The patent claims of this multi-claim lawsuit surrounding 3-D metal printing were bifurcated, and a jury trial on the patent claims was held in late July. The jury returned a verdict finding the two asserted patents valid but not infringed. The remaining trade secret, breach of contract, and unfair competition claims will be tried at a later date.
Judge Young denied without prejudice a pair of motions to seal. He noted that the Protective Order entered in the case governs only inter-party disclosures, and cannot provide the basis for filing a document under seal with the court. This case, which involves claims of misappropriation of trade secrets relating to metal 3D printing in connection with the hiring of a former Desktop Metal employee as well as patent infringement claims, was filed in March of 2018, with a motion for preliminary injunction, based on the asserted patents, filed shortly thereafter. In keeping with his typical approach, Judge Young collapsed the motion with an early trial, which he scheduled for July. Markforged then filed counterclaims alleging that Desktop Metal’s founders themselves took Markforged trade secrets with them when they started the company. Desktop Metal sought to bifurcate and try only the patent claims in the July trial, or to allow an expedited hearing on its motion for preliminary injunction, citing the “morass” of additional factual and legal elements from the counterclaims that would make the targeted July trial date unworkable. The motion was denied without prejudice, as was a motion to continue the trial to later in July. A series of motions to dismiss were denied (although Judge Young did note that many of the affirmative defenses seemed to be mere boilerplate, “interposed for the purpose of delay”), meaning a complex litigation involving patents, trade secrets, contractual and other state law claims may well run only four months. One should always be aware that, when appearing before Judge Young, there is a strong chance of a quick trial if preliminary relief is sought.
Protecting Intellectual Property in the Post-AIA World
Over the past few years, trade secrets have gained stature as a means to protect intellectual property in America. With the continuing pressure on patent protection, the ever-increasing ease of copying and misappropriating information, and the creation of new trade secret laws in the United States, the importance of understanding and successfully implementing trade secret protection has never been more important. On Thursday, February 15 at 11:00 EST, I will be presenting a webinar discussing recent developments in trade secret law and the steps that should be taken to ensure your secrets remain protected. Topics that will be discussed include:
• The overlap between trade secret protection and patent protection
• Best practices for protecting information from misappropriation
• Successfully licensing trade secret information
• Trends in the application of the Defend Trade Secrets Act that created a federal cause of action for trade secret misappropriation
I would love to have you join – please click here to register.
Judge Talwani granted The Atomic Café’s motion or a preliminary injunction, enjoining the use of its ATOMIC CAFÉ ROASTERS marks and requiring the return of its equipment; she deferred ruling on the requested injunction relating to trade secrets.
Asigra hired Atlantis to develop and provide software to Asigra, a project that was initially expected to take about a year. After agreeing to the terms for this work, Asigra sought to accelerate the completion of the project. Asigra indicated that it could only do so by incorporating code from Atlantis’ own appliance product. The parties orally agreed to Asigra receiving a limited right to use this code, with the parties disputing the consideration due Atlantis for this right. After completion of the project, when a dispute arose over payment, Atlantis “unilaterally revoked the nonexclusive license” and sued Asigra for breach of contract, trade secret misappropriation, and copyright infringement, among other things. Asigra moved for judgment on the pleadings on all counts. Judge Hennessy granted Asigra’s motion with respect to the copyright claims, while denying it with respect to the other claims. He determined that Atlantis had granted a nonexclusive license to the code by the parties’ oral agreement, which became irrevocable upon the payment of consideration by Asigra. The reasoning is that, upon payment of consideration (regardless of whether it was complete consideration under the agreement) a contract has been formed, and the remedy for the aggrieved party is through contract law, not copyright.
Also of interest, Judge Hennessy determined that Asigra waived its argument that the allegedly misappropriated trade secrets were not adequately identified by raising it only in a footnote; First Circuit case law holds that arguments raised perfunctorily or solely by footnote are waived. He also denied judgment on the pleadings with respect to Asigra’s Ch. 93A claim, finding that one party’s breach of contract for the purpose of gaining leverage over the non-breaching party has been deemed an unfair business practice in Massachusetts.
Hardware giant True Value Company (“TVC”) sued TrueValue POS (“TV POS”) for federal and common law trademark infringement, dilution and unfair competition. TVC is a member-owned cooperative made up of 4500 independently-owned and operated retail stores, thousands of which are known as TRUE VALUE stores. TVC has registered TRUE VALUE for a variety of goods and services, including certain retail store services, indicia of membership in an association of retail hardware stores, provision of advertising services, wholesale purchasing services, and credit card services. They have been using the TRUE VALUE mark since 1954, and assert that the mark is famous. TVC asserts that TV POS began using the mark in 2013 or 2014 in its domain name (www.truevaluepos.com) in connection with Point Of Sale software and systems for restaurant, retail and credit card services. TVC seeks injunctive, monetary damages and attorneys’ fees, as well as a finding that the case is exceptional pursuant to 15 U.S.C. § 1117, which allows for statutory and treble damages.
John Mahoney and the Atomic Café accuse Kyle and Peter Roy and their companies Cold Brew Ventures, LLC, and Lean & Local, LLC, of trademark infringement, trade secret misappropriation, breach of contract, and various other state law claims. The complaint alleges that the defendants, who operate under the names LeanBox (which delivers vending machines and provides vending services) and Grind (which provides coffee products that are offered through LeanBox’s vending services), induced Mahoney to enter into a joint venture to produce and market his cold brew products on a larger scale. The joint venture, Cold Brew Ventures, designed and configured a production facility largely at Mahoney’s direction. The group agreed to the terms by which Mahoney would provide expertise to the venture – he was to receive a 25% equity stake in the facility and a fixed salary; yet once the facility became operational and his trade secret information had become known to them, the defendants refused to sign and unilaterally withdrew from the agreement. The defendants are accused of using two registered trademarks covering ATOMIC COFFEE ROASTERS, which Mahoney had used in his three retail shops and a manufacturing facility that makes cold brew coffee, latte, and tea. They are also accused of misappropriating proprietary information relating to Mahoney’s cold brew formulas and processes, as well as business information and contacts.
Algorithms for Success, Inc. (“AFS”) yesterday sued former employee Michael Fritz for breach of contract, breach of duty of loyalty, misappropriation of legally protected information, violation of M.G.L. 93A, inevitable disclosure, breach of the Computer Fraud and Abuse Act and the Defend Trade Secrets Act, and unfair competition. AFS is a business and career coaching and event management company for whom Fritz was a vice president with access to AFS’ customers and confidential information. Fritz signed non-compete, non-solicitation, non-disclosure and assignment agreements with AFS. AFS’ allegations are that a forensic analysis of Fritz’s work computer revealed that he accessed thousands of confidential records and attached external storage devices such as thumb drives and external hard drives to the computer in the days immediately before his last day of work. AFS seeks the return of its confidential and proprietary information, forensic access to Fritz’s personal computers and other devices, temporary, preliminary and permanent injunctions preventing further use or dissemination of AFS’ confidential and proprietary information and preventing Fritz from working for any employer who performs services for AFS customers with whom he worked or had access to confidential information, and compensatory and punitive dames and attorneys’ fees.