CJEU Recognizes Cross-Border Jurisdiction of National Courts, Long-Arm Jurisdiction of UPC
The Court of Justice of the European Union (CJEU) issued a decision significantly expanding the capabilities of both the Unified Patent Court (UPC) and the national courts in EU Member States to issue cross-border injunctions and adjudicate on patent infringement acts in countries (seemingly) outside their respective jurisdiction. Case C-339/22 (CJEU, Grand Chamber Feb. 25, 2025) ECLI:EU:C:2025:108.
Background
German company BSH Hausgeräte GmbH owns a European patent that is validated in several EU Member States and non-EU countries such as Turkey. BSH sued Swedish company Electrolux AB before a Swedish court for infringement of all national parts of the European patent (including the Turkish part).
Electrolux argued that the parts of the patent validated outside Sweden were invalid and that the Swedish court accordingly lacked jurisdiction to rule on these infringement claims. Electrolux relied on Article 24(4) of Regulation (EU) 1215/2012, the Brussels I bis Regulation, which confers exclusive jurisdiction for questions of patent validity on the courts of the state where a patent is registered.
The Swedish court of first instance declared that it did not have jurisdiction to rule on infringement of any non-Swedish parts of the patent. BSH appealed, and the Swedish Court of Appeal referred key questions to the CJEU about the interplay between Articles 4(1) and 24(4) of the Brussels I bis Regulation. Article 4(1) of the Regulation grants the courts of EU Member States general jurisdiction over all infringement actions committed by a person or company domiciled in their territory (regardless of where the infringement occurred). One of the relevant questions in this case was whether, in light of Article 24(4) of the Regulation, the court hearing the patent infringement action loses jurisdiction when an invalidity defense is raised.
Long-Arm Jurisdiction and Invalidity Defense
The CJEU clarified that Article 24(4) of the Regulation must be interpreted narrowly. According to the CJEU, the “validity of patents” mentioned in Article 24(4) of the Regulation only pertains to validity challenges that would lead to the annulment of the patent with effect erga omnes. Such erga omnes validity proceedings must still be brought before the courts of the forum of registration (e.g., the German Federal Patent Court in the case of the German part of a European patent). However, the CJEU considers that Article 24(4) of the Regulation does not apply to an inter partes invalidity defense raised in patent infringement litigation. Consequently, according to Article 4(1) of the Regulation, a court of an EU Member State in which the infringement case is being heard can decide on patent infringements in another EU Member State or in a third (non-EU) country and does not lose its jurisdiction if an invalidity defense is raised. Patent proprietors can therefore obtain cross-border injunctions in national courts of EU Member States (as well as before the UPC, even in states that do not take part in the UPC), and the courts remain jurisdictionally competent even if the infringer imposes an invalidity defense.
Where a third country outside of the European Union is concerned (e.g., the United Kingdom, Switzerland, or Turkey), the EU infringement court may even have jurisdictional competence to rule on an invalidity defense with inter partes effect. This means that a defendant can obtain a decision dismissing the infringement action on the basis of its invalidity defense (but not resulting in the patent being revoked in whole or in part, as there is no erga omnes effect of such invalidity decision).
Practical Implications
This decision marks a shift from the CJEU’s previous jurisprudence, according to which a cross-border injunction was blocked if the defendant raised an invalidity defense. The decision will also have significant implications for global patent litigation strategies:
Defendants cannot simply escape the forum chosen by the patentee by raising an invalidity defense. They may still file a separate nullity action in the country in which the patent or the relevant national part of a European patent is registered, but the EU infringement court will retain jurisdiction over the question of whether the defendant infringed the patent.
Patent proprietors can sue any defendant based in the European Union for patent infringement in any country (potentially worldwide) before the national courts of domicile. The question of patent infringement would then have to be decided on the basis of the applicable foreign law. This could require multinational litigation teams and expert opinions on foreign law (on matters such as claim construction) as well as possible uncertainty as to how an EU national court might interpret and apply foreign law, such as US or Chinese law. At least in principle, the CJEU’s decision allows EU courts to rule on patent infringement cases globally.
The owner of a non-opted-out European patent can now sue any defendant domiciled in a UPC contracting state for patent infringement, even with regard to infringing acts in European Patent Convention states that are not part of the UPC system (e.g., Spain or Turkey). There is already precedent on this issue (published even before the CJEU decision) in the decision of the UPC Local Division Düsseldorf of January 28, 2025, in the case UPC_CFI_355/2023. Here, the UPC recognized its long-arm jurisdiction regarding the alleged infringement of a European patent in the United Kingdom, even though an invalidity defense was raised and even though the United Kingdom is not part of the UPC system.
While the CJEU granted extensive jurisdiction to national courts and the UPC, it accepted that the infringement court must consider a nullity action in another EU Member State, which may lead to a stay of the infringement proceedings – in particular where the national court sees a “reasonable, non-negligible possibility of that patent being declared invalid” in the pending nullity action. As a result, defendants may have to file multiple nullity actions simultaneously before national courts if a patent owner decides to bring an action for patent infringement in several countries before only one national court. This could exert significant pressure on the defendant, which would have to advance considerable corresponding legal costs.
