New Litigation

September 16, 2013

CleanTech Sues Aemetis for Infringing Patented Corn Oil Extraction Method

Indianapolis, Indiana — Patent lawyers for GS CleanTech Corp. of Alpharetta, Georgia (“CleanTech”) filed a patent infringement suit in the United States District Court for the Eastern District of California — Fresno Division alleging that Aemetis, Inc. and Aemetis Advanced Fuels Keyes, Inc., (collectively, “Aemetis”), both of Cupertino, California, infringed CleanTech’s METHOD OF PROCESSING ETHANOL BYPRODUCTS AND RELATED SUBSYSTEMS, Patent No. 7,601,858, (the “‘858 patent”) which has 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 Eastern District of California, subsidiary GS CleanTech Corp. is the sole Plaintiff. Patent attorneys for CleanTech assert only one count in the complaint: infringement of the ‘858 patent. CleanTech asks the court for preliminary and permanent injunctions prohibiting further infringement of the ‘858 patent; 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 ‘858 patent 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 and 285.

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.

September 13, 2013

Steak n Shake Sues for Trademark Infringement

By Overhauser Law Offices, LLC

Denver, Colorado — Intellectual property lawyers for Steak n Shake Enterprises, Inc. and Steak n Shake, LLC of Indianapolis, Indiana (collectively “Steak n Shake”) sued in the United States District Court for the District of Colorado alleging that Globex Company, LLC; Springfield Downs, LLC; Christopher Baerns; Larry Baerns; Kathryn Baerns and Control, LLC, all of Colorado, are infringing the “Steak n Shake” marks, which have been registered by the U.S. Trademark Office.

Non-party Steak n Shake Operations, Inc., Steak n Shake Enterprises’ parent company, has continuously operated Steak n Shake restaurants specializing in burgers and milkshakes since 1934. There are currently 415 company-owned Steak n Shake restaurants in 15 states across the country. In addition, Steak n Shake Enterprises grants franchises to establish and operate Steak n Shake restaurants pursuant to written franchise agreements with Steak n Shake Enterprises, and written license agreements with Steak n Shake, LLC. There are currently 100 franchised Steak n Shake restaurants operating in 23 states, including Colorado. Steak n Shake asserts that the Steak n Shake trademarks, and the products and services offered in association with those marks, have been extensively promoted throughout the United States for many years.

This action against Defendants arose subsequent to the termination of franchise and license agreements between Plaintiffs Steak n Shake Enterprises, Inc., as franchisor, and Steak n Shake, LLC, as licensor, and Defendants as franchisees, licensees and/or guarantors. Steak n Shake contends that Defendants materially breached their obligations under the franchise and license agreements and failed to cure such breaches. As a result, Steak n Shake terminated the agreements.

Steak n Shake alleges that, notwithstanding the termination of the franchise and license agreements, Defendants continue to use the Steak n Shake name and marks in connection with the operation of competitive restaurants at the same locations as their former franchised Steak n Shake restaurants, and to hold their restaurants out to the public as authentic Steak n Shake restaurants.

In the complaint, trademark attorneys for Steak n Shake assert the following:

· Count I – Trademark Infringement

· Count II – Unfair Competition

· Count III – Breach of Contract – Specific Performance

· Count IV – Breach of Contract – Damages

· Count V – Breach of Guaranty – Damages

Steak n Shake seeks the following relief against Defendants, jointly and severally: preliminary and permanent injunctive relief enjoining Defendants’ trademark infringement and unfair competition, and ordering Defendants to perform their post-termination obligations under their franchise and license agreements and area development agreement, including their noncompetition covenants; recovery of the amounts owed to them by Defendants, including the damages each has sustained by reason of Defendants’ breaches and the resulting termination of the franchise and license agreements and area development agreement; and an award of the attorneys’ fees and costs incurred by Steak n Shake.

Practice Tip: Franchise agreements typically require the franchisee to cease using all of the franchise marks, as well as return all items bearing the franchise marks, in the event the franchise agreement is terminated. Failure to comply promptly with these provisions can lead to liability for trademark infringement, among other claims.

September 12, 2013

80/20 Sues “John Doe” for Trademark Infringement and Passing Off

By Overhauser Law Offices, LLC

Fort Wayne, Indiana — Trademark lawyers for 80/20, Inc. of Columbia City, Indiana filed a trademark infringement suit in the Northern District of Indiana alleging John Doe d/b/a TNutz of Champlain, New York infringed the trademark “80/20”, Trademark Registration No. 2,699,302, which has been registered with the U.S. Trademark Office.

