Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_05-cv-01411/USCOURTS-caed-1_05-cv-01411-50/pdf.json

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

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IN THE UNITED STATES DISTRICT COURT FOR THE

EASTERN DISTRICT OF CALIFORNIA

DUHN OIL TOOL, INC., )

)

)

)

Plaintiff, )

)

vs. )

)

)

COOPER CAMERON CORPORATION, )

)

)

Defendant. )

)

)

No. CV-F-05-1411 OWW/GSA

MEMORANDUM DECISION AND

ORDER GRANTING PLAINTIFF'S

MOTION FOR LEAVE TO FILE

SECOND AMENDED COMPLAINT

(Doc. 377) 

Before the Court is Plaintiff Duhn Oil Tool, Inc.’s (“Duhn”)

motion for leave to file a Second Amended Complaint (SAC) to

assert claims against Defendant Cooper Cameron Corporation

(“Cameron”) of infringement by manufacture and use, and indirect

infringement. The proposed SAC alleges:

III. FACTUAL BACKGROUND.

...

6. Defendant, by itself or in concert with

others, manufactured, used, offered for sale,

sold, is manufacturing, using, offering for

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sale and/or is selling in this district and

elsewhere in the United States, products

which infringe the ‘925 Patent, literally

and/or pursuant to the Doctrine of

Equivalents, and/or by otherwise contributing

to the infringement or inducing others to

infringe the ‘925 Patent.

7. When Plaintiff initiated this action

against Defendant on or about November 5,

2005, Defendant was manufacturing, selling,

renting, and/or offering to sell and/or rent

an infringing product referred to as its ‘Old

Style’ design. Plaintiff’s and Defendant’s

infringement and non-infringement experts,

respectively, have both confirmed in

discovery that this ‘Old Style’ design

infringes the ‘925 Patent as it meets all the

claim limitations of the ‘925 Patent. 

Defendant has provided manuals and training

to third parties for knowingly inducing them

to infringe the ‘925 Patent. Further,

Defendant’s mandrel systems have no

substantial non-infringing use. Accordingly,

Defendant has been contributing to

infringement or inducing others to infringe

the ‘925 Patent, in particular its customers

and certain third party installer companies,

regarding the ‘Old Style’ design.

8. Defendant continuously made, used, sold,

and offered for sale the ‘Old Style’ design,

and/or contributed to or induced others to

infringe, until about August 2007, when

Defendant attempted to work around

infringement by introducing a ‘New Style’

design. In the ‘New Style’ design, Defendant

merely widened the groove of the frac mandrel

where the lock screws set. Despite this

insignificant change, the ‘New Style’ retains

all the same infringing structures as

Defendant’s ‘Old Style,’ including lockscrews

that could be tightened to engage the surface

of the frac mandrel.

9. In November 2007, Defendant re-introduced

its ‘Original’ design in a second attempt to

avoid infringement. Defendant’s ‘Original’

design preceded its infringing ‘Old Style’

design. The ‘Original’ design is identical

to Defendant’s ‘Old Style’ and ‘New Style’

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designs, except there is no groove on the

frac mandrel where the lockscrews set. The

lockscrews for the ‘Original’ design,

however, still set into the outer surface of

the frac mandrel, as confirmed during

discovery.

10. Both Plaintiff’s own infringement expert

and Defendant’s witnesses confirmed during

discovery that Defendant’s ‘New Style’ and

‘Original’ designs (collectively ‘new

designs’) infringe the ‘925 Patent. For

instance, Plaintiff’s expert maintains that

Defendant’s new designs contain all the

structures claimed by the ‘925 Patent,

including the ‘wherein’ clause limitation. 

Similarly, Defendant’s own senior principal

engineer testified at a deposition in May 29,

2008 that the lockscrews on these new designs

indented the frac mandrel when they were

torqued into the frac mandrel and will react

a sheer force. He further testified that the

lockscrews of the new designs were tightened

during fracing to act like set screws to

prevent the frac mandrel from rotating and

dancing.

11. Since the introduction of Defendant’s

new designs in August 2007, Defendant has

significantly misrepresented that its new

designs do not infringe the ‘925 Patent. 

Defendant has falsely asserted that the

lockscrews of these new designs do not engage

the frac mandrel and that the new designs are

not capable of meeting the claim limitations

of the ‘925 Patent. To the contrary,

Defendant has been fully aware that the

lockscrews on these new designs are torquedin during fracing and that the new designs

are capable of meeting the ‘wherein’ clause

of the ‘925 Patent. Defendant, for example,

sent a reminder bulletin to its employees a

year after introduction of its new designs,

in or about August 21, 2008. In this

reminder bulletin, Defendant expressly

acknowledges that its installers continued to

torque the lockscrews into the new design

frac mandrels, thereby infringing the ‘925

Patent.

12. Despite knowing that its New Style and

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Original designs continued to infringe the

‘925 Patent, Defendant continues to make,

sell, rent, use, and offer to sell/rent its

infringing new designs literally and/or

pursuant to the Doctrine of Equivalents,

and/or by otherwise contributing to

infringement or inducing others to infringe

the ‘925 Patent. Even after the introduction

of the New Designs, Defendant’s ‘Old Style’

continues to infringe the ‘925 Patent due to

Defendant’s continuing to contribute to or

induce others to infringe the ‘925 Patent.

13. Defendant knew or should have known that

its New Style and Original designs were

installed in an infringing configuration. On

or about September 24, 2008 and November 6,

2008, Plaintiff inspected several of

Defendant’s ‘New Style’ and ‘Original’

designs at Defendant’s storage facilities in

Grand Junction, Colorado and Longview, Texas. 

These inspections revealed blatant

indentations and deformations caused by

lockscrews still being tightened against the

frac mandrels of Defendant’s new designs. 

Defendant knew, or it was clearly obvious to

Defendant, that its new designs continued to

infringe the ‘925 Patent.

