Case 4:13-cv-00342-KGB Document 12 Filed 08/16/13 Page 1 of 13

IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF ARKANSAS

P. S. PRODUCTS, INC., and BILLY PENNINGTON, Individually

PLAINTIFFS

v.

Civil Action No. 4:13-cv-342-KGB

ACTIVISION BLIZZARD, INC., ACTIVISION PUBLISHING, INC., and TREYARCH CORPORATION.

DEFENDANTS

PLAINTIFFS RESPONSE TO DEFENDANTS MOTION TO DISMISS I. Introduction and Facts

The Plaintiff is the legal owner of patents for a product known as Blast Knuckle Stun Gun, patent No. US D561,294 S and patent No. US D576,246 S. Please see Exhibit A to the Dkt. No. 1. On February 5, 2008, United States Letters Patent No. US D561, 294 S, (hereafter US D561, 294 S) was issued to the Plaintiffs for a design invention for a stun gun. The Plaintiffs have owned the patent No. US D561, 294 S throughout the period of the Defendants infringing acts and still owns the patent. The Plaintiffs product, the Zap Blast Knuckle embodies the US D561, 294 S design patent. When the Zap Blast Knuckle is operated by a user it produces a 950,000 volt electrical shock. A user holds the Zap Blast Knuckle as if holding a pair of brass knuckles.

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The Plaintiff specializes in the manufacture and distribution of stun guns, gun cleaning kits, and other personal protection devices. The Plaintiff markets and sales this device through trade specialty shows throughout the United States, as well as through internet distribution. Its clients include: Gander Mountain, Cableas, National Rifle Association, Bass Pro Shop, Academy and The Sportsmans Guide. This patented product did not exist anywhere in the world until it was designed, patented and placed in the stream of commerce by the Plaintiffs. There is no prior art to the Plaintiffs patent. In 2009, it was the Plaintiffs top selling product and it has continued to produce significant revenue. On information and belief the Plaintiffs learned that the Defendants video game, Call of Duty, Black Ops II, for platforms, Xbox, PlayStation 3, Wii and MICROSOFT WINDOWS, contain illegal images that embody the Plaintiffs US D561, 294 S patent design. In the video game Call of Duty, Black Ops II on and in all platforms a player, via an avatar, may access weapons called the Combat Suppression Knuckles or Galvaknuckles via icons that are illegal images that embody the Plaintiffs US D561, 294 S patent design. Additionally, the weapons, Combat Suppression Knuckles or Galvaknuckles, that a player may access through the icons are an illegal copy of the Plaintiffs US D561, 294 S patent design.1

1 The image above is one of the icons player use to access the stun device the Defendants video games

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In the video game Call of Duty, Black Ops II when a player via an avatar, uses the weapons called Combat Suppression Knuckles or Galvaknuckles it emits an electrical shock representing in reality the shock volts produced by the Plaintiffs product Zap Blast Knuckle that embodies the Plaintiffs US D561, 294 S patent design.

In the campaign mode of Call of Duty, Black Ops II, these knuckles appear in the levels Karma and Odysseus. In the campaign mode of Call of Duty, Black Ops II, a player may use the access kit perk on these levels, an icon will appear indicating there is a weapons cache available. After opening the case, the player will immediately see illegal images that embody the Plaintiffs US D561, 294 S patent design. The Combat Suppression Knuckles also appear in the strike force portions of the campaign. Galvaknuckles must be purchased in zombie mode. In the game play a player may acquire the Galvaknuckles by an access through icons that are an illegal copy of the Plaintiffs product Zap Blast Knuckle that embodies the Plaintiffs US D561, 294 S patent design. The icons that are an illegal copy of the Plaintiffs product Zap Blast Knuckle that embodies the Plaintiffs US D561, 294 S patent design are found in each of the zombie levels: Tranzit, Farm, Town, Nuketown Zombies, and Die Rise. The Defendants without authority placed in the stream of commerce and offered to sell, the video game Call of Duty, Black Ops II 3

