Personal Liability for Patent Infringement
“They can’t sue me personally! Can they?”
How is it possible that you can be personally liable for patent infringement even though you have a company? We all recognize that the whole point of incorporating is to shield individuals from personal liability. Unless a plaintiff can “pierce the corporate veil” and show that an individual and the company are really “alter egos” of one another, one’s individual assets cannot be touched. At least, that’s the common perception of the protection of incorporation. Not necessarily so with patent infringement.
Under a theory of inducing infringement, a corporate officer could be personally liable for inducing a corporation to infringe a patent. Inducement to infringe is a type of indirect infringement claim [35 USC Section 271(b)] – the idea being that the direct infringement [Section 271(a)] of a corporation was aided and abetted by the corporate officer. This claim of indirect infringement does not require a plaintiff to pierce the corporate veil, which would be required in a direct infringement claim.
Inducement to Infringe
Proving inducement to infringe comes with its own challenges. As a threshold, the plaintiff must prove direct infringement by the corporation. If there’s no direct infringement, there can be no indirect infringement.
Assuming the corporation committed direct infringement, the plaintiff has the burden of showing that the accused “inducer”:
>knew of the patent, and
>possessed specific intent to encourage another’s infringement.
The intent element has been described as more than mere knowledge of a direct infringer’s activities. A defendant must have intended to cause the acts that constitute the direct infringement and must have known or should have known that its action would cause the direct infringement.”
How to Protect Yourself from Personal Liability for Patent Infringement
So, what can corporate officers do to protect themselves from personal liability?
First, avoid being a one man company. Surround yourself with other corporate officers and a competent board of directors if possible. It’s harder to prove any one person encouraged a corporation to commit direct infringement if the decision-making process involves a group or at least a few different people.
Second, get an exculpatory legal opinion. If you are aware of a patent, or perhaps more importantly, an aggressive patent owner that might present issues, invest in a well thought out non infringement and/or invalidity opinion letter. Competent legal opinions could serve as evidence that a corporate officer did not possess specific intent to encourage another’s infringement. Furthermore, though willful infringement has a different legal standard, such opinion letters also reduce the risk of a finding of willfulness, which could otherwise result in paying the other side’s attorney’s fees and/or enhanced money damages.
Clean Cut Technologies Receives Patent on Surgical Device Packaging
Congratulations to Clean Cut Technologies for obtaining US Patent No. 7549270 on METHOD FOR PACKAGING ELONGATED SURGICAL DEVICE.
Visual Ice Awarded Patent on Creating Graphics on Glass Surfaces
Congratulations to OC-based Visual Ice for the issuance of US Patent No. 7544390 entitled SYSTEM AND METHOD FOR CREATING GRAPHICS ON GLASS SURFACES. Visual Ice is represented by Vic Lin and the firm of Myers Andras Sherman LLP.
Vonage Gets Approval for First Internally Developed Patent
Vonage, the top dog in the digital phone service arena, announced today that they had received approval on their first internally designed patent.
The patent is titled, “Method and Apparatus for Placing a Long Distance Call Based on a Virtual Phone Number.” and this tech patent will allow their customers to use a virtual number issued by Vonage to contact parties at distant locations without incurring long distance charges. This is a huge jump in the VoIP industry.
Jeffrey Citron, Interim CEO of Vonage was quoted as stating,”This is a major milestone for Vonage as we continue to keep innovation at the heart of our corporate value system,”
The patent is an interesting twist on the existing technology. The process includes a system that connects calls by converting virtual numbers at an originating point to a physical number associated with a destination point.
The virtual number allows a Vonage customer to have a secondary number where they can be reached. For example, one of Vonage’s 2.6 million subscribers that lives in Los Angeles can get a secondary phone number with the same area code as his mother that lives in New Jersey and that way when his mother makes a call to her son, she can simply dial the local secondary number and get connected with her son in Los Angeles without incurring any long distance charges.
Patent Trolls Beware – The Big Boys Are Uniting Against You
Fighting trolls sounds like something straight out of “Lord of the Rings”, but it’s become an unfortunately side effect of all the technological advances that have been made.
According to a report in the Wall Street Journal, the tech giants Cisco, Google, Verizon and HP are working together and with other firms to form the Allied Security Trust.
The purpose of this group will be to purchase intellectual property assets before they can be purchased by patent-holding firms. The cost for each company to join the trust will be roughly $250,000 to join the trust and will each deposit $5 million into a joint pool to purchase future patents for the trust.
Both the tech and telecom industries have both been plagued in recent years by several patent suits filed by patent-holding companies that do not actually produce any of the technology whose rights they own – also referred to as “Trolls” because they “troll” for developments and get patents on technologies years before the technology is even remotely ready to come to market. Then they can file suits against the actual developers of the technology for “infringing” on their patent.
The most prominent such case involved a patent-holding company named NTP that successfully sued BlackBerry maker Research in Motion for infringing upon its patents for e-mail-to-mobile device technology, something everyone with a Blackberry uses.
After getting a $612-million-dollar settlement from Research in Motiion, NTP sued Verizon, AT&T, Sprint Nextel and T-Mobile USA for infringing upon five of the same patents.