14. Defendant’s continued manufacture, sale,

rental, use, and/or offer to sell/rent its

infringing ‘New Style’ and ‘Original’

designs, either directly or by otherwise

contributing to infringement or inducing

others to infringe the ‘925 Patent is

deliberate and reckless, and a complete

disregard of Plaintiff’s patent rights.

IV. PATENT INFRINGEMENT.

15. By its aforesaid acts, Defendant has

violated and continues to violate 35 U.S.C. §

271 by its infringement of the ‘925 Patent by

making, using, selling, and/or offering to

sell products or devices that embody or

otherwise practice one or more of the claims

of the ‘925 Patent, literally and/or pursuant

to the Doctrine of Equivalents, and/or by

otherwise contributing to infringement or

inducing others to infringe the ‘925 Patent. 

The infringing products or devices include

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the ‘Old Style,’ ‘New Style,’ and ‘Original

Design’ frac mandrels.

16. The acts of infringement of Defendant

will continue unless enjoined by this Court.

17. Plaintiff is being damaged by

Defendant’s infringement of the ‘925 Patent

and is being and will continue to be

irreparably damaged unless Defendant’s

infringement is enjoined by this Court. 

Plaintiff does not have an adequate remedy at

law.

18. As a result of Defendant’s infringement

of the ‘925 Patent, Plaintiff has been

damaged, and its business and property rights

will continue to be damaged, and is entitled

to recover damages for such injuries pursuant

to 35 U.S.C. § 284 in an amount to be

determined at trial.

19. Defendant’s acts of infringement

regarding Defendant’s New Style and Original

designs are deliberate and willful, thereby

rendering this an exceptional case pursuant

to 35 U.S.C. §§ 284 and 285.

V. PRAYER FOR RELIEF

WHEREFORE, Plaintiff demands judgment against

Defendant as follows:

1. That this Court adjudge and declare:

a. That it has jurisdiction over 

the parties and of the subject matter of this

action;

b. That United States Patent No.

6,920,925 is valid and owned by Plaintiff;

c. That Defendant has committed 

acts of patent infringement by its

manufacture, use, sale, rental, and offers to

sell/rent products that infringe the ‘925

Patent; and

d. That Defendant’s acts of 

infringement since August 2007 has been

willful;

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2. That Defendant, its agents,

representatives, employees, assigns and

suppliers, and all persons acting in concert

or in privity with any of them be

preliminarily and permanently enjoined from

making, using, offering for sale or rental,

selling, renting, or importing the inventions

of the ‘925 Patent.

3. That Defendant be required by mandatory

injunction to deliver to Plaintiff for

destruction any and all products in

Defendant’s possession, custody, or control

embodying the patented invention as well as

any promotional literature therefor;

4. That Plaintiff be awarded damages caused

by the acts of patent infringement of the

Defendant in an amount sufficient to

compensate Plaintiff for the infringement;

5. That Plaintiff be awarded enhanced

damages since August 2007 in connection with

Defendant’s activities regarding the New

Style and Original Design mandrels, in

accordance with 35 U.S.C. § 284 and in view

of Defendant’s willful infringement; 

6. That Plaintiff be awarded prejudgment

interest on infringement damages;

7. That Plaintiff have and recover its costs

in this action, including its attorneys’

fees; and

8. That Plaintiff have such other and

further relief as the court may deem just and

proper. 

A. Background.

By Memorandum Decision and Order filed on March 4, 2009,

Duhn’s motion for leave to file a First Amended Complaint (“FAC”)

to assert a claim against Cameron for willful infringement of

Duhn’s ‘925 Patent and enhanced damages regarding Cameron’s “New

Style” and “Original” design frac mandrels was granted. Duhn

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filed the FAC on March 12, 2009. 

On March 31, 2009, Cameron filed a motion to strike the FAC. 

Cameron’s motion to strike the FAC was denied by the June 9

Memorandum Decision. Cameron raised three grounds in support of

the motion to strike:

Plaintiff Duhn Oil filed its First Amended

Complaint which amends the Complaint to add a

new claim for alleged willful infringement

and enhanced damages under 35 U.S.C. § 284,

but the amendment regarding alleged willful

infringement is not limited to Cameron’s New

Style and Original design frac mandrels. In

addition, the First Amended Complaint adds a

substantial new claim seeking an exceptional

case finding and attorneys fees under 35

U.S.C. § 285, for which this Court did not

grant leave to amend. Furthermore, the First

Amended Complaint adds new allegations of

infringement based on ‘manufacture’ and ‘use’

as the means by which Defendant Cameron

allegedly infringes the assert [sic] patent,

which are statutory classes of infringement

distinctly different from the ‘selling’ or

‘offering to sell’ allegations in the

original Complaint. 

The June 9 Memorandum Decision denied Cameron’s motion to

strike Duhn’s claim for alleged willful infringement and enhanced

damages under 35 U.S.C. § 284 to the extent Cameron argued that 

the amendment regarding alleged willful infringement is not

limited to Cameron’s New Style and Original design frac mandrels.

Cameron acknowledged that the FAC specifically limited Duhn’s

assertion of willful infringement to the New Style and Original

design frac mandrels, but argued that the demand for judgment 

that “Defendant’s acts of infringement since August 2007 have

been willful,” could be read to seek a judgment of willful

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infringement for Cameron’s installation of customer-owned Old

Style frac mandrels since 2007. In denying this aspect of the

motion to strike, the Court relied on the allegations of the FAC

and Duhn’s representations that the claim for willful

infringement and enhanced damages are limited to the New Style

and Original design frac mandrels. The June 9 Memorandum

Decision ruled:

In its reply brief, Cameron accepts Duhn’s

restrictive reading of the prayer in the FAC

but nonetheless requests: 

[T]hat this Court bind Duhn Oil to

this understanding of the amended

Complaint. to [sic] the extent

that Duhn Oil may later attempt to

shift its position (as it has

cycled through at least five

various inconsistent

interpretations of the disputed

‘wherein’ clause in its asserted

patent claims), and attempt to seek

enhanced damages for Cameron’s Old

Style design, including Cameron’s

post-August 2007 management and

installation of customer owned Old

Style frac mandrels, Cameron

respectfully requests that this

Court enforce the doctrine of

judicial estoppel to prohibit any

such attempted shift in position.

