Archive for June, 2008

CleanTech 2008 Exhibition (Israel) Report

June 29th, 2008

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Earlier this month I attended the CleanTech 2008 Summit and Exhibition in Israel.  The trade show focused on renewable energy, conservation technology, and, not surprisingly given the country’s climate and neighborhood, water technologies.

One company that stood out was Hydropath Holdings Ltd. (Hydropath), a British water treatment firm who was exhibiting its technology through its Israeli marketer, Waterpath (itself a division of Pazgas, an Israeli gas company).  Hydropath’s technology cleans limescale in commercial, industrial and residential water systems without the use of chemicals by a device that attaches to pipes and generates electric fields in the water flow.  According to Hydropath’s web site, 1 mm of limescale deposition can reduce the efficiency of a residential boiler by 10%.

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Limescale deposits occur when positively and negatively charged ions such as calcium carbonate and bicarbonate exceed a maximum concentration and crystalize out of solution onto pipe surfaces.  Crystallization can be either homogeneous (the initial “seed” crystals are formed by oppositely charged ions of the dissolved substance) or heterogeneous (the initial seed crystals are formed by ions on an alien substance such as a pipe surface).  This latter type of crystallization leads to scale deposition on pipes.  Homogeneuously-formed crystals, on the other hand, are carried through the pipe without impeding water flow.

Hydropath owns several patents and applications in the U.S. and abroad, including U.S. Patent No. 5,667,677 (677 patent) and two applications, International Pub. Nos. WO 2007/045824 (’824 application) and WO 2008/017849 (’849 application).  As described in the ’849 application, the electric field produced by Hydropath’s device orients the molecules so all of the positively charged ions are aligned and traveling in one direction, and all the negatively charged ions are aligned and traveling in the opposite direction.  This increases the odds of collision between particles of opposite charge, and leads to increased growth of the benign homogeneous crystal clusters.  It also decreases the saturation level of the solution, so existing limescale deposits can re-enter solution and flow out.

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The ’824 application discloses using the electric field to provide a more energy efficient desalination process.  The electric current causes water to re-orient into a thin layer of molecules with positive poles on one side and the negative poles on the other side.  This “hydration” layer excludes other molecules and contains substantially pure water, which can be extracted using less energy than other desalination methods.

Hydropath’s patented technology has many applications, including boilers, heat exchangers, swimming pools and fuel pipes, and according to the company’s web site, can be used to combat bacteria, algae and other substances in addition to limescale.

EcoVision Accused of Infringing COMPOSTABLE Eco-Mark

June 26th, 2008

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The Biodegradable Products Institute (BPI) is a New York-based organization that promotes the use and recycling of biodegradable polymeric materials.  BPI has a labeling program to certify plastic products that will safely and completely biodegrade and compost in accordance with the group’s standards.  Companies apply to BPI to have their products reviewed and, if they pass muster, they can affix BPI’s label to them.

In 2003, BPI got a federal registration (reg-no-2783960.pdf) for its COMPOSTABLE certification mark (pictured above).  Certification marks differ from ordinary trademarks in that they certify that goods or services meet certain quality or manufacturing standards instead of indicating the commercial source of a product.  Certification marks are owned by the organizations that set the standards and used by companies that meet the standards and earn the certifications. 

Earlier this month BPI sued several individuals operating EcoVision Alternatives (EcoVision), a Burlingame, California company that makes biodegradable bags and food containers, in federal court in Los Angeles for federal and state trademark infringement, counterfeiting and unfair competition.  The complaint alleges that EcoVision infringed BPI’s certification mark by selling bags and containers that display the COMPOSTABLE mark and by stating on its web site that its products are “BPI certified” when EcoVision never applied to BPI’s labeling program and the products were not certified.

According to the complaint (biodegradablecomplaint.pdf), this is not the first instance of infringement by the EcoVision crowd.  The complaint states that EcoVision wrongfully used BPI’s certification mark earlier this year when the company was operating under the name Biosphere Alternatives (Biosphere).  At the time, BPI contacted Biosphere to ask them to stop using the mark and subsequently sent a cease and desist letter.  BPI alleges that EcoVision is acting now with full knowledge of its wrongdoing and malicious intent and therefore accuses the company of willful infringement.

The counterfeiting claim is a bit unusual for a certification mark infringement suit; counterfeiting is more typical where the infringing goods are high end consumer products like Rolex watches or Gucci handbags.  But the motivation for the claim is clear – in the case of willful use of a counterfeit mark, the federal trademark statute provides for a minimum damages award of $1 million.

