Chicago IP Attorney & Lawyer : R. David Donoghue : Chicago IP Litigation Blog

ArrivalStar S.A. v. Geo-Comm, Inc., No. 11 C 5016, Slip Op. (N.D. Ill. Jul. 27, 2011) (Shadur, Sen. J.).

Judge Shadur sua sponte challenged the sufficiency of plaintiff ArrivalStar's venue allegations. Venue is proper in patent cares: 1) where the defendant resides; or 2) where the defendant allegedly committed the accused acts and had a regular place of business. Geo-Comm resided in Minnesota. So, only the second option was possible. ArrivalStar did plead that Geo-Comm sold accused products in the district. But ArrivalStar failed to plead that Geo-Comm had a regular and established place of business in the district. Instead of requiring immediate repleading or briefing, the Court set a status conference to discuss the issue.
 

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Revenue Realization LLC v. H&R Block, Inc., No. 11 C 85, Slip Op. (N.D. Ill. Apr. 11, 2011) (Shadur, Sen. J.).

Judge Shadur granted defendant H&R Block's motion to dismiss, after granting plaintiff Revenue Realization leave to file its response to the motion and fully considering it. Revenue Realization accused H&R Block of patent infringement. H&R Block moved to dismiss because it was a passive holding company for a variety of subsidiaries and, therefore, was not the proper H&R Block defendant.

H&R Block offered to identify the proper entities for Revenue Realization. But Revenue Realization refused the offer, as well as the Court's suggestion that it file against all possible subsidiaries and narrow the defendants based upon the entities' subsequent motions to dismiss. Instead Revenue Realization argued that the Federal Circuit's decision in Nuance Commc'ns, Inc. v. Abbyy Software House, 626 F.3d 1222 (Fed. Cir. 2010) confirmed that the Court had jurisdiction over a passive parent entity in patent cases. The Court, however, held that the opinion stood for quite a different proposition and was a "weak reed to lean on." In fact, Nuance dealt with a subsidiary entity that had direct contacts with the forum. In contrast, H&R Block was a true holding company. And the fact that H&R Block defined itself as including its subsidiaries in certain SEC filings was irrelevant to the Court's analysis.

The Court finished the opinion referring to the New Yorker's old practice of filling the final page of an article that otherwise would have left a portion blank with a section captioned "Department of Clotted Nonsense" containing amusing quotations and reprinted errors from other publications. The Court then granted plaintiff leave to file its response brief, and noted that the Court had already fully considered it.
 

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Boy Racer, Inc. v. Does 1-22, No. 11 C 2984, Slip Op. (N.D. Ill. May 9, 2011) (Shadur, Sen. J.).

Judge Shadur sua sponte dismissed plaintiff Boy Racer's copyright infringement complaint without prejudice. The Court held that Boy Racer could not "shoot first and identify [its] targets later" by suing twenty-two Doe defendants. Instead, Boy Racer was free to file its suits against identifiable individuals.
 

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Estwing Manufacturing Co. v. CTT Tools, Inc., No. 11 C 2139, Slip Op. (N.D. Ill. May 18, 2011) (Shadur, Sen. J.).

Judge Shadur entered this order sua sponte to address deficiencies in defendant CTT's answer, affirmative defenses and counterclaims in this Lanham Act case, as he often does. First, CTT denied plaintiff Estwing's claims for which CTT lacked information or belief. But the Court noted that denying a statement for which one lacks information or belief was "oxymoronic." The Court, therefore, struck the denials.

The Court also struck, with leave to replead, each of CTT's affirmative defenses that were mere recitations of a legal principle and did not put Estwing or the Court on notice of the defense, as well as those defenses which did not accept the truth of Estwing's allegations.

Finally, the Court also struck CTT's counterclaims with leave to replead those that were not simply the "flip side" of Estwing's complaint, which "add nothing to the mix." For example, the Court suggested that CTT's counterclaim for cancellation of Estwing's mark might be replead, while declaratory judgment claims for noninfringement and invalidity should not be. Finally, the Court ordered that CTT should not be charged for its counsel's efforts in revising the papers, and counsel should send a letter to that effect to CTT, copying the Court.

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Optics Plantet, Inc. v. OpticSale, Inc., No. 09 C 7934, Slip Op. (N.D. Ill. Mar. 7, 2011) (Shadur, Sen. J.).

