Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_06-cv-01572/USCOURTS-casd-3_06-cv-01572-1/pdf.json

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

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1 06cv1572

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

JENS ERIK SORENSEN, as Trustee of

SORENSEN RESEARCH AND

DEVELOPMENT TRUST,

Plaintiff,

CASE NO. 06cv1572 BTM (CAB)

ORDER:

(1) DENYING DEFENDANT’S

MOTION FOR SUMMARY

JUDGMENT [Doc. #18]

(2) GRANTING PLAINTIFF’S

MOTION TO JOIN ADDITIONAL

PARTIES AND FILE FIRST

AMENDED COMPLAINT [Doc. #12];

(3) DENYING PLAINTIFF’S MOTION

TO STRIKE ANSWER [Doc. #9];

and

(4) DENYING PLAINTIFF’S MOTION

TO NAME DEFENDANT DOES

[Doc. #44]

vs.

THE BLACK & DECKER

CORPORATION,

Defendant.

On August 7, 2006, Plaintiff Jens Sorensen, as Trustee of the Sorensen Research and

Development Trust (“Sorensen”), filed a complaint against The Black & Decker Corporation

(“Black & Decker”) for infringement of its United States Patent No. 4,935,184 (“‘184 patent”),

which pertains to injection molding of hollow plastic products. The complaint alleges that

Black & Decker has in the past, and does presently, make, import, sell or offer for sale

products for which the two plastic component external shells are manufactured through

processes which incorporate all elements of the ‘184 patented process. The complaint lists

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 Plaintiff has since filed three notices of newly discovered products, which it alleges

infringe the ‘184 patent, making the total number of accused products in excess of 200.

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approximately 150 products, which it alleges are sold by Black & Decker under one of its

brand names.1

On September 18, 2006, after Black & Decker filed its answer to Plaintiff’s complaint,

Plaintiff moved to strike Black & Decker’s answer claiming that it failed to properly respond

to the allegations in the complaint. On September 29, Black & Decker filed an amended

answer to Plaintiff’s original complaint, which addressed these purported inadequacies.

Meanwhile, on September 26, 2006, Plaintiff filed a motion to join additional parties

and to file a first amended complaint incorporating those parties. In particular, Plaintiff

moved to add: Black & Decker, Inc.; Black & Decker (U.S.), Inc.; Porter-Cable Corporation;

Vector Products, Inc.; and DOES 1-1000. In connection with its motion, Plaintiff filed a first

amended complaint. Black & Decker has opposed this motion claiming that the only proper

defendant party in this action is Black & Decker (U.S.), Inc., which does manufacture and sell

a number of the products that Sorensen alleges infringe the ‘184 patent.

In connection with this opposition, Black & Decker also filed a motion for summary

judgment of non-infringement on October 2, 2006. In its motion, Black & Decker argues that

it is merely a holding company which does not make, use, sell, offer to sell or import into the

United States any products, including those that Sorensen alleges infringes its patent. Black

& Decker indicates that it offered Plaintiff the opportunity to substitute the proper party, Black

& Decker (U.S.), Inc., but its offer was rebuffed. Plaintiff has opposed this motion claiming

that genuine issues remain as to the material facts regarding the true nature and extent of

Black & Decker’s operations, and has requested more time to conduct discovery on Black

& Decker’s corporate structure.

All three of these motions were set for hearing on November 3, 2006 and the Court

took the motions under submission at that time. While these motions were pending, on

December 13, Plaintiff filed a motion to name two of the DOE defendants that it had moved

to add as additional parties in a first amended complaint. In particular, Plaintiff’s motion

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2

 Black & Decker had filed a request that the Court hear oral argument on its motion

for summary judgment of non-infringement. However, the Court has determined that oral

argument would not aid the Court in its determination. Accordingly, Black & Decker’s request

is denied.

