Case 5:20-cv-05676-EJD Document 42 Filed 12/07/20 Page 1 of 30
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`YAR R. CHAIKOVSKY (SB# 175421)
`yarchaikovsky@paulhastings.com
`PHILIP OU (SB# 259896)
`philipou@paulhastings.com
`ANDY LEGOLVAN (SB# 292520)
`andylegolvan@paulhastings.com
`JOSEPH J. RUMPLER, II (SB# 296941)
`josephrumpler@paulhastings.com
`BERKELEY FIFE (SB# 325293)
`berkeleyfife@paulhastings.com
`BORIS LUBARSKY (SB# 324896)
`borislubarsky@paulhastings.com
`PAUL HASTINGS LLP
`1117 S. California Avenue
`Palo Alto, California 94304-1106
`Telephone: 1(650) 320-1800
`Facsimile: 1(650) 320-1900
`Attorneys for Plaintiff
`APPLIED MATERIALS, INC.
`
`
`UNITED STATES DISTRICT COURT
`NORTHERN DISTRICT OF CALIFORNIA
`
`APPLIED MATERIALS, INC.,
`Plaintiff,
`
`vs.
`DEMARAY LLC,
`Defendant.
`
`
`
`CASE NO. 5:20-cv-05676-EJD
`APPLIED MATERIALS, INC.’S
`OPPOSITION TO DEMARAY LLC’S
`MOTION TO DISMISS
`
`Hearing Date: March 4, 2021
`Hearing Time: 9:00 a.m.
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`APPLIED’S OPPOSITION TO
`DEMARAY’S MOTION TO DISMISS
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`Case 5:20-cv-05676-EJD Document 42 Filed 12/07/20 Page 2 of 30
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`TABLE OF CONTENTS
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`Page
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`I.
`II.
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`III.
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`B.
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`C.
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`D.
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`B.
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`C.
`D.
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`E.
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`INTRODUCTION .............................................................................................................. 1 
`BACKGROUND ................................................................................................................ 3 
`A.
`Demaray’s Customer-Suit Complaints Rely Exclusively on Applied’s
`Reactors and Product Materials to Support Infringement Allegations ................... 3 
`Demaray’s Customer Suits Created a Reasonable Apprehension of Suit
`Against Applied ...................................................................................................... 5 
`Applied’s Declaratory Judgment Action Asserting Non-Infringement based
`on License ............................................................................................................... 7 
`Applied’s Declaratory Judgment Action Asserting Non-Infringement based
`on Assignment Provisions ....................................................................................... 9 
`ARGUMENT ...................................................................................................................... 9 
`A.
`The Court Has Subject Matter Jurisdiction Over Applied’s Claims ....................... 9 
`1.
`Demaray Asserts a Factual Challenge to Jurisdiction Under Rule
`12(b)(1)—Thus Requiring Introduction of Extrinsic Evidence .................. 9 
`Standard for Assessing Article III “Case or Controversy” ....................... 10 
`Demaray’s Customer Suits Establish a Reasonable Potential It
`Could Bring Direct Infringement Claims Against Applied ...................... 11 
`Demaray’s Customers Suits Also Establish a Reasonable Potential
`It Could Bring Inducement and Contributory Claims Against
`Applied ...................................................................................................... 14 
`Demaray’s Offer to License and Refusal to Covenant Not to Suit
`Applied Further Weighs in Favor of Finding a Controversy .................... 15 
`Enjoining the Customer Suits under the Customer-Suit Rule is the Most
`Efficient and Convenient Way to Resolve All Actions ........................................ 16 
`Demaray’s Motion Under Rule 12(b)(6) Should Be Denied ................................ 18 
`Applied has Pleaded Sufficient Facts for a Plausible Claim for Relief Based
`on License ............................................................................................................. 19 
`Applied has Pleaded Sufficient Facts for a Plausible Claim for Relief for
`Non-Infringement based on the Assignment Provisions ....................................... 21 
`1.
`A Finding of Non-Infringement based on the Assignment
`Provisions in this Action Would Not Restrain Trade or Employee
`Mobility ..................................................................................................... 22 
`Roche Confirmed that an Assignment Provision that, as Drafted,
`Could Reach Post-Termination Inventions Is Not Invalid as to Pre-
`Termination Inventions ............................................................................. 23 
`
`2.
