Monday, August 25, 2014

Where To Litigate "Disposable Living-Grass Pet Toilets?"

Fresh Patch, LLC owns U.S. Patent 8,522,719 directed to a pet toilet continuous delivery and replacement method.  Fresh Patch ("Real Dogs Use REAL Grass") offers a subscription service where they send you a patch of grass each week for your pet to use as a toilet.  DoggieLawn ("Your Dog's Backyard In A Box") offers a competing service.  Fresh Patch sued DoggieLawn and its owner for patent infringement.  DoggieLawn moved to transfer the case from the Middle District of Florida to DoggieLawn's home in the Central District of California.  The Court addressed the typical 1404 factors:

Section 1404 factors include (1) the convenience of the witnesses; (2) the location of relevant documents and the relative ease of access to sources of proof; (3) the convenience of the parties; (4) the locus of operative facts; (5) the availability of process to compel the attendance of unwilling witnesses; (6) the relative means of the parties; (7) a forum's familiarity with the governing law; (8) the weight accorded a plaintiff's choice of forum; and (9) trial efficiency and the interests of justice, based on the totality of the circumstances.
quoting Manuel v. Convergys Corp., 430 F.3d 1132, 1135 n.1 (11th Cir. 2005).   

Concerning witness convenience, both parties identified non-party witnesses.  Plaintiff's non-party witnesses, however, were not in Florida, so keeping the dispute in Florida was of no great benefit.  Defendant identified witnesses from a number of competitors (Pooch Potty, PetaPotty, and Porch Potty), and each of those witnesses were in California.  [Ed. Note: Who knew the subscription pet toilet service industry had so many players?]

The Court next noted that the Defendant was a small startup, while Plaintiff's revenues were in excess of $1m.  The Court also appeared persuaded (to a small degree) by the fact that Plaintiff's law firm also had an office in California.  [Ed. Note: Is this really relevant?]

Generally, a plaintiff's choice of forum will be given deference.  But here, the Court appears to have not believed Plaintiff's claim that the Middle District of Florida was its home forum.  For instance, Plaintiff could not identify any employees or offices in the Middle District and did not quantify any of its business here.

Motion to transfer, granted.
Fresh Patch, LLC v. Youn, Case No. 8:13-CV-2602 (M.D. Fla. July 25, 2014) (J. Merryday)

Monday, August 18, 2014

Different Standards For Deciding Whether To Stay?

You may recall that Judge Covington denied a defendant's request to stay litigation, rejecting that defendant's argument that it was merely a "peripheral" defendant since it had only bought the accused product from another defendant.  While the Court noted in that decision that cases are generally stayed against peripheral defendants, that general rule does not apply where the peripheral defendant and the plaintiff are competitors.  In denying the peripheral defendant's request for stay, the Court required that defendant to put forward "an undue hardship or inequity."  Because that defendant couldn't, a stay was not appropriate.

The other defendants in that case separately moved to stay the litigation in favor of the inter partes reviews of the three patents-in-suit those defendants had instituted.  Here, for the primary defendant who had instituted inter partes reviews, the standard for granting a stay is different, relying on a "liberal policy" in favor of granting them:

“Courts have inherent power to manage their dockets and stay proceedings, including the authority to order a stay pending conclusion of a PTO” proceeding.  Ethicon, Inc. v. Quigg, 849 F.2d 1422, 1426-27 (Fed. Cir. 1988). The party moving for a stay bears the burden of demonstrating that a stay is appropriate. See Landis v. N. Am. Co., 299 U.S. 248, 255 (1936). As acknowledged in Automatic Manufacturing Systems, Inc. v. Primera Technology, Inc., No. 6:12-cv-1727-RBD-DAB, 2013 WL 1969247, at *1 (M.D. Fla. May 13, 2013), “In patent cases, a number of courts reason that such stays should be liberally granted when there is a pending administrative proceeding pending before the USPTO.” (citing Sabert Corp. v. Waldington N. Am., No. 06-5423, 2007 WL 2705157, at *5 (D.N.J. Sept. 14, 2007)(highlighting the “liberal policy in favor of granting motions to stay proceedings” because review by the USPTO “might assist the court in making a validity determination or [] eliminate the need to make an infringement determination.”); WABCO Holdings, Inc. v. Bendix Commercial Vehicle Sys., LLC, No. 09-3179, 2010 WL 2628335, at *2 n.2 (D.N.J. June 28, 2010)(“the liberal policy towards stays . . . arises due to the potential waste in using a court’s time and energy when a USPTO decision could drastically alter the nature of the case.”))
The Court then addressed the typical factors: (1) whether the stay would unduly prejudice or present a clear tactical disadvantage to the non-moving party; (2) whether the stay will simplify the issues in question and trial of the case; and (3) whether a stay will reduce the burden of litigation on the participants or the court.   Here, the Court appeared persuaded in part because of the "highly technical component" of the case.  Importantly, while the Court previously rejected the peripheral defendant's request to stay because the peripheral defendant was a competitor, that same logic did not carry the day here:
The Andersons, Inc. also opposes the requested stay on the grounds that it is in direct competition with Defendants, and any stay of the proceedings will allow Defendants to continue their allegedly infringing activities unabated.  Defendants correctly counter that The Andersons, Inc. has not sought a preliminary injunction and that any damages The Andersons, Inc. incurs may be remedied with money damages.  See Tomco Equip. Co. v. SE Agri-Sys., Inc., 542 F. Supp. 2d 1303, 1308 (N.D. Ga. 2008)(rejecting the argument that plaintiff's damages "will intensify during a stay" because "the availability of money damages is sufficient to protect plaintiff from prejudice.").
Motion for stay, granted.  Case administratively closed and parties obligated to file a status report every 90 days.

