Villeneuve said that the single most important factor leading to the granting of a permanent injunction was WOSS’ continued sale of infringing products after the jury verdict.
On Tuesday, November 20th, U.S. District Judge Beth Labson Freeman of the Northern District of California entered an order regarding post-trial motions in a patent and trademark infringement case brought by Fitness Anywhere, the makers of TRX Suspension Training fitness equipment, against WOSS Enterprises. The order granted post-trial motions filed by Fitness Anywhere both for enhanced damages on the patent infringement findings as well as a permanent injunction against WOSS. This order came about one month after Judge Freeman granted a motion to reconsider, which reinstated the validity of the “crown jewel” TRX patent previously invalidated in the case.
The jury verdict entered in this case found willful infringement of the patent claims asserted by Fitness Anywhere and Judge Freeman’s recent order determined that enhanced damages for patent infringement were warranted. “Critical to this decision is WOSS’s subjective intent at the time of infringement,” Judge Freeman wrote. The only direct testimony regarding this intent came from WOSS’ founder who argued that WOSS’ Titan product didn’t infringe upon the asserted patent claims but the jury disregarded this testimony in finding willful infringement. Judge Freeman also found substantial circumstantial evidence supported enhanced damages including an admission by WOSS’ founder that the Titan equipment was developed after reviewing Fitness Anywhere’s patent and that WOSS continued selling the accused product after receiving a cease-and-desist letter in 2014. Judge Freeman awarded double damages, not the treble damages Fitness Anywhere was seeking, because of a lack of direct evidence of subject intent and other factors weighing against treble damages.
Although WOSS didn’t oppose Fitness Anywhere’s motion for permanent injunction, Judge Freeman found that the injunction was warranted even if it was opposed. WOSS’ infringement of the asserted patent claims caused irreparable harm through the erosion of TRX equipment prices. Because WOSS continued to sell infringing equipment even after the jury’s verdict in the case, no other remedies at law were available to compensate Fitness Anywhere for the harm it suffered. The balance of hardships was neutral, as the court found that WOSS hadn’t been able to stay in business and had to file for bankruptcy, but the public interest factor favored Fitness Anywhere as the public interest favors the enforcement of intellectual property rights and no exception to this general rule had been provided by WOSS.
According to Alain Villeneuve, partner at Duane Morris LLP and lead counsel representing Fitness Anywhere, Judge Freeman’s order on enhanced damages for patent infringement and the grant of a permanent injunction serves as a roadmap which Fitness Anywhere can use to vindicate its intellectual property rights against many others who are infringing on the IP behind the TRX fitness equipment. “The bottom line is that this ruling should send a strong message to small companies operating over the Internet which want to sell competing products that they should be very careful,” Villeneuve said. He added that TRX’s modus operandi wasn’t to sue without warning and that it was common practice for TRX and its CEO Randy Hetrick to work with potential infringers on greenlighting redesigned products; Judge Freeman’s recent order noted that WOSS admitted to having this kind of opportunity.
Although it wasn’t likely that Fitness Anywhere would recoup the total enhanced patent damages of more than $11 million dollars from WOSS, having recently declared bankruptcy, Villeneuve noted that this decision set an important precedent for the company. Such a ruling was very important to TRX, which has lost sales and has had to layoff employees in California because of the actions of infringing parties. Villeneuve said that the single most important factor leading to the granting of a permanent injunction was WOSS’ continued sale of infringing products after the jury verdict.
Currently there are multiple other companies who have decided to enter the market with closely related goods without doing a good job at looking at TRX’s patent portfolio, according to Villeneuve. “Randy Hetrick, the CEO, he says that going after infringers is like a game of whack-a-mole: the moment you take them down, they come back,” Villeneuve said. “Hopefully this ruling from Judge Freeman will knock some sense into some people. I hope the attorneys facing us read this ruling and decide to work collaboratively. TRX has never taken a monopolistic position in these matters.”
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Josh MaloneDecember 14, 2018 12:42 pm
Shady operator forms a shell company, identifies a hot product, floods the market with knock-offs, jams up the court system with wasteful litigation, pulls all the money out of the company, then avoids any consequences by declaring bankruptcy.