May 22, 2015

Indiana Trademark Litigation: Hard Rock Hotel Sues Alleging Infringement of Trademarked "Rehab" Pool Party

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Indianapolis, Indiana - Indiana trademark attorneys for HRHH Hotel/Casino, LLC and HRHH IP, LLC, both of Las Vegas, Nevada (collectively, "HRHH"), commenced a trademark lawsuit in the Southern District of Indiana alleging that Bella Vita, LLC, Henri B. Najem, Jr. and 10 unknown defendants, all of Indiana, infringed various trademarks belonging to HRHH.

The HRHH entities together claim ownership to the Hard Rock Hotel & Casino Las Vegas located in Las Vegas, Nevada, along with certain intellectual property rights used in connection with that establishment.

HRHH contends that it created a daytime pool party held at the Hard Rock Hotel & Casino Las Vegas known as the "Rehab Pool Party" or simply "Rehab". The Hard Rock Hotel & Casino Las Vegas indicates that the Rehab Pool Party was first held in 2004 and that the Rehab Pool Party is still being held regularly. HRHH asserts that its Rehab Pool Party has become famous and that it has licensed the REHAB marks to third parties for clothing and other merchandise.

Bella Vita, an Indianapolis provider of restaurant, bar and related entertainment services, has been accused of organizing and hosting weekly pool parties that are confusingly marketed as "Rehab+ Sundays".

This federal lawsuit has brought under trademark and anti-dilution laws of the United States, 15 U.S.C. § 1051, et seq., the trademark laws of the State of Indiana, Ind. Code § 24-2-1, and under the statutory and common law of unfair competition. The trademarks at issue, all of which have been registered by the U.S. Trademark Office, are as follows:

• Trademark Registration No. 3,873,673 REHAB
• Trademark Registration No. 4,524,097 REHAB
• Trademark Registration No. 4,611,979 REHAB RX
• Trademark Registration No. 3,182,848 Rxehab
• Trademark Registration No. 4,615,774 Rxehab

• Trademark Registration No. 3,170,859 Rxehab

In the complaint against Bella Vita, its managing member Najem and the unnamed Does, Indiana trademark lawyers for Plaintiffs assert the following causes of action:

• False Designation of Origin and Unfair Competition - 15 U.S.C § 1125(a)
• Trademark Infringement - 15 U.S.C. § 1114, Ind. Code § 24-2-1-13, and Common Law
• Dilution - 15 U.S.C. § 1125(c)

• Unfair Competition

Plaintiffs ask the court for a finding that Defendants have engaged in trademark infringement, trademark dilution and unfair competition; for injunctive relief; for a finding that HRHH is the exclusive owner of the REHAB Marks and that such marks are valid and protectable; for an award of damages and profits earned as a result of infringing activity; for punitive damages; and for an award of interest, costs, expenses, and reasonable attorneys' fees.

Continue reading "Indiana Trademark Litigation: Hard Rock Hotel Sues Alleging Infringement of Trademarked "Rehab" Pool Party" »

May 21, 2015

Committee Approves TROL Act to Squash Patent Trolls

WASHINGTON DC - The House Energy and Commerce Committee recently voted to approve H.R. 2045, the Targeting Rogue and Opaque Letters (TROL) Act, by a vote of 30 to 22. Authored by Commerce, Manufacturing, and Trade Subcommittee Chairman Michael C. Burgess, M.D. (R-TX), the TROL Act was designed to help stop the practice of abusive patent demand letters while protecting the rights of legitimate patent holders to protect their intellectual property.

The TROL Act increases transparency and accountability in patent demand letters so businesses can weed out deceptive letters. The Act also establishes a national standard for the enforcement of abusive patent demand letters and allows the Federal Trade Commission (FTC) and state attorneys general to levy fines on bad actors.

"This legislation takes on a costly scam that, by many accounts, continues to worsen," said Burgess. "The very real problem of abusive patent demand letters compels us to find a solution expressly designed to enable enforcement that's free of constitutional setbacks." To learn more about the TROL Act, click here.

This legislation is complemented by a patchwork of state legislation that was intended to accomplish similar goals. As of 2014, a significant number of states had proposed or passed measures to confront patent trolling. In 2015, Indiana HB 1102 was introduced. The Bill:

• Prohibits a person from asserting a claim of patent infringement in bad faith;
• Provides that a court may, upon motion, require a person to post a bond if the target establishes a reasonable likelihood that the person has made an assertion of patent infringement in bad faith;
• Establishes remedies and damages; and

• Exempts certain: (1) approved postsecondary educational institutions; (2) technology transfer organizations owned by or affiliated with approved postsecondary educational institutions; and (3) licensees holding patents from postsecondary educational institutions or technology transfer organizations owned by or affiliated with postsecondary educational institutions; from the provisions regarding bad faith assertions of patent infringement.

May 20, 2015

Indiana Trademark Litigation: Integrity Trade Services Sues Ex-Employees Alleging Conspiracy and Conversion

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South Bend, Indiana - Trademark attorneys for Integrity Trade Services, Inc. ("ITS") of Frankfort, Illinois filed an intellectual property complaint in the Northern District of Indiana naming as Defendants Integrity Employment Partners, LLC, Integrity Trade Services, LLC, Janice Hernandez, James Hernandez, Tiffany Heineman, Michaela Williams, and Jason Reis, all of Indiana, and alleging multiple claims, including trademark infringement, conversion of ITS trade secrets, breach of contract, and tortious interference with business relationships.

