Lemelson Medical Education & Research Foundation, L.P. v. Esco Electronics Corp., et. al.
Lan Kennedy-Davis represented Recoton Corporation, a named defendant in this action as in-house counsel. Plaintiff had filed hundreds of lawsuits nationwide, which alleged that their bar code patents were being infringed. They had pressured numerous defendants to pay approximately $1.5 billion in settlement at the time Recoton and approximately 90 members of the EIA were sued in the U.S. District Court for the District of Arizona. Lan Kennedy-Davis discovered another case wherein interested companies joined to file an action for declaratory judgment that the Lemelson patents were invalid, unenforceable and not infringed due to prosecution laches. In that case, the district court dismissed the laches claim and the case was then pending in the U.S. Court of Appeals. Lemelson sought injunctive relief when Recoton refused to pay $5 million for Lemelson’s claim for alleged past infringement and a continuing payment of royalties for future use. Lan Kennedy-Davis worked with outside counsel to obtain an order staying the case while the appeal was pending. In 2004, this issue came to a bench trial verdict in the leading case that the Lemelson patents were invalid and unenforceable. The other defendants, who had settled and agreed to pay Lemelson past and future royalties, were required to continue to pay because it was a voluntary contractual obligation, which Recoton was able to avoid due to the stay obtained and ultimately the dismissal of the case against Recoton.