Medtronic, TiVo, Kohler, Megaupload: Intellectual Property

Medtronic Inc. (MDT)’s $101.2 million jury verdict against NuVasive Inc. over spinal surgery patents was left intact by the judge who presided over the September trial.

U.S. District Judge Michael Anello in San Diego, at a hearing yesterday, denied NuVasive’s requests to overturn the Sept. 20 jury verdict or order a new trial. Anello issued tentative rulings to that effect Jan. 25.

“The bottom line is that I now respectfully affirm my tentatives denying the motions,” the judge said.

The $101.2 million damages verdict, which was awarded after a two-week trial, was the 18th-largest jury award in the U.S. in 2011 and the fourth-largest in a patent-infringement claim, according to data compiled by Bloomberg.

After the verdict, San Diego-based NuVasive argued that the patents weren’t infringed and the jury verdict wasn’t supported by the evidence.

The judge yesterday rejected NuVasive’s claim that one of the patents in dispute is invalid, and also denied Medtronic’s request for a permanent injunction barring NuVasive from selling the devices found to infringe its patents.

Anello additionally left intact the jury’s award of $660,000 in damages to NuVasive for Medtronic’s infringement of one of its patents.

“We respectfully differ with some of the rulings and are in the process of assessing our options going forward,” Luke Dauchot, a lawyer for Medtronic, said in an interview after today’s hearing.

NuVasive’s lawyer, Frank E. Scherkenbach, didn’t immediately respond to a phone message seeking comment on yesterday’s rulings.

The case is Medtronic Sofamor Danek USA v. NuVasive Inc. (NUVA), 3:08-cv-1512, U.S. District Court, Southern District of California (San Diego).

TiVo (TIVO) Gets Order Lifting Stay of Patent Suit Against Verizon

TiVo Inc. persuaded a federal judge in Texas to lift the stay on a patent case against Verizon Communications Inc., according to court papers.

The case was put on hold after a lawsuit filed by Motorola Mobility Holdings Inc. (MMI) against TiVo also was stayed. Verizon had asked for a stay because some of the disputed patents are involved in proceedings at the U.S. Patent and Trademark Office.

The Motorola Mobility case was resumed Jan. 3, the same day TiVo announced a settlement with AT&T Inc. (T)

A status conference in the case against New York-based Verizon, filed in federal court in Marshall, Texas, has been set for Feb. 23.

The case against Verizon is TiVo Inc. v. Verizon Communications Inc, 2:09-cv-00257-DF-CMC, U.S. District Court, Eastern District of Texas (Marshall).

Star Scientific’s Patent Case With RJR Sent Out for Negotiations

Star Scientific Inc.’s 11-year-old patent infringement case against R.J. Reynolds Tobacco Co. was sent to a magistrate judge for settlement talks, according to a court document filed yesterday.

The suit, referred to U.S. Magistrate Judge Beth P. Gesner, is related to patented technology to reduce carcinogens in tobacco.

In a statement released yesterday, Star Scientific’s chairman, Paul Perito , said that moving the case to a magistrate judge “augurs well for good faith negotiations by the parties” that can lead “to a mutually acceptable global resolution” of the dispute.

The case is Star Scientific Inc. v. R.J. Reynolds Tobacco Co., 8:10-cv-01504-MJG, U.S. District Court, District of Maryland (Greenbelt).

For more patent news, click here.

Trademark

Kohler Settles Trademark Case Against Arizona Beauty School

Kohler Co. (KHCO), the Wisconsin-based maker of toilets, urinals and faucets, persuaded the operators of a cosmetology school in Scottsdale, Arizona, to change the name of their operation.

The plumbing-fixture company had objected to Jill and Burt Kohler’s use of the name “Kohler Academy” for their beauty school. They were sued for trademark infringement in federal court in Phoenix in October.

Kohler claimed that the company was damaged by the Arizona couple’s use of the name. In the complaint, the plumbing-fixture company said its trademark registrations for the name “Kohler” extended to cosmetic products and services and the public was likely to be confused by the beauty school’s making similar offerings under its name.

The Wisconsin company also objected to the school’s Internet domain names incorporating “KohlerAcademy.” Kohler asked the court to bar the Kohlers’ use of their name on the beauty school and for money damages in excess of $400,000.

According to the agreement filed with the court Jan. 25, the Arizona couple agreed to transfer the offending domain named to the plumbing-fixture company. They also agreed not to use “Kohler” in any way that would confuse the public and to cancel their Arizona trademarks for “Kohler Academy.”

Kohler was represented by Kimberly Anne Warshawsky, Paul D. McGrady Jr. and Jason B. Elster of New York’s Greenberg Traurig LLP (1153L). The Arizona couple was represented by Brian McCormack Bergin and Kenneth Michael Frakes of the Rose Law Group PC of Scottsdale, Arizona.

