Case 1:16-cv-00830-RGA Document 19 Filed 02/21/17 Page 1 of 26 PageID #: 1095
`Case 1:16-cv-OO830-RGA Document 19 Filed 02/21/17 Page 1 of 26 PagelD #: 1095
`
`IN THE UNITED STATES DISTRICT COURT
`
`FOR THE DISTRICT OF DELAWARE
`
`
`$PCO,LLCandH)COleXSdbthTUS
`
`IQ.
`
`Plaintiffs,
`
`v.
`
`CA. No. 16-830-RGA
`
`STREETLINE, INC, KAPSCH
`
`TRAFFICCOM HOLDING CORP, and
`KAPSCH TRAFFICCOM U.S. CORP.
`
`Defendants.
`
`MEMORANDUM OF REASONS IN SUPPORT OF MOTION TO DISMISS
`
`SIPCO’S FIRST AMENDED COMPLAINT WITH PREJUDICE PURSUANT
`
`TO RULE 12(B)(6) OF DEFENDANTS STREETLINE, INC. AND
`KAPSCH TRAFFICCOM HOLDING CORP.
`
`Ross ARONSTAM & MORITZ LLP
`
`Benjamin J . Sehladweiler (#4601)
`100 S. West Street, Suite 400
`Wilmington, DE 19801
`(302) 576-1600
`
`bschladweiler@ram11p.com
`
`Counsel for Defendants Street'line, Inc. and
`Kapsch TraficCom Holding Corp.
`
`OfCounsel:
`
`Pierre R. Yanney
`Stephen E. Underwood
`STROOCK & STROOCK & LAVAN LLP
`
`180 Maiden Lane
`New York, NY 10038
`(212) 806—5400
`pyanney/cbstroockeom
`sunderwood@stroock.com
`
`Dated: February 21, 2017
`
`
`
`

`

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`
`TABLE OF CONTENTS
`
`I.
`
`NATURE AND STAGE OF THE PROCEEDINGS ........................................................... .. I
`
`11.
`
`SUMMARY OF THE ARGUMENT ................................................................................... .. 1
`
`III.
`
`STATEMENT OF FACTS ............................................................................................... .. 2
`
`IV.
`
`ARGUMENT .................................................................................................................... .. 4
`
`A.
`
`Legal Standards ................................................................................................................. .. 4
`
`1.
`
`2.
`
`Legal Standards 7 Pleading Induced Infringement ....................................................... .. 4
`
`Legal Standards 7 Dismissal with Prejudice ................................................................. .. 5
`
`B.
`
`The FAC Fails to State a Claim for Direct Infringement .................................................. .. 7
`
`1.
`
`2.
`
`The FAC Fails to Allege Sufficient Facts to Plausibly Show That All the
`Elements of Any Asserted Claim Are Satisfied by the Accused Products ................... .. 7
`
`For Additional Reasons, the FAC Fails to State a Claim of Direct Infringement
`Against Kapsch Holding ............................................................................................. .. II
`
`C.
`
`The FAC Fails to State a Claim for Induced Infringement ............................................. .. 14
`
`l.
`
`2.
`
`3.
`
`4.
`
`The FAC Fails to Adequater Allege Underlying Direct Infringement ..................... .. 14
`
`The FAC Fails to Adequater Identify the Alleged Direct Infringer(s) ...................... .. 14
`
`The FAC Fails to Allege the Required Mental State .................................................. .. 15
`
`The Induced Infringement Allegations Against Kapsch Holding Are Deficient
`for At Least One Additional Reason ........................................................................... .. 17
`
`D. The FAC Should Be Dismissed With Prejudice ............................................................. .. 18
`
`V. CONCLUSION ................................................................................................................... .. 19
`
`_i_
`
`

