Indiana Intellectual Property Law News

December 5, 2013

Patent Office Issues 168 Patents To Indiana Citizens in November, 2013

The US Patent Office issued the following 168 patent registrations to persons and businesses in Indiana in November, 2013, based on applications filed by Indiana Patent Attorneys:

Patent No.		Title
8,594,760		In vivo analyte monitor with malfunction detection
8,593,627		Apparatus and method for inspecting the inner surface of a tubular structure for contamination
8,593,284		System and method for reporting status of a bed
8,593,021		Coolant drainage system and method for electric machines
8,592,859		Methods and apparatus for antimonide-based backward diode millimeter-wave detectors
8,592,775		Radiation detector having a ribbed scintillator
8,592,756		Systems and methods for transfer of ions for analysis
8,592,653		Corn event DAS-59122-7 and methods for detection thereof
8,592,645		Engineered zinc finger proteins targeting plant genes involved in fatty acid biosynthesis
8,592,617		Redox mediators

December 4, 2013

148 Trademark Registrations Issued to Indiana Companies in November, 2013

By Overhauser Law Offices, LLC

The US Trademark Office issued the following 148 trademark registrations to persons and businesses in Indiana in November, 2013, based on applications filed by Indiana Trademark Attorneys:

Reg. Number	Mark	Click to View
86009867	MODELLO	VIEW
85907743	PAPERLESSME	VIEW
85904534	CIRCLESCOUT	VIEW
85904352	THE HYPE MAGAZINE	VIEW
85902890	SPECIALTY SHOOTERS	VIEW
85897977	EGO COMPRESSOR	VIEW
85896006	TIRES DESIGNED FOR CHAMPIONS	VIEW
85887424	TWO FIT GIRLS PERSONAL TRAINING & FITNESS	VIEW
85886638	ORIGINAL MAN CANDLE	VIEW
85886194	A-S-B ACCREDITATION SERVICES BUREAU	VIEW
85882818	WASHINGTON NATIONAL INSTITUTE FOR WELLNESS SOLUTIONS	VIEW

December 2, 2013

Wounded Warrior Project Sues Help Indiana Vets for False Advertising, Defamation and Unfair Competition

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Wounded Warrior Project, Inc. (“WWP”) of Jacksonville, Florida has sued in the Southern District of Indiana alleging that Dean M. Graham and Help Indiana Vets, Inc. (“HIVI”), both of Acton, Indiana, defamed WWP. The lawsuit also asserts that HIVI engaged in false advertising and unfair competition. While this suit did not allege trademark infringement, it included references to WWP’s trademark, U.S. Trademark Registration No. 30014447, which has been registered by the U.S. Trademark Office.

WWP is a Virginia nonprofit corporation, which has been registered with the Internal Revenue Service (“IRS”) as a 501(c)(3) nonprofit organization. It was founded in 2003 as a small nonprofit corporation to provide comfort items to service members injured in combat after September 11, 2001. In the years which followed, WWP grew into a complete rehabilitative effort to assist service members injured in combat with both visible and invisible injuries (such as post-traumatic stress disorder, combat and operational stress, and depression) as they recover and transition back to civilian life.

HIVI is believed to be an Indiana nonprofit corporation. WWP indicates that HIVI was founded in April 2013 by Graham. WWP asserts that HIVI’s business is to offer financial help to Indiana veterans through donor support as a nonprofit. As such, WWP contends, HIVI is a direct competitor of WWP.

WWP asserts that, over the last decade, it has invested substantial time and resources to develop the WWP mark through national direct-mail campaigns, marketing, corporate product promotions and press releases. WWP indicates that it has received substantial national and local press coverage for its efforts. It claims that its success is due in no small part to the support of the media and celebrities who support WWP. Finally, WWP indicates that, over the last decade, it has received approximately 30 billion media impressions with an estimated publicity value of $500 million. WWP claims that, due to its efforts, the WWP mark has become famous.

This suit is founded upon, inter alia, WWP’s contentions that HIVI published false and misleading statements of fact regarding WWP. The assertions allegedly made by HIVI included that Wounded Warrior Project is a fraud and that it is pulling the biggest “Oke Doke” ever pulled on the American public. WWP contends that, on the page containing the purportedly false and misleading statements about WWP, a PayPal link is included so that users of the HIVI site may make charitable donations to HIVI.

