March 20, 2008

Callaway Awaits Judge's Decision

The dizzying back and forth in the resolution of the Callaway-Acushnet patent infringement lawsuit over the most popular ball in golf, the Pro V1 from Acushnet brand Titleist, has finally reached a climax. All that's left is a judge's decision, and that could come within the next month.

On Thursday, Callaway lawyers filed their final brief in U.S. District Court in Delaware in response to Acushnet's earlier motion to disallow Callaway's request for a permanent injunction against the sale of the Pro V1. What remains in question is how district judge Sue L. Robinson will rule, given that a review by the U.S. Patent and Trademark Office of the patents in question has determined them to be invalid, a direct contradiction to the result of the jury trial.

Callaway's latest brief summarily dismisses the U.S. PTO's decisions. "Callaway Golf has explained, multiple times, that the PTO simply views the claims in the broadest manner and makes no effort to conduct a balanced and proper assessment either of the scope of the patent claims or of all the evidence that bears on their validity. The PTO's assessment, therefore, has no bearing at all upon the claims as properly construed by the Court and does not undermine either the Court's substantive decisions or the verdicts of the jury."

In its motion in opposition to Callaway's request for permanent injunction, Acushnet noted that the PTO had twice reviewed Callaway's patents in question and found them invalid. In their brief, Acushnet lawyers also maintained that Callaway did not suffer irreparable harm, is not entitled to an injunction and never used the patents in question. According to the Acushnet brief, which was filed in late February, "[Callaway] bought the patents in a bankruptcy auction, it does not use them and it filed this case to collect money."

But Callaway's latest brief gets just as chippy, accusing Acushnet of misleading the public "to create the impression that it produced the Pro V1 before the patents in suit were even filed," a statement it says Acushnet has previously conceded is not true. Callaway says a permanent injunction is the only recourse it has.

"It is Acushnet's willingness to repeatedly mislead the public about the facts of this case, the Court's rulings, and the law, that further support entry of an injunction," Callaway's latest brief reads. "Because history, including very recent history, has shown that unless an injunction [is issued] outlining exactly what Acushnet can and cannot do, Acushnet will disregard the rights of others and mislead the public in the process."

The lawsuit went to trial last November, and a jury subsequently ruled in favor of Callaway's contention that golf ball patents it owned were valid and thus were infringed by the Pro V1. Callaway then requested a permanent injunction against the future sale and distribution of the Pro V1, effective the date of the judge's ruling. Acushnet lawyers responded by detailing, among other things, that recent actions by the U.S. Patent and Trademark Office invalidating the patents-in-question -- information not allowed at the trial -- now invalidates the original jury verdict. Therefore, Callaway's request for permanent injunction should be delayed until the Court resolves the discrepancy between the PTO's rulings and the trial verdict. Acushnet lawyers also suggest that "Callaway's motion (for permanent injunction) simply assumes, without proving, that there is even a likelihood, with sales of the infringing Pro V1 golf balls enjoined, that Callaway will catapult to the 'leadership' position it claims or that Callaway's 'reputation for innovation' will be restored." They state further, "Callaway would clearly not become the exclusive or dominant provider of premium golf balls in the absence of Titleist's Pro V1."

David Dawsey, a patent attorney whose website golf-patents.com has covered the filings in the case, believes a decision could come by the middle of April.

"Federal judges work at their own pace and don't really answer to anyone," Dawsey said. "That said, the judge in this case seems to move things along quite well."

Of course, one element hangs above the ongoing diatribe: Regardless of the outcome of these proceedings, Titleist most likely will be issuing a new premium tour ball by the first quarter of 2009, with perhaps an even earlier debut on the professional tours. What's that Shakespeare said about a tale full of sound and fury signifying nothing?

Stay tuned.