June 12, 2013

Eli Lilly Sues Perrigo for Patent Infringement of Axiron

Indianapolis, Ind. -- Patent lawyers for Eli Lilly & Co. of Indianapolis, Ind. ("Lilly"), Eli Lilly Lilly2.JPGExport S.A., of Vernier/Geneva, Switzerland (a wholly owned subsidiary of Eli Lilly & Co.) and Acrux DDS Pty Ltd. of West Melbourne, Victoria, Australia ("Acrux") filed a patent infringement suit alleging that Perrigo Company of Allegan, Mich. ("Perrigo Company") and Perrigo Israel Pharmaceuticals Ltd. of Bnei Brak, Israel ("Perrigo Israel," a wholly owned subsidiary of Perrigo Company), infringed Patent Nos. 8,435,944; 8,419,307; and 8,177,449, filed with the U.S. Patent Office.

ACRUX-Logo.JPGLilly is engaged in the business of research, development, manufacture and sale of pharmaceutical products.  Acrux is engaged in the development and commercialization of pharmaceutical products for sale.  Both sell their products worldwide. 

Perrigo Company and Perrigo Israel (collectively, "Perrigo") are pharmaceutical companies that develop, manufacture, market and distribute generic pharmaceutical products for sale throughout the United States.  These products include pharmaceuticals, infant formulas, nutritional products, dietary supplements and active pharmaceutical ingredients.  Perrigo's consumer-healthcare segment includes over 2,100 store-brand products which are marketed to major national chains such as Wal-Mart, CVS, Walgreens, Sam's Club and Costco.  They also sell to major drug wholesalers.

Lilly is the holder of approved New Drug Application No. 022504 for the manufacture and sale of a transdermal testosterone solution made at a concentration of 30 mg/1.5L, which is marketed by Lilly under the trade name "Axiron."  Axiron is a pharmaceutical drug which raises the amount of testosterone in a patient's body.  Recent sales of Axiron are estimated to be $229 million annually, according to Symphony Health Solutions.  Axiron is subject to Patent Nos. 8,435,944, 8,419,307, 8,177,449 (the "'944 patent," the "'307 patent," and the "'449" patent, respectively).  All three patents have been licensed to Lilly.

Perrigo announced on May 29, 2013 that it had filed an Abbreviated New Drug Application ("ANDA") with the U.S. Food and Drug Administration ("FDA") for approval of a generic version of Axiron.  Prior to filing the ANDA, No. 204255, Perrigo sent a letter to Lilly to inform Lilly that "in Perrigo's opinion and to the best of its knowledge, the '449 patent is invalid, unenforceable, and/or will not be infringed by the commercial manufacture, use, sale, or importation of the drug product described in Perrigo's ANDA."  Perrigo sent similar letters regarding the '307 and '944 patents.

After receiving the letter, Lilly filed suit alleging infringement of the three patents.  It states in its complaint that the '944 patent claims, inter alia, methods of increasing the testosterone blood level of an adult male by applying a transdermal drug-delivery composition that contains testosterone.  The '307 patent includes in its claims a method of increasing the level of testosterone in the blood by applying a liquid pharmaceutical that contains testosterone.  The claims for the '449 patent include a method of transdermal administration of a physiologically active agent.  All three patents are used in connection with Axiron. 

Lilly's complaint lists the following claims:

·         Count I for Patent Infringement (Direct Infringement of U.S. Patent No. 8,435,944)

·         Count II for Patent Infringement (Inducement to Infringe U.S. Patent No. 8,435,944)

·         Count III for Patent Infringement (Contributory Infringement of U.S. Patent No. 8,435,944)

·         Count IV for Patent Infringement (Direct Infringement of U.S. Patent No. 8,419,307)

·         Count V for Patent Infringement (Inducement to Infringe U.S. Patent No. 8,419,307)

·         Count VI for Patent Infringement (Contributory Infringement of U.S. Patent No. 8,419,307)

·         Count VII for Patent Infringement (Direct Infringement of U.S. Patent No. 8,177,449)

·         Count VIII for Patent Infringement (Inducement to Infringe U.S. Patent No. 8,177,449)

·         Count IX for Patent Infringement (Contributory Infringement of U.S. Patent No. 8,177,449)

·         Count X for Declaratory Judgment (Infringement of U.S. Patent No. 8,435,944)

·         Count XI for Declaratory Judgment (Infringement of U.S. Patent No. 8,419,307)

·         Count XII for Declaratory Judgment (Infringement of U.S. Patent No. 8,177,449)

Lilly's lawsuit asks for an injunction to stop Perrigo from producing the generic version of Axiron until the expiration of Lilly's three patents-in-suit.  In addition, Lilly asks that the court declare the three patents to be valid and enforceable; that Perrigo infringed upon all three by, inter alia, submitting ANDA No. 204255 to obtain approval to commercially manufacture, use, offer for sale, sell or import its generic version of the drug into the United States; that Perrigo's threatened acts constitute infringement of the three patents; that FDA approval of Perrigo's generic drug be effective no sooner than the expiration date of the patent that expires last; that this is an exceptional case; and for costs and attorneys' fees.

