IP Blog

Intellectual Property Blog

Between Innovation and Infringement: Cases Against OpenAI’s ChatGPT Could Establish Legal Precedent for Generative AI

OpenAI, the organization behind the ChatGPT platform, finds itself amidst a series of lawsuits centered on allegations of copyright infringement. For context, ChatGPT operates as a free-to-use generative AI model trained on vast amounts of text data from the internet. This extensive training allows it to generate human-like text based on user prompt inputs. Since its public release in late 2022, its adoption has skyrocketed, with the platform now boasting over 1.5 billion monthly visits.

That said, the sources of its training data, potentially including copyrighted works, have become a point of contention. As of now, there are just a few filed lawsuits that highlight the intricate relationship between AI training data and copyrighted content.

The case of Authors v. OpenAI serves as a prime example. Here, the plaintiffs (a consortium of authors) assert that OpenAI’s models, in their training phase, consumed copyrighted books, articles, and other literary works that, despite being publicly accessible, remain under copyright protection. Their contention essentially is that such training equips the models to either mirror original content or produce derivative works. In fact, the plaintiffs have described instances where the models exhibited this behavior. They argue that this erodes their creations’ intrinsic value and robs them of due royalties. The lawsuit, grounded on theories of direct and vicarious copyright infringement, negligence, and state unfair competition law violations, seeks monetary damages and an injunction against OpenAI’s continued use or distribution of models trained on copyrighted content.

Parallel lawsuits, like Sarah Silverman et al. v. OpenAI and Paul Tremblay & Mona Awad v. OpenAI, echo similar complaints. Media giant, The New York Times, is also contemplating legal measures against OpenAI. In a broader context, other AI entities are facing litigation for generative AI models related to visuals (not just text generation), such as in Getty Images v. Stability AI (in the High Court of Justice in London).

While generative AI, in its foundational concepts, has been around for several decades its rapid development and accessibility to the general public are recent phenomena. As a result, the legal landscape is still in its infancy, and legal doctrine sparse. While rooted in longstanding law, the cases at hand are trailblazers in their own right, set to define the legal boundaries of the generative AI frontier.

Copyright in the Age of AI: U.S. Copyright Office’s Call for Insight

The rapid advancement of artificial intelligence (AI) and its integration into everyday use in modern society has brought to the forefront a multitude of complex issues, especially those concerning copyright law. The relationship between AI and copyright protection is still being unraveled, with the most recent advancements coming by way of (1) the U.S. Copyright Office’s March 15, 2023 guidance indicating works generated with the aid of AI may be eligible for copyright protection so long as the work involves sufficient human authorship and (2) the United States District Court for the District of Columbia’s August 18, 2023 decision in Thaler v. Perlmutter to uphold a finding from the U.S. Copyright Office emphasizing that works authored solely by AI are not eligible for protection under existing copyright laws.

In light of the Thaler decision, the U.S. Copyright Office issued a notice of inquiry (the “Notice”) on August 30, 2023—thereby inviting the public to comment on issues that can be found at the intersection of copyright and AI, such as “the use of copyrighted works to train AI models, the appropriate levels of transparency and disclosure with respect to the use of copyrighted works, and the legal status of AI-generated outputs.” Written comments in response to the Notice are due by 11:59 PM on October 18, 2023, with written reply comments acceptable until 11:59 PM on November 15, 2023.

 

Firm Wins Trademark Case Against MONSTER ENERGY®

 

The Firm successfully defended a monster of a trademark case filed by Monster Energy Corp. against Firm client, SS Vape Brands, Inc.  Monster Energy is one of the world’s largest beverage companies.  SS Vape sells electronic cigarette products.

The administrative litigation before the Trademark Trial and Appeal Board (“TTAB”) of the U.S. Patent and Trademark Office involved an opposition against SS Vape’s U.S. trademark application for the mark ICE MONSTER on e-cigarette liquid.  TTAB cases proceed much like litigation in the U.S. District Courts in accordance with the Federal Rules of Civil Procedure, though final decisions are rendered by a panel of administrative law judges. Monster Energy alleged that it would be damaged by the grant of a registration to SS Vape for the ICE MONSTER mark on the basis of a likelihood of confusion with the MONSTER ENERGY marks, including several MOSTER variations, spanning dozens of prior registrations extending from energy drinks to nutritional supplements in liquid form and collateral merchandise.

