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Case 1:13-cv-04138-SCJ Document 28 Filed 03/19/15 Page 1 of 22
IN THE UNITED STATES DISTRICT COURT
FORTHE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
BRUDER HEALTHCARE
COMPANY,
Plaintiff.
CIVIL ACTION NO.
1:13-cv-4138-SCI
BIGWALL ENTERPRISES, INC.
ANd
WALGREEN CO.,
Defendants.
ORDER
This matter is before the Court on Defendants BigWall Enterprises, Inc.,
and Walgreen Co.'s Motion to Dismiss the Complaint (Doc. No. [15], hereinafter
the " Motion to Dismiss").
BACKGROUND
Plaintiff Bruder Healthcare Company (the "Plaintiff") sells therapeutic
compresses and dressings under the Thermalon brand. See Doc' No. [1] at tf16.
Plaintiff also is the assigrree of U.S. Patent No. 8,420,882 (the "'882 Patenf').
See
id. at fl13. The'882 Patent issued on April 1'6,2013, and "sets forth a method of
providingmoisture therapy and/orheattherapyto a subjectby applying a moist
therapy compress against a treated body portion." See Doc. No. [1], flfl12 & 13'
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On December 13,2013, Plaintiff instituted this patent infringement action
against Defendants BigWall Enterprises, Inc. ("BigWall") and Walgreen Co.
("Walgreens") (collectively, the "Defendants"). See generally Doc. No. [1].
Plaintiff alleges that "Defendants are, and have been, infringing, contributing to
infringement, and inducing infringement of the'882 Patent by selling infringing
wound and therapy compresses and dressings to customers in the United
States," including the "Moist Heat Back Wrap" and "Moist Heat Neck Wrap"
products. See id. at tf fl14-17. According to Plaintiff, "Defendant Walgreens
previously bought [Plaintiff's] now-patented wound and therapy compresses
and dressings sold under [Plaintiff's] Thermalon brand, but stopped purchasing
the wound and therapy compresses and dressings from [Plaintif{l and instead
sourced a similar product from [Defendant] BigWall." See Doc. No. [1] at fl16.
In light of Defendants' alleged conduc! Plaintiff seeks damages and injunctive
relief for direct patent infringement (Count II), induced patent infringement
(Count I), and contributory patent infringement (Count
III).
See generalllr Doc.
No. [1].
On March 28,2074, Defendants filed the instant Motion to Dismiss (Doc.
No. [15]). Defendants argue that Plaintiff's direct patent infringement claim
2
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(Count II) cannot survive because "no single party is alleged to perform, in the
United States, all of the steps of any one of the method claims" at issue.
See
Doc.
No. [15-1], p. 1.. Defendants further argue that Plaintiff cannot succeed on its
claims for induced and contributory patent infringement (Counts
because Plaintiff has failed
II &
nD
to allege Defendants' specific intent to induce
infringement of the '882 Patent (see id. at pp. 10-13), or knowledge that
Defendants' compresses and dressings were especially made or adapted for
infringing the'882 Patent (see id. at pp. 13-14). In response, Plaintiff maintains
that it has sufficiently alleged Defendants' direct, induced, and contributory
infringement of the'882 Patent. See Doc. No. [16].
The Court has carefully considered the arguments set forth in the parties'
briefs (see Doc. Nos. [15], [16], & [19]), and for the reasons set forth herein will
DENY Defendants' Motion to Dismiss.
il.
LEGALSTANDARD
A
complaint may be dismissed Pursuant to Federal Rule of Civil
Procedure 12(b)(6)
if
the facts as pled do not state a claim for relief that is
plausibleonitsface. Ashcroftv. Iqbal,556v.5.662,679(2009)(explaining,"only
a
complaint that states a plausible claim for relief survives
J
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a
motion to dismiss");
Bell Atlantic Corp. v. Twombl)',550 U.S. 544,561,-62,570 (2007) (retiring the
prior
standard under Conley v. Gibson,355 U.S. 41,45 -46 (1957),which provided that
a complaint should not be dismissed "unless
it appears beyond doubt that the
plaintiff can prove no set of facts in support of his claim which would entitle him
to relief.").
