J.T. Colby & Company, Inc. et al v. Apple, Inc.

Filing 42

AMENDED AND SUPPLEMENTAL COMPLAINT amending 1 Complaint against Apple, Inc. with JURY DEMAND.Document filed by Publishers LLC, J.T. Colby & Company, Inc., Ipicturebooks LLC, J.Boyston & Company. Related document: 1 Complaint, filed by J.Boyston & Company, J.T. Colby & Company, Inc., Publishers LLC, Ipicturebooks LLC. (Attachments: # 1 Exhibit A-D, # 2 Exhibit E, # 3 Exhibit F, # 4 Exhibit G-M, # 5 Exhibit N-Q, # 6 Exhibit R-T, # 7 Exhibit U-X, # 8 Exhibit Y-Z)(lmb)

both hardcover and paperback, under the “ibooks” mark. Moreover, Preiss pioneered the
development and sale of electronic books, which he sold through a variety of entities under the
marks “ibooks” and “ipicturebooks”. Beginning in January 2000, Preiss published thousands of
electronic books bearing the “ibooks” and “ipicturebooks” trademarks, many of which are by
well-known authors and/or feature well-known fictional characters.
3.

Following his purchase of the “ibooks” and “ipicturebooks” business from Preiss,

Colby has continued to publish a wide range of books from well-known authors under both the
“ibooks” and “ipicturebooks” marks. Plaintiffs’ “ibooks” and “ipicturebooks” marks have,
however, been overwhelmed by Apple’s use of the “iBooks” mark to identify the electronic
books available to users of its iPad as well as the application (“app”) that allows these books to
be displayed on the iPad screen. Apple has also begun offering “iBooks” to users of its iPhone
and to consumers who visit its iTunes store.
4.

While Apple has long held a trademark on the name IBOOK for computers, and at

one time sold a portable computer known as the “iBook”, Apple never utilized this mark as a
designation for electronic books, or an application for the delivery of electronic books, until
April 2010 when it launched the iPad and began using the name “iBooks”. Moreover, Apple
never protested Preiss or Colby’s use of the marks “ibooks” or “ipicturebooks” throughout the
thirteen years those marks have been used in connection with the sale of print and electronic
books.
5.

Apple well knows that its rights in the IBOOK mark for computers are narrow and

do not extend to the mark’s use on electronic books, bookstores and libraries, or on apps
denoting electronic books. In 1999, in order to secure registration of the IBOOK trademark from
the U.S. Patent and Trademark Office (“PTO”), Apple entered into an agreement with Family
Systems, Ltd., a U.K. company that had previously filed for registration of the identical mark for

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computer software used to create interactive, user-modifiable electronic books. Under that
agreement, Apple acknowledged that its use of the mark IBOOK for computers was
distinguishable from, and not confusingly similar to, Family Systems’ use of IBOOK on
computer software used to create interactive, user-modifiable electronic books. In early 2010,
Apple purported to purchase the Family Systems IBOOK mark, and to amend that mark’s
registration to cover the plural form of the mark, IBOOKS. However, as set forth more fully
below, Apple’s purchase of the mark was an invalid assignment in gross and thus Apple holds no
rights in the Family Systems mark beyond the right to prevent Family Systems from resuming
use of the mark.
6.

Apple’s April 3, 2010, launch of the iPad was the subject of widespread anticipation

and publicity. During its first day on the market, over 300,000 iPads were sold; after one week,
more than 500,000 had been sold. While Apple projected first-year iPad sales of five million,
Apple actually sold over 15 million iPads in the nine months the product was on the market in
2010. Apple has spent tens of millions of dollars to advertise and promote the iPad and its
various apps, including the “iBooks” electronic library app. This enormous sales volume and the
accompanying advertising expenditures is likely to – and in fact already has – overwhelmed the
reputation and good will of plaintiffs’ “ibooks” and “ipicturebooks” marks. As a result, Apple’s
massive sales, advertising and delivery of “iBooks” has forever linked “iBooks” with Apple in
the minds of consumers.
JURISDICTION AND VENUE
7.

This is an action for infringement of a common law trademark and false designation

of origin in violation of Section 43(a)(i)(A) of the Lanham Act, 15 U.S.C. § 1125(a)(i)(A), and
for related claims under the common law of New York.

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8.

This Court has subject matter jurisdiction over this action pursuant to 28 U.S.C.

§ 1331 and § 1338(a) and (b). Venue in this District is proper pursuant to 28 U.S.C. § 1391 (b)
and (c).
THE PARTIES
9.

Plaintiff J.T. Colby & Company, Inc. d/b/a Brick Tower Press (“Brick Tower”) is a

New York corporation owned by John Colby and currently has its principal office at 5 Dering
Woods Road, Shelter Island Heights, New York. In June 2011, Brick Tower’s principal office
was located at 1230 Park Avenue, New York, New York, and Brick Tower still maintains a
business location there at the time of this filing.
10. Plaintiff J. Boylston & Company, Publishers LLC (“Boylston”) is a New York
corporation owned by John Colby and currently has its principal office at 5 Dering Woods Road,
Shelter Island Heights, New York. In June 2011, Boylston’s principal office was located at 1230
Park Avenue, New York, New York, and Boylston still maintains a business location there at the
time of this filing.
11. Plaintiff ipicturebooks LLC is a Delaware corporation that is wholly owned by
Boylston. Its principal office is currently located at 5 Dering Woods Road, Shelter Island
Heights, New York. In June 2011, ipicturebooks LLC had its principal office at 1230 Park
Avenue, New York, New York, and ipicturebooks LLC still maintains a business location there
at the time of this filing.
12. Defendant Apple, Inc. is a California corporation with its principal place of business
at One Infinite Loop, Cupertino, California. Apple is one of the largest and most successful
corporations in the United States and does business in all 50 states, including New York.
Apple’s new iPad, with its iBooks application and library, has been extensively advertised,
promoted and sold in New York State.

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THE “ibooks” FRANCHISE
13. In or about January 1999, Preiss founded ibooks, inc. Between 1999 and November
2006, when Colby purchased the assets of ibooks, inc., the company published more than 1000
hardcover and paperback books under the “ibooks” imprint. Throughout most of this period, the
books were distributed by Simon & Schuster. In 2006, Publishers Group West (“PGW”)
succeeded Simon & Schuster as the “ibooks” distributor. Since 2007, “ibooks” have been
distributed by National Book Network (“NBN”). Each book bears the “ibooks” name on the
spine and on the copyright page. Annexed as Exhibit A is the copyright page of Arthur C.
Clarke’s Venus Prime by Paul Preuss, a paperback published in January 2000 by ibooks, inc.,
showing the ibooks imprint, corporate name, and website address.
14. Subsequent to Colby’s purchase of the ibooks business, more than 90 new titles –
both print and electronic – have been published under the “ibooks” imprint. The distribution of
“ibooks” is currently handled by Ingram’s Lightning Source distribution system in the United
States, Canada, Australia and New Zealand, and by Gazelle Book Services in the United
Kingdom. The Lightning Source distribution system includes but is not limited to Ingram, Baker
& Taylor, NACSCORP, and Espresso Book Machine in the United States; Adlibris, Bertrams,
Blackwell, Gardners, and Wrap Distribution in the United Kingdom; and DA Information
Services, Dennis Jones & Associates, James Bennett, and The Nile in Australia. NBN distributes
ibooks graphic novels under the name Byron Preiss Graphic Novels in the United States, while
ibooks distributes titles not handled by either Lightning Source or NBN internally. The rights to
all of the more than 1000 hard and soft cover books that have been published under the “ibooks”
imprint are now owned or licensed by plaintiff Boylston. These books are available from most
booksellers, including Amazon and Barnes & Noble. Barnes & Noble, for example, currently
carries 946 “ibooks” print books that are available via its website.

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15. The “ibooks” print books include a large number of famous books from well-known
authors. Many of them focus on history, and include:
(1)

Numerous books on World War II by Stephen W. Sears, including The
Battle of the Bulge, published to coincide with the 60th anniversary of this
famous battle; The Air War Against Hitler’s Germany, published to
coincide with the 60th anniversary of the Allies’ victory; and Desert War
in North Africa.

