BILL ANALYSIS                                                                                                                                                                                                    Ó



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          CONCURRENCE IN SENATE AMENDMENTS


          AB  
          2249 (Cooley, et al.)


          As Amended  August 18, 2016


          Majority vote


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          |ASSEMBLY:  |80-0  |(June 2, 2016) |SENATE: | 39-0 | (August 23,     |
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          Original Committee Reference:  W., P., & W.


          SUMMARY:  Enacts the California Heritage Protection Act, which  
          prohibits a concession contract from providing a contracting  
          party with a trademark interest in the name or names associated  
          with a state park.


          The Senate amendments:


          1)Clarify that the provision of this bill that prohibits a state  
            park concession contract from providing the contracting party  
            with a trademark or service mark interest in the name or names  
            associated with a state park, and prohibits such a contract  
            from forming the basis for any legal claim to such an  
            interest, does not constitute a change in but is declaratory  
            of existing law.










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          2)Clarify that the provision of this bill that declares a  
            contract that violates the above prohibition to be void and  
            unenforceable is effective commencing January 1, 2017.


          3)Narrow the provision of this bill which makes a concessionaire  
            who files an application for a trademark or service mark in  
            association with a state park liable for the state's  
            attorney's fees, applicable only if the filing is in bad  
            faith.


          4)Add co-authors and technical language to avoid chaptering out  
            problems with SB 1473 (Committee on Natural Resources and  
            Water) in the event both bills pass and amend the same code  
            section.


          EXISTING LAW: 


          1)Authorizes the Department of Parks & Recreation (DPR) to enter  
            into contracts for the operation of concessions within units  
            of the state park system.  Requires, with specified  
            exceptions, that concession contracts be awarded to the best  
            responsible bidder.  Defines best responsible bidder as the  
            bidder who, as determined by the DPR, will operate the  
            concession consistent with the contract, in a manner fully  
            compatible with and complimentary to the characteristics,  
            features, and theme of the park unit, and in the best  
            interests of the state and public.


          2)Alternatively, authorizes the DPR, if the director of the DPR  
            determines it is in the best interests of the state, and after  
            giving notice to the State Park & Recreation Commission, to  
            award concession contracts to the best responsible person or  
            entity submitting a proposal for a concession contract in  
            response to a request for proposal.  Defines best responsible  
            person or entity as the person or entity that, as determined  
            by specific standards established by the DPR, will operate the  
            concession in the best interests of the state and the public.








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          3)Requires any proposed concession contract that is expected to  
            involve a total investment or annual gross sales of over  
            $1,000,000 to be reviewed by the State Park & Recreation  
            Commission, and submitted to the Joint Legislative Budget  
            Committee for review at least 30 days prior to advertising for  
            bids.


          FISCAL EFFECT:  According to the Senate Appropriations  
          Committee:


          1)One-time costs of $50,000 to $150,000 (General Fund) to the  
            California Department of Parks and Recreation (CDPR) to  
            develop regulations.

          2)Unknown, potentially significant costs, to ensure compliance  
            with anti-trademarking provisions and to provide required  
            appeals process, if requested.

          3)Unknown cost for potential litigation for contested contract  
            awards.


          COMMENTS:  This bill prohibits a state park concession contract  
          from providing, or serving as the basis for, any claim of a  
          trademark right in the name or names associated with a state  
          park.  The Senate amendments are technical and clarifying.


          This bill clarifies that a concession contract in a state park  
          does not entitle a company to any legal claim of a trademark,  
          prohibits concessionaires from claiming ownership of a name  
          associated with a California state park, and disqualifies a  
          concessionaire from consideration for future contracts if they  
          assert a trademark claim in violation of this bill's provisions,  
          or are found by a court to have asserted such a claim without  
          reasonable cause and in bad faith.  This bill's impact rests on  
          the premise that a state park concessionaire's business is  
          incompatible with a trademark or claim of ownership of park  








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          facilities, for which they have been entrusted as a steward, but  
          which still remain the property of the state.  


          This bill was sparked by a recent contract dispute involving  
          Yosemite National Park.  For the last 23 years, the Delaware  
          North Company was the concessionaire operating visitor services  
          and facilities within Yosemite National Park under a contract  
          with the National Park Service.  In 2015 the National Park  
          Service rebid the contract and awarded a new 15 year concession  
          contract to Aramark who was the successful bidder.  After  
          Delaware North lost the contract they sued the federal  
          government for breach of an implied contract and other alleged  
          bidding issues.  They also asserted they were entitled to  
          compensation for various trademarks and other intellectual  
          property rights they had registered while they were the  
          concessionaire in Yosemite.  


          In order to prevent a similar situation from occurring in  
          California state parks, this bill would prohibit a state park  
          concession contract from providing, or forming the basis for, a  
          trademark or service mark interest in the name or names  
          associated with a state park.  This bill would also make any  
          bidder who asserts such a legal claim ineligible to be awarded a  
          contract.


          The contract currently used by the DPR for state park  
          concessions in California expressly prohibits a concessionaire  
          from obtaining a trademark claim in any name or logo associated  
          with a state park, and provides that any such trademark that  
          might be created during the period of the contract shall  
          continue in the DPR's exclusive ownership upon termination of  
          the contract.  While this is the current practice at the DPR,  
          this bill would ensure that such protections continue to apply  
          in the future.


          Analysis Prepared by:                                             
                          Diane Colborn / W., P., & W. / (916) 319-2096     
                                                                  FN:  








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