Practice Note: The CJEU decision strengthens the UPCs power to rule on allegations of infringement occurring in non-UPC countries. However, it also allows national courts in the EU to compete with the UPC in certain cross-border cases, particularly where a defendant domiciled in one country infringes in several countries. In its ruling, the CJEU confirmed the long-arm jurisdiction of both the national courts in the EU Member States and the UPC, and confirmed that raising an invalidity defense does not remove the jurisdiction of the infringement court.
A patent proprietor now can seek a cross-border injunction from a national court in the European Union without the risk of having several parts of its asserted European patent invalidated in a single counterclaim for revocation as in the UPC, but with a greater risk of a stay of infringement proceedings. Accordingly, the UPC has become an even more attractive venue for patent owners but could face additional competition from national courts. Patent proprietors will now be able to choose between EU national courts and the UPC when bringing infringement actions concerning multiple national designations and seeking cross-border injunctions, which translates into increased forum shopping possibilities. The CJEU’s decision may also lead to parallel proceedings in multiple jurisdictions, increasing the complexity of litigation for both parties.
This is where the UPC offers less costly and faster decisions. Because the CJEU confirmed the UPC’s competence to adjudicate on infringement issues related to European patents validated in non-UPC countries (such as the United Kingdom, Spain, Switzerland, and Turkey), the UPC is the more attractive option, especially for patentees with global patent portfolios. Overall, the CJEU’s decision strengthened the role of the UPC in European patent litigation but also introduced new dynamics that may influence cross-border patent litigation strategies.
The decision strengthens the relevance of EU-based courts in global patent litigation and underscores the need for cross-border strategies. Only time will tell whether non-EU courts will also affirm long-arm jurisdictions.
Premier Li Qiang Delivers China’s 2025 Work Report – Strengthen the Protection of Intellectual Property
On March 5, 2025, Premier Li Qiang delivered the 2025 government work report on behalf of the State Council at the third session of the 14th National People’s Congress. The work report set up economic and development tasks for 2025 providing insights on how China plans to achieve its economic goals. Excerpts relating to science, technology, and intellectual property follow. More insight into intellectual property goals for 2025 will presumably follow in the Supreme People’s Court’s work report scheduled for March 8, 2025.
The opening ceremony of the third session of the 14th National People’s Congress was held in the Great Hall of the People in Beijing.
The first part of the report, the 2024 work report, mentioned:
We will vigorously promote innovation-driven development and promote the optimization and upgrading of the industrial structure. We will advance the construction of a strong country in science and technology , fully launch and implement major national science and technology projects , accelerate the improvement of major science and technology infrastructure systems , and strengthen the training of top innovative talents .
Part II, the overall requirements and policy orientations for economic and social development in 2025, mentions:
Promote the integrated development of scientific and technological innovation and industrial innovation .
Part III of the 2025 government work tasks mentioned:
We will develop new quality productive forces in accordance with local conditions and accelerate the construction of a modern industrial system. We will promote the integrated development of scientific and technological innovation and industrial innovation , vigorously promote new industrialization, expand and strengthen advanced manufacturing, actively develop modern service industries, and promote the accumulation of new momentum and the renewal and upgrading of traditional momentum.
Cultivate and expand emerging industries and future industries. Deepen the integrated cluster development of strategic emerging industries. Carry out large-scale application demonstration actions for new technologies, new products and new scenarios, and promote the safe and healthy development of emerging industries such as commercial aerospace and low-altitude economy. Establish a mechanism for the growth of investment in future industries, and cultivate future industries such as biomanufacturing, quantum technology, artificial intelligence, and 6G . Deepen the pilot program for the integrated development of advanced manufacturing and modern service industries, and accelerate the development of service-oriented manufacturing. Strengthen the overall layout of industries and capacity monitoring and early warning, and promote the orderly development of industries and healthy competition. Accelerate the innovative development of national high-tech zones. Gradual cultivation of innovative enterprises , promote the development and growth of specialized, refined and new small and medium-sized enterprises, support the development of unicorn enterprises and gazelle enterprises , and allow more enterprises to accelerate in new fields and new tracks.
Stimulate the innovative vitality of the digital economy. Continue to promote the “artificial intelligence +” action , better combine digital technology with manufacturing advantages and market advantages, support the widespread application of large models, and vigorously develop a new generation of intelligent terminals such as intelligent networked new energy vehicles, artificial intelligence mobile phones and computers, and intelligent robots, as well as intelligent manufacturing equipment. Expand the large-scale application of 5G, accelerate the innovative development of the industrial Internet, optimize the national computing power resource layout, and create a digital industry cluster with international competitiveness. Accelerate the improvement of the basic data system , deepen the development and utilization of data resources, and promote and standardize the cross-border flow of data. Promote the standardized and healthy development of the platform economy , and better play its positive role in promoting innovation, expanding consumption, and stabilizing employment.
