Patent Infringement

December 31, 2013

Vehicle Service Group Sues Mohawk Resources for Patent Infringement

New Albany, Indiana – Vehicle Services Group, LLC of Madison, Indiana(“VSG”), via an Indiana patent lawyer, has sued Mohawk Resources, LTD of Amsterdam, New York(“Mohawk”) alleging patent infringement of VSG’s “Electronically Controlled Vehicle Lift and Vehicle Service System,” Patent No. 6,983,196 (the “‘196 patent”), which has been registered by the U.S. Patent Office.

VSG is a designer and manufacturer of vehicle lifts, such as those one might see lifting a car in an auto mechanic’s shop. VSG’s ‘196 patent relates to a vehicle lift that has an electronic control which is functional to control the raising and lowering of the lift and to enable the display of a variety of information.

Mohawk also makes vehicle lifts, and is a direct competitor of VSG in the marketplace. The lifts that are at issue in this case (the “Accused Lifts”) include various Mohawk products. The complaint cites infringement by the Mobile Column Lifts identified as model numbers MP-18, MP-24 and MP-30. Those particular lifts purportedly incorporate the technology covered by VSG’s ‘196 patent, and thus infringe that patent.

In addition to levying allegations of patent infringement, VSG also claims that Mohawk is actively and knowingly inducing infringement of at least claim 145 of the ‘196 patent by instructing third parties, such as customers, to network together the Accused Lifts. Finally, Mohawk is accused of knowingly contributing to the infringement by others of the ‘196 patent by making, using, offering for sale, and selling the Accused Lifts.

An Indiana patent attorney alleged the following on behalf of VSG in a civil action for patent infringement:

• Count I: Patent Infringement
• Count II: Inducing Infringement
• Count III: Contributory Infringement

VSG asserts that Mohawk’s acts of infringement of the ‘196 patent have caused and will continue to cause VSG substantial and irreparable injury. It also contends that the infringing activities have been willful and asks the court for judgment as follows:

A. That Mohawk be found to infringe the ‘196 patent;
B. That Mohawk, its officers, agents, servants, employees and attorneys, and all persons in active concert with them, or any of them, be preliminarily and permanently enjoined from infringing the ‘196 patent;
C. That VSG be awarded damages adequate to compensate for Mohawk’s infringement of the ‘196 patent;
D. That the Court deem this case to be exceptional; and
E. That VSG be awarded its attorneys’ fees, expenses, and costs of this action.

Practice Tip: This is at least the second complaint filed by VSG in the Southern District of Indiana and assigned to Judge Sarah Evans Barker. A previous lawsuit, Vehicle Service Group, LLC v. Stertil-Koni USA, Inc., makes similar allegations of patent infringement.

December 27, 2013

Federal Circuit Rejects Broad Right of Public Access to Patent Trials

By Overhauser Law Offices, LLC

Washington, D.C. – The United States Court of Appeals for the Federal Circuit held that a showing of good cause was sufficient to support parties’ requests to file documents under seal. The case was heard by Circuit Judges Sharon Prost, William C. Bryson and Kathleen O’Malley.

Courts have traditionally acknowledged a right of free access to patent information. Lately, however, judges have increasingly restricted the general public’s access to patent litigation. The Federal Circuit spoke to this in the matter of Apple Inc. v. Samsung Electronics Co., Ltd., which recently resulted in a new verdict for Apple, this time for $290 million. picture of the court.jpg

In the patent litigation that led to that verdict, the parties had agreed that certain documents were to be filed under seal. Judge Lucy H. Koh had rejected this agreement and instead had required that the parties provide “compelling reasons” for sealing documents. The parties appealed this ruling.

The Federal Circuit discussed the public-policy implications of shielding patent infringement trials from the public eye. It rejected the notion that general public interest in a trial involving patent litigation is sufficient to require that the briefs and evidence be made available to the public. Instead, the Federal Circuit held that the public’s interest must be more than mere curiosity where the information at issue was not central to the court’s decision on the merits of the case. It also held that the interests of the parties in maintaining the confidentiality of their information must be considered. The court wrote, “[w]hile protecting the public’s interest in access to the courts, we must remain mindful of the parties’ right to access those same courts upon terms which will not unduly harm their competitive interest.”

