United States District Court, N.D. Illinois, Eastern Division
KOLCRAFT ENTERPRISES, INC. Plaintiff,
CHICCO USA, INC. d/b/a ARTSANA USA INC., Defendant. Model Exh. Description Images
MEMORANDUM OPINION AND ORDER
HONORABLE EDMOND E. CHANG UNITED STATES DISTRICT JUDGE
Kolcraft Enterprises owns United States Patent No. 7, 376,
993 (the '993 Patent), which covers methods and
apparatuses related to infant play gyms. Kolcraft accused
Artsana USA, Inc. of infringing this patent with its own line
of infant play gyms. After many years of litigation,
including before the Patent & Trademark Office, the
parties took the case to trial in August 2018. The jury
returned a verdict in favor of Kolcraft on all claims and
awarded $3, 245, 213.10 in damages. Artsana now moves for
judgment as a matter of law, or, in the alternative, a new
trial. For its part, Kolcraft moves for a permanent
injunction, prejudgment interest, enhanced damages,
attorneys' fees, and post-judgment interest. For the
reasons explained below, Artsana is denied judgment as a
matter of law. The Court also denies Artsana's motion for
a new trial, but the motion does present a very close
question on whether to remit the damages award. Ultimately,
the Court concludes no. Kolcraft's motions for a
permanent injunction, prejudgment interest, and post-judgment
interest are all granted. But the Court denies Kolcraft's
motions for enhanced damages and attorneys' fees.
The '993 Patent
a manufacturer of baby products, began developing its
Travelin' Tot play gym and play-yard product in October
2001. Trial Tr. at 150:21-151:3. To state the obvious (at
least to parents), play gyms are arches from which toys
dangle. R. 438.6, '993 Patent col. 1 ll. 53-62. Two
Kolcraft employees-Pete Myers and Joe Sejnowski-were
initially tasked with designing the product. Trial Tr. at
151:19-23. According to Kolcraft's President and CEO, Tom
Koltun, Myers came up with the idea to give the play gym four
legs that were all connected to a central hub, which allowed
the user to fold the legs down and place the play gym into a
carry bag for easy transportation. Id. at 153:6-16.
The play gym could also be connected to a play yard, a play
mat, or a bassinet, which was a unique combination of
features in the market. Id. at 154:1-9. Kolcraft
used a Chinese manufacturer, Lerado, to manufacture the
product. Id. at 186:18-23. The Travelin' Tot
launched in December 2002. Id. at 153:22-25.
on, Kolcraft decided to pursue a patent for the Travelin'
Tot product and filed an application in May 2003.
Id. at 155:6-24, 156:9-11. The application listed
both Myers and Sejnowski as inventors. Id. at
157:7-18. Kolcraft added the words “patent
pending” to the product's packaging, id.
at 158:14-18, although the '993 patent did not issue
until May 2008, id. at 156:12-13. But by that point,
Kolcraft had pulled the Travelin' Tot product from the
market. Id. at 158:11-13.
'993 patent included 31 claims, although only Claims
28-31 and Claim 20 are at issue in this case. Claim 28
describes a method for using the play gym, specifically:
securing a play gym at least partially above at least one of
a bassinet and a play yard;
removing the play gym from at least one of the bassinet and
the play yard;
securing the play gym to a mat apart from the play gym and
removing the play gym from the mat; and
collapsing the play gym, wherein collapsing the play gym
pulling a leg of the play gym in a direction away from a hub;
pivoting the leg into a stored position.
'993 Patent col. 10 ll. 6-18. Claims 29-31 depend on
Claim 28, and describe specific methods of collapsing the
play gym for storage. Id. col. 10 ll. 19-27.
