Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_04-cv-03319/USCOURTS-cand-5_04-cv-03319-1/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 15:1125 Trademark Infringement (Lanham Act)

---

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Case No. C 04-3319 JF

ORDER GRANTING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT

(JFEX2)

** E-filed on 6/21/05 **

NOT FOR CITATION

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

DOMINANT SEMICONDUCTORS SDN. BHD.,

 Plaintiff,

 v.

OSRAM GMBH, et al.,

 Defendants.

Case Number C 04-3319 JF

ORDER GRANTING DEFENDANTS’

MOTION FOR SUMMARY

JUDGMENT

[Docket No. 40]

Defendants OSRAM GmbH, OSRAM Opto Semiconductors GmbH, OSRAM Opto

Semiconductors, Inc., and OSRAM Sylvania, Inc. (collectively “OSRAM”) move for summary

judgment on all claims asserted by Plaintiff Dominant Semiconductors Sdn. Bhd. (“Dominant”). 

Dominant opposes the motion. The Court has read the moving and responding papers and has

considered the oral arguments of counsel presented on June 17, 2005. For the reasons set forth

below, the motion will be granted.

I. BACKGROUND

OSRAM and Dominant are competitors in the market for light-emitting diodes (“LEDs”),

which are small semiconductor devices that emit light. OSRAM, a subsidiary of Siemens, owns

a number of patents relating to LED technology. Dominant was founded in 2000 and currently is

Case 5:04-cv-03319-JF Document 72 Filed 06/21/05 Page 1 of 10
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

1

 Dominant also alleges that Infineon, another Siemens subsidiary, has threatened

companies that do business with Dominant. Infineon is not a party to this lawsuit, nor does

Dominant allege a basis upon which the actions of Infineon would be attributable to OSRAM.

2

Case No. C 04-3319 JF

ORDER GRANTING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT

(JFEX2)

managed by Tay Kheng Chiong, a former OSRAM production director. Dominant alleges that

OSRAM has engaged in a history of harassing behavior, including threats of legal action if

Dominant infringed any of OSRAM’s patents and the hiring of private investigators to monitor

activity at Dominant’s production facilities.1

In September 2003, OSRAM distributed a letter written by its outside patent counsel,

Epping Hermann Fisher, which expressed the following opinion (“Opinion Letter”):

It is our opinion that according to the present information all DOMINANT LED

products except colored SpiceLEDs make unauthorized use of at least one most of

them of at least two or more of [sic] OSRAM’s patent families directed to LED

housings and white light emitting LEDs. All white light emitting LEDs of

Dominant make use of at least three, most of them of even four [sic] respective

OSRAM patent families. In our opinion it can be assumed, that with the help of

the respective patents listed in the enclosed table in the most important countries

the import, use and sale of most DOMINANT LED products can be stopped.

Finally we want to emphasize that we do not mean to imply by silence herein that

there are not other OSRAM patents which are infringed by LED products

manufactured and offered by DOMINANT.

Sanders Decl., Ex. 1. This conclusion was accompanied by, among other things, a two-page

table listing (1) the types of Dominant products thought to infringe OSRAM’s patents, (2) certain

characteristics of those products based on Dominant’s “Catalogue Summary dated March 2003,”

(3) the OSRAM patents believed to be infringed by each product type, and (4) brief

“[o]bservations” of how each product type infringed the subject patents. See id. In addition,

addressing patents separate from OSRAM’s LED-related patents, the Opinion Letter stated,

“OSRAM’s chip technology patents have not been considered, yet. It can be assumed that

DOMINANT’s products make use of OSRAM’s chip technology patents.” Id. OSRAM sent the

Opinion Letter to its “Colleagues, Sales and Distribution Partners” along with a cover e-mail

message explaining that the recipients were receiving the “official statement of the OSRAM’s

patent counsel concerning ‘DOMINANT’ products.” Id. OSRAM invited the recipients of the

Case 5:04-cv-03319-JF Document 72 Filed 06/21/05 Page 2 of 10
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

2

 OSRAM suggested that its “Colleagues, Sales and Distribution Partners” could transmit

the following statement, in pertinent part, to their own customers:

Dear Customer

attached You’ll find the official statement of the OSRAM’s patent counsel

concerning potential infringement of several OSRAM patents with

“DOMINANT” products. We therefore have the possibility (if necessary with the

rulings of legal authorities)to [sic] stop the import, sale and use of the related

“DOMINANT” products in the most important countries. In consequencies [sic]

the final endproduct [sic] of your customers must be withdrawn from market.