Apple’s Patent Application May Portend Solar iPhones

June 24th, 2008

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A recently-published patent application filed by Apple Computer (Apple) is making a splash and fueling speculation that the computer and electronics giant will soon be launching solar-powered mobile devices, including a sunny version of the super-trendy iPhone. 

U.S. Patent Application Pub. No. 2008/0094025 (’025 application) published in late April and is entitled “Solar Cells on Portable Devices.”  The ’025 application is directed to processing systems coupled with solar cells and methods for connecting solar cells to portable devices. 

The basic idea of connecting solar cells to portable devices is probably obvious in both the colloquial and patent law sense (non-obviousness is one of the main criteria for patentability, and a combination of known elements must be non-obvious to be patentable).  With the ’025 application, Apple seems to be betting that its solution for maintaining a consistent voltage and sufficient power output with a small number of solar cells, even when some of the cells are obstructed (e.g., because of a user holding the device), is worthy of patent protection.

The ’025 application describes a way to arrange solar cells so that some cells will continue to function while others are blocked from sunlight.  The system involves networks of cells connected both in series (end to end so the current flows in a single path) and in parallel (the current flows through each component, providing the same voltage across all components).

In one example disclosed by the ’025 application, two individual solar cells of a first type (“A1″ and “A2″) are connected in parallel, and two individual solar cells of a second type (“B1″ and “B2″) are connected in parallel.  These two pairs of cells are then connected to each other in series (i.e., A1/A2 is connected to B1/B2).  The pairs are arranged in an alternating checkerboard pattern so A1 is diagonally opposite A2 and B1 is diagonally opposite B2.  According to the patent application, this arrangement provides more consistent power output in the event of obstruction of sunlight.

No word yet on whether Apple will be launching its solar electronics, when it will do so, or which products will be getting the solar treatment.  But this is a patent application everyone will be watching.

Court Orders Ex-Xantrex Veep to Stop Solar Inverter Work for Competitor

June 22nd, 2008

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British Columbia based Xantrex Technology (Xantrex) makes advanced power electronic products that convert electrical power into other forms of energy.  One of Xantrex’s major markets is renewable energy, and the company is a world leader in production of solar inverters (pictured below).  Solar inverters convert DC power captured by solar panels into AC electrical energy.  The energy is then provided directly to customers or to a utility or electrical grid.

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In November 2007, Xantrex sued Advanced Energy Industries (AE) and Christopher S. Thompson in federal court in Colorado, alleging, among other things, breach of Thompson’s employment agreement (against Thompson), misappropriation of trade secrets under Colorado law (against Thompson), breach of fiduciary duty and aiding and abetting such breach (against Thompson and AE, respectively), tortious interference with contract (against AE) and violation of the federal Computer Fraud & Abuse Act (against Thompson and AE). 

Last month Judge Wiley Y. Daniel denied the defendants’ motion to dismiss (based on a forum selection clause in Thompson’s employment agreement) and granted Xantrex’s motion for a preliminary injunction (PI), ordering that Thompson could not work for AE as Vice President and General Manager of Solar Inverters (or work on solar inverter technology for any other North American competitor of Xantrex) for a period of one year (xantrexorder.pdf).  Thompson and AE were also ordered not to use or disclose any Xantrex trade secrets.

Xantrex’s complaint (xantrex.pdf) alleged that Thompson breached his employment agreement by leaving Xantrex and immediately starting employment with AE (the non-compete provision prohibited Thompson from working for any competitor within one year of leaving Xantrex).  Thompson worked on solar inverter technology at Xantrex, and AE entered the solar inverter market shortly before Thompson joined AE. 

While at Xantrex, Thompson was Vice President of Engineering and Product Development and had access to the company’s confidential information.  According to the complaint, Thompson had played a leading role in acquiring and integrating certain cutting edge solar inverter technology into Xantrex’s products. 

The complaint also alleged assorted shenanigans by Thompson shortly before he left Xantrex, including downloading and transferring confidential Xantrex documents from his laptop, attempting to delete files to cover his tracks, and using Xantrex’s confidential market data to create market plans for AE.

Judge Daniel found the PI factors (likelihood of success on the merits, irreparable harm to Xantrex, threatened injury to Xantrex greater than harm of a PI to AE, and effect of PI on public interest) weighed in favor of granting the PI.  The irreparable harm is that AE would get a head start into the solar inverter market based on Xantrex work, money and trade secrets if Thompson were permitted to take a position at AE nearly identical to the one he had at Xantrex.

