`LIFESCAN SCOTLAND LIMITED
`
`
`Plaintiffs,
`
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`v.
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`UNISTRIP TECHNOLOGIES, LLC
`
`
`UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF NORTH CAROLINA
`CHARLOTTE DIVISION
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`NOW COMES Defendant UniStrip Technologies, LLC (“Defendant”), and answers the
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`
`
`
`
` Case No.: 3:14-CV-00274-MUL
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`ANSWER, AFFIRMATIVE DEFENSES
`AND COUNTERCLAIMS
`
`Defendant.
`_____________________________________
`
`Plaintiff’s Complaint:
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`1.
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`Defendant admits that Plaintiffs filed the lawsuit, that they seek injunctive relief
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`and damages, and that they allege infringement of US Patent Nos. 6,241,862 (the ‘862 Patent)
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`and 7,250,105 (the ‘105 Patent).
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`2.
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`3.
`
`4.
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`Defendant admits the allegations of paragraph 2.
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`Defendant admits the allegations of paragraph 3.
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`Defendant admits that it is organized under the laws of the State of North
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`Carolina, and that it has a principal place of business at 301 McCullough Drive, Suite 400,
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`Charlotte, North Carolina. Except as expressly admitted, Defendant denies the allegations of
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`paragraph 4.
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`5.
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`6.
`
`7.
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`Defendant admits the allegations of paragraph 5.
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`Defendant admits the allegations of paragraph 6.
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`Defendant admits the allegations of paragraph 7.
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`1
`Case 3:14-cv-00274-RJC-DSC Document 9 Filed 07/29/14 Page 1 of 14
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`8.
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`Defendant admits that such monitoring is done to detect hypoglycemia and
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`hypoglycemia, and that such conditions could lead to serious complications if untreated.
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`Defendant admits that some people test their blood glucose several times each day, and that such
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`testing is one of the most important things that people with diabetes can do to ensure their health
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`and to prevent long-term complications. Except as expressly admitted, Defendant denies the
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`allegations of paragraph 8.
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`9.
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`Defendant denies the validity of the ‘862 Patent. Without admitting the validity
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`of the ‘862 Patent, Defendant admits that the U.S. Patent and Trademark Office issued the ‘862
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`Patent on June 5, 2001, and that it is titled “Disposable Test Strips with Integrated
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`Reagent/Blood Separation Layer.” Defendant admits that Exhibit B to the Complaint is a copy of
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`the ‘862 Patent. Except as expressly admitted, Defendant denies the allegations of paragraph 9.
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`10.
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`Defendant denies the validity of the ‘105 Patent. Without admitting the validity of
`
`the ‘105 Patent, Defendant admits that the U.S. Patent and Trademark Office issued the ‘105
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`Patent on July 31, 2007, and that it is titled “Measurement of Substances in Liquids.” Defendant
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`admits that Exhibit B to the Complaint is a copy of the ‘105 Patent. Except as expressly
`
`admitted, Defendant denies the allegations of paragraph 10.
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`11.
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`Defendant denies the allegations of paragraph 11 for lack of sufficient
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`information to form a belief as to their truth.
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`12.
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`Defendant denies the allegations of paragraph 12 for lack of sufficient
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`information to form a belief as to their truth.
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`13.
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`Defendant admits that LifeScan is a leader in the worldwide market for blood
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`glucose monitoring systems. Defendant admits the remaining allegations of paragraph 13.
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`14.
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`Defendant denies the allegations of paragraph 14.
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`2
`Case 3:14-cv-00274-RJC-DSC Document 9 Filed 07/29/14 Page 2 of 14
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`15.
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`Defendant denies the allegations of paragraph 15 for lack of sufficient
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`information to form a belief as to their truth.
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`16.
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`17.
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`Defendant admits the allegations of paragraph 16.
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`Defendant admits that it promotes, and instructs users to use, UniStrip1™ Test
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`Strips with LifeScan’s OneTouch® Ultra®, Ultra®2, UltraSmart®, and UltraMini® meters. Except
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`as expressly admitted, Defendant denies the allegations of paragraph 17.
