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In late May, I attended the sixteenth annual Rocky Mountain IP Institute. I also spoke at the Institute about best practices for communicating between in-house team and outside counsel (more on that later). The Rocky Mountain IP Institute has grown to be one of the largest two IP conferences in the country. More importantly than that, for years it has been one of the best, if not the best, IP conference in the country in terms of quality and varied content. If you practice IP law and need / want to learn about what is going on in any area of IP, the Institute is the place to be at the end of May every year. The opening plenary session was a presentation by Joseph Matal, Associate Solicitor at the U.S. Patent Office and former interim director of the Patent Office. Matal’s remarks were very interesting. Here are some highlights:

  • He referenced the Wright Brothers’ fundamental patents describing their inventions of controlling the pitch, yaw and roll of an aircraft. While others had invented components of the airplane before or contemporaneous with the Wright Brothers, no one had figured out how to control them in flight.
    • Patent protection was critical to the Wright Brothers and remains so today for inventive, transformative inventions, inventors and companies.
  • No system should be defined by its flaws.
  • It is critical for the Patent Office and its systems to be “reliable and predictable.”
  • It took 67 years to issue patent 1M under the new numbering system. It took about 15 years to go from 4M to 5M in 1991. Going from 8M to 9M took about three years. Patent 10M is expected to issue later this year. The speed of innovation is dramatically increasing, at least as measured by patenting.
  • The Patent Office has a stable workforce. More than 100 examiners have been with the Patent Office for more than thirty years.
  • Patent pendency has declined to about 15.5 months for a first office action and 24 months for a final action. The Patent Office plans to get faster achieving at least the PTA goals of 14 months for a first action and 36 months for final issuance.
  • PTAB proceedings:
    • The goal of the PTAB was to dig out from the mess of slow and complex inter partes reexams.
    • The idea under the AIA was that there would be unknowns that would come up after the PTAB was created. So, the PTAB was given relatively broad ability to set its rules to address those unknowns as they arose. An example of this is the PTAB’s recent request for public comment regarding normalizing the PTAB’s claim construction standard with the district court’s standard.
    • The PTO is looking at revising its expanded panel process.
    • The ultimate goals are to focus on reliability and predictability. The PTO wants stakeholders to know what they are getting and what to expect in PTAB processes.
    • The SAS case was “somewhat surprising.” The Justice Department thought the PTO would win the case, although, or because, the statute was silent on the issue.
      • There is value in it, however, because it makes sure that all issues are resolved at the PTAB making a cleaner distinction between the PTAB and the district court. It also removes burden from the district court.
      • The PTAB will have to guard against “kitchen sink” petitions with one or two strong arguments and numerous weak claims, he suspects the PTAB will reject the entire petition to force petitioners to bring strong petitions that focus on the real invalidity issues.

I look forward to returning to the seventeenth edition of the Rocky Mountain IP Institute in May 2019. You should join me.

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The Northern District of Illinois has a critical number of vacancies. Judge St. Eve just left for the Seventh Circuit. Judge Zagel took senior status in October 2016. Judge Zagel took senior status in March 2017 and passed away shortly thereafter. Judge Der-Yeghiayan retired in February 2018. Senior Judge Shadur (who maintained a very full docket) also retired early this year, shortly before he passed away. Judge Kapala in the Western Division plans to take senior status in 2019. With approximately 15,000 civil cases in the Northern District at any given time, being down four judges, as well as several senior judges, is a significant issue for the Court. It will eventually translate into slower justice.

Senators Durkin and Duckworth sought applications to fill the spots with application packets due February 1. So, hopefully the vetting and nomination process is well underway and we will have several appointments this year.

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TopstepTrader, LLC v. OneUp Trader, LLC, No. 17 C 4412, Slip Op. (N.D. Ill. Apr. 18, 2018) (Leinenweber, J.).

Judge Leinenweber granted in part defendant OneUp Trader’s Fed. R. Civ. P. 12(b)(6) motion to dismiss and defendant Alsabah’s Fed. R. Civ. P. 12(b)(2) & (6) motion to dismiss for lack of personal jurisdiction and failure to state a claim in this copyright dispute involving electronic trading systems.

Personal Jurisdiction

Alsabah had to enter an agreement to use TopstepTrader’s software in which he allegedly consented to jurisdiction in Illinois. The Court held that the contract was on a spectrum between a clickwrap and a browsewrap agreement, in a type of agreement referred to as sign-in-wrap. Alsabah did not take an affirmative action to explicitly agree to the site terms, but there was affirmative action in that Asabah had to sign up for an account. During the sign up process, Alsabah would have been informed that by creating an account, he accepted the terms of service, along with a hyperlink to those terms. In fact, Alsabah clicked a “sign up” button next to a hyperlink for the terms. Without doing so, he could not have activated an account and gotten access to TopstepTrader’s website. But the “sign up” button did not clearly state that by clicking on it Alsabah was accepting the terms. So, while it was a close call, the terms and their forum selection clause were not enforceable against Alsabah.

