CLE: IPLAC & Linn Inn of Court Joint Meeting

By R. David Donoghue on Posted in Legal News

On Monday, April 23, 2018, the Intellectual Property Law Association of Chicago (IPLAC) and Chicago’s Linn Inn of Court are hosting a joint meeting at the Chicago-Kent College of Law, 555 W. Adams St., Chicago. Jerold Jacover will be presenting on Happiness and the Law. IPLAC is applying for one hour of mental health/substance abuse CLE credit. There is no charge for IPLAC members, but you must pre-register.

The CLE presentation begins at 6:00 pm with a pre-meeting reception beginning at 5:30 pm and a post-presentation reception at 7:00 pm.

CLE: Practical Applications of Data Analytics in Discovery

By R. David Donoghue on Posted in Legal News

The Seventh Circuit Pilot Program on Electronic Discovery is hosting a complimentary webcast CLE discussing practical applications of data analytics in discovery on April 11, 2018 from 12 pm – 1:30 pm CT.

This program tackles one of the most complex, expensive and vilified parts of litigation – discovery – looking at ways to improve, simplify and streamline the process. The program will discuss:

  • The various types of data analytics available to lawyers and legal teams;
  • How attorneys can leverage early case assessment (ECA) and early data assessment (EDA) to control costs and better define case strategy;
  • Courts’ acceptance of the use of analytics by parties in litigation; and
  • Other legal data analytics use cases, including data culling, custodial validation, sentiment analysis, contract management, data remediation, sensitive data governance, and more.

The panel includes:

  • Sean Byrne, Calibrate Advisors
  • Doug Kaminski, Relativity
  • Debbie Reynolds, Eimer Stahl Discovery Solutions, LLC
  • Tom Thompson, Thompson Legal
  • Martin Tully, Actuate Law

Register HERE.

Expert’s Shortcomings to be Weighed by a Jury

By R. David Donoghue on Posted in Summary Judgment

Bodum USA, Inc. v. A Top New Casting, Inc., No. 16 C 2916, Slip Op. (N.D. Ill. Dec. 28, 2017) (Kennelly, J.).

Judge Kennelly denied defendant A Top’s motions for summary judgment and to exclude the testimony and survey evidence of plaintiff Bodum’s survey experts in this Lanham Act trade dress case involving French-press coffee makers.

Motion to Exclude

The Court allowed Bodum’s expert testimony as to whether elements of Bodum’s alleged trade dress was functional. The expert considered what he thought the trade dress was, rather than what Bodum defined its trade dress to be. But the Court held that the “relatively minor differences” between the two definitions did not warrant exclusion. Additionally, it was “less than clear” whether the expert excluded functional elements of the trade dress before performing his analysis. Finally, the expert’s consideration of alternative French press designs was not improper. The existence of alternatives was relevant to the analysis. The Court left a determination of the expert’s credibility and the issues with his report to the jury.

The shortcomings in Bodum’s survey results went to its weight, not admissibility. For example, the expert’s decision not to include product information similar to that which a consumer would see alongside the product on Amazon — where both products were sold — could cut either way and was a factor for the jury’s consideration. A Top also argued that the survey was over broad in various ways and too narrow in others. Those issues were also for the jury to weigh.

Summary Judgment

  1. Functionality of Bodum’s Trade Dress

The fact that Bodum’s patent described the functionality of several of its alleged trade dress elements weighed in favor of finding functionality. Some of Bodum’s advertising also touted functional benefits of certain trade dress elements. On the other hand, Bodum presented several alternative French press designs, and showed several non-functional features of the trade dress. Drawing all inferences in Bodum’s favor, the Court denied summary judgment of functionality.

  1. Likelihood of Confusion

Beyond stating that the products are “relatively low-priced household goods that sell for under fifty dollars,” Bodum had no offer to support the contention that purchasers are unlikely to use a high degree of care in choosing a French press. And Bodum produced no evidence of actual confusion. Similarly, Bodum offered no evidence of passing off. But a visual comparison of the parties’ French presses weighed in favor of likelihood of confusion. The survey also suggested there might be a likelihood of confusion. In light of the competing evidence and drawing all inferences in Bodum’s favor, the Court denied summary judgment of no likelihood of confusion.

