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Chicago IP Litigation Tracking Northern District of Illinois IP Cases

Monthly Archives: July 2011

In Forma Pauperis Status Denied Without Full Proof of Need

By R. David Donoghue on Posted in Federal Rules

Kim v. The Earthgrains Co., No. 01 C 3895, Slip Op. (N.D. Ill. Mar. 9, 2011) (Cox, Mag. J.).

Judge Cox denied plaintiff’s application for in forma pauperis ("IFP") status during its Federal Circuit appeal. The Court previously granted plaintiff’s IFP motion, until questions were raised regarding plaintiff’s real estate holdings. At that point, the Court rescinded the IFP status – there is more on that decision and this case generally in the Blog’s archives. Because the Court continued to have similar concerns regarding plaintiff’s property holdings, the Court denied IFP status.

Surviving – Prior Bankruptcy Does Not Preclude Pursuit of Music Royalties

By R. David Donoghue on Posted in Summary Judgment

Sullivan v. Jamison, No. 06 C 5240, Slip Op. (N.D. Ill. Mar. 8, 2011) (Coleman, J.).

Judge Coleman denied plaintiff’s motion for summary judgment that defendants’ counterclaims to music royalties from the group Survivor were stopped for failure to disclose them in bankruptcy petitions. In fact, both individual defendants had sufficiently identified their alleged rights to Survivor’s music royalties in their bankruptcy petitions or amendments thereto.

Parties Limited to One Binder of Trial Exhibits Per Side

By R. David Donoghue on Posted in Trial

Chamberlain Group v. Lear Corp., No. 05 C 3449, Slip Op. (N.D. Ill. Mar. 1, 2011) (Posner, J.).

Judge Posner, sitting by designation, ordered a series of pre-trial deadlines in this garage door opener patent case. The following deadlines were of particular note:

  • All objections to exhibits were to be in the form of motions in limine, not one-word objections.
  • Exhibits were limited to what could fit into one binder per side.
  • The Court was to draft jury instructions and voir dire.

“Consisting of” Language Determines Patent Summary Judgment

By R. David Donoghue on Posted in Summary Judgment

Kim v. The EarthGrain Co. k/n/a Sara Lee Bakery Group, Inc., No. 01 C 3895, Slip Op. (N.D. Ill. Feb. 4, 2011) (Cox, Mag. J).

Judge Cox construed the claims of plaintiff’s patent to compositions of a potassium bromide replacement for bread, and granted defendant Sara Lee summary judgment of noninfringement. Of particular note, the Court construed the following terms, all in Sara Lee’s favor:

  • "A potassium bromated replacer composition, consisting of" as:

a mixture of ingredients that acts to perform essentially the same function when used in the production of bread as would potassium bromated, namely, acting as a slow acting oxidant in the bread making process to strengthen the dough, increase loaf volume, and contribute to fine crumb grain. The mixture of ingredients is limited to the claimed ingredients (ascorbic acid, food acid, and flour) in the claimed amounts based on the weights of the ingredients. The mixture cannot contain additional chemical ingredients beyond those listed.

  • "Said food acid is present in an effective amount" as:

"Food acid" must be present in an amount that slows down the rate of oxidation of ascorbic acid to dehyroascorbic acid during a manufacturing process of bread.

  • "Said food acid selected from the group consisting of acetic acid . . . vinegar . . ." as:

the food acid can either be vinegar or acetic acid. "Vinegar" is a sour liquid used as a condiment or preservative that is obtained by acetic fermentation of dilute alcoholic liquids or of dilute distilled alcohol. "Acetic acid" is an organic acid represented by the chemical notation C2H2O2.

  • "Flour" as a "finely ground meal of wheat."

Having construed the claims, the Court held that Sara Lee’s accused products did not infringe the asserted patent:

  • The "consisting of" transitional phrase required that the claimed replacement could only have the claimed ingredients. But those ingredients could be mixed with other ingredients of the bread, as long as they were not part of the potassium bromide replacement.
  • Sara Lee’s products did not infringe because there was no evidence as to the amount of ascorbic acid in the accused bread. While a set amount was added in tablet form, the tablet would interact with water in the bread dough oxidizing the ascorbic acid and turning some of it into a non-infringing compound.
  • Five of the six accused products also did not infringe because they had more vinegar in them than the claimed range.

Suit Against Unidentified Defendants Was “Problematic” With Potential for “Abuse”

By R. David Donoghue on Posted in Pleading Requirements

CP Prods., Inc. v. Does 1-300, No. 10 C 6255, Slip Op. (N.D. Ill. Feb. 7, 2011) (Shadur, Sen. J.).

Judge Shadur dismissed this case without prejudice as to all defendants based upon plaintiff’s failure to serve any of the 300 Doe defendants within the required 120 days pursuant to Fed. R. Civ. P. 4(m). The Court also noted that it would be an "understatement" to call plaintiff’s copyright infringement claims against 300 unidentified defendants " problematic." The Court raised a concern that plaintiff’s use of a lawsuit to identify defendants "plainly has the potential to perpetrate the type of abuse" identified in various third party motions to quash.

