Case 1:18-cv-00160-RGA Document 47 Filed 11/26/18 Page 1 of 6 PageID #: 674
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELAWARE
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`KOM SOFTWARE INC.,
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`Plaintiff,
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`V.
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`NETAPP, INC., APACHE CORPORATION,
`and ON SEMICONDUCTOR, LLC,
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`Defendants.
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`Civil Action No. 1 :18-cv-00160-RGA
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`MEMORANDUM ORDER
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`Presently before me is Defendants' Motion to Dismiss. (D.I. 13). The Parties have fully
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`briefed the issues. (D.I. 14, 21, 22). For the reasons set out below, I will DENY Defendants'
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`motion.
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`-
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`I.
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`BACKGROUND
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`Plaintiff is a Canadian corporation in the business of providing "secure data archiving
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`and storage management software and solutions." (D.I. 11 at ,-i,r 4, 12). It is the owner of the
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`seven patents-in-suit. (Id. at ,r,r 16-22). The asserted patents belong to two patent families. (Id.
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`at ,r,r 23-24). Family 1 is directed at Virtual Memory Systems and file lifecycle management.
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`(D.I. 21 at 2 n.l). Members of Family 1 include U.S. Pat. Nos. 6,348,642 and 7,392,234.
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`Family 2 is directed at Write-Once-Read-Many ("WORM") storage. (Id.). Members of Family
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`2 include U.S. Pat. Nos. 6,654,864 ('"864 Patent"), 7,076,624 ("'624 Patent"), 7,536,524,
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`8,234,477, and 9,361,243.
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`On January 29, 2018, Plaintiff sued NetApp, Inc. and two ofNetApp's customers,
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`Apache Corporation and ON Semiconductor, LLC, alleging direct and indirect infringement of
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`the patents-in-suit and that NetApp has willfully infringed the '864 Patent and the '624 Patent.
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`(D .I. 11 at ~~ 44-81 ). On April 6, 2018, Defendants filed the present motion in response to
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`Plaintiff's First Amended Complaint.
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`II.
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`LEGAL STANDARD
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`When reviewing a motion to dismiss pursuant to Federal Rule of Civil Procedure
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`12(b)(6), the Court must accept the complaint's factual allegations as true. See Bell Atl. Corp. v.
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`Twombly, 550 U.S. 544, 555-56 (2007). Rule 8(a) requires "a short and plain statement of the
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`claim showing that the pleader is entitled to relief." Id at 555. The factual allegations do not
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`have to be detailed, but they must provide more than labels, conclusions, or a "formulaic
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`recitation" of the claim elements. Id ("Factual allegations must be enough to raise a right to
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`relief above the speculative level ... on the assumption that all the allegations in the complaint
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`are true (even if doubtful in fact)."). Moreover, there must be sufficient factual matter to state a
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`facially plausible claim to relief. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). The facial
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`plausibility standard is satisfied when the complaint's factual content "allows the court to draw
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`the reasonable inference that the defendant is liable for the misconduct alleged." Id ("Where a
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`complaint pleads facts that are merely consistent with a defendant's liability, it stops short of the
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`line between possibility and plausibility of entitlement to relief." (internal quotation marks
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`omitted)).
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`III.
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`DISCUSSION
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`1. Direct Infringement Claims
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`Plaintiff alleges each of the Defendants directly infringes each of the patents-in-suit. The
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`Court of Appeals for the Federal Circuit has addressed the issue of the sufficiency of a patent
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`infringement complaint on multiple occasions. It seems apparent to me that the Court's view
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`generally is that very little is required to plead a claim of patent infringement. For example, in
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`Case 1:18-cv-00160-RGA Document 47 Filed 11/26/18 Page 3 of 6 PageID #: 676
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`Disc Disease Solutions Inc. v. VGH Solutions, Inc., 888 F.3d 1256 (Fed. Cir. 2018), the Court
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`reversed a district court dismissal of a patent infringement complaint. In relevant part, the Court
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`of Appeals stated:
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`The district court determined that Disc Disease failed to "explain how Defendants'
`products infringe on any of Plaintiffs claims" because it "merely alleges that certain of
`Defendants' products 'meet each and every element of at least one claim' of Plaintiffs
`patents." We disagree. Disc Disease's allegations are sufficient under the plausibility
`standard of Iqbal/Twombly. This case involves a simple technology. The asserted
`patents, which were attached to the complaint, consist of only four independent claims.
`The complaint specifically identified the three accused products-by name and by
`attaching photos of the product packaging as exhibits-and alleged that the accused
`products meet "each and every element of at least one claim of the '113 [or '509] Patent,
`either literally or equivalently." These disclosures and allegations are enough to provide
`VGH Solutions fair notice of infringement of the asserted patents. The district court,
`therefore, erred in dismissing Disc Disease's complaint for failure to state a claim.
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`Disc Disease, 888 F.3d at 1260 (alteration in original) (citations omitted).
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`In this case, the First Amended Complaint alleges that specifically-named products
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`infringe claims of each of the seven patents, copies of which Plaintiff attached to the First
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`Amended Complaint. The allegations are substantially identical, mirroring this format:
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`On information and belief, [Defendants], without authorization or license from
`KOM, have been and are presently directly infringing at least [ a claim] of [the
`Patent], as infringement is defined by 35 U.S.C. § 271(a), including through
`making, using (including for testing purposes), selling and offering for sale
`methods and articles infringing one or more claims of [the Patent]. [Defendants]
`are thus liable for direct infringement of [the Patent] pursuant to 35 U.S.C. §
`271(a). Exemplary infringing instrumentalities include [NetApp software and
`hardware].
