Bloomberg News

ADA-ES, Goodyear, Vivid: Intellectual Property

September 06, 2011

(This is a daily report on global news about patents, trademarks, copyright and other intellectual property topics. Corrects ownership of Norit Americas Inc. in first item.)

Sept. 6 (Bloomberg) -- Norit Americas Inc. has accepted a $40.5 million settlement offer from Littleton, Colorado-based ADA-ES Inc., according to a company statement.

The settlement follows a decision by a three-person independent arbitration panel that found ADA and two former Norit employees had misappropriated trade secrets and violated a contract. Norit is owned by Doughty Hanson & Co. and Euroland Investments.

Norit filed a trade secrets case in Texas state court in August 2008. In that suit, Norit, one of the world’s largest manufacturers of activated-carbon products used to control pollution, says ADA-ES persuaded John Rectenwald and Stephen D. Young to violate the confidentiality agreements they signed, and to reveal such proprietary information as the best locations to build activated-carbon production plants.

Both Young and Rectenwald had signed agreements with Norit requiring them to keep the company’s proprietary information in confidence for 10 years, Norit said. Both were “deeply involved in the invention and implementation of Norit’s proprietary production techniques, production facilities and products and had access to Norit’s trade secrets,” according to court papers.

Norit asked the court to order ADA-ES to quit using the proprietary information it acquired through Rectenwald and Young, and to bar the company from pursuing patents on that technology. It also sought a ban on the sale of products derived from its trade secrets.

In addition to the cash settlement, ADA and other defendants are required to maintain the confidentiality of Norit’s trade secrets, and to pay royalties on all activated carbon sales for the next eight years that uses those secrets.

The case is Norit Americas Inc. v. ADA-ES Inc, 08-0673, District Court of Harrison County, Texas.

Two Ex-Wkyo Engineers Sentenced for Goodyear Trade Secret Theft

Two former engineers with the U.S. unit of Wyko Tire Technology Ltd., convicted of stealing trade secrets from Goodyear Tire & Rubber Co. for a Chinese tire company, were sentenced to probation by a federal court in Tennessee.

Clark A. Roberts and Sean E. Howley were convicted in December of trade-secret theft charges, including unlawful photography and transmission of trade secrets, conspiracy and wire fraud. The two engineers took cell phone photos in a Goodyear plant while servicing Wyko equipment there and transmitted them to a Wyko facility in the U.K., according to a statement from the U.S. attorney in Knoxville, Tennessee.

The photos were used to construct tire-building equipment for a Chinese manufacturer of off-the-road tires, according to the U.S. attorney’s statement. They faced potential 10-year prison sentences for the trade-secret convictions and 20 years for wire fraud, plus $2.5 million in fines.

The two received their sentences Aug. 25. They each received four years’ probation, 150 hours of community service and a $1,000 fine, according to court documents.

The case is U.S. v. Roberts, 3:08-cr-00175, U.S. District Court, Eastern District of Tennessee (Knoxville).

Copyright

Unnamed Buyer Seeks Copyright to Kardashian Sex Tape, TMZ Says

Vivid Entertainment, a producer of adult films, said an anonymous buyer has offered what the Los Angeles company calls “big bucks” for the copyright to a sex tape allegedly made by celebrity Kim Kardashian, the TMZ.com gossip website reported.

A lawyer acting for the potential buyer told Vivid the aim of the purchase is the complete removal of the film from the market, according to TMZ.com.

The potential buyer has also offered to purchase any raw unused footage featuring Kardashian that didn’t make it into the finished tape, TMZ reported.

Swede Gets Two-Year Prison Sentence for Copyright Infringement

A 60-year-old Swedish man was sentenced to two years in prison for copyright infringement in that country, according to a blog posting by Pirate Party founder Rick Falkvinge.

Falkvinge, whose political party promotes reform of copyright laws, said in his blog posting that the alleged infringer had shared 2,880 tracks of music through the DirectConnect hub.

He noted that the sentence was conditional, and said that in Sweden this is often the equivalent of probation.

Falkvinge listed what he said were typical sentences for other offenses in Sweden, including six months for severe negligent homicide; one year and four months for a rape conviction; 10 months for sexual abuse of a child; and armed robbery with a firearm, one year and nine months.

When the law under which the alleged infringer received his sentence was enacted two years ago, Falkvinge said Swedish politicians who approved the measure were “acting like drunken blindfolded elephants trumpeting about in an egg-packaging facility.”

Indian Railroad Told to Halt Music Over License Non-Payment

The Calcutta Metro Railway was ordered by the Calcutta High Court to quit playing music in its stations without a license and to pay license fees, the Times of India reported.

Phonographic Performance Ltd. of India, a music-licensing agency, told the court that although Metro’s most recent music license expired in November 2005, music videos performed on television screens in the station needed to be licensed, according to the Times.

The railroad argued that it had told station managers to halt playing music and that the what was presented on television programming didn’t infringe the copyrights, the newspaper reported.