The Federal Circuit reversed the district court, holding that a showing of “compelling reasons” was not the correct standard to apply when determining if parties should be allowed to file documents under seal. Instead, under the law, only a showing of “good cause” is required.

Practice Tip: This case is unusual in that it reached the appeals court. Typically, when patent attorneys for the parties agree to keep information secret, most district court judges are willing to allow evidence and briefs to be filed under seal. It is perhaps due to the considerable public interest in this case that Judge Koh declared before the trial that “the whole trial is going to be open.”

December 23, 2013

CleanTech Adds Three Additional Defendants to Multidistrict Litigation

By Overhauser Law Offices, LLC

Indianapolis, Indiana – GS CleanTech Corporation of Alpharetta, Georgia (“CleanTech”) has filed complaints against three new Defendants in its ongoing multidistrict litigation in which it asserts infringement of its patented corn-oil-extraction technology. Patent lawyers for CleanTech sued Homeland Energy Solutions, LLC of Lawler, Iowa (“Homeland”) in the Northern District of Iowa. Pacific Ethanol, Inc. of Sacramento, California (“Pacific”) was sued in the Eastern District of California. Guardian Energy, LLC of Janesville, Minnesota (“Guardian”) was sued in the District of Minnesota. At issue in this litigation are the following: Patent Nos. 7,601,858, Method of Processing Ethanol Byproducts and Related Subsystems; 8,008,516, Method of Processing Ethanol Byproducts and Related Subsystems; 8,008,517, Method of Recovering Oil from Thin Stillage; 8,283,484, Method of Processing Ethanol Byproducts and Related Subsystems; and 8,168,037, Method and Systems for Enhancing Oil Recovery from Ethanol Production Byproducts, which have been issued by the U.S. Patent Office. The cases were transferred to 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 Patent No. 7,601,858 (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; Adkins Energy, LLC; Little Sioux Corn Processors, LLLP; Little Sioux Corn Processors, LLLP and Western New York 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, patentee CleanTech has further asserted infringement by some of the allegedly infringing Defendants of four additional patents in the ‘858 patent family: U.S. Patent Nos. 8,008,516 (the “‘516 patent”), 8,008,517 (the “‘517 patent”), 8,283,484 (the “‘484 patent”) and, the newest addition, 8,168,037 (“the ‘037 patent”), (the ‘858, ‘516, ‘517, ‘484, ‘037 patents are, collectively, the “‘858 patent family” or “the patents-in-suit”).

CleanTech claims that the method claimed increases the efficiency and economy of recovering corn oil. CleanTech’s patented methods recover corn oil by evaporating, concentrating and mechanically separating thin stillage (“stillage”), a byproduct of ethanol produced from corn, into two components: corn oil and a post-recovery syrup (“syrup”) with most of its corn oil removed.

In one embodiment, the patented method comprises initially processing the whole stillage by mechanically separating (such as by using a centrifugal decanter) the whole stillage into distillers wet grains and thin stillage, and then introducing the thin stillage into an evaporator to form a concentrated syrup byproduct. Prior to recombining the then-concentrated syrup with the distillers wet grains, the syrup is introduced into a second mechanical separator, such as a second centrifuge, which is different from the centrifuge that mechanically separated the whole stillage into distillers wet grains and thin stillage. This second centrifuge separates corn oil from the syrup thereby allowing for the recovery of usable corn oil. The syrup that exits the centrifuge is then recombined with the distillers wet grain and dried in a dryer. The corn oil that is extracted from the syrup can be used for various purposes such as feedstock for producing biodiesel.

