Attorney Letter 200418

The following is the attorney letter the board received on April 18, 2021 in regards to the cease and desist letter we received on a patent infringement from a members project. The original clean pdf version of the letter can be obtained by requesting it from the current board of directors. It is saved on the board drive.

Date: April 18, 2021 To: Pumping Station One Board of Directors From: Paul Winters Re: Patent Infringement Issue and Fire Safety Considerations

ATTORNEY CLIENT PRIVILEGED CONFIDENTIAL MEMORANDUM 1 INTRODUCTION

At Pumping Station: One, NFP’s (“PS:1”) request, this memorandum provides responsive guidance to address the following two issues: 1. Tyler Gilbertson’s, March 3, 2021 Cease and Desist letter (“Letter”) sent to PS:1 and alleging patent infringement of a box cutter design (“Patent”). 2. Concerning the installation and use of fire alarm systems on PS:1 premises, potential liability and related recommendations. The following paragraphs are intended to provide the PS:1 Board of Directors with guidance specifically addressing the questions by the PS:1 Board of Directors in its April 9, 2021 letter related to the above issues.

2 CEASE AND DESIST LETTER – ALLEGED PATENT INFRINGEMENT

2.1 Law Firm Qualifications and Limitations As an initial matter, while our law firm regularly provides legal counsel related to trademarks and copyrights for our nonprofit clients, we do not have experience in addressing or defending patent issues. If, in the unlikely event, PS:1 needs to defend an infringement claim or needs more specialized guidance in this area, we can make recommendations concerning patent attorneys who can provide such specialized assistance. We do, however, have substantial experience in working with federal legal scheme connected to our practice, have a strong understanding of federal law and regulatory structures. With this general knowledge base, we have reviewed applicable practice notes connected with this area and provide this initial responses to the Board’s questions concerning the Letter. 2.2 PS:1 Question: The individual issuing the Cease and Desist letter does not provide proof that the patent has been infringed, nor has Pumping Station One made any attempt to investigate the veracity of the infringement claim. Whose responsibility is it to investigate the veracity of a patent infringement claim? In an infringement action (actual litigation), the patent owner bears the burden to prove infringement. The patent owner also bears the burden of production on infringement, requiring the patent owner to present evidence to support its infringement allegations. As discussed below, we think that PS:1 has neither directly nor indirectly infringed the Patent, even if such patent exists, and is valid and applicable. Whether PS:1 seeks to investigate the patent infringement claim is within PS:1’s discretion, and may bear on whether PS:1 permits Alex to continue manufacturing the knife on PS:1 tool systems in conjunction with a disposition of the potential infringement issues between Alex and Gil-Tek, LLC (through settlement or litigation) as discussed under 2.6, below. 2.3 PS:1 Question(s): Does Pumping Station One, in its organizational capacity, bear legal and/or financial culpability for patented objects manufactured by members for their own personal OR commercial use when they do not own the patent? A patent infringement claim is an assertion by the patent owner that an accused infringer’s product or process practices the claimed invention without the patent owner’s authorization. A patent is infringed if a single claim is infringed. The distinction between personal and commercial uses appears to us to be immaterial. Both are prohibited under the U.S. Code as follows: “Except as otherwise provided in this title, whoever without authority makes, uses, offers to sell, or sells any patented invention, within the United States or imports into the United States any patented invention during the term of the patent therefor, infringes the patent.” 35 U.S.C.A. § 271 (West) There are two general types of infringement: 2.3.1 Direct infringement A party directly infringes a patent if, without authority from the patent owner, it: 2.3.1.1 Makes, uses, sells, or offers to sell a patented invention within the US. 2.3.1.2 Imports a patented invention into the US.

Based on our review of PS:1’s supplied facts, we do not think PS:1 has directly infringed on the Patent. Specifically, PS:1 has not made, used, sold or offered to sell the allegedly patented box cutters, nor has it imported such box cutters to the U.S. 2.3.2 Indirect infringement A party that does not directly infringe the patent itself may still be liable for patent infringement if it:

2.3.2.1 Actively induces another to infringe the patent. 2.3.2.2 Supplies a component or material used to infringe the patent .

To our knowledge, PS:1 has not actively induced its member Alex to infringe the Patent. Under Section 271(b), a party induces infringement if it actively and knowingly aids and abets another’s direct infringement . Therefore, inducement requires the party asserting infringement to show that the accused(indirect) infringer knowingly induced the direct infringement and had specific intent to encourage another’s direct infringement. We understand that this is not the case in PS:1’s relationship with Alex. As to the second means of indirect infringement, we understand PS:1 does not sell or offer to sell components used in the manufacture of Alex’s tools. Even if PS:1 did or does sell raw materials to its members, we understand that the materials sold are generally “raw” materials of general use and would not be of the type especially made or especially adapted for use in infringement of the alleged Patent.