Smartsky Networks, LLC v. DAG Wireless, LTD.

Court: US Court of Appeals for the Fourth Circuit

Docket: 22-1253

Opinion Date: February 13, 2024

Judge: Rubin

Areas of Law: Arbitration & Mediation, Business Law, Commercial Law, Contracts, Intellectual Property

In a dispute between SmartSky Networks, LLC and DAG Wireless, Ltd., DAG Wireless USA, LLC, Laslo Gross, Susan Gross, Wireless Systems Solutions, LLC, and David D. Gross over alleged breach of contract, trade secret misappropriation, and deceptive trade practices, the United States Court of Appeals for the Fourth Circuit ruled that the district court did not have the jurisdiction to enforce an arbitration award. Initially, the case was stayed by the district court pending arbitration. The arbitration tribunal found in favor of SmartSky and issued an award, which SmartSky sought to enforce in district court. The defendants-appellants argued that, based on the Supreme Court decision in Badgerow v. Walters, the district court lacked subject matter jurisdiction to enforce the arbitration award. The Fourth Circuit agreed, noting that a court must have a basis for subject matter jurisdiction independent from the Federal Arbitration Act (FAA) and apparent on the face of the application to enforce or vacate an arbitration award. The court concluded that the district court did not have an independent basis of subject matter jurisdiction to confirm the arbitration award. As such, the court reversed and remanded the case to the district court for further proceedings.

In Re CHESTEK PLLC

Court: US Court of Appeals for the Federal Circuit

Docket: 22-1843

Opinion Date: February 13, 2024

Judge: LOURIE

Areas of Law: Government & Administrative Law, Intellectual Property, Trademark

In 2020, the law firm Chestek PLLC applied for a trademark for the mark "CHESTEK LEGAL" but provided only a P.O. box as its domicile address. The United States Patent and Trademark Office (USPTO) refused the application because it did not comply with the domicile address requirement. Chestek argued that the rules enforcing this requirement were improperly promulgated under the Administrative Procedure Act (APA). The Trademark Trial and Appeal Board affirmed the examiner's refusal. On appeal to the United States Court of Appeals for the Federal Circuit, Chestek argued that the domicile address requirement was improperly promulgated for two reasons: the USPTO was required to comply with the requirements of notice-and-comment rulemaking under 5 U.S.C. § 553 but failed to do so because the proposed rule did not provide notice of the domicile address requirement adopted in the final rule, and the domicile address requirement is arbitrary and capricious because the final rule failed to offer a satisfactory explanation for the domicile address requirement and failed to consider important aspects of the problem it purports to address, such as privacy. The Federal Circuit found the domicile address requirement to be a procedural rule that is exempt from notice-and-comment rulemaking. Furthermore, the USPTO's decision to require the address provided by all applicants to be a domicile address was not arbitrary or capricious for failure to provide a reasoned justification. The court affirmed the Board's refusal to register Chestek's mark.

NATERRA INTERNATIONAL, INC. v. BENSALEM

Court: US Court of Appeals for the Federal Circuit

Docket: 22-1872

Opinion Date: February 15, 2024

Judge: Cunningham

Areas of Law: Intellectual Property, Trademark

The United States Court of Appeals for the Federal Circuit reviewed a decision by the Trademark Trial and Appeal Board denying Naterra International, Inc.'s petition for cancellation of Samah Bensalem's BABIES’ MAGIC TEA standard character mark registration. Naterra argued that there was a likelihood of confusion between its BABY MAGIC mark and Bensalem’s BABIES’ MAGIC TEA mark. The Court examined several factors, including the similarity of the marks, the nature of the goods, and the trade channels. The Court found that the Board erred in its assessment of the similarity of the marks and the trade channels and failed to properly evaluate relevant evidence about the nature of the goods. Therefore, the Court vacated the Board's decision and remanded the case for further proceedings. The Court also found the Board did not err in its assessment of the fame of Naterra's mark.

RAI Strategic Holdings, Inc. v. Philip Morris Products S.A.

