply for 2018 permits.

Medical cannabis dispensaries (MCDs) with an Article 33 permit do not need to register now. But any cultivators, distributors and manufacturers who work with permitted MCDs must register.

Most cannabis businesses who miss the November 30 deadline will have to stop operating and wait until 2019 to apply again.

We know many cannabis businesses are changing right now. In most cases, business registering with the Office of Cannabis will have a chance to update business name, management structure and address after this initial registration period.

If you have already registered, pass this email on to other cannabis businesses. 

Help us spread the word. Ask your contacts in the industry to register by November 30, 2017.

Pop culture fan conventions are huge in the new millennium.  “Cons,” as they are often called, have sprung up all over the country and grown into a massive cultural phenomenon.  There are Cons for comics, movie and television franchises, toys and much more.  By its own reckoning, Comic-Con boasts more than 130,000 attendees a year.  Hit television shows like the Big Bang Theory celebrate Cons as part of hip “nerd culture.”

However, there is a less seemly side of Cons—IP infringement.  It’s easy to find unlicensed fan art for sale and knock-off products being sold without the proper licensing.  Owners of big IP franchises like comic book characters and toy lines may have tolerated much of this activity in the past, but some are taking notice.

For example, in recent years, the LEGO Group has cracked down on enforcement of its trademarks and other IP being used by fan Cons and fan clubs.  It has promulgated guidance that has addressed things like limitations on sales of Con t-shirts bearing LEGO Group IP assets like the LEGO^® name and logo.  In fact, some LEGO^® fan clubs have had to change their names due to new IP guidelines issued by the company in the last couple of years.  Arguably, the LEGO Group has charted a reasonable approach, balancing protection of its IP while  not entirely prohibiting or discouraging use of its IP assets in many permissible ways by fans; other companies can be more or less aggressive.

Con vendors selling “fan art,” should be aware of the risk of a claim for IP infringement.  Fan art like “original” artwork depicting copyrighted characters, fan websites or fan novels/stories can all implicate IP infringement.  In Warner Bros. Entertainment Inc. v. RDR Books, the court found that fan art in the form of an encyclopedia of “fictional facts” regarding the Harry Potter universe—which appropriated plotlines, summaries of scenes or key events and language used in the novels—established a case of copyright infringement.  See Warner Bros. Entertainment Inc. v. RDR Books (S.D.N.Y. 2008) 575 F.Supp.2d 513, 538.  The court engaged in an extensive “fair use” analysis and rejected that defense.  Id. at 551.  Among other things, the court observed that the “actual use of the copyrighted works is not consistently transformative.”  Id.

Fan art quite often can also be characterized as a “derivative work,” and the law of copyright protects the copyright holders right to control the creation of derivative works (i.e. works that merely change an original work into a new mode of presentation like the novelization of a movie).  See Castle Rock Entertainment, Inc. v. Carol Publishing Group, Inc. (2d Cir. 1998) 150 F.3d 132, 143.

As explained in earlier posts, the law of fair use is complicated and requires a careful review and evaluation of numerous factors, such as purpose and character of the use and the effect of the use upon the potential market for or value of the copyrighted work.  (See “Google’s Effort to Digitize Millions of Books” and “Using ‘Borrowed’ Images in Your Blog”).

The step by step questions laid out in my post “Using ‘Borrowed’ Images in Your Blog” are just as apt as regards to fan art, as many of the same principles apply.  The application of the fair use factors is a case by case determination, but broadly speaking much fan art does not really amount to parody, critical commentary or substantial transformation so as to fall into the realm of fair use.  Though certainly some will.  Moreover, because supposedly “everyone does it” or the alleged infringer is a small time operation making little profit, contrary to some popular sentiment, does not, in and of itself, mean the fan art constitutes fair use.

Thus, some fan art at Cons treads on very shaky grounds and Con goers may want to be wary of supporting non-authorized works that violate the IP rights of the content creators whose works have given rise to these conventions that we enjoy.

