Intuit, Canadian Generics, Lady Gaga: Intellectual Property

Intuit Inc. (INTU) won an exemption from a U.S. ban on tax-strategy patents, securing a change in legislation that would benefit its TurboTax software.

Intuit sought the exemption, which was added March 7 to a patent bill that the Senate passed March 8. H&R Block Inc. (HRB), which also makes tax-preparation software, said the exemption was unnecessary.

“We don’t want to harm tax-prep software,” said Mat Young, director of congressional and political affairs at the American Institute of Certified Public Accountants in Washington, which backs the ban on strategy patents. “But the case has not been made that this is going to be detrimental to those lines of businesses.”

Julie Miller, an Intuit spokeswoman, said the revised wording was “an improvement” over the initial provision.

Intuit, which also makes Quicken and QuickBooks financial management software, reported $3.46 billion in revenue in the fiscal year ended July 31. One-third of its revenue came from its consumer tax business. The Mountain View, California-based company holds patents for a variety of software processes related to organizing and filing tax forms.

Consumer advocates, attorneys and accountants have been seeking to eliminate tax-strategy patents. They say the patents add complexity to the tax code and limit taxpayers’ ability to use legitimate tax-reduction strategies.

Senators Charles Grassley, an Iowa Republican, and Max Baucus, a Montana Democrat, had included language in the bill that would make it impossible to patent tax strategies.

In a March 3 floor speech, Grassley said lawmakers and patent officials agreed that tax-preparation software wasn’t considered a tax strategy and wouldn’t be affected by the ban.

Grassley still offered an amendment narrowing the scope of his proposal “to allay the concerns of Intuit.” The amendment, written with Baucus, chairman of the Senate Finance Committee, exempted computer products “used solely for preparing a tax or information return or other tax filing.”

The amendment, narrower than a proposal from Nevada Republican John Ensign, was adopted without a roll call vote.

“The amendment makes it clearer that tax software isn’t included,” Kate O’Neill Rauber, a spokeswoman for Kansas City, Missouri-based H&R Block, said in an e-mail. “We were comfortable with the original language.”

The patent bill next goes to the House of Representatives.

“I fully expect that this conversation will continue through the entire debate on patent reform,” said Young of the accountants’ group.

Kongsberg Unit Accused of Infringing Weapons Systems Patents

Kongsberg Gruppen SA’s Kongsberg Defense unit was sued for patent infringement by a Pennsylvania man who accused the Norwegian contractor of infringing three patents for an acoustical and optic weapons-detection system.

The suit was filed March 8 in Harrisburg, Pennsylvania, federal court by Thomas Smith of York County, who said Kongsberg’s Crows II gunfire detection and countermeasure weapon machinery infringes his patents 5,970,024, issued in October 1999; 6,215,731, issued in April 1999; and 6,621,764, issued in September 2003.

The technology covered by the patents is used to detect gunfire and the region of its origin.

Kongsberg, based in the Norwegian city of the same name, supplies military equipment to a number of different nations. Last April, the company won a 1.2 billion kroner ($220 million) contract from the U.S. Army relating to weapons stations.

The company didn’t respond to an e-mail requesting comment.

Smith, who heads New Century Engineering, said Kongsberg’s infringement is deliberate. He asked the court to order the Norwegian company to quit infringing his patents and for money damages, attorney fees and litigation costs.

He asked that the damages be tripled to punish Kongsberg for “willful, deliberate and intentional infringement.”

Smith is represented by Kathryn L. Simpson of Mette, Evans & Woodside in Harrisburg, and David J. DeToffol of New York’s DeToffol & Associates.

The case is Smith v. Kongsberg Defense Corp., 1:11-cv- 00437-WWC, U.S. District Court, Middle District of Pennsylvania (Harrisburg).

Canada’s Clement Says Access-to-Medicines Bill Wouldn’t Work

Canadian Industry Minister Tony Clement said he’s opposed to a bill that aims to streamline the process for letting generic-drug makers produce patented medicines for export to poor nations at cheaper prices.

Clement, speaking to reporters yesterday in Ottawa, said he’s concerned the bill will serve “commercial,” not humanitarian, interests. Clement also said he doesn’t think Canadian companies can produce generic drugs cheaply enough for the legislation to be effective.

Rx&D, the association representing the drug industry in Canada and counting New York’s Pfizer Inc. (PFE) and Novartis AG (NOVN) of Basel, Switzerland, among its members, says the legislation -- which was scheduled for a vote yesterday -- would gut intellectual property rights and may undermine research in the country.

“I don’t think this bill is helpful,” Clement said, adding there is a “lot to go” before the legislation would be signed into law.

Even if the bill is passed by the House of Commons, where the ruling Conservative party holds only a plurality of seats, it will need to win approval by the Conservative-controlled Senate.

“Without the proper intellectual property regime, we can’t continue to do the research we want to do,” Russell Williams, president of Rx&D, told Bloomberg News last year. He said the changes could impose “serious” costs on the industry.

Toronto’s Apotex Inc., a generic drugmaker that is the only manufacturer to have sought a license to export pharmaceuticals to poor countries under the current law, released a March 8 statement backing the proposed changes.

“Apotex is the only company to have attempted to work through this complex legislation and it took four long years to send the first shipment of medicines via this cumbersome process,” the company said in the statement.

