Breach of Contract

March 27, 2017

Indiana Patent Litigation: Parties Return to Court Over Allegations of Ongoing Infringement of Patent for Foldable Tricycle

Indianapolis, Indiana – Newton Enterprises Ltd. of Kowloon, Hong Kong filed a lawsuit in the Southern District of Indiana against Defendant Singleton Trading Inc. d/b/a Elama d/b/a Blue Spotlight of Brooklyn, New York asserting patent infringement and breach of contract.

These claims follow earlier litigation against Singleton initiated by Newton in June 2016. That lawsuit, also filed in Indiana, alleged that Singleton Trading had infringed and/or induced others to infringe U.S. Patent No. 7,568,720 (the “‘720 patent”) for a “Wheeled Vehicle” with its “Zoom Bike” product.

Newton states that the 2016 action was dismissed without prejudice pursuant to a settlement agreement under which Singleton agreed to compensate Newton for its claims of past infringement and “permanently cease making, using, offering to sell, or selling the Zoom Bike” or any other product that infringed the ‘720 patent. Under the agreement, Singleton was granted a limited license to sell its remaining inventory.

Newton now returns to the court alleging that Singleton has breached the settlement agreement by selling units of the Zoom Bike exceeding the scope of the limited license. Newton further contends that this conduct constitutes willful infringement of the ‘720 patent.

This second complaint, filed by an Indiana patent lawyer, lists two counts:

Count I: Infringement of ‘720 Patent
Count II: Breach of Settlement Agreement

Newton asks the court for a declaration of willful patent infringement; damages, including a trebling of those damages; costs and attorneys’ fees; and injunctive relief.

March 1, 2017

Indiana Trademark Litigation: Choice Hotels Alleges Former Franchisee is Infringing Econo Lodge Trademarks

By Overhauser Law Offices, LLC

Lafayette, Indiana – Choice Hotels International, Inc. of Rockville, Maryland sued in the Northern District of Indiana alleging trademark infringement under federal and Indiana law.

Choice Hotels is in the business of franchising hotels. It offers hotel and motel services under the following brands: CAMBRIA HOTELS & SUITES®, COMFORT INN®, COMFORT SUITES®, QUALITY®, SLEEP IN®, CLARION®, MAINSTAY SUITES®, SUBURBAN EXTENDED STAY HOTEL®, ECONO LODGE®, and RODEWAY INN®.

At issue in this Indiana trademark litigation is the Econo Lodge family of trademarks. These trademarks include U.S. Trademark Nos.:

January 20, 2017

Indiana Court of Appeals Rules on Irreparable Harm in Breach of Non-Compete/Non-Solicitation Agreements

By Overhauser Law Offices, LLC

Indianapolis, Indiana – The Indiana Court of Appeals affirmed the judgment of the Marion Superior Court in litigation between two civil engineering firms, Plaintiff American Structurepoint Inc. and Defendant HWC Engineering Inc. Three former employees of ASI, also listed as Defendants in the trial court, were listed in this appeal.

This dispute arose in 2014 when ASI employee Martin Knowles left ASI to join HWC as its vice president of operations. Jonathan Day and David Lancet also left ASI to begin employment at HWC.

These former ASI employees had entered into noncompetition and non-solicitation agreements with ASI. Despite these agreements, ASI contended in a lawsuit filed in Indiana state court that its former employees engaged in various acts prohibited by the agreements. ASI claimed that Day had created a list of ASI employees whom he believed might be interested in leaving to join HWC. ASI also asserted that Day subsequently shared that list with Knowles and called various ASI employees regarding employment with HWC. ASI alleged that a total of six job offers were made by HWC to ASI employees. ASI further introduced evidence that Knowles engaged in prohibited business-development activities with ASI clients to ASI’s detriment.

December 30, 2016

Indiana Trademark Litigation: Super 8 Sues Former Franchisees for Infringement

By Overhauser Law Offices, LLC

Fort Wayne, Indiana – Super 8 Worldwide, Inc. f/k/a Super 8 Motels, Inc. of Parsippany, New Jersey sued in the Northern District of Indiana alleging trademark infringement and other wrongdoings.

