“Palcohol” Facing Buzzkill from State Legislatures

We’ve got good news and bad news for those of you who are sick and tired of toting around a flask. The good news first: powdered alcohol has won approval from federal regulators and is very close to hitting the market. Basically, it’s freeze-dried or dehydrated alcohol that can either be consumed by itself or mixed with water to produce a drink. The product is being marketed by one company as “Palcohol.” The bad news? More than 20 states have already acted to ban it, either temporarily or outright. On Friday, New York became the latest.

In March, Palcohol received the green light from the Alcohol and Tobacco Tax and Trade Bureau. This was the last regulatory step on the federal level before the product could be sold in stores. However, the states can also regulate alcohol sales in their borders. Many have done exactly that.

Based on purported concerns about safety and underage drinking, many states have already banned the product. New York Governor Andrew Cuomo claims that powdered alcohol can easily lead to dangerous levels of intoxication if it is ingested in its powdered form or mixed incorrectly. Cuomo said in statement:

This dangerous product is a public health disaster waiting to happen. I am proud to sign this legislation that will keep powdered alcohol off the shelves and out of the wrong hands.

Palcohol is working hard to reverse these bans and claims that the so-called safety concerns are a false pretense.  On its website, Placohol states “this isn’t about powdered alcohol being a public safety threat. It’s about the liquor companies protecting their market share and profits.” Mark Philips, Palcohol’s creator, claims, “Palcohol is not some super concentrated version of alcohol. It’s simply one shot of alcohol in powdered form.”

We’ll be keeping an eye on this issue for you.

No Monkey Business . . . Court Rules Chimps Don’t Have Human Rights

A New York Judge recently heard a case brought by an activist claiming that chimpanzees should be afforded the same legal rights as humans. Although Judge Barbara Jaffe ruled that they don’t possess any such rights, the opinion was a strange one, and it seems that she was initially inclined to grant them such rights but felt constrained by some pesky legal precedent to the contrary.

The case involved two research chimpanzees named Hercules and Leo. Lawyers for the Nonhuman Rights Project alleged that the chimps were entitled to rights that the legal system has previously recognized as applying only to humans. The lawyers asked for a writ of habeas corpus authorizing the transfer of the animals from captivity at a state university to an animal sanctuary in Florida. They argued that “because chimpanzees possess fundamental attributes of personhood in that they are demonstrably autonomous, self-aware, and self-determining and otherwise are very much like humans, ‘justice demands’ that they be granted fundamental rights of liberty and equality afforded to humans.”

Such a grant of rights would have marked a first for a court in the United States. Ultimately, the judge concluded that she was bound by an earlier ruling by a New York appellate court that held that chimps are not entitled to legal person status because of their inability to take on duties or responsibilities. However, Judge Jaffe suggested that the legal system was evolving on the issue just as it did in the debate over gay marriage.  In so doing, she cited a handful of cases granting narrowly expanded rights to animals and stated that this was ultimately question of public policy.

Slingbox Sued For Slinging Ads To Customers

If there’s anything this particular author hates, it’s advertisements. They are everywhere these days . . . from Taxi Cabs to Subway Turnstiles, you just can’t escape them. It’s gotten so crazy that we’ve even seen a local DUI defense law firm place ads on an “over 21″ wrist band needed to buy beer at a minor league hockey game. As annoying as the ads may be, it’s just part of modern life. Or is it? Some customers of Slingbox who have been bombarded with new adds aren’t taking it lying down and have filed a class action lawsuit against the Sling Media. If you don’t recall, Sling Media is the maker of the Slingbox, which takes customers’ home TV signal that comes from a cable box and “slings” it to a phone, tablet, or computer anywhere in the world. In a nutshell, it’s like being able to take your home TV and remote with you anywhere in the world. Slingbox is a slick device, but it comes with a hefty price tag north of $200.

According to the lawsuit, in March of this year, Slingbox devices started embedding advertising in media streamed to their mobile devices. So, now, Slingbox customers are forced to watch the embedded ads from Slingbox in addition to whatever ads are being shown through their cable provider. The plaintiffs allege that they never consented to this additional advertising. They claim that Sling Media failed to disclose that the use of the product would be contingent upon and subject to this advertising. According to the complaint, “Slingbox has perpetuated a massive ‘bait and switch’ upon thousands of unsuspecting consumers, each of whom spent as much as $300 or more for these products, but who now need to watch the defendant’s ads to use their devices as promised.”

Of course, the plaintiffs are seeking class action certification in California district court. They have alleged that the ads are misleading and violate business California consumer protection laws and constitute unfair competition or deceptive business practices. As you might expect, the Plaintiffs are not just seeking an injunction to stop the ads. They also seek restitution and disgorgement of all profits garnered from the allegedly unfair or misleading business practices. We’ll keep an eye on this one.