Regarding specific jurisdiction, TopstepTrader’s location in Illinois and harm in Illinois was not sufficient to create personal jurisdiction. But Alsabah specifically sought out TopstepTrader’s website, created an account and then received multiple communications which identified TopstepTrader as an Illinois-based company. While walking into a brick and mortar store in Illinois would have been better evidence of specific jurisdiction, signing up with an Illinois business under the particular circumstances that Alsabah did was sufficient to create specific jurisdiction.

Failure to State a Claim

While OneUp Trader is correct that short, common phrases may not be copyright-protectable, OneUp Trader failed to address Topstep Trader’s argument that it is the combination of elements such as text, graphic size screen layouts, colors, charts, unique terms, etc. that is protectable. And even if the alleged copying identified in the complaint was only a small portion of the total content, that could be sufficient. Topstep Trader did not need to detail each copied element. It was enough to provide examples of the copying at the complaint stage. And a review of the exhibits showed sufficient alleged copying.

The Court dismissed Topstep Trader’s breach of contract claim, but gave Topstep Trader leave to replead with sufficient facts to show that a contract was formed that would support Topstep Trader’s breach claim.

Finally, Alsabah argued that the claims against him should be dismissed because the complaint only specifically mentioned him in limited instances. Topstep Trader, however, defined a term that combined OneUp Trader and Alsabah and referred to it collectively throughout the complaint.

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Kolcraft Enters., Inc. v. Chicco USA, Inc., No. 09 C 3339, Slip Op. (N.D. Ill. Apr. 13, 2018) (Chang, J.).

Judge Chang construed claims in this patent dispute involving infant play gyms for a second time, this time focused upon certain apparatus claims.

Of particular note, the Court construed the following:

  • “Connector” was not a means plus function term. It was “clearly” a structural term and would be understood as such by one of ordinary skill in the art. This was supported by the specification, which “frequently” used “connector” to denote structure. While Federal Circuit decisions construing “connector” in relation to other patents were not controlling, they were instructive because of similarities between the patent in suit and the patents in the Federal Circuit cases.
  • “Fastener” disclosed sufficient structure. It is a commonly understood noun referring to fastening or attaching structures. And the specification gave examples of fasteners, such as velcro and rivets.
  • “Pivotably coupled” was construed as “linked, connected, or fastened such that the leg [or connector] can rotate, turn, or move around a fixed point.” The Court also noted that hinges and ball-and-socket joints, which are bendable joints, could be included within pivotably coupled joints.
  • The reference to plural “connectors” was not indefinite for failing to specifically identify which connectors were referred to. The plural connectors could be either the “at least one connector” and/or the “plurality of connectors.” The Court did, however, note that if further evidence suggested that “connectors” was not an umbrella term referring to either or both sets of connectors, the parties could later raise the issue for reconsideration.
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The Intellectual Property Law Association of Chicago (IPLAC) Women in IP Committee is hosting its Annual Progressive Dinner on Thursday, June 7, 2018. The committee will celebrate the advancement of women in Chicago’s IP community through a three-course dining and networking experience.

The event is being held at Beatrix, 519 North Clark Street in Chicago. Doors open at 5:30 pm with dinner beginning promptly at 6:00 pm. The evening is $50 for IPLAC members and $65 for non-members, inclusive of dinner and drinks. Click here to register.

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The Northern District of Illinois is accepting applications for a full-time United States Magistrate Judge position in the Eastern Division (Chicago). The deadline for applying is 4:30 p.m. on Friday, May 18. The appointment will begin February 1, 2019.

To be qualified for appointment as a United States Magistrate Judge, an applicant must

  1. be, and have been for at least five years, a member in good standing of the bar of the highest court of a State, the District of Columbia, the Commonwealth of Puerto Rico, or the Virgin Islands of the United States, and have been engaged in the active practice of law for a period of at least five years;
  2. be competent to perform all of the duties of the office; be of good moral character; be emotionally stable and mature; be committed to equal justice under the law; be in good health; be patient and courteous; and be capable of deliberation and decisiveness;
  3. be less than seventy years of age; and
  4. not be related to a judge of the district court.

Applicants must not seek interviews with or submit letters of reference to individual judges or members of the Merit Selection Panel. All applications must be submitted through the U.S. District Court’s application website. For more information click on the following link: U.S. Magistrate Judge Vacancy

A Merit Selection Panel composed of attorneys and other members of the community will review all applications and recommend to the judges of the Court in confidence, a list of the persons whom it considers best qualified. The Court will make the appointment following a Federal Bureau of Investigation full-field investigation and Internal Revenue Service tax check of the person selected to fill the position. An affirmative action effort will be made to give consideration to all qualified candidates, including women and members of minority groups.