(2)

Various military histories including Vietnam: A Reader; The World War II
Reader; The Civil War Reader: 1862; West Point Blue and Gray, by
Thomas Fleming; and The Battle for Jerusalem, by Lt. Gen. Mordechai
Gur.

(3)

Biographies, such as: Jefferson: Architect of America by Page Smith;
Adams: An American Dynasty by Francis Russell; Benjamin Franklin: An
Intimate Portrait by Thomas Fleming; and Einstein: A Relative History by
David Goldsmith and Robert Libbon.

(4)

Books about the ancient world, including Ancient Greece; Ancient Rome;
Ancient China; and John Cullen’s A Walk in Ancient Rome.

(5)

Histories by world famous authors, including Remember the Alamo, by
Robert Penn Warren; The American Heritage History of the American
Revolution, by Bruce Lancaster; The American Heritage New History of
World War II, by Stephen Ambrose; and Notes From The Warsaw Ghetto,
by Emmanuel Rengelblum, a Polish historian who was executed in 1944.

16. The “ibooks” imprint also features a number of well-known fictional works and
annotated versions of classic fictional works, including:

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(1)

Murder Through the Ages – A Bumper Anthology of Historical Mysteries.

(2)

The Essential Dracula, an annotated edition of Bram Stoker’s classic
novel.

(3)

The Essential Phantom of the Opera, an annotated edition of Gaston
Leroux’s classic novel.

(4)

All seven of Harry Kemelman’s Rabbi Small mysteries, including Friday
the Rabbi Slept Late; Saturday the Rabbi Went Hungry; and Sunday the
Rabbi Stayed Home.

(5)

Numerous historical novels by the late Howard Fast, including Bunker
Hill; The Crossing; The Jews - Story of A People; The Immigrants; and
My Glorious Brothers.

(6)

Numerous mysteries by Charlotte MacLeod, known as “America’s Agatha
Christie”, including The Family Vault; Withdrawing Room; The Recycled
Citizen; and The Palace Guard.

(7)

The republication of numerous books that are best known for their motion
picture and television versions, including The Prisoner, by Thomas Disch;
Midnight Cowboy, by James L. Herlihy; The Big Heat, by William P.
McGivern; Psycho, by Robert Bloch; and The Lady Vanishes, by Ethel
Lina White.

17. The “ibooks” line is particularly well-known for its large collection of popular
science fiction and action-adventure novels, many of which are published as “graphic novels” –
fictional works presented in a comic-book-style format. These works include:
(1)

Mark Tiedemann’s famous Isaac Asimov Robot Mysteries, including
Aurora; Mirage; Chimera; and numerous works published in the iRobot,

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Robot City and Robots in Time series.
(2)

Richard Hatch’s famous Battlestar Galactica series of science fiction
books including Destiny; The Tombs of Kobol; The Young Warriors; and
The Saga of a Star World.

(3)

Several science fiction books, including Alien Factor and the Alexa series
of graphic novels, authored by Stan Lee, the creator of Spiderman and the
founder of Marvel Comics.

(4)

Several novels and graphic novels based on the Terminator actionadventure series, including The New John Conner Chronicles (a trilogy of
Terminator novels); Hour of the Wolf; The Terminator: The Burning
Earth; The Terminator: Rewired; and Terminator 2: The Official Graphic
Novel Adaptation.

(5)

Numerous books and anthologies based on the wildly popular X-Men
characters that first appeared in Marvel Comics, including Five Decades of
X-Men, An Anthology; and X-Men: The Chaos Engine Trilogy, a threenovel Omnibus Edition.

(6)

Yearly volumes of science fiction published under the title: The Best of
(Year), which compile the best science fiction stories published in 2001,
2002, 2003, 2004 and 2005.

(7)

Numerous books by Stephen Leigh in the Ray Bradbury Presents time
travel adventure series, including: Dinosaur Tales; Dinosaur World;
Dinosaur Planet; Dinosaur Empire; Dinosaur Samurai; and Dinosaur
Warriors.

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(8)

Several novels by Arthur C. Clarke, including Against the Fall of the
Night, Clark’s Universe and The Sentinel, as well as six books in the
Arthur C. Clarke Venus Prime series.

18. The “ibooks” print books also include numerous graphic novel versions of famous
novels, such as:


Dracula



Frankenstein



Batman



Black Beauty



Sherlock Holmes



The Red Badge of Courage



The Wizard of Oz
THE “ipicturebooks” FRANCHISE

19. Through a joint venture with Time-Warner, Inc., Preiss formed the company now
known as ipicturebooks LLC; this company was purchased by Colby in 2007. Ipicturebooks
LLC creates and sells print and electronic picture books targeted largely to children. The
company offers over 1,000 titles from more than 70 different publishers, and holds the electronic
rights to thousands of additional titles. These books have been published under both the
“ibooks” and “ipicturebooks” imprints. Many of the books have been sold as print books by
various distributors and a large number are currently available as print books through Amazon.
“ipicturebooks” are also being distributed by several electronic book distributors, including
Amazon, Google Editions, For-Side Ltd., Lightning Source Digital, Overdrive (Content
Reserve), and Barnes & Noble’s Nook; in addition, plaintiffs are in negotiations with Barnes &
Noble for exclusive electronic distribution of certain of their titles via barnesandnoble.com (also

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available at and known as bn.com). The books are also available through various school and
library channels, such as the Follett Library Resources and the Online Computer Library Center
(“OCLC”).
20. Since its inception in 2002, “ipicturebooks” has become the largest provider of
children’s digital books to school districts and library systems. The books are frequently sold via
subscriptions to school districts and public libraries across the country. They are also available
on a direct-to-consumer basis and via distributors such as Amazon and ChildrensELibrary
(“CEL”). The “ipicturebooks” have a strong graphic component, and are thus well-suited to
electronic display and reading. Each “ipicturebook” bears the “ipicturebooks” name on the
copyright page. Annexed as Exhibit B is the copyright page of Coco’s Surprise, an electronic
version of a book originally published in Germany in 1998, showing the “ipicturebooks” imprint,
address and website.
21. The “ipicturebooks” library includes a large number of popular children’s books,
many of which were originally published as print books by other publishers. These books
include such titles as:
(1)

Various books in the Barney, Berenstein Bear and Shrek series;

(2)

Jane Goodall’s Animal World: Gorillas by Miriam Schlein;

(3)

There’s a Dragon About by Roni Schotter;

(4)

Dragonworld by Michael Reaves and Joseph Zucker;

(5)

“Not Now!” Said the Cow by Joanne Oppenheim; and

(6)

The Ultimate Dracula by Byron Preiss.

22. The “ipicturebooks” imprint is particularly well known for its numerous series of
children’s books. These series include:
(1)

The Mortimer’s Fun with Words series by Karen Bryant-Mole and Zul

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Mukhida;
(2)

The Mortimer’s Math series by Karen Bryant-Mole;

(3)

The 101 Facts about Pets series by Sarah Williams;

(4)

The Real Kids Readers series by Marcia Leonard and Dorothy Handelman;

(5)

The Blue Tortoise, Green Bear, Red Rhino and Yellow Hippo series by Alan
Rogers;

(6)

The I Wish I Were a . . . series by Ivan Bulloch and Diane James; and

(7)

The Zoo Animals series by Caroline Arnold and Richard Hewitt.

