Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_13-cv-03345/USCOURTS-cand-5_13-cv-03345-13/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 35:271 Patent Infringement

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

FINISAR CORPORATION,

Plaintiff,

v.

NISTICA, INC.,

Defendant.

Case No. 13-cv-03345-BLF 

ORDER GRANTING DEFENDANT’S

MOTION FOR LEAVE TO AMEND; 

GRANTING IN PART PLAINTIFF’S 

MOTION TO DISMISS/STRIKE

[Re: ECF 142, 152]

On March 19, 2015, the Court heard argument on defendant Nistica, Inc.’s Motion for 

Leave to File Third Amended Answer and Counterclaims, ECF 152, and plaintiff Finisar

Corporation’s Motion to Dismiss and Strike counterclaims and affirmative defenses in 

Defendant’s Second Amended Answer, ECF 142. 

For the reasons stated on the record, Defendant’s motion for leave to amend is 

GRANTED. Defendant shall file the proposed Third Amended Answer and Counterclaims into 

the record by no later than March 25, 2015.

Because Plaintiff acknowledges that it had ample opportunity to address the deficiencies in 

the proposed Third Amended Answer in the parties’ briefing on the present motions, the Court 

shall apply Plaintiff’s arguments in its motion to dismiss and strike to Defendant’s Third Amended 

Answer. For the reasons stated on the record, Plaintiff’s motion to dismiss and strike is 

GRANTED IN PART and DENIED IN PART as follows:

1. Plaintiff’s motion is GRANTED with respect to the counterclaims and affirmative 

defenses in the Second Amended Answer (“SAA”) that Defendant did not renew in the Third 

Amended Answer (“TAA”). These include: the SAA 13th and 14th counterclaims for breach of 

contract and the affirmative defenses of patent exhaustion (SAA 19th), mitigation of damages 

Case 5:13-cv-03345-BLF Document 167 Filed 03/20/15 Page 1 of 2
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United States District Court

Northern District of California

(SAA 23rd), justified conduct (SAA 24th), failure to state a claim (SAA 25th), and unjust 

enrichment (SAA 26th). These counterclaims are dismissed, and the affirmative defenses stricken, 

with prejudice. 

2. Plaintiff’s motion is GRANTED IN PART and DENIED IN PART with respect to 

the affirmative defenses of license/implied license (TAA 18th), estoppel (TAA 19th), and 

release/waiver/covenant not to sue (TAA 20th). The Court finds implausible the theory that the 

2009 Settlement Agreement between Plaintiff and Defendant contemplated releasing claims based 

upon patents that the parties did not own at the time of the agreement. As such, the portions of 

these affirmative defenses that depend on a purported release of claims pertaining to the ’687, 

’833, and ’740 Patents—which Plaintiff acquired from CiDRA Corporate Services years after the 

entry of the Settlement Agreement—are STRICKEN. Plaintiff’s motion is DENIED IN PART

because the Court finds that Defendant may plausibly assert that the 2009 Settlement Agreement 

released claims with respect to the ’599 and ’980 Patents, to the extent that Defendant’s MEMS 

devices are accused of infringing those patents. Moreover, Defendant may assert equitable 

defenses based upon Plaintiff’s succession of interest to the ’687, ’833, and ’740 Patents that are 

not dependent on any release found in the 2009 Settlement Agreement.

3. Plaintiff’s motion is accordingly DENIED with respect to the affirmative defenses 

of unclean hands (TAA 21st), laches (TAA 22nd), and equitable estoppel (TAA 23rd). 

Because the Court has ordered that a portion of Defendant’s affirmative defenses be 

stricken, Defendant shall have leave to file a Fourth Amended Answer that conforms to this order. 

The parties are ordered to meet and confer concerning this conformed pleading. To the extent the 

parties can reach a stipulation, the Fourth Amended Answer shall be filed by no later than April 

3, 2015. To the extent the parties cannot so stipulate, the Third Amended Answer, as modified by 

this order, shall be the operative pleading.

IT IS SO ORDERED.

Dated: March 20, 2015

______________________________________

BETH LABSON FREEMAN

United States District Judge

Case 5:13-cv-03345-BLF Document 167 Filed 03/20/15 Page 2 of 2