September 2014

The patent laws require that the claims of a patent (which define the boundaries of what the patent owner can protect) “particularly point out and distinctly claim the subject matter … of the invention.”  35 U.S.C. §112, ¶2.  This requirement is referred to as “definiteness.”  A patent that fails to satisfy this requirement may be found to be invalid for indefiniteness.

The purpose of the definiteness requirement is to provide the public with notice of what the patent owner owns, and what would be an infringement of the patent.  Thus, the definiteness requirement serves to encourage innovation by providing certainty as to what the patent protects.

This year, the United States Supreme Court vacated a Federal Circuit Court of Appeals decision on the grounds that the Federal Circuit’s test for indefiniteness was not precise enough and would result in confusion in the district courts.  The case is Nautilus, Inc. v. Biosig Instruments, Inc., 189 L.Ed. 2d 37 (June 2, 2014).

In 2004, the patent owner, Biosig, sued Nautilus for infringement of a patent covering a heart-rate monitor used in exercise.  Biosig’s heart monitor was different from existing heart monitors in that it was more accurate because it did not measure both electrical signals from the user’s heart and from the muscles.  The Biosig heart monitor used two pairs of electrodes, one pair for each hand of the user.  Biosig alleged that Nautilus, who owned the StairMaster brand of exercise machine, used the patented heart monitor in StairMaster machines.
Continue Reading Patents Must Provide Clear Notice of Their Scope

transparentIn the not so distant past, E & J Gallo Winery (“Gallo”) decided that it was not satisfied with only being a player in the wine business.  It decided to expand his horizons and venture into the tequila business, which is currently filled with such players as Patron, Don Julio, Jose Cuervo, and perhaps most importantly, 1800 Tequila (“1800”).  After placing a significant amount of time and effort into the release of its new tequila, Camarena, Gallo was informed that its supplier, Tequila Supremo, had received a cease and desist letter from Agavera Camichines S.A. de C.V. (“Agavera”), the holder of trademark and trade dress rights for the “1800 Tequila” brand.  Accordingly, Gallo brought suit for declaratory relief in the United States District Court in the Eastern District of California.

Agavera and co-defendant, Proximo Spirits Inc. (“Proximo”), counterclaimed that Gallo’s Camarena bottle design infringes Proximo’s registered trade dress and also constitutes false designation of origin under the Lanham Act and unfair competition under common law.  Gallo sought and prevailed on its motion for summary judgment before the Honorable Judge Lawrence J. O’Neill of the Eastern District of California.  Judge O’Neill found that Proximo failed to raise a genuine issue as to whether its trade dress was distinctive.  Furthermore, it was found that there was no likelihood of confusion between 1800 Tequila and Camarena.  Proximo moved for reconsideration on grounds that its trademark registration and related description of the 1800 Tequila bottle and stopper should have constituted sufficient evidence for a trier-of-fact to rely on in deeming the bottle distinctive.  Nonetheless, Judge O’Neill denied the request.  The court also denied Proximo’s motion to dismiss the declaratory judgment action on grounds that the court lacked subject matter jurisdiction.  As a result, Proximo appealed the decision to the Ninth Circuit to challenge the court’s ruling on the motion to dismiss and its grant of summary judgment on the counterclaims.  
Continue Reading Gallo Whines Its Way Into the Tequila Business

Victims of trade secret theft often can seek a variety of civil and criminal remedies against those who have absconded with proprietary information.  The Ninth Circuit however recently rejected criminal charges in a situation where the claims could be addressed as a civil matter under California’s trade secret laws.

In United States v. Nosal, David Nosal was sued by his former employer, the Korn/Ferry executive search and placement firm.  After leaving Korn/Ferry, Mr. Nosal contacted several former colleagues who were still working with the company and asked them for assistance with his efforts to set up a competing business.  Mr. Nosal’s former co-workers had access to a significant amount of proprietary information on the Korn/Ferry computer system, and assisted Mr. Nosal by using this access in order to provide names, contact information, and other confidential data from Korn/Ferry’s proprietary database to Mr. Nosal.  Although their access to the database was authorized, the employees provided information to Mr. Nosal in violation of a trade secret and nondisclosure agreement with their employer.
Continue Reading Ninth Circuit Limits Application of the Computer Fraud and Abuse Act