Cameron’s motion to strike on this ground is

DENIED. The FAC clearly alleges willful

infringement only in connection with the New

Style and Original design frac mandrels from

the specified dates. Cameron’s concern that

Duhn might change its position is speculative

and can be addressed when and if the issue

ever comes up. The Pretrial Order will

supersede that FAC and Cameron may preserve

its legal position by assuring that the

issues of fact and law and limited to the

stated time periods for each device.

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(June 9 Memorandum Decision, 6:4-22).

The June 9 Memorandum Decision denied Cameron’s motion to

strike to the extent that Cameron argued that the FAC adds a

claim seeking an exceptional case finding and attorneys’ fees

under 35 U.S.C. § 285:

Although the exceptional case finding and

award of attorney’s fees under Section 285

are not mandatory, they become available in

connection with a claim of willful patent

infringement. Cameron’s concern that the

possibility of increased attorney’s fees

applying to the claim of willful infringement

for post-2007 activities is a matter that can

be addressed if and when it becomes necessary

to do so. Duhn has for at least a year

asserted that Cameron’s infringement is

willful. This is no surprise. The remedies

incident to a claim of willful infringement

are fairly in play. They are never

mandatory. 

The June 9 Memorandum Decision then denied Cameron’s motion

to strike the allegations in the FAC based on “manufacture” and

“use:”

Cameron asserts that the FAC adds new

allegations of patent infringement based on

‘manufacture’ and ‘use’ without obtaining

leave of court. The Complaint alleged:

6. On information and belief,

Defendant, by itself or in concert

with others, has offered for sale,

sold, is offering for sale and/or

is selling ... products which

infringe the ‘925 Patent.

7. By its aforesaid acts,

Defendant has violated 35 U.S.C. §

271 by its infringement of the ‘925

Patent.

Cameron argues that the FAC’s addition of the

distinct statutory classes of ‘making’ and

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‘using’ dramatically alters the infringement

pleadings over three years into this case.

Duhn responds that the Complaint pled

manufacture and use as a basis of

infringement because the Complaint asserted

that Cameron had violated Section 271. 

Section 271(a) provides:

Except as otherwise provided in

this title, whoever without

authority makes, uses, offers to

sell, or sells any patented

invention ... infringes the patent.

Duhn asserts that the pleading of Section 271

in the Complaint ‘sufficiently and properly

included all the infringing acts outlined in

the statute, including “manufacture” and

“use,” into the infringement claim.’ Duhn

contends that ‘by broadly asserting patent

infringement under 35 U.S.C. § 271 in its

original complaint, Duhn has already provided

notice to Cameron, from the outset of the

case, that any of its conduct outlined in the

patent statute violates the ‘925 Patent,

including “manufacture” and “use.”’ Duhn

argues that Section 271 does not delineate

statutory classes of infringement ‘because

either or any of the listed conduct

implicates the same liability under the

statute.’ Duhn contends:

The infringement charge does not

change merely because Duhn now

expressly sets out “manufacture”

and “use” as Cameron’s additional

infringing acts in its amended

complaint. Cameron knew the basis

for Duhn’s patent infringement

charge under 35 U.S.C. § 271 and

cannot claim ignorance of that

charge.

The Complaint alleged that Cameron ‘has

offered for sale, sold, is offering for sale

and/or is selling ... products which infringe

the ‘925 Patent’ and that ‘[b]y its aforesaid

acts, Defendant has violated 35 U.S.C. § 271

by its infringement of the ‘925 Patent.

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Duhn further argues that the allegations in

the FAC concerning Cameron’s manufacture and

use constitute permitted supplemental facts

pursuant to the March 4 Memorandum Decision. 

Duhn refers to its opening brief in support

of the motion to amend in which Duhn, in

addition to seeking leave to add an

allegation of willful infringement for the

time period starting August 2007, ‘also seeks

leave to amend its complaint to seek enhanced

damages, and to supplement the Complaint with

further post-filing facts and occurrences.’ 

Duhn contends that, because the Court granted

its motion to amend, the Court granted

permission to Duhn to supplement the

Complaint regarding Cameron’s continued

infringement.

Duhn’s motion sought this relief concerning

use and manufacture in the conclusion of its

motion; it was not discussed in the body of

the brief. Nonetheless, the motion to amend

was granted.

Finally, Duhn argues that the allegations of

manufacture and use have a direct bearing on

Duhn’s patent infringement claim and do not

prejudice Cameron:

... Duhn’s allegations of

“manufacture” and “use” are central

to its patent infringement claim as

they expressly identify Cameron’s

specific infringing acts that were

confirmed during discovery. 

Extensive discovery has revealed

that Cameron continues to

manufacture, sell, rent, and

install its infringing frac

mandrels, despite notice of their

infringement. Even Cameron

concedes that these allegations are

highly relevant to Duhn’s charge as

it fails to submit any contrary

arguments in its moving papers.

... Cameron makes no showing in its

moving papers that it is prejudiced

by Duhn’s allegations of

“manufacture” and “use.” 

Presumably, Cameron does not suffer

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any harm as Duhn’s original

complaint and the extensive

discovery already conducted by both

parties in this case has provided

substantial notice to Cameron how

its devices and conduct infringe

the ‘925 Patent ... Cameron cannot

plead ignorance after three years

of extensive discovery and motion

practice by now claiming it does

not know that manufacturing and

using an infringing device

infringes the ‘925 Patent.

