Legal Pad

Blogger Files Suit Claiming Theft of Gizmo Idea

Loud Silicon Valley blogger Mike Arrington has now filed a lawsuit against the company that took his allegedly brilliant idea for an Internet-surfing tablet called the CrunchPad.

The suit, filed by Winston & Strawn's Andrew Bridges, can be viewed right here (.pdf). Earlier this week, we told you about the dispute between the TechCrunch blog founder and Fusion Garage, a Singapore company that was working with Arrington to build the device, but then cut Arrington out right before launching it under the name Joo Joo.

The suit levels accusations of trademark infringement and misappropriation of "business ideas" as well as fraud and deceit. Legal observers told Legal Pad that Arrington would have a hard time winning the case if there was no contract between the parties, as Fusion Garage's founder claimed in interviews. And indeed, the complaint doesn't mention any contract between the two to develop the CrunchPad.

But Bridges told us that there are other documents that do the job: "The complaint certainly refers to written materials that discuss agreed terms," Bridges said.

Those would be emails between Arrington and Fusion Garage CEO Chandrasekar Rathakrishnan talking about how they would soon be officially merging. Chandrasekar also spent time working with the TechCrunch people right in the blog's office.

Bridges said he didn't know whether Fusion Garage had retained a lawyer.

— Zusha Elinson

Fenwick Lawyer Trolls For Change at Federal Circuit

It was a good Friday for Fenwick & West’s Charlene Morrow, who got client Hewlett-Packard out of a jam and caused the Federal Circuit — the high court of patent case appeals — to move the needle a little toward companies who want to squash patent trolls before they get started.

Morrow was arguing that a declaratory judgment action her client HP had filed against patent holder Acceleron shouldn’t have been tossed by the district court in Delaware. What happened is that Acceleron sent a vaguely threatening letter to HP about a patent it had (the letter can be read, along with the opinion, here: (.pdf )

HP filed an action in Delaware, asking the court to rule that it didn’t infringe on Acceleron’s patents and that the patents were invalid. But Acceleron protested that it hadn’t even really threatened HP, so there was no reason to judge anything declaratorily. “At the time HP filed its complaint, Acceleron could not have asserted its rights in the ’021 patent against HP because it had not even determined if it had a basis to assert the patent against HP,” Acceleron’s lawyers from Alston & Bird wrote. Delaware Judge Sue Robinson agreed and tossed the suit.

Then the reversal, suggesting trolls have less appeal …

Crunch Time for CrunchPad

It really doesn’t get much more Silicon Valley than this.

Influential, tantrum-prone tech blogger Mike Arrington came up with an idea for a touch screen tablet that will only be used to surf the web. Arrington and his fellow bloggers at TechCrunch were so enamored with their idea that they started working to produce the “CrunchPad” with a startup from Singapore called Fusion Garage. A few days before the launch, Fusion Garage allegedly decided to cut Arrington out of the picture.

See if that made him mad, after the jump

Fed Circuit Still Trying to Bust Up Eastern District's Game of Texas Hold 'Em

We thought that Texas judges would get the idea after the Federal Circuit slapped them around last year for not transferring patent cases that had no earthly reason for being there except that it’s a plaintiff-friendly district.

But noooooo! Today, the Federal Circuit, which handles all appeals in patent cases, declared (.pdf) that Eastern District of Texas Judge David Folsom’s court “clearly abused its discretion” by denying pharma giant Hoffman-La Roche’s motion to transfer in its patent fight with Novartis.

Last year, the Fed Circuit said the same nasty thing to Judge John Ward when he denied TS Tech Co.'s motion to transfer its patent fight with Lear Corp. to a more convenient venue in Ohio.

The facts of the current case are this: Novartis sued Hoffman-La Roche in Texas. Hoffman-La Roche, represented by Fried Frank, protested saying that all the witnesses and evidence were nearer to the Eastern District of North Carolina. Well, Novartis’ lawyers at MoFo said that witnesses and sources of proof were actually spread about the country. Judge Folsom agreed, and kept the case in Texas. Hoffman-La Roche shot for a writ of mandamus and the Fed Circuit granted it. Here’s the salient passage from Judge Arthur Gajarsa:

The Eastern District of North Carolina’s interest in this matter is self-evident. Meanwhile, it is undisputed that this case has no relevant factual connection to the Eastern District of Texas. The district court ignored this significant contrast, reasoning that “where a number of private interest factors weigh heavily in one direction, that venue has a slightly greater local interest,” but “[w]here, however, the factors do not weigh heavily in one direction of [sic] the other, no one venue has more or less a meaningful connection to the case than any other.” By relying exclusively on how other forum non conveniens factors weigh, rather than assessing the locale’s connection to the cause of action, the district court essentially rendered this factor meaningless. Therefore, because the Eastern District of North Carolina has a meaningful local interest in adjudicating the dispute and no meaningful connection exists with the Eastern District of Texas, this factor also favors transfer.

— Zusha Elinson

What the I.P. Judge Grants, The I.P. Judge Takes Away ...

Farella Braun & Martel lawyers were pretty excited about winning a rare preliminary injunction for client Volterra Semiconductor in a patent case against Infineon. Now, Infineon’ lawyers from McDermott Will & Emery are even more excited, because U.S. Magistrate Judge Joe Spero reversed his own preliminary injunction ruling.

The order was filed under seal last week so we don’t know the details. But basically Spiro said in a minute order he was going to grant an injunction but then after more briefing by both sides, decided against it.