In Iqbal, the Supreme Court reiterated that although Rule 8 of the Federal
Rules
of Civil Procedure does not require detailed factual
allegations, it
nevertheless demands "more than an unadomed, the-defendant-unlawfully-
harmed-me accusation." 556 U.S. at 678. ln Twombly. the Supreme Court
emphasized that
a
complaint "requires more than labels and conclusions, and a
formulaic recitation of the elements of
a cause
of action will not do." 550 U.S. at
555. Factual allegations in a complaint need not be detailed, but "must
be
enough to raise a right to relief above the speculative level on the assumption
that all the allegations in the complaint are true (even i{ doubtful
n
lact)." ld.
(internal citations and emphasis omifted).
In ruling upon a motion to dismiss, a court must accePt all well-pleaded
facts in the complaint as true, and also must construe those facts in the light most
favorable to the non-moving party. See Miyahira v. Vitacost.com, lnc', 715 F'3d
4
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1257, 1265 (11th Cir. 2013); Linder v. Portocarrero, 963 F.2d 332, 334 (11th Cir.
1ee2).
ilI.
ANALYSIS
Defendants argue that Plaintiff's claims for direct infringement (Count II)
and indirect infringement (Counts I & III) should be dismissed. The Court
will
address these arguments in turn.
A.
Count
ll-Direct
Infringement Under 35 U.S.C. $ 271(a)
The Federal Circuit has repeatedly held that when considering motions to
dismiss, "[d]istrict courts must evaluate complaints alleging direct infringement
by reference to Form 18 of the Appendix of Forms to the Federal Rules of Civil
Procedure." See K-Tech Telecomms., Inc. v. Time Warner Cable, hrc., 71.4F.3d
1277,1279 (Fed. Cir. 2013) (reversing dismissal of direct patent inJringement
claim that satisfied Form 18), cert. denied sub nom., DIRECTV v. K-Tech
Telecomms., Inc., 134 S. CL 1026 (201,4); see also; Superior Indus., LLC v. Thor
Global Enterprises Ltd., 700 F.3d 1287 ,1295 (Fed. Cir. 2012) (observing that for
direct patent infringement claims, "Form 18 of the Federal Rules of Civil
Procedure provides the pleading standard"); In re Bill of Lading Transmission
& Processing sys. Patent Litig., 681 F.3d 1323,1334 (Fed. Cir. 2012) (observing
5
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that the adequacy of
a
claim for direct patent infringement "is to be measured by
the specificity required by Form 18").1 Plaintiff likewise argues that to plead
direct infringement, it may "rely on the format provided in Form 18 of the
Federal Rules of Civil Procedure." See Doc. No. [16], pp. -5 (citing Superior, 700
F.3d at 1295).
Form 18 sets forth five pleading requirements for a claim of direct
infringement:
jurisdiction; (2) a statement that the
plaintiff owns the patent (3) a statement that
defendant has been infringrng the patent'by making,
selling, and using [the device] embodying the patenf;
(4) a statement that the plaintiff has given the
(1) an allegation of
1
The Court recognizes that, as Defendants have argued, there is some "conflict
between the decades old Form 18 . . . and the recently clarified pleading standards of
Twombley and lqbal." See Doc. No. [19], p. 2; see also, e.9., Macronix Int'l Co. v.
Spansion Inc.. No. 3:13-CV-679, 2014 WL 934505 (E.D. Va. Mar. 10, 2014) ("The
threshold problem with [the Federal Circuit's decisions regarding Form 18] is that they
accord no force to either the text or teaching of Twombly and Iqbal which tequire more
to plead a legally sufficient claim than is set out in Form 18."). Nevertheless, grven the
Federal Circuit's insistence on this point, as well as the lack of a clearly contrary
decision from either the Supreme Court or the Eleventh Circuit, the Court will review
Plaintiff's claims for direct infringement according to the pleading requirements set
forth in Form 18. See. e.9., CBT Flint Partners. LLC v. Goodmail Sys., Inc., 529 F. Supp.
