Intellectual Property and the Rising Popularity of NFTs: The Legal Issues Embedded in Non-Fungible Tokens

Photo Credit: https://www.fiverr.com/sailorshi/create-nft-crypto-art (last visited Nov. 3, 2021).

Authored By: Kristen Strickland

Executive Research & Writing Editor, American Journal of Trial Advocacy

          In the past year, interest in non-fungible tokens (NFTs) has skyrocketed.  One headline-grabbing case involved an NFT of a digital art collage made from 5,000 individual images created by the artist Beeple that sold for $69.3 million in 2021.[1]  Now, other artists, celebrities, and businesses are joining the NFT craze. Continue reading “Intellectual Property and the Rising Popularity of NFTs: The Legal Issues Embedded in Non-Fungible Tokens”

Tips for Handling the Flimsy Witness

Authored By: Michael Flynn

Excerpt

          You are the lawyer representing a party in a big lawsuit!  The stakes are high for both parties in the lawsuit and the facts and the law of the case are both interesting and challenging.  The case promises to be hotly contested.  You have prepared as well as you can with detailed proof charts covering every witness culled from extensive investigation and document analysis.  Now it is time to move forward and execute your plan and see what happens.  A major step in the execution of your litigation plan is taking the deposition of the potentially adverse, even hostile, opposing party and witnesses.  You have put together a deposition plan for each witness that includes learning everything you can from each witness, confirming with the witness what you think you already know, testing the witness to see if you can gain some valuable admissions, and tying down the facts that each witness testifies about.  You are ready!  Then, at the deposition of a key witness, this happens:

            Q:        Who else was present at the final meeting you attended confirming the final design of the table saw?

            A:        I don’t know.

            OR

            Q:        Who else was present at the final meeting you attended confirming the final design of the table saw?

            A:        I don’t remember.

            OR

            Q:        Who else was present at the final meeting you attended confirming the final design of the table saw?

            A:        I think Mr. Patterson, the primary engineer.

            Unfortunately, this happens all too often to lawyers taking depositions.  These kinds of “flimsy answers” demand that the lawyer taking the deposition first listen to the answer and, when the witness and the subject matter of inquiry are critical to the lawsuit, figure out what to do next.

            Attorneys often struggle in depositions and at trial to get needed information from witnesses.  A witness may present these flimsy answers for a multitude of reasons.  A witness’s flimsy answers will become even more problematic when the witness provides such answers as a common response to questions of all kinds or to avoid providing damaging information to the deposing attorney.  There are numerous texts, articles, and continuing legal education publications that provide useful information about how to conduct a competent witness examination both in deposition and at trial.  The purpose of this article is to distill this information and  add  tips  specifically  directed  to  the  witness who provides the flimsy “I don’t know,” “I don’t remember,” or “I think so” answers.

The Compensability of COVID-19 in Workers’ Compensation Cases—A General Analytical Roadmap

Authored By: Stephen D. Palmer

Excerpt

          As of early 2021, more than 29 million people had contracted COVID-19 in the United States and more than 530,000 Americans had died from the virus.  With the spread of COVID-19 in the United States, there is a conceivable crush of workers’ compensation COVID-19 litigation coming.  This Article lays out a basic roadmap that practitioners (on both sides of the aisle) can use in analyzing the compensability of COVID-19 cases in their respective states and is mainly illustrated using the substantive law pulled from the state of Alabama.

Compelling Testimony from the Subject of a Mental Health Proceeding: To What Extent Should Fifth Amendment Considerations Apply?

Authored By: Sean Roman Strockyj

Excerpt

          This Article explores whether a respondent in various mental health proceedings in New York may be compelled to take the witness stand.  The author focuses on applications brought under New York’s Mental Hygiene Law (MHL), including psychiatric commitment cases, guardianship applications, and matters brought under the Sex Offender Management and Treatment Act (SOMTA).  In such litigation it is common for respondents to be represented by the Mental Hygiene Legal Service (MHLS), court appointed government attorneys whose focus is mental health law.  Each of the aforementioned proceedings can result in jury trials, where an application for respondent testimony is most likely to be necessary.  It is a subject that developed an inconsistent body of caselaw and is scarcely addressed in scholarly publications.

