Infringement litigation leads to $10.7 million power plug award

Los Angeles consumers may not spend a lot time thinking about how everyday products are made as long as they serve their purpose. After all, one light bulb doesn’t seem all that different from another. However, for businesses that design and manufacture unglamorous necessities, product differences determine whether or not the company succeeds.

American Power Conversion Corp. has been ordered to pay $10.7 million to a company that makes a certain kind of plugstrips. Plugstrips are those boxy plug-ins used to connect several electrical devices to the same outlet. The California natives who own Server Technology Inc. claimed American Power Conversion copied their work and infringed on two Server patents.

The argument was over two models of power distribution devices sold by American Power Conversion, the AP7900 and AP8900. Server’s plugstrips can be mounted vertically and contain a digital register marking the flow of electrical current. A federal jury agreed unanimously with the plaintiff’s claim that American Power duplicated Server’s patented products.

The May judgment resolved the lawsuit filed in 2006 against the Schneider Electric SA subsidiary. Server Technology is a privately owned technology business that began in California’s Silicon Valley 30 years ago. The company, which boasts a global presence, employs 150 people.

Many businesses start out small, with few resources other than those needed to keep a company’s head above water. An entire company may be dependent upon the success of a single patented product or variations of the product. Small businesses often don’t have the funds to challenge a patent-thieving competitor in court and instead, focus on making intellectual property hard to steal.

The right legal advice can help build walls around intellectual property. All businesses want to guard patents cost effectively, but even when companies have the means to go toe-to-toe in court, resolution of legal complaints could take years, as it did for Server Technology. Settlements also can provide solutions.

Source: Reno Gazette-Journal, “Reno company wins $10.7M court award” Bill O'Driscoll, Jun. 06, 2014