Indiana State Law

April 9, 2014

Indiana Copyright Litigation: Richard Bell Files Another Copyright Infringement Lawsuit

Indianapolis, Indiana – Richard Bell, an Indiana copyright attorney, filed a lawsuit in the Southern District of Indiana alleging copyright infringement by numerous Defendants. The Defendants are: Diversified Vehicle Services of Marion County, Indiana; Cameron Taylor and Taylor Computer Solutions of Indianapolis, Indiana; Rhonda Williams of Indianapolis, Indiana; Forensic Solutions, Inc. of Waterford, New York; Heath Garrett of Nashville, Tennessee; CREstacom, Inc. of Fishers, Indiana; American Traveler Service Corp LLC, location unknown;
Mike Cowper of Martinsville, Indiana; Kimberly Hinds of Indianapolis, Indiana; Rensselaer Polytechnic Institute of Troy, New York; EasyStreet Realty of Indianapolis, Indiana; Drohan Management of Reston, Virginia; Metal Markets of Indianapolis, Indiana; Mattison Corporation of Indianapolis, Indiana; Industrial Heating Equipment Association of Taylor Mill, Kentucky; Junk Dawgs of Indianapolis, Indiana and WRTV of Indianapolis, Indiana. Mr. Bell is both the copyright lawyer and Plaintiff in this lawsuit.

Bell is a copyright attorney and a professional photographer. He contends that he is the owner of two copyrighted photographs of Indianapolis taken in March 2000. The photos have been registered with the U.S. Copyright Office.

Bell alleges that each Defendant, independent of each other Defendant, “created their individual website to promote and market their business” and placed the Plaintiff’s copyrighted photo on each of the Defendants’ respective websites. It is alleged that no Defendant had obtained the right to publish either photo but that each falsely represented otherwise to the world. Bell asserts that, as a result, Defendants have “realized and continue to realize profits and other benefits rightfully belonging to Plaintiff.” Each Defendant is accused of “willfully and deliberately” engaging in copyright infringement “with oppression, fraud, and malice.”

In his complaint, Bell lists the following claims:

• Count I: Copyright Infringement and Unfair Competition
• Count II: Theft

Bell asserts that he has already suffered, and is continuing to suffer, irreparable injury as a result of the alleged infringement of his copyrighted photos. Bell asks the court to declare that the Defendants’ conduct in using his photos violates his rights under Indiana law and the Copyright Act and asks the court to enjoin further infringing uses of his photos. Among other remedies, he seeks treble damages under Indiana statutory authority. He also asks for an accounting of all gains, profits and advantages derived by Defendants as a result of the alleged infringement and for the maximum allowable statutory and/or actual damages for each violation. Plaintiff also seeks reimbursement of costs and reasonable attorneys’ fees.

Practice Tip #1: The claims of this case appear calculated to trigger the “advertising injury” clause of many general business liability insurance policies. If a defendant has applicable business insurance, this may allow Mr. Bell to negotiate quicker settlements. Overhauser Law Offices, publisher of this Site, counsels clients on insurance coverage for insurance claims.

Practice Tip #2: This newest complaint initiates the latest of three ongoing cases filed by Mr. Bell asserting infringement of his photos. We have blogged about his copyright infringement litigation before. See here. The Indiana Lawyer also wrote today about Mr. Bell’s copyright infringement lawsuits. See here. The Indiana Business Journal ran a similar piece. Those articles include an interview with Paul Overhauser, Managing Partner of Overhauser Law Offices.

April 3, 2014

Indiana Trademark Litigation: Noble Roman’s Sues for Trademark Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – An Indiana trademark attorney for Noble Roman’s, Inc. of Indianapolis, Indiana filed a lawsuit in the Southern District of Indiana alleging that Sahara Sam’s Indoor Water Park, LLC of Pennsauken, New Jersey (“Sahara”) infringed its trademarks. These trademarks are: Noble Roman’s®, Trademark Registration No. 987,069; THE BETTER PIZZA PEOPLE, Trademark Registration No. 1,920,428; and a design mark, Trademark Registration No. 1,682,308. Noble Roman’s also states that it has registered the Tuscano’s® mark. In addition to trademark infringement, Noble Roman’s asserts that Sahara engaged in false designation of origin and unlawful competition. Noble Roman’s has registered its marks with the U.S. Patent and Trademark Office.

Noble Roman’s is in the business of franchising the operation of Noble Roman’s pizza franchises that feature pizza, breadsticks, and other related food items to various franchisees throughout the world. Noble Roman’s has used its trademarks, among them “Noble Roman’s” and “The Better Pizza People,” registered in 1974 and 1995, respectively, in commerce in connection with marketing, identifying, and promoting its pizza franchises.

