Justia Civil Procedure Opinion Summaries

The case involves Creative Games Studio LLC and Ricardo Bach Cater, who sued Daniel Alves for alleged breach of contract, breach of the implied covenant of good faith and fair dealing, constructive fraud, and deceit. The plaintiffs, who are co-founders of Creative Games Studio, a company that develops board games for online sale, accused Alves of collaborating with a competitor and using the company's funds and intellectual property for the competitor's benefit. Alves, a Brazilian citizen, was also a co-founder of the company. The plaintiffs filed the lawsuit in Montana, where the company is based.The District Court of the Thirteenth Judicial District, Yellowstone County, dismissed the case due to lack of personal jurisdiction over Alves. The court determined that exercising jurisdiction over Alves would not comply with constitutional requirements. Alves had moved to dismiss the complaint under M. R. Civ. P. 12(b)(2) for lack of personal jurisdiction or under the doctrine of forum non-conveniens.The Supreme Court of the State of Montana affirmed the lower court's decision. The court found that Alves did not consent to jurisdiction and that subjecting him to the jurisdiction of Montana courts would not comply with due process. The court noted that Alves' only connection to Montana was the fact that one of the plaintiffs resided there and established the company in the state. The court concluded that the plaintiffs failed to show that Alves either availed himself of the privileges of Montana law or that their claims arose out of Alves's actions in Montana. View "Creative Games v Alves" on Justia Law

This case involves Packet Intelligence LLC ("Packet") and NetScout Systems, Inc. and NetScout Systems Texas, LLC (collectively, "NetScout"). Packet had sued NetScout for patent infringement. The U.S. District Court for the Eastern District of Texas found that NetScout had willfully infringed Packet's patents and awarded Packet damages, enhanced damages for willful infringement, and an ongoing royalty. NetScout appealed this decision.In a previous appeal, the United States Court of Appeals for the Federal Circuit had reversed the district court's award of pre-suit damages and vacated the court's enhancement of that award. The court affirmed the district court's judgment in all other respects and remanded the case to the district court. On remand, the district court denied NetScout's motion to dismiss or stay the case and entered an amended final judgment. The amended judgment reduced the enhanced damages and reset the ongoing royalty rate.Meanwhile, the Patent Trial and Appeal Board ("Board") found all of the patent claims asserted by Packet in this case unpatentable as obvious. Packet appealed the Board's final written decisions. The Federal Circuit coordinated those appeals so they would be considered by the same panel deciding this appeal.The United States Court of Appeals for the Federal Circuit vacated the district court’s amended final judgment and remanded the case with instructions to dismiss the case as moot. The court held that Packet’s infringement judgment was not final before the Board’s unpatentability determinations were affirmed. Therefore, the court was compelled to order that Packet’s patent infringement claims be dismissed as moot. View "PACKET INTELLIGENCE LLC v. NETSCOUT SYSTEMS, INC. " on Justia Law

The case revolves around SnapRays, a Utah-based company that designs, markets, and sells electrical outlet covers with integrated guide lights, safety lights, motion sensor lights, and USB charging technology, and Lighting Defense Group (LDG), an Arizona-based company that owns a patent related to a cover for an electrical receptacle. LDG submitted an Amazon Patent Evaluation Express (APEX) Agreement alleging that certain SnapPower products sold on Amazon.com infringed its patent. SnapPower subsequently filed an action for declaratory judgment of noninfringement.The United States District Court for the District of Utah dismissed SnapPower's complaint for lack of personal jurisdiction over LDG. The court concluded that LDG lacked sufficient contacts with Utah for it to exercise specific personal jurisdiction. It found that LDG's allegations of infringement were directed toward Amazon in Washington, where the APEX Agreement was sent, and not at SnapPower in Utah. The court also noted that under Federal Circuit law, principles of fair play and substantial justice support a finding that LDG is not subject to specific personal jurisdiction in Utah.The United States Court of Appeals for the Federal Circuit reversed the lower court's decision. The appellate court concluded that LDG purposefully directed extra-judicial patent enforcement activities at SnapPower in Utah, thereby satisfying the requirements for specific personal jurisdiction. The court found that LDG's submission of the APEX Agreement to Amazon, which identified SnapPower's listings as allegedly infringing, was an intentional action aimed at affecting SnapPower's sales and activities in Utah. The court also rejected LDG's argument that the assertion of specific personal jurisdiction over it in Utah would be unfair and unreasonable. The case was remanded for further proceedings. View "SNAPRAYS v. LIGHTING DEFENSE GROUP " on Justia Law

