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Chicago IP Litigation Tracking Northern District of Illinois IP Cases

Monthly Archives: January 2011

Lack of Documentation Regarding Use at the Relevant Time Prevents Summary Judgment

By R. David Donoghue on Posted in Summary Judgment

Eazypower Corp. v. Jore Corp., No. 04 C 6372, Slip Op. (N.D. Ill. Oct. 20, 2010) (Zagel, J.).

Judge Zagel denied defendant Jore’s ("Jore") motion for summary judgment of invalidity in this patent dispute regarding screwdrivers with flexible extension shafts. As a preliminary matter, plaintiff Eazypower repeatedly failed to comply with Local Rule 56.1 regarding statements of material fact. Despite that, the Court accepted Eazypower’s additional facts and responses to Jore’s statements of fact because Jore had sufficient opportunity to respond to them.

Jore argued that a particular screwdriver with a flexible extension shaft, the FB-19, was sold in the United States in the mid-1980s and was invalidating prior art. Eazypower did not dispute that the FB-19 taught each element of the identified patent claims. But Eazypower did dispute that the FB-19 was in fact prior art. First, Eazypower argued that Jore had not sufficiently corroborated its evidence that the FB-19 was sold in the United States in the mid-1980s. Jore’s corroborating evidence – several third parties with knowledge – was sufficient. But there was evidence conflicting with Jore’s position. An age analysis of the FB-19 packaging suggested that it had been built in the late 1970s or early 1980s, but it also showed traces of an adhesive that was not available in the mid-1980s. Additionally, Eazypower showed that relevant shipping records for the period did not show any sales or import of FB-19s. The Court, therefore, held that there was a question of material fact and denied summary judgment.

Court Tries Lanham Act Case on the Papers

By R. David Donoghue on Posted in Trial

RNA Corp. v. The Procter & Gamble Co., No. 08 C 5953, Slip Op. (N.D. Ill. Oct. 21, 2010) (Zagel, J.).

Judge Zagel held that defendant Procter & Gamble’s ("P&G") intellectual property rights could not be held infringed based upon the available evidence and held that on the available record, the Court could not grant attorney’s fees because a prevailing party could not be determined, in this Lanham Act case regarding P&G’s alleged trademarks and trade dress in its Herbal Essence hydrating shampoos and conditioners. Through a series of settlement conferences, the parties agreed to the scope of a preliminary and then a permanent injunction, but were unable to determine money damages issues. The parties, therefore, agreed to submit the remaining issues to trial by the Court on the papers. The Court, therefore, ruled based upon the parties’ written submissions. In my experience, this is a relatively unique way to resolve and especially to try a case in federal court. And it is an excellent example of how willing the Northern District bench tends to be to find cost-effective ways to resolve what are otherwise often prohibitively expensive intellectual property disputes.

Public Records Make Prima Facie Case for Jurisdiction

By R. David Donoghue on Posted in Jurisdiction

Insubuy, Inc. v. Community Ins. Agency, No. 10 C 3925, Slip Op. (N.D. Ill. Nov. 9, 2010) (St. Eve, J.).

Judge St. Eve granted counter-plaintiff Community Insurance Agency’s ("CIA") motion for expedited jurisdictional discovery regarding individual counter-defendants. CIA established a prima facie case of personal jurisdiction warranting discovery based upon public records and affidavits that established that the individual defendant:

  • Was a director, owner and the CEO of plaintiff Insubuy.
  • Registers and maintains domains for Insubuy.
  • Had prior notice of CIA’s trademarks and that CIA was an Illinois corporation.

Expert Allowed to Amend Expert Report Via Deposition Errata Sheets

By R. David Donoghue on Posted in Experts

Bone Care Int’l, LLC v. Pentech Pharm., Inc., No. 08 C 1083, Slip Op. (N.D. Ill. Sep. 30, 2010) (Dow, J.).

