Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_04-cv-00824/USCOURTS-cand-4_04-cv-00824-29/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 35:271 Patent Infringement

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 [Proposed] Findings in Support of Partial Judgment 

under Federal Rule of Civil Procedure 54(b) and Partial Judgment

Case No. 04-0824 CW (WDB) 

e. robert (bob) wallach (SBN 29078) Morgan Chu (SBN 70446) 

Lawyer-Counselor Jonathan Kagan (SBN 166039) 

Law Offices of e. robert (bob) wallach, P.C. Mary Ann Novak (SBN 202502) 

155 Jackson Street, No. 602 Elizabeth L. Rosenblatt (SBN 203196) 

San Francisco, CA 94111 Irell & Manella LLP 

Telephone: (415) 989-6445 1800 Avenue of the Stars, Suite 900 

Facsimile: (415) 989-3802 Los Angeles, CA 90067-4276 

 Telephone: (310) 277-1010 

Alan L. Barry (pro hac vice) Facsimile: (310) 203-7199 

Amy O’Toole (pro hac vice) Attorneys for Defendants

Heather A. Boice (pro hac vice) 

Bell, Boyd & Lloyd LLC 

Three First National Plaza 

70 West Madison, Suite 3300 

Chicago, IL 60602 

Telephone: (312) 372-1121 

Facsimile: (312) 827-8000 

David L. Aronoff (SBN 152606) 

Gayle I. Jenkins (SBN 168962) 

Thelen Reid & Priest LLP 

333 South Hope Street, Suite 2900 

Los Angeles, CA 90071-3048 

Telephone: (213) 576-8044 

Facsimile: (213) 576-8080 

Attorneys for Plaintiff Sharper Image Corporation 

UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF CALIFORNIA 

OAKLAND DIVISION 

SHARPER IMAGE CORPORATION, a 

Delaware corporation, 

 Plaintiff, 

 v. 

THE MAY DEPARTMENT STORES 

COMPANY, a Delaware corporation, TARGET 

CORPORATION, a Minnesota corporation, 

IONIC PRO, LLC, a Delaware corporation, 

IDEAL PRODUCTS, LLC, a Nevis (offshore) 

corporation, SYLMARK, INC., a Delaware 

corporation, SYLMARK, LLC, a Delaware 

corporation, QWIK COOK, INC. d/b/a HOME 

TRENDS, a New York corporation, 

FACTORIES2U, LLC, a California corporation, 

CHAIM MARK BESS, an individual, and PETER 

SPIEGEL, an individual, 

 Defendants. 

 

Case No. 04-0824 CW (WDB) 

FINDINGS IN SUPPORT OF PARTIAL 

JUDGMENT UNDER FEDERAL RULE OF 

CIVIL PROCEDURE 54(b) AND PARTIAL 

JUDGMENT 

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[Proposed] Findings in Support of Partial Judgment

under Federal Rule of Civil Procedure 54(b) and Partial Judgment

Case No. 04-0824 CW (WDB) 

2

The parties to this action, Plaintiff Sharper Image Corporation (“Plaintiff”) and Defendants 

Target Corporation, Ionic Pro, LLC, Ideal Products, LLC, Sylmark, Inc., Sylmark, LLC, Qwik Cook, 

Inc., Factories2U, LLC, Chaim Mark Bess, and Peter Spiegel (collectively, “Defendants”), seek an 

immediate appeal of the Court’s Order Addressing Cross-Motions for Summary Judgment dated 

March 29, 2006, D.I. 856. In particular, the parties seek appeal of the Court’s Order granting in part 

Defendants’ motion for summary adjudication of Plaintiff’s patent and trade dress claims and 

granting Plaintiff’s motion for summary adjudication of Defendants’ tort and state law 

counterclaims. 

The parties submitted a stipulation of dismissal without prejudice of the remaining claims 

and counterclaims. See D.I. 913. According to the parties’ agreement, if an appeal of this case 

resulted in a remand, their remaining claims and counterclaims would be renewed and consolidated 

with the remanded proceedings, and if an appeal did not result in a remand, the remaining claims and 

counterclaims would be submitted for “binding mediation.” Id. The Court denied approval of the 

stipulation and found that entry of partial judgment would provide the most efficient resolution. D.I. 