Judge Shadur denied defendants' (collectively "AKYR") motion to delay the contempt proceedings against it in this Lanham Act case. AKYR had failed to post a court ordered disclaimer for about eight months, and the Seventh Circuit denied AKYR mandamus relief. The Court, therefore, ordered that the parties appear to quantify the fee-shifting required to address AKYR's delay pursuant to 28 U.S.C. § 1927, and to discuss whether additional sanctions where warranted.
 

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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.
 

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Bernina of Am., v. Imageline, Inc., No. 10 C 4917, Slip Op. (N.D. Ill. Jan. 18, 2011) (Shadur, Sen. J).

Judge Shadur sua sponte ordered defendant to correct its answer. Two paragraphs stated that defendant lacked information and belief sufficient to answer and, based upon that, denied the contentions. The Court explained that denying a contention for which one lacked information and belief was "oxymoronic." The Court gave defendant time to file a paper removing the relevant denials.
 

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Trading Technologies Int'l, Inc. v. CQG, Inc., No. 10 C 718, Slip Op. (N.D. Ill. Jan. 24, 2011) (Shadur, Sen. J.).*

Judge Shadur sua sponte dismissed defendants' (collectively "CQG") noninfringement and invalidity counterclaims. The Court explained that "mirror image" noninfringement and invalidity patent counterclaims are "seemingly meaningless." And the "amorphous nature" of CQG's counterclaims resulted in them being especially unnecessary. The Court, therefore, dismissed the declaratory judgment counterclaims.

*Click here for much more on this and TT's other cases in the Blog's archives.
 

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Bernina of Am., Inc. v. Imageline, Inc., No. 10 C 4917, Slip Op. (N.D. Ill. Jan. 12, 2011) (Shadur, Sen. J.).

Judge Shadur sua sponte struck two paragraphs of plaintiff's answer and affirmative defenses to defendants' counterclaims. Both paragraphs denied allegations for which plaintiff lacked information and belief, which was both "oxymoronic" and in violation of Fed. R. Civ. P. 8(b)(5).
 

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Trading Techs. Int'l., Inc. v. CQG, Inc., No. 10 C 718, Slip Op. (N.D. Ill. Jan. 6, 2011) (Shadur, Sen. J.).

Judge Shadur denied plaintiff Trading Technologies' ("TT") motion to strike certain of defendants' (collectively "CQG") affirmative defenses and counterclaims.* The motion was originally filed September 1, 2010 and had been stayed by agreement as the parties attempted to negotiate a global settlement. Because allowing motions to lie "fallow" for so long was "undesirable" the Court dismissed the motion with leave to refile it should the parties restart the substantive portion of the case.

*  Click here for much more on this and the related Trading Technologies cases in the Blog's archives.
 

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CP Prods., Inc. v. Does 1-300, No. 10 C 6255, Slip Op. (N.D. Ill. Dec. 29, 2010) (Shadur, Sen. J.).

Judge Shadur dismissed defendant Doe 300's motion to quash a subpoena in this copyright case, for numerous failures to comply with the Local Rules: 1) failure to provide a courtesy copy to chambers; 2) failure to notice the motion; and 3) failure to seek leave to appear pro hac vice. The Court, however, did not fine counsel for the violations because she was an out-of-state lawyer.

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JAB Distribs., LLC v. Martha Stewart Living Omnimedia, Inc., No. 10 C 5716, Slip Op. (N.D. Ill. Oct. 26, 2010) (Shadur, Sen. J.).

Judge Shadur sua sponte struck plaintiff JAB's reply to defendant Martha Stewart Living's counterclaims. The reply failed to comply with Local Rule 10.1, requiring that an answer repeat the contention before responding to it. Additionally, JAB was ordered not to deny statements for which it lacked information and belief; as denying something about which one lacks sufficient information is "oxymoronic."
 

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Bernina J. Am. v. Imageline, Inc., No. 10 C 4917, Slip Op. (N.D. Ill. Nov. 18, 2010) (Shadur, Sen. J.).

Judge Shadur sua sponte issued an order regarding defendants' answer. The Court dismissed affirmative defenses that were impermissibly inconsistent with the allegations in the Complaint. The Court also ordered defendants to present jurisdictional and Rule 12(b) defenses as motions, rather than conclusory affirmative defenses.
 

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Midtronics, Inc. v. Aurora Performance Prods., LLC, No. 06 C 3917, Slip Op. (N.D. Ill. Oct. 14, 2010) (Shadur, Sen. J.).

