In re Dippin' Patent Litigation

• Decision Date: 31 March 2003
• Docket Number: No. CIV.A. 1:00CV907TWT.,CIV.A. 1:00CV907TWT.
• Citation: 249 F.Supp.2d 1346
• Parties: In Re: DIPPIN' DOTS PATENT LITIGATION
• Court: U.S. District Court — Northern District of Georgia

249 F.Supp.2d 1346

In Re: DIPPIN' DOTS PATENT LITIGATION

No. CIV.A. 1:00CV907TWT.

United States District Court, N.D. Georgia, Atlanta Division.

March 31, 2003.

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Christopher Scott Anulewicz, Meadows Ichter & Bowers, Atlanta, GA, for counterdefendant, plaintiff.

Robert R. Baron, Jr., Ballard Spahr Andrews & Ingersoll, Philadelphia, PA, for counterclaimant, defendant.

Michael J. Bowers, Meadows Ichter & Bowers, Atlanta, GA, for counterdefendant, plaintiff.

Lawrence S. Burnat, Schreeder Wheeler & Flint, Atlanta, GA, for counterclaimant, defendant.

Steven Cooper, Anderson Kill & Olick, New York, NY, for counterclaimant, defendant.

David A. Einhorn, Anderson Kill & Olick, New York, NY, for counterclaimant, defendant.

Thomas D. Flanigan, Stockwell Law Offices, Lexington, KY, for plaintiff.

John Philip Fry, Alston & Bird, Atlanta, GA, for counterclaimant, defendant.

Dan Robert Gresham, Thomas Kayden Horstemeyer & Risley, Atlanta, GA, for counterdefendant, plaintiff.

Daniel Healy, Anderson Kill & Olick, New York, NY, for counterclaimant, defendant.

D. Scott Hemingway, Storm & Hemingway, Dallas, TX, for counterdefendant, plaintiff.

Elizabeth R. Kessler, Stockwell & Associates, Lexington, KY, for counterdefendant, plaintiff.

Cynthia Jeannette Lee, Thomas Kayden Horstemeyer & Risley, Atlanta, GA, for counterdefendant, plaintiff.

Benjamin A. Levin, Ballard Spahr Andrews & Ingersoll, Voorhees, NJ, for counterclaimant, defendant.

Daniel Ross McClure, Thomas Kayden Horstemeyer & Risley, Atlanta, GA, for counterdefendant, plaintiff.

Richard S. Morrison, Ballard Spahr Andrews & Ingersoll, Voorhees, NJ, for counterclaimant, defendant.

Frank Garrett Smith, III, Alston & Bird, Atlanta, GA, for counterclaimant, defendant.

Lynn C. Stewart, Schreeder Wheeler & Flint, Atlanta, GA, for counterclaimant, defendant.

Todd E. Stockwell, Stockwell & Associates, Lexington, KY, for counterdefendant, plaintiff.

Julia Carole Thompson, Schreeder Wheeler & Flint, Atlanta, GA, for counterclaimant, defendant.

ORDER

THRASH, District Judge.

These are related actions brought by the Plaintiffs for patent infringement pursuant to the Patent Act, (35 U.S.C. § 100 et seq.), trade dress and trademark infringement pursuant to the Lanham Act, (15 U.S.C. § 1125), alleged violations of the Uniform Trade Secrets Act (18 U.S.C. § 1905), and breach of contract. The Defendants seek a declaratory judgment that the patent in question is invalid and unenforceable. The actions are pending in this Court for consolidated pretrial proceedings pursuant to 28 U.S.C. § 1407. They are before this Court on multiple motions for summary judgment filed by all parties. The manufacturers and distributors of a flash frozen ice cream known as Frosty Bites, referred to herein as the Defendants, filed the following motions for summary judgment: (1) Motion for Summary Judgment on Invalidity of U.S. Patent No. 5,126,156 [L00-C907 Doc. No. 245; L01-CV-262 Doc. No. 662; L01-CV-357 Doc. No. 308; L01-C202 Doc. No. 185], (2) Motion for Summary Judgment on Non-infringement of U.S. Patent No. 5,126,156 [L00-CV-907 Doc. No. 246; 1-.01-CV-262 Doc. No. 663; 1:01-CV-357 Doc. No. 309; 1:01-CV-202 Doc. No. 186], (3) Motion for Summary Judgment on Unenforceability of U.S. Patent No. 5,126,156 [1:00-CV-907 Doc. No. 247; 1:01-CV-262 Doc. No. 664; 1:01-CV-357 Doc. No. 310; 1:01-CV-202 Doc. No. 187], (4) Motion for Summary Judgment on Plaintiffs Violation of the Uniform Trade Secrets Act and Breach of Contract Claims [1:00-CV-907 Doc. No. 248; 1:01-CV-262 Doc. No. 665; L01-CV-357 Doc. No. 311; 1:01-CV-202 Doc. No. 188]; (5) Motion for Summary Judgment on Plaintiffs Trade Dress Infringement Claims [1:00-CV-907 Doc. No. 249; 1:01-CV-262 Doc. No. 666; 1:01-CV-357 Doc. No. 312; 1.-01-CV-202 Doc. No. 189].

