Magazine article Editor & Publisher

Cloning Lawsuits

Magazine article Editor & Publisher

Cloning Lawsuits

Article excerpt

THE LONGEST-RUNNING legal soap opera in newspaper printing press manufacturing -- 12-year-old litigation surrounding cloning of the Goss Community Press --has taken a new twist.

Now the company being sued for allegedly using "tainted" drawings to build Community clones is itself suing two other press companies, saying they are illegally using drawings of the clones.

Tensor Group Inc. is now fighting a two front legal battle: defending itself against Rockwell and making its own allegations that its intellectual property has been taken by two press refurbishers.

Most interesting among those Tensor is suing is Randal Coakley Jr., who once was executive vice president of the press maker that started all this fuss in the first place: defunct DEV Industries Inc.

Tensor's suit against Coakley also charges that the former DEV executive is bad-mouthing Tensor in Scandinavia, where the 3-year-old company is having some of its strongest sales.

Like Jarndyce and Jarndyce, the endless lawsuit at the center of Charles Dickens' Bleak House, the Goss Community cloning litigation involves so many new players and plot wrinkles that it cries out for a Cliff's Notes study guide -- or at least a score card to tell the players apart.

Here-much abridged -- is the story so far:

Rockwell Graphic Systems sued DEV Industries in 1984, alleging DEV used stolen drawings to build clones of the Goss Community, the single-width off set press that is perhaps the most popular newspaper press ever manufactured.

After prolonged motions and counter-motions, discovery and other legal maneuvering, a federal judge in Chicago ruled for DEV Judge Ann C. Williams said Rockwell's security of its engineering drawings was so lax -- for instance, the file cabinet for the drawings did not even have a lock on it until 1979 -- that the company did not meet the legal standard to claim the drawings were trade secrets.

The 7th Circuit Court of Appeals, however, overturned Williams' summary judgment and ordered a trial. That set a pattern that has continued to the present: Trial Judge Williams has generally ruled against Rockwell and the appeals court has generally ruled for Rockwell.

When the trial concluded in December 1992, the jury found that DEV and its officers had misappropriated trade secrets and engaged in unfair competition and unjust enrichment. Rockwell was awarded $2,675,000 in damages.

That amount was considerably less than Rockwell had sought, but proved high enough to knock DEV out of business by the summer of 1993.

DEV's assets, including its customer lists and those engineering drawings that were not among the stolen drawings, were sold at a bankruptcy liquidation.

They were bought by a new company called Tensor Group Inc. -- and very soon there was a new name in the Community clone litigation.

Tensor markets its own clones of the Community known as the tensor Series 1400 and 2400. Tensor says it manufactured its versions by working from the drawings bought at auction -- covering more than 90% of the press components -- and had an engineering firm reverse-engineer the remaining parts. Tensor added its own innovations along the way, the Willowbrook, Ill.-based company says.

Rockwell, though, says it suspects the stolen or "tainted" drawings were used to build Tensor presses. It further alleges Tensor is a virtual successor to DEV and that Tensor should be forced to comply with all injunctions that prohibit DEV and its officers from using trade secrets. …

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