FINAL EXAM

INTELLECTUAL PROPERTY LAW SURVEY

GOLDEN GATE UNIVERSITY SCHOOL OF LAW

SPRING SEMESTER 2002

THIS IS AN OPEN BOOK OPEN MATERIALS EXAM. You may use any notes, books or other materials to assist you in responding to the questions.

There are three (3) essay questions on this exam. The first two questions are worth thirty-three points, and the third question is worth thirty-four points. The third question pertains to patent law. This question will be graded by Adjunct Professor Morrill. YOU MUST ANSWER THE THIRD (PATENT) QUESTION IN A SEPARATE BLUE BOOK, LABELED "PATENT QUESTION". If you need more than one blue book to answer this third question, each blue book you use must be labeled "Patent Question". The remainder of the exam will be graded by Professor Greenberg. Answer each question as fully as you can, citing any appropriate cases, industry standards, and statutes that are relevant.

DO NOT WRITE ON BOTH SIDES OF THE PAGE. WRITE LEGIBLY OR PRINT IF YOUR HANDWRITING IS DIFFICULT TO READ. If we cannot read your response to a question, your grade will be adversely affected. Be sure to write your exam number on your blue books and on the exam question. Turn in all questions, scratch paper and blue books after the conclusion of the exam.

You have three hours to complete this exam. You are not required to spend the entire time working on the exam - the average time for completion is between two and three hours. You should outline your response to each question, before writing the response. We recommend that you spend one third of the time on each question creating your outline, and the remainder of your time writing your answer. For example, if you spend 1.0 hour per question, devote 20 minutes to the outline, and 40 minutes writing the answer.

QUESTION NO. 1 (33 Points)

You have been approached for legal advice by STARDUST, INC., a Los Angeles, California corporation, with regard to a motion picture project they are working on, based on the life of the popular female vocalist and songwriter, JEWEL (she lives in both California and Texas). STARDUST wants to focus on JEWEL's early years, when she was so poor she lived in her car for long periods of time. To enhance the impact of the story, STARDUST wants to portray JEWEL as so desperate for money that she often robbed stores and committed acts of prostitution. STARDUST has no evidence these acts occurred, but intends to modify JEWEL's life story to increase the drama of their movie. STARDUST also plans to interview JEWEL's friends and family, and intends to change aspects of these people's lives as well, including making up criminal conduct by them as well, even though again STARDUST has no evidence of these acts really occurring.

STARDUST also plans to have its actors read portions of JEWEL's poetry (both published and unpublished poems) during the movie, and to reprint these poetry excerpts in a companion book they plan to release together with the motion picture. Finally, STARDUST plans to include some of JEWEL's songs and sound recordings on the movie. STARDUST does not plan to seek permission to use the poems or songs, as they do not want to spend the money to acquire these rights, and intend instead to rely on 1st Amendment and fair use arguments.

STARDUST has been warned by JEWEL, members of her family, her poetry book publisher, her record company and her publishing company, that all of them will sue STARDUST if the planned movie is released containing these materials. STARDUST wants to go forward with their project and asks you if any of these parties can sue them, and what causes of action can they assert. Lastly, as all clients do, STARDUST asks whether any of these parties are likely to win in any lawsuit they file, and what defenses can STARDUST raise in response to the causes of action you identify. What is your advice?

QUESTION NO. 2 (33 Points)

Pleased with the legal advice they received from you in response to Question One, STARDUST is back for more advice. This time, they want to protect the name of their motion picture production company, STARDUST. They have conducted a trademark search, which reveals that there are two other such production companies already in existence in the USA, and one in London, United Kingdom. The first currently active USA company is called STARDOZE, and is based in San Francisco. It has a California state trademark, and has been doing business in California only as a motion picture production company since 1990 (STARDUST begin doing business in California in 1995, and in interstate commerce in 2000). The second company, STARDUSTY, is based in Omaha, Nebraska, and began doing business as a motion picture company in 2001, and advertises its services nationwide via the Internet. STARDUSTY has no trademark registration anywhere, but does have a registration of its name, STARDUSTY.COM which it received from the Internet Corporation for Assigned Names and Numbers (ICANN) in 2001. The London based company is called STARRYDUST, and has been doing business in the European Union for the past three years, and has announced plans to apply in July 2002, for a Community Trademark for its name.

STARDUST asks you what further steps it must take to obtain a trademark in its company name, and assuming it is successful in doing so, what rights will it have to enforce its trademark against STARDOZE, STAR-DUSTY, and STARRYDUST?

QUESTION NO. 3 (34 Points)

Patent Law Question

For your convenience, 35 U.S.C. §§ 101, 102, 103, 112, 284 and 287 are attached.

Part 1: 18 points.

Larry Lite ("Lite") has invented a new flashlight. The improvement consists of circuitry (wiring) and a flashlight case, with which a white light-emitting diode ("LED") bulb can be used, resulting in a flashlight that has a battery life of thousands of hours.

The following are details of the invention and prosecution:

1. Larry thought up the idea on September 1, 1998, after discovering during a power outage that all of his flashlights had dead batteries.

