March 14, 2014

Meeting on Notice and Takedown System to be Held

Washington, D.C. - A public meeting to focus on improving the operation of the notice and takedown system under the DMCA will be held on March 20, 2014.

DOC Picture.bmpThe U.S. Department of Commerce's Internet Policy Task Force ("IPTF") will hold the first meeting of the public multistakeholder forum on improving the operation of the notice and takedown system for removing infringing content from the Internet under the Digital Millennium Copyright Act ("DMCA") at the United States Patent and Trademark Office ("USPTO") headquarters in Alexandria, Virginia. The meeting was called for in the Commerce Department's Green Paper on Copyright Policy, Creativity, and Innovation in the Digital Economy released last year. The IPTF is a joint effort between the USPTO and the National Telecommunications and Information Administration ("NTIA").

The goal of the multistakeholder forum is to identify best practices and/or produce voluntary agreements for improving the operation of the DMCA notice and takedown system. The IPTF plans to hold several additional meetings throughout the year. The initial meeting will focus on identifying concrete topics to be addressed by participants, and to discuss and make decisions about the process for the forum's ongoing work. The IPTF aims to have participation from a wide variety of the notice and takedown system's current users, including right holders and individual creators, service providers, and any other stakeholders that are directly affected - such as consumer and public interest representatives, technical and engineering experts, and companies in the business of identifying infringing content.

Issued in July 2013, the Green Paper represents the most thorough and comprehensive analysis of digital copyright policy issued by any administration since 1995. To help produce the Green Paper, the USPTO and NTIA held more than a dozen listening sessions with interested stakeholders, convened a symposium, received hundreds of public comments, and reviewed comments submitted to other agencies on relevant topics.

The meeting will be open to members of the public on a first-come, first-served basis. The meeting will also be webcast at The agenda for the meeting will be available approximately one week prior to the meeting on the Internet Policy Task Force website ( and the USPTO website ( Additional information including RSVP instructions and directions can be found at in the Federal Register Notice:

For further information regarding the meeting, contact Hollis Robinson or Darren Pogoda, Office of Policy and International Affairs, at (571) 272-9300, or or

March 13, 2014

Indiana Court of Appeals Finds Noncompetition Agreement Overly Broad and Unenforceable

Indianapolis, Indiana - The Court of Appeals of Indiana has affirmed the decision of the Crone-picture.jpgMarion Superior Court to deny injunctive relief to Clark's Sales & Service, Inc. ("Clark's") of Indianapolis, Indiana in its suit against John D. Smith ("Smith") of Indiana and Ferguson Enterprises, Inc. ("Ferguson") of Newport News, Virginia.

In 1998, Smith began working for Clark's, a company that sells and services appliances in the builder-distributor market in Indiana. In 2004, after one of Clark's high-level managers left for a competitive position at another company, Clark's had Smith and various other employees sign a written employment agreement containing both a confidentiality clause and a noncompetition agreement.

Smith resigned his position at Clark's on April 13, 2012 but, before doing so, he took copies of Clark's sales records from 2010 and 2011, including customer and builder contact information, the price of materials sold and the costs and profit margins of Clark's. On April 18, 2012, he accepted an offer of employment with Ferguson, a nearby competitor. In his new position, he solicited business from various customers of Clark's.

Indiana attorneys for Clark's sued to enforce the confidentiality and noncompetition provisions of the agreement entered into with Smith. The trial court concluded that the restrictive covenant that Clark's drafted was overly broad and unreasonable, and denied Clark's motion for a preliminary injunction. From that order, this interlocutory appeal was brought.

On appeal, Clark's challenged the trial court's ruling, calling it clearly erroneous. It claimed that the noncompetition agreement was not unreasonable and unenforceable. Clark's also argued that, even if the noncompetition agreement were unreasonable and unenforceable as written, the court should apply the "blue-pencil doctrine" to make whatever modifications were necessary to render the covenant reasonable and enforceable.

The Indiana appellate court first discussed whether Clark's had a legitimate and protectable interest, defined as "some reason why it would be unfair to allow the employee to compete with the former employer." Indiana courts have held that "the advantageous familiarity and personal contact which employees derive from dealing with an employer's customers are elements of an employer's 'good will' and are a protectible interest which may justify a restraint." The appellate court held that, while the trial court had not explicitly stated that it had found such a protectable interest, such a finding was implicit in its ruling. The appellate court ruled that the trial court had not erred by determining that Clark's had established this element.

The Indiana appellate court then evaluated the reasonableness of the restrictions. Both parties agreed that the two-year limit was reasonable and valid. They disagreed, however, regarding the reasonableness of the noncompetition agreement as to the scope of activities and Barnes-picture.jpggeographic area restricted.

The appellate court held that the one type of activities prohibited - Clark's restrictions against contact with any of its past or prospective customers - was vague and too broad. The agreement also prohibited not merely those activities which Smith had engaged in during his tenure at Clark's, but also prohibited him from providing any services competitive to "those offered by" Clark's. That provision was held to be "overly broad, onerous, and an undue restriction on Smith's economic freedom" and, thus, unenforceable.

The restrictions placed on the geographic area in which Smith could work were also evaluated. Those restrictions included working "in any state in which Gregg [Smith's previous employer] does business, as well as working for any other entity providing services competitive to Clark's in Marion County, any county contiguous to Marion County, any county in Indiana in which Clark's has at least one customer, the State of Indiana, or within a fifty-mile radius of Smith's principal office with Clark's, which was in Castleton." The appellate court held that it was "unquestionable that the expansive geographic scope . . . is unreasonable as written."

Finally, the court addressed the "blue-pencil doctrine." This doctrine allows a court to strike unreasonable restrictions in a covenant not to compete, provided that they are divisible. However, this doctrine does not extend to allow a court to create a reasonable restriction, as this would subject the parties to an agreement that they have not made.

The court held that blue pencil doctrine was inapplicable, as the terms that Clark's proposed be stricken had been written as merely a small part of an indiscrete whole. Moreover, it held that, even if it were to strike the text that Clark's had proposed be stricken, the restrictions would still be overly broad and in excess of what would be required to protect Clark's legitimate business interest.

The Indiana appellate court affirmed the trial court, holding that its judgment was not clearly Pyle-Picture.jpgerroneous.

Practice Tip #1: To demonstrate the reasonableness of a noncompetition agreement, the employer must first show that it has a legitimate interest to be protected by the agreement. The employer also bears the burden of showing that the agreement is reasonable in terms of the time, activities, and geographic area restricted.

Practice Tip #2: Covenants not to compete are in restraint of trade and are not favored by the law. If a court applying Indiana law finds that portions of a noncompetition agreement are unreasonable, it may not modify the restrictions to make them reasonable. Doing so would subject the parties to an agreement they had not made. The court may, however, employ the "blue pencil" rule to "cross out" portions deemed unreasonable while leaving any separable and reasonable portions intact.

