Justia U.S. 10th Circuit Court of Appeals Opinion Summaries

Plaintiffs DISH Network Corporation and DISH Network LLC (Dish) filed a diversity action in the District of Colorado seeking a judgment declaring that Dish's insurers had a duty under Colorado law to defend Dish in a patent infringement suit. The district court held that the underlying complaint did not allege an "advertising injury" under the policies issued to Dish by the five defendant Insurers. The court granted Insurers' motion for summary judgment, and Dish appealed. In its amended complaint, Ronald A. Katz Tech. Licensing (RAKTL, the Plaintiff in the underlying suit) alleged that Dish had infringed one or more claims in each of twenty­ three patents. Applying Colorado law, the district court concluded that a claim for patent infringement could "properly give rise to coverage, or even the specter of coverage, such that an insurer will have a duty to defend." For purposes of the summary judgment motion, the court ruled that RAKTL's reference to "customer service functions" in its complaint was sufficient to allege that Dish engaged in "advertising." The court granted summary judgment for Insurers without addressing the third element of its test-­- causation --or the additional arguments certain insurers had raised under their individual policies. Upon review, the Tenth Circuit concluded that the RATKL complaint potentially alleged advertising injury arising from the misappropriation of advertising ideas. The Court therefore reversed and remanded for further proceedings: "the scope of advertising injury coverage in this case is at least ambiguous with regard to patent infringement allegations. Although the cases are rare in which an allegedly infringed patent is itself an advertising idea rather than merely an advertised product, ... we hold that '[d]epending on 'the context of the facts and circumstances of th[e] case,' patent infringement can qualify as an advertising injury if the patent 'involve[s] any process or invention which could reasonably be considered an 'advertising idea.'"

Plaintiff ClearOne Communications, Inc. (ClearOne) filed suit against Defendant Biamp Systems (Biamp) alleging that Biamp misappropriated ClearOne's trade secrets by licensing a product from another company that incorporated those trade secrets. A jury found in ClearOne's favor on all of its claims against Biamp. The district court assessed damages for lost profits and unjust enrichment, and awarded ClearOne exemplary damages, attorneys' fees and nontaxable expenses. Biamp raised multiple issues on appeal pertaining to the trial court's application of the applicable statutory authority and in its award of damages. Upon review, the Tenth Circuit affirmed all aspects of the district court's judgment except for the lost profits and exemplary damages awards. The Court reversed and remanded the case for reconsideration of damages owed to ClearOne Communications.

Plaintiff ClearOne Communications, Inc. (ClearOne) filed suit against Defendants Andrew Chiang, Jun Yan, Lonny Bowers, WideBand Solutions, Inc. and Versatile DSP, Inc. (collectively the WideBand Defendants), alleging misappropriation of trade secrets. Mssrs. Chiang, Yan and Bowers are all former engineers of ClearOne who had a hand in developing "acoustic echo cancelling" technology. The court ordered an injunction against the former engineers for their part in transferring the assets of WideBand to a "new, sham company" under the control of Donald Bowers. In this case, Donald Bowers as an Interested Nonparty appealed from an order of contempt issued against him by the district court for violation of the injunction. Upon review, the Tenth Circuit found that Mr. Bowers made no attempt to explain how the court abused its discretion in issuing the contempt order. Accordingly, the Tenth Circuit affirmed the district court.

Plaintiff ClearOne Communications, Inc. (ClearOne) filed suit against Defendants Andrew Chiang, Jun Yan, Lonny Bowers, WideBand Solutions, Inc. and Versatile DSP, Inc. (collectively the WideBand Defendants), alleging misappropriation of trade secrets. Mssrs. Chiang, Yan and Bowers are all former engineers of ClearOne who had a hand in developing "acoustic echo cancelling" technology. Prior to their departure, the technology had been licensed from ClearOne by WideBand. When WideBand ended its licensing agreement with ClearOne, ClearOne became suspicious and conducted an internal investigation to find that its former engineers were now associated with WideBand. Furthermore, WideBand was using the proprietary technology it had once licensed. The case proceeded to trial, and ClearOne prevailed on all of its claims. The district court entered a final judgment, as well as a permanent injunction in favor of ClearOne. The court later learned that the Defendants along with several interested parties violated the terms of the injunction. The WideBand Defendants and the interested parties filed a number of appeals. The Tenth Circuit consolidated twelve cases into its holding, taking each Defendant-Appellant's arguments in turn. After careful consideration of the parties' arguments, the Court found no abuse of discretion by the trial court. The Court affirmed the trial court's decision in favor of ClearOne.