The case revolves around a dispute between Jalmar Araujo and Framboise Holdings Inc. over the registration of the standard character mark #TODECACHO. Araujo filed a U.S. Trademark Application to register #TODECACHO for hair combs. Framboise opposed the registration, claiming that it would likely cause confusion with its #TODECACHO design mark, which it had been using in connection with various hair products since March 24, 2017. Framboise also had a pending trademark application for the same mark.The United States Patent and Trademark Office Trademark Trial and Appeal Board (the Board) granted Framboise an extension to submit its case in chief. Araujo opposed this extension and the late submission of a declaration by Adrian Extrakt, Director of Framboise. However, the Board granted the extension, finding that the delay was minimal and that Framboise had met the applicable good cause standard. The Board then relied on the Extrakt declaration to support Framboise's claim of prior use of the #TODECACHO design mark.The Board found that Framboise had met its burden to establish prior use by a preponderance of the evidence. It found that the Extrakt declaration alone was sufficient to prove prior use because it was clear, convincing, and uncontradicted. Having found an earlier priority date for Framboise, the Board found a likelihood of confusion between the two marks, sustained the opposition, and refused registration of Araujo’s mark.On appeal, the United States Court of Appeals for the Federal Circuit affirmed the Board's decision. The court found that the Board did not abuse its discretion in granting the extension and that the Board's finding that Framboise established prior use of the #TODECACHO design mark was supported by substantial evidence. View "ARAUJO v. FRAMBOISE HOLDINGS INC. " on Justia Law

The case involves a dispute between GeLab Cosmetics LLC, a New Jersey-based online nail polish retailer, and Zhuhai Aobo Cosmetics, a China-based nail polish manufacturer. The founders of GeLab, Xingwang Chen and Shijian Li, are both Chinese citizens. The dispute centers around the ownership of GeLab and allegations of trade secret theft. According to Chen, he and Li founded GeLab with Chen owning 60% and Li 40%. They entered a joint venture with Zhuhai, which was supposed to invest in GeLab for an 80% ownership stake. However, Chen alleges that Zhuhai never sent the money and instead began using low-quality materials for GeLab's products, selling knock-off versions under its own brand, and fraudulently claiming majority ownership of GeLab. Zhuhai, on the other hand, asserts that Chen was its employee and that it owns 80% of GeLab.The dispute first began in China, where Li sued Chen for embezzlement. Chen then sued Li, Zhuhai, and Zhuhai's owners in New Jersey state court, alleging that he had a 60% controlling interest in GeLab and that Zhuhai had no ownership interest. The state defendants counterclaimed, seeking a declaratory judgment that Zhuhai owns 80% of GeLab. GeLab then filed a second action in New Jersey against Li alone. The state court consolidated the two cases.While the New Jersey proceedings were ongoing, GeLab filed a federal lawsuit in the U.S. District Court for the Northern District of Illinois against Zhuhai and its owners, alleging violations of the federal Defend Trade Secrets Act and the Illinois Trade Secrets Act. The defendants responded that Zhuhai owns GeLab and that it cannot steal trade secrets from itself. The district court stayed the federal case, citing the doctrine of Colorado River Water Conservation District v. United States, reasoning that judicial economy favors waiting for the New Jersey court to determine who owns the company. GeLab appealed the stay.The United States Court of Appeals for the Seventh Circuit affirmed the district court's decision to stay the proceedings. The court found that the federal and state cases were parallel as they involved substantially the same parties litigating substantially the same issues. The court also found that exceptional circumstances warranted abstention, with at least seven factors supporting the district court's decision. These factors included the inconvenience of the federal forum, the desirability of avoiding piecemeal litigation, the order in which jurisdiction was obtained by the concurrent fora, the source of governing law, the adequacy of state-court action to protect the federal plaintiff's rights, the relative progress of state and federal proceedings, and the availability of concurrent jurisdiction. View "GeLab Cosmetics LLC v. Zhuhai Aobo Cosmetics Co., Ltd." on Justia Law

