Indianapolis, Indiana – The Plaintiff, Thrivent Financial for Lutherans (“Thrivent”), is a fraternal benefits society established in 1902 with over 2 million members and over $100 billion in assets under management or advisement. Thrivent and its licensees offer a wide variety of services and products to their members and customers under the THRIVENT Trademarks (listed below), including insurance and annuity products, financial and business advising, mutual funds and investments, individual retirement accounts, trust accounts, financial advisory services, banking and credit union services, lending services, and debit and credit card services.
New Albany, Indiana – Chief Judge Tanya Walton Pratt for the Southern District of Indiana dismissed a patent infringement suit filed by Plaintiff, Eddie M. Green, Jr. (“Green”) in March 2020 for lack of personal jurisdiction.
Green, who claimed Defendants, Ara Yavruyan and Chain Vault Inc., infringed on his U.S. Patent No. 9,940,796 for the “Yellow Fellow Safety Sign” filed his pro se Complaint in the Southern District of Indiana although he noted a California address for the Defendants. In response, Defendants filed a Motion to Dismiss arguing improper venue, lack of personal jurisdiction, failure to effect service, and that the Complaint fails to state a claim upon which relief can be granted.
In or around April 2020, the Court directed the Clerk to issue process, which was returned unexecuted by the United States Marshals Service (“USMS”) on July 9, 2020 as it could not locate the Defendants at the address listed on the Complaint. A second address was found and the Court ordered the USMS to issue process at the second address. On October 20, 2020, the USMS again returned an unexecuted summons, Complaint, and Order because it could not locate the second address for the Defendants. After being required to submit search evidence and a proper address to the Court, Green filed a Motion for Alias Summons which was granted on November 18, 2020. On November 19, 2020, having been served, the Defendants filed their Motion to Dismiss.
Over the course of one month after the filing of Defendants’ Motion to Dismiss, Green submitted a Motion for Summary Judgment, a Motion to Strike Declaration, and five filings opposing the Motion to Dismiss.
When a Court is faced with a Fed. Rule Civ. P. 12(b)(2) motion to dismiss for lack of personal jurisdiction, a plaintiff only needs to make a prima facie case of personal jurisdiction. However, “[i]f the defendant has submitted evidence in opposition to the implementation of jurisdiction, ‘the plaintiff must go beyond the pleadings and submit affirmative evidence supporting the exercise of jurisdiction.’” Additionally, the Court must employ a three-prong test to determine if there is specific jurisdiction: (1) the defendant purposefully directed its activities at residents of the forum, (2) the claim arises out of or relates to those activities, and (3) assertion of personal jurisdiction is reasonable and fair.”
Here, the Defendants claim neither reside or have any physical presence in Indiana or “continuous or systematic contacts with Indiana. Thus, the Court must use the three-prong test for specific jurisdiction. However, the Defendants claim they have no contacts with the state of Indiana at all and have therefore not availed themselves to specific jurisdiction. It does not appear Green was able to provide any evidence to the contrary and therefore, the Motion to Dismiss was granted.
This suit is over the design of two bottle caps.
Plaintiff, Closure, claims it designed the bottle cap on the left, and Defendant, Novembal, got a patent on the bottle cap on the right. But Closure claims that it, not Novembal is the actual “inventor” of the bottle cap design. Perhaps fearing that Novembal was about to file suit, Closure in its home turf of New Jersey and trying to gain a home court advantage, took the initiative and sued Novembal in Indiana. Its Complaint sought to “correct the inventorship” of Novembal’s patent and to prevent Novembal from enforcing the patent against Closure. That suit is reported here: Closure Systems International Sues Novembal USA Seeking Correction of Inventorship. Not surpisingly, Novembal asserted a counterclaim for patent infringement.
