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`Case 5:20-cv-09341-EJD Document 174 Filed 08/11/22 Page 1 of 34
`
`IRELL & MANELLA LLP
`Morgan Chu (70446)
`MChu@irell.com
`Benjamin W. Hattenbach (186455)
`BHattenbach@irell.com
`Samuel K. Lu (171969)
`SLu@irell.com
`Olivia L. Weber (319918)
`OWeber@irell.com
`1800 Avenue of the Stars, Suite 900
`Los Angeles, California 90067-4276
`Telephone: (310) 277-1010
`Facsimile:
`(310) 203-7199
`
`FOLIO LAW GROUP PLLC
`C. Maclain Wells (221609)
`Maclain@foliolaw.com
`2376 Pacific Ave.
`San Francisco, CA 94115
`(415) 562-8632
`
`Attorneys for Defendant
`DEMARAY LLC
`
`UNITED STATES DISTRICT COURT
`
`NORTHERN DISTRICT OF CALIFORNIA
`
`SAN JOSE DIVISION
`
`APPLIED MATERIALS, INC.,
`
`
`Plaintiff,
`
`
`
`
`DEMARAY LLC,
`
`
`vs.
`
`Defendant.
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`
`11130651
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`)
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`)
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`Case No. 5:20-cv-09341-EJD
`
`DEFENDANT DEMARAY LLC'S
`AMENDED ANSWER, AFFIRMATIVE
`DEFENSES, AND COUNTERCLAIMS TO
`COMPLAINT
`
`
`DEMAND FOR JURY TRIAL
`
`
`
`
`DEMARAY LLC'S AMENDED ANSWER AND
`COUNTERCLAIMS
`(Case No. 5:20-cv-09341-EJD)
`
`

`

`Case 5:20-cv-09341-EJD Document 174 Filed 08/11/22 Page 2 of 34
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`Defendant Demaray LLC ("Demaray"), by its undersigned counsel, hereby submits its
`
`Amended Answer and Counterclaims to plaintiff Applied Materials, Inc.'s ("Applied") Complaint
`
`for Declaratory Judgment. Solely for convenience, the headings from the Complaint are
`
`reproduced here. To the extent not specifically admitted herein, the allegations of the Complaint
`
`are denied.
`
`NATURE OF THE ACTION
`
`1.
`
`Demaray admits that Applied has filed this lawsuit purporting to seek a declaratory
`
`judgment. Demaray admits that it filed lawsuits against Intel and Samsung alleging infringement of
`
`U.S. Patent Nos. 7,544,276 (the "'276 Patent") and 7,381,657 (the "'657 Patent") on July 14, 2020.
`
`Demaray admits that what appears to be copies of its complaints against Intel and Samsung are
`
`attached as Exhibit A and B to the Complaint. This paragraph contains legal conclusions to which
`
`no response is required. Demaray denies any remaining allegations in this paragraph.
`
`2.
`
`Demaray admits that the '276 and '657 Patents are titled "Biased Pulse DC Reactive
`
`Sputtering of Oxide films" and share a common specification. Demaray admits that the '276 Patent
`
`is directed toward apparatus claims and that the '657 Patent is directed toward method claims. This
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`paragraph contains legal conclusions to which no response is required. Demaray is without
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`knowledge sufficient to admit or deny the remaining allegations in this paragraph and therefore
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`denies them.
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`3.
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`Demaray admits that John Forster purports to have been an Applied employee who
`
`submitted a declaration in Applied Materials, Inc. v. Demaray LLC, Case No. 5:20-cv-05676-EJD
`
`("Applied I"), a copy of which appears to be attached as Exhibit Q to the Complaint. Demaray
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`affirmatively states that Exhibit Q speaks for itself. This paragraph contains legal conclusions to
`
`which no response is required. Demaray denies any remaining allegations in this paragraph.
`
`4.
`
`Demaray admits that Dr. Ernest Demaray is a former employee of Applied Komatsu
`
`Technology, Inc. ("Applied Komatsu") and has decades of experience working with or in the
`
`semiconductor industry. Demaray admits that a copy of Dr. Demaray's declaration submitted in
`
`Applied I appears to be attached as Exhibit M to the Complaint. Demaray admits that Scot Griffin
`
`works as a consultant to Demaray and "has extensive knowledge about the semiconductor industry."
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`11130651
`
`
`- 1 -
`
`DEMARAY LLC'S AMENDED ANSWER AND
`COUNTERCLAIMS
`(Case No. 5:20-cv-009341-EJD)
`
`

