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 […]
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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.
If You’re Not First, You’re Last: IP Edition
You may notice that this is the first IP column by Z. Peter Sawicki with a new co-author! Fear not, James L. Young is still involved, sharing wisdom and providing editorial guidance, and is available to share practice tips and anecdotes in our musings about intellectual property. In this article, we want to discuss “firsts” […]
The post If You’re Not First, You’re Last: IP Edition appeared first on Attorney at Law Magazine.
M&A Playbook for Acquiring AI-Powered Companies
As artificial intelligence (AI) continues to transform the business world, acquirors need to prepare for a deep dive when evaluating companies that use AI to enable their businesses or create proprietary AI. Key considerations for buyers targeting AI-driven companies include understanding how AI is being used, assessing the risks associated with AI creation and use, being mindful of protecting proprietary AI technology, ensuring cybersecurity and data privacy, and complying with the regulatory landscape.
Risk Allocation
When acquiring a company that utilizes AI, it is vital to assess the potential risks associated with the AI technologies and their outputs. Buyers should review the target’s third-party contracts to understand how risks are allocated, including warranties, limitations of liability, and indemnification obligations. Buyers should also evaluate potential liabilities by considering where AI-generated content might infringe on copyrights or where AI malfunctions could lead to breaches of commitments or cause harm. Finally, buyers should analyze the target’s insurance coverage to ensure the company has adequate policies in place to cover potential third-party claims related to AI usage.
Protection of Proprietary AI Technology
For companies that have developed proprietary AI technologies, understanding how these assets are protected is essential. Buyers can take steps to mitigate liabilities associated with this area by reviewing the target’s intellectual property strategies. This can include a review of the target’s approach to protecting AI technologies, including patents, copyrights, and trade secrets. Additionally, the target’s security measures should be thoroughly analyzed so the buyer can confirm that reasonable measures are in place to maintain the secrecy of AI models, such as robust information security policies and nondisclosure agreements.
Cybersecurity and Data Privacy
If the target company uses personal or sensitive data in their AI technologies, buyers need to take a closer look at the target’s data protection practices. For example, buyers should assess the target’s compliance with applicable privacy laws and regulations, as well as conduct an evaluation of the target’s compliance measures with respect to data-transfer requirements in applicable jurisdictions. Further, the target’s third-party vendor contracts must include appropriate obligations for data privacy and cybersecurity.
Compliance Support and Regulatory Landscape
Finally, a rapidly evolving regulatory environment around AI requires M&A buyers to ensure that target companies can adapt to new regulations. Buyers can examine the target’s systems for overseeing AI use and addressing regulatory challenges, such as minimizing bias and ensuring transparency. Organizational support is also essential, and the buyer should consider what resources the target company has in place to address compliance issues related to AI that may arise.
Implications for M&A Buyers
As AI continues to advance and integrate into various sectors, M&A buyers need to stay ahead of the game when it comes to the unique challenges of acquiring AI-driven companies. By conducting thorough due diligence in the areas addressed above, buyers can better assess potential liabilities and ensure a smoother integration process. By focusing on and understanding these key areas, buyers not only mitigate risk but also position themselves to capitalize on the strategic advantages of AI technologies. In turn, buyers can make informed decisions that protect their investments and leverage AI for future growth.
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