GOLDEN GATE UNIVERSITY
SCHOOL OF LAW
FINAL EXAM
INTELLECTUAL PROPERTY LITIGATION
FALL 2001
PROFESSOR WILLIAM T. GALLAGHER
THIS IS AN OPEN BOOK, OPEN MATERIALS EXAM. You may use any notes, outlines, books, or other materials to assist you in responding to the questions.
There are three (3) essay questions (with subparts). Question I is worth 60 total points; Questions 2 and 3 are each worth 20 total points-for a total of 100 points possible on this exam. Please allot your time accordingly.
You have three hours to complete the exam, although you may not need the entire time to provide excellent answers. I have allowed three hours to ensure that you have ample time to provide good answers without feeling rushed.
You are to write your answers in a blue book or type them on plain, unmarked typing paper. PLEASE PLACE YOUR EXAM NUMBER ON EACH BLUE BOOK OR ON EACH TYPED PAGE. Please also write as legibly as possible, using every other line if your handwriting is difficult to read.
QUESTION NO. 1 (60 points):
Blue Velvet, Inc. is a Mexican corporation that bottles and distributes tequila in Mexico, with plans to expand into the U.S. market. On August 20, 2001, Blue Velvet Inc, filed an Intent To Use (ITU) application with the U.S.P.T.O. for the BLUE VELVET trademark for tequila based on its registration of the BLUE VELVET mark in Mexico (which issued on December 7, 2000). BLUE VELVET is a premium tequila that comes in a deluxe cobalt blue bottle with a blue velvet case. It sells for $200 per bottle and contains a blue worm in each bottle. Blue Velvet, Inc. plans to bring 5000 cases of BLUE VELVET tequila into the U.S. market per year. Its target customers are upscale restaurants and cigar bars. Blue Velvet, Inc. began importing BLUE VELVET tequila into the U.S. on September 1, 2001. The initial shipments have been limited to Texas and California.
Velvet Distilleries Corp. is a U.S. corporation that is well established as a distributor of vodka. Its main product is a packaged clear bottle of vodka with a royal blue label with the word "VELVET" in silver type. During the last ten years it has promoted its line of vodka with the tagline "As smooth as Blue Velvet". Consumers frequently order their vodka at bars by asking for "Blue Velvet". In June of 2001, Velvet Distilleries conducted a marketing survey that showed 60% of those surveyed associate the term "BLUE VELVET" with Velvet Distilleries' vodka product. Velvet Distilleries believes it has strong rights to the trademark "BLUE VELVET", but it has not filed for any state or federal trademark registration. Velvet Distilleries sells its vodka product through package stores, supermarkets, price clubs bars, and restaurants throughout the U.S.
On September 12, 2001, Velvet Distilleries learned about Blue Velvet Inc's recently filed ITU application. At the same time, it learned of Blue Velvet, Inc's shipments of products to Texas and California. On September 30, 2001, Velvet Distilleries sent Blue Velvet, Inc. a warning letter demanding that it stop shipping its product into the U.S. market. Based on your performance in this class, you have been asked to represent Blue Velvet, Inc. Your client wants your advice on the following issues: (each is worth the same number of points)
1) Whether Velvet Distilleries has viable legal claims against Blue Velvet, Inc. under any theory of IP law and, if so, what Blue Velvet, Ine's exposure to legal remedies might be.
2) Whether Blue Velvet, Inc. can and should file a lawsuit in federal court in the Northern District of California next week seeking declaratory relief.
3) Whether Blue Velvet, Inc. has options other than filing a declaratory relief action in federal court and, if so, whether you recommend any of these options.
4) What discovery should Blue Velvet, Inc. propound if it decides to go ahead with its federal court lawsuit?
QUESTION NO. 2 (20 points):
A new client of yours, Keyboards-R-Us, believes a competitor, Type-Eaze, has been selling an ergonomic computer keyboard for four years (over 100,000 keyboards sold) which infringes two of six claims in Keyboards-R-Us' U.S. Patent No. 1,857,131. Type-Eaze's keyboards are manufactured entirely in Taiwan and imported into the U.S for sale.
Keyboards-R-Us wants your advice on what legal remedies it has available against TypeEaze under the patent laws and the likely benefits/risks of pursuing those options. What is your response?
QUESTION NO. 3 (20 points):
You have been asked to bring a lawsuit and to select a damages expert to testify at trial in a copyright action brought by your client, an author, against a defendant publishing company. The defendant publisher has sold 500,000 copies of a book which your client believes infringes his published work "The Gerald Ford Story: The Early Years". Your client wants advice on the following two issues (both worth equal points):
1) What questions should you ask of potential experts to determine whether you will hire them and why?
2) What discovery will you need to take to support your plaintiff's case for copyright infringement and to assist your expert's damages analysis?