The Andersons, Inc. v. Enviro Granulation, LLC., Case No. 8:13-CV-3004 (M.D. Fla. Aug. 14, 2014) (J. Covington)

Wednesday, August 6, 2014

Who Do You Sue For Copyright Infringement, Father or Son?

When last we checked in with Malibu Media (owner of a library of adult films and associated copyrights), Malibu had filed suit against John Doe and then used the Court's subpoena power to take an IP address which identified an alleged infringer's network connection and force the ISP to identify which subscriber belonged to that IP address.  (The Electronic Frontier Foundation has written about Malibu Media here.)

In another case, a little further down the enforcement timeline, Malibu Media had received from the ISP the subscriber's identity.  But instead of suing the subscriber, Malibu Media sued the subscriber's son:
The ISP, Bright House Networks Online Service, identified [Father] as the internet subscriber...Upon investigation, Plaintiff learned that [Father] lives with his son...
At the time this case was originally filled, Plaintiff knew only that the infringer was using the internet subscriber's IP address.  Usually, the subscriber is the infringer.  But, as is the case here, sometimes the infringer is another person residing with the the subscriber, who the subscriber has authorized to use the subscriber's internet.
Time timespan of infringing activity precludes the possibility that the infringer was a short term guest or other interloper.
Plaintiff's Amended Complaint [Dkt. 8] at 5.  Malibu then goes on to explain that it found other video files downloaded by the IP address (for tv shows like Breaking Bad, Lost, Weeds, and Futurama) and that the Son had "liked" these tv shows on Facebook.  Thus:
...[Son] is the most likely person to have used BitTorrent in the house from where the infringement emanated.  Consequently, Defendant is the most likely person to have infringed Plaintiff's copyrighted works through the use of BitTorrent.
Plaintiff's Amended Complaint [Dkt. 8] at 6-7.

So, after being served, [Son] sought dismissal, explaining that [Son] did not reside in the home during the time of alleged infringement and attacked Malibu's infringement evidence as stemming from an unlicensed investigator on a contingency pay arrangement.

[Son] also explained a decision by Judge Ungaro in the Southern District that [Son] described as a "game changer" for thwarting Malibu's activities:
Plaintiff has not shown how this geolocation software can establish the identity of the Defendant.  There is nothing that links the IP address location to the identity of the person actually downloading and viewing Plaintiff's videos, and establishing whether that person lives in this district..... 
Even if this IP address is located within a residence, the geolocation software cannot identify who has access to that residence's computer and who would actually be using it to infringe Plaintiff's copyright.
Malibu Media v. Doe, Case No. 1:14-CV-20213 (S.D. Fla. Mar. 5, 2014) (J. Ungaro).

Returning to the present case, Judge Moody was not persuaded by the Southern District's reasoning:
While it may be true that the IP subscriber, or the son of an IP subscriber as it is in this instance, is not undoubtedly the infringing individual, the Plaintiff's burden at this stage is only to demonstrate plausibility.  See [Ashcroft v.] Iqbal, 556 U.S. 662, 678-79 (2009); cf., Malibu Media LLC v. John Does 1-16, 902 F. Supp. 2d 690, 698 (E.D. Pa. 2012) ("The Court acknowledges, however, that the information provided by the ISPs in response to the subpoenas will not necessarily reveal the identities of the actual infringers, but may, with other discovery, lead to the infringer's identities.")  To that end, Plaintiff has alleged a plausible link between the subscriber assigned to [the IP address], Defendant, and the copyright infringement, and any factual disputes are inappropriate at this stage.
As to the charge that the investigator's technique's were inappropriate, the Court found those allegations premature.

Motion to dismiss, denied.
Malibu Media, LLC v. [Son], 8:13-cv-3007 (M.D. Fla. Aug. 1, 2014) (J. Moody)