Justia Intellectual Property Opinion Summaries

Organik and Dow both manufacture opaque polymers, hollow spheres used as additives to increase paint’s opacity. Dow has maintained its worldwide market-leader position through a combination of patent and trade-secret protections. Dow filed a complaint with the International Trade Commission requesting an investigation into whether Organik’s opaque polymer products infringed four Dow patents. The Commission granted Dow’s request, and the parties began discovery. During the proceedings, Dow amended its complaint to add allegations of trade secret misappropriation when it discovered that Organik may have coordinated the production of its opaque polymers with the assistance of former Dow employees. As Dow attempted to obtain discovery relating to the activities of those employees, Dow discovered spoliation of evidence “on a staggering scale.” The Federal Circuit affirmed the Commission’s imposition of default judgment and entry of a limited exclusion order against Organik as sanctions for the spoliation of evidence. Organik’s “willful, bad faith misconduct” deprived Dow of its ability to pursue its trade secret misappropriation claim effectively. The record supports the limited exclusion order of 25 years with the opportunity for Organik to bypass that order at any time if it can show that it has developed its opaque polymers without using Dow’s misappropriated trade secrets. View "Organik Kimya v. International Trade Commission" on Justia Law

Personal Web’s patent describes and claims methods (or devices for carrying out methods) of locating data and controlling access by giving a data file a substantially unique “True Name” that depends on its content. The patent describes generating a True Name using mathematical algorithms (hash functions) that use a file’s contents to generate a small-size identifier. It calls for comparing that name with values in a network, determining whether a user is authorized to access the data, and providing or denying access based on that determination. Apple petitioned for inter partes review, arguing unpatentability under 35 U.S.C. 103, for obviousness based on a combination of one reference that focuses on a system for backing up or restoring data and one that focuses on a system for managing rights to access data. The Patent Trial and Appeal Board agreed with Apple. The Federal Circuit affirmed the Board’s claim construction of “content-dependent name,” “content-based identifier,” and “digital identifier,” but vacated the obviousness determination because the Board did not adequately support its findings that the prior art disclosed all elements of the challenged claims and that a relevant skilled artisan would have had a motivation to combine the references to produce the claimed inventions with a reasonable expectation of success. View "Personal Web Technologies, LLC v. Apple, Inc." on Justia Law

MPHJ’s 173 Patent, entitled “Distributed Computer Architecture and Process for Document Management,” describes a system and method that “extends the notion of copying from a process that involves paper going through a conventional copier device, to a process that involves paper being scanned from a device at one location and copied to a device at another location.” The patent calls its invention a “Virtual Copier” whose purpose is “to enable a typical PC user to add electronic paper processing to their existing business process,” and states that it replicates an image “using a single GO or START button, to do a similar operation in software so that the image gets seamlessly replicated into other devices or applications or the Internet.” The Patent Trial and Appeals Board, on inter partes review, found certain claims invalid for anticipation of obviousness. The Federal Circuit affirmed, citing Supreme Court precedent that “when unexpired patents are reviewed by the Board, the claims are given their broadest reasonable interpretation consistent with the specification and the prosecution history, from the viewpoint of persons skilled in the field of the invention,” and upholding the Board’s constructions of the claim terms “application” and “rendering.” View "MPHJ Technology Investments, LLC v. Ricoh Americas Corp." on Justia Law

Defendant Donald Bowers was previously involved in a civil trade secret misappropriation case that was litigated in the United States Federal District Court. During the course of that litigation, Bowers willfully and repeatedly violated a permanent injunction, and refused to purge himself of civil contempt. His actions resulted in findings of civil contempt against him, judgments against him for the plaintiff’s attorneys’ fees, and, ultimately, a criminal referral to the United States Attorney for the District of Utah. A federal grand jury subsequently indicted Bowers on two counts of contempt. The case proceeded to trial, where a jury found Bowers guilty of both counts. Bowers was sentenced to a term of imprisonment of fifteen months, to be followed by a thirty-six month term of supervised release. He was also directed, as a condition of supervised release, to make monthly payments on the outstanding amount owed by him to the plaintiff in the underlying civil case. Bowers appealed, arguing that the district court erred in: (1) imposing a special condition of supervised release requiring him to make monthly payments on the outstanding judgments owed to the plaintiff in the civil case; (2) denying his motion for disclosure of the criminal referral; and (3) sentencing him to a term of imprisonment that exceeded six months. Finding no reversible error, the Tenth Circuit affirmed. View "United States v. Bowers" on Justia Law

Shire sued Watson for infringing the 720 patent by filing an Abbreviated New Drug Application (ANDA) with the FDA seeking to market a generic version of Shire’s drug, LIALDA®. The patent is directed to a controlled-release oral pharmaceutical composition of mesalamine used to treat inflammatory bowel diseases. The district court rejected Watson’s invalidity arguments that the patent lacked written description and enablement, and held that Watson infringed two claims. On appeal, and again after remand from the Supreme Court, the Federal Circuit stated that the matrix compositions are “limited by the Markush groups” added during prosecution “to overcome the examiner’s rejection of the claims as obvious” and that “the correct construction requires that the inner volume contain substances from the group described for the inner lipophilic matrix (which are all lipophilic substances), and that the outer volume separately contain substances from the group described for the outer hydrophilic matrix (which are all hydrophilic).” On remand, the district court concluded that Watson’s ANDA Product satisfied the “inner lipophilic matrix” and “outer hydrophilic matrix” limitations and satisfied the Markush limitations because the excipients falling outside the respective Markush groups were “unrelated” to the invention since they did not drive the water-affinity property of their respective matrices. The Federal Circuit reversed and remanded with instructions to enter judgment of non-infringement. Watson’s ANDA Product does not satisfy the Markush group requirements. View "Shire Development, LLC v. Watson Pharmaceuticals, Inc." on Justia Law

