iOn February 27, 2013, the U.S. District Court for the Northern District of Georgia, Atlanta Division entered an order in a patent case: (1) denying the plaintiff’s motion to strike the defendant’s affirmative defenses; and (2) granting the defendants’ motion to stay the litigation pending reexamination of the patents-in-suit.
On February 27, 2013, the U.S. District Court for the Northern District of Georgia, Atlanta Division entered an order in a patent case: (1) denying the plaintiff’s motion to strike the defendant’s affirmative defenses; and (2) granting the defendants’ motion to stay the litigation pending reexamination of the patents-in-suit.
The affirmative defenses asserted are that: (1) the complaint fails to state a claim for relief; (2) defendants’ products “do not infringe any valid and enforceable claim of the patents-on-suit”; and (3) “that either one or both of the patents-in-suit are invalid.”[1] In its motion to strike those affirmative defenses, plaintiff contended that their lack of “factual underpinnings” rendered them deficient under Twombly and Iqbal.[2]
The court denied the motion to strike for two reasons. First, the court agreed with two earlier decisions holding that since one need only conform to Form 18 of the Federal Rules of Civil Procedure[3] when pleading a claim of direct patent infringement, for which “conclusory allegations” are acceptable, it would be “incongruous” to require a higher pleading standard for invalidity counterclaims.[4] Second, the Northern District of Georgia has Patent Local Rules that require a defendant to serve “detailed invalidity contentions,” thereby “‘fulfill[ing] the function of Twombly and Iqbal.’”[5]
The court’s denial of the motion to strike is consistent with a 2012 order from the Northern District of Georgia in another case, declining to apply Twombly and Iqbal to affirmative defenses. See prior post.
Turning to the motion to stay pending reexamination, the court noted that the USPTO had granted the requests for reexamination of the patents-in-suit on November 26, 2012.[6] The court rejected the plaintiff’s argument that granting a stay would be unduly prejudicial, reasoning that “Plaintiff, should it ultimately prevail, may recoup the full extend of any monetary damages suffered, including any damages resulting from Defendants’ actions during the pendency of the stay,” and that“‘[t]he general prejudice of having to wait for resolution is not a persuasive reason to deny the motion to stay.’”[7] Additionally, the court observed that the current litigation is in its “infancy,” making a stay less burdensome than if it had reached advanced stages.[8] Finally, the court found that the reexamination may simplify the issues being litigated. Thus, the court granted defendants’ motion to stay the litigation pending the reexamination proceeding in the USPTO.
The order is Adair v. Boat Dock Innovations, LLC, No. 1:12-cv-1930-SCJ (N.D. Ga. Feb. 27, 2013), written by U.S. District Judge Steve C. Jones.
[1] Adair v. Boat Dock Innovations, LLC, No. 1:12-cv-1930-SCJ, slip op. at 2 (N.D. Ga. Feb. 27, 2013).
[2] Id. (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 556 U.S. 662 (2009)).
[3] “Form 18 requires: (1) an allegation of jurisdiction; (2) a statement that the plaintiff owns the patent; (3) a statement that defendant has been infringing the patent 'by making, selling, and using [the device] embodying the patent'; (4) a statement that the plaintiff has given the defendant notice of its infringement; and (5) a demand for an injunction and damages.” In re Bill of Lading Transmission and Processing System Patent Litig., 681 F.3d 1323, 1334 (Fed. Cir. 2012) (quoting McZeal v. Sprint Nextel Corp., 501 F.3d 1354, 1357 (Fed. Cir. 2007)).
[4] Adair, slip op. at 3-5 (discussing Microsoft Corp. v. Phoenix Solutions, Inc., 741 F.Supp.2d 1156 (C.D. Cal. 2010) and Graphic Packaging Int’l, Inc. v. C.W. Zumbiel Co., No. 1:10-cv-3008-AT, 2011 WL 5829674 (N.D. Ga. Aug. 1, 2011)).
[5] Adair, slip op. at 5 (quoting Wistron Corp. v. Phillip M. Adams & Assoc., LLC, No. C-10-4458 EMC, 2011 WL 1654466 (N.D. Cal. Apr. 28, 2011)).
[6] Adair, slip op. at 5.
[7] Id. at 6 (quoting Graywire, LLC v. Ciena Corp., No. 1:08-CV-2993-BBM, 2009 WL 8590870, at *4 (N.D. Ga. July 17, 2009)).
[8] Adair, slip op. at 7.
