Apple Computer, Inc. v. Podfitness, Inc.

Filing 37

MEMORANDUM in Opposition re 31 MOTION to Stay filed byApple Inc.. (Related document(s) 31 ) (Abrams, Andrew) (Filed on 4/17/2007)

Apple Computer, Inc. v. Podfitness, Inc.

Doc. 37

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David J. Miclean (#115098/[e-mail]) FISH & RICHARDSON P.C. 500 Arguello Street, Suite 500 Redwood City, California 94063 Telephone: [phone] Facsimile: [phone] Lisa M. Martens (#195824/[e-mail]) Andrew M. Abrams (#229698/[e-mail]) FISH & RICHARDSON P.C. 12390 El Camino Real San Diego, California 92130 Telephone: [phone] Facsimile: [phone] Attorneys for Plaintiff APPLE COMPUTER, INC.

UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA (OAKLAND DIVISION) APPLE COMPUTER, INC., Plaintiff, v. PODFITNESS, INC., and DOES 1-100, inclusive, Defendants. Case No. C 06-5805 SBA PLAINTIFF APPLE COMPUTER, INC.'S OPPOSITION TO DEFENDANT'S MOTION TO STAY Date: May 8, 2007 Time: 1:00 pm Courtroom: 3, 3rd Floor Judge: Hon. Saundra B. Armstrong

Plaintiff Apple Computer, Inc. ("Apple") hereby submits this opposition to Defendant' s Motion to Stay: I. INTRODUCTION Defendant Podfitness' Motion to Stay this case is a thinly veiled attempt to derail a

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case in discovery with a trial date on June 23, 2008 that will resolve all issues between the parties, in hopes of having it languish for years in the TTAB1. As the TTAB cannot even address the majority of Apple' s claims, Defendant' s attempt to avoid the litigation of issues in this case should not be countenanced and the Motion To Stay should be denied. All of Defendant' s arguments in support of this motion rely upon a total mischaracterization of this dispute as one involving a single, narrow issue: the comparison of the marks IPOD and PODFITNESS in a vacuum. This is subterfuge. Contrary to Defendant' s attempt to create a straw man, the issues raised in the TTAB proceeding only encompass a fraction of the issues implicated in this litigation. Based on the facts particular to this case, Apple alleges eight separate causes of action (citing both federal and state statutes) for trademark infringement, trademark dilution, trade dress infringement, unfair competition, false designation of origin, and misleading advertising2. [Abrams Decl. ¶ 3.] These claims do not revolve solely around a determination of whether the PODFITNESS mark, standing alone, is confusingly similar to Apples' IPOD mark. More importantly, the TTAB cannot make a legally binding determination with respect to any of these claims; it is merely limited to decisions concerning whether a particular mark ("PODFITNESS") is registrable. Apple' s complaint is based upon specific facts which cannot be addressed by the TTAB in a simple registrability ruling. Such facts establish that Defendant has sought to improperly profit off of the good will established by Apple (including, but not limited to its famous IPOD brand). Based on ample evidence acquired by Apple both independently and
Opposition No. 91/173,003 was filed by Apple on September 20, 2006. Apple filed a motion to stay this TTAB proceeding on December 19, 2006, a motion which is still pending before the TTAB. See John M. Murphy, "Playing the Numbers: A Quantitative Look at Section 2(d) Cases Before The Trademark Trial and Appeal Board," 94 TMR 800 (2004). In this article, Murphy examines a sample of 67 TTAB cases. He found that the median resolution time was 3.2 years, with 60% of the cases taking longer than 3 years and 22% of the cases taking longer than 4 years to complete. Abrams Decl. ¶ 14. 2 Apple also intends to raise other fact-specific claims in an amended complaint, including copyright infringement, cybersquatting, breach of contract, inducement of breach of contract, and intentional interference with economic advantage.
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through formal discovery, it has become readily apparent that Defendant has engaged in numerous illicit activities, all for the purpose of creating confusion as to the source of its goods and services, and creating a false impression of an association with Apple and Apple' s products. Such activities will be further outlined in this brief, and include the running of advertisements featuring Apple CEO Steve Jobs' name and mimicking Apple' s awardwinning "silhouette" commercials; they also include the direct copying of Apple' s recognized white earbud trade dress and the use of Apple' s IPOD mark as a metatag, sponsored search engine keyword, and domain name. Further, Defendant requires its subscribers to use Apple' s proprietary ITUNES software in conjunction with its own derivative application in order to access its services, thereby violating licensing and developer agreements in place between the parties. Defendant alleges in its Motion to Stay that there is a vague "industry dispute" over the right to use POD-formative marks, and that some efficiency would be gained by having the TTAB first adjudicate "whether POD-formative terms are entitled to federal trademark registration." This contention is completely meritless, as Defendant' s activities are unique to this matter, and do not have anything to do with Apple' s disputes with any other parties. Simply put, it is not possible for the TTAB to do what Defendant requests, and to issue a generalized ruling in a completely unrelated matter that would somehow be authoritative in determining whether Defendant infringes Apple' s marks. As much as Defendant would like to distract the Court' s attention from its specific infringing activities, the determinations of the claims raised in this litigation (e.g., trademark infringement, dilution, false advertising and unfair competition3) can only be addressed by this Court, and not by the TTAB. The TTAB cannot make a legally binding determination with respect to any of Apple' s causes of action in this case; it is merely limited to decisions concerning whether a particular mark is registrable. If Defendant gets its wish to stay this case, even after the
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See footnote 2.