Id.

3

 The ITC complaint alleges that six OSRAM patents are infringed by Dominant’s white

LEDs, two other patents are infringed by Dominant’s power LEDs and bi-color LEDs, and

another patent is infringed by Dominant’s power LEDs. See Sanders Decl., Ex. 4.

3

Case No. C 04-3319 JF

ORDER GRANTING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT

(JFEX2)

message to use the Opinion Letter and an additional statement provided by OSRAM2 “to explain

the legal situation to Your customer.” Id. 

In May 2004, OSRAM filed a complaint before the United States International Trade

Commission (“ITC”) alleging infringement of nine OSRAM patents by various Dominant LED

products.

3

 See Sanders Decl., Ex. 4. The ITC began its investigation of OSRAM’s claims in

June 2004. On June 8, 2004, OSRAM issued a press release announcing the filing of its ITC

complaint against Dominant and providing details about its allegations of patent infringement

and the relief sought. See Sanders Decl., Ex. 1. Then, on July 19, 2004, OSRAM issued a press

release announcing that it had received an American distributor’s declaration that it would not

“import or market any LEDs that infringe on OSRAM’s patent rights.” Id. OSRAM noted that

“[t]his declaration relates in particular to products supplied by the manufacturer Dominant

Semiconductors . . . against whom OSRAM . . . has filed a lawsuit with the ITC . . . for

infringement of patents.” Id. OSRAM subsequently amended its ITC complaint by alleging

infringement of a tenth patent by Dominant’s super-small LEDs and dropping claims of

infringement by Dominant’s bi-color LEDs. See Sanders Decl., Ex. 7. Dominant agreed not to

oppose the amendment provided that it would have to answer only the amended complaint and

not the original complaint. See Sanders Decl., Ex. 6. In its answer to the amended ITC

Case 5:04-cv-03319-JF Document 72 Filed 06/21/05 Page 3 of 10
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

4

 This concession was related to the tenth patent, which was added to the amended ITC

complaint.

5

 Dominant claimed at the ITC trial that its white LEDs since had been redesigned to

avoid infringement.

6

 The administrative law judge has made an initial determination, which is subject to

review by the ITC. According to the parties, the ITC will decide whether to review the initial

determination by June 24, 2005, and will render a final determination by August 10, 2005.

4

Case No. C 04-3319 JF

ORDER GRANTING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT

(JFEX2)

complaint, Dominant raised a patent misuse-defense based on the Opinion Letter and cover email message, which it later withdrew. Also in the ITC proceeding, Dominant moved for

summary judgment of non-infringement, but its motion was denied. See Sanders Decl., Ex. 10.

In August 2004, Dominant initiated the instant action against OSRAM, alleging unfair

competition under the Lanham Act, the California Business and Professions Code, and California

common law; intentional interference with contractual relations; interference with prospective

economic advantage; and trade libel. The ITC trial commenced in December 2004; Dominant

conceded both that its super-small LEDs infringed one of OSRAM’s patents4 and that its white

LEDs infringed five OSRAM patents at the time the ITC investigation began.5 See Sanders

Decl., Ex. 11. A final determination by the ITC is pending.6

II. LEGAL STANDARD

A motion for summary judgment should be granted if there is no genuine issue of

material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P.

56(c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986). Material facts are those

that might affect the outcome of the case under the governing law. Anderson, 477 U.S. at 248.

There is a genuine dispute about a material fact if there is sufficient evidence for a reasonable

jury to return a verdict for the nonmoving party. Id. The moving party bears the initial burden of

informing the Court of the basis for the motion and identifying portions of the pleadings,

depositions, answers to interrogatories, admissions, or affidavits that demonstrate the absence of

a triable issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Where the

party moving for summary judgment would not bear the ultimate burden of persuasion at trial, it

must either produce evidence negating an essential element of the nonmoving party’s claim or

Case 5:04-cv-03319-JF Document 72 Filed 06/21/05 Page 4 of 10
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

5

Case No. C 04-3319 JF

ORDER GRANTING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT

(JFEX2)

show that the nonmoving party does not have enough evidence of an essential element to carry its

ultimate burden of persuasion at trial. Nissan Fire & Marine Ins. Co. v. Fritz Cos., 210 F.3d

1099, 1102 (9th Cir. 2000).