Practice Tip #3: This is at least the second time that the Indiana Court of Appeals has heard an interlocutory appeal on this non-compete litigation. In a prior appeal, the Court of Appeals reversed the trial court, which had improperly concluded that the noncompetition agreement failed for lack of consideration. We blogged about that appeal here.

Practice Tip #4: While Appellant-Plaintiff here argued that broad drafting was permissible and simply a "good faith effort to provide itself the greatest level of protection allowed by law," the Indiana appellate court did not agree. Instead, it called the practice "unsavory" and reminded Clark's that "Indiana law strongly discourages employers' attempts to draft unreasonably broad and oppressive covenants."

Continue reading "Indiana Court of Appeals Finds Noncompetition Agreement Overly Broad and Unenforceable " »

March 12, 2014

Supreme Court Reverses Federal Circuit on Burden of Proof in Patent Infringement Litigation Brought Under the Declaratory Judgment Act

Washington, D.C. - An issue in the patent infringement dispute between medical-device giant Medtronic, Inc. and Mirowski Family Ventures, LLC ("Mirowski") was heard by the United USSCPicture.bmpStates Supreme Court. In question was the placement of the burden of proof in patent infringement litigation that seeks a declaratory judgment. The Supreme Court reversed the U.S. Court of Appeals for the Federal Circuit, holding that the burden of proof of infringement rests with the patent holder even if the lawsuit is filed under the Declaratory Judgment Act.

After hearing arguments by patent attorneys for each side, the district court had held that Mirowski, the party asserting infringement, had the burden of proving patent infringement; it found that Mirowski had not met that burden.

The Federal Circuit reversed. It concluded that, when a patentee (Mirowski) is a declaratory judgment defendant and is also prevented from asserting an infringement counterclaim by the existence of a license between the parties - as Mirowski was - the party seeking the declaratory judgment (Medtronic) bears the burden of proving that it had not infringed the patent.

The Supreme Court granted certiorari. The question before the Court was "whether the burden of proof shifts when the patentee is a defendant in a declaratory judgment action, and the plaintiff (the potential infringer) seeks a judgment that he does not infringe the patent."

Mirowski argued that it would be unfair to place a burden of proof on the party that was not seeking relief. The Intellectual Property Owners Association supported Mirowski's position, contending that a failure to shift the burden of proof in such cases would lead to abuse of declaratory judgment actions, as the risks and burdens of patent infringement litigation would be placed entirely on the patent owner.

In contrast, Medtronic argued that placing the burden on a licensee would create an unacceptable choice between finality and fairness, as it would require the judicial system to permit a party to relitigate issues that had been previously decided under a different burden of proof.

The Supreme Court reversed the shifted burden of proof imposed by the Federal Circuit. The Court declared that it saw "no convincing reason why burden of proof law should favor the patentee" simply because it was filed under the Declaratory Judgment Act.

Practice Tip #1: It is settled law that, in patent infringement litigation, a patentee normally bears the burden of proof. Because 1) the operation of the Declaratory Judgment Act is only procedural and leaves substantive rights unchanged and 2) the burden of proof is a substantive aspect of a claim, this holding by the Supreme Court is not unanticipated.

Practice Tip #2: When drafting the terms of a license, patent owners should consider adding provisions to deter potential challenges by licensees.

Practice Tip #3: We have also blogged recently about another declaratory judgment case involving Mirowski, which is being heard in the Southern District of Indiana.

Continue reading "Supreme Court Reverses Federal Circuit on Burden of Proof in Patent Infringement Litigation Brought Under the Declaratory Judgment Act" »

March 10, 2014

Southern District of Indiana to Begin Pilot Program

Indianapolis, Indiana - The Southern District of Indiana is beginning a pilot program that will allow active hyperlinks to be included within e-filed and court-issued documents. Hyperlinks picture-insd.pngwill allow immediate access by the reader to the referenced materials, i.e., case management and electronic court filing system ("CM/ECF") filings, case and statute citations, attachments, and exhibits.

During the initial phase of the pilot program, the court will be issuing a limited number of entries and orders containing hyperlinks. The hyperlinks may be page-specific. For instance, an order may contain a hyperlink to a specific page of a specific affidavit, which will be accessible with one click. Access to court-issued documents will continue to be available via the Notice of Electronic Filing ("NEF") email system.

The next, and most important, phase of the pilot program will involve a small group of attorneys e-filing documents with hyperlinks. When utilized by attorneys, hyperlinks in briefs and other court filings will provide quick, easy, and pinpoint access to particular sections of a case, or to specific filings in the court's record, adding another level of persuasion to their writing. Hyperlinking will also be a great benefit to the court, allowing members of the judiciary and their staff to quickly and easily review case-supporting materials.

Once this pilot program has been tested and meets the court's expectations, detailed information will be available for all attorneys to use in future filings.

If you have questions about this process, they may be directed to the court's ECF Administrator, Jordan Davison, at

Practice Tip: Even though attorneys can utilize the one "free look" to the e-filed documents associated with the NEF, accessing other CM/ECF hyperlinked documents contained within the main document will be subject to normal PACER fees, and any hyperlinks to Westlaw or LexisNexis citations will require attorneys to login to those services.

March 7, 2014

Supreme Court Grants Review for Four Intellectual Property Lawsuits

Washington, D.C. - The Supreme Court of the United States agreed to review the judgmentsUSSCPicture.bmp of several Courts of Appeals in four intellectual property disputes. The cases included two patent cases (regarding joint-infringement liability and indefiniteness invalidity), a copyright case (concerning public performances), and a case which may have implications under trademark law (whether a Lanham Act claim is barred by the Food Drug and Cosmetic Act).

Limelight Networks, Inc. v. Akamai Technologies, Inc., Docket No. 12-786, is a patent case involving technology for managing web images and video. Appellate attorneys for Limelight Networks brought the case to the Court after the U.S. Court of Appeals for the Federal Circuit held that, in the case of method patents, multiple parties could be found to jointly infringe on a patent. The Federal Circuit, sitting en banc, held by a 6-5 vote that "all the steps of a claimed method must be performed in order to find induced infringement, but that it is not necessary to prove that all the steps were committed by a single entity."

The question raised for review by the Supreme Court is whether a defendant may be liable for inducing patent infringement under 35 U.S.C. § 271(b) even if none has committed direct infringement under § 271(a). Patent attorneys for technology companies including Google Inc., Cisco Systems, Inc., Oracle Corporation, Red Hat, Inc., and SAP America, Inc. filed a brief in support of Limelight.

Nautilus, Inc. v. Biosig Instruments, Inc., Docket No. 13-369, also involves patent infringement litigation. The patent in dispute relates to heart-rate-monitor technology. At issue is the acceptance of ambiguity within patent claims. The Federal Circuit held that the its use of the claim term "spaced relationship" in describing the positioning of two electrodes with respect to each other was not "insolubly ambiguous" when the intrinsic evidence is considered from the perspective of a person skilled in the art.

