Federal Circuit throws out competitive injury claim against Nautilus

The US Court of Appeals for the Federal Circuit has rejected a man’s claim that he was stopped from entering the fitness machine market because he feared infringing patents that were eventually found to be falsely attributed to Nautilus.

In its ruling issued on Monday (May 4), the court dismissed claims filed against exercise machine maker Nautilus by Ponani Sukumar, the founder of Southern California Stroke Rehabilitation Associates.

Sukumar first filed a lawsuit against Nautilus at the US District Court for the Western District of Virginia in 2010, alleging that eight of the 24 patents covering nine fitness machines were falsely marked, which means that the machines were not in fact covered by the patents marked on them.

In 2011, the American Invents Act (AIA) introduced a new provision that allows parties to claim for “competitive injury”. Parties can claim for “competitive injury” if they have obtained licenses for falsely marked patents from a market competitor. A day after the AIA was signed into law, Sukumar amended his complaint to include a competitive injury claim.

Sukumar said he had sought a licence from Nautilus to sell modified versions of the machines, but was rejected twice. He claimed he did not enter the market with his versions of the machines in case he infringed Nautilus’s patents.

In 2012, the district court ruled that Nautilus had deceived the public by falsely marking the patents, but rejected Sukumar’s claims Nautilus was liable for competitive injury.

Sukumar appealed against that decision, but the Federal Circuit on Monday affirmed the district court’s ruling, finding that Sukumar was not a direct competitor of Nautilus and there was no evidence to suggest he would start marketing his own line of fitness machines.

“There is no evidence that Sukumar intended to mass produce the designs Nautilus produced for him in competition with Nautilus,” the court said.

A spokesperson for Nautilus told LSIPR: “We are grateful the court agreed that this case lacked merit.

“We’re happy to bring closure to this litigation,” he added.

Sukumar could not be reached for comment.