Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_07-cv-02346/USCOURTS-cand-5_07-cv-02346-0/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

For the Northern District of California

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*E-FILED 10/29/07*

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

AQUA-LUNG AMERICA, INC., 

Plaintiff,

 v.

AMERICAN UNDERWATER PRODUCTS, INC.,

et al,

Defendants . /

NO. C 07-2346 RS

ORDER DENYING MOTION TO

DISMISS COUNTERCLAIMS

I. INTRODUCTION

Plaintiff Aqua-Lung America Inc. moves to dismiss the third and fourth claims for relief

asserted in the counterclaim of defendant Two-Forty Deuce Corporation. Pursuant to Civil Local

Rule 7-1 (b), the Court finds this matter suitable for disposition without oral argument. For the

reasons set forth below, the motion is denied.

 II. BACKGROUND

Plaintiff Aqua-Lung brought this action for declaratory relief seeking a declaration of noninfringement and invalidity of certain patents held by Two-Forty Deuce Corporation and licensed to

defendant American Underwater Products. Shane Taylor is apparently the principal of Two-Forty

Deuce, and the original owner of the patents-in-suit. Aqua-Lung contends that PTO records show

Case 5:07-cv-02346-RS Document 33 Filed 10/29/07 Page 1 of 4
United States District Court

For the Northern District of California

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1

 Aqua-Lung does not support this assertion, made in its reply brief, with any citation to

evidence.

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assignment of one of the patents in suit from Taylor to Two-Forty, but not the others.1

Two-Forty counterclaims for infringement and for misappropriation of trade secrets and

fraud. Two-Forty contends that Taylor approached Aqua-Lung to discuss a valve technology he

was developing and seeking to patent, apparently in the hope of entering into a business arrangement

with Aqua-Lung. Instead, Aqua-Lung allegedly used the confidential information it gained to

develop its own, infringing, technology

The present motion to dismiss is grounded on Aqua-Lung’s arguments that: (1) the counts of

the counterclaim brought under state law for misappropriation of trade secrets and fraud are not

closely enough connected to the patent claims to support supplemental jurisdiction, and (2) the

counterclaim fails to allege expressly any assignment from Taylor to Two-Forty of the rights

involved.

Aqua-Lung contends that as a result, those counts of the counterclaim are subject to

dismissal under Rule 12(b)(1) of the Rules of Civil Procedure (lack of subject matter jurisdiction),

Rule 12(b)(6) (failure to state a claim), and/or Rule 12(b)(7) (failure to join a necessary party–i.e.,

Shane Taylor). Although neither the notice of the motion nor its caption refers to Rule 56, AquaLung also makes a passing request that its motion be treated as one for summary judgment, in the

alternative.

III. DISCUSSION

Aqua-Lung’s assertion that Two-Forty’s misappropriation and fraud counterclaims are so

disconnected from its patent claims as to preclude supplemental jurisdiction is made without

meaningful analysis or citation to authority. From the cursory briefing, and review of the

counterclaim, it appears that those claims do arise from the same nucleus of operative facts such that

exercising supplemental jurisdiction over them is appropriate. See 28 U.S.C. § 1367 (“[T]he district

courts shall have supplemental jurisdiction over all other claims that are so related to claims in the

action within such original jurisdiction that they form part of the same case or controversy under

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United States District Court

For the Northern District of California

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2

 Aqua-Lung correctly notes that the fraud claim is subject to the heightened particularity

pleading requirements of Rule 9. Aqua-Lung, has not challenged the adequacy of the pleading as to

the alleged misrepresentations; it only questions whether the right to bring the claim rests in TwoForty as opposed to Taylor. That issue is outside the Scope of Rule 9. See Rule 9(b) (requiring only

that, “the circumstances constituting fraud or mistake shall be stated with particularity.”)

ORDER DENYING MOTION TO DISMISS

C 07-2346 RS

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Article III of the United States Constitution.”) Aqua-Lung may be correct that resolution of the state

law claims will not require the Court to “determine substantial issues of patent law,” but that is not

the test for supplemental jurisdiction. Aqua-Lung has failed to show that the state law claims are not

“part of the same case or controversy,” which is all that Two-Forty is required to advance.

Aqua-Lung’s contention that the counterclaim does not adequately plead an “assignment”

from Taylor to Two-Forty is similarly unavailing. The Counterclaim identifies Taylor as TwoForty’s “predecessor in interest,” thereby putting Aqua-Lung on notice of the basis for the claims. 

See Fed. R. Civ. Pro 8.2

Finally, Aqua-Lung’s three-sentence reference in the body of its brief to summary judgment

is insufficient to shift the burden to Two-Forty to produce evidence in support of its claims. 

Accordingly, the motion is denied.

IV. CONCLUSION

 Aqua-Lung’s motion to dismiss is denied.

IT IS SO ORDERED.

Dated: October 29, 2007 

RICHARD SEEBORG

United States Magistrate Judge

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United States District Court

For the Northern District of California

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ORDER DENYING MOTION TO DISMISS

C 07-2346 RS

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THIS IS TO CERTIFY THAT NOTICE OF THIS ORDER HAS BEEN GIVEN TO:

Karen Boyd karen@kiboyd.com

A. James Isbester jamie@iandalaw.com, donna@itpatentcounsel.com

Joel A Kauth joel.kauth@kppb.com

Douglas V. Rigler drigler@young-thompson.com

Gillian Winifred Thackray gillian@itpatentcounsel.com

Counsel are responsible for distributing copies of this document to co-counsel who have not

registered for e-filing under the Court's CM/ECF program. 

Dated: 10/29/07 Chambers of Judge Richard Seeborg

By: /s/ BAK 

Case 5:07-cv-02346-RS Document 33 Filed 10/29/07 Page 4 of 4