Adidas AG v. Nike, Inc.

This case, Adidas AG v. Nike, Inc., centers on an inter partes review (IPR) proceeding where Adidas, a global athletic apparel and footwear manufacturer, challenged the patentability of certain claims held by its direct competitor, Nike, Inc., another leading athletic footwear and apparel company. The dispute specifically involved Nike's U.S. Patent No. 8,266,749 (and its related U.S. Patent No. 7,814,598), which are directed to methods of manufacturing an article of footwear with a textile upper, commonly known as Nike's "Flyknit" technology. Adidas's own "Primeknit" products, which employ similar knitted upper technology, are at the heart of the broader competitive context surrounding these patents, although this specific appeal focused on the validity of Nike's patents rather than a direct infringement claim by Adidas.

The procedural posture of this case is an appeal to the United States Court of Appeals for the Federal Circuit (CAFC), a specialized court that hears all patent appeals. Adidas appealed a decision by the Patent Trial and Appeal Board (PTAB) which found that Adidas had not successfully demonstrated that the challenged claims of US8266749 were unpatentable as obvious. The CAFC's role in reviewing PTAB decisions is crucial, as it sets precedent for the interpretation of patent law and IPR proceedings. In this instance, the CAFC affirmed the PTAB's decision, concluding that substantial evidence supported the Board's finding that Adidas failed to show a person of ordinary skill in the art would have been motivated to combine the cited prior art references to achieve Nike's invention.

This case is notable as part of a long-running and intense intellectual property rivalry between two of the world's largest sportswear companies over innovative footwear manufacturing techniques. The dispute over knitted footwear uppers, specifically Nike's Flyknit and Adidas's Primeknit, highlights the importance of technological advancements in maintaining a competitive edge in the athletic footwear market. Furthermore, the Federal Circuit's decision addressed the issue of Article III standing for an appellant in an IPR, affirming that Adidas had standing due to its direct competition with Nike, previous accusations of infringement by Nike concerning similar technology, Nike's assertion of the patent against a third party, and Nike's refusal to grant Adidas a covenant not to sue. This case is one of several IPRs and broader legal battles between Nike and Adidas concerning their knitted shoe technologies, with related proceedings reaching the Supreme Court regarding PTAB procedures.

The case of Adidas AG v. Nike, Inc. (CAFC Case No. 19-1787) primarily involves an appeal from an inter partes review (IPR) proceeding at the Patent Trial and Appeal Board (PTAB), rather than a direct patent infringement lawsuit filed in district court. Therefore, the key legal developments focus on the IPR process and subsequent appeals.

Parallel PTAB IPR Proceedings & Their Effect:

• 2013: Adidas initiated an inter partes review (IPR2013-00067) against Nike's U.S. Patent No. 7,347,011 (the '011 patent), a related Flyknit patent. The PTAB granted Adidas's petition, instituting review of claims 1-46. Nike then sought to amend its patent by canceling claims 1-46 and proposing substitute claims 47-50. The PTAB granted the cancellation but denied the motion for substitute claims, finding Nike failed to establish their patentability.
• 2016 (Nike I): Nike appealed the PTAB's decision regarding the '011 patent (CAFC No. 2014-1719). The Federal Circuit affirmed-in-part, vacated-in-part, and remanded the case for further proceedings concerning the substitute claims. This appeal notably addressed the burden of proving patentability for substitute claims in an IPR.
• 2016 (IPR2016-00366, IPR2016-00921, IPR2016-00922): Adidas initiated two IPRs to challenge claims of Nike's U.S. Patent Nos. 7,814,598 and 8,266,749 (the patents at issue in the 19-1787 appeal). The PTAB initially instituted review on only one of Adidas's obviousness grounds and issued a final written decision against Adidas.
• February 19, 2019: On remand from a Federal Circuit decision (likely related to SAS Institute Inc. v. Iancu), the PTAB again determined that Adidas had not met its burden to prove Nike's patent claims (likely referring to the '598 and '749 patents) unpatentable as obvious. The PTAB specifically found that a person of ordinary skill in the art would not have been motivated to combine the prior art references cited by Adidas.

