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

Filing 85

DECLARATION of Jennifer L. Barry in Support re: 83 MOTION in Limine to Exclude any Testimony, Argument or Evidence Regarding the Expert Reports and Opinions of Robert T. Scherer.. Document filed by Apple Inc.. (Attachments: # 1 Exhibit 1 (REDACTED), # 2 Exhibit 2 (REDACTED), # 3 Exhibit 3, # 4 Exhibit 4, # 5 Exhibit 5, # 6 Exhibit 6, # 7 Exhibit 7, # 8 Exhibit 8, # 9 Exhibit 9, # 10 Exhibit 10, # 11 Exhibit 11, # 12 Exhibit 12)(Cendali, Dale)

REDACTED

EXHIBIT 1

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK

J.T. COLBY & COMPANY, INC. d/b/a
BRICK TOWER PRESS, J. BOYLESTON &
COMPANY, PUBLISHERS LLC and
IPICTUREBOOKS LLC,
Plaintiffs,
-againstAPPLE, INC.,
Defendants.

Case No. 11-cv-4060 (DLC)
Expert Report of Robert T. Scherer

TABLE OF CONTENTS
Page
1.

RETENTION. ......................................................................................................................1

2.

QUALIFICATIONS, PRIOR TESTIMONY AND RATE. ................................................1

3.

REVIEW AND INVESTIGATIONS. .................................................................................4

4.

TRADEMARK PRINCIPLES:
Trademark Rights are Based on Use, Not Registration. ................................................6

5.

TRADEMARK CLEARANCE RESPONSIBILITY AND PROCEDURES:
Apple Failed to Conduct an Appropriate Trademark Clearance Search. ...................7

6.

REGISTRATION NO. 2,446,634, TRADEMARK IBOOK:
The Nature and Use of Family Systems’ IBOOK Product is Significantly
Different Than Apple’s IBOOKS Product. ...................................................................17

7.

FAMILY SYSTEMS’ U.S. PATENT NO. 6,411,993:
Apple Failed to Acquire the Underlying Patent for Family Systems’ IBOOK
Product..............................................................................................................................23

8.

THE ASSIGNMENT OF REGISTRATON NO. 2,446,634, TRADEMARK
IBOOK, AND THE ROLE OF GOODWILL:
The Assignment of the IBOOK Mark to Apple was an Invalid Assignment in
Gross..................................................................................................................................24

9.

APPLE’S AMENDMENT AND RENEWAL OF REGISTRATION NO.
2,446,634, IBOOKS (AS AMENDED):
Apple’s Statements in the Declaration of Use Constituted Fraud on the PTO..........29

10.

TRADEMARK DISTINCTIVENESS / DESCRIPTIVENESS:
Plaintiffs’ iBooks Mark is Suggestive and Inherently Distinctive. ..............................32

11.

PLAINTIFFS’ ACQUISITION OF THE iBooks TRADEMARK AND
BUSINESS:
Plaintiffs’ Properly Acquired the iBooks Trademark Out of Bankruptcy. ...............36

12.

iBooks Inc.’s TRADEMARKS iBooks (APPLICATION NO. 75/786,491) AND
iBookstore.com (APPLICATION NO. 75/786,490):
Although Both Applications Were Abandoned, Plaintiffs Continued to Use
the iBooks Mark...............................................................................................................37

i

13.

APPLE’S TRADEMARK IBOOK (REGISTRATION NO. 2,470,147):
Apple’s Original IBOOK Registration is Limited to Computer Hardware
and Required Family Systems Consent to Register......................................................38

14.

APPLE’S IBOOKS (APPLICATION NO. 85/008,412), IBOOKSTORE
(APPLICATION NO. 85/008,432) AND OTHER PREFIX “i” MARKS:
Apple’s Prefix “i” Marks are Famous Marks That are Immediately
Associated with Apple......................................................................................................41

15.

OTHER INFRINGEMENT CLAIMS INVOLVING APPLE’S PREFIX “i”
MARKS:
Apple has been Accused of Trademark Infringement on Numerous
Occasions. .........................................................................................................................43

16.

OPINIONS.........................................................................................................................44

ii

1.

RETENTION.
I was retained by attorneys for plaintiffs in the above-referenced litigation to: (i) discuss

the necessity and importance of conducting appropriate trademark clearance searches before
adopting a new trademark or expanding the use of an existing trademark; (ii) review the validity
of Family Systems’ assignment of its IBOOK mark to Apple and discuss the nature and
requirement of goodwill; (iii) compare the nature of Family Systems’ use of its IBOOK mark
with Apple’s post-acquisition use of the IBOOKS mark (as amended); (iv) review the statements
made in Apple’s Declaration of Use filed in Reg. No. 2,446,634; (v) review and explain the
several applications and registrations filed in the U.S. Patent and Trademark Office (“PTO”) by
plaintiffs and defendant including Reg No. 2,470,147; Reg. No. 2,446,634; Reg. No. 2,718,222;
App. No. 85/008,412; App. No. 85/008,432; App. No. 75/786,490; and App. No. 75/786,491;
(vi) discuss whether iBooks 1 is a distinctive/descriptive mark; and (vii) review the validity of the
assignment of the iBooks mark out of bankruptcy to plaintiffs.
2.

QUALIFICATIONS, PRIOR TESTIMONY AND RATE.
I am a member of the New York State Bar Association and the District of Columbia Bar

Association and have been practicing in the area of trademark law since 1972. I retired from
active practice in December, 2005, but have continued to stay abreast of developments in the
trademark field. I have not previously testified as a trademark expert witness.
Upon graduation from Wayne State University Law School in 1972, I was employed by
the U.S. Patent and Trademark Office (“PTO”) as a Trademark Examiner. While in that
position, I regularly (i) reviewed trademark applications for compliance with the mandatory
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In order to aid in distinguishing between the parties respective marks, whenever
possible, I have chosen to display plaintiffs' marks with an initial lower-case letter, followed by a
single upper-case letter, i.e., iBooks or iBooks, Inc. and Family Systems' and Apple's marks in
all upper-case letters, i.e., IBOOKS or IBOOK.

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filing requirements; (ii) conducted searches of the Trademark Register and of pending
applications; (iii) reviewed marks for descriptiveness; (iv) prepared PTO Office Actions and
reviewed responses thereto; (v) prepared several briefs to the Trademark Trial and Appeal Board
(“TTAB”) in support of final refusals; and (vi) on a rotating schedule, served with the PostRegistration Branch reviewing registrations for Sections 8 and 15 compliance and Section 9
renewal and as an interlocutory examiner with the TTAB. During my two years and three
months with the PTO, I reviewed approximately 2,000 applications.
In August, 1974, I went to work for the intellectual property law firm of Pennie &
Edmonds. As an Associate with the firm, I regularly (i) advised clients on basic trademark law
and PTO procedures; (ii) conducted trademark clearance searches for conflicting registered,
pending and common law marks; (iii) prepared and filed U.S. trademark and service mark
applications; (iv) prepared and filed responses to PTO Office Actions; (v) prepared and filed
Post-Registration documents including Section 8 and 15 Declarations of Use and Incontestability
and Section 9 Renewals; and (vi) prepared and filed assignment and change of name documents.
I also participated in several inter partes opposition and cancellation proceedings in the PTO and
trademark infringement litigation in the federal courts. During almost five years with the firm, I
was responsible for filing and prosecuting approximately 500 U.S. trademark/service mark
applications.
In 1979, I went to work for PepsiCo, Inc. as a Trademark Attorney. In that position, I
advised various subsidiary companies, i.e., Frito-Lay, Pizza Hut and Wilson Sporting Goods,
among others, on all trademark related matters, including, but not limited to (i) the selection,
searching and clearance of U.S. and foreign trademarks; (ii) the filing and prosecution of U.S.
and foreign trademark applications; (iii) the renewal of U.S. and foreign trademark registrations;

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(iv) the filing of U.S. and foreign oppositions and cancellation actions; (v) trademark licensing
and (vi) the review of advertising and promotional materials for proper trademark use. While at
PepsiCo, I filed and prosecuted approximately 100 U.S. trademark applications and was
responsible for the maintenance and renewal of approximately 10,000 U.S. and foreign
registrations.
In 1983, I moved to Time Inc. as a Trademark Attorney and assumed responsibility for its
entire portfolio of U.S. and foreign trademarks. In that position, I oversaw the selection,
clearance, filing of applications, prosecution of applications, maintenance and protection of more
than 20,000 U.S. and foreign trademark registrations, including such well-known marks as
TIME, SPORTS ILLUSTRATED, FORTUNE and PEOPLE Weekly for magazines; HBO and
CINEMAX for television programming services; TIME-LIFE, WARNER BOOKS and
LITTLE, BROWN for book publishing and the TIME WARNER corporate mark and logo. I
also supervised the assignment of several large trademark portfolios during my 22 years with the
various Time Warner (a successor company) companies. I was responsible for the daily
monitoring of trademarks for infringement and for taking appropriate action when found. I
oversaw the licensing of the company’s trademarks and the registration and protection of Internet
domain names. Through various promotions during my career, when I retired in December,
2005, I was Assistant General Counsel of Time Warner Inc. and had filed approximately 900
U.S. trademark applications on behalf of the company and its subsidiaries.
During my thirty-three years of trademark practice, as a Trademark Examiner in the PTO,
as a law firm associate, and as a corporate trademark attorney, I have conducted and reviewed
thousands of trademark searches and cleared such now well-known marks as InStyle,
ENTERTAINMENT WEEKLY and REAL SIMPLE for use on magazines, as well as the TIME

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WARNER mark and corporate name. I have also conducted numerous searches and
investigations in connection with the expansion of such existing brands as PEOPLE Weekly,
HBO and CINEMAX. I have examined, filed and/or prosecuted more than 3500 applications
and been responsible for the maintenance of thousands of registrations in the United States
Patent and Trademark Office. In all these positions, I regularly advised clients and participated
in such trademark related matters as trademark searching and clearance, trademark application
filings and prosecution, trademark maintenance and renewal, trademark assignments and
trademark licensing.
My compensation as an expert witness in the above-referenced matter is $500 per hour.
A copy of my current curriculum vitae is attached hereto as Exhibit A.
3.

