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USI wins limit in copyright infringement case


PHILADELPHIA—USI Holdings Corp. has won a partial summary judgment in its ongoing copyright infringement litigation with Graham Co.

In 2004, Graham Co. sued a USI subsidiary and a former Graham employee, who joined one of USI's predecessor firms in 1991, alleging they "knowingly," "willfully" and without authorization copied Graham's copyrighted, proprietary insurance service and coverage information to solicit and obtain insurance business for USI MidAtlantic Inc.

Graham alleged the infringement went on for 13 years, although the brokerage only found out about it in 2004.

A Philadelphia jury agreed with Graham and ordered USIM to pay nearly $16.6 million and the former employee—Thomas P. Haughey—to pay nearly $2.3 million (BI, July 3, 2006).

Last November, however, the U.S. District Court for the Eastern District of Pennsylvania in Philadelphia ordered a new trial on damages and statute of limitation issues.

On March 29, the federal court granted USI's motion for partial summary judgment on the statute of limitation issue.

"The effect of the court's ruling is to limit any damages awarded to the plaintiff to the period beginning three years prior to Graham's commencement of the action rather than the 13-year period considered by the jury in the original trial," USI said in a statement.

Graham's attorney, David J. Wolfsohn of Woodcock Washburn L.L.P. in Philadelphia, said the ruling will be appealed.

"We do not believe the law imposes on copyright owners the obligation to foretell the future, or to monitor those in possession of copies of a work in the event that such persons might decide willingly to violate federal law—especially since here the works contained copyright notices and Haughey had expressly agreed not to use them in his new job at USI's predecessor," Mr. Wolfsohn said. "Accordingly, we will be appealing the court's decision."

A new trial date has not been set.