80/20 is a manufacturer of T-slotted aluminum extrusion products and accessories. It sells to customers through a distribution network and an online “garage sale.” It asserts that it has marketed products and services under the trademark “80/20” since at least 1990. TNutz does business via its own website and an eBay store.

TNutz is accused of unfairly competing with 80/20 by, among other things, falsely representing that some of the products that it offers for sale are genuine 80/20 products when, according to 80/20, they are not. 80/20 indicates that it has no affiliation with TNutz.

The complaint also states that TNutz represents its own goods as 80/20 goods with the intention of causing confusion among, and deceiving, consumers who seek to purchase genuine 80/20 parts from or through 80/20. It also contends that TNutz has purposely hidden its true identity and physical location from consumers and competitors, asserting that the businesses listed as contacts for both TNutz’s website and its physical address are unrelated third parties.

80/20 indicates that it sent a cease-and-desist letter to TNutz on May 10, 2013 demanding that TNutz cease infringement and compensate 80/20 for the damages caused by the allegedly infringing conduct. 80/20 apparently received no response to its demands.

The complaint lists the following causes of action:

· Count I: Trademark Infringement

· Count II: Lanham Act Violation — Passing Off

Trademark lawyers for 80/20 ask the court for preliminary and permanent injunctions prohibiting infringement; an award of actual damages and profits by TNutz attributable to infringement of 80/20’s trademarks and/or statutory damages; an award of reasonable attorneys’ fees, upon a finding that this is an exceptional case; and the destruction of all materials in TNutz’s control bearing the “80/20” mark.

Practice Tip:

If a defendant’s identity is not clear from the evidence available when a complaint is filed, a “John Doe” designation is typically used to represent that unidentified defendant. After filing such a complaint, the plaintiff may then ask the court to use its authority to subpoena various third parties, such as internet service providers, to disclose the identity of the Doe defendant(s). Here, presumably, the plaintiff will subpoena to eBay to discover the identity of “John Doe.”

Although trademark lawsuits with a “John Doe” defendant are a relative rarity, this is the second one we have blogged about this week. Sometimes, as was the case in the other recent trademark complaint with a “John Doe” defendant, revealing the identity of the unknown defendant is largely procedural. In other cases, however, Doe defendants are highly motivated to preserve their anonymity, as they do not want to be associated with the embarrassing allegations in the complaint. See, e.g., one Doe defendant’s request to quash or modify a subpoena in a copyright case which involved the alleged illegal downloading of adult content.

September 6, 2013

Texas Roadhouse Sues Multiple Restaurants Operating as “Texas Corral” or “Amarillo Roadhouse”

By Overhauser Law Offices, LLC

Grand Rapids, Michigan — Trademark lawyers for Texas Roadhouse, Inc. and Texas Roadhouse Delaware LLC, both of Louisville, Kentucky (collectively, “Texas Roadhouse”) sued for trademark infringement in the Western District of Michigan alleging that the Defendants, including those doing business as multiple Texas Corral restaurants located in Indiana (collectively “Texas Corral”), as well as one Amarillo Roadhouse restaurant, also located in Indiana, infringed the service mark TEXAS ROADHOUSE, Trademark Registration Nos. 1,833,533; 2,231,309; and 2,250,966, which have been registered by the U.S. Trademark Office.

Texas Roadhouse operates a Texas-themed restaurant chain. The first Texas Roadhouse restaurant opened in Clarksville, Indiana in 1993. As of March 2013, there were 397 Texas Roadhouse restaurants in 47 states and three countries.

Texas Roadhouse contends that each of the restaurants is required to comply with strict exterior and interior design requirements so that the look and feel is substantially identical across all Texas Roadhouse locations. It lists three U.S. Service Mark Registrations that include the mark “Texas Roadhouse” and asserts that each of them is incontestable. Texas Roadhouse also claims ownership of various unregistered marks that include the word “Texas” and “Roadhouse” as well as copyright protection, including a U.S. Copyright registration, of its marquee. Finally, Texas Roadhouse claims intellectual-property rights in the trade dress of its restaurants, including the look of the exterior design of the building, the interior décor, the music and the menu.