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`18.
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`19.
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`20.
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`Defendant admits the allegations of paragraph 18.
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`Defendant admits the allegations of paragraph 19.
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`Defendant admits that the packaging of the UniStrip1 Test Strips states that the
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`UniStrip1 Test Strips are “for use with OneTouch Ultra, Ultra2, UltraSmart, and UltraMini
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`meters.” Defendant denies that the image depicted in paragraph 20 is an accurate image of the
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`UniStrip1 Test Strips packaging. Except as expressly admitted, Defendant denies the allegations
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`of paragraph 20.
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`21.
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`Defendant admits that the Instructions for Use in the UniStrip1 packaging state
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`the words set forth in paragraph 21, among others. Except as expressly admitted, Defendant
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`denies the allegations of paragraph 21.
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`22.
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`Defendant admits that it has been aware of the ‘105 Patent and the ‘862 Patent
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`since the formation of the Defendant. Except as expressly admitted, Defendant denies the
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`allegations of paragraph 22.
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`23.
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`Defendant repeats its responses to the allegations in paragraphs 1-22, and
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`incorporate them herein by reference.
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`24.
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`25.
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`Defendant denies the allegations of paragraph 24.
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`Defendant denies the allegations of paragraph 25.
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`3
`Case 3:14-cv-00274-RJC-DSC Document 9 Filed 07/29/14 Page 3 of 14
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`
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`26.
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`27.
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`Defendant denies the allegations of paragraph 26.
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`Defendant denies the allegations of paragraph 27. Defendant has reviewed the
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`‘862 Patent and does not infringe it in any manner. To that end, Defendant has voluntarily
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`provided samples to Plaintiffs to show the same.
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`28.
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`Defendant repeats its responses to the allegations in paragraphs 1-27, and
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`incorporate them herein by reference.
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`29.
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`30.
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`31.
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`Defendant denies the allegations of paragraph 29.
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`Defendant denies the allegations of paragraph 30.
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`Defendant denies the allegations of paragraph 31. Defendant is specifically
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`precluded from infringing the ‘105 Patent by explicit holdings by the Fed. Cir. in LifeScan
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`Scotland, Ltd. v. Shasta Technologies, LLC, 734 F.3d 1361 (Fed. Cir. 2013) and the Supreme
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`Court in Limelight Networks, Inc. v. Akamai Technologies, Inc., 134 S. Ct. 2111 (2014).
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`32.
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`33.
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`34.
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`Defendant denies the allegations of paragraph 32.
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`Defendant denies the allegations of paragraph 33.
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`Defendant denies the allegations of paragraph 34.
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`
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`AFFIRMATIVE DEFENSES
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`FIRST DEFENSE – INVALIDITY
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`Each and every claim of the ‘862 Patent and the ‘105 patent is invalid because it is
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`anticipated by the pertinent prior art under 35 U.S.C. §102, and/or would have been obvious to one of
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`ordinary skill in the art in light of the pertinent prior art at the time of the claimed invention under 35
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`U.S.C. §103.
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`4
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`
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`Each and every claim claims of the ‘862 Patent and the ‘105 Patent are invalid for lack of
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`enablement, insufficient written description, indefiniteness, and/or failure to disclose the best mode
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`of the invention as required by 35 U.S.C. §112.
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`Each and every claim claims of the ‘862 Patent and the ‘105 Patent are vague and indefinite
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`and incorporate limitations that are neither disclosed, described, explained, nor enabled by the
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`specifications of the ‘862 Patent and the and the ‘105 Patent.
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`SECOND DEFENSE - UNENFORCEABILITY
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`Each and every claim of the ‘862 Patent and the ‘105 Patent is unenforceable for public use
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`and/or offer for sale/sale more than one year prior to filing of the U.S. patents.
