Indiana Intellectual Property Law News

May 15, 2014

Indiana Copyright Litigation – Malibu Media Sues Alleging Infringement of 43 Copyrighted Works

Indianapolis, Indiana – A copyright attorney for Malibu Media, LLC of Los Angeles, California d/b/a X-Art.com filed a copyright infringement lawsuit in the Southern District of Indiana alleging that an anonymous defendant (“John Doe”), asserted to be an Indiana resident, infringed 43 copyrighted works to which Malibu Media claims ownership.

Malibu Media contends that infringement by John Doe of the works, which include multiple pornographic movies, began on September 14, 2013. Currently, the defendant is identifiable by Malibu Media only by his or her internet protocol address (“IP address”). Malibu Media asserts that it used “geolocation” technology to ensure that the anonymous defendant’s alleged acts of copyright infringement occurred using an IP address that could be traced to a physical address within Indiana.

Malibu Media has accused the defendant of a single count of “Direct Infringement” encompassing all 43 copyrighted works. It seeks a permanent injunction against infringing activities; an order by the court to remove infringing materials from all computers of the defendant; an award of statutory damages pursuant to 17 U.S.C. § 504(a) and (c) and reasonable attorneys’ fees and costs.

Practice Tip:

It has been estimated that over 200,000 users of various peer-to-peer file-sharing protocols, usually users of BitTorrent, have been sued for copyright infringement. Instead of a thorough investigation, followed by a lawsuit, these plaintiffs — usually holders of a copyright to a work of adult entertainment — gather the IP addresses of many potential/presumed infringers and then sue multiple defendants.

These suits used to involve tens, hundreds or even thousands of defendants joined in a single suit. The problem of these cases of mass joinder of largely unrelated defendants became sufficiently widespread that it garnered attention from mainstream press (see, e.g., here).

The problem also caused considerable strain on the federal judiciary, leading one judge to deny joinder as serving no legitimate purpose in such cases once IPSs have been put on notice to preserve identifying information for particular IP addresses and to opine that it is “difficult to even imagine the extraordinary amount of time federal judges have spent on these cases.” Many other courts also denied joinder, often on the theory that, while doing so does not solve the problem of trolling for copyright damages within the federal judiciary it, at least, makes pursuing such abusive litigation much less profitable.

As a result of such rulings, copyright attorneys such as Paul Nicoletti have modified their practices and now have shifted to filing more single-defendant copyright infringement complaints. While this may solve the earlier problem of mass misjoinder, many other contentious issues inherent in copyright trolling – including proper identification of the alleged infringer – remain.

May 14, 2014

Internet Policy Task Force to Host Series of Roundtables on Copyright Internet Policy Topics

By Overhauser Law Offices, LLC

Washington, D.C. – Public meetings called for in U.S. Commerce Department’s Green Paper on “Copyright Policy, Creativity, and Innovation in the Digital Economy” will be held in Tennessee, Massachusetts and California.

The U.S. Department of Commerce’s Internet Policy Task Force will host roundtable discussions in cities around the country on several copyright Internet policy topics, as part of the work envisioned in the Green Paper. The purpose of the roundtables is to engage further with members of the public on the following issues: (1) the legal framework for the creation of remixes; (2) the relevance and scope of the first sale doctrine in the digital environment; and (3) the appropriate calibration of statutory damages in the contexts of individual file sharers and of secondary liability for large-scale infringement.

The roundtables, which will be led by the U.S. Patent and Trademark Office (“USPTO”) and the National Telecommunications and Information Administration (NTIA), will be held in Nashville, Tennessee on May 21, 2014, Cambridge, Massachusetts on June 25, 2014, Los Angeles, California on July 29, 2014, and Berkeley, California on July 30, 2014.

May 12, 2014

Malibu Media Sues “John Doe” for Copyright Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Malibu Media, LLC d/b/a X-Art.com of Los Angeles, California has sued an unidentified Indiana resident, “John Doe,” for copyright infringement in the Southern District of Indiana.

Copyright lawyer Paul Nicoletti is again in federal court on behalf of Malibu Media. The “John Doe” defendant in this copyright infringement lawsuit allegedly used the BitTorrent file-sharing protocol to illegally download, copy and distribute elements of various works of Malibu Media’s copyrighted material. Malibu Media has also claimed that the defendant is a “persistent online infringer.” It claims that “John Doe” has infringed 67 separate copyrighted works owned by Malibu Media.