Texas Corral, against which Texas Roadhouse filed this complaint, also operates casual, western-themed, family restaurants. It owns and operates nine restaurant locations doing business under the name “Texas Corral.” A total of ten locations are at issue in this lawsuit. Six Indiana cities have “Texas Corral” restaurants: Highland, Merrillville, Portage, Michigan City, Martinsville and Shelbyville. Texas Corral also purportedly owns and operates a location that does business as “Amarillo Roadhouse” in Indiana, which is also at issue in this trademark-infringement lawsuit. In addition, three other Texas Corral restaurants have been listed in the complaint: two in Michigan and one in Illinois.

Also listed in the complaint are Paul Switzer, asserted to be the franchisor/licensor of Texas Corral restaurants and Victor Spina, asserted to be a franchisee/licensee. “John Doe Corp.,” a fictitious name intended to represent entities or individuals whose actual identity is not currently known to Texas Roadhouse, is also listed as a Defendant.

In the complaint, trademark attorneys for Texas Roadhouse assert that Texas Corral and Amarillo Roadhouse routinely use trade dress, trademarks, service marks, trade names, designs or logos that are confusingly similar to or copies of intellectual property owned by Texas Roadhouse. This purportedly infringing use is asserted to be visible in signage, print and electronic promotional materials, menus, décor, building design and websites.

Texas Roadhouse’s complaint against Texas Corral and Amarillo Roadhouse lists the following:

· Count I: Trade Dress Infringement

· Count II: Federal Trademark Infringement

· Count III: Trademark Infringement Under Mich. Comp. Laws § 429.42

· Count IV: Trademark Infringement Under Ind. Code § 24-2-1-13

· Count V: Trademark Infringement Under Common Law

· Count VI: Copyright Infringement Under 17 U.S.C. § 101 et seq.

· Count VII: Unfair Competition Under Michigan and Indiana Common Law

Texas Roadhouse asks for a judgment that Texas Roadhouse owns enforceable rights in the Texas Roadhouse intellectual property and that all registrations for the Texas Roadhouse intellectual property are valid; a judgment that the Defendants have been and are directly or indirectly infringing the Texas Roadhouse intellectual property; a judgment that the Defendants have been and are engaging in unfair competition by their unauthorized use of the Texas Roadhouse intellectual property; a judgment that Defendants acted deliberately, willfully, intentionally or with malicious intent; an injunction against Defendants prohibiting infringement; damages, including treble damages; a judgment that this case is exceptional and that the Defendants be ordered to pay all of Texas Roadhouse’s attorney fees associated with this action pursuant to 15 U.S.C. § 1117 and 17 U.S.C. § 505; and a judgment that the defendants be ordered to pay all costs and expenses incurred by Texas Roadhouse in this action.

Practice Tip:

The U.S. Supreme Court has addressed the requirements for trade dress protection in a similar context. Two Pesos, Inc. v. Taco Cabana, Inc., 505 U.S. 763 (1992). At issue in Two Pesos was similar restaurant décor. Taco Cabana had sued rival Two Pesos for copying the look of its restaurant, described as “a festive eating atmosphere having interior dining and patio areas decorated with artifacts, bright colors, paintings and murals. The patio includes interior and exterior areas with the interior patio capable of being sealed off from the outside patio by overhead garage doors. The stepped exterior of the building is a festive and vivid color scheme using top border paint and neon stripes. Bright awnings and umbrellas continue the theme.” The lawsuit alleged that Two Pesos had imitated this scheme and had thereby infringed on Taco Cabana’s trade dress. Among the issues considered was whether trade dress which was inherently distinctive must also be shown to have secondary meaning to be granted protection under the Lanham Act. The Supreme Court held that trade dress which is inherently distinctive is protectable under § 43(a) of the Lanham Act without a showing that it has acquired secondary meaning, since such trade dress itself is capable of identifying products or services as coming from a specific source.

Also at issue in this case, among other matters, will be the eligibility of the words “Texas” and “Roadhouse” for protection under federal and Indiana intellectual-property laws. Under the Lanham Act, a federal law, the holder of a mark may ask the United States Patent and Trademark Office to register the mark on the principal register. 15 U.S.C.A. § 1051, et seq. Marks that are “primarily descriptive” and “primarily geographically descriptive” of the goods or services with which they are associated are not eligible for registration on the principal register unless they have “become distinctive of the applicant’s goods in commerce.” 15 U.S.C.A. § 1052(e), (f). Thus, registration of a descriptive mark on the principal register requires a showing of secondary meaning.

Although the Lanham Act protects both registered and unregistered marks, registration is desirable because it constitutes prima facie evidence of the mark’s validity. See 15 U.S.C.A. §§ 1057(b), 1115(a). Thus, federal registration of a mark “‘entitles the plaintiff to a presumption that its registered trademark is not merely descriptive or generic, or, if merely descriptive, is accorded secondary meaning.'” The plaintiff bears the burden, however, of establishing that an unregistered mark is entitled to protection.