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`THIRD DEFENSE – NONINFRINGEMENT
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`Defendants did not and do not infringe, either directly, contributorily, or by inducement, any
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`valid and enforceable claim of the ‘862 Patent or the ‘105 Patent, either literally or under the doctrine
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`of equivalents, as is open and obvious and well known to Plaintiff.
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`Plaintiff’s claims related to each and every claim of the ‘105 Patent are precluded to the
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`extent the ‘105 Patent includes all method claims where no single entity performs all of the claimed
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`steps thereby precluding contributorily or induced infringement by Defendant pursuant to Limelight
`
`Networks, Inc. v. Akamai Technologies, Inc., 134 S. Ct. 2111 (2014).
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`FOURTH DEFENSE – PATENT EXHAUSTION
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`
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`Plaintiff’s claims related to each and every claim of the ‘105 Patent are precluded pursuant to
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`the doctrine of patent exhaustion. See LifeScan Scotland, Ltd. v. Shasta Technologies, LLC, 734 F.3d
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`1361 (Fed. Cir. 2013).
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`FIFTH DEFENSE – PATENT MISUSE
`
`
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`Plaintiff’s claims related to each and every claim of the ‘105 Patent are precluded by the
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`doctrine of patent misuse based on Plaintiff broadening the scope of the ‘105 Patent to restrain
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`
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`5
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`
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`competition unlawfully in an appropriately defined relevant market. The ‘105 Patent covers both
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`meters and strips whereas Defendant only provides strips.
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`SIXTH DEFENSE – FAILURE TO STATE A CLAIM FOR RELIEF
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`Plaintiff has failed to state a claim upon which relief may be granted.
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`SEVENTH DEFENSE – FAILURE TO JOIN NECESSARY PARTIES
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`Plaintiffs’ claims are barred because they failed to join all necessary parties to this Action.
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`EIGTH DEFENSE – IMPLIED LICENSE
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`Plaintiff’s claims are barred by Plaintiff’s license, consent, and acquiescence to Defendant’s
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`use.
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`NINTH DEFENSE – RESERVATION AND NON-WAIVER
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`Defendant reserves all affirmative defenses under Rule 8(c) of the Federal Rules of Civil
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`Procedure, the Patent Laws of the United States and any other defenses, at law or in equity that may
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`now exist or in the future be available based on discovery and further factual investigation in this
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`case.
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`
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`COUNTERCLAIMS
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`NATURE OF THE CASE
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`1.
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`This is an action in Counterclaims for Declaratory Judgment and other relief
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`brought under the Federal Declaratory Judgment Act, 28 U.S.C. §§ 2201-02. Counterclaimant
`
`seeks a declaratory judgment that Counterclaimant’s products do not infringe any patent rights
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`purportedly owned by Plaintiffs / Counterclaim Defendants. In particular, Counterclaimant
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`seeks a declaratory
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`judgment (a)
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`that Counterclaimant’s products and
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`the use of
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`Counterclaimant’s products do not infringe U.S. Patent No. 6,241,862 (“the ‘862 patent”), and
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`(b) that Counterclaimant’s products and the use of Counterclaimant’s products do not infringe
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`U.S. Patent No. 7,250,105 (“the ‘105 patent”).
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`PARTIES
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`2.
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`UniStrip is a limited liability company organized and existing under the laws of
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`North Carolina and has its principal place of business at 301 McCullough Dr, Fourth Floor,
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`Charlotte, North Carolina 28262.
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`3.
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`LifeScan is a corporation organized and existing under the laws of California with
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`its headquarters and principal place of business in Wayne, Pennsylvania.
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`4.
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`LifeScan Scotland is a private limited company organized and existing under the
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`laws of the United Kingdom, with its headquarters and principal place of business in Inverness
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`Scotland.
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`5.
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`6.
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`JURISDICTION AND VENUE
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`This is a declaratory judgment action brought under 28 U.S.C. §§ 2201-02.
