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)
SOLPALS, LLC, a Utah corporation, and )
C-SLIDE HOLDINGS, LLC, a Utah ) Civil Action No. 2:18-00241-PMW
corporation )
)
Plaintiffs, )
) COMPLAINT
v. )
) DEMAND FOR JURY TRIAL
HANDSTANDS PROMO, LLC, a Utah )
corporation, ) Judge Paul M. Warner
)
Defendant. )
)
Plaintiffs SolPals, LLC (“SolPals”) and C-Slide Holdings, LLC (“C-Slide”) (collectively,
“Plaintiffs”), complain and allege against Defendant HandStands Promo, LLC (“HandStands”) as
follows:
THE PARTIES
1. SolPals is a limited liability company organized and existing under the laws of the
state of Utah, with a principal place of business at 1192 Draper Parkway, Ste. 202, Draper, Utah,
84020.
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 2 of 47
2. C-Slide is a limited liability company organized and existing under the laws of the
state of Utah, with a principal place of business at 1192 Draper Parkway Ste. 202, Draper, Utah,
84020.
3. HandStands is a limited liability corporation organized and existing under the laws
of the state of Utah, having a principal place of business at 40 South Preston, Alpine, Utah, 84004.
JURISDICTION
4. This action arises in part under the patent laws of the United States, including 35
U.S.C. § 271, which gives rise to the remedies specified under 35 U.S.C. §§ 281, 283, 284, and
285.
5. Subject matter jurisdiction of this Court over this Action is founded upon 28 U.S.C.
corporation.
VENUE
7. In light of the matters set forth above, venue of this Action is proper in this judicial
8. Various ornamental aspects of the C-Slide Webcam Covers are protected by U.S.
Pat. Nos. D782,562 (“the ’562 patent”) and D669,112 (“the ’112 patent”). Copies of the ’562
patent and ’112 patent are attached as Exhibits A and B, respectively. C-Slide is the owner by
assignment of all right, title, and interest in and to the ’562 patent and the ’112 patent.
9. The C-Slide Webcam Covers, which include the C-Slide 3.0 covers, have been
extremely successful and well received by consumers. SolPals has sold thousands of the C-Slide
2
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Webcam Covers to various distributors across the country, who have in turn sold them to thousands
10. In contrast to other webcam covers, the C-Slide Webcam Covers include unique
and highly recognizable design features that are not found elsewhere in the webcam cover market.
The unique nature of this design feature is corroborated, for example, by the United States Patent
and Trademark Office finding that the claimed designs of the ’562 patent and the ’112 patent are
new and not obvious and issuing the ’562 patent and the ’112 patent.
11. The C-Slide Webcam Covers are further known among consumers for their unique
product packaging. Where other companies that market promotional products distribute their
products in simple plastic bags, Plaintiffs distribute their products using blister packaging and a 4
NDA”) wherein each party covenanted not to use the other party’s confidential information outside
15. After executing the NDA, SolPals shared confidential information with
3
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16. SolPals ultimately rejected HandStands’ offer and accepted an offer from a third
party. Following its acquisition by the third party, SolPals created C-Slide Holdings, LLC, and
assigned all its rights and interests in certain intellectual property, including the ’562 patent, to C-
Slide.
17. Soon afterwards, Plaintiffs discovered that Defendant had begun marketing and
selling a webcam cover called “Private Eyes” (“the Accused Product”) that copies ornamental
features found in the C-Slide Webcam Covers and claimed in the ’562 patent. Defendant
advertises, sells, and/or offers for sale the Accused Product through its website
18. The Accused Product includes design features that are substantially the same as the
claimed subject matter of the ’562 patent, as illustrated in the example below:
4
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19. As demonstrated above, the design of the Accused Product is substantially the same
as the claim of the ’562 patent such that an ordinary observer purchasing an Accused Product
20. The Accused Product also includes design features that are substantially the same
as the claimed subject matter of the ’112 patent, as illustrated in the example below:
21. As demonstrated above, the design of the Accused Product is substantially the same
as the claim of the ’112 patent such that an ordinary observer purchasing an Accused Product
22. Defendant has engaged in an extensive campaign to sell and/or offer to sell the
Accused Product in competition with the C-Slide Webcam Covers, and in violation of the ’562
23. Furthermore, Defendant’s manner and methods for packaging and marketing the
Accused Product mirror methods that had been shared with Defendant as Confidential Information
24. Defendant distributes its products in packaging that mirrors SolPals’ distinctive
packaging, including the blister packaging and a 4 x 6 custom insert card, as shown in the example
below:
5
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25. The similarities between Defendant’s packaging and SolPals’ packaging is such
that consumers are likely to believe, erroneously, that Defendant’s products are associated with
SolPals.
