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9 January 2013Patents

Nike hit with FuelBand infringement claims

Nike is the third brand owner in three months to be sued by fitness company Sportbrain, which claims the multinational’s FuelBand product infringes one of its patents.

Sportbrain, a Texas-incorporated business that seemingly stopped operating more than 10 years ago, filed the suit at the US District Court for the Eastern District of Texas on January 2. The company wants a jury trial, and has demanded an injunction and monetary damages.

Nike’s FuelBand product is an electronic bracelet that tracks personal fitness information. In the suit, Sportbrain alleges that Nike “intentionally induced and continues to induce infringement of one or more claims” of the patent in the US. Nike has not responded to a request for comment.

Sportbrain’s US patent, approved in November 2008, protects a method for “integrating personal data capturing functionality into a portable computing device and a wireless communication device”, according to the application.

The company used to sell similar personal fitness devices to Nike’s FuelBand, including ones that clipped to people’s belts, but went out of business in 2001.

In November last year Sportbrain filed two separate lawsuits in the same Texas court against Adidas and fitness company Fitbit, alleging that they both infringed the same patent as Nike. The litigation is continuing.

The eastern district of Texas is a popular destination to file patent lawsuits because of its special rules allowing it to expedite patent infringement cases, according to David Elkins, head of Squire Sanders’ IP group.

“Studies show that the success rate for plaintiffs is much higher than the national average—from 1995 to 2011 it was about 56 per cent, compared with the national average rate of 32 per cent.”

He said the court is especially popular with non-practising entities, which are those that license their patents but do not sell products covered by the patents.

“Whether Sportbrain is a non-practising entity is not clear. It may have determined that competition against larger companies like Nike and Adidas was too difficult but that those companies are using its technology and should pay to license it,” he added.

Cases can be transferred when a defendant can show that the dispute can be better litigated in a different district.

Elkins said: “Nike is an Oregon company. If SportBrain cannot establish bona fide ties to Texas beyond its place of incorporation, it would not be surprising if Nike sought to transfer the case to Oregon.”

Attorneys Gillam & Smith LLP and Heninger Garrison Davis LLC are representing Sportbrain.

The lawsuit is available  here.

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