The Indiana Trademark Act is similar, and in some respects identical, to the Lanham Act. Although Indiana’s body of trademark law is relatively undeveloped, the General Assembly has specified that the Indiana Trademark Act “is intended to provide a system of state trademark registration and protection that is consistent with the federal system of trademark registration and protection under the Trademark Act of 1946.” Ind. Code Ann. § 24-2-1-0.5. Moreover, “[a] judicial or an administrative interpretation of a provision of the federal Trademark Act may be considered as persuasive authority in construing a provision of the Indiana Trademark Act.

The Indiana Trademark Act’s definitions of “trademark” and “service mark” track the Lanham Act’s definitions of those terms nearly verbatim. See I.C. § 24-2-1-2(8), (9). Like the Lanham Act, the Indiana Trademark Act does not adversely affect common-law trademark rights. See I.C. § 24-2-1-15. Registration of a trademark or service mark with the office of the Indiana Secretary of State provides a registrant with a remedy for the infringement thereof under the Indiana Trademark Act. I.C. § 24-2-1-14(a). Like the Lanham Act, the Indiana Trademark Act prohibits the registration of marks that are “primarily geographically descriptive or deceptively geographically misdescriptive of the goods or services[.]” I.C. § 24-2-1-3. This provision does not, however, prevent the registration of a mark that is used in Indiana by the applicant and has become distinctive of the applicant’s goods or services. In other words, a geographically descriptive mark may be registered under the Indiana Trademark Act if it has acquired secondary meaning.
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August 30, 2013

NIBCO Sues for Declaration of Non-Infringement of Valvulas Arco Patents

By Overhauser Law Offices, LLC

South Bend, Indiana – NIBCO, Inc. of Elkhart, Indiana has sued Valvulas Arco, S.A. (“Arco”) of Valencia, Spain in the Northern District of Indiana asking for a declaratory judgment that it has not violated Arco’s patents, U.S. Design Patent Nos. 429,518; 429,519; 429,520; 438,595; and 479,307.

Arco and NIBCO both manufacture shut-off valves. From about 2002 to 2008, Arco manufactured and sold to NIBCO shut-off valves of the type involved in this dispute. Around 2008, NIBCO discontinued purchasing valves from Arco. Currently, NIBCO manufactures shut-off valves for its own use and for sale.

In letters dated April 22, 2013 and August 16, 2013, Arco purportedly asserted that NIBCO infringes the Arco valves (the “patents-in-suit”). As a result of Arco’s claims of infringement in those letters, NIBCO asserts that there is now an actual controversy between it and Arco regarding the alleged infringement and validity of the patents-in-suit; NIBCO seeks a resolution under the Declaratory Judgment Act.

NIBCO states that Arco has never fixed upon its shut-off valves notice of, nor was there ever any mention of any of, any of the patents-in-suit. It further claims that most, if not all, of the features shown in the claims are functional. To the extent that any purely ornamental features do exist, it contends that those ornamental features of NIBCO’s products would not appear substantially similar to an ordinary observer. Consequently, NIBCO asserts that its products do not infringe, either literally or under the doctrine of equivalents. Finally, NIBCO denies inducing others to infringe any of the patents-in-suit.

NIBCO asks that this be found to be an exceptional case and asks that attorney’s fees be awarded pursuant to such a finding. In its complaint, patent attorneys for NIBCO ask the court for:

Count I: Declaratory Judgment of Non-Infringement
Count II: Declaratory Judgment of Invalidity of the Patents-In-Suit

Practice Tip: In MedImmune v. Genentech, 549 U.S. 118 (2007), the U.S. Supreme Court revised the Federal Circuit’s test for ripeness under the Declaratory Judgment Act, which had required a reasonable apprehension of suit in order to establish jurisdiction. The Court broadened the scope of declaratory judgment jurisdiction, holding that the totality of the circumstances should be evaluated in determining the existence of “a substantial controversy, between parties having adverse legal interests, of sufficient immediacy and reality to warrant relief.”

In this case, it is unclear whether the complaint adequately alleges, under the totality of the circumstances, a controversy of sufficient immediacy to warrant jurisdiction under the Declaratory Judgment Act.

