Intellectual Property and Tech Law Reports

Burbank Grease Servs. LLC v. Sokolowski, 2006 WI 103 (filed 13 July 2006)

Digest Summary by Profs. Daniel D. Blinka & Thomas J. Hammer in September 2006 Wisconsin Lawyer.

Sokolowski was employed by Burbank Grease Services in various management positions. When he left the company, he took certain information (for example, customer lists and other information about Burbank's customers) without Burbank's permission and with the knowledge that Burbank considered this information to be confidential. The defendant later began working for a different company and then allegedly provided the confidential information to his new employer and used the information to solicit customers for the employer.

When Burbank became aware that the defendant was soliciting its customers, it filed this action alleging that the defendant misappropriated Burbank's trade secrets in violation of Wis. Stat. section 134.90; breached his duty of loyalty to Burbank, which he owed as Burbank's agent; intentionally interfered with Burbank's business relationships; and committed computer crimes in violation of Wis. Stat. section 943.70(2). Burbank also filed claims against the defendant's new employer.

Both sides filed motions for summary judgment. The circuit court granted the defendants' motion and dismissed the complaint. The circuit court concluded that Burbank's confidential information was not protected by Wis. Stat. section 134.90(6), the trade secret statute, because the information did not meet the statutory definition of a trade secret. The circuit court also held that the enactment of section 134.90(6) precluded all common law tort claims based on the misappropriation of confidential information, except those that involved information that met the statutory definition of a trade secret. The circuit court further concluded that there had been no computer crime under Wis. Stat. section 943.70(2) because the defendant was authorized to obtain the computer-stored information at the time he obtained it. The court of appeals affirmed the circuit court. See 2005 WI App 28. In a majority decision authored by Justice Roggensack, the supreme court affirmed in part and reversed in part.

In previous decisions in this case that were not appealed, lower courts concluded that the confidential information described above did not qualify as a trade secret under Wis. Stat. section 134.90(1)(c). The supreme court accordingly did not address that question. Rather, it was asked to decide whether section 134.90(6) precludes Burbank's other claims for relief. The court concluded that "the plain language of Wis. Stat. § 134.90(6)(a) appears to have the effect of making § 134.90 the exclusive remedy for civil claims based on the misappropriation of a statutorily-defined trade secret" (¶ 20). However, the language in section 134.90(6)(b)2. leaves available all other types of civil actions that do not depend on information that meets the statutory definition of a "trade secret." Therefore, any civil tort claim not grounded in a trade secret, as defined in the statute, remains available to Burbank (see ¶ 33).

The court also addressed the applicability of Wis. Stat. section 943.70(2)(a)6., which prohibits the willful, knowing, and unauthorized disclosure of "restricted access codes or other restricted access information to unauthorized persons." The court concluded that this statute "was meant to prohibit disclosing information that would permit unauthorized persons to access restricted or confidential information. There has been no allegation that [the defendant] provided information to others that would permit them to access Burbank's computer system" (¶ 37). "In sum, we agree with the court of appeals' construction of Wis. Stat. § 943.70(2)(a)6, that it prohibits the unauthorized disclosure of codes, passwords or other information that grants access to restricted-access systems. We also agree with the court of appeals' conclusion that the statute was not meant to criminalize the disclosure of all types of information that could be stored on a computer, when that information was obtained with authorization in the first instance" (¶ 39) (citation omitted).

Justice Bradley filed a dissenting opinion that was joined by Chief Justice Abrahamson.

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Ross, Brovins & Oehmke, P.C. v. Lexis Nexis Group

This is a copyright dispute regarding software for filling out legal forms. LawMode compiled and organized a number of Michigan legal forms and, using a Lexis owned program, created templates for filling out the forms. After marketing LawMode’s product for five years, Lexis terminated its contract with LawMode and proceeded to compile, create, and market its own set of Michigan form templates. LawMode sued Lexis for copyright violation and contract breach. We affirm the district court’s judgment dismissing LawMode’s copyright claims against Lexis. First, while LawMode has a valid copyright in both the selection of forms in its compilation and the organization of those forms, the copyrighted work is not substantially similar to the allegedly infringing Lexis product. Second, LawMode’s selection and placement of input items for its form templates involves too little creativity to warrant copyright protection, and Lexis consequently did not commit copyright infringement in this regard. However, we reverse the district court’s dismissal of LawMode’s breach-of-contract claim pursuant to a motion for judgment on the pleadings because LawMode stated a claim for breach of contract.

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BondPro Corp. v. Siemens Power Generation, Inc.

