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Equalia, LLC v. Kushgo LLC

United States District Court, D. Nevada

January 11, 2017

EQUALIA, LLC and HOVBERBOARD TECHNOLOGIES CORPORATION, Plaintiff,
v.
KUSHGO LLC, et al., Defendants.

          ORDER

          RICHARD F. BOULWARE, II UNITED STATES DISTRICT JUDGE

         Plaintiff's Motion for a Temporary Restraining Order and Preliminary Injunction (ECF No. 10).

         I. INTRODUCTION

         Before the Court is Plaintiff's Motion for a Temporary Restraining Order and Preliminary Injunction (ECF No. 10). The Court has reviewed the parties' papers and heard oral argument. The Court previously announced its ruling orally in which it granted Plaintiff's Motion in part. This written order memorializes and elaborates this oral ruling.

         II. BACKGROUND

         A. Allegations & The Design Patent

         Plaintiffs Equalia, LLC, and Hoverboard Technologies Corporation filed a Complaint on Dec. 9, 2016 against Defendants Kushgo LLC, Halo Board LLC, Arthur Andreasyan and Shenzhen Windgoo Intelligent Technology Co. Ltd.. ECF No. 1. (Only the first three defendants have appeared in this case.) The complaint asserts two count: (1) Infringement of Plaintiff's design patent under 35 U.S.C. § 271, and (2) Unfair and Deceptive Trade Practices under 15 U.S.C. § 45.

         Plaintiffs filed the instant Emergency Motion for TRO and Preliminary Injunction on Dec. 28, 2016. ECF No 10. Defendants filed a Response on Dec. 29, 2016. ECF No. 17. Equalia seeks an injunction based on alleged infringement of its design patent. The patent issued as United States Design Patent No. D768, 252 on October 4, 2016, and is titled Pitch-Propelled Vehicle. Mot for TRO, Bigler Decl. at ¶4.

         The patent claims the ornamental design as depicted in five figures. The Court bases its conclusions on the images as depicted in the patent. The Court finds that the patent depicts the following distinct features, [1] among others:

         1. An oblong-shaped board with rounded edges and upturned ends.

         2. A slender single wheel in the center of the board, with two square-shaped bumper features with linear grooves on either side of the top of the wheel on the top of the board, and two angled plastic covers on either side of the bottom of the wheel.

         3. A cover or dome on top of the wheel, conforming to the contour of the wheel.

         4. A strip along the perimeter edge.

         5. A thick edge, consisting of that strip, and thick planks of material on either side, with the thick planks sloping inward toward the strip at the edge.

         6. Speakers on each end of the bottom of the board with a cone-shaped recess in the middle of the speakers containing a single light feature.

         7. Triangular skid pads on each corner, with smaller round protruding shape features on each of them.

         8. Dark, crescent-shaped displays on top front and back of the board.

         9. Ten, diamond-shaped panels dividing up the top surface of the board.

         Equalia seeks the following injunctive relief: (1) An order restraining Defendants from offering the “Halo Board” products for sale in the United States; (2) A seizure order for all of Defendants' infringing products, including the “Halo Board” from CES and Defendants' United States warehouse. (3) An order to show cause regarding the issuance of a preliminary injunction based on the ruling for a TRO.

         B. Evidentiary Hearing

         The Court held an evidentiary hearing with expert testimony on January 3, 2016. The Court incorporates by reference its statements and findings made on the record at this hearing (and previous hearings). At the January 3 hearing, the Court heard expert testimony from Plaintiff's expert Robert Bigler and Defendants' expert Brian Sanderson, as to the functionality of the design features and overall design of the board. Mr. Bigler testified that he is the owner and CEO of Plaintiff Equalia LLC, that he designed the design patent, that he has a degree in mechanical engineering from San Jose state university, and that he has been involved in the creation and testing of the product bearing the design patent. Mr. Sanderson testified that he is trained as an industrial designer, that he has degrees in industrial design and visual art and oil painting from Brigham Young University, and that since acquiring his degrees he has worked in industrial design, including projects related to board sports.

         The Court first notes that it finds Defendants' argument as to a Daubert disqualification of Plaintiff's expert witness to be unpersuasive. See Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579 (1993). Defendants argues that Daubert and rule 403 require the exclusion of testimony if the expert witness has an interest in the case. Daubert nowhere states that an expert witness must be disqualified because he has a relation to a party or a direct financial stake in the outcome. Daubert states that “the trial judge must determine at the outset, pursuant to Rule 104(a), whether the expert is proposing to testify to (1) scientific knowledge that (2) will assist the trier of fact to understand or determine a fact in issue.” Id. at 592. The Court did so here. Mr. Bigler submitted his CV, and his testimony attests to his engineering and design background, as well as his direct experience testing the functionality of the board. The Court finds no reason that Mr. Bigler was not qualified to testify as an expert in this case.

         The testimony of both witnesses focused on the functionality of the various features and of the design of the boards, including whether or not alternative designs could achieve the same or similar function. Upon observation, the Court generally credits and accepts Mr. Bigler's testimony, and does not credit or accept Mr. Sanderson's testimony. Sanderson's opinion was significantly less persuasive because he lacked sufficient knowledge of prior art related to the boards and knowledge of the actual operation and internal construction of the boards. The Court finds that Sanderson did not credibly establish the existence of relevant prior art. He was not familiar with the various patents submitted by Defendants as possible relevant prior art for Plaintiff's design.

         Plaintiffs admitted exhibits including but not limited to art in the form of design patent No. D769, 997 S, a single-wheeled board that the plaintiff testified is self-propelled, art in the form of a utility patent, No. 4, 824, 139, depicting a speaker on the bottom of a skateboard, a trademark application by Defendants showing a prior version of the Halo Board, and an image of the inside of a Halo Board, showing that only one of the spaces underneath a speaker feature contains an actual speaker.

         Defendants admitted exhibits including but not limited to an advertising video clip of the Plaintiff's board being used, as well as prior art in the form of utility patent No. 4, 991, 066, showing lights on the side of a board, design patent No. 7, 811, 217 B2, depicting a board with a center wheel and bumpers entitled “Motorized Apparatus and Method for Dynamic Balancing Exercise, ” and design patent No. D505, 469 S, depicting a board with two wheels that are covered on the top side of the board.

         III. ...


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