The case involves a long-standing trademark dispute between two charities, Kars 4 Kids, Inc. and America Can! Cars for Kids. Both organizations sell donated vehicles to fund children's education programs. In 2003, Texas-based America Can discovered a Kars 4 Kids advertisement in the Dallas Morning News and sent Kars 4 Kids a cease and desist letter, asserting America Can’s rights to the “Cars for Kids” mark in Texas. Kars 4 Kids, based in New Jersey, did not respond to the letter and continued to advertise in Texas.The case was first brought to the United States District Court for the District of New Jersey in 2014, where both parties alleged federal and state trademark infringement, unfair competition, and trademark dilution claims. A jury found that Kars 4 Kids infringed on America Can’s unregistered mark in Texas. The District Court awarded monetary and injunctive relief. However, the court's decision was appealed, and the case was remanded for the District Court to reexamine its conclusion that the doctrine of laches did not bar America Can’s claims.On remand, the District Court again concluded that laches did not bar relief. The court found that Kars 4 Kids’ advertising in Texas was not open and notorious enough to prompt America Can to act more quickly to protect its mark. The court also found that Kars 4 Kids was not prejudiced by America Can’s delay because Kars 4 Kids had assumed the risk of its advertising campaigns after receiving the 2003 cease and desist letter.The United States Court of Appeals for the Third Circuit disagreed with the District Court's findings. The appellate court held that the District Court abused its discretion by not properly applying the presumption in favor of laches. The court found that America Can failed to establish that its delay in bringing suit was excusable and that Kars 4 Kids was not prejudiced as a result of that delay. Therefore, the court vacated the District Court's judgment granting monetary and injunctive relief and remanded with instructions to dismiss America Can’s claims with prejudice based on laches. The court also dismissed as moot America Can’s cross-appeal. View "Kars 4 Kids Inc v. America Can Cars For Kids" on Justia Law

This case involves a dispute between two manufacturers of dining mats for toddlers, Luv n' Care, Ltd. and Nouri E. Hakim (collectively, “LNC”), and Lindsey Laurain and Eazy-PZ, LLC (collectively, “EZPZ”). LNC filed a lawsuit against EZPZ, seeking a declaratory judgment that EZPZ’s U.S. Patent No. 9,462,903 (the “’903 patent”) is invalid, unenforceable, and not infringed. EZPZ counterclaimed, alleging infringement of the ’903 patent, among other claims. After a bench trial, the district court found that LNC failed to prove that the ’903 patent is unenforceable due to inequitable conduct, but that EZPZ was barred from obtaining relief due to its “unclean hands.” The court also granted LNC’s motion for partial summary judgment that the claims of the ’903 patent are invalid as obvious. Both parties appealed.The United States Court of Appeals for the Federal Circuit affirmed the district court’s judgment on the doctrine of unclean hands, meaning that EZPZ was barred from obtaining relief due to its misconduct during the litigation. However, the court vacated the district court’s judgment on inequitable conduct and invalidity, finding that there were genuine disputes of material fact that precluded summary judgment. The court also vacated the district court’s denial of LNC’s motion for attorney fees and costs, and remanded the case for further proceedings. View "Luv n' Care, Ltd. v. Laurain" on Justia Law

