November 2025 FZLZ Minute

USA

Second Circuit affirms $900,000 attorneys' fee award against attorneys who pursued unreasonable trademark infringement case. Balestriere Fariello v. Gimlet Media, Inc., No. 24-2155 (2d Cir. Oct. 15, 2025).

In 2015, Reply All Corp., which owned a Registration for REPLYALL for "Computer services, namely, creating an on-line community for registered users to form groups and create publicly viewable conversations where group members are the only individuals who can contribute to the conversation" in Class 42, brought a trademark action against Gimlet Media, LLC, which used the mark REPLY ALL for a podcast. The district court granted summary judgment dismissing the complaint and the Second Circuit affirmed. Gimlet Media then moved for attorney's fees and the district court awarded $1,071,981, of which ReplyAll was solely responsible for $168,944.21, and ReplyAll and its counsel, Balestriere Fariello, were jointly and severally liable for the remaining $903,036.79.

Balestriere Fariello appealed to the Second Circuit, which on October 15, 2025, affirmed the fee award. The Second Circuit said ReplyAll was entitled to fees under Section 35(a) of the Lanham Act, 15 U.S.C. § 1117(a), which provides that "a court 'may award reasonable attorney's fees to the prevailing party" in "exceptional cases." The court cited the Supreme Court in Octane Fitness, LLC v. ICON Health & Fitness, Inc.,572 U.S. 545, 554 (2014), which held, "an 'exceptional' case is simply one that stands out from others with respect to the substantive strength of a party's litigating position (considering both the governing law and the facts of the case) or the unreasonable manner in which the case was litigated."

The Second Circuit agreed that ReplyAll's position was objectively unreasonable: "noneof the eight factors used to evaluate trademark infringement claims favored ReplyAll." Further, ReplyAll offered only "scant anecdotal evidence" that "Gimlet's mark caused any actual consumer confusion, and it could not establish that the two parties' products had any meaningful competitive proximity."

Further, ReplyAll negotiated "in bad faith with the sole aim of extracting a settlement." ReplyAll "offered a series of unsubstantiated damages estimates ranging from $4 to $60 million, despite also 'at one point offer[ing] to license their trademark for $1.00 per year.'"

Finally, the Court held that the district court did not abuse its discretion in entering the award against ReplyAll's lawyers. Under 28 U.S.C. § 1927, courts may require an attorney "who so multiplies the proceedings in any case unreasonably and vexatiously to satisfy personally the excess costs, expenses, and attorneys' fees reasonably incurred because of such conduct." The appeals court held that the district court had adequately supported the "bad faith" finding because the defendant had 1) asserted "objectively unreasonable and frivolous claims"; 2) "attempted to extort a nuisance settlement"; and 3) "multiplied the proceedings and forced Gimlet to expend significant resources" litigating the case for "several years."

Because the District Court "could not feasibly 'determine the respective degrees of culpability" between ReplyAll and its lawyers, it properly found them jointly and severally liable for the period during which Balestriere Fariello was ReplyAll's counsel.

Takeaway: Plaintiffs in trademark cases who go too far in policing their marks can face harsh consequences, as can counsel who too zealously represent a client.

The Second Circuit decision can be found here.

DATA PRIVACY

Washington State – Getting Into the Weed: Cannabis Retailers Take a Hit Under Washington's My Health My Data Act

On November 6, 2025, a putative class action complaint was filed against three Seattle-based cannabis retailers for alleged privacy violations under, among other statutes, Washington's My Health My Data Act ("MHMDA"). Plaintiffs in K.R. et al. v. 1400 23^rd LLC, et al. (2:25-cv-02211, W.D. Wash. Nov. 6, 2025) allege that the shared website of three defendant companies, operating under the common name "Uncle Ike's," enabled unauthorized disclosure to third parties of personal health data related to marijuana product purchases and medical marijuana card appointment scheduling. The defendants shared this information via pixels and other tracking technologies.

Plaintiffs specifically refer in the complaint to Google and its vast collection of online tracking tools, which allegedly operated on defendants' website to collect sensitive, health-related data about web pages visited, areas of websites clicked, purchases made, appointments scheduled, and other details that consumers did not know were being tracked and shared. Uncle Ike's website privacy notice allegedly failed to disclose the specifics of this transmission of personal data gathered throughout consumers' website visits, in contrast to statements in the privacy policy assuring website visitors that their sensitive personal data would be kept private.

