by Dennis Crouch
This decision shows how potential defendants can easily use their corporate structure to shelter a parent company from having to defend against patent infringement lawsuits.
Andra Group v. Victoria’s Secret Stores (Fed. Cir. Aug 3, 2021)
Andra sued Victoria’s Secret for infringing its US Pat. 8,078,498 covering a lingerie virtual showroom. Actually, Andra sued L Brands Inc (LBI), the parent company, as well as Victoria Secret Stores LLC (Stores) which operates the physical retail stores; Victoria’s Secret Direct Brand Management, LLC (Direct), which manages the internet activities (including in-store direct online and returns from the stores); and Victoria’s Secret Stores Brand Management, Inc. (Brand) which creates the apparel products. At the time of the lawsuit*, these companies were all directly linked together in a tight corporate subsidiary structure under LBI. Still, each defendant gets to raise the defense of improper venue.
Under the statute for patent litigation venue, venue is proper in a judicial district if either (1) the defendant is incorporated in the district or (2) the defendant infringes within the district and also has a “regular and established places of business” in the district. 28 U.S.C. 1400(b). Here, none of the defendants are incorporated in E.D. Texas and only the VS Stores has a regular-and-established-place-of-business in the district. As such, the district court dismissed the case against all of the non-stores defendants and, at that point, Andra also voluntarily dismissed its case against VS Stores.
On appeal, the Federal Circuit affirmed — particularly holding that the VS Stores do not serve as places of business for the non-store defendants. The court concluded that Andra had not proven that LBI sufficiently controls VS Stores despite public filings by LBI that dictate various “store operations, hiring, and conduct” and that the stores are acknowledged representatives of Brand and Direct (returns go the roughte website …). The court found that LBI’s public filings were statements about the various brands, but did not necessarily convey control over its wholly owned subsidiaries. The decision goes on, but basically serves as a total apologist for
* On August 3, 2021, LBI spun-off all of the Victoria Secret companies into a separate company VS&Co (VSCO) and LBI has changed its name to Bath & Body Works Inc. (BBWI). Its totally unclear how this change would impact the lawsuit. Also, this is confusing because of VSCO.
Claim 1 is: “A method of displaying an article within a virtual showroom associated with a network server, comprising:
providing, by a processor, a plurality of thumbnail images of said article, each image comprising an icon and representing a respective perspective view of said article, allowing a user of said network server to select one of said plurality of thumbnail images for display in a master display field wherein each respective perspective view represents a different perspective view of the same said article, each respective perspective view being selected from the group consisting of front, rear, side, and isometric views;
providing a distinctive characteristic to said one of said plurality of thumbnail images selected by said user; and
displaying said selected one of said plurality of thumbnail images in said master display field.”
I suspect the venue Gordian knot of corporate defendant layers here will get cut by a granted IPR, 101 motion or some kind of cases-consolidation? But with these claims will the location of the indicated “network server” determine the venue question of where the infringement occurs?
It’s a showroom! Except virtual!
Sad that there is no reference to AI in the claims because then we’d know how super techno this stuff is. Can I play a virtual bingo game while looking at the u derwear? Or look at the stock market? Available real estate? That would make a hige difference too.
Now excuse me while I figure how to make hot dogs for each of my 13 children simultaneously.
That claim isn’t looking good for the patentee.
The CAFC will almost assuredly mow it down with 101. Or a 101 motion, but they would need an Alice judge.
For the IPR, maybe. I can think of three references I could put together for that one.
You can think of three e-commerce websites. A grand total of three?
How about three million “references” that no reasonable person would expect to patent?
Patent Quality is a myth, amitrite?
Martin, yes there are many others, but the point is that it would take only three patents to render it obvious. And there are lots of specific elements in the claim that would have to be accounted for.
Gee, Marty is taking terms in a colloquial manner as opposed to a legal manner.
Who would have have guessed that he would do that?
/s
+1
The Victoria Secret STORES did have venue in EDTX. But that can’t be imputed to the non-store entity. The nature of the claim doesn’t change any of that. In re Google has already held that servers aren’t places of business.
Yep – the decision discusses that aspect.
For whatever (continuing) reason, the omitted panel is:
Before REYNA, MAYER, and HUGHES, Circuit Judges.
HUGHES, Circuit Judge.
Patents are not for inventors, they are for large corporations (and other grifters). Inventors are gradually getting the message, but it is hard to accept.
There is no invention here. But sure keep crying a river for the worst people ever! Boo hoo hoo.
Josh, your anger is misdirected. The reason your case was so hard to win is because people like this abuse the patent system with claims like these.
The moral arc of the United States bends towards corporatocracy. Like every aspect of government, patents are a tool of the corporations, hedge funds, and rich to extract wealth and resources from everyone else.
“The moral arc of the United States bends towards corporatocracy.”
I would rephrase that as the LACK of moral arc bends towards corporatocracy.
OSitA, I do believe that we may have an area of consideration in common…..
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