Judge Schadur granted plaintiff Midtronics' motion in limine to exclude defendants' expert submission offered after entry of the parties' Final Pretrial Order. Defendants argued their submissions were timely pursuant to Fed. R. Civ. P. 26(a)(2)(D)(1) because they were served more than ninety days before trial. But the Court noted that Rule 26(a)(2)(D)(1) is an alternative rule that was preempted by entry of the Final Pretrial Order, and by the close discovery before that.

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Ashley Furniture Indus., Inc. v. Value City Furniture, Inc., No. 10 C 5413, Slip Op. (N.D. Ill. Sep. 27, 2010) (Shadur, Sen. J.).

Nothing that his opinion was styled "Memorandum" and not "Memorandum Order," Judge Shadur questioned the viability of plaintiff Ashley Furniture's trademark infringement, false designation of origin and dilution claims. The Court opined that "no rational reader" could find that defendant Value City's accused advertising violated Ashley Furniture's trademarks or that Value City's "accurate" use of Ashley Marks' infringed the marks. The Court, however, did not strike the claims sua sponte. The Court also noted that, even if the "troublesome" claims were eliminated, Ashley Furniture's Lanham Act unfair competition claims would still survive.

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Ashley Furniture Indus., Inc. v. Value City Furniture, Inc., No. 10 C 5413, Slip Op. (N.D. Ill. Aug. 31, 2010) (Shadur, Sen. J.).

Judge Shadur sua sponte ordered plaintiff Ashley Furniture to submit a brief memorandum citing the principal cases supporting Ashley Furniture's trademark infringement claims based upon Value City Furniture's "aggressive competitive advertising" including the use of Ashley Furniture's trademark. The memorandum would help facilitate addressing the case at the Court's initial status conference. The Court also noted that while the use of a competitor's name in advertising was once verboten, it is now ubiquitous.

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Optics Planet, Inc. v. OpticSale, Inc., No. 09 C 7934, Slip Op. (N.D. Ill. Jul. 14, 2010) (Shadur, Sen. J.).

The Court granted in part Plaintiff Optics Planet's Fed. R. Civ. P. 12(b)(6) motion to dismiss. Initially, the Court noted that defendants' tortious interference with prospective business relationships and with prospective economic advantage were not separate counts, but at most separate theories of recovery for a single court, calling the claims "Tweedledum and Tweedledee."

But the claims, whether single or multiple counts did not survive the competitor's privilege. Defendants offered no evidence showing that plaintiff was doing anything except "feathering its own competitive nest". Defendants' attempted monopolization claims were also dismissed because there was no evidence that plaintiff did anything but compete, and there was no indication that plaintiff would or could acquire power over market pricing.

Finally, the Court dismissed defendant's accounting counterclaim to the extent the claim was based upon the dismissed counterclaims.

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McNamara v. Natural Organics, Inc., No. 10 C 3544, Slip Op. (N.D. Ill. Sep. 1, 2010) (Shadur, Sen. J.).

Judge Shadur denied defendant's motion to stay this false patent marking case pending the Federal Circuit's standing decision in Stauffer (Stauffer has since been decided). The Court also dismissed plaintiff's second amended complaint for failure to plead the requisite intent to deceive pursuant to Fed. R. Civ. P. 9(b) heightened pleading standards. Plaintiff attempted to plead intent upon information and belief using a nine-year-old statement made on defendant's behalf about its skilled legal representative in an FTC proceeding. But that quoted language referred to a lawyer who was deceased, and he had passed away even before the FTC proceeding. Because plaintiff had already been given two chances to replead, the Court dismissed the case.
 

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Simonian v. Merck & Co., Inc., No. 10 C 1297, Slip Op. (N.D. Ill. Jul. 16, 2010) (Shadur, Sen. J.).

Judge Shadur sua sponte struck portions of defendants' answer to plaintiff's false patent marking case. First, the Court struck denials that followed defendants' statements that they lacked information and belief. While a lack of information and belief acts as a denial, denying allegations as to which you cannot form a belief is "oxymoronic."

Second, the Court struck defendants' improper affirmative defenses. Several of defendants' affirmative defenses were improper because they had already been brought into issue by denying allegations in the complaint. The Court also struck defendants' Fed. R. Civ. P. 12(b)(6) affirmative defense with leave to promptly file a "properly supported" motion to dismiss.
 

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OpticsPlanet, Inc. v. OpticSale, Inc., No. 09 C 7934, Slip Op. (N.D. Ill. Jul. 14, 2010) (Shadur, Sen. J.).