REVIEW AND INVESTIGATIONS.
In connection with the preparation of this report, I was provided with and reviewed the

following documents and materials:
Court Documents
Complaint and Jury Demand
Answer and Affirmative Defenses of Defendant
Materials Provided by Plaintiffs’ Counsel
Archived Materials from Family Systems’ “iBook” Website
Archived Materials from urls located via Family Systems’ “iBook” Website
Family Systems’ “iBook” Instructions and General Information
TESS Search Results for “ibook” Applications/Registrations
Listings from Publishing Industry, Book Seller and Comic Book Websites (1999-2010)
Current Listings from Publishing Industry and Book Seller Websites (Sept./Oct. 2011)
Wikipedia Entry for Byron Preiss

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Google Search Results for “iBooks” with “Publisher(s)/Publishing” (2009)
Advanced Search Results for “iBooks” with “Publishers or Publishing” (2009)
Deposition Transcript of Richard S. Goldhor, Ph.D., January 31, 2012
Deposition Transcript of John T. Colby, July 18, 2012
An Article titled “Trademark Searching” by Glenn Gundersen, 1994
Several Saegis Reports of Apple Trademark Searches
Memo Titled APPLE IBOOK AND IBOOKSTORE with Search Strategies
An Invoice for

for the IBOOK Settlement Payment, dated January 29, 2010

NY Certificate of Assumed Name iBooks, dated December 12, 2006
iBooks ITD September 2005 C/B Worksheet
J. Boyleston & Company, Publishers Consolidated Income Statement 1999 – 2011
United States Patent and Trademark Office Documents
File Wrapper for Reg. No. 2,446,634 IBOOKS (as amended)
File Wrapper for Reg. No. 2,470,147 IBOOK
File Wrapper for Reg. No. 2,718,222 ipicturebooks.com
File Wrapper for App. No. 85/008,412 IBOOKS
File Wrapper for App. No. 85/008,432 IBOOKSTORE
File Wrapper for App. No. 75/786,490 iBooksinc.com
File Wrapper for App. No. 75/786,491 iBooks
File Wrapper for Patent No. 6,411,993
I also used and reviewed the following PTO databases:
Trademark Electronic Search System (TESS)
Trademark Applications and Registrations Retrieval (TARR)
Trademark Manual of Examining Procedure (TMEP)
Trademark Document Retrieval (TDR)

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Trademark Assignment Services
Trademark Rules of Practice
U.S. Trademark Law, 15 U.S.C. Section 1051 et seq. (Lanham Act) In addition to these
documents and materials, I reviewed relevant sections of McCarthy on Trademarks and Unfair
Competition, 4th edition, J. Thomas McCarthy (2005) and performed advanced searches of the
Google and Amazon.com databases.
4.

TRADEMARK PRINCIPLES:
Trademark Rights are Based on Use, Not Registration.
A trademark is defined as any word, name, symbol or device, or any combination thereof,

used to identify and distinguish one’s goods from those manufactured or sold by others and to
indicate the source of the goods, even if that source is unknown. See Lanham Act, 15 U.S.C.
Section 1127. (The Lanham Act is the federal statute governing trademarks in the U.S.)
Trademarks are sometimes referred to as brand names. In the United States, trademark rights are
created when the mark is actually used in commerce on or in connection with goods in the
ordinary course of trade. Such marks are referred to as common law trademarks. The owner of a
common law mark may elect to register it in the PTO, but registration is not required in order to
own the mark or to claim a priority of use. While there are some procedural and evidentiary
advantages to owning a federal trademark registration, a common law or unregistered mark is
entitled to the same substantive rights and protection as a registered mark.
There are two primary bases on which to file an application to register a trademark in the
PTO. First, the application may be based upon actual use of the mark in interstate commerce.
This is referred to as a use-based application filed under Section 1(a) of the Lanham Act.
Second, the application may be based upon a bona fide intent to use the mark in interstate
commerce. This is referred to as an intent to use or ITU application and is filed pursuant to

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Section 1(b) of the Lanham Act. Even though the ITU application is filed before actual use of
the mark begins, the registration will not be granted until the mark has been used in interstate
commerce and evidenced to the PTO. While there are other bases for filing trademark
applications, they are not relevant to this litigation.
5.

TRADEMARK CLEARANCE RESPONSIBILITY AND PROCEDURES:
Apple Failed to Conduct an Appropriate Trademark Clearance Search.
When selecting a new trademark or materially expanding the use of an existing mark, it is

imperative that the trademark attorney conduct the necessary searches and, if appropriate,
follow-up investigations to determine whether the proposed mark is available for the intended
use. The question to be answered: “Is the use of the mark likely to cause confusion with an
existing third party mark?” There are at least three basic steps in the searching process.
First, the trademark attorney, either in-house or outside counsel, will customarily conduct
a screening or “knock- out” search in one or more available databases, including the PTO’s
Trademark Electronic Search System (TESS) or another commercially available database such as
Thomson Compumark’s SAEGIS service. By definition, these preliminary or screening searches
are limited to PTO and state trademark records, but they do not include any common law or
domain name records. A copy of a Thomson Compumark online promotional piece describing
the SAEGIS service as a “screening” or “knock-out” search is attached as Exhibit B. Because of
these limitations, the clearance process cannot stop here. If the screening search is “clear”, in
that it did not disclose any confusingly similar third party marks, the second step is to order a
more comprehensive “full” search through one of several commercial vendors. Such searches
can be performed on a 4 hour turnaround, if necessary, or more commonly on a 2 - 3 day
turnaround. The largest commercial trademark search firm is Thomson Compumark, and I have
attached a representative example of one of their full search reports as Exhibit C. In addition to

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the PTO and state trademark databases discussed above, a full search includes (i) appropriate
common law databases; (ii) web databases such as Google and Yahoo; and (iii) domain name
databases. Also, because the test for trademark infringement is not limited to identical marks,
but includes “confusingly similar” marks, a full search is more comprehensive in that it includes
similar marks, variant spellings and phonetic equivalents.
If either the preliminary screening search or the more comprehensive full search disclose
a potentially conflicting mark, the third step is for the trademark attorney to undertake a further
investigation to determine the nature and extent of use of that mark. The investigation can take
several forms. If the mark is the subject of a federal registration (active/cancelled/expired) or an
application (active/abandoned), one can order the PTO file history of that mark to try to better
determine if and how the mark is being used. It is also possible to conduct an appropriate online
search to see if there are any references to the mark on the Internet. Another option is to hire a
professional trademark investigator to look into any use of the mark. Only after these searches
and any necessary investigations have been completed and there appear to be no confusingly
similar marks in use or, if a confusingly similar mark has been found, any likelihood of
confusion has been resolved via acquisition, license or consent, should use of the proposed mark
begin.
With the foregoing principles in mind, I reviewed Apple’s clearance of the IBOOKS
mark and found that while it conducted the preliminary screening search of Thomson
Compumark’s Saegis database and several narrow searches limited to the Google search engine
(step 1), it completely ignored the comprehensive full search (step 2) and any follow-up
investigation (step 3). In my opinion, Apple’s failure to conduct an appropriate
search/investigation was irresponsible and a serious departure from standard trademark searching

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practice, I find it surprising that a large and sophisticated company, like Apple, did not follow-up
with a more comprehensive search.
I should mention here that Apple owns a federal registration for the IBOOK mark for
“computer hardware” (Reg. No. 2,470,147) and claims to own a second federal registration for
the mark IBOOKS (as amended) for “computer software used to support and create interactive
user-modifiable electronic books” (Reg. No. 2,446,634). Apple asserts that its use of the
IBOOKS mark in connection with downloadable books and the electronic transmission of
streamed and downloadable books is simply an expansion of these two earlier registrations so
that further searches and/or investigations are unnecessary. In order to see just how far Apple
intended to “expand” its use of the IBOOK/IBOOKS mark, I reviewed the list of goods/services
recited in Apple’s most recent ITU applications to register the IBOOKS mark (App. No.
85/008,412) and the IBOOKSTORE mark (App. No. 85/008,432), both of which were filed on
April 7, 2010. As filed, both applications contained a lengthy list of goods and services in six
Classes. 2 In addition to “computers” in Class 9, which may qualify as an expansion of the earlier
IBOOK registration, the applications go on to state that Apple has a bona fide intention to use the
IBOOKS and IBOOKSTORE marks in connection with “printed matter...” in Class 16;
“advertising and marketing services... in Class 35; “telecommunications services...” in Class 38;
“educational and entertainment services...” in Class 41; and “design and development of
computer hardware and software...” in Class 42. In Class 16, for example, Apple included the
items “printed publications; periodicals; books; magazines; newsletters...; Class 35 included the
items “sales promotion services; promoting the goods and services of others; conducting market

2

As we will see in subsequent sections, the PTO has created arbitrary classes of goods
and services numbered from 1 – 45. The primary purpose of this classification system is to allow
the PTO to charge separate filing fees per class.

