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Lilly wins another court battle against Teva over Alimta

California investors may have heard that a U.S. court has ruled that Lilly has intellectual property protection for the drug Alimta until 2022. The decision is the latest win for the drug manufacturer in its long-running patent battle with rival Teva over the popular lung cancer drug.

In an effort to win the right to make a generic version of Alimta, Teva launched a series of lawsuits over the validity of Lilly's patents for the drug. In 2012, a court rejected Teva's challenge to Alimta's chemical make-up. The company then sued Lilly over a method-of-use patent that covers the co-administration of Alimta with vitamin B12 and folic acid in order to protect patients from side effects of the drug, arguing that the combination was obvious. However, in an initial ruling in 2014, a judge found that combining Alimta with the nutrients was not obvious at the time the drug was developed.

Court case emphasizes importance of contractual details

In negotiating a contract, a California business owner may find that an agreement with a subsidiary of a company should also involve that entity's parent company as a party to minimize the potential for issues such as breach of contract. A recent case that reached the U.S. Court of Appeals for the 7th Circuit involved a suit against a parent company that was not a party to the actual contract in question.

The legal action occurred after the plaintiff company suffered losses because of a breach of contract by the subsidiary of the defendant. The subsidiary did not have assets that could be used to satisfy its contractual obligation, leading to the plaintiff's effort to recover its losses from the parent corporation. While the plaintiff did negotiate with the parent company to sell its business to the subsidiary, the actual contract did not include the parent. In filing the claim, the plaintiff alleged that the parent corporation was a direct participant in the matter. Further, the plaintiff suggested that the parent company was an alter ego for its subsidiary.

The importance of IP protection for startup companies

California is home to some of the nation's most innovative companies, and their success is often based largely on their intellectual property. Studies have found that intangible assets account for most of a company's value, and for businesses just starting out, such assets are often the difference between success and failure. Startup businesses often find it difficult to qualify for conventional financing, and they may also have a difficult time getting venture capitalists to back them if they have not taken adequate steps to protect their intellectual property.

When much of a fledgling company's value is based on its intellectual property, venture capitalists or angel investors will closely scrutinize patents, copyrights and trademarks for signs of legal vulnerability. One common mistake made by entrepreneurs is not including invention and proprietary information clauses in employee contracts. Investors may back out of even the most promising deals if ownership of vital intellectual property is dubious or subject to challenge.

Social media posts may be protected under copyright laws

Many businesses in California use social media to promote the products and services that they offer to customers. Although it is very common for Twitter and Facebook users to repost social media content, business owners may be able to protect their posts from redistribution. Intellectual property laws such as the Digital Millennium Copyright Act have been used to prevent social media users from passing off someone else's content as their own.

One freelance writer in Los Angeles was able to use the DMCA to protect the original jokes that she posted on her Twitter account. According to the writer, jokes that she posts on Twitter are her intellectual property, and she makes a living by writing them. She told Twitter that she did not give permission for others to repost her jokes without giving her proper credit.

Facebook prevails in IPO lawsuit

California is home to many of the world's most innovative technology companies, and investors are often eager to purchase shares when a Silicon Valley icon holds an initial public offering. Facebook grew from humble beginnings to become a social media giant, and its May 2012 IPO saw the firm's market value surge to over $100 billion. Facebook was the biggest IPO in Internet history, but some investors soon soured on the Menlo Park company.

The earnings posted by Facebook disappointed many analysts, and the company's stock price fell from its IPO price of $38 to just $17.55 by early September. A group of investors unhappy with the performance of their shares filed a lawsuit against Facebook and several of its senior executives as well as a number of financial companies involved in the IPO. The business litigation claimed that the social media giant had deceived investors by not divulging the impact that the use of mobile devices such as tablet computers and cellphones would likely have on the company's revenue.