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TTAB proceeding concludes years from now4, the outcome of the administrative proceeding would not affect the legal standard applied in the federal trademark infringement claim or the scope of the required fact-finding. The Court must still independently determine the validity and priority of the marks and the likelihood of consumer confusion as to the source of the goods and services, with this latter issue to be resolved not by reference to a registration determination by the TTAB but by application of the multi-factor balancing test set forth in AMF, Inc. v. Sleekcraft Boats, 599 F.2d 341 (9th Cir. 1979). Other claims such as false advertising and unfair competition are even more clearly outside the scope of the TTAB' s authority. Defendant' s efforts to derail the instant case, which will resolve all issues and be completed by June 2008, by raising unsubstantiated and irrelevant allegations about a supposed " need" for the TTAB to issue a general directive on " POD-formative" marks, is meritless, and should be rejected. In order to achieve efficient and full adjudication of all of the legal and factual issues raised in this current litigation, Apple respectfully submits that the instant action should proceed while the corresponding TTAB matter is suspended5. II. ARGUMENT

A. Defendant's motion is intended merely to delay the prompt and comprehensive adjudication of this dispute. Defendant' s true motivation in filing this Motion to Stay is transparent: to delay the prompt and comprehensive adjudication of all of the legal issues raised in this dispute. It is unquestionable that allowing the TTAB proceeding to proceed first while suspending this civil action would result in significant judicial inefficiency and unnecessary expense to the parties. This is because the sole issue that the TTAB is qualified to determine, the
See footnote 1; Abrams Decl. ¶ 14. Apple filed a motion to stay the TTAB proceedings on December 19, 2006. Apple' s motion to stay, which is far more appropriate than this current motion for the reasons described herein, has been pending at the TTAB for nearly four months without being resolved. This is yet another example of the delays which would be caused by granting Defendant' s motion.
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registrability of Podfitness' trademark applications6, only represents a small fraction of the issues implicated in this litigation. Despite Defendant' s self-serving attempts to mischaracterize this dispute as one which only involves a comparison of the marks IPOD and PODFITNESS in a vacuum, the reality is that this litigation encompasses far more, as detailed below. On September 21, 2006, Apple filed a complaint against Defendant alleging eight separate causes of action (citing both federal and state statutes) for trademark infringement, trademark dilution, trade dress infringement, unfair competition, false designation of origin, and misleading advertising7. [Abrams Decl. ¶ 3.] The crux of Apple' s case, and the basis for each of these claims, hinges upon the following particular facts which can only be addressed by this Court, and not by the TTAB. These facts demonstrate the systematic targeting of Apple' s consumer base in a manner which is likely to create public confusion as to the possible affiliation between the parties, and also suggest Defendant' s bad faith intent in adopting its " Pod" formative marks. Indeed, Defendant' s entire marketing strategy appears to consist of hitching its wagon to Apple' s star. The evidence of bad faith is highly relevant, and overwhelming: · · The admitted creation of Podfitness to take advantage of the " white hot" made-for-IPOD market. [Abrams Decl. ¶ 4.] The " Steve Jobs" advertising campaign, in which Defendant issued fake letters to Apple' s CEO thanking him for the invention of the IPOD. [Abrams Decl. ¶ 5.] The running of imitation " silhouette" advertisements featuring images of Apple' s IPOD and Apple' s famous white earbud trade dress. [Abrams Decl. ¶ 6.]