9

research...” and Class 41 included “podcasts in the fields of entertainment, news, current events
and activities, hobbies...”. (The actual list of goods/services goes on for almost two full singlespaced pages.)
Are we to believe that this long list of new uses “merely seeks to expand Apple’s
registration of the IBOOKS mark to goods and services related to those for which the mark is
already registered”? That’s what Apple told the Trademark Examiner in its response to a PTO
Office Action. However, it is obvious that this is far more than a mere expansion of the earlier
IBOOK/IBOOKS registrations as it encompasses numerous entirely new uses of the mark which
require an entirely new comprehensive search and clearance. (It appears that Apple subsequently
amended the above-referenced IBOOKS application by deleting Classes 16, 38 and 41, but kept
all six Classes in the IBOOKSTORE application. Even with this amendment, the three
remaining Classes in the IBOOKS application represent far more than an expansion of the earlier
marks and Apple had gone on record as intending to use the IBOOKS mark in connection with
all of the goods/services originally listed in the applications.) Also, the fact that Apple found it
necessary to conduct even a preliminary screening search of the IBOOKS mark is an indication
that this expanded use far exceeds the coverage of the earlier registration. Apple has a duty to
properly search and clear new marks or new uses of existing marks; being a very large and
successful company does not excuse Apple from responsibility and respect for the trademark
rights of others.
I have reviewed copies of several SAEGIS searches which appear to have been
conducted by Apple’s outside counsel and found that one of those searches disclosed the marks
iBooks (App. No. 75/786,491) covering “books, namely, a series of fiction books; non-fiction
books in the field of science” and iBooksinc.com (App. No. 75/786,490) for “computerized on-

10

line ordering services in the field of printed publications” and “providing a website on global
computer networks featuring information on the field of printed publications”, both filed by the
plaintiffs’ predecessor-in-title, iBooks, Inc. see Exhibit D. Based upon this search, Apple was
clearly aware of plaintiffs’ iBooks and iBooksinc.com marks and even though the applications
were abandoned in 2003 for failure to respond to a PTO action and tagged as “DEAD”, they
remained as a possible bar to Apple’s use of the IBOOKS mark and required further
investigation. Since, as noted in Section 4, trademark rights are based on use, not registration. I
then conducted my own search of the PTO’s TESS database which again disclosed the iBooks
and iBooksinc.com applications.
Another search document produced by Apple under the heading “APPLE IBOOK and
IBOOKSTORE” referred to the “PRELIMINARY SEARCH STRATEGIES” and listed the
strategies used in running several different searches. See Exhibit E. Based upon the above
references, this document appears to relate only to a preliminary search of the IBOOK and
IBOOKSTORE marks and I have seen no other documents indicating that any comprehensive
full searches were commissioned.
I also reviewed several documents showing the results of a Google search of such terms
as “ibook”, “ibookstore”, “ebook”, “ebookstore”,”eyebook”, “eyebookstore”, “mybook” and
“mybookstore” in various forms. Sometimes these terms were combined with a list of goods,
including “computer”, “software”, “electronic”, “online”, “device” or “reader”. They were often
further broken down into Apple and non-Apple references. It is my understanding that these
searches may have been conducted by Apple’s outside counsel. All of these searches were made
using the Google search engine and no effort was made to search publishing or book related
websites such as Amazon.com. While none of these searches disclosed any references to

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plaintiffs’ iBooks mark, this was not unexpected, because in reviewing the search strategies, it
looks as if Apple or its outside attorneys made a concerted effort to avoid any terms which were
likely to uncover the plaintiffs’ iBooks mark or name. Apple was aware of plaintiffs’ presence
in the publishing industry based upon a SAEGIS search, see Exhibit D; yet it never conducted a
search of the iBooks, Inc. name. If Apple had searched “ibooks” combined with plaintiffs’
company name, iBooks, Inc., as I recently did, it would have found numerous articles referring to
plaintiffs’ ongoing iBooks business. In my search, the first 35 “hits” referred to iBooks and/or
iBooks, Inc. Apple could have, and should have, performed the same search. I was left with the
impression that Apple specifically designed the search to avoid finding references to plaintiffs’
business. In addition to this failure to search the appropriate terms/names, Apple also
deliberately combined several search terms with the word Apple, which would, of course,
eliminate finding any references to plaintiffs’ mark/name. Although reference was made to a
“TRADEMARK.COM DOMAIN NAME SEARCH in Exhibit E, I have seen no report showing
that such a search was ever made.
The appropriate next step was to order the PTO file history to see why the application
was abandoned and whether the mark has been used. In reviewing the PTO file, I learned that (i)
iBooks, Inc. has been using the iBooks mark since 1999, and was planning to file an amendment
to allege use shortly; and (ii) iBooks, Inc. had iBooks sales in excess of $5,000,000 and spent
over $250,000 in advertising and promoting the iBooks mark in the first three years of business.
This important information was readily available to anyone who took the time and effort to order
the PTO file. Even though the application had been abandoned, the iBooks mark was being used
and remained a viable and valuable trademark belonging to plaintiffs. The disclosure of iBooks,

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Inc.’s iBooks mark in the limited screening search was a “red flag”, which required further
investigation.
In order to see what an investigation would have found, I again entered “ibooks” with
“iBooks, Inc.” in Google and found several references to Byron Preiss’ and/or iBooks, Inc.’s
iBooks mark. Having found that the iBooks mark and the iBooks, Inc. company name are still
being reported in online databases, the next step in my investigation was to search several
databases devoted to the publishing industry, such as Amazon.com, Bowker’s Books in Print and
Publishers Weekly, to determine the nature and extent of that use. A search of Amazon.com
disclosed more than 600 books published by plaintiffs’ predecessor before May 23, 2006 under
the iBooks mark, with many of the books offered in a digital format. A search of WorldCat, a
database which allows access to the collections of over 10,000 libraries worldwide, for each of
the years 1999 - 2009, disclosed hundreds of books published by iBooks, Inc. and using the
iBooks mark. A search of My Comic Shop, the world’s largest online selection of comic books,
for the years 2000 – 2006, disclosed a long list of iBooks’ published comic books. Similarly, a
search of iBooks at comics.org, which is dedicated to building a database covering all printed
comics throughout the world, for the years 2003 – 2005, again revealed numerous comic books
using the iBooks mark.
A search of Publishers Weekly (“PW”), which refers to itself as “The International News
Magazine of Book Publishing and Bookselling” for each of the years 1999 - 2009, found
repeated references to both iBooks and iBooks, Inc. beginning as early as May 24, 1999, with the
following reference:
“Byron Preiss Visual Publications will launch a new imprint in September [1999]
that will focus on books with content appropriate for marketing on the Internet.
The imprint, ibooks, will be done in cooperation with Pocket Books, which will
serve as ibooks’ distributor.”

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The June 7, 1999, issue of PW included the following:
“...longtime multimedia publisher Byron Preiss discussed his new project, iBooks,
which will combine classics of science, science fiction, history and mystery, in
trade paper, with free browsable chapters available online.”
A PW article on March 3, 2003, stated that:
“The fastest growing publisher on this year’s list is ibooks, the newest publishing
venture launched by Byron Preiss in 1999. The company publishes in a mix of
segments and formats, including e-books.”
After Byron Preiss’ tragic death in July, 2005, and the sale of the company’s assets in bankruptcy
to plaintiffs’ on December 13, 2006, PW continued to refer to the iBooks mark and the iBooks,
Inc. name in various articles.
A Google search of “ibooks” combined with the words “publisher/publishers/publishing”
for each of the months April – December, 2009, which closely preceded Apple’s launch of its
new IBOOKS product, disclosed numerous references to plaintiffs’ iBooks mark. And, finally, a
search on Wikipedia of the name “Byron Preiss”, the founder of the Ibooks imprint and one of
the pioneers of electronic publishing, included several references to the iBooks mark and listed
several books published by iBooks, Inc.
I then reviewed the results of more recent online searches conducted in September October, 2011 of “iBooks” and “iBooks, Inc.” The updated search of Amazon.com identified
742 books referring to either iBooks or iBooks, Inc. and included references to the series names
“ibooks Fantasy Classics” and “Ibooks Science Fiction Classics”. I followed-up with my own
search of Amazon.com and found such additional series names as “Ibook Fan Books”,
“Instructor Ibook”, “Law and Order (Ibooks)”, “Military History (Ibooks)”, “Rabbi Small
Mysteries (Ibooks)”, “Student Ibook”, “Transformers (Ibooks)” and “X-Men (Ibooks)”. I also
examined the results of an “iBooks” search at barnesandnoble.com which disclosed over 750
iBooks references. Similar searches of Books by ISBN (an ISBN or International Standard Book

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Number is assigned to each edition and variation of a book) and Bowker’s Books in Print (R.R.
Bowker, LLC provides information support for the publishing industry in the United States.
Bowker is the official U.S. ISBN Agency, the publisher of Books In Print and other compilations
about books and periodical titles.) yielded hundreds of current uses of plaintiffs’ iBooks mark.
Similar databases are included in the common law portion of a comprehensive full search and
would have disclosed many of these same references to plaintiffs’ use of the iBooks mark had
Apple taken that next all important step to clear the mark.
The pleadings in this case also refer to plaintiffs’ ipicturebooks and ipicturebooks.com
marks, the latter of which was the subject of a cancelled registration for “books in print in the
field of fiction and non-fiction for children” and “computer services, namely, online books in
the field of fiction and non-fiction for children”, owned by iBooks, Inc. I conducted an online
search of three databases to determine the nature and extent of use of these marks. At a website
called JacketFlap, which lists the work of 200,000+ authors, illustrators, publishers and other
creators of books for children and young adults, I found more than 350 ebooks published by
ipicturebooks. A similar search at Amazon.com disclosed more than 90 current books published
by ipicturebooks and a search of the Diesel eBook Store listed over 190 ipicturebooks books for
sale.
Based upon these several common law searches and investigations, it is evident that
plaintiffs’ iBooks and ipicturebooks marks are actively used and regularly referenced in a wide
variety of databases dedicated to the publishing industry. An appropriate common law search/
investigation would have quickly disclosed plaintiffs’ iBooks and ipicturebooks marks. To have
either failed to perform these investigations or to have ignored the results of an investigation is
highly irresponsible.