As to success on the merits of the trade secrets claim, Judge Daniel found enough evidence that the confidential information accessed by Thompson prior to leaving Xantrex rises to the level of trade secrets (e.g., solar inverter product development information and data on the benefits of various product features).  The court also found that Thompson’s rapid accessing of trade secret documents just before leaving Xantrex was of particular concern because his ready recollection of possible trade secrets would make their use by AE possible without him actually telling anyone.  In other words, Thompson’s mere knowledge of the information would make misappropriation likely.

The court also found Xantrex would be likely to succeed on the breach of contract claim.  Interestingly, Judge Daniel analyzed the non-compete provision under Canadian law, which strongly disfavors such restrictive covenants.  The court therefore took a “blue pencil” approach and modified the clause so the geographic restriction, which was global in scope, only covered North America.  With this modification, Judge Daniel found the breach of contract claim likely to succeed under British Columbia law. 

Has Gertrude Rothschild Become the Ronald Katz of Clean Tech?

June 19th, 2008

Recently, four more electronics companies – Sony, Sanyo, Exceed Perseverance and Lucky Light - took licenses from retired Columbia prof and LED innovator Gertrude Neumark Rothschild.  These four were recently targeted by Rothshild in the U.S. International Trade Commission (ITC) in a complaint that named over 25 respondents.

These licensees join Epistar, Toyoda Gosei, Osram and Philips Lumileds, so now eight different companies have taken a license under Rothschild’s U.S. Patent Nos. 4,904,618 and 5,252,499.  The patents relate to methods of doping semiconductors, which means adding impurities to increase the number of free charge carriers.  Rothschild’s patented process made high spectral range LEDs, such as blue and green, commercially feasible. 

Rothschild is quickly becoming the Ronald Katz of LEDs and perhaps the first such phenomenon in clean technology.  Katz was an innovator in the field of automated telephone call center technology and is the named inventor on over 50 patents (full disclosure: I worked on litigation on behalf of Katz for about six months while I was an associate at a previous law firm).  

Katz is now in the business of collecting licensing fees from various companies through both negotiation and litigation.  He has been staggeringly successful in this regard:  more than 200 companies have licensed his technology, and he has made hundreds of millions of dollars.

There are some notable parallels between Katz and Rothschild, including that they are both true innovators of important technology, they are both named inventors on the patents they assert (which some people believe insulates them from the patent troll label) and they are now in the business of collecting license fees instead of practicing their technology. 

Perhaps the most important similarity is that their technology is ubiquitous across many different industries, so there are loads of potential infringement targets.  Companies from many industries including credit cards, pharmacies and utilities use automated telephone calling technology for sales and customer service.  Similarly, LEDs are used by the billions in a wide array of applications from instrument panels to traffic lights to cell phones as an energy-efficient substitute for incandescent bulbs.  It is probably for this reason that Rothschild has initially been so successful following in Katz’s footsteps, and she is likely to end up as filthy rich. 

PTO Rejects GREEN PATENT BLOG Trademark Application as “Merely Descriptive” (Prosecuting Eco-Marks, Part I)

June 17th, 2008

In February, I filed a trademark application (gpbapplication.pdf) in the U.S. Patent & Trademark Office (PTO) for GREEN PATENT BLOG.  I figured I would compromise my credibility in matters of green intellectual property (IP) if I didn’t take available measures to protect my own green IP.

In the application, I avoided the trouble with eco-marks that I discussed in a couple of previous posts (see here and here).  That is, I drafted the listing of services to indicate their green aspect.  My listing is as follows:

ON-LINE JOURNALS, NAMELY, BLOGS FEATURING NEWS, INFORMATION AND LEGAL ANALYSIS RELATING TO INTELLECTUAL PROPERTY LAW ISSUES IN THE CLEAN TECHNOLOGY AND RENEWABLE ENERGY INDUSTRIES

A few weeks ago, the PTO issued a first Office Action (gpboa.pdf) in which the trademark examiner rejected GREEN PATENT BLOG as ”merely descriptive” of blogs that provide information on green technology (a trademark can’t be registered with the PTO if it is a generic term or descriptive of goods or services because that would restrict competitors from conveying information about their goods or services). 

Specifically, the examiner noted that BLOG is generic for blogging services, and GREEN PATENT describes the subject matter of the blog.  The Office Action stated that GREEN describes things that involve clean technology or renewable energy, and PATENT is generic for a form of intellectual property.  Finally, the examiner attached some evidence of internet usage of “green patents” that he says shows that the term describes clean technology patents.

I will be formulating a response to the Office Action in the next week or two and will report on it once it’s filed.  But don’t worry – Green Patent Blog will fight the good fight.  I’ll go all the way to the Supreme Court if I have to.

