United States District Court, D. Arizona
G. Campbell United States District Judge
Ibiden U.S.A. Corp. and Ibiden Co. Ltd. (collectively,
"Ibiden") and Intel Corp. jointly move to dismiss
Plaintiff Continental Circuits LLC's second amended
complaint (Docs. 128 (sealed version), 133 (redacted
version)) under Federal Rule of Civil Procedure 12(b)(6).
Docs. 142 (redacted version), 147 (sealed
version). The motion has been fully briefed. Docs.
142, 155, 175. For the reasons that follow, Defendants'
motion to dismiss will be granted in part and denied in part.
second time, Defendants move to dismiss Plaintiffs complaint
on the basis of factual insufficiency. Because the Court
recounted the facts and procedural history of this case in
detail in its previous order granting Defendants' first
motion to dismiss in part (Doc. 112), only a brief review is
Ibiden produces package substrates ____. See Doc.
133, ¶¶ 51, 110, 154; Doc. 147, at 9. These substrates
are used in computer electronics, including computer
processors manufactured by Defendant Intel. See Doc.
133, ¶¶ 49-51. The two companies worked together to
develop the specifications that Intel expects Ibiden's
substrates to meet. Id., ¶¶ 52, 55-56.
circuit boards like those in Intel's products are made of
alternating layers of conductive and non-conductive
materials. See id., ¶29. When adhesion between
the layers is poor, they can separate. See Id. In
the 1990s, four employees of Continental Circuits, Inc., a
now-defunct circuit-board manufacturer, invented a
"novel surface roughening technique" using etching
to create a "non-uniformly roughened surface" that
allows for stronger adhesion between layers. Id.,
¶¶ 28-29, 120. The four co-inventors applied to
patent the surface-roughening technology in 1997, and two
patents were issued in 2000 and 2004, respectively. Doc. 52,
at 6; see also Doc. 133, ¶¶ 12-13. Those
patents are not at issue in this case. A continuation
application was filed by early 2005, and eventually resulted
in issuance of the four patents that are at issue in this
action: U.S. Patent Nos. 7, 501, 582 (2009), 8, 278, 560
(2012), 8, 581, 105 (2013), and 9, 374, 912 (2016)
(collectively, the "patents-in-suit"). See
Doc. 133, ¶¶ 14-17, 35-36.
Continental Circuits LLC is a non-operating entity that was
formed in 2016 and owns the patents-in-suit. Doc. 49, at 11
n.8; Doc. 133, ¶ 19. The day after the last of the
patents-in-suit was issued, Plaintiff initiated this action.
See Doc. 1. The original and first amended
complaints alleged that both Defendants infringed the
patents-in-suit directly, indirectly, and willfully. Doc. 95,
claims that a former employee of Continental Circuits
"shared the technology described in the patents-in-suit
with Ibiden" in 1997, as Ibiden's "supplier
relationship with Intel" was growing. Id.,
¶¶29-33. According to Plaintiff, Ibiden and Intel
"collaborate[d] ... to develop specifications for the
design of packaging to ultimately be used in Intel
products." Id., ¶45. As a result, certain
Intel product lines came to "meet or embody the
limitations of at least one claim" of each of the
patents-in-suit, as did "any Package Substrates
manufactured by Ibiden for Intel or others."
Id., ¶¶ 51-100, 103.
alleges that both Defendants learned of the pending
continuation application that eventually became the
patents-in-suit through a 2005 letter from a
"representative of Continental Circuits" to the
heads of their respective legal departments. See
id., ¶¶ 34-37. Plaintiff further asserts that
a "representative of Continental Circuits . . .
confirmed" in a 2014 conversation with an Ibiden manager
"that the technology claimed in the patents-in-suit is
still in use." Id., ¶ 41.
February 21, 2017, this Court granted in part and denied in
part motions to dismiss filed by Defendants. Doc. 112, at 20.
In the ensuing months, discovery has continued and Plaintiff
has amended its complaint a second time. Docs. 128, 133.
Defendants now jointly move to dismiss the second amended
complaint in part, arguing that Plaintiff "has still
failed to come forward with plausible allegations" to
support a number of its claims. Doc. 142, at 6.
Court will not grant a motion to dismiss under Rule 12(b)(6)
unless the complaint either lacks a cognizable legal theory
or fails to allege facts sufficient to support its theory.
Balistreri v. Paciflca Police Dep't, 901 F.2d
696, 699 (9th Cir. 1988). If a complaint sets forth a
cognizable legal theory, it 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) (quoting Bell Art. Corp. v.
Twombly, 550 U.S. 544, 570 (2007)). A claim is facially
plausible when the complaint's factual allegations
"allow the court to draw the reasonable inference that
I the defendant is liable for the misconduct alleged."
