Case 1:16-cv-00041-CFC Document 375 Filed 07/16/20 Page 1 of 13 PageID #: 15354
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELA WARE
`
`F'REAL FOODS, LLC and RICH
`PRODUCTS CORPORATION,
`
`Plaintiff,
`
`V.
`
`Civil Action No. 16-41-CFC
`
`HAMILTON BEACH BRANDS,
`INC. and HERSHEY CREAMERY
`COMPANY,
`
`Defendant.
`
`Rodger D. Smith II, Michael J. Flynn, and Taylor Haga, MORRIS, NICHOLS,
`ARSHT & TUNNELL LLP, Wilmington, Delaware; Guy W. Chambers and Peter
`Colosi, SIDEMAN & BANCROFT LLP, San Francisco, California
`
`Counsel for Plaintiff
`
`Francis Di Giovanni and Thatcher A. Rahmeier, F AEGRE DRINI(ER BIDDLE &
`REATH LLP, Wilmington, Delaware; William S. Foster Jr., Kenneth M. Vorrasi,
`and Brianna L. Silverstein, DRINKER BIDDLE & REATH LLP, Washington,
`D.C.
`
`Counsel for Defendant
`
`MEMORANDUM OPINION
`
`July 16, 2020
`Wilmington, Delaware
`
`
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELA WARE
`
`F'REAL FOODS, LLC and RICH
`PRODUCTS CORPORATION,
`
`Plaintiff,
`
`V.
`
`Civil Action No. 16-41-CFC
`
`HAMILTON BEACH BRANDS,
`INC. and HERSHEY CREAMERY
`COMPANY,
`
`Defendant.
`
`Rodger D. Smith II, Michael J. Flynn, and Taylor Haga, MORRIS, NICHOLS,
`ARSHT & TUNNELL LLP, Wilmington, Delaware; Guy W. Chambers and Peter
`Colosi, SIDEMAN & BANCROFT LLP, San Francisco, California
`
`Counsel for Plaintiff
`
`Francis Di Giovanni and Thatcher A. Rahmeier, F AEGRE DRINI(ER BIDDLE &
`REATH LLP, Wilmington, Delaware; William S. Foster Jr., Kenneth M. Vorrasi,
`and Brianna L. Silverstein, DRINKER BIDDLE & REATH LLP, Washington,
`D.C.
`
`Counsel for Defendant
`
`MEMORANDUM OPINION
`
`July 16, 2020
`Wilmington, Delaware
`
`
`
`Case 1:16-cv-00041-CFC Document 375 Filed 07/16/20 Page 2 of 13 PageID #: 15355
`
`COLMF. CONNOLL
`UNITED ST A TES DISTRICT JUDGE
`
`Plaintiffs freal Foods, LLC and Rich Products Corporation sued Defendants
`
`Hamilton Beach Brands, Inc. and Hershey Creamery Company for infringement of
`
`U.S. Patent No. 5,803,377 (the #377 Patent), U.S. Patent No. 7,144,150 (the #150
`
`Patent), U.S. Patent No. 7,520,658 (the #658 Patent), and U.S. Patent No.
`
`7,520,662 (the #662 Patent). Plaintiffs alleged that four products infringed the
`
`asserted patents: the IMI2000, the BIC2000, the BIC3000-DQ, and the MIC2000.
`
`The four accused products are high performance blenders manufactured by
`
`Hamilton Beach.
`
`The Court held a four-day jury trial. The jury found that all four accused
`
`products infringe claim 21 of the #662 Patent; that the MIC2000, BIC2000, and
`
`BIC3000-DQ literally infringe claim 20 of the #150 Patent; that the MIC2000,
`
`BIC2000, and BIC3000-DQ infringe claim 22 of the #150 Patent under the
`
`doctrine of equivalents; that all four accused products infringe claims 1 and 5 of
`
`the #658 Patent under the doctrine of equivalents; that the MIC2000, BIC2000,
`
`BIC3000-DQ, or the IMI2000 literally infringes claims 6, 10, and 11 of the #658
`
`Patent; that none of the accused products infringe the #3 77 Patent; and that none of
`
`the asserted patents are invalid. See D.I. 264.
`
`
`
`Case 1:16-cv-00041-CFC Document 375 Filed 07/16/20 Page 3 of 13 PageID #: 15356
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`Posttrial I granted Defendants' motion for Judgment as a Matter of Law of
`
`noninfringement of claim 21 of the #662 Patent by Defendants. See D.I. 355.
