Starbucks is suing Conga Coffee and Tea, a tiny two-store operation in Michigan, for trademark infringement link here. Both use green circles around a small center picture, so there is a vague resemblance. But this is a case of an elephant trying to stamp on a mouse. Incidentally, Conga has been in business with the same trademark since 1996, and went unnoticed until now.

We rarely get the chance to make the case for protecting any form of intellectual property. Here is one from Mike Masnick at Techdirt. The Korean cell phone maker, LG, is peddling a phone called Black Cherry very close to RIM's BlackBerry link here. If people are as mindless about shopping for named goods as I, they could easily confuse them. That is the bottom-line case for trademarking--it's protection for the buyer.

T-Mobile claims to own the color magenta, ostensibly having put it under trademark. The law on this is complicated beyond belief, which allows an otherwise ridiculous determination to continue to be enforced. Read all about it here and here.

Who is going to sue at great expense to get it overturned?

We don't often write about trademarks, but here is a case of some modest interest. An online video joint-venture fiddled around for some time and finally came up with the name, Hulu link here and here. It is a strange choice, as it conveys nothing to me. Then an online custom book publishing company called Lulu sued for trademark infringement because the name was too similar. Does that strike you as confusing? Still, strange things happen with IP. One conjecture is the companies will pursue the case for all the media attention it draws. In any case, another lawyers' delight.

Matt Yglesias pokes into another small absurdity in IP, reporting that defense contractors hold copyrights on weapons designs used by toy replica makers and collects fees for their use link here. Now Congress is going to get involved as one Congressman proposes that design copyrights be owned by the government which paid for the weapon designs and receive the toy makers' fees. For me, there is a bit of confusion here in whether it is a copyright, a trademark, or a design patent that is owned. But there seems to be no doubt that a license is available for a fee and it ought to be the taxpayer who benefits.

South Korea has announced that it has created "a private fund as a weapon to protect Korean intellectual property rights overseas" link here. It will "profit from filing suits against foreign companies accused of infringing Korean trademarks and patents." The fund has partnered with a research institute created by the Ministry of Science and Technology, to act as its proxy in overseas patent suits. The Ministry will receive half of any royalties and private investors, the balance. Currently the research institute has wireless technology patents that it thinks are being infringed overseas by cell phone makers Motorola, Sanyo, Nokia, Sony Ericsson, and Siemens; by wireless service providers Verizon, Sprint, and Cingular and by chip makers Qualcomm and Freescale Semiconductor.

The news article suggests that this is a way to fight back against US patent trolls. It particularly refers to Inter Digital, a U.S. company, which filed a lawsuit of more than US$300 million against Samsung Electronics and LG Electronics for allegedly violating patent rights.

Comment: This may be a response to the Free Trade Agreement recently negotiated with the US which extends IPR to Korea as well as the aggressive behavior of US patent trolls. Consider this the creation of a "national" troll--it creates a troll to beat one.

The Washington Post's Alan Sipress writes about a new development in valuing intellectual property link here. The notion is that the total market value of a company less the value of its tangible assets reflects the value of its patents, copyrights, trademarks, and trade secrets.

This formulation was arrived at from calculations showing that the market value of companies increasingly reflects their intangible assets. Using the market value of the S&P 500 Index and the accounting value of their tangible assets, an investment research firm called Ocean Tomo estimated that intangibles have gone from 17 percent of total market value in 1975 to 80 percent in 2005. Behind this is the notion that the value of tangibles has gone down through offshoring of goods and services. The article also notes that a stock index based on intellectual capital called the Claymore/Ocean Tomo Patent ETF is traded on the American Stock Exchange.

Comment: Nothing is said about the overall level of the stock market in determining intellectual property values. I suppose it would be possible to factor that in. In any case, the new notion is that the heart of our economy is intellectual capital. This economist would like to see some attempt to estimate total factor productivity in the market value of companies to reflect their differential ability to add value.

Is the patent system broken? You be the judge. Here is a case of several examples of prior art that were not caught by the Patent and Trademark Office and are now giving rise to a patent suit by Verizon against Vonage, closing it down for a period and threatening it over the long run link here. Even with the evidence, Verizon's patent will need to be declared invalid, a procedure that may take a long time and cost Vonage money it doesn't have and business it is now unlikely to get.

David posted about the draft Patent Reform Act, just introduced in the Congress, as I was about to. Another source is link here with its own comments. I quote: "The provisions of the Patent Reform Act would... restrict damages that patent holders can receive for infringement lawsuits, create a new procedure to challenge the validity of a patent after it has been granted, and boost resources for the US Patent and Trademark Office."

"The corporate roster of backers includes Microsoft, IBM, Amazon, and nearly everyone else. Similar legislation failed to pass during the last session of Congress. Other groups, including the pharmaceutical industry and small inventors, have opposed major changes to the patent system."

The special interests gather at the trough. If we have to have patents, this may be a modest improvement. But don't count on it. More important, watch what gets attached to the bill as it wends it leisurely way through the legislative process and the tasty tidbits are on offer.

I missed this when it first came out. The US Patent and Trademark Office reports it has issued its first patent under an accelerated procedure link here. The Office writes that the first patent under its accelerated examination program that began in August 2006, for a printer ink gauge, was filed with the USPTO on September 29, 2006, and was awarded to Brother International, Ltd. on March 13, 2007. Average review time for applications in the ink cartridge technology area is 25.4 months. This patent issued in 6 months, a time savings of 18 months for the patent holder.

To be eligible for accelerated examination, applicants are required to provide specific information, known as an examiner support document, so the USPTO can issue a final decision by the examiner within 12 months on whether their application for a patent will be granted.

Inventions that are new, useful, non-obvious, and accompanied by a written description disclosing how to make and use it, are presumed to be patentable. To reject an application, the USPTO must show that the invention is obvious or not new ("prior art").

Normally, applicants have to disclose to the USPTO relevant prior art of which they are aware but are not required to search for it. For accelerated examination, they must search for prior art, submit all prior art that is closest to their invention, and explain what the prior art teaches and how their invention is different.

They must state how their invention is useful and show how the written description supports the claimed invention. Only a limited number of claims is allowed in each application and the time for responding to most USPTO communications is shortened.

This and the peer review process (recently described here) presumably will improve the quality of patents issued. However, there is a good bit of skepticism among those of us at Against Monopoly who see the USPTO as overwhelmed and under the strong influence of existing patent holders and big business.

Keep an eye peeled.