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On Thursday, May 10, 2018, from 4:30-7:00 pm, the Intellectual Property Law Association of Chicago (IPLAC) is sponsoring a panel presentation on European patent strategies by Albert Keyack, EPO Attaché to the USPTO & Dr. Frank Feller, European Patent Attorney, moderated by George Jonas, Esq., Downstream Managing Counsel, Global Patents and Technology, BP America, Inc. The panel will discuss strategies for obtaining European patents and overcoming common issues, with discussion to include: intermediate generalization, opposition strategies, and the state of the Unitary Patent.

The presentation will be held at SRAM headquarter, 1000 West Fulton Market, 4th Floor, Chicago, Illinois 60607. There is no cost for the program, but you must register here.

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Chicago IP Litigation by R. David Donoghue - 3M ago

The Intellectual Property Law Association of Chicago is holding its annual meeting Tuesday, May 1, 2018 at the University Club of Chicago. The reception begins at 5:30 pm with dinner following at 6:00 pm. There is no charge for current members, but you must RSVP here to attend. Please RSVP by no later than 5:00 p.m. on Friday, April 27, 2018. You can renew membership online.

During dinner, IPLAC will present the 2018 Creator of the Year Award, present scholarship awards to Chicago Public School seniors and elect the officers and board members for the 2018-19 year.

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DRL Enters., Inc. v. North Atlantic Op. Co., Inc., No. 16 C 8384, Slip Op. (N.D. Ill. Mar. 12, 2018) (Castillo, C.J.).

Judge Castillo denied plaintiff DRL’s motion for summary judgment that defendants lacked standing to seek cancellation of DRL’s trademark registrations in this appeal of the Trademark Trial and Appeal Board (“TTAB”) cancellation decision regarding DRL’s 1.0, 1.25 and 1.5 marks for use with tobacco rolling papers.

As an initial matter, the Court warned the parties that responding to a Local Rule 56.1 statement of undisputed material facts challenging the materiality of a fact without admitting or denying its truth was both “unhelpful” and improper pursuant to the Local Rules which require a direct admission or denial.

Regarding standing, the Court held as follows:

  • While defendants told DRL they would use fractions instead of DRL’s 1.25 and 1.5 decimal trademarks, defendants made no binding commitment to do so. Defendants also noted that their decision was solely based upon litigation avoidance.
  • Defendants also qualified their agreement saying it was “without prejudice and not to be deemed binding through contract, estoppel or otherwise.” DRL registered its dissatisfaction with defendants’ qualifications when they were made.
  • The fact that DRL and defendants were competitors would ordinarily be sufficient to create standing by giving defendants a real interest in the cancellation proceedings.
  • To the extent that the competitive relationship was not enough, DRL’s cease and desist letter would create standing.
  • While defendants’ distribution agreement preventing defendants from using the decimal marks could be seen as removing standing, a reasonable fact-finder could find that the limitation was based solely upon DRL’s trademarks and that, therefore, the restriction would be removed upon cancellation of the marks. Therefore, defendants could be found to have standing.

Having denied DRL’s summary judgment motion regarding standing, the Court ordered each party to reevaluate their settlement positions and exhaust all settlement possibilities.

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Illinois Tamale Co. v. El-Greg, Inc., No. 16 C 5387, Slip Op. (N.D. Ill. Mar. 29, 2018) (Kennelly, J.).

Judge Kennelly denied plaintiff Illinois Tamale’s and defendant El-Greg’s cross-motions for summary judgment in this Lanham Act dispute regarding Illinois Tamale’s PIZZA PUFFS trademarks.

As an initial matter, the Court refused to consider any crowd-sourced definition of a term. Because the definition could be edited by anyone, it is not sufficiently reliable and, therefore, not admissible.

El-Greg offered “significant evidence” suggesting that PIZZA PUFF was generic. On the other hand, Illinois Tamale produced evidenced from which a reasonable fact-finder could “just as well” find that PIZZA PUFF was not generic as used to denote Illinois Tamale’s products. Because of the conflicting evidence and the ability to draw conflicting conclusions, the Court denied summary judgment as to both parties’ genericness summary judgment motions.

Illinois Tamale produced sufficient evidence to permit a reasonable factfinder to conclude that Illinois Tamale had a valid family of PUFF marks. For example:

  • Illinois Tamale began selling products using Pizza Puffs, Taco Puffs, Beef Puffs and Sloppy Joe Puffs by at least the mid-1980s, before El-Greg began using its marks.
  • According to Illinois Tamale’s survey, 43% of respondents believed that Pizza Puffs and Taco Puffs were from the same or affiliated companies. Additionally, 35.5% believed the same for Pizza Puffs and Sloppy Joe Puffs.

While the factfinder may ultimately decide the case the other way, Illinois Tamale provided sufficient evidence to avoid summary judgment.

The Court held that there was a question of fact as to the last element of El-Greg’s fair use defense – whether El-Greg used the PIZZA PUFF mark “fairly and in good faith.” Because the analysis is inherently subjective, El-Greg’s undisputed awareness of Illinois Tamale’s PIZZA PUFF mark and its product labels were insufficient for summary judgment of no fair use.

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