`

`Case 5:20-cv-09341-EJD Document 174 Filed 08/11/22 Page 3 of 34
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`Demaray affirmatively states that Exhibits M and R speak for themselves. Demaray denies any
`
`remaining allegations in this paragraph.
`
`5.
`
`Demaray admits that Applied filed a purported declaratory judgment action of non-
`
`infringement in Applied I on August 13, 2020 and that Applied moved for a preliminary injunction
`
`on September 4, 2020. This paragraph contains legal conclusions to which no response is required.
`
`Demaray is without knowledge sufficient to admit or deny the remaining allegations in this
`
`paragraph and therefore denies them.
`
`6.
`
`Demaray admits that the excerpted text appears in its opposition to Applied's motion
`
`for preliminary injunction in Applied I. Demaray admits that in the Texas complaints it "did not
`
`accuse Applied PVD reactors standing alone of infringement in the Texas cases." This paragraph
`
`contains legal conclusions to which no response is required. Demaray denies any remaining
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`allegations in this paragraph.
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`7.
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`This paragraph contains legal conclusions to which no response is required. Demaray
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`denies any remaining allegations in this paragraph.
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`8.
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`This paragraph contains legal conclusions to which no response is required. Demaray
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`denies any remaining allegations in this paragraph.
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`9.
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`This paragraph contains legal conclusions to which no response is required. Demaray
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`denies any remaining allegations in this paragraph.
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`10.
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`Demaray admits that it served infringement contentions on October 9, 2020 in the
`
`Texas cases, copies of which appear to be attached as Exhibits C and D to the Complaint. This
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`paragraph contains legal conclusions to which no response is required. Demaray denies any
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`22
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`remaining allegations in this paragraph.
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`11.
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`Demaray admits that Applied submitted declarations in Applied I in alleged support
`
`of its motion for preliminary injunction. This paragraph contains legal conclusions to which no
`
`response is required. Demaray denies any remaining allegations in this paragraph.
`
`12.
`
`Demaray admits that it required, and still requires, discovery from Applied or other
`
`sources such as Applied suppliers to ascertain whether it will file additional compulsory
`
`counterclaims of infringement and that correspondence and conferences occurred regarding the
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`11130651
`
`
`- 2 -
`
`DEMARAY LLC'S AMENDED ANSWER AND
`COUNTERCLAIMS
`(Case No. 5:20-cv-09341-EJD)
`
`

`

`Case 5:20-cv-09341-EJD Document 174 Filed 08/11/22 Page 4 of 34
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`same. Demaray affirmatively states that Exhibit E of the Complaint speaks for itself. Demaray
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`denies any remaining allegations in this paragraph.
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`13.
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`Demaray admits that the excerpted text appears in the Joint Case Management
`
`Statement filed in Applied I. Demaray is without knowledge sufficient to admit or deny the
`
`remaining allegations in this paragraph and therefore denies them.
`
`14.
`
`Demaray admits that it served Applied with subpoenas in the Texas actions, copies
`
`of which appear to be attached as Exhibits F and G to the Complaint. Demaray denies any remaining
`
`allegations in this paragraph.
`
`15.
`
`Demaray admits that the excerpted text appears in correspondence to the Court in the
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`10
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`Texas action, a copy of which appears to be attached as Exhibit H to the Complaint. Demaray denies
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`11
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`any remaining allegations in this paragraph.
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`12
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`16.
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`This paragraph contains legal conclusions to which no response is required. Demaray
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`13
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`denies any remaining allegations in this paragraph.
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`14
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`17.
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`This paragraph contains legal conclusions to which no response is required. Demaray
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`denies any remaining allegations in this paragraph.
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`18.
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`Demaray admits that Dr. Demaray left Applied Komatsu and participated in forming
`
`Symmorphix, Inc. ("Symmorphix"), and that Symmorphix entered a Sales and Relationship
`
`Agreement ("SRA") with Applied Komatsu. Demaray affirmatively states that Exhibit I speaks for
`
`itself. Demaray denies any remaining allegations in this paragraph.
`
`19.
`
`Demaray affirmatively states that Exhibit J speaks for itself. Demaray denies any
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`remaining allegations in this paragraph.
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`20.
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`Demaray affirmatively states that Exhibit K speaks for itself. Demaray denies any
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`remaining allegations in this paragraph.
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`21.
`
`22.
`
`Denied.
`
`Demaray admits that Mukundan Narasimhan is one of the four named inventors on
`
`the '276 and '657 Patents and joined Symmorphix on April 16, 2001. Demaray denies any remaining
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`27
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`allegations in this paragraph.
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`28
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`11130651
`
`
`- 3 -
`
`DEMARAY LLC'S AMENDED ANSWER AND
`COUNTERCLAIMS
`(Case No. 5:20-cv-09341-EJD)
`
`