We will implement the strategy of rejuvenating the country through science and education, and improve the overall efficiency of the national innovation system. We will insist on innovation-driven development, promote education development, scientific and technological innovation, and talent cultivation in an integrated manner, and build a solid foundation and strategic support for China’s modernization.
Promote high-level scientific and technological self-reliance and self-improvement. Give full play to the advantages of the new national system , strengthen key core technology research and development and cutting-edge and disruptive technology research and development, and accelerate the organization and implementation of major scientific and technological projects . Optimize the layout of national strategic scientific and technological forces, promote the reform of scientific research institutes, explore new scientific research organization models of national laboratories, and enhance the radiation and driving capacity of international and regional scientific and technological innovation centers. Promote the tilt of scientific and technological expenditure towards basic research, improve the investment mechanism that combines competitive support with stable support, and improve the degree of organization of basic research. Give full play to the leading role of science and technology leading enterprises, strengthen the deep integration of industry, academia and research led by enterprises, and institutionally guarantee that enterprises participate in national scientific and technological innovation decision-making and undertake major scientific and technological projects. Improve the allocation and management and use mechanism of central fiscal science and technology funds. Improve the support policies and market services for the transformation of scientific and technological achievements, promote the reform of empowerment of official scientific and technological achievements and separate asset management , and improve the efficiency of scientific and technological achievements transformation. Strengthen the protection and application of intellectual property rights. Accelerate the construction of concept verification, pilot verification and industry common technology platforms. Improve the differentiated supervision system of venture capital funds, strengthen policy-based financial support, accelerate the development of venture capital, and strengthen patient capital. Expand scientific and technological openness and cooperation. Strengthen science popularization work and improve citizens’ scientific literacy. Carry forward the spirit of scientists and promote the formation of an innovative environment that encourages exploration and tolerates failure.
The full text is available here (Chinese only).
Federal Circuit Refuses to Rehear Case Involving Orange Book Listing of Device Patents
Late last year we reported on the United States Court of Appeals for the Federal Circuit decision holding that certain device patents should not have been listed in the FDA’s Orange Book since the claims of the patents in question did not recite the active drug substance.
Following that decision, the brand company patent holder, Teva, filed a petition to request the Federal Circuit to rehear the case in front of all judges in the Circuit. Teva’s position was supported by a number of brand pharmaceutical companies, as well as the Pharmaceutical Research and Manufacturers of America.
On Monday, March 3, 2025, the Federal Circuit entered an Order denying Teva’s rehearing request. Teva may still attempt to appeal the December 2024 Federal Circuit decision to the United States Supreme Court, but there is no guarantee that the Supreme Court will agree to hear the case.
If left undisturbed by the Supreme Court or further legislative or regulatory actions, the Federal Circuit decision begins to provide some clarity regarding whether device patents can be listed in the Orange Book when they do not recite the active ingredient. Either way, further litigation involving Orange Book patent listings can be expected. It will be important for both brand and generic companies to carefully review the specific language of all patent claims that may be or are currently in the Orange Book for approved drugs where there are device components associated with the drug.
SCOTUS Rules that Trademark Infringement Plaintiff Cannot Marry ‘Single’ Dewberry Defendant to Affiliates’ Profits
Go-To Guide:
Supreme Court rules trademark infringement plaintiffs can’t claim profits from defendant’s corporate affiliates.
Decision emphasizes importance of corporate separateness in trademark cases.
Trademark plaintiffs may consider broader strategies when identifying potential defendants.
Courts may still examine “economic realities” to determine a defendant’s true financial gain.
On Feb. 26, 2025, the U.S. Supreme Court issued its opinion in Dewberry Group, Inc. v. Dewberry Engineers Inc. The Court considered whether a defendant in a trademark infringement suit can be held liable for the profits its non-party corporate affiliates earn under the provisions of Lanham Act Section 35(a) that allow for recovery of “the defendant’s profits.” In a decision that may have ramifications for how future trademark infringement cases are litigated, the Supreme Court held that a court can award only profits that are properly ascribable to the defendant. Background
The case involved two companies – Dewberry Engineers and Dewberry Group – doing business in the commercial real estate sector in the southeastern United States.
Dewberry Group, owned by developer John Dewberry, provided shared legal, financial, operational, and marketing services to Mr. Dewberry’s various separately incorporated companies, each of which owned a piece of commercial property for lease. The lessors kept their rental income on their own books and paid Dewberry Group below-market services fees. As a result, shared service provider Dewberry Group operated at a loss for decades while the property-owning affiliates raked in tens of millions of dollars in profit.
For nearly two decades, Dewberry Engineers, owner of a federal trademark registration for the mark DEWBERRY, tried to enforce its rights against Dewberry Group. A 2007 settlement agreement between the parties fell apart when Dewberry Group, about a decade later, resumed using the “Dewberry” name in materials marketing its affiliates’ properties.