15

I also reviewed a treatise entitled “Trademark Searching”, first published in 1994, written
by Glenn Gundersen, a copy of which is attached as Exhibit F. I understand that Mr. Gundersen
and his firm have on several occasions, including in the early stages of this iBooks/IBOOKS
conflict, provided trademark legal services to Apple. The overriding message of this treatise is
that “A trademark search is the critical legal step in the process of selecting a new mark.” In
discussing the mechanics of the search process, Mr. Gundersen states at page 3:3 that:
“A newcomer to the search process might expect that it would suffice to check the
records of the U.S. Patent and Trademark Office. However, one cannot rely
solely on such a search because registration with the Trademark Office is not a
prerequisite to obtaining trademark rights in the U.S. Many valid trademarks
exist at common law without ever appearing on the federal trademark register.
Some appear in state registrations (although these registrations do not always
reflect actual use); others are not registered at all. Thus, the search must
encompass marks beyond those shown in federal applications and registrations.”
Later in the same treatise, Mr. Gundersen states at page 3:11 that:
“The preliminary search uses a limited number of resources and queries the
searcher deems most likely to yield relevant marks with minimum effort. It
serves to eliminate marks that are clearly unavailable; it does not attempt to reach
a definitive answer on the availability of those marks that survive. Thus, while a
preliminary search can yield a clear “no” to a proposed mark, it cannot yield a
clear “yes”. Only the potential for a “yes” can be reached at this point.”
And, finally, Mr. Gundersen states at page 3:29 that:
“When counsel finds a potentially conflicting mark, it is usually necessary to
investigate further to determine if the mark has been abandoned, to better
understand the nature of the goods or services sold under the mark and the
marketing channels used, to ascertain the status of any pending applications and
registrations...”
Despite the fact that Apple’s attorneys are accomplished trademark professionals with years of
experience, they appear to have departed from the recommended protocol of their own outside
counsel and proceeded to use the IBOOKS mark in connection with downloadable books based
solely upon a preliminary or screening search. They failed to order a more comprehensive full
search or to undertake an appropriate investigation into the use of plaintiffs’ iBooks mark, even

16

though they knew of its existence based upon their preliminary SAEGIS search and John Colby’s
January 29, 2010 e-mail. This failure to follow the customary steps in clearing the IBOOKS
mark was a glaring omission and evidences a total disregard for the trademark rights of others.
6.

REGISTRATION NO. 2,446,634, TRADEMARK IBOOK:
The Nature and Use of Family Systems’ IBOOK Product is Significantly Different
Than Apple’s IBOOKS Product.
(a) On October 8, 1996, a U.K. company called Family Systems Limited filed an ITU

application in the PTO (App. No. 75/182,820) to register the trademark IBOOK for “computer
hardware and software used to support and create interactive, user-modifiable electronic books”.
Upon reviewing the application, the Trademark Examiner determined that the application was in
order and a search of the Trademark Register and pending applications did not disclose any
conflicting marks. The Trademark Examiner subsequently approved the IBOOK mark for
publication in the Official Gazette (“OG”). (Publication of a mark in the OG allows any person
who believes that they will be damaged by the registration of a mark an opportunity to oppose or
object to the registration of that mark.) In this case, no opposition was filed and a Notice of
Allowance was sent to Family Systems giving them six months to file a Statement of Use along
with evidence that the mark is being used on the recited goods. At the end of the six months,
Family Systems filed a First Request for Extension of Time to File a Statement of Use. The
extension was granted and the Applicant obtained an additional six months to file a Statement of
Use. (Trademark Rules allow for the filing of up to five requests for extensions of time and,
since Family Systems had not yet begun to use the IBOOK mark, they eventually filed the
maximum number of extensions stating in the second, third, fourth and fifth requests that
“Applicant is still actively engaged in research and development in connection with the products

17

with which the mark will be used.”) The PTO accepted the statement of Family Systems’
ongoing efforts to use the mark and granted all five requests.
On November 6, 2000, Applicant was finally able to file the required Statement of Use
claiming that the mark was first used on “computer hardware and software used to support and
create interactive, user-modifiable electronic books” on October 27, 2000. The specimens
showing how the mark is used consisted of (i) what appears to be a screenshot from a website
maintained by hinmanconsulting which states:
“Welcome to TeamGirl
A Community Dedicated to Girl’s Sports and
related Activities
If you would like to to [sic] contribute to this site and/or create a personal Ibook on this site
related to Girl’s Sports, follow the links above to download and install the Family Systems Ibook
Controller and to enroll in this site. Click on Identity Ibooks above to see a list of currently
available Ibooks on this site.
Powered By Ibook Technology From family systems (Logo)
Send Comments to:[e-mail]”
(ii) what appears to be another screenshot from a videoboy.com website which states:

18

“Welcome to VideoBoy
The purpose of this site is to provide a collaborative and self-extensible Ibook...
games. This site currently targets the Linux gaming community to assist such...
their Linux system to play Linux video games such as Quake3...
[The text on the right margin was cut-off in the file.]
Powered by Ibook Technology From family systems (Logo)
If you would like to become a contributor:
1) Download the Ibook Controller Setup Program
2) Become a Contributor (requires Ibook Controller)
3) View List of Current Contributors
4) View List of Current Identity Ibooks on this Site”
and (iii) what appears to be a label from an Ibook controller. These specimens were filed in the
PTO because they show the actual use of the mark, the nature of the use and the manner in which
the IBOOK mark is displayed. It is immediately apparent that the “electronic books” referred to
in the registration are created by the user and devoted to specific “communities” of users. The
IBOOK product itself does not contain a book or any other published work. It merely provides a
framework on which to create one’s own content. It is the electronic equivalent of buying a
blank piece of paper and then having to write your own story. Upon acceptance of the Statement
of Use, the PTO granted registration to the IBOOK mark on April 24, 2001, as Reg. No.
2,446,634.
In order to maintain this registration, Family Systems filed a Combined Declaration of
Use and Incontestability Under Sections 8 & 15 on April 27, 2007. Family Systems stated
therein that they were still using the IBOOK mark in connection with “all goods or services
listed in the existing registration...”, except for the item “hardware” which they deleted from the
registration. This was presumably done to comply with the Consent Agreement with Apple (See
Section 13). As evidence of their then current use of the IBOOK mark in connection with
computer software, Family Systems attached a screenshot referring to “topic-rooms” which tells

19

the user to “Add your content here.” With the deletion of “hardware”, the PTO accepted the
combined Declaration of Use and Incontestability. This was the status of Family Systems’
IBOOK registration when it was transferred to Apple (See Section 8).
(b) In order to better understand what Family Systems’ IBOOK software product is and
how it works, I reviewed materials from Family Systems’ IBOOK website for the period 1998 2010. These materials consist of page after page of references to “The IBook Help Site”, “The
Family Systems Ibook Ibook”, “Family Systems Public Ibook”, a repetitive advertisement for
“Products Now Available” and “The Family Systems ibook Home Page” which lists “The ibook
Family of Products” including:
“The ibook Controller

For creating and managing interactive books on
webs. Ibooks enable and encourage
collaboration.

The ibook Server

Software for hosting your own ibooks. Family
Systems also provides web hosting services.
Web publishing for documents received by fax

Fax Processor
My Sharer

My Sharer automatically publishes files to the
Internet.

Audio Recorder

Record, index and access your conferences and
personal phone calls.

Progress List

Create and manage task lists”

Another promotional piece called “Welcome to try.ibooks.com” stated that “This site is for users
of the Family Systems ibook system. On this site, you can create your own ibook, and manage
the content of that ibook using the ibook controller and other Family Systems products. It
operates under a set of site rules.” (emphasis added). One of the few IBOOK sites having any
content is called “Vikram’s Travels”, which appears to consist entirely of content created by a
person named Vikram Singh describing his journey to Sri Lanka and India gathering family
stories. Mr. Singh went so far as to copyright the content on these Web pages in his own name.

20

I also reviewed archived material from the http://try.ibook.com website. Family
Systems’ created this website to give people an opportunity to get a free trial ibook Web space:
“Enroll for a trial subscription and we’ll provide you with Web space on our trial
site, try.ibook.com. Once enrolled, you can use our ibook form to create weblogs
and begin publishing to the Web right away. With our Web Page Controller, you
can use any HTML editor to immediately create and modify your ibook’s pages,
and to import voice recordings made with our Personal Audio Recorder. From
try.ibook.com, you can also download our experimental and prerelease products
and use them to construct comprehensive systems to share Web pages, chat and
voice content alongside traditional PC media.”
(emphasis added).
The materials from the “Try IBOOK” website consist of several hundred “Identity Ibook” sites
with personal names or monikers and little, if any, additional content. These web pages were
created pursuant to Family Systems’ offer to provide free webspace on a trial basis. Examples of
weblogs with actual content include:
“UPA Voting Ibook:
IEEE P1583 Voting System Standards
which was created for “members of the UPA Voting and Usability Project. It
contains notes and files on the IEEE P1583 Voting System Standards sections on
usability and accessibility and work with Task Group 3 (TG3). This ibook page
was contributed by “upavoting”.
“US Constitution Identity Ibook”
with a further contribution titled “Life, Liberty & the Pursuit of Happiness”
contributed by “national”.
“david ottershaw [ibook identity]” contributed by “yorkshireman”
“Barbara McCandless’s Ibook Web Site” contributed by “funwithpix” which
includes the statement that “This is a private Web site for the exclusive use of the
CM consultants in my downline and others to whom I’ve given access.”
I also reviewed several examples of Family Systems’ instruction, marketing and website
content materials. Based upon all the aforementioned material, I have concluded that Family
Systems’ IBOOK system is best described as “a web content publishing tool” which allows users

21

to create, publish and share information via the Internet or intranet. The website is created by a
sponsor who then controls the website and decides who shall be permitted access. Content is
placed on the website and edited by the sponsor and other contributors. The IBOOK system can
support a shared identity IBOOK which is visible to all enrollees to the site or a private identity
IBOOK which is visible only to the owner of the IBOOK. The IBOOK system includes several
features to allow the user to perform enhanced tasks, many of which require the purchase of
additional software or hardware. In summary, Family Systems’ IBOOK software system is a
very different product with a very different use than Apple’s downloadable electronic book or ebook product. 3
Because Family Systems never used its IBOOK mark for the distribution of existing
books, it had no trademark rights in the IBOOK mark for that use. Also, since goodwill is based
upon consumers’ recognition or mental association of a mark with a single source, there can be
no goodwill in a “mark” which was never used.