`

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`
`TABLE OF AUTHORITIES
`
`Page(s)
`
`Cases
`
`Addiction & Detoxification Inst. L.L.C. v. Carpenter,
`620 F. App'x 934 (Fed. Cir. 2015) ......................................................................................... ..17
`
`Akamai Technologies, Inc. v. Limelight Networks, Inc,
`692 F.3d 1301 (Fed. Cir. 2012) .......................................................................................... ..4, 14
`
`Applera Corp. v. MJ Research, Inc.,
`297 F. Supp. 2d 459 (D. Conn. 2004) .................................................................................... ..18
`
`Ashcroft v. Iqbal,
`556 US. 662 (2009) ......................................................................................................... ..5, 7, 8
`
`Atlas IP, LLC v. Exelon Corp,
`189 F. Supp. 3d 768 (N.D.111. 2016) ....................................................................................... ..7
`
`In re Bill ofLacling Transmission & Processing Sys. Patent Litig,
`681 F.3d 1323 (Fed. Cir. 2012) .................................................................................... ..5, 15, 16
`
`Boyd v. Tempay,
`No. CIV.A. 07-377—JJF, 2008 WL 5156307 (D. Del. Dec. 4, 2008) ....................... ..3, 6, 18, 19
`
`California Pub. Employees’Ret. Sys. v. Chubb Corp,
`394 F.3d 126 (3d Cir. 2004) ............................................................................................... ..6, 18
`
`e—L YNXX Corp. v. InnerWorkings, Inc,
`No. 1—10-CV-02535, 2011 WL 3608642 (MD. Pa. July 26, 2011) ...................................... ..15
`
`eDigital Corp. v. iBaby Labs, Inc.,
`No. 15-5790, 2016 WL 4427209 (ND. Ca1. Aug. 22, 2016) .................................................. ..8
`
`Foman v. Davis,
`
`371 US. 178 (1962) ................................................................................................................. ..6
`
`GlobaliTecl/i Appliances, Inc. v. SEB SA,
`131 S.Ct. 2060 (2011) .................................................................................................. ..5,10,16
`
`Global—Tech Led, LLC v. Every Watt Matters, LLC,
`N0_ 15—CV—61933, 2016 WL 6682015 (SD. Fla. May 19,2016) ..................................... ..9, 10
`
`Kearns v. Gen. Motors Corp,
`94 F.3d 1553 (Fed. Cir. 1996) .................................................................................................. ..9
`
`_fi_
`
`

`

`Case 1:16-cv-00830-RGA Document 19 Filed 02/21/17 Page 4 of 26 PageID #: 1098
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`
`Kohan Prod Ltd. v. Comerica Bank,
`N0. CV 1040034 PSG, 2010 WL 956402 (CD. Cal. Mar. 11,2010) ..................................... ..1
`
`Limelighi Networks, Inc. v. Akamai Techs., Inc,
`134 S. Ct.2111 (2014) ........................................................................................................... ..14
`
`IMCIHIOSh v. Crisi,
`
`N0. CIVA. 3213-103, 2015 WL 418982 (W.D. Pa. Feb. 2, 2015) .................................... ..6, 18
`
`MEMC Elec. Materials, Inc. 12. Mitsubishi Materials Silicon Corp,
`420 F.3d 1369 (Fed. Cir. 2005) .............................................................................................. ..13
`
`NTP, Inc. v. Research In Motion, Ltd,
`418 F.3d 1282 (Fed. Cir. 2005) .............................................................................................. ..12
`
`Philips v. ASUSTeK Computer Inc,
`No. 15-1125vGMS, 2016 WL 6246763 (D. De]. Oct. 25, 2016) ............................................. ..9
`
`Price v. Gen. Cable Indus, Inc, No.
`
`C1V.A. 05—424], 2006 WL 3393686 (WD. Pa. Sept. 29, 2006) ............................. ..4, 6, 18, 19
`
`Raindance Techs, Inc. v. 10X Genomics, Inc.,
`
`No. 15-152-RGA, 2016 WL 927143 (D. Del. Mar. 4, 2016) ............................................ ..8, 14
`
`Scripps Research Insiiluie v. Illumina, Inc,
`No. 16-661, 2016 WL 6834024 (S.D. Cal. Nov. 21, 2016) ..................................................... ..7
`
`Sicom Sys, Lid. v. Agilent Techs, Inc,
`427 F.3d 971 (Fed. Cir. 2005) ............................................................................................ ..7, 18
`
`Smith v. Garlock Equip. C0,,
`658 F. App'x 1017 (Fed. Cir. 2016) ................................................................................. ..12, 13
`
`SynQor, Inc. v. Artesyn Technologies, Inc,
`709 F.3d 1365 (Fed. Cir. 2013) .......................................................................................... ..5, 16
`
`Tai v, Minka Lighting, Inc,
`No. CV-16-02810-PHX-DLR, 2017 WL 568519 (D. Ariz. Feb. 13, 2017) ............................ ..8
`
`TeleSign Corp. v. Twilio, Inc.,
`No. 16-2106, 2016 WL 4703873 (CD. Cal. Aug. 3, 2016) .................................................... ..8
`
`Varian Med. Sys, Inc. v. Elekta AB,
`N0. CV 15—871—LPS, 2016 WL 3748772 (D. Del. July 12, 2016) ........................................ ..14
`
`Warner—Lambert Co. v. Apotex Corp,
`316 F.3d 1348 (Fed. Cir. 2003) ................................................................................................ ..4
`
`
`
`—iii-
`
`