2d,1376,1379 (N.D. Ga.2007) (analyzing a direct patent infringement claim according
to the requirements set forth in the Appendix of Forms of the Federal Rules of Civil
Procedure, observing that " [t] he Eleventh Circuit has not decided whether Truo mbly has
altered pleading standards in the patent context" and that given the Federal Circuif s
exclusive jurisdiction over patent appeals, "it is not likely to do so.").
6
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defendant notice of its infringemenq and (5)
for an injunction and damages.
See Bill
a
demand
of Ladins. 681 F.3d 1323.1334 Ged.Cir.2012) (ouotins McZeal v. Sorint
Nextel Coro..501 F.3d 1354.1357 (Fed.Cir.200n (alteration in orisinal));
see
also
Superior, 700 F.3d at7295; see also Fed. R. Civ. P. Form 18. Plaintiff argues that
its "claim for direct infringement against each of the Defendants" is predicated
on "traditional notions of infringement following the standard format of
Form 18." See Doc. No. [16], p. 7. And after citing allegations in its Complaint
that it believes address "all five (5) of Form 18's pleading requirements," Plaintiff
concludes that its claim for direct infringement must survive Defendants' Motion
to Dismiss. See Doc. No. [16], pp.4-8.
The Court agrees. Plaintiff's Complaint sets forth factual allegations
regarding jurisdiction (cce Doc. No. [1], ![fl1- ); Plaintiff's ownership of the
'882 Patent (ccc
t4
at tf fl12-13); Defendants' purportedly-infringing activities
(s"" la. at !f '[8-11, 74-17, 20, 23, 25, & 43-48); Plaintiff's provision of notice to
Defendants regarding the purported infringement (sec ia. at ll22-29); and
claims for damages and injunctive relief (see id. at
lf
'1f
62-68). Plaintiff's claim for
direct infringement thus satisfies the requirements of Rule 18, and is "effectively
immunize[d] . . . from attack regarding the sufficiency of the pleading." 9cc
7
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K-Tech Telecomms.. Inc. v. Time Wamer Cable. Inc., 774F.3d1277,1283 (Fed.
Cir. 2013); see also Sikes Cookers & Grill. Inc. v. Vidalia Outdoor Products, Inc.,
No. 1:08-CV-0750-1OF,2009WL427227, at*3 (N.D. Ga. Feb. 1.9,2009) (refusing
to dismiss direct patent infringement claims where
"Plaintiff s complaint clearly
states that Plaintiff owns the [patents-in-suit]; Defendants have been making,
selling, and using
a
product embodying these patents; Defendants have done so
in this judicial distric! Plaintiffs have given Defendants notice of the violation;
and Plaintiffs are demanding damages.").
Defendants acknowledge that conJormance with Form 18 can "satisfy the
pleading requirements for direct infringement" and even admit that the
Complaint alleges that Defendants have directly infringed the '882 Patent "in
support of their sales efforts for such products." See Doc. No. [19], pp.
2;
Doc. No. [15-1], pp. 7-10 (quoting Doc. No. [1], '1T!]45-54. Nevertheless,
Defendants argue that such allegations are "speculative, at best " and therefore
"do not give rise to a plausibility of entitlement to relief for direct infringement."
SeeDoc. No. [15-1],pp.8-11. Specifically,DefendantsarguethatforPlaintiff
"to
plausibly plead that the alleged testing by Defendants of their products directly
infringes the method claims of the'882 patent, [Plaintiffl must allege facts that
8
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plausibly suggest that Defendants perform the step of providing loose fill
granules comprising a zeolite." See Doc. No. [19], pp. 3-5.
But
" Form 18 and the Federal Rules of Civil Procedure do not require a
plaintiff to plead facts establishing that each element of an asserted claim is me!"
and in fact, "a plaintiff need not even identify which claims it asserts are being
infrinsed."
See In re
Bill of Ladins Transmission & Processins Svs. Patent Litie.,
681 F.3d 1323,1335 Ged. Cir. 2012) (citins McZeal v. Sprint Nextel Corp., 501
F.3d 1354, 1357 (Fed. Cir.