The twist is that in the infringement counterclaim, Novembal seeks a broad injunction. So broad, that it would prevent not just Closure, but some of Closure’s customers from infringing the patent. In its counterclaim, Novembal seeks:
A permanent injunction enjoining CSI and its employees, agents, successors, partners, officers, directors, owners, shareholders, principals, subsidiaries, related companies, affiliates, distributors, dealers, and all persons in active concert or participation with any of them . . . from making, importing, promoting, offering, or exposing for sale, or selling the CSI Production Closures, or any other closures with designs confusingly similar to the claimed design of Novembal’s ‘442 patent.
One company that apparently gets its bottle caps from Closure is Nestle, one of the biggest sellers of bottled water. So far, no big deal. Except, Nestle is represented by the blue chip Washington DC patent law firm, Finnegan, Henderson, Farabow, Garrett & Dunner. Finnegan happens to be the same law firm that represents Novembal in the suit with Closure. So Finnegan is attempting to get an injunction for one client (Novembal) that would apply to another client, Nestle. Continue reading
Indianapolis, Indiana – Attorney and Photographer Richard N. Bell of McCordsville, Indiana filed suit in the Southern District of Indiana alleging that Defendant, Halcyon Business Publications, Inc., of New York infringed his “Indianapolis Photo” which has been registered with the United States Copyright Office as Registration No. VA0001785115. After review of the Defendant’s Motion to Dismiss for Lack of Jurisdiction which was filed on December 29, 2017 the court granted the Motion to Dismiss on May 24, 2018.
Bell, who has brought many similar lawsuits for infringement of his Indianapolis Photo, initially filed this case on November 29, 2017 alleging violations of the Lanham Act and copyright infringement. Halcyon claimed that the Court lacked personal jurisdiction over the company as they do not maintain any offices in the state, have no employees in the state, and have no assets in the state of Indiana. They did admit that they hired one Indiana resident as an independent contractor to write for their publication, but that contractor did not write the article that utilized the Indianapolis Photo. Further, the total amounts of advertising sold to Indiana companies by Halcyon amounted to 3.26% and 4.55% in 2016 and 2017, respectively, and Indiana subscribers to the publication comprised less than 3% of their total subscribers.
Here, the Court must only look at whether the personal jurisdiction is consistent with the Federal Due Process Clause as Indiana’s long-arm statute is analyzed under this issue. For this, a defendant must have “minimum contacts” with the forum state and purposefully avail themselves “of the privilege of conducting activities within the forum [s]tate, thus invoking the benefits and protections of its laws.” Asahi Metal Indus. Co. v. Super. Ct. of Cal., 480 U.S. 102, 109 (1987). This allows a defendant to reasonably anticipate being brought into a forum in a foreign jurisdiction.
Fort Wayne, Indiana – Attorneys for Plaintiff, Vera Bradley Designs, Inc., of Roanoke, Indiana filed suit in the Northern District of Indiana alleging that Defendant, Austin Devin 2 Denny Boys, LLC, infringed multiple trademarks of the Plaintiff. Overhauser Law Offices, LLC represented the Defendant Austin Devin 2 Denny Boys LLC and Darlene Nicholas, who filed a Motion to Dismiss for improper venue and prevailed on July 30, 2018.
Plaintiff currently holds more than 900 copyright registrations, 35 federal trademark registrations, and has 17 pending federal trademark applications. The Plaintiff alleged in its complaint that the Defendants operate eBay accounts that they use to sell counterfeit Vera Bradley items and these acts infringe Vera Bradley’s trademarks and copyrights. All Defendants were sent cease and desist letters on behalf of the Plaintiff via counsel on July 26, 2017. On August 1, 2017, all Defendants party to the Motion to Dismiss responded through counsel and agreed to stop selling the counterfeit items, however, the Plaintiff alleged they did not cease their activities and filed suit.