Patent attorneys for CleanTech have made different claims against the three new Defendants. All of the patents-in-suit – the ‘858 patent, the ‘516 patent, the ‘517 patent, the ‘484 patent, and the ‘037 patent – have purportedly been infringed by Homeland. Guardian has been accused of having infringed four of the five patents-in-suit: the ‘858 patent, the ‘516 patent, the ‘517 patent and the ‘484 patent. One claim of patent infringement, regarding the ‘858 patent, has been asserted against Pacific.

Practice Tip: Multi-district litigation affords consistency and judicial economy, as well as allowing plaintiffs and defendants to concentrate their efforts in one forum. However, lawsuits that are not settled before trial must later be remanded to the transferring court and to a judge who has had little opportunity to become familiar with the issues.

December 20, 2013

Indiana University Sues AngioDynamics for Patent Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Patent attorneys for Indiana University Research and Technology Corporation (“IURTC”) of Indianapolis, Indiana sued in the Southern District of Indiana alleging that AngioDynamics, Inc. of Latham, New York infringed Patent No. 6,719,717, which has been registered with the United States Patent and Trademark Office (“USPTO”). This Indiana patent has a publication date of April 13, 2004.

IURTC is a not-for-profit corporation that fosters collaboration between Indiana University faculty and researchers and private industry through the licensing of technology. IURTC states that its goals include acting as a resource for researchers, for industry and for Indiana.

AngioDynamics was founded in 1988. It seeks to provide benefits to patients through the designing, developing, manufacturing and marketing of innovative therapeutic devices used by interventionalists and surgeons for the minimally invasive treatment of peripheral vascular disease, tumor therapy and other, non-vascular disease.

IURTC, via its patent attorneys, is suing AngioDynamics for patent infringement under 35 U.S.C. § 101, et seq. The patent at issue is Patent No. 6,719,717 (the “‘717 Patent”), which relates to thrombectomy treatment systems and methods. IURTC states that, by assignment, it is the current owner of all rights, title, and interests in the ‘717 Patent, including the right to enforce the patent.

The products accused of infringing IURTC’s patent (the “Accused Products”) are allegedly manufactured by Vortex Medical, Inc., a wholly owned subsidiary of AngioDynamics. IURTC contends that AngioDynamics has made and/or currently imports, sells, offers to sell, and/or uses the Accused Products. It also asserts that AngioDynamics provides instructions and directions on how to use the Accused Products to doctors, and other medical personnel.

IURTC further claims that AngioDynamics has known of the ‘717 Patent since at least the date of its issuance by the USPTO. It contends that, as a result, AngioDynamics’ infringement of the ‘717 Patent has been and continues to be willful and deliberate.

Patent lawyers for IURTC filed a complaint alleging a single count of patent infringement. The complaint contends that AngioDynamics is currently infringing and has infringed the ‘717 Patent directly by, without authority, having made and/or currently importing into the United States, and/or using, selling, and/or offering for sale the Accused Products, which embody the inventions claimed in the ‘717 Patent. It also claims that AngioDynamics is actively, intentionally, and/or knowingly inducing infringement of the ‘717 Patent by others, including doctors,and other medical professionals, and is thus liable to IURTC pursuant to 35 U.S.C. § 271(b).

IURTC has asked that the court enter judgment:

A. Finding that U.S. Patent No. 6,719,717 is valid, enforceable, and infringed by AngioDynamics, and that AngioDynamics is liable for inducement of infringement and contributory infringement of the ‘717 Patent;
B. Entering a permanent injunction against AngioDynamics, enjoining it, its respective directors, officers, agents, employees, successors, subsidiaries, assigns, and all persons acting in privity or in concert or participation with AngioDynamics from making, using, selling, or offering for sale in the United States, or importing into the United States, any and all products and/or services embodying the patented inventions claimed in the ‘717 Patent;
C. Holding that AngioDynamics acted willfully in causing damage to IURTC;
D. Awarding IURTC such damages to which it is entitled, pursuant to 35 U.S.C. § 284;
E. Awarding IURTC enhanced damages, pursuant to 35 U.S.C. § 284;
F. Awarding IURTC pre-judgment and post-judgment interest as allowed by law; and
G. Awarding IURTC its costs, expenses, and fees, including reasonable attorneys’ fees, pursuant to 35 U.S.C. § 285.