Dewberry Engineers sued Dewberry Group for trademark infringement under the Lanham Act and won. Finding Dewberry Group’s infringement “intentional, willful, and in bad faith,” the district court awarded Dewberry Engineers “the defendant’s profits” under Lanham Act Section 35(a). The sole named defendant in the case – Dewberry Group – reported no profits. Nonetheless, the district court, finding that the profits from Dewberry Group’s conduct “show up exclusively on the [property-owning affiliates’] books,” decided to treat Dewberry Group and its affiliates “as a single corporate entity” to reflect the “economic reality” of their relationship. The court thus totaled the profits the affiliates earned during the years of Dewberry Group’s infringement and awarded nearly $43 million to Dewberry Engineers.
On appeal, a divided Court of Appeals for the Fourth Circuit affirmed the profits award, adopting the district court’s rationale that the “economic reality” of Dewberry Group’s relationship with its affiliates mandated that all the companies be treated “as a single corporate entity.” Thereafter, the Supreme Court granted Dewberry Group’s petition for certiorari.
The Supreme Court Opinion
Justice Kagan, writing for a unanimous Court, began her analysis by examining the language of Lanham Act Section 35(a), which provides in relevant part that a prevailing plaintiff in a trademark infringement suit may recover “the defendant’s profits.” Noting that the term “defendant” is not specifically defined in the Lanham Act, Justice Kagan looked to the definition in Black’s Law Dictionary, which defines “defendant” as “the party against whom relief or recovery is sought in an action or suit.” In this case, Justice Kagan noted, the “defendant” is “Dewberry Group alone” and that Dewberry Engineers “chose not to add the Group’s property-owning affiliates as defendants.”
Justice Kagan observed that treating Dewberry Group and its affiliates as a single corporate entity ran afoul of the principle of corporate separateness. She reasoned that “if corporate law treated all affiliated companies as (in the district court’s phrase) ‘a single corporate entity,’ we might construe ‘defendant’ in the same vein” and “sweep[ ] in the named defendant’s affiliates because they lack a distinct identity.” But as Justice Kagan pointed out, “[i]t is long settled as a matter of American corporate law that separately incorporated organizations are separate legal units with distinct legal rights and obligations.” In the absence of any exception to this rule, such as piercing the corporate veil to prevent fraudulent conduct (which Dewberry Engineers neither alleged nor proved), “the demand to respect corporate formalities remains.”
Justice Kagan dispensed with Dewberry Engineers’ argument that a court may take account of an affiliate’s profits under the so-called “just sum provision” in Section 35(a). Under that provision, “[i]f the court shall find that the amount of the recovery based on profits is either inadequate or excessive, the court may in its discretion enter judgment for such sum as the court shall find to be just, according to the circumstances.” Dewberry Engineers argued that this provision entitled courts to determine that a different figure than a defendant’s profits better reflects the “defendant’s true financial gain.” But as Justice Kagan wrote, the courts below did not invoke the just sum provision and, in any event, “the fear that ‘corporate formalities’ would . . . insulate infringing conduct from any penalty . . . cannot justify ignoring the distinction between a corporate defendant and its separately incorporated affiliates.” Because the courts below approved an award including non-defendants by treating the defendant and its affiliates as a single corporate entity, their holding “went further than the Lanham Act permits.”
The Court expressed no view on Dewberry Engineers’ understanding of the just sum provision, because whether or how they could have used the provision was not properly before the Court. Importantly, the Court left open the possibility that a lower court, even without relying on the just sum provision, could “look behind a defendant’s tax or accounting records to consider ‘the economic realities of a transaction’ and identify the defendant’s ‘true financial gain.’”
In a concurring opinion, Justice Sotomayor emphasized that Section 35(a) directs courts to calculate the defendant’s profits “subject to the principles of equity.” Those principles, she wrote, “support the view that companies cannot evade accountability for wrongdoing through creative accounting.” Thus, the text of the Lanham Act “forecloses any claim that Congress looked favorably on easy evasion.”
Takeaways
The Court’s opinion leaves no doubt that a trademark infringement plaintiff cannot rely on the “single corporate entity” approach to capture the profits of a parent company, child company, sister company, or other affiliate. Accordingly, plaintiffs should consider casting a wide net in their initial complaints and be prepared to amend their complaints to include additional defendants as discovery progresses. In anticipation of such wider nets, both intracompany and intercompany agreements should be thoughtful and strategic in their approaches to indemnification, knowing that the likelihood of an entity having to prove its non-involvement in alleged wrongdoing may increase.
Because the Supreme Court’s ruling was narrow, in future cases, courts may face the issues of whether and how to examine the economic realities of complex corporate structures involving multiple interrelated affiliates. This may involve extensive fact discovery and expert testimony on not only the propriety of such arrangements (i.e., whether the defendant sought to divert profits through accounting sleight of hand) but also consideration of whether the profits at issue can, in Justice Kagan’s words, be “properly ascrib[ed] to the defendant itself.”
