Brookwood Companies, Inc., a Subsidiary of Hallwood Group Inc., Is Sued by Nextec Applications for Infringement of Five of Its P
April 18 2008 - 8:00AM
Marketwired
NEW YORK, NY filed suit in the United States District Court for
the Southern District of NY, against Brookwood Companies, Inc.
("Brookwood"), a fully owned subsidiary of Hallwood Group, Inc.
("Hallwood") (AMEX: HWG), and, according to Hallwood's 2007 form
10-K, Hallwood "derives substantially all of its operating revenues
from the textile activities of its Brookwood subsidiary." Nextec's
legal action arises under the patent laws of the United States and
alleges that Brookwood has and continues to, with prior notice and
knowledge of Nextec's patent rights, intentionally and willfully
infringed on numerous patents owned by Nextec. Nextec is
represented by Sheppard Mullin Richter and Hampton LLP.
Nextec's claims in this action allege willful infringement by a
number of fabrics produced by Brookwood, including those fabrics
that make up two of the seven layers that make up the U.S. Army's
Gen III ECWCS (Extended Cold Weather Clothing Systems) program. The
Gen III ECWCS is the 3rd generation of the Army's ECWCS, and
according to ADS, Inc. ("ADS"), the prime vendor for the Gen III
ECWCS program, "If all options are exercised the total contract
value could exceed $1.1 billion." Nextec is seeking full damages
for infringement of each of the patents-in-suit, enhancement of
damages for willful infringement for each of the patents in suit, a
permanent injunction prohibiting further infringement, and other
relief as may be determined by a jury or a court of competent
jurisdiction. Willful infringement of U.S. patents carries with it
the right for a plaintiff to seek treble damages.
Nextec is a technology-based fabric manufacturer and licensor of
its technology. Nextec's patented technology relates to performance
fabrics and products made therefrom, that are water resistant, have
low absorption, are breathable and durable. Nextec's fabrics were
the only fabrics fully field tested by the U.S. Army as part of the
Army's research and development for the Gen III ECWCS layers 5 and
7, and were the only fabric for layers 5 and 7 highlighted by ADS
in its press release announcing that it had been awarded the Gen
III ECWCS contract.
Peter Santoro, Nextec's Co-CEO, stated, "Nextec, its owners at
General Electric, and all our other partners, have invested over
$70 million in R&D and in developing Nextec's technology based
business. Nextec has worked closely with the U.S. Military in the
development of the Gen III program, and view this as a significant
business opportunity. As we have successfully done in all cases in
the past, we will vigorously defend Nextec's patents and its
business opportunities and will hold all parties, at all levels in
a supply chain, accountable that infringe on Nextec's patents."
Section 271(a) of the federal Patent Laws, 35 U.S.C. � 271(a),
provides in pertinent part:
[W]hoever without authority makes, uses, offers to sell or sells any
patented invention, within the United States or imports into the United
States any patented invention during the term of the patent therefor,
infringes the patent.
Based on U.S. patent law, all parties that use an infringing
fabric at any stage in a garment manufacturing process, including
its ultimate sale, would also infringe a patent holder's patents
and be liable. Mr. Santoro went on to say, "I am particularly
encouraged by recent developments in our litigation and I am
confident that justice will prevail. And, given the value of the
Gen III contract, the price of that justice could be very
significant."
CONTACT: Amar Thakur 858.720.8963
Hallwood (AMEX:HWG)
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