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Dial v. Cot'n Wash et. al

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Dial v. Cot'n Wash et. al Powered By Docstoc
					                                                                       1   Andrew F. Halaby (#017251)
                                                                           ahalaby@swlaw.com
                                                                       2   Matthew T. Schoonover (#028003)
                                                                           mschoonover@swlaw.com
                                                                       3   SNELL & WILMER L.L.P.
                                                                           One Arizona Center
                                                                       4   400 E. Van Buren
                                                                           Phoenix, AZ 85004-2202
                                                                       5   Telephone: (602) 382-6000
                                                                           Attorneys for Plaintiff
                                                                       6
                                                                                                     UNITED STATES DISTRICT COURT
                                                                       7
                                                                                                             DISTRICT OF ARIZONA
                                                                       8
                                                                       9
                                                                           The Dial Corporation, a Delaware                  No.
                                                                      10   corporation,
                                                                      11                        Plaintiff,                   COMPLAINT
                  One Ariz ona Center, 400 E. Van Buren, Suite 1900




                                                                      12   v.                                                (Jury Trial Demanded)
Snell & Wilmer
                            Phoenix , Arizona 85004-2 202
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                                                                      13   Cot’N Wash, Inc., a Pennsylvania
                                                                           corporation; and Big 3 Packaging, LLC, a
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                                    602.382 .6000




                                                                      14   New Jersey limited liability company,
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                                                                      15
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                                                                                                Defendants.
                                                                      16
                                                                      17          Plaintiff The Dial Corporation (“Dial”), for its complaint against defendants Cot’N
                                                                      18   Wash, Inc. (“Cot’n Wash”) and Big 3 Packaging, LLC (“B3P”) (collectively,
                                                                      19   “Defendants”), hereby alleges as follows:
                                                                      20                                        THE PARTIES
                                                                      21          1.     Dial is a Delaware corporation with its principal place of business at 19001
                                                                      22   N. Scottsdale Road, Scottsdale, Arizona, 85255.
                                                                      23          2.     Upon information and belief, Cot’n Wash is a Pennsylvania corporation
                                                                      24   with its principal place of business at 2 Logan Square, Suite 400, Philadelphia,
                                                                      25   Pennsylvania, 19103.
                                                                      26          3.     Upon information and belief, B3P is a New Jersey limited liability company
                                                                      27   with its principal place of business at 4201 Torresdale Avenue, Philadelphia,
                                                                      28
                                                                        1   Pennsylvania, 19124. Upon information and belief, the sole member of B3P is Richard A.
                                                                        2   Higgs, who resides in or around Bedminster, New Jersey.
                                                                        3                                 JURISDICTION AND VENUE
                                                                        4          4.     This action is brought pursuant to the patent laws of the United States, Title
                                                                        5   35 of the United States Code, the Lanham Trademark Act of 1946, as amended, 15 U.S.C.
                                                                        6   § 1051, et seq., and the common law prohibition on unfair competition.
                                                                        7          5.     This Court has subject matter jurisdiction over this matter pursuant to 28
                                                                        8   U.S.C. §§ 1331 and 1338(a) and (b). This Court has supplemental jurisdiction over Dial’s
                                                                        9   related state law claim under 28 U.S.C. § 1367.
                                                                       10          6.     Additionally, this Court has subject matter jurisdiction pursuant to 28 U.S.C.
                                                                       11   § 1332(a)(1), as this action is between citizens of different states and, on information and
                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




                                                                       12   belief, the amount in controversy exceeds $75,000.
Snell & Wilmer
                            Phoenix , Arizona 85004-2 202
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                                                                       13          7.      This Court has personal jurisdiction over Cot’n Wash, among other
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                                                                       14   reasons, because, on information and belief, Cot’n Wash, with implicit and/or apparent
                                         L.L.P.