921 at 2. The Court ordered the parties to submit proposed findings and partial judgment for the 

remaining claims and counterclaims. Id. at 2, 4. 

In support of entry of partial final judgment under Federal Rule of Civil Procedure 54(b), the 

parties submit the following proposed findings and partial judgment: 

I. Procedural History 

In its March 29, 2006 Order, this Court granted Defendants’ motion for summary judgment 

of non-infringement of U.S. Patent No. 6,709,484 (the “‘484 patent”) patent by Defendants Target 

Corporation, Qwik Cook, Inc., Factories2U, LLC and Chaim Mark Bess. D.I. 856 at 14-17. “[W]ith 

respect to the retail Defendants,” the Court found “Plaintiff has not identified evidence of intent 

sufficient to withstand summary judgment” Id. at 14-15. As to Defendant Chaim Mark Bess, the 

Court found “it is not appropriate to pierce the corporate veil and hold Mr. Bess liable for all the 

company’s actions” or hold him personally liable. Id. at 16. The Court also granted Defendants’ 

motion for non-infringement of the ‘484 utility patent based on the second generation Ionic Pro 

product. Id. at 6. 

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[Proposed] Findings in Support of Partial Judgment

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This Court granted Defendants’ motion for summary judgment of non-infringement of U.S. 

Patent No. Des. 433,494 (the “‘494 patent”). The Court construed the ‘494 patent as follows: 

The ‘494 patent is directed toward an ornamental design for a tower-type air purifier. 

The housing has a narrow and tall shape with an oval cross-section, as shown in Figure 1, 

fixed on top of a circular base which is bigger than the bottom of the housing, see Fig. 2. 

Figures 1, 2 and 5 show many horizontal vents which are located along the front and back 

of the tower, separated by scalloped cut-outs on either side of its body. A crescentshaped control button is located on top of the unit, below the handle. Figures 1 and 7. As 

seen from the perspective of Figures 5 and 6, the top of the unit is slanted downward. A 

boomerang-shaped handle (see Fig. 7) is located in a recessed cavity and protrudes up 

from the top. See Figs. 5 and 6. 

Id. at 21. The Court then determined that the potential points of novelty of the ‘494 patent are: “the 

oval cross-section; the scalloped cut-outs separating the vents on either side of the body; the 

crescent-shaped control button; and the boomerang-shaped handle located in a recessed cavity and 

protruding from the top.” Id. at 24. This Court determined that “[o]f these, the only element 

arguably shared by the Ionic Pro is the placement of the handle in a recessed cavity.” Id. 

“Otherwise, the Ionic Pro does not share the IBQ’s points of novelty . . . .” Id. 

This Court also granted Defendants’ motion for summary adjudication of non-infringement 

of Sharper Image’s trade dress in the Ionic Breeze® Quadra®. Id. at 25-35. This Court found 

“Plaintiff has failed to introduce evidence that would allow a reasonable jury to conclude that its 

trade dress is distinctive or that a substantial segment of consumers and potential consumers has a 

mental association between the alleged trade dress and the Sharper Image source.” Id. at 33. The 

Court also found “Plaintiff’s evidence of actual confusion is de minimis, and it certainly is not 

probative of confusion based on trade dress.” Id. at 35. Further, the Court found “Plaintiff has 

failed to raise a triable issue of material fact as to whether consumers are likely to be confused by 

Ionic Pro’s alleged use of IBQ’s trade dress.” Id. The Court concluded “[b]ecause the Court grants 

Defendants’ motion with respect to the trade dress issue, it also grants Defendants’ motion with 

respect to Plaintiff’s § 17200 claim.” Id.

The Court granted Plaintiff’s motion for summary adjudication of Defendants’ counterclaims 

for tortious interference with economic advantage and unfair competition under California Business 

and Professions Code § 17200. Id. at 35-46. This Court determined “the litigation privilege applies 

as an absolute bar to Defendants’ counterclaims.” Id. at 46. 