`3.
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`4.
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`5.
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`2.
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`APPLIED’S OPPOSITION TO
`DEMARAY’S MOTION TO DISMISS
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`Case 5:20-cv-05676-EJD Document 42 Filed 12/07/20 Page 3 of 30
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`TABLE OF CONTENTS
`(continued)
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`Page
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`3.
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`There Is an Open Factual Question as to Whether the Named
`Inventors Conceived of the Invention During Employment and with
`Applied’s Confidential Information .......................................................... 25 
`CONCLUSION ................................................................................................................. 25 
`
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`IV.
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`APPLIED’S OPPOSITION TO
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`Case 5:20-cv-05676-EJD Document 42 Filed 12/07/20 Page 4 of 30
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`
`
`TABLE OF AUTHORITIES
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`
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`Page(s)
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`Cases
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`Applied Materials, Inc. v. Advanced Micro-Fabrication Equip. (Shanghai) Co.
`630 F. Supp. 2d 1084 (N.D. Cal. May 20, 2009) ......................................................................23
`
`Armorlite Lens Co. v. Campbell,
`340 F. Supp. 273 (S.D. Cal. 1972) ............................................................................................24
`
`Arris Group, Inc. v. British Telecomm. PLC,
`639 F.3d 1368 (Fed. Cir. 2011) ...........................................................................................13, 14
`
`Bal Seal Eng’g, Inc. v. Nelson Prods.,
`No. 8:13-cv-1880-JLS-KESx, 2016 U.S. Dist. LEXIS 195915 (C.D. Cal. Sep.
`8, 2016) .....................................................................................................................................15
`
`Bd. of Trs. of the Leland Stanford Junior Univ. v. Roche Molecular Sys.,
`583 F.3d 832 (Fed. Cir. 2009) .............................................................................................22, 24
`
`Bd. of Trs. v. Roche Molecular Sys.,
`487 F. Supp. 2d 1099 (N.D. Cal. 2007) ....................................................................................24
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`Demaray v. Intel,
`No. 6:20-cv-634, Dkt. No. 1-3 ..................................................................................................14
`
`DermaFocus LLC v. Ulthera, Inc.,
`201 F. Supp. 3d 465 (D. Del. 2016) ..........................................................................................14
`
`Dolby Labs., Inc. v. Intertrust Techs. Corp.,
`No. 19-cv-03371-EMC, 2019 U.S. Dist. LEXIS 194022 (N.D. Cal. Nov. 6,
`2019) .........................................................................................................................................13
`
`Edison v. United States,
`822 F.3d 510 (9th Cir. 2016) .....................................................................................................10
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`Hoffmann-La Roche Inc. v. Promega Corp.,
`No. C-93-1748, 1994 U.S. Dist. LEXIS 10174 (N.D. Cal. June 13, 1994) ..............................15
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`Kanbar v. O’Melveny & Myers,
`849 F. Supp. 2d 902 (N.D. Cal. 2011) ................................................................................18, 19
`
`Mass Eng. Des., Inc. v. Planar Sys.,
`426 F. Supp. 3d 680 (D. Or. 2019) ...........................................................................................15
`
`Max Sound Corp. v. Google, Inc.,
`147 F. Supp. 3d 948 (N.D. Cal. 2015) ................................................................................10, 13
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`APPLIED’S OPPOSITION TO
`DEMARAY’S MOTION TO DISMISS
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`Case 5:20-cv-05676-EJD Document 42 Filed 12/07/20 Page 5 of 30
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`MedImmune, Inc. v. Genentech, Inc.,
`549 U.S. 118 (2007) ..................................................................................................................10
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`Microsoft Corp. v. DataTern, Inc.,
`755 F.3d 899 (Fed. Cir. 2014) .......................................................................................11, 13, 14
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`Prasco, LLC v. Medicis Pharm. Corp.,
`537 F.3d 1329 (Fed. Cir. 2008) .................................................................................................13
`
`Pratt v. Whole Foods Mkt. Cal., Inc.,
`No. 5:12-cv-05652-EJD, 2014 U.S. Dist. LEXIS 46409 (N.D. Cal. Mar. 31,
`2014) .........................................................................................................................................10
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`Retail Prop. Trust v. United Bhd. of Carpenters & Joiners of Am.,
`768 F.3d 938 (9th Cir. 2014) .....................................................................................................19
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`Safe Air For Everyone v. Meyer,
`373 F.3d 1035 (9th Cir. 2004) .....................................................................................................9
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`Valley View Health Care, Inc. v. Chapman,
`992 F. Supp. 2d 1016 (E.D. Cal. 2014) .....................................................................................18
`
`Whitewater W. Indus. v. Alleshouse,
`Nos. 2019-1852, 2019-2323, 2020 U.S. App. LEXIS 36394 (Fed. Cir. Nov. 19,
`2020) ................................................................................................................................. passim
`
`Other Authorities
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`Fed. R. Civ. P. 12(b)(1) ...............................................................................................................9, 10
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`Fed. R. Civ. P. 12(b)(6) ..................................................................................................................18
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`APPLIED’S OPPOSITION TO
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`Case 5:20-cv-05676-EJD Document 42 Filed 12/07/20 Page 6 of 30
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`I.
