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  • Shelly Albaum

CDXC Replies to Elysium's Opposition to Dismissal of the Patent Misuse Claim


We now have Cooley's reply; you can read it here:

ChromaDex's Reply to Elysium's Opposition to ChromaDex's Motion to Dismiss Elysium's Patent Misuse Counterclaim

I think most people will not be interested in reading WAY down in weeds here, as the parties argue the intricacies of jurisdiction and mootness.

And I can't do too much to make it fun and interesting, because it's neither.

To recap how we got to this point:

  • ChromaDex sued Elysium for breach of contract and fraud

  • Elysium answered with a counterclaim requesting a declaratory judgment that ChromaDex had misused its patent by requiring Elysium to pay for the use of ChromaDex's trademarks pursuant to a "Trademark License and Royalty Agreement."

  • That was a bogus claim for a lot of legal reasons, but my favorite is that Elysium was not required to use or pay for the trademarks. But the judicial clerks in the central district, who are the only ones who actually read all the litigation materials, don't know anything about Patent Misuse and got snookered by the ol' razzle-dazzle from Skadden.

  • Since the Patent Misuse claim was allowed to proceed, ChromaDex decided to short-circuit the process by simply disclaiming any of its rights under the Trademark License and Royalty Agreement. That should have simultaneously (1) mooted Elysium's counterclaim, (2) purged any patent misuse, and (3) resolved any potential damages.

  • ChromaDex did that because they've got better things to do than pay lawyers to fight over this crap.

  • Elysium does not find itself similarly situated, and so last week it shat out a bunch of bogus reasons why the Court should continue to entertain a bogus Patent Misuse claim even in the absence of any predicate for the claim. The most interesting reason Elysium proffered was a suggestion that it had a reasonable fear that ChromaDex would be suing it for patent infringement in the near future. That's SUPER-interesting, but has nothing to do with the Patent Misuse claim -- that's just previews of coming attractions regarding future litigation between these parties completely unrelated to any past alleged patent misuse.

Last week I shared some reasons why Elysium's arguments were no good. And normally, I would assume that would be the end of it, because I was taught in law school that although "Hard cases make bad law," the Courts COULD in fact competently handle easy cases.

This particular court has looked more like a drunken spectator egging on the participants in a cock fight upon which it has placed a wager, rather than a public dispute resolution mechanism of last resort (by which I mean it should have dismissed not only Elysium's Patent Misuse claim but also Eysium's fradulent inducements claim; if any non-contract claim was to have been left standing it should have been ChromaDex's fraud claim), so I am not betting on what happens next.

HOWEVER, With the reply above, Cooley has now provided the official reasons why Elysium is full of shit. ChromaDex's brief sounds cooler-tempered than my arguments, but on the other hand that cool-tempered style packages some pretty hot language. Cooley:

"Elysium makes three fallacious arguments..."

"Elysium is wrong..."

"Elysium engages in a remarkable 'bait-and-switch...'"

"[Elysium's] overly aggressive advocacy is misleading..."

"Elysium is wrong, and it critically misleads the court..."

"Elysium misguides the court..."

"Elysium's distortion and omission is material..."

"Elysium misconstrues a vintage" case...

"Elysium... directly contradicts what it represented to the Court only five months ago..."

"Elysium asks the Court to do exactly what the Supreme Court has expressly held courts may not do..."

If you read the brief, you get to find out exactly which cases cited by Elysium don't actually say what they purport to say, or are taken completely out of context, or specifically rely on facts not present here.

You'll also get to see Cooley set a fun trap for Elysium, when it invites Elysium to admit that it is currently infringing, if it wants to maintain a patent claim:

To demonstrate a case or controversy regarding a potential claim for patent infringement, Elysium would have to establish...that Elysium’s sales actually infringe ChromaDex’s patents...Absent that stated concern over patent infringement, the crucial element is missing..."

But you'll have to do that in the context of learning about the technical requirements of federal jurisdiction. There are probably better ways to spend your time.

Last time out, Cooley made arguments that were perfectly clear, concise, and compelling, with little to show for it. We'll see if this Court once again needs to be hit over the head with a 2x4 to understand the pretty obvious subtext of the controversy before it, or if Cooley has made it clear enough.

Despite the indignant language I quoted above, this brief is sufficiently polite and professional that I won't faint if I learn that the Central District of California is once again prepared, for no clear reason, to go where no Court has gone before.

#ElysiumHealth #ChromaDex #Litigation #CDXC

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