innovative/"new technology" claims foiled by Dastar

Powerbahn, LLC v. Foundation Fitness LLC, 2021 WL 2689852, No. 1:19-cv-1678-AT (N.D. Ga. Ma.r 26, 2021)

POWERbahn alleged that defendant Wahoo made false representations in its ads by failing to disclose POWERbahn and its CEO as the source of the technology behind Wahoo’s KICKR products, and by representing “that its KICKR products were innovative and incorporated new technology when they in fact were not and did not.” PowerBAHN to plead around Dastar by arguing that Wahoo misrepresented the “inventive services” that “embody” the KICKR products as Wahoo’s own, when those inventive services are actually attributable to POWERbahn. That doesn’t work because Wahoo sold goods that it made, and Dastar clearly prevents attempts to protect ideas “embodied in” goods. The accused ads were clearly for goods, not services, let alone services “qualitatively different” from anything necessarily done in connection with selling the KICKR products.

False advertising: POWERbahn alleged that ads that the KICKR’s road feel relies on “innovative technology” and “new algorithms” “to improve responsiveness and better replicate the sensation of riding on the road” were literally false because: (1) in designing the KICKR control system, Wahoo followed the teachings of a patent application filed in the 1980s and (2) the algorithms in Wahoo’s KICKR infringe on POWERbahn’s patent published in the mid-2000s. 

Statements describing the KICKR technology as “innovative” were nonactionable puffery, unlike similar claims that were combined with specific claims about proprietary technology, “original,” or “first.” What about “new algorithms” and another ad touting “advanced algorithms that originated with the iconic KICKR smart trainer”? A claim based on failure to attribute the technology to POWERbahn was clearly foreclosed by Dastar. But POWERbahn further argued that the algorithms weren’t new and didn’t originate with the KICKR product. Those statements were falsifiable.

However, POWERbahn provided no evidence that they were actually false (even if pending patent infringement claims could show patent infringement)—it didn’t show that the KICKR flywheel didn’t “use[ ] new algorithms to improve responsiveness” or that the KICKR CORE does not use advanced algorithms that “originated with the iconic KICKR smart trainer.” Wahoo acknowledged that it built its products off of pre-existing technology, stating that it “based its design for the control system of the KICKR on the expired, prior art Sargeant patent.” But the court agreed with Wahoo that, “[e]ven if one aspect of a new product is based on something else, it does not mean that other aspects of the product, and the product as a whole, are not new and innovative.”

POWERbahn’s expert opined that Wahoo’s products infringed on the relevant patents, including by using equations disclosed by the patents. But he didn’t opine that the algorithms weren’t new.  POWERbahn could have created a jury question by comparing the algorithms in the KICKR with previously existing algorithms from other products. But it didn’t.