`
`INTRODUCTION
`Demaray challenges this Court’s jurisdiction by arguing that its infringement suits against
`Applied’s customers—which rely exclusively on Applied’s products, materials, website, and
`literature—are somehow not directed at Applied’s products and technology. Demaray’s strained
`arguments, first raised in response to Applied’s motion to enjoin Demaray from proceeding in its
`suits against Applied’s customers in the Western District of Texas, were rebutted in reply, including
`with sworn declarations from Applied, Intel, and Samsung. Undeterred, Demaray attempts to thread
`this needle again by contending in its motion that Intel and Samsung modify Applied’s reactors
`after Applied manufactures and installs them into an allegedly infringing “configuration” such that
`the customer suits did not impliedly assert infringement against Applied. But nowhere in the
`customer complaints does Demaray even allege that such post-installation modifications take place,
`nor does Demaray produce evidence for its theory.
`The Applied reactors identified and accused in the customer suits are built by Applied to
`meet the customers’ specific requirements and thereafter installed by Applied at the customers’
`fabrication facilities. Accordingly, when considering the allegations in the customer complaints in
`view of Applied’s commercial relationship with it customers, there is a reasonable potential that
`Demaray could bring a claim of infringement against Applied based on the same allegations against
`Intel and Samsung. Samsung and Intel have denied that their use of Applied’s reactors infringe,
`and likewise, Applied seeks declaratory judgment that it, and its reactors, do not infringe. There is
`no basis to challenge this Court’s jurisdiction over Applied’s claims.
`Likewise, Demaray’s 12(b)(6) challenges to the non-infringement claims based on license
`or assignments should be denied, in particular where disputed facts are viewed in the light most
`favorable to the nonmoving party. First, Applied has pleaded that it cannot infringe because the
`Asserted Patents were licensed as part of a Sales and Relationship Agreement between two
`sophisticated commercial entities. Demaray overreaches by arguing that this commercial contract
`is invalid based on § 16600 and that Applied is estopped from arguing otherwise based on the
`Advanced opinion. Demaray is wrong on both. Advanced never addressed this commercial contract,
`let alone the assignment provisions that the parties were aware of and considered as part of their
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`APPLIED’S OPPOSITION TO
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`negotiations that led to the agreement. Nor does the holding in Advance address the specific facts
`and issues in this case, where the Federal Circuit has confirmed in both Whitewater and Roche that
`an essential threshold question under § 16600 is whether there is “evidence of a restraining effect
`on [a former employee’s] ability to engage in his profession.” Demaray does not argue that there
`has been a restraining effect on Dr. Demaray or any other former employees’ ability to engage in
`their profession—because there is none.