Represented by Firm Partner, Meredith Frank Mendez, SS Vape denied that its ICE MONSTER mark is likely to cause confusion.  One of its main arguments was that the parties’ goods are not related, so consumers will not perceive that the goods emanate from the same source or that they are associated or affiliated with a single source.  After years of protracted litigation, the parties submitted trial briefs and extensive evidence, which the TTAB considered in a 76-page opinion dismissing Monster Energy’s case.  Among other things, the decision held:

“The fact that the goods are not related and that there have been no reported instances of confusion carry great weight in our analysis. See Citigroup, 98 USPQ2d at 1261 (varying weights may be assigned to each DuPont factor depending on the evidence presented); In re Shell Oil Co., 992 F.2d 1204, 26 USPQ2d 1687, 1688 (Fed. Cir. 1993) (“[T]he various evidentiary factors may play more or less weighty roles in any particular determination.”). We find, therefore, that Applicant’s mark ICE MONSTER and design for “electronic cigarette liquid (e-liquid) comprised of flavorings in liquid form, other than essential oils, used to refill electronic cigarette cartridges” is not likely to cause confusion with Opposer’s MONSTER and MONSTER ENERGY marks for the goods and services in connection which Opposer has registered and uses those marks.

The full decision of the TTAB can be accessed here.  Ms. Mendez acted as lead counsel with assistance from Associates John Eagan and Cleo Suero.

D.C. Court of Appeals Rules Against Copyright Office’s Mandatory Deposit Requirement

The U.S. Court of Appeals for the District of Columbia has delivered a significant ruling in the case of Valancourt Books v. Garland. The court determined that the Copyright Office’s mandatory deposit requirement (17 U.S.C. §407) is an unconstitutional taking.

For years, the mandatory deposit requirement has been a cornerstone of the Copyright Office’s operations. It mandates that two copies of every copyrighted work be deposited with the Copyright Office, ensuring a comprehensive record of all copyrighted materials. However, Valancourt Books challenged this requirement, arguing that it amounted to an unconstitutional taking without just compensation.

The Court of Appeals sided with Valancourt Books, stating that the mandatory deposit requirement did indeed impinge upon the rights of copyright holders. This decision underscores the importance of balancing the needs of public records with the rights of individual copyright holders.

In essence, the removal of the mandatory deposit requirement could lead to a reduction in costs for those filing for or using the Copyright Office for services. Without the need to produce and send physical copies of copyrighted works, copyright holders save on production and shipping costs. Moreover, this ruling may prompt reevaluating other practices within the Copyright Office and the broader realm of copyright law.

In conclusion, the Valancourt Books v. Garland case ruling is more than just a legal decision. It’s a reflection of the evolving nature of copyright practices and the need to strike a balance between public interest and individual rights.

The decision can be read here: Valancourt Books v. Garland, No. 21-5203, U.S. Court of Appeals for the District of Columbia Circuit (2023).

11th Circuit Finding: Non-Exclusive Licensee Can Bring Lanham Claim Even Though Licensing Agreement was Silent on Enforcement

The 11th Circuit recently addressed the issue of whether a trademark licensee [D.H. Pace Company, Inc. (“Pace”)] could file suit against a third party [Overhead Garage Door (“OGD”)] for unfair competition under the Lanham Act, when the underlying licensing agreement did not expressly authorize the plaintiff to do so.  Although the licensing agreement did identify the terms and conditions for Pace’s use of the licensor’s trademarks and trade names, the agreement was silent on trademark enforcement matters or the rights to sue for infringement.

The district court concluded that the licensing agreement was a “contractual bar” to Pace filing suit, as no affirmative rights to sue were granted to the licensee (Pace).  Furthermore, the district court held that any rights that Pace did have were derived from the licensing agreement, and because maintaining affirmative claims was not one of them, OGD’s summary judgment motion was granted as a matter of law.

On appeal, the Eleventh Circuit reversed, and found that because the licensing agreement did not pose a contractual bar (and was otherwise silent) on Pace’s ability to sue, Pace was free to bring a Lanham Act claim.  Additionally, the Eleventh Circuit noted that Pace’s status as a non-exclusive licensee was of no moment, and cited with approval to numerous cases standing for the principle that nonexclusive licensees are free to bring suit under § 43(a).