Summation Anchoring: Is it Time to Cast Away Inflated Requests for Noneconomic Damages?

Authored By: Mark A. Behrens, Cary Silverman & Christopher E. Appel

Excerpt:

            Plaintiffs’ attorneys are aggressively asking jurors to award ever-higher sums for pain and suffering, and often getting it.  Summation anchoring—requesting an unjustifiably high noneconomic damage award in closing—is highly effective, particularly when sympathetic jurors lack objective means to determine compensation for pain and suffering. Research shows, “the more you ask for, the more you get.”

          The cycle of plaintiffs’ counsel asking for and receiving inflated noneconomic damage awards—that are frequently reduced post-trial and on appeal—is inefficient.  Courts and legislatures should address anchoring tactics by plaintiffs’ counsel that contribute to nuclear verdicts and social inflation.

What’s in a Name? How the Definition of “Automatic Telephone Dialing System” and Ever-Changing Technology Required Supreme Court Intervention

Authored by: Kristen P. Watson & Katherine E. West

Excerpt:

          Since its enactment in 1991, the Telephone Consumer Protection Act (TCPA) has generated voluminous litigation and debate regarding the exact parameters of the TCPA’s regulatory scope.  Among other things, courts and the Federal Communications Commission (FCC) struggled to define precisely what technology constitutes an automatic telephone dialing system (ATDS) within the meaning of the TCPA.  The drastic advancement in technology over the last thirty years has made defining an ATDS much more difficult.  However, the FCC’s attempt to keep pace with changing technology by broadening its definition of an ATDS has given rise to a circuit split on the issue.  In 2021, the Supreme Court weighed in when it decided Facebook, Inc. v. Duguid.  In a unanimous decision, the Supreme Court drastically narrowed the scope of an ATDS, although it remains to be seen how Congress and the plaintiff’s bar will respond.

The Federal Evidence Quasi-Privilege Provisions, Rules 407-10 and 412, Resting on Extrinsic Social Policies: The Propriety of Using Protective Orders to Safeguard Those Policies During the Most Important Litigation Phase, Pretrial Discovery

Author: Edward J. Imwinkelreid

Excerpt:

The Advisory Committee on the Federal Rules of Evidence plausibly argued that although the probative-worth rationale for a quasi-privilege comes into play only at trial, pretrial proceedings can strain or violate the extrinsic social policy serving as the other rationale for the doctrine.  Despite the Committee’s 1994 Note, though, in the intervening years, few commentators and courts have even alluded to the implications of quasi-privileges’ extrinsic policy rationales for pretrial proceedings.  The thesis of this short article is that the Committee’s argument is sound and the argument should be extended to the other quasi-privileges codified in the Federal Rules of Evidence.

            To develop that thesis, this Article proceeds in four steps.  Part I highlights the importance of the issue by demonstrating that pretrial discovery has become the center of gravity in contemporary litigation in the United States.  In both federal and state court, only a small percentage of filed cases culminate in trial.  In most cases, the outcome for the client turns on the developments during pretrial discovery.  Moreover, as a general proposition, under Federal Rules of Civil Procedure a litigant may discover information that would be inadmissible at trial.  For example, under Federal Rule of Civil Procedure 32, at a deposition hearing a party need not object on the ground that the question posed to the deponent calls for inadmissible hearsay, expert opinion, or secondary evidence.  Indeed, an attorney could be sanctioned for instructing a deponent to refuse to answer based on one of those evidentiary doctrines. 