Court: US Court of Appeals for the Federal Circuit

Docket: 22-1862

Opinion Date: February 9, 2024

Judge: Stoll

Areas of Law: Intellectual Property, Patents

This case concerns a patent dispute between RAI Strategic Holdings, Inc. (RAI) and Philip Morris Products S.A. (Philip Morris) about an electrically powered smoking article. The United States Court of Appeals for the Federal Circuit affirmed in part, vacated in part, and remanded the decision of the Patent Trial and Appeal Board (Board).

RAI owns a patent for electrically powered smoking articles that heat tobacco or other substances without significant combustion. Philip Morris filed a petition to review the patent, asserting that the claims were invalid due to a lack of written description and obviousness over prior art. The Board agreed with Philip Morris and held certain claims of the patent unpatentable.

On appeal, RAI argued that the Board erred by finding that some claims lacked adequate written description support and that other claims were obvious. The Court of Appeals agreed with RAI regarding the written-description issue. It found that the patent specification did provide adequate written description support for the disputed claims, as it disclosed the end points of the claimed range and there were no inconsistent statements regarding the range. Thus, the Court of Appeals vacated the Board's decision on this issue and remanded for further consideration.

However, the Court of Appeals affirmed the Board’s decision regarding the obviousness issue. It found substantial evidence to support the Board's finding that a person of ordinary skill in the art would have been motivated to combine prior art references, making the claims obvious. Specifically, the Court found that the Board reasonably concluded that a skilled artisan would have been motivated to replace the heating element in Robinson's smoking article with the heating element taught by Greim. Therefore, the Court affirmed the Board’s finding that these claims were unpatentable as obvious.

University of South Florida Board of Trustees v. United States

Court: US Court of Appeals for the Federal Circuit

Docket: 22-2248

Opinion Date: February 9, 2024

Judge: TARANTO

Areas of Law: Government & Administrative Law, Intellectual Property, Patents

In this case, the University of South Florida Board of Trustees (USF) sued the United States, claiming that the latter infringed a patent owned by USF regarding genetically modified mice for Alzheimer's Disease research. The USF contended that The Jackson Laboratory, with the government's authorization and consent, had been producing and using mice covered by the patent for the government. The government countered the claim by asserting it had a license to practice the patent under a provision of the Bayh-Dole Act, which addresses patent rights in work funded by the federal government. The United States Court of Appeals for the Federal Circuit determined that the provision does apply and therefore affirmed the judgment of noninfringement. The court confirmed that the April 1997 work, the first actual reduction to practice of the invention, was "in the performance of work under a funding agreement." The court also rejected USF's contention that a funding agreement must be in place at the time of the relevant work, clarifying that the Act can cover work already performed before a funding agreement is executed or becomes effective.

BioCorRx, Inc. v. VDM Biochemicals, Inc.

Court: California Courts of Appeal

Docket: G061535A(Fourth Appellate District)

Opinion Date: February 9, 2024

Judge: MOORE

Areas of Law: Business Law, Contracts, Intellectual Property

In this case, BioCorRx, Inc., a publicly traded company engaged in providing addiction treatment services and related medication, was involved in a dispute with VDM Biochemicals, Inc., a company specializing in chemical synthesis and distribution. The dispute arose from a business relationship in which BioCorRx intended to partner with VDM to develop and commercialize a compound for treating opioid overdose, known as VDM-001. BioCorRx issued several press releases, allegedly making misrepresentations and improperly disclosing confidential information about the development of VDM-001. VDM filed a cross-complaint against BioCorRx and its president, Brady Granier, for breach of contract, fraud, and violation of trade secrets among other claims. In response, BioCorRx and Granier filed a motion to strike the allegations based on the anti-SLAPP statute, arguing that the press releases were protected speech under the statute.

The Court of Appeal of the State of California, Fourth Appellate District, Division Three, ruled that the press releases fell within the commercial speech exemption of the anti-SLAPP statute, as they were representations about BioCorRx’s business operations made to promote its goods and services to investors. As such, these statements were not protected by the anti-SLAPP statute. Consequently, the court reversed the portion of the trial court’s order granting the anti-SLAPP motion as to the press releases. However, the court affirmed the portion of the order granting the anti-SLAPP motion as to Brady Granier, BioCorRx’s president, due to insufficient argument presented against this part of the ruling.