Indiana Intellectual Property Law News

October 30, 2019

Indiana Copyright Litigation: Prevailing Plaintiff Ordered to Pay Losing Defendant’s Costs After Rejecting Rule 68 Offer

Indianapolis, Indiana – Judge Richard L. Young of the Southern District of Indiana issued a decision on cross-motions for attorneys’ fees and costs in the case of Richard N. Bell (“Bell”) versus Michael Maloney (“Maloney”). The Court first entered judgment in favor of Bell on June 11, 2019 granting him $200 in statutory damages, and costs. Bell sought $33,536,25 in attorney’s fees and $4,719.80 in costs. Maloney made a cross-motion “for leave to file a Bill of Costs totaling $2,183.77 and to enforce the Rule 68 offer. The Court found that the Rule 68 offer should be enforced and Maloney is entitled to the costs he incurred after the offer was rejected.

Bell sent a demand letter to Maloney for $5,000.00 prior to filing this suit. After Bell filed suit, Maloney filed his Answer and then sent Bell an Offer of Judgment pursuant to FRCP 68. This offer was for $2,500.00 for Bell to take judgment against Maloney and would include all attorney’s fees and costs. Bell denied the Rule 68 offer and after the denial of cross-motions for summary judgment, the case went to a bench trial. After the one-day bench trial, the Court found Bell was the prevailing party and was entitled to $200 in statutory damages. Bell filed his motion for fees and costs eleven months after the bench trial occurred.

FRCP 68 provides in part, “[i]f the judgment that the offeree finally obtains is not more favorable than the unaccepted offer, the offeree must pay the costs incurred after the offer was made.” The court in Payne v. Milwaukee Cty., 288 F.3d 1021, 1024 (7^th Cir. 2002), found that “Rule 68 is designed to provide a disincentive for plaintiffs from continuing to litigate a case after being presented with a reasonable offer.” In determining if a final judgment obtained is less favorable than a Rule 68 offer, “the attorney’s fees and costs that accrued before the offer must be added to the judgment.” Lawrence v. City of Philadelphia, 700 F.Supp. 832, 836 (E.D. PA. 1988).

October 25, 2019

Indiana Patent Litigation: Irvine Shade & Door, Inc. Sued For Alleged Patent Infringement

By Overhauser Law Offices, LLC

South Bend, Indiana – Attorneys for Plaintiffs, Stoett Industries, Inc. (“Stoett”) of Hicksville, Ohio and Newline International, LLC (“Newline”) of Culpeper, Virginia, filed suit in the Northern District of Indiana alleging that Defendant, Irvine Shade & Door, Inc. (“Irvine”) of Elkhart, Indiana, infringed their rights in United States Patent No. 6,470,511 (the “‘511 Patent”) for “SHOWER SCREENS”. Plaintiffs are seeking preliminary and permanent injunction, treble damages, attorneys’ fees, expenses, costs, and other relief the court deems proper.

According to the Complaint, Newline was founded in New Zealand in 1983 and expanded its sales and facilities for shower screens into the United States in 2002. While Newline is the owner of the ‘511 Patent, Stoett claims to be the exclusive distributer for products covered by the ‘511 Patent in the United States via a licensing agreement dated December 2, 2012. Stoett allegedly sells a single shower screen for about $215.00 and has sold over 90,000 shower screens throughout the United states.

Plaintiffs believe Irvine has entered into contracts or has relationships with third-parties to make or sell infringing shower screens which either have or will result in lost sales for Newline and Stoett. As such, Plaintiffs are seeking damages for the alleged infringement of the ‘511 Patent pursuant to 35 U.S.C. § 271. Second, Plaintiffs are alleging Irvine has participated in state deceptive trade practices in violation of Ohio’s deceptive trade practice laws, Ohio Rev. Code § 4165.01, et seq. Finally, Plaintiffs are seeking damages for the alleged unfair competition by Irvine and unjust enrichment.

