January 27, 2014

Eli Lilly Sues Par Pharmaceutical Asserting Patent Infringement of Effient®

Indianapolis, Indiana - An Indiana patent attorney sued in the Southern District of Indiana on behalf of Eli Lilly and Company of Indianapolis, Indiana; Daiichi Sankyo Co., Ltd. of Tokyo, Japan ("Daiichi Sankyo"); Daiichi Sankyo, Inc. of Parsippany, New Jersey ("DSI"); and Ube Industries, Ltd. of Yamaguchi, Japan alleging that Par Pharmaceutical Companies, Inc. ("Par Pharmaceutical Companies") and Par Pharmaceutical, Inc. ("Par"), both of Woodcliff Lake, New Jersey, (collectively "Par Pharmaceutical") infringed Medicinal Compositions Containing Aspirin, Patent No. 8,404,703 (the "'703 patent") and Method of Treatment and Coadministration of Aspirin and Prasugrel, Patent No. 8,569,325 (the "'325 patent"), which have been issued by the U.S. Patent Office.

diagram.pngThis is a civil action for patent infringement. It arises out of the filing by Defendant Par of an Abbreviated New Drug Application ("ANDA") with the United States Food and Drug Administration ("FDA") seeking approval to manufacture and sell generic versions of two of Lilly's pharmaceutical products, Effient® 5mg and Effient® 10mg tablets, prior to the expiration of Daiichi Sankyo's and Ube's U.S. patents, which purportedly cover methods of using Effient® products. Lilly asserts that it holds an exclusive license to these products. DSI currently co-promotes Effient® products in the United States with Lilly.

Effient® products were approved by the FDA for the reduction of thrombotic cardiovascular events in certain patients with acute coronary syndrome (ACS) who are to be managed with percutaneous coronary intervention (PCI, or angioplasty). The instructions accompanying Effient® products state that patients taking Effient® products should also take aspirin. The use of Effient® products in combination with aspirin for the reduction of thrombotic cardiovascular events in patients with ACS who are to be managed with PCI is covered by the claims of the '703 and '325 patents.

Par has submitted an Abbreviated New Drug Application (the "Par ANDA") to the FDA pursuant to 21 U.S.C. § 355(j), seeking approval to market a generic version of Lilly's product for oral administration (the "Par Products") in the United States.

Plaintiffs assert that Par will knowingly include with the Par Products instructions for use that substantially copy the instructions for Effient® products, including instructions for administering the Par Products with aspirin as claimed in the '703 and '325 patents. Moreover, Plaintiffs contend that Par knows that the instructions that will accompany the Par Products will induce and/or contribute to others using the Par Products in the manner set forth in the instructions. Plaintiffs also contend that Par specifically intends that health care providers, and/or patients will use the Par Products in accordance with the instructions provided by Par to directly infringe one or more claims of the '703 and '325 patents. Par therefore will actively induce and/or contribute to infringement of the '703 and '325 patents, state Plaintiffs.

In the complaint, the Indiana patent lawyer for Plaintiffs listed the following counts:

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

Plaintiffs ask the court for judgment:

A. That Defendants, either individually or collectively, have infringed or will infringe, after the Par ANDA is approved, one or more claims of the '703 patent;
B. That Defendants, either individually or collectively, have infringed or will infringe, after the Par ANDA is approved, one or more claims of the '325 patent;
C. That, pursuant to 35 U.S.C. § 271(e)(4)(B), Par and Par Pharmaceutical Companies be permanently enjoined from making, using, selling or offering to sell either or both of the Par Products within the United States, or importing either or both of the Par Products into the United States prior to the expiration of the '703 and '325 patents;
D. That, pursuant to 35 U.S.C. § 271(e)(4)(A), the effective date of any approval of the Par ANDA under § 505(j) of the Federal Food, Drug and Cosmetic Act (21 U.S.C. § 355(j)) shall not be earlier than the latest of the expiration dates of the '703 and '325 patents, including any extensions;
E. A judgment declaring that the '703 patent remains valid and enforceable;
F. A judgment declaring that the '325 patent remains valid and enforceable;
G. If either Par or Par Pharmaceutical Companies commercially makes, uses, sells or offers to sell either or both of the Par Products within the United States, or imports either or both of the Par Products into the United States, prior to the expiration of either of the '703 and '325 patents, including any extensions, that Plaintiffs will be awarded monetary damages for those infringing acts to the fullest extent allowed by law and be awarded prejudgment interest based on those monetary damages;
H. That this case be deemed exceptional under 35 U.S.C. § 285; and
I. That Plaintiffs be awarded reasonable attorney's fees, costs and expenses.

Practice Tip: Lilly is not an infrequent litigant. This may be in part due to the fact that the company is facing a significant patent cliff. Its patent for a former top product, the antipsychotic Zyprexa - which once generated $5 billion in annual revenues - expired in 2011. Its top-selling drug of 2013, the antidepressant Cymbalta, lost patent protection last year. The patent on blockbuster Evista, a drug for breast cancer and osteoporosis, will expire this March.

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January 24, 2014

USPTO Ranks #1 in Best Places to Work in the Federal Government

WASHINGTON, D.C. - The federal government's annual employee survey finds that the USPTO tops the list of 371 federal agency subcomponents.

uspto-picture.gifThe U.S. Department of Commerce's United States Patent and Trademark Office ("USPTO") was named number one out of 300 agency subcomponents in the 2013 Best Places to Work in the Federal Government rankings released recently by the non-profit Partnership for Public Service ("PPS"). The annual report is based on a survey of more than 700,000 civil servants from 371 federal agencies and subcomponents conducted in 2013 by the Office of Personnel Management ("OPM"). The USPTO has consistently risen in the Best Places to Work rankings since 2009, ranking fifth in its category last year.

"This is a tremendous tribute to the tireless dedication of our hardworking employees, unions, and agency leaders," said Commissioner for Patents Margaret A. (Peggy) Focarino (pictured below). "Our employees have faced significant challenges, including the impact of budget peggyLarge.jpgsequestration despite being a fully fee-funded agency, and the completion of our implementation of the Leahy-Smith America Invents Act, the most sweeping overhaul of our nation's patent system in generations. Yet despite those challenges we maintained our upward momentum in being recognized by our employees as a Best Place to Work in the federal government."

One large component of USPTO's success has been its highly successful telework program, which the PPS recognized with a 2012 nomination for its annual Samuel J. Heyman Service to America awards (the Sammies). The agency's telework program improved flexibility in employee work location, reduced examiner turnover to historically low levels, increased examiner productivity, and saved the agency millions each year in overhead costs.

Building collaborative team-based approaches to projects and increasing technical and leadership training opportunities have also improved the morale and effectiveness of USPTO's highly talented workforce. Earlier this year, Commissioner Focarino was named as a 2013 Sammie nominee for coordinating USPTO senior leadership in working with the Patent Office Professional Association ("POPA") union to negotiate and implement historic changes at the agency. These changes give patent examiners more time and flexibility, provide new performance requirements for examiners and managers, and increase employee training and leadership development opportunities.