Netflix involved in intellectual property dispute with Rovi

California residents may be interested to learn about the ongoing intellectual property dispute between Netflix, Inc. and Rovi Corporation. According to a statement from Rovi, the company will continue to pursue its claims against Netflix until it is able to obtain the necessary licenses. The litigation involves five patents that are related to various aspects of Netflix's over-the-top video service.

A judge issued a ruling in favor of Netflix on July 15. In her ruling, the judge granted Netflix its motion for summary judgment on the five patents in question. The judge found that the five patents were not valid because they did not cover subject matter that is patentable, according to the 2014 Supreme Court ruling in Alice Corp. Pty. Ltd. v. CLS Bank International. Part of the judge's decision also included a claim construction ruling that was in favor of Rovi.

Amazon facing lawsuit over search results

A California court will hear a trademark infringement lawsuit that was filed against Amazon by a watch manufacturer that does not sell its products through the online shopping website. Multi Time Machine, a company that produces military-style timepieces, takes issue with the way that Amazon displays search results when consumers search for MTM products on Amazon.

The trademark infringement lawsuit involves the way that Amazon allegedly confuses customers who are looking for MTM products on its website. MTM says that when consumers search for MTM watches on Amazon, they are provided with a list of competitor's watches rather than a message informing them that Amazon does not carry MTM watches. According to MTM, these search results could cause customers to purchase watches from other manufacturers rather than continue to look for MTM watches.

Trump and NBC agree to arbitration over Miss USA dispute

California residents will likely be aware that remarks made by Donald Trump considered incendiary by many have led to several companies severing ties with the polarizing candidate for the GOP presidential nomination. Disparaging comments about Mexican illegal immigrants led NBC to terminate its relationship with Trump on June 29, and the Spanish television channel Univision announced that it was cancelling its coverage of the Miss USA beauty pageant. Trump owns the pageant jointly with NBCUniversal.

Trump reacted angrily to the news, and his attorneys filed a $500 million lawsuit against Univision on June 30. However, an arbitration clause in his contract with NBC has prevented him from taking legal action against that network. Attorneys representing Trump said that the network had violated the terms of its contract with the real estate developer, but they added that both parties had agreed to arbitration. Arbitration clauses avoid the publicity of business litigation by requiring parties to allow an independent arbitrator to settle disputes privately.

An overview of intellectual property protection and rights

Entrepreneurs, artists, and others in California may understand the frustration of having one's creative work copied, especially if the individual or entity doing the copying then uses that material to generate a profit. It is important to know the types of protections available so that violations are clearly understood. In some cases, legal action may be necessary to put an end to illicit use of one's materials, but this may be contingent on correctly protecting those materials in the first place.

There are various types of intellectual property to consider. For example, when one's literary or artistic work is created in a fixed form like a computer file or in print, it can be considered as copyrighted. Computer software falls into this category. An individual may use the copyright symbol with such work, and they can expect the protection to last for a certain number of years after their death. In some cases, a longer period of coverage might be allowed based on the country in which the creator resides.

Sony unsuccessful in effort to have data breach lawsuit dismissed

A federal judge in California has rejected the request of Sony Pictures Entertainment Inc. to have a suit filed by soem of its former employees dismissed. The legal action relates to the November 2014 data breach that occurred as the company prepared to release a controversial movie "The Interview". It is believed that the responsibility for data theft lies with North Korea, prompted by the nature of the film which was based on the fictional death of that nation's leader.

The primary allegation in this business litigation is that the company failed to protect the personal information of employees. Sony informed employees by letter of the potential theft of identification information from passports, Social Security details and driver's licenses. It is also possible that financial and health information was compromised during the breach. The allegation of negligence was not tossed out, but the judge has dismissed some other claims, including alleged breach of contract on the part of Sony. Employees have indicated that the company failed to strengthen the security system due to the costs in spite of prior hacking actions. However, the judge indicated that proof of this claim wasn't necessary for the suit to continue forward.

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Klein & Wilson
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