If the moving party meets its initial burden, the burden shifts to the nonmoving party to

present specific facts showing that there is a genuine issue of material fact for trial. Fed. R. Civ.

P. 56(e); Celotex Corp., 477 U.S. at 324. The nonmoving party may not rely on the mere

allegations or denials in its pleading in order to preclude summary judgment. Fed. R. Civ. P.

56(e); Anderson, 477 U.S. at 248. The evidence and all reasonable inferences therefrom must be

viewed in the light most favorable to the nonmoving party. T.W. Elec. Serv., Inc. v. Pac. Elec.

Contractors Ass’n, 809 F.2d 626, 630-31 (9th Cir. 1987). Summary judgment thus is not

appropriate if the nonmoving party presents evidence from which a reasonable jury could resolve

the material issue in its favor. Anderson, 477 U.S. at 248-49; Barlow v. Ground, 943 F.2d 1132,

1134-36 (9th Cir. 1991). 

III. DISCUSSION

OSRAM moves for summary judgment of no liability as to Dominant’s claims for unfair

competition, which are based on allegations that OSRAM made numerous false and misleading

statements regarding Dominant’s infringement of OSRAM’s patents. When a claim arises out of

the assertion of patent rights, “federal patent law bars the imposition of liability [under federal or

state law] for publicizing a patent in the marketplace unless the plaintiff can show that the patent

holder acted in bad faith.” Zenith Elecs. Corp. v. Exzec, Inc., 182 F.3d 1340, 1353 (Fed. Cir.

1999); see also Globetrotter Software, Inc. v. Elan Computer Group, Inc., 362 F.3d 1367, 1374

(Fed. Cir. 2004) (“[F]ederal patent law preempts state-law tort liability for a patentholder’s good

faith conduct in communications asserting infringement of its patent and warning about potential

litigation.”). To avoid preemption, the alleged infringer must make a threshold showing that the

patentee acted in bad faith in asserting its patent rights, regardless of the individual elements

otherwise required to establish a given claim. See Globetrotter, 362 F.3d at 1374-75. 

The Court applies a two-step analysis to determine whether a patentee has acted in bad

faith. First, the alleged infringer must show that the patentee’s communications alleging

Case 5:04-cv-03319-JF Document 72 Filed 06/21/05 Page 5 of 10
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

7

 Dominant argues that there is a genuine issue of material fact as to whether OSRAM

actually relied on the Opinion Letter in making its infringement allegations. However, Dominant

has offered no evidence suggesting that OSRAM did not rely on the letter. Indeed, it is difficult

to imagine what evidence Dominant could offer for this proposition in light of the fact that

OSRAM attached the Opinion Letter to its e-mail message to substantiate its allegations of

potential infringement.

6

Case No. C 04-3319 JF

ORDER GRANTING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT

(JFEX2)

infringement were “objectively baseless” such that “‘no reasonable litigant could realistically

expect success on the merits.’” Globetrotter, 362 F.3d at 1376 (quoting Prof’l Real Estate

Investors, Inc. v. Columbia Pictures Indus. Inc., 508 U.S. 49, 60 (1993)). After the alleged

infringer makes a showing of objective baselessness, it then must establish subjective bad faith

on the part of the patentee. Id. at 1376 n.8. To survive summary judgment and to overcome the

initial presumption of good faith, Dominant “must present affirmative evidence sufficient for a

reasonable jury to conclude that [OSRAM] acted in bad faith, in light of the burden of clear and

convincing evidence that will adhere at trial.” Golan v. Pingel Enterprise, Inc., 310 F.3d 1360,

1371 (Fed. Cir. 2002).

Dominant’s arguments that OSRAM acted in bad faith primarily concern the reliability of

the findings presented in the Opinion Letter and the accompanying e-mail message from

OSRAM. First, Dominant argues that OSRAM refused to provide evidence substantiating the

Opinion Letter’s infringement analysis during the discovery stage of the ITC litigation, thus

creating a disputed issue of material fact as to whether the Opinion Letter actually was reliable. 

Next, Dominant contends that specific allegations in the Opinion Letter reveal their own

unreliability or could not have been supported by the information that was available to

OSRAM’s patent counsel at the time of the analysis. Finally, Dominant argues that the Opinion

Letter and e-mail message create a false impression that all of Dominant’s products infringe

OSRAM’s patents. The latter two arguments appear to go to the issue of whether OSRAM’s

patent counsel could have had or did have a reasonable belief in the conclusions he drew. 