20, on the other hand, describes an apparatus (rather than a
an apparatus comprising
a floor mat;
a play gym to suspend an object above the floor mat;
at least one connector to couple the play gym to the floor
at least one fastener to couple the floor mat to at least one
of a play yard and a bassinet,
wherein the at least one connector comprises a plurality of
connectors, and the play gym comprises:
a hub; and
at least two legs, each of the legs having a first end
coupled to the hub and a second end dimensioned to be
removably coupled to a respective one of the connectors,
wherein the at least two legs are pivotably coupled to the
wherein the connectors are pivotably coupled to the mat.
R. 247, Def. Claim 20 Claim Const. Br. at 3.
Artsana's Original Lullaby Play Gym
2003, a rival manufacturer of baby products, Artsana (doing
business as Chicco at the time), decided to look into
designing and producing its own play yard. Trial Tr. at
502:3-503:1. It reached out to Lerado for help because Mark
Messner, the Vice President of Marketing and Product
Development at Chicco, id. at 499:23-25, had
previously worked with the company on various stroller
designs for Chicco, id. at 504:7-10. Messner was
aware that Lerado was designing products for other companies
at the time. Id. at 505:4-14. After Messner reached
out, Lerado employees showed him a design for a play yard
that he believed to have been created by Lerado. Id.
at 505:15-20. The Lerado employees referred to the design as
an “open item, ” which, to Messner, meant any
customer who wanted to use the design could purchase it.
Id. at 505:15-20, 506:18-25. Artsana first started
selling its play yard-the Lullaby-in 2005. Id. at
parties dispute when Kolcraft first notified Artsana that it
believed the Lullaby was infringing the '993 patent.
Artsana asserts that it was first notified when Kolcraft
served its Complaint in June 2009. Trial Tr. at
507:8-22. Kolcraft, on the other hand, put forth evidence
that Kolcraft CEO Tom Koltun called Artsana's CEO, Greg
Mansker, several months before the lawsuit was filed-in March
or early April 2009-to give him a “heads up” that
Kolcraft believed that the Lullaby was infringing the patent.
Id. at 159:13-161:15. Koltun testified that he told
Mansker he should look into licensing the product from
Kolcraft. Id. at 169:1-10. According to Koltun,
Mansker eventually called him back and told him Artsana's
lawyers advised against licensing, but also that he wanted to
avoid litigation. Id. at 168:2-169:10. Koltun
testified that, after that conversation, he felt like he had
no choice but to sue Artsana. Id. at 169:11-13.
The 2009 Lawsuit and Fallout
sued both Artsana and Graco (another manufacturer of baby
products) for patent infringement in June 2009. R. 1, Compl.
Koltun explained at trial that Kolcraft discovered
Graco's infringing product, Baby Einstein, after it began
investigating the market for similar products following his
conversation with Koltun. Trial Tr. at 170:12-23. The
Complaint initially accused Artsana of infringing claims 1-12
and 18-21, while it accused Graco of infringing claims 22 and
23. Compl. ¶¶ 8, 9. Shortly after the suit was
filed, Kolcraft and Graco settled and negotiated a license
for the '993 patent, which included a 5% royalty on the
allegedly infringing Baby Einstein product. Trial Tr. at
171:8-18. Artsana, on the other hand, requested that the
Patent & Trademark Office (PTO) reexamine the validity of
Kolcraft's patent, which delayed the litigation between
the parties. Id. at 177:19-23. The Court detailed
the lengthy procedural history of the reexamination process
in the first claim construction opinion. R. 216, 9/2/16 Claim
Const. Order at 2-4. To summarize, the Patent Trial and
Appeal Board eventually affirmed the patentability of Claims
28-31 and Kolcraft amended Claim 20 to be an independent
claim. Id. In April 2012, Kolcraft issued its
Initial Infringement Contentions in this case, alleging that
in addition to the claims originally asserted in its
Complaint, Artsana had also infringed Claims 28-31.
Id. at 3.
same time as the PTO was reexamining the '993 patent,
Artsana made several changes to the “Original
Design” of the Lullaby product, purportedly to avoid
infringing the '993 patent. These changes are described
and depicted below:
PTX-7 includes a hub and four legs. The legs are
coupled to the hub via a securing pin. The leg
connects to the floor mat via the opposite end. The
top side of the floor mat includes fabric pockets
that each receive a separate leg. The leg is
secured via a snap connection.