  1. Secondary Meaning

While Bodum had not presented direct evidence of secondary meaning, there was considerable circumstantial evidence, including Bodum’s thirty years selling its French press in the United States, its prominent place in the market, and Bodum’s advertising. Additionally, the survey evidence, although it was not intended to investigate secondary meaning, suggested secondary meaning. The Court, therefore, denied summary judgment.

Northern District of Illinois — One of the Busiest & Most Affirmed Patent District Courts

By R. David Donoghue on Posted in Legal News

The Northern District of Illinois is one of the top six districts nationwide in terms of Federal Circuit affirmances. According to a recent IP Law360 article, the Federal Circuit affirmed 71% of patent appeals from the Northern District from January 2015 through December 2017. That puts the Northern District tied for sixth with the Southern District of Florida, and well above the average affirmance rate during the period — 56%. The average fits well with statistics over time from the Federal Circuit which show affirmance rates around 50%. The fact that the Northern District is significantly higher speaks well of the Northern District judges, and is positive for Northern District patent litigants that can have more certainty than most in the Northern District’s dispositive rulings.

Summary Judgment Granted Based Upon Failure to Respond to Arguments

By R. David Donoghue on Posted in Pleading Requirements

GemShares, LLC v. Lipton, et al., No. 17 C 6221, Slip Op. (N.D. Ill. Feb. 11, 2018) (Kennelly, J.).

Judge Kennelly granted in part defendants’ Fed. R. Civ. P. 12(b)(6) motion to dismiss certain counts of plaintiff GemShares’ complaint in this patent case involving methods for using gems in financial and commercial transactions.

Defendants contended that by amending its complaint to give up certain claims of another patent, GemShares waived its claims as to claims 7 through 11 of the patent in suit. While the Court did not see why dismissing claims of one patent would have an impact on the viability of claims from another, the Court granted the motion because GemShares failed to respond to the issue at all in its papers.

Defendants’ fiduciary duties and duty of loyalty to GemShares did not prevent defendants from challenging the validity of the patent. The Court did reserve the right to reconsider the issue later in discovery, where the Court might have factual bases for evaluating GemShares’ claims.

The Court denied defendants’ motion to dismiss claims against the individual defendant. GemShares adequately pled its case. While it may eventually be dismissed on summary judgment, this was merely a motion to dismiss.

Reconsideration Requires Manifest Error, Not Just Inaccuracy

By R. David Donoghue on Posted in Summary Judgment

Feb. 2, 2018) (Pallmeyer, J.).

Judge Pallmeyer denied plaintiff’s motion for reconsideration of the Court’s summary judgment decisions against plaintiff in this patent dispute involving stalk stompers — devices that attach to a tractor or combine to flatten cornstalks after they have been cut.

The Court found a handful of factual errors and that certain portions of the ruling required “more precise legal analysis.” The Court corrected those, but held that plaintiff did not identify any manifest errors of law or fact that mandated a different outcome to any of the Court’s decisions. The Court did, however make clear that to the extent it appeared to have granted plaintiff summary judgment as to the effective filing date of the plaintiff’s ‘963 patent, that ruling was improper to make the determination as a matter of law and the decision was, therefore, withdrawn.

Of particular note, the Court held as follows:

  • Defendants’ failure to disclose its effective filing date argument in its Local Patent Rule (“LPR”) contentions did not bar the argument. The argument regarding the filing date was not an affirmative invalidity argument that was required to be laid out in LPR contentions. Rather, it was a reply to plaintiff’s response to defendants’ invalidity contentions. Defendants acted properly and timely by laying out their effective filing date argument by letter after receiving plaintiff’s responses to defendants’ invalidity contentions.
  • Regarding the burden as to an effective filing date, patentholder has an initial burden to provide evidence of its filing date. After that the burden shifts to the challenger to provide clear and convincing evidence that the patent claims are not entitled to the earlier filing date.