Practice Tip:

Universities today often own sizeable portfolios of patents and can earn substantial royalties from licensing those patents. To maintain that revenue, most universities seek ownership of the inventions created by their employees, typically by having the employee assign the intellectual property rights to the university. Moreover, if federal funds were used to pursue the research leading to the invention, universities are required under the Bayh-Dole Act to obtain ownership of the resulting patent.

Substantial legal difficulty can arise when the ownership of a patent is unclear. Such a problem can arise when the duty of an inventor to convey ownership of his or her invention has not been established in advance of the creation of new intellectual property. An Indiana patent attorney can help Indiana inventors determine what rights they have with respect to their inventions.

December 6, 2013

Stant Sues Briggs & Stratton for Infringing Its Patented Fuel Cap

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Stant USA Corp. of Connersville, Indiana has sued for patent infringement in the Southern District of Indiana alleging that Briggs & Stratton Corp. of Wauwatosa, Wisconsin infringed its Evaporative Emissions Control Fuel Cap, Patent Number 7,261,093, which has been registered by the U.S. Patent and Trademark Office (“USPTO”).

Stant designs and manufactures vapor-management systems, fuel-delivery systems and thermal-management systems. Among its products are fuel caps intended for use as original equipment by automotive manufacturers and other manufacturers, including small engine manufacturers and for use as replacement parts in the aftermarket. Stant has been in business since 1898.

Briggs & Stratton, founded in 1908, holds itself out as the world’s largest producer of air-cooled gasoline engines for outdoor power equipment and has annual revenues in excess of $2 billion. The company builds over 9,000,000 engines in the U.S. each year and employs over 3,000 employees in six states.

It is alleged that Stant employees met with Briggs & Stratton employees in 2004 and disclosed to them a fuel cap for use on a lawn mower or other small engine that incorporated carbon to filter the fuel vapor before it escaped to the atmosphere.

On July 21, 2004, Stant filed U.S. provisional patent application no. 60/589,761 directed to an evaporative emissions control fuel cap. On July 19, 2005, Stant filed U.S. utility patent application no. 11/184,474 also directed to an evaporative emissions control fuel cap. Based on these applications, the USPTO issued U.S. Patent No. 7,261,093 (“the ‘093 patent”). The caps disclosed in these applications are purportedly similar to the caps disclosed to Briggs & Stratton in 2004.

Stant asserts that Briggs & Stratton has made, used, sold and/or offered for sale lawn mower engines that include a fuel cap that incorporates carbon particles to control evaporative emissions. It also contends that the fuel caps made by Briggs & Stratton embody the patented inventions of, and infringe at least claims 1 and 22 of, the ‘093 patent.

Patent attorneys for Stant ask the court for a permanent injunction; an order directing the destruction of all molds, machines, tooling or other equipment used in the manufacture of Briggs & Stratton’s fuel caps; damages, including up to treble damages; costs; fees and prejudgment interest.

Practice Tip: In the United States, an inventor has a grace period of one year from the time an invention is publicly disclosed and the time that a patent application may be filed, if patent protection for that invention is desired. However, many countries have no grace period. It is therefore wise to file a patent application before disclosing an invention publically. If that is not practicable, executing a written non-disclosure agreement prior to disclosure is advisable.