October 23, 2019

U.S. Court of Appeals for the Federal Circuit Limits Design Patent Scope

By Overhauser Law Offices, LLC

The U.S.Court of Appeals for the Federal Circuit (“CAFC”) issued its Opinion in the case of Curver Luxembourg, SARL (“Curver”) versus Home Expressions Inc., (“Home Expressions”) to construe claim language of a design patent to limit the scope of the claimed design. Curver, the Plaintiff-Appellant in this case, is the assignee of United States Design Patent No. D677,946 (the “‘946 Patent”) for “Pattern for a Chair” that claims “an ornamental design pattern for a chair.” While the ‘946 Patent claims the pattern for the chair, the figures for the design patent are disembodied from any article of manufacture. Curver instituted litigation against Home Expressions alleging that it made and sold baskets that incorporated Curver’s patented design and were thus infringing the ‘946 Patent. The District Court found in favor of Home Expressions as it found the ‘946 Patent was limited to chairs only. Curver then appealed to the CAFC which affirmed the District Court’s decision that the claim language limited the scope of the claimed design to apply to chairs only.

Curver filed for the ‘946 Patent in 2011 with the original title “patent directed to a pattern for furniture.” During prosecution, the examiner objected to many things including the title because under 37 C.F.R. § 1.153, a design patent’s title must designate a “particular article” for the design. Curver allegedly accepted the examiner’s suggestion to direct its pattern to be used for a chair and amended its application accordingly without amending the attached figures.

Home Expressions allegedly makes and sells baskets that have a similar Y-shape to Curver’s ‘946 Patent. Because of this, Curver filed a complaint against Home Expressions alleging its baskets infringed the ‘946 Patent. Pursuant to FRCP Rule 12(b)(6), Home Expressions filed a Motion to Dismiss Curver’s Complaint for failing to plead a plausible claim of infringement, which was granted by the district court. As part of a two-step analysis, the District Court first construed the scope of the ‘946 Patent to be limited to a design pattern for a chair. For part two of the analysis, “the district court found that an ordinary observer would not purchase Home Expression’s basket with the ornamental “Y” design believing that the purchase was for an ornamental “Y” design applied to a chair, as protected by the ‘946 patent.” As such, Curver’s Complaint was dismissed.

October 15, 2019

Design Basics Ordered to Pay Over $300,000.00 in Attorneys’ Fees and Costs

By Overhauser Law Offices, LLC

Fort Wayne, Indiana – Attorneys for Plaintiff, Design Basics, LLC and W.L. Martin Home Designs, LLC, filed suit in the Northern District of Indiana alleging that Defendants, Heller & Sons, Inc. d/b/a Heller Homes and Heller Development Corporation, infringed numerous copyright registrations. The Court granted the Defendants’ Motion for Summary Judgment on June 24, 2019. Design Basics filed its Notice of Appeal on July 19, 2019. Although Design Basics had filed its Notice of Appeal, Defendants submitted their Petition for Attorney Fees and Costs and were awarded $310,759.34.

According to the Opinion and Order dated September 3, 2019, the “Court invited Defendants to file a request for attorneys’ fees pursuant to 17 U.S.C. § 505, and further invited Design Basics to file a response in opposition.” The Court cites an exception from general rules of jurisdiction following a filing of a notice of appeal from Terket v. Lund, 623 F.2d 29, 33-34, in which a district court may enter an award for attorneys’ fees while the merits of the case are on appeal. In this case, Defendants submitted their Petition for Attorney Fees and Costs and Design Basics submitted its response in opposition.

District courts consider at least four different factors listed in Fogerty v. Fantasy, Inc., 510 U.S. 517, 534 n. 19 (1994) when determining whether to award attorneys’ fees, including: “(1) frivolity of the claim; (2) motivation in filing the claim; (3) objective reasonableness of the claim; and (4) considerations of compensation and deterrence.” Here, the Court found that while the Defendants argued the Seventh Circuit’s decision in Design Basics, LLC v. Lexington Homes, Inc., 858 F.3d 1093 (7th Cir. 2017) rendered all copyright cases filed by Design Basics frivolous, Design Basics may still recover on copyright infringement claims although it may be difficult. When analyzing Design Basics’ motivation for filing its infringement claims, the Court noted that Design Basics “realized approximately $5 million in net litigation profits in 2016 and 2017 alone, while the gross revenues for Design Basics during the same period of time were approximately $2.5 million.” Based off this finding, among others, the Court believes that this case, and most infringement cases filed by Design Basics, are filed due to a financial motive.