Id. "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. (quoting Twombly, 550
U.S. at 556).
previous order, the Court dismissed the first amended
complaint's direct infringement claims as to Intel's
Itanium series processors, chipsets, and wireless network
adapters after concluding that Plaintiff had not provided
enough facts to make them plausible. Doc. 112, at 10, 20.
Plaintiffs second amended complaint no longer advances claims
against Intel's wireless network adapters, and Defendants
are not seeking dismissal of the newly-pled direct
infringement claims against Intel's Itanium processors
and chipsets. Doc. 142, at 5 n.l.
move to dismiss Plaintiffs direct infringement claims against
Ibiden as to unnamed products sold to customers other than
Intel. The Court previously dismissed these claims, and will
do so again.
Direct Infringement Claims against Unidentified Ibiden
Section 271(a) Claims.
direct infringer under 35 U.S.C. § 271(a) "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."
In its previous order, the Court made clear that the
Twombly/Iqbal pleading standard, which requires
"enough facts to make [Plaintiffs claims] plausible,
" applies to direct infringement claims. Doc. 112, at 7,
10. Plaintiffs first amended complaint alleged infringement
by Ibiden products manufactured for unspecified companies
other than Intel. See, e.g., Doc. 95, ¶¶
103 (alleging infringement by "any Package Substrates
manufactured by Ibiden for Intel or others"), 147
(alleging Ibiden induced infringement by "Intel and
other companies supplied by Ibiden"). The Court
dismissed these claims because Plaintiff provided "no
facts about those unspecified products, and thus set forth
no plausible basis for infringement by them." Doc. 112,
second amended complaint, Plaintiff redefines these
unnamed products as ___ Doc. 128 ¶¶ 61, 104.
Rather than adding facts about the products themselves,
Plaintiff has added facts, learned in the course of
discovery, about _____ Doc. 128 ¶¶ 58-61.
argues that these additional facts satisfy the "purpose
of pleading standards" - to give Defendants "fair
notice" of the claims so they can "defend
[themselves] effectively." Doc. 175, at 6 (quoting
Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011)).
But Plaintiff candidly acknowledges that it has not
identified the allegedly infringing products or the specific
facts that show they infringe. See Doc. 170, at 6-8;
Doc. 175, at 6-8. Plaintiff attempts to excuse this
failure by asserting that Ibiden knows which
products ___ so Ibiden can identify the infringing
products. Plaintiff states: "While Continental Circuits
and the Court may not yet be able to identify those products,
Ibiden can." Doc. 175, at 8.
argument misunderstands modern pleading requirements. As the
Supreme Court explained: "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." Iqbal, 556 U.S. at 678 (emphasis
added). Plaintiff provides no facts that enable the Court to
draw the reasonable inference that Ibiden produces infringing
products for other customers. Indeed, it is apparent from the
second amended complaint that Plaintiff does not even know if
such products exist. Doc. 155, at 5 n.2. Plaintiff alleges
the mere possibility of such infringement, and "where
the well-pleaded facts do not permit the court to infer more
than the mere possibility of misconduct, the complaint has
alleged - but it has not 'show[n]' - 'that the
pleader is entitled to relief.'" Id. at 679
(alteration in original) (quoting Fed. R. Civ. P.
alleges that the unnamed products are ___ as the Intel
products identified in the second amended complaint,
but Plaintiff does not allege facts showing that ___ yields
products with the same allegedly-infringing features as the
named products. Absent such facts, Plaintiff is left in the
same position as before: the second amended complaint, like
the first, "contains no facts about those unspecified
products." Doc. 112, at 11. As Defendants point out,
"[t]here are no images of substrates of non-Intel
products, nor any allegations of common materials,
specifications, or parameters" between the named and
unnamed products. Doc. 155, at 5-6.
courts have, in the wake of Twombly and
Iqbal, required some level of specificity regarding
the accused productIndeed, many courts have even required an
exact identification." FootBalance Sys. Inc. v. Zero
Gravity Inside, Inc., No. 15-1058, 2016 WL 903681, at *4
(S.D. Cal. Feb. 8, 2016) (quoting Wistron Corp. v.
Phillip M. Adams & Assocs., LLC, No. 10-4458, 2011
WL 4079231, at *4 (N.D. Cal. Sept. 12, 2011) (rejecting
"generic descriptions" such as "computer
chips, motherboards, computers")). The general consensus
in this Circuit is that "the accused products must be
identified with 'at least minimal specificity.'"
Anza Tech., Inc. v. Novatel Wireless, Inc., No.
16-585, 2016 WL 7555397, at *3 ...