Southern District of Ohio Judge Edmund A. Sargus, Jr., denied motions to dismiss a complaint against prosthetics maker The Ohio Willow Wood Co. Inc. and inventor Bruce Kania, rejecting the defendants’ argument that the suit failed to state a claim under Section 1 of the Sherman Act because it alleges harm caused by patent enforcement.
The lawsuit accuses Ohio Willow Wood and Kania of carrying out a scheme to impede competition in the U.S. market for fabric-covered polymetric gel liners used with prosthetic devices, by using fraudulently obtained patents and the threat of litigation to force other competitors into unreasonable licensing deals.
The court had previously held that even if the fraudulent prosecution of a patent by itself doesn’t run afoul of the Sherman Act, a scheme involving multiple parties using fraudulent means to obtain and enforce a patent could constitute such a violation, Judge Sargus said. And although Judge Sargus noted that licensing agreements typically were not subject to antitrust liability, courts assessing antitrust liability must look at the alleged monopolist’s conduct as a whole. He concluded that discovery could yield evidence that Ohio Willow Wood engaged in fraudulent or anticompetitive conduct in making the licensing agreements as part of an overall scheme to create a monopoly.