Cameron replies that the Court should ‘not

allow Duhn Oil to use this Court’s

authorization of amendments to the pleadings

regarding new assertions of alleged willful

infringement as a camel’s nose under the tent

for Duhn Oil to dramatically alter the

infringement pleadings over three years into

this case to add the distinct statutory

classes of “making” and “using” as the means

by which Defendant Cameron allegedly

infringes the asserted patent.’ 

The motion to strike on this ground is

DENIED. The subject of manufacture has been

fully disclosed since Cameron introduced its

New Style mandrel. Cameron asserts no

prejudice to it by the inclusion of

manufacturing and use to the FAC.

On July 8, 2009, Cameron filed a motion for clarification or

reconsideration of the Court’s Memorandum Decision denying

Cameron’s motion to strike the FAC. (Doc. 310). Cameron argued

that the June 9 Memorandum Decision did not permit Duhn to amend

its complaint to allege infringement for making or using the Old

Style frac mandrel, contending that Duhn’s motion for leave to

amend was limited to addressing issues related to Cameron’s New

Style and Original design frac mandrels that had been discovered

after the filing of the Complaint. At the December 8, 2009 

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hearing on Cameron’s motion, the Court ruled from the bench:

THE COURT: [¶] So it seems to me that what we

have is we have a complaint that says nothing

about manufacture or use and a complaint that

was amended to pick up activities after the

date in 2007 of the original and the new

style, but not the, in quotes, old style. 

And so as the Court understands this, there

is neither a willful infringement nor is

there a damage claim for manufacture and use

of the old style product in either of these

complaints. 

And so that that extent, it seems to me that

that is a clarification that should be made

so we’re all in the same page.

So that’s my tentative decision. Now,

anybody who wishes to be heard may do so.

MR. ROGERS: Yes, Your Honor. I think that

clarification is a good thing. That’s what

we were seeking. And with one caveat. You

said no damage claim for - and I hope that

you’re also referring to liability as well. 

No liability claim. No liability -

THE COURT: For manufacture or use.

MR. ROGERS: Yes.

THE COURT: There is no claim.

MR. ROGERS: Respecting manufacture and use of

the old style.

MR. ROGERS: Yes, Your Honor. That’s the

relief we’re requesting in our motion.

...

MR. WHITELAW: Thank you, Your Honor. I think

we need to take a couple of steps back here

to see where the parties started, where the

parties have been litigating this case, where

the parties have conducted discovery. 

Plaintiffs’ motion to strike and what the

scope of that motion was and where they made

the very same arguments they’re making now. 

But again, this is a case with infringement

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on the old style during the pendency of this

action changes were made to the old style. 

And that’s brought about the willful

infringement claims that we later sought for

the manual, which was the basis for their

motion to strike.

THE COURT: I said manufacture and use. 

That’s all that alleged as to the old style

in either of the complaints.

MR. WHITELAW: Well, Your Honor, if you go

back to the original complaint, there are

allegations regarding infringement under 35

USC Section 271, which includes manufacture

and use. And again, this was brought out in

the opposition to the motion to strike. And

the Court ruled and acknowledged that

manufacture and use was covered by that

section. [¶] Additionally, in the prayer of

that original complaint, there’s reference to

remedies in connection with the express

action of manufacturing and use on page three

of the complaint. And I believe it’s

paragraph two on page three. Defendant, its

agents, representatives, employees, assigns

and suppliers and all persons acting in

concert, et cetera, be permanently enjoined

from making, using, offering for sale,

selling or importing the invention of the

‘925. These arguments, they very same

identical arguments were argued in the motion

to strike. In our -

THE COURT: Yes. And we said that we would be

essentially, as we got closer to trial and

have a pretrial statement, we would be

parsing what the claims are. And this isn’t

inconsistent with that. This is to prevent,

if you establish infringement, patent

infringement of the ‘925 patent, any making,

use, offering for sale, selling or importing

the inventions of the ‘925 patent. And so

this doesn’t say what they are. This doesn’t

say what they have been. And depending upon

what the proof is at trial, we will see. [¶] 

And so what this does is this - a prayer

normally is not part of - it’s not an

operative part of the pleading that is a

complaint. However, for the purposes of

talking about what remedies are sought, that

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is a remedy in futural that would

essentially, if you get a judgment finding

patent infringement, that would prevent any

infringement by any statutory means. Knowing

what the statutory means and using express

language of means and not saying any and all

other ways or attempting to expand it, it

seems to me that that is, at least by

inference, a limitation because, of course,

you knew how to say it when you wanted to for

activities that would be included within the

purview of the statute. And so that, quite

frankly, is the way I see it. That’s the way

you pled it. And in terms of - I don’t know

what the volume is of old style products. I

don’t know what the use of those has been. I

don’t know what has been done with them,

where they are. And, you know, you all know

that. And if that’s fairly in play, then

we’re going to face that in doing a pretrial,

final pretrial conference order. And that’s

going to state what the factual and legal

issues in the case are. And if you show me

that essentially that’s what the discovery

has covered, that’s what everybody knows

about, that’s what damages projections and

the expert calculation of damages have

addressed and the experts on both sides have

done that, then, quite frankly, it’s the

equivalent of a rule 15 amendment to conform

to proof if that’s the basis on which the

lawsuit has been tried. But right now, as to

what is in the pleadings, this is what is in

the pleadings.

MR. WHITELAW: Well, Your Honor, considering

the substantial extent of old style’s

presence in the case by way of discovery, by

way of expert reports, all in the financial

expert reports deal with old style, by way of

all the depositions in the case. And, quite

frankly, Duhn filed a brief, a motion for

summary judgment of infringement on the old

style.

THE COURT: Right.

MR. WHITELAW: Not at any point did they argue

that old style was out of the case. The

parties -

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THE COURT: It’s not out of the case. There

is a - there is an allegation of selling,

offering for sale and renting. That’s in the

case. But making and using has not been

alleged. And so it that’s an amendment to

conform to proof, that’s something different. 

That’s what I’m saying.