ITS is a national staffing services company, doing businesses in multiple states, including Indiana, Florida, Illinois, and Texas. ITS is wholly owned by John E. Cumbee, III. In 2008, ITS acquired all of the operational assets of the Knox, Indiana branch of a staffing company owned by CES America, Inc. ITS also hired most, if not all, of the CES employees then working at the Knox facility, including defendants James and Janice Hernandez.

ITS contends that, since purchasing the Knox facility, it has invested well over $1 million to build the Knox business and the ITS brand as it is related to that facility. It asserts in this federal lawsuit, inter alia, that Defendants conspired to convert ITS' customers, employees and trade secrets for their own use.

The accused in this case are husband and wife Janice Hernandez and James Hernandez; several family members of Janice Hernandez, including Tiffany Heineman, Michaela Williams, and Jason Reis; and two entities apparently owned by the Hernandezes, Integrity Employment Partners, LLC, Integrity Trade Services, LLC.

Defendant James Hernandez ("James") worked for ITS from the time that ITS acquired the business until April 30, 2015 when he was fired. ITS asserts that James engaged in a conspiracy to solicit away and convert (a) ITS' office employees at the Knox location, (b) at least the active ITS field employees servicing the Knox location, and (c) customers comprising the Knox-area business. He is accused of attempting to transfer them to Integrity Employment Partners, LLC, an Indiana limited liability company formed to process the Knox business converted from ITS for his benefit and the benefit of the other co-conspirators.

Defendant Janice Hernandez ("Janice"), also became employed by ITS when ITS was acquired from its prior owner. She has been accused of not only being an integral part of the alleged conspiracy but also of being "likely its "'mastermind.'" Defendant Tiffany Heineman ("Tiffany") is Janice's niece. Defendant Michaela Williams is Janice's daughter. Defendant Jason Reis is the ex-son-in-law of James and Janice, having been married to another of Janice's daughters.

ITS states that, in the last two weeks in April 2015, it discovered various anomalies in the Knox business. These anomalies alerted ITS to the activities that triggered this federal lawsuit. They included a drop off in weekly gross sales, the formation of Integrity Employment Partners, LLC ("IEP"), and checks issued by existing ITS customers made payable to IEP (and not ITS).

Defendants are accused of orchestrating a scheme to confuse ITS' customers and employees regarding with which staffing businesses using the name "Integrity" - Plaintiff's firm or Defendants' firms - those customers and employees were transacting business. In doing so, ITS contends, Defendants attempted with some success to convert ITS' business assets and relationships for Defendants' benefit. Allegations of criminal conduct by Defendants were also made. In a 48-page complaint, filed by trademark lawyers for Plaintiff, those claims and others are made:

• Count I: Federal Trademark Infringement
• Count II: Federal Unfair Competition
• Count III: Illinois Deceptive Trade Practices Act
• Count IV: Breach of Fiduciary Duty
• Count V: Breach of Tiffany's Agreement
• Count VI: Tortious Interference with Contract
• Count VII: Tortious Interference with Business Relationships
• Count VIII: Conversion
• Count IX: Computer Fraud and Abuse Act
• Count X: Uniform Trade Secrets Act
• Count XI: Civil Conspiracy
• Count XII: Unjust Enrichment

• Count XIII: Breach of Contract

Plaintiff asks the court for, inter alia, injunctive relief, compensatory damages, punitive damages, attorneys' fees, interest and costs.

Continue reading "Indiana Trademark Litigation: Integrity Trade Services Sues Ex-Employees Alleging Conspiracy and Conversion " »

May 18, 2015

Indiana Patent Litigation: Klink Trucking Sues Seaboard Asphalt for Declaration of Non-Infringement

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Fort Wayne, Indiana - Indiana patent attorneys for Klink Trucking Inc., K-Tech Specialty Coatings, Inc., BIT MAT Products of Indiana, Inc. and BIT MAT Products of Michigan, Inc. (collectively the "Klink Group"), all of Ashley, Indiana, initiated an intellectual property lawsuit in the Northern District of Indiana alleging that Seaboard Asphalt Products Company ("Seaboard Asphalt") of Baltimore, Maryland wrongly accused Klink Group of infringing Seaboard Asphalt's patented "Trackless Tack Coat," Patent No. 8,764,340, which has been issued by the U.S. Patent Office.

Seaboard Asphalt claims ownership of U.S. Patent No. 8,764,340 for a "Trackless Tack Coat" ("the '340 patent"). This patent protects an "asphalt emulsion available for high performing, trackless tack coat applications. The tack coat can be used with hot mix asphalt, warm mix asphalt or cold mix asphalt to provide a tack coat on an existing bituminous or concrete pavement surface. The tack coat can also be used for repair of potholes, utility cuts, and general pavement patching areas."