`
`Pending before me is Plaintiffs' Motion for a Permanent Injunction and
`
`Recall (D.I. 287). By their motion, Plaintiffs seek an order that (1) enjoins
`
`Defendants from infringing the #150 and the #658 patents by the commercial
`
`manufacture, use, sale, or offer to sell within the United States, or importation into
`
`the United States, the MIC2000, BIC2000, BIC3000-DQ or IMI2000 blenders, or
`
`any substantially similar products prior to the expiration of the #150 and the #658
`
`patents and (2) requires Hamilton Beach and Hershey to recall all MIC2000 and
`
`BIC3000-DQ blenders. See D.I. 287.
`
`I.
`
`LEGAL STANDARD FOR PERMANENT INJUNCTION
`
`The Patent Act grants a patent holder "the right to exclude others from
`
`making, using, offering for sale, or selling the invention throughout the United
`
`States or importing the invention into the United States .... " 35 U.S.C. §
`
`154(a)(l). The right to exclude "has its roots in the U.S. Constitution's Intellectual
`
`Property Clause, which refers to inventors' 'exclusive Right to their respective ...
`
`Discoveries."' Apple Inc. v. Samsung Elecs. Co., 809 F.3d 633,638 (Fed. Cir.
`
`2015) (hereinafter Apple IV) (quoting U.S. Const. art. I, § 8, cl. 8.). "In furtherance
`
`of this right to exclude, district courts 'may grant injunctions in accordance with
`
`2
`
`
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`Case 1:16-cv-00041-CFC Document 375 Filed 07/16/20 Page 4 of 13 PageID #: 15357
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`the principles of equity to prevent the violation of any right secured by patent, on
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`such terms as the court deems reasonable."' Id. ( quoting 35 U.S.C. § 283).
`
`A Plaintiff seeking a permanent injunction 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." eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388,391
`
`(2006) ( citation omitted). To satisfy the irreparable injury factor, a patentee must
`
`establish ( 1) that absent an injunction it will suffer irreparable injury and (2) that a
`
`sufficiently strong causal nexus relates the injury to the infringement. See Apple
`
`Inc. v. Samsung Elecs. Co., 735 F.3d 1352, 1361 (Fed. Cir. 2013) (hereinafter
`
`Apple III). The Supreme Court has cautioned lower courts that "[a]n injunction is
`
`a drastic and extraordinary remedy, which should not be granted as a matter of
`
`course." Monsanto Co. v. Geertson Seed Farms, 561 U.S. 139, 165 (2010)
`
`( citation omitted). Rather, when "a less drastic remedy ... [is] sufficient to redress
`
`[ a plaintiffs] injury, no recourse to the additional and extraordinary relief of an
`
`injunction [is] warranted." Id. at 165-66 ( citations omitted).
`
`3
`
`
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`Case 1:16-cv-00041-CFC Document 375 Filed 07/16/20 Page 5 of 13 PageID #: 15358
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`II. ANALYSIS
`
`A.
`
`The IMI2000 Blenders
`
`Plaintiffs have failed to show that they would suffer irreparable harm from
`
`the continued sales of the IMI2000. Plaintiffs mention the IMI2000 only twice in
`
`their opening brief. On page 6, Plaintiffs state that the IMI2000 competes with
`
`f'real's blender sales. See D.I. 288 at 6. Plaintiffs offer neither citation nor
`
`argument in support of this conclusory statement. On page 11 of their opening
`
`brief, Plaintiffs explain that they are not seeking a recall of the IMI2000 "because
`
`of the relatively small number sold since 2015." D.I. 288 at 11 n. 5. Plaintiffs'
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`reply brief is silent on the IMI2000. See D.I. 331. Accordingly, I will deny their
`
`motion insofar as it concerns the IMI2000.
`
`B.
`
`The BIC2000 Blenders
`
`Plaintiffs argue that the "BIC2000 ... compete[s] directly with f'real's own
`
`blenders sales" and that "f'real's LT blender is priced competitively to the
`
`infringing BIC3000-DQ or BIC2000, with the same blending capabilities." D.I.
`
`288 at 6-7. Plaintiffs appear to be arguing that their irreparable injury is lost sales
`
`of the LT blender. Plaintiffs, however, adduced no evidence of lost sales of the LT
`
`blender. Moreover, Defendants argue, and Plaintiffs do not rebut, that the LT
`
`blender does not have the same blending capabilities as the BIC2000 because the
`
`BIC2000 is "designed to mix ice and liquid drink mix" while f'real's blenders are
`
`4
`
`
`
`Case 1:16-cv-00041-CFC Document 375 Filed 07/16/20 Page 6 of 13 PageID #: 15359
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`"designed to grind a frozen substance. D.I. 310 at 13 ( citing Williams Deel., D.I.
