Lily, Schlumberger, Amazon, HP: Intellectual Property (Updtae1)

Eli Lilly & Co., already facing competition next year for its top-selling drug, lost a court bid over patent protection on its cancer medicine Gemzar, which could lead to generic products as early as November.

A U.S. appeals court said yesterday a lower court was correct to invalidate a patent on a method of using the medicine that expires in 2013. The patent is almost the same as one on the compound in Gemzar that expires in November, the Court of Appeals for the Federal Circuit said in a ruling on its website.

Gemzar, used for lung, breast, pancreatic and ovarian cancers, generated $747.4 million in U.S. sales last year. Global Gemzar sales were $1.36 billion, down 21 percent from the previous year, the Indianapolis-based company said in its fourth-quarter earnings report.

“If Lilly suddenly loses more or less a billion-and-a- half-dollar drug, that’s a significant problem since they’re also losing Zyprexa next year,” Les Funtleyder, an analyst with New York-based Miller Tabak & Co., said yesterday in a phone interview. “It could have a significant impact to earnings.”

The decision is a victory for India’s Sun Pharmaceutical Industries Ltd., which had challenged the patent, and generic- drug companies including Teva Pharmaceutical Industries Ltd. and Novartis AG’s Sandoz that also are seeking to sell lower-cost versions of the medicine.

“It opens up the generic market some two years early on an incredibly important drug,” said James Hurst of Winston & Strawn in Chicago, the lawyer who represented Mumbai-based Sun.

When a drug loses patent protection, typically its sales can fall as much as 80 percent in the next two to three years, Funtleyder said. Gemzar, which is given by injection, may see revenue deteriorate more slowly because the drug is harder to make, he said. Funtleyder has a “neutral” rating on Lilly shares and doesn’t own them.

U.S. District Judge George Caram Steeh in Detroit invalidated the patent last year. Lilly continued to sue generic companies, including Sandoz and Hospira Inc., anticipating a victory at the appeals court. In March, a federal judge in Indianapolis upheld the patent that expires in 2010.

The appeals court said the 2013 patent covered an invention that was already protected through 2010. Hurst used the same double-patenting argument to invalidate Lilly’s claim on the antidepressant Prozac in 2000.

Mark Taylor, a spokesman for Lilly, said the company was preparing a statement. Denise Bradley, a spokeswoman for Petah Tikva, Israel-based Teva, said the company had no comment.

“We’re encouraged by this development and remain committed to bringing high-quality, low-price products to market as soon as possible,” said Daniel Rosenberg, a spokesman for Lake Forest, Illinois-based Hospira. A spokeswoman for Novartis didn’t immediately return a message seeking comment.

Lilly is seeking to increase the speed of drug development as it faces patent expirations on two top-selling medicines, the antipsychotic Zyprexa next year and antidepressant Cymbalta in 2013.

The case is Sun Pharmaceutical Industries Ltd. v. Eli Lilly & Co., 10-1105, U.S. Court of Appeals for the Federal Circuit (Washington). The lower court case is Sun Pharmaceutical v. Eli Lilly, 07-15087, U.S. District Court, Eastern District of Michigan (Detroit).

Schlumberger loses to EMGS in Oil-Exploration Patent Dispute

Electromagnetic Geoservices ASA said in a statement that the Court of Appeal in London ruled in favor of EMGS in a patent dispute launched by Schlumberger Ltd., “where Schlumberger sought to invalidate two of EMGS’s basic method patents.”

The patents relate to the use of electromagnetic technology to locate oil and gas deposits beneath the seabed. EMGS said July 6 that it signed a multiyear contract worth a minimum of $150,000 with Mexico’s Petroleos Mexicanos to survey the Mexican sector of the Gulf of Mexico.

In January 2009, a London trial court found three EMGS patents were invalid. At that time the company said it would appeal the ruling.

Houston’s Schlumberger will have to make an initial payment of $3.5 million to Trondheim, Norway-based EMGS. The oil exploration was also awarded its costs of the appeal in full, according to the statement.

