Yearly Archives: 2010

Brand or Anti-Brand?

Dec 3, 2010 Stacey L. Dogan2 comments

How many law review articles begin with a scene from Wayne’s World?  For Sonia Katyal, such an opening is par for the course.  Since she entered the scene a decade ago, Katyal’s scholarship has celebrated irreverence, and examined the ways in which the law tolerates, enables, and often discourages commentary on dominant culture, icons, and in this case, brands.  This essay – written for a symposium on advertising and the law at SUNY Buffalo Law School – continues the Katyal tradition.

In Stealth Marketing, Katyal takes up the question of whether and how the law should deal with the increasing convergence between speech from trademark holders and speech about trademark holders.  The essay picks up on a phenomenon that Ellen Goodman raised several years ago in her article, Stealth Marketing and Editorial Integrity, 85 Tex. L. Rev. 83 (2006).  Goodman’s piece had explored the various ways in which advertisers pay to slip their messages into communicative products, leaving consumers uncertain as to the objectivity or veracity of the content they consume.  Goodman’s inquiry focused on the extent to which the law can or should require disclosure when a business, advocacy organization, or even an arm of the government pays to have its messages incorporated into a third party’s communicative work.

Katyal’s essay observes that the growth of stealth marketing has coincided with another cultural phenomenon:  the use of “anti-branding” by commentators seeking to shape popular perception of dominant brands.  Anti-branding involves the use of a brand to comment on the brand itself or to make a broader social commentary about advertising, consumerism, or some other political or societal concern.  Katyal gives several colorful examples of anti-branding.  Take the Absolut Nonsense campaign:

[A]n image of an Absolut vodka bottle is depicted with the slogan, “Any suggestion that our advertising campaign has contributed to alcoholism, drunk driving, or wife and child beating is absolute nonsense.  No one pays any attention to advertising.” (P. 807).

As Katyal points out, this use of the ABSOLUT mark arguably aims at several different targets at once:  the ABSOLUT vodka product, the ABSOLUT marketing campaign, and the general practice of advertising.  (One could easily add other satirical targets to this list, including our society’s widespread denial of alcohol’s harmful effects.).  More generally, anti-branding seeks to “expose, dissect, and then recode messages in advertising.”  (P. 811).  It uses marks to convey a message that may be complementary, oppositional, or orthogonal to the one cultivated by the trademark holder, but that comes from a distinct – and often critical – source.

Although Katyal spends some time exploring the extent to which the law allows or obstructs various forms of anti-branding, her real goal in this essay is to make a different point:  that the existence of this often irreverent, ironic, edgy, and unauthorized use of marks further complicates consumers’ perception of the many different communicative forms in which they encounter trademarks in their everyday lives.  As Katyal observes, stealth marketing itself has begun to take on some of the characteristics of anti-branding, by using third-party agents and sometimes self-mocking messages to enhance brand awareness among consumers.  In the afore-mentioned Wayne’s World scene, for example, the actors ridiculed the idea of product placement while guzzling and gobbling brand name food and drinks on-screen.  As stealth marketing itself becomes edgier, stealthier, and more irreverent – and as it broadens the cast of spokespeople paid to achieve its commercial objectives – consumers may have an ever-harder time distinguishing between messages conveyed by objective third parties and those delivered, sponsored, or paid for by the trademark holder.  Anti-branding and stealth marketing, in other words, may become increasingly indistinguishable.

Katyal does not fully develop the normative implications of her insights, nor does she pretend to.  She gives an approving nod to suggestions by Rebecca Tushnet and Ellen Goodman to increase disclosure of payments to those who tout, mention, or otherwise promote particular brands.  And she mentions the Federal Trade Commission’s recent movement in that direction.  But the essay’s real value lies in its artful description of the complex ways in which old-fashioned branding, anti-branding, and stealth and guerrilla branding appear, overlap, and interact, and the implications for our information-overloaded society.  Besides, it’s an awfully fun read.