`
`311 ,r,r 4-5).
`
`Because Plaintiffs have not put forward evidence of lost sales or any other
`
`injury caused by sales of the BIC2000 and Defendants have put forward unrebutted
`
`evidence that freal's blenders do not compete with the BIC2000, Plaintiffs have
`
`not established that they have suffered an in-eparable injury related to the BIC2000
`
`blenders. Accordingly, I will deny Plaintiffs' motion insofar as it concerns the
`
`BIC2000.
`
`C.
`
`The BIC3000-DQ Blenders
`
`First, Plaintiffs argue that the BIC3000-DQ "compete[s] directly with
`r real' s own blenders sales" and that "f real' s LT blender is priced competitively to
`
`the infringing BIC3000-DQ or BIC 2000, with the same blending capabilities."
`
`D.I. 288 at 6-7.
`
`Defendants cast doubt on the assertion that the LT blender has the same
`
`blending capabilities as the BIC3000-DQ. Defendants point out that the BIC3000-
`
`DQ is designed to blend Dairy Queen's soft serve ice cream and mix-ins while
`
`freal's blenders are designed to shave through frozen blocks. See D.I. 310 at 8
`
`( citing Trial Tr. at 212: 17-23; 271: 10-18; and 495: 19-21; D.I. 311 ,r 7).
`
`In reply, Plaintiffs argue that the LT blender can blend soft serve ice cream
`
`and cite the Declaration of Jens Voges for that proposition. See D.I. 331 at 7
`
`5
`
`
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`Case 1:16-cv-00041-CFC Document 375 Filed 07/16/20 Page 7 of 13 PageID #: 15360
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`( citing D.I. 332 ,r 6). But the Voges Declaration does not say that the LT blender
`
`would work on soft serve ice cream. Rather, Voges stated: "In response to Mr.
`
`Williams' argument about whether a freal blender could work with Dairy Queen's
`
`soft-serve ice cream, f real has already developed a solution incorporated in all of
`
`its blenders that solves the issue Mr. Williams states as being '[t]he biggest hurdle
`
`to developing the BIC3000-DQ."' D.I. 332 ,r 6 ( quoting D.I. 311 ,r 7). Williams,
`
`however, did not say that blending soft-serve ice cream as opposed to frozen
`
`blocks was the biggest hurdle to developing that BIC3000-DQ. What he said was:
`
`The biggest hurdle to developing the BIC3000-DQ was
`being able to incorporate the mix-ins used by Dairy Queen
`throughout the entire height of a cup for each of the
`different types of beverages blended by Dairy Queen in
`different sizes of cups in a way that met Dairy Queen's
`quality and performance standards. In order to overcome
`this hurdle, we invented a new cup holder that could both
`tilt and rotate the cup during the blending process to mimic
`the actions of a human operator blending Dairy Queen's
`beverages using a Hamilton Beach spindle mixer. The
`tilting and rotation of the cup allowed the agitator to cover
`more of the volume within the cup (including the cup edge
`along the entire cup height) as accomplished during the
`manual mixing process. This invention is described in the
`claims of U.S. Patent No. 9,474,417, and is illustrated in
`Figs. 16, 16A, 16B, and 17 and at Col. 12:46-14:59 of the
`specification
`
`D.I. 311 ,r 7. Voges answered whether freal's blenders could handle Dairy
`
`Queen's mix-ins. Voges did not answer whether freal's blenders could blend
`
`Dairy Queen's soft-serve ice cream. Plaintiffs have, therefore, supplied no
`
`6
`
`
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`Case 1:16-cv-00041-CFC Document 375 Filed 07/16/20 Page 8 of 13 PageID #: 15361
`
`evidence that the LT blender is capable of blending soft-serve ice cream. Nor have
`
`they provided evidence that another of their blenders is capable of blending soft(cid:173)
`
`serve ice cream and would be a suitable replacement for the BIC3000-DQ.
`
`Without a blender that can perform the core function of the BIC3000-DQ, that is,
`
`blending soft-serve ice cream, Plaintiffs cannot show that they have been harmed
`
`by losing the opportunity to sell their blenders to Dairy Queen in the place of the
`
`BIC3000-DQ.