`For this reason, § 16600 does not apply to Applied’s non-infringement claims based on the
`assignment provisions of one or more the named inventors either. Unlike in Advanced or
`Whitewater, Applied is not seeking to enjoin former employees from competing with Applied, nor
`is Applied seeking ownership rights in the Asserted Patents; rather Applied is only seeking a
`declaration that it does not infringe for two independent and distinct reasons: (1) Demaray’s
`predecessor entity granted Applied a license, restricted in scope, that covers the Asserted Patents
`as part of a commercial contract; and separately (2) Demaray cannot establish ownership over the
`ownership interest of at least one named inventor. While Demaray may disagree on the merits, it
`has no basis to argue that Applied has failed to plead a plausible claim for relief that Applied does
`not infringe for these additional reasons. Demaray’s transparent attempt to delay this case from
`proceeding, while its suits against Applied’s customers where the same defenses have been raised,
`should be denied.1
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`
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`1 Demaray’s inconsistent conduct in the customer suits regarding the same license and assignment
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`arguments, raised as affirmative defenses, is telling. Shortly after Intel and Samsung answered
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`Demaray demanded, relying on Advanced, that they provide “other support for these defenses” in
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`an amended pleadings or withdraw them, or otherwise “be prepared to meet and confer regarding
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`a motion to strike.” Exs. A, B. The customers amended their affirmative defenses to add the same
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`factual allegations as set forth in Applied’s FAC, which Demaray presumably recognized as
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`sufficient at the pleading stage as no motion to strike followed. Exs. C, D.
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`APPLIED’S OPPOSITION TO
`DEMARAY’S MOTION TO DISMISS
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`Case 5:20-cv-05676-EJD Document 42 Filed 12/07/20 Page 8 of 30
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`II.
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`BACKGROUND
`A.
`Demaray’s Customer-Suit Complaints Rely Exclusively on Applied’s
`Reactors and Product Materials to Support Infringement Allegations
`Demaray filed two actions in the Western District of Texas (“WDTX”) against Applied’s
`customers—Intel and Samsung—accusing them of infringing U.S. Patent Nos. 7,544,276 and
`7,381,657 (the “Asserted Patents”) by using Applied’s reactors. See Exs. A and B to Applied’s First
`Amended Complaint (“FAC”). Specifically, Demaray accuses Applied’s customers of infringing
`the Asserted Patents by using “RMS reactors” in the “Endura product line from Applied Materials,
`Inc.” to deposit layers into certain semiconductor products. Ex. A to FAC at ¶ 25; Ex. B to FAC
`at ¶ 28. To support its claims for infringement, Demaray relies exclusively on Applied’s products,
`materials, literature, and website. See Ex. A to FAC at ¶ 25 (screenshot of Applied’s Endura reactor
`from Applied’s website and citing to various Applied product materials, including an Endura
`reactor brochure, a journal article written by Applied employees regarding TaN deposition
`chambers, and an Applied presentation on TiN deposition chambers); see also id. at ¶¶ 28, 29, 31,
`32, 34, 35, 37, 38, 52, 53, 55, 56, 62, 63, 65, 67; Ex. B to FAC at ¶¶ 28, 31, 32, 34, 35, 37, 38, 40,
`41, 54, 55, 57, 58, 61, 62, 64, 65, 67, 69. Indeed, every image in the customer complaints are of
`Applied’s reactors or components thereof, or are images of diagrams and schematics of Applied’s
`reactors and/or are from Applied’s website or product materials.
`While Demaray’s customer-suit complaints make vague allegations of “configurations” to
`Applied’s reactors, those allegations are asserted solely “on information and belief” and either rely
`exclusively on evidence from Applied (as opposed to Samsung or Intel) or on no evidence
`whatsoever. See, e.g., Ex. A to FAC at ¶¶ 33, 36, 39; Ex. B to FAC at ¶¶ 36, 39, 42 (“On information
`and belief, [Intel/Samsung] configures, or causes to be configured . . . .”). Demaray makes these
`“configuration” allegations as to three power supply-related limitations: (1) the “pulsed DC power
`supply coupled to the target,” (2) “an RF bias power supply coupled to the substrate,” and (3) “a
`narrow band-rejection filter that rejects at a frequency of the RF bias power supply coupled between
`the pulsed DC power supply and the target area.” Id.