                                                                       15   cooperation from B3P, has purposefully directed its conduct at the State of Arizona, and
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                                                                       16   has sufficient contacts with this judicial district, including without limitation, through
                                                                       17   conducting business within the State of Arizona and within this judicial district, including
                                                                       18   through the sale of its products to businesses and/or consumers in Arizona via, among
                                                                       19   other channels, its website. Upon information and belief, such contacts include without
                                                                       20   limitation Cot’n Wash’s activities relating to the sale of its “Dropps” products. Upon
                                                                       21   information and belief, such sales are substantial, continuous, and systematic.
                                                                       22          8.     This Court has personal jurisdiction over B3P, among other reasons,
                                                                       23   because, on information and belief, B3P has purposefully directed its conduct at the State
                                                                       24   of Arizona, and has sufficient contacts with this judicial district, including without
                                                                       25   limitation, through its participation in, assistance with, contribution to, and/or cooperation
                                                                       26   with Cot’n Wash’s business activities within the State of Arizona and within this judicial
                                                                       27   district, including the sale of the Dropps products identified herein, through without
                                                                       28   limitation B3P’s patent license agreement with Cot’n Wash, as explained below in more

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                                                                        1   detail. Moreover, B3P sells products, including its “PAK-IT” products, to businesses
                                                                        2   and/or consumers in Arizona via, among other channels, its website. Upon information
                                                                        3   and belief, B3P’s activities described herein are substantial, continuous, and systematic.
                                                                        4          9.      Dial is informed and believes that at all relevant times, Defendants were
                                                                        5   acting on their own behalf and/or as the agents, representatives, and/or licensees of each
                                                                        6   other, or that an as yet undetermined corporate or contractual relationships existed
                                                                        7   between or among Defendants, such that the acts described herein were done in the course
                                                                        8   and scope of such relationships, as well as on each Defendant’s own behalf.
                                                                        9          10.      Venue is proper under 28 U.S.C. §§ 1391(b) because the offer for sale and
                                                                       10   sale of falsely marked products occurred in this district, the injuries Defendants have
                                                                       11   caused and continue to cause by virtue of their misconduct as pled herein occurred in this
                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




                                                                       12   district, where Dial’s products are manufactured and where Dial’s marketing and
Snell & Wilmer
                            Phoenix , Arizona 85004-2 202
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                                                                       13   distribution are initiated, and all of the relevant documents and witnesses for Dial are
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                                                                       14   located in this district.
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                                                                       15                                     GENERAL ALLEGATIONS
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                                                                       16          A.      Cot’n Wash and B3P’s Relationship
                                                                       17          11.     U.S. Patent No. 6,136,776 (“the ‘776 Patent”), entitled “Germicidal
                                                                       18   Detergent Packet,” issued on October 24, 2000. A true and correct copy of the ‘776
                                                                       19   Patent is attached as Exhibit A. Dickler Chemical Laboratories, Inc. (“Dickler
                                                                       20   Chemical”) was the original assignee of the ‘776 Patent.
                                                                       21          12.     Upon information and belief, in 2006, Cot’n Wash entered into a license
                                                                       22   agreement and/or a manufacturing and supply agreement with Dickler Chemical under the
                                                                       23   ‘776 Patent. Upon information and belief, in 2007, Cot’n Wash became the exclusive
                                                                       24   licensee under the ‘776 Patent.
                                                                       25          13.     Upon information and belief, in 2007, Pak-It LLC purchased all outstanding
                                                                       26   shares of Dickler Chemical, and Dickler Chemical became a wholly-owned subsidiary of
                                                                       27   Pak-It LLC.
                                                                       28

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                                                                        1          14.   Upon information and belief, in 2009, 310 Holdings, Inc. acquired all
                                                                        2   outstanding shares of Pak-It LLC, and Dickler Chemical remained a wholly-owned
                                                                        3   subsidiary of Pak-It LLC.
                                                                        4          15.   Upon information and belief, in 2009, 310 Holdings changed its name to
                                                                        5   JBI, Inc.
                                                                        6          16.   Upon information and belief, in 2012, B3P acquired substantially all of the
                                                                        7   assets of Pak-It LLC and Dickler Chemical, and Dickler Chemical assigned the ‘776
                                                                        8   Patent to B3P, subject to Cot’n Wash’s exclusive license, which exclusive license, upon
                                                                        9   information and belief, remains in force as indicated above.
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                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