Judge Shadur granted in part plaintiff OpticsPlanet's Rule 12(b)(6) motion to dismiss certain of defendants' (collectively "OpticSale") counterclaims in this dispute over trade names. As an initial matter, the Court noted that OpticSale's tortious interference with prospective business relationships and with prospective economic advantage claims were properly brought as a single federal claim pursuant to Fed. R. Civ. P. 10(b). Furthermore, both counts failed at the hands of the competitor's privilege. Businesses are free to compete to divert business from their competitors unless, among other exceptions, the competition is solely motivated by spite or ill will. OpticSale made no such allegation in this case. And the Court noted that OpticSale had competed with OpticsPlanet in similar ways. 

The Court also dismissed OpticSale's Sherman Act attempted monopolization claim because there was no indication that OpticsPlanet controlled or could come to control market prices. The Court further noted that the claim improperly sought to turn competition into attempted monopolization.

Finally, the Court dismissed OpticSale's accounting claim to the extent its scope was reduced by dismissal of the other claims.

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Shop-Vac Corp. v. Alton Indus. Ltd Group, No. 10 C 1066, Slip Op. (N.D. Ill. Jun. 7, 2010) (Shadur, J.).

Judge Shadur sua sponte dismissed several of plaintiff Shop-Vac's affirmative defenses in response to defendant Alton's counterclaims as inappropriate, citing the Court's decision in State Farm Mut. Auto Ins. Co. v. Riley, 199 F.R.D. 276 (N.D. Ill. 2001). The Court dismissed one affirmative defense which was the equivalent of a Fed. R. Civ. P. 12(b)(6) challenge to the sufficiency of Alton's counterclaims.

The Court also dismissed two affirmative defenses that were proper pursuant to Fed. R. Civ. P. 8(c), but were not pled with sufficient facts. Shop-Vac was given leave to reassert them with additional supporting facts. The Court also dismissed two affirmative defenses that contradicted allegations in the counterclaim. Shop-Vac put those issues in contention by denying the facts.  

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Be2, LLC v. Be2.net, No. 10 C 1650, Slip Op. (N.D. Ill. Jul. 12, 2010) (Shadur, Sen., J.).

Judge Shadur denied the individual defendant's letter request to alter the Court's default judgment. The Court attached the letter to the opinion to avoid any concerns that the defendant's communications were ex parte. And the Court left the judgment intact because the defendant's explanation did not warrant alteration or vacatur of the judgment.

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Simonian v. Merck & Co., No. 10 C 1297, Slip Op. (N.D. Ill. June 1, 2010) (Shadur, Sen. J.).

In response to defendant Merck's motion to dismiss plaintiff's false patent marking action, the Court sent a copy of its prior decision in Zojo Solutions, Inc. v. The Stanley Works, No. 10 C 1174, Slip Op. (N.D. Ill. May 12, 2010) (Shadur, Sen. J.). In that case, the Court held that marking with expired patents was actionable and that an individual citizen could bring a false marking action pursuant to 35 U.S.C. § 292. The Court ordered the parties to appear on the notice date to discuss the course of the litigation.

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Zojo Solutions, Inc. v. The Stanley Works,No. 10 C 1175, Slip Op. (N.D. Ill. May 12, 2010) (Shadur, Sen. J.).

Judge Shadur denied defendants' motion to dismiss this false patent marking case before plaintiff responded. First, the Court held that marking with expired patents was actionable pursuant to 35 U.S.C. § 292(a), citing Forest Group, Inc. v. Bon Tool Corp., 590 3d 1295 (Fed. Cir. 2009). Also citing Forest Group, the Court held that private citizens had standing. The Court reasoned that if there was not standing, the Federal Circuit would have been obligated to address it before deciding the substantive issues. Finally, the Court characterized false patent marking cases as an "infestation of dandelions" which "dot the greensward of patent litigation." 

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Billingnetwork Patent, Inc. v. Avisena, Inc., No. 09 C 8002, Slip Op. (N.D. Ill. Jan. 4, 2010) (Shadur, Sen. J.).

Judge Shadur sua sponte ordered plaintiff to dismiss and refile against four of the five unrelated defendants in this patent infringement suit. The Court also instructed that the cases should not be refiled as previously dismissed cases such that they would be reassigned to the Court. And the plaintiff should not move for reassignment as a related case pursuant to Local Rule 40.4. The Court, however, noted that it would be open to reciprocal orders allowing concurrent discovery in each of the five cases.