Judge Dow decided the parties motions in limine in this patent infringement dispute. Of particular note, the Court made the following rulings:

  • The Court allowed defendants’ anticipation and written description invalidity defenses even though they were not properly disclosed or supported in defendants’ interrogatory responses or expert reports. The anticipation defense was so intertwined with the disclosed obviousness defense that there was no prejudice. And the parties argued the written description defense as part of a summary judgment motion. The Court, however, excluded other undisclosed invalidity defenses.
  • The Court allowed plaintiffs to present evidence regarding the priority date of one of its claims became there was a question of fact as to whether the claim had priority based upon an earlier, related application.
  • Plaintiffs were allowed to call defendants’ expert witnesses in plaintiffs’ case-in-chief so long as the testimony was not just cumulative. Plaintiffs could also call defendants’ experts. Even if defendants chose not to call them Defendants cannot turn an expert into a non-testifying expert pursuant to Fed. R. Civ. P. 26(b)(4)(B), once the expert issued a report and was listed on defendants’ witness list.
  • A parties’ witnesses should be called live whenever possible, unless the witness is unavailable.
  • Defendants’ expert was allowed to add references after the expert report deadline and after his deposition, by identifying the references in a deposition errata sheet and in corrected expert report pages. The references did not significantly change the experts analysis. And plaintiffs questioned the expert about the references during his deposition. So, plaintiffs were not prejudiced.
  • Defendants were also allowed to rely upon their experts’ rebuttal and supplemental reports became the arguments in the reports all properly responded to Plaintiffs’ reports.

Trading Technologies: Court Reconnect Altering Judgment to Reflect Jury Award

By R. David Donoghue on Posted in Trial

Trading Techs. Int’l, Inc. v. Speed, Inc., No. 04 C 5312, Slip Op. (N.D. Ill. Sep. 8, 2010) (Schenkier, Mag. J.).

Judge Schenkier recommended denying plaintiff Trading Technologies’ ("TT") motion to enforce the final judgment and for sanctions. The Court also recommended correcting the final judgment to reflect the jury verdict and the remitted damages award. A jury previously awarded TT $3.5M in damages and found defendant’s infringement willful. The Court later overturned the willfulness finding and ordered a remittitur of damages to $2.5M, which TT accepted. The Court then granted a permanent injunction and entered a final judgment, but that judgment did not reflect the damages award.

Defendant argued that, despite the jury award and remittitur, there was no damages award because it was not reflected in the final judgment and after the Federal Circuit had decided to appeal it was too late to revise the final judgment.

The Court agreed that the first judgment should have included the award, but not that it was too late to fix it. The Court noted that the most likely explanation for the omission was "the fallibility of human beings (judges included)." The Court also noted that TT should have sought to correct the final judgment immediately. But despite the imprecise judgment, the Federal Circuit ruled upon several issues related to the jury verdict, although not the award itself. And neither TT nor defendants disputed the fact or the amount of the damages award. Based upon those facts, the Court recommended that revising the final judgment to reflect the award would merely "correct a clerical mistake or a mistake arising from oversight or omission" pursuant to Fed. R. Civ. P. 60(a). Finally, the Court recognized TT’s frustration over not having received payment 34 months after the jury verdict and 6 months after the Federal Circuit’s decision. But the Court recommended not awarding TT its fees because TT’s failure to promptly get the judgment corrected was the only reason there was a delay in paying the judgment.

Trial Counsel’s Opinion – Related Documents Are Discoverable

By R. David Donoghue on Posted in Discovery

Viskase v. World Pac, No. 09 C 5022, Slip Op. (N.D. Ill. Oct. 15, 2010) (Bucklo, J.).

Judge Bucklo granted defendants’ motion to reconsider, ordering production of the "Merritt Memo" previously held to be privileged because it included litigation counsel. The Court held that litigation counsel, before becoming litigation counsel, was the principal conduit to opinion counsel and his opinion was sought in connection with opinion counsel’s analysis. The Court, however, held that no post-filing communications were discoverable in light of In re Seagate which provided post-filing protection where a preliminary injunction was denied. 

Senator Durbin Assembles a Committee to Review Applicants for Northern District Judicial Vacancies

By R. David Donoghue on Posted in Legal News

Illinois’ senior senator, Dick Durbin, has announced a bipartisan screening committee to assist in filling the Northern District’s three vacant judgeships, as well as for future vacancies. If you are interested in applying for one of the vacant seats, click here to get an application from Senator Durbin’s website. The questionnaire portion of the application is similar to that used by the Senate Judiciary Committee in reviewing judicial appointments. Applications are due by Monday, January 31.

