Amazon, Aaron Swartz, BBC, Kappos: Intellectual Property

Amazon.com Inc., the world’s largest online retailer, has received a patent covering a marketplace for used digital objects.

Patent 8,364,595 was issued to the Seattle-based company Jan. 29, according to the database of the U.S. Patent and Trademark Office.

According to the patent, a limit could be set on the number of transfers permitted to a digital object, such as music, film or a book. If an attempt is made to transfer the object beyond the threshold permitted number of transfers or downloads, the ability to move could be considered impermissible and suspended or terminated.

Amazon said in the patent that this technology works around the ability to produce multiple copies of a digital object. Controlling the number of times such an object is transferred or downloaded controls the scarcity of that item. Too-easy copying can eliminate that scarcity, according to the patent.

A secondary market which allows users to effectively and permissibly transfer “used” digital objects to others while maintaining scarcity is therefore desired, Amazon said.

The company applied for the patent in May 2009, with the assistance of Lee & Hayes PLLC of Spokane, Washington.

For more patent news, click here.

Trademark

Five Firms, Individuals Charged With Importing Illegal Toys

Five individuals and five closely held companies were charged with importing hazardous and counterfeit toys into the U.S. from China.

Chenglan Hu, 51, Hua Fei Zhang, 52, Xiu Lan Zhang, 60, Guan Jun Zhang, 29, and Jun Wu Zhang, 28, were charged in a 24-count indictment unsealed yesterday in Brooklyn, New York, federal court.

The defendants used several companies including Family Product USA Inc., H.M. Import USA Corp. and ZCY Trading Corp. in a scheme to import toys that violate U.S. consumer safety laws and knockoff toys featuring Dora the Explorer, Spider-Man, SpongeBob SquarePants and other popular characters, according to the filing.

“For years, the defendants sought to enrich themselves by importing and selling dangerous and counterfeit children’s toys without regard for the law or the health of our children,” Brooklyn U.S. Attorney Loretta E. Lynch said in a statement. “We stand committed to protecting the residents of our communities from those who would engage in such conduct.”

The individuals, all residents of Queens, New York, are charged with conspiracy, smuggling, illegal importation and distribution of goods, trafficking in counterfeit goods and criminal copyright infringement. They were arrested yesterday, according to Lynch’s office.

The scheme occurred from about July 2005 to January, according to the indictment. During that time, U.S. customs officials seized toys defendants imported on 33 occasions, according to prosecutors.

Seventeen of those incidents involved toys prohibited under Consumer Product Safety Commission regulations because of lead content, excessive phthalate levels, small parts that present choking hazards or other issues, according to the government.

The case is U.S. v. Hu, 13-cr-68, U.S. District Court, Eastern District of New York (Brooklyn).

Berkshire Unit Sues Hershey Over ‘Chocolate Kiss’ Mark

Berkshire Hathaway Inc.’s Shaw Industries Group sued the Hershey Co. in a trademark dispute.

Dalton, Georgia-based Shaw, a maker of home furnishings and floor coverings, is seeking a court declaration that its “Chocolate Kiss” color name for its carpets doesn’t infringe Hershey trademarks.

According to the complaint filed Feb. 5 in federal court in Rome, Georgia, Shaw has used “Chocolate Kiss” as a color name since 1993. The company is phasing out the name by June 2013, it said in its pleadings.

Shaw said one of its distributors received a cease-and- desist letter from Hershey with reference to “Chocolate Kiss” in December 2012. The home-furnishings company responded in January, arguing that there was no likelihood of confusion between its carpet-color name and the Hershey candy products.

Hershey then sent a second cease-and-desist letter on Jan. 24, Shaw said, demanding that all use of “chocolate kiss” be phased out by Feb. 8.

Shaw filed the suit because it seeks clarification and settlement of the dispute and wants to “continue its regular business without fear of incurring further loss, as well as the uncertainty, insecurity and controversy giving rise to this action.”

It asked the court to declare that its use of “Chocolate Kiss” as a color name doesn’t infringe any of Hershey’s trademark rights or imply any affiliation or connection between the two companies. Additionally, it seeks a court order barring Hershey from interfering with Shaw’s use of “Chocolate Kiss” as a color name and for awards of litigation costs and attorney fees.

Hershey didn’t respond immediately to an e-mailed request for comment.

The case is Shaw Industries Group Inc., v. The Hershey Co., 45:13-cv-00027-HLM, U.S. District Court, Northern District of Georgia (Rome).

For more trademark news, click here.