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Snell & Wilmer
                            Phoenix , Arizona 85004-2 202
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                                                                        1         B.     Defendants’ Products
                                                                        2         17.    In 2006, Cot’n Wash began selling water-soluble laundry packets under the
                                                                        3   brand name “Dropps.” Cot’n Wash’s current Dropps product line includes Dropps Fresh
                                                                        4   Scent, Dropps Scent + Dye Free, and Dropps Baby (“the Dropps Products”).
                                                                        5         18.    Upon information and belief, since at least 2009 and possibly earlier, Cot’n
                                                                        6   Wash, with implicit and/or apparent cooperation from Dickler Chemical and/or B3P, has
                                                                        7   marked the Dropps Products with the ‘776 Patent. Upon information and belief, Cot’n
                                                                        8   Wash’s marking has been continuous, as shown by the packaging of a Dropps Fresh Scent
                                                                        9   product purchased in 2012, images of which are reproduced below, with the front of the
                                                                       10   packaging on the left and the back of the packaging on the right:
                                                                       11
                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




                                                                       12
Snell & Wilmer
                            Phoenix , Arizona 85004-2 202
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                                                                       24         19.    As can be seen, the Dropps Fresh Scent product shown above and purchased
                                                                       25   in 2012 is marked with the ‘776 Patent.
                                                                       26
                                                                       27
                                                                       28

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                                                                        1          20.    Moreover, Dropps Baby products currently offered for sale at
                                                                        2   www.soap.com are marked with the ‘776 Patent, as shown by the product images from
                                                                        3   that website, which are reproduced below, with the front of the packaging on the left and
                                                                        4   the back of the packaging (enlarged, lower portion) on the right:
                                                                        5
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                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




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Snell & Wilmer
                            Phoenix , Arizona 85004-2 202
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                                                                       13
                                   LAW OFFICES

                                    602.382 .6000




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                                                                        1          21.    In addition, Dropps Scent + Dye Free products currently offered for sale at
                                                                        2   www.soap.com are marked with the ‘776 Patent, as shown by the product images from
                                                                        3   that website, which are reproduced below, with the front of the packaging on the left and
                                                                        4   the back of the packaging (enlarged, lower portion) on the right:
                                                                        5
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                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




                                                                       12
Snell & Wilmer
                            Phoenix , Arizona 85004-2 202
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                                                                       13
                                   LAW OFFICES

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                                                                       14
                                         L.L.P.




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                                                                       16
                                                                       17
                                                                                   22.    The instances of marking shown above are representative and not
                                                                       18
                                                                            exhaustive.
                                                                       19
                                                                                   23.    Also, B3P sells laundry detergent products, including under the PAK-IT line
                                                                       20
                                                                            of products, that B3P marks on the PAK-IT products and in sales and marketing materials
                                                                       21
                                                                            as being covered by the claims of the ‘776 Patent. Dial is informed and believed that
                                                                       22
                                                                            those B3P products may also be falsely marked with the ‘776 Patent, for similar reasons
                                                                       23
                                                                            as those discussed below with respect to the Dropps Products, and will amend its
                                                                       24
                                                                            Complaint to address this issue as its investigations continue.
                                                                       25
                                                                                   C.     The Dropps Products Are Falsely Marked with the ‘776 Patent
                                                                       26
                                                                                   24.    The ‘776 Patent includes two independent claims: Claim 1 and Claim 23.
                                                                       27
                                                                            Both of those claims of the ‘776 Patent (as well as the twenty-one dependent claims)
                                                                       28

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                                                                        1   require a “germicidal detergent concentrate” that comprises “about 55 wt. % to about 75
                                                                        2   wt. % of at least one quaternary ammonium compound having the general structural
                                                                        3   formula I:
                                                                        4
                                                                        5
                                                                        6
                                                                        7                                               .”
                                                                        8
                                                                        9          25.    Based on the ingredient list included on the Dropps Fresh Scent product
                                                                       10   packaging, and Plaintiff’s chemical analysis of the Dropps Fresh Scent product, the
                                                                       11   Dropps Fresh Scent products do not include the claimed “germicidal detergent
                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




