March 2017: Summary Judgment Victory for Moldex-Metric in Antitrust Suit

The firm secured an important summary judgment ruling for its client Moldex-Metric, in Moldex Metric, Inc. v. 3M Company et al., when the Honorable Joan N. Ericksen of the District Court of Minnesota found that an earlier patent suit that 3M had pursued against Moldex, and in which the firm had prevailed, was so completely baseless as to constitute objectively baseless litigation under the Sherman Act and state malicious prosecution law. The case involves non-linear attenuation earplugs used by the U.S. Military which block loud percussive sounds (gun blasts) that can damage hearing, while still allowing the wearer to hear softer spoken words from a fellow combatant. For a decade, 3M had a virtual monopoly in supplying these products to the entire U.S. Military. In 2011, however, Moldex developed a competing product that the Army began ordering instead of the 3M product. 3M filed suit against Moldex in 2012 claiming that Moldex’s new earplugs infringed a 3M patent directed to a particular type of earplug, in which two different settings could be obtained depending on which end of the plug was inserted into the wearer’s ear. Moldex’s accused earplug was not a dual-ended plug; rather, it was a single-ended plug similar to various prior art plugs cited in and distinguished over in the patent asserted by 3M.

After 3M aggressively prosecuted its infringement suit against Moldex for over one year, forcing Moldex to incur large litigation costs in discovery, 3M served Moldex with a covenant not to sue on its earplug patent on the eve of a hearing on the parties’ summary judgment papers, thereby stripping the court of jurisdiction and resulting in the dismissal of 3M’s claim with prejudice. One year later, Moldex brought suit alleging that 3M’s prior patent infringement claim violated Section 2 of the Sherman Act, and state malicious prosecution law, because no reasonable litigant in 3M’s position would have expected to be successful on the merits of the claim, i.e., the claim was objectively baseless, and because 3M pursued the claim with the anticompetitive and predatory purpose of driving Moldex out of the non-linear attenuation earplug military market, i.e., the claim was subjectively baseless. In its recent ruling granting Moldex’s motion for summary judgment on objective baselessness, after noting the heavy burden faced by Moldex in overcoming 3M’s Noerr-Pennington immunity which typically blocks sham litigation claims like the one brought by Moldex, the court concluded in this case the specification of 3M’s asserted patent made clear that it read on dual ended earplugs only, and that 3M could not have reasonably expected to succeed on the merits of that claim. The case will now proceed to jury trial to determine whether 3M’s prior claim was subjectively baseless.