Maps, Not Underlying Data, Warrant Copyright Protection

By R. David Donoghue on Posted in Legal News

The Nielsen Co. (US), LLC v. Truck Ads, LLC, No. 08 C 6446, Slip Op. (N.D. Ill. Jan. 24, 2011) (Pallmeyer, J.).

Judge Pallmeyer granted plaintiff Nielsen’s: 1) Fed. R. Civ. P. 12(b)(1) motion to dismiss defendant Truck Ads’ declaratory judgment claim for lack of copyright infringement; and 2) Fed. R. Civ. P. 56 motion for summary judgment regarding Truck Ads’ copyright misuse counterclaim in this copyright case regarding Nielsen’s designated marketing area ("DMA") maps.

While the Court held that any copyright claim to raw census data would be "frivolous," that was not Nielsen’s claim. Nielsen originally brought claims alleging infringement of its DMA regions and data, as well as the DMA maps. The current claims only accused infringement of the DMA maps. There was therefore, no case or controversy regarding the DMA regions or data. The Court also granted Nielsen summary judgment on Truck Ads’ copyright misuse claim. First, the Court held that counts were split on whether copyright misuse was a proper counterclaim, or an affirmative defense. But the Court did not have to decide the issue because Truck Ads could not prove that Nielsen’s claims were wholly lacking in merit. The DMA maps are original content that can warrant copyright protection, even though they may have been created based upon uncopyrighted data. And Nielsen’s allegation that Truck Ads’ alleged copying of the maps was unlawful was not frivolous, unsupported by law or clearly contradicted by record facts. Furthermore, Truck Ads offered no evidence that its alleged harm – a lost contract – was based upon Nielsen’s accusations or its merit.

N. D. Illinois 2011 Patent Trends

By R. David Donoghue on Posted in Local Rules

Several significant trends are developing as I read this year’s N. D Illinois patent decisions. The trends are largely, although not all, Chicago-specific. And they appear to be largely influenced by the not-so-new Local Patent Rules.

  1. Faster Settlement Times. Patent cases are settling faster. While the economy may still be playing a role, I believe that the LPR 2 initial contentions are driving early settlements. When parties take them seriously and make their best early cases, it is causing opponents to reconsider their positions and driving earlier settlements. Maybe more importantly, armed with more substantive analysis up-front, parties are talking more and more settlement discussions lead to more settlements. No doubt this is one of the impacts that the Court expected when it developed the LPR 2 initial contentions.
  2. False Patent Marking is Dying. In early 2010, the Northern District was among the top three districts for false patent marking filings, in particular those cases brought by marking trolls (non-competitors in the defendant’s industry). Unlike the Eastern District of Texas (which applied Rule 8 notice pleading to the intent requirement), the Northern District was split with many judges applying Rule 9 heightened pleading and a few applying Rule 8 notice pleading. That slowed the flow of cases to a degree, but what seems to have finished them is a combination of the Federal Circuit’s BP Lubricants decision (requiring Rule 9(b) pleading for the intent requirement) and a decision this spring holding that corporate intent was not recognized in the Seventh Circuit, so the required intent must be shown in at least one employee, officer or agent of the corporation.
  3. LR 56.1 Summary Judgment Decisions are on the Decline. There seem to be fewer decisions granting or denying summary judgment for failure to comply with the Local Rule 56.1 requirements for statements of material facts. Having tracked five years worth of intellectual property summary judgment decisions chastising parties for failure to comply with Local Rule 56.1, I cannot imagine that there is a trend toward strict compliance with Local Rule 56.1. Furthermore, this does not appear to be true in the trademark, copyright or trade secret realms. So, my suspicion is that this trend is really about fewer summary judgment decisions. And there are fewer summary judgment decisions for at least two reasons: 1) earlier settlement which avoids summary judgment motions; and 2) the Local Patent Rule 6.1 comment that judges have discretion to delay "early" summary judgment motions until the end of the discovery and the LPR 1.1 authority to delay motions raising claim construction issues until after the claim construction opinion issues.

Mutual Non-Compliance With Local Rule 56.1 Avoids Procedural Grant or Denial

By R. David Donoghue on Posted in Local Rules

Healix Infusion Therapy, Inc. v. HHI Infusion Servs., Inc., No. 10 C 3772, Slip Op. (N.D. Ill. Jan. 27, 2011) (Zagel, J.).

Judge Zagel denied plaintiff Healix’s motion for summary judgment as to defendant HHI’s alleged tortious interference and denied HHI’s motion to dismiss Healix’s tortious interference claim. The motion to dismiss was premised upon application of Washington law, but the Court held that Texas law applied and the claim was properly plead.

Regarding summary judgment, both parties "cried foul" as to the other’s Local Rule 56.1 compliance. The Court held that both parties were correct. But in light of the mutual non-compliance, the Court considered the substance of the motion, instead of resolving it on procedural grounds. Additionally, the Court held that emails offered as evidence were admissible over a hearsay objection as business records pursuant to FRE 803(6). Finally, the Court held that there was a question of fact as to whether HHI’s alleged interference was willful and intentional.