November 27, 2013

Eli Lilly Sues Actavis for Infringement of Patents Related to Axiron

By Overhauser Law Offices, LLC

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

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

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

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

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

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

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

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

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

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

November 26, 2013

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

By Overhauser Law Offices, LLC

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

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

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

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

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

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

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

November 13, 2013

Endotach’s Patent Infringement Lawsuit Against Cook Medical Dismissed for Lack of Standing

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Endotach LLC of Plano, Texas sued Cook Medical Inc. of Bloomington, Indiana alleging infringement of Endovascular Bypass Graft, U.S. Patent No. 5,122,154 (the “‘154 patent”) and Endovascular Stent with Secure Mounting Means, U.S. Patent No. 5,593,417 (the “‘417 patent”; collectively, the “Rhodes patents”) issued by the U.S. Patent Office. Endotach filed its complaint in the Northern District of Florida. The case was transferred to the Southern District of Indiana upon Cook’s request.

The patents at issue, both of which were issued in the 1990s, were granted to Dr. Valentine Rhodes, an award-winning surgeon who practiced in the field of vascular medicine for over 30 years. The patents are directed to intraluminal and endovascular grafts for placement within a blood vessel, duct or lumen to hold it open. As it pertains to this lawsuit, the patents-in-suit are used for revascularization of aneurysms or stenosis occurring in blood vessels which includes anchoring projections to aid in securing the graft in place within the blood vessel.

Upon the death of Dr. Rhodes, the patents-in-suit passed as part of his estate. Dr. Rhodes’ Will bequeathed all “tangible personal property” to his wife, Brenda Rhodes (“Mrs. Rhodes”). However, there was no specific bequest of the Rhodes patents or mention of any intangible property. The Will’s residuary clause bequeathed “all the residue of [Dr. Rhodes’] estate, real and personal” to a Trust (the “Rhodes Trust”). Upon Dr. Rhodes’ death, his two daughters and Mrs. Rhodes became Co-Trustees of the Trust.

In November 2009, Mrs. Rhodes executed a document entitled “Exclusive License Agreement,” listing herself as the “patent owner.” The agreement purported to transfer an exclusive license on the ‘417 patent to Acacia Patent Acquisition LLC. That license was later assigned to Endotach and amended to include the ‘154 patent.

Endotach sued Cook in July 2012 asserting infringement of one or more claims in each of the patents-in-suit. In that complaint, it asserted that Mrs. Rhodes owned the patents-in-suit and that, as a result of the exclusive license Mrs. Rhodes had granted, Endotach had the right to enforce the patents against all infringers.

Cook moved to dismiss the lawsuit for lack of subject matter jurisdiction arguing that Endotach did not have standing to bring suit. On July 12, 2013, presumably in response to the motion, an “amendment” to the exclusive licensing agreement transferred an exclusive license on the Rhodes patents to Endotach from the Rhodes Trust. It was signed by Mrs. Rhodes and the other Co-Trustees.

In this opinion, Senior Judge Larry J. McKinney addressed Cook’s contention that Endotach did not have standing to sue. The court concluded that Endotach did lack standing as Mrs. Rhodes did not have any individual property interest in the Rhodes patents at the time that she purported to convey an exclusive license. The court dismissed Endotach’s lawsuit without prejudice.

Practice Tip #1: The principle of standing that is important in this case is whether or not Endotach had any legal rights and interests to the Rhodes patents at the time it filed suit. While there are some exceptions, in general, a plaintiff may not sue to assert rights held by third parties.

Practice Tip #2: Apparently realizing that the earlier effort to convey the license might be successfully challenged (as it was) and the case dismissed as a result (as it was), an additional complaint was filed on July 16, 2013, shortly after a new attempt was made to convey to Endotach an exclusive license to the patents-in-suit, this time by the Rhodes Trust. See here.

October 30, 2013

Second-Filed Litigation Stayed Pending Venue Ruling in First-Filed Litigation

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Nexans, Inc. of New Holland, Pennsylvania sued Belden, Inc. of Richmond, Indiana in the District of Delaware. At issue were allegations of infringement of Patent Nos. 6,074,503, Making enhanced data cable with cross-twist cabled core profile; 7,135,641, Data cable with cross-twist cabled core profile; 7,977,575, High performance data cable; 5,796,046, Communication cable having a striated cable jacket; and 7,663,061, High performance data cable, which have been issued by the U.S. Patent Office. Two days after Nexans’ complaint was filed, Belden sued Nexans regarding the same patent infringement claims in the Southern District of Indiana. The Indiana court has stayed the litigation filed by Belden pending a ruling by the Delaware court.