Malibu Media seeks a permanent injunction against infringing activities; an order by the court to remove infringing materials from all computers of the defendant; an award of statutory damages pursuant to 17 U.S.C. § 504(a) and (c) and reasonable attorneys’ fees and costs.

Practice Tip #1:

The actions of companies such as Patrick Collins and Malibu Media have been called “extortionate” and, in at least one case, a class action suit has been filed against these “copyright trolls.”

The issue of intellectual property “trolls” has also caught the attention of several U.S. lawmakers, including Senator Charles Schumer. Senator Schumer has proposed legislation wherein the U.S. Patent and Trademark Office would review patent infringement suits before they could be filed in court. Of course, such legislation is not directly relevant to actions sounding in copyright, such as the multiplicity of lawsuits filed by Malibu Media and Patrick Collins. It may, however, sound a warning bell that tolerance of the questionable activities of intellectual-property trolls of all varieties is wearing thin.

Practice Tip #2:

We have previously blogged about Malibu Media’s previous attempts to sue unrelated defendants en masse (see also here), as well as some responses of various Indiana courts (see also here and here).

May 8, 2014

USPTO Creates New Office of International Patent Cooperation

By Overhauser Law Offices, LLC

WASHINGTON, D.C. – The U.S. Department of Commerce’s United States Patent and Trademark Office (“USPTO”) recently announced the creation of a new Office of International Patent Cooperation (“OIPC”). The OIPC will be led by Mark Powell who will serve as USPTO’s first Deputy Commissioner for International Patent Cooperation. Deputy Commissioner Powell will report directly to the Commissioner for Patents Margaret (Peggy) Focarino. The establishment of the OIPC reflects USPTO’s strong commitment to work with global stakeholders and intellectual property (“IP”) offices to develop means to increase quality and create new efficiencies within the complex processes of international patent rights acquisition, and its commitment toward global patent harmonization, which both protects America’s ideas and makes it easier to do business abroad.

“The establishment of the Office of International Patent Cooperation reflects the USPTO’s strong commitment to the IP community in improving the international patent system,” said Deputy Under Secretary of Commerce for Intellectual Property and Deputy Director of the USPTO Michelle Lee. “It will allow us to increase certainty of IP rights while reducing costs for our stakeholders and moving towards a harmonized patent system.”

While the USPTO has been effective in carrying out its international mission through such programs as the Patent Prosecution Highway, the Global Patent Search Network, the Cooperative Patent Classification system, and the new Global Dossier Initiative, creation of the new office will enable USPTO to focus dedicated resources to better implement its international patent cooperation efforts. The main focus of the office, working in concert with the Office of Policy and International Affairs and the Office of the Chief Information Officer, is to provide optimized business process solutions to the international patent examination system for examiners and external stakeholders.

May 7, 2014

U.S. Supreme Court Holds Commercial Injury and Proximate Cause Necessary for False Advertising Claim Under Lanham Act

By Overhauser Law Offices, LLC

Washington, D.C. – The United States Supreme Court unanimously affirmed a Sixth Circuit ruling that intellectual property lawyers for defendant Static Control Components, Inc. of Sanford, North Carolina had properly pled a counterclaim for false advertising under the Lanham Act against Lexmark International, Inc. of Lexington, Kentucky. The Court held that a Lanham Act claim under §1125(a) may be asserted by plaintiffs who are within the zone of interests protected by the Lanham Act and whose injury was proximately caused by a violation of that statute.

Lexmark sells both printers and toner cartridges for those printers. In addition to selling new Lexmark-branded toner cartridges, it refurbishes used Lexmark cartridges. Those refurbished products are sold in competition with the new cartridges. To hinder others from reusing its cartridges, Lexmark includes a microchip that disables an empty cartridge until Lexmark replaces the chip. Respondent Static Control, a maker and seller of components for the remanufacture of Lexmark cartridges, developed a microchip that enabled empty Lexmark cartridges to be refilled and used again.

Lexmark sued for both copyright infringement and patent infringement. It also informed Static Control’s customers that Static Control had infringed its patents. Static Control counterclaimed, alleging that Lexmark had engaged in false or misleading advertising in violation of §43(a) of the Lanham Act, 15 U. S. C. §1125(a). Static Control alleged that Lexmark’s misrepresentations had damaged Static Control’s business reputation and impaired its sales.