On April 28, 2015, Seaboard Asphalt contacted Klink Group. According to a document filed with the Indiana court, Seaboard Asphalt stated that it believed that Klink Group's "AE-NT Trackless Tack Coat" infringed Seaboard Asphalt's '340 patent and requested that Klink Group "discontinue production and distribution for sale of your AE-NT and all versions of Trackless Tack Coat which violate our Patent" until Klink Group and Seaboard Asphalt had entered into a licensing agreement.

This Indiana litigation arises from that assertion and request by Seaboard Asphalt. Klink Group asserts that it has no liability for infringement of the '340 patent because none of the Klink Group entities have infringed any valid and enforceable claim of the '340 patent. Plaintiffs have sued under the Declaratory Judgment Act. They ask the Indiana federal court for two declarations with respect to the patent-in-suit:

• Count I - Declaration of Non-Infringement

• Count II - Declaration of Invalidity

Plaintiffs also ask the court to declare this case to be exceptional under 35 U.S.C. § 285 and, pursuant to such a declaration, to award to Plaintiffs its reasonable attorneys' fees, expenses and costs relating to this patent litigation.

Continue reading "Indiana Patent Litigation: Klink Trucking Sues Seaboard Asphalt for Declaration of Non-Infringement " »

May 15, 2015

Congresswoman Susan Brooks of Indiana Listed as one of D.C.'s Top 50 Women in Tech

Indianapolis, Indiana - Congresswoman Susan Brooks, who represents the northern third of Indianapolis, was recently named as one of the District of Columbia's Top 50 Women in Tech. Her lawmaking focus includes legislation that will cause "our laws need to catch up with technology."

Rep. Brooks, the Republican co-chair of the Congressional High-Tech Women's Caucus, represents a burgeoning area of startups and entrepreneurship in the technology sector. In her first term, Brooks co-chaired a subcommittee focused on emergency preparedness, response and communications. Since then, she's introduced the Social Media Working Group Act, which passed the House twice, and is awaiting action in the Senate. If passed, the bill would codify the Homeland Security Department's Social Media Working Group, which meets regularly to improve the department's social media techniques. The bill would also bring representatives from academia and the private sector into the working group.

"I think our laws need to catch up with technology and some of the other things that we are also focused on," Brooks said. "Data breach notification is one of the top issues facing companies that hold personal information about our customers and our employees. We need to bring the government up to speed there, too."

Women promoting technology need to recognize and understand that there are not enough women in high-ranking technology positions, Brooks said. In response, those same female technology leaders need to open themselves to being mentors.

"The Women's High-Tech Coalition is about promoting women into high-ranking positions and organizations and then also with a focus on making sure that we are being role models and bringing more girls into the tech field," Brooks said. "I think the women who are promoting technology need to recognize that there aren't enough women in the tech industry."

Brooks ran for Congress to become that type of role model, she said.

"I realized I had an opportunity to be that role model and to encourage people to push themselves harder, to think bigger than maybe they had thought in the past about what their possibilities could be," Brooks said. "I think technology is the way we do that."

May 14, 2015

Ninth Circuit Copyright Proceedings: Prenda Law Parties Ask to be Prosecuted

San Francisco, California - A lawyer for Prenda Law argued before the United States Court of Appeals for the Ninth Circuit and was heard by Judges Harry Pregerson, Richard Tallman and Jacqueline Nguyen. The appeal focused on the rulings of U.S. District Court Judge Otis Wright II.

The intellectual property attorney representing Prenda Law, the now-infamous copyright trolling law firm, squared off with the judges of the Ninth Circuit recently. In a hearing before the appellate court, he contended that the district court had denied due process to the Prenda Law parties. He noted that Judge Wright had threatened incarceration argued and, in doing so, Judge Wright had indirectly initiated a criminal contempt proceeding.

"The entire proceeding was tainted. Mark Lutz, the CEO of Ingenuity 13, was not allowed to testify. As soon as they asserted their Fifth Amendment rights, the judge stopped the proceeding," Prenda Law's lawyer said. "He can't use that against them," he continued, arguing that Judge Wright had punished the Prenda Law parties for invoking their Fifth Amendment rights against self incrimination.

Judge Tallman countered, "Sure he can." Because this was a civil proceeding, Judge Wright was allowed to "draw adverse inferences" as a result of an invocation of the Fifth Amendment. Judge Pregerson added that the Prenda parties "should have taken the Fifth, because they were engaged in extortion. They sent out thousands of extortionate letters."

"Let's say you're right," Pregerson said. "Do you want us to send this back and have this turn into a criminal contempt proceeding?" The court was surprised when the answer was "yes."

Judge Pregerson continued: "They used our court system for illegal purposes to extort money--they used our discovery system. They bought these pornographic films, and seeded the Internet with them.... If they really want to have a trial on this, with all protections of a criminal case--burden of proof, and a prosecutor, and all the rest of it--you sure they want that?"

"I'm amazed that you are asking us to vacate the sanctions and send it back for an independent prosecutor to pursue," said Judge Nguyen added, noting that the case currently before the court was not the only matter that prosecution could include.

Judge Tallman also seemed surprised that Prenda Law had asked that the matter be considered as a criminal matter: "With a potential penalty of life in prison for criminal contempt? They're prepared to run that gauntlet?"