The question raised for review is whether the Federal Circuit's acceptance of ambiguous patent claims with multiple reasonable interpretations - so long as the ambiguity is not "insoluble" by a court - defeats the statutory requirement of particular and distinct patent claiming. Amicus briefs have been filed by patent lawyers for multiple organizations, including AARP,, Inc.,  Cisco Systems, Inc., Dell Inc.ESRI, Garmin International, Inc.,  Google Inc., J.C. Penney Corporation, Inc., Limelight Networks, Inc., Netflix, Inc., Newegg Inc.,  Red Hat, Inc., SAP America, Inc., SAS Institute Inc., Verizon Communications Inc., the American Bar Association, the Intellectual Property Law Association of Chicago, Sigram Schindler Beteiligungsgesellschaft mbh, and Yahoo! Inc.

American Broadcasting Companies, Inc. v. Aereo, Inc., Docket No. 13-461, involves copyright litigation over the online streaming of television programs. The Second Circuit affirmed a district court's holding that Aereo's transmission of broadcast TV via the Internet did not constitute a "public performance" and thus did not infringe the right of public performance under copyright law. Aereo contends that, because its mini-antennas are individually leased by the subscribers, all streamed content should be considered a "private performance." American Broadcasting Companies, Inc. ("ABC") contends that the transmission of broadcast programming to the public should be considered to be "public performance" under copyright law.

The question raised for review by the Supreme Court is whether a company "publicly performs" a copyrighted television program when it retransmits a broadcast of that program to thousands of paid subscribers over the Internet. Eight amicus briefs were filed in support of ABC by various media-affiliated entities.

The final intellectual property litigation to recently granted certiorari by the Court is POM Wonderful LLC v. The Coca-Cola Company, Docket No. 12-761. This case was brought by POM Wonderful under the Lanham Act to challenge Coca-Cola's use of the name "Pomegranate Blueberry" for a beverage. POM Wonderful asserted that under the Lanham Act, 15 U.S.C. 1125(a), an action could be brought against Coca-Cola for use of a false or misleading description or representation "in connection with any goods." However, the Ninth Circuit affirmed summary judgment for Coca-Cola on the grounds that the Food Drug and Cosmetic Act comprehensively regulates food and beverage labeling and that, as a result, the Lanham Act claim could not proceed.

The question raised for review is whether a private party may bring a Lanham Act claim challenging a product label regulated under the Food, Drug, and Cosmetic Act.

Practice Tip: The Supreme Court has ultimate, and largely discretionary, appellate jurisdiction. The Court exercises that appellate jurisdiction only for "compelling reasons," such as: resolving a split among the federal circuit courts on an important federal matter; addressing conflicting holdings regarding important federal questions between a federal appellate court and a state's court of law resort or between two state courts of law resort; and where a state court or a federal court of appeals has decided an important question of federal law that has not been, but should be, settled by the Supreme Court, or has decided an important federal question in a way that conflicts with relevant decisions of the Court.

March 6, 2014

Patent Office Issues 127 Patents To Indiana Citizens in February 2014

The U.S. Patent Office issued the following 127 patent registrations to persons and businesses in Indiana in February 2014, based on applications filed by Indiana patent attorneys:

PAT. NO. Title
D700,366 Wall panel
D700,365 Wall panel
D700,364 Wall panel
D700,333 Intraspinous process spacer implant
8,659,374 Solenoid coil with reverse turn


Continue reading "Patent Office Issues 127 Patents To Indiana Citizens in February 2014" »

February 28, 2014

PC Ruehl Engineering Sues AM General for Patent Infringement of Humvee Frame Rail Assembly

South Bend, Indiana - Indiana and Wisconsin patent attorneys for Phillip C. Ruehl of viewer.pngWauwatosa, Wisconsin ("Ruehl") and PC Ruehl Engineering, Inc. of Wisconsin ("PC Ruehl") filed patent infringement litigation in the Northern District of Indiana alleging that AM General LLC of South Bend, Indiana infringed Boxed Frame Member and Method for Manufacture, Patent No. 8,484,930 B2 (the "'930 Patent"), which has been issued by the U.S. Patent Office.

From 1969 to 2001, Ruehl was employed as an automotive frame chassis engineer. In his various positions, including as a manager of product design, Ruehl's responsibilities included contributing to the designs of many light truck and sport utility vehicle frames.

Since the early 1980s, AM General has manufactured for the United States military, and eventually for the militaries of many other countries around the world, a High Mobility Multi-Purpose Wheeled Vehicle (or HMMWV, also known as the Humvee).

In November 2004, an employee of AM General allegedly contacted Ruehl to inquire if Ruehl was interested in consulting on a project to upgrade the frame rails for AM General's Humvee line of trucks. The employee described the frame rail project objectives to Ruehl and sent drawings to Ruehl showing the current side rail design.

From December 2004 through February 2005, Ruehl indicates that he studied the drawings and began to consider ways to meet AM General's objectives so that he could add value if and when AM General decided it wanted to retain him as a consultant. He contends that he was neither under contract with AM General nor was he being paid or otherwise compensated by AM General during this time.

Ruehl states in his complaint that he began to consider several potential solutions which he believed to be the most efficient means of solving the stated challenges. He sketched up many of these potential solutions so that he would remember each and be able to explain how he would proceed with each idea if he were asked. One of the new solutions Ruehl conceived of and sketched was a design that solved many of the unique dimensional and quality problems that AM General was experiencing with its current frame rail design (the "Invention").

AM General allegedly was never invoiced and never paid Ruehl for the work he did during this preparation period. Instead, Ruehl states that AM General specifically told him that the rail design program itself was tentative, and that if it did go forward, he would not be "on board" and under contract until he had met with representatives of AM General and signed additional documents at AM General's Michigan facility.

In February 2005, having allegedly already conceived of the Invention, PC Ruehl received from AM General a purchase order dated February 24, 2005 for "engineering support for HMMWV frame rail feasibility study." Under this purchase order, AM General asked Ruehl to provide engineering support for a feasibility study and stated that PC Ruehl would be paid $150 per hour for Ruehl's efforts. Ruehl signed the purchase order on behalf of PC Ruehl.

In March 2005, Ruehl drew a more detailed, presentable, and buildable sketch illustrating the Invention in its preferred embodiment, and had the owner of a Milwaukee-area prototype shop confirm its manufacturability, witness it, and agree to build a small "proof-of-concept" sample. Ruehl states that he did not bill, and was not paid by, AM General for this work.