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Continental Datalabel, Inc. v. Avery Dennison Corp., No. 09 C 5980, Slip. Op. (N.D. Ill. Dec. 9, 2009 (Shadur, Sen. J.).

Judge Shadur ordered the parties to be prepared to discuss at a status conference why defendants' respective noninfringement and invalidity declaratory judgment counterclaims should not be stricken as duplicative of plaintiff's patent infringement claims. 

* Click here for more on this case in the Blog's archives.

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Continental Datalabel, Inc. v. Avery Dennison Corp., No. 09 C 5980, Slip Op. (N.D. Ill. Nov. 19, 2009) (Shadur,  J., Sen.).

Judge Shadur sua sponte notified the parties to be prepared to discuss plaintiff Continental Datalabels' (“CDL”) addition of defendant Memorex in this patent infringement and Lanham Act dispute.  CDL added Memorex by amending CDL’s complaint pursuant to Fed. R. Civ. P. 15(a) of right, before the original defendant Avery Dennison Corp. (“ADC”) answered.  The Court noted that Memorex’s and ADC’s accused products appeared to be unrelated.  The infringement proofs, therefore, were unlikely to have much overlap, although the invalidity cases would likely have commonality.  

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Ratner v. M&M Control Serv., Inc., No. 08 C 6928, Slip Op. (N.D. Ill. Jan. 5, 2009) (Shadur, Sen. J.).

Judge Shadur ordered that certain denials in patent defendant's answers be stricken pursuant to Fed. R. Civ. P. 8(b)(5) and 11 (b).  The Court held that when a defendant lacked sufficient knowledge to answer an allegation and so stated, it was deemed a denial pursuant to Rule 8(b)(5).  But defendant cannot actually deny the allegation because defendant has already stated that it lacks sufficient knowledge to admit or deny the allegation.  As such, denying the allegation conflicts with Rule 11(b) obligations.

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Freightquote.com, Inc. v. Air Ocean Land Sol'ns., Inc., No. 98 C 346, Slip Op. (N.D. Ill. Jan. 26, 2009) (Shadur, Sen. J.).

Judge Shadur issued this Memorandum questioning whether plaintiff's trademark infringement and related state law claims should have been brought in the Northern District.  The complaint listed the parties' citizenship as being in Delaware, Kansas, North Carolina and Texas.  The lack of an Illinois resident or citizen in the case caused the Court to question whether the Northern District was the appropriate location for the suit.  The Court did not rule upon the issue, but directed the parties to be prepared to discuss whether the Northern District was the appropriate forum for the case at the next hearing.

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Consumers Digest Comms., LLC v. Westpoint Home, Inc., No. 08 C 3486, Slip Op. (N.D. Ill. Dec. 9, 2008) (Shadur, Sen. J.).

Plaintiff filed an amended complaint including a copyright claim, after Judge Shadur orally granted defendant's motion to dismiss its original copyright and related state law claims.  The Court noted that the amended complaint did not include a copy of the allegedly infringing publications as exhibits.  The Court, therefore, ordered plaintiff to deliver copies of the allegedly infringing publications to the Court and defendant's counsel. 

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The TicketRESERVE, Inc. v. Viagogo, Inc., No. 08 C 5202, Slip Op. (N.D. Ill. Nov. 19, 2008) (Shadur, Sen. J.).*

Judge Shadur ordered that plaintiff's amended complaint was entered without need for plaintiff's motion for leave to file the amended complaint.  While defendant Yoonew had already answered the complaint, the amendment added a party that appeared related to defendant Viagogo, which had filed a motion to dismiss instead of answering.  The Court held that plaintiff's Fed. R. Civ. P. 15(a)(1)(A) absolute right to amend its complaint before it is answered was not destroyed as to a particular defendant until that defendant answers.  So, plaintiff was free to amend any claims made against Viagogo until Viagogo answered, but presumably would have to seek leave to amend should the amendments impact defendant Yoonew.

*  This case is assigned to Judge Moran, but during Judge Moran's absence from the bench Judge Shadur has taken over his docket.

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Idex Corp. v. Dripping Wet Water, Inc., No. 08 C 1114, 2008 WL 4372038 (N.D. Ill. Feb. 26, 2008) (Shadur, Sen. J.).