August 19, 2013

Lifetime Industries Sues Trim-Lok for Patent Infringement

By Overhauser Law Offices, LLC

South Bend, Indiana — Lifetime Industries, Inc. (“LTI”) of Elkhart, Indiana has sued Trim-Lok, Inc. of Buena Park, California in the Northern District of Indiana alleging patent infringement of its “TWO-PART SEAL FOR A SLIDE-OUT ROOM,” Patent No. 6,966,590 (the “‘590 patent”), which has been issued by the U.S. Patent Office.

Plaintiff LTI’s claims are based on the allegedly unauthorized, infringing manufacture, use, importation, sale and/or offer for sale by Defendant Trim-Lok of its seal products including, for example, the two-part seal for a slide-out room product which is mountable to mobile living quarters. LTI contends that these products include a mounting portion and a separate bulb portion that is slidably connected to the mounting portion.

LTI claims that Trim-Lok’s actions infringe one or more claims of the ‘590 patent under the intellectual-property laws of the United States. It further alleges that Trim-Lok has induced others, including its distributors, sales representatives, resellers, dealers and customers, to infringe at least claim 1 of the ‘590 patent by making, using, offering for sale and/or selling the allegedly infringing products.

LTI also asserts that Trim-Lok has known about the ‘590 patent since it was issued. Finally, LTI states in its complaint that, on July 15, 2013, it gave actual notice to Trim-Lok of its belief that Trim-Lok was infringing the ‘590 patent. Plaintiff LTI concludes that, consequently, Trim-Lok acted despite an objectively high likelihood that its actions constituted infringement of a valid patent and/or that it knew or should have known that its actions demonstrated infringement of a valid patent. Accordingly, LTI accuses Trim-Lok’s actions, from at least July 15, 2013, of constituting willful infringement of the ‘590 patent.

In the complaint, filed by patent lawyers for LTI, a single claim of patent infringement, specifically “Infringement of the ‘590 Patent,” is made. LTI asks the court for judgments that:

· the ‘590 patent is directly infringed by Defendant;

· the ‘590 patent is indirectly infringed by Defendant;

· Defendant’s infringement of the ‘590 patent has been willful;

· Defendant be preliminarily and permanently enjoined from manufacturing, using, selling and offering to sell the infringing products in the United States prior to the expiration of the ‘590 patent;

· Plaintiff be awarded damages adequate to compensate it for Defendant’s infringement of the ‘590 patent including lost profits, but in an amount no less than a reasonable royalty, and that such damages be trebled according to 35 U.S.C. § 284; and

· this case is exceptional within the meaning of 35 U.S.C. § 285, and that all costs and expenses of this action, including reasonable attorneys’ fees, be awarded to Plaintiff.

Practice Tip: A patent holder has the right to exclude others in the United States from using, selling, or attempting to sell the patented invention. See 35 U.S.C. § 154(a)(1). A patent has two chief parts. First, it contains a specification describing the invention in such full, clear, concise, and exact terms as to enable any person skilled in the art to make and use the same. Second, a patent includes one or more “claims,” which particularly point out and distinctly claim the subject matter which the applicant regards as his invention. The claim defines the scope of a patent grant.

August 15, 2013

Consumer Health Information Sues Amylin and Eli Lilly for Copyright Infringement of Patient Education Materials

By Overhauser Law Offices, LLC

Indianapolis, Indiana — Copyright lawyers for Consumer Health Information Corp. (“CHIC”) of Virginia sued Amylin Pharmaceuticals, Inc. and Amylin Pharmaceuticals, LLC (collectively, “Amylin”), both of Los Angeles, California and Eli Lilly & Co. (“Lilly”) of Indianapolis, Indiana (collectively, “Defendants”) alleging copyright infringement of works that CHIC created for Defendants’ use.

CHIC is an entity with expertise in patient engagement and patient-adherence strategies, health literacy and patient education program development for prescription drugs, over-the-counter products and medical devices.

Amylin and Lilly are primarily engaged in the research, development, manufacture, marketing and sale of pharmaceutical medicines and devices. In 2005, as part of a joint venture, they introduced the pharmaceutical drug Byetta to the marketplace. Byetta is an injectable prescription medicine that may improve blood-sugar control in adults with type 2 diabetes mellitus. As part of this joint venture, CHIC asserts that Amylin and Lilly agreed to share in the costs incurred and profits derived from Byetta.

In its copyright complaint, CHIC’s intellectual-property counsel states that, after the launch of Byetta, Defendants experienced poor sales as a result of poor patient compliance. CHIC asserts that patients had a difficult time understanding the materials that came with their medication and, thus, had a difficult time administering the drug properly. Many patients stopped taking Byetta because of these difficulties. As a result, patients stopped re-filling their Byetta prescriptions and sales of Byetta were poor.