Prenda Law's attorney repeated that, yes, the Prenda Law parties wanted their day in court.

May 13, 2015

Patent Office Issues 173 Patents To Indiana Citizens in April 2015

The U.S. Patent Office issued the following 173 patent registrations to persons and businesses in Indiana in April 2015, based on applications filed by Indiana patent attorneys:

Patent No.  Title
D728,184 Bag holder 
D727,732 Baked goods box 
D727,713 Clip for an animal housing 
9021539 Leakage location methods 
9020878 Intelligent airfoil component surface inspection 
9020669 Hybrid vehicle driver coach 
9020262 Symbol compression using conditional entropy estimation 

Continue reading "Patent Office Issues 173 Patents To Indiana Citizens in April 2015" »

May 12, 2015

Copyright Law: U.S. Copyright Office Publishes Index of Fair Use Decisions

Washington, D.C. - Register of Copyrights Maria A. Pallante yesterday announced the launch of the U.S. Copyright Office's Fair Use Index, which is designed to provide the public with searchable summaries of major fair use decisions. The Index was undertaken in support of the 2013 Joint Strategic Plan on Intellectual Property Enforcement prepared by the U.S. Intellectual Property Enforcement Coordinator within the Executive Office of the President.

Although not a substitute for legal advice, the Index is searchable by court and subject matter and provides a helpful starting point for those wishing to better understand how the federal courts have applied the fair use doctrine to particular categories of works or types of use, for example, music, internet/digitization, or parody.

"The doctrine of fair use has been an essential aspect of our copyright law for nearly 175 years," said Pallante, "but it has too often been a mystery to good-faith users who seek more detail about its application. It has been a pleasure coordinating this practical and important resource with the U.S. Intellectual Property Coordinator's office."

"The doctrine of fair use is a vital aspect of U.S. copyright law," said Danny Marti, the U.S. Intellectual Property Enforcement Coordinator at the White House, "and it is applied regularly in our daily life. I commend Register Pallante and the Copyright Office for producing this important resource--a resource that not only helps to make the doctrine more accessible, but also serves to re-emphasize the significance of this right as part of our culture. Indeed, it is the combination of a strong copyright system with a right of fair use that encourages creativity, promotes innovation and respects our freedom of speech and expression."

The goal of the Index is to make the principles and application of fair use more accessible and understandable to the public by presenting a searchable database of court opinions, including by category and type of use (e.g., music, Internet/digitization, parody).

The Fair Use Index may be accessed on the Copyright Office's website at http://copyright.gov/fair-use/index.html or via the U.S. Intellectual Property Enforcement Coordinator's website at http://www.whitehouse.gov/omb/intellectualproperty.

May 8, 2015

155 Trademark Registrations Issued to Indiana Companies in April 2015

The U.S. Trademark Office issued the following 155 trademark registrations to persons and businesses in Indiana in April 2015 based on applications filed by Indiana trademark attorneys:

Reg. Number Word Mark Click To
View
4715442 INDIANA GRAND RACING & CASINO View
4727755 FLEXSHADE View
4727476 TPG View
4727465 SMARTPARCEL View
4727415 CHILLMODE View
4727372 BOTTLED ARTIST View
4727350 NCA View
4727073 JACOBS & BRICHFORD View
4727064 BEST WINTER HATS View
4726917 STEAM COUTURE View

Continue reading " 155 Trademark Registrations Issued to Indiana Companies in April 2015" »

May 6, 2015

Indiana Intellectual Property Litigation: J & J Sports Alleges Illegal Interception in Two New Lawsuits

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Hammond, Indiana - An intellectual property attorney for J & J Sports Productions, Inc. ("J & J Sports") of Campbell, California filed two federal lawsuits in the Northern District of Indiana, both alleging illegal interception of a cable signal for the Floyd Mayweather, Jr. v. Robert Guerrero, WBC Welterweight Championship Fight Program ("Program"). One lawsuit named Jorge Zamora, individually and d/b/a El Sombrero Bar of East Chicago, Indiana. The other lawsuit named JP & P, Corporation and Jose L. Gonzalez, individually, both d/b/a Michigan Avenue Bar and Grill of Hammond, Indiana.

J & J Sports states that it is the exclusive domestic commercial closed-circuit distributor of the Program. It has sued multiple Defendants, both individually and doing business as commercial entities, under the Communications Act of 1934 and The Cable & Television Consumer Protection and Competition Act of 1992. Specifically, Defendants have been accused of violating 47 U.S.C. § 605 and 47 U.S.C. § 553 by displaying the Program at issue on May 4, 2013 without an appropriate license. A count of conversion is also included.

Plaintiff has sued two Defendants as individuals, alleging that they had the right and ability to supervise the activities of the commercial establishments that allegedly engaged in the illegal interception. J & J Sports asserts that the activities that they supervised included the unlawful interception of Plaintiff's Program. J & J Sports contends that the individual Defendants specifically directed the employees of the restaurants to unlawfully intercept and broadcast Plaintiff's Program at the commercial establishments or, if they did not, that the actions of the employees of the restaurants are directly imputable to the Defendants sued as individuals by virtue of their purported responsibility for the activities of their respective restaurants. In the second lawsuit, a corporate Defendant has also been sued. This lawsuit also lists "Loida Chavarria as a Defendant in paragraph 10, although she has not been listed as a Defendant in the caption of the complaint.