Staving Off Patent Trolls: Steps to Protect Your Company

By R. David Donoghue on Posted in Legal Seminars

On July 19, 2011 at noon central, I will be presenting a webinar for West, along with Thomas Dougherty, patent counsel for Gates Corp., and my colleague Mitchell Herbert of Holland & Knight.  We will be discussing how to deal with patent trolls, including direct steps for protecting your company and ways to limit your defense budget without harming your defense.  Registration is still available, and you can use the following special code to get 25% off of the $135 program fee:  0711LEC25.  And if you miss us on the 19th, you can purchase the recording of the presentation through the end of the year.

Passive Website Written in Chinese Does Not Create Illinois Personal Jurisdiction

By R. David Donoghue on Posted in Jurisdiction

Labtest Int’l., Inc., d/b/a Intertek Consumer Goods N. Am. v. Centre Testing Int’l. Corp., No. 10C2897, Slip Op. (N.D. Ill. Feb. 1, 2011) (Dow, J.).

Judge Dow granted defendant CTI’s Fed. R. Civ. P. 12(b)(2) motion to dismiss for lack of personal jurisdiction in this copyright infringement action. The Court did not have jurisdiction over CTI:

  • CTI was a Chinese entity with no U.S. offices.
  • CTI’s only possible contact with Illinois regarding the copyrighted subject matter was via its passive website.
  • Plaintiff Intertek offered no proof that anyone from Illinois downloaded the allegedly infringing chart.
  • CTI’s only connection was work in China for an entity with a parent entity in Illinois.

The Court did not award Intertek its fees and costs for defending the case or the case filed by Intertek in Connecticut. Intertek had credible arguments for each, and it was not forum shopping even if the arguments were eventually proven wrong.

Court Severs 800 Doe Defendants in Copyright Suit

By R. David Donoghue on Posted in Jurisdiction

Millennium TGA, Inc. v. Does 1-800, No. 10 C 5603, Slip Op. (N.D. Ill. Nov. 30, 2010) (Manning, J.).

Judge Manning sua sponte severed each Doe defendant in this copyright suit over alleged use of copyrighted materials via BitTorrent, except for one Doe IP address. And the Court granted that Doe’s motion to quash the subpoena.

The Court previously granted plaintiff leave to subpoena Internet Service Providers ("ISP") to obtain identities associated with certain IP addresses – unique strings of numbers that can often be associated with a single computer or location. Plaintiff had met the Fed. R. Civ. P. 20(a)(2)(A) joinder requirements because it could not show that the Does acted in concert. Furthermore, the case in its current position could leave the Court with dozens or hundreds of factually unique motion to dismiss, quash or sever. And there was no indication that venue was proper. Plaintiff had no connection to Illinois, and it was not clear that any Doe did either.

Stayed Patent Claims in One Case Do Not Remove Value of Consolidating Similar Cases

By R. David Donoghue on Posted in Local Rules

Pactiv Corp. v. Multisorb Techs., Inc., No. 10 C 461, Slip Op. (N.D. Ill. Feb. 15, 2011) (Leinenweber, Sen. J.).

Judge Leinenweber granted defendant Multisorb Technologies’ Fed. R. Civ. P. 42 motion to consolidate a later-filed and related patent case before Judge Dow with the instant case. While the two cases asserted different patents, both cases accused Multisorb’s FreshPax CR device for creating low-oxygen packaging. And several of the patents claimed the same priority. Additionally, the two complaints used virtually identical language. And the fact that plaintiff Pactiv’s patent claims in the first suit were stayed pending reexam did not matter. Regardless of the timing of decisions, having two separate cases would still subject the parties to inconsistent rulings.

And transfer of the later-filed case was warranted to Local Rule 40.4. Both cases involved the same accused product. While the stay of Pactiv’s patent claims in the first suit complicated matters, it did not mitigate the value of consolidating and reassigning the cases before a single judge.

Infringement Claims Against Corporate Officers Require Active Participation

By R. David Donoghue on Posted in Pleading Requirements

Free Green Can, LLC v. Green Recycling Enters., LLC, No. 10 C 5764, Slip Op. (N.D. Ill. Jan. 28, 2011 (Coleman, J.).

Judge Coleman granted the individual defendants’ and Aslan Financial Group’s Fed. R. Civ. P. 12(b) motion to dismiss plaintiff Free Green Can’s trademark infringement and related state law claims. As an initial matter, the Court lacked subject matter jurisdiction as to all state law claims because while Free Green Can pled diversity of citizenship, it did not plead that the amount in controversy exceeded $75,000. Because Aslan Financial Group was only accused of state law claims, it was dismissed.

The federal trademark claims against the individual defendants were dismissed pursuant to Fed. R. Civ. P. 12(b)(6) because the individual defendants were accused of infringement based upon corporate acts of defendant Green Recycling Enterprises, of which each was an officer. But in order to state a claim for infringement, or any tort, by corporate officers or employees Free Green Can was required to allege each individual defendant had actively participated in the tortious acts. Because there were no such allegations, the infringement claims were dismissed.