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“How many times do you have to bang somebody’s head against a brick wall?” patent attorney James A. Gale asked. For the top officers of VitalCare Group Inc., the answer is apparently three-as in three court orders directing the Miami-based medical products maker to stop selling its infringing version of a patented device made by Gale’s client, Palco Labs Inc. On Sept. 15, a federal magistrate recommended that VitalCare’s top officers be jailed for contempt of court until the company complies with the court’s two previous orders. VitalCare Chief Executive Officer Ramzi Abulhaj and Vice President Rick Admani have until Sept. 29 to give Miami U.S. District Court Judge Joan A. Lenard a reason why she should not convert magistrate Andrea M. Simonton’s recommendation into an order to incarcerate. Palco Labs Inc. v. VitalCare Group Inc., No. 01-CV-3480 (S.D. Fla.). Admani and Abulhaj, who are brothers, have hired former U.S. Attorney General Janet Reno’s chief of staff, John M. Hogan, to defend them. For 19 years, Hogan worked as a federal prosecutor in the Southern District of Florida. Now a partner at Holland & Knight, he is the third attorney to represent the VitalCare defendants since the case’s inception two years ago. “We’re going to do everything we can to comply with the court’s order,” he said. Gale, a partner in Miami’s Feldman Gale & Weber, said the brothers’ dilemma is in large part their own doing. He attributed it to a combination of poor counseling and the defendants’ belief that they can get out of anything. “They’re incorrigible,” he said. Attorneys not involved in the case said jailing defendants in such a case is highly unusual. “Typically, the only time you’re really in danger of criminal contempt in the American legal system is when a judge has looked you in the eye and said, ‘Don’t do it,’ and you’ve done it,” said Charles R. Work, a partner at Chicago-based McDermott, Will & Emery and a former assistant U.S. attorney. “In the context of all civil litigation, it’s very rare.” Marketing a ‘cheap knockoff’ Gale’s client is the creator of the Auto-Lancet, a stylus-like blood sampling device used by diabetics. The device features an adjustable tip that allows a user to vary the puncture depth in accordance with the toughness of the skin from which the blood is being drawn. Three years ago, Palco discovered that VitalCare was marketing what Gale called a “cheap knockoff” of its product. He said Palco learned of the infringement when complaints began to accrue over lancets that failed to work properly-lancets that Palco discovered were not their own. In August 2001, Palco filed suit. Ten months later, VitalCare, then represented by Miami lawyer Robert C. Kain Jr., settled the case. In a court-ordered consent decree, the defendants conceded the infringement, agreed to pay Palco $100,000 and also agreed to make changes to their lancet and its packaging so that it is more readily distinguishable from Palco’s patented product. Gale said that his clients weren’t looking for a massive payout, they just wanted the infringing behavior to stop. It didn’t stop. Instead, breaking with Kain over an unpaid bill that, he said, is in the “tens of thousands of dollars,” the brothers retained 78-year-old lawyer Jack E. Dominick, who filed a new suit collaterally attacking the old consent decree. Gale responded with a motion seeking dismissal and Rule 11 sanctions against VitalCare and Dominick. But before that motion could be decided, Dominick suffered a career-ending heart attack. Acting in his stead, Dominick’s attorney-daughter, Elizabeth, negotiated his withdrawal from what became known as Palco II, but the motion for sanctions remained. Simonton’s Sept. 15 order also recommended dismissal of the later-filed action. The magistrate concluded that any issues raised therein should and could have been raised in conjunction with Palco I. Asked how long he thought it would take the defendants to clean up their act, Gale answered, “It may take a little while . . . hopefully not before they go to jail.” Noting VitalCare’s national and international distribution, he added, “It’s a lot of product to get off the shelves.” Hogan said, however, that his clients intended to report to the court that they had cured the contempt before their time to contest the magistrate’s order had expired. Calling it a “once in a career” case, Gale said, “The judge did what was right. You never really know whether the judge has the guts to make a call like that.” Paul Molino, a partner at Chicago’s Lord, Bissell & Brook, said that if the judge actually orders the defendants to jail, it could be a first. “I’ve never heard of a criminal contempt proceeding in a patent case or anything even close,” Molino said. “Even civil contempt is rare. These cases aren’t that exciting.” Harris’ e-mail address is [email protected].

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