JUUL Labs, Inc. v. Murshed (D. N.H. 20-cv-00868).

Vape maker JUUL sued Salam Murshed, accusing him of infringing the JUUL® trademark, counterfeiting, and unfair competition under the Lanham Act and under New Hampshire state law.  Murshed is said to own and operate the Salem Vape & Smoke Shop and the Smokers Choice II shop in Concord; each of these businesses are owned by corporations that Murshed owns and that are not in good standing with the State of New Hampshire.  JUUL holds federal registrations on a basic word mark and a styled mark for “JUUL” as well as a word mark for “JUULpods.”  JUUL asserts that Murshed sells counterfeit goods made outside of JUUL’s control and using unknown substances, and that Murshed also imports for sale in the United States products that are expressly identified on the packaging as authorized for sale only outside of the United States, with labeling that is not compliant with U.S. law.  Both businesses ignored cease and desist letters and continued to sell the accused goods.  Among other things, JUUL seeks an award of up to $2 million per mark for willful counterfeiting under 15 U.S.C. 1117(c).

Bio-Rad Laboratories, Inc. et al. v. 10X Genomics, Inc. (19-cv-12533).

Bio-Rad and Harvard University sued 10X Genomics in 2019, accusing 10X of infringing two patents owned by Harvard and exclusively licensed by Bio-Rad and of infringing one Bio-Rad – owned patent.  Judge Young denied 10X Genomics’ motion to dismiss the induced and willful infringement claims on the three patents, finding these claims to be sufficiently pled.  The complaint alleges that 10X knew of the two Harvard-owned patents – with knowledge being an element of both induced and willful infringement – by way of previous litigation between the parties on the patents-in-suit that was dismissed in favor of the current suit and by way of 10X’s own license agreements with Harvard.  This knowledge is further evidenced by 10X having cited the published application that matured into one of the patents in an IDS with the Patent Office.  The complaint further alleges 10X had knowledge of the Bio-Rad patent because the sole inventor on that patent subsequently left Bio-Rad to form 10X.  That patent was also cited by 10X in an IDS.  Importantly, the complaint alleges that the knowledge of the three patents came about before the litigation was filed, as willfulness cannot in this district be predicated on knowledge resulting from the complaint.  Judge Young further noted that, at the motion to dismiss stage, a pleading alleging pre-suit knowledge of the patents and continued sale of the allegedly infringing products is sufficient to state a claim of willful infringement.

10X also moved to dismiss for improper forum or transfer the Bio-Rad – owned patent claim.  Judge Young denied the dismissal request.  He found that this patent, unlike the Harvard-owned patents, was not the subject of the forum selection clause found in 10X’s license with Harvard that directed claims be brought in Massachusetts.  Further, the patent venue statute had been held to limit suits to districts in which the defendant resides or has committed acts of infringement and has a regular place of business.  10X is incorporated in Delaware and is located in California, and the complaint lacks allegations that 10X has a physical location in Massachusetts.  The patent venue statute thus does not provide for venue in Massachusetts.  Judge Young determined that Bio-Rad could rely on pendant jurisdiction, because the non-Harvard infringement claims were directed towards the same products that the Harvard-owned infringement claims.  He granted 10X’s request, however, to transfer the infringement claim with respect to the Bio-Rad patent to the Northern District of California.  As Harvard is not a co-plaintiff on that claim, the forum selection clause in the Harvard license does not apply and the sole connection with Massachusetts does not exist.  Both Bio-Rad and 10X are headquartered in N.D. California, the sole named inventor on the patent resides in the district, and the parties are already litigating a different patent, related to the Bio-Rad patent in this case, in that district.  Judicial economy favors transfer.

Baystate Health, Inc. v. Bay State Physical Therapy, PC et al. (20-cv-30042).