WWP further alleges that HIVI has contacted numerous government entities and officials, as well as multiple media outlets, claiming that WWP is a fraud.

Trademark attorneys for WWP assert the following in their complaint against Graham and HIVI:

• Count I: False Advertising – Lanham Act
• Count II: Criminal Deception – Indiana Crime Victims Act
• Count III: Defamation – Indiana Common Law
• Count IV: Unfair Competition – Indiana Common Law
• Count V: Tortious Interference with Business Relationships – Indiana Common Law
• Count VI: Unjust Enrichment – Indiana Common Law

WWP asks the court for a permanent injunction; treble damages under the Indiana Crime Victims Act; an order compelling Defendants to disgorge all financial benefits realized as a result of the alleged wrongful conduct; and an award of costs and attorneys’ fees.

Practice Tip: Paul Overhauser was interviewed regarding this unusual lawsuit between nonprofit entities. See here.

November 29, 2013

U.S. Patent and Trademark Office Selects San Jose City Hall as Permanent Space for Silicon Valley Satellite Office

By Overhauser Law Offices, LLC

Washington, D.C. – The U.S. Department of Commerce’s United States Patent and Trademark Office (“USPTO”) recently announced that the San Jose City Hall building, located at 200 East Santa Clara Street, has been selected as the permanent location for the USPTO’s Silicon Valley satellite office. The search for permanent office space was put on hold in July due to sequestration. Generous support and assistance from the City of San Jose, the California State Assembly’s Speaker’s Office, along with the collective support for the satellite office championed by members of the California congressional delegation, will enable the USPTO to move forward with occupying permanent space in Silicon Valley by the end of 2014.

Days before the selection, U.S. Secretary of Commerce Penny Pritzker outlined her “Open for Business Agenda.” Promoting American innovation is a core priority of the Agenda, as technology and innovation are key drivers of U.S. competitiveness, wage and job growth, and long term economic growth. The selection of a permanent USPTO office in the Silicon Valley is a key part of the Commerce Department’s efforts to boost America’s innovation economy.

“A permanent USPTO office in Silicon Valley will help grow the regional innovation ecosystem by empowering entrepreneurs to more readily navigate the nation’s intellectual property system,” said U.S. Secretary of Commerce Penny Pritzker. “The USPTO plays a crucial role in helping protect the cutting-edge ideas that drive our economy and keep the U.S. globally competitive. The permanent satellite offices help advance the Commerce Department’s innovation agenda by helping entrepreneurs get their products to market more quickly, provide resources tailored to the needs of local start-ups, and create good paying, high-skilled jobs.”

November 27, 2013

Eli Lilly Sues Actavis for Infringement of Patents Related to Axiron

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Eli Lilly and Company of Indianapolis, Indiana; Eli Lilly Export S.A. of Geneva, Switzerland (collectively, “Lilly”); and Acrux DDS Pty Ltd. of West Melbourne, Australia have filed a patent infringement lawsuit in the Southern District of Indiana alleging that Actavis, Inc. and Actavis Pharma, Inc., both of Parsippany, New Jersey, and Watson Laboratories, Inc. of Corona, California infringed Patent Nos. 6,299,900 – Dermal Penetration Enhancers and Drug Delivery Systems Involving Same; 6,818,226 – Dermal Penetration Enhancers and Drug Delivery Systems Involving Same; 6,923,983 – Transdermal Delivery of Hormones; 8,071,075 – Dermal Penetration Enhancers and Drug Delivery Systems Involving Same; 8,419,307 – Spreading Implement; and 8,435,944 – Method and Composition for Transdermal Drug Delivery (collectively, the “patents-in-suit”) which have been issued by the U.S. Patent Office.

Lilly is engaged in the business of research, development, manufacture and sale of pharmaceutical products. Acrux is engaged in the development and commercialization of pharmaceutical products. Both sell their products worldwide.

Actavis, Inc., along with its wholly owned subsidiaries Actavis Pharma and Watson Laboratories, (collectively, “Actavis”) are pharmaceutical companies that develop, manufacture, market and distribute generic pharmaceutical products for sale in the United States.

Lilly is the holder of approved New Drug Application No. 022504 for the manufacture and sale of a transdermal testosterone solution made at a concentration of 30 mg/1.5L, which it markets under the trade name “Axiron®.” This drug is used to treat males for conditions associated with a deficiency or absence of endogenous testosterone.