`

`Case 1:16-cv-00830-RGA Document 19 Filed 02/21/17 Page 5 of 26 PageID #: 1099
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`
`Wright ’s We]! Control Saws, LLC v. Oceaneering Int’l, Inc,
`No. CV 15-1720, 2017 WL 568781 (ED. La. Feb. 13, 2017) ................................................ ..8
`
`Statutes
`
`35 U.S.C. §271(a) ........................................................................................................... ..12,13,14
`
`Other Authorities
`
`Fed. R. Civ. P. 12(b)(6) .............................................................................................................. ..1, 3
`
`Fed. R. Civ. P. 15(a)(2) .................................................................................................................. ..5
`
`Fed. R. Evid. 902(1) ....................................................................................................................... ..1
`
`-iv-
`
`
`
`

`

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`
`I.
`
`NATURE AND STAGE OF THE PROCEEDINGS
`
`This is a patent case. Plaintiffs SIPCO, LLC and IF Co, LLC (“Plaintiffs”) filed their
`
`complaint on September 19, 2016, alleging infringement of ten patents. Defendants Streetline,
`
`Inc. (“Streetline”) and Kapsch TrafficCom Holding Corp. (“Kapsch Holding”) (“Defendants”)
`
`filed a motion to dismiss the complaint under Rule 12(b)(6), on November 18, 2016. See D.l. 7.
`
`The Court granted that motion on January 20, 2017, and gave Plaintiffs 21 days to file an
`
`amended complaint. See D.l. 15. Plaintiffs filed a First Amended Complaint (“PAC”) on
`
`February 6, 2017, naming the two original Defendants, plus one new one — Kapsch TrafficCom
`
`US. Corp. (“Kapsch U.S.”). See D.l. 16. The new named party (Kapsch US.) has not been
`
`served with process 7 and will never be able to be served with process - because that entity no
`
`longer exists, having been merged into Kapsch Holding on March 31, 2015.1
`
`Defendants now move to dismiss the FAC in its entirety, with prejudice.
`
`11.
`
`SUMMARY OF THE ARGUMENT
`
`1.
`
`The FAC fails to state a claim for direct
`
`infringement against any of the
`
`Defendants because, like the original complaint, it “contains no attempt to connect anything in
`
`the patent claims to anything about any of the accused products.” See D1. 15 at 3. Under the
`
`1 The merger of Kapsch U.S. into Kapsch Holding is evidenced by a Certificate of Ownership
`and Merger (“Merger Certificate”) from the Delaware Department of State, which is attached as
`Exhibit A to this Motion. The Merger Certificate bears the seal and signature of the Delaware
`Secretary of State; thus, it is self-authenticating under Fed. R. Evid. 902(1). This Court may rely
`on the Merger Certificate via judicial notice, because “merger certificates .
`.
`. are capable of
`accurate and ready determination by resort to sources whose accuracy cannot reasonably be
`questioned.” Kohcm Prod. Ltd. v. Comerz'ca Bank, No. CV 10—0034 PSG, 2010 WL 956402, at
`*1 n.
`1 (CD. Cal. Mar. 11, 2010). The Merger Certificate shows that, as of March 31, 2015,
`Kapsch US. was fully merged into Kapsch Holding, such that Kapsch U.S.’s separate corporate
`existence was ended. See Exh. A at 4 (stating that Kapsch Holding was the gn___y “surviving entity
`of [the] merger.”) This is confirmed by a printout from the Delaware State Department website e
`attached as Exhibit C 7 which states that Kapsch US. was “merged,” and is a “non~survivor”
`corporation, as of March 31, 2015. See Exh. C at 1. Thus, all references to Kapsch US. should
`be stricken from the complaint, because that entity no longer exists. See Exh. A at 4.
`
`
`
`