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which uses illegal images that embody the Plaintiffs US D561, 294 S patent design at retail locations and on the world wide web throughout the United States. The Defendants acts are likely to cause confusion, mistake or deception among purchasers and potential purchasers of the video games bearing the illegal copies of the Plaintiffs design. Purchasers and potential purchasers are likely to believe that illegal images in the Defendants video game originate from, or are in some way properly connected with, approved, sponsored and endorsed by the Plaintiffs. II. Fed. R. Civ. P. 12 (b)(6) Legal Standard

A motion to dismiss under Rule 12(b)(6) should be granted when a plaintiff fails to state a claim upon which relief can be granted. Dismissal should be granted only when the factual allegations contained in the complaint fail to state a claim to relief that is plausible on its face. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 1974, 167 L.Ed.2d 929 (2007), or when an issue of law is dispositive. Neitzke v. Williams, 490 U.S. 319, 326, 109 S.Ct. 1827, 104 L.Ed.2d 338 (1989). In evaluating the complaint, only its legal sufficiency may be considered, not the weight of the evidence supporting it. Leatherman v. Tarrant County Narcotics Intelligence & Coordination Unit, 507 U.S. 163, 164, 113 S.Ct. 1160, 122 L.Ed.2d 517 (1993). Furthermore, the court must accept as true all factual allegations, even if doubtful. Bell Atlantic, 550 U.S. at 555. Rule 12(b)(6) explicitly provides, that if the Court in ruling on the motion takes into consideration matters outside the pleadings, it must treat the motion as one for summary judgment under Rule 56. If both parties file affidavits and exhibits in support of their respective positions, which are not excluded by the District Court, the motion to dismiss should properly be treated as one for summary judgment. Costen v. Pauline's Sportswear, Inc., 391 F.2d 81, 85 (9th 4

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Cir. 1968); Central Contracting Co. v. Maryland Casualty Co., 367 F.2d 341, 343 (3rd Cir. 1966); Smith v. United States, 362 F.2d 366, 367-368 (9th Cir. 1966). Considering the motion therefore as one for summary judgment the crucial question is whether this case presents a genuine issue as to some material fact. Unless the pleadings and supporting documents disclose beyond any doubt the absence of a genuine issue of fact, summary judgment should not be entered. Poller v. Columbia Broadcasting System, Inc., 36 U.S. 464, 467, 82 S. Ct. 486, 7 L. Ed. 2d 458 (1962); Vineberg v. Brunswick Corporation, 391 F.2d 184, 187 (5th Cir. 1968); Williams v. Chick, 373 F.2d 330, 331-332 (8th Cir. 1967); Kennedy v. Bennett, 261 F.2d 20, 22 (8th Cir. 1958); Booth v. Barber Transportation Co., 256 F.2d 927, 928 (8th Cir. 1958). III. Fed. R. Civ. P. 12 (b)(6) Legal Standard in Patent Infringement Matters is Broad

In a patent suit, a motion to dismiss a complaint should not be granted if from the record before the Court it is impossible to appraise the claims or to determine their scope or range of equivalents of their elements. Karl Kiefer Mach. Co., v. United States Bottlers Machinery Co., 113 F2d 356, 46 USPQ 1 (1940, CA7 Ill). In patent cases the Courts assume as true all factual allegations of a Complaint. To survive a motion to dismiss the complaint must allege only enough facts to state a claim to relief that is plausible on its face. B&B Hardware, Inc. v. Hargis Indus., 569 F.3d 383, 387, 2009 U.S. App. LEXIS 8. (8th Cir. Ark. 2009). Federal Civil Procedure Rule 12(b)(6) pleading requirements for a Complaint alleging patent infringement cannot be extended to require a plaintiff to specifically include each element of claims of asserted patent, since imposing such requirements would contravene the notice pleading standard, and thus, the patentee is only required to plead facts sufficient to place the v