            Part II of the Article describes the quasi-privilege provisions in the Federal Rules and identifies both rationales for each doctrine.  Part III is also descriptive and reviews the courts’ decidedly mixed record on recognizing the procedural ramifications of the quasi-privileges’ substantive extrinsic policy rationales.  On occasion a few courts have perceived and respected those implications; but in most instances, the courts ordinarily have either been oblivious to those implications, or dismissed the implications even when litigants were astute enough to point them out to the court.

            Finally, Part IV shifts from description to critical evaluation.  Initially, Part IV addresses the question of whether the Federal Rule’s quasi-privilege provisions dictate that the courts consider the extrinsic policies underlying the provisions during pretrial discovery.  Part IV.A. concludes that that question should be answered in the negative.  However, Part IV.B. then turns to an analysis of the applicability of the protective order provision in Federal Rule of Civil Procedure 26—the provision that the Advisory Committee mentioned in its Note accompanying the 1994 amendment to Rule 412.  Part IV concludes that, given the right facts—case-specific facts demonstrating that public disclosure during pretrial discovery would impinge on the extrinsic policy inspiring a quasi-privilege in the instant lawsuit—Federal Rule of Civil Procedure 26 empowers the courts to vindicate that policy by issuing a protective order.

Actual Consumer Confusion Leads To Trademark Infringement Suit, Has Little Relevance In The Court’s Decision In The End: SCAD v. Sportswear

Photo Credit: https://lakeridgenewsonline.com/opinion/entertain/2018/03/28/online-shopping-vs-in-store-shopping/#modal-photo (last visited September 9, 2021).

Written By: Forrest Hyde

Executive Editor, American Journal of Trial Advocacy

          With the recent surge in online shopping due to health and safety concerns linked to COVID, there has never been a better time to find what you want to buy through an online retailer.  It’s also never been easier to customize what you buy.  Whether ordering for your own personal use, promotion of your business, or for an organization that is raising funds, numerous websites provide services that allow for anyone to have almost anything printed on merchandise at the click of a button.  But what happens when an online service crosses the line, printing a trademarked logo or name on merchandise without permission, likely confusing customers about where the product came from?  The Eleventh Circuit’s recent decision in Savannah College of Art and Design v. Sportswear, Inc. shed light on the subject, where an online company had been selling merchandise bearing the school’s trademarked logo and name without permission for years. [1]

I: Background of the Case

          Savannah College of Art and Design, Inc. (“SCAD) is a private college based in Georgia known for their specialized art programs.[2]  SCAD has used two word marks—“SCAD” and “SAVANNAH COLLEGE OF ART AND DESIGN”— since 1979, and a design mark depicting SCAD’s mascot, “Art the Bee,” since 2001.[3]  Sportswear, Inc. (“Sportswear”) operates an online business that has sold made-to-order apparel and other items to schools, sports teams, and other organizations since 2003.[4]  Without permission, Sportswear sold merchandise bearing SCAD’s marks for a period of five years before SCAD found out about these sales from a parent of one of their student-athletes.[5]  SCAD promptly filed a trademark infringement suit against Sportswear, who thereafter stopped selling all merchandise bearing SCAD’s marks in its online store.[6]

          SCAD needed to establish two things in order to prevail in its trademark infringement case: (A) “enforceable trademark rights in its marks used by Sportswear”, and (B) “that Sportswear’s unauthorized use of its marks was likely to confuse consumers.”[7]  Initially, the district court granted summary judgment in favor of Sportswear on both requirements, but the Eleventh Circuit reversed on requirement (A) and remanded the case to determine requirement (B), which ultimately resulted in the district court entering permanent injunctive relief for SCAD against Sportswear.[8]  The Court of Appeals for the Eleventh Circuit, as explained below, affirmed SCAD’s victory.[9]