`Regarding the first limitation—“pulsed DC power supply coupled to the target”—Demaray
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`APPLIED’S OPPOSITION TO
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`Case 5:20-cv-05676-EJD Document 42 Filed 12/07/20 Page 9 of 30
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`relies exclusively on (1) schematics from Applied’s product literature, Ex. A to FAC at ¶¶ 34, 35
`(first image); Ex. B to FAC at ¶¶ 37, 38 (first image), and (2) an image of an Applied Endura
`reactor, Ex. A to FAC at ¶ 35 (second image); Ex. B to FAC at ¶ 38 (second image).2 Regarding
`the second limitation—“an RF bias power supply coupled to the substrate”—again, Demaray relies
`exclusively on (1) a schematic from Applied’s product literature, Ex. A to FAC at ¶ 37; Ex. B to
`FAC at ¶ 40, and (2) two images of Applied’s reactors.3 Thus, Demaray’s conclusory allegations
`in its motion that these two power supplies limitations are somehow “configured” by Intel and
`Samsung are belied by the fact that Demaray relies on Applied’s products and Applied’s product
`materials—not Intel’s or Samsung’s—to support its infringement allegations. Indeed, nowhere in
`the complaints does Demaray expressly allege that Intel or Samsung takes the Endura reactors,
`admittedly supplied from Applied, and then replaces either or both power supply with their own.
`The more reasonable interpretation of Demaray’s allegations, based on its citation to literature and
`images of Applied’s reactors, is that Applied provides the power supplies with the reactors that
`Applied builds and configures for its customers to meet their specific specification requirements
`(i.e., Intel/Samsung “causes to be configured”).
`Finally, regarding the third limitation—the “narrow band-rejection filter”—Demaray
`
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`2 Demaray did not provide a citation for where it acquired the Endura reactor image at this
`paragraph; however, a reverse-image search on Google reveals that it came from a third-party
`website selling a preowned Applied Endura reactor. See https://caeonline.com/buy/reactors/amat-
`applied-materials-endura-ii/9090977.
`3 One of which prominently displays the “Applied Materials” logo in blue next to the red arrow
`signaling where the “RF power connection to the substrate” is located, Ex. A to FAC at ¶ 38; Ex.
`B to FAC at ¶ 41. For the other image in this paragraph, Demaray did not provide a citation for
`where the image was acquired; however, a reverse-image search on Google reveals that it came
`from a press release on Applied’s website relating to Applied’s Endura system. See
`https://www.appliedmaterials.com/company/news/press-releases/2015/05/applied-materials-
`breakthrough-patterning-hardmask-enables-copper-interconnect-scaling.
`APPLIED’S OPPOSITION TO
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`DEMARAY’S MOTION TO DISMISS
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`Case 5:20-cv-05676-EJD Document 42 Filed 12/07/20 Page 10 of 30
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`provides no citation to any evidence whatsoever. Ex. A to FAC at ¶ 40 (“On information and belief,
`a narrowband filter is used in the Intel RMS reactors as configured to . . . protect the pulsed DC
`power supply from feedback from the RF bias power supply”); Ex. B to FAC at ¶ 40; see also Dkt.
`No. 23 at 4 (“The narrow band rejection filter allows the power sources to properly function, but
`prevents damaging feedback to the pulsed DC power source from the RF bias.”); see also Mot. at
`5. In addition to Demaray’s failure to provide any factual or evidentiary support that Intel or
`Samsung “configures” Applied’s reactors to add this filter to Applied’s reactors, these same
`arguments were already rebutted in Applied’s reply brief in support of its injunction motion. See
`Dkt. No. 26-12 at ¶¶ 15–16; Dkt. No. 26-8 at ¶¶ 10–11; Dkt. No. 26-10 at ¶ 12.
`
`B.
`
`Demaray’s Customer Suits Created a Reasonable Apprehension of Suit
`Against Applied
`Upon reviewing Demaray’s customer suits against Intel and Samsung, Applied immediately
`recognized that Demaray was, in effect, implicitly asserting infringement allegations against
`Applied and Applied’s reactors. See Forster Decl. ¶¶ 2–10. This is because customers like Intel and
`Samsung typically provide Applied with a set of specifications for a type of film they would like
`to deposit, and based on those specifications, Applied manufactures the RMS reactors to deposit
`films according to the customers’ specifications. Id. at ¶ 6. The Endura system, and systems like it,
`are not simply purchased “off the shelf,” but rather are manufactured by Applied to meet the
`specifications requested by Intel and Samsung. Id. at ¶ 5. Performing post-installation
`modifications—such as modifying the power supply or adding an additional component, e.g. a
`filter— to the system as installed by Applied, could cause the reactor to no longer meet the
`customers’ required specifications or impact its warranty. Id at ¶ 6.