This action relates to the Abbreviated New Drug Application (“ANDA”) No. 205328 submitted by Watson Laboratories to the U.S. Food and Drug Administration (“FDA”) for approval to market a generic version of Lilly’s Axiron product. Defendants certified to the FDA that, in their opinion, the patents-in-suit were invalid, unenforceable and/or would not be infringed by the commercial manufacture, use or sale of the generic version of Axiron described in the ANDA.

As part of its ANDA filing, Defendants sent to Lilly and Acrux an “Offer of Confidential Access” which would allow limited access to Actavis’ ANDA. Lilly and Acrux were unsatisfied with the offer, stating that the restrictions it contained would prohibit crucial decision makers from having access to the ANDA. Lilly and Acrux also contended that the restrictions were improper as they were not directed to the purpose of protecting trade secrets and other confidential business information. While attempts to reach an agreement regarding access to the ANDA were made, they were not successful.

Plaintiffs contend that the submission of the ANDA to the FDA constitutes infringement by Defendants of the patents-in-suit. In their complaint, patent lawyers for Lilly and Acrux assert twenty-four separate counts related to patent infringement. For each of the patents-in-suit, there is one count of “Direct Infringement,” one count of “Inducement to Infringe,” one count of “Contributory Infringement” and one count for declaratory judgment.

The complaint asks for an injunction to stop Defendants from producing the generic version of Axiron until the expiration of Lilly’s patents-in-suit. In addition, Lilly asks that the court declare the patents to be valid and enforceable; that Defendants infringed upon all of the patents-in-suit by, inter alia, submitting ANDA No. 205328 to obtain approval to commercially manufacture, use, offer for sale, sell or import its generic version of the drug into the United States; that Defendants’ threatened acts constitute infringement of the patents-in-suit; that FDA approval of Defendants’ generic drug be effective no sooner than the expiration date of the patent that expires last; and that this is an exceptional case. Plaintiffs also ask for costs and attorneys’ fees.

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 issues with respect to the period of exclusivity. For a look at some of these issues, see here.

Practice Tip #2: An offer of confidential access to an ANDA “shall contain such restrictions as to persons entitled to access, and on the use and disposition of any information accessed, as would apply had a protective order been entered for the purpose of protecting trade secrets and other confidential business information.” 21 USC § 355(c)(3)(D)(i).

November 26, 2013

CleanTech Adds Western New York Energy as a Defendant in Patent Infringement Litigation

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Patent attorneys for GS CleanTech Corporation of Alpharetta, Georgia, have filed a patent infringement lawsuit in the Western District of New York alleging that Western New York Energy, LLC of Medina, New York infringed Patent Nos. 7,601,858, METHOD OF PROCESSING ETHANOL BYPRODUCTS AND RELATED SUBSYSTEMS, 8,008,516, METHOD OF PROCESSING ETHANOL BYPRODUCTS AND RELATED SUBSYSTEMS, 8,008,517, METHOD OF RECOVERING OIL FROM THIN STILLAGE, and 8,283,484, METHOD OF PROCESSING ETHANOL BYPRODUCTS AND RELATED SUBSYSTEMS, which have been issued by the U.S. Patent Office. The case was transferred to the Southern District of Indiana as part of Multidistrict Litigation No. 2181.

This Multidistrict Litigation (“MDL”) began with an assertion of patent infringement by CleanTech of the ‘858 patent, which was issued on October 13, 2009. CleanTech sued numerous Defendants alleging infringement of that patent shortly after its issuance. The Defendants accused of patent infringement in prior litigation include: Big River Resources Galva, LLC; Big River Resources West Burlington, LLC; Cardinal Ethanol, LLC; ICM, Inc.; LincolnLand Agri-Energy, LLC; David J. Vander Griend; Iroquois Bio-Energy Co., LLC; Al-Corn Clean Fuel; Blue Flint Ethanol, LLC; ACE Ethanol, LLC; Lincolnway Energy, LLC; United Wisconsin Grain Producers, LLC; Bushmills Ethanol, Inc.; Chippewa Valley Ethanol Co.; Heartland Corn Products and Adkins Energy, LLC.