Copyright

Issa Says Prosecutors to Brief House Panel on Aaron Swartz Case

The Justice Department has agreed to brief a House committee on its decision to prosecute Aaron Swartz, an Internet activist who committed suicide Jan. 11, on computer hacking charges, the panel’s chairman said.

Representative Darrell Issa, chairman of the House Oversight and Government Reform Committee, said yesterday the Justice Department had pledged to give the panel’s members a closed briefing on the case against Swartz.

At the time of his death, Swartz was facing an April trial in Boston federal court on 13 felony charges. He is alleged to have hacked into a Massachusetts Institute of Technology computer and downloaded millions of files from JSTOR, an online library of scientific and scholarly articles, according to a Jan. 28 committee letter to Attorney General Eric Holder requesting the briefing.

The Justice Department hasn’t set a date for the briefing, Issa said in an interview. “I am expecting to get line prosecutors” to brief members because “we want the technical- team details” including comparable penalties in other cases. Issa said he would await the results of the briefing to determine whether a public hearing is needed.

In a letter to Holder, Issa and Maryland Representative Elijah Cummings, the panel’s top Democrat, asked the Justice Department to explain the factors that figured in the decision by the U.S. attorney’s office in Boston to charge Swartz.

The lawmakers also asked whether Swartz’s opposition to the Stop Online Piracy Act “or his association with any advocacy groups among the factors considered” in deciding to bring the case. The legislation was shelved last year after a global online protest led by Google Inc. eroded congressional support.

Swartz, 26, co-founded the news and information site Reddit, as well as Demand Progress, a group that advocated against Internet piracy bills.

Issa said he is considering “possible legislation to divine the difference between the person who steals our Social Security numbers” and “the person who simply finds out they can get information in excess of what they were authorized to in a college system.”

Swartz, Issa said, “appears to fit that last category at least in some part.”

In a statement following Swartz’s death, U.S. Attorney Carmen Ortiz defended the case, saying prosecutors’ “conduct was appropriate in bringing and handling this case.”

Ortiz disclosed that prosecutors had offered to recommend a six-month sentence as part of plea negotiations.

Royalty Dispute Silences Welsh Singers on BBC Cymru Wales

A copyright dispute between the BBC and a breakaway music- collecting society will be heard by the U.K.’s copyright tribunal, the BBC reported.

The BBC Cymru Wales is seeking the hearing in efforts to resolve a royalty-payments issue raised by EOS, a group representing Welsh musicians who broke away from the Performing Rights Society, according to the BBC.

In a statement the BBC Wales said a hearing by the tribunal “would ensure all the arguments are heard and that a fair and transparent decision on commercial rates could be reached.”

Dafydd Roberts, who heads EOS, said that although presently it hasn’t permitted its members’ music to be played on the BBC Welsh-language station, it might reconsider that decision during the process of resolving the dispute, according to the BBC.

For more copyright news, click here.

Trade Secrets/Industrial Espionage

Wyoming Judge to Rule on Fracking Fluid Trade-Secret Designation

A state court judge in Caspar, Wyoming, said she will issue a ruling in 60 days on whether the Wyoming Oil and Gas Conservation Commission too readily granted trade-secret exemptions to disclosure requirements related to a process used in the search for gas and oil, the Caspar Star-Tribune reported.

Judge Catherine Wilking said she will issue the ruling in a case brought by landowners and environmental groups concerned about the effects of hydraulic fracturing on water quality, according to the newspaper.

Steven Leifer, counsel for Halliburton Co. told the court that the company considers some of the fluids used in fracking to be proprietary and confidential, the Star-Tribune reported.

Timothy Preso, an attorney from the environmental legal group EarthJustice, argued that a list of the ingredients in a fracking fluid shouldn’t be confidential because the list isn’t the same thing as a specific formula, according to the newspaper.

IP Moves

Cravath Hires David Kappos, Former U.S. Patent Office Director

Cravath, Swaine & Moore LLP hired David J. Kappos, the former undersecretary of commerce and director of the U.S. Patent and Trademark Office, the New York firm said in a statement.

Before Kappos joined the patent office in 2009, he was the vice president and assistant general counsel for intellectual property at International Business Machines Corp. He joined IBM in 1983, and spent more than 25 years at the company, first as a development engineer and then as a lawyer.

He was appointed to his job at the patent office in 2009 by President Barack Obama. While at the patent office he worked on patent reform legislation that was signed into law in September 2011.

Kappos has an undergraduate degree in electrical and computer engineering from the University of California, Davis, and a law degree from the University of California, Berkeley, School of Law.

To contact the reporter on this story: Victoria Slind-Flor in Oakland, California, at vslindflor@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.

Bloomberg reserves the right to edit or remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.