Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_06-cv-04496/USCOURTS-cand-5_06-cv-04496-3/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 35:145 Patent Infringement

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Case No. C 06-4496 JF (RS)

ORDER GRANTING MOSAID’S MOTION TO DISMISS FOR LACK OF SUBJECT MATTER JURISDICTION

(JFLC2)

**E-Filed 10/23/06**

NOT FOR CITATION

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

MICRON TECHNOLOGY, INC.,

 Plaintiff,

 v.

MOSAID TECHNOLOGIES, INC.,

 Defendant.

Case Number C 06-4496 JF (RS)

ORDER GRANTING MOSAID’S

MOTION TO DISMISS FOR LACK

OF SUBJECT MATTER

JURISDICTION

[re doc. no. 4]

Defendant Mosaid Technologies, Inc. (“Mosaid”) moves to dismiss the declaratory relief

action of Plaintiff Micron Technology, Inc. (“Micron”) for lack of subject matter jurisdiction or,

alternatively, to transfer the action to the Eastern District of Texas. The Court has considered the

briefing submitted by the parties as well as the oral arguments presented at the hearing on

October 20, 2006. For the reasons discussed below, the Court will dismiss the instant action for

lack of subject matter jurisdiction.

I. BACKGROUND

Mosaid is in the business of acquiring patents in order to obtain revenue by licensing such

patents or litigating alleged infringement of such patents. Mosaid owns several patents in the

area of dynamic random access memory (“DRAM”). The four largest manufacturers of DRAM

Case 5:06-cv-04496-JF Document 35 Filed 10/23/06 Page 1 of 5
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Case No. C 06-4496 JF (RS)

ORDER GRANTING MOSAID’S MOTION TO DISMISS FOR LACK OF SUBJECT MATTER JURISDICTION

(JFLC2)

products are Samsung Electronics Company, Ltd. (“Samsung”), Hynix Semiconductor, Inc.

(“Hynix”), Infineon Technologies North America Corporation (“Infineon”) and Micron,

accounting for more than 75% of worldwide DRAM sales. 

Between 2001 and 2005, Mosaid filed and litigated patent infringement actions against

Samsung, Hynix and Infineon. Mosaid reached settlement Samsung and Hynix in 2005, and with

Infineon in 2006. As part of the Infineon settlement, the parties stipulated to vacatur of the claim

construction and summary judgment rulings, which were unfavorable to Mosaid at least in part. 

The parties to the Infineon action filed a joint motion to vacate on July 24, 2006, which motion is

pending before this Court in a related action, Infineon Technologies North America Corp. v.

Mosaid Technologies, Inc., C 02-5772 JF (RS).

On the same date the Infineon parties filed the joint motion to vacate, Micron filed the

instant declaratory judgment action against Mosaid and moved to intervene or in the alternative

to appear as amicus curiae in the Infineon action in order to oppose the motion to vacate. The

following day, on July 25, 2006, Mosaid filed a patent infringement suit against Micron in the

Eastern District of Texas. Mosaid also named as defendants two relatively small DRAM

manufacturers, ProMOS Technologies Inc. (“ProMOS”) and Powership Semiconductor

Corporation (“Powership”).

II. DISCUSSION

Under the Declaratory Judgment Act, a declaratory relief action may be brought to

resolve an “actual controversy.” 28 U.S.C. § 2201. “The purpose of the Act is to enable a person

who is reasonably at legal risk because of an unresolved dispute, to obtain judicial resolution of

that dispute without having to await the commencement of legal action by the other side.” BP

Chemicals Ltd. v. Union Carbide Corp., 4 F.3d 975, 977 (Fed. Cir. 1993). The Federal Circuit

has developed a two-part test for determining whether jurisdiction exists under the Act: there

must be both (1) an explicit threat or other action by the patentee, which creates a reasonable

apprehension on the part of the declaratory plaintiff that it will face an infringement suit, and (2)

present activity which could constitute infringement or concrete steps taken with the intent to

conduct such activity.” Id. at 978. The test is applied to the facts existing when the declaratory

Case 5:06-cv-04496-JF Document 35 Filed 10/23/06 Page 2 of 5
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Case No. C 06-4496 JF (RS)

ORDER GRANTING MOSAID’S MOTION TO DISMISS FOR LACK OF SUBJECT MATTER JURISDICTION

(JFLC2)

relief complaint is filed. Arrowhead Industrial Water, Inc. v. Ecolochem, Inc., 846 F.2d 731, 736

(Fed. Cir. 1988). 

Only the first prong is at issue here. In determining whether a patent holder’s conduct is

sufficient to create a reasonable apprehension of suit, the Court must consider the totality of the

circumstances. Id. “If the circumstances warrant, a reasonable apprehension may be found in the

absence of any communication from the defendant to the plaintiff.” Id. However, if the

defendant “has done nothing but obtain a patent,” there is no basis for the reasonable

apprehension required by the test. Id.