Practice Tip: The FDA's ANDA process for generic drugs has been abbreviated such that, in general, the generic drug seeking approval does not require pre-clinical (animal and in vitro) testing.  Instead, the process focuses on establishing that the product is bioequivalent to the "innovator" drug that has already undergone the full approval process.  The statute that created the abbreviated process, however, had also created some interesting issues with respect to the period of exclusivity.  For an interesting look at some of these issues, see here. 

Continue reading "Eli Lilly Sues Perrigo for Patent Infringement of Axiron" »

June 10, 2013

Patent Trolls - A Growing Problem Receives National Attention

Litigation by patent-assertion entities ("PAEs," commonly known as "patent trolls") has skyrocketed in the last two years.  A chart released by the White House in a June 2013 report entitled "Patent Assertion and U.S. Innovation" demonstrates that such trolls now file over 60% of all patent-infringement lawsuits.  (The red portion of the bars shows patent lawsuits brought by PAEs.)

Patent-Trolls-Chart.bmpThe patent-trolling business model includes no productive operations.  Instead, investors' money is used to purchase patents for the sole purpose of alleging infringement and extracting payment under the threat of litigation.  Because litigation can be very costly, the patent trolls' targets face a difficult decision: settle (typically by buying a license from the troll) or pay significant litigation expenses -- and face the potential of losing at trial, which is somewhat unlikely but where damages can be enormous.  In contrast, the trolls often use contingency-fee attorneys and, thus, have little more at stake in any given lawsuit than a few hundred dollars for a court-filing fee.

Many view this type of litigation with suspicion, if not outright derision.  At least four patent-reform bills are pending in Congress and the Obama Administration recently released a harsh indictment detailing the damage to innovation and the economy caused by the "abusive practices in litigation" committed by patent trolls.  Various measures to curb frivolous patent litigation have been suggested, including increasing transparency of patent ownership and establishing a website through the U.S. Patent and Trademark Office to inform patent-troll victims of their rights. 

Perhaps most telling, though, are the opinions of the most prominent patent judge in the nation, Randall Rader, the Chief Judge for the U.S. Court of Appeals for the Federal Circuit, which hears the appeals for all trial-court judgments involving patent infringement.  In an opinion piece in the New York Times, Chief Judge Rader accused trolls of not "fighting fairly," filing a "vast number of frivolous patent lawsuits," and "using the threat of litigation cost, rather than the merits of a claim, to bully a defendant into settling." 

These manipulations of the legal system, he says, have cost defendants and taxpayers tens of billions of dollars each year and have "slowed the development of new products, increased costs for businesses and consumers, and clogged our judicial system."  His solution is simple.  He urges courts to use the power they already possess: to look for abusive patent litigation and shift the costs of a frivolous lawsuit -- which routinely exceed $1 million for a matter taken through trial -- to the entity which brought the matter to court. 

Practice Tip: Intellectual-property trolling isn't limited to patent trolling.  For examples of copyright trolling, see here, here and here.

June 7, 2013

CordaRoy's Originals Sues Lovesac for Infringement of Patented Bag-Bed Assembly

Evansville, Ind. -- CordaRoy's Originals, Inc. of Gainesville, Fla. ("CordaRoy's") Corda-Roys-Logo.JPGhas sued The Lovesac Corporation of Stamford, Conn. ("Lovesac") alleging infringement of Patent No. 7,131,157, "Bag Bed Assembly," (the "'157 Patent") which has been issued by the U.S. Patent Office.

Patent lawyers for CordaRoy's filed a patent infringement suit alleging that Lovesac has been and continues to infringe on CordaRoy's '157 Patent for a bag-bed assembly by using, selling, offering to sell, and/or importing a "knock-off" bag-bed assembly which embodies the patented invention.  It is also alleged that Lovesac has induced others to do likewise.  CordaRoy's asserts that the claimed infringement has been, and continues to be, intentional, willful and deliberate. 

LoveSacLogo.JPGIn its complaint, CordaRoy's asks for a judgment that the '157 Patent has been infringed; that Lovesac be required to account for all of its profits and advantages realized from the alleged infringement of the '157 Patent; for an award of lost profits and a reasonable royalty; for an award of treble damages upon a finding of willful, intentional, and deliberate infringement; for an injunction against further actions of infringement; for pre-judgment interest; and for costs and attorney's fees.

A jury trial has been demanded.