26. Accordingly, on March 13, 2018, SolPals, by and through its counsel, sent a letter
to Defendant informing Defendant that the Accused Product infringes the claim of the ’562 patent
and the claim of the ’112 patent, that Defendant is violating the NDA by using information
regarding SolPals’ business methods and practices, and that Defendant’s packaging violates
SolPals’ trade dress, and demanding that Defendant cease and desist in its continued infringement
of the ’562 patent and the ’112 patent, infringement of the SolPals trade dress, and breach of the
27. Upon information and belief, despite Defendant’s knowledge that the Accused
Product infringes the claim of the ’562 patent and the claim of the ’112 patent, Defendant continues
to manufacture, use, import, export, offer to sell and/or sell the Accused Product. A copy of
6
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COUNT I
PATENT INFRINGEMENT – THE ’562 PATENT
(35 U.S.C. § 271)
29. Plaintiffs repeat and incorporate by reference the allegations set forth above as
30. C-Slide is the exclusive owner by assignment of all right, title, and interest in and to
the ’562 patent. The ’562 patent is duly and properly issued by the U.S. Patent and Trademark
31. The Accused Product includes design features that are substantially the same as the
ornamental design claimed in the ’562 patent to an ordinary observer giving such attention as a
purchaser usually gives, such that an ordinary observer would be deceived into purchasing the
Accused Product believing that the patented product had been purchased.
32. Defendant has infringed and continues to infringe the claim of the ’562 patent by
importing, making, using, selling and/or offering to sell the Accused Product, and Defendant will
34. Defendant’s activities constitute infringement of the ’562 patent without authority
or license from C-Slide and in violation of C-Slide’s rights pursuant to 35 U.S.C. § 271.
35. Defendant’s infringement of the ’562 patent has caused irreparable injury to C-Slide,
entitling C-Slide to preliminary and permanent injunctive relief under 35 U.S.C. § 283.
compensate for the infringement, but in no event less than a reasonable royalty for the use made of
7
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37. Alternatively, C-Slide is entitled to recovery of Defendant’s total profits from its
COUNT II
PATENT INFRINGEMENT – THE ’112 PATENT
(35 U.S.C. § 271)
38. Plaintiffs repeat and incorporate by reference the allegations set forth above as
39. C-Slide is the exclusive owner by assignment of all right, title, and interest in and to
the ’112 patent. The ’112 patent is duly and properly issued by the U.S. Patent and Trademark
40. The Accused Product includes design features that are substantially the same as the
ornamental design claimed in the ’112 patent to an ordinary observer giving such attention as a
purchaser usually gives, such that an ordinary observer would be deceived into purchasing the
Accused Product believing that the patented product had been purchased.
41. Defendant has infringed and continues to infringe the claim of the ’112 patent by
importing, making, using, selling and/or offering to sell the Accused Product, and Defendant will
43. Defendant’s activities constitute infringement of the ’112 patent without authority
or license from C-Slide and in violation of C-Slide’s rights pursuant to 35 U.S.C. § 271.
44. Defendant’s infringement of the ’112 patent has caused irreparable injury to C-Slide,
entitling C-Slide to preliminary and permanent injunctive relief under 35 U.S.C. § 283.
8
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 9 of 47
compensate for the infringement, but in no event less than a reasonable royalty for the use made of
46. Alternatively, C-Slide is entitled to recovery of Defendant’s total profits from its
COUNT III
Trade Dress Infringement
47. Plaintiffs repeat and incorporate by reference the allegations set forth above as
48. SolPals owns all common law rights in its unique product packaging, including use
of blister packaging and an insert card. Because of SolPals’ extensive marketing of its products
using its unique product packaging, the consuming public has come to associate the product
49. Defendant has marketed and sold the Accused Product in association with product
50. Defendant’s concurrent marketing and sale of the Accused Product is likely to
51. Defendant’s conduct constitutes an attempt to trade on the goodwill and reputation
52. By its conduct, Defendant has caused SolPals irreparable harm, damage, and injury
to the value and goodwill SolPals has built in its trade dress and goodwill in its reputation and
business.