`At the time Applied filed its declaratory judgment complaint, Applied reasonably
`interpreted Demaray’s allegations in the customer complaints as implied assertions of infringement
`against Applied. Notably, Demaray’s motion entirely ignores that Applied manufactures,
`assembles, and installs the accused Endura reactor systems at Intel’s and Samsung’s respective
`fabrication facilities; which requires a complex precision and planning process between Applied
`and its respective customer. If Demaray was not aware of this process before it sued Intel and
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`APPLIED’S OPPOSITION TO
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`Case 5:20-cv-05676-EJD Document 42 Filed 12/07/20 Page 11 of 30
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`Samsung,4 Demaray was certainly aware of before it filed the instant motion. See Dkt. Nos. 28-6–
`12. Demaray, nevertheless, disregards this reality in bringing its motion.
`Demaray does not allege (or substantiate in any way) that, after Applied manufactured and
`installed its systems, Intel or Samsung subsequently—on their own—perform unauthorized post-
`installation hardware modifications, such as switching out a continuous DC power supply for a
`pulsed DC power supply. Applied is not aware of any of its customers performing such
`configurations. Forster Decl. ¶ 6. This strained and illogical theory, first introduced in this motion,
`was not pleaded, or substantiated, in the customer-suit complaints.
`In sum, based on the allegations in Demaray’s customer complaints and the reality of
`Applied’s commercial relationships with its customers, Applied immediately recognized that,
`despite any conclusory allegations that Intel and Samsung purportedly “configures, or causes to be
`configured” the reactors, Demaray was effectively accusing Applied and Applied’s reactors of
`infringing the Asserted Patents. See Forster Decl. at ¶¶ 9–10. Because Demaray’s customer suits
`against Intel and Samsung implicitly accused Applied of infringement, Applied promptly filed the
`instant action for a judgment declaring that Applied does not directly or indirectly infringe the
`Asserted Patents. See Dkt. No. 1 at ¶¶ 16–18, 21–23; Dkt. No. 13 at ¶¶ 45–52.
`In October 2020, Demaray served its Preliminary Infringement Contentions in the customer
`suits against Intel and Samsung. Demaray has maintained that the contentions, including even its
`selection of dependent claims to assert, are confidential and refused to produce them to Applied. A
`“public” version that is limited to claim 1 of each Asserted Patent has since been made available
`(see Exs. E and F), which further confirm what Applied reasonably, believed based on Demaray’s
`customer-suit complaints, that: Demaray’s infringement actions were, in reality, accusing Applied
`and Applied’s reactors of infringing the Asserted Patents. Specifically, Demaray cites exclusively
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`4 Any purported ignorance by Demaray about how a supplier like Applied would build, configure,
`and install PVD reactors for its customers is not credible considering Dr. Demaray’s “more than
`fifty years” working in the semiconductor industry, including previously as General Manager of
`Applied Komatsu’s PVD division. Dkt. No. 23-1 at ¶¶ 2, 4.
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`APPLIED’S OPPOSITION TO
`DEMARAY’S MOTION TO DISMISS
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`Case 5:20-cv-05676-EJD Document 42 Filed 12/07/20 Page 12 of 30
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`to Applied’s reactors and Applied’s product materials to support infringement contentions. Indeed,
`every image, diagram, and schematic for the infringement contentions of claim 1 of the ’276 patent
`is of Applied’s products and/or come from Applied’s product materials. Those contentions, like the
`customer complaints, are devoid of any allegations that the customers make post-installment
`hardware modifications to the accused reactors supplied by Applied.5 As with the allegations in
`the customer-suit complaints, Demaray’s allegations are belied by the fact that Demaray
`consistently and repeatedly cites to Applied’s products and Applied’s product materials—not Intel
`or Samsung’s—to support infringement contentions. Id.
`
`C.
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`Applied’s Declaratory Judgment Action Asserting Non-Infringement based
`on License
`After Applied filed its initial Complaint for declaratory relief, Applied filed a First
`Amended Complaint to add an additional non-infringement claim based on a license. Specifically,
`Applied seeks a declaratory judgment that it does not infringe because Applied holds a license to
`the Asserted Patents based on an agreement between Applied’s affiliate (Applied Komatsu) and
`Demaray’s predecessor company (Symmorphix). FAC at ¶¶ 53–64.