Nichia Denied Attorney’s Fees in LED Design Suit

June 13th, 2008

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In the latest chapter of a lawsuit that has become a stark demonstration of the futility of patent litigation, Japanese LED maker Nichia lost its motion for attorney’s fees in a design patent dispute with Korean competitor Seoul Semiconductor (Seoul).  Nichia had moved for a fee award of about $2.5 million.  In February, Nichia won a Pyrrhic victory when it obtained a judgment against Seoul for $250 (the actual money damage was a paltry $62, but the statutory minimum award for design patent infringement is $250) in a case that cost both sides millions of dollars in legal fees.

Section 285 of the patent statute provides for the award of attorney’s fees to the prevailing party in “exceptional cases.”  A case may be deemed exceptional for many reasons, including where infringement is found to be willful or a party has engaged in litigation misconduct.  However, an award of attorney’s fees is discretionary, and a judge can deny attorney’s fees even in exceptional cases.

Here, despite a jury verdict that Seoul had willfully infringed four of Nichia’s LED design patents, Judge Maxine M. Chesney of the U.S. District Court in San Francisco denied attorney’s fees because Nichia’s ultimate claim for relief was based on such a small monetary loss.  Judge Chesney noted that Nichia proceeded with the litigation after its claim for inducing infringement (which, if successful, could have resulted in damages of over $4 million) was dismissed on summary judgment.

The court’s order (order.pdf) characterized Nichia’s attempt to pursue the remaining allegations of direct infringement based on only two sales in the U.S. as the use of a “sledgehammer to kill a gnat” and noted that Seoul spent about $2 million in legal fees to defend that portion of the case.

Judge Chesney also observed that the parties are engaged in other disputes in Korea and Japan and suggested that Nichia’s persistence here may have been an attempt to gain “some unstated ancillary advantage over defendants in Asia.” 

Although that may have been Nichia’s motivation, there is nothing that prevents a patent holder from pursuing a “de minimis” injury.  A patentee has the right to enforce its patent even for tiny damages amounts:  the Federal Circuit’s opinion in Embrex, Inc. v. Service Engineering Corp. held that the patentee can sue for a de minimis amount so long as the lawsuit is not “performed for amusement, to satisfy idle curiosity, or for strictly philosophical inquiry.”  The result here guaranteed one thing - no one was amused by this lawsuit.

Greenline Sues Plant Installer Over Biodiesel Processing Technology

June 12th, 2008

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Greenline Industries (Greenline), based in Larkspur, California, designs processors that convert feedstocks such as seed oils and animal fats into biodiesel fuels.  Greenline’s proprietary technology provides waterless systems to clean the fuel, allowing producers to avoid the time and money associated with introducing water into the process and later separating it out.  Greenline also enjoys an exclusive worldwide license to continuous flow technology, which greatly increases its processors’ production capacity. 

In 2006, Greenline and Arkansas engineering firm Agri-Process Innovations (API) created a venture, now called AP Fabrications (APF), for the purpose of installing Greenline biodiesel plants.  In 2007, Greenline gave up its ownership rights in the venture, and API became the sole owner of APF.

Last month Greenline sued API and APF in federal court in Oakland, California for anticipatory breach of contract, misappropriation of trade secrets, false advertising and a declaratory judgment that Greenline owns the copyrights in its processor designs.  Greenline alleges that its vendor agreement with APF provided that Greenline would be exclusively responsible for the design of biodiesel processing units while APF’s role was limited to installation of the units.  Greenline also contends that the agreement allowed API to sell the processors but required that they be marketed as “Greenline Industries” plants.

The trigger for the lawsuit was a May 5, 2008 letter in which API and APF told Greenline they were terminating the vendor agreement and demanded compensation for (unspecified) intellectual property rights created by API and used by Greenline.  Greenline alleges this repudiation of the agreement constitutes anticipatory breach of contract.  

According to the complaint, API also claims rights to Greenline’s technology through statements on its web site that API designs the processing units.  These and other statements implying ownership of the processing techniques, as well as claims of responsibility for the design of specific processing plants, form the basis for Greenline’s claims of false advertising.

While the anticipatory breach and false advertising claims seem reasonably well-founded, it’s hard to see how API/APF’s actions constitute misappropriation of trade secrets, considering that the only allegations of theft of intellectual property in the complaint are the May 5 letter and the statements on API’s web site. 

The Uniform Trade Secrets Act (upon which many state trade secrets laws are modeled) defines misappropriation as acquisition of a trade secret by someone who knows or should know it was acquired by improper means or disclosure of a trade secret that was improperly acquired.  The facts of the complaint suggest that any acquisition or disclosure of Greenline’s proprietary information by API or APF occurred pursuant to the vendor agreement, which was in force until last month.  Simply making misrepresentions of ownership of a particular proprietary technology to third parties would not seem to rise to the level of misappropriation.