CHIC contends that, in November 2005, Amylin and Lilly contacted CHIC to develop a strategy to improve the sales of Byetta by improving patients’ understanding of how to use the medication and by motivating patients to stay in treatment. A contract for the work was proposed by CHIC but not immediately approved by Defendants. Amylin and Lilly provided additional related projects to CHIC between December 2005 and mid-March 2006 and CHIC indicates in its complaint that it completed these projects.

CHIC asserts that, by mid-March 2006, it still had not been paid. It threatened to stop work until its proposal was approved and payment for all past work on the patient-education project was received. In response, Amylin and Lilly partially approved CHIC’s proposal. They, however, apparently demanded that a different version be signed and insisted that CHIC agree to Defendants’ terms, as outlined in their Master Service Agreement (“MSA”), regarding the assignment of copyrights.

The complaint states that, by this time, CHIC had expended significant time and expenses in furtherance of the Byetta project. CHIC claims that it was in jeopardy of imminent financial ruin if Amylin and Lilly did not pay for the services already rendered and that Defendants refused payment unless and until CHIC signed Defendants’ MSA. CHIC contends that it had little choice but to execute the MSA, which it did in March 2006.

In Section 4(a) of the MSA, the parties purported to designate CHIC’s creation of the patient-education materials as works made for hire under 17 U.S.C. § 101 and, in turn, CHIC purported to assign its interest in the work-for-hire copyrights to Defendants.

CHIC contends, however, that the patient education materials which it created did not qualify as works for hire, stating that the patient education materials were not “instructional texts” or “textbook materials.” Moreover, it states that the materials were not used and were not designed to be used in “systematic instructional activity” or as part of a “curriculum.” Finally, it asserts that the materials were not part of a teaching method established by an educational institution or the government. Rather, it claims that the materials were prepared for general readership for use in marketing a pharmaceutical product commercially, both nationally and internationally. It concludes that, because the patient education materials did not qualify as works for hire, CHIC did not transfer any copyright interests to Defendants through section 4 of the MSA.

CHIC continues its assertions by claiming that, throughout the last seven years, Defendants have copied and used CHIC’s works in an effort to derive profits from the marketing and sale of Byetta. Defendants have earned gross profits in excess of several billions of dollars from the allegedly unauthorized use, copying, and publication of CHIC’s works. As such, CHIC contents that Defendants’ profits gained from the use, copy, and publication of CHIC’s works rightfully belong to CHIC.

In the complaint, copyright attorneys for CHIC allege a single cause of action: copyright infringement. CHIC asks the court for damages, attorneys’ fees, costs of court, and pre-judgment and post-judgment interest.

Practice Tip: What seems to have begun as a garden-variety contract dispute has been transformed into a copyright case which will presumably turn in no small part on the term of art “work made for hire.”

Under 17 U.S.C. § 101, a “work made for hire” is (1) a work prepared by an employee within the scope of his or her employment; or (2) a work specially ordered or commissioned for use as a contribution to a collective work, as a part of a motion picture or other audiovisual work, as a translation, as a supplementary work, as a compilation, as an instructional text, as a test, as answer material for a test, or as an atlas, if the parties expressly agree in a written instrument signed by them that the work shall be considered a work made for hire. For the purpose of the foregoing sentence, a “supplementary work” is a work prepared for publication as a secondary adjunct to a work by another author for the purpose of introducing, concluding, illustrating, explaining, revising, commenting upon, or assisting in the use of the other work, such as forewords, afterwords, pictorial illustrations, maps, charts, tables, editorial notes, musical arrangements, answer material for tests, bibliographies, appendixes, and indexes, and an “instructional text” is a literary, pictorial, or graphic work prepared for publication and with the purpose of use in systematic instructional activities.

August 12, 2013

Hallmark Home Mortgage Sues Hallmark Rentals & Management for Declaratory Judgment of Non-Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana — Hallmark Home Mortgage, LLC of Fort Wayne, Indiana sued Hallmark Rentals & Management, Inc. of Bloomington, Indiana seeking a declaration that its uses of “Hallmark,” including an application for the trademark “Hallmark,” Serial No. 85/937,259, which is currently pending with the U.S. Trademark Office, are non-infringing.