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seeks to name DOES 1 and 2 as Phillips Plastics Corporation and Hi-Tech Plastics,

respectively. Black & Decker indicated that it did not oppose adding these two parties, but

it did object to Plaintiff’s procedural method of moving to name DOES in a first amended

complaint that had not yet been approved for filing by the Court. This final motion was set

for hearing on February 2, 2007. The Court, having considered all of the arguments

presented in the parties’ filings, now issues the following order pertaining to the four pending

motions in this case.2

I. DEFENDANT’S MOTION FOR SUMMARY JUDGMENT OF NON-INFRINGEMENT

Defendant Black & Decker has filed a motion for summary judgment arguing that it is

not properly a party to the patent infringement suit brought by Sorensen. For the reasons

set forth below, this motion is DENIED.

A. Background

Sorensen’s patent infringement suit alleges that Black & Decker has and continues

to infringe the ‘184 patent through the manufacture, import, offer for sale and/or sale of

certain plastic components used in more than 200 products. Specifically, Sorensen alleged

that Black & Decker directly infringed the patent, induced patent infringement, and also

contributed to patent infringement under 35 U.S.C. § 271(a)-(c).

Black & Decker has argued that it is merely a holding company maintaining the

intangible assets of its many subsidiaries and does not make, sell, offer for sale, or import

into the United States any products whatsoever. Instead, Black & Decker contends that

Black & Decker (U.S.), Inc., a wholly owned, separate and distinct legal subsidiary,

manufactures the accused products and is the proper Defendant.

B. Legal Standard

Summary judgment is appropriate if the moving party demonstrates that “the

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pleadings, depositions, answers to interrogatories and admissions on file, together with the

affidavits, if any, show that there is no genuine issue as to any material fact.” Fed. R. Civ.

P. 56(c)); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); Celotex Corp. v.

Catrett, 477 U.S. 317, 323 (1986). A fact is material when, under the governing substantive

law, it could affect the outcome of the case. See Anderson, 477 U.S. at 248; Freeman v.

Arpaio,125 F.3d 732, 735 (9th Cir. 1997). A dispute is genuine if a reasonable jury could

return a verdict for the nonmoving party. See Anderson, 477 U.S. at 248.

A party seeking summary judgment always bears the initial burden of establishing the

absence of a genuine issue of material fact. See Celotex, 477 U.S. at 323. Although the

nonmoving party bears the burden of proof on a matter at trial, the moving party must

demonstrate to the Court that there is insufficient evidence to support the nonmoving party’s

case. Id. at 325. The moving party, after allowing adequate time for discovery, can satisfy

this burden in two ways: (1) by presenting evidence that negates an essential element of the

nonmoving party’s case; or (2) by demonstrating that the nonmoving party failed to establish

an essential element of the nonmoving party’s case on which the nonmoving party bears the

burden of proof at trial. See Id. at 322-23. “Disputes over irrelevant or unnecessary facts

will not preclude a grant of summary judgment.” T.W. Elec. Serv., Inc. v. Pacific Elec.

Contractors Ass’n, 809 F.2d 626, 630 (9th Cir. 1987).

Once the moving party establishes the absence of genuine issues of material fact, the

burden shifts to the nonmoving party to set forth facts showing that a genuine issue of

disputed fact remains. See Celotex, 477 U.S. at 324. The nonmoving party cannot rest on

the mere allegations or denials of his pleading, but must “go beyond the pleadings and by

his own affidavits, or by the ‘depositions, answers to interrogatories, and admissions on file’

designate ‘specific facts showing that there is a genuine issue for trial.’” Id. (citing Fed. R.

Civ. P. 56(c)). When making this determination, the court must view all inferences drawn

from the underlying facts in the light most favorable to the nonmoving party. See Matsushita

Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986); Fontana v. Haskin,

262 F.3d 871, 876 (9th Cir. 2001). The court must not weigh the evidence or make credibility

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determinations in evaluating a motion for summary judgment. See Anderson, 477 U.S. at

255.

C. Direct Patent Infringement

To prove liability for direct patent infringement, Sorensen must show that Black &

Decker either: (1) makes, uses, offers to sell, sells, or imports products that use the ‘184

patent process without authorization; or (2) controls similar conduct undertaken by its

subsidiaries such that it justifies piercing the corporate veil. See Tegal Corp. v. Tokyo Elec.