Baystate Health accuses Bay State Physical Therapy of willfully infringing its trademarks, and further seeks cancellation of Bay State Physical Therapy’s U.S Registration No. 3,943,252 for “BAY STATE PHYSICAL THERAPY.” In addition to Bay State Physical Therapy, Baystate Health seeks to hold Steven Windwer, Bay State Physical Therapy’s sole officer and director, personally liable. Baystate Health, which runs a number of hospitals and medical practices, asserts that it first began using the BAYSTATE mark in 1976 in association with a wide range of healthcare services, including physical therapy. Baystate Health holds registrations, both state and federal, for various marks that include “BAYSTATE,” including a registration on “BAYSTATE” standing alone. According to the complaint, Bay State Physical Therapy began using the name in August 1995, and Baystate Health first became aware of this use in 2008. At the time, all of Bay State Physical Therapy’s locations were in eastern Massachusetts, which Baystate Health deemed acceptable. In 2010, however, Bay State Physical Therapy applied for a federal registration in which it asserted that, to its knowledge, no one else had the right to use the same or a similar mark in commerce, which Baystate Health asserts was knowingly false. Further, in 2019, BayState Physical Therapy expanded considerably, including into Springfield, Massachusetts, an area Baystate Health operates. Baystate Health asserts common law, state and federal trademark infringement, false designation of origin, violation of M.G.L. c. 93A, and fraud on the PTO.

Given that “Baystate” seems (to me, at least) to be geographically descriptive of Massachusetts, I am curious to see how this plays out for both parties. Bay State Physical Therapy’s registration is to a design mark that incorporates both design elements and colors, and disclaims the wording absent the design, which may be sufficient to overcome the geographical descriptiveness issue (which was not raised in examination). The case, being in the Springfield Division, is before Judge Mastroianni.

Canon, Inc. v. Avigilon USA Corporation, Inc. et al. (19-cv-10931).

Canon sued Avigilon earlier this year, accusing Avigilon of willfully infringing and inducing infringement of a Cannon patent covering transmission of video data. Judge Gorton has now granted Avigilon’s motion to dismiss the induced infringement and willful infringement allegations, finding that Canon’s complaint failed to plead facts sufficient to support an inference of actual pre-suit knowledge of the asserted patent by Avigilon, instead only making conclusory statements to that effect. Judge Gorton noted that there is a conflict between district courts as to whether an alleged inducer must be shown to have had knowledge of the patent prior to the filing of the lawsuit, with a minority of courts holding that post-suit knowledge (as through the complaint itself) of the asserted patent improperly bootstraps the knowledge to pre-suit acts, and more to the point, that the District of Massachusetts has limited the acceptability of knowledge through the filing of a complaint to later-amended complaints that expressly limit the inducement claims to post-filing conduct. He further found the same issues applied to the willfulness allegations, which also require proof of knowledge of the asserted patent. He therefore dismissed the inducement and willfulness claims without prejudice to allow Canon to appropriately amend the complaint, should circumstances permit.

Fenway Enterprises 1271 Boylston Street LLC v. Hard Rock Café International (USA), Inc. (19-cv-11998).

Fenway Enterprises runs the “Verb” Hotel, a retro, music-themed hotel located just outside of Fenway Park that opened in 2014. Verb hotelAs is mentioned on its website, the name for the hotel was chosen as a shortened form of the musical term “reverb,” as well as for signifying action.

Fenway asserts that Hard Rock’s planned launch of a series of musical themed hotels under the name “Reverb” will infringe its federally-registered “VERB” mark for hotel services, as well as its common law rights in the mark. Hard Rock has filed intent-to-use applications for “Reverb” and “Reverb by Hard Rock” for hotel, restaurant, bar and casino services, and already has a website devoted to the new hotel chain, www.reverbhotels.com. Fenway Enterprises asserts that its hotel’s success hinges on the authenticity of its hotel, which would be harmed by association with the Hard Rock’s “glitzy, overstated chain hotels,” expressly citing a giant, guitar-shaped hotel to be opened by the Hard Rock in Florida that has earned the description “monstrosity that has offended nature itself.” Fenway Enterprises further cites the reality television show Rehab: Party at the Hard Rock Hotel as associating the Hard Rock brand with drinking, drug abuse and debauchery. Fenway says that Hard Rock was notified of the Verb Hotel in March, but has thus far refused to rebrand the planned REVERB hotel franchise. In addition to trademark infringement, Fenway asserts violation of Ch. 93A, although it may have difficulty proving that the acts complained of occurred substantially within the Commonwealth – the first REVERB hotel is planned for Atlanta, with a second to follow in California.

