CLEVELAND, May 10, 2019 /PRNewswire/ -- Two members of McDonald Hopkins intellectual property litigation team, Dave Cupar and Matt Cavanagh, won a significant judgment in a patent and trade secret case in favor of their client, Horizon Global Americas Inc., ending an eight-year legal battle between Horizon and a former business partner, Let's Go Aero, Inc. ("LGA") over intellectual property rights to hitch-mounted bike racks and automobile accessories. Horizon Global Americas Inc. is a subsidiary of Horizon Global Corporation (NYSE: HZN), one of the world's leading manufacturers of branded towing and trailering equipment.
Horizon terminated a license agreement with LGA. After that, LGA alleged that Horizon had to stop selling certain bike racks, cargo carriers, and hitch pins. Horizon disagreed because it had the legal rights to sell those products. LGA sued Horizon in Colorado federal court, claiming the Horizon sales infringed LGA's patents, trademarks, copyrights, and trade secrets. The case worked its way through various courts for years and ultimately was heard before the American Arbitration Association (the "AAA") in Chicago, Ill. After a seven-day trial, the AAA issued a 156-page decision that was almost entirely in Horizon's favor.
The AAA ruled that Horizon's bike racks were not infringing and, in doing so, entirely invalidated four LGA bike rack patents. The AAA further found there was no trade secret misappropriation or copyright infringement by Horizon. While the AAA did find, as Horizon had conceded, that there was a slight oversell of hitch pins beyond what the license termination allowed, and that some LGA instruction sheets should have been removed from Horizon boxes sooner after the license ended, it refused to award the millions sought by LGA's financial expert. Instead, the AAA relied upon the testimony of Horizon's financial expert, who calculated a small damage figure that was orders of magnitude less than what LGA sought.
Earlier this month, the U.S. District Court for the Northern District of Illinois confirmed the AAA's decision and certified it as a court judgment. With this favorable judgment, Horizon can continue to sell its SportWing and NV-2 bike racks without further interference from LGA, and it exonerates Horizon's retailers, who had either been threatened or sued by LGA over their resale of Horizon's bike racks.
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