Co., Ltd., 248 F.3d 1376, 1379 (Fed. Cir. 2001) (“In the absence of evidence showing that

the parent company either was an alter ego of the subsidiary or controlled the conduct of the

subsidiary, we refused to find direct infringement.”). Although Black & Decker maintains it

does neither of these, Sorensen has presented significant evidence contradicting these

contentions.

Sorensen has presented sufficient evidence showing Black & Decker’s manufacturing,

use, sale, offers to sell, or importation of products using the ‘184 patent process to present

a genuine issue of material fact. First, it appears Black & Decker has represented in federal

court that, through its subsidiaries, it indeed does design, manufacture, and sell home

products and power tools. (Ex. A to Kramer Decl.; Techtronic Complaint at ¶ 2.) Second,

on its worldwide website, Black & Decker publicly presents itself as “a global marketer and

manufacturer of quality products” and the “world’s largest producer of power tools and

accessories.” (Exs. G and H to Kramer Decl.) Further, the website markets Black & Decker

products, contains links to retail outlets selling their products, and even directly sells Black

& Decker products. (Ex. F to Kramer Decl.) Third, and most persuasive on the matter, is

Black & Decker’s own 2005 10-K SEC filing, which states that it is “a leading global

manufacturer and marketer” and “one of the world’s leading producers” of power tools and

accessories. (Ex. B to Kramer Decl. at 1.)

Additionally, Sorensen has also demonstrated that there is a genuine issue of material

fact as to whether Black & Decker controls the manufacturing, use, or sales activities of its

subsidiaries. There is apparently significant overlap in officers and directors between Black

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& Decker and its subsidiary Black & Decker (U.S.), Inc., which directly impugns express

contentions to the contrary by Black & Decker in this case. (See Kramer Decl. at ¶¶ 29-34

and referenced exhibits.) More importantly, Black & Decker has admitted in its amended

answer that it “controls the quality of products sold under its trademarks,” though the extent

of that “control” is not clear. (9/29/06 Amended Answer at ¶ 20.)

Taking the proffered evidence together, Sorensen has met his burden in defending

against summary judgment on direct infringement. The evidence raises significant questions

of fact about Black & Decker’s own manufacturing and sales activities as well as its corporate

structure, in particular, its managerial control over similar activities conducted by its

subsidiaries. Further, the evidence appears to directly contradict certain statements made

by Black & Decker in its papers, casting further doubt on its true corporate structure.

Additionally, the Court is persuaded that this motion was filed prematurely because, when

considering the relative youth of this case, the nature of the claims made, the evidence

discussed above, and the fact that no discovery had been conducted at the time of its filing,

it is apparent that Sorensen should be allowed a greater opportunity to conduct discovery

and develop his positions. Fed. R. Civ. P. 56(f); Celotex, 477 U.S. at 322. Accordingly, the

Court finds there is a material issue of fact as to Black & Decker’s involvement in conduct

that may directly infringe upon the ‘184 patent.

D. Inducement and Contributory Patent Infringement

Liability for inducement of patent infringement under 35 U.S.C. § 271(b) requires

Plaintiff to demonstrate that: (1) there was a direct infringement upon the ‘184 patent; and

(2) Black & Decker knowingly induced that infringement and possessed the specific intent

to encourage infringement. Minnesota Mining and Manufacturing Co. v. Chemque, Inc., 303

F.3d 1294, 1304-05 (Fed. Cir. 2002). As noted above, Plaintiff Sorensen has presented

sufficient proof such that there is a genuine issue of material fact as to the predicate act of

direct infringement by Black & Decker, or one of its subsidiaries. Further, although Sorensen

presents no specific evidence outside his averments in the complaint as to the second

element for inducing infringement, discovery had just begun when this motion was filed.

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Consequently, it would be unjust to grant summary judgment in favor of Black & Decker on

this issue when, given that Sorensen’s claims directly implicate internal Black & Decker

management schematics, more discovery is justifiably needed to present a fuller argument.

Fed. R. Civ. P. 56(f); Celotex, 477 U.S. at 322.

Under 35 U.S.C. § 271(c), “[w]hoever offers to sell or sells within the United States .