3

I have reviewed the January 31, 2012 deposition transcript of Richard Goldhor, Ph.D.,
who was a technical consultant to Family Systems from 1996 to 2003/2004. During that time, he
was instrumental in the development of the IBOOK software which he described as “an
architecture for allowing a community to create material, including text, but not limited to text,
and to publish it using web technologies, but to also make it possible for multiple members of the
community to edit that material, comment on it, to create their own versions of it, and so forth.”
Dr. Goldhor describes Family Systems' IBOOK system as having user-generated content similar
to Wikipedia, which allows the contribution and editing of shared content. On crossexamination, Dr. Goldhor was asked whether Family Systems' IBOOK technology could be used
by commercial publishers to make their books available to others. He stated that the next
technology could be used in this manner, but noted that any such books would have been created
by users of the Family Systems' software. The several questions regarding the publication of a
book via this IBOOK system were all hypothetical in nature. The fact is that Family Systems did
not design the IBOOK product for this use and did not intend for it to be used as a vehicle for the
distribution of published books. Dr. Goldhor even indicated that it would require a future
generation of technology to make such a use possible.... a generation that never came!
Trademark rights, however, are based on actual use of a mark in commerce in the ordinary
course of trade. (emphasis added)

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7.

FAMILY SYSTEMS’ U.S. PATENT NO. 6,411,993:
Apple Failed to Acquire the Underlying Patent for Family Systems’ IBOOK Product.
I read the general description of the invention in Family Systems’ U. S. Patent No.

6,411,993 entitled “Interactive web book system with attribution and derivation features”, which
reads as follows:
“An interactive Web book (“ibook”) system is provided that allows material to be
contributed to the World Wide Web. An ibook is a self-extending, self-sustaining
information-redistributing Web robot, which is resident on a data network such as
the Internet or an intranet. Users may enroll with an ibook as viewers or
contributors. Viewers may view ibook material, such as text or multimedia
content. Contributors may contribute original material to the ibook or may create
derivations of existing ibook material. Attribution information that identifies the
source of material in a derivation is automatically generated. Information
concerning the derivation of each work and its characteristics can be used to help
the user navigate through ibook material. The ibook system keeps track of how
often users access each work within an ibook. Contributors may be automatically
rewarded (e.g., by a monetary distribution) based on the extent to which their
contributed material is viewed by the users.” (emphasis added).
This same document explains the background of the invention in the following excerpt:
“This invention relates to the Internet, and more particularly, to techniques for
creating and viewing material on the World Wide Web in the form of an
interactive Web book.
The World Wide Web has made the Internet accessible to a broad range of
people. One can search the Web and view a large amount of material using a
Web browser. However, there is no satisfactory framework within the Web to
encourage contributions of new material while rewarding contributors for their
efforts. As a result, many people who might make meaningful contributions of
entertaining or educational material to the World Wide Web do not make such
contributions.
It is therefore an object of the present invention to provide a way in which to
facilitate the contribution of material using a data network such as the World
Wide Web and to compensate the contributors of such material.”
This patent appears to cover the totality of Family Systems’ IBOOK product and to be integral to
the continuation of the Family Systems business. The fact that it was not acquired by Apple
along with the IBOOK trademark raises questions regarding the transfer of goodwill and the

23

validity of the trademark assignment (See Section 8). According to the PTO Patent Assignment
records, this patent is currently owned by FASM Network Services, LLC, which, based upon the
acronym, appears to be related to Family Systems Limited.
8.

THE ASSIGNMENT OF REGISTRATON NO. 2,446,634, TRADEMARK IBOOK,
AND THE ROLE OF GOODWILL:
The Assignment of the IBOOK Mark to Apple was an Invalid Assignment in Gross.
On January 29, 2010, Family Systems Limited signed a document transferring and

assigning to Apple Inc. “all right, title and interest in and to [Reg. No. 2,446,634], any other
rights or registrations that Family Systems may have in the mark and trade name IBOOK,
including without limitation any common law rights, and the goodwill of the business pertaining
thereto.” Apple had known about this Family Systems’ mark for almost eleven years and had
even discussed the similarity of the marks and negotiated a Letter of Consent with Family
Systems in 1999 (See Para .13). Yet Apple did not purchase the Family Systems’ mark until the
very day that plaintiff, John Colby, sent an e-mail to Mr. Dowling at Apple informing him of
plaintiffs’ prior use of the iBooks mark. Mr. Colby’s e-mail to Apple and the assignment of the
IBOOK mark are both dated January 29, 2010. This “coincidence” in timing can best be
explained by the fact that Family Systems’ IBOOK registration had a priority date of October 8,
1996, the date on which it was filed in the PTO as an ITU application.
I have reviewed an internal Apple invoice stating that Apple paid Family Systems
for the IBOOK trademark. See Exhibit G. After acquiring the mark, Apple made no
effort to continue the business which had reportedly been using the mark since October, 2000.
This leads to the question of why did Apple pay so much money for a trademark used in
connection with a business which they abandoned? Once Apple received actual notice of
plaintiffs’ earlier claim to the iBooks mark, there was an urgent need for them to acquire the

24

earlier priority date of Family Systems’ registration. Based upon the timing of the purchase and
the exorbitant amount paid, one is left with the clear impression that the sole motivation for
Apple’s acquisition of the IBOOK mark and registration was in an ill-fated attempt to acquire a
priority to defeat plaintiffs’ anticipated claim to the iBooks mark. While this is may be a
legitimate reason for acquiring a trademark, it calls into question whether the mark was properly
assigned.
Trademarks are a type of property and, as such, they may be bought and sold. However,
because of the unique nature of trademarks, there are specific rules which must be followed in
order for an assignment to be valid and effective. The most important of these rules is the
requirement that the goodwill associated with the mark be included in the assignment. While the
assignment language quoted in the above paragraph refers to “the goodwill of the business
pertaining thereto”, we must look beyond the document itself to see whether this requirement
was in fact met. If not, the assignment is invalid and Apple’s attempt to acquire priority will fail.
What is goodwill? Unlike most property, a trademark has no physical existence except as
it may be printed on labels and packaging or as it appears in advertisements, promotional
materials and the like. It is a symbol of the source, quality and reputation of the product on
which it is used. When a trademark is effectively transferred from one owner to another, it is not
only the symbol or trademark which is being transferred, but also the consumer recognition and
drawing power represented by that symbol. To illustrate the identifying role of a trademark, we
need only imagine entering a grocery store intending to buy ketchup and being faced with shelf
after shelf of ketchup made by several different companies... how do we know which ketchup to
buy? Fortunately, all of the ketchup bottles bear a trademark which allows the consumer to
make an informed decision. This decision is made upon seeing the Heinz label, the Hunts label,

25

the Del Monte label, the store brand label or some other brand which identifies the product and
informs the consumer of the nature and quality of the product. The consumer may choose the
Heinz ketchup simply because they have always used it and prefer this brand, they may select the
Hunt’s brand because it is what their mother always bought, or they may buy the Del Monte
brand because they like its flavor. Whatever the reason, the purchasing decision is made upon
seeing the trademark. It allows the consumer to make an informed decision which would not be
possible without this identifying symbol. The mental association or recognition created by the
trademark in the mind of the consumer is called “goodwill”. It is this recognition and brand
loyalty which makes a trademark so valuable. A leading commentator on trademark law,
Professor Thomas McCarthy, explains goodwill as follows:
“a trademark is merely a symbol of goodwill. But it is not easy to give a simple,
sweeping definition of what goodwill is. ‘Goodwill’ is not a tangible, physical
object that can be seen, felt and tasted. Its real existence is in the minds of the
buying public.”
McCarthy on Trademarks and Unfair Competition, 4th ed., Section 2:17.
Any assignment of a trademark must include the accompanying goodwill. Again quoting Prof.
McCarthy:
“Goodwill and its symbol, a trademark, are inseparable. A trademark has no
independent significance apart from the goodwill it symbolizes. If there is no
business and no goodwill, a trademark symbolizes nothing. For this reason, a
trademark cannot be sold or assigned apart from the goodwill it symbolizes.”
McCarthy on Trademarks and Unfair Competition, 4th ed., Section 2:20.
If goodwill is an intangible asset, how can we determine whether it has been assigned
with the mark? We have to look at the totality of the assignment to see whether any other
assets, such as patents, trade secrets, customer lists, specialized equipment and physical
inventory, were transferred with the mark. The reason that we look to these types of assets is
because they are often essential for the purchaser to continue the stream of business identified by

26

the mark. Upon reviewing the June 29, 2010 assignment document, it appears that only the
trademark, without the requisite accompanying goodwill, was assigned to Apple. Apple
acquired no other assets that would allow it to continue the business that had been identified by
Family Systems’ IBOOK mark for many years. Perhaps the most glaring omission was U.S.
Patent No. 6,411,993, which was discussed in Section 7. This patent protects the manufacture,
distribution and sale of the IBOOK interactive Web book system. That this patent was not
assigned is powerful evidence that Apple never intended to use the IBOOK mark on the same
goods or in the same business as its predecessor. Apple did the very thing that Prof. McCarthy
warned against.... it separated the IBOOK mark from its goodwill. A trademark assignment
without the accompanying goodwill in the mark -- an “assignment in gross” -- is an invalid
assignment which fails to transfer any rights in the mark to the buyer, including a priority of use.
Another way of determining whether the requisite goodwill remains with the mark is to
examine the assignee’s use of the mark post-transfer. As previously noted, Family Systems
used the IBOOK mark in connection with an interactive Web book system designed to allow
material to be created and shared on the Internet. It is a sophisticated system consisting of
software and several components which allows users to contribute and/or view material on the
World Wide Web. The content on the Family Systems’ IBOOK product is created and managed
by the user, it is not sold as part of the product. The purchaser is in effect buying a blank online
diary or journal onto which they can enter their own content to share with others via the Internet.
The benefit to the user is that he/she can write whatever they want via the IBOOK software and
then manage it and share it with others. The Family Systems’ IBOOK product is not, and never
was, a book or a vehicle to purchase finished books published by others.