                                                                       12   concentrate” as set forth in, and required by, the claims of the ‘776 Patent. Thus, the
Snell & Wilmer
                            Phoenix , Arizona 85004-2 202
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                                                                       13   Dropps Fresh Scent products are not covered by the claims of the ‘776 Patent.
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                                                                       14          26.    Additionally, based on several indicia, including the ingredient list included
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                                                                       15   on the Dropps Scent + Dye Free and Dropps Baby packaging, and upon information and
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                                                                       16   belief, like the Dropps Fresh Scent products, the Dropps Scent + Dye Free and Dropps
                                                                       17   Baby products do not include the claimed “germicidal detergent concentrate” as set forth
                                                                       18   in, and required by, the claims of the ‘776 Patent. Therefore, upon information and belief,
                                                                       19   like the Dropps Fresh Scent products, the Dropps Scent + Dye Free and Dropps Baby
                                                                       20   products are not covered by the claims of the ‘776 Patent.
                                                                       21          D.     Intent to Deceive the Public
                                                                       22          27.    Despite knowing that the claims of the ‘776 Patent do not cover the Dropps
                                                                       23   Products, Cot’n Wash, with the implicit and/or apparent cooperation of B3P, knowingly
                                                                       24   and intentionally has marked and continues to mark the Dropps Products with the ‘776
                                                                       25   Patent, with the intent to deceive the public.
                                                                       26          28.    Specifically, several facts indicate that Cot’n Wash does not have a
                                                                       27   reasonable belief that the Dropps Products are covered by the claims of the ‘776 Patent
                                                                       28   and are thus properly marked.

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                                                                        1          29.    First, upon information and belief, Cot’n Wash is fully aware of the scope of
                                                                        2   the claims of the ‘776 Patent and their inapplicability to the Dropps Products through its
                                                                        3   negotiations with Dickler Chemical for a license, and later an exclusive license, to the
                                                                        4   ‘776 Patent, and through Cot’n Wash’s related manufacturing and supply agreement with
                                                                        5   Dickler Chemical.
                                                                        6          30.    Second, upon information and belief, one of the co-inventors of the ‘776
                                                                        7   Patent, J. Barry Ruck, is currently employed with B3P as a Senior Technical Chemist. As
                                                                        8   a co-inventor, Dr. Ruck is familiar with both the invention of the ‘776 Patent and the
                                                                        9   formulation of B3P’s PAK-IT products. Upon information and belief, Dr. Ruck, as an
                                                                       10   experienced chemist in the field, is also aware of the formulation of Cot’n Wash’s Dropps
                                                                       11   Products, which his employer B3P has licensed under the ‘776 Patent. Given those
                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




                                                                       12   factors, upon information and belief, Dr. Ruck, B3P, and Cot’n Wash are aware that the
Snell & Wilmer
                            Phoenix , Arizona 85004-2 202
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                                                                       13   Dropps Products are not covered by the claims of the ‘776 Patent.
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                                                                       14          31.    Third, upon information and belief, the other co-inventor of the ‘776 Patent,
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                                                                       15   Lawrence R. Dickler, has served on the Advisory Board of Pak-It LLC, which in 2007
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                                                                       16   became the parent company of Dickler Chemical, prior to B3P’s acquisition in 2012 of
                                                                       17   both Pak-It LLC and Dickler Chemical. Upon information and belief, Dr. Dickler
                                                                       18   continues to have an advisory and/or other business relationship with B3P and/or Dickler
                                                                       19   Chemical. As a co-inventor, Dr. Dickler is familiar with both the invention of the ‘776
                                                                       20   Patent and the formulation of B3P’s PAK-IT products. Upon information and belief, Dr.
                                                                       21   Dickler, as an experienced chemist in the field, is also aware of the formulation of Cot’n
                                                                       22   Wash’s Dropps Products. Given those factors, upon information and belief, Dr. Dickler,
                                                                       23   B3P, and Cot’n Wash are aware that the Dropps Products are not covered by the claims of
                                                                       24   the ‘776 Patent.
                                                                       25          32.    Fourth, upon information and belief, both Cot’n Wash and B3P are fully
                                                                       26   aware of the scope of the claims of the ‘776 Patent through their filing of the lawsuits
                                                                       27   Cot’N Wash, Inc., et al. v. Henkel Corporation, et al., 12-650-SLR, and Cot’N Wash, Inc.,
                                                                       28   et al. v. The Sun Products Corporation, 12-651-SLR, in May 2012 in the United States

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                                                                        1   District Court for the District of Delaware. In those suits, Cot’n Wash and B3P allege that
                                                                        2   the defendants infringe U.S. Patent No. 6,037,319 (“the ‘319 Patent”), which is the parent
                                                                        3   patent to the ‘776 Patent and is also directed to detergent packets. Upon information and
                                                                        4   belief, through their investigations and the preparation of the complaints in those actions,
                                                                        5   Cot’n Wash and B3P were again made aware of the limited scope of the claims of the
                                                                        6   ‘776 Patent and their inapplicability to the Dropps Products. Moreover, Cot’n Wash and
                                                                        7   B3P are represented in the Delaware actions by experienced patent litigation counsel,
                                                                        8   which again shows that they have knowledge of the limited scope of the ‘776 Patent
                                                                        9   claims.
                                                                       10          33.    Fifth, in those Delaware complaints, Cot’n Wash and B3P allege that their
                                                                       11   marking of their products, including the Dropps Products, with the ‘319 Patent put
                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




