Mondelez International Inc. (MDLZ:US), the world’s second-biggest coffee maker, will start selling Nespresso-compatible capsules across Europe this fall, posing the sternest competitive challenge yet to the Nestle SA (NESN) brand.
Mondelez, based in Deerfield, Illinois, will sell the knock-off capsules under its Jacobs and Carte Noire brands in Germany, France, Austria and Switzerland in the second half of 2013, Roland Weening, vice president of strategy, marketing and innovation, said in an interview in London June 10.
The move brings a deep-pocketed entrant to the fastest-growing part of the $80 billion global coffee market at a time when Nespresso’s growth has slowed. Nestle, of Vevey, Switzerland, has filed patent-infringement lawsuits against some rivals that introduced capsules compatible with Nespresso machines, yet to date has not been able to stem the flow of copycat capsules from producers including D.E Master Blenders 1753. (DE) That comes as Nestle has said sales growth this year may be at the low end of its long-term target.
Mondelez wants a bigger slice of the $8 billion single-serve segment, which accounts for 20 percent of the European coffee market, up from 6 percent in 2006, Weening said. Spun off from Kraft Foods (KRFT:US) last year, Mondelez has sold its own single-serve beverage machine, Tassimo, since 2005. Weening said the move into Nespresso-compatible capsules would not “de-prioritize” Tassimo, which has sales approaching $1 billion.
Nestle, the maker of Nescafe and Dolce Gusto, dominates the European single-serve market with a share of 70 percent, according to Andreas Von Arx, an analyst at Helvea AG. Nespresso cultivates an exclusive image for the brand through ads featuring actor George Clooney, and boutiques that boast tasting salons in locations such as Paris’s Champs-Elysees.
That approach has made Nespresso one of Nestle’s fastest-growing and most profitable brands. In 2010, Nespresso accounted for about 15 percent of Nestle’s growth, Nomura analyst David Hayes has estimated. This year, the brand may account for about a 10th of the 5.12 billion-franc ($5.44 billion) increase in sales expected by analysts.
Nestle’s legal actions, which include lawsuits filed in several European countries, have so far not stopped rivals from selling compatible capsules. The most recent ruling came in April when a Nestle unit lost a patent infringement lawsuit that sought to block Dualit, a U.K. company, from making capsules for Nespresso machines.
WARF, Professional Groups Raise Concerns About Fee Sequester
The Wisconsin Alumni Research Foundation, the technology-licensing arm of the University of Wisconsin, has joined with a number of professional organizations in asking the U.S. Congress to halt the diversion of fees paid by patent applicants.
Their May 28 letter to congressional leaders said that $1 billion in user fees has been diverted from their “proper use” at the U.S. Patent and Trademark Office during the past 20 years. This fee diversion violates the America Invents Act, which set up a reserve fund to ensure that fees paid to the patent office would remain at the patent office, according to the letter.
Letter signatories say they’ve learned that the office of Management and Budget has overridden this legislation by sequestering 5 percent of the fees.
In addition to WARF, others who signed on to the letter include the Advanced Medical Technology Association, the California Healthcare Institute, the Innovation Alliance, the International Federation of Professional and Technical Engineers, CONNECT, the Medical Device Manufacturers Association, National Treasury Employees Union, National Venture Capital Association and Patent Office Professional Association.
Rambus Says SK Hynix Licensing Accord Ends Patent Litigation
Rambus Inc. (RMBS:US) said it settled its patent litigation with SK Hynix Inc. (000660) and signed a license agreement for the South Korean memory-chip maker to use its technology.
“This is a milestone agreement for both companies that puts years of legal disputes behind us and gives us the opportunity for collaboration,” Rambus Chief Executive Officer Ron Black said yesterday in a statement.
The five-year agreement with SK Hynix will bring in $12 million a quarter, according to the statement.
A federal judge in San Jose, California, last month ordered Rambus to pay $250 million to SK Hynix for destroying documents in their litigation. Rambus, based in Sunnyvale, California, won a $349 million judgment on its patent-infringement claims in 2006.
Representatives of SK Hynix didn’t immediately respond before regular business hours in Seoul to an e-mail seeking comment on a licensing accord.
Rambus’s cases against SK Hynix, and another related case against Micron Technology Inc. (MU:US), are over the companies’ use of interfaces that are part of dynamic random access memory that acts as the main memory in computers. DRAM is built to industry standards and is interchangeable by product.
The case is Hynix Semiconductor Inc. v. Rambus Inc., 00-cv-20905, U.S. District Court, Northern District of California (San Jose).