While the Court initially was inclined to view Mosaid’s history of litigating against other

DRAM manufacturers together with Mosaid’s public statements sufficient to meet the first

prong, the Court concludes that Mosaid’s conduct was not sufficient to give rise to a reasonable

apprehension of litigation against Micron. The undisputed evidence in the record demonstrates

that during the last four years, Mosaid has not made any direct threats or accusations of patent

infringement to Micron; has not made any such threats or accusations to third parties (for

example, Micron’s customers); and has not made any public comments regarding infringement

by Micron. Micron argues that Mosaid’s suits against other DRAM manufacturers and public

statements regarding its commitment to protect its patent rights nonetheless are sufficient to meet

the first prong of the test. After reviewing all of the authorities cited by the parties, and

conducting its own research, the Court has been unable to discover any case in which a

company’s prosecution of its patent rights, combined with general statements to the market, were

held sufficient to give rise to jurisdiction under the Declaratory Relief Act.

Even if the Court were to find that Micron had established subject matter jurisdiction, the

Court would exercise its discretion to decline jurisdiction in this case. See Wilton v. Seven Falls

Co., 515 U.S. 277, 282, (1995) (federal courts have “discretion in determining whether and when

to entertain an action under the Declaratory Judgment Act, even when the suit otherwise satisfies

subject matter jurisdictional prerequisites”). Factors to be considered in a court’s decision

whether to exercise subject matter jurisdiction include the judicial goals of avoiding needless

determination of state law issues; discouraging litigants from filing declaratory actions as a

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Case No. C 06-4496 JF (RS)

ORDER GRANTING MOSAID’S MOTION TO DISMISS FOR LACK OF SUBJECT MATTER JURISDICTION

(JFLC2)

means of forum shopping; avoiding duplicative litigation. Huth v. Hartford Ins. Co. of the

Midwest, 298 F.3d 800, 803 (9th Cir. 2002). 

As noted above, Mosaid has filed a patent infringement action against Micron and other

defendants in the Eastern District of Texas. Because Micron filed the instant declaratory relief

action before Mosaid filed the Texas action, the Court ordinarily would give Micron’s choice of

forum great weight under the first to file rule. However, the existence of subject matter

jurisdiction over Micron’s declaratory relief action is tenuous at best given the absence of any

direct or indirect threats of litigation by Mosaid. The question of Micron’s infringement may be

fully litigated in Texas. Because it includes parties not named in the instant action, the Texas

action is broader than the instant declaratory relief action. Because the cases were filed only one

day apart, this Court is not any more invested in the issues than is the Texas Court. Under these

circumstances, for reasons of judicial economy and to avoid duplicate litigation, the Court

concludes that the Eastern District of Texas provides the better forum for litigation of the claims

between Micron and Mosaid.

Because the Court concludes that it lacks subject matter jurisdiction, and that it would

decline to exercise such jurisdiction even if it existed, the Court need not reach Mosaid’s

alternative motion to transfer the instant action to the Eastern District of Texas. 

III. ORDER

Defendant’s motion to dismiss for lack of subject matter jurisdiction is GRANTED.

DATED: 10/23/06

__________________________________

JEREMY FOGEL

United States District Judge

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Case No. C 06-4496 JF (RS)

ORDER GRANTING MOSAID’S MOTION TO DISMISS FOR LACK OF SUBJECT MATTER JURISDICTION

(JFLC2)

This Order was served on the following persons:

Lorrel A. Birnschein birnscheinl@howrey.com, fabianj@howrey.com

Henry C. Bunsow bunsowh@howrey.com, lim@howrey.com

Korula T. Cherian cheriank@howrey.com, perezl@howrey.com

Sean DeBruine sdebruine@akingump.com, skapralov@akingump.com;

nmarie@akingump.com; btseng@akingump.com; vchan@akingump.com

Jonathan M. James jjames@perkinscoie.com, dgraziano@perkinscoie.com,

docketphx@perkinscoie.com

Stefani E. Shanberg sshanberg@perkinscoie.com, eeberline@perkinscoie.com

Robert Scott Wales WalesS@howrey.com, PearsonS@howrey.com

Kenneth B. Wilson kwilson@perkinscoie.com, eeberline@perkinscoie.com;

sshanberg@perkinscoie.com; wriggs@perkinscoie.com; lbailey@perkinscoie.com;

dhellmoldt@perkinscoie.com; mrubin@perkinscoie.com

David M. LaSpaluto

Perkins Coie Brown & Bain P.A.

2901 North Central Avenue

P.O. Box 400

Phoenix, AZ 85001-0400

Christopher M. Schultz

Perkins Coie Brown & Bain P.A.

2901 North Central Avenue

P.O. Box 400

Phoenix, AZ 85001-0400

Case 5:06-cv-04496-JF Document 35 Filed 10/23/06 Page 5 of 5