On or about June 27, 2005, Noble Roman’s and entered into two franchise agreements. Under the terms of the agreements, Sahara became a franchisee of Noble Roman’s, licensed and authorized to sell “Noble Roman’s” and “Tuscano’s” branded food products using Noble Roman’s intellectual property assets. Noble Roman’s asserts that these agreements included terms relating to the accurate reporting of sales and timely payment of franchise fees and other fees.

Sahara is accused of failing to pay royalties as required under the agreement and of misreporting sales, among other things. Noble Roman’s contends that Sahara purposely, intentionally and knowingly misreported its sales to Noble Roman’s for the purpose of avoiding payment of franchise fees and/or royalties which were due.

Noble Roman’s also contends that, after electing not to renew the franchise agreements, Sahara violated certain post-termination provisions of the Agreements, including those which require Sahara to: (1) cease to use any Noble Roman’s proprietary products; and (2) remove from public view and display any signage or other articles containing or depicting the trademarks.

Sahara is further accused of having violated the non-competition covenants by selling, after termination of the franchise agreements, various food items “which can be utilized without knowledge gained from Noble Roman’s.”

Noble Roman’s states that Sahara’s actions were without the authorization or consent of Noble Roman’s and that they constitute trademark infringement, in violation of 15 U.S.C. § 1114(1), as well as false designation of origin in violation of 15 U.S.C. § 1125.

The complaint, filed by an Indiana trademark lawyer, lists the following:

• Count One (Trademark Infringement)
• Count One [sic] (Breach of Contract)
• Count Two (Fraud)
• Count Three (Injunctive Relief)

Noble Roman’s asks for injunctive relief, as well as judgment in its favor in amount to be proven at trial, together with interest, punitive damages, costs of collection and reasonable attorney’s fees.

Practice Tip: Noble Roman’s has been particularly aggressive in enforcing franchise agreements. Since 2007, it has also filed the following suits in the Southern District of Indiana:

February 12, 2014 – NOBLE ROMAN’S, INC. v. B & MP and LESLIE PERDRIAU

September 5, 2012 – NOBLE ROMAN’S, INC. v. VILLAGE PANTRY

March 17, 2011 – NOBLE ROMAN’S, INC. v. FINDLAY TIFFIN OIL, LLC and AYMAN MAGDADDI

January 27, 2011 – NOBLE ROMAN’S INC. et al. v. BRABHAM OIL COMPANY and BRABHAM OIL COMPANY

October 9, 2009 – NOBLE ROMAN’S, INC. v. CITY CENTER FOOD CORP., INC.

August 31, 2009 – NOBLE ROMAN’S INC. v. W.J. INTERNATIONAL GROUP, LLC

July 17, 2009 – NOBLE ROMAN’S, INC. v. MARDAN, INC.

July 8, 2009 – NOBLE ROMAN’S, INC. v. RENTON WILLIAMS

April 21, 2009 – NOBLE ROMAN’S, INC. v. RICHARD A. GOMES and RRCM FOODS, INC.

April 2, 2009 – NOBLE ROMAN’S, INC. v. KANDAKAR ALAM

February 17, 2009 – NOBLE ROMAN’S, INC. v. EXPRESS LANE, INC.

February 10, 2009 – NOBLE ROMAN’S, INC. v. JJP&L, LLC

November 6, 2008 – NOBLE ROMAN’S, INC. v. PARDIS & ASSOCIATES, INC.

October 24, 2008 – NOBLE ROMAN’S, INC. v DELTA PROPERTY MANAGEMENT LLC, ZACK BROTHERS TRUCK STOP, LLC and STANDARD PETROLEUM CORP.

October 6, 2008 – NOBLE ROMAN’S INC. v. JAY’S GAS LLC

April 9, 2008 – NOBLE ROMAN’S, INC. v. SHAHRAM RAHIMIAN

March 17, 2008 – NOBLE ROMAN’S, INC. v. MEDALLION CONVENIENCE STORES, INC.

December 20, 2007 – NOBLE ROMAN’S, INC. v. MICHAEL J. BRUNSWICK, LAURIE BRUNSWICK, and M&L RESTAURANTS, LLC

September 17, 2007 – NOBLE ROMAN’S, INC. v. THE FRENCH BAGUETTE, LLC et al.

July 26, 2007 – NOBLE ROMAN’S, INC. v. MR. RON’S, L.C.

July 19, 2007 – NOBLE ROMAN’S INC. v. BAUER BUILT, INC. et al.

March 31, 2014

Indiana Trademark Litigation: Agler Sues Westheimer Over Use of Stratotone Mark

By Overhauser Law Offices, LLC

Fort Wayne, Indiana – Indiana trademark attorneys for Darryl Agler, doing business as The Stratotone Guitar Company of Fort Wayne, Indiana, filed a lawsuit in the Northern District of Indiana alleging that Westheimer Corporation of Northbrook, Illinois infringed the trademark “STRATOTONE” (the “Stratotone mark”), Trademark Registration No. 3,986,754 which has been issued by the U.S. Patent and Trademark Office (“USPTO”). Counterfeiting, unfair competition, and false designation of origin arising under the Lanham Act, 15 U.S.C. § 1051 et seq., and the statutes and common law of the State of Indiana have also been alleged.