                                                                       12   defendants on notice of the ‘319 Patent. Upon information and belief, in investigating and
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                            Phoenix , Arizona 85004-2 202
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                                                                       13   making those allegations, Cot’n Wash and B3P were again made aware of the patent
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                                                                       14   marking on their products, including the fact that the Dropps Products are falsely marked
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                                                                       15   with the ‘776 Patent. Furthermore, Cot’n Wash and B3P’s allegations show that they
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                                                                       16   have an established practice of marking their products with patents in an effort to put
                                                                       17   competitors and the public on notice of their purported patent protection, and to gain a
                                                                       18   competitive advantage from such marking.
                                                                       19          34.    Moreover, upon information and belief, Defendants intended to deceive the
                                                                       20   public with their patent false marking scheme. Cot’n Wash, with the implicit and/or
                                                                       21   apparent cooperation of B3P, advertises and represents its products as covered by the
                                                                       22   claims of the ‘776 Patent. In addition to falsely marking the Dropps product packaging,
                                                                       23   Cot’n Wash also advertises on its website that the detergent in the Dropps Products is
                                                                       24   “patented”: “[t]he Dropps formula is enzyme-free, which means we’ve left out the harsh
                                                                       25   cleaning agents that can cause skin irritation in favor of a patented soft-cleaning formula.”
                                                                       26          35.    The more Cot’n Wash advertises to the public that the Dropps Products are
                                                                       27   protected by the ‘776 Patent, the more it promotes the desirability of the Dropps brand,
                                                                       28

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                                                                        1   and the more it sells Dropps Products to the public, even though the ‘776 Patent marking
                                                                        2   is false.
                                                                        3           36.    By falsely marking the Dropps Products, Cot’n Wash, with the implicit
                                                                        4   and/or apparent cooperation of B3P, sought to gain a competitive advantage by deceiving
                                                                        5   competitors into believing that they could not manufacture such products without
                                                                        6   infringing upon Cot’n Wash’s purported patent rights.
                                                                        7           37.    Moreover, upon information and belief, B3P influences and/or cooperates
                                                                        8   with Cot’n Wash’s misconduct alleged herein due to Cot’n Wash’s close relationship with
                                                                        9   Dickler Chemical, which B3P purchased in 2012, including due to Cot’n Wash and
                                                                       10   Dickler Chemical’s manufacturing and supply agreement under the ‘776 Patent.
                                                                       11           38.    Furthermore, the current assignee of the ‘776 Patent, B3P, has a duty to
                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




                                                                       12   ensure that its licensees, including Cot’n Wash, do not falsely mark their products with the
Snell & Wilmer
                            Phoenix , Arizona 85004-2 202
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                                                                       13   ‘776 Patent and thus deceive the public and competitors. B3P has failed to comply with
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                                                                       14   its duty in this case.
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                                                                       15           E.     Dial Has Suffered Competitive Injury
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                                                                       16           39.    Dial and Cot’n Wash are competitors in the market for laundry detergent
                                                                       17   products, and Dial has suffered competitive injury directly and proximately caused by
                                                                       18   Defendants’ false marking scheme.
                                                                       19           40.    Specifically, Dial manufactures and sells, among other products, laundry
                                                                       20   detergent products, including Purex UltraPacks Detergent, Purex Complete 3-in-1
                                                                       21   Laundry Sheets, Purex Complete 3-in-1 Spring Oasis, and Purex 3-in-1 Wash Dry Sheets
                                                                       22   (“the Purex Products”). Dial sells its products through several channels, such as retailers,
                                                                       23   distributors, pharmacies, drug stores, grocery stores, and Internet sales.
                                                                       24           41.    Upon information and belief, Cot’n Wash sells its products, including the
                                                                       25   Dropps Products, in many of the same channels as Dial’s Purex Products, including
                                                                       26   retailers, distributors, pharmacies, drug stores, grocery stores, and Internet sales. Also,
                                                                       27   Dial and Cot’n Wash promote their products to the same potential customers, and Dial
                                                                       28