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alleged infringer on notice. Phonometrics, Inc., v. Hospitality Franchise Sys., 203 F3d 790, 53 USPQ2d 1762 (2000, CA FC). IV. Design Patents use Are Not Limited to an Article of Manufacture and Design Patents Are Granted to Computer Icons

Patent holders have exclusive rights. The exclusive rights are disjunctive: one may infringe by (1) making without selling or using, (2) using without making or selling or (3) selling without making or using. Roche Products, Inc. v. Bolar Pharmaceutical Co., Inc., 733 F.2d 858, 861 (Fed. Cir. 1984) , cert. denied, 469 U.S. 856 (1984) ("It is beyond argument that performance of only one of the three enumerated activities is patent infringement."). Design patent infringement adheres to the ordinary observer test and the use of prior art. Please see Egyptian Goddess v. Swisa, 543 F. 3d 665 (Fed. Cir. 2008). The ordinary observer test was recently broadened in the landmark Apple v. Samsung case. Please see Apple, Inc. v. Samsung Elecs. Co., 2012 U.S. Dist. LEXIS 105125 (N.D. Cal. July 27, 2012); Northern District Case No. 11-cv-1846). One does not escape infringement by using a patented invention for a purpose not contemplated or disclosed by the patentee. See Paragon Solutions, LLC v. Timex Corp., 566 F.3d 1075, 1091 (Fed. Cir. 2009) [A]pparatus claims cover what a device is, not what a device does. Hewlett-Packard Co. v. Bausch & Lomb, Inc., 909 F.2d 1464, 1468 (Fed. Cir. 1990). "Absent an express limitation to the contrary, any use of a device that meets all of the limitations of an apparatus claim written in structural terms infringes that apparatus claim. See, e.g., Catalina Mktg. Int'l, Inc. v. Coolsavings.com, Inc., 289 F.3d 801, 809 (Fed. Cir. 2002) (holding that 'a patent grants the right to exclude others from making, using, selling, offering to sale, or importing the claimed apparatus or composition for any use of that apparatus

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or composition' (emphasis added)). "Even if an [accused infringer practiced a patented method] for an entirely different reason [from that recited in the patent], that would not avoid infringement as the motive of the accused infringer when performing a claimed method is simply not relevant. Hilton Davis Chem. Co. v. Warner-Jenkinson Co., 62 F.3d 1512, 1519 (Fed. Cir. 1995) (en banc), rev'd on other grounds, 520 U.S. 17 (1997) ."; "The statement in a claim that the method is intended to serve a particular purpose at most requires that the undesirable result (here destructive thermal stresses) be avoided. Such a statement does not give rise to a defense to infringement by showing that practicing the claimed method was not necessary to achieve that purpose. Catalina Marketing International, Inc. v. Coolsavings.com, Inc., 289 F.3d 801, 809, 62 USPQ2d 1781 (Fed. Cir. 2002). "A patent grants the right to exclude others from making, using, selling, offering to sale, or importing the claimed apparatus or composition for any use of that apparatus or composition, whether or not the patentee envisioned such use." Union Oil Co. of California v. Atlantic Richfield Co., 208 F.3d 989, 995, 54 USPQ2d 1227, 1231 (Fed. Cir. 2000) , cert. denied, 531 U.S. 1183 (2001) ("The scope of [a patent's] composition claims cannot ... embrace only certain uses of that composition. See In re Spada, 911 F.2d 705, 708, 15 USPQ2d 1655, 1657 (Fed. Cir. 1990) . Otherwise [the] composition claims would mutate into method claims."; "[a] district court correctly applied this principle, refusing to narrow the scope of the claimed compositions to specific uses."). Design patents may be obtained on computer generated images and computer icons. Guidelines are codified for the USTPO to grant design patents on computer generated icons and images. Please see, Department of Commerce, Patent and Trademark Office, "Guidelines for Examination of Design Patent Applications for Computer-Generated Icons," 61 Fed. Reg. 11380 7