Officials from the railway told the Times it hadn’t yet received the court order.

Police Officer Suspended for Downloading Movie to Squad Car

A police officer in Madison, Wisconsin, received a six-day suspension following the discovery he’d infected his squad car’s laptop computer by trying to download the “Hall Pass” film without authorization, the Wisconsin State Journal reported.

After the computer was infected, the police officer tried to remove the virus himself instead of taking it to technical- support staff, according to the newspapers.

The suspension came for violating department policies relating to on-duty business and the care of city-owned property, as well as guidelines on appropriate computer use, the newspaper reported.

His name wasn’t released to the public under department policy regarding police discipline for administrative violations, according to the Wisconsin State Journal.

For more copyright news, click here.

Trademark

Purple Heart Order Sues Kansas Charity for Infringing Marks

The Military Order of the Purple Heart, an organization of veterans who have received the Purple Heart decoration after being wounded in combat, sued a Kansas charity for trademark infringement.

The group’s complaint, filed Aug. 26 in federal court in Kansas City, Kansas, accuses the Purple Heart Veterans Foundation of Tonganoxie, Kansas, of using its trademarks without authorization.

The order claims the foundation used a website -- www.purpleheart-donations.org -- to advertise and solicit money.

As the result of a domain name dispute between the two entities, the foundation agreed to transfer the name to the order, according to court papers. Even after the transfer, the order claims the foundation continues its acts of infringement.

The foundation is accused of using the Purple Heart marks to solicit money outside Wal-Mart Stores Inc.’s stores and other retailers. The Springfield, Virginia-based order says it has received none of the money collected by the foundation, and that potential donors are confused and deceived by the foundation’s actions.

It asked the court to bar the foundation’s use of the order’s trademarks, for an award of all money the defendant collected through its unauthorized use of the trademarks, and for awards of money damages and litigation costs.

Alleging the infringement is deliberate, the order asked that the damages be tripled to punish the defendant.

The foundation operates a website at carepkgs4veterans.org. According to the website, the foundation has raised $50,000 since January 2010, “to assist hospitalized veterans.”

Andrew Gruber, president of the foundation, said in an e- mail that the charity is “geared toward helping veterans” and that “bad press” is forcing his organization to shut down.

The order is represented by Timothy R. West and Jennifer B. Wieland of Berkowitz Oliver Williams Shaw & Eisenbrand LLP of Kansas City, Missouri, and David R. Cross and Johanna M. Wilbert of Milwaukee’s Quarles & Brady LLP.

The case is Military Order of the Purple Heart v. Purple Heart Veterans Foundation, 2:11-cv-02485-EFM-JPO, U.S. District Court, District of Kansas (Kansas City).

For more trademark news, click here.

Patents

Medibotics Gets Motion-Recognition Clothing-Technology Patent

Medibotics LLC received a patent for a technology enabling clothing to recognize motion that can be used for game sensors, virtual exercise, sports training and medical therapy.

Patent 7,980,141 covers a wearable position or motion- sensing system. The system includes sensors that include a flexible element containing a flowable substance such as a gel, gas or liquid, according to the patent.

As the substance moves, it conveys that information to a transducer that converts it into an output signal that can indicate the degree of bending, twisting or elongation of the sensing element. From this, the body-part position or movement can be derived.

The technology is portable and can be used with a mobile transmitter for any activity including swimming, the Minneapolis-based company said in an Aug. 31 statement. It doesn’t require users to remain in front of a stationary camera, and can be employed by multiple users at once.

Clothing that uses this technology can be washable, the company says.

Medibotics applied for this patent in April 2009 with the assistance of Schwegman Lundberg & Woessner PA of Minneapolis. The patent was issued July 19.

DuPont Sues Heraeus Over Patent for Solar-Cell Technology

DuPont Co., the largest U.S. chemical company by market value, sued Germany’s Heraeus Holding GmbH, alleging infringement of a U.S. patent for material used in building solar cells.

Heraeus, of Hanau, Germany, owes DuPont damages for using the technology, which includes an electroconductive paste of silver, glass and resin, lawyers said in a complaint filed Sept. 2 in federal court in Wilmington, Delaware. In dispute is patent 7,767,254, which was issued in August 2010.

The infringement “will continue to cause DuPont irreparable injury and damage” unless stopped by the court, according to court papers. The Wilmington-based company also seeks a jury trial.

“DuPont invests significant resources and millions of dollars in research,” David B. Miller, president of DuPont Electronics & Communications, said in a statement. “We will continue to take appropriate actions to protect our patent estate.”

“We do not have any information on this case at the moment,” Martina Rauch, a Heraeus spokeswoman, said in an e- mailed statement. “No lawsuit has been officially served.”

The case is DuPont v. Heraeus Holding, 11CV773, U.S. District Court, District of Delaware (Wilmington).

For more patent news, click here.

--Editors: Glenn Holdcraft, Fred Strasser

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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