2. Larry worked diligently and perfected the circuitry and case for his flashlight by November 1, 1998.

3. Larry sold some of his flashlights at a trade show in Toronto, Canada in late November, 1998.

4. Larry gave out about a dozen of his prototype flashlights to friends and family in the United States as presents in December, 1998.

5. Larry hired a patent lawyer in August 1999 and gave him a complete disclosure of the invention.

6. Larry thought of a better way of arranging the circuitry for his flashlight in September, 1999, which resulted in even longer battery life, but forgot to tell his patent lawyer about his improvement.

7. Larry's patent application was filed in January 2000, and the description of the invention in the application was based only on Larry's August 1999 disclosure to his patent attorney.

8. James Abel, another inventor, filed for a patent on circuitry and a case for use with a white light-emitting diode ("LED") bulb in a flashlight on October 1, 1998, and he was issued a patent on December 1, 1999. The claims in Abel's patent are essentially identical to Larry's invention.

Part 2: 16 points

Larry Lite obtained a patent on his flashlight and has gone into the LED flashlight business. He discovers that NiftyLite is marketing a cheap imported knock-off of his flashlight, which infringes the claims of his patent. Larry sues NiftyLite for patent infringement.

At trial, the evidence shows the following:

1. NiftyLite has sold 10,000 LED flashlights for $30.00 each since Larry's patent issued two years ago.
2. Larry and NiftyLite are the only sellers of LED flashlights, and conventional flashlights do not compete with LED flashlights.
3. All flashlights sold by Larry have his name and the words "U.S. Patent" together with the number of the patent embossed on the plastic case.
4. NiftyLight's flashlight cases are made from moulds developed from Larry's flashlight, with Larry's name and patent information removed.
5. Larry makes $10.00 on every LED flashlight that he sells.
6. Larry's invention is commercially successful, so successful that he cannot fill all of the flashlight orders that he receives.
7. The normal royalty rate in the flashlight industry for licenses to flashlight patents is 10% of gross sales.

SELECTED PORTIONS OF
TITLE 35 - UNITED STATES CODE

CHAPTER 10 - PATENTABILITY OF INVENTIONS

§ 101. Inventions patentable.

Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefore, subject to the conditions and requirements of this title.

§ 102. Conditions for patentability; novelty and loss of right to patent.

A person shall be entitled to a patent unless -

(a) the invention was known or used by others in this country, or patented or described in a printed publication in this or a foreign country, before the invention thereof by the applicant for patent, or

(b) the invention was patented or described in a printed publication in this or a foreign country or in public use or on sale in this country, more than one year prior to the date of the application for patent in the United States, or

(c) he has abandoned the invention, or

(d) the invention was first patented or caused to be patented, or was the subject of an inventor's certificate, by the applicant or his legal representatives or assigns in a foreign country prior to the date of the application for patent in this country on an application for patent or inventor's certificate filed more than twelve months before the filing of the application in the United States, or

(e) The invention was described in

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(2) a patent granted on an application for patent by another filed in the United States before the invention by the applicant for patent ...

(f) he did not himself invent the subject matter sought to be patented, or

(g)(1) during the course of an interference conducted under section 135 or section 291, another inventor involved therein establishes, to the extent permitted in section 104, that before such person's invention thereof the invention was made by such other inventor and not abandoned, suppressed, or concealed, or (2) before such person's invention thereof, the invention was made in this country by another inventor who had not abandoned, suppressed, or concealed it. In determining priority of invention under
this subsection, there shall be considered not only the respective dates of conception and reduction to practice of the invention, but also the reasonable diligence of one who was first to conceive and last to reduce to practice, from a time prior to conception by the other.

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CHAPTER 11 -APPLICATION FOR PATENT

§ 112. Specification.

The specification shall contain a written description of the invention, and of the manner and process of making and using it, in such full, clear, concise, and exact terms as to enable any person skilled in the art to which it pertains, or with which it is most nearly connected, to make and use the same, and shall set forth the best mode contemplated by the inventor of carrying out his invention.

The specification shall conclude with one or more claims particularly pointing out and distinctly claiming the subject matter which the applicant regards as his invention.

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CHAPTER 29 - REMEDIES FOR INFRINGEMENT OF

PATENT, AND OTHER ACTIONS

§ 284. Damages.

Upon finding for the claimant the court shall award the claimant damages adequate to compensate for the infringement, but in no event less than a reasonable royalty for the use made of the invention by the infringer, together with interest and costs as fixed by the court.

When the damages are not found by a jury, the court shall assess them. In either event the court may increase the damages up to three times the amount found or assessed. Increased damages under this paragraph shall not apply to provisional rights under section 154(d) of this title.

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§ 287. Limitation on damages and other remedies; marking and notice.

(a) Patentees, and persons making, offering for sale, or selling within the United States any patented article for or under them, or importing any patented article into the United States, may give notice to the public that the same is patented either by fixing thereon the word "patent" or the abbreviation "pat.", together with the number of the patent, or when, from the character of the article, this can not be done, by fixing to it, or to the package wherein one or more of them is contained, a label containing a like notice. In the event of failure so to mark, no damages shall be recovered by the patentee in any action for infringement, except on proof that the infringer was notified of the infringement and continued to infringe thereafter, in which event damages may be recovered only for infringement occurring after such notice. Filing of an action for infringement shall constitute such notice.

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