Pernod Ricard, Kodak, Apple, Novartis: Intellectual Property

Pernod Ricard SA (RI), which sells Havana Club rum in every country except the U.S., was dealt a blow in efforts to sell the liquor in the American market after the U.S. Supreme Court decided not to intervene in a clash over rights to the name.

The justices yesterday left intact a U.S. government agency’s rejection of a bid by Cuba’s state-owned Cubaexport to renew its U.S. trademark on the Havana Club name.

Pernod has an agreement with Cubaexport dating to 1993 under which it can sell Havana Club in countries other than in the U.S., where it is prevented from doing so by an embargo on goods produced in Cuba. Bacardi Ltd. has sold a Puerto Rican- made rum under the Havana Club name in Florida since 2006.

Pernod and Bacardi, based in Hamilton, Bermuda, have been fighting since 1994, when Bacardi applied for a U.S. trademark for its rum. Paris-based Pernod, which has been trying to position itself to sell rum in the U.S. under the Havana Club name should the American embargo on Cuban goods be lifted, said yesterday in an e-mailed statement that it would instead start selling a new rum, Havanista, in the U.S. if the ban is revoked.

Havanista is “specifically aimed at the U.S. market” and will “benefit from the same high-level production processes and quality requirements as the Havana Club range,” Pernod said.

The U.S. Treasury Department’s Office of Foreign Assets Control refused to renew Cubaexport’s trademark, relying on a 1998 law making trademarks confiscated by the Cuban government unenforceable. A federal appeals court in Washington upheld the decision. The law has been applied only to the Havana Club mark.

A different federal appeals court ruled against Pernod on a separate issue in August. It said consumers wouldn’t be confused into thinking Bacardi’s Havana Club rum was made in Cuba because the label says it is made in Puerto Rico.

Pernod said yesterday it won’t pursue further appeals against the ruling, which has cost “several million dollars.”

The Supreme Court case is Empresa Cubana v. Department of the Treasury, 11-945, U.S. Supreme Court (Washington).

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Copyright

Georgia State Cleared of Most Publisher Infringement Claims

A judge cleared Georgia State University of most copyright violation claims brought by publishers including Oxford University Press over using unlicensed book excerpts in course materials.

U.S. District Judge Orinda Evans held the university liable for five copyright-infringement claims, after conducting a non- jury trial last year, according to a filing dated May 11 in Atlanta federal court.

The publishers, who also included Cambridge University Press and Sage Publications Inc., sued in April 2008, They listed 99 alleged infringements, in which professors made portions of works available electronically to students. The university claimed fair use, which under copyright law means that small excerpts can be used for purposes such as teaching or journalism without violation. Georgia State changed its policy in 2009 to insure that professors adhered to fair use guidelines.

The Association of American Publishers said in a statement yesterday that the judge’s “analysis of fair use principles was legally incorrect in some places and its application of those principles mistaken.” The AAP praised some aspects of the ruling. “The court held GSU’s new policy accountable for specific infringements,” the AAP said.

Also sued were the university’s board of regents and its president, Mark Becker.

“The court’s ruling is significant not only for Georgia State University, but for all educational fair use in general,” Becker said in a statement. “Georgia State is pleased to have been a trailblazer in this increasingly complex digital copyright environment.”

The case is Cambridge University Press v. Becker, 08-01425, U.S. District Court, Northern District of Georgia (Atlanta).

Korean Memorial Sculptor Underpaid for Stamp Image, Court Rules

The U.S. Postal Service should pay more than $5,000 to the sculptor of marching soldiers at the Korean War Veterans Memorial in Washington for an image captured on a 37-cent stamp, an appeals court ruled yesterday.

Frank Gaylord, who designed the stainless-steel models known as The Column, had won a copyright-infringement case against the postal service for its use of the sculptures on a stamp issued in 2002 marking the 50th anniversary of the armistice. The service had paid $1,500 for rights to a photograph of the soldiers covered in snow.

