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Media Alerts - Stephen Slesinger, Inc. v. Disney Enterprises, Inc. - Federal Circuit
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January 7, 2013
  Stephen Slesinger, Inc. v. Disney Enterprises, Inc. - Federal Circuit
Headline: Winnie-the-Pooh at the Center of Ongoing Litigation

Area of Law: Trademarks and copyrights

Issue(s) Presented: Whether the Patent and Trademark Office properly dismissed challenges to Disney trademarks for Pooh and friends.

Brief Summary: The Federal Circuit agrees that the PTO was correct to reject arguments that had already been resolved by a federal district court in California.

Significance: This case resolves the latest, but perhaps not last, heated dispute concerning rights to Winnie-the-Pooh. The upshot is that, following the expiration of Pooh copyrights in 2023, Disney will need to share related income with no one.

Extended Summary:

In the 1920s, A.A. Milne wrote four books about Winnie-the-Pooh and other anthropomorphic creatures as playmates for a fictionalized version of his son, Christopher Robin. In the 1930s, Milne transferred some U.S. and Canadian rights in his works to Stephen Slesinger. Milne then set up a trust and Slesigner set up SSI, a corporation. In 1961, SSI agreed to convey its rights to Disney in return for royalties.

The 1976 Copyright Act subsequently gave authors and their heirs the right to terminate transfers such as ones made in 1930s. Taking advantage of that opportunity, in 1983 Christoper Robin Milne and SSI drafted a new contract; Disney and SSI did likewise.

In 1991 SSI sued Disney in California State court, claiming underpayment of royalties. The suit was bitterly fought and both parties were found to have engaged in misconduct. SSI's however, was found sufficiently egregious that its suit was dismissed in 2006. The dismissal was affirmed on appeal in 2007.

Based on a 1998 amendment to the copyright law, Milne's granddaughter attempted to terminate the 1983 agreement. A second, supporting suit, funded by Disney, was instituted in a federal district court in California. Her arguments were rejected there, however, as well as by the Ninth Circuit in 2005.

Apparently beginning in 2006, SSI filed a series of counterclaims in the same suit. Most alleged that Disney infringed its intellectual property rights. Partly because those claims were not filed until SSI had lost its state suit and partly because the counterclaims are seen as inconsistent with what SSI had argued in the state litigation, the district court's 2009 opinion finds them to lack merit.

Besides offering those counterclaims, in 2006 SSI also filed a series of motions before the PTO's Trademark Trial and Appeal Board (TTAB). Those motions opposed registration of some and sought cancellation of other Pooh-related Disney trademarks. The TTAB, however, ruled that the California federal district court's opinion had resolved key issues in Disney's favor. That opinion, affirmed by the Federal Circuit in the instant case, bars SSI from asserting its claims in the PTO.

Although Judge Reyna disagreed about whether SSI should be barred, Disney's trademark arsenal is intact and available for use against anyone inclined to challenge its lucrative Pooh franchise. Moreover, after A.A. Milne's last copyright expires in 2023, it will apparently have no obligation to pay royalties under the 1983 agreement.

Panel: Chief Judge Rader and Circuit Judges O'Malley and Reyna

Date of Opinion: Dec. 21, 2012

Docket Number: 2011-1593. The opinion is available at www.cafc.uscourts.gov/opinions-orders/0/all/11-1593

Decided: Affirmed

Case Alert Author: Thomas G. Field, Jr.

Counsel: Roger L. Zissu et al. for appellant; Daniel M. Petrocelli et al. for appellee.

Author of Opinion: Chief Judge Rader (majority); Circuit Judge Reyna (dissent)

Case Alert Circuit Supervisor: Thomas G. Field, Jr.

Edited: 01/18/2013 at 10:50 AM by Media Alerts Moderator

    Posted By: Thomas Field @ 01/07/2013 02:17 PM     Federal Circuit  

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