`

`Case 5:20-cv-09341-EJD Document 174 Filed 08/11/22 Page 5 of 34
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`23.
`
`Demaray admits that Applied purports to request declaratory relief as described in
`
`this paragraph.
`
`THE PARTIES
`
`24.
`
`Demaray admits that Applied asserts that it is a Delaware corporation with its
`
`principal place of business at 3050 Bowers Avenue, Santa Clara, CA 95054-3299. Demaray is
`
`without knowledge sufficient to admit or deny the remaining allegations in this paragraph and
`
`therefore denies them.
`
`25.
`
`Demaray admits that Demaray is a Delaware LLC. Demaray admits that Dr.
`
`Demaray is the founder of Demaray and that Dr. Demaray is one of the named inventors on the '276
`
`and '657 Patents. Demaray admits that the excerpted text in this paragraph appears on the
`
`hyperlinked website. Demaray admits that Dr. Demaray has over 50 years of experience working
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`12
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`with or in the semiconductor industry.
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`13
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`14
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`SUBJECT MATTER JURISDICTION
`
`26.
`
`Demaray admits that Applied purports to bring this action for a declaration under the
`
`Declaratory Judgment Act, 28 U.S.C. § 2201. Demaray denies any remaining allegations in this
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`16
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`paragraph.
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`17
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`27.
`
`Demaray admits that it filed lawsuits against Intel and Samsung alleging
`
`infringement of the '276 Patent and '657 Patent on July 14, 2020. This paragraph contains legal
`
`conclusions to which no response is required. Demaray denies any remaining allegations in this
`
`20
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`paragraph.
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`21
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`22
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`28.
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`29.
`
`30.
`
`Admitted.
`
`Admitted.
`
`Demaray admits that its complaints in the Texas cases identified the Endura product
`
`line from Applied that can be configured for deposition of TaN layers (e.g., CuBS RFX PVD with
`
`the Encore II Ta(N) barrier chamber) and TiN layers (e.g., Cirrus ionized PVD chamber). Demaray
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`26
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`denies any remaining allegations in this paragraph.
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`11130651
`
`
`- 4 -
`
`DEMARAY LLC'S AMENDED ANSWER AND
`COUNTERCLAIMS
`(Case No. 5:20-cv-09341-EJD)
`
`