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`This Court has jurisdiction over the subject matter of this action pursuant to the
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`following statutes:
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`7
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`
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`(a)
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`28 U.S.C. § 1331, this being a civil action arising under the laws of the
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`United States;
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`(b)
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`28 U.S.C. § 1337 (a), this being a civil action arising under an Act of
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`Congress regulating commerce and protecting trade and commerce; and
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`(c)
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`28 U.S.C. § 1338(a), this being a civil action arising under an Act of
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`Congress relating to alleged patent rights.
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`7.
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`This Court may declare the rights and other legal relations of the parties in this
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`case under 28 U.S.C. § 2201 and Rule 57 Fed.R.Civ.P. because an actual and justiciable
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`controversy exists concerning the rights of, and legal relations between, Counterclaimant and
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`Plaintiffs / Counterclaim Defendants.
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`8.
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`This Court has personal jurisdiction over Plaintiffs / Counterclaim Defendants
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`consistent with the principles underlying the U.S. Constitution and N.C. Gen. Stat. § 1-75.4.
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`9.
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`On information and belief, Plaintiffs / Counterclaim Defendants have regularly
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`and intentionally conducted business in this State and District, have initiated the above-captioned
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`litigation thereby voluntary subjecting themselves to the personal jurisdiction of this Court, and
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`to this venue, and are subject to personal jurisdiction in this State and District by virtue of their
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`contacts here.
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`10.
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`On information and belief, Plaintiffs / Counterclaim Defendants have conducted
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`business in this State and District by, inter alia, systematically offering for sale products and/or
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`services, selling products and/or services, providing a website, sending solicitations, and
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`otherwise engaging in business activities within this State and District.
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`Case 3:14-cv-00274-RJC-DSC Document 9 Filed 07/29/14 Page 8 of 14
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`11.
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`On information and belief, Plaintiffs / Counterclaim Defendants have placed their
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`products into the stream of commerce while knowing that the products will likely arrive in this
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`State and District.
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`12.
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`On information and belief, Plaintiffs / Counterclaim Defendants’ products are
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`offered for sale to customers residing in this State and District and have been sold to customers
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`in this State and District.
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`13.
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`Venue is proper in this Court under the provisions of 28 U.S.C. § 1391.
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`Counterclaimant is located in this District, a substantial part of the events giving rise to
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`Counterclaimant’s claims occurred in this State and District, Plaintiffs / Counterclaim
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`Defendants are subject to personal jurisdiction in this State, and Plaintiffs / Counterclaim
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`Defendants initiated the above-captioned litigation, thereby electing and voluntary subjecting
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`themselves to this venue.
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`FACTS RELATED TO ALL COUNTS
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`14.
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`Defendant / Counterclaimant realleges and incorporates by reference paragraphs 1
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`through 1-13, inclusive, as if fully set forth in this paragraph.
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`15.
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`Counterclaimant imports, offers for sale and sells products for use in connection
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`with measuring and monitoring blood glucose levels, including test strips (“allegedly infringing
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`product”) for use with blood glucose meters.
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`16.
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`Plaintiffs / Counterclaim Defendants, through correspondence from their counsel,
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`and through the Complaint in the above-captioned matter, have alleged that Counterclaimant has
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`violated federal patent laws and have attempted to enforce their alleged patent rights against
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`Counterclaimant.
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`17.
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`In response to the correspondence, Counterclaimant reviewed the assertions and
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`found them to be baseless, without merit, and in bad faith. Counterclaimant provided this
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`9
`Case 3:14-cv-00274-RJC-DSC Document 9 Filed 07/29/14 Page 9 of 14
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`
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`information to the Plaintiffs / Counterclaim Defendants, offered to explain why Plaintiffs /
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`Counterclaim Defendants allegations are baseless, without merit, and in bad faith, and
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`voluntarily provided samples of the allegedly infringing product to the Plaintiffs / Counterclaim
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`Defendants.
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`18.
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`Plaintiffs / Counterclaim Defendants have failed to test or perform an adequate
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`pre-filing factual investigation on the allegedly infringing product.
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`19.
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`Plaintiffs / Counterclaim Defendants have failed to contact the Counterclaimant to
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`discuss why Plaintiffs / Counterclaim Defendants allegations are baseless, without merit, and in
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`bad faith.