Judge Shadur sua sponte gave plaintiffs one week to amend their pleadings to resolve potential subject matter jurisdiction issues.  The Court noted that the breach of a patent settlement did not create federal question jurisdiction because the agreement was about a patent.  And the Court held that it was not sufficient for diversity jurisdiction just to plead the parties' residences.  Both residence and citizenship must be pled for the purposes of diversity jurisdiction.  The Court, therefore, ordered plaintiffs to amend their complaint to plead both residence and citizenship, or otherwise prove jurisdiction.  The Court also ordered plaintiffs to explain why the case was filed in the Northern District rather than in Texas where the parties had an ongoing suit or Connecticut where the litigation resulting in the settlement at issue took place.

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Hyperquest, Inc. v. N’Site Solutions, Inc., No. 08 C 483, 2008 WL 3978310 (N.D. Ill. Aug. 22, 2008) (Shadur, Sen. J.)

Judge Shadur continued defendants’ motion for fees as a prevailing party in this copyright case pursuant to 17 U.S.C. §505, after previously requiring additional briefing as to the reasonableness of defendants’ requested fees – click here to read about that opinion in the Blog’s archives. Defendants collectively requested approximately $260K in fees. The Court dismissed plaintiff’s argument that defendants did not offer proof that defendants had paid their counsels’ fees. But the Court set a hearing to discuss an appropriate award, noting that plaintiff’s counsel’s fees, approximately $110K, were a more appropriate sum, with some adjustment for the fact that there were two defendants.

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Midtronics, Inc. v. Aurora Performance Prods. LLC, No. 06 C 3917, 2008 WL 2745941, (N.D. Ill., Jul. 11, 2008) (Shadur, Sen. J.).

Judge Shadur construed the disputed terms of plaintiffs’ electronic battery tester patent. The patent taught a form of “dynamic” battery testing and each disputed term revolved around the meaning of “dynamic.” The Court adopted plaintiffs’ definition – varying over time – without limiting dynamic to require an AC current (a current that varies regularly over time). The Court held that requiring an AC current was an unnecessary limitation. Not all currents that vary over time are AC, and requiring an AC current would have read a preferred embodiment out of the claims.

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HyperQuest, Inc. v. N'Site Solutions, Inc., No. 08 C 483, 2008 WL 1968554 (N.D. Ill. May 1, 2008) (Shadur, Sen. J.).

Judge Shadur dismissed plaintiff's copyright infringement case for lack of subject matter jurisdiction. Plaintiff argued that it was the exclusive licensee of the copyright. But the Court held that plaintiff's license was nonexclusive because licensor retained various rights, including, the rights to:

• Make derivative works;
  
• Reproduce the work; and
  
• Sell the copyrighted software.

But the Court's adoption of defendants' reply was its most notable feature:

To that end [defendants’] Reply addressed fully every aspect of [plaintiff’s] attempt to characterize itself as an exclusive licensee . . . and it completely scotched HQ's position. Because the Reply has covered the waterfront so thoroughly and persuasively, this Court finds it unnecessary to reiterate the analysis there piece by piece-instead it simply adopts [defendants’] presentation as proffered in the Reply.

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Judge Shadur, on the Court's own motion, struck the portions of defendant Biorigin's Answer that denied plaintiff's claims because plaintiff misspelled Biorigin – spelling it “Biorgin” instead of “Biorigin.” The Court noted that a denial based upon misspelling was an argument “only a patent lawyer could love.” And the Court explained that, despite plaintiff's misspelling, Biorigin understood that it was the intended target of plaintiff's complaint.

The Court also struck Biorigin's lack of personal jurisdiction, insufficient service and insufficient process affirmative defenses. The Court held that by filing a counterclaim, Biorigin affirmatively invoked the Court's jurisdiction, forfeiting these affirmative defenses.

As to Biorigin's lack of standing affirmative defense, the Court noted that it was pled on information and belief and required that Biorigin, should it find facts to support its defense, file a motion with such facts as quickly as possible because standing should be addressed as early as possible.

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Blawg Review #150 is up at Trust Matters by Charlie Green, co-author of The Trusted Advisor and creator of the Carnival of Trust, which I will be hosting on the first Monday of May.  This week's review links to the Blog's follow-up post about whether photographs of copyrighted Thomas & Friends toy trains are derivative works -- click here for the post.