The Defendants moved to dismiss Vera Bradley’s Complaint and claimed that because a substantial part of the events leading to the Plaintiff’s claims did not occur in the Northern District of Indiana, venue was improper. Further, Defendant Nicholas, claimed that the Court did not have personal jurisdiction over her. The Plaintiff countered that there were five specific instances in which the counterfeit merchandise was purchased by its employees within the Northern District of Indiana from the Defendants. They also claimed that venue was proper because they suffered harm in the District. As to Defendant Nicholas, the Court held that the Plaintiff did not give any persuasive argument as to how the Northern or Southern District Courts of Indiana could have general or specific personal jurisdiction over her in this case as she resides in Florida. Therefore, the Court was unable to transfer the case to the Southern District of Indiana, which may have been a proper venue for the other Defendants involved.
Fort Wayne, Indiana – The Northern District of Indiana granted a motion for interlocutory appeal to the Seventh Circuit.
This Indiana copyright lawsuit involves Plaintiff Design Basics, LLC of Omaha, Nebraska, a company which “creates, markets, publishes and licenses the use of architectural works and technical drawings.” Defendant is Lancia Homes, Inc., a Fort Wayne company that builds homes.
During the course of litigation, Plaintiff stated that in 2013 it discovered that Defendant had infringed various copyrighted architectural works. A search of a website archive further revealed that “Defendant had actually been advertising infringing versions of the Plaintiff’s homes since May 18, 2006.”
In February 2016, Design Basics sued Lancia Homes alleging infringement of copyrighted architectural designs. It also named several entities under which Lancia also does business, including Lancia Construction, Springmill Development, Lancia Real Estate, Lancia Homes, Springmill Wood Development, and Waterford Enterprises,
Copyright litigators for Design Basics argued that its claims were not time barred under the Copyright Act, which states that “[n]o civil action shall be maintained under [its] provisions . . . unless it is commenced within three years after the claim accrued.” It argued that the traditional discovery rule, which provides that a claim accrues when the injured party discovers or should have discovered the allegedly infringing act, should be applied. Citing dicta in the Supreme Court’s decision in Petrella v. Metro-Goldwyn-Mayer, Inc., Defendant Lancia Homes argued that a claim for copyright infringement accrues at the time of the infringing act.
The district court agreed with Design Basics and applied the traditional discovery rule. Lancia Homes requested that the court certify the question for interlocutory appeal.
Under 28 U.S.C. § 1292(b), a trial court may certify an order for appeal if it “involves a controlling question of law, as to which there is a substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate determination of the litigation.” The court found that these conditions had been met and granted Plaintiff’s motion to certify the issue for interlocutory appeal.
Practice Tip: Design Basics argued against an interlocutory appeal. In granting Lancia Homes’ request for interlocutory appeal, the court noted that Design Basics has 24 similar lawsuits pending in the Northern District of Indiana, stating that it “would be more efficient for the Court of Appeals to consider and decide what, if any, impact Petrella has on the statute of limitations for infringement claims within this Circuit before many of the Plaintiff’s cases within this District are to proceed to trial.”
In this Indiana trademark lawsuit, Forest River, Inc. of Elkhart, Indiana sued Winnebago Industries, Inc. of Forest City, Iowa and its subsidiary Winnebago of Indiana, LLC alleging trademark infringement, trade dress infringement, unfair competition, false designation of origin, and false and misleading representations.
Overhauser Law Offices, LLC filed a partial motion to dismiss with the court, arguing that Forest River had neither sufficiently identified the features that constituted the claimed trade dress nor provided any factual support for its assertion that such features were non-functional.
The court noted that “to survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678. The claim is deemed plausible if “the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id.
In this litigation, such a showing required that Forest River define its trade dress. It must also plead sufficient facts to show that the claimed trade dress is nonfunctional, has acquired secondary meaning and that a likelihood of confusion exists between its trade dress and Winnebago’s trade dress.
The court agreed with Winnebago, concluding that Plaintiff had relied on “conclusory and meaningless” assertions in its pleadings. Consequently, it granted Winnebago’s motion and dismissed without prejudice Forest River’s claims concerning trade dress infringement under the Lanham Act, 15 U.S.C. §1125(a) as well as similar claims made under common law.
Overhauser Law Offices represented Winnebago in obtaining this successful order dismissing the trade dress claims.