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[Proposed] Findings in Support of Partial Judgment

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The Court also found that certain issues remained for trial. In particular, the Court found a 

“disputed issue of material fact exists as to whether Ionic Pro users directly infringed the asserted 

claims of the ‘484 utility patent” and denied Plaintiff’s motion for summary judgment of 

infringement of the ‘484 patent. Id. at 13-14. The also Court denied Defendants’ motion for 

summary adjudication of non-infringement of the ‘484 patent with respect to Defendants Ionic Pro, 

LLC, Ideal Products, LLC, Sylmark, Inc., and Sylmark, LLC.1 Id. at 13-15. Thus, the Court 

concluded that Plaintiff’s claims against Defendants Mr. Spiegel, Ionic Pro, LLC, Ideal Products, 

LLC, Sylmark, Inc., and Sylmark, LLC for inducing infringement of the ‘484 utility patent and 

Defendants’ invalidity and non-infringement counterclaims were the only claims remaining for trial.2 

Id. at 52. 

II. Applicable Law 

Federal Rule of Civil Procedure 54(b) provides: 

When more than one claim for relief is presented in an action, whether as a claim, 

counterclaim, cross-claim, or third-party claim, or when multiple parties are involved, the 

court may direct the entry of final judgment as to one or more but fewer than all of the 

claims or parties only upon an express determination that there is no just reason for delay 

and upon an express direction for the entry of judgment. 

In Curtiss-Wright Corp. v. General Electric Co., 446 U.S. 1 (1980), the Supreme Court described the 

analysis a district court should conduct in deciding whether to enter partial judgment under Rule 

54(b): 

[T]he district court must . . . determine whether there is any just reason for delay. Not all 

final judgments on individual claims should be immediately appealable, even if they are 

in some sense separable from the remaining unresolved claims. The function of the 

district court under the Rule is to act as a “dispatcher.” It is left to the sound judicial 

discretion of the district court to determine the “appropriate time” when each final 

decision in a multiple claims action is ready for appeal. This discretion is to be exercised 

“in the interest of sound judicial administration.” 

 

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 The Court granted Plaintiff leave to add Mr. Spiegel as a Defendant. Id. at 50, 52. Plaintiff 

filed a Third Amended Complaint on April 3, 2006, which added Mr. Spiegel as a Defendant and 

asserted a claim for infringement of the ‘484 patent and claims for design patent and trade dress 

infringement and unfair competition. D.I. 860. 

2

 The Court previously stayed Plaintiff’s claims for infringement of U.S. Patent No. 6,713,026 

(the “‘026 patent”) and Defendants’ related counterclaims pending a reissue proceeding in the 

United States Patent and Trademark Office. D.I. 186. The ‘026 patent claim and counterclaims 

remain stayed and would not be tried along with the ‘484 patent claim and counterclaim. Id.

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Thus, in deciding whether there are no just reasons to delay the appeal of individual final 

judgments in setting [sic] such as this, a district court must take into account judicial 

administrative interests as well as the equities involved. Consideration of the former is 

necessary to assure that application of the Rule effectively “preserves the historic federal 

policy against piecemeal appeals.” It was therefore proper for the District Judge here to 

consider such factors as whether the claims under review were separable from the others 

remaining to be adjudicated and whether the nature of the claims already determined was 

such that no appellate court would have to decide the same issues more than once even if 

there were subsequent appeals. 

Id. at 7-8. The Supreme Court acknowledged it does “not suggest that the presence of one of these 

factors would necessarily mean that Rule 54(b) certification would be improper.” Id. at 8 n. 2. 

It would, however, require the district court to find a sufficiently important reason for 

nonetheless granting certification. For example, if the district court concluded that there 

was a possibility that an appellate court would have to face the same issues on a 

subsequent appeal, this might perhaps be offset by a finding that an appellate resolution 

of the certified claims would facilitate a settlement of the remainder of the claims. 

Id. (citing Cold Metal Process Co. v. United Eng’g & Foundry Co., 351 U.S. 445, 450 n.5 (1956)). 

Rule 54(b) certification is proper “if it will aid expeditious decision of the case.” Texaco, Inc. v. 

