United States District Court, D. Arizona
G. Campbell United States District Judge
Ibiden U.S.A. Corporation and Ibiden Co. Ltd. (collectively,
“Ibiden”) and Intel Corporation have filed
separate motions to dismiss Plaintiff Continental Circuits
LLC's complaint under Federal Rule of Civil Procedure
12(b)(6). Docs. 49, 52. After the motion was fully briefed
(Docs. 49, 52, 54, 58, 60) and scheduled for oral argument,
Plaintiff filed an amended complaint (Doc. 95). The Court heard
oral argument on February 3, 2017. For the following reasons,
Defendants' motions to dismiss will be granted in part
and denied in part.
alleges that Ibiden and Intel infringed four of its patents
directly, indirectly by inducing and contributing to
infringement, and willfully. See Doc. 95,
¶¶ 120-55. The Court will recount Plaintiff's
factual allegations, which must be taken as true for purposes
of this motion. See Cousins v. Lockyer, 568 F.3d
1063, 1067 (9th Cir. 2009) (citation omitted).
Circuits Inc. was a manufacturer of printed circuit boards
used in the computer industry. Doc. 95, ¶ 22. Four
employees of Continental Circuits Inc. observed that
electrical devices made of alternating layers of conductive
and non-conductive materials suffered from poor adhesion that
caused the layers to separate. Id., ¶ 28. The
employees invented a “novel surface roughening
technique” that used etching to produce a
“non-uniformly roughened surface” and allowed for
stronger adhesion between layers. Id., ¶¶
28, 110. In 1997, the co-inventors filed an application to
patent the surface-roughening technology. Doc. 52, at
Continental Circuits Inc. employee, sales representative Jeff
Long, learned of this technology in the mid-1990s. Doc. 95,
¶ 29. Plaintiff alleges that Long, before his discharge
from Continental Circuits Inc. in 1997, “entered into a
business arrangement” with Defendant Ibiden, a
manufacturer of package substrates used in computer
electronics. Id., ¶¶ 30, 44. In the course
of this “arrangement, ” Long allegedly shared the
technology described in the 1997 patent application with
Ibiden. Doc. 52, at 6; Doc. 95, ¶¶ 30-32;.
“In the late 1990s, ” Ibiden was supplying an
increasing quantity of package substrates to Intel, a global
computer-processor manufacturer, and other companies. Doc.
52, at 6; Doc. 95, ¶¶ 33, 43, 147. Like all of
Intel's suppliers, Ibiden collaborated with Intel to
develop specifications that Ibiden's products were
expected to meet. Doc. 95, ¶¶ 45-47.
application to patent the surface-roughening technology
became U.S. Patent No. 6, 141, 870 (the “'870
patent”), issued November 7, 2000, and U.S. Patent No.
6, 700, 069 (the “'069 patent”), issued March
2, 2004. See id., ¶¶ 12-13. In early 2005,
“a representative of Continental Circuits” sent a
letter to Intel's Chief Legal Counsel, informing him of
the existence of the '870 and '069 patents and a
related continuation application. Id., ¶ 34.
The representative expressed an interest in licensing the
portfolio to Intel. Id. In a letter dated March 2,
2005, an Intel employee acknowledged receipt of the letter
and stated that “[a]n Intel attorney is reviewing the
matter.” Id., ¶ 36. On April 21, 2005,
Intel sent another letter advising the representative that
“Intel has determined not to pursue this matter.”
Id., ¶ 37.
received the same offer in early 2005. See id.,
¶ 35. “[A] representative of Continental
Circuits” sent a letter to the General Counsel of
Ibiden Circuits of America, purporting to inform him of the
existence of the '870 and '069 patents and the
continuation application, and expressing an interest in
licensing the portfolio to Ibiden. Id. The amended
complaint does not mention a response from Ibiden.
continuation application referenced in the letters to Ibiden
and Intel resulted in issuance of the four patents at issue
in this action: U.S. Patent No. 7, 501, 582 (the
“'582 patent”), issued March 10, 2009; U.S.