23. Other “ipicturebooks” are targeted to older schoolchildren and are frequently used in
classrooms as teaching aids. These books include titles such as:
(1)

A Caribou Journey by Debbie Miller and John Von Zyle;

(2)

My Life with the Chimpanzees by Jane Goodall;

(3)

Books about famous historical figures, such as Alexander the Great, Amelia
Earhart, Cleopatra, Thomas Edison, Henry Ford, Galileo, Gandhi and Pablo
Picasso;

(4)

Books about history, such as Ancient Rome, Saudi Arabia, the Time Machine
series, Instant European History and Instant English Literature; and

(5)

Books about recent historical leaders and events such as All American Boys:
An Insider’s Look at the U.S. Space Program; Civil Rights Leaders; and The
Last Souvenir: Okinawa.
THE “ibooks” AND “ipicturebooks” ELECTRONIC BOOKS

24. Preiss was a pioneer of electronic books, and foresaw their emergence and growth
long before other publishers. There were several components to Preiss’ electronic books
business. First, as set forth above, ipicturebooks LLC was formed for the very purpose of

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creating and selling children’s electronic picture books. During the company’s early stage,
“ipicturebooks” electronic books were promoted and sold by AOL and Microsoft. The books are
currently available from a number of electronic publishers including Amazon.com. Annexed as
Exhibit C are the first five pages of the more than 350 “ipicturebooks” currently available from
Amazon.
25. Second, Preiss produced electronic versions of most of the “ibooks” titles and sold
them as ebooks under the “ibooks” imprint. Initially, Preiss partnered with Microsoft in
connection with Microsoft’s launch of its ebooks “reader” software, and the books were
available from Microsoft.com. Over time they also became available from other electronic
sources, including Amazon.com, Palm.com, Overdrive.com, Fictionwise.com, Motricity.com
and LightningSource.com.
26. Third, one of the Preiss businesses was known as Byron Preiss Visual Publications,
Inc. (“BPVP”). This entity – the assets of which were also purchased by Colby – created
thousands of so-called “packaged” books under contract with other publishers. Preiss writers,
editors and illustrators would create a book for a publisher that would be sold under the
publisher’s own imprint, and under the name of the publisher’s “author”. These books include
children’s books, parenting books, textbooks, and books “authored” by celebrities. While print
versions of these books are sold under another publisher’s imprint, BPVP – not the various
publishers – holds the rights to the electronic versions of these books.
27. Unlike many competitors in the ebooks business, Preiss – and now plaintiffs – own
or license the electronic publication rights to virtually all of the books they publish
electronically. Acting largely through ipicturebooks LLC, Preiss purchased or licensed
electronic rights to thousands of mainstream books published by the major publishing
companies. Since 1999, Preiss published over 3,000 electronic titles; he also purchased or

12

licensed the electronic rights to thousands more. Today, these electronic rights are owned by
plaintiff Boylston. Over the years, “ipicturebooks” electronic books have been promoted and
sold through various distributors, including the ipicturebooks website (ipicturebooks.com),
which was active from approximately August 2000 to April 2008. Annexed as Exhibit D are
screenshots from the “ipicturebooks” website for April 8, 2001 and March 7, 2006.
28. Virtually all of the “ibooks” print books are available electronically. Like the print
versions of these books, the electronic versions are sold under the “ibooks” mark. In addition to
the titles referred to in paragraphs 15 through 18 above, plaintiffs also hold the electronic rights
to books by John Steinbeck (The Grapes of Wrath), Raymond Chandler (Philip Marlowe and
others), Arthur C. Clarke and Irving Wallace. Other titles available electronically under the
“ibooks” mark include Douglas Adams The Hitchhiker’s Guide to The Galaxy, a graphic novel
by John Carmell, and The Ultimate Einstein, by Robert Libbon.
29. In addition, thousands of well-known titles that originated with BPVP are now
owned by plaintiffs and are, or could be made available, electronically. These include:


Halloween, a children’s electronic Halloween book read by Jerry Seinfeld
and published by Little Brown;



Titles by various celebrity authors including Miles Davis, Paul Simon and
Joni Mitchell;



The Bank Street Library, Ready to Read series, a major source of
children’s readers, the print versions of which are sold by Reader’s Digest;
and



A series of art ebooks created by Preiss under an agreement with Scala
Group SpA.

13

30. Most of plaintiffs’ graphic novels are sold electronically under the “ibooks” imprint.
They include:


Volumes 1 and 2 of Dead Samurai, by Aron Lusen;



The Skeleton Family, by Anne Baraou and Vincent Sardon;



Swords of Rome, Volume 1: The Conquerors, by Jean DuFaux and
Philippe Delaby;



Magnus, Robot Fighter: Volume 1, by Louise Simonson and Jim Steranko;



Numerous volumes of The Terminator, by Russell Blackford;



The Best of Ray Bradbury, a collection of science fiction stories by this
famous author.



The three-volume collection of Mister X graphic novels by Dean Motler
and Paul Rivoche;



The three-volume collection of the highly popular European fantasy epic
series The Quest for Aberzen, by Marc N’Guessan and Christophe Gibelin;
and



Over ten titles from the Alfred Bester Library, including The Deceivers,
Psychoshop, The Stars My Destination and The Computer Connection.

PLAINTIFFS’ RIGHTS IN THE “ibooks” AND “ipicturebooks” MARKS
31. Throughout the past eleven years, plaintiffs and their predecessors have promoted
“ibooks” and “ipicturebooks” within the publishing industry. At least twelve “ibooks”
catalogues were published between September 2001 and December 2006. Each of these
catalogues contained hundreds of “ibooks” titles and many of them are more than 70 pages long.
Copies of the covers of these catalogues are annexed as Exhibit E. From 2007 to date, “ibooks”

14

have been listed in the catalogue of the company’s distributor, NBN. Attached as Exhibit F are
excerpts from the NBN catalogues for 2008, 2009 and 2010 showing portions of the “ibooks”
list. Attached as Exhibit G is the cover of a 2005 catalogue of “ibooks” graphic novels.
32. Plaintiffs and their predecessors have advertised “ibooks” and “ipicturebooks” from
time to time in both the publishing trade press and the mainstream press, and have also promoted
the books at publishing fairs held throughout the world. Attached as Exhibit H is an
announcement published in Publishers Weekly regarding “ibooks” acquisition of the entire
backlist of the well-known author Howard Fast. The “ibooks” graphic novels received
considerable publicity; annexed as Exhibit I are two announcements published in the trade press
about Preiss’ launch of various graphic novels, including novels featuring the legendary Harvey
Comics characters. From 2007 through 2010, the “ibooks” titles were listed in the Book Expo
America (“BEA”) catalogue issued in connection with the annual BEA publishing trade show.
Excerpts from this catalogue are attached as Exhibit J. In 2004, “ibooks” was named by
Publisher’s Weekly as one of the ten outstanding small publishers of the year.
33. Today, over 4,000 “ibooks” and “ipicturebooks” are available electronically. They
can be purchased from virtually all online booksellers, including Amazon, Barnes & Noble,
Follet, OCLC, Fictionwise, Overdrive, Sony, Lightning Source and For-Side, a Japanese
distributor of cell phone systems. The “ibooks” science fiction books, graphic novels and
electronic books are particularly popular with, and are well-known to, readers of books in those
genres. Amazon, for example, features reviews and reader comments on several of the “ibooks”
graphic novels on its website. Similarly, the “ipicturebooks” illustrated children’s books are
particularly popular with parents, children and children’s libraries. Plaintiffs, through their
“ibooks”, “ipicturebooks” and BPVP imprints, were pioneers in the electronic books field and
were known as such within the publishing industry.

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34. While ibooks, inc. was the first English language publisher to publish books
simultaneously in print and electronically, the “ibooks” mark used by plaintiffs does not and was
never intended to denote electronic, or internet-related, books. In fact, the “ibooks” logo, which
appears prominently in all the company’s catalogues, consists of the letter “i” inside a light bulb.
Although the “ibooks” name was initially used in connection with science fiction novels, it has
long been applied to numerous different genres of books, and thus does not describe any
particular genre of book or any characteristic of the books. Until Apple’s misappropriation of
the mark, “ibooks” was a unique and distinctive trademark that was used in connection with the
books published by plaintiffs and its predecessors, and hence served as a common law trademark
for said books. Similarly, “ipicturebooks” is a unique and distinctive trademark that serves as a
common law trademark for the illustrated children’s books sold by plaintiffs.
35. Until Apple’s launch of its iPad, no books other than plaintiffs’ had been associated
with the “ibooks” name. Plaintiff’s “ibooks” and “ipicturebooks” have enjoyed millions of
dollars in sales since their launch in 1999 and plaintiffs, Preiss and their distributors have
actively promoted the books within the publishing industry. The “ibooks” and “ipicturebooks”
marks have thus achieved secondary meaning within the publishing industry. The marks have
also achieved secondary meaning among readers of science fiction, graphic novels and school
and library electronic books, and have come to signify the print and electronic books published
by plaintiffs.
36. Plaintiff Boylston, via Colby’s purchase of the assets of the various Preiss entities, is
the owner of all right, title and interest in the “ibooks” and “ipicturebooks” trademarks. These
marks constitute an extremely valuable asset for Boylston. But for Apple’s appropriation of
“iBooks” for its own purposes, their value would increase exponentially given the advent of the

