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

Heriot v. Byrne, No. 08 C 2272, Slip Op. (N.D. Ill., Jul. 21, 2008) (Conlon, J.).

Judge Conlon denied defendants’ motion to dismiss plaintiffs’ copyright and related state law claims based upon forum non conveniens, Colorado River abstention, and for lack of standing. Plaintiffs alleged that they were co-owners of defendants’ copyrights in the popular books and movies associated with The Secret, a self-help program. Defendants previously filed a suit in Australia seeking a declaratory judgment that defendants owned the copyright in The Secret.

 

Forum Non Conveniens

 

The Court held that the Australian Court would not be able to resolve US copyright ownership, and, therefore, was not an adequate forum. Furthermore, much of the evidence for plaintiffs’ unjust enrichment and equitable accounting claims was located in the US, as were the key witnesses. 

 

Colorado River Abstention

 

Although both suits focused on the same works, the Australian case did not include and would not resolve plaintiffs’ equitable claims for unjust enrichment and the equitable accounting. Because the Australian case would not resolve all issues in the US case, abstention was no appropriate.

 

Standing

 

The Court held that plaintiffs had standing to make its copyright claims because plaintiffs alleged copyright ownership in their complaint.

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Hyperquest, Inc. v. N’Site Solutions, Inc., et al., No. 08 C 483, --F. Supp. 2d--, 2008 WL 2446206 (N.D. Ill. Jun. 18, 2008) (Shadur, Sen. J.)

Judge Shadur granted defendants’ motion for attorney’s fees pursuant to 17 U.S.C. § 505, after previously dismissing plaintiffs’ copyright claims for lack of standing – click here for the Blog’s post about that opinion. Plaintiff agreed that defendants were not § 505 “prevailing parties” because the case was dismissed for lack of subject matter jurisdiction. But the Court explained that its opinion and the parties’ underlying briefs used imprecise language, citing an Abraham Lincoln pearl of wisdom:

If you call a tail a leg, how many legs has a dog? Five? No, calling a tail a let don’t make it a leg.

The case was not dismissed for lack of a properly registered copyright (subject matter jurisdiction), but because plaintiff lacked sufficient right to assert the copyright (standing). Because the case was dismissed with prejudice for lack of standing, defendants were prevailing parties and an attorney’s fee award was warranted.

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Biopolymer Eng'ing, Inc. v. Biorigin, No. O7 C 4234, 2008 WL 927984 (N.D. Ill. Apr. 4, 2008) (Shadur, J.).

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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Geisha, LLC v. Tuccillo, No. 05 C 5529, 2007 W> 2608558 (N.D. Ill. Sep. 4, 2007) (Pallmeyer, J.).

Judge Pallmeyer held that the Court lacked jurisdiction over plaintiff Geisha’s declaratory judgment claim. Geisha operates a series of restaurants, each called Japonais – Japonais Chicago, Japonais New York and Japonais Las Vegas. Between the openings of Japonais Chicago and Japonais New York, defendant Roy Tuccillo (“Tuccillo”) filed an intent to use trademark application for a nearly identical Japonais mark, with the “firm intent” to open a restaurant using the mark. Geisha registered Japonais with the State of Illinois, but never federally registered the mark. Geisha sought, among other things, a declaratory judgment that Geisha owned the Japonais mark and that Tuccillo’s opening of a Japonais restaurant would infringe Geisha’s mark. The Court noted that the Seventh Circuit looks to patent law when considering whether there is an actual controversy in a trademark declaratory judgment action. The Court, therefore, relied upon the Supreme Court’s recent MedImmune, Inc. v. Genentech, Inc., 127 S.Ct. 765 (2007), decision which required that a controversy be “real and immediate,” overturning the Federal Circuit’s reasonable apprehension of suit test. The Court held that there was no “real and immediate” controversy. While Tuccillo had filed for registration of a Japonais mark nearly identical to Geisha’s and expressed his firm intent to open a Japonais restaurant, Tuccillo’s actions did not suggest that there was “imminent danger” that he would actually open a restaurant when the suit was filed. Tuccillo testified that he had generally looked at some properties to purchase for the restaurant, but he did not remember when he had done that and could not identify specific properties. Additionally, Tuccillo purchased a Chinese restaurant in 2002, but leased the space without opening a Japonais restaurant in 2003, two years before Geisha filed this suit.