You can see how this trust will stop a lot of this activity and protect the larger corporations from troll-based lawsuits. The winners in the end will be us – the consumers because we won’t have to pay the added costs to cover the litigation in our product purchases!
New Virtual Camera Control Technology Patent Approved for Gamecaster
The earliest incarnations of video games such as black and white “Pong” couldn’t have seen the fast developments in the field of gaming and now Gamecaster just took it up a notch further.
They just received approval for their virtual camera control technology meaning the cameras within the virutal environment can be controlled by the user through use of a motion sensor, HD color viewfinder and two thumbstick controls, which mount to a tripod fluidhead and panbars.
The technology can also be mounted to a Steadicam or a shoulder mount for hand-held operation.
This is a remarkable development because it completely enhances the gaming experience as well as the development of all types of media from motion picture pre-visualization, visual effects, and 3-D animation. The technology will allow digital layout artists, and those are the fine folks that plot camera paths and compose shots for feature films and episodic animation, to completely vault over the current limitations for producing cinematic live action-style shots quickly and effectively, in real-time, with the fluidity and precision that only real-life camera equipment operated by a human cameraman can offer.
As far as video game production, that is enhanced as well with easier than ever to create video game cut scenes, trailers, and televised video game tournaments. The technology enables sports cameramen to film the action at video game tournaments from within the game itself. Directors can block multiple cameramen within the game during battles, and call an in-game multicamera live switch consistent with standards used in real-life sports broadcasts. Meaning a director saying, “Okay film on camera 2″ doesn’t just apply to the real world anymore.
Toyota Made to Pay Over Hybrid Patent Dispute
After a lot of legal wrangling and back and forth, the U.S. Federal Court ruled against Toyota and ruled in favor of Paice LLC, a Virginia based firm that develops gasoline-hybrid and owns the patent on the microprocessor that handles the torque information exchange and runs motor via gasoline or electricity.
The court ruled that Toyota had to pay year that Toyota had to pay Paice LLC $4.3 million for using the Virginia-based company’s patented technologies in its gasoline-hybrid vehicles. Additionally, in addition to the $4.3 million reward, Toyota must also pay Paice $25 for every Prius, Highlander Hybrid and Lexus RX400h sold.
Originally, Paice had asked that Toyota be banned from selling those hybrid models at all, however when the case was heard in the U.S. Supreme Court, it was ruled that Toyota could sell those vehicles and the request for a block on the sales was refused.
Apple Files Numerous Patents to Level High Tech Playing Field
Apple made several new patent applications that aim at leveling the corporate market for innovations in the field of wireless technology. These patent apps are aimed to leverage wireless positioning capabilities such as Wi-Fi and GPS and to improve functioning of Apple gadgets that use this technology.
The first patent is US Patent 20080125106 and is titled “Wireless communication out of range indication” and in a nutshell would provide an alert when WiFi or mobile signal is in danger of being lost giving the user the opportunity to take “corrective measures” such as logging off or alerting the person or persons that they are communicating with that the conversation needs to be terminated because of impending signal loss
Apple’s own CEO Steve Jobs is credited as one of the inventors in the filing of US Patent 20080122796 titled “Touch Screen Device, Method, and Graphical User Interface for Determining Commands by Applying Heuristics.” The patent application relates to Apple’s multi-touch technology and will make the touch screens more reliable and easier to use.
In another wireless invention US Patent 20080125040, that is titled “Location discovery using bluetooth,” Apple developed a method and system for locating objects using a Bluetooth communications protocol.
The final patent filed is simply titled ”Media Player System” and was filed under US Patent 20080123285. This patent describes a method of wirelessly connecting the hand held media player to another device. Kind of like beaming from Palm Pilot to Palm Pilot.
Along with the solar powered iPhone that Apple is said to be in development of, there are some cool changes going on at Apple.
The Highly Technical Tire Trash Can
Did you ever think a rubber tire trash can would need a technology patent?
Well, iVoice Technology thinks so.
On June 12th they announced a patent filing for a trash can that is made from recycled tire crumb rubber. This is part of their green platform and their pursuit of more eco-friendly products.
This isn’t just a little modeled circle of rubber to be placed at the corner of your desk, these will be fully functional items. The trash cans will be manufactured from 100% recycled tire crumb rubber. The molded trash can main member has an open top, side walls and a bottom. In some designs, there is an attached or unattached lid, as well as one or more handles. There are optional wheels attached to the bottom for ease of movement.
This was filed on behalf of iVoice’s new “green” platforms, B Green Innovations, Inc., its wholly-owned subsidiary, and this is the third of many green products that will be produced by this division.
Microsoft Patents: “Please, Thank You and May I”
Okay not really those words specifically, but they have applied for a patent that would for all intents and purposes enforce manners in the use of those products you love best– such as your cell phone, your digital camera, DVRs and just about every other hand-held convenience item you can think of.
According to an article by Ars Technica, the patent would use technology to enforce “No flash photography” zones or “No cell phones” in certain areas — and the technology would work by disabling the device entirely during the period of time it was in an area where usage was limited or forbidden.
I can see this heavily implemented in places such as hospitals, and on airplane flights. The technology could further be developed to enforce speed zones and control the acceleration of vehicles.