Agler custom manufactures guitars and sells them across the United States. Each of Agler’s guitars is hand crafted from the wood of a customer’s choosing and features vintage hardware. Agler currently accepts orders for his guitars on his website at www.stratotoneguitar.com. He also displays and sells his guitars, which sell at retail for $1,250 or more, at vintage guitar shows across the nation. Angler asserts that, since at least as early as January of 2007, his marketing and promotions in connection with his guitars have included the Stratotone Mark.

Agler claims a right to exclude others’ use of the “Stratotone” mark in connection with guitars based on, inter alia, ownership of trademark rights to the mark “Stratotone” conferred by U.S. Reg. No. 3,986,754 (“‘754 Registration”). The ‘754 Registration was issued by the USPTO in 2011 as a result of a 2006 application for the Stratotone mark in association with “musical instruments, namely, guitars.”

According to the complaint, at the National Association of Music Merchants (“NAMM”) show in 2010, Westheimer offered and sold cheaper guitars using the Stratatone mark. Agler states that he spoke to Westheimer personnel twice at this show, notifying them that Westheimer’s products were infringing the Stratotone mark. Agler alleges that he was unable to sell any of his guitars at the NAMM show that year.

Agler indicates that, since the 2010 NAMM show, Westheimer has flooded the market with lower quality, cheaper guitars that bear the Stratotone mark. These guitars retail between $199.00 and $399.00. Agler contends that Westheimer’s “Stratotone” guitars have destroyed the market for Agler’s more expensive Stratotone guitars.

On April 25, 2013, Westheimer filed a petition to cancel the ‘754 Registration (the “Cancellation Petition”) with the Trademark Trial and Appeal Board. The Cancellation Petition is currently pending.

In the complaint, filed by Indiana intellectual property lawyers for Agler, the following counts are alleged:

• Count I: Federal Unfair Competition and False Designation of Origin
• Count II: Federal Trademark Infringement
• Count III: Federal Trademark Counterfeiting
• Count IV: Common Law Unfair Competition and Trademark Infringement
• Count V: Unjust Enrichment
• Count VI: Conversion
• Count VII: Deception
• Count VIII: Indiana Crime Victim’s Relief Act

Agler asks the court for injunctive relief; an accounting of damages; the surrender by Westheimer of items featuring the Stratotone mark; damages, including treble damages; and attorney’s fees.

Practice Tip: Indiana Code §§ 35-43-4-3 and 35-43-5-3(a)(6) are criminal statutes, claimed in the complaint in conjunction with an attempt to parlay the accusation into an award for damages, costs and attorneys’ fees. The Indiana Court of Appeals has discussed “theft” and “conversion” as they pertain to takings of intellectual property in several recent cases (see, for example, here and here) and has made it clear that criminal statutes often apply differently to an unlawful taking of intellectual property.

March 13, 2014

Indiana Court of Appeals Finds Noncompetition Agreement Overly Broad and Unenforceable

By Overhauser Law Offices, LLC

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

In 1998, Smith began working for Clark’s, a company that sells and services appliances in the builder-distributor market in Indiana. In 2004, after one of Clark’s high-level managers left for a competitive position at another company, Clark’s 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’s 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 the costs and profit margins of Clark’s. On April 18, 2012, he accepted an offer of employment with Ferguson, a nearby competitor. In his new position, he solicited business from various customers of Clark’s.

Indiana attorneys for Clark’s sued to enforce the confidentiality and noncompetition provisions of the agreement entered into with Smith. The trial court concluded that the restrictive covenant that Clark’s drafted was overly broad and unreasonable, and denied Clark’s motion for a preliminary injunction. From that order, this interlocutory appeal was brought.

On appeal, Clark’s challenged the trial court’s ruling, calling it clearly erroneous. It claimed that the noncompetition agreement was not unreasonable and unenforceable. Clark’s also argued that, even if the noncompetition agreement were unreasonable and unenforceable as written, the court should apply the “blue-pencil doctrine” to make whatever modifications were necessary to render the covenant reasonable and enforceable.

The Indiana appellate court first discussed whether Clark’s had a legitimate and protectable interest, defined as “some reason why it would be unfair to allow the employee to compete with the former employer.” Indiana courts have held that “the advantageous familiarity and personal contact which employees derive from dealing with an employer’s customers are elements of an employer’s ‘good will’ and are a protectible interest which may justify a restraint.” The appellate court held that, while the trial court had not explicitly stated that it had found such a protectable interest, such a finding was implicit in its ruling. The appellate court ruled that the trial court had not erred by determining that Clark’s had established this element.