SiOnyx, LLC et al. v. Hamamatsu Photonics K.K., et al. (15-cv-13488).

Following trial, Judge Saylor dealt with a number of post-trial motions. He granted SiOnyx’s motion for equitable relief, awarding ownership of the nine patents in dispute to SiOnyx and ordering Hamamatsu to take all necessary steps to correct ownership of the patents. This was based on the non-disclosure agreement that a jury found to have been violated, that provided for ownership of all patent rights arising from the confidential information SiOnyx disclosed to Hamamatsu when exploring a possible business relationship. While the SiOnyx employee who took part in the disclosure was found to be only a con-inventor (along with Hamamatsu personnel), Judge Saylor noted that the non-disclosure agreement expressly provided ownership in the resulting ideas to SiOnyx. Judge Saylor further granted an injunction prohibiting Hamamatsu from making, using, selling, offering for sale, or importing accused products based on language in the NDA that explicitly provided for injunctive relief in the event of breach as well as on SiOnyx’s ownership of the patents, one of which the jury found to be infringed.

Judge Saylor denied Hamamatsu’s motion for judgment as a matter of law, finding that the statute of limitations did not bar suit on the NDA. He noted that this is generally a jury decision, and that there was no reason to overturn the jury’s verdict on this issue. He further refused to modify the unjust enrichment award to stop damages from accruing after the NDA expired, finding that the jury reasonably concluded that post-expiration damages flowed from pre-expiration conduct in designing the accused products.

The rulings were not all bad for Hamamatsu. Judge Saylor treated SiOnyx’s motion to amend the judgement to have their employee deemed the sole inventor on the patents in suit (filed prematurely) as a motion for judgment as a matter of law and denied it. SiOnyx contended that a jury instruction erroneously stated that the method of forming a claimed aspect of the invention was irrelevant, but Judge Saylor determined that, having failed to object to the instruction prior to the jury retiring under Fed. R. Civ. P. 51, SiOnyx had waived the argument, and further that SiOnyx could not raise the issue because it was not argued in SiOnyx’s motion for a directed verdict. Accordingly, Hamamatsu employees remain co-inventors.

Judge Saylor also denied SiOnyx’s motion for fees for an exceptional case. He noted that, while SiOnyx alleged Hamamatsu’s invalidity and non-infringement defenses to be substantively too weak to merit litigating, SiOnyx did not seek summary judgment on either issue. He further found no evidence that Hamamatsu deliberately sought to increase the cost and complexity of the litigation for an improper purpose.

Finally, Judge Saylor denied SiOnyx’s motion for enhanced damages pursuant to 35 U.S.C. 284, which allows the court to assess damages when not found by the jury. Here, the jury awarded damages for breach of contract and unjust enrichment, but awarded $0 in patent damages despite finding willful infringement. SiOnyx contended that the $0 award was, in effect, the jury not “finding” damages pursuant to the statute, permitting the judge to do so. Judge Saylor disagreed, noting that SiOnyx’s damages expert told the jury that there may be overlap between the breach of contract damages and infringement damages, and that the jury might need to choose between the two. Given this, and given the fact that the jury was told not to award duplicative damages, it is reasonable to interpret the $0 infringement award to mean that the infringement damages were covered by the breach of contract damage award. Judge Saylor further refused to treble the damages, since there was no way to accurately determine the level of damages attributable to infringement.

If anyone is wondering why patent litigation is so expensive, note that this case was filed in November 2015, and included significant motion practice and discovery disputes to get to this point, including 70 docket entries just to get to the filing of an answer to the complaint (with motions to dismiss, contesting adequacy of service, and for a preliminary injunction intervening). The case took almost two years to get to a claim construction order, and almost another two years to get to trial, and the matter is just now coming due for appeal. While this case involved additional issues beyond mere patent claims, this is not an unusual time-frame for patent litigation, and helps explain the costs involved.

Nike, Inc. v. Puma North America, Inc. (18-cv-10876).