. . a component of a patented machine, manufacture, combination or composition . . .

constituting a material part of the invention, knowing the same to be especially made or

especially adapted for use in an infringement of such patent, and not a staple article or

commodity of commerce suitable for substantial noninfringing use, shall be liable as a

contributory infringer.” To prevail on a claim of contributory infringement, Sorensen must

prove that Black & Decker provides components knowing that “the combination for which its

components were especially made was both patented and infringing.” Golden Blount, Inc.

v. Robert H. Peterson Co., 365 F.3d 1054, 1061 (Fed. Cir. 2004). Sorensen must also show

that such components have no substantial non-infringing uses. Id. For the same reasons

that granting summary judgment upon the inducement of infringement allegation is

inappropriate at this time, summary judgment cannot be granted upon the contributory

infringement claim. Plaintiff is entitled to substantial discovery in order to permit him to make

a more full showing of Black & Decker’s potential involvement in allegedly infringing conduct.

F. Conclusion

The Court finds that genuine issues of material fact exist regarding Black & Decker’s

involvement in the manufacturing, use, marketing and/or sale of products that allegedly

infringe the ‘184 patent, or its possible inducement of or contribution to any such infringing

conduct. Accordingly, Defendant Black & Decker’s motion for summary judgment of noninfringement is DENIED without prejudice. Defendant’s arguments, if supported upon a full

record after sufficient time for discovery, may properly be addressed to the Court in a

subsequent motion for summary judgment. In addition, the Court would expect that, if

Plaintiff’s discovery of Black & Decker’s corporate structure reveals that Defendant’s claims

are true, Plaintiff is likely to voluntarily dismiss those Black & Decker entities uninvolved in

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3

 As explained in the introduction, Plaintiff has already moved to name two such DOE

defendants.

4

 If Defendant’s statements regarding the Porter-Cable Corporation are correct, and

it really is not a corporate entity, any concerns about the impropriety of adding it as a

defendant should evaporate when Plaintiff is unable to serve its summons because no such

entity exists to serve.

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the manufacture, marketing or sale of the allegedly infringing products.

II. PLAINTIFF’S MOTION TO JOIN ADDITIONAL PARTIES AND FILE A FIRST

AMENDED COMPLAINT INCORPORATING THOSE PARTIES

Plaintiff Sorensen has moved to join additional parties as defendants in this action and

to file a first amended complaint incorporating those new parties. In particular, Plaintiff

moved to add entities, alleged to be subsidiary corporations of Black & Decker, which it

claims are involved in the infringing conduct: Black & Decker, Inc.; Black & Decker (U.S.),

Inc.; Porter-Cable Corporation; Vector Products, Inc.; and DOES 1-1000. Plaintiff requests

that the DOE defendants be included to accommodate the later discovery of additional Black

& Decker subsidiary corporations and operating entities that may need to be named.3

Federal Rule of Civil Procedure 15(a) requires that leave to amend a complaint be

“freely given when justice so requires.” See Morongo Band of Mission Indians v. Rose, 893

F.2d 1074, 1079 (9th Cir. 1990) (Rule 15(a) amendment policy “is to be applied with extreme

liberality”). Plaintiff has fairly argued that justice requires this Court grant him the right to

name additional defendants, which he alleges are subsidiary corporate entities of the

originally named defendant. Plaintiff alleges that these corporate entities are involved in the

patent infringement at issue in this case. Defendant claims that only Black & Decker (U.S.),

Inc., and no other Black & Decker entity, including itself, is involved in the potentially

infringing conduct and, thus, amendment of the complaint to name any other parties would

be futile. For the same reasons expressed above in denying Defendant’s motion for

summary judgment, particularly the uncertainty of Black & Decker’s corporate structure, the

Court cannot find that Plaintiff’s amendment to add parties other than Black & Decker (U.S.),

Inc. would be futile.4

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5

 This objection was made, in part, in Defendant’s opposition to this motion and, in

part, in Defendant’s opposition to Plaintiff’s motion to name DOES 1 and 2, which is

addressed below.

6

 Plaintiff’s filing of a first amended complaint on September 26, 2006 was without

legal effect because it was without authority to do so. That filing shall be struck.

