June 5 (Bloomberg) -- President Barack Obama announced a series of actions aimed at protecting technology, finance and retail companies from lawsuits and demands for fees by businesses that abuse the patent system.
The crackdown on what critics have called “patent trolls” includes five executive actions and seven recommendations that require congressional action. A White House commission report said more than 100,000 companies were threatened with infringement last year by patent-assertion entities -- companies whose sole business is to obtain patents and use them to obtain royalties from businesses that make or use products and services.
The announcement formalizes changes that have been considered by the U.S. Patent and Trademark Office, including making patent owners and applicants identify who benefits financially from the patent and improving application examinations. It also backs some legislation sponsored by members of both parties in Congress.
Abusive patent lawsuits are a growing drain on companies and the court system, though not all businesses that own patents without making products are “trolls,” according to a report released yesterday by the White House Council of Economic Advisers, the National Economic Council and the Office of Science and Technology Policy.
Key provisions seek to help businesses receiving letters demanding royalties for the use of products, such as scanning documents so they can be sent via e-mail, providing Wi-Fi services to customers and tracking customer shipments. The National Retail Federation has reported a number of lawsuits designed to get companies to either pay the patent owner or spend large amounts of money in litigation.
The patent office plans to educate retailers and end users of technology about their rights. Among the legislative proposals are ones that would provide better legal protection against liability for users of common products, make royalty demand letters public and give courts more discretion to sanction those who file abusive suits.
With many of the lawsuits being over software, the president directed the patent office to monitor applications more closely to ensure they don’t claim a broad use of technology. One proposal backed by the White House also would expand a new review program for finance-related business methods to also include computer-implemented technology.
“When responsible actors increasingly find themselves at the mercy of those abusing the patent system, decisive steps must be taken to protect small business innovation,” said Morgan Reed, executive director of the Association for Competitive Technology, a lobbying group for application developers.
Sage Electrochromics’ Patent Suit Sent Out for Mediation
Sage Electrochromics Inc.’s patent lawsuit against Milpitas, California-based View Inc. was referred for mediation, according to a May 29 court filing.
Sage, based in Faribault, Minnesota, sued in federal court in San Francisco in December claiming its patents 5,724,177 and 7,372,610 were infringed. The two patents are related to electrochromic devices and methods.
Both companies are glass manufacturers. The disputed technology involves the use of electric charges to alter the optical qualities of glass.
The deadline for completing mediation is Oct. 15, according to the case docket. The court previously set a hearing on the reach of the patents for January.
The case is Sage Electronics v. View Inc., 12-cv-06441, U.S. District Court, Northern District of California (San Francisco).
Apple Faces U.S. Import Ban on Some Devices After Samsung Win
Apple Inc. faces a ban on imports of some devices including the iPhone 4 and iPhone 3G made for AT&T Inc. after a U.S. trade agency said they infringe a patent owned by Samsung Electronics Co., its biggest competitor in the global market for smartphones.
Samsung’s patent 7,706,348, was issued in April 2010. It covers an information-transmitting apparatus and method used in a communications system that meets the International Mobile Telecommunications-2000 standards, also known as the 3G standards.
The U.S. International Trade Commission announced its decision in a notice posted on its website. The import ban is subject to review by President Barack Obama, who can overturn the decision on public-policy grounds.
The commission found that Apple didn’t violate three other Samsung patents.
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Louboutin Sues Charles Jourdan Over Red-Sole Shoe Trademark
Christian Louboutin Sarl sued Charles Jourdan Fashion Footwear LLC claiming it infringed a trademark for red-soled women’s shoes.
Jourdan supplied and shipped counterfeit shoes to retailers in New York, Louboutin said in a filing yesterday in federal court in Manhattan.
“Defendants were and are aware that the counterfeit products they sell are not genuine Louboutin products,” Paris-based Louboutin said in its complaint.
The U.S. Court of Appeals in Manhattan ruled in September that Louboutin has the right to trademark protection for women’s shoes with red soles when the remainder of the shoe has a different color. The decision came in a case brought against Yves Saint Laurent America Inc.
