HF 2996

as introduced - 87th Legislature (2011 - 2012) Posted on 04/05/2012 09:27am

A bill for an act
relating to trademarks; enacting the Minnesota Small Business Trademark
Protection Act; providing for a dispute settlement conference; amending
Minnesota Statutes 2010, section 333.18, by adding subdivisions; proposing
coding for new law in Minnesota Statutes, chapter 333.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2010, section 333.18, is amended by adding a
subdivision to read:

new text begin Subd. 9. new text end

new text begin Trademark bullying. new text end

new text begin "Trademark bullying" as used in sections 333.18
to 333.31 means the practice of a trademark holder using litigation tactics in an attempt
to enforce trademark rights beyond a reasonable interpretation of the scope of the rights
granted to the trademark holder.
new text end

Sec. 2.

Minnesota Statutes 2010, section 333.18, is amended by adding a subdivision
to read:

new text begin Subd. 10. new text end

new text begin Trademark dispute. new text end

new text begin "Trademark dispute" means a dispute that arises
under sections 333.28 and 333.285, or the Federal Lanham Act, United States Code, title
15, sections 1051 et seq.
new text end

Sec. 3.

Minnesota Statutes 2010, section 333.18, is amended by adding a subdivision
to read:

new text begin Subd. 11. new text end

new text begin Administrative law judge summary. new text end

new text begin "Administrative law judge
summary" has the meaning given in section 333.283.
new text end

Sec. 4.

new text begin [333.283] TRADEMARK DISPUTE SETTLEMENT CONFERENCE.
new text end

new text begin Subdivision 1. new text end

new text begin Settlement conference. new text end

new text begin Each party named in a trademark dispute
has the option to request a settlement conference through the Minnesota Office of
Administrative Hearings as provided in subdivisions 2 to 7. Upon the request of any party
to a trademark dispute, the Office of Administrative Hearings shall conduct a trademark
settlement conference using the procedures provided in this section and Minnesota Rules,
part 1400.6550. A settlement conference permitted under this section is not available
after suit has been commenced by any party.
new text end

new text begin Subd. 2. new text end

new text begin Purpose. new text end

new text begin A settlement conference is for the primary purpose of assisting
the parties in resolving disputes and for the secondary purpose of identifying and labeling
cases of trademark bullying between companies.
new text end

new text begin Subd. 3. new text end

new text begin Scheduling. new text end

new text begin Upon request of any party or the initially assigned
administrative law judge, the chief judge shall assign the case to another judge for the
purpose of conducting a settlement conference. The conference shall be conducted at a
time and place agreeable to all parties and the judge, but not to exceed 30 days from the
initial date of request by the named party. It shall be conducted by telephone if any party
would be required to travel more than 50 miles to attend, unless that party agrees to travel
to the location set for the conference. If a telephone conference is scheduled, the parties
must be available by phone at the time of the conference. The conference shall not exceed
eight hours unless all parties and the judge agree there is good cause for a continuance.
new text end

new text begin Subd. 4. new text end

new text begin Procedures at conference. new text end

new text begin All parties shall attend or be represented at a
settlement conference. Parties or their representatives attending a settlement conference
shall be prepared to participate in meaningful settlement discussions.
new text end

new text begin Subd. 5. new text end

new text begin Pre-conference discussions. new text end

new text begin The parties shall discuss the possibility
of settlement before a settlement conference if they believe that a reasonable basis for
settlement exists.
new text end

new text begin Subd. 6. new text end

new text begin Information provided. new text end

new text begin At the settlement conference, the parties shall be
prepared to provide the information and to discuss all matters pertaining to the trademark
dispute. At its own cost, any party may provide information included but not limited to
expert testimony, industry practice standards, and evidence of trademark use in commerce.
new text end

new text begin Subd. 7. new text end

new text begin Orders. new text end

new text begin If, following the settlement conference, a settlement has not
been reached but the parties have reached an agreement on any fact or other issue, the
administrative law judge presiding over the settlement conference shall issue an order
confirming and approving, if necessary, those matters agreed upon. The order is binding
on any Minnesota state district court judge who is later assigned to hear a related civil
action involving substantially the same issues and parties.
new text end

new text begin Subd. 8. new text end

new text begin Administrative law judge summary. new text end

new text begin If no settlement has been reached at
the settlement conference, any party may request the issuance of an administrative law
judge summary. The judge may issue an administrative law judge summary without the
request of any party if the judge believes that the claim brought is a case of trademark
bullying.
new text end

new text begin Subd. 9. new text end

new text begin Penalty. new text end

new text begin If the party alleging trademark infringement refuses to participate
in the settlement conference as described in this section, that party is liable for a fine of
$1,500 and the attorney fees, costs, and disbursements incurred by the party holding
the disputed trademark.
new text end

new text begin Subd. 10. new text end

new text begin Remedies; treble damages; involuntary dissolution. new text end

new text begin (a) If, after
penalties are assessed under subdivision 9, the party holding the disputed trademark
prevails in subsequent litigation regarding the dispute, and a Minnesota state district
court has found the case to be one of trademark bullying, the Minnesota state district
court may award treble damages.
new text end

new text begin (b) If a party is found by a Minnesota state district court or the Office of
Administrative Hearings to have engaged in trademark bullying more than two times
in a period of ten years:
new text end

new text begin (1) and the party is a domestic business entity, the Minnesota state district court may
direct the secretary of state to issue a certificate of dissolution of that domestic entity under
the statutory dissolution procedure that applies to that type of domestic business entity.
new text end

new text begin (2) and the party is a foreign business entity, the Minnesota state district court
may direct the secretary of state to revoke the entity's certificate of authority to transact
business in this state under the statutory revocation procedure that applies to that type of
foreign business entity.
new text end

new text begin Subd. 11. new text end

new text begin Cost. new text end

new text begin The plaintiff and defendant must split the cost of the settlement
conference equally, unless the judge orders otherwise.
new text end

new text begin Subd. 12. new text end

new text begin Cease-and-desist letter requirement. new text end

new text begin All trademark cease-and-desist
letters sent to a Minnesota entity by an entity with a presence in Minnesota must contain
the following language in 12-point font clearly displayed at the beginning or end of the
letter:
new text end

new text begin "Right of Settlement Conference. All parties named in this letter may exercise
their right to a settlement conference regarding this dispute under Minnesota Statutes,
section 333.283."
new text end

Sec. 5. new text begin EFFECTIVE DATE.
new text end

new text begin This act is effective August 1, 2012, and applies to disputes evidenced by
cease-and-desist letters and similar communications sent on or after that date.
new text end