`

`Case 5:20-cv-09341-EJD Document 174 Filed 08/11/22 Page 6 of 34
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`31.
`
`Demaray admits that Intel and Samsung use Applied reactors, among others, to
`
`deposit film layers in semiconductor products. Demaray is without knowledge sufficient to admit
`
`or deny the remaining allegations in this paragraph and therefore denies them.
`
`32.
`
`Demaray is without knowledge sufficient to admit or deny the allegations in this
`
`paragraph and therefore denies them.
`
`33.
`
`34.
`
`Denied.
`
`Demaray admits that its complaints in the Texas cases mentioned Applied reactors.
`
`Demaray denies any remaining allegations in this paragraph.
`
`35.
`
`Demaray admits that its complaints in the Texas cases mentioned Applied reactors.
`
`Demaray denies any remaining allegations in this paragraph.
`
`36.
`
`Demaray admits that the excerpted text appears in its complaints in the Texas cases.
`
`Demaray denies any remaining allegations in this paragraph.
`
`37.
`
`Demaray admits that its complaints in the Texas cases mentioned Applied reactors.
`
`Demaray admits that the excerpted text appears in Exhibit Q of the complaint. Demaray denies any
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`remaining allegations in this paragraph.
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`38.
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`Demaray admits that its complaints in the Texas cases mentioned Applied reactors.
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`Demaray denies any remaining allegations in this paragraph.
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`39.
`
`40.
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`Denied.
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`Demaray admits that Applied filed a purported declaratory judgment complaint on
`
`August 13, 2020 and amended its complaint on September 1, 2020. Demaray denies any remaining
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`21
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`allegations in this paragraph.
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`41.
`
`42.
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`Admitted.
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`Demaray admits that the excerpted text appears in its opposition to Applied's motion
`
`for preliminary injunction. Demaray denies any remaining allegations in this paragraph.
`
`43.
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`Demaray admits that it served infringement contentions on October 9, 2020.
`
`Demaray denies any remaining allegations in this paragraph.
`
`44.
`
`Denied.
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`11130651
`
`
`- 5 -
`
`DEMARAY LLC'S AMENDED ANSWER AND
`COUNTERCLAIMS
`(Case No. 5:20-cv-09341-EJD)
`
`

`

`Case 5:20-cv-09341-EJD Document 174 Filed 08/11/22 Page 7 of 34
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`45.
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`Demaray admits that Applied submitted declarations in Applied I in purported
`
`support of its motion for preliminary injunction. Demaray denies any remaining allegations in this
`
`paragraph.
`
`46.
`
`Demaray admits that it required, and still requires, discovery from Applied or other
`
`sources such as Applied suppliers to ascertain whether it will file additional compulsory
`
`counterclaims of infringement and that correspondence and conferences occurred regarding the
`
`same. Demaray denies any remaining allegations in this paragraph.
`
`47.
`
`Demaray admits that the excerpted text appears in the Joint Case Management
`
`Conference Statement submitted in Applied I. Demaray denies any remaining allegations in this
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`10
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`paragraph.
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`48.
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`49.
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`Denied.
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`Demaray admits that it served Applied with subpoenas in the Texas actions. Demaray
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`13
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`denies any remaining allegations in this paragraph.
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`14
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`50.
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`51.
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`52.
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`Denied.
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`Denied.
`
`This paragraph contains legal conclusions to which no response is required. Demaray
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`denies any remaining allegations in this paragraph.
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`53.
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`This paragraph contains legal conclusions to which no response is required. Demaray
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`denies any remaining allegations in this paragraph.
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`54.
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`This paragraph contains legal conclusions to which no response is required. Demaray
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`denies any remaining allegations in this paragraph.
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`55.
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`This paragraph contains legal conclusions to which no response is required. Demaray
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`denies any remaining allegations in this paragraph.
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`56.
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`This paragraph contains legal conclusions to which no response is required. Demaray
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`denies any remaining allegations in this paragraph.
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`57.
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`Demaray admits that the excerpted text appears in Exhibits A and B. This paragraph
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`contains legal conclusions to which no response is required. Demaray denies any remaining
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`allegations in this paragraph.
`
`11130651
`
`
`- 6 -
`
`DEMARAY LLC'S AMENDED ANSWER AND
`COUNTERCLAIMS
`(Case No. 5:20-cv-09341-EJD)
`
`