On November 19, 2012, Nexans filed a complaint for declaratory action in the District of
Delaware against Belden seeking a declaration of non-infringement and invalidity of U.S. Patent Nos. 6,074,503 (the “‘503 Patent”), 7,135,641 (the “‘641 Patent”), and 7,977,575 (the “‘575 Patent”), as well as a judgment that Belden has infringed U.S. Patent No. 5,796,046 (the “‘046 Patent”).

On November 21, 2012, Belden sued Nexans in Indiana, alleging infringement of the ‘503, ‘575, and ‘064 Patents. It also alleged infringement of U.S. Patent No. 7,663,061 (the “‘061 Patent”). On December 3, 2012, Nexans filed an amended complaint in the Delaware action, seeking an additional declaratory judgment of non-infringement and invalidity of Belden’s ‘061 Patent.

In this opinion, Magistrate Judge Mark J. Dinsmore ruled on Nexans’ motion to stay the patent infringement lawsuit filed by Belden in Indiana. Nexans argued that a stay should be issued until the Delaware Court, as the first-filed court, had decided the issue of venue.

Judge Dinsmore first discussed the analysis appropriate to a determination of whether to stay litigation. Specifically, the following factors must be considered in deciding whether to stay an action: (i) whether a stay will unduly prejudice or tactically disadvantage the non-moving party, (ii) whether a stay will simplify the issues in question and streamline the trial, and (iii) whether a stay will reduce the burden of litigation on the parties and on the court.

In the case of duplicative patent actions, the general rule is that the first-filed action is preferred, even if it is declaratory, unless consideration of judicial and litigant economy, and the just and effective disposition of disputes, requires otherwise. Belden argued that two circumstances warranted departing from the general first-filed rule: 1) the convenience factors under 28 U.S.C. § 1404, which it argued would favor proceeding in Indiana, and 2) that Nexans’ suit in Delaware constituted forum shopping, which would allow the Indiana court to bypass the first-filed rule.

The court was not persuaded by this reasoning. Instead, it noted that, while the Seventh Circuit has approved of second-filed courts doing this analysis, and proceeding when it is in the interests of justice to do so, the Federal Circuit’s rulings control this issue in patent infringement cases. In turn, the Federal Circuit has expressly declined to apply the departure test to patent infringement cases, and has held that it prefers the first-filed rule.

The court next addressed the issue of whether the second-filed court may decide the applicability of the first-filed rule. It observed that the Federal Circuit has not yet expressly addressed whether the second-filed court may decide the applicability of the first-filed rule. While commenting that district courts have come to differing conclusions on the issue, the court was most convinced by the reasoning in those cases that have reserved the application of the first-filed rule for the first-filed court.

In concluding, the court found that it “would be at odds with the promotion of judicial and litigant economy for the court to proceed with the analysis of the exceptions to the first-filed rule.” It held that the “first-to-file rule has generally been interpreted to dictate not only which forum is appropriate, but also which forum should decide which forum is appropriate” and stayed the Indiana litigation, pending a ruling on venue from the Delaware court.

Practice Tip: The present action was stayed pending the Delaware court’s resolution of the pending motions to enjoin and dismiss. The parties in this case have been instructed to notify the Indiana court of the Delaware district court’s rulings on these motions as soon as they are issued.

October 10, 2013

Sam’s Club Sued by Escalade Sports for Infringing Patented Table Tennis Ball Storage Apron

By Overhauser Law Offices, LLC

Evansville, Indiana – Indian Industries, Inc. d/b/a Escalade Sports of Evansville, Indiana (“Escalade Sports”) has sued Sam’s East, Inc. d/b/a Sam’s Club of Bentonville, Arkansas (“Sam’s Club”) in the Southern District of Indiana alleging infringement of its patented TABLE TENNIS BALL STORAGE APRON, Patent No. 8,414,431 (the “‘431 patent”), which has been issued by the U.S. Patent Office.