Amazon Faces Trademark Lawsuit Over Search Results

Protecting customers who are somehow able to shop online but are unable to read. That seems to be the goal of a recent Ninth Circuit ruling in a trademark case filed against Amazon.  In a case between MTM and Amazon, the court ruled that Amazon is misleading consumers by providing search results that don’t explicitly state that the product you searched for is not carried. It’s like if I visited a sporting goods store and asked a clerk to see the Nike tennis shirts. If the store didn’t carry Nike shirts and the clerk simply pointed you to the tennis goods section, would the clerk’s actions reasonably mislead me into believing that every shirt in the tennis section is a Nike shirt?  Of course not.

The Amazon trademark case is essentially the scenario described above. Amazon doesn’t carry MTM watches. Customers that search for “MTM Special Ops” on Amazon.com are simply provided with a list of watches from from other brands. While the search results do not explicitly state that Amazon does not carry MTM watches, the search results do clearly state the brand names of the watches being sold.   Nevertheless, MTM argued that Amazon’s search results constituted trademark infringement.

Initially, a district court granted summary judgment to Amazon, holding that Amazon’s actions did not create a likelihood of confusion for customers. However, the Ninth Circuit Court of Appeals reversed and ordered the case to proceed to trial. The reversal is based up a trademark doctrine called “initial interest confusion.” The court’s opinion, summarized the doctrine as:

Initial interest confusion occurs not where a customer is confused about the source of a product at the time of purchase, but earlier in the shopping process, if “customer confusion… creates initial interest in a competitor’s product.” Even if that confusion is dispelled before an actual sale occurs, initial interest confusion still constitutes trademark infringement because it “impermissibly capitalizes on the goodwill associated with a mark and is therefore actionable trademark infringement.”

This whole doctrine is silly. This issue could cover a whole range of traditional sales methods, including product placement. Is a store not allowed to put Nike and Adidas shirts on the same rack? What about placing generic items on the shelves next to brand names?

The dissenting judge pointed out how curious the majority’s ruling is with respect to Amazon:

Because Amazon’s search results page clearly labels the name and manufacturer of each product offered for sale and even includes photographs of the items, no reasonably prudent consumer accustomed to shopping online would likely be confused as to the source of the products….The search results page makes clear to anyone who can read English that Amazon only carries the brands of watches that are clearly and explicitly listed on the web page. The search results page is unambiguous.

We’ll just have to wait see what a jury has to say about this whole thing.  We suspect a reasonable jury would tell MTM to take a hike.

Standby for Lawsuits: Handheld Flamethrower Hits Open Market…

Coming soon to a courtroom near you . . . handheld flamethrowers. With an Internet connection and just $899, you can arm yourself with your very own handheld flamethrower. A Michigan company has launched the XM42 Flamethrower, which it bills as “the world’s first commercially available handheld flamethrower.” This future darling of products liability plaintiffs’ attorneys was made possible by crowdfunding (a.k.a. other idiots on the Internet). The manufacturer raised more than $150,000 in one month to fund the production.

According to the company, “as of now, flamethrowers are a fun toy for responsible adults and are useful for practical purposes.” The practical purposes? The company claims that flamethrowers are handy for insect control, weed removal, and other reasons, too. So the product is a snow shovel, fly swatter, and bottle of round-up all in one fun package.

We could say whole bunch of things about this product, but watching this baby in action is only way to do it justice. Click here to see it in action.

Old Songs, New Money – SiriusXM Settles Copyright Lawsuit

Sirius XM has resolved a piece of major litigation in its fight over its right to play pre-1972 recordings. In so doing, Sirius XM has settled with independent and major record companies for the satellite radio company’s alleged broadcasting of songs made before 1972 without permission and without paying royalties. The satellite radio broadcaster will pay $210 million to plaintiffs ABKCO Music & Records, Capitol Records, Sony Music Entertainment, UMG Recordings, and Warner Music Group.

The dispute centers around the rights of artists and record labels to control the use of recordings made before 1972. What’s with 1972? Federal copyright law only protects sound recordings made after February 1972. Thus, rights and compensation for pre-1972 recordings is determined by certain state laws. Until recently, SiriusXM and many other radio stations paid nothing for the broadcast of these recordings.

The settlement provides a nationwide resolution for Sirius XM’s use of the plaintiffs’ pre-1972 recordings. Under the settlement agreement, SiriusXM will have license the covered songs through the end of 2017. After that, Sirius XM must negotiate with the record labels for use of the songs going forward.

The matter of pre-1972 copyright issues is not, however, completely resolved for SiriusXM.  It still faces an outstanding copyright lawsuit brought last year by the founders of the ‘60’s band, The Turtles.

Attorney: Hand Over The Name CaseRails And Nobody Gets Hurt!

We here at Abnormal Use have a question for you. Any chance that you would come across a company named CaseRails and inadvertently think you had found a company named CaseWebs or CaseSpace? Neither did we. However, one misguided lawyer who owns trademarks for the latter entities thinks you might. He recently sent a cease and desist letter to CaseRails demanding that they fork over their company name and Internet domain name.

CaseRails is a small startup that offers a document management system designed to automate the process for drafting, storing, and reusing legal documents.  Sanford Asman, a trademark lawyer, claims that the name CaseRails infringes on his trademarks for the terms “CaseWebs” and “CaseSpace.” CaseWebs is purportedly a litigation support software owned by Asman.  It’s not clear that the name CaseSpace is being actively used Asman.