The Indiana appellate court then evaluated the reasonableness of the restrictions. Both parties agreed that the two-year limit was reasonable and valid. They disagreed, however, regarding the reasonableness of the noncompetition agreement as to the scope of activities and geographic area restricted.

The appellate court held that the one type of activities prohibited – Clark’s restrictions against contact with any of its past or prospective customers – was vague and too broad. The agreement also prohibited not merely those activities which Smith had engaged in during his tenure at Clark’s, but also prohibited him from providing any services competitive to “those offered by” Clark’s. That provision was held to be “overly broad, onerous, and an undue restriction on Smith’s economic freedom” and, thus, unenforceable.

The restrictions placed on the geographic area in which Smith could work were also evaluated. Those restrictions included working “in any state in which Gregg [Smith’s previous employer] does business, as well as working for any other entity providing services competitive to Clark’s in Marion County, any county contiguous to Marion County, any county in Indiana in which Clark’s has at least one customer, the State of Indiana, or within a fifty-mile radius of Smith’s principal office with Clark’s, which was in Castleton.” The appellate court held that it was “unquestionable that the expansive geographic scope . . . is unreasonable as written.”

Finally, the court addressed the “blue-pencil doctrine.” This doctrine allows a court to strike unreasonable restrictions in a covenant not to compete, provided that they are divisible. However, this doctrine does not extend to allow a court to create a reasonable restriction, as this would subject the parties to an agreement that they have not made.

The court held that blue pencil doctrine was inapplicable, as the terms that Clark’s proposed be stricken had been written as merely a small part of an indiscrete whole. Moreover, it held that, even if it were to strike the text that Clark’s had proposed be stricken, the restrictions would still be overly broad and in excess of what would be required to protect Clark’s legitimate business interest.

The Indiana appellate court affirmed the trial court, holding that its judgment was not clearly erroneous.

Practice Tip #1: To demonstrate the reasonableness of a noncompetition agreement, the employer must first show that it has a legitimate interest to be protected by the agreement. The employer also bears the burden of showing that the agreement is reasonable in terms of the time, activities, and geographic area restricted.

Practice Tip #2: 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.

Practice Tip #3: This is at least the second time that the Indiana Court of Appeals has heard an interlocutory appeal on this non-compete litigation. In a prior appeal, the Court of Appeals reversed the trial court, which had improperly concluded that the noncompetition agreement failed for lack of consideration. We blogged about that appeal here.

Practice Tip #4: While Appellant-Plaintiff here argued that broad drafting was permissible and simply a “good faith effort to provide itself the greatest level of protection allowed by law,” the Indiana appellate court did not agree. Instead, it called the practice “unsavory” and reminded Clark’s that “Indiana law strongly discourages employers’ attempts to draft unreasonably broad and oppressive covenants.”

February 27, 2014

James Dean, Inc.’s Indiana Trademark Infringement Litigation Against Twitter Removed to Federal Court

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Illinois and Missouri trademark attorneys for James Dean, Inc. of Indiana sued in Indiana state court alleging that Twitter, Inc. of California infringed the trademark James Dean, which has been issued by the U.S. Trademark Office by allowing the registration of the Twitter handle @JamesDean. The case was removed from the Superior Court of the County of Hamilton, Indiana to the Southern District of Indiana.

Plaintiff James Dean, Inc. filed a trademark complaint against Twitter, as well as the fictitious persons, John Doe Defendants 1-5 Company, in an Indiana state court. In the complaint, Plaintiff alleged that it is the exclusive owner of the name, likeness, voice, right of publicity and endorsement, worldwide trademarks, copyrights, and other intellectual property including but not limited to visual and aural depictions, artifacts, memorabilia, and life-story rights, and/or trade dress of the late movie star James Dean.

James Dean, Inc. further alleges that Twitter has allowed the registration and operation of a Twitter account, using the handle @JamesDean, located at https://twitter.com/JamesDean, which is purportedly in violation of Plaintiff’s rights.

In the complaint, filed by an Indiana trademark lawyer, James Dean, Inc. asserted nine causes of action against Twitter:

• Count I – Trademark Infringement Under Section 32(1) or 3(A) of the Lanham Act;
• Count II – False Endorsement Under Lanham Act § 43(A);
• Count III – Indiana State Statutory Right of Publicity;
• Count IV – Common Law Right of Publicity;
• Count V – Common Law Unfair Competition;
• Count VI – Unjust Enrichment;
• Count VII – Conversion;
• Count VIII – Deception; and
• Count IX – Indiana Crime Victims’ Act.