`
`Even if Plaintiffs could show that they have been harmed by losing the
`
`opportunity to sell their blenders to Dairy Queen in the place of the BIC3000-DQ,
`
`they have failed to show that there is a causal nexus between the patented features
`
`and the demand for the BIC3000-DQ. "[P]roving a causal nexus requires the
`
`patentee to show 'some connection' between the patented features and the demand
`
`for the infringing products." Apple IV, 809 F.3d at 641 (quoting Apple III, 735
`
`F.3d at 1364). Plaintiffs do not allege, much less provide evidence supporting, a
`
`connection between the patented features of the BIC3000-DQ and Dairy Queen's
`
`demand for the BIC3000-DQ. See D.I. 288; D.I. 331. Accordingly, Plaintiffs have
`
`not shown that lost sales of the LT blender to Dairy Queen are an irreparable injury
`
`that supports a permanent injunction with respect to the BIC3000-DQ.
`
`Second, Plaintiffs argue that they have been irreparably injured by losing
`
`sales off real smoothies and milkshakes to competition with Dairy Queen. But
`
`7
`
`
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`Case 1:16-cv-00041-CFC Document 375 Filed 07/16/20 Page 9 of 13 PageID #: 15362
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`Plaintiffs have not alleged, or provided evidence supporting, a connection between
`
`the patented features of the BIC3000-DQ and those lost sales. "The causal nexus
`
`requirement ensures that an injunction is only entered against a defendant on
`
`account of a harm resulting from the defendant's wrongful conduct, not some other
`
`reason" such as '" iITeparable harm caused by otherwise lawful competition."'
`
`Apple IV, 809 F.3d at 640 (quoting Apple III, 735 F.3d at 1361). Here, without
`
`evidence of a connection between the patented feature of the BIC3000-DQ and
`
`Plaintiffs' lost sales, there is no way of knowing what sales were lost due to
`
`Defendants' wrongful conduct and what sales were lost due to lawful competition
`
`with Dairy Queen. Because Plaintiffs have not provided evidence of a causal
`
`connection, they have not shown that lost sales of smoothies and milkshakes to
`
`Dairy Queen are an iITeparable injury that supports a permanent injunction with
`
`respect to the BIC3000-DQ.
`
`D.
`
`The MIC2000 Blenders
`
`All four eBay factors favor granting Plaintiffs' motion for a permanent
`
`injunction and recall with respect to the MIC2000 blenders used in Hershey's
`
`Shake Shop Express program.
`
`First, Plaintiffs have demonstrated that they have been and will continue to
`
`be irreparably injured due to being forced to compete with the MIC2000 blenders
`
`in the Shake Shop Express Program. At trial, Plaintiffs' damages expe1i limited
`
`8
`
`
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`Case 1:16-cv-00041-CFC Document 375 Filed 07/16/20 Page 10 of 13 PageID #: 15363
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`his lost profits analysis to the MIC2000, see Trial Tr. 599:8-16, and the jury found
`
`the Defendants liable for lost profits due to the MIC2000 blenders used in the
`
`Shake Shop Express program. D.I. 264, Question 7(b ). 1
`
`When a patentee is "forced to compete against products that incorporate and
`
`infringe its own patented inventions[,]" the patentee suffers a harm that is often
`
`irreparable. Douglas Dynamics, LLC v. Buyers Prod. Co., 717 F.3d 1336, 1345
`
`(Fed. Cir. 2013) (finding an irreparable injury). And when a jury awards a
`
`patentee lost profits, the jury necessarily finds both this kind of competition and
`
`that the defendant's action caused the patentee to lose sales. Thus, an award oflost
`
`profits "squarely supports a finding of irreparable harm." Presidio Components,
`
`Inc. v. Am. Tech. Ceramics Corp., 702 F.3d 1351, 1363 (Fed. Cir. 2012). It may
`
`seem odd that a monetary award supports a finding of irreparable injury. But a
`
`finding of lost profits demonstrates that a plaintiff was deprived of market share
`
`and business opportunities in addition to lost profits. A lost profits award does not
`
`compensate a plaintiff for those first two harms; and money damages alone cannot
`
`fully compensate a plaintiff for those harms. See Robert Bosch LLC v. Pylon Mfg.
`
`1 Posttrial, Defendants moved for judgment as a matter of law of no lost profits, or,
`in the alternative motion for a new trial on or remittitur of lost profits. D.I. 296. I
`denied that motion conditioned upon Plaintiffs' acceptance of the Court's
`remittitur of Plaintiffs' lost profits award to $2,091,841.00. D.I. 367. Plaintiffs
`have accepted the Comi's remittitur. D.I. 368.
`
`9
`
`
`
`Case 1:16-cv-00041-CFC Document 375 Filed 07/16/20 Page 11 of 13 PageID #: 15364
`
`Corp., 659 F.3d 1142, 1155 (Fed. Cir. 2011) ("[Plaintiff] argues that it will
`
`continue to suffer irreparable harm due to lost market share, lost business
`
`opportunities, and price erosion unless [Defendant] is permanently enjoined.
