Toyota, Axcess, Pearls, Sify, AshleyMadison.com: Intellectual Property

Toyota Motor Corp., the world’s biggest automaker, settled a patent-infringement dispute that had threatened U.S. imports of its newest hybrid vehicles, including the Prius.

The agreement with Paice LLC, ending six years of litigation, was announced yesterday as a hearing was to begin on a claim against Toyota before the U.S. International Trade Commission in Washington. Terms weren’t disclosed and lawsuits pending in Texas and at a U.S. appeals court will be dismissed.

Paice founder Alex Severinsky, a Soviet emigrant who began his career developing antitank-warfare instrumentation, had said his 1994 patented system for a high-voltage method to power gas- electric hybrid cars was used by Toyota without permission. Severinsky, 65, has sought royalties from the automaker.

Ford Motor Co., maker of the Fusion hybrid car, agreed to license Paice’s technology, the companies said on July 16 without revealing terms.

The Paice patent covers a way to supply torque to a car’s wheels from both an electric motor and internal combustion engine using a combination of high voltage and low current.

Toyota, which was found to have infringed the patent in an earlier case, had said its hybrid vehicles are the result of its own research and asked the trade commission to deny Severinsky’s latest claims.

“The parties agree that, although certain Toyota vehicles have been found to be equivalent to a Paice patent, Toyota invented, designed and developed the Prius and Toyota’s hybrid technology independent of any inventions of Dr. Severinsky and Paice as part of Toyota’s long history of innovation,” both companies said in separate statements.

The ITC is an independent agency set up to protect U.S. markets from unfair trade practices. When a violation is found, it has the power to block imports of products and typically sides with patent owners unless there are health or public- policy issues.

The issue in the trial that was to begin today hinged on which is more important: Severinsky’s right to protect the millions of dollars invested in his invention or the potential economic harm of banning Toyota’s hybrid-vehicle imports.

ITC Judge Theodore R. Essex had said Toyota couldn’t try to reargue the validity of the patent or whether it’s infringed, leaving open the question of whether Paice has a domestic market to protect, and if it was in the public interest to issue a ban.

Citing potential job losses, lawmakers wrote the ITC to side with Toyota. Among them were Senate Republican Leader Mitch McConnell of Kentucky, who has a Toyota plant in his state that makes hybrid vehicles, and Democratic Representative Travis Childers of Mississippi, where Toyota is building a factory.

Toyota is the biggest seller of hybrid vehicles in the U.S. In June, the company sold 14,639 hybrids in the U.S., including 1,933 Lexus hybrids, about 10 percent of its total sales. The ITC’s case related to the company’s current, third-generation Prius as well as the Camry hybrid, Lexus HS250h and Lexus RX450h.

Toyota was found in a 2005 trial to have infringed Severinsky’s patent on torque technology used in earlier versions of the Prius, Lexus RX400h and hybrid Toyota Highlanders. A federal jury awarded $4.27 million to the company Severinsky founded, Bonita Springs, Florida-based Paice.

The judge declined to halt sales of the hybrids, and instead told the automaker to pay Paice $25 for every car. He later raised the amount to about $98 after an appeals court ordered a recalculation. Toyota appealed that decision.

If the $98 rate were applied to all of Toyota’s hybrids now on sale in the U.S., the company would have to pay $1.43 million in royalties for June alone. The company reported fourth-quarter net income of 112 billion yen ($1.27 billion) on May 11.

Paice Chairman Frances M. Keenan, vice president of finance at Baltimore’s Abell Foundation that has invested $20 million in Paice since 1998, declined to say if the company is talking to additional automakers about licensing the Paice patent.

The ITC case is In the Matter of Hybrid Electric Vehicles, 337-688, U.S. International Trade Commission (Washington). The civil cases are Paice LLC v. Toyota Motor Corp., 04-cv-211; 07cv180 and 08-cv-261, U.S. District Court, Eastern District of Texas (Marshall).

Axcess Sues Baker Botts for Patent-Related Malpractice

Axcess International Inc., a provider of radio-frequency identification technology, sued Houston’s Baker Botts LLP for malpractice.