For relief, James Dean, Inc. sought damages, including treble damages, costs, and attorney’s fees as set out in the Indiana Right of Publicity Statute, Lanham Act and other statutes. In addition, Plaintiff seeks injunctive relief.

Twitter removed the action pursuant to 28 U.S.C. § 1331 (federal-question jurisdiction) and 28 U.S.C. § 1332 (diversity-of-citizenship jurisdiction). To support the former basis for federal jurisdiction, Twitter noted federal questions inherent in the filing of a claim under the Lanham Act. Twitter also claimed supplemental jurisdiction for the remaining claims under Indiana law.

To support the latter basis for jurisdiction in an Indiana federal court, Twitter asserted that the two prongs for diversity-of-citizenship jurisdiction were met. First, James Dean, Inc. is a citizen of Indiana, as it has alleged that it is incorporated under the laws of the State of Indiana with its principal place of business in Indiana, while Twitter claims to be a citizen of two states: Delaware and California. Second, while Twitter “strongly contests liability and does not believe Plaintiff is entitled to any relief whatsoever,” it indicated that, were liability to be found, the amount in controversy could exceed $75,000, given that James Dean, Inc. is suing for “all damages” allowed by the applicable statutes, which can include actual damages, treble damages, punitive damages, statutory damages and attorneys’ fees.

Practice Tip:

James Dean was born on February 8, 1931, in Marion, Indiana. He grew up in Fairmount, Indiana, about 60 miles northeast of Indianapolis. Dean starred in East of Eden, Rebel Without a Cause and Giant, receiving two Academy Award nominations for Best Actor.

In 1955, Dean died in an automobile accident. As a result of the nearly 60 years that have passed since his death, it is unlikely that those who follow @JamesDean believe that the tweets have been written by James Dean himself. Nonetheless, celebrity licensing agency CMG Worldwide, based out of Carmel, Indiana, is attempting to recover the James Dean Twitter account.

CMG, which also represents such celebrity images as Marilyn Monroe, Jackie Robinson and Babe Ruth, has attempted “on numerous occasions” to make Twitter take action to block and identify owners of various unauthorized accounts. Those accounts could give the impression, it says, that the users have permission from the estates of the celebrities or CMG and “result in immeasurable and irreparable damage.”

Finally, most of the James Dean trademarks that were registered by the U.S. Trademark Office have been either abandoned or cancelled. It will be interesting to see to what degree this fact influences the court, should liability be established and a calculation of damages be appropriate.

February 20, 2014

Noble Roman’s Sues Another Indiana Franchisee Alleging Trademark Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – An Indiana trademark attorney for Noble Roman’s, Inc. of Indianapolis, Indiana sued in the Southern District of Indiana alleging that B & MP, LLC (which was dissolved in 2011) and Leslie Perdriau of Apple River, Illinois (collectively, “B & MP”) infringed the trademark Noble Roman’s, Registration No. 987,069, as well as the trademark, The Better Pizza People, Registration No. 1,920,428. Noble Roman’s also lists a design mark, Registration No. 1,682,308 in its complaint. All of the marks have been registered by the U.S. Trademark Office.

Noble Roman’s is in the business of franchising the operation of Noble Roman’s pizza franchises that feature pizza, breadsticks, and other related food items to various franchisees throughout the world. Noble Roman’s has used its trademarks, among them “Noble Roman’s” and “The Better Pizza People,” registered in 1974 and 1995, respectively, in commerce in connection with marketing, identifying, and promoting its pizza franchises.

On or about March 16, 2010, Noble Roman’s and B & MP entered into two franchise agreements. Under the terms of the agreements, B & MP became a franchisee of Noble Roman’s licensed and authorized to sell “Noble Roman’s” and “Tuscano’s” branded food products using Noble Roman’s intellectual property assets. These agreements included terms relating to the accurate reporting of sales and timely payment of franchise and other fees.

B & MP is accused of failing to pay royalties as required under the agreement and of misreporting sales, among other things. Noble Roman’s contends that B & MP purposely, intentionally and knowingly misreported its sales to Noble Roman’s for the purpose of avoiding payment of franchise fees and/or royalties which were due.

Noble Roman’s also states that B & MP used the Noble Roman’s trademarks in connection with the sale of non-Noble Roman’s pizza and other menu items and that such use of the trademarks was without the authorization or consent of Noble Roman’s. Those acts were asserted to constitute trademark infringement, in violation of 15 U.S.C. § 1114(1), as well as a false designation of origin in violation of 15 U.S.C. § 1125.

Although the complaint lists two Defendants, Noble Roman’s states that Defendant B & MP was involuntarily dissolved in 2011 and that Defendant Leslie Perdriau succeeded to its obligations.

The complaint, filed by an Indiana trademark lawyer, lists the following:

• Count One (Trademark Infringement)
• Count One [sic] (Breach of Contract)
• Count Two (Fraud)

Noble Roman’s asks for judgment in its favor in amount to be proven at trial, together with interest, punitive damages, costs of collection and reasonable attorneys’ fees.