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Schrock v. Learning Curve Int’l, Inc., No. 04 C 6927, __ F.Supp.2d __ (N.D. Ill. Jan. 29, 2008) (Shadur, J.).*

In February, I posted about Judge Shadur's opinion in this case holding that plaintiff's photographs of defendants' copyright Thomas & Friends toy trains were derivative works and, therefore, could not be registered with the Copyright Office without defendants' express permission -- click here for the post.  Professor Rebecca Tushnet of my alma mater, the Georgetown University Law Center, at the 43(B)log has posted about the case also.  Tushnet questions why the creator of an authorized derivative work should be prevented from registering that work:

What I don’t understand is why authority to register ought to matter. The derivative works – accepting for the moment that this is what they were – were made with the permission of the copyright owner in the original works. That is all that ought to be required. Of course there is a potential problem of blocking copyrights – but other cases have avoided this by finding no derivative work at all where a translation from two dimensions to three, or three to two, has taken place.

It does seem reasonable that the authorized creator of a derivative work should have the right to register the copyright, leaving any rights held by the underlying copyright owner to be controlled by contract.  Of course, requiring that the right to register be expressly granted also leaves the rights to the contract between the parties, just with a different default.

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Schrock v. Learning Curve Int’l, Inc., No. 04 C 6927, Slip Op. (N.D. Ill. Jan. 29, 2008) (Shadur, J.).*

Judge Shadur granted defendants’ motion for summary judgment of non-infringement and dismissed plaintiff’s related state law claims. Plaintiff took a series of photographs of defendants’ Thomas & Friend toy trains, each pursuant to a provision that defendants could only use the photographs for two years. Plaintiff argued that defendants infringed plaintiff’s copyrights by using the photographs after the two years were up. 

But the Court held that plaintiff had no copyright. The photographs were derivative works based upon defendant’s copyrighted Thomas & Friends train engines and cars. The party making a derivative work must have the copyright holder’s permission to copyright the derivative work. While plaintiff had the right to make the derivative works, plaintiff was not granted the right to copyright them. Plaintiff, therefore, had no copyright. And because plaintiff’s state law claims were based on supplemental jurisdiction, they were dismissed without prejudice.

The Court also noted that President Abraham Lincoln, a month before his assassination, signed the bill making photographs copyrightable for the first time.

*  Click here for a copy of the opinion.

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Garcia v. City of Chicago, No. 07 C 5828, Slip Op. (N.D. Ill. Dec. 10, 2007) (Shadur, J.).

Judge Shadur sua sponte struck certain denials in defendant’s answer. The Court held that it was improper to deny those allegations for which defendant stated it lacked sufficient information or belief to respond and, therefore, struck them from the answer. Additionally, the Court noted that defendants had not provided the Court with courtesy copies pursuant to Local Rule 5.2(e).

Practice tip: Courtesy copies often get lost in the administrative shuffle after a complex filing. But there are few things more important than providing the Court with easy access to your papers.

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Dicam, Inc. v. United States Cellular Corp., No. 07 C 5472, Slip. Op. (N.D. Ill. Sep. 28, 2007) (Shadur, J.).*

Judge Shadur sua sponte ordered plaintiff Dicam to dismiss all parties but defendant United States Cellular (“U.S. Cellular”) and one of its five co-defendants. Dicam’s Complaint alleged patent infringement of telephones sold by U.S. Cellular and manufactured by the other five defendants. The Court could find “no legitimate reason” for brining what it believed were five separate suits as one. The Court explained that if Dicam had filed the suits separately, the Court would not have consolidated them pursuant to Local Rule 40.4, although they might have qualified for coordinated discovery. The Court, therefore, ordered Dicam to dismiss four of the five suppliers, without prejudice to refile separate cases against those suppliers. Dicam has since dismissed all but one of the four suppliers and refiled separate cases against each of the four suppliers with U.S. Cellular named as a co-defendant in each case.

* Click here for a copy of the opinion.

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Meyer Intellectual Props. Ltd. V. Bodum, Inc., __ F.Supp.2d __, 2007 WL 2110931 (N.D. Ill. Jul. 24, 2007) (Shadur, J.).

Judge Shadur granted plaintiff’s motion for attorneys’ fees and costs related to a motion discovery dispute won by plaintiff, but modified its original award based upon defendant’s explanations (you can read more about this case in the Blog’s archives). The Court explained that the relevant Federal Rule, Fed. R. Civ. P. 37(a)(4)(A), could be paraphrased as “loser pays,” unless the Court finds the losing parties actions or lack of actions were justified or that other circumstances make a fee award unjust. The Court held that defendant’s explanation warranted reducing the original award by 50%. While the Court did not detail the explanation, this case identifies the broad discretion courts have in determining whether to award attorneys’ fees and costs, as well as the size of those awards.