Patent No. 8, 278, 560 (the “'560 patent”),
issued October 2, 2012; U.S. Patent No. 8, 581, 105 (the
“'105 patent”), issued November 12, 2013; and
U.S. Patent No. 9, 374, 912 (the “'912
patent”), issued June 21, 2016. See id.,
¶¶ 14-17, 34-35. In 2014, “it was
confirmed” during a “conversation . . . between a
representative of Continental Circuits and a business
development manager at Ibiden” that “the
technology claimed in the patents-in-suit is still in use at
Ibiden today.” Id. ¶ 41. When pressed for
specifics, “the Ibiden manager became evasive and ended
the discussion.” Id.
The Infringement Complaint.
initiated this action on June 22, 2016, one day after the
'912 patent was issued. See Doc. 1, ¶ 17.
The complaint sets forth one patent infringement count each
against Ibiden and Intel, alleging direct infringement,
induced infringement, and contributory infringement of the
four patents-in-suit. Doc. 95, ¶¶ 120-55. The
complaint also alleges that the infringement was willful.
Id., ¶¶ 136, 154.
amended complaint implicates hundreds of products and
hundreds of patent claims. The complaint defines
“Accused Instrumentalities” to include “any
version” of products from nine Intel product lines:
Atom, Core, Pentium, Celeron, Xeon, Itanium, and Quark series
processors, and “any processors manufactured in a
manner similar to those, ” and also Intel's
Chipsets and Wireless Network Adapters. Doc. 95, ¶ 103.
The amended complaint lists model numbers of individual
products comprising each of these product lines. See
id., ¶¶ 51, 56, 61, 66, 71, 76, 81, 86, 91.
Plaintiff claims that “any” of the products in
these product lines - more than 1, 000 total - “meet or
embody the limitations of at least one claim” of the
patents-in-suit. Doc. 52, at 5; Doc. 95, ¶ 103; see,
e.g., Doc. 95, ¶¶ 52-55 (allegations as to
Atom series). The four patents contain 337 total claims. Doc.
49, at 2; Doc. 52, at 5. The amended complaint identifies,
“by way of example and not limitation, ” claim 14
of the '560 patent as representative. Doc. 95,
¶¶ 122, 141. The term “Accused
Instrumentalities” also encompasses “any Package
Substrates manufactured by Ibiden for Intel or
others.” Id. ¶ 103 (emphasis added).
amended complaint includes magnified cross-section images of
the roughened surface between conductive and non-conductive
layers from five of Intel's product lines: Core, Atom,
Pentium, Celeron, and Xeon. Id. ¶ 107. It does
not include cross-section images from the Itanium or Quark
series processors, the chipsets, or the wireless network
adapters. In an effort to tie the images to these products,
the amended complaint alleges that “[t]he images . . .
are representative of the cross-sections of a substrate layer
within each of the Accused Instrumentalities, ” and
that “[t]here is no material difference in the
substrate layers between any versions of the Accused
Instrumentalities.” Id., ¶¶ 108-09.
Plaintiff “rel[ies] on the cross-section images of the
majority of the accused product lines for a factual basis
supporting its contentions of infringement.” Doc. 54,
successful motion to dismiss under Rule 12(b)(6) must show
either that the complaint lacks a cognizable legal theory or
fails to allege facts sufficient to support its theory.
Balistreri v. Pacifica Police Dep't, 901 F.2d
696, 699 (9th Cir. 1988). A complaint that sets forth a
cognizable legal theory will survive a motion to dismiss as
long as it contains “sufficient factual matter,
accepted as true, to ‘state a claim to relief that is
plausible on its face.'” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim has
facial plausibility when “the plaintiff pleads factual
content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct
alleged.” Id. at 678 (citing Twombly,
550 U.S. at 556). “The plausibility standard is not
akin to a ‘probability requirement, ' but it asks
for more than a sheer possibility that a defendant has acted
unlawfully.” Id. (citing Twombly, 550
U.S. at 556).
and Intel argue that Plaintiff's direct infringement
claims should be dismissed because Plaintiff has not pled
sufficient facts to make the claims plausible. Doc. 49, at
2-3; Doc. 52, at 5. They also argue that the inducement,
contributory infringement, and willfulness claims fail if the
direct infringement claims fail, and, in any event, that
Plaintiff has not alleged facts to support the state of mind
required for these claims. Doc. 49, at 3; Doc. 52, at 5.