Over the last two years, the USPTO's Creativity and Innovation Challenge has helped improve operations through collaboration and idea-sharing between the agency and its employees. Developed in partnership by USPTO management, POPA and other unions - the National Treasury Employee Union, Chapter 243 (NTEU 243), and Chapter 245 (NTEU 245) - the challenge established an interactive employee forum encouraging employees to submit and vote on innovative ways to improve the agency.

PPS based its rankings on the 2013 Federal Employee Viewpoint Survey ("EVS"), released in November 2013 by OPM. That survey showed the USPTO with a 73 percent participation rate, and its scores increased across all of the categories measured by the survey - including areas like Effective Leadership and Strategic Management - demonstrating sustained progress during a time of ongoing challenges to employee engagement and satisfaction. Agency leadership is examining EVS category results in depth in order to expand and build on this success.

January 23, 2014

NCAA Heard in Federal Court Again on Antitrust and Right-of-Publicity Issues

Oakland, California - District Judge Claudia Wilkin (pictured) issued a new order regarding in re NCAA Student-Athlete Name & Likeness Licensing Litigation, a putative class action involving theJudgewilkin.bmp Indianapolis-based National Collegiate Athletic Association ("NCAA"). The NCAA's motion to dismiss on, inter alia, copyright and First-Amendment grounds was denied.

In this action, Plaintiffs, a group of twenty-five current and former college athletes who played for NCAA men's football or basketball teams between 1953 and the present, pursued a putative class action against Defendant NCAA. They initially brought claims against Collegiate Licensing Company ("CLC") and Electronic Arts Inc. ("EA") as well, but agreed to settle those claims before this order was issued.

At the time of this order, four of the Plaintiffs (the "Right-of-Publicity Plaintiffs") alleged that the NCAA misappropriated their names, images and likenesses in violation of their statutory and common law rights of publicity. In contrast, the other twenty-one Plaintiffs (the "Antitrust Plaintiffs") alleged that the NCAA violated federal antitrust law by conspiring with EA and CLC to restrain competition in the market for the commercial use of their names, images and likenesses. This order addressed only the latter set of claims, which arise under the Sherman Antitrust Act, 15 U.S.C. § 1 et seq.

To be eligible to compete, the NCAA required student athletes to release in perpetuity all rights to the commercial use of their images. The Antitrust Plaintiffs contend that the "purposefully misleading" release forms then allowed the NCAA to sell or license the athletes' identities to others.

In addition to the release that the athletes had signed, a price-fixing conspiracy/group boycott prevented the athletes from being able to pursue compensation for the licensing of their identities even after they stopped competing. This allegedly interfered with their ability to market "group licensing rights" for their identities in game broadcasts, rebroadcasts and video games. Because many of these Plaintiffs also went on to play professionally, such rights could be of considerable value.

Intellectual property attorneys for the NCAA argued that assertions of a right of publicity of student athletes in the context of game broadcasts were barred by the First Amendment as well as California statute. The court was not persuaded by either argument. On the First Amendment argument, the court held that, while the original broadcast might enjoy protection, "subsequent unauthorized reproductions" did not.

Likewise, the California statute cited by the intellectual property lawyers for the NCAA was not persuasive to the court. That statute provided that the athletes had no right of publicity in the "use of [his or her] name, voice, signature, photograph, or likeness in connection with any news, public affairs, or sports broadcast or account." However, the court held that such right-of-publicity restrictions did not apply to licensing in other states that lacked similar statutes.

The court also rejected the NCAA's copyright-preemption argument on two grounds. First, this was not properly considered under the law of copyright. The athletes were not asserting intellectual property rights under copyright law but rather sought to license their personas. As a persona cannot be copyrighted, copyright preemption did not apply. Moreover, the Plaintiffs' claims were not of simple theft of intellectual property. They also asserted a broader antitrust right - to prevent injury to competition. Citing United States v. Microsoft Corp., 253 F.3d 34, 63 (D.C. Cir. 2001), the court stated, "[I]ntellectual property rights do not confer a privilege to violate the antitrust laws" and denied the NCAA's motion to dismiss.

Practice Tip: The NCAA has been heard before on claims under the Sherman Act. NCAA v. Board of Regents, 468 U.S. 85 (1984). In that decision, the Court acknowledged that the NCAA must be given some leeway to adopt anticompetitive rules violating the Sherman Act, concluding that intercollegiate athletics is "an industry in which horizontal restraints on competition are essential if the product is to be available at all."

Continue reading "NCAA Heard in Federal Court Again on Antitrust and Right-of-Publicity Issues" »

January 22, 2014

Virginia District Court Awards Attorneys' Fees to USPTO

Alexandria, Virginia - The District Court for the Eastern District of Virginia held in ShammasSeal-picture.bmp v. Focarino that the United States Patent and Trademark Office ("USPTO") was entitled to recover attorneys' fees when brought to court for a review of Trademark Trial and Appeal Board ("TTAB") rulings.

An examiner for the USPTO had refused to register a trademark for the term PROBIOTIC for a fertilizer on the grounds that it was a generic term for fertilizers and, in the alternative, was descriptive with no secondary meaning. Plaintiff Milo Shammas brought the matter to the TTAB, which affirmed. Shammas then asked for a review of the TTAB decision under 15 U.S.C. 1071(b)(1) in the District Court for the Eastern District of Virginia.

Summary judgment was granted in favor of the USPTO, which then moved for fees and expenses under Section 21(b)(3) of the Lanham Act. Section 21(b)(3) provides that, in cases such as these, "all the expenses of the proceeding shall be paid by the party bringing the case, whether the final decision is in favor of such party or not."

Shammus argued that it would be improper to award attorneys' fees, as they were not included in the statutory term "expenses." The court was not convinced, however, and held that the plain meaning of "expenses" included both attorneys' fees and other costs. This interpretation, the court explained, was further bolstered by Congress's inclusion of the word "all" before "expenses."

In determining the correct measure of fees due, the court noted that, while using market rates for legal services is appropriate when calculating "reasonable attorneys' fees," an award of "expenses" must be based on the actual salaries (when calculated on a per-hour basis) of the government trademark lawyers who defended the action. Thus, in this case, where the statute provided for "expenses," attorneys' fees were properly based on the actual hourly rate paid to the attorneys.

Practice Tip #1: The American legal system typically requires each party to bear its own litigation expenses, including attorneys' fees, regardless of the outcome of the case.

Practice Tip #2: This fee-shifting decision was a matter of first impression regarding Section 21(b)(3) of the Lanham Act. It held that "expenses" as contemplated therein included attorneys' fees. Moreover, ex parte plaintiffs must pay those expenses whether or not they prevail on the merits.

Practice Tip #3: Section 1071 was characterized as "arguably an odd statute" by the court. The court remarked that the statute "provides unsuccessful trademark applicants with a choice between an appeal to the Court of Appeals for the Federal Circuit on the administrative record, or alternatively, an action in federal district court where the administrative record may be supplemented with new evidence. Congress's decision to allow this choice is odd for several reasons. First, it serves to lessen the trademark applicant's incentive to put her best evidentiary foot forward before the PTO given that if she fails before the PTO, she can supplement the record in the district court. Moreover, Congress no sooner provides this choice than it takes an energetic step to discourage its use by requiring the unsuccessful applicant who files the district court suit under § 1071(b) to pay all expenses of the district court proceeding, win, lose or draw. This could lead to an anomalous result where the applicant must pay the PTO's expenses of the district court proceeding even where the PTO loses in the district court on the administrative record alone and no new evidence is admitted or considered. In this circumstance, there is little reason to saddle the unsuccessful applicant with the PTO's expenses. A second anomalous result is that the statute invites forum shopping. By allowing an action to be filed in a district court in lieu of an appeal to the Court of Appeals for the Federal Circuit, the statute invites an unsuccessful applicant to pick a district court in a favorable circuit because the appeal will be to the circuit in which the district court sits, not to the Court of Appeals to the Federal Circuit."