Ponsoldt, 939 F.2d 794, 797 (9th Cir. 1991) (quotation omitted). The Ninth Circuit recognized in 

Denbicare U.S.A. Inc. v. Toys “R” Us, Inc., 84 F.3d 1143, 1148 (9th Cir. 1996): 

Here, the district court’s use of Rule 54(b) to separate the certain nonpatent claims for 

partial final judgment fits within the scope of the committee’s intent. Because the district 

court both dismissed all patent claims from this case and separated its decision on the 

merits of the nonpatent claims through the grant of a partial final judgment under Rule 

54(b), we have appellate jurisdiction over the partial final judgment. 

This Court suggested that Ninth Circuit law is applicable to determine whether a partial 

judgment under Federal Rule of Civil Procedure 54(b) is appropriate. D.I. 921 at 2 n. 1. Upon 

further consideration, the Federal Circuit may apply its own law to this determination.3

 

 3

 In certain cases, the Federal Circuit has applied the law of the pertinent regional circuit to 

determine whether the district court’s entry was final relative to all pending issues. See Golan v. 

Pingel Enter., Inc., 310 F.3d 1360, 1366 n.3 (Fed. Cir. 2002). Most cases suggest the Federal 

Circuit would apply its own law and not the law of the regional circuit. See, e.g., Ultra-Precision 

Mfg. Ltd. v. Ford Motor Co., 338 F.3d 1353, 1356 (Fed. Cir. 2003) (“We apply our own law and not 

the law of the regional circuit to issues concerning our jurisdiction”); Storage Tech. Corp. v. Cisco 

Sys., Inc., 329 F.3d 823, 829 (Fed. Cir. 2003) (“Federal Circuit law, which we apply instead of 

regional circuit law to issues involving Rule 54(b) certification and our appellate jurisdiction”); State 

Contracting & Eng’g Corp. v. Florida, 258 F.3d 1329, 1334 (Fed. Cir. 2001); Woodard v. Sage 

Prods., Inc., 818 F.2d 841, 844 (Fed. Cir. 1987) (en banc). 

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[Proposed] Findings in Support of Partial Judgment

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Under Federal Circuit law, Rule 54(b) authorizes “an ultimate disposition of an individual 

claim entered in the course of a multiple claims action” in the “interest of sound judicial 

administration.” Intergraph Corp. v. Intel Corp., 253 F.3d 695, 699 (Fed. Cir. 2001) (quoting Sears, 

Roebuck & Co. v. Mackey, 351 U.S. 427, 436-37 (1956)). “A judgment is not final for purposes of 

Rule 54(b) unless it is an ‘ultimate disposition of an individual claim entered in the course of a 

multiple claims action.’” Ultra-Precision, 338 F.3d at 1357 (quoting Sears, 351 U.S. at 435). 

“Moreover, ‘not all final judgment on individual claims should be immediately appealable, even if 

they are in some sense separable from the remaining unresolved claims.’” Ultra-Precision, 338 F.3d 

at 1357 (quoting Curtiss-Wright, 446 U.S. at 8). 

“The function of the district court under the Rule is to act as a ‘dispatcher.’” UltraPrecision, 338 F.3d at 1357 (quoting Sears, 351 U.S. at 436). Rule 54(b) allows a district court to 

act as a “dispatcher” and “determine, in the first instance, the appropriate time when each ‘final 

decision’ upon ‘one or more but less than all’ of the claims in a multiple claims action is ready for 

appeal.” Lava Trading, Inc. v. Sonic Trading Mgmt. LLC, No. 05-1177, 2006 WL 1008842, at *2 

(Fed. Cir. Apr. 19, 2006) (quoting Pause Tech. LLC v. Tivo Inc., 401 F.3d 1290, 1294 n. 2 (Fed. Cir. 

2005)). 

“Even for claims that arise out of the same transaction or occurrence, sound case 

management may warrant entry of partial final judgment.” Intergraph, 253 F.3d at 699. “District 

courts have substantial discretion in determining when there is no just cause for delay in entering 

judgment under Rule 54(b).” Id. (citing Cold Metal, 351 U.S. at 452). 

As discussed in Curtiss-Wright, “the trial court’s decision whether to certify a judgment 

under Rule 54(b) should not be disturbed unless it is ‘clearly unreasonable.’” Intergraph, 253 F.3d 

at 699. “Although it is recognized that piecemeal appeals are inappropriate in cases that should be 

given unitary review, the entry of judgment under Rule 54(b) was clearly reasonable in this case, for 

it would avoid an unnecessary and lengthy trial of complex issues if the Rule 54(b) judgment were 

sustained.” Id. 