Appeal to the Federal Circuit (Case No. 19-1787):

• 2019: Adidas appealed the PTAB's decision concerning US8266749 (and US7814598) to the Federal Circuit.
• April 9, 2020 (Related Appeal): In a separate but related appeal concerning the '011 patent (Nike, Inc. v. Adidas AG, Case No. 19-1262), the Federal Circuit vacated a PTAB decision regarding substitute claim 49, finding that the Board violated the Administrative Procedure Act by relying on a prior art reference (Spencer) without providing adequate notice to Nike.
• June 25, 2020: The Federal Circuit issued its opinion in Adidas AG v. Nike, Inc., No. 19-1787 and 19-1788.
  • Standing: The Federal Circuit first addressed the issue of Article III standing, which Nike contested. Nike argued that Adidas lacked standing because Nike had not sued or threatened to sue Adidas for infringement of the '598 or '749 patents. The Court disagreed, finding Adidas had sufficient injury-in-fact due to being direct competitors, Nike's previous accusations of infringement concerning similar technology, Nike's assertion of the '749 patent against a third party, and Nike's refusal to grant Adidas a covenant not to sue.
  • Obviousness: On the merits, the Federal Circuit affirmed the PTAB's decision, concluding that substantial evidence supported the Board's finding that Adidas had not demonstrated that the challenged claims of the '598 and '749 patents were unpatentable as obvious. The court agreed with the PTAB that Adidas failed to show that a person of ordinary skill in the art would have been motivated to combine the cited prior art references (specifically Reed and Nishida, and Nishida, Castello, and Fujiwara). The court highlighted that Reed's teaching of pre-seaming was incompatible with Nike's claims and Nishida's teachings, thus eliminating motivation to combine.

Final Disposition:

• June 25, 2020: Judgment was entered in favor of Nike, affirming the PTAB's decision that the challenged claims of US8266749 (and US7814598) were not unpatentable as obvious.
• 2021: Adidas's petition for certiorari to the Supreme Court was denied.

Further Related Developments (Post-19-1787 Appeal):

• September 1, 2022: A subsequent Federal Circuit decision (Nike, Inc. v. Adidas AG, No. 2021-1903) related to the '011 patent, where the Federal Circuit invalidated the last remaining substitute claim. This decision involved questions of burden of persuasion when the PTAB raises a patentability issue sua sponte. This highlights the extensive and ongoing nature of the patent rivalry between Adidas and Nike beyond the specific patents at issue in the 19-1787 appeal.

In the Federal Circuit case Adidas AG v. Nike, Inc., the plaintiff, Adidas AG, was represented by counsel from Kilpatrick Townsend & Stockton LLP and Finnegan, Henderson, Farabow, Garrett & Dunner LLP. Additionally, Paul Ehrlich serves as General Counsel for Adidas Global Brands & Americas, overseeing various legal matters for the company, though his direct involvement in this specific appeal as lead counsel is not explicitly stated in the provided case details.

Here's a breakdown of the counsel identified for Adidas AG:

• Mitchell G. Stockwell

  • Role: Lead Counsel (for appellant)
  • Firm: Kilpatrick Townsend & Stockton LLP
  • Office Location: Atlanta, GA
  • Note: Kilpatrick Townsend & Stockton has a notable intellectual property practice, frequently handling patent litigation.

• Vaibhav P. Kadaba

  • Role: Counsel (also represented appellant)
  • Firm: Kilpatrick Townsend & Stockton LLP
  • Office Location: Not specified in the provided text, but likely Atlanta, GA, given the lead counsel's location.
  • Note: Involved in patent litigation for Adidas AG.