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new ebook readers, such as Amazon’s Kindle, Barnes & Noble’s Nook, Apple’s iPad and
Motorola’s XOOM.
37. As set forth below, Apple’s launch of its iPad tablet, with its heralded “iBooks”
application, was carried out in total disregard of plaintiffs’ rights in the “ibooks” mark, and in
total disregard of the economic consequences for plaintiffs’ mark in light of Apple’s massive
advertising and promotional expenditures. Despite Apple’s ten-year ownership of the mark
IBOOK for computers, and despite Apple’s sale for several years of an “iBook” portable
computer, Apple never protested plaintiffs’ use of the “ibooks” mark and never asserted that its
rights in the IBOOK mark extended to the sale of print or electronic books or to a means of
disseminating electronic books.
APPLE’S MISAPPROPRIATION OF PLAINTIFFS’ “ibooks” MARK
38. On April 3, 2010, Apple launched its iPad tablet computer. This launch was
preceded by an enormous amount of publicity. The iPad is comparable to the Amazon Kindle
reader and the Barnes & Noble Nook reader, but is programmed for a wide variety of
applications (“apps”), such as sending and viewing email, sending and viewing photos, playing
electronic games, and reading newspapers, magazines and electronic books. In the days
following the iPad’s launch, Apple took out full page ads in numerous publications, including
The New York Times and The Wall Street Journal announcing the product’s launch.
39. While Apple has encouraged software manufacturers to generate new apps for use in
connection with the iPad, and while several thousand apps are now available, one of the core
apps for which the iPad was designed was the reading of electronic books. Attached as Exhibit
K is a copy of a full page ad published in The New York Times on April 15, 2010; the ad depicts
the iPad being used to read an electronic book, in this case a Winnie-the- Pooh story. The
electronic library app is designated by the “iBooks” icon, which appears along the left-hand side

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of the iPad screen. Attached as Exhibit L is an ad from Apple’s website depicting the “iBooks”
and other icons for the various apps available on iPad. The “iBooks” app, although not the
individual “iBooks” themselves, can be downloaded free of charge.
40. When an iPad user taps the “iBooks” icon, Apple’s “iBookstore” appears on the
screen. The iBookstore is a virtual library, and is portrayed by the display of book covers on a
library shelf. Until recently, each view of the iBookstore shelf bore the heading “iBooks”.
Annexed as Exhibit M is a screenshot of the virtual bookshelf showing the name “iBooks” at the
top as well as covers of all of the “iBooks” that have been downloaded. During the iPad’s first
day on the market, users downloaded over 250,000 “iBooks”; during its first two weeks on the
market, users downloaded more than 600,000 “iBooks”. According to Apple, consumers have
downloaded more than 100 million “iBooks” during the first ten months the iPad has been on the
market.
41. In or about July 2010, Apple made “iBooks” available to users of its iPhone. Like
iPad users, iPhone users click onto an “iBooks” icon and view a virtual library consisting of
book covers arranged on a library shelf. And until recently, each view of the shelf bore the
heading “iBooks”. Annexed as Exhibit N is a screenshot of the iPhone virtual bookshelf
showing the name “iBooks” at the top as well as covers of the individual “iBooks” that have
been downloaded. More recently, Apple made “iBooks” available to consumers through its
iTunes store. Annexed as Exhibit O is a screenshot of the iTunes store (accessed via the iPhone)
showing the availability of “iBooks”. Upon information and belief, “iBooks” are also available
to users of Apple’s iPod Touch device and its MacBook laptop computer.
42. In mid-December, 2010, Apple launched an upgraded version of its “iBooks” app.
In this new version, Apple attempted to create an artificial distinction between the underlying
“iBooks” and the app by which they are delivered to consumers; thus Apple replaced the word

18

“iBooks”, which previously appeared at the top of the user’s virtual library, with the word
“Books”. Some iPad and iPhone users will continue to use the original “iBooks” software and
thus will still see the word “iBooks” at the top of their “iBookstore” bookshelf. However,
because the software upgrade is free, over time most iPad and iPhone users will install it and thus
will see “Books” rather than “iBooks” at the top of their virtual bookshelf. Nevertheless, during
the ten months that the iPad has been on the market, Apple has established “iBooks” as the name
for the electronic books available via the iPad and other Apple devices as well as the system by
which these books are delivered to consumers. Indeed, the announcement of the software
upgrade depicted in Exhibit P features the display of an open book next to the words “iBooks”
and “Apple” – demonstrating that “iBooks” is now synonymous with electronic books available
from Apple. Similarly, in a commercial for its iPhone that was broadcast repeatedly during the
televised NCAA basketball tournament, Apple claims that “If you don’t have an iPhone, you
don’t have iBooks, so you don’t have your favorite books in your pocket . . . .”
43. While Apple owns a valid registration for IBOOK for computers, and while it once
sold a portable computer under the iBook name, it is not using the “iBooks” mark to describe
either the iPad or iPhone computer devices. Rather, Apple is using “iBooks” to describe the
electronic library available on the iPad and iPhone as well as the underlying books that constitute
that library. As of mid-December 2010, every iPad and iPhone user who had downloaded a book
onto their iPad or iPhone had that book pictured in a bookshelf display entitled “iBooks”. As the
user added more books to the collection, each subsequent bookshelf bore the “iBooks” label for
the newly added books. While the bookshelf no longer displays the word “iBooks”, the books
themselves remain accessible only via an app entitled “iBooks”.
44. Since Apple’s launch of the iPad, consumers, bloggers and the media have come to
view “iBooks” as not only the name of Apple’s electronic library app but also the designation for

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the underlying books available via the iPad and iPhone. Descriptions of the underlying books as
“iBooks” have appeared in, inter alia, Computer Weekly News (May 6, 2010); Penton Insight
(May 10, 2010); Canberra Times (May 11, 2010); The Arizona Republic (May 16, 2010); The
Wall Street Journal (May 27, 2010); CNET.com (June 2, 2010); Chicago Sun-Times (December
10, 2010); Wired.com (January 13, 2011); and Wikipedia (March 10, 2011).
45. Numerous comments posted on Apple’s own discussion boards show that iPad users
refer to the books in Apple’s electronic library as “iBooks”. In fact, Apple itself recommends
that iPad users utilize a book entitled “iPad: The Missing Manual”. This book, which serves as
an introduction to the many features and functions of the iPad, was authored by J.D. Biersdorfer,
who writes on computer issues for, inter alia, The New York Times. This book contains a chapter
entitled “iBooks & ePeriodicals”, and covers such topics as “Find Free iBooks”, “Read an
iBook”, “Search an iBook” and “Delete an iBook” (see the excerpt annexed as Exhibit Q).
Similar references can be found in statements by Apple itself, including statements on its iPad
and iTunes websites and a statement by Apple’s CEO Steve Jobs in a Time magazine cover story
on April 12, 2010. Accordingly, while “ibooks” previously connoted a line of books sold by
plaintiffs, Apple has turned it into the name of its electronic library, denoting both the underlying
books in that library as well as the means by which these books can be accessed through the use
of Apple’s iPad, iPhone and other devices.
46. In recent months Apple has substantially enhanced both its iPad product and its
“iBooks” franchise. On March 3, 2011, Apple introduced its iPad 2, an upgraded version of the
original iPad tablet. At the launch ceremony for the iPad 2, Apple announced that it had sold
14.8 million iPads globally as of December 31, 2010, and that those sales had generated $9.5
billion in revenue. Apple also boasted that it had become a major force in the publishing world,
that 2500 book publishers were now selling their books through Apple’s iBookstore, and that