`

`Case 5:20-cv-09341-EJD Document 174 Filed 08/11/22 Page 8 of 34
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`58.
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`This paragraph contains legal conclusions to which no response is required. Demaray
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`denies any remaining allegations in this paragraph.
`
`PERSONAL JURISDICTION AND VENUE
`
`59.
`
`For purposes of this case only, Demaray admits that this Court has personal
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`jurisdiction over Demaray. Demaray admits that the excerpted information appears on the
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`hyperlinked webpages. Demaray denies any remaining allegations in this paragraph.
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`60.
`
`For purposes of this case only, Demaray admits that this Court has personal
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`jurisdiction over Demaray. Demaray admits that Intel purports to be headquartered in Northern
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`California and that Samsung has an office in Northern California. Demaray admits that Applied
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`10
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`asserts that it is headquartered in Northern California. Demaray denies any remaining allegations in
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`11
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`this paragraph.
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`61.
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`For purposes of this case only, Demaray admits that venue is proper in this district.
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`Demaray denies any remaining allegations in this paragraph.
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`62.
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`Demaray admits that Dr. Demaray has filed for over a hundred patents and has spent
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`much of his career in California. Demaray denies any remaining allegations in this paragraph.
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`63.
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`Demaray admits that Gary Edwards resides in Northern California. Demaray admits
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`that the Sales and Relationship Agreement between Applied Komatsu and Symmorphix was
`
`executed in Northern California. Demaray is without knowledge sufficient to admit or deny the
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`remaining allegations in this paragraph and therefore denies them.
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`FACTUAL BACKGROUND
`
`64.
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`65.
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`66.
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`Denied.
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`Admitted.
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`Demaray admits that Dr. Demaray, along with several other former employees of
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`Applied Komatsu formed Symmorphix and that Dr. Demaray held several roles at Symmorphix.
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`Demaray denies any remaining allegations in this paragraph.
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`67.
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`Demaray admits that Symmorphix employees continued to develop sputtered silicon
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`deposition technology at Symmorphix. Demaray denies any remaining allegations in this paragraph.
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`11130651
`
`
`- 7 -
`
`DEMARAY LLC'S AMENDED ANSWER AND
`COUNTERCLAIMS
`(Case No. 5:20-cv-09341-EJD)
`
`

`

`Case 5:20-cv-09341-EJD Document 174 Filed 08/11/22 Page 9 of 34
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`68.
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`Demaray affirmatively states that Exhibit I speaks for itself. Demaray denies any
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`remaining allegations in this paragraph.
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`69.
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`Demaray affirmatively states that Exhibit I speaks for itself. Demaray denies any
`
`remaining allegations in this paragraph.
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`70.
`
`Demaray affirmatively states that Exhibits I, J, and K speak for themselves. Demaray
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`denies any remaining allegations in this paragraph.
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`71.
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`Demaray affirmatively states that Exhibit J speaks for itself. Demaray denies any
`
`remaining allegations in this paragraph.
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`72.
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`Demaray admits that the excerpted text appears in Dr. Demaray's declaration
`
`submitted in Applied I. Demaray denies any remaining allegations in this paragraph.
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`73.
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`Demaray affirmatively states that Exhibit J speaks for itself. Demaray denies any
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`12
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`remaining allegations in this paragraph.
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`13
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`74.
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`Demaray affirmatively states that Exhibit N speaks for itself. Demaray denies any
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`14
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`remaining allegations in this paragraph.
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`15
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`75.
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`Demaray admits that the excerpted text appears in Exhibit N. Demaray denies any
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`16
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`remaining allegations in this paragraph.
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`76.
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`Demaray admits that the excerpted text appears in Exhibit N. Demaray denies any
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`remaining allegations in this paragraph.
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`77.
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`Demaray affirmatively states that Exhibit K speaks for itself. Demaray denies any
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`20
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`remaining allegations in this paragraph.
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`78.
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`Demaray affirmatively states that Exhibit K speaks for itself. Demaray denies any
`
`22
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`remaining allegations in this paragraph.
`
`79.
`
`80.
`
`81.
`
`82.
`
`83.
`
`Denied.
`
`Denied.
`
`Denied.
`
`Denied.
`
`Denied.
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`11130651
`
`
`- 8 -
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`DEMARAY LLC'S AMENDED ANSWER AND
`COUNTERCLAIMS
`(Case No. 5:20-cv-09341-EJD)
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`

