Bloomberg News

Nokia-Apple, Abbott, 3M, News Corp.: Intellectual Property

June 15, 2011

(This is a daily report on global news about patents, trademarks, copyright and other intellectual property topics. Updates with ConAgra item in Trademark section.)

June 15 (Bloomberg) -- Nokia Oyj won an almost two-year patent dispute with Apple Inc., as the world’s largest mobile- phone makers reached a settlement that awards a one-time payment and royalties to the Finnish handset maker.

The agreement will bolster the Devices & Services unit’s second-quarter profitability, Espoo, Finland-based Nokia said in a statement yesterday. The details of the contract, under which Apple will pay Nokia an undisclosed sum and royalties for the term of the agreement, are confidential, the Finnish company said.

The two mobile-phone makers have been in litigation since October 2009, when Nokia filed a lawsuit accusing Cupertino, California-based Apple of infringing patents. The Finnish company also demanded royalties on the millions of iPhones sold since the device’s introduction in 2007. Nokia said in March it has 46 patents asserted against Apple in civil lawsuits and complaints lodged with the U.S. International Trade Commission.

“Nokia emerges as a clear winner from the fight,” Sami Sarkamies, analyst at Nordea Bank AB in Helsinki, said in a note to clients yesterday. The initial payment will likely be in the range of hundreds of millions of euros related to about 200 million Apple devices delivered to date, Sarkamies said. Nokia stock had lost more than three quarters of its value since Apple introduced the iPhone in June 2007.

“This frees up resources for both Apple and Nokia,” said Florian Mueller, a Munich-based consultant and an opponent of software patents. “Other companies whom Nokia will ask to pay royalties will have to think very hard whether to pay or pick a fight.”

Nokia Chief Executive Officer Stephen Elop is readying a line of phones based on Microsoft Corp.’s Windows Phone 7 operating system to replace the company’s own Symbian line, which is losing market share to Apple’s iPhone and Android handsets based on Google Inc.’s Android system.

“We’re glad to put this behind us and get back to focusing on our respective businesses,” said Apple spokesman Steve Dowling.

In a statement yesterday, the Cupertino, California-based company said that that Nokia will have a license to some technology, “but not the majority of the innovations that make the iPhone unique.” Apple gets a license to some of Nokia’s patents, including ones that were deemed essential to industry standards on mobile phones.

As is the general practice in technology industries, the royalty amount won’t be disclosed

Nokia’s first claims covered technology for wireless data, speech coding, security and encryption. Subsequent claims asserted rights to wiping gestures on a touchscreen and on- device application stores, both of which Nokia said it filed to patent more than 10 years before the iPhone launch.

The Finnish company also broadened its claims to cover Apple’s iPad and iPod Touch.

Abbott Overturning of $1.67 Billion J&J Verdict to Stand

Abbott Laboratories’ victory in overturning a $1.67 billion patent-infringement verdict won by Johnson & Johnson will stand, a U.S. appeals court said yesterday.

The U.S. Court of Appeals for the Federal Circuit in Washington denied a petition to reconsider a Feb. 23 decision that threw out the biggest patent-related damages award in U.S. history, according to a notice on the court website. J&J had claimed Abbott’s Humira arthritis drug infringed its patent, and the appeals court said the patent was invalid.

The case is Centocor Inc. v. Abbott Laboratories, 10-1144, U.S. Court of Appeals for the Federal Circuit (Washington). The lower court case is Centocor Inc. v. Abbott Laboratories, 07cv139, U.S. District Court, Eastern District of Texas (Marshall).

For more patent news, click here.

Trademark

3M Sues Gambling Websites, Domain-Name Owners for Infringement

3M Co., the maker of Scotch tape and Post-it Notes, filed a trademark-infringement lawsuit against 13 domain name registrants, eight website-hosting service providers and 46 Internet domain names.

According to the complaint filed June 10 in federal court in Alexandria, Virginia, the defendant registrants operate online gambling websites. They own the websites that are also named as defendants, 3M said in court papers.

The registration services 3M sued are accused of providing Internet hosting services to the registrant defendants. The website domain names to which 3M objects all carry either “3M” or “MMM” as an element in the name.

3M says the unauthorized use of its trademarks can confuse and deceive the public into believing wrongly that there is some connection between those sites and the St. Paul, Minnesota-based company. 3M said the use of its marks in those domain names tarnish its trademarks, and unjustly enriches the alleged infringers.

The company asked the court to bar unauthorized use of its marks by the defendants, and to order that it be transferred all the allegedly infringing names. Additionally, 3M seeks awards of attorney fees, litigation costs and money damages and asked that the damages be tripled to punish the defendants for their actions.

3M also requested an award of the defendants’ profits attributable to the alleged infringement.

The company is represented by Timothy J. McEvoy and Sean Patrick Roche of Cameron McEvoy PLLC of Alexandria and William G. Barber and Wendy C. Larson of PirkeyBarber LLP of Austin, Texas.