Practice Tip #4: When determining whether to use market rates or actual attorney-fee expenses in fee-shifting cases, the Seventh Circuit has reached a conclusion similar to the decision in this case. The Seventh Circuit has determined, for example, that it is incorrect to use the prevailing market rate to determine an award of attorneys' fees under 28 U.S.C. § 1447(c) because the statute limited fee awards to "actual expenses, including attorney's fees, incurred." See Wisconsin v. Hotline Indus., Inc., 236 F.3d 363, 367 (7th Cir. 2000).

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January 20, 2014

Granite Ridge Builders Sues for Copyright Infringement by Old Dutch Homes and Homeowners Hollis and Miller

Fort Wayne, Indiana - Indiana copyright attorneys for Granite Ridge Builders, Inc. of Fort Wayne, Indiana sued in the Northern District of Indiana alleging that Ed Hollis and Sharon A. Miller, both of Allen County, Indiana (collectively, the "Hollises"), and Old Dutch Homes Corp. and Edward L. Kouder, both of Harlan, Indiana, infringed the copyrighted home-building plans used in conjunction with a custom home that was built for the Hollises.

FrontElevation.bmpGranite Ridge asserts that it was engaged by the Hollises in part to prepare plans and specifications for use in constructing the Hollises' custom home. It contends that the Hollises, without permission from Granite Ridge Builders, then delivered those plans to Old Dutch Homes and Kouder.

Old Dutch Homes and Kouder (as draftsman) are accused of having used Granite Ridge's copyrighted plans in conjunction with the construction of the Hollises' custom home. Granite Ridge indicates that Defendants Old Dutch Homes and the Hollises continued to construct the home, despite notification by Granite Ridge that they had infringed upon Granite Ridge's copyright in the home-construction plans.

In its complaint, filed by Indiana copyright lawyers, Granite Ridge Builders lists two claims:

• Count I - Copyright Infringement - 17 U.S.C. § 501
• Count II - Contributory Copyright Infringement

Granite Ridge Builders asks for damages in an amount equal to the actual losses it suffered as a result of the alleged copyright infringement.

Practice Tip:

Under 17 U.S.C. § 504, an infringer of a copyright is liable for either (1) the copyright owner's actual damages and any additional profits of the infringer or (2) statutory damages.

If actual damages and profits are sought, the copyright owner is entitled to recover the actual damages suffered by him or her as a result of the infringement, as well as any profits of the infringer that are attributable to the infringement that are not taken into account in computing the actual damages. In establishing the infringer's profits, the copyright owner is required to present proof only of the infringer's gross revenue, and the infringer is required to prove his or her deductible expenses and the elements of profit attributable to factors other than the copyrighted work.

If statutory damages are sought, the copyright owner is entitled to recover, instead of actual damages and profits, an award of statutory damages for all infringements involved in the action, with respect to any one work, for which any one infringer is liable individually, or for which any two or more infringers are liable jointly and severally, in a sum of not less than $750 or more than $30,000 as the court considers just.

In a case where the copyright owner sustains the burden of proving, and the court finds, that infringement was committed willfully, the court in its discretion may increase the award of statutory damages to a sum of not more than $150,000.

Continue reading "Granite Ridge Builders Sues for Copyright Infringement by Old Dutch Homes and Homeowners Hollis and Miller" »

January 17, 2014

Global Patent Filings See Fastest Growth in 18 Years

Geneva, Switzerland - A new World Intellectual Property Organization ("WIPO") report  shows that in 2012 global patent filings increased at their strongest rate in nearly two decades as industrial-design registration notched its best-ever rate of growth. Intellectual untitled.bmpproperty ("IP") filings have sharply rebounded since a 2009 decline at the height of the financial crisis.

The report shows patent filings grew by 9.2% (2.35 million applications filed) in 2012. Utility model ("UM") filings increased by 23.4%, industrial design filings by 17%, and trademark filings by 6.0%.

The 2013 edition of the World Intellectual Property Indicators also shows that, for the first time, China tops the ranking for both the source (filings by China) and the destination (filed in China) for the four types of IP (patents, utility models, trademarks and industrial designs). Of the top five IP offices worldwide, the State Intellectual Property Office of the People's Republic of China ("SIPO") was alone in recording double-digit growth for each of the four types of IP. Continued rapid filing growth in China is the main driver of global IP growth.

"Following the 2009 financial crisis, global intellectual property filings and global economic output have followed diverging paths," said WIPO Director General Francis Gurry. He added, "while economic recovery since the 2009 crisis has been uneven and has failed to bring down unacceptably high levels of unemployment, IP filings have increased at a faster rate than before the crisis."

Patents and Utility Models

Patent filings worldwide grew by 9.2% in 2012, representing the fastest growth recorded in the past 18 years. Following a 3.9% decrease in 2009, patent filings worldwide have now rebounded strongly, with accelerating growth rates - 7.6% in 2010, 8.1% in 2011 and 9.2% in 2012. This was mainly due to strong growth in filings at SIPO. The estimated 2.35 million patent filings worldwide in 2012 consisted of 1.51 million filed by residents and 830,000 by non-residents.

Among the top 20 IP offices, SIPO (+24%) saw the fastest growth in filings in 2012, followed by the offices of New Zealand (+14.3%), Mexico (+9%), the United States Patent and Trademark Office ("USPTO," +7.8%), and the Russian Federation (+6.8%). Several offices of middle-income countries, such as Brazil (+5.1%), India (+3.9%) and South Africa (+2.7%), also reported growth in filings.

Filing behavior in Europe showed mixed trends. For example, the European Patent Office ("EPO," +4%), the offices of Germany (+3.2%) and the United Kingdom (UK, +4.4%) witnessed growth. In contrast, the offices of France (-0.7%) and Italy (-4.2%) received fewer applications in 2012 than in 2011.

In 2012, for the first time, residents of China (560,681) accounted for the largest number of patents filed throughout the world. In addition, SIPO (652,777) accounted for the largest number of applications received by any single IP office - a position it first assumed in 2011.

Patent filings by field of technology differ across origins. Residents of Israel and the U.S. filed a high share of their applications in the computer and medical technologies fields. Applications filed by residents of Belgium, India and Switzerland were more concentrated in the organic fine chemistry field. Resident of Brazil filed a high share of applications in basic materials chemistry, while China and the Russian Federation focused their filings on material metallurgy technologies. In contrast, a higher share of applications filed by residents of Japan, Singapore and the Republic of Korea fell within the field of semiconductors. Residents of European countries such as France, Germany and Sweden focused their filings on transport-related technologies.