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`Case 5:20-cv-09341-EJD Document 174 Filed 08/11/22 Page 10 of 34
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`84.
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`This paragraph contains legal conclusions to which no response is required. Demaray
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`denies any remaining allegations in this paragraph.
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`85.
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`This paragraph contains legal conclusions to which no response is required. Demaray
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`denies any remaining allegations in this paragraph.
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`86.
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`87.
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`88.
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`89.
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`90.
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`Denied.
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`Admitted.
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`Admitted.
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`Denied.
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`Demaray admits that Mukundan Narasimhan's employee agreement with Applied
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`contained the excerpted text. Demaray admits that the '276 and '657 Patents claim priority to the
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`'863 Application filed on March 16, 2002. Demaray denies any remaining allegations in this
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`FIRST COUNT
`(Declaration of Non-Infringement of U.S. Patent No. 7,544,276)
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`Demaray incorporates its answers to paragraphs 1-90.
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`Demaray admits that it owns all rights, title, and interest in the '276 Patent.
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`This paragraph contains legal conclusions to which no response is required. Demaray
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`91.
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`92.
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`93.
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`denies any remaining allegations in this paragraph.
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`94.
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`95.
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`Denied.
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`Demaray admits that Applied purports to seek declaratory judgment that Applied's
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`reactors, including those in the Endura product line, do not directly or indirectly infringe any claim
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`of the '276 Patent. Demaray admits that its complaints in the Texas cases mentioned Applied
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`reactors. Demaray denies any remaining allegations in this paragraph.
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`SECOND COUNT
`(Declaration of Non-Infringement of U.S. Patent No. 7,381,657)
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`Demaray incorporates its answers to paragraphs 1-95.
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`Demaray admits that it owns all rights, title, and interest in the '657 Patent.
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`This paragraph contains legal conclusions to which no response is required. Demaray
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`96.
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`97.
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`98.
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`denies any remaining allegations in this paragraph.
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`11130651
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`- 9 -
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`DEMARAY LLC'S AMENDED ANSWER AND
`COUNTERCLAIMS
`(Case No. 5:20-cv-09341-EJD)
`
`

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`Case 5:20-cv-09341-EJD Document 174 Filed 08/11/22 Page 11 of 34
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`99.
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`Denied.
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`100. Demaray admits that Applied purports to seek declaratory judgment that Applied's
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`reactors, including those in the Endura product line, do not directly or indirectly infringe any claim
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`of the '657 Patent. Demaray admits that its complaints in the Texas cases mentioned Applied
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`reactors. Demaray denies any remaining allegations in this paragraph.
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`THIRD COUNT
`(Declaration of Non-Infringement Based on License)
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`101. Demaray incorporates its answers to paragraphs 1-100.
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`102. This paragraph contains legal conclusions to which no response is required. Demaray
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`denies any remaining allegations in this paragraph.
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`103. Denied.
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`104. Denied.
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`105. Demaray admits that Ravi Mullapudi had an Applied Komatsu Employee
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`Agreement. Demaray denies any remaining allegations in this paragraph.
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`106. Denied.
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`107. Denied.
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`108. Demaray admits that Applied purports to seek a declaration that it holds a license to
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`the '276 and '657 Patents. Demaray denies any remaining allegations in this paragraph.
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`FOURTH COUNT
`(Declaration of Non-Infringement Based on Assignment of Rights to Applied and
`Demaray's Failure to Join All Co-Owners)
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`109. This claim has been dismissed pursuant to an order of the Court.
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`110. This claim has been dismissed pursuant to an order of the Court.
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`111. This claim has been dismissed pursuant to an order of the Court.
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`112. This claim has been dismissed pursuant to an order of the Court.
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`113. This claim has been dismissed pursuant to an order of the Court.
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`114. This claim has been dismissed pursuant to an order of the Court.
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`115. This claim has been dismissed pursuant to an order of the Court.
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`116. This claim has been dismissed pursuant to an order of the Court.
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`11130651
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`- 10 -
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`DEMARAY LLC'S AMENDED ANSWER AND
`COUNTERCLAIMS
`(Case No. 5:20-cv-09341-EJD)
`
`

