Coates IP
What are some of the biggest challenges that Coates IP has faced over the past 12 months, and how has the firm stepped up to meet them?
Steven Coates (SC): Team growth is our biggest challenge. We have an amazing team of professionals and highly competitive rates because we keep overhead very low. There is not really another practice that has a stable of ex-Big Law, ex-big brand in-house folks with our experience. It is the main reason we have had tremendous growth in such a short time. However, when waves of new work come in, it is hard to scale with the team’s growth. There simply are not many of us out there that have this same skillset, who are entrepreneurial enough to leave their sweet in-house gig and create their own practice in a small firm. To maintain our culture and diverse experience, we must grow slowly or have growing pains!
Allisen Pawlenty (AP): We are highly leveraged in the tech space. It has been a bumpy ride for many of our friends and clients over the past 12 months, and in many ways, we have been on that ride with them. We are constantly being asked to do more with less and answer questions like: “What happens if I don’t take your advice?” Luckily, with our in-house backgrounds, we have experience in driving results on lean budgets and providing frank but pragmatic counsel when the business pushes back. We have seen many of our relationships strengthen in the past year as we have buckled down for the ride.
What steps are Coates IP taking to improve hiring processes to increase DEI in the workplace?
SC: We have found that when you seek diverse experiences and skillsets in your legal recruits, the candidates are also diverse. In terms of gender, we are a primarily woman-owned business – 80% of our team are women. Our Mexico City team might be the first all-female IP practice in Latin America. Half of our team is ethnically diverse. We did this all without a policy; we had a team meeting, where I asked whether we should adopt a DEI policy. The answer was a resounding ‘no’, because the team feels like we already strike the right balance organically in our hiring.
AP: While we do not have a formal policy, we have been purposeful when it comes to hiring, training and professional opportunities. We knew that we wanted Bibiana Agudelo to be the head of our Latin American practice and we wanted to empower her to hand-select her all-female team. While we do a good amount of pounding the pavement (ie, conference attendance, speaking engagements and client pitches) we also strive to provide opportunities for the entire team to engage in development activities and have front-line client contact and responsibilities.
Trademark pendency has increased significantly in the United States recently. Have filing rates taken a hit, and what strategies has the firm developed to deal with this?
SC: When we file trademark applications for our small start-up clients, I joke that you will not hear from us until next year. Quite often, it is true. It takes about nine months for the USPTO to even pick up a file, which feels like five years in the fast-moving tech world. By the time the mark registers, some of our clients’ businesses have changed dramatically. Most of the time, the delays are not an issue. However, in a world where registrations are required for takedown notices, Amazon Brand Registry enrolment and customs recordals, we take a global and pragmatic view. EU and UK filings are being passed to publication in mere days, which can often suffice the client’s needs. I also remind myself we are in good company. The Canadian trademark office has a backlog of two-and-a-half to three years!
AP: We are also seeing a strong uptick in trademark application refusals across the board – whether for perceived descriptiveness, likelihood of confusion or some other issue (eg, software specimens). It feels like the goalie is so overwhelmed that the USPTO made the target smaller to reduce the number of shots on target. Of course, the USPTO’s examiners are also feeling this pain, so when dealing with the office, we strive to be concise and collaborative. We have had several big wins working with the examiner directly, by phone or email, to push our clients’ applications through.
What are the main challenges currently facing your clients, and how are you helping to overcome them?
SC: A question we receive nearly every week is: “What does platform liability look like in a world that is creating new apps, services and content through AI?” The answers are complicated by the fact the content is being made, stored and distributed in many different countries, and the legal landscape is moving quickly overseas (ie, Singapore already has regulations enacted) but not in the United States. What happens if social media users could create AI-generated media, distribute it through the service and monetise it? The potential to infringe (even unwittingly) is huge. Copyright damages and litigation costs are disproportionately high in the United States, and our law is notoriously slow. Still, our federal courts have historically favoured new technology and allowed platforms to avail themselves of liability within certain limits. We guide our clients through these issues by analogy to the ‘new technologies’ of the past and gathering information on the laws as they develop around the world. We will likely see that, but it is going to take many years before we see certainty in the law.
