Traverse Legal Wins Summary Judgment on ACPA Cybersquatting Claim

After a two year legal battle, Traverse Legal has won summary judgment for an Anticybersquatting Consumer Protection Act (“ACPA”) claim on behalf of Palace Resorts.  The Southern District of Florida found that Palace Resorts had carried its burden and was entitled to a judgment as a matter of law.

To succeed on a summary judgment motion under ACPA, Palace Resorts had to prove that (1) the defendant registered, trafficked in, or used a domain name; (2) which is identical or confusingly similar to a mark owned by Palace Resorts; (3) the mark was distinctive at the time of the defendant’s registration of the domain name; and (4) the defendant has committed the acts with a bad faith intent to profit from the plaintiff’s mark.

In short, the Court found that the Defendants registered forty (40) domain names that were confusingly similar to trademarks belonging to Palace Resorts and that “the evidence overwhelming indicates that Defendants registered and used these domain names with a bad-faith intent to profit off of Palace Resorts’ trademarks and corresponding goodwill.”  The full opinion can be found below.

2018 06 12 (Dkt 240) Order Granting MSJ ACPA


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Toys ‘R’ Us Domains Up for Auction

As a result of Toys ‘R’ Us going bankrupt and closing all of its U.S. stores, toy retailer plans to place some of its assets up for auction, including a slew of surprising domain names one might not expect a toy company to own.  Among the domains soon to be auctioned include sex-toys-r-us.com, ihatetoysrus.com, toysrussucks.com, kinkytoysrus.com, adult-toys-r-us.com, as well as lodges-r-us.com, bistros-r-us.com, recipes-r-us.com, burgers-r-us.com, and cigars-r-us.com.

Many big businesses engage in the practice of registering similar domain names to their primary one for several reasons:

1. One big reason is to protect the business’ trademarks and brand.  Toys ‘R’ Us is primarily known for the “‘R’ Us” portion of its name, which is reflected in the alternative domain names it chose to register and own.  Having websites such as “sex-toys-r-us.com” available and active could severely harm a kid friendly brand like Toys ‘R’ Us.
2. Another reason is to avoid a practice called typosquatting, which involves registering a domain name with a slight typographical differences from that of the legitimate business, relying on the presumption that some users will misspell the domain name when typing it into a web browser.  Typosquatting can lead to consumer confusion and harm both the business and brand.
3. A third reason businesses may want to register a variety of domain names is to avoid gripe sites from being developed.  For instance, “toysrussucks.com” could have been potentially registered by someone with a grudge against Toys ‘R’ Us looking to disparage the company.  This is problematic because while some gripe sites have been removed for reasons of defamation or trademark infringement, some are couched in opinion and therefore protected by First Amendment free speech.

Whatever the primary motivator for Toys ‘R’ Us to register these domain names, the fact that they are now up for auction is noteworthy.  While Toys ‘R’ Us has unfortunately failed as a business, the purchasers of these domain names may now be able to capitalize on a brand that will undoubtedly remain relevant in today’s society for quite some time to come.

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Class Action Against Intel alleging a defect in Intel’s x86-64x CPU

If you have a computer which includes the Intel’s x86-64x CPU and are interested in (a) learning more or (b) being included in a class action against Intel, contact us today. We have consumer class action attorneys standing by to assist and help you understand your legal rights.

‘Plaintiffs’ ‘ class action against defendant Intel Corporation (“Intel” or “Defendant”) is on behalf of all persons who purchased a defective Intel core processor (“CPUs”). The allegations include:

1. Defendant Intel’s x86-64x CPUs suffer from a security defect, which causes the CPUs to be exposed to troubling security vulnerabilities by allowing potential access to extremely secure kernel data (the “Defect”). The only way to “patch” this vulnerability requires extensive changes to the root levels of the Operating System which will dramatically reduce performance of the CPU. The Defect renders the Intel x86-64x CPUs unfit for their intended use and purpose. The Defect exists in all Intel x86-64x CPUs manufactured since at least 2008. The x86-64x CPU is, and was, utilized in the majority of all desktop, laptop computers, and servers in the United States.
2. To date, Defendant has been unable or unwilling to repair the Defect or offer Plaintiffs and class members a non-defective Intel CPU or reimbursement for the cost of such CPU and the consequential damages arising from the purchase and use of such CPUs. Indeed, there does not appear to be a true “fix” for the Defect. The security “patch,” while expected to cure the security vulnerabilities, will dramatically degrade the CPU’s performance. Therefore, the only “fix” would be to exchange the defective x86-64x processor with a device containing a processor not subject to this security vulnerability. In essence, Intel x86-64x CPU owners are left with the unappealing choice of either purchasing a new processor or computer containing a CPU that does not contain the Defect, or continuing to use a computer with massive security vulnerabilities or one with significant performance degradation.
3. The CPUs Defendant manufactured and sold to Plaintiffs and Class members were not merchantable and were not fit for the ordinary and particular purposes for which such goods are used in that the CPUs suffer from a critical security defect, requiring an OS-level software patch that will degrade the performance of the CPU.
4. Having purchased a CPU that suffers from this Defect, Plaintiffs and class members suffered injury in fact and a loss of money or property as a result of Defendant’s conduct in designing, manufacturing, distributing and selling defective CPUs. Intel has failed to remedy this harm, and has earned and continues to earn substantial profit from selling defective CPUs.

Further resources can be found here.