Plaintiff Super 8 operates a franchise system for guest lodging. It claims ownership to the SUPER 8® service mark as well as various related trade names, trademarks and service marks, some of which have been registered with the U.S. Patent and Trademark Office. It estimates the value of the entity’s goodwill to exceed hundreds of millions of dollars.

In this Indiana intellectual property lawsuit, Super 8 alleges that former franchisees have violated the terms of a franchise agreement entered into with Super 8. Three Indianapolis Defendants were listed: Auburn Lodging Associates, LLP (“ALA”), Kokila Patel and Dilip Patel. A fourth Defendant Chicago Capital Holdings, LLC (“CCH”) of Hinsdale, Illinois was also named.

September 8, 2016

Indiana Copyright Litigation: Airbrushing Firm Sues Boat Seller for Copyright Infringement, Breach of Contract

By Overhauser Law Offices, LLC

South Bend, Indiana – Copyright lawyers for Plaintiff The Art of Design, Inc. of Elkhart, Indiana filed an intellectual property lawsuit in the Northern District of Indiana. Defendants in this Indiana lawsuit are Pontoon Boat, LLC d/b/a Bennington and Bennington Marine of Elkhart, Indiana and Hawkeye Boat Sales, Inc. of Dubuque, Iowa.

Plaintiff is in the business of custom airbrushing, including the airbrushing of copyrighted art works onto different surfaces. Defendants offer marine goods, including pontoon boats. In 2011, Plaintiff and Bennington entered into an agreement wherein Bennington paid Plaintiff to apply copyrighted graphics, titled “Shatter Graphics,” to a limited number of Bennington’s pontoon boats in exchange for payment.

Plaintiff contends that, following this authorized application of Shatter Graphics to Defendants’ pontoon boats, Defendant made further use of the copyrighted design without Plaintiff’s authorization.

In this Indiana litigation, Plaintiff makes several allegations, including accusing Defendant of copyright infringement for the sale of pontoon boats bearing graphics “that are copied from and substantially similar to” Plaintiff’s Shatter Graphics, which has been registered with the U.S. Copyright Office under Registration numbers VA 1-979-388 and 1-982-002. The lawsuit lists the following claims for relief:

• Count I – Breach of Contract against Bennington
• Count II – Unjust Enrichment against all Defendants
• Count III – Copyright Infringement against all Defendants
• Count IV – Unfair Competition against all Defendants
• Count V – Inducing Copyright Infringement against Bennington

• Count VI – Violations of DMCA, 17 U.S.C. § 1202

Plaintiff is seeking damages, including treble damages, as well as equitable relief, costs and attorneys’ fees.

Practice Tip: Plaintiff’s copyright attorneys also represent frequent litigant Design Basics. We have blogged about Design Basics’ Indiana copyright litigation before. See:

• Design Basics Sues Fort Wayne Homebuilders
• Creator of Architectural Designs Files Two New Copyright Lawsuits
• Design Basics Files Three New Indiana Copyright Lawsuits
• Architecture Firms File Four New Infringement Lawsuits
• Design Basics Files Two New Copyright Lawsuits
• Architecture Firm Files New Lawsuit Asserting Infringement
• Design Basics Files Two Additional Infringement Lawsuits in the Northern District
• Design Basics Files Additional Indiana Lawsuit

• Design Basics Sues Builders and Others Alleging Infringement of Copyrighted Architectural Designs

June 24, 2016

Indiana Trademark Litigation: Fitness Studio Operator Accused of Trademark Infringement, Fraud

By Overhauser Law Offices, LLC

Indianapolis, Indiana – A Massachusetts trademark lawsuit filed in July 2015 was transferred to the Southern District of Indiana, Indianapolis Division. Plaintiff Get In Shape Franchise, Inc. (“GIS”), a Massachusetts-based franchisor, alleges that Defendants TFL Fishers, LLC and its sole member, Rosalyn Harris; Thinner For Life, Inc.; and Fit Chicks, LLC, all of Fishers, Indiana infringed its intellectual property rights. GIS asks the Indiana federal court: (1) to order the discontinuation of Defendant’s infringement of its registered trademarks; (2) for injunctive relief due to breach of contract, unfair competition and breach of the covenant of good faith; (3) to order compliance by Harris of her post-contractual obligations.

