Source: https://www.iplitigationcurrent.com/2014/01/27/declaratory-judgment-claimants-which-products-are-you-saying-dont-infringe/
Timestamp: 2019-04-20 07:08:05+00:00

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DJ Claimants: Which Products Are You Saying Don’t Infringe?
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Declaratory Judgment Claimants: Which Products Are You Saying Don’t Infringe?
Declaratory judgment plaintiffs and counterclaimants in patent cases have long been accustomed to filing boilerplate claims that either do not identify an accused technology, or that do so in a cursory manner. Noninfringement pleadings typically read something like this: “We are entitled to declaratory judgment that we have not infringed any valid claim of the ‘123 patent.” In many cases, this form of pleading goes unchallenged because there is no confusion about the identity of the product or process that has been accused of infringement. Recently, however, district courts have become increasingly inclined to dismiss noninfringement claims that do not sufficiently identify the technology that supposedly does not infringe. As discussed below, even Form 18-style pleadings may prove inadequate if the description of the accused product or process is too vague to create an “actual controversy” within the meaning of the Declaratory Judgment Act.
As has become well-known, the Supreme Court’s rulings in Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 556 U.S. 662 (2009) hold that Rule 8(a) requires a case-initiating pleading to state sufficient facts to make the claim plausible. Thus, “labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555. A separate source of authority is Form 18 of the Federal Rules of Civil Procedure, which explicitly endorses the following example of a patent infringement pleading: “The defendant has infringed and is still infringing the Letters Patent by making, selling, and using electric motors that embody the patented invention.” The Federal Circuit has recently made clear that “to the extent any conflict exists between Twombly (and its progeny) and the Forms regarding pleadings requirements, the Forms control.” K-Tech Telecomms., Inc. v. Time Warner Cable, Inc., 714 F.3d 1277, 1283 (Fed. Cir. 2013). Although Form 18 provides an example of an affirmative infringement claim, district courts have held that it applies to declaratory judgment claims as well. See, e.g., Microsoft Corp. v. Phoenix Solutions, Inc., 741 F. Supp. 2d 1156, 1163 (C.D. Cal. 2010).
In the context of a declaratory judgment action, however, the Declaratory Judgment Act itself must also be considered. 28 U.S.C § 2201 provides that the existence of an “actual controversy” is an absolute predicate for subject matter jurisdiction. The Federal Circuit has held that in the context of a patent action, an actual controversy exists “where a patentee asserts rights under a patent based on certain identified ongoing or planned activity of another party, and where that party contends that it has the right to engage in the accused activity without license.” SanDisk Corp. v. STMicroelectronics, Inc., 480 F.3d 1372, 1381 (Fed. Cir. 2007) (emphasis added).
In view of the risk that a noninfringement counterclaim may itself be dismissed without regard to the scope of the allegations in a patent holder’s complaint, defendants facing vague claims for patent infringement might consider moving to dismiss such claims before seeking declaratory judgment relief.
Form 18 expressly approves of a sample pleading that identifies “electric motors” as the accused product. That only makes any sense, however, if both parties know which electric motors are at issue. Problems arise in two scenarios: (1) if the party seeking declaratory judgment sells multiple varieties of the product, only some of which might be accused of infringement; and (2) if the allegedly noninfringing technology is not accessible to the public and its existence, though suspected, cannot be confirmed by the patentee.
An example of the first variety of case is Xilinx, Inc. v. Invention Inv. Fund I LP, No. 11-0671, 2011 U.S. Dist. LEXIS 81986 (N.D. Cal. July 27, 2011). In Xilinx, the declaratory judgment plaintiff sought a declaration that its “integrated circuits” did not infringe. The court dismissed the complaint, finding “integrated circuits” to be too broad a category, and holding that the complaint “fail[ed] to identify a single accused product that would provide defendants with sufficient notice of what products or product components are in contention and why they do not infringe on the patents at issue.” Id. at *19-20.
In sum, despite the language of Form 18, identifying a general category of “electric motors” will not save a declaratory judgment claim from dismissal if the patentee does not know which technology is at issue, or whether that technology is implemented in a manner that the patentee would deem infringing. The Essai case further shows that declaratory judgment plaintiffs may need to balance their desire not to disclose information about their technology with the realities of formal pleading requirements.

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