Since September 29, 2011, when the court overseeing the MDL issued its order on claim construction with respect to the disputed claims of the ‘858 patent, patentees, GS CleanTech Corp., and its parent GreenShift Corp., have asserted three additional patents in the ‘858 patent family against the allegedly infringing Defendants, U.S. Patent Nos., 8,008,516 (the “‘516 patent”), 8,008,517 (the “‘517 patent”) and 8,283,484 (the “‘484 patent”) (the ‘858, ‘516, ‘517 and ‘484 patents are, collectively, the “‘858 patent family”).

In this current lawsuit, initiated in Western District of New York, subsidiary GS CleanTech Corp. is the sole Plaintiff. Patent lawyers for CleanTech assert the following counts against Western New York Energy:

• Count I: Infringement of U.S. Patent No. 7,601,858
• Count II: Infringement of U.S. Patent No. 8,008,516
• Count III: Infringement of U.S. Patent No. 8,008,517
• Count IV: Infringement of U.S. Patent No. 8,283,484

CleanTech asks the court for preliminary and permanent injunctions prohibiting further infringement of the patents-in-suit; an award of damages adequate to compensate CleanTech for the infringement that has occurred, but in no event less than a reasonable royalty for the use made of the inventions of the patents-in-suit as provided in 35 U.S.C. § 284, together with prejudgment interest from the date the infringement began; and an award to CleanTech of all remedies available under 35 U.S.C. §§ 284, 285 and 154(d).

Practice Tip: The United States Judicial Panel on Multidistrict Litigation, also known as the “MDL Panel” or, simply the “Panel,” consists of seven sitting federal judges, who are appointed to serve on the Panel by the Chief Justice of the United States. The job of the Panel is to (1) determine whether civil actions pending in different federal districts involve one or more common questions of fact such that the actions should be transferred to one federal district for coordinated or consolidated pretrial proceedings; and (2) select the judge or judges and court assigned to conduct such proceedings.

November 25, 2013

Eli Lilly Sues Singpet for Trademark Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Eli Lilly and Company of Indianapolis, Indiana has filed a trademark infringement lawsuit in the Southern District of Indiana alleging that Sebastian Wiradharma a/k/a Sebastian Singh (“Singh”) and Singpet Pte. Ltd., both of Singapore, infringed the trademark COMFORTIS, Registration Number 3,370,168, which has been registered by the U.S. Trademark Office.

Lilly, through its Elanco Animal Health Division, manufactures, markets and sells pet medicines, including flea-control preparations and treatments for parasitic infestations. It contends that it has made long and continuous of the name and mark “Elanco” in connection with veterinary preparations. It also asserts that it has long used the “Comfortis” mark, which was registered by the U.S. Trademark Office in 2008. Lilly claims that it has sold tens of millions of dollars’ worth of veterinary preparations, pet medicines and related goods and services under the Elanco and Comfortis marks.

Among Lilly’s products is Trifexis, a once-monthly veterinary medication, which contains the veterinary chemicals spinosad and milbemycin oxime. Trifexis is for the prevention of heartworms, fleas and intestinal worms. It is sold in the United States with what Lilly contends to be an inherently distinctive and non-functional trade dress. Trifexis is available only by prescription through licensed veterinarians. Lilly sells a similar product in Australia, with similar trade dress, under the name “Panoramis.”

Defendant Singh, who is allegedly the principal of Singpet, and Singpet do business over the Internet, including via websites at www.singpet.com, www.petcorporate.com, www.fleastuff.com and http://www.ourpetworld.net/home.asp, among others.

Defendants are accused of marketing and selling European and Australian versions of Elanco- and Comfortis-branded pet medicines to customers in the United States. Specifically, Lilly contends that Defendants market “Panoramis (Triflexis)” [sic] on their websites. While the Defendants are apparently based in Singapore, this marketing is allegedly directed at consumers in the United States. Lilly asserts that units designed for sale in markets such as Europe and Australia are neither intended nor authorized for sale in the United States.

Lilly further objects to the Defendants’ purported advertisement of units designed for the Australian and European markets as identical to or interchangeable with the units designed for sale in the United States. It states that that the Elanco-branded “Panoramis” pet medicines are materially different from its Elanco-branded “Trifexis” pet medicines sold in the United States.

Lilly contends that the Elanco- and Comfortis-branded pet medicines are tailored to meet the requirements of different geographic regions and countries to reflect the differences in language, climate, government regulations, units of measure, local addresses and telephone numbers, among other things.