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NFL Chief Argues Against Changing Name of Redskins Football Team
National Football League Commissioner Roger Goodell sent a letter to the U.S. House of Representatives Native American Caucus June 5 explaining why the name of the Washington Redskins team shouldn’t be changed.
The team franchise began as the Boston Braves in 1932, and the name was changed to Redskins in 1933 to avoid confusion with the baseball team of the same name and to honor the coach, William “Lone Star” Dietz, according to Goodell.
Although Dietz claimed he had a Native American heritage, that has been disputed, according to Indian Country Today, a Native American publication.
Goodell said in his letter that the Redskins name has “from its origin represented a positive meaning distinct from any disparagement that could be viewed in some other context.”
He argues that this positive meaning “is shared by the overwhelming majority of football fans and Americans generally, including Native Americans.” The Annenberg Public Policy Center found that only 10 percent of the Native Americans surveyed found the name to be objectionable, he said.
Included with his letter were written interviews with Inuit Chief Steven Dodson and Robert Green, chief of the Patawomeck Tribe of Virginia, who said they didn’t find the name to be objectionable.
Meanwhile, a measure was introduced in the U.S. Congress that would amend the Trademark Act of 1946 to bar registration of terms that disparage Native American people. That bill --H.R. 1278 -- which has been referred to the House Committee on the Judiciary, specifically lists “redskin” as a term that is offensive.
According to the patent office database, requests for the cancellation of the Redskins marks are pending.
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Marvel Must Defend ‘Ghost Rider’ Copyright, Court Says
Walt Disney Co. (DIS:US)’s Marvel Entertainment must go to trial to defend against a copyright claim by Gary Friedrich, who claims he created the comic book character “Ghost Rider,” a motorcycle-riding superhero with a flaming skull.
Friedrich claims he first came up with the idea for Ghost Rider in 1968, then assigned his rights to Marvel, which published the first “Ghost Rider” comic book in 1972. Friedrich claims in his suit that the rights to Ghost Rider automatically became his after the initial copyright term expired in 2000.
Marvell argued that Friedrich assigned his renewal rights to it in a work-for-hire agreement he signed in 1978. The U.S. Court of Appeals in Manhattan today reversed a lower-court ruling in favor of Marvel, granting Friedrich a trial on his claim.
“The agreement is ambiguous and there are genuine disputes of material fact regarding the parties’ intent to assign renewal rights in that agreement, the timeliness of Friedrich’s ownership claim, and the authorship of the work,” U.S. Circuit Judge Denny Chin wrote on behalf of a three-judge panel.
In the suit, Friedrich seeks an unspecified share of the money made by Marvel on “Ghost Rider.”
In 2007, Sony Corp. (6758)’s Columbia Pictures Industries released a film version of “Ghost Rider,” starring Nicholas Cage and Eva Mendes. The film took in $228.7 million in worldwide ticket sales, according to Box Office Mojo. A 2012 sequel, “Ghost Rider: Spirit of Vengeance,” made $132.6 million.
Jeff Klein, a Marvel spokesman with Dan Klores Communications, didn’t immediately respond to a voice-mail message seeking comment on the ruling.
The case is Gary Friedrich Enterprises LLC v. Marvel Characters Inc., 12-00893, U.S. Court of Appeals for the Second Circuit (Manhattan).
RiksTV Prevails Over Norwegian Rights Group in Copyright Fight
RiksTV AS, an Oslo-based provider of television services, prevailed in a copyright dispute with Norwaco, a Norwegian rights and royalty collection organization, Broadband TV News reported.
Norwaco had claimed that RiksTV was acting as a relay and was seeking payment from its television channels, according to Broadband TV News.
If it hadn’t prevailed, RiksTV would have been liable for multiples of 1 million Norwegian kroner ($173,000), Broadband TV News reported.
Norwaco was ordered to pay 2.68 million kroner in litigation costs, the publication reported.
Mississippi AG Wants Google to Address IP Rights Issues
Mississippi’s attorney general invited Google Inc. (GOOG:US) officials to the national meeting of the National Association of Attorneys General to address intellectual property issues, AdWeek reported.
Jim Hood of Mississippi said Google’s search engine gives too easy access to infringing content, counterfeit goods and dangerous drugs, AdWeek reported.
He said that the search engine company blocks access to child pornography and sites that glorify the Nazi party and asked why Google doesn’t do the same for websites that provide pirated content or sell prescription drugs without prescriptions, according to the publication.
Google responded in a statement saying it has taken down more than 3 million illegal pharmacies and, in its transparency report, that it responded to 16 million takedown requests related to copyright issues, AdWeek reported.
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