Molten’s Defense Dribbles Off Foot, Loses $8 Million

Posted on | March 20, 2008 | No Comments

2008-1216 Baden Sports v. Molten

WD/WA 06-cv-210

Molten appeals from Judge Marsha Pechman’s denial of its motions for new trial and JMOL following a $8+ million jury verdict (and permanent injunction) against it for infringement (5,636,835) and false advertising. 

Baden and Molten are competitors, and Molten’s advertised its cushioned ball as “innovative technology that is proprietary to Molten.”  After a week long trial, the jury awarded $38,031 in patent infringement damages and over $8 million under the Lanham Act claim.  Many of Molten’s key witnesses and evidence was excluded from trial because the court concluded that Molten did not identify in a timely fashion.  Further, several of the matters raised in the motion (filed by new, post-trial counsel) were deemed waived for failure to move for a directed verdict on these issues. 

The major issue preserved and addressed the JMOL is whether Baden’s false advertising claim is barred by Dastar Corp. v. Twentieth Century Fox Film Corp., where the Supreme Court held that a false advertising claim under the Lanham Act cannot be based on inventorship or ownership.  Molten argued that Baden’s claim was exactly that: if the basketballs infringed Baden’s patent then the balls were “innovative,” albeit not “proprietary” to Molten.  Molten also argued that phrase was “puffery.”  The court found the “puffery” argument not preserved, and further found that the statements were directed to the “nature, characteristics [or] qualities” of the basketballs rather than to inventorship.

As to the false advertising damages, while the court noted that Molten’s profits on sales of the basketballs was only about $66,000, plaintiff’s experts opined that the "profits from the false advertising" could be measured by the amount Molten paid for its recent sponsorship agreements with FIBA and USA Basketball, the present value of which was calculated at about $8 million, the exact amount of the jury award.  Although Molten’s experts disputed such measurements, the court found the award was not against the clear weight of the evidence.

UPDATE: Baden Sports has filed a cross appeal, 2008-1246 related to remedies (not getting enough) and a partial summary judgment Molten obtained on parts of Baden Sport’s Lanham Act claims.

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