GIS sells fitness franchises under the service mark “Get In Shape For Women.” Registration Certificates for Plaintiff are as follows:

MARK	Reg. No.	Reg. Date
“Get in Shape for Women”	Service Mark Reg. 3,374,173	Jan. 22, 2008
“Your treatment is complete”	Service Mark Reg. 4,241,902	Nov. 13, 2012
“Get in Shape for Women Small Group Personal Training”	Service Mark Reg. 4,249,694	Nov. 27, 2012

Plaintiff contends that it entered into such a franchise agreement with TFL Fishers and Harris in April 2013 for use in the Fishers, Indiana market. This agreement provided for payment to the franchisor of a transfer fee as well as a royalty on the franchise’s gross sales. Plaintiff contends that, pursuant to the agreement, Harris also agreed to various restrictions on her activities, including prohibitions on certain activities that would compete with GIS.

According to the complaint, Harris notified GIS on June 24, 2015 that TFL Fishers was discontinuing its franchised business and had closed its Fishers fitness studio. Instead, contends Plaintiff, it discovered on June 30th that the Fishers studio continued to operate but that it had changed its name to “Fit Chicks.” GIS alleges that this was improper. It also accuses Defendants of other wrongful acts, such as willfully underreporting total sales and, consequently, underreporting the royalty fees due to GIS.

Trademark attorneys for Plaintiff list the following claims for the Indiana federal court’s review and adjudication:

• First Cause of Action: Violation of the Lanham Act
• Second Cause of Action: Breach of Contract – Injunctive Relief
• Third Cause of Action: Breach of Contract – Damages
• Fourth Cause of Action: Breach of the Covenants of Good Faith and Fair Dealings
• Fifth Cause of Action: Unjust Enrichment
• Sixth Cause of Action: Unfair Competition

• Seventh Cause of Action: Fraud

Plaintiff seeks damages, including treble damages, along with enforcement of the franchise agreement, equitable relief, attorney’s fees and costs.

December 14, 2015

Indiana Copyright Litigation: Copyright Defendant Removes Lawsuit to Federal Court

By Overhauser Law Offices, LLC

Indianapolis, Indiana – An Indiana copyright lawyer for Defendant Wrightspeed, Inc. of San Jose California filed a notice of removal in the Southern District of Indiana on the basis of both federal-question jurisdiction and diversity-of-citizenship jurisdiction.

Plaintiff Precision Rings, Inc. of Indianapolis, Indiana had filed its lawsuit in Marion County Superior Court seeking declaratory relief, injunctive relief, unspecified damages and attorney’s fees. Among Plaintiff’s contentions was the breach of a nondisclosure agreement. Included in this alleged breach was the misappropriation of Plaintiff’s trade secrets, which involved the use or disclosure by Defendant of certain copyrighted drawings that Plaintiff had registered with the U.S. Copyright Office.

Defendant Wrightspeed contended that federal-question jurisdiction was proper and asked that the federal court in the Southern District of Indiana hear and decide all further matters in the litigation. Defendant asserted that the complaint arose under copyright law because Plaintiff’s complaint included a claim that would require construction of the Copyright Act. Consequently, subject matter jurisdiction rested exclusively in federal court.

Defendant Wrightspeed also asserted that diversity-of-citizenship jurisdiction was a proper basis for the Indiana federal court to hear the litigation. The parties were completely diverse, it stated, with Plaintiff being a citizen of Indiana and Defendant being a citizen of both Delaware and California. Defendant contended further that, considering the potential damages, fees and costs, the amount at stake was well in excess of the $75,000 threshold necessary for diversity-of-citizenship jurisdiction.

October 26, 2015

Indiana Patent Litigation: German Lawyers and Law Firm Sued on Allegations of Misappropriation of Intellectual Property

By Overhauser Law Offices, LLC

South Bend, Indiana – An Indiana patent attorney for Plaintiffs Never Lost Golf, LLC of South Bend, Indiana; Michael Carnell, a domiciliary of California who resides in Berlin, Germany and who does business as The Never Lost Golf Tee Saver and The Never Lost Golf Tee Saver Mat System (“NLG”); and Teresa O’Keefe and Grant Holloway, Trustees for the N.L.G. Living Trust filed a lawsuit in the Northern District of Indiana alleging infringement of NLG’s German Patent A63B 57/100, which has been filed with the German Patent Office. Patent protection for NLG has also been sought with the U.S. Patent and Trademark Office.