The focus on “principles of equity” Justice Sotomayor espoused may provide a more viable approach to the question of whose profits to measure than the just sum provision Dewberry Engineers advanced before the Supreme Court, which primarily asks how much, not whom. The just sum provision intends to give a district court leeway to increase or decrease an award of the defendant’s profits considering the circumstances; it is not meant to allow a plaintiff to sweep up the profits non-party affiliates earned. On the other hand, because profit disgorgement is an equitable remedy, the Supreme Court’s decision may encourage trademark infringement plaintiffs to invoke the equitable powers the Lanham Act bestows upon courts to attempt to unweave creative accounting, tax, and corporate schemes and arrive at an award that reflects the defendant’s true financial gain.
No Harm, No Foul – CIPA Claims Dismissed for Lack of Standing
The deluge of lawsuits and demand letters under the California Invasion of Privacy Act (CIPA) has prompted courts to scrutinize CIPA claims more rigorously, including the threshold question of whether CIPA plaintiffs have standing to sue. Recent federal and state court decisions have now answered the standing question in the negative, and the resulting dismissals of CIPA litigation may indicate some relief from the CIPA onslaught.
For example, in Gabrielli v. Insider, Inc., No. 24-cv-01566 (ER), 2025 WL 522515 (S.D.N.Y. Feb. 18, 2025), plaintiff claimed that the defendant violated CIPA’s restrictions as to pen registers by deploying technology on its website that captured and sent plaintiff’s IP address to a third party. As is typical in CIPA litigation, plaintiff argued that the mere statutory violation itself was sufficient to confer standing. The district court disagreed. Citing TransUnion LLC v. Ramirez, 594 U.S. 413 (2021), the district court found that plaintiff had failed to identify any harm from the alleged sharing of an IP address that was analogous to privacy interests protected under common law, rejecting plaintiff’s position that an IP address necessarily implicates “a legally protected privacy interest[.]” The district court also rejected plaintiff’s argument that CIPA’s pen register restrictions codified any substantive privacy right, holding that the alleged violation was at most a “bare procedural violation, divorced from any concrete harm.” Finding that these deficiencies could not be cured by amendment, the court dismissed the complaint without leave to amend.
Although California state courts apply a slightly different analysis, these courts generally require that a plaintiff allege a concrete injury or allege the violation of a statute that authorizes public interest lawsuits by plaintiffs not injured by the statutory violation. See, e.g., Muha v. Experian Info. Sols., Inc., 106 Cal. App. 5th 199, 208-09 (2024). A series of trial court decisions have recently concluded that CIPA is not such a statute and have dismissed lawsuits based on the premise that a mere statutory violation is insufficient to support standing. See, e.g., Rodriguez v. Fountain9, Inc., No. 24STCV04504, 2024 WL 4905217 (Cal. Super. Ct. L.A. Cty. Nov. 21, 2024). Although these decisions are not citable in California state court, they can be invoked in response to demand letters—or their reasoning deployed in motions to dismiss.
This trend further suggests that courts will continue to challenge individual and putative class action litigation brought on the premise that any CIPA violation confers sufficient standing. These decisions may stem the tide of further litigation in this area and provide companies with an additional basis to reject increasingly indiscriminate CIPA claims.
Copyright Litigation Ruling Spotlights Applicability of Fair Use as a Defense When Training AI
Highlights
A federal court held in a copyright infringement case the defendant could not maintain its “fair use” and other defenses
While curated and organized legal content is protected by copyright law, repurposing it to build a direct competitor and utilizing it to train AI pushes beyond fair use protections
Fair use is not a shield when AI training on copyrighted legal compilations directly undermines the original creator’s market and competitive edge
In a recent twist to a closely followed AI-related copyright infringement case between two legal research software providers, a federal court reversed its prior rulings and held the company accused of copyright infringement could not maintain its “fair use” and other defenses.
The court initially denied the parties’ cross-motions for summary judgment in September 2023, citing factual issues as to both whether the headnotes were sufficiently original to warrant copyright protection, as well as factual issues on elements of a fair use defense. Before the scheduled trial date in August 2024, the court continued the trial date and requested the parties to submit additional briefing.
After finding the defendant directly copied over 2,000 “headnotes,” or summaries of legal opinions, and that the headnotes were sufficiently original and copyrightable, the court spent most of its opinion focused on the defendant’s claim that the copying of data to train AI was excused under the fair use defense. The court considered the four factors that are weighed when assessing a claim of fair use, the: 1) purpose and character of the use, 2) nature of the copyrighted work, 3) amount and substantiality of the portion used, and 4) effect of the use upon the potential market for or value of the copyrighted work.
While the court found that the second and third factors weighed in the defendant’s favor, because the headnotes were not as original or creative as fictional works and the defendant’s AI product did not directly reproduce the copied headnotes, the court found that the two most important factors weighed in the plaintiff’s favor. Specifically, the court found that the purpose of the challenged use was commercial, and that the defendant intended to compete directly the incumbent plaintiff from the legal research market and enter the market of providing AI-powered legal research tools.