Apparently, Asman believes he’s got a corner on the market for any legal software names starting with the generic word “case.” His cease and desist letter can be read here. In the letter, he claims: “I take very seriously any third party attempts to use ‘Case’ formative marks in connection with web-based legal applications.” Maybe he should give LegalZoom a call and offer to help them pursue all those companies using names starting with generic word “legal.”

Luckily for the guys at CaseRails, Asman is generously willing to work out a resolution if they’d be so kind as to hand over the rights to the name CaseRails and the domain name CaseRails.com. We can understand that the guys at CaseRails might not want to spend valuable resources in a battle over their name. However, that is almost certainly what Asman is banking on.  We hope they do fight the matter as this thing is just down right silly.

JC Penney “Phantom” Pricing Lawsuit

Get this: There is definitely a real class action lawsuit against JC Penney in federal court in California over purported “phantom discounts.”

The lawsuit accuses JC Penney of hiking retail prices on apparel and accessories to trick shoppers into believing they were receiving sizable discounts when the items were advertised as being on sale.  The long and short of it is that the when retailer would run a sale, they would allegedly markup the price of the item and then “discount” it back down to the same price it had been at for months. For example, the complaint alleges that for a sale they’d mark up a shirt that had been selling for $17.99 to $30 and then they’d sell it for 40 percent off . . . or $17.99. The class action lawsuit has been certified by the federal judge presiding over the case.

To be fair, JC Penney apparently tried to move to everyday low pricing in 2012.  Ironically,  executives billed the new pricing model as the end of “fake pricing.” Apparently the customers really wanted fake pricing because the everyday low pricing was a miserable failure and they quickly went back to a more traditional discounting model.  It does make you wonder, however, if any of these claims of phantom discounting claims occurred during the period that the retailer was switching between business models.

The Federal Trade Commission does actually have regulations governing this sort of thing.  16 C.F.R. 233.1 requires retailers to sell items at original prices for a “reasonable length of time” before discounting them.  Sort of makes you wonder how Jos. A. Bank continues its thing, but that’s a story for another day.

Environmental Groups Sue to STOP Solar Panel Farm at NJ Amusement Park

Six Flags Great Adventure, a New Jersey amusement park, wants to create a huge solar farm that will generate enough electricity to make the park energy independent.  A big business that is trying to operate on an entirely renewable energy source – that sounds like something environmentalist would be applauding, right?  Not so fast.  Several environmental groups recently filed a lawsuit to stop the project because it calls for the removal of trees on the site.

The lawsuit filed against the amusement park and the solar energy company, KDC Solar, is seeking an injunction to halt the project, which they claim will result in the clearing of 90 acres of environmentally sensitive forest land.  They argue that the solar farm project violates local ordinances for tree removal.  They further claim that the local planning board failed to follow required procedures for approving the project, including not studying alternatives to deforestation.

However, the environmental groups don’t want the project halted altogether.  They want Great Adventure to build the solar farm above its parking lot. Although Great Adventure has not commented on the lawsuit, it has previously issued public statements regarding the proposal to build the solar farm above its parking lot.  It apparently ruled out the idea because of concerns over customer safety and decreased parking area.  Increased costs of 20 to 50 percent also may have been a factor in the decision.

It should be interesting to see where this goes.  It will likely come down to whether the planning board took the right procedural actions and, if not, whether they want to cure the procedural deficiencies in order to allow the project to move forward.

Can’t Buy Me Love? Amazon Sues to Block Purchased 5 Star Reviews

As we reported on Monday, Amazon.com is apparently none too happy with a person or persons that runs handful of websites with names like “buyamazonreviews.com” that offer to give glowing reviews of sellers’  products on Amazon for a price.  We have a few more thoughts on this matter. On April 8th, Amazon filed a lawsuit against the websites’ owner or owners  in Washington state court. Amazon calls the of buying and selling of reviews an “unhealthy ecosystem” that is damaging its brand.

The complaint filed in King County Superior Court names an individual named Jay Gentile as the operator of buyazonreviews.com.  Amazon also asserted claims against a John Doe defendant since it does not know who is operating buyamazonreviews.com, bayreviews.net and buyreviewsnow.com. Amazon wants the court to shut the websites down for trademark infringement, unfair competition and violation of the Consumer Protection Act.  The complaint also seeks an injunction to stoping  the selling fake reviews and an order requiring the sites to identify each Amazon review created in exchange for payment.

Amazon expressly prohibits paid reviews and threatens to suspend sellers that buy fake reviews. According to the complaint:

[the] Defendants are misleading Amazon’s customers and tarnishing Amazon’s brand for their own profit and the profit of a handful of dishonest sellers and manufacturers…Amazon is bringing this action to protect its customers from this misconduct, by stopping Defendants and disrupting the marketplace in which they participate.”

Although there’s no way of knowing which products have reviews that may have been purchased form one of these website.  However, this review seems to be a very likely candidate as it appears to have been written by J. Peterman.