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Chicago IP Litigation

Tracking Northern District of Illinois IP Cases

Lack of Local Rule 56.1 Support Prevents Summary Judgment

Posted in Local Rules, Summary Judgment

Panoramic Stock Images, Ltd. d/b/a Panoramic Images v. John Wiley & Sons, Inc., No 12 C 10003, Slip Op. (N.D. Ill. Sep. 2, 2014) (Feinerman, J.).

Judge Feinerman granted in part plaintiff Panoramic’s partial summary judgment motion and denied defendant Wiley’s partial summary judgment motion as to Panoramic’s fraud and contributory copyright infringement claims in this copyright case regarding nine stock photographs.  The Court also set a trial date.

Wiley contends that Panoramic lacks the necessary evidence for its fraud claim proving that when Wiley said it wanted the photograph at issue for use in 15,000 volumes, it knew that it intended to use the photograph in more editions that that.  The Court, however, held that Panoramic offered evidence sufficient to infer the necessary intent.  Panoramic had documents showing that prior editions had been larger than 15,000 volumes and that Wiley was forecasting 30,000 volumes.  The Court also held that Panoramic put forth evidence that it was injured by the allegedly false statement beyond the scope of the copyright infringement because it was deprived of the licensing fee at the time of the license, beyond any award for copyright infringement.

The Court also denied Wiley summary judgment as to Panoramic’s contributory copyright infringement claim.  First, Wiley, in its reply, failed to respond to certain of Panoramic’s arguments.  So, the motion was denied on that ground alone.  Furthermore, the fact that Panoramic’s claim may be duplicative of its direct infringement claim was not fatal because parties are allowed to plead in the alternative.  The Court did, however, acknowledge that even if Panoramic succeeded at trial on both claims, it would not receive a double recovery.

The Court denied Wiley’s motion for summary judgment as to a statute of limitations for all claims before December 9.  But because the Seventh Circuit had approved the discovery rule and Panoramic had evidence that it did not know of Wiley’s alleged infringement until sometime in the three years before filing suit, the suit was not time barred.  And there was a dispute of fact as to whether Panoramic should reasonably have been aware of its claims when it learned of similar suits regarding the same issues.

The Court granted Panoramic that it owned valid copyrights in the images that it individually registered, as Wiley conceded.  But denied summary judgment as to images that were filed as part of compilations.  While the Court had previously held that a copyright owner held copyrights in the original components of its copyrighted compilations, the evidence Panoramic cited in its Local Rule 56.1 statement of facts, did not sufficiently support its ownership claims in these works.

The Court denied Panoramic summary judgment that Wiley exceeded the usage limits set forth in the parties agreements because Wiley had evidence suggesting a practice that allowed the parties to exceed those limits as part of the normal course of their business.

Because of the factual issues described above, summary judgment was not appropriate for either party as to Wiley’s affirmative defenses of statutes of limitations, implied license/course of dealing, and invalidity/unenforceability.

The Court denied Panoramic summary judgment as to Wiley’s lashes defense because it could not determine which were subject to a three year limitation on the record before the Court.

 

Substantial Differences Doom Design Patent Claim on the Pleadings

Posted in Summary Judgment

Young v. Stone, No. 13 C 4920, Slip Op. (N.D. Ill. Aug. 28, 2014) (Guzman, J.).

Judge Guzman granted defendant’s Fed. R. Civ. P. 12(c) motion to dismiss plaintiff’s design patent infringement claim regarding defendant’s Putt-A-Round golf practice target.  The patented design and the accused golf practice target are depicted below:

The Court held that the parallel disks were functional as was the pole separating the disks.  The ornamental features were the differing mechanisms that trapped the golf balls, and the extended flagpole.  The Court held that the products were different as follows:

  • The mechanisms used to trap the balls were different. Defendant used an incline that directed the ball up and to the center. Plaintiff used a washer around the center column that held the ball.
  • The feet and prominent bolt on the bottom of defendant’s base was also sufficiently different.
  • There were also differences in the flag placement and the top of the pole.