Under either the Ninth Circuit or Federal Circuit standard, the present case presents a proper 

circumstance for entry of partial final judgment under Rule 54(b). 

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[Proposed] Findings in Support of Partial Judgment

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III. Analysis 

There is no reason to delay entry of partial final judgment under Rule 54(b) of the claims and 

counterclaims decided in the Court’s March 29, 2006 Order. In the interest of sound judicial 

administration and other equitable considerations, it is appropriate to allow an immediate appeal of 

the Court’s Order disposing of nearly all the claims and counterclaims in the case by summary 

adjudication. The remaining utility patent claims are more narrow in scope and raise wholly 

different issues from those decided in the Court’s Order. In addition, certification under Rule 54(b) 

will provide a prompt and efficient resolution of the case. Pursuant to an agreement between the 

parties, if an appeal does not result in a remand, the remaining claims will be resolved by binding 

mediation not subject to appeal. Even if there is a remand, the remaining claims will be consolidated 

and because these claims are distinct, there is no risk that the appellate court will address the same or 

similar legal or factual issues. 

Initially, if there is no entry of partial judgment under Rule 54(b), there would be a 

significant delay before final judgment of all claims in this case. Patent infringement claims relating 

to the ‘484 and ‘026 utility patents remain in the case, but only the ‘484 patent claims are ripe for 

trial. Claims involving the ‘026 patent have been stayed pending a reissue proceeding in the Patent 

and Trademark Office and that proceeding is in its early stages. Because the ‘026 patent is not 

nearing re-issuance and the parties have not completed discovery relating to the ‘026 patent claims, 

resolution of these claims by summary adjudication or trial would not be achieved for some time. 

The case would remain stagnant on the Court’s docket for a prolonged period and there could be 

unnecessary multiple trials before entry of final judgment. This indefinite delay and the risk of 

potential multiple trials would be eliminated by immediate entry of partial judgment under Rule 

54(b). 

In addition, Plaintiff asserts the ‘484 patent only against the first generation Ionic Pro 

product, which is no longer being sold. In contrast, Plaintiff’s claims for design patent and trade 

dress infringement pertain not only to the first generation Ionic Pro product, but also the currentlyavailable Ionic Pro. Plaintiff alleges its damages for these claims are continuing to accrue. 

Similarly, Defendants allege that damages relating to their tort and state law counterclaims are 

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[Proposed] Findings in Support of Partial Judgment

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continuing. In light of the harsh result that could arise from the delay in adjudicating claims 

involving alleged ongoing infringement and damages, equities weigh in favor of an immediate 

partial judgment. 

Next, the remaining claims for infringement of the ‘484 and ‘026 utility patents raise separate 

and distinct legal and factual issues than those issues decided in the Court’s Order. The Court’s 

Order did not address the ‘026 patent. With regard to the ‘484 patent, the only claims summarily 

adjudicated in the Court’s Order were those asserted against certain retailer Defendants and an 

individual Defendant (Chaim Mark Bess). These claims are based on facts distinct from those 

involving the remaining Defendants. For instance, the alleged knowledge or intent of the retailer 

defendants or the individual acts of Mr. Bess bear no relation to the alleged acts of the remaining 

Defendants. 

In addition, Plaintiff’s design patent and trade dress infringement claims and Defendants’ tort 

and state law counterclaims have no relation to the remaining claims for infringement of the ‘484 

and ‘026 utility patents. Unlike the remaining utility patent claims, the design patent and trade dress 

claims address the appearance of the accused product. 

Moreover, pursuant to the proposed conditional agreement of the parties set forth below, 

Rule 54(b) certification would provide immediate resolution of the case and would not require the 

appellate court to address piecemeal appeals. Through certification under Rule 54(b), the Court may 

dismiss the remaining claims without prejudice and there will be no appeal of the remaining ‘484 

and ‘026 patent claims unless an appeal of the certified judgment results in a remand. If there is no 

remand, the ‘484 and ‘026 patent claims will be submitted to binding mediation which will not be 

subject to an appeal. In this situation, the proposed dismissal of the remaining claims and resolution 

by binding mediation promote efficient judicial administration and provide an economical resolution 

for the parties. 

