Morrison & Foerster Wins Dismissal of Counterclaims for Client Ubiquiti Networks

02/05/2013

Jennifer Lee Taylor

Antitrust Law and Copyright

Press Release

SAN FRANCISCO – February 3, 2013 – Morrison & Foerster has won dismissal of a number of antitrust and other claims on behalf of Ubiquiti Networks, Inc., a leading San Jose-based maker of communications technology components. The ruling includes dismissal with prejudice of claims against Ubiquiti brought under the Sherman Antitrust Act and California’s Cartwright Act.

Intellectual property partner Jennifer Lee Taylor, who led the Morrison & Foerster team on behalf of Ubiquiti, said, “This is a major victory for Ubiquiti and a validation of its business practices. We are very pleased that the judge agreed that nearly all of the defendant’s counterclaims are without merit—unsupported by the intent of Sherman Antitrust federal law, and thus California’s Cartwright Act, and uncorroborated by case law. We look forward to concluding this case favorably on all terms.”

Judge Claudia Wilken of the U.S. District Court for the Northern District of California also granted Morrison & Foerster’s motion to dismiss claims regarding the implied covenant of good faith and fair dealing, defamation, tortious interference, and the Unfair Competition Law. The counterclaims against Ubiquiti were brought by Miami-based Kozumi USA and its principal, William Hsu Wu. Kozumi develops and sells devices supporting wireless Internet technology.

Ubiquiti and Kozumi previously had a distribution agreement whereby Kozumi purchased Ubiquiti products in order to sell them in Latin America. In 2009 Ubiquiti abrogated the agreement, after which Kozumi allegedly continued to purchase Ubiquiti products from other distributors and sell them in Latin America, primarily Argentina.

In May 2012 Ubiquiti filed suit against Kozumi for trademark infringement, counterfeiting, computer fraud, copyright infringement, unfair competition, false advertising, and libel. The suit alleges that Kozumi attempted to engage foreign manufacturers in making counterfeit Ubiquiti products. In July 2012 Morrison & Foerster secured a preliminary injunction to prevent Kozumi from using Ubiquiti’s trademarks and to freeze Kozumi’s assets after evidence emerged that Kozumi was attempting to transfer assets out of the country.

Kozumi filed its counterclaims in October 2012, a month after the court denied its motion to dismiss Ubiquiti’s suit and amend the preliminary injunction. Kozumi’s breach of contract counterclaim still remains in the case.

The case is Ubiquiti Networks, Inc. v. Kozumi USA Corp., et al., 4:12-cv-02582-CW.

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