Patent Litigation Cases: Lumenis v. Alma
Lumenis is purportedly Israel's largest medical device company with more than 1,000 employees worldwide. Apparently, some of its former employees are now with another company, Alma Lasers, "in what has become a highly competitive industry and business environment," according to Lumenis CEO Dov Ofer.
In June 2007, Lumenis filed an action against Alma for patent infringement in the US District Court in Chicago, Illinois claiming that Alma infringed seven of Lumenis' patents in the design of the Harmony product. Lumenis initiated the Chicago litigation by filing suit against Alma Lasers on June 28, 2007.
On January 25, 2008, Alma filed counterclaims and, among other things, asked the Court to declare six of the seven Lumenis patents unenforceable due to inequitable conduct in procuring those patents. Alma alleged that, when applying for those six patents, the applicants breached their duty of candor, good faith and honesty to the PTO and engaged in inequitable conduct by making false representations to the PTO and by failing to disclose material prior art to the PTO. Lumenis denied the allegations.
Meanwhile, in December 2007, Alma submitted 22 prior art references to the PTO for consideration with respect to the seven Lumenis patents. Subsequently, the PTO found a "substantial new question of patentability" with respect to each of the seven patents, and commenced reexamination of them. With respect to one of those patents, the PTO, on February 8, 2008, issued an Office Action rejecting 26 claims of the patent as obvious or anticipated by the prior art. On February 21, 2008, the District Court ordered the litigation stayed pending the PTO's reexamination.
In a press release issued on March 26, 2008, Alma seemed pleased to report that: (1) the U.S. Patent and Trademark Office in Alexandria VA ("PTO") has decided to reexamine all seven of Lumenis's patents that are at issue in the litigation, and (2) the Court has stayed the litigation, pending reexamination of the patents.
Also on March 26, 2008, Lumenis issued its own press release announcing that the company had that very day filed a complaint in the Tel Aviv District Court in Israel against Alma Lasers Ltd. and its four founders, Ziv Karni, Yoav Avni, Nadav Bayer, and Ivgeni Kodritzki, all former employees of Lumenis, claiming misappropriation of Lumenis trade secrets and technology and for the use of such technology in Alma's primary Harmony products, which are sold worldwide. Lumenis has requested relief from the court in the form of an injunction against the use of such core technology by Alma in its products and for monetary damages in the amount of 200 million shekels based on the profits earned by Alma and its founders from the utilization of such Lumenis technology. Lumenis will also be filing a similar action against Alma Inc., the US subsidiary and distribution arm of Alma, in the Federal Court in the US.
This new action alleges that Alma went even further than mere patent infringement -- it alleges outright misappropriation of Lumenis technology that was developed by Lumenis over a long period of time and at Lumenis' great expense.
All of the above is reported verbatim from the press releases issued by the companies separately on March 26, 2008, which we've just pieced together to make some sense of the litigation of which both sides appear to be telling their part of the whole story. Anyway, both companies seem to want to get the news out, and we're happy to write about it here.
We're always looking for interesting patent disputes that turn on evidence of prior art and allegations of misappropriation of trade secrets. We'll keep you posted on this one. If either of the parties want to dispute the facts stated in their respective press releases, by all means feel free to have it out in the comments below. We're pleased to provide a forum for discussion of the patents on the merits.