Ruehl then brought the Invention to a meeting with AM General. Before beginning the substance of the meeting, Ruehl states that he (on behalf of PC Ruehl) and AM General signed a Mutual Confidentiality Agreement. This agreement provided that all confidential information disclosed by Ruehl to AM General and by AM General to Ruehl would "remain the property of [the] Disclosing Party[.]" "Confidential Information" was defined in the agreement as "[a]ny information that has value to the Disclosing Party and is not generally known to its competitors," and specifically included "ideas, concepts, plans,...drawings,...products, processes[.]" Moreover, the agreement stated, "Nothing contained in this Agreement shall be construed as granting or conferring to Receiving Party any patent rights or licenses from Disclosing Party either expressly or by implication[.]"

Following this agreement, Ruehl worked with AM General to provide engineering support services for the frame rail feasibility study. Ruehl was paid for this work pursuant to the February 2005 purchase order. Ruehl also provided additional engineering support services to AM General under an April 2005 purchase order. Ruehl contends that AM General never paid him or PC Ruehl for the transfer of ownership of Ruehl's Invention.

On November 1, 2005, Ruehl filed a patent application on the Invention, Provisional Patent Application No. 60/732,451. Ruehl followed that application with a non-provisional patent application, Patent Application Serial No. 11/279,321, on April 11, 2006.

AM General filed its own patent application on Ruehl's Invention, filing Provisional Patent Application Serial No. 60/764,045 on February 1, 2006, and non-provisional patent application Serial No. 11/670,217, on February 1, 2007.

On November 1, 2005, the day that Ruehl filed the provisional patent application, he informed AM General of the filing and of his expectation of receiving royalties for the use of his Invention. Conversely, AM General has purportedly advised Ruehl that it is AM General's position that Ruehl had an obligation to assign his rights in the Invention to AM General.

On July 16, 2013, the United States Patent and Trademark Office issued the '930 Patent to Ruehl. Ruehl now contends that AM General has incorporated Ruehl's Invention into the frame rail assembly it is now using for its Humvee which it is manufacturing and selling to the United States Military and to others.

At issue in this Indiana patent litigation are the following:

• Count I: Infringement of the '930 Patent, and
• Count II: Breach of Contract.

Ruehl and PC Ruehl, via patent counsel, ask the court for a judgment that AM General has directly infringed and continues to infringe the '903 Patent; damages, including treble damages; a judgment that AM General's infringement has been willful; an injunction enjoining AM General from infringing the '930 Patent; a declaration that this case is exceptional; costs and fees.

Practice Tip: The U.S. Patent and Trademark Office provides for the recordation of assignments of applications, patents, and registrations. The patent assignment abstract of title shows that an interest in this patent was assigned from Ruehl to AM General in 2008. In 2010, another assignment of this patent was executed from AM General to Ruehl. In 2011, an assignment from AM General to itself was filed to correct error. Finally, in 2013, a second assignment to correct error, this time to and from Ruehl, was executed.

Continue reading "PC Ruehl Engineering Sues AM General for Patent Infringement of Humvee Frame Rail Assembly" »

February 27, 2014

James Dean, Inc.'s Indiana Trademark Infringement Litigation Against Twitter Removed to Federal Court

Indianapolis, Indiana - Illinois and Missouri trademark attorneys for James Dean, Inc. of James_Dean_in_Rebel_Without_a_Cause.jpgIndiana sued in Indiana state court alleging that Twitter, Inc. of California infringed the trademark James Dean, which has been issued by the U.S. Trademark Office by allowing the registration of the Twitter handle @JamesDean. The case was removed from the Superior Court of the County of Hamilton, Indiana to the Southern District of Indiana.

Plaintiff James Dean, Inc. filed a trademark complaint against Twitter, as well as the fictitious persons, John Doe Defendants 1-5 Company, in an Indiana state court. In the complaint, Plaintiff alleged that it is the exclusive owner of the name, likeness, voice, right of publicity and endorsement, worldwide trademarks, copyrights, and other intellectual property including but not limited to visual and aural depictions, artifacts, memorabilia, and life-story rights, and/or trade dress of the late movie star James Dean.

James Dean, Inc. further alleges that Twitter has allowed the registration and operation of a Twitter account, using the handle @JamesDean, located at, which is purportedly in violation of Plaintiff's rights.

In the complaint, filed by an Indiana trademark lawyer, James Dean, Inc. asserted nine causes of action against Twitter:

• Count I - Trademark Infringement Under Section 32(1) or 3(A) of the Lanham Act;
• Count II - False Endorsement Under Lanham Act § 43(A);
• Count III - Indiana State Statutory Right of Publicity;
• Count IV - Common Law Right of Publicity;
• Count V - Common Law Unfair Competition;
• Count VI - Unjust Enrichment;
• Count VII - Conversion;
• Count VIII - Deception; and
• Count IX - Indiana Crime Victims' Act.

For relief, James Dean, Inc. sought damages, including treble damages, costs, and attorney's fees as set out in the Indiana Right of Publicity Statute, Lanham Act and other statutes. In addition, Plaintiff seeks injunctive relief.

Twitter removed the action pursuant to 28 U.S.C. § 1331 (federal-question jurisdiction) and 28 U.S.C. § 1332 (diversity-of-citizenship jurisdiction). To support the former basis for federal jurisdiction, Twitter noted federal questions inherent in the filing of a claim under the Lanham Act. Twitter also claimed supplemental jurisdiction for the remaining claims under Indiana law.

To support the latter basis for jurisdiction in an Indiana federal court, Twitter asserted that the two prongs for diversity-of-citizenship jurisdiction were met. First, James Dean, Inc. is a citizen of Indiana, as it has alleged that it is incorporated under the laws of the State of Indiana with its principal place of business in Indiana, while Twitter claims to be a citizen of two states: Delaware and California. Second, while Twitter "strongly contests liability and does not believe Plaintiff is entitled to any relief whatsoever," it indicated that, were liability to be found, the amount in controversy could exceed $75,000, given that James Dean, Inc. is suing for "all damages" allowed by the applicable statutes, which can include actual damages, treble damages, punitive damages, statutory damages and attorneys' fees.

Practice Tip:

James Dean was born on February 8, 1931, in Marion, Indiana. He grew up in Fairmount, Indiana, about 60 miles northeast of Indianapolis. Dean starred in East of Eden, Rebel Without a Cause and Giant, receiving two Academy Award nominations for Best Actor.

In 1955, Dean died in an automobile accident. As a result of the nearly 60 years that have passed since his death, it is unlikely that those who follow @JamesDean believe that the tweets have been written by James Dean himself. Nonetheless, celebrity licensing agency CMG Worldwide, based out of Carmel, Indiana, is attempting to recover the James Dean Twitter account.

CMG, which also represents such celebrity images as Marilyn Monroe, Jackie Robinson and Babe Ruth, has attempted "on numerous occasions" to make Twitter take action to block and identify owners of various unauthorized accounts. Those accounts could give the impression, it says, that the users have permission from the estates of the celebrities or CMG and "result in immeasurable and irreparable damage."

