(CN) - NASCAR's preferred maker of head-and-neck-support devices deserves $302,000 from a competitor that infringed on its patent, in violation of a settlement, a federal judge ruled.
Robert Hubbard, a retired professor of biomechanical engineering at Michigan State, began developing the head-and-neck-support, or HANS, device in the 1980s to protect against basilar skull fractures that race-car drivers can sustain if their heads whip forward in a crash.
HANS devices sit on a driver's shoulders and attaches to the back of his helmet. ESPN reported that they won widespread support after Dale Earnhardt died from a basilar skull fracture in the 2001 Daytona 500. Earnhardt was an outspoken critic of the HANS device, referring to it as "that damn noose."
After his death, the HANS device became a mandatory safety precaution in NASCAR and Formula One racing.
Hubbard's company, HANS Performance Products, sued Kevin Heath Enterprises (KHE) in 2010 for infringing on its patent, and the companies reached a settlement the next year that required KHE to discontinue making its neck support device, the DefNder G70, or any device "no more than colorably different" from the DefNder G70.
Kevin Heath, as president of KHE, signed the agreement in his official capacity, but during negotiations, he registered a new company, NecksGen Inc., which began marketing a similar neck brace in 2012.
The NecksGen device is sold worldwide, except in Georgia, as Heath hoped to avoid another lawsuit by HANS there.
Nevertheless, U.S. District Judge William Duffey Jr. in Atlanta found Health and NecksGen in contempt of the consent order Monday because "the NecksGen device is no more than colorably different than the DefNder G70 device."
Duffey imposed sanctions of $302,000 based on HANS's lost sales.
"The evidence well-establishes Heath's intention to remain a retailer of restraint devices and his propensity to proceed to market without careful or reasonable evaluation of a product's potential to infringe the intellectual property interests of others and, specifically, those of the plaintiff," Duffey wrote.
Heath believed that he had designed the NecksGen device around HANS patent claims, but he went ahead with manufacturing and marketing the device without ever consulting a lawyer, according to the ruling.
"He was motivated, in some substantial part, by his believe that he was brining a better and safer design to the sport of racing," Duffey wrote.
"Heath's decision-making process was fundamentally flawed, negligent and arguably irresponsible," but it was not malicious and Heath thus need not face enhanced damages, according to the ruling.
Duffey also awarded HANS Products $120,000 in attorneys' fees, less than half of its "facially unreasonable" request for $280,000.
"The hours expended reflect the significant inefficiency that results often in large law firms which unreasonably staff straightforward cases and bill at well-above market rates that are inconsistent with the market for legal services of the straightforward nature involved in this contempt proceeding," Duffey wrote.HANS Products is represented by Robin Gentry with Ballard Spahr in Atlanta.