Consumption-Based Distinctions Consuming Themselves: The Rise and Fall of Intellectual Property as the Enabler of a Sumptuary Code

Sep 30, 2010 Kevin E. Collins

If you ever find that your reading in the field of intellectual property is becoming repetitive, or if you feel you’ve already cataloged all of the different cookie cutters that are commonly used to stamp out contemporary scholarship, then here’s what you should do: sit down to read Barton Beebe’s Intellectual Property and the Sumptuary Code and enjoy the ride.  It’s not exactly conventional beach reading for the dog days of August, but Beebe does build an intricate sand castle—he articulates a highly original thesis concerning the social function that certain trademark-related doctrines are playing in contemporary society—both expecting and hoping that it will soon collapse under its own weight.

For those of you who, like me, are not entirely literate in the history of fashion, a sumptuary law is a law that regulates luxury expenditure and enforces social hierarchy.  (P. 810.)  A sumptuary code, in turn, is roughly the social-norm analog of a sumptuary law.  It is a semiotic system of consumption practices through which individuals send signals about their differences and similarities.  (P. 812.)¹  And unlike sumptuary laws, which have largely disappeared, sumptuary codes are very much alive and well.

Beebe argues that emerging technological conditions threaten the viability of the contemporary sumptuary code in that “most competitively consumed goods can be persuasively simulated,” meaning that “our increasingly powerful copying technologies threaten quickly to dilute the rarity and thus the distinctiveness of otherwise distinctive goods.”  (P. 814.)  In much less refined language, where once upon a time I could rely on scarcity, price, and closely guarded knowledge to ensure that the things that I and my kind consumed were not available to everyone immediately, and therefore to ensure that my consumption of those goods was meaningful under the sumptuary code, advanced technologies of dissemination and reproduction, overseas sweatshops, and overnight delivery mean that I no longer can.

Beebe sees intellectual property law as a last line of defense for those who are interested in maintaining a meaningful sumptuary code.  “If we wish to preserve our system of consumption-based distinction, then we require a set of laws to do the work that our material conditions once did.”  (P. 815.)  In particular, Beebe convincingly discusses at length how antidilution law, geographic indications, and traditional cultural protections restrict the production—and thus indirectly the consumption—of goods and enables consumption to retain some meaning in a sumptuary code.

Beebe’s recasting of these doctrines lying at the periphery of trademark law as the tools of last resort for those who are interested in maintaining a meaningful sumptuary code is an insightful elaboration on a more general theme that carries through a great deal of recent trademark scholarship.  The commonly observed trend is that trademarks are moving from being means (the labels placed on goods desired by consumers to indicate the origin of the goods) to ends (the desired goods themselves).  What does it mean for the mark to be a good desired by the consumer?  The mark is valuable because it signifies something to those who see the consumer consuming it.  What does the mark signify?  It sends a message about social status that, absent expansive trademark law, would be drowned out by static.  Trademark-related doctrines serve the social function of enabling marks to carry meaning not only about the goods to which they are attached to the consumer but also about the people to whom the goods are attached to those who witness the consumption.  In other words, trademark-related doctrines serve the social function of enabling a sumptuary code.

Beebe is no fan of exclusive consumption-based social hierarchies that sumptuary codes usually maintain and reinforce, so he seems to delight in foreseeing the possible demise of the very social function of trademark-related doctrines that he so carefully and ingeniously unveils.  Intellectual property does not simply maintain the meanings of extant marks.  It creates incentives for “Progress” (with the capital “P” to be taken with some irony, as Beebe fully recognizes²) in that new market entrants will fabricate new marks and attempt to endow them with new meanings.  In Beebe’s crystal ball, the inevitable “arms race” among mark producers will wear out consumers’ abilities to consume meaningful symbols and thereby herald the end of the sumptuary code.  In Beebe’s own language, “as our system of consumption-based social distinction produces more and more commodified forms of distinction, the ability of individuals to comprehend these forms may reach a limit, one beyond which a seeming infinitude of such forms of distinction appears to blur into indistinction.”  (P. 882.) Beebe then concludes with a utopian vision of what non-consumption-based systems of social distinction might rise from the pile of sand into which his castle has crumbed, but, to avoid spoiling all of your beach-time fun, this final twist I leave for you to discover yourselves.

