By Eric Schweibenz
On May 20, 2009, UNeMed Corporation (“UNeMed”) of Omaha, Nebraska filed a complaint requesting that the ITC commence an investigation pursuant to section 337.

The complaint alleges that the following proposed respondents unlawfully import into the U.S. and sell within the U.S. after importation certain products falsely advertised as containing creatine ethyl ester:

  • Bodyonics, Ltd. of Hicksville, New York;

  • Engineered Sports Technology, Inc. of Oviedo, Florida;

  • Proviant Technologies, Inc. of Champaign, Illinois;

  • Controlled Labs of New Rochelle, New York;

  • NRG-X Labs. of Bentonville, Arkansas; and

  • San Corporation of Oxnard, California.

According to the complaint, UNeMed is the technology transfer entity of the University of Nebraska Medical Center (“UNMC”), and the exclusive licensee of patents filed and issued to the Board of Regents of the University of Nebraska on behalf of UNMC employees.  UNeMed’s portfolio includes U.S. Patent No. 6,897,334 and other U.S. patent applications (“UNMC IP”) relating to creatine ethyl ester used as a nutritional supplement and an anti-inflammatory.

UNeMed alleges that Vireo Systems, Inc. (“Vireo”) is a sublicensee to the UNMC IP and is the sole U.S. manufacturer of raw creatine ethyl ester.  According to the complaint, the raw materials contained in all other products advertised as containing creatine ethyl ester are manufactured outside of the U.S., primarily in China.

UNeMed further asserts that since none of the proposed respondents purchase raw creatine ethyl ester from Vireo, “they are purchasing products advertised as creatine ethyl ester from manufacturers overseas for formulation into finished nutritional supplements advertised as containing creatine ethyl ester.”  UNeMed claims to have tested the proposed respondents’ products to confirm that such products contain no creatine ethyl ester and thus, the “sales of these falsely-advertised products is a violation of section 43(a) of the Lanham Act (15 U.S.C. §1125(a)), and the Nebraska Uniform Deceptive Trade Practices Act, R.R.S. Neb. §87-302 (2008).”

Regarding domestic industry, UNeMed asserts in its complaint that it “currently offers an extensive portfolio of over 100 technologies available for licensing, and negotiates approximately 250 technology contracts per year.”  Also, UNeMed alleges to have “invested $199,121.56 in the [UNMC IP], including patent prosecution costs and maintenance fees.”  UNeMed also points to its employment of 12 full-time employees devoted to the licensing of its technology on behalf of UNMC.

UNeMed alleges that the proposed respondents’ sales of falsely-advertised products have “taken market share away from UNeMed’s licensee, Vireo, thereby reducing the royalties paid by Vireo to UNeMed for sales of raw creatine ethyl ester.”  Additionally, UNeMed asserts that Vireo is unable to compete on a cost basis with companies that sell cheaper, falsely advertised products that contain no creatine ethyl ester.

With respect to remedy, UNeMed seeks orders “a) excluding from entry into the customs territory of the United States raw material purporting to be creatine ethyl ester, but which contains no creatine ethyl ester; and b) mandating the cessation of sales and distribution by the [proposed] respondents of products formulated with imported raw materials falsely advertised as containing creatine ethyl ester.”