The Supreme Court was asked to decide what had been styled by the District Court as a “prudential standing issue”: whether Static Control fell within the class of potential Lanham Act plaintiffs. Arguments that Lanham Act plaintiffs may assert standing under the Second Circuit‘s test – requiring a “reasonable interest” and a “reasonable basis” for the plaintiff’s claim of harm – were rejected by the Court.

Instead, in determining the appropriate reach of the Lanham Act, the Court relied on the traditional principles of statutory interpretation. It acknowledged the longstanding principle that the question for courts in determining who was a proper plaintiff was not a matter of judicial “prudence” but rather one of determining the intent of Congress when it authorized certain plaintiffs to sue under §1125(a): “We do not ask whether in our judgment Congress should have authorized Static Control’s suit, but whether Congress in fact did so.”

The Court thus held that, in a statutory cause of action, protection is extended only to those plaintiffs whose interests fall within the zone of interests protected by the law invoked. Because the Lanham Act lists among its purposes the protection of “persons engaged in [interstate commerce] against unfair competition,” and because “unfair competition” is interpreted to be concerned with injuries to business reputation and present and future sales, a lawsuit for false advertising must allege injury to a commercial interest in reputation or sales.

The Court then considered whether the harm alleged in this case was sufficiently similar to the conduct that the Lanham Act prohibits. It held that the harm is required to have been proximately caused by violations of the statute. In the case of a false advertising claim under the Lanham Act, a commercial injury caused by deceiving consumers was held to be a sufficient link between the wrongful act (the false advertising) and the injury (damage to a business’ reputation and/or sales).

The Court concluded that Static Control had adequately pleaded all elements of a Lanham Act cause of action for false advertising.

Practice Tip: The Court held that, in the case of a Lanham Act claim for false advertising, “a direct application of the zone-of-interests test and the proximate-cause requirement supplies the relevant limits on who may sue.” This test excludes as Lanham-Act plaintiffs some who have indisputably been damaged by false advertising. For example, the Lanham Act does not apply to non-business consumers who have been the victims of false advertising, as the Act restricts its class of plaintiffs to those who have suffered an injury to a “commercial interest” in reputation or sales.

May 5, 2014

146 Trademark Registrations Issued to Indiana Companies in April 2014

By Overhauser Law Offices, LLC

The U.S. Trademark Office issued the following 146 trademark registrations to persons and businesses in Indiana in April 2014 based on applications filed by Indiana trademark attorneys:

Reg. Number	Word Mark	Click to View
4523691	FINANCING EXCLUSIVELY FOR INSURANCE PROFESSIONALS	View
4522026	EVERYONE LOVES OViewR	View
4521898	TRANSFORMATIONAL THEOLOGY	View
4521893	LEADERS BUILD LEADERS	View
4521824	CHOCOLATE SOLDIER	View
4521682	MRC	View
4521661	WTIU	View
4521660	WFIU	View
4521587		View
4521348	LADY HOUDINI	View

May 2, 2014

Patent Office Issues 197 Patents To Indiana Citizens in April 2014

By Overhauser Law Offices, LLC

The U.S. Patent Office issued the following 197 patent registrations to persons and businesses in Indiana in April 2014, based on applications filed by Indiana patent attorneys:

PAT. NO.		Title
D703,500		Gas cap removal tool
8,712,748		Medical diagnosis, therapy, and prognosis system for invoked events and methods thereof
8,712,654		Acceleration based mode switch
8,712,591		Constant low-flow air source control system and method
8,710,950		Wireless control system for a patient support apparatus
8,710,784		Vehicle seating system and method for reducing fatigue with changing actuator movement
8,710,437		Ion generation using wetted porous material
8,710,154		Non-aqueous solution process for the preparation of cross-linked polymers
8,710,063		Purine compounds used as CB2 agonists
8,709,797		Systems and methods for cryopreservation of cells
8,709,648		Conductor-mixed active electrode material, electrode structure, rechargeable battery, and manufacturing method of conductor-mixed active electrode material

May 1, 2014

Insurance Coverage for Advertising Injury: Allstate Held to Have No Duty to Defend or Indemnify Against Allegations of False Advertising

By Overhauser Law Offices, LLC

Indianapolis, Indiana – An insurance attorney for Allstate Insurance Company of Northbrook, Illinois (“Allstate”) filed a Motion for Summary Judgment in the Southern District of Indiana. Allstate asked the court to declare that it had no duty to defend or indemnify the defendants in a putative class action lawsuit proceeding against the defendants in the Middle District of Georgia. The Indiana court ruled against Defendants Preferred Financial Solutions, Inc. (“PFS”) of Indianapolis, Indiana; Credit Card Relief, Inc. (“CCR”) of Indianapolis, Indiana; Jeffery Brooks, President of PFS and CCR of Zionsville, Indiana and Thomas P. Dakich, d/b/a Dakich & Associates, of Indianapolis, Indiana.