October 10, 2019

Closure Systems International Sues Novembal USA Seeking Correction of Inventorship

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Attorneys for Plaintiff, Closure Systems International, Inc. (“CSI”) of Indianapolis, Indiana, filed suit in the Southern District of Indiana seeking a correction in inventorship for two U.S. Design Patents issued to Defendant, Novembal USA Inc. (“Novembal”) of Edison, New Jersey. The patents at issue in this case are United States Patent Nos. D836,442 (the “‘442 Patent”) and D838,171 (the “‘171 Patent”) (collectively the “Patents in Suit”). CSI is seeking preliminary and/or permanent injunctions, attorneys’ fees, costs, and any other relief the Court deems proper.

CSI claims three of its employees, Arnold Benecke, Bill Moll, and John Edie, developed a closure for a bottle (the “Option 2 Closure”) for its customer, Nestle Waters (“Nestle”) on or about January 27, 2011. This invention was allegedly assigned to CSI pursuant to assignments from the three inventors. According to the Complaint, on March 9, 2011, CSI sent a presentation concerning the Option 2 Closure and another option to Nestle that stated that it would have “Prototypes molded by April 1” and “Small quantity of slit samples will be sent by April 13”. CSI claims it emailed Nestle a drawing of the Option 2 Closure on March 10, 2011.

CSI claims Nestle trialed different closures from CSI and at least two other competitors, including Novembal, and CSI delivered 100 samples of the Option 2 Closure to Nestle in or about June 2011. CSI alleges each of the manufacturers at the Nestle trials witnessed each closure and saw all the samples provided to Nestle. After the trials, Nestle awarded the business to Novembal, not CSI.

According to the Complaint, Nestle asked CSI to replace Novembal and inquired as to its ability to supply the Option 2 Closure in early 2018. CSI claims it began supplying a similar closure to the Option 2 Closure to Nestle, but it was slightly different (the “New Closure”). On or about May 24, 2019, CSI claims it was informed by Nestle that the New Closure infringed one or more Novembal patents. Just six days later, Novembal allegedly sent a cease and desist letter to CSI stating that the New Closure infringed the ‘442 Patent.

October 9, 2019

Formstack, LLC Sued for Alleged Patent Infringement

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Attorneys for Plaintiff, Transaction Secure, LLC (“Transaction”) a foreign limited liability company, filed suit in the Southern District of Indiana alleging that Defendant, Formstack, LLC (“Formstack”) of Fishers, Indiana, infringed its rights in United States Patent No. 8,738,921 (the “‘921 Patent”) for “System and Method for Authenticating a Person’s Identity Using a Trusted Entity”. Transaction is seeking damages, attorneys’ fees, and any further relief the Court deems proper.

Transaction claims the ‘921 Patent, issued on May 27, 2014, teaches an advancement over two-factor authentication for protecting sensitive information from identity theft. Formstack’s website allegedly operates as the “Accused Product”. Transaction alleges that the Accused Product infringes at least Claim 1 of the ‘921 Patent as it is a trusted entity to authenticate account holders “by using non-personal information for securing personal data.”

According to the complaint, users provide personal information to Formstack to create an account from a trusted computer system. Formstack then allegedly stores the user information confidentially and provides the user with an authorization login that is associated with the user but does not contain the user’s personal information. After the user requests resource access from Formstack using their login, Formstack allegedly “provides an authorization code to obtain the access token and ID token for accessing the services”. Transaction claims “the user identity is verified by the resource server by using the authorization code to allow the user to access the code” in the Accused Product. Transaction claims Formstack’s Accused Product infringes the ‘921 Patent in violation of 35 U.S.C. § 271. As such, Transaction is seeking damages pursuant to 35 U.S.C. §§ 284 and 285.

October 7, 2019

Engineered by Schildmeier Granted Over $1.4 Million Dollars in Default Judgment

By Overhauser Law Offices, LLC

Indianapolis, Indiana – Judge Richard L. Young in the Southern District of Indiana granted default judgment in favor of Engineered by Schildmeier, LLC (“Engineered”) and against WUHU Xuelang Auto Parts Co., LTD and Amazing Parts Warehouse (collectively the “Defendants”). Engineered filed suit seeking a declaratory judgment of both patent and trade dress infringement in late 2018. The patent allegedly infringed in the complaint is United States Patent No. D 816,584 (the “‘584 Patent”) for a “Pair of Bed Rail Stake Pocket Covers”.