Practice Tip: Noble Roman’s has been particularly aggressive in enforcing franchise agreements. Since 2007, it has also filed the following suits in the Southern District of Indiana:

September 5, 2012 – NOBLE ROMAN’S, INC. v. VILLAGE PANTRY

March 17, 2011 – NOBLE ROMAN’S, INC. v. FINDLAY TIFFIN OIL, LLC and AYMAN MAGDADDI

January 27, 2011 – NOBLE ROMAN’S INC. et al. v. BRABHAM OIL COMPANY and BRABHAM OIL COMPANY

October 9, 2009 – NOBLE ROMAN’S, INC. v. CITY CENTER FOOD CORP., INC.

August 31, 2009 – NOBLE ROMAN’S INC. v. W.J. INTERNATIONAL GROUP, LLC

July 17, 2009 – NOBLE ROMAN’S, INC. v. MARDAN, INC.

July 8, 2009 – NOBLE ROMAN’S, INC. v. RENTON WILLIAMS

April 21, 2009 – NOBLE ROMAN’S, INC. v. RICHARD A. GOMES and RRCM FOODS, INC.

April 2, 2009 – NOBLE ROMAN’S, INC. v. KANDAKAR ALAM

February 17, 2009 – NOBLE ROMAN’S, INC. v. EXPRESS LANE, INC.

February 10, 2009 – NOBLE ROMAN’S, INC. v. JJP&L, LLC

November 6, 2008 – NOBLE ROMAN’S, INC. v. PARDIS & ASSOCIATES, INC.

October 24, 2008 – NOBLE ROMAN’S, INC. v DELTA PROPERTY MANAGEMENT LLC, ZACK BROTHERS TRUCK STOP, LLC and STANDARD PETROLEUM CORP.

October 6, 2008 – NOBLE ROMAN’S INC. v. JAY’S GAS LLC

April 9, 2008 – NOBLE ROMAN’S, INC. v. SHAHRAM RAHIMIAN

March 17, 2008 – NOBLE ROMAN’S, INC. v. MEDALLION CONVENIENCE STORES, INC.

December 20, 2007 – NOBLE ROMAN’S, INC. v. MICHAEL J. BRUNSWICK, LAURIE BRUNSWICK, and M&L RESTAURANTS, LLC

September 17, 2007 – NOBLE ROMAN’S, INC. v. THE FRENCH BAGUETTE, LLC et al.

July 26, 2007 – NOBLE ROMAN’S, INC. v. MR. RON’S, L.C.

July 19, 2007 – NOBLE ROMAN’S INC. v. BAUER BUILT, INC. et al.

February 10, 2014

Swag Merchandising and Musical Group Devo Sue for Trademark Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – An Indiana trademark attorney for Swag Merchandising, Inc. and Devo Inc., both of California, sued in Hamilton Superior Court alleging that Your Fantasy Warehouse, Inc. d/b/a T.V. Store Online and Fred Hajjar, both of Commerce Township, Michigan, infringed Devo’s Trademarks, Registration Nos. 3161662 and 3167516, which have been registered by the U.S. Trademark Office. The case has been removed from Indiana state court to the Southern District of Indiana.

Swag claims that it owns the exclusive right to license the various trademarks, copyrights and individual and collective rights of publicity of the musical group Devo. The group is best known for the song “Whip It,” which hit number 14 on the Billboard chart in 1980. Swag indicates that it licenses the Devo intellectual property to third parties around the globe.

T.V. Store Online is in the business of manufacturing, marketing and distributing apparel and memorabilia featuring classic and current television programming, movies and/or music. T.V. Store Online and Hajjar have been accused of manufacturing, producing, marketing, advertising and/or retailing a product known as “Energy Dome Hats.” Plaintiffs assert that these Energy Dome Hats are commonly associated with Devo but have not been licensed by Plaintiffs to Defendants. Plaintiffs further claim that consumers coming into contact with Defendants’ product would “immediately recognize the same as being associated with, sponsored by and/or endorsed by” the ’80s group.

In the complaint, filed by an Indiana trademark attorney, Plaintiffs assert the following:

• I: Violation of 15 U.S.C. §1125(a) of the Lanham Act
• II: Trademark Infringement – 15 U.S.C. §1114 and Common Law
• III: Counterfeiting
• IV: Dilution – 15 U.S.C. §1125(c) and New York General Business Law §360-1
• V: Common Law Unfair Competition
• VI: Statutory Right of Publicity [NB: under Indiana law]
• VII: Right of Publicity Infringement Under California Civil Code §3344
• VIII: Common Law Right of Publicity
• IX: Conversion [NB: under Indiana law]
• X: Deception [NB: under Indiana law]
• XI: Indiana Crime Victims Act

Plaintiffs ask for an injunction; the surrender of infringing materials; damages, including treble damages; costs and fees. An Indiana intellectual property lawyer for Defendants removed the case to federal court, although he noted that the removal was not a concession that the Southern District of Indiana was the proper venue for the California Plaintiffs or the Michigan Defendants.