27

One of the SAEGIS searches disclosed registrations for Family Systems’ IBOOK mark in
the European Union (covering the 27 EU member countries) and Japan. See Exhibit H. Even
though Apple is a multinational corporation with extensive worldwide distribution and sales of
its products, it appears to have made no attempt to purchase Family Systems’ IBOOK
registrations in these jurisdictions. This is yet another indication that Apple had no intention of
ever using the IBOOKS mark to continue Family Systems’ IBOOK business. Rather it once
again appears that the only reason Apple purchased the mark was in an attempt to defeat
plaintiffs’ earlier rights in the mark. This failure to continue Family Systems’ use of the IBOOK
mark, but instead to use it on a significantly different product, is further evidence of an
assignment in gross.
Apple, on the other hand, uses the IBOOKS and IBOOKSTORE marks to identify a
means of distributing previously published books in electronic form. Most everyone is familiar
with Apple’s IBOOKS and IBOOKSTORE products from its widespread advertising and
promotion. These products are described as “A novel way to buy and read books....Download
the iBooks app from the App Store. Load up on books from the iBookstore. Take them to more
places than you’d ever take a regular book.” Apple’s IBOOKS and IBOOKSTORE products
allow the user to select from a library of over 700,000 existing books and transform those books
into a more mobile, more flexible and more convenient form. While Apple’s IBOOK is a
remarkable product and has met with tremendous commercial success, it is simply another
method of marketing and distributing existing books.
A comparison of Family Systems’ use of its IBOOK mark and Apple’s use of the
IBOOKS and IBOOKSTORE marks, shows them to be very different products, with very
different uses. McCarthy on Trademarks and Unfair Competition, 4th ed., Section 18:24 states:

28

“when the purported assignee does not make products of the same quality and
nature as those made by the assignor, then the assignment is in gross and not
effective to achieve priority. “
It should also be noted that Apple not only changed the product on which they used the mark, but
they also amended the mark as well (from IBOOK to IBOOKS; see Section 9) to better fit the
“library” concept of the product.
Why is the transfer of the goodwill so important? Professor McCarthy provides the
answer:
“If one obtains a trademark through an assignment in gross, divorced from the
goodwill of the assignor, the assignee obtains the symbol, but not the reality. Any
subsequent use of the mark by the assignee may be in connection with a different
business, a different goodwill and a different type of product. The continuity of
the thing symbolized by the mark is broken. Use of the mark by the assignee in
connection with a different goodwill and different product may result in a fraud
on the purchasing public, who reasonably assume that the mark signifies the same
nature and quality of goods or services, whether used by one person or another.
The law’s requirement that goodwill always go with the trademark is a way of
insuring that the assignee’s use of the mark will not be deceptive, and will not
break the continuity of the thing symbolized by the assigned mark.”
McCarthy on Trademark and Unfair Competition, 4th ed., Section 18.3.
Given (i) the initial failure to transfer the goodwill associated with the mark as part of the
assignment and (ii) the significant change in the nature and use from the original product, the
transfer of the IBOOK mark to Apple was an assignment in gross. As such, it was an invalid
assignment which failed to transfer both the mark and the priority to Apple.
9.

APPLE’S AMENDMENT AND RENEWAL OF REGISTRATION NO. 2,446,634,
IBOOKS (AS AMENDED):
Apple’s Statements in the Declaration of Use Constituted Fraud on the PTO.
Following the recordal of the assignment of the IBOOK registration in the PTO and the

appointment of Apple’s in-house counsel as the new attorney of record, Apple filed a request to

29

amend the mark from IBOOK to IBOOKS on May 17, 2010. In making this request, Apple’s
attorney stated that:
“The proposed amendment to the mark does not materially alter the character of
the mark in the registration and 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 readily understand the mark to be the same.”
The PTO accepted this amendment to the mark so that the mark shown in Registration No.
2,446,634 now reads as IBOOKS. No other changes were made to the subject registration at that
time. It is noted that Apple’s attorney specifically stated that “consumers readily understand the
mark to be the same” as the original IBOOK mark as used by Family Systems. Unfortunately,
however, Apple not only changed the mark, but, as discussed in Section 6, contrary to counsel’s
representation to a government agency, it significantly changed the nature and use of the goods
on which the mark had been used by Family Systems.
In order to maintain a registration, the registrant must file a Declaration of Continued Use
and/or Excusable Nonuse under Section 8 of the Trademark Law and an Application for Renewal
under Section 9 of the Trademark Law during the twelve month period prior to each ten year
anniversary of the issuance of the registration. These two documents are often filed together in a
Combined Declaration. The purpose of the Section 8 filing is to remove those registered marks
which are no longer being used, sometimes referred to as “deadwood”, from the Trademark
Register. If these documents are not timely filed and accepted by the PTO, the registration will
be cancelled pursuant to Section 8 or expire pursuant to Section 9. In this case, Apple timely
filed the Combined Declaration of Use and/or Excusable Nonuse/Application for Renewal of
Registration of a Mark under Sections 8 & 9 on June 7, 2010.

30

In the Section 8 Declaration of Use, Apple stated that “the mark is in use in commerce on
or in connection with all goods or services listed in the existing registration” (emphasis in the
original). This statement of continued use of the mark is the essence of the Section 8 filing. The
list of goods in the subject registration reads: “Computer software used to support and create
interactive, user-modifiable electronic books.” The problem is that Apple was not using, and
never did use, the IBOOKS mark in connection with the goods recited in the registration. As
discussed in Section 6, Apple’s use of the IBOOKS mark on downloadable books and the
electronic transmission of streamed and downloadable books is a very different product/service
from that recited in the subject registration.
Because of these differences, Apple’s use cannot possibly support its statement of
continued use of the IBOOKS mark in Reg. No. 2,446,634. Cognizant of the differences
between the respective products, Apple still signed an official document and filed it in the PTO
stating that the IBOOKS mark was in use in connection with “computer software used to support
and create interactive, user-modifiable electronic books.” To support this statement, Apple
submitted a screenshot of its online IBOOKS bookstore. The problem with this specimen,
however, is that it shows the IBOOKS mark being used in connection with Apple’s library of
published books, not with the computer software used for creating user-modifiable books recited
in the registration. It does not support the use claimed in the Section 8 Declaration of Use.
These statements were made on June 7, 2010, pursuant to a declaration under the federal
False Claims Act and signed by Apple’s in-house attorney stating that:
“The undersigned being warned that willful false statements and the like are
punishable by fine or imprisonment, or both, under 18 U.S.C. Section 1001, and
that such willful false statements and the like may jeopardize the validity of this
document, declares that he/she is properly authorized to execute this document on
behalf of the Owner; and all statements made of his/her own knowledge are true
and that all statements made on information and belief are believed to be true.”

31

These false statements raise the question of whether they were knowingly made with the intent to
deceive the PTO into maintaining this IBOOKS registration in full force and effect so that Apple
could claim priority of use of the IBOOKS mark in defense of this lawsuit. If so, this fraud on
the PTO should result in the cancellation of Registration No. 2,446,634.
10.

TRADEMARK DISTINCTIVENESS / DESCRIPTIVENESS:
Plaintiffs’ iBooks Mark is Suggestive and Inherently Distinctive.
In selecting a new trademark, one must consider not only the availability of the mark, but

also the strength of the mark. One must determine whether the mark has any descriptive
meaning in relation to the goods on which it will be used. The strength of the mark and how it is
treated depends upon where it fits on the following spectrum (from the strongest marks to the
weakest marks):
(a) Fanciful or arbitrary marks. Fanciful marks consist of those marks which are made
up or invented words, such as EXXON, KODAK and GOOGLE, and which are created for the
exclusive purpose of functioning as trademarks. Arbitrary marks consist of existing words in the
common language, but which have no relationship to the goods on which they are used. They do
not describe or even suggest any characteristics, i.e., nature, quality, use, etc., of the goods.
Examples of arbitrary marks include SHELL for gasoline, APPLE for computers, YAHOO for
computer services and AMAZON for online retail services. Fanciful and arbitrary marks are
inherently distinctive and can function as trademarks immediately upon adoption and use in
commerce. These are the strongest and easiest marks to protect.
(b) Suggestive marks. As the name says, these marks consist of words which suggest
one or more characteristics of the goods on which they are used. Examples of suggestive marks
include MOBIL for gasoline, IVORY for white bar soap and IGLOO for coolers. These marks

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evoke, but do not actually describe, a feature or use of the goods. Suggestive marks are also
inherently distinctive and begin to serve as trademarks immediately upon adoption and use.
(c) Descriptive marks. Unlike suggestive marks, these marks are merely descriptive of a
characteristic or feature of the goods on which they are used. These characteristics may include
the purpose, use or function of the goods, the ingredients of the goods, the intended users of the
goods, or the nature or quality of the goods. It is often difficult to determine whether a mark
falls into the suggestive or descriptive category. For a mark to be descriptive, it must clearly and
directly describe a characteristic of the goods. If imagination and thought is required in order to
make a connection to the product, the mark will be deemed to be suggestive. The distinction
between descriptive and suggestive marks is important because suggestive marks are, as noted
above, inherently distinctive and can function as trademarks immediately upon adoption and use,
whereas descriptive marks must pass another “test” in order to be recognized and protected as
trademarks. Descriptive marks must have acquired distinctiveness or “secondary meaning”
before they can function as trademarks.
What is “secondary meaning” and how is it acquired? Consumers are accustomed to
seeing descriptive terms freely used in the marketplace by a variety of companies. However, if
one of those companies should begin to use, advertise and promote that term as a trademark over
an extended period of time, consumers may come to associate that term with a particular product.
This consumer association or recognition of the word as a source identifier is called “secondary
meaning”. While the original descriptive meaning of the word remains, there is now a new or
“secondary meaning”of the word. When a descriptive term has acquired secondary meaning, it
will be recognized and protected as a proprietary trademark. Rather than being just a descriptive
term, the mark now creates a mental association with a particular product from a single source.