Finally, in the case of a remand by the appellate court, there is no risk of duplication of effort 

because the remaining claims would be consolidated with the remanded proceedings for trial or other 

disposition by the district court. Because the remaining claims are separate and distinct, the 

appellate Court would not duplicate the same issues in a subsequent appeal. Accordingly, 

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certification of judgment under Rule 54(b) serves the administrative interests of this Court and is 

consistent with the policy against piecemeal appeals. 

IV. Partial Judgment of the Remaining Claims Under the Parties’ Conditional 

 Agreement

Pursuant to agreement of the parties, all remaining claims and counterclaims for Patent 

Infringement of the ‘484 patent, Declaratory Judgment of Non-Infringement of the ‘484 patent, 

Declaratory Judgment of Invalidity of the ‘484 patent, Patent Infringement of the ‘026 patent, 

Declaratory Judgment of Non-Infringement of the ‘026 patent, and Declaratory Judgment of 

Invalidity of the ‘026 patent are dismissed without prejudice under the following conditions: 

1. If an appeal of this case to the United Stated Court of Appeals for the Federal Circuit 

does not result in a remand to the district court, the claims and counterclaims relating to the ‘484 and 

‘026 patents will be submitted to binding mediation before Judge Eugene Lynch. If the parties are 

unable to settle the case through mediation, Judge Lynch will adjudicate the case, and his 

adjudication will result in a binding judgment not subject to appeal. If Judge Lynch is unavailable 

for mediation, the parties will select another mutually agreeable mediator from JAMS in San 

Francisco. 

2. The parties shall not resubmit their claims or counterclaims relating to the ‘484 and 

‘026 patents to any court unless an appeal of this case to the United Stated Court of Appeals for the 

Federal Circuit results in a remand to the district court, in which case jurisdiction over the claims and 

counterclaims relating to the ‘484 and ‘026 patents will be restored and consolidated with the 

remanded proceedings. 

3. The progress of the action with respect to the ‘484 and ‘026 patents shall be frozen. 

No further discovery shall take place, and all other deadlines shall not be modified, except pursuant 

to a Court Order. All pretrial deadlines that had passed as of April 20, 2006 shall remain passed, and 

all pretrial submissions and exchanges made as of April 20, 2006 shall stand without revision, except 

as required to consolidate them with any remanded proceedings. 

4. Mediation relating to the ‘484 and ‘026 patents shall not proceed until resolution of 

all currently pending proceedings regarding the ‘026 patent in the Patent and Trademark Office. 

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5. Each party will bear its own costs and attorneys’ fees in this action. 

IT IS SO ORDERED: 

 5/16/06 /s/ CLAUDIA WILKEN 

Dated: 

 U.S. District Judge Claudia Wilken 

Respectfully submitted by: 

Dated: April 28, 2006 

SHARPER IMAGE CORPORATION 

/s/ Alan L. Barry (electronically signed)*___ 

Alan L. Barry 

Amy G. O’Toole 

Bell, Boyd & Lloyd LLC 

70 West Madison Street, Suite 3100 

Chicago, Illinois 60602 

(pro hac vice) 

Attorneys for Plaintiff Sharper Image 

Corporation 

Dated: April 28, 2006 

TARGET CORPORATION, IONIC PRO, LLC, 

IDEAL PRODUCTS, LLC, SYLMARK, INC., 

SYLMARK, LLC, QWIK COOK, INC. d/b/a 

HOME TRENDS, FACTORIES2U, LLC, 

CHAIM MARK BESS, and PETER SPIEGEL 

/s/ Jonathan Kagan (electronically signed)*____

Morgan Chu 

Jonathan Kagan 

Irell & Manella LLP 

1800 Avenue of the Stars, Suite 900 

Los Angeles, CA 90067-4276 

Attorneys for Defendants 

*Pursuant to General Order No. 45, Section X, by signing above counsel for Plaintiff hereby 

attests it maintains a file copy of this stipulation bearing Defendants’ counsel’s signature. 

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