Finally, most of the James Dean trademarks that were registered by the U.S. Trademark Office have been either abandoned or cancelled. It will be interesting to see to what degree this fact influences the court, should liability be established and a calculation of damages be appropriate.

Continue reading "James Dean, Inc.'s Indiana Trademark Infringement Litigation Against Twitter Removed to Federal Court" »

February 26, 2014

One Number Sues Google in Indiana for Patent Infringement

Indianapolis, Indiana - Indiana patent infringement litigation was commenced by a patent attorney for One Number Corporation of Anderson, Indiana. The lawsuit, filed in the Southern District of Indiana, alleges that Google, Inc., of Mountain View, California, infringed One Number's Contact Number Encapsulation System, Patent No. 8,611,511 (the "'511 patent"), which has been issued by the U.S. Patent Office.

20140226PatentPicture.bmpAt issue in this patent litigation are the respective intellectual property rights of One Number and Google in single-phone-number telephone services. Such services allow a phone call made to one number to be transferred to multiple other phone numbers.

One Number asserts that Google has infringed and is still willfully infringing the '511 patent by making, selling and using a system that embodies One Number's patented invention. The service claimed to infringe upon the '511 patent is Defendant's Google Voice technology. The patent-in-suit was issued on December 17, 2013 and has been assigned to One Number.

One Number asks for judgment in its favor against Google, a final injunction against the continuing infringement, an accounting for damages, interest, costs and attorneys' fees.

Practice Tip: This is not the first Indiana patent litigation that One Number has instituted against Google relating to the Google Voice application. At least one similar complaint was filed in March 2010, although that complaint pertained to U.S. Patent Nos. 7,680,256 and 7,440,565. Google responded, among other ways, by seeking reexamination of One Number's patents. This approach met with some success but was apparently insufficient to dissuade One Number from pursuing further patent litigation.

Continue reading "One Number Sues Google in Indiana for Patent Infringement" »

February 24, 2014

Union Hospital Sues Attachmate Seeking a Declaration of Non-Infringement

Terre Haute, Indiana - Copyright attorneys for Union Hospital, Inc. of Terre Haute, Indiana filed an Indiana copyright lawsuit against Attachmate Corporation of Seattle, Washington in the Southern District of Indiana asking the court to declare that Union Hospital had not unionhospitalpicture.jpginfringed either of two Attachmate software works titled "EXTRA!" and "Reflection", Copyright Registration Nos. TX0005717997 and TX0007351951, which were issued by the U.S. Copyright Office.

Union Hospital, a not-for-profit regional hospital, provides healthcare to residents of the Wabash Valley community, regardless of their ability to pay. Attachmate is one of the largest software companies in the world, with 40 offices doing business in 145 countries.

Union Hospital states that, since at least 1997, it has been licensed to use Attachmate software for which it paid tens of thousands of dollars. In 2013, Attachmate conducted an audit of Union Hospital's use of Attachmate software products. According to the complaint, as a result of this audit, Attachmate determined that Union Hospital had used the software beyond the terms of the licenses and demanded that Union Hospital pay Attachmate over $2,000,000 in license fees, interest and other charges. Union Hospital indicates Attachmate subsequently threatened to initiate copyright infringement litigation against Union Hospital.

The claims of liability which Attachmate apparently made have been attacked by Union Hospital on several grounds. Union Hospital states that the claim of over-deployment of certain software was based not upon the actual usage of Attachmate's product, but upon the potential total number of users who could have used Attachmate software on Union Hospital's server regardless of whether the user ever accessed or used the product. Union Hospital further asserts "estoppel, waiver, laches, and/or acquiescence" in its defense.

This Indiana litigation, filed under the Declaratory Judgment Act, was filed by Indiana copyright lawyers for Union Hospital. The complaint lists three causes of action:

1. Declaratory Judgment on Copyright Infringement Claims
2. Declaratory Judgment on Copyright Infringement Claims for Unregistered Copyrights
3. Declaratory Judgment on Breach of Contract Claims

Union Hospital asks the court to:
a. Declare that one or more of Attachmate's breach of contract claims are preempted by the Copyright Act;
b. Declare that Attachmate's asserted license agreements are invalid and unenforceable;
c. Declare that Union Hospital is not liable to Attachmate for copyright infringement, as Union Hospital's use of Attachmate's software was licensed;
d. Declare that Attachmate's copyright infringement and/or breach of contract claims are barred by estoppel, waiver, laches, and/or acquiescence;
e. Declare that Attachmate's copyright infringement and/or breach of contract claims are barred by the applicable statute(s) of limitations;
f. Declare that, if Attachmate's claims are allowed to proceed, any damages for Attachmate's copyright and/or breach of contract claims be substantially reduced due to Attachmate's failure to mitigate its damages;
g. Declare that Attachmate's alleged copyrights were not timely registered and therefore Attachmate is barred from seeking statutory damages and attorneys' fees for its copyright infringement claims;
h. Declare that Attachmate's copyright infringement claims based on unregistered copyrights are barred; and
i. Alternatively, declare that Attachmate's is only entitled to de minimis damages because Union Hospital's uses did not exceed the total number of uses that it contracted for with Attachmate.

Practice Tip:

The use of the compound conjunction "and/or" in this complaint raises some interesting possibilities. As one basis for federal jurisdiction, Plaintiff alleges that "Attachmate's representatives have expressly or impliedly threatened litigation for breach of contract and/or copyright infringement...." Such an assertion may not be sufficient to invoke federal-question jurisdiction, as it claims that the threat of litigation exists for one of three possible circumstances: breach of contract only, copyright infringement only, or both breach of contract and copyright infringement. Under the first scenario - breach of contract only - no federal jurisdiction would lie. This potential problem may be remedied by other allegations in the complaint, including a separate assertion of diversity jurisdiction.

The use of "and/or" is also found in the prayer for relief. There, Plaintiff asks for, inter alia, declarations "that Attachmate's copyright infringement and/or breach of contract claims are barred by estoppel, waiver, laches, and/or acquiescence" and "that Attachmate's copyright infringement and/or breach of contract claims are barred by the applicable statute(s) of limitations." Again, this use of the compound conjunction leaves open the possibility that the court might interpret the prayer for relief as a request to bar the claims of breach of contract or copyright infringement, but not both.

Continue reading "Union Hospital Sues Attachmate Seeking a Declaration of Non-Infringement " »

February 21, 2014

Rieth-Riley Sues Superior Asphalt for Cybersquatting

South Bend, Indiana - An Indiana trademark attorney for Rieth-Riley Construction Co., Inc. of Goshen, Indiana ("Rieth-Riley") sued in the Northern District of Indiana alleging that Jeffrey RiethPicture.pngKresnak and Superior Asphalt, Inc. ("Superior"), both of Michigan, infringed the RIETH-RILEY trademark, Trademark Registration No. 1,659,123, which has been issued by the U.S. Trademark Office.