2004). It is only necessary that "the complaint in
question contains sufficient factual allegations to meet the requirements of
in
which case "the complaint has sufficiently pled direct
infringement."
See BiIl of Ladins,681 F.3d at1336; see also CBT Flint Parkrers.
Form 18,"
LLC v. Goodmail Sys.. Lrc.. 529 F. Supp. 2d1376,1380 (N.D. Ga.2007) (refusing
to dismiss patent claims that were not "appreciably different'' than
the
"extremely barebones factual allegations identifying the patent and the
infringing producy' set forth in the Appendix of Forms to the Federal Rules of
Civil Procedure).
For the reasons discussed above, the Court finds that the allegations of
direct infringement that are set forth in Count II of Plaintiff s Complaint satisfy
9
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the requirements of Form 18. Nothing more is required at the pleading stage,
and Defendants' Motion to Dismiss Count II is therefore DENIED.
B.
Counts I & III-Indirect Infringement
Under 3s U.S.C. $$ 271(b) & (c)
It is clear that " [t]here can be no inducement or contributory infringement
without an underlying act of direct infringement." See Bill of Lading. 681 F.3d
1323,
-1333
(Fed. Cir. 2012) (quoting Linear Tech. Corp. v. Impala Linear Corp.,
379 F.3d 1311,, 1326 (Fed.Cir.2004)). Given this, Defendants have argued that
because the "Complaint fails to plausibly allege that the'882 patent was directly
infringed," Plaintiff's "indirect infringement claims cannot survive Defendants'
Motion to Dismiss."
See
Doc. No. [19], pp.5-7. Accordingly, the Courtmustfirst
determine whether Plaintiff has satisfactorily alleged direct infringement of the
'882 Patent as a predicate to its claims for induced and contributory infringement.
See Bill of Ladins, 681 F.3d at1333-34.
In its Complaint Plaintiff
alleges that Defendants' customers have
committed predicate acts of direct infringement that support Plaintiff's claims for
induced and contributory infringement. See Doc. No. [1], flfl39 & 56. And
although Plaintiff does not name specific customers,
Plaintilf to "identify
a specifc direct
(Rev.8/82)
is not necessary for
infringer if it pleads facts sufficient to allow
10
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it
an inference that at least one direct infringer exists." See Bill of Lading. 681 F.3d
at 1336 (emphasis in original). Rather, it is enough that Plaintiff's claims
regarding the predicate direct infringement satisfy the requirements of Form 18.
See
jdJ see also Swipe Innovations. LLC v. NCR Corp.. No. 1:13-CV-2219-TV{T,
2013
WL 6080439, at *3 (N.D. Ga. Nov. 18,2013) ("The Plaintiff alleges that the
Defendant's 'customers andf or suppliers' are the direct infringers. Greater
specificity is not required at this stage." (citations omitted)).
The Court finds that these requirements are satisfied by Plaintiff's
allegations that "[u]se of the wound and therapy compresses and dressings
oroducts bv purchasers of Defendants' wound and theraov compresses and
dressings products . . . satisfies every feature of at least one claim of [the'882
Patentl, such that the Defendants' products and the customey's use thereof
infringe the '882 Patent." See Doc. No. [1], flfl39 & 56 (emphasis added).2
2
As discussed supra in Part III.A., Form 18 lists five Requirements for pleading
claim of direct infringement. See Bill of Ladine, 681 F.3d at 1334, Of these, the First
(allegation of jurisdiction), Second (statement that plaintiff owns the patent) and Fifth
(demand for injunction and damages) are the same regardless of whether Defendants
or their customers are the accused direct infringers, and in the context of indirect
infringement the Fourth ("notice") requirement simply means that Defendants (as the
accused "indirect" infringers) must receive notice of Plaintiff's claims for indirect
infringement. Thus, any claim that Defendants' customers have committed predicate
acts of direct infringement will satisfy Rule 18 so long as the Third Requirement is
likewise satisfied by allegations that the customers "ha[ve]been infringing the patent
'by making, selling, and using [the device] embodying the patent."'
a
11
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Plaintiff having thus set forth a claim for direct infringement (by Defendants'
customers) that may serve as a predicate for Plaintiff's claims for indirect and
contributory infringement, the Court will now consider the parties' remaining
arguments with respect to each of those claims.