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(March 20, 1996) . Subsequently, the PTO incorporated the guidelines in the MPEP. See U.S. Patent & Trademark Office, Manual of Patent Examining Procedure 1504.01(a) (7th ed. July 1998). The PTO set forth similar guidelines in the MPEP. U.S. Patent & Trademark Office, Manual of Patent Examining Procedure 1504.01(a) (8th ed. rev. Oct. 2005). To a comment suggesting that "the language in the guidelines be amended to clarify that the guidelines satisfy the 'design for an article of manufacture' requirement of 35 U.S.C. 171," the PTO noted: "Computer-generated icons are designs within the meaning of 35 U.S.C. 171, but must be embodied in an article of manufacture to satisfy the statute. These guidelines are directed to determining whether the icon is embodied in an article of manufacture, not whether it is a design." 61 Fed. Reg. at 11381. "A patent claim may encompass uses not anticipated by the inventor and therefore not described in the patent. See Infigen, Inc. v. Advanced Cell Technology, Inc., 65 F. Supp. 2d 967, 975 (W.D. Wis. 1999). A patent applicant is not required to describe in specification every conceivable future embodiment of invention." See SRI Int'l v. Matsushita Electric Corp., 775 F.2d 1107, 1121 (Fed. Cir. 1985). "One may not escape infringement by merely taking the claimed structure and using it in a way that differs from the description contained in the preferred embodiment." See American Standard Inc. v. Pfizer Inc., 722 F. Supp. 86, 105 n.10, 14 USPQ2d 1673, 1687 n.10 (D. Del. 1989). "A patentee's invention ... is not necessarily limited by his own misconception of its theory of operation." See Micro Motion Inc. v. Exac Corp., 741 F. Supp. 1426, 1441, 16 USPQ2d 1001, 1014 (N.D. Calif. 1990). The Plaintiffs design patent is for a stun device. The Defendants are using the design of the Plaintiffs design patent at a computer image and icon in a video game for a stun device.

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Simply because the Plaintiff did not obtain a design patent for a computer icon or image doesnt permit the Defendants to infringe on the Plaintiffs design patent. The Plaintiffs could not have anticipated that their design patent would be used in such a way. However, this does not prohibit the Plaintiffs from enforcing their exclusive rights to protect its patent. Additionally, if applied for the Plaintiffs would be been granted a design patent on the computer image and icon of the design. The Defendants should be enjoined from infringing on the said design. To the ordinary observer one would believe the Defendants icon is related to connected and licensed by the Plaintiffs. The Plaintiffs learned of the infringing images from contacts all of the United States. These users associated the infringing images with the Plaintiffs design patent. The Plaintiffs patent is unique and is the sole inventor of the concept and design. A side by side comparison along with the evidence of no prior art, other than the Plaintiffs invention, reveals that the Defendants have infringed on the Plaintiffs design. The Plaintiffs have met their burden of pleading sufficient facts to move forward in the litigation.

2 Plaintiffs original prior art of the design patent for a stun device

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VI.

Hewlett-Packard, Hard Rock Caf, Napster, MGM, and Ebay Cases Support Plaintiffs Cause of Action of Patent Infringement

In Hewlett-Packard Co., v. Bausch & Lomb, Inc., 909 F.2d 1464, 15 USPQ2d (BNA) 1525 (1990), the Court discussed the question of what level of knowledge or intent is required to find active inducement under 271(b). The Court stated that 35 U.S.C 271(b) is much broader than 271 (c) and certainly does not speak of any intent requirement to prove active inducement. But, proof of intent must be proved by at least circumstantial evidence. Id. at 1469. The Court looked at the totality of the circumstances to determine whether induced infringement occurred in the case. Id. From the outset a reader of the Hard Rock Caf Licensing Corporation v. Concession Services Incorporated, 955 F.2d 1143, 21 USPQ2d (BNA) 1764 (1992), will see that the case resolves around trademark infringement. However, the case is often cited in patent infringement cases and cites patent infringement cases. Furthermore, the facts of the case are directly on point to the facts in the present matter. The general facts of the case revolve around Hard Rock Caf pursuing companies for selling illegal copies of Hard Rock Caf t-shirts at flea markets and retail locations. The Defendant CSI operated flea markets whereby vendors would buy space to sell merchandise. CSI sold a space at a flea market to a vendor, Parvez. The vendor, Parvez, sold illegal copies of Hark Rock Caf t-shirts. Hard Rock Caf did not sue the vendor, Parvez, they sued the