Rieth-Riley, founded in 1916, provides many services under the Rieth-Riley brand, including highway construction, asphalt and concrete paving, site preparation and excavation, bridge construction, underground utilities and drainage construction, asphalt and concrete recycling, curb and sidewalk construction, mining and aggregate processing, and providing sand, gravel and other aggregates for construction projects.

Superior, in business for over 30 years, is in the asphalt manufacturing, supplying, paving and maintenance business. It provides its services to residential, commercial, manufacturing and municipal customers. Defendant Kresnak owns Superior. Rieth-Riley indicates that it considers Superior to be a competitor.

Both companies maintain websites to promote their companies. Rieth-Riley operates its website at Superior operates its site at Rieth-Riley contends that Superior also purchased and began operating "" in violation of Rieth-Riley's intellectual property rights in the trademarked name; it further indicates that this accused domain name resolves to Superior's website. Rieth-Riley states that it attempted to reach an agreement with Defendants to cease using the accused website but that, in response, Defendants indicated that they would do so for $10,000.

Rieth-Riley contends that Defendants are unlawfully profiting through their use of the Rieth-Riley trademark. Specifically, Superior is accused of using the domain name with a bad-faith intent to profit by redirecting Internet traffic intended for the Rieth-Riley website to Superior's website.

Rieth-Riley also states that Defendants' unauthorized use of the Domain Name is likely to cause confusion or mistake or to deceive the consuming public as to the affiliation, connection, association or sponsorship of Superior with Rieth-Riley or the Rieth-Riley Mark, or as to the origin, sponsorship, or approval of Superior's goods, services or activities by Rieth-Riley or the Rieth-Riley brand.

Finally, Rieth-Riley asserts that this use was with notice and actual knowledge of Rieth-Riley's prior rights and, as a result, Superior's acts constitute knowing and willful violations of the Lanham Act.

In this Indiana trademark litigation, the following counts are asserted:

• Count I: Federal Trademark Infringement
• Count II: Unfair Competition
• Count III: Cyberpiracy

Rieth-Riley asks the court for:

• preliminary and permanent injunctions enjoining the infringement of the Rieth-Riley trademark;
• preliminary and permanent injunctions enjoining Defendants from engaging in acts of false designation of origin and false description, pursuant to 15 U.S.C. §1125;
• preliminary and permanent injunctions enjoining conduct which causes, or is likely to cause, confusion, mistake, deception, or misunderstanding as to the source, affiliation, connection or association of Defendants' products or services;
• preliminary and permanent injunctions enjoining the operation of any web site utilizing the accused domain name or the Rieth-Riley trademark;
• a judgment against Defendants for statutory damages;
• a judgment against Defendants for (1) all profits attributable to Defendants' unauthorized use of the accused domain name, (2) damages sustained by Rieth-Riley on account of Defendants' unlawful activities, and (3) treble damages;
• an order transferring the accused domain name to Plaintiff;
• an order for the destruction of any infringing items bearing the Rieth-Riley trademark; and
• costs and attorneys' fees.

Practice Tip:

Plaintiff indicates that it attempted to obtain an agreement from Defendants to cease using the accused domain name. Despite this effort, Plaintiff contends that Defendants continued to use the allegedly infringing website name. This lawsuit for trademark infringement, unfair competition and cyberpiracy followed.

Another approach available to a plaintiff in such a situation is to seek a transfer the domain name under the Uniform Domain-Name Dispute-Resolution Policy ("UDRP"). This policy was established to resolve "The Trademark Dilemma" inherent in the largely unpoliced sales of domain names -- the registration of a trademark without the consent of the trademark owner.

As part of the process of registering a domain name, registrants must, among other things, 1) "represent and warrant" that registering the name "will not infringe upon or otherwise violate the rights of any third party" and 2) agree to have the matter heard as an UDRP proceeding if any third party asserts that the domain name violates its trademark rights.

The UDRP is an administrative procedure. A UDRP limits itself to matters concerning abusive registrations and will not intervene in genuine disputes over trademark rights. To prevail in a UDRP proceeding, the complainant must establish three elements:

1) The domain name is identical or confusingly similar to a trademark or service mark in which the complainant has rights;
2) The registrant does not have any rights or legitimate interests in the domain name; and
3) The registrant registered the domain name and is using it in "bad faith."

Continue reading "Rieth-Riley Sues Superior Asphalt for Cybersquatting" »

February 20, 2014

Noble Roman's Sues Another Indiana Franchisee Alleging Trademark Infringement

Indianapolis, Indiana - An Indiana trademark attorney for Noble Roman's, Inc. of Indianapolis, Indiana sued in the Southern District of Indiana alleging that B & MP, LLC (which was dissolved in 2011) and Leslie Perdriau of Apple River, Illinois (collectively, "B & MP")picture2Nobleromans.bmp infringed the trademark Noble Roman's, Registration No. 987,069, as well as the trademark, The Better Pizza People, Registration No. 1,920,428. Noble Roman's also lists a design mark, Registration No. 1,682,308 in its complaint. All of the marks have been registered by the U.S. Trademark Office.

Noble Roman's is in the business of franchising the operation of Noble Roman's pizza franchises that feature pizza, breadsticks, and other related food items to various franchisees throughout the world. Noble Roman's has used its trademarks, among them "Noble Roman's" and "The Better Pizza People," registered in 1974 and 1995, respectively, in commerce in connection with marketing, identifying, and promoting its pizza franchises.

On or about March 16, 2010, Noble Roman's and B & MP entered into two franchise agreements. Under the terms of the agreements, B & MP became a franchisee of Noble Roman's licensed and authorized to sell "Noble Roman's" and "Tuscano's" branded food products using Noble Roman's intellectual property assets. These agreements included terms relating to the accurate reporting of sales and timely payment of franchise and other fees.

B & MP is accused of failing to pay royalties as required under the agreement and of misreporting sales, among other things. Noble Roman's contends that B & MP purposely, intentionally and knowingly misreported its sales to Noble Roman's for the purpose of avoiding payment of franchise fees and/or royalties which were due.

Noble Roman's also states that B & MP used the Noble Roman's trademarks in connection with the sale of non-Noble Roman's pizza and other menu items and that such use of the trademarks was without the authorization or consent of Noble Roman's. Those acts were asserted to constitute trademark infringement, in violation of 15 U.S.C. § 1114(1), as well as a false designation of origin in violation of 15 U.S.C. § 1125.

Although the complaint lists two Defendants, Noble Roman's states that Defendant B & MP was involuntarily dissolved in 2011 and that Defendant Leslie Perdriau succeeded to its obligations.

The complaint, filed by an Indiana trademark lawyer, lists the following:

• Count One (Trademark Infringement)
• Count One [sic] (Breach of Contract)
• Count Two (Fraud)

Noble Roman's asks for judgment in its favor in amount to be proven at trial, together with interest, punitive damages, costs of collection and reasonable attorneys' fees.

