Injunction

March 8, 2013

Continuation of At-Will Employment Held to be Adequate Consideration for Noncompetition Agreement

Indianapolis, IN – The Indiana Court of Appeals has reversed the decision of the Marion Superior Court to deny injunctive relief to Clark Sales & Service, Inc. (“Clark”) of Indianapolis, Indiana in its suit against John D. Smith (“Smith”) and Ferguson Enterprises, Inc. (“Ferguson”) of Newport News, Virginia.

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

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

Attorneys for plaintiff Clark sued to enforce the confidentiality and noncompetition provisions of the agreement entered into with Smith. The trial court granted Clark’s non-disclosure request and ordered the confidential documents to be returned but it denied Clark’s request for an injunction to enforce the noncompetition portion of the employment agreement. The trial court noted that there had been no incentive for Smith to agree to the noncompetition provision in the form of, for example, the commencement of a new job or a pay raise. It held that, as a result, the noncompetition agreement failed for lack of consideration.

Clark filed an interlocutory appeal. In a memorandum decision, the Indiana Court of Appeals found that the trial court had abused its discretion by denying the injunction and reversed the decision. The appellate court held that Indiana law, as enunciated by the Indiana Supreme Court, was that an employer’s promise to continue an employee’s at-will employment was sufficient consideration to support the employee executing a new employment contract with a noncompetition agreement. No raise or other additional incentive was required.

The appellate court remanded the matter to the trial court for further proceedings regarding the reasonableness of the noncompetition agreement.

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

March 7, 2013

DirecTV Sues Roger York, Dianna York and Marty’s Pub for Use of Residential Satellite Service in a Commercial Establishment

By Overhauser Law Offices, LLC

Indianapolis, IN – Intellectual property lawyers for DirecTV, LLC sued Roger York, Dianna York and D.L.Y., Inc. d/b/a Marty’s Pub of Converse, IN alleging the commercial use of satellite programming sold at the residential rate.

This suit was brought under the Cable Communications Policy Act of 1984, 47 U.S.C. §521, et seq., and 47 U.S.C. §605. It alleges that Roger York and Dianna York, in their capacity as owners, and individuals with close control over internal operating procedures, of Marty’s Pub willfully and unlawfully used a residential subscription to DirecTV in a commercial establishment.

The three-count complaint cites three causes of action. Count One: Damages for Violations of Cable Communications Policy Act under 47 U.S.C. §605(e)(3)(c); Count Two: Damages for Violations of 18 U.S.C. §2511; and Count Three: Civil Conversion.

DirecTV asks for the following: a declaration that the defendants’ use of DirecTV was a violation of §2511, that such violations were willful and for the purpose of commercial advantage; an injunction against further violations; statutory damages under 18 U.S.C. §2511; statutory damages under 47 U.S.C. §605; punitive damages and costs and interest.

Practice Tip: As part of its complaint, DirecTV claims that its goodwill and reputation have been usurped. It will be interesting to see what evidence it offers as proof that, as a result of allegedly receiving a lower monthly fee for the programming provided to the defendants – a circumstance presumably known to few other than the Yorks – its goodwill or reputation have been impacted.

February 28, 2013

Eli Lilly Sues Accord Healthcare Again for Infringement of Patented ALIMTA

By Overhauser Law Offices, LLC

Indianapolis, IN – Eli Lilly and Company of Indianapolis, Indiana filed an additional patent infringement suit in the Southern District of Indiana alleging that Accord Healthcare, Inc., USA of Durham, North Carolina will infringe U.S. Patent No. 7,772,209 (the “‘209 patent”) which has been issued by the U.S. Patent Office if relief is not afforded by the court.

In a complaint that was almost identical to a previous complaint filed in January 2012, patent attorneys for Eli Lilly and Company (“Lilly”) initiated an additional lawsuit against Accord Healthcare, Inc., USA (“Accord”) for attempting to gain FDA approval to manufacture and sell a generic version of Lilly’s ALIMTA, a drug that is used in the treatment in certain types of lung cancer. ALIMTA is protected by the ‘209 patent.

This is the second suit by Lilly against Accord involving the ‘209 patent. This suit was initiated after Accord filed an Abbreviated New Drug Application (“ANDA”) with the FDA for a product that competes with Lilly’s ALIMTA, which is an “Antifolate Combination Therapies” product. The complaint from 2012 alleged intent to infringe by, among other activities, the production and sale of Accord’s “Pemetrexed Disodium for Injection,” a generic version of ALIMTA, in 100 mg/vial and 500 mg/vial products. The current complaint alleged intent to infringe with a “Pemetrexed Disodium for Injection” product in a 1000 mg/vial strength. As part of its ANDA filing, Accord alleged that the claims of the ‘209 patent are invalid and/or not infringed by Accord’s product.