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                                                                        1   and Cot’n Wash compete for the business of many of the same actual and potential
                                                                        2   customers.
                                                                        3          42.     As a result, upon information and belief, Dial and Cot’n Wash vie for sales
                                                                        4   of their products in the same market and to the same customers, and Defendants’ false
                                                                        5   marking scheme has improperly upset the competitive relationship between Dial and
                                                                        6   Cot’n Wash. For example, through its false marking and promotion of the ‘776 Patent,
                                                                        7   Cot’n Wash attempts to cultivate a reputation in the marketplace of Cot’n Wash as an
                                                                        8   innovator with products that are superior to those offered by competitors, such as Dial.
                                                                        9   Defendants’ false marking scheme is therefore likely to and has the tendency to allow
                                                                       10   Cot’n Wash to compete in the marketplace more effectively against Dial, to deter
                                                                       11   customers from using Dial’s products, and to discourage competitors of Cot’n Wash from
                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




                                                                       12   commercializing products to compete with Cot’n Wash. Defendants’ false marking
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                            Phoenix , Arizona 85004-2 202
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                                                                       13   scheme has caused Dial to suffer, without limitation, lost sales, loss of market share, loss
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                                                                       14   of business opportunities, and loss of good will, by, among other things, deterring
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                                                                       15   customers from purchasing Dial products, negatively impacting Dial’s product offerings
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                                                                       16   and presence at retail channels, and by generally impairing Dial’s competitive efforts.
                                                                       17                       COUNT I - FALSE MARKING (35 U.S.C. § 292)
                                                                       18                           (AGAINST ALL DEFENDANTS)

                                                                       19          43.     Dial realleges and incorporates by reference paragraphs 1 through 42 as if
                                                                       20   fully set forth herein.
                                                                       21          44.     Cot’n Wash, with implicit and/or apparent cooperation from B3P,
                                                                       22   manufactures, markets, offers for sale, and sells Dropps Products.
                                                                       23          45.     Cot’n Wash, with implicit and/or apparent cooperation from B3P, has in the
                                                                       24   past marked and presently marks the Dropps Products with the ‘776 Patent, knowing the
                                                                       25   Dropps Products to be falsely marked because they do not include the claimed
                                                                       26   “germicidal detergent concentrate.”
                                                                       27          46.     Moreover, as explained in paragraphs 27-38 above, Defendants intend to
                                                                       28   deceive the public with their patent false marking scheme. Cot’n Wash, with the implicit

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                                                                        1   and/or apparent cooperation of B3P, advertises and represents its Dropps Products as
                                                                        2   covered by the claims of the ‘776 Patent. In addition to falsely marking the Dropps
                                                                        3   product packaging, Cot’n Wash also advertises on its website that the detergent in the
                                                                        4   Dropps Products is “patented.” By falsely marking the Dropps Products, Cot’n Wash,
                                                                        5   with the implicit and/or apparent cooperation of B3P, sought to gain a competitive
                                                                        6   advantage by deceiving the public and competitors into believing that the Dropps Products
                                                                        7   are covered by the claims of the ‘776 Patent.
                                                                        8            47.       Pursuant to 35 U.S.C. § 292, Dial has suffered competitive injury directly
                                                                        9   and proximately caused by Defendants’ false marking scheme. Cot’n Wash and Dial are
                                                                       10   competitors in the market for laundry detergent. Defendants’ false marking scheme has
                                                                       11   caused Dial to suffer, without limitation, lost sales, loss of market share, loss of business
                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




                                                                       12   opportunities, loss of good will, and/or other damages in an amount to be determined at
Snell & Wilmer
                            Phoenix , Arizona 85004-2 202
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                                                                       13   trial.
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                                    602.382 .6000




                                                                       14            48.       Defendants deceive and continue to deceive the public by falsely marking
                                         L.L.P.