Trademark attorneys for Lilly assert that Defendants are not authorized to use Lilly’s Elanco or Comfortis names and trade dress in connection with the sale of once-monthly spinosad and milbemycin oxime pet medicines outside of Australia. Lilly has sued Defendants, asserting willful infringement of its trademarks. It asserts the following in its complaint:

• First Claim for Relief: Trademark Infringement in Violation of Section 32 of the Lanham Act
• Second Claim for Relief: Unfair Competition in Violation of Section 43(a) of the Lanham Act
• Third Claim for Relief: False Advertising in Violation of Section 43(a) of the Lanham Act
• Fourth Claim for Relief: Unfair Competition in Violation of Indiana Common Law

Lilly asks for preliminary and permanent injunctions; damages, including treble damages; the Defendants to be required to notify all purchasers of the accused products, request the return of the products and refund the price paid; pre- and post-judgment interest and costs of the suit.

Practice Tip:

Lilly is objecting to the so-called “grey market” for its veterinary pharmaceuticals. Prices for drugs can vary considerably between countries, often as a result of government intervention in the market. As a result, a “grey market” – selling a drug intended for use in one country to consumers in another country – can emerge. In this complaint, Lilly has framed its objection to a grey market for its pet-care pharmaceuticals as an intellectual property dispute.

Intellectual property law requires a balancing of competing interests. On the one hand, innovation will be discouraged if inventors, authors and other creators of intellectual property are not allowed to benefit from their labors. Such a problem arises if others are allowed to use creators’ ideas without compensating them (the “free-rider problem”). On the other hand, the public good is promoted by encouraging free competition in the marketplace and easy alienability of property.

Under the first-sale defense to infringement, once a copy of an item protected by intellectual property laws has been sold to a purchaser, the creator of the intellectual property generally may not prevent that purchaser from reselling or otherwise disposing of the item. In patent and copyright law, the first-sale rule in most cases provides an absolute defense against infringement. In patent law, this is also referred to as “patent exhaustion.” As a result, the purchaser of a copy of the work and the owner of the intellectual property rights to that work may become competitors in the marketplace if the purchaser goes to resell a copy of the work.

The first-sale defense is not as broad in a trademark context. Enunciated in 1924 by the U.S. Supreme Court, the general rule for the resale of a trademark item provides that, after a trademark owner has sold a trademarked product, the buyer ordinarily may resell that product under the original mark without incurring any trademark liability. See Prestonettes, Inc. v. Coty, 264 U.S. 359 (1924). However, unlike patent or copyright law, trademark law has as one of its primary goals preventing confusion among potential purchasers. Typically, but not always, such confusion will not exist where a genuine article bearing an authentic trademark is sold. While there is a split among the circuits concerning the extent to which consumer confusion is a relevant factor, some hold that certain types of confusion about a product’s origin cause the first-sale defense to be inapplicable to the resale of a trademarked good. See Au-Tomotive Gold Inc. v. Volkswagen of America, Inc., 603 F.3d 1133, 1134 (9th Cir. 2010).

November 22, 2013

Hatch Introduces Legislation to Combat Patent Trolls

By Overhauser Law Offices, LLC

Washington, D.C. – Utah Senator introduces a bill which includes both fee shifting and bonding to stop the drain on the economy caused by patent trolls.

U.S. Senator Orrin Hatch (R-Utah), current member and former Chairman of the Senate Judiciary Committee, recently introduced legislation to address the growing threat of so-called “patent trolls.” Patent trolls purchase existing broad patents and then accuse businesses of infringing on those patents, in search of a financial settlement or litigation. Hatch’s legislation, the Patent Litigation Integrity Act (S. 1612), gives judges more opportunity to shift the costs and expenses of litigation, and gives defendants the opportunity to request a bond up front to prove the party seeking to assert a claim on the patent has adequate resources to turn over to the prevailing party if that party is successful in defending its claim.

“Patent trolls are a drain on the innovation in our country and their practices need to end,” Hatch said. “Many small businesses in Utah and throughout the country simply don’t have the resources to fight back against the predators in our patent system, and my bill gives them adequate resources to fight back. Fee shifting without the option to seek a bond is like writing a check on an empty account, and that’s why it’s important to include both in any legislation dealing with patent trolls. It’s my hope the Senate will act soon to put a stop to the patent trolls draining the innovation in our country and weakening our economy.”