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See Freecyclesunnyvale v. Freecycle Network, Inc., No. C 06-00324 CW, 2006 WL 870688, *6 (N.D. Cal. April 4, 2006), " The PTO cannot decide issues of trademark infringement; this is a matter that must be decided in a court." (citing Goya Foods, Inc. v. Tropicana Prods., Inc., 846 F.2d 848, 853-54 (2d Cir. 1988) (" outcome of PTO proceedings does not affect legal determination of infringement claim; district court must still independently decide validity and priority of marks and likelihood of consumer confusion" )). 7 Apple also intends to raise other fact-specific claims in an amended complaint, including copyright infringement, cybersquatting, breach of contract, inducement of breach of contract, and intentional interference with economic advantage.

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The copying of Apple' s earbud trade dress. On information and belief, Defendant used a digital copy of Apple' s Earbud Trade Dress and merely removed the " r" , and revised the dots to create its corporate logo. [Abrams Decl. ¶ 7.] Defendant' s copying and prominent display of Apple' s registered IPOD mark throughout its www.podfitness.com website, including in the tagline: " Put a Personal Trainer right on your IPOD®," and the bold caption: " Customized IPOD Workouts. On information and belief, Defendant directly copied images of the IPOD player from Apple' s website at www.apple.com to use on its own www.podfitness.com website. [Abrams Decl. ¶ 8.] Defendant' s use of Apple' s registered IPOD mark in the metatags of each page on its www.podfitness.com website, causing Defendant' s website to appear as a " hit" when a query is conducted through a search engine for the following phrases: " IPOD workout music" ; " I POD trainer" ; " I POD workout" ; " I POD workouts" ; " IPOD workouts" ; " IPOD trainer." [Abrams Decl. ¶ 9.] Defendant' s listing as a sponsored link on the search engine www.google.com in connection with the keywords " IPOD Workout" and " IPOD Fitness," causing a link to the www.podfitness.com website to appear prominently in the top banner or right margin of the screen in response to a search query for such terms. [Abrams Decl. ¶ 10.] Defendant' s use and registration of the domain names ipodfitness.com and ipodworkouts.com to automatically re-direct to its homepage at podfitness.com. [Abrams Decl. ¶ 11.] Defendant' s unauthorized adoption and use of Apple' s " SHUFFLE" logo (Registration No. 3,067,950), and certain aspects of the MADE FOR IPOD logo (Application Serial No. 78/689,534). [Abrams Decl. ¶ 12.]