Design Data filed suit alleging that UE infringed the copyright on Design Data's computer aided design (CAD) program by downloading an unauthorized copy of the program and importing and distributing within the United States program output generated by a Chinese contractor using an unauthorized copy of the program. The court affirmed the district court's conclusion that the copyright protection afforded Design Data's computer program does not, on these facts, extend to the program's output; affirmed the district court's decision to refuse Design Data a further opportunity to amend its complaint; reversed the district court as to its determination on summary judgment that UE's download of Design Data's SDS/2 program was a de minimis copyright violation; and remanded for further proceedings. View "Design Data Corp. v. Unigate Enterprise" on Justia Law

Plaintiff sells personal care kits. Plaintiff’s products include a line of “Minimergency Kits,” which come in small fabric bags designed to look like men’s Dopp Kits (a now-cancelled trademark for travel kits, originally for men’s shaving gear, used widely by the military in World War II). Urban Aid also sells personal care kits. It agreed to create a custom kit for a shoe distributor, for use in a sales promotion. The distributor wanted the kits to come in a bag similar to plaintiff’s bag and gave Urban Aid a picture of plaintiff’s bag to work from. After the distributor began its sales promotion, plaintiff filed suit, alleging that the shape and design of its bag were protected trade dress, that Urban Aid’s bag violated the Lanham Act, the Illinois Uniform Deceptive Trade Practices Act, and the Illinois Consumer Fraud and Deceptive Business Practices Act, and that Urban Aid’s bag tortiously interfered with plaintiff’s prospective business relations. The district court found that plaintiff’s claimed trade dress was functional as a matter of law and granted Urban Aid summary judgment on the Lanham Act and the related state-law claims. The Seventh Circuit affirmed; the undisputed evidence shows that the claimed design features affect product quality. View "Arlington Specialties, Inc. v. Urban Aid, Inc." on Justia Law

This case arises from a copyright dispute revolving around the Usenet. Giganews owns and operates several Usenet servers and provides its subscribers with fee-based access to content stored on its own servers as well as content stored on the servers of other Usenet providers. Livewire provides its subscribers with access to the Usenet content stored on Giganews’s servers. Perfect 10, owner of exclusive rights to tens of thousands of adult images, filed suit against Giganews and Livewire, alleging direct and indirect copyright infringement claims as well as trademark and state law claims. The copyright claims are at issue in this appeal. The court concluded that the district court did not err in requiring Perfect 10 to satisfy the volitional conduct requirement as an element of a prima facie case of direct infringement, and agreed with the district court that Perfect 10 failed to prove volitional conduct with respect to either Giganews or Livewire. The court concluded that the district court did not err in dismissing much of Perfect 10’s direct infringement claim at the pleadings stage, nor did it err in granting summary judgment in favor of Giganews and Livewire on the direct, vicarious, and contributory infringement claims; concluded that the district court did not abuse its discretion in awarding fees to defendants and denying defendants' supplemental fee request; and held that the district court did not clearly err in refusing to add Perfect 10's sole shareholder and founder, Norman Zada, to the judgment against Perfect 10. Accordingly, the court affirmed the judgment. View "Perfect 10, Inc. v. Giganews, Inc." on Justia Law

Slep-Tone produces karaoke music tracks marketed under the trademark "Sound Choice" on encoded compact discs (CD-G). Plaintiffs filed suit against defendants for, inter alia, trademark infringement after finding out that defendants were using unauthorized media-shifted files instead of Slep-Tone's original CD-Gs. The district court granted defendant's motion to dismiss. Slep-Tone argues that, by "media-shifting" its tracks from physical CD-Gs to digital files and performing them without authorization, defendants committed trademark infringement and unfair competition under the Lanham Act,15 U.S.C. 1114, 1125. The court agreed with the Seventh Circuit's holding that "the ‘good’ whose ‘origin’ is material for purposes of a trademark infringement claim is the ‘tangible product sold in the marketplace’ rather than the creative content of that product." Therefore, the court concluded that Slep-Tone failed to plausibly allege consumer confusion over the origin of a good properly cognizable in a claim of trademark infringement. Accordingly, the court affirmed as to this issue. In a concurrently filed memorandum opinion, the court also reversed in part and remanded in part. View "Slep-Tone Entertainment Corp. v. Wired for Sound Karaoke" on Justia Law

Ultraflo filed suit against Pelican, asserting an unfair competition by misappropriation claim under Texas law. Ultraflo alleged that Pelican stole its drawings showing how to design valves and then used them to make duplicate valves. The court previously held that copyright preempts this Texas cause of action when the intellectual property at issue is within the subject matter of copyright. Ultraflo contends that its claim escapes preemption because its valve design, when separated from the drawing itself, is afforded no protection under the Copyright Act, 17 U.S.C. 101 et seq. Determining that Ultraflo did not waive its preemption challenge, the court concluded the district court correctly found that the state claim is preempted because copyright preemption prohibits interference with Congress’s decision not to grant copyright protection just as much as it protects a decision to provide protection. Accordingly, the court affirmed the judgment. View "Ultraflo Corp. v. Pelican Tank Parts, Inc." on Justia Law