Danisco, Goldman, JetBlue: Intellectual Property

Danisco A/S lost a U.S. court bid to invalidate a Novozymes A/S patent for an enzyme used in biofuel production, allowing the case to go to trial this year.

Novozymes is suing Danisco, which is subject to a takeover offer from DuPont Co., contending its smaller Danish rival infringes a patent on an alpha amylase enzyme that remains active in high temperatures. In counteraction, Danisco had asked the court for a summary judgment that the patent was invalid.

In dispute is patent 7,713,723, which was issued May 11, 2010, the same day the case was filed in federal court in Madison, Wisconsin.

“I conclude that defendants haven’t met their burden to prove by clear and convincing evidence that the ‘723 patent is invalid as a matter of law,” U.S. District Judge Barbara Crabb wrote in her Feb. 4 decision, adding she still has “doubts” over whether the patent gives an adequate description of Novozymes’ product.

Novozymes, based in Bagsvaerd, Denmark, and Copenhagen- based Danisco are the world’s biggest makers of enzymes that break down organic material, such as grain and corn, to form bioethanol, which is used as an alternative to fossil fuels.

The case will now go to a full trial in October, Annegrethe Jakobsen, a Novozymes spokeswoman, said by telephone. She declined any further comment.

“It’s not unusual that the court doesn’t grant a motion such as this in an early phase of a trial,” Soonhee Jang, Danisco’s chief intellectual property counsel, said in an e- mail. “We are still confident and will go forward with the trial. We believe we will prevail.”

Danisco’s board last month recommended a $5.8 billion bid from Wilmington, Delaware-based DuPont. The offer is pending shareholder approval.

The case is Novozymes A/S v. Danisco A/S, 10-cv-251, U.S. District Court for the Western District of Wisconsin (Madison).

Goldman Tax Patent Won’t Have Imitators Under Bill

Goldman Sachs Group Inc. has patented a strategy that cuts taxes on executive pay. Merrill Lynch & Co. holds one for a computer program maximizing the tax benefits of a medical savings account. They could be among the last of their kind as Congress considers outlawing such proprietary claims.

A decade after an appeals court ruled that it is possible to patent a method of conducting business, the Senate Judiciary Committee on Feb. 3 voted unanimously to advance legislation that would stop the U.S. Patent and Trademark office from awarding exclusive rights to profit from tax-savings methods. The provision is part of a broad overhaul of patent laws.

Congress is acting after the U.S. Supreme Court last year ruled that business methods are eligible to receive patents. Lawmakers said that in extreme cases such patents could encourage tax avoidance and the creation of illegal tax shelters. They also could raise costs for taxpayers who follow legal methods of reducing their tax liability.

“If firms or individuals were able to hold patents for these strategies, some taxpayers could face fees simply for complying with the tax code,” said Iowa Senator Charles Grassley, the top Republican on the Senate Judiciary panel. “Tax patents provide windfalls to lawyers and patent holders by granting them exclusive rights to use tax loopholes.”

About 130 tax-strategy patents have been issued since 1998, the year the appeals court ruled business methods can be patented. Another 150 applications are pending, according to AICPA. The coalition last week warned Grassley and Senate Judiciary Committee Chairman Patrick Leahy of Vermont that the tax patents could increase costs for law-abiding taxpayers.

“No one should risk facing royalties or lawsuits just for complying with federal tax law,” said Mat Young, director of congressional and political affairs at the AICPA.

That’s the situation that faced John W. Rowe, the former executive chairman of Aetna Inc., in 2006. The owner of a patent that funded so-called grantor retained annuity trusts with executive stock options sued Rowe when he used the strategy. Rowe settled in 2007, sidestepping a court ruling on the issue. The terms of the settlement weren’t disclosed.

Also, Congress in 2010 changed the law to deny some of the benefits derived from the Goldman Sachs patent.

Critics of such patents had predicted that the Supreme Court would scale back their use after an appeals court specializing in patent law ruled that patents must be connected to a machine or somehow transform an item.

Instead, the high court in June ruled that the test was too rigid, even as it said business-method patents “raise special problems in terms of vagueness and suspect validity.”

The Senate legislation would block applications for such strategies from being filed with the U.S. Patent and Trademark Office. Inventions based on publicly available information, known as “prior art,” can’t be patented; the Senate bill would designate all tax-avoidance strategies prior art.

The Internal Revenue Service proposed regulations in 2007 that would provide extra scrutiny to tax filings that used a patented strategy. That regulation isn’t yet final.

The tax patent issue is a small part of the broader proposal before Congress, which is considering the biggest changes to U.S. patent law since 1952.

For more patent news, click here.

Trademark

JetBlue, New York Tourism Begin Co-Branding ‘Heart’ Campaign.

JetBlue Airways Corp. rolled out its first aircraft marked with the co-branded trademark “I heart Blue York,” the New York-based company said in a statement yesterday.

The airline’s new livery represents a partnership with New York’s “I heart New York” tourism campaign and logo.

The logo is placed on the aircraft’s tailfin and was created in collaboration with Milton Glaser, who designed the original New York tourism trademark in 1975, according to the statement. The joint campaign with JetBlue marks the first time the mark been co-branded for use with another entity, according to the statement.

As part of the campaign, short films promoting New York State as a tourism destination will be shown in the airline’s in-flight seatback program. The films were created in cooperation with students at New York University’s Tisch School of the Arts Graduate School of Film.