The case is D.H. Pace Co. v. OGD Equip. Co., LLC, No. 22-10985, 2023 U.S. App. LEXIS 22102 (11th Cir. Aug. 22, 2023).

“TACO TUESDAY”: Spicy Showdown

In a press release issued on July 18, 2023, Taco John’s—a restaurant franchise famous for using the registered mark “TACO TUESDAY” (i.e., U.S. Registration No. 1,572,589) in connection with restaurant services—announced its intent to surrender its federal registration, thereby giving up benefits it accrued over the life of the nearly 45 year old registration. The registered mark, owned by Spicy Seasonings, LLC, was used primarily in connection with Taco John’s since 1989.

The dispute began on May 16, 2023, when Taco Bell filed its Petition to Cancel the mark “TACO TUESDAY” (i.e., TTAB Proceeding No. 92082333), mainly arguing that the phrase has become generic in connection with the identified services. A week after filing its Petition to Cancel “TACO TUESDAY,” Taco Bell took the dispute public, releasing a commercial with LeBron James wherein LeBron is “bleeped” in every instance of saying the phrase “Taco Tuesday.”

According to Taco John’s CEO, Jim Creel, Spicy Seasonings decided not to continue to defend the cancellation action in large part due to the ever-increasing attorneys’ fees. Rather than “paying millions of dollars to lawyers to defend [their] mark,” Spicy Seasonings has opted to surrender its registration for “TACO TUESDAY” and donate $40,000 to the non-profit organization Children of Restaurant Employees (CORE).

Patent Protection Prevails: CAFC Limits the Use of Prior Art to Invalidate Patents

On May 9, 2023, in a significant reversal of a previous Patent Trial and Appeal Board (PTAB) decision, the Court of Appeals for the Federal Circuit (CAFC) ruled in favor of pharmaceutical giant Sanofi-Aventis Deutschland GmbH (“Sanofi”), upholding the validity of its patent (i.e., U.S. Patent No. RE47,614) for a drug delivery device and methods of using the same.

The dispute first arose when Mylan Pharmaceuticals Inc. (“Mylan”) initiated an inter partes review (IPR) of Sanofi’s ‘614 patent, alleging all 18 claims of Sanofi’s patent were obvious. In support of its petition, Mylan claimed that several references—namely, Burren (U.S. Patent Application No. 2007/0021718), Venezia (U.S. Patent No. 2,882,901), and de Gennes (U.S. Patent No. 4,144,957)—taught the ‘614 Patent to one skilled in the art. Despite Sanofi arguing that these references were unrelated to its patent, the PTAB concluded the ’614 patent was invalid using the “analogous art test,” which allows for the consideration of inventions from similar, but not identical, fields as a basis to claim a patent is invalid.

In ruling for Sanofi on appeal, however, the CAFC found that the applicability of the analogous art test—which serves the purpose of examining “whether a reference can be considered as prior art to the challenged patent in the first place”—was limited, as Mylan “adopted [a] problem statement derived from Burren and then worked backward to relate that problem to the ‘614 patent.” Furthermore, the CAFC reasoned that in evaluating “whether a reference is analogous, [the court] consistently held that a patent challenger must compare the reference to the challenged patent.” (emphasis added). As such, the CAFC agreed with Sanofi that the burden of proof to prove the claims’ unpatentability impermissibly shifted from Mylan to Sanofi, and ruled Mylan did not meet the requisite burden to connect de Gennes to the ‘614 patent such that a finding of invalidation would be proper. Accordingly, the CAFC reversed the PTAB’s decision to invalidate the ‘614 patent.

The case is Sanofi-Aventis Deutschland GmbH v. Mylan Pharmaceuticals Inc. (Case No. 21-1981) in the United States Court of Appeals for the Federal Circuit. The decision can be found at the following link: https://cafc.uscourts.gov/opinions-orders/21-1981.OPINION.5-9-2023_2123775.pdf

Miami Heat Star Player Jimmy Butler Files Several Trademark Applications Amid the NBA Finals and Eastern Conference Finals

The National Basketball Association (NBA) Finals and Eastern Conference Finals have not stopped the Miami Heat’s 2023 MVP and fan favorite, Jimmy Butler, from adding to his trademark portfolio.