7.
Count l-lniluceil Infringement
Unilet 35 U.S,C. S 277(b)
To state a claim for induced infringement under 35 U.S.C. S 271.(b), a
plaintiff must allege facts "plausibly showing that [the defendants] specifically
intended their customers to infringe the [patent-in-suit] and knew that the
customer's acts constituted inJringement." See In re Bill of Lading Transmission
& ProcessingSvs. Patent Litig.. 681F.3d1323,1339 (Fed. Cir. 2012). Liability for
induced infringement thus requires the accused infringer to have "knowledge
that the induced acts constitute patent infringement," or to have "willfully
blinded itself to the inlringing nature" of those acts. Global-Tech Appliances,
Inc. v. SEB S.A., 131 S. Ct. 2060,2068-72 (2011). But although "proof of intent is
necessary, direct evidence is not required; rather, circumstantial evidence may
suffice." Water Techs. Corp v. Calco. Ltd., 850 F.2d 660, 668 (Fed.Cir.1988).
Accordingly, " [e]vidence of active steps taken to encourage direct infringement,
such as advertising an infringing use or instructing how to engage in an
12
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infringing use, show an affirmative intent that the product be used to infringe."
MEMC EIec. Materials. Inc. v. Mitsubishi Materials Silicon Corp.. 420F.3d1369,
1379 (Fed. Cir. 2005) (emphasis added) (quoting
Metro-Goldwyn-Mayer Studios
Inc. v. Grokster, Ltd., 125 S. Ct. 2764,2768 (2005)); see also Microsoft Corp. v.
DataTem. Inc., 755F.3d899,905 (Fed. Cir. 2014) ("Providing instructions to use
a product in an
infringing manner is evidence of the required mental state for
inducing infringement."); AstraZeneca LP v. Apotex. Inc., 633 F.3d 1042, 1060
(Fed. Cir. 2010) (affirming dishict court's finding that induced infringement
claim would likely succeed on the merits where defendant's instructions "would
inevitably lead some consumers to practice the claimed method").
In this case, Plaintiff argues that intent to induce infringement can be
plausibly inferred from the Complain{s factual allegations conceming
Defendants' "knowledge of the'882 Patent " and efforts to "provide[] customers
with instructions for using the products in an infringing manner."
See Doc. No.
[16], pp.9-10 (citing Doc. No. [1,], nfl22-25). The Court agrees-Plaintiff has
provided specific allegations from which it is reasonable to infer that Defendants
were aware of the '882 Patent
3
that Defendants sold products, including the
3
For example, Plaintiff has alleged that Defendants "previously bought
[Plaintiffs] now-patented wound and therapy compresses and dressings" but now
"sourcefl a similar product from [Defendant] BigWall" (Doc. No. [1] at tf 16); "had actual
knowledge of the '882 Patent at least as early as October 3,2013, when Defendant
13
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72l
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"Moist Heat Back Wrap" and "Moist Heat Neck Wrapi' with instructions that
were intended to cause their customers to use those products in ways that
infringed the'882 Patent " and that Defendants knew that their customers would
be
infringing the'882 Patent by using the products
as instructed.s This is enough
to set forth a claim for induced infringement of the '882 Patent. See ln re Bill of
Ladins Transmission & Processins Svs. Patent Litie.. 681 F.3d1323,1344 (Fed.
Cir. 2012) (reversing district courf
s
dismissal of
a
claim for induced infringement
against defendant that regularly hosted customer seminars at which potentially-
infringing uses of a product were demonstrated); MEMC Elec. Materials. Inc. v.