The case is Kohler Co. v, Milestones Group LLC, 2:11- cv-02021-NVW, U.S. District Court, District of Arizona (Phoenix).

For more trademark news, click here.

Copyright

Kim Dotcom’s Megaupload Co-Accused Granted Bail in N.Z. Court

Two men accused alongside Megaupload.com founder Kim Dotcom of the biggest copyright infringement in U.S. history were granted bail in a New Zealand court because they were found unlikely to flee the country.

The risk of Bram van der Kolk and Finn Batato trying to escape from New Zealand was low and both were of good character, North Shore District Judge David McNaughton wrote in separate rulings released by e-mail yesterday. A bail hearing for the fourth man arrested in New Zealand on Jan. 20 was adjourned until today, according to a court spokesman.

Dotcom and his colleagues are sought in the U.S., where they were indicted on charges that the file-sharing website was part of a $175 million copyright-infringement conspiracy with pirated film and music files being exchanged. He was arrested at his leased New Zealand mansion on Jan. 20, and the U.S. has 45 days from that date to file a formal extradition request.

“I am mindful of the scale of the offending described in the indictment and that this is the biggest case of its kind prosecuted in the United States,” McNaughton wrote. “It is safe to assume that substantial terms of imprisonment would be imposed.”

Van der Kolk and Batato were remanded in custody for a week while their homes were assessed for electronic monitoring, according to stuff.co.nz.

Batato is a German citizen who lives in Munich and was only in New Zealand to attend Dotcom’s 38th birthday party, according to his bail ruling. He has no criminal convictions and, like Dotcom and van der Kolk, denies any part of the alleged conspiracy.

Van der Kolk is a Netherlands citizen residing in New Zealand and is the lead programmer for Megaupload Ltd., according to his bail ruling. He also has no convictions.

Dotcom was denied bail as flight risk remained a “real and significant possibility.” He had access to 23 separate bank accounts in Hong Kong that held more than NZ$26 million ($21.3 million), according to his ruling. The FBI said his earnings for 2010 were $42 million and he had NZ$10 million in New Zealand government bonds.

When police arrived at Dotcom’s house on Jan. 20, he activated electronic locks and sought refuge in a safe room, New Zealand police said in a statement. Police neutralized locks and cut their way into the safe room, where Dotcom was sitting cross-legged on the floor near a safe that contained a loaded shotgun.

Dotcom’s unlawful possession of the gun “suggests a level of criminality which to my mind could easily extend to exploiting criminal connections to obtain false travel documents and leave the country undetected,” McNaughton wrote Jan. 25.

In the raid, police said they seized 18 luxury vehicles, including a Rolls Royce Phantom Drophead Coupe and a 1959 pink Cadillac. The vehicles are valued at NZ$6 million. The U.S. received restraining orders for assets valued at $175 million, including some in New Zealand.

The U.S. indicted Dotcom because some of Megaupload’s servers were based in that country. Other servers were based in Canada and the Netherlands, according to the ruling.

Megaupload was advertised as having more than 1 billion visitors, more than 150 million users, 50 million daily visitors, and accounted for 4 percent of Internet traffic, U.S. prosecutors said. New Zealand prosecutors must show Dotcom is accused of an offense that would be punishable by at least 12 months in jail in both the U.S. and New Zealand, according to the 1999 Extradition Act.

For copyright news, click here.

Trade Secrets/Industrial Espionage

NCSoft Sues Bluehole, claims ‘Tera’ Contains ‘Lineage’ Secrets

NCSoft Corp. (036570), a South Korean maker of computer games, sued a company founded by some of its former employees for trade- secret misappropriation.

The lawsuit, filed in federal court in Manhattan, accuses South Korea’s Bluehole Studio Inc. and its U.S.-based En Masse Entertainment unit of misappropriating software, hardware and artwork related to “Lineage 3,” a computer game.

NCSoft said it has already brought a civil action in South Korea against its ex-employees and that they were convicted in civil court of trade secret theft. That conviction is being appealed, according to court documents.

A new Bluehole game, “Tera,” bears a “striking resemblance” to NCSoft’s “Lineage 3,” the company said in court papers, claiming “it is evident” the new game contains purloined trade secrets Bluehole was barred from using.

NCSoft asked the court for an order barring release of “Tera” and for money damages and awards of litigation costs and attorney fees.

The company is represented by Gene W. Lee and Jeanne C. Curtis of Boston’s Ropes & Gray LLP.

The case is NCSoft Corp. v. Bluehole Studio Inc., 1:12- cv-00172-LAK, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Victoria Slind-Flor in San Francisco at vslindflor@bloomberg.net

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net

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