CTS Cement wins lengthy patent case

Shop right gave CTS free license to practice patent for duration of its existence

April 26, 2012

Putting an end to a decade-old patent litigation brought by Ultimax, Hassan Kunbargi, Heartland Cement Sales Co. and the K.A. Group against CTS Cement Manufacturing Corp. (CTS), manufacturers of Rapid Set Cement, its Chairman Edward Rice, and a number of CTS customers, the Honorable Andrew Guilford of the U.S. District Court for the Central District of California ruled that Rice and CTS have a shop right in the patent they allegedly infringed. 

Under the law, this shop right gave CTS and Rice a free license to practice the patent for the duration of its existence. The court further ruled, as additional grounds supporting its decision in CTS’s favor, that Ultimax also had unreasonably delayed filing its suit to CTS’s prejudice. The court found that this delay, along with other factors, also combined to bar Ultimax from asserting infringement claims against CTS pursuant to the doctrines of laches and equitable estoppel.

In 2002, Ultimax and Heartland Cement sued CTS in Federal Court, alleging infringement of 47 claims in three patents. Following a lengthy legal battle, CTS successfully prevailed on all claims but one. This single claim of the ‘556 patent went to two jury trials in 2011. The first resulted in a mistrial because the judge became ill. 

The second trial left a jury divided on several significant issues. However, Judge Guilford ruled that CTS has an irrevocable and royalty-free right to practice the alleged invention. The court ruled that the evidence conclusively demonstrated that Kunbargi used CTS’s facilities, resources and personnel to develop the patent at issue. 

Jerry Hoyle, president of CTS, is grateful that CTS prevailed in this matter. “CTS is vindicated by the court’s finding that we have shop rights in this alleged invention. The innovations in cement technology that Mr. Kunbargi claimed to have pioneered would not have been possible without the financial and scientific resources that CTS provided him while he was working for CTS," said Hoyle.