Louboutin said in the complaint that the counterfeit shoes were sold on the website of DSW, or Designer Shoe Warehouse, and at stores in Manhattan and Brooklyn. It seeks $2 million in damages for each mark that is infringed.
The case is Christian Louboutin SAS v. Charles Jourdan Fashion Footwear LLC, 13-cv-3776, U.S. District Court, Southern District of New York (Manhattan).
Kansas Coffee Shop Told Name Infringed Twisted Sister Trademarks
A coffee shop in Mission, Kansas, received a cease-and-desist letter from legal counsel representing a founder of the 1980s heavy-metal band Twisted Sister, according to the KCTV News website.
Twisted Sisters coffee shop was named after its two owners, who are sisters and were called “twisted sisters” in the 1960s, KCTS reported.
In the letter, the Twisted Sister band is described as world famous, a claim disputed by some of the coffee shop’s customers, according to the news website.
Tilaknagar to Produce Brandy Under Two Mohan Brewery Brands
Tilaknagar Industries Ltd., a liquor company based in Mumbai, signed a 25-year agreement with Mohan Brewery & Distilleries Ltd. to make and sell Mohan’s two brands, India’s Economic Times reported.
The two brands are Brigadier’s No. 1 brandy and Vorion No. 1 brandy, the newspaper reported.
Tilaknagar will use Mohan’s manufacturing and bottling facilities to produce the products, according to the Economic Times.
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Fox Broadcasting on Appeal Seeks to Stop Dish’s AutoHop ‘Threat’
News Corp.’s Fox Broadcasting Co. is asking a federal appeals court to overrule a district judge and halt Dish Network Corp.’s AutoHop ad-skipping service that it says threatens television’s advertising system.
Lawyers for Fox claim Dish’s PrimeTime Anytime and AutoHop services, which allow subscribers to record all four networks’ entire primetime schedule and watch the shows commercial-free the next day, infringe Fox’s copyrights and breach Dish’s license agreement with Fox.
Fox alleges the AutoHop service threatens the ad-supported television model because it diminishes the value of commercials, which are the main source of financing for primetime programming. The ABC, CBS, NBC and Fox affiliate associations, as well as the National Association of Broadcasters, filed arguments in support of Fox’s appeal.
Fox, Comcast Corp.’s NBCUniversal and CBS Corp. separately sued Dish, the No. 2 U.S. satellite-television provider, in May 2012, claiming the service will destroy the “advertising supported ecosystem” that provides free, over-the-air primetime television. Dish sued the networks in New York, seeking a court ruling that it isn’t infringing copyrights.
Dish, based in Englewood, Colorado, introduced its Hopper digital video recorder in March of last year. It can record all the major networks’ primetime shows and store them for eight days after their initial broadcast. AutoHop, introduced in May 2012, allows viewers, with the touch of a button, to skip all the commercials on recorded shows automatically.
The case is Fox Broadcasting Co. v. Dish Network LLC, 12-57048, U.S. Court of Appeals for the Ninth District (Pasadena, California).
Lawyers Who Chased Pirates Involved in Piracy, Defendant Claims
A defendant in a copyright case alleging unauthorized downloading of an adult film through the BitTorrent file-sharing protocol filed an affidavit accusing lawyers involved with these cases of piracy themselves.
In his June 3 filing in federal court in Orlando, Florida, Paul Oppold said that some of the lawyers were simultaneously acting as pirates by distributing the film through BitTorrent and “pirate catcher” by recording the Internet protocol addresses of those who downloaded the film. This was done for the “monetization of infringement” and was “both evil and ingenious” according to the affidavit.
One of the lawyers he named, John Steele of Prenda Law, didn’t respond immediately to an e-mailed request for comment. Although Steele isn’t listed as counsel in the case, Oppold claim Prenda Law is the actual manager of the litigation.
The underlying case was dismissed in December upon the request of the plaintiffs. Oppold is seeking attorney fees. Courts around the nation have dismissed many of these cases.
The case is First Time Videos LLC v. Oppold, 12-cv-01493, U.S. District Court, Central District of Florida (Orlando).
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