`

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`heightened pleading standards of Twombly/Iqbal, a patent complaint must allege enough facts to
`
`“make[] it plausible to think a defendant has infringed at least one claim of” each patent in suit.
`
`1d. at 4. This, in turn, requires allegations that show how the features of the accused product
`
`match up to the elements of at least one claim. The FAC does not meet this standard, because it
`
`makes no attempt to show that the accused products satisfy fl element of w claim — let alone
`
`a_ll the elements of a claim (as is required). Thus, the FAC should be dismissed.
`
`2.
`
`The FAC fails to state a claim for direct infringement against Kapsch Holding, for
`
`the additional reasons that: (i) it does not plausibly allege that Kapsch Holding committed any
`
`acts of direct infringement; and (ii) it does not allege any facts to show that Kapsch Holding
`
`controlled the conduct of Streetline to such a degree as to justify piercing the corporate veil.
`
`3.
`
`The FAC fails to state a claim for induced infringement against any Defendant,
`
`because: (i) it fails to state a claim for direct infringement against anyone, which is a necessary
`
`predicate to indirect
`
`infringement;
`
`(ii)
`
`it does not sufficiently identify w_ho was allegedly
`
`“induced to infringe;” (iii) it does not allege any facts to show that the Defendants 12m that the
`
`allegedly—induced acts constituted direct patent infringement; and (iv) it does not allege any facts
`
`to show that the Defendants had the specific intent to induce such infringement.
`
`4.
`
`The FAC further fails to state a claim for induced infringement against Kapsch
`
`Holding, because it does not identify any legally—cognizable “inducing act” by that Defendant.
`
`5.
`
`The FAC should be dismissed with prejudice, because Plaintiffs had a full
`
`opportunity to cure the deficiencies in the original Complaint, but the PAC fails to do so.
`
`III.
`
`STATEMENT OF FACTS
`
`The Court granted Defendants’ first Motion to Dismiss (D.I. 7) because, among other
`
`reasons, “[t]he [original] complaint contain[ed] no attempt to connect anything in the patent
`
`claims to anything about any of the accused products.” D.I. 15 at 3. As the Court found,
`
`
`
`

`

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`
`Plaintiffs’ failure to allege any facts tying the features of the accused products to the actual
`
`elements of the asserted claims rendered the complaint inadequate under Twombly/Iqbal. 1d. at 4-
`
`5. Rather than dismissing the complaint with prejudice, however, the Court gave Plaintiffs an
`
`opportunity to cure it, by permitting them to file an amended complaint within 21 days. Id.
`
`SIPCO filed an amended complaint — the PAC — on February 6, 2017. Although the PAC
`
`does add several new factual allegations about the accused products,2 it still fails to cure the
`
`deficiencies in the original complaint. Specifically, the FAC does not even attempt to cure the
`
`key deficiency in the original complaint e i.e., the failure to “connect anything in the patent
`
`claims to anything about any of the accused products.” D1. 15 at 3. Just like the original
`
`complaint, the PAC does not identify which components of the accused products allegedly
`
`correspond to which elements of m asserted claim. Indeed, like the original complaint, the PAC
`
`does not cite any claim language whatsoever. Thus, for the same reasons as the original
`
`complaint (and for the additional reasons set forth below), the PAC fails to state a claim.
`
`Typically, when a complaint is dismissed under Rule 12(b)(6), it is dismissed without
`
`prejudice (i.e., with leave to file an amended complaint). There are several exceptions to that
`
`
`rule, however. One exception is that a complaint may be dismissed with prejudice if the plaintiff
`
`“was [previously] given an opportunity to correct his pleading deficiencies” via an amended
`
`complaint, but the amended complaint fails to cure those deficiencies. Boyd v. Tempay, No.
`
`CIV.A. O7—377—JJF, 2008 WL 5156307, at *1 (D. Del. Dec. 4, 2008) (dismissing with prejudice).
`
`Here, the Court specifically told Plaintiffs that their original complaint was deficient
`
`because, among other reasons, it failed to “connect anything in the patent claims to anything
`
`about any of the accused products.” D.I. 15 at 3. Yet, the Plaintiffs” FAC has utterly failed to
`
`
`2 The differences between the original complaint and the PAC are shown in Exhibit B to this
`Motion, which is a computer-generated redline document showing the changes between the two.
`
`
`
`

