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Conditioned Ocular Enhancement, Inc. v. Bonaventura

October 17, 2006

CONDITIONED OCULAR ENHANCEMENT, INC. AND FASTTRACK BASEBALL CORP., PLAINTIFFS,
v.
MICHAEL BONAVENTURA, JILL BONAVENTURA, CRAIG HALLGREN, THOMAS DAVIDSON, AND CHI-TOWN EXPRESS, DEFENDANTS.



The opinion of the court was delivered by: Judge James B. Zagel

MEMORANDUM OPINION AND ORDER

I. BACKGROUND

This case arises out of Defendant Michael Bonaventura's assignment of United States

Patent No. 6,447,408 (the "'408 Patent") to Plaintiff Conditioned Ocular Enhancement, Inc. ("COE"). Upon learning that Defendant Thomas Davidson ("Davidson") was providing vision training services that COE believed to be the patented Ocular Enhancement Training System, COE brought an action for infringement of the '408 Patent against Davidson.*fn1 In particular, COE alleges that Davidson was providing patented vision training services to Defendant Chi-Town Express. The complaint also alleges violations of the Lanham Act, 15 U.S.C. § 1125 (2000).*fn2 In response, Davidson filed several counterclaims. The first two counterclaims allege that the '408 Patent is invalid and unenforceable and that Davidson is a co-inventor and co-owner of the '408 Patent. COE previously filed a motion to dismiss these two counterclaims. At a hearing on October 18, 2005, I denied COE's motion to dismiss Counterclaims I and II. On November 30, 2005, Davidson added five additional counterclaims, each based on seven cease and desist letters (the "Letters") that COE sent to entities that Davidson claims are his current and prospective customers. COE's law firm sent the Letters between July 22, 2005, and August 15, 2005. The Letters identified COE as the owner of the '408 Patent, announced that Thomas Davidson did not have a license to use the patented system, informed the recipient of the pendency of a patent infringement lawsuit against Davidson, included a subpoena for documents relating to the suit, and directed the recipient to cease and desist all use and advertising of the COE system.

II. PROCEDURAL POSTURE

Before me is COE's motion to dismiss Counterclaims III -- VII for "failure to state a claim upon which relief may be granted." Fed. R. Civ. P. 12(b)(6). In addition, COE asks me to reconsider my October 18, 2005 ruling denying COE's motion to dismiss Counterclaims I and II.*fn3 That request is denied. "Motions for reconsideration serve a limited function: to correct manifest errors of law or fact or to present newly discovered evidence." Caisse Nationale de Credit Agricole v. CBI Indus., Inc., 90 F.3d 1264, 1269 (7th Cir. 1996). "Reconsideration is not an appropriate forum for rehashing previously rejected arguments." Id.at 1270. COE fails to offer any additional arguments in support of its challenges to Counterclaims I and II. Since COE's request for reconsideration amounts to nothing more than "rehashing previously rejected arguments," it is denied.

In responding to COE's Motion to Dismiss, Davidson withdraws Counterclaim VII and narrows Counterclaim VI, his tortious interference with economic damage claim, to include only prospective economic advantage. Thus, Counterclaim VII and the portion of Counterclaim VI concerning tortious interference with present economic advantage are dismissed.

In addition to these changes, Davidson has submitted amendments to his other counterclaims. Davidson submits the Proposed Fifth Amended Counterclaims "for clarity purposes" and "in view of Plaintiffs' Motion to Dismiss." Thus, by Davidson's own admission, the newly-amended counterclaims are purposely responsive to, and appear tailored to address, COE's critiques.*fn4 Since the proposed amended counterclaims raise no fresh legal arguments, Davidson's request for leave to file his Proposed Fifth Amended Counterclaims is denied.

III. DISCUSSION

A. Standard of Review

COE moves to dismiss Davidson's Fourth Amended Counterclaims pursuant to Fed. R. Civ. P. 12(b)(6). A motion to dismiss tests the sufficiency of a claim, not the merits of the case. Autry v. Northwest Premium Servs., Inc., 144 F.3d 1037, 1039 (7th Cir. 1998). I should grant COE's motion only if Davidson cannot prove any set of facts in support of his counterclaims that would entitle him to relief. Conley v. Gibson, 355 U.S. 41, 45-46 (1957). In reviewing COE's motion, I must construe all allegations in the counterclaims in the light most favorable to Davidson and accept all well-pleaded facts and allegations as true. See Bontkowski v. First Nat'l Bank of Cicero, 998 F.2d 459, 461 (7th Cir. 1993). I may only grant COE's motion if "no relief could be granted under any set of facts that could be proved consistent with the allegations." Hishon v. King & Spalding, 467 U.S. 69, 73 (1984).

Initially, COE argues that Davidson's counterclaims should be dismissed because (1) as a patent holder, COE has the right to enforce the '408 Patent via cease and desist letters; (2) the Letters are protected by the absolute litigation privilege; and (3) they suffer from deficient pleading. In addition to these overarching reasons for dismissal, COE also attacks each counterclaim individually. I will address COE's broad arguments first, and then will turn to each of the counterclaim-specific arguments.

B. COE's Right to Enforce its Patent

COE first argues that as the holder of the '408 Patent, it is entitled to enforce its patent, and that therefore, the counterclaims -- each of which is based solely upon the Letters -- should be dismissed. The '408 Patent carries a presumption of validity. 35 U.S.C. § 282 (2000). As the holder of the '408 Patent, COE has the right to "enforce its patent, and that includes threatening alleged infringers with suit." Concrete Unlimited, Inc., v. Cementcraft, Inc., 776 F.2d 1537, 1539 (Fed. Cir. 1985). If the patentee acts in bad faith, however, "the protection otherwise afforded by the patent laws to a patentee's conduct in enforcing its patent may be lost." Zenith Elecs. Corp. v. Exzec, Inc., 182 F.3d 1340, 1343 (Fed. Cir. 1999). Thus, a ...


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