                                                                       15   the Dropps Products with the ‘776 Patent, and will continue to do so unless enjoined by
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                                                                       16   the Court from their fraudulent and deceptive conduct, and there is no adequate remedy at
                                                                       17   law to prevent such conduct.
                                                                       18                       COUNT II - FALSE ADVERTISING (15 U.S.C. § 1125)
                                                                       19                               (AGAINST ALL DEFENDANTS)

                                                                       20            49.       Dial realleges and incorporates by reference paragraphs 1 through 48 as if
                                                                       21   fully set forth herein.
                                                                       22            50.       Cot’n Wash, with apparent and/or implicit cooperation from B3P, has made
                                                                       23   and continues to make, in bad faith, false or misleading descriptions of fact about its
                                                                       24   Dropps Products as described above. Cot’n Wash has and is deliberately representing its
                                                                       25   Dropps Products as covered by the claims of the ‘776 Patent, despite knowing that such
                                                                       26   products are not covered by the claims of the ‘776 Patent and that such comments are
                                                                       27   literally false.
                                                                       28

                                                                                                                           - 13 -
                                                                        1            51.   The marking of the Dropps Products as covered by the claims of the ‘776
                                                                        2   Patent, when they are not actually covered, is a false or misleading representation of fact.
                                                                        3            52.   Cot’n Wash’s misrepresentations regarding the ‘776 Patent are material in
                                                                        4   that they influence a consumer’s purchasing decisions. For example, among Cot’n
                                                                        5   Wash’s customers are resellers. A reseller prefers a patented product because the patented
                                                                        6   nature of a product would result in higher resale prices and/or a higher sales volume.
                                                                        7   Moreover, Cot’n Wash’s marking of the Dropps Products with the ‘776 Patent is material
                                                                        8   to the decision of consumers to buy such products, in that consumers find purportedly
                                                                        9   innovative products more attractive for purchase.
                                                                       10            53.   Additionally, by identifying the Dropps Products as patented under the ‘776
                                                                       11   Patent, Cot’n Wash suggests to consumers that Cot’n Wash is the only and exclusive
                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




                                                                       12   supplier of such types of products. Those misrepresentations have caused, or are likely to
Snell & Wilmer
                            Phoenix , Arizona 85004-2 202
            ___________




                                                                       13   cause, confusion and mistake by consumers of such products.
                                   LAW OFFICES

                                    602.382 .6000




                                                                       14            54.   Defendants’ scheme to mark the Dropps Products with the ‘776 Patent when
                                         L.L.P.




                                                                       15   such products are not covered by that patent is commercial advertising or promotion that
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                                                                       16   misrepresents the nature and characteristics of the Dropps Products.
                                                                       17            55.   Cot’n Wash, with the implicit and/or apparent cooperation of B3P, has
                                                                       18   wrongfully and illegally advertised its patent rights that Cot’n Wash does not possess, and
                                                                       19   as a result has benefitted commercially and financially while injuring the public by stifling
                                                                       20   competition.
                                                                       21            56.   Defendants’ false marking scheme and related misrepresentations have
                                                                       22   caused Dial to suffer, without limitation, lost sales, loss of market share, loss of business
                                                                       23   opportunities, loss of good will, and/or other damages in an amount to be determined at
                                                                       24   trial.
                                                                       25            57.   Defendants’ false advertising has been willful and deliberate, warranting a
                                                                       26   finding that this is an exceptional case.
                                                                       27
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                                                                        1                   COUNT III - COMMON LAW UNFAIR COMPETITION
                                                                        2                             (AGAINST ALL DEFENDANTS)

                                                                        3          58.      Dial incorporates by reference the foregoing paragraphs 1 to 57 as if set
                                                                        4   forth herein.
                                                                        5          59.      In violation of Arizona’s common law prohibitions against unfair
                                                                        6   competition and for the purpose of preventing Dial from competing with Cot’n Wash,
                                                                        7   Defendants have engaged in unfair competition by falsely claiming that the Dropps
                                                                        8   Products are covered by the claims of the ‘776 Patent, despite knowing that the products
                                                                        9   are not so covered.
                                                                       10          60.      As a proximate result of the acts of Defendants as alleged herein, Dial has
                                                                       11   suffered and will continue to suffer damage, including without limitation, lost sales, loss
                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




                                                                       12   of market share, loss of business opportunities, loss of good will, and/or other damages.
Snell & Wilmer
                            Phoenix , Arizona 85004-2 202
            ___________




                                                                       13   Moreover, by identifying the Dropps Products as patented under the ‘776 Patent, Cot’n
                                   LAW OFFICES

                                    602.382 .6000




                                                                       14   Wash suggests to consumers that Cot’n Wash is the only and exclusive supplier of such
                                         L.L.P.