`

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`correct that — or any other v of the original complaint’s deficiencies. When “[p]laintiffs were .
`
`.
`
`.
`
`on notice of the deficiencies in their initial pleading that they were expected to cure,” but there
`
`was a “patent failure to do so in the Amended Complaint,” that “compels the Court to
`
`dismiss [the Amended Complaint] with prejudice.” Price v. Gen. Cable Indus, Inc, No. CIVA.
`
`05-4241, 2006 WL 3393686, at *8 (WD. Pa. Sept. 29, 2006). That is exactly the situation
`
`presented here. Thus, the PAC should be dismissed with prejudice
`
`IV.
`
`ARGUMENT
`
`A.
`
`Legal Standards
`
`
`The legal standards governing direct infringement pleadings in the post-Form 18 era were
`
`set forth in Defendants’ original brief, D1. 8 at 5—8, and need not be repeated here.
`
`The legal
`
`
`standards governing induced infringement pleadings, as well as
`
`those
`
`governing whether a complaint should be dismissed with or without prejudice, were not
`
`addressed in Defendants’ prior brief; thus, they are set forth below.
`
`1. Legal Standards ~ Pleading Induced Infringement
`
`The FAC adds new allegations of induced infringement against Streetline and Kapsch
`
`Holding. See, e. g. D.l. 16, W 30, 36-37. Unlike direct infringement, which is a strict liability
`
`offense, induced infringement requires proof of a culpable state of mind. Akamai Technologies,
`
`Inc. v. Limelight Networks, Inc, 692 F.3d 1301, 1308 (Fed. Cir. 2012). Specifically, to state a
`
`claim for induced infringement, a plaintiff must allege sufficient facts to plausibly show that:
`
`o
`
`The defendant performed “actions [to] induce” a third party to commit “infringing
`
`acts.” Warner-Lambert Co. v. Apotex Corp, 316 F.3d 1348, 1363 (Fed. Cir. 2003);
`
`o
`
`The induced acts directly infringe the patent. See Akamai, 692 F.3d at 1309;
`
`
`
`