• Michael T. Morlock

  • Role: Counsel (also represented appellant)
  • Firm: Kilpatrick Townsend & Stockton LLP
  • Office Location: Not specified in the provided text, but likely Atlanta, GA.
  • Note: Involved in patent litigation for Adidas AG.

• Tiffany L. Williams

  • Role: Counsel (also represented appellant)
  • Firm: Kilpatrick Townsend & Stockton LLP
  • Office Location: Not specified in the provided text, but likely Atlanta, GA.
  • Note: Involved in patent litigation for Adidas AG.

While not explicitly listed as appearing counsel in this specific Federal Circuit opinion, Finnegan, Henderson, Farabow, Garrett & Dunner LLP is recognized for its extensive experience in high-stakes patent trials, PTAB proceedings, and Federal Circuit appeals. Given their reputation and frequent involvement in patent cases, it's possible other attorneys from Finnegan contributed to Adidas's overall legal strategy or were involved in earlier stages of the inter partes review. Finnegan boasts a full-service patent litigation team with a strong reputation across various industries, including medical devices, pharmaceuticals, and electronics, and has a deep bench of patent litigators with technical expertise.

Paul Ehrlich serves as General Counsel for Adidas Global Brands & Americas. He has been with Adidas since 1998 and has held his current role since 2014, overseeing a range of legal matters. While he is a key in-house legal figure for Adidas, the Federal Circuit opinion specifically lists the external firm counsel.

In the Federal Circuit case Adidas AG v. Nike, Inc., No. 19-1787, the following counsel represented defendant Nike, Inc.:

• Christopher J. Renk (Lead Counsel)
  • Firm: Banner & Witcoff, Ltd. (Chicago, IL)
  • Note: Renk's practice focuses on intellectual property litigation. He was listed as counsel for Nike in the Federal Circuit's opinion.
• Kevin Dam
  • Firm: Banner & Witcoff, Ltd.
  • Note: Dam was also listed as counsel for Nike in the Federal Circuit's opinion.
• Michael Joseph Harris
  • Firm: Banner & Witcoff, Ltd.
  • Note: Harris was also listed as counsel for Nike in the Federal Circuit's opinion.

While a Supreme Court certiorari petition for Adidas AG v. Nike, Inc. (Docketed: November 25, 2020) lists Aaron Gabriel Fountain as counsel of record for Nike, Inc., this was subsequent to the Federal Circuit's decision in case 19-1787.

Other attorneys appearing for Nike in various patent and intellectual property matters, but not specifically linked to this CAFC case (19-1787) based on available search results, include:

• Victoria F. Maroulis
  • Firm: Quinn Emanuel Urquhart & Sullivan, LLP (Silicon Valley, CA)
  • Note: Managing Partner of the Silicon Valley Office and Co-Chair of the firm's National Intellectual Property Litigation Practice and Life Science Practice. She has served as trial counsel for Samsung in patent, design patent, and trade dress disputes with Apple across various courts, including the Federal Circuit and Supreme Court.
• Allan M. Soobert
  • Firm: Paul Hastings LLP
  • Note: A first-chair litigator focusing on patent and trade secret litigation, with experience before trial and appellate courts, the ITC, and PTAB. He was counsel for eBay in the landmark eBay v. MercExchange case.
• Frank F. L. Gaziano
  • Note: While a Frank Gaziano has filed for patents related to various inventions, and a Frank M. Gaziano is an Associate Justice of the Massachusetts Supreme Judicial Court, there is no direct indication of his involvement as counsel for Nike in this specific case.
• Phillip W. Price
  • Firm: Preis Gordon, A.P.L.C. (Baton Rouge, LA)
  • Note: This individual is a managing partner at his firm with experience in business litigation, but his listed areas of practice on some profiles do not specifically highlight patent litigation. Another "Phillip D. Price" is a patent litigation lawyer in Houston, TX, and a "Phillip Price" is a European and UK Patent Attorney with Dehns, but neither is definitively linked to this specific case.