Distinction With(out) a Difference: Attribution’s Challenge to Intellectual Property Law

Sep 30, 2010 Laura A. Heymann

In his most recent article, Barton Beebe provides a typically sophisticated and rich analysis of the ways in which intellectual property law is used to reinforce exclusivity, much as sumptuary laws have done throughout history.  Such laws, by regulating the fashions of the citizenry, enacted a dialogue about distinction and group identity, in which those permitted to wear certain costuming could communicate to others their inclusion in a particular class.  Sumptuary laws accomplished formally what now sometimes occurs through more vague forces of collective action: the price of a designer handbag forecloses wide adoption (until its double becomes available at Target), and limited editions of collectibles ensure that the competition for exclusivity is played out openly.  The same processes take place in the noncommercial realm: the names given by those in higher socioeconomic classes to their children, for example, trickle down over time to parents in lower socioeconomic classes with particular aspirations for their children, thus diluting the prestige of the name among the wealthy, who then abandon it in the next generation.

The importance of a system of distinction is not necessarily, Prof. Beebe notes, tied to a desire for superiority or opposition, although presumably at least some individuals are so motivated.  Rather, a level of “optimal distinctiveness” allows individuals to construct their own identities while affiliating with other individuals who share their interests.  (Indeed, in some cases, these affiliations coalesce around a message of “counterconformity” that rejects the hierarchy created by status goods, thus resulting in, ironically, a new mode of conformity that further contributes to the clamor of voices all proclaiming themselves to be different.)  And for some consumers, close enough is good enough:  so long as a handbag appears to others to be a designer brand and doesn’t fall apart on repeated uses, it serves both the purpose of holding one’s personal items and the purpose of signaling one’s place in the social and economic hierarchy — as Prof. Beebe phrases it, it represents relative utility, if not full absolute utility.

Prof. Beebe contends that although the sumptuary laws of old may no longer be in force, such codes are still enacted today through intellectual property law.  The ability of modern technology to create near-perfect copies — whether of diamonds, musical recordings, or handbags — means that material manufacture no longer contains its own inherent constraints on acquisition and consumption.  Indeed, even the producers of “authentic” goods have difficulty distinguishing these simulations from their own products.  Intellectual property law, Prof. Beebe argues, provides these constraints, imposing by legal means what can no longer be imposed naturally.  Intellectual property law, after all, often concerns itself with acts of copying, impersonation, and inauthenticity: purporting to be something or someone other than the original.

To illustrate this phenomenon, Prof. Beebe considers two forms of authenticity protection that intellectual property law takes:  antidilution law and geographical indicators.  Trademark’s antidilution law nominally concerns itself not with uses that substitute for the utility of the good in the marketplace but with uses that chip away at the uniqueness of the trademark, a feature that by definition, and unlike other forms of intellectual property, is rivalrous.  As Prof. Beebe points out, however, courts’ reluctance to embrace this theory of antidilution law has led to their use of other intellectual property doctrines, such as post-sale and sponsorship confusion in the trademark context as well as copyright law, to accomplish the same goal.  Indeed, Prof. Beebe astutely notes, copyright law’s extension of infringement to works that are substantially similar to the protected work “include[s] copying that, while perhaps not fully substitutive in nature, is nevertheless dilutive of the distinctive style or ‘aesthetic appeal’ of the plaintiff’s work.”  (P. 862.)  Likewise with the pending Innovative Design Protection and Piracy Prevention Act:  As Prof. Beebe notes, it is not the threat of lost sales that motivates such legislative efforts — the market for the Versace gown is not likely to overlap significantly with the market for the department-store copy — but a desire to maintain a hierarchy of distinction in which the class-based signals sent by the wearer of the Versace gown are clear and unmistakable.

