Molino's Diamonds Inc v. Quality Gold Inc

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Molino's Diamonds Inc. d/b/a Molino Jewelers (New York)
  • Defendant: Quality Gold, Inc. (Ohio), et al.
  • Plaintiff’s Counsel: Miskin & Tsui-Yip LLP
• Case Identification: 1:10-cv-01828, S.D.N.Y., 03/08/2010
• Venue Allegations: Venue is asserted based on allegations that Defendants transact business, solicit business, ship goods into the district, and derive substantial revenue from commerce having an effect in the district.
• Core Dispute: Plaintiff alleges that Defendants’ convertible style necklaces infringe a patent related to convertible pendant jewelry.
• Technical Context: The technology concerns mechanical jewelry designs that allow a pendant to be transformed from a closed, symbolic shape into a different, open configuration.
• Key Procedural History: The complaint alleges that Plaintiff sent a cease and desist letter to Defendant QualityGold in June 2007, putting it on notice of the patent-in-suit. It further alleges that after QualityGold represented it had ceased sales in July 2007, it resumed selling the accused products by 2009, which may be relevant to the claim for willful infringement.

Case Timeline

Date	Event
2002-07-30	'395 Patent Priority Date
2004-09-14	'395 Patent Issue Date
2007-06-22	Cease and desist letter sent to Defendant QualityGold
2007-07-06	QualityGold allegedly represented it had ceased sales
2009 (early)	QualityGold allegedly resumed sales of accused products
2010-03-08	Complaint Filing Date

II. Technology and Patent(s)-in-Suit Analysis

• Patent Identification: U.S. Patent No. 6,789,395, "Convertible Pendant Jewelry," issued September 14, 2004.

The Invention Explained

• Problem Addressed: The patent does not describe a problem with existing prior art, but its stated object is to provide pendant jewelry that can be converted between multiple configurations, such as a "first closed configuration" to a "second open configuration or even third configuration" ('395 Patent, col. 2:6-9).
• The Patented Solution: The invention is a pendant composed of multiple "pendent elements" connected by hinges, allowing them to pivot relative to one another in a plane ('395 Patent, col. 2:16-19). The elements can be secured by an "attachment means" (e.g., a latch) to form a closed shape like a heart or a cross ('395 Patent, col. 2:25-28, Fig. 5). When released, the elements pivot open but are prevented from collapsing or moving past a certain point by "pivot stops," which create a stable open configuration ('395 Patent, col. 2:33-39).
• Technical Importance: The design provides a single piece of jewelry with multiple, stable aesthetic forms, enhancing its versatility.

Key Claims at a Glance

• The complaint asserts "one or more claims" without specifying which ones (Compl. ¶29). Independent Claim 1 is the broadest.
• Essential elements of Independent Claim 1 include:
  • A chain member and a pendant member comprised of a "plurality of pendent elements pivotally connected to each other by hinges."
  • An "attachment means" to fix the elements into a "first closed configuration."
  • A "pivot stop associated with each hinge" that extends laterally from a pendant element.
  • The ability to form a "second open configuration" where the elements are "stopped and prevented from pivoting" beyond a "predetermined angle by the pivot stops."
• The complaint does not explicitly reserve the right to assert dependent claims.

III. The Accused Instrumentality

Product Identification

The complaint names four specific products, including "The Sterling Silver CZ Hearts Convertible Style Necklace" (Style No. QG2128-16) and the "Sterling Silver Red and Clear CZ Cross Convertible Style Necklace" (Style No. QG2127-16) (Compl. ¶15).

Functionality and Market Context

The accused instrumentalities are necklaces with pendants that can be mechanically reconfigured into different shapes (Compl. ¶15). The complaint alleges these products are offered for sale and sold by Defendants through various commercial websites (Compl. ¶¶15-18). Exhibit C, a screenshot from Defendant QualityGold’s website, displays the accused "Hearts Convertible Style Necklace" in what appears to be a closed, heart-shaped configuration (Compl. ¶15, Ex. C). Another visual, Exhibit D, shows the accused "Cross Convertible Style Necklace" in its closed, cross-shaped form (Compl. ¶15, Ex. D). The complaint alleges these products embody the '395 patent but does not describe their internal mechanics or how their transformation is achieved (Compl. ¶29).