Eli Lilly has sued alleging infringement of the patented ALIMTA before:

· Eli Lilly Sues Apotex Inc. for Patent Infringement of ALIMTA

· Eli Lilly and Company Sues Accord Healthcare for Patent Infringement of Lung Cancer Drug ALIMTA

· Lilly Wins Patent Infringement Suit Regarding Chemotherapy Drug

· Eli Lilly Company Sues APP Pharmaceuticals LLC for Patent Infringement of Chemotherapy Drug

Lilly seeks a judgment that Accord has infringed and/or will infringe, actively induce infringement of, and/or contribute to infringement by others of the ‘209 patent; a judgment ordering that Accord delay virtually all activities pertaining to its ANDA product until after the ‘209 patent has expired; a preliminary and permanent injunction against activity that infringes upon the ‘209 patent; a declaratory judgment of infringement; a declaration that the case is exceptional and an award of attorneys’ fees pursuant to such a declaration; and Lilly’s costs and expenses.

Practice Tip #1: The FDA’s ANDA process for generic drugs has been abbreviated such that, in general, the generic drug seeking approval does not require pre-clinical (animal and in vitro) testing. Instead, the process focuses on establishing that the product is bioequivalent to the “innovator” drug that has already undergone the full approval process. The statute that created the abbreviated process, however, had also created some interesting jurisdictional issues with respect to declaratory judgments. For an interesting look at some of the issues, see here.

June 26, 2012

Dillinger Sues Pour House on Lincoln for Trademark Infringement of PUBLIC ENEMY

By Overhauser Law Offices, LLC

Indianapolis; IN – Trademark attorneys for Dillinger, LLC of Mooresville, Indiana filed a complaint for injunctive relief and damages in alleging The Pour House on Lincoln, Inc. d/b/a Dillinger’s Chicago Bar & Grill, Inc. of Chicago, Illinois infringed trademark registration nos. 3,483,359 for the mark DILLINGER’S and no. 4,091,160 for the mark PUBLIC ENEMY which have been registered by the US Trademark Office.

Dillinger, LLC is owned and operated by Jeff Scalf and, according to the Complaint, is the descendant of gentleman bandit John Dillinger. Dillinger, LLC owns numerous trademark registrations for DILLINGER, JOHN DILLINGER, PUBLIC ENEMIES, and many other trademarks related to the life of John Dillinger. Dillinger, LLC is also the owner of all rights, title, and interest to both DILLINGER’S and PUBLIC ENEMIES and both marks have been used in interstate commerce in connection with restaurant and bar services as early as 2002. According to the Complaint, Dillinger, LLC has never authorized The Pour House on Lincoln d/b/a Dillinger’s Chicago Bar & Grill to use the DILLINGER or PUBLIC ENEMIES marks in any way and also alleges that in July 2010 it came to their attention that the Defendants were operating a restaurant using the DILLINGER and PUBLIC ENEMIES trademarks. Upon their knowledge of the trademark usage, Dillinger, LLC alleges that The Pour House was contacted about the infringement and in August of the same year they traveled to Indianapolis for the purpose of obtaining a license for the use of the trademarks. The Complaint states that an oral agreement was reached and reduced to writing, but never executed and yet The Pour House willfully continued its infringing usage of the DILLINGER and PUBLIC ENEMIES trademarks, specifically on their website, food and drink menus and the menus posted on the storefront. Dillinger, LLC asserts five counts for the violations of the defendants, including demand for preliminary and permanent injunction; federal trademark infringement; cybersquatting; false designation of origin, false descriptions and unfair competition; and dilution by blurring. In order to avoid any irreparable harm from the loss of reputation the DILLINGER names could suffer as a result of the unauthorized use of the trademarks and the accrual thereof, Dillinger, LLC is seeking to permanently enjoin The Pour House from using the DILLINGER and PUBLIC ENEMIES trademarks or inducing such belief, actual damages suffered as a result of the alleged trademark violations, statutory and exemplary damages, and the profits derived from the infringing activities.