The court also noted that it did not matter if the plaintiff also intended to train its own AI tools on its headnotes, as the effect on the potential market was enough for the fourth factor to weigh in the plaintiff’s favor.
Importantly, the court took care to distinguish the AI tools in question from generative AI tools. The court found it important that the AI tools being challenged were trained on copyrighted works and only returned relevant judicial opinions based on its training to a user’s queries – not generate new output in response to prompts. The court explicitly left open the question of whether the fair use defense could succeed where generative AI tools are at issue and whether generative AI would change the analysis of a direct competitor creating content from an incumbent’s content.
Takeaways
This ruling reinforces copyright protections for curated legal research materials and signals stricter scrutiny for AI-driven data scraping in competitive industries. Additionally, it highlights a growing legal challenge for AI developers relying on proprietary datasets for training models.
IPO Introduces Survey to Steer Future of UK Design Law
On February 25, the United Kingdom (UK) Intellectual Property Office (IPO) launched a survey to collect feedback on potential changes to the UK’s design protection framework. The goal is to ensure that the system remains relevant, accessible, and effective in supporting designers and businesses across various industries. This initiative follows a previous call for views in 2022, with insights from the survey informing a formal consultation later in 2025.
The survey will remain open until April 1, and responses will help shape future policy decisions regarding intellectual property (IP) protections for designs.
A key focus of the survey is to evaluate five core principles for an improved design protection system:
Cost – Ensuring that the system is affordable and provides good value for money.
Validity – Ensuring clarity on what constitutes a valid design and the strength of associated IP rights.
Speed – Making design protection quicker to obtain and enforce.
Choice – Providing a flexible system that accommodates different needs.
Simplicity – Reducing complexity in accessing and managing design protections.
Beyond these principles, the survey also examines the scope of what should be legally protected as a “design.” Currently, UK IP law defines a design more narrowly than its common usage, protecting only the visual appearance of a product or its elements that are visible in normal use. This raises concerns about whether the current framework adequately meets the needs of designers, consumers, and businesses, particularly in an increasingly digital landscape.
Chris Mills, UKIPO’s director of rights policy, emphasized the importance of public participation in shaping the future of design protection. He encouraged a wide variety of stakeholders, including designers, businesses of all sizes, legal professionals, trade bodies, and other interested parties, regardless of their level of IP expertise, to share their insights and experiences.
Despite sentiments of weariness following the recent request for feedback in 2022, the UKIPO emphasizes the importance of this survey in shaping a more effective and accessible design protection framework. The agency seeks to address ongoing concerns and adapt the system to better serve the needs of designers and businesses in the evolving creative landscape. The feedback gathered will help modernize the UK’s design framework and ensure it supports innovation, economic growth, and competitiveness in global markets.
By engaging with this process, participants can contribute to shaping a design protection system that is more accessible, efficient, and adaptable to emerging industry needs. With results from the survey, the UKIPO aims to create a legal framework that keeps pace with technological advancements and evolving business practices while safeguarding designers’ rights.
Veil-Piercing Update: Supreme Court Restores the Status Quo, For Now
The US Supreme Court unanimously declined to reshape the corporate veil-piercing doctrine when presented with the opportunity to do so in Dewberry Group, Inc. v. Dewberry Engineers, Inc. On February 26, 2025, the Supreme Court issued an opinion vacating and remanding the US Court of Appeals Fourth Circuit’s decision affirming an award in a trademark infringement dispute under the Lanham Act that included disgorgement of profits from the named defendant’s non-party corporate affiliates. (Bracewell previously reported on this case in a client alert on November 20, 2024.) The Supreme Court held that because the affiliates were not joined as parties, and because they were separate corporate entities, they could not be made responsible for the defendant’s damages in the absence of a finding that the traditional standards for corporate veil-piercing had been met.
In vacating and remanding the decision, the Supreme Court rejected the US District Court for the Eastern District of Virginia’s treatment of the defendant and its non-party affiliates as a single corporate entity and instead interpreted the Lanham Act’s use of the term “defendant’s profits” to refer only to corporate defendants that were actually included as parties in the suit. Thus, the Court ruled that the District Court should not have included the profits of a non-party defendant in its damages award. Additionally, the Court ruled that the Fourth Circuit and the District Court had not undertaken an adequate analysis under the statute’s relevant provisions before considering the profits of the defendant’s non-party affiliates.
Notably, however, the Supreme Court declined to address several issues: whether proper use of the Lanham Act’s “just-sum” provision could result in a profit disgorgement award that includes profits of non-party entities; whether courts should look beyond the “just-sum” provision and into the “economic realities” of a defendant’s affiliates, an approach suggested in an amicus curiae brief submitted by the United States; and whether corporate veil-piercing is “an available option on remand.”
