IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF ILLINOIS 

EASTERN DIVISION 

ABC CORPORATION I, 

ABC CORPORATION II, 

Plaintiffs, 

v. 

THE PARTNERSHIPS AND 

UNINCORPORATED ASSOCIATIONS 

IDENTIFIED ON SCHEDULE “A”, 

Defendants. 

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Case No. 1:20-cv-04806 

Honorable Thomas M. Durkin 

MEMORANDUM OF LAW IN SUPPORT OF PLAINTIFFS’ MOTIONS TO DISMISS 

COUNTERCLAIM OF DEFENDANT GYROOR 

Defendant Gyroor has pled an antitrust counterclaim Count II. But that claim asserts none 

of the elements of a federal antitrust claim and is barred by the Noerr-Pennington doctrine. Similar 

to the now-dismissed antitrust counterclaim pled by co-defendant Gyroor-US, see Dkt. 443, p. 2–

3, this Court should dismiss Gyroor’s antitrust counterclaim Count II. 

BACKGROUND

On November 19, 2020, Plaintiffs filed their operative, Third Amended Complaint 

(“Complaint”). Dkt. 101. The Complaint alleges that various online stores primarily based outside 

of the United States, including Gyroor-US, sold and are selling hoverboard products in violation 

of four design patents issued to Plaintiff Hangzhou Chic Intelligent Technology Co. The 

Complaint expressly states that Plaintiffs “bring this action against the Defendants identified in 

attached Schedule A.” Id. at 1. The original Schedule A (Dkt. 101-14) did not list Gyroor because 

Plaintiffs believed that storefront to be an alter-ego of defendant Gyroor-US. To prevent GyroorUS from evading the preliminary injunction by hiding behind related, non-defendant entities, 

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Plaintiffs moved to add Gyroor as a defendants to Schedule A. Dkt. 227. Over Gyroor-US’s 

objection, the Court granted Plaintiffs’ motion. Dkt. 253. 

Plaintiffs served Gyroor with the Complaint and summons on June 25, 2021. Dkt. 310. 

Gyroor moved to dismiss Plaintiffs’ claims against it, which the Court denied. Dkts. 365, 449. 

Then Gyroor asserted counterclaims for non-infringement and violation of the antitrust laws. Dkt. 

465. Gyroor’s antitrust counterclaim (Count II) essentially alleges that Plaintiffs engaged in 

anticompetitive practices by initiating a sham litigation in an attempt to monopolize the hoverboard 

industry. Id. ¶¶ 148-163.1 Gyroor also alleges—without any supporting factual statements—that 

Plaintiffs “knowingly engag[ed] in inequitable conduct in the prosecution of their Patent.” Id. ¶ 

157. This Court, however, has held on two independent occasions that Plaintiffs have a “likelihood 

of success on the merits” and “have proved a prima facie case of design patent infringement.” Dkt. 

147 at 9; Dkt. 456 at 9. This Court previously dismissed a similar antitrust counterclaim pled by 

Gyroor-US. See Dkt. 443, p. 2–3 (“Defendant’s allegations and arguments otherwise fail to 

address the elements of a Sherman Act claim. Therefore, it is dismissed.”) 

ARGUMENT 

Gyroor’s antitrust counterclaim Claim II consists solely of conclusory and unsubstantiated 

statements that fail to satisfy the most basic of federal pleadings standards under Iqbal and 

Twombly. Even if Gyroor had adequately pled the elements of an antitrust violation, the NoerrPennington doctrine precludes antitrust liability when the allegedly anticompetitive act was 

prosecution of a lawsuit, unless an exception applies. The facts alleged, however, are inconsistent 

 

1

 Defendant has incorrectly numbered the paragraphs of its counterclaims, with the order 

proceeding from 6 to 75, omitting paragraphs 7-74. For purposes of this motion, Plaintiffs will 

refer to the paragraph numbers as they are written in Defendant’s pleadings. 

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with any exception to the Noerr-Pennington doctrine. Therefore, this Court should dismiss 

Gyroor’s antitrust counterclaim Count II under Rules 8 and 12(b)(6). 

I. Count II Must Be Dismissed Because It Does Not Satisfy Federal Pleading Standards 

Federal Rule of Civil Procedure 8, as interpreted by the Supreme Court in Iqbal and 

Twombly, sets the pleading standards in a patent case. See, e.g., Cleversafe, Inc. v. Amplidata, 

Inc., No. 11 C 4809, 2011 WL 6379300, 2011 U.S. Dist. LEXIS 145995, at *3 (N.D. Ill. Dec. 20, 

2011) (relying on Iqbal and Twombly to dismiss patent invalidity counterclaims); see also Groupon 

Inc. v. MobGob LLC, No. 10 C 7456, 2011 WL 2111986, 2011 U.S. Dist. LEXIS 56937 at *12–

13 (N.D. Ill. May 25, 2011). This standard requires more than “[t]hreadbare recitals of ... a cause 

of action, supported by mere conclusory statements.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). 

The Supreme Court has emphasized the particular need for rigorous enforcement of Rule 8 for 

antitrust claims. See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 558 (2007). 