 

 

 

 

Settlement in First Does Not Bar Discovery in a Second Related Suit

Posted in Discovery

Fasteners for Retail, Inc. v. Andersen, No. 11 C 2164, Slip Op. (N.D. Ill. Aug. 22, 2014) (Durkin, J.).

 Judge Durkin granted in plaintiff Fasteners for Retail’s (“FFR”) motion to enforce the parties’ settlement agreement against defendant K International (“Kinder”) in this patent, Lanham Act and trade secret dispute.  The parties previously resolved this case pursuant to a settlement agreement (“Agreement”) in which the Court retained jurisdiction over any disputes arising out of the Agreement.  The parties did not, however, settle a related Ohio state court action FFR had filed against certain Kinder employees.

 FFR sought to depose Kinder in the Ohio action, but Kinder refused claiming that the Agreement’s broad release from all “obligations” prevented FFR seeking any discovery from Kinder.  While the release language was broad, the Court held that the released obligations were limited by language in the release to liability related to the suit or any consequences of losing the suit, for example an award of fees.  Because the released “obligations” were so limited, FFR was free to seek discovery from Kinter in the Ohio action.

The Court also ordered Kinter to produce a declaration required by the Agreement identifying products sold by Linter upon which a particular individual consulted for Kinder.  Kinder could not limit its declaration to only those product sales that could be traced to the individual’s assistance in developing or marketing the product.  Kinter’s limitation did not exist in the Agreement’s plain language.

 

Trademark Fraud Claims Cannot be Dismissed Before Discovery

Posted in Pleading Requirements

Slep-Tone Enter. Corp. v. Teddy O’Brian’s, Inc., No. 14 C 3570, Slip Op. (N.D. Ill. Sep. 24, 2014) (Guzman, J.).

Judge Guzman granted in part plaintiff Slep-Tone’s Fed. R. Civ. P. 12(b)(6) motion to dismiss defendant’s declaratory judgment of trademark invalidity, cancellation, antitrust and related Lanham Act and state law claims in this trademark dispute regarding a design trademark for SOUND CHOICE started by email Slep-Tone.

While plaintiff was required to disclose to the Trademark Office that it established commercial use base upon its third party licensees, it was “impossible” for the Court to determine based upon the limited information available to it whether or not plaintiff made a false representation to the Trademark Office.

The Court also held that defendant sufficiently pled the fraud-related claims pursuant to Fed. R. Civ. P. 9.  Defendant, however, did not sufficiently plead common law fraud because it did not show how it was damaged by the alleged fraud.  The filing of this suit was not sufficient damage.

Defendant’s antitrust claim failed because there were no allegations regarding Slep-Tone’s pricing practices as required for a Section 13(a) claim.

Finally, defendant’s abuse of process claim was dismissed because it lacked an allegation that plaintiff misused the Court’s processes.

           

Court Construes Key Term But Declines to Construe Any Others

Posted in Claim Construction

Vehicle Intelligence & Safety LLC v. Mercedes-Benz USA, LLC, No. 13 C 4417, Slip Op. (N.D. Ill. Sep. 18, 2014) (Hart, Sen. J.).

Judge Hart construed the claims of plaintiff’s patent to methods for screening equipment operators for impairments.  The parties agreed that “expert system(s)” was the key term that required construction.  The Court construed “expert system(s)” as:

[A] computer program consisting of (1) a database module that contains information a specialist would consider in an analysis of an equipment operator for impairment; (2) a decision module that applies logic for screening and testing an equipment operator for impairment and for controlling equipment, and (3) an interface module which interfaces with one or more equipment modules and the equipment operator.

Having construed the key term, the Court held that the parties’ other six disputed terms did not require construction beyond their respective ordinary meetings.

 

Lady Gaga’s “Judas” Does Not Infringe Copyright

Posted in Local Rules, Summary Judgment

Francescatti v. Germanotta p/k/a Lady Gaga, No. 11 C 5270, Slip Op. (N.D. Ill. June 17, 2014) (Aspen, Sen. J.).

