Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_15-cv-01277/USCOURTS-cand-5_15-cv-01277-6/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 28:2201 Declaratory Judgement

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United States District Court

Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

LAM RESEARCH CORPORATION,

Plaintiff,

v.

DANIEL L. FLAMM, et al.,

Defendants.

Case No. 15-cv-01277-BLF 

ORDER SUA SPONTE SEVERING 

DEFENDANT AND THIRD-PARTY 

PLAINTIFF DANIEL L. FLAMM’S 

CLAIMS AGAINST THIRD-PARTY 

DEFENDANTS

This declaratory judgment action seeking non-infringement of U.S. Patent Nos. 5,711,849,

6,017,221, and RE 40,264 started as an action between a seller of tools used to manufacture 

semiconductors and a patent owner. It has since grown to include third-party claims against four 

of the manufacturer’s customers, and generated two amended complaints, two answers, one 

amended third-party complaints, four answers to the amended third-party complaint, each with 

counterclaims, and four answers to the counterclaims. In light of the complexity of this case, 

severing the claims against the manufacturer’s customers will serve the ends of justice and further 

the prompt and efficient disposition of this litigation. Accordingly, for the reasons stated at the 

case management conference on March 24, 2016 and herein, the Court SEVERS Third-Party 

Plaintiff Dr. Flamm’s claims against each of the Third-Party Defendants.

I. BACKGROUND

Dr. Daniel Flamm is the owner and inventor of U.S. Patent Nos. 5,711,849, 6,017,221, and 

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RE 40,264, which claim methods used in manufacturing semiconductors. Exhs. A-C to SAC, ECF 

52-4-52-6. Lam Research Corporation designs, manufactures, and sells semiconductor processing 

tools that are used to fabricate semiconductors. SAC ¶ 2, ECF 52-8; Ans. to SAC ¶ 2, ECF 66.

Around September 2014, Dr. Flamm’s attorneys sent letters to some of Lam’s 

customers accusing them of infringing the patents-in-suit. SAC ¶¶ 29-30, Ans. to SAC ¶¶ 29-

30. Lam, alleging that it may be required to indemnify its customers, SAC ¶ 47, filed this action 

seeking declaratory judgment of non-infringement by itself and its customers of the patents-insuit. Dr. Flamm responded by filing a Third-Party Complaint against Lam’s customers 

GLOBALFOUNDRIES U.S. Inc., Intel Corporation, Maxim Integrated Products, Inc., and Micron 

Technology, Inc (collectively, “Third-Party Defendants”). Third-Party Complaint, ECF 50-4. Dr. 

Flamm also filed a complaint in the Western District of Texas against Lam’s customer Samsung 

Electronics, Co., Ltd. Case No. 1:15-cv-00613 (W.D. Tx.) at ECF 1. Each of the Third-Party 

Defendants has filed an answer and counterclaim to the Amended Third-Party Complaint seeking 

a declaration of non-infringement and invalidity. ECF 72, 74, 79, and 84. Dr. Flamm answered 

each of the counterclaims. ECF 93-96. 

In the midst of the foregoing, in August 2015, Lam filed five petitions for inter partes 

review directed to all claims of the ’221 and ’264 patents. The PTAB has instituted IPR on two 

petitions that are directed at some of the claims of the ’264 patent and instituted IPR on one 

petition that is directed to five of the seven challenged claims of the ’221 patent. In January 2016, 

Lam filed four additional IPR petitions that are directed towards the ’849 and ’264 patents. 

Meanwhile, Dr. Flamm filed a motion to stay this action pending the resolution of the 

Dr. Flamm’s lawsuit in the Western District of Texas. ECF 51. Lam opposes the stay, Third 

Party Defendants GLOBALFOUNDRIES and Maxim do not oppose a stay, Micron does not 

oppose a stay but believes the Western District of Texas action should be stayed pending the IPR 

proceedings, and Intel does not oppose a stay of the entire case but opposes any partial stay. ECF 

73, 76, 77, 88. Dr. Flamm also filed a motion to dismiss all but one claim of Lam’s Second 

Amended Complaint for lack of subject matter jurisdiction. ECF 64.

Finally, in the Western District of Texas, Samsung filed a motion to transfer that action to 

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this Court. Case No. 1:15-cv-00613 (W.D. Tx.) at ECF 37. Dr. Flamm opposes the motion. Id. at 

ECF 38, 41. That motion is pending.

The parties in this action appeared before the Court on March 24, 2016 for a hearing on 

Dr. Flamm’s motion to stay and for an initial case management conference. ECF 112, 113. The 

Court will issue a separate order on Dr. Flamm’s motion to stay.