Willful Counterfeiting Merits Permanent Trademark Injunction

By R. David Donoghue on Posted in Trial

Luxottica Group S.p.A. V. Li, No. 16 C 487 & 1227, Slip Op. (N.D. Ill. Feb. 25, 2017) (Shah, J.).

Judge Shah granted plaintiffs Luxottica and Oakley (collectively “Luxottica”) Fed. R. Civ. P. 56 motion for summary judgment in this Lanham Act dispute regarding Wayfarer sunglasses and earrings bearing Luxottica’s marks.

Defendant operated several online stores selling counterfeit goods, specifically sunglasses and earrings. Defendant conceded that Luxottica’s trademarks were valid and incontestable. Defendant also conceded likelihood of confusion. Defendant’s defense was based upon fair use, but that failed. Defendant argued that it was using wayfarer to describe the shape of the sunglasses and that it was used so frequently across the internet that it no longer was understood to distinguish Luxottica’s sunglasses, but a shape of sunglasses. But “wayfarer” does not describe any characteristic of the sunglasses. Therefore, the argument failed.

Defendant’s argument was almost a genericness argument, but because it was not explicitly or fully made, the Court did not consider it.

Considering defendant’s “bare-bones” procedures to avoid infringement, the purposeful nature of the infringement, Luxottica’s efforts in protecting its marks, and the vast reach of defendant’s internet shops, a high award was necessary to compensate Luxottica, penalize defendant and deter future infringement. Defendant’s “inadequate” efforts to minimize its infringing activities mitigated the damages “to some degree.” The Court, therefore, awarded $60k in damages.

The Court entered a permanent injunction. Luxottica showed irreparable harm based upon the confusion created by defendant’s infringing activities and the balance of harms favored Luxottica. Being enjoined from breaking the law was not a hardship.

The Court also awarded Luxottica reasonable attorney’s fees  because it was required for cases of intentional use of a counterfeit mark. The Court ordered the parties to comply with Local Rules 54.1 & 54.3 to determine the appropriate fees.

Lex Machina 2017 Patent Litigation Study — Patent Reform at Work

By R. David Donoghue on Posted in Legal News

This analysis is being cross-posted at my [Chicago IP Litigation blog/Retail Patent Litigation blog].

Lex Machina recently published its comprehensive 2017 patent litigation year in review. As usual, it is full of fascinating data and charts, which I commend for your consideration.

Most of us in the space know the biggest takeaways already — patent litigation is down, way down in all forums. District court patent litigation waned to its lowest point since 2011. That is no doubt in large part due to the corrective actions taken by Congress (the America Invents Act) and the courts, principally the Supreme Court, in the form of Alice (software patent ability), Octane Fitness (the exceptional standard for attorney’s fees awards), and Lexmark (patent exhaustion), among others.

TC Heartland has also had a major impact on where cases are filed since the Court’s ruling last spring. E.D. Texas filings are down nearly 50% since the venue ruling, while Delaware filings are up 70% during the same time. Central California, Northern California and New Jersey also show more modest increases, along with a variety of other districts that have considerably smaller patent dockets. Looking at the statistics another way, since TC Heartland only 13% of cases were filed in East Texas (down from 33%), with 23% filed in Delaware (up from 13%), and the remaining 63% filed in the other districts (up from 54%). Of course, with 13% of the filings, East Texas remains an important patent district, but it is no longer the powerhouse that it was and I would expect it to continue to slip as Delaware, California, Chicago and other courts continue to see larger percentages of the filings.

PTAB proceedings have also fallen off considerably. Some of that is no doubt related to the reduced district court litigation filed in 2017. But the Oil States cases awaiting the Supreme Court determination of the constitutionality of the proceedings is also certainly having a major impact. The Oil States decision will have a major impact upon the patent world, in terms of patent dispute proceedings and in terms of relative patent value.