Judge Aspen granted defendants’ Fed. R Civ. P. 56 motion for summary judgment because no reasonable trier of fact could find defendant Lady Gaga’s song “Judas” substantially similar to plaintiff’s song “Juda.”

Local Rule 56.1

As an initial matter, the Court denied defendants’ motion to strike plaintiff’s responses to certain of defendant’s Local Rule 56.1 statements of fact because the Court did not rely upon any of them except one, which did not introduce new facts.  That allowed the Court to avoid the parties’ “labyrinth of disputes.”

Access

There was a question of fact as to whether defendants had access to plaintiff’s copyrighted song.  While there was a dispute about whether defendant Gaynor, who worked with plaintiff on her song, ever came into contact with Lady Gaga, there was no dispute that Gaynor worked on both songs in dispute.

Substantial Similarity

The Court granted summary judgment of no substantial similarity after recognizing that summary judgment of substantial similarity is generally disfavored.  The Court  then denied to apply the inverse ratio rule — requiring a higher standard of proof where evidence of access is relatively weak — because the Seventh Circuit explicitly decided not to endorse it.  The Court then provided an excellent primer on the substantial similarity law.

                                                a.         Expert Testimony

The Court held expert testimony was warranted in this case because:

  • The complexity of the music industry had increased significantly since the adoption of the subjective ordinary observer test.
  • The Lady Gaga song was created with a Digital Audio Workstation (“DAW”) which can create thousands of sounds.
  • The different music genres of the two songs also added to the complexity of the determination.

Although the Court allowed expert testimony and analyzed certain findings of the ordinary observer test, it was explicitly not using a higher standard of review than the ordinary observer test.

                                                b.         Extrinsic Test

The Court found the following similarities between the two songs:

  • Similar titles;
  • Both songs repeat in a monotone the similar words “Juda” or “Judas;” and
  • Limited similarities in the breakdowns.

                                                c.         Intrinsic Test

The Court did not consider expert testimony or plaintiff’s opinion (because she was a musician) because they were not ordinary observers.

The Court did not follow the filtration method, instead considering the similarity of each song’s expression before removing non-copyrightable elements from consideration, noting that the Seventh Circuit has said either method is acceptable.  The Court found an “utter lack of similarity”:

  • It took expert analysis for the Court to see plaintiff’s distinctions;
  • The songs do not have common lyrics;
  • The themes are different; and
  • They do not sound alike musically.

The Court, therefore, found the similarity of expression to be “totally lacking.”  The Court also held that the individual elements were either not similar or not protectable.

No Default Against Non-Existent Corporate Entity

Posted in Trial

RSI Video Techs., Inc. v. Vacant Property Security, LLC, No. 13 C 7260, Slip Op. (N.D. Ill. Mar. 10, 2014) (Holderman, Sen. J.).

 Judge Holderman denied plaintiff RSI’s motion for default judgment against defendant VPS Group, Inc. in this patent case involving security systems.  The other defendants, all various VPS-related entities ultimately responded to the Complaint, except for VPS Group, Inc.  Defendants agreed, and the Court accepted, that VPS Group, Inc. did not answer because it was not a corporate entity.  Instead, “VPS Group” was a designation for a group of related companies.  To avoid confusion or “gamesmanship,” the Court ordered defendants to file a list of all of their affiliated entities to which the Complaints’ subject matter pertained with enough detail to allow RSI to decide whether any of the entities should be joined.  After the disclosure, RSI had two weeks to add any defendants they deemed necessary.

Experts Do Not Prevent Summary Judgment of Design Patent Noninfringement

Posted in Summary Judgment

Voltstar Techs., Inc. v. Amazon.com, No. 13 C 5570, Slip Op. (N.D. Ill. Jul. 28, 2014) (Lee, J.).