Geographical indicators and other statements of authenticity (such as those identifying a good as from a particular indigenous group) serve as a similar communication of distinction and difference.  Whereas the circumstances of production might previously have indicated authenticity — only certain producers had access to the materials and know-how that could result in certain goods — technology has often eliminated this advantage, requiring producers to communicate their products’ origin stories explicitly.  Of course, when copies can barely be distinguished on their face from the original, a statement of authenticity tends to communicate nothing more about a product’s qualities than the claimed authenticity itself.  And yet presumably, as Prof. Beebe suggests, these statements are made because consumers care about such origins.  It matters to them from whom or from where a product originated — that “Champagne” comes from France, not from California — even though the qualities of that product may be identical to its differently denoted competitor.

The use of intellectual property to replicate the force of sumptuary laws, argues Prof. Beebe, unmoors intellectual property law from its core interests in promoting the creation of goods so as to eventually encourage copying (in the case of copyright law and patent law) and in ensuring consumers are able to find the goods or services they want without being confused as to the product’s source (in the case of trademark law).  Prof. Beebe is somewhat despairing of any major change in this state of affairs, although he notes one bright spot on the horizon: the emergence of a commons-based system of innovation in which freely given creation, rather than consumption, is the focus.  In order for this system of innovation to flourish, however, it needs to provide contributors the reputational gains that, at least in part, inspire them to create and contribute.  So, as Prof. Beebe concludes, attribution becomes a key value that intellectual property law should promote, if only by encouraging “the growth and extension of the social movements that both rely on and help to propagate this system of social distinction.”   (P. 885–86.)

Prof. Beebe does caution that the modes of attribution that allow innovators to get credit for their work are the same modes that allow designers to promote their sumptuary code–based interests, but this should concern us only so much.  So long as consumers of all types — whether economic or intellectual — know what they are getting and from whom they are getting it, the choice as to how much to consume from what sources should remain theirs.  This is not to say that intellectual property law is currently operating within such narrow boundaries — Prof. Beebe’s discussion of post-sale confusion, which is typically not confusion at all, illuminates the fact that trademark owners use the law in many cases not to eliminate confusion but to eliminate competition.  But it is to say that intellectual property law should not much care that Louis Vuitton’s trademark has a signaling effect as well as a source-identifying effect, even if some might believe that the purchase of the former is a wasted expenditure.

The importance of attribution and our fluid system of naming practices also mean that intellectual property law has more work to do about what authorship and source mean in the realm of creative products.  Although these are exalted concepts in copyright and trademark law, they are more complicated in practice.  Copyright law uses the word “author” both for the writer whose hand holds the pen and for the corporate entity that merely sponsors the creative work, and trademark law allows corporations to disseminate goods under various sub-brands and change their names after public relations blunders without fear of liability.  And sometimes, as in the case of Andy Warhol’s Factory — which created original “Andy Warhols” for which the artist’s primary role was to affix his signature — a communicative product complicates questions both of authorship and of source, leaving us the task of distinguishing authentic from inauthentic.  For now, we can be fairly confident that, contrary to the Court’s view in Dastar Corp. v. Twentieth Century Fox Film Corp., authorship and source are indeed of interest to consumers of creative products.  And as Prof. Beebe correctly asserts, it will be intellectual property’s challenge going forward to determine how to appropriately address these interests.

Marks on Marks

Aug 2, 2010 Sara Stadler

There’s nothing like the realpolitik of copyright to push you into the arms of trademark law (see Dotan Oliar on Bill Patry, supra), but as Mark Lemley and Mark McKenna reveal in Owning Mark(et)s, there’s plenty of corporatism at work in the evolution of trademark law, too. Lemley and McKenna don’t put it that way, and they probably wouldn’t. But it’s hard to read Owning Mark(et)s without reflecting on how thoroughly legal rules are changing to favor the great and powerful, whose primary goal, as ever, is to foreclose markets to new entrants—including markets that the great and powerful haven’t entered.