EMGS said the court refused Schlumberger permission to appeal its ruling to the U.K’s Supreme Court.

Facebook Wins Patent Case Against Leader Technologies

Facebook Inc., owner of the world’s most popular social- networking site, won a patent case brought by Leader Technologies Inc. when a jury held the competitor’s patent invalid.

Leader sued Palo Alto, California-based Facebook in Wilmington, Delaware, in 2008 seeking royalties and an order to stop the alleged infringement. The trial began July 19.

“We thank the jury for listening carefully to all the facts,” Facebook general counsel Ted Ullyot said in a statement. “From the day this lawsuit was filed, we said the patent was invalid.”

Paul J. Andre, a lawyer for Westerville, Ohio-based Leader, said he’s confident the ruling “will not stand” in further litigation.

Leader’s patent 7,139,761, for managing electronically stored data, was awarded to inventors Michael McKibben and Jeffrey R. Lamb in 2006.

McKibben founded Leader in 1997. The company develops Internet-based systems to help businesses manage e-mail, voice mail, teleconferencing and video data, according to the company’s website.

Facebook was started in 2004 by Harvard University undergraduate Mark Zuckerberg. It reportedly had 2009 revenue of more than $700 million, and Zuckerberg is presently facing a suit in federal court in Buffalo, New York, alleging a New York resident is entitled to 84 percent of the company.

In its decision in the patent case, the jury also ruled that Facebook’s technology did infringe claims of the patent. under U.S. patent law, an invalid patent cannot be infringed.

The invalidity ruling was based on the jury’s determination that Leader failed to file its patent application within a year of offering the invention for sale, as required by law.

Alexander Poltorak, chief executive officer of patent- licensing firm General Patent Corp. of Suffern, New York, said such a finding “is very difficult to reverse on appeal. There’s no way to overcome it.” He says he’s following the trial although he has no dealings with any of the parties.

The trial was supervised by U.S. Magistrate Judge Leonard Stark.

The case is Leader Technologies Inc. v. Facebook Inc., 08- cv-862, U.S. District Court, District of Delaware (Wilmington).

For more patent news, click here.

Copyright

Amazon.com, Borders, Barnes & Noble Sued Over Mob Book Copyright

Amazon.com Inc., Barnes & Noble Inc. and Borders Group Inc. were sued for copyright infringement by the author of a book about the Mafia.

Salvatore Scorza, whose book “Mafia” was published in 2007 by Harper Collins Publishers Ltd., claims a book titled “Mafia” that the stores are selling is actually his book. The new book was published by Skyhorse Publishing Inc. of New York, he said in his complaint filed July 26 in federal court in Los Angeles.

Scorza claims the Skyhorse book “comprises identical copies of each page” from his book, including photos and textural editing. Both books contain a forward written by Sam Giancana, the nephew of the Chicago crime boss by the same name, Scorza said.

The forward written for the Skyhorse book is “substantially similar” to the one Giancana wrote for Scorza’s book, according to court papers. Scorza included photocopies of both forwards in his court filings.

Scorza said the Skyhorse edition was created by “deliberately and willfully copying each page” of his book.

He said he was harmed by the creation of what he calls the “derivative work” and included Amazon.com and the other booksellers in the complaint because they are selling and distributing copies of the Skyhorse book.

He asked the court for an award of the profits that the defendants realized through their alleged infringement, together with money damages. He also seeks an order for the destruction of the allegedly infringing book, and for the damages to be tripled to punish the defendants for their actions.

Scorza also asked for awards of attorney fees and litigation costs.

As of yesterday, the Skyhorse website listed a book “Mafia: The Government’s Secret File on Organized Crime,” and credited authorship to the United States Treasury Department. Amazon.com Inc. listed both books, with Scorza’s book selling for $250 from an affiliated retailer. The Treasury Department’s book sells for $13.98.

Scorza is represented by Kevin M. Welch of the Law Office of Kevin M. Welch of Hermosa Beach, California.