The case is 3M Co. v. Name.com, 11-cv-00627, U.S. District Court, Eastern District of Virginia (Alexandria).

ConAgra Buys Marie Callender’s Trademarks for $57.5 Million

ConAgra Foods Inc., the maker of Banquet frozen dinners, Slim Jims and Orville Redenbacher popcorn, acquired the trademarks of Marie Callender Pie Shops Inc. for $57.5 million.

ConAgra will no longer pay license fees to Mission Viejo, California-based Marie Callender, the Omaha, Nebraska-based company said in a statement. ConAgra in 2004 acquired a license to sell Marie Callender’s frozen dinners and pot pies. Last year, ConAgra acquired the Marie Callender’s license for frozen dessert pies from American Pie LLC.

The 63-year-old Marie Callender chain, with outlets in seven western states, will receive a license to continue using the name for its bakery and restaurant operations, according to the statement.

Carp, Beans, Apricots Win EU Protected Name and Origin

The European Union extended protected name and geographical indications to three more agricultural commodities.

The three newly protected items are beans from a specific area of Italy, carp from a region of Poland and a specific variety of Hungarian apricots.

The Fagiolo Cuneo is a dried bean with a high iron content grown in Italy’s province of Cuneo. The bean has a thin skin, and is dried off the plant.

Poland’s Karp Zatorski is an olive green fish found in the “Valley of the Carp” in western Poland. The Gonci kajszibarack is an apricot often used to make brandy.

For more trademark news, click here. For copyright news, click here.

Trade Secrets/Industrial Espionage

Woodchuck Cidery Claims Ex-Employee Stole Hard-Cider Recipes

Woodchuck Cidery, a maker of hard cider, sued a former employee for allegedly stealing trade secrets, the WCAX.com news website reported.

The Middlebury, Vermont-based company claimed the ex- employee stole recipes and left to begin a competing hard-cider company, according to WCAX.com.

Woodchuck seeks a court order requiring the former employee to release personal files on his own computer, WCAX.com reported. The company also claimed the former employee copied ingredients and nutrition facts directly from its label, according to the website.

Ex-News Corp. Employee Beats Trade-Secrets Claim on Verb Tense

A former employee of a News Corp. unit, whose testimony against his ex-employer played a key part in antitrust litigation, defeated a trade-secrets case because of an error in verb tense in his employment contract.

Robert T. Emmel was accused of making improper disclosures of News Corp.’s News America Marketing In-Store unit. He was a former account director for retailers who was fired in 2006.

Emmel allegedly brought confidential information to a number of state and federal offices, including the New York Attorney General’s Office, the U.S. Securities and Exchange Commission and the U.S. Senate Finance Committee.

News America agreed in February to pay $125 million to settle a suit from Insignia Systems Inc. accusing the company of anti-competitive behavior. It earlier agreed to pay $500 million to Valassis Communications Inc. on similar claims, and $49.5 million to settle a claim from Floorgraphics Inc.

In the suit filed in April 2007 in federal court in Atlanta, Emmel was accused of “the devious and unauthorized retention” of computer data and hard-copy documents. News America said he gave this information to a competitor and indicated he would supply it to others.

Emmel responded by telling the court that he was convinced his ex-employer “was engaged in widespread illegal activity against its customers, competitors and shareholders” and that News America management refused to do anything about it. He described the information he took as evidence of News America’s “extensive billing and revenue-sharing fraud against its customers,” and “predatory and anti-competitive schemes against competitors.”

The data also proved that News America engaged in “fraudulent inflation of its reported earnings,” he said.

When Emmel left News America in December 2006, he signed an agreement not to disclose his employer’s confidential data or to disparage the company. That agreement was signed on Dec. 21.

The day before he signed the agreement, he sent a package of News America’s confidential documents to a staffer for the U.S. Senate’s Finance Committee. He said later in a deposition that his goal “was to make sure the information got out before I would be signing an agreement.”

The court issued an order in May 2009 barring further disclosures of the confidential information. Emmel then appealed.

The 11th U.S. Circuit Court of Appeals looked at the language of the agreement and said that because all the promises Emmel made when he signed the contract were in future tense, they wouldn’t apply to his actions before the signing date.

“The specific promises undertaken were couched in language that applies only prospectively,” the court said in its June 8 ruling. “The simple past tense” could have been used in the contract to capture Emmel’s pre-contract actions, the court said.

The lower court case is News America Marketing In-Store LLC, 1:07-cv-00791-TCB, U.S. District Court, Northern District of Georgia (Atlanta). The appeal is News America Marketing v. Robert T. Emmel, 11th U.S. Circuit Court of Appeals (Atlanta).

--With assistance from Diana ben-Aaron in Helsinki, Susan Decker in Washington and Linda Sandler, Sarah Rabil and Bob Van Voris in New York. Editors: Glenn Holdcraft, Stephen Farr

To contact the reporter on this story: Victoria Slind-Flor in Oakland, California, at vslindflor@bloomberg.net.

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


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