Gaylord appealed again after he was awarded $5,000 for the use of his copyright. The appeals court said yesterday the amount didn’t consider how much Gaylord would have demanded in negotiations before the image was used without his permission.

The sculptor sought a 10 percent royalty on about $30.2 million worth of stamps, saying that’s consistent with his other licensing agreements. Instead, a judge with the U.S. Court of Federal Claims awarded $5,000 based on the highest amount the postal service said it had paid for an existing image.

The U.S. Court of Appeals for the Federal Circuit said yesterday that the lower court should consider the outcome of a hypothetical negotiation over total sales, including to collectors and commercial merchandise.

Gaylord was initially paid $775,000 for his work designing the soldiers and supervising the steel casting.

The postal service said last week that it lost $3.2 billion in the quarter ended March 31 and will temporarily run out of cash in October.

The case is Gaylord v. U.S., 2009-5044, U.S. Court of Appeals for the Federal Circuit (Washington).

For more copyright news, click here.

Patent

Court Lets Apple Pursue U.S. Ban on Samsung Galaxy Tablet

Apple Inc. (AAPL), the maker of the iPhone and iPad, can pursue efforts to halt sales of Samsung Electronics Co.’s Galaxy Tab 10.1 tablet computer in the U.S. while a patent-infringement case is pending, a U.S. appeals court ruled.

Apple’s patent on a design of the tablet is likely to withstand validity challenges, so the trial judge should consider if it’s in the public interest to block sales until a trial can be held, the U.S. Court of Appeals for the Federal Circuit ruled yesterday. The court upheld the trial judge’s rejection of a pretrial ban on Samsung products, including its phones, based on three other Apple patents.

The Samsung dispute is the biggest front in Apple’s efforts to curtail growth of phones that run on Google Inc.’s Android operating system, the most popular platform for mobile devices. The Cupertino, California-based smartphone maker contends Samsung has copied the look and feel of the iPhone and iPad to lure away customers.

The case ruled on yesterday is one of more than 30 filed in 10 countries between Suwon, South Korea-based Samsung and Apple. Samsung was forced to delay the release of some Galaxy devices or alter the product in Germany, the Netherlands and Australia because of the legal battle.

Apple and Samsung vie for the title of world’s largest maker of smartphones. Apple had 23.9 percent of the global market in the fourth quarter, while Samsung was No. 2 with 23.5 percent, according to data from Boston-based researcher Strategy Analytics.

The case is Apple Inc. v. Samsung Electronics Co. (005930), 12-1105, U.S. Court of Appeals for the Federal Circuit (Washington). The lower court case is Apple Inc. v. Samsung Electronics Co., 11-1846, U.S. District Court, District of California (San Jose).

For more, click here.

Novartis Sues Lupin, Torrent Over Blood-Pressure Medicine

Novartis AG (NOVN) sued Lupin Ltd. and Torrent Pharmaceuticals Ltd. (TRP) for infringing patents on its Exforge HCT blood-pressure medicine.

Lupin, based in Mumbai, and Torrent, based in Ahmedabad, India, are seeking to make generic versions of the drug before the expiration of two patents. Novartis requested a court order barring the companies from making, using or offering for sale copies of the drugs until the patents have expired, according to complaints filed yesterday in federal court in Wilmington, Delaware.

Novartis, based in Basel, Switzerland, is counting on new products, including Exforge, to help replace revenue lost when the company’s best sellers, Diovan for hypertension and Gleevac for leukemia, start to lose U.S. patent protection later this year and in 2015, respectively. The two Exforge patents in dispute expire in 2017 and 2023, according to U.S. Food and Drug Administration records.

Dawn Chitty, vice president of regulatory affairs at Torrent’s U.S. offices in Kalamazoo, Michigan, said the company doesn’t comment on pending litigation. Edith St-Hilaire, a spokeswoman for Lupin, didn’t immediately return phone and e- mail messages seeking comment on the lawsuit.