• Intel hit with class action suit over CPU defects: The case itself aims to represent any US purchaser of Intel CPUs containing the defect, or purchasers of a device containing one of these Intel processors. The defect is actually down to what Intel must have through was a clever bit of engineering. The kernel mode attempts to guess what the user will do next, known as ‘speculative execution’, having certain programmes on stand-by to increase speed and performance. This action potentially exposes kernel data, one of the most sensitive parts of a computer. http://telecoms.com/486974/intel-hit-with-class-action-suit-over-cpu-defects/
• Intel Hit With Three Class Action Lawsuits Related to Security Vulnerability: It’s been just two days since The Register first reported that all Intel x86-64x processors were subject to a severe security vulnerability, and already Intel has been hit with at least three separate class action lawsuits related to the vulnerability.
• Purchasers and consumers can find out more information about the two security vulnerabilities pertaining to Intel’s chip design flaw by reviewing PCMag’s “Chip Design Flaw Not Limited to Intel, Researchers Say,” and the Meltdown and Spectre-related website referenced in the article.

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The Importance of Industry Standards to the Drone Market

As drone services market continues to evolve, market success stories are becoming more common. The number of drone pilots complying with the Part 107 regulations, including waivers and authorizations, increases every day. Professional grade drone contracts, UAV Operating Manuals and websites which give customers confidence are important assets being leveraged by the industry. Professionalism within the drone industry continues to become the standard.

Currently, there is no consensus on industry standards beyond compliance with the Part 107 regulations.
But sUAS industry standards are coming, just like such standards eventually take hold in virtually every new and emerging industry. Industry standards will help the drone services market grow and achieve service and copyright license pricing which reflects the value of the drone services provided. In this episode of Drone Law Pro radio, we discussed the importance of industry standards for unmanned aerial vehicles.

 

More UAV Drone and Part 107 Resources:

• Why Standards Will Be Critical to UAV Adoption
• Whether advocating for smart public policy or crafting key industry standards, CTIA helps our members navigate the complex legal and regulatory environment for utilizing commercial wireless networks for Unmanned Aircraft Systems (“UAS”) and Unmanned Aerial Vehicles (“UAV”), commonly referred to as Drones.
• How standards will target the drone industry
• ICAO Panel Will Recommend First UAV Standards in 2018: The International Civil Aviation Organization’s (ICAO) new Remotely Piloted Aircraft Systems (RPAS) Panel aims to deliver standards for unmanned aircraft to the organization’s governing council in 2018.

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Responding to a Litigation Subpoena: Technology Attorney Tips

Has your technology, web or internet company received a subpoena from an attorney?  In this episode, litigation attorney Enrico Schaefer explains how to respond to a third party deposition and/or document production subpoena.

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Non-Compete Trends

Non-Compete Agreements  that would also include non-solicitation agreements and trade secret protections have become part of the territory in employment and trade secret law for the past two decades or so as an aid to employers to protect sensitive information, investment in employee training and customer relationships, but what are the trends now that non-compete agreements have been around for a while.

The trends in recent years suggest the pendulum is swinging in favor of placing more limitations on the enforcement of non-compete agreements.  In response to more pervasive use of non-compete agreements including company policies which compel lower level employees to execute non-compete agreements state legislatures have introduced legislation of the past several years seeking to restrict non-compete agreements in response to their overuse.   Six states including Alabama, Hawaii, Illinois, New Mexico, Oregon, and Utah have passed legislation restricting or otherwise limiting the enforceability  of non-compete agreements.  Legislatures in seven other states have introduced but not passed legislation with the same focus including Idaho, Massachusetts, Missouri, Maryland, Michigan, New Jersey and Washington.  Likewise, there is a growing trend among courts with discretion on the issue of enforceability to curb what is being perceived as the overuse or abuse of non-compete agreements beyond their intended purposes.  Not so recently, California and Oklahoma have enacted laws to prohibit non-competes except in very limited circumstances and generally related to the sale of a business.

It will be up to employers in states where non-competes remain valid and enforceable to utilize the non-compete tools in a responsible manner consistent with their intended purposes and not to over utilize non-compete agreements, otherwise the trend toward limiting or eliminating enforcement of non-compete agreements will continue.  Consultation with qualified legal counsel is an effective way to determine the judicious use of non-competes tailored to your business or industry.

 

 

 

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Legal Checklist for Startups and Founders

Whether a first time startup, repeat founder onto the next venture or an operational business trying to get your “legal house” in order, a simple legal checklist is always helpful.  There are lots of samples available, but here is a practical one that can help guide you, and your lawyer, as you begin and hopefully prosper.

Entity Formation/Initial Set-up

–Form entity (corporation, LLC, partnership, etc.)

–Anticipated financing path (amount needed, growth anticipated, multiple financing rounds)

–Rights of Founder(s) (vesting?)

–Equity compensation for employees/consultants/advisors (vesting and repurchase rights)

–Involve CPA/tax advisor early

Financing

–Convertible Note

–Convertible Preferred Stock (Series Seed, Series A, B, C, etc.)

–Others (SAFE (Simple Agreement for Future Equity), Debt)

Practical Considerations of Financing

–How much will you need?

–Disclosure

–Finders

–Organization

Contracts/Agreements

–Employment/Independent Contractor/Advisor Agreements (work for hire)

–Non-Disclosure/Non-Circumvention/Non-Use

–Website Agreements (Terms of Use, Privacy Policy, Copyright Policy, Disclaimers)

Trademark

–Protect your house mark and brands

–Trademark Availability Assessment/Clearance

–Register domain names (Defensive registrations)

–Social Media, including online reputation management

Copyrights

–Personal ownership of IP versus ownership by entity (licensing issues)

Patents and Trade Secrets

–Assess opportunities and risks

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