The other striking thing about this dispute is the extremely short time period between API/APF’s letter to Greenline terminating the agreement (May 5, 2008) and the date Greenline filed the lawsuit (the complaint is dated May 12, 2008).  This rapid turnaround suggests either that tensions were brewing for a while or the two sides made little attempt to resolve the dispute before resorting to litigation.

The MusicPad Pro Plus: Sheetless Sheet Music for Greener Gigs

June 10th, 2008

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I received an e-mail recently from the folks at FreeHand Systems (Freehand) about the MusicPad Pro Plus (MusicPad), a patented device that can save reams of paper by electronically storing and displaying sheet music.  The MusicPad’s LCD back-lighting also obviates the need for external music stand light fixtures.

The MusicPad is covered by Freehand’s U.S. Patent No. 6,483,019 (’019 patent), which is directed to a system for displaying music including an internet server, a computer, a plurality of viewers and a plurality of styluses.  Musical compositions are downloaded from the internet (including one of FreeHand’s own web sites, which offers 98,000 digital music scores) and stored in the computer’s memory.  The computer sends the musical compositions to the viewers, which have memories to store the compositions. 

The musician reads the compositions from the viewer (shown above), which, at 13.3″ x 9.9″ x 1.8″ and weighing about four pounds, can fit on a music stand.  The stylus allows the musician, conductor or bandleader to annotate the musical composition in the viewer, and save the annotations.  Multiple annotations by different people can be overlayed and saved in the MusicPad.

The first thing I wondered was how the MusicPad “knows” when to “turn the page” of the musical composition.  There the device relies on prior art; the ’019 patent incorporates by reference U.S. Patent No. 5,760,323 (’323 patent), which discloses a display stand that can advance the pages of the composition by a hand- or foot-operated actuator, sound translation software which “hears” the musical sounds and translates them into the notes on the page, or a timed interval.

The claims and examples in the ’019 patent primarily contemplate multiple viewers displaying multiple groups of a musical composition to multiple users, with variations in the composition within and among the groups, i.e., a musical score for an orchestra.  Perhaps institutional performing groups like the philharmonic orchestras around the world might invest in MusicPads for their players.  For the average working musician, however, the $899 price tag could be prohibitive. 

At the moment, FreeHand does not appear to be marketing the MusicPad as an environmentally-friendly device.  If they do consider marketing the MusicPad as a “green” solution for musicians, they should first substantiate the device’s environmental benefits (i.e., by estimating whether the environmental gains from the paper saved by using the device would offset the impact of the energy the device uses).  But it seems that the potential is there for bringing an increasingly paperless world to the world of music.

Swift Personal Wind Turbines: The Sound of Silence

June 7th, 2008

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If you’ve always wanted to put a wind turbine on your roof but thought it would be too big or too loud, you’re not alone.  The primary challenges in adapting wind turbines for personal use have been to overcome the fact that they are too unwieldy for small buildings and generate too much noise for densely populated areas.  The new Swift turbine, developed by Scottish energy products and solutions company Renewable Devices, overcomes those obstacles with a nearly silent device that has a blade/ring diameter of only seven feet and requires only a few feet of mounting space. (see the Inhabitat story and the product specs)

Wind turbine noise comes from aerodynamic sources (i.e., the air) and mechanical sources (i.e., the turbine assembly).  In traditional wind turbine designs, air flowing along the blades and off the ends of the blades generates noise.  Additional noise can be caused by vibration of the turbine assembly during high winds and turbulent airflow common in urban areas. 

The new turbine design covered by Renewable Devices’ U.S. Patent Application Pub. No. 2006/0244264 addresses these problems in several ways.  First, the turbine has a circular diffuser (21) that rings the turbine blades.  In operation, when the airflow reaches the ends of the blades, it contacts the diffuser and proceeds in a circumferential path instead of flowing off the ends of blades.

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The Swift turbine also has a furling device (50) with tailfins (53, 54).  When the airflow exceeds a certain speed, the furling device rotates the rotor to maintain the direction of the airflow in line with the turbine’s rotational axis.  In excessively high winds, the turbine rotor can be rotated out of the airflow altogether.  These measures reduce the vibrations of the turbine assembly components. 

Finally, the Swift turbine has a mounting structure that includes a rubber core to absorb vibrations before they spread upward to the moving parts of the turbine assembly. 

So the time to put a personal wind turbine on your roof is now.  The Swift personal wind turbines, which are being manufactured by Cascade Engineering of Grand Rapids, Michigan, will be commercially available next month.