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`20.
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`Contrary to Plaintiffs / Counterclaim Defendants’ allegations, Counterclaimant
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`has not infringed any of Plaintiffs / Counterclaim Defendants’ purported rights and is not liable
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`to Plaintiffs / Counterclaim Defendants for patent infringement or any other federal, state, or
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`common law causes of action, in law or in equity.
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`21.
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`Counterclaimant is not liable to Plaintiffs / Counterclaim Defendants for any fees,
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`monetary damages, or any other relief Plaintiffs / Counterclaim Defendants now claim.
`
`COUNT I
`DECLARATORY JUDGMENT OF NON-INFRINGEMENT, INVALIDITY,
`UNENFORCEABILITY OF U.S. PATENT NO. 6,241,862
`
`Defendant / Counterclaimant realleges and incorporates by reference paragraphs 1
`
`22.
`
`through 1-21, inclusive, as if fully set forth in this paragraph.
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`23.
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`Plaintiffs / Counterclaim Defendants have threatened Counterclaimant’s business
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`in this State and District and elsewhere by accusing Counterclaimant of unlawful actions,
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`including infringement of the ‘862 patent.
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`24.
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`Counterclaimant has not infringed any claim of the ‘862 patent.
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`
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`10
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`25.
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`Counterclaimant is legally permitted to make, import, use, sell, and offer to sell
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`UniStrip1 Test Strips and otherwise conduct its respective business activities without permission,
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`involvement, or interference from Plaintiffs / Counterclaim Defendants.
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`26.
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`There is an actual and substantial controversy between Counterclaimant and
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`Plaintiffs / Counterclaim Defendants of sufficient immediacy and reality to warrant the rendering
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`of a declaratory judgment by this Court.
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`27.
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`Counterclaimant is entitled to a judgment declaring that it has not violated any
`
`purported rights of Plaintiffs / Counterclaim Defendants under federal, state, or common law and
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`is not liable to Plaintiffs / Counterclaim Defendant for any claims, including any claim for patent
`
`infringement concerning the ‘862 patent.
`
`COUNT II
`DECLARATORY JUDGMENT OF NON-INFRINGEMENT, INVALIDITY,
`UNENFORCEABILITY OF U.S. PATENT NO. 7,250,105
`
`Defendant / Counterclaimant realleges and incorporates by reference paragraphs 1
`
`28.
`
`through 1-27, inclusive, as if fully set forth in this paragraph.
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`29.
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`Plaintiffs / Counterclaim Defendants have threatened Counterclaimant’s business
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`in this State and District and elsewhere by accusing Counterclaimant of unlawful actions,
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`including infringement of the ‘105 patent.
`
`30.
`
`31.
`
`Counterclaimant has not infringed any claim of the ‘105 patent.
`
`Counterclaimant is legally permitted to make, import, use, sell, and offer to sell
`
`UniStrip1 Test Strips and otherwise conduct its respective business activities without permission,
`
`involvement, or interference from Plaintiffs / Counterclaim Defendants.
`
`32.
`
`There is an actual and substantial controversy between Counterclaimant and
`
`Plaintiffs / Counterclaim Defendants of sufficient immediacy and reality to warrant the rendering
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`of a declaratory judgment by this Court.
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`
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`11
`Case 3:14-cv-00274-RJC-DSC Document 9 Filed 07/29/14 Page 11 of 14
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`
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`33.
`
`Plaintiff is barred from asserting any claim of the ‘105 patent based on the
`
`doctrine of patent exhaustion as ruled by the Fed. Cir. in LifeScan Scotland, Ltd. v. Shasta
`
`Technologies, LLC, 734 F.3d 1361 (Fed. Cir. 2013).
`
`34.
`
`Defendant does not contributorily infringe or induce infringement of any claims
`
`of the ‘105 patent since no single entity performs all of the claimed steps of the ‘105 patent
`
`pursuant to Limelight Networks, Inc. v. Akamai Technologies, Inc., 134 S. Ct. 2111 (2014).
