MONY Life Insurance of New York has ended its bid to recover the attorney’s fees it spent during a six-year legal battle with the National Licensing Association.
MONY’s attorney Paul Swanson, with Lane Powell PC in Seattle, Washington, asked the U.S. District Court of Washington to dismiss its suit against the NLA, saying it did not make economic sense to continue to pursue recovery of legal costs.
MONY was a defendant in one of the first cases filed by the NLA in 2002 alleging patent and trademark infringement. The company had repossessed an orchard in Washington State that the NLA alleged had illegally propagated Scarlet Spur Red Delicious and Smoothee Golden Delicious trees. The orchard owners and management company were also sued but settled with the NLA. MONY declined to settle and filed counterclaims against the NLA alleging that its action against a financial institution was a misuse of U.S. patents and trademarks.
In 2004, after U.S. District Court Judge Lonny Suko ruled that the NLA had no standing to sue on behalf of patent holders, the NLA refiled the case with the nurseries that held the Scarlet Spur and Smoothee patents named as plaintiffs.
Judge Suko ruled that MONY did not infringe the patents or trademarks and the two nurseries (Van Well Nursery in Washington and Hilltop Nursery in Michigan) settled with MONY by paying $75,000 each.
MONY then asked for attorney’s fees to be awarded against the NLA. Attorney’s fees can be awarded in exceptional cases to prevailing parties, but in March this year, Judge Suko ruled that MONY had not prevailed over the NLA, as it was not named in the suit.
On April 15, the NLA attorneys and MONY’s attorney, Swanson, held a conference call with the judge to discuss whether MONY’s claims against the NLA should go to trial. Swanson asked the judge to dismiss the case, with no costs awarded.
"We decided the cost of going to trial didn’t pencil out economically," he said. "I think the claims have a lot of merit, but you can win a case and lose because you can never recover what you spent."
He said the judge also questioned whether it would make economic sense for the case to go to trial.
Lack of standing
Swanson said he became involved in the NLA litigation when he represented Inland Fruit Company, which the NLA had sued for allegedly infringing several apple-variety patents and trademarks. That case was the first to be dismissed on the grounds that the NLA did not have legal standing to sue on behalf of patent holders, and it led to the dismissal of other pending suits.
At the same time, Swanson was also representing MONY, a case that also resulted in other significant precedential decisions on patent and trademark claims, he said. "I think it’s led to some case law that didn’t exist before that should provide some guidance for people who are thinking that they can bring the financing companies into patent and trademark infringement claims because they’re buying and selling agricultural property."
Rex Stratton, managing partner of the NLA, said he and his partner Pat Ballew do not intend to refile any of the suits that were dismissed, but they will continue to try to make the tree fruit industry aware that pirating trees is not appropriate and the NLA will take enforcement measures where necessary.
"We’re not going to go out and sue every bank and every grower, but where it comes to our attention that someone has been particularly out of hand in terms of enforcement, then the NLA will most likely take action if we don’t get voluntary compliance," he said. "Still, the goal is to have people realize that propagating trees without a license is a little bit like sheep stealing."
Many varieties are now in the public domain, Stratton noted, and are freely available. Some patents that were the subject of previous NLA actions have since expired, and in the MONY case, the judge ruled that the name Scarlet Spur had become generic and could no longer operate as a trademark. But Stratton said the NLA would be actively working to protect the patents and trademarks of newer varieties, including Pink Lady. "Clearly, the people who are developing the new varieties are going to want to protect those varieties," he said.