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Moreover, Defendant' s services entirely depend on Apple' s proprietary ITUNES software to store, manage, play, control the audio content, and encode the mixed media into MPEG-4 format. [Abrams Decl. ¶ 13.] Apple alleges that Defendant' s Podfitness Mixer, which its subscribers must also download in order to create the customized audio files, represents a derivative work of the ITUNES. By creating such a derivative work, Defendant not only breaches its development and SDK License Agreements with Apple, but causes its subscribers to breach the " click-through" license agreement they agreed to when downloading ITUNES. These are facts which are of vital importance in determining Defendant' s liability and damages for trademark and copyright infringement, dilution, unfair competition, breach of 6
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contract, inducement of breach of contract, interference with economic advantage, and cybersquatting. Yet, the impact of this " real-world" evidence is minimal in determining mere trademark registrability, which is all the Patent and Trademark Office is qualified to resolve8. Thus, every single one of these claims would require de novo re-litigation on considerably " stale" three-to-four year-old9 evidence before this Court, after the TTAB proceedings were concluded10. Defendant knows this, yet still argues with a straight face that " [o]btaining the TTAB' s opinion on this issue [of likelihood of confusion] will promote judicial efficiency..." Such an assertion is flatly inaccurate, and disingenuous to say the least. Does Defendant truly believe that pursuing a TTAB proceeding to a final determination, which has a median resolution time of 3.2 years11, then reverting to federal litigation to reexamine de novo the likelihood of confusion issue as well as all of the other multitude of issues represents the most efficient manner to approach this dispute? This civil case is currently proceeding smoothly through discovery, with trial set for June 200812. [Abrams Decl. ¶ 15.] It is hard to fathom how Defendant proposes to conduct a three-year administrative proceeding, then revert to this civil litigation, and finish it all before next June. The reality is that Defendant does not seek to accomplish such a miracle; this Motion to Stay is merely a subterfuge which would allow Podfitness to continue its infringing and diluting conduct while the matter languishes for years in the " black hole" of TTAB litigation.
See Freecyclesunnyvale, 2006 WL 870688 at *6; Goya Foods, 846 F.2d at 853-54 . Even with respect to registrability, the only issue the TTAB is qualified to resolve, a decision by the TTAB is only advisory in respect to the disposition of the case pending in the District Court. T.B.M.P. § 510.02(a) (also stating that a decision by the District Court is binding upon the Patent and Trademark Office). Thus, while a TTAB determination of registrability may possibly provide some modicum of guidance to this Court, a District Court' s review of a TTAB' s decision is still essentially " an independent judicial proceeding." Goya Foods, 846 F.2d at 852 (2d Cir.1988). 9 See footnote 1; Abrams Decl. ¶ 14. 10 Goya Foods, 846 F.2d at 853-54 (2d Cir. 1988) (" outcome of PTO proceedings does not affect legal determination of infringement claim; district court must still independently decide validity and priority of marks and likelihood of consumer confusion" ) 11 See footnote 1; Abrams Decl. ¶ 14. 12 The Court set this date, which was proposed by Defendant, over Apple' s objections. Apple sought a trial date of November 5, 2007. Defendant' s insistence on a seventh-month delay for trial in this matter is consistent with its overall strategy of seeking to delay a final adjudication on the merits while it continues its infringing and diluting conduct.
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In addition to its considerably longer resolution time13 and inability to resolve the majority of issues at stake, the TTAB simply is incapable of providing Apple the complete equitable and monetary relief it seeks against Defendant. If the parties were required to first proceed in the administrative proceeding, and judgment were then rendered by the TTAB, Apple, who is being damaged by Defendant' s continuing use of infringing and diluting marks and improper use of the ITUNES software would still need to seek an injunction from a federal district court to require Defendant to cease its harmful actions. Nor can the TTAB grant the monetary relief due to Apple which takes into account the economic harm caused by Defendant' s actions as well as Defendant' s unjustly earned profits. Defendant is fully aware that the TTAB cannot provide such relief, which is exactly why it seeks to substantially delay this current civil action. Judicial economy warrants a consolidation of issues, so that the parties may avoid unnecessary and duplicative proceedings. See Goya Foods, Inc. v. Tropicana Products, Inc. v. Tropicana Products, Inc., 846 F.2d 848, 853-54 (2d Cir.1988) (" the interest in prompt adjudication far outweighs the value of having the views of the [TTAB]" ; there is often urgency in infringement actions because ongoing business is involved and harm may be accruing). This Court' s jurisdiction is far broader than the TTAB, encompassing both the power to decide the issues of registrability of Defendant' s marks as well as infringement, dilution, and a host of other legal issues brought about through Defendant' s marketing efforts designed to insinuate an affiliation between the parties. The decision that this Court will render will resolve all of the issues in dispute between the parties and thereby allow Apple to receive complete relief for its claims in a single forum. A stay will only serve to unnecessarily delay the comprehensive resolution of the parties' dispute. This result, which is what Defendant seeks to achieve with this Motion, is not in the interests of judicial economy.
As an example, Apple' s motion to stay the TTAB proceeding has been pending at the TTAB for nearly four months without being resolved.