The complaint, filed in federal court in Dallas July 15, relates to patent-application work the firm did for Axcess, and, Axcess claims, its competitor Lockheed Martin Corp.’s SAVI Technologies unit.

Addison, Texas-based Axcess claims Baker Botts was pursuing patents in the same field for its competitor SAVI at the same time it was working on Axcess’ behalf. According to court papers, both companies received patents for what is known as RFID technology.

SAVI’s patents enabled that company to obtain contacts with the U.S. Department of Defense worth more than $1 billion and have its specifications incorporated as industry standards, Axcess claimed in its pleadings.

These patents covered technology disclosed in some of the Axcess applications handled by Baker Botts, according to court papers.

Axcess accused Baker Botts of negligence and “conscious indifference” to its client’s rights and economic welfare. It asked the court to award it money damages, attorney fees and litigation costs.

Michael A. Cinelli, a spokesman for the firm, said Baker Botts had reviewed the complaint and believes “it is without merit.”

Axcess sued SAVI in the same court in May 2010. The complaint accused the Lockeed Martin unit of infringing two patents, one of which had been handled in the application process by Baker Botts, according to court papers. The disputed patents are 6,294,953, issued in September 2001; and 7,271,727, issued in September 2007.

In the patent case, Axcess is represented by Kevin P. Perkins and Kenneth W. Biermacher of Kane Russell Coleman & Logan PC of Dallas.

The case is Axcess International Inc., v. Savi Technologies Inc., 3:10-cv-01033-F, U.S. District Court, Northern District of Texas (Dallas).

In the case against Baker Botts, Axcess is represented by Steven E. Aldous and Robert R. Varner Jr. of Dallas-based Braden Varner & Aldous PC.

The case is Axcess International Inc. v. Baker Botts LLP, 3:10-cv-01383-K, U.S. District Court, Northern District of Texas (Dallas).

Bayer Sues Lupin to Block Copies of Yaz, Yasmin Contraceptives

Bayer AG, the world’s biggest maker of birth-control pills, sued Lupin Ltd. to prevent sales of generic copies of the Yaz and Yasmin contraceptives in the U.S.

Lupin is seeking U.S. Food and Drug Administration approval to sell lower-cost versions of the pills, Bayer said in a July 15 lawsuit in federal court in Baltimore, where Mumbai-based Lupin has offices. Bayer wants the court to block approval until a patent expires in 2013 and three others expire in 2014.

The Yasmin family of contraceptives is Leverkusen, Germany- based Bayer’s top-selling pharmaceutical, generating about 1.28 billion euros ($1.7 billion) in revenue last year, according to company filings. As part of its FDA applications, Lupin said its versions of the drugs wouldn’t infringe the patents or that the patents are invalid, according to Bayer’s complaint.

An official with Lupin in Maryland didn’t immediately return a message seeking comment.

Bayer is represented by Michael James Wasicko and Charles P. Goodell Jr., of Baltimore’s Goodell, DeVries, Leech & Dann LLP.

The case is Bayer Schering Pharma AG v. Lupin Ltd., 10cv1914, U.S. District Court for the District of Maryland (Baltimore).

For more patent news, click here.

Trademark

No ‘Pearl’ Permitted for New Dehli Fashion Week, Court Rules

Pearls Infrastructure Projects Ltd., an Indian real-estate development company, and the Fashion Design Council of India can’t use the word “Pearl” in connection with the six-day couture event they’re sponsoring, Sify Technologies Ltd.’s SifyNews reported.

Justice S. Ravindra Bhat of the Delhi High Court yesterday barred the use of “Pearl” following a claim from the Little People Education Society that trademarks associated with its Pearl Academy of Fashion, according to SifyNews.

The fashion-school proprietors argued they registered their trademarks in 1993 and have been spending money promoting the school, the news site reported.

The court said “Pearl Infrastructure Projects Ltd.,” “Pearl Tourism and “PACL” were permitted for the fashion event, set to begin in New Delhi today, according to SifyNews.

Raymond Ltd. Can’t Bar Raymond Pharmaceutical’s Use of Name

Raymond Ltd., a textile manufacturer, can’t claim Raymond Pharmaceuticals of Mumbai infringed its trademarks, the Bombay High Court ruled and India’s Economic Times reported.