53. Defendant will continue to commit the acts complained of in this Complaint unless
9
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 10 of 47
COUNT IV
Breach of Contract
54. Plaintiffs repeat and incorporate by reference the allegations set forth above as
55. SolPals and HandStands executed the NDA on August 21, 2017.
56. Section I.c. of the NDA prohibits HandStands from using any Confidential
Information disclosed to it by SolPals for HandStands’ own use or for any purpose other than
information…or data of a financial, business, or technical nature, including but not limited to
58. Under the auspices of the NDA, SolPals disclosed confidential information
information to market and sell the Accused Products, in violation of the NDA.
60. By its conduct, Defendant has caused SolPals irreparable harm, damage, and injury
to the value and goodwill SolPals has built in its trade dress and goodwill in its reputation and
business.
61. Defendant will continue to commit the acts complained of in this Complaint unless
JURY DEMAND
62. Plaintiffs demand a jury trial on all disputed issues that are so triable.
10
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 11 of 47
follows:
1. Judgment finding that the ’562 patent is valid, enforceable and infringed by
Defendant;
2. Judgment finding that the ’112 patent is valid, enforceable and infringed by
Defendant;
3. Judgment finding that SolPals’ trade dress is valid, enforceable, and infringed by
Defendant;
4. Judgment finding that the NDA is valid, enforceable, and breached by Defendant;
servants, employees, successors, assigns and all other persons in active concert or participation with
any of them, enjoining them from directly or indirectly infringing in any manner the claims of the
’562 patent and/or the ’112 patent, directly or indirectly infringing in any manner SolPals’ trade
infringement of the ’562 patent and the ’112 patent, including an award of Defendant’s total profits
9. Judgment that this is an exceptional case pursuant to 35 U.S.C. § 285, together with
11
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 12 of 47
10. Plaintiffs’ costs in bringing this action pursuant to all applicable federal, state and
11. Prejudgment interest pursuant to all applicable federal, state and statutory law,
12. Post-judgment interest pursuant to all applicable federal, state and statutory law,
13. For such other and further relief as the Court deems just and equitable.
Respectfully submitted,
WORKMAN NYDEGGER
12
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EXHIBIT A
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EXHIBIT B
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EXHIBIT C
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EXHIBIT D
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EXHIBIT E
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 36 of 47
This firm represents SolPals, LLC and C-Slide Holdings, LLC (collectively, “SolPals”) in
connection with the protection and enforcement of its intellectual property rights. SolPals holds
various intellectual property rights related to unique designs for webcam covers, as well as
packaging and marketing materials relating thereto. SolPals has obtained the following patents in
the United States related to webcam covers:
SolPals has expended considerable resources creating and protecting its intellectual
property and is dedicated to protecting and enforcing its intellectual property rights.
As you know, last year, HandStands Promo, LLC (“HandStands”) submitted proposals to
purchase SolPals. During negotiations over that potential transaction, SolPals disclosed
confidential information and business practices to HandStands under the protection of a Mutual
Nondisclosure Agreement executed by both parties (“the NDA”). A copy of the NDA is enclosed
for your convenience. The NDA expressly prohibits HandStands from using any Confidential
Information disclosed to it by SolPals for HandStands’ own use or for any purpose other than
discussions regarding HandStand’s possible acquisition of SolPals. [See NDA, § I.c.]
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 37 of 47
HandStands Promo, LLC
March 14, 2018
Page 2
---------------------------------------------
Since negotiations over the acquisition of SolPals terminated, HandStands has released its
own webcam cover (“the Private Eyes Webcam Cover”)1. SolPals is very concerned about this
development for several reasons.
First, the Private Eyes Webcam Cover is substantially similar to the webcam cover of
SolPals’ U.S. Pat. Nos. D782,562 (“the ’562 Patent”) and D669,112 (“the ’112 Patent”), as shown
in the side-by-side comparisons below:
The ’562 Patent and the ’112 Patent each cover a webcam cover with an elongated frame
that surrounds a webcam and encloses a sliding door that can slide laterally to cover the webcam.
Similarly, the Private Eyes Webcam Cover has an elongated frame that surrounds a webcam and
encloses a sliding door that can slide laterally to cover the webcam.
1
Available at https://handstandspromo.com/products/private-eyes.
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 38 of 47
HandStands Promo, LLC
March 14, 2018
Page 3
---------------------------------------------
35 U.S.C. § 271 prohibits making, using, offering to sell, selling, or importing “any
patented invention during the term of the patent” without authority from the patent owner. A
product design is said to infringe a patented design if the two designs are substantially similar to
an ordinary observer such that the observer would purchase one product supposing he had
purchased the other. Egyptian Goddess, Inc. v. Swisa, Inc., 543 F.3d 665, 670–74, 677–79 (Fed.