November 21, 2013

Joe Hand Promotions Again in Court Asserting Unlawful Interception

By Overhauser Law Offices, LLC

Hammond, Indiana – Joe Hand Promotions, Inc. of Feasterville, Pennsylvania has filed a lawsuit in the Northern District of Indiana alleging that Miguel Serrato and Miguel Mexican Fusion Grill, LLC, both d/b/a Miguel’s Mexican Fusion Grill, all of Schererville, Indiana unlawfully intercepted and televised the Ultimate Fighting Championship 139: Mauricio “Shogun” Rua v. Dan Henderson, Championship Fight Program.

Joe Hand Promotions, a commercial distributor of sporting events, was granted exclusive rights to distribute via closed-circuit television the Ultimate Fighting Championship (“UFC”) Mauricio “Shogun” Rua v. Dan Henderson fight (the “Program”), which Joe Hand Promotions asserts was telecast nationwide on November 19, 2101 [sic].

In the complaint against Serrato and Miguel’s Mexican Fusion Grill, an intellectual property lawyer for Joe Hand Promotions has alleged such wrongful acts as interception, reception, publication, divulgence, display, exhibition, and “tortuous” [sic] conversion of the Program.

In addition to naming the separate legal entity which apparently owns Miguel’s Mexican Fusion Grill, Joe Hand Promotions has also sued Serrato as an individual, claiming that he had the right and ability to supervise the activities of Miguel’s Mexican Fusion Grill. Joe Hand Promotions asserts that those activities included the unlawful interception of its UFC Program.

Serrato and Miguel Mexican Fusion Grill, LLC have been accused of violating 47 U.S.C. § 605 and 47 U.S.C. § 553. The complaint also lists a count of conversion. Joe Hand Promotions seeks statutory damages of $100,000 for each willful violation of 47 U.S.C. § 605; $50,000 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. These claims have been made both against Miguel Mexican Fusion Grill, LLC and as personal liability claims against Serrato.

Practice Tip #1: Joe Hand Promotions has sued two entities: a limited liability company and an individual who is apparently a principal in that company. While limited liability companies are intended, as the name suggests, to limit the liability of the principals, they are not always successful in doing so. Where a principal is personally involved in certain types of illegal activity, legal mechanisms (such as a limited liability company) that are designed to shield the principal from liability may fail to do so.

Practice Tip #2: 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 alleging 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 #3: In addition to misspelled words, incorrectly numbered paragraphs and an assertion that every page is numbered “Page PAGE 7” [sic], this complaint asserts wrongdoing which occurred on “November 19, 2101.” It is then dated as having been signed on “November 8, 20134.” Such inexactitude is perhaps due in part to Joe Hand Promotions having filed hundreds upon hundreds of similar lawsuits. Nonetheless, at least in this case, such flaws in pleading might present a creative attorney with the opportunity to make at least one novel argument: given that, in this filing it is admitted that more than 18,000 years have passed between the date of the alleged illegal act and the time when the lawsuit was/will be initiated (although all 18,000+ years have yet to occur), the statute of limitations surely has, or will have, run at the time of the filing of the complaint.

November 20, 2013

Eli Lilly Sues Pet Supply, Pet Products Net and Graham Nelson for Trademark Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Eli Lilly and Company of Indianapolis, Indiana (“Lilly”) has filed a trademark infringement lawsuit in the Southern District of Indiana alleging that Graham Nelson, Zoja Pty Ltd. d/b/a Pet Supply International Ltd., and Pet Products Net, all of Australia, infringed the trademark COMFORTIS, Trademark Registration No. 3,370,168, which has been registered by the U.S. Trademark Office.

Lilly, through its Elanco Animal Health Division, manufactures, markets and sells pet medicines, including flea-control preparations and treatments for parasitic infestations. It contends that it has made long and continuous of the name and mark “Elanco” in connection with veterinary preparations. It also asserts that it has long used the “Comfortis” mark, which was registered by the U.S. Trademark Office in 2008. Lilly claims that it has sold tens of millions of dollars’ worth of veterinary preparations, pet medicines and related goods and services under the Elanco and Comfortis marks.