MR. WHITELAW: Well, and again, Your Honor,

this is a complete surprise to Duhn. We

weren’t expecting to see arguments about the

very nature of the claims as they pertain to

the old style. Again, this motion for

reconsideration and the motion to strike

dealt with willful infringement of the new

claims. But I will note for the record in

their motion for summary judgment, in its Ps

& As, the motion for summary judgment deals

with, and I quote, manufacture, offer for

sale and sale and/or its inducement of others

to use the TSW alleged infringing device. So

we’ve always been dealing with manufacture

and use. We feel it was covered by the

general pleading in the statute, which was

alleged in the original complaint, and it was

further brought out and exemplified in the

amended complaint, which has now brought

about this clarification motion. But the

parties have always recognized, have always

acted, knowing that manufacture and use has

always been a claim by Duhn. Manufacture and

use come into the case by way of our damages,

by way of their conduct and specifically with

respect to renting and installing these

infringing devices. So they are - those

facts are in the case. [¶] Now, if Your Honor

is not convinced that there’s a sufficient

pleading in the complaints, then I would

request that Duhn be given the opportunity to

brief this issue, to bring a rule 15 motion

to amend to that it’s clear that

manufacturing and use are and should be as

they have been treated in this case as part

of our damage claim.

THE COURT: Well, that is certainly your

prerogative. I have simply read the

pleadings as they are in the context of how

this motion is presented.

MR. WHITELAW: And the motion that you’re

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talking about is their motion -

THE COURT: For clarification. The motion for

clarification.

MR. WHITELAW: Okay. Again, but the

clarification, again, this is what’s

confusing to Duhn, Your Honor. This motion

for clarification follows a motion, an order

on a motion to strike that deals with willful

infringement claims -

THE COURT: Yes.

MR. WHITELAW: - on the new style original

design. Nothing to do with the old style.

THE COURT: Well, that’s what I thought as

well. There’s no question about that. And

that’s how I ruled on that.

MR. WHITELAW: Well, the additional

allegations that refer to the old style

claims was, again, part three of the Court’s

order going back to the rule 15 order, which

granted us leave to amend in the first place. 

That order allowed us to put supplemental

facts in there. And these facts that are not

being played by counsel dealt with the

manufacture and use -

THE COURT: Well, here’s where I am, Mr.

Whitelaw and here’s my concern. I don’t want

to face this argument at trial or post trial. 

On a motion for judgment as a matter of law

and/or a new trial motion. I want to know

every device and every purported infringing

activity with regard to that device for which

damages are being sought. And I don’t think

that ought to be a secret. That isn’t what’s

alleged in this complaint. This complaint

alleges strictly sale, sold and offering for

sale. And/or is selling. That’s what the

defendant is alleged to have done. What you

asked for by way of injunctive relief that

you want to cover every potential activity of

infringement under the statute doesn’t mean

that it’s - that it’s in play or that it has

occurred. In other words, once you have a

protectable patent right, then you can get as

broad a relief as the statute will justify. 

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So I think we’re talking about apples and

oranges here. But the one thing I don’t want

to do is I don’t want to start picking that

jury and have the two of you, the two sides

fighting about what is and is not an issue in

the case and what infringement damages are

being sought for and what willful

infringement damages are being sought for. 

That’s what pertains to the original and the

new style, the willful infringement damages

claim. Not the old style. [¶] And so the

old style was being sold, offering to sell or

renting. If you say there’s more, then you

need to amend the complaint. And we do need

to determine that both parties have relied

upon and have discovered the case and have

litigated the case based on those being

issues. 

B. Governing Standards.1

Rule 15(a), Federal Rules of Civil Procedure, provides that

“leave [to amend] shall be freely given when justice so

requires.” “The purpose of pleading is ‘to facilitate a proper

decision on the merits’ ... and not erect formal and burdensome

impediments to the litigation process. Unless undue prejudice to

the opposing party will result, a trial judge should ordinarily

permit a party to amend its complaint.” Howey v. United States,

481 F.2d 1187, 1990 (1973). However, “[t]his strong policy

toward permitting the amendment of pleadings ... must be tempered

The parties address this motion solely by reference to the 1

standards governing a motion to amend under Rule 15, Federal Rules

of Civil Procedure. There is a pretrial scheduling order, which

normally means that resolution of this motion is governed by the

“good cause” requirement of Rule 16, Federal Rules of Civil

Procedure. However, by Minute Order filed on January 13, 2010, the

pretrial conference and trial dates were vacated because of

proceedings before the Federal Circuit. Consequently, this

Memorandum Decision does not address the “good cause” standard of

Rule 16.

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with considerations of ‘undue delay, bad faith or dilatory motive

on the part of the movant, repeated failure to cure deficiencies

by amendments previously allowed, undue prejudice to the opposing

party by virtue of allowance of the amendment, futility of

amendment, etc.’ Foman v. Davis, 371 U.S. 178, 182 ... (1962).” 

Schlacter-Jones v. General Telephone of California, 936 F.2d 435,

443 (9 Cir. 1991). “These factors, however, are not of equal th

weight in that delay, by itself, is insufficient to justify

denial of leave to amend.” DCD Programs, 833 F.2d at 186; see

also Jones, 127 F.3d at 847 n.8. “[I]t is the consideration of

prejudice to the opposing party that carries the greatest weight

... Absent prejudice, or a strong showing of any of the remaining

Foman factors, there exists a presumption under Rule 15(a) in

favor of granting leave to amend.” Eminence Capital, LLC v.

Aspeon, Inc., 316 F.3d 1048, 1052 (9 Cir.2003). “The party th

opposing leave to amend bears the burden of showing prejudice.” 

Serpra v. SBC Telecommunications, Inc., 318 F.Supp.2d 865, 870

(N.D.Cal.2004).

B. Application of Factors.

Here, Cameron’s opposition to Duhn’s motion is limited to

the factors of undue delay, prejudice, and futility. 