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In addition, Black & Decker objects to the addition of DOES 1-1000 on the ground that

the present action, which is brought upon a claim of patent infringement, is not appropriate

for the “DOE” procedure because there are no privacy concerns here and such pleading is

not necessary to prevent the running of the statute of limitations.5 While “DOE” pleading is

not specifically allowed under the Federal Rules of Civil Procedure, many courts have

allowed the practice. The courts have recognized that “where the identity of alleged

defendants will not be known prior to the filing of a complaint . . ., the plaintiff should be given

an opportunity through discovery to identify the unknown defendants.” Gillespie v. Civiletti,

629 F.2d 637, 642 (9th Cir. 1980); accord Wakefield v. Thompson, 177 F.3d 1160, 1163 (9th

Cir. 1999) (applying Gillespie); c.f. C.D. Cal. Civ. R. 19-1 (permitting filing of complaints with

up to 10 unnamed DOES). The Court finds that Plaintiff’s inability to identify certain

defendants prior to discovery is understandable in this instance and will permit the amended

complaint to include DOES 1-1000.

Accordingly, Plaintiff’s motion to join additional parties is GRANTED. Plaintiff is

directed to promptly file a first amended complaint and effect service of the amended

complaint on all parties.6

 The proper form for the amended complaint will be addressed

below in Section V.

III. PLAINTIFF’S MOTION TO STRIKE ANSWER AND DEEM AVERMENTS

ADMITTED

Plaintiff had previously moved to strike Defendant Black & Decker’s original answer

because its responses were insufficient. However, as was outlined in the introductory

section above, Defendant filed an amended answer eleven days after Plaintiff filed this

motion. As Plaintiff recognized in its October 17, 2006 reply brief, Defendant’s amended

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answer provided the relief sought in Plaintiff’s motion and, therefore, rendered the motion

moot. Accordingly, the Court DENIES Plaintiff’s motion as moot.

IV. PLAINTIFF’S MOTION TO NAME DEFENDANT DOES 1 AND 2

Plaintiff has moved to name Defendant parties previously identified as DOES 1 and

2 in its proposed first amended complaint. In particular, Plaintiff’s motion seeks to name

DOES 1 and 2 as Phillips Plastics Corporation and Hi-Tech Plastics. The motion is based

upon Plaintiff’s discovery that these corporations are involved in manufacturing the allegedly

infringing Black & Decker products. Defendant Black & Decker, while indicating that it does

not oppose adding these two parties, does object to Plaintiff’s procedural method of moving

to name DOES in a first amended complaint that has not yet been approved for filing by the

Court. As the Court has ruled above that Plaintiff’s previously filed First Amended Complaint

shall be struck and has granted Plaintiff’s motion to properly file an amended complaint, this

motion to name DOES has been rendered moot. Plaintiff, if he wishes, may add these

parties as named defendants in his new amended complaint. Accordingly, Plaintiff’s motion

is DENIED as moot.

V. CONCLUSION

Defendant Black & Decker’s motion for summary judgment [Doc. #18] is DENIED

without prejudice to its ability to file a renewed summary judgment motion upon these

grounds after allowing Plaintiff sufficient time for discovery. Plaintiff’s motion to strike

Defendant’s answer [Doc. #9] is DENIED as moot.

The First Amended Complaint filed on September 26, 2006 [Doc. #13] shall be struck

as prematurely filed. Plaintiff’s motion to name Defendant DOES 1 and 2 [Doc. #44] is

DENIED as moot. Plaintiff’s motion to join additional parties and file a first amended

complaint [Doc. #12] is GRANTED. Plaintiff is therefore directed to promptly file an amended

complaint within 20 days hereof which: (1) includes as named Defendants those entities

identified in Plaintiff’s motion for joinder of additional parties, specifically Black & Decker, Inc.,

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Black & Decker (U.S.), Inc., Porter-Cable Corporation, Vector Products, Inc., and unnamed

Defendant DOES 1-1000; and (2) may include as named Defendants Phillips Plastics

Corporation and Hi-Tech Plastics. Plaintiff is directed to serve the amended complaint upon

all parties to this action.

IT IS SO ORDERED.

DATED: February 23, 2007

Hon. Barry Ted Moskowitz

United States District Judge

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