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It is not necessary that the consumer know the identity of that source or the company behind the
product, only that the consumer recognizes the word as an identifying trademark. Secondary
meaning is acquired via use, advertising and promotion of the mark usually over a period of
years. While there is no specific length of time of use required, in the case of a massive new
product launch and advertising campaign, it may be acquired in days, but in most cases it is a
gradual process over several years. A good indicator of what is generally required is set forth in
Section 2(f) of the Lanham Act and used by the PTO when they encounter an application to
register a descriptive mark, which states that:
“The Director may accept as prima facie evidence that the mark has become
distinctive, as used on or in connection with the applicant’s goods in commerce,
proof of substantially exclusive and continuous use thereof as a mark by the
applicant in commerce for the five years before the date on which the claim of
distinctiveness is made.”(emphasis added).
(d) Generic terms. These terms consist of the actual name of the goods. For example,
terms such as “e-book” for electronic books, “auto” for a car , “mart” for a supermarket or
“guide” for a how-to book, can never function as trademarks. They must remain in the “public
domain” for everyone to use.
Where does plaintiffs’ iBooks mark fit into this spectrum of distinctiveness? Since the
generic name for plaintiffs’ goods is “e-book”, iBooks is not a generic term. Also, the fact that
the PTO has on more than one occasion granted a registration for the IBOOKS mark is further
evidence that it is not the generic name for the product.
Having determined that iBooks is not a generic term, one must turn to the question of
whether it is a suggestive or a descriptive mark. Plaintiffs’ iBooks mark does not convey an
immediate, direct and unequivocal description of the goods or of any characteristic of the goods.
It is unclear as to what “ibooks” means...... does it refer to “interactive” books, “internet” books,
“intelligent” books, “independent” books, “information” books, “imagination” books or some

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other type of “i” book? It is not immediately clear as to what the mark means. Because of this
lack of clarity, imagination, thought and perception is required in order to establish any direct
descriptive reference to the goods. This need for “mental gymnastics” means that the mark is not
merely descriptive, but suggestive and inherently distinctive.
The PTO file history of plaintiffs’ predecessor’s application to register the mark iBooks,
which was filed on August 27, 1999 (App. No. 75/786,491, see Section 12 below) provides
support for the conclusion that iBooks is not descriptive. In that application, the Trademark
Examiner refused registration on the grounds, among others, that the mark iBooks was
misdescriptive (emphasis added). If the Trademark Examiner believed the mark to be
misdescriptive, which it is not, it cannot possibly be descriptive. 4
Even if plaintiffs’ iBooks mark were to be classified as merely descriptive -- which it is
not -- it has acquired secondary meaning based upon thirteen years of substantially exclusive and
continuous use. Between 1999 when the mark was first used and June, 2002, plaintiff had
iBooks sales of more than $5,000,000, and spent more than $250,000 in advertising and
promoting the iBooks product. (See Office Action Response to the above-noted PTO refusal of
the iBooks application). Total iBooks sales to distributors for the years 2003 – 2011 exceeded
$20,000,000. See Dep. of John T. Colby, dated July 18, 2012, at 161 – 169; 186 – 190. While
sales of plaintiffs’ iBooks titles decreased following Byron Preiss’ unexpected death, sales have
been continuous since 1999, and John Colby’s company has been using the mark consistently,
selling hundreds of copies of books from the iBooks back catalog and also launching and selling
several new iBooks titles every year. Id. at 170. These numbers do not approach the massive

4

In any event, the application was abandoned before this issue could be finally resolved.

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sales and overwhelming advertising and promotional expenditures of Apple’s IBOOKS product,
but they are more than sufficient to support a finding of secondary meaning.
11.

PLAINTIFFS’ ACQUISITION OF THE iBooks TRADEMARK AND BUSINESS:
Plaintiffs’ Properly Acquired the iBooks Trademark Out of Bankruptcy.
As previously noted, the founder of the iBooks, Inc. business, Byron Preiss, died

unexpectedly in July, 2005, and despite its best efforts, the iBooks business could not financially
weather this loss and declared bankruptcy on February 22, 2006 under Chapter 7. Upon the
conclusion of the bidding and auction process, plaintiff, J. Boyleston & Company, Publishers,
LLC, purchased all of the assets of iBooks, Inc. on December 13, 2006. The “Amended Terms
and Conditions Relating to the Purchase and Sale of the Assets of Byron Preiss Visual and
Ibooks” listed all of the assets purchased by plaintiffs including, but not limited to, “Trademarks,
imprints, service marks, trade dress, logos, trade names, corporate names, and source identifiers”
belonging to Byron Preiss Visual and Ibooks. See Exhibit I.
In addition to the trademarks, plaintiffs purchased all of the assets necessary to continue
the iBooks business as it had been conducted prior to Mr. Preiss’ death. In fact, plaintiffs have
continued to publish many of the same works, plus new titles, under the iBooks trademark since
acquiring the business. As plaintiffs’ purchased the entire iBooks business and continued to
publish under the iBooks trademark post-acquisition, the mark and the associated goodwill
remained intact and were successfully transferred to the plaintiffs.
Consistent with the purchase of all of the iBooks assets, J. Boyleston & Company,
Publishers, LLC immediately filed an assumed name certificate for the name “iBooks” with the
New York Department of State. See Exhibit J. Unlike Apple, plaintiffs’ had every intention of
continuing the iBooks business as it had been conducted by Byron Preiss since 1999, and the
prompt recordal of the iBooks name is confirmation of this business plan..

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12.

iBooks Inc.’s TRADEMARKS iBooks (APPLICATION NO. 75/786,491) AND
iBookstore.com (APPLICATION NO. 75/786,490):
Although Both Applications Were Abandoned, Plaintiffs Continued to Use the iBooks
Mark.
On August 27, 1999, iBooks, Inc., filed an ITU application in the PTO to register the

mark iBooks for “books” (App. No. 75/786,491). The application was signed by Byron Preiss,
President of iBooks, Inc. The application was subsequently amended to cover “books, namely, a
series of fiction books; non-fiction books in the field of science.” Upon examination of the
application, the Trademark Examiner refused registration on the grounds that the mark is (i)
confusingly similar to two prior registered IBOOK and IBOOKS marks and (ii) misdescriptive
as used in connection with the goods recited in the application. iBooks, Inc.’s attorneys at the
time filed a response to the PTO Action, but the Trademark Examiner continued to refuse
registration and the application was abandoned in due course.
iBooks, Inc. filed a second ITU application on the same day to register the mark
iBooksinc.com for “computerized on-line ordering services in the field of printed publications”
and “providing a website on global computer networks featuring information on the field of
printed publications”. This application was also signed by Byron Preiss. The Trademark
Examiner again refused registration claiming confusingly similarity with the same IBOOK and
IBOOKS marks noted above. A second basis for refusal claimed that this mark was descriptive
of the recited Internet website services. Much the same response was filed, but it too was
rejected and the application was abandoned. Even though iBooks, Inc. failed in its attempt to
register these trademarks, plaintiff continued to use the iBooks mark and the iBooks, Inc. name
in the ordinary course of trade (See Section 5).
Wanting to see if these two marks would be found in a preliminary search, I ran a search
of the PTO’s Trademark Electronic Search System (TESS). The TESS search system was

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created by the PTO to assist trademark attorneys and others in “clearing” new or expanded
trademarks. It is available for all to use, free of charge, and it (or a similar commercial database)
should be the first place to look when trying to determine whether a proposed mark is available.
After entering the TESS website at http://tess2.uspto, selecting the search option “Word and/or
Design Mark Search (Free Form) and typing in the search query “ibook”, the search disclosed
twelve trademark records, four of which belonged to Apple. iBooks, Inc.’s iBooks and
iBooksinc.com marks were numbers 9 and 10 on the list, even though the applications had been
abandoned. These eight non-Apple owned marks should have triggered a further investigation.
Unfortunately, Apple apparently chose to disregard the preliminary search results and failed to
take the appropriate next step in clearing the IBOOKS mark.
13.

APPLE’S TRADEMARK IBOOK (REGISTRATION NO. 2,470,147):
Apple’s Original IBOOK Registration is Limited to Computer Hardware and Required
Family Systems Consent to Register.
On November 6, 1998, Apple Computer, Inc. filed an Intent to Use application (App. No.

75/584,233) in the PTO to register the trademark IBOOK for “computers, computer hardware,
computer peripherals and users manuals sold therewith.” The Trademark Examiner reviewed the
application for the mandatory information and conducted a search of the federal Trademark
Register and of pending applications for any confusingly similar marks. While the search did not
disclose any similar registered marks, it did locate an earlier filed pending application (App. No.
75/182,820) for the mark IBOOK for “computer hardware and software used to support and
create interactive, user-modifiable electronic books”, filed by Family Systems Limited.
Believing Apple’s IBOOK and Family Systems’ IBOOK marks to be potentially
confusingly similar when used on the goods recited in their respective applications, the
Trademark Examiner issued an Office Action dated June 23, 1999, suspending action on Apple’s

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application pending the disposition of Family Systems’ IBOOK mark. The Trademark Examiner
stated that if, and when, registration is granted to the earlier filed mark, it may be cited against
Apple’s IBOOK application as a bar to registration.
In its response to the Office Action, Apple drew a distinction between Apple’s IBOOK
mark for computers and Family Systems’ IBOOK mark for computer hardware and software
used to support and create interactive, user- modifiable electronic books. In support of this
acknowledgment, Apple submitted a Consent Agreement from Family Systems Limited which
recited the differences between the trade channels, stylizations and uses of the respective marks.
The Consent Agreement, for which Apple paid

(see Goldhor deposition transcript,

pages 69-70), stated, in part:
“The parties agree that their respective products and services, as defined in
Paragraphs 1 (Apple’s “notebook computers”) and 2 (Family Systems’ “computer
hardware and software used to support and create interactive, user-modifiable
electronic books”) of this Agreement are distinctively 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...”
“APPLE shall further limit its use of the mark to products and services that come
within the description in Paragraph 1 above (“notebook computers”) and will
specifically not use or attempt to register the mark IBOOK, or any mark similar
thereto, on any of the products or services coming within the description in
Paragraph 2 above (“computer hardware and software used to support and create
interactive, user-modifiable electronic books”). APPLE shall limit its registration
of the IBOOK mark or any mark similar thereto to notebook computers and
related computer hardware and peripherals used in connection with the notebook
computers and users manuals sold therewith.”
The Trademark Examiner accepted Apple’s argument and specifically relied on the statements
made in the supporting Consent Agreement and removed the application from suspension and
approved the mark for publication in the Official Gazette (“OG”). A company called Softbook
Press, Inc. requested an extension of time to oppose the IBOOK mark, but ultimately elected not
to file a Notice of Opposition.