However, the proper inquiry is whether OSRAM itself had a reasonable basis for communicating

its infringement allegations in reliance on the opinion of its patent counsel.7 On this point, Golan

v. Pingel Enterprise, Inc., is instructive.

Case 5:04-cv-03319-JF Document 72 Filed 06/21/05 Page 6 of 10
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

8

 Dominant argues that, in finding no bad faith on the part of the patentee, the Golan court

“relied upon the fact that the patentee . . . expended ‘considerable effort’ pointing out that the

opinion of counsel was credible.” Opp’n at 15. However, Dominant misstates the reasoning of

the Golan court. The court actually stated that the alleged infringer, not the patentee, had

expended considerable effort arguing that the attorney’s opinion must be credible but that such

effort was misdirected because the correctness of the opinion is not the proper focus of the

inquiry. See Golan, 310 F.3d at 1373.

7

Case No. C 04-3319 JF

ORDER GRANTING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT

(JFEX2)

In Golan, the patentee sought to enforce an expired patent, relying on an attorney’s

erroneous calculation of the patent’s expiration date. See Golan, 310 F.3d at 1372. Although the

patentee relied on irrefutably false information, the court found that the patentee was not acting

in bad faith, because the alleged infringer offered no evidence suggesting that the patentee’s

reliance on the false information was unreasonable or that the patentee had any reason to believe

that the information was false. See id. at 1373. The court held that the very fact of reliance upon

an attorney’s opinion was one factor that suggested that the patentee had acted good faith. See id. 

Rejecting the alleged infringer’s argument that the relied-upon opinion had to be proven credible,

the court observed that such a requirement improperly would shift the burden to the patentee to

prove that it acted in good faith.8 See id. 

Having reviewed the undisputed evidence, the Court concludes that OSRAM’s

allegations of patent infringement in its e-mail message and press releases, based on its patent

counsel’s conclusion that Dominant’s products potentially infringed, were not objectively

baseless and thus were not made in bad faith. See Globetrotter, 362 F.3d at 1375. It was

objectively reasonable for OSRAM to have relied on the legal opinion of its patent counsel where

there is no evidence that counsel’s analysis was unreasonable on its face or contained clearly

unsupportable conclusions. OSRAM cannot be said to have acted in bad faith in communicating

its infringement allegations where those allegations were based on the results of what appears to

have been a good faith investigation by OSRAM’s patent counsel of infringement by various

Dominant products. While Dominant argues that OSRAM was in possession of another report

concluding that “[i]t remains to be examined whether there are property right infringements” at

the time OSRAM made its infringement allegations, Wright Opp’n Decl., Ex. M, and that

OSRAM’s knowledge of this report establishes the objective baselessness of its infringement

Case 5:04-cv-03319-JF Document 72 Filed 06/21/05 Page 7 of 10
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

9

 This ruling applies to Dominant’s claims for unfair competition under the Lanham Act

and California statutory and common law.

10 Dominant argues, without elaborating, that “the elements of [its] state law and common

law [unfair competition] claims are different from the elements of a Lanham Act claim” and that

“many of the state law claims are broader in their prohibition of unfair business practices and

sweep within their scope behavior that may otherwise not be actionable under the Lanham Act.” 

Opp’n at 19-20.

8

Case No. C 04-3319 JF

ORDER GRANTING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT

(JFEX2)

allegations—or at least raises a genuine issue of material fact as to OSRAM’s bad faith—the

Court concludes that the mere existence of this report would be insufficient to support a jury

verdict in favor of Dominant. The report is dated May 21, 2002, more than a year before

OSRAM’s patent counsel conducted its own investigation and drew a tentative conclusion of

infringement. The Court also rejects Dominant’s arguments that the mere fact that OSRAM

dropped some of the claims in its amended ITC complaint or made infringement allegations

without bringing a lawsuit in court—as opposed to bringing claims of infringement before the

ITC—raises a genuine issue as to whether OSRAM acted in bad faith; to credit these arguments

essentially would be to subject patentees to potential liability any time they amend their

pleadings or choose a forum for asserting their patent rights other than a court, regardless of the

presence of evidence of good faith or the lack of “other” evidence of bad faith. Accordingly,