Justice Sotomayor, joining the majority opinion in full, authored a concurrence to encourage lower courts to consider the “economic reality” argument put forth by the United States in its amicus curiae brief. Under this approach, a court could look to non-arm’s-length relationships between defendant corporations and affiliates, or below-market rates charged by defendant corporations to affiliates for trademark-infringing services. Justice Sotomayor emphasized, “courts must be attentive to practical business realities for a Nation’s trademark laws to function, and the Lanham Act gives courts the power and the duty to do so.”
In response to the Supreme Court’s remand, the District Court could more fully engage in a “just-sum” analysis under the Lanham Act. Alternatively, the District Court could consider a veil-piercing approach or another equitable strategy to uncover the “economic reality” of the infringing party. For now, however, the traditional standards for corporate veil-piercing remain intact.
Patents Expose Celebrities
In December 2024, we wrote about the many celebrities involved in the production of their own works and some of the resultant U.S. patent office activity. Many more celebrities have invented products not directly related to their day jobs. Below are tales about a few more and because its March, we thought it a perfect […]
The post Patents Expose Celebrities appeared first on Attorney at Law Magazine.
USPTO Show Cause Order to Cancel More Than 40,000 China-Originated Trademark Registrations, Shenzhen Responds
In a February 24, 2025 Show Cause Order against Shenzhen Seller Growth Network Technology Co., Ltd. et al., the United States Patent & Trademark Office (USPTO) announced that about 42,000 trademark registration decisions might be vacated and the application or post-registration proceedings reopened for a new determination to be made. For an initial registration decision, the registration will be cancelled and restored to pendency under its application serial number. The reopened proceeding is a proceeding that may be subject to termination.
The USPTO stated the “integrity of the USPTO’s examination and decision-making processes were tainted at their core and the USPTO’s registration decisions were premised on false representations and assumptions.”
This show cause order supplements two prior show cause orders dated September 7, 2022 and November 27, 2023. In the first show cause order, the USPTO stated that Seller Growth practiced “unauthorized practice before the USPTO in trademark matters and providing false, fictitious, or fraudulent information in trademark submissions with the intent to circumvent these rules.”
The USPTO also stated, “that the evidence indicates that Respondents are not qualified practitioners under 37 C.F.R. §§ 11.1 and 11.14, yet still engaged in the unauthorized practice of law through the use of names and bar credentials of U.S.-licensed attorneys, intentionally provided for the purpose of concealing Respondents’ involvement and circumventing USPTO rules.” Further, “Respondents’ efforts to mask their participation in the unauthorized practice of law include improperly entering the electronic signatures of at least three U.S.-licensed attorneys and providing false, fictitious, and/or fraudulent attorney information in trademark filings in violation of USPTO Rules.”
At the time, Seller Growth responded that
The USPTO is currently conducting a routine review of the trademark agency industry in China. As the largest international intellectual property SaaS platform in China, our company has been listed in the first batch of inquiries to undergo routine review. It is currently undergoing a normal review, and there is no so-called sanctions by the USPTO, and the relevant rumors are all rumors.
This inquiry will not have any impact on the customers we have served and future customers. Trademarks can continue to be used normally.
Maliciously spreading rumors and smearing our company has seriously damaged the legitimate rights and interests of our company. Please stop the rumors and slander immediately and delete the untrue information that has been released. Otherwise, our company will take legal measures to pursue it to the end.
Seller Growth’s 2022 Online Response – Nothing to Worry About
On February 28, 2025, the Shenzhen Intellectual Property Protection Center provided advice for those affected:
Recently, the Shenzhen Intellectual Property Protection Center (hereinafter referred to as the “Shenzhen Protection Center”) monitored an incident of suspected illegal agency for U.S. trademark applications .
On February 24, 2025, the United States Patent and Trademark Office (hereinafter referred to as the “USPTO”) issued a supplementary order to show cause and a notice that the USPTO proposes to reconsider its registration decision on its official website (SUPPLEMENTAL ORDER TO SHOW CAUSE AND NOTICE THAT THE USPTO PROPOSESTO RECONSIDER ITS REGISTRATION DECISIONS), accusing Shenzhen Seller Growth Network Tech. Co., Ltd. and two affiliated companies (1, Shenzhen Qianhai Bishengdao; 2, Shenzhen Qianhai Be-Victory Network Tech. Co., Ltd.) [The English names of the two companies are actually different English translations of the same entity, and have now been renamed Chenhaiyun (Shenzhen) Technology Co., Ltd.] (hereinafter referred to as the “involved institutions”) of circumventing due review procedures through improper means such as forging signatures and providing false attorney information, in violation of U.S. trademark law.
I. Basic Situation of the Incident
The USPTO notified the relevant institutions and enterprises that own the trademarks involved through a supplementary order to show cause that it plans to cancel the registration status of the relevant trademarks in the administrative sanctions procedure against the relevant institutions. The application dates of the trademarks involved in this case span the period from 2010 to 2023, involving 41,741 trademarks. At the same time, this supplementary order to show cause set a deadline (March 26, 2025), requiring the relevant entities to provide written evidence and responses to the preliminary sanctions, otherwise they may face cancellation procedures. The list of trademarks involved is detailed in the attachment.