Washington enacted the MHMDA in 2023 to expand the protection of health-related data that was not otherwise protected under the federal Health Insurance Portability and Accountability Act ("HIPAA"). The statute protects Washington residents against the unauthorized disclosure of "consumer health data," defined as "personal information that is linked or reasonably linkable to a consumer and that identifies the consumer's past, present, or future physical or mental health status." This definition is supplemented by numerous specifics and serves to capture a wide range of health-related data, far beyond HIPAA-covered data, that many companies routinely process, even companies not specifically focused on health. Companies that conduct business in Washington or produce or provide products or services targeted to consumers in Washington are considered "regulated entities" under the statute, subject to limited exceptions and qualifications.

To bring a claim under MHMDA, plaintiffs must demonstrate that they have suffered a "harm to business or property." Plaintiffs in this action allege "numerous injuries," including invasion of medical privacy, a reduction in the value of their sensitive information, and continued and ongoing risk to their sensitive information.

For now, we have only the recently filed allegations as a warning for what may lie ahead with MHMDA claims based on pixel tracking. The district court will create meaningful precedent whatever conclusion it draws from plaintiffs' allegations of harm under the statute. And if the court accepts such claims and allows the matter to proceed, this may embolden and guide additional MHMDA plaintiffs in industries less sensational than marijuana sales.

Pending further developments in this matter, any company that either operates a website or app that involves health-related products or services, discloses medical or health related content, or facilitates scheduling medical appointments, should evaluate the following:

• Whether any personal data it processes falls under the MHMDA's definition of "consumer health data."
• Whether its website contains any third-party pixels, cookies, or other tracking technologies, and if such technologies are used to disclose sensitive health information.
• Whether its consumer-facing website privacy notice aligns with its actual data processing practices and contains sufficient disclosures about how personal data is shared with or sold to third parties.
• Whether its processing of health-related data triggers the statutory requirement of a separate Washington MHMDA privacy notice on its website or app.
• The use of software development kits (SDKs) in the company's mobile app, if it has one, since SDKs typically operate like pixels and cookies on a website.
• Obtaining required consent or authorizations before health-related data is disclosed to third parties through tracking technologies, especially for targeted advertising or building consumer profiles.

Takeaway: Washington's My Health My Data Act serves to protect sensitive health data that is not covered by HIPAA, thus capturing a wide range of data that may surprise companies operating in health-tangential areas. While the disposition of this class action focusing on cannabis retailers using pixels remains to be seen, companies subject to the statute must ensure that their consumer-facing policies adequately and accurately disclose their handling of sensitive health data and that they obtain required consents before collecting or sharing such data through third-party tracking technologies.

INTERNATIONAL

Brazil – Significant changes in the Brazilian Trademark System

Secondary meaning:As of November 28, 2025, registration of inherently non-distinctive marks will now be allowed if applicants effectively demonstrate secondary meaning (also known as acquired distinctiveness). Secondary meaning requests must be made at filing, within 60 days of publication, on appeal of a non-distinctiveness refusal, or as a defense in oppositions or administrative nullity actions that are based on lack of distinctiveness.There is an exceptional 12-month window, until November 28, 2026, for applicants to file secondary-meaning requests for pending applications or registrations that are currently under administrative nullity actions fighting non-distinctiveness issues. See Ordinance No. 15/2025 here.

Slogans: The TMO has abandoned its strict interpretation refusing slogans based on "expressions used only as a means of advertising"and now allows slogans to be registered as trademarks unless they are commonly used, merely descriptive, laudatory, or lacking originality. This interpretation became effective on November 27, 2024.

Fast-track prosecution: A new pilot program (limited to 1,200 applications) now provides fast-track examination for trademark applications meeting certain public-interest priority criteria (e.g., applications for unregistered trademarks used as grounds in oppositions based on prior use, and marks that are the subject of pending litigation). The pilot program, which began on August 7, 2025 runs through December 7, 2025.

Simplified opposition based on prior trademark rights:Starting on December 20, 2025, opposers may file simplified oppositions by only listing up to five prior marks per class without submitting arguments or documents.