In a volatile economic climate, what advice do you have for anyone looking to provide more and better services with a constrained budget?
SC: Our firm is uniquely positioned to help clients through the turbulence, as nearly everyone in the firm has sat in the in-house seat. The biggest advantage in-house counsel have over law firm attorneys is that we know what onboarding risk is on a daily basis. Sure, firm litigators address what happens when onboarding risk goes awry, but in-house attorneys make tens of thousands of judgements and decisions that went just fine, many of them onboarding considerable risk. When there is no law or the law is grey, law-firm attorneys help guide their clients, but in-house lawyers have to live with the ramifications. You make decisions on what not to do and decide what does not matter, all while on a budget constraint and moving very, very quickly. We help our clients by drawing upon that experience and guiding them on the things they do not have to action, what can wait, what does not matter and how to pivot.
AP: We are also small and primarily virtual, meaning we are not bogged down by expensive real estate obligations. Because of this, we are able to charge very competitive rates for our services and have attracted many companies looking to grow their trademark portfolios along with us.
What are some of the firm’s proudest achievements from the past year?
SC: We have had some amazing legal achievements, but honestly, I am so proud of our team and roster of clients. My wife Alli joined the partnership, so the firm is quite literally a family business. Bibiana Agudelo joined us to establish our office in Mexico City and instead of acquiring an established practice as most firms do, we trained everyone from the ground up and hired an all-female team. They have the same creative and pragmatic approach that we have in the United States, and with an in-house perspective. Our clients are also genuinely amazing people, each and every one of them. They all pass the ‘two beers and a puppy’ test, which means that I like someone enough that I would share a couple of beers with them and trust them to take care of my puppy!
Many are looking to the United States to set standards for platform liability for infringing and counterfeit goods. What impact do you expect the country’s actions to have in this area in the next 12 months?
SC: We do not expect much to change in the legal landscape. Prior attempts have been made, but lobbying efforts have been very effective at rendering them toothless. This is what happened to the Shop Safe Act. I was an early adopter of Amazon (first purchase in 1996), but when more than half my purchases were either counterfeit or shoddy, I just stopped buying from them and moved elsewhere. Amazon’s Brand Registry programme does not seem to have moved the needle, despite the metrics they provide about how many infringements they remove. I suspect real change will not occur until consumers vote with their wallets and make platforms change.
There is a general trend for IP counsel getting more heavily involved with data issues. What advice do you have for those trying to incorporate this new work stream into their practices?
SC: At least in the tech space, trademark counsel are frequently wearing a ‘product counsel’ hat, which is a tech-specific name for a business attorney that navigates all the issues of a given technology product. Trademark counsel often manage domain names, marketing, rights of publicity and trade dress, among others. Technology products utilise all of these and our input is helpful. For example, I had a client launch a social drone at the Cannes Lion Festival. To assist them, I needed to stretch my wings a bit; I needed to know the regulatory issues for flying a drone in France, what right-of-privacy issues I would face in France and the countries where that content was streaming and the data was stored. How would we obtain consent to use people’s likenesses at an event where we did not control the ticketing? Can we put that content into a broadcast commercial later? This is not the typical job of trademark counsel. It is impossible to intimately know the body of law for each and every project that arrives at your desk, and a referral to a different attorney does not help. There is no social media, French law and drone expert in one. My advice is to be incredibly curious, soak up a little bit of information about a lot of different things so that you can spot issues, research and navigate the client.
What impact are global events (ie, the pandemic and economic crises) having on how you work with the USPTO?
SC: The global events that are affecting the office these days tend to be corporate. Amazon’s Brand Registry requires trademark filings to enrol, and so we have seen vast numbers of Chinese applicants filing questionable filings: unpronounceable marks and some with fraudulent specimens of use. Some of these applicants take the names of well-known brands and file them for unrelated products, or they will add additional letters to the front and back of a famous mark. These cases can be frustrating as they are not properly represented, they do not answer correspondence and it requires our clients to go through the expense to oppose, with the applicant invariably defaulting.