`

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`o
`
`The defendant had “actual ‘knowledge of the .
`
`.
`
`. patent that is [alleged to be]
`
`infringed.m SynQor, Inc. v. Artesyn Technologies, Inc, 709 F.3d 1365, 1379 (Fed. Cir. 2013)
`
`(quoting Global—Tech Appliances, Inc. v. SEB SA, 131 S.Ct. 2060, 2068 (2011));
`
`0
`
`The defendant had “[actual] knowledge that
`
`the induced acts [if performed,
`
`would] constitute .
`
`.
`
`.
`
`infringement” of the patent, SynQor, 709 F.3d at 1379, or else was
`
`“willfully blind” as to such knowledge. Global-Tech, 131 S. Ct. at 2068-72; and
`
`0
`
`The defendant acted with the “specific intent to encourage” the induced person to
`
`perform the acts that constitute infringement. In re Bill of Lading Transmission & Processing
`
`Sys. Patent Ling, 681 F.3d 1323, 1339 (Fed. Cir. 2012).
`
`Under Twomey/Iqbal, a plaintiff may not simply make a conclusory assertion that the
`
`defendant had the requisite state of mind (i.e., knew of the patent, knew that the acts were
`
`infringing, and had the specific intent to induce infringement). Bill of Lading, 681 F.3d at 1337—
`
`1340. Rather, the plaintiff must plead enough “factual content [to] allow[] the court to draw the
`
`reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal,
`
`556 U.S. 662, 663 (2009) (emphasis added).
`
`2. Legal Standards — Dismissal with Prejudice
`
`Fed. R. Civ. P. 15(a)(2) states that “[t]he court should freely give leave” to amend the
`
`pleadings, “when justice so requires.” The Supreme Court has explained this Rule as follows:
`
`If the underlying facts or circumstances relied upon by a plaintiff
`may be a proper subject of relief, he ought to be afforded an
`opportunity to test his claim on the merits. 1n the absence of any
`apparent or declared reasonisuch as undue delay, bad faith or
`dilatory motive on the part of the movant, repeated failure to cure
`deficiencies by amendments previously allowed, undue prejudice
`to the opposing party by virtue of allowance of the amendment,
`futility of amendment, etcgthe leave sought should, as the rules
`require, be ‘freely given.’ Of course,
`the grant or denial of an
`opportunity to amend is within the discretion of the District Court,
`
`

`

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`Foman v. Davis, 371 U.S. 178, 182 (1962) (emphasis added). Thus, when a court dismisses a
`
`complaint,
`
`it should usually give the plaintiff an opportunity to amend, unless there is an
`
`“apparent or declared reason” not to. Several such reasons are listed in Foman, including “undue
`
`delay,” “bad faith,” “futility” and “repeated failure to cure.”
`
`Here,
`
`the most relevant Foman reason is “repeated failure to cure deficiencies by
`
`amendments previously allowed.” As the Third Circuit has held, if a district court previously
`
`granted a motion to dismiss, and in so doing gave the plaintiff “clear guidance .
`
`.
`
`. [on how] to
`
`rectify the deficiencies in the complaint,” but the plaintiff “disregard[ed] .
`
`.
`
`. that advice, and .
`
`.
`
`.
`
`fail[ed] to propose additional amendments that would remedy the pleading deficiencies,” then it
`
`is proper for the court
`
`to dismiss the amended complaint with prejudice. California Pub.
`
`Employees' Rat. Sys. v. Chub!) Corp, 394 F.3d 126, 164 (3d Cir. 2004).
`
`Although Foman uses the term “repeated failure to cure” ~ which might suggest that
`
`dismissal with prejudice is not proper until there have been at least two failures to cure e many
`
`courts in this Circuit have dismissed with prejudice after only 9mn_e failure to cure. In most of
`
`these cases, dismissal with prejudice was justified by the fact that - as in Chubb, discussed above
`
`- the court gave the plaintiff specific advice on how to cure the deficiencies in the original
`
`complaint, but that advice was ignored. See, e.g., Price, 2006 WL 3393686, at *8 (dismissing
`
`m amended complaint with prejudice because plaintiffs were “on notice of the deficiencies in
`
`their initial pleading that they were expected to cure[; thus,] [t]heir patent failure to do so in the
`
`Amended Complaint compels the Court to dismiss .
`
`.
`
`. with prejudice”); McIntosh v. Crist, No.
`
`CIV.A. 3:13-103, 2015 WL 418982, at *15 (W.D. Pa. Feb. 2, 2015) (dismissing @ amended
`
`complaint with prejudice because “Plaintiffs” amended complaint fails to cure many of the
`
`[previously-identified] deficiencies of the original complaint”); Boyd, 2008 WL 5156307, at *1
`
`
`
`

