Justia U.S. 7th Circuit Court of Appeals Opinion SummariesArticles Posted in Patents
Life Spine, Inc. v. Aegis Spine, Inc.
Life Spine makes and sells a spinal implant device called the ProLift Expandable Spacer System. Aegis contracted with Life Spine to distribute the ProLift to hospitals and surgeons. Aegis promised to protect Life Spine’s confidential information, act as a fiduciary for Life Spine’s property, and refrain from reverse-engineering the ProLift. Aegis nonetheless funneled information about the ProLift to its parent company, L&K Biomed to help L&K develop a competing spinal implant device. Shortly after L&K’s competing product hit the market, Life Spine sued Aegis for trade secret misappropriation and breach of the distribution agreement. The district court granted Life Spine a preliminary injunction barring Aegis and its business partners from marketing the competing product. Aegis argues that the injunction rested on a flawed legal conclusion—that a company can have trade secret protection in a device that it publicly discloses through patents, displays, and sales.The Seventh Circuit affirmed. While public domain information cannot be a trade secret, a limited disclosure does not destroy all trade secret protection. Life Spine did not publicly disclose the specific information that it seeks to protect by patenting, displaying, and selling the ProLift. Life Spine’s trade secrets are not in the public domain but are accessible only to third parties who sign confidentiality agreements. View "Life Spine, Inc. v. Aegis Spine, Inc." on Justia Law
ABS Global, Inc. v. Inguran, LLC
Until recently, Sexing Tech held a monopoly on the market for sexed cattle semen in the United States. Sperm‐sorting technology separates bull semen into X‐chromosome bearing and Y‐chromosome bearing sperm cells; the resulting “sexed semen” is used to inseminate cows artificially so that dairy farmers can breed only milk‐producing cows. ABS, a bull‐stud operation, sued, alleging that Sexing Tech had unlawfully monopolized the domestic sexed‐semen market in violation of section 2 of the Sherman Act by using its market power to impose coercive contract terms. ABS sought a declaratory judgment proclaiming those contracts invalid, to permit its own entry into that market. Sexing Tech counterclaimed that ABS infringed its patents and breached the contract by misappropriating trade secrets in developing ABS’s competing technology. Three claims went to trial: ABS’s antitrust claim and Sexing Tech’s patent infringement and breach of contract counterclaims. The Seventh Circuit affirmed the district court, holding that ABS violated a confidentiality agreement it had with Sexing Tech and that Sexing Tech’s patent was not invalid on obviousness grounds. The jury’s assessments of two of the three patent claims still at issue cannot be reconciled under the rules governing dependent claims and enablement, and so a new trial is necessary on them. View "ABS Global, Inc. v. Inguran, LLC" on Justia Law
Soarus L.L.C. v. Bolson Materials International Corp.
Bolson develops products and processes for use in 3D printing. Soarus is a distributor of specialty polymers, including G-Polymer. In 2009, Bolson and Soarus began discussing Bolson’s acquisition and use of GPolymer in connection with developing a new 3D printing process. Soarus sought to protect its rights in G-Polymer while also allowing for its potential entry into the lucrative 3D printing market. The parties executed a nondisclosure agreement (NDA). Soarus then provided Bolson with confidential information regarding G-Polymer and samples. Shortly after executing the NDA, Bolson filed a provisional patent for the 3D printing process it developed using G-Polymer; the 171 Patent issued in 2013. Soarus claimed that Bolson’s patent application revealed confidential information about G-Polymer, in violation of the NDA. The district court granted Bolson summary judgment, concluding that the plain meaning of the NDA, while conferring generally broad confidentiality protection on Bolson’s use of information about G-Polymer, authorized Bolson to use such confidential information in pursuing a patent in the specific area of the fused deposition method of 3D printing. The Seventh Circuit affirmed. The NDA clearly authorise Bolson to freely patent and protect new applications of GPolymer in the specified 3D printing process, not confined by the NDA’s confidentiality restrictions. View "Soarus L.L.C. v. Bolson Materials International Corp." on Justia Law
Grigoleit Co. v. Whirlpool Corp.
Whirlpool purchased injection-molded plastic knobs and decorative metal stampings from Grigoleit. In 1992 Whirlpool told Grigoleit that it would start using products made by Phillips. Grigoleit believed that Phillips was using a method protected by its patents. Ultimately Grigoleit licensed its patents to Whirlpool and Phillips; instead of royalties Grigoleit got Whirlpool’s business for the “Estate” and “Roper” brand lines and a promise of consideration for other business. The agreement and the patents expired in 2003. An arbitrator concluded that Whirlpool had failed to consider Grigoleit’s parts for some lines of washers and dryers and was liable for payment of money royalties or damages. Grigoleit demanded the profit it would have made had Whirlpool purchased its requirements of knobs exclusively from Grigoleit. The district court concluded that a reasonable royalty fell in the range of 1¢ to 12¢ per part and the parties then agreed that royalties would then be $140,000. The Seventh Circuit affirmed, reasoning that lost profits differ from royalties. The caption on the contract is “LICENSE AGREEMENT” and the heading on paragraph 3 is “Royalties.” The agreement is a patent license; the court was not obliged to treat it as a requirements contract.View "Grigoleit Co. v. Whirlpool Corp." on Justia Law
Affymax, Inc. v. Ortho-McNeil-Janssen Pharmaceuticals, Inc.
In 1992 two companies began a joint venture to develop peptide compounds. The agreement provides that inventions created by joint efforts are jointly owned, but inventions attributable to a single party are owned by that party and that disputes will be arbitrated. In court-ordered arbitration, a panel decided that a certain group of patents are jointly owned, but that another group is owned by defendant. The district court confirmed those rulings, but vacated a ruling in defendant's favor on foreign patents. Holding that appeal is authorized by 9 U.S.C. 16(a)(1)(E), and that the dispute does not concern patent law, but is a contract issue, the Seventh Circuit reversed. The Federal Arbitration Act authorizes a court to vacate an award for any of four reasons, 9 U.S.C. 10(a); a conclusion that the arbitrators disregarded the law by failing to discuss the foreign patents separately from the domestic patents did not justify vacating the award. The judge mistakenly inferred from silence that the arbitrators must have had an extra-contractual ground; the arbitrators had no reason to discuss the foreign patents separately from the domestic patents.
Georgia-Pacific Consumer Prods. v. Kimberly-Clark Corp.
Plaintiff claimed that several of defendant's brands of toilet paper infringed on its trademark design. The district court entered summary judgment, holding that toilet paper embossed patterns are functional and cannot be protected as a registered trademark under the Lanham Act, 15 U.S.C. 1115(b)(8). The Seventh Circuit affirmed. Plaintiff patented the design, claiming it to be functional and can only claim the protection of a patent, not that of a trademark. The "central advance" claimed in the utility patents is embossing a quilt-like diamond lattice filled with signature designs that improves perceived softness and bulk, and reduces nesting and ridging. This is the same essential feature claimed in the trademarks.