Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_06-cv-06613/USCOURTS-cand-4_06-cv-06613-3/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 28:1338 Patent Infringement

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United States District Court

For the Northern District of California

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

FUJITSU LIMITED, a Japanese

corporation, and FUJITSU

MICROELECTRONICS AMERICA, INC., a

California corporation,

Plaintiffs,

v.

NANYA TECHNOLOGY CORP., a Taiwanese

corporation, and NANYA TECHNOLOGY

CORP., U.S.A., a California

corporation,

Defendants.

 /

AND RELATED COUNTERCLAIMS.

 /

No. C 06-6613 CW

ORDER GRANTING IN

PART MOTION TO

STRIKE PLAINTIFFS'

COUNTERCLAIMS AND

DENYING MOTION TO

STRIKE PLAINTIFFS'

FIRST SUPPLEMENTAL

PATENT LOCAL

RULE 3-1 DISCLOSURE

Defendants Nanya Technology Corp. and Nanya Technology Corp.

U.S.A. (collectively, Nanya) move to strike the counterclaims filed

by Plaintiffs Fujitsu Limited and Fujitsu Microelectronics America,

Inc. (collectively, Fujitsu). In a separate motion, Nanya moves to 

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For the Northern District of California

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Prior to the case management conference, the Court heard

argument on Nanya's motion to dismiss, transfer or stay. In its

February 9, 2007 order, the Court denied without prejudice Nanya's

motion. The Court concluded that the case Nanya filed against

Fujitsu in Guam was the first-filed case and, therefore, this Court

would defer to the Guam district court to decide the appropriate

forum and whether the first-filed rule is applicable. The Court is

still awaiting the Guam district court's ruling on Fujitsu's motion

to transfer the case in Guam to the Northern District of

California. If that motion is denied, this case will be

transferred to Guam. Nonetheless, in the interest of efficiency,

the Court rules on the within motions.

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strike Fujitsu's First Supplemental Patent Local Rule 3-1

Disclosure. Fujitsu opposes the motions. The matter is decided on

the papers. Having considered all of the papers filed by the

parties, the Court grants in part Nanya's motion to strike

Fujitsu's counterclaims and denies Nanya's motion to strike

Fujitsu's First Supplemental Patent Local Rule 3-1 Disclosure. 

BACKGROUND

At the case management conference on February 2, 2007, the

Court asked whether Nanya or Fujitsu would be adding any additional

claims or parties to the lawsuit.1 Counsel for Fujitsu responded

that "as of now, we don't have any. . . ." Counsel for Nanya

indicated that it would be asserting additional counterclaims and

additional declaratory claims along with its answer. The Court

informed Nanya that it could file its counterclaims with its

answer, but other than that, February 2, 2007, was the deadline for

adding additional parties and claims. The scheduling order

provides that, with the exception of any counterclaim filed with

the answer, the deadline to add additional parties or claims was

February 2, 2007.

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On February 21, 2007, Nanya filed its Answer, Affirmative

Defenses and Counterclaims. Count Thirteen was entitled,

"Non-Infringement, Invalidity, and Unenforceability of U.S. Patent

No. 5,227,996." Although Fujitsu had previously accused Nanya of

infringing its '996 patent, Fujitsu had not alleged that Nanya

infringed the '996 patent in its complaint in this action, nor did

it include any assertions of the '996 patent in its Patent Local

Rule 3-1 Disclosure of Asserted Claims and Preliminary Contentions. 

On March 16, 2007, Fujitsu filed its Reply, Affirmative

Defenses and Counterclaims. It contained six counterclaims. The

first counterclaim alleged that Nanya infringed its '996 patent. 

The remaining counterclaims alleged breach of contract, breach of

confidentiality, fraud, negligent misrepresentation and unfair

competition under California law. On April 4, 2007, Fujitsu filed

its First Supplemental Patent Local Rule 3-1 Disclosure of Asserted

Claims and Preliminary Infringement Contentions, which asserts that

Nanya infringes claims 1, 2, 3, 4, 5 and 13 of the '996 patent. 

Fujitsu did not seek leave of the Court to file its six new claims

or to file its supplemental patent infringement disclosure.

DISCUSSION

Nanya argues that Fujitsu's counterclaims and supplemental

disclosure were filed without leave of the Court in violation of

the Court's scheduling order, the Federal Rules of Civil Procedure

and the Local Patent Rules and, thus, should be stricken because

they constitute immaterial and impertinent matter. Pursuant to

Federal Rule of Civil Procedure 12(f), the Court may strike from a

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pleading "any insufficient defense or any redundant, immaterial,

impertinent or scandalous matter." See also Fed. R. Civ. P. 15(a)

("a party may amend the party's pleading only by leave of court or

by written consent of the adverse party"); Patent L.R. 3-7

(explaining that, except in situations not applicable here,

amendment or modification of preliminary infringement contentions

"may be made only by order of the Court, which shall be entered

only upon a showing of good cause").

Fujitsu responds that its counterclaims are compulsory in

response to Nanya's counterclaims and thus should not be stricken. 

It argues that it was not required to seek leave to file these

counterclaims or to supplement its preliminary infringement

contentions. 

The Ninth Circuit has noted that counterclaims in reply may be

used in situations where the counterclaims are compulsory. Frank

Briscoe Co., Inc. v. Dynatex Corp., 857 F.2d 606, 610 (9th Cir.

1988). Nanya does not dispute that Fujitsu's counterclaims in

reply are responsive to its counterclaims, nor does it argue that

the counterclaims in reply are not compulsory. Nanya points out

that Fujitsu was aware of the facts on which its counterclaims in

reply are predicated before Nanya filed its counterclaims and that

Fujitsu could have brought, in its original complaint, the claims

it now seeks to bring, but chose not to do so. This, however, does

not provide cause to strike Fujitsu's counterclaims in reply.

Nonetheless, counterclaims in reply are treated "as an

amendment to the complaint." Electroglas, Inc. v. Dynatex Corp.,

473 F. Supp. 1167, 1171 (N.D. Cal. 1979). To simplify the

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Nanya's request for judicial notice (Docket No. 88) is

GRANTED.

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pleadings, the Court directs Fujitsu to amend its complaint to add

its six counterclaims in reply as causes of actions in its

complaint. 

Pursuant to the Local Patent Rules, Fujitsu should have sought

leave to file its supplemental patent infringement contentions. 

Nonetheless, in the interest of judicial efficiency, and because

good cause does exist, the Court will not force Fujitsu to seek

leave to file its supplemental patent infringement contentions, nor

will the Court strike the supplemental contentions. So as not to

prejudice Nanya, the Court will allow Nanya an additional twentytwo days to file its response to Fujitsu's supplemental patent

infringement contentions. If Nanya has already filed its response,

it may file an amended response twenty-two days from the date of

this order. 

CONCLUSION

For the foregoing reasons, Nanya's motion to strike Fujitsu's

counterclaims (Docket No. 87) is GRANTED IN PART.2 The Court

strikes Fujitsu's counterclaims, but it grants Fujitsu leave to

amend its complaint to add the causes of action it sought to bring

in its counterclaims in reply. Fujitsu must file its amended

complaint within five days from the date of this order. Nanya may

then file an answer, or it may rest on its prior answer and claims. 

Nanya's motion to strike Fujitsu's First Supplemental Patent Local

Rule 3-1 Disclosures (Docket No. 92) is DENIED. Nanya's request

for attorneys' fees and costs incurred in bringing its motions, is

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also DENIED. 

IT IS SO ORDERED.

Dated: 6/6/07 

CLAUDIA WILKEN

United States District Judge

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