`

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`(dismissing fur_st amended complaint with prejudice because “Boyd was given an opportunity to
`
`correct his [previously—identified] pleading deficiencies, to no avail.”)
`
`The Federal Circuit has confirmed that dismissal with prejudice is proper in patent cases,
`
`just as it
`
`is in other types of cases, when the patentee fails to cure specifically—identified
`
`deficiencies in the original complaint. See Sicom Syn, Ltd. v. Agilent Techs, Inc, 427 F.3d 971,
`
`980 (Fed. Cir. 2005) (affirming dismissal ofmst amended complaint with prejudice because the
`
`plaintiff“alreacly had a chance to cure the [identified] defect and failed”)
`
`B.
`
`The FAC Fails to State a Claim for Direct Infringement
`
`1. The FAC Fails to Allege Sufficient Facts to Plausibly Show That All the
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`Elements of Any_Asserted Claim Are Satisfied buhe Accused Products
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`Under Twombly/Iqbal, a complaint must allege sufficient “factual content [to] allow[] the
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`court to draw the reasonable inference that the defendant is liable for the misconduct alleged.”
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`Iqbal, 556 U.S. at 663 (emphasis added). In the context of direct patent infringement, a defendant
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`is not liable unless he performs acts that satisfy each and every element of a patent claim. See
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`Atlas IP, LLC v. Exelon Corp, 189 F. Supp. 3d 768, 775 (ND. Ill. 2016) (“the failure to practice
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`even a single element is all that separates [lawful] innovation from infringement”) Thus, to
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`satisfy the Twombly/Iqbal standard, a complaint for direct infringement of a patent must “permit
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`a court to infer that the accused product infringes each element of at least one claim” of that
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`patent. Id; see also Scripps Research Institute v. Illumina, Inc, No. 16-661, 2016 WL 6834024,
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`at *5 (SD. Cal. Nov. 21, 2016) (“under Twombly and Iqbal, a plaintiff must plausibly allege that
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`a defendant directly infringes each limitation in at least one asserted claim”) (emphases added).
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`The vast majority of courts that have addressed this issue, since the abolition of Form 18,
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`have agreed with the Atlas IP and Scripps courts that a complaint for direct patent infringement
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`now requires sufficient factual allegations to support a reasonable inference that each and every
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`element of at least one claim is present in the accused device or method. See, e. g, Wright ’3 Well
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`Control Sen/5., LLC v. Oceaneering Int'l, Inc., No. CV 15—1720, 2017 WL 568781, at *4 (ED.
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`La. Feb. 13, 2017) (noting that the “majority View [is] that Twombly and Iqbal require an
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`element-by-element or
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`limitation-by-limitation standard,” and then joining that majority);
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`TeleSign Corp. v. Twilio, Inc., No. 16-2106, 2016 WL 4703873, at *4 (CD. Cal. Aug. 3, 2016)
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`(“plaintiff must still plausibly allege that a defendant's product or products practice all elements
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`of at least one patent claim”); eDz‘gz‘tal Corp. v.
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`iBaby Labs, Inc., No. 15-5790, 2016 WL
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`4427209, at *3-4 (ND. Cal. Aug. 22, 2016) (adopting the “each of the limitations” standard); Tat
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`v. Minka Lighting, Inc, No. CV—l6—02810—PHX—DLR, 2017 WL 568519, at *2 (D. Ariz. Feb. 13,
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`2017) (same).
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`indeed, as Defendants explained in their Reply Brief in support of their original motion to
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`dismiss (DI. 14 at 9),
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`this very Court appears to have adopted the “element-by—element”
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`standard. In Raindance Techs, Inc. v. 10X Genomics, Inc, No. 15-152—RGA, 2016 WL 927143
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`(D. Del. Mar. 4, 2016), this Court dismissed a complaint for direct patent infringement because,
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`although it did allege sufficient facts to show that some of the elements of the claim were present
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`in the accused method,
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`it did r_10_t allege facts to show that $9 such element 7 “adjusting
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`pressure” _ was present. Id. at * 2. Thus, in Raindance, this Court held the plaintiff to the burden
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`of showing that afl elements of at least one Claim were present in the accused method — which is
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`equivalent to the “element—by—element” standard adOpted by the courts listed above. Indeed,
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`other courts have cited to this Court’s decision in Raindance as evidence that the District of
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`Delaware has adopted the “element-by—element” approach. See,
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`e.g.,
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`e.Dz'gz'tal, 2016 WL
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`4427209, at * 4 (stating that, in Raindance, this Court “conduct[ed] a limitation—by—limitation
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`analysis”).
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`Accordingly, to state a claim for direct infringement, the PAC must contain sufficient
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`allegations to permit a reasonable inference that all elements of at least one claim of each