II: The “Likelihood of Confusion” Factors

          The bulk of the Eleventh Circuit’s decision centered around the “likelihood of confusion” analysis in order to determine if the lower court had applied the many factors correctly.  The court here placed its focus on likely consumer confusion—allegedly created by Sportswear’s use of SCAD’s word marks—as to “origin, source, approval, affiliation, association, or sponsorship.”[10]  The Eleventh Circuit considers seven factors in this analysis:

(1) Strength of the mark alleged to have been infringed; (2) similarity of the infringed and infringing marks; (3) similarity between the goods and services offered under the two marks; (4) similarity of the actual sales methods used by the holders of the marks, such as their sales outlets and customer base; (5) similarity of advertising methods; (6) intent of the alleged infringer to misappropriate the proprietor’s good will; and (7) the existence and extent of actual confusion in the consuming public.[11]

          The court added that not every factor need be considered in every case, but that “[(1)] the type of mark and [(7)] the evidence of actual confusion are the most important” of all the factors.[12]  Conversely, the court noted that the factors of “[(3)]similarity of product, [(4)] identity of retail outlets and purchasers, and [(5)] identity of advertising media utilized” are less relevant in cases—such as this one—where the concern for confusion arises from “the defendant’s misuse of the plaintiff’s reputation and good will as embodied in the plaintiff’s mark.”[13]  Thus, before their analysis had even started, the court indicated that nearly half of the factors make little difference.

III: The “Likelihood of Confusion” Analysis

            Beginning the likelihood of confusion analysis, the court first focused on the strength of SCAD’s word marks, which the court held to be incontestable, even though “incontestable status” does not lead to a presumption that the mark is a strong one.[14]  Nevertheless, the court held SCAD’s word marks to had acquired significant strength through their decades of use “through [their] investment and goodwill,” despite Sportswear’s arguments that a few other third-parties had diminished the strength of SCAD’s marks through their uses.[15]  The court then made quick work of the second factor, noting that Sportswear used identical marks to SCAD’s word marks on its apparel; this easily weighed in SCAD’s favor.[16]

            The next three factors, the court noted throughout, hold lesser weight in cases like this one, “where the defendant seeks to trade off the plaintiff’s goodwill and reputation, as opposed to its products.”[17]  The third factor—similarity of goods or services—normally assess “whether the goods are so related in the minds of consumers that they get the sense that a single producer is likely to put out both goods.”[18]  However, this factor was held to bear little significance because SCAD’s marks embody their goodwill and reputation.[19]  The fourth factor—similarity of actual sales methods—considers the similarity of the parties’ customer bases, which overlapped in this case.[20]  This weighed in SCAD’s favor, albeit not by very much given the factor’s diminished significance.[21]  Then, the court held that the fifth factor—similarity of advertising methods—was neutral as to both SCAD and Sportswear, who both advertised over the internet.[22]

            The sixth factor considered “Sportswear’s intent to misappropriate SCAD’s goodwill,” which might be proved by circumstantial evidence.[23]  Here, SCAD had to present evidence that Sportswear not only copied intentionally, but also copied with the intent to confuse customers.[24]  The court noted that “[t]he very nature of sports memorabilia relies upon the goodwill, reputation, and affiliation people associate with that school,” and that Sportswear could not “reasonably argue against a finding of intent here.”[25]  Sportswear argued that their website’s disclaimers, that their store was “not sponsored or endorsed” by SCAD, negated intent, but the court held that this was insufficient “to totally negate confusion” that Sportswear intentionally created in order to profit off of SCAD’s goodwill and reputation.[26]

            Finally, the court focused on the “actual-confusion factor,” which “weighs heavily in the balance” but is a “demonstrably different concept[]” from likelihood of confusion.[27]  SCAD happened to have one piece of evidence to show actual confusion—one parent’s notification regarding Sportswear’s website—which was “hardly strong evidence of actual confusion.”[28]  This was the only factor that weighed in favor of Sportswear, but the court concluded yet again that the significance of a factor may diminish in cases such as this one, explaining that “with a smaller market and inexpensive goods… [the court] has cautioned that weak evidence of actual consumer confusion is not dispositive.”[29]  The court explained that “the likelihood-of-confusion analysis must be mindful that ‘casual purchasers of small items’ are more likely to be confused than more sophisticated consumers of complex goods.”[30]