The case is Scorza v. Tony Lyons, 2:10-cv-05507-DDP-E, U.S. District Court, Central District of California (Los Angeles).

For more copyright news, click here.

Trademark

HP Seeks Trademarks for Computer, Airline Reservation System

Hewlett-Packard Co. filed a trademark application that may indicate its willingness to compete with Apple Inc.’s iPad.

The Palo Alto, California-based computer company filed an application with the U.S. Patent and Trademark Office July 10 to register “palmpad” as a trademark for computers and computer hardware.

HP acquired Palm Inc. and its mobile operating system this year for $1.2 billion.

Another recent HP trademark application relates to the company’s activities in airline-reservation software.

The company filed an application July 7 to register “agilaire” to be used with computer software for managing airline reservations and to provide leased-time access to software applications in the transportation industry.

HP signed an agreement with AMR Corp.’s American Airlines in August 2009 to develop a computerized reservation, pricing and ticketing system.

Levi Strauss Sues Four Companies for Infringing Pocket Design

Levi Strauss & Co., the San Francisco clothing company whose origins date back to the California gold rush of 1849, sued sportswear makers for trademark infringement.

The complaint, filed July 26 in federal court in Atlanta, accuses the defendants of infringing the pocket stitching design that is a trademark for Levi jeans. That looping design is known as Levi’s “Arcuate” trademark, and has been used by Levi Strauss since 1873, according to court papers.

The defendants include Skillz and Manhattan, both of Atlanta, Loops Farmer of Jersey City, New Jersey, and Member’s Property Inc. of Vernon Hill, Illinois. The allegedly offending jeans are sold under the brand names “classic blue,” “DMAR”, “DMAX,” “Members Property” and “Sky,” according to the complaint.

Levi Strauss claims the defendants have made and sold “substantial quantities” of infringing products and that it’s been harmed by their actions.

The company asked the court to order the defendants to quit selling, importing and manufacturing infringing products, and to report their “funds and assets that arise out of their infringing activities.”

Levi Strauss also asked for awards of money damages attorney fees and litigation costs, including investigative expenses, and for an order for seizure of all infringing products and promotional materials.

Levi Strauss is represented by Tywanda H. Lord of Atlanta’s Kilpatrick Stockton LLP, and Gregory S. Gilchrist, Gia L. Cincone and Ryan Bricker of San Francisco’s Townsend & Townsend & Crew LLP.

The case is Levi Strauss & Co. v. Skillz, 1:10-cv-02335- TWT, U.S. District Court, Northern District Of Georgia (Atlanta).

Blu Basil Restaurant Claims Blue Basil Infringes Marks

A North Carolina restaurant chain sued a Thai restaurant for trademark infringement.

Tuscan Sun Inc., of Charlotte, North Carolina, operates Blu Basil, an Italian-themed casual-dining restaurant in Charlotte. The company objects to a Thai restaurant in Charlotte operating under the name Blue Basil.

Blu Basil has been in operation since February 2009, and in February 2010 Tuscan Sun demanded that the proposed Thai restaurant not use the Blue Basil name, according to the complaint filed July 27 in federal court in Charlotte.

Blue Basil opened for business in April.

Tuscan Sun claims that in addition to a similar name, the Thai restaurant included the image of a plant on its signage that’s akin to the basil plant used in the Blu Basil mark.

The public is likely to be confused by the similar names and signage, and Tuscan Sun is harmed as a result, the company said in its pleadings.

Tuscan Sun asked the court to bar the Thai restaurant from using the name Blue Basil or any other name that would cause confusion with the mark. Additionally, Tuscan Sun asked for attorney fees, litigation costs and money damages, and requested that the damages be tripled to punish Blue Basil for its actions.

Tuscan Sun is represented by John C. Nipp of Charlotte’s Summ, Addition & Ashe PA.

The case is Tuscan Sun Inc. v. Blue Basil Inc., 3:10-cv- 00342-RLV-DSC, U.S. District Court, Western District of North Carolina (Charlotte)

For more trademark news, click here.

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

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