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`asserted patent are present in the accused devices. It must separately meet this threshold for each
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`patent, because each patent gives rise to a separate and independent cause of action, which is
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`judged independently of the other patents in the case. See Kearns v. Gen. Motors Corp, 94 F.3d
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`1553, 1555 (Fed. Cir. 1996) ( “[b]y statutory and common law, each patent establishes an
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`independent and distinct property right,” and thus “each patent asserted raises an independent
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`and distinct cause of action[, such that] infringement of one patent is not a ground of liability for
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`infringement of a different patent”); see also Philips v. ASUSTeK Computer Inc, No. 15-1125-
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`GMS, 2016 WL 6246763 (D. Del. Oct. 25, 2016) (finding complaint met Twombly/[qbal because
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`“ flor each patent-in-suit, the plaintiffs provide[d] at least one example of each type of claim
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`allegedly infringed,” and provided adequate information to plausibly allege infringement of
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`each) (emphases added).
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`To meet this threshold, the complaint itself must contain some comparison between the
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`elements of a claim, and the features of the accused product. See Global-Tech Led, LLC v. Every
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`Wat! Matters, LLC, No.
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`lS—CV—61933, 2016 WL 6682015, at *3 (SD. Fla. May 19, 2016)
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`(dismissing complaint because “Plaintiff does not sufficiently tie any_sppcif1c operation to a
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`patent claim .
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`.
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`. [and] simply does not plead the elements of any representative claim or specify
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`any claim requirements”) (emphasis added). This comparison must appear in the complaint itself
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`— not in a brief ~ because a “Plaintiff may not amend [the] complaint through new allegations
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`raised [in a brief)” Id. Although the comparison between the accused product and the asserted
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`claim need not
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`take the form of a “claim chart” — as is required in formal
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`infringement
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`contentions — it does need to provide enough content (in narrative form or otherwise) to “connect
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`.
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`.
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`. the patent claims to [the features] of the accused products.” D.I. 15 at 3.
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`Importantly,
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`this threshold cannot be met simply by “‘generally describ[ing]’
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`the
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`Accused Products,” and then — by reference to that “general description” — making “the ‘bare
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`assertion’ that Defendants infringe.” Global—Tech, 2016 WL 6682015, at *3. Such a complaint is
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`inadequate because it fails to co_nn_€fl
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`the features of the accused products 7 as set forth in the
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`“general description” — with the actual features of the patent claims. Id. (dismissing complaint).
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`Here, Plaintiffs” FAC does exactly what was inadequate in Global-Tech e i.e., it simply
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`provides a “general description” of the alleged features of Streetline’s products, and then makes
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`the “bare assertion” — referring back to that description — that Streetline is infringing.
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`The “general description” of Streetline’s products appears at Paragraphs 17—26 of the
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`PAC. This description purports to identify some of the features and components of the accused
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`products, which Plaintiffs term the “Streetline System.” 10!. Critically, however, it contains m
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`discussion of as; of the elements or requirements of a_nv asserted claim. It makes no attempt to
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`show which components or features of the Streetline System correspond to which elements of an
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`asserted claim. In short — this “general description” is wholly devoid of any allegations which
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`“ti_e any specific operation [of the Streetline System] to a patent claim.” Global—Tech, 2016 WL
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`6682015, at *3 (emphasis added). Thus, the “general description” which Plaintiffs have added at
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`Paragraphs 17-26 of the PAC fails to cure the key deficiency in the original complaint — i.e., the
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`failure to “connect .
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`.
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`. the patent claims to [the features] of the accused products.” D.I. 15 at 3.
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`The remainder of the PAC fares no better. In the actual Counts of the complaint,
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`Plaintiffs have not added m allegations to attempt to tie the Streetline System to the features of
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`w patent claim. Rather — just like in the original complaint ~ the Counts simpl