Dippin' Dots, Inc. and Curt Jones, referred to herein as the Plaintiffs, filed the following Motions for Summary Judgment: (1) Motion for Summary Judgment of No Antitrust Violation for DDI's Enforcement of Patent Rights, [1:00-CV-907 Doc. No. 250; 1:01-CV-262 Doc. No. 667; 1:01-C357 Doc. No. 315; 1:01-CV-202 Doc. No. 190]; (2) Motion for Summary Judgment for Breach of Contract, [1:01-CV-357 Doc. No. 313]; Motion for Summary Judgment of Trademark Infringement and Lanham Act Violations, [1:01-CV-357 Doc. No. 314]. For the reasons set forth below, Defendants' motions are granted in part and denied in part, and Plaintiffs' motions are granted in part and denied in part.

BACKGROUND

This action was filed by Plaintiffs Dippin' Dots, Inc. ("Dippin' Dots"), and its founder, Curt Jones ("Jones"). Dippin' Dots is an Illinois corporation with its principal place of business in Paducah, Kentucky. Dippin' Dots is engaged in the business of manufacturing and distributing flash frozen novelty ice cream. The Defendants in this action are corporations and individuals engaged in either the manufacture or distribution of a competing flash frozen novelty ice cream product known as Frosty Bites.

Jones, the Dippin' Dots founder, applied for and received a patent for the method Dippin' Dots uses to make flash frozen ice cream. (Def.'s Ex. 34, United States Patent No. 5,126,156 ("the '156 patent").) Jones first began working with methods to produce flash frozen novelty ice cream in 1987. (Declaration of Curt Jones, 112.) In June of 1987 he started keeping notebooks on his progress. (Def.'s Ex. 44 Vol. I at DDI 10005.) These notebooks track Jones' progress with making flash frozen ice cream, business and marketing ideas, as well as contacts for investment and distribution. (Def.'s Ex. 44 Vol. I—IV.)

According to his notebooks, Jones was successful in making a flash frozen ice cream product in June of 1987. The product consisted of frozen beads and nuggets produced by streaming and dripping an ice cream mixture into liquid nitrogen. (Deposition of Curt Jones at 444.) On June 17, 1987, Jones served between fifty and one hundred cups of this product to the public at a picnic sponsored by Alltech, his employer at that time. (Id.) Jones did not place any of the people at this company picnic under a confidentiality agreement, and he does not recall ever telling them the product was experimental. (Jones Dep. at 448, 489.)

Later on in July, Jones' work led to an ice cream product consisting of one hundred percent beads of flash frozen ice cream, which were free flowing when served. (Id. at DDI 10056-57; Dep. of Curt Jones at 490-504). Jones served his free flowing flash frozen ice cream beads to officials of the Festival Market, a retail development, on July 13, 1987. Jones noted that the officials were potential investors in his product, and that the Festival Market could provide an outlet for selling his new ice cream. (Def.'s Ex. 44 Vol. I at DDI 10056-57; Jones Dep. at 497-500.) Some of the people at this meeting took samples of Jones' product with them and did not consume the ice cream in Jones' presence. Jones told them to wait ten to fifteen minutes before eating the product. (Jones Dep. at 504-05.) These individuals were not placed under a confidentiality agreement. (Jones Dep. at 497.)

Jones also took his completely beaded product to Rally's, a fast food chain, and to International Desserts. There, Jones allowed people from the establishments to sample his free flowing ice cream beads. (Def.'s Ex. 44 Vol. I at DDI 10137; Jones Dep. at 668-69.) Jones would sometimes leave his product at Rally's for further service after he left. (Jones Dep. at 662.) Jones does not recall placing anyone at Rally's or International Desserts under a confidentiality agreement, and he does not recall informing them that the product was experimental. (Jones Dep. at 669.)

As contemplated, the Festival Market did provide an outlet for Jones' ice cream. Jones sold a flash frozen, free flowing ice cream product there in August and September of 1987. (Jones Dep. at 535-39.) This product differed, however, from what he took to Rally's, International Desserts, and what he originally presented to the officials of the Festival Market. Jones made this product by dripping and streaming his ice cream mixture into liquid nitrogen. (Id. at 536.) This process resulted in a frozen nugget-like ice cream as opposed to a completely beaded product. (Id. at 536, 539.) The product was similar to what he served at the Alltech picnic in June of 1987. Jones gave small samples of his Festival Market product to the public, and then sold the product in larger quantities. (Id. at 558.) Jones considered the Festival Market to be a test-market for the flash frozen ice cream, and he informed his Festival Market patrons accordingly. (Jones Dep. at 547, 552.) No one, however, was placed under a confidentiality agreement. (Id. at 552). Though Jones did not make a profit from his Festival Market sales, he was encouraged by the results. (Id at 547, 559.)

The freezing agent used in flash freezing ice cream, liquid nitrogen, has a temperature of 320 below zero Fahrenheit. (Jones Dep. at 457.) Jones knew that the flash frozen ice cream was too cold to be consumed right after it was made or removed from the cooler used for transport. If consumed while too cold, the product would burn the mouth of the person eating the ice cream. (Jones Dep. at 501.) Accordingly, Jones advised those to whom he served his product to warm it before consumption. (Def.'s Ex. 44 Vol. I at DDI 10057.) When he served his ice cream at his company picnic in July of 1987, and at the Festival Market in August and September of that year, Jones did not know the specific temperature range to which the ice cream should be warmed. To prevent burning, he simply did not serve the ice cream until it stopped "smoking" or would tell people not to consume it until the "smoking" stopped. (Jones Dep. at 450-51, 485, 549, 555.) Jones believed that at the time the ice...