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Meyer Intellectual Props. Ltd. V. Bodum, Inc., No. 06 C 6329, Slip Op. (N.D. Ill. Jul. 24, 2007) (Shadur, J.).*

Judge Shadur denied defendant’s motion to amend its answer adding an equitable estoppel defense. The Court noted that amendments were usually “generously” allowed, but defendant provided no justification for not including equitable estoppel in its original answer. Defendant argued that it required investigation to discover its equitable estoppel defense, but the Court noted that the information defendant relied upon was in defendant’s possession. So, there was no reason that defendant could not have conducted its investigation before filing its answer.

*  A copy of the Opinion is available here.

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Playboy Enters. Int'l., Inc. v. 3E Trading, LLC, No. 07 C 1111, Slip Op. (N.D. Ill. Apr. 30, 2007) (Shadur, J.).*

Judge Shadur struck defendant's answer sua sponte, with leave to file an amended answer.  Plaintiff Playboy Enterprises International ("Playboy") alleged in its Complaint that the parties entered a series of agreements (the "Agreements") pursuant to which defendant 3E Trading ("3E") was licensed to use various Playboy trademarks in connection with the sale of specifically defined categories of products -- for example money clips, lamps, glassware and bar accessories.  But Playboy contended that 3E continued selling the previously licensed products after the Agreements expired.  3E answered the Complaint (here is a copy of the Answer), as many defendants do, with numerous blanket denials and Fed. R. Civ. P 8(b) statements that 3E lacked sufficient knowledge or information to admit or deny the allegations.  The Court identified numerous paragraphs that it did not believe could be denied for lack of information with the good faith required by Fed. R. Civ. P. 11(b).  For example, the Court held that 3E must have had some knowledge by virtue of its entry into the Agreements as to at least some of the statements made in paragraphs 6 and 7 identifying certain marks allegedly owned by Playboy and the fact that the marks were valuable.  The Court did not identify all of the deficiencies it found, but warned that answers such as this one "tend to defeat the entire purpose of notice pleading."  The Court required, as noted above, that 3E amend its answer and required that 3E's counsel:  1) not charge 3E for amending the Answer; and 2) copy the Court on a letter to 3E explaining that they will not be charged for the amended Answer.

This may not be a stiff penalty, but it is both exceedingly rare and embarrassing for counsel.  It presents an important practice tip:  answer complaints thoroughly, parsing your admissions and denials with extreme care.  While you must be careful not to admit things improperly, it is also risky to make blanket denials regarding facts that should be in your possession.

*Because this opinion is not on Westlaw yet, you can read a copy here.

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Martin Eng. Co. v. CVP Group, Inc., No. 06 C 4687, 2006 WL 3541777 (N.D. Ill. Dec. 7, 2006) (Cole, J.).

Judge Cole granted defendant's motion for a 21 day extension to respond to written discovery requests.  Plaintiff refused to agree to the extension (for discovery due eight months prior to the close of fact discovery) and filed a written objection to defendant's motion citing a "pattern of dilatory conduct."  As examples of the pattern, plaintiff identified two items.  First, that it took defendant two weeks to respond to plaintiff's settlement offer, and only then after repeated calls from plaintiff.  And second, that defendant's Rule 26 disclosures were served nearly two weeks late.  The Court made clear that it did not condone a party ignoring the Court's deadlines or delay more generally, but noted that "not all delays are the same."

Plaintiff's objection to the extension ignored defendant's justification for its request.  Defendant's counsel, a solo practitioner, was involved in another case in the Northern District in which Judge Kocoras had recently ordered that fact discovery close a few weeks after defendant's responses were do in this case, requiring that defendant's counsel devote "significant time" to the other case.

Based on defendant's explanation, the Court stated that "the request was reasonable, and the plaintiff's response (and ensuing written objection) quite the opposite and needlessly required the expenditure of time that could have been more profitably utilized."  The Court also noted general concerns among some of the Northern District judges regarding "the needless conflict involved in the day-to-day interactions among lawyers" citing articles by Judge Gettleman, We Can Do Better, 25 LITIGATION 3 (Summer 1999), Judge Kennelly, From Lawyer To Judge, 2001 LITIGATION 3 (Summer 2001), and Judge Shadur, Hardball Litigators, 20 LITIGATION 21 (1993).  Unfortunately, the articles are no longer available online, but you may be able to get copies from the ABA here.

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