1. Undue Delay.

“‘[L]ate amendments to assert new theories are not reviewed

favorably when the facts and the theory have been known to the

party seeking amendment since the inception of the cause of

action.’” Kaplan v. Rose, 49 F.3d 1363, 1370 (9 Cir.1994), th

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quoting Acri v. International Ass’n of Machinists, 781 F.2d 1393,

1398 (9 Cir.), cert. denied, 479 U.S. 816 (1986). As explained th

in Sierra Club v. Union Oil Co. of California, 813 F.2d 1480,

1493 (9 Cir. 1987), vacated on other grounds, 485 U.S. 931 th

(1988):

We have held that where the party seeking

amendment knows or should know of the facts

underlying the amendment when the original

complaint is filed, the motion to amend may

be denied ....

Mere delay in proffering an amendment does

not justify denying leave to amend ... The

court has also held that where a defendant is

on notice of the facts contained in an

amendment to a complaint, there is no

prejudice to defendant in allowing the

amendment ... Here, where all of the

amendments were based upon facts contained in

Union Oil’s own records, Union Oil had notice

of the facts. Thus, there was no prejudice

to Union Oil.

Duhn asserts that it has not unduly delayed in seeking leave

to amend. Duhn contends that its proposed amendment simply seeks

to conform the pleadings to the parties’ conduct: “The parties

have always understood and acted from the outset of the case that

manufacture, use, and indirect infringement are asserted

infringing acts.” Duhn refers to the amount of discovery

conducted by the parties relative to issues of manufacture, use,

and indirect infringement, assertions that are not disputed by

Cameron.

Cameron argues that this factor weighs against leave to

amend: 

Duhn Oil seeks leave to add these substantial

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new claims for alleged infringement at the

final stage of this case, over four years

after Duhn Oil filed its original Complaint,

and over two years after Defendant Cameron

specifically notified Duhn Oil in the 2007

summary judgment proceedings that it had not

pled these allegations in its Complaint. 

Cameron refers to its memorandum in response to Duhn’s motion for

partial summary judgment and validity as to asserted claims filed

on December 6, 2007, (Doc. 170, pp. 3-4):

Plaintiff Duhn Oil’s allegations of

infringement in its Complaint assert that

Defendant Cameron ‘has offered for sale,

sold, is offering for sale and/or is selling

... products which infringe the ‘925 patent.’

... This is an allegation for ‘direct’

infringement for alleged sales and offers for

sale of the accused products. This

allegation of ‘direct’ infringement is

distinct from an allegation of ‘indirect’

infringement, such as ‘inducement’ or

‘contributory infringement,’ which Plaintiff

has not pled.

Duhn replies that it did not delay in bringing this motion

for leave to conform its pleadings to the parties litigation

conduct. Duhn asserts that Cameron raised its objections to

Duhn’s pleading of manufacture and use for the first time at the

hearing on December 7, 2009 regarding Cameron’s motion for

clarification or reconsideration of the Memorandum Decision

denying Cameron’s motion to strike the First Amended Complaint. 

(Doc. 310). Duhn contends that Cameron never disputed the

sufficiency of Duhn’s pleading regarding manufacture and use

prior to the December 7, 2009 hearing. Duhn contends that,

although Cameron raised an issue regarding the sufficiency of

Duhn’s pleading of indirect infringement in the summary judgment

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proceedings, Duhn’s responses put Cameron on notice that indirect

infringement was a claimed infringing act:

Despite Cameron’s objections, the pleading

issue regarding indirect infringement was

never addressed by the Court when it heard

Duhn’s summary judgment motion on May 5,

2008. Therefore, there has been no

definitive ruling on whether Duhn has

sufficiently pled indirect infringement, and

Duhn was thus not under any notice to amend

its pleading. 

Here, the record establishes that the parties conducted

discovery relevant to the issues of manufacture and use, and

contributory and inducement infringement of the accused frac

mandrels. These issues are no surprise to Cameron; nor are

claims based on this discovery. While it is arguable that Duhn

should have sought leave to amend in 2007, Duhn’s consistent

position has been that the pleadings sufficiently placed Cameron

on notice that Duhn’s claims of patent infringement included the

use and manufacture of the accused devices. Mere delay in

seeking leave to amend is not a valid ground for denial of leave

to amend, absent a showing of prejudice.

Despite the Court’s urging that the parties proceed to

trial, the pending interlocutory appeal has caused the trial date

to be vacated with no new trial date in sight.

2. Prejudice.

“Prejudice typically arises where the opposing party is

surprised with new allegations which require more discovery or

will otherwise delay resolution of the case ... The party

opposing the motion bears the burden of showing prejudice.” 

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Sharper Image Corp. v. Target Corp., 425 F.Supp.2d 1056, 1080

(N.D.Cal.2006).

Cameron argues that it will be severely prejudiced by the

proposed Second Amended Complaint’s new claims of making, using,

contributory and inducement infringement. 

Cameron asserts that Duhn is seeking through the proposed

amendments a substantial award of monetary damages for alleged

acts of infringement that occurred prior to the amendment, a time

in the past that Cameron now cannot go back to and modify its

accused frac mandrel products or installation procedures to avoid

liability. Cameron argues that, when the Complaint alleged

direct infringement for selling or offering to sell infringing

products, Cameron could avoid liability by not seeking or

offering for sale a “wellhead assembly” having all of the

required elements of the ‘925 Patent claims: “Cameron could avoid

all of the asserted liability by continuing its standard practice

of not selling or offering to sell ‘casing’ or ‘production

tubular members’ with its frac mandrel sales and rentals.” If

Duhn is allowed to amend to include allegations of patent

infringement based on making and using an infringing product,

Cameron asserts:

Duhn Oil would then assert liability for acts

of alleged infringement including Cameron’s

past installations of its Old Style frac

mandrels at the customer’s well site, where

Cameron’s past installations of its Old Style

frac mandrels were made up in a wellhead

assembly including a casing and production

tubing. And with these new allegations of

infringement then at issue for past

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installations, Cameron would not be able to

go back in time to take additional steps to

avoid the asserted liability by modifying its

frac mandrel products or installation

procedures.

