IP Litigation

SCA Attempts to Wipe Out California-based Tarzana Enterprises’ Napkin Products

Challenge

Tarzana Enterprises, LLC (Tarzana) is a high quality, low price manufacturer and importer of janitorial paper, food service and related products. The company’s main headquarters are located in Tarzana, California, with branch offices in China.

SCA Tissue North America, LLC (SCA) is one of the largest producers/suppliers of tissues in the world. SCA owns U.S. Patent Nos. 7,611,765 and 7,939,159, entitled “Stack of Interfolded Absorbent Sheet Products.” On April 29, 2011, SCA filed suit against Tarzana in the United States District Court for the Western District of Wisconsin for infringement of the patents by Tarzana’s Elegance One-Nap napkin products.

Referred by Tarzana’s insurance carrier as one of the preferred law firms to mount an effective defense, Harness Dickey was ultimately selected to serve as Tarzana’s litigation counsel. Tarzana appreciated that Harness Dickey had tried and won similar cases before, and that our litigation team offered a favorable historical close rate on major litigation claims. It didn’t matter that Tarzana was a California-based business, because Harness Dickey represents clients throughout the country and in courts across the United States.

Solution

The Elegance One-Nap product was a major profit center for Tarzana. At the onset of SCA’s claim, we believed this was yet another example of the industry’s largest player trying to literally wipe-out, through legal and financial bullying, the smaller player. We believed that Tarzana held the legal high ground and that their product did not constitute patent infringement. However, litigation is not always the most cost-effective route to resolution, so we initially attempted to resolve the claim with SCA, who ultimately refused to negotiate.

So, we developed our case strategy and as a result, received a favorable Markman ruling. Our victory at the Markman phase ensured that SCA really had no other option but to reconcile the dispute. SCA and Tarzana entered into a confidential agreement to resolve the patent infringement litigation. Tarzana was very pleased with the outcome because we not only resolved this important business conflict, but also did so at an early point in the litigation to minimize legal spend. Winning is, of course, important — but doing so for a low cost, especially when patent litigation has the potential to be very expensive, is just as important in most instances.

Often times, the products that really make a difference in people’s lives do not constitute a scientific breakthrough or involve complex technologies. Rather, they are items we use daily, such as napkins and napkin dispensers. Today, Tarzana continues to offer ONE Nap, which remains one of their most successful products.