Canada’s so-called access-to-medicines law was enacted in 2004. Bill C-393, sponsored by a lawmaker from the opposition New Democratic Party, would amend that legislation to make it easier for generic-drug producers to obtain licenses.

For more patent news, click here.

Trademark

Gabbanelli Sues Spanish Company for Infringing Accordion Marks

Gabbanelli Accordions & Imports LLC, a Houston-based maker of accordions used in Texas conjunto and Cajun music, sued a Spanish company for trademark infringement.

Folk Music SL of Navarra, Spain, is accused of infringing the Gabbanelli trademarks and of selling fake versions of the Texas company’s products.

According to the complaint filed March 8 in Houston federal court, Folk Music offers fake Gabbanellis through a variety of websites -- www.gabbanelli.es, www.folkmusic.es and www.boppolaaccordions.com -- and also promotes the products on Facebook Inc.’s social media site.

Gabbanelli also accused Folk Music of providing customers with written guarantees that the fake instruments are authentic.

Folk Music didn’t respond to an e-mailed request for comment. Apolinar Cruz Garcia, Boppola Accordions’ director of marketing, said in an e-mail that his company sells only Boppola accordions and no other brand.

The Texas accordion maker claims it’s harmed by Folk Music’s activities and the public is likely to be “confused, misled or deceived.” It also told the court its reputation is damaged by what it calls “inferior” products falsely bearing its marks.

Gabbanelli asked the court to order Folk Music to halt its infringing activities and for money dames, profits Folk Music acquired through the alleged infringement, and attorney fees and litigation costs.

Gabbanelli is represented by Anthony F. Matheny of New York’s Greenberg Traurig LLP.

The case is Gabbanelli Accordions & Imports LLC v. Folk Music SL, 4:11-cv-00850, U.S. District Court, Southern District of Texas (Houston).

Limited Suit Says ‘Twilight’ Mark Not Limited to Movie Studio

Limited Brands Inc. asked a Manhattan federal court to declare that products made by its Bath & Body Works unit don’t infringe trademarks associated with the “Twilight” series of vampire novels and movies.

In a suit filed March 8, the New York-based clothing and cosmetics retailer said it has been threatened with an infringement lawsuit by Summit Entertainment LLC, the studio that releases the “Twilight” films. Limited said it first received a cease-and-desist letter Nov. 1.

Summit, based in Santa Monica, California, objected to the “Twilight Woods” line of products in Bath & Body Works’ Signature Collection, Limited said. According to court papers, other lines in the collection also suggest darkness or night: “Midnight Pomegranate,” “Moonlight Path” and “Black Amethyst.”

Limited said it doesn’t use the word “Twilight” alone on its labels. The word “Woods” in its product names “is frequently depicted more prominently than the word ‘Twilight’; and in fact, it often appears in a larger font size,” the company said in its pleadings.

Limited, based in Columbus, Ohio, said that when Summit applied to register “Twilight” for cosmetics and fragrances, the U.S. Patent office initially refused to register the mark because of a likelihood of confusion with registrations held by Coty Inc.’s Coty Prestige Lancaster Group.

The suits asks the court to find that Limited isn’t infringing the marks associated with the “Twilight” films and books, and for an order barring Summit from pursuing or threatening any infringement action against Limited with reference to its “Twilight Woods” products.

Limited also asked for attorney fees and litigation costs.

According to Bloomberg data, Summit has filed at least three trademark-infringement suits related to the “Twilight” marks since October 2009.

Limited is represented by Dale M. Cendali and Courtney Farkas of Chicago’s Kirkland & Ellis LLP.

The case is Bath & Body Works Brand Management Inc. v. Summit Entertainment LLC, 1:11-cv-01594, U.S. District Court, Southern District of New York (Manhattan).

For more trademark news, click here.

Copyright

Lady Gaga Demands Copyright Ownership of Photos, Website Says

Lady Gaga, the U.S. pop singer who has already objected to London breast-milk ice cream makers’ calling their product “Baba Gaga,” is now claiming she owns the copyrights of photos taken of her, a Washington news website reported.

According to a photo release form posted on TBD.com, a Washington-area news blog, photographers must agree that “all right, title and interest (including copyright)” to the pictures “shall be owned by Lady Gaga.”

The release, obtained by a photographer for TBD.com, specifies that the photos can be displayed on the blog for only four months and that Lady Gaga has the right to withdraw her permission to display them at any time.

For more copyright news, click here.

IP Moves

Szaferman Lakind Expands IP Practice by Hiring Richard Catalina

Szaferman, Lakind, Blumstein & Blader PC, the Lawrenceville, New Jersey-based law firm, said it hired Richard A. Catalina Jr. for its intellectual property practice.

Catalina previously practiced with his own firm, Catalina & Associates, of Princeton, New Jersey, Szaferman said in a statement. He has done patent-acquisition, licensing and IP portfolio-management work.

He has represented clients whose technologies have included free-space optical communications and defense systems, biotechnology, sports nutrition and nutraceuticals, software development, voice over Internet protocols and wireless networks, business methods, mechanical applications, computer hardware, electrical devices and pharmaceuticals.

Catalina has an undergraduate degree in biology and chemistry from Trenton State College and a law degree from Syracuse University.

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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