Cameron asserts that, had it known at the outset of this case

that Duhn’s pleadings would be amended to include “making and

using to encompass Cameron’s installations of its Old Style frac

mandrels, and Cameron knew that Duhn Oil eventually would end up

limiting the asserted scope of its patent claims to require a

‘dual load path’ configuration, then Cameron could have, and

would have, taken additional steps to modify its frac mandrel

products and installation procedures for those installations of

the Old Style frac mandrel in the early stages of this case to

make sure that the tubing head lockscrews in its frac mandrels

were not run in to contact the frac mandrel.” Cameron argues

that Duhn’s “assertion of its patent in this case has effectively

become a game of gotcha, more akin to entrapment than the noble

assertion of exclusive rights to an invention.” 

Cameron argues that the assertion of new claims for indirect

infringement, including contributory infringement and inducement,

would cause it the same type of extreme prejudice. Cameron

asserts that it has put into place procedures with regard to the

New Style and Original Design frac mandrels which will safely

assure that Cameron cannot be found to have contributed to or

induced others to infringe the ‘925 Patent claims, each of which,

Cameron contends, require that the tubing head lockscrews be in

contact with the frac mandrel. As to the Old Style frac

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mandrels, Cameron argues:

Cameron cannot go back in time to provide

these same notification procedures or

retroactively apply the notice plates to

Cameron’s Old Style frac mandrels for its

prior installations from the early stages of

this case. If Cameron had known at the

outset of this case that Duhn Oil’s pleadings

would be retroactively modified to include

acts of alleged infringement other than

direct infringement for selling or offering

to sell, to include acts alleged to

contribute to or induce the infringement of

others, and Cameron knew that Duhn Oil

eventually would end up limiting the asserted

scope of its patent claims to require a ‘dual

load path’ configuration, then Cameron could

have, and would have, taken additional steps

to include notification procedures regarding

the use of its frac mandrel products, such as

notice plates on each of its frac mandrels,

to instruct others that the tubing head

lockscrews are not to be run in to contact

Cameron’s frac mandrel. 

As Duhn notes, Cameron does not contend it is prejudiced by

the proposed amendments because additional discovery will be

required or that leave to amend will delay resolution of the

case. 

Duhn characterizes as “pure fiction” that Cameron’s

statement that Duhn “is seeking through amendment a substantial

award of monetary damages (millions of dollars) for acts of

alleged infringement that occurred prior to the amendment.” Duhn

contends that the proposed amendment does not alter the damage

reports as the parties have always litigated this case with

manufacture, use, and indirect infringement as asserted

infringing acts, and have already accounted for these acts in

their damages analyses. Duhn refers to the Declaration of

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William J. Kolegraff, filed on January 6, 2010, (Doc. 382-2):

2. The parties have already conducted and

completed extensive discovery on manufacture,

use, and indirect infringement in this case,

so Duhn’s proposed Second Amended Complaint

will not require any further discovery on

these issues.

3. Duhn’s expert financial reports already

account for making, using, and indirect

infringement, as alleged in Duhn’s Second

Amended Complaint. Duhn’s proposed amendment

will not change the expert damages reports.

4. If Duhn is not granted leave to file its

Second Amended Complaint, Duhn’s expert will

be required to undertake a reassessment of

his damages analysis, and will issue amended

expert damage reports. As such a parsing of

infringing acts was never contemplated,

additional discovery may need to be taken to

complete the reassessment.

Duhn asserts that Cameron already knows that Duhn is seeking

millions of dollars in damages. Duhn refers to its initial

damages report issued on June 29, 2007, in which Duhn’s expert

laid out the facts and financial analysis showing that Cameron’s

exposure was already in the millions of dollars, and later-issued

supplemental reports showing the damages growing by millions of

dollars as Cameron made additional sales of its allegedly

infringing frac system. Duhn refers to paragraph 14 of Cameron’s

June 19, 2007 expert report:

I understand from Mr. Devlin that Duhn is

claiming that the ‘925 patent relates to a

way of connecting and securing the frac

mandrel to the tubing head by using certain

flanges which, during the well activation

process transfers the force between the frac

mandrel and tubing head to manage the extreme

pressures during the fracturing process. 

Therefore, it is anticipated that Duhn seeks

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a reasonable royalty for the value associated

with the patented technology as it is accused

of being used by Cameron.

No copy of Cameron’s expert report is attached; however, Cameron

did not object to consideration of this quotation at the hearing

or thereafter.

Duhn replies that Cameron’s claim that, had it known that it

would be alleged to have manufactured or used the Old Style frac

mandrel, or to have induced or contributed to infringement

regarding the Old Style frac mandrel, it would have made changes

earlier, is “meaningless” and “utterly baseless.” Duhn refers to

evidence that Cameron’s customers and installers continue to

engage the lockscrews of Cameron’s frac mandrels, despite

Cameron’s revisions to its installation manuals and modifications

of its frac mandrels. 

Cameron’s assertions of prejudice is not persuasive. The

assertion of prejudice is based solely on potentially increased

monetary liability and an asserted inability to retroactively

design around the Old Style frac mandrel. However, it is not

disputed by Cameron that additional discovery will be necessary

or that the trial of this action will be delayed by the

additional allegations. Cameron’s claim of prejudice is not the

type of prejudice that will foreclose Cameron’s ability to

defend. 

3. Futility.

Leave to amend may be denied if the proposed amendment is

futile or would be subject to dismissal. Saul v. United States,

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928 F.2d 829, 843 (9 Cir.1991). Leave to amend may be denied th

based upon futility alone. Bonin v. Calderon, 59 F.3d 815, 845

(9 Cir.1995). A claim is considered futile and leave to amend th

shall not be given if there is no set of facts that can be proved

under the amendment that would constitute a valid claim. Miller

v. Rykoff-Sexton, Inc., 845 F.2d 209, 214 (9 Cir.1988). th

However, denial on this ground is rare and courts generally defer

consideration of challenges to the merits of a proposed amended

pleading until after leave to amend is granted and the amended

pleading is filed. Netbula, LLC v. Distinct Corp., 212 F.R.D.