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B. The TTAB cannot decide issues of trademark infringement; this is a matter that must be decided in a court. Defendant' s argument for staying the present action hinges upon the " doctrine of primary jurisdiction." (See Motion to Stay, p. 4:25-26, p. 5:1-11.) The doctrine is a general theory which states that when a court is faced with a question requiring the exercise of administrative discretion, it should allow the appropriate federal administrative agency to rule on the issue when possible. Courts normally examine the facts of each particular case when deciding whether or not it should be applied. C-Cure Chemical Co., Inc. v. Severe Adhesives Corp., 571 F.Supp. 808, 823 (W.D.N.Y.1983) (quoting United States v. Western Pacific Railway Co., 352 U.S. 59, 64 (1956)). Defendant conveniently fails to mention that this doctrine is generally not applicable to cases involving trademark infringement. See W & G Tennessee Imports, Inc. v. Esselte Pendaflex Corp., 769 F.Supp. 264, 265 (M.D. Tenn. 1991) (rule of primary jurisdiction " not normally applied in cases where questions of trademark validity and trademark infringement are involved" ) (citing Goya Foods, Inc. v. Tropicana Products, Inc. v. Tropicana Products, Inc., 846 F.2d 848 (2d Cir.1988)); American Cyanamid Co., v. Campagna Per La Farmacie In Italia S.P.A., 678 F.Supp. 1049 (S.D.N.Y.1987), aff'd 847 F.2d 53 (2d Cir.1988). Furthermore, deferral to the Patent and Trademark Office in cases where trademark infringement is alleged is unnecessary where the issues, as is the case here, do not involve highly technical questions or subject matter. American Cyanamid, 678 F.Supp. at 1054-55. Goya Foods, supra, is the only Circuit Court decision to consider the primary jurisdiction doctrine in relation to a trademark case. In that case, the issues of validity and infringement were both before the Court at the time the Court was considering whether it should stay proceedings. In deciding not to enter the stay, the Court reasoned: If a district court action involves only the issue of whether a mark is entitled to registration and if subject matter jurisdiction is available, the doctrine of primary jurisdiction might well be applicable, despite the differences between the trademark registration scheme and other regulatory patterns. In such a case, the benefits of awaiting a decision would rarely, if ever, be outweighed 9
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by the litigants' need for a prompt adjudication. But where, as in the pending case, a district court suit concerns infringement, the interest of prompt adjudication far outweighs the value of having the views of the PTO. Whether a litigant is seeking to halt an alleged infringement or, as in this case, seeking a declaration of non-infringement, it is entitled to have the infringement issue resolved promptly so that it may conduct its business affairs in accordance with the court' s determination of its rights. (citations omitted). Goya Foods, 846 F.2d at 854-55. In the present case, the district court suit similarly concerns trademark infringement (as well as a host of other legal issues which cannot be determined by the TTAB, such as dilution, unfair competition, and false advertising)14. As this very Court recently pointed out in Freecyclesunnyvale v. Freecycle Network, Inc., No. C 06-00324 CW, 2006 WL 870688, *6 (N.D. Cal. April 4, 2006), " The PTO cannot decide issues of trademark infringement; this is a matter that must be decided in a court." (emphasis added) (citing Goya Foods, Inc. v. Tropicana Prods., Inc., 846 F.2d 848, 853-54 (2d Cir. 1988) (" outcome of PTO proceedings does not affect legal determination of infringement claim; district court must still independently decide validity and priority of marks and likelihood of consumer confusion" )). Similarly, in this case, the TTAB is simply incapable of resolving all of the issues between the parties. Therefore, the Court should deny Defendant' s Motion to Stay, just as it denied the defendant' s motion in Freecyclesunnyvale. C. The TTAB's special expertise is not of great significance where the trademark issues do not raise highly technical matters outside the normal business of the district court. The cases that Defendant cite in support of the proposition that the Court should defer to the TTAB' s " special expertise" in determining trademark issues15 are in the significant minority. Not surprisingly, Defendant fails to mention that the prevailing (and more logical) approach is that a stay should be denied in matters involving infringement. The
The amended complaint will add further claims which are far out of the realm of the TTAB' s expertise, including breach of contract, copyright infringement, and cybersquatting. 15 Citicasters Co. v. Country Club Communications, 1997 WL 715034 (C.D.Cal. July 21, 1997); Nat'l Mktg. Consultants, Inc. v. Blue Cross Blue Shile Ass'n, 1987 WL 20138 (N.D.Ill. Nov. 19, 1987); C-Cure Chem. Co., Inc. v. Secure Adhesives, Corp., 571 F.Supp. 808 (W.D.N.Y.1983); Driving Force, Inc. v. Manpower, Inc., 498 F.Supp. 21 (E.D.Penn.1980).
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overwhelming majority of courts, including this one, have held that the primary jurisdiction doctrine does not apply in such cases. See, e.g., Freecyclesunnyvale v. Freecycle Network, Inc., No. C 06-00324 CW, 2006 WL 870688 (N.D. Cal. April 4, 2006); McGuire v. Regents of the Univ. of Michigan, 2000 WL 1459435 (S.D.Ohio Sept. 21, 2000); Fight for Children, Inc. v. Fight Night, Inc., 1997 WL 148643 (D.D.C. Mar. 26, 1997); Maritz v. Cybergold, Inc., 947 F.Supp. 1328 (E.D. Missouri Aug. 19, 1996); Forschner Group, Inc. v. B-Line A.G., 943 F.Supp. 287 (July 17, 1996); PHC, Inc. v. Pioneer Healthcare, Inc., 75 F.3d 75 (1st Cir.1996); Cash v. Brooks, 906 F.Supp. 450 (E.D.Tenn.1995); Krause Int'l, Inc. v. Reed Elsevier, Inc., 866 F.Supp. 585 (D.D.C.1994); Hanlon Chem. Co., Inc. v. Dymon, Inc., 1991 WL 12869 (D.Kan. Jan. 30, 1991); W & G Tennessee Imp., Inc. v. Esselte Pendaflex Corp., 769 F.Supp. 264 (M.D.Tenn.1991); MCA, Inc. v. Mid-Continent Adjustment Co., 1988 WL 89074 (N.D.Ill.1988); Goya Foods, 846 F.2d at 848; Am. Bakeries Co. v. Pan-O-Gold Baking Co., 650 F.Supp. 563 (D.Minn.1986). These cases present a number of reasons why the rationale behind the primary jurisdiction doctrine is not furthered by its application in the context of this case. First, the doctrine is only invoked in cases where an administrative agency has a unique expertise in a particular area that courts are unfamiliar with. One of the key areas at issue here ­ the likelihood of consumer confusion ­ is one well " within the conventional competence of the courts." Goya Foods, 846 F.2d at 853; Am. Bakeries Co., 650 F.Supp. at 567. Indeed, " this is a legal standard with which courts have long-standing familiarity in resolving suits arising under both the Lanham Act and the common law of trademark infringement and unfair competition." Goya Foods, 846 F.2d at 853. Thus, Defendant' s effort to establish that " likelihood of confusion" is the core issue in the present action (Motion to Stay, pp: 7-8) is effectively a " red herring" argument which is irrelevant to the determination of this Motion. This is especially true given that Congress has expressly given Courts the authority to decide trademark issues. See MCA, Inc., 1988 WL 89074, at *3 (citing 15 U.S.C. §§ 1070, 11