company, CSI, who sold the flea market space to the vendors. CSI did not have knowledge that Parvez was selling illegal copies of Hard Rock Cafs t-shirts. CSI had very little supervision of the flea markets. Additionally, at no point before filing the lawsuit did Hard Rock Caf notify CSI of the illegal t-shirts. The main issue the Court discussed was whether CSI could be

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contributorily liable for Parvezs trademark infringement. The Court held that they were liable for trademark infringement. Id. at 1149. In A & M Records, Inc., v. Napster, Inc., 239 F.3d 1004, (9th Cir. 2001), the Court held that software created and hosted by Napster violated copyright laws. Napster hosted a website whereby individuals transferred and stored files via peer-to-peer file sharing. The individuals were actually the party copying and placing the content on Napsters website but, the Plaintiffs sued Napster, who hosted the website. The content being copied was the subject of the Courts analysis. Plaintiffs claimed that Napster users are engaged in the wholesale reproduction and distribution of copyrighted works, all constituting direct copyright infringement and that Napster was a contributory infringer. The district court agreed. The Ninth Circuit affirmed. In MGM v. Grokster, 545 U.S. 913, 125 S. Ct. 2764 (2005), the Court discussed whether a distributor of a product is liable for acts of infringement by third parties who illegally use the product. This case addressed a peer-to-peer network created by the Defendants whereby its users could share electronic files. The Defendants in the case were sued for copyright infringement by MGM. The users of the Defendants network were transferring movies electronically over the network. (Although this case is a copyright infringement case it discusses patent infringement and cites patent infringement cases.) Again, as in the Hard Rock and Napster cases the Plaintiffs did not sue the users. The Plaintiffs sued the third party, Grokster, who provided the access to the infringement. The Court stated, one who distributes a device with the object of promoting its use to infringe copyright. . . .is liable for the resulting acts of infringement by third parties. Id. at 918. In discussing patent infringement the Court went on to say, The classic case of direct evidence of unlawful purpose occurs when one induces the commission of infringement by

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another, or entices or persuades another to infringe. . . . as by advertising. Id. at 935. The Court in this case held that the Defendant was liable as a contributory infringer based on the inducement rule founded in patent law. Id. at 936. The Court stated, the inducement rule, too, is a sensible one for copyright, as shown by clear expression or affirmative steps taken to foster infringement by third parties. Id. at 937. VII. Conclusion

WHEREFORE, the Court should find that the Plaintiffs have stated facts to support its claims for patent infringement and that the matter shouldnt be dismissed. Additionally, the Plaintiffs filed a Motion for Leave to file an amended complaint on August 15, 2013 to included claims for unfair competition, violation of the deceptive trade practice act and common law trademark infringement. Dated: August 16, 2013 STEWART LAW FIRM /s/ Chris H. Stewart By: Chris H. Stewart Ark. Bar No. 03-222 Attorney for Plaintiffs 904 Garland Street Little Rock, AR 72201 Phone: 501-353-1364 Fax: 501-353-1263 Email: arklaw@comcast.net Attorney for Plaintiffs, Billy Pennington and P.S. Products, Inc.

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CERTIFICATE OF SERVICE I, the undersigned, hereby certify that the foregoing was electronically filed with the Clerk which shall send notification of such filing to the following: Richard Glasgow bglasgow@wlj.com

On this 16th day of August, 2013.

By: /s/ Chris H. Stewart Chris H. Stewart

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