Highly renowned marks: Effective August 7, 2025, the TMO set new thresholds for the recognition of "highly renowned marks," namely those that deserve protection nationwide and across all classes of goods and services. To secure this powerful tool against dilution, an applicant must initiate a special TMO proceeding, based on survey evidence with a minimum sample size of 2000 respondents. Recognition above 71% in a market survey is sufficient to establish highly renowned status with no further evidence, while surveys showing 61-71% recognition will require additional supporting evidence.We note that this type of protection is separate from a party's ability to rely on "well-known" status based on Article 6 bis of the Paris Convention, which provides protection only in the specific field of activity for which a mark is well known (whether registered or not). There is no standalone procedure for establishing well-known status; rather, it may be asserted in administrative and/or judicial proceedings.

Fees:Since June 14, 2025, filing and registration fees have been merged into a single fee.

Takeaway: The Brazilian TMO's amendments are expected to provide brand owners additional and quicker paths to registration and enforcement and should result in more predictable outcomes. Applicants and registrants should take note of these changes and the relevant time periods.

Germany, United Kingdom – Landmark AI/Copyright Cases – Different Outcomes – Which way will the wind blow?

Germany – GEMA v. Open AI: GEMA, a music collecting society, alleged that OpenAI had engaged in unauthorized use of copyrighted song lyrics to train the large language models (LLMs) that power ChatGPT. ChatGPT's LLM, GEMA argued, had "memorized" its lyrics and was reproducing them in response to user queries. GEMA asserted this conduct constituted copyright infringement. The court agreed that simple prompts did cause ChatGPT to reproduce original lyrics almost verbatim. The court found infringement in the reproduction of lyrics both in the training phase and in the chatbot outputs. It rejected OpenAI's argument that its LLMs did not store or copy training data and that text generated by user prompts wasbeyond its control. Nor did the court accept OpenAI's argument that the reproduction of the subject lyrics fell within the data-mining exception under Articles 3 and 4 of EU Directive 2019/790 (implemented in the German Copyright Act), concluding that the memorization of the lyrics exceeded the parameters permitted under the exemption.

UK – Getty Images v. Stability AI: Getty, a photo licensing company, sued Stability AI, which offers open-source generative AI services. Getty claimed that Stability's deep learning AI model, which was released in 2022 and Stability AI's premier product, infringed Getty's copyright-protected, licensed content. Most of the 205-page judgment addressed the trademark infringement claims, where the court ruled partially in favor of Getty. Getty dropped its primary copyright infringement claim, which concerned use of copyrighted material for training AI models, leaving the court to focus on the issue of secondary infringement. The court concluded, after undertaking a detailed analysis of how the AI product was built, that the product did not store actual copies of the at-issue material and did not constitute an unauthorized "copy" of the data it was trained on. The court ruled for Stability AI, though it left open the question of whether using copyrighted material for training models is legal.

Takeaways: One wonders whether these two decisions, decided a week apart, reached disparate results merely due to different facts or due to the different legal systems at work. Perhaps a bit of both. They do appear to represent different understandings of LLM technology. But time will tell which way the wind will blow in each jurisdiction. Stay tuned to learn if and when such decisions reach "higher authorities."

A press release issued in the GEMA case by the Presiding Judge of the Munich Regional Court (unofficial English translation) may be found here. The German-language decision may be found here. The UK decision may be found here.

Maldives – From Cautionary to Statutory – Get ready and stay tuned!

August 21, 2025, saw the official ratification of the Maldives Intellectual Property Office (MIPO) (Act No. 13/2025), which will take effect on January 1, 2026. MIPO will be responsible for trademarks, patents, industrial designs, and copyrights and is currently developing procedures, fee schedules, and formal application documentation. The legislation is expected to get underway by mid-2026. The Act's basic provisions include a ten-year term for trademark registration (renewable for 10-year terms), procedures for examination and dispute resolution (including for opposition and cancellation), a three-consecutive-year user period, as well as enforcement mechanisms. Already a member of WIPO and the Paris Convention, Maldives officially acceded on August 22, 2025, to the Berne Convention (effective November 22, 2025).

Takeaway: Given the upcoming timing for full implementation of the new Act, trademark owners should now take stock of their portfolios, assess coverage needs, and prepare to file as soon as it becomes possible. All basic information about the marks of interest should be ready, including applicant coordinates and legal entity documentation, goods and services to be covered (based on Nice Classification), high-resolution images of any figurative marks, priority documents (if applicable) and Power of Attorney (once the MIPO form is available). We are monitoring the status of this welcome development and stand ready to assist as soon as filing is available.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.