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Accordingly, since registration of the mark was not opposed, the PTO issued a Notice of
Allowance on February 6, 2001, giving Apple six months to begin bona fide use of the IBOOK
mark in interstate commerce on “computers, computer hardware, computer peripherals and user
manuals sold therewith.” In this instance, Apple was able to file the Statement of Use on
February 21, 2001, claiming interstate use of the IBOOK mark on the recited goods beginning as
of July 21, 1999. As a specimen, Apple filed a printout of its online store where a consumer can
purchase an iBook computer. The Trademark Examiner reviewed the Statement of Use and the
accompanying specimen showing use of the mark and approved Apple’s IBOOK mark for
registration, which was granted on July 17, 2001, as Reg. No. 2,470,147.
As noted in Section 6(a), following the grant of a registration, the registrant is required to
file a Declaration of Use between the fifth and sixth anniversary of the registration date or, in
this case, between July 17, 2006 and July 17, 2007, in order to maintain the registration. The
Declaration of Use must include a statement that the registered mark is still in use on the goods
recited in the registration and a specimen showing how the mark is currently being used. Apple,
Inc. (by change of name from Apple Computer, Inc., dated January 9, 2007) filed the required
Declaration and supporting specimen on July 20, 2006. The specimen submitted with Apple’s
Declaration of Use shows the mark printed on the display bezel of an IBOOK notebook
computer.
In addition to the filing of the Declaration of Use, the owner of the registration must file a
Combined Declaration of Use and Application for Renewal of the registration at each ten year
anniversary of the registration. Failure to do so will result in the expiration of the registration.
Apple filed the requisite documents on January 17, 2012. In doing so, the goods listed in the
registration were amended by deleting the items “computers, computer peripherals and users

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manuals sold therewith”. The registration now covers only “computer hardware.” As of the date
of this report, Apple’s federal registration for the IBOOK mark, limited to computer hardware
only, remains in full force and effect.
14.

APPLE’S IBOOKS (APPLICATION NO. 85/008,412), IBOOKSTORE
(APPLICATION NO. 85/008,432) AND OTHER PREFIX “i” MARKS:
Apple’s Prefix “i” Marks are Famous Marks That are Immediately Associated with
Apple.
In April, 2010, in anticipation of its introduction of the iPad and the IBOOKS e-book

library, Apple filed ITU applications in the PTO to register the marks IBOOKS and
IBOOKSTORE for a wide variety of goods and services connected to books, including
“downloadable electronic publications in the nature of books...” (Class 9); “printed matter;
printed publications; periodicals; books...” (Class 16); “retail store services in the field of
books...” (Class 35); “electronic transmission of streamed and downloadable electronic
publications for browsing over computer networks, namely books, magazines, periodicals...”
(Class 38); and “educational and entertainment services; providing electronic books...” (emphasis
added) (As noted in Section 5, the IBOOKS application was subsequently amended to delete
Classes 16, 38 and 42 while the IBOOKSTORE application continues to seek registration in all
six of the original Classes.) It is evident from the listing of “books” throughout these applications
that Apple intends to use the IBOOKS mark in connection with books.
In reviewing the two applications, the Trademark Examiner refused registration of both
marks on the grounds that they “merely describe features and functions of applicant’s goods and
services.” In response to these refusals, Apple argued that consumers will see the IBOOKS and
IBOOKSTORE marks as members of “Apple’s family of famous marks that begin with the
prefix ‘i’“ and that they will not perceive the prefix “i” as an abbreviation for “Internet.” Apple
also argued that these marks should be allowed based upon its earlier IBOOK (Reg. No.

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2,470,147; see Section 14) and IBOOKS (Reg. No. 2,446,634; see Sections 6 and 9) registrations
both of which were found to be inherently distinctive.
The bulk of the response stressed the fame of Apple’s many “i” prefix marks, with Apple
arguing that because these brands are so widely recognized by the public, consumers will
immediately associate the IBOOKS and IBOOKSTORE marks with Apple. Apple made the
following statement:
“The IBOOK laptop, the IPOD media player, the ITUNES software and iTunes
Store service, and the IPHONE digital mobile device were all particularly
influential in cementing the public perception that the ‘i’-prefix brand is
synonymous with Apple. Each of them ranks as a landmark product offering, and
the IBOOKS mark follows in their footsteps....”
Office Action Response dated December 29, 2010 (emphasis added).
In an attempt to convince the Trademark Examiner of the fame and breadth of their
family of prefix-i marks, Apple submitted more than 400 pages of “evidence” (which in my
experience is an exceptionally large submission). These materials consist of copies of
approximately 60 active federal registrations and pending applications of Apple’s prefix-i marks,
several articles touting the tremendous success of its iPod, iTunes, and iPhone products/services,
and other articles noting that:
“Apple’s ‘i’-branding is so widely recognized that the public has come to expect
each new Apple product to follow that nomenclature.”
“in light of Apple’s longtime identification with the IBOOK mark, and its use of
the other famous ‘i’-prefix brands, consumers immediately recognize IBOOKS as
a member of Apple’s family of marks.”
An almost identical response was filed in connection with the co-pending
IBOOKSTORE application. Despite Apple’s arguments and submissions to the contrary, the
Trademark Examiner maintained and continued the descriptiveness refusals under Section

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2(e)(1) and issued a Final refusal of the IBOOKSTORE application. Apple has until October,
2012 to respond to both PTO Office Actions.
In order to show the extent of Apple’s trademark portfolio, I have prepared and attached a
Schedule of Apple, Inc.’s Prefix “i” Trademark/Service Mark Registrations and Pending
Applications as Exhibit K.
15.

OTHER INFRINGEMENT CLAIMS INVOLVING APPLE’S PREFIX “i” MARKS:
Apple has been Accused of Trademark Infringement on Numerous Occasions.
In preparing the above-referenced schedule of Apple’s prefix “i” trademarks, I reviewed

the status/history of several well-known Apple trademarks, including, iAd, iPad, iPhone and
iCloud (plus the subject of this litigation, the IBOOKS mark) and found that all of the abovelisted marks have at one time or another been the subject of trademark infringement claims
against Apple. Specifically:
(i) In January, 2007, Cisco Systems, Inc. filed a trademark infringement lawsuit
against Apple in the U.S. District Court for the Northern District of California, claiming
that Apple’s iPhone mark infringed Cisco’s IPHONE mark;
(ii) In January, 2010, Fujitsu Frontech North America, Inc. challenged Apple’s
use of the iPad mark, claiming that it conflicted with Fujitsu Frontech’s earlier iPad
mark;
(iii) In June, 2010, Innovate Media Group LLC filed a trademark infringement
lawsuit against Apple in the U.S. District Court for the Central District of California,
claiming that Apple’s iAd mark infringed Innovate Media’s iAds mark; and
(iv) In June, 2011, iCloud Communications, LLC filed a trademark infringement
lawsuit against Apple in the U.S. District Court for Arizona, claiming that Apple’s iCloud
mark infringed iCloud Communications’ iCloud mark.

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In addition to the “i” trademark claims listed above, Apple has encountered challenges to
its use of such other marks as Apple and Mighty Mouse. This recurrence of adverse trademark
claims is highly unusual and has been widely reported in the media with such comments as:
“Apple sued for trademark infringement, again.”
(www.macgasm.net/2011/6/10/apple...)
“Apple seems to have a pretty simple philosophy when it comes to announcing
new products-announce today, worry about the legalities tomorrow.”
(www.macgasm.net/2011/06/10/apple...)
“Apple has a history of naming its products first, and worrying about trademark
infringement later.” (PCWorld at www.pcworld/article/188137/ipad......)
“Trampling the rights of others’ again.” (The register, posted June 14, 2010
www.theregister.co.uk/2010/06/14/innovate_media...)
“for the most part, Apple’s announce now and deal with the legal ramifications
later approach has landed them in some hot water from time to time.”
(www.macgasm.net/2011/06/10/apple-sued;
“iPad: Just the latest Apple Trademark Dispute”
(www.pcworld.com/article/188137/ipad...).
Apple’s pattern of adopting new trademarks and, after the fact, repeatedly encountering
conflicting claims can only be the result of either shoddy clearance procedures, corporate
arrogance or a blatant disregard for the trademark rights of others’.
16.

OPINIONS.
For the reasons set forth above, it is my opinion that:
(i) Apple failed to conduct an appropriate clearance search of the IBOOKS mark
prior to its use in connection with downloadable books and the electronic transmission of
streamed and ownloadable books and thereby disregarded the trademark rights of others.
(ii) Family Systems’ assignment of the IBOOK mark and Reg. No. 2,446,634 to
Apple was an invalid assignment in gross and failed to give Apple any priority of use.

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EXHIBIT A