`
`35.
`
`Counterclaimant is entitled to a judgment declaring that it has not violated any
`
`purported rights of Plaintiffs / Counterclaim Defendants under federal, state, or common law and
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`is not liable to Plaintiffs / Counterclaim Defendant for any claims, including any claim for patent
`
`infringement concerning the ‘105 patent.
`
`
`
`
`
`WHEREFORE, Defendant / Counterclaimant prays for the entry of a judgment:
`
`A.
`
`Declaring that Defendant / Counterclaimant has not infringed or otherwise
`
`violated any purported rights of Plaintiffs / Counterclaim Defendants, including any provisions
`
`of 35 U.S.C. § 101 et seq. or any other asserted federal, state, or common law laws;
`
`
`
`B.
`
`Finding this case exceptional in favor of Defendant / Counterclaimant pursuant to
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`35 U.S.C. § 285 pursuant to Plaintiffs / Counterclaim Defendants for inter alia failure to test or
`
`perform an adequate pre-filing investigation on the allegedly infringing product, and awarding
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`Defendant / Counterclaimant its costs and reasonable attorney fees;
`
`
`
`C.
`
`Granting Defendant / Counterclaimant a speedy hearing pursuant to Rule 57, Fed.
`
`R. Civ. P.; and
`
`
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`D.
`
`Granting Defendant / Counterclaimant any such further legal and equitable relief
`
`as the Court may deem just and proper.
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`
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`Case 3:14-cv-00274-RJC-DSC Document 9 Filed 07/29/14 Page 12 of 14
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`
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`JURY TRIAL DEMAND
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`Defendant / Counterclaimant respectfully requests that all issues so triable be tried by and
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`before a jury.
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`
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`Dated: July 29, 2014
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`CLEMENTS BERNARD PLLC
`
`By: /s/ Christopher L. Bernard
`Christopher L. Bernard
`N.C. State Bar No. 27713
`Lawrence A. Baratta, Jr.
`N.C. State Bar No. 37589
`1901 Roxborough Road, Suite 250
`Charlotte, NC 28211 USA
`Tel:
`704-790-3600
`Fax: 704-366-9744
`cbernard@worldpatents.com
`lbaratta@worldpatents.com
`
`UNISTRIP TECHNOLOGIES, LLC
`
`By: /s/ Andrew S. O’Hara
`Andrew O'Hara
`N.C. State Bar No. 24057
`General Counsel
`UniStrip Technologies, LLC
`301 McCullough Rd, Suite 400
`Charlotte, NC 28269 USA
`Telephone: 704-526-5848
`andyo@unistrip-tech.com
`
`ATTORNEYS FOR DEFENDANT
`AND COUNTERCLAIMANT
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`13
`Case 3:14-cv-00274-RJC-DSC Document 9 Filed 07/29/14 Page 13 of 14
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`
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`CERTIFICATE OF SERVICE
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` hereby certify that on the date listed below, I electronically filed the foregoing with the Clerk of
`
` I
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`Court using the CM/ECF system, which will send notification of such filing to the following:
`
`DAVID N. ALLEN
`DOUGLAS GRIMES
`Hedrick Gardner Kincheloe & Garofalo, LLP
`PO Box 30397
`Charlotte, NC 28230
`PH: (704) 366-1101
`FAX: (704) 366-6181
`dallen@hedrickgardner.com
`dgrimes@hedrickgardner.com
`
`Dated: July 29, 2014
`
`
`
`
`
`CLEMENTS BERNARD PLLC
`
`By: /s/ Christopher L. Bernard
`Christopher L. Bernard
`N.C. State Bar No. 27713
`Lawrence A. Baratta, Jr.
`N.C. State Bar No. 37589
`1901 Roxborough Road, Suite 250
`Charlotte, NC 28211 USA
`Tel:
`704-790-3600
`Fax: 704-366-9744
`cbernard@worldpatents.com
`lbaratta@worldpatents.com
`
`
`
`
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