Cir. 2008) (en banc) (relying on Gorham Co. v. White, 81 U.S. 511, 528 (1871) (“[I]f, in the eye
of an ordinary observer, giving such attention as a purchaser usually gives, two designs are
substantially the same, if the resemblance is such as to deceive such an observer, inducing him to
purchase one supposing it to be the other, the first one patented is infringed by the other.”). Minor
differences between a patented design and a copy will not preclude a finding of infringement. Id.
at 670. As shown above, the Private Eyes Webcam Cover is substantially similar to the webcam
cover of the ’562 Patent and the ’112 Patent, and an ordinary observer would easily confuse them.
35 U.S.C. § 284 provides that the owner of a patent shall recover “damages adequate to
compensate for the infringement but in no event less than a reasonable royalty for the use made of
the invention by the infringer, together with interest and costs.” The court may further “increase
the damages up to three times the amount” and, in exceptional cases, “award reasonable attorney
fees.” Further, 35 U.S.C. § 289 provides that the infringement of a design patent may result in
liability equal to “the extent of (the infringer’s) total profit.” Now that HandStands is on notice of
SolPals’ patent rights, if HandStands makes, uses, offers to sell, sells, or imports the Private Eyes
Webcam Cover in the United States, such actions are likely to constitute willful infringement of
SolPals’ patent rights and qualify this as an exceptional case.
HandStands’ packaging mirrors many elements of SolPals’ packaging, down to the very
size of its custom insert cards. HandStands did not market its products in this fashion until SolPals
gave HandStands confidential information, provided by SolPals under NDA, that this product
packaging positively impacts SolPals’ sales. Thus, it is likely that HandStands is using SolPals’
confidential information in violation of the NDA. Furthermore, the consuming public has come to
associate this packaging with SolPals, and SolPals has built up common law trade dress rights in
this packaging. HandStands’ use of this packaging will lead consumers to think, erroneously, that
HandStands and/or its products are affiliated with SolPals, and constitutes a violation of SolPals’
trade dress rights.
Third, HandStands has started to offer custom printing in unlimited colors on its products.
No other entity in the market offers this service besides SolPals, and HandStands did not begin to
offer it until after SolPals had informed HandStands, under the protection of the NDA, of SolPals’
business practices. HandStands’ new line of services is further evidence of its use of confidential
information in violation of the NDA.
SolPals is committed to protecting its intellectual property rights, including its unique
brands and designs. SolPals is confident it will prevail in an infringement action if HandStands
continues to make, use, offer to sell, sell, or import the Private Eyes webcam cover in the United
States, continues to violate the NDA, and/or continues to use packaging similar to that used by
SolPals. To that end, we have enclosed a copy of a complaint we have drafted against HandStands.
SolPals has not yet filed this complaint, but is prepared and willing to do so if HandStands does
not immediately cease violating the NDA and infringing SolPals’ intellectual property rights.
Before taking that step, however, SolPals is willing to attempt to resolve this matter outside
of the courts. Therefore, SolPals hereby demands that HandStands immediately:
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 40 of 47
HandStands Promo, LLC
March 14, 2018
Page 5
---------------------------------------------
1. cease making, using, offering to sell, selling, and/or importing products in the United
States, including the Private Eyes Webcam Cover, that infringe any of SolPals’ patents;
2. cease using in commerce any trade dress that is confusingly similar to SolPals’ trade dress;
3. cease using any of SolPals’ confidential information in violation of the terms of the NDA;
4. provide an accounting of any Private Eyes Webcam Cover made, used, offered for sale,
sold, and/or imported into the United States; and
5. identify the entity that manufactures the Private Eyes Webcam Cover.
In addition, please do not destroy any documents, information, or things relating to the
Private Eyes Webcam Cover (including its design, development, and manufacture) until this matter
has been resolved.
Please acknowledge receipt of this letter immediately and give us your written assurance
that you will comply with our demands on or before Monday, March 19, 2018. Although SolPals
hopes the parties can resolve this matter amicably, it reserves its rights under all applicable laws,
including, but not limited to, filing the complaint and/or seeking injunctive relief in the event you
fail to provide written assurances of your compliance by such deadline.
Sincerely,
WORKMAN NYDEGGER
MATTHEW A. BARLOW
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 41 of 47
EXHIBIT F
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 42 of 47
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 43 of 47
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 44 of 47
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 45 of 47
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 46 of 47
Case 2:18-cv-00241-PMW Document 2 Filed 03/21/18 Page 47 of 47
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