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more than 100 million books had been downloaded via the “iBooks’ app.
47. A day earlier, Apple also announced that it had added Random House, the world’s
largest book publisher, to its “iBooks” app. Random House joined other major publishers –
including HarperCollins, Penguin, Macmillan and Simon & Schuster – in selling their imprints
electronically via the “iBooks” app. This development was discussed in articles published on
February 28th and March 2nd in Apple Insider, a blog that carries up-to-the-minute articles about
Apple and that is widely followed by users of Apple products. In the February 28th article
(Exhibit R) about the imminent Random House deal, Apple Insider displayed a picture of the
iPad tablet being used to read an “iBook” together with a picture of the iBookstore bookshelf.
This picture continues to show the name “iBooks” at the top of the bookshelf, and further
reinforces the fact that the public understands that “iBooks” is the name for the books available
electronically via Apple’s iPad and iPhone.
APPLE’S EXPANSION OF ITS “ibooks” BRAND
48. On or about January 19, 2012, Apple announced the launch of “iBooks 2”. “IBooks
2” is a digital bookstore for the delivery of electronic textbooks designed for use in school
classrooms. These electronic textbooks include interactive materials such as embedded videos,
multiple-choice questions that can be answered via text on the screen and diagrams that can be
changed via touching the screen. The initial textbooks sold via “iBooks 2” are high school texts
from publishers such as McGraw-Hill and Houghton Mifflin Harcourt. Upon information and
belief, Apple plans to expand its “iBooks 2” platform to the elementary school market.
49. Apple’s “iBooks 2” books are directly competitive with many of the schoolbooks
sold under plaintiffs’ ipicturebooks and ibooks imprints. This competition will be even greater
once Apple begins providing grade school textbooks via its “iBooks 2” platform. As stated
above, most of plaintiffs’ ipicturebooks are sold as electronic books, and they are widely

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available through various schools, school districts and libraries. Apple’s entry into the
schoolbook market under the “iBooks” brand will overwhelm plaintiff’s use of the ibooks and
ipicturebooks marks as marks for books targeted to school children and teenage students.
50. On or about January 19, 2012, Apple announced the launch of “iBooks Author”.
“iBooks Author” is an e-books authoring application which permits authors to create and publish
their own electronic books, including “Multi-Touch textbooks,” and make them available for
sale. See iBooks Author, Apple.com (accessed May 8, 2012), http://www.apple.com/ibooksauthor/. “iBooks Author” allows authors to make use of templates and functions to create
finished, packaged books, and “[w]hen it’s just the way you want and you’re ready to publish,
iBooks Author helps you submit to the iBookstore for purchase”. Id.
51. Apple’s “iBooks Author” application is directly competitive with Plaintiffs in the
market for electronic textbook publishing, authorial talent and book packaging services. For
example, in the market for authors of electronic books, Apple’s “iBooks Author” application
competes with the publishing services offered by Plaintiffs to potential authors under the ibooks
and ipicturebooks marks. For the reasons set forth above, the focus on “Multi-Touch textbooks”
in Apple’s marketing of “iBooks Author” also competes with Plaintiffs’ publishing under the
ibooks and ipicturebooks marks in the schoolbook and textbook markets. In addition, as stated
above, Plaintiffs hold the electronic book rights to thousands of books which they have packaged
for other publishers. Thus, Apple’s entry into the electronic book publishing market, under the
name “iBooks Author,” will overwhelm Plaintiffs’ use of the ibooks and ipicturebooks marks in
the market for authorial talent and packaging of electronic books and textbooks.
APPLE’S PURPORTED EXPANSION OF ITS “ibooks” TRADEMARK
52. On or about April 7, 2010, subsequent to its purported acquisition of the Family
Systems IBOOK mark and just prior to its amendment of that mark to cover the plural version of

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the mark (viz., “IBOOKS”), Apple filed a new application to register the trademark “IBOOKS”
in the U.S. Patent and Trademark Office (“PTO”). This application (Serial No. 85008412) seeks
to register the mark “IBOOKS” on a wide range of goods and services related to electronic
books. The application seeks to register “IBOOKS” for, inter alia, the following goods:
Class 009: “downloadable electronic publications in the nature of
books, plays, pamphlets, brochures, newsletters, journals,
magazines and periodicals on a wide range of topics of general
interest.”
Class 016: “Periodicals, books, magazines, newsletters, brochures,
booklets, pamphlets, manuals, journals, and leaflets on a wide
range of topics of general interest.”
53. On or about June 29, 2010, the PTO denied this application on the ground that
“IBOOKS” is “merely descriptive” of the features and functions of the goods and services in
question, i.e., producing internet related reading materials. As the Trademark Examiner stated:
“[T]he applicant uses or intends to use the proposed mark on a
variety of books and other publications, electronic publications,
and services relating to the sale and provision of electronic
publications. It is likely the applicant’s publications are provided
and sold via the internet . . . . Accordingly, the wording in the
mark is merely descriptive . . . .”
54. On or about December 29, 2010, Apple filed a voluminous “Response to Office
Action” in which it argued that the Trademark Examiner was wrong and that the “IBOOKS”
mark was not “merely descriptive”. Apple argued that “IBOOKS is a member of Apple’s family
of famous marks that begin with the prefix ‘i’, and is a direct descendant of one of the original
marks in this family, the IBOOK mark.” Apple pointed out that it holds over 60 active federal
applications and registrations for marks beginning with the prefix “i” and that:
“[I]n light of Apple’s longtime identification with the IBOOK
mark, and its use of other famous “i”-prefix brands, consumers
immediately recognize IBOOKS as a member of Apple’s
family of marks.”
55. Action on this application was suspended by the PTO during 2011. On or about

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February 22, 2012, Apple filed a formal “Response to Suspension Inquiry”. In that Response,
Apple withdrew its reliance on certain foreign applications relating to this mark, but otherwise
maintained that the mark was entitled to registrations. In this filing, Apple reattached its
“Response to Office Action” that it had filed in December 2010 and urged the Trademark
Examiner to reconsider the decision that the mark is “merely descriptive”. This application
remains alive and pending in the PTO.
56. On or about March 6, 2012, Plaintiffs’ counsel in this action emailed an earlier
proposed draft of this Amended and Supplemental Complaint to Apple’s counsel, and indicated
that Plaintiffs intended to add allegations arising from Apple’s April 7, 2010 “iBooks” trademark
application. For example, Plaintiffs could argue that Plaintiffs’ allegations of reverse confusion
and infringement are supported by the fact that Apple’s own application included “periodicals,
books, magazines, newsletters, brochures, booklets, pamphlets, manuals, journals and leaflets on
a wide range of topics of general interest” and “downloadable electronic publications in the
nature of books” in the list of goods and services covered by the “iBooks” mark.
57. On March 13, 2012, approximately one week after Apple’s counsel in this action
received that proposed draft Amended and Supplemental Complaint, Apple filed a
Trademark/Service Mark Amendment to Allege Use form (the “Amendment Form”) with the
PTO. The Amendment Form sought to delete permanently from the allegation of use contained
in Apple’s April 7, 2010 “iBooks” application “periodicals, books, magazines, newsletters,
brochures, booklets, pamphlets, manuals, journals, and leaflets on a wide range of topics of
general interest” and “downloadable electronic publications in the nature of books,” among other
classes, from the list of goods and services covered by Apple’s “iBook” mark.

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APPLE’S ACQUIESENCE, ESTOPPEL AND LACHES
REGARDING PLAINTIFFS’ “ibooks” AND “ipicturebooks” RIGHTS
58. On November 5, 1998, Apple filed an application to register its original IBOOK
mark with the PTO. The application was filed as an Intent-to-Use (“ITU”) application under 15
U.S.C. § 1051(1)(b)(1), and was for use in connection with “computers, computer hardware,
computer peripherals and users manuals sold therewith” in Class 9. Approximately two years
earlier, on October 8, 1996, Family Systems, Ltd., a U.K. company, had filed a similar ITU
application for the identical mark for use in connection with “computer hardware and software
used to support and create interactive, user-modifiable electronic books”. This application was
also for goods in Class 9.
59. On or about June 23, 1999, the PTO suspended prosecution of Apple’s application
due to the prior application filed by Family Systems, for which a Notice of Allowance had been
issued. On or about July 28, 1999, Apple filed a response to the PTO’s suspension, entitled
“Response to Office Action”. This Response consisted of a Consent Agreement (the
“Agreement”) dated as of May 7, 1999, between Apple and Family Systems whereby the
companies agreed on conditions surrounding their respective use of the IBOOK mark.
Specifically, Apple and Family Systems agreed, that:
(1) Apple’s use of the mark would be confined to computer hardware, namely
“notebook computers”;
(2) Family Systems’ use of the mark would be confined to computer hardware
and software “used to support and create interactive, user-modifiable
electronic books”; and
(3) Apple’s stylization of the mark would be limited to either (i) “iBook” or (ii)
“iBOOK”.
60. The Agreement further provided that, so long as its terms were adhered to, there
would be no likelihood of confusion between the parties’ respective marks and products. Thus
paragraph 9 of the Agreement states that:

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“The parties agree that their respective products and
services, as defined in Paragraph 1 and 2 of this
Agreement, are distinctly different and, if used in
accordance with this Agreement, the parties’ use of
their respective IBOOK marks are not likely to
create a likelihood of confusion. Should actual
confusion arise between the parties’ use of their
respective marks, the parties agree to cooperate and
find ways to eliminate or further reduce the
likelihood of confusion.”
61. Apple and Family Systems also agreed in paragraph 7 that each would notify the
other “of any violation of rights pertaining to the IBOOK marks that comes to such party’s
attention and which such party deems to be a violation of one or both of the parties’ rights in
their respective IBOOK marks”. A copy of this Agreement is annexed as Exhibit S.
62. Based on the Consent Agreement, the PTO concluded that Apple’s IBOOK mark
was entitled to registration and issued a Notice of Allowance. On July 17, 2001, the PTO issued
a Certificate of Registration. The PTO had previously issued a Certificate of Registration for
Family Systems’ IBOOK mark on April 24, 2001.
63. This Consent Agreement was crucial to Apple’s ability to register its IBOOK mark.
Under that Agreement, Apple’s IBOOK registration is limited to “computers, computer
hardware, computer peripherals and users manuals sold therewith” while the Family Systems
registration is limited to “computer hardware and software used to support and create interactive,
user-modifiable electronic books”. Apple could not have obtained registration of its IBOOK
mark but for this Agreement, which acknowledged that Apple’s sale of computers and Family
Systems’ sale of computer software used in connection with electronic books were “distinctly
different” products and services and “were not likely to create a likelihood of confusion” despite
their use of the identical IBOOK trademark.
64. In or about July 1999, Apple introduced a new portable computer under the name

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iBook. The product was advertised and promoted as a portable electronic “notebook”. In or
about January 2002, Apple introduced an updated version of this product under the name
“MacBook”. Although Apple continued to sell a small number of iBook computers, from early
2002 to date its advertising and promotion has been directed almost exclusively to the MacBook.
65. During the thirteen years since Apple’s iBook computer was first sold, Apple has
never protested or otherwise contested Preiss or plaintiffs’ use of the “ibooks” mark. Nor, upon
information and belief, did Apple or Family Systems ever notify the other that the use of the
“ibooks” mark by plaintiffs and Preiss infringed either party’s rights in their respective IBOOK
registrations. Apple has therefore acquiesced in plaintiffs’ use of the “ibooks” mark and has
acknowledged that said mark does not infringe Apple’s rights in its IBOOK mark for computers.
Apple is therefore barred by acquiescence, laches and estoppel from contesting plaintiffs’ rights
in their “ibooks” mark for the sale of print and electronic books.
THE FAMILY SYSTEMS IBOOK MARK
66. On April 24, 2001, Family System obtained its IBOOK registration. As noted above,
this registration covered computer software “used to support and create interactive, usermodifiable electronic books”.
67. Family Systems is a small UK corporation founded by two investors/entrepreneurs
who own, and assigned to Family Systems, a patent for “an interactive Web book (“ibook”)
system . . . that allows materials to be contributed to the world wide web.” The patent further
states that users may “enroll” in the ibook system “as viewers or contributors” and that
contributors “may contribute original material to the ibook or may create derivations of existing
ibook material.” The founder of Family Systems has explained on his website that “our vision
was that innovation would occur on the pages of our interactive web site”.
68. According to a “Statement of Use” filed by Family Systems in the PTO in November

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2000, the company commenced using the IBOOK mark by “at least” October 27, 2000. And
according to a “Combined Declaration of Use and Incontestability” filed by Family Systems in
the PTO in April 2007, the company used the mark continuously since the date of registration as
a trademark for “software used to support and create interactive, user-modifiable electronic
books”.
69. Archived materials from the website for ibook.com show that Family Systems did in
fact use the IBOOK mark continuously from about March 2000 through December 2007, the last
date for which archival records are available. Upon information and belief, this usage continued
throughout 2008, 2009 and January of 2010. Throughout this ten-year period, Family Systems
used the IBOOK mark precisely as it was described in both the U.S. trademark registration and
the U.S. patent application: to identify a software system that allows users to create, modify,
view, critique and comment on interactive electronic books.
70. The IBOOK interactive ebook system promoted by Family Systems had nothing to
do with the reading of traditional published books. Rather, it was a user-based system that
allowed subscribers to create a wide range of interactive electronic “book” products, from webbased blogs and diaries to personal audio recorders to web page controllers and file sharing
devices. An IBOOK screenshot from December 23, 2002, is annexed as Exhibit T; this
screenshot provides a description of the various IBOOK products and uses.
71. One example of a typical interactive book that was created via the IBOOK system
appeared on the ibook.com website in 1999 and is attached as Exhibit U. Entitled “Vikram’s
Travels”, it is a travel journal created by contributor Vikram Singh documenting his travels
through the world, including recent visits to India and Sri Lanka. The Vikram’s Travels IBOOK
was available on the ibook website for several years. Another example of an interactive book
appeared, via a link to the ibook.com website, on February 3, 2001 (Exhibit V); this link displays

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a “welcome to my world” message from a person identified as Stewart Barr, and provides space
for entries about various aspects of Mr. Barr’s life.
72. Throughout the ten years that Family Systems used the IBOOK mark, the underlying
IBOOK product was the availability of an internet platform on which subscribers could create
their own interactive electronic book products. Annexed as Exhibit W are IBOOK screenshots
from January 25, 2001, November 27, 2001 and September 30, 2005. Like typical IBOOK pages
throughout this ten-year period, these pages encourage users to enroll in “the Ibook of your
choice”, “install the Ibook Controller” (software package) and add to or comment on an existing
Ibook or use the “Ibook Server” to create a new Ibook.
APPLE’S FRAUDULENT PURCHASE, USE,
AMENDMENT AND RENEWAL
OF THE FAMILY SYSTEMS MARK
73. In late January or early February of 2010, approximately two months prior to its
launch of the iPad, Apple entered into an agreement with Family Systems whereby it purportedly
purchased the Family Systems’ IBOOK mark. This transaction is reflected, inter alia, in a notice
Apple filed with the PTO on February 5, 2010, withdrawing Family Systems’ attorney as the
attorney of record for the Family Systems IBOOK mark and appointing Apple’s in-house
trademark counsel as the new attorney of record for that mark. Upon information and belief, the
documents relating to this transaction recite that Apple purchased the Family Systems’ IBOOK
mark and the good will attached to the mark.
74. Apple has not, however, continued to sell or promote the underlying Family Systems
IBOOK product nor has it used the underlying technology previously utilized by Family
Systems. Nor has Apple in any way utilized the good will developed by Family Systems in
connection with its ten years of operating its IBOOK system. Instead, Apple has merely taken
the Family Systems IBOOK mark and put it on a completely different product: the app that