Patent filings for energy-related technologies grew by 5.3% in 2012. Applications filed by residents of China Hong Kong ("SAR"), Israel and Switzerland were highly concentrated in solar energy, while those of Finland, Japan and the UK had higher shares dedicated to fuel-cell technology.

In 2012, for the first time, the total number of patent grants worldwide exceeded the one million mark, with 694,200 issued to residents and 439,600 to non-residents. The 13.7% growth in 2012 - the highest rate since 2006 - was mainly due to growth in grants issued by the JPO, SIPO and the USPTO.

An estimated 8.66 million patents were in force worldwide in 2012. This figure is based on data provided by 82 IP offices. The USPTO (2.24 million) continues to be the IP office with the largest number of patents in force, followed by the JPO (1.7 million) and SIPO (0.9 million). In 2012, non-resident holders accounted for a large share of patents in force at SIPO (45.9%) and the USPTO (48.4%). In contrast, only 13.6% of all patents in force at the JPO are owned by non-residents.

In 2012, the number of pending applications (i.e., unprocessed applications at any stage of the application process) fell at three of the top four IP offices. The JPO and the USPTO saw year-on-year decreases over the 2008-2012 period, while the Korean Intellectual Property Office ("KIPO") reported an annual decrease only from 2011 to 2012. The EPO has witnessed continuous growth since 2004.

Utility model ("UM") applications worldwide grew by double-digit rates for each year between 2008 and 2012. The 23.4% growth in 2012 was lower than the 34.7% growth observed in 2011, but was similar to the 2010 growth rate (+24.7%). SIPO saw a 26.4% increase in UM applications in 2012. In addition to SIPO, several other IP offices exhibited strong growth in filings - notably, Turkey (+15.5%), the Czech Republic (+13.2%), Italy (+11.7%) and Thailand (+10.7%).


The total number of classes specified in trademark applications (i.e., class counts) filed worldwide grew by 6% in 2012; this was lower than the growth rates recorded in 2010 (9%) and in 2011 (9.5%). In 2012, a total of 6.58 million classes were specified in applications, which comprised 4.84 million resident application class counts and 1.74 million non-resident class counts.

The majority of the top 20 IP offices saw growth in class counts in 2012. Among the top 20 offices, the IP offices of two middle-income countries, namely Turkey (+24.1%) and China (+16.5%), reported the fastest growth. Mexico (+5.5%) and the Russian Federation (+7.9%) also exhibited strong growth in class counts for 2012. In contrast, the IP offices of European Union (EU) countries recorded fewer application class counts in 2012 than in 2011. For example, Italy reported an 8.3% decrease, while Germany and Spain reported decreases of 6.4% and 5.6%, respectively.

In 2012, residents of China filed, worldwide, applications with approximately 1.58 million class counts; this was significantly higher than the figures for the U.S. (599,896), Germany (387,503) and France (384,665). In many countries, the majority of trademarks were filed by residents with their respective domestic IP offices. However, there were some notable exceptions; a high proportion of total filings originating in Austria (49.5%), Switzerland (76.9%) and the U.S. (45%) were filed abroad.

Industrial Designs

Following a slowdown in both 2008 and 2009, the numbers of industrial designs contained in applications (i.e., design counts) rebounded strongly, with double-digit growth recorded in each of the three subsequent years (2010, 2011 and 2012). The 2012 growth of 17% was the highest since design count records became available in 2004. In 2012, applications containing an estimated 1.22 million designs were filed worldwide, comprised of 1.04 million resident filings and 0.17 million non-resident filings.

Among the top 20 IP offices, the IP office of the Russian Federation - with 29.5% growth - recorded the fastest growth in design counts in 2012. SIPO (+26.1%), Turkey (+12.4%), the Office for Harmonization in the Internal Market (OHIM,+12%) and KIPO (+11.8%) experienced double-digit growth from 2011 to 2012. Filings at the IP offices of larger middle-income countries showed mixed trends. Morocco (-14.8%), Brazil (-4%) and Mexico (-0.3%) saw decreases, while India (+4%) and Ukraine (+3.3%) reported growth in design counts over the same period.

Residents of China filed, worldwide, applications containing almost 650,000 industrial designs in 2012. They were followed by residents of Germany (76,369), the Republic of Korea (68,737) and the U.S. (45,245).

Plant Varieties

The total number of plant variety applications reached a new record in 2012 (14,319), but the growth rate of 1.8% in 2012 was modest compared to 2011 (+7.5%). The smaller growth in 2012 was mainly due to a decrease in applications at the European Union's Community Plant Variety Office ("CPVO").

The EU's CPVO received the highest number of applications in 2012 (2,868), followed by the offices of China (1,583) and Ukraine (1,281). Even though applications fell at CPVO by 9.9%, this office received almost twice as many as the office of China.

In 2012, the largest number of plant variety applications originated in the Netherlands (2,560), followed by the U.S. (1,829) and China (1,465). Residents of France, Germany and Japan had similar numbers of applications (approximately 1,000 each). However, twelve of the top 20 origins, including the top two origins, filed fewer applications in 2012 than in 2011.

Practice Tip # 1: Trademark filing data refer to the number of classes specified in trademark applications, while industrial design filings refer to the number of designs contained in applications.

Practice Tip # 2: Like patents, UMs protect inventions for a limited period of time. However, the terms and conditions for granting UMs are different from those for "traditional" patents. In certain countries, UMs are known as "petty patents," "short-term patents" or "innovation patents."

Practice Tip # 3: Class counts are the total number of classes specified in trademark applications. Some IP offices have a single-class filing system, which requires applicants to file a separate application for each class in which the goods or services to which the mark is applied are classified. Other offices follow a multi-class filing system, which enables applicants to file a single application in which goods or services belonging to a number of classes can be specified. In order to make better international comparisons between numbers of applications received, it is important to compare class counts across IP offices.

Practice Tip # 4: Design counts are the total number of designs contained in industrial design applications. Some IP offices allow applications to contain more than one design, while other IP offices allow only one design per application. Design counts data take institutional differences across IP offices into consideration.

Continue reading "Global Patent Filings See Fastest Growth in 18 Years" »

January 16, 2014

Fourth Circuit Affirms Districts Court's Injunction and Admission of Evidence in False Advertising Case

Richmond, Virginia - PBM Products, LLC ("PBM") sued Mead Johnson & Company, LLC ("Mead Johnson") alleging false advertising in violation of the Lanham Act, 15 U.S.C. § 1125(a)(1)(A) and (B), and commercial disparagement. Mead Johnson filed counterclaims againstproducts.jpg PBM. The district court dismissed the counterclaims and entered an injunction against Mead Johnson. Mead Johnson appealed. The United States Court of Appeals for the Fourth Circuit affirmed.

PBM produces store-brand, "generic," infant formula. Mead Johnson produces baby formula products under the brand name Enfamil, including a standard formula, a formula with broken-down proteins, and a formula with added rice starch. Both companies use the same supplier for two key nutrients--docosahexaenoic acid (DHA) and arachidonic acid (ARA)--which are important to an infant's brain and eye development. Mead Johnson calls these nutrients by their brand name "Lipil," while PBM describes them generically as "lipids." Both companies use the same level of the lipids. As a result, PBM includes a comparative advertising label on their formula that states, "Compare to Enfamil."