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1071, & 1119); see also 15 U.S.C. §§ 1114, 1120 & 1125. An applicant for registration or a party to an opposition proceeding may either appeal the decision to the United States Court of Appeals for the Federal Circuit or bring a civil action in a United States District Court. See Goya Foods, 846 F.2d at 852 (citing 15 U.S.C. § 1071(a) & (b)). Moreover, as discussed previously, Apple's case against Defendant is not solely about trademark registration. Apple' s action concerns infringement as well a number of other claims which do not at all involve the likelihood of consumer confusion, including dilution and false advertising. An anticipated amended complaint will also add claims for breach of contract, copyright infringement, and cybersquatting. Not only is this Court far more competent to resolve these significant issues than an administrative board with no expertise in such areas, but it must resolve this issues, because the TTAB is not authorized to do so. Whereas this Court may promptly decide all of the outstanding issues in this dispute, the TTAB can only partially resolve a fraction of the issues in a process that takes years. Thus, a stay of this civil action simply does not make any sense, and it will only serve to unnecessarily delay the comprehensive resolution of the parties' dispute. D. The determination of the claims at issue will be made through an analysis of Defendant's specific actions, and will not be contingent upon the rulings of other proceedings involving POD-formative marks. Contrary to Defendant' s claims, this case is not a broad referendum on the registrability of all marks incorporating the term " POD." Nor is it possible for the TTAB to issue some generalized ruling in a completely unrelated matter that would somehow be authoritative in determining whether Defendant infringes Apple' s marks. As much as Defendant would like to distract the Court' s attention from its specific activities, the determinations of the claims raised and intended to be raised in this litigation (e.g., trademark infringement, trade dress infringement, copyright infringement, unfair competition, breach of contract, cybersquatting, etc.) are plainly fact-driven. The TTAB cannot rule on such causes of action, nor will it address Defendant' s particular, reprehensible actions. Only this Court 12
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can do so. Defendant desperately argues that uniform results would be obtained if the TTAB were allowed to determine whether POD-formative terms are likely to be confused with Apple' s IPOD marks16. Yet it provides absolutely no legal authority for this incredible proposition, and utterly fails to acknowledge that each matter involves a different mark, different goods and/or services, different marketing and sales strategies, and different degrees of bad faith. There are very few issues common to these cases, other than Apple and its IPOD marks. By Defendant' s reasoning, should all trademark disputes involving a single plaintiff' s marks always be resolved in some sort of universally applicable administrative ruling? Defendant seeks to characterize this dispute as one involving a single, narrow issue: the comparison of the marks IPOD and PODFITNESS in a vacuum. This is simply not accurate. By adopting such an approach, Defendant is conveniently attempting to wash away all of its other transgressions which form the very basis of this current action, and serve to distinguish this matter from each of Apple' s other disputes. Indeed, as set forth above, the specific facts of this case indicate a pattern of bad faith on the part of Defendant in a manner designed to create public confusion as to the possible affiliation between the parties. This unique set facts is crucial in determining Defendant' s liability and damages in this particular civil case for trademark and copyright infringement, dilution, unfair competition, breach of contract, inducement of breach of contract, interference with economic advantage, and cybersquatting. Yet, the importance of this
In so arguing, Defendant again plays fast and easy with the facts. Defendant has been advised in writing by Apple that Podfitness' " over 100 pod-formative actions" allegation is categorically and patently false, but nonetheless persists in stating this misleading figure to the court. Such blatant disregard for the accuracy of its information is reprehensible, and irresponsible. Defendant' s figure includes Apple' s requests for extensions of time to oppose certain applications, which are not oppositions. Further, Defendant assumes that all the oppositions are still pending. Had Defendant actually reviewed any of the dockets of those proceedings, which include proceedings initiated five years ago, it would have noted that a great many of them have been terminated. Lastly, Defendant has counted some matters twice by counting it once when Apple took an extension of time to oppose an application and counting it again once Apple actually filed the opposition. The actual number of active oppositions that Apple is prosecuting with regard to POD-formative marks is actually 17 (of which only 5 use " POD" as a prefix), a far cry from " over 100" figure exploited repeatedly by Defendant. [Abrams Decl. ¶ 16.]
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PLAINTIFF APPLE COMPUTER, INC.' S OPPOSITION TO DEFENDANT' S MOTION TO STAY Case No. C 06-5805 SBA