In both of these interception complaints, the intellectual property attorney for J & J Sports listed the following counts:

• Count I: Violation of Title 47 U.S.C. § 605
• Count II: Violation of Title 47 U.S.C. § 553

• Count III: Conversion

J & J Sports asks for damages, as well as costs and attorneys' fees.

Continue reading "Indiana Intellectual Property Litigation: J & J Sports Alleges Illegal Interception in Two New Lawsuits" »

May 1, 2015

Appellate Patent Law: Federal Circuit Affirms that Prior Art was Anticipatory

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Washington, D.C. - The United States Court of Appeals for the Federal Circuit heard an appeal in the matter of Ineos USA LLC v. Berry Plastics Corporation. It affirmed the decision reached by the United States District Court for the Southern District of Texas, Case No. 3:13-cv-00017, regarding the infringement of Patent No. 6,846,863 (the "'863 patent), which was issued by the U.S. Patent and Trademark Office.

Ineos holds the '863 patent, which was directed to polyethylene-based compositions which could be used to form shaped products, such as screw caps for bottles. In a patent lawsuit filed in Texas, Ineos accused Berry Plastics of infringing its '863 patent.

Berry Plastics moved for summary judgment that the asserted claims were anticipated independently by various prior art references, including U.S. Patent No. 5,948,846. Prior art incorporated a lubricant to allow the cap to glide better, which facilitated unscrewing the cap. However, in addition to increasing usability, the prior chemical formulations also imparted a bad odor and flavor to food products stored in contact with them. Ineos' '863 patent claimed to have solved this problem by modifying the proportions of polyethylene, lubricants, and additives.

The district court ruled in Berry Plastic's favor, holding that the '863 patent was invalid as anticipated by prior art under 35 U.S.C. § 102 (2006).

Ineos appealed from the district court's ruling. The Federal Circuit affirmed, holding that Ineos had failed to show that the range claimed by the '863 patent was "critical to the operability of [Ineos'] invention."

Continue reading "Appellate Patent Law: Federal Circuit Affirms that Prior Art was Anticipatory" »

April 30, 2015

Supreme Court Holds TTAB Decision Can Have Issue Preclusion Effect

The Supreme Court on March 24, 2015, held that a Trademark Trial and Appeal Board (TTAB) decision should be given issue preclusion effect when the usages it adjudicated are materially the same as those before a district court. B&B Hardware, Inc. v. Hargis Industries, Inc., U.S., No. 13-352, 3/24/2015.

Reversing an Eighth Circuit decision, the Court found no categorical reason why issue preclusion can never apply. The same likelihood of confusion standard applies for both registration and infringement, Justice Alito explained, even if the TTAB and the district court do not always consider the same usages. A concurring opinion was filed by Justice Ginsburg, who stressed that preclusion will not apply for a great many TTAB decisions. Justice Thomas (joined by Justice Scalia) dissented, objecting to the presumption of preclusion for adjudicating agencies. The Court's decision is consistent with the position taken in an AIPLA amicus brief filed in this case.

Background

This litigation concerns alleged infringement of B&B's registered mark "Sealtight" for fastener products largely used in the aerospace industry. Hargis attempted to register its "Sealtite" mark for fasteners used in the construction trade, but its application was refused based on the B&B registration, which Hargis then attempted to cancel. The TTAB refused to cancel the registration, finding B&B's registration incontestable, and it subsequently sustained B&B's opposition to Hargis's attempted registration of "Sealtite."

In a district court action, however, a jury found the B&B mark to be merely descriptive, and the district court refused to defer to the TTAB decision.

The Eighth Circuit affirmed the district court decision. The simple fact that both the TTAB's registration decision and the district court's infringement decision addressed the concept of "likelihood of confusion" does not mean they addressed the same issue, according to the court.

Administrative Preclusion

Writing for the Supreme Court majority, Justice Alito first made clear that issue preclusion is not limited to situations where the same issue is before two courts, pointing out that preclusion also often applies where a single issue is before a court and an administrative agency. He quoted Astoria Fed. Sav. & Loan Assn. v. Solimino, 501 U. S. 104 (1991), that "courts may take it as given that Congress has legislated with the expectation that the principle [of issue preclusion] will apply except when a statutory purpose to the contrary is evident." The Court said a presumption of administrative preclusion is also supported by United States v. Utah Constr. & Mining Co., 384 U. S. 394 (1966), and by the Restatement (Second) of Judgments.

Constitutional Issues

The Court was not persuaded that TTAB preclusion raised concerns over the Seventh Amendment right to a jury trial and the separation of executive and judicial powers. The jury issue was not raised below, and the constitutionality of TTAB preclusion is not before the Court, Justice Alito observed.

Specifically, the Court stated that, under Parklane Hosiery Co. v. Shore, 439 U. S. 322 (1979), the right to a jury trial does not negate issue preclusion, even if the judgment in question was entered by a juryless tribunal. Moreover, in 1791, a party had no right to a jury determination of issues previously adjudicated by a chancellor in equity, Justice Alito added.