PBM sued Mead Johnson under the Lanham Act, 15 U.S.C. § 1125(a), alleging that Mead Johnson engaged in false advertising and commercial disparagement when it distributed more than 1.5 million direct-to-consumer mailers that falsely claimed that PBM's baby formula products were inferior to Mead Johnson's baby formula products.

MJBF.bmpMead Johnson filed counterclaims against PBM alleging breach of contract, defamation, false advertising, and civil contempt. Mead Johnson's defamation counterclaim was based primarily on a press release issued by PBM CEO Paul Manning declaring that "Mead Johnson Lies About Baby Formula ... Again." Mead Johnson's false advertising counterclaim alleged that labels on PBM's products conveyed several implied messages comparing PBM and Mead Johnson's formulas. Mead Johnson's breach of contract and civil contempt counterclaims related to prior litigation between the parties.

After a jury found that Mead Johnson had engaged in false advertising, the district court issued an injunction prohibiting Mead Johnson from making similar claims, which enjoined all four advertising claims that Mead Johnson had made, including the express claim that "only Enfamil LIPIL is clinically proven to improve brain and eye development."

On appeal, Mead Johnson presented three clusters of issues for review by the Fourth Circuit: (1) whether the district court erred in its dismissal of Mead Johnson's counterclaims; (2) whether the district court abused its discretion in its admission of expert opinion testimony and evidence of prior litigation between the parties; and (3) whether the district court erred or abused its discretion in issuing the injunction.

The dismissals of Mead Johnson's counterclaims for breach of contract, defamation, false advertising, and civil contempt were all affirmed. The allegedly defamatory statement "Mead Johnson Lies About Baby Formula ... Again" was held to be true, as it was found that Mead Johnson had made false statements prior to the publication of PBM's press release ("Mead Johnson Lies") and had also made previous false statements about PBM's baby formula (the "Again" portion of the PBM's press release). The dismissal of the defamation claim on summary judgment was held to be proper as no false statement had been made.

The Fourth Circuit then upheld the district court's disposal of Mead Johnson's Lanham Act counterclaims as a matter of law. Those claims accruing prior to the two-year statute of limitations were affirmed to be time-barred. Claims accruing after that period were affirmed as correctly estopped under the equitable principle of laches.

The Fourth Circuit also held that the district court did not err in granting judgment as a matter of law on Mead Johnson's Lanham Act counterclaim concerning PBM's rice starch formula advertisements, holding that the district court had properly concluded that, because the consumer surveys that had been conducted by Mead Johnson had failed to address the allegations in the lawsuit, no relevant evidence had been produced by Mead Johnson on this claim. Moreover, it was held that Mead Johnson had failed to show either falsity of the statements or that any damage was caused by any of the "compare to Enfamil" language that had been used by PBM.

The appellate court then addressed Mead Johnson's contention that the district court erred by admitting (1) expert survey evidence and (2) evidence of prior Lanham Act litigation between the parties. These decisions were reviewed for abuse of discretion.

Mead Johnson had argued that the survey evidence offered by PBM should be excluded as the consumers involved in the survey did not exactly match the "universe" of consumers appropriate to this litigation. The district court was not convinced. It noted that "while Mead Johnson has pointed out numerous ways in which it would have conducted [the] survey differently, its arguments do not demonstrate that the methods used were not of the type considered reliable by experts . . . ." The district court concluded that the possibility that the survey had targeted the wrong universe went to the weight to be accorded to the survey, not to its admissibility. The appellate court cited a Seventh Circuit case, AHP Subsidiary Holding Co. v. Stuart Hale Co., which noted that "[w]hile there will be occasions when the proffered survey is so flawed as to be completely unhelpful to the trier of fact and therefore inadmissible, such situations will be rare" and affirmed the district court's conclusion "without difficulty."

Mead Johnson also had also asserted that the district court had erred in admitting evidence of the 2001 and 2002 Lanham Act lawsuits filed by PBM, contending that the evidence was irrelevant and more prejudicial than probative. The Fourth Circuit found that the history of prior litigation was both relevant and that its probative value was not substantially outweighed by any danger of unfair prejudice. Moreover, in upholding the trial court's ruling, the appellate court opined that a district court's decision to admit evidence over an objection based on the potential for unfair prejudice "will not be overturned except under the most extraordinary circumstances, where [the district court's] discretion has been plainly abused."

The Fourth Circuit then turned to Mead Johnson's contention that the injunction issued by the district court had been improper. Mead Johnson argued that the injunction was improper for two reasons. First, it asserted that PBM failed to establish any risk of recurrence of the violation. Second, it argued that the scope of the injunction was too broad, as it prohibited conduct that PBM had not proved at trial and that it was beyond the harm PBM sought to redress.

The appellate court was not persuaded. At trial, the jury had returned a verdict in favor of PBM on its false advertising claim and had awarded PBM $13.5 million in damages. In such a case, where a violation has been established and the party seeking the injunction has made a showing that such an injunction is proper, section 1116(a) of the Lanham Act vests district courts with the "power to grant injunctions, according to the principles of equity and upon such terms as the court may deem reasonable, to ... prevent a violation under [§ 1125(a) of the Lanham Act]." The Fourth Circuit held that a showing sufficient to support the district court's injunction had been made and upheld the lower court's ruling. The appellate court further indicated that the injunction was proper as, "PBM cannot fairly compete with Mead Johnson unless and until Mead Johnson stops infecting the marketplace with misleading advertising."

Finally, Mead Johnson argued that, because the general jury verdict did not specify which of the four statements in the mailer the jury found to be false and/or misleading, the district court's injunction must be limited only to the mailer or other advertisements not colorably different from the mailer. The Fourth Circuit rejected the narrow construction suggested by Mead Johnson. It noted again that, inter alia, Mead Johnson's claim that it was the "only clinically proven" formula had been found to be misleading by the district court. It concluded that because the district court's interpretation of the jury verdict was plausible in light of the record viewed in its entirety, the factual findings upon which it based the scope of its injunction could not as a matter of law be clearly erroneous. Consequently, the scope of the injunction also was affirmed.

Practice Tip #1: These parties are familiar combatants on the Lanham Act battlefield. For example, in 2001, Mead Johnson distributed brochures and tear-off notepads to patients in pediatricians' offices stating that store-brand formula did not have sufficient calcium or folic acid. PBM sued and obtained a restraining order prohibiting Mead Johnson from making similar statements. The parties settled that dispute. Then, in 2002, Mead Johnson distributed a chart to physicians stating that store-brand formula did not contain beneficial nucleotides. PBM sued and, again, the parties settled.

Practice Tip #2: The Lanham Act prohibits the "false or misleading description of fact, or false or misleading representation of fact, which ... in commercial advertising or promotion, misrepresents the nature, characteristics, qualities, or geographic origin of his or her or another person's goods, services, or commercial activities." 15 U.S.C.A. § 1125(a)(1)(B).

Practice Tip #3: In the Seventh Circuit, as with other federal circuits, "[A] court may find on its own that a statement is literally false, but, absent a literal falsehood, may find that a statement is impliedly misleading only if presented with evidence of actual consumer deception." Abbott Labs. v. Mead Johnson & Co., 971 F.2d 6, 14 (7th Cir. 1992).

