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Indiana inventors tell Maurer students about challenging big business in federal court

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Speaking recently to a group of students at Indiana University Maurer School of Law, Lebanon inventor Larry Durkos and his son, Duane, told their story of battling the biggest giant in the bedding industry and winning.

The pair filed a patent infringement lawsuit against Missouri-based Leggett & Platt over a stapling machine invented by Larry Durkos. Their success hinged on two key elements: Durkos had the skill to write solid patents, and they had the luck of finding a law firm willing to take the case on contingency.

mattress-ibj-062413-15col.jpg Duane Durkos (left) and his father, Larry, put their business venture on hold and gave money back to investors while they pursued a patent infringement lawsuit against an industry giant. (IBJ File Photo)

“The process is good,” Durkos said, referring to the patent system. “In our case, it saved our lives. If we hadn’t had the patent, we would have been stepped on by Leggett & Platt and been a little grease spot in Boone County.”

Introducing the pair to the students, Mark Janis, director of the Center for Intellectual Property Research at Maurer, said the Durkoses’ story illustrates the way the patent system is supposed to work. When an inventor puts money and sweat behind a product and a company tries to rip off the idea, the patent provides protection.

“It really does show you,” Janis told the students, “how the work you do can make a difference.”

Writing the patents

The elder Durkos got the idea for the stapling machine while he and his wife were touring a bedding factory. When he saw the workers attaching the springs to the wood by hand, he immediately envisioned an automated device.

This is typical for Durkos. He described himself as right-brained and often having pictures of new inventions pop into his mind.

“That has been my whole life,” he said. “I have created things that people like.”

The first patent, from Durkos’ company Imaginal Systematic LLC, was issued for a stapler that was quite sophisticated and included a camera and trainable software. The stapler head would maneuver down through the twisted, zigzag-shaped wire springs and punch the staple into the targeted spot.

A short time later, Durkos noticed the box-spring market was changing. Bedding companies were trending toward the Leggett & Platt wire framework that straightened out the springs and molded them into a more angular configuration.

He realized he had to redesign the staple machine and secure new patents. The next device was actually less sophisticated than the original. Instead of a camera that could rotate, Durkos designed mechanical guides that gripped the wire and moved the stapler head into the proper location.

That guidance mechanism won the patent infringement case. As Imaginal Systematic’s attorney explained to the Federal Circuit Court of Appeals, without that component the entire machine would be worthless because the stapler would not be able to get into the right position.

When the time came to file the patents, Durkos picked up the phone and called his son’s former high school classmate, Tim Niednagel, partner at Faegre Baker Daniels LLP. After all, Durkos was the one who told Niednagel to become a patent attorney.

In the mid-1980s, Durkos was demonstrating his newest invention of a small, portable computer that was much like the laptops which came to market later. He invited Niednagel, then a senior electrical engineering major at Purdue University, to the presentation and afterward advised the young man to go into law.

Writing the patent application is a collaborative process between Durkos and Niednagel. The inventor researches and writes very detailed narratives while the attorney reviews the drafts and suggests revisions.

The day-to-day work would be “a lot more rewarding if there were a lot more clients like Larry,” Niednagel said.

Ironically, Durkos and his son approached Leggett & Platt just as they started work on the first stapling machine in the mid-1990s, asking if the company wanted to be a partner. The bed maker flatly replied it was impossible to invent such a device.

However, when the Durkoses unveiled the equipment at a trade show in 2002, Duane Durkos told the Maurer students, groups of Leggett & Platt representatives constantly walked around the display.

Later, the pair was in a factory in West Virginia and they saw Leggett & Platt’s new stapling machine that looked and functioned a lot like the one Larry Durkos had invented and patented.

Fighting the infringement

At that time, the patents on the second machine had not been issued and, Duane Durkos acknowledged, they were uncertain if Leggett & Platt was infringing. However, he started searching the Internet for a patent litigator.

When he stumbled across Electronics for Imaging Inc., a company that had won a patent lawsuit against Leggett & Platt, he called the general counsel and got the name of the attorney who represented EFI.

Eventually, Steve Hanle, partner at Sheppard Mullin Richter & Hampton LLP, took Imaginal Systematic as a client.

Very few patent infringement lawsuits go to court, according to Don Knebel, partner at Barnes & Thornburg LLP and senior adviser to the Center for Intellectual Property Research at IU Maurer. To litigate a patent dispute, each side must have at least $2 million to cover expenses and have attorneys who can explain complicated technology in terms that the average juror can understand.

Larry and Duane Durkos likely would not have had the funds to take the case to court. When they approached their investors for $250,000 to cover attorney fees, they raised $5,000.

However, they were saved when the law firm agreed to litigate the dispute on contingency. Sheppard Mullin saw the potential to be able to recoup its expenses from the royalties that would flow to Imaginal Systematic for the remaining nine years of the patents.