Practice Tip: If a court finds that a patent has been infringed upon, it may then consider the additional issue of whether the infringement was willful.  Infringing behavior that continued despite an allegation of infringement can support such a finding.  The determination that an infringement was "willful" can, in turn, increase damages significantly.

Continue reading "CordaRoy's Originals Sues Lovesac for Infringement of Patented Bag-Bed Assembly" »

June 6, 2013

Southern District of Indiana Dismisses Declaratory Judgment Suit

Indianapolis, Ind. -- The Southern District of Indiana has dismissed a declaratory judgment suit filed by ZPS America, LLC of Marion County, Ind. ("ZPS") holding that it was an ZPSLogo.JPGimpermissible attempt to secure its preferred forum in anticipation of litigation that Hammond Enterprises, Inc. of Pittsburg, Calif. ("Hammond") had promised to initiate imminently. 

ZPS manufactures the Mori-Say TMZ 642 CNC machine ("TMZ machine"), a high-precision lathe that can be configured to manufacture various precision parts.  In early 2009, after discussing its requirements, Hammond purchased two TMZ machines from ZPS.  Accounts vary regarding whether the TMZ machines ever performed as had been promised.  Attempts were made by the parties and their attorneys to resolve the issues with the machines but settlement discussions broke down in June 2012.  

HammondEnterprisesLogo.JPGOn June 4, 2012, Hammond's lawyer sent ZPS a letter stating that the machines had been misrepresented and that Hammond was only interested in "hearing back from you...that ZPS is prepared to make arrangements to accept the return of both machines.  If we do not hear from you by Friday, June 15 [2012], that you are prepared to accept their return, we have been authorized to file a lawsuit against ZPS and will proceed to do so." 

On June 14, 2012, one day before the deadline in Hammond's letter, ZPS filed suit against Hammond in Marion Circuit Court, an Indiana state court.  Its complaint was for damages and declaratory judgment.  It asked that the court declare that Hammond had accepted the machines and was not entitled to revoke that acceptance; its damages claim arose from nonpayment by Hammond of amounts due for filter systems that had been purchased for the TMZ machines.  Notice of that suit was served on June 26, 2012. 

On July 10, 2012, Hammond filed a lawsuit against ZPS in the Northern District of California, seeking damages based on claims for negligent misrepresentation, revocation of acceptance, breach of contract, breach of express warranty, and breach of implied warranty.  On July 12, 2012, Hammond served ZPS with a summons and complaint.  On that same day, Hammond removed the action filed by ZPS in state court to the Southern District of Indiana, asserting diversity jurisdiction. 

Hammond argued to the Indiana federal court that it should exercise its discretion to dismiss the complaint on the grounds that ZPS "raced to the courthouse" to deprive Hammond, the "natural plaintiff," of the forum of its choosing. 

The Indiana federal court held that ZPS' declaratory judgment action was impermissible, as it had been filed in anticipation of litigation, beating Hammond to the courthouse by filing the day before the deadline to settle that had been set by Hammond.  The court further held that the additional state-law claim for breach of contract that ZPS had asserted did not secure a place for it in the Indiana court. 

The court cited three reasons for its decision: (1) the fact that a plaintiff filed a declaratory judgment action first does not give it a right to choose the forum; (2) the plaintiff's additional claims for affirmative or coercive relief may be filed as counterclaims in the second-filed action; and (3) the plaintiff should not be rewarded for filing a declaratory judgment action as a pre-emptive strike.  The court declined to exercise jurisdiction over the matter and dismissed the case without prejudice.  

Practice Tip 

Declaratory judgment actions are frequently filed in intellectual-property matters, especially patent litigation.  Such a suit allows the potential defendant not only to choose its own forum, to the extent that the forum is consistent with jurisdictional restrictions, but also to remove an ever-present cloud of potential litigation and potential damages for patent infringement that may be continuing to accrue. 

The Declaratory Judgment Act provides that "any court of the United States, upon the filing of an appropriate pleading, may declare the rights and other legal relations of any interested party seeking such declaration, whether or not further relief is or could be sought."  A federal district court may, in its discretion, decline to hear a case brought under the Act, even if the court has subject matter jurisdiction. 

In general, if two actions are pending in two different courts that concern the same general claims, the case filed first takes priority.  However, the Seventh Circuit has never adhered to a rigid first-to-file rule.  In addition, courts generally give priority to the coercive action (such as an action for damages or an injunction) over the declaratory judgment action, regardless of which case was filed first. 

Courts also depart from the first-to-file rule if, as was true in this case, the declaratory judgment action is filed in anticipation of litigation by the other party.  Here, rather than responding to Hammond regarding its letter, which contained a plain declaration of intent to file suit with a deadline for a response, ZPS filed suit.  Only after securing a favorable forum did ZPS offer to negotiate a settlement.  It was this conduct that the court held justified a dismissal of the declaratory judgment action as an improper anticipatory filing.