R. 301, Def.'s SOF ¶¶ 8-10
DTX-296 includes a hub and four legs. It includes
the same hub that was used in PTX-7, meaning the
legs are coupled to the hub via a securing pin.
This redesign replaced the snap connectors with
hook and latch fasteners. It also replaced the
fabric pockets with D-rings held within the folds
of fabric straps. The legs connect to the mat by
passing the hook and loop fastener on the end of
the leg through the opening of the D-ring and
folding the leg's fastener back upon itself.
Id. ¶¶ 15-17
PTX-8 and PTX-9 have a redesigned hub that
eliminated the securing pin used in earlier
designs. The legs can be removed from then locked
position in the hub but remain attached through
tethers between the sleeves encasing the legs and
the bottom of the hub. It incorporated the same
type of connection between the legs and the mat as
Id. ¶¶ 20-26
these changes, Kolcraft proceeded with the litigation and the
case eventually went to trial in the fall of 2018. Kolcraft
argued at trial that the original Lullaby design, as well as
all of the redesigns, infringed Claims 20 and 28-31 of the
'993 patent. Trial Tr. at 108:22-109:4. Kolcraft also
argued that Artsana induced its customers to infringe Claims
28-31, id. at 109:15-17; Artsana contributed to that
infringement, id. at 110:1-3; and Artsana infringed
the patent willfully, id. at 110:19-20. Both parties
presented fact and expert witnesses at trial, including
damages experts. Both of the damages experts opined on a
hypothetical reasonable royalty rate to award Kolcraft if the
jury found Artsana liable. Kolcraft's expert estimated a
reasonable royalty rate of 5.8%. Id. at 578:21-24.
Artsana's expert estimated a reasonable royalty rate of
2% at the very, very most. Id. at 870:17-20.
trial's end, the jury found for Kolcraft on all claims,
concluding that all of the accused products infringed each
asserted Claim of the '993 patent. R. 413, Verdict Form.
Indeed, the jury found in favor of Kolcraft on all 55 special
interrogatories. Id. It awarded Kolcraft $3, 245,
213.10, which equates to a 7% royalty rate on Artsana's
sales of the Lullaby products. Verdict Form at 7. The parties
now bring a series of post-trial motions. Artsana asks for
judgment as a matter of law under Rule 50 on all of
Kolcraft's claims. R. 398, Def.'s 50(a) JMOL; R. 407,
Def.'s Renewed 50(a) JMOL; R. 432, Def.'s 50(b) JMOL.
In the alternative, Artsana requests a new trial under Rule
59. R. 430, Def.'s Mot. New Trial. For its part, Kolcraft
has filed motions for a permanent injunction, R. 438,
Pl.'s PI Mot., enhanced damages and attorney's fees,
R. 440, Pl.'s Mot. Enhanced Damages, and prejudgment
interest, R. 423, Pl.'s Mot. Prejudgment Int.
Rule 50(a) of the Federal Rules of Civil Procedure, a
district court may enter judgment against a party who has
been fully heard on an issue during a jury trial if “a
reasonable jury would not have a legally sufficient
evidentiary basis to find for the party on that issue.”
Fed.R.Civ.P. 50(a). The Court “must construe the facts
strictly in favor of the party that prevailed at
trial.” Schandelmeier-Bartels v. Chi. Park
Dist., 634 F.3d 372, 376 (7th Cir. 2011).
“Although the court examines the evidence to determine
whether the jury's verdict was based on that evidence,
the court does not make credibility determinations or weigh
the evidence.” Id. And the Court “can
strike a piece of evidence from its weighing process only if
reasonable persons could not believe it because it
contradicts indisputable physical facts or laws.”