534, 539 (N.D.Cal.2003), citing Schwarzer, California Practice

Guide: Federal Civil Procedure Before Trial at 8:422 (The Rutter

Group, 2002). 

Cameron asserts that Duhn’s proposed amendment to assert a

claim for inducement to infringement fails to plead a number of

required elements, citing DSU Medical Corp. v. JMS Co., Ltd., 471

F.3d 1293 (Fed.Cir.2006). In DSU Medical Corp., the Federal

Circuit addressed “in the context of induced infringement, ‘the

required intent ... to induce the specific acts on [infringement]

or additionally to cause an infringement.’”

Id. at 1304. The Federal Circuit stated: 

Under section 271(b), ‘[w]hoever actively

induces infringement of a patent shall be

liable as an infringer.’ ... To establish

liability under section 271(b), a patent

holder must prove that once the defendants

knew of the patent, they ‘actively and

knowingly aid[ed] and abett[ed] another’s

direct infringement.’ ... However, ‘knowledge

of the acts alleged to constitute

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infringement’ is not enough ... The ‘mere

knowledge of possible infringement by others

does not amount to inducement; specific

intent and action to induce infringement must

be proven.’

...

It must be established that the

defendant possessed specific intent

to encourage another’s infringement

and not merely that the defendant

had knowledge of the acts alleged

to constitute inducement. The

plaintiff has the burden of showing

that the alleged infringer’s

actions induced infringing acts and

that he knew or should have known

his actions would induce actual

infringements.

Id. at 1305-1306. Cameron asserts that Duhn’s proposed amendment

fails to plead Cameron’s knowledge of the ‘925 Patent and

Cameron’s specific intent to induce another’s direct

infringement. Cameron argues that its repeated attempts

thoughout this litigation to modify its accused products and

installation procedures to make sure that the products do not

infringe the ‘925 Patent, by phasing out its prior Old Style frac

mandrel and re-configuring its design to make sure that the

tubing head lock screws are not run into contact with the frac

mandrel, demonstrates that Cameron never intended that its

customers’ use of Cameron’s frac mandrel could infringe any

claims of the ‘925 Patent. 

Duhn responds that Paragraph 6 of the proposed Second

Amended Complaint alleges Cameron’s knowledge of the ‘925 Patent:

6. Defendant, by itself or in concert with

others, manufactured, used, offered for sale,

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sold, is manufacturing, using, offering for

sale and/or is selling ... products which

infringe the ‘925 Patent, literally and/or

pursuant to the Doctrine of Equivalents,

and/or by otherwise contributing to

infringement of inducing others to infringe

the ‘925 Patent. 

Duhn asserts that mere awareness of the patent is sufficient to

establish the knowledge requirement for induced infringement. As

authority, Duhn cites DSU Medical Corp., supra, 471 F.3d at 1304

as “explaining that the inducing infringement standard was

satisfied ‘because it is undisputed that [the alleged infringer]

had notice of the patent.’” No such statement appears in the DSU

Medical Corp. opinion, in the portion of the opinion discussing

inducing infringement. Duhn also asserts that the proposed

Second Amended Complaint alleges that Cameron’s knowledge of the

‘925 Patent goes back at least as far as November 5, 2005, when

this action was filed, referring to Paragraph 7. 

Duhn asserts that Paragraph 7's allegation that Cameron “has

provided manuals and training to third parties for knowingly

inducing them to infringe the ‘925 Patent,” sufficiently alleges

Cameron’s requisite intent to state a claim for inducing

infringement. Duhn cites Manville Sales Corp. v. Paramount

Systems, Inc., 917 F.2d 544, 554 (Fed.Cir.1990): 

It must be established that the defendant

possessed specific intent to encourage

another’s infringement and not merely that

the defendant had knowledge of the acts

alleged to constitute infringement.

Cameron contends that Duhn’s proposed amendment to assert a

claim for contributory infringement, based on the allegation that

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Cameron’s accused frac mandrels “have no substantial noninfringing use,” is futile: 

Considering the Court’s summary judgment

finding of no infringement for Cameron’s

accused frac mandrels configured with the

lock screws not in contact with the frac

mandrel, this proposed new infringement claim

would not make it past summary proceedings. 

Duhn responds that evidence supports this claim because

Cameron’s modifications to its frac mandrels and procedures have

failed to stop on-going infringement, referring to inspections,

testimony, and checklists that the lockscrews continue to be

torqued-in to infringe the ‘925 Patent.

Cameron has not demonstrated that leave to amend to file the

proposed Second Amended Complaint will be futile under the

standards set forth above. Cameron’s contentions are primarily

factual and provide no basis for denial of Duhn’s motion on this

ground.2

CONCLUSION 

For the reasons stated:

1. Plaintiff Duhn Oil Tool’s motion for leave to file a

Second Amended Complaint is GRANTED;

2. Plaintiff Duhn Oil Tool shall file the proposed Second

Amended Complaint within ten (10) days following electronic

At the January 25, 2010 hearing on Duhn’s motion for leave to 2

amend, Cameron asserted the bar of the statute of limitations to

the proposed Second Amended Complaint. Because this ground for

denial of the motion was asserted for the first time at the

hearing, the Court does not consider it. In any event, it can be

asserted as a defense, if Cameron can establish that the claim does

not relate back to the original filing date under Fed. R. Civ. P.

15. 

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service of this Memorandum Decision and Order.

IT IS SO ORDERED.

Dated: February 16, 2010 /s/ Oliver W. Wanger 

668554 UNITED STATES DISTRICT JUDGE

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