Court Opinion

ID: 4271423
Source: CourtListenerOpinion
Date Created: 2018-05-01 15:00:42.38746+00
Date Added: 2024-06-11T14:32:50.954410
License: Public Domain

United States Court of Appeals
      for the Federal Circuit
                ______________________

         DISC DISEASE SOLUTIONS INC.,
                Plaintiff-Appellant

                          v.

VGH SOLUTIONS, INC., DR-HO’S, INC., HOI MING
              MICHAEL HO,
            Defendants-Appellees
           ______________________

                      2017-1483
                ______________________

   Appeal from the United States District Court for the
Middle District of Georgia in No. 1:15-cv-00188-LJA.
                  ______________________

                 Decided: May 1, 2018
                ______________________

    CHRISTOPHER NACE, Paulson & Nace PLLC, Washing-
ton, DC, argued for plaintiff-appellant.

   MEAGHAN KENT, Venable LLP, Washington, DC,
argued for defendants-appellees. Also represented by
STEVEN JAMES SCHWARZ, CLAIRE MARIE WHEELER.
               ______________________

    Before REYNA, WALLACH, and STOLL, Circuit Judges.
REYNA, Circuit Judge.
2         DISC DISEASE SOLUTIONS INC.   v. VGH SOLUTIONS, INC.

    Disc Disease Solutions Inc. appeals an order from the
United States District Court for the Middle District of
Georgia that dismissed with prejudice its complaint for
failure to state a claim and denied its request to file a first
amended complaint. The district court erred when it
dismissed the complaint for failure to state a claim. We
reverse the district court’s grant of the motion to dismiss
and remand for further proceedings.
                        BACKGROUND
    This appeal involves U.S. Patent No. 8,012,113 (“’113
patent”), entitled “Spinal Brace,” and U.S. Patent No.
7,618,509 (“’509 patent”), entitled “Wrinkled Band With-
out Air Expansion Tube and its Manufacturing Method.”
The ’113 patent is directed to an air injectable band with
a rigid panel worn around the waist. When the band is
inflated it expands vertically to provide traction to the
spine of the user to relieve back pain. The ’113 patent
consists of three independent claims. Claim 1 recites:
    1. A spinal brace comprising:
    a flexible air injectable band configured to be dis-
    posed about a torso of a user and to provide trac-
    tion to a spine of the user;
    a support panel configured to provide support by
    compression to at least a region of said torso, said
    support panel being less flexible than said air in-
    jectable band; and
    means of associating said support panel with said
    flexible air injectable band;
    wherein the air injectable band is configured to
    expand in an axis generally parallel to the spine
    when inflated so as to apply a force at a rib area of
    the user via an upper edge and a force at a hip ar-
    ea via a lower edge to provide said traction com-
DISC DISEASE SOLUTIONS INC.   v. VGH SOLUTIONS, INC.       3

    prising a decompression of vertebrae within the
    spinal column of the user; and
    wherein said means of associating comprise two
    association openings formed through the support
    panel, one association opening disposed at each of
    substantially opposite ends of said support panel,
    the air injectable band extending through the as-
    sociation openings, wherein the association open-
    ings traverse across the support panel in a
    direction generally parallel to the spine and
    wherein said association openings have a dimen-
    sion in said direction that is greater than a corre-
    sponding dimension of the flexible air injectable
    band.
’113 patent, col. 5 ll. 12–36.
    The ’509 patent is directed to a method of manufac-
turing a wrinkled band by adhering an overlapped sheet
creating an inner space and adhering a stretched elastic
band above and below the inner space. The ’509 patent
consists of one independent claim, which recites:
    1. A method of manufacturing a wrinkled band,
    wherein the outer peripheral rim of an overlapped
    adhesion sheet is adhered and simultaneously an
    adhesion line having an air passage is formed
    with certain regularity in the inner side face
    thereof, another adhesion line forms a respective
    vent hole and secures an inner space in-between,
    and above and below the secured inner space a
    connection adhesion band 5 with an elastic
    band 6 connected thereto is adhered by an outer
    peripheral line, with the elastic band being
    stretched.
’509 patent, col. 4 ll. 59–67.
   Appellees, VGH Solutions, Inc., Dr-Ho’s, Inc., and Dr.
Hoi Ming Michael Ho (collectively “VGH Solutions”)
4         DISC DISEASE SOLUTIONS INC.   v. VGH SOLUTIONS, INC.