                                                                       15   types of products. Those misrepresentations have caused, or are likely to cause, confusion
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                                                                       16   and mistake by consumers of such products. Such confusion is especially harmful to Dial
                                                                       17   because it competes with Cot’n Wash in the relevant market.
                                                                       18          61.      Defendants have committed and continue to commit such intentional,
                                                                       19   willful, and malicious acts with the design of disrupting Dial’s business and sales
                                                                       20   activities and reaping for themselves future economic benefit that would otherwise flow to
                                                                       21   Dial. Such actions have caused and will continue to cause damage to Dial, including
                                                                       22   without limitation, lost sales, loss of market share, loss of business opportunities, loss of
                                                                       23   good will, and/or other damages at an amount to be determined at trial. Because
                                                                       24   Defendants’ conduct is in violation of Arizona’s common law prohibition on unfair
                                                                       25   competition, Dial therefore seeks from Defendants compensatory damages, punitive
                                                                       26   damages, statutory or enhanced damages, costs, and any other relief this Court deems
                                                                       27   appropriate.
                                                                       28

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                                                                        1                                     PRAYER FOR RELIEF
                                                                        2          WHEREFORE, Dial respectfully requests that this Court entered judgment in its
                                                                        3   favor and jointly and severally against Defendants and grant the following relief:
                                                                        4          A.       Judgment entered in Dial’s favor and against Defendants on each Count of
                                                                        5   the Complaint;
                                                                        6          B.       Judgment entered that Defendants falsely marked products in violation of 35
                                                                        7   U.S.C. § 292;
                                                                        8             C.    A preliminary and permanent injunction, enjoining Defendant and their
                                                                        9   agents, servants, employees, distributors, licensees, partners, representatives, related
                                                                       10   companies, officers, directors, assigns and attorneys and those in active concert or
                                                                       11   participation with them, from and in any way, promoting, advertising, publicizing, or
                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




                                                                       12   representing in any way that the Dropps Products are covered by the claims of the ‘776
Snell & Wilmer
                            Phoenix , Arizona 85004-2 202
            ___________




                                                                       13   Patent;
                                   LAW OFFICES

                                    602.382 .6000




                                                                       14             D.    Award damages pursuant to 35 U.S.C. § 292 adequate to compensate Dial
                                         L.L.P.




                                                                       15   for the competitive injury it has suffered as a result of Defendants’ false marking;
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                                                                       16          E.       Award an accounting for any falsely marked products not presented at trial
                                                                       17   and an award by the Court of additional damages for any such falsely marked products;
                                                                       18          F.       Award Dial its actual damages and Defendants’ profits attributable to their
                                                                       19   wrongful conduct pursuant to 15 U.S.C. § 1117(a);
                                                                       20          G.       Award treble damages as provided under 15 U.S.C. § 1117;
                                                                       21          H.       Award punitive damages for the willful and wanton nature of Defendants’
                                                                       22   wrongful conduct;
                                                                       23          I.       Award pre-judgment interest;
                                                                       24          J.       Award attorney’s fees pursuant to 35 U.S.C. § 285;
                                                                       25             K.    Award attorney’s fees and cost pursuant to 15 U.S.C. § 1117(a) and any
                                                                       26   other applicable laws; and
                                                                       27             L.    Award Dial such other and further relief as the Court deems just and proper.
                                                                       28

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                                                                        1                                          JURY DEMAND
                                                                        2                   Dial hereby demands a trial by jury on all issues so triable.
                                                                        3              DATED this 17th day of September, 2012.
                                                                                                                                   SNELL & WILMER L.L.P.
                                                                        4
                                                                        5
                                                                                                                              By: s/ Matthew T. Schoonover
                                                                        6                                                        Andrew F. Halaby
                                                                                                                                 Matthew T. Schoonover
                                                                        7                                                        Attorneys for The Dial Corporation
                                                                        8
                                                                        9
                                                                            15822382
                                                                       10
                                                                       11
                  One Ariz ona Center, 400 E. Van Buren, Suite 190 0




                                                                       12
Snell & Wilmer
                            Phoenix , Arizona 85004-2 202
            ___________




                                                                       13
                                   LAW OFFICES

                                    602.382 .6000




                                                                       14
                                         L.L.P.




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