Practice Tip: Noble Roman's has been particularly aggressive in enforcing franchise agreements. Since 2007, it has also filed the following suits in the Southern District of Indiana:

September 5, 2012 - NOBLE ROMAN'S, INC. v. VILLAGE PANTRY





July 17, 2009 - NOBLE ROMAN'S, INC. v. MARDAN, INC.




February 17, 2009 - NOBLE ROMAN'S, INC. v. EXPRESS LANE, INC.

February 10, 2009 - NOBLE ROMAN'S, INC. v. JJP&L, LLC



October 6, 2008 - NOBLE ROMAN'S INC. v. JAY'S GAS LLC




September 17, 2007 - NOBLE ROMAN'S, INC. v. THE FRENCH BAGUETTE, LLC et al.

July 26, 2007 - NOBLE ROMAN'S, INC. v. MR. RON'S, L.C.

July 19, 2007 - NOBLE ROMAN'S INC. v. BAUER BUILT, INC. et al.

Continue reading "Noble Roman's Sues Another Indiana Franchisee Alleging Trademark Infringement" »

February 19, 2014

Maker of SNOWTIME anytime! Indoor Snowballs Sues for Trade Dress Infringement

Indianapolis, Indiana - An Indiana trademark attorney for KM Innovations, LLC of New snowball-picture.bmpCastle, Indiana ("KM") filed a lawsuit in the Southern District of Indiana alleging that Opportunities, Inc. of Colo, Iowa competed unfairly and infringed the trade dress of KM's "SNOWTIME anytime!" indoor snowballs.

The SNOWTIME anytime! concept was conceived in December 2012. At a party, several parents realized that a market might exist for "indoor snowballs," which would enable children to have a "snowball fight" but without the usual requirements of snow or being outside. KM later introduced a product based on this idea. KM also indicates that it is pursuing a patent on its indoor snowballs.

In this lawsuit for trade dress infringement, which also includes allegations of unfair competition, KM asserts that Opportunities imports, sells and/or is offering to sell polyester-based indoor snowballs and that Opportunities' indoor snowballs are low-quality knockoffs of KM's famous product. KM also contends that Opportunities has deliberately copied the distinctive features of KM's trade dress in an attempt to trade upon the goodwill associated with that trade dress.

To support its contentions of trade dress infringement, KM states that, inter alia, its SNOWTIME anytime! snowballs come in a clear package that includes a label on the front that depicts a mountainous background set in a blue and white theme. At the top of the package, the term "SNOWTIME" appears in a blue that is darker than the lighter blues used elsewhere in the label. The upper part of the lettering is covered with "snow," giving the commercial impression of fresh snow. Also shown are a blue and white snowball with wording inside and people in snowsuits having fun playing with KM's indoor-snowball product outdoors.

KM lists several similarities that it contends support a finding of trade dress infringement. It indicates that Opportunities' packaging includes, among other features: a partially clear exterior that depicts a mountainous background set in a blue and white theme; an illustration of fresh snow covering the words "Snowball Fun" with letters that are a darker blue than the other blues on the package; a generally blue and white snowball with wording inside; and a depiction of people dressed in snowsuits playing outside with the product.

In the complaint, filed by an Indiana trademark lawyer, one count, "Trade Dress Infringement and Unfair Competition" is alleged. KM asks the court for:

• a judgment that Opportunities' accused packaging infringes KM's trade dress rights;
• a judgment that Opportunities committed unfair competition by offering its product in the accused packaging;
• damages, including treble damages for willful and deliberate infringement of KM's trade dress rights and acts of unfair competition;
• a permanent injunction; and
• an award to KM of its attorneys' fees, costs and expenses.

Practice Tip:

The United States Supreme Court addressed the elements required for trade dress to be protected in Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763 (1992). In Two Pesos, the Court held that, to establish a cause of action for trade dress infringement, a plaintiff must establish that (a) the design is non-functional; (b) the design is inherently distinctive or distinctive by virtue of having acquired secondary meaning; and (c) there is a likelihood of confusion.

This product was conceived barely a year ago. While SNOWTIME anytime! may have won first place at the Christmas Gift and Hobby Show in Indianapolis, that victory clearly did not take place in November 2012, as was stated in the complaint, as the product did not yet exist.

As a result of the product's short time in the marketplace, one of the primary hurdles for Plaintiff may be timing. Specifically, if Plaintiff fails to prove that the trade dress in question is inherently distinctive, it could be difficult to prove that secondary meaning has been established in the minds of the consuming public in the time that the product has been available for purchase.

Continue reading "Maker of SNOWTIME anytime! Indoor Snowballs Sues for Trade Dress Infringement" »

February 14, 2014

Chartreuse Sues Chartreuse Fragrances Seeking Declaratory Judgment of Non-Infringement

Indianapolis, Indiana - An Indiana trademark attorney for Chartreuse LLC of Indianapolis, candle-picture.bmpIndiana ("Chartreuse") filed a lawsuit in the Southern District of Indiana seeking a declaration that the trademark Chartreuse, Trademark Registration No. 2,997,572, would not be infringed when used in association with handmade soy candles. The trademark, which has been issued by the U.S. Patent and Trademark Office, belongs to Chartreuse Fragrances LLC of Fort Lee, New Jersey ("Chartreuse Fragrances").

Chartreuse states that it has been selling handmade soy candles bearing a "Chartreuse" trademark since January of 2013. Chartreuse Fragrances indicates, via its trademark application, that it has used the "Chartreuse" trademark in commerce since 2002. The trademark is registered to Chartreuse Fragrances for use on candles.

Chartreuse states in its complaint that, on January 7, 2014, Chartreuse Fragrances asserted that Chartreuse's use of the "Chartreuse" mark constituted trademark infringement and demanded that Chartreuse cease and desist all use of the trademark. Plaintiff Chartreuse also states that Chartreuse Fragrances contended that Chartreuse's use of the trademark in connection with the candles was likely to cause consumer confusion.

In this complaint, Chartreuse requests a declaration that its use of "Chartreuse" in connection with handmade soy candles has not infringed the intellectual property rights of Chartreuse Fragrances in the "Chartreuse" trademark. Chartreuse also seeks a declaration that any trademark rights asserted by Chartreuse Fragrances are invalid and unenforceable. Chartreuse supports this assertion in part by contending that Chartreuse Fragrances' trademark is descriptive of Defendant's candles and therefore not entitled to registration, as the term Chartreuse is descriptive of a greenish-yellow color.

Chartreuse makes several additional claims in its complaint: that Chartreuse Fragrances misstated the first-use-in-commerce date that it provided to the U.S. Patent and Trademark Office ("USPTO"); that Chartreuse Fragrances asserted falsely to the USPTO that it was using the trademark at the time it applied for a federal registration with the USPTO; that Chartreuse Fragrances is not currently using the trademark in interstate commerce in connection with the candles; and that any use by Chartreuse Fragrances of the trademark on or in connection with candles has been discontinued for at least three consecutive years and, thus, the trademark has been abandoned pursuant to § 1127 of the Lanham Act.

