Already v. Nike, 133 S. Ct. 721 (2013) (Roberts; Kennedy, concurring).  For the Court’s slip opinion, click here.AlreadyNike01092013

Already addresses the rights of parties who have been initially, and allegedly improperly, charged with infringement of an intellectual property right to continue a counterattack seeking a declaratory judgment that the right is invalid even though the rights holder has provided a covenant not to sue.

Already directly involves trademarks, not patent law.  However, the Court’s analysis was clearly framed as applicable to intellectual property rights generally, including patents.  Indeed, in some respects, the Court’s language is more appropriate to patent litigation than is to trademarks.

The Court began by stating: “The question is whether a covenant not to enforce a trademark against a competitor’s existing products and any future `colorable imitations’ moots the competitor’s action to have the trademark declared invalid.”  It held that the answer to the question depends on application of the “voluntary cessation” doctrine.  Under that doctrine, a party asserting that its voluntary compliance moots a case bars a “formidable burden.”  The burden is to show that ” `it is absolutely clear the allegedly wrongful behavior could not reasonably be expected to recur.’ Friends of the Earth, Inc. v. Laidlaw Environmental Services (TOC), Inc., 528 U. S. 167, 190 (2000).”

In this case, an accused infringer asserted a claim for a declaratory judgment that a trademark owner’s mark was invalid.  The trademark owner’s “voluntary cessation” by its covenant not to sue made it absolutely clear that its alleged wrongful behavior, that is, an assertion of infringement of an allegedly invalid trademark, could not “reasonably be expected to recur.”  The covenant was broad, precluding assertions against the accused infringers’ present products and any future products that “colorably imitated” the present products.

Once the trademark owner demonstrated that the covenant broadly covered the activities giving rise to the controversy, it became incumbent on the accused infringer to indicate that it “engages in or has sufficiently concrete plans to engage in activities not covered by the covenant.”  The accused infringer did not identify (or assert that it planned to market) a product that arguably infringed but that was not covered by the covenant not to sue. Read CPLRG™ 0081