Among Lilly’s products is Trifexis, a once-monthly veterinary medication, which contains the veterinary chemicals spinosad and milbemycin oxime. Trifexis is for the prevention of heartworms, fleas and intestinal worms. It is sold in the United States with what Lilly contends to be an inherently distinctive and non-functional trade dress. Trifexis is available only by prescription through licensed veterinarians. Lilly sells a similar product in Australia, with similar trade dress, under the name “Panoramis.”

Defendants Nelson, Zoja, Pet Supply and Pet Products Net do business over the Internet, including at the website www.bestvaluepetsupplies.com. Among the products listed on their website is “Panoramis aka Trifexis.” While the companies are apparently based in Australia, the website indicates that they ship to the United States.

Lilly has sued Defendants over the sale of Panoramis to the United States. It asserts that units designed for sale in markets such as Europe and Australia are neither intended nor authorized for sale in the United States. Lilly further indicates that the Elanco- and Comfortis-branded pet medicines are tailored to meet the requirements of different geographic regions and countries to reflect the differences in language, climate, government regulations, units of measure, local addresses and telephone numbers, among other things.

Lilly objects to the Defendants’ purported advertisement of units designed for the Australian and European markets as identical to or interchangeable with the units designed for sale in the United States. It states that that the Elanco-branded “Panoramis” pet medicines are materially different from its Elanco-branded “Trifexis” pet medicines sold in the United States.

Trademark attorneys for Lilly assert that Defendants are not authorized to use Lilly’s Elanco or Comfortis names and trade dress in connection with the sale of once-monthly spinosad and milbemycin oxime pet medicines outside of Australia. Lilly has sued Defendants, asserting willful infringement of its trademarks. It asserts the following in its complaint:

• First Claim for Relief: Trademark Infringement in Violation of Section 32 of the Lanham Act
• Second Claim for Relief: Unfair Competition in Violation of Section 43(a) of the Lanham Act
• Third Claim for Relief: False Advertising in Violation of Section 43(a) of the Lanham Act
• Fourth Claim for Relief: Unfair Competition in Violation of Indiana Common Law

Lilly asks for preliminary and permanent injunctions; damages, including treble damages; the Defendants to be required to notify all purchasers of the accused products, request the return of the products and refund the price paid; pre- and post-judgment interest and costs of the suit.

Practice Tip:

Lilly is objecting to the so-called “grey market” for its veterinary pharmaceuticals. Prices for drugs can vary considerably between countries, often as a result of government intervention in the market. As a result, a “grey market” – selling a drug intended for use in one country to consumers in another country – can emerge. In this complaint, Lilly has framed its objection to a grey market for its pet-care pharmaceuticals as an intellectual property dispute.

Intellectual property law requires a balancing of competing interests. On the one hand, innovation will be discouraged if inventors, authors and other creators of intellectual property are not allowed to benefit from their labors. Such a problem arises if others are allowed to use creators’ ideas without compensating them (the “free-rider problem”). On the other hand, the public good is promoted by encouraging free competition in the marketplace and easy alienability of property.

Under the first-sale defense to infringement, once a copy of an item protected by intellectual property laws has been sold to a purchaser, the creator of the intellectual property generally may not prevent that purchaser from reselling or otherwise disposing of the item. In patent and copyright law, the first-sale rule in most cases provides an absolute defense against infringement. In patent law, this is also referred to as “patent exhaustion.” As a result, the purchaser of a copy of the work and the owner of the intellectual property rights to that work may become competitors in the marketplace if the purchaser goes to resell a copy of the work.

The first-sale defense is not as broad in a trademark context. Enunciated in 1924 by the U.S. Supreme Court, the general rule for the resale of a trademark item provides that, after a trademark owner has sold a trademarked product, the buyer ordinarily may resell that product under the original mark without incurring any trademark liability. See Prestonettes, Inc. v. Coty, 264 U.S. 359 (1924). However, unlike patent or copyright law, trademark law has as one of its primary goals preventing confusion among potential purchasers. Typically, but not always, such confusion will not exist where a genuine article bearing an authentic trademark is sold. While there is a split among the circuits concerning the extent to which consumer confusion is a relevant factor, some hold that certain types of confusion about a product’s origin cause the first-sale defense to be inapplicable to the resale of a trademarked good. See Au-Tomotive Gold Inc. v. Volkswagen of America, Inc., 603 F.3d 1133, 1134 (9th Cir. 2010).