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Everything Baseball Ltd., LLC v. Team Athletic Goods, Inc., No 05 C 5526, Slip Op. (N.D. Ill. Aug. 16, 2007) (Pallmeyer, J.).

Judge Pallmeyer denied defendant Team Athletic Goods, Inc.’s (“TAG”) Fed. R. Civ. P. 12(b)(1) motion to dismiss for lack of standing. The inventors of the patent at issue, for baseball chest protectors, assigned their rights in the patent to Everything Baseball Ltd. (“EB Ltd.”), but the correct corporate name was Everything Baseball Limited, LLC (“EBL LLC”). Plaintiffs argued that because EBL LLC was not the assignee when it filed suit, the Court should dismiss the case. But the Court held that the assignment to EB Ltd. was a clerical error and that the parties’ clear intent was to assign to plaintiff EBL LLC. The Illinois’s records show that while EBL LLC was incorporated, EB Ltd. never existed. Furthermore, some months after TAG identified the error, EBL LLC amended their assignment with the PTO. But the Court did note that the amended assignment could not create standing in this suit. The Federal Circuit case law is clear that where standing does not exist when the suit is filed, it cannot be corrected during the suit. The difference in this case was the Court’s ruling that the intent of the assignment agreement was to assign the patent in suit to EBL LLC, not EB Ltd., which did not exist.

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Rowe Int'l Corp. v. Ecast, Inc., No. 06 C 2703, 2007 WL 1438370 (N.D. Ill. May 14, 2007) (Kennelly, J.).*

Judge Kennelly denied defendants' motion to dismiss plaintiffs' patent infringement complaint for lack of standing.  As to two patents that were not expressly assigned to plaintiffs before the suit was filed (the "Progeny Patents"), the Court used Illinois contract law to interpret the following blanket provision in the assignment agreement regarding the parent patent, which assigned the parent application and any improvements or related applications:

any and all other applications . . . which the undersigned may file . . . on said invention or improvements, and in any and all Letters Patent of the United States and foreign countries, which may be obtained on any of said applications . . . .

The Court held that this provision was unambiguous.  Pursuant to this provision, the inventors assigned plaintiffs any related patents or improvements to the original application.  Because the Progeny Patents were related to the parent patent, they were assigned to plaintiffs.  And, therefore, plaintiffs had standing to file suit.  Additionally, the Court noted that the express assignment of the Progeny Patents that plaintiffs received post-filing did not retroactively confer standing upon plaintiffs for this suit.

*  You can read more about this case in the Blog's archives.

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Adventus Ams. Inc. v. Innovative Envtl. Techs., Inc., No. 06 CV 3267, 2007 WL 704938 (N.D. Ill. Mar. 5, 2007) (Manning).

Judge Manning dismissed one plaintiff for lack of standing and transferred the case to the Eastern District of Pennsylvania.  Plaintiff EnviroMetal Technologies ("EnviroMetal") had an exclusive license to the patent-in-suit from the University of Waterloo in Canada.  The Court held that EnviroMetal's license was sufficiently exclusive to create standing because, among other things, it expressly gave the right to make use or sell and EnviroMetal had exclusive sublicensing rights.  Plaintiff Adventus Americas ("Adventus"), however, was a non-exclusive sublicensee of EnviroMetal and the Court held it had no standing.  Defendant also argued that the Court lacked personal jurisdiction, but the Court held that defendant's sales contacts with Illinois were sufficient to create personal jurisdiction.

Having decided the standing and jurisdictional issues, the Court transferred the case to the Eastern District of Pennsylvania.  Although EnviroMetal had chosen Illinois as a form, that choice was given little weight because of Illinois's relatively weak connection to the facts of the case.  And the Court held that the convenience of the parties was best served by transfer because EnviroMetal had to travel regardless of which district the case was in, but defendant's employees would not have to travel if the case were transferred.  Additionally, the case would likely be resolved more quickly in Pennsylvania -- the median time to trial in the N.D. Ill. is 26.4 months, compared to 18.0 in the E.D. Pa.

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