Mejia v. Cook County, Ill., 650 F.3d 631, 633 (7th
Cir. 2011) (cleaned up). Put another way, “[d]iscrepancies
arising from impeachment, inconsistent prior statements, or
the existence of a motive” will not render testimony
excludable. Whitehead v. Bond, 680 F.3d 919, 926
(7th Cir. 2012) (cleaned up).
may grant a motion for a new trial under Rule 59 if the
verdict is against the clear weight of the evidence or the
trial was unfair to the moving party. Clarett v.
Roberts, 657 F.3d 664, 674 (7th Cir. 2011). “In
passing on a motion for a new trial, the district court has
the power to get a general sense of the weight of the
evidence, assessing the credibility of the witnesses and the
comparative strength of the facts put forth at trial.”
Mejia, 650 F.3d at 633 (cleaned up). The district
court, however, may not simply substitute its judgment for
the jury's. “Since the credibility of witnesses is
peculiarly for the jury, it is an invasion of the jury's
province to grant a new trial merely because the evidence was
sharply in conflict.” Whitehead, 680 F.3d at
928. The standard for granting a new trial is thus relatively
high and a motion requesting as much will only be granted
“when the record shows that the jury's verdict
resulted in a miscarriage of justice or where the verdict, on
the record, cries out to be overturned or shocks our
conscience.” Id. at 927-28.
plaintiff seeking a permanent injunction must satisfy a
four-factor test before a court may grant such relief. A
plaintiff must demonstrate: (1) that it has suffered an
irreparable injury; (2) that remedies available at law, such
as monetary damages, are inadequate to compensate for that
injury (3) that, considering the balance of hardships between
the plaintiff and defendant, a remedy in equity is warranted;
and (4) that the public interest would not be disserved by a
permanent injunction.” Monsanto Co. v. Geertson
Seed Farms, 561 U.S. 139, 156-57 (2010) (cleaned up).
These principles apply equally to disputes arising under the
Patent Act. eBay, Inc. v. MercExchange, L.L.C., 547
U.S. 388, 391 (2006).
defendant is found liable for infringement, the Court will
often award prejudgment interest, which is the rule, not the
exception. Gen. Motors Corp. v. Devex Corp., 461
U.S. 648, 655-56 (1983). “An award of prejudgment
interest serves to make the patentee whole because the
patentee also lost the use of its money due to
infringement.” Crystal Semiconductor Corp. v.
TriTech Microelectronics Intern, Inc., 246 F.3d 1336,
1361 (Fed. Cir. 2001). Any justification for withholding the
award must bear a relationship to the award of prejudgment
interest itself. Gen. Motors, 461 U.S. at 655.
Enhanced Damages, Fees, and Post-Judgment Interest
§ 284 of the Patent Act allows courts to “increase
the damages up to three times the amount found or
assessed.” 35 U.S.C. § 284. District Courts, then,
have discretion to decide whether to award enhanced damages
and in what amount. Halo Elecs. v. Pulse Elecs., 136
S.Ct. 1923, 1931-32 (2016). The Supreme Court, though, has
clarified that enhanced damages are reserved for
“egregious cases of culpable behavior.”
Id. at 1932. The Court also has discretion to award
attorneys' fees and post-judgment interest. 35 U.S.C.
§ 285; 28 U.S.C. § 1961.
Defendant's Rule 50 Motions
currently has three motions for judgment as a matter of law
pending before this Court. First, Artsana made two
pre-verdict motions under Rule 50(a), R. 398 and R. 407, on
which the Court reserved ruling. Second, Artsana brought one
post-verdict motion under Rule 50(b). R. 432. Typically, the
issues addressed in a party's post-verdict motion mirror
those addressed in its pre-verdict motion, because a
post-verdict Rule 50(b) motion “can be granted only on
grounds advanced in the pre[-]verdict motion.”
Fed.R.Civ.P. 50, Advisory Comm. Notes. 2006 Am. Here, in its
post-verdict briefing, Artsana abandons two of its
pre-verdict arguments for judgment as a matter of law: (1)
Kolcraft failed to establish damages prior to June 3, 2009,