OSRAM’s motion for summary judgment of no liability as to Dominant’s claims for unfair

competition will be GRANTED.9

As to Dominant’s remaining state law claims for intentional interference with contractual

relations, interference with prospective economic advantage, and trade libel, as well as

Dominant’s assertion that its state law unfair competition claims should survive the instant

motion,10 the Court concludes that these claims also are preempted by federal patent law, as they,

too, arise out of OSRAM’s good-faith assertion of its patent rights. By their very nature,

Dominant’s claims for intentional interference with contractual relations and interference with

prospective economic advantage must be based on OSRAM’s statements to the public or to

particular third parties, and the only such statements alleged specifically in the complaint are

those relating to patent infringement. Similarly, the harm alleged in the common law unfair

Case 5:04-cv-03319-JF Document 72 Filed 06/21/05 Page 8 of 10
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

11 It is not the Court’s task to “examine the entire file for evidence establishing a genuine

issue of fact, where the evidence is not set forth in the opposing papers with adequate references

so that it could conveniently be found.” Carmen v. S.F. Unified Sch. Dist., 237 F.3d 1026, 1031

(9th Cir. 2001).

12 OSRAM also moved to stay discovery pending the Court’s ruling on its motion for

summary judgment, arguing that continued discovery would be wasteful if the case ultimately

was disposed of on summary judgment. Dominant opposed the motion. The motion to stay

discovery is rendered moot by this Order.

9

Case No. C 04-3319 JF

ORDER GRANTING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT

(JFEX2)

competition claim is “lost sales, loss of goodwill and harm to Dominant’s reputation,” Compl. ¶

53, which could have resulted only from OSRAM’s statements regarding Dominant’s potential

patent infringement. Moreover, the claim for trade libel is premised on OSRAM’s “false

statements,” and all of the “false and misleading statements” set forth in a separate section of the

complaint entitled “Osram’s Recent False and Misleading Statements” relate to OSRAM’s

infringement allegations against Dominant. See Compl. at 5-7, 10. All of the evidence cited by

Dominant purportedly to show a non-patent basis for the state law claims in fact relates either

directly or indirectly to the Opinion Letter and OSRAM’s infringement allegations against

Dominant,11 and Dominant may not rely on mere allegations in its complaint that OSRAM has

engaged in harassing behavior unrelated to the issue of patent infringement (and prior to the

distribution of the Opinion Letter), see Compl. ¶¶ 16, 17, in order to preclude summary

judgment. Accordingly, OSRAM’s motion for summary judgment of no liability also will be

GRANTED as to Dominant’s state law claims for intentional interference with contractual

relations, interference with prospective economic advantage, and trade libel.

IV. ORDER

Good cause therefore appearing, IT IS HEREBY ORDERED that OSRAM’s motion for

summary judgment of no liability is GRANTED as to all claims.12

DATED: June 21, 2005

/s/ electronic signature authorized 

JEREMY FOGEL

United States District Judge

Case 5:04-cv-03319-JF Document 72 Filed 06/21/05 Page 9 of 10
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

10

Case No. C 04-3319 JF

ORDER GRANTING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT

(JFEX2)

This Order has been served upon the following persons:

Evelyn G. Heilbrunn heilbrunn@fr.com, herring@fr.com 

David James Miclean miclean@fr.com, arceo@fr.com 

Shawn D. Parrish sdp@mjllp.com 

Charles H. Sanders sanders@fr.com

Joanna V. Stromberg jstromberg@mjllp.com, rwright@wrightgunter.com 

Rocky N. Unruh Unruh@mjllp.com

Celine Jimenez Crowson 

Hogan & Hartson LLP

555 Thirteenth Street

Washington, DC 20004

Raymond Kurz 

Hogan & Hartson LLP

555 Thirteenth Street, NW

Washington, DC 20004

Anna Kurian Shaw 

Hogan & Hartson LLP

555 Thirteenth Street, N.W.

Washington, DC 20004

Jonathan M. Sobel 

Hogan & Hartson LLP

555 Thirteenth Street, NW

Washington, DC 20004

Teresa Summers 

Hogan & Hartson LLP

555 Thirteenth Street NW

Washington, DC 20004

Robert L. Wright 

Wright Berry & Odom LLP

612 Eighth Avenue

Fort Worth, TX 76104

Case 5:04-cv-03319-JF Document 72 Filed 06/21/05 Page 10 of 10