Knowing that it doesn’t pay to be a bully, trademark owners have styled themselves victims of junior users who, in using established marks in “unrelated” markets, “are mere free-riders, reaping where they have not sown.” This may sound appealing, but trademark rights are supposed to flow from use in trade. One who hasn’t entered a market isn’t supposed to “own” it. As Lemley and McKenna write, “[t]he idea that a mark owner is harmed because a defendant interferes with its ability to expand operates on a presumption that the mark owner ought to have the right to expand without interference.” But the trademark owner doesn’t have that right unless the law says it does. This is the circularity that “seems to have carried the day in copyright,” and as Lemley and McKenna demonstrate, it’s transforming trademark law, too, as courts give trademark owners priority in markets that their trade hasn’t entered, but to which it might conceivably extend.

Fortunately, the authors have a plan.

I’ve divided Owning Mark(et)s into three parts: the law; the evidence; and the proposal. In the first part, Lemley and McKenna relate the “traditional” case for trademark protection—namely, the prevention and punishment of source confusion—and then describe how, beyond that, things “get a little more complicated.” The complication lies in the fact that trademark owners now allege, as harm, not the diversion of existing trade, but the usurpation or destruction of future trading opportunities. If, for example, a third party were to offer Apple watches for sale, Apple’s complaint wouldn’t be, “They deceived my customers,” but instead would be that “the existence of another Apple in the watch market impedes the original Apple’s ability to expand—either into the watch market or other related markets.”

This is a powerful argument for trademark owners precisely because it’s always available, regardless of how little proximity there is between plaintiff and defendant in the marketplace. Lemley and McKenna illustrate the point by describing a handful of recent trademark cases in which source confusion was absent, but in which, nonetheless, courts acted to remedy the “harms” of market preemption and free riding. None of these cases should be news to trademark scholars (or practitioners), but taken together, they tell an interesting story. It’s a coherent and engaging read.

This part also contains more than a few sentences that made me reach for my pen. In revealing how trademark owners characterize benefits to defendants as harms to themselves, for example, Lemley and McKenna write, “[i]n fact, however, these claims of harm and claims of benefit run together, particularly in [intellectual property], where the entire concept of harm is in some sense an artificial construct based on the government’s decision to create a right.” The authors’ focus on the relationship between harms and benefits is one of the more intriguing aspects to Owning Mark(et)s. As they point out, we now appear to live in a world in which it’s not enough to suffer no harm; others must not be allowed to benefit, either. Copyright already has embraced this orthodoxy, which is why it’s so hard to care about copyright law any longer. Et tu, trademark? As Lemley and McKenna observe, “a right to control ancillary markets bears striking resemblance to the derivative work right in copyright law.” It’s all coming together now, and not in a good way for consumers.

The second part of the article discusses marketing studies showing that brand extension doesn’t damage consumers’ perceptions of the “core brand” (e.g., Neutrogena hand lotion) but, at worst, damages their perceptions of the “parent brand” (e.g., Neutrogena) in an abstract sense. According to Lemley and McKenna, this doesn’t translate to much, if any, harm to brand value, and I think they’re right, although I’ve always been suspicious of the sorts of studies on which they rely. The problem is that trademark owners aren’t likely to take much, if any, comfort from this, which means they aren’t likely to stay their hands as a result. The great majority of trademark scholars know, in their hearts, that these harms to brands aren’t occurring. But we’re not the ones bringing the cases.

