We Care, Inc. v. Ultra-Mark Intern. CORP.
| Decision Date | 13 December 1989 |
| Docket Number | 3-89 CIV 532. |
| Citation | 741 F. Supp. 743 |
| Parties | WE CARE, INC., a South Dakota corporation, Plaintiff, v. ULTRA-MARK INTERNATIONAL CORPORATION, a Minnesota corporation; Steven E. Hemping, an individual; Marco Associates International; Bruce Gibis, an individual; Seifert Sales, Inc., a Minnesota corporation; and Lloyd A. Leirdahl, an individual, Defendants. |
| Court | U.S. District Court — District of Minnesota |
COPYRIGHT MATERIAL OMITTED
Merchant & Gould by John A. Clifford, Minneapolis, Minn., and Zarley, McKee, Thomte, Voorhees & Sease by Mark Frederiksen, Omaha, Neb., appeared on behalf of plaintiff.
Kinney & Lange, P.A. by David R. Fairbairn and Thomas J. Stueber, Minneapolis, Minn., appeared on behalf of defendants.
FINDINGS OF FACT, CONCLUSIONS OF LAW & ORDER
1. Plaintiff We Care, Inc. is a corporation organized under the laws of the State of South Dakota and has a regular and established place of business at Pierre, South Dakota.
2. Plaintiff is the assignee of U.S. Letters Patent No. 4,798,916 ("the '916 patent") duly and legally issued on January 17, 1989 for an invention entitled "Safety Plate for Electrical Outlet." The '916 patent includes eight claims, one of which is an independent claim.
3. Defendant Ultra-Mark International Corporation is a corporation organized under the laws of the State of Minnesota and had a regular and established place of business at Excelsior, Minnesota at the time of filing and service of the complaint in this action.
4. Defendant Steven E. Hemping is president of Ultra-Mark International Corporation and resided in Plymouth, Minnesota at the time of filing and service of the complaint of this action.
5. Defendant Marco Associates International is a company having a regular and established place of business at Eden Prairie, Minnesota.
6. Defendant Bruce Gibis does business as Marco Associates International and is a resident of Eden Prairie, Minnesota.
7. Defendant Seifert Sales, Inc. is a Minnesota corporation having a regular and established place of business at Eden Prairie, Minnesota.
8. Defendant Lloyd A. Leirdahl is an officer of Seifert Sales, Inc. and resides in Eden Prairie, Minnesota.
9. None of the defendants has contested service of the complaint, venue, personal jurisdiction or the jurisdiction of this court to decide this matter.
10. Plaintiff is a relatively small company formed by the two inventors of the '916 patent and the wife of one of the inventors. Except for manufacturing, plaintiff regularly conducts business out of the home of one of the inventors. The plaintiff has been manufacturing and selling the outlet covers described in the '916 patent under the name "Care Cover" since October, 1987. Currently, plaintiff markets approximately 4,000 outlet covers per month.
11. The '916 patent is directed to a childproof electrical outlet cover having a pair of slidable panels which cover the receptacles of an electrical outlet to prevent children from inserting foreign objects into the outlet. The outlet cover is also directed to energy efficiency in its use of a back plate which holds the slidable panels against the cover plate and prevents air infiltration through the outlet cover.
12. On October 19, 1987 application Serial No. 109,758, which later issued as the '916 patent, was filed with eight claims.
13. The first Office Action by the Patent Office was mailed on September 22, 1988 wherein claims 1-7 were allowed and claim 8 was rejected. Claim 8 was rejected under 35 U.S.C. § 112, first paragraph, because the Examiner could find no specific comment in the specification as to how the gasket was affixed in position on the outlet cover.
14. In response to the first action, an amendment was filed on September 27, 1988 wherein none of the claims were amended, but several typographical errors were corrected in the specification. A single sentence was added to the specification to describe the method of affixing the gasket in position on the outlet cover, as shown in the drawings.
15. In response to the amendment, the United States Patent Office allowed all of the claims in the application, without amendment to the wording of any of the claims.
16. U.S. Patent No. 4,798,916 issued on January 17, 1989.
17. In October, 1987 the plaintiff began manufacturing and marketing its invention under the name "Care Cover." The product was marketed with the notice "Patent Pending" identified on all packaging.
18. During the summer of 1988, Mr. Bruce Gibis of Marco Associates International and Mr. Lloyd Leirdahl of Seifert Sales contacted plaintiff with respect to marketing of the "Care Cover."
19. Mr. Gibis and Mr. Leirdahl introduced Mr. Hemping to plaintiff because the plaintiff did not have the financial resources necessary to develop the product for immediate mass marketing and production.
20. In a letter to plaintiff dated August 18, 1988 Mr. Hemping indicated that a company "to be named Ultra-Mark Corporation will be established to market, sell and manufacture the Care Cover product line" as outlined in his "Letter of Intent."
21. On September 1, 1988 plaintiff met with Mr. Hemping and Mr. Leirdahl, at which time Mr. Hemping was given additional samples of the Care Cover, and discussions followed with respect to the large numbers of products which would be sold.
22. Negotiations between Mr. Hemping and plaintiff continued until September 28, 1988 when Mr. Hemping wrote a letter to plaintiff terminating such negotiations. Talks continued between plaintiff and Mr. Gibis and Mr. Leirdahl.
23. Mr. Engel and Mr. Weiger, of plaintiff, spoke with Mr. Gibis and Mr. Leirdahl in late October and indicated that a patent had been allowed on the patent application which covered the invention.
24. On November 10, 1988 Mr. Gibis sent plaintiff a letter terminating negotiations with plaintiff.
25. In August, 1989 plaintiff discovered that Ultra-Mark Corporation was marketing the "Shock Block" and a complaint for patent infringement was filed soon thereafter.
26. In the prosecution of the patent application for U.S. Patent No. 4,798,916 the Examiner reviewed and considered each of the following patents:
2,477,803 Huber
2,710,382 Fitzpatrick et al
2,820,842 Meistrell
3,068,442 Kubik et al
3,222,631 Cohen
3,865,456 Dola
4,094,569 Dietz
4,293,173 Tricca
4,600,258 Hu
4,640,564 Hill
27. The defendant cites an additional patent as being pertinent: the Hoessel patent, No. 2,455,582, which shows a safety electric wall plate which includes a disk which may be rotated so as to align apertures and allow a plug to be inserted in an electrical socket.
28. Photographs of the defendants' product, along with assembled and disassembled specimens of defendants' and plaintiff's product, were presented to the court.
29. Claim 1 of the '916 patent recites the following structure, with parenthetical comments concerning the defendants' accused structure:
30. The '916 patent includes eight claims. Claim 1 of the '916 patent is an independent claim. Claims 2 through 8 are dependent claims which ultimately depend on claim 1. Plaintiff contends that claims 1, 3 and 5 are infringed.
31. The plaintiff presented evidence of...
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We Care, Inc. v. Ultra Mark Intern. Corp.
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