manufacture and sell three inflatable spinal brace prod-
ucts: DBB 3500, 2-in-1 Back Relief Belt, and DBB 3000.
    On November 30, 2015, Disc Disease Solutions Inc.
(“Disc Disease”) filed a complaint for patent infringement
alleging that VGH Solutions’ products infringe the ’113
and ’509 patents. The complaint specifically identified
VGH Solutions’ products and alleged that the products
meet “each and every element of at least one claim of the
’113 [or ’509] Patent, either literally or equivalently.” J.A.
54–55. Disc Disease attached to the complaint the assert-
ed patents and photographs of the accused products.
     The following day, on December 1, 2015, amendments
to the Federal Rules of Civil Procedure took effect, abro-
gating Rule 84 and Form 18. Supreme Court of the
United States, Order Regarding Amendments to the
Federal Rules of Civil Procedure (U.S. Apr. 29, 2015). 1
The Supreme Court’s abrogation order states that the
amendments “shall govern in all proceedings in civil cases
thereafter commenced and, insofar as just and practica-
ble, all proceedings then pending.” Id. Rule 84 provided
that “[t]he Forms in the Appendix suffice under these
rules and illustrate the simplicity and brevity that these
rules contemplate.” Fed. R. Civ. P. 84 (2007) (abrogated,
eff. Dec. 1, 2015). Form 18 in the Appendix of Forms
provided a form adequate to plead a direct infringement
patent claim. See In re Bill of Lading Transmission &
Processing Sys. Patent Litig., 681 F.3d 1323, 1334 (Fed.
Cir. 2012).
    On March 31, 2016, VGH Solutions filed a motion to
dismiss Disc Disease’s complaint pursuant to Federal
Rules of Civil Procedure 12(b)(2) and 12(b)(6). On No-

    1   The      order    can      be      found      at
https://www.supremecourt.gov/orders/courtorders/frcv15(u
pdate)_1823.pdf.
DISC DISEASE SOLUTIONS INC.   v. VGH SOLUTIONS, INC.     5

vember 2, 2016, the district court granted VGH Solutions’
12(b)(6) motion to dismiss with prejudice. 2 The district
court concluded that the December 1, 2015 abrogation of
Rule 84 and Form 18 applied to Disc Disease’s complaint
and that the “Iqbal/Twombly” standard articulated by
Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007), and
Ashcroft v. Iqbal, 556 U.S. 662 (2009), now applied. Disc
Disease Sols., Inc. v. VGH Sols., Inc., No. 1:15-CV-188
(LJA), 2016 WL 6561566, at *2 (M.D. Ga. Nov. 2, 2016).
The district court reasoned that the complaint did not
satisfy the Iqbal/Twombly plausibility pleading standard
and entered final judgment against Disc Disease.
     On November 16, 2016, Disc Disease filed a motion for
reconsideration on the basis that the abrogation of Form
18 constituted an intervening change in law. For relief,
Disc Disease requested that the district court allow it to
file a first amended complaint. Disc Disease attached to
its motion for reconsideration an amended complaint that
included a detailed infringement analysis. Subsequently,
Disc Disease filed a timely Rule 59(e) motion requesting
that the district court alter or amend its judgment to
allow Disc Disease to file a first amended complaint.
    On December 12, 2016, the district court denied Disc
Disease’s motion for reconsideration and motion to alter
or amend the judgment. The district court concluded that
the fact that the abrogation of Form 18 took effect one day
after the complaint was filed, does not constitute grounds

   2    The district court’s Rule 12(b)(6) dismissal order
was unclear whether the dismissal was with prejudice.
The district court later clarified that the dismissal was
with prejudice in its order denying Disc Disease’s motion
for reconsideration and motion to alter or amend the
judgment. Disc Disease Sols., Inc. v. VGH Sols., Inc.,
No. 1:15-CV-188 (LJA), 2016 WL 9240616, at *2 (M.D. Ga.
Dec. 12, 2016).
6         DISC DISEASE SOLUTIONS INC.   v. VGH SOLUTIONS, INC.