Congressional Intent

The Court also found no "evident" reason why Congress would object to giving preclusive effect to TTAB decisions. Neither the text nor the structure of the Lanham Act forbids issue preclusion, and nothing can be inferred about Congressional intent from the availability of de novo district court review of TTAB decisions, Justice Alito wrote. If a party to a court proceeding fails to challenge an adverse decision, that decision can have preclusive effect in other cases, even if it would have been reviewed de novo, he explained.

While the Astoria decision found no issue preclusion, Justice Alito pointed out that this case is different in that Astoria involved a plaintiff that exhausted administrative remedies and sued in court about the same alleged conduct. The concern there was that issue preclusion could render the judicial action "strictly pro forma." By contrast, the party here in district court was not seeking review of the TTAB registration decision, and the TTAB proceeding was not a prerequisite to the infringement action.

No Categorical Reason Against TTAB Preclusion

Finally, the Court was unable to find a categorical reason why TTAB registration decisions can never meet the ordinary elements of issue preclusion. Even if the TTAB and district courts consider different factors, the same likelihood-of-confusion standard applies to both registration and infringement. Justice Alito explained as follows:

To begin with, it does not matter that registration and infringement are governed by different statutory provisions. Often a single standard is placed in different statutes; that does not foreclose issue preclusion. * * * Neither does it matter that the TTAB and the Eighth Circuit use different factors to assess likelihood of confusion. For one thing, the factors are not fundamentally different, and "[m]inor variations in the application of what is in essence the same legal standard do not defeat preclusion." * * * More important, if federal law provides a single standard, parties cannot escape preclusion simply by litigating anew in tribunals that apply that one standard differently. A contrary rule would encourage the very evils that issue preclusion helps to prevent.

The real question, therefore, is whether likelihood of confusion for purposes of registration is the same standard as likelihood of confusion for purposes of infringement. We conclude it is, for at least three reasons. First, the operative language is essentially the same; the fact that the registration provision separates "likely" from "to cause confusion, or to cause mistake, or to deceive" does not change that reality. * * * Second, the likelihood-of-confusion language that Congress used in these Lanham Act provisions has been central to trademark registration since at least 1881. * * * That could hardly have been by accident. And third, district courts can cancel registrations during infringement litigation, just as they can adjudicate infringement in suits seeking judicial review of registration decisions. * * * There is no reason to think that the same district judge in the same case should apply two separate standards of likelihood of confusion.

The Court conceded that the TTAB is concerned with whether marks "resemble" each other, and that infringement is concerned with "use in commerce." However, to give a categorical effect to this difference would mistake a "reason not to apply issue preclusion" with a "reason never to apply issue preclusion." Justice Alito wrote the following:

Just because the TTAB does not always consider the same usages as a district court does, it does not follow that the Board applies a different standard to the usages it does consider. If a mark owner uses its mark in ways that are materially the same as the usages included in its registration application, then the TTAB is deciding the same likelihood-of-confusion issue as a district court in infringement litigation. By contrast, if a mark owner uses its mark in ways that are materially unlike the usages in its application, then the TTAB is not deciding the same issue. Thus, if the TTAB does not consider the marketplace usage of the parties' marks, the TTAB's decision should "have no later preclusive effect in a suit where actual usage in the marketplace is the paramount issue." 6 McCarthy §32:101, at 32-246.

Materiality is an essential consideration, the Court continued, since trivial variations between usages cannot create different issues. It is of no consequence that the TTAB may place more weight on certain factors than it should, Justice Alito said, since that that is an occasion for judicial review.

Finally, the Court concluded that procedural differences in TTAB and district courts (such as the absence of live witnesses and limitations on discovery at the TTAB) by themselves do not defeat preclusion. The correct inquiry for issue preclusion is whether the first proceeding was poor, cursory or unfair, Justice Alito observed, and no one has given a "categorical reason" to doubt the quality, extensiveness or fairness of the TTAB proceedings. 
 
The Eighth Circuit decision was reversed and remanded.

Concurring and Dissenting Opinions

In her concurring opinion, Justice Ginsburg said the Court rightly recognizes that issue preclusion will not apply for a great many registration decisions.

In his dissenting opinion, Justice Thomas (joined by Justice Scalia) objected to the majority's application of a presumption of administrative preclusion in this case. He contended that the presumption is based solely on dictum in Astoria where preclusion was denied, and that history undercuts the suggestion that administrative preclusion was widely accepted at common law.

To read the opinions in this case, click here.

April 29, 2015

Indiana Patent Litigation: Eli Lilly Again in Federal Court Asserting Patent Infringement

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Indianapolis, Indiana - An Indiana patent lawyer for Eli Lilly and Company of Indianapolis, Indiana; Daiichi Sankyo Co., Ltd. of Tokyo, Japan; Daiichi Sankyo, Inc. of Parsippany, New Jersey; and Ube Industries, Ltd of Yamaguchi, Japan (collectively "Lilly") sued in the Southern District of Indiana alleging that Lupin Ltd. of Mumbai, India and Lupin Pharmaceuticals, Inc. of Baltimore, Maryland infringed Patent Nos. 8,569,325, titled Method of Treatment with Coadministration of Aspirin and Prasugrel and 8,404,703, titled Medicinal Compositions Containing Aspirin, which have been issued by the U.S. Patent Office.