The court ruled that the closely held pharmaceutical company didn’t infringe as they do not deal in the same kinds of products, according to the Economic Times.

Amit Vyas of Mumbai’s Rajani Associates, counsel for the Worli, India-based textile company told the Economic Times he would recommend the company appeal the ruling.

Vyas argued that Indian trademark law protects a famous trademark against other users, even those whose goods and services are dissimilar, according to Economic Times.

AshleyMadison.com Owner Claims AshleyMadisonsucs.com Infringes

Avid Dating Life Inc., which operates the AshleyMadison.com dating site aimed at those who want to have extramarital affairs, sued two Los Angeles residents for trademark infringement.

The suit, filed in Canadian federal court in Vancouver, claims Dennis Bradshaw’s and Lena Karachun’s AshleyMadisonSucs.com and AshleyMadisonScam.com website names are “confusingly similar” to Avid Dating’s site.

Bradshaw and Karachun “have directed public attention to their websites’ in a way that causes the public to confuse their “identity, services and business” with Avid’s, according to court papers.

Avid, based in Toronto, seeks an order barring use of its trademarks, money damages, attorney fees and litigation costs, and transfer of the domain names to which it objects.

According to the Los Angeles Times, in January 2009 Avid Dating claimed its AshleyMadison.com had 3.2 million members, with Los Angeles as its biggest market. The name “Ashley Madison” was chosen because they are currently among the most popular names given baby girls.

Avid is represented by Corey D. Steinberg of the Double Diamond Law Corp. of Whistler, British Columbia.

The case is Avid Dating Life Inc. v. Dennis Bradshaw and Lena Karachun, T-1071-10, Federal Court, Vancouver, British Columbia.

Lleyton Hewitt Fails to Block Use of ‘Come On’ Trademark

Owners of a Brisbane, Australia-based sporting goods company persuaded Australia’s trademark authority to reject a challenge to a mark made by tennis pro Lleyton Hewitt, the AdelaideNow.com news website reported.

Hewitt had claimed that John Patrick Sheils’ registration of the phrase “come on” was made to trade off the tennis star’s reputation, according to AdelaideNow.com.

The trademark hearing officer said Sheils, of Rochedale, Australia, who registered the mark in October 2004 demonstrated “genuine commercial use,” and rejected Hewitt’s claim, the news website reported.

Hewitt will appeal the ruling, AdelaideNow.com reported.

For more trademark news, click here.

Copyright

Russian Copyright Enforcement Still Problematic, Medvedev Says

Copyright enforcement problems are a barrier to Russia’s joining the World Trade Organization, President Dmitry Medvedev said, and Russia’s RIA Novosti news reported yesterday.

He said that during the Soviet era, “the protection of intellectual property rights was imperfect” and IP rights enforcement is still problematic, according to RIA Novosti.

“Russian nerds” working in California’s Silicon Valley told Medvedev on a recent visit there that they did not feel protected in Russia, RIA Novosti reported.

In addition to the issue of membership in the trade group, Medvev told RIA Novosti IP rights enforcement was also important to Russia’s inventors and authors.

Iran Amends Copyright Law, Gives More Choices to Rights Holders

Although Iran is not a member of international IP bodies, the country’s parliament has modified its copyright law to give content creators more control over ultimate uses of their work, Iran’s PressTV reported.

Writers, composers and artists now have the ability to transfer financial rights to their work to whomever they wish, according to PressTV.

Previously, the rights would go to heirs or, in the absence of heirs, the rights would be held by the government for public use, PressTV reported.

The changes affect only works produced inside Iran, according to PressTV.

For more copyright news, click here.

IP Moves

Sonnenschein Expands Silicon Valley IP Practice with New Hire

Sonnenschein, Nath & Rosenthal LLP hired Dana Finberg for its Silicon Valley IP practice, the Chicago-based firm said in a statement.

Finberg joins from Richmond, Virginia’s LeClairRyan where he headed the IP litigation practice. He’s handled patent, trademark, trade dress and copyright disputes in trial and appellate courts.

He has an undergraduate degree in English from Randolph Macon College and a law degree from the University of Richmond.

To contact the reporter on this story: Victoria Slind-Flor in Oakland, California, at vslindflor@bloomberg.net.

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.