`
`According to [Plaintiff], money damages alone cannot fully compensate
`
`[Defendant] for these harms. We agree."). Thus, I infer from the jury's award of
`
`lost profits that Plaintiffs have suffered an irreparable injury due to the MIC2000
`
`blenders Hershey used in the Shake Shop Express program. 2
`
`Plaintiffs have also shown that there is a causal nexus between Defendants'
`
`infringement and Plaintiffs' lost profits, lost market share, and lost business
`
`opportunities. Plaintiffs' patents are for self-cleaning blenders. The MIC2000 is a
`
`self-serve, self-cleaning blender. Because the MIC2000, using technology covered
`
`by Plaintiffs' patents, cleans itself, the retailers who kept the MIC2000 in their
`
`stores as part of the Shake Shop Express program did not have to spend money on
`
`labor to clean the machine between each use. Similarly, customers who used
`
`MIC2000 blenders to blend milkshakes would not have been inclined to do so had
`
`the MIC2000 blenders been dirty because the machines couldn't clean themselves.
`
`Thus, there is a clear connection between the infringement and Plaintiffs' injury.
`
`2 This finding does not extend to MIC2000 blenders not used in the Shake Shop
`Express program. Plaintiffs adduced no evidence of lost profits that do not stem
`from the Shake Shop Express program.
`
`10
`
`
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`Case 1:16-cv-00041-CFC Document 375 Filed 07/16/20 Page 12 of 13 PageID #: 15365
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`Second, monetary damages are inadequate to compensate Plaintiffs' injuries.
`
`The Federal Circuit has held that "loss of market share" and other injuries like
`
`Plaintiffs' are "particularly difficult to quantify." i4i Ltd. P'ship v. Microsoft
`
`Corp., 598 F.3d 831, 862 (Fed. Cir. 2010), affd, 564 U.S. 91 (2011). "Difficulty
`
`in estimating monetary damages is evidence that remedies at law are inadequate."
`
`Id. (citation omitted). Although Defendants claim that "[a]ny harm to freal is
`
`quantifiable[,]" Defendants do not even attempt to monetize freal's lost market
`
`share or lost business opportunities. D.I. 310 at 15.
`
`Third, the balance of the hardships between Plaintiffs and Defendants favors
`
`a remedy in equity. It follows from a finding of lost profits that as long as
`
`Defendants are permitted to continue infringing Plaintiffs' patents, Plaintiffs will
`
`continue to lose profits, lose business opportunities, and be deprived of market
`
`share. In this case, Defendants have made it clear that unless they are enjoined
`
`they will continue to infringe Plaintiffs' patents until they have finished selling
`
`their stock of ice cream cups used in the Shake Shop Express program. See D.I.
`
`357, Ex. C iTiT 5-7. Thus, even if monetary relief were adequate to compensate
`
`Plaintiffs for their injuries, Plaintiffs would have to file another lawsuit to obtain
`
`that relief. The danger of a "multiplicity of suits" and the hardship that entails for
`
`a plaintiff have traditionally justified an equitable remedy, such as an injunction,
`
`that would afford a plaintiff complete relief in a single proceeding. See, e.g.,
`
`11
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`
`
`Case 1:16-cv-00041-CFC Document 375 Filed 07/16/20 Page 13 of 13 PageID #: 15366
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`Graves v. Texas Co., 298 U.S. 393,403 (1936) ("Resort may be had to equity in
`
`order to avoid the multiplicity of suits .... "), overruled on other grounds by
`
`Alabama v. King & Boozer, 314 U.S. 1 (1941).
`
`Fourth, I am not persuaded that the public interest would be disserved by a
`
`permanent injunction. Indeed, Defendants do not even argue that the public
`
`interest would be disserved if an injunction issued with respect to the MIC2000.
`
`SeeD.I. 310 at 17.
`
`III. CONCLUSION
`
`For the foregoing reasons, I will grant in part and deny in part Plaintiffs'
`
`Motion for a Permanent Injunction and Recall (D.I. 287). I will grant the motion
`
`insofar as its seeks to prohibit Defendants from infringing the #150 and #658
`
`patents by the commercial manufacture, use, sale, or offer to sell within the United
`
`States, or importation into the United States, of the MIC2000 blenders prior to the
`
`expiration of those patents. I will also grant the motion insofar as it seeks an order
`
`to compel Defendants to recall the MIC2000 blenders used in connection with
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`Hershey's Shake Shop Express program. I will otherwise deny the motion.
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`The Comi will issue an order consistent with this Memorandum Opinion.
`
`12
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`
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