for reconsideration as an intervening change in law. Disc
Disease, 2016 WL 9240616, at *1. The district court held
that its dismissal with prejudice without allowing Disc
Disease to amend its complaint did not create a manifest
injustice sufficient to warrant reconsideration. Id. at *3.
The district court explained that because Disc Disease
requested leave to amend in a footnote in its opposition to
VGH Solutions’ motion to dismiss, instead of in a separate
motion compliant with the local rules and governing
precedent, the district court had discretion to deny the
request sub silentio. Id. at *2. Relying on Wagner v.
Daewoo Heavy Indus. Am. Corp., 314 F.3d 541, 542–43
(11th Cir. 2002) (en banc), the district court reasoned that
it “is not required to grant a plaintiff leave to amend his
complaint sua sponte when the plaintiff, who is repre-
sented by counsel, never filed a motion to amend nor
requested leave to amend before the district court.” Disc
Disease, 2016 WL 9240616, at *2 (quoting Wagner, 314
F.3d at 542).
   Disc Disease appeals.      We have jurisdiction under
28 U.S.C. § 1295(a).
                       DISCUSSION
    We review procedural issues, including the grant of a
motion to dismiss, according to the law of the respective
regional circuit, in this case the Eleventh Circuit. Cleve-
land Clinic Found. v. True Health Diagnostics LLC, 859
F.3d 1352, 1359 (Fed. Cir. 2017). In the Eleventh Circuit,
a district court’s dismissal for failure to state a claim is
reviewed de novo. Mitchell v. Farcass, 112 F.3d 1483,
1490 (11th Cir. 1997).
   Disc Disease argues that the district court improperly
applied the Iqbal/Twombly pleading standard because
Form 18 was in effect on the date the original complaint
DISC DISEASE SOLUTIONS INC.   v. VGH SOLUTIONS, INC.      7

was filed. 3 Disc Disease contends that Iqbal/Twombly is
a “heightened” pleading standard compared to the re-
quirements of Form 18, and that its complaint was suffi-
cient to comply with Form 18.
    Under Iqbal/Twombly, Disc Disease was required to
“state a claim to relief that is plausible on its face.”
Twombly, 550 U.S. at 570. This plausibility standard is
met when “the plaintiff pleads factual content that allows
the court to draw the reasonable inference that the de-
fendant is liable for the misconduct alleged.” Iqbal, 556
U.S. at 678 (citing Twombly, 550 U.S. at 556). “Specific
facts are not necessary; the statement need only ‘give the
defendant fair notice of what the . . . claim is and the
ground upon which it rests.’” Erickson v. Pardus, 551
U.S. 89, 93 (2007) (alteration in original) (internal quota-
tion marks omitted) (quoting Twombly, 550 U.S. at 555).
    The district court determined that Disc Disease failed
to “explain how Defendants’ products infringe on any of
Plaintiff’s claims” because it “merely alleges that certain
of Defendants’ products ‘meet each and every element of
at least one claim’ of Plaintiff’s patents.” Disc Disease,
2016 WL 6561566, at *3. We disagree. Disc Disease’s

   3    We do not address the question of whether the
Form 18 or the Iqbal/Twombly pleading standard applies
in this case as we conclude that Disc Disease’s claims of
patent infringement were sufficiently pleaded under the
latter. See Lifetime Indus., Inc. v. Trim-Lok, Inc., 869
F.3d 1372, 1377 (Fed. Cir. 2017) (“The parties assume
that there is a difference between the requirements of
Form 18 and Iqbal/Twombly; however, we have never
recognized such a distinction. In any event, we need not
resolve the question whether there is a difference between
the two standards here because, as we explain, the [com-
plaint] met the Iqbal/Twombly standard.” (citation omit-
ted).
8         DISC DISEASE SOLUTIONS INC.   v. VGH SOLUTIONS, INC.

allegations are sufficient under the plausibility standard
of Iqbal/Twombly. This case involves a simple technolo-
gy. The asserted patents, which were attached to the
complaint, consist of only four independent claims. The
complaint specifically identified the three accused prod-
ucts—by name and by attaching photos of the product
packaging as exhibits—and alleged that the accused
products meet “each and every element of at least one
claim of the ’113 [or ’509] Patent, either literally or equiv-
alently.” J.A. 54–55. These disclosures and allegations
are enough to provide VGH Solutions fair notice of in-
fringement of the asserted patents. The district court,
therefore, erred in dismissing Disc Disease’s complaint for
failure to state a claim.
                        CONCLUSION
    We reverse the district court’s dismissal under Rule
12(b)(6) and remand for further proceedings consistent
with this opinion. Accordingly, we do not reach the re-
maining issues raised by the parties.
            REVERSED AND REMANDED
                           COSTS
    No costs.