Practice Tip: U.S.C. title 15, chapter 22 governs trademarks, and §1117 specifically details the relief which can be granted as a result of trademark violation.
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June 5, 2012

Trademark to Colt’s Luck Jersey? Recent Trademark Infringement Case over Tim Tebow Products Illustrates Issues

By Overhauser Law Offices, LLC

New York, NY – The Southern District of New York recently issued an injunction in a case involving the trademark rights to NFL player Tim Tebow’s name and jersey. Trademark attorneys for Nike, Inc of Beaverton, Oregon, had filed a Trademark infringement lawsuit in the Southern District of New York alleging that Reebok, International Ltd of Canton, Massachusetts infringed Tebow’s trademarks by producing and selling jerseys and other products bearing the Tebow marks. The complaint stated that Nike had an exclusive license to produce Tebow products bearing the Tebow marks. The complaint alleges that following the Denver Bronco’s trade of Tebow to the New York Jets, Reebok tried to take advantage of the high demand for Tebow’s Jets jersey by offering and selling unlicensed Tebow products.

On April 9, 2012, the court approved a final judgment that recognized Nike, Inc. was awarded the sole rights to the license–including the manufacture, distribution, and sale–of Tim Tebow merchandise, retroactive February 28, 2012, affiliated with the New York Jets. The court order defined Unauthorized Tebow Product as “an NFL-related jersey or t-shirt product sold or distributed by, manufactured by or for, or in the possession or control of Defendant Reebok International Ltd. . . . with the name Tebow affixed to the product after February 28, 2012.” The definition specifically targets any Tebow merchandise produced with his new team, the New York Jets. The terms of the court order issued prohibit Reebok from manufacturing, selling, donating, advertising or permitting any other individual or entity to do the an Unauthorized Tebow Product. Reebok was further ordered to repurchase or recall any existing Tebow merchandise already in distribution that was made after February 28, 2012.

Practice Tip: It will be interesting to see how valuable the trademark rights to number one draft pick Andrew Luck‘s jersey and his new affiliation with the Indianapolis Colts will become. Nike argued that the Tebow trademark was particularly valuable because of his high profile. He was already a prize at Stanford, and with his contract with the Colts, the trademark rights could be very valuable.

May 10, 2012

Southern District Grants Preliminary Injunction for American Petroleum Institute in Trademark Infringement Suit Over API Logo

By Overhauser Law Offices, LLC

Indianapolis; IN – Judge Tanya Walton Pratt of the Southern District of Indiana has issued a preliminary injunction enjoining Tailor Made Oil Company of Cambridge City, Indiana, TM Oil, LLC of Fishers, Indiana, Circle Town Oil of Fishers, Indiana, et al from infringing trade names API and AMERICAN PETROLEUM INSTITUTE and trademark registration nos. 1,864,428, 1,868,779 and 1,872,999, which have been registered with the US Trademark Office by the American Petroleum Institute (API) of Washington, DC.

Trademark lawyers for American Petroleum Institute (“API”) of Washington, D.C. filed a trademark infringement suit in alleging Tailor Made Oil Co., LLC of Cambridge City, Indiana, TMO Oil, LLC of Fishers, Indiana, Circle Town Oil of Fishers, Indiana, William R. Selkirk and Rebecca Selkirk of Cambridge City, Indiana, Lincoln R. Schneider of Fishers, Indiana and Jafarikal Corporation of Rosedale, New York infringed trademark. The complaint alleges that the individual defendants own and operate the corporate defendants as an interrelated business that offers low quality engine oil for sale. In March 2010, Tailor Made obtained certification for its engine oil, and a one year license to use the starburst mark on its products. In order to renew the one year license, Tailor Made was required to report its sales and to pay a renewal fee to API. Tailor Made failed to comply with these requirements and has continued to sell products bearing the trademarked starburst without authorization. We blogged about the case when it was filed.

The court’s order states that the defendants did not contest API’s motion for preliminary injunction. The parties submitted a joint proposed order, but did not agree on all aspects of the proposed order. The injunction ordered by the court prevents the defendants from registering or using any infringing marks. It also requires that the Jafarikal Corporation must notify API of its intent to distribute engine oil bearing the API marks and allow API to test any engine oil it distributes bearing the API marks.

Practice Tip: The order ordered that the defendants submit an affidavit of compliance within 10 business days of the injunction.