This lawsuit adds another two new Defendants, Lupin Ltd. and Lupin Pharmaceuticals, Inc. (collectively "Lupin"), to Lilly's Indiana patent litigation efforts. In these "Effient" patent-infringement lawsuits, the Lilly group of Plaintiffs alleges infringement of its pharmaceutical product Effient. The patents at issue in the Lupin litigation are Effient-related patents 8,404,703 "Medicinal Compositions Containing Aspirin," (the "'703 patent") and 8,569,325 "Method of Treatment with Coadministration of Aspirin and Prasugrel" (the "'325 patent").

This complaint asserts patent infringement arising out of the filing by Lupin of an Abbreviated New Drug Applications ("ANDA") with the United States Food and Drug Administration ("FDA") seeking approval to manufacture and sell generic versions of two pharmaceutical products - Effient 5mg and Effient 10mg tablets - prior to the expiration of the '703 patent and the '325 patent. These patents cover two Effient products and/or methods of using Effient products and for which Lilly claims an exclusively license.

Effient products were approved by the FDA for the reduction of thrombotic cardiovascular events in certain patients with acute coronary syndrome (ACS) who are to be managed with percutaneous coronary intervention (PCI, or angioplasty). Effient products contain prasugrel hydrochloride, which is also known as 5-[(1RS)-2-cyclopropyl-1-(2-fluorophenyl)-2-oxoethyl]-4,5,6,7-tetrahydrothieno[3,2-c]pyridin-2-yl acetate hydrochloride or 2-acetoxy-5-(alpha-cyclopropylcarbonyl-2-fluorobenzy1)-4,5,6,7-tetrahydrothieno[3,2-c]pyridine hydrochloride, and is covered by the '726 patent.

The instructions accompanying Effient products state that patients taking Effient products should also take aspirin. The use of Effient products in combination with aspirin for the reduction of thrombotic cardiovascular events in patients with ACS who are to be managed with PCI is allegedly covered by the claims of the '703 and '325 patents.

Lupin is accused of planning to infringe the patents-in-suit by including with its products instructions for use that substantially copy the instructions for Effient products, including instructions for administering Lupin's products with aspirin as claimed in the '703 and '325 patents.

Plaintiffs contend that Lupin knows that the instructions that Lupin intends to include with its products will induce and/or contribute to others using those products in the allegedly infringing manner set forth in the instructions. Moreover, the Lilly Plaintiffs also contend that Lupin specifically intends for health care providers, and/or patients to use Lupin's products in accordance with the instructions provided by Lupin and that such use will directly infringe one or more claims of the '703 and '325 patents. Thus, state Plaintiffs, Lupin's actions will actively induce and/or contribute to infringement of the '703 and '325 patents.

The complaint, filed by an Indiana patent attorney, lists four counts:

• Count I: Infringement of U.S. Patent No. 8,404,703
• Count II: Declaratory Judgment of Infringement of U.S. Patent No. 8,404,703
• Count III: Infringement of U.S. Patent No. 8,569,325

• Count IV: Declaratory Judgment of Infringement of U.S. Patent No. 8,569,325

Plaintiffs ask the court for judgment:

• That Lupin has infringed the '703 patent and/or will infringe, actively induce infringement of, and/or contribute to infringement by others of one or more claims of the '703 patent;

• That Lupin has infringed the '325 patent and/or will infringe, actively induce infringement of, and/or contribute to infringement by others of one or more claims of the '325 patent;

• That, pursuant to 35 U.S.C. § 271(e)(4)(B), Lupin be permanently enjoined from making, using, selling or offering to sell any of its accused products within the United States, or, where applicable, importing accused products into the United States prior to the expiration of the '703 and '325 patents;

• That, pursuant to 35 U.S.C. § 271(e)(4)(A), the effective date of any approval of the Lupin ANDA under § 505(j) of the Federal Food, Drug and Cosmetic Act (21 U.S.C. § 355(j)) shall not be earlier than the later of the expiration dates of the '703 and '325 patents, including any extensions;

• If Lupin commercially makes, uses, sells or offers to sell any accused product within the United States, or, where applicable, imports any accused product into the United States, prior to the expiration of either of the '703 and '325 patents, including any extensions, that Plaintiffs be awarded monetary damages for those infringing acts to the fullest extent allowed by law and be awarded prejudgment interest based on those monetary damages;

• That the case be deemed exceptional under 35 U.S.C. § 285;

• That the '703 patent remains valid and enforceable;

• That the '325 patent remains valid and enforceable; and

• That Plaintiffs be awarded reasonable attorney's fees, costs and expenses.

Continue reading "Indiana Patent Litigation: Eli Lilly Again in Federal Court Asserting Patent Infringement" »

April 28, 2015

Indiana Copyright Litigation: Magistrate Rejects Malibu Media's Request for Fees and Sanctions

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Indianapolis, Indiana - Magistrate Judge Mark J. Dinsmore recommended that Judge William T. Lawrence deny Malibu Media's motion for fees and sanctions against two Defendants and copyright lawyer Jonathan Phillips.

