Gold Crest, LLC v. Project Light, LLC

• Decision Date: 22 March 2022
• Docket Number: 5:19-cv-2921
• Parties: GOLD CREST, LLC, PLAINTIFF, v. PROJECT LIGHT, LLC, et al., DEFENDANTS.
• Court: U.S. District Court — Northern District of Ohio

GOLD CREST, LLC, PLAINTIFF,
v.
PROJECT LIGHT, LLC, et al., DEFENDANTS.

No. 5:19-cv-2921

United States District Court, N.D. Ohio, Eastern Division

March 22, 2022

MEMORANDUM OPINION AND ORDER

HONORABLE SARA LIOI, UNITED STATES DISTRICT JUDGE

This matter is before the Court on the motion of plaintiff Gold Crest LLC (“Gold Crest”) for partial summary judgment against all defendants^[1] on the claims in its amended complaint (Doc. No. 67) for patent infringement and validity of two design patents (Doc. No. 126). Defendants Project Light, LLC (“Project Light”), Prospetto Light, LLC (“Prospetto Light”), Prospetto Lighting, LLC (“Prospetto Lighting”) (collectively, the “Corporate Defendants”), and Sam Avny (“Avny”) (collectively, “defendants”) opposed the motion (Doc. No. 128), and Gold Crest filed a reply (Doc. No. 132). With leave of Court, Gold Crest filed a supplemental brief in support of its motion for summary judgment (Doc. No. 144), defendants filed a supplemental brief in opposition (Doc. No. 150), to which Gold Crest filed a supplemental reply (Doc. No. 152).

For the reasons that follow, Gold Crest's motion for summary judgment is granted in part and denied in part.

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I. Background

A. Factual

The factual background of this action as alleged in the amended complaint has been detailed in the Court's orders ruling on the motion of Project Light to withdraw admissions (Doc. No. 109), and the motion of defendants Prospetto Light, Prospetto Lighting, and Avny to dismiss the amended complaint (Doc. No. 110). Familiarity therewith is assumed.

Briefly, Gold Crest designed the “Brooklyn LED Task Light” beginning in 2014 and, in 2016 and 2017, the United States Patent and Trademark Office (“USPTO”) granted Gold Crest two design patents for the Brooklyn LED Task Light-Design Patent No. U.S. D769, 512 (“‘512 D. Patent”) (Doc. No. 67-1) and Design Patent No. U.S. D787, 735 (“‘735 D. Patent”) (Doc. No. 67-2) (collectively, the “Design Patents”).^[2] (Doc. No. 126 at 5.^[3]) The ‘512 D. Patent was registered by the USPTO on October 16, 2016, and the ‘735 D. Patent was registered on May 23, 2017. The Design Patents depict a desk lamp with drawings, and the claim^[4] in each is for “the ornamental design for a light assembly, as shown and described.” (See Doc. Nos. 67-1, 67-2.)

Gold Crest alleges that in 2017, the Corporate Defendants displayed and offered for sale a desk lamp at the “HD Expo” in Las Vegas, Nevada that infringes the Design Patents. (See Doc. No. 67 ¶¶ 22-25.) Gold Crest claims that “[a]n ordinary observer familiar with the prior art would be deceived into thinking that the design of the infringing products was the same as” the Design

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Patents. (Id. ¶ 30.) Based upon these factual allegations, Gold Crest asserted nine claims for relief against the defendants and ten (10) John Does.^[5] Relevant here are Gold Crest's first and second claims, in which Gold Crest alleges that the Corporate Defendants directly and indirectly infringed the ‘512 D. Patent and ‘735 D. Patent, respectively, in violation of 35 U.S.C. § 271.^[6] (Id. ¶¶ 34- 54.) Gold Crest seeks injunctive relief, ^[7] monetary damages, and attorney fees. (See Id. at 25-27.)

In response to the amended complaint, defendants asserted affirmative defenses of invalidity and unenforceability of the Design Patents. (Doc. No. 89 at 10; Doc. No. 157 at 10.) Pursuant to the Court's Local Patent Rules, defendants filed their initial invalidity and enforceability contentions (“Contentions”), which are attached to Gold Crest's motion for summary judgment. (See Doc. No. 126-8.^[8])

B. Procedural

By way of procedural background, Prospetto Light, Prospetto Lighting, and Avny moved to dismiss Gold Crest's claims against them pursuant to Fed.R.Civ.P. 12(b)(6), which the Court granted in part and denied in part as to all defendants.^[9] (See Doc. No. 110.) Relevant to the instant

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motion, the Court denied the motion to dismiss as pertains to Gold Crest's claims against the Corporate Defendants for direct infringement of the Design Patents but granted the motion to dismiss Gold Crest's claims against the Corporate Defendants for indirect infringement of the Design Patents. (See id. at 32-33.) With respect to Avny, the Court denied the motion to dismiss as pertains to Gold Crest's claims for contributory and vicarious liability against Avny for direct infringement of the Design Patents but granted the motion to dismiss Gold Crest's claims for contributory and vicarious liability against Avny for indirect infringement of the Design Patents. (See id. at 33-34.)