IV. Analysis of Infringement Allegations

The complaint alleges that the accused products infringe the ’395 patent but does not provide a claim chart or a detailed, element-by-element mapping of accused features to the patent’s claims (Compl. ¶¶29-32). The infringement theory appears to be that the Defendants' "Convertible Style" necklaces, which transform between shapes, practice the invention claimed in the ’395 patent. Without specific factual allegations mapping product features to claim limitations, a detailed claim-chart summary cannot be constructed.

Identified Points of Contention

• Technical Question: The complaint does not provide evidence demonstrating that the accused necklaces contain the claimed "pivot stop" mechanism. A central factual dispute will be whether the accused products incorporate a structure that "extend[s] laterally" from a pendant element to physically block the hinge from pivoting beyond a "predetermined angle," as required by Claim 1, or if they achieve a stable open position through a different design. ('395 Patent, col. 6:31-33, 41-42).
• Scope Questions: Claim 1 recites "attachment means" for fixing the pendant in its closed configuration. This term is likely a means-plus-function limitation governed by 35 U.S.C. § 112, ¶ 6 (pre-AIA). Its scope would be limited to the corresponding structures disclosed in the specification—"mating latches" and a "magnetized latch"—and their legal equivalents ('395 Patent, col. 4:51-54, Fig. 9a). A dispute may arise over whether the locking mechanism used in the accused products is the same as or equivalent to these disclosed structures.

V. Key Claim Terms for Construction

The Term: "pivot stop"

• Context and Importance: This term is central to the invention's novelty, as it defines the mechanism that prevents the pendant from unintentionally closing when in its open configuration. Infringement will likely depend on whether the accused products possess a structure that meets the definition of a "pivot stop."
• Intrinsic Evidence for Interpretation:
  • Evidence for a Broader Interpretation: A party could argue the term should be construed functionally to cover any structure that achieves the claimed result of preventing pivoting "to a predetermined angle" ('395 Patent, col. 6:41-42).
  • Evidence for a Narrower Interpretation: The specification describes the stop as "extending laterally from a respective one of said pendant elements" ('395 Patent, col. 6:31-33). Figures 2, 4, and 6 depict these stops (e.g., 15a, 15b) as distinct physical protrusions on the elements that create a hard stop upon contact. A party could argue the term is limited to this specific structural embodiment.

The Term: "attachment means"

• Context and Importance: As a likely means-plus-function term, its construction will define the specific structures covered by this part of the claim. The infringement analysis for this element will be strictly tied to the structures disclosed in the patent.
• Intrinsic Evidence for Interpretation:
  • The function recited is fixing the pendant in a "first closed configuration" ('395 Patent, col. 6:35-37). The specification discloses two corresponding structures to perform this function: "mating latches on each end of the pendant member" and a "magnetized latch" ('395 Patent, col. 4:51-54). The construction of this term would be limited to these disclosed structures and their equivalents.

VI. Other Allegations

Indirect Infringement

The complaint makes a conclusory allegation that Defendants induce infringement by "inducing others to use and sell" the products (Compl. ¶29). It does not, however, plead specific facts to support the element of intent, such as referencing user manuals or advertising that instruct on the infringing use.

Willful Infringement

The complaint alleges that Defendant QualityGold's infringement is "deliberate, willful and wanton" (Compl. ¶33). This allegation is supported by the claim that QualityGold had pre-suit knowledge of the ’395 patent via a cease and desist letter sent on June 22, 2007, and that it resumed sales in 2009 after having represented that it would stop (Compl. ¶¶23-25).

VII. Analyst’s Conclusion: Key Questions for the Case

• A primary issue will be one of structural comparison: do the accused convertible necklaces incorporate the specific "pivot stop" mechanism claimed in the patent—a lateral extension that limits hinge rotation—or do they achieve a stable open configuration through a different, potentially non-infringing mechanical design?
• The case will also likely involve a key question of claim construction, particularly regarding the means-plus-function term "attachment means." The outcome may depend on whether the locking mechanisms in the accused products are found to be structurally equivalent to the "mating latches" or "magnetized latch" disclosed in the patent specification.
• Finally, a central factual question for willfulness will be the defendant's state of mind: did QualityGold's alleged resumption of sales after receiving a cease and desist letter and representing it would stop sales rise to the level of objective recklessness required to support enhanced damages?