Chartreuse's complaint, filed by an Indiana trademark lawyer, makes two claims for relief: 1) Unenforceability and Invalidity of Defendant's Mark and 2) Non-Infringement of Trademark. It asks that Chartreuse Fragrances' trademark be declared to be not entitled to registration; that the trademark be canceled; for a declaration that Chartreuse is not infringing, has not infringed, and is not liable for infringing the trademark; and for attorneys' fees, costs, and expenses.

Practice Tip:

At first glance, this complaint has a number of potential areas of weakness. While this is a suit for declaratory judgment, it seems as if it may not be yet justiciable for lack of ripeness. In MedImmune v. Genentech, 549 U.S. 118 (2007), the U.S. Supreme Court revised the Federal Circuit's test for ripeness under the Declaratory Judgment Act, which had required a reasonable apprehension of a lawsuit in order to establish jurisdiction. The Court broadened the scope of declaratory judgment jurisdiction, holding that the totality of the circumstances should be evaluated in determining the existence of "a substantial controversy, between parties having adverse legal interests, of sufficient immediacy and reality to warrant relief."

In this case, where the only allegation of controversy is that a single assertion of infringement was purportedly made, it is unclear whether the complaint adequately alleges, under the totality of the circumstances, a controversy of sufficient immediacy to warrant jurisdiction under the Declaratory Judgment Act.

Additionally, Plaintiff asserted that "Defendant's Mark is descriptive of the Covered Goods and therefore not entitled to registration, as the term CHARTREUSE is descriptive of a greenish-yellow color." However, it was not alleged in the complaint that Chartreuse Fragrances' product was, in fact, greenish-yellow in color.

Thus, it appears somewhat more likely, without additional facts, that this trademark might properly be placed into the "arbitrary" category. A trademark is deemed to be "arbitrary" when the word used as a trademark does not suggest or describe a significant ingredient, quality, or characteristic of the goods or services but instead is used in an unexpected or uncommon way (e.g., using "Apple" for computers). Under trademark law, trademarks falling into the arbitrary category are accorded the highest level of protection, as they are deemed to be inherently distinctive.

Continue reading "Chartreuse Sues Chartreuse Fragrances Seeking Declaratory Judgment of Non-Infringement" »

February 13, 2014

Alcon Sues Cipla for Patent Infringement of Pataday™

Indianapolis, Indiana - Indiana patent lawyers for Alcon Research, LTD of Fort Worth,pataday.jpg Texas and Alcon Pharmaceuticals Ltd of Fribourg, Switzerland (collectively, "Alcon") sued in the Southern District of Indiana alleging that Cipla Limited of Mumbai Central, Mumbai and Cipla USA Inc. of Miami, Florida (collectively, "Cipla") infringed Olopatadine Formulations for Topical Administration, Patent Nos. 6,995,186 (the "'186 patent") and 7,402,609 (the "'609 patent"), which have been issued by the U.S. Patent Office.

According to the complaint, the Cipla entities are engaged in the generic-pharmaceutical business. Alcon asserts that one or more of the entities develops, manufactures, imports, markets, offers to sell and/or sells generic drugs throughout the United States.

Cipla filed an Abbreviated New Drug Application ("ANDA") with the U.S. Food and Drug Administration ("FDA") seeking approval to manufacture and sell a generic version of Pataday™ ophthalmic solution, a drug product containing olopatadine hydrochloride. The two patents-in-suit, which Alcon claims to own, are asserted to cover Pataday™. Alcon contends that Cipla's submission of this ANDA to obtain approval to engage in the commercial manufacture, use, offer for sale, sale and/or importation of Cipla's ANDA product before the expiration of the patents-in-suit is an act of infringement under 35 U.S.C. § 271(e)(2)(A).

Alcon states that it believes that the Cipla entities are part of a vertically integrated and unified organization and that they will act in concert to introduce the generic version of Pataday™ to the United States market prior to the expiration of Alcon's patents.

In the complaint, intellectual property attorneys for Alcon list the following claims:

• Count I: Infringement of the '186 Patent
• Count II: Infringement of the '609 Patent
• Count III: Declaratory Judgment of Infringement of the '186 Patent
• Count IV: Declaratory Judgment of Infringement of the '609 Patent

Alcon asks for a judgment that the '186 and '609 patents are valid and enforceable and have been infringed; a judgment providing that the effective date of any FDA approval of commercial manufacture, use or sale of Cipla's ANDA product be not earlier than the latest of the expiration date of the patents-in-suit, inclusive of any extension(s) and additional periods of exclusivity; preliminary and permanent injunctions protecting products covered by the '186 patent prior to its expiration; preliminary and permanent injunctions protecting products covered by the '609 patent prior to its expiration; a judgment declaring that the commercial manufacture, use, sale, offer for sale or importation of Cipla's ANDA product, or any other drug product covered by the '186 patent, will infringe, induce the infringement of, and contribute to the infringement by others of, that patent; a judgment declaring that the commercial manufacture, use, sale, offer for sale or importation of Cipla's ANDA product, or any other drug product covered by the '609 patent, will infringe, induce the infringement of, and contribute to the infringement by others of, that patent; a declaration that this is an exceptional case and an award of attorneys' fees; and costs and expenses.

Practice Tip:

India is the world's leading exporter of generic drugs. Some Indian manufacturers are aggressively seeking to have their generic versions approved by the FDA well before a brand-name drug's patent(s) expire. This has led to a substantial amount of patent litigation against Indian companies, as the difference in market price between brand-name drugs and their generic counterparts can be enormous.

In addition to Indian companies being subject to litigation in the United States, Indian courts are also actively engaged in the ongoing dispute over intellectual property rights. Those courts, as well as the Indian government, have in several notable instances found in favor of Indian generic-drug manufacturers and against intellectual property holders in the United States. For example, in 2012, a decision by India's Controller General of Patents, Designs and Trademarks granted a "compulsory license" of the patented cancer drug Nexavar.

According to this decision, Bayer must license Nexavar to Natco Pharma, an Indian company, in exchange for a 6% royalty on Natco's net sales. The generic drug will be sold in India for $176 per month instead of the $5,600 per month that Bayer had been charging in that market.

While a provision exists within the World Trade Organization's Trade-Related Aspects of Intellectual Property Rights ("TRIPS") Agreement that allows for compulsory licensing of pharmaceuticals, it has been used only infrequently, usually for drugs that treat AIDS. This was the first time such compulsory licensing was granted in India. India is only the second country, after Thailand, to grant a compulsory license to a cancer drug.

Continue reading "Alcon Sues Cipla for Patent Infringement of Pataday™" »