Hallmark Home Mortgage was founded in February 2007. It operates a mortgage-lending business under the trademark “Hallmark Home Mortgage,” which currently operates in 11 locations in Indiana, Ohio and Florida. It asserts that it has plans to expand its business into other states. Hallmark Home Mortgage focuses on financial services for residential real estate.

In its complaint, Hallmark Home Mortgage states that it began using the Hallmark Home Mortgage trademark in connection with its home mortgage lending business in February 2007. Since then, it claims that it has continuously and prominently used the trademark in connection with its home-mortgage lending business.

Hallmark Home Mortgage has a pending application for trademark registration with the U.S. Patent and Trademark Office for the “Hallmark” mark (word only), in International Class 036 and used in connection with the following: Financial services, namely, mortgage planning; Financial services, namely, mortgage refinancing; Housing services, namely, real property acquisition and consumer financing to facilitate home ownership; Insurance agencies in the field of home, vehicles, personal property; Insurance brokerage in the field of home insurance; and Mortgage brokerage.

In addition to the application pending with the U.S. Patent and Trademark Office, Hallmark Home Mortgage is also the owner of the Trademark “Hallmark Home Mortgage,” Registration No. 2013-0263, which is registered with the State of Indiana. This mark is registered for use in connection with residential mortgage financing, settlement of mortgage loans, mortgage insurance and related services.

Hallmark Rentals & Management, the Defendant, operates one location in Bloomington, Indiana, at which it provides commercial and residential property management services under the brand name “Hallmark Rentals & Management.”

In May 2013, Hallmark Rentals & Management sent a cease-and-desist letter to Hallmark Home Mortgage claiming that the latter was infringing on Hallmark Rentals & Management’s intellectual-property rights in the “Hallmark” mark and, further, was engaging in unfair competition. In its communications, it claimed to own “common law trademark rights, common law service mark rights, and trade name rights . . . with regard to the Hallmark name.” It further indicated that it uses the Hallmark name in “activities hav[ing] to do with real estate.” Finally, it stated that it would sue Hallmark Home Mortgage if Hallmark Home Mortgage did not immediately cease and desist from any use of the term “Hallmark.”

In response, Hallmark Home Mortgage sued Hallmark Rentals & Management for declaratory judgment. It seeks a judgment of non-infringement of common law trademark rights under the Lanham Act, common law and the laws of Indiana.

In the complaint for declaratory relief, intellectual-property lawyers for Hallmark Home Mortgage listed the following:

· Count I: Declaratory Judgment of Non-Infringement

· Count II: Declaratory Judgment of No Unfair Competition

Hallmark Home Mortgage asks for a judgment that its use of the “Hallmark” trademark does not infringe upon any trademark rights of Hallmark Rentals and Management; a judgment that its use of the “Hallmark” trademark does not constitute unfair competition; an injunction preventing Hallmark Rentals and Management from interfering with Hallmark Home Mortgage’s use and registration of the trademark “Hallmark,” and from opposing, seeking to cancel, or otherwise objecting to any registration applications to the “Hallmark,” trademark; attorney’s fees and costs.

Practice Tip: Rights to a trademark may be limited to a particular segment of trade, on the theory that consumers would not be confused by two entities with similar names that engaged in significantly dissimilar businesses. For example, consumers are not likely to confuse Delta Airlines and Delta Faucet. Concurrent trademark registrations may also be allowed for marks that are geographically separate.

August 9, 2013

North American Van Lines Sues North American Master Lines for Infringement of “northAmerican” Mark

By Overhauser Law Offices, LLC

South Bend, Indiana — Trademark lawyers for North American Van Lines, Inc. of Ft. Wayne, Indiana sued North American Master Lines, Inc. of Hallandale, Florida alleging infringement of two trademarks for NORTHAMERICAN, Registration Nos. 0917431 and 0915264, which have been registered by the U.S. Trademark Office.

North American Van Lines asserts that, as early as 1946, it has used the mark “northAmerican” in conjunction with its packing and transportation services and that it has provided such services in all fifty states and the District of Colombia. It owns two registrations for the mark, both of which were issued in 1971.

North American Master Lines provides packing and transportation services across the United States. It offers local and interstate services for residential, business and military customers.

North American Van Lines claims that North American Master Lines previously did business as “1^st Choice Van Lines, Inc.” and that it changed its name to North American Master Lines in October 2012. North American Master Lines also registered and is using the “NorthAmericanMasterLines.com” domain name.