Gyroor’s antitrust counterclaim does not satisfy Rule 8. As an initial matter, Gyroor fails 

to even identify under which section of the Sherman Act it brings these claims. See generally, 

Dkt. 465 ¶¶ 148-163. Gyroor does refer to “attempted monopolization by Plaintiffs.” Id., ¶ 159. 

This omission suggests that Gyroor attempts to bring its counterclaim under Section 2. See 15 

U.S.C. § 2 (prohibiting every “attempt to monopolize . . . any part of the trade or commerce among 

the several States”). To plead attempted monopolization, Gyroor must allege (1) Plaintiffs’ 

specific intent to achieve monopoly power in a relevant market; (2) predatory or anticompetitive 

conduct directed to accomplishing this purpose; and (3) a dangerous probability that the attempt 

at monopolization will succeed. GlobalTap LLC v. Smart Tap LLC, No. 13 C 5322, 2015 WL 

791256, 2015 U.S. Dist. LEXIS 21687, *15 (N.D. Ill. Feb. 24, 2015), citing Mercatus Grp., LLC 

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v. Lake Forest Hosp., 641 F.3d 834, 854 (7th Cir. 2011). But Gyroor has not properly pleaded any 

of these elements.2

 

Regarding the first element, nothing in Gyroor’s pleading establishes that Plaintiffs had the 

specific intent to achieve monopoly power in the hoverboard market. Gyroor alleges that Plaintiffs 

engaged in “affirmative and willful acts of attempted monopolization,” but offers no alleged 

facts—either direct or indirect—in support of this claim. Dkt. 465, ¶ 159. As to the second 

element, the only anticompetitive conduct alleged by Gyroor relates to harm it has suffered as a 

result of patent enforcement litigation. But for reasons explained infra Section II, plaintiffs who 

initiate a lawsuit in order to enforce their patent rights are immune to antitrust claims premised on 

that litigation. 

As to the third element, pleading a dangerous probability of monopolization requires 

“identify[ing] the relevant market and apprais[ing] [Plaintiffs’] exclusionary power within that 

market.” GlobalTap LLC, 2015 U.S. Dist. LEXIS 21687, at *15–16. For “alleged bad faith 

enforcement of a patent to create or threaten to create monopoly power, the patent must dominate 

a real market.” Pollenex Corp. v. Sunbeam-Home Comfort, No. 92 C 98, 1992 WL 199080, 1992 

U.S. Dist. LEXIS 11735, at *4–5 (N.D. Ill. Aug. 6, 1992), aff’d without op., 39 F.3d 1197 (Fed. 

 

2

 Plaintiffs observe that discerning the actual alleged wrongdoing here presents a challenge, 

because many of the allegations are not entirely coherent. For example, Gyroor at one point 

suggests that the court has dissolved the preliminary injunction. See, e.g., Dkt. 465, ¶ 152 (“Absent 

a court judgment in Defendant’s favor, the preliminary injunction would have remained in place . 

. . .”). The longest antitrust allegation seems to consist, in part, of a sentence fragment. See id., ¶ 

151 (“Plaintiffs intentionally targeted its competitor Gyroor brand because . . . the resellers whose 

assets restrained enforced indemnification in all aspect from Defendant.”). Further, Gyroor seems 

to admit that all of the remaining defendants in this case are the exact same defendant, despite 

having previously disputed that assertion. See id. ¶ 158 (“[M]ost of the defendants reached 

settlement by signing the licensing agreement, except two, Defendant in this case and DGL Group, 

Ltd.”). 

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Cir. 1994). Here, Gyroor makes no allegations that Plaintiffs’ asserted patents dominate the 

market. The closest Gyroor comes is pure speculation regarding hypothetical events: “When each 

and every hoverboard sold in the market will have to pay royalt[ies] to Plaintiffs . . . [that] will 

ultimately result [in] a monopoly.” Dkt. 465, ¶ 154. Absent well-pleaded allegations that 

Plaintiffs’ asserted patents do presently dominate a real market, Gyroor has not pleaded the third 

element of an attempted monopolization claim. 

Thus, the antitrust counterclaim Claim II is not well-pleaded and should be dismissed. 

II. Count II Must Be Dismissed Under The Noerr-Pennington Doctrine 

Even if Gyroor had properly pleaded its antitrust claim, the claim would still fail as a matter 

of law. Gyroor’s antitrust claim appears to be based solely on Plaintiffs’ attempts to enforce their 

design patent rights through this litigation. But under the Noerr-Pennington doctrine, “[t]hose 

who petition government for redress are generally immune from antitrust liability.” Prof’l Real 

Estate Inv’rs, Inc. v. Columbia Pictures Indus., Inc., 508 U.S. 49, 56 (1993). Patentees, like 

Plaintiffs here, have Noerr-Pennington immunity from antitrust suits if they conformed to patent 

law in procuring and enforcing their patents. See Q-Pharma, Inc. v. Andrew Jergens Co., 360 F.3d 

1295, 1304 (Fed. Cir. 2004) (“A patent owner who brings a suit for infringement, without more, 

is generally exempt from the antitrust laws for that action . . . .”); see also Indus. Models v. SNF, 

Inc., 716 F. App’x 949, 956 (Fed. Cir. 2017) (affirming dismissal of antitrust counterclaims on the 

basis of Noerr-Pennington). This immunity applies “even when litigation has anticompetitive 

effects.” GlobalTap LLC, 2015 U.S. Dist. LEXIS 21687, at *14. 