          Thus, when taken together with the other diminished factors, the court weakened the significance of more than half of the factors leading up to a holding that favored SCAD.  At the outset, the court noted that “actual confusion” would be a very important factor, but waited until later in its decision to dilute this factor, even though SCAD showed evidence in their favor that a customer was actually confused about the source of the goods they found online.  Odd result, but would it have made a difference in the court’s ultimate conclusion in a case such as this?  Likely not.

IV: Conclusion and Outlook

          After balancing all of the factors and noting which factors have diminished significance due to the nature of the case, the court concluded that Sportswear’s use of SCAD’s word marks posed a likelihood of confusion,[31] as did Sportswear’s used of SCAD’s design mark, “Art the Bee.”[32]  Accordingly, the Eleventh Circuit Court of Appeals affirmed the district court’s grant of “summary judgment and the corresponding permanent injunction in favor of SCAD.”[33]

          Thus, in similar online markets for inexpensive goods, “likelihood” may outweigh “actual” confusion.  Here, actual confusion, in the form of one parent’s notification, made no difference in the court’s conclusion as to the broader “likelihood” that Sportswear’s use would confuse other consumers seeking SCAD merchandise simply because the goods were cheap and the market small.  This could possibly lead to a conclusion that casual online shoppers—of which there are millions—perhaps looking for cheap merchandise from their alma mater, may end up ordering from an infringing seller, up until the point that a concerned parent speaks up, that is.  Remember, there may not have been a trademark infringement suit here to begin with, had that one parent not notified SCAD of their actual confusion.[34]  Online shopping is an enormous area of business, with millions of miniscule “markets” for every product imaginable.  Perhaps the Supreme Court will weigh-in on this holding in order to establish that actual confusion in these many markets carries more weight, only time will tell.[35]


[1] 983 F.3d 1273, 1277 (11th Cir. 2020).

[2] Savannah Coll., 983 F.3d at 1277.

[3] Id. at 1278.

[4] Id.

[5] Id.

[6] Savannah Coll., 983 F.3d at 1278 (explaining that SCAD sued Sportswear under the Lanham Act also for “unfair competition and false designation of origin, and counterfeiting, and under Georgia common law for unfair competition and trademark infringement”).

[7] Id. at 1279.

[8] Id. at 1279-80.

[9] Id. at 1280.

[10] Savannah Coll., 983 F.3d at 1280.

[11] Id. at 1280-81 (quoting Sovereign Military Hospitaller Order of Saint John of Jerusalem of Rhodes & of Malta v. Fla. Priory of the Knights Hospitallers of the Sovereign Order of Saint John of Jerusalem, Knights of Malta, The Ecumenical Order, 809 F.3d 1171, 1181 (11th Cir. 2015)).

[12] Savannah Coll., 983 F.3d at 1281 (quoting Fla. Int’l Univ. Bd. of Trs. v. Fla. Nat’l Univ., Inc., 830 F.3d 1242, 1255 (11th Cir. 2016)).

[13] Savannah Coll., 983 F.3d at 1281 (citing Univ. of Ga. Athletic Ass’n v. Laite, 756 F.2d 1535, 1547 (11th Cir. 1985)).

[14] Savannah Coll., 983 F.3d at 1281-82; see also Dieter v. B&H Indus. of Sw. Fla., Inc., 880 F.2d 322, 328 (11th Cir. 1989) (explaining that a descriptive mark becomes “incontestable” if the holder of the descriptive mark proves that the mark has acquired “secondary meaning”— the mark has become distinctive of the trademark holder’s product—and that the mark has been in use for five years after registering the mark).