Mitsubishi Materials Silicon Corp.. 420F.3d1369,1379 (Fed. Cir. 2005) (reversing
summary judgment of no induced infringement because genuine issues of fact
remained in light of defendan(s "substantial technical supporf' conceming
"potentially infringing activities.").
Walgreens was informed by letter that [Plaintiffl had patents on such and requested
that Walgreens cease its iffiinging activities" (ul. at 122); and "knew about the
Plaintiffs patent and was aware of Plaintiff's products in the marketplace [and] sold
Plaintiffs products since before Defendant Walgreens decided to market a similar
product" (id. at !ftf27 & 28).
n
For example, Plaintiff has alleged that Defendants have "instruct[ed]
purchasers of the wound and therapy compresses and dressings products to use the
products in a method which infringes the '882 Patent " by providing inshuctions that
"are included in the materials sold with the wound and therapy compresses and
dressings products sold by Defendants" (Doc. No. [1] at lftf37 & 38), and have thus
advertised, marketed, and sold products "with the specific intent that the ultimate
customer will infringe the'882 Patent" (!g! at t[40; see also nn14,15, &14.
u
fu
s,rpra rrotes 3 & 4 and accompanying text.
1,4
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Defendants argue that because they "do not believe that their product
includes
'fill
granules comprising a hydrophilic zeolite,"' they cannot have
"specifically intended their customers to infringe the '882 patent." See Doc.
No. [15-1], p. 12. But in considering Defendants' Motion to Dismiss, the Court
must construe all facts in the light most favorable to the Plaintiff. See Milzahira
v. Vitacost.com. Inc.. 715 F.3d 1257,1265 (11th Cir. 2013). Defendants' claims
regarding the "fill granules" used in their products thus canno! at this stage of
the case, trump Plaintiff s allegations conceming Defendants' knowledge of the
'882 Patent, and instructions to customers regarding potentially infringing
product uses.
For the reasons discussed above, the Court finds that Plaintiff has
sufficiently alleged
a claim for induced infringement and
accordingly
Defendants' Motion to Dismiss Count I is DENIED.
2.
Count III
-
Contributory lnfringement
Under 35 U.S.C. S 277(c)
To state a claim for contributory infringement under 35 U.S.C.
S 271.(c), a
plaintiff must allege sufficient facts from which it may be reasonably inferred
that the defendant
sells or offers to sell, a material or apparatus for use in
practicing a patented process, and that 'material or
apparatus' is material to practicing the invention, has
no substantial non-infringing uses, and is known by
15
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party'to
be especially made or especially adapted
for use in an inlringement of such patent.'
the
See In re Bill of Ladine Transmission
& Processine Svs. Patent Litie., 681 F.3d
'1323,'1337 (Fed. Cir. 2012) (quoting 35 U.S.C.
$271.(c)) (citing Cross Med. Prods..
Inc. v. Medtronic Sofamor Danek. Inc., 424F.3d1293,1312 (Fed.Cir.2005)). It is
plausible to conclude that
a
defendant knew the accused device "to be especially
made" to infringe the patent-in-suit where the plaintiff "plead[s] facts that allow
an inference that the components sold or offered for sale have no substantial
non-infrinsinq uses. See Bill of Ladine. 681 F.3d at'1337 (citine Cross Med.
Prods..424 F.3d at 1312). Thus, while induced infringement provides for liability
where the defendant has "an affirmative intent to cause direct infringemen!"
contributory liability may be established in cases where an accused product "can
only rnfurnge," because in such cases "the inference that infringement is intended
is unavoidable." See Ricoh Co. v. Ouanta Computer Inc.,550 F.3d 1325,1336-39
(Fed. Cir. 2008) (emphasis
in original) (explaining that the Supreme Court's
decision in Metro-Goldwyn-Mayer Studios L:rc. v. Grokster. Ltd..545 U.S. 913
(2005) "made clear that the purpose
of the 'substantial noninfringing
use'
exception of $ 271,(c) is to allow determination of instances where the intent to
infringe may be presumed based on the distribution of a product that has an
unlawful use.").
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As discussed above, Plaintilf has sufficiently alleged direct infringement
by Defendants' customers as the predicate to its contributory infringement claim.