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`(D.I. 11 at ,r,r 46, 51, 56, 61, 66, 71, 76).
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`I do not think meaningful distinctions can be made between complaints based on the
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`number of independent claims, 1 the number of accused products, 2 or even the complexity of the
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`technology. 3 On the basis of Disc Disease, I think each allegation of direct infringement in the
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`First Amended Complaint states a claim.
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`2.
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`Induced Infringement Claims
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`Plaintiff alleges that Defendant NetApp induces infringement of each of the patents-in(cid:173)
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`suit. Pursuant to 35 U.S.C. § 27l(b), "[w]hoever actively induces infringement of a patent shall
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`be liable as an infringer." "To prove induced infringement, the patentee must show direct
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`infringement, and that the alleged infringer knowingly induced infringement and possesses
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`specific intent to encourage another's infringement." Toshiba Corp. v. Imation Corp., 681 F.3d
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`1358, 1363 (Fed. Cir. 2012) (internal quotation marks omitted). Pre-suit knowledge is not
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`required to plead induced infringement. See Walker Digital, LLC v. Facebook, Inc., 852 F.
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`Supp. 2d 559, 565 (D. Del. 2012).
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`Each of the induced infringement allegations is substantially identical, mirroring this
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`format:
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`On information and belief, at least since being served with the Original
`Complaint, Defendant NetApp, without authorization or license from KOM, has
`been and is presently indirectly infringing at least [a claim] of [the Patent],
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`1 My understanding is that the sufficiency of each claim in a complaint is based on the
`allegations of that particular claim. Thus, from a sufficiency of the complaint basis, a complaint
`asserting two patents with two independent claims in each patent presents the same amount of
`notice as twenty patents with two independent claims in each patent.
`2 If the products are identified, I do not see any logical difference between the amount of notice
`given if there is one product or one hundred products.
`3 I am not a person of ordinary skill in the art of any technology, simple or complex. It is true
`that some patents are easier for me to understand than others, but I think the more relevant
`audience is the accused infringer. Generally-speaking, to a tech company, a tech patent is going
`to be simple, or at least understandable, even if I do not understand a word of it. Thus, what
`would be incomprehensible to me is still going to give "fair notice" to the company that makes
`the product, and to most companies that import, sell, or use the product.
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`4
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`including actively inducing infringement of [the Patent] under 35 U.S.C. § 271(b).
`Such inducements include without limitation, with specific intent to encourage the
`infringement, knowingly inducing customers to use infringing articles and
`methods that NetApp knows or should know4 infringe one or more claims of [the
`Patent]. NetApp instructs its customers, including Apache and ON
`Semiconductor, to make and use the patented inventions of [the Patent] by
`operating NetApp's products in accordance with NetApp's specifications.
`NetApp specifically intends its customers, including Apache and ON
`Semiconductor to infringe by implementing [NetApp Software with certain
`features].
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`(D.I. 11 at ,r,r 47, 52, 57, 62, 67, 72, 77).
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`These claims, in combination with the rest of the First Amended Complaint, are adequate.
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`Plaintiff sufficiently alleges Defendant NetApp's knowledge via service of the original
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`Complaint. Moreover, Plaintiff identifies the direct infringers and the actions NetApp takes to
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`induce that infringement. Plaintiffs allegation ofNetApp's post-suit knowledge of the patent,
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`coupled with the allegations indicating what actions are allegedly infringing, is sufficient.
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`3. Willful Infringement Claims
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`Defendants argue that Plaintiff fails to state a claim for willful infringement of the '864
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`Patent and the '624 Patent. "[A]llegations of willfulness without a specific showing of
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`egregiousness are sufficient to withstand a motion to dismiss. Thus, where a complaint permits
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`an inference that the defendant was on notice of the potential infringement and still continued its
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`infringement, the plaintiff has pled a plausible claim of willful infringement." Kyowa Hakka
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`Bio, Co. v. Ajinomoto Co., 2018 WL 834583, at *13 (D. Del. Feb. 12, 2018) (citations omitted).
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`When considering a motion to dismiss a willfulness claim, the Court must accept the complaint's
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`factual allegations as true. See Twombly, 550 U.S. at 555-56 (2007).
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`4 Although I find that Plaintiff sufficiently pleads its induced infringement claims, I note that the
`standard for induced infringement is not "should know." Proving a claim of induced
`infringement requires proof of actual knowledge or willful blindness. See Glob.-Tech
`Appliances, Inc. v. SEB S.A., 563 U.S. 754, 766-71 (2011).
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`Plaintiff alleges that NetApp obtained knowledge of the patents-in-suit during the
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`prosecution of NetApp patents and has continued infringement despite that knowledge. (D.I. 11
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`at ,r,r 79-80). NetApp argues that this allegation is untrue and therefore insufficient. (D.I. 13 at
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`12-13). However, NetApp's factual argument is an inappropriate basis for granting a motion to
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`dismiss. Thus, as I assume Plaintiffs allegation ofNetApp's knowledge to be true, it has pled a
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`sufficient willfulness claim.
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`IV.
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`CONCLUSION
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`Plaintiffs First Amended Complaint adequately states Plaintiffs claims of direct
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`infringement, induced infringement, and willful infringement of the patents-in-suit. Thus,
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`Defendants' Motion to Dismiss (D.I. 13) is DENIED.
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`IT IS SO ORDERED this 2/P day of November 2018.
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