Opinion ID: 815989
Heading Depth: 3
Heading Rank: 2

Heading: Individual defendant Nachemin

Text: The defendants who dealt with Hall were led by Mr. Farley S. Nachemin, Vice President of BB&B and General Merchandise Manager of “bath and seasonal.” On April 20, 2009 Mr. Hall sent an email to Mr. Nachemin concerning their forthcoming meeting, and stated that “[t]he ‘Tote Towel’ is covered by my patent.” Hall states in the complaint that during the meeting on April 22, 2009 the defendants told him that they could have similar towels produced in Pakistan at a lower cost than Hall’s price. Mr. Hall states that he again informed the HALL v. BED BATH 9 defendants “that he had a patent pending on the product.” Compl. ¶23. Hall charged Mr. Nachemin, personally and in his management role, with inducement to infringe and with unfair practices in his actions related to Hall’s Tote Towel. Hall argues that precedent supports imposition of personal liability on such corporate officers, citing Orthokinetics, lnc. v. Safety Travel Chairs, Inc., 806 F.2d 1565 (Fed. Cir. 1986): [I]t is well settled that corporate officers who actively aid and abet their corporation’s infringement may be personally liable for inducing infringement under § 271(b) regardless of whether the corporation is the alter ego of the corporate officer. Id. at 1578-79 (citing Power Lift, Inc. v. Lang Tools, Inc., 774 F.2d 478, 481 (Fed. Cir. 1985)). The district court dismissed all counts against Mr. Nachemin, stating that “the facts alleged in the complaint make clear that any allegedly infringing activity by Nachemin occurred while the ’439 Patent was pending, and did not occur after the patent had issued for the Tote Towel.” The court cited National Presto Industries, Inc. v. West Bend Co., 76 F.3d 1185, 1196 (Fed. Cir. 1996), for the proposition that violation of 35 U.S.C. §271(b) (inducement to infringe) “does not reach actions taken before issuance of the adverse patent.” On this ground, the district court dismissed the complaint against Mr. Nachemin. The court did not discuss the applicability of Orthokinetics, or whether the individual defendants had aided and abetted violations of law. Regarding the district court’s reasoning based on when the ’439 patent issued, we take note that the patent issued only three months after Hall’s sample towel was received by BB&B. On appeal, the defendants support 10 HALL v. BED BATH the district court’s action, but primarily argue that under New York law, “the party seeking to pierce a corporate veil [must] make a two-part showing: (i) that the owner exercised complete domination over the corporation with respect to the transaction at issue; and (ii) that such domination was used to commit a fraud or wrong that injured the party seeking to pierce the veil.” Am. Fuel Corp. v. Utah Energy Dev. Co., 122 F.3d 130, 134 (2d Cir. 1997); see also Wm. Passalacqua Builders, Inc. v. Resnick Developers South, Inc., 933 F.2d 131, 138 (2d Cir. 1991) (“[T]o pierce the corporate veil, the parent corporation must at the time of the transaction complained of . . . have exercised such control that the subsidiary ‘has become a mere instrumentality’ of the parent, which is the real actor.”). Applying the principles of New York law, we do not discern reversible error in the district court’s dismissal of the action against Mr. Nachemin. That dismissal is affirmed.