With respect to this claim, Plaintiff further alleges that Defendants' products "are
especially made and specifically adapted for use in a manner that infringes the
'882Patent," and that Defendants are aware of this fact. See Doc. No. [1], '!f 15,
53, &
58. As evidence of this, Plaintiff cites "[t]he instructions provided along
with these products," which according to Plaintiff, "instruct the user to utilize the
products
in a marrner that infringes the '882 Patent."
See Doc.
No.
[1],
flt]14-15, 53-54,56. Plaintiff also has appended to its Complaint examples of
advertisements and product packaging for the "Moist Heat Neck Wrap" and
"Moist Heat Back Wrap" products that Defendants are alleged to have sold.
id.
at'1f 17
See
and pp. 6-12; see also Doc. No. [1-3]. Finally, Plaintilf alleges that such
products "are not staple articles or commodities of commerce suitable for
substantial non-infringing use." See id. at tf57.
Taken at face value, these allegations would appear to set forth
a
plausible
claim for contributory infringement. Nevertheless, Defendants argue that
Plaintiff cannot plausibly allege that the products at issue have no substantial
non-in{ringing uses because "the accused products can be used for purposes
other than infringement, e.9., for cold therapy," and thus Plaintiff "cannot
establish a requisite element of contributory patent infringement." See Doc. No.
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[15-1], p. 14; Doc. No. [19], p. 7. As suclL Defendants argue that Plaintiff's claim
for contributory infringement should be dismissed under the reasoning set forth
in Bill of Lading, in which the Federal Circuit affirmed the dismissal of a
conhibutory infringement claim on facts that are somewhat similar to those at
issue here. See Doc. No. [19'|, p. 7 (citing ln re Bill of Lading Transmission &
Processing Sys. Patent Litig.. 681 F.3d 1323 (Fed. Cir.2012)).
In
response, Plaintiff argues that Defendants' claim
of
substantial
noninfringing uses "amounts to nothing more than a denial" which cannot
succeed "at this early stage where the patent claims have not been construed and
the various uses have not been categorized as infringing or
not."
See Doc.
No. [16], p. 12. But this fails to squarely address whether, as Defendants have
maintained, the very factual allegations that Plaintiff has chosen to include in its
Complaint provide evidence of substantial noninlringing uses that can provide
a basis
for dismissing Plaintiffs claim for contributory infringement under Bill
of Lading. See Doc. No. [19], p. 7; see also Doc. No. [15-1], pp. 13-15 (providing
arguments regarding noninfringing uses).
Bill of Lading involved a plaintiff's allegations that "as customized by the
relevant [defendant] for their trucking customers," an accused process "has no
other substantial non-infringing use." See 681 F.3d at 1338 (internal quotation
marks omitted). However, the plaintiff's complaint also included "repeated
18
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descriptions of non-infringing uses to which the accused products can be put."
See
id. Given
these "non-infringing uses," the Federal Circuit observed that the
plaintiff's contributory infringement claim boiled down to an assertion that if the
process were used
"to perform the patented method," the
"infringe and has no noninfringing uses."
See
process would
Bill of Lading. 681 F.3d at 1338.
Such a claim could not survive, however, because
[t]he fact that a product may be unavailable {or
simultaneous noninfringing uses while being used to
infringe, is not determinative. Where the product is
equally capable of, and interchangeably capable of
both in-fringing and substantial non-inJringing uses, a
claim for contributory infringement does not lie.
See
id.
The Federal Circuit accordingly dismissed the claim for contributory
infringement, observing that plaintiff's complaint "supplie[d] the very facts
which defeat its claims of contributory infringement." See id.
Defendants maintain that "intent to infringe" likewise cannot be inferred
in this case, because the Defendants' products are equally and interchangeably
capable of inlringing and noninfringing uses. Pointing to the factual allegations
set forth in Plaintiff's Complaint, Defendants argue that
it is evident that Defendants' product can be used for
Cold Therapy, wherein the product is simply placed in
a fueezer safe bag and put in a freezer overnight, and
then removed and used (Complaint, Ex. 3). This use
clearly is a noninfringing use as the product is neither
exposed to a source of moisture (as required by Claims
19
AO 724
(Rev.8/82)
of the'882 patent), nor heated (as required by
Claims 3 and 4 of the'882 patent).