“We said we would pursue this vigorously and we did. We are extremely pleased,” said Terry McMahon, who represents Infineon, in a prepared statement.

— Zusha Elinson

Trademark Fight Draws a Line on Sand Hill Road

A legal battle for the trademark rights to the very heart of Silicon Valley is under way. Sand Hill Advisors, the Palo Alto wealth management company, is suing Sand Hill Advisors, the commercial real estate company in Los Altos, for trademark infringement. Confusing!

For the three people who are still unaware, Sand Hill Road is the iconic stretch of pavement near which the sainted feet of venture capitalists tread daily to their places of work.

Sand Hill Advisors, the wealth management one, claims it’s been using the mark since 1995 and that its alleged namesake has been profiting off the use of the name since 1999. The complaint (.pdf) was filed by Shartsis Friese lawyers in San Francisco.

Well, Sand Hill Advisors may have picked the wrong Sand Hill Advisors to pick a fight with because Sand Hill Advisors, the commercial real estate one, is NOT GOING TO SETTLE.

Fight! Fight! Remember, folks, absolutely no wagering! Just click for the jump …

Like Britney Spears Needs Another (Patent) Problem

Britney Spears (provided to Wikimedia by Sarah Pitre)

What do Justin Timberlake, Britney Spears, the Pussycat Dolls and the Los Angeles Lakers have in common, besides being awesome?

Yup, they’ve all been sued for patent infringement by Large Audience Display Systems.

I know what you’re thinking: How is it that Large Audience has a patent on being crazy sexy cool? Did they buy it from TLC?

It seems that Large Audience has a patent on “Large-audience, positionable imaging and display system for exhibiting panoramic imagery, and multimedia content featuring a circularity of action.” Try working that into one of your pop songs. So basically if you have a big screen at a concert, you owe this patent troll money. And these guys are repeat offenders, according to the lawsuit (.pdf, with concert pics!) filed in Texas.

When asked for comment about the repeated offenses, Spears answered: “Oops! I did it again.”

Timberlake was less conciliatory, simply telling the lawyers at the Burk Law Firm to go “Cry me a river.”

—  Zusha Elinson

Justices Take Comedic Shots at Bilski Lawyer

The Supremes had a field day with Bilski today, our colleague and IP maven Joe Mullin reports.

This is the huge patent case over whether you can patent so-called business methods. In this case, Bernard Bilski patented a method for hedging commodities. Please.

As Mullin reports, the Justices needled Bilski’s lawyer, Michael Jakes of Finnegan Henderson, Farabow, Garrett & Dunner endlessly about just how ridiculous his client’s patent is.

A selection of our favorite zingers, after the jump:

Was Lawsuit Hype to Shake eBay Down for a Bite of Skype?

EBay settled a copyright lawsuit against Skype today and, oh my god, it turns out it was just filed as leverage in deal negotiations. What has the legal profession come to when lawsuits are no longer filed for the love of the law and actual grievances?

Here’s what happened: eBay was in the midst of selling Skype to some private investors, including Andreeson Horowitz and Silver Lake Partners, because the online auction company actually never figured why in the world it bought the Internet telephone service. Then, the guys who came up with Skype in the first place -- and have since formed a company called Joltid — sued everyone involved in the deal, claiming that Skype didn’t have a license for some of the essential technology and IP. An injunction was threatened. And then today, the folks from Joltid agreed to drop the suit, and in exchange were allowed to buy a 14 percent stake in Skype. As one of the lead investors, Marc Andreeson, told The Wall Street Journal: "There is fighting, and then there is negotiation … We believe it is as a plus to have founders involved. They now have a complete alignment of interest." That about sums it up.

A bunch of local lawyers were involved with the “lawsuit.” Lawrence Hadley of L.A.’s Hennigan Bennett & Dorman represented the jilted at Joltid. Irell & Manella represented Skype. Weil Gotshal’s Matt Powers represented eBay. WilmerHale’s Mark Selwyn from Palo Alto represented investor Silver Lake Partners. Diana Marie Torres of Kirkland & Ellis in L.A. represented Marc Andreeson’s venture fund, Andreeson Horowitz. And O’Melveny & Myers S.F. IP lawyer Darin Snyder had the Canada Pension Plan Investment Board, another investor.

— Zusha Elinson

Amazon's Fenwick Lawyers Carve a Nook: Suing Barnes & Noble

Barnes & Noble’s e-book reader, cutely named the Nook, is now the target of a lawsuit (.pdf) alleging trade-secret theft, filed by a small Fremont company called Spring Design Inc. Interestingly, Spring Design has hired Fenwick & West’s Lynn Pasahow, the very same lawyer who does most of the IP work for Amazon.com, Barnes & Noble’s primary competitor. Seems like Amazon would be pleased with a lawsuit that kindles a little trouble for the newly unveiled Nook, right?

Legal Pad caught up with Fenwick partner David Hadden, who’s working with Pasahow on the case, and he said that Amazon had absolutely nothing to do with the lawsuit. It’s not funding it; Spring Source is paying for its own lawyers — and not on contingency fee. It’s just coincidence, he said. Pasahow and Hadden have battled Barnes & Noble when they sued the book company with Amazon.com’s questionable one-click patent.

Hadden said that Spring Design shared its plans for an e-book reader with Barnes & Noble. It was surprised when the Nook came out with all the same features, including the famous interactive dual screen design that has given the Nook an edge on Amazon’s much-hyped e-book gizmo, Hadden said.

— Zusha Elinson