Tracey Murray and the Estate of Robert Murray filed a lawsuit against Miracorp, Inc., NTTS, Inc., Lane Goebel, and Shane Goebel, alleging both legal and equitable claims based on conduct that took place before 2012. The Murrays claimed that they were shareholders in Miracorp and that the company and its officers had breached fiduciary duties, committed fraud, and unjustly enriched themselves at the Murrays' expense. The Murrays also alleged that Miracorp had converted their property and misappropriated trade secrets.The district court granted summary judgment in favor of Miracorp, ruling that the Murrays' claims were barred by the applicable statutes of limitations. The court found that the Murrays' injuries were reasonably ascertainable in 2011, and thus, the period for filing a lawsuit had expired. The Murrays appealed this decision.The Kansas Court of Appeals affirmed the district court's decision. The appellate court agreed that the Murrays' claims were time-barred because their injuries were reasonably ascertainable in 2011. The court held that the Murrays had waited too long to investigate and seek redress for their injuries.The Kansas Supreme Court affirmed the decisions of the lower courts. The court held that the Murrays had a duty to reasonably investigate their suspicions in 2011. The court found that the Murrays did nothing to investigate their suspicions until 2016, which was unreasonable. As a result, the court ruled that the Murrays' claims were barred by the statute of limitations. View "Murray v. Miracorp, Inc." on Justia Law

AI Visualize, Inc. accused Nuance Communications, Inc. and Mach7 Technologies, Inc. of patent infringement in the District of Delaware. The patents in question concerned the visualization of medical scans, with an emphasis on three-dimensional views via a low-bandwidth web portal. Nuance and Mach7 sought dismissal of the case on the grounds that the patents were directed to patent-ineligible subject matter under 35 U.S.C. § 101. The district court agreed, ruling that the patents were directed to an abstract idea and failed to provide an inventive step that transformed the abstract idea into patent-eligible subject matter. Consequently, AI Visualize’s case was dismissed.Prior to this, the district court had granted Nuance and Mach7's motion to dismiss AI Visualize's complaint for failing to state a claim. AI Visualize then filed an amended complaint, which Nuance and Mach7 again moved to dismiss. The district court found that the patents attempted to address prior art problems with transporting large volume visualization datasets over a standard internet connection. However, the court ruled that the focus of the claimed advance over the prior art was abstract, and AI Visualize’s arguments that the claims were directed to improvements in computer functionality were rejected.On appeal, the United States Court of Appeals for the Federal Circuit affirmed the district court’s decision. The appellate court agreed that the patents in question were directed to an abstract idea and did not offer an inventive step that transformed the idea into patent-eligible subject matter. Further, the court observed that AI Visualize's amended complaint failed to provide sufficient factual allegations to support that the claims involved unconventional technology or a concrete application of the abstract idea of virtual view "creation". Thus, the dismissal of AI Visualize’s case was affirmed. View "AI Visualize, Inc. v. Nuance Communications, Inc." on Justia Law

This case pertains to an alleged copyright infringement involving software code used in an industrial control system. The plaintiffs, RJ Control Consultants, Inc. and its sole shareholder, Paul Rogers, appealed the district court’s exclusion of their proposed expert and the granting of summary judgment to the defendants, Multiject, LLC; its sole owner, Jack Elder; and RSW Technologies, LLC. The U.S Court of Appeals for the Sixth Circuit held that the district court did not abuse its discretion in excluding the plaintiffs’ proposed expert or in granting summary judgment to the defendants. The plaintiffs had failed to properly disclose their expert as required and did not produce an expert report. Consequently, they could not offer expert evidence to rebut the defendants' evidence. Furthermore, they could not create a genuine dispute of fact about the protectability of the software code, a crucial factor in their copyright infringement claim. Therefore, the district court's judgment was affirmed. The court also vacated its prior decision in RJ Control Consultants, Inc. v. Multiject, LLC, 981 F.3d 446 (2020), due to lack of appellate jurisdiction at the time of that decision. View "R.J. Control Consultants, Inc. v. Multiject, LLC" on Justia Law