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`Case 5:20-cv-09341-EJD Document 174 Filed 08/11/22 Page 12 of 34
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`117. This claim has been dismissed pursuant to an order of the Court.
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`118. This claim has been dismissed pursuant to an order of the Court.
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`DENIAL OF APPLIED'S PRAYER FOR RELIEF
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`Demaray denies that Applied is entitled to any relief, and specifically denies the allegations
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`and requests for relief set forth in paragraphs A-G under the heading "PRAYER FOR RELIEF" in
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`the Complaint.
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`FIRST AFFIRMATIVE DEFENSE
`(No Declaratory Judgment Jurisdiction)
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`The Complaint, and each purported cause of action asserted therein, improperly seeks to
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`invoke the jurisdiction of this Court under the Declaratory Judgment Act, 28 U.S.C. §§ 2201 and
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`2202, and the Court should decline to exercise such jurisdiction.
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`SECOND AFFIRMATIVE DEFENSE
`(Failure To State A Claim For Non-Infringement)
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`The Complaint, and each purported cause of action asserted therein, fails to state a claim
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`upon which relief can be granted because, among other things, Applied has not plausibly alleged
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`that it does not infringe either the '276 Patent or the '657 Patent.
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`THIRD AFFIRMATIVE DEFENSE
`(Failure To State A Claim For License)
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`The Complaint, and each purported cause of action asserted therein, fails to state a claim
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`upon which relief can be granted because, among other things, Applied has not plausibly alleged
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`that it holds a license to the '276 Patent or the '657 Patent.
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`FOURTH AFFIRMATIVE DEFENSE
`(Unenforceability Due to Estoppel, Waiver, and/or Unclean Hands)
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`The Complaint, and each purported cause of action asserted therein, is barred by the
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`doctrines of laches, estoppel, waiver, acquiescence, unclean hands, and/or other applicable
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`equitable defenses. For example, Applied has asserted various license and ownership claims to the
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`'276 Patent or the '657 Patent based upon assignment provisions in employee agreements that it
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`knew had been previously found by courts in this district to be void and unenforceable as an
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`unlawful restraint on trade in violation of California Business and Professions Code § 16000.
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`11130651
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`- 11 -
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`DEMARAY LLC'S AMENDED ANSWER AND
`COUNTERCLAIMS
`(Case No. 5:20-cv-09341-EJD)
`
`

`

`Case 5:20-cv-09341-EJD Document 174 Filed 08/11/22 Page 13 of 34
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`FIFTH AFFIRMATIVE DEFENSE
`(Not An Exceptional Case Warranting Attorneys' Fees From Demaray)
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`Applied cannot prove that this is an exceptional case justifying an award of attorneys' fees
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`against Demaray pursuant to 35. U.S.C. § 285.
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`DEMARAY LLC'S COUNTERCLAIMS FOR INFRINGEMENT
`OF U.S. PATENT NOS. 7,544,276 and 7,381,657
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`Demaray hereby asserts the following Counterclaims against Applied, as follows:
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`1.
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`This is a civil action seeking a judgment of infringement of U.S. Patent Nos.
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`7,544,276 (the "'276 Patent") (Ex. 1) and 7,381,657 (the "'657 Patent") (Ex. 2) (collectively, the
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`"Asserted Patents") under the patent laws of the United States, 35 U.S.C. § 1 et seq., including 35
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`U.S.C. § 271, giving rise to remedies specified under 35 U.S.C. § 281 and 283-85.
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`PARTIES
`Dr. Richard Ernest Demaray, a named inventor on both of the patents at issue in
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`2.
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`this case, has been working in and with the semiconductor industry for more than forty years. Dr.
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`Demaray began his training in chemical physics, studying ultraviolet photoconductivity of
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`materials. His doctoral work focused on cross-supersonic molecular and atomic beams with which
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`he demonstrated lossless conversion of molecular vibration to light in vacuum. During his post-
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`doctoral fellowship, he designed and built some of the first pulsed excimer laser driven tunable
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`dye lasers for resonant multiphoton photoionization in the cooled beam. That work became
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`instrumental to understanding the photo-physics of the high lying states of small and aromatic
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`molecules.
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`3.
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`Much of Dr. Demaray's work in industry has involved advances in thin film
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`technology. In the 1980s, he worked as a senior physicist at BOC Group on electron beam
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`evaporation technology used to deposit thermal barrier coatings. His work on adherent electron
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`beam evaporation thermal barrier coatings revolutionized high-temperature jet engine
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`performance, efficiency and longevity. Dr. Demaray's zirconia coatings are in worldwide
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`production today on military, commercial and power generation turbine hot section blades and
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`11130651
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`DEMARAY LLC'S AMENDED ANSWER AND
`COUNTERCLAIMS
`(Case No. 5:20-cv-09341-EJD)
`
`