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evidence is minor in determining mere registrability, which is all the Patent and Trademark Office is qualified to resolve. Certainly, Apple' s other administrative proceedings involving third-party users of POD-formative marks will not broach these identical issues. Accordingly, Defendant' s allegation that efficiency would be gained by having the TTAB first adjudicate " whether POD-formative terms are entitled to federal trademark registration" is completely without merit. Finally, Defendant makes a great deal of the fact that it alone, allegedly, has been the subject of a civil lawsuit filed by Apple, although Apple has instituted opposition proceedings against other POD-formative marks. The legal rationale for this argument is unclear. Even if true, the fact that Defendant has been sued while other parties have not is irrelevant, as Apple is certainly entitled to decide for itself when it needs to seek the full and final relief provided by a court to protect its famous IPOD mark from infringing conduct. III. CONCLUSION Defendant has failed to raise a single valid reason why the TTAB would be better suited than this Court to first decide this case. In order to achieve efficient and full adjudication of all of the legal and factual issues raised in this current litigation, Apple respectfully submits that the instant action should proceed while the corresponding TTAB matter is suspended.

FISH & RICHARDSON P.C.

By: /s/ David J. Miclean David J. Miclean Lisa M. Martens Andrew M. Abrams Attorneys for Plaintiff APPLE COMPUTER, INC. 14
PLAINTIFF APPLE COMPUTER, INC.' S OPPOSITION TO DEFENDANT' S MOTION TO STAY Case No. C 06-5805 SBA