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On the sunny Wednesday after Labor Day in a hotel conference room near Chicago’s O’Hare Airport, a selection committee of lawyers for the nation’s top retailers gathered to decide which of the country’s leading intellectual property law firms would defend them against a massive patent infringement lawsuit. At high noon, three Pillsbury Madison & Sutro lawyers charged into a conference room, brimming with confidence and sass, and beat out the other four contenders to win the jeweled tiara: the opportunity to defend 135 national retail chains in a suit by the Lemelson Foundation that alleges that the retailers’ use of bar-code scanning technology infringes on Lemelson patents. “Some people call them beauty contests, but I call them bake-offs because I’m not very pretty and I win a lot,” said Kenneth Chiate, a partner and trial lawyer in Pillsbury’s Los Angeles office, who will serve as lead counsel along with Washington, D.C., partners Raymond Sweigart and George Sirilla. Naming 135 defendants — including Nordstrom Inc., K-Mart, Rite Aid Corp. and Williams-Sonoma Inc. — Lemelson v. Comp USA alleges that their use of scanning technology that reads bar codes amounts to unlicensed violation of the patents of inventor Jerome Lemelson. Lemelson, who died in 1997, has more patents to his name than anyone but Thomas Edison and Edwin Land, the man who invented the Polaroid camera. Lemelson’s patents have included technology for cordless phones, cassette players and camcorders, automated manufacturing systems and even crying baby dolls. To patent lawyers like Cooley Godward’s C. Scott Talbot, who heads the firm’s patent group from its Reston, Va., office, the name Lemelson is “infamous,” since his foundation and estate over the years have sued dozens of companies for patent infringement and are aggressively pursuing posthumous patents and licensing agreements. San Francisco Bay Area patent and IP lawyers say they’ve advised clients on how to deal with a Lemelson demand letter, which has become a way for the foundation to strike tens of thousands of settlements and licensing agreements with nary a courtroom appearance. Chiate said that if the Lemelson Foundation, represented by Nevada lawyer Gerald Hosier, succeeds with the bar-code lawsuit, the retail industry in America could be slowed to a tempo reminiscent of the days of cash registers with noisy number keys and shiny silver drawer-release handles. Hosier could not be reached on Friday. “If they prove a valid patent in this case, the court could issue an injunction against using the technology,” Chiate said. “They could put a stop to the whole retail industry in this country… it could be devastating.” Specifically, Pillsbury’s defense is relying partially upon a legal doctrine claiming the patent is unenforceable because enough time has gone by between development and litigation. And, they say, because of the delay in acquiring the patent, the public has acquired intervening rights to it. Arguing that the public has relied on the technology long enough to have some wide-scale entitlement to it is a tactic that Chiate thinks will work, and that he also thinks was instrumental in winning the job representing the retailers. Chiate said the retailer’s selection committee, which was composed of general counsel and outside lawyers for a group of the retailer plaintiffs, had originally focused their search on 17 top patent litigation firms. The number then went down to 10, and then to the five that were screened in the Chicago beauty contest. He said he does not know who the other four competing firms were. Chiate said he thinks Pillsbury was chosen partially because of the amicus curiae brief that its lawyers wrote at the behest of the National Retail Federation in support of an appeal that two bar-code scanning equipment manufacturers filed against Lemelson when their attempt to invalidate Lemelson’s patent was denied. Additionally, the Pillsbury trio went into the conference room contest citing the size of their IP practice (between 130 and 140 lawyers), their specific experience advising clients who had received demand letters from Lemelson, and their experience with trial law and litigation. “We thought we had deeper and more trial experience in complex litigation,” said Chiate, who has done litigation for Bank of America, AirTouch and Toshiba. “There’s not more complicated litigation than this [lawsuit].” But Cooley’s Talbot said that experience and expertise are not always the factors that lead to a contest being won by a law firm. “Not to take anything away from Pillsbury, but there’s a lot that goes into these decisions, and it’s not necessarily judged solely on who was best,” said Talbot, who added that he counts Pillsbury as a major player among Northern California firms with “heavy-duty patent litigation capability.” Talbot said that often a client will hold a beauty contest as a way of trying to bargain for fee concessions or a reduced representation cost. “We’ve had opportunities where we’ve been told we were the best but were losing because other people were cheaper,” Talbot said.

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