CLE: Northern District of Illinois Symposium on Women Lawyers in the Courtroom

By R. David Donoghue on Posted in Legal News

The Northern District, along with the Chicago Bar Association and in conjunction with the Women’s Bar Association of Illinois and the Black Women Lawyers’ Association, are sponsoring a free program, “May it Please the Court:” Symposium on Women Lawyers in the Courtroom.

It is being held from 12:30-5:15pm CT on April 12, 2018, at the Northern District Courthouse, 219 S. Dearborn Street, Chicago.

The program is focused on discussing and promoting strategies for empowering women lawyers as lead counsel and trial counsel. The following topics will be addressed:

  • The Studies: A discussion of the studies “If Not Now, When? Achieving Equality for Women Attorneys in the Courtroom and in ADR” and “The Participation of Women Lawyers as Lead Counsel and Trial Counsel in Litigation.”
  • In-House Counsel: Corporations are positioning women as leaders on trial teams and promoting strategies to further increase women lawyer participation in their matters.
  • The Next Generation of Women Trial Lawyers: Tips and strategies to gain trial experience in order to become lead trial counsel.
  • Managing Partners: Best practices to increase the number of women in the courtroom.
  • A View from the Bench: Judicial observations on the benefits of women as trial counsel and what can be done to increase the number women trying cases.

You can register here and see the brochure here. Northern District judges on the panel include, Chief Judge Castillo, Judge Durkin, Judge Ellis, Judge Pallmeyer, and Judge St. Eve.

Court Strikes Complaint Allegations Unrelated to Claims

By R. David Donoghue on Posted in Pleading Requirements

VitalGo, Inc. v. Kreg Therapeutics, Inc., No. 16 C 5577, Slip Op. (N.D. Ill. Dec. 21, 2017) (Dow, J.).

Judge Dow granted in part defendants’ (collectively “Kreg”) Fed. R. Civ. P. 12(b)(6) motion to dismiss plaintiff’s (collectively “VitalGo”) claims and Fed. R. Civ. P. 12(f) motion to strike portions of its complaint in this copyright and Lanham Act suit involving VitalGo’s Total Lift Beds and Catalyst Beds. The Court also denied Kreg’s motion to stay discovery pending resolution of its motion.

Motion to Strike

The Court struck those allegations in VitalGo’s complaint that had “no apparent relevance” to its Catalyst Bed-related complaints, but did relate solely to legal theories previously dismissed from suit. Allowing VitalGo’s unrelated allegations to remain would “confuse” the issues and prejudice Kreg. The Court did, however, refuse to strike paragraphs related to the prior claims that provided context regarding the parties’ relationship, the TOTAL LIFT BED marks at issue, and VitalGo’s copyrighted works.

Motion to Dismiss

  1. Fed. R. Civ. P. 12(g)

Kreg’s motion was not barred pursuant to Rule 12(g) by the filing of its earlier motion to dismiss for two reasons:

  • The claims made in the instant motion were not available to Kreg until after the Court ruled on the initial motion to dismiss because they are premised upon the removal of the stricken allegations, which were struck based only upon the Court’s order dismissing certain claims.
  • The Seventh Circuit has held that Rule 12(g)(2) does not bar a successive motion to dismiss.
  1. Judicial Estoppel

Judicial estoppel did not bar Kreg’s motion. Kreg’s prior arguments were focused upon legal defenses, as opposed to the sufficiency of VitalGo’s allegations. The Court also had not previously decided whether Rule 9(b) applied to the allegations.

  1. Unfair Competition Claims Sounding in Fraud

While district courts in the Seventh Circuit split on whether Rule 9(b) pleading is required for unfair competition Lanham Act and related state law claims, the Court held that Rule 9(b) heightened pleading was required as to VitalGo’s claims because they sounded in fraud. Because VitalGo gave “the headline of the newspaper story, but not its ‘first paragraph,’” the claims were dismissed.

  1. Trademark & Copyright Infringement

VitalGo sufficiently pled its infringement claims by pleading ownership, knowledge and infringement for copyright, and ownership and likelihood of confusion as to VitalGo’s trademarks.

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