North American Van Lines has filed a lawsuit alleging trademark infringement, unfair competition and cybersquatting. It states in its complaint that North American Master Lines was aware of the “northAmerican” marks and used them to profit from the consumer goodwill related to those marks. It claims that it has received complaints from consumers who were confused regarding whether North American Master Lines was affiliated with North American Van Lines. It also asserts that it sent a cease-and-desist letter to North American Master Lines but received no response.

The complaint lists the following counts:

· Count I: Cybersquatting Under 15 U.S.C. § 1125(d) with Respect to the NORTHAMERICAN Marks

· Count II: Trademark Infringement of the NORTHAMERICAN Marks Under 15 U.S.C. § 1114(1)

· Count III: Unfair Competition and False Designation of Origin of NORTHAMERICAN Marks Under 15 U.S.C. § 1125(a)

· Count VI [sic]: Unfair Competition and Trademark Infringement of the NORTHAMERICAN Marks Under Common Law

North American Van Lines asks for a judgment that North American Master Lines has infringed upon the “northAmerican” marks; the transfer of the domain name “NorthAmericanMasterLines.com”; an injunction; an order directing North American Master Lines to engage in corrective advertising; an accounting and disgorgement of profits resulting from unlawful acts; damages, including treble damages; statutory damages up to $100,000 for domain-name infringement; and attorney fees and costs.

Practice Tip: Under U.S. trademark law, geographic terms or signs cannot be registered as trademarks if they are geographically descriptive of where the goods (or services) originate. However, a geographical indication, as defined by the World Trade Organization, can also identify a particular good, not merely a geographic area. In such a case, a geographic term has been used to identify the provider of a good and, over time, consumers begin to use that geographic term not only as a descriptor of the geographic source, but also of a particular company. In such a case, the term has acquired “secondary meaning” — the capacity to identify the provider of the good — and can be protected as a trademark.

August 8, 2013

Royal Purple Sues Compressor Parts, Michael Klipstein and Southern Parts & Engineering for Trademark Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana — Royal Purple, LLC of Indianapolis, Indiana has sued Compressor Parts of Holland, Ohio; Michael Klipstein (“Klipstein”) and Southern Parts & Engineering Company, LLC (“Southern Parts”) of Alpharetta, Georgia (collectively, “Defendants”) for infringement of the trademarks ROYAL PURPLE and SYNFILM, which have been registered by the U.S. Trademark Office.

Royal Purple, which has also recently sued Liqui Moly, about which we blogged yesterday and previously, has filed an additional trademark-infringement suit in the Southern District of Indiana against Compressor Parts, Klipstein and Southern Parts.

Royal Purple claims it has sold lubricants for more than 20 years and has trademarked the color purple, at least in conjunction with various lubricating oils. It owns several federal trademark registrations for the color purple as applied to lubricating oils for automotive, industrial and household uses. It also owns multiple trademarks incorporating the word “purple” as applied to various goods. It also owns a trademark for the term “Synfilm,” for synthetic, para-synthetic and hydrocarbon lubricants for industrial uses. These trademarks are registered with the U.S. Trademark Office.

Purple was chosen for its association with royalty. (Historically, purple dye was so expensive to produce that it was used only by royalty.) Royal Purple’s purple-identified lubricant products are sold in over 20,000 retailers in the United States and Royal Purple claims a strong secondary meaning and substantial goodwill in its trademark as a result of this use.

In this complaint, trademark lawyers for Royal Purple assert that Defendants offer goods on the compressorparts.com website using Royal Purple marks in a manner that is likely to cause a substantial number of ordinary consumers to be mistaken, confused or deceived into thinking that Defendants’ goods are offered by or affiliated with Royal Purple. The complaint includes the following:

· Count I: Federal Trademark Infringement

· Count II: False Designation of Origin/False Advertising

· Count III: Unfair Competition Under Indiana Common Law

· Count IV: Common Law Trademark Infringement

Royal Purple seeks a permanent injunction; an accounting; damages, including punitive damages; interest; costs and attorneys’ fees.

Practice Tip: As part of the claim, Royal Purple’s lawyers included a count of trademark dilution. This cause of action is distinct from trademark infringement and applies to trademarks that are deemed to be famous. An action for dilution can assert either, or both, of two principal harms: blurring and tarnishment. Dilution by blurring, codified in 15 U.S.C. 1125(c)(2)(B), arises when association with another similar mark causes the distinctiveness of the famous mark to be compromised. In contrast, dilution by tarnishment under 15 U.S.C. § 1125(c)(2)(C) happens when the reputation of the famous mark is damaged by association with a similar mark.