II. DISCUSSION

Fed. R. Civ. P. 21 provides that “[o]n motion or on its own, the court may at any time, on 

just terms, add or drop a party. The court may also sever any claim against a party.” Severed 

claims and parties become independent actions that have separate judgments. Khanna v. State Bar 

of Cal., Case No. 07-cv-2587-EMC, 2007 WL 2288116, at *2 (N.D. Cal. Aug. 7, 2007). The 

Court has broad discretion to sever issues and may do so sua sponte. Id.; see also 7 Charles Alan 

Wright & Arthur R. Miller, Federal Practice and Procedure § 1689 (3d ed. 2015). In determining 

whether severance is appropriate, the Court considers factors such as whether there is a 

complexity of legal theories and factual proof, whether the jury may be confused by the existence 

of claims, cross-claims, and third party claims in the same trial, and whether severance will “serve 

the ends of justice and further the prompt and efficient disposition of litigation.” Khanna, 2007 

WL 2288116, at *2 (quoting CVI/Beta Ventures v. Custom Optical Frames, 896 F. Supp. 505, 505 

(D. Md. 1995)); see also 4-21 Moore’s Fed. Prac. Civ. § 21.05 (“The trial court thus has great 

discretion to restructure an action to promote the efficient administration of justice.”).

Here, the joinder of Third-Party Defendants GLOBALFOUNDRIES, Intel, Maxim, and 

Micron will not promote judicial efficiency and will instead, create significant case manageability 

issues. Each Third-Party Defendant could raise different factual and legal defenses of noninfringement and invalidity creating logistical headaches. Moreover, each Third-Party Defendant 

could file different motions, including dispositive motions, each raising unique factual and legal 

issues that will have to be analyzed separately. See, e.g. Hard Drive Productions, Inc. v. Does 1-

1-188, 809 F. Supp. 2d 1150, 1164 (N.D. Cal. 2011). The Court would face “scores of mini-trials 

involving different evidence and testimony.” Id. The Court’s concerns have already come to 

fruition as the Dr. Flamm’s motion to stay has generated five different filings, advocating four 

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different positions. See ECF 51, 73, 76, 77, 88. 

Furthermore, there would be significant issues with discovery and at trial. As Dr. Flamm 

recognizes in his motion to stay, the Third-Party Defendants are competitors “who fiercely

safeguard their manufacturing processes from one another and the world.” Mot. to Stay at 5-6, 

ECF 51. “[I]f this action proceeds with all of them...they will be required to divulge their trade 

secrets to one another in discovery and trial.” Id. at 6. Allowing this case to proceed in such a 

manner would violate the “principles of fundamental fairness” and prejudice the Third-Party 

Defendants. Coleman v. Quaker Oats Co., 232 F.3d 1271, 1296 (9th Cir. 2000). While, as Dr. 

Flamm also recognizes, the Court could reduce the risk that trade secrets would be disclosed to 

competitors through protective orders and bifurcating this matter for separate trials, Mot. to Stay at 

6, ECF 51, the Court finds severance would eliminate the risk of disclosing trade secrets while 

allowing this matter to go forward in an orderly fashion.

Accordingly, it is more efficient to have a separate case for each Third-Party Defendant 

with separate motion hearings and discovery proceedings. Given these considerations, the Court 

finds that all of the claims against the Third-Party Defendants shall be severed from this 

proceeding. 

IV. ORDER

For the foregoing reasons, IT IS HEREBY ORDERED that:

1. Third-Party Plaintiff Dr. Flamm’s claims against each of the Third-Party Defendants are 

SEVERED but remain pending in this Court. The clerk of the court SHALL assign to a 

new case number for each of the following actions:

a. Dr. Flamm’s claims against GLOBALFOUNDRIES U.S. Inc.

b. Dr. Flamm’s claims against Intel Corporation.

c. Dr. Flamm’s claims against Maxim Integrated Products, Inc.

d. Dr. Flamm’s claims against Micron Technology, Inc.

The Court finds that Third-Party Plaintiff Dr. Flamm’s claims against each Third-Party 

Defendant are related to this action. Therefore, the new case numbers shall end in “BLF.” 

2. Dr. Flamm is shall pay the filing fee for each action against GLOBALFOUNDRIES, Intel,

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Maxim, and Micron.

3. Dr. Flamm is ORDERED to file new complaints in the severed cases by April 22, 2016. 

4. The claims between Lam and Dr. Flamm remain pending in this case.

IT IS SO ORDERED.

Dated: March 30, 2016

 ______________________________________

BETH LABSON FREEMAN

United States District Judge

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