`In 1998, Dr. Demaray, along with several colleagues from Applied and Applied Komatsu,
`left to form a new company: Symmorphix. The former employees would continue working on the
`
`5 Demaray continues to contradict its statements and arguments made to this Court through its
`conduct in the customer suits. In support of its motion, Demaray argued “[t]here is no allegation
`in the Texas complaints that the Demaray patents cover all PVD reactor configurations” Mot. at 5
`citing to Dr. Demaray’s declaration at ¶ 12. Demaray has repeatedly stressed its allegations are
`directed to “specific configurations”. Id at 2; see also Dkt. No. 23 at 4:22–5:3 and 6:4–9; Dkt.
`No. 40 at 5:10–23. In turn, Demaray previously agreed to narrow the scope of requested venue
`discovery in the customer suits from “all RMS-PVD reactors” to only ones having the “specific
`configuration” of providing (1) pulsed DC power to the target and (2) RF bias to substrate, as
`required by the Asserted Patents. Ex. I. Yet on Dec. 7, Demaray reversed course, serving venue
`discovery requests that seek information on all RMS-PVD reactors, not limited by any “specific
`configuration” whatsoever. Exs. J at 2, K at 2 (defining Samsung/Intel RMS-PVD chamber).
`APPLIED’S OPPOSITION TO
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`DEMARAY’S MOTION TO DISMISS
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`same technology they worked on at Applied and Applied Komatsu, including sputtered silicon
`deposition technology. Id. at ¶¶ 15–16. In support of the former employees’ continued work in this
`area, Applied Komatsu and Symmorphix executed a Sale and Relationship Agreement (“SRA”) on
`December 11, 1998, under which Symmorphix would continue using Applied Komatsu facilities
`and purchase two Applied Komatsu systems. Pursuant to the SRA, Symmorphix continued using
`the Applied Komatsu facilities and equipment until at least the Fall of 1999. Ex. G at 14–15. As
`part of the SRA, Symmorphix granted Applied a license to “any rights of Symmorphix under any
`patents issued based on any patent applications filed before January 1, 2001, for inventions,
`improvements, or enhancements developed by Symmorphix relating to sputtered silicon deposition
`technology, provided that AKTA shall not utilize such rights to pursue the same product objectives
`concerning flat panel displays as Symmorphix.” Ex. G at 9. Dr. Demaray admitted that “[a]s part
`of the agreement, Applied Komatsu agreed to release me and the other former employees joining
`Symmorphix from assignment provisions in certain employment agreements.” Dkt. No. 23-1 at ¶
`6. The release provision (paragraph 4 of Exhibit C) follows the “License Grants” set forth in Exhibit
`C of the SRA. See Ex. G at 9.
`In early 1999, Symmorphix contacted Applied Komatsu to renegotiate the license provision
`in the SRA. Ex. H. Specifically, Symmorphix expressed concern that the license provision “may
`allow [Applied Komatsu] . . . to compete with Symmorphix.” Id. at 1. At Symmorphix’s behest,
`Applied Komatsu renegotiated the license provision and on January 29, 1999, entered into an
`amendment to the SRA. The parties agreed that, “provided that [Applied Komatsu] shall not utilize
`such rights to pursue a business of providing [sputtering silicon deposition services],” Symmorphix
`grants Applied Komatsu a perpetual, royalty-free license to “inventions, improvements, or
`enhancements developed by Symmorphix relating to sputtered silicon deposition technology”—the
`technology embodied in the Asserted Patents. Ex. G at 11. The amendment to the license grant of
`the SRA broadened the non-compete condition to “provided that AKTA shall not utilize such rights
`to pursue a business of providing Services” where “Services” is defined as “providing sputtered
`silicon deposition services.” Id. The amendment also removed the temporal limitation of “before
`January 1, 2001,” but limited the grant to inventions conceived of by former Applied or Applied
`APPLIED’S OPPOSITION TO
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`DEMARAY’S MOTION TO DISMISS
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`Case 5:20-cv-05676-EJD Document 42 Filed 12/07/20 Page 14 of 30
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`Komatsu personnel who subsequently joined Symmorphix, such as Dr. Demaray, as opposed to
`any Symmorphix employee.
`Symmorphix and Applied Komatsu were two sophisticated commercial entities that
`negotiated an arms’ length comm