For more trademark news, click here.

Copyright

Movie Studios Sue Hotfile.com Over Infringement Claims

A Walt Disney Co. unit and four other movie studios sued the operators of Hotfile.com for copyright infringement, claiming the website facilitates the theft of motion pictures and television content.

News Corp.’s Twentieth Century Fox Film Corp., Universal City Studios Productions LLLP, Sony Corp.’s Columbia Pictures Industries Inc. and Time Warner Inc.’s Warner Bros. Entertainment Inc. joined Disney in the suit, according to a complaint filed yesterday in federal court in Miami.

“Hotfile is a commercial online hub for distributing popular entertainment content without authorization, including hundreds of thousands of copies of the plaintiffs’ copyrighted works,” according to the complaint.

Users of Hotfile pay a monthly fee to download content, including movies playing in theaters, from the company’s computer servers, the studios said in their complaint. Hotfile is operated by Florida resident Anton Titov, who is also a named defendant, according to the filing.

Titov and a Hotfile representative didn’t immediately return an e-mail message seeking comment.

The Motion Picture Association of America Inc. announced the suit in a statement yesterday.

The case is Disney Enterprises Inc. v. Hotfile Corp., 11- 20427, U.S. District Court, Southern District of Florida (Miami).

Righthaven Seeks Award of Duke’s WhiteCivilRights.com Domain

Righthaven LLC, which has filed more than 175 copyright infringement lawsuits on behalf of Stephens Media Group’s Las Vegas Review-Journal, sued David Duke for copyright infringement.

The lawsuit was filed on behalf of the Denver Post, which isn’t a Stephens Media product. Righthaven claims that it owns the copyright that was infringed. The Post is owned by Affiliated Media Inc., the closely held holding company of William Dean Singleton’s MediaNews Group Inc.

Duke, a former candidate for the governorship of Louisiana, is accused of posting a photo from the Denver Post on his website, www.whitecivilrights.com. Co-defendant with Duke is the European-American Unity and Rights Organization, a group he founded.

According to the complaint filed Feb. 4 in federal court in Denver, Duke posted a photo of an airport pat-down searches conducted by an agent of the Transportation Security Administration.

Righthaven, based in Las Vegas, said it will be “irreparably harmed” if the alleged infringement continues. It asked the court to bar any use of its content by Duke and EURO, and seeks to be awarded the www.whitecivilrights.com domain name, in addition to money damages, attorney fees and litigation costs.

The copyright holder is represented by in-house counsel Steven G. Gamin and by Shawn A. Mangano of Shawn A. Mangano Ltd. of Las Vegas.

Duke didn’t respond immediately to an e-mailed request for comment.

The case is Righthaven LLC v. European-American unit and Rights Organization, 1:11-cv-00307-LTB, U.S. District Court, District of Colorado).

Mardi Gras Indians Register Copyrights for ‘New Suits’

Every year at Carnival time in New Orleans, each member of the Mardi Gras Indians makes a new suit to be worn Mardi Gras Day and later on “Super Sunday,” or the Sunday nearest St. Joseph’s Day, March 19.

The Mardi Gras Indians, who are black members of so-called tribes with names like the Wild Tchoupitoulas, the Golden Arrows and the Morning Star Hunters, have a long tradition of creating fanciful beaded and feathered costumes.

The costumes may cost $2,000 and weigh as much as 150 pounds. They are displayed in street parades, and the practice of costume-making is the subject of a popular Mardi Gras song by the Wild Magnolias tribe, “Every Year at Carnival Time We Make a New Suit.”

This year, Ashlye M. Keaton, a lawyer, is working with the Mardi Gras Indian Council Inc. and the nonprofit Sweet Home New Orleans to help the Indians register and enforce the copyrights to their costumes.

Keaton, also an adjunct professor at Tulane University Law School, said in an e-mail that the Indians will enforce their rights against sellers of images that infringe their art. The Indians seek to encourage photographers and artists to get written permission to feature the costumes, she said. If no permission is obtained, and if negotiations and cease-and-desist notices fail, the Indians can consider litigation, according to Keaton.

Thousands of photos are shot of the Indians every year, and Keaton says it’s important “to distinguish public street scenes from derivative works.”

Mardi Gras falls on March 8 this year, and the “Super Sunday” parade is set for March 20, according to the Mardi Gras Digest website.

For more copyright news, click here.

IP Moves

Wilmer Cutler Hires Ex-Howrey Partner Galvin for IP Group

Wilmer Cutler Pickering Hale & Dorr LLP hired Robert Galvin for its Silicon Valley intellectual-property group, the Washington-based firm said in a statement.

Galvin, a litigator, joins from Washington’s Howrey LLP. He previously practiced at Cupertino, California’s Day Casebeer Madrid & Batchelder LLP, which merged into the Howrey firm in July 2009. He also previously practiced at the San Francisco firm now know as Cooley Godward Kronish LLP.

He has represented clients in the biotechnology and software industries in intellectual-property and antitrust disputes, and on licensing issues. Before he began the practice of law, he served as a clerk for Judge Stephen S. Trott of the 9th U.S. Circuit Court of Appeals.

Galvin has an undergraduate degree and a law degree from the University of California at Los Angeles.

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

To contact the editor responsible for this story: David E. Rovella at drovella@bloomberg.net.

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