29

signifies the library of traditional print books that are now available electronically to iPad and
iPhone users, as well as the underlying books themselves. Apple has therefore divorced the
Family Systems IBOOK mark from its underlying product and good will. Apple’s purported
purchase of the Family Systems mark is thus invalid as an assignment in gross, and it gives
Apple no rights in the mark vis-à-vis third parties such as plaintiffs. Even if Apple’s purchase of
the mark is not per se invalid, the purchase is ineffective for purposes of transferring Family
Systems’ trademark priority to Apple, and thus Apple may not rely on Family Systems’ prior
rights in the IBOOK mark.
75. Apple has also committed fraud on the PTO with respect to the Family Systems
IBOOK mark. On May 17, 2010, less than a week after receiving a copy of a draft complaint in
this action, Apple filed a purported “Amendment” to this registration to add an “s” to the mark so
that the registration now covers the word “IBOOKS”. In its “Section 7 Request Form” submitted
to the PTO in support of this Amendment, Apple declared under penalty of perjury that:
“The proposed amendment to the mark does not
render it sufficiently different to require
republication. The new form of the mark has the
same meaning as, and contains the essence of, the
original mark. The addition of “S” – changing the
mark from IBOOK to IBOOKS – creates the
impression of being essentially the same mark, so
that consumers will readily understand the mark to
be [the] same.”
A copy of this PTO filing is annexed as Exhibit X.
76. This statement was materially false and misleading and was known to Apple to be
false and misleading. The original registration – IBOOK – was used by Family Systems to
describe its software system, which was a web-based system that allowed users to create
interactive books and/or participate in interactive books generated by other users. Apple,
however, is using the plural form of the mark – IBOOKS – to designate the app by which the

30

library of traditional print books are now available electronically via the iPad and iPhone, as well
as the underlying books themselves. As a result, Apple’s statements that the new mark was not
“sufficiently different” from the original mark so as to require republication, and that the new
form of the mark has the “same meaning” and “contains the essence of” the original mark, were
materially false and were known by Apple to be materially false.
77. While Apple is using the IBOOKS mark to refer, inter alia, to the software app that
allows iPad and iPhone users to access the iBooks electronic library, that software app is
materially different from the software system that Family Systems utilized to allow its customers
to generate interactive, user-modifiable ebooks. As a result, Apple is using the amended form of
the Family Systems mark in a way that gives it a totally different meaning from the original
version of the mark and in a way that makes no connection between the Family System product
and good will and the Apple product and good will in the minds of consumers. Apple’s sworn
representations to the PTO in its Section 7 Request were materially false and misleading and
were made in an effort to induce the PTO to issue an amend registration covering the mark
“IBOOKS”. On April 24, 2010, as a result of Apple’s materially misleading statements, the PTO
proceeded to issue the amended registration requested by Apple.
78. On June 6, 2010, Apple committed a further fraud on the PTO. On that date it filed a
Combined “Declaration of Use” of the IBOOKS mark under § 8 of the Lanham Act and a
“Renewal of Registration” for that mark under § 9 of the Lanham Act (Exhibit Y). Apple
attached to this application a screenshot of its “iBooks” bookshelf that can be accessed through
the iPad. This filing was necessary in order to support the amended version of the mark
(IBOOKS) and to obtain the renewal of the original registration of the mark, which was
scheduled to expire in April 2011. Nowhere in this application did Apple disclose that the
“iBooks” mark that it was using in connection with its iPad and iPhone was materially different

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from the IBOOK mark previously utilized by Family Systems and that Apple was not utilizing
the good will of the Family Systems IBOOK product and mark in connection with its new
“iBooks” product and mark. On June 14, 2010, in reliance of Apple’s filing, the PTO notified
Apple of its acceptance of the Declaration of Use and the renewal of the registration.
79. Upon information and belief, Apple’s misleading PTO findings were motivated, at
least in part, by Apple’s attempt to exploit the Family Systems mark for purposes of the dispute
herein. By the time of these two PTO filings, Apple was well aware of plaintiffs’ claims
regarding their rights in the “ibooks” mark for books. Moreover, the Apple attorneys involved in
these fraudulent PTO submissions were well aware that Apple was defending against plaintiffs’
claim of trademark infringement on the basis of its rights in the recently purchased Family
Systems IBOOK mark.
80. Apple and its attorneys were fully aware that the statements they made to the PTO in
connection with the May 17, 2010 and June 6, 2010 filings were false and misleading, that Apple
was not utilizing the good will of the Family Systems IBOOK mark in connection with its own
“iBooks” products, and that its purported purchase of the Family Systems IBOOK mark was null
and void as against anyone other than Family Systems.
THE LIKELIHOOD OF CONFUSION AND PLAINTIFFS’ INJURY
81. The introduction, sale and use of Apple’s new iPad has been a subject of enormous
advertising and promotion by Apple, and enormous coverage by the mainstream news media, the
financial press and countless writers and bloggers. During its first two weeks on the market,
Apple took out almost daily full-page ads in newspapers such as The New York Times and The
Wall Street Journal. The product has been so successful that Apple’s executives have been
quoted as saying that they were “shocked” by the high level of demand for the product.
82. The iPad, coming on the heels of Amazon’s Kindle and Barnes & Noble’s Nook, is

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revolutionizing the way books are sold and read. More than three weeks prior to iPad’s launch,
five of the country’s six largest publishers had already reached arrangements to sell their books
electronically through Apple’s “iBooks” bookstore. Moreover, Apple’s “iBooks” library is now
accessible to iPhone users, who can purchase, store and read “iBooks” on their iPhone screen,
and to iTunes and iPod Touch users. Virtually overnight, the “ibooks” mark previously
associated with plaintiffs has been transformed into a mark associated with Apple’s “iBooks”
electronic library.
83. Until Apple commenced using plaintiffs’ “ibooks” mark, plaintiffs were wellpositioned to take advantage of the emergence of electronic books as a way to vastly expand
their “ibooks” and “ipicturebooks” franchise. Sales of electronic books exploded in 2010 and
reached just under $1 billion by the end of the year; furthermore, the industry projects that ebook sales will reach $2.8 billion by 2015. As noted above, plaintiffs’ predecessor Preiss was a
pioneer in the e-book field; as a result, most of plaintiffs’ “ibooks” titles are available
electronically and thousands more are available under the “ipicturebooks” and BPVP imprints.
84. Plaintiffs’ ability to exploit their “ibooks” and “ipicturebooks” marks in the
electronic book market has been doomed by Apple’s enormous success with “iBooks” and its
impending success with “iBooks 2”. Apple has spent tens of millions of dollars promoting the
iPad and its “iBooks” feature, as well as lesser amounts promoting the “iBooks” feature on its
iPhone. In the fourth quarter of 2010 alone, consumers purchased 7.3 million iPads and 16.2
million iPhones. With total e-book industry sales of just under $1 billion in 2010, Apple’s
approximately 25% share of those sales amounts to $250 million sales of “iBooks”.
85. Apple’s use of the “iBooks” and “iBooks 2” marks in connection with the
advertising, marketing, sale and use of its iPad, iPhone and other devices has effectively preempted plaintiffs’ ability to exploit its “ibooks” and “ipicturebooks” marks in the electronic book

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filed. The name “iBooks” is now forever linked with Apple. There is no way that plaintiffs
could even attempt to counteract the view among consumers that “iBooks” belong to, and are
associated with, Apple.
86. Apple’s vast “iBooks” marketing effort has also substantially damaged plaintiffs’
ability to exploit their “ipicturebooks” mark. As noted above, plaintiffs’ “ipicturebooks” imprint
is devoted primarily to the production and sale of electronic, picture-oriented books for children.
Yet Apple has recently begun an “iBooks” promotion for “Children’s Picture Books”. A recent
screenshot from Apple’s iBookstore (Exhibit Z) features electronic versions of numerous
favorite picture books for young readers; these “iBooks” “Children’s Picture Books” are
comparable to the vast collection of children’s picture books sold by plaintiffs as
“ipicturebooks”.
87. Apple’s use of the “iBooks” and “iBooks 2” marks in connection with the
advertising, marketing, sale and delivery of electronic books, as well as its use of the “iBooks”
mark in connection with its publishing application “iBooks Author,” is likely to cause reverse
confusion with plaintiffs’ “ibooks” and “ipicturebooks” print and electronic books, and has led to
the virtual destruction of the value of those marks. As a result of Apple’s wrongful appropriation
of the “ibooks” mark as an Apple brand, consumers are likely to be confused into believing that
plaintiffs’ “ibooks” and “ipicturebooks” are merely part of the electronic books available from
Apple, or that “ibooks” and “ipicturebooks” are otherwise associated with Apple, or that
“ibooks” is merely the generic name for electronic books available from Apple. Apple’s use of
the “iBooks” and “iBooks 2” marks in connection with its iPad, iPhone and other devices is
without the consent or approval of plaintiffs and is likely to cause irreparable injury for which
plaintiffs have no adequate remedy at law.