Indianapolis, Indiana – The matter of Eli Lilly and Company, et al. v. Apotex Inc., et al. has been stayed pending a ruling by the U.S. Court of Appeals for the Federal Circuit.
This Indiana lawsuit was initiated by Lilly, an Indianapolis pharmaceutical company, in conjunction with other Plaintiffs. Patent attorneys for Plaintiffs filed a lawsuit asserting patent infringement after Defendants filed an Abbreviated New Drug Application seeking approval to market a generic version of the drug Axiron® before various patents related to the drug expired. Among Plaintiffs’ contentions were claims of patent infringement of seven patents pertaining to Axiron.
In this motion, patent lawyers for Plaintiffs have asked the court to stay its proceedings pending a ruling in a similar case, Eli Lilly and Company, et al. v. Perrigo Company, et al. The Perrigo case was filed in the Southern District of Indiana in 2013. After a trial, the court issued findings including that one claim in one of the Axiron patents was invalid, while two claims pertaining to another Axiron patent were valid. That ruling was appealed to the Federal Circuit; that appeal remains pending.
Fort Wayne, Indiana – The Northern District of Indiana has denied Defendant’s motion to dismiss for improper venue, citing the connection of the Northern District to the events underlying the litigation.
This Indiana trademark litigation, Family Express Corp. v. Square Donuts, Inc., was filed to resolve a dispute over the use of the words “Square Donuts” in connection with the sale of donuts by two different Indiana-based companies.
Defendant Square Donuts of Terre Haute, Indiana claims trademark rights to “Square Donuts” under federal and Indiana law. It currently sells its “Square Donuts” in bakeries located in southern and central Indiana, including locations in Terre Haute, Indianapolis, Bloomington, and Richmond.
Plaintiff Family Express of Valparaiso, Indiana operates convenience stores in northern Indiana and uses the term “Square Donuts” in conjunction with doughnut sales. Plaintiff states that both it and Defendant are expanding their respective businesses into new markets, with Defendant expanding to the north while Plaintiff expands to the south. Thus, territory in which both operate concurrently has become a possibility.
In 2006, Defendant sent a cease-and-desist letter to Plaintiff. Plaintiff and Defendant subsequently discussed the possibility of entering into a co-existence arrangement, but did reach an agreement.
This trademark lawsuit followed. Plaintiff asks the Indiana federal court to declare that its use of the term does not infringe on the trademark rights in “Square Donuts” asserted by Defendant. Plaintiff also asks the court to cancel Defendant’s existing Indiana and federal “Square Donuts” trademarks.
Trademark litigators for Defendant asked the court to dismiss the lawsuit, claiming that it had been filed in an improper venue. In evaluating whether venue in the Northern District was permissible, the court first noted that, while it “must resolve all factual disputes and draw all reasonable inferences in the plaintiff’s favor,” Plaintiff then bears the burden of establishing that venue is proper. It also noted that venue can be proper in more than one district.
The federal venue statute, 28 U.S.C. § 1391(b), provides that venue can exist in “(1) a judicial district in which any defendant resides, if all defendants reside [in the same state]” or “(2) a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of the property that is the subject of the action is situated.”
Plaintiff relied on subsection (b)(2), claiming that a substantial part of the events giving rise to the lawsuit took place in the Northern District of Indiana. To establish venue, Plaintiff pointed to the fact that Defendant’s cease-and-desist letter and other communications had been relayed to Plaintiff in the Northern District. At least some rulings by districts courts located within the Seventh Circuit have held that the requirements for venue “may be satisfied by a communication transmitted to or from the district in which the cause of action was filed, given a sufficient relationship between the communication and the cause of action.”
The Northern District of Indiana concluded that such communications, which would be a typical element of litigation under the Declaratory Judgment Act, would defeat the purpose of protecting a defendant from having to litigate “in the plaintiff’s home forum, without regard to the inconvenience to the defendant at having to defend an action in that forum or whether the defendant has engaged in substantial activities in that forum.”
