{"id":23,"date":"2010-07-23T15:18:22","date_gmt":"2010-07-23T22:18:22","guid":{"rendered":"http:\/\/ipmetrics.net\/blog\/?p=23"},"modified":"2010-07-23T15:18:22","modified_gmt":"2010-07-23T22:18:22","slug":"mattel-v-mga-appeal","status":"publish","type":"post","link":"http:\/\/www.ipmetrics.net\/blog\/litigation\/case-law\/mattel-v-mga-appeal\/","title":{"rendered":"Top Lessons for Business from the Mattel v MGA Case"},"content":{"rendered":"

Yesterday\u2019s Ninth Circuit opinion brings renewed focus on central business lessons from an intellectual property management perspective.\u00a0 These lessons are evidently overlooked even by iconic organizations, such as Mattel, to their detriment.\u00a0 As a business owner or manager, you should discuss how these important IP and contractual elements could impact your organization with competent intellectual property counsel.<\/span><\/p>\n

First Lesson: Clearly Defined Contractual Terms<\/h2>\n

One of the first points made in the appeals court opinion refers to the ambiguity of Mattel\u2019s employment contract language regarding \u201cinventions\u201d that employees must assign to the company.\u00a0 Traditionally, an employee\u2019s innovations are assumed to be \u201cworks for hire\u201d and \u201cassigned to the employer,\u201d yet the strict meaning of these terms may be subject to different interpretations in various industries.<\/p>\n

This idea underlies the portion of the Appeals Court Opinion in this case wherein it is opined that the resolution of the meaning of the term \u201cinventions\u201d in the contract should have been decided by the jury, not summarily by the judge.\u00a0 Obviously, this is not a \u201cnew\u201d lesson by any means; it is one that regularly makes an encore appearance in contract disputes.\u00a0\u00a0 Both employers and employees will benefit in the future from clearly defining and clarifying the terms of their agreements, particularly where these agreements impact intellectual property rights that are seldom appreciated until those rights manifest their value.\u00a0 As the Appeal Judges\u2019 state in the Opinion, the error in construing the employment agreement \u201c\u2026 is sufficient to vacate the copyright injunction.\u201d<\/p>\n

Second Lesson: Copyright Does Not Cover Ideas<\/h2>\n

Judge Kozinski clearly states in the Opinion: \u201cMattel can\u2019t claim a monopoly over fashion dolls with a bratty look or attitude, or dolls sporting trendy clothing\u2014these are all unprotectable ideas.\u201d\u00a0 Businesses will be better served by acknowledging the limitations of fundamental protections such as Copyright to the tangible<\/span> expression<\/span> of ideas, not the ideas themselves.\u00a0 In our experience, few organizations have clearly defined policies and procedures in place to identify, manage, and protect works over which they can claim Copyright protection, let alone actually obtain a registration for them.\u00a0 Outside the publishing and media industries, copyrights seem far removed from everyday business activities and needs, and are typically not the subject of in-depth management attention.\u00a0 Only by implementing specific protocols for copyright management can appropriate measures be taken to develop promising ideas into protectable works, which can then securely support new business processes, products, or services.<\/p>\n

Third Lesson: Only Attributable Damages Are Recoverable<\/h2>\n

Trademark law allows for the recovery of those defendant\u2019s profits associated with the infringed trademark as compensatory damages for a proven infringement.\u00a0 It does not, according to the Ninth Circuit Opinion, grant the plaintiff all the profits earned by the defendant, especially that portion of profits that results from its own investment, efforts and other elements of intellectual property or intangible assets.\u00a0 From a business perspective, litigants are reminded that, while trademarks, patents, copyrights, and other IP may be part of the revenue-generating process, not all profit is automatically attributable to any one specific piece of IP.<\/p>\n

In the this case, the Judge clearly states that \u201cEven assuming that \u2026[the defendant]\u2026 misappropriated the names \u201cBratz\u201d and \u201cJade,\u201d the value of the trademarks the company eventually acquired for the entire Bratz line was significantly greater because of MGA\u2019s own development efforts, marketing and investment.\u201d\u00a0 In our own experience, the proper apportionment of infringement profits is one of the most important analysis points to consider when the facts of the case require it.<\/p>\n

Read more about this case here<\/a>.<\/span><\/p>\n

Disclaimer:\u00a0 We are not attorneys and do not offer or provide legal advice.\u00a0 You should speak with competent intellectual property counsel to address your legal concerns.<\/strong><\/h4>\n","protected":false},"excerpt":{"rendered":"

Yesterday\u2019s Ninth Circuit opinion brings renewed focus on central business lessons from the intellectual property perspective. These lessons are evidently overlooked even by iconic organizations, such as Mattel, to their detriment.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[3,4,6,10,11,21],"tags":[],"jetpack_sharing_enabled":true,"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p2xROl-n","_links":{"self":[{"href":"http:\/\/www.ipmetrics.net\/blog\/wp-json\/wp\/v2\/posts\/23"}],"collection":[{"href":"http:\/\/www.ipmetrics.net\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.ipmetrics.net\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.ipmetrics.net\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.ipmetrics.net\/blog\/wp-json\/wp\/v2\/comments?post=23"}],"version-history":[{"count":0,"href":"http:\/\/www.ipmetrics.net\/blog\/wp-json\/wp\/v2\/posts\/23\/revisions"}],"wp:attachment":[{"href":"http:\/\/www.ipmetrics.net\/blog\/wp-json\/wp\/v2\/media?parent=23"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.ipmetrics.net\/blog\/wp-json\/wp\/v2\/categories?post=23"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.ipmetrics.net\/blog\/wp-json\/wp\/v2\/tags?post=23"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}