calling the bluff

The International Laser Class Association finally responded to Bruce Kirby’s bluff yesterday, and things are going to get pretty ugly after this.  As if they already weren’t!

To summarize the situation for those of you that haven’t followed some of the contentious and information-filled threads on the subject, here’s the basic facts:

Kirby designed the Laser, licensed or sold the design to a builder, and claims he regained ownership of the design rights when the builder went bankrupt.  Subsequently, he licensed the design to another company, which eventually was acquired by entrepreneur and baby-stroller multimillionaire manufacturer Farzed Rastegar, who renamed the company LaserPerformance.  At least one other company is licensed to build the Laser.

Rastegar quit paying Kirby royalties years ago, and Kirby launched an ambitious lawsuit last month claiming the failure to pay royalties gives him the right to terminate his agreement with LP, the right to prevent Laser Performance to build Lasers, and the right to collect damages from ILCA and ISAF for issuing ISAF plaques for the boats LP produces (without which, they are not legal).

Concurrently with the lawsuit, Kirby announced he was licensing his design to a boatbuilder who would be building the boats formerly called Lasers and launching them as Torches.  In other words, the 84 year-old Canadian designer, convinced of his moral and legal correctness, walked up to ISAF and the ILCA with the legal equivalent of a shotgun, and told them he would pull the trigger if they didn’t give in.

And today, they dared him to pull the trigger when announcing that the ILCA membership had voted to allow ILCA to approve any builder with the right to use the Trademark “Laser”, and that ILCA would be renegotiating directly with ISAF regarding their future agreement. In other words, they’ve cut out the designer completely – do not pass go, do not collect 200 Euro.

ISAF said there will be no shortage of Lasers for the World Cup events or the Olympics; as far as they are concerned, Kirby is out and life is simple again.  Do they think he’ll just go away?

A search of the USPTO and corporate data shows an awfully big mess in everyone’s laps, but the root of the problem is this:  Bruce Kirby doesn’t really own anything that is required to build, sail, or sell a Laser.  Any ‘design patent’ he may have had on the actual boat design has long since expired, while design copyrights for boats are not really available in a form that would help Kirby in any country we can find.  And if he doesn’t have the right, he can’t license the right.  And if he can’t license the right, any contract allowing him to license the right would, in most places, be void or unenforceable as a matter of law.  It would be like Sam signing an agreement with John to sell water to John for 1$ per gallon.  When John figures out that Sam is trying to sell water from a public drinking fountain, John tells him ‘go eat a dick.’  John sues.

The problem is that Laser Performance’s right to use the trademarked term “Laser” might not be much better; there’s a strong argument that it’s become generic (like Kleenex and Xerox nearly did) through lack of enforcement and dilution, and that it was incorrectly transferred in the first place.    It’s an unfortunate reality of the US Patent and Trademark Office and its equivalents in Canada, Australia, and probably the rest of the world:  Only some of the millions and millions of patents and trademarks granted by the government are actually valid, but the only way to find out which is which is to litigate.  Laser may win the battle (against Kirby) but lose the war…you just never know how courts will rule when you walk in the courthouse door.  Then again, this could have all been a hail mary; what 84 year-old guy wants to start on a 5-year, half-million or more dollar litigation trail for a complicated trademark/design/contract case?

If you’re serious about Lasers or you’re a first-year lawyer looking for a research project, read the full thread if you haven’t yet.  It includes the lawsuit, the exhibits, and much more.