Instead, the Indiana court considered the underlying substance of the dispute: “whether the Defendant’s Square Donuts trademark is valid and, if it is, whether the Plaintiff nevertheless has refrained from infringing on the trademark in connection with the sale of its Square Donuts.” The court concluded that, given the extent to which the claims and events at issue in the litigation took place in both the Northern and the Southern District of Indiana, venue was not improper in the Northern District of Indiana.
Practice Tip #1: If neither subsection (b)(1) nor (b)(2) of 28 U.S.C. § 1391 applies, a third subsection may be utilized. That subsection, 28 U.S.C. § 1391(b)(3), permits venue in “any judicial district in which any defendant is subject to the court’s personal jurisdiction with respect to such action.”
Practice Tip #2: An inquiry into proper venue for a lawsuit is different from one into personal jurisdiction. Personal jurisdiction “goes to the court’s power to exercise control over a party,” while venue is “primarily a matter of choosing a convenient forum.”
Chicago, Illinois – The Seventh Circuit ruled in the ongoing intellectual property litigation between Plaintiff Lightspeed Media Corp. and Defendants Anthony Smith et al.
Attorneys for Lightspeed Media Corp. have filed numerous lawsuits nationwide in an apparent attempt to extract quick settlements from individual users who would rather avoid litigating their pornography consumption in open court. After pushback from Defendants and their internet service providers, as well as the imposition of sanctions by the Central District of California in a similar case, the attorneys began to voluntarily dismiss some of the cases.
The litigation against Defendant Smith was one such dismissed lawsuit. After the dismissal, Smith filed a motion for attorney’s fees. The Southern District of Illinois found that the Lightspeed lawsuit had been frivolous, baseless, and “smacked of bullying pretense,” and imposed sanctions of $261,025.11, jointly and severally, against three lawyers for Lightspeed: Paul Hansmeier, John Steele, and Paul Duffy.
Much legal wrangling ensued. While pleading to the court an inability to pay the sanctions, Steele withdrew over $300,000 from an account that he shared with his wife. Hansmeier withdrew a similar amount from one of his accounts. Each of these transfers was apparently an attempt to conceal the funds from the court and Smith. Other actions, also apparent attempts to conceal the funds, were also taken by the attorneys. Following these actions, Hansmeier filed for bankruptcy and Duffy passed away.
The Seventh Circuit was asked to consider the appropriateness of the sanction against the three attorneys. It declined to hear the matter as to Duffy, stating that because he was deceased he was “beyond [their] jurisdiction.” The appeals court dismissed the appeal as to Hansmeier, noting that, in a liquidation proceeding under Chapter 7 of the bankruptcy code, “only the trustee [of the bankruptcy estate] has standing to prosecute or defend a claim belonging to the estate.”
After a review of multiple instances of discovery misconduct, the appellate court held that the district court had acted within its discretion in imposing a discovery sanction against Steele for what it called a “pattern of vexatious and obstructive conduct” and “obviously egregious behavior.”
The appellate court then turned to the matter of the contempt sanction against Steele. Steele argued that the sanction was in fact criminal in nature, not civil. Thus, he contended, the district court had failed to abide by the enhanced procedural safeguards required for such a sanction.
The Seventh Circuit agreed. It held that, while “civil contempt may be imposed if proven by clear and convincing evidence, and without the full criminal procedural process,” imposing criminal contempt required more. Specifically, it required that the contemnor be “afforded the protections that the Constitution requires of such criminal proceedings.”
The appellate court also held that the fine, as ordered by the district court, was not “designed either to compel the contemnor into compliance with an existing court order or to compensate the complainant for losses sustained as a result of the contumacy,” as was appropriate for a finding of civil contempt. Instead, the sanctions that had been levied against Steele were punitive in nature, and “meant to vindicate the authority of the court.” Thus, they were properly deemed criminal sanctions.
Concluding that the procedures required under the Constitution for criminal contempt had not been applied, the Seventh Circuit vacated the contempt sanction.