Beloved burger chain In-N-Out Burger, home of not-so-secret menu items and “animal style” fries, has sued burger competitor Smashburger, claiming that Smashburger’s new “Triple Double” burger infringes on In-N-Out’s “Double-Double” and “Triple Triple” trademarks.

Burger aficionados and dabblers alike are probably well-aware of In-N-Out’s “Double-Double” burgers, which come with two meat patties and two slices of cheese.  According to In-N-Out’s complaint, Smashburger recently began marketing a “Triple Double” burger, which contains two meat patties and three slices of cheese.  In-N-Out alleges that it has had registered trademarks on the mark “Double-Double” since 1975, and “Triple Triple” since 1990 – and further, its customers frequently mix and match the terms to create customized orders, including a “Triple Double.”  Smashburger apparently filed applications with the USPTO in November 2016 to trademark the term “Triple Double.”

In-N-Out claims that Smashburger’s use of the mark “Triple Double” has damaged In-N-Out because consumers are and will be confused and misled into believing that In-N-Out is somehow affiliated with Smashburger, and In-N-Out will suffer injuries to its reputation and goodwill.  Both burger chains have locations in southern California, where In-N-Out’s lawsuit was filed.

If the case were to go to trial, prospective jurors should consider demanding a blind taste test to determine whether there is, in fact, a likelihood of confusion between In-N-Out’s Double-Double and Smashburger’s Triple Double.

[Note: A previous version of this article ran on Wendel Rosen’s cannabis industry blog at www.calcannabislawblog.com on June 8, 2017.]

In June 2017, the California Assembly passed California AB 64, an omnibus bill regarding medical and recreational marijuana, and the bill is currently working its way through the California Senate committee process.

Federal cannabis trademark registration appears unlikely for the foreseeable future. The California cannabis industry and intellectual property lawyers are anticipating a trademark filing frenzy on January 1, 2018, when the California Secretary of State is scheduled to begin accepting trademark applications for cannabis goods and services.

California Currently Follows Federal Lead on Cannabis Trademarks

Under current law, the California Secretary of State will only register marks that are “substantially consistent with the federal system of trademark registration and protection under the Trademark Act of 1946 (15 U.S.C. §1051 et seq.) as amended.  To that end, the construction given the federal act should be examined as non-binding authority for interpreting and construing this chapter.” Cal. Bus. & Prof. Code §14272.

The United States Patent and Trademark Office (“USPTO”) will only register trademarks relating to commerce “which may lawfully be regulated by Congress.” 15 U.S.C. §1127, and specifically the USPTO requires that “use of a mark in commerce must be lawful use to be the basis for federal registration of the mark.”  Trademark Manual of Examining Procedure §907.

AB 64 Untethers California from the USPTO Limitations

The Legislative Analyst’s Digest for AB 64 identifies the conflict between California and Federal law relating to marijuana’s legality, and clarifies AB 64’s intended effect on marijuana trademarks:

(6) Existing law, the Model State Trademark Law, provides for the registration of trademarks and service marks with the Secretary of State and requires the classification of goods and services for those purposes to conform to the classifications adopted by the United States Patent and Trademark Office.

This bill, for purposes of marks for which a certificate of registration is issued on or after January 1, 2018, would, notwithstanding those provisions, authorize the use of specified classifications for marks related to cannabis, including medicinal cannabis goods and services that are lawfully in commerce under state law in the State of California.  (Emphasis added).

Specifically, Section 2(a) of AB 64 adds Section 14235.5 to the Business and Professions Code, which will establish two new cannabis trademark and service mark classifications:

Classification “500 for goods that are cannabis or cannabis products, including medicinal cannabis or medicinal cannabis products;” and

Classification “501 for services related to cannabis or cannabis products, including medicinal cannabis or medicinal cannabis products.”

Countdown to January 1, 2018

In plain English, on January 1, 2018, cannabis businesses will finally be able to register trademarks and service marks for cannabis goods and services, including trademarks for specific cannabis strains, assuming the proposed marks satisfy the other registration requirements (i.e. distinctiveness, lack of likelihood of confusion with existing registered marks, etc.)