This lawsuit concerns Allstate’s obligations to the defendants with respect to a class action lawsuit filed in Georgia against the defendants and others (the “underlying litigation”). The complaint in the underlying litigation, filed by the underlying plaintiffs, alleges that the defendants are interrelated entities that collectively comprise a debt-adjustment-services operation that targets financially troubled customers and extracts fees for worthless services.

In this litigation, which the underlying plaintiffs are attempting to classify as a class action, it is alleged that the defendants promote themselves in print, on the internet, and in broadcast media as a provider of debt-settlement services, debt-elimination services and debt-reduction services. The underlying plaintiffs contend that the defendants never made any attempts to pay or settle the debts of at least some members of the putative class.

The defendants tendered the complaint to Allstate for defense, asserting that the claims in the underlying litigation triggered potential coverage as a covered peril – an “advertising injury” – under the provisions of their insurance contracts with Allstate.

This issue – whether Allstate’s contract for insurance coverage for an “advertising injury” required them to defend and indemnify the defendants – was submitted to the Indiana District Court. Allstate moved for judgment as a matter of law, asserting that the conduct at issue did not qualify as an advertising injury. It contended that it thus had no duty to provide a defense in the underlying litigation.

Under the terms of the insurance agreement, an “advertising injury” was defined in the insurance contract as an “injury arising out of one or more of the following offenses:

1. Oral or written publication of advertising material that slanders or libels a person or organization or disparages a person’s or organization’s goods, products or services;
2. Oral or written publication of advertising material that violates a person’s right to privacy;
3. Misappropriation of advertising ideas or style of business; [and/or]
4. Infringement of copyright, title or slogan as a result of your advertising.”

Excluded from coverage was “[a]ny advertising injury arising out of…[i]ncorrect description of or mistake in advertised price of goods, products or services sold, offered for sale or advertised.”

The Indiana court, in an opinion written by Magistrate Judge Debra McVicker Lynch, noted that there had been no allegation of defamation, violation of privacy, misappropriation of advertising ideas or infringement of intellectual property in defendants’ advertising. As a result, the court concluded that no “advertising injury,” as it was defined in the insurance contract, had occurred. As that holding was dispositive, the court did not reach the issue of whether the exclusion to coverage for “incorrect description” would have applied. As no coverage was found to exist, Allstate was determined to have neither the duty to defend nor to indemnify the defendants.

Practice Tip:

Exclusions to coverage in insurance policies are narrowly construed. However, it seems likely that, had the court not disposed of this matter as not fitting within the definition of “advertising injury,” it would have instead concluded that there was no coverage upon construing the exclusion for “incorrect description” of goods or services offered.

In contrast, businesses sued for defamation, invasion of privacy, misappropriation of advertising ideas and/or infringement of intellectual property, would be wise to consult their commercial general liability insurance policies to evaluate whether such an advertising injury is considered a covered peril.

April 28, 2014

Indiana Patent Litigation: CleanTech Sues Pacific Ethanol Magic Valley

By Overhauser Law Offices, LLC

Indianapolis, Indiana – A patent attorney for GS CleanTech Corporation of Alpharetta, Georgia (“CleanTech”) filed a patent infringement lawsuit in the District of Idaho alleging that Pacific Ethanol Magic Valley, LLC of Burley, Idaho (“Pacific”); ICM, Inc. of Colwich, Kansas; and David J. Vander Griend of Wichita, Kansas 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 litigation 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 patent infringement 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; Southwest Iowa Renewable Energy, LLC; Western New York Energy, LLC; Homeland Energy Solutions, LLC; Pacific Ethanol, Inc.; Guardian Energy, LLC and Pacific Ethanol Stockton LLC. This Indiana patent lawsuit is being overseen in the Southern District of Indiana pursuant to the provisions for Multidistrict Litigation (“MDL”).