Escalade Sports began in 1927 as Indian Archery And Toy Co. It is a global company which offers goods related to basketball, table tennis, archery and other sports. Escalade Sports and its predecessors have been in the business of selling table-tennis tables and accessories since 1973.

Sam’s Club, a chain of membership-only retail clubs, was founded in 1983. A subsidiary of Wal-Mart Stores, Inc., it was named after Walmart founder Sam Walton. Sam’s Club has more than 47 million members and operates approximately 600 retail warehouse clubs in the United States, along with locations in Brazil, China and Mexico. Sam’s Club operates 16 warehouse clubs in Indiana.

On April 9, 2013, the ‘431 patent was issued for an invention titled “Table Tennis Ball Storage Apron.” Prior to its issuance, the ‘431 patent was purportedly assigned to Escalade Sports. At issue in this suit is a feature of a table-tennis table which Escalade Sports claims is protected under the ‘431 patent.

Escalade Sports markets its table-tennis tables and accessories under a number of marks, including the Stiga® mark, which is used under a license from Stiga Sports AB. In the fall of 2013, Escalade Sports launched a new line of Stiga® table-tennis tables which included ball storage racks mounted along the width of the ends of the table, adjacent the player. These tables include the Stiga® Master Series ST3100 and ST4100 tables and the Stiga® STS185, STS285, STS385, STS420 and STS520 tables (the “Stiga® Storage Rack Tables”). According to the complaint, the ‘431 patent covers Escalade Sports’ Stiga® Storage Rack Tables.

Escalade Sports asserts that, sometime in 2013, Sam’s Club began selling and offering to sell the “ESPN 2 Piece Table Tennis” product. It asserts that this product infringes claims 1 through 15 of the ‘431 patent.

Patent attorneys for Escalade Sports filed this patent infringement lawsuit asserting a single claim: the infringement of the ‘431 patent. Escalade Sports contends that this infringement includes, in part, the sale and offer for sale of the ESPN 2 Piece Table Tennis product.

Escalade Sports asserts that it has been damaged by Sam’s Club’s alleged infringement and that it will suffer irreparable injury unless Sam’s Club is permanently enjoined by the court. Escalade Sports seeks: a judgment of infringement of the ‘431 patent by Sam’s Club; injunctive relief restraining Sam’s Club and its agents from further acts of infringement; an order that any devices subject to control by Sam’s Club which infringe upon any claim of the ‘431 patent be delivered up and destroyed; an award to Escalade Sports of damages, costs, attorney’s fees and/or expenses associated with this action; an award of Sam’s Club’s wrongful profits associated with any infringement of Escalade Sports’ intellectual property rights; to have any award of damages be increased to the maximum amount permitted under 35 U.S.C. §284; and an order declaring that this is an exceptional case under 35 U.S.C. § 285, upon a finding that Sam’s Club knowingly and willfully infringed.

Practice Tip:

The “willfulness” of the alleged infringement is an important issue in patent litigation because willful infringement may result in a tripling of the damages awarded to the patent holder. Willfulness consists of two elements: (1) an objective element that is often, but not always, a question of law, and (2) a subjective element that is inherently a question of fact, to be decided by the jury.

Under the first prong, if an “accused infringer’s position is susceptible to a reasonable conclusion of no infringement,” the infringer’s conduct cannot be objectively unreasonable. Conversely, an action is objectively unreasonable if the infringer acted despite an objectively high likelihood that its actions constituted infringement of a valid patent.

When considering the second prong – the element of subjective willfulness – fact-finders should consider: (1) whether the infringer copied the patentee’s commercial products; (2) whether the infringer presented evidence that it obtained legal opinions of patent counsel to justify its infringing actions; (3) whether the infringer attempted to avoid infringement by designing around the patents; and (4) whether the infringer acted in accordance with the standards of commerce.