The screening committee will review the applications and make several recommendations for each open seat to Senator Durbin, who will work with Senator Kirk to propose nominees to President Obama. Members of the screening committee include (along with a portion of their respective bios from Senator Durbin’s website):

  • Dick Devine (chair). Mr. Devine was elected Cook County State’s Attorney in 1996 and served in that role until 2008. He currently is a partner at the law firm of Meckler Bulger Tilson Marick & Pearson LLP, where he leads the firm’s white-collar criminal defense and commercial litigation practices.
  • Demetrius Carney. Mr. Carney is a partner at the law firm of Perkins Coie. He is the president of the Chicago Police Board and a former commissioner for the City of Chicago’s Plan Commission.
  • Philip Corboy, Jr. Mr. Corboy is a partner at the law firm of Corboy & Demetrio. He is president of the Illinois Trial Lawyers Association, president of the board of directors of the Legal Assistance Foundation of Metropolitan Chicago, former board member of the Chicago Bar Association, and member of the dean’s council of DePaul University law school.
  • Kevin Forde. Mr. Forde has his own law practice in Chicago. He is a past president of the Chicago Bar Association, board chair of the Federal Defender Program in the Northern District of Illinois, counsel to the Federal Judges Association, and chair of the Illinois Compensation Review Board. He served as a law clerk to Judge William Campbell in the Northern District of Illinois.
  • Patricia Holmes. Ms. Holmes is a partner at the law firm of Schiff Hardin, where she heads the white collar crime group. She previously served as a former state trial judge, an Assistant U.S. Attorney for the Northern District of Illinois, an Assistant State’s Attorney for Cook County, and Chief Assistant Corporation Counsel for the City of Chicago.

    Betty Jang. Ms. Jang is legal counsel and director at CVS Caremark in Northbrook. Previously she served as senior counsel at the McDonald’s Corporation, a litigator at Hinshaw & Culbertson, an attorney with the Cook County Public Defender, and an adjunct professor at the University of Illinois law school.

    Paul Logli. Paul Logli is currently President and CEO of the United Way of Rock River Valley. He previously served for 21 years as the State’s Attorney for Winnebago County, and also served as a judge on the 17th Judicial Circuit Court.

  • Cheryl Niro. Ms. Niro is a principal in the law firm of RobinsonNiro PC. She previously served as past president of the Illinois State Bar Association, the Cook County Legal Assistance Foundation, and the National Caucus of State Bar Associations.
  • Michele Ruiz. Ms. Ruiz is a partner at the law firm of Sidley Austin. She was selected as a Leadership Greater Chicago fellow.
  • Diana White. Ms. White is the executive director of the Legal Assistance Foundation of Metropolitan Chicago, where she received the Equal Justice Award. Previously she was a partner at Jenner & Block and a law clerk to Judge Walter Cummings on the U.S. Court of Appeals for the 7th Circuit.

Contract Claims Sound in Copyright

By R. David Donoghue on Posted in Jurisdiction

Schrock v. Learning Curve Int’l, Inc., No. 04 C 6927, Slip Op. (N.D. Ill. Sep. 29, 2010) (Kocoras, J.)

Judge Kocoras denied defendant’s Fed. R. Civ. P. 12(b)(1) motion to dismiss for lack of subject matter jurisdiction and Rule 56 motion for summary judgment in this copyright and contract dispute involving photographs of Thomas & Friends characters – trains from the island of Sodor well-known to those like me with young children.

First, plaintiff’s claims sounded in copyright regardless of whether the Court used the "face of the complaint" test or the "principal and controlling issue" test both of which have been used by the Seventh Circuit. The complaint and the issues expressed in it made clear that copyrights were at the heart of the dispute. The Complaint alleged that plaintiff authored photographs and copyrighted them, entered an agreement with defendants, and that defendant’s use of the photographs violated the agreement.

Second, the Court denied summary judgment as to the contract claim because there was a question of material fact as to whether a binding agreement was formed between the parties and the Court held that in the event the trier of fact determined a valid contract exists, the agreement was not barred by the statute of frauds because plaintiff had fully performed his obligations pursuant to the agreement.

Trading Technologies: No Need for Jurisdictional Discovery Because Defendant Withdrew Its Motion to Dismiss

By R. David Donoghue on Posted in Jurisdiction

Trading Techs. Int’l, Inc. v. GL Consultants, Inc., No. 05 C 4120 & 5164, Slip Op. (N.D. Ill. Oct. 20, 2010) (Schenkier, Mag. J.).

Judge Schenkier denied plaintiff Trading Technologies’ ("TT") motion for jurisdictional discovery as moot because defendant GL Consultants withdrew its motion to dismiss. The Court also set an abbreviated process for filing the pending motion for a protective order. Click here for the procedures required of the parties before filing a discovery motion.

False Marking Plaintiffs’ Choice of Forum Given Little Deference

By R. David Donoghue on Posted in Jurisdiction

Simonian v. Monster Cable Prods., No. 10 C 1269, Slip Op. (N.D. Ill. Nov. 22, 2010) (Bucklo, J.).