Continue reading "Southern District of Indiana Dismisses Declaratory Judgment Suit" »

June 4, 2013

169 Trademark Registrations Issued to Indiana Companies in May, 2013

The US Trademark Office issued the following  trademark registrations to persons and businesses in Indiana in May, 2013, based on applications filed by Indiana Trademark Attorneys:

Reg. Number Mark Click to View
1 4332704 IRIS View
3 4344545 IDREADER View
6 4342670 View
8 4342547 View
9 4342402 AIR DRIVE View
10 4342246 ROCKREVOLT View

Continue reading "169 Trademark Registrations Issued to Indiana Companies in May, 2013" »

June 3, 2013

Patent Office Issues 121 Patents To Indiana Citizens in May, 2013

The US Patent Office issued the following 121 patent registrations to persons and businesses in Indiana in May, 2013, based on applications filed by Indiana Patent Attorneys:






Faucet body












Faucet cover






Necklace web key



Insulin pump programming software for selectively modifying configuration data



Systems and apparatuses for testing blood glucose measurement engines



Method and system for determining the difference between pre-prandial and post-prandial blood glucose values

Continue reading "Patent Office Issues 121 Patents To Indiana Citizens in May, 2013" »

May 29, 2013

Dan's Comp Sues Ian Smith for Trademark Infringement in Facebook Advertisement

Evansville, Ind. -- Trademark lawyers for XP Innovation, LLC d/b/a Dan's Comp ("Dan's Comp") of Mt. Vernon, Ind. sued Ian Smith ("Smith") of Massillon, Ohio alleging that he infringed various trademarks owned by Dan's Comp, Registration Nos. 2,176,911, 2,176,580, 2,607,447, 3,853,112, 3,940,083, 3,957,948, 4,074,705 and 4,101,708, which have been registered with the U.S. Trademark Office.

Dan's Comp owns and operates one of the world's largest BMX bicycle stores.  It also DansComLogo.JPGowns related trademarks registered in connection with sales of bicycles and bicycle-related goods.  These marks include "Dan's," "Dan's Competition," "Dan's BMX" and "high speed mail order."  Dan's Comp also owns trademarks to "Dan's Comp" with a lightning-bolt graphic and to the same lightning-bolt graphic and a similar lightning-bolt graphic as separate marks.

In its complaint, Dan's Comp alleged that it uses its marks in connection with bicycles and bicycle-related goods and services in all fifty states, the District of Columbia, and throughout the world.  It further claimed that it spends tens of thousands of dollars each year to advertise and promote the Dan's Comp marks and the associated goods and services in the United States and throughout the world.  It asserts that, as a result of its use of the Dan's Comp marks, the marks have developed significant goodwill in the market.

This lawsuit pertains to an advertisement that Dan's Comp claims that Smith placed on Facebook.com.  The advertisement read "Free Bike From Dans [sic] Comp."  Users who clicked on the advertisement were redirected to a survey website, which was alleged to have been designed to appear as if it were affiliated with Dan's Comp through the unauthorized use of the Dan's Comp marks.  Users were prompted to answer survey questions regarding their buying habits in relation to Dan's Comp goods and services. 

At the conclusion of the survey, users were prompted to enter their email addresses and mobile phone numbers.  Immediately afterward, a text message containing an "offer" was sent to each user's mobile number.  Various offers included an "Amazing Facts Mobile Alert" for $9.99 per month and a membership to the "Mobile Tunez Club," also for $9.99 per month.  The text message also included a PIN number that was to be entered on the website addressed "http://surveysallday.com/bmx/winner.php" in a box on a page entitled "SCORE YOUR BIKE."  Apparently, entry of the four-digit pin would register the user for the service described in the text message.  It is further claimed that no free bicycles were provided to any users.  Allegedly, thousands of individuals entered their personal information on the survey website.

Continue reading "Dan's Comp Sues Ian Smith for Trademark Infringement in Facebook Advertisement" »

May 28, 2013

Patent Office Finalizes "After Consideration" Pilot Rules

Washington, D.C. -- Indiana inventors can now take advantage of new Patent Office procedure by having their patent attorneys file the appropriate paperwork.  The USPTO launched the USPTO-Logo.JPGAfter Final Consideration Pilot 2.0 (AFCP 2.0) on May 19, 2013. Designed to be more efficient and effective than the AFCP, AFCP 2.0 is part of the USPTO's on-going efforts towards compact prosecution and increased collaboration between examiners and stakeholders.

"Compact prosecution remains one of our top goals," said Teresa Stanek Rea, Acting Under Secretary of Commerce for Intellectual Property and Acting Director of the USPTO. "As with the original AFCP pilot, the new AFCP 2.0 pilot allows additional flexibility for applicants and examiners to work together and provides even greater opportunity for communication after final than the original pilot."

Like AFCP, AFCP 2.0 authorizes additional time for examiners to search and/or consider responses after final rejection. Under AFCP 2.0, examiners will also use the additional time to schedule and conduct an interview to discuss the results of their search and/or consideration with you, if your response does not place the application in condition for allowance. In this way, you will benefit from the additional search and consideration afforded by the pilot, even when the results do not lead to allowance.

In addition, the procedure for obtaining consideration under AFCP 2.0 has been revised. The revised procedure focuses the pilot on review of proposed claim amendments and allows the USPTO to better evaluate the pilot.

To be eligible for consideration under AFCP 2.0, Indiana patent applicants must file a response under 37 CFR §1.116, which includes a request for consideration under the pilot (Form PTO/SB/434) and an amendment to at least one independent claim that does not broaden the scope of the independent claim in any aspect.  A notice published in the Federal Register at 78 Fed. Reg. 29117 has a complete description of how to request consideration under AFCP 2.0. As was the case with the AFCP, examiners will continue to use their professional judgment to decide whether the response can be fully considered under AFCP 2.0.  This will include determining whether any additional search is required and can be completed within the allotted time, in order to determine whether the application can be allowed.


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May 24, 2013

Automated Products Sues Norco for Infringement of Patented Roof-Support Rafters

South Bend, Ind. - Patent lawyers for Automated Products International, LLC ("API") of LaGrange, Ind. sued alleging that Norco Industries, Inc. ("Norco") of Elkhart, Ind. infringed NorcoLogo.JPGPatent No. 7,134,711 (the "'711 Patent") which has been issued by the U.S. Patent Office. 

The '711 Patent is directed to recreational-vehicle roof-support rafters.  API alleges that Norco has been and is currently infringing the patent.  API also asserts that through continuous marking of its products, it has provided "constructive notice of [Norco's] infringement."

API seeks a judgment declaring that Norco has infringed the '711 Patent; damages equal to at least a reasonable royalty; treble damages upon a finding of willful and deliberate infringement; attorneys' fees upon a finding that the case is exceptional; and an injunction.

Practice Tip:  The law of the "reasonable royalty" has been in transition recently.  The "25% rule," an approach that allocated 25% of the profits from an infringement to the patentee and the remaining 75% to the infringer, has been abandoned.  Long used in federal courts to establish a reasonable royalty as compensation for patent infringement under § 284 of the Patent Act, it was rejected by the Federal Circuit in 2011.  In its ruling in Uniloc v. Microsoft, the court held: "the 25 percent rule of thumb is a fundamentally flawed tool for determining a baseline royalty rate in a hypothetical negotiation.  Evidence relying on the 25 percent rule of thumb is thus inadmissible under Daubert and the Federal Rules of Evidence, because it fails to tie a reasonable royalty base to the facts of the case at issue."

Continue reading "Automated Products Sues Norco for Infringement of Patented Roof-Support Rafters" »

May 23, 2013

Keystone Management and Lockridge Sue Alleging Copyright Infringement of Architectural Work

Indianapolis, Ind. -- Copyright lawyers for Keystone Management Systems, Inc. f/k/a Keystone Builders Resource Group, Inc. ("Keystone Management") and Lockridge Homes-Indianapolis, LLC ("Lockridge"), both of Richmond, Va., filed a copyright infringement lawsuit LockridgeLogo.JPGalleging William Clyde Moore, Jr. ("Moore") and Carol Cooper ("Cooper"), d/b/a DrafTech, both of Indianapolis, Ind., infringed the copyrighted work "Birkshire II" (architectural work: 1-396-233; and technical drawings: VA 1-396-224), which is registered with the U.S. Copyright Office.

Keystone Management is in the business of creating, designing, producing, distributing and marketing original architectural working drawings, architectural works and related technical drawings ("the Keystone Designs").  Lockridge is in the business of constructing, marketing and selling distinctive single-family residential homes.  Keystone Management has granted to Lockridge the right to use the Keystone Designs.

Moore allegedly asked to purchase one of the Keystone Designs but no agreement was reached.  He also allegedly discussed various home plans with Lockridge for the purpose of constructing a single-family home on his property.  As a part of this discussion, Lockridge provided Moore with a rendering of the floor plan for the Birkshire II design.  Moore then allegedly provided these plans to Cooper for the purpose of constructing a home in the Birkshire II design.  Construction is either underway or completed.

Keystone Management and Lockridge sued in the Southern District of Indiana.  They list two counts in their complaint: copyright infringement and unjust enrichment.  They seek an injunction; impoundment and destruction of any homes built from the Keystone Designs; for damages up to $150,000 for each infringement; costs and fees.

We have blogged about similar cases here, here and here. 

Practice Tip #1: Copyright protection extends to any architectural work created on or after December 1, 1990, but architectural designs embodied in buildings constructed prior to that date are not eligible for copyright protection. 

Practice Tip #2: The second claim, for unjust enrichment, is preempted by The Copyright Act.

Continue reading "Keystone Management and Lockridge Sue Alleging Copyright Infringement of Architectural Work" »

May 22, 2013

J & J Sports Sues Five Restaurants for Unauthorized Interception and Broadcast of Championship Fight

Indianapolis, Ind. -- Intellectual property lawyers for J & J Sports Productions, Inc. ("J&J Sports") of Campbell, Calif. have sued five Indianapolis restaurants and their owners in the Southern District of Indiana for illegally displaying the 2011 World Boxing Organization Welterweight J&JSportsLogo.JPGChampionship Fight.

J & J Sports was granted exclusive nationwide commercial rights to the closed-circuit distribution of the "Manny Pacquiao v. Shane Mosley, WBO World Welterweight Championship Fight" Program ("the Program"), which was telecast nationwide on Saturday, May 7, 2011. 

In five separate but similar complaints, J&J Sports has alleged such wrongful acts as interception, reception, publication, divulgence, display, exhibition, and tortious conversion of the Program.  The claims have been made both against the restaurants and as personal liability claims against the owners.  The five restaurants that have been sued are: Fandango's Night Club, La Favorita Mexican Restaurant, El Rey Del Taco Mexican Restaurant, Taqueria Night Club and Costa Brava Mexican Restaurant.  Of these, at least one, Fandango's Night Club, has been sued before under similar circumstances.

Each group of defendants has been accused of violating 47 U.S.C. § 605 and 47 U.S.C. § 553.  Each complaint also lists a count of conversion.  Among its assertions of wrongdoing, J&J Sports has alleged interception under 47 U.S.C. 605, which is a different cause of action from copyright infringement. The interception claim has a two-year statute of limitations, which explains why the complaints were filed on May 6, 2013.

The complaints seek statutory damages of $100,000 for each violation of 47 U.S.C. § 605; $10,000 for each violation of 47 U.S.C. § 553; $50,000 for each willful violation of 47 U.S.C. § 553; costs and attorney fees.

In 2011, J&J Sports filed 708 lawsuits.  We have blogged before about J&J Sports here, here and here.

Practice Tip: All of these lawsuits were filed on the eve of the two-year anniversary of the program that the defendants are alleged to have illegally broadcast.  When Congress passed the Cable Communication Act, a statute of limitations was not included.  Some federal courts have determined that a two-year statute of limitation is appropriate while other federal courts have used a three-year statute of limitations.

Overhauser Law Offices, the publisher of this website, has represented several hundred persons and businesses accused of infringing satellite signals.

Continue reading "J & J Sports Sues Five Restaurants for Unauthorized Interception and Broadcast of Championship Fight" »

May 20, 2013

U.S. Supreme Court Rules Against Indiana Farmer in "Roundup Ready" Soybean Patent Decision

Washington D.C. -- The U.S. Supreme Court has ruled that "patent exhaustion" does not bar an infringement claim against Indiana farmer Vernon Bowman for reproducing patented seeds by planting and harvesting second generation seeds without the patent holder's permission. MonsantoLogo.JPG Bowman v. Monsanto Co., U.S., No 11-796, 5/13/2013.  Monsanto produces and sells patented soybean seed that is genetically altered to resist its "RoundUp" herbicide. Bowman is a farmer who purchased soybean for planting from a grain elevator, expecting that most of the grain elevator soybean would be Monsanto's herbicide-resistant soybean. In the subsequent patent infringement brought by Monsanto, Bowman argued that Monsanto's sale of its seed that he ultimately purchased from the grain elevator exhausted any patent rights in the seed. The argument was rejected by both the District Court and the Federal Circuit, and the Supreme Court agreed to review the case.

Patent Exhaustion Only for Sold Article

Under the patent exhaustion doctrine, an authorized sale of a patented product cuts off the patent owner's right to control of that product, because the sale of that product fulfills the patent law by providing a reward to the patentee.  However, this limitation on patent rights applies only to the particular article sold.  If the purchaser could make and sell endless copies, the patent would effectively protect just a single sale.

In this case, the patent exhaustion doctrine provides Bowman with the right to use the purchased product in several different ways without Monsanto's permission, including resale, human consumption or animal consumption of the product. However, it does not permit Bowman to make additional patented soybeans without Monsanto's permission.

Bowman contended that his use of the purchased seed was covered by the patent exhaustion doctrine because that is the normal way farmers use seed, and that Monsanto seeks an impermissible exception to the exhaustion doctrine for patented seeds and other self-replicating technologies.

The Court rejected the argument, pointing out that it is Bowman who seeks an unprecedented exception to the well-settled rule that the exhaustion doctrine does not extend to the right to make a new product.

Continue reading "U.S. Supreme Court Rules Against Indiana Farmer in "Roundup Ready" Soybean Patent Decision" »

May 17, 2013

Purdue University Celebrates Innovation

Lafayette, Ind. -- Purdue University students are creating and patenting products while pursuing their degrees.  Purdue is celebrating the inventiveness of five of those students: Julia Alspaugh, Zachary Amodt, Sean Connell, Andrew Glassman and Anne Dye Zakrajsek.

Julia Alspaugh, a mechanical engineer in her second year as a master's student, researches biomedicine.  She says, "I see mechanical engineering as a broad field that analyzes the world's processes and how the machinery and technology that makes them work can be simplified and improved." 

Julia is part of a large, interdisciplinary team seeking numerous patents related to the use of novel, resorbable biomaterials to create fixation devices for next-generation orthopedic devices, such as the plates, pins and screws used to set broken limbs or repair damaged tissues and joints.

"These devices would provide support while the bone and joint healed, for example, then degrade within a few years without leaving any foreign or potentially toxic materials in the body," she explains.  "It's a similar concept to the dissolving stitches now used in many dental surgeries, but on a larger and more complex scale."

For Julia, the most surprising thing she's encountered in the patent process is unrelated to engineering or biomedicine.  "Learning how to make sure what we are working on is novel and patentable has been more challenging than expected," she says. "It may be an awesome new technology, but we also have to keep in mind its marketability.  It requires communication between many different people with different interests and ways of doing things."

Zachary Amodt dropped out of school to join the military after September 11, 2001.  Ten years later, he returned and is now holding a provisional patent inspired by his experience as a combat medic in war zones all over the world.

Continue reading "Purdue University Celebrates Innovation" »

May 16, 2013

Serenity Springs Prevails Against Allegations of Trademark Infringement and Cybersquatting

Indianapolis, Ind. -- The Indiana Court of Appeals has vacated a trial court's judgment in favor of the LaPorte County Convention and Visitors Bureau (the "Bureau") of LaPorte, Ind., holding that neither trademark infringement nor cybersquatting had been committed by Serenity Springs ("Serenity") of LaPorte, Ind.

SerenitySpringsLogo.JPGSerenity operates a resort in LaPorte County.  The Bureau is a special-purpose governmental unit charged with representing the visitor industry by marketing to potential visitors to the LaPorte area.

On September 9, 2009, the Bureau announced at a public meeting that it planned to adopt the phrase "Visit Michigan City LaPorte" as its branding identifier for the area.  A representative of Serenity was in attendance.  Immediately afterward, an employee for Serenity registered the domain name "visitmichigancitylaporte.com" and set it up to redirect internet traffic to Serenity's website.

LaPorteCountyLogo.JPGThe Bureau sent a cease-and-desist letter claiming trademark infringement and cybersquatting.  Serenity responded that (1) it had registered and begun using the domain name before the Bureau had made any commercial use of it and (2) the designation was not protectable as a trademark because it was merely descriptive and had not acquired distinctiveness.

In April 2010, the Bureau filed an application with the Indiana Secretary of State to register "Visit Michigan City LaPorte" as a trademark under the Indiana Trademark Act.  In its application, the Bureau indicated that it had first used the mark in commerce on September 9, 2009.  The application was approved.  Nonetheless, Serenity continued using the visitmichigancitylaporte.com domain name.

The Bureau sued Serenity in the LaPorte Superior Court alleging, inter alia, trademark infringement, cybersquatting and unfair competition by Serenity.  The trial court permanently enjoined Serenity from using "Visit Michigan City LaPorte" and ordered the transfer of the domain name "visitmichigancitylaporte.com" to the Bureau.

Serenity appealed the trial court's holding that it had committed trademark infringement and cybersquatting.  The trial court had held that, due to the Bureau's status as a governmental entity, it was entitled to a different application of trademark law.  Specifically, it held that there was a lesser requirement for using the mark to acquire trademark rights.

The appellate court disagreed.  It has long been held that the exclusive right to use a mark is acquired through adoption and use of the mark in commerce.  The appellate court also held that this mark was clearly geographical in nature and that it was "difficult to conceive of a mark that falls more squarely within the category of geographically descriptive marks."  Geographically descriptive designations generally fall within the descriptive category; thus, to be protected, the must have acquire secondary meaning.

The trial court considered the entirety of the time that the Bureau had been using the mark in considering whether the Bureau had established secondary meaning.  It found that such secondary meaning had been established.  However, the correct test for secondary meaning is to evaluate whether secondary meaning had been established by the senior user immediately prior to the time and place that the junior user began to use the mark.  As this was, on its face, entirely unsupported by evidence, the appellate court held that the trial court erred in its determination that the Bureau had acquired secondary meaning in the mark.  The appellate court reversed the trial court's judgment, holding that the Bureau had not established that it held a valid and protectable trademark in the designation "Visit Michigan City LaPorte."

The appellate court did, however, point out that additional claims had been made by the Bureau which had not been reached by the trial court.  One of the claims, unfair competition, does not require the existence of a protectable trademark.  Instead, it is an open-ended category of torts designed to protect "commercial values."  The appellate court remanded with instructions to the trial court to vacate its judgment as to trademark infringement and cybersquatting and to adjudicate the Bureau's remaining claims. 

Practice Tip #1: While the Indiana Trademark Act and the Lanham Act have many similarities, the former does not provide all of the protections afforded by the latter.  While the Lanham Act provides that federal registration of a mark provides prima facie evidence of its validity, the Indiana Trademark Act contains no such provisions.  A certificate of registration with the Indiana Secretary of State is proof of registration only (although such a registration is necessary to support a claim of infringement under the Indiana Trademark Act).

Practice Tip #2: One wonders if the entirety of this litigation might have been avoided by taking one simple step: registering the domain name before making the public announcement.

Continue reading "Serenity Springs Prevails Against Allegations of Trademark Infringement and Cybersquatting" »

May 15, 2013

Federal Circuit Denies Petition by ArcelorMittal France for Rehearing in Patent Infringement Case

Washington, D.C. -- The United States Court of Appeals for the Federal Circuit denied the petition of ArcelorMittal for a rehearing in its patent infringement lawsuit against AK Steel involving ULTRALUME®.

AK Steel produces flat-rolled carbon and stainless and electrical steels.  Their products are primarily for automotive, infrastructure, manufacturing, construction, and electricity-generation and distribution markets. The company, headquartered in West Chester, Ohio, also employs people in Indiana, Pennsylvania, and Kentucky.

ArcelorMittal is a multinational steel manufacturing corporation headquartered in Avenue de la Liberté, Luxembourg. It is the world's largest steel producer, with an annual crude steel production of 97.2 million tons as of 2011.

At issue in this suit was a claim of patent infringement by ArcelorMittal France and ArcelorMittal Atlantique et Lorraine (collectively "ArcelorMittal") against AK Steel et al. of Patent No. 6,296,805, entitled "Coated hot- and cold-rolled steel sheet comprising a very high resistance after thermal treatment," ("the '805 patent") which has been issued by the U.S. Patent Office. 

The '805 patent covers boron steel sheeting with an aluminum-based coating applied after rolling the sheet to its final thickness. The steel is used for "hot-stamping," a process which involves rapidly heating the steel, stamping it into parts of the desired shape, and then rapidly cooling them.  The rapid heating and cooling alters the crystalline structure of the steel, converting it to austenite and then martensite.  By altering the steel's microstructure in this manner, hot-stamping produces particularly strong steel.  Because hot-stamped steel is so strong, parts created using the process can be thinner and lighter than steel parts produced with other methods while being just as strong.

ArcelorMittal sued AK Steel and two other steel producers in the United States District Court for the District of Delaware, alleging infringement of the '805 patent.  In 2011, a jury found that defendants AK Steel, Severstal Dearborn, Inc., and Wheeling-Nisshin Inc. had not infringed ArcelorMittal's patent and that the asserted claims were invalid as anticipated and obvious.

ArcelorMittal appealed from the judgment of the trial court, challenging both the district court's claim construction and the jury's verdict.

The federal circuit upheld the district court's claim construction in part and reversed it in part. It also reversed the jury's verdict of anticipation.  With respect to obviousness, a new trial was required because a claim-construction error by the district court prevented the jury from properly considering ArcelorMittal's evidence of commercial success.

Despite the mixed results - partially affirming, partially reversing, partially vacating and remanding for a new trial - the decision of the federal circuit has confirmed that AK Steel did not infringe Arcelor's patent and can sell Ultralume, its aluminized boron steel product.

Practice Tip: Patent decisions of the Federal Circuit, a federal appellate court, are unique in that they are binding precedent throughout the United States.  Decisions of the Federal Circuit can be superseded only by decisions of the U.S. Supreme Court or by legislation.  As such, Federal Circuit decisions are often the final word nationwide on the issues of patent law that the court decides.  In contrast, the authority of other federal appellate courts is restricted by geographic location.  In those courts, the federal common law often varies among the circuits (a "circuit split"). 

Continue reading "Federal Circuit Denies Petition by ArcelorMittal France for Rehearing in Patent Infringement Case" »