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`Case 5:20-cv-09341-EJD Document 174 Filed 08/11/22 Page 14 of 34
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`vanes. Later that decade and continuing into the early 1990s, Dr. Demaray worked at Varian
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`Associates. He served as Varian's R&D Director for thin film systems, and developed full-face
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`erosion and sputter physical vapor deposition technology now used extensively in semiconductor
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`manufacturing worldwide. In the late 1990s, he helped form Applied Komatsu, where he served as
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`General Manager of the PVD division and developed wide-area magnetron sputter machines.
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`Thereafter, he managed several additional companies in the thin film space, including
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`Symmorphix Inc., where he served as Chief Technology Officer and Chairman of the Board.
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`4.
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`After serving in senior management roles at some of the more prominent
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`companies in the industry, he founded Demaray in order to focus on research, development, and
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`commercialization of new product applications based on technologies he had developed, including
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`technologies protected by the patents at issue in this case. Much of that work—which remains
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`ongoing—relates to the production of low-defect thin films for advanced electronic devices. In the
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`course of his work, Dr. Demaray discovered that his patented technology was being used by
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`entities such as Samsung and Intel—Applied's customers—without authorization, to manufacture
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`thin films in Samsung and Intel electronic devices.
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`5.
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`Demaray is a Delaware limited liability company duly organized and existing under
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`the laws of the State of Delaware. The address of the registered office of Demaray is 9 East
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`Loockerman Street, Suite 202, Dover, DE 19901. The name of Demaray's registered agent at that
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`address is Spiegel & Utrera, P.A.
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`6.
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`Demaray is the assignee and owns all right, title, and interest to the '276 Patent and
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`the '657 Patent. A true and correct copy of the '276 Patent is attached hereto as Exhibit 1. A true
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`and correct copy of the '657 Patent is attached hereto as Exhibit 2.
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`7.
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`On information and belief, Applied is a corporation organized and existing under
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`the laws of the state of Delaware, with its principal place of business at 3050 Bowers Avenue,
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`Santa Clara, CA 95054-3299.
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`11130651
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`- 13 -
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`DEMARAY LLC'S AMENDED ANSWER AND
`COUNTERCLAIMS
`(Case No. 5:20-cv-09341-EJD)
`
`

`

`Case 5:20-cv-09341-EJD Document 174 Filed 08/11/22 Page 15 of 34
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`JURISDICTION AND VENUE
`This is an action arising under the patent laws of the United States, 35 U.S.C. § 1 et
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`8.
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`seq. Accordingly, this Court has subject matter jurisdiction pursuant to 28 U.S.C. §§ 1331 and
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`1338(a).
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`9.
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`Applied is subject to this Court's specific and general personal jurisdiction
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`consistent with the principles of due process.
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`10.
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`Personal jurisdiction exists generally over Applied because it has sufficient
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`minimum contacts with the forum as a result of business conducted within the State of California
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`and the Northern District of California and/or has engaged in continuous and systematic activities
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`in the Northern District of California, and Applied is believed to have its principal place of
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`business at 3050 Bowers Avenue, Santa Clara, California, 95054-3299. Personal jurisdiction also
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`exists over Applied because Applied, directly or through subsidiaries, makes, uses, sells, offers for
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`sale, imports, advertises, makes available, and/or markets products or processes within the State of
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`California and the Northern District of California that infringe one or more claims of the Asserted
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`Patents, as alleged more particularly below. The Court further has personal jurisdiction over
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`Applied because Applied has submitted to the personal jurisdiction of this Court through the filing
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`of the Complaint.
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`11.
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`Venue in this District is proper under 28 U.S.C. §§ 1400(b) and 1391(b) and (c)
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`because Applied is subject to personal jurisdiction in this District and has committed acts of
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`infringement in this District. Applied, directly or through subsidiaries, makes, sells, offers to sell,
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`and/or provides process recipes for use in infringing products or processes within this District, has
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`a continuing presence within the District, and has the requisite minimum contacts with the District
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`such that this