C. Gold Crest's Motion

Gold Crest seeks summary judgment pursuant to Fed.R.Civ.P. 56 on its first and second claims for direct infringement, and the validity, of the Design Patents. (See Doc. No. 126 at 4.) Gold Crest claims that defendants' product-the “Brooklyn USB”-infringes the Design Patents because it is confusingly similar in both name and design to the “Brooklyn LED Task Light” embodied in the Design Patents (See Id. at 5-9.) In support of its motion, Gold Crest attaches the declaration of its lawyer, Konrad L. Trope (“Trope”). (Doc. No. 126-1). The purpose of Trope's declaration is to attest that various documents cited by Gold Crest in support of its motion for summary judgment are true and correct copies. (See id. at 2-3.)

In opposition, defendants dispute that the Brooklyn USB infringes the Design Patents and also argue that Gold Crest's infringement claims are unenforceable and that the Design Patents are invalid. Defendants' unenforceability argument is based upon a 2017 vendor agreement between Marriott International Design and Construction Services, Inc. (“Marriott”) and Gold Crest. (See Doc. No. 126-8 at 8; Doc. No. 128 at 1-3.) Defendants further maintain that the Design Patents

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are (1) invalid under 35 U.S.C. §§ 102 and 103, (2) invalid because the Design Patents are functional and not ornamental, or their validity is limited to the ornamental design of the Brooklyn LED Task Light exclusive of the functional components, and (3) invalid because the Design Patents do not name all inventors. (Doc. No. 126-8 at 2-8; Doc. No. 128 at 3-13.)

II. Discussion

A. Design Patents-35 U.S.C § 171

Title 35 U.S.C. § 171 governs patents for designs. Section 171(a) provides that:

Whoever invents any new, original and ornamental design for an article of manufacture may obtain a patent therefor, subject to the conditions and requirements of this title.

“‘A design patent protects the non-functional aspects of an ornamental design as seen as a whole and as shown in the patent.'” Amini Innovation Corp. v. Anthony California, Inc., 439 F.3d 1365, 1370-71 (Fed. Cir. 2006) (quoting KeyStone Retaining Wall Sys., Inc. v. Westrock, Inc., 997 F.2d 1444, 1450 (Fed. Cir. 1993)). “An aspect is functional ‘if it is essential to the use or purpose of the article or if it affects the cost or quality of the article.'” Id. at 1371 (quoting Inwood Labs., Inc. v. Ives Labs., Inc., 456 U.S. 844, 851, 102 S.Ct. 2182, 72 L.Ed.2d 606 (1982)). The drawings in the patent define the patented design. Id.

B. Summary Judgment Standard of Review

“Summary judgment is as appropriate in a patent case as in any other. Where no genuine issue of material fact remains and the movant is entitled to judgment as a matter of law, the court should utilize the salutary procedure of Fed.R.Civ.P. 56 to avoid unnecessary expense to the parties and wasteful utilization of the jury process and judicial resources.” Barmag Barmer Maschinenfabrik AG v. Murata Mach., Ltd., 731 F.2d 831, 835 (Fed. Cir. 1984). The United States

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Court of Appeals for the Federal Circuit applies the law of the regional circuit to a motion for summary judgment. Microsoft Corp. v. GeoTag, Inc., 817 F.3d 1305, 1313 (Fed. Cir. 2016) (“The review of a grant of summary judgment involves an issue not unique to patent law, so we look to the law of the regional circuit in which the district court sits.”).

Summary judgment is appropriate “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). That is, summary judgment may only be granted when no “reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

In reviewing summary judgment motions, this Court must view the evidence in a light most favorable to the non-moving party to determine whether a genuine issue of material fact exists. Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970); White v. Turfway Park Racing Ass'n, Inc., 909 F.2d 941, 943-44 (6th Cir. 1990), impliedly overruled on other grounds by Salve Regina Coll. v. Russell, 499 U.S. 225, 111 S.Ct. 1217, 113 L.Ed.2d 190 (1991). A fact is “material” only if its resolution will affect the outcome of the lawsuit. Anderson, 477 U.S. at 248.

Before addressing Gold Crest's motion for judgment that the defendants infringed the Design Patents, the Court will first address the issue of enforceability and then the issue of the validity of the Design Patents.

C. Enforceability-The Marriott Agreement

In the Contentions and in opposition to Gold Crest's claims for direct infringement of the Design Patents, defendants argue that Gold Crest lacks the right to enforce its infringement claims

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because it transferred its rights to the Design Patents to Marriott under a vendor agreement between them dated October 6, 2017 (“Agreement”). (See Doc. No. 126-8 at 8; Doc. No. 128 at 1-3.) The Agreement is attached to Gold Crest's motion. (See Doc. No. 126-2.)

The Agreement specifies the terms and conditions upon which Marriott will purchase goods and services from Gold Crest, governed by the laws of the State of New York. (See id. at 2, 13, ¶ 4.) It contains a provision whereby under...