Case 3:18-cv-00347-CAB-MDD Document 171 Filed 03/29/19 PageID.17601 Page 1 of 3
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`UNITED STATES DISTRICT COURT
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`SOUTHERN DISTRICT OF CALIFORNIA
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`NUVASIVE, INC.,
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`v.
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`ALPHATEC HOLDINGS, INC.,
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`Plaintiff,
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` Case No.: 3:18-CV-347-CAB-MDD
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`ORDER DENYING MOTION
`MOTION TO DISMISS
`COUNTERCLAIM XIII
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`Defendant.
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`[Doc. No. 162]
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`This matter is before the Court on Plaintiff NuVasive, Inc.’s motion to dismiss claim
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`XIII from Defendant Alphatec Holdings, Inc.’s second amended counterclaim.
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`Counterclaim XIII asserts that U.S. Patent No. 9,974,531 (the “‘531 Patent”) is
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`unenforceable due to inequitable conduct during prosecution of the patent. The ‘531 Patent
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`is directed toward systems and methods for accessing a targeted disc space through a
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`lateral, trans-psoas path. The Court previously granted NuVasive’s motion to dismiss
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`counterclaim XIII from the first amended counterclaim, while denying NuVasive’s motion
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`with respect to three other counterclaims. [Doc. No. 152.] In that order, the Court set out
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`the relevant procedural background, which will not be repeated here.
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`The legal standards set forth in the Court’s prior order continue to apply.
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`“Inequitable conduct is an equitable defense to patent infringement that, if proved, bars
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`Case 3:18-cv-00347-CAB-MDD Document 171 Filed 03/29/19 PageID.17602 Page 2 of 3
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`enforcement of a patent.” Therasense, Inc. v. Becton, Dickinson & Co., 649 F.3d 1276,
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`1285 (Fed. Cir. 2011) (en banc). The elements of “inequitable conduct are: (1) an
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`individual associated with the filing and prosecution of a patent application made an
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`affirmative misrepresentation of a material fact, failed to disclose material information, or
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`submitted false material information; and (2) the individual did so with a specific intent to
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`deceive the [Patent and Trademark Office (“PTO”)].” Exergen Corp. v. Wal-Mart Stores,
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`Inc., 575 F.3d 1312, 1327 n.3 (Fed. Cir. 2009).
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`“Intent and materiality are separate requirements.” Therasense, 649 F.3d at 1290.
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`The intent element requires a showing that “the patentee acted with the specific intent to
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`deceive the PTO. A finding that the misrepresentation or omission amounts to gross
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`negligence or negligence under a ‘should have known’ standard does not satisfy this intent
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`requirement.” Id. (internal citation omitted). Specific intent to deceive means an “intent
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`to deceive must be ‘the single most reasonable inference able to be drawn from the
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`evidence.’” Id. (citation omitted). “[T]he materiality required to establish inequitable
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`conduct is but-for materiality.” Id. at 1291. In cases of alleged failure to submit prior art
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`to the PTO, “the court must determine whether the PTO would have allowed the claim if
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`it had been aware of the undisclosed reference.” Id.
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`An inequitable conduct counterclaim must be pled with particularity under Federal
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`Rule of Civil Procedure 9(b). Exergen, 575 F.3d at 1326. Rule 9(b) states: “In alleging
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`fraud or mistake, a party must state with particularity the circumstances constituting fraud
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`or mistake.” In cases of inequitable conduct, the “particularity” in Rule 9(b) requires
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`“identification of the specific who, what, when, where, and how of the material
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`misrepresentation or omission committed before the PTO.” Id. at 1327.
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`Moreover, although “knowledge” and “intent” may be averred generally, a
`pleading of inequitable conduct under Rule 9(b) must include sufficient
`allegations of underlying facts from which a court may reasonably infer that
`a specific individual (1) knew of the withheld material information or of the
`falsity of the material misrepresentation, and (2) withheld or misrepresented
`this information with a specific intent to deceive the PTO.
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`Case 3:18-cv-00347-CAB-MDD Document 171 Filed 03/29/19 PageID.17603 Page 3 of 3
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`Id. at 1328-29. “A reasonable inference is one that is plausible and that flows logically
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`from the facts alleged, including any objective indications of candor and good faith.” Id.
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`at 1329 n.5.
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`In Counterclaim XIII, Alphatec alleges that NuVasive patent prosecution counsel
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`withheld the prior art reference of Kanter and Friedman, Percutaneous Discectomy: An
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`Anatomical Study, Neurosurgery, Vol. 16, No. 2 (1985). NuVasive moves to dismiss
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`Counterclaim XIII on the grounds that Alphatec failed to plead how Kanter is relevant or
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`material to the ‘531 Patent. The Court is not persuaded. Counterclaim XIII sufficiently
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`explains specifically how Kanter is allegedly relevant and material. NuVasive’s motion,
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`meanwhile, primarily disputes Alphatec’s allegations and argues that Kanter is not actually
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`relevant and material. NuVasive’s fact-intensive arguments are similar to those that
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`NuVasive made in favor of dismissal of Counterclaims X, XI, and XII from the first
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`amended counterclaim, which the Court rejected. [Doc. No. 152.] These arguments are
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`equally unavailing here.
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`Accordingly, NuVasive’s motion to dismiss is DENIED. NuVasive shall answer
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`the second amended counterclaim on or before April 12, 2019.
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`It is SO ORDERED.
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`Dated: March 29, 2019
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