Three Defendants in this litigation, Maia Steinert, Chrisoph Stephan and Ralf Menwegen, are partners and/or members of Steinert & Stephan, a German law firm. Steinert has been accused by Plaintiffs of “aggregious [sic] conduct in asserting ownership interest in the NLG German patent.” Stephan and Menwegen were accused of having been “involved in the patent process.”

Carnell contends that he retained Steinert & Stephan in 2010 to represent him in filing for a German patent for the Never Lost Golf product. He adds in his complaint that any intellectual property rights obtained by these filings were supposed to accrue to him alone. Carnell asserts that, subsequent to hiring the Steinert & Stephan and utilizing their services in pursuit of a German patent, Steinert applied for a Never Lost Golf patent with the United States Patent and Trademark Office. This filing, states Carnell, includes an assertion by Steinert that she was the sole owner of the patent rights associated with the NLG product. He states that her actions demonstrate an attempt to illegally claim rights to intellectual property that she knew was not hers, both in the United States and in Germany.

Two additional Defendants, Markus Schumann and Harribert Pamp, have been named as co-conspirators. Plaintiffs contend that they conspired with Steinert to commit fraud and perjury in support of Steinert’s assertion of ownership in NLG’s German patent.

Defendants seek equitable relief along with damages, costs and attorney fees.

September 30, 2015

Indiana Copyright Litigation: Copyright Infringement Lawsuit Removed to Federal Court

By Overhauser Law Offices, LLC

Evansville, Indiana – Responding to a complaint filed in Indiana state court by Indiana copyright attorneys, a defense lawyer filed a motion to remove the lawsuit to a federal court in the Southern District of Indiana – Evansville Division.

Plaintiff Professional Transportation, Inc. of Evansville, Indiana (“PTI”) is the former employer of Defendant Robert Warmka of Savage, Minnesota. Warmka worked for PTI from September 2012 to December 2013. PTI contends that this employment was governed in part by a trade-secrets agreement. Subsequent to leaving employment with PTI, Warmka began employment with Minnesota Coaches Inc. (“MCI”) d/b/a Crew Motion, a competitor of PTI.

PTI filed this copyright lawsuit in Vanderburgh Superior Court alleging that Warmka infringed its intellectual property by his use of Plaintiff’s copyrighted driver’s manual within MCI’s driver’s manual. PTI contends that multiple sections of PTI’s manual were reproduced nearly verbatim in MCI’s manual. PTI claims that this manual was filed with the U.S. Copyright Office “on or before 2012.” Plaintiff further contends that Defendant appropriated Plaintiff’s confidential material and trade secrets in violation of a trade secret agreement executed by both parties in 2012.

In this lawsuit, filed by Indiana copyright lawyers, the following counts are asserted:

• Count I: Indiana Trade Secret Violation
• Count II: Unfair Competition

• Count III: Copyright Infringement

Plaintiff alleges loss of business and profits and seeks injunctive relief and monetary damages.

Copyright attorneys for Warmka filed a notice of removal, stating that federal subject-matter jurisdiction was proper on the basis of both federal-question jurisdiction and diversity-of-citizenship jurisdiction.

July 28, 2015

Supreme Court Keeps Brulotte – Post-Expiration Patent Royalties are Still Unlawful Per Se

By Overhauser Law Offices, LLC

Washington, D.C. – The U.S. Supreme Court recently decided a patent-royalty lawsuit, Kimble v. Marvel Entertainment, LLC. The Court, divided 6-3, ruled against Kimble.

Stephen Kimble sued Marvel in 1997 for infringing his patent, U. S. Patent No. 5,072,856,

with its “Web Blaster,” a toy that allowed users to mimic Spider-Man’s web-slinging superpower. The litigation ended with a settlement wherein Marvel purchased Kimble’s patent for a lump sum and agreed to pay a 3% perpetual royalty on future sales.