October 20, 2011

Federal Circuit Court Grants Injunction in Patent Infringement Suit Over Windshield Wiper Blade Technology

By Overhauser Law Offices, LLC

Washington, D.C. — The Honorable Circuit Judges Kathleen O’Malley, Jimmie V. Reyna and William C. Bryson of the U.S. Court of Appeals for the Federal Circuit have issued a permanent injunction in a patent infringement lawsuit, overruling the denial of the injunction by the District Court of Delaware. Patent lawyers for Robert Bosch LLC of Farmington Hills, Michigan, who had filed a patent infringement lawsuit in the District Court of Delaware alleging that Pylon Manufacturing Corporation of Deerfield Beach, Florida, infringed patent no. 6,292,974 Glass wiper blade for motor vehicles, patent no. 6,675,434 Wiper blade for the glass surfaces of motor vehicles with an elongated, spring-elastic support element, and patent no. 6,978,512 Wiper blade for cleaning vehicle windows, which have been issued by the US Patent Office.

The technology at issue is a beam-type automobile windshield wiper blade that perform better than traditional windshield wipers. Pylon is a competitor windshield wiper blade manufacturer. Patent attorneys for Bosch filed this patent infringement lawsuit in 2008 in the District Court of Delaware. On March 31, 2010, the district court granted Pylon’s motion for summary judgment of noninfringement of the ‘512 patent, but denied summary judgment of noninfringement of the two other patents. The remaining issues were tried by jury, which found that claim 13 of the ‘974 and ‘434 patents had been infringed. Bosch then filed a motion for a permanent injunction. The district court denied the permanent injunction, and this ruling is the subject of the Federal Circuit court opinion today.

The Federal Circuit reversed the district court and issued the injunction. The court found that the district court made legal errors in applying the standard for a permanent injunction. The district court also erred in concluding that Bosch had not demonstrated an irreparable harm. Bosch introduced evidence of loss of market share and access to potential customers. The Federal Circuit found that this evidence did demonstrate an irreparable injury. Judge William C. Bryson dissented in part, stating he would have remanded the case to the district court to appropriately apply the correct standard.

Practice Tip: In this case, the Federal Circuit affirmed the standard for granting a permanent injunction in a patent infringement case. The patentee must make a four-part showing:

(1) that it has suffered an irreparable injury; (2) that remedies available at law, such as monetary damages, are inadequate to compensate for that injury; (3) that, considering the balance of hard-ships between the plaintiff and the defendant, a remedy in equity is warranted; and (4) that the public interest would not be disserved by a per-manent injunction.

eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 391 (2006). Prior to the eBay case, an injunction normally would issue when there a finding that a patent is valid and has been infringed. However, the Federal Circuit Court’s opinion today seems to bolster the availability of injunctions when patent infringement has been found.

June 9, 2011

Alcon Research Sues Watson Laboratories Inc for Patent Infringement of Allergy Eye Drops

By Overhauser Law Offices, LLC

Indianapolis, IN – Patent lawyers for Alcon Research Ltd of Fort Worth, Texas, Alcon Pharmaceuticals LTD of Switzerland, and Kyowa Haddo Kirin Co. of Japan filed a patent infringement in alleging Watson Laboratories Inc and Watson Pharma, Inc. of Parsippany, New Jersey, and Watson Laboratories, of Corona, California, infringed the following patent prior to the expiration:

Patent No. 5,641,805, Topical ophthalmic formulations for treating allergic eye diseases, Patent No. 6,995,186, Olopatadine formulations for topical administration and Patent No. 7,402,609, Olopatadine formulations for topical administration, which have been issued by the US Patent Office.

The Complaint alleges that Watson has filed an Abbreviated New Drug Application (“ANDA”) with the Food and Drug Administration “seeking approval to manufacture and sell a generic version of PATADAY™ ophthalmic solution,” a drug product that is covered by several patents owned by Alcon. The Complaint states that Watson sent a letter to Alcon on April 27, 2011 notifying Alcon of Watson’s ANDA and intent to manufacture and sells products covered by the ADNA. According to Alcon, Watson’s April 27 letter and ANDA stated that Alcon’s patents are invalid, unenforceable and/or will not be infringed. Alcon has made three claims of patent infringement and three claims for a declaratory judgment of infringement. Alcon’s patent attorneys are seeking an injunction, declaratory judgment, attorney’s fees and costs. Alcon has alleged that the basis for jurisdiction of the Southern District of Indiana is that Watson markets and sells drug products nationwide and in Indiana.

Practice Tip: Alcon’s patent attorneys filed this case before apparently before Watson actually sold any allegedly infringing products. Hence, they are seeking an injunction to prevent any potentially infringing sales as well as a declaration judgment of infringement, rather than monetary damages. These remedies, if granted, could prevent monetary damages that could occur if infringing products are sold. The Patent Act, 35 U.S.C. § 283, allows a court with jurisdiction to grant an injunction “to prevent the violation of any right secured by patent, on such terms as the court deems reasonable.”