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 CleanTech and its parent GreenShift Corp. have also asserted infringement by some of the allegedly infringing Defendants of four additional patents related to the ‘858 patent: 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 and ‘037 patents are, collectively, the “‘858 patent family” or “the patents-in-suit”). Four of the patents in the “‘858 patent family” – the ‘858 patent, the ‘516 patent, the ‘517 patent, and ‘484 patent – have purportedly been infringed by Pacific.

CleanTech claims that the methods claimed increase 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.

In this current lawsuit, initiated in the District of Idaho, subsidiary GS CleanTech Corp. is the sole Plaintiff. A patent lawyer for CleanTech asserts the following counts against Pacific:

• 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: More than thirty ethanol-production plants have executed installation and licensing agreements with GreenShift Corp., the parent company of CleanTech, for its corn-oil extraction system. When deciding whether to avoid the potential of being included as an additional defendant in ongoing patent infringement litigation, it’s useful to consult an experienced patent attorney to evaluate the possibility of licensing rights to use the patent(s)-in-suit.

April 25, 2014

Indiana Patent Litigation – Bonutti Research and Joint Active Systems Sue Lantz Medical for Patent Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Patent attorneys for Bonutti Research, Inc. (“Bonutti”) and Joint Active Systems, Inc. (“JAS”), both of Effingham, Illinois, filed an intellectual property lawsuit in the Southern District of Indiana alleging that Lantz Medical, Inc. of Indianapolis, Indiana (“Lantz”) infringed multiple patents: “Orthosis,” Patent No. 5,848,979; “Elbow Orthosis,” Patent No. 7,955,286; “Finger Orthosis,” Patent No. 7,404,804; and “Orthosis,” Patent No. 7,112,179, which have been issued by the U.S. Patent Office.

Bonutti claims ownership by assignment of four patents. The patents at issue are:

• Patent No. 5,848,979 (“the ‘979 patent”), titled “Orthosis,” which generally covers apparatuses for use in effecting relative movement between bones in an arm of a patient, was issued in 1998.
• Patent No. 7,112,179 (“the ‘179 patent”), titled “Orthosis,” which generally covers apparatuses for stretching tissue around a joint of a patient between first and second relatively pivotable body portions, was issued in 2006.
• Patent No. 7,404,804 (“the ‘804 patent”), titled “Finger Orthosis,” which generally covers apparatuses for positioning a joint in a finger on a hand of a patient, was issued in 2008.
• Patent No. 7,955,286 (“the ‘286 patent”), titled “Elbow Orthosis,” which generally covers apparatuses for stretching tissue around a joint of a patient between first and second relatively pivotable body portions, was issued in 2011.

The ‘979, ‘179, ‘286, and ‘804 patents are licensed exclusively to JAS. Among the products that JAS develops and markets are products covered by the patents-in-suit, including the JAS Pro/Sup, JAS EZ Pro/Sup, JAS EZ Elbow, JAS EZ Wrist, and JAS EZ Finger products.

Defendant Lantz manufactures and sells, among other products, the Stat-A-Dyne® ESP, Stat-A-Dyne® Pro/Sup, Stat-A-Dyne® Elbow, and Stat-A-Dyne® WHFO products. Bonutti and JAS contend that these products infringe their patented inventions and are sold in direct competition with products offered for sale by JAS.

In a complaint filed by patent attorneys for Plaintiffs, the following claims are made:

• Count I: Infringement of U.S. Patent No. 5,848,979
• Count II: Infringement of U.S. Patent No. 7,955,286
• Count III: Infringement of U.S. Patent No. 7,404,804
• Count IV: Infringement of U.S. Patent No. 7,112,179

Plaintiffs Bonutti and JAS seek injunctive relief, damages, pre- and post-judgment interest, costs and attorneys’ fees.

Practice Tip: Since September 2012, Bonutti Skeletal Innovations LLC, an entity believed to be related to Bonutti Research, Inc., has initiated a series of patent-infringement lawsuits against medical-device manufacturers, including Depuy, Inc.; Zimmer, Inc.; Smith & Nephew, Inc.; Wright Medical Group, Inc.; ConforMIS, Inc.; Arthrex, Inc.; Linvatec Corporation; ConMed Corporation and Biomet, Inc. We blogged about the Biomet lawsuit, in which Biomet sought declaratory judgment of non-infringement and invalidity the Bonutti patents, here.