Nike sued Puma for infringement of seven Nike patents covering shoes having knitted upper, and alleged that after it notified Puma about the patents prior to filing suit, Puma not only failed to cease making and selling the accused products, Puma also introduced new shoes to the market that infringed the patents. Puma moved to dismiss the claims with respect to two of the patents as directed to non-patentable subject matter, asserting that one was directed to the abstract idea of forming an outline pattern on a textile and does not disclose an inventive step towards achieving the outline pattern, and that the second is directed to the abstract idea of generating a visual pattern on a textile, which is nothing more than a non-patentable work of art. Judge Sorokin disagreed, finding that the claims, which were directed to tangible manufactured items (i.e., shoes) or to physical components thereof or methods of manufacturing the same, they passed muster under the first prong of the Mayo test as being directed to a statutorily provided category of patent-eligible subject matter. He further noted that, even if they did not, Puma had not met its burden of demonstrating by clear and convincing evidence that the claims lacked an inventive step that would meet the second prong of the Mayo test. Judge Sorokin also denied Puma’s motion to dismiss the willfulness charges, finding Puma’s suggestion that more must be pled than knowledge of the patent and continued infringement remained an open question (albeit one that other Massachusetts judges had found incorrect), but that Nike had sufficiently pled additional facts that would support a finding of willfulness.

Crane Security Technologies, Inc. et al. v. Rolling Optics AB (14-cv-12428).

Following a trial in which Rolling Optics was found to have willfully induced infringement of several Crane patents, Judge Sorokin ruled on a number of post-trial motions. He denied Rolling Optics’ motion for judgment of no inducement and lack of notice as a matter of law, finding the motion a mere rehashing of the motion for summary judgment that was previously denied. He likewise denied Rolling Optics’ motion for JMOL that certain claims were anticipated, finding the jury’s determination on the credibility of the parties’ experts dispositive. Judge Sorokin denied Crane’s motion for attorneys fees under 35 USC 285, finding that Rolling Optics’ litigation conduct was not exceptional, particularly given that the injunction that would likely result from losing would jeopardize Rolling Optics’ very existence. He awarded Crane treble damages, finding that Crane had demonstrated that Rolling Optics had copied their products with extensive knowledge of Crane’s patent portfolio and that Rolling Optics took no steps to ensure that they were not infringing valid patent claims – indeed, Rolling Optics continued shipping products into the United States seven months after it had been advised by its legal team to cease doing so. Finally, Judge Sorokin entered a permanent injunction, finding that Rolling Optics was directly competitive to Crane such that continued infringement would result in harms that could not be adequately remedied at law.

Great Dane Graphics, LLC v. Vovo, Inc. and Jonathan Gosselin (18-cv-10126).

Michigan graphics company Great Dane offers subscription services that provide licenses to an extensive library of original graphic artwork for clothing such as T-shirts. Gosselin, a former employee of one such licensee, is accused of having stolen thousands of copyrighted Great Dane images from his ex-employer and using them to set up a competing screen printing business, Vovo.  Gosselin reportedly used the same selection, arrangement and coordination of the images, and even to have used the same product numbers for the images as had Great Dane.  In addition to the civil suit, it appears that Gosselin is being investigated by the Braintree police, as a police report is included as an exhibit to the complaint.  Great Dane seeks injunctive relief, statutory damages of up to $150,000 per infringement due to the alleged willful nature of the infringement, and attorney’s fees.

Philpot v. Kinder et al. (17-cv-11991).

Larry Philpot, a professional concert and event photographer from Indiana, sued Encore Unlimited, Inc., Printed Guitar Picks Limited, and numerous individuals for copyright infringement. Philpot alleges the defendants uploaded photographs he had taken of Carlos Santana, Neil Young, and Kid Rock, printing them on guitar picks, and advertising and selling them through their own websites as well as on Ebay.  He seeks liability for reproduction and public display, as well as for unfair and deceptive trade practices under M.G.L. Ch. 93A.  Philpot further alleges that the copyright infringement was willful, based (solely, it appears) on his allegation that the defendants tried to hide their identities by registering their domains under aliases.  A review of one of the defendant’s websites (www.printedguitarpicks.com) reveals that the company allows customers to upload pictures to be printed on guitar picks, while also offering stock pictures of various artists; it is unclear from the complaint whether the former or the latter are the subject of the suit.  For the latter, the website indicates that all customers submitting photographs warrant that they obtained permission from the copyright holder; it will be interesting to see whether this clause affects the willfulness decision.