Practice Tip #4: Before an injunction may issue, the party seeking the injunction must demonstrate that (1) it has suffered an irreparable injury; (2) remedies available at law are inadequate; (3) the balance of the hardships favors the party seeking the injunction; and (4) the public interest would not be disserved by the injunction. eBay, Inc. v. MercExchange, 547 U.S. 388, 391 (2006).

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January 15, 2014

Indiana Tax Court Shields Orbitz from Disclosure of Trade Secrets

Indianapolis, Indiana - In the matter of Orbitz, LLC v. Indiana Department of State Revenue, Orbitz, LLC of Chicago, Illinois was heard by the Indiana Tax Court on its request to prohibit public access to information in the court record. The court granted the request, holding thewentworth-new.jpg trade secrets contained in documents submitted to the court were protected against public disclosure by both the Access to Public Records Act (Indiana Code § 5-14-3-1 et seq.) and Indiana Administrative Rule 9

Orbitz, an online travel company, provides travel-related services on its website that enable its customers to search for and make reservations for a broad array of travel products, including airline tickets, lodging, rental cars, cruises and vacation packages.

The broad issue in this Indiana-state tax appeal was the appropriate base on which to calculate the Indiana state and local taxes due. Generally speaking, a hotel will contract with Orbitz to make its rooms available for reservation through Orbitz's website. Pursuant to the contract, the hotel agrees to accept a certain amount for its rooms ("net rate"). Nevertheless, a customer who books a room through the website sees - and ultimately pays - a different amount, as Orbitz has added a facilitation fee, a service charge, and a tax recovery charge to the net rate. The tax recovery charge is equal to the amount of state and local taxes due on the room's rental at the net rate.

After the customer has occupied the room, Orbitz forwards to the hotel the portion of the payment it collected from the customer that constitutes the room's net rate and tax recovery charge. The hotel is then responsible for remitting to the taxing authorities the appropriate state and local taxes due on the room's rental.

Following an audit in which the Indiana Department of Revenue found Orbitz to have underpaid the taxes due, Orbitz brought this appeal. Orbitz argued to the court that tax was due only on the net amount paid by Orbitz to the hotel. The Indiana Department of Revenue, in contrast, maintained that Orbitz had been deficient in remitting Indiana's gross retail (sales) and county innkeeper taxes on the hotel bookings at issue. It contended that the total amount paid by the customer to Orbitz for the room was the correct figure on which to base the Indiana-state tax.

When asking the Indiana Tax Court for summary judgment, Orbitz also asked that the court prohibit public access to its contracts with the Indiana hotels, stating that the contracts were "proprietary [and] competitively sensitive" and that they contained trade secrets belonging to Orbitz.

The general rule in Indiana is that the public has access to court records. Citing the Access to Public Records Act, Ind. Code § 5-14-3-1, the court stated "all persons are entitled to full and complete information regarding the affairs of [their] government." However, in certain circumstances, that right of access is restricted. An example of such a circumstance is when materials submitted to the court qualify as a trade secret. Trade secrets are protected from disclosure by statute in Indiana.

Indiana Code Section 24-2-3-2 defines a trade secret as:

information, including a formula, pattern, compilation, program, device, method,             technique, or process, that:

1. derives independent economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use; and

2. is the subject of efforts that are reasonable under the circumstances to maintain its secrecy.

The court then enumerated the four general characteristics of a trade secret:

1. it is information;

2. that derives independent economic value;

3. that is not generally known, or readily ascertainable by proper means by others who can obtain economic value from its disclosure or use; and

4. that is the subject of efforts, reasonable under the circumstances, to maintain its secrecy.

The court granted Orbitz's motion to shield Orbitz's contracts with Indiana hotels, holding the information in those contracts to be properly protected as trade secrets. It stated, "Competition is the bedrock of our country's economic system. The protection afforded to trade secrets under [the Access to Public Records Act] and Administrative Rule 9 helps to foster a healthy, competitive marketplace . . . . Here, Orbitz's contracts contain trade secrets and therefore are protected from public disclosure under both APRA and Administrative Rule 9."

Practice Tip:

When, as here, the documents sought to be protected fall within a mandatory exception set forth in the Access to Public Records Act or Indiana Administrative Rule 9, a court can seal those records without holding a hearing and balancing the competing interests. However, in other cases, when issuing an order to shield information from public access, the court must specifically outline why the need for privacy outweighs the strong public policy to allow such access.

In such a case, Indiana Code § 5-14-3-5.5(d) requires that the court's order be based on findings of fact and conclusions of law and show "that the remedial benefits to be gained by effectuating the [state's] public policy of [public access] are outweighed by proof by a preponderance of the evidence by the person seeking the sealing of the record that: (1) a public interest will be secured by sealing the record; (2) dissemination of the information contained in the record will create a serious and imminent danger to that public interest; (3) any prejudicial effect created by dissemination of the information cannot be avoided by any reasonable method other than sealing the record; (4) there is a substantial probability that sealing the record will be effective in protecting the public interest against the perceived danger; and (5) it is reasonably necessary for the record to remain sealed for a period of time."

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January 13, 2014

Contour Hardening Sues Vanair for Patent and Trademark Infringement

Indianapolis, Indiana - Indiana patent and trademark attorneys for Contour Hardening, Inc. of Indianapolis, Indiana sued seeking injunctive and monetary relief in the Southern District of Indiana. Contour Hardening alleges that Vanair Manufacturing, Inc. of Michigan City, Indiana has infringed the trademark "REAL POWER", Trademark Registration No. 3,124,014, as well as Contour Hardening's patented "Vehicle Mounted Electrical Generator System." The invention is covered by Patent Nos. 6,979,913 and 7,057,303, which have been issued by the U.S. Patent Office.

US06979913-20051227-D00005.PNGIn this lawsuit, Plaintiff Contour Hardening contends that Defendant Vanair has violated, and continues to violate, inter alia, the patent laws of the United States, 35 U.S.C. §§271 and 281- 285, as well as the Federal Trademark Act by infringing Contour Hardening's two patents, U.S. Patent Nos. 6,979,913 and 7,057,303 (collectively, the "Contour Patents"), and infringing Contour Hardening's REAL POWER trademark by using Vanair's allegedly similar ROAD POWER trademark.

Contour Hardening is a developer and provider of Power Take-Off ("PTO") driven generator systems for vehicles ranging from Class 2 pickup trucks (e.g., full-size trucks) to larger Class 8 Heavy Duty trucks (e.g., tractor trailer trucks). It states that these systems have been utilized in municipal, fire-rescue, construction, healthcare, mining, farming and other applications.

Plaintiff asserts that, sometime around 2007, Vanair first began offering vehicle-mounted AC-generator systems that infringe one or more of the claims of the Contour Patents. Vanair is accused of having received actual knowledge that it was infringing the Contour Patents at least as early December 17, 2012, when an Indiana patent and trademark lawyer for Contour Hardening sent to Vanair a letter providing it with actual notice of the Contour Patents and expressing "concerns regarding possible infringement." The letter requested that Vanair "evaluate [its] activities relative to these two (2) patents and provide a written response as to when any infringing activities will cease." According to Contour Hardening, Vanair did not respond this letter.