Practice Tip:

This is at least the third case filed by Theodore Minch about which we have blogged. In at least two prior cases, LeeWay Media Group, LLC v. Laurence Joachim et al. and Leon Isaac Kennedy v. GoDaddy et al., Mr. Minch has filed in an Indiana court despite none of the parties having any connection to Indiana.

It can be surmised that perhaps the choice of Indiana as a forum might have been driven by an attempt to increase damages. I.C. §§ 35-43-4-3 and 35-43-5-3(a)(6) are criminal statutes, claimed in the complaint in conjunction with an attempt to parlay the accusation into an award for damages, costs and attorneys’ fees. The Indiana Court of Appeals has discussed “theft” and “conversion” as they pertain to takings of intellectual property in several recent cases (see, for example, here and here) and has made it clear that criminal statutes often apply differently to an unlawful taking of intellectual property.

February 3, 2014

Indiana Court of Appeals Rules in Favor of Resident’s Daughter in Nursing Facility Dispute

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Alexis Hutchison (“Hutchison”) (pictured right) appealed a small claims court (“trial court”) judgment in favor of Trilogy Health Services, LLC, d/b/a Springhurst Health Campus (“Springhurst”), on Springhurst’s claim against Hutchison and her now-deceased mother, Martha Farber (“Farber”), for payment of services provided to Farber while she was a resident at Springhurst. The Indiana Court of Appeals reversed.

For a number of years, Farber was ill with cancer, requiring various trips to, and stays at, hospitals. After one of her hospital visits, and finding that she was in need of constant care, she became a resident at Springhurst, a skilled nursing facility.

When Farber was admitted to Springhurst, Hutchison signed Springhurst’s Move-In Agreement (“Agreement”) as a “Responsible Party/Agent.” This Agreement stated that, to the extent that Hutchison was authorized to “control[] or access[]” her mother’s assets, she agreed to direct her mother’s income and resources towards any financial obligations which Farber had to Springhurst. Springhurst later contended that Farber and Hutchison, as Farber’s Responsible Party/Agent, owed $1,716.90 for services rendered to Farber. Farber disputed all but a small portion of the charges and Springhurst filed suit against Farber and Hutchinson.

A trial was held. During the trial, Hutchison testified that she was not Farber’s power of attorney and that she had “no authority to use [her] mother’s income for anything.” Hutchison indicated that the only thing she could have done was point out to her mother that a bill was owed. When Hutchison cross examined Dionne Fields (“Fields”), Springhurst’s business office manager, Fields admitted that Springhurst had no documents indicating that Hutchison had any authority over her mother’s financial affairs.

Hutchison also called as a witness her husband, David Hutchison (“David”), who was present when Hutchison signed the Agreement. David testified that Hutchison had asked if signing the Agreement would make her personally financially responsible for her mother’s stay at the nursing facility. The Springhurst representative, he said, had answered with “an emphatic no.”

The trial court found the evidence – including the language of the contract, the assurances of Springhurst that Hutchison would not be held personally liable and the uncontroverted testimony that Hutchison had no power of attorney over her mother – to be unpersuasive. It rendered a general judgment in favor of Springhurst stating that “the court found the plaintiff proved the defendant liable pursuant to contract and Indiana case law for the sum of $2,610.87” but declined to specify further facts or law in support of the judgment.

Hutchison, again acting as her own attorney, appealed this ruling and the Indiana Court of Appeals held in her favor. The appellate court first cited federal limitations that have been enacted regarding the notion of imposing upon one family member financial responsibility for another family member’s care. For example, under 42 U.S.C. §§1396r(c)(5)(A)(ii) and 1395i-3(c)(5)(A)(ii), a nursing home certified as eligible for Medicare or Medicaid reimbursement “must not require a third party guarantee of payment to the facility as a condition of admission . . . to, or continued stay in, the facility.” The Indiana Administrative Code provides a similar restriction in 410 Ind. Admin. Code 16.2-3.1-16.5.

The appellate court then acknowledged that resident rights activists echoed Hutchison’s argument that an agreement to assume the status of a “responsible party,” and the personal financial liability which might accompany that, might be inconsistent with federal law and inherently illegal. The court, however, declined to decide this issue, which was apparently one of first impression in Indiana courts.

The court also declined to address the testimony that Springhurst had assured Hutchison that she would not incur personal financial liability by signing the Agreement.