Given that California is the most populous state, that the California cannabis market is projected to reach $6.5 billion by 2020, and that it is currently impossible to obtain a nationwide trademark for cannabis products, the California Secretary of State should anticipate receiving a tsunami of cannabis related trademark applications on January 2, 2018 (January 1 is an official State holiday).

Unlike the USPTO, which does not require an applicant to have used a mark in order to file an application (though proof of use is eventually needed for registration), California requires proof of actual use in commerce to file and register a trademark.  Cal. Bus. & Prof. Code 14202(h).  While existing cannabis trademarks already used in California may  already have common law trademark protection, registration with the Secretary of State would confer statewide rights and additional remedies.  Therefore, smart cannabusinesses should begin finding and using marks that will ultimately qualify for well in advance of the January registration date.

* A Californian cannabusiness would have zero chance of obtaining Acapulco Gold trademark because it would be geographically misleading and because the strain’s name is already widely used.

[This post is part 3 of a 3 part IP Basics Series]

In a recent series of IP Basics: Copyrights, Trademarks and Trade Secrets, Oh My! and What are “Trade Dress” and “Trade Secrets?”, we considered a number of different types of intellectual property (IP).  In this post, we will discuss those ubiquitous IP related symbols we see on products (and other works) and what they really mean.

The Copyright Symbol.  Use of the copyright symbol Ⓒ is regulated by federal copyright law.  For works first published after March 1, 1989, a formal copyright notice is optional.  17 U.S.C.A. § 401(a).  There are several formats for this notice proscribed by federal statute.  Federal law specifies that the notice may be in any one of the following forms:  (1) the symbol Ⓒ (the letter C in a circle), (2) the word “Copyright” or (3) the abbreviation “Copr.”  17 U.S.C.A. § 401(b)(1).

While not required, including a copyright notice on a published work can negate an infringer’s ability to rely on the “innocent infringement” defense to avoid the imposition of certain damages.  17 U.S.C.A. §§ 401(d) and 402(d).

A copyright notice was required for works published before March 1, 1989 (the effective date, as to the United States, of the international copyright treaty known as the Berne Convention).  General publication before that date without a copyright notice could cause a work to enter the public domain if the copyright owner failed to cure the omission of the mandatory copyright notice.  There are, however, some limited circumstances in which the omission of the copyright notice from authorized copies distributed by the copyright owner does not invalidate the copyright in a work.  For example, a copyright is not lost if an otherwise required copyright notice was left off in violation of an express written requirement contained in the owner’s authorization of the public distribution of the work.  17 U.S.C.A. § 405(a)(3).

The Trademark Symbol.  Where a trademark is not registered, those claiming a protectable trademark or servicemark can make use of the “TM” and “SM” symbols.   The former signals a claimed trademark, while the latter is used with servicemarks (a servicemark is a trademark used to identify a service rather than a product).  No specific federal statutes authorize the use of the “TM” symbol, limits its use, or states definitively what it does or does not convey to the public.  Southern Snow Manufacturing Co. v. Snow Wizard Holdings, Inc. (E.D. La. 2011) 829 F.Supp.2d 437, 452 (“Southern Snow”).  Historically, however, the designation has been used as a way of alerting the public to a claim of ownership of a trademark.  Southern Snow, at p. 452.  Such a claim does not necessarily equate with any actual, protectable rights.  “…[T]he TM symbol does not mean that the party has trademark rights in the name or can ensure that the mark is capable of serving as a trademark…”  Southern Snow, at p. 453-454.

However, using the “TM” and “SM” symbols can help establish a trademark.  The courts may consider such use as evidence demonstrating that a name or mark is being used in the sense of a trademark or servicemark to reflect the origin of the goods or services, a factor in the overall determination of the existence of trademark protection.  The fact that no symbol is used to designate an alleged trademark is evidence that the mark is not being used as a trademark.  T.A.D. Avanti, Inc. v. Phone-Mate, Inc. (C.D. Cal. 1978) 1978 WL 21444, *6.