Here, the conduct alleged in support of Gyroor’s antitrust claim falls squarely within the 

Noerr-Pennington doctrine. See Dkt. 465 ¶ 150 (“Plaintiffs brought this suit for the improper

purpose of excluding Defendant’s noninfringing product from the market.”) To overcome NoerrPennington immunity, a defendant must be able to establish one of the doctrine’s two exceptions: 

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“(1) that the asserted patent was obtained through knowing and willful fraud . . . or (2) that the 

infringement suit was a mere sham to cover what is actually nothing more than an attempt to 

interfere directly with the business relationships of a competitor.” Nobelpharma AB v. Implant 

Innovations, Inc., 141 F.3d 1059, 1067-68 (Fed. Cir. 1998). Gyroor purports to invoke both 

exceptions. 

First, Gyroor claims that Plaintiffs “knowingly engaged in inequitable conduct in the 

prosecution of their patent.” See Dkt. 465 ¶ 147. In other words, Gyroor accuses Plaintiffs, without 

any evidence or factual allegations, of obtaining their patents through fraudulent means. But such 

a “fraud on the PTO” allegation is subject to Rule 9(b). See Sun-Flex Co. v. Softview Comput. 

Prods. Corp., 750 F. Supp. 962, 963 (N.D. Ill. 1990) (granting motion to strike under Rule 12(f) 

because defendant’s inequitable conduct affirmative defense failed to “specify the time, place, and 

content of any alleged misrepresentations that plaintiff made to the PTO.”). For example, Gyroor 

must allege the specific individual accused of inequitable conduct, along with facts to support an 

inference that the named individual both knew of the material information allegedly withheld, and 

deliberately withheld it with an intent to deceive the PTO. Exergen Corp. v. Wal-Mart Stores, 

Inc., 575 F.3d 1312, 1326 (Fed. Cir. 2009). But Gyroor does not plead what the misrepresentations 

were, the specific individual who made them, when they were made, where they were made, and 

how they were made. Taken together, this allegation fails to satisfy the pleading requirements of 

Rule 8, let alone the higher specificity requirements of Rule 9(b). 

Second, Gyroor attempts to overcome Noerr-Pennington immunity by invoking the “sham 

litigation” exception. See Dkt. 465 ¶¶ 149, 151, 153, 155, 156. A lawsuit is a sham “when it is 

pursued in order to impose high costs of defending rather than in order to obtain relief.” Vill. of 

Bolingbrook v. Citizens Utils. Co. of Ill., 864 F.2d 481, 483 (7th Cir. 1988). But Gyroor has not 

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alleged—nor could it possibly allege—sufficient facts to demonstrate that this exception is 

remotely applicable. To trigger the exception, Gyroor must offer enough facts to raise a plausible 

inference that Plaintiffs’ bringing of this case was “objectively baseless,” i.e., that “no reasonable 

litigant could realistically expect success on the merits.” GlobalTap, 2015 U.S. Dist. LEXIS 

21687, at *20. Gyroor’s only effort to satisfy this element is merely parroting the language of the 

requirement. Dkt. 465, ¶ 155 (“[N]o reasonable person could realistically expect success on the 

merits of the sham infringement action . . . .”). In addition to not being well-pleaded, the allegation 

is implausible: this Court has held, on two separate occasions, that Plaintiffs actually have 

established a “likelihood of success on the merits” and “have proved a prima facie case of design 

patent infringement.” Dkt. 147 at 9; Dkt. 456 at 9. And this Court has found Gyroor in contempt 

for violating the preliminary injunction associated with those two previously-mentioned findings. 

Dkt. 444. 

Gyroor’s counterclaim therefore fails to establish an exception to the Noerr-Pennington

doctrine. 

CONCLUSION 

Because Gyroor’s antitrust claim Count II is insufficiently pleaded and does not state a 

legally cognizable claim, and because Plaintiffs’ infringement lawsuits are immunized from 

antitrust claims under the Noerr-Pennington doctrine, this Court should dismiss Count II under 

Rule 12(b)(6). 

Date: November 12, 2021 Respectfully Submitted, 

LOEB & LOEB LLP 

 /s/ Adam Kelly 

Adam Kelly 

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Doug Masters 

Arthur Yuan 

Neil Nandi 

321 North Clark Street, Suite 2300 

Chicago, Illinois 60654 

Tel.: 312-464-3100 

Email: akelly@loeb.com 

Email: dmasters@loeb.com

Email: ayuan@loeb.com 

Email: nnandi@loeb.com 

Marwa Abdelaziz (admitted pro hac vice) 

LOEB & LOEB LLP 

345 Park Avenue 

New York, New York 10154 

Tel.: (212) 407-4000 

Email: mabdelaziz@loeb.com 

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