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APPLE’S WILLFUL TRADEMARK INFRINGEMENT
88. Apple launched its “iBooks” app, its “iBooks” library and its “iBookstore” in total
disregard of plaintiffs’ rights in the “ibooks” mark and in total disregard of the impact its actions
would have on the value of plaintiff’s mark. At the time Apple launched the iPad, it knew or
should have known of plaintiffs’ rights in the “ibooks” mark. For example, a simple internet
search of “ibooks” would have readily turned up plaintiffs’ “ibooks” imprint. Similarly, a search
of publishing industry records would have turned up the “ibooks” imprint. Likewise, a search of
the PTO files would have turned up an application by Preiss to register the “ibooks” mark for
books as well as the fact that the PTO advised Preiss that this application would be denied based
on the Family Systems IBOOK registration.
89. Moreover, Apple has had actual knowledge of plaintiffs’ rights since on or about
May 13, 2010, when it received a copy of the draft complaint in this action. Since that date,
Apple has expanded its use of plaintiffs ibooks mark, such as by adding “iBooks” as an app on
its iPhone, iTunes and iPad Touch products, launching an upgraded version of its iPad, and
arranging for the world’s largest publisher to publish its books as “iBooks” via the “iBooks” app.
Moreover, after receiving notice of plaintiffs’ claims in this matter, Apple attempted to procure
registration of the mark “IBOOKS” by filing the false and misleading PTO documents discussed
in paragraphs 73 through 80 above. And, as previously noted, in mid-December Apple
attempted to ameliorate the consequences of its wrongful use of plaintiffs’ “ibooks” mark by
creating an artificial distinction between the “iBooks” electronic library delivery system and the
underlying books in that library, which Apple now calls “Books” rather than “iBooks”.
Similarly, in its March 13, 2012 submission to the PTO amending its “iBooks” trademark
application, Apple attempted to disclaim the indelible association between “iBooks” and “books”
and “electronic books” by seeking to delete those classes of goods, which had previously been

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included in its trademark application. Not only are these actions of no consequence in light of
the vast consumer recognition that “iBooks” is the name for electronic books available from
Apple, but they also demonstrate Apple’s recognition that it is wrongfully using plaintiffs’
“ibooks” mark in connection with its iBookstore library.
APPLE’S PATTERN OF
WILLFUL TRADEMARK INFRINGEMENT
90. This is not the first time that Apple has knowingly and willfully infringed another
company’s trademark. For example, Apple did not own the mark “iPhone” before it publicly
announced the launch of its new “iPhone” device. Cisco Systems, Inc. was the owner of that
mark. Despite the fact that Apple had been in discussions with Cisco to license its registered
“iPhone” trademark, Apple ultimately ignored Cisco’s intellectual property rights and publicly
announced, without Cisco’s permission, Apple’s new “iPhone” at a widely publicized press
conference.
91. Additionally, Apple filed a trademark application for the mark “iPhone” in a foreign
country (Australia), in an effort to claim priority for the mark in the United States. As a result of
Apple’s conduct, on January 10, 2007, Cisco sued Apple for trademark infringement.
92. Similarly, Apple also rolled out the “iPad” product before attempting to license or
obtain assignment of the “iPad” mark from Fujitsu Frontech North America, Inc., which had an
application for the mark pending with the PTO.
93. Similarly, in April 2010, Apple announced at a press conference its launch of “iAd”,
an advertising platform that is available as an app on its iPhone, iTunes and iPad. This
announcement was made despite the fact that Innovate Media Group, LLC held a federal
trademark registration for the mark “iAds” for use in connection with online video advertising.
As a result of Apple’s misappropriation of the iAds mark, Innovate Media sued Apple for

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trademark infringement.
94. Similarly, in early June 2011, Apple launched a telecommunications, music and data
storage system under the name iCloud. In doing so, it ignored the fact that ICloud
Communications LLC offered various electronic storages services and had been utilizing the
name “ICloud” since 2005. As a result of Apple’s misappropriation of the iCloud mark, ICloud
Communication sued Apple for trademark infringement.
AS AND FOR A FIRST CLAIM FOR RELIEF
95. Plaintiffs repeat and reallege the allegations in paragraphs 1 through 94 with the
same force and effect as if fully set forth herein.
96. Apple’s use of the mark “iBooks” as set forth herein constitutes false designation of
origin in violation of § 43(a)(i)(A) of the Lanham Act, 15 U.S.C. § 1125(a)(i)(A).
AS AND FOR A SECOND CLAIM FOR RELIEF
97. Plaintiffs repeat and reallege the allegations in paragraphs 1 through 94 with the
same force and effect as if fully set forth herein.
98. Apple’s use of the mark “iBooks” as set forth herein constitutes infringement of
plaintiffs’ common law trademark “ibooks” and unfair competition under the Common Law of
New York.
AS AND FOR A THIRD CLAIM FOR RELIEF
99. Plaintiffs repeat and reallege the allegations in paragraphs 1 through 94 with the
same force and effect as if fully set forth herein.
100. Apple’s use of the mark “iBooks” as set forth herein constitutes wrongful
misappropriation in violation of the common law of New York.
AS AND FOR A FOURTH CLAIM FOR RELIEF
101. Plaintiffs repeat and reallege the allegations in paragraphs 1 through 94 with the

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same force and effect as if fully set forth herein.
102. Apple’s use of the mark “iBooks” as set forth herein constitutes unjust enrichment at
plaintiffs’ expense, in violation of the common law of New York.
AS AND FOR A FIFTH CLAIM FOR RELIEF
103. Plaintiffs repeat and reallege the allegations in paragraphs 1 through 94 with the
same force and effect as if fully set forth herein.
104. Apple’s use of the mark “iBooks” as set forth herein constitutes conversion in
violation of the common law of New York.
PRAYER FOR RELIEF
WHEREFORE, Plaintiffs demand judgment against Defendant as follows:
(1)

For permanent injunctive relief enjoining Apple from using the term “iBooks”,

“iBooks 2” or any variations thereof, to denote the electronic library, the electronic bookstore
app and the underlying electronic books available via its iPad, iPhone and other devices and
products;
(2)

For a declaration that Apple’s purchase of the Family Systems IBOOK mark was

an invalid assignment in gross, and gives Apple no rights in the Family Systems mark vis-à-vis
plaintiffs or other third parties or, alternatively, that the purchase was ineffective for purposes of
transferring Family Systems’ trademark priority to Apple;
(3)

For a declaration that Apple’s May 17, 2010 and June 29, 2010 filings in the PTO

were fraudulent, misleading and deceptive and constitute inequitable conduct before the PTO
and that the amendment to, and renewal of, the Family Systems IBOOK mark obtained as a
result of these filings are null and void;
(4)

For an award of Apple’s profits based on its ongoing use of plaintiffs’ mark as an

Apple brand that encompasses (i) its electronic library app on its iPad, iPhone and other devices

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and (ii) each electronic book that is downloaded by an iPad, iPhone, iPad Touch, iTunes or
MacBook user via the ibooks app;
(5)

For an award of damages based on the fair market value of the “iBooks” mark to

Apple as a result of Apple’s misappropriation, conversion, and pervasive ongoing infringement
of plaintiff’s ibooks mark;
(6)

For an award of damages based on plaintiffs’ inability to exploit its “ibooks” and

“ipicturebooks” marks in light of Apple’s wholesale appropriation of the mark for use as its
“iBooks” brand;
(7)

For an award of damages based on plaintiffs’ prospective cost of corrective

advertising in order to educate the public that “ibooks” is not the name for electronic books sold
by Apple in connection with its iPad, iPhone, iTunes and other products but rather is a publishing
imprint for books, including electronic books, published by plaintiffs;
(8)

For a declaration pursuant to § 35(a) of the Lanham Act, 15 U.S.C. § 1117(a), that

in light of Apple’s willful and deliberate infringement of plaintiffs’ mark and its filing of false
and misleading statements in the PTO regarding the Family Systems IBOOK mark, this is an
“exceptional case” and awarding plaintiff its attorneys’ fees;
(9)

For an award of punitive damages on the common law claims herein due to

Apple’s deliberate and willful misconduct; and
(10)

For such other, further and different relief as the Court deems just and proper,

together with the costs and disbursements of this action.

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