Which brings me to the third part of the article. A solution to the problem that Lemley and McKenna describe isn’t obvious, primarily because courts have used a variety of doctrines to satisfy the demands of trademark owners. Lemley and McKenna resolve this difficulty by proposing to require plaintiffs in trademark actions to show “trademark injury,” which the authors define as a material amount of “confus[ion] about actual source or about responsibility for quality.” This is a nifty solution because, like antitrust injury, the doctrine could be created by courts. Congress is not about to adopt such a thing because the International Trademark Association, which drafts the bills, is not about to propose it. Now, I’m the last person to ask courts to legislate, but when Congress uses lawmaking to cultivate its most powerful constituents, it’s hard not to look to courts for help—particularly where, as here, there’s precedent for courts to act. Of course, “[a] trademark injury doctrine is not a panacea.” But at least it’s something workable, and maybe even wise. That, in itself, is worth celebrating.

Finding a Place for Data in the Patent Troll Debate

Jun 24, 2010 Jason Schultz3 comments

Patent lawyers, like many of our kind, are obsessed with classifications, determinations, and definitions: is a patent claim a true invention or is it part of the prior art? Is it an abstract idea or a specific method? Does it claim a means or a function? In fact, the very notion of intellectual “property” is premised on the idea that we can discern one category of things from another in order to establish metes and bounds and enforce exclusion.

No patent classification schema has been more controversial in recent years than that applied to patent litigation plaintiffs that do not make, use, sell or offer for sale a product or service. Are they trolls or investors? Are they rent-seekers or research incubators? Are they pests or pioneers? Such rhetoric has filled essays, academic articles, courtrooms and legislative halls without much actual evidence to support one characterization versus another.

Thus, it was refreshing to read Colleen Chien’s “Of Trolls, Davids, Goliaths, and Kings: Narratives and Evidence in the Litigation of High-Tech Patents”, 87 N.C. L. Rev. 1571 (2009). In this article, Chien looks beyond the mere labels applied to patent plaintiffs and studies actual data from cases filed to discern the narratives, practices, and strategies that could legitimately distinguish one patent plaintiff from another.³ The article also demonstrates the fruits born by the enormous effort of Stanford’s Intellectual Property Litigation Clearinghouse to collect and make available data on U.S. patent litigation.

Chien’s key contribution is taking the narratives of Trolls (or “non-practicing entities” – NPEs), Davids, Goliaths, and Kings and applying context to them via data. In other words, she tells us how much we might care about a given narrative by looking at the actual practices of those entities instead of the rhetoric or the hype. As she notes in her introduction, “Although the ‘squeakist wheel’—that is, the patent story that gets the most attention—may deserve the grease, without data it’s hard to be sure.” Chien breaks the data down into meaningful categories based on who sues whom and the size and revenue of each party.

So who deserves the grease? According to Chien, non-NPE corporations still bring the largest number of patent lawsuits (76%) and thus, the Sport of Kings (multiple-patent, often multiple-venue, lawsuits between large corporations) remains a strong narrative. Yet Trolls still deserve the attention they are receiving, not for their sheer numbers perhaps, but instead for their growing business model. The data shows that NPEs account for 17% of all high-tech patent lawsuits from 2001-2008, with the numbers of cases and defendants-sued-per-case increasing over time. This was particularly true with financial patents – 26% of all financial patent suits were initiated by NPEs – where decisions such as State Street Bank & Trust Co. v. Signature Financial Group, 149 F. 3d 1368 (Fed. Cir. 1998) broadened and reinforced the scope of patentable subject matter for financial methods and products.

Chien also uses the data to call into question “defensive patenting” – a practice of patenting to prevent offensive lawsuits via a strategy of détente instead of patenting to pursue licensing fees or exclusion – noting that the high number of large corporate suits suggests it may be failing to prevent such litigation.

In the end, I found Chien’s paper useful and interesting not so much for its conclusions (she is understandably conservative about how far the data can take us), but for its forthright attempt to challenge the narratives that patent lawyers have historically relied upon to make their policy points and rhetorical courtroom arguments. Mapping data to these narratives provides much needed insight into the real practices in the world of patent litigation and leaves us much better informed about the trends and trajectories to consider when entering any conversation about patent reform. For those who wish to tread on this ground, I highly recommend this article as a primer to help orient the conversation.