[15] Savannah Coll., 983 F.3d at 1282-83; see also 87 C.J.S. Trademarks, Etc. § 126 (2021) (“Generally, the stronger the mark, the greater the likelihood that consumers will be confused by competing uses of the mark.”).

[16] Savannah Coll., 983 F.3d at 1283.

[17] Id. at 1284 (emphasis added).

[18] Id. at 1283.

[19] Savannah Coll., 983 F.3d at 1284.

[20] Id.

[21] Id.

[22] Id.

[23] Savannah Coll., 983 F.3d at 1284.

[24] Id. at 1285 (citing Yellowfin Yachts, Inc. v. Barker Boatworks, LLC, 898 F.3d 1279, 1293-94 (11th Cir. 2018)); see also Sovereign Military Hospitaller Order, 809 F.3d at 1188 (“When intent is present, it can ‘justify the inference that there is a confusing similarity.’. . . But ‘it is neither a necessary nor sufficient condition for determining the ultimate legal fact of the “likelihood of confusion.”’”) .

[25] Savannah Coll., 983 F.3d at 1285.

[26] Id. at 1285-86.

[27] Savannah Coll., 983 F.3d at 1286; see also Stacy L. Davis et al., Fed. Proc., Law. Ed. § 74:534 (2021) (“Although proof of actual confusion is no necessary to show a likelihood of confusion on a claim of trademark infringement, the absence of any evidence of actual confusion over a substantial period of time creates a strong inference that there is no likelihood of confusion.”).

[28] Savannah Coll., 983 F.3d at 1286.

[29] Id.

[30] Id. at 1287 (quoting Fla. Int’l Univ., 830 F.3d at 1256).

[31] Savannah Coll., 983 F.3d at 1287.

[32] Id. at 1287-88.

[33] Id. at 1288.

[34] Id. at 1277.

[35] See Sportswear Maker Asks High Court To Take College’s TM Row, Law360, https://www.law360.com/articles/1372585/sportswear-maker-asks-high-court-to-take-college-s-tm-row (April 6, 2021, 6:52 PM EDT) (noting that Sportswear has petitioned for a writ of certiorari with the United States Supreme Court in this case).

SB 202 or Jim Crow 2.0: How Georgia’s New Voting Law Changes Its Election System and Why It’s Being Challenged as Unconstitutional

Photo Credit: https://decaturish.com/2021/03/photos-voters-protest-senate-bill-202-georgias-new-voter-suppression-law/ (last visited August 19, 2021).

Written By: Lorel Stano

Student Materials Editor, American Journal of Trial Advocacy


          On the evening of March 25th, Georgia Governor Brian Kemp signed Senate Bill 202 into law just an hour after it cleared the General Assembly, with the asserted purpose of “ensur[ing] elections in Georgia are secure, fair, and accessible.” Continue reading “SB 202 or Jim Crow 2.0: How Georgia’s New Voting Law Changes Its Election System and Why It’s Being Challenged as Unconstitutional”

Has the Alabama Senate Missed the Jackpot?

Photo Credit:
https://www.al.com/news/2019/04/lottery-in-alabama-will-it-finally-happen-heres-what-you-need-to-know.html (last visited July 22, 2021). 

Written By: Savannah Nixon 

Managing Editor, American Journal of Trial Advocacy 

            At the beginning of March, Republican Senator Del Marsh proposed a constitutional amendment to allow lottery and casinos in the state of Alabama.[1]  However, the proposal fell short by only two votes, gaining 19 out of the required 21 to get the proposed constitutional amendment through the Senate. [2]  19 senators voted in favor of the bill, while 13, all Republicans, opposed the proposal. [3]  The proposal was an attempt to get the issue of gambling in front of Alabama voters for the first time since 1999.[4]  But the questions remain, why did the legislature reject the amendment, and what does this mean for the state of Alabama? Continue reading “Has the Alabama Senate Missed the Jackpot?”