In its reply brief BondPro acknowledges that “many of the elements of the BondPro slot cell manufacturing process were in the public domain” but states that “the precise execution of each element, in conjunction with the precise execution of each additional element, renders BondPro’s process a secret.” But BondPro has not told us what those details of execution or implementation are. For example, in the list of nine components the temperature and the duration of the application of heat are stated as a broad range rather than as specific numbers—and anyway Wang obtained the range from Siemens! And a broad range was all that Siemens’s patent application disclosed—so if BondPro’s trade secret resides in specifics that have not been disclosed to us, Siemens is not responsible for their disclosure.

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Automation by Design, Inc. v. Raybestos Prods. Co.

In this copyright infringement dispute, Automation by Design, Inc. (ABD) alleges that Raybestos Products Company, a wholly owned subsidiary of Raytech Corp., (together “Raybestos” or “RPC”) infringed on its copyright and breached their agreement when it hired Production Design Services, Inc. (PDSI) to build a duplicate machine of one that ABD had designed and built for Raybestos several years earlier. Because we find that Raybestos did not violate the terms of the license agreement, we affirm the decision of the district court granting summary judgment and declaratory judgment in favor of the defendants, Raybestos and PDSI.

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Massachusetts Inst. of Tech. v. Abacus Software

Massachusetts Institute of Technology (“MIT”) and Electronics for Imaging, Inc. (“EFI”) appeal from the stipulated final judgment of noninfringement of the United States District Court for the Eastern District of Texas. MIT and EFI urge that the district court’s claim construction (on which the stipulated judgment of non-infringement was based) was erroneous. Appellants also urge that the district court’s order granting Microsoft’s motion to exclude Windows as an infringing product was erroneous. We vacate the grant of summary judgment and remand for further proceedings because we hold that the district court erred in its construction of “aesthetic correction circuitry,” and erred in excluding Windows as an infringing product. We decline to address claim construction issues not implicated by the judgment. We dismiss the cross-appeals since the cross-appeals, if successful, would not expand the scope of the judgment. We decline to reach the question whether the district court properly denied the parties’ motions for summary judgment on the marking statute issues since the district court has not finally decided whether the marking statute bars the claims. We dismiss as moot the appeals insofar as they arise from orders that were granted in favor of Fry’s Electronics, Inc. (“Fry’s”) and Arcsoft, Inc. (“Arcsoft”) because both those parties have been voluntarily dismissed from this action.

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Manual of Patent Examining Procedure

Revised MPEP with August 2006 CFR changes and searchable index released by USPTO.

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Alza Corp. v. Mylan Labs., Inc.

Alza Corp. (“Alza”) appeals from the district court’s judgment, after a bench trial, of noninfringement and invalidity of claims 1-3, 11, 13 and 14 of U.S. Patent No. 6,124,3551 (“the ’355 patent”) in favor of Mylan Laboratories, Inc. and Mylan Pharmaceuticals, Inc. (collectively, “Mylan”). Alza Corp. v. Mylan Labs., Inc., 388 F. Supp. 2d 717 (N.D.W. Va. 2005) (“Alza II”). The infringement arose from Mylan’s filing of two Abbreviated New Drug Applications (“ANDAs”) for a generic version of the once-a-day extended release formulation of the anti-incontinence drug oxybutynin, id. at 720, which Alza has been marketing as Ditropan XL®. Id. at 738. This court has jurisdiction pursuant to 28 U.S.C. § 1295(a)(1). For the reasons stated below, we affirm the district court’s judgment of noninfringement and invalidity.

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Ormco Corp. v. Align Tech, Inc.

Ormco Corporation and its subsidiary, Allesee Orthodontic Appliances, Inc. (collectively “Ormco”), appeal from the judgment of the United States District Court for the Central District of California finding, inter alia, that claims 1-3 and 7 of Align Corporation’s (“Align’s”) U.S. Patent No. 6,554,611 (the ‘611 patent) and claims 10 and 17 of Align’s U.S. Patent No. 6,398,548 (the ‘548 patent) are infringed by Ormco’s “Red, White & Blue” (“RW&B”) orthodontic product; that those claims are not invalid; and that Align did not engage in inequitable conduct during prosecution of the ‘611 and ‘548 patents. We reverse the district court’s grant of summary judgment that the patents are not invalid, and hold that all six claims would have been obvious under 35 U.S.C. § 103(a) (2000). We therefore need not reach the district court’s finding of infringement. We also need not reach the issue of inequitable conduct because Ormco has agreed that the court need not address the issue of inequitable conduct if the claims are held invalid.

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