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” is liable for direct infringement. 35
U.S.C. § 271(a). Section 271(g) extends direct
infringement to patented processes: “[w]hoever without
authority imports into the United States or offers to sell,
sells, or uses within the United States a product which is
made by a process patented in the United States” is
Direct Infringement Pleading after Form 18.
its abrogation on December 1, 2015, Rule 84 of the Federal
Rules of Civil Procedure directed that “[t]he forms in
the Appendix suffice[d]” at the pleading stage. Form 18
provided a sample complaint for patent infringement, and
courts considering the sufficiency of patent infringement
complaints compared them to Form 18. e.Dig. Corp. v.
iBaby Labs, Inc., No. 15-5790, 2016 U.S. Dist. LEXIS
111689, at *4 (N.D. Cal. Aug. 22, 2016). “[T]o the
extent any conflict exist[ed] between Twombly (and
its progeny) and the Forms regarding pleading requirements,
the Forms control[led].” K-Tech Telecomms. v. Time
Warner Cable, Inc., 714 F.3d 1277, 1283 (Fed. Cir.
Form 18 was abrogated along with Rule 84 and the rest of the
forms, it no longer maintains any force. e.Digital,
2016 U.S. Dist. LEXIS 111689, at *5-8; accord Avago
Techs. Gen. IP (Sing.) PTE Ltd. v. Asustek Comput.,
Inc., No. 15-4525, 2016 U.S. Dist. LEXIS 55655, at
*12-13 (N.D. Cal. Apr. 25, 2016); Atlas IP LLC v. Pac.
Gas & Elec. Co., No. 15-5469, 2016 U.S. Dist. LEXIS
60211, at *4 (N.D. Cal. Mar. 9, 2016); InCom Corp. v.
Walt Disney Co., No. 15-3011, 2016 U.S. Dist. LEXIS
71319, at *5-6 (C.D. Cal. Feb. 4, 2016). In Form 18's
absence, Twombly and Iqbal govern direct
infringement claims. FootBalance Sys. v. Zero Gravity
Inside, Inc., No. 15-1058, 2016 U.S. Dist. LEXIS 137978,
at *6 (S.D. Cal. Oct. 4, 2016); accord e.Digital,
2016 U.S. Dist. LEXIS 111689, at *7-8; TeleSign Corp. v.
Twilio, Inc., No. 16-2106, 2016 U.S. Dist. LEXIS 123516,
at *4 (C.D. Cal. Aug. 3, 2016); Tannerite Sports, LLC v.
Jerent Enters., LLC, No. 15-180, 2016 U.S. Dist. LEXIS
57942, at *9 (D. Or. May 2, 2016).
notes that one court in this Circuit has held otherwise. Doc.
54, at 9 n.5 (citing Hologram USA, Inc. v. Pulse
Evolution Corp., No. 14-772, 2016 U.S. Dist.
5426 (D. Nev. Jan. 15, 2016)). Hologram relied on an
Advisory Committee Note statement that “[t]he
abrogation of Rule 84 does not alter existing pleading
standards or otherwise change the requirements of Civil Rule
8.” Id. at *7-8 n.1 (quoting Fed.R.Civ.P. 84
advisory committee's note to 2015 amendments).
Hologram assumed the phrase “existing pleading
standards” included Form 18, and therefore applied Form
18 even after its abrogation. See Hologram, 2016
U.S. Dist. LEXIS 5426, at *8 & n.1.
Court finds Hologram's rationale unpersuasive
for the same reason as Judge Tigar in e.Digital:
First, it is just as likely, if not more so, that the
Advisory Committee used the phrase “existing pleading
standards” simply to refer to Twombly and its
progeny, but not including the exception recognized by
K-Tech. Indeed, nothing in the Advisory Committee
note suggests that it was aware of the K-Tech
exception to Twombly. Second, K-Tech's
holding was premised on the fact that “to the extent
any conflict exists between Twombly (and its
progeny) and the Forms regarding pleading requirements, the
Forms control.” Absent Form 18 itself, there is simply
no support in the Federal Rules of Civil Procedure for a
different pleading standard for direct patent infringement
claims. As a result, the Court concludes that former Form 18
no longer controls and that ...