Judge Bucklo granted defendant Monster Cable Products’ ("Monster") § 1404 motion to transfer this false patent marking case. Citing the Court’s decision transferring another of plaintiff Simonian’s false marking cases to Iowa in Simonian v. Pella. As in Pella, the qui tam plaintiff’s chosen forum was given little deference. And California was the situs of the events because that is where Monster designed the packaging at issue and made the alleged marking decisions. Also, all of Monster’s witnesses were located in California. The Court, therefore, transferred the case to the Northern District of California.

Seventh Circuit Rejects Zippo Sliding Scale for Personal Jurisdiction

By R. David Donoghue on Posted in Jurisdiction

Poulsen Roser A/S v. Jackson & Perkins Wholesale, Inc., No. 10 C 1894, Slip Op. (N.D. Ill. Nov. 15, 2010) (St. Eve, J.).

Judge St. Eve denied plaintiff Pousen Rosen’s ("Poulsen") Fed. R. Civ. P. 59(e) and 60(b) motion for reconsideration of the Court’s decision dismissing the case as to the individual defendants for lack of personal jurisdiction in this Lanham Act case.

First, "new evidence" in the form of the District of South Carolina Bankruptcy Court’s order consolidating the corporate defendants was irrelevant and did not alter the Court’s analysis. The Bankruptcy Court made no finding regarding the relationship between the corporate and individual defendants.

Second, the Court reconsidered and upheld its analysis regarding the corporate defendants’ internet contacts. The Seventh Circuit rejected the Zippo case’s sliding scale for internet-based jurisdiction because of the possibility of creating universal jurisdiction:

We note the legitimate concern that "[p]remising personal jurisdiction on the maintenance of a website, without requiring some level of "interactivity" between the defendant and consumers in the forum state, would create almost universal jurisdiction because of the virtually unlimited accessibility of websites across the country." Jennings, 383 F.3d at 550. Courts should be careful in resolving questions about personal jurisdiction involving on-line contacts to ensure that a defendant is not haled into court simply because the defendant owns or operates a website that is accessible in the forum state, even if that site is "interactive."

Illinois v. Hemi Group LLC,

__ F.3d __, 2010 WL 3547647, at *6 (7th Cir. 2010).

Local Patent Rules Do Not Apply to False Marking with Expired Patents

By R. David Donoghue on Posted in Local Rules

Zojo Sol’ns., Inc. v. Leviton Mfg. Co., No. 10 C 881, Slip Op. (N.D. Ill. Oct. 20, 2010) (Grady, Sen. J.).

Judge Grady granted defendant Leviton’s 28 U.S.C. § 1404(a) motion to transfer this false patent marking case to the Eastern District of New York. Plaintiff Zojo’s choice of forum was given little deference because Zojo was a qui tam plaintiff. The location of Leviton’s witnesses and documents in New York combined with the fact that Leviton’s New York headquarters was the situs for the alleged false marking, favored transfer. That was true even though the Eastern District of New York was a slightly faster court. The most interesting aspect of the decision, however, was a statement that the Local Patent Rules did not apply to false patent marking cases because patent infringement was not alleged. Presumably, the analysis is different if the alleged false marking involves a marked product that allegedly does not fall within the claims of the marked patent.

Northern District of Illinois 2010 IP Case Filings:

By R. David Donoghue on Posted in Legal News

The Northern District of Illinois continued its historically busy intellectual property docket in 2010.  The most interesting statistic is a huge jump in patent filings this year — 250 patent cases filed this year, nearly double 2009′s 137 filings.  And that is after a slight dip in filings from 2008 to 2009.  I will discuss the 2010 filings in more detail in a post later this month, but even correcting for false patent marking suits, not all of which are included in the 250 filings because plaintiffs did not uniformly identify false marking cases as patent cases on civil cover sheets filed with the complaints, there was a significant increase in patent filings.  That fits with my prediction in late 2008 that the Northern District’s new Local Patent Rules would drive cases to Chicago.*

Trademark cases continued their slow growth, showing a slight increase over 2009.  Finally, copyright cases increased, after falling off sharply in 2009.  This chart shows the number of yearly patent, trademark and copyright cases filed in the Northern District during calendar years 2006 through 2009 (data gathered from the Stanford IP Clearinghouse and Pacer):

Northern District IP Filings
Case Type 2006 2007 2008 2009 2010
Patent 126 141 151 137 250
Trademark 136 130 128 136 143
Copyright 194 123 81 41 4

*  Click here for much more on the Local Patent Rules in the Blog’s archives.