When a defendant fails to plead or defend a case against them within the allotted time frame, they are in default. A plaintiff may motion the court for a default judgment, which is a binding judgment of the court for failure of the defendant to answer the allegations. The court can then grant a default judgment. If a proof of damages hearing is necessary, the judge can order such a hearing, but the defendant may not appear at that point to defend the amount of damages asserted by the plaintiff. A default judgment may be set aside upon request of the defendant, but they must show a good defense and legitimate excuse as to why they were in default to the court.

In this case, neither of the Defendants plead or otherwise defended themselves against the allegations set forth in Engineered’s complaint. As such, the court granted Engineered’s motion for default judgment and awarded damages accordingly. First, the Court found that the Defendants infringed the ‘584 Patent. Second, the Court found the Defendants violated Section 43(a) of the Lanham Act by infringing Engineered’s trade dress. Third, the Defendants were enjoined from importing, selling, or offering for sale any imitations of the ‘584 Patent. Finally, Engineered was awarded a total of $1,424,070.00. The damages award was calculated by adding $470,020.00 in lost profits; $940,040.00 in treble damages for willful infringement; $13,610.00 in attorneys’ fees; and $400.00 in court costs. By failing to appear and defend themselves, not only will defendants have default judgments granted against them, but as shown in this case, extremely large damages may also be imposed.

October 4, 2019

Custom Design and Paint Company, The Art of Design, Inc., Seeks Damages for Alleged Copyright Infringement

By Overhauser Law Offices, LLC

South Bend, Indiana – Attorneys for Plaintiff, The Art of Design, Inc. (“TAOD”) of Elkhart, Indiana, filed suit in the Northern District of Indiana alleging that Defendant, Sharpline Converting, Inc. (“Sharpline”) of Wichita, Kansas, infringed its rights in United States Copyright Registration Nos. VA 1-979-388 and 2-149-309 (the “‘388 Design”) and VA 1-982-002 and 2-149-316 (the “‘002 Design”). TAOD is seeking judgment, actual damages, profits, and any further relief as the Court deems proper.

TAOD claims it is a highly respected and successful business engaged in custom airbrushing and the designing of fine art. According to the complaint, TAOD employs very talented individuals who create original two-dimensional designs (the “TAOD Designs”) that are applied to boats, RVs, airplanes, cars, and helicopters. TAOD claims the TAOD Designs are copyrightable and that it owns all right, title, and interest in the TAOD Designs. The ‘388 Design and ‘002 Design are both designs known as the “Shatter Graphics”.

Per the complaint, Sharpline designs and manufactures vinyl graphics for a diverse market, including the marine industry. Sharpline allegedly sells vinyl graphic image products to Pontoon Boat, LLC, doing business as, Bennington and Bennington Marine (“Bennington”). According to the complaint, Bennington provided Sharpline with unauthorized copies of the Shatter Graphics in 2012, which Sharpline then copied, created a vinyl graphic product, and distributed to Bennington for application on Bennington’s boats and boat motors. TAOD claims one of the images provided to Sharpline from Bennington was a photograph of one of Bennington’s boats painted by TAOD with the Shatter Graphics. TAOD alleges Sharpline has reproduced, copied, and distributed unauthorized copies of the TAOD Designs and as such is seeking damages for copyright infringement and inducing copyright infringement.

October 2, 2019

Patent Office Issues 196 Patents To Indiana Citizens in September 2019

By Overhauser Law Offices, LLC

Overhauser Law Offices, the publisher of this site, assists with US and foreign patent searches, patent applications and assists with enforcing patents via infringement litigation and licensing.

The U.S. Patent Office issued the following 196 patent registrations to persons and businesses in Indiana in September 2019, based on applications filed by Indiana patent attorneys:

	Patent No.	Title
1	PP030888	Rugosa shrub rose plant named `KAPswehp`
2	D0860984	Case for a mobile device
3	D0860685	Mattress
4	10,424,975	Sensor module and kit for determining an analyte concentration
5	10,422,797	Electrochemiluminescence method of detecting an analyte in a liquid sample and analysis system

October 1, 2019

198 Trademark Registrations Issued to Indiana Companies in September 2019

By Overhauser Law Offices, LLC

The U.S. Trademark Office issued the following 198 trademark registrations to persons and businesses in Indiana in September 2019 based on applications filed by Indiana trademark attorneys:

Registration No.	Word Mark
5868255	SAND CREEK
5868145	AMBUSH
5867820	ROSE ACRES
5867651	CREAM TATTOO
5867553	SUMMER PROJECT