Instead, the court found the provisions of the Agreement itself, in conjunction with undisputed evidence, to be dispositive. The Agreement stated that Farber “may designate” a person to act on her behalf as a Responsible Party/Agent and that, if such a designation was to be made, “the Resident shall provide the Facility with a copy of a written agreement that authorizes such individual to manage, use, control or access the Resident’s income, financial account(s) or other resources” (emphasis added by the court). It was undisputed that neither Farber nor anyone else had provided Springhurst with any such document; indeed, the unrefuted evidence had been that Springhurst did not possess any such document.

The court noted that Hutchison’s responsibilities, then, were at most “to pay the Facility the full amount of the Resident’s income and resources that the Responsible Party/Agent controls or accesses” (emphasis added by the court). As it was undisputed that Hutchison possessed neither control nor access to Farber’s income and resources, the appellate court concluded that the trial court had clearly erred. It reversed and remanded the matter with instructions to the trial court to enter judgment in favor of Hutchison.

Practice Tip #1: Cases tried before the bench in small claims court are reviewed for clear error and appellate courts are particularly deferential to the trial court in small claims actions. The appellate court, when reviewing the case, will not reweigh the evidence or determine the credibility of witnesses but will consider only the evidence that supports the judgment and the reasonable inferences to be drawn therefrom. Moreover, when a trial court’s judgment is rendered as a “general judgment,” as was the case here, that judgment will be affirmed upon any legal theory consistent with the evidence. Thus, it is very important to put on one’s best possible case to the trial court, as substantial deference is given to the trial court’s findings.

Practice Tip #2: While this case was not an Indiana intellectual property case, we include it in the Indiana Intellectual Property Law Blog to congratulate Alexis Hutchison, a valued and talented member of the Overhauser Law Offices team, on her well-deserved success in litigating this matter.

January 15, 2014

Indiana Tax Court Shields Orbitz from Disclosure of Trade Secrets

By Overhauser Law Offices, LLC

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

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

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

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

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

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

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

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

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

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

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

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

1. it is information;

2. that derives independent economic value;

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

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

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

Practice Tip:

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

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

December 11, 2013

Project Management Academy Sues Former Instructor for Misappropriation of Trade Secrets

By Overhauser Law Offices, LLC

Indianapolis, Indiana – eCity Market, Inc. d/b/a Project Management Academy (“PMA”) of Lafayette, Indiana has sued Vaughn Scott Burch (“Burch”) and Graywood Consulting Group, Inc. d/b/a Graywood Training Solutions of Leesburg, Virginia (collectively, “Graywood”) alleging infringement of its Project Management Professional examination and certification training. This suit was initially filed in Delaware County Circuit Court No. 4 but was removed to the Southern District of Indiana.

PMA offers preparation courses for the Project Management Institute’s Project Management Professional (“PMP”) examination and certification process. PMA states that Burch was one of its most-trusted PMP course instructors in the Washington, D.C. area and that, in connection with that position, PMA provided him with access to its proprietary manner of conducting its PMP-examination preparation courses. Moreover, PMA claims that it commissioned Burch and Graywood, Burch’s company, to draft and prepare as a “work for hire” certain training modules that would be for PMA’s exclusive use.

PMA alleges that Burch and Graywood are now teaching PMP courses that are in direct competition with PMA. It also contends that Defendants have stolen PMA’s confidential, proprietary and copyrighted materials to further their own course offerings. PMA further indicates that Defendants are violating the non-competition covenants by reproducing PMA’s copyrighted materials and are passing them off as their own. Finally, PMA contends that Defendants are attempting to engage in unfair competition with PMA by publishing student testimonials as if they were from Defendants’ students when, PMA states, the testimonials were actually given by the students of PMA.

An intellectual property lawyer for PMA filed a complaint alleging the following:

• Count I – Breach of Contract
• Count II – Breach of Duty of Loyalty
• Count III – Misappropriation of Trade Secrets
• Count IV – Theft/Conversion
• Count V – Tortious Interference with Prospective Business Relationship and Advantage
• Count VI – Lanham Act Violations
• Count VII – Unfair Competition

PMA asks for preliminary and permanent injunctions; an order requiring the return of all PMA materials; judgment in favor of PMA on the seven counts listed; damages, including treble and punitive damages; attorney’s fees and costs; and interest.

Practice Tip: There has also been a growing trend, perhaps fueled in part by states’ difficulties in paying increasing unemployment benefits, to limit via legislation the enforceability of non-compete agreements. Indiana considers non-compete agreements to be in restraint of trade and, thus, construes them narrowly. Among the states that have considered such limitations are Maryland, New Jersey, Minnesota, Massachusetts and Virginia. However, even in those cases where a non-compete agreement is found to be unenforceable, such a finding will not prevent a party from suing to protect its other rights, such as the intellectual property rights granted under copyright law.