The cases are Novartis Pharmaceuticals Corp. v. Lupin Ltd. (LPC), 12-00595; Novartis Pharmaceuticals Corp. v. Torrent Pharmaceuticals, 12-00596, U.S. District Court, District of Delaware (Wilmington).

Nvidia, Intellectual Ventures Jointly Buy IPWireless Patents

Nvidia Corp. (NVDA), a maker of graphics processors, has teamed up with Intellectual Ventures to jointly acquire about 500 patents from IPWireless.

The portfolio covers patents for technology known as long- term evolution, or LTE, as well as for 3G and 4G networks, Santa Clara, California-based Nvidia and Intellectual Ventures, based in Bellevue, Washington, said in a statement yesterday. Terms weren’t disclosed.

Nvidia is trying to branch out into microprocessors for phones, lessening its reliance on personal computers. The company gets most of its revenue from chips used to create high- end graphics in desktop and notebook computers. Nvidia’s Tegra processor for mobile devices is designed to compete with products from Qualcomm Inc. (QCOM) and Texas Instruments Inc. (TXN)

Ownership of the patents was split between Nvidia and Intellectual Ventures, with Nvidia licensing rights to the patents it didn’t acquire. IPWireless retains royalty-free access to the patents.

Kodak Seeks Expressions of Interest in Its Patents by Today

Eastman Kodak Co. (EKDKQ), the photography pioneer that filed for bankruptcy in January, is seeking expressions of interest in its digital-imaging patents by today, the first step in an auction of the technology.

At this stage, Kodak is only determining who may want to bid on the portfolios, rather than taking formal offers, the Rochester, New York-based company said.

The ultimate price may hinge on the outcome of Kodak’s case with the U.S. International Trade Commission, which is deciding whether Apple Inc. and Research In Motion Ltd. (RIM) violated patents covering image previews on cameras. Judge Thomas Pender is due to give his ruling by May 21. A decision against Apple and RIM may lead the companies to license or buy Kodak’s technology.

Chris Veronda, a spokesman for Kodak, declined to comment, as did Apple’s Steve Dowling and RIM’s Heidi Davidson.

Kodak is offloading the digital-imaging patents as part of a plan to shrink the company and focus on printing rather than photography. It has until June 30 to file the patent-bidding procedures, which typically name the bidder preferred by the seller, also known as the stalking-horse. Once the stalking- horse offer is made public, other potential buyers can submit competing bids.

Kodak is selling two portfolios of patents: one related to digital capture, known as DC, and another covering the Kodak imaging systems and services, known as KISS.

Together, the technology is valued at between $2.21 billion and $2.57 billion, based on an estimate by 284 Partners LLC, a patent advisory firm hired by Kodak and cited in a debtor’s motion it filed before a U.S. bankruptcy court in January.

For more patent news, click here.

Speeches

Hacking Focus to Grow as U.S. Prosecutor Urges Disclosure

Companies need to be quicker to disclose they have been victims of cyber-crimes, Manhattan U.S. Attorney Preet Bharara said, telling defense lawyers the government will focus “more and more” on prosecuting such offenses.

Speaking yesterday at a conference at the Association of the Bar of the City of New York, Bharara said law enforcement is hampered when companies delay revealing they are victims of computer crimes, as many “routinely” do.

The U.S. announced in March that it had charged six leaders of an underground hacking movement that targeted the Central Intelligence Agency and Sony Pictures Entertainment Inc. Yesterday in Manhattan federal court, accused hacker Jeremy Hammond pleaded not guilty to charges of stealing client information from Austin, Texas-based intelligence firm Stratfor.

In his remarks to the bar association, Bharara urged defense lawyers and the companies they represent to play a “more central role” in fighting computer crime, whether it’s by hackers, corporate insiders or foreign groups or nations.

To contact the reporter on this story: Ellen Rosen in New York at erosen14@bloomberg.net

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

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