1 and 2
See Doc.
No. [15-1], p. 14. Defendants thus observe that "the accused products
can be used for purposes other than infringement, e.9., for cold therapy," and
note that under !!!l-pf-!49!49 where a product is equally capable of both
inlringing and non-infringing uses, "a claim for contributory infringement does
not
lie."
See Doc.
No. [19], p. 7 (citing Bill of Lading. 681 F.3d at 1338). Given
this, Defendants conclude that "the Complaint fails to plausibly show that
Defendants engaged in contributory infringement of the'882 patent." See id.
In considering the parties' arguments on this
poin!
the Court is "required
to analyze the facts plead in the . . . complaint[] and all documents attached
thereto with reference to the elements of a cause of action for contributory
infringement to determine whether [the] claims of contributory infringement
[are] in fact plausible." See Bill of Lading.681 F.3d at1337. The Court has
accordingly reviewed the factual allegations in the Complaint, including the
product descriptions cited therein. Having done so, the Court finds that
although there are similarities between the factual allegations set forth in
Plaintiff's Complaint and those at issue in Bill of Lading, there are still key points
of difference.
Most importantly, the Court finds that this case differs from Bill of Lading
because Plaintiff has not alleged facts from which
20
AO 724
(Rev.8/82)
it must be concluded that
Defendants' products are "equally capable of, and interchangeably capable of
both infringing and substantial non-infringing uses." See Bill of Lading. 681 F.3d
at 1338. This is because the Court carmot be certain that, as Defendants have
argued, the use of the accused products for "Cold Therapy" would necessarily
be "a
...
noninfringing use
as the
product is neither exposed to a source of moisture
nor heated." See Doc. No. [15-1], p. L4. For one thing, it is not clear that use
of the accused products according to the Defendants' instructions regarding
"Cold Therapy"o would not, as a factual matter, involve "exposure to a source
of water." And the fact that Defendants have chosen to name their accused
products "Moist Heat Neck Wrap" and "Moisl! Heat Back Wrap" (Eec Doc. No.
[1-3] (emphasis added)) suggests that, regardless of whether the accused
products are used for "Heat Thercpy" or "Cold Therapyi' rhey necessarily are
intended to deliver moisture. The considerations above are in stark contrast to
the situation in Bill of Lading. in which the plaintiff's own complaint contained
"repeated descriptions of non-infringing uses to which the accused products can
be
out."
See
Bill of Ladine.681 F.3d at1337.
Given these distinctions from Bill of Ladin& and construing all factual
allegations in the light most favorable to the Plaintiff, the Court cannot be certain
5
"For cold therapy: Place wrap in freezer safe bag and put in freezer overnight.
Remove wrap from freezer bag and place on affected area for no longer than 20
minutes." See Doc. No. [1], pp. 7 & 11.
21]
AO 724
(Rev.8/82)
that use of the accused products for "Cold Therapy" is necessarily
a
substantial,
non-infringing use. And because the Court finds Defendants' remaining
arguments conceming the sufficiency
of Plaintiff's claim for contributory
infringement to be unpersuasive, Defendants' Motion to Dismiss Count III must
be DENIED.
TV.
CONCLUSION
For the reasons discussed above, the Court find that Plaintiff has set forth
plausible claims for direct, induced, and contributory patent infringement. Given
this, Defendants' Motion to Dismiss the Complaint (Doc. No. [15]) is hereby
DENIED, and the parties are DIRECTED to proceed according to the
instructions set forth in the Court's September 9, 201'4Order Postponing Dates
for Claim Construction Proceedings (Doc. No. [27]).
IT IS SO ORDERED, this /
?ll
day of Marclu
HONORABLESTEVE
UNITED STATES DIS
22
AO 724
(Rev.8/82)
201.5.
.IONES

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