This Indiana federal lawsuit involves allegations of the use of BitTorrent to illegally download copyrighted adult films. Plaintiff Malibu Media, LLC of Malibu, California initiated copyright litigation in the Southern District of Indiana alleging that Charles and Kelley Tashiro, husband and wife, violated its intellectual property rights by downloading copyrighted videos without authorization.

On the morning of a scheduled evidentiary hearing in the matter, attorney Phillips, who at the time represented both husband and wife, learned of Mr. Tashiro's intent to invoke his Fifth Amendment rights to avoid testifying about certain matters. The defense attorney for the Tashiros advised the court that, as a result, a conflict of interest between husband and wife had arisen and that he would be withdrawing as the defense attorney for Mr. Tashiro. As a result, the court postponed that day's hearing.

Malibu Media subsequently filed a motion asking the court for sanctions, seeking to hold Mr. Tashiro and his copyright attorney jointly and severally liable for the costs and fees incurred in its preparations for the postponed hearing. Malibu Media contended that the defense lawyer's failure to recognize the conflict of interest between the two Defendants in a timely manner had required Malibu Media to incur unnecessary expenses for the evidentiary hearing. More specifically, Malibu Media contended that it incurred several thousand dollars in unnecessary fees, travel expenses, and other costs. It sought to recover those fees, expenses, and costs 1) under Federal Rule of Civil Procedure 37; 2) under 28 U.S.C. § 1927; 3) through an exercise of the court's inherent authority; and 4) under Federal Rule of Civil Procedure 16.

Magistrate Judge Dinsmore first concluded that FRCP 37 was inapplicable, as it was generally appropriate for "disputes or misconduct during discovery" and the delay of the evidentiary hearing had not resulted from discovery misconduct.

Plaintiff's claim under 28 U.S.C. § 1927 was also rejected. That section provides that the court may order costs, expenses, and attorneys' fees incurred as a result of an attorney's unreasonable or vexatious expansion of the proceedings in litigation.

Malibu Media asserted that this section applied because the copyright attorney's failure to timely recognize a conflict of interest between the husband-and-wife Defendants failed to meet the standard of care required of attorneys. The court disagreed, stating that the case had involved no incompatibility of the copyright Defendants' positions, as both had steadfastly asserted that neither had infringed any of Malibu Media's copyrighted material and that no evidence had been destroyed. Consequently, the defense attorney's belief that he could provide concurrent representation to both Defendants was neither unreasonable nor vexatious and, thus, relief under 28 U.S.C. § 1927 was unavailable.

Moreover, the court explained, even had § 1927 applied, it provided recompense only for the excess costs and fees incurred - those that would not have been otherwise necessary. Because much of the material prepared by intellectual property counsel for Malibu Media would likely prove useful later in the litigation, those costs and fees had not been incurred unnecessarily.

Magistrate Judge Dinsmore also rejected Malibu Media's argument that the court should sanction Mr. Tashiro and the defense attorney under the inherent authority that the court holds to manage its affairs through the sanctioning of a party that has abused the judicial process. The court had already determined during its analysis under § 1927 that the defense attorney had acted neither unreasonably nor vexatiously. Thus, a sanction against the defense attorney for abuse of process was similarly found to be improper. The court also declined to hold that Mr. Tashiro's decision to invoke his Fifth Amendment rights was an abuse of judicial process.

The court then addressed Malibu Media's contention that Federal Rule of Civil Procedure 16 authorized sanctions in this case. It concluded that, as the rule authorized the imposition of sanctions only in matters regarding scheduling conferences or other pre-trial conferences, it did not apply to the evidentiary hearing at issue in this request for sanctions.

Finally, Magistrate Judge Dinsmore recommended to Judge Lawrence that Malibu Media's motion, which had been filed without the required statement showing that Plaintiff's attorney made reasonable efforts to confer with opposing counsel prior to filing the motion for sanctions, be denied for failure to comply with Local Rule 7-1(g).

Continue reading "Indiana Copyright Litigation: Magistrate Rejects Malibu Media's Request for Fees and Sanctions" »

April 24, 2015

USPTO Offers New Tool to Receive Email Alerts When Patent Applications Publish

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Washington, D.C. - The U.S. Patent and Trademark Office ("USPTO") recently announced the release of the Patent Application Alert Service. This system provides customized email alerts to the public for free when patent applications of interest are published. Additionally, the system offers direct access to the published applications that meet users' search criteria.

After receipt of these customized email alerts, the public may identify prior art for "pre-issuance" submission into these applications. The pre-issuance submission process was established under the America Invents Act and, to date, the Office has received more than 2,600 submissions across all technologies. More information on the pre-issuance submission program and how members of the public can participate can be found here.

The idea for the patent application alert service came from a public roundtable held at the USPTO in April 2014 where the USPTO solicited input regarding the use of crowdsourcing and pre-issuance submissions to identify relevant prior art. The USPTO expects that this new service may be used to enhance the quality of examination and issued patents.