Judge Lee granted defendant Amazon’s motion for summary judgment of noninfringement of plaintiff Voltstar’s design patent to an electrical charger and denied Voltstar’s cross-motion for summary judgment.  An ordinary observer viewing the two chargers side-by-side would conclude that they were substantially different:

  • Voltstar’s charger was squat, while Amazon’s was larger and thinner;
  • Each charger’s tapered top was different; and
  • Voltstar’s charger had a “unique” clamshell appearance that Amazon did not have.

The differences cumulatively created a significant overall difference.

While both products differed from the prior art having tapered ends, the tapers were sufficiently different, as noted above.  Voltstar’s expert report identifying alleged similarities did not prevent summary judgment.

Preliminary Injunction Does Not Apply to Redesigns as Long as They are Not Colorable Imitations

Posted in Claim Construction, Local Rules

Scholle Corp. v. Rapak LLC, No. 13 C 3976, Slip Op. (N.D. Ill. Jul. 24, 2014) (Kendall, J.).

Judge Kendall ruled on numerous motions filed after the Court granted a preliminary injunction in this patent case.  Of particular note, the Court held as follows:

  • The Court granted defendant Rapak’s motion to construe more than five claim terms, despite Rapak’s failure to comply with the Local Patent Rules by identifying which terms were case dispositive.  The Court did so despite Rapak’s deficiencies to avoid further delay in the case.
  • The Court ordered Rapak to show cause why Rapak should not be held in contempt for violating the Court’s preliminary injunction by shipping enjoined smoothie valves after the date of the preliminary injunction.  The Court held that the fact that no bond had been set or provided was not a reason that Rapak could delay compliance.  That was especially true because Rapak did not originally raise the bond, the Court did sua sponte.
  • The Court granted Rapak’s motion clarifying that the preliminary injunction only applies to the smoothie valves that were before the Court in the preliminary injunction proceedings and colorable imitations thereof.  The Court, however, declined to rule upon whether Rapak’s redesigned smoothie valves were colorable imitations of the current smoothie valve.
  • The Court granted Rapak’s motion to amend a counterclaim seeking a declaratory judgment that its redesigned smoothie valve did not infringe.
  • The Court denied Rapak’s motion to strike Scholle’s new proposed claim constructions in its response brief.  While they technically did not follow the Local Patent Rules requirements that the parties disclose and confer regarding their respective constructions, Rapak either had notice of the constructions or they were an explanation of the ordinary meaning which Scholle originally set out as the construction.

Plaintiff’s strategy decisions “hoist [it] with his own petard”

Posted in Claim Construction

R-Boc Reps., Inc. v. Minemyer, No. 11 C 8433, Slip Op. (N.D. Ill. Sep. 18, 2014) (Cole, Mag. J.).

Judge Cole denied plaintiff R-Boc’s motion for reconsideration regarding the Court’s prior denial of its motion for leave to amend its Final Invalidity Contentions and supplement its expert reports to add an indefiniteness argument in this patent case.  In the underlying motion, R-Boc argued that the Supreme Court’s recent Nautilus decision which relaxed the indefiniteness standard — created a new indefiniteness argument regarding the term “approximately perpendicular.”  After an explanation of the meaning of Shakespeare’s phrase “hoist with his own petard.” The Court explained that R-Boc was hoist by its own petard in the form of its strategy decisions to propose a construction of the term which defendant agreed to and the Court adopted.  The Court then turned to French in italics to emphasize R-Boc’s repeated strategy decisions since 2008:

  •  “C’est une petard”:  R-Boc proposed its construction.
  • C’est deux petards”:  After defendant accepted R-Boc’s construction, R-Boc chose to forego a claim construction hearing.
  • Le troisieme petard”:  R-Boc waived its indefiniteness arguments.
  • Le quatrieme petard”:  R-Boc filed a summary judgment motion that undercut its instant motion to amend.

Based upon these strategic decisions, R-Boc could not reclaim its indefiniteness arguments despite the changed indefiniteness standard.