Through applicant ZS Endorsement, LLC on May 24, 2023 — between Games 4 and 5 of the Heat’s battle against the Boston Celtics to reach the NBA Finals — Butler filed intent-to-use Application Serial No. 98/010,313 for “HIMMY BUCKETS” in connection with various goods, including athletic apparel, drinkware, beer, and non-alcoholic beverages such as coffee, tea, soda, and seltzer water.

One week later, on the eve of Game 1 of the NBA Finals against the Denver Nuggets, Butler filed several more intent-to-use trademark applications aimed to protect his well-known nicknames. These new applications include Serial No. 98/022,214 for “PLAYOFF JIMMY,” Serial No. 98/022,285 for “HIMOTHY BUTLER,” and Serial No. 98/022,234 for “HIMMY BUTLER,” all in connection with the same athletic apparel, drinkware, beer, and non-alcoholic beverage goods listed above. Notably, Butler’s portfolio also includes Application No. 90/664,531 for “JIMMY BUCKETS” for athletic apparel and drinkware, which was allowed by the U.S. Patent and Trademark Office (USPTO) in 2021. These filings indicate that the Miami Heat star is likely planning to launch his own athletic clothing and beverage lines.

Butler currently has a total of twenty-four (24) active applications pending before the USPTO via ZS Endorsement, LLC. Many of these applications relate to his “BIG FACE” coffee brand, which Butler reportedly conceptualized during the pandemic while in the 2020 NBA Bubble.

USPTO Record for Application Serial No. 98/022,234 for “HIMMY BUTLER,” owned by ZS Endorsement, LLC

Striking a Chord: TTAB Rules Guitar-Shaped Hotel Trade Dress is Inherently Distinctive

On May 25, 2023, the Trademark Trial and Appeal Board (TTAB) reversed a refusal to register the Seminole Tribe of Florida’s (the “Tribe’s”) trade dress consisting of “a three-dimensional building in the shape of a guitar” (U.S. Application No. 87/890,892)—finding the trade dress to be “inherently distinctive” for casino services, hotel services, restaurant services, and bar services.

In ruling the trade dress was inherently distinctive for such services, the TTAB opined that although the examining attorney deemed the Tribe’s trade dress to be “nondistinctive [and] ambiguous” such that “acquired distinctiveness [would be] required before registration can be granted”—similar to that of Wal-Mart Stores, Inc. v. Samara Bros., Inc., 54 USPQ2d 1065 (2000)—the Tribe’s trade dress is “not a common design . . . is unique, and [is] not a mere refinement of a commonly-adopted and well-known form of ornamentation for” the aforementioned casino services, hotel services, restaurant services, and bar services. As such, the TTAB reasoned that under “the guidance of Two Pesos, Samara Bros., and In re Chippendales USA,” the Tribe’s trade dress is “’tertium quid’ that is akin to product packaging”—illustrating the trade dress as “of such a design that a buyer will immediately rely on it to differentiate the product from those competing manufacturers . . . .” Therefore, the TTAB reversed the refusal to register the Tribe’s trade dress, allowing the application to proceed to registration and obviating the need to rely on the Tribe’s previously-accepted claim of acquired distinctiveness under 15 U.S.C. § 1052(f).

The case is In re Seminole Tribe of Florida, 2023 USPQ2d 631 (TTAB 2023). The image above is provided in the TTAB’s Opinion, which can be found at the following link: https://ttabvue.uspto.gov/ttabvue/ttabvue-87890892-EXA-23.pdf.

SUPREME COURT ISSUES DECISION IN WARHOL CASE

The Supreme Court issued a decision today In a highly-followed case involving fair use defenses that were asserted by the Andy Warhol Foundation for Visual Arts. The Foundation asserted the defenses in a case that alleged that Andy Warhol’s use of photographs of the musician Prince infringed U.S. copyright laws. The original photographs were taken by professional photographer Lynn Goldsmith, the party alleging infringement with respect to the Warhol works. The Warhol Foundation argued that Warhol’s changes to the photographs were of a “transformative” nature, including because the Warhol works conveyed a different meaning or message, such that there was no infringement under a fair use defense.

The Supreme Court sided with the photographer on the fair use issues raised in the case. The Supreme Court’s opinion was authored by Associate Justice Sonia Sotomayor and six other Associate Justices joined in the opinion. A dissenting opinion was authored by Associate Justice Elena Kagan, who was joined by Chief Justice John Roberts.

The opinion can be found here: https://www.supremecourt.gov/opinions/22pdf/21-869_87ad.pdf.