26 IPL Newsl. 1 (2007-2008)

handle is hein.journals/iprolane26 and id is 1 raw text is: 









A Publication of The ABA Section of Intellectual Property Law  www.abanet.org/intelprop
                                                                               Volume 26, Number 1: Fall 2007


MGE UPS Systems, Inc. v. Titan
Specialized Services, Inc.
The Largest Recorded Copyright
Contempt Judgment and Its Effect
on IP Law
STEPHEN A. KENNEDY AND ZACHARY GROOVER
n today's global market economy, copyright infringement
  is growing at an exponential rate. In the recent case of
  MGE UPS Systems, Inc. v. Titan Specialized Services, Inc.,
the court found that the defendant's continued infringement
and violation of a preliminary injunction aimed at stopping
the infringement was worthy of the largest recorded contempt
sanction in copyright history.' The federal court entered a
judgment that ultimately awarded the plaintiff nearly $27 mil-
lion in fines. This article discusses: (1) the findings and hold-
ing of this potentially landmark case; (2) issues concerning
preliminary injunctions and civil contempt sanctions; and
(3) MGE's impact on the future of intellectual property law.

Findings and Holding of MGE
In MGE, the plaintiff was MGE UPS Systems, Inc. (MGE),
one of America's leading developers, manufacturers, and
servicers of uninterruptible power supply (UPS) equipment.
A UPS device provides uninterrupted power to protect elec-
tronic equipment from damages and interruptions that may
result from fluctuations in power or power loss. Many hos-
pitals, corporations, and utility companies across the United
States rely on UPS devices manufactured by MGE to ensure
that their businesses continue to run during power problems.
   Due to the nature of UPS devices, regular preventive
maintenance is necessary to ensure that they are functioning
properly and will perform as needed in the event of a power
loss. In the past, a trained field service engineer was
required to make several on-site visits each year to manually
service the devices. For such manual service, the field ser-
vice engineer would typically open the UPS, take measure-
ments, and make adjustments with hand tools. This process
was both time consuming-routine service could take three
to six hours or more to complete-and dangerous.
   Recognizing the need for greater safety and efficiency
                         as         continued on page 4)


The 2007 Patent Reform Act:
Venue Rules Come Full Circle
C. ERIK HAWES AND AUDREY CUMMING
or the past several decades, choosing a venue for a patent
    infringement lawsuit was often comparable to other mar-
    ket choices-the options were many and varied. Indeed,
based on the reputations of, and statistical evidence for, U.S.
district courts, a variety of factors could typically be considered
in choosing a venue: speed of adjudication, likelihood of trans-
fer, sophistication of judges, sympathy of jurors, likelihood of
summary judgment, size of damage awards, and the conve-
nience of witnesses and parties. The free-market venue envi-
ronment enabled plaintiffs to gravitate towards certain brand-
name districts. Currently, of the ninety-four federal judicial
districts, ten account for half of all patent cases, with the top
five districts carrying 36 percent of the caseload.'
   In large part because of concerns about forum shopping
by patent owners, Congress is currently considering sweep-
ing changes to the venue rules for patent disputes. Both the
Senate and House versions of the 2007 Patent Reform Act
contain new provisions designed to sharply limit, in certain
                                  (continued on page 8)

Strategic Responses to the Newly
Issued USPTO Continuation and
Claim Limitation Rules
JAMES G. MCEWEN
I. Background
Under prior U.S. Patent and Trademark Office (USPTO) rules,
an applicant was entitled to file as many continuation applica-
tions as needed to ensure that the invention was properly
claimed and to prevent inadvertently narrow limitations from
precluding literal infringement. The only limitation on the
number of continuations was generally set by matters of
equity' or where an applicant was not attempting to advance
prosecution by amending the claims.2 The applicant could also
attempt to ensure such coverage using a single application
which included as many claims as needed. The limitation on
the number of claims in a single application was essentially set
by the Examiner, who could issue a restriction if the number
                                 (continued on page 24)


3      State of                   Patent Reform                    12p Group               i Recent
       the Saction         3      and Infringement                 News                      Developments
                         3        Damages                                                    in Intellectual
                                                                                             Property Law

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