“It is typical that a couple of guys from Boone County will not be able to file a patent case because they won’t have the money to pay,” Larry Durkos said.

The case moved to court and in January 2012, the U.S. District Court for the Central District of California found Leggett & Platt was, indeed, infringing on the patents of Imaginal Systematic.

A jury was then convened to determine the damages. Larry and Duane Durkos had to fly to Los Angeles and testify during the weeklong hearing.

They followed their attorney’s instruction and put on coats and ties for their court appearances. Knebel said that as a trial strategy, he would probably have kept the pair from wearing ties. He said less-formal dress would have shown the jury they are inventors and possibly convinced the jury to increase the damage amount.

In the end, the jury awarded $5 million to Imaginal Systematic.

With the decision upheld on appeal, the District judge is now determining the royalties. These ongoing payments will come not from the number of machines sold but rather from the savings realized per box spring by using the automated staplers.

Since Leggett & Platt has been willfully infringing since the January 2012 ruling, the judge now has the option of enhancing whatever the royalty amount will be.

Doing some figuring on a spreadsheet, Larry Durkos calculated the savings over the life of the patents would top $100 million.

So much for being a grease spot in Boone County.•

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  1. Hi there I really need help with getting my old divorce case back into court - I am still paying support on a 24 year old who has not been in school since age 16 - now living independent. My visitation with my 14 year old has never been modified; however, when convenient for her I can have him... I am paying past balance from over due support, yet earn several thousand dollars less. I would contact my original attorney but he basically molest me multiple times in Indy when I would visit.. Todd Woodmansee - I had just came out and had know idea what to do... I have heard he no longer practices. Please help1

  2. Yes diversity is so very important. With justice Rucker off ... the court is too white. Still too male. No Hispanic justice. No LGBT justice. And there are other checkboxes missing as well. This will not do. I say hold the seat until a physically handicapped Black Lesbian of Hispanic heritage and eastern religious creed with bipolar issues can be located. Perhaps an international search, with a preference for third world candidates, is indicated. A non English speaker would surely increase our diversity quotient!!!

  3. First, I want to thank Justice Rucker for his many years of public service, not just at the appellate court level for over 25 years, but also when he served the people of Lake County as a Deputy Prosecutor, City Attorney for Gary, IN, and in private practice in a smaller, highly diverse community with a history of serious economic challenges, ethnic tensions, and recently publicized but apparently long-standing environmental health risks to some of its poorest residents. Congratulations for having the dedication & courage to practice law in areas many in our state might have considered too dangerous or too poor at different points in time. It was also courageous to step into a prominent and highly visible position of public service & respect in the early 1990's, remaining in a position that left you open to state-wide public scrutiny (without any glitches) for over 25 years. Yes, Hoosiers of all backgrounds can take pride in your many years of public service. But people of color who watched your ascent to the highest levels of state government no doubt felt even more as you transcended some real & perhaps some perceived social, economic, academic and professional barriers. You were living proof that, with hard work, dedication & a spirit of public service, a person who shared their same skin tone or came from the same county they grew up in could achieve great success. At the same time, perhaps unknowingly, you helped fellow members of the judiciary, court staff, litigants and the public better understand that differences that are only skin-deep neither define nor limit a person's character, abilities or prospects in life. You also helped others appreciate that people of different races & backgrounds can live and work together peacefully & productively for the greater good of all. Those are truths that didn't have to be written down in court opinions. Anyone paying attention could see that truth lived out every day you devoted to public service. I believe you have been a "trailblazer" in Indiana's legal community and its judiciary. I also embrace your belief that society's needs can be better served when people in positions of governmental power reflect the many complexions of the population that they serve. Whether through greater understanding across the existing racial spectrum or through the removal of some real and some perceived color-based, hope-crushing barriers to life opportunities & success, movement toward a more reflective representation of the population being governed will lead to greater and uninterrupted respect for laws designed to protect all peoples' rights to life, liberty & the pursuit of happiness. Thanks again for a job well-done & for the inevitable positive impact your service has had - and will continue to have - on countless Hoosiers of all backgrounds & colors.

  4. Diversity is important, but with some limitations. For instance, diversity of experience is a great thing that can be very helpful in certain jobs or roles. Diversity of skin color is never important, ever, under any circumstance. To think that skin color changes one single thing about a person is patently racist and offensive. Likewise, diversity of values is useless. Some values are better than others. In the case of a supreme court justice, I actually think diversity is unimportant. The justices are not to impose their own beliefs on rulings, but need to apply the law to the facts in an objective manner.

  5. Have been seeing this wonderful physician for a few years and was one of his patients who told him about what we were being told at CVS. Multiple ones. This was a witch hunt and they shold be ashamed of how patients were treated. Most of all, CVS should be ashamed for what they put this physician through. So thankful he fought back. His office is no "pill mill'. He does drug testing multiple times a year and sees patients a minimum of four times a year.

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