2. Response Strategies
The enterprises involved can check according to the attachments, assess risks, and take timely measures to avoid affecting normal operations and trademark layout. They can re-entrust qualified agencies to submit applications, but they must strictly comply with regulations and avoid providing false information. The trademark can be redesigned. If the resubmitted trademark application is consistent with the trademark involved, the USPTO may raise the review standards and extend the review period for such applications.
In addition, the companies involved can refer to the research reports and practical guidelines previously released by the Shenzhen Protection Center, such as the “U.S. Trademark Opposition and Revocation System”, “Amazon U.S. Trademark Registration Guidelines”, and “Cross-border E-commerce Intellectual Property Compliance Guidelines” to obtain more guidance information on trademark registration and protection.
III. Advice on Trademark Application in the United States
There are some differences between trademark applications in the United States and in China. When applying for a trademark in the United States, trademark applicants should pay attention to the following points:
First, carefully select the agency. It is recommended that enterprises entrust a formal and professional intellectual property agency to apply for overseas trademarks, or directly entrust an American lawyer to submit. Regardless of direct or indirect entrustment, you can search and query through the official US website to verify the true identity of the American attorney to prevent the risk of the US trademark being revoked due to non-compliance with the registration. The cost of US trademark application generally includes official fees, US attorney fees and agency service fees. Enterprises should not blindly choose an agency because of the low price.
Second, choose the application category reasonably. The US trademark classification is more detailed than that of China. Applicants should carefully choose the categories of goods and services. In the registration process and later maintenance, the submission of evidence of use is involved. If the company selects too many categories in the early stage and fails to provide evidence of use within the deadline, the trademarks in the relevant categories will face the risk of being revoked, thereby generating unnecessary layout costs. Therefore, companies should reasonably choose the categories of trademark applications based on their own business development plans.
Third, ensure that the evidence of use is in compliance with regulations. According to the regulations of the USPTO, evidence of use should be submitted 5-6 years after the trademark is authorized and when it is renewed after 10 years. It is recommended that enterprises retain the actual use evidence of all products and ensure that the trademarks to be submitted must be trademarks that are actually used or intended to be used. False evidence of use cannot be created for the purpose of saving money or speeding up, otherwise it will constitute a false application and increase the risk of trademark rejection or revocation.
If enterprises encounter the above-mentioned problems, it is recommended to understand and verify the relevant situation. If further guidance is needed or if there are any questions during this process, they can contact the Shenzhen Protection Center at any time.
The USPTO Show Cause Order is available here (English only). The Shenzhen Intellectual Property Protection Center’s advice can be found here (Chinese only).
Chinese Copyright Registrations Up 19% in 2024
Per a release (国版发函〔2025〕4号) from the National Copyright Administration of China dated February 28, 2025, the total number of copyright registrations in China for 2024 reached 10,630,610, a year-on-year increase of 19.13%. Of these, 2,827,213 registrations were for computer software copyright registrations in 2024, an increase of 13.31% year-on-year. Other copyright registrations totaled 7,802,965 in 2024, an increase of 21.39% year-on-year.
China has experienced a significant decrease in copyright pledges, where copyrights are used as collateral to secure loans. Note it is unclear if these figures represent copyright as the sole collateral or if other property was part of the collateral. A total of 432 copyright pledge registrations were completed nationwide in 2024, a year-on-year increase of 5.11%; the number of contracts involved was 287, a year-on-year decrease of 24.87%; the number of works involved was 1,934, a year-on-year decrease of 7.11%; the amount of principal debt involved was 4,677,082,500 yuan, a year-on-year decrease of 53.03%; the amount of guarantee involved was 4,101,351,700 RMB, a year-on-year decrease of 58.40%.
Of the 432 pledges, there were 267 registrations of pledges of computer software copyright, a year-on-year decrease of 26.04%; the number of contracts involved was 267, a year-on-year decrease of 26.04%; the number of software involved was 1,769, a year-on-year decrease of 12.94%; the amount of principal debt involved was 4,500,786,200 RMB, a year-on-year decrease of 50.93%; the amount of guarantee involved was 3,909,290,200 RMB, a year-on-year decrease of 56.92%.
The original release is available here (Chinese only).
Spilling Secrets Podcast: Trade Secrets in Hollywood: Lessons from Oscar-Nominated Films [Podcast]
In this episode of Spilling Secrets, Epstein Becker Green attorneys Daniel R. Levy, Aime Dempsey, and George Carroll Whipple, III, explore trade secrets through the lens of Oscar-nominated films, offering insights into protecting sensitive information in today’s competitive landscape.
Whether looking at a magical spellbook from Wicked or groundbreaking architectural designs in The Brutalist, the discussion underscores how trade secrets intertwine with innovation, employee training, and organizational culture. Discover how Hollywood’s biggest stories offer practical lessons for safeguarding your business’s most valuable assets.