In addition to its allegations of patent infringement, Contour Hardening asserts trademark infringement. Contour Hardening indicates that it is the owner of United States Registration No. 3,124,014 for the trademark REAL POWER for providing AC generators. It claims that, since at least 2004 and continuously to date, it has adopted and used in interstate commerce the trademark REAL POWER in connection with its PTO-driven AC-generator systems and related operations and that the trademark has become distinctive to consumers in the vehicle-mounted AC-generator industry.

Contour Hardening contends that Vanair offers the allegedly infringing products under the trademark ROAD POWER with knowledge of Contour Hardening's REAL POWER trademark. It further asserts that the nameplates, labels or other graphic displays that Vanair uses are confusingly similar to Contour Hardening's trademark and that Vanair's use of the ROAD POWER trademark is likely to cause confusion or mistake or deception of consumers as to the source of origin of Vanair's goods or services. Contour Hardening further claims that Vanair's activities have been willful, deliberate and intentional, have caused a likelihood of confusion, and have been done with the intent to trade upon Contour Hardening's goodwill in the trademark REAL POWER.

In the complaint, Indiana patent and trademark attorneys assert the following on Contour Hardening's behalf:

• Count I - Infringement of U.S. Patent 6,979,913
• Count II - Infringement of U.S. Patent 7,057,303
• Count III - Trademark Infringement
• Count IV - False Designation of Origin

Contour Hardening asks the court for a judgment of infringement of the Contour Patents; a judgment of infringement of Contour Hardening's REAL POWER trademark; a permanent injunction prohibiting further infringement; an order that all infringing devices be delivered and destroyed; damages, including treble damages; costs and expenses; an order declaring that the case is exceptional and an award of attorney's fees pursuant to such a finding.

Practice Tip: A 2006 opinion from the Federal Circuit, AERO Products International, Inc., et al. v. INTEX Recreation Corp., et al., addressed double recovery in cases where both patent infringement and trademark infringement are found. The Federal Circuit held that the trial court's award of both $2.95 million for patent infringement - which was doubled to $5.9 million pursuant to a finding of willful patent infringement - and $1 million for trademark infringement was impermissible as a double recovery for the "same injury." The court vacated the $1 million award for trademark damages stating, "even though damages are claimed based upon separate statutes or causes of action, when the claims arise out of the same set of operative facts, as is the case here, there may be only one recovery."

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January 10, 2014

USPTO to Host Forum to Discuss Proposed Changes to Implement Patent Law Treaties Implementation Act of 2012 - Title I The Hague Agreement

Washington, D.C. - The U.S. Department of Commerce's United States Patent and 140px-US-PatentTrademarkOffice-Seal.svg.pngTrademark Office ("USPTO") recently announced that it will hold a public forum to discuss implementation of Title I of the Patent Law Treaties Implementation Act of 2012 ("PLTIA"). The law, which serves as the implementing legislation for the Geneva Act of the Hague Agreement Concerning the International Registration of Industrial Designs ("the Hague Agreement"), allows applicants to file a single international design application to acquire global protection. The forum will be held on Tuesday, January 14, 2014, at the USPTO campus in Alexandria, Virginia.

On November 29, 2013, the USPTO published a notice in the Federal Register seeking written comments on proposed changes to the rules of practice to implement Title I of the PLTIA.

The PLTIA and the proposed rules call for the following: standardizing formal requirements for international design applications; establishing the USPTO as an office through which international design applications may be filed; providing for substantive examination by the Office of international design applications that designate the United States; providing provisional rights for published international design applications that designate the United States; and setting the patent term for design patents at 15 years from the date of patent grant.

Further information about the proposed rules and upcoming forum may be found in the Federal Register Notice.

Practice Tip: This new law allows applicants to file a single international design application to pursue global protection.

January 9, 2014

Supreme Court's Holding in Gunn Requires Remand of Suit Alleging Malpractice in Patent Law

Indianapolis, Indiana - Citing the recent U.S. Supreme Court decision in Gunn v. Minton, the court-bench-picture.jpgSouthern District of Indiana has remanded to the Marion Superior Court the legal malpractice lawsuit filed by the Indiana patent lawyer for Miller Veneers, Inc. The Defendants in the case are Indiana patent attorney Clifford W. Browning as well as two Indiana law firms, Krieg DeVault, LLP and Woodard, Emhardt, Moriarty, McNett & Henry, LLP.

In September 2012, Miller Veneers sued Clifford W. Browning; Krieg DeVault; and Woodard, Emhardt, Moriarty, McNett & Henry in Marion Superior Court alleging attorney malpractice regarding the acquisition of patents. Defendants removed the case to the Southern District of Indiana in October 2012, asserting federal question jurisdiction and 28 U.S.C. § 1338(a) (2008).

Although the court originally found that it had subject matter jurisdiction under 28 U.S.C. § 1338(a), the Supreme Court's recent decision in Gunn v. Minton led the court to reconsider the question of federal jurisdiction and to conclude that it did not, in fact, have subject matter jurisdiction over the suit, despite that the legal malpractice claims were based on underlying patent matters.

According to the new standard set forth in Gunn, federal jurisdiction exists over state law claims "if a federal issue is (1) necessarily raised, (2) actually disputed, (3) substantial, and (4) capable of resolution in federal court without disrupting the federal-state balance approved by Congress."

While the issues of federal law in this malpractice lawsuit were found to meet the first two prongs, the court held that they failed the second two prongs. Specifically, the third Gunn prong requires that the issue be "substantial," which requires the court "to look to the importance of the issue to the federal system as a whole." The court held that, as was the case in Gunn, this issue was not important to the federal system as a whole but merely to the parties. The court also held that the fourth prong had not met. It stated that, where issues such as malpractice are to be litigated, the balance is in favor of the states as they have "a special responsibility for maintaining standards among members of the licensed professions."

The court, upon determining that it lacked jurisdiction under the standard set forth in Gunn, remanded the matter to the Marion Superior Court.

Practice Tip: In Gunn, the Supreme Court held that a legal malpractice claim pertaining to the handling of a patent infringement case did not afford jurisdiction under 28 U.S.C. § 1338(a), stating, "We are comfortable concluding that state legal malpractice claims based on underlying patent matters will rarely, if ever, arise under federal patent law for purposes of § 1338(a)."

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January 8, 2014

Court Strikes Four Affirmative Defenses of BitTorrent Defendant

Fort Wayne, Indiana - District Magistrate Judge Roger B. Cosbey struck four affirmative defenses asserted by anonymous Defendant John Doe in Plaintiff Malibu Media's lawsuit in the Northern District of Indiana for copyright infringement.

Plaintiff Malibu Media, LLC, filed a copyright infringement action against Defendant John Doe. Defendant answered with ten affirmative defenses. Malibu Media sought to strike four of those defenses--laches, unclean hands, waiver, and estoppel; failure to mitigate damages; failure to join an indispensable party; and implied license, consent, and acquiescence.

Plaintiff first moved to strike Defendant's second affirmative defense--that "Plaintiff's claims are barred by the equitable doctrines of laches, unclean hands, waiver and estoppel"--as a bare conclusory allegation unsupported by any factual basis. The court ordered that defense stricken, stating "[m]erely stringing together a long list of legal defenses...does not do the job of apprising opposing counsel and this Court of the predicate for the claimed defense--which is after all the goal of notice pleading."

Plaintiff next moved to strike Defendant's fifth affirmative defense--that Plaintiff did not mitigate its damages. Malibu Media argued that this defense was improper because it had elected to pursue only statutory, rather than actual, damages. The court agreed that a copyright plaintiff's exclusive pursuit of statutory damages invalidates a failure-to-mitigate defense and struck this affirmative defense.

The court also struck Defendant's seventh affirmative defense, in which Defendant argued that Plaintiff had failed to join an indispensable party. Defendant asserted that he had not engaged in any infringing activity and Plaintiff has not joined those who had. The court held that Defendant's assertion that he had not engaged in any improper activity was not an affirmative defense but rather a mere denial of liability. It further held that Defendant was incorrect in asserting that joinder was necessary, holding that the court would be able to adjudicate the matter and "accord complete relief to Plaintiff regardless of whether any other allegedly infringing members were joined in the action.

Finally, Plaintiff asked that Defendant's eighth affirmative defense as be struck as conclusory. Defendant had asserted that "Plaintiff's claims are barred by Plaintiff's implied license, consent, and acquiescence to Defendant because Plaintiff authorized use via Bit Torrent [sic]." The court held that Defendant's Answer foreclosed the possibility of an implied license defense, as Defendant had denied downloading the copyrighted work. As such, Defendant could not also argue that he had downloaded the copyrighted work with a license.

Practice Tip #1: Generally speaking, motions to strike portions of pleadings are disfavored as they consume scarce judicial resources and may be used for dilatory purposes. Such motions will generally be denied unless the portion of the pleading at issue is prejudicial. When faced with a motion to strike affirmative defenses under Rule 12(f), Indiana federal courts apply a three-part test: (1) whether the matter is properly pled as an affirmative defense; (2) whether the affirmative defense complies with Federal Rules of Civil Procedure 8 and 9; and (3) whether the affirmative defense can withstand a Rule 12(b)(6) challenge. An affirmative defense that fails to meet any of these standards must be stricken.

Practice Tip #2: Defendant did not file a response to Malibu Media's motion to strike Defendant's affirmative defenses. For that reason alone, the court could have ruled on the motion summarily under the Northern District's Local Rule 7-1(d)(4).

Practice Tip #3: Even under the liberal notice pleading standards of the Federal Rules, an affirmative defense must include either direct or inferential allegations as to all elements of the defense asserted. Bare bones conclusory allegations are insufficient. Moreover, laches, waiver, estoppel, and unclean hands are equitable defenses that must be pled with the specific elements required to establish the defense.

Practice Tip #4: An implied license, which Defendant argued as an affirmative defense, arises when (1) a person (the licensee) requests the creation of a work, (2) the creator (the licensor) makes that particular work and delivers it to the licensee who requested it, and (3) the licensor intends that the licensee-requestor copy and distribute his work.

Practice Tip #5: This opinion demonstrates one of the pitfalls of pleading in the alternative. Defendant appears to have tried to argue that he didn't download the copyrighted material but that, if he had, it was with an implied license from Plaintiff. The court was not persuaded, however, as Defendant's Answer had denied downloading the copyrighted material with BitTorrent. As a result, Defendant was not permitted to argue also that he downloaded the copyrighted material using BitTorrent but that he had an implied license to do so.

A well-known example of such alternative pleading was demonstrated by Richard Haynes: "Say you sue me because you say my dog bit you. Well, now this is my defense: My dog doesn't bite. And second, in the alternative, my dog was tied up that night. And third, I don't believe you really got bit. And fourth, I don't have a dog."

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January 6, 2014

Joe Hand Promotions Sues for Unlawful Interception of Championship Fight

South Bend, Indiana - Joe Hand Promotions, Inc. of Feasterville, Pennsylvania, via a Kentucky intellectual property lawyer, has sued in the Northern District of Indiana alleging that Lee H. Holmes, individually and d/b/a Homer's Restaurant, both of Peru, Indiana, unlawfully Lesnar-Overeem-Picture.jpgintercepted and televised the Ultimate Fighting Championship 141:Brock Lesnar v. Alistar Overeem ("the Program").

Joe Hand Promotions, a commercial distributor of sporting events, states that it was granted exclusive rights to distribute via closed-circuit telecast the Ultimate Fighting Championship ("UFC") fight between Brock Lesnar and Alistar Overeem, which Joe Hand Promotions asserts was broadcast nationwide on December 30, 2011.

In the complaint against Holmes and Homer's Restaurant, Joe Hand Promotions has alleged such wrongful acts as interception, reception, publication, divulgence, display, exhibition, and "tortuously" [sic] converting the Program.

In addition to naming the restaurant, which was not listed as a separate legal entity, Joe Hand Promotions has also sued Holmes as an individual, claiming that he had the right and ability to supervise the activities of Homer's Restaurant. Joe Hand Promotions asserts that those activities included the unlawful interception of its UFC Program.

Holmes and Homer's Restaurant have been accused of violating 47 U.S.C. § 605 and 47 U.S.C. § 553. The complaint, filed by a Kentucky intellectual property attorney, also lists a count of conversion. Joe Hand Promotions seeks statutory damages of $110,000 for each willful violation of 47 U.S.C. § 605; $60,000 for each willful violation of 47 U.S.C. § 553; compensatory and punitive damages on the claim of conversion; costs, including costs incurred for the service of process and the investigation of potential wrongdoing; and attorney's fees.

Practice Tip #1: While on the surface this appears to be a copyright case, an allegation of interception under 47 U.S.C. § 605 is a different cause of action from copyright infringement. However, a suit alleging interception does not preclude an additional lawsuit asserting different causes of action. For example, the copyright holder can also sue for copyright infringement, which could increase damages by as much as $150,000.

Practice Tip #2: Most satellite signal providers employ encryption to limit receiption to certain groups, such as paying subscribers.  However, not all licenses grant equal rights.  for example, if an individual as a "residential" agreement with a satellite provider, that agreement does not also give that individual the right to display the performance in a public setting like a bar or restaurant..

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January 3, 2014

160 Trademark Registrations Issued to Indiana Companies in December 2013

The U.S. Trademark Office issued the following 160 trademark registrations to persons and businesses in Indiana in December 2013 based on applications filed by Indiana trademark attorneys:

Reg. Number Word Mark Click to View
4455043 GESSO VIEW
4454629 KSIR VIEW
4454173 CO VIEW

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January 2, 2014

Patent Office Issues 184 Patents To Indiana Citizens in December 2013

The U.S. Patent Office issued the following184 patent registrations to persons and businesses in Indiana in December 2013, based on applications filed by Indiana patent attorneys: 

Patent No.  Title
D696,781 Orthopaedic tool handle 
8,621,641 Systems and methods for authorization of information access 
8,620,625 Above bed sensor 
8,620,477 Control for pressurized bladder in a patient support apparatus 
8,618,954 Mobile FLOW readout and mobile FLOW sequencer features 
8,618,918 Patient support, communication, and computing apparatus including movement of the support and